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HIGH COURT OF AUSTRALIA Matter No S287/2009 APPELLANT AND THE QUEEN Matter No S288/2009 RESPONDENT APPELLANT AND THE QUEEN RESPONDENT [2010] HCA 18 26 May 2010 S287/2009 & S288/2009 ORDER In each matter, the appeal is dismissed. On appeal from the Supreme Court of New South Wales Representation S J Odgers SC with W P Lowe for the appellant in each matter (instructed by Ford Criminal Lawyers) P W Neil SC for the respondent in each matter (instructed by Commonwealth Director of Public Prosecutions) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Criminal law – Conspiracy – Fault element – Recklessness – Where appellants charged with conspiracy to deal with money where risk existed money would be used as instrument of crime – Whether charges bad in law because of inherent inconsistency in proving conspiracy where fault element of offence the object of conspiracy is recklessness – R v LK [2010] HCA 17. Words and phrases – "conspiracy to commit an offence", "instrument of crime". Criminal Code (Cth), ss 5.4, 11.5, 400.3(2). Introduction On 15 March 2006 the appellants and their brother, Abdul Jaleel Mohamed Ansari, were arraigned upon a joint indictment in the District Court of New South Wales on two counts of conspiracy under s 11.5 of the Criminal Code (Cth) ("the Code") to commit an offence against Commonwealth law known broadly as money laundering. The three men pleaded not guilty. The appellants were found guilty on each count. The jury were unable to reach a verdict in relation to their brother. The appellants appealed against their convictions to the Court of Criminal Appeal of New South Wales. They did so on the ground that the offences of which they had been convicted were not known to the law. They contended that the charges against them were bad because they alleged a mental state involving an intention which contemplated future reckless behaviour. On 14 August 2007, the Court of Criminal Appeal dismissed their appeals1. They applied for special leave to appeal to this Court on 12 September 2007. Their applications lapsed, but were later reinstated. On 2 October 2009 special leave was granted. The appeals were heard immediately after R v LK2. These reasons should be read with those in LK so far as they relate to the elements of conspiracy under the Code. For the reasons that follow the appeals must be dismissed. The indictment The first count of the joint indictment alleged against the appellants and their brother that: "Between about 1 September 2003 and about 14 October 2003 at Sydney in the State of New South Wales and elsewhere [they] did conspire with each other and with [Z] and divers other persons to deal with money to the value of $1,000,000 or more where there was a risk that the money would become an instrument of crime and where the said Abdul Jaleel Mohamed Ansari, Abdul Azees Mohamed Ansari and Hajamaideen Ansari were reckless as to the fact that there was a risk that the money would become 1 R v Ansari (2007) 70 NSWLR 89. [2010] HCA 17. an an [sic] instrument of crime contrary to section 11.5(1) and subsection 400.3(2) of [the Code]."3 The second count was in identical terms save that it covered a later period. As is clear from the indictment, the Crown alleged that a risk existed that the money would become an instrument of crime. It provided particulars of the offences in the commission or facilitation of which the money was allegedly to be used. In respect of each count they were: an offence under s 31(1) of the Financial Transactions Reports Act 1988 (Cth) ("the FTR Act"); or an indictable offence under Commonwealth law which potentially could be committed by deliberately evading the reporting of taxable income from a cash source. Statutory framework The relevant provisions of the Code, including those provisions dealing with the general principles of criminal responsibility and the elements of offences and s 11.5, which creates the offence of conspiracy, are set out in LK4. The other offence-creating provisions of the Code and the FTR Act which are central to these appeals are referred to below. Section 400.3(2) of the Code, which appears in Div 400 under the general heading "Money laundering", relevantly provides as follows: "400.3 Dealing in proceeds of crime etc – money or property worth $1,000,000 or more (2) A person is guilty of an offence if: the person deals with money or other property; and either: the money or property is proceeds of crime; or 3 Z, an Israeli national, was alleged to have been a co-offender of the appellants and their brother. [2010] HCA 17 at [41]-[47]. there is a risk that the money or property will become an instrument of crime; and the person is reckless as to the fact that the money or property is proceeds of crime or the fact that there is a risk that it will become an instrument of crime (as the case requires); and at the time of the dealing, the value of the money and other property is $1,000,000 or more. Penalty: Imprisonment for 12 years, or 720 penalty units, or both. (4) Absolute liability applies to paragraph[] … (2)(d)". The term "instrument of crime" is defined in s 400.1(1): "instrument of crime: money or other property is an instrument of crime if it is used in the commission of, or used to facilitate the commission of, an offence that may be dealt with as an indictable offence (even if it may, in some circumstances, be dealt with as a summary offence)." Critical to the disposition of the present appeals is s 5.4(4) of the Code, which provides that, where recklessness is a fault element for a physical element of an offence, proof of intention, knowledge or recklessness will satisfy that fault element. Section 31(1) of the FTR Act makes it an offence for a person to be a party to two or more "non-reportable cash transactions" where it would be reasonable to conclude that the person conducted the transactions in a particular manner or form for the sole or dominant purpose of ensuring, or attempting to ensure, that the currency involved in the transactions was transferred in a manner or form that would not give rise to a "significant cash transaction", within the meaning of the FTR Act. That purpose is assessed by reference to enumerated factors5. This kind of offence is commonly referred to as a "structuring offence". The factual background It is common ground that the Court of Criminal Appeal dealt with the case on the factual basis that follows. 5 FTR Act, s 31(1)(b). The appellants were directors of a company called Exchange Point Pty Ltd, through which they conducted a money exchange business in Sydney. In mid-2003, Z was recruited by a relative and other associates from Romania to travel to Australia and collect more than $2,000,000 in cash from the back of a floor safe located in an apartment at Bondi. He did so, and over a ten-day period delivered instalments of the money to the appellants at the Exchange Point premises. The appellants were said to have arranged for an associate to come to Exchange Point and take various portions of the money which they had received from Z and deposit them into a number of different bank accounts. The associate deposited a total of $1,952,107 on behalf of the appellants between 16 October 2003 and 13 May 2004. The sums were deposited in amounts of less than $10,000. The second count arose out of another visit to Sydney by Z in June The Crown case in relation to the first count was that when the appellants received cash exceeding $2,000,000 in October 2003: there were risks that at least some of the money which they had received might be used in structuring offences and that at least some of it would be dealt with in a way that facilitated deliberate tax evasion; the risk that the money would become an instrument of crime was one in respect of which the appellants were reckless "in the sense of being aware of and going ahead". In respect of the second count the Crown case was that the appellants agreed with Z in June 2004 to receive between $2,000,000 and $3,000,000 in cash and: they intended that they would receive from Z well over $1,000,000 in cash; a risk existed that the money would become an instrument of a structuring offence or an indictable offence under Commonwealth law which potentially could be committed by deliberately evading the reporting of taxable income from a cash source; the appellants were aware of the existence of the risks referred to in (b). The Crown case against the appellants did not ultimately rely upon them being reckless about the risk of the money becoming an instrument of crime. Their receipt and their contemplated receipt of the money, intending to "launder" it by deposits of less than $10,000, was said to have created the relevant risk. The charge was framed in terms of recklessness because the Crown was concerned that it would not be able to prove that Jaleel Ansari (about whom the jury ultimately were unable to reach any verdict) had any knowledge or intention that the money would be the subject of structured cash transactions. It was contended for the appellants that the Court of Criminal Appeal misunderstood the way in which the Crown case was put to the jury. At the hearing of the appeals to this Court, the appellants applied for special leave to appeal to raise that additional contention, which was refused. The disposition of these appeals turns not upon how the Crown put its case to the jury, but upon whether the charges against the appellants were bad in law. Special leave was also refused to add an additional ground of appeal. That ground was that the appellants could not be convicted of the offence charged because neither money the subject of a structuring offence nor money the subject of an offence of failing to report taxable income, could be regarded as an instrument of the commission of those offences. Leave was refused because the point, which may be of importance to the administration of the criminal law, had not been taken at trial or in the Court of Criminal Appeal. This Court did not therefore have the assistance of those Courts in relation to it. The reasoning of the Court of Criminal Appeal The single ground of appeal before the Court of Criminal Appeal in the case of each appellant was: "That a miscarriage of justice was occasioned in that the Appellant was tried and convicted of an offence not otherwise known to law." Howie J, with whose reasons Simpson and Hislop JJ agreed6, identified as the only issue to be resolved by the Court of Criminal Appeal whether there is a limit upon the applicability of the law of conspiracy for federal offences in addition to that specified in s 11.5(1)7. The argument advanced for the appellants in the Court of Criminal Appeal was that s 11.5(2)(b) of the Code indicated that Parliament intended to adopt the common law requirement that a person could not enter into a conspiracy recklessly. Howie J observed correctly that a conspiracy entered into recklessly was not known to the common law and is not (2007) 70 NSWLR 89 at 91 [1] per Simpson J, 124 [150] per Hislop J. Simpson J concurred with Howie J but delivered further reasons of her own. (2007) 70 NSWLR 89 at 103 [58]. an offence under s 11.58. But as he said, that conclusion did not resolve the real question in the appeals9. As formulated by Howie J, the question posed by the offences with which the appellants were charged was whether a person could conspire to commit an offence the mental element of which was recklessness10. After referring to authority, including Giorgianni v The Queen11, his Honour held that there seemed to be no good reason at common law why a person could not conspire to commit an offence of which the mental element was recklessness12. He considered that the position was the same under the Code13. It was the intention of what became the Model Criminal Code Officers Committee and the legislature which adopted its recommendations that the mental element of the offence of conspiracy under the Code was to reflect the position at common law14. That conclusion was correct for the reasons given in LK15. His Honour went on to reject the submission that the conspiracy alleged in each of the charges was bad at law. He gave two reasons for reaching that conclusion16: It may be that the agreement constituting the conspiracy contemplates a third party carrying out the relevant conduct. By the operation of s 5.4(4), recklessness under the Code can be proven by intention or knowledge. (2007) 70 NSWLR 89 at 106 [67]. (2007) 70 NSWLR 89 at 106 [67]. 10 (2007) 70 NSWLR 89 at 106 [68]. 11 (1985) 156 CLR 473; [1985] HCA 29. 12 (2007) 70 NSWLR 89 at 108 [76]. 13 (2007) 70 NSWLR 89 at 108 [77]. 14 Australia, Criminal Law Officers Committee of the Standing Committee of Attorneys-General, Model Criminal Code, Chapter 2: General Principles of Criminal Responsibility, Final Report, (1992) at 99. For a description of the background to the formation of the Model Criminal Code Officers Committee, see LK [2010] HCA 17 at [51], [53]. 15 [2010] HCA 17 at [51]-[57]. 16 (2007) 70 NSWLR 89 at 110 [87]-[88]. "It is the second reason that applies in the present case. Provided that the Crown was intending to prove as against the appellants that they knew that there was a risk that the money they dealt with would become an instrument of crime, that is that they knew of all the facts that made their dealing with the money criminal conduct, there was no impediment to the prosecution proving the offences charged." It was that proposition that applied to the appeals before the Court of Criminal Appeal and ultimately supported their dismissal. Simpson J agreed with the conclusions and reasons of Howie J but added her own reasons. Her Honour held that the conceptual difficulty of an intentional agreement to commit an offence of which recklessness is a fault element fades when regard is had to the extended definition of recklessness in s 5.4(4) of the Code18. Her Honour described what the Crown had to establish in the following terms19: "[T]he Crown had to prove that the appellants intentionally agreed that each would deal with money in the future, and that, at that future time each appellant would be aware that there then would be a substantial risk that there was a risk that the money would become an instrument of crime (that is, would be used in, or to facilitate, the commission of an indictable offence), and (by subpar (b)) that, having regard to the circumstances known to him, it was unjustifiable to take that risk. That is conceptually unacceptable. But it emerges only from the unextended meaning of 'recklessness'. To prove recklessness, by reason of s 5.4(4) the Crown could also prove either that the appellants intended or knew that the money would become an instrument of crime. That is, in fact, what the Crown here set out to do." The grounds of appeal The grounds of appeal to this Court, which were the subject of the grants of special leave to appeal on 2 October 2009, were: "That the Court of Criminal Appeal of New South Wales erred in holding that it was not bad in law for the Crown under [the Code] 17 (2007) 70 NSWLR 89 at 111 [89]. 18 (2007) 70 NSWLR 89 at 95 [21]. 19 (2007) 70 NSWLR 89 at 96 [23]. to charge a conspiracy to commit an offence the fault element of which is recklessness." "That the Court of Criminal Appeal of New South Wales erred in its characterization of the physical and fault elements of the offence of conspiracy under [the Code]." The disposition of the appeals Consideration of these appeals directs attention primarily to the first ground of appeal. The second ground was based upon a submission that the elements of the offence of conspiracy are defined by s 11.5(1) and (2) and not by the common law. On that submission, the element of conspiracy found in s 11.5(1) is that the offence which is the subject of the conspiracy must be punishable by imprisonment for more than 12 months or by a substantial fine. The other elements were said to be found in the other parts of s 11.5, particularly s 11.5(2) read subject to s 11.5(7A). Howie J was said to have erred by holding in effect that the term "conspires … to commit an offence" in s 11.5(1) imports the common law concept of conspiracy at least so far as the mental element is concerned. For the reasons which I gave in LK20, his Honour was correct in that conclusion, and the second ground of appeal cannot succeed. Even if it could have succeeded, the connection between the second ground and the fundamental question whether the charges were bad in law for alleging agreement to commit an offence of which recklessness is an element was not explained with any clarity in the written submissions or in the course of oral argument. The appellants submitted, in support of the first ground of appeal, that: It is conceptually unacceptable in a charge of conspiracy to allege an intention that a risk exist at some future time and that at that time someone will be reckless as to the existence of the risk. That is to say, a person cannot both intend that a circumstance will exist and intend to be reckless about the existence of that circumstance. In a case of conspiracy to commit an offence of which recklessness is an element, the conspirator would have to intend that the relevant physical circumstance exist, that he or she would be aware of the risk of its existence and that it be unjustifiable to take that risk. A concept of intention as to a lack of justifiability is incoherent. The conceptual difficulty is exacerbated when the "crime", of which the money the subject of the conspiracy might have been an instrument, is the 20 [2010] HCA 17 at [51]-[57]. structuring offence under the FTR Act or the deliberate evasion of the reporting of taxable income from a cash source. The appellants disputed the application of s 5.4(4), which allows the Crown to prove recklessness by proving intention or knowledge. They referred to the observation by Simpson J that the Crown could charge a conspiracy to commit a crime of recklessness because s 5.4(4) permits recklessness to be proven by establishing intention or knowledge21. Their response to that proposition was to refer to the use which the trial judge made of s 5.4(4). But whatever criticism might have been made of the trial judge's direction, misdirection was not a ground of appeal in the Court of Criminal Appeal or in this Court. The appellants went further and said that, in any event, s 5.4(4) could not be applied. It could be utilised only where recklessness was "a fault element for a physical element of an offence" and it was necessary to satisfy that fault element. The offence was conspiracy under s 11.5. That offence carries no fault element of recklessness. There is a fault element of intention in s 11.5(2)(b), not a fault element of recklessness. Accordingly, it was said, s 5.4(4) has no operation. To the extent that the preceding submission rests upon the premise that the elements of conspiracy are found in ss 11.5(1) and 11.5(2), it cannot succeed. It is not necessary, having regard to the grounds of appeal, to consider how the Crown presented its case and whether the Court of Criminal Appeal correctly characterised that presentation. The question is whether the charges set out in the indictment disclosed an offence known to the law. The objection was that they did not because there is a logical incoherence in applying the intention that an offence be committed, which is necessary to make out a conspiracy, to an offence of which recklessness is an element – in this case, an offence against s 400.3(2) of the Code. In so confining the question for determination, I do not dissent from the reasons given in the joint judgment in relation to the presentation of the case at trial by the Crown and the consideration by the Court of Criminal Appeal of the way in which it was presented. The offences charged on the indictment, on their face, involved the following allegations: The appellants entered into an agreement with each other and others to commit an offence punishable by imprisonment for more than 12 months or by a fine of 200 penalty units or more22. 21 (2007) 70 NSWLR 89 at 98 [33]. 22 Code, s 11.5(1) and (2)(a). The appellants entered into their agreement intentionally23. Each of the appellants intended that the offence would be committed pursuant to the agreement24. The offence which each appellant intended would be committed pursuant to the agreement was an offence against s 400.3(2) of the Code. The elements of an offence against s 400.3(2), as appears from that provision, comprise the following: a person deals with money25; there is a risk that the money will become an instrument of crime26; (iii) the person is reckless as to the fact that there is a risk that the money will become an instrument of crime27; at the time of dealing the value of the money is $1,000,000 or more28. The requisite intention on the part of the conspirators that the offence against s 400.3(2) be committed extends to an intention that the person committing it will be reckless as to the fact that there is a risk that the money 23 Code, ss 11.5(1) and 5.6(1), attaching the fault element of intention to the physical element of agreement, which perhaps illustrates the awkwardness at common law mentioned by McHugh J in Peters v The Queen (1998) 192 CLR 493 at 516 [55]; [1998] HCA 7 of treating agreement as actus reus and intention as mens rea. See LK [2010] HCA 17 at [57], [64]. 24 Code, s 11.5(2)(b). For either appellant to have been found guilty of the offence of conspiracy, it was necessary for that appellant and at least one other party to the agreement to have intended that an offence would be committed pursuant to the agreement. That other party could have been the other appellant or the appellants' brother or some other person. 25 Code, s 400.3(2)(a). 26 Code, s 400.3(2)(b)(ii). 27 Code, s 400.3(2)(c). 28 Code, s 400.3(2)(d). dealt with will become an instrument of crime. Such an intention may exist where the contemplated repository of the reckless state of mind is a third party29. But if it be the alleged conspirator who is said to intend to carry out the offence, that person may intend to deal with the money with knowledge of the risk that it will become an instrument of crime. Alternatively, such a person may intend to deal with the money intending that there will be a risk that it will become an instrument of crime. These states of mind are logically consistent and reflect the application of the extended meaning of recklessness under s 5.4(4) of the Code. Once that is accepted, no incoherence is introduced by reason of the particular offences of structured transactions and tax evasion relied upon to support the characterisation of the possible use of the money as an instrument of crime. That is not to say that a charge of this kind does not create a significant challenge for the trial judge in directing the jury in a way that is clear and comprehensible. But that practical difficulty does not go to the question whether the charges laid against the appellants were bad at law. For the preceding reasons the charges laid in the indictment against the appellants did disclose offences and the first ground of appeal therefore fails. The second ground of appeal fails for the reasons given in LK30. Conclusion The appeals should be dismissed. 29 As Howie J observed, "[p]rovided that the conspirators know of all the facts that would make the conduct of the third party criminal, it would not matter that the person carrying out the conduct was committing an offence by acting recklessly": (2007) 70 NSWLR 89 at 110 [87]. 30 [2010] HCA 17 at [51]-[57], [75]-[78]. Crennan Bell GUMMOW, HAYNE, HEYDON, CRENNAN, KIEFEL AND BELL JJ. Introduction The appellants were convicted, following a trial in the District Court of New South Wales, of two counts of conspiring to commit a money laundering offence. Part 10.2 of Ch 10 of the Criminal Code (Cth) ("the Code")31 creates a number of offences involving this activity. The offence particularised as being the object of these conspiracies involves dealing with money being reckless as to the risk that the money will be used as an instrument of crime. The appellants appealed against their conviction to the New South Wales Court of Criminal Appeal upon a single ground, which contended that they had been "tried and convicted of an offence not otherwise known to law"32. Under the Code it is an offence to conspire with another person to commit an offence punishable by more than 12 months imprisonment or a fine of 200 penalty units or more33 ("a non-trivial offence"). The appellants' case before the Court of Criminal Appeal was that it is not open under the Code to charge a conspiracy to commit an offence that has recklessness as its fault element. The Court of Criminal Appeal rejected this contention and dismissed the appeals. The appellants applied for special leave to appeal from the orders of the Court of Criminal Appeal. Their applications lapsed. They were reinstated following the grant of special leave to appeal in R v LK ("LK")34. That case raised an issue concerning proof of a conspiracy to commit the offence of dealing with money being reckless to the circumstance that the money is proceeds of crime35. It also raised an issue concerning the elements of the offence of conspiracy under s 11.5 of the Code. On 2 October 2009 the present appellants were granted special leave to appeal. The two grounds of appeal upon which special leave was given raise issues in common with those raised in LK. These 31 Criminal Code Act 1995 (Cth), s 3. 32 R v Ansari (2007) 70 NSWLR 89 at 91 [4] per Simpson J ("Ansari"). 33 Code, s 11.5(1). 34 [2010] HCA 17. 35 Code, s 400.3(2)(b)(i). Crennan Bell appeals were heard immediately following the hearing in LK. These reasons are to be read with the joint reasons in LK. One of the appellants' grounds contends that the Court of Criminal Appeal erred in its characterisation of the physical and fault elements of the offence of conspiracy under the Code. For the reasons given in the joint judgment in LK, the Court's analysis was correct and this ground must be dismissed. This conclusion has no bearing on the determination of the appellants' remaining ground, which is that the Court of Criminal Appeal erred in holding that a charge of conspiracy to commit an offence of recklessness under the Code is not "bad in law". The fault element of the offence of conspiracy is intention36. The foundation for the appellants' contention, that the charges are bad in law, is a suggested inconsistency inherent in proving that an accused conspirator intended that a circumstance will exist (a physical element of the offence that is the object of the conspiracy) and intended that, at that time, he or she would be reckless as to the existence of that circumstance. As will appear, the suggested inconsistency does not arise and it follows that each appeal must be dismissed. The indictment The appellants are brothers. They and a third brother, Abdul Jaleel Mohamed Ansari, were jointly charged in the first count of the indictment as follows: "Between about 1 September 2003 and about 14 October 2003 at Sydney in the State of New South Wales and elsewhere [they] did conspire with each other and with [Z] and divers other persons to deal with money to the value of $1,000,000 or more where there was a risk that the money would become an instrument of crime and where the said Abdul Jaleel Mohamed Ansari, Abdul Azees Mohamed Ansari and Hajamaideen Ansari were reckless as to the fact that there was a risk that the money would become to section 11.5(1) and an an [sic] subsection 400.3(2) of [the Code]." instrument of crime contrary 36 LK [2010] HCA 17 at [117]. Crennan Bell The second count in the indictment was in the same terms, save that the offence was particularised as occurring between about 22 March 2004 and about 29 July 2004. The jury were unable to agree upon their verdict with respect to Abdul The Court of Criminal Appeal The principal judgment in the Court of Criminal Appeal was delivered by Howie J (Hislop J concurring). Simpson J agreed with Howie J's reasons and gave additional reasons for dismissing the appeals against conviction. The Court held that the indictment did not charge offences that were "bad at law"37. Howie J characterised the issue raised by the appellants' ground of appeal as being whether there is a limitation on the application of the law of conspiracy to federal offences in addition to those limitations that are stated in s 11.5(1)38. His Honour concluded that there is nothing in the Code to suggest that a person cannot conspire to commit an offence of recklessness and thus no occasion for the Court to impose such a restriction39. His Honour gave two reasons to support that primary conclusion. First, the conspirators' agreement may provide for a third person to carry out the conduct that constitutes the offence. In such a case, provided that the accused conspirators know all of the facts that make the conduct criminal, it would not matter that the third person was acting recklessly40. Second, s 5.4(4) provides that recklessness, where specified as a fault element for an offence, may be satisfied by proof of intention or knowledge41. Provided that the accused conspirators intend that the conduct upon which they have agreed will be carried out and that they know all the facts that make that conduct criminal, it does not matter that the offence is one for which the fault element is recklessness42. 37 Ansari (2007) 70 NSWLR 89 at 110 [87]. 38 Ansari (2007) 70 NSWLR 89 at 103 [58]. 39 Ansari (2007) 70 NSWLR 89 at 110 [87]. 40 Ansari (2007) 70 NSWLR 89 at 110 [87]. 41 Ansari (2007) 70 NSWLR 89 at 110-111 [88]. 42 Ansari (2007) 70 NSWLR 89 at 110-111 [88]. Crennan Bell The conclusion that the Code does not preclude charging a conspiracy to commit an offence of recklessness, for any one of the reasons that the Court gave, was sufficient to dispose of the appeals on the sole ground of challenge. However, the Court went on to consider the appellants' challenge on a wider "Generally speaking the issue that is raised in respect of conspiracy to commit an offence to which recklessness applies is one of proof of the guilty knowledge of the conspirator rather than the validity of the charge. A charge is not bad at common law on its face just because it alleges a conspiracy to commit a strict or absolute liability offence or an offence that could be committed recklessly. It would be rare for the statement of the offence to show on its face that the allegation was one that relied upon the accused's being reckless as to a fact that was an element of the offence to which the conspiracy related. It should become apparent if particulars were required to be given indicating how it was alleged by the prosecution that the accused had agreed to commit the offence that is the subject of the conspiracy. Unless the prosecution was alleging that the accused had sufficient knowledge of the facts making the conduct agreed upon a criminal offence, it could not succeed on the charge of conspiracy." Consistently with these observations, his Honour turned to the conduct of the trial to determine whether it had been the prosecution case that the appellants had knowledge of the facts that made the conduct, upon which they had agreed, an offence. It is not necessary to set out the whole of the factual background, which his Honour detailed44. It is sufficient to take from the judgments the following summary of the evidence and the way the prosecution case was presented. The appellants were the directors of a money exchange business in Sydney known as Exchange Point Pty Ltd ("Exchange Point"). In 2003, Z, an Israeli national, flew to Australia and took possession of more than $2 million in cash. He delivered this money in batches to the appellants at Exchange Point. The appellants arranged for the money to be collected by an associate and 43 Ansari (2007) 70 NSWLR 89 at 110 [85]. 44 Ansari (2007) 70 NSWLR 89 at 100 [42]-[48]. Crennan Bell deposited by him on their behalf in various bank accounts. Each deposit was for an amount less than $10,000 in cash. Over a period of seven months the associate banked an amount of a little less than $2 million on the appellants' behalf. The appellants' agreement to deal with this money constituted the factual basis of the first count. The second count arose out of a further trip to Australia by Z in June 2004. It was the prosecution case that the appellants and Z agreed to deal with between $2 million and $3 million cash in the same fashion on this occasion but that the police arrested them before Z took possession of the money. Transactions Under the Financial Transaction Reports Act 1988 (Cth) ("the FTR Act") obligations are imposed on banks and other financial institutions to report cash transactions involving amounts of $10,000 or more (a "significant cash transaction")45 to the Director of the Australian Transaction Reports and Analysis Centre46. than $10,000 are involving amounts of "non-reportable cash transactions" under the FTR Act47. It is an offence under the FTR Act for a person to be a party to two or more non-reportable cash transactions if, having regard to the manner or form in which the transactions were conducted (including any explanation made by the person in this respect), it would be reasonable to conclude that the person conducted the transactions in that manner or form for the sole or dominant purpose of ensuring, or attempting to ensure, that the currency involved in the transactions was transferred in a manner or form that would not give rise to "a significant cash transaction" (or would give rise to "exempt cash transactions")48 (a "structuring offence"). less The prosecution case against the appellants was that, at the time they received the money (the first count), there existed a risk that the money would become an instrument of crime in that it might be used in a "structuring offence". During the course of the trial the prosecution particularised, as an alternative, the risk of tax evasion. It is neither necessary nor appropriate to consider in these reasons the difficulties that appear to lie in using the expression "tax evasion" as 45 FTR Act, s 3. 46 FTR Act, s 7. 47 FTR Act, s 3. 48 FTR Act, s 31(1). Crennan Bell a description of the offence which it is alleged money or other property was or would be "used in the commission of, or used to facilitate the commission of"49. The prosecution case on the second count was that the appellants intended to deal with money to be received from Z in the same way as they had dealt with the money received from Z on the earlier occasion. The same risks of criminal use were relied upon in respect of the second count. Howie J found that it was clear from the prosecutor's opening and closing addresses that its case was that the appellants were reckless as to the risk of the money being used as an instrument of crime because it was their intention that it would be used in this way50. The offence particularised as the object of each conspiracy is created by s 400.3(2) of the Code. Section 400.3(1) creates an offence of dealing with money intending that it will become an instrument of crime. This is a more serious offence than the offence under sub-s (2). Howie J observed that it may be that the agreement was to do acts constituting the more serious offence, but that this did not affect the appellants' liability for the offence with which they were charged51. His Honour commented that one reason for particularising the lesser offence as the object of the conspiracy was the perceived difficulty in proving that Abdul Jaleel Mohamed Ansari had the requisite knowledge of, or intention with respect to, the use to which the money would be put52. Howie J concluded that the prosecution case had been conducted upon the basis that the appellants had entered into an agreement intending to commit an unlawful act of the type prescribed53. His Honour had earlier noted s 5.4(4), observing that, provided the prosecution was intending to prove that the appellants knew all of the facts that made their dealing with the money criminal conduct, there was no impediment to proof of the charges in the indictment54. 49 Code, s 400.1 ("instrument of crime"). 50 Ansari (2007) 70 NSWLR 89 at 113 [92]-[93]. 51 Ansari (2007) 70 NSWLR 89 at 115 [101]. 52 Ansari (2007) 70 NSWLR 89 at 113 [92]. 53 Ansari (2007) 70 NSWLR 89 at 115 [99]-[101]. 54 Ansari (2007) 70 NSWLR 89 at 110-111 [88]-[89]. Crennan Bell Simpson J found that the appellants' argument failed to take into account the extended definition of recklessness contained in s 5.4(4). Her Honour considered that the case which the prosecution had set out to prove was one based on knowledge and intention55. Before turning to the appellants' challenge to these conclusions it is convenient to refer to the relevant statutory provisions. The statutory framework Section 400.3 relevantly provides: "(2) A person is guilty of an offence if: the person deals with money …; and either: there is a risk that the money … will become an instrument of crime; and the person is reckless as to the fact … that there is a risk that [the money] will become an instrument of crime …; and at the time of the dealing, the value of the money … is $1,000,000 or more. (4) Absolute liability applies to paragraphs … (2)(d) and …" It will be noted that the offence under s 400.3(2) has three physical elements: dealing with money (an element of conduct); the existence of a risk that the money will become an instrument of crime (an element of circumstance); and the value of the money is $1,000,000 or more (an element of circumstance). 55 Ansari (2007) 70 NSWLR 89 at 98 [33]. Crennan Bell The fault element for the physical element of circumstance set out in par (b)(ii), that there exists a risk that the money will become an instrument of crime, is recklessness. Section 5.4 of the Code defines recklessness, relevantly, as follows: "(1) A person is reckless with respect to a circumstance if: he or she is aware of a substantial risk that the circumstance exists or will exist; and having regard to the circumstances known to him or her, it is unjustifiable to take the risk. If recklessness is a fault element for a physical element of an offence, proof of intention, knowledge or recklessness will satisfy that fault element." Section 400.1(1) defines a number of terms for the purposes of Pt 10.2. "Instrument of crime" includes money if it is used in the commission of, or to facilitate the commission of, an offence that may be dealt with as an indictable offence (even if it may, in some circumstances, be dealt with as a summary offence). The appellants' submissions The appellants accept that the first of the two reasons given by the Court of Criminal Appeal for rejecting their primary contention, that the acts may be done by a third person, is correct. However, they say that this is not the case that was particularised against them in the indictment. They maintain that each charge as framed, that they were reckless as to the fact that there existed a risk that the money would become an instrument of crime, is "bad in law" because it is "conceptually unacceptable" to intend to be reckless as to a circumstance. In their written submissions the appellants challenge the Court of Criminal Appeal's second reason for rejecting their contention. They submit that the Court's recourse to s 5.4(4) to resolve the claimed conceptual difficulty involved error. This is because s 5.4(4) operates to allow the fault elements of intention and knowledge to satisfy the fault element of recklessness for an offence. Since Crennan Bell the fault element of the offence of conspiracy is intention there was no occasion, so the argument runs, to have recourse to s 5.4(4). The claimed conceptual difficulties The appellants identify suggested conceptual difficulties attending proof of each offence charged in the indictment. They submit that it was necessary for the prosecution to prove the following intentions in order to establish that they intended that the offence particularised in the indictment would be committed pursuant to their agreement: an intention that a person would deal with money; an intention that that person would intend to deal with the money; an intention that, at the time the person intentionally deals with the money, a risk exist that the money will be used in the commission of, or used to facilitate the commission of, an offence that may be dealt with as an indictable offence; and an intention that, at the time the person intentionally deals with the money, the person will be reckless as to the fact that there is a risk that the money will be used in the commission of, or used to facilitate the commission of, an offence that may be dealt with as an indictable offence". Proof of the intention in (d) is subject to a further layer of suggested conceptual difficulty arising from the definition of recklessness in the Code. The appellants submit that the prosecution was required to establish an intention that, at the time of the proposed dealing, the appellants would not only be aware of a substantial risk that the money would be used as an instrument of crime, but that they intended, at that time, to be of the opinion that such a risk would be objectively unjustifiable. The appellants characterise this requirement of proof as conceptually incoherent. The premise for the appellants' argument is that proof that a person intends to commit an offence requires proof that the person intends that each physical element of the offence will come into existence and that the fault element specified for that physical element will also come into existence at that time. It is a proposition which, if correct, would lead to directions of considerable complexity in summing-up to a jury with respect to a conspiracy to Crennan Bell commit an offence of recklessness. However, it would not follow from this that the charge is "bad in law". The proposition is, in any event, incorrect. Section 11.5(1) makes it an offence to conspire with another person to commit an offence. In the appellants' submission, the emphasised words are to be understood by reference to s 3.1(1), which provides that "[a]n offence consists of physical elements and fault elements". The legislative intent, it is said, is to require proof of each of the constituent elements of the subsidiary offence in order to establish guilt of the conspiracy. As explained in LK, the words "conspires" and "conspiracy" as used in s 11.5 are to be understood by reference to the common law subject to express modification under s 11.556. One such modification is that the offence is confined to agreements to commit an offence (being a non-trivial offence). Liability for conspiracy under the common law covers a wider field57. This is the legislative intent to be discerned in the use of the words "to commit an offence" in s 11.5(1). Proof of intention to commit an offence requires proof of the accused's knowledge of, or belief in, the facts that make the proposed conduct an offence58. Fault elements are specified with respect to physical elements of an offence59. They are defined in Div 5 of Pt 2.2 in a descending order of culpability: intention, knowledge, recklessness and negligence. The most blameworthy fault element is intention and the least blameworthy is negligence. To intend that a fact, circumstance or state of affairs will exist includes a lesser mental state with respect to the existence of that fact, circumstance or state of affairs60. A person may be criminally responsible for an offence even if he or she is mistaken about, or ignorant of, the existence or content of an Act that directly or indirectly creates the offence61. This rule of criminal responsibility provides a 56 LK [2010] HCA 17 at [96]-[107]. 57 LK [2010] HCA 17 at [134]; Mulcahy v The Queen (1868) LR 3 HL 306. 58 LK [2010] 17 at [117]. 59 Code, ss 3.1(2), 3.2. 60 This is reflected in the Code, s 5.4(4). 61 Code, s 9.3(1). Crennan Bell further reason for rejecting the contention that s 11.5 is to be interpreted as requiring proof that an accused conspirator intended that a specified fault element (being a fault element of lesser culpability than the fault element of intention) accompany a particular physical element of an offence as distinct from proof that the accused intended that an act or acts be performed which, if carried out in accordance with the agreement, would amount to the commission of an offence. The appellants' submission, that under s 11.5 a person does not intend that an offence will be committed unless he or she intends that any fault element specified for that offence will exist at the time the physical element for the fault element comes into existence, is unsustainable. Certain of the appellants' submissions proceed upon a view that, because the Code provides the offence of dealing with money intending that it will be used as an instrument of crime in s 400.3(1), it is not competent to particularise the lesser offence in s 400.3(2) as being the object of the conspiracy and prove it by establishing that the accused intended that the money would be used as an instrument of crime. It is an argument that, as the Court of Criminal Appeal correctly found, overlooks s 5.4(4). To deal with money, believing that there is or will be a risk that it will be used as an instrument of crime, is an offence contrary to s 400.3(2) as much as dealing with money, being reckless as to that risk, is an offence contrary to that provision. The Court of Criminal Appeal was right to reject the challenge that the indictment charged the appellants with offences that were not known to the law. In the written submissions filed on the appellants' behalf, it was foreshadowed that special leave would be sought to argue two further grounds of appeal. In oral submissions it was suggested that the Court of Criminal Appeal proceeded under a misapprehension as to the way in which the prosecution case had been put to the jury. It was not said that the judgments contained any error in the statement of the evidence or the way in which the prosecution case was presented. The complaint was as to the adequacy of the trial judge's directions to the jury concerning the elements of the offence. Senior counsel submitted that it was appropriate to grant special leave in order to correct a miscarriage of justice. The challenge to the sufficiency of the directions was sought to be advanced for the first time in this Court. It would appear that the suggested deficiency in the directions was not raised at the trial, where, if the point was good, it might have been addressed. The appellants would have required the leave of the Court of Crennan Bell Criminal Appeal in order to rely on the proposed ground in that Court62. Nothing in the appellants' submissions gave colour to senior counsel's assertion that their convictions are a miscarriage of justice. Special leave was refused. Special leave was also refused to rely on a ground concerning the meaning of "instrument of crime" as defined in s 400.1. Again, the issue had not been raised below and this Court did not have the benefit of consideration by the Court of Criminal Appeal on the question. Orders The appeals should be dismissed. 62 Criminal Appeal Rules (NSW), r 4.

HIGH COURT OF AUSTRALIA TRANSPORT ACCIDENT COMMISSION APPELLANT AND RESPONDENT Transport Accident Commission v Katanas [2017] HCA 32 17 August 2017 ORDER Appeal dismissed with costs. On appeal from the Supreme Court of Victoria Representation S A O'Meara QC with S D Martin for the appellant (instructed by Hall & Wilcox Lawyers) M F Wheelahan QC with M J Hooper for the respondent (instructed by Zaparas Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Transport Accident Commission v Katanas Accident compensation – Transport accident – Statutory compensation scheme – Where respondent involved in motor vehicle accident and subsequently suffered mental disorder or disturbance – Where mental disorder or disturbance required to be "severe" to allow bringing of common law proceedings – Where respondent did not require inpatient psychiatric treatment – Where respondent found not to have suffered symptoms of psychological trauma at upper echelon of range – Whether severity of mental disorder or disturbance assessed only by reference to extent of treatment – Whether narrative test laid down in Humphries v Poljak [1992] 2 VR 129 followed by Court of Appeal. Words and phrases – "mental disturbance or disorder", "narrative test", "range or spectrum of comparable cases", "serious injury", "severe", "symptoms and consequences". Transport Accident Act 1986 (Vic), s 93. KIEFEL CJ, KEANE, NETTLE, GORDON AND EDELMAN JJ. This appeal raises for consideration the application of the narrative test of serious injury for the purpose of s 93(17) of the Transport Accident Act 1986 (Vic) ("the narrative test") laid down in Humphries v Poljak1. There is only one ground of appeal: that the majority of the Court of Appeal of the Supreme Court of Victoria (Ashley and Osborn JJA, Kaye JA dissenting) erred in holding that the primary judge misdirected himself as to the application of the narrative test. Special leave to appeal was granted because the appeal was said to raise a question of principle of general importance. As put at the application for special leave, that question was whether the majority of the Court of Appeal erred by casting aside or "trampling upon" the narrative test – particularly that part of it which calls for a comparison of the case in suit with other cases in the range of comparable cases – and substituting a new and unprecedented test of bringing to account the subjective symptoms and consequences of an alleged serious injury and assessing their significance by reference to a new and unexplained concept of a "line"2. When the appeal came on for hearing, however, it became apparent that the appellant's oral argument was directed to two contentions: the contention that the majority had trampled upon the narrative test; and an alternative contention – which was nowhere as such identified in the appellant's written submissions – that the majority of the Court of Appeal had misunderstood the primary judge's formulation of the "possible range" and thereby fallen into error. For the reasons which follow, it is clear that the majority of the Court of Appeal did not depart from the narrative test. It is also clear that the appellant's alternative contention, alleging a misunderstanding of the primary judge's formulation of the range, is not a ground for which special leave was granted. It raises no question of general importance. It should not be entertained. Relevant statutory provisions At relevant times, and as far as is pertinent for present purposes, s 93 of the Transport Accident Act provided as follows: "(1) A person shall not recover any damages in any proceedings in respect of the injury or death of a person as a result of a transport accident occurring on or after the commencement of section 34 except in accordance with this section. [2016] HCATrans 286 at lines 11-14, 96-104, 147-170. Nettle Gordon Edelman (2) A person who is injured as a result of a transport accident may recover damages in respect of the injury if— the injury is a serious injury. under section 46A, 47(7) or 47(7A), the Commission has determined the degree of impairment of a person who is injured as a result of a transport accident; and the degree so determined is less than 30 per centum— the person may not bring proceedings for the recovery of damages in respect of the injury unless— the Commission— is satisfied that the injury is a serious injury; and issues to the person a certificate in writing consenting to the bringing of the proceedings; or a court, on the application of the person, gives leave to bring the proceedings. (17) In this section— serious injury means— serious long-term impairment or loss of a body function; or Nettle Gordon Edelman permanent serious disfigurement; or severe behavioural disturbance or disorder; or long-term mental or severe long-term loss of a foetus." The narrative test of serious injury The terms "serious" and "severe" are not defined in the Transport Accident Act but, for the last 25 years, it has been accepted that the question of whether an injury is "serious" for the purpose of s 93(17) is to be answered according to the narrative test laid down by the Full Court of the Supreme Court of Victoria in Humphries v Poljak3: "To be 'serious' the consequences of the injury must be serious to the particular applicant. Those consequences will relate to pecuniary disadvantage and/or pain and suffering. In forming a judgment as to whether, when regard is had to such consequence, an injury is to be held to be serious the question to be asked is: can the injury, when judged by comparison with other cases in the range of possible impairments or losses, be fairly described at least as 'very considerable' and certainly more than 'significant' or 'marked'?" (emphasis added) In Mobilio v Balliotis4 the Court of Appeal of the Supreme Court of Victoria affirmed the application of the narrative test in relation to mental and behavioural disturbance or disorder and held that "severe" in that context is of stronger force than "serious". As appears from Humphries v Poljak, the application of the narrative test entails a two-stage process: an assessment of whether the nature and symptoms of the injury and the consequences of the injury are, subjectively for the applicant, "serious" or, in the case of mental or behavioural disturbance or disorder, "severe"; and [1992] 2 VR 129 at 140 per Crockett and Southwell JJ. [1998] 3 VR 833 at 846 per Brooking JA (Winneke P, Ormiston JA, Phillips JA and Charles JA agreeing at 834-835, 854, 858, 860-861). Nettle Gordon Edelman a determination of whether the injury as thus assessed is objectively "serious" or, in the case of mental or behavioural disturbance or disorder, "severe" when compared with the range or "spectrum"5 of comparable cases. The facts The respondent was born in Greece in 1945 and migrated to Australia in 1962. She married in 1964 and was employed in various positions until the early to mid-1990s. From 1995, she looked after several of her grandchildren on a regular basis. In the period from 1998, she obtained the Victorian Certificate of Education, a Diploma of Modern Greek Language and a Bachelor of Arts degree, as well as completing a course which entitled her to operate a taxi licence. Her husband died in 2005. At about 7.00 pm on 10 July 2010, the respondent was driving her car on Princes Highway, Mulgrave, on her way home. After stopping at a red light at the intersection of Princes Highway and Springvale Road, and waiting until the light had changed to green, she proceeded into the intersection. At that point another vehicle collided with the driver's side of her car. It is not clear whether she lost consciousness but she suffered multiple fractures of her left rib, seatbelt bruising, severe chest pain, a laceration to her left knee and damage to some of the teeth in her lower jaw. She was conveyed by ambulance to the Alfred Hospital and remained there until discharged on 14 July 2010. Following her discharge from hospital, the respondent attended on her general practitioner, Dr Chan. Dr Chan prescribed pain medication and referred the respondent for physiotherapy. Thereafter, the respondent attended on Dr Chan on several further occasions, complaining of pain, lowered mood, nightmares and daytime thoughts of the accident. On 26 October 2010, the respondent reported to Dr Chan that she had returned to 70 per cent of her pre-accident physical function. In November 2010, Dr Chan referred the respondent to a psychologist, Dr Alvarenga, whom the respondent thereafter continued to see for treatment until about mid-2014 and then again from about 5 See, for example, Dwyer v Calco Timbers Pty Ltd (No 2) [2008] VSCA 260 at [7] per Ashley JA (Nettle JA and Dodds-Streeton JA agreeing at [1], [31]); Stijepic v One Force Group Aust Pty Ltd [2009] VSCA 181 at [42] per Ashley JA and Beach AJA; Sutton v Laminex Group Pty Ltd (2011) 31 VR 100 at 117 [89] per Tate JA (Ashley JA and Hargrave AJA agreeing at 102 [1], 121 [115]). Nettle Gordon Edelman the middle of 2015. In the course of that treatment, Dr Alvarenga referred the respondent to a clinical psychologist, Dr Raj, for eye movement desensitisation and reprocessing treatment to assist with the respondent's flashbacks and distressing memories of being trapped in the car. After that treatment, the respondent reported to Dr Alvarenga that she had experienced some relief from intrusive memories. Throughout 2011 and 2012, the respondent continued to attend on Dr Chan for treatment of neck, back, hand and knee pain suffered as a result of the accident. In 2011, Dr Chan offered anti-depressant medication to the respondent, but at that point the respondent declined. Dr Chan also offered to refer the respondent to a psychiatrist, which offer the respondent at that point also declined. In April 2013, however, the respondent felt the need for more psychological treatment to deal with recurrent flashbacks. At that point, Dr Chan prescribed anti-depressant medication and the respondent began to attend on a psychiatrist, Associate Professor Mazumdar, for further treatment. In February 2014, the respondent presented to the emergency department at Monash Medical Centre and consulted a psychiatric nurse in relation to nightmares suffered since taking anti-depressant medication. The nurse taught the respondent breathing techniques. Later in 2014, the respondent commenced treatment with a clinical psychologist, Dr D'Abbs, as part of a pain management programme. Dr D'Abbs subsequently reported that the respondent had found the psychological input helpful. The respondent continued to see Dr D'Abbs for psychological treatment at least until 2015. The proceedings at first instance On 16 April 2013, the respondent filed an originating motion in the County Court of Victoria seeking leave to commence common law proceedings for a serious injury pursuant to s 93(4) of the Transport Accident Act. The motion came on for hearing before Judge O'Neill in August 2015. The respondent's claim was that she had suffered a psychiatric injury which was "severe"6. In order to establish the severity of her disorder, she relied on her need for continuing treatment with Dr Chan, Dr Alvarenga, Associate Professor Mazumdar and Dr D'Abbs; her need for daily anti-depressant medications in a setting of intermittent nightmares and flashbacks of the accident; difficulties in relaxing and feeling safe; inability to drive a car for more than short distances; inability to look after her grandchildren in the manner which she had done prior to the accident; difficulties in concentration and organising her thoughts that 6 Katanas v Transport Accident Commission [2015] VCC 1156 at [29]-[44]. Nettle Gordon Edelman affected her ability to read and cook, and inhibited her from further studies; interruption of sleep; and restrictions in her social pursuits. Her claim was supported by the opinions of her treating medical practitioners and also by several other medical practitioners whom she consulted or had been required to consult for medico-legal purposes. Several of them identified symptoms of post-traumatic stress disorder and diagnosed that condition7. Others proffered different psychiatric diagnoses8. The respondent was cross-examined on the "severity" of her condition and its consequences by reference to the degree of her continued involvement in the lives of her children and grandchildren, her ongoing relations with friends, her independence in domestic matters and her involvement in investment properties and the operation of a taxi licence. On the basis of that cross-examination, the primary judge found9 the respondent to be an "unsatisfactory witness" who: "did not answer questions in the manner [he] would expect of an honest witness"; refused to answer questions directly put to her; denied histories that she was recorded as having given to treating and other medical practitioners; gave explanations that his Honour found to be evasive and unimpressive; and regularly sought to argue and prevaricate when matters were clearly put to her, which, his Honour said, "cause[d] [him] to have reservations about the extent to which her psychological symptoms have impacted upon her life". The primary judge, however, did not reject all of the respondent's testimony. His Honour accepted10 that the respondent had suffered a range of symptoms arising out of the accident, including flashbacks and nightmares, that had prevented her from undertaking any ongoing studies, affected her sleep and her ability to look after her grandchildren, and necessitated psychological treatment and medication which would need to be continued into the foreseeable future. The primary judge also accepted11 the opinions of the respondent's treating and other practitioners that the respondent had suffered a post traumatic stress disorder and either a major depressive disorder or an adjustment disorder 7 Katanas [2015] VCC 1156 at [49], [55], [60], [62], [65], [71]. 8 Katanas [2015] VCC 1156 at [72], [73]. 9 Katanas [2015] VCC 1156 at [77], [78]. 10 Katanas [2015] VCC 1156 at [83]-[84]. 11 Katanas [2015] VCC 1156 at [79], [81]. Nettle Gordon Edelman which was substantially related to the accident. On that basis, the primary judge identified12 the "real issue" as being whether, "given the reservations [his Honour had] in respect of [the respondent's] credibility", the psychological symptoms and consequences met "the test for 'severe' injury as prescribed by the Act". The primary judge observed13 that in order to satisfy the test of whether a mental disorder or disturbance is "severe": "the consequences arising from a transport accident must be more 'serious long-term substantial than the test posed [in relation to impairment or loss of a body function']; that is, that they must be more than 'very considerable' when a comparison is made with other cases in the possible range of impairments. Thus, consideration must be given to the vast array of mental disorders which may be encountered following a transport accident. At one end of the spectrum is mild anxiety as a result of trauma, easily overcome without medical intervention. At the other end of the spectrum are those disorders which provoke the most extreme symptoms and consequences, psychiatric hospitals as an inpatient, delusional beliefs and thoughts, suicidal ideation and suicide attempts. Such conditions require extensive treatment and medication. It follows that for a mental disorder to be described as being 'severe', it is at the upper echelon of those disorders in the possible range." (emphasis added) including psychoses, admission Having so stated the test, the primary judge next recorded14 that, although he accepted the respondent had suffered the range of symptoms claimed, he had "some reservations about [her] description of her symptoms and the effect upon her of the diagnosed psychological condition", and that he did not accept that her condition was "as extreme as she would have it". Of importance to that conclusion was that, notwithstanding the respondent's symptoms, the respondent had retained a capacity to: live independently and undertake most of her usual domestic tasks; drive a car, albeit only for short distances and with some fear; look after her grandchildren and remain involved in their lives, albeit not to the same extent as before the accident; carry on some degree of social life, albeit reduced compared to what had gone before; and manage a number of investment 12 Katanas [2015] VCC 1156 at [82]. 13 Katanas [2015] VCC 1156 at [82]. 14 Katanas [2015] VCC 1156 at [85]. Nettle Gordon Edelman properties and a taxi licence, albeit with the assistance of agents. And although the respondent had received considerable treatment and medication, she had not been an inpatient in any psychiatric institution (save for one visit to the emergency department) "nor suffered the more extreme symptoms of psychological trauma as described above". On that basis, the primary judge concluded15: "Balancing on the one hand, the extent to which I accept [the respondent] has suffered psychological consequences, and on the other, the extent to which she has been able to maintain her involvement in social, recreational and domestic matters, I am not satisfied that she meets the requisite statutory test. In essence, I am not satisfied the mental disorder from which she suffers may be described [as] 'severe'." The proceedings in the Court of Appeal The respondent appealed to the Court of Appeal. She contended, inter alia, that the primary judge had misdirected himself as to the objective assessment of the severity of her mental disorder. She submitted that the error was to set up a spectrum ranging from mild anxiety not requiring treatment to the most extreme symptoms and consequences requiring extensive treatment and medication, and so to conceive of the severity of mental disorder or disturbance solely in terms of the extent of treatment and medication which the disorder or disturbance necessitated. Consequently, the respondent contended, for the primary judge to reason that, to qualify as "severe", a mental disorder or disturbance must be "at the upper echelon of those disorders in [that] range"16 was to engage in a false and incomplete process of reasoning which caused the assessment of the respondent's injury to miscarry. The majority of the Court of Appeal accepted the respondent's contention. Their Honours stated17 that, although the extent of treatment made necessary by a psychiatric disorder may cast light on whether the disorder should be classed as severe, it was only one among a range of considerations that needed to be taken 15 Katanas [2015] VCC 1156 at [86]. 16 Katanas [2015] VCC 1156 at [82]. 17 Katanas v Transport Accident Commission (2016) 76 MVR 161 at 167 [19] per Ashley and Osborn JJA. Nettle Gordon Edelman into account. The correct approach, they said, was to bring to account all relevant circumstances personal to the claimant and apply the narrative test outlined in Humphries v Poljak, giving each identified relevant circumstance the weight which appears to be appropriate. They added that, in that task, a judge "will be assisted, of course, by personal experience of cases which have fallen on one side of the line or the other". Kaye JA, in dissent, concluded18 that the primary judge had not applied or adopted a test that focussed solely or primarily on the extent of treatment and symptoms to the exclusion of other consequences. In his Honour's view, it was apparent from the primary judge's reasons that he had correctly applied the narrative test by taking into account the nature of the respondent's disorder, its symptomology, its treatment, and the consequences of it for the respondent. The appellant's contentions Assuming that the majority of the Court of Appeal were correct in their characterisation of the primary judge's formulation of the "possible range", the appellant argued that there was no error in the primary judge's formulation. In the appellant's submission, given that the respondent did not complain of pecuniary or occupational consequences, and that there was no suggestion of unnecessary treatment, the range as formulated by the primary judge was not stated in a "false and incomplete way" but was appropriate and adapted to the respondent's case. Further, in the appellant's submission, by holding that the range as formulated by the primary judge was of only "limited utility"19, the majority of the Court of Appeal had "relegated what in [Humphries v Poljak] is an important part of 'the question' to a matter of 'limited utility'" and "introduced a new and unexplained concept [of] 'the line'". According to the appellant, the majority's reasoning thus had the effect of "displacing or trampling upon that part of the [Humphries v Poljak] formulation directed to the evaluation of an instant case against the range of comparable cases". And, it was said, that would place judges in the future in a quandary as to how reasons for judgment could be "framed by reference to [the range or spectrum] if any statement of the range would inevitably be erroneous for incompleteness". 18 Katanas (2016) 76 MVR 161 at 179 [77]. 19 Katanas (2016) 76 MVR 161 at 167-168 [20]. Nettle Gordon Edelman No error in the majority's reasoning The appellant's contentions should be rejected. Assuming that the majority were correct in their characterisation of the primary judge's formulation of the "possible range", it is clear that the range, as so formulated, was incomplete because it had regard to only one criterion of the comparative severity of a mental disorder or disturbance: the extent of treatment made necessary by the disorder or disturbance. That precluded consideration of other relevant criteria of comparative severity – for example, in this case, the severity of the respondent's symptoms; the severity of their consequences for her; and the extent to which the symptoms or consequences inhibited the respondent's daily activities, family life, social life and educational pursuits. Because the range as formulated was incomplete, it was prone to skew the assessment of severity and cause the assessment to miscarry. The majority of the Court of Appeal did not state that the concept of a range or spectrum of injuries, as such, was of limited utility. To the contrary, they explicitly embraced the concept of the range as part of the narrative test. As they said20: "With the qualification that regard must be had to the use of the word 'severe' in the case of mental or behavioural disturbance or disorder, the task which the judge had to undertake was that explained by Crockett and Southwell JJ in Humphries v Poljak as follows21: '[W]e think that the task of a judge confronted with the requirement to determine an application made pursuant to sub-s (4)(d) when reliance is placed upon sub-s (17)(a) may be stated in the following terms: He is to be affirmatively satisfied (the burden of proof being borne by the applicant) that the injury complained of is in fact a serious injury. To qualify for such a description there must be an impairment or loss of a body function which as a result of the infliction of the injury complained of is both serious and long-term. We think "long-term" is not an expression likely to give rise to difficulty. To be "serious" the consequences of the injury must be serious to the particular applicant. Those consequences will relate to pecuniary disadvantage and/or pain and suffering. In forming a 20 Katanas (2016) 76 MVR 161 at 165 [9] per Ashley and Osborn JJA. 21 [1992] 2 VR 129 at 140. Nettle Gordon Edelman judgment as to whether, when regard is had to such consequence, an injury is to be held to be serious the question to be asked is: can the injury, when judged by comparison with other cases in the range of possible impairments or losses, be fairly described at least as "very considerable" and certainly more than "significant" or "marked"? Beyond such guidance it is, we think, not possible to go.'" (emphasis added) As can be seen, the point of their Honours' observation22 that the range as formulated by the primary judge was of "limited utility" in the assessment of a mental disorder or disturbance was that: "a psychiatric disorder may have severe consequences, even though the sufferer has not undergone much treatment [and] the mere fact that a person has attended many doctors and undergone much treatment would not tell in favour of a disorder being severe unless the symptoms and consequences of the disorder properly call for that level of treatment." Still less did the majority displace or "trample upon" the narrative test of seriousness or severity. Very much to the contrary, after observing23 that "the task which the judge had to undertake was that explained by Crockett and Southwell JJ in Humphries v Poljak", their Honours expressly noticed24 that the only error in the primary judge's application of the narrative test was in formulating the range by reference to only one of the several criteria relevant to the assessment: "Understandably, and correctly, [the respondent's] counsel did not submit that there was any error in the judge's approach as disclosed in the passage [at [82] of the primary judge's reasons for judgment], up to and including his Honour's observation that 'consideration must be given to the vast array of mental disorders which may be encountered following a transport accident.'" Contrary also to the appellant's submissions, for the majority to conclude that the range as formulated by the primary judge was of "limited utility" in the 22 Katanas (2016) 76 MVR 161 at 167-168 [20]. 23 Katanas (2016) 76 MVR 161 at 165 [9]. 24 Katanas (2016) 76 MVR 161 at 165 [10]. Nettle Gordon Edelman assessment of a mental disorder or disturbance does not mean that any attempt to frame a relevant range or spectrum will invariably be incomplete. Rather, it rightly emphasises in plain and appropriate language that, in making an assessment of the severity of a mental disorder or disturbance by comparison to the range or spectrum of comparable cases, a judge must identify and bring to account all of the factors which emerge on the evidence as relevant to the assessment. There is nothing new in that proposition. It has been the case for the 25 years since Humphries v Poljak was decided. Contrary to the appellant's final submission, the majority's observation that a judge would be assisted by his or her personal experience of cases which have fallen "on one side of the line or the other" did not introduce a new and unexplained concept. What their Honours said was25: "We do not doubt that the extent of treatment made necessary by a psychiatric disorder may cast light on whether the disorder should be accounted as severe. But in our view the spectrum which the judge described was only one amongst a number of ways in which the question of severity might be approached, each of them being incomplete in itself. For instance, one might frame a spectrum, in a particular case, by reference to the accepted frequency and severity of the claimant's symptoms (or consequences) such as flashbacks or nightmares, or by reference to the extent of inhibitions upon the claimant's daily activities, or by reference to the extent of inhibitions upon the claimant's occupation or further education. In each instance, a spectrum could be set up, ranging from zero to very great. But whilst each spectrum would be relevant to determination whether the statutory test was satisfied in the particular case, no one of them, by itself, would answer the critical question. In our opinion, the correct thing to do, in each case, is to first identify and next bring to account all relevant circumstances personal to the claimant; and then to apply the statutory test, making a value judgment as described by Crockett and Southwell JJ in the passage [from Humphries v Poljak] cited ... above. In making that value judgment, a judge must give to each identified relevant circumstance the weight which appears to be appropriate. He or she will be assisted, of course, by personal experience of cases which have fallen on one side of the line or the other." (emphasis added) 25 Katanas (2016) 76 MVR 161 at 167 [19]. Nettle Gordon Edelman The point of the observation was evidently to emphasise, in previously sanctioned language26, the long-recognised reality that the application of the narrative test is in the end likely to turn "on the opinion of a judge familiar with a range of conditions within which the instant condition occurs"27 and thus upon the judge's conclusion as to the "side of the line" on which the case may fall. Notice of contention The respondent filed a notice of contention in this Court seeking that the orders of the Court of Appeal be upheld on the basis that the primary judge failed to give adequate reasons, particularly in relation to the effect of his Honour's findings as to credit. In the circumstances, it is unnecessary to consider that contention. Nonetheless, in that context, it may be observed that the majority made an important point about the difference between symptoms and consequences of psychological injuries compared to physical injuries28. In either case, assessment of the severity of an injury will ordinarily be informed by what is accepted as being the extent of both its symptoms and its consequences. But to speak of symptoms and consequences in the case of mental disorder or disturbance suggests a bright line distinction that may not always exist. In the case of physical injuries, the distinction tends to be clear. The majority gave as an example a claimant who suffers a spinal disc protrusion, which is an injury, that causes sciatica, which is a symptom, that causes sleeplessness, which is a consequence. Such examples can be multiplied. By contrast, in the case of mental disorder or disturbance, symptoms and consequences more often elide. No doubt, the respondent's asserted inability to undertake further education would be characterised simply as a consequence of her injury. But, as their Honours observed, her reported experience of flashbacks and nightmares might properly be described as both a symptom of her post-traumatic stress disorder, and a consequence of the disorder. It is important to bear in mind, therefore, that, in assessing the severity of mental disorders or disturbances, what might be characterised as a symptom may also be relevant as a consequence. 26 Mobilio [1998] 3 VR 833 at 836, 837, 841 per Brooking JA, 858 per Phillips JA. 27 Fleming v Hutchinson (1991) 66 ALJR 211 at 211. 28 Katanas (2016) 76 MVR 161 at 165-166 [11]. Nettle Gordon Edelman Conclusion and orders The appeal should be dismissed with costs.

HIGH COURT OF AUSTRALIA WILLMOTT GROWERS GROUP INC APPELLANT AND WILLMOTT FORESTS LIMITED (RECEIVERS AND MANAGERS APPOINTED (IN LIQUIDATION) IN ITS CAPACITY AS MANAGER OF THE UNREGISTERED MANAGED INVESTMENT SCHEMES LISTED IN SCHEDULE 2 & ORS RESPONDENTS Willmott Growers Group Inc v Willmott Forests Limited (Receivers and Managers Appointed) (In Liquidation) [2013] HCA 51 4 December 2013 ORDER Appeal dismissed with costs. On appeal from the Supreme Court of Victoria Representation G T Bigmore QC with M P Kennedy and S G Hopper for the appellant (instructed by Mills Oakley Lawyers) P D Crutchfield SC with R G Craig and D J Snyder for the first to third respondents (instructed by Arnold Bloch Leibler Lawyers) No appearance for the fourth respondent Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Willmott Growers Group Inc v Willmott Forests Limited (Receivers and Managers Appointed) (In Liquidation) Corporations law – Winding up – Insolvency – Liquidators appointed to manager of forestry investment schemes – Liquidators sought to sell assets of manager unencumbered by schemes – Assets included land over which leases granted by manager – Whether liquidators could disclaim leases granted by manager under s 568(1) of Corporations Act 2001 (Cth) – Whether lease "a contract" under s 568(1)(f) – Whether disclaimer of lease terminated tenant's estate or interest in land. Words and phrases – "effect of disclaimer", "lease of land", "property of the company that consists of ... a contract", "rights, interests, liabilities and property". Corporations Act 2001 (Cth), ss 568(1), 568(1A), 568D(1). FRENCH CJ, HAYNE AND KIEFEL JJ. The issues in the appeal A company leased land to tenants for the tenants to grow and harvest trees. The company became insolvent and is being wound up. Does Div 7A (ss 568-568F) of Pt 5.6 of the Corporations Act 2001 (Cth) ("the Act") give the company's liquidators power to disclaim the leases which the company granted? If the Act gives that power, does disclaimer terminate the tenants' rights arising under the leases? Two statutory questions and their answers The issues in this appeal present two statutory questions. Section 568(1) of the Act gives the liquidator of a company power to disclaim certain property of the company, including property that consists of a contract. Section 568D(1) provides that a disclaimer is taken to terminate, from the effective date of the disclaimer, the company's rights, interests, liabilities and property in or in respect of the disclaimer property. The relevant questions are: first, does s 568(1) give a liquidator power to disclaim a lease which the company granted to a tenant; and, second, if a liquidator has power to disclaim such a lease, what does s 568D(1) provide to be the effect of that disclaimer? Section 568(1) gives the power to disclaim. It provides: "Subject to this section, a liquidator of a company may at any time, on the company's behalf, by signed writing disclaim property of the company that consists of: land burdened with onerous covenants; or shares; or property that is unsaleable or is not readily saleable; or property that may give rise to a liability to pay money or some other onerous obligation; or property where it is reasonable to expect that the costs, charges and expenses that would be incurred in realising the property would exceed the proceeds of realising the property; or a contract; whether or not: Hayne except in the case of a contract—the liquidator has tried to sell the property, has taken possession of it or exercised an act of ownership in relation to it; or in the case of a contract—the company or the liquidator has tried to assign, or has exercised rights in relation to, the contract or any property to which it relates." The central question of construction of s 568(1) is whether a lease granted by the company to a tenant is "a contract" within the meaning of s 568(1)(f)1. Section 568(1A) of the Act provides that "[a] liquidator cannot disclaim a contract (other than an unprofitable contract or a lease of land) except with the leave of the Court" (emphasis added). Evidently, "a contract" in s 568(1)(f) includes a lease of land. Should the reference to "a lease of land" in s 568(1A) be read as referring to any lease to which the company is a party, or only to leases of land in which the company is the tenant? These reasons will show that s 568(1) should be construed as giving the liquidator of a company power to disclaim a lease granted by the company to a tenant. A lease granted by the company to a tenant is "a contract" within the meaning of s 568(1)(f). This conclusion follows both from the relevant attributes of a lease and from the reference in s 568(1A) to "a lease of land", an expression which cannot be read as confined to leases in which the company is the tenant. Section 568D prescribes the effect of a disclaimer. It provides: "(1) A disclaimer is taken to have terminated, as from the day on which it is taken because of subsection 568C(3) to take effect, the company's rights, interests, liabilities and property in or in respect of the disclaimer property, but does not affect any other person's rights or liabilities except so far as necessary in order to release the company and its property from liability. (2) A person aggrieved by the operation of a disclaimer is taken to be a creditor of the company to the extent of any loss suffered by the person because of the disclaimer and may prove such a loss as a debt in the winding up." 1 Until the enactment of the Corporate Law Reform Act 1992 (Cth), Australian company statutes had given the liquidator of a company power to disclaim "unprofitable contracts". (See, for example, Companies Act 1961 (NSW), s 296(1)(c); Companies (New South Wales) Code, s 454(1)(d); Corporations Law, s 568(1)(d).) Hayne It was not disputed that, if the liquidator has power to disclaim a lease which a company has granted to a tenant, the effect of the disclaimer is that, from the relevant day, the company's rights, interests, liabilities and property in or in respect of the lease are terminated. The appellant, Willmott Growers Group Inc ("WGG"), submitted, however, that termination of the company's rights, interests, liabilities and property in or in respect of the disclaimer property did not bring the tenant's rights to an end. that a tenant's rights and Section 568D(1) requires liabilities are terminated so far as necessary to release the company and its property from liability. These reasons will show that it necessarily follows that, from the effective date of the disclaimer, the company's liability to provide the tenant with quiet enjoyment of the leased property (and not derogate from the grant of a right to exclusive possession) and the tenant's rights to quiet enjoyment of the property (and to non-derogation from the grant of exclusive possession) are terminated. If the tenant suffers loss because of the disclaimer, the tenant may prove for that loss in the winding up2. The essential facts The first respondent, Willmott Forests Limited ("WFL"), was the manager of numerous forestry investment schemes associated with a group of companies which can be referred to as "the Willmott group". WFL, or its predecessor in title, leased to participants in those schemes portions of land which WFL owned or leased. The leases were made at various times. Each lease was for a term of years (generally 25 years) and some leases gave the tenant an option for a further term. Some leases provided for the whole of the rent due to be paid in advance; some provided for rent to be paid annually. The forestry investment schemes took different forms. It is not necessary to examine those differences in great detail. It is enough to notice that all related to forest plantations. Each investor leased an area on which trees were to be grown. Generally, each investor made a forestry management agreement with a company in the Willmott group, by which that company agreed to plant, maintain and harvest the trees. Most forestry management agreements provided for the investor to pay the relevant company an initial fee, but for the investor to pay no further sum until the trees were harvested. Some of the schemes were registered managed investment schemes under Ch 5C of the Act; others were not. No question arises in the appeal about the s 568D(2). Hayne application of Ch 5C to any of the unregistered investment schemes. The unregistered schemes were of three types, described as "contractual schemes", "partnership schemes" and "professional investor schemes". WFL acted as the responsible entity and manager of eight registered managed investment schemes and, so far as relevant to this appeal, as manager of 22 unregistered schemes. These registered and unregistered schemes (together referred to as "the Willmott schemes") related to plantation projects in six areas, described as "Bombala Victoria", "Bombala New South Wales", "Murray Valley Victoria", "Murray Valley New South Wales", "North Coast New South Wales" and "North Coast Queensland". The land used in a particular investment scheme (registered or unregistered) was not always a single contiguous block. So, for example, one of the schemes was conducted on 105 different plantations. Although trees were planted as a single plantation, and not in individual lots, one investor's lot might be adjacent to one or more lots leased to investors in other schemes. In September 2010, WFL (and other companies in the Willmott group) went into voluntary administration. Receivers and managers were also appointed to property which companies in the Willmott group had charged and the receivers and managers took possession of the charged assets. Freehold land owned by WFL in and around the town of Bombala in New South Wales, comprising 27,861 hectares, was not charged. At September 2010, about 70 per cent of that land had been planted with pine trees. In March 2011, the creditors of WFL resolved3 that the company be wound up and appointed the second and third respondents in this Court as liquidators of WFL ("the liquidators"). The liquidators concluded that the Willmott schemes could not continue to operate. The liquidators considered that it was "very unlikely" that "a party would be willing to take over as responsible entity and manager of the Willmott Schemes in circumstances where that party would be required to assume the liabilities of WFL and fund the continued operation of the Willmott Schemes without any income or contributions from [individual investors] until harvest". The liquidators further concluded that it would not be practicable to maintain separately, or harvest separately, the trees on any individual lot leased to a particular investor and that the individual investors' "right to maintain and harvest their own trees is a theoretical right which cannot be exercised". ss 439C(c) and 446A. Hayne In conjunction with the receivers and managers, the liquidators sought to sell the assets of WFL, including its freehold land and its interests as lessee of certain land on which plantations had been established. The sale campaign was said to have been run on the basis that parties could either purchase the relevant assets "unencumbered by the Willmott Schemes" or purchase those assets "encumbered by the Willmott Schemes with the ability to take over as responsible entity and manager of the schemes". Expressions of interest were received from 229 parties, of whom 92 submitted "indicative non-binding offers". No person who responded to the request for expressions of interest in purchasing assets from the liquidators or receivers and managers expressed interest in purchasing any of the assets encumbered by the Willmott schemes, or in becoming responsible entity or manager of any of the Willmott schemes. After those who had provided indicative offers were given an opportunity to examine information and documents about the assets, 54 binding offers were made to acquire assets. Separate conditional contracts of sale were then concluded with the one purchaser with respect to each of the six areas in which the Willmott schemes were conducted. Each contract provided that title to the assets the subject of the contract was to pass to the purchaser free from the encumbrances arising out of the Willmott schemes and, more particularly, that title to the trees on the land was to pass to the purchaser at settlement. Proceedings about the proposed sales Pursuant to s 511 of the Act, the liquidators applied to the Supreme Court of Victoria for directions and orders about the sales that had been negotiated. WGG and another body associated with investors who sought to continue the schemes in which they had invested, Willmott Action Group Inc ("WAG") (the fourth respondent), sought and were granted leave to intervene in the proceedings. The receivers and managers of WFL were not named as parties to the proceedings but were represented and supported the application by the liquidators. WGG and WAG acted as contradictors of the arguments advanced by the liquidators. Because of the time constraints presented by the contracts of sale that had been made, the primary judge (Davies J) ordered separate determination4 of the question: In earlier proceedings in the Federal Court of Australia, concerning the liquidators' power to terminate the Willmott schemes, Dodds-Streeton J had determined that (Footnote continues on next page) Hayne "Are the liquidators able to disclaim the Growers' leases with the effect of extinguishing the Growers' leasehold estate or interest in the subject land?" Her Honour answered5 that question "No". There were two principal elements in her Honour's reasoning. First, the negative answer was said6 to be supported by cases on "analogous" legislation, in particular, In re Bastable; Ex parte The Trustee7 (concerning the application of s 55 of the Bankruptcy Act 1883 (UK)). Second, her Honour reasoned8 that termination of the leases granted by WFL to investors was not necessary to release WFL or its property from a liability. So much followed, in her Honour's opinion9, from the fact that WFL's grant of proprietary rights to the tenants created rights in the tenants that were different from WFL's reversionary interest in the leased land. Davies J said10 that it was "unnecessary to interfere with the Growers' property rights in order to release WFL from its liability to lease because the leases have been effected" and that, accordingly, "the proviso in s 568D has no application". The liquidators appealed to the Court of Appeal. That Court (Warren CJ, Redlich JA and Sifris AJA) allowed11 the appeal, set aside the order answering the separate question "No", and ordered that the question be answered "Yes". the liquidators were justified in disclaiming the project documents relating to some of those schemes, but on condition that the liquidators seek the Court's consent before doing so. See Willmott Forests Ltd, in the matter of Willmott Forests Ltd (Receivers and Managers Appointed) (in liq) [2011] FCA 1517. 5 Re Willmott Forests Ltd (Receivers and Managers appointed) (in liq) (2012) 258 FLR 160. (2012) 258 FLR 160 at 165 [12]. (2012) 258 FLR 160 at 166 [16]. (2012) 258 FLR 160 at 166 [16]. 10 (2012) 258 FLR 160 at 166 [16]. 11 Re Willmott Forests Ltd (2012) 91 ACSR 182. Hayne The plurality in the Court of Appeal (Warren CJ and Sifris AJA) identified12 the critical question as "how far it is necessary to go (in relation to the lease of the lessee grower) in order to release WFL from liability". Their Honours noted13 that the liquidators identified that liability as (among other things) WFL's continuing obligation to provide the tenant with quiet enjoyment of the land. By contrast, WGG submitted14 that the rights of the investors as lessees had accrued or become vested before the time of any disclaimer and would therefore be preserved. Yet, as Redlich JA noted15, WGG resiled in argument from the contention that the covenant to provide quiet enjoyment was not a liability of WFL, and accepted that the primary judge had been wrong to conclude otherwise. All members of the Court of Appeal rejected16 WGG's submissions. By special leave, WGG appealed to this Court. WGG's arguments WGG advanced two principal arguments in this Court. Those arguments were: first, that the "proper" disclaimer property was WFL's unsaleable reversion, and second, that the tenants' leasehold estates would survive disclaimer of the lease contracts. It is convenient to deal with them in turn. The "proper" subject of disclaimer The liquidators seek to disclaim the leases to investors of which WFL is landlord. They do not seek to disclaim WFL's reversionary interest in the land which is subject to those leases. It will be recalled that s 568(1) gives the liquidator of a company power to disclaim "property of the company that consists of" any of six enumerated categories of property. Paragraphs (a) and (b) of s 568(1) refer to "land" and 12 (2012) 91 ACSR 182 at 188 [27]. 13 (2012) 91 ACSR 182 at 188 [28], [30]. 14 (2012) 91 ACSR 182 at 188 [29]. 15 (2012) 91 ACSR 182 at 198 [78]. 16 (2012) 91 ACSR 182 at 190 [38], 198 [79]. Hayne "shares"; pars (c), (d) and (e) refer to "property" of various kinds; and par (f) refers simply to "a contract". WGG submitted that the only "proper" subject of disclaimer in this case was WFL's reversionary interest in the land that had been leased to investors. That is, WGG submitted that only pars (a) and (c) of s 568(1) could be engaged in this case and only in respect of WFL's reversionary interest. Section 568(1), therefore, did not authorise disclaimer of the leases. It may be accepted that WFL's land subject to the leases is "land burdened with onerous covenants" (within par (a)) and is also "property that is ... not readily saleable" (within par (c)). But, as WGG's argument necessarily acknowledged, property which may be disclaimed under s 568(1) may engage more than one of the specific descriptions given in pars (a) to (e) of that sub-section. There is no foundation for reading the several forms of property enumerated in pars (a) to (f) of s 568(1) as mutually exclusive. Property which consists of "land burdened with onerous covenants" within the meaning of par (a) may also be not only "property that is unsaleable or is not readily saleable" within par (c) but also "property that may give rise to a liability to pay money or some other onerous obligation" within par (d). WGG's argument at least flirted with, perhaps even embraced, the proposition that satisfaction of a paragraph appearing earlier in s 568(1) entails that other, later, paragraphs of the sub-section are to be ignored as irrelevant or inapplicable. That cannot be right. A company may have several different kinds of property which are the subject of s 568(1). Demonstrating that one kind of property of the company (in this case its reversionary interest in land) falls within one or more of the paragraphs of s 568(1) does not entail that another kind of property of the company (here the leases to investors) cannot be disclaimed. WGG's submission might be understood as asserting that, because pars (a) and (c) of s 568(1) identify some of the rights and obligations which arise under the leases, the disclaimer of any of the rights and obligations arising under those leases must be made using the power provided by those paragraphs. If that was the argument, and it was right, it would follow that the power provided by par (f) of s 568(1) in relation to "a contract" could not be exercised. But how or why s 568(1)(f) would be read down to achieve such a result was never explained satisfactorily. WGG's argument about the "proper" subject of disclaimer must, then, be understood as in effect asserting that the leases are not property of the company for the purposes of s 568(1). That is, WGG's argument was that the sub-section provides no power to disclaim property of that kind. Hayne What is "property of the company"? Care must always be exercised17 in understanding how the word "property" is used in legal discourse. The word may be used in different senses and the very concept of "property" may be elusive18. The Act's conferral of a power to "disclaim property" can be given legally sensible operation only by reading the reference in the chapeau to s 568(1) to "property of the company" as not confined to the object in respect of which the property rights exist. Rather, the reference to "property of the company" must be read as directing attention to the legal relationship which exists between the company and the object19 (whether that object is land, shares, a contract or some other object of property). That reading of the chapeau is consistent with the Act's definition20 of "property" as "any legal or equitable estate or interest (whether present or future and whether vested or contingent) in real or personal property of any description and includ[ing] a thing in action". The breadth of the kinds of "property" with which s 568(1) deals both demonstrates and requires that no narrow meaning can be given to the legal relationships which are embraced by the word "property" whenever it is used in the provision. The word "property" should be understood as referring to the company's possession of any of a wide variety of legal rights against others in respect of some tangible or intangible object of property. If land was the only object of property with which s 568(1) dealt, the nature and extent of the property rights which may be disclaimed might usefully have been elucidated by reference only to general land law and, in particular, doctrines of estates. But s 568(1) does not deal only with property in land. It deals with a company's "property" in, among other things, bilateral contracts. In that context, as well as in other contexts in which s 568(1) must operate, doctrines of estates cannot inform, let alone limit, the scope of the word "property". 17 Yanner v Eaton (1999) 201 CLR 351 at 365-367 [17]-[19]; [1999] HCA 53. 18 Gray, "Property in Thin Air", (1991) 50 Cambridge Law Journal 252; White v Director of Public Prosecutions (WA) (2011) 243 CLR 478 at 485 [10]-[11]; [2011] HCA 20. 19 cf Yanner v Eaton (1999) 201 CLR 351 at 365-366 [17]. 20 s 9. (The text of the definition is given in the form it took at the time of the hearing before the primary judge. Nothing turns on the later amendment of the definition.) Hayne Once it is understood, as it must be, that "property" in the chapeau to s 568(1) is a compendious description of legal relationships amounting to "ownership" of objects of property (both tangible and intangible), the reference in par (f) to "a contract" must be understood as identifying, as the disclaimer property, the rights and duties which arise under the contract. The contract is the source of those rights and duties. It is then important to recognise that it is now firmly established that a lease is a species of contract. As Deane J said21 in Progressive Mailing House Pty Ltd v Tabali Pty Ltd, "[a] lease for a term of years ordinarily possesses a duality of character which can give rise to conceptual difficulties. It is both an executory contract and an executed demise" (emphasis added). Hence, as Mason J said22, "the ordinary principles of contract law, including that of termination for repudiation or fundamental breach, apply to leases". The rights and duties which a landlord and tenant have under a lease are bundles of rights and duties which together can be identified as species of property. The origins of those rights and duties lie in the contract which the landlord and tenant or their predecessors in title made. In every case, the rights and duties of the landlord and tenant, whether as an original party to the lease or as a successor in title, stem from the contract of lease and any later contract made in relation to that lease. When a company is the landlord, the rights and duties which that company has in respect of the lease are properly described as "property of the company that consists of ... a contract". The landlord's rights and duties are a form of property; those rights and duties "consist of", in the sense of derive from, the contract of lease. This conclusion, which follows from identifying the nature and source of the rights and duties which a landlord has in respect of leased land, is put beyond any doubt by the reference in s 568(1A) to "a contract ... other than a lease of land". The reference in that provision to "a lease of land" cannot be read as referring only to leases in which the company is a tenant. As WGG pointed out, the Harmer Report on Insolvency identified23 leases granted to a company as tenant as an example of onerous property which a liquidator should have power to disclaim. References to the recommendations of that report can be found in 21 (1985) 157 CLR 17 at 51; [1985] HCA 14. 22 (1985) 157 CLR 17 at 29. See also at 51-54 per Deane J; Apriaden Pty Ltd v Seacrest Pty Ltd (2005) 12 VR 319 at 321-322 [3]-[4], 334-335 [61]-[65]. 23 Australia, The Law Reform Commission, General Insolvency Inquiry, Report No 45, (1988) vol 1 at 261 [619]-[620]. Hayne extrinsic material24 relevant to the introduction, by the Corporate Law Reform Act 1992 (Cth), of provisions substantially like those now found in Div 7A of Pt 5.6 of the Act. Nothing in the extrinsic material suggests, however, that the otherwise general words of what is now s 568(1) of the Act, or the reference in s 568(1A) to "a lease of land", should be confined to leases to the relevant company. There is no textual foundation for limiting the words in that way. WGG's submission that the words should be so confined must be rejected. The leases to investors of which WFL is landlord are property of the company which may be disclaimed. Each lease is "a contract" within s 568(1)(f). To the extent to which WGG's "proper" subject of disclaimer argument depended upon denying that proposition, it should be rejected. WGG's reliance on an earlier decision WGG sought to support its proposition that the only "proper" subject of disclaimer is the company's reversionary interest in the land by reference to statements made in Bastable25. (It will be recalled that the primary judge treated26 Bastable as supporting the conclusion that the liquidators could not disclaim the leases which had been granted to investors.) WGG submitted that Bastable established that a vested interest in land cannot be brought to an end by disclaimer of the contract which created that interest. It followed in this case, so the argument continued, that because each investor has a vested interest in the land which the investor leased from WFL, the only property of the company which the liquidators can disclaim is the company's reversionary interest in the land. Bastable concerned a disclaimer by a trustee in bankruptcy, under s 55 of the Bankruptcy Act 1883 (UK)27, of a contract for the sale of a lease of land. The 24 Australia, House of Representatives, Corporate Law Reform Bill 1992, Explanatory Memorandum at [971]-[976]. 25 [1901] 2 KB 518 at 526 per Collins LJ, 527-528 per Romer LJ. 26 (2012) 258 FLR 160 at 165 [12]. 27 Section 55(1) provided, so far as presently relevant: "Where any part of the property of the bankrupt consists of land of any tenure burdened with onerous covenants, of shares or stock in companies, of unprofitable contracts, or of any other property that is unsaleable, or not readily saleable, by reason of its binding the possessor (Footnote continues on next page) Hayne contract had been made before the vendor became bankrupt. The purchaser of the lease had paid a deposit of £50. The unpaid balance of the purchase price was £40. The trustee alleged28 that carrying out the contract of sale would be "unprofitable" to the bankrupt's estate in the sense that the bankrupt's estate would be better off with the lease than it would be if the lease were transferred to the purchaser in return for payment of the balance of the purchase money that had been agreed. The Court of Appeal dismissed the trustee's appeal against the decision of a divisional court declaring the disclaimer void. The premise for the Court of Appeal's decision was that the statute did not authorise the disclaimer of the contract for sale of the lease because it was not in any relevant sense onerous property29 (as s 55 of the Bankruptcy Act required.) Completion of the contract according to its terms placed no burden on the estate or the trustee. No doubt, as WGG submitted, both Collins LJ and Romer LJ described30 the effect of the contract of sale as being to vest an interest in the purchaser which disclaimer would not affect. Indeed Romer LJ identified31 the fallacy in the trustee's argument as lying in ignoring the nature of the interest of a purchaser of real estate after a contract for its sale had been made. And in the course of argument, the Court had identified32 the purchaser's interest in the land as being ownership in equity of the property (being the lease which the bankrupt had agreed to sell). It was this interest which Romer LJ described33 as being an "interest in the land [which] would remain whatever might be the effect of a disclaimer by the trustee in the vendor's bankruptcy of the contract for sale". Hence, the actual orders made34 in Bastable required the trustee either to disclaim thereof to the performance of any onerous act, or to the payment of any sum of money, the trustee ... may ... disclaim the property." 28 [1901] 2 KB 518 at 521, 525. 29 [1901] 2 KB 518 at 525 per Collins LJ, Romer and Rigby LJJ agreeing. 30 [1901] 2 KB 518 at 526-527 per Collins LJ, 528 per Romer LJ. 31 [1901] 2 KB 518 at 528. 32 [1901] 2 KB 518 at 523. 33 [1901] 2 KB 518 at 528. 34 [1901] 2 KB 518 at 529-530. Hayne the lease which was the subject of sale or to convey the leasehold estate to the purchaser. Three points may be made about what was said in Bastable. First, the statutory provision for disclaimer considered in the case differed from the provisions which must be considered in this matter. Only "unprofitable" contracts, and other onerous property, could be disclaimed by a trustee in bankruptcy. Second, great care must be exercised in treating unqualified statements made in the course of ex tempore reasons for decision given for deciding a particular case as establishing some absolute or universally applicable gloss upon the relevant statutory provision. Especially is that so when differently worded statutory provisions are to be applied in the instant case. Third, the proposition in Bastable, that the purchaser's interest in the lease "would remain", was necessarily directed only to the consequences of disclaimer, not the ambit of the power to disclaim. It is, therefore, a proposition which does not speak directly to WGG's submission that the only "proper" subject for disclaimer is WFL's reversionary interest in the land. The proposition emphasised that terminating the vendor's liability to convey the legal title to the leasehold interest upon tender of the balance of the purchase price would leave unaffected the purchaser's equitable interest as purchaser of the leasehold. But, as these reasons will later demonstrate, when consideration is given to the effect of disclaimer, the analysis of the relationship between the parties in Bastable cannot be applied directly to the present case, if only because the relevant rights and liabilities with respect to quiet enjoyment of the leased land (and non-derogation from the grant of exclusive possession) are continuing rights and liabilities. And because those rights and liabilities are continuing, the Act can, and in this case does, bring them to an end with the consequence that from the effective date of the disclaimer there are neither the continuing rights to quiet enjoyment of the leased land (and non-derogation from the grant of exclusive possession) nor the corresponding liabilities. Termination of those rights and liabilities entails termination of the tenants' estates or interests in the land. The decision in Bastable does not support WGG's submission that the "proper" subject for disclaimer in this case was WFL's reversionary interest in the land. It is, therefore, not necessary to examine whether, as WGG submitted, on disclaimer of that reversionary interest, the land would escheat to the Crown but still be subject to whatever may be the leasehold interests of investors. Rather, it is necessary to examine the second limb of WGG's argument, which was that the investors' leasehold interests in the land would survive disclaimer. Hayne The effect of disclaimer WGG's second submission necessarily accepted that the liquidators could disclaim the leases of which WFL was landlord. It must, therefore, be taken to have proceeded from an acceptance that s 568(1) treats a company's lease of land to a tenant as "a contract" within s 568(1)(f). The effect of disclaimer is provided for, and governed, by s 568D(1), the text of which is set out earlier in these reasons. Section 568D(1) provides that, from the day on which the disclaimer takes effect, the disclaimer "is taken to have terminated ... the company's rights, interests, liabilities and property in or in respect of the disclaimer property". WGG submitted that, despite this effect on the rights, interests and liabilities of the company, the disclaimer of a lease could not operate "to destroy a third person's interest in property which existed before the disclaimer". WGG gave little prominence in argument in support of this submission to the proposition (advanced before the primary judge) that WFL's obligation to provide continuing quiet enjoyment of the leased property was not a liability of the company. Rather, the argument was advanced primarily, perhaps exclusively, by reference to three related ideas. First, emphasis was given to each lease having created an estate or interest in land. Second, by describing the tenants as "third persons" or "third parties", it was suggested that the tenants stood apart from the rights, interests and liabilities of the company which were terminated by disclaimer. And third, it was asserted that termination of the tenants' estates or interests in the land would not follow from, or be compelled by the "release [of] the company and its property from liability". WGG's argument must be rejected. The first of the three points made by WGG is undoubtedly correct. Each lease created an estate or interest in land. But the relevant question is whether the effect of the operation of the statute is that the estate or interest is brought to an end. In that respect, it is critically important to recognise that the tenants do not stand as third parties divorced from the rights, interests and liabilities of the company which are to be brought to an end. In every case the tenant is the party that has the liability, interest or right which is correlative to the relevant right, interest or liability of the company35. And contrary to the submissions of WGG, the company's rights, interests and liabilities in respect of the leases cannot be brought to an end without bringing to an end the correlative liabilities, interests and rights of the tenants. That is, to 35 cf Hindcastle Ltd v Barbara Attenborough Associates Ltd [1997] AC 70 at 87 per Lord Nicholls of Birkenhead. Hayne adopt the closing words of s 568D(1), "in order to release the company ... from liability", it is necessary to terminate the tenants' rights under the leases. This operates to terminate the tenants' estates or interests in the land. As the liquidators correctly submitted, the liabilities of WFL that would be terminated by disclaimer of the leases include its obligations to provide quiet enjoyment and not derogate from the grant of exclusive possession of the land. And as the liquidators further submitted, again correctly, it necessarily follows that the tenants' rights to quiet enjoyment and, non-derogation are terminated by the disclaimer of the leases with consequent termination of the company's correlative liabilities or duties. It follows that the tenants' estates or interests are also brought to an end36. The tenants are then left with the right to prove in the winding up as creditors for whatever damage is thereby inflicted. Questions not considered Obviously, a tenant whose lease has been disclaimed by the liquidator of a landlord may consider that being left to proof as an unsecured creditor in the winding up gives little effective compensation for what has been taken away. Whether that is so in this case was not examined in argument and is not considered. Nor has there been any occasion to consider in this case whether the liquidators require the leave of the "Court"37 before disclaiming the investors' leases or, if they do require leave, what considerations would inform the decision to grant or refuse leave. It may be noted that the Act does provide expressly, in s 568B(3), that the "Court", on application, may set aside a disclaimer "only if satisfied that the disclaimer would cause, to persons who have, or claim to have, interests in the property, prejudice that is grossly out of proportion to the prejudice that setting aside the disclaimer would cause to the company's creditors" (emphasis added). Again, however, whether or how that provision would apply in this case was not explored in argument. Conclusion and orders For these reasons, the liquidators have the power to disclaim the leases to investors. Each lease is "a contract" for the purposes of s 568(1)(f) of the Act. The liabilities of WFL (including its obligations to provide quiet enjoyment and not derogate from the grant of exclusive possession) would be terminated from the day on which the disclaimer takes effect, as would the correlative rights of 36 cf Progressive Mailing House Pty Ltd v Tabali Pty Ltd (1985) 157 CLR 17 at 37 As defined by s 58AA(1) of the Act. Hayne the tenant. Each tenant's estate or interest in the land would be terminated. The appeal should be dismissed with costs. Introduction Writing 80 years ago, William O Douglas and Jerome Frank noted that some questions which then arose in the law of insolvency would more readily be answered if commercial leases of land were to be recognised as contracts38. That development has since occurred in Australia. The question which now arises in the liquidation of Willmott Forests Ltd ("WFL") is whether the Corporations Act 2001 (Cth) ("the Act") allows the liquidators of WFL to disclaim long-term leases of forested land leased by WFL to members of investment schemes ("the Growers") with the effect of terminating the Growers' leasehold estates or interests in that land. The answer, in my view, is that the liquidators have that ability. The answer flows substantially from recognition that, despite the rent being fully paid, the Growers' leases remain contracts between WFL and the Growers under which WFL has ongoing obligations to give the Growers exclusive possession of land and from recognition that the Growers' leasehold estates or interests are proprietary interests which derive from and depend on the continuation of those contractual obligations. The liquidators' disclaimer of the Growers' leases would terminate those contractual obligations for the future and thereby bring the leasehold estates or interests to an end. Contracts, leases and leasehold interests There is a distinction between a lease, and the proprietary interest of the lessee – the leasehold estate or interest – which results from a lease. The distinction is often conflated. Windeyer J explained39: "A lease strictly means a species of conveyance, the grant of a right to the exclusive possession of land for a term less than that which the grantor has. But by a usage that is apparently metonymical in origin the word 'lease' can describe not only the grant but that which is granted, namely the term." Windeyer J had made the same distinction in different words earlier when he said that "a legal right of exclusive possession is a tenancy and the creation of such a 38 Douglas and Frank, "Landlords' Claims in Reorganizations", (1933) 42 Yale Law Journal 1003 at 1004-1005. 39 Chelsea Investments Pty Ltd v Federal Commissioner of Taxation (1966) 115 CLR 1 at 8; [1966] HCA 15. right is a demise"40. He explained that "a right to exclusive possession as against all others including [the] landlord", "when it flows from contract with the landlord, is the very essence of tenancy" and "creates an interest in land"41. Progressive Mailing House Pty Ltd v Tabali Pty Ltd42 confirmed that, save perhaps in exceptional cases, a right to the exclusive possession of land for a term is given by contract between the lessor and the lessee. The legal consequence, that rights conferred and obligations imposed by a contract that is a lease become attached to the respective estates or interests in land of the lessor and the lessee, does not detract from the underlying legal character of a lease as a species of contract. Thus, a contract giving a right to exclusive possession of land for a term less than that which the lessor has is a lease, and the proprietary interest of the lessee that results from the contractual giving of that right is a leasehold estate or interest. Whether a contract giving a right to exclusive possession of land which is not the lessor's to give might also answer the description of a lease in a particular statutory context does not now arise for consideration43. Tabali also confirmed that the proprietary interest of the lessee which results from a lease depends on the lessee's right to the exclusive possession of land continuing to have contractual force during the term. The leasehold estate or interest is an ongoing proprietary consequence of the ongoing contract between the lessor and the lessee: "[i]f the contract is avoided or dissolved", whether pursuant to the contract itself or by operation of law, "the estate in land falls with it"44. Early doubts about the generality of that proposition have now been resolved45. The leasehold estate or interest, stemming as it does from the lessee's right to the exclusive possession of land, reduces, while it remains, the lessor's own 40 Radaich v Smith (1959) 101 CLR 209 at 222; [1959] HCA 45. 41 Chelsea Investments Pty Ltd v Federal Commissioner of Taxation (1966) 115 CLR 42 (1985) 157 CLR 17; [1985] HCA 14. 43 Cf Bruton v London & Quadrant Housing Trust [2000] 1 AC 406; Gray and Gray, Elements of Land Law, 3rd ed (2001) at 326-328. 44 (1985) 157 CLR 17 at 54, quoting Cricklewood Property and Investment Trust Ltd v Leighton's Investment Trust Ltd [1945] AC 221 at 240. 45 Apriaden Pty Ltd v Seacrest Pty Ltd (2005) 12 VR 319 at 328-331 [32]-[51], 334- prior estate in the land (whether freehold or leasehold) to an estate in reversion. If and when the leasehold estate or interest ceases to exist as a consequence of the lessee's right to the exclusive possession of land ceasing to exist, the lessor's estate itself reverts to an estate in possession. The ongoing contractual right of the lessee to have exclusive possession, essential to the existence of a lease, is reciprocated in the ongoing contractual obligation of the lessor to give that exclusive possession. The precise fit between that ongoing obligation of the lessor to give exclusive possession and more specific express or implied obligations of the lessor to provide quiet enjoyment and not to derogate from the grant of the lease need not be explored46. What is plain is that "full effect cannot be given to the intention of the parties without implying an obligation that the lessor shall neither disturb the possession himself nor authorize its disturbance by others"47. Even where the rent is fully paid, a lease is therefore never fully executed during its term. To the extent, at the very least, of the lessee's ongoing right to have exclusive possession and the lessor's ongoing obligation to give exclusive possession, a lease is always "partly executory: rights and obligations remain outstanding on both sides throughout its currency"48. The now classic description by Deane J in Tabali of a lease as "both an executory contract and an executed demise" reflects not a temporal dichotomy in the contractual and proprietary operation of a lease but rather the "duality" of the character of a lease throughout its term as both a contract and a demise49. The critical point for present purposes is that, during the term of the lease, the contract and the demise are one and the same: executed as to the past, and executory as to the future. The continuity of the leasehold estate or interest conveyed by the lease depends on the continuity of the lease. Disclaimer and its effects The Act confers power on a liquidator of a company to act on the company's behalf to "disclaim property of the company that consists of", 46 Cf Goldsworthy Mining Ltd v Federal Commissioner of Taxation (1973) 128 CLR 199 at 214; [1973] HCA 7; Ryde Municipal Council v Macquarie University (1978) 139 CLR 633 at 659; [1978] HCA 58. 47 O'Keefe v Williams (1910) 11 CLR 171 at 192; [1910] HCA 40. See also at 197- 198, 200-201, 211; Miller v Emcer Products Ltd [1956] Ch 304 at 321. 48 National Carriers Ltd v Panalpina (Northern) Ltd [1981] AC 675 at 705. 49 (1985) 157 CLR 17 at 51. amongst other things, "land burdened with onerous covenants" and "a contract"50. The term "property", where used within the Act except where a contrary intention appears, "means any legal or equitable estate or interest ... in real or personal property of any description"51. A liquidator's exercise of the power to disclaim property of the company is subject to qualifications. One qualification is that the liquidator "cannot disclaim a contract (other than an unprofitable contract or a lease of land) except with the leave of the Court"52. That leave may be given, on application, subject to such conditions as the Court considers just and equitable53. Another qualification is that the liquidator must give notice of the disclaimer to each person who might have or claim an interest in the property54. The Court, on application made within a specified period after that notice, may then set aside the disclaimer if satisfied that the disclaimer would cause to such persons "prejudice that is grossly out of proportion to the prejudice that setting aside the disclaimer would cause to the company's creditors"55. The disclaimer takes effect if, and only if, such an application either is not made or is unsuccessful, and the disclaimer is then treated as having taken effect from the day after the date the liquidator gave or lodged the notice56. The statutory effect of the exercise of power by a liquidator to disclaim property of the company is then twofold. First, as from the day on which it is treated as having taken effect, the disclaimer is taken to have "terminated ... the company's rights, interests, liabilities and property in or in respect of the disclaimer property" but not to "affect any other person's rights or liabilities except so far as necessary in order to release the company and its property from liability"57. Secondly, a person aggrieved is taken to be a creditor of the 50 Section 568(1)(a) and (f). 51 Section 9. 52 Section 568(1A). 53 Section 568(1B). 54 Section 568A. 55 Section 568B. 56 Section 568C. 57 Section 568D(1). company to the extent of any loss suffered because of the disclaimer and is allowed to prove that loss as a debt in the winding up of the company58. What is apparent from the statutory language prescribing the statutory effect of a liquidator's exercise of power to disclaim property of the company is confirmed by the long history of judicial consideration of similar provisions in insolvency legislation dating back to the middle of the nineteenth century59. Disclaimer operates only prospectively to terminate the company's rights and obligations in relation to the property disclaimed; and it has no effect on the rights or obligations of any other person except so far as is necessary prospectively to release the company from its rights and obligations in relation to that property60. Thus, disclaimer does not affect a liability which the company incurred to another person in relation to the property before the disclaimer took effect61, and disclaimer does not affect an interest in the property which the company transferred to another person before the disclaimer took effect62. In re Bastable; Ex parte The Trustee63, on which much of the argument in this appeal was focused, is no more than an illustration of that latter proposition in the context of early bankruptcy legislation. It continues to be cited in a leading English text on corporate insolvency as an example of a person, who has a "real right", as opposed to a "personal claim", against a company in liquidation, remaining free to assert that right64. It can therefore be accepted that a liquidator's disclaimer of property of a company does not affect an interest in that property which the company transferred to another person before the disclaimer took effect. But a lease cannot be equated to an interest in property which has already been transferred. The critical reason, already discussed, is that the continuation of the leasehold estate or interest conveyed by the lease is necessarily contingent on the ongoing 58 Section 568D(2). 59 Section 23 of the Bankruptcy Act 1869 (UK). 60 See eg Sims v TXU Electricity Ltd (2005) 53 ACSR 295 at 300-301 [22]-[26]. 61 See eg Rothwells Ltd (In Liq) v Spedley Securities Ltd (In Liq) (1990) 20 NSWLR 417 at 422; Official Assignee of Bowen v Watt [1922] NZLR 702 at 704-705. 62 See eg Ex parte Walton; In re Levy (1881) 17 Ch D 746 at 751. 64 Goode, Principles of Corporate Insolvency Law, 4th ed (2011) at 196. To similar effect, see McQuade and Gronow, McDonald, Henry & Meek: Australian Bankruptcy Law and Practice, 6th ed (2008) at 10-3067 [133.2.25]. enjoyment of rights conferred by the lease and on the ongoing performance of obligations imposed by the lease. Just how a liquidator's exercise of power to disclaim property of the company plays out in a case where the property disclaimed comprises a lease in respect of which the company is a lessee was expounded, in the context of materially identical provisions concerning the statutory effect of a liquidator's exercise of power to disclaim, by Lord Nicholls of Birkenhead in Hindcastle Ltd v Barbara Attenborough Associates Ltd65: "Disclaimer operates to determine all the tenant's obligations under the tenant's covenants, and all his rights under the landlord's covenants. In order to determine these rights and obligations it is necessary, in the nature of things, that the landlord's obligations and rights, which are the reverse side of the tenant's rights and obligations, must also be determined. If the tenant's liabilities to the landlord are to be extinguished, of necessity so also must be the landlord's rights against the tenant. The one cannot be achieved without the other." Lord Nicholls went on to explain that disclaimer in such a case also has the further effect that "[t]he leasehold estate ceases to exist" and that the reversion expectant upon the determination of that estate is accelerated66. Like the Court of Appeal of the Supreme Court of Victoria in the decision under appeal, I cannot see that a liquidator's exercise of power to disclaim plays out in any materially different way where the property disclaimed comprises a lease in respect of which the company is a lessor. Disclaimer operates to terminate all of the company's rights and obligations as lessor. Those terminated obligations centrally include the obligation of the company to continue to give exclusive possession. If the obligation of the company to continue to give exclusive possession is terminated, the correlative right of the lessee to continue to have exclusive possession is necessarily also terminated. The consequence of the termination of the lessee's right to have exclusive possession is that the leasehold estate or interest must cease to exist. That being the effect of disclaimer of a lease, if it can occur, the question remains as to whether a lease of which the company is the lessor answers the description of "property of the company that consists of ... a contract", so as to fall within the power of the liquidator to disclaim. 65 [1997] AC 70 at 87. 66 [1997] AC 70 at 87. There is some tension between the statutory reference to property consisting of a contract and the statutory definition of property as meaning a legal or equitable estate or interest in property. The tension arises because a contract to which the company is a party, to the extent the contract remains executory, will rarely, if ever, simply confer continuing rights on the company. The contract will ordinarily also impose continuing obligations on the company. That must invariably be so in the case of an unprofitable contract, the unprofitability of which will be an incident of the likely effect on creditors of the contractual obligations continuing to be imposed on the company67. At least to the extent that the company has an ongoing obligation to pay rent or to observe any other covenants, contractual obligations of the company will also continue to exist in the case of a lease of land of which the company is lessee. The tension is resolved by the operative provision concerning the effect of disclaimer 68, which recognises that disclaimed property may in every case be property in respect of which the company has liabilities as well as rights and interests. Its effect is to enlarge in its relevant application the meaning of "property", consistent with the express qualification to the statutory definition of property, "Unless the contrary intention appears"69. The property of the company that consists of a contract able to be disclaimed therefore encompasses the totality of the executory rights and obligations the company has under that contract. That tension being resolved, full effect must be given to the express statutory acknowledgement of a lease as a species of contract. For the power of disclaimer to be enlivened to disclaim a lease, it is sufficient that the lease is a contract which remains at least in part executory and to which the company in liquidation is a party, whether as lessor or as lessee. That the reversion (if the company is lessor) might or might not also answer the description of land burdened by onerous covenants is not to the point. Such power as the liquidator has to disclaim the property of the company consisting of the reversion cannot limit the power of the liquidator to disclaim the distinct property of the company consisting of the lease. That is so even though the exercise of the power to disclaim has the ultimate effect of accelerating the reversion and can thereby be expected to enhance the value of property of the company ultimately available to the company's creditors. Those creditors would, of course, include the lessee to the extent the lessee suffered loss because of the disclaimer of the lease. The exercise of the power to disclaim the lease would always be liable to be set aside on application by the lessee were the prejudice to the lessee shown to be grossly 67 Re Real Investments Pty Ltd [2000] 2 Qd R 555 at 561 [21]. 68 Section 568D. 69 Section 9. out of proportion to the prejudice that setting aside the disclaimer would cause to the company's creditors generally. Conclusion The Growers' leases being contracts between WFL and the Growers under which WFL has ongoing obligations to give the Growers exclusive possession of land owned or leased by WFL, the liquidators of WFL have power to disclaim them. The Growers' leasehold estates or interests being proprietary interests deriving from and dependent on the continuation of those contractual obligations, disclaimer would have the effect of terminating them on and from the date the disclaimer takes effect. The answer given by the Court of Appeal to the question ordered for separate determination by the primary judge was therefore correct. The liquidators are able to disclaim the Growers' leases with the effect of terminating the Growers' leasehold estates or interests in the land on and from the date the disclaimer takes effect. The appeal should be dismissed with costs. KEANE J. Section 568(1) of the Corporations Act 2001 (Cth) ("the Act") authorises a liquidator of a company to disclaim specified categories of property of the company. The question tendered by the parties in this case is whether s 568(1) authorises a liquidator to disclaim a lease granted by the company with the effect of extinguishing the rights of the lessees in respect of the land leased to them. The question so presented conflates two issues: first, whether s 568(1) contemplates the disclaimer of a lease by the liquidator of the lessor, bearing in mind that the leasehold interest created by the lease is the property, not of the lessor but of the lessee; and secondly, whether the effect of the disclaimer is to divest the lessee of its leasehold interest in the land leaving the lessee to prove as an unsecured creditor in the winding up of the lessor. The primary judge concluded that the disclaimer did not extinguish the rights of the lessees to possession of the land leased to them. The Court of Appeal of Victoria reversed that decision, determining both issues in the affirmative. For the reasons which follow, I would resolve both issues in the negative. The proceedings The first respondent ("Willmott") was the manager of a number of forestry investment schemes, which included 15 unregistered investment schemes described as the "Contractual and Partnership Schemes". Willmott owned the freehold estate in the land, which was leased to participants in the Contractual and Partnership Schemes ("the Growers"). On 22 March 2011, Willmott was put into liquidation, and the second and third respondents were appointed its liquidators ("the Liquidators"). In the course of the winding up, the Liquidators applied to the Supreme Court of Victoria for directions in relation to the sale of Willmott's assets. The Liquidators had entered into a contract for the sale of land near Bombala. The contract was conditional on the land being free of encumbrances. The primary judge, Davies J, was asked to determine whether the Liquidators were able to disclaim the Growers' leases with the effect of extinguishing their leasehold interest in the Bombala land. The appellant was given leave to intervene in this application as representative of the Growers in four of the Contractual and Partnership Schemes operated on the land. "Exemplar" leases were tendered to the Supreme Court as part of a statement of agreed facts for the purpose of determination of the question. The leases granted the Growers, represented by the appellant, exclusive possession of their respective parcels of the Bombala land for a term of 25 years. The total rent payable to Willmott under these leases was paid in advance by the Growers. The position in relation to other leases is different; in particular, the terms are shorter and the position as to payment of rent is not clear. There are some aspects of the exemplar leases which might suggest some want of clarity of intention on the part of those responsible for their drafting; but none of the parties sought to make anything of the specific provisions of the leases. In particular, the first to third respondents were content to accept that the Growers' interests should be regarded as leases of land. In order to understand the conclusions of the primary judge and the Court of Appeal, and the arguments of the parties in this Court, it is necessary to refer to the relevant provisions of the Act. The Act Section 568 of the Act provides relevantly as follows: "(1) Subject to this section, a liquidator of a company may at any time, on the company's behalf, by signed writing disclaim property[70] of the company that consists of: land burdened with onerous covenants; or shares; or property that is unsaleable or is not readily saleable; or property that may give rise to a liability to pay money or some other onerous obligation; or property where it is reasonable to expect that the costs, charges and expenses that would be incurred in realising the property would exceed the proceeds of realising the property; or a contract; 70 Section 9 of the Corporations Act 2001 (Cth) defines "property" as being "any legal or equitable estate or interest (whether present or future and whether vested or contingent) in real or personal property of any description and includes a thing in action". whether or not: except in the case of a contract—the liquidator has tried to sell the property, has taken possession of it or exercised an act of ownership in relation to it; or in the case of a contract—the company or the liquidator has tried to assign, or has exercised rights in relation to, the contract or any property to which it relates. (1A) A liquidator cannot disclaim a contract (other than an unprofitable contract or a lease of land) except with the leave of the Court. (1B) On an application for leave under subsection (1A), the Court may: grant leave subject to such conditions; and (b) make such orders in connection with matters arising under, or relating to, the contract; as the Court considers just and equitable. (8) Where: an application in writing has been made to the liquidator by a person interested in property requiring the liquidator to decide whether he or she will disclaim the property; and the liquidator has, for the period of 28 days after the receipt of the application, or for such extended period as is allowed by the Court, declined or neglected to disclaim the property; the liquidator is not entitled to disclaim the property under this section and, in the case of a contract, he or she is taken to have adopted it. (9) The Court may, on the application of a person who is, as against the company, entitled to the benefit or subject to the burden of a contract made with the company, make an order: discharging the contract on such terms as to payment by or to either party of damages for the non-performance of the contract, or otherwise, as the Court thinks proper; or rescinding the contract on such terms as to restitution by or to either party, or otherwise, as the Court thinks proper. (10) Amounts payable pursuant to an order under subsection (9) may be proved as a debt in the winding up. (13) For the purpose of determining whether property of a company is of a kind to which subsection (1) applies, the liquidator may, by notice served on a person claiming to have an interest in the property, require the person to give to the liquidator within such period, not being less than 14 days, as is specified in the notice, a statement of the interest claimed by the person and the person must comply with the requirement." It was common ground between the parties that the reference in s 568(1)(a) to "land" is a reference to any estate or interest in land 71. It is necessary to refer as well to s 568D of the Act, which concerns the effect of disclaimer. It provides relevantly: "(1) A disclaimer is taken to have terminated … the company's rights, interests, liabilities and property in or in respect of the disclaimer property, but does not affect any other person's rights or liabilities except so far as necessary in order to release the company and its property from liability. (2) A person aggrieved by the operation of a disclaimer is taken to be a creditor of the company to the extent of any loss suffered by the person because of the disclaimer and may prove such a loss as a debt in the winding up." It is also necessary to refer to s 568B of the Act, which provides: "(1) A person who has, or claims to have, an interest in disclaimed property may apply to the Court for an order setting aside the disclaimer before it takes effect, but may only do so within 14 days after: if the liquidator gives to the person notice of the disclaimer, because of paragraph 568A(1)(b), before the end of 14 days after the liquidator lodges such notice—the liquidator gives such notice to the person; or 71 See also Acts Interpretation Act 1901 (Cth), s 2B. if paragraph (a) does not apply but notice of the disclaimer is published under subsection 568A(2) before the end of the 14 days referred to in that paragraph—the last such notice to be so published is so published; or otherwise—the liquidator lodges notice of the disclaimer. (2) On an application under subsection (1), the Court: (a) may by order set aside the disclaimer; and if it does so—may make such further orders as it thinks appropriate. (3) However, the Court may set aside a disclaimer under this section only if satisfied that the disclaimer would cause, to persons who have, or claim to have, interests in the property, prejudice that is grossly out of proportion to the prejudice that setting aside the disclaimer would cause to the company's creditors." The decision of the primary judge The primary judge accepted that the Liquidators could disclaim the leases, but reasoned that an affirmative answer to the question posed by the Liquidators failed to "give due regard to the position in law that a lease creates both contractual and proprietary rights."72 Her Honour held that a disclaimer by a liquidator under s 568(1) of the Act was not apt to "bring the tenant's proprietary interest in the land to an end."73 The decision of the Court of Appeal All members of the Court of Appeal accepted both limbs of the argument advanced for the Liquidators. As to the first limb (which concerned the first issue posed for determination by this Court), their Honours focused upon the reference in s 568D(1) of the Act to the termination of, among other things, the company's "liabilities", and proceeded to characterise Willmott's ongoing obligation under the Growers' leases to provide quiet enjoyment as a "liability" susceptible of disclaimer under s 568(1)74. That liability, once disclaimed, 72 Re Willmott Forests Ltd (2012) 258 FLR 160 at 164 [9]. 73 (2012) 258 FLR 160 at 165 [11]. 74 Re Willmott Forests Ltd (2012) 91 ACSR 182 at 188-190 [30]-[37], 198 [78]. brought the Growers' rights to an end75. This argument was also advanced in this Court. As to the second limb (which concerned the second issue posed for determination by this Court), the Court of Appeal held that, once the lease contracts were disclaimed by the Liquidators, each Grower's leasehold interest was extinguished76. Warren CJ and Sifris AJA regarded the decision of this Court in Progressive Mailing House Pty Ltd v Tabali Pty Ltd77 as establishing that, once Willmott was relieved of its contractual liabilities under each lease to provide the Grower with exclusive possession and quiet enjoyment, each Grower automatically lost its entitlement to exclusive possession under the lease78: once "the contract is disclaimed, the leasehold interest is also extinguished."79 Similarly, Redlich JA held that the effect of the disclaimer on each lease considered as a contract was decisive, in that "[w]here the estate in land is one which has come into existence by virtue of a lease contract the disclaimer of the contract involves a direct repudiation of the relation of landlord and tenant which, once accepted, brings the estate to an end."80 In the view of the Court of Appeal, the Growers would remain entitled to prove in the winding up under s 568D(2) as "a creditor of the company to the extent of any loss suffered by [them] because of the disclaimer"81. The appellant's submissions In this Court, the appellant's first submission was that the power of disclaimer engaged here is to be found in par (a) or par (c) of s 568(1) rather than in par (f). But even if s 568(1)(f) were regarded as a relevant source of power, s 568(1) empowers a liquidator to disclaim property of the company, and the 75 (2012) 91 ACSR 182 at 189-190 [37], 197 [75]-[76]. 76 (2012) 91 ACSR 182 at 190 [39], 196 [72]. 77 (1985) 157 CLR 17; [1985] HCA 14. 78 (2012) 91 ACSR 182 at 190-194 [38]-[58]. 79 (2012) 91 ACSR 182 at 190 [39]. 80 (2012) 91 ACSR 182 at 196 [72]. 81 (2012) 91 ACSR 182 at 187 [26]. leases were not Willmott's property to disclaim. Even if a lease be regarded as a contract within s 568(1)(f), the leases in question here were the property of the Growers not Willmott. The appellant's second submission was that, even if the disclaimable property of the company was Willmott's contracts to lease the land to the Growers, the rights vested in the Growers are not susceptible to extinguishment by the termination of those contracts in terms of s 568D(1) of the Act82. The appellant argued that Tabali does not stand in the way of its second submission. First, Tabali was concerned with the termination of a lease as a result of the acceptance by the lessor of a repudiation by the lessee. In the present case, there was neither repudiation by the Growers, nor acceptance by Willmott. And secondly, Tabali does not support the proposition that accrued rights are divested upon termination of a contract. The first to third respondents' submissions The first to third respondents submitted that s 568(1)(f) is the source of the Liquidators' power to disclaim a contract of the company as property capable of being disclaimed in toto. The Court of Appeal was correct to proceed on the basis that the reference to a "contract" in s 568(1)(f) is to the contract in toto so that, under s 568D(1), the effect of the disclaimer is to terminate "the company's rights, interests, liabilities and property in or in respect of" the contract. Once Willmott's rights, powers and liabilities in respect of the leases were terminated, as the Court of Appeal held83, the leasehold interest necessarily fell away84. The leasehold estate cannot exist, so it was said, following the termination of the rights and liabilities which govern its existence, and the leasehold estate cannot survive where neither lessor nor lessee is any longer bound to perform the obligations or covenants in the lease. The first to third respondents relied upon the decision in Tabali to support the propositions that a lease is essentially a contractual interest, dependent on the continued subsistence of the contract between lessor and lessee, and that as such 82 Clissold v Perry (1904) 1 CLR 363 at 373; [1904] HCA 12; Colonial Sugar Refining Co Ltd v Melbourne Harbour Trust Commissioners (1927) 38 CLR 547 at 559; [1927] AC 343 at 359; Bropho v Western Australia (1990) 171 CLR 1 at 17- 18; [1990] HCA 24; Sims (as liqs of Enron Australia Pty Ltd) v TXU Electricity Ltd (2005) 53 ACSR 295 at 300-301 [23]-[24]. 83 (2012) 91 ACSR 182 at 190 [38]-[39], 197 [75]. 84 Hindcastle Ltd v Barbara Attenborough Associates Ltd [1997] AC 70 at 85-87. it is susceptible of annihilation upon the termination of the contract. In this regard, they invoked the statement of Deane J in Tabali85: "[O]nce it is accepted that the principles of the law of contract governing termination for fundamental breach are, as a matter of theory, applicable to leases generally, there is no difficulty in applying them in the present case in much the same fashion as to an ordinary executory contract: '[i]f the contract is avoided or dissolved ... the estate in land falls with it'". The scope of s 568(1) As to the first issue for determination, it may be accepted that neither par (a) nor par (c) of s 568(1) is an exclusive source of power to disclaim a lease, and that s 568(1)(f) does empower a liquidator to disclaim the property of a company consisting of a lease. But considerations of text, context, policy, legislative history and authority support the view that the power to disclaim property of the company consisting of "a lease of land" is concerned with the property of the lessee. Textual considerations Section 568(1) confers upon a liquidator of a company power to "disclaim property of the company that consists of" the various species of property itemised in pars (a) to (f). In relation to s 568(1)(f), what may be disclaimed is property of the company which consists of "a contract". By virtue of s 568(1A) property of a company which consists of a contract "other than an unprofitable contract or a lease of land" may be disclaimed under s 568(1), but only with the leave of the court. One may accept that, as the first to third respondents argued, the inclusion of "a lease of land" in s 568(1A) is an indication by the legislature that a lease of land is included as a species of "contract" referred to in s 568(1)(f). But if one reads s 568(1)(f) exegetically with s 568(1A), it reads relevantly: "a liquidator … may … disclaim property of the company that consists of … a contract [but a] liquidator cannot disclaim a contract (other than ... a lease of land) except with the leave of the Court." That is to say, the liquidator is empowered to disclaim, without leave of the court, property consisting of a contract that is a lease of land. And as a matter of ordinary parlance, to speak of property consisting of a lease of land is to speak of the property of the lessee. To read s 568(1)(f) exegetically with s 568(1A) in this way is not to read down the express words of the provision "by making implications or imposing 85 (1985) 157 CLR 17 at 54. limitations which are not found in the express words."86 Rather, it is to give effect to all the words of sub-ss (1) and (1A) of s 568. Section 568(1)(f) proceeds on the express footing that the power to disclaim operates upon a contract which is property of the company. A contract usually confers rights and obligations upon each party to it. The postulate on which s 568(1)(f) proceeds looks to the rights conferred on the company rather than the obligations assumed by it. It is the rights conferred by a contract which make it sensible to speak of the contract as "property of the company". It is the right to possession of land conferred on the lessee which attracts the description of "a contract" to a lease of land. As a matter of ordinary parlance, "to disclaim" is to renounce or repudiate a right which the person disclaiming might otherwise enjoy. In ordinary parlance, the word "disclaimer" is primarily concerned with the disowning of rights rather than the repudiation of an obligation. According to the Macquarie Dictionary, "disclaim" means87: "1. to repudiate or deny interest in or connection with; disavow; disown: disclaiming all participation. 2. Law to renounce a claim or right to. 3. to reject the claims or authority of. … 4. Law to renounce or repudiate a legal claim or right." To the extent that "disclaim" has a technical legal meaning, that meaning is also concerned with the renunciation of a right which might otherwise be claimed by the person disclaiming. In Jowitt's Dictionary of English Law, it is said88: "To disclaim a right, interest or office is to renounce all claim to it or refuse to accept it. … Under the practice of the Court of Chancery before the Judicature Acts 1873-75, if a bill claiming relief was filed against a person who had no interest in the subject-matter of the suit, his proper course was to file a disclaimer, alleging that he had not any right or title, and that he did not and never did claim any title to the subject-matter of the suit." An understanding of the power to disclaim as primarily concerned with the renunciation of rights, rather than the repudiation of liabilities, is confirmed 86 Owners of "Shin Kobe Maru" v Empire Shipping Co Inc (1994) 181 CLR 404 at 420-421; [1994] HCA 54. See also FAI General Insurance Co Ltd v Southern Cross Exploration NL (1988) 165 CLR 268 at 283-284, 290; [1988] HCA 13. 87 Macquarie Dictionary, 5th ed (2009) at 478. 88 Jowitt's Dictionary of English Law, 2nd ed (1977) at 620-621. by the history of "disclaimer" as a concept in the law of insolvency. The disclaimer of property entered the law of insolvency in England to allow a trustee in bankruptcy to decline to accept, as part of the insolvent estate to be administered, property the realisation of which was likely to be more trouble than it was worth in terms of the due administration of the estate of the bankrupt89. Disclaimer was not, and has never been, regarded as a device whereby a trustee in bankruptcy or liquidator may effect a unilateral discharge of the liabilities of the insolvent estate: that would have been antithetical to the due administration of the estate of the insolvent person. Rather, the scope of the power to disclaim, as distinct from the consequences of its exercise, was, and has remained, limited by its focus upon the rights of the insolvent company. While a liquidator of a lessor may disclaim the lessor's property consisting of a contract to lease land, that would not be a disclaimer of the lessor's property consisting of "a lease of land". By virtue of s 568(1A) of the Act, it would be necessary for a liquidator to seek leave of the court to disclaim the lessor's contract to lease land. The Liquidators have not sought leave of the court in that regard. Contextual considerations Section 568(1) authorises a liquidator to disclaim "property of the company". Section 568D(1) provides that the effect of the disclaimer is to terminate the company's "rights, interests, liabilities and property", as well as counterparties' "rights or liabilities". It may be noted that s 568D(1) does not provide for an adverse effect upon the "property" of a counterparty. This tends to confirm that it is the rights of the company with which disclaimer is immediately or directly concerned. Section 568D(1) states the consequences of a valid disclaimer: it provides that the disclaimer of a company's rights automatically operates to release the company from its ongoing correlative liabilities; but it does not confer the power to disclaim or fix its scope. That work is done by s 568(1) of the Act. The circumstance that s 568D(1) refers expressly to the termination of the company's "liabilities" is itself an indication that they are not the focus of the power conferred by s 568(1), a provision in which that term is not used. The termination of the liabilities of the disclaiming party is the automatic legal consequence of the disclaimer of that party's rights. As Lord Nicholls of 89 Andrew, "Executory Contracts in Bankruptcy: Understanding 'Rejection'", (1988) 59 University of Colorado Law Review 845 at 858 fn 65; Ex parte Walton; In re Levy (1881) 17 Ch D 746 at 754, 756-757. Birkenhead explained in Hindcastle Ltd v Barbara Attenborough Associates Ltd, speaking of the effect of a statutory disclaimer by the liquidator of a lessee90: "In order to determine these [scil the lessee's] rights and obligations it is necessary, in the nature of things, that the landlord's obligations and rights, which are the reverse side of the tenant's rights and obligations, must also be determined." In the Court of Appeal, and in this Court, the first to third respondents identified the ongoing obligation of Willmott to provide quiet possession to the Growers as an ongoing liability of the kind that might be terminated by a disclaimer. This argument treats the provision of the Act which states the consequences of a disclaimer as controlling the scope of the power to disclaim and mistakes the true orientation of s 568(1), which is directed at the company's rights. The judges of the Court of Appeal focused upon the statement in s 568D(1) of the consequences of a disclaimer under s 568(1) for the "liabilities" of the company, and proceeded to the conclusion that Willmott's ongoing obligation as lessor to give quiet enjoyment to the Growers for the term of the leases was a "liability" of the company and, therefore, susceptible of disclaimer. The argument accepted by their Honours fixed upon the view reflected in the decision of Hodgson J in Rothwells Ltd (In Liquidation) v Spedley Securities Ltd (In Liquidation) that91: "obligations which have already accrued in the past are not liabilities which can be terminated. Liabilities which can be terminated could be such things as an obligation to arise in the future to pay money or transfer property or provide goods or services … Where an obligation has arisen but the time for performance has not arrived, or where the obligation is subject to conditions which are not yet performed, then it may be … that that is a liability which can be terminated. In some cases … a question of degree may arise whether in substance this is a fully accrued obligation which cannot be terminated, or in substance an obligation in relation to the future which can be." The Court of Appeal then concluded that because Willmott was subject to ongoing obligations to provide quiet enjoyment, that liability was sufficient to allow the Liquidators to disclaim the leases. 90 [1997] AC 70 at 87. 91 (1990) 20 NSWLR 417 at 422. But Hodgson J was speaking of the consequences of disclaimer rather than the scope of its operation. To use the statement in s 568D(1) of the consequences of an effective disclaimer of a company's rights or property as controlling the availability of the power to disclaim conferred by s 568(1) is to obscure the point that the power conferred by s 568(1) acts primarily or directly upon the property (or rights) of Willmott and only consequentially upon its liabilities. Policy considerations In Re Middle Harbour Investments Ltd (In Liq) and the Companies Act92 Bowen CJ in Eq (as his Honour then was) traced the history of the liquidator's power of disclaimer from its origins in s 23 of the Bankruptcy Act 1869 (UK), and explained that the purpose of providing a liquidator with the power to disclaim is to enable the liquidator "to rid … the company … of burdensome financial obligations which might otherwise continue to the detriment of those interested in the administration; it is given to enable … the liquidator to advance the prompt, orderly and beneficial administration … of the winding up of its affairs"93. This understanding of the purpose of the disclaimer provisions applies in relation to the Act94. Three points may be made here. First, the policy of prompt realisation of the company's assets is consistent with the view that what may be disclaimed is property of the company, whether real or personal, the continued enjoyment of which depends on meeting ongoing obligations. Secondly, the policy which informs s 568(1), as explained above, is to expedite the realisation of the money value of the company's assets in the course of the efficient administration of the insolvent estate. It is distinctly not to expand the pool of assets available to creditors by clawing back property previously disposed of by the company95. Since the introduction of the statutory power of disclaimer in 1869, neither judicial exegesis nor academic commentary has attributed to the power of disclaimer the potential to enhance the value of the estate of a company in liquidation, much less to alter the position of those who have dealt with the insolvent by divesting them of rights vested in them. 92 [1977] 2 NSWLR 652 at 657. 93 See also Ex parte Walton; In re Levy (1881) 17 Ch D 746 at 754, 756-757; In re The Nottingham General Cemetery Co [1955] Ch 683 at 695. 94 Re Real Investments Pty Ltd [2000] 2 Qd R 555 at 559-560 [15]-[16]; Global Television Pty Ltd v Sportsvision Australia Pty Ltd (in liq) (2000) 35 ACSR 484 at 95 In re Bastable; Ex parte The Trustee [1901] 2 KB 518 at 526. Thirdly, the policy which informs s 568 is not impeded by recognising that the power does not extend to the setting aside of a lease on the initiative of the liquidator of a lessor. The liquidator is at liberty to sell the reversion for whatever it may bring. That may not be much. The present is a case in point. The Growers have already paid the total rent payable by them for a term of 25 years; and the price obtainable for the reversion will reflect the circumstance that a leasehold interest of long duration has been created and no further rent can be expected for the balance of the term. To say that is simply to recognise that the Growers have paid Willmott for rights vested in them. Recent legislative history Section 568(1)(f) was introduced by the Corporate Law Reform Act 1992 (Cth). The Explanatory Memorandum to the Bill for that Act made reference to the Harmer Report on Insolvency96. In the Harmer Report, the following was said in relation to the topic of "Disclaimer"97: "The issues Trustees in bankruptcy and liquidators have a power to disclaim property where the property is, at the very least, of no benefit to the insolvent estate. The power is not frequently used, but should nevertheless exist.98 It is desirable that the provisions for disclaimer in individual and corporate insolvency be the same where possible. The provisions are already largely similar, but there are three issues in relation to which a greater degree of uniformity could be achieved: property which may be disclaimed time limits for disclaiming property and the time from which a disclaimer operates. 96 Australia, House of Representatives, Corporate Law Reform Bill 1992, Explanatory Memorandum at [971]-[976], [984]-[985]. 97 The Law Reform Commission, General Insolvency Inquiry, Report No 45, (1988), vol 1 at 258-259 [611]-[613]. 98 The power to disclaim a contract entered into by an insolvent is particularly important where a trustee or liquidator might otherwise be personally liable under the contract (as, for example, a trustee in bankruptcy in respect of a lease made by a bankrupt as lessee). Property which may be disclaimed Differences between corporate and individual insolvency. There are two main differences between individual and corporate insolvency in this area: a trustee in bankruptcy can disclaim any contract99 (although the leave of the court must be obtained for disclaiming a contract other than an unprofitable contract)100, whereas a liquidator can only disclaim unprofitable contracts101 and a liquidator can disclaim shares in corporations102 whereas a trustee in bankruptcy cannot disclaim shares unless they constitute property that is unsaleable or not readily saleable.103 Disclaimer of contracts. The power under the Bankruptcy Act to disclaim any contract was introduced in 1980. The explanatory memorandum to the amending Act stated that the new provisions would include contracts which were not actually unprofitable at the time of the disclaimer but the profitability of which may be in doubt because the property is unsaleable or not readily saleable. It also stated that the provisions would assist the trustee (subject to the control of the court whose leave would have to be sought to disclaim a contract other than an unprofitable contract) in dealing with contracts which involve difficulties The and risks Commission recommends that a similar expanded power of disclaimer should apply in the case of corporate insolvency." that would render their completion inadvisable. 99 Bankruptcy Act 1966 (Cth), s 133(1A). 100 Bankruptcy Act 1966 (Cth), s 133(5A). 101 Companies Act 1981 (Cth), s 454(1)(d). As adopted by the States in Companies (Application of Laws) Act 1981 (NSW), s 6; Companies (Application of Laws) Act 1981 (Vic), s 6; Companies (Application of Laws) Act 1982 (SA), s 6; Companies (Application of Laws) Act 1981 (Q), s 6; Companies (Application of Laws) Act 1981 (WA), s 6; Companies (Application of Laws) Act 1982 (Tas), s 6. 102 Companies Act 1981 (Cth), s 454(1)(b). 103 Bankruptcy Act 1966 (Cth), s 133(1)(b). Further, in relation to disclaimer of leases, the Harmer Report said 104: "Existing law. Special provision is made in both individual and corporate insolvency for disclaimer of a lease. A trustee in bankruptcy or a liquidator is not entitled to disclaim a lease without the leave of the court unless 28 days' notice of the intention to disclaim has been given to the lessor and any sub-lessee, and such person has not within that time required the trustee or the liquidator to apply for leave. It is difficult to discover why those affected by the disclaimer of a lease are placed in a more favourable position than others. Any person who suffers damage by reason of a disclaimer may have an admissible claim in the insolvency. Although it is essential that persons affected by the disclaimer of a lease, such as the lessor, a sub-lessee or a mortgagee of a lease be entitled to notice that the lease is being disclaimed, it does not appear justifiable to permit such persons alone to be able to require the insolvency administrator to seek the leave of the court before disclaiming. The Insolvency Act 1967 (NZ) does not place leases in a special category. recommends Recommendation. that no The Commission distinction should be drawn between the disclaimer of a lease and disclaimer of other onerous property. The Commission's recommendation for notice to be given to a person affected by a disclaimer should provide adequate protection to a person affected by the disclaimer of a lease. Such persons would still be able to protect their interests, but the trustee or liquidator would not be obliged to apply for leave as a matter of course." (footnotes omitted) These aspects of the legislative history are of some significance in relation to both aspects of the question presented to the Court. In relation to the first issue in the appeal, the first paragraph of the last passage cited above tends to confirm that, as a matter of ordinary language, to speak of "disclaiming a lease" is to speak of disclaiming a contract which is the property of the lessee. Further, in the discussion in the Explanatory Memorandum and the Harmer Report there is no revision of the basic understanding of disclaimer as a renunciation by a trustee in bankruptcy or liquidator of property as an asset of the insolvent estate to be administered by the trustee or liquidator. As to the second issue, the recent legislative history does not suggest dissent from, or dissatisfaction with, the settled understanding that the disclaimer provisions terminate executory obligations as distinct from discharging vested rights. Neither do the Explanatory Memorandum or the Harmer Report identify 104 The Law Reform Commission, General Insolvency Inquiry, Report No 45, (1988), vol 1 at 261 [619]-[620]. any mischief which would warrant an expansion of the effect of an exercise of a disclaimer to extinguish accrued rights. Nor do they recommend the adoption of any measure which would have the effect of exposing parties who have accrued rights against a company to the loss of those rights by the exercise of the power to disclaim the property of the company. The authorities In no case has it been decided that s 568(1), or any of its earlier analogues, authorises the disclaimer of a lease by the liquidator of the lessor. In a small number of cases it has been said to be arguable that a liquidator of an insolvent landlord may disclaim the lease105; but in those cases the point was not argued or decided. Thus, in Re Real Investments Pty Ltd106 Chesterman J said: "The parties are united in arguing that what is involved is whether the agreement is an unprofitable contract. Neither contends it is a lease. It may have been possible to regard the agreement as equivalent to a lease ... See the discussion of In Re Maughan; Ex parte Monkhouse (1885) 14 QBD 956 found in Disclaimer of Contracts in Bankruptcy by Melville, (1952) 15 MLR 28 at 29. Support for this view might be found in the terms of s 568(1A) which allows a liquidator to disclaim two types of contracts without the leave of the court – unprofitable contracts and leases of land. Ordinarily one might think that a 'lease of land' would constitute land which can only be disclaimed if burdened with onerous covenants (see s 568(1)(a)) but the draftsman seems to have regarded leases as a species of contract, not an interest in land, and permitted that species and one other to be disclaimed without leave. This curiosity need not detain me for the parties are content to limit their arguments to the question whether the agreement is an unprofitable contract." It is apparent that Chesterman J had s 568(1A) in mind when he spoke of a lease as one of the two species of contract that may be disclaimed without leave. It is also evident that, absent s 568(1A), his Honour would not have taken such an expansive view of the scope of s 568(1)(f) of the Act. Finally, it is also evident that his Honour did not stay to consider the operation of s 568(1A). It may well be that the absence of any judicial decision to the broad effect for which the first to third respondents contended is a reflection of the circumstance that a lease will normally be beneficial to the lessor by reason of 105 Re Jandowae Estates Pty Ltd (1989) 7 ACLC 179 at 181; Re Richmond Commercial Developments Ltd (1990) 5 NZCLC 66,336 at 66,341; Re Real Investments Pty Ltd [2000] 2 Qd R 555 at 559 [13]. 106 [2000] 2 Qd R 555 at 559 [13]. the rent which it generates. That may be so, but that might also explain the legislature's choice in s 568(1A) to treat "an unprofitable contract or a lease of land" as the specific exceptions to the rule that a contract may be disclaimed under s 568(1)(f) only with the leave of the court. It might suggest that the legislature has been content to proceed on the practical assumption that a lessor's contract to lease is beneficial to the lessor company so that leave should be required to enable leases to be disclaimed. The effect of disclaimer If the Liquidators applied to the court under s 568(1A) for leave to disclaim the contracts to lease and leave were granted, that would mean that Willmott's ongoing obligations to the Growers would be terminated; it would not mean that the Liquidators could seize possession of the leased land contrary to the rights which have accrued to each of the Growers. Termination not extinguishment Section 568D(1) speaks of the "termination" of rights and liabilities, that is to say, the bringing to an end of rights and liabilities for the future. Section 568D(1) provides that disclaimer effects a "termination", rather than an extinguishment, of rights and liabilities. It may also be noted that pars (a) and (b) of s 568(9) refer respectively to "discharging" and "rescinding", presumably to differentiate their operation from that of s 568D(1) by allowing a wider remedial discretion to the court. The authorities have consistently held that the exercise of the power to disclaim does not undo a completed transaction or divest rights which have accrued107. Thus in Hindcastle it was expressly acknowledged that the effect of a disclaimer is to release both parties from executory obligations, but not to undo The view that accrued rights are not affected by the exercise of the power to disclaim is consistent with the historical function of disclaimer in English insolvency law, which was to free the insolvent individual or company from the performance of ongoing obligations in relation to an item of property where the ongoing enjoyment of the rights attaching to that item of property required that performance. The statutory regime relating to winding up in Pt 5.6 of the Act, 107 Rothwells Ltd (In Liquidation) v Spedley Securities Ltd (In Liquidation) (1990) 20 NSWLR 417 at 422; Re Real Investments Pty Ltd [2000] 2 Qd R 555; Global Television Pty Ltd v Sportsvision Australia Pty Ltd (in liq) (2000) 35 ACSR 484 at 108 [1997] AC 70 at 75. within which s 568 appears, is concerned with the getting in of the assets of a company with a view to the payment of its debts. Section 568 provides a means to that end. In this context, s 568 does not contemplate that debts owed to creditors of the company might be extinguished, or that other completed transactions between the company and other persons might be reopened, by the exercise of the power of disclaimer. It has never been suggested that the power to disclaim authorises the annihilation by a mortgagor of the charge given in favour of the mortgagee to leave the mortgagee an unsecured creditor in the winding up. On the other hand, it has been held that it does not authorise the setting aside of an equitable interest in land. In re Bastable; Ex parte The Trustee109 is a case in point110. Bastable, prior to his bankruptcy, was the lessee of a house for a term of 99 years. He executed a mortgage of the house and later agreed to sell the equity of redemption subject to the mortgage. The purchaser paid a deposit, but Bastable became bankrupt before the balance of the purchase price had been paid. Pursuant to the Bankruptcy Act 1883 (UK) ("the Bankruptcy Act"), the trustee in bankruptcy purported to disclaim the sale contract111. 110 See also Dekala Pty Ltd (In Liq) v Perth Land & Leisure Ltd (1987) 17 NSWLR 111 Section 55 of the Bankruptcy Act 1883 (UK) provided materially: "(1) Where any part of the property of the bankrupt consists of land of any tenure burdened with onerous covenants, of shares or stock in companies, of unprofitable contracts, or of any other property that is unsaleable, or not readily saleable, by reason of its binding the possessor thereof to the performance of any onerous act, or to the payment of any sum of money, the trustee … may ... disclaim the property. The disclaimer shall operate to determine, as from the date of disclaimer, the rights, interests, and liabilities of the bankrupt and his property in or in respect of the property disclaimed, and shall also discharge the trustee from all personal liability in respect of the property disclaimed as from the date when the property vested in him, but shall not, except so far as is necessary for the purpose of (Footnote continues on next page) The Court of Appeal held that the contract of sale was not an "unprofitable contract" and therefore was not disclaimable property112. Importantly for present purposes, the Court of Appeal also held that the purchaser had an equitable interest in the land as purchaser which would remain intact notwithstanding the disclaimer. Collins LJ said113 that s 55 of the Bankruptcy Act operated within the established principle that "the trustee in bankruptcy is bound by all the equities which affect a bankrupt or a liquidating debtor" and that there is nothing in the terms of the statute whereby "the effect of a disclaimer of the contract now would be not to relieve the trustee from a burden, but to divest and take out of the purchaser the property which is already vested in him." Similarly, Romer LJ said114: "A disclaimer of a contract … cannot operate to destroy a third person's interest in property which existed before the disclaimer. No disclaimer … could … take away the equitable interest in the land which the purchaser had acquired under his contract." The first to third respondents submitted that this part of the Court of Appeal's reasoning was not necessary for its decision and that Bastable is distinguishable on the basis that it concerned a contract for the sale of land and not a lease. Finally, it was argued that the Bankruptcy Act only allowed for disclaimer of "unprofitable contracts"115. None of these considerations lessens the force of the point made by the Court of Appeal in Bastable that the materially indistinguishable terms of the predecessor of s 568(1) could not be invoked to take away from a purchaser of land the interest which a court of equity was prepared to protect. That the power to disclaim a contract (without leave of the court) is confined to "unprofitable contract[s] or a lease of land" has a bearing on the scope of the power to disclaim, but does not elucidate the effect of the disclaimer permitted by s 568(1) of the Act. releasing the bankrupt and his property and the trustee from liability, affect the rights or liabilities of any other person." 112 [1901] 2 KB 518 at 525-526. 113 [1901] 2 KB 518 at 526. 114 [1901] 2 KB 518 at 529. 115 Re Richmond Commercial Developments Ltd (1990) 5 NZCLC 66,336 at 66,341. The first to third respondents also referred to sub-ss (8) and (9) of s 568 of the Act. These sub-sections are not apt to have altered the position established by Bastable: the precursors of these provisions were sub-ss (4) and (5) of s 55 of the Bankruptcy Act considered in Bastable. In none of the extrinsic materials to which reference was made above has there been an expression of dissatisfaction with the view in Bastable that a party to a contract who has an entitlement in respect of property under the contract which is enforceable in equity is not vulnerable to the loss of that entitlement by reason of a disclaimer. Nor did the extrinsic materials suggest dissatisfaction with the view that the exercise of the power to disclaim a transaction has been understood to release, for the future, the bundle of rights and correlative obligations associated with an uncompleted transaction. In this way it facilitates the expeditious realisation of the company's assets and payment of its debts by freeing the company in liquidation from executory obligations to be performed by it over time while converting the correlative rights of the counterparty to a debt provable in the company's liquidation. Even more strongly does that conclusion flow where, as here, the obligations of the lessee as to the payment of rent have been performed and the only ongoing obligation upon the company is the observance of the covenant for quiet enjoyment when realising the money value of the reversion. Something was made in argument of the inconvenience of the present situation for the winding up. And to the suggestion that the Liquidators might solve that problem by disclaiming the reversion pursuant to s 568(1)(a), it was said that an escheat of the freehold to the Crown would be likely to be inconvenient. But that sort of inconvenience is inherent in the disclaimer of any interest in land pursuant to s 568(1)(a) of the Act. Tabali Tabali does not support a contrary view of the effect of a disclaimer. That case established that the principles relating to the termination of a contract by acceptance by one party of the other party's repudiation extend to leases. Tabali was followed in this regard by this Court in Chan v Cresdon Pty Ltd116 and Laurinda Pty Ltd v Capalaba Park Shopping Centre Pty Ltd117. All these decisions support the view that, where a lessee repudiates its executory obligations under a lease, and that repudiation is accepted by the 116 (1989) 168 CLR 242; [1989] HCA 63. 117 (1989) 166 CLR 623; [1989] HCA 23. lessor, the contractual underpinning of the lease is brought to an end and that is sufficient to terminate the lease for the future. In Tabali, however, Mason J, with whom Wilson and Dawson JJ agreed, expressly recognised the continuing relevance of considerations which may be peculiar to a lease118: lease "Repudiation or fundamental breach of a involves considerations which are not present in the case of an ordinary contract. First, the lease vests an estate or interest in land in the lessee and a complex relationship between the parties centres upon that interest in property. Secondly, this relationship has been shaped historically in very large measure by the law of property, though in recent times the relationship has been refined and developed by means of contractual arrangements. Thus, traditionally at common law a breach of a covenant by a lessee, even breach of the covenant to pay rent, conferred no right on the lessor to re-enter unless the lease reserved a right of re-entry: Lane v Dixon119; Doe d Dixon v Roe120. And in equity the proviso for re-entry was treated as a security for the payment of the rent (Howard v Fanshawe121; Ezekiel v Orakpo122), so that on payment of the rent equity would relieve against the forfeiture: Dendy v Evans123. The object and effect of s 129 of the Conveyancing Act [1919 (NSW)] was to give further protection to the lessee and to preclude forfeiture of his interest in property within the sphere of the section's operation, except in accordance with its terms. These incidents of the law of landlord and tenant indicate that mere breaches of covenant on the part of the lessee do not amount to a repudiation or fundamental breach. Indeed, it is of some significance that the instances in which courts have held that a lessee has repudiated his lease are cases in which the lessee has abandoned possession of the leased property. But too much should not be made of this as very few cases of repudiation by lessees have come before the courts. I would therefore 118 (1985) 157 CLR 17 at 33-34. 119 (1847) 3 CB 776 [136 ER 311]. 120 (1849) 7 CB 134 [137 ER 55]. 121 [1895] 2 Ch 581 at 588. 122 [1977] QB 260 at 268-269. specifically reject the appellant's submission that abandonment of possession is necessary to constitute a case of repudiation by a lessee. On the other hand, it should be acknowledged that it would be rare indeed that facts which fell short of abandonment would properly be seen as constituting repudiation by the lessee in the case of a long lease at a rental which was either nominal or but a fraction of the amount which could be obtained in the market place." (emphasis added) The observations of Mason J apply a fortiori to the case where no future rent is payable by the lessee because the whole rent has been paid "up front". In Tabali, Deane J also recognised that the ordinary contractual principles concerning termination for breach or repudiation operate only "in future" and may be subject to limitations in the case of leases. His Honour said124: "The actual application to leasehold interests of the common law doctrines of frustration and termination for fundamental breach involves some unresolved questions which are best left to be considered on a case by case basis whereby adequate attention can be focused on particular problems which might be overlooked in any effort at judicial codification. One cannot however ignore the fact that the clear trend of common law authority is to deny any general immunity of contractual leases from the operation of those doctrines of contract law … At first impression, that trend may appear to represent a step back towards the medieval days when the lessee's interest under a term of years was seen as a mere right in personam to sue the lessor for breach of covenant. Upon analysis however, it involves no more than recognition of the fact that the analogy between a leasehold and a freehold estate is an imperfect one and of the related fact that, except perhaps in the quite exceptional case of a completely unconditional demise for a long term with no rent reserved (cf Knight's Case125), the leasehold estate cannot be divorced from its origins and basis in the law of contract (cf per Atkin LJ, Matthey v Curling126): the lease should be seen as 'resting on covenant' (or contractual promise) and it is 'the contract ... and not the estate ... which is the determining factor': see per Isaacs J, Firth v Halloran127 quoting from Hallen v Spaeth128. That trend should be followed in this Court and it 124 (1985) 157 CLR 17 at 52-53. 125 (1588) 5 Co Rep 54b [77 ER 137]. 126 [1922] 2 AC 180 at 199-200. 127 (1926) 38 CLR 261 at 269; [1926] HCA 24. 128 [1923] AC 684 at 690. should be accepted that, as a general matter and subject to one qualification, the ordinary principles of contract law are applicable to contractual leases. The qualification is that the further one moves away from the case where the rights of the parties are, as a matter of substance, essentially defined by executory covenant or contractual promise to the case where the tenant's rights are, as a matter of substance, more properly to be viewed by reference to their character as an estate (albeit a chattel one) in land with a root of title in the executed demise, the more difficult it will be to establish that the lease has been avoided or terminated pursuant to the operation of the ordinary principles of frustration or fundamental breach. Indeed, one may reach the case where it would be quite artificial to regard the tenant's rights as anything other than an estate or interest in land (eg, a ninety-nine year lease of unimproved land on payment of a premium and with no rent, or only a nominal rent, reserved). In such a case, it may be difficult to envisage circumstances in which conduct of the tenant short of actual abandonment would properly be held to constitute repudiation or fundamental breach or in which anything less than a cataclysmic event such as the 'vast convulsion' referred to by Viscount Simon LC in Cricklewood Property and Investment Trust Ltd v Leighton's Investment Trust Ltd129 would warrant a frustration." (emphasis added) finding of Consistently with that view, Ormiston JA, in Apriaden Pty Ltd v Seacrest Pty Ltd130, identified, as an exception to the general rule that the principles of contract law relating to termination for repudiation or fundamental breach apply to leases, those: "cases where the lease by its very terms can be taken to have excluded conventional contractual remedies and leases of the kind where ordinary contractual remedies are effectively impossible to apply, for example, because the only consideration has been a premium and a nominal rent." The observations of Mason and Deane JJ in Tabali and those of Ormiston JA are all in accord with the fundamental principle stated by Dixon J in McDonald v Dennys Lascelles Ltd131: "When a party to a simple contract, upon a breach by the other contracting party of a condition of the contract, elects to treat the contract as no longer binding upon him, the contract is not rescinded as from the beginning. 129 [1945] AC 221 at 229. 130 (2005) 12 VR 319 at 321-322 [3]; see also at 334 [64] per Williams AJA. 131 (1933) 48 CLR 457 at 476-477; [1933] HCA 25. Both parties are discharged from the further performance of the contract, but rights are not divested or discharged which have already been unconditionally acquired. Rights and obligations which arise from the partial execution of the contract and causes of action which have accrued from its breach alike continue unaffected. When a contract is rescinded because of matters which affect its formation, as in the case of fraud, the parties are to be rehabilitated and restored, so far as may be, to the position they occupied before the contract was made. But when a contract, which is not void or voidable at law, or liable to be set aside in equity, is dissolved at the election of one party because the other has not observed an essential condition or has committed a breach going to its root, the contract is determined so far as it is executory only and the party in default is liable for damages for its breach." Two points may be made here. First, the principles relating to termination of contract discussed in Tabali operate to release each party from the performance of its obligations for the future, rather than to rescind the contract from the beginning so as to restore each party to its pre-contractual position. Secondly, the release of both parties arises in consequence of the election by the innocent party to accept the breach or repudiation by the other party as bringing the contract to an end: termination is not an outcome which can be forced on the innocent party. An effective exercise of the power to disclaim obviates any occasion for the counterparty to elect to accept the liquidator's statutorily authorised repudiation as bringing the disclaimed contract to an end. But the analogy with termination for breach does not afford any reason to treat a disclaimer as having an effect beyond releasing the parties from the future performance of obligations which remain executory. Accordingly, while a disclaimer authorised by s 568(1)(f) of the Act would be effective to relieve the liquidator from ongoing obligations under the contract disclaimed, it would not divest rights already accrued to the counterparty. The Growers' right to their interest had been unconditionally acquired by them before the purported disclaimer. A termination of the contract in such a case could not have the consequence of expropriating from the Growers the accrued rights for which they had paid, at least to the extent that a court of equity would protect by injunction the vested property rights of the Growers who have paid in full for their interest in the leases for a term of 25 years. In this regard, in National Trustees, Executors and Agency Co of Australasia Ltd v Boyd132 this Court held that a lease for a term of seven years, which was not registered as required by s 61 of the Transfer of Land Act 1915 (Vic), was effective to give the lessee an equitable lease for seven years, which 132 (1926) 39 CLR 72; [1926] HCA 44. was sufficient to defeat a claim by the successors in title of the lessor to recover possession of the premises. Knox CJ, Gavan Duffy and Rich JJ, rejecting the contention that the lease, for want of registration, could operate only as a contract and not as a lease binding the reversion, said that the lease "operates, not merely to create contractual rights and duties, but to create an equitable term of years"133. That proposition was expressly approved by Mason J in Tabali134 and by Mason CJ, Brennan, Deane and McHugh JJ in Chan135. In Chan their Honours reviewed the authorities and said136: "Although it has been stated sometimes that the equitable interest is commensurate with what a court of equity would decree to enforce the contract, whether by way of specific performance ..., the references in the earlier cases to specific performance should be understood in the sense of Sir Frederick Jordan's explanation adopted by Deane and Dawson JJ in Stern v McArthur137: 'Specific performance in this sense means not merely specific performance in the primary sense of the enforcing of an executory contract by compelling the execution of an assurance to complete it, but also the protection by injunction or otherwise of rights acquired under a contract which defines the rights of the parties'". In this case, no argument was directed to whether a court of equity might for some reason refuse to grant an injunction to protect the interests of the Growers. It is sufficient for present purposes to say that, prima facie, the Growers' interests under their leases are sufficient to support the grant of an injunction to prevent the Liquidators taking possession of the land leased to them. 133 (1926) 39 CLR 72 at 82. 134 (1985) 157 CLR 17 at 27. 135 (1989) 168 CLR 242 at 251. 136 (1989) 168 CLR 242 at 252-253. 137 (1988) 165 CLR 489 at 522; [1988] HCA 51. Conclusion and orders The two issues posed for determination should be answered as follows: (a) without the leave of the court pursuant to s 568(1A), the Liquidators' disclaimers are not effective at all; and if the Liquidators were to disclaim Willmott's contracts to lease the parcels of land in question with the leave of the court, that disclaimer would free Willmott from further observance of its obligations under the leases, but it would not be effective to deprive the Growers of their right to possession for the balance of the term, to the extent that a court of equity would restrain an attempt to deprive the Growers of their right to possession. The appeal must be allowed. The orders of the Court of Appeal should be set aside and the orders of the primary judge restored. The first to third respondents must pay the appellant's costs in the Court of Appeal and in this Court.

HIGH COURT OF AUSTRALIA AND THE KING APPELLANT RESPONDENT TL v The King [2022] HCA 35 Date of Hearing: 17 August 2022 Date of Judgment: 19 October 2022 ORDER Appeal dismissed. On appeal from the Supreme Court of New South Wales Representation J L Glissan QC with T Liu for the appellant (instructed by Jeffreys Lawyers) S C Dowling SC with M L Millward for the respondent (instructed by Director of Public Prosecutions (NSW)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS TL v The King Evidence – Criminal trial – Admissibility – Tendency evidence – Evidence Act 1995 (NSW), s 97(1)(b) – Where tendency evidence adduced to prove identity of offender – Where narrow class of possible perpetrators – Where other evidence identifying appellant as offender and tending to exclude other possible perpetrators – Whether Court of Criminal Appeal misapplied principles in Hughes v The Queen (2017) 263 CLR 338 – Whether tendency evidence required to bear close similarity to offence – Whether tendency evidence had "significant probative value". Words and phrases – "close similarity", "identity of the offender", "probative value", "serious physical harm", "significant probative value", "tendency evidence". Evidence Act 1995 (NSW), s 97(1)(b). KIEFEL CJ, GAGELER, GORDON, STEWARD AND GLEESON JJ. The appellant was convicted of the murder of his two and a half year old stepdaughter following a trial by jury in the Supreme Court of New South Wales, and consequently sentenced to imprisonment for 36 years, with a non-parole period of 27 years. The victim died as the result of blunt force trauma to her abdomen. The New South Wales Court of Criminal Appeal (Hoeben CJ at CL, Adamson and Bellew JJ) dismissed the appellant's appeal against conviction and sentence1. The single ground of appeal to this Court concerns the admission at trial of tendency evidence pursuant to s 97(1)(b) of the Evidence Act 1995 (NSW) ("the Act"). The appellant contends that the Court of Criminal Appeal erred in its application of the majority's observation in Hughes v The Queen2 that, where tendency evidence is adduced "to prove the identity of the offender for a known offence, the probative value of [the] tendency evidence will almost certainly depend upon close similarity between the conduct evidencing the tendency and the offence". Specifically, the appellant contends that the Court of Criminal Appeal was wrong to conclude that the requirement for close similarity should only arise when the tendency evidence is the only or predominant evidence that goes to identity and that a "class of exceptions" exists where there is evidence that only limited persons had the opportunity to commit the offence3, and in its conclusion that the tendency evidence had "significant probative value" as required by s 97(1)(b) of the Act. For the following reasons, the Court of Criminal Appeal was correct to conclude that the disputed evidence was admissible. Accordingly, the appeal must be dismissed. The trial The issue at trial was ultimately whether the prosecution had proved beyond reasonable doubt that the person who had inflicted the blunt force trauma to the abdomen of the victim that caused her death was the appellant and that his intention at the time was to inflict grievous bodily harm. The appellant's case was that he did not harm the victim and that the prosecution could not exclude the reasonable TL v The Queen [2020] NSWCCA 265. (2017) 263 CLR 338 at 356 [39] (emphasis added). TL [2020] NSWCCA 265 at [207]. possibility that she was killed by either of the two other persons present on the evening of her death. The victim died in the early hours of 21 April 2014 in Coffs Harbour Hospital. A forensic pathologist performed an autopsy and found that the cause of death was blunt force trauma to the abdomen. Immediately prior to the victim's admission to hospital, she had been residing with her mother and the appellant. The mother and the appellant had commenced a relationship in November 2013 and they moved into a unit in Coffs Harbour together with the victim in February 2014. On occasions, the appellant's then 14 year old nephew also stayed at the unit. The appellant, the mother and the nephew were at the unit on the evening of 20 April 2014 and there is no dispute that they were the only people who had the opportunity to inflict the injuries from which the victim died. However, as explained below, the opportunity for the appellant to have inflicted the injuries was significantly greater than the opportunity for either the mother or the nephew. In this Court, the appellant acknowledged that the prosecution case against him was a strong one. The prosecution case was that the fatal injury or injuries were inflicted by the appellant when the victim was solely in his charge between about 7.33 pm and 7.49 pm on 20 April 2014, while the mother and nephew were away from the unit buying food for dinner. There was no dispute that the victim had been put to bed in her bedroom before the mother and nephew went out; that the appellant was alone with the victim during this period; and that, when the mother and nephew arrived home, they saw the appellant coming out of the victim's bedroom into the hallway. There was no evidence that either the mother or the nephew entered the victim's bedroom after they returned to the unit with the dinner. The mother gave evidence that she did not go and check on the victim because the appellant told her that she was okay. The nephew denied having gone into the victim's bedroom on the evening of 20 April 2014. In police interviews on 21 April 2014 and 1 May 2014, the appellant gave detailed accounts of having put the victim to bed with her mother. The appellant said that the victim was talking to them, as well as to the nephew, to whom she said goodnight as she was taken into her bedroom. However, at trial, the appellant gave evidence that the mother put the victim to bed. He said that the mother was present alone in the bedroom with the victim for three to five minutes before calling him in to say goodnight, after which the appellant returned to the lounge room. The appellant's evidence was that the mother was alone with the victim in the bedroom for a further one to two minutes. The respondent submitted that the Gordon Steward Gleeson latter one to two minute period, which would only be taken to have occurred if the appellant's evidence at trial was accepted, was the only opportunity the mother had to be alone with the victim. The mother recalled putting the victim to bed on 20 April 2014 but could not recall if the appellant had helped her. The mother's evidence was that she did not notice anything unusual when she put the victim to bed. When interviewed on 21 April 2014, the nephew told police that he was present at the unit when the victim was put to bed by both the appellant and the mother. It was not in dispute that immediately after the victim was put to bed, her mother and the appellant went to the outside back patio area of the unit, where they discussed dinner. The patio area was immediately adjacent to the victim's bedroom window, which was partially open. The nephew remained on the lounge, where he was watching television. The mother nominated the period spent outside discussing dinner as half an hour or less; to police, the appellant said it was about 10 to 15 minutes, but in evidence said it was just seven minutes. Neither the mother nor the appellant heard any sounds coming from the victim's bedroom during that period. The prosecution submitted that this period was the only opportunity that the nephew had to have inflicted the fatal injuries. The nephew denied going into the victim's bedroom at any time that evening. There was also evidence that, in intercepted telephone calls with members of his family, the appellant had said that the nephew did not harm the victim and had no opportunity to do so and that the appellant did not believe the nephew to be capable of harming the victim. The appellant stated to interviewing police, and gave evidence at trial, that he went into the victim's bedroom twice whilst he was alone with her in the unit. The first time, he heard her cry, followed by the sound of the doorknob of her bedroom door. When he went to check on her, she was standing at the door crying "like she needed a spew" and some vomit or spit landed on his arm. He took her to the toilet, where she made some gagging noises but did not "spew at all", after which she said that she wanted to return to bed. The appellant gave evidence that when he checked on her a second time, the victim was making a "panting noise that she had never made before", and a "weeping noise that sounded like she had something in her throat". When asked why, in those circumstances, he closed the door to the victim's bedroom and returned to the lounge room, he said "I can't answer that" and that he did not know why he did not pick her up and take her into the lounge room. Upon the return of the mother and the nephew, the appellant started to eat dinner in the lounge room with them. Before any of them had finished, the mother decided to check on the victim. As she got up to wash her hands, the appellant went into the victim's bedroom, and brought the victim into the bathroom, where she became "floppy" and grey in colour. The appellant and the mother immediately took the victim to the emergency department at Coffs Harbour Hospital, arriving at 8.25 pm, at which point the victim was unconscious. After various procedures were performed, the victim was pronounced dead at 2.15 am on 21 April 2014. The prosecution adduced evidence from a forensic pathologist, Dr Allan Cala, who performed an autopsy on the victim. Dr Cala's evidence was that the victim would have been "immediately and severely incapacitated" after she received the blunt force trauma to her abdomen. Dr Cala's evidence was that the victim would not have appeared "normal" for any period of time after the trauma, "before deteriorating". Dr Cala's evidence was that "[t]his type of very severe trauma is seldom seen in paediatric cases, even where large forces to the abdomen are acknowledged, such as in motor vehicle trauma". On the assumption that the victim conversed with her mother and the appellant as she was put to bed and said "[g]ood night" to the nephew, Dr Cala's opinion was that she was not, at that point, suffering from the injuries he observed at autopsy. Thus, his opinion was that the injuries were occasioned sometime after the victim was put to bed. Dr Cala gave evidence that, if she had already sustained the injuries he observed, it was "highly unlikely" that the victim would have been capable of getting out of bed, walking to the bedroom door, playing with the doorknob and standing at the door while the appellant came and answered it. If the appellant's account of the victim's condition when he first went into her bedroom after the mother and the nephew left the unit were accepted, it necessarily followed that the fatal injuries had not yet been inflicted. On this basis, the respondent contended that the injuries could only have been inflicted by the appellant, who was the only person known to have had contact with the victim after the mother and the nephew left to buy dinner. This contention was disputed by the appellant, who argued that his evidence that he could not recall the mother going into the victim's bedroom before or after going to buy dinner did not exclude the possibility that the mother went into the bedroom at some point after her return from buying dinner. Disputed evidence and rulings The prosecution sought to adduce two categories of tendency evidence. The admissibility of both categories was disputed on the appeal to this Court. In an amended tendency notice dated 19 March 2017, given pursuant to s 97(1)(a) of the Act, the prosecution identified the tendency sought to be proved as the appellant's tendency to act in a particular way, namely to "deliberately inflict physical harm on the child", that is, the victim. That tendency notice was directed at the first category of evidence ("the burns evidence"). As to the burns evidence, on the first day of the trial, the trial judge (Latham J) admitted into evidence a folder of documents comprising transcripts of interviews with lay witnesses, expert evidence and photographs, in support of a contention that the appellant was responsible for placing the victim in scalding hot water on the morning of 10 April 2014 – that is, 10 days before the victim suffered the fatal injury or injuries – resulting in burns to the sides of her feet and buttocks, and that the burns were not accidentally sustained4. There was no dispute that the victim had sustained some first degree burns and one third degree burn (to her right foot) while in the appellant's care, by coming into contact with hot water. The burns evidence included evidence from Dr Christine Norrie, a forensic physician, that it would only take about five seconds for a child to suffer a third degree burn from water at a temperature of 60 degrees centigrade. Dr Norrie said that immediate and severe pain would result and that a child exposed to such hot water would "scream blue murder". Dr Norrie said that the patterns of the burns indicated that the victim was sitting in the bath when the hot water rose and burned around that part of the skin that was pressed against the floor of the bath. Dr Norrie's ultimate conclusion was that it appeared that the victim was forced to sit down in the bath. The burns evidence was capable of establishing that the appellant had deliberately immersed the victim in scalding hot water, causing the burns. The trial judge rejected the appellant's principal objection to the burns evidence, being that the prevailing evidence established that the burns were accidentally inflicted and that the appellant enjoyed a positive and caring relationship with the victim, such that the evidence lacked significant probative value. Her Honour also rejected the appellant's objection under s 101(2) of the Act, that the probative value of the evidence did not substantially outweigh any prejudicial effect it may have on him. In this Court, the appellant did not challenge the trial judge's finding with respect to s 101(2). In admitting the burns evidence, the trial judge foreshadowed a jury direction that the jury could not use the tendency evidence unless satisfied beyond reasonable doubt that the appellant deliberately placed the victim in hot water "with the intention to cause the child serious harm, and that such harm was thereby occasioned" (emphasis added). This statement indicates that the trial judge may have understood the asserted tendency to involve the deliberate infliction of serious physical harm upon the victim, and not merely physical harm. 4 R v TL [2017] NSWSC 426. The second category of tendency evidence ("the complaint evidence") was admitted in the course of the trial and comprised three pieces of hearsay evidence as evidence of the previously identified tendency. This complaint evidence was admitted without an additional tendency notice. The first piece comprised evidence from the partner of the victim's maternal uncle, Ms S, that, in late March 2014, the victim had stayed overnight at Ms S's house and Ms S noticed a bruise on the victim's right forearm. She asked the victim what had happened and the victim told her "[the appellant] did it, [the appellant] hurt me". Ms S asked her "when did he hurt you" and the victim did not answer and went off and played. The second piece of complaint evidence was a text message sent at 7.25 am on 10 April 2014 from the mother to the appellant, stating "[the victim] just came in telling me you hurt her neck again [sad face]". The third piece of complaint evidence was evidence from Ms W, the maternal grandmother of the victim. The evidence was that, some weeks before Easter 2014, the victim said "[t]hat's it Grandma, you've been naughty. I am going to ring [the appellant] and he will punch you in the face like he does to me", and the victim then pretended to punch herself. In admitting the complaint evidence, the trial judge described the asserted tendency as the tendency to behave towards the victim in an "inappropriately physical and violent fashion" (emphasis added). Again, this language indicates that her Honour may have conceived the asserted tendency as graver than the tendency stated in the amended tendency notice. Her Honour rejected the appellant's objection, under s 137 of the Act, that the probative value of the evidence was outweighed by the danger of unfair prejudice to the appellant. That conclusion was not challenged in this Court. As is apparent, the trial judge imported additional elements into the asserted tendency. These additional elements were that the tendency involved violence and the infliction of serious physical harm. Ultimately, in the trial judge's summing up, her Honour identified the relevant tendency to the jury as a tendency to deliberately inflict physical harm upon the child. Reasoning of the Court of Criminal Appeal Hoeben CJ at CL delivered the principal judgment of the Court of Criminal Appeal on the appeal against conviction. Adamson J substantially agreed and Bellew J wholly agreed. The grounds of appeal included, relevantly, that the trial judge had erred in admitting the burns evidence and the complaint evidence as tendency evidence. Gordon Steward Gleeson Burns evidence Before the Court of Criminal Appeal, the appellant contended that the burns evidence was not sufficiently similar to the blunt force trauma that caused the victim's death such that it was not admissible as tendency evidence. Hoeben CJ at CL concluded that the differences in nature and degree between the burns sustained by the victim and the blunt force trauma that caused her death were not fatal to the admissibility of the burns evidence5. His Honour considered that the burns evidence was to be assessed with the other evidence that the appellant was one of only three persons who had the opportunity to commit the alleged offence6. Considered in that context, his Honour concluded that the burns evidence had significant probative value. Hoeben CJ at CL considered that the requirement for "close similarity" between the conduct evidencing the tendency and the charged offence, identified in the majority's reasoning in Hughes, should arise when the tendency evidence is the only or predominant evidence that goes to the identity of the offender7. This case fell within the "class of exceptions" to that requirement contemplated by the majority in Hughes, noting that the undisputed fact that only three persons had the opportunity to kill the victim was "decisive evidence"8, and "of fundamental importance"9. Hoeben CJ at CL noted that the burns evidence "involved the same victim in the same house in the same family and they were close in time"10, and concluded that the identity of the victim was a matter of "close similarity" and that the burns evidence otherwise disclosed "some similarities"11. His Honour identified as a further similarity that, on the prosecution case, the incident in the bath involved a deliberate act of cruelty which was not spontaneous, because of the time required for a sufficient quantity of hot water to accumulate in the bath to TL [2020] NSWCCA 265 at [195]. TL [2020] NSWCCA 265 at [203]. TL [2020] NSWCCA 265 at [207]. TL [2020] NSWCCA 265 at [207]. TL [2020] NSWCCA 265 at [215]. 10 TL [2020] NSWCCA 265 at [208]. 11 TL [2020] NSWCCA 265 at [215]. cause the burns that were observed12. Similarly, the force needed to cause the victim's substantial injuries could only have been deliberate and not accidental13. Finally, Hoeben CJ at CL considered that the fact that the bath incident and the victim's death were "very close" in time, and the fact that they involved the same victim, "meant that even one previous episode of abuse by the [appellant] would have significant probative value in determining from the three possible suspects, who it was who murdered [the victim]"14. Adamson J considered that, in the context of the appellant's case at trial, it was not necessary for the tendency evidence to bear particular hallmarks, which could identify a perpetrator (by distinguishing them from others) on the basis of similarity of conduct, as long as the tendency evidence was significantly probative of the alleged tendency15. Her Honour considered that evidence of other acts of "spontaneous cruelty or intentional harm to the deceased were therefore highly relevant to establish the identity of the deceased's killer by establishing the alleged tendency to deliberately inflict physical harm on the deceased"16. Complaint evidence The Court of Criminal Appeal refused leave to the appellant to argue that the complaint evidence was inadmissible hearsay evidence on the basis that it did not satisfy the exceptions in s 65 or s 66 of the Act17. Hoeben CJ at CL observed that, once the complaint evidence was admitted, it was available for use as tendency evidence18. In his view, the combination of the complaint evidence and the fact that there were only three persons who could have committed the offence gave the complaint evidence significant probative value because it was capable of separating the appellant from the other two persons and identifying him as the perpetrator of the crime. His Honour concluded that the complaint evidence "taken 12 TL [2020] NSWCCA 265 at [209]. 13 TL [2020] NSWCCA 265 at [209]. 14 TL [2020] NSWCCA 265 at [224] (emphasis added). 15 TL [2020] NSWCCA 265 at [307]. 16 TL [2020] NSWCCA 265 at [308]. 17 TL [2020] NSWCCA 265 at [230], [266]. 18 TL [2020] NSWCCA 265 at [273]. at its highest does indicate a tendency to act violently towards [the victim] and if accepted by the jury, was capable of identifying the [appellant] as the person responsible for [the victim's] death"19. Similarly to the trial judge, his Honour's reasoning was based on a different and more specific tendency than appeared in the prosecution's amended tendency notice. Adamson J considered that her Honour's reasons in relation to the burns evidence also applied to the admissibility of the complaint evidence20. Assessment of the significant probative value of tendency evidence Assessment of the probative value of evidence requires that the possible use to which the evidence might be put be taken at its highest21. Taking evidence at its highest assumes that the evidence is reliable and credible22. This assumption will only be displaced where the evidence could not be accepted by a rational jury23. To be admissible under s 97(1)(b), the court must think that the evidence will have significant probative value, based on an assessment of the evidence both by itself and "having regard to other evidence adduced or to be adduced by the party seeking to adduce the evidence". For evidence to have "significant probative value", it "should make more likely, to a significant extent, the facts that make up the elements of the offence charged"24; in other words, the evidence must be "important" or "of consequence" to the assessment of the probability of the existence of a fact in issue25. It is sufficient if the disputed evidence together with 19 TL [2020] NSWCCA 265 at [276] (emphasis added). 20 TL [2020] NSWCCA 265 at [312]. IMM v The Queen (2016) 257 CLR 300 at 313 [44]; R v Bauer (a pseudonym) (2018) 266 CLR 56 at 91 [69]. IMM (2016) 257 CLR 300 at 312 [39], 315 [52]. IMM (2016) 257 CLR 300 at 312 [39]; Bauer (2018) 266 CLR 56 at 91-92 [69]. 24 Hughes (2017) 263 CLR 338 at 356 [40]. 25 Hughes (2017) 263 CLR 338 at 368-369 [81], 370 [86], 423 [215]. See also IMM (2016) 257 CLR 300 at 314 [46], 327 [103]. other evidence makes significantly more likely any facts making up the elements of the offence charged26. There is no general rule that demands or requires close similarity between the conduct evidencing the tendency and the offence27. Such a rule is not required by the text of s 97. The authorities establish that similarity is relevant to, but not determinative of, probative value28. Indeed, universal rules are to be avoided, as the relevant facts are determinative in tendency cases29. Other things being equal, evidence of a more generally expressed tendency is less likely to satisfy the threshold of "significant probative value"30. That is because, while generalised tendency notices may be supported by a broader array of evidence, that evidence will often not be significantly probative of the fact or facts in issue31. The specificity of the tendency has a direct impact on the strength of the inferential mode of reasoning32. Put in different terms, that is why tendency evidence must have significant probative value33. Otherwise, s 97 is reduced to relevance, which is addressed in s 5534. The majority's observation in Hughes as to the general requirement for "close similarity" where identity is the relevant fact in issue should be understood 26 Hughes (2017) 263 CLR 338 at 356 [40]. 27 Hughes (2017) 263 CLR 338 at 354-356 [34], [37], [39]. 28 See, eg, Hughes (2017) 263 CLR 338 at 354-356 [34], [37], [39]. 29 Hughes (2017) 263 CLR 338 at 355-356 [39]-[40], 371 [92], 392 [154], 396 [159], 30 Hughes (2017) 263 CLR 338 at 363 [64], 421-422 [208], 426 [224]. See also R v Nassif [2004] NSWCCA 433 at [51]; O'Keefe v The Queen [2009] NSWCCA 121 at [64]; El-Haddad v The Queen (2015) 88 NSWLR 93 at 113 [72]; cf Sutton v The Queen (1984) 152 CLR 528 at 535. 31 Hughes (2017) 263 CLR 338 at 363 [64], 392 [153], 426 [224]; McPhillamy v The Queen (2018) 92 ALJR 1045 at 1052 [36]-[38]; 361 ALR 13 at 21. 32 Cross on Evidence, 13th Aust ed (2021) at 842-843 [21252]. 33 Hughes (2017) 263 CLR 338 at 377 [109], 393-394 [155]. 34 Hughes (2017) 263 CLR 338 at 363 [64], 375 [105], 391 [153]. as postulating a situation in which there is little or no other evidence of identity apart from the tendency evidence, and the identity of the perpetrator is "at large"35. In this case, there was important evidence of identity, including the evidence that the appellant was one of only three persons who had the opportunity to inflict the fatal injuries and the evidence pointing against the likelihood that either the mother or the nephew was the perpetrator. In the face of this important evidence, it could not be assumed that "close similarity" between the conduct evidencing the tendency and the offence was required to meet the threshold of significant probative value. The appellant's contention that, to meet the threshold of significant probative value of identity, the asserted tendency must be able to identify an accused from the other potential perpetrators of the charged offence tends to conflate probative value and proof. In this case, the issue is whether the tendency evidence could rationally make it more likely, to a significant extent, that the appellant inflicted the blunt force trauma (or, conversely, make it more likely, to a significant extent, that the mother and the nephew did not inflict the blunt force trauma). As in Hughes, that question requires consideration of two interrelated but separate matters: (1) the extent to which the evidence supports the asserted tendency; and (2) the extent to which the asserted tendency makes more likely the fact or facts sought to be proved by the evidence36. Ultimately, the appellant did not complain that the tendency evidence lacked substantial probative value because it was directed to a tendency to deliberately inflict physical harm upon the victim, without the further specifications that the tendency involved violence and the infliction of serious harm. Those additional specifications would have significantly reduced the generality of the asserted tendency. As has been explained37, the trial judge and the prosecution imported elements into the asserted tendency in addition to those stated in the amended 35 See, eg, Ilievski v The Queen [2018] NSWCCA 164; R v UD [2020] ACTSC 45; R v Lewis [2021] NTSC 40. See also O'Keefe [2009] NSWCCA 121; Bryant v The Queen (2011) 205 A Crim R 531 at 545 [79]. 36 Hughes (2017) 263 CLR 338 at 356 [41]; McPhillamy (2018) 92 ALJR 1045 at 1050 [26], 1051-1052 [34]; 361 ALR 13 at 19, 21. See also Bauer (2018) 266 CLR 56 at 37 See [15], [20]. tendency notice. So, for example, the trial judge described it as a tendency to "behave towards the child in an inappropriately physical and violent fashion". The Court of Criminal Appeal described it as a tendency to "act violently towards [the victim]"38. There were two problems with that approach. The asserted tendency in the notice was too general, covering acts that did not necessarily involve violence; the prosecution accepted it could have included a smack, limiting its capacity to separate the appellant from the mother, "who, on the appellant's evidence, had occasionally smacked the child on the leg or thereabouts". Second, reformulation of a tendency without providing a notice under s 97(1)(a) may render evidence inadmissible39. The insufficient particularisation of the asserted tendency in the amended notice, the subsequent reformulation of that tendency absent formal amendment, the absence of a separate tendency notice for the complaint evidence, and the resulting non-compliance with s 97(1)(a), should not be condoned. Extent to which the evidence supported the tendency to deliberately inflict physical harm on the victim Ultimately, the appellant did not dispute that the burns evidence supported the asserted tendency and, further, that the third degree burn was evidence of the deliberate infliction of serious physical harm to the victim. By contrast, the appellant argued that the complaint evidence disclosed nothing about his state of mind which could provide a cogent and logical basis to infer that he deliberately hurt the victim on previous occasions, such that it could not provide proof of the asserted tendency. This submission fails to take the complaint evidence at its highest. Each item of complaint evidence was capable of supporting a conclusion that the appellant had deliberately caused serious physical harm to the victim. Having regard to the short period in which the complaints were made, between about late March 2014 and about 10 April 2014, the evidence was capable of supporting a conclusion that the appellant had a tendency to deliberately inflict serious physical harm on the victim. Extent to which the tendency made it more likely that the appellant intentionally inflicted the injuries that caused the victim's death The appellant argued that the burns and complaint evidence lacked significant probative value because it did not exhibit "close similarity" to the 38 TL [2020] NSWCCA 265 at [276]. 39 See, eg, Parkinson v Alexander [2017] ACTSC 201 at [66]-[70]. Gordon Steward Gleeson infliction of blunt force trauma that caused the victim's death. According to the appellant, the conduct that killed the victim was so unprecedented, or so extreme, that nothing that had happened in the past made it more likely that it was the appellant, rather than the mother or the nephew, who had engaged in that conduct. Without the additional elements of violent conduct inflicting serious physical harm, it is doubtful that the tendency evidence could have met the threshold of significant probative value. However, the appellant did not complain about the incorporation of those elements by the trial judge and there was no serious suggestion that both the burns evidence and the complaint evidence did not concern acts of violence and the infliction of serious physical harm. When these aspects of the tendency evidence are recognised, and having regard to the other evidence of identity, the tendency was sufficiently striking that its existence was capable of being important to a conclusion that the appellant was the perpetrator and, accordingly, the burns and complaint evidence had the requisite significant probative value for admissibility under s 97(1)(b). First, the tendency to deliberately and violently inflict serious physical harm on the victim concerned acts directed to a single person, suggesting hostility on the part of the appellant towards the victim40. Second, and noting the caution required in making an observation about human experience where there is a normal abhorrence of such a tendency41, that tendency in relation to a victim who was a very young, and necessarily defenceless, child is abnormal and therefore unlikely to be shared by other persons who had the opportunity to inflict the fatal injuries. In order to conclude that the tendency evidence had significant probative value, it was not necessary for the prosecution to neutralise or disprove the existence of the same tendency on the part of the other possible perpetrators, although, as set out above, there was evidence that made it less likely that either the mother or the nephew had the asserted tendency. Third, the probative value of the evidence was increased by the close proximity in time between the charged offence, the burns incident and the complaints: all relevant events occurred within the space of about one month. This is a case in which the threshold of significant probative value was capable of being met without the close similarity insisted upon by the appellant. Apart from the burns and complaint evidence, there was strong evidence identifying the appellant as the perpetrator. First, there was evidence that the 40 Hughes (2017) 263 CLR 338 at 392-393 [154]-[155]. See also Bauer (2018) 266 CLR 56 at 82 [48], 88 [60], concerning the sexual interest of an accused in a particular complainant. 41 Hughes (2017) 263 CLR 338 at 377 [109]. appellant was one of only three people with the requisite opportunity. Second, as explained above, the appellant was the only person who had an opportunity to inflict the fatal injuries when the others were not present, either in the unit or immediately outside the open window to the victim's bedroom. Third, there was evidence that tended to exclude the mother and the nephew as the perpetrator. In each case, their opportunity to inflict the abdominal injuries was restricted to a time when there were two other persons in close proximity and there was no evidence to suggest that either of them had acted on that limited opportunity. In the case of the mother, the evidence was that she was an attentive and caring mother who regularly sought medical attention for the victim when she was concerned for her welfare. In the case of the nephew, the appellant himself had discounted the nephew as being in any way responsible for the infliction of the abdominal injuries. Conclusion The appeal must be dismissed.

HIGH COURT OF AUSTRALIA GUMMOW ACJ, APPELLANT AND COMCARE RESPONDENT Canute v Comcare [2006] HCA 47 28 September 2006 ORDER Appeal allowed with costs. Set aside the orders of the Full Court of the Federal Court of Australia made on 16 December 2005, and in their place order that: (a) Order 1 made by Hill J on 1 April 2005 be varied so that it reads: The decision of the Administrative Appeals Tribunal dated 21 June 2004 be set aside and in place thereof direct that Comcare determine an amount payable to the Applicant assessed under ss 24 and 27 of the Safety, Rehabilitation and Compensation Act 1988 (Cth) in respect of an injury, being an adjustment disorder with anxious and depressed mood resulting in a degree of permanent impairment of the Applicant of 10 per cent as assessed pursuant to Table 5.1 of the Guide. Appeal otherwise dismissed with costs. On appeal from the Federal Court of Australia Representation L T Grey with J P Mrsic for the appellant (instructed by Carroll & O'Dea) P J Hanks QC with B H J Dube for the respondent (instructed by Phillips Fox Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Canute v Comcare Workers compensation − Injury and impairment − Liability of Comcare to pay compensation in respect of an injury which results in a permanent impairment pursuant to s 24 of the Safety, Rehabilitation and Compensation Act 1988 (Cth) ("the Act") − Where Comcare required to determined the degree of permanent impairment resulting from an injury under the approved Guide − Where s 25(4) of the Act provides that no further compensation payable in respect of a subsequent increase of less than 10 percent in the degree of impairment where Comcare has made a final assessment of the degree of permanent impairment of the employee − Where the worker sustained a physical injury to the back and also a mental injury being a post traumatic stress disorder − Where the mental injury manifested itself later in time than the physical injury − Whether s 25(4) of the Act precluded Comcare from being liable to pay compensation in respect of the mental injury because it resulted in an increase of less than 10 percent in the degree of impairment of the employee. Statute − Statutory construction − Whether repugnancy arises between s 24 and s 25(4) of the Act in circumstances where something is both an injury and produces a subsequent increase in the degree of permanent impairment of the employee. Safety, Rehabilitation and Compensation Act 1988 (Cth), ss 4, 14, 24, 25(4). GUMMOW ACJ, KIRBY, CALLINAN, HEYDON AND CRENNAN JJ. This appeal from the Full Court of the Federal Court (French and Stone JJ; Gyles J dissenting)1 raises a question of the construction and application of Div 4 of Pt II of the Safety, Rehabilitation and Compensation Act 1988 (Cth) ("the Act"). The issue involves the proper principles to be applied in determining the liability of Comcare under the Act in respect of a psychiatric injury sustained by the appellant employee, Mr Canute, subsequently to an initial physical injury he suffered. Both injuries arose out of, or in the course of, his employment. The appellant had claimed, and was awarded, lump sum compensation in respect of the physical injury. The majority of the Full Court reversed the orders of Hill J2 setting aside a determination made by the Administrative Appeals Tribunal ("the AAT"). The AAT had denied to the appellant further lump sum compensation in respect of the psychiatric injury. If the appellant is successful in this Court, the effect in ordinary circumstances would be to restore the orders made by Hill J, setting aside the AAT's decision and remitting the matter for redetermination. However the appellant also seeks an order to substitute the decision which the AAT should have made. Before looking to the facts, it is necessary to consider the legislation; without an appreciation of the legislation, the course of events does not assume its significance. The Act The Act establishes the Commonwealth workers' compensation scheme for Commonwealth employees who suffer injury or illness in the course of their employment. Part II of the Act is entitled "Compensation" and is the principal substantive part providing for the circumstances in which Comcare is liable to pay compensation to an injured employee. At the relevant time, s 14(1), which is contained in Div 1 of Pt II, provided that: "Subject to this Part, Comcare is liable to pay compensation in accordance with this Act in respect of an injury suffered by an employee if the injury results in death, incapacity for work, or impairment." 1 Comcare v Canute (2005) 148 FCR 232. 2 Canute v Comcare (2005) 40 AAR 327. Gummow ACJ Kirby Callinan Crennan Succeeding divisions of Pt II make separate provision as to the quantum of compensation for which Comcare is liable in different categories of "injury": "Injuries resulting in death" (Div 2); "Injuries resulting in incapacity for work" (Div 3); and "Injuries resulting in impairment" (Div 4). The present case is concerned with compensation for injuries resulting in impairment, pursuant to Div 4 of Pt II. Section 24 is the principal section in that division, and provides: "(1) Where an injury to an employee results in a permanent impairment, Comcare is liable to pay compensation to the employee in respect of the injury. For the purpose of determining whether an impairment is permanent, Comcare shall have regard to: the duration of the impairment; the likelihood of improvement in the employee's condition; (c) whether the employee has undertaken all reasonable rehabilitative treatment for the impairment; and any other relevant matters. Subject to this section, the amount of compensation payable to the employee is such amount, as is assessed by Comcare under subsection (4), being an amount not exceeding the maximum amount at the date of the assessment. The amount assessed by Comcare shall be an amount that is the same percentage of the maximum amount as the percentage determined by Comcare under subsection (5). Comcare shall determine the degree of permanent impairment of the employee resulting from an injury under the provisions of the approved Guide. The degree of permanent impairment shall be expressed as a percentage. Subject to section 25, if: Gummow ACJ Kirby Callinan Crennan the employee has a permanent impairment other than a hearing loss; and Comcare determines that impairment is less than 10%; the degree of permanent an amount of compensation is not payable to the employee under this section. (7A) Subject to section 25, if: the employee has a permanent impairment that is a hearing loss; and Comcare determines that the binaural hearing loss suffered by the employee is less than 5%; an amount of compensation is not payable to the employee under this section. Subsection (7) does not apply to any one or more of the following: the impairment constituted by the loss, or the loss of the use, of a finger; the impairment constituted by the loss, or the loss of the use, of a toe; the impairment constituted by the loss of the sense of taste; the impairment constituted by the loss of the sense of smell. For the purposes of this section, the maximum amount is $80,000." Section 24(1) is the general provision imposing liability upon Comcare to pay compensation where an injury results in a permanent impairment. However, s 24(4) renders s 24(5) the central provision. Section 24(5) requires Comcare to determine "the degree of permanent impairment of the employee"; this is to be expressed as a percentage (s 24(6)). The compensation payable under s 24(1) is the equivalent percentage of the "maximum amount" (s 24(3), (4), (9)), subject to the threshold in s 24(7). The content of the phrase the "degree of permanent impairment of the employee" is not specifically stated in the Act; that is left to the "approved Guide" (s 24(5)), discussed later in these reasons. Gummow ACJ Kirby Callinan Crennan Some attention must now be given to the defined terms. For the purposes of this appeal, important defined terms within s 24 are "injury" and "impairment" together with "permanent". "Injury" The concept of "an injury" is a term of pivotal importance in the structure of the Act. Section 24(1), set out above, provides that Comcare's liability to pay compensation arises in respect of "an injury". Further, Comcare's liability pursuant to s 24(1) also arises with respect to "an injury" which results in "a permanent impairment". Section 4(1) provides: "injury means: a disease suffered by an employee; or an injury (other than a disease) suffered by an employee, being a physical or mental injury arising out of, or in the course of, the employee's employment; or an aggravation of a physical or mental injury (other than a disease) suffered by an employee (whether or not that injury arose out of, or in the course of, the employee's employment), being an aggravation that arose out of, or in the course of, that employment; but does not include any such disease, injury or aggravation suffered by an employee as a result of reasonable disciplinary action taken against the employee or failure by the employee to obtain a promotion, transfer or benefit in connection with his or her employment." Sections 6, 6A and 7 are facultative provisions; indicate (in a non-exhaustive fashion) when an injury may be treated as having arisen out of, or in the course of, employment for the purposes of the Act. This operation is not called in question in this appeal. they Gummow ACJ Kirby Callinan Crennan The definition of "injury" requires some elaboration. Separate provision is made as to the meaning of "disease"3, in terms similar to those pertaining to physical or mental injuries within pars (b) and (c) of the definition of "injury". The primary concept in the definition of "disease" is "ailment", meaning "any physical or mental ailment, disorder, defect or morbid condition (whether of sudden onset or gradual development". The appellant's case is that his adjustment disorder met this description and so was "an injury" within the "disease" category. This was accepted by all members of the Full Court4. At this juncture, three things may be observed about the concept of "an injury". First, the Act does not oblige Comcare to pay compensation in respect of an employee's impairment; it is liable to pay compensation in respect of "the injury". Secondly, the term "injury" is not used in the Act in the sense of "workplace accident". The definition of "injury" is expressed in terms of the resultant effect of an incident or ailment upon the employee's body. Thirdly, the term "injury" is not used in a global sense to describe the general condition of the employee following an incident. The Act refers disjunctively to "disease" or "physical or mental" injuries and, at least to that extent, it assumes that an employee may sustain more than one "injury". The use in s 24(1) of the indefinite article in the expression "an injury" reinforces that conclusion. "Impairment" Section 24(5) of the Act is expressed in terms of "the degree of permanent impairment of the employee". This expression is said by Comcare to reflect an approach of assessing impairment on a "whole person" basis. However the definition of "impairment" is not expressed in those terms. Section 4(1) provides: 3 Section 4(1) provides: "disease means: (a) any ailment suffered by an employee; or (b) the aggravation of any such ailment; being an ailment or an aggravation that was contributed to in a material degree by the employee's employment by the Commonwealth or a licensed corporation." (2005) 148 FCR 232 at 234, 253. Gummow ACJ Kirby Callinan Crennan "impairment means the loss, the loss of the use, or the damage or malfunction, of any part of the body or of any bodily system or function or part of such system or function; permanent means likely to continue indefinitely". The definition of "impairment" (and by extension the concept of "permanent impairment") is expressed in terms of effects on bodily parts, systems and functions. This disaggregated sense of the word is reinforced by the use of the indefinite expression "a permanent impairment" in s 24(1). Textually, the Act assumes that "an injury" may result in more than one "impairment". Content is given to the expression "degree of permanent impairment of the employee" by reference to the Guide to the Assessment of the Degree of Permanent Impairment ("the Guide"), to which s 24(5) refers. The Guide is subordinate legislation which is to be prepared by Comcare and approved by the Minister pursuant to s 28 of the Act. Section 28(1) stipulates that the approved Guide set out: criteria by reference to which the degree of the permanent impairment of an employee resulting from an injury shall be determined; criteria by reference to which the degree of non-economic loss suffered by an employee as a result of an injury or impairment shall be determined; and (c) methods by which the degree of permanent impairment and the degree of non-economic loss, as determined under those criteria, shall be expressed as a percentage." It is the first edition of the Guide which is relevant to these proceedings5, and it is this which is identified in references in what follows to "the Guide". 5 The first edition of the Guide was approved by the Minister of State for Industrial Relations by notice dated 27 July 1989. It was revoked pursuant to s 28(2) of the Act on 1 September 2005 in respect of claims under ss 24, 25 or 27 of the Act received after 28 February 2006, as set out in the Guide to the Assessment of the Degree of Permanent Impairment prepared by Comcare by instrument dated (Footnote continues on next page) Gummow ACJ Kirby Callinan Crennan Part A of the Guide is concerned with permanent impairment, and Pt B is concerned with non-economic loss. Part A gives effect to the definition of "impairment" in s 4(1) of the Act by a structure which compiles descriptions of impairments into groups according to body system and by expressing each impairment as a percentage value of the functional capacity of a normal healthy person. The Guide then contains a "Combined Values Chart" in Table 14.1. This enables each impairment expressed as a percentage to be combined "to give the total effect of all impairments ... as a percentage value of the employee's whole bodily system or function". The Guide claims, in this way, to import the notion of "whole person impairment" from the American Medical Association's Guides. However, it is important to remember that recourse to the criteria and methodologies set out in the Guide is only necessary once the key statutory criterion of the occurrence of "an injury" (which resulted in at least one permanent impairment) has been fulfilled. The Guide is to be approached through the prism of each "injury". The terms of s 24(5) are quite clear; Comcare is to assess the degree of permanent impairment of the employee "resulting from an injury". Similarly, in s 24(7), the threshold permanent impairment of the employee of 10 per cent affects the amount of compensation payable "under this section"; that is, "in respect of the injury" (s 24(1)). The scheme of the Act proceeds in this way from the occurrence of "an injury", in the defined sense. As previously remarked, the Act assumes that more than one "injury" may occur. Therefore it is not correct to say that s 24(5) imports a "whole person" approach to the determination of the degree of permanent impairment. That ignores the centrality of "an injury" to the scheme upon which Comcare's liability to compensate depends. Section 25(4) It is appropriate first to refer to s 25(1). This makes provision for an employee to request Comcare to make an interim determination in certain circumstances. Upon receiving such a request, Comcare "shall" make an interim determination of the degree of permanent impairment and compensation payable in respect thereof. Section 25(2) is in similar terms to s 24(4) and mandates the 1 September 2005, and approved by the Minister on 30 September 2005. A motion in the Senate to disallow the second edition of the Guide was negatived on 29 March 2006. Gummow ACJ Kirby Callinan Crennan percentage for the amount to be awarded. Section 25(3) provides for adjustments to be made when a final determination is made after an interim determination. The operation of s 25(4) is at issue in this appeal. It must be read together with s 25(5), which has an almost identical structure. The two sub-sections state: "(4) Where Comcare has made a final assessment of the degree of permanent impairment of an employee (other than a hearing loss), no further amounts of compensation shall be payable to the employee in respect of a subsequent increase in the degree of impairment, unless the increase is 10% or more. If Comcare has made a final assessment of the degree of permanent impairment of an employee constituted by a hearing loss, no further amounts of compensation are payable to the employee in respect of a subsequent increase in the hearing loss, unless the subsequent increase in the degree of binaural hearing loss is 5% or more." It is clear that s 25(5) is intended to represent a particular qualification to the more general rule expressed in s 25(4). Both those sub-sections attained their present form following amendments made in 2001, when specific provision was made in Div 4 of Pt II for hearing loss6. At the same time, sub-ss (7) and (7A) of s 24, which impairment before compensation is "payable", were amended to their present form. Those two sub-sections are expressed to be "subject to section 25", and are displaced where an interim determination of the degree of impairment of the employee is made pursuant to that latter section. threshold percentage levels of impose Sub-sections (4) and (5) of s 25 do not immediately affect the scheme of interim payment of compensation provided for by s 25. They speak in terms of a "final assessment of the degree of permanent impairment of an employee", implicitly referring to the determination required to be made by Comcare under s 24(5) of the Act, which, it again is to be emphasised, is to be performed with reference to "an injury". For this reason, all the members of the Full Court regarded s 25(4) as a rider, qualifying s 247, and in a sense this is correct. 6 Safety, Rehabilitation and Compensation and Other Legislation Amendment Act 2001 (Cth), Sched 2, Pt 9, Items 54-55. (2005) 148 FCR 232 at 252, 253. Gummow ACJ Kirby Callinan Crennan The facts The facts relevant for the purposes of this appeal are undisputed and fall into quite a narrow compass. The appellant was born in 1957 and was employed by the Department of Defence as a civilian contractor engaged in cleaning and maintenance duties. He injured his back in the course of his employment on 19 February 1997 and again on 7 September 1998. The appellant was unfit for work for approximately three weeks following the first incident, and for two years following the second incident. On 4 November 1998, the appellant lodged a claim for rehabilitation and compensation with Comcare, citing the second incident as the occasion of his injury. Comcare allowed his claim on the basis that he had sustained work- related "aggravation of displacement of intervertebral disc-lumbar sustained on 7/9/1998". Comcare accepted liability up to and including 7 June 1999, and told the appellant that further medical evidence would be required to support a claim for compensation beyond that date. On 14 September 1999, the appellant lodged with Comcare a claim for permanent injury compensation. On this form the appellant's doctor recorded a diagnosis of his condition as "L5/S1 spondylolisthesis", and described his impairment as "[c]hronic severe back pain radiates down (R) leg". The assessing medical practitioner, Dr Lewington, assessed the appellant as having a 15 per cent whole person impairment with respect to his back injury and a 10 per cent whole person impairment with respect to his right leg. However, he assessed that 50 per cent of the appellant's condition was attributable to a condition pre-existing the work injuries. Accordingly, by letter dated 9 February 2000, Comcare made "an award of 12% whole person impairment" under s 24 of the Act, based upon the Combined Values Chart in the Guide. This amounted to $13,731.28. Comcare also awarded the appellant $15,876.80 for non-economic loss under s 27 of the Act. On 4 July 2002, the appellant lodged a second claim for permanent injury compensation. This form, which was lodged after the appellant had been referred to a psychiatrist, recorded a diagnosis of "1) L5/S1 spondylolisthesis" and "2) Adjustment disorder with depression" and described the impairment as "1) chronic severe low back pain" and "2) ongoing depression". By letter dated 29 September 2002, Comcare denied liability on the basis that the appellant had not shown an increase in whole person impairment of at least 10 per cent, as required by s 25(4) of the Act. An internal reconsideration within Comcare requested by the appellant affirmed that decision. Gummow ACJ Kirby Callinan Crennan The AAT decision The appellant sought review of Comcare's decision by the AAT. The AAT accepted that s 25(4) of the Act required the showing of an increase of at least 10 per cent to the degree of whole person impairment upon which the first award of compensation had been made. It found that the appellant's adjustment disorder "is a 10 per cent whole person impairment assessed under Table 5.1 of the Guide". However, the AAT concluded that: "Mr Canute has a permanent impairment of his back and subsequently permanent impairment arising out of the same physical injury but producing a psychological sequelae. Hence multiple impairments arising from the same incident, a physical impairment and a psychological impairment." It may be observed that the AAT here treated the concept of "injury" as co-extensive with the workplace incident which produced the impairments. As indicated earlier in these reasons, the term "injury" is not so defined by the Act. Applying the Combined Values Chart in the Guide, the AAT found that combining the 12 per cent whole person impairment in respect of the back injury (which had been the basis of the earlier award of compensation) with the 10 per cent whole person impairment found in respect of the adjustment disorder produced a whole person impairment of 21 per cent. Since this was not a 10 per cent increase on the 12 per cent whole person impairment on which the previous award had been made, the AAT determined that no further lump sum compensation was payable. The decision of Hill J The appellant sought review of the AAT decision in the Federal Court. Hill J found in the appellant's favour. On 1 April 2005, orders were made setting aside the decision and remitting the matter to the AAT for redetermination8. Hill J held that the AAT had erred in failing to consider whether the chronic adjustment disorder was itself "an injury" for the purposes of the Act. His Honour remarked that9: (2005) 40 AAR 327 at 336. (2005) 40 AAR 327 at 336. Gummow ACJ Kirby Callinan Crennan "The fact that the two injuries were caused by a single event ... is not a relevant question under the Act. The Act is concerned with injuries, not incidents." This is correct, having regard to the considerations discussed earlier in these reasons. Hill J concluded that it would be wrong to treat two separate injuries, each having different impairments, as one injury for the purposes of the Act, because10: "[t]he measure of compensation is determined by reference to percentage impairment. However, the right to compensation is created by the occurrence of an injury." His Honour concluded that the AAT had fallen into error because it characterised the adjustment disorder merely as "psychological sequelae" of the back injury, without considering whether it itself was "an injury". The Full Court judgment On appeal to the Full Court, the majority (French and Stone JJ) held that, while the AAT had erred, it had come to the right result. The error identified by the majority was not the same as that identified by Hill J. The majority acknowledged that the adjustment disorder was "plainly" an injury for the purposes of the Act11. For the majority, the error by the AAT was in assuming that an injury which is consequential upon a compensable injury is necessarily to be treated as an increase in the level of impairment attributable to that injury without addressing the relevant question; this was whether the adjustment disorder was an "impairment". Having posed that question, the majority answered it affirmatively and supported the application by the AAT of s 25(4). In his dissenting reasons, Gyles J endorsed the reasons of Hill J and added some reasons of his own. His Honour essentially was of the view that there was no ground for not applying s 24 to the psychiatric injury, given it was "an injury" 10 (2005) 40 AAR 327 at 336. 11 (2005) 148 FCR 232 at 234. Gummow ACJ Kirby Callinan Crennan for the purposes of the Act, and that, on its proper construction, s 25(4) could not affect this conclusion. The submissions on appeal On appeal to this Court, the appellant supported the reasoning of Hill J and of Gyles J that the Act requires Comcare to determine separately the impairments arising from each injury. The appellant submitted that, since the adjustment disorder was "an injury" resulting in a separate impairment, s 24 should have been applied and that should have been the end of the inquiry. Given the primacy of the concept of "injury" within the compensatory scheme, the terms of the Act mandate the operation of s 24 in respect of that "injury", in the manner for which the appellant contends. Such an outcome has both logic and simplicity to commend it. Where something is "an injury", why should not the quantum of compensation payable in respect of it be determined in the same manner for that "injury" as for any other? The effect of the reasoning of the majority in the Full Court, supported by Comcare on this appeal, denies that outcome. The reasoning must be examined, resulting as it does in disapplying s 24 (and indeed s 14(1)) of the Act to something which, on its face, is within the terms of that section. As previously indicated, the Full Court majority found error in the AAT having proceeded on the basis that an injury which is consequential upon a compensable injury is necessarily to be treated as an increase in the level of impairment attributable to that injury without addressing the relevant question of whether the adjustment disorder was an "impairment"12. The manner in which the majority put what they saw as the relevant question was inaccurate, because it departed from the terms of s 25(4). That paragraph does not inquire as to whether there is a new "impairment" resulting from the previous injury; it inquires as to whether there has been a "subsequent increase in the degree of impairment [that is, permanent impairment of an employee]". That question can only be answered by reference to the Guide (s 25(4)). In practice, and in circumstances such as those that obtain here, the occurrence of a new impairment will invariably lead to an increase of that nature by operation of the Combined Values Chart. The reasoning of the majority indicates that in substance this is 12 (2005) 148 FCR 232 at 234, 252-253. 13 (2005) 148 FCR 232 at 252. Gummow ACJ Kirby Callinan Crennan For the majority, it was critical that the "injury" constituted by the adjustment disorder could also be described as contributing to a "subsequent increase in the degree of impairment" attributable to the earlier back injury in respect of which a final determination had been made (for the purposes of s 25(4)). This was possible because of the breadth of the statutory definition of "impairment". In those circumstances, the majority construed the Act as requiring that the relevant condition only be treated as going to "impairment" and not as a separate "injury" resulting in an impairment. Upon that reasoning the injury constituted by the adjustment disorder did not give rise to a separate liability under s 24 of the Act because it was also an impairment resulting from the back injury. The majority identified a legislative policy to support this construction with reference to two considerations. First, their Honours referred to the importance of the "whole person" approach in the scheme of the Act, referring to the Minister's Second Reading Speech, where he said14: "Under the existing Act [the Compensation (Commonwealth Government Employees) Act 1971 (Cth)], lump sum payments are made on the basis of a table of maims, with the level of payment being determined having regard to the loss, or loss of the efficient use, of various parts of the body. That approach has been abandoned and the level of payments in future will be determined using a 'whole person' approach, similar to that used under the Veterans' Entitlements Act 1986." Secondly, the majority referred to a legislative policy of imposing limits on recoverable compensation15. Comcare submits that s 25(4) should be construed as a further limit on recoverable compensation, applying in cases where multiple impairments result from the same "injury". Construction of the Act 14 Australia, House of Representatives, Parliamentary Debates (Hansard), 27 April 15 (2005) 148 FCR 232 at 252. Gummow ACJ Kirby Callinan Crennan Reduced to its essentials, the conclusion of the Full Court majority depended upon the proposition that16: "the policy of [the Act] seems to require such an injury to be treated as an aspect of the impairment created by the initial injury". It is clear from the context that what was being referred to was what the majority described as a "consequential injury", a notion supported by Comcare in terms of "primary" and "secondary" injuries. Comcare's case depends upon confining the meaning of "injury" to exclude such "consequential injuries". However, there is no foundation in the Act for any such distinction between "an injury" and a consequential or secondary injury. Neither of these qualifiers finds any expression in the Act. The Act speaks exclusively in terms of "an injury". In effect, the majority appears to have discerned a repugnancy or conflict between s 24 and s 25(4). That is said to arise in the particular circumstance where something can answer the description of "an injury" and also would, if it were taken into account in a s 25(4) inquiry, produce a "subsequent increase in the degree of impairment" from that found by Comcare in a "determination of permanent impairment of the employee" made in respect of a different injury. However, there is no relevant conflict between the provisions. As Gyles J demonstrated in the Full Court, it is possible to construe the reference in s 25(4) to a "subsequent increase in the degree of impairment" as referring to an increase based upon increases in the same kind of "impairment" which had rendered Comcare liable and upon which the final assessment had previously been made17. His Honour referred to s 25(5) as an expression of that very construction, albeit with greater particularity (making special provision with respect to one kind of permanent impairment). In referring to increases in the degree of impairment, s 25(4) does not include a separate "injury" resulting in a separate permanent impairment which must be individually assessed. Since the adjustment disorder had nothing to do with the impairments previously assessed by Comcare resulting from the back injury, s 25(4) was inapplicable. If this construction is open, why should the Court regard s 24 and s 25(4) as repugnant in the circumstances of this case, as Comcare would have it? The approach of Gyles J is not only plausible, but preferable. It gives effect to the terms of s 24, and produces a separate assessment in respect of each injury. 16 (2005) 148 FCR 232 at 252. 17 (2005) 148 FCR 232 at 253. Gummow ACJ Kirby Callinan Crennan Even if there was a relevant conflict in these circumstances, the approach by the Full Court majority to resolving that supposed conflict reversed the hierarchy of the provisions of the Act18. It is true that the Guide seeks to provide for the assessment of "the degree of permanent impairment of the employee" on a whole of person basis. But, as indicated earlier in these reasons, s 24(5) of the Act imposes a duty upon Comcare to determine "the degree of permanent impairment of the employee resulting from an injury". It is the occurrence of "an injury" which both actuates and defines the ambit of Comcare's duty pursuant to s 24 of the Act. Once that duty has been performed, sub-ss (3) and (4) of s 24 operate, in a self-executing way, to quantify the amount of compensation payable by Comcare. That amount is payable in satisfaction of Comcare's liability which arises "in respect of the injury" under s 24(1). The Act only adopts the "whole person impairment" approach with respect to permanent impairments resulting from each "injury". That "whole person" approach cannot properly be used to deny the applicability of s 24 to something which corresponds to the legislative definition of an "injury". The statutory criterion of an "injury" is antecedent to the concept of "whole person" impairment, not the other way around. Comcare's preferred construction of the Act also distorts the statutory definition of "injury" in a further way. The task of determining for the purposes of s 25(4) whether there has been "a subsequent increase in the degree of impairment" necessitates reference to the Guide, by reason of s 24(5). But, it is to be recalled, the inquiry mandated by that sub-section is as to the degree of permanent impairment of the employee "resulting from an injury". To treat as going to that inquiry something which independently satisfies the statutory definition of "an injury" tends to conflate into one all injuries suffered after one workplace incident. The flow-on effect in terms of s 24 thereby distorts the concept of "injury" so as to assume the sense of the totality of the effects of a workplace accident, contrary to the terms of the definition. It should be added, for completeness, that the policy of the Act, discerned by the majority in the Full Court, of restricting liability to pay compensation, does not assist Comcare. The Act does impose limits upon Comcare's liability to pay compensation. Section 24(4) provides that lump sum compensation must be a percentage, and not exceed the "maximum amount", of $80,000 and sub-ss (7) and (7A) of s 24 deny compensation unless the degree of permanent impairment 18 cf Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 Gummow ACJ Kirby Callinan Crennan exceeds a specified threshold percentage. However, this policy does not dictate that something which falls within the definition of "an injury" in respect of which Comcare's liability arises, ought to be excluded from the definition. Nor is it of any relevance to the proper construction of the Act that, as Comcare pointed out, the approach for which the appellant contends operates to his advantage but may operate to the disadvantage of other claimants in other circumstances. These conclusions mean that it is unnecessary to consider the appellant's alternative argument. This was that, if the psychological injury were to be treated as an "impairment" which attracted the operation of s 25(4), then there had been no "final assessment" for the purposes of that section. Further written submissions were received from both Comcare and the appellant on this point, but it need not be pursued. Conclusion and orders For the foregoing reasons, the appeal should be allowed with costs. In his Notice of Appeal, the appellant seeks orders effectively substituting the decision the AAT ought to have made. It is said that it would be futile to remit the matter to the AAT where all the parties accept that the adjustment disorder was "an injury" and there is a finding by the AAT with reference to the Guide that that injury resulted in a degree of permanent impairment of 10 per cent. Comcare emphasised that there had been no appeal or cross-appeal by the present appellant to the Full Court against the orders made by Hill J. However, had the AAT directed itself to the question of whether the adjustment disorder was an "injury" for the purposes of the Act, as Hill J found it ought to have done, there was only one order it properly could have made, given the assessment of the impairment proceeding from the adjustment disorder. That was the view of Gyles J in the Full Court19, and it should now be accepted. The following orders should be made: (1) Appeal allowed with costs. Set aside the orders of the Full Court of the Federal Court of Australia made on 16 December 2005, and in their place order that: 19 (2005) 148 FCR 232 at 254. Gummow ACJ Kirby Callinan Crennan (a) Order 1 made by Hill J on 1 April 2005 be varied so that it reads: The decision of the Administrative Appeals Tribunal dated 21 June 2004 be set aside and in place thereof direct that Comcare determine an amount payable to the Applicant assessed under ss 24 and 27 of the Safety, Rehabilitation and Compensation Act 1988 (Cth) in respect of an injury, being an adjustment disorder with anxious and depressed mood resulting in a degree of permanent impairment of the Applicant of 10 per cent as assessed pursuant to Table 5.1 of the Guide." (b) Appeal otherwise dismissed with costs.

HIGH COURT OF AUSTRALIA APPELLANT AND RAMSEY BUTCHERING SERVICES PTY LTD RESPONDENT Blackadder v Ramsey Butchering Services Pty Ltd [2005] HCA 22 27 April 2005 ORDER Appeal allowed; Set aside the orders of the Full Court of the Federal Court of Australia dated 21 February 2003 and, in their place, order that: a. the appeal be allowed in part; b. order 3 of the orders of Madgwick J in the Federal Court of Australia dated 21 May 2002 be varied by deleting therefrom the words "and for a period of 14 days thereafter"; c. order 4 of those orders be set aside; and d. otherwise the appeal be dismissed. On appeal from the Federal Court of Australia Representation: S C Rothman SC with C T Magee for the appellant (instructed by G J Hatcher SC with B K B Cross for the respondent (instructed by Hannigans Solicitors) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Blackadder v Ramsey Butchering Services Pty Ltd Industrial law – Reinstatement – Employer ordered to reinstate dismissed employee to the position in which he was employed prior to being dismissed – Employer reinstated employee subject to conditions – Employee paid wage but not provided with work – Whether reinstatement order made under s 170CH of the Workplace Relations Act 1996 (Cth) requires employer to provide employee with work – Whether employee was reinstated to the position in which he was employed prior to being dismissed. Federal Court – Jurisdiction – Power – Whether Federal Court may make an order for enforcement of reinstatement order. Words and phrases – "position", "reappoint", "reinstate". Workplace Relations Act 1996 (Cth), ss 178, 170CH, 170JC(3). McHUGH J. The point of principle involved in this appeal is whether an employer reinstates its employee "to the position in which the employee was the meaning of employed s 170CH(3) of the Workplace Relations Act 1996 (Cth) when it: termination" within immediately before the gives the employee the title of his former position; pays the employee the amount earned for ordinary time by persons in that position together with the average of the tally or bonus payments paid to employees in that position; but refuses to provide the employee with any duties until he undergoes a medical examination and satisfies the employer that he has the physical capacity to carry out his pre-termination duties. The point of principle arises out of proceedings, brought in the Federal Court under that section, to enforce an order made by the Australian Industrial Relations Commission. In proceedings in the Commission, Commissioner Redmond had ordered: The [employee] shall be reinstated to the position in which he was employed prior to the termination of his employment without loss of continuity of service or entitlements within 21 days from the date of this decision. The [employee] is to be reimbursed for all lost salary and entitlements from the date of termination to reinstatement less the salary through alternative the parties agree employment." [employee] received the In purported compliance with this order, the employer wrote to the employee on 3 May 2000 stating: Effective on and from 20 April, 2000 you have been reinstated in the position of Boner in the employ of Ramsey Butchering Services Pty Ltd. Until further notice you will not be required to report for work or otherwise perform work in order to be entitled to your wages and other remuneration. You will be required to undergo a medical assessment by a Company nominated medical practitioner prior to resuming any physical work. Our reason for instituting this requirement is more fully explained below. McHugh In terms of the payment of wages from 20 April, 2000 you will receive a payment representing back pay on the next usual pay day and will receive payment weekly thereafter. The payments made to you will be your weekly wage as a Boner in terms of ordinary pay plus the average of the tally paid to all other Boners in any given week. In addition, your superannuation will be paid as normal. The position will continue until the results of the medical assessment is known and considered by the Company at which time you will be advised of the Company's position. Our reason for excusing you from physical work until further notice is that arising from the proceedings before the Commission, and the tendering of the Medical Certificate from Dr Bacon, doubts exist as to your physical capacity to perform the duties of a boner not only in relation to the duties associated with Hot Necking on the Slaughterhouse Floor but more importantly your ability to bone in the Boning Rooms given the Osteoarthritis in your right elbow. As you are aware, an absolute duty is imposed upon the Company as to your health, safety and welfare at work. Until such time as we are able to ascertain your physical condition to bone we do not wish to expose you to any risk. Prior to your recommencing duties we require you to attend for medical assessment by our nominated doctor. We will advise you by letter of the date and time of the appointment. This appointment will be scheduled during normal working hours." After sending this letter, the employer directed the employee to undergo a medical examination on 5 May 2000. But the employee refused to attend the examination on the ground that the Commission's order for reinstatement was not dependent upon fulfilling such a condition. The employee claimed that he was ready and able to resume the boning work that he had performed before termination of his employment. As from 11 June, the employer refused to pay the employee wages because he had failed to submit to the medical examination. On 26 June 2000, the Full Bench of the Commission dismissed the employer's application for leave to appeal against the order of Commissioner Redmond. On 14 July 2000, the employee commenced proceedings in the Federal Court of Australia to enforce the order made by Commissioner Redmond. Twelve days later, the employee informed the employer that he was willing to attend a medical examination arranged by the employer. The employer responded by informing the employee he would be paid an amount equal to the amount earned by boners in the boning team – ordinary time together with the average of the tally earned by boners in the boning team calculated on a piece work basis. However, the employer refused to provide the employee with work until the employee was declared medically fit to do it. McHugh After an aborted medical examination and non-payment of wages for a period, the employee eventually underwent a medical examination on 5 April 2001. From that time, the employee received wages and a share of the tally. However, the employer continued to refuse to allow the employee to return to work. Commissioner Redmond's order was made under the power conferred by s 170CH of the Act. That section provides that, if the termination of an employee's employment "was harsh, unjust or unreasonable", the Commission may make certain orders. Two of them are contained in s 170CH(3) which provides: If the Commission considers it appropriate, the Commission may make an order requiring the employer to reinstate the employee by: reappointing the employee to the position in which the employee was the termination. immediately before employed appointing the employee to another position on terms and conditions no less favourable than those on which the employee was the termination." immediately before employed Before making his order, Commissioner Redmond made certain findings which indicate that his order was intended to reinstate the employee to do hindquarter boning work, the work that the employee ordinarily did before his employment was terminated. Hindquarter boning work is performed on pre-chilled pieces of beef carcasses. When the employee arrived for work on 28 September 1999, however, the employer directed him to leave the boning room where that class of work was done and go to the slaughterhouse floor to perform hot neck boning. That form of boning requires the worker to free the meat from the bones of the carcass from the neck to the ribs. The employee testified – and his evidence was not contradicted – that hot neck boning required greater rotational force and effort of both the wrist and the elbow than general boning work. This was the first time the employer had directed the employee to do hot neck boning. The employee refused to do it because he had no prior experience of, or training for, the work and was concerned that doing it would aggravate a pre-existing injury. Commissioner Redmond accepted the employee's evidence as to the events concerning the termination of his employment. He also found: the employee had a pre-existing medical condition; McHugh the condition prevented the employee from doing hot neck boning; the employee had not been appropriately trained to perform that work; the operational requirements of the employer's business did not require the employee to do the work; and the employer's direction was unreasonable and unsafe and directly resulted in the termination of the employment. Orders are made under s 170CH only if the termination of employment "was harsh, unjust or unreasonable". Whether a termination falls within any of those categories can only be determined by examining what the employee did as part of his employment and the reasons or lack of reasons for terminating the employment. Once the Commission determines that the employment was terminated in circumstances that attract the reinstatement power, it is empowered to rectify the wrong perpetrated by the employer. Paragraph (a) of s 170CH(3) empowers the Commission to order that the employee be re-appointed to the position in which the employee was employed immediately before the termination, that is to say, to do the work on which the employee was engaged when the employment was terminated. If that cannot be achieved, par (b) of the sub-section empowers the Commission to order that the employee be appointed to another position on terms and conditions no less favourable than those on which the employee was employed immediately before the termination. The term "another position" demonstrates that orders made under sub-s (3) are concerned with more than reinstating the contract of employment and its terms and conditions. Whether the terms and conditions are "no less favourable" can be determined only by examining what the employee is employed to do in the new position. Paragraph (b) points irresistibly to the term "position" in s 170CH(3) being concerned with the duties and working conditions of the occupation as well as the contractual rights and duties attached to it. To construe the power "to reinstate" as confined to restoring contractual or other legal rights fails to give full effect to the term "reinstate". To reinstate means to put back in place. In this context, it means that the employment situation, as it existed immediately before the termination, must be restored. It requires restoration of the terms and conditions of the employment in the broadest sense of those terms. It empowers the Commission to do more than restore the contract of employment. So far as practicable, the employee is to be given back his "job" at the same place and with the same duties, remuneration and working conditions as existed before the termination. The Full Court of the Federal Court erred in the present case by holding that "the emphasis on McHugh appointing the employee to a 'position' demonstrates that it is the contractual position which is either to be restored in its earlier terms or in equivalent terms."1 Accordingly, the Commission may make orders under s 170CH(3) for the purpose of reinstating the situation that existed immediately before the employer terminated the employment or, where that cannot be achieved, by putting the employee in a close substitute for that situation. The Order of the Commissioner in the present case must be read against the circumstances of the pre-termination employment and the finding that the employee was not fit to do hot neck boning. When that is done, the direction to reinstate the employee "to the position in which he was employed prior to the termination of his employment" can only mean that the employee had to be given back the job that he had before termination, performing the same duties on the same terms and conditions. He was to be reinstated to do the general boning work and, in particular, the hindquarter boning work that he did before the termination. His reinstatement was not subject to any condition that he was fit to perform his pre-termination duties. An employer cannot evade the operation of a reinstatement order by making it subject to the employer's satisfaction concerning the fitness of the employee or some other condition formulated by the employer. The employer's failure to provide work for the employee was a breach of the order of the Commission, as Madgwick J, the primary judge, found. Order The appeal must be allowed. I agree in the orders proposed by Callinan 1 Ramsey Butchering Services Pty Ltd v Blackadder (2003) 127 FCR 381 at 416 Kirby KIRBY J. I agree with the other members of this Court that the majority in the Full Court of the Federal Court of Australia, from whose orders this appeal comes2, erred in the view that they took of the employment reinstatement provisions of the Workplace Relations Act 1996 (Cth)3 ("the Act"). The approach of the dissenting judge in the Full Court (Moore J) is to be preferred4. The facts surrounding the appellant's termination The facts, described by Callinan and Heydon JJ in their reasons ("the joint reasons")5, concerning the case between Mr Stephen Blackadder (the appellant) and his employer, Ramsey Butchering Services Pty Ltd (the respondent), reveal a fairly typical instance of breakdown of trust in the employment relationship. This is apparent, to take but one example, in the appellant's refusal (ultimately withdrawn) to undergo a medical examination by a medical practitioner nominated by the respondent except in the presence of his wife – a requirement to which the practitioner would not accede6. However, this attitude on the part of the appellant, and indeed the course of the conflict between the parties, must also be considered against the background of the events that preceded this litigation. That background is described in the reasons for decision7 of a Commissioner of the Australian Industrial Relations Commission ("the Commission"), Redmond C, in resolving the appellant's application to the Commission for relief under the Act8. Those reasons were part of the record. They were referred to both by the primary judge (Madgwick J) in the Federal Court9, and, on appeal, by the Full Court10. 2 Ramsey Butchering Services Pty Ltd v Blackadder (2003) 127 FCR 381. 3 Especially s 170CH. See reasons of Callinan and Heydon JJ ("joint reasons") at 4 Ramsey (2003) 127 FCR 381 at 406-410 [44]-[54]. Joint reasons at [49]-[64]. Joint reasons at [62]. 7 Blackadder v Ramsey Butchering Services Pty Ltd, 29 March 2000 (Redmond C), Prints S4537 and S4542 ("Decision of the Commissioner"). s 170CE. 9 Blackadder v Ramsey Butchering Services Pty Ltd (2002) 118 FCR 395 at 399-401 10 Ramsey (2003) 127 FCR 381 at 386 [3], 390-391 [7] per Moore J. Kirby In late August 1999, the appellant was given a summons by the respondent to appear as a witness in a case between another employee and the respondent. The case was being heard before the Commission at the Grafton courthouse. The case concerned an allegedly unlawful termination of the employment of the other employee. After giving his evidence on Monday 27 the September 1999, respondent's solicitor that the evidence given by him ... was not helpful to the respondent and conflicted with the company's submissions in a number of key respects"11. Under the Act, as the Commissioner noted, dismissal or discrimination against an employee for giving evidence in a proceeding under industrial law is prohibited12. the appellant "concluded from the comments of As the Commissioner observed, "[t]he respondent's directions to the [appellant] on Tuesday 28 September 1999 came immediately after he gave evidence in proceedings unfavourable for the respondent's case"13. The respondent's direction to the appellant to proceed from the boning room (where he had previously worked on chilled boning) to the slaughterfloor (to carry out "hot necking") happened at 6.30am on 28 September 1999, immediately after the appellant presented for duty. The appellant had been working as a boner in the boning room since 29 April 1998. He objected to the change to duties outside his skills and, possibly, his capacity. Presumably, he considered that the change in his duties was more than coincidental. The Commissioner found that the respondent's termination of the appellant's employment, which immediately followed these events, was unfair and unlawful14. He accepted the appellant's evidence "without reservation"15. He did not accept the evidence of Mr Ramsey, the Managing Director of the respondent, whom he described as "aggressive, evasive and forgetful". He characterised Mr Ramsey's aggression as "as startling as it was inappropriate"16. He concluded that "whenever the truth and Mr Ramsey's business interests conflict, truth would not be the winner"17. 11 Decision of the Commissioner at [9]. 12 The Act, ss 298L(j), 298L(k). 13 Decision of the Commissioner at [10]. 14 Decision of the Commissioner at [17]; see also at [71]. 15 Decision of the Commissioner at [62]. 16 Decision of the Commissioner at [61]. 17 Decision of the Commissioner at [62]. Kirby Having held that the termination of the appellant's employment was unreasonable because of the directions given to him, Redmond C concluded that a breach of the applicable Australian Workplace Agreement ("the AWA")18 had occurred. He decided that the appropriate remedy was reinstatement of the appellant in the employment of the respondent. In so ordering, the Commissioner took into account his finding that the appellant was "innocent of any matters of conduct or performance which would mitigate against reinstatement"; that the appellant had mitigated his losses as best he could; and that he would have "grave difficulty" in finding alternative employment in Grafton19. It was against this order of reinstatement that the Full Bench of the Commission refused the respondent leave to appeal20. The proceedings, so concluded in the Commission, then became the basis of the application for the imposition of penalties and making of declarations by the Federal Court, pursuant to the Act21. Amongst other things, the appellant complained that the respondent had refused to reinstate him in "his work as a boner". Having made the orders of reinstatement, Redmond C did not proceed to "decide whether the [appellant] was being victimised for having given evidence"22. However, the background to the dispute was not forgotten, being mentioned successively by Redmond C23, the Full Bench of the Commission24 and by Madgwick J in the Federal Court25. I have referred to the background not because it is legally determinative but because it demonstrates how the case is a fairly typical one, involving stress in the employment relationship on both sides, with strong feelings and a sense of grievance in both parties. 18 Ramsey Butchery Services Pty Ltd (Grafton Meatworks) Australian Workplace Agreement 1998. See joint reasons at [49]-[52]. 19 Decision of the Commissioner at [72]-[73]. 20 Blackadder v Ramsey Butchering Services Pty Ltd, 26 June 2000 (Boulton and Munro JJ, Harrison C), Print S7395 ("Decision of the Full Bench"). 21 The Act, ss 170CE, 170CH, 170JC. 22 Blackadder (2002) 118 FCR 395 at 399 [14] per Madgwick J. 23 Decision of the Commissioner at [8]-[13]. 24 Decision of the Full Bench at [3]. 25 (2002) 118 FCR 395 at 397-398 [5]-[12]. Kirby The purpose and operation of reinstatement orders The fact that, for a very long time26, Australian statute law has provided for orders of reinstatement in circumstances such as those in this case27 illustrates the exceptional but settled character of such orders – intruding as they do into the personal relationship of employer and employee28. Such intrusion is deliberate and envisaged by the Act29. The constitutional validity of the provisions of the Act was not questioned in this appeal30. The purpose of the Parliament in providing for such relief is to be given effect by the Commission and the courts. It is not to be frustrated or negatived because it conflicts with common law notions of freedom of contract or with other traditional legal rules respecting the personal character of the employment contract. All such rules must adapt to the statutory provisions which have been enacted for important social and industrial purposes. The chief purpose for the relevant power finds its source in notions of industrial equity having a long history in Australian labour law. Specifically, in relation to a consideration of an application in respect of a termination of 26 The first recorded reinstatement order in Australia was made by the Industrial Commission of New South Wales in Newcastle Wharf Labourers' Union v Newcastle & Hunter River Steamship Co Ltd [1902] AR (NSW) 1. See Ramsey (2003) 127 FCR 381 at 406 [44] per Moore J. 27 See, for example, O'Donovan, "Reinstatement of Dismissed Employees by the Australian Conciliation and Arbitration Commission: Jurisdiction and Practice", (1976) 50 Australian Law Journal 636; Davidson, "Reinstatement of Employees by State Industrial Tribunals", (1980) 54 Australian Law Journal 706. 28 Byrne v Australian Airlines Ltd (1995) 185 CLR 410. 29 The Act, s 170CH. The power to order reinstatement has been described as "drastic": Slonim v Fellows (1984) 154 CLR 505 at 515. 30 See Re Ranger Uranium Mines Pty Ltd; Ex parte Federated Miscellaneous Workers' Union of Australia (1987) 163 CLR 656; Re Federated Storemen and Packers Union of Australia; Ex parte Wooldumpers (Vic) Ltd (1989) 166 CLR 311. Part VIA Div 3 of the Act now draws for its validity, additionally, on the external affairs power in the Constitution, s 51(xxix), in fulfilment of ILO Convention (No 158) concerning Termination of Employment at the Initiative of the Employer done at Geneva on 22 June 1982, [1994] Australian Treaty Series No 4; and on the corporations power (the Constitution, s 51(xx)). See the Act, ss 170CA(1)(e), Kirby employment, the command of the Parliament is that the statutory procedures and remedies provided in the Act (including for orders of reinstatement) are to be exercised to accord both employer and employee a "fair go all round"31. The width of the power to order reinstatement, conferred on the Commission by the Act, is indicated by the language of sub-s 170CH(3). There, the Commission is empowered to make an order requiring the employer to reinstate the employee by reappointing the employee "to the position in which the employee was employed immediately before the termination"32, or "to another position on terms and conditions no less favourable than those on which the employee was employed immediately before the termination"33. It is impossible to reconcile these very wide provisions, and in particular sub-par (b), with the narrow view of the Commission's jurisdiction and power adopted by the majority in the Full Court in this case34. As the joint reasons demonstrate35, the provision to the appellant of an average boner's salary in lieu of actual employment duties is not, in this case, a compliance with the order for reinstatement made under the Act. First, it does not permit the appellant to increase his income, which, under the AWA, could be increased incrementally, based on the quantity of boning work performed by the particular employee. Secondly, it denies him the satisfaction of employment, the feeling of self-worth that it can generate and the maintenance of his skills to which their exercise would contribute36. Thirdly, it denies the appellant the vindication of actual "reinstatement", which is one of the social and industrial purposes of the order made under the Act, confirmed by the Full Bench of the Commission and given effect by Madgwick J in the Federal Court. By the Act, and the order, reinstatement of the appellant was meant to be real and practical, not illusory and theoretical. In effect, if the respondent's argument were correct, it would permit the respondent to thumb its nose at the 31 The Act, s 170CA(2). The note to this sub-section refers to the use of that expression by Sheldon J in Re Loty and Holloway v Australian Workers' Union [1971] AR (NSW) 95, also a reinstatement case. 32 s 170CH(3)(a). 33 s 170CH(3)(b). 34 Ramsey (2003) 127 FCR 381 at 416 [77]. 35 Joint reasons at [75]-[77]. 36 William Hill Organisation Ltd v Tucker [1999] ICR 291 at 295-296, citing Provident Financial Group Plc v Hayward [1989] ICR 160. Kirby heart and core of the order made, namely that the appellant be "reinstated", that is, according to the word's derivation and ordinary meaning, "put back in place" in his former employment. The Act does not grant the employer the unilateral power to buy its way out of the obligations imposed on it under a valid law of the Parliament. The employer is bound to comply with the order and the Act. Its failure to do so produces statutory consequences to which, by his orders, Madgwick J sought to give effect.37 Form of the orders to be made I agree with Callinan and Heydon JJ38 that Moore J in the Full Court of the Federal Court gave the correct analysis of what might happen in the future if the appellant were unable, or unwilling, to perform the work of his former position as a boner in the chilled boning room (or such other work as was later assigned to him)39. The purpose of a reinstatement order is to ensure that the employee in question is placed in the status quo ante40. It is not to anticipate every eventuality that might thereafter arise; nor is it to provide the employee the subject of it with employment for life. What happens in the future, and what follows from what happens, depends on all the circumstances then obtaining. The logic of this analysis requires that this Court should, in substance, restore the orders of Madgwick J and not attempt for itself to draft orders of its own to anticipate unknowable future events. In an appeal, although this Court has the power to make the order that should have been made in the court below41, it remains a court of error. In this appeal from the orders favoured by the majority of the Full Court of the Federal Court, having found error, this Court should set those orders aside and restore the orders of the primary judge, subject to the deletion and variation proposed by Moore J in the Full Court42. We should leave future events to be handled in the correct places, namely by restoration of the matter (or initiation of a new matter) before the Commission or, if any facility for variation of orders remains open, before the Full Court. 37 The Act, s 170JC(3). 38 Joint reasons at [77]. 39 Ramsey (2003) 127 FCR 381 at 396-397 [20], 402-404 [34]-[38]. 40 Ramsey (2003) 127 FCR 381 at 397 [21]. See joint reasons at [75], [77]; cf Re Loty [1971] AR (NSW) 95 at 106. 41 Judiciary Act 1903 (Cth), s 37. 42 Ramsey (2003) 127 FCR 381 at 406 [43]. Kirby Orders I agree in the orders proposed in the joint reasons. Hayne HAYNE J. The facts and circumstances giving rise to this appeal are described in the reasons of Callinan and Heydon JJ. I do not repeat them except to the extent necessary to explain my reasons. The principal statutory provisions in issue are set out there and again I need not repeat them. The Australian Industrial Relations Commission ("the Commission") made orders43 under s 170CH of the Workplace Relations Act 1996 (Cth) ("the Act") that the appellant be reinstated to the position in which he was employed prior to the termination of his employment by the respondent and that he be reimbursed the difference between the salary and entitlements he would have earned with the respondent and the amount he received from alternative employment. The Commission having made this order, the respondent told the appellant that until further notice he would not be required to report for work, or otherwise perform work, in order to be entitled to his wages and other remuneration. The respondent also sought leave to appeal to a Full Bench of the Commission against the orders made at first instance. The respondent's application to the Full Bench of the Commission failed44. The appellant then applied to the Federal Court, pursuant to s 178 of the Act, for orders imposing penalties on the respondent for failing to comply with the Commission's orders and, pursuant to s 170JC(3), for injunctions enforcing the Commission's orders, and for an order that he recover lost wages. On 10 May 2002, the primary judge (Madgwick J) declared45 that the respondent had breached the order of the Commission, and that its conduct in certain other respects (not now relevant) had contravened the applicable Australian Workplace Agreement46. The primary judge imposed penalties for these contraventions47. By the same order, the primary judge made orders for payment of wages and entitlements, together with interest, and directed the parties to bring in short minutes of orders quantifying the amount of interest to be paid and "providing for injunctive relief to be ordered, if still sought" in the light of the reasons for decision. Subsequently, on 21 May 2002, the primary judge made further orders, 43 Blackadder v Ramsey Butchering Services Pty Ltd, 29 March 2000 (Commissioner Redmond), Prints S4537 and S4542. 44 Blackadder v Ramsey Butchering Services Pty Ltd, 26 June 2000 (Boulton and Munro JJ, Commissioner Harrison), Print S7395. 45 Blackadder v Ramsey Butchering Services Pty Ltd (2002) 118 FCR 395. 46 s 170VT. 47 ss 170VV, 178. Hayne including an order that the respondent reinstate the appellant to the position in which he was employed prior to the termination of his employment "namely a boner performing chilled boning work in that part of the respondent's premises known as the big boning room". The respondent appealed to the Full Court of the Federal Court against the orders made on 10 May 2002 and the orders made on 21 May 2002. The Full Court allowed48 the respondent's appeal in part. The Full Court ordered that the primary judge's orders of 21 May 2002 (the second orders made by the primary judge) be varied by deleting the words "namely a boner performing chilled boning work in that part of the respondent's premises known as the big boning room" and by setting aside some consequential orders the primary judge had made on 21 May 2002. The Full Court's orders did not, however, interfere with the primary judge's earlier orders of 10 May 2002, declaring the respondent to have breached the Commission's orders for reinstatement (and the Australian Workplace Agreement) and imposing penalties for those contraventions. The Full Court's reasons did not examine how the findings of breach, and consequent imposition of penalties, could stand with the decision to vary the primary judge's orders by deleting that part which identified the position to which the appellant was to be reinstated. The central issue in this appeal is one of statutory construction. What is meant in s 170CH(3)(a) by "an order requiring the employer to reinstate the employee by ... reappointing the employee to the position in which the employee was employed immediately before the termination". In particular, what is meant in that provision by "position"? "Position", when used in s 170CH(3)(a), refers to the place in the employer's commercial structure which the employee occupied before termination. It refers not only to the pay and other benefits which an employee may earn in a position, but also to the work which the person filling that position does. It follows that an employer, ordered to reinstate an employee by reappointing the employee to the position in which the employee was employed immediately before the termination, not only must recommence paying or providing the financial or other benefits attached to the position, but also must put the employee back to the performance of those duties which the employee was fulfilling before termination. There are two principal reasons to reach this conclusion. First, s 170CH(3) provides for two different kinds of order for reinstatement. It distinguishes between, on the one hand, orders requiring an employer to reinstate an employee by reappointing the employee to the position in which the employee 48 Ramsey Butchering Services Pty Ltd v Blackadder (2003) 127 FCR 381. Hayne was employed immediately before termination, and, on the other, reinstatement by appointing the employee "to another position on terms and conditions no less favourable than those on which the employee was employed immediately before the termination". This distinction between reinstatement by reappointing to the former position and reinstatement by appointing to another position reveals that the concept of "position" is insufficiently described by reference only to the pay or other benefits which an employee is to receive from the employer. Yet in essence the respondent's contention was that the appellant was reinstated to his former position because he was paid the same pay and benefits, and that it did not matter whether he was given any work to do. Secondly, both the drawing of that distinction and the Act's reference to "position" rather than "employment" or "contract of employment" reveal that more is required by an order of the kind now in question than recreation of the contractual nexus that existed between the parties before the termination of employment or recreation of that nexus to the extent of giving the employee the benefits available under the terms and conditions which previously existed. Rather, reinstatement by reappointing to a former position requires the recreation of the circumstances of employment that preceded the termination. The contractual nexus between the parties must be re-established. The terms and conditions of that contract must be the same. The employer must provide work to be done by the employee of the same kind and volume as was being done before termination. In cases where that last element cannot be achieved (as, for example, where the work formerly done is no longer required) the form of reinstatement for which s 170CH(3)(a) provides would not be appropriate and the question would become whether the alternative form of reinstatement (by appointing to another position) should be made. In the circumstances described in the reasons for judgment of Callinan and Heydon JJ, the primary judge was right to conclude that the respondent had not obeyed the Commission's order. (The order which the Commission made did not follow precisely the words of s 170CH(3)(a), but there is no reason to doubt that the order was intended to effect that kind of reinstatement.) The respondent had not reinstated the appellant by reappointing him to his former position. The primary judge was therefore right to hold that the respondent was in breach of the Commission's orders and, in consequence, in breach of the Act. It was not submitted that the primary judge should not have gone beyond finding contravention and imposing penalties to make orders, under s 170JC(3), in the form of mandatory injunctions requiring reinstatement. Because the respondent did not reinstate the appellant in accordance with the Commission's order, it is unnecessary to consider whether, or in what circumstances, it would be open to an employer who had re-engaged an employee, then, by resorting to some provision of the applicable industrial instrument, to seek to transfer that employee to other duties. Such a case may present difficult questions of fact and degree about whether what was done contravened the order for reinstatement. Such difficulties suggest that the cases in which it may be appropriate to make mandatory orders regulating the future conduct of relations between an employer Hayne and employee (as the primary judge did here by directing the respondent to furnish the appellant with his usual work for a period of 14 days) may be rare. There being no challenge to this particular aspect of the primary judge's order, it is unnecessary to consider it further. The appeal to this Court should be allowed, the orders of the Full Court of the Federal Court of Australia made on 21 February 2003 set aside and, in their place, there be orders that the appeal to that Court be dismissed. CALLINAN AND HEYDON JJ. The substantial issue in this appeal is whether an order for reinstatement of an employee made by the Australian Industrial Relations Commission under the Workplace Relations Act 1996 (Cth) ("the Act") required the employer to provide actual work to the reinstated employee. Facts The appellant had been a rugby footballer and a rider in rodeos in his youth. For some years before its closure in 1997, he worked as a boner at an abattoir in Grafton in New South Wales. In 1998, the abattoir reopened under the different ownership of the respondent. The respondent wished to introduce more flexible working arrangements49 at the abattoir on its reopening, and to provide incentives to employees to cooperate in these arrangements in order to increase productivity. That this is so appears from the terms of the Ramsey Butchery Services Pty Ltd (Grafton Meatworks) Australian Workplace Agreement ("the AWA") which was registered by the Australian Industrial Relations Commission ("the Commission") on 23 October 1998 pursuant to Div 5 of Pt VID of the Act which the appellant signed, and by which the parties were bound, and the undertaking that he gave to the respondent: To work 5 days a week when required without the imposition of any bans or limitations and without stoppages. To work in accordance with the lawful requirements of the Company. To work in accordance with Company directions. The appellant also agreed that "[his] continued employment may be contingent upon satisfactorily passing a physical examination at any time to establish [his] capability to properly or safely perform [his] duties." The appellant said that he had not suffered any disabilities of his wrist, elbow or shoulder but disclosed that he had previously dislocated his right elbow. Before his engagement, the appellant was examined by a doctor who declared him fit for heavy manual work subject to this slight qualification: 49 Ramsey Butchery Services Pty Ltd (Grafton Meatworks) Australian Workplace Agreement 1998, cll 22.1, 35 and 37.20. "Slight (20%) limitation of (R) shoulder rotation because of old (R) elbow dislocation – fibrosis here. Shoulder would be classified as normal." It is necessary to refer to the relevant terms of the AWA. Clause 1 is concerned with hours of work, cl 2 with rates of pay for various categories of employees, and cl 7 with overtime. Clause 9 specifies the tasks to be performed by slaughterpersons. Clause 17 makes provision for flexibility of working times in case of shortage of stock, temporary interruption of employment and the financial consequences of these. Sub-clauses 22.1, 22.3 and 22.4 provide a further indication that the working arrangements may be altered from time to time: "22.1 Any employee, including a juvenile, called upon to perform work of any classification for which a higher rate of pay is provided by this AWA, shall be paid the higher rate of pay whilst so employed with a minimum of three hours at such rate of pay. 22.3 Any employee who is required to perform on any day or shift, work for which a lower rate than that of his ordinary classification is prescribed, shall suffer no reduction in consequence thereof. 22.4 Where any employee is transferred for the greater part of the day under the provisions of this clause, he/she shall be entitled to the conditions normally associated with the particular position he/she was transferred to." Sub-clauses 35.1, 35.8 and 35.9 deal with categories of work and the duty of employees to work as directed: "35.1 An employee shall be engaged either as a weekly hand or as a daily hand or as a part-time employee and each employee shall be notified at the beginning of employment and before commencing work whether the employee is a weekly or daily hand or part-time employee. 35.8 A labourer shall be required to perform slaughtering tasks and shall be required to contribute to tally provided the said labourer is suitably qualified to perform the slaughtering task or tasks required and is paid the appropriate slaughtermen's rate of pay for such time as the labourer is performing that slaughtering task or tasks. 35.9 An employer may direct an employee to carry out such duties as are within the limits of an employee's skill, competence and training: the employee will follow such direction." Clause 37 is concerned with "tally boning". It is plain from its terms which need not be set out that the productivity of a team of workers of which the appellant would have been a member, may affect the remuneration of the team, each of whom could, by his personal efforts, influence both of these; sub-cll 37.2 and 37.10 are of some further significance however because they indicate that "neck boning" was to be treated separately and differently from other work under the AWA. Sub-clause 37.20, which has of course to be read with, and subject to the other parts of the AWA, in particular sub-cl 35.9 above, is as follows: "37.20 Employees shall perform such tasks or combination of tasks as the employer may require." The primary judge, Madgwick J, described the appellant's employment and its termination as follows50: "Until the events constituting termination of his employment, the [appellant] worked in what was referred to as the big boning room at the Grafton meatworks and principally performed hindquarter boning work. That work is performed on pre-chilled pieces of beef carcases. On 28 September 1999 the [appellant] arrived at work and was directed to leave that boning room and go to the slaughter floor to perform hot neck boning, a task he had not previously undertaken. This was the first time the respondent had directed him to undertake such work, and he had not been trained in it. Hot neck boning involves 'freeing' the meat from the bones from the neck to the ribs. The [appellant's] unchallenged evidence was that this requires greater rotational force and effort of both the wrist and elbow than general boning. The [appellant] refused to perform the task and left the premises shortly thereafter. The [appellant's] reasons for refusing to undertake the work included that he had no prior experience or training in hot neck boning and that he was concerned about his right arm. As indicated above, the [appellant] has some restriction in his right shoulder due to earlier dislocations of his right elbow, such dislocations pre-dating his employment with the respondent. The [appellant] also believed he was being victimised for giving evidence, adverse to the respondent's interests, to the AIRC on the previous day, 27 September 1999, in respect of another unlawful termination case concerning another employee of the respondent." 50 Blackadder v Ramsey Butchering Services Pty Ltd (2002) 118 FCR 395 at 398 On 25 October 1999 the appellant filed an application for relief pursuant to s 170CE of the Act alleging unlawful termination of his employment by the respondent on or about 5 October 1999. A hearing was conducted before Commissioner Redmond on 18 and 19 January 2000 and 17 February 2000. Commissioner Redmond gave his decision on 29 March 2000. He found that the respondent had terminated the appellant's employment and that the termination was unfair, harsh and unreasonable. the Commissioner said: In his reasons, "The [appellant] was instructed at approximately 6.30 am on 28 September 1999 to perform hot neck boning. The [appellant] said that he had no experience in hot neck boning and thought that it would be a danger to the employees on the slaughterhouse floor if he tried to perform the work. Also, the [appellant] had a disability that restricted movement in one arm. The company knew of the [appellant's] disability. The disability added to his safety concerns. The [appellant] firmly believed that he could do damage to himself and to other employees. He felt he was being victimised by the company. The evidence of Mr Paul David Marshall, the company's personnel officer and payroll manager, concerned the circumstances which arose after the [appellant] had left the workplace and the functions that he assumed employees should carry out according to their classifications. In his sworn statement Mr Marshall referred to other matters he thought relevant to the case. During cross-examination by [counsel for the appellant] it became clear that the [appellant] had been employed by the respondent with a pre-existing elbow injury which was noted in the Doctor's Certificate and which would have caused some restriction when performing hot neck boning. Furthermore the witness expressed his concern regarding training and whether people were being fully trained. In determining the various issues before me it was necessary to make some preliminary findings of fact. I have set out these findings below. • I accept the [appellant's] version of events regarding the circumstances surrounding the termination of his employment without reservation. • I find that the [appellant] had a pre-existing medical condition which was more probably than not one which caused him to be unable to perform work in hot neck boning. • I find that the [appellant] had not been appropriately trained to perform hot neck boning. this work. • I find that there was no identifiable need related to the operational requirements of the business for the [appellant] to be selected to perform the [appellant] was characterised by the respondent as a move required for the continued operation of the respondent's business in order to cover a vacancy. There was no evidence to support this proposition and I reject it." The direction The Commissioner found that the respondent's direction was unreasonable and unsafe and directly resulted in the termination of the appellant's employment. He accordingly made the following orders: The [appellant] shall be reinstated to the position in which he was employed prior to the termination of his employment without loss of continuity of service or entitlements within 21 days from the date of this decision. The [appellant] is to be reimbursed for all lost salary and entitlements from the date of termination to reinstatement less the salary the parties agree the [appellant] received through alternative employment." By letter dated 3 May 2000, the respondent wrote to the appellant to advise him that he had been reinstated effective on and from 20 April 2000. That letter stated: "We refer to the Orders made by Mr Commissioner Redmond on 29 March, 2000. Under Order 1 we were ordered to reinstate you to the position in which you were employed prior to the termination of your employment without loss of continuity or entitlement within 21 days from the date of decision (ie 29 March, 2000). ... For the purpose of compliance with the order your employment status is to be as set below: Effective on and from 20 April, 2000 you have been reinstated in the position of Boner in the employ of Ramsey Butchering Services Pty Ltd. Your employment date will be 30 April, 2000 with full continuity from that date for all purposes. Until further notice you will not be required to report for work or otherwise perform work in order to be entitled to your wages and other remuneration. You will be required to undergo a medical assessment by a Company nominated medical practitioner prior to resuming any physical work. Our reason for instituting this requirement is more fully explained below. In terms of the payment of wages from 20 April, 2000 you will receive a payment representing back pay on the next usual pay day and will receive payment weekly thereafter. The payments made to you will be your weekly wage as a Boner in terms of ordinary pay plus the average of the tally paid to all other Boners in any given week. In addition, your superannuation will be paid as normal. The position will continue until the results of the medical assessment is known and considered by the Company at which time you will be advised of the Company's position. Our reason for excusing you from physical work until further notice is that arising from the proceedings before the Commission, and the tendering of the Medical Certificate from Dr Bacon, doubts exist as to your physical capacity to perform the duties of a boner not only in relation to the duties associated with Hot Necking on the Slaughterhouse Floor but more importantly your ability to bone in the Boning Rooms given the Osteoarthritis in your right elbow. As you are aware, an absolute duty is imposed upon the Company as to your health, safety and welfare at work. Until such time as we are able to ascertain your physical condition to bone we do not wish to expose you to any risk. Prior to your recommencing duties we require you to attend for medical assessment by our nominated doctor. We will advise you by letter of the date and time of the appointment. This appointment will be scheduled during normal working hours." The appellant was subsequently directed to undergo a medical examination by Dr Castagna in Casino on 5 May 2000. The appellant did not attend for the examination, because, he said, inter alia, Commissioner Redmond's order for reinstatement was not conditional upon it and he was ready, willing and able to resume his pre-termination boning work. On 7 June 2000 the respondent advised the appellant that payment of his wages would cease by reason of his failure to submit to a medical examination. The appellant received no wages from the week ending 11 June 2000 to the week ending 23 July 2000. On 26 June 2000 the respondent applied for leave to appeal and the appeal was heard and dismissed by the Full Bench of the Commission (Boulton and Munro JJ and Commissioner Harrison). On 15 September 2000 the appellant commenced a proceeding under s 170JC(3)51 of the Act in the Federal Court of Australia to enforce the order made by the Commission. By letter dated 26 July 2000 the appellant informed the respondent that he was willing to attend any medical examination arranged at the request of the respondent. By letter dated 10 August 2000, the respondent advised the appellant that it would begin to pay the appellant an amount being the amount earned by boners in the boning team for ordinary time, plus the average of the tally paid to all other boners, calculated on a piece work basis from 26 July 2000. The respondent continued however to refuse to provide him with any work until after he received medical clearance. The respondent then arranged a further medical examination on 6 February 2001. Although the appellant attended for the examination it did not take place. The examining doctor refused to proceed whilst the appellant's wife was in attendance and the appellant declined to let her leave. On 16 February 2001, the respondent advised the appellant that payment of his wages would cease and would not recommence until he underwent a medical examination. The appellant received no wages from the week ending In addition to any other right that an employee covered by an order under this Part may have under Part VIII (as it applies in accordance with this section): the employee may apply to the Court to enforce the order by injunction or otherwise as the Court thinks fit; and if the order is an order under Subdivision B of Division 3 – the employee may apply to a court of competent jurisdiction as defined in section 177A to enforce the order by injunction." Section 4 of the Act defined "Court" as the "Federal Court of Australia". 18 February 2001 to the week ending 18 March 2001. He did however inform the respondent on 23 February 2001 that he was willing to undergo a medical examination. On 5 April 2001, the appellant underwent a medical examination. From that date, the respondent commenced to pay the appellant an amount being the amount earned by boners in the boning team for ordinary time, plus the average of the tally paid to all other boners, calculated on a piece work basis, but did not allow the appellant to return to work or to contribute to the piece work tally. Decision of the primary judge The primary judge in the Federal Court (Madgwick J) delivered his reasons for judgment on 10 May 2002. His Honour was of the view that reinstatement under s 170CH of the Act involves a return of the employee to the workplace52: "... I would agree that reinstatement under s 170CH of the Act does implicitly involve a return of the employee to the workplace. The Act contemplates that it is only in circumstances where reinstatement is inappropriate that the suitable alternative is to award payment in lieu of reinstatement (s 170CH(6)). Thus, the apparent statutory purpose of the relief is to treat the dismissal as ineffective and restore the employment situation to its pre-termination status. If a direction to reinstate an employee required no more than that the employee be put back on the payroll, it is difficult to see why reinstatement would even be 'inappropriate'. Further, as Wilcox CJ observed in Perkins v Grace when considering the meaning of 'reinstated' for the purposes of s 170EE, the predecessor of s 170CH, such meaning should be considered in light of its usage Such parlance would understand reinstatement to include reinstatement in the sense just mentioned, including all the usual incidents of the employment, such as attendance at the workplace and there being furnished with one's usual productive work. industrial parlance. In finding that the orders did require that the [appellant] be returned to work, it is important to clarify what the reinstatement order required in a practical and concrete sense. Counsel for the respondent was, in my opinion, correct in saying that reinstatement does not mean that an 52 Blackadder v Ramsey Butchering Services Pty Ltd (2002) 118 FCR 395 at 406-408 employee acquires new legal rights but simply restores the employment relationship with all, but only, the rights and entitlements to treatment in good faith which existed between the parties prior to the termination. It is to be remembered also that such obligations of good faith are owed by both parties. Part of the background matrix of facts in this matter showed a need for reasonable flexibility, recognised in the AWA, for the deployment of employees. What the 'position' was to which the [appellant] was to be reinstated by reappointment (cf s 170CH(3)(a)) is a question of fact and, as a matter of fact, a person may hold a position under which certain work is or is not required, whether or not such position has an express classification or description (such as 'boner'): see State Rail Authority (NSW) v Bauer J53. Commissioner Redmond was plainly of the view that the [appellant's] s 170CH(3)(a) position was that of a boner required to do chilled boning work in the big boning room. Of particular significance are the Commissioner's findings that: the [appellant's] pre-existing medical condition probably caused him to be unable to perform work in hot neck boning; the [appellant] had not been appropriately trained to perform the hot neck boning; and there was no the operational requirements of the business for the [appellant] to be selected to perform this work. identifiable need related Taking these findings into account, the order to reinstate the [appellant] plainly intended that he would not only receive his wages and other entitlements but, in the first instance, at least, return to his former position of employment, namely to a position undertaking boning in the big boning room. The evidence before me indicates that the [appellant] would concede that his position requires that occasionally, for bona fide operational purposes of the employer, he should relieve on the hot neck boning work. As I have indicated, the [appellant's] rights are as before. If he then had a legal liability to be transferred to hot neck boning, upon reinstatement he would again have such liability. If he did not, or did not 53 (1994) 55 IR 263 at 269. until he was trained, then again he would not be so liable. If he had a liability to undergo medical examinations from time to time, on the existence of a reasonable need for them and on reasonable terms, such liability would continue. Finally, whatever mutual rights and liabilities as to transfer, removal from active work or termination of employment pre- existed his termination, they will exist again after reinstatement. Some of these matters may involve difficult questions and their resolution should await full argument, if, as I hope will not be the case, it should become necessary." On 21 May 2002, Madgwick J made the following orders: The respondent reinstate the [appellant] to the position in which he was employed prior to the termination of his employment, namely a boner performing chilled boning work in that part of the respondent's premises known as the big boning room. Upon such reinstatement and for a period of 14 days thereafter the respondent shall furnish the [appellant] with his usual work in such position, excepting in case of shortage of stock to slaughter. In the event of a dispute thereafter as to the [appellant's] physical capacity to perform the work that thereafter might lawfully be required of him, the parties and each of them are to refer the matter to the Disputes Committee established under the [AWA] which, as was common ground in the proceedings, binds the parties. The decision of the Full Court of the Federal Court In its appeal to the Full Court of the Federal Court, the respondent challenged the orders for the reinstatement of the appellant and submitted that an order for reinstatement simply revived the contract of employment. It submitted that as an employee does not have a right or entitlement to do actual work under a contract of employment, an order cannot be made in exercise of a power to order reinstatement, conferring such a right on the employee and imposing a corresponding duty on the employer to provide it. The Full Court upheld the appeal in part on 21 February 2003 (Tamberlin and Goldberg JJ, Moore J dissenting). In doing so the majority reviewed the position at common law by which they were obviously influenced, and found that there is no obligation upon an employer to provide work to an employee unless the contract of employment specifically requires that it be provided, or where it was necessary for an employee, an actor for example, to continue to be employed in order to maintain a profile, or where the employee's career and future prospects depended upon the employee working in a particular way, or where the employee's remuneration depended upon the amount of actual work performed by the employee. Their Honours said54: "We consider the emphasis on appointing the employee to a 'position' demonstrates that it is the contractual position which is either to be restored in its earlier terms or in equivalent terms. By using the terminology of 'appointing' as opposed to 're-employing' for example, there is indicated a legislative intention to re-establish rights or equivalent rights which were destroyed by the wrongful termination. The language does not indicate a legislative intention to provide more than that to which the employee was entitled prior to the wrongful termination. In our opinion, where a person is reinstated by appointment to a position in which he or she was acting at the time of dismissal pursuant to s 170CH(3)(a), then that provision requires that the person should be restored to all the contractual entitlements which applied in respect of that position at the time of the wrongful dismissal so far as possible, but should not be given any additional entitlement which the person did not previously have under the relevant terms of the person's employment." "Many of the cases concerning what an order for reinstatement comprehends, at least in the context of New South Wales industrial laws, were considered by the Industrial Commission of New South Wales in Court Session in Retail Traders Association (NSW) v Shop, Distributive and Allied Employees Association (NSW)56. In those authorities it is comparatively clear, to repeat some of the language used, that an order for reinstatement is not to achieve a notional or academic reinstatement but a practical one. It requires a re-establishment of the pre-existing employment relationship as a matter of reality and not in some notional or fictional way. The purpose of such an order is to place the dismissed employee in a position that he or she was in before the dismissal. It is to restore the status quo ante. 54 Ramsey Butchering Services Pty Ltd v Blackadder (2003) 127 FCR 381 at 416 55 (2003) 127 FCR 381 at 397-398 [21], [23]. In my opinion, the power to make an order under s 170CH(3)(a) or (b) extends to making an order requiring the employer to permit the employee to take up the position formerly occupied by the employee, or another position, including performing the duties of that position and receiving the benefits from doing so." On 21 February 2003 the Full Court made orders that: The appeal be allowed in part. Paragraph 2 of the orders made on 21 May 2002 be varied by deleting the words 'namely a boner performing chilled boning work in that part of the respondent's premises known as the big boning room' and that pars 3 and 4 of the orders be set aside. The appeal and cross-appeal otherwise be dismissed." The effect of these orders was to leave the order for reinstatement intact except to the extent that the appellant's duties were to be confined to boning in the chilled boning room. If they are to stand the respondent could, without more, direct the appellant to do work in the hot boning room which was work that the Commissioner had held he was neither fit nor trained to do. The appeal to this Court Section 170CH of the Act The order made by the Commissioner at first instance was made under s 170CH which provides, inter alia, as follows: "Remedies on arbitration Subject to this section, the Commission may, on completion of the arbitration, make an order that provides for a remedy of a kind referred to in subsection (3), (4) or (6) if it has determined that the termination was harsh, unjust or unreasonable. The Commission must not make an order under subsection (1) unless the Commission is satisfied, having regard to all the circumstances of the case including: the effect of the order on the viability of the employer's undertaking, establishment or service; and the length of the employee's service with the employer; and the remuneration that the employee would have received, or would have been likely to receive, if the employee's employment had not been terminated; and the efforts of the employee (if any) to mitigate the loss suffered by the employee as a result of the termination; and any other matter that the Commission considers relevant; that the remedy ordered is appropriate. If the Commission considers it appropriate, the Commission may make an order requiring the employer to reinstate the employee by: reappointing the employee to the position in which the employee was the termination. immediately before employed appointing the employee to another position on terms and conditions no less favourable than those on which the employee was the termination. immediately before employed If the Commission makes an order under subsection (3) and considers it appropriate to do so, the Commission may also make: any order that the Commission thinks appropriate to maintain the continuity of the employee's employment; and subject to subsection (5) – any order that the Commission thinks appropriate to cause the employer to pay to the employee an amount in respect of the remuneration lost, or likely to have been lost, by the employee because of the termination." The first question which the appeal raises is whether, under s 170CH the Commission may make an order for reinstatement, the effect of which is to require an employer to provide the employee with work, and, if it may, whether the order that was made here was of such a kind. The next question is whether, if the Commission may, and has made such an order the Federal Court should have made an order for its enforcement. As will appear, each of these questions should be given an affirmative answer. Section 170CH should not be read in the narrow fashion adopted by the majority in the Full Court of the Federal Court. To do so is to treat the word "position" as used in the Act as a formal position only, a title, or something in the nature of an office, entitling the person reappointed to it, to its emoluments and nothing else. Nor does anything turn on the use of the word "reappointing". An employee carrying out work of the kind being carried out by the appellant before his dismissal would not in ordinary language be regarded as undertaking work pursuant to an appointment. All of the language of the relevant section must be given meaning. The use in s 170CH(3) of the word "reinstate" is significant. Section 170CH(3)(a) and (b) describe the way in which the reinstatement may be effected. "Reinstate" literally means to put back in place. To pay the appellant but not to put him back in his usual situation in the workplace would not be to reinstate him. The words "reappoint" and "position" should not be read in any restricted way. They are intended to apply to a very wide range of workplaces and certainly not to a particular officer or officers. It was therefore within the power of the Commission to make such an order as would contemplate or require that the employer provide a reappointed or reinstated worker with actual work to do. In our opinion it is also at least implicit in the reasons for the order of the Commission at first instance that the appellant would be provided with actual work for him to do. This appears from the passages which dealt with the appellant's fitness to perform the work, and the conclusion that the appellant could do that which he had been doing before his employment was terminated. We do not take the Commissioner at first instance to have deliberated upon these matters only for the purpose of ascertaining whether the termination was in any way justified. He was also doing so for the purpose of considering whether reinstatement was appropriate, and whether upon its occurrence the appellant would be likely to be able to do the work which he had formerly been doing. Before making an order the Commission has to be satisfied of the matters referred to in s 170CH(2). Those matters included the effects (in the future) on the viability on the employer's business if an order (for reappointment) be made (s 170CH(2)(a)), the remuneration that the employee would have received if his employment had not been terminated (s 170CH(2)(c)), and any other matters that the Commission might consider relevant (s 170CH(2)(e)). With respect to the first of these, the Commission made the relevant finding that the operational requirements of the respondent's business would not be affected by the restoration of the appellant to his previous position. In any event it is almost unthinkable that the Commissioner would have made an order that the appellant be reappointed had he thought that the appellant would either not be able to perform, or would not be allocated actual work by the respondent for him to do. The order made by the Commissioner should be read as Moore J in dissent in the Full Court preferred to read it, as an order intending that the appellant be reinstated, and that he be given work to do of the kind which he had done in the past. It is no answer, as the respondent submits, that the appellant may be unwilling to do hot boning work, or that he may lack the physical and other capacities to do it. It is true that sub-cl 37.20 of the AWA provides that employees shall work as directed, but sub-cl 35.9 makes it clear that the directions may relate to such duties as are within an employee's skill, competence and training only. Commissioner Redmond has held, and it has not so far been controverted, that the appellant has not been trained, and is not fit, to do hot boning work. The Act empowers the Commission to reappoint an employee to the position in which he was employed immediately before his termination, or to another position, and this it did, by reappointing him to work in the chilled boning room. It is not for this Court to anticipate, by making an order in advance, what may follow from that. As Moore J in dissent in the Full Court said57: "That is not to say, however, that the employer would be precluded, thereafter, from lawfully altering the position of the employee by requiring the employee to perform other duties, standing down the employee or even dismissing the employee. An employer can. However, if these steps were taken capriciously or unreasonably it may be that they could be viewed as steps designed to nullify the effect of the reinstatement order. The order is intended to have the effect earlier described and, to that extent but only to that extent, overrides any contractual or other rights the employer may have." There is no doubt that the order made by Madgwick J in the Federal Court was within power. Section 170JC(3) confers a jurisdiction on that Court to enforce an order of the Commission. No question, whether under s 23 of the Federal Court of Australia Act 1976 (Cth)58, the Court might vary or alter the Commission's order arises here, because Madgwick J simply ordered, in substance, that the orders of the Commission be enforced with the addition of some further orders more fully and accurately reflecting the relevant provisions of the Act and the AWA. The circumstances of this case are covered by the federal statutory regime established by the Act and the Federal Court of Australia Act. Decisions in other 57 (2003) 127 FCR 381 at 399 [24]. 58 "Making of orders and issue of writs The Court has power, in relation to matters in which it has jurisdiction, to make orders of such kinds, including interlocutory orders, and to issue, or direct the issue of, writs of such kinds, as the Court thinks appropriate." jurisdictions under other statutory regimes are of little assistance. Nor are the decisions of other courts or this Court at common law. It is accordingly unnecessary to consider whether the categories of cases in which at common law actual work must be provided for an unlawfully terminated employee or contractor, are closed, although one might question the current relevance of judicial pronouncements made more than 60 years ago in the United Kingdom as to the extent to which an employer might be obliged to dine at home in order to provide work for his cook59. It may be that in modern times, a desire for what has been called "job satisfaction", and a need for employees of various kinds, to keep and to be seen to have kept their hands in by actual work have a role to play in determining whether work in fact should be provided. Nor is it necessary to have regard to the fact, which appears to have been overlooked by the Full Court, that the appellant's remuneration here could be affected by the actual work that he did, a matter which might of itself at common law justify an order that he be provided with actual work to do. The order for enforcement of the order of the Commission for reinstatement should be understood in the way in which it has been explained in these reasons. The appeal should be allowed. We would make orders as follows: Appeal allowed; Set aside the judgment and orders of the Full Court of the Federal Court of Australia dated 21 February 2003; and In place thereof, order that the appeal to that Court be allowed in part; that Order 4 of the orders of Madgwick J in the Federal Court of Australia dated 21 May 2002 be set aside and Order 3 be varied by deleting therefrom the words "and for a period of 14 days thereafter", but otherwise that such appeal be dismissed. 59 In Collier v Sunday Referee Publishing Co [1940] 2 KB 647 at 650 Asquith J said: "Provided I pay my cook her wages regularly she cannot complain if I choose to take any or all of my meals out."

HIGH COURT OF AUSTRALIA ZG OPERATIONS AUSTRALIA PTY LTD & ANOR APPELLANTS AND MARTIN JAMSEK & ORS RESPONDENTS ZG Operations Australia Pty Ltd v Jamsek [2022] HCA 2 Date of Hearing: 1 September 2021 Date of Judgment: 9 February 2022 ORDER Appeal allowed. Set aside the orders of the Full Court of the Federal Court of Australia made on 16 July 2020. The issues raised by the notice of cross-appeal be remitted to the Full Court of the Federal Court of Australia for determination, and the Full Court to otherwise make orders in accordance with the reasons of this Court. On appeal from the Federal Court of Australia Representation S J Wood QC and D Ternovski for the appellants (instructed by Agnew Legal) N C Hutley SC and R S Francois with A D Crossland for the respondents (instructed by Watson Law) New South Wales Business Chamber Limited appearing as amicus curiae, limited to its written submissions Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS ZG Operations Australia Pty Ltd v Jamsek Industrial law (Cth) – Nature of employment relationship – Employee or independent contractor – Where respondents previously employed by company as truck drivers – Where respondents agreed to "become contractors" and purchase own trucks – Where each respondent set up partnership with spouse – Where partnerships executed contract with company for provision of delivery services – Where contract provided partnerships to purchase trucks – Where contract provided partnerships be paid by company for delivery services – Whether respondents employees of company. Words and phrases – "contractual rights and obligations", "control", "disparity in bargaining power", contractor", "partnership", "provision of services", "sham", "substance and reality", "totality of the relationship", "worker", "written contract". "independent "employee", "goodwill", Fair Work Act 2009 (Cth), ss 13, 14. KIEFEL CJ, KEANE AND EDELMAN JJ. Between 1977 and 2017, Mr Jamsek and Mr Whitby1 ("the respondents") were engaged as truck drivers by the second appellant's predecessors in business and subsequently by the second appellant itself. That business has undergone several changes of ownership during the period of the respondents' engagements. From the respondents' commencement in 1977 until 1986, the business was owned by Associated Lighting Industries Pty Ltd. The business was transferred in 1986 to Thorn EMI Pty Ltd and again in 1993 to the first appellant, which was then named Thorn Lighting Pty Ltd. Finally, in 2015, there was a corporate restructure by which Thorn Lighting Pty Ltd was renamed ZG Operations Australia Pty Ltd ("ZG Operations") and responsibility for the sales division of the business, which included the arrangements with the respondents' partnerships, was transferred to the second appellant, ZG Lighting Pty Ltd ("ZG Lighting"). ZG Lighting engaged the partnerships until the date of their termination on 20 January 20172. For convenience, the various entities which engaged the respondents and their partnerships will be referred to in these reasons compendiously as "the company". The respondents were initially engaged as employees of the company and drove trucks provided by the company. However, in late 1985 or early 1986, the company insisted that it would no longer employ the respondents, and would continue to use their services only if they purchased their trucks and entered into contracts to carry goods for the company. The respondents agreed to the new arrangement and each of Mr Jamsek and Mr Whitby set up a partnership with his wife. Those partnerships purchased trucks from the company and executed a written agreement with the company for the provision of delivery services. Thereafter, the respondents made deliveries as requested by the company. Each partnership invoiced the company for the delivery services provided, and was paid by it for those services. Part of the revenue earned was used to meet the partnerships' costs of operating the trucks. The net revenue earned was declared as partnership income and split between husband and wife for the purposes of income tax. The agreement between the partnerships and the company was terminated in 2017. The respondents then commenced proceedings in the Federal Court of Australia seeking declarations in respect of statutory entitlements alleged to be owed to them as employees of the company pursuant to the Fair Work Act 1 Mr Whitby having been declared bankrupt, the second and third respondents in the appeal to this Court were the trustees of Mr Whitby's estate in bankruptcy. It is convenient, however, in these reasons to refer to Mr Whitby personally. Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 121 [27], Edelman 2009 (Cth) ("the FW Act"), the Superannuation Guarantee (Administration) Act 1992 (Cth) ("the SGA Act") and the Long Service Leave Act 1955 (NSW) ("the LSL Act"). In the proceedings, a question arose as to whether the respondents were "employees" for the purposes of the FW Act and the SGA Act and/or "workers" for the purposes of the LSL Act. The FW Act variously deploys the terms "employee" and "national system employee", depending on the context. Similarly, the SGA Act applies to an "employee". The LSL Act relevantly applies to a "worker", a term which is itself defined by reference to whether the person is "employed". Subject to one exception, it was not suggested by any party that the meaning of "employee" or "worker" differed in any material respect across the three statutory contexts or that they reflected a departure from the ordinary meaning of employment at common law3. The exception is s 12(2)-(11) of the SGA Act, which gives an expanded meaning to the terms "employee" and "employer" for the purposes of that Act. The sub-section relevant to the present appeal is s 12(3), to which reference will be made later in these reasons when considering the respondents' notice of cross-appeal. The primary judge (Thawley J) concluded that the respondents were not employees of the company, and instead were independent contractors4. The Full Court of the Federal Court of Australia (Perram, Wigney and Anderson JJ) allowed the respondents' appeal, holding that the respondents were employees of the company5. The reasons of the Full Court suffered from two errors of approach. The first was the significant attention devoted by that Court (and indeed the primary judge) to the manner in which the parties actually conducted themselves over the decades of their relationship. That was thought to be necessary because those courts took the view that a proper characterisation of the totality of the relationship required a consideration of how the parties' contract played out in practice. The second was the Full Court's reasoning that the disparity in bargaining power between the parties affected the contract pursuant to which the partnerships were See ss 11-13, 15, 30C, 30E of the FW Act; s 12(1) of the SGA Act; s 3(1) of the LSL Act. 4 Whitby v ZG Operations Australia Pty Ltd [2018] FCA 1934. Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114. Edelman engaged, so that the "reality" of the relationship between the company and each respondent was one of employment. The reasoning of the Full Court cannot be sustained. The respondents were not employed by the company. They were members of partnerships which carried on the business of providing delivery services to the company. The appeal to this Court must be allowed. This appeal was heard together with the appeal in Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd6 ("CFMMEU v Personnel Contracting"). In the present case, as in CFMMEU v Personnel Contracting, there was no suggestion that the contract between the parties was a sham or had been varied or otherwise displaced by conduct of the parties. There was no claim by the respondents to set aside the contract either under statute or pursuant to equitable doctrines such as those relating to unconscionable conduct. In these circumstances, and for the reasons given in CFMMEU v Personnel Contracting, the character of the relationship between the parties in this case was to be determined by reference to the rights and duties created by the written agreement which comprehensively regulated that relationship. The circumstance that entry into the contract between the company and the partnerships may have been brought about by the exercise of superior bargaining power by the company did not alter the meaning and effect of the contract. In addition, as a practical matter of the due administration of justice, the task of raking over the day-to-day workings of a relationship spanning several decades is an exercise not to be undertaken without good reason having regard to the expense to the parties and drain on judicial time involved in such an exercise. The claims made by the respondents in this case did not give rise to an occasion for such an exercise, those claims involving no suggestion that any aspect of the day-to-day performance of the contract superseded the rights and duties established by the contract. That having been said, however, in order to aid an understanding of the reasons of the courts below and of the arguments in this Court, it is desirable to summarise the salient aspects of the history of the dealings between the parties. The factual background Mr Jamsek and Mr Whitby left high school at 14 and 15 years of age respectively. Neither has any formal qualifications, and both have only ever [2022] HCA 1. Edelman worked in jobs requiring manual labour. Both Mr Jamsek and Mr Whitby began working for the company in 1977 and became delivery drivers in 1980. There is no dispute that, at least until late 1985 or early 1986, they were employees of the company7. During this time, they drove trucks that were provided by the company8. The 1986 contract In late 1985, aware that the company was planning to move locations, Mr Jamsek and another truck driver approached the company to request a pay rise to compensate them for the additional travel time. The request was rejected. A few weeks later, the company informed all five of its drivers, including Mr Jamsek and Mr Whitby, that it would not offer a pay rise but instead would offer the opportunity for the drivers to "become contractors", which would involve the drivers purchasing their own trucks. The drivers were told: "If you don't agree to become contractors, we can't guarantee you a job going forward"9. Each of the company's five drivers accepted the offer10. Each of Mr Jamsek and Mr Whitby, on the advice of his accountant, set up a partnership with his wife (referred to in these reasons as "the Jamsek partnership" and "the Whitby partnership" respectively)11. To give effect to the new arrangements, Mr Jamsek and Mr Whitby executed a written contract with the company ("the 1986 contract"). A copy of the 1986 contract could not be located when the proceedings commenced, and it was not in evidence at trial. Nevertheless, the primary judge inferred that, consistently with later contracts, each respondent entered into the 1986 contract on behalf of his partnership12. Pursuant to the 1986 contract, the drivers were paid a minimum "carton rate" of $120 per day (or $600 per week). Before the 1986 contract, Mr Whitby Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 153 [202]. Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 122 [38]-[39]. 10 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 122 [40]. 11 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 122 [35]-[36]. 12 Whitby v ZG Operations Australia Pty Ltd [2018] FCA 1934 at [22]. Edelman was earning approximately $410 per week13. Mr Whitby was also paid out his accrued annual leave balance at the time of entering into the 1986 contract14. The partnerships purchase trucks Consistently with the proposal that led to the 1986 contract, Mr Jamsek and Mr Whitby each purchased a four-tonne delivery truck from the company for sums of $15,000 and $21,000 respectively. Each borrowed money to finance the purchase15. The primary judge inferred that these trucks, like the trucks that were purchased subsequently, had been purchased by each respondent on behalf of his partnership16. The partnerships paid all expenses associated with the trucks, including registration, maintenance, and interest on the funds borrowed to finance their purchase17. New trucks were acquired by the Whitby partnership in 1989 (for $70,000)18, by the Jamsek partnership in 1990 (for between $70,000 and $80,000)19, and by the Whitby partnership in 1993 (on lease)20. Other than the truck leased by the Whitby partnership, in each instance the relevant partnership obtained finance to fund the purchase of the new truck. In the case of the Jamsek partnership, the finance for the acquisition in 1990 was paid back over a period of 13 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 122- 14 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 123 [42]. 15 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 123 [43]-[45]. 16 Whitby v ZG Operations Australia Pty Ltd [2018] FCA 1934 at [23]. 17 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 123 [46]. 18 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 123-124 [50]. 19 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 124 [51]. 20 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 127 [61]. Edelman 10 years21. The respondents did not negotiate with the company as to the type or model of truck purchased22. In 2010, Mr Whitby purchased a utility vehicle. This vehicle was initially purchased for private use, but Mr Whitby later notified the company that he had purchased the ute and offered to use it to make smaller deliveries for the company in metropolitan areas where it was difficult to manoeuvre a large truck. He began using the ute for small deliveries that the company had previously engaged external couriers to perform23. From 2010, Mr Whitby made deliveries using his ute, rather than his truck, most of the time. It was largely left to Mr Whitby to decide which vehicle to use for deliveries24. After owning the first ute for approximately four years, Mr Whitby purchased a second ute, which was also used to make The 1993 contract and subsequent rate reviews In 1993, Mr Whitby (for himself and on behalf of Mr Jamsek) and several other drivers approached the company and negotiated a new arrangement under which the partnerships would invoice the company on an hourly rate on the basis of a nine-hour working day, although it was understood, and the contract provided, that actual hours worked might vary. The partnerships executed a written "Contract Carriers Arrangement" with the company in July 1993 ("the 1993 contract")26. 21 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 123-124 [50]- 22 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 124 [50], 23 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 130 [81]. 24 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 131 [84]. 25 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 130 [82]. 26 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 124 [52], Edelman The 1993 contract included the following terms: The Contractors so named are: Separate legal entities both from each other and THORN LIGHTING. Able to work for other parties, providing that such work is not detrimental to either THORN LIGHTING or THORN LIGHTING customers. To present an invoice for work carried out in the preceding week. THORN LIGHTING and the Contractors have agreed: The Contractors will: Undertake carriage of goods as reasonably directed Comply with all Acts, Ordinances, Regulations and By-laws relating to the registration, third party insurance and general operation of the vehicle within New South Wales. Pay all legal costs, such as tax and duty, payable in respect of the vehicle and keep the vehicle in a mechanically sound, road worthy and clean condition. Be responsible for the vehicle equipment and gear, the safe loading of the vehicle and the securing and weather protection of the load. Exercise all reasonable care and diligence in the carriage and safe keeping of the goods in their charge. Account for all goods by use of run sheets and return of signed delivery dockets or similar documents. Hold at all times and on request produce for inspection, a current driver's licence issued in respect of a vehicle of the class of the vehicle in use and immediately notify THORN LIGHTING if the licence is suspended or cancelled. Not engage or use the services of a driver for the vehicle without prior and continuing approval by THORN LIGHTING. Such driver is to be correctly licensed, suitably Edelman dressed, and in all other respects entirely to the satisfaction of THORN LIGHTING. Obtain and maintain a public liability insurance policy for an amount of $2,000,000 or greater in respect of any liability incurred by the Contractor in performance of work for THORN LIGHTING. Obtain and maintain a comprehensive motor insurance policy over the vehicle including cover for amount of $5,000,000 or greater for third party property damage in respect of one accident. Ensure that such policies include an indemnity of THORN LIGHTING for any action of the Contractor to which the policy applies. Produce on request a current receipted copy of such policies. Immediately report any accident to the person in charge of the NSW Branch Warehouse and to attend to any legal requirements at the scene or subsequent to the accident. Not offer his vehicle for sale with any guarantee of either continuity of work for THORN LIGHTING, or implied acceptance by THORN LIGHTING of the purchaser." The 1993 contract also provided for four weeks annual leave without pay and noted that allowances for annual leave, public holidays and sick days had already been made in the hourly rate27. Further contracts were executed between the partnerships and the company in 1998 and 2001. Each new contract was prompted by a request on behalf of the drivers for an increase in the hourly rate of pay, which was motivated on each occasion by concerns about increased costs, including for fuel, registration and insurance. Besides the changes to the hourly rate, for present purposes there were 27 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 125 [57]. Edelman no other material changes to the contracts28. A further rate increase was approved in 2008, prompted by similar concerns from the drivers about rising costs29. Making deliveries Initially, the company gave the drivers delivery dockets, which were to be signed by customers upon each delivery. From around 2001, the drivers were also required to fill out "manifest run sheets", which outlined the deliveries to be completed that day and allowed company managers to identify where the drivers would be at certain times. Each run sheet would record the driver's arrival at the warehouse in the morning, would be signed by each customer upon delivery, and would record the time the driver had completed deliveries for the day. The drivers were to return the run sheets to the warehouse at the end of the day, or the next morning if the driver went straight home after his last delivery. Apart from the run sheets, the drivers were not required to fill out any other document akin to a timesheet30. Although the drivers were told what to deliver, they were left largely to agree amongst themselves on their respective delivery areas. Each driver structured his own delivery route. By around 2001, Mr Whitby, who lived about 160 kilometres from the company's warehouse, would relatively frequently drive home after making his last delivery, rather than return to the warehouse. He would structure his route such that he made his deliveries closest to the warehouse first and made his deliveries furthest away from the warehouse last31. In some years, the Whitby partnership rented a property near the warehouse, to save the costs of Mr Whitby travelling between the warehouse and his home32. The company's warehouse staff were responsible for picking and packing orders for delivery. Items for delivery would then be moved on pallets to the 28 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 127 [62]-[63], 29 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 30 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 128 [71]-[72]. 31 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 32 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 135 [120]. Edelman despatch area at the warehouse and sorted into runs, initially by warehouse staff. During this time, the drivers were instructed to wait in the canteen. From around 2006, a company manager told Mr Whitby that he was to start sorting his own run by himself. After six months, Mr Whitby was told that he was not to sort his run inside the warehouse, and should do so outside the warehouse. Warehouse staff would then load the sorted items onto the truck. Mr Whitby would sometimes shift the items around inside the truck to ensure safe transit of the goods, using a pallet In 2009, the drivers approached the company and proposed that they perform non-metropolitan deliveries. The company agreed to "give it a go" if it would be cheaper for the company than paying others to make those deliveries. From time to time thereafter, the company would approach a driver to see if he was interested in a non-metropolitan delivery and, if the driver was interested, he would quote for that job and complete it, if approved34. Financial arrangements The income from the work performed by Mr Jamsek and Mr Whitby for the company was declared as income of each partnership and split, generally evenly, between husband and wife35. Generally, each partnership paid for running costs and other expenses associated with the trucks, including public liability insurance and motor vehicle insurance. These were claimed as deductions for tax purposes36. In the case of Mr Whitby, the Whitby partnership also claimed deductions in respect of the rental property used to minimise Mr Whitby's travelling costs between the warehouse and home37. 33 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 122 [33], 34 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 130 [80]. 35 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 133 [110], 36 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 37 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 135 [120]. Edelman As required by cl 1(c) of the contract, the partnerships invoiced the company for their work38. After the introduction of GST in 2000, each partnership charged GST to the company in relation to the services it supplied, and provided the company with tax invoices39. In 2012, the Whitby partnership was dissolved. Mr Whitby continued supplying his services, now as a sole trader using his own ABN. In his subsequent tax returns, Mr Whitby declared that he was carrying on a business in respect of a "transport operation" or a "courier service". He continued to claim deductions in respect of depreciation and expenses associated with the trucks40. Working hours and leave Mr Jamsek and Mr Whitby worked more or less regular hours, usually arriving at the warehouse between 6.00 am and 7.00 am and finishing deliveries around 3.00 pm41. In 2000, Mr Jamsek took six or seven weeks of leave. During this period, a friend of Mr Jamsek drove his truck and the Jamsek partnership paid the friend for his work. The company paid the Jamsek partnership as usual42. In 2010, Mr Jamsek took five or six weeks of leave. During this period, he handed his run to other drivers at the company or, if those drivers could not take on his deliveries, the deliveries were done by external couriers43. 38 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 149 [188]. 39 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 134 [118], 40 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 135 [123]-[124]. 41 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 132 [100]-[103], 42 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 132 [97]. 43 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 132 [98]. Edelman Mr Jamsek took leave on several other occasions, and took two weeks annual leave over Christmas each year44. Logos, uniforms and livery At various times throughout their engagements, the respondents were asked by the company to install tarpaulins bearing the company logo on the trucks. On some occasions, the respondents installed the tarpaulins themselves; on other occasions, the company installed the tarpaulins, or contributed towards the costs of installation45. In 2010, Mr Whitby converted his truck to become a "flatbed", and from that time onwards his truck did not bear a company logo46. At various times throughout their engagements, the respondents were supplied with uniforms bearing the company logo, including on occasions following a transfer of the business to a new entity47. The primary judge found that the respondents wore a mix of personal and branded clothing48. They were not instructed by the company to wear a uniform, although from 2014 they were required to wear high-visibility vests inside the warehouse49. Other work besides deliveries The respondents were occasionally asked to perform tasks beyond their core delivery duties. Around 2012, Mr Jamsek and Mr Whitby were told by warehouse management that they were to start scanning the manifest run sheets to give to warehouse staff. When Mr Jamsek told the warehouse foreman that it was not part 44 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 132 [98]-[99]. 45 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 124 [51], 46 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 131 [83]. 47 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 126 [58], 48 Whitby v ZG Operations Australia Pty Ltd [2018] FCA 1934 at [188]. 49 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 133 [108], Edelman of his job, he was told that he had to do the clerical work. The respondents performed this task daily for the remainder of their engagements. Mr Whitby estimated that the task took 15 minutes per day to complete50. The respondents were occasionally asked by company warehouse staff to assist in cleaning up behind the warehouse while a stocktake was being undertaken. Neither assisted in the actual stocktake51. Both respondents also occasionally used their trucks to assist in relocations of the factory or warehouse, for which they were paid their usual rate52. From time to time, the respondents would also collect and return empty pallets to the warehouse, for which they would charge the company. There was no evidence that the respondents were directed to do so. The primary judge The primary judge concluded that, having regard to the totality of the parties' relationship, Mr Jamsek and Mr Whitby were not "employees" of the company for the purposes of the FW Act and the SGA Act, nor were they "workers" for the purpose of the LSL Act53. Rather, in his Honour's view, the case was "an example of partnerships (and from 1 July 2012, Mr Whitby) running businesses of their own"54. The primary judge considered that the events in 1986, including the formation of the partnerships, the payment of Mr Whitby's annual leave, and the purchase by the respondents of trucks, demonstrated a mutual intention that significant aspects of the existing relationship would change from the employment relationship subsisting to that time55. In the primary judge's view, this mutual 50 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 131 [85]-[87]. 51 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 52 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 133 [107]. 53 Whitby v ZG Operations Australia Pty Ltd [2018] FCA 1934 at [212], [218], [224]. 54 Whitby v ZG Operations Australia Pty Ltd [2018] FCA 1934 at [213]. 55 Whitby v ZG Operations Australia Pty Ltd [2018] FCA 1934 at [133]. Edelman intention to alter the structure of the relationship was reflected in the written contract56. The primary judge considered that the provision of trucks (and, in Mr Whitby's case, utes) was a significant factor – especially given the substantial value of those vehicles – which favoured a characterisation of the respondents as independent contractors57. The provision of services through the vehicle of a partnership (and, in Mr Whitby's case, later as a sole trader) also weighed in favour of a conclusion that the respondents were independent contractors. In this regard, the primary judge described the partnerships as having "conducted their affairs as one would expect of a business"58, in that the partnerships bore the costs associated with purchasing and operating the trucks, and so bore the risk that the provision of services to the company would not be a profitable venture. In the primary judge's view, these were significantly higher risks than the risks Mr Jamsek and Mr Whitby would have faced as employees59. The company had submitted that the respondents' work did not involve the development of goodwill, on the basis that cl 2.1(k) of the contract restrained the respondents from selling their trucks with any guarantee of continuing work for the company. His Honour rejected this submission, noting that the clause did not prohibit the sale of a business and, if anything, suggested that the parties contemplated that the respondents might otherwise have something over and above the value of the trucks to sell. In the upshot, his Honour regarded this factor as insignificant60. The primary judge concluded that the company's right of control was less extensive than was typical of an employer-employee relationship. In this regard, the primary judge emphasised the absence of control over the manner in which the respondents conducted their deliveries or their decisions to purchase the trucks61; 56 Whitby v ZG Operations Australia Pty Ltd [2018] FCA 1934 at [177]. 57 Whitby v ZG Operations Australia Pty Ltd [2018] FCA 1934 at [156], [166]. 58 Whitby v ZG Operations Australia Pty Ltd [2018] FCA 1934 at [145]. 59 Whitby v ZG Operations Australia Pty Ltd [2018] FCA 1934 at [145]-[147], [149]-[150]. See also [184]. 60 Whitby v ZG Operations Australia Pty Ltd [2018] FCA 1934 at [151]-[152]. 61 Whitby v ZG Operations Australia Pty Ltd [2018] FCA 1934 at [189]. Edelman the absence of any direction to wear a uniform62; the flexibility around choosing the delivery area, delivery route and whether to return home after completing deliveries63; and the circumstance that Mr Jamsek paid for someone else to carry out his deliveries while he was on leave in 200064. In the primary judge's view, the circumstance that the company told the respondents what to deliver was not significant; such instructions would be equally given to an external courier65. Against these factors, the primary judge regarded each respondent's length of service, regularity of working hours and consistency of working arrangements as characteristics typical of an employment relationship66. The primary judge noted that while the respondents did not serve other customers besides the company, there was no restriction preventing the respondents from serving other customers, either by driving their trucks outside the hours which they contracted to work for the company or by engaging others to drive their trucks on the weekends67. Finally, the primary judge observed that the circumstance that the respondents were asked to assist in cleaning the warehouse during stocktakes was not a strong indicator of an employment relationship, but rather was consistent with the "give-and-take" one might expect of such a long-standing relationship68. The Full Court The Full Court allowed the appeal. Anderson J wrote the leading judgment, with which Perram J and Wigney J agreed, each adding some further remarks as to the factors their Honours considered most significant in the overall balancing of relevant factors. 62 Whitby v ZG Operations Australia Pty Ltd [2018] FCA 1934 at [188]. 63 Whitby v ZG Operations Australia Pty Ltd [2018] FCA 1934 at [187], [205]. 64 Whitby v ZG Operations Australia Pty Ltd [2018] FCA 1934 at [211]. 65 Whitby v ZG Operations Australia Pty Ltd [2018] FCA 1934 at [190], [199]. 66 Whitby v ZG Operations Australia Pty Ltd [2018] FCA 1934 at [183]. 67 Whitby v ZG Operations Australia Pty Ltd [2018] FCA 1934 at [185]. 68 Whitby v ZG Operations Australia Pty Ltd [2018] FCA 1934 at [209]. Edelman The Full Court emphasised that the ultimate question – whether either respondent was an employee – was to be answered by reference to the "substance and reality" of the relationship69. The Full Court emphasised that this was not the same question as asking whether either respondent was conducting his own business, noting that the distinction between a person serving his or her employer's business and a contractor conducting a business of his or her own "may not represent a perfect dichotomy"70. The task of ascertaining the "substance and reality" of the relationship was approached by the Full Court explicitly as a "matter of impression"71 by reference to the history of the parties' dealings with each other over many decades. The Full Court proceeded on the footing that it was necessary to embark on such an exercise having regard to the need to consider "the totality of the relationship" between the parties beyond the terms of their written contracts72. It was said that at the heart of this conclusion was73: "a preference for the substance of the relationship ... over certain aspects of the contractual obligations governing the relationship, and the legal structures through which the [respondents] contracted." The Full Court went on to say74: "[T]he essence of the legal framework between the parties involved the [respondents], for large part through their Partnerships, contracting with the company, with the [respondents'] work. These are, on their face, indications that the [respondents] were operating an independent business. But ... they are the Partnerships [supplying] the vehicles for 69 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 147 [182]. 70 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 147 [181]. See also 118 [8], 119 [14]. 71 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 165 [242]. 72 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 165 [242]. 73 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 165 [243]. 74 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 165 [243]. Edelman outweighed by the particular, and perhaps peculiar, attributes of the long relationship between the parties." Speaking broadly, this approach is erroneous in point of principle for the reasons given in CFMMEU v Personnel Contracting75. In relation to the particular matters identified by the Full Court as leading to a conclusion as to the character of the relationship that was contrary to the indications "on the face" of the parties' agreements, a consideration of those matters helps to illustrate why the conclusion reached by the Full Court was not soundly based in principle. The first point made by the Full Court in this regard was that there was limited evidence that the respondents' wives contributed to work that generated income for the partnerships. On that basis, it was concluded that the respondents and their wives were "partners in name only"76. It is necessary to recall here that it was no part of the respondents' case that the partnerships were shams. And, in any event, partnerships in which one partner does not contribute his or her service to the partnership business are commonplace. There is no reason to view these partnerships differently. As to the circumstances surrounding the making of the 1986 contract and the alteration thereby effected to the nature of the parties' relationship, the Full Court held that the parties' intentions in entering into the 1986 contract "must be characterised in light of the reality of the respective bargaining positions of each party"77. In the Full Court's opinion, because "the reality" was that there was little or no room for negotiation and the respondents were faced with "an effective ultimatum" of either redundancy or the restructured arrangement, the significance of entry into the 1986 contract was diminished78. It was also said that the significance of the respondents' investment in and deployment of their vehicles was lessened by the circumstances that the respondents were effectively compelled to purchase the trucks as part of entering into the 1986 contract; that the trucks were subsequently adorned with the company's logo for most of the duration of the [2022] HCA 1 at [40]-[62]. 76 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 149 [191]. 77 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 151 [196]. 78 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 Edelman engagements; and that driving the trucks did not require an exceptional level of skill79. It is necessary to note in these observations of the Full Court the expansive approach taken to determining the "substance and reality" of the relationship between the parties, and especially the significance attached to the disparity in bargaining power as itself affecting the meaning or effect of what the parties had agreed. This expansive approach accords with that which has been taken in the United Kingdom80. For the reasons stated in WorkPac Pty Ltd v Rossato81 and in CFMMEU v Personnel Contracting82, this expansive approach involves an unjustified departure from orthodox contractual analysis. Next, the Full Court considered that the circumstance that the company "ostensibly required, or at least expected"83 the respondents to adorn their trucks and themselves with the company logo deserved greater emphasis than was apparent from the decision of the primary judge. It was reasoned that, although there may not have been a prescriptive policy or any express directions regarding clothing, the evidence "support[ed] the inference of an expectation" that the respondents would ordinarily wear company-branded clothing84. It was noted further that this expectation would lead stakeholders to identify the respondents as part of the company's staff, which may have limited the opportunity for the respondents to obtain work from others85. The "expectations" referred to by the Full Court did not alter the contractual rights and obligations which characterised the relationship between the 79 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 80 Autoclenz Ltd v Belcher [2011] 4 All ER 745. (2021) 95 ALJR 681 at 694-695 [62]-[64]; 392 ALR 39 at 53-54. [2022] HCA 1 at [40]-[62]. 83 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 160 [224]. 84 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 160 [224]. 85 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 160-161 [225]. See also 120 [17]-[18]. Edelman partnerships and the company86. Moreover, the willingness of the respondents to display the company's branding on their trucks is quite consistent with a sensible, self-interested response of an independent contractor to legitimate commercial pressure from its best customer. Next, the Full Court found that, apart from the incident in 2000 when a friend of Mr Jamsek drove his truck on his behalf for several weeks, the respondents "devoted" their working lives and the vehicles owned by their partnerships to the company. Although the Full Court accepted that the respondents were entitled under the contract to work for third parties, it was concluded that, in light of the "expectation" that the respondents would work nine hours a day, five days a week for the company, there was "in practice" minimal time for them to undertake work for others87. To say these things is to say little more than that the demand by the company for the services rendered by the partnerships was such that the partnerships had no further capacity to serve the needs of other customers. Such a state of affairs is not inconsistent with the independent status of the partnerships. And in any event, "expectations" of the kind referred to by the Full Court are not apt to alter, and indeed were not alleged to have altered, the rights and duties which characterised the relationship between the partnerships and the company. Clause 2.1(g) did not exclude the possibility of engaging alternative drivers with the company's approval, the company's right to grant or withhold approval recognising its interest in the safe transport of its goods. The same may be said of the observation by the Full Court that the respondents did not engage in "entrepreneurial or profit motivated activity", which was "a hallmark of an independent business"88. In this regard, the Full Court noted the length of their service, that work from the company was their sole source of 86 cf WorkPac Pty Ltd v Rossato (2021) 95 ALJR 681 at 694-695 [62]-[64]; 392 ALR 87 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 88 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 165 [244], citing On Call Interpreters and Translators Agency Pty Ltd v Federal Commissioner of Taxation [No 3] (2011) 214 FCR 82 at 142 [291]; Fair Work Ombudsman v Quest South Perth Holdings Pty Ltd (2015) 228 FCR 346 at 390 [181]. Edelman income, and that they did not drive for any other entity89. The "lengthy and devoted" nature of the working relationship, in the Full Court's view, "colour[ed]" the manner in which the relevant circumstances of the relationship were to be assessed for the purposes of the multifactorial test90. None of these considerations is a basis for disregarding the effect of the agreement between the partnerships and the company. Finally, the Full Court considered that the partnerships generated no goodwill. Clause 2.1(k) denied any guarantee of continuity of work from the company were the vehicles to be sold. That being so, there was said to be "nothing for the [respondents] to sell over and above their vehicles"91. Perram J highlighted the absence of any goodwill in the respondents' businesses as the "most important element" in his reasoning to the conclusion that the respondents were employees of the company92. The circumstance that the contract did not entitle the partnerships to sell their businesses accompanied by a right to continue providing delivery services to the company did not prevent the generation of goodwill. Each partnership was at liberty to introduce a purchaser of its business to the company as an established customer. Whether a purchaser would see sufficient value in such an introduction to pay a substantial sum for it would depend upon the circumstances of the market. More importantly, many businesses – such as manufacturers of products for a single customer – do not generate goodwill. That is a feature of the niche in the market occupied by those businesses; it is not a circumstance which denies the independence of such businesses from their customers. It will be apparent from this review that the reasons of the Full Court cannot sustain the decision to reverse the primary judge's decision. One may now turn to consider the arguments agitated by the parties in this Court. The parties' contentions in this Court The appellants emphasised the finding of the primary judge that the respondents, as members of their partnerships, were engaged in the conduct of their 89 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 165 [244]. 90 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 166 [247]. 91 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 164 [237]. 92 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 118 [9]. Edelman own businesses93. That finding was clearly correct. Given that there is no basis for holding that the respondents were otherwise associated with the company, there is no basis for concluding that the respondents were employed by the company. The only relationship between the respondents and the company was that the respondents were members of partnerships that had agreed to make deliveries for the company. On the orthodox approach to the interpretation of contracts, regard may be had to the circumstances surrounding the making of a contract94. The 1986 contract between the partnerships and the company came to be made because of the company's insistence that the only ongoing relationship between the respondents and the company would be that established by the 1986 contract and that the partnerships would own and operate the trucks which would transport the company's deliveries. Given that the genesis of the contract was the company's refusal to continue to employ the respondents as drivers, and the respondents' evident acceptance of that refusal, it is difficult to see how there could be any doubt that the respondents were thereafter no longer employees of the company. The circumstance that this state of affairs was brought about by the exercise of superior bargaining power by the company weighed heavily with the Full Court; but that circumstance has no bearing on the meaning and effect of the bargains that were struck between the partnerships and the company. To say this is not to suggest that disparities in bargaining power may not give rise to injustices that call for a legal remedy. The law in Australia does provide remedies for such injustices under both the general law and statute. Those remedies were not invoked in this case. As has been noted earlier, the respondents did not claim that the contracts with the partnerships were shams. Nor did they seek to make a claim under statute or otherwise to challenge the validity of the contracts that were made by the partnerships. In Australia, claims of sham cannot be made by stealth under the obscurantist guise of a search for the "reality" of the situation95. Even if this disguised submission of sham were to be countenanced, the reality of the situation is that the partnerships, and not the respondents individually, owned and operated the trucks. The partnerships contracted with the company and 93 Whitby v ZG Operations Australia Pty Ltd [2018] FCA 1934 at [213]; Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 119 [11], 149 [190]. 94 Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 CLR 337 at 352; Narich Pty Ltd v Commissioner of Pay-roll Tax [1983] 2 NSWLR 597 at 601. 95 See WorkPac Pty Ltd v Rossato (2021) 95 ALJR 681 at 694-695 [62]-[64]; 392 ALR 39 at 53-54; cf Autoclenz Ltd v Belcher [2011] 4 All ER 745 at 752-757 [20]-[35]. Edelman invoiced the company for delivery services provided by the operation of the trucks. The partnerships earned income from the company, incurred expenses associated with the ownership and operation of the trucks, and took advantage of tax benefits of the structure. It is not possible to square the contention that the respondents were not conducting a business of their own as partners with the circumstance that, for many years, they enjoyed the advantages of splitting the income generated by the business conducted by the partnerships with their fellow partners. The respondents submitted that the contract between the company and the partnerships could be reconciled with the contention that the respondents were employees by recognising that, while the business of the partnerships was the ownership of the trucks, the labour involved in driving those trucks was undertaken by Mr Jamsek and Mr Whitby individually, in the service of the business of the company. In the respondents' submission, there was no inherent incoherence in this state of affairs because partners may, and commonly do, hold other offices or employment outside their partnership. In support of these contentions, counsel for the respondents advanced a strained interpretation of the 1993 contract. It was said that the contract contemplated that certain of the obligations contained therein (such as the supply of the trucks) were obligations of the partnerships, while other obligations (such as the obligation to hold a current driver's licence) could only sensibly be seen as applying to Mr Jamsek and Mr Whitby as individuals. This interpretation was said to be open on the loose drafting of the 1993 contract, including the oscillating use of the expressions "his" or "the Contractor" to describe the relevant obligor. In essence, though the 1993 contract comprised but the one document, in reality the document contained a "multiplicity" of contracts. Once that premise was accepted, the respondents submitted, the obligation in cl 2.1(a) of the 1993 contract to undertake carriage as reasonably directed – an obligation attaching to the respondents as individuals – manifested a right of control over the work of the respondents that was so comprehensive as to establish that they were employees. As the appellants rightly submitted, the contract between the partnerships and the company did not divorce the obligations concerning provision of the trucks from the obligations concerning provision of the labour of Mr Jamsek and Mr Whitby. Both aspects were bound up in the services provided by the partnerships. As both sides to the contract plainly knew, the ownership of the trucks alone was of no use to anyone unless they were operated by drivers with the skills of the respondents. The two elements had to be deployed together to provide the services to earn the fees charged by the partnerships to the company. The 1993 contract (and the subsequent contracts) expressly contemplated that the partnerships stood on one side of the bargain and the company stood on the other, and that the partnerships were to provide carriage services by trucks Edelman driven by the active member of the partnerships in return for payment to the partnerships. And insofar as some provisions of the 1993 contract contained obligations which related to an individual, it is not open to doubt that those obligations applied to the active member of the partnership, for whom the partnership was responsible. However poorly drafted the 1993 contract may be, and while the complex arrangement propounded by the respondents may be theoretically possible, such an arrangement cannot reasonably be discerned from the text of the contract. It is an interpretation that has no appeal as a reasonable commercial arrangement. As to cl 2.1(a) of the contract, the obligation to undertake carriage "as reasonably directed" was not, as counsel for the respondents submitted, akin to a power of the company to "micromanage" the conduct of the deliveries. That clause is to be understood in the context of provisions that highlight that it was the partnerships which had responsibility for the conduct of the deliveries. With that context, the better view of the clause, as a matter of the ordinary meaning of the text, is that it created an obligation as to what carriage was to be undertaken rather than how it was to be carried out. In this sense, as the primary judge observed96, such an obligation would be at the core of any engagement of an external courier to deliver goods. The qualification of the obligation to undertake carriage "as reasonably directed" served to ensure that the company could not over-stretch the partnerships' capacity by requiring them to deliver goods in such volumes as might put them in breach of their obligations. The respondents' submissions must be rejected. The services provided by the partnerships involved, compendiously, the truck-driving skills of the respondents and the use of the trucks owned by the partnerships. The provision of such services has consistently been held, both in Australia and in England, to have been characteristic of independent contractors, not employees97. In the present case, there is no reason to reach a different conclusion. 96 Whitby v ZG Operations Australia Pty Ltd [2018] FCA 1934 at [190], [199]. 97 Humberstone v Northern Timber Mills (1949) 79 CLR 389; Barro Group Pty Ltd v Fraser [1985] VR 577; Ready Mixed Concrete (South East) Ltd v Minister of Pensions and National Insurance [1968] 2 QB 497. Edelman The proposed cross-appeal: expanded definition of "employee" under s 12(3) of the SGA Act The respondents filed a notice of cross-appeal in which they contended that Mr Jamsek and Mr Whitby fell within the expanded definition of "employee" pursuant to s 12(3) of the SGA Act. That sub-section provides: "If a person works under a contract that is wholly or principally for the labour of the person, the person is an employee of the other party to the contract." The primary judge rejected the contention that the respondents fell within s 12(3) for two reasons. First, the relevant contracts were between the company and the partnerships, and not the respondents as individuals. Secondly, the contracts were not "principally for the labour of the person", but rather "were plainly for the provision of substantial equipment" as well as labour98. The Full Court, having concluded that the respondents were employees according to the ordinary meaning of that term, considered that it was unnecessary to deal with s 12(3) in order to dispose of the appeal99. As a consequence, this Court does not have the benefit of the Full Court's reasoned resolution of the issue sought to be raised by the proposed cross-appeal. Ordinarily, that circumstance would warrant the refusal of special leave to bring the cross-appeal. That would be unfair in this case, given that the Full Court did not consider the respondents' submissions in relation to s 12(3) because their claim could be sustained on another basis. The respondents submitted that the primary judge's first reason for rejecting the applicability of s 12(3) was erroneous. In the respondents' submission, all s 12(3) required was that the person work "under" a contract, not that the person was himself or herself a party to the contract. As for the primary judge's second reason, the respondents submitted that although one of the purposes of the contract was the provision of equipment, the contract remained one that was "principally" for the labour of the drivers. The arguments advanced by the respondents are not insubstantial. They cannot be dismissed out of hand. Acceptance of these arguments would have substantial consequences for the revenue. It would be inappropriate for this Court to determine these issues in circumstances where the Commissioner of Taxation 98 Whitby v ZG Operations Australia Pty Ltd [2018] FCA 1934 at [218]-[220]. 99 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 168 [255]. Edelman was not a party to the proceedings, and where the Full Court did not address these questions. So far as the proposed cross-appeal by the respondents is concerned, the justice of the case would be met by an order that the issues raised by the notice of cross-appeal be remitted to the Full Court to enable that matter to be determined following the joinder of the Commissioner of Taxation. Orders The appeal should be allowed, and the orders made by the Full Court on 16 July 2020 be set aside. The issues raised by the notice of cross-appeal should be remitted to the Full Court for determination, and the Full Court should otherwise make orders in accordance with these reasons. GAGELER AND GLEESON JJ. In contrast to the companion appeal in Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd ("CFMMEU")100, which concerns a labour hire arrangement of a kind that has come to prominence with the disaggregation of business structures in the late 20th and early 21st centuries, the controversy underlying this appeal arises out of a scenario well known in an earlier industrial age. A company with an established workforce of employees wants to change the structure of its business to turn them into independent contractors. To achieve that change, the company proffers written contracts which its workers sign. The conduct of the business of the company goes on with little change in practice. Later, an issue arises in a taxation or superannuation or workplace compensation or workplace entitlement context about whether the company achieved its aim. A worker claims that the written contract cannot obscure the reality that the true nature of his or her relationship with the company did not change at all. Faced with claims of that type, to the extent necessary to adjudicate the issues in dispute, courts and tribunals applying common law principles have been astute to ascertain what the real relationship between the company and the worker was following the signing of the contract and to characterise that relationship in its totality. They have not always been astute to distinguish contractual variation from contractual performance. That has been unsurprising given that contractual performance and any contractual variation will have occurred within the same matrix of fact. The distinction, moreover, has not always been seen to have mattered, since the terms of the contract as varied and the manner of its performance have both been understood to have borne on the ultimate question of characterisation. That has been so whether the ultimate question of characterisation has been framed more in terms of whether the worker was supplying subordinated labour under the control of the company or more in terms of whether the worker was carrying on his or her own business. Yellow Cabs of Australia Ltd v Colgan101 provides an early instructive example. There a taxi company was found by a majority of the New South Wales Industrial Commission (Street and Cantor JJ, Piddington J dissenting) to have been successful in turning its previously employed workforce of taxi drivers into independent contractors by getting them to enter into "leases" in relation to its 100 [2022] HCA 1. 101 [1930] AR (NSW) 137. taxis, which they then drove according to the company's rules. Street and Cantor JJ said102: "[I]n all arrangements where the parties occupy a relationship in the nature of that of joint adventurers, there is necessarily involved a certain degree of direction and control arising out of the nature of the relationship created by the agreement itself. But this does not necessarily create the relationship of employer and employee, that question, all the surrounding circumstances having been taken into consideration, being mainly determined by the degree and extent of the detailed control vested in one party over the acts of the other party in the actual execution of the work contemplated in the joint venture." After referring to the terms of the "leases" and associated contractual documents, and to the work practices in place prior to the "lease" arrangements, their Honours continued103: "Under the new system the drivers kept the cab at the company's garage or not, according to their own convenience, and they worked whatever days or hours they liked without control by the company. They were not bound to start from or finish at the company's garage, nor were they required to record their time on the bundy clock. They were not compelled to furnish any record of their hours, nor to work from any specified rank or under any orders as to the place or direction in which they should cruise for work. They paid for their own petrol and they were liable to repay to the company the cost of repairing any damage to the cab or its equipment." In concluding that the previous relationship of employment had not been maintained under the new system, their Honours said104: "Such a system does not appear to establish that the drivers were subject to the commands of the company as to the manner in which they shall do their work, but were independent in that, though they embarked upon the carrying out of a joint enterprise, each driver was substantially in the position of an independent contractor 'who undertakes to produce a given result, but so that in the actual execution of the work he is not under 102 [1930] AR (NSW) 137 at 163 (emphasis added). 103 [1930] AR (NSW) 137 at 165. 104 [1930] AR (NSW) 137 at 169, quoting Performing Right Society Ltd v Mitchell and Booker (Palais de Danse) Ltd [1924] 1 KB 762 at 768. the order or control of the person for whom he does it, and may use his own discretion in things not specified beforehand.'" In Cam and Sons Pty Ltd v Sargent105, Evatt J referred to Yellow Cabs as containing a discussion of the principles applicable to determining the issue in that case, which was whether a shipping company had succeeded by entering into a written agreement in turning the master and crew of one of its ships into a partnership chartering the ship. Proceeding on the understanding that "the relationship between the parties [was] to be determined by a careful consideration of the terms of the agreement made between them and their conduct whilst it was in force"106, Judge Markell had determined at first instance that the relationship between the shipping company and the master and crew during the period in which the written agreement was in force was "in fact" that of employer and employee. The Full Court of this Court (Rich, Dixon, Evatt and McTiernan JJ) unanimously upheld that result in ex tempore reasons for judgment delivered seriatim. In the language of Dixon J, "the learned judge was perfectly right in treating the substance of the relation of master and servant as subsisting between the parties". His Honour explained107: "In a matter of this sort we are to look at the substance of the transaction and not to treat a written agreement, which is designed to disguise its real nature, as succeeding in doing so if it amounts merely to a cloud of words and, without really altering the substantial relations between the parties, describes them by elaborate provisions expressed in terms appropriate to some other relation." The approach in Yellow Cabs was later reflected, and Yellow Cabs was cited, in the reasoning in R v Foster; Ex parte The Commonwealth Life (Amalgamated) Assurances Ltd108 sufficiently set out in CFMMEU109. There, as noted in CFMMEU, application of that reasoning led to the result that an insurance 105 (1940) 14 ALJ 162; High Court of Australia file (proceeding No 7 of 1940). 106 Sargent v Cam & Sons Pty Ltd (unreported, District Court of the Metropolitan District Holden at Sydney, 20 March 1940). 107 Oral reasons of Dixon J, High Court of Australia file (proceeding No 7 of 1940). 108 (1952) 85 CLR 138. 109 [2022] HCA 1 at [134]. company was not shown on the evidence to have been successful in making its insurance salesmen independent contractors. Here, the primary judge (Thawley J) and the Full Court of the Federal Court (Perram, Wigney and Anderson JJ) took essentially the same approach to the resolution of the ultimate question of whether Mr Jamsek and Mr Whitby remained employees of the company after each signed the 1986 contract. They were correct to do so. Subject to one qualification, we see nothing wrong with the Full Court's identification of the applicable common law principles. The one qualification concerns the Full Court's apparent preparedness to contemplate that two persons who have contracted with each other might simultaneously be an employer and an employee and a hirer and an independent contractor110. If the contemplation was no more than that a contract under which a relationship of employment is established and maintained need not be a contract that deals solely with the subject- matter of employment or that admits of performance solely through the establishment and maintenance of a relationship of employment, the contemplation would have been wholly orthodox. If the contemplation was that a single relationship established and maintained under a contract could be simultaneously a relationship of employer and employee and of hirer and independent contractor, the contemplation would have been heterodox. For the purposes of determining who is an "employee" at common law, the distinction between an employee and an independent contractor is and has always been a true dichotomy. Our disagreement is with the evaluative conclusion reached by the Full Court. Against the background of the facts set out by Kiefel CJ, Keane and Edelman JJ, and without repetition of the principles we have referred to in CFMMEU, our reasons for disagreement can be expressed briefly and sufficiently with reference to the relationship between Mr Jamsek and the company during the period of the 1993 contract. Implicit in our earlier identification of the ultimate question is that we adopt the abbreviations of Kiefel CJ, Keane and Edelman JJ. Leaving more equivocal indications to one side, two features of the relationship that existed in fact between Mr Jamsek and the company point inexorably to it having been a relationship within which Mr and Mrs Jamsek in partnership provided carriage services to the company using their own truck as 110 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 117-118 [6]-[8], distinct from a relationship within which Mr Jamsek provided personal service to the company as a truck driver. The first is that Mr and Mrs Jamsek were obliged to, and did, maintain the truck which was used to perform the 1993 contract. A relationship of employment is a relationship of personal service. Personal service is not inherently inconsistent with the individual who provides service being responsible for the physical means by which his or her service is provided111. Bicycle couriers were found to be employees in Hollis v Vabu Pty Ltd112 despite having used their own bicycles, just as Mr McCourt has been found to be an employee in CFMMEU despite having purchased and presumably used his own hard hat. But acceptance by the plurality in Hollis113 that motor vehicle couriers and motorbike couriers in contractual arrangements similar to the bicycle couriers might not have been employees shows that questions of scale can be important and even decisive114. Where work contracted for, actually performed by an individual, and paid for, involves use of a substantial item of mechanical equipment for which the provider of the work is wholly responsible, the personal is overshadowed by the mechanical. That was recognised by this Court in Humberstone v Northern Timber Mills115 and again in Wright v Attorney-General for the State of Tasmania116. Those cases were cited as authorities for that proposition in Neale v Atlas Products (Vic) Pty Ltd117; they support what has become the "conventional view" that "owners of expensive equipment, such as [a truck], are independent contractors"118. The second important feature of the relationship is that it was Mr and Mrs Jamsek in partnership who contracted for the doing of the work involving the use of the truck, and who were therefore jointly and severally liable to the company for the performance of the 1993 contract and jointly and severally entitled to be 111 Neale v Atlas Products (Vic) Pty Ltd (1955) 94 CLR 419 at 425. 112 (2001) 207 CLR 21 at 41-42 [47], 44 [56]. 113 (2001) 207 CLR 21 at 31-32 [22], distinguishing Vabu Pty Ltd v Federal Commissioner of Taxation (1996) 33 ATR 537. 114 ACE Insurance Ltd v Trifunovski (2013) 209 FCR 146 at 171 [95]. 115 (1949) 79 CLR 389. 116 (1954) 94 CLR 409. 117 (1955) 94 CLR 419 at 426. 118 Jamsek v ZG Operations Australia Pty Ltd (2020) 279 FCR 114 at 153 [205]. paid by the company when performance in fact occurred. They together invoiced the company as partners and were together paid by the company as partners. No doubt in recognition of those difficulties, the argument for Mr Jamsek on the appeal involved an attempt to deconstruct and reconstruct the relationship under the 1993 contract, portraying it both as one within which Mr and Mrs Jamsek in partnership were obliged to and did provide the truck and were responsible for invoicing and receiving payment and as one within which Mr Jamsek alone was obliged to and did do the driving. Whilst there is no reason in principle why their relationships could not have been structured and performed that way, that is not what was contracted for and that is not what happened in practice. Mr Jamsek usually drove the truck, but he was not contractually obliged to do so, and on occasions he did not. Mr Jamsek did no substantial work in the performance of the contract other than to load, unload and drive the truck for the purpose of carrying the company's goods. When he did that work in the performance of the contract, the partnership invoiced and was paid for the carriage of goods he provided using the truck. What was contracted for, provided, and paid for, under the contract was the carriage of goods by means of a truck, not the truck and separately Mr Jamsek as an individual to drive it. We agree with the orders proposed by Kiefel CJ, Keane and Edelman JJ, including the order remitting the issues raised by the notice of cross-appeal to the Full Court for determination. GordonJ GORDON AND STEWARD JJ. The central question is whether Mr Jamsek and Mr Whitby were "employed, or usually employed" by a "national system employer" so as to be "national system employee[s]" for the purposes of ss 13 and 14 of the Fair Work Act 2009 (Cth). The answer to this question is determinative of claims brought by Mr Jamsek and Mr Whitby for contraventions by one of the appellants or their predecessors ("ZG") of ss 44, 45 and 357 of the Fair Work Act119. Other questions were raised in this appeal, namely: (2) for the purposes of the definition of "[w]orker" in s 3(1) of the Long Service Leave Act 1955 (NSW), whether Mr Jamsek and Mr Whitby were "employed, whether on salary or wages or piecework rates" by ZG (so as to enliven an entitlement to long service leave and payment for untaken long service leave120); and (3) for the purposes of s 12(1) and (3) of the Superannuation Guarantee (Administration) Act 1992 (Cth), whether Mr Jamsek and Mr Whitby were employees of ZG, including on the basis that they worked under a contract that was wholly or principally for their labour (so as to create the possibility of a superannuation guarantee shortfall121). It was common ground that the second question was resolved by the answer to the central question. One aspect of the third question was in a different category. The parties accepted that even if Mr Jamsek and Mr Whitby were not employees of ZG (and they were not), the separate question of whether for the purposes of s 12(3) of the Superannuation Guarantee (Administration) Act they worked under a contract that was wholly or principally for their labour should be remitted to be determined according to law. It is a separate question about, and requires separate characterisation of, the contracts. The principles we consider should be applied and the approach to be adopted in deciding whether the totality of a relationship between two parties is one of employer and employee are set out in Gordon J's reasons for judgment in Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd122 ("CFMMEU"). The claims made by Mr Jamsek and Mr Whitby related to periods when the identity of the putative employer – the company that owned the business – changed. No party submitted that this affected the answer to the question whether 119 Fair Work Act, ss 42, 335, 339(a)-(b). 120 Long Service Leave Act, s 4(1) and (5). 121 Superannuation Guarantee (Administration) Act, ss 19(1), 33, 46. 122 [2022] HCA 1. GordonJ the relationships between Mr Jamsek and Mr Whitby and ZG were relationships of employer and employee. It is therefore not necessary to differentiate between the two appellants or to differentiate between the two appellants and their predecessors. It is for this reason that the putative employer is referred to as "ZG". And, further, no party suggested that the various contracts which were in place during the claim period resulted in a different characterisation of the totality of the parties' relationships. It is therefore sufficient to primarily refer to two of the contracts – the 1986 Contract and the 1993 Contract. The relevant facts may be stated simply. Mr Jamsek and Mr Whitby were each employed by ZG from 1977 until late 1985 or early 1986. For the latter part of that period, each was employed to drive ZG's trucks. In late 1985, ZG told Mr Jamsek and Mr Whitby (and the other drivers employed by ZG) that if they did not agree to become contractors and provide their own trucks, ZG could not guarantee them a job going forward. Mr Jamsek and Mr Whitby (and the other drivers) accepted ZG's offer. In 1986, the Jamsek Partnership (comprised of Mr Jamsek and his wife, established in late 1985 or early 1986) and the Whitby Partnership (comprised of Mr Whitby and his wife, established in late 1985 or early 1986) each entered into a written contract with ZG ("the 1986 Contract"). Under the 1986 Contract, each partnership provided a truck and contracted to deliver goods for ZG for which the partnership was entitled to be paid a minimum "per carton" rate of $120 per day or $600 per week. A copy of the 1986 Contract could not be located and was not in evidence. In July 1993, each partnership and ZG executed a written "Contract Carriers Arrangement" ("the 1993 Contract"). The parties to the 1993 Contract again included each of the partnerships, identified as "Contractors", and ZG. Senior counsel for Mr Jamsek and Mr Whitby submitted that each contract, or "instrument", constituted a multiplicity of contracts, including contracts "between [ZG] and several partnerships", contracts "between the partnerships" and contracts "involv[ing] rights which [were] particular to the male members of those partnerships". But then junior counsel for Mr Jamsek and Mr Whitby submitted that "a partnership is not a separate legal entity" and so the contract was directly with Mr Jamsek and Mr Whitby. The identity of the contracting parties was not in dispute. The 1993 Contract was a contract between the partnerships and the other drivers (referred to as "Contractors") and ZG. The nature of the contracting parties123 and the context 123 CFMMEU [2022] HCA 1 at [174], citing Australian Mutual Provident Society v Chaplin (1978) 52 ALJR 407 at 410; 18 ALR 385 at 391 and Hollis v Vabu Pty Ltd (2001) 207 CLR 21 at 48-49 [68]. GordonJ in which the contract was entered into assists to identify the purpose or object of the contract124. As we have seen, the partnerships were established in late 1985 or early 1986, contemporaneously with Mr Jamsek and Mr Whitby being offered, on a take it or leave it basis, the opportunity to "become contractors" with ZG and to "[u]ndertake carriage of goods as reasonably directed"125 by ZG, and that offer being taken up. A partnership, being the relation which exists between persons carrying on their own business with a view of profit126, cannot, with respect to the activities of the partnership, be contracted to work in another's business or enterprise. The relationships created by the 1993 Contract between each partnership and ZG were not ones of employer and employee. Under the 1993 Contract, the partnerships were required to supply a vehicle of a particular kind if the partnership was to "[u]ndertake carriage of goods as reasonably directed"127 under that contract128. The pay rates under the 1993 Contract were set by reference to the partnerships supplying vehicles of a particular kind – "trucks over one year old with a carrying capacity of not less than 5 tonnes but less than 8 tonnes"129. Under the 1993 Contract, each partnership's obligations in relation to the truck it supplied included: to pay all legal costs, such as tax and duty, in relation to the vehicle and keep the vehicle mechanically sound, road worthy and clean (cl 2.1(c)); 124 CFMMEU [2022] HCA 1 at [175], citing, among other cases, Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 CLR 337 at 350, 352 and Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104 at 117 125 1993 Contract, cl 2.1(a). 126 Partnership Act 1892 (NSW), s 1(1); Partnership Act 1958 (Vic), s 5(1); Partnership Act 1891 (SA), s 1(1); Partnership Act 1891 (Qld), s 5(1); Partnership Act 1895 (WA), s 7(1); Partnership Act 1891 (Tas), s 6(1); Partnership Act 1997 (NT), s 5(1); Partnership Act 1963 (ACT), s 6(1). 127 1993 Contract, cl 2.1(a). 128 1993 Contract, cll 2.1(c), 2.1(i), 7(a). 129 1993 Contract, cl 7(a). GordonJ to obtain and maintain a public liability insurance policy for an amount of $2,000,000 or greater in respect of any liability incurred by the partnership in performing work for ZG (cl 2.1(h)); and to obtain and maintain a comprehensive motor insurance policy over the vehicle for an amount of $5,000,000 or greater for third party property damage in respect of one accident (cl 2.1(i)). Consistent with those contractual obligations, each partnership also agreed "[n]ot [to] offer [its] vehicle for sale with any guarantee of either continuity of the purchaser"130. work for [ZG], or The significance of the supply of the vehicle by each partnership under the contract was reinforced by cl 5(e), which provided that sale of "the vehicle" for any reason other than replacement "automatically terminate[d] [the 1993 Contract] ... unless specifically, and in writing, agreed otherwise with the NSW Branch Manager". implied acceptance by [ZG] of Next, cl 1(b) provided that the partnerships were "[a]ble to work for other parties, providing that such work [was] not detrimental to either [ZG] or [ZG's] customers" and cl 2.1(g) provided that the partnerships agreed to "[n]ot engage or use the services of a driver for the vehicle without prior and continuing approval by [ZG]". This made explicit that the partnerships were not tied to ZG and that performance of the contractual obligations was not personal to Mr Jamsek and Mr Whitby131. The work – carriage of goods – and the payment for that work do not suggest relationships of employer and employee. Under cl 1(c) of the 1993 Contract, the partnerships were to invoice ZG for the work carried out in the preceding week. Under the 1993 Contract, the pay rates changed. Under cl 7(a), the partnerships were entitled to invoice ZG on an hourly rate, rather than on a "per carton" basis. The work the partnerships were contracted to carry out under the contract – carriage of goods – was as reasonably directed by ZG132. Much was made of this clause by senior counsel for Mr Jamsek and Mr Whitby, who suggested that it was "the most complete example of control one can conceive of". While cl 2.1(a) did confer control on ZG, it was control of a particular kind: a power to give directions to make deliveries rather than to direct how that should be done. Put in different 130 1993 Contract, cl 2.1(k). 131 See CFMMEU [2022] HCA 1 at [198], citing Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16 at 24, 36-37. 132 1993 Contract, cl 2.1(a). GordonJ terms, ZG engaged the partnerships to carry its goods to its customers; not to carry goods absent a specified destination. There are clauses in the 1993 Contract that may suggest relationships of employer and employee. For example, cl 7(b) provided that the parties had "agreed to a standard nine hour working day with a usual starting time of 6 am, both parties accepting that the actual hours may vary due to work load fluctuations". While this may tend slightly in favour of relationships of employer and employee, it should be viewed in the context of cl 9(a), which provided that "[ZG] [would] where ever possible, offer any extra work to the [partnerships] at a mutually agreed rate for each job". This suggests that while the parties agreed on a nine-hour working day as a starting point, there was flexibility built into the contract for the remuneration to increase as extra work was undertaken133. Assessing the totality of the relationships between the partnerships and ZG as set out in the 1993 Contract, Mr Jamsek and Mr Whitby were not employed by ZG. The partnerships, not Mr Jamsek and Mr Whitby, were the contracting parties. The partnerships each contracted to provide, to operate and to maintain a truck to carry ZG's goods to its customers. The partnerships were entitled to invoice ZG for carrying the goods that they carried. It is true that the 1993 Contract between the partnerships and ZG addressed the obligations of the partnerships providing drivers. But that is to be expected. A truck could not in 1986 or 1993 carry and deliver goods without a driver. In 2012, the Whitby Partnership was dissolved after the dissolution of Mr Whitby's marriage. The evidence at trial was that Mr Whitby alone continued to provide, to operate and to maintain a truck to carry ZG's goods to its customers and, in return, Mr Whitby for himself (not on behalf of the Whitby Partnership) invoiced ZG for carrying the goods that he carried. That evidence was admissible to establish discharge of what had by that time become the contract terms pursuant to the "Contract Carriers Agreement Rate Review – 23rd May 2008" ("the 2008 Contract")134 and the making of a new contract between Mr Whitby alone and ZG on terms identical to the 2008 Contract. The totality of that relationship was not that of employer and employee. 133 CFMMEU [2022] HCA 1 at [174], citing Stevens (1986) 160 CLR 16 at 24. 134 It was common ground that, but for the substitution of Mr Whitby for the Whitby Partnership and the change of pay rates, there were no material changes between the 1993 Contract, the 1998 Contract, the 2001 Contract and the 2008 Contract. GordonJ Consistent with the principles set out in CFMMEU135, it was both relevant and admissible to adduce evidence to establish, in the case of the Whitby Partnership and Mr Whitby, that the 2008 Contract was discharged, that a new contract was formed and what the terms of that contract were. By contrast, however, how the parties exercised their rights, performed their duties or unilaterally conducted themselves, whether at the time of a change in ownership of the business, the time of the dissolution of the Whitby Partnership or any other time during the period of the claim, was not relevant136. Throughout the claim period, there were changes to the pay rates which were agreed between ZG and the partnerships. It was both relevant and admissible to adduce evidence to establish that an increase in pay rates was agreed and the terms of that agreement137. So, for example, evidence was adduced that in 1998 Mr Whitby approached the New South Wales State Manager of ZG to seek an increase in the pay rates from those set out in the 1993 Contract and that an increase was agreed which was then set out in the 1998 Contract. Evidence was adduced that similar requests were made in 2001 and 2008 and increased rates were agreed. We agree with the orders proposed by Kiefel CJ, Keane and Edelman JJ. 135 See CFMMEU [2022] HCA 1 at [177], [183], [188], citing, among other cases, Tallerman & Co Pty Ltd v Nathan's Merchandise (Victoria) Pty Ltd (1957) 98 CLR 93 at 112-113, Byrne v Australian Airlines Ltd (1995) 185 CLR 410 at 442, Brambles Holdings Ltd v Bathurst City Council (2001) 53 NSWLR 153 at 163-164 [25], ALH Group Property Holdings Pty Ltd v Chief Commissioner of State Revenue (NSW) (2012) 245 CLR 338 at 350-351 [31]-[32] and Chitty on Contracts, 33rd ed (2018), vol 1 at 1087 [13-124]. 136 CFMMEU [2022] HCA 1 at [176], citing Agricultural and Rural Finance Pty Ltd v Gardiner (2008) 238 CLR 570 at 582 [35], James Miller & Partners Ltd v Whitworth Street Estates (Manchester) Ltd [1970] AC 583 at 603 and Administration of Papua and New Guinea v Daera Guba (1973) 130 CLR 353 at 137 CFMMEU [2022] HCA 1 at [177], [183], [188], citing Phillips v Ellinson Brothers Pty Ltd (1941) 65 CLR 221 at 243-244, Tallerman (1957) 98 CLR 93 at 112-113 and Chaplin (1978) 52 ALJR 407 at 411; 18 ALR 385 at 392-393.

HIGH COURT OF AUSTRALIA MINISTER ADMINISTERING THE CROWN LANDS ACT APPELLANT AND NSW ABORIGINAL LAND COUNCIL RESPONDENT Minister Administering the Crown Lands Act v NSW Aboriginal Land Council [2008] HCA 48 2 October 2008 Appeal dismissed with costs. ORDER On appeal from the Supreme Court of New South Wales Representation M J Leeming SC with J A Waters for the appellant (instructed by Crown Solicitor (NSW)) J T Gleeson SC with M L Wright for the respondent (instructed by Chalk & Fitzgerald) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Minister Administering the Crown Lands Act v NSW Aboriginal Land Council Aboriginals – Land rights – Whether land "claimable Crown land" under s 36(1) of Aboriginal Land Rights Act 1983 (NSW) ("Land Rights Act") – Whether land "lawfully used or occupied" under s 36(1)(b) of Land Rights Act – Whether steps taken preparatory to intended sale of land constituted lawful use and occupation of land. Statutes – Construction – Meaning of "lawfully used or occupied" – Whether "lawfully used or occupied" is compound expression with single meaning – Whether "used" and "occupied" to be considered separately – Meaning of "use" – Meaning of "occupied". Statutes – Construction – Meaning of "lawfully used or occupied" – Whether Land Rights Act to be interpreted beneficially and remedially – Whether reliance on beneficial and remedial purpose of Land Rights Act necessary and useful to resolve contested question of interpretation of Land Rights Act. Words and phrases – "claimable Crown lands", "lawfully used or occupied", "use", "occupied". Aboriginal Land Rights Act 1983 (NSW), s 36(1)(b). KIRBY J. The interpretation of legislation is one of the most important functions of Australian courts. A significant change in this area is the move away from the notion that language has clear and incontestable meanings that are ascertainable from a close study of the words alone. This "literal" or "grammatical" approach to interpreting statutory texts has gradually given way to an appreciation that legal interpretation is a more complex task. Whilst the starting point in interpretation must still always be the text1, it is now appreciated that context and purpose are also vitally important. Further, this approach is not limited to cases where the text appears on its face to be ambiguous2. A sub-species of this context and purpose rule is a principle of interpretation that arises where a contested text appears in a statute that has an apparently beneficial or remedial purpose. Where different literal interpretations of such a text appear to be available to the decision-maker, it is valid, and sometimes helpful, to identify the beneficial or remedial purpose discerned. The decision-maker should then endeavour (so far as the text allows) to adopt a construction that advances that purpose in preference to one that would frustrate or diminish the attainment of the apparently intended benefits and reforms. This beneficial or remedial reading principle is by no means new. It simply re-expresses, in the current age of enlarged legislation, a very old canon of interpretation that enjoins decision-makers to address the "mischief" perceived in the legislation3. This is in contrast to upholding an interpretation that results in the legislation misfiring and missing its obviously intended mark4. 1 Re Bolton; Ex parte Beane (1987) 162 CLR 514 at 518; [1987] HCA 12; Trust Company of Australia Ltd v Commissioner of State Revenue (2003) 77 ALJR 1019 at 1029 [68]; 197 ALR 297 at 310; [2003] HCA 23. 2 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 381-382 [69]-[70]; [1998] HCA 28; Boral Besser Masonry Ltd v Australian Competition and Consumer Commission (2003) 215 CLR 374 at 498 [383]; [2003] HCA 5. cf Inland Revenue Commissioners v Ayrshire Employers Mutual Insurance Association Ltd [1946] 1 All ER 637 at 641; Kingston v Keprose Pty Ltd (1987) 11 NSWLR 404 at 424 per McHugh JA. 4 The rule in Heydon's Case (1584) 3 Co Rep 7a at 7b [76 ER 637 at 638]. See eg North Ganalanja Aboriginal Corporation v Queensland (1996) 185 CLR 595 at 614-615; [1996] HCA 2; James Hardie & Coy Pty Ltd v Seltsam Pty Ltd (1998) 196 CLR 53 at 81 [72]; [1998] HCA 78. Kirby I agree with most of the reasons of Hayne, Heydon, Crennan and Kiefel JJ ("the joint reasons"). Certainly, I agree with the ultimate conclusions stated there and with the order proposed5. The joint reasons acknowledge (as did Mason P in the decision below in the Court of Appeal of New South Wales)6 that the legislation in question was designed to be beneficial and remedial. However, the joint reasons state that "[i]t is not necessary to invoke some principle of 'beneficial construction' to resolve the issue in this case"7. Moreover, the joint reasons also state that "[n]o question is presented … which requires a choice to be made between competing constructions of s 36(1)(b) [of the Aboriginal Land Rights Act 1983 (NSW) ('the Land Rights Act')], one described as 'broad' and the other as 'narrow'"8. For the joint reasons, the contested statutory question is only whether the official activities cited by the Minister for Lands (NSW) ("the Minister") constituted a lawful "use" of the land (or "use or occupation") at the time the New South Wales Aboriginal Land Council ("the Land Council") made its claim upon the land. Not for the first time9, with respect, I see in this approach hints of a return to the literal interpretation of legislation which this Court has (in my view rightly) earlier discarded. It is as if words, without more, will yield the answer to a problem of statutory interpretation presented by a case such as the present. I would resist any return to that earlier narrowing of the judicial focus. Consequently, I am bound to explain why the beneficial and remedial character and purpose of the Land Rights Act is an important ingredient in the reasoning that I would adopt to reject the arguments of the Minister before this Court and to sustain the decision and orders of the Court of Appeal. Without this ingredient, I am not convinced that I would reach the same conclusion. The basis for my doubt is that the critical word "use", in relation to land, is inherently unclear in its meaning. It is ambiguous and could potentially yield contradictory results. In resolving which result should be preferred by a Joint reasons at [78]. Joint reasons at [47], citing Mason P in the Court of Appeal: NSW Aboriginal Land Council v Minister Administering Crown Lands Act (2007) 157 LGERA 18 at Joint reasons at [48]. Joint reasons at [48]. 9 See eg Foots v Southern Cross Mine Management Pty Ltd (2007) 82 ALJR 173 at 194 [95]; 241 ALR 32 at 56; [2007] HCA 56. Kirby court, the accepted beneficial and remedial characterisation of the Land Rights Act is, for me, a significant factor in the decision-making process. This Court has repeatedly admonished decision-makers in other courts (and this is now reflected in general legal and administrative practice) to look beyond the words of the text and to consider the statutory and social context so as to understand those words more clearly10. Giving weight to the beneficial and remedial purposes of the Land Rights Act is part of that operation. Only this approach will give effect, in such a context, to the beneficial and remedial purposes of Parliament in preference to a view of the text that might tend to frustrate, narrow or limit the attainment of such purposes. It is important for this Court to expose and apply the principles of statutory interpretation consistently in a case such as the present. That is the explanation for my separate reasons, notwithstanding that I reach the same result as the joint reasons. A court must be consistent in what it says and does in its approach to interpretation (whether of the Constitution, or of a statute, contract, or other document11). Otherwise, the court will expose itself to criticism that its inconsistent approaches produce inconsistent outcomes. Concerns will then be expressed that judicial dispositions represent little more than intuitive opinions of judges based on a reading of words in contested texts as viewed through their own narrow verbal lens. The search for consistent approaches to statutory interpretation is part of an endeavour by the courts to introduce elements of the rule of law into this most common and important contemporary judicial function. To encourage that endeavour is a proper objective of a court such as this Court. Some common approaches Facts, legislation and proceedings: The relevant facts12, the applicable provisions of the Land Rights Act13 and the decisional history14 of this appeal are stated in the joint reasons. Similarly, the joint reasons briefly describe the precursors to the Act, namely the report that recommended "land rights for New 10 See, for example, CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408; [1997] HCA 2; Coleman v Power (2004) 220 CLR 1 at 21 [3]; [2004] HCA 39; R v Lavender (2005) 222 CLR 67 at 81 [33]; [2005] HCA 37. 11 See Kirby, "Towards a Grand Theory of Interpretation: The Case of Statutes and Contracts", (2003) 24 Statute Law Review 95. 12 Joint reasons at [50]-[59]. 13 Joint reasons at [42]-[43], [46]. 14 Joint reasons at [60]-[64]. Kirby South Wales Aboriginal citizens"15. The preamble to the Land Rights Act16 expresses, in general terms, the beneficial and remedial objects of the New South Wales Parliament in enacting that Act. Against the background of prolonged, deep-seated, reinforced and, ultimately, widely accepted discrimination in the law against the rights to traditional lands of the indigenous people of Australia17, the objects evident in the Land Rights Act could fairly be described as little short of revolutionary. The discriminatory common law principle that lay at the source of the denial to indigenous people in Australia of rights to land existed despite the fact that such recognition was accorded to the land rights of the settlers and their successors. There was a further fundamental correction to this principle some years after the Land Rights Act was adopted, notably in the decisions of this Court in Mabo v Queensland [No 2]18 and Wik Peoples v Queensland19. However, the contextual consideration of these decisions does not, in any way, diminish the important shift in direction in the law of New South Wales achieved by the enactment of the Land Rights Act20. Advances in interpretive techniques: I could not agree with any needless reversion to literal techniques of statutory interpretation. Any attempt to understand, and give effect to, the language and purpose of the Land Rights Act without placing that statute in its historical, legal, social and human rights context risks such a reversion. Formally, the reason that I could not agree is the repeated authority of this Court to the contrary effect. But an additional reason is the fact that the decisional authority is ultimately based upon a more accurate consideration of the way human beings understand communication as expressed through language. Human beings gain understanding not only by reference to the words used in the communication but also through other essential indicators, relevantly of context and purpose, and in particular any intended beneficial or remedial purpose. 15 Joint reasons at [45]. 16 See joint reasons at [46]-[47]. 17 See Northern Territory v Arnhem Land Aboriginal Land Trust (2008) 82 ALJR 1099 at 1114-1115 [70]; [2008] HCA 29. 18 (1992) 175 CLR 1; [1992] HCA 23. 19 (1996) 187 CLR 1; [1996] HCA 40. 20 See the ministerial speech by Mr Walker, Minister for Aboriginal Affairs, in support of the Bill for the Land Rights Act: New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 24 March 1983 at 5088-5097. Kirby The interpretation of the meaning of words in written texts is not (nor can it be reduced to) a purely mechanical process21. There have been attempts to introduce consistency through common approaches and accepted or enacted canons of construction. However, as recently expressed by this Court, it is not unusual for such principles and canons to "jostle" for acceptance in a given The changes to the pre-existing law introduced by the Land Rights Act are significant and historic. To ignore the beneficial and remedial character of the legislation, or to treat it as immaterial to the present function of interpretation, would risk misunderstanding or narrowing the words used in the statutory text. Effectively, it would read the words once again (as our forebears were wont to do) divorced from their context and apparent purposes. We should not make that mistake. A review of two decades of decisions by New South Wales courts following the enactment of the Land Rights Act discloses that such courts, and particularly the Court of Appeal, have not made that error. With a very high measure of consistency, those courts have evidenced a consciousness of the history that preceded the Land Rights Act and the high objects apparent in the decision to enact it. Indeed, the Court of Appeal has elaborated and explained the meaning of lands "not lawfully used or occupied"23 on a number of occasions. That Court has done so by referring to the necessity to read the text of the Land Rights Act, as far as the language permits, in such a way as to advance, and not to frustrate, the attainment of the beneficial and remedial objectives that lay at the heart of Parliament's imputed intention. Beneficial and remedial interpretation: After the enactment of the Land Rights Act, the Court of Appeal considered the matter in Minister for Natural Resources v New South Wales Aboriginal Land Council24 ("the Tredega Claim case"). In my reasons in that decision, in words that have been quoted and applied many times since, I observed: 21 cf Sons of Gwalia Ltd v Margaretic (2007) 231 CLR 160 at 209 [116]; [2007] HCA 1; Forsyth v Deputy Commissioner of Taxation (2007) 231 CLR 531 at 549-550 [48]; [2007] HCA 8. 22 See Gedeon v Commissioner of the New South Wales Crime Commission [2008] HCA 43 at [51]. 23 Land Rights Act, s 36(1)(b). 24 (1987) 9 NSWLR 154 at 157. Kirby "Clearly, [the Land Rights Act] was enacted to give important rights in Crown land to the representatives of the Aboriginal people. … Against such a background, and given its purposes and context with other land rights and similar remedial legislation, the [Land Rights Act] should be given by the courts the most beneficial operation compatible with its language." This principle of construction has been given effect in many decisions of the Court of Appeal and the Land and Environment Court of New South Wales25. It is undesirable for this Court now to endorse a different approach. After all, the principle in analogous circumstances involving quite different legislation26. It should not be disclaimed in this instance even though the correct outcome can still be reached. If it is disclaimed here, a failure to consider it in the next case may yield a different, and erroneous, outcome. is perfectly orthodox. is regularly applied I adhere in this Court to what I said in the Tredega Claim case. Rightly, in my view, Spigelman CJ observed in Minister Administering the Crown Lands Act v Deerubbin Local Aboriginal Land Council [No 2]27 that the principle mandating a beneficial and remedial interpretation of the Land Rights Act requires that exceptions to the right to claim land under that Act should be construed narrowly. The same principle necessarily applies to the interpretation of disqualifications from entitlements under the Land Rights Act. Furthermore, in interpreting legislation that has a substantive impact upon Aboriginal rights, enjoyed by statute or by the common law, any ambiguity should be resolved in a way that is favourable to the rights of Aboriginal 25 New South Wales Aboriginal Land Council v Minister Administering the Crown Lands (Consolidation) Act and the Western Lands Act (The Winbar Claim [No 2]) (1988) 64 LGRA 240 at 244; Darkingung Local Aboriginal Land Council v Minister Administering the Crown Lands (Consolidation) Act (1988) 65 LGRA 96 at 101; Tweed Byron Local Aboriginal Land Council v Minister Administering the Crown Lands (Consolidation) Act (1990) 72 LGRA 177 at 180-181; New South Wales Aboriginal Land Council v Minister Administering the Crown Lands Act (The Department of Education Claim) (1992) 76 LGRA 192 at 195; cf R v Kearney; Ex parte Jurlama (1984) 158 CLR 426 at 433; [1984] HCA 14. 26 See eg Patton v Buchanan Borehole Collieries Pty Ltd (1993) 178 CLR 14 at 17 (which considered the District Court Act 1973 (NSW), s 79A); [1993] HCA 23; Newcastle City Council v GIO General Ltd (1997) 191 CLR 85 at 101-102 per Toohey, Gaudron and Gummow JJ (which considered the Insurance Contracts Act 1984 (Cth), s 40); [1997] HCA 53. 27 (2001) 50 NSWLR 665 at 674 [53]-[54]. See (2007) 157 LGERA 18 at 24 [21]. Kirby peoples28. Any attempt by Parliament to restrict those rights must be clear and plain29. If courts in other common law countries, with relevantly similar histories post-settlement, adopt this approach there is no reason why this Court, following Mabo30 and Wik31, should not do so. Indeed, given the more significant history of dispossession in Australia, now reaffirmed32, there is every reason why it should. To treat the language of the Land Rights Act as if it were purely machinery or technical law, devoid of significant historical and social objectives, would betray a serious legal error33. It was not an error made by the Court of Appeal or by the primary judge. We also should not make such an error. Concurrence with joint reasons: I can, however, still endorse most of the reasons of my colleagues. Thus, I concur that: Considering the proper disposition on the substance of the appeal, it is neither necessary nor appropriate for this Court to determine the motion filed by the Land Council that the special leave earlier granted should be revoked because the Minister had attempted to shift his ground by raising fresh arguments in the appeal34; 28 Griffiths v Minister for Lands, Planning and Environment (2008) 82 ALJR 899 at 919-920 [108]; 246 ALR 218 at 241; [2008] HCA 20; R v Van der Peet [1996] 2 SCR 507 at 536 [23] per Lamer CJ ("generous and liberal"), 592 [154] per L'Heureux-Dubé J ("generous, large and liberal"). 29 Griffiths (2008) 82 ALJR 899 at 919 [107], 920 [110]; 246 ALR 218 at 241-242; Northern Territory v Arnhem Land Aboriginal Land Trust (2008) 82 ALJR 1099 at 1113-1114 [67]; United States v Dion 476 US 734 at 738-739 (1986); Van der Peet [1996] 2 SCR 507 at 652 [286] per McLachlin J. 30 (1992) 175 CLR 1. 31 (1996) 187 CLR 1. 32 See Northern Territory v Arnhem Land Aboriginal Land Trust (2008) 82 ALJR 1099 at 1114-1115 [70]-[72] (referring to the National Apology). 33 cf Griffiths (2008) 82 ALJR 899 at 919 [105]; 246 ALR 218 at 240; Northern Territory v Arnhem Land Aboriginal Land Trust (2008) 82 ALJR 1099 at 34 Joint reasons at [66]. Kirby The starting point for resolving the statutory controversy must, as always, be the applicable legislative text35; That text requires, at a minimum, that the decision-maker must examine the critical phrase "not lawfully used". The decision-maker must do this within the larger statutory expression, namely "are not lawfully used or occupied"36. Moreover, that disqualifying phrase must, in turn, be read in the context of the other exceptions to the Crown lands of New South Wales for which a claim might be made under the Land Rights Act; The observations in this case, like the earlier observations in the decisions of the Court of Appeal, are necessarily addressed to the particular facts disclosed by the evidence and findings37. They will not exhaustively define the meaning of the expression "use or occupation" of land – least of all for the rather special context here in question38; and "Use or occupation" of land in the Land Rights Act encompasses notions of "utilisation, exploitation and employment of the land". However, that leaves to be decided the type, degree, duration, object and extent of the "utilisation, exploitation and employment of the land"39. Protean "use" invokes special rule: It is in this respect that the statutory words need to be understood in the special context of the Land Rights Act. That context helps to resolve the problem derived from the inherent ambiguity of the contested statutory expression when applied to the facts of the present case. The joint reasons correctly acknowledge that the word "use" is protean in its content40. Consequently, it cannot really be denied that the resulting statutory phrase, as a whole, is potentially ambiguous. This Court is thus justified in resorting to well-established interpretive tools to resolve the ambiguity. 35 Joint reasons at [68]. 36 Land Rights Act, s 36(1)(b). See joint reasons at [68]. 37 Joint reasons at [69]. 38 cf joint reasons at [69]. 39 Joint reasons at [73]. 40 Joint reasons at [69] citing (2007) 157 LGERA 18 at 25 [32] per Mason P. Kirby The source of the statutory ambiguity Arguable "use" of the land: In the factual context of this appeal, which substantially represented common ground, it is impossible to say that there is no ambiguity in the word "use" in relation to the subject land. Depending upon whether a "broad" or "narrow" approach to the word "use" was adopted, I could not deny that, upon one construction, the conduct of the governmental authority at the time when the claim upon the land was made might conceivably have amounted to a lawful "use" of the land41. Were that so, the land would have fallen within the statutory disqualification from a claim. To say that there was no ambiguity would effectively deny the arguability of the Minister's appeal. That would contradict my impression of the situation. It would also be rather unlikely, given that the Minister was granted special leave to appeal by Gummow and Heydon JJ inferentially because his submissions were reasonably arguable. Disregarding the unpursued or abandoned steps taken earlier by officers of the Department of Lands in relation to the subject Crown land does not end the debate. A number of other preliminary steps were undoubtedly taken which, to a degree, constituted utilisation, exploitation and employment (and thus "use") of the land, viewing the word "use" in an abstract way. Such steps would arguably include: The decision, reduced in December 2004 to a written report with a recommendation, that the subject land be disposed of by sale. The resulting recovery would then be paid into the State Treasury for the general purposes of the State42; The ensuing publication of an advertisement in the local newspaper indicating the departmental intention to revoke the reservation of the land from sale43; and Other activities, such as the initiation of an identification survey; the request to issue the certificate of title; the formal cancellation of the reservation of the land; the engagement of a real estate agent to effect a sale; the inspection of the property by the agent with recommendations anterior to sale; and the consideration of how the land might be physically 41 Under the Land Rights Act, s 36(1)(b). 42 Joint reasons at [53]. 43 Joint reasons at [55]. 44 Joint reasons at [55]-[58]. Kirby Viewing the "use" in context: In other contexts, and for different statutory purposes45, the foregoing acts of dominion over the land might indeed constitute "use" of the land. The word "use" can cover a wide or narrow range of activities. In some contexts, an owner could undeniably assert that a power to sell and the preliminary steps then taken to ready the land for sale might constitute "use" of the land, at least for that limited and terminal purpose. This is why it is essential to understand the contested phrase in the statutory context in which it appears in the Land Rights Act. It must not be considered in isolation, or disjoined, from that context with the important beneficial and remedial purposes of that Act. What was the reason for excluding the three stated categories mentioned in s 36(1) of the Land Rights Act from "claimable Crown lands"46? In the context, the applicable reason was to define those categories of land which, alone of the remaining Crown lands in the State, would be placed beyond the land generally available for a claim under the Land Rights Act. Thus the beneficial and remedial character of the Land Rights Act encourages a narrow or strict interpretation of the exceptions. This feature of the exceptions led the Court of Appeal to introduce the explanation that the "lawful use or occupation" (in s 36(1)(b) of the Land Rights Act) must ordinarily be something "more than notional" so that the land is "actually used". In other words, the land must be used in fact and not merely intended to be used or used to a notional degree47. Resolving the ambiguity: upholding the statutory purpose Requirement of "actual use": The Court of Appeal introduced a requirement for "actual use" and use beyond a "merely notional degree" in 45 Such as, for example, a statute providing for the payment of just terms for the acquisition of land used or occupied by an owner. 46 Section 36(1) of the Land Rights Act has been amended several times to provide further exceptions from the definition of "claimable Crown lands". Most importantly, s 36(1)(b1), as inserted by Aboriginal Land Rights (Amendment) Act 1986 (NSW), Sched 1, item 13, excepts "lands which, in the opinion of a Crown Lands Minister, are needed or are likely to be needed as residential lands". See also Native Title (New South Wales) Act 1994 (NSW), Sched 1, item 3, which inserted s 36(1)(d) and (e). 47 Daruk Local Aboriginal Land Council v Minister Administering the Crown Lands Act (1993) 30 NSWLR 140 at 164; Minister Administering the Crown Lands Act v NSW Aboriginal Land Council (1993) 31 NSWLR 106 at 121. Kirby interpreting the words of the Land Rights Act48. This represented the correct approach. It construes the statutory expression "not lawfully used or occupied" in a way that furthers the beneficial and remedial purposes of the Land Rights Act. It does not frustrate the achievement of those purposes. This approach addresses the physical use of the land rather than a purely notional, potential, contingent or future "use" or a "use" which has not yet been translated into any actual physical use. I therefore agree with Mason P in this analysis49. It is supported by the contextual and purposive construction of the Land Rights Act. Specifically, it is supported by the narrow interpretation of the exceptions in s 36(1) of that Act. Such a narrow interpretation is appropriate in interpreting exceptions to the grant of the beneficial and remedial rights expressed in such a legislative context. In a series of earlier decisions, the Court of Appeal has held that mere proprietorship is insufficient to establish either "use" or "occupation" of the relevant land50. This is consistent with the principle of a beneficial and remedial interpretation of the Act. To be "used", the land must be "actually used" or "used in fact", not merely used in "a nominal sense" or to a "notional degree"51. A contemplated or intended use is not, therefore, a "use" within the meaning of s 36(1)(b)52. Insufficiency of contingent "use": The fact that the "use" or "occupation" must be "actual" rather than "notional" is further supported by the proposition that, in our legal theory, the Crown is the "universal occupant" of land over which sovereignty is asserted53. As Priestley JA pointed out in Daruk Local 48 (2007) 157 LGERA 18 at 25 [33]. 49 (2007) 157 LGERA 18 at 25 [32]-[33]. 50 Minister Administering the Crown Lands (Consolidation) Act v Tweed Byron Local Aboriginal Land Council (1992) 75 LGRA 133 at 140 per Clarke JA (with whom Samuels and Meagher JJA agreed); Daruk (1993) 30 NSWLR 140 at 163 per Priestley JA (with whom Cripps JA agreed, Mahoney JA dissenting). 51 Daruk (1993) 30 NSWLR 140 at 164 per Priestley JA; Minister Administering the Crown Lands Act v NSW Aboriginal Land Council (1993) 31 NSWLR 106 at 108 per Priestley JA, 119 per Sheller JA (with whom Clarke JA agreed). 52 Minister Administering the Crown Lands Act v NSW Aboriginal Land Council (1993) 31 NSWLR 106 at 121 per Sheller JA (Clarke JA agreeing). 53 Attorney-General v Brown (1847) 1 Legge 312 at 316; Mabo v Queensland [No 2] (1992) 175 CLR 1 at 33. Kirby Aboriginal Land Council v Minister Administering the Crown Lands Act54, such a notional or theoretical interpretation of "occupation" could not be accepted as applicable to s 36(1) of the Land Rights Act without effectively excluding all lands from "claimable Crown lands". This is a further indication that the exclusion envisaged by s 36(1)(b) of the Land Rights Act involves something more than notional, theoretical, potential or intended future use or occupation. This view is also reinforced by the purpose the phrase fulfils in the Act. That purpose is to make available a substantial pool of Crown land in the State which is actually unused and unoccupied at the time a claim is made. It is because that land is unused or unoccupied that it is subject to the possibility of a claim, the purpose of which is to redress and repair the acknowledged historical dispossession of land from the State's indigenous peoples. Without an additional ingredient, all Crown land is contingently subject to sale, certainly to long-term plans for sale. If, however contingent, such plans, notions or ideas of sale of such land would remove the land from the pool of "claimable Crown lands", the ambit of available lands would be drastically reduced, certainly in potential. To exclude particular land from the potential of being claimed would merely require postulation by a relevant official of a possible future sale. This would amount to a disqualifying incident of "use" or possibly "occupation". That could not be what this beneficial and remedial legislation intended. The foregoing conclusions oblige a court resolving an issue, such as that raised by this appeal, to look in practical terms at the land in question. Understood against the historical background and with a view to achieving the beneficial and remedial objectives of the Land Rights Act, the court must then consider whether, for these special statutory purposes, the land was "used or occupied". When that question is considered in relation to the identified land in Wagga Wagga, derelict as shown in the exhibited photographs, the approach taken and the response given by Mason P in the Court of Appeal was clearly open. Moreover, that response is the better approach to the contested phrase, read in the context of the Land Rights Act with its beneficial and remedial purposes. Application of meaning to the case: According to the facts found by the primary judge, the land was vacant and unused in any actual sense of the word "use". It was in a serious state of disrepair and incapable of being rented. It was no longer used for any of the previous uses to which it had been put. It was surplus to the then current needs of any department or agency of the State of New South Wales. There clearly was no continuing, separate, actual "use" of land for State purposes, co-existing with a decision of the Minister, given substantive 54 (1993) 30 NSWLR 140 at 160-162. Kirby effect, to sell the land. It was instead "non-use" of the land with no present or actual intended "use" for State purposes. That "non-use" ultimately resulted in a decision to dispose of the land. "Use" was not resumed in any "actual" sense before the subject claim was made. Conclusion and order It follows that, without introducing the beneficial and remedial character of the Land Rights Act, the Minister's submissions before this Court were highly persuasive. Certainly, they were open to acceptance. When, however, this ingredient is added to the resolution of the contested issue in the appeal, it requires rejection of the Minister's argument. If the Minister insists that "not lawfully used or occupied" has a different meaning to that preferred by the Court of Appeal in this case (and in earlier decisions), the Minister can introduce legislation to clarify the purpose of the Land Rights Act accordingly and reduce the "claimable Crown lands", as defined. The Minister would then have to accept both political and historical accountability for adopting such a course55. That course would significantly narrow the benefits available to Aboriginal claimants under the Land Rights Act. However, without a clearer expression of the exceptions, it is not an interpretation that this Court should adopt. It would not be consistent with this Court's repeated insistence upon the tripartite modern approach to interpretation of legislation, namely, interpretation by reference to text, context and purpose. This is why I agree in the outcome reached in the joint reasons. The appeal from the orders of the Court of Appeal should be dismissed with costs. 55 cf Griffiths (2008) 82 ALJR 899 at 919 [106]-[107]; 246 ALR 218 at 240-241; Northern Territory v Arnhem Land Aboriginal Land Trust (2008) 82 ALJR 1099 at 1114 [69]. See also United States v Dion 476 US 734 at 739 (1986). HAYNE, HEYDON, CRENNAN AND KIEFEL JJ. On 23 May 2005, the respondent, the New South Wales Aboriginal Land Council ("the Land Council"), on behalf of the Wagga Wagga Local Aboriginal Land Council ("the Wagga Land Council"), made a claim under the Aboriginal Land Rights Act 1983 (NSW) ("the Land Rights Act") to some land at Wagga Wagga. The Minister for Lands refused the claim. The Minister concluded that "when the claim was made the land was not claimable Crown land" within the meaning of the Land Rights Act because "the land was lawfully used and occupied by the Department of Lands in preparing the land for sale". Pursuant to s 36(6) of the Land Rights Act the Land Council appealed to the Land and Environment Court of New South Wales against the refusal of its claim. That Court (Biscoe J) dismissed56 the appeal. The Land Council appealed to the Court of Appeal of the Supreme Court of New South Wales. That Court (Mason P, Giles and Tobias JJA) allowed57 the Land Council's appeal and set aside the orders of the Land and Environment Court. The Court of Appeal made consequential orders declaring that the land claimed is claimable Crown land and ordering the Minister to transfer the land to the Wagga Land Council. By special leave, the Minister now appeals to this Court. As in the courts below, the central issue in this Court is whether the land in question is claimable Crown land. That turns upon whether, when the claim was made, the land was "not lawfully used or occupied"58 and more particularly upon whether, as the appellant submitted, the activities undertaken prior to its intended sale constituted a lawful use of the land. The appellant's submission should be rejected. At the time of the claim the land was "not lawfully used or occupied". The appeal should be dismissed with costs. The Land Rights Act The Land Rights Act constitutes59 the Land Council as a body corporate and as originally enacted provided for Local and Regional Aboriginal Land 56 New South Wales Aboriginal Land Council v Minister Administering the Crown Lands Act [2007] NSWLEC 158. 57 NSW Aboriginal Land Council v Minister Administering Crown Lands Act (2007) 157 LGERA 18. 58 Aboriginal Land Rights Act 1983 (NSW), s 36(1)(b). 59 As originally enacted s 22(1) constituted the Land Council. See now s 104(2). Councils60. Part V of the Act (ss 28-34), as originally enacted, provided for payment from the Consolidated Fund in each year between 1984 and 1998, into a bank account to be maintained by the Land Council, of an amount equal to seven and a half percent of the amount paid as land tax in respect of the previous year. Part V further provided for the Land Council to disburse that money to Local and Regional Aboriginal Land Councils. Part VI of the Land Rights Act as originally enacted dealt with land rights. Section 35 of the Act provided for the vesting of certain former trust lands in Aboriginal Land Councils and Div 2 of Pt VI (ss 36-37) dealt with the subject of claimable Crown lands. Section 36(1) defined "claimable Crown lands" as: "lands vested in Her Majesty that, when a claim is made for the lands under this Division— are able to be lawfully sold or leased, or are reserved or dedicated for any purpose, under the Crown Lands Consolidation Act, 1913, or the Western Lands Act, 1901; are not lawfully used or occupied; and are not needed, nor likely to be needed, for an essential public purpose". By the time of the claim that gives rise to these proceedings that definition had been amended by adding three further paragraphs: one61 excluding lands which, in the opinion of a Crown Lands Minister, are needed or likely to be needed as residential lands and two62 excluding lands which are the subject of a claim under the Native Title Act 1993 (Cth) or a determination of native title under that Act. Nothing turns on those added provisions. In argument, both in this Court and in the courts below, some emphasis was given to the proposition that the Land Rights Act is legislation intended for beneficial and remedial purposes. That this is so is evident both from extrinsic 60 Part II (ss 5-13) dealt with Local Aboriginal Land Councils; Pt III (ss 14-21) dealt with Regional Aboriginal Land Councils. 61 s 36(1)(b1). 62 s 36(1)(d) and (e). materials that preceded the enactment of the Land Rights Act, and from the text of the Act itself. In 1980, a Select Committee of the Legislative Assembly of New South Wales ("the Keane Committee") published a report making "recommendations regarding land rights for New South Wales Aboriginal citizens"63. The Keane Committee recommended that claims to land be founded on any or all of four bases: needs, compensation, long association, and traditional rights. Following the presentation of the Report of the Keane Committee, a Bill for what was to become the Land Rights Act was introduced into the New South Wales Parliament in 1983. A Green Paper, published before the Bill was introduced, said64 that "[w]hilst claimable Crown lands are very limited in comparison to the overall land stock of New South Wales, they will provide a compensatory resource for Aboriginal community groups". The preamble to the Land Rights Act records that: "(1) Land in the State of New South Wales was traditionally owned and occupied by Aborigines: Land is of spiritual, social, cultural and economic importance to Aborigines: It is fitting to acknowledge the importance which land has for Aborigines and the need of Aborigines for land: It is accepted that as a result of past Government decisions the amount of land set aside for Aborigines has been progressively reduced without compensation". In the Court of Appeal, Mason P identified65 the claims process which allows for Aboriginal Land Councils to claim limited categories of Crown lands as the "primary mechanism" for giving effect to the beneficial and remedial purposes of the Land Rights Act. It may readily be accepted that the claims 63 New South Wales, Legislative Assembly, First Report from the Select Committee of the Legislative Assembly upon Aborigines, August 1980 at 19. 64 New South Wales, Minister for Aboriginal Affairs, Green Paper on Aboriginal Land Rights in New South Wales, December 1982 at 11. 65 (2007) 157 LGERA 18 at 24 [20]. process does give effect to those purposes. Whether, as the appellant submitted, it is better to see the provisions for annual payment of substantial sums of money to the Land Council in each year between 1984 and 1998 as a more important means of giving effect to those purposes is a question that need not be pursued. It is not necessary to invoke some principle of "beneficial construction" to resolve the issue in this case. No question is presented in this matter which requires a choice to be made between competing constructions of s 36(1)(b), one described as "broad" and the other as "narrow". Rather, it is necessary to focus upon whether, as the appellant submitted, the activities that were undertaken by or on its behalf prior to the intended sale of the land constituted a lawful use of the land. It is necessary to say something more about the land. The land The land is a corner allotment of about 815 square metres in the business district of Wagga Wagga. At the time of the claim a two storey brick building stood on the site. The land was fenced on three sides. From 1958 until 1985 the land was reserved for "public buildings (motor registry)" and was used as a motor registry. The reservation for "public buildings (motor registry)" was revoked in September 1985 and replaced by a reservation for "public buildings (Government Supply Department Office and Workshop)". Between 1985 and 1998 the land was used by a succession of New South Wales government departments for storage. In 2000, the New South Wales Department of Lands decided to refurbish the site for use as a laboratory. In May 2000, the Wagga Land Council claimed the land and, while that claim was considered, the proposal to refurbish the site for use as a laboratory was not implemented. The claim that was made in May 2000 was refused in June 2003. No appeal was brought from the refusal of that claim. The proposal to use the land as a laboratory was finally abandoned in February 2004. Between about March and November 2004, officers of the Department of Lands made various investigations with a view to preparing a recommendation about the future use or disposal of the land. In December 2004, the officer of the Department who had the carriage of the matter prepared a report recommending that the powers under Pt 4 of the Crown Lands Act 1989 (NSW) (which include the power to sell Crown land) be exercised without first making an assessment of the land under Pt 3 of that Act. The report stated that the "preferred use" of the land was disposal under the current zoning and that there was "no known reason for [the land] to be retained by the State of NSW and any future use [was] better managed by private interests after disposal". It was said that: "The financial return to government from the disposal of this property would provide Treasury with recurrent funds that can be allocated to priority areas of core of government services that will be in the best interests of the State." The officer's recommendation was approved on 23 December 2004. the respondent correctly pointed out, acceptance of this recommendation did not irrevocably commit the Minister to sale of the land. Nonetheless, the decision to accept the recommendation to waive the requirement for land assessment under Pt 3 of the Crown Lands Act is properly identified as a decision to sell the land. Thereafter, several steps were taken towards selling the land. Steps towards sale On 1 February 2005, notice of intention to revoke the reservation of the land from sale was published in the Wagga Wagga Daily Advertiser. Later that month, several local real estate agents were invited to express interest in acting for the vendor on the sale of the land by public auction. In late March 2005, one of those agents was appointed to act for the vendor. During April 2005, an identification survey of the land was made and the Land Titles Office was asked to issue a certificate of title. On 29 April 2005, the reservation of the land for "public buildings (Government Supply Department Office and Workshop)" which had been made in 1985 was cancelled by notice published in the Government Gazette. In May 2005 (before the Land Council made its claim on 23 May 2005), the real estate agent was given the keys to the property. Later that month, but again before the claim, the Registrar-General issued a certificate of title; an auction date of 8 July 2005 was fixed; and a notice of intention to sell the land was prepared but not published. When the claim was made, and for some time before that, the building on the land was in a state of disrepair. In early May 2005, the real estate agent retained to sell the land inspected the property and described it as "rather dirty and in need of a tidy up". The agent referred to some fallen tiles on a staircase as "pos[ing] a potential risk to prospective purchasers" and noted that there were "a number of broken windows at the property". When the claim was made, some office furniture was stored on the site. It was described66 as "old, damaged, disused furniture from the time that the Department refurbished the building in 2000" and as "stored on two levels in the building". In this Court the appellant expressly disclaimed any argument that storing this furniture amounted to a use or an occupation of the building. The decisions below In the Land and Environment Court, Biscoe J concluded67 that "the decision to sell the subject land and the steps taken in furtherance of that intention were an actual use of the land, notwithstanding that they were passive in the sense the land was not physically being used apart from storage of some furniture". In the Court of Appeal, it is evident that the parties' arguments focused upon questions of use of the land and not upon occupation. All members of the Court of Appeal accepted the Land Council's argument that the land was not being used when the claim was made. Much of the reasoning of the Court of Appeal was directed to earlier decisions of that Court concerning what amounts to a relevant use of land. In particular, by reference to earlier decisions of the Court of Appeal, Mason P concluded68 that (a) the "protean word 'use' must be construed in its particular statutory context"69; (b) use "must be more than notional and be present use when the claim is made rather than contemplated or intended use"70; and (c) "[t]he word 'used' in s 36(1)(b) means 'actually used' in the sense of being used in fact 66 [2007] NSWLEC 158 at [46]. 67 [2007] NSWLEC 158 at [67]. 68 (2007) 157 LGERA 18 at 25 [32]-[33]. 69 Daruk Local Aboriginal Land Council v Minister Administering the Crown Lands Act (1993) 30 NSWLR 140 at 164; Minister Administering the Crown Lands Act v NSW Aboriginal Land Council ("Nowra Brickworks [No 1]") (1993) 31 NSWLR 70 Nowra Brickworks [No 1] (1993) 31 NSWLR 106 at 121. and to more than a merely notional degree"71. The reference to use "in fact" and to use being "more than notional" might be understood as directing attention to some physical use of the land. By contrast, Giles JA concluded72 that action to sell land can be "part of the functioning of government in providing accommodation for those providing government services" and gave73 as an example, "if ... the government department has outgrown the accommodation and there is sale of the land and purchase of other land with a prompt transition". Giles JA further concluded74 that "[t]here can be use without physical use". But, like the other members of the Court, Giles JA concluded that the land in question was not being used when the claim was made. The third member of the Court of Appeal, Tobias JA, was of opinion75 that "Crown land does not necessarily become claimable whenever its sale is put in train" and that "[t]his would be so where ... it [the land] continues to be actually used and/or occupied until the date of completion of a contract for its sale". These circumstances were contrasted by Tobias JA with what he identified76 as "[s]teps taken preparatory only to the sale of Crown land (including steps taken to implement a decision to sell) [which] whether regarded individually or cumulatively, are incapable of constituting a lawful user for the purposes of s 36(1)(b)" of the Land Rights Act. The argument on appeal to this Court In its Notice of Appeal, the appellant alleged that the Court of Appeal had erred "in finding that the activities undertaken by and on behalf of the appellant in respect of Crown land prior to its intended sale immediately before the making of a claim did not constitute a lawful use of the land within the meaning of 71 Daruk (1993) 30 NSWLR 140 at 164; Nowra Brickworks [No 1] (1993) 31 NSWLR 106 at 121. 72 (2007) 157 LGERA 18 at 31-32 [70]. 73 (2007) 157 LGERA 18 at 31 [65]. 74 (2007) 157 LGERA 18 at 32 [70]. 75 (2007) 157 LGERA 18 at 33 [80]; see also at 30 [58] per Mason P. 76 (2007) 157 LGERA 18 at 33 [80]. s 36(1)(b)" of the Land Rights Act. In the course of both written and oral argument, however, the appellant necessarily invited attention to the relevant statutory expression, "not lawfully used or occupied", as a whole. The respondent submitted that, to the extent that the appellant directed attention to questions of occupation, the appellant put its case in a way that had not been advanced in the courts below. This, so the respondent submitted, should lead to a revocation of special leave because this Court would be called upon to decide questions about the meaning of "not lawfully ... occupied" without the benefit of any examination of those questions in the Court of Appeal. The respondent further submitted that for this Court to embark on such questions without them having been raised in the Court of Appeal would, in some unspecified sense, be "unfair" to the Court of Appeal. But the respondent did not submit that principles of the kind considered in cases like Suttor v Gundowda Pty Ltd77, Coulton v Holcombe78, or Water Board v Moustakas79 were engaged. That is, the respondent did not submit that any issue about whether the land was occupied was an issue about which the respondent could have called, or would have wished to consider calling, evidence at trial. To the extent, then, that the appellant raised in this Court for the first time any question about whether the land was occupied, the point would be about the legal characterisation of the facts established in the courts below and that would not be a point which the appellant should necessarily be precluded from raising on appeal. And because the appellant's arguments should be rejected and the appeal dismissed, it will be neither necessary nor appropriate to consider separately whether, as the respondent submitted, special leave should be revoked. But in the end, the appellant's arguments are not to be understood as seeking to make some separate point about whether the land was "lawfully ... occupied" when the Land Council made its claim. Rather, as in the courts below, the appellant's arguments were directed to denying that the land was "not lawfully used" at the relevant time, while acknowledging that the expression "not lawfully used" formed part of a larger statutory expression. 77 (1950) 81 CLR 418 at 438; [1950] HCA 35. 78 (1986) 162 CLR 1 at 7-8; [1986] HCA 33. 79 (1988) 180 CLR 491 at 497-498; [1988] HCA 12. See also O'Brien v Komesaroff (1982) 150 CLR 310 at 319; [1982] HCA 33; University of Wollongong v Metwally [No 2] (1985) 59 ALJR 481 at 483; 60 ALR 68 at 71; [1985] HCA 28. It is, however, desirable to say something further about the degree of attention given to the question of use of the land. As has so often been emphasised by this Court, the starting point in a case such as the present must be the relevant statutory text80. In both the Land and Environment Court and in the Court of Appeal it was, of course, necessary to consider what had been said by the Court of Appeal in its earlier decisions about s 36 of the Land Rights Act and about s 36(1)(b) in particular. Inevitably, what was said in those earlier decisions responded the particular facts and circumstances of each case. And it is no doubt for that reason that the focus of the decisions in Daruk Local Aboriginal Land Council v Minister Administering the Crown Lands Act81 and in Minister Administering the Crown Lands Act v NSW Aboriginal Land Council82 was upon whether the land then in question was "not lawfully used". But it is important to recall that the question presented by s 36(1)(b) of the Land Rights Act is whether the lands in question "are not lawfully used or occupied". the arguments advanced about No matter whether the question is framed in the statutory terms ("not lawfully used or occupied") or, as here, is framed more narrowly as one about use, attention must be given to identifying the acts, facts, matters and circumstances which are said to deprive the land of the characteristic of being "not lawfully used or occupied". Of course, it is necessary to measure those acts, facts, matters and circumstances against an understanding of what would constitute use or occupation of the land. But three points should be made. First, nothing that was said in the earlier decisions of the Court of Appeal, and nothing that is said in these reasons, should be understood as attempting some exhaustive definition of when land is not lawfully used or occupied or of what is relevant use or occupation that will take lands outside the definition of claimable Crown lands. Secondly, as Mason P rightly said83, "use" is a protean word. Thirdly, recurring physical acts on the land, by which the land is made to serve some purpose84, will usually constitute a use of the land. And a combination of legal possession, conduct amounting to actual possession, and some degree of 80 See, for example, Weiss v The Queen (2005) 224 CLR 300; [2005] HCA 81. 81 (1993) 30 NSWLR 140. 82 (1993) 31 NSWLR 106. 83 (2007) 157 LGERA 18 at 25 [32]. 84 cf Council of the City of Newcastle v Royal Newcastle Hospital ("the City of Newcastle Case") (1957) 96 CLR 493 at 508 per Kitto J; [1957] HCA 15. permanence or continuity85 will usually constitute occupation of the land. But while these propositions may sufficiently identify the most common cases where it can be said that there is use or occupation of the land, they are not propositions that chart the metes and bounds of those ideas. As the decision86 in Council of the City of Newcastle v Royal Newcastle Hospital ("the City of Newcastle Case") shows, land adjoining hospital grounds and purposely kept in its natural state to provide clean air and quiet undeveloped surroundings, can be said to be "used or occupied by the hospital for the purposes thereof". Hence the importance of directing attention to what are the acts, facts, matters and circumstances which are said to show that land does not meet the description of "not lawfully used or occupied". It is the specification of those acts, facts, matters and circumstances which will provide the greatest help in deciding whether land meets the relevant description. And in the present case, the appellant contended that it was the steps taken towards sale of the land that prevented characterisation of the land as "not lawfully used". Not lawfully used? It was not disputed that the land was not lawfully used or occupied for some time after it ceased to be occupied as a motor vehicles registry. The appellant submitted, however, that once the relevant officials decided that the land should be sold, began the administrative processes necessary to permit sale of the land, and took steps both within the public service and with external parties to implement the decision to sell the land, it was lawfully used. This conclusion was said to follow from reading "lawfully used or occupied" as having a single meaning which is its ordinary meaning as a matter of English language. That ordinary English meaning was said to include the utilisation, exploitation and employment of the land for purposes for the benefit of the State. One form of relevant utilisation, exploitation and employment was identified as sale of the land. It is not necessary to decide whether "lawfully used or occupied" has a single meaning or is better understood by separate consideration of the words "used" and "occupied". This is not a case in which some relevant aspect of the 85 City of Newcastle Case (1957) 96 CLR 493 at 507 per Kitto J. 86 (1957) 96 CLR 493 and, on appeal to the Privy Council, (1959) 100 CLR 1; [1959] meaning of the word "used" is illuminated by the juxtaposed word "occupied". Whether there could be any such illumination in some other case need not be considered. It may be accepted that whether or not the expression is a compound expression having a single meaning, it is an expression that encompasses utilisation, exploitation and employment of the land. There can be no doubt that sale of the land would amount to exploitation of the land as an asset of the owner. Nor can there be any doubt that there are uses of land which can be described as exploitation of the land. It by no means follows, however, that exploitation, by sale, amounts to lawful use of the land let alone its lawful occupation. And it likewise does not follow that the preliminary steps that are inevitably required in order to effect a sale, whether considered separately or together, will amount to lawful use, even if they could be described as steps directed to exploiting the land by selling it. As Fullagar J correctly pointed out87, in his dissenting opinion in the City of Newcastle Case, "[t]he root of the fallacy lies in the assumption that deriving an advantage from the ownership of land is the same thing as using the land". That is, while it is probably true to say that a person who uses land derives an advantage from it, the converse proposition, that deriving an advantage from ownership of the land is using the land, is false88. In particular, taking steps towards selling the land may be directed to the owner deriving the advantages of disposing of an asset and receiving the proceeds of sale. But identifying that the owner seeks to derive these advantages does not show that the land is being used. Rather, what are the acts, facts, matters and circumstances which are said to show that the land is being used? In the present case, subject to the possible qualification required by reference to some transitory visits to the land, nothing was being done on the land when the claim was made, and nothing had been done on the land for a considerable time before the claim was made. There was no physical use of the land during that time. The only possible qualification to that general proposition is that, in the present case, the land was surveyed and the agent appointed to sell the land had gone there and looked inside the building. But even if the agent did this more than once (and there is nothing to suggest that the agent had visited the land more than once) such transitory visits by surveyors and a real estate agent could not be said to amount to a use of the land. And apart from the survey, and 87 (1957) 96 CLR 493 at 506. 88 City of Newcastle Case (1957) 96 CLR 493 at 506 per Fullagar J. the agent inspecting the land, there was no evidence of anything else being done on the land in connection with the proposed sale or for any other purpose. Everything that was being done towards selling the land, apart from the survey and the agent's inspection, occurred at places other than the land. Those steps concerned the land in the sense that they were directed towards its sale. They were steps directed to deriving the advantages of disposing of the asset and receiving the proceeds of sale. They did not amount to a use of the land. The land was not being lawfully used when the respondent claimed it. It is not necessary, in this case, to decide whether there are steps, taken on the land in preparation for its sale, which are steps of a kind that could constitute use or occupation of the land. It suffices to conclude that neither the decision to realise this land, nor the steps taken within the administration of government to achieve that end, which were all steps that occurred away from the land, constituted use of the land. The appeal should be dismissed with costs.

HIGH COURT OF AUSTRALIA AND APPELLANT RESPONDENT King v Philcox [2015] HCA 19 10 June 2015 ORDER Appeal allowed. Set aside paragraphs 1 and 3.1, and paragraph 2 insofar as that paragraph relates to the setting aside of the judgment appealed against, of the order of the Full Court of the Supreme Court of South Australia made on 4 June 2014 and, in their place, order that the appeal be dismissed. The appellant pay the respondent's costs of the appeal to this Court. On appeal from the Supreme Court of South Australia Representation M C Livesey QC with B J Doyle for the appellant (instructed by Finlaysons Lawyers) P A Heywood-Smith QC with G Stathopoulos for the respondent (instructed by SE Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS King v Philcox Negligence – Duty of care – Mental harm – Motor accident – Civil Liability Act 1936 (SA) – Appellant negligently drove motor vehicle resulting in death of passenger – Respondent witnessed aftermath – Respondent later realised brother died in accident – Whether appellant as driver owed duty of care to passenger's brother not to cause mental harm – Whether mental harm to brother of person killed foreseeable under s 33 of Civil Liability Act – Whether sibling relationship relevant to foreseeability. Negligence – Damages for mental harm – Civil Liability Act 1936 (SA) – Whether respondent present at scene of accident when accident occurred – Whether accident includes aftermath. Words and phrases – "accident", "duty of care", "incident", "present at the scene the accident occurred", "proximity", "reasonably foreseeable". the accident when Civil Liability Act 1936 (SA), ss 33, 53(1)(a). FRENCH CJ, KIEFEL AND GAGELER JJ. Introduction On 12 April 2005 between 4.50pm and 4.55pm Scott Philcox was a passenger in a motor vehicle driven by George King, the appellant, in Campbelltown, a suburb of Adelaide. As a result of Mr King's negligence the vehicle collided with another at the intersection of Newton/Darley and Gorge Roads. Scott Philcox was fatally injured and died at about 5.30pm while trapped in the vehicle. The deceased's brother, Ryan Philcox, the respondent to this appeal, heard of the accident, which caused his brother's death, a few hours later. He then realised that he had driven past the location of the accident earlier that day while the vehicle in which his brother was trapped and dying was still there. Subsequently, he developed a major depressive disorder. Mr King was found by the Full Court of the Supreme Court of South Australia1, on Ryan Philcox's appeal from the District Court of South Australia2, to be liable to pay Ryan Philcox damages for mental harm. Mr King appeals against that decision on two grounds. The first ground is that he did not owe Ryan Philcox a duty of care. He relies upon s 33 of the Civil Liability Act 1936 (SA) ("the Civil Liability Act (SA)"). That section confines the cases in which one person (the defendant) owes a duty of care not to cause mental harm to another (the plaintiff) to cases in which a reasonable person in the defendant's position would have foreseen that a person of normal fortitude in the plaintiff's position might, in the circumstances of the case, have suffered a psychiatric illness. Mr King contends that the circumstances of the case did not satisfy that necessary condition. The second ground relied upon by Mr King is that because Ryan Philcox was not present at the scene of the accident when the accident occurred, he did not satisfy the condition imposed by s 53(1)(a) of the Civil Liability Act (SA) upon recovery of damages for mental harm by someone other than a parent, spouse or child of a person killed, injured or endangered in an accident. While it has not been shown to have erred in finding that a duty of care existed, the Full Court was in error in holding that Ryan Philcox was present at the scene of the accident when the accident occurred within the meaning of s 53(1)(a). That conclusion means that Ryan Philcox was not entitled to recover damages for mental harm and that the appeal must be allowed. 1 Philcox v King (2014) 119 SASR 71. 2 Philcox v King [2013] SADC 60. Procedural background Although duty of care was in issue at trial in the District Court, the focus of the case was upon causation and the application of s 53(1)(a). On 10 May 2013, her Honour Judge Bampton made an order that Ryan Philcox was "not entitled to an award of damages for mental harm". She did so in part on the basis that he was not present at the scene of the accident when the accident occurred within the meaning of s 53(1)(a). The Full Court of the Supreme Court of South Australia held that the primary judge had found, and found correctly, that Mr King owed Ryan Philcox a duty of care. It also held, however, that the primary judge erred in finding that Ryan Philcox was not present at the scene of the accident when it occurred. The Full Court allowed his appeal against the judgment of the District Court and awarded him damages in the sum of $69,212.75. It ordered that Mr King pay Ryan Philcox's costs of the action and of the appeal. On 14 November 2014, this Court gave Mr King special leave to appeal against the decision of the Full Court3. Special leave was granted on the undertaking that he would not seek to disturb orders as to costs which had been made in the Supreme Court and that he would pay Ryan Philcox's costs of the appeal, including the costs of the application for special leave, in any event4. The District Court findings The primary judge accepted Ryan Philcox's evidence, in particular, his evidence of five occasions on which he drove through or turned left at the intersection5 and his evidence of how he learned of his brother's death. His evidence, as summarised in the primary judge's reasons, was as follows6: At about 5.00pm Ryan Philcox drove through the intersection on the way to pick up his girlfriend from her workplace. He noticed that an accident had occurred in the centre of the intersection. He did not think that anyone involved in it had been seriously injured. [2014] HCATrans 253 (French CJ and Keane J). 4 A certificate at the end of the second defence stated it was put forward in accordance with the instructions of Allianz Australia Insurance Ltd, the claims manager for the compulsory third party insurer for Mr King. The insurer had the conduct of the defence of the action pursuant to s 125 of the Motor Vehicles Act [2013] SADC 60 at [9]. [2013] SADC 60 at [10]‒[24]. Shortly after 5.00pm, having picked up his girlfriend, he drove back through the intersection. Police officers were directing traffic and emergency vehicles were present. He drove back to his home at Campbelltown. (iii) He drove from Campbelltown with his girlfriend to her parents' home at Rostrevor for dinner. On the way he turned left at the intersection onto Gorge Road. He would have seen the vehicles involved in the accident as he went past the scene but did not take any notice of them. (iv) Half an hour after arriving at his girlfriend's parents' home, Ryan Philcox had to return to his home at Campbelltown to collect something. Again he passed through the intersection, which was five minutes away. He noticed a blue or grey wagon with severe damage on the passenger side on a flatbed tow-truck. The wagon had been cut open to retrieve someone and he wondered about the injuries sustained by those in the vehicle. (v) When he travelled back to Rostrevor from his home a short time later the intersection had been cleared. (vi) Ryan Philcox's parents came to his girlfriend's parents' home between 10.30pm and 11.00pm and told him that his brother had been killed in a traffic accident. He then realised that this was the accident, the aftermath of which he had witnessed, at the intersection. (vii) He returned to the intersection in the early hours of the following morning. He thought he stayed there for a few hours. He was angry at himself for being at the intersection and not knowing what had happened to his brother. As he put it, he was "angry, guilty for not knowing, [and] not stopping". In summary the primary judge held7: (i) Mr King owed Ryan Philcox a duty of care. (ii) Ryan Philcox suffered mental harm within the meaning of the Civil Liability Act (SA) consisting of a recognised psychiatric illness, as a result of sudden shock upon receiving the news of his brother's death. [2013] SADC 60 at [103]. (iii) Ryan Philcox did not witness, at the scene of the accident, his brother being killed, injured or put in peril and was therefore not present at the scene of the accident when the accident occurred. If the preceding conclusions were wrong and Ryan Philcox was present at the scene of the accident at the time the accident occurred, that circumstance did not cause the mental harm he suffered. That harm was caused when he received the news of his brother's death8. The last mentioned finding was said by the primary judge to have the result that "s 53(2) is not satisfied"9. How it related to s 53(2) was not apparent. On the basis of the findings in (iii) and (iv) Ryan Philcox was held not to be entitled to damages for mental harm. The Full Court decision In the Full Court Mr King filed a notice of alternative contention challenging the primary judge's finding that he owed Ryan Philcox a duty of care10. That contention was briefly dismissed by Gray J, who wrote the leading judgment, with which Sulan J and Parker J, who wrote shorter and separate judgments, agreed11: "To my mind, the observations of the High Court in Wicks v State Rail Authority (NSW) have direct application to s 33 as discussed above. It was open to the judge to conclude that a duty was owed. Further, in the circumstances, I consider that plainly a duty was owed. It was reasonably foreseeable that a sibling coming upon the scene of this collision, including its aftermath would, on hearing of his brother's death, suffer mental harm." (footnote omitted) The approach of the Full Court to the construction and application of s 53(1)(a) of the Civil Liability Act (SA) is discussed below. Essentially, the Court found that Ryan Philcox had been present at the scene of the accident [2013] SADC 60 at [101]. [2013] SADC 60 at [101]. 10 (2014) 119 SASR 71 at 77 [18]. 11 (2014) 119 SASR 71 at 77 [20]. when the accident occurred and that he thereby satisfied the condition for recovery of damages for pure mental harm. The legislation — history and construction The Civil Liability Act (SA) began its life as the Wrongs Act 1936 (SA) ("the Wrongs Act 1936"). The Wrongs Act 1936 was renamed and substantially amended pursuant to the Law Reform (Ipp Recommendations) Act 2004 (SA) ("the Law Reform Act 2004"). The Law Reform Act 2004 introduced the current ss 33 and 5312. Section 33 relevantly provides: "(1) A person (the defendant) does not owe a duty to another person (the plaintiff) to take care not to cause the plaintiff mental harm unless a reasonable person in the defendant's position would have foreseen that a person of normal fortitude in the plaintiff's position might, in the circumstances of the case, suffer a psychiatric illness. For the purposes of this section— in a case of pure mental harm, the circumstances of the case to which the court is to have regard include the following: whether or not the mental harm was suffered as the result of a sudden shock; (ii) whether the plaintiff witnessed, at the scene, a person being killed, injured or put in peril; (iii) the nature of the relationship between the plaintiff and any person killed, injured or put in peril; (iv) whether or not there was a pre-existing relationship between the plaintiff and the defendant; in a case of consequential mental harm, the circumstances of the case include the nature of the bodily injury out of which the mental harm arose." 12 Neither s 33 nor s 53 have been amended save for the introduction of the class of "domestic partner" after "spouse" in s 53(1)(b) by s 46 of the Statutes Amendment (Domestic Partners) Act 2006 (SA). Section 33 appears in Pt 6, entitled "Negligence". The term "negligence" is defined as "failure to exercise reasonable care and skill, and includes a breach of a tortious, contractual or statutory duty of care"13. The term "duty of care" is defined as "a duty to take reasonable care or to exercise reasonable skill (or both)"14. The present case concerns "pure mental harm", defined as "mental harm other than consequential mental harm". "Consequential mental harm" is mental harm that is a consequence of bodily injury to the person suffering the mental harm, which is not this case. "Mental harm" is "impairment of a person's mental condition"15. "Accident" is defined as "an incident out of which personal injury arises and includes a motor accident". A "motor accident" means an incident in which personal injury arises out of the use of a motor vehicle16. The common law, as explained in Wicks v State Rail Authority (NSW)17, rejects propositions that "reasonable or ordinary fortitude", "shocking event" or "directness of connection" are preconditions to liability additional to "the central question ... whether, in all the circumstances, the risk of the plaintiff sustaining such an injury was reasonably foreseeable". Section 33 does not adopt any of those criteria as additional conditions of liability save that the foreseeability of risk must relate to "a person of normal fortitude in the plaintiff's position". The circumstances set out in s 33(2) are not necessary conditions of the existence of a duty of care. Rather they are to be treated as relevant to the assessment of that foreseeability of harm that is a necessary condition. The term "psychiatric illness" used in s 33(1) describes a subset of "mental harm". A similar category is also found in s 53(2), which limits recovery of damages awarded for pure 13 Civil Liability Act (SA), s 3, definition of "negligence", which gave effect to Recommendation 2 of the "Ipp Report": see Commonwealth of Australia, Review of the Law of Negligence: Final Report, (2002) at 36. 14 Civil Liability Act (SA), s 3, definition of "duty of care". 15 Civil Liability Act (SA), s 3, definitions of "mental harm", "consequential mental harm" and "pure mental harm". 16 Civil Liability Act (SA), s 3, definitions of "accident" and "motor accident". The definition of "motor accident" was amended by cl 2(1) of Sched 2 to the Motor Vehicle Accidents (Lifetime Support Scheme) Act 2013 (SA) to insert "is caused by or" before "arises out of". 17 (2010) 241 CLR 60 at 71‒72 [25]; [2010] HCA 22. mental harm to cases of harm consisting of "a recognised psychiatric illness"18. The question of causation is not raised by the grounds of appeal in this case. It follows, for the purposes of this appeal, that if Mr King owed Ryan Philcox the relevant duty of care, it was breached by his negligent driving which had the consequence that Ryan Philcox suffered a recognised psychiatric illness. If the duty of care existed and was breached the second question arises, namely, whether Ryan Philcox was disentitled by s 53 from recovering damages because he was not present at the scene of the accident when the accident occurred. Section 53 is within Pt 8 of the Civil Liability Act (SA), which applies where damages are claimed for personal injury arising from a motor accident or from an accident caused wholly or in part by negligence19. It provides: "(1) Damages may only be awarded for mental harm if the injured person— (a) was physically injured in the accident or was present at the scene of the accident when the accident occurred; or is a parent, spouse or child of a person killed, injured or endangered in the accident. (2) Damages may only be awarded for pure mental harm if the harm consists of a recognised psychiatric illness. (3) Damages may only be awarded for economic loss resulting from consequential mental harm if the harm consists of a recognised psychiatric illness." The text of both ss 33 and 53 must be understood in their context and in part by reference to their legislative histories. 18 It is not necessary for present purposes to consider whether "a recognised psychiatric illness" is a narrower concept than "a psychiatric illness". 19 Civil Liability Act (SA), s 51(a)(i)‒(ii)(A). As enacted, the Wrongs Act 1936 contained no provision relating to recovery for nervous shock. The common law in the United Kingdom and in Australia at that time was not sympathetic to such recovery, treating it as "too remote"20 and outside the scope of the relevant duty of care21. In 1939, however, a new s 28(1) was introduced into the Wrongs Act 193622 providing that a plaintiff should not be debarred from recovering damages for injury arising wholly or in part from mental or nervous shock23. A similarly motivated and more significant legislative response in New South Wales was the enactment of s 4 of the Law Reform (Miscellaneous Provisions) Act 1944 (NSW). It was discussed in Gifford v Strang Patrick Stevedoring Pty Ltd24. Section 4 allowed for recovery for mental or nervous shock for a parent, husband or wife of a person killed, injured or put in peril by the negligence of the defendant. It also allowed recovery for any other member of the victim's family where the victim was "killed, injured or put in peril within the sight or hearing of such member of the family"25. The new provision used the language of sensory perception later found in s 30(2) of the Civil Liability Act 2002 (NSW) and considered by this Court in Wicks. Importantly, however, it operated as a defined extension of liability. 20 Victorian Railways Commissioners v Coultas (1888) 13 App Cas 222. 21 Chester v Waverley Corporation (1939) 62 CLR 1; [1939] HCA 25. 22 Wrongs Act Amendment Act 1939 (SA), s 6. 23 See discussion in Richards v Baker [1943] SASR 245 at 248‒249 and similar provisions in other jurisdictions: Law Reform (Miscellaneous Provisions) Act 1944 (NSW), s 3(1); Wrongs Act 1932 (Vic), s 4; Law Reform (Miscellaneous Provisions) Ordinance 1955 (ACT), s 23(1); Law Reform (Miscellaneous Provisions) Ordinance 1956 (NT), s 24(1). 24 See especially (2003) 214 CLR 269 at 277‒280 [14]‒[22] per Gleeson CJ, 295‒298 [70]‒[79] per Gummow and Kirby JJ (Hayne J agreeing at 303 [96]); see also at 282‒286 [32]‒[42] per McHugh J, 311‒316 [124]‒[131] per Callinan J; [2003] HCA 33. Similar provisions were enacted in the Australian Capital Territory and the Northern Territory: Law Reform (Miscellaneous Provisions) Ordinance 1955 (ACT), s 24; Law Reform (Miscellaneous Provisions) Ordinance 1956 (NT), s 25. 25 See Mount Isa Mines Ltd v Pusey (1970) 125 CLR 383 at 407‒408 per Windeyer J; [1970] HCA 60. In 1983, the Full Court of the Supreme Court of South Australia in Coffey v Jaensch26 held that a woman who suffered nervous shock after seeing her husband in hospital following a motor accident and being told that he might not survive, could recover damages. This Court affirmed that decision on appeal in Jaensch v Coffey27. In his Second Reading Speech for the Bill which became the Wrongs Act Amendment Act 1986 (SA), the Attorney-General for South Australia described the Bill as limiting the range of persons entitled to claim for nervous shock. He did not refer to the decision of the High Court but cited that of the Full Court as having extended the law beyond cases in which28: "nervous shock is suffered by a person in the proximity of injury or peril caused to a third party by the negligence of another". The proposed amendment was evidently not intended to affect the common law as stated in Jaensch v Coffey but "to prevent any further expansion of this head of damage"29. Section 35A(1)(c) was the precursor of s 53. It precluded recovery for mental harm or nervous shock arising from a "motor accident" except in favour of a person physically injured in the accident, a person who was a driver or passenger of or in a motor vehicle involved in the accident, a person "who was, when the accident occurred, present at the scene of the accident"30, or "a parent, spouse or child of a person killed, injured or endangered in the accident"31. The term "motor accident" was defined as "an incident in which injury is caused by or arises out of the use of a motor vehicle"32. Unlike s 4 of the Law Reform (Miscellaneous Provisions) Act 1944 (NSW), s 35A(1)(c) was expressly directed to the limitation of liability. That was its purpose, as appeared 26 (1983) 33 SASR 254. 27 (1984) 155 CLR 549; [1984] HCA 52. 28 South Australia, Legislative Council, Parliamentary Debates (Hansard), 27 November 1986 at 2410. 29 South Australia, Legislative Council, Parliamentary Debates (Hansard), 27 November 1986 at 2410. 30 Wrongs Act 1936, s 35A(1)(c)(i). 31 Wrongs Act 1936, s 35A(1)(c)(ii). 32 Wrongs Act 1936, s 35A(6). from the Second Reading Speech33, and that was its operation, as appeared from its text. In 2002, s 35A(1)(c) was repealed34. The limitation it imposed upon recovery of damages for mental or nervous shock arising out of a motor accident was extended by a new s 24C to cover mental or nervous shock arising out of any accident35. Section 24C provided: "Damages may only be awarded for mental or nervous shock if the injured person— (a) was physically injured in the accident or was present at the scene of the accident when the accident occurred; or is a parent, spouse or child of a person killed, injured or endangered in the accident." The same amending legislation introduced the current definition of the word "accident"36. In the Second Reading Speech it was said37: "The current rule in motor accident cases that damages for mental or nervous shock may only be awarded in limited circumstances is carried over to other personal injury cases. In essence, the claimant must have been physically injured in the accident, or present at the scene at the 33 The operation of s 35A(1)(c) was explained as limiting awards for mental and nervous shock to an injured party, a person at the scene of the accident or a parent, spouse or child of a person killed, injured or endangered in an accident: see South Australia, Legislative Council, Parliamentary Debates (Hansard), 27 November 34 Wrongs (Liability and Damages for Personal Injury) Amendment Act 2002 (SA), 35 Wrongs (Liability and Damages for Personal Injury) Amendment Act 2002 (SA), 36 Wrongs (Liability and Damages for Personal Injury) Amendment Act 2002 (SA), 37 South Australia, House of Assembly, Parliamentary Debates (Hansard), 14 August relevant time, unless the claimant is the parent, spouse or child of someone killed, injured or endangered in the accident." The condition of recoverability of damages by a person other than a parent, spouse or child of the victim, of presence "at the scene of the accident when the accident occurred", was continued. The Law Reform Act 2004, which renamed the Wrongs Act 1936 as the Civil Liability Act 1936 (SA) and enacted ss 33 and 53, was described in the Second Reading Speech as implementing the key liability recommendations contained in the Review of the Law of Negligence Final Report dated September 2002 ("the Ipp Report")38. It did not attempt a codification of the law of negligence39. Sections 33 and 53 were based in part on Recommendation 34 of the Ipp Report. Recommendation 34(a) proposed that there be "no liability for pure mental harm" unless the relevant harm consisted of a recognised psychiatric illness40. That constraint is reflected in s 33(1) limiting the nature of the foreseeable mental harm which conditions the duty of care. It is also reflected in the constraint found in s 53(2). Recommendation 34(c) of the Ipp Report dealt with presence at the scene of the accident but only as one of a number of "circumstances of the case" going to the question of whether pure mental harm was foreseeable in the terms proposed in Recommendation 34(b). Relevantly, the proposed circumstances set out in Recommendation 34(c) were: whether the plaintiff was at the scene of shocking events or witnessed them or their aftermath41; and whether the plaintiff witnessed the events or their aftermath with his or her 38 Commonwealth of Australia, Review of the Law of Negligence: Final Report, 39 South Australia, Legislative Council, Parliamentary Debates (Hansard), 15 October 2003 at 351. 40 Ipp Report at 144. 41 Ipp Report at 144, Recommendation 34(c)(ii). 42 Ipp Report at 144, Recommendation 34(c)(iii). The absence of any reference to "aftermath" in either s 33 or s 53 is significant having regard to the terms of Recommendation 34(c)(ii)‒(iii). It is also significant that the Recommendation distinguished between a plaintiff who was at the scene of or witnessed the shocking events and a plaintiff who witnessed their aftermath. That accords with ordinary English usage. To witness the aftermath of an event is not to witness the event itself. Sections 33 and 53 of the Civil Liability Act (SA) were said in the Second Reading Speech for the Law Reform Act 2004 to restate the existing law with a departure43. The departure was the requirement, contained in s 53(3), that, in the case of consequential mental harm, damages for economic loss would be recoverable only if the mental harm amounted to a recognised psychiatric illness. That provision is not material for present purposes as it only relates to mental harm that is a consequence of bodily injury to the person suffering the mental harm. In the Explanation of Clauses incorporated in Hansard, s 53 was described as a "substituted provision [which] uses the previous provision [s 24C] as a basis but amends it in keeping with the Ipp recommendations"44. Section 53(1)(a) applied The text of s 53(1)(a), read in light of its legislative ancestry and by way of contrast with the Ipp Report Recommendations, does not support the extended notion of "[presence] at the scene of the accident when the accident occurred" for which Ryan Philcox contends. According to ordinary English usage he drove past "the scene of the accident" several times. Assuming he can be taken, on that basis, to have been "present at the scene of the accident", he was not "present at the scene of the accident when the accident occurred". A similar approach to the same words, appearing in s 77(a)(ii) of the Motor Accidents Act 1988 (NSW) ("the Motor Accidents Act")45, was taken by 43 South Australia, Legislative Council, Parliamentary Debates (Hansard), 15 October 2003 at 354. 44 South Australia, Legislative Council, Parliamentary Debates (Hansard), 15 October 2003 at 356. 45 Section 77(a)(ii) was expressed in the following terms: "was, when the accident occurred, present at the scene of the accident". the Court of Appeal of New South Wales in Hoinville-Wiggins v Connelly46, in which Giles JA, with whom Mason P and Stein JA agreed, said that47: "Close connection in space and time is required. The words 'when the accident occurred' mean that it is not enough that [the plaintiff] came to the scene of the accident after the accident had occurred, as might have happened in 'rescuer' cases at common law." Similarly, in Spence v Biscotti48 Miles CJ, dealing with the same provision in proceedings in the Supreme Court of the Australian Capital Territory, said49: "An accident is an event in space as well as time: hence the term in s 77 'scene of the accident'. The plaintiff must satisfy a spatial and temporal test, present at that place, the scene, when that event, the accident, occurred. In my view, there is nothing to require the term 'accident' to include the immediate consequences of the accident or its immediate aftermath." Sulan J in the Full Court considered that s 77 of the Motor Accidents Act could be distinguished from s 53(1)(a) as that Act did not define "accident". The definition of "accident" in the Civil Liability Act (SA), his Honour said, imported the term "incident", which was said to be synonymous with an event, eventuality or aftermath. The definition of a "motor accident" was therefore broad enough to encompass events directly related to and following on from the actual impact50. Parker J also viewed the use of the word "incident" in the definition of "accident" as extending the ordinary meaning of accident51. With respect to their Honours, the relevant ordinary English meaning of the word "incident" is "[a] distinct occurrence or event"52. The use of the term 46 (1999) 29 MVR 169. 47 (1999) 29 MVR 169 at 173 [23]. 48 (1999) 151 FLR 350. 49 (1999) 151 FLR 350 at 359 [31]. 50 (2014) 119 SASR 71 at 90 [64]‒[66]. 51 (2014) 119 SASR 71 at 90 [70]. 52 Shorter Oxford English Dictionary, 5th ed (2002) at 1343, "incident", sense 2. "incident" in the definition of "accident" dates back to the enactment of s 35A(1)(c), when it was used to define the class of event constituting a "motor accident" by reference to the use of a motor vehicle. The approach taken by the Full Court also invoked the reasoning adopted by this Court in Wicks, which was seen as applicable to the construction and application of s 53. That approach makes it necessary to compare the text of s 53 with that of the analogous but significantly different text of s 30 of the Civil Liability Act 2002 (NSW) ("the New South Wales Act"), which was considered in Wicks. Under s 30, it was a necessary condition of the entitlement to recover damages for pure mental harm for any person other than a close member of the victim's family that "the plaintiff witnessed, at the scene, the victim being killed, injured or put in peril"53. Similar language of sensory perception had appeared in s 4 of the Law Reform (Miscellaneous Provisions) Act 1944, discussed earlier in these reasons. The purpose of s 30, however, was to limit liability, whereas s 4 had defined the bounds of an extension of liability. The criterion in s 30(2) limiting recoverability of damages was identical with the circumstance of foreseeability conditioning the existence of a duty of care in the New South Wales Act54. There was, therefore, a degree of symmetry within the New South Wales statute that is missing from the South Australian Act. The question of the existence of a duty of care was not decided by this Court in Wicks55. The Court considered the application of s 30(2) on the assumption that a relevant duty of care was owed56. The key submission by State Rail was that the necessary condition of recovery for mental harm required a plaintiff to have observed at the scene an event unfolding which included another's death, injury or peril57. The Court held that s 30(2)(a) directed attention to an event that was happening while the plaintiff "witnessed" it58. The Court held59: 53 New South Wales Act, s 30(2)(a). 54 New South Wales Act, s 32(2)(b). 55 (2010) 241 CLR 60 at 73 [33], 74 [35]. Duty of care had not been decided by the Court of Appeal of New South Wales and the parties in Wicks submitted that this Court should not decide it either. 56 (2010) 241 CLR 60 at 74 [36]. 57 (2010) 241 CLR 60 at 75 [40]. 58 (2010) 241 CLR 60 at 76 [43]. 59 (2010) 241 CLR 60 at 76 [44]. "It would not be right ... to read s 30, or s 30(2)(a) in particular, as assuming that all cases of death, injury or being put in peril are events that begin and end in an instant, or even that they are events that necessarily occupy only a time that is measured in minutes." As appears from that passage and the arguments that were put to the Court in Wicks, the text of s 30(2)(a) required a different enquiry from that required by the text of s 53(1)(a) of the Civil Liability Act (SA). In the Full Court, Gray J said that what had been said in Wicks, in connection with s 30(2) of the New South Wales Act, had "obvious relevance"60 to the construction of s 53 of the Civil Liability Act (SA). However, having regard to the textual differences and the enquiry which they require of a court in determining whether damages are recoverable, the statement that "Section 30 is broadly comparable to s 53"61 is apt to lead to error, as it did in this case. The submissions for Ryan Philcox with respect to s 53 followed the reasoning of the Full Court. To the extent that that reasoning and Ryan Philcox's submissions relied upon this Court's reasoning in Wicks in its application to s 30(2) of the New South Wales Act, they did not give effect to the significant textual differences between the two provisions. Ryan Philcox was not present at the scene of the accident when the accident occurred. The Full Court erred in its construction and application of s 53(1)(a) in this case. Duty of care — s 33 Having regard to the disentitling operation of s 53, it is not strictly necessary to decide whether the Full Court erred in holding that Mr King owed a duty of care not to cause pure mental harm to Ryan Philcox. At common law, as under s 33, the existence of a duty of care not to cause another person pure mental harm is dependent upon a number of variables which inform the foreseeability of risk. Section 33 does not prescribe any particular pre-existing relationship. It does not require the plaintiff to have witnessed at the scene a person being killed, injured or put in peril. It does not require a sudden shock. It does require that the defendant has in contemplation a person of normal fortitude in the plaintiff's position. Having regard to the variables which can be taken into account for the purpose of determining the existence of the duty of care, it cannot be said that the conclusion reached by the Full Court in this case 60 (2014) 119 SASR 71 at 80 [28]. 61 (2014) 119 SASR 71 at 78 [25]. was wrong. This Court has considered the extent of the common law duty of care not to cause mental harm to a person connected with the primary victim in decisions which have necessarily focussed upon the particular relationships between the victim and the plaintiff. To say that a duty of care is owed to a parent62, spouse63, child64, fellow employee or rescuer65 of a victim is not to say that it cannot be owed to the sibling of a victim. The terms of s 33 are consistent with that approach for they include, as one of the circumstances relevant to the foreseeability that is a necessary condition of the duty of care, "the nature of the relationship between the plaintiff and any person killed, injured or put in peril". A sibling relationship is a circumstance of that character. Whether it is a close or loving relationship or a distant one may go to the question of causation more than the existence of a duty of care, but it is not necessary to explore that issue further for the purposes of this case. Counsel for Mr King made submissions against the existence of a duty of care based upon analogical arguments from other decisions. However, as Windeyer J said in Mount Isa Mines Ltd v Pusey66: "We must always beware lest words used in one case become tyrants over the facts of another case." Conclusion Despite the existence of a duty of care and its breach and resulting mental harm to Ryan Philcox, his claim is defeated by the explicit language of the condition imposed by s 53(1)(a). The Court cannot go beyond the clear meaning of the text, which allows of no reasonable alternative construction favourable to Ryan Philcox. For the preceding reasons, the appeal will be allowed. The following orders should be made: The appeal is allowed. 62 Annetts v Australian Stations Pty Ltd (2002) 211 CLR 317; [2002] HCA 35. 63 Jaensch v Coffey (1984) 155 CLR 549. 64 Gifford v Strang Patrick Stevedoring Pty Ltd (2003) 214 CLR 269. 65 Mount Isa Mines Ltd v Pusey (1970) 125 CLR 383. 66 (1970) 125 CLR 383 at 400. Set aside paragraphs 1 and 3.1, and paragraph 2 insofar as that paragraph relates to the setting aside of the judgment appealed against, of the order of the Full Court of the Supreme Court of South Australia made on 4 June 2014 and, in their place, order that the appeal be dismissed. The appellant is to pay the respondent's costs of the appeal to this Court. KEANE J. It may be accepted that the courts below were right to hold that the appellant owed the respondent a duty to exercise reasonable care in the manner of his driving so as to avoid injury to the respondent. Because the respondent was not a parent, spouse or child of the deceased, s 53(1)(a) of the Civil Liability Act 1936 (SA) ("the Act") prevented him from recovering damages for the mental harm he was caused by the appellant's negligent driving unless he was "present at the scene of the accident when the accident occurred". This was so even though the appellant had, by his negligent driving, breached his duty of care to the respondent. Section 53(1) of the Act provided relevantly that: "Damages may only be awarded for mental harm if the injured person— (a) was … present at the scene of the accident when the accident occurred; or is a parent, spouse or child of a person killed, injured or endangered in the accident." The respondent was not "present at the scene of the accident when the accident occurred" for two independent reasons. First, the respondent was not present at the scene of the accident: that he was in the same locale as the accident is insufficient to satisfy s 53(1)(a) of the Act. Secondly, even if the respondent was present at the scene of the accident, he was not present when the accident occurred. It is convenient to deal first with this latter point. Its determination is assisted by the decision of the Court of Appeal of the Supreme Court of New South Wales in Hoinville-Wiggins v Connelly67. When the accident occurred In Hoinville-Wiggins, the Court was concerned with the construction of s 77(a)(ii) of the Motor Accidents Act 1988 (NSW) ("the MAA"), a close analogue of s 53(1)(a) of the Act. The plaintiff, having been told of a motor vehicle accident involving a pedestrian nearby, went to the scene and administered mouth to mouth resuscitation to the pedestrian until it became apparent that the pedestrian had died. The plaintiff claimed damages for nervous shock. Section 77(a)(ii) of the MAA provided that no damages for psychological or psychiatric injury shall be awarded in respect of a motor vehicle accident except in favour of a person who was, inter alia, present at the scene of the accident "when the accident occurred". The primary judge held that the plaintiff was not present at the scene of the accident when the accident occurred. This 67 (1999) 29 MVR 169. conclusion was upheld on appeal. Of s 77(a)(ii) of the MAA, Giles JA, with whom Mason P and Stein JA agreed, said68: "The words 'when the accident occurred' mean that it is not enough that [the plaintiff] came to the scene of the accident after the accident had occurred, as might have happened in 'rescuer' cases at common law. The [plaintiff] argued that the accident included what she described as its aftermath, and extended to her attendance to minister to the pedestrian. For the notion of aftermath she referred to Benson v Lee69; McLoughlin v O'Brian70 and Jaensch v Coffey71. The passages were to do with recovery at common law of damages for nervous shock suffered not only by a plaintiff who saw or heard the accident, but also by a plaintiff who saw or heard events at the scene of the accident after its occurrence or even at a hospital during immediate post-accident treatment. They distinguished between the accident and its aftermath. Section 77 limits this common law position, because the plaintiff must have been present at the scene of the accident and must have been present at the scene of the accident when the accident occurred … The aftermath was never part of the accident and (at least for the purposes of s 77(a)) seeing or hearing the aftermath no longer founds recovery of damages. … The accident occurred when the opponent's motor vehicle struck the pedestrian, whether or not the pedestrian's death was immediate, and the [plaintiff's] presence in the classroom, unaware of the accident until Ms Kelly told her of it, was not presence at the scene of the accident at that time." The same view of the operation of s 77(a)(ii) of the MAA was taken by Miles CJ in Spence v Biscotti72. It is the approach which should have been applied in this case. It was not disputed that Hoinville-Wiggins was correctly decided. The analysis undertaken in that case was applicable here in relation to the materially similar language of s 53(1)(a) of the Act. 68 (1999) 29 MVR 169 at 173 [23]-[24]. 69 [1972] VR 879 at 880. 70 [1983] 1 AC 410 at 422. 71 (1984) 155 CLR 549 at 606-608; [1984] HCA 52. 72 (1999) 151 FLR 350 at 358-359 [31]. In the present case, each member of the Full Court rejected73 the appellant's argument that the phrase "present at the scene of the accident when the accident occurred" required that the respondent should have witnessed the impact of the vehicles in the accident. Several strands of reasoning were said to support that conclusion: none is compelling. "The facts constituting a road accident and its aftermath are not confined to 'the immediate point of impact'. It includes the aftermath of an accident which encompasses events at the scene after its occurrence, including the extraction and removal of persons from damaged vehicles." With respect, to say that an "accident … encompasses events at the scene after its occurrence" is expressly to depart from the language of s 53(1)(a) of the Act. Events which take place after an accident has occurred have not taken place "when the accident occurred". Sulan J said75, with reference to this Court's decision in Jaensch v "The common law has recognised the facts constituting a road accident are not confined to the immediate point of impact and include the events at the scene after its occurrence, including the extraction and treatment of the injured." It may be noted that the same point was made in relation to the common law in the passage excerpted from the reasons in Hoinville-Wiggins77 cited above; but Sulan J went on to say78 that, although s 53(1)(a) of the Act does not refer to the aftermath of the accident, it should not be construed as abrogating the common law doctrine that presence at the aftermath of an accident may found a 73 Philcox v King (2014) 119 SASR 71 at 81 [30] per Gray J, 90 [68] per Sulan J, 90 74 Philcox v King (2014) 119 SASR 71 at 77 [22]. 75 Philcox v King (2014) 119 SASR 71 at 86 [55]. 76 (1984) 155 CLR 549. 77 (1999) 29 MVR 169 at 173 [23]. 78 Philcox v King (2014) 119 SASR 71 at 88 [60]. claim for damages for mental harm. Sulan J reasoned79 that because the Act defined "motor accident" to mean "an incident", and because "an incident" is, according to Roget's Thesaurus, "synonymous with an event, eventuality or aftermath", the term "motor accident" as used in the Act was "broad enough to encompass the events directly related to and following on from the actual impact [of the vehicles]." On this basis, his Honour concluded80 that in the case of a motor accident "[p]resence at the aftermath of an accident, as that phrase is understood by the common law, is sufficient to satisfy s 53(1)(a)." While it is true that the common law has recognised that a plaintiff's presence at the aftermath of an accident may found a claim for damages for mental harm, the plain intention of s 53(1)(a) of the Act is to deny the recovery of damages to persons who in those circumstances would have been entitled to recover damages for mental harm. Legislative measures which deny the remedy of damages in certain cases of negligently inflicted personal injury are now familiar measures, taken in the public interest to preserve the general availability of the remedy by ensuring the viability and affordability of arrangements to meet the costs involved: such measures should not be given an artificially narrow operation81. Given the unmistakable intention of s 53(1)(a) of the Act to cut back common law rights on a selective basis, it would be out of place to insist upon an artificial construction in order to preserve common law rights. As was said by Gleeson CJ, Gaudron, Gummow, Hayne and Callinan JJ in Australian Securities and Investments Commission v DB Management Pty Ltd82: "It is of little assistance, in endeavouring to work out the meaning of parts of [a legislative] scheme, to invoke a general presumption against the very thing which the legislation sets out to achieve." In any event, it is to strain too far against the plain meaning of the language of s 53(1)(a) of the Act to say that "an incident" is "synonymous" with its aftermath. Like s 77(a)(ii) of the MAA, considered in Hoinville-Wiggins, s 53(1)(a) of the Act requires, in plain language, presence at the scene "when the accident occurred". This requirement may have unattractive consequences. For example, rescuers, such as the plaintiff in Hoinville-Wiggins, may be denied 79 Philcox v King (2014) 119 SASR 71 at 90 [65]-[66]. 80 Philcox v King (2014) 119 SASR 71 at 90 [68]. 81 Gifford v Strang Patrick Stevedoring Pty Ltd (2003) 214 CLR 269 at 284 [36]; [2003] HCA 33; Electrolux Home Products Pty Ltd v Australian Workers' Union (2004) 221 CLR 309 at 328-329 [19]; [2004] HCA 40; Daly v Thiering (2013) 249 CLR 381 at 392 [32]-[33]; [2013] HCA 45. 82 (2000) 199 CLR 321 at 340 [43]; [2000] HCA 7. recovery of damages for serious psychological or psychiatric injury. But the amelioration of that state of affairs, which itself is a consequence of legislative action, is properly a matter for the legislature. In this regard, it is important to note the difference between s 53(1)(a) of the Act and the terms of the legislation under consideration in Wicks v State Rail Authority (NSW)83. In that case, this Court was concerned, not with s 77(a)(ii) of the MAA, but with s 30(2)(a) of the Civil Liability Act 2002 (NSW), which provided that a plaintiff is not entitled to recover damages for pure mental harm unless "the plaintiff witnessed, at the scene, the victim being killed, injured or put in peril". The plaintiffs were policemen who suffered psychiatric injuries arising from their attendance at the scene of a passenger train derailment in which passengers were injured and killed. They attempted to rescue passengers on the train who had survived the accident. Passengers suffered physical and psychiatric injury as they were removed from the train. The survivors of the derailment remained in peril of further injury until they were removed from the train to a place of safety. This Court held that s 30(2)(a) did not preclude recovery of damages for the mental harm that the plaintiffs suffered because the plaintiffs had witnessed, at the scene, victims of the accident being injured or put in peril over the period while they were attempting to rescue them84. For present purposes, it is important to note that the Court said85: "It would not be right, however, to read s 30, or s 30(2)(a) in particular, as assuming that all cases of death, injury or being put in peril are events that begin and end in an instant, or even that they are events that necessarily occupy only a time that is measured in minutes. No doubt there are such cases. But there are cases where death, or injury, or being put in peril takes place over an extended period. This was such a case". These observations have no application to the present case. Nor do they entail any criticism of the decision in Hoinville-Wiggins. Indeed, there was no occasion for this Court in Wicks to refer to Hoinville-Wiggins. That is because the legislation under consideration in Wicks did not require that the plaintiffs be present at the scene of the accident "when the accident occurred" in order to recover damages for mental harm; it rather required the plaintiffs to have witnessed, at the scene of the accident, victims "being put in peril". That 83 (2010) 241 CLR 60; [2010] HCA 22. 84 (2010) 241 CLR 60 at 76-77 [45]-[52]. 85 (2010) 241 CLR 60 at 76 [44]. difference in the statutory language was of critical importance to the conclusion in Wicks and the observations cited above. Present at the scene Section 53(1) of the Act provides that only two categories of person are entitled to recover damages for negligently inflicted mental harm: persons who were injured in the accident or present at the scene of the accident when it occurred; and persons who, though they were not injured in the accident or present at the scene of the accident when it occurred, were in a specified relationship to a person killed, injured or endangered in the accident. Persons who have suffered negligently inflicted mental harm, but who were not in a specified relationship with a person killed, injured or endangered in the accident, and who were not present at the scene of the accident when it occurred, are excluded from recovering damages even if the circumstances of the accident involved a breach of a duty of care owed to them by the defendant and the occurrence of the accident had some causal connection with the mental harm suffered. In the present case, the respondent was not, in the relevant sense, "present at the scene" at any time. The Oxford English Dictionary defines the word "present", as it relates to places, in a number of senses: one sense is "Beside, before, with, or in the same place as the person who or thing which is the point of reference"; another, less frequently used, sense is "Having the mind, thought, etc, focused on or closely engaged with what one is doing; attentive, alert, aware (opposed to 'absent')". This latter sense is pertinent to the operation of s 53(1)(a) of the Act. The requirement of presence at the scene is not, as the respondent argued, an arbitrary limit upon the recovery of damages to be strictly confined in its effect. Rather, it is a limitation upon the recovery of damages which reflects an intelligible legislative choice to limit the extent of liability for the consequences of a defendant's negligence. The exclusion of liability effected by s 53(1)(a) of the Act is an informed and rational response to issues thrown up by the case law86 as to where the law should best draw the line to limit indeterminate liability and unreasonable or disproportionate burdens upon defendants and those who are obliged, under private or public insurance arrangements, to defray the cost of meeting those burdens. The exclusion reflects a balancing of interests87, the 86 Chester v Waverley Corporation (1939) 62 CLR 1 at 44; [1939] HCA 25; Mount Isa Mines Ltd v Pusey (1970) 125 CLR 383 at 411; [1970] HCA 60; Jaensch v Coffey (1984) 155 CLR 549 at 564-570, 590-591; Alcock v Chief Constable of South Yorkshire Police [1992] 1 AC 310 at 400-405; Tame v New South Wales (2002) 211 CLR 317 at 381 [192]; [2002] HCA 35. 87 cf Alcock v Chief Constable of South Yorkshire Police [1992] 1 AC 310 at 400-405. rationale of which is readily intelligible. Arguments as to whether the line drawn by the legislation accords with the latest stage in the ongoing development88 of the common law by the courts are beside the point; it is wrong to characterise the exclusionary line drawn by the legislation as arbitrary, so as to justify reading the expression "present at the scene" as meaning no more than in the same place as the accident. The language in which the legislative choice made by s 53(1)(a) has been expressed can be seen to be informed by the discussion in Jaensch v Coffey89. The requirement of presence at the scene of the accident as a condition for the recovery of damages for mental or nervous shock was first adopted by legislation in South Australia in 1986 by the insertion of s 35A into what was then called the Wrongs Act 1936 (SA). In the Attorney-General's Second Reading Speech for the Bill90 that introduced this predecessor to s 53(1)(a) of the Act, specific reference was made to the decision of the Full Court of the Supreme Court of South Australia in Coffey v Jaensch91, affirmed by this Court in Jaensch v Coffey. It is evident from the separate reasons of Gibbs CJ, Brennan, Deane and Dawson JJ in Jaensch v Coffey92 that their Honours spoke of a plaintiff's presence at the scene of an accident as a natural way of referring to the plaintiff's personal experience of seeing and hearing the sights and sounds of the accident. Section 53(1)(a) proceeds on the same basis. The balance struck by s 53(1)(a) of the Act treats mental harm by way of reaction to a report of an accident as too remote to be compensable, unless the plaintiff was in one of the relationships with the victim specified in s 53(1)(b) of the Act. Plaintiffs who are in a specified relationship to a person injured in the accident may recover damages for mental harm as a consequence of a report of the accident. Plaintiffs not in such a relationship may recover only if their mental harm is a consequence of presence at the scene, understood as involving an awareness of the accident from direct personal experience. The balance so struck recognises that the social utility of an award of damages (whether as compensation to the plaintiff or as an incentive to the adoption of higher safety standards within the community) diminishes as the causal connection between 88 Tame v New South Wales (2002) 211 CLR 317 at 390-394 [214]-[225]; Gifford v Strang Patrick Stevedoring Pty Ltd (2003) 214 CLR 269 at 275-276 [7]. 89 (1984) 155 CLR 549. 90 South Australia, Legislative Council, Parliamentary Debates (Hansard), 27 November 1986 at 2410. 91 (1983) 33 SASR 254. 92 (1984) 155 CLR 549 at 551-552, 564, 590-597, 612. negligent conduct and the onset of mental harm in the plaintiff becomes more attenuated93. In summary, on this aspect of the case, one must conclude that, when s 53(1)(a) of the Act speaks of presence at the scene of an accident, it is speaking of the scene presented to the sight and hearing of the person claiming damages for mental harm caused by the accident. In this case, the respondent was not directly exposed to the sights and sounds of the accident. Although it may be said that the accident was causally related to the mental harm from which he suffered, that harm was not the result of direct exposure to the sights and sounds of the accident. Accordingly, the respondent's mental harm was, by reason of s 53(1)(a) of the Act, too remote from the appellant's negligent driving to be compensable. Conclusion and orders The appeal should be allowed. Paragraphs 1 and 3.1, and par 2 insofar as that paragraph relates to the setting aside of the judgment appealed against, of the order made by the Full Court should be set aside. In their place it should be ordered that the appeal to the Full Court is dismissed. Because of the conditions on which special leave to appeal was granted, the appellant must pay the respondent's costs of the appeal to this Court and the order for costs made by the Full Court should not be disturbed. 93 Jaensch v Coffey (1984) 155 CLR 549 at 590-591; Tame v New South Wales (2002) 211 CLR 317 at 404 [254]. Nettle NETTLE J. The appellant was the driver of a motor car which was involved in an accident at an intersection in Campbelltown, Adelaide between 4:50pm and 4:55pm on 12 April 2005. The respondent's brother was a passenger in the car and sustained serious injuries as a result of the force of the impact. He died as a result of his injuries at about 5:30pm while still trapped in the car. The intersection was one through which the respondent frequently drove. On the afternoon of 12 April 2005, shortly after the collision occurred, he drove through it or turned left at it on five separate occasions; each time unaware that his brother was a passenger in one of the vehicles involved in the collision and had been fatally injured. On the first occasion, the respondent noticed that the accident had occurred but did not think that anyone had been seriously injured. There were others assisting and so he decided to drive on. At that stage, it is likely that the respondent's brother, although fatally injured, was still alive trapped in one of the vehicles which had collided. On the second occasion, which was sometime between 5:00pm and 5:30pm, the respondent noticed the presence of police and emergency vehicles but, once again, he did not pay a great deal of attention to what was occurring. His girlfriend, who was with him, did not recognise either of the vehicles which had collided. On the third occasion, which was probably about 20 minutes later again, the respondent did not notice anything specific. He saw vehicles but did not focus on them. On the fourth occasion, more than 30 minutes later again, the scene had "been pretty much cleared" but the respondent noticed a blue or grey station wagon on a flatbed tow truck with severe damage to the passenger side and, at that point, he realised that the car was far more seriously damaged than he had earlier thought. He could see that it had been cut open and, because of the extent of the damage, that someone had been horrifically hurt or killed. On the fifth occasion, the scene had been cleared. Later that evening, between about 10:30pm and 11:00pm, the respondent's parents told him that his brother had been killed in a motor accident. He thereupon made the connection with what he had seen at the intersection earlier in the day and was devastated by the thought that, although he had been present, he had not known that his brother was involved and had not stopped to help. Later, in the early hours of the morning, he returned to the intersection and spent some hours there, angry at himself for having been at the intersection and not knowing of his brother's involvement: "angry, guilty for not knowing, not stopping". Nettle The respondent suffered distress and grief which had an ongoing impact on his personal and professional life. Based on expert psychological and psychiatric evidence, it was accepted that he had suffered mental harm comprised of a recognised psychiatric illness in the nature of a major depressive disorder with significant anxiety-related components of a post-trauma stress reaction. Subsequently, he brought proceedings against the appellant in the District Court of South Australia for damages for mental harm. Relevant legislation Section 33 of the Civil Liability Act 1936 (SA) ("the CL Act") controlled the extent of the duty of care to avoid causing mental harm. It provided: "33—Mental harm—duty of care (1) A person (the defendant) does not owe a duty to another person (the plaintiff) to take care not to cause the plaintiff mental harm unless a reasonable person in the defendant's position would have foreseen that a person of normal fortitude in the plaintiff's position might, in the circumstances of the case, suffer a psychiatric illness. For the purposes of this section— in a case of pure mental harm, the circumstances of the case to which the court is to have regard include the following: whether or not the mental harm was suffered as the result of a sudden shock; (ii) whether the plaintiff witnessed, at the scene, a person being killed, injured or put in peril; (iii) the nature of the relationship between the plaintiff and any person killed, injured or put in peril; (iv) whether or not there was a pre-existing relationship between the plaintiff and the defendant; in a case of consequential mental harm, the circumstances of the case include the nature of the bodily injury out of which the mental harm arose. This section does not affect the duty of care of a person (the defendant) to another (the plaintiff) if the defendant knows, or ought reasonably to know, that the plaintiff is a person of less than normal fortitude." Nettle "Mental harm" was defined in s 3 of the CL Act as follows: "mental harm means impairment of a person's mental condition". Section 53 of the CL Act restricted the class of persons who may recover damages for mental harm, thus: "53—Damages for mental harm (1) Damages may only be awarded for mental harm if the injured person— (a) was physically injured in the accident or was present at the scene of the accident when the accident occurred; or is a parent, spouse or child of a person killed, injured or endangered in the accident. (2) Damages may only be awarded for pure mental harm if the harm consists of a recognised psychiatric illness. (3) Damages may only be awarded for economic loss resulting from consequential mental harm if the harm consists of a recognised psychiatric illness." The proceedings below At first instance, the judge found that the respondent suffered mental harm as a result of sudden shock caused by being told of his brother's death and thus a "sudden and disturbing impression on the mind or feelings"94 within the meaning of s 33(2)(a)(i). The judge also concluded that a reasonable person in the appellant's position would have foreseen that a person of normal fortitude in the respondent's position might, in the circumstances of the case, suffer a psychiatric illness as a result of the sudden shock upon seeing or hearing of his brother's death. It followed, the judge held, that the appellant owed the respondent a duty to take reasonable care not to cause him mental harm. The judge then went on to consider the application of s 53. Her Honour accepted, or at least was prepared to assume, that "accident" for the purposes of the section includes the aftermath of an accident. But she reasoned that, in order 94 See Wicks v State Rail Authority (NSW) (2010) 241 CLR 60 at 72-73 [30] per curiam; [2010] HCA 22. Nettle to be "present" at the scene of an accident when the accident occurs within the meaning of s 53(1)(a), a claimant has to "witness" the accident or at least the recovery or rescue following the accident. The respondent did not "witness" the accident or the recovery or rescue because he was not aware when he passed through the intersection that his brother had been killed, injured or put in peril and did not observe anyone else being killed, injured or put in peril. Accordingly, the respondent's claim failed. In case that conclusion were wrong, the judge considered whether, in any event, the respondent's injuries were caused by the appellant's negligence. The judge found as a matter of fact that the respondent's mental harm was caused by what his parents told him of his brother's death – as opposed to anything he had seen at the intersection – and, therefore, that there was no causal link between the mental harm and what the respondent had seen of the aftermath of the accident. On that basis, the judge concluded that, even if s 53(1)(a) were satisfied, the respondent's claim would still have failed. On appeal to the Full Court of the Supreme Court, Gray J95, with whom Sulan and Parker JJ agreed96, upheld the trial judge's determination that the appellant owed the respondent a duty of care. Like the judge, Gray J considered it was reasonably foreseeable that a person coming upon the scene of the collision, including its aftermath, would suffer mental harm on hearing of his or her sibling's death. The Full Court, however, reversed the judge's finding that what the respondent saw of the aftermath of the accident was not causative of his mental harm. Gray J was satisfied97 that there was "a direct temporal link between the motor vehicle accident death and the development of the condition, in that the latter developed directly after the former" and "a causal relationship in that [the respondent's] condition focuses directly upon the psychological traumas related to the fatal motor vehicle accident"98. The Full Court were further of the opinion that "presence at the aftermath of an accident" as that phrase is understood by the common law is sufficient to satisfy s 53(1)(a) and, therefore, that the respondent was present at the scene of 95 Philcox v King (2014) 119 SASR 71 at 77 [20]. 96 Philcox (2014) 119 SASR 71 at 83 [46] per Sulan J, 90 [70] per Parker J. 97 Philcox (2014) 119 SASR 71 at 83 [44]. 98 Philcox (2014) 119 SASR 71 at 82 [37] (emphasis removed). Nettle the accident when the accident occurred within the meaning of the provision99. Thus, the appeal was allowed. Grounds of appeal The appeal to this Court was put on the basis that both the judge at first instance and the Full Court erred in holding that the appellant owed the respondent a duty to take reasonable care to avoid causing the respondent mental harm; and that the Full Court erred in holding that the respondent was present at the scene of the accident when the accident occurred within the meaning of s 53(1)(a). There was no ground of appeal against the Full Court's finding of fact that the respondent's mental condition was caused by what he observed at the scene of the accident on the five occasions that he passed by. Counsel for the appellant referred to the issue in the course of argument and referred to some of the evidence as if the Full Court's finding should be doubted. But he did not seek to amend the grounds of appeal or otherwise to take the matter further. Duty of care Like s 32 of the Civil Liability Act 2002 (NSW) ("the NSW Act"), which was considered by this Court in Wicks v State Rail Authority (NSW)100, s 33 of the CL Act defines or controls what would otherwise be a duty of care arising at common law but it does not positively identify when the duty arises. It provides that foreseeability is a necessary condition for a duty of care to arise101. It then delineates four kinds of circumstances to which regard should be had in the identification of a duty of care102. But it does not prescribe particular consequences flowing from those circumstances103. the presence or absence of any of Similarly, like s 32 of the NSW Act, s 33 of the CL Act is to be understood against the background of the common law of negligence relating to psychological injury. It reflects and in part responds to the state of the law which 99 Philcox (2014) 119 SASR 71 at 77 [22]-[23], 81 [29]-[30] per Gray J, 90 [68] per Sulan J, 90 [70] per Parker J. 100 (2010) 241 CLR 60. 101 CL Act, s 33(1). 102 CL Act, s 33(2)(a). 103 See Wicks (2010) 241 CLR 60 at 71 [22]-[23]. Nettle had developed by the time of its enactment: that the notions of "normal fortitude", "shocking event" and "directness of connection" were no longer conditions of liability but rather considerations relevant to the centrally determinative issue of foreseeability104. In contradistinction, however, to the common law of negligence, s 33 of the CL Act denies the existence of a duty of care unless it is foreseeable that a person of normal fortitude might, in the circumstances of the case, suffer a psychiatric illness105. It should also be noticed that, in contrast to the comparable expression "mental or nervous shock" which appears in the NSW Act106, the natural and ordinary meaning of "mental harm" as defined in s 3 of the CL Act is not in terms restricted to something in the nature of a sudden and disturbing adverse mental impact. It may include adverse mental conditions which develop over time. It follows, as was pointed out in Wicks107, that in cases like this there are three aspects of provisions like s 33 which are important. First, although a "sudden shock" suffered by the plaintiff is a circumstance which may bear on the recognition of a duty, it is neither a necessary nor a sufficient condition of duty. Secondly, witnessing at the scene a person being killed, injured or put in peril, although relevant, is not a necessary or sufficient condition of duty. Thirdly, because "mental harm" is defined108 for the purposes of the section as "impairment of a person's mental condition", it means something different from the "sudden shock" which is referred to in s 33(2)(a)(i). Foreseeability alone, however, is not enough. Section 33(1) does not displace the common law imperative that "reasonable foreseeability" be understood and applied bearing in mind that it is bound up with the question of whether it is reasonable to require a person to have in contemplation the risk of 104 Tame v New South Wales (2002) 211 CLR 317 at 332-333 [16]-[18] per Gleeson CJ, 340-341 [51]-[52], 343-344 [61]-[62], [66] per Gaudron J, 384 [199], 390 [213], 393 [221]-[222], 394 [225] per Gummow and Kirby JJ, 411-412 [275] per Hayne J; [2002] HCA 35. 105 See Wicks (2010) 241 CLR 60 at 72 [26]. 106 NSW Act, ss 29-30. 107 (2010) 241 CLR 60 at 72 [27]-[29]. 108 CL Act, s 3. Nettle injury that has eventuated. As Gleeson CJ observed in Tame v New South Wales109: "What a person is capable of foreseeing, what it is reasonable to require a person to have in contemplation, and what kinds of relationship attract a legal obligation to act with reasonable care for the interests of another, are related aspects of the one problem. The concept of reasonable foreseeability of harm, and the nature of the relationship between the parties, are both relevant as criteria of responsibility." This Court has not before had to determine whether a duty of care is owed in the circumstances presented by this case. Wicks made passing reference to the issue of duty of care owed to those present at the aftermath of an accident but did not deal with it in detail110. Jaensch v Coffey111, Tame and Gifford v Strang Patrick Stevedoring Pty Ltd112 all provide relevant guidance, but the issue cannot be properly decided by reference only to the nature of the relationship between the victim of an accident and the claimant, or the victim and the defendant. As Deane J concluded in Jaensch113, the question of whether a duty of care is owed in particular circumstances falls to be resolved by a process of legal reasoning, by induction and deduction by reference to the decided cases and, ultimately, by value judgments of matters of policy and degree. Although the concept of "proximity" that Deane J held to be the touchstone of the existence of a duty of care114 is no longer considered determinative, it nonetheless "gives focus to the inquiry"115. It does so by directing attention towards the features of the relationships between the parties and the factual circumstances of the case, and prompting a "judicial evaluation of the factors which tend for or against a conclusion"116 that it is reasonable (in the sense spoken of by Gleeson CJ in 109 (2002) 211 CLR 317 at 331 [13]; see also at 379 [185] per Gummow and Kirby JJ, 410 [272] per Hayne J. 110 (2010) 241 CLR 60 at 73-75 [33]-[39]. 111 (1984) 155 CLR 549; [1984] HCA 52. 112 (2003) 214 CLR 269; [2003] HCA 33. 113 (1984) 155 CLR 549 at 585. 114 Jaensch (1984) 155 CLR 549 at 584-585. 115 Sullivan v Moody (2001) 207 CLR 562 at 578-579 [48] per Gleeson CJ, Gaudron, McHugh, Hayne and Callinan JJ; [2001] HCA 59. 116 Sullivan v Moody (2001) 207 CLR 562 at 580 [50]. Nettle Tame117) for a duty of care to arise. That these considerations may be tempered or assisted by policy considerations and value judgments is not, however, an invitation to engage in "discretionary decision-making in individual cases"118. Rather, it reflects the reality that, although "[r]easonableness is judged in the light of current community standards"119, and the "totality of the relationship[s] between the parties"120 must be evaluated, it is neither possible nor desirable to state an "ultimate and permanent value"121 according to which the question of when a duty arises in a particular category of case may be comprehensively answered. As it happens, in this case, each of the considerations identified by Deane J in Jaensch points in favour of the recognition of a duty of care. Foreseeability The threshold inquiry mandated by s 33(1) is whether a reasonable person in the defendant's position would have foreseen that a person of normal fortitude in the plaintiff's position might suffer a psychiatric illness. The reference to a person in the "position" of the plaintiff is to the class of persons of which the plaintiff is a member122, not necessarily the particular plaintiff. Approaching the matter in the first place as one of common sense and ordinary human experience, there can surely be little doubt that it is reasonably foreseeable that close relatives of a motor accident victim might be at, or later come to the aftermath of, the accident. Most often, if such a relative is not already at the scene of the accident, he or she might go to the aftermath having been told of what has occurred or otherwise to see what has occurred. If so, as Jaensch shows, it is reasonably foreseeable that a person of normal fortitude in that situation might suffer mental 117 (2002) 211 CLR 317 at 331 [13]. 118 Sullivan v Moody (2001) 207 CLR 562 at 579 [49]. 119 Tame (2002) 211 CLR 317 at 332 [14] per Gleeson CJ; see also at 379 [185] per Gummow and Kirby JJ, 410 [272] per Hayne J. 120 Graham Barclay Oysters Pty Ltd v Ryan (2002) 211 CLR 540 at 596 [145] per Gummow and Hayne JJ; [2002] HCA 54. 121 Vairy v Wyong Shire Council (2005) 223 CLR 422 at 445 [67] per Gummow J; [2005] HCA 62. 122 Sutherland Shire Council v Heyman (1985) 157 CLR 424 at 487 per Brennan J; [1985] HCA 41. Nettle harm as the result of what he or she there sees or otherwise learns of the plight of the victim. It is perhaps less likely that a close relative of a motor accident victim may fortuitously stumble upon the aftermath of the accident, as occurred here; and, in that sense, it is less likely that a close relative of the victim might suffer mental harm by stumbling across the aftermath. That does not mean, however, it is any less reasonably foreseeable that a close relative who stumbles upon the aftermath of an accident might suffer mental harm as a consequence. For once it is accepted that it is reasonably foreseeable that a close relative of a motor accident victim might suffer mental harm as a consequence of what he or she sees and learns at the aftermath of the accident, it is beside the point that, in a given case, such a close relative may happen upon the scene of the aftermath in a statistically unlikely manner. Subject to considerations of reasonableness remaining to be mentioned, it is enough that it is reasonably foreseeable that a close relative may arrive at the aftermath of the accident and suffer mental harm to recognise the existence of a duty to take reasonable care to guard against such close relatives suffering mental harm. Other considerations In terms of induction, the considerations which emerge from the decided cases include whether the mental condition to be guarded against is limited to a condition in the nature or the result of a sudden nervous shock123; whether it is limited to mental harm suffered as the result of presence at the scene of the accident or its aftermath124; any pre-existing relationships between the defendant and the victim and the defendant and the plaintiff125; and the nature of the relationship between the victim and the plaintiff126. In effect, they are the considerations adumbrated in s 33 of the CL Act, on which the trial judge based her decision, and, although s 33 does not purport to be an exhaustive prescription of relevant considerations, it is not suggested that there are any others which arise from the facts of this case. 123 See Tame (2002) 211 CLR 317 at 386-390 [204]-[213] per Gummow and Kirby JJ. 124 Jaensch (1984) 155 CLR 549. 125 Annetts v Australian Stations Pty Ltd, reported with Tame (2002) 211 CLR 317 at 337 [37] per Gleeson CJ, 341 [54] per Gaudron J, 367 [144] per McHugh J, 398 [239]-[240] per Gummow and Kirby JJ, 419 [304] per Hayne J. 126 Gifford (2003) 214 CLR 269 at 288-290 [47]-[50] per McHugh J. Nettle In terms of deduction, there is little in point of principle to distinguish between this case and Jaensch. In Jaensch it was recognised that the causal proximity between a motor accident which caused physical injury to a victim and the psychiatric injury suffered by the victim's wife when she later learned of and saw some of the effects of the physical injury was such that a duty was owed to the victim's wife to take reasonable care to guard against the kind of mental harm which she suffered127. Here, the causal proximity between the motor accident and the respondent's mental harm is comparable to, if not closer than, that in Jaensch. In this case, the respondent was present at the scene of the accident in the aftermath of the accident and, although he was not then aware of his brother's involvement, his presence at the scene of the accident was later determined to have been causative of his condition. In terms of the relationship between the deceased and the claimant, although the relationship between siblings might be presumed not to be as close as it is between husband and wife, the ordinary expectation as to ties between siblings makes it just as foreseeable that the death of one brother could impact severely on the mental health of the other as it is that the death of a husband may impact upon the mental health of his wife128. In terms of contemporary standards of liability and responsibility, it is not unreasonable that a driver should have in contemplation not only an accident victim who suffers physical injury caused by the driver's negligence but also a close relative of the victim, such as a sibling, who might suffer mental harm the result of what he or she sees and learns of the victim's physical injuries in the aftermath of the accident. As has been recognised or assumed by courts in the United Kingdom129, Canada130 and the United States131 and in some States in Australia132, such a relative is a person who is so closely and directly affected by 127 Jaensch (1984) 155 CLR 549 at 606-609. 128 Gifford (2003) 214 CLR 269 at 288-290 [47]-[51] per McHugh J. 129 Turbyfield v Great Western Railway Company (1937) 54 TLR 221; Owens v Liverpool Corporation [1939] 1 KB 394; Mortiboys v Skinner (The "Devonshire Maid") [1952] 2 Lloyd's Rep 95 at 103. 130 Cameron v Marcaccini (1978) 87 DLR (3d) 442. 131 Dillon v Legg 441 P 2d 912 (Cal 1968). 132 See, eg, Storm v Geeves [1965] Tas SR 252; Benson v Lee [1972] VR 879. Nettle the driver's negligence that the driver should have them in contemplation as potentially so affected133. Much was made in argument of what was said to be an essential difference between Jaensch and this case – that the respondent in this case did not see any of the victim's injuries whereas in Jaensch the claimant was both told and observed something of the victim's injuries in the aftermath of the accident at the hospital to which the victim was taken134. But, as has been seen, the respondent in this case did see something of the aftermath of the accident and something of the substantial damage that resulted. He realised at that time that someone was likely to have been at least seriously injured. He later came to understand and was affected by the realisation that his brother had died at a time when he was present. Certainly there are some differences but, in terms of physical and temporal proximity, those differences are neither substantial nor particularly significant. As the decided cases show, the requisite degree of temporal proximity as between accident and mental harm need not be as close as it might in the absence of a close or any relationship between accident victim and claimant135. Furthermore, this case may appropriately be characterised as one where the claim is based on "direct perception of some of the events which go to make up the accident as an entire event [including] the immediate aftermath"136 or where psychiatric injury results from the combined effect on a claimant of a report of an accident and the claimant's later observation of the aftermath137. In Tame, Gleeson CJ expressed concern as to the effects on the way people conduct their lives of imposing legal responsibility to have in contemplation and guard against emotional disturbance to others138. In that connection, his Honour referred to the increasing awareness in the medical profession and in the community generally of the emotional fragility of some 133 Gifford (2003) 214 CLR 269 at 277 [12] per Gleeson CJ, 300 [86] per Gummow and Kirby JJ; Donoghue v Stevenson [1932] AC 562 at 580 per Lord Atkin. 134 (1984) 155 CLR 549 at 558-559 per Brennan J. 135 Jaensch (1984) 155 CLR 549 at 555 per Gibbs CJ; Pham v Lawson (1997) 68 SASR 124 at 144, 148 per Lander J; see also Annetts, reported with Tame (2002) 211 CLR 317; Gifford (2003) 214 CLR 269. 136 Benson v Lee [1972] VR 879 at 880 per Lush J. 137 See Storm v Geeves [1965] Tas SR 252 at 267 per Burbury CJ. 138 (2002) 211 CLR 317 at 332 [14]. Nettle people and the consequent incidence of clinical depression resulting from emotional disturbances. He added that requiring persons engaged in certain kinds of activity to have in contemplation the risk of clinical depression so caused might be extremely onerous, especially if the predictability of harm were the sole criterion of liability. As his Honour also said, considerations of that kind go to the issue of reasonableness, "which is at the heart of the law of negligence"139. Reasonableness must be judged in light of contemporary social conditions and community standards, to which conceptions of legal responsibility need constantly to adapt. Arguably, similar considerations apply here. It was submitted on behalf of the appellant that to recognise a duty of care to a sibling of a motor accident victim when the sibling did not see or hear the accident, and did not until later comprehend that the victim had died, would be to go beyond the bounds of proximity repeatedly emphasised in earlier decisions of this Court. It would place an unreasonable burden on human activity by requiring people to guard against all kinds of psychiatric injury suffered as a consequence of learning, after the event, of the death or serious injury of a relative. There are, however, a number of reasons why that submission should be rejected. To begin with, albeit at the risk of repetition, the respondent did see something of the aftermath of the accident. As has been observed, the only real difference between this case and Jaensch in that respect is that here the respondent did not realise until later told of his brother's death that what he had witnessed at the scene of the accident was his brother trapped dying in the wreckage. Secondly, as has also been noted, where the relationship between a claimant and the victim of physical injuries is close, reasonable foreseeability does not require the same degree of temporal and physical proximity between accident and inception of mental harm as where the relationship is more remote. Thirdly, on the facts as found by the Full Court, there was "a direct temporal link between the motor vehicle accident death and the development of the condition ... [and] a causal relationship in that [the respondent's] condition focuses directly upon the psychological traumas related to the fatal motor vehicle accident"140. There was no appeal against that finding. Fourthly, judged by reference to contemporary social conditions and community standards of what is reasonable, the sort of psychological injury likely to be suffered by a claimant by reason of being exposed to the aftermath of 139 Tame (2002) 211 CLR 317 at 332 [14]. 140 Philcox (2014) 119 SASR 71 at 82 [37] (emphasis removed). Nettle a motor accident in which his or her sibling has been killed is surely much more serious, and so worthy of compensation, than the relatively idiosyncratic strain of mental disorder which it was claimed in Tame had resulted from the unintended and transitory publication of misinformation concerning the level of the plaintiff's blood alcohol concentration141. Fifthly, in seeking to distinguish this case from previous cases in which a duty of care has been found to be owed to the relatives of a victim, counsel for the appellant submitted that in Gifford and Annetts v Australian Stations Pty Ltd142 a duty of care arose because the defendant in each case was the victim's employer, and there was no such employment relationship in this case. That submission overlooks that the duty of care owed by a driver to a passenger is an established category of duty that arises from the relationship between the parties, just as does the duty owed by an employer to an employee. In point of principle, there is no relevant distinction between cases in which a duty of care arises because of an employment relationship between the defendant and the victim and a case like this where the duty arises because of a relationship of driver and passenger between the defendant and the victim. Sixthly, counsel for the appellant submitted that it was essential for this Court to identify "control mechanisms" limiting the scope of the duty of care to avoid causing mental harm, in order to avoid the spectre of indeterminate liability. But, in circumstances where, as here, the legislature has enacted restrictions on the scope of liability in the form of s 53 of the CL Act, it is not apparent why the Court should, as a matter of common law, impose additional or different limitations within the rubric of duty of care. Finally, and by no means least, to recognise that a motorist in the position of the appellant is under a duty of the kind in question requires no more of the motorist to satisfy the duty than the motorist is already bound to do to satisfy his or her duty of reasonable care to his or her passengers. Counsel for the appellant argued that, even if that be so, to recognise the existence of a duty of care in the present circumstances would be productive of confusion in that a wrongdoer in South Australia is already exposed to a claim for solatium following the negligently caused death of a claimant's spouse or child, and that remedy is expressly intended to compensate the claimant for the anguish and distress associated with the consequences of death. Thus, it was contended, if this new area of liability were recognised, it would result in practical difficulties in distinguishing between the compensable effects of disturbing news and non-compensable grief. 141 (2002) 211 CLR 317 at 397 [233]-[234] per Gummow and Kirby JJ. 142 Reported with Tame (2002) 211 CLR 317. Nettle The supposed risk of confusion is exaggerated. The possibility of confusion of the kind suggested already exists in relation to recognised categories of duty to take reasonable care to avoid causing a claimant psychiatric injury as a consequence of being present at the scene of an accident in which a close relative is killed or seriously injured. So far it has not proved to be a problem and there is not a great deal of reason to suppose that it will. The law will not allow double recovery. Conclusion on duty of care In the result, the Full Court were right to hold that the appellant owed the respondent a duty to take reasonable care in the driving of his vehicle not to cause the respondent mental harm of the kind he suffered. Section 53 of the CL Act As was earlier mentioned, s 53 provided that damages may only be awarded for mental harm if the plaintiff were present at the scene of the accident when the accident occurred. Section 3 defined "accident" as "an incident out of which personal injury arises and includes a motor accident"; and "motor accident" as "an incident in which personal injury arises out of the use of a motor vehicle". In Jaensch143, Deane J identified a distinction at common law between an accident and its aftermath, as follows: "It has already been seen that the requirement of proximity in a case of mere psychiatric injury is satisfied where injury was sustained as a result of observation of matters involved in the aftermath of a road accident at the actual place of collision. The facts constituting a road accident and its aftermath are not, however, necessarily confined to the immediate point of impact. They may extend to wherever sound may carry and to wherever flying debris may land. The aftermath of an accident encompasses events at the scene after its occurrence, including the extraction and treatment of the injured. In a modern society, the aftermath also extends to the ambulance taking an injured person to hospital for treatment and to the hospital itself during the period of immediate post-accident treatment. It would, in my view, be both arbitrary and out of accord with common sense to draw the borderline between liability and no liability according to whether the plaintiff encountered the aftermath of the accident at the actual scene or at the hospital to which the injured person had been quickly taken. Indeed, as has been mentioned, in some cases the true impact of the facts of the 143 (1984) 155 CLR 549 at 607-608. Nettle accident itself can only occur subsequently at the hospital where they are known. In the present case, as in McLoughlin, the aftermath of the accident extended to the hospital to which the injured person was taken and persisted for so long as he remained in the state produced by the accident up to and including immediate post-accident treatment. Mrs Coffey sustained her psychiatric injury by reason of what she saw and heard at the hospital while her husband was under such treatment. Her psychiatric injuries were the result of the impact upon her of the facts of the accident itself and its aftermath while she was present at the aftermath of the accident at the hospital. That being so, she was not, in my view, precluded from recovering damages for those injuries by reason of the fact that she did not attend at the actual scene of the collision. What, then, is the effect of the fact that her nervous shock was caused by what she was told, as well as by what she observed, at the hospital?" In this case, counsel for the appellant contended that, given the distinction between "accident" and "aftermath" so recognised at common law, the fact that the definition of "accident" in s 3 makes no reference to "aftermath" implies that s 53(1) limits the recovery of damages for mental harm suffered as a result of an accident to a claimant who was present at the scene of impact at the time it occurred. Counsel referred to the decision of the New South Wales Court of Appeal in Hoinville-Wiggins v Connelly144, which concerned the meaning of "when the accident occurred" in s 77 of the Motor Accidents Act 1988 (NSW) ("the NSW Motor Accidents Act"), as supporting that conclusion. For the reasons which follow, that argument should be accepted. "Accident" does not include the aftermath of an accident Section 77 of the NSW Motor Accidents Act provided as follows: "No damages for psychological or psychiatric injury shall be awarded in respect of a motor accident except in favour of: a person who suffered injury in the accident and who: was the driver of or a passenger in or on a vehicle involved in the accident, or (ii) was, when the accident occurred, present at the scene of the accident, or 144 (1999) 29 MVR 169; [1999] NSWCA 263. Nettle a parent, spouse, brother, sister or child of the injured person or deceased person who, as a consequence of the injury to the injured person or the death of the deceased person, has suffered a demonstrable psychological or psychiatric injury and not merely a normal emotional or cultural grief reaction." In Hoinville-Wiggins, Giles JA, with whom Mason P and Stein JA agreed145, reasoned with respect to that section that146: "Close connection in space and time is required. The words 'when the accident occurred' mean that it is not enough that [the claimant] came to the scene of the accident after the accident had occurred, as might have happened in 'rescuer' cases at common law. The claimant argued that the accident included what she described as its aftermath, and extended to her attendance to minister to the pedestrian. For the notion of aftermath she referred to Benson v Lee; McLoughlin v O'Brian and Jaensch v Coffey. The passages were to do with recovery at common law of damages for nervous shock suffered not only by a plaintiff who saw or heard the accident, but also by a plaintiff who saw or heard events at the scene of the accident after its occurrence or even at a hospital during immediate post-accident treatment. They distinguished between the accident and its aftermath. Section 77 limits this common law position, because the plaintiff must have been present at the scene of the accident and must have been present at the scene of the accident when the accident occurred; the additional requirement that the plaintiff suffer injury in the accident underlines these spatial and temporal requirements. The aftermath was never part of the accident and (at least for the purposes of s 77(a)) seeing or hearing the aftermath no longer founds recovery of damages. On the clear wording of the section, I do not think it can be said that any nervous shock suffered by the claimant from her attending to assist the pedestrian can be said to have been suffered in the accident, and in particular I do not think that it can be said that she was present at the scene of the accident when the accident occurred. The claimant's case in this respect is not assisted, as was argued, if the pedestrian was alive (as shown by the pulse the claimant thought she detected) at an early part of the period of administration of CPR. The accident occurred when the opponent's motor vehicle struck the pedestrian, whether or not the pedestrian's death was immediate, and the claimant's presence in the 145 (1999) 29 MVR 169 at 169 [1], [2]. 146 (1999) 29 MVR 169 at 173 [23]-[24]. Nettle classroom, unaware of the accident until Ms Kelly told her of it, was not presence at the scene of the accident at that time." (citations omitted) The Full Court rejected the appellant's argument that s 53 should be construed in accordance with the reasoning in Hoinville-Wiggins. Gray J, with whom Parker J generally agreed, said that he did so because the common law conception of "accident" includes the aftermath of the accident and therefore it should be assumed that, where the CL Act refers to an "accident", it includes its aftermath147. His Honour did not refer to Hoinville-Wiggins, but said the observations in Wicks concerning s 30 of the NSW Act had "obvious relevance" to the construction of s 53148. Sulan J reasoned differently, albeit to the same conclusion. His Honour said that "[t]he common law has recognised the facts constituting a road accident are not confined to the immediate point of impact and include the events at the scene after its occurrence"149. The legislative history and extrinsic materials relating to s 53 did not disclose a parliamentary intention to abrogate the "aftermath doctrine"150. Further, he said that by defining "accident" as including a "motor accident", and the latter expression as an "incident in which personal injury arises", the CL Act had extended the meaning of "accident" to "encompass the events directly related to and following on from the actual impact"151. His Honour distinguished Hoinville-Wiggins on the basis that the NSW Motor Accidents Act did not contain such a definition of "accident". With respect, the Full Court's reasoning was not correct. According to ordinary acceptation, a motor accident occurs when a motor vehicle collides with another motor vehicle or some other object. Where that occurs, it is the forces generated by the impact or impacts of the collision which inflict a victim's personal injuries. What happens in the aftermath of the collision might result in exacerbated or additional injuries such as, for example, might be sustained by the victim in the course of attempts made to remove him or her from a damaged vehicle or as the result of an unsuccessful medical procedure intended to enhance his or her chances of survival. But it remains that it is the collision or collisions which comprise the relevant incident out of which the victim's injuries arise. 147 Philcox (2014) 119 SASR 71 at 77 [22]. 148 Philcox (2014) 119 SASR 71 at 80 [28]. 149 Philcox (2014) 119 SASR 71 at 86 [55]. 150 Philcox (2014) 119 SASR 71 at 87-88 [58]-[60]. 151 Philcox (2014) 119 SASR 71 at 90 [66]. Nettle Significantly, that is plainly the sense in which the word "accident" is used elsewhere in the CL Act: in s 47, which is concerned with contributory negligence; and in s 49, which is directed to the consequences of an injury suffered in a motor accident where the injured person was not wearing a seatbelt. Contrary to the reasoning of Gray and Sulan JJ, the fact that the common law recognised a distinction between an accident and its aftermath points against the idea that, by defining "accident" without reference to "aftermath", s 3 includes the "aftermath" as part of the "accident". Nor does Wicks assist in the way in which Gray J appears to have considered that it did. Wicks was concerned with the differently worded provisions of s 30 of the NSW Act, in which there was no requirement (as there is in s 53 of the CL Act) that the claimant be present at the scene when the accident occurred. Section 30(2)(a) of the NSW Act provided that a plaintiff was not entitled to recover damages for mental harm unless "the plaintiff witnessed, at the scene, the victim being killed, injured or put in peril". The plaintiffs in Wicks were members of the New South Wales Police Force who attended the scene of a high- speed train accident soon after it occurred. They saw the bodies of dead passengers, as well as passengers who were trapped, evidently seriously injured, and distressed152. This Court held that this constituted witnessing, at the scene, the victims of the accident who were still alive being put in peril153. As submitted by the appellant, s 30 of the NSW Act is directed to what a plaintiff witnesses in terms of harm done to the victim. In contrast, s 53 of the CL Act is directed to the claimant's presence at the scene of the accident at a particular time – being the time "when the accident occurred". Sulan J's interpretation of "incident" in the definitions of "accident" and "motor accident" in s 3 of the CL Act was equally misplaced. The natural and ordinary meaning of "incident" in s 3 is something akin to the second sense of "incident" identified in the Oxford English Dictionary: "[a]n occurrence or event viewed as a separate circumstance"154. There is nothing about that which suggests a legislative intent to expand the ordinary meaning of "accident" to include the aftermath of an accident. Rather, it suggests a legislative intent to 152 Wicks (2010) 241 CLR 60 at 66-67 [1]-[2]. 153 Wicks (2010) 241 CLR 60 at 77 [50]-[51]. 154 The Oxford English Dictionary, 2nd ed (1989), vol VII at 793, "incident", sense 2(a). Nettle confine "accident" to the separate circumstance or event – the impact – out of which personal injury may arise. The likelihood of that being so is fortified by the superadded requirement in s 53(1)(a) that a plaintiff have been present at the scene of the accident when the accident occurred. It conveys the notion of a singular scene of the accident and a singular time at the scene of the occurrence of the accident; and, as such, it stands in contrast to the kind of continuing sequence of incidents during the aftermath of the accident which, in Wicks, was found to be causative of the plaintiffs' mental condition155. Legislative history and extrinsic materials It follows from the above that, to the extent the Full Court relied on historical considerations and extrinsic materials, their Honours did so in such a way as incorrectly to displace the clear meaning of the statutory text, read in its context156. The legislative history of s 53 and the extrinsic materials relating to its enactment and subsequent amendments do not suggest that any different construction than that reached above is warranted. The legislative progenitor of s 53(1) was s 35A(1)(c) of the Wrongs Act 1936 (SA). As enacted in 1986157, it provided that: "[N]o damages shall be awarded for mental or nervous shock except in favour of— a person who was physically injured in the accident, who was the driver of or a passenger in or on a motor vehicle involved in the accident or who was, when the accident occurred, present at the scene of the accident; or a parent, spouse or child of a person killed, injured or endangered in the accident". 155 (2010) 241 CLR 60 at 74 [37], 76 [44]-[48]. 156 Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27 at 46-47 [47] per Hayne, Heydon, Crennan and Kiefel JJ; [2009] HCA 41. 157 Wrongs Act Amendment Act 1986 (SA). Nettle In the second reading speech relating to the amending Bill, the responsible Minister said of the amendment158: "The Bill also provides for limits on the range of persons who will be entitled to make claim for nervous shock. Payments for nervous shock are made where nervous shock is suffered by a person in the proximity of injury or peril caused to a third party by the negligence of another. The law was extended in the 1983 case of Coffey v Jaensch[159] so that it covered the case where a wife suffered nervous shock from what she saw and was told at a hospital on the night of an accident and on the following day. The proposed amendment does not significantly alter the law as it currently stands and ... it recognises the result in the case of Coffey v Jaensch. However, by defining by statute the operation of nervous shock in cases involving motor vehicle accidents, the Government seeks to prevent any further expansion of this head of damage." (emphasis added) So, too, in the commentary on the clauses which accompanied the introduction of the section, it was stated that160: "[I]t is proposed that ... awards for mental or nervous shock be limited to being made in favour of an injured party, a person at the scene of the accident or a parent, spouse or child of a person killed, injured or endangered in an accident". Hence, as is apparent from the text of the provision, s 53 has the effect of recognising the result in Jaensch of a right of recovery for mental harm suffered by close relatives of an accident victim, but it restricts the eligible class of claimants to parents, spouses and children of persons killed, injured or endangered in the accident. In 1998, the Wrongs Act was amended by the Statutes Amendment (Motor Accidents) Act 1998 (SA). Section 35A(1)(c) was not amended but, in the course 158 South Australia, Legislative Council, Parliamentary Debates (Hansard), 27 November 1986 at 2410. 159 (1983) 33 SASR 254; affd Jaensch (1984) 155 CLR 549. 160 South Australia, Legislative Council, Parliamentary Debates (Hansard), 27 November 1986 at 2411. Nettle of proposing other amendments, which had been rejected, the Minister stated as follows161: "The second [amendment] is for nervous shock which is a recognised psychiatric illness which may be compensable even though no physical injury has been sustained. The difficulty with these cases is that the limits of entitlement to damages are not easy to set and there is potentially and grief. area between nervous Section 35A(1)(c) of the Wrongs Act was inserted in 1986 and amended the law relating to nervous shock caused by or arising out of a motor vehicle accident. a grey shock The provision limits the class of claimants to: parents, spouses or children of persons killed, injured or endangered in motor accidents, or persons actually present, injured or endangered at the scene of a motor accident. However, despite these limitations, it is considered that the CTP Fund remains unreasonably exposed. For example, there is doubt as to whether or not damages for nervous shock can be awarded where a communication about the accident was the only link between the accident and the nervous shock. It is also arguable that damages could be awarded not only to those who witness an accident personally or receive news of the accident personally, but also to those who receive news via the media. If damages can be awarded in such a situation, there would be a significant increase in the number of potential claimants who were not previously considered in premium setting calculations. The Bill as introduced to the other place proposed to amend the current provision to tighten the law so that compensation is limited to persons at the scene, or, family members who sustained nervous shock as a result of being at the scene or immediate aftermath of a motor vehicle accident. The Government will propose an amendment to restore this provision." In 2002, the Wrongs Act was further amended by the Wrongs (Liability and Damages for Personal Injury) Amendment Act 2002 (SA) to extend the mental harm provisions to all classes of personal injury (as opposed to just motor accidents) and to insert the current definition of "accident". Section 35A(1)(c) 161 South Australia, House of Assembly, Parliamentary Debates (Hansard), 18 August Nettle was repealed but s 24C was enacted in substantially similar terms; thus implying a legislative intent that it should continue to limit the class of eligible mental harm claimants to persons who either were present at the scene of the accident at the relevant time or, if not so present, were parents, spouses and children of persons killed, injured or endangered in the accident. As the Minister noted in the second reading speech162: "The current rule in motor accident cases that damages for mental or nervous shock may only be awarded in limited circumstances is carried over to other personal injury cases. In essence, the claimant must have been physically injured in the accident, or present at the scene at the relevant time, unless the claimant is the parent, spouse or child of someone killed, injured or endangered in the accident." Finally, in response to the Review of the Law of Negligence ("the Ipp Report")163, the Wrongs Act was substantially revised and re-enacted as the CL Act with effect from 2004164. Recommendation 34 of the Ipp Report restated the common law factors relevant to determining whether a duty of care is owed in respect of pure mental harm suffered as the result of injury to another in light of the then-recent decisions of this Court in Tame and Annetts165. But, contrary to the reasoning of Sulan J, Recommendation 34 did not necessarily include "recovery for pure mental harm where 'the plaintiff was at the scene of shocking events or witnessed them or their aftermath'"166. The Ipp Report did not make any recommendation as to whether liability to pay damages to a claimant should be limited to persons present at the scene of the accident or other incident which caused the injury, or its aftermath. The Report set out a number of factors relevant to the imposition of limitations of that kind but concluded that restrictions of that kind are arbitrary and, therefore, that individual legislatures are better placed than courts to prescribe them167. 162 South Australia, House of Assembly, Parliamentary Debates (Hansard), 14 August 163 Commonwealth of Australia, Review of the Law of Negligence: Final Report, 164 Law Reform (Ipp Recommendations) Act 2004 (SA). 165 Commonwealth of Australia, Review of the Law of Negligence: Final Report, (2002) at 144; see generally at 137-140 [9.8]-[9.18]. 166 Philcox (2014) 119 SASR 71 at 88 [59] (emphasis removed). 167 Commonwealth of Australia, Review of the Law of Negligence: Final Report, Nettle Consistently with the Ipp Report168, s 53 of the CL Act restricted claims for damages for pure mental harm to claimants who have suffered a "recognised psychiatric illness". But it also re-enacted (in relevantly identical terms to s 35A(1)(c) of the Wrongs Act) the restriction of claims for damages for pure mental harm suffered in relation to accidents to claimants present at the scene of the accident at the relevant time, or to parents, spouses and children of persons killed or injured as a result of the accident. As the Minister stated in the second reading speech, apart from the introduction of the "recognised psychiatric illness" provision, the purpose of s 53 was to "restate the existing law" as found in s 35A(1)(c) and later s 24C169. Conclusions It should be concluded that s 53(1), read with the current definition of "accident", excludes the aftermath of an accident and so confines the class of eligible claimants for pure mental harm suffered as a result of an accident to claimants present at the scene of the accident at the relevant time or, if not present, to parents, spouses and children of persons killed or injured as a result of the accident. Though the appellant owed the respondent a duty to take reasonable care to avoid causing the respondent mental harm, the respondent is not entitled to damages because he was not "present at the scene of the accident when the accident occurred" within the meaning of s 53(1)(a) of the CL Act. Orders In the result, the appeal should be allowed. The orders proposed in the joint judgment should be made. 168 Commonwealth of Australia, Review of the Law of Negligence: Final Report, (2002) at 144, Recommendation 34(a). 169 South Australia, Legislative Council, Parliamentary Debates (Hansard), 15 October 2003 at 354.

HIGH COURT OF AUSTRALIA APPELLANT AND MINISTER FOR EDUCATION RESPONDENT Klein v Minister for Education [2007] HCA 2 1 February 2007 ORDER Special leave to appeal is revoked. On appeal from the Supreme Court of Western Australia Representation C P Shanahan SC with N J Mullany for the appellant (instructed by Butcher Paull & Calder) B W Walker QC with D J Osborn for the respondent (instructed by Blake Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Klein v Minister for Education Statutes – Interpretation – Meaning and effect of s 175 of Workers' Compensation and Injury Management Act 1981 (WA) – Application to public authority – Section 175(1) deemed a principal who contracts with a contractor to be the employer of a worker employed by the contractor, and made principal jointly and severally liable to pay compensation for which contractor was liable to the worker – Section 175(3) provided that a principal was not liable unless work on which worker was employed at the time of disability was "directly a part or process in the trade or business of the principal" – Pt IV Div 2 contained provisions constraining awards of common law damages in actions for damages against a worker's employer brought independently of the Act – Minister contracted with company to provide security at schools – Appellant was employed as security guard by company – Appellant was injured while pursuing intruder at school – Appellant sued Minister as occupier of premises at which appellant injured – Whether s 175(1) deemed the Minister to be the appellant's employer – Whether work on which appellant was employed at time of injury was "directly a part or process in the trade or business" of Minister – Whether effect of deeming provision was to apply constraints on damages in Pt IV Div 2 to appellant's claim. Practice and procedure – Grant of special leave to appeal – Whether matters of statutory interpretation arose without reconsideration of the law as stated in Hewitt v Benale Pty Ltd (2002) 27 WAR 91 – Whether special leave should be revoked – Relevance of common ground between the parties – Relevance of refusal by High Court to permit enlargement of grounds of appeal – Relevance of supervening amendment of the legislation – Relevance of duty to quell the controversy brought to the Court by the parties. Words and phrases – "deemed employer", "directly", "directly a part or process in the trade or business of", "employee", "principal". Workers' Compensation and Injury Management Act 1981 (WA), Pt IV Div 2, Interpretation Act 1984 (WA), s 8. Occupiers' Liability Act 1985 (WA), s 5. Workers Compensation for Accidents Act 1900 (NZ), s 15. GLEESON CJ. The facts and issues, and the course of proceedings in this Court, appear from the reasons of Kirby J. I feel no difficulty about deciding the question of construction considered by the primary judge, and the Court of Appeal of the Supreme Court of Western Australia, upon the assumption, made in both those courts and accepted by the parties in their written submissions in this Court, that Hewitt v Benale Pty Ltd1 was correctly decided. The Justices who refused special leave to appeal in that case regarded the statutory language, upon which the decision was based, as intractable. At the least, the construction adopted in Hewitt was fairly open, the decision has been followed in later cases, and its correctness has been assumed and acted upon by the Parliament of Western Australia. There is no occasion to re-open the issue it decided. In my view, the conclusion reached by the Court of Appeal in the present case was correct, for the reasons advanced in argument in this Court on behalf of the respondent, which largely reflected the reasons given by Wheeler JA. The work on which the appellant was engaged was directly a part or process in the respondent's trade or business within the terms of s 175(3) of the Workers' Compensation and Rehabilitation Act 1981 (WA), having regard to s 6 of that Act. The outcome does not turn upon a distinction between "core" and "incidental" aspects of the respondent's powers. As was submitted by the respondent, the word "directly" prescribes the required close nexus between the relevant work and the relevant exercise of a power or performance of a duty of a statutory authority. In the present case, that nexus was satisfied, having regard to the nature of the work and the width of the authority's statutory powers. I would dismiss the appeal with costs. (2002) 27 WAR 91. GUMMOW, HAYNE AND HEYDON JJ. As originally enacted2, the Workers' Compensation and Injury Management Act 1981 (WA) ("the Act") dealt with the subjects of rights and liabilities relating to payment of workers' compensation, and the compulsory insurance of employers against liability for work-related death and injury. The Act dealt with the subject of common law remedies for such death or injury only by provisions directed against the recovery and retention of both workers' compensation entitlements and damages recovered independently of the Act. In 1993, the Act was amended by the Workers' Compensation and Rehabilitation Amendment Act 1993 (WA), ("the 1993 Amendment Act") by inserting, among other provisions, Div 2 of Pt IV (ss 93A-93F)3. That Division was entitled "Constraints on awards of common law damages". The purposes of the Act as originally enacted, and the Act as amended by the 1993 Amendment Act, were radically different. As originally enacted the Act was remedial and beneficial to workers. As amended, the Act had those beneficial purposes, but also had purposes of constraining recovery of damages in actions brought against employers independently of the Act. Special leave was granted in this matter to permit the agitation of questions about the construction of s 175, a provision contained in the Act as originally enacted. Section 175 was contained in Div 2 of Pt X of the Act. Part X of the Act concerned insurance; Div 2 of Pt X concerned insurance by principals, contractors, and sub-contractors. Section 175 provided: Principal employers contractor and sub-contractor deemed (1) Where a person (in this section referred to as the principal) contracts with another person (in this section referred to as the contractor) for the execution of any work by or under the contractor and, in the execution of the work, a worker is employed by the contractor, both the principal and the contractor are, for the purposes of this Act, deemed to be employers of the worker so employed and are jointly and the severally to pay any compensation which liable 2 As the Workers' Compensation and Rehabilitation Act 1981 (WA). 3 Division 2 of Pt IV was subsequently amended and now comprises ss 93A-93S. contractor if he were the sole employer would be liable to pay under this Act. The principal is not liable under this section unless the work on which the worker is employed at the time of the occurrence of the disability is directly a part or process in the trade or business of the principal. (7) Where the disability does not occur in respect of premises on which the principal has undertaken to execute the work or which are otherwise under his control or management, subsections (1) to (6) inclusive do not apply." Section 175(3) qualified the operation of s 175(1). The particular questions sought to be raised in the appeal to this Court focused particularly upon s 175(3), and what is meant by "directly a part or process in the trade or business of the principal" when, as in the present case, the principal is a public or statutory authority. Section 6 of the Act provided that "[t]he exercise and performance of the powers and duties of a local government or other public, or statutory authority shall, for the purposes of this Act, be treated as the trade or business of such local government or other authority." To focus upon what is meant, in s 175(3), by "directly a part or process in the trade or business of the principal" when the principal is a public or statutory authority, assumes that the provisions of s 175(1) of the Act would otherwise be engaged in a relevant respect. Section 175(1) could be engaged in this case if, and only if, the deeming effected by that provision ("both the principal and the contractor are, for the purposes of this Act, deemed to be employers of the worker so employed") applied to those provisions of Div 2 of Pt IV which constrained awards of common law damages in actions for damages against a worker's employer brought independently of the Act. The Full Court of the Supreme Court of Western Australia held in Hewitt v Benale Pty Ltd4 that the deeming, by s 175(1), of both principal and contractor to be employers of the worker, applied to enlarge the reach of the expression a "worker's employer" when that expression is used in the provisions of Div 2 of Pt IV and, in particular, in s 93B(1), which identifies the application of the (2002) 27 WAR 91. division "to the awarding of damages against a worker's employer independently of this Act". The consequence of reading the Act in this way was that the constraints on damages, provided by Div 2 of Pt IV, were applied to actions, like the present, where an injured worker brought action, independently of the Act, against a person who, although not the worker's employer, was deemed by s 175 to be an employer of that worker. An application was made for special leave to appeal to this Court against the orders made in WMC Resources Ltd v Koljibabic, a case heard and determined by the Full Court at the same time as Hewitt v Benale Pty Ltd. That application was refused5. After the conclusion of the litigation that culminated in that unsuccessful application for special leave, the Western Australian Parliament amended Div 2 of Pt IV of the Act. In particular, the Workers' Compensation Reform Act 2004 (WA) ("the 2004 Reform Act") inserted a new sub-s (5)6 in s 93B to provide: In the context of a cause of action arising on or after the day on which section 79 of the Workers' Compensation Reform Act 2004 comes into operation, a reference in the other subsections of this section to the worker's employer does not include a reference to a person who is the worker's employer only because of section 175." That change to the Act was evidently made on the assumption that, conformably with the Full Court's decision in Hewitt v Benale Pty Ltd, s 175 would otherwise operate to deem certain persons to be employers and thus curtail the rights of workers to make claims against those persons independently of the Act. The change made to s 93B, by the 2004 Reform Act, left the assumed operation of s 175 unaffected in respect of causes of action arising before the day on which s 79 of the 2004 Reform Act came into operation (14 November 2005). To construe s 175, it would be necessary to examine the place that the provision occupied in the Act as a whole, both when the Act was first enacted, and as it has been amended from time to time. It is only against that understanding that it would be possible to say what is meant by the reference to the deeming, for the purposes of the Act, of the principal and the contractor to be employers of the worker. The assumption underpinning the Full Court's decision in Hewitt v Benale Pty Ltd was that the expression "for the purposes of this Act, 5 Koljibabic v WMC Resources Ltd [2003] HCATrans 427. 6 This sub-section was later amended by s 13 of the Workers' Compensation Legislation Amendment Act 2005 (WA) to include reference to s 175AA. deemed to be employers" should be given an ambulatory operation7. The decision proceeded on two related bases. First, "the purposes of this Act" were not confined to those purposes for which the Act was originally enacted (of providing for compensation for injured workers and requiring insurance against the risk of liability to pay compensation or damages for such injuries). Secondly, "the purposes of this Act" were not limited by the immediately succeeding words of s 175(1) creating joint and several liability in those deemed to be employers "to pay any compensation which the contractor if he were the sole employer would be liable to pay under this Act". The particular questions advanced in the present matter, about what is meant by "directly a part or process in the trade or business of the principal" when that principal is a public or statutory authority, cannot be addressed without considering the validity of the conclusion reached, and the assumptions which underpinned the reasoning, in Hewitt v Benale Pty Ltd. In particular, the qualification provided by s 175(3), to the ambit given to the deeming which is worked by s 175(1), is necessarily affected by whether s 175 is to be understood as a section amplifying and extending rights to recovery of workers' compensation, or is to be understood as a section which does that but also cuts down the availability of causes of action and remedies independent of the Act. The Western Australian legislature's evident reliance on the correctness of the decision in Hewitt v Benale Pty Ltd, coupled with the closing of the class of cases in which issues of the kind sought to be agitated in this matter can arise, make it inappropriate for this Court now to consider whether to disturb the state of the law as stated in Hewitt v Benale Pty Ltd. Special leave to appeal should be revoked. The matters which lead to the revocation of leave not having emerged at the time the application for special leave was heard and granted, the costs of the proceedings in this Court should lie where they fall. (2002) 27 WAR 91 at 104-105 [74]-[76] per Hasluck J. Kirby KIRBY J. Originally, this appeal, brought by special leave8, concerned the meaning of the adverb "directly" in s 175(3) of the Workers' Compensation and Rehabilitation Act 1981 (WA) ("the Act"). That issue was presented by a decision of the Court of Appeal of Western Australia9. That decision was adverse to the entitlement of Mr Alan Klein ("the appellant") to bring proceedings against the Minister for Education of Western Australia ("the Minister") for damages for personal injury. The Court of Appeal, proceeding on the basis that the Minister was the appellant's deemed employer pursuant to ss 6 and 175 of the Act, treated the case as subject to restrictions imposed by the Act10 limiting the availability of common law damages against an employer to circumstances which concededly did not apply in the appellant's case11. At all stages in these proceedings below, both parties accepted that the prohibition and limitations on the bringing of such proceedings against a deemed employer such as the Minister, provided by the Act, applied to the case. However, the appellant submitted that, on the particular facts of his case, he was not employed at the time of the occurrence of his disability in work which was "directly a part or process in the trade or business of the [Minister]"12, and for that reason, fell outside s 175 of the Act. That argument was accepted at trial13. It was on that basis alone that the primary judge (Nisbet DCJ) concluded that, in relation to the Minister, the appellant was not "caught by the provisions of Division 2 [of Pt IV] of the … Act"14. That was the conclusion which was reversed by the Court of Appeal15 in an unanimous decision (Wheeler JA; Steytler P and Pullin JA concurring). The issue so presented became the sole question argued on the application for special leave to appeal. It was the only 8 Granted by Gummow and Hayne JJ and myself. See Klein v Minister for Education [2006] HCATrans 469. 9 Minister for Education v Klein [2005] WASCA 185. 10 Pt IV, Div 2 of the Act (s 93E), which was inserted by the Workers' Compensation and Rehabilitation Amendment Act 1993 (WA), limits the recovery of damages to cases where the degree of disability is not less than 30%. See further these reasons below at [26]. 11 The concession was repeated before this Court in the argument of the appeal. See [2006] HCATrans 576 at 970. 12 The Act, s 175(3) (emphasis added). 13 Klein v Minister for Education [2004] WADC 153. 14 (2004) 37 SR (WA) 328 at 338 [33]. 15 [2005] WASCA 185. Kirby ground upon which special leave to appeal was granted. Unsurprisingly, it alone was addressed in the written submissions of both parties. During oral argument of the appeal a second issue emerged as a result of questioning by the Court. This was whether, apart from the meaning of the word "directly" in s 175(3) of the Act, a true construction of the Act might yield a conclusion that Pt IV, Div 2 did not apply to the relationship between the appellant and the Minister in any case. If that were so, the importation of the Act's prohibition and limitations on the bringing of an action for damages for personal injury against the Minister would not apply. The appellant would be entitled to proceed with his action, uninhibited by the provisions of the Act. This issue addressed attention, not to the word "directly" in s 175(3) of the Act but to the word "employer" in s 93B(1) of the Act, by which Pt IV ("Civil proceedings in addition to or independent of this Act") is applied: the awarding of damages against a worker's employer independently of this Act in respect of a disability suffered by a worker [and] caused by the negligence or other tort of the worker's employer [in respect of which] compensation has been paid or is payable … under this Act"16. Both parties to the appeal resisted the new point when members of the Court presented it to them17. Eventually, however, sensing the way the wind was blowing, the appellant sought leave to amend his notice of appeal to raise this alternative attack on the application of Pt IV, Div 2 to his action for damages18. The Court considered the application. By majority, the application for leave to amend the notice of appeal was refused19. Ominously, the appellant was then put on notice that he had to argue the question whether the grant of special leave should be revoked. A majority of this Court has now decided that special leave should be revoked20. I disagree. In my opinion, the Court should decide the appeal which 16 The Act, s 93B(1) (emphasis added). 17 See [2006] HCATrans 576 at 1252 (appellant); [2006] HCATrans 576 at 2813- 2821 (respondent). 18 [2006] HCATrans 576 at 1635. 19 [2006] HCATrans 576 at 2246 per Gleeson CJ. 20 Reasons of Gummow, Hayne and Heydon JJ ("joint reasons") at [16]. Kirby the parties came to argue. The suggested ground of revocation of special leave does not enjoy merit. It should not be entertained21. It follows that there are now two issues for decision in this appeal. The first is whether special leave should be revoked. If this issue is decided in the negative, a second issue arises, namely, whether the Court of Appeal erred in a material way in the decision challenged in the appeal. Both of those issues should be answered in the negative. The facts The appellant was employed as a security guard in Western Australia by Falcon Investigations and Security Pty Ltd ("Falcon"). In February 1999, Falcon contracted with the Minister to provide security to designated public schools in the State. The appellant's work was carried out as part of Falcon's contract with the Minister. During the night of 1 November 1999, at a primary school in Perth, responsibility for which fell within Falcon's contract, the appellant chased a youth whom he had seen smashing windows in the school. The intruder fled into knee-high grass within the school grounds. Whilst pursuing him, the appellant fell, occasioning injury. However, he restrained the intruder who, like himself, was injured as a consequence of running into a mound of concrete that had been deposited in the grass on the school grounds, but which was obscured by the height of the grass and a lack of lighting. The appellant's injuries were found to include a fractured patella. He was unable to return to his employment with Falcon. The appellant sued the Minister in the District Court of Western Australia. His amended statement of claim made no reference to any duty on the part of the Minister arising from the Minister's status as his employer. It did not include any claim against Falcon, as his employer. The claim was pleaded against the Minister solely as occupier of the school premises in which the appellant had been injured. Relevantly, it relied on a claim based on s 5 of the Occupiers Liability Act 1985 (WA), concerned with the duty of an occupier of land to protect an entrant upon the land "in respect of dangers which are due to the state of the premises or to anything done or omitted to be done on the premises and for which the occupier is by law responsible"22. It was on this footing that the primary judge found that the Minister was liable in law to pay damages to the appellant. He rejected a defence of 21 cf reasons of Gleeson CJ at [2]. 22 Occupiers Liability Act 1985 (WA), s 5(1). By s 4(1) the provisions of s 5(1) apply "in place of the rules of the common law". Kirby contributory negligence23. He awarded damages in an amount just over $100,000. None of these issues is now in contest. The sole defence that remained alive, until this case reached this Court, was that propounded by the Minister at trial, namely that he had contracted with Falcon for the execution of security work; that this extended to the security of the premises in question; and that the work on which the appellant was employed when he suffered his disability was "directly a part or process" in the Minister's "business of the provision of educational services". On this basis, the Minister said that he was "the deemed employer" of the appellant pursuant to s 175 of the Act and, in consequence, that the appellant had no entitlement to an award of damages against him as "the deemed employer". The Minister claimed that the appellant's action had failed to comply with s 93E(3) of the Act, which limited the award of damages in such cases to those involving a serious "degree of disability24". It was common ground that the appellant's disability was not of the specified degree of seriousness. As has been said, the appellant's reply to this defence, virtually to the end of the proceedings, was not that a potentially "deemed employer", such as the Minister, was not the "employer" for the purposes of Pt IV, Div 2 of the Act, including s 93E(3). It was that those provisions did not apply on the particular facts because the Minister was not liable as a "deemed employer" by reason of the fact that the "work on which the worker [was] employed at the time of the occurrence of the disability" was not "directly a part or process in the trade or business of the [Minister]". The decisional history In the District Court: The primary judge, after a review of authority25 in Western Australia26, concluded in terms that adopted a meaning of the word "directly" that the appellant urged on this Court: "… I have difficulty in seeing how the engagement of a security patrolman to patrol the defendant's capital assets is in any way a part or process in the trade or business of the principal: namely the defendant, in providing public education. True it is that a serious enough break-in with theft of equipment or an arson would disrupt the defendant's operations, 23 (2004) 37 SR (WA) 328 at 333-334 [16]. 24 The Act, s 93E(3), was later amended. 25 (2004) 37 SR (WA) 328 at 337 [33]. 26 (2004) 37 SR (WA) 328 at 336-337 [29]-[31]. Kirby but it is no more part of the defendant's trade or business than the provision of security by way of night patrols by security patrolmen in a used car yard could be said to be part or process in the trade or business of selling second-hand cars, and certainly, in my opinion, it cannot be said that a security patrolman is performing work which is directly a part or process in the trade or business of this defendant." It was on this basis that the appellant succeeded at trial. However, the Minister appealed to the Court of Appeal. In the Court of Appeal: Wheeler JA saw the resolution of the issue in the appeal as depending upon particular provisions appearing in s 6 of the Act by which the "trade or business" of a public authority, such as the Minister, is defined: "The exercise and performance of the powers and duties of a … public, or statutory authority shall, for the purposes of this Act, be treated as the trade or business of such … [an] authority". Both the primary judge27, and Wheeler JA in the Court of Appeal28, noted that, whilst the Education Act 1928 (WA) ("the Education Act") did not contain provisions in the nature of a list of powers and duties of the Minister, it did include a number of relevant provisions indicating what those powers and duties included. Thus the long title of the Education Act was "[a]n Act to consolidate and amend the law relating to public education and for incidental and other purposes" (emphasis added). Section 5 of that Act constituted the Minister as a body corporate capable (relevantly) of "acquiring, holding [and] leasing … real … property" and "doing and suffering all such other acts and things as may be necessary or expedient for carrying out the purposes of this Act". Moreover, by s 9 of the Education Act, the Minister is granted specific powers, including a power to "continue and maintain and carry on any Government schools … deem[ed] necessary or convenient for public education and the purposes of this Act" (emphasis added). These provisions convinced both the primary judge29 and Wheeler JA30 that the Minister's engagement of Falcon and its security services, for the purpose of protecting government schools, became part of the Minister's "trade or business" by reason of s 6 of the 27 (2004) 37 SR (WA) 328 at 336 [24]. 28 [2005] WASCA 185 at [8]. 29 (2004) 37 SR (WA) 328 at 336 [27]. 30 [2005] WASCA 185 at [9]. Kirby Act. Before this Court, the appellant did not contest the correctness of that determination. The point of disagreement: The point of disagreement between the Court of Appeal and the primary judge concerned the latter's conclusion that it was necessary to characterise, and to separate, the Minister's powers and duties into "core" or "essential" functions and "ancillary" or "incidental" functions31. Wheeler JA concluded that such a differentiation involved error which had no foundation in the language of the Act32: "The legislative policy [of s 6] seems to be that anything which a public authority lawfully does is to be regarded as its trade or business. One can understand readily why this might be so. Public authorities evolve over time: some are amalgamated; some are abolished and part or all of their functions given to different authorities; the services which they deliver and the way in which they deliver them will change according to budgetary requirements and public views as to what is considered appropriate for governmental activity". Applying the statutory criterion of "directly", as stated in s 175(3) of the Act, her Honour concluded33: "… [T]he powers of the [Minister] specifically include the power to … maintain government schools as deemed necessary for the purposes of the Act. That power necessarily involves … a complex set of actions, and would encompass the power to cause schools to be constructed, to be cleaned, to be repaired, and to be secured as necessary. Those powers are therefore powers which, for the purposes of the Act, are to be treated as the trade or business of the [Minister] … The work in which the respondent was engaged was directly a part, therefore, of that trade or business … It is enough for the Court to know that the Minister is empowered to carry out the functions set out in the Act and that he has determined that it is appropriate to do so by engaging security services." It was on this footing that the judgment entered by the primary judge in favour of the appellant was set aside. The appeal to this Court comes from the Court of Appeal's orders giving effect to that conclusion. 31 cf reasons of Gleeson CJ at [3]. 32 [2005] WASCA 185 at [15]. 33 [2005] WASCA 185 at [17]. Kirby Special leave should not be revoked Deciding the appeal: There are a number of reasons why I would not join in the order, now made by the majority, to revoke special leave: No party sought such an order and, to the contrary, both parties asked this Court to decide the appeal; Both parties have incurred considerable costs, in this Court and in the courts below. The costs of the appeal have now been fully expended; The supposed question of legal doubt, presented as a ground for revoking the grant of special leave, is decided by the repeated authority of the highest court of Western Australia, to which belongs the last word about the interpretation of the legislation of that State, save in the exceptional cases in which this Court grants special leave to permit an appeal against such an interpretation; The disposition of the question whether such special leave should be granted was considered by a Full Court of this Court, which refused special leave to challenge it; and The disposition is, in any case, apparently correct and any doubts about it do not warrant the refusal now to decide the present matter, especially when the suggested interpretation is not available to help resolve the appeal. The position of the parties: Neither party wanted to argue the point which the majority now finds decisive for the revocation of special leave. In the unexpected turn of events, the appellant ultimately sought leave to add the ground suggested by questions from the Court. However, it was a reluctant request, arising from exigent circumstances, and it was never formalised. The Court refused to permit the added ground. No party, by its process or arguments can impose on this Court an incorrect application of the law34. Each judge has a right to adopt a construction of legislation that has not been advanced by the parties or put in issue by the pleadings in the record if that course appears necessary to resolving the matter in contest in accordance with law. Subject to considerations of procedural fairness 34 Roberts v Bass (2002) 212 CLR 1 at 54 [143]-[144]; Gattellaro v Westpac Banking Corporation (2004) 78 ALJR 394 at 409 [93]; 204 ALR 258 at 278-279; Chief Executive Officer of Customs v El Hajje (2005) 224 CLR 159 at 181 [60]. Kirby and disqualification by the parties' conduct, Lord Wilberforce's dictum in Saif Ali v Sydney Mitchell & Co35 is correct: "Judges are more than mere selectors between rival views – they are entitled to and do think for themselves." However, in these proceedings, the question is not one of entitlement but whether the present case is an occasion for its exercise, as was held to be the case in Chief Executive Officer of Customs v El Hajje36. Ordinarily, it is left to the parties to define the controversy which they bring to the courts for resolution. Indeed, in Australia so much is implicit in the constitutional function of federal courts37. In the absence of a clear error in the exposition of the governing law, it would be normal in such circumstances for a court to proceed on the basis that an unchallenged exposition of the law is correct. Both parties had incurred considerable costs in the litigation; and substantial costs in this Court. Whilst those of the Minister are a burden on the taxpayer, the costs incurred by a litigant such as the appellant normally secure for him an expectation that, once special leave is granted, the Court will decide the matter on the merits. In my opinion, that is what the Court should do38. Both parties agreed that, notwithstanding supervening amendments to the Act, because s 175(3) remains part of the Act, its meaning still presents live questions. Its significance therefore extends beyond the consequences for the parties to this appeal. In such circumstances, a revocation of special leave should be reserved to the clearest case, which this is not. Because the revocation of special leave has occurred after the appeal has been heard in its entirety, it will not save the Court's time or release a hearing day for use by other parties39. 35 [1980] AC 198 at 212. See Autodesk Inc v Dyason [No 2] (1993) 176 CLR 300 at 317; Project Blue Sky Inc (1998) 194 CLR 355 at 366 [13]; Coleman v Power (2004) 220 CLR 1 at 94 [243]. 36 (2005) 224 CLR 159 at 171 [28]; cf at 181 [60], 185 [73], 187 [78]. 37 Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 355 [45] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ; Re Macks; Ex parte Saint (2000) 204 CLR 158 at 278 [340] per Gummow and Hayne JJ. 38 cf James Hardie & Co Pty Ltd v Seltsam Pty Ltd (1998) 196 CLR 53 at 74-75 [59]. 39 cf South-West Forest Defence Foundation v Department of Conservation and Land Management (WA) (1998) 72 ALJR 837 at 840 [22]; 154 ALR 405 at 410. Kirby Earlier decisions of the courts: The refusal by this Court to allow the addition of a ground of appeal, based on the meaning of "employer" in s 93B of the Act40, leaves standing the concluded authority of the courts of Western Australia on that legal point. Of course, upon questions of statutory interpretation (perhaps especially by the time it reaches this Court) competing arguments can usually be advanced for the contending constructions41. But it is not as if the legal issue now said to warrant the revocation of special leave had been dealt with in a cursory or obviously unsatisfactory way by the courts of Western Australia. On the contrary, the appellate court of that State had, on at least three occasions, reaffirmed the conclusion that is now said to be in such doubt as to require the revocation of the grant of special leave. The Full Court did so in Hewitt v Benale Pty Ltd42. That appeal was decided at the same time as an appeal in WMC Resources Ltd v Koljibabic43. Upon its establishment, the Court of Appeal reaffirmed these decisions in the later appeals in Marsden v Unimin Australia Ltd.44 The reasoning of the Full Court in Jones v Westfarmers Ltd45 also proceeded on a similar footing. In these circumstances, whilst allowing for possibilities inherent in any human institution of repeated error in the courts below, it would not be unreasonable for this Court to accept, for the purposes of the present appeal, that the approach and conclusion of the appellate court of Western Australia were correct. At least, it would not be unreasonable to treat them as correct, and as establishing the settled meaning of the statutory provisions in question given that no-one was suggesting otherwise. Two further considerations lend force to this approach. The first, recorded by Scott J in his reasons in the Full Court in Hewitt46, is the fact that the New 40 See joint reasons at [10]-[11]. 41 News Ltd v South Sydney District Rugby League Football Club Ltd (2003) 215 CLR 563 at 580 [42]. 42 (2002) 27 WAR 91 at 109-111 [94]-[102]; cf reasons of Gleeson CJ at [2]. 43 (2002) 27 WAR 91 at 97 [26], 106-109 [87]-[93]. 44 [2004] WASCA 143. See also [2004] WADC 153 at [29]; Price v Resolute Resources Ltd (2002) 29 SR (WA) 371. 45 [2003] WASCA 225 at [70]-[71]. 46 (2002) 27 WAR 91 at 100 [45] per Scott J. Kirby South Wales Court of Appeal, construing corresponding provisions in the New South Wales legislation in OP Industries Pty Ltd v MMI Workers' Compensation (NSW) Ltd47, came to a like conclusion about the meaning of the phrase "for the purposes of the Act"48. Like the Western Australian courts, the New South Wales Court of Appeal did not limit the operation of the phrase to the recovery of statutory compensation. All of the judges in that case took the view that, to impose such a restrictive construction on that phrase would give rise to complications that the legislation was intended to overcome. Similar conclusions have been reached by the Supreme Courts of Queensland49 and Victoria50, where comparable statutory provisions operate. Additionally, as noted in the joint reasons in these proceedings, since the series of decisions of the appellate courts just referred to, the Parliament of Western Australia has amended the Act on a footing that can only be understood as accepting the correctness of the appellate decisions concerned51. That is surely an additional reason for this Court to treat the Western Australian decision as correctly made and to proceed with the resolution of this appeal on that basis. Disposition by this Court: There is a still further consideration. Although the decision in Hewitt was not itself the subject of an application to this Court, special leave to appeal was sought in the companion proceedings in Koljibabic. The application was argued in full by well represented parties before a special 47 (1998) 17 NSWCCR 193 (NSWCA). 48 Like the provision under consideration in this case, cl 1, Sched 1 of the Workers' Compensation Act 1987 (NSW) provides that a person or body may, in certain circumstances, be "deemed" an employer "for the purposes of the Act". In OP Industries Pty Ltd v MMI Workers' Compensation (NSW) Ltd (1998) 17 NSWCCR 193 the New South Wales Court of Appeal construed the phrase "for the purposes of the Act" in such a way as not to limit its operation to the recovery of statutory compensation. Beazley JA and Fitzgerald AJA took the view that to impose a restrictive or narrow construction of that term would leave open complications that the clause was intended to overcome. Meagher JA expressed the same view. 49 Workers' Compensation Act 1916 (Qld), ss 8, 9A(1)(b); cf Workers' Compensation Board of Qld v Boyne Smelters [1996] QCA 255. 50 Workers Compensation Act 1958 (Vic), s 3. 51 Workers' Compensation Reform Act 2004 (WA), s 73, inserting s 93B(5) into the Act. Kirby leave panel of this Court52. Special leave was refused. Giving the Court’s "The language of section 175(1) of the [Act] is intractable. The duty of courts is to give effect to the purpose of Parliament derived from the language of the statute. It is true that the construction favoured in the Full Court can lead to potential injustice to a deemed employee in certain circumstances. However, the contrary construction urged by the applicant results in consequences that are also unlikely. In these circumstances, the purpose must be derived from the statutory text. The applicant's construction would, it seems to us, require major surgery on the legislative language." Whilst the disposition of a special leave application does not create a binding legal principle of this Court, it might be thought that the rejection of the suggested point of statutory uncertainty, in such strong terms, would at least sustain a conclusion that this Court, in the present appeal, could safely proceed to decide the matter on the basis of the settled exposition of the meaning of the Act thereby confirmed. The decision is apparently correct: Having regard to the refusal by this Court, as now constituted, to permit a ground of appeal to contest the correctness of the interpretation of the Act adopted in Hewitt, and the associated cases, it would not be proper to embark on a detailed analysis of that authority. However, in view of the Court’s disposition that now takes effect, and becomes the legal principle for which this matter stands, it is appropriate to notice some of the main elements of the reasoning of the courts below, in order to appreciate why that reasoning does not warrant doubt or hesitation on our part. The essential question is whether the deemed employment for which s 175(1) of the Act provides created a relationship with the deemed "employer" that attracted the prohibition and limitations on the bringing of civil damages proceedings against the deemed "employer" under Pt IV, Div 2 of the Act. Against such a construction, the workers opposing it in the earlier cases invoked various canons of interpretation to resist its consequences. These included the principle, long established in this Court, obliging a strict approach to statutory provisions that would have the effect of modifying long established common law rights (such as the right to bring a civil damages action against a 52 Comprising McHugh and Heydon JJ and myself. See [2003] HCATrans 427. 53 [2003] HCATrans 427 at 637. Kirby party otherwise liable54). As well, the arguments invoked the principle that beneficial or remedial legislation, as the Act could generally be described, should not ordinarily be construed so as to prejudice the party which it is intended to benefit55. Further, the principle that deeming provisions (such as s 175(1)) should normally be construed strictly and confined in their operation, was called in aid56. All of these, and other principles of construction, were carefully considered in the courts below before the favoured interpretation was adopted. In the end, however, as E M Heenan J pointed out in Hewitt57, the duty of a court is to uphold the purpose of Parliament as expressed in the language of the legislation. The pull of particular canons of construction "must … be restrained within the confines of 'the actual language employed' and what is 'fairly open' on the words used"58. Foundations for the interpretation: The essential foundation of the view of the legislative phrase preferred in both the Western Australian and other State appellate courts was, as this Court observed in refusing special leave in Koljibabic, the "intractable" language of the Act. The language of s 175(1) creates the relationship with the "deemed employer" there provided as one "for the purposes of this Act." On the face of things, that expression refers to the entire Act. Had something more limited been intended, a more restrictive phrase would have been used, or a provision such as s 93B(5), since enacted, would have been included in earlier drafts of the Act59. 54 Hewitt (2002) 27 WAR 91 at 114-115 [113], citing Bishop v Chung Bros (1907) 4 CLR 1262 at 1275; Hocking v Western Australian Bank (1909) 9 CLR 738 at 746. See also more recently Bropho v Western Australia (1990) 171 CLR 1 at 18; Coco v The Queen (1994) 179 CLR 427 at 437; Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476 at 492 [30]. 55 Hewitt (2002) 27 WAR 91 at 118 [124]-[125], citing Bull v Attorney-General (NSW) (1913) 17 CLR 370 at 384; Bird v The Commonwealth (1988) 165 CLR 1 at 56 Hewitt (2002) 27 WAR 91 at 117 [120]. See also Muller v Dalgety & Co Ltd (1909) 9 CLR 693 at 696. 57 Hewitt (2002) 27 WAR 91 at 116 [118]. 58 Khoury v Government Insurance Office (NSW) (1984) 165 CLR 622 at 638. See also Re Bolton; Ex parte Beane (1987) 162 CLR 514 at 518. 59 Joint reasons at [12]-[13]. Kirby It is also necessary to note the presumption expressed in s 8 of the Interpretation Act 1984 (WA), that a written law: "… shall be considered as always speaking and whenever a matter or thing is expressed in the present tense, it shall be applied to the circumstances as they arise, so that effect may be given to every part of the law according to its true spirit, intent, and meaning"60. By using the words it did in s 175(1) of the Act, the Parliament of Western Australia sought to enliven the relationship of deemed employment for all purposes for which employment was relevant in the Act, including in Pt IV, Div 2. Whilst in this case, the presumption is contained in a statute, it can also be traced to a longstanding common law rule of statutory interpretation61. The restrictions introduced by Pt IV, Div 2 of the Act were controversial62, and on one view, harsh. They were not, as such, restrictions on a worker's statutory workers' compensation rights. On the face of things, they do not, therefore, enliven the principle favouring a beneficial construction of such statutory rights. Nevertheless, they constituted a deliberate reduction of the common law rights of "workers", such as the appellant, to recover damages independently of the Act. If by chance Falcon had been uninsured, the appellant would, inferentially, have been foremost in his claim for statutory workers' compensation benefits under the Act against the Minister. On the face of things, he would have enjoyed that entitlement. In such circumstances, to restrict his entitlement otherwise, to pursuing a civil damages action against the Minister, represents no more than the opposite side of the coin. A court giving meaning to the Act is obliged to do so with a neutrality grounded in the statutory language63. The argument that s 175 of the Act should be treated as creating a special category of "deemed employers", without application to other parts of the Act, hardly squares with the application of the definition of "employer" in s 175 to provisions in other sections of the Act, such as s 92, where that definition was always intended to apply64. As E M Heenan J remarked, "[t]he question then 60 As Scott J concluded in Hewitt (2002) 27 WAR 91 at 98 [35]. 61 Lake Macquarie Shire Council v Abadare County Council (1970) 123 CLR 327 at 331; cf Coleman v Power (2004) 220 CLR 1 at 95-96 [245]-[249]. 62 Hewitt (2002) 27 WAR 91 at 116 [118]. 63 Hewitt (2002) 27 WAR 91 at 118 [123]. 64 (2002) 27 WAR 91 at 118 [123]. See also at 104-105 [74]-[77]. Kirby becomes, whether there is anything to differentiate Div 2 of Pt IV from all other provisions in the Act including Div 1"65. In these circumstances, if this Court were to pause long enough to notice the reasons given in Hewitt and the other cases mentioned above, a fair reading would, I believe, convince us that the suggested ambiguity is not ultimately established. Certainly, there is not such an uncertainty as to warrant this Court's revoking a grant of special leave and depriving the parties of their normal expectation, where an appeal has been fully heard, that the Court will quell the controversy between them by a decision reached on the legal and factual merits. After all, the most that is involved is the interpretation of legislation that has now been amended in part. There are many occasions where this Court has decided matters within the confines of the arguments and assumptions presented by the parties, whilst reserving particular points, unpleaded or unargued, to a case where it is necessary to decide them66. Conclusion: appeal should be decided: It is for these reasons that I respectfully disagree with the conclusion of the majority that special leave should be revoked. My conclusion in this regard obliges me to decide the merits of the appeal. In the circumstances, I can do so briefly. The appeal fails on the merits Appellate misstatement conceded: The appellant strongly attacked a passage in the reasons of Wheeler JA and the Minister conceded that this passage contained a legal error. The passage in question follows earlier reasoning quoted above67. Wheeler JA stated68: "It may well be that, once the operation of s 6 is correctly understood, there is little for the word 'directly' to do in s 175(3), so far as public authorities are concerned. That is, it would normally be the case that work was either part of the trade or business of a public authority within the meaning of s 6, or it was not. It may be that there are some activities, which are so peripheral to the exercise of the authority's statutory powers that, although they are necessarily to be implied as 65 Hewitt (2002) 27 WAR 91 at 118 [123] per E M Heenan J. 66 See, eg, Weiss v The Queen (2005) 224 CLR 300 at 317-318 [46] (reserving possible constitutional questions). See also Nudd v The Queen (2006) 80 ALJR 614 at 637 [111]-[112]; 225 ALR 161 at 190. 67 See above, these reasons at [30], [33]-[34]. 68 [2005] WASCA 185 at [16]. Kirby arising from the conferral of legal personality upon an authority, they would not be regarded as powers 'of' the authority, as opposed to powers which necessarily belong to any legal person. However, in my view, issues of that kind do not arise in the present case." It was Wheeler JA's statement that "[i]t is enough for the Court to know that the Minister is empowered to carry out the functions set out in the Act and that he has determined that it is appropriate to do so by engaging security services" that the appellant latched on to. He complained that this effectively erased the requirement of demonstrating that the work on which the worker is employed at the time of the occurrence of the disability is "directly a part or process in the trade or business of the principal". According to the appellant, the insertion into the statutory text of the adverb "directly", demanded attention. Because the Court of Appeal implicitly denied that necessity, and acknowledged "little … operation" for the word to perform, it erred in law in its interpretation of s 175(3) of the Act. In his submissions, the Minister accepted that the foregoing passages indicated legal error. He submitted that the Court of Appeal should have identified "the work" on which the worker was employed and then considered whether such work was "directly" a part or process of the Minister's trade or business, including the maintenance of government schools. According to the Minister, "the work" on which the appellant was employed at the time of his injury was protecting and securing (and thus contributing to the maintenance of) public schools, including the one on whose premises he was injured. Such work was "directly" a part or process of the Minister's "trade or business", as defined by s 6 of the Act. According to the appellant, the requirement of directness in s 175(3) imported notions that "the work" in question should be referable to the "core activities in the trade or business of the principal and not merely generic services"; that it should be functionally referable to such activities; and that it should be immediately referable to the work of the Minister, because it is "the work" which is the responsibility of the principal (here the Minister) and which cannot be carried out by others. A verbal error is sustained: I am prepared to accept the common ground between the parties that, in the expression of the reasoning that sustained the conclusion of the Court of Appeal, that Court omitted express consideration of whatever requirement was imported by the word "directly", as it appeared in s 175(3). The word appears in the sub-section. Seemingly, it is a deliberate insertion. It imports an additional qualification69. It is expressed in an ordinary adverb of everyday use. Indeed, in the present context, the word has a long history. 69 cf reasons of Gleeson CJ at [3]. Kirby When the United Kingdom Parliament enacted the Workmen's Compensation Act 1897 (UK)70, and provided liability to pay compensation benefits in certain circumstances to the workmen of a contractor "in respect of any accident arising out of and in the course of their employment"71, no reference was made to an exemption where the work on which the workman was employed at the time of the occurrence of the accident was directly a part or process in the trade or business of the principal (there called "the undertaker"). The only qualification expressed was to the effect that the section would not apply: "… to any contract with any person for the execution by or under such contractor of any work which is merely ancillary or incidental to, and is no part of, or process in, the trade or business carried on by such undertakers respectively". The origin of the word "directly" can apparently be traced to the Workers' Compensation for Accidents Act 1900 (NZ). By that Act, the New Zealand Parliament provided in s 15 for "Liability in cases of contracting or sub- contracting". After providing for the joint and several liability of a principal and contractor72, the Act went on to specify certain qualifications73: "The principal shall not be liable under this section except in cases where the work to be executed under the contract, and in which the worker is employed, – Relates directly to the land, building, vessel, or other property of the principal; or Is directly a part of or a process in the trade or business of the principal When the present Act was enacted in Western Australia, s 175(3) was the local attempt to express a qualification similar to that appearing in s 15(3)(b) of the New Zealand Act. Section 175(7) was a local reflection of the provisions contained in s 15(3)(a) of the New Zealand Act. Section 175(7) of the Act states: 70 60 & 61 Vict c 37. 73 s 15(3) (emphasis added). Kirby "Where the disability does not occur in respect of premises on which the principal has undertaken to execute the work or which are otherwise under his control or management, subsections (1) to (6) inclusive do not apply." Viewed in the light of this history, and of the purposes evident in the language of these sub-sections, the object of the restrictions so imposed on the notional type of employment relationship created by the Act becomes a little clearer. By reference to the provisions of s 175(3) of the Act, Hasluck J in Hewitt74 explained the object in language that I find helpful: "The effect of that provision [s 175(3)] is that the principal is not liable under the deeming provision unless the work on which the worker is employed at the time of the occurrence of the disability is directly a part or process in the trade or business of the principal. This suggests that the deeming provision is only to apply in circumstances where the work being performed approximates to the worker's usual course of employment. It seems to me that this restriction removes any element of unfairness that might arise if the party contracting out its labour were to be unexpectedly exposed to a liability for damages at common law which arose from work not usually being performed by the actual employer." This approach finds support in the meaning of the word "directly". Dictionary definitions suggest that the word connotes the doing of something without an intermediary, "by a direct process"75. The word therefore introduces notions of connection, in a particular way or manner, with the defined work of the principal, here, the Minister. It is not, as such, concerned to limit or expand the definition of the work. In the Act, that function is performed, in the case of a public authority, by the very broad provisions of s 6. Moreover, the element of "directness" has to be discovered within a provision of the Act (s 175) which, of its very nature, is concerned with the "occurrence of … disability" to a person who is the actual employee of someone else, a contractor, and for whom the principal is only a "deemed … employer of the worker"76. The very engagement of contractors might, in a particular case, suggest the performance of "the work" which, loosely or generically speaking, is outside the "core" function of "the work" of a public authority when viewed globally. However, by s 6 of the Act, that is not the way "the work" of the public authority 74 (2002) 27 WAR 91 at 105 [77]. 75 New Shorter Oxford English Dictionary (1993) vol 1 at 680; Macquarie Dictionary, 3rd ed (rev) (2001) at 539. 76 The Act, s 175(1). Kirby is defined77. By that section, the "trade or business" of the public authority is defined very broadly, by reference to "the exercise and performance of the powers and duties" of the authority. Necessarily "the work", incidental to such exercise and performance, is "a part or process in" the trade or business so defined. The appellant attempted, by reference to judicial elaborations of the word "directly" in a revenue context78 to argue for a different meaning for the word in s 175(3) of the Act. However, the applicable meaning must be derived from the language of the Act in question here, which must be read as a whole so as to give effect to its provisions. Conclusion: immaterial error: When the above approach is adopted, it may be that there was a verbal slip in the last step of the reasons of Wheeler JA for the Court of Appeal. The requirement of s 175(3) of the Act, being in the statute, must be given effect according to its terms. It cannot be ignored or bypassed. Yet in all truth, once the "trade or business" of a public authority is defined in such broad language by reference to that authority's particular "powers and duties" (as s 6 of the Act provides here) the likelihood is that, as Wheeler JA remarked, there will be "little for the word 'directly' to do in s 175(3)"79. This is because, typically, as in the present case, the statutory definition of the "powers and duties" of an authority will be very ample, as they are here, and a direct connection to them will not be difficult to prove. Nonetheless, there will be a boundary. It is fixed by the statutory provisions creating the public authority in question and by the outer limits of the defined "trade or business" that can be characterised as that "of" the authority, here the Minister, conformably with the approach required by s 6. The Minister effectively demonstrated the ultimate accuracy of Wheeler JA's description of the ambit of "directly" in s 175(3) by the instance propounded as a case that would be excluded by that word in the sub-section. He suggested that, if an employee of Falcon, for that company's own insurance purposes, had reconnoitred the site of the public school in question, including at night, so as to understand the nature of the work conditions to which Falcon's employees were being sent and for the purpose of renewing Falcon's insurance cover, an injury by falling over concrete rubble in long grass in the school 77 cf reasons of Gleeson CJ at [3]. 78 eg Textron Pacific Ltd v Collector of Customs (Qld) (1987) 17 FCR 305 at 309- 79 [2005] WASCA 185 at [16]. Kirby grounds would not be "directly" part "of" the defined trade or business of the Minister80. I accept the illustration. Yet it does tend to reinforce Wheeler JA's point. It is true that, the exclusion being expressed in s 175(3), it cannot be ignored. If that is what the closing words of the Court of Appeal's reasons suggest, they would need to be modified. Conclusion: Court of Appeal orders correct: When, however, the question is asked whether the work on which the appellant was employed by Falcon at the time of the occurrence of his disability was "directly a part or process in the trade or business" of the Minister, the answer in this case is plain. The "trade or business" is defined, in the case of such a statutory authority as the Minister, by s 6 of the Act. That section equates the exercise and performance of the powers and duties of the Minister to his "trade or business". Amongst the express and implied powers and duties of the Minister under the Education Act are those concerned with maintaining school premises. Providing security for such premises is clearly "directly a part or process" in the defined "trade or business" of the Minister81. At the time of the occurrence of his disability, the appellant's work was that of securing the school premises. The exclusion of the Minister from liability as a "deemed employer", provided for in s 175(3) was, therefore, engaged in the circumstances of this case. The Minister was "deemed to be [the] employer of the worker", although he was actually employed by Falcon. As such, the Minister was entitled, by settled law in Western Australia, to invoke the prohibition and restrictions contained in Pt IV, Div 2 of the Act. The Minister's defence to that effect ought to have been upheld by the District Court. The appellant's action for damages against the deemed "employer" was properly dismissed by the Court of Appeal. Orders To give effect to these conclusions, special leave should not be revoked. The appeal should be determined on its merits in the usual way. It should be dismissed with costs. 80 [2006] HCATrans 576 at 2435. 81 Reasons of Gleeson CJ at [3].

HIGH COURT OF AUSTRALIA Matter No M57/2020 MINISTER FOR HOME AFFAIRS APPELLANT AND DUA16 & ANOR Matter No M58/2020 RESPONDENTS MINISTER FOR HOME AFFAIRS APPELLANT AND CHK16 & ANOR RESPONDENTS Minister for Home Affairs v DUA16 Minister for Home Affairs v CHK16 [2020] HCA 46 Date of Hearing: 14 October 2020 Date of Judgment: 9 December 2020 M57/2020 & M58/2020 ORDER Matter No M57/2020 Appeal allowed. Save as to costs, set aside the orders of the Full Court of the Federal Court of Australia made on 10 December 2019 and, in their place, order that: the appeal be allowed; and orders 1 and 2 of the orders of the Federal Circuit Court of Australia made on 30 April 2019 be set aside and, in their place, it be ordered that the application be dismissed. Matter No M58/2020 Appeal dismissed. On appeal from the Federal Court of Australia Representation G R Kennett SC with N M Wood for the appellant in both matters (instructed by Clayton Utz) G A Costello SC and A N P McBeth for the first respondent in both matters (instructed by Clothier Anderson Immigration Lawyers) Submitting appearance for the second respondent in both matters Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Minister for Home Affairs v DUA16 Minister for Home Affairs v CHK16 Immigration – Refugees – Application for protection visa – Immigration Assessment Authority ("Authority") – Review by Authority under Pt 7AA of Migration Act 1958 (Cth) – Where applicants engaged registered migration agent to provide submissions to Authority – Where agent fraudulently provided pro forma submissions – Where fraudulent submissions contained personal information relevant to a different person – Where Authority unaware of fraud but aware that submissions erroneously related to another individual – Where Authority disregarded information relating to another individual – Whether agent's fraud stultified Authority's review – Whether Authority's decision was vitiated by agent's fraud – Whether agent's fraud contributed in adverse way to exercise of any duty, function, or power by Authority – Whether Authority's failure to seek corrected legally unreasonable. submissions containing potentially new information Words and phrases – "agent", "fraud", "fraudulent submissions", "legal unreasonableness", "new information", "personal circumstances", "personal information", "practice direction", "statutory review function", "stultified", "submissions", "vitiate". Migration Act 1958 (Cth), Pt 7AA. KIEFEL CJ, BELL, KEANE, GORDON AND EDELMAN JJ. Introduction The Immigration Assessment Authority ("the Authority") has a Practice Direction inviting submissions from applicants for asylum on matters including whether there were any errors in a refusal of asylum by a delegate of the Minister. CHK16 and DUA16 paid a registered migration agent to provide submissions on their behalf. It was found, and it is now common ground, that the agent's conduct was fraudulent because it consisted of her concealing from her clients that she intended to use a pro forma submission with the belief that if she disclosed that to her clients they would not have been prepared to pay for her professional services. The agent acted fraudulently in up to 40 cases including in the cases of CHK16 and DUA16. In the case of CHK16, the agent, acting fraudulently, provided submissions where the entirety of the personal circumstances concerned the wrong person. The Authority was unaware of the agent's fraud. The Authority noticed that the submissions concerned the wrong person yet did not seek to obtain the correct submissions and any new information about the correct applicant. Instead, it had regard to the submissions concerning generic information and legal issues but disregarded the information concerning the personal circumstances of the wrong person. In the case of DUA16, the agent, again acting fraudulently, provided submissions that contained information relevant to DUA16's application and some information relevant to a different applicant. The Authority, constituted by a different member and again unaware of the fraud, concluded that those latter references had been included by mistake. In each case, a majority of the Full Court of the Federal Court of Australia concluded that the decision of the Authority was vitiated by the fraud of the agent. The Minister appeals from those decisions on the basis that the fraud had not been shown to have had any effect on a statutory function. By notices of contention, each of CHK16 and DUA16 contends that the Full Court's decision should be upheld because it was legally unreasonable for the Authority not to exercise its power to obtain corrected submissions, involving potentially new information, from the agent when it knew that the submissions concerned the wrong person either entirely or in part. For the reasons below, the decisions were not vitiated by the agent's fraud. As to the notices of contention, in the case of CHK16 it was legally unreasonable for the Authority not to exercise its statutory power to invite the agent to provide the correct submissions containing any new information but Bell Gordon Edelman in the case of DUA16 the Authority's failure to seek new information was not legally unreasonable. The first respondents' cases and their agent's fraud The written submissions made by each of CHK16 and DUA16 were prepared on their behalf by a registered migration agent who was also a solicitor. Each paid $600 to the agent to prepare such submissions. The agent said that in 40 cases the submissions that she prepared for the Authority were based upon a template from the first written submission that she had ever prepared. In some cases, the template submissions were not amended at all, and in other cases the template submissions were amended based upon instructions. The submissions made on behalf of CHK16 contained none of CHK16's personal information, rather they were the submissions concerned with a different person whose circumstances formed the basis of the template; CHK16 had not been asked for any new information and was not shown the submissions. The submissions made on behalf of DUA16 did involve amendments to the template to include his personal information. CHK16 CHK16 arrived in Australia in 2012 as an unauthorised maritime arrival. On 10 September 2015, he applied for a protection visa. The essence of CHK16's claim for protection was that he had become a person of interest to Sri Lankan authorities, who he feared would abuse him, because they wrongly suspected him to be a transporter for the Liberation Tigers of Tamil Eelam ("the LTTE"). He worked in a transport business which often required travel and deliveries around areas under the control of the LTTE. In 2012, he had borrowed money from a money lender but had not been able to repay on time. Following the default, the money lender allegedly complained to the authorities in order to make life difficult for CHK16. In March and May 2012, CHK16 was interrogated by members of the Criminal Investigation Department ("the CID") concerning an allegation that he had transported goods for the LTTE. He denied this allegation, but he was threatened and abused. The threats were to his life and the kidnap of his children. He continued to deny the allegations but was told that the process would continue. He sold his wife's jewellery to fund the cost of travel to Australia. Since his arrival in Australia, members of the CID have visited his family home on multiple occasions to ask for his location. After an interview, a delegate of the Minister refused his application. Bell Gordon Edelman As CHK16 was a fast track applicant, his application was referred by the Minister to the Authority for review1. The agent for CHK16 provided submissions to the Authority on his behalf. The submissions were slightly more than four pages. They bore the applicant's name and said that they were the product of his instructions. But the entirety of the personal detail in the submissions concerned a different person. For instance: The submissions asserted that the applicant "was reading a Human Rights degree at the University of Colombo at the time of his departure to Australia in 2013". CHK16 had arrived in Australia in 2012. He had described living in a refugee camp before commencing work as a transporter, but had never suggested that he had read for a human rights degree at the University of Colombo. The submissions asserted that the applicant had an actual or imputed political opinion of being opposed to the Sri Lankan Government and its lack of human rights practices. CHK16 had never asserted any such political opinions. (iii) The submissions asserted that the applicant was at risk as a media personality. CHK16 was not, and is not, a media personality. (iv) The submissions asserted that the applicant was at risk as an ex-policeman, and that the "applicant instructs that he will be killed if Sri Lankan Authorities find out he has divulged insider information only he knows, detailing human right abuses, he has witnessed, having been a senior police person with Sri Lanka Police". CHK16 was never a policeman. The submissions asserted that the applicant had assisted two separate organisations with their investigations into human rights violations. CHK16 had made no such claim. (vi) The submissions asserted that the delegate had erred by concluding that the applicant could relocate within Sri Lanka. The delegate had reached no such conclusion in relation to CHK16. The Authority had been provided by the Secretary with materials including the reasons for the delegate's decision and the material provided by CHK16 to the See Migration Act 1958 (Cth), s 473CA. Bell Gordon Edelman delegate2. The only logical conclusion that could be drawn from the contrast between that material and the written submissions is that the submissions and the wrong person. information provided by CHK16's agent concerned As Judge Riethmuller concluded in the Federal Circuit Court, CHK16 wished to put a claim for protection based on his own circumstances and he had relied upon his agent to do so. The agent had not asked CHK16 whether he wished to give any new information. Nor had she shown him the written submissions which she had prepared, despite having told him that he would need to make submissions and having charged him $600 for them. The written submissions were about a different person. The Authority expressed the natural concern that the claims made in the application "appear to have no logical bearing or connection to the applicant". The Authority was rightly satisfied that the personal circumstances were not intended to form part of CHK16's case. Nevertheless, the Authority took into account the generic aspects of the submissions – legal submissions and country information – although it disregarded specific reports that predated the decision of the delegate, did not contain credible personal information, and had not been before the delegate. The Authority affirmed the decision of the delegate. DUA16 DUA16 arrived in Australia in 2012 as an unauthorised maritime arrival. On 20 January 2016, he applied for a protection visa. He claimed protection as a Tamil whose parents were killed in 1999 by shelling and whose brother was abducted in 2008. DUA16 claimed that his brother was abducted by a group connected to the Sri Lankan army. DUA16 said that the Sri Lankan army searched his house shortly after his brother had been abducted and that, in fear, he had quit his job and gone into hiding. He said that "once in a while" the army would visit his brother's wife to ask for his location. His principal concern is that he would be thought to have supported the LTTE. The claim for protection by DUA16 was dismissed by a delegate of the Minister. As a fast track applicant, DUA16's application was referred by the Minister to the Authority for consideration. The agent prepared a four-page submission in support of DUA16's application by making amendments to a template document. See Migration Act, ss 473CB(1)(a), 473CB(1)(b). Bell Gordon Edelman The submissions referred to some of DUA16's personal circumstances. After an introductory section concerned with the law, the submissions commenced with reference to DUA16's loss of his parents in the war and one of his brothers still being missing. The submissions continued with later reference to DUA16's genuine fear of persecution by "the Sri Lankan government and the forces working alongside with the government". In contrast with these accurate references, two paragraphs of the submissions contained apparently erroneous material. One paragraph said that the applicant had been "arrested and detained and he has been persecuted by way of sexual abuse by the SLA. His brother who was arrested along side him has successfully sought asylum in Canada." Towards the conclusion of the submissions, a second paragraph, which was identical to a paragraph in the submissions for CHK16, said that "[t]he latest UNHCR guidelines specifically lists media personalities and ex-police men as 'at risk profiles' (the applicant belongs to both groups)". None of the matters in these two paragraphs was consistent with DUA16's case before the delegate. The Authority noticed the erroneous reference in the first paragraph described above. It drew a reasonable inference that "this part of the submission actually refers to another applicant, and appears in this submission in error". The Authority observed that in any event the requirements in s 473DD of the Migration Act 1958 (Cth) for consideration of new information had not been met. The erroneous reference in the second paragraph, described above, was disregarded. The Authority observed that "[o]therwise, the submission restates the applicant's claims and puts forward legal arguments addressing the delegate's decision". The Authority affirmed the decision of the delegate. Fraud that vitiates the exercise of a statutory duty, function, or power In SZFDE v Minister for Immigration and Citizenship3, this Court held that a decision of the Refugee Review Tribunal was correctly set aside in circumstances where a rogue had perpetrated a fraud on a family of applicants by falsely representing that he was a solicitor and a migration agent and dissuading the applicants from attending the Tribunal hearing. The fraud was also perpetrated on the Tribunal, whose decision to proceed in the absence of the applicants might not (2007) 232 CLR 189. Bell Gordon Edelman have been made if it had known about the misconduct4. This Court emphasised that the appeal required "close attention to the nature, scope and purpose of the particular system of review" rather than reliance upon maxims such as "fraud unravels everything"5. The rogue's fraud stultified the operation of the legislative scheme to afford natural justice to the applicants6. The insistence by this Court in SZFDE that a ground of review for fraud requires a focus upon the manner in which the fraud adversely affected the operation of the particular system of review, and therefore the statutory functions and powers of the Tribunal, was appropriate because grounds of judicial review arise by implication from the statute which provides the jurisdiction to make the decision7. Just as it is usually implied that a decision will be invalid if a decision- maker exercises their powers fraudulently8, so too it will usually be implied that a decision will be invalid if a decision-maker is defrauded in the exercise of statutory powers. The implication requires that some aspect of the operation of the legislative scheme be affected by actual fraud or dishonesty, not merely negligence9. As this Court said in SZFDE10, "there are sound reasons of policy" SZFDE v Minister for Immigration and Citizenship (2007) 232 CLR 189 at 202-203 SZFDE v Minister for Immigration and Citizenship (2007) 232 CLR 189 at 200-201 SZFDE v Minister for Immigration and Citizenship (2007) 232 CLR 189 at 206 [49]- 7 Attorney-General (NSW) v Quin (1990) 170 CLR 1 at 36; Hossain v Minister for Immigration and Border Protection (2018) 264 CLR 123 at 132 [23], 145 [66]. See Bodruddaza v Minister for Immigration and Multicultural Affairs (2007) 228 CLR 651 at 663 [28]. 9 Compare SZSXT v Minister for Immigration and Border Protection (2014) 222 FCR 73 at 85-86 [60]-[61] with Minister for Immigration and Citizenship v Le (2007) 164 FCR 151 at 172 [59]. (2007) 232 CLR 189 at 207 [53]. Bell Gordon Edelman why an administrative decision is not vitiated merely by bad or negligent advice or some other mishap that leads to detriment to an applicant. In the Federal Circuit Court, Judge Riethmuller correctly concluded that in the cases of both CHK16 and DUA16 the Authority had not been misled by the extraneous material nor had it been precluded from considering other material that was before it. However, his Honour set aside both decisions of the Authority on the basis that the proper performance of the Authority's functions had been stultified by the conduct of the agent11. An appeal to the Full Court of the Federal Court was dismissed by a majority of the Court. In the majority, Mortimer J found that the agent had made a series of false representations to the Authority which misled the Authority about (i) what the agent had been instructed to put to the Authority, (ii) the factual nature of the claims and their connection with applicable country information, and (iii) whether CHK16 and DUA16 had anything at all to say about why the Authority should accept the factual basis for their claims and its connection with the country information12. Her Honour concluded that the Authority's review had been subverted in each case because it determined the review by reference to matters which included the fraudulently provided submissions13. Wheelahan J generally agreed with Mortimer J, observing that the main feature of the first respondents' cases was that in the discharge of its statutory review function the Authority took account of submissions that contained false information and which were prepared in the ostensible discharge of a retainer that was procured dishonestly14. Griffiths J dissented. His Honour held that the Authority had been aware of the errors in the submissions and the Authority had not proceeded on the basis of a presumption of regularity15. 11 DUA16 v Minister for Immigration and Border Protection [2019] FCCA 1128 at 12 Minister for Home Affairs v DUA16 (2019) 273 FCR 213 at 249 [173]. 13 Minister for Home Affairs v DUA16 (2019) 273 FCR 213 at 249 [176]. 14 Minister for Home Affairs v DUA16 (2019) 273 FCR 213 at 251 [189]. 15 Minister for Home Affairs v DUA16 (2019) 273 FCR 213 at 230 [78]. Bell Gordon Edelman In this Court, the Minister correctly submitted that, as a ground of judicial review, fraud must affect a particular duty, function, or power of the Authority. It is not sufficient to assert that fraud might be said to affect the process of decision-making in some abstract sense. In oral submissions, CHK16 and DUA16 submitted that the agent's fraud had stultified the "core review function" in s 473CC. The only particular aspect of that core review function that was said to have been stultified was that the Authority had requested submissions in a Practice Direction and had received fraudulent submissions. for reconsideration The duty in s 473CC to conduct a review is contained in Div 2 of Pt 7AA. The Authority is required to affirm the fast track reviewable decision or remit the decision such directions or recommendations of the Authority as are permitted by regulation16. Section 473CC says nothing about the manner of conducting the review: the effect of sub-s (1) is to impose a duty on the Authority to reach a decision, with sub-s (2) providing for the decisions that may be reached. The manner in which the review must be conducted is the subject of Div 3 of Pt 7AA. in accordance with Whether or not the duty in s 473CC is properly described as a "core review function", it was a duty that was performed by the Authority. The Authority affirmed the decision of the delegate with respect to CHK16 and DUA16 respectively. Whatever effect the fraud might be said to have had on the manner or process of decision-making in the abstract, it did not prevent or affect the Authority's duty to conduct a review in accordance with the process described in Div 3 and to reach an outcome. The only particular power of the Authority upon which CHK16 and DUA16 relied as having been stultified by fraud was the power in s 473FB for the President of the Authority to issue Practice Directions. But although CHK16 and DUA16 were correct that the Authority had requested submissions in a Practice Direction made under that power, and that the Authority had received fraudulent submissions, the power to make Practice Directions was entirely unaffected by the agent's fraud. The effect of the agent's fraud on the action that either CHK16 or DUA16 would have taken to provide submissions and new information according to the Practice Direction did not affect the President's power to issue Practice Directions in the first place. In each of these appeals, the agent's fraud did not contribute in any adverse way to the exercise of any duty, function, or power by the Authority. The approach 16 Migration Act, s 473CC(2). Bell Gordon Edelman of Griffiths J in dissent was correct. Subject to the notices of contention concerning unreasonableness, the appeals should be allowed. Legal unreasonableness The Practice Direction issued by the President of the Authority in the exercise of the power in s 473FB permitted written submissions and new information and explanations to be provided to the Authority on matters including: "why you disagree with the decision of the Department". In the Federal Circuit Court, Judge Riethmuller found that CHK16 wished to put his claim for protection on the basis of his own circumstances and that DUA16 would have sought to provide more information if his agent had told him that he had the opportunity to do so17. In the Full Court of the Federal Court, each of CHK16 and DUA16 filed a notice of contention. One ground of their notices of contention, which it had not been necessary for Judge Riethmuller to consider, was that the Authority erred by failing to consider the exercise of its discretion in s 473DC of the Migration Act to obtain new information. This contention was dismissed. Griffiths J, with whom Mortimer and Wheelahan JJ agreed on this point, dismissed the contention because submissions are not "new information"18. In this Court, each of CHK16 and DUA16 relied upon a similar notice of contention, asserting the unreasonableness of the Authority making a decision on the review without first contacting CHK16 or DUA16 to seek clarification or to get new information under s 473DC. In this Court, the Minister correctly accepted that submissions that were made upon instructions from CHK16 or DUA16 might have contained new information. "New information" refers to documents or information of an evidentiary nature that were not before the Minister at the time of making the referred decision and which the Authority considers may be relevant19. In the 17 DUA16 v Minister for Immigration and Border Protection [2019] FCCA 1128 at 18 Minister for Home Affairs v DUA16 (2019) 273 FCR 213 at 233 [90]. See also at 234 [98] per Mortimer J, 250 [185] per Wheelahan J. 19 Migration Act, ss 473BB (definition of "new information"), 473DC(1). See AUS17 v Minister for Immigration and Border Protection (2020) 94 ALJR 1007 at 1009 [3]; Minister for Immigration and Border Protection v CED16 (2020) 94 ALJR 706 at 710-711 [21]; 380 ALR 216 at 222. Bell Gordon Edelman section of the Authority's Practice Direction concerned with applicants seeking to provide submissions, it was expressly contemplated that submissions might contain new information, with the Authority summarising the requirements in s 473DD before new information could be considered. Since new information can be contained, and might be expected to be contained, in submissions, the Authority's power in s 473DC to get new information plainly extended to getting submissions containing that new information. Therefore, Griffiths J erred by dismissing the notices of contention on the ground that submissions are not new information. It is necessary to consider whether, in the particular circumstances of each of CHK16 and DUA16, the failure of the Authority to exercise the power in s 473DC to get new information by inviting written submissions was legally unreasonable. A requirement of legal reasonableness in the exercise of a decision-maker's power is derived by implication from the statute20, including an implication of the required threshold of unreasonableness, which is usually high21. Any legal unreasonableness is to be judged at the time the power is exercised or should have been exercised22. It is not to be assessed through the lens of procedural fairness to the applicant23. Instead, whether the implied requirements of legal reasonableness have been satisfied requires a close focus upon the particular circumstances of exercise of the statutory power: the conclusion is drawn "from the facts and from the matters falling for consideration in the exercise of the statutory power"24. As Griffiths J correctly held in the Full Court, there is no general obligation on the Authority to advise referred applicants of their opportunities to present new 20 Minister for Immigration and Citizenship v Li (2013) 249 CLR 332 at 362 [63]. 21 Minister for Immigration and Border Protection v SZVFW (2018) 264 CLR 541 at 22 ABT17 v Minister for Immigration and Border Protection (2020) 94 ALJR 928 at 953-954 [101]; 383 ALR 407 at 437. 23 Minister for Immigration and Border Protection v CRY16 (2017) 253 FCR 475 at 491 [67]. See BVD17 v Minister for Immigration and Border Protection (2019) 93 ALJR 1091 at 1099 [34]; 373 ALR 196 at 204-205. 24 Minister for Immigration and Citizenship v Li (2013) 249 CLR 332 at 367 [76]. Bell Gordon Edelman information25. Nor is there any general obligation upon the Authority to get new information26. This is so even if the submissions are hopeless, or if they contain errors, even major errors, about facts or law. However, the power in s 473DC is still subject to the usual implication that it must be exercised within the bounds of legal reasonableness27. Hence, this Court has held that a decision can be invalid if it is made in circumstances which exceed the high threshold of legal unreasonableness for the Authority's failure to exercise the power in s 473DC to get new information28. The circumstances of CHK16's case are extreme. The Authority was aware that CHK16 intended to provide submissions and that the submissions might contain new information. But it was apparent, as the Authority realised, that the submissions provided by the agent concerned a different person and that none of the personal information related to CHK16. As the Authority was aware, this was the only opportunity that CHK16 would have to provide his own new information, which could be of considerable importance. On CHK16's case before the delegate, the consequences of refusal of his protection visa could place his life at risk. A request from the Authority for the correct submissions and CHK16's correct personal information would have been a very simple matter29. The Authority had, itself, indicated in its Practice Direction that submissions that were too long would to provide new submissions. be returned with an opportunity given These circumstances reflect the observation of six members of this Court in Minister for Immigration and Citizenship v SZIAI30: "The failure of an administrative decision-maker to make inquiry into factual matters which can readily be determined and are of critical significance to a decision made under statutory authority, has sometimes 25 Minister for Home Affairs v DUA16 (2019) 273 FCR 213 at 228 [68]. 26 Migration Act, s 473DC(2). 27 Plaintiff M174/2016 v Minister for Immigration and Border Protection (2018) 264 CLR 217 at 227 [21], 245 [86], 249 [97]. 28 ABT17 v Minister for Immigration and Border Protection (2020) 94 ALJR 928; 383 ALR 407. 29 cf Wei v Minister for Immigration and Border Protection (2015) 257 CLR 22 at 40- (2009) 83 ALJR 1123 at 1128 [20]; 259 ALR 429 at 434. Bell Gordon Edelman been said to support characterisation of the decision as an exercise of power so unreasonable that no reasonable person would have so exercised it." The legal unreasonableness of the failure by the Authority to get new information by requesting the correct submissions pursuant to s 473DC is plain when the alternative approach taken by the Authority is considered. Rather than taking the simple route of asking for the correct submissions, consistently with its own procedures for returning submissions that are too long, the Authority filleted the submissions that plainly concerned the wrong person into generic and non-generic information. The Authority then treated the generic information in the submissions concerning another person as though the information had been correctly provided in relation to CHK16's circumstances. On no view could that have been a reasonable course to take. The Minister submitted that an integer that militates against a conclusion of unreasonableness for a failure to inquire is the lack of any possibility of a useful result. So much can be accepted. If the Authority could not have reasonably expected any useful result it could not be unreasonable for it to fail to invite CHK16 to provide submissions with any new information31. But, contrary to the Minister's submissions, there are two reasons which indicate that the Authority might reasonably have expected a useful result from the agent. First, the Authority did not suspect that the agent was fraudulent. A plausible inference would simply have been that the agent had provided the wrong submissions. On that basis, the most likely outcome of an invitation to provide the correct submissions, containing any new information, would have been that they would be provided. Secondly, and in any event, even if the Authority had suspected fraud the most likely response by a fraudulent agent to an invitation to provide correct submissions with new information would have been to do so. The notices of contention were expressed in terms of the unreasonable failure by the Authority to exercise its power under s 473DC. In oral submissions, the first respondents contended that the same conclusion could be reached on the basis of unreasonableness in the exercise of the Authority's general powers in the conduct of the review. The exercise of powers and functions by the Authority is addressed in Div 5. Section 473FB, in Div 5, provides that the President of the Authority may issue a written direction as to the conduct of reviews by the Authority. As explained above, the Practice Direction issued by the President told referred applicants that the Authority invited and would accept submissions for the 31 Minister for Immigration and Citizenship v SZIAI (2009) 83 ALJR 1123; 259 ALR Bell Gordon Edelman purposes of the review. After submissions were provided to the Authority on behalf of CHK16 which did not relate to CHK16's case, and which were understood by the Authority not to relate to CHK16's case, it was legally unreasonable for the Authority not to ask why the submissions did not relate to CHK16's case. That is, no reasonable decision-maker would have decided the review without making further inquiry. Sections 473FB(3) and 473FB(4) do not detract from this conclusion. There was no suggestion, nor could there be, that the Practice Direction was not complied with or that it was not practicable for the Authority to make further inquiry. The steps were simple. But the submissions that the Authority had invited CHK16 to provide, and which were provided and then considered by the Authority, concerned another referred applicant. The Authority found that the submissions did not concern or relate to CHK16. The failure of the Authority to make any further inquiry was legally unreasonable. No issue arises as to the effect of materiality upon this legal unreasonableness. The Minister properly accepted that it would be a difficult proposition to assert that any coherent and forceful submission that CHK16 might have provided could not have made a difference to his case. He expressly disclaimed a submission that a better submission by CHK16 could not possibly have made a difference. That reasoning must include new information contained in the submission. DUA16's case is different. In DUA16's case it was not legally unreasonable for the Authority to fail to exercise either its powers under s 473DC to get new information or its powers in the general conduct of the review to get new submissions. The conclusion that the Authority reasonably drew from the submissions with which it was presented, and by having regard to the review material, was that a small amount of the information had been included by mistake. The Authority disregarded these errors and, moreover, pointed out that the requirements in s 473DD of the Migration Act for consideration of new information had not been met. The statutory context and the high threshold of legal unreasonableness precludes a conclusion that it could be legally unreasonable for the Authority to fail to get new information in light of what it reasonably identified as errors in submissions. It was reasonable for the Authority to disregard that information and to explain, in the alternative, why the information could not be considered even if it had not been included by mistake. Bell Gordon Edelman Conclusion and orders Special leave was granted in each of these appeals subject to the Minister's undertaking to pay the reasonable costs of the first respondent in each of the applications for special leave and the appeals, and not to disturb the costs orders below. In Minister for Home Affairs v CHK16, orders should be made dismissing the appeal. In Minister for Home Affairs v DUA16, orders should be made as follows: Appeal allowed. Save as to costs, set aside the orders of the Full Court of the Federal Court of Australia made on 10 December 2019 and, in their place, order that: the appeal be allowed; and orders 1 and 2 of the orders of the Federal Circuit Court of Australia made on 30 April 2019 be set aside and, in their place, it be ordered that the application be dismissed.

HIGH COURT OF AUSTRALIA Matter No M105/2017 PLAINTIFFS AND THE COMMONWEALTH OF AUSTRALIA & ORS DEFENDANTS Matter No M106/2017 AUSTRALIAN MARRIAGE EQUALITY LTD & ANOR PLAINTIFFS AND MINISTER FOR FINANCE MATHIAS CORMANN & ANOR DEFENDANTS Australian Marriage Equality Ltd v Cormann [2017] HCA 40 Date of Order: 7 September 2017 Date of Publication of Reasons: 28 September 2017 M105/2017 & M106/2017 ORDER Matter No M105/2017 Application dismissed. The plaintiffs pay the costs of the first to third defendants. Matter No M106/2017 Questions 2, 3 and 5 of the Special Case dated 21 August 2017 be amended and the questions stated in the Special Case (as so amended) be answered as follows: Question 1 Do either of the plaintiffs have standing to seek the relief sought in the Amended Statement of Claim? Answer Inappropriate to answer. Question 2 Is the Advance to the Finance Minister Determination (No 1 of 2017-2018) (Cth) ("the Determination") invalid by reason that the criterion in s 10(1)(b) of the Appropriation Act (No 1) 2017-2018 (Cth) ("the 2017- 2018 Act") was not met such that the Finance Minister's power to issue the Determination was not enlivened? Answer No, it is not invalid. Question 3 (a) Does question 3(b) raise an issue which is justiciable by a court and within the scope of any matter which the Court has authority to decide? If the answer to question 3(a) is yes, is the Determination invalid by reason that: on its proper construction, s 10 of the 2017-2018 Act does not authorise the Finance Minister to make a determination, the effect of which is that the 2017-2018 Act takes effect as if Schedule 1 thereto were amended to make provision for expenditure that is outside the ordinary annual services of the Government; and the expenditure on the ABS Activity (being the activity described in the Census and Statistics (Statistical Information) Direction 2017 (Cth)) is not within the meaning of "ordinary annual services of the Government"? Answer The proper construction of s 10 of the 2017-2018 Act is justiciable. (b) No. Section 10, on its proper construction, did authorise the Finance Minister to make the Determination. Question 4 If the answer to question 2 or question 3(b) is yes: does question 4(b) raise an issue which is justiciable by a court and within the scope of any matter which the Court has authority to decide? if the answer to question 4(a) is yes, would the drawing of money from the Treasury of the Commonwealth for the ABS Activity in reliance on the appropriation for the departmental item for the the 2017-2018 Act be [Australian Bureau of Statistics] unauthorised by the 2017-2018 Act on the basis that the expenditure is not within the meaning of "ordinary annual services of the Government"? Answer The question does not arise. Question 5 What, if any, relief sought in the Amended Statement of Claim should the plaintiffs be granted? Answer None. Question 6 Who should pay the costs of this special case? Answer The plaintiffs should pay the costs of the special case. Representation R Merkel QC and K E Foley with C J Tran for the plaintiffs in M105/2017 (instructed by Public Interest Advocacy Centre) K M Richardson SC with J S Emmett, G E S Ng and S Palaniappan for the plaintiffs in M106/2017 (instructed by Human Rights Law Centre) S P Donaghue QC, Solicitor-General of the Commonwealth with M J O'Meara and B K Lim for the first to third defendants in M105/2017, for the first defendant in M106/2017, and for the Attorney-General of the Commonwealth, intervening in M106/2017 (instructed by Australian Government Solicitor) Submitting appearances for the fourth and fifth defendants in M105/2017 and for the second defendant in M106/2017 Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Australian Marriage Equality Ltd v Cormann Constitutional law (Cth) – Appropriation of moneys from Consolidated Revenue Fund – Construction of Appropriation Act (No 1) 2017-2018 (Cth) – Where Finance Minister made determination under s 10(2) of Appropriation Act (No 1) 2017-2018 (Cth) – Where determination sought to provide funding for postal survey – Whether s 10 of Appropriation Act (No 1) 2017-2018 (Cth) invalid – Whether appropriation for purpose Parliament lawfully determined may be carried out. Statutes – Construction of Appropriation Act (No 1) 2017-2018 (Cth) – Power of Finance Minister to make determination under s 10(2) of Appropriation Act (No 1) 2017-2018 (Cth) – Whether determination made by Finance Minister authorised by s 10 – Whether Finance Minister satisfied urgent need for expenditure not provided for or insufficiently provided for because expenditure unforeseen – Whether Finance Minister erred in law by conflating satisfaction as to urgent need for expenditure with satisfaction as to expenditure being unforeseen – Whether s 10 limited by description of Appropriation Act (No 1) 2017-2018 (Cth) as Act for ordinary annual services of Government. Statutes – Delegated legislation – Validity – Whether direction to Australian Statistician exceeded power of Treasurer under s 9(1)(b) of Census and Statistics Act 1905 (Cth) – Whether information to be collected statistical information – Whether information to be collected in relation to matters prescribed in s 13 of Census and Statistics Regulation 2016 (Cth) – Whether Treasurer had power to specify from whom to be collected – Whether s 7A of Commonwealth Electoral Act 1918 (Cth) gave Australian Electoral Commission authority to assist Australian Bureau of Statistics in implementing direction. information Constitutional law (Cth) – Appropriation of moneys from Consolidated Revenue Fund – Standing to bring action for declarations and injunctions – Whether necessary or appropriate to determine if plaintiffs have standing – Standing of Member of House of Representatives – Standing of Senator – Standing of elector – Standing of incorporated body – Standing of association. Words and phrases – "Advance to the Finance Minister", "appropriation", "Australian Bureau of Statistics", "Australian Electoral Commission", "Australian Statistician", "Consolidated Revenue Fund", "departmental item", "Electoral Commissioner", "expenditure", "Finance Minister", "ordinary annual services of the Government", "plebiscite", "Treasurer", "unforeseen", "urgent need for expenditure". Constitution, ss 53, 54, 56, 81, 83. Appropriation Act (No 1) 2017-2018 (Cth), ss 3, 6, 7, 10, 12, Sched 1. Audit Act 1901 (Cth), s 36A. Australian Bureau of Statistics Act 1975 (Cth), s 16A. Census and Statistics Act 1905 (Cth), s 9. Census and Statistics Regulation 2016 (Cth), s 13. Commonwealth Electoral Act 1918 (Cth), ss 7, 7A. Legislation Act 2003 (Cth), ss 15G, 15H, 15J, 38, 39. Public Governance, Performance and Accountability Act 2013 (Cth), ss 74, 75. KIEFEL CJ, BELL, GAGELER, KEANE, NETTLE, GORDON AND EDELMAN JJ. Two proceedings, each commenced in the original jurisdiction of the High Court on 10 August 2017, challenged the lawfulness of measures taken and proposed to be taken pursuant to statute to implement the decision of the Australian Government, made on 7 August 2017 and announced unconditionally on 9 August 2017, to direct and to fund the conduct of a survey of the views of Australian electors on the question of whether the law should be changed to allow same-sex couples to marry. The Full Court of the High Court heard the proceedings on 5 and 6 September 2017 and, on 7 September 2017, made orders dismissing one proceeding and giving answers to questions reserved in the other proceeding rejecting the challenge on its merits. These are the reasons for those orders. These reasons commence with a narrative of the background to the proceedings in the course of which the terms of the relevant statutes are set out. They then describe the proceedings and note an unresolved question of standing before explaining systematically why the challenge in each proceeding failed on its merits. The proposed plebiscite The Marriage Act 1961 (Cth) ("the Marriage Act"), enacted by the Commonwealth Parliament under s 51(xxi) of the Constitution, has since 20041 defined "marriage" to mean "the union of a man and a woman to the exclusion of all others, voluntarily entered into for life"2. The Court made clear in The Commonwealth v Australian Capital Territory3 that s 51(xxi) of the Constitution is capable of supporting a law defining marriage to include the union of two persons of the same sex. On 11 August 2015, the then Prime Minister announced that a Liberal and National Party Government would consider holding a plebiscite on same-sex 1 Section 3 and Sched 1, item 1 of the Marriage Amendment Act 2004 (Cth). 2 Section 5(1) of the Marriage Act. (2013) 250 CLR 441; [2013] HCA 55. Bell Nettle Gordon Edelman marriage. A Liberal and National Party Government was re-elected at the general election on 2 July 2016. On 13 September 2016, the Attorney-General and the Special Minister of State jointly announced the intention of the Government for the Australian Electoral Commission ("the AEC"), established under the Commonwealth Electoral Act 1918 (Cth) ("the Electoral Act"), to conduct a plebiscite to ask voters whether the law should be changed to allow same-sex couples to marry. The announcement stated that voting would be compulsory, that the outcome would be determined by a simple majority of votes, and that if the plebiscite passed then the Parliament would promptly amend the Marriage Act to enable same-sex couples to marry. The announcement stated that by having the AEC conduct the plebiscite, the Government was "delivering its election commitment to give the community a say on whether same-sex marriage should be legalised". The announcement also stated that the Government had budgeted $170 million to run the plebiscite. On 14 September 2016, the Plebiscite (Same-Sex Marriage) Bill 2016 ("the 2016 Bill") was introduced into the House of Representatives. The 2016 Bill, if enacted, would have provided for the Governor-General, by writ issued within 120 days after its commencement, to cause a national plebiscite to be conducted by the AEC, in much the same way as a referendum is conducted under the Referendum (Machinery Provisions) Act 1984 (Cth). The 2016 Bill identified the question to be submitted to electors at the plebiscite as: "Should the law be changed to allow same-sex couples to marry?"4 The 2016 Bill stated that the result of the plebiscite would be in favour of the plebiscite proposal if, disregarding informal ballot-papers, more than 50 per cent of the votes cast in the plebiscite were given in favour of the plebiscite proposal5. The 2016 Bill went on to include provision to the effect that the Consolidated Revenue Fund was appropriated for the purposes of "paying or discharging the costs, expenses and other obligations incurred by the Commonwealth in relation to the plebiscite"6. 4 Clause 5(2) of the 2016 Bill. 5 Clause 6 of the 2016 Bill. 6 Clause 40(a) of the 2016 Bill. Bell Nettle Gordon Edelman The 2016 Bill was passed by the House of Representatives on 20 October 2016 but was defeated in the Senate on 7 November 2016. The annual budget On Tuesday, 9 May 2017, in accordance with conventional timing, the Treasurer presented the annual Commonwealth budget in the course of moving in the House of Representatives that Appropriation Bill (No 1) 2017-2018 ("Appropriation Bill No 1 2017-2018") be read for a second time. Because of production timeframes, including the financial consolidation process, proofing and printing, the last day on which it was practicable to provide for expenditure in Appropriation Bill No 1 2017-2018 was Friday, 5 May 2017. The Charter of Budget Honesty Act 1998 (Cth) ("the CBH Act") requires that the Treasurer table and publicly release at the time of a budget a fiscal strategy statement7 together with a budget economic and fiscal outlook report8. The fiscal strategy statement is required, amongst other things, to specify the Government's fiscal objectives and targets for the budget year and the following three financial years9. The budget economic and fiscal outlook report is required, amongst other things, to contain "a statement of the risks ... that may have a material effect on the fiscal outlook"10. At the time of the budget, on 9 May 2017, the Treasurer accordingly tabled and publicly released "Budget Strategy and Outlook Budget Paper No 1 2017-18" ("Budget Paper No 1"), which contained both a fiscal strategy statement and a budget economic and fiscal outlook report. Budget Paper No 1 comprised a number of "Statements", one of which was headed "Statement of Risks". The Statement of Risks explained that it disclosed, amongst other things, "fiscal risks with a possible impact on the forward estimates greater than 7 Clauses 2(2) and 6 of Sched 1 to the CBH Act. 8 Clause 10 of Sched 1 to the CBH Act. 9 Clause 9(1)(d)(i) of Sched 1 to the CBH Act. 10 Clause 12(1)(e) of Sched 1 to the CBH Act. Bell Nettle Gordon Edelman $20 million in any one year, or $50 million over the forward estimates period". The Statement of Risks used "possible" in contradistinction to "probable", which it explained as describing items having a "50 per cent or higher chance of occurrence"11. Under the heading "Fiscal risks", the Statement of Risks explained12: "Fiscal risks comprise general developments or specific events that may affect the fiscal outlook. Some developments or events raise the possibility of a fiscal impact. In other cases, the likelihood of a fiscal impact may be reasonably certain, but will not be included in the forward estimates because the timing or magnitude is not known." Under the sub-heading "Finance", the Statement of Risks went on to "The Australian Government remains committed to a plebiscite in relation to same-sex marriage, despite the Senate not supporting the Plebiscite (Same-Sex Marriage) Bill 2016. To this end, the Australian Government will provide $170 million to conduct a same-sex marriage plebiscite as soon as the necessary legislation is enacted by the Parliament." Appropriation Act (No 1) 2017-2018 (Cth) Appropriation Act (No 1) 2017-2018 (Cth) ("Appropriation Act No 1 2017-2018"), the long title of which is "[a]n Act to appropriate money out of the Consolidated Revenue Fund for the ordinary annual services of the Government, and for related purposes", was in due course enacted. Appropriation Act No 1 11 Budget Paper No 1 at 9-4, table 1. 12 Budget Paper No 1 at 9-10. 13 Budget Paper No 1 at 9-11. Bell Nettle Gordon Edelman 2017-2018 is expressed to have commenced on 1 July 201714 and to remain in force until the start of 1 July 202015. Schedule 1 to Appropriation Act No 1 2017-2018 specifies "[s]ervices for which money is appropriated". The Schedule does so by setting out, in tabular form listed by Ministerial portfolio, specified dollar amounts in relation to identified "non-corporate entities" under the headings "administered" items and "departmental" items. To each such "item" is ascribed an "outcome". Section 6 of Appropriation Act No 1 2017-2018 states that the total of the items specified in Sched 1 is $88,751,598,000. There are two notes to s 6, each of which forms part of Appropriation Act No 1 2017-201816. One note states that items in Sched 1 can be adjusted under Pt 3 of Appropriation Act No 1 2017-2018. The sole section within Pt 3 is s 10. The other note states that ss 74 to 75 of the Public Governance, Performance and Accountability Act 2013 (Cth) ("the PGPA Act") also provide for adjustment of amounts appropriated by Appropriation Act No 1 2017-2018. Those sections will be referred to later in these reasons. Non-corporate entities within the meaning of Appropriation Act No 1 2017-2018 include "non-corporate Commonwealth entit[ies]" within the meaning of the PGPA Act17. Non-corporate Commonwealth entities of that description include Departments of State18 as well as "any body (except a body corporate)" that is prescribed to be a "listed entity"19. The PGPA Act states that each such entity has an "accountable authority"20, who has duties which include governing 14 Section 2 of Appropriation Act No 1 2017-2018. 15 Section 13 of Appropriation Act No 1 2017-2018. 16 Section 13(1) of the Acts Interpretation Act 1901 (Cth). 17 Section 3 (definition of "non-corporate entity") of Appropriation Act No 1 18 Sections 10(1)(a) and 11(b) of the PGPA Act. 19 Sections 8 (definition of "listed entity") and 10(1)(c) of the PGPA Act. 20 Sections 8 (definition of "accountable authority") and 12(1) of the PGPA Act. Bell Nettle Gordon Edelman the entity in a way that promotes the proper use of appropriations for which the entity is responsible21, and who in the case of a listed entity is the person or group of persons prescribed as the accountable authority of that entity22. One of the non-corporate entities listed in Sched 1 to Appropriation Act No 1 2017-2018 is the Australian Bureau of Statistics ("the ABS"), established by the Australian Bureau of Statistics Act 1975 (Cth) ("the ABS Act"). The ABS Act provides that the ABS consists of the Australian Statistician and staff engaged or providing services under the Public Service Act 1999 (Cth)23. The ABS Act also prescribes that the ABS is a listed entity and that the Australian Statistician is its accountable authority24. In respect of the ABS, Sched 1 to Appropriation Act No 1 2017-2018 sets out the following table: 21 Sections 8 (definition of "public resources") and 15(1)(a) of the PGPA Act. 22 Section 12(2), item 3 of the PGPA Act. 23 Section 5(1)-(3) of the ABS Act. 24 Section 5(5)(a) and (b) of the ABS Act. Bell Nettle Gordon Edelman TREASURY PORTFOLIO Appropriation (plain figures)—2017-2018 Actual Available Appropriation (italic figures)—2016-2017 AUSTRALIAN BUREAU OF STATISTICS Outcome 1 - Decisions on important matters made by governments, business and the broader community are informed by objective, relevant and trusted official statistics produced through the collection and integration of data, its analysis, and the provision of statistical information Total: Australian Bureau of Statistics Departmental Administered Total "Departmental item" is defined in Appropriation Act No 1 2017-2018 to mean "the total amount set out in Schedule 1 in relation to a non-corporate entity under the heading 'Departmental'"25. A note to that definition, which also forms part of the Act, states: "The amounts set out opposite outcomes, under the heading 'Departmental', are 'notional'. They are not part of the item, and do not in any way restrict the scope of the expenditure authorised by the item." Section 7 of Appropriation Act No 1 2017-2018 provides that "[t]he amount specified in a departmental item for a non-corporate entity may be applied for the departmental expenditure of the entity". "Departmental expenditure" is not defined, but "expenditure" is defined to mean "payments for expenses, acquiring assets, making loans or paying liabilities"26. 25 Section 3 of Appropriation Act No 1 2017-2018. 26 Section 3 of Appropriation Act No 1 2017-2018. Bell Nettle Gordon Edelman Section 10 of Appropriation Act No 1 2017-2018, which was the central focus of the challenge in each proceeding, is headed "Advance to the Finance Minister". Section 10 provides: "(1) This section applies if the Finance Minister is satisfied that there is an urgent need for expenditure, in the current year, that is not provided for, or is insufficiently provided for, in Schedule 1: because of an erroneous omission or understatement; or because the expenditure was unforeseen until after the last day on which it was practicable to provide for it in the Bill for this Act before that Bill was introduced into the House of Representatives. This Act has effect as if Schedule 1 were amended, in accordance with a determination of the Finance Minister, to make provision for so much (if any) of the expenditure as the Finance Minister determines. The total of the amounts determined under subsection (2) cannot be more than $295 million. (4) A determination made under subsection (2) is a legislative instrument, but neither section 42 (disallowance) nor Part 4 of Chapter 3 (sunsetting) of the Legislation Act 2003 applies to the determination." Section 12 of Appropriation Act No 1 2017-2018 provides: "The Consolidated Revenue Fund is appropriated as necessary for the purposes of this Act, including the operation of this Act as affected by the Public Governance, Performance and Accountability Act 2013." The Government decision On 8 August 2017, the Finance Minister announced a decision of the Government which had been made in a meeting of Cabinet on 7 August 2017. The Finance Minister's announcement was prefaced by a statement that the Government was "committed to deliver on its pre-election promise to give the Australian people a say on whether or not the law should be changed to allow Bell Nettle Gordon Edelman same-sex couples to marry" and that the Government's preference was "to deliver on that commitment through a compulsory attendance plebiscite" in accordance with the 2016 Bill and "for such a plebiscite to take place on 25 November The decision of the Government which the Finance Minister then announced was to re-introduce the 2016 Bill into the Senate and, in the event that the Senate failed again to pass the 2016 Bill, to proceed with a "voluntary postal plebiscite for all Australians enrolled on the Commonwealth Electoral Roll with final results known no later than 15 November 2017". The Finance Minister indicated that the "voluntary postal plebiscite" would be conducted by the ABS, which would exercise statutory power to request information from electors on the question of whether the law should be changed to allow same-sex couples to marry. The Finance Minister also indicated that an appropriation would be made to the ABS from the Advance to the Finance Minister under Appropriation Act On 9 August 2017, the 2016 Bill was sought to be re-introduced into the Senate and was again defeated. Following that defeat, and consistently with the decision of the Government announced the previous day, the Finance Minister on 9 August 2017 announced that "the Government [was] now pressing ahead with a voluntary postal plebiscite for all Australians". He explained that he had been advised by the Treasurer that the Treasurer would later that day issue a direction to the Australian Statistician asking that the ABS request on a voluntary basis statistical information from all Australians on the electoral roll as to their views on whether or not the law in relation to same-sex marriage should be changed to allow same- sex couples to marry. He stated that, while the ABS, "supported by AEC officers as appropriate", would make relevant announcements, it was anticipated that envelopes would begin to be posted by the ABS from 12 September, that all responses would have to be received by 7 November, and that the result would be announced on 15 November 2017. He also explained that he had himself that day made a determination under s 10 of Appropriation Act No 1 2017-2018 "to provide funding of $122 million to the ABS to enable them to fulfil the Treasurer's direction". Bell Nettle Gordon Edelman The Finance Minister's Determination The determination which the Finance Minister made on 9 August 2017 was in the form of an instrument styled "Advance to the Finance Minister Determination (No 1 of 2017-2018)" ("the Finance Determination"). The Finance Determination states: I, Mathias Hubert Paul Cormann, Minister for Finance, being satisfied of the matters set out in subsection 10(1) of Appropriation Act (No. 1) 2017-2018 (the Act), make the following determination under subsection 10(2) of the Act: That the Act have effect as if Schedule 1 of the Act were amended so that the item described in Column 1 of the Table, for the Entity listed in Column 2 of the Table, were increased by the amount listed in Column 3 of the Table. Table Column 1 Item Appropriation Item Column 2 Entity Appropriation Act (No. 1) 2017-2018 Departmental item Australian Bureau of Statistics Column 3 Amount By force of s 10(2) of Appropriation Act No 1 2017-2018, that Act has effect as if Sched 1 were amended in accordance with the Finance Determination. The immediate effect of the Finance Determination was thereby to increase the departmental item in relation to the ABS, being the total amount set out in Sched 1 in relation to the ABS under the heading "Departmental", from $348,865,000 to $470,865,000. The result of that increase in the departmental item in relation to the ABS was to increase from $348,865,000 to $470,865,000 the total amount that s 7 permits to be applied for the departmental expenditure of the ABS, which expenditure can include but is not restricted to expenditure on carrying out activities directed to the outcome stated in Sched 1 that "[d]ecisions on important matters made by governments, business and the broader community are informed by objective, relevant and trusted official statistics produced through the collection and integration of data, its analysis, and the provision of statistical information". No argument was put in either proceeding that the activities to be carried out by the ABS to fulfil the Treasurer's direction were incapable of answering the description of activities directed to that broadly stated outcome. Bell Nettle Gordon Edelman Because a determination made under s 10(2) of Appropriation Act No 1 2017-2018 is declared by s 10(4) of that Act to be a legislative instrument, the Legislation Act 2003 (Cth) ("the Legislation Act") operated to require that the Finance Determination be lodged for registration on the Federal Register of Legislation27 together with an explanatory statement which was required to be "approved" by the Finance Minister28, and which was required to "explain the purpose and operation of the instrument"29. Once the Finance Determination was lodged, the First Parliamentary Counsel came under a duty to register it30, the Office of Parliamentary Counsel came under a duty to deliver a copy of it to each House of the Parliament to be laid before each House within six sitting days of that House after the registration31, and the Office of Parliamentary Counsel came under a further duty to arrange for a copy of the explanatory statement to be delivered to each House of the Parliament also to be laid before each House32. The Finance Determination was accordingly accompanied, when made, by an Explanatory Statement. Under the heading "Purpose of the Determination", the Explanatory Statement stated: "On 8 August 2017, the Government announced that it will recommit the Plebiscite (Same-Sex Marriage) Bill 2016 to a vote in the Senate and if the Senate does not pass the bill, proceed with a voluntary postal plebiscite for all Australians enrolled on the Commonwealth Electoral Roll conducted by the Australian Bureau of Statistics (ABS). As the Senate has not passed the Plebiscite (Same-Sex Marriage) Bill 2016, funding is being made available to the ABS to undertake the voluntary postal plebiscite. The Government has also announced that the 27 Section 15G(1) of the Legislation Act. 28 Sections 15G(4) and 15J(2)(a) of the Legislation Act. 29 Section 15J(2)(b) of the Legislation Act. 30 Section 15H(1)(a) of the Legislation Act. 31 Section 38(1) of the Legislation Act. 32 Section 39 of the Legislation Act. Bell Nettle Gordon Edelman final result of the voluntary postal plebiscite is to be known no later than 15 November 2017. These government decisions were not made until after the Appropriation Bill (No 1) 2017-2018 was introduced into the House of Representatives on Tuesday, 9 May 2017. These circumstances meet the requirements of section 10 of the Act regarding the expenditure being urgent because it was unforeseen." Following the commencement of the proceedings, the Finance Minister swore an affidavit, which has been filed and read in each proceeding, in which he explained on oath his reasons for making the Finance Determination. The Finance Minister explains: "From about March 2017 to August 2017 I was aware of suggestions from Ministerial colleagues of alternative means by which the Government's policy of conducting a plebiscite on the issue of whether the law should be changed to allow same-sex couples to marry might be pursued. So far as I was aware, none of these suggestions involved the Australian Bureau of Statistics (ABS) or the conduct by the ABS of a postal survey on the issue of same-sex marriage. Those suggestions did not then represent Government policy and I had not personally decided to support them." After referring to the announcement on 8 August 2017 of the decision of the Government made on 7 August 2017, the Finance Minister explains that before 7 August 2017 "it had not been Government policy for the ABS to carry out a survey in relation to whether the law should be changed to allow same sex couples to marry". The Finance Minister's explanation of his reasons for making the Finance Determination concludes with the following statement: "When making the Determination I was satisfied that there was an urgent need for the expenditure provided for in the Determination which had not been provided for in the 2017-2018 Act because that expenditure was unforeseen until the last day it was practical to provide for it in the 2017-2018 Bill before that Bill was introduced into the House of Representatives; that day, being 5 May 2017. I was satisfied that the expenditure was not provided for in that Bill because, at the time that Bill Bell Nettle Gordon Edelman was introduced, it was not the Government's policy that the ABS should conduct a postal survey on the issue of same sex marriage, and I did not foresee the Government's decision on 7 August 2017 that the ABS should conduct such a survey. I was satisfied that the expenditure was urgent because the Government had, as part of its decision on 7 August 2017 to direct the ABS to conduct a postal survey on same sex marriage, decided that the results of the survey were to be known no later than 15 November Importantly, the Finance Minister's evidence is unchallenged by the plaintiffs in either proceeding. The Treasurer's Direction The direction of which the Finance Minister had been advised on 9 August 2017 was given by the Treasurer later that day in the form of an instrument styled "Census and Statistics (Statistical Information) Direction 2017" ("the Statistics Direction"), and was amended by the Finance Minister a week later by a further instrument styled "Census and Statistics (Statistical Information) Amendment Direction 2017". Section 9(1) of the Census and Statistics Act 1905 (Cth) ("the Statistics Act") provides: "The Statistician: (a) may from time to time collect such statistical information in relation to the matters prescribed for the purposes of this section as he or she considers appropriate; and shall, if the Minister so directs by notice in writing, collect such statistical information in relation to the matters so prescribed as is specified in the notice." Section 13 of the Census and Statistics Regulation 2016 (Cth) ("the Statistics Regulation") prescribes 52 matters for the purposes of s 9 of the Statistics Act by listing them in a table and ascribing to each of them an item number. The prescribed matters include "Births, deaths, marriages and divorces" (item 5), "Law" (item 30) and "Population and the social, economic and demographic characteristics of the population" (item 38). Bell Nettle Gordon Edelman The Statistics Direction in its original form was, and in its amended form is, expressed to be a direction to the Australian Statistician under s 9(1)(b) of the Statistics Act. It states in material part33: "The Statistician is to collect the following statistical information in relation to matters prescribed for the purposes of section 9 of the Statistics Act (in particular, one or more of items 5, 30 and 38 in the table in regulation 13 of the Census and Statistics Regulation 2016): statistical information about the proportion of electors who wish to express a view about whether the law should be changed to allow same-sex couples to marry (participating electors); statistical information about the proportion of participating electors who are in favour of the law being changed to allow same-sex couples to marry; statistical information about the proportion of participating electors who are against the law being changed to allow same-sex couples to marry." The Statistics Direction, as amended, goes on to require the "statistical information identified" to be published on or before 15 November 201734 and to define as an "elector", subject to immaterial qualifications and exceptions, a person who at the end of 24 August 2017 was an elector or had made a valid application for enrolment as an elector under the Electoral Act35. The Australian Statistician and the AEC As at the end of 24 August 2017, approximately 16 million electors were enrolled under the Electoral Act. 33 Section 3(1) of the Statistics Direction. 34 Section 3(3) of the Statistics Direction. 35 Section 3(4) of the Statistics Direction. Bell Nettle Gordon Edelman To implement the Statistics Direction, the Australian Statistician proposed to post, or otherwise provide or make available, to all electors as defined in the Statistics Direction a questionnaire seeking their views on the question "Should the law be changed to allow same-sex couples to marry?" and asking for responses to that questionnaire. To do so, it was necessary for the Australian Statistician to seek the assistance of other Commonwealth Departments and agencies and to retain the services of private sector entities. For that purpose, the ABS entered into arrangements which included an arrangement with the AEC for officers and employees of the AEC to assist the ABS in the implementation of the Statistics Direction, but with the Australian Statistician retaining control over that implementation. In entering into that arrangement, the ABS relied on s 16A of the ABS Act and the AEC relied on s 7A of the Electoral Act. Section 16A of the ABS Act relevantly provides that the Australian Statistician may arrange with a governmental agency or authority for the services of officers or employees of the agency or authority to be made available to assist in the carrying out of the functions of the Australian Statistician. Section 7A(1) of the Electoral Act relevantly provides that, subject to presently immaterial limitations, the AEC "may make arrangements for the supply of goods or services to any person or body". Section 7(1)(a) of the Electoral Act provides that, subject again to presently immaterial limitations, the "functions" of the AEC include "to perform functions that are permitted or required to be performed by or under [that] Act". Proceedings The first of the two proceedings commenced on 10 August 2017 ("the Wilkie proceeding") was commenced by an application for an order to show cause which was subsequently amended. There were three plaintiffs in the Wilkie proceeding. The first was Mr Andrew Wilkie, who is an independent Member of the House of Representatives and who voted against the 2016 Bill. The second was Ms Felicity Marlowe, who is an elector, who lives with her female partner of 17 years and their three young children, and who is a long term advocate for rainbow families (families in which one or more parent or carer is a lesbian, gay, bisexual, transgender, intersex or queer person). The third was PFLAG Brisbane Inc, an association incorporated under the Associations Incorporation Act 1981 (Q), which is comprised of individuals who are parents Bell Nettle Gordon Edelman and friends of gay and lesbian people, which includes amongst its objects "to support the full human rights and civil rights of people who are lesbian and gay and their families" and which in practice advocates on issues of human rights and equality in law for gay and lesbian people. The defendants in the Wilkie proceeding were the Commonwealth of Australia, the Finance Minister, the Treasurer, the Australian Statistician and the Electoral Commissioner. By their amended application for an order to show cause, the plaintiffs in the Wilkie proceeding sought declarations and injunctions directed to each defendant. They also sought writs of prohibition directed to the Australian Statistician, prohibiting him from expending the amount in the Finance Determination and from carrying out the Statistics Direction, and directed to the Electoral Commissioner, prohibiting him from providing goods or services to the Australian Statistician in respect of the Statistics Direction. The grounds on which the plaintiffs in the Wilkie proceeding sought that relief were: that s 10 of Appropriation Act No 1 2017-2018 is invalid, or alternatively that the Finance Determination was not authorised by that section; that the Statistics Direction was not authorised by s 9(1)(b) of the Statistics Act; and that the AEC was not authorised by s 7A of the Electoral Act to assist the ABS in the implementation of the Statistics Direction. A further ground to the effect that s 9(1)(b) of the Statistics Act exceeded the legislative power of Parliament under s 51(xi) of the Constitution if and to the extent that s 9(1)(b) authorised the Statistics Direction was raised in the amended application but was not pressed at the hearing. The second of the two proceedings commenced on 10 August 2017 ("the AME proceeding") was commenced by writ of summons accompanied by a statement of claim. There were two plaintiffs in the AME proceeding. The first was Australian Marriage Equality Ltd, which is a company limited by guarantee and a charity registered under the Australian Charities and Not-for-profits Commission Act 2012 (Cth), and which since its formation in 2004 has been advocating for legalisation of marriage between consenting adults irrespective of gender. The second was Senator Janet Rice, who is a Senator for the State of Victoria and a member of the Australian Greens and who is co- convenor of the Parliamentary Friendship Group for LGBTIQ Australians and the Greens spokesperson for LGBTIQ issues. the Bell Nettle Gordon Edelman The defendants in the AME proceeding were the Finance Minister and the Australian Statistician. The Attorney-General of the Commonwealth intervened under s 78A of the Judiciary Act 1903 (Cth). By their writ of summons, the plaintiffs in the AME proceeding sought declarations and injunctions directed to both defendants. The sole ground on which they sought that relief was that the Finance Determination was not authorised by s 10 of Appropriation Act No 1 2017-2018. The arguments on which they relied in support of that ground overlapped with, and in some respects went beyond, the arguments of the plaintiffs in the Wilkie proceeding. On 17 August 2017, Kiefel CJ ordered that the amended application for an order to show cause in the Wilkie proceeding be referred for consideration by the Full Court. Four days later, her Honour ordered by consent that a special case filed by the plaintiffs and the Finance Minister in the AME proceeding also be referred to the Full Court for hearing. The questions of law which the plaintiffs and the Finance Minister by the special case agreed in stating for the opinion of the Full Court, in the form to which they were amended and answered by the Full Court on 7 September 2017, are set out at the conclusion of these reasons. Standing Stated as the first question for the opinion of the Full Court in the special case in the AME proceeding and strongly contested by the defendants in the course of the hearing of both the Wilkie proceeding and the AME proceeding was the standing of the plaintiffs or any of them to seek all or any of the relief they claimed. The contest as to standing gave rise to a number of significant issues. Not least of them was the nature and scope of the constitutional writ of prohibition36, the sufficiency of the interest of a Senator or Member of the House of Representatives in the performance of his or her parliamentary responsibilities to seek declaratory and injunctive relief to prevent an alleged contravention by the Government of s 83 of the Constitution37, and the relevance to standing to 36 Cf R v Wright; Ex parte Waterside Workers' Federation of Australia (1955) 93 CLR 528 at 541-542; [1955] HCA 35; Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82 at 101-104 [43]-[45], 140-142 [162]-[166]; [2000] HCA 57. 37 Cf Combet v The Commonwealth (2005) 224 CLR 494 at 556-557 [97], 620 [308]- [309]; [2005] HCA 61. Bell Nettle Gordon Edelman seek the relief claimed of conceptions of public interest38. No doubt because of the speed with which the proceedings came to be heard, none of those issues was adequately explored in argument. Notwithstanding statements which have linked the need for standing to the need for a "matter" founding jurisdiction39, the High Court has not in practice insisted on determining standing always as a threshold issue but has treated itself as having discretion in an appropriate case to proceed immediately to an examination of the merits40. A notable instance of that occurring in a context not dissimilar to the present was Combet v The Commonwealth41. There the Full Court, by majority, answered a question reserved for its opinion to the effect that the plaintiffs had not established a basis for any of the relief they sought, whilst stating that it was unnecessary to answer a preceding question reserved which asked whether the plaintiffs or either of them had standing to seek that relief42. No argument was put that the approach taken by the majority in Combet was wrong or was unavailable to be taken in the Wilkie proceeding or the AME proceeding. The merits of the grounds relied on by the plaintiffs in the Wilkie proceeding and the AME proceeding having been fully argued and the Court having unanimously those grounds were demonstrably without substance, it was similarly unnecessary to determine whether the plaintiffs in those proceedings or any of them had standing in order the conclusion reached that 38 Cf Bateman's Bay Local Aboriginal Land Council v Aboriginal Community Benefit Fund Pty Ltd (1998) 194 CLR 247 at 267 [50]; [1998] HCA 49. 39 Eg Croome v Tasmania (1997) 191 CLR 119 at 126-127; [1997] HCA 5; Pape v Federal Commissioner of Taxation (2009) 238 CLR 1 at 35 [50]-[51], 68 [152], 98- 99 [271]-[273]; [2009] HCA 23. 40 See Robinson v Western Australian Museum (1977) 138 CLR 283 at 302-303; [1977] HCA 46; Onus v Alcoa of Australia Ltd (1981) 149 CLR 27 at 38; [1981] HCA 50. 41 (2005) 224 CLR 494. 42 (2005) 224 CLR 494 at 625-626, questions (1) and (3). See (2005) 224 CLR 494 at Bell Nettle Gordon Edelman to reject their claims for relief. Indeed, the inadequacy of the argument on standing made it inappropriate in the circumstances to address standing. Leaving standing therefore entirely to one side, and moving directly to the merits of the grounds relied upon by the plaintiffs in each proceeding, it is most efficient to isolate and address the various strands of the plaintiffs' arguments in the course of considering in turn: the validity of s 10 of Appropriation Act No 1 2017-2018, the construction of that section, the validity of the Finance Determination, the validity of the Statistics Direction, and the authority of the AEC to assist the ABS in the implementation of the Statistics Direction. The validity of s 10 of Appropriation Act No 1 2017-2018 Section 81 of the Constitution provides that "[a]ll revenues or moneys raised or received by the Executive Government of the Commonwealth shall form one Consolidated Revenue Fund, to be appropriated for the purposes of the Commonwealth in the manner and subject to the charges and liabilities imposed by this Constitution". Section 83 provides that "[n]o money shall be drawn from the Treasury of the Commonwealth except under appropriation made by law". Sections 81 and 83 together give expression to the foundational principle of representative and responsible government "that no money can be taken out of the consolidated Fund into which the revenues of the State have been paid, excepting under a distinct authorization from Parliament itself"43. The sections also prescribe the form of the requisite parliamentary authorisation: it must be by "law". They thereby combine to exclude from the scheme of the Constitution "the once popular doctrine that money might become legally available for the service of Government upon the mere votes of supply by the Lower House"44. 43 Brown v West (1990) 169 CLR 195 at 205, 208; [1990] HCA 7, quoting Auckland Harbour Board v The King [1924] AC 318 at 326. See also The Commonwealth v Colonial Combing, Spinning and Weaving Co Ltd (1922) 31 CLR 421 at 449; [1922] HCA 62; The Commonwealth v Colonial Ammunition Co Ltd (1924) 34 CLR 198 at 224; [1924] HCA 5. 44 Harrison Moore, The Constitution of the Commonwealth of Australia, 2nd ed Bell Nettle Gordon Edelman Sections 53, 54 and 56 of the Constitution speak in that context to the manner of enactment of a proposed law for the appropriation of revenue or moneys. Section 56 provides that a proposed law for the appropriation of revenue or moneys "shall not be passed unless the purpose of the appropriation has in the same session been recommended by message of the Governor-General to the House in which the proposal originated". Section 53 relevantly provides that a proposed law appropriating revenue or moneys "shall not originate in the Senate" and that the Senate may not amend "proposed laws appropriating revenue or moneys for the ordinary annual services of the Government". Section 54 speaks to the potential for the House of Representatives to take advantage of s 53's limitation on the Senate's power to amend by providing that "[t]he proposed law which appropriates revenue or moneys for the ordinary annual services of the Government shall deal only with such appropriation". Each of ss 53, 54 and 56 of the Constitution is a "procedural provision governing the intra-mural activities of the Parliament" in respect of which "this Court does not interfere". A failure to comply with any one or more of them "is not contemporaneously justiciable and does not give rise to invalidity of the resulting Act when it has been passed by the two Houses of the Parliament and has received the royal assent"45. The procedure set out in ss 53, 54 and 56 for the enactment of a proposed law for the appropriation of revenue or moneys is nevertheless relevant, and important, to understanding the practice of Parliament which provides context for the construction of Appropriation Act No 1 2017-2018. Appropriations by law are in practice either "special appropriations" (one category of special appropriations being "standing appropriations") or "annual appropriations" (pertaining to a fiscal year which runs from 1 July to 30 June)46. 45 Northern Suburbs General Cemetery Reserve Trust v The Commonwealth (1993) 176 CLR 555 at 578; [1993] HCA 12; Western Australia v The Commonwealth (Native Title Act Case) (1995) 183 CLR 373 at 482; [1995] HCA 47; Permanent Trustee Australia Ltd v Commissioner of State Revenue (Vict) (2004) 220 CLR 388 at 409 [41]; [2004] HCA 53; Combet v The Commonwealth (2005) 224 CLR 494 at 46 Wright (ed), House of Representatives Practice, 6th ed (2012) at 423, 428. Bell Nettle Gordon Edelman Since 1901, Bills for annual appropriations have in practice been introduced by the Treasurer in the House of Representatives, preceded by a message from the Governor-General, in two principal sets: Appropriation Bills Nos 1 and 2 (which, together now with an Appropriation (Parliamentary Departments) Bill (No 1) and accompanying statements, are typically referred to as the "budget") and Appropriation Bills Nos 3 and 4 (which, together now with an Appropriation (Parliamentary Departments) Bill (No 2), are typically referred to as "additional estimates")47. Drawing distinctions important for the purposes of ss 53 and 54 of the Constitution, each of Appropriation Bills Nos 1 and 3 was until 1999 typically designated in its long title as a Bill for an Act to appropriate money out of the Consolidated Revenue Fund "for the service of the year ending on 30 June", whereas each of Appropriation Bills Nos 2 and 4 was typically designated in its long title as a Bill for an Act to appropriate money out of the Consolidated Revenue Fund "for certain expenditure". Since 2000, whilst the long titles of Appropriation Bills Nos 2 and 4 have remained the same, the long titles of Appropriation Bills Nos 1 and 3 have explicitly adopted the language of ss 53 and 54 of the Constitution in describing each of them as a Bill for an Act to appropriate money out of the Consolidated Revenue Fund "for the ordinary annual services of the Government". Since 1994, Appropriation Bills Nos 1 and 2 have been introduced in May48, eliminating the need for the earlier practice of interim appropriations for the fiscal year commencing 1 July being made through the introduction and enactment of Supply Bills49. Appropriation Bills Nos 3 and 4 are now generally introduced between October and February50. Additional pairs of Appropriation Bills, in the form of Appropriation Bills Nos 5 and 6, have sometimes been 47 Wright (ed), House of Representatives Practice, 6th ed (2012) at 428-430. 48 Wright (ed), House of Representatives Practice, 6th ed (2012) at 428 fn 58. 49 Wright (ed), House of Representatives Practice, 6th ed (2012) at 437. 50 Wright (ed), House of Representatives Practice, 6th ed (2012) at 428 fn 60. Bell Nettle Gordon Edelman introduced after the enactment of Appropriation Bills Nos 3 and 4 during the same fiscal year but such additional Appropriation Bills are less common51. Other Appropriation Bills have sometimes been introduced within a fiscal year outside the normal sequence of paired Bills for annual appropriations52. The parties have pointed to 16 occasions since 2000 on which Parliament enacted Appropriation Acts which appropriated specific amounts of money for expenditure by Commonwealth entities in addition to amounts appropriated in ordinary annual Appropriation Acts. Some of those Appropriation Acts were designated by their long titles as Acts to appropriate money, or additional money, out of the Consolidated Revenue Fund "for the ordinary annual services of the Government"53; some were not54. Whether a particular appropriation can be characterised as special or annual, and whether or not an annual appropriation is for the ordinary annual services of the Government, that appropriation can only be for a purpose which Parliament has determined. The need for such a determination of purpose is reflected in the language of ss 56 and 81 of the Constitution and is inherent in the nature of an appropriation55: "'Appropriation of money to a Commonwealth purpose' means legally segregating it from the general mass of the Consolidated Fund and dedicating it to the execution of some purpose which either the 51 Wright (ed), House of Representatives Practice, 6th ed (2012) at 436. 52 Wright (ed), House of Representatives Practice, 6th ed (2012) at 436. 53 Eg Appropriation (Cth); Appropriation (Drought and Equine Influenza Assistance) Act (No 1) 2007-2008 (Cth). (Tsunami Financial Assistance) Act 2004-2005 54 Eg Appropriation (Economic Security Strategy) Act (No 2) 2008-2009 (Cth); Appropriation (Water Entitlements) Act 2009-2010 (Cth). 55 Brown v West (1990) 169 CLR 195 at 208 (emphasis added), quoting The State of New South Wales v The Commonwealth (1908) 7 CLR 179 at 200; [1908] HCA 68. See also Pape v Federal Commissioner of Taxation (2009) 238 CLR 1 at 44 [79], Bell Nettle Gordon Edelman Constitution has itself declared, or Parliament has lawfully determined, shall be carried out." Together with the prohibition in s 83 of the Constitution, the requirement for an appropriation to be for a legislatively determined purpose results in an appropriation serving a dual function56: "Not only does it authorize the Crown to withdraw moneys from the Treasury, it 'restrict(s) the expenditure to the particular purpose', as Isaacs and Rich JJ observed in The Commonwealth v Colonial Ammunition Co Ltd." "[T]here cannot be appropriations in blank, appropriations for no designated purpose, merely authorizing expenditure with no reference to purpose"57, just as "[t]here can be no appropriation in gross, authorizing the withdrawal of whatever sum the Executive Government may decide in the exercise of an unfettered discretion"58. An appropriation must always be for a purpose identified by the Parliament, albeit that "[i]t is for the Parliament to identify the degree of specificity with which the purpose of an appropriation is The plaintiffs in the Wilkie proceeding argued that, in enacting s 10 of Appropriation Act No 1 2017-2018, Parliament transgressed that constitutional limitation, abdicated its legislative responsibility and impermissibly delegated its power of appropriation to the Finance Minister. To appreciate how the argument was put, regard must be had to the history of inclusion within Appropriation Acts No 1 of Advances to the Finance Minister and, before then, of Advances to the Treasurer. 56 Brown v West (1990) 169 CLR 195 at 208, quoting Victoria v The Commonwealth and Hayden (1975) 134 CLR 338 at 392; [1975] HCA 52 (footnote omitted). 57 Brown v West (1990) 169 CLR 195 at 208, quoting Attorney-General (Vict) v The Commonwealth (1945) 71 CLR 237 at 253; [1945] HCA 30. 58 Northern Suburbs General Cemetery Reserve Trust v The Commonwealth (1993) 176 CLR 555 at 582. 59 Combet v The Commonwealth (2005) 224 CLR 494 at 577 [160]. Bell Nettle Gordon Edelman The history starts with the first Act ever enacted by Parliament. Its long title was "[a]n Act to grant and apply out of the Consolidated Revenue Fund [a specified total amount of money] to the service of the period ending [30 June 1901]". Section 1 authorised that specified total amount of money to be "issued and applied" out of the Consolidated Revenue Fund "for the purposes and services expressed in the Schedule to this Act". The Schedule then broke down the specified total into designated "heads" of expenditure arranged by Ministerial portfolio. The last of those heads of expenditure, representing approximately 2 per cent of the specified total, was designated "Advance to Treasurer" and was explained in the Schedule as being "[t]o enable the Treasurer to make Advances to Public Officers, and to Pay Expenses of an unforeseen nature, which will afterwards be submitted for Parliamentary Appropriation". That Act set the pattern of including within the total amount appropriated by each annual Appropriation Act a specific amount designated as the Advance to the Treasurer. The pattern was followed in subsequent years. In 1906, the Audit Act 1901 (Cth) ("the Audit Act") was amended to include s 36A60, which provided: "Expenditure in excess of specific appropriation or not specifically provided for by appropriation may be charged to such heads as the Treasurer may direct provided that the total expenditure so charged in any financial year, after deduction of amounts of repayments and transfers to heads for which specific appropriation exists, shall not exceed the amount appropriated for that year under the head 'Advance to the Treasurer.'" Section 36A was accurately described at the time of its introduction as a "bookkeeping matter"61. The section provided no authority for the Treasurer to withdraw unappropriated money from the Consolidated Revenue Fund. What it did was to permit the Treasurer to authorise the debiting, to other heads of expenditure, of amounts issued from the Consolidated Revenue Fund under the authority of the Advance to the Treasurer for which provision was routinely made in each annual Appropriation Act. 60 Section 8 of the Audit Act 1906 (Cth). 61 Australia, House of Representatives, Parliamentary Debates (Hansard), 31 July Bell Nettle Gordon Edelman Except that s 36A of the Audit Act was amended in 1961 to add "at any time" before "exceed"62 and in 1979 to replace "Advance to the Treasurer" with "Advance to the Minister for Finance"63 (following the establishment in 1976 of the office of the Finance Minister and with it the creation of the Department of Finance), the section remained substantively in its original form until the repeal of the Audit Act. The repeal of the Audit Act occurred on the commencement of the Financial Management and Accountability Act 1997 (Cth)64, as part of the transition to full accrual accounting which was introduced with the budget which led the enactment of Appropriation Act (No 1) 1999-2000 (Cth) ("Appropriation Act No 1 1999-2000"). From 1901, and throughout the period in which s 36A of the Audit Act was in force, the practice was for amounts issued from the Consolidated Revenue Fund under the authority of the Advance to the Treasurer contained in an Appropriation Act No 1 ordinarily to be recouped in the same fiscal year in an Appropriation Act No 365. include Until 1957, the practice was in what were called "supplementary estimates" amounts issued from the Consolidated Revenue Fund under the authority of the Advance to the Treasurer which had not been so recouped. The supplementary estimates were then enacted as a further appropriation in the next fiscal year. Supplementary estimates were abandoned in 1957, when they were replaced by a requirement for particulars of amounts remaining a charge to the Advance to the Finance Minister to be tabled in the Parliament, where they were available to be examined by the Joint Committee of 62 Section 9 of the Audit Act 1961 (Cth). 63 Audit Amendment Act 1979 (Cth). 64 Audit (Transitional and Miscellaneous) Amendment Act 1997 (Cth). 65 Australia, Senate Standing Committee on Finance and Government Operations, Advance to the Minister for Finance, Parliamentary Paper No 217/1979, (1979) at Bell Nettle Gordon Edelman Public Accounts established under the Public Accounts Committee Act 1951 By 1979, the Advance to the Finance Minister had accordingly come routinely to be expressed in the relevant Schedule to an Appropriation Act No 1 as being, relevantly, to enable the Finance Minister "to make advances that will be recovered during the financial year, in respect of expenditure that is expenditure for the ordinary annual services of the Government; and ... to make moneys available for expenditure, being expenditure for the ordinary annual services of the Government ... particulars of which will afterwards be submitted to the Parliament"67. The manner in which the Advance to the Finance Minister was expressed in the relevant Schedule to an Appropriation Act No 1 changed in 1981 following the partial adoption in that year by the Government of recommendations made in a report of the Senate Standing Committee on Finance and Government Operations in 197968. To the extent that it is now relevant, the standard expression thereafter became69: "To enable the Minister for Finance: to make advances that will be recovered during the financial year, in respect of expenditure that is expenditure for the ordinary annual services of the Government; [and] to make money available for expenditure: that the Minister for Finance is satisfied is expenditure that: 66 Australia, Parliament, Joint Committee of Public Accounts, Advance to the Minister for Finance, Report No 289, (1988) at 3 [1.11]-[1.12]. 67 Appropriation Act (No 1) 1978-79 (Cth). 68 Australia, Senate Standing Committee on Finance and Government Operations, Advance to the Minister for Finance, Parliamentary Paper No 217/1979, (1979) at 69 Eg Sched 3 to the Appropriation Act (No 1) 1987-88 (Cth). Bell Nettle Gordon Edelman is urgently required; and (B) was unforeseen until after the last day on which it was practicable to include appropriation for that expenditure in the Bill for this Act before the introduction of the House of Representatives; and that Bill into particulars of which will afterwards be submitted to the Parliament; being expenditure for Government; ..." the ordinary annual services of the With the enactment of Appropriation Act No 1 1999-2000, an Appropriation Act No 1 first took substantially the form now seen in Appropriation Act No 1 2017-2018. What had been "heads" of expenditure in a Schedule to previous Appropriation Acts No 1 were replaced by "items" in a Schedule to Appropriation Act No 1 1999-2000; the total of the items specified in the Schedule was stated in the body of the Act; the Advance to the Finance Minister was taken out of the Schedule and placed in the body of the Act; and the body of the Act concluded with a section which simply stated that "[t]he Consolidated Revenue Fund is appropriated as necessary for the purposes of this Act". In Appropriation Act (No 1) 2000-2001 (Cth), the section which dealt with the Advance to the Finance Minister came to be expressed as follows70: "(1) This section applies if the Finance Minister is satisfied that: there is an urgent need for expenditure that is not provided for, or is insufficiently provided for, in the Schedule; and the additional expenditure is not provided for, or is insufficiently provided for, in the Schedule: 70 Section 11 of the Appropriation Act (No 1) 2000-2001 (Cth). Bell Nettle Gordon Edelman because of an erroneous omission or understatement; because the additional expenditure was unforeseen until after the last day on which it was practicable to provide for it in the Bill for this Act before that Bill was introduced into the House of Representatives. This Act has effect as if the Schedule were amended, in accordance with a determination of the Finance Minister, to make provision for so much (if any) of the additional expenditure as the Finance Minister determines. The total of the amounts determined under this section cannot be more than $175 million. The Finance Minister must give the Parliament details of amounts determined under this section." The section dealing with the Advance to the Finance Minister was thereafter expressed in substantially identical terms in each subsequent Appropriation Act No 1 up to and including Appropriation Act (No 1) 2007-2008 (Cth), except for an alteration to sub-s (4) in and after Appropriation Act (No 1) 2005-2006 (Cth) consequential on the commencement of the Legislation Act (then known as the Legislative Instruments Act 2003 (Cth)). With the enactment of Appropriation Act (No 1) 2008-2009 (Cth) ("Appropriation Act No 1 2008-2009"), the section dealing with the Advance to the Finance Minister took the form now seen in Appropriation Act No 1 2017-2018. Since 2008, nothing material has changed from year to year. Even the particular amount that has been specified in sub-s (3) has remained constant at $295 million. The plaintiffs in the Wilkie proceeding emphasised that their argument did not call into question the validity of the Advance to the Treasurer in the form in which it was enacted in 1901. At its most extreme, as advanced orally in reply, their argument did appear to call into question the validity of the Advance to the Treasurer and the Advance to the Finance Minister to the extent to which they were relied on after 1957 to support drawings from the Consolidated Revenue Fund which were not recouped by a further appropriation. At its core, however, Bell Nettle Gordon Edelman their argument was directed to establishing the invalidity of s 10 of Appropriation Act No 1 2017-2018 by reference to features which have been constant in sections which dealt with the Advance to the Finance Minister in each Appropriation Act No 1 since Appropriation Act No 1 1999-2000. The argument was that s 10 of Appropriation Act No 1 2017-2018 purported to confer power on the Finance Minister to alter Appropriation Act No 1 2017-2018 so as to supplement "by executive fiat" the amount appropriated by Parliament in Sched 1. The argument was based on a fundamental misconstruction. The provision of Appropriation Act No 1 2017-2018 which appropriates the Consolidated Revenue Fund is s 12. "Significantly", to adopt the description of its operation given in the explanatory memorandum to Appropriation Act No 1 2017-2018, that section "means that there is an appropriation in law when the Act commences. That is, the appropriations are not made or brought into existence just before they are paid, but when the Act commences."71 Section 12 operated on and from the commencement of Appropriation Act No 1 2017-2018 as an immediate appropriation of money from the Consolidated Revenue Fund for the totality of the purposes of the Act. Section 12 so operated as an immediate appropriation of the amount of $295 million specified in s 10(3) in the same way as it operated as an immediate appropriation of the amount of $88,751,598,000 noted in s 6 to be the total of the items specified in Sched 1. The appropriation constituted authorisation, subject to the restrictions imposed by the Act, for the withdrawal from the Consolidated Revenue Fund of the whole or any part of each of those amounts to be applied for the purposes identified in Appropriation Act No 1 2017-2018. The power of the Finance Minister to make a determination under s 10(2) of Appropriation Act No 1 2017-2018 is not a power to supplement the total amount that has otherwise been appropriated by Parliament. The power is rather a power to allocate the whole or some part of the amount of $295 million that is already appropriated by s 12 operating on s 10(3). 71 Australia, House of Representatives, Appropriation Bill (No 1) 2017-2018, Explanatory Memorandum at 9 [33]. Bell Nettle Gordon Edelman Nor is the power of the Finance Minister to make a determination under s 10(2) of Appropriation Act No 1 2017-2018 at large if the precondition to the exercise of that power set out in s 10(1) is met. The legislative fiction that the Act "has effect as if Schedule 1 were amended" in accordance with a determination under s 10(2) has the limiting effect that the power conferred by s 10(2) can only be exercised through the Finance Minister determining to allocate the whole or some part of the amount of $295 million to a specified "item" in respect of a specified "entity" in a manner in which another section of the Act can then pick up on those specifications to authorise the allocated amount to be applied. Section 10(2) of Appropriation Act No 1 2017-2018 is in that respect not dissimilar in its operation to s 36A of the Audit Act. Passing scepticism has from time to time been expressed academically72, in the Senate73 and in this Court74 as to how the Advance to the Finance Minister or the Treasurer in the form in which it existed in the century before enactment of Appropriation Act No 1 1999-2000 could be reconciled with the constitutional requirement for an appropriation to be for a legislatively determined purpose. The reconciliation lies in recalling that the degree of specificity of the purpose of an appropriation is for Parliament to determine. The constitutional requirement for Parliament to determine the purpose of an appropriation cannot be so constraining of legislative options as to ignore "practical necessity"75. The Joint Committee of Public Accounts observed in a report on the Advance to the Finance Minister published in 1988 that the 72 Campbell, "Parliamentary Appropriations", (1971) 4 Adelaide Law Review 145 at 73 Australia, Senate Standing Committee on Finance and Government Operations, Advance to the Minister for Finance, Parliamentary Paper No 217/1979, (1979) at 74 Northern Suburbs General Cemetery Reserve Trust v The Commonwealth (1993) 176 CLR 555 at 600-601. 75 Victoria v The Commonwealth and Hayden (1975) 134 CLR 338 at 394. Bell Nettle Gordon Edelman Advance is "necessary for the smooth running of the Government"76. The Joint Committee went on to explain77: "In the normal course of events detailed specific appropriations for expenditure are passed by the Parliament in the Appropriation Acts prior to actual expenditure. However, there will always be cases where, due to various reasons particularly in urgent and unforeseen circumstances, moneys will be required for expenditure before the next Appropriation Bills are passed by the Parliament." The restrictions legislatively imposed on the application of the Advance to the Finance Minister have been no less stringent in the nearly two decades since the enactment of Appropriation Act No 1 1999-2000 than they were in the century before. Neither in this century nor the last has the standard legislative provision for the Advance to the Finance Minister contravened the constitutional requirement that an appropriation be for a legislatively determined purpose. To appropriate by s 12 of Appropriation Act No 1 2017-2018 the amount specified in s 10(3) to be applied, relevantly under s 7, in accordance with a direction under s 10(2) if the precondition in s 10(1) is met is to appropriate that amount for a purpose which Parliament has lawfully determined may be carried out. The constitutional challenge of the plaintiffs in the Wilkie proceeding, for those reasons, failed. The construction of s 10 of Appropriation Act No 1 2017-2018 The plaintiffs' arguments concerning the Finance Determination were primarily directed to establishing that the precondition set out in s 10(1) of Appropriation Act No 1 2017-2018 to the exercise of the power of the Finance Minister to make a determination under s 10(2) was not met. Before addressing factual aspects of those arguments, it is convenient to isolate the validity of 76 Australia, Parliament, Joint Committee of Public Accounts, Advance to the Minister for Finance, Report No 289, (1988) at v. 77 Australia, Parliament, Joint Committee of Public Accounts, Advance to the Minister for Finance, Report No 289, (1988) at 1 [1.2]. Bell Nettle Gordon Edelman and address as a discrete topic those aspects of the arguments which bore on the construction of s 10(1). Section 10(1), in its relevant operation, makes it a precondition to the application of the remainder of s 10 that "the Finance Minister is satisfied that there is an urgent need for expenditure, in the current year, that is not provided for, or is insufficiently provided for, in Schedule 1 … because the expenditure was unforeseen until after the last day on which it was practicable to provide for it in the Bill for this Act before that Bill was introduced into the House of Representatives". The casting of that precondition by reference to the Finance Minister's "satisfaction" invokes an "established drafting technique" which has for more than a century been "used to make the holding of a particular state of mind by the repository a precondition to the performance of a duty or to the exercise of a power"78. The particular use of that drafting technique to express the precondition to the application of the Advance to the Finance Minister is of long standing and has been the subject of careful deliberation. The decision to adopt that drafting technique to express the precondition to the application of the Advance to the Finance Minister was first taken by the Government in 1981 as a considered response to one of the recommendations which had been made in 1979 in the report of the Senate Standing Committee on Finance and Government Operations to which reference has earlier been made. The Standing Committee recommended that criteria to the effect that expenditure from the Advance to the Finance Minister "be permitted only in 'urgent and unforeseen' circumstances" should be set out in regulations made under the Audit Act79. The Government response, announced in the Senate, was to reject the 78 Plaintiff M96A/2016 v The Commonwealth (2017) 91 ALJR 579 at 588 [39]; 343 ALR 362 at 372; [2017] HCA 16, citing Re Minister for Immigration and Multicultural Affairs; Ex parte Applicant S20/2002 (2003) 77 ALJR 1165; 198 ALR 59; [2003] HCA 30 and Bankstown Municipal Council v Fripp (1919) 26 CLR 385; [1919] HCA 41. 79 Australia, Senate Standing Committee on Finance and Government Operations, Advance to the Minister for Finance, Parliamentary Paper No 217/1979, (1979) Bell Nettle Gordon Edelman recommendation on the basis of "legal advising to the effect that practical legal difficulties would arise in dealing with requests for the issue of funds from the Advance if the words 'urgent and unforeseen' were to be included in legislation". In recognition of the Standing Committee's concern "to see some form of legislative provision constraining the use of the Advances", however, the Government indicated its preparedness, which had already been put into effect in Appropriation Act (No 1) 1980-81 (Cth), to include in the relevant Schedule to an Appropriation Act "a clause which provides for the Minister for Finance to be satisfied that expenditure from the [Advance] is urgent and unforeseen"80. Informing the Government's response in 1981 was advice from the Attorney-General's Department in the form of a letter from the Secretary of the Attorney-General's Department to the Secretary of the Department of Finance dated 11 December 1979, a copy of which was included within the material adduced by the parties at the hearing of the proceedings. The author of that advice was Mr Dennis Rose. The practical legal difficulties which had the potential to occur if the Standing Committee's recommendation were accepted were spelt out by Mr Rose as follows: "A restriction in these terms would mean that expenditure from an Advance could legally be made only if the correct legal conclusion, given all the circumstances, was that the circumstances were 'urgent and unforeseen'. Contrary to the Committee's suggestion ..., the question would not simply be one of 'fact'. It would be necessary to decide in each case, on the basis of all the facts, whether the legal criteria of 'urgent and unforeseen circumstances' were met. That involves a matter of judgment, not simply a question of 'fact'. Legal advice would need to be sought from the Attorney-General's Department wherever the Department of Finance was in doubt. The Attorney-General's Department would need to examine all the circumstances of the proposed expenditure and express its opinion. The Auditor-General would be obliged to examine the matter as a question of the legality of the expenditure. There would still be no absolute assurance that, if the matter were tested in a court, the court would reach the same conclusion. If the matter were in issue in a court, evidentiary questions could arise – eg in relation to Crown privilege on matters relevant to the questions whether the circumstances were 'urgent 80 Australia, Senate, Parliamentary Debates (Hansard), 26 May 1981 at 2067. Bell Nettle Gordon Edelman and unforeseen'. Moneys incorrectly paid out pursuant to an erroneous decision would be recoverable from the payees subject only to certain limited qualifications (Auckland Harbour Board v The King [1924] AC Mr Rose added, the emphasis being his: "It would be possible to avoid the difficulties outlined above, and at the same time to provide some legislative endorsement of the Committee's desire to limit the Advances to 'urgent and unforeseen' expenditure. One possible means of doing this would be to express the Advances as appropriating moneys for expenditure in the various categories only where the Minister for Finance was 'satisfied' that the expenditure was 'urgent and unforeseen'." The nature of the constraint imposed by the legislative requirement in the relevant Schedule to an Appropriation Act for the Finance Minister to be "satisfied" that expenditure was "urgent and unforeseen" was the subject of further written advice from the Attorney-General's Department to the Joint Committee of Public Accounts in 1988. Noting that a requirement that the Finance Minister be "satisfied" that expenditure was "urgent and unforeseen" had been routinely incorporated into the relevant Schedules of Appropriation Acts from 1980, the Joint Committee asked81: "Is the interpretation of what is 'urgent and unforeseen' a subjective one ie as long as the Minister for Finance (or his delegate) is satisfied that the expenditure was urgent and unforeseen and certifies as such, then it meets all legal requirements?" The answer then given, in advice jointly authored by Mr Peter Clay and 81 Australia, Parliament, Joint Committee of Public Accounts, Advance to the Minister for Finance, Report No 289, (1988) at 26. 82 Australia, Parliament, Joint Committee of Public Accounts, Advance to the Minister for Finance, Report No 289, (1988) at 36. Bell Nettle Gordon Edelman "The relevant provision commits to the Minister, and to no one else, the power to form an opinion that particular expenditure meets the requirements ... It is a power expressed in subjective terms. However, the Minister is not free to form any opinion he pleases. His opinion must be not unreasonable and it must be formed having regard to relevant considerations – including the correct legal meaning of the expressions 'urgently required' and 'unforeseen' and for permissible purposes." That further advice – clearly expressed and clearly correct – was published as an appendix to the report of the Joint Committee of Public Accounts on the Advance to the Minister for Finance in 1988. The advice can be taken to have informed the consistent legislative usage since 1988 of the terminology first legislatively adopted in 1980 on the basis of Mr Rose's advice. for the that requirement Acknowledging the Finance Minister's satisfaction had been applicable to expenditure being both "urgent" and "unforeseen" in the expression of the Advance to the Finance Minister in the relevant Schedules to Appropriation Acts from 1980, and had continued to be applicable to the expression of the Advance to the Finance Minister in the bodies of Appropriation Acts from 1999, the plaintiffs in the AME proceeding argued that there was significance in the change in expression which occurred with the enactment of Appropriation Act No 1 2008-2009, the language of which has been replicated in each subsequent Appropriation Act No 1. They argued that the change had the effect of taking the question of whether expenditure was "unforeseen" outside the scope of the Minister's satisfaction so as to make it an objective question for determination by a court. That suggested departure from the previously established legislated position would have been a radical one. The inference of such a departure is not compelled by the statutory text. The opening reference in s 10(1) of Appropriation Act No 1 2017-2018 to the Finance Minister being "satisfied" is naturally read as governing each subordinate clause which begins with "because". That any departure from the previously established practice was intended the explanatory memorandum for Appropriation Act No 1 2008-2009, which explained the section of that Act which was equivalent to s 10(1) of Appropriation Act No 1 2017-2018 as establishing "the criteria about which the Finance Minister must be satisfied before he or she may determine to add an amount from the [Advance to the in 2008 is contradicted by Bell Nettle Gordon Edelman Finance Minister] to an item of an agency"83. An explanation to the same effect appears the explanatory memorandum for Appropriation Act No 1 The change of expression which occurred with the enactment of Appropriation Act No 1 2008-2009 involved the removal of duplicated verbiage. It was not a change of substance. The change is properly attributable to a change of drafting style and cannot be taken to indicate a change of meaning85. The qualities of the satisfaction required of the Finance Minister in order to meet the precondition set by s 10(1) of Appropriation Act No 1 2017-2018 are informed by a number of statutory indications. One is the statutory requirement that the satisfaction be that of the Finance Minister. Another is the requirement of s 10(4) operating in conjunction with provisions of the Legislation Act that any exercise of the Finance Minister's power of determination under s 10(2) following formation of the requisite state of satisfaction is required to be promptly notified to the Senate and the House of Representatives together with an explanation of purpose. Another is the established practice of the Secretary to the Department of Finance reporting annually to Parliament on advances provided under annual Appropriation Acts in each fiscal year in reports which are reviewed by the Auditor-General. The Finance Minister's satisfaction must be formed reasonably and on a correct understanding of the law86. The Finance Minister must not take into account a consideration which a court can determine in retrospect "to be 83 Australia, House of Representatives, Appropriation Bill (No 1) 2008-2009, Explanatory Memorandum at 15 [54]. 84 Australia, House of Representatives, Appropriation Bill (No 1) 2017-2018, Explanatory Memorandum at 8 [28]. 85 Section 15AC of the Acts Interpretation Act 1901 (Cth). 86 Minister for Immigration and Multicultural Affairs v Eshetu (1999) 197 CLR 611 at 651-654 [130]-[137]; [1999] HCA 21; Graham v Minister for Immigration and Border Protection [2017] HCA 33 at [57]. Bell Nettle Gordon Edelman definitely extraneous to any objects the legislature could have had in view"87. But the Finance Minister is not obliged to act apolitically or quasi-judicially88. What then, on a correct understanding of the law, is the satisfaction which the Finance Minister is required to form in order to meet the precondition to the exercise of power set by s 10(1)? First, the Finance Minister must be satisfied that there is a need for expenditure, in the current fiscal year, that is not provided for, or is insufficiently provided for, in Sched 1 to Appropriation Act No 1 2017-2018. The notion of expenditure is that given by the statutory definition of that term as meaning payments for expenses, acquiring assets, making loans or paying liabilities. The notion of need does not require that the expenditure be critical or imperative. To set the bar that high would tend to render the other considerations of which the Finance Minister must be satisfied contradictory, not complementary. The notion of need must rather be of expenditure which ought to occur, whether for legal or practical or other reasons. The plaintiffs in each proceeding argued in substance that the need must arise from some source external to Government. They pointed, however, to nothing in the context of the section or in the long history of the Advance to the Finance Minister which might warrant importation of that unexpressed limitation. The very nature of expenditure by Government is incompatible with importation of the limitation. Even where expenditure might be responsive to some external circumstance, the incurrence of that expenditure will be the result of an internal decision in which options, consequences and competing priorities will be weighed. Next, the Finance Minister must be satisfied that the need for the expenditure is urgent. Urgency, of course, is a relative concept. The concept here is of urgency in the context of the ordinary sequence of annual Appropriation Acts. The question for the Finance Minister to weigh is why the expenditure that is needed in the current fiscal year and that is not provided for, 87 Water Conservation and Irrigation Commission (NSW) v Browning (1947) 74 CLR 492 at 505; [1947] HCA 21. 88 Cf Minister for Immigration and Multicultural Affairs v Jia Legeng (2001) 205 CLR 507 at 539 [102]; [2001] HCA 17. Bell Nettle Gordon Edelman or is insufficiently provided for, in the relevant Schedule to Appropriation Act No 1 cannot await inclusion in Appropriation Act No 3, or (if the time for inclusion of the expenditure within Appropriation Act No 3 has already passed) why it might not be included in an Appropriation Act No 5. The plaintiffs in each proceeding argued that the Finance Minister is obliged to weigh the additional or alternative question of whether it is reasonable or practicable for the Government to introduce a Bill for a special appropriation into the House of Representatives so as to permit that Bill to be considered by the Senate. Again, however, they were unable to point to any support for that argument in the text or context of the section. The history of the use of the Advance to the Finance Minister, at least since 1957, contradicts it. Were needed expenditure to exceed the amount of the Advance to the Finance Minister, the Government would have no option but to introduce a Bill for a further appropriation outside the ordinary sequence of annual Appropriation Acts. Where needed expenditure does not exceed the amount of the Advance to the Finance Minister, that amount is already immediately available to meet the expenditure provided only that the precondition in s 10(1) is met. That is the reason the amount – specified in s 10(3) – was appropriated in the first place. The plaintiffs in the AME proceeding drew attention to a reference in the explanatory memorandum for Appropriation Act No 1 2008-2009 to the existence of "AFM guidelines" according to which "an urgent need for expenditure [was] expenditure that [was] required within two weeks"89. The reference was to non-statutory guidelines issued by the Department of Finance. Those guidelines were expressed to provide guidance to officers within other Commonwealth entities who may have been considering approaching the Department of Finance to request the Finance Minister to exercise the Finance Minister's power of determination under the equivalent of s 10(2) of Appropriation Act No 1 2017-2018. Their existence did not constrain, and could not have constrained, the Finance Minister in considering the question of urgency under the equivalent of s 10(1) of Appropriation Act No 1 2017-2018. The explanatory memorandum for Appropriation Act No 1 2008-2009 contained no suggestion that they did. 89 Australia, House of Representatives, Appropriation Bill (No 1) 2008-2009, Explanatory Memorandum at 15 [54]. Bell Nettle Gordon Edelman The plaintiffs in the AME proceeding also drew attention to a statement in the explanatory memorandum for Appropriation Act No 1 2017-2018 to the effect that "[g]enerally, options under sections 74 to 75 of the PGPA Act must be considered, where applicable, before the Finance Minister will make a determination under subclause 10(2)"90. The statement is in its terms directed to the exercise of the Finance Minister's discretion under s 10(2) rather than to the formation of the Finance Minister's satisfaction under s 10(1). Moreover, the statement is descriptive, not prescriptive. Section 74 of the PGPA Act provides for an amount received by a non- corporate Commonwealth entity in some circumstances to be credited to a departmental item for that entity in an Appropriation Act. Section 75 of the PGPA Act applies only if a function of a non-corporate Commonwealth entity is transferred those to another non-corporate Commonwealth entity. circumstances, s 75 allows for the Finance Minister to determine that the operation of one or more Schedules to one or more Appropriation Acts is modified in a specified way. As the notes to s 6 of Appropriation Act No 1 2017-2018 indicate, ss 74 and 75 of the PGPA Act operate as additional means of providing for adjustment of amounts appropriated by Appropriation Act No 1 2017-2018. Their existence does not constrain the Finance Minister's satisfaction as to the need for or urgency of expenditure under s 10(1) and the potential for their exercise is not a consideration which the Finance Minister is bound to take into account in the formation of that satisfaction. Finally, the Finance Minister must be satisfied that the additional expenditure in the current fiscal year is not provided for, or is insufficiently provided for, in Sched 1 because the expenditure was unforeseen until after the last day on which it was practicable to provide for it in the Bill for Appropriation Act No 1 2017-2018. The question for the Finance Minister at that final stage of inquiry concerns the expenditure that the Finance Minister is satisfied is needed; that is to say, the actual payments that are to be made. The question is: was that 90 Australia, House of Representatives, Appropriation Bill (No 1) 2017-2018, Explanatory Memorandum at 8 [29]. Bell Nettle Gordon Edelman expenditure unforeseen by the Executive Government? The question is not whether some other expenditure directed to achieving the same or a similar result might have been foreseen by the Executive Government. Nor is it whether the actual payments to be made might have been foreseen other than by the Executive Government. When recommending the adoption of "unforeseen" in its 1979 report, the Senate Standing Committee on Finance and Government Operations specifically rejected "unforeseeable" on the basis that the term would have placed "too great a restriction on the use of the Advance", commenting that "[i]t may be necessary to expend funds urgently which although inherently 'foreseeable' at the time of the preparation of the Appropriation Bills were not in fact 'foreseen'"91. Nothing in the subsequent history of the Advance to the Finance Minister suggests that the term in s 10 of Appropriation Act No 1 2017-2018 should be construed other than consistently with that exposition. The overlay of the CBH Act since 1998 has meant that a risk of additional expenditure being needed in the current fiscal year which is foreseen before the last day on which it is practicable to provide for it in the Bill for an Appropriation Act No 1 and which may have a material effect on the fiscal outlook ought to be disclosed in the budget economic and fiscal outlook report released by the Treasurer at the time of the budget. The fact that additional expenditure in an amount above the threshold of materiality set at $20 million was not disclosed in the Statement of Risks in Budget Paper No 1 tabled by the Treasurer at the time of the budget on 9 May 2017 is against that background an objective indication that the additional expenditure was unforeseen until after the last day on which it was practicable to provide for it in the Bill for Appropriation Act No 1 2017-2018. The plaintiffs in the AME proceeding raised an additional and free- standing constructional argument. The argument was to the effect that the precondition in s 10(1), or perhaps the scope of the power conferred by s 10(2), is in some relevant respect limited by the description in the long title of Appropriation Act No 1 2017-2018 of it as an Act to appropriate money out of 91 Australia, Senate Standing Committee on Finance and Government Operations, Advance to the Minister for Finance, Parliamentary Paper No 217/1979, (1979) at Bell Nettle Gordon Edelman the Consolidated Revenue Fund "for the ordinary annual services of the Government". To the extent that the argument sought to draw some statutory limitation from the statutory description of Appropriation Act No 1 2017-2018 as appropriating money "for the ordinary annual services of the Government", the argument needed only to be stated to be rejected. That language, of course, is drawn from ss 53 and 54 of the Constitution. Language drawn from ss 53 and 54 of the Constitution in the long title of an Appropriation Act cannot sensibly be interpreted as operating to convert the non-justiciable constitutional conception of the ordinary annual services of the Government into some justiciable but undefined statutory conception of the ordinary annual services of the Government. The statutory description in the long title of Appropriation Act No 1 2017-2018 in truth does no more than signify the agreement of the House of Representatives and the Senate that the Appropriation Act is for the ordinary annual services of the Government. The statutory language has no justiciable content. To the extent that the argument sought to draw an implication as to the scope of the appropriations contained in Appropriation Act No 1 2017-2018 from parliamentary practice concerning the content of an Appropriation Act agreed by the House of Representatives and the Senate to be for the ordinary annual services of the Government, the argument was on conceptually firmer ground. Parliamentary practice is relevant to the construction of an Appropriation Act, and in particular is relevant to the construction of s 10 of Appropriation Act No 1 2017-2018. Moreover, parliamentary practice, as it appeared then to have been settled in 1965 and consistently followed between 1965 and 1990 to the effect that a proposed law for the appropriation of money for the ordinary annual services of the Government would not seek to appropriate money for a "new policy", was treated in Brown v West92 as bearing relevantly on construction of an Advance to the Finance Minister in Supply Act (No 1) 1989-90 (Cth). The difficulty for the plaintiffs in the AME proceeding on this branch of their argument is that what appeared in 1990 to be settled and consistent parliamentary practice has not been so since at least 1999. By 2005, as was 92 (1990) 169 CLR 195 at 211. Bell Nettle Gordon Edelman observed in Combet93, there had ceased to be any "clear distinction between 'new' policies and modifications of existing policy". The contemporary position has become even less certain94. The plaintiffs' invitation to parse recent correspondence passing between Ministers and Senate officers so as to draw disputed inferences as to parliamentary practice in respect of the identification of the ordinary annual services of the Government must be rejected. Even if such inferences could be drawn by a court consistently with the privileges of the Senate and the House of Representatives secured by s 53 of the Constitution (a topic on which it is unnecessary to reach any concluded view), the inferences to be drawn from the correspondence would provide an insufficient foundation for drawing a statutory implication which would confine the operation of s 10 to expenditure which a court might characterise as expenditure other than on new policies. Particularly is that so in light of the contents of reports to Parliament of the Secretary to the Department of Finance on advances provided under annual Appropriation Acts to which some of the defendants pointed as demonstrating an asserted practice acquiesced in by the Senate of utilising the Advance to the Finance Minister in Appropriation Acts No 1 to fund new expenditure. The validity of the Finance Determination Having regard to the conclusions stated as to the construction of s 10 of Appropriation Act No 1 2017-2018, the factual arguments of the plaintiffs concerning the validity of the Finance Determination can be addressed quite shortly. Basing their argument on the single sentence in the already quoted passage in the Explanatory Statement accompanying the Finance Determination, which stated that "[t]hese circumstances meet the requirements of section 10 of the Act regarding the expenditure being urgent because it was unforeseen", the plaintiffs in each proceeding argued that the Finance Minister erred in law by conflating the statutory question of his satisfaction as to the expenditure being 93 (2005) 224 CLR 494 at 525 [11], 575 [155]. 94 See Evans and Laing (eds), Odgers' Australian Senate Practice, 14th ed (2016) at Bell Nettle Gordon Edelman urgent with the distinct statutory question of his satisfaction as to the expenditure being unforeseen. The argument treated the Explanatory Statement as if it were a statement of reasons for an administrative decision as distinct from what it is – an explanation of the purpose and operation of a legislative instrument. The argument then invited the Explanatory Statement to be interpreted with "an eye keenly attuned to the perception of error"95. Fairly read, it is simply impossible to treat the sentence as intended to do more than to identify in a truncated form the relevant part of s 10(1) on which the Finance Minister relied in making the Finance Determination. Any question as to the Finance Minister's actual process of reasoning in making the Finance Determination is in any event displaced by his affidavit. The Finance Minister makes plain in his affidavit that he considered the urgency of the expenditure and the unforeseen nature of the expenditure separately. The Finance Minister identified the expenditure as the $122 million which the ABS needed to spend to conduct the postal survey in accordance with the then anticipated Statistics Direction, which was to give effect to the Cabinet decision of 7 August 2017. He was satisfied that the need for that expenditure was urgent because the results of the survey were to be known no later than 15 November 2017. He was satisfied that the expenditure was not provided for in the relevant Schedule because it was unforeseen as at 5 May 2017, being the last day on which the Bill containing the Schedule could have included that expenditure. For reasons already explained, the Finance Minister was not disentitled from regarding the expenditure as urgent merely because the need of the ABS to incur that expenditure, and to do so within the limited timeframe, resulted from the recent decision of the Government itself. Nor was he obliged to take into account the potential operation of ss 74 and 75 of the PGPA Act. The special case in the AME proceeding in any event reveals no basis for considering that either of those sections was engaged. As to s 75, the assistance to be provided by 95 Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259 at 272; [1996] HCA 6, quoting Collector of Customs v Pozzolanic Enterprises Pty Ltd (1993) 43 FCR 280 at 287. Bell Nettle Gordon Edelman the AEC to the ABS could not sensibly be characterised as a transfer of functions. The plaintiffs in the AME proceeding, with the support of the plaintiffs in the Wilkie proceeding, argued that the Finance Minister's explanation in his affidavit that he was "satisfied that the expenditure was not provided for in that Bill because, at the time that Bill was introduced, it was not the Government's policy that the ABS should conduct a postal survey on the issue of same sex marriage, and [he] did not foresee the Government's decision on 7 August 2017 that the ABS should conduct such a survey" must be understood in light of the earlier statement in his affidavit that he was aware from about March 2017 "of suggestions from Ministerial colleagues of alternative means by which the Government's policy of conducting a plebiscite on the issue of whether the law should be changed to allow same-sex couples to marry might be pursued". They argued that the explanation discloses that the Finance Minister erred in law in his consideration of whether the expenditure was unforeseen as at 5 May 2017. The legal error was said to be twofold. First, it was said that the Finance Minister erred by focussing narrowly on expenditure by the ABS on a postal survey rather than treating the expenditure as a species of the genus of expenditure on a plebiscite. Second, it was said that the Finance Minister erred by confining his consideration to whether expenditure by the ABS on a postal survey was foreseen by him personally. The first of those criticisms was itself legally erroneous. Again for reasons already explained, the question for the Finance Minister at that final stage of the inquiry mandated was properly confined to the expenditure that the Finance Minister was satisfied as at 9 August 2017 was needed: the expenditure of $122 million by the ABS on the conduct of the postal survey. He correctly asked: was that expenditure unforeseen as at 5 May 2017? The second of the criticisms was based on too narrow a reading of the Finance Minister's affidavit. The Finance Minister cannot fairly be read as deposing to having confined his attention to whether expenditure by the ABS on a postal survey was personally foreseen by him as at 5 May 2017. He correctly asked: was the expenditure then unforeseen by the Executive Government? The thrust of his evidence was that the conduct of a postal survey was not then Government policy, as it became on 7 August 2017, and that there appeared to him in forming his satisfaction on 9 August 2017 to have been no reason for any Minister to have foreseen as at 5 May 2017 that it might become Government policy. That view of the Finance Minister's evidence is consistent with the Bell Nettle Gordon Edelman disclosure within Budget Paper No 1 of the fiscal risk, within the Finance Minister's portfolio, of needing to spend $170 million to implement the Government's strategy of conducting a same-sex marriage plebiscite under legislation along the lines of the 2016 Bill and the telling absence of disclosure of any fiscal risk of needing to spend that or some lesser amount on some alternative means of conducting a same-sex marriage plebiscite. The process of reasoning disclosed by the Finance Minister involved no error of law. The conclusion he reached through that process of reasoning has not been demonstrated to have been beyond the bounds of legal reasonableness. The validity of the Statistics Direction The Statistics Direction, it will be recalled, directed the Australian Statistician to collect, in relation to specified matters prescribed in specified items in the table in s 13 of the Statistics Regulation, "statistical information" about the proportion of electors who wish to express a view about whether the law should be changed to allow same-sex couples to marry and about the proportion of those electors who are respectively in favour of and against the law being changed to allow same-sex couples to marry. The plaintiffs in the Wilkie proceeding argued that the Statistics Direction exceeded the power of the Treasurer under s 9(1)(b) of the Statistics Act, by notice in writing, to direct the Australian Statistician to "collect such statistical information in relation to [prescribed matters] as is specified in the notice", for three main reasons. First, it was said that the information to be collected did not truly answer the statutory description of statistical information. Next, it was said that the information to be collected was not truly "in relation to" specified matters prescribed in specified items in the table in s 13 of the Statistics Regulation. Lastly, it was said that the power to direct the Australian Statistician to collect such statistical information in relation to prescribed matters as is specified in a notice did not permit the Treasurer to specify from whom the information was to be collected. The first of those arguments itself had two quite distinct strands. One strand of the argument sought to draw a dichotomy between a "vote" or a "plebiscite", on the one hand, and the collection of "statistical information", on the other. The dichotomy is false. The only legally relevant question is whether Bell Nettle Gordon Edelman the Statistics Direction directed the collection of "statistical information". What it directed might well also be described as a "vote" or a "plebiscite". That, or any other, alternative characterisation is irrelevant to its validity. The other strand of the first argument was refined in oral submissions to gossamer. That remaining strand sought to confine the reference to "statistical information" in the Statistics Act so as to exclude information about personal opinion or belief. It was not put, nor could it realistically be put, that the exclusion was by reason of some limitation inherent in the term "statistics" as understood in 1905, when the Statistics Act was enacted, or as understood now. What was argued was that the historical record contains no indication of a colonial practice of collecting information about personal beliefs or opinions, and that the parliamentary debates which preceded the enactment of the Statistics Act reveal a focus on the collection of information about "objective matters". Attention was drawn to the existence within the Statistics Act as enacted of a provision to the effect that "[n]o person shall be liable to any penalty for omitting or refusing to state the religious denomination or sect to which he belongs or adheres"96. The current functional equivalent is a provision which excludes criminal liability "in relation to a person's failure to answer a question, or to supply particulars, relating to the person's religious beliefs"97. That was the "exception", it was said, which proved the "rule". The argument went close to inviting the Court to give effect to a sentiment which was asserted, but by no means demonstrated, to be capable of being inferred to have existed at the time of enactment of the Statistics Act as distinct from giving meaning to its enacted, frequently amended and continuously speaking text. The Court, apparently, was to ignore the fact that the ABS had in practice collected a wide range of data concerning opinions and beliefs in the administration of the Statistics Act since at least the 1960s98. 96 Section 21 of the Statistics Act (as enacted). 97 Section 14(3) of the Statistics Act (as currently in force). 98 See generally Australian Bureau of Statistics, Informing a Nation: The Evolution of the Australian Bureau of Statistics 1905-2005, (2005). Bell Nettle Gordon Edelman Against the background of the principle of construction, articulated in the year of enactment of the Statistics Act, that statutory language is not lightly to be treated as "superfluous, void or insignificant"99, the original and continuing existence within the Statistics Act of a statutory exclusion for collection under compulsion of information about religious belief can indeed be treated as an exception which proves a rule. The rule which the exception proves is that information about personal opinion or belief, including information as to the proportion of persons holding a particular opinion or belief, is and always has been "statistical information". The argument that information about views on whether the law should be changed to allow same-sex couples to marry was not "in relation to" any of the matters prescribed in the items in the table in s 13 of the Statistics Regulation specified in the Statistics Direction was equally untenable. The context of the Statistics Act provides no justification for reading "in relation to" as requiring anything more than the existence of a relationship, whether direct or indirect, between the information to be collected and the subject-matter prescribed100. The information to be collected was plainly "in relation to" each of the subject- matters referred to in the items in the table in s 13 of the Statistics Regulation as "marriages", "Law" and "the social … characteristics of the population". As to the remaining argument concerning the validity of the Statistics Direction, it is sufficient to state that there is nothing in the subject-matter, scope or purpose of the Treasurer's power of direction under s 9(1)(b) of the Statistics Act to exclude specification of a target population. The authority of the AEC The challenge of the plaintiffs in the Wilkie proceeding to the authority of the AEC to assist the ABS in the implementation of the Statistics Direction was founded on the proposition that s 7A of the Electoral Act, in empowering the AEC to make "arrangements for the supply of goods or services", confers a 99 The Commonwealth v Baume (1905) 2 CLR 405 at 414; [1905] HCA 11, quoted in Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 382 [71]; [1998] HCA 28. 100 Cf O'Grady v Northern Queensland Co Ltd (1990) 169 CLR 356 at 374, 376; [1990] HCA 16. Bell Nettle Gordon Edelman "power" on the AEC which is incapable of being exercised outside the "functions" of the AEC identified in s 7 of the Electoral Act. Those functions, it was said, do not extend to allowing the AEC to have a role in a postal survey. The distinction between "functions" and "powers", often drawn in Commonwealth legislation, is not rigid and is not rigidly maintained in the Electoral Act. The reconciliation of ss 7 and 7A of the Electoral Act lies in recognising that making and honouring arrangements under s 7A is itself one of the functions of the AEC identified compendiously in s 7(1)(a) of the Electoral Act. Conclusion Accordingly, the order in the Wilkie proceeding was to the effect that the amended application for an order to show cause be dismissed with costs, and the order in the AME proceeding was that the questions stated by the special case for the opinion of the Full Court be amended and answered as follows: Do either of the plaintiffs have standing to seek the relief sought in the Amended Statement of Claim? Answer: Inappropriate to answer. Is the Advance to the Finance Minister Determination (No 1 of 2017-2018) (Cth) ("the Determination") invalid by reason that the criterion in s 10(1)(b) of the Appropriation Act (No 1) 2017-2018 (Cth) ("the 2017-2018 Act") was not met such that the Finance Minister's power to issue the Determination was not enlivened? Answer: No, it is not invalid. (a) Does question 3(b) raise an issue which is justiciable by a court and within the scope of any matter which the Court has authority to decide? If the answer to question 3(a) is yes, is the Determination invalid by reason that: on its proper construction, s 10 of the 2017-2018 Act does not authorise the Finance Minister to make a the the effect of which determination, that Bell Nettle Gordon Edelman 2017-2018 Act takes effect as if Schedule 1 thereto were amended to make provision for expenditure that is outside the ordinary annual services of the Government; and the expenditure on the ABS Activity (being the activity described the Census and Statistics (Statistical Information) Direction 2017 (Cth)) is not within the meaning of "ordinary annual services of the Government"? Answer: The proper construction of s 10 of the 2017-2018 Act is justiciable. (b) No. Section 10, on its proper construction, did authorise the Finance Minister to make the Determination. If the answer to question 2 or question 3(b) is yes: does question 4(b) raise an issue which is justiciable by a court and within the scope of any matter which the Court has authority to decide? if the answer to question 4(a) is yes, would the drawing of money from the Treasury of the Commonwealth for the ABS Activity in reliance on the appropriation for the departmental item for the [Australian Bureau of Statistics] in the 2017-2018 Act be unauthorised by the 2017-2018 Act on the basis that the expenditure is not within the meaning of "ordinary annual services of the Government"? Answer: The question does not arise. 5. What, if any, relief sought in the Amended Statement of Claim should the plaintiffs be granted? Answer: None. 6. Who should pay the costs of this special case? Bell Nettle Gordon Edelman Answer: The plaintiffs should pay the costs of the special case.

HIGH COURT OF AUSTRALIA PGA AND THE QUEEN APPELLANT RESPONDENT PGA v The Queen [2012] HCA 21 30 May 2012 ORDER Appeal dismissed. On appeal from the Supreme Court of South Australia Representation D M J Bennett QC with P F Muscat SC and A L Tokley for the appellant (instructed by Legal Services Commission (SA)) M G Hinton QC, Solicitor-General for the State of South Australia with K G Lesses for the respondent and intervening on behalf of the Attorney-General for the State of South Australia (instructed by Director of Public Prosecutions S J Gageler SC, Solicitor-General of the Commonwealth with G A Hill intervening on behalf of the Attorney-General of the Commonwealth (instructed by Australian Government Solicitor) J D McKenna SC with G J D del Villar intervening on behalf of the Attorney- General of the State of Queensland (instructed by Crown Law (Qld)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS PGA v The Queen Criminal law – Rape – Husband's immunity from prosecution for rape of wife – Presumption of consent to intercourse by wife in marriage – Appellant charged in 2010 with two counts of rape contrary to s 48 of Criminal Law Consolidation Act 1935 (SA) – Alleged rapes committed in 1963 against then spouse – Legislative amendments enabled institution of proceedings despite lapse of time – Elements of offence of rape in 1963 supplied by common law – Whether in 1963 common law of Australia presumed consent by wife in marriage. Precedent – Judicial method – Development of common law – Whether presumption of consent by wife in marriage was part of common law of Australia – Whether statement of common law in R v L (1991) 174 CLR 379 applied to events alleged to have occurred in 1963. Words and phrases – "common law", "marital exemption", "marital immunity", "presumption of consent", "rape", "retrospective application". Criminal Law Consolidation Act 1935 (SA), s 48. Matrimonial Causes Act 1857 (UK) (20 & 21 Vict c 85). FRENCH CJ, GUMMOW, HAYNE, CRENNAN AND KIEFEL JJ. The appellant and his wife, the complainant, were lawfully married in South Australia on 1 September 1962. At the relevant times in 1963 they remained lawfully married and were cohabiting in South Australia as husband and wife at the house of her parents; there were in force no legal orders or undertakings of any kind which affected their matrimonial relationship. The charges On 5 July 2010, by information of the Director of Public Prosecutions of South Australia, the appellant was charged for trial in the District Court of South Australia with two counts of carnal knowledge, with four counts of assault occasioning actual bodily harm and, what is immediately relevant for this appeal, with two counts of rape (counts 3 and 5) contrary to s 48 of the Criminal Law Consolidation Act 1935 (SA) ("the CLC Act"). The particulars of count 3 were that between 22 March 1963 and 25 March 1963, at Largs Bay in South Australia, the appellant had vaginal sexual intercourse with his wife without her consent. The particulars of count 5 were that on or about 14 April 1963, also at Largs Bay, the appellant had vaginal sexual intercourse with his wife without her consent. The issue before the Court is whether the appellant is correct in his contention that, as a matter of the common law, upon their marriage in 1962 his wife had given her consent to sexual intercourse and thereafter could not retract her consent, at least while they remained lawfully married, with the result that he could not be guilty of raping her as charged by counts 3 and 5. The proposition of law upon which the appellant relies has its source in a statement in extra-judicial writings of Sir Matthew Hale, Chief Justice of the Court of King's Bench (1671-1676), which were first published in 1736 as The History of the Pleas of the Crown. The statement by Hale is more fully set out later in these reasons1, but is encapsulated in the bald proposition that a husband cannot be guilty of a rape he commits upon his wife. It was repeated in East's work A Treatise of the Pleas of the Crown, published in 18032; by Chitty in his A Practical Treatise on the Criminal Law, published in 18163; and by Russell in A 2 Volume 1, Ch 10, §8. 3 Volume 3 at 811. Crennan Treatise on Crimes and Misdemeanors, the first edition of which was published in 18194. In each case the proposition was further repeated in later 19th century editions. What, however, was lacking in all these standard texts was any statement and analysis of reasoning which might have supported the statement by Hale and its continued acceptance. Given this state of affairs, it is perhaps not surprising that the Canadian Criminal Code of 1892 (s 266) and the Criminal Code of Queensland of 1899 (s 347), in defining the crime of rape, included the phrase "not his wife"5. The provisions in the Queensland Code, and those of Western Australia and Tasmania, were to be amended in 1989, 1985 and 1987 respectively6. The attempted abstraction and statement of doctrine in provisions of a code by means of propositions which do not represent generalised deductions from particular instances in the case law occasions difficulty when the common law later is shown to be to different effect7. Justice Holmes, in his essay "Codes, and the Arrangement of the Law"8, wrote: "New cases will arise which will elude the most carefully constructed formula. The common law, proceeding, as we have pointed out, by a series of successive approximations – by a continual reconciliation of cases – is prepared for this, and simply modifies the form of its rule. But what will the court do with a code? If the code is truly law, the court is confined to a verbal construction of the rule as expressed, and must decide the case wrong. If the court, on the other hand, is at liberty to decide ex 4 Volume 1, Bk 2, Ch 6, §1. 5 By 1984 over 40 of the United States retained statute laws conferring some form of marital exemption for rape: People v Liberta 474 NE 2d 567 at 572-573 (1984). However, in that case the New York provision was held invalid as denying the the United States equal protection required by Constitution. the 14th Amendment 6 See R v L (1991) 174 CLR 379 at 402; [1991] HCA 48. 7 See Murray v The Queen (2002) 211 CLR 193 at 206-207 [40]; [2002] HCA 26; Director of Public Prosecutions (NT) v WJI (2004) 219 CLR 43 at 53-54 [30]-[31]; [2004] HCA 47. (1870) 5 American Law Review 1, reprinted in Novick (ed), The Collected Works of Justice Holmes, (1995), vol 1, 212 at 213. Crennan ratione legis, – that is, if it may take into account that the code is only intended to declare the judicial rule, and has done so defectively, and may then go on and supply the defect, – the code is not law, but a mere text-book recommended by the government as containing all at present known on the subject." Indeed, in 1888, among the 13 judges sitting in the Court for Crown Cases Reserved, on the case stated in R v Clarence9 with respect to charges of "unlawfully and maliciously inflicting grievous bodily harm" and "assault occasioning actual bodily harm", contrary to s 20 and s 47 respectively of the Offences against the Person Act 1861 (UK)10 ("the 1861 UK Act"), differing views had been expressed as to whether the consent of the wife to intercourse with her husband had been vitiated by his failure to disclose to her that he was suffering from a contagious venereal disease. Thereafter, in the annotation to s 48 of the 1861 UK Act which appeared in Halsbury's Statutes of England, published in 192911, it was said: "It is said that a husband cannot be guilty of rape upon his wife as a principal in the first degree". (emphasis added) The 28th edition of Archbold's Pleading, Evidence & Practice in Criminal Cases, published in 1931, four years before the enactment of the CLC Act, cited Hale for the proposition expressed as: "It is a general proposition that a husband cannot be guilty of a rape upon his wife ... but it would seem that the proposition does not necessarily extend to every possible case"12. In the intervening period there appears to have been no reported case in England in which a husband had been prosecuted for the rape of his wife during their (1888) 22 QBD 23. 10 24 & 25 Vict c 100. 11 Volume 4 at 615. 13 See R v R [1992] 1 AC 599 at 614. Crennan As it stood in 1963, s 48 of the CLC Act stated: "Any person convicted of rape shall be guilty of felony, and liable to be imprisoned for life, and may be whipped." It is accepted that the elements of the offence of rape identified in s 48 were supplied by the common law. Section 4 of the CLC Act had wholly repealed The Criminal Law Consolidation Act 1876 (SA). As amended by s 13 and the Schedule to the Criminal Law Amendment Act 1925 (SA), s 60 of the 1876 statute had read: "Whosoever shall be convicted of the crime of rape shall be guilty of felony, and, being convicted thereof, shall be liable to be imprisoned for life, with hard labor, and may be whipped."14 The scheme of the legislation in South Australia, in its various forms, was to classify the offence of rape as a felony and to specify the range of punishments upon conviction. This followed the pattern in s 48 of the 1861 UK Act. The legislative emphasis upon the classification of the crime and the punishments which might be inflicted, leaving the elements of the crime itself to the common law, reflected past fluctuations in the statute law. Shortly after the enactment of the 1861 UK Act, there appeared in the 5th edition (1877) of Russell's work, A Treatise on Crimes and Misdemeanors15, the following: "This offence formerly was, for many years, justly visited with capital punishment; but it does not appear to have been regarded as equally heinous at all periods of our Constitution. Anciently, indeed, it appears to have been treated as a felony, and, consequently, punishable with death; but this was afterwards thought too hard; and, in its stead, another severe but not capital punishment was inflicted by William the Conqueror, namely, castration and loss of eyes, which continued till after Bracton wrote, in the reign of Henry III. The punishment for rape was still further mitigated, in the reign of Edward I, by the statute of Westm 1, c 13, which reduced the offence to a trespass, and subjected the party to 14 The Criminal Law Amendment Act 1925 (SA) omitted the words "or any term not less than four years". 15 Volume 1 at 858 (footnote omitted). Crennan two years' imprisonment, and a fine at the King's will. This lenity, however, is said to have been productive of terrible consequences; and it was, therefore, found necessary, in about ten years afterwards, and in the same reign, again to make the offence of forcible rape a felony, by the statute of Westm 2, c 34. The punishment was still further enhanced by the 18 Eliz c 7, s 1." The lapse of time Something should be said respecting the legal significance of the length of time between the alleged conduct in 1963 and the institution of proceedings in 2010. As the CLC Act stood in 1963, it included s 76a16. The effect of s 76a was that in respect of offences, including an offence against s 48, no information was to be laid more than three years after the commission of the offence. Section 76a was repealed by the Criminal Law Consolidation Act Amendment Act 1985 (SA). However, in R v Pinder17 it was held that the repeal of s 76a did not authorise the laying of an information which would deprive a person of immunity already acquired before the repeal of s 76a. The response of the legislature was to reverse the effect of this decision by the enactment of s 72A of the CLC Act by the Criminal Law Consolidation (Abolition of Time Limit for Prosecution of Certain Sexual Offences) Amendment Act 2003 (SA). The result was that a person, such as the appellant, who had acquired immunity by reason of the operation of the repealed s 76a had lost that immunity and could now be prosecuted. Changes have been made to the elements of the offence of rape, beginning with the Criminal Law Consolidation Act Amendment Act 1976 (SA), but it has not been submitted that these changes to the elements of the offence apply retrospectively. The permanent stay application On 6 July 2010 Herriman DCJ gave reasons for dismissing an application by the appellant for a permanent stay of proceedings. His Honour's reasons included the following passage: 16 This had been added by the Criminal Law Consolidation Act Amendment Act 1952 17 (1989) 155 LSJS 65. Crennan "The complainant's evidence is that in 1960 and 1961, when she was 15 or 16, the accused was in a relationship with her and she says that at that time they were living in her parents' house, albeit that he slept in a separate room. They were ultimately married in September 1962, when she was 17, but she says that before that age she had sexual intercourse with him on two occasions. Those two occasions represent counts 1 and 2 on the information. The parties then lived as husband and wife in her parents' house until mid-1963, when they went to their own premises. They separated in The complainant says that on two occasions, in March and April 1963, which she relates to times immediately before and soon after the birth of their first child, the accused had forcible sexual intercourse with her against her will. She says that she did not, at any time during the marriage, complain of carnal knowledge or, indeed, of that forced sexual intercourse. The time for laying of any such charges was then within three years of the act, so that the time for laying a complaint with respect to the carnal knowledge counts expired in about 1964 and, with respect to rape, in about 1966. Those time limits were not abolished until the year 2003. More importantly, there was, and, indeed, there remains, a real question as to whether in 1963 an offence of rape in marriage, as it is commonly called, was then part of the common law of this State." His Honour went on to stay the trial pending the statement for the Full Court of the Supreme Court of South Australia of a case under s 350(2)(b) of the CLC Act. This dealt with the argument of the appellant that at the time of the alleged offences in 1963, he could not, as a matter of law, have committed the crime of rape upon his wife. What was said in 1991 by four of the five members of this Court in R v L18 has been treated by the parties in the present litigation at least as having the result that by 1991 it was no longer the common law in Australia that by 18 (1991) 174 CLR 379 at 390 per Mason CJ, Deane and Toohey JJ, 405 per Crennan marriage a wife gave irrevocable consent to sexual intercourse with her husband. Herriman DCJ saw the outstanding issue for determination as being "was the offence of rape by one lawful spouse of another ... an offence known to the law of South Australia as at 1963?". A question to this effect was stated for consideration by the Full Court19. The Court (Doyle CJ and White J; Gray J dissenting) ordered that the question be answered as follows: "The defendant is liable at law to be found guilty of the offences of rape charged in count 3 and count 5 of the Information, notwithstanding that at the time of the alleged offence he was married to the alleged victim and was cohabiting with her, the marriage giving rise to no presumption of consent on her part to intercourse with her husband, and giving rise to no irrebuttable presumption to that effect." Gray J was of the contrary opinion and would have answered the question in the negative and applied the presumption of irrevocable consent. The appeal to this Court By special leave the appellant appeals to this Court seeking an order setting aside the answer given by Doyle CJ and White J. By Notice of Contention the respondent submits that, regardless of what follows from the decision in R v L20, the answer by Doyle CJ and White J, the majority in the Full Court, is to be supported on the basis that: (a) "the supposed marital exemption to the offence of rape ... was never part of the common law of Australia"; or (b) "if it ever was part of the common law of Australia, it ceased to be so as at the date of the commission of the offences in this matter". For the reasons which follow, if the "marital exemption" ever was part of the common law of Australia, it had ceased to be so by the time of the enactment in 1935 of s 48 of the CLC Act and thus before the date of the commission of the alleged offences charged as count 3 and count 5. It follows that the appeal must be dismissed. That conclusion does not involve any retrospective variation or modification by this Court of a settled rule of the common law. At the time of 19 (2010) 109 SASR 1. The Full Court sat as the Court of Criminal Appeal: see Lipohar v The Queen (1999) 200 CLR 485 at 504 [41]; [1999] HCA 65. 20 (1991) 174 CLR 379. Crennan the commission of the alleged offence the common law rule for which the appellant contends did not exist. The term "the common law" The references above to "the common law" and "the common law of Australia" require further analysis before consideration of the immediate issue concerning the crime of rape upon which this appeal turns. In his contribution under the heading "common law" in The New Oxford Companion to Law21, Professor A W B Simpson distinguishes five senses in which that term is used. The primary sense is that body of non-statutory law which was common throughout the realm and so applicable to all, rather than local or personal in its application. An example of such local or personal laws is the customary mining laws which had applied in various localities in England22. The second sense of the term is institutional, to identify the body of law administered in England by the three royal courts of justice, the King's Bench, Common Pleas and Exchequer, until the third quarter of the 19th century. The third sense is a corollary of the second, the expression "the common law" differentiating the law administered by those courts from the principles of equity administered in the Court of Chancery (and, one should add, from the law applied in the ecclesiastical courts until 1857 and the law applied in courts of admiralty). In that regard, Sir George Jessel MR emphasised in In re Hallett's Estate23 that, while the rules of the common law were "supposed to have been established from time immemorial", those of equity had been invented, altered, improved, and refined by the Chancellors from time to time, and he instanced "the separate use of [ie trust for] a married woman". With the development since the second half of the 19th century of appellate structures governing all species of primary decisions, judicial reasoning has tended not to invoke time immemorial and rather to follow the course which had been taken by the Chancellors in expounding legal principle. 21 Cane and Conaghan (eds), The New Oxford Companion to Law, (2008) at 164-166. 22 See TEC Desert Pty Ltd v Commissioner of State Revenue (WA) (2010) 241 CLR 576 at 587 [30]-[31]; [2010] HCA 49. 23 (1879) 13 Ch D 696 at 710. Crennan The fourth and fifth senses of "common law" identified by Professor Simpson are as follows: "The term 'common law' came, in a fourth sense, to have the connotation of law based on cases, or law evolved through adjudication in particular cases, as opposed to law derived from the analysis and exposition of authoritative texts. Indeed sometimes 'common law' is more or less synonymous with the expression 'case law'. Since the common law was developed by the judges, interacting with barristers engaged in litigation, the expression 'common law' came, in a related fifth sense, to mean law made by judges." This draws attention to a difficulty in the appellant's reliance in this case upon a principle of the common law based upon a statement in a text published in 1736, many years after the death of the author, without citation of prior authority and lacking subsequent exposition in cases where it has been repeated. In that regard, observations by six members of the Court in the Native Title Act Case24 are significant. Their Honours noted that the term "common law" might be understood not only as a body of law created and defined by the courts in the past, but also as a body of law the content of which, having been declared by the courts at a particular time, might be developed thereafter and be declared to be different. Writing at the time of the establishment of this Court, and when he was Professor of Law at the University of Adelaide, Sir John Salmond said25: "The statement that a precedent gains in authority with age must be read subject to an important qualification. Up to a certain point a human being grows in strength as he grows in age; but this is true only within narrow limits. So with the authority of judicial decisions. A moderate 24 Western Australia v The Commonwealth (1995) 183 CLR 373 at 484-486; [1995] HCA 47. 25 Salmond, "The Theory of Judicial Precedents", (1900) 16 Law Quarterly Review 376 at 383. See also Holmes, "Codes, and the Arrangement of the Law", (1870) 5 American Law Review 1, reprinted in Novick (ed), The Collected Works of Justice Holmes, (1995), vol 1, 212 at 212-213. Crennan lapse of time will give added vigour to a precedent, but after a still longer time the opposite effect may be produced, not indeed directly, but indirectly through the accidental conflict of the ancient and perhaps partially forgotten principle with later decisions. Without having been expressly overruled or intentionally departed from, it may become in course of time no longer really consistent with the course of judicial decision. In this way the tooth of time will eat away an ancient precedent, and gradually deprive it of all authority and validity. The law becomes animated by a different spirit and assumes a different course, and the older decisions become obsolete and inoperative." The term "the common law of Australia" Finally, in his treatment of "common law", Professor Simpson refers to the expansion of British imperial power and the creation of "a common law world". The common law was received in the Province of South Australia with effect 19 February 1836, but despite the differing dates of the reception of the common law in the Australian colonies, the common law was not disintegrated into six separate bodies of law; further, what was received included the method of the common law, which in Australia involved judicial determination of particular parts of the English common law which were inapplicable to local conditions26. The "common law" which was received did not include the jurisdiction with respect to matrimonial causes (including suits for declarations of nullity of marriage, judicial separation (a mensa et thoro) and restitution of conjugal rights) which in England was exercised by the ecclesiastical courts. This exclusion appears to have been a deliberate decision by the Imperial authorities27. Further, unlike the situation in England, in the Australian colonies there was to be no 26 Commissioner of Stamps (SA) v Telegraph Investment Co Pty Ltd (1995) 184 CLR 453 at 466-467; [1995] HCA 44; Lipohar v The Queen (1999) 200 CLR 485 at 508-509 [54]-[55]; Brodie v Singleton Shire Council (2001) 206 CLR 512 at 557-558 [99]-[101], 559-560 [104], 588-589 [193]-[196]; [2001] HCA 29; R v Gardener and Yeurs (1829) NSW Sel Cas (Dowling) 108; Ex parte The Rev George King (1861) 2 Legge 1307; Campbell v Kerr (1886) 12 VLR 384. 27 Castles, An Australian Legal History, (1982) at 140-142; Bennett, "The Establishment of Divorce Laws in New South Wales", (1963) 4 Sydney Law Review 241 at 242. Crennan established religion28. The Anglican church was expressly enjoined from exercising any authority or jurisdiction in matrimonial causes29. The result was that the jurisdiction with respect to matrimonial causes, as well as divorce, which has been exercised by the colonial and State courts always has been derived from local statute law, not received "common law". Further, in Skelton v Collins30, Windeyer J said of the reception in the Australian colonies of the doctrines and principles of the common law: "To suppose that this was a body of rules waiting always to be declared and applied may be for some people satisfying as an abstract theory. But it is simply not true in fact. It overlooks the creative element in the work of courts. It would mean for example, that the principle of Donoghue v Stevenson31, decided in the House of Lords in 1932 by a majority of three to two, became law in Sydney Cove on 26th January 1788 or was in 1828 made part of the law of New South Wales by 9 Geo IV c 83, s 25. In a system based, as ours is, on case law and precedent there is both an inductive and a deductive element in judicial reasoning, especially in a court of final appeal for a particular realm or territory." Inductive and deductive reasoning This creative element of both inductive and deductive reasoning in the work of the courts in Australia includes the taking of such steps as those identified by Sir Owen Dixon in his address "Concerning Judicial Method"32. In his words, these are: (i) extending "the application of accepted principles to new 28 Wylde v Attorney-General (NSW) (at the Relation of Ashelford) (1948) 78 CLR 224 at 257, 275-276, 285-286, 298; [1948] HCA 39; Scandrett v Dowling (1992) 27 NSWLR 483 at 534-541; Shaw, The Story of Australia, (1955) at 98-100. 29 Wylde v Attorney-General (NSW) (at the Relation of Ashelford) (1948) 78 CLR 224 at 284-285; Bennett, "The Establishment of Divorce Laws in New South Wales", (1963) 4 Sydney Law Review 241 at 242. 30 (1966) 115 CLR 94 at 134; [1966] HCA 14. 32 (1956) 29 Australian Law Journal 468 at 472. Crennan cases"; (ii) reasoning "from the more fundamental of settled legal principles to new conclusions"; and (iii) deciding "that a category is not closed against unforseen instances which in reason might be subsumed thereunder". To these steps may be added one which is determinative of the present appeal. It is that where the reason or "foundation"33 of a rule of the common law depends upon another rule which, by reason of statutory intervention or a shift in the case law, is no longer maintained, the first rule has become no more than a legal fiction and is not to be maintained. An example is provided by a division of opinion in Brown v Holloway34 and Edwards v Porter35 respectively between this Court and the House of Lords, as to the consequences of the Married Women's Property Act 1882 (UK) ("the 1882 UK Act") and its Queensland counterpart36. Of those cases, it was said in Thompson v Australian Capital Television Pty Ltd37: "The issue [in Edwards v Porter] concerned the effect of the provision in [the 1882 UK Act] that married women were to be capable of suing or being sued as if each were a feme sole, the immediate issue being whether a husband remained liable at common law with his wife for a tort committed by her during joint coverture. In this Court it had previously been decided by Griffith CJ, O'Connor and Isaacs JJ that the liability of the husband was gone38. At common law the wife had been liable for her own torts but there was no way in which that liability could be enforced save by an action against her in which her spouse was joined as a party. The joinder of the husband was necessary only because the liability of the wife could not be made effective without his joinder as a party. The 33 See the statement by Lord Penzance in Holmes v Simmons (1868) LR 1 P & D 523 34 (1909) 10 CLR 89; [1909] HCA 79. 36 Married Women's Property Act 1890 (Q). 37 (1996) 186 CLR 574 at 614-615; [1996] HCA 38. See also at 584-585, 591. 38 Brown v Holloway (1909) 10 CLR 89. Crennan legislation39 removed that procedural disability and therefore the reason which had rendered the husband a necessary party. In Edwards v Porter, without consideration of the reasoning of this Court in Brown v Holloway, their Lordships divided 3:2 in favour of a decision that, notwithstanding the legislation, the husband remained liable to suit with his wife for her torts40. One of the minority, Viscount Cave 'The whole reason and justification for joining a husband in an action against his wife for her post-nuptial tort has therefore disappeared; and it would seem to follow, upon the principle "cessante ratione cessat lex," that he is no longer a necessary or proper party to such an action.'" It is with this reasoning in mind that there is to be understood the earlier statement by Dawson J in R v L42 that: "whatever may have been the position in the past, the institution of marriage in its present form provides no foundation for a presumption which has the effect of denying that consent to intercourse in marriage can, expressly or impliedly, be withdrawn. There being no longer any foundation for the presumption, it becomes nothing more than a fiction which forms no part of the common law." 39 In Brown v Holloway, the Married Women's Property Act 1890 (Q). [See also Married Women's Property Act 1883 (Tas), Married Women's Property Act 1883-4 (SA), Married Women's Property Act 1884 (Vic), Married Women's Property Act 1892 (WA), Married Women's Property Act 1893 (NSW).] 40 Later, in Ford v Ford (1947) 73 CLR 524 at 528; [1947] HCA 7, Latham CJ expressed the opinion that, in accordance with the then prevailing doctrine in Piro v W Foster & Co Ltd (1943) 68 CLR 313; [1943] HCA 32, this Court would follow the House of Lords at the expense of its own earlier decision. In any event, legislation in all States and Territories ensured that married status has no effect on the rights and liabilities of a woman in tort: Balkin and Davis, Law of Torts, 2nd ed (1996) at 836. 41 Edwards v Porter [1925] AC 1 at 10. 42 (1991) 174 CLR 379 at 405. Crennan That statement points the way to the resolution of this appeal. The common law crime of rape The point should first be made that, the issue of irrevocable consent by a wife apart, the common law with respect to the crime of rape did not remain static. Sir Edward Coke in The First Part of the Institutes of the Laws of England early in the 17th century wrote43: "'Rape.' Raptus is, when a man hath carnall knowledge of a woman by force and against her will." In 1957 in their joint reasons in Papadimitropoulos v The Queen44, Dixon CJ, McTiernan, Webb, Kitto and Taylor JJ referred to Australian decisions given in 1915, 1919 and 1947 when stating: "The modern history of the crime of rape shows a tendency to extend the application of the constituent elements of the offence. The 'violenter et felonice rapuit' of the old Latin indictment is now satisfied although there be no use of force: R v Bourke45. The 'contra voluntatem suam' requires only a negative absence of consent; (as to the need of the man's being aware of the absence of consent, see R v Lambert 46). The 'violenter et felonice carnaliter cognovit' is established if there has been some degree of penetration although slight, and no more force has been used than is required to effect it: R v Bourke47; R v Burles48." 43 (1628), Section 190. 44 (1957) 98 CLR 249 at 255; [1957] HCA 74. 45 [1915] VLR 289. 46 [1919] VLR 205 at 213. 47 [1915] VLR 289. 48 [1947] VLR 392. Crennan Their Honours added49: "To return to the central point; rape is carnal knowledge of a woman without her consent: carnal knowledge is the physical fact of penetration; it is the consent to that which is in question; such a consent demands a perception as to what is about to take place, as to the identity of the man and the character of what he is doing. But once the consent is comprehending and actual the inducing causes cannot destroy its reality and leave the man guilty of rape." The reference in Papadimitropoulos to "[t]he modern history of the crime of rape" may be seen as foreshadowing two points with respect to the development of the common law made by Dixon CJ shortly thereafter. In Commissioner for Railways (NSW) v Scott50 Dixon CJ spoke of the gradual growth of the legal system by proceeding by reasoning from accepted notions about remedies and rights to the evolution of rules "to govern new or changed situations to which an ever developing social order gives rise"; he went on to observe that "[t]he resources of the law for superseding or avoiding the obsolescent have for the most part proved sufficient". It is upon that sufficiency that the respondent relies in this appeal. The statement by Hale What now follows in these reasons emphasises that some care is required when visiting what Professor Glanville Williams described as "the museum of the English criminal law"51. The relevant passage in The History of the Pleas of the Crown appears in Ch 58, headed "Concerning felonies by act of parliament, and first concerning rape". The importance of statutory intervention in this respect may be seen from the passage from Russell's treatise set out earlier in these reasons52. 49 (1957) 98 CLR 249 at 261. 50 (1959) 102 CLR 392 at 399-400; [1959] HCA 29. 51 Williams, "The Legal Unity of Husband and Wife", (1947) 10 Modern Law Review Crennan Hale referred to the statement by Bracton that it was a good exception to an appeal (ie formal accusation) of rape that the parties were living in amicable concubinage, adding "and the reason was, because that unlawful cohabitation carried a presumption in law, that it was not against her will". Hale went on to say: "But this is no exception at this day[. I]t may be an evidence of an assent, but it is not necessary that it should be so, for the woman may forsake that unlawful course of life." (emphasis added) This is followed by the critical statement: "But the husband cannot be guilty of a rape committed by himself upon his lawful wife, for by their mutual matrimonial consent and contract the wife hath given up herself in this kind unto her husband, which she cannot retract." (emphasis added) Several points may be made immediately. First, it is apparent from Hale's treatment of Bracton's view in the 13th century of concubinage that he did not regard what had been said in past times as necessarily expressing the common law "at this day" four centuries later. Secondly, Hale gave, as the reason for the proposition that a husband cannot be guilty of a rape upon his wife, the nature in law of the matrimonial relationship. But, in that regard, it was well settled that marriage was constituted by the present consent of the parties expressed under such circumstances as the law required, but without the requirement for consummation to complete the marriage53. Further, as explained later in these reasons54, the ecclesiastical courts did not enforce any duty of sexual intercourse between husband and wife. Thirdly, Hale did not explain the character in law of the proposition respecting rape in marriage, whether it stated an element of the offence, a defence, or an immunity. Nor did Hale refer to any prior cases which might be 53 Dalrymple v Dalrymple (1811) 2 Hag Con 54 at 62-63 [161 ER 665 at 668-669]; R v Millis (1844) 10 Cl & F 534 at 719 [8 ER 844 at 913]. Crennan said to illustrate and support the proposition. From the immediately preceding treatment by Hale of Bracton it is apparent that the proposition is more than a bar to the reception of evidence by the wife or a statement of her absolute testimonial incompetence in this respect. This is further apparent from what immediately follows in Hale's text. This is a treatment of what had been decided at the trial of Lord Audley before the House of Lords in 163155 as follows: "A the husband of B intends to prostitute her to a rape by C against her will, and C accordingly doth ravish her, A being present, and assisting to this rape: in this case these points were resolved, 1. That this was a rape in C notwithstanding the husband assisted in it, for tho in marriage she hath given up her body to her husband, she is not to be by him prostituted to another. 2. That the husband being present, aiding and assisting, is also guilty as a principal in rape, and therefore, altho the wife cannot have an appeal of rape against her husband, yet he is indictable for it at the king's suit as a principal. 3. That in this case the wife may be a witness against her husband, and accordingly she was admitted, and A and C were both executed." It should be added that in the 19th century, it was held in the Supreme Judicial Court of Massachusetts56 that there should be no arrest of judgment on the ground that the indictment had not alleged that the complainant was not the wife of any of those charged with raping her. The relevant passage from Hale had been cited, but Bigelow J responded57: "Such an averment has never been deemed essential in indictments for rape, either in this country or in England. The precedents contain no such allegation. See authorities before cited. A husband may be guilty at common law as principal in the second degree of a rape on his wife by assisting another man to commit a rape upon her; Lord Audley's case, 3 Howell's State Trials, 401; and under our statutes he would be liable to be punished in the same manner as the principal felon. Rev Sts c 133, §1. An indictment charging him as principal would therefore be valid. 55 The Trial of Lord Audley (1631) 3 St Tr 401. 56 Commonwealth v Fogerty 74 Mass 489 (1857). 57 74 Mass 489 at 491 (1857). Crennan Of course, it would always be competent for a party indicted to show, in defence of a charge of rape alleged to be actually committed by himself, that the woman on whom it was charged to have been committed was his wife. But it is not necessary to negative the fact in the indictment." Thus it will be seen that whatever its character in law, Hale's proposition was not framed in absolute terms, given his treatment of Lord Audley's Case. But what is important for the present appeal is further consideration of the reason given by Hale, which was based in an understanding of the law of matrimonial status in the second half of the 17th century when he wrote. Matrimonial status and its incidents in England In the period in which Hale wrote, and until the significant legislative changes in the course of the 19th century, each of the three jurisdictions in England represented by the courts of common law, the courts of equity and the ecclesiastical courts, had distinct roles in matters affecting matrimonial status58. The law applied in the common law courts had absorbed much canon law learning and it defined basic concepts such as legitimacy, procedural rights at law between spouses, and the duties and responsibilities of husbands, including their rights and duties in respect of the contracts and torts of their wives. Marriage had important consequences in property law, for establishing and securing inheritance of legal estates in land. In such contexts a court of common law would determine whether there had been a marriage. The common law also provided forms of action such as breach of promise to marry, criminal conversation by adulterers and seduction of daughters. As already observed59 by reference to the statement of Sir George Jessel MR in In re Hallett's Estate60, equity intervened in a notable fashion by means of the trust to reserve separate property for a wife after her marriage. In his lecture entitled "Of Husband and Wife", Chancellor Kent, after referring to the incompetency at common law of a married woman to deal with her property 58 See the discussion by Professor Cornish in The Oxford History of the Laws of England, (2010), vol 13 at 724-726. 60 (1879) 13 Ch D 696 at 710. Crennan as a feme sole61, went on to contrast the position in equity and described the procedural consequences as follows62: "The wife being enabled in equity to act upon property in the hands of her trustees, she is treated in that court as having interests and obligations distinct from those of her husband. She may institute a suit, by her next friend, against him, and she may obtain an order to defend separately suits against her; and when compelled to sue her husband in equity, the court may order him to make her a reasonable allowance in money to carry on the suit." The provision in the 1882 UK Act and in the corresponding colonial married women's property legislation63 that a married woman was capable of acquiring, holding and disposing of any real or personal property as her separate property, as if she were a feme sole, "without the intervention of any trustee", represented a triumph in statutory form of the principles of equity64. However, it was not until 1862, with the decision of Lord Westbury LC in Hunt v Hunt65, that the Court of Chancery enforced a negative covenant in a deed of separation not to sue in the ecclesiastical courts (or after 1857 in the Divorce Court) for restitution of conjugal rights. Ecclesiastical courts in England had limited powers to order separation of spouses but could not order the dissolution of marriage. This required a statute. Hale wrote in a period in which Parliamentary intervention was beginning. In 1669 a private Act was granted to Lord de Roos, and in 1692 to the Duke of Norfolk; only five such divorces were granted before 1714, but between 1800 and 1850 there were 9066. (Divorce by private Act of the legislature was to be 61 Kent, Commentaries on American Law, (1827), vol 2, 109 at 136. 62 Kent, Commentaries on American Law, (1827), vol 2, 109 at 137. 63 See fn 39. 64 Yerkey v Jones (1939) 63 CLR 649 at 675-676; [1939] HCA 3. 65 (1862) 4 De G F & J 221 [45 ER 1168]; see also Fielding v Fielding [1921] NZLR 66 Sir Francis Jeune, "Divorce", Encyclopaedia Britannica, 10th ed (1902), vol 27, Crennan attempted in 1853 in New South Wales, but the Instructions issued to colonial governors required that any Bill dealing with divorce be reserved for the Queen's pleasure67 and the Royal Assent was only given to the Bill after some delay68.) However, it should be noted that in Scotland since the 16th century, provision had been made for judicial grant of divorce on grounds of adultery of either spouse or malicious desertion for at least four years69. Given the significant settlement of Scots immigrants in the Australian colonies, this element of their inheritance should not be overlooked in understanding the development of Australian institutions70. In 1891, the English Court of Appeal held that habeas corpus would issue to free a wife confined by her husband in his house in order to enforce restitution of conjugal rights71. In R v L72 Brennan J said: "The ecclesiastical courts made decrees for the restitution of conjugal rights but the decree commanded a general resumption of cohabitation and did not purport to compel a spouse to do or abstain from doing particular acts in performance of a connubial obligation73. The legal significance of connubial obligations was to be found in the making of decrees based on breaches of those obligations. Breaches were established only by proof of conduct that was a gross infringement of a connubial right or by proof of a 67 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, 68 Bennett, A History of the Supreme Court of New South Wales, (1974) at 144-145. 69 Walker, A Legal History of Scotland, (2001), vol 6 at 658, 661. 70 See generally, McPherson, "Scots Law in the Colonies", [1995] Juridical Review 191. 71 R v Jackson [1891] 1 QB 671. 72 (1991) 174 CLR 379 at 393. 73 Hunt v Hunt (1943) 62 WN (NSW) 129. Crennan continuous failure to perform a connubial obligation in satisfaction of the corresponding connubial right of the other spouse. The courts exercising jurisdiction in matrimonial causes recognized the mutual rights of husband and wife relating to sexual intercourse and, in granting or withholding their decrees, ascertained whether either party had wilfully and persistently refused to accord the right of sexual intercourse to the other party. From the days of the ecclesiastical courts, however, it was accepted that no mandatory order to compel sexual intercourse would be made." In 1933, when describing the nature and incidents of a decree for restitution of conjugal rights under the jurisdiction conferred by Pt III (ss 6-11) of the Matrimonial Causes Act 1899 (NSW), Dixon J observed in Bartlett v Bartlett74 that, so long as this remedy was retained, it must be treated as a process imposing an obligation, the performance or non-performance of which is ascertainable, and he added75: "On the one hand, it is clear that the obligation requires cohabitation, a physical dwelling together. On the other hand, it is clear that it does not require the resumption of sexual intercourse. It cannot, in fact, and in principle ought not to be understood as attempting to, control motives, feelings, emotions, sentiment or states of mind. Its operation must be limited to overt acts and conduct. ... Perhaps, all that can be said is that the decree of restitution requires the spouse against whom it is directed again to dwell with the other spouse in outward acceptance of the relationship, to act as if they were husband and wife maintaining a matrimonial home and to commence no course of conduct intended to cause a separation." Evatt J set out76 a passage from the reasons of Salmond J in Fielding v Fielding77 in which, with reference to the jurisdiction conferred by s 7 of the Divorce and Matrimonial Causes Act 1908 (NZ) for the issue of decrees for restitution of conjugal rights, Salmond J had said: 74 (1933) 50 CLR 3 at 15-16; [1933] HCA 53. 75 (1933) 50 CLR 3 at 16. 76 (1933) 50 CLR 3 at 18. 77 [1921] NZLR 1069 at 1071. Crennan "The Ecclesiastical Courts [in England] never professed or attempted by means of decrees for restitution of conjugal rights, and imprisonment for disobedience to such decrees, to enforce any duty of sexual intercourse between husband and wife. The basis of such a decree was the wrongful refusal of matrimonial cohabitation. The duty enforced was merely the duty of husband and wife to live together under the same roof in the normal relationship of husband and wife, but without reference to the question of intercourse." The divorce legislation The passage of the Matrimonial Causes Act 1857 (UK)78 ("the 1857 UK Act") later was described by Dicey as "a triumph of individualistic liberalism and of common justice"79. But it was the culmination of many years of agitation. Of the delay, Professor Cornish writes80: "It is less easy to explain why, given the long availability of judicial divorce in Scotland and its spread to other Protestant countries, the step did not come earlier. Jeremy Bentham, for instance, had been an advocate of fully consensual divorce, but subject to time delays for reflection and a bar on the re-marriage of a guilty party." (footnote omitted) The 1857 UK Act terminated the jurisdiction of the ecclesiastical courts in matrimonial matters (s 2) and vested that jurisdiction in the new Court for Divorce and Matrimonial Causes (s 6), but the Court was to act on the principles and rules which had been applied by the ecclesiastical courts (s 22). A decree dissolving marriage might be pronounced on a petition by the husband alleging adultery by the wife, and on a wife's petition, alleging adultery coupled with desertion for at least two years and without reasonable excuse, or alleging adultery with aggravated circumstances including "such Cruelty as without Adultery would have entitled her to a Divorce à Mensâ et Thoro" (ss 27 and 31). 78 20 & 21 Vict c 85. 79 Lectures on the Relation between Law and Public Opinion in England during the Nineteenth Century, 2nd ed (1914) at 347. 80 The Oxford History of the Laws of England, (2010), vol 13 at 781. Crennan In 1858 the Secretary of State for the Colonies conveyed to all colonial governors and legislatures the wish of the Imperial Government that steps be taken to introduce, "as nearly as the circumstances of the Colony will admit", the provisions of the 1857 UK Act81. The colonies acted accordingly, but at different paces: Matrimonial Causes Act 1858 (SA), Matrimonial Causes Act 1860 (Tas), Matrimonial Causes Act 1861 (Vic), Matrimonial Causes Act 1863 (WA), Matrimonial Causes Act 1865 (Q), Matrimonial Causes Act 1873 (NSW). This legislation did not need to abolish in the colonies the non-existent jurisdiction of ecclesiastical courts. Rather, it conferred jurisdiction in matrimonial causes on the Supreme Courts. The differential treatment in the 1857 UK Act between the grounds of divorce available to husbands and wives was carried into the initial colonial legislation. But there followed attempts by New South Wales and Victoria to assimilate and expand the grounds for divorce; the Governor's Instructions required these Bills to be reserved for the Royal Assent on advice of the Imperial Government and, initially, in circumstances of considerable controversy in the colonies, the Royal Pressure for reform of legislation respecting divorce was, however, maintained, particularly in the more populous colonies of New South Wales and Victoria83, and eventually succeeded. In Victoria The Divorce Act 1889 provided extended grounds for divorce84. Advocates of the women's movement in New South Wales were able to press for further liberalisation of the laws, despite the opposition of the churches85. The Divorce Amendment and Extension Act 1892 81 The Despatch by Lord Stanley to the Governor of New South Wales for presentation to both Houses of the Parliament is reproduced in Votes and Proceedings of the Parliament of New South Wales 1859-1860, vol 4 at 1169. 82 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, 83 See the account given by Finlay, To Have But Not to Hold, (2005), Ch 3. 84 Which included adultery, desertion for a period of three years and upwards, habitual drunkenness, habitual cruelty to a wife, conviction for attempt to murder a wife, conviction for having assaulted a wife with intent to cause grievous bodily harm, or repeated assaults on a wife: The Divorce Act 1889 (Vic), s 11. 85 Grimshaw et al, Creating a Nation, (1994) at 172. Crennan (NSW) was expressed in terms similar to those of the Victorian Act. The extended grounds gave colonial women greater access to divorce than their contemporaries in the United Kingdom. Conclusions What was the immediate significance of these 19th century legislative measures for the continued vitality of the reasoning upon which Hale in the 17th century had based his proposition respecting "rape in marriage"? In answering that question it is convenient first to repeat what was said by the Supreme Court of New Jersey in State v Smith86 as follows: "We believe that Hale's statements concerning the common law of spousal rape derived from the nature of marriage at a particular time in history. Hale stated the rule in terms of an implied matrimonial consent to intercourse which the wife could not retract. This reasoning may have been persuasive during Hale's time, when marriages were effectively permanent, ending only by death or an act of Parliament87. Since the matrimonial vow itself was not retractable, Hale may have believed that neither was the implied consent to conjugal rights. Consequently, he stated the rule in absolute terms, as if it were applicable without exception to all marriage relationships. In the years since Hale's formulation of the rule, attitudes towards the permanency of marriage have changed and divorce has become far easier to obtain. The rule, formulated under vastly different conditions, need not prevail when those conditions have changed." To that may be added the statement in that case88: "If a wife can exercise a legal right to separate from her husband and eventually terminate the marriage 'contract', may she not also revoke a 'term' of that contract, namely, consent to intercourse?" 86 426 A 2d 38 at 42 (1981). 87 Clark, The Law of Domestic Relations in the United States, (1968) at 280-282. 88 426 A 2d 38 at 44 (1981). Crennan In similar vein is the statement made from the New South Wales Supreme Court bench by Sir William Windeyer in 1886, in which he regretted that while the State regarded marriage as a civil contract and in this case the contract had been destroyed by the husband "having done his best to degrade you", by reason of the then limited grounds of divorce then available to her in New South Wales, she had no redress89. Insofar as Hale's proposition respecting the nature of the matrimonial contract was derived from an understanding of the principles applied by the ecclesiastical courts, the following may be said. First, as Lord Brougham observed in R v Millis90: "[Marriage] was always deemed to be a contract executed without any part performance; so that the maxim was undisputed, and it was peremptory, 'Consensus, non concubitus, facit nuptias vel matrimonium.'" Secondly, with respect to the exercise of their jurisdiction in suits for restitution of conjugal rights, the ecclesiastical courts did not accept that the exercise of the mutual rights of spouses was to be an occasion of abuse and degradation. The following further remarks of Brennan J in R v L91 are in point: "To acknowledge a connubial obligation not to refuse sexual intercourse wilfully and persistently is to acknowledge that the giving of consent to acts of sexual intercourse is necessary to perform the obligation. It would have been inconsistent with such an obligation to hold that, on marriage, a wife's general consent to acts of sexual intercourse has been given once and for all. If no further consent was required on the part of a wife, how could there be a wilful and persistent refusal of sexual intercourse by her? The ecclesiastical courts never embraced the notion of a general consent to sexual intercourse given once and for all on marriage by either spouse." Thirdly, and in any event, in the Australian colonies jurisdiction with respect to matrimonial causes was not part of the general inheritance of the Supreme 89 Bennett, "The Establishment of Divorce Laws in New South Wales", (1963) 4 Sydney Law Review 241 at 248. 90 (1844) 10 Cl & F 534 at 719 [8 ER 844 at 913]. 91 (1991) 174 CLR 379 at 396. Crennan Courts. They received such jurisdiction only by local statute in the second half of the 19th century. That legislation, as interpreted in the period before the enactment of the CLC Act in 1935, did not require, for compliance with a decree for restitution of conjugal rights, more than matrimonial cohabitation; in particular the duty of matrimonial intercourse was one of imperfect legal obligation because it could not be compelled by curial decree92. Finally, although Hale did not expressly rely upon it, his proposition respecting irrevocable consent could not have retained support from any common law concept that the wife had no legal personality distinct from that of her husband. This was never wholly accepted by the Court of Chancery, given the development there of the trust. The references earlier in these reasons to the significance of the married women's property legislation93 indicate that, by statute, the attitudes of the equity jurisdiction were given effect in the latter part of the 19th century to a significant degree throughout the legal system in England and the Australian colonies. To that may be added the significance of the conferral by the Commonwealth Franchise Act 1902 (Cth) of the universal adult franchise94. It has been said that the gaining of suffrage for women in South Australia in 1894 was critical to the national suffrage movement95. At the turn of the 20th century, suffragists in England were looking to what had been achieved in Australia96. An English suffragist, Dame Millicent Garrett Fawcett, writing in 1911 when women in England had not yet been granted suffrage, observed that97: 92 Bartlett v Bartlett (1933) 50 CLR 3 at 12, 15, 18. 94 See Roach v Electoral Commissioner (2007) 233 CLR 162 at 195-196 [70]-[71]; [2007] HCA 43. 95 Oldfield, Woman Suffrage in Australia, (1992) at 213 (Western Australia followed in 1899 through the passage of the Constitution Acts Amendment Act 1899 (WA)). 96 See for example Zimmern, Women's Suffrage in Many Lands, (1909) at 160; Fawcett, Women's Suffrage: A Short History of a Great Movement, (1911) at 59. 97 Fawcett, Women's Suffrage: A Short History of a Great Movement, (1911) at 59. Crennan "In the Commonwealth of Australia almost the first Act of the first Parliament was the enfranchisement of women. The national feeling of Australia had been stimulated and the sense of national responsibility deepened by the events which led to the Federation of the Independent States of the Australian Continent." By 1930 Isaacs J was able to say that98: "women are admitted to the capacity of commercial and professional life in most of its branches, that they are received on equal terms with men as voters and legislators, that they act judicially, can hold property, may sue and be sued alone". By the time of the enactment in 1935 of the CLC Act, if not earlier (a matter which it is unnecessary to decide here), in Australia local statute law had removed any basis for continued acceptance of Hale's proposition as part of the English common law received in the Australian colonies. Thus, at all times relevant to this appeal, and contrary to Hale's proposition, at common law a husband could be guilty of a rape committed by him upon his lawful wife. Lawful marriage to a complainant provided neither a defence to, nor an immunity from, a prosecution for rape. To reach that conclusion it is unnecessary to rely in general terms upon judicial perceptions today of changes in social circumstances and attitudes which had occurred in this country by 1935, even if it were an appropriate exercise of legal technique to do so. The conclusion follows from the changes made by the statute law, as then interpreted by the courts, including this Court, before the enactment of the CLC Act. Order The appeal should be dismissed. 98 Wright v Cedzich (1930) 43 CLR 493 at 505; [1930] HCA 4. HEYDON J. The events giving rise to this appeal allegedly took place in 1963. At that time it was universally thought in Australia that a husband could not be convicted of having sexual intercourse with his wife without her consent save where a court order operated or where there were other exceptional circumstances. This immunity from conviction was thought to exist because Sir Matthew Hale, who died in 1676, had asserted its existence in The History of the Pleas of the Crown, published in 1736. The reason he assigned was that on marriage wives irrevocably consented to sexual intercourse with their husbands99. Below the immunity will be called "the immunity" or "Hale's proposition". By what warrant did the State of South Australia seek in 2010 to prosecute the appellant for allegedly having sexual intercourse with his wife without her consent more than 47 years earlier? A sufficient answer to that question would be: "It had none, for the reasons that Bell J powerfully states." However, in deference to the arguments put by South Australia, a fuller answer should be given. One matter must be put aside, though the appellant may wish to rely on it at a later stage in these proceedings. This appeal is not directly concerned with any oppressiveness that results from the delay in prosecution. But that tardiness does support the appellant's submission that in 1963 there was no crime of rape for which he could be charged. One primary explanation which South Australia gave to the District Court for its delay was that the immunity created considerable doubt as to whether the appellant was liable for rape. Yet prosecutors have to demonstrate with clarity that the crimes they charge exist. South Australia tells the District Court that the appellant's liability was thought doubtful. It tells this Court that it is certain. South Australia's stance in the District Court is inconsistent with its dogmatic and absolute submissions in this Court. The first of its submissions in this Court was that the immunity never existed100. The second, alternative, submission was that even if the immunity had existed at one time, it had ceased to exist at some indeterminate time before South Australia put only those two submissions. It did not put a third submission – that even if the immunity existed and even if it had not ceased to exist up to now, it should be abolished now. That was a course which the 99 See below at [172]. 100 The first submission is discussed below at [71]-[113]. 101 The second submission is discussed below at [114]-[161]. English courts took in 1991102. It is a course which would raise issues different in some respects from those discussed below. South Australia's first submission: the detailed contentions South Australia's first submission was that it had never been the law, in England or in Australia, that a husband was immune from prosecution for having sexual intercourse with his wife without her consent. The Commonwealth supported that submission. It was based on a number of contentions. The first group of contentions centred on the following points. Hale's work was published 60 years after he died. The relevant part had not been revised before his death. Hale had not supported his statement with any reference to authority. Standing alone his proposition would not constitute the common law. At best it reflected "his view of a custom in 17th century England." As Blackstone asserted, "judicial decisions are the principal and most authoritative evidence, that can be given, of the existence of such a custom as shall form a part of the common law."103 A second group of contentions concerned ecclesiastical law. In the ecclesiastical courts there was no support for Hale's proposition. In ecclesiastical law each spouse had a right to sexual intercourse, but it was only to be exercised reasonably and by consent. This undermined the foundation of Hale's proposition. It revealed him to be mistaken in thinking that the wife's consent was irrevocable. It caused his proposition to be affected by "frailty". South Australia then turned to the history of Hale's proposition after he had enunciated it. It relied on Lord Lowry's very extreme statement that "Hale's doctrine had not been given the stamp of legislative, judicial, governmental and academic recognition."104 So far as "academic recognition" was concerned, South Australia submitted that the only statement of support for the immunity in absolute terms was that of Hale, and that there was no support for it in Blackstone. So far as "judicial … recognition" was concerned, South Australia submitted that Hale's proposition "was never authoritatively declared as part of the common law in Australia." It also submitted that no case had Hale's 102 R v R [1992] 1 AC 599. 103 Commentaries on the Laws of England, (1765), bk 1 at 69. 104 C (A Minor) v Director of Public Prosecutions [1996] AC 1 at 38. proposition as its ratio decidendi. There were only dicta and assumptions that the proposition existed. In some of the cases stating the dicta or resting on the assumptions Hale's proposition was cut down. There were also dicta to the contrary. Hale's proposition was further said to be inconsistent with some authorities. South Australia did not advance detailed submissions about any lack of "legislative" and "governmental" recognition. Perhaps it is hard to say much in support of negative propositions. However, there is a lot to be said against those two. Finally, South Australia submitted that the immunity was completely outdated and offensive to human dignity. It is convenient to deal with South Australia's first submission under the following headings. Defects in Hale's statement of the immunity It is immaterial that Hale's work was published 60 years after his death, that the reference to the immunity appears in a part of it which Hale had not revised, and that he stated no elaborate reasons justifying the immunity. Hale's work is capable of being an accurate account of the law of his day despite these things. There is no reason to suppose that, had he revised the relevant part of his work, he would have considered it desirable to change it. South Australia is not alone in complaining about Hale's failure to cite authorities105. But it is anachronistic to do so. The modern approach to precedent was only struggling to be born in Hale's day106. Hale himself said107: "the decision of courts of justice, though by virtue of the laws of this realm they do bind, as a law between the parties thereto, as to the particular case in question, till reversed by error or attaint; yet they do not 105 Brooks, "Marital Consent in Rape", [1989] Criminal Law Review 877 at 878-883. The first maker of this criticism appears to have been Field J in R v Clarence (1888) 22 QBD 23 at 57. 106 Williams, "Early-modern judges and the practice of precedent", in Brand and Getzler (eds), Judges and Judging in the History of the Common Law and Civil Law: From Antiquity to Modern Times, (2012) 51. 107 The History of the Common Law of England, 6th ed (1820) at 89-90 (emphasis in original). make a law, properly so called; – for that only the king and parliament can do; yet they have a great weight and authority in expounding, declaring, and publishing what the law of this kingdom is; especially when such decisions hold a consonancy and congruity with resolutions and decisions of former times. And though such decisions are less than a law, yet they are a greater evidence thereof than the opinion of any private persons, AS SUCH, whatsoever". Hale's work often does not contain the dense citation of authorities characteristic of modern books. Indeed, many parts of it refer to only a few authorities. That is so of the passages in which he discusses the crime of rape. Hale did not cite direct authority for the immunity, or for his justification of the immunity. Whether there were in fact "authorities" of any kind to be cited on the present point is a matter which a 21st century court cannot easily deal with. It would need the assistance of close research into the question by modern legal historians with high expertise108. Subject to that matter, Hale did point out that there was authority for other propositions that he asserted. Those propositions were not inconsistent with the immunity. To some extent they supported it109. In view of Hale's high reputation for research into the criminal litigation of his day110, it seems likely that in practice husbands were not prosecuted for raping their wives, so that there were no authorities to cite. Even nowadays, a proposition can be correct though no precedent supports it. Ethical and tactical considerations prevent counsel from arguing what they perceive to be the unarguable. There are some propositions which seem too clear to the profession to be contradicted by argument. Propositions of that kind are widely accepted as good law. Subject to the research difficulties referred to in the previous paragraph, a lack of support from earlier authors such as Coke is, as Bell J explains, not significant and does not reveal Hale to be wrong111. Windeyer J once said: "an accepted rule of law is not to be overthrown by showing that history would not support it"112. None of the defects which 108 Australian Crime Commission v Stoddart (2011) 86 ALJR 66 at 81 [70]; 282 ALR 620 at 637; [2011] HCA 47. 109 Lanham, "Hale, Misogyny and Rape", (1983) 7 Criminal Law Journal 148 at 153-156. See also below at [208]. 110 See below at [209]. 111 See below at [200]. 112 Commissioner for Railways (NSW) v Scott (1959) 102 CLR 392 at 447; [1959] HCA 29. supposedly existed in Hale's statement of the immunity prevented it from being an accepted rule of law. Hale and ecclesiastical law South Australia's appeal to ecclesiastical law encounters two difficulties. The first is that while the civil law of marriage was a matter for the ecclesiastical courts, the criminal law was a matter for the common law courts. Thinking in the ecclesiastical courts does not necessarily vitiate an account of the criminal law as administered in the common law courts. The second difficulty is that ecclesiastical law in the 17th century is another field not to be entered without expert assistance. In R v L113 Brennan J wrote at some length about ecclesiastical law. But the sources to which he referred were largely modern. None were contemporary with or earlier than Hale. Lord Lane CJ in R v R114 and Mason CJ, Deane and Toohey JJ in R v L115 pointed out that in Popkin v Popkin116 Sir William Scott (later Lord Stowell) stated: "The husband has a right to the person of his wife, but not if her health is endangered." Mason CJ, Deane and Toohey JJ commented that this showed that "even in the ecclesiastical courts, the obligation to consent to intercourse was not asserted in unqualified terms." If so, it also shows that Hale's proposition was not completely wrong. On the other hand, Brennan J did not think that Sir William Scott's statement showed that a husband had "a right to the person of his wife" without consent117. The submissions of the parties in this appeal did not take the matter further than Brennan J's researches took it. The parties did not cite any expert material throwing light on ecclesiastical law in or before Hale's time. For that reason, it is imprudent to examine it. 113 (1991) 174 CLR 379 at 391-402; [1991] HCA 48. 114 [1992] 1 AC 599 at 604. 115 (1991) 174 CLR 379 at 389. 116 (1794) 1 Hagg Ecc 765n [162 ER 745 at 747]. 117 R v L (1991) 174 CLR 379 at 398. Post-Hale writers South Australia submits that there is no statement of support for Hale's proposition except Hale himself, and that Hale's proposition has received no "academic recognition". That submission is extremely ambitious. It is also utterly incorrect. It is true that Hale's proposition is neither confirmed nor denied by Blackstone or Hawkins. Blackstone was writing at a considerable level of generality about much wider issues than those Hale wrote about. Whether or not it is right to describe Hawkins as "a somewhat second-rate institutional writer"118, it was not open to him to take up Hale's proposition in the first edition of his treatise. It appeared in 1716. Hale's work was not published until 1736. South Australia echoes the Crown's complaint to the House of Lords in R v R119 that the first writer to refer to the immunity after Hale was East in 1803. That is, however, less than 70 years after History of the Pleas of the Crown was published in 1736. In truth, Hale has enjoyed a great reputation. Lord Denning called him "the great Chief Justice Sir Matthew Hale"120. Hale's proposition garnered massive support from professional writers after 1803, and, as academic like too. lawyers emerged, Glanville Williams121, Smith and Hogan122 and Cross and Jones123 acknowledged the correctness of Hale's proposition. Like others who have attacked courts that relied on Hale's proposition124, South Australia failed to grapple with this uncomfortable point. Leading modern writers them from 118 Seaborne Davies, "The House of Lords and the Criminal Law", (1961) 6 Journal of the Society of Public Teachers of Law 104 at 110. 119 [1992] 1 AC 599 at 614. 120 Sykes v Director of Public Prosecutions [1962] AC 528 at 558. 121 Textbook of Criminal Law, 2nd ed (1983) at 236; "The problem of domestic rape", (1991) 141 New Law Journal 205 and 246. 122 Criminal Law, 6th ed (1988) at 430-432 (and all earlier editions). 123 Card (ed), Cross and Jones: Introduction to Criminal Law, 9th ed (1980) at 177 [9.2] (and all earlier editions). 124 For example, Brooks, "Marital Consent in Rape", [1989] Criminal Law Review 877 One source of law is "informed professional opinion"125. Where there is little authority on a question of law, the opinions of specialist writers, particularly their concurrent opinions, are very important in revealing, and indeed in establishing, the law. That is particularly true of books written by practitioners. But it has force in relation to well-respected academic writers as well126. As Lord Reid said: "Communis error facit jus may seem a paradox but it is a fact."127 Owen J put the matter with trenchant simplicity in relation to the first edition of Archbold in 1822. It said128: "A husband … cannot be guilty of a rape upon his wife." Owen J said129: "It seems to me that the consequences of that statement is this: if he was right, then practitioners would follow what he said. Equally, however, if he was wrong, practitioners would follow what he said." Hale's proposition in the courts South Australia relied on Lord Lowry's statement that Hale's proposition had not been "given the stamp of … judicial … recognition."130 South Australia greatly exaggerated the extent to which the authorities cast doubt on the immunity before 1991, when the House of Lords decided it should be abolished131, and four members of this Court said that it had ceased to represent the law132. An illustration is provided by South Australia's submission in relation to R v Clarence: 125 Jones v Secretary of State for Social Services [1972] AC 944 at 1026 per Lord Simon of Glaisdale. 126 Australian Crime Commission v Stoddart (2011) 86 ALJR 66 at 84-98 [90]-[138]; 282 ALR 620 at 641-660. 127 "The Judge as Law Maker", (1972) 12 Journal of the Society of Public Teachers of Law 22 at 25. 128 Archbold, A Summary of the Law Relative to Pleading and Evidence in Criminal Cases, (1822) at 259. 129 R v R – (rape: marital exemption) [1991] 1 All ER 747 at 748. 130 C (A Minor) v Director of Public Prosecutions [1996] AC 1 at 38. 131 R v R [1992] 1 AC 599. 132 R v L (1991) 174 CLR 379 at 390 and 405. "The exemption was first the subject of judicial comment in R v Clarence.133 In R v Clarence, seven of the thirteen judges declined to comment on the issue;134 of the six judges who did, two of them reiterated and confirmed the marital rape proposition,135 three of them questioned or qualified it,136 and another briefly adverted to it without engaging in it.137 The comments of the judges in R v Clarence were obiter dicta, however, taken as a whole they indicate that even as at 1888 there existed no settled view." It is true that the few things said about Hale's proposition in R v Clarence were dicta. The submission is otherwise very misleading. It suggests that only A L Smith J and Pollock B favoured Hale's proposition. In fact the position is as follows. Stephen J supported Hale's proposition138. The following seven judges concurred: A L Smith J139, Mathew J140, Grantham J141, Manisty J142, Wills J146, Huddleston B143, Pollock B144 and Lord Coleridge CJ145. 133 (1888) 22 QBD 23. 134 Lord Coleridge CJ, Huddleston B, Grantham, Manisty and Mathew JJ (quashing the conviction); Charles and Day JJ (dissenting because upholding the conviction). 135 A L Smith J and Pollock B (quashing the conviction). 136 Wills J (quashing the conviction) and Hawkins and Field JJ (dissenting because upholding the conviction). 137 Stephen J (quashing the conviction). 138 R v Clarence (1888) 22 QBD 23 at 46. 139 R v Clarence (1888) 22 QBD 23 at 37. 140 R v Clarence (1888) 22 QBD 23 at 38. 141 R v Clarence (1888) 22 QBD 23 at 46. 142 R v Clarence (1888) 22 QBD 23 at 55. 143 R v Clarence (1888) 22 QBD 23 at 56. 144 R v Clarence (1888) 22 QBD 23 at 61-62 and 63-64. 145 R v Clarence (1888) 22 QBD 23 at 66. 146 R v Clarence (1888) 22 QBD 23 at 33. Hawkins J147 and Field J148 each stated or left open the possibility that in some circumstances a husband could be convicted of raping his wife. But at least the latter two judges plainly thought that Hale's proposition was correct in some circumstances. Day J concurred with Hawkins J149. Charles J concurred with Field J150. its operation South Australia correctly submitted that English trial judges assumed that Hale's proposition was correct, but qualified in special circumstances. Examples of special circumstances included where there was a court non-cohabitation order151, or a decree nisi of divorce had effectively terminated the marriage152, or the husband had given an undertaking to the court not to molest the wife153, or there was an injunction restraining the husband from molesting or having sexual intercourse with the wife154, or there was an injunction and a deed of separation (even though the injunction had expired)155. The outer limit of these exceptions was unilateral withdrawal from cohabitation coupled with a clear indication that the wife's consent to sexual intercourse was On one view, each of the courts that reached these decisions was attempting to achieve justice by tailoring the absolute nature of Hale's proposition to the circumstances before it. Even if the wife could be said to have 147 R v Clarence (1888) 22 QBD 23 at 51. 148 R v Clarence (1888) 22 QBD 23 at 57-58. 149 R v Clarence (1888) 22 QBD 23 at 55. 150 R v Clarence (1888) 22 QBD 23 at 61. 151 R v Clarke [1949] 2 All ER 448. The judge was Byrne J, of whom Owen J said in R v R – (rape: marital exemption) [1991] 1 All ER 747 at 749: "Those who appeared before him will know that he was a judge of the highest repute. As a criminal lawyer, there were not many to excel him in his day." In R v Miller [1954] 2 QB 282 at 289 Lynskey J concurred with R v Clarke. 152 R v O'Brien [1974] 3 All ER 663. 153 R v Steele (1976) 65 Cr App R 22. 154 R v Steele (1976) 65 Cr App R 22 at 25; R v McMinn [1982] VR 53. 155 R v Roberts [1986] Crim LR 188. 156 R v R – (rape: marital exemption) [1991] 1 All ER 747 at 754. given consent by marriage, in those cases it had been withdrawn as a matter of practical reality either because the wife had successfully invoked court process or because the spouses had reached a formal agreement negating consent. Another view is that these cases travel down a road "potholed with ever greater illogicalities"; produce "a gaggle of technical and anomalous distinctions" and "absurdity"; and lack any "relationship to the real world."157 But even if this latter view is correct, it is adverse to South Australia's position. The cases show the enduring toughness of Hale's proposition in legal thought. To destroy Hale's proposition might eliminate formal anomalies and technicalities. But it was a course which many judges found unattractive. Instead they turned their minds to devising narrow exceptions. In two of the cases just referred to, the correctness of Hale's proposition, in the absence of special circumstances, was specifically acknowledged by quotation158. In another, Hale's proposition was thought to be correct at common law though not necessarily satisfactory159. And in R v Miller160, where the prosecution failed to prove any special circumstance and could point to no more than the wife having petitioned for divorce, Hale's proposition was applied. R v Miller renders false South Australia's submission that "no binding precedent can be found where [Hale's] principle represented the ratio decidendi." Contrary to that submission, R v Miller was an "authoritative declaration of the common law on the matter." R v Miller also demonstrates that McGarvie J was wrong to say in R v McMinn161: "There does not seem to have been any recent case in which it was considered whether [Hale's proposition] remains part of the common law." R v Miller was a binding precedent in England until 1991. A second case which applied Hale's proposition is R v J – (rape: marital exemption)162. There are numerous cases, including Australian cases, in which courts have assumed Hale's proposition to be correct at common law163. One is R v 157 Brooks, "Marital Consent in Rape", [1989] Criminal Law Review 877 at 880-882. 158 R v Clarke [1949] 2 All ER 448 at 448; R v Steele (1976) 65 Cr App R 22 at 24. 159 R v McMinn [1982] VR 53 at 55, 57-59 and 61. 160 [1954] 2 QB 282, criticised by Brooks, "Marital Consent in Rape", [1989] Criminal Law Review 877 at 882-883. 161 [1982] VR 53 at 61. 162 [1991] 1 All ER 759. 163 R v Brown (1975) 10 SASR 139 at 141 and 153; R v Cogan [1976] QB 217 at 223; R v Wozniak (1977) 16 SASR 67 at 71; R v Sherrin (No 2) (1979) 21 SASR 250 at 252; R v C (1981) 3 A Crim R 146 at 148-150; R v Caswell [1984] Crim LR 111; (Footnote continues on next page) Kowalski164, in which the English Court of Appeal described Hale's proposition as "clear, well-settled and ancient law". Another is R v Bellchambers165, in which Neasey and Everett JJ said that Hale's proposition "still expresses the common it as "archaic, unjust and they criticised discriminatory"166. A third is Brennan J's statement in R v L167: law", even though "Irrespective of the validity of Hale's reason for declaring that a husband could not be guilty as a principal in the first degree of rape of his wife, it appears that a substantive rule of the common law was established by his declaration." That statement followed more than 10 pages denouncing Hale's reasoning. Thus these last two cases, too, reveal the enduring toughness of Hale's proposition in legal thought. South Australia proffered three authorities that, in its submission, reveal that contrary to Hale's proposition, there was no irrebuttable presumption that on marriage the wife irrevocably consented to sexual intercourse with her husband. In R v Lister168, it was held that while it was lawful for a husband to restrain his wife's liberty where she was making "an undue use" of it, either by "squandering away the husband's estate, or going into lewd company", he could not do so where he had entered into a deed of separation with his wife. In R v Jackson169, the English Court of Appeal held that where a wife refused to live with her husband, he was not entitled to deprive her of liberty by kidnapping her and confining her to his house, even though he had obtained a decree for restitution R v Henry unreported, 14 March 1990 per Auld J: see R v J – (rape: marital exemption) [1991] 1 All ER 759 at 762-763 and Law Commission, Rape within Marriage, Working Paper No 116, (1990) at 97-108; R v Shaw [1991] Crim LR 301; Question of Law Reserved on Acquittal (No 1 of 1993) (1993) 59 SASR 214 at 164 (1987) 86 Cr App R 339 at 341. 165 (1982) 7 A Crim R 463 at 465. 166 (1982) 7 A Crim R 463 at 466. 167 (1991) 174 CLR 379 at 402. 168 (1721) 1 Strange 478 [93 ER 645 at 646]. of conjugal rights. In R v Reid170, that Court held that matrimonial status conferred no immunity on a husband who kidnapped his wife. These cases do not support South Australia's submission. They do not proceed on the basis that on marriage there was a presumption that the wife consented to having her liberty restrained and that she could rebut that presumption by withdrawing her consent. Indeed, in R v Reid171 the Court said of the doctrine in R v Miller that it was "impossible to stretch that doctrine to the extent of saying that on marriage a wife impliedly consents to being taken away by her husband using force or threats of force from the place where she is living." Accordingly, these cases are not inconsistent with Hale's proposition. In 1991, the English Court of Appeal and the House of Lords overturned Hale's proposition172. But it is notable that they did not accept the Crown's submission that "Hale's statement was never the law"173. The rulings of those Courts had retrospective consequences. But they did not hold that Hale's proposition had never been the law. They did not hold that the judgments which had decided, said or assumed that it was correct were wrong at the time they were handed down. Lord Lane CJ said in the Court of Appeal that Hale's proposition had been "accepted as an enduring principle of the common law."174 And the House of Lords altered the law because social conditions had changed quite recently. Hale's proposition was seen as reflecting the society of his day, and its rejection was seen as reflecting the different form which modern society had recently taken175. On that reasoning, Hale's proposition was good law in South Australia in 1963 – a matter relevant to rejection of South Australia's second submission176. 171 [1973] QB 299 at 302. 172 R v R [1992] 1 AC 599. 173 R v R [1992] 1 AC 599 at 602. 174 R v R [1992] 1 AC 599 at 604. 175 R v R [1992] 1 AC 599 at 616. 176 See below at [121]-[161]. Governmental recognition South Australia also relied on Lord Lowry's statement that Hale's proposition "had not been given the stamp of … governmental … recognition."177 That submission too must be rejected. Hale's proposition has received indirect governmental recognition – by the Executive – in two ways. One form of governmental recognition took place in a report of the Criminal Law and Penal Methods Reform Committee of South Australia published in 1976. That report acknowledged that Hale's proposition represented the common law178. It recommended that the immunity be abolished where the event charged took place while the parties were living separately179. There are several other reports before and after the South Australian report also resting on the view that Hale's proposition represented the common law180. Another form of governmental recognition has taken place. Not only in South Australia but in many other places, the authorities did not prosecute charges against husbands accused of raping their wives. This Court was not told of any prosecutions having been brought in England between Hale's time and 1949. In the second half of the 20th century, as exceptions developed to Hale's proposition, there were attempts to prosecute husbands, not for non-consensual 177 C (A Minor) v Director of Public Prosecutions [1996] AC 1 at 38. 178 Criminal Law and Penal Methods Reform Committee of South Australia, Special Report: Rape and Other Sexual Offences, (1976) at 13 [6.2]: see below at [174]. 179 Criminal Law and Penal Methods Reform Committee of South Australia, Special Report: Rape and Other Sexual Offences, (1976) at 15 [6.2.1]. 180 For example, Criminal Law Revision Committee, Sexual Offences, Report No 15, (1984) Cmnd 9213 at 17-18 [2.56]-[2.57]; Law Commission, Rape within Marriage, Working Paper No 116, (1990) at 9-12 [2.8]-[2.10]; American Law Institute, Model Penal Code and Commentaries (Official Draft and Revised Comments), (1980), Pt 2, Art 213 at 271-275, 341-346 and American Law Institute, Model Penal Code: Official Draft and Explanatory Notes, (1985), §213.1(1). The greatest example of this kind, which is not modern but does come from a time when, according to South Australia, legislative changes were being made which would mean that Hale's proposition "crumbled to dust", is the Royal Commission commenting on Stephen's Draft Code: see below at [219]. Sir Rupert Cross thought that Stephen had "one of the highest places" among the makers of English criminal law: "The Making of English Criminal Law: (6) Sir James Fitzjames Stephen", [1978] Criminal Law Review 652 at 661. sexual intercourse with their wives, but for crimes committed in connection with that conduct, such as assault or false imprisonment. So far as these crimes were distinct from sexual intercourse without consent, the prosecutions rested on sound legal thinking, though they were at peril of failing if there were difficulties in establishing that the husband's conduct had gone beyond sexual intercourse without consent181. What the prosecution assumes about the law is not decisive as to what the law is. But it is some guide to the thinking of experienced criminal lawyers. That thinking can be highly persuasive as to what the law is. Legislative recognition Finally, South Australia relied on Lord Lowry's statement that Hale's proposition "had not been given the stamp of legislative … recognition."182 That submission must also be rejected. Some forms of "legislative recognition" are of limited materiality. A statute expressly adopting Hale's proposition in South Australia would have superseded the common law. A statute expressly adopting it outside South Australia would have had slight relevance only to what the common law was in South Australia. Statutes rejecting it would have had little relevance to the position at common law unless they reflected a consistent legislative view of what the public interest demanded183. But there is South Australian legislation recognising Hale's proposition in the sense that it did not interfere with it when there was an occasion to do so. The South Australian Parliament did not adopt the recommendation of the Criminal Law and Penal Methods Reform Committee of South Australia to abolish the immunity when husband and wife were living separately. Instead two provisions relevant to the common law were enacted. First, s 73(3) of the Criminal Law Consolidation Act 1935 (SA) was introduced, removing any presumption that consent to sexual intercourse flowed from marriage. Secondly, s 73(5) was introduced: it prevented a spouse from being convicted not only of rape but also of indecent assault, attempted rape or indecent assault, and assault with intent to commit rape or indecent assault, unless the alleged offence was accompanied by various forms of aggravated conduct184. In substance it 181 See, for example, R v Henry unreported, 14 March 1990 per Auld J, set out in Law Commission, Rape within Marriage, Working Paper No 116, (1990) at 97-108. 182 C (A Minor) v Director of Public Prosecutions [1996] AC 1 at 38. 183 Esso Australia Resources Ltd v Federal Commissioner of Taxation (1999) 201 CLR 49 at 61-63 [23]-[28]; [1999] HCA 67. 184 See below at [175]. overlapped with the common law position precluding convictions of husbands for the conduct of sexual intercourse with their wives without consent. Thus the South Australian Parliament assumed that the immunity existed at common law, and left it in existence. It appears to have gone further in creating an immunity without any common law counterpart for non-aggravated forms of the crimes other than rape to which s 73(5) referred. That state of affairs continued until "Legislative recognition" in places other than South Australia assuming that the immunity existed at common law is relevant to the content of South Australian law – particularly Australian legislation, since there is a single common law in Australia. There are three points to be made. First, in the Code States (Queensland, Tasmania and Western Australia), the definition of rape excluded sexual intercourse by a husband with his wife. The relevant statutes assumed the correctness of Hale's proposition186. Secondly, the numerous changes in State and Territory legislation in the 1970s and 1980s indicated an assumption by each legislature (and by each Executive, which had a large measure of control over what draft legislation was introduced) that Hale's proposition was sound at common law. If not, it would not have been necessary to abolish or qualify it187. Thirdly, Canadian188 and New Zealand189 legislation assumed the correctness of Hale's proposition. An anachronistic and offensive proposition? There are no doubt many criticisms to be made of Hale's proposition if it is to be applied in the circumstances of 2012. But these criticisms do not show that his proposition was necessarily anachronistic or offensive in 17th century circumstances. That would depend on historical analysis which the parties' submissions did not perform. The criticisms therefore do not demonstrate that Hale's proposition was wrong from the outset. They are, however, appropriate arguments to consider when deciding whether Hale's proposition ought to be abandoned. It is a question which legislatures answered affirmatively from the 1980s on. It is not a question which South Australia places before this Court. Whether they are appropriate arguments to consider when deciding whether 185 See below at [176]. 186 See below at [176] n 298. 187 See below at [176]. See also Halabi v Westpac Banking Corporation (1989) 17 NSWLR 26 at 35. 188 See below at [221]. 189 See below at [233]. Hale's proposition dropped out of the law at some point before 1963 is a question which relates to South Australia's second submission. South Australia's first submission rejected It was inherent in South Australia's first submission that all the writers, all the judges, all the government officials, all the law reformers, all the public servants advising Ministers, all the prosecution authorities and all the legislatures who wrote or acted on the assumption that Hale's proposition was the law were wrong. South Australia explicitly adopted a statement to this effect in the Full Court of the Supreme Court of South Australia190. I flatly disagree. South Australia's second submission On the assumption that Hale's proposition was correct for some time after he stated it, South Australia put various contentions denying its applicability in South Australia contended that before 1963 the law had changed so as to nullify Hale's proposition, even though no case had stated this before 1991. This is an unusual invocation of the judicial process. South Australia's contention is different from a contention that this Court should now declare Hale's proposition to be wrong, and do so with effect retrospective to 1963. This latter course presents in an overt form the considerable difficulties which cluster around the making of retrospective changes to the criminal law. South Australia did not choose to tackle these difficulties head on. It did not suggest that this Court should now change the law. Rather, it submitted that the dicta of four Justices in R v L191 recognised that Hale's proposition had ceased to be the law at some time before 1991. South Australia submitted that this time was a time before 1963. In fact, nothing in R v L suggests that the demise of Hale's proposition took place at any specific time before 1991, such as 1963. South Australia's thesis that R v L bound the Full Court of the Supreme Court of South Australia to reach this conclusion must be rejected. South Australia relied on the following arguments as indications that Hale's proposition had ceased to be the law before 1963. South Australia submitted that in R v Jackson192 the denial of the husband's right to use physical coercion on his wife suggested that the immunity 190 R v P, GA (2010) 109 SASR 1 at 9 [43]. 191 (1991) 174 CLR 379 at 390 and 405. 192 [1891] 1 QB 671: see above at [101]. had disappeared from the law. But it does not follow that a husband lost the immunity where he had not employed physical coercion against his wife. South Australia also submitted that Hale's proposition was based on the doctrine of coverture – that the legal status of a wife is assimilated with that of her husband. And it submitted that by the turn of the 20th century the law had come to acknowledge the rights of married women as independent of their husbands' rights. In effect, it submitted that so many inroads had been made on the doctrine of coverture that it could no longer support Hale's proposition. This submission has the drawback that Hale did not base his proposition on the doctrine of coverture. However, the developments on which South Australia relied could be used, and to a degree were used, to support an argument that by the mid-20th century the rights and privileges of married women in Australia were inconsistent with any theory that on marriage wives gave their husbands irrevocable consent to sexual intercourse. South Australia advanced detailed submissions on the capacity of wives, gained by statute, to own property, to sue and be sued, to vote, to have custody of children, and to compel payment of and be compelled to pay child maintenance. It also relied on the termination by statute of discrimination between husbands and wives in relation to the grounds of divorce. In that way South Australia advances an argument for permitting the appellant to be prosecuted now for conduct which allegedly occurred in 1963. Whether it should be accepted depends on four matters. One is whether in fact the changes in the rights and privileges of wives by 1963 were, to use the words of South Australia's written submissions, "entirely inconsistent with the principle that a wife gave irrevocable consent to sexual intercourse with her husband upon marriage." A second concerns the need for certainty in the criminal law. A third concerns whether South Australia's argument could, in a practical sense, work a retrospective change in criminal law. A fourth is whether the task being undertaken is appropriate for the courts as distinct from the legislature. It is convenient to deal with these points in order. Is there inconsistency between the modern rights and privileges of wives and the immunity of husbands for rape? Bell J gives convincing reasons for answering this question in the negative193. Some ideas which tend to render Hale's proposition anachronistic can be discerned in 19th and early 20th century legislation. But the crucial triggers that would push Hale's proposition into disfavour arose in the 1970s. Before that decade there had been some questioning by lawyers of the stated 193 See below at [224]-[248]. justification for Hale's proposition. In that decade questioning began to grow about whether the proposition should be abolished by the legislature. The questioning grew as public concern about the law of rape in general and marital rape in particular began to rise. Law reform agencies began to examine numerous problems in detail. Legislative changes of different kinds were introduced. One trigger was the controversial decision in R v Morgan194 that a mistaken but honest belief that the victim had consented to intercourse was a defence to a rape charge, whether or not that belief was reasonable. R v Morgan was decided on 30 April 1975, seven months before the then Attorney-General for the State of South Australia requested the Criminal Law and Penal Methods Reform Committee of South Australia to report on the law relating to rape and other sexual offences. It was the very first topic the Committee dealt with195. Another trigger concerned whether warnings about the desirability of finding corroboration for the evidence of those complaining that they had been raped rested on unsatisfactory stereotyping. Another trigger was discontent about the rules relating to the cross-examination of complainants about their sexual histories. There were many other issues about which debates began to widen and intensify in those years. The immunity was only one of them. Further, the reasons underlying the legislation which has altered the status of wives over the last 150 years are not necessarily inconsistent with the immunity. To describe Hale's proposition as creating a presumption which no longer has any foundation, and as a fiction not forming part of the common law196, overlooks the fact that a common law rule can rest on a fiction, particularly when the rule in question develops a new and non-fictitious basis. As Lord Sumner observed197: "an established rule does not become questionable merely because different conjectural justifications of it have been offered, or because none is forthcoming that is not fanciful." A fortiori, an established rule does not become questionable merely because a justification which appealed to the minds of lawyers more than 300 years ago has ceased to have appeal now. In Australia, the controversy has been resolved. The resolution lies in abolition of the immunity. Abolition came by degrees. It also came from legislatures. In England, on the other hand, the first decision to abolish the immunity was made by a judge – Simon Brown J, in 1990198. Rougier J, sitting alone, at once refused 195 Criminal Law and Penal Methods Reform Committee of South Australia, Special Report: Rape and Other Sexual Offences, (1976) at 2-8 [2]. 196 R v L (1991) 174 CLR 379 at 405. 197 Admiralty Commissioners v SS Amerika [1917] AC 38 at 56. 198 R v C – (rape: marital exemption) [1991] 1 All ER 755. This was a controversial decision. to follow it199. Then the immunity was abolished by the Court of Appeal and the House of Lords in R v R in 1991. The House of Lords decision has been supported on the ground that Hale's proposition was one which "nobody defended on the merits."200 That, however, is not true201. It is true to say, though, that R v R was based, as Lord Lowry later said, "on a very widely accepted modern view of marital rape"202. But the fact that an idea is very widely accepted does not mean that an inference from it automatically becomes a rule of law. The fact that a rule of law is disliked does not mean that it has ceased to be the law. The fact that a rule of law favourable to the accused is disliked does not mean that the courts rather than the legislature should abolish it. Indeed, after the English courts abolished the immunity, Parliament did as well203, once the matter had been considered by the Law Commission204. And the fact that very many people have disliked a rule of law favourable to the accused for a long time does not mean that it has ceased to be the law at some time in the past. The Permanent Court of International Justice said, in a somewhat different context, in Consistency of Certain Danzig 199 R v J – (rape: marital exemption) [1991] 1 All ER 759. 200 Spencer, "Criminal Law", in Blom-Cooper, Dickson and Drewry (eds), The Judicial House of Lords 1876-2009, (2009) 594 at 604. 201 See Morris and Turner, "Two Problems in the Law of Rape", (1954) 2 University of Queensland Law Journal 247 at 258-259; Howard, Australian Criminal Law, (1965) at 146; Criminal Law and Penal Methods Reform Committee of South Australia, Special Report: Rape and Other Sexual Offences, (1976) at 14 [6.2]; American Law Institute, Model Penal Code and Commentaries (Official Draft and Revised Comments), (1980), Pt 2, Art 213 at 345; Criminal Law Revision Committee, Sexual Offences, Report No 15, (1984) Cmnd 9213 at 21 [2.69]. As late as 15 February 1991, just before the Court of Appeal decision of 14 March 1991 and the House of Lords decision of 23 October 1991 abolishing the immunity, Glanville Williams contended in "The problem of domestic rape", (1991) 141 New Law Journal 205 and 246, that husbands who had non-consensual intercourse with their wives should not be guilty of rape, but should be liable to prosecution for a new statutory crime. 202 C (A Minor) v Director of Public Prosecutions [1996] AC 1 at 38. 203 Criminal Justice and Public Order Act 1994 (UK), s 142, inserting a new s 1 of the Sexual Offences Act 1956 (UK). 204 Law Commission, Criminal Law: Rape within Marriage, Law Com No 205, Legislative Decrees with the Constitution of the Free City205, "[s]ound popular feeling is a very elusive standard." And mere popular feeling, however widespread, is a very unsafe standard to apply in relation to claims that common law rules have fallen into desuetude. Professor Robertson has contrasted R v R with C (A Minor) v Director of Public Prosecutions, in which the House of Lords declined to alter the common law rule that there is a rebuttable presumption that a child aged between 10 and 14 is doli incapax206. He correctly noted that the speeches in R v R contained "almost no argument", only "a bald statement"207. He argued that R v R rested on "the assumption, though it is an untested one, that there is wide consensus in the general public on the question of marital rape."208 He also argued that Lord Lowry's attempt to reconcile a change in the criminal law in R v R with a decision not to change it in C (A Minor) v Director of Public Prosecutions was "specious"209. He said210: "The abolition of the rule on rape, though occasioned by a rape where the man and wife were separated, would in fact apply inside an ongoing marriage. It is sociologically extremely unlikely that this view would command anything like as much support amongst the mass public as would a rule that allowed the conviction of thirteen-year-old auto-thieves. The fact that there had been several cases where judges had attempted to convict husbands for rape is on par with the attempt by the Divisional Court to change the doli incapax rule, where there was extensive quotation from judges who had wanted to but were dutiful to precedent. What is true is that liberal elite opinion was uniform in the rape context, and largely missing in the criminal capacity case. Asked how to square the two results, one Law Lord who had been a member of the bench in C but not in R v R threw his hands in the air and admitted he could not imagine how they squared it. Another though, who had heard C, indicated that his 205 Advisory Opinion, (1935) PCIJ (Ser A/B) No 65 at 53 per Sir Cecil Hurst (President), Judge Guerrero (Vice-President) and Judges Rolin-Jaequemyns, Fromageot, de Bustamante, Altamira, Urrutia, van Eysinga and Wang. 207 Judicial Discretion in the House of Lords, (1998) at 119. 208 Judicial Discretion in the House of Lords, (1998) at 120. 209 Judicial Discretion in the House of Lords, (1998) at 121. 210 Judicial Discretion in the House of Lords, (1998) at 121. decision was prompted by a desire to force the Government's hand and make it legislate." (emphasis in original) The task of assessing public opinion, or even the full range of legal opinion, whether now or in the past, is not an enterprise that is easy for courts to carry out. "The court does not, and cannot, carry out investigations or enquiries with a view to ascertaining whether particular common law rules … command popular assent."211 The question is not whether the view which the House of Lords stated in R v R about the general public's opinion is correct. The point is that if the general public's opinion is a relevant criterion, it is a criterion for the legislature to consider, not the courts212. Certainty in the criminal law Those who seek to foster the rule of law prize certainty. Ordinarily, certainty in the common law is assisted by the doctrine of precedent. Normally, a common law rule is supported by authorities. If an intermediate or ultimate appellate court decides to change the rule, it overrules the authorities and its decision creates a new binding authority. South Australia's submission is not that Hale's proposition be rejected, so that this Court's decision would be a new binding authority with retrospective effect. Instead South Australia submits that at some time which is not clearly specified, Hale's proposition ceased to be the law. At some time in the past that which had a solid existence is said to have dissolved into nothingness. In State Government Insurance Commission v Trigwell213, Gibbs J said: "Although the rules of the common law develop as conditions change, a settled rule is not abrogated because the conditions in which it was formulated no longer exist. It is now fashionable to criticize the rule in Searle v Wallbank[214] as anachronistic, inconsistent with principle and unsuitable to modern conditions, but it is by no means obvious that it would be a reasonable and just course simply to abolish the rule. The 211 State Government Insurance Commission v Trigwell (1979) 142 CLR 617 at 633 per Mason J; [1979] HCA 40. 212 See below at [128]-[129] and [146]-[150] for other arguments favouring legislative change in the criminal law over judicial change. 213 (1979) 142 CLR 617 at 627. See also Mason J at 633 (otherwise than in "a simple or clear case"). question whether the rule should be altered, and if so how, is clearly one for the legislatures concerned rather than for the courts." A fortiori, it does not follow from anachronism that a rule simply dissolves without any court ruling at the time it dissolved, leaving its dissolution to be detected by a court many years or decades later. To the extent that they may be changed retrospectively, uncertainty is inherent in common law rules. But the standard technique is to make the change in a particular case. It is announced as having happened at the time of that case. Even though it operates retrospectively, that retrospective operation tends to affect only quite recent conduct. That was so in R v R and other cases following it: the conduct charged took place only a short time before the law changed. At least in non-criminal fields, if the change is the result of altering "the law's direction of travel by a few degrees" as distinct from setting "it off in a different direction"215, no great harm may follow. Assuming it is permissible for the courts to change the substantive criminal law, R v R is an example of the standard technique. It relied on quite recent changes in the status of married women. It did not purport to announce that a change had taken place many years ago, by reason of changes in status even earlier. South Australia's urging of the latter course engenders much more uncertainty. It invites Bentham's reproach216: "Nebuchadnezzar put men to death for not finding a meaning for his dreams: but the dreams were at least dreamt first, and duly notified. English judges put men to death very coolly for not having been able to interpret their dreams, and that before they were so much as dreamt." Retrospective change in the criminal law and the appropriate institutions to effectuate it South Australia's arguments involve a retrospective change in the criminal law. Indeed, they willingly embrace it. They involve the proposition that conduct no-one saw as attracting criminal liability in 1963 in fact attracted that liability because an historical investigation in 2010-2012 is said to reveal that changes in legal and social conditions at some unspecified time before 1963 caused the conduct to become criminal. And this proposition involves a very serious crime. Rape in 1963 was punishable by life imprisonment and whipping217. 215 Bingham, "The Rule of Law", (2007) 66 Cambridge Law Journal 67 at 71. 216 Bowring (ed), The Works of Jeremy Bentham, (1843), vol IV at 315. 217 See below at [170]. The law's aversion to the judicial creation of crimes. In those circumstances, though it may be trite to do so, it is desirable to recall the law's aversion to the judicial creation or extension of crimes. In the early 17th century Bacon put the central difficulty in a retroactive criminal law thus in Aphorism 8 of his treatise De Augmentis218: "Certainty is so essential to law, that law cannot even be just without it. 'For if the trumpet give an uncertain sound, who shall prepare himself to the battle?'219 So if the law give an uncertain sound, who shall prepare to obey it? It ought therefore to warn before it strikes." And Aphorism 39 read in part220: "Let there be no authority to shed blood; nor let sentence be pronounced in any court upon capital cases, except according to a known and certain law. … Nor should a man be deprived of his life, who did not first know that he was risking it." Hobbes stated in 1651221: "harm inflicted for a fact done before there was a law that forbade it, is not punishment, but an act of hostility: for before the law, there is no transgression of the law". Hence, said Hobbes in 1681222: "A Law is the Command of him, or them that have the Soveraign Power, given to those that be his or their Subjects, declaring Publickly, and plainly what every of them may do, and what they must forbear to do." "The citizen must be able to ascertain beforehand how he stands with regard to the criminal law; otherwise to punish him for breach of that law is purposeless cruelty. Punishment in all its forms is a loss of rights or advantages consequent on a breach of law. When it loses this quality it 218 Spedding, Ellis and Heath (eds), The Works of Francis Bacon, (1877), vol V at 90. 219 1 Corinth. xiv. 8. 220 Spedding, Ellis and Heath (eds), The Works of Francis Bacon, (1877), vol V at 95. 221 Leviathan, reprinted by George Routledge and Sons, 2nd ed (1886) at 143. 222 A Dialogue Between a Philosopher and a Student of the Common Laws of England, Cropsey (ed) (1971) at 71. 223 Criminal Law: The General Part, 2nd ed (1961) at 575. degenerates into an arbitrary act of violence that can produce nothing but bad social effects." Stephen J stated in R v Price224: "the great leading rule of criminal law is that nothing is a crime unless it is plainly forbidden by law." Hence Hayek saw it as crucial to the rule of law that "the coercive power of the state … be used only in cases defined in advance by the law and in such a way that it can be foreseen how it will be used."225 Finally, as Harris said, retroactivity in criminal law is "pointless … because of the brutal absurdity of today commanding someone to do something yesterday."226 South Australia submitted, however, that the change it favoured "does not create a new offence, it merely removes a protection, arguably, formerly held by husbands." It submitted that there was no inhibition against judicial legislation which fell short of creating a new offence. South Australia relied on the following statement by the English Court of Appeal in R v R about the judicial abolition of the immunity227: "The remaining and no less difficult question is whether … this is an area where the court should step aside to leave the matter to the Parliamentary process. This is not the creation of a new offence, it is the removal of a common law fiction which has become anachronistic and offensive and we consider that it is our duty having reached that conclusion to act upon it." With respect to both South Australia and the English Court of Appeal, this is captious. The substantive effect of South Australia's argument is to expose persons to a risk of criminal prosecution for conduct which was not believed to be criminal at the time it was carried out. That is true even though South Australia sees this reasoning as doing nothing more pernicious than removing an anachronistic and offensive fiction. Sir John Smith said, correctly, "it is not clear that there is a difference in principle" between the judicial creation of a new 224 (1884) 12 QBD 247 at 256. 225 The Road to Serfdom, (1944) at 62. See generally Juratowitch, Retroactivity and the Common Law, (2008) at 43-65, 127-138 and 183-197. 226 Harris, Legal Philosophies, 2nd ed (1997) at 146. 227 R v R [1992] 1 AC 599 at 611 per Lord Lane CJ, Sir Stephen Brown P, Watkins, offence in Shaw v Director of Public Prosecutions228 and the judicial abolition of the immunity229. Zecevic v Director of Public Prosecutions (Vict). South Australia also relied on the following statement of Deane J (dissenting) in Zecevic v Director of Public Prosecutions (Vict)230: "There may be circumstances in which an ultimate appellate court is justified in overruling a previous decision of its own with the consequence that what had previously been accepted as a defence to a charge of murder is no longer, and never was, such a defence". This was a somewhat selective quotation. There are three reasons why it does not support South Australia's case. First, Deane J gave as an illustration the case of R v Shivpuri. In that case the House of Lords departed from earlier authority in order to state the true construction of a statute231. That is a very different matter from changing the common law. There are more difficulties in courts continuing to apply an erroneous construction of a statute than continuing to apply the received common law. The courts are masters of the common law, but servants of statutes. Further, the case in question was a special one. The change in construction did not cut down any "liberty" the accused had enjoyed. On the earlier and rejected construction, the accused was free to attempt to commit a crime if circumstances unknown to him made it impossible to do so. On the later and favoured construction, an attempt to commit the crime in those circumstances was criminal. The freedom arising under the earlier construction was a strange type of freedom. It was not a freedom which persons in the accused's position could be said to have been able to rely on: the relevant circumstances were unknown to them. Thus, as Juratowitch says232: "The absence of sensible reliance or liberty considerations in the case meant that the prohibition on criminal retroactivity was, without 228 [1962] AC 220: see below at [144]-[152]. 229 Commentary on R v C [1991] Crim LR 60 at 63. See also Sir John Smith's commentary on R v R [1991] Crim LR 475 at 478. 230 (1987) 162 CLR 645 at 677; [1987] HCA 26. 232 Retroactivity and the Common Law, (2008) at 195. diminishing the strength of that prohibition in general, eminently susceptible to being justifiably overcome in Shivpuri." Secondly, Deane J gave very detailed reasons for not applying his tentative observation to the case before him in Zecevic v Director of Public Prosecutions (Vict). They do not support South Australia's argument. Thirdly, Deane J made it plain that the undesirability of retroactive changes in criminal law adverse to the accused applies as much to abolishing defences as it does to creating new offences. Thus he said233: "It is simply wrong that an accused may be adjudged not guilty or guilty of murder according to the chance of whether his trial is completed before or after this Court has abolished a defence which, under the law which the Court itself had definitively settled at the time the offence was committed, reduced the offence from murder to manslaughter." He called this "a macabre lottery". The macabre character of the lottery is heightened in this case. Those who have caused the prosecution to be brought have allowed 47 years to pass before charging the appellant. Another problem with South Australia's argument is that it invites retrospective judicial legislation which collides with legal structures created by parliamentary legislation. Thus Brennan J, the only Justice in R v L not to state that Hale's proposition had ceased to exist, succinctly and correctly said234: "a mere judicial repeal of the [exception] would extend the liability for conviction of the crime of rape to cases which would be excluded from liability for conviction by s 73(5) of the Criminal Law Consolidation Act."235 Brennan J's point was that s 73(5) permitted convictions for rape in the aggravated circumstances stated in the sub-section, but otherwise preserved the common law "exception" from liability. To "repeal" the common law "exception" would expose husbands to a greater risk of prosecution for acts carried out before s 73(5) was enacted in 1976 than after it. Section 73(5) did not apply retrospectively. The greater exposure of husbands to risk of prosecution would depart significantly from the legislative scheme. It would mean that in 233 (1987) 162 CLR 645 at 677-678 (citation omitted). 234 R v L (1991) 174 CLR 379 at 402. The text has "section" instead of "exception", but this is an error. 235 See below at [175]. 1976 Parliament narrowed the scope of a husband's liability for sexual offences committed against his wife, rather than expanded it. And yet the seeming function of the legislation was to expand liability, not narrow it. Professional attitudes in 1963-1965. The retrospectivity involved in South Australia's arguments is highlighted by considering the following question. What would actually have happened if, instead of the appellant being charged with rape in 2010, he had been charged immediately after the second of the alleged offences had occurred in April 1963? the law "the is what judge says Lord Reid said: Mr Justice Holmes, as is well known, remarked that the bad man "does want to know what the Massachusetts or English courts are likely to do in fact. I am much of his mind. The prophecies of what the courts will do in fact, and nothing more pretentious, are what I mean by the law."237 No doubt it is often unrealistic to assume that people take account of the criminal law in deciding what conduct to engage in238. It is probably particularly unrealistic in relation to violent sexual crimes. However, people should be able to know, by recourse to a competent lawyer, what the legal consequences of a proposed course of action are before embarking on it239. What would a bad man in South Australia have learned if he had asked for a prophecy as to what the South Australian courts, and this Court, would be likely to say in the years 1963 to 1965, for example, if he had been charged in April 1963 with raping his wife in March and April and he had challenged the validity of the indictment or appealed against a conviction? There were at that time seven judges in the Supreme Court of South Australia. The Chief Justice was Sir Mellis Napier, in his 40th year of service on that Court. The senior puisne judge was Sir Herbert Mayo, in his 22nd year of service. Next in seniority came Sir Reginald Roderic St Clair Chamberlain: universally known as "Joe", he did not share the impulsiveness or the radicalism 236 "The Judge as Law Maker", (1972) 12 Journal of the Society of Public Teachers of Law 22 at 22. 237 Holmes, "The Path of the Law", (1897) 10 Harvard Law Review 457 at 461. 238 Rodger, "A Time for Everything under the Law: Some Reflections on Retrospectivity", (2005) 121 Law Quarterly Review 57 at 68. Cf Williams, Criminal Law: The General Part, 2nd ed (1961) at 601-603. 239 See Black-Clawson International Ltd v Papierwerke Waldhof-Aschaffenburg AG [1975] AC 591 at 638; Fothergill v Monarch Airlines Ltd [1981] AC 251 at 279; and R v Rimmington [2006] 1 AC 459 at 480-482 [33]. of his namesake. The other judges were Justices Millhouse, Travers, Hogarth and Bright. This Court comprised Chief Justice Dixon and Justices McTiernan, Kitto, Taylor, Menzies, Windeyer and Owen. It is hard to see where a majority of two was to be found in the Supreme Court of South Australia in favour of the view that Hale's proposition never was, or had ceased to be, the law in South Australia. It is equally hard to see where a majority of three or four in favour of that view was to be found in this Court. Indeed, it is hard to find even one vote for that proposition. This is not simply a crass piece of legal "realism". It does not rest on the personal idiosyncrasies of the individual judges. The probabilities were strongly against either majority because of the particular ideas of the time. They were universal ideas among the Australian judiciary. To overturn Hale's proposition, or to deny that it ever had been the law, or to hold that it had earlier dissolved into nothingness, was to widen the criminal law. It was a legal commonplace in the middle of the 20th century that it was wrong for judges "to declare new offences": that "should be the business of the legislature." So spoke Lord Goddard CJ, Sellers and Havers JJ in 1953, in R v Newland240. They also stated that it was wrong for241: "the judges to declare new crimes and enable them to hold anything which they considered prejudicial to the community to be a misdemeanor. However beneficial that might have been in days when Parliament met seldom or at least only at long intervals it surely is now the province of the legislature and not of the judiciary to create new criminal offences." And in Director of Public Prosecutions v Withers, in 1974, Lord Simon of Glaisdale said242 that it was an "undoubted [principle] of law" that "it is not open to the courts nowadays either to create new offences or so to widen existing offences as to make punishable conduct of a type hitherto not subject to punishment". The same view would prevent any judicial widening of so extremely serious a crime as rape. That view was well-entrenched among judges, practising lawyers and academic lawyers. Contemporary reaction to two surprising decisions of the House of Lords in 1960 and 1961 demonstrates how well-entrenched it was. Director of Public Prosecutions v Smith. The first was a murder case, Director of Public Prosecutions v Smith. The trial judge (Donovan J) directed a 240 [1954] 1 QB 158 at 165. 241 [1954] 1 QB 158 at 167. 242 [1975] AC 842 at 863. jury that if the accused, in doing what he did, must as a reasonable man have contemplated that serious harm was likely to occur to the victim, he was guilty of murder – whether or not the accused actually had that contemplation. The Court of Criminal Appeal (Byrne, Sachs and Winn JJ) allowed Smith's appeal and substituted for the verdict of capital murder a verdict of manslaughter. On 28 July 1960, the House of Lords (Viscount Kilmuir LC, Lords Goddard, Tucker, Denning and Parker of Waddington) allowed a prosecution appeal and restored the conviction for capital murder. Viscount Kilmuir LC said that an accused person who was accountable for his actions and who carried out an unlawful and voluntary act was guilty of murder if the ordinary reasonable man would, in all the circumstances of the case, have contemplated grievous bodily harm as the natural and probable result of that act243. Shaw v Director of Public Prosecutions. The second case was decided on 4 May 1961. The House of Lords (Viscount Simonds, Lords Tucker, Morris of Borth-y-Gest and Hodson; Lord Reid dissenting) held in Shaw v Director of Public Prosecutions that the courts could create new crimes. Viscount Simonds said that the courts had: "a residual power, where no statute has yet intervened to supersede the common law, to superintend those offences which are prejudicial to the public welfare. Such occasions will be rare, for Parliament has not been slow to legislate when attention has been sufficiently aroused. But gaps remain and will always remain since no one can foresee every way in which the wickedness of man may disrupt the order of society."244 Lord Reid, whose reputation, still high, was extremely high in the early 1960s, dissented. He quoted with approval the second passage from R v Newland set out above245. He said246: "the courts cannot now create a new offence". Contemporary reactions to Shaw v Director of Public Prosecutions. Shaw v Director of Public Prosecutions attracted heavy criticism247. Probably for that 243 [1961] AC 290 at 327. 244 [1962] AC 220 at 268. 245 [1962] AC 220 at 274-275. 246 [1962] AC 220 at 276. 247 For example, Hall Williams, "The Ladies' Directory and Criminal Conspiracy: The Judge as Custos Morum", (1961) 24 Modern Law Review 626; Smith, "Commentary", [1961] Criminal Law Review 470; Seaborne Davies, "The House of Lords and the Criminal Law", (1961) 6 Journal of the Society of Public Teachers (Footnote continues on next page) reason, the principle it enunciated has since been narrowed 248. The modern English view corresponds with Lord Reid's. Thus Lord Bingham of Cornhill said249: "there now exists no power in the courts to create new criminal offences". An example of the contemporary reaction to Shaw v Director of Public Prosecutions is what P J Fitzgerald, a prominent Anglo-Irish criminal lawyer, wrote in 1962250: "Few cases in recent years have been quite so disturbing as this. The resuscitation of the judicial power to create crimes runs counter to two cardinal principles of free and democratic government." Fitzgerald put the first as follows251: "[T]he idea of the rule of law … is based on the demand that the citizen should be ruled by laws and not by the whims of men. In the sphere of criminal law this idea has become crystallized as … a principle according to which only breaches of existing criminal law should be punishable. The justification of this principle, which has been adopted as an actual rule in some legal systems, though not in the English legal system, is that the citizen should be able to know beforehand what conduct is permitted and what forbidden; for only in this way can he order his affairs with certainty and avoid coming into conflict with the law. It is this demand for certainty with regard to the provisions of the criminal law that militates against retrospective criminal legislation. When Parliament creates a new crime, it almost invariably legislates for the future only. This, however, is just what the courts cannot do. Our legal system is such that a court can of Law 104; Turpin, "Criminal Law – Conspiracy to Corrupt Public Morals", [1961] Cambridge Law Journal 144. 248 Director of Public Prosecutions v Bhagwan [1972] AC 60 at 80; Knuller (Publishing, Printing and Promotions) Ltd v Director of Public Prosecutions [1973] AC 435; Director of Public Prosecutions v Withers [1975] AC 842. 249 R v Jones (Margaret) [2007] 1 AC 136 at 161-162 [28]; see also at 171 [61] per Lord Hoffmann and 179-180 [102] per Lord Mance. 250 Criminal Law and Punishment, (1962) at 9. 251 Criminal Law and Punishment, (1962) at 9-10. The passage from Bentham to which Fitzgerald refers is from "Truth versus Ashhurst", in Bowring (ed), The Works of Jeremy Bentham, (1843), vol V at 235. It is conveniently set out in R v Rimmington [2006] 1 AC 459 at 480 [33]. only decide a point of law which arises in some actual case before the court, and consequently the court's decision always relates back to the facts of this case, facts which of course precede the decision. If, therefore, a court manufactures a new crime, it thereby determines after the event that the defendant's conduct, which at the time of commission was not prohibited by law, is a criminal offence. To countenance this type of retrospective criminal legislation means that certainty and consequently freedom are at an end. Bentham long ago pointed out that when the judges make law like this, they are treating the citizen as a man treats his dog, hitting him every time he does something to which the master takes exception. Animals and young children can only be trained in this way. Sane and adult members of a free society, however, are entitled to demand first to be told what conduct is forbidden so that they may choose whether or not to keep within the law." Fitzgerald put the second objection to "the creation of new offences by the courts" thus252: "Even suppose that a court could decide that the kind of act which the defendant had done would in future, though not in the instant case, constitute a crime, there is still the objection that this type of proceeding is not consonant with democratic government. If Parliament creates a new crime, the citizens whose liberty is thereby restricted have the consolation that this was done by their elected representatives whom they chose to perform this sort of activity, and whom in due course they may re-elect or reject. The judges, on the other hand, are appointed by the Crown, virtually irremovable and in practice accountable to no one. That such a body should have the power to decree that certain acts shall constitute crimes is totally incompatible with the notion of democracy." In similar vein, Lord Reid said that judicial legislation should be avoided when "public opinion is sharply divided on any question"253. The development of the criminal law raises questions which often sharply divide public opinion. Lord Reid employed arguments similar to those of Fitzgerald in Shaw v Director of Public Prosecutions254. And twice in R v Newland255, the Court of 252 Criminal Law and Punishment, (1962) at 10. 253 "The Judge as Law Maker", (1972) 12 Journal of the Society of Public Teachers of Law 22 at 23. See also Knuller (Publishing, Printing and Promotions) Ltd v Director of Public Prosecutions [1973] AC 435 at 489. 254 [1962] AC 220 at 275. 255 [1954] 1 QB 158 at 165 and 167. Criminal Appeal referred to Sir James Fitzjames Stephen's statement of related arguments 70 years earlier256: "it is hardly probable that any attempt would be made to exercise [a power of declaring new offences] at the present day; and any such attempt would be received with great opposition, and would place the bench in an invidious position. … In times when legislation was scanty, [that power was] necessary. That the law in its earlier stages should be developed by judicial decisions from a few vague generalities was natural and inevitable. But a new state of things has come into existence. On the one hand, the courts have done their work; they have developed the law. On the other hand, parliament is regular in its sittings and active in its labours; and if the protection of society requires the enactment of additional penal laws, parliament will soon supply them. If parliament is not disposed to provide punishments for acts which are upon any ground objectionable or dangerous, the presumption is that they belong to that class of misconduct which it is not desirable to punish. Besides, there is every reason to believe that the criminal law is, and for a considerable time has been, sufficiently developed to provide all the protection for the public peace and for the property and persons of individuals which they are likely to require under almost any circumstances which can be imagined; and this is an additional reason why its further development ought to be left in the hands of parliament." Lord Diplock used similar reasoning in Knuller (Publishing, Printing and Promotions) Ltd v Director of Public Prosecutions257 to advocate a retreat from Shaw v Director of Public Prosecutions. The views of a scholar who received his legal education in Adelaide shortly before the appellant allegedly committed the conduct charged are representative of how lawyers thought at that time and in that place258: "the administration, or working-out, of the criminal law's prohibitions is permeated by rules and principles of procedural fairness ('due process of law') and substantive fairness (desert, proportionality), which very substantially modify the pursuit of the goal of eliminating or diminishing the undesired forms of conduct: such principles as nulla poena sine lege 256 A History of the Criminal Law of England, (1883), vol III at 359-360. 257 [1973] AC 435 at 473-474. See also Lord Simon of Glaisdale at 489. 258 Finnis, Natural Law and Natural Rights, (1980) at 261-262. (and rather precise leges, at that), and the principles which outlaw retroactive proscription of conduct (at the known cost of letting some dubious characters slip through the net), and restrain the process of investigation, interrogation, and trial (even at the expense of that terror which a Lenin knows is necessary for attaining definite social goals)." (emphasis in original) Ideas of this kind, though perhaps less congenial to the mentalities of recent decades, were very familiar to Australian judges in the early 1960s. They universally assented to those ideas. Contemporary reactions to Director of Public Prosecutions v Smith. Director of Public Prosecutions v Smith, too, attracted immediate criticism. In Australia it was rightly seen as an extension of the law of murder. Shortly before his death, Sir Wilfred Fullagar, then a Justice of this Court, entered Sir Owen Dixon's chambers and observed: "Well, Dixon, they're hanging men for manslaughter in England now."259 The doctrine stated in Director of Public Prosecutions v Smith was soon abolished by statute in England260. Glanville Williams called it "the most criticised judgment ever to be delivered by an English court."261 Lord Reid called it a "disaster"262. Dixon CJ, in his 35th year on the High Court and nearing the end of his eighth decade, levelled the most damaging criticism of all at it in Parker v The Queen. Judgment was delivered on 24 May 1963. That was at or shortly before the time the present appellant could have had the question of his immunity from prosecution for allegedly raping his wife in March and April 1963 considered by the courts, had the complainant, the police, the prosecuting authorities, and the courts moved expeditiously. Dixon CJ delivered a dissenting judgment. But it concluded with a passage263 with which all other members of the Court (Taylor, Menzies, Windeyer and Owen JJ) agreed264. In reading that passage, it must be remembered that up to 1963 it had been the High Court's 259 Ayres, Owen Dixon, (2003) at 276. 260 Criminal Justice Act 1967, s 8. 261 Textbook of Criminal Law, 2nd ed (1983) at 81. See also Williams, "Constructive Malice Revived", (1960) 23 Modern Law Review 605. 262 "The Judge as Law Maker", (1972) 12 Journal of the Society of Public Teachers of Law 22 at 29. 263 (1963) 111 CLR 610 at 632; [1963] HCA 14. 264 (1963) 111 CLR 610 at 633. practice to follow decisions of the House of Lords265. It had also been the Court's practice to pay great respect to the decisions of the English Court of Appeal266, and decisions of English High Court judges. That was so even though no appeal lay from any Australian court to those Courts. "In Stapleton v The Queen267 we said: 'The introduction of the maxim or statement that a man is presumed to intend the reasonable consequences of his act is seldom helpful and always dangerous'268. That was some years before the decision in Director of Public Prosecutions v Smith269, which seems only too unfortunately to confirm the observation. I say too unfortunately for I think it forces a critical situation in our (Dominion) relation to the judicial authority as precedents of decisions in England. Hitherto I have thought that we ought to follow decisions of the House of Lords, at the expense of our own opinions and cases decided here, but having carefully studied Smith's Case270 I think that we cannot adhere to that view or policy. There are propositions laid down in the judgment which I believe to be misconceived and wrong. They are fundamental and they are propositions which I could never bring myself to accept." Dixon CJ then said that Smith's case "should not be used as authority in Australia at all." Those were terrible words. They were brooding, sombre and unusually passionate. In them the aged Chief Justice revealed that at the end of his career he had plumbed the depths of an intolerable nightmare. His reaction shows the Court being provoked by a retrospective judicial expansion of criminal liability in England into a determination to preserve crucial common law principles in Australia, not applaud or foster their destruction. This Court had changed its own rules of stare decisis in order to preserve Australian law. Those rules are 265 Piro v W Foster & Co Ltd (1943) 68 CLR 313 at 320; [1943] HCA 32. See also Wright v Wright (1948) 77 CLR 191 at 210; [1948] HCA 33. There Dixon J said that diversity was "an evil", and that the "avoidance [of diversity] is more desirable than a preservation here of what we regard as sounder principle." 266 Waghorn v Waghorn (1942) 65 CLR 289 at 292; [1942] HCA 1. 267 (1952) 86 CLR 358; [1952] HCA 56. 268 (1952) 86 CLR 358 at 365. fundamental to the judicial method. The change was very substantial. Though the High Court continued to be bound by Privy Council decisions, on most points of law there was much more authority from the House of Lords and the English Court of Appeal than the Privy Council. For those reasons Parker v The Queen astonished the Australian legal profession. But its repudiation of the thinking underlying Director of Public Prosecutions v Smith accorded with the ideas of the Australian legal profession. What would the courts have done in 1963-1965? Had the appellant been charged with rape in April 1963, the immediate background to any claim by him of immunity from prosecution would have included the following elements. There was a continuing furore in which Lord Reid's dissent in Shaw v Director of Public Prosecutions was receiving overwhelming favour. There had been an explicit repudiation of English authority for the first time in Australian history271 in part because of its retrospective expansion of criminal liability. There was universal acceptance in the Australian judiciary of conceptions of the kind stated by Stephen, Lord Reid and Fitzgerald. They were conceptions ultimately rooted in the common understanding of the rule of law272. Recourse to the principal English works on criminal law which were available in 1963273 or soon to be published274 would have revealed that Hale's proposition as reflected in recent authorities was stated as the law. The same was true of Australian works 271 However, there had been a premonitory sign in Commissioner for Railways (NSW) v Cardy (1960) 104 CLR 274 at 285; [1960] HCA 45. 272 See Finnis, Natural Law and Natural Rights, (1980) at 270 (proposition (i)). 273 Fitzwalter Butler and Garsia (eds), Archbold: Pleading, Evidence & Practice in Criminal Cases, 35th ed (1962) at 1150 [2880]; Halsbury's Laws of England, 3rd ed (1955), vol 10 at 746 [1437]; Sturge (ed), Stephen's Digest of the Criminal Law (Indictable Offences), 9th ed (1950) at 263 (which includes the footnote Stephen had amended in the 4th ed (1887), the last he published in his lifetime): see below at [218]; Turner (ed), Russell on Crime, 11th ed (1958), vol 1 at 791; Turner (ed), Kenny's Outlines of Criminal Law, 18th ed (1962) at 192; Cross and Jones, An Introduction to Criminal Law, 4th ed (1959) at 76 and 160; Palmer and Palmer (eds), Harris's Criminal Law, 20th ed (1960) at 244. 274 Cross and Jones, An Introduction to Criminal Law, 5th ed (1964) at 79; Smith and Hogan, Criminal Law, (1965) at 290-292. available in 1963275 or shortly thereafter276. This Court was not taken to any works stating that Hale's proposition was not the law. The leading English and Australian academic lawyers specialising in criminal law – Professor Glanville Williams, Sir Rupert Cross, Sir John Smith, Professor Hogan, Professor Howard, Professor Brett, Professor Waller and Professor Morris – were agreed that the immunity existed. No Australian case denied Hale's proposition. A handful of English cases had qualified it, but only to a small degree277. Against that background, four questions arise. What prospect was there that the South Australian courts or the High Court would accede to an attempt by South Australia to effect a judicial extension, retrospectively, of criminal liability? What prospect was there that they would rule that the immunity had never existed? What prospect was there that they would accede to a submission that though the immunity had existed for a long time, it had disappeared some decades earlier? What prospect was there that they would accede to a submission that though the immunity had existed up to 1963, it should be abolished (necessarily with retrospective effect)? To each of those four questions the answer must be: "None". That answer is supported by the fact that once they came to consider the problem, neither the Australian nor the English courts wavered, until 1991, from the view asserted and assumed until then that Hale's proposition was substantially correct278. is necessary, with respect, emphatically to reject the statement that "in 1963, a respectable challenge to Sir Matthew Hale's opinion could have been mounted."279 To believe that is to believe that history can be rewritten in complete defiance of all contemporary evidence. It contradicts the reasoning of the House of Lords in R v R280. Foreseeability. South Australia did not rely on an argument which appealed to the European Court of Human Rights. But it is convenient to mention it. That Court held that the United Kingdom was not in contravention of 275 Weigall and McKay (eds), Hamilton and Addison: Criminal Law and Procedure, 6th ed (1956) at 88; Bourke, Sonenberg and Blomme, Criminal Law, (1959) at 43. See also Morris and Turner, "Two Problems in the Law of Rape", (1954) 2 University of Queensland Law Journal 247. 276 Brett and Waller, Cases and Materials in Criminal Law, 2nd ed (1965) at 300; Howard, Australian Criminal Law, (1965) at 145-147. 277 See above at [97]-[98]. 278 See above at [94]-[100]. 279 R v P, GA (2010) 109 SASR 1 at 13 [66] per Doyle CJ. 280 [1992] 1 AC 599: see above at [103]. Art 7 of the European Convention on Human Rights by reason of the decision in R v R because the abolition of the immunity was reasonably foreseeable281. This is a highly questionable justification for retrospective judicial change in the criminal law. But even if it is an arguable justification, it cannot apply here. It may be one thing to hold that it was reasonably foreseeable in 1990 that the immunity might be abolished in 1991. But in 1963 it was not reasonably foreseeable that if the matter came to court there would be an immediate abolition of the immunity by judicial means282. The significance of R v L. South Australia submitted that statements in R v L supported its second submission283. But it accepted that they were unnecessary to the decision in that case, and hence were dicta only. They were dicta about an aspect of the common law – a presumed incapacity to withdraw consent – which had been abolished by statute in every Australian jurisdiction. Further, they were dicta which said only that Hale's proposition was not in 1991 part of the common law of Australia. They said nothing in terms about what the position was in 1963. For the Court in this appeal the question is whether, as a matter of ratio decidendi, not obiter dicta, South Australia's second submission should be recognised as correct. An annihilatingly powerful reason for not recognising it is that it criminalises conduct which, if it took place, was lawful at the time it took place. Conclusion on South Australia's second submission. A decision by the legislature of South Australia after 1963 to enact a law retrospectively providing that the immunity was abolished with effect from a date before 1963 would have been subject to criticism from many quarters. That would have been significant, not because the critics would have been numerous, but because their criticisms would have been most trenchant284. South Australia's submission that the same result is to be achieved by a judicial decision to that effect is open to even greater criticism. The position of the judiciary in this respect is not superior to that of the legislature. For those reasons South Australia's second submission must be rejected. 281 SW v United Kingdom (1995) 21 EHRR 363 at 402 [43/41]. 282 Cf R v C [2004] 1 WLR 2098; [2004] 3 All ER 1, dealing with conduct in 1970 – a case exemplifying to a very marked degree the fallacy known to personal injury lawyers of finding foreseeability solely on the basis of hindsight. 283 (1991) 174 CLR 379 at 390 per Mason CJ, Deane and Toohey JJ and 405 per 284 See Walker, The Rule of Law, (1988) at 315-324. Issues which need not be resolved The appellant contended that a common law rule should be created by this Court to the effect that when there is a judicial change to the common law it only operates prospectively, not retrospectively. This would involve overruling prior authority285. That contention would only become a live issue if the common law as stated by Hale were held to have changed in the past (as South Australia submitted) or were to be changed now (as South Australia did not submit). It is not correct to arrive at either holding. Hence the need to consider the contention does not arise. Orders The appeal should be allowed. For the answer to the question of law given by the majority in the Full Court of the Supreme Court of South Australia there should be substituted the answer: "No". 285 Ha v New South Wales (1997) 189 CLR 465 at 503-504; [1997] HCA 34. Bell BELL J. In 2010, an Information was filed in the District Court of South Australia, charging the appellant with offences including two counts of rape. The complainant in each count was his then wife, GP, with whom he was living at the time. The offences of rape are alleged to have occurred in March and April 1963. It cannot be sensibly suggested that the appellant would have been prosecuted for those offences, had the allegations come to the attention of the authorities in 1963. This is because at that time it was understood that the crime of rape could not be committed by a husband against his wife with whom he was living ("the immunity"). A husband was amenable under the criminal law for any other offence of violence committed against his wife. The imposition of criminal liability on a person for an act or omission to which criminal liability did not attach at the date the act was done or omitted to be done is contrary to fundamental principle286. It is said that the prosecution of the appellant today for his conduct in 1963 does not offend that principle because the immunity has never formed part of the common law of Australia or, if it did, it had ceased to do so sometime before 1963. The first of these alternatives rests on demonstrating either the absence of an authoritative source for the immunity or that in R v L287 this Court declared the common law in terms that denied its existence. For the reasons that follow, neither of those propositions should be accepted. Nor should this Court now hold that, on some date before 1963, a settled rule of the common law affecting liability for a serious criminal offence ceased to exist. Procedural history The appellant was due to stand trial in the District Court of South Australia (Herriman DCJ) on 5 July 2010. On 29 June 2010, he applied to quash the counts in the Information charging him with rape contrary to s 48 of the Criminal Law Consolidation Act 1935 (SA) ("the CLC Act"). Herriman DCJ stated a case reserving a question of law for the determination of the Full Court of the Supreme Court of South Australia288. His Honour set out the following facts: each count charged an act of non-consensual penile-vaginal sexual intercourse with GP; GP and the appellant were married and cohabiting as husband and wife at the date of each alleged offence; and no legal orders or undertakings of any kind affected the marital relationship on those dates. The question of law that his Honour reserved is: 286 Nullum crimen sine lege; nulla poena sine lege (no crime or punishment without law). See Dicey, Introduction to the Study of the Law of the Constitution, 10th ed 287 (1991) 174 CLR 379; [1991] HCA 48. 288 CLC Act, s 350(2)(b). Bell "Was the offence of rape by one lawful spouse of another, in the circumstances as outlined above, an offence known to the law of South Australia as at 1963?" The Full Court, by majority (Doyle CJ and White J, Gray J dissenting), answered the question289 in this way290: "The defendant is liable at law to be found guilty of the offences of rape charged in count 3 and count 5 of the information, notwithstanding that at the time of the alleged offence he was married to the alleged victim and was cohabiting with her, the marriage giving rise to no presumption of consent on her part to intercourse with her husband, and giving rise to no irrebuttable presumption to that effect." By special leave, the appellant appeals to this Court against the answer given by the majority in the Full Court. The law of rape in South Australia Before turning to the Full Court's reasons, some reference should be made to the history of the law governing liability for rape in South Australia and to the decision in R v L. In 1963, the punishment for the offence of rape was provided by s 48 of the CLC Act: "Any person convicted of rape shall be guilty of felony, and liable to be imprisoned for life, and may be whipped." The elements of the offence of rape were supplied by the common law. The understanding that a husband could not be guilty as a principal in the first degree of the rape of his wife is traced to the statement of Sir Matthew Hale in The History of the Pleas of the Crown291: 289 Doyle CJ (White J concurring) restated the question as "whether Mr P can, as a matter of law, properly be convicted of count 3 and count 5 in the circumstances outlined": R v P, GA (2010) 109 SASR 1 at 4 [6]. 290 R v P, GA (2010) 109 SASR 1 at 19 [93] per Doyle CJ, 45 [174] per White J. 291 (1736), vol 1, c 58 at 629. Bell "But the husband cannot be guilty of a rape committed by himself upon his lawful wife, for by their mutual matrimonial consent and contract the wife hath given up herself in this kind unto her husband, which she cannot retract." There does not appear to have been a single case in which a husband had been prosecuted for the rape of his wife with whom he was living in any common law jurisdiction at the date of the conduct with which the appellant is charged. By that date, as will appear, the justification for the immunity may have come to rest more upon the notion that the criminal law ought not to intrude into the marital bedroom, than upon the fiction of the wife's irrevocable consent. By the 1970s, the idea that there could be any justification for conferring immunity on a husband for the rape of his wife was the subject of critical academic attention and pressure for reform of the law292. South Australia was the first of the Australian jurisdictions to respond to the call for reform of the law of rape. In December 1975, the Attorney-General appointed a Committee of persons distinguished for their knowledge of the criminal law to report on the law relating to sexual offences293. The Committee was chaired by Justice Roma Mitchell of the Supreme Court of South Australia. The Committee submitted its Report to the Attorney-General in March 1976294. The Report contained a summary of the law stating that a husband could not be 292 The Women's Electoral Lobby was formed in 1972. See s 2 of its "Draft Bill and Other Recommendations on Sexual Offences (Superseding Draft Bill of August 1977; plus addenda of July 1978)", in Scutt (ed), Rape Law Reform, (1980) 265 at 268. See also Scutt, "Consent in Rape: The Problem of the Marriage Contract", (1977) 3 Monash University Law Review 255; Buddin, "Revision of Sexual Offences Legislation: A Code for New South Wales?", (1977) 2 University of New South Wales Law Journal 117 at 128-130; Sallmann and Chappell, Rape Law Reform in South Australia: A Study of the Background to the Reforms of 1975 and 1976 and of their Subsequent Impact, Adelaide Law Review Research Paper No 3, (1982) at v, 1-4, 10, 19-23. See, further, LeGrand, "Rape and Rape Laws: Sexism in Society and Law", (1973) 61 California Law Review 919; Brownmiller, Against Our Will: Men, Women and Rape, (1975); Geis, "Lord Hale, Witches, and Rape", (1978) 5 British Journal of Law and Society 26. 293 The other members of the Committee were Professor Howard, Hearn Professor of Law at Melbourne University and the author of the leading text on the criminal law in Australia, and Mr David Biles, the Assistant Director (Research) at the Australian Institute of Criminology. Mr Warren Brent Fisse, then Reader in Law at the University of Adelaide, was engaged as a consultant to the Committee. 294 Criminal Law and Penal Methods Reform Committee of South Australia, Special Report: Rape and Other Sexual Offences, (1976). Bell guilty as a principal in the first degree of the rape of his wife. The Committee noted judicial development of the law in England allowing an exception to the immunity in the case of a wife who had obtained an order for separation relieving her from the obligation to cohabit with her husband295. It recommended that the immunity should be confined such that a husband should be liable to conviction for the rape of his wife whenever the act constituting the rape was committed while the two were living apart and not under the same roof296. Following receipt of the Committee's Report, the South Australian Parliament amended the CLC Act297 by introducing s 48(1), which stated the elements of the offence of rape, and s 73, which relevantly provided: "(3) No person shall, by reason only of the fact that he is married to some other person, be presumed to have consented to sexual intercourse with that other person. (5) Notwithstanding the foregoing provisions of this section, a person shall not be convicted of rape or indecent assault upon his spouse, or an attempt to commit, or assault with intent to commit, rape or indecent assault upon his spouse (except as an accessory) unless the alleged offence consisted of, was preceded or accompanied by, or was associated with – assault occasioning actual bodily harm, or threat of such an assault, upon the spouse; an act of gross indecency, or threat of such an act, against the spouse; 295 In R v Clarke [1949] 2 All ER 448, Byrne J held that, although as a general proposition of law a husband could not be guilty of rape of his wife, there was an exception where the wife was living separately and with the protection of a court order. The exception was recognised but did not apply in the circumstances in R v Miller [1954] 2 QB 282 (see fn 339 below) and it was extended in R v O'Brien [1974] 3 All ER 663. See Criminal Law and Penal Methods Reform Committee of South Australia, Special Report: Rape and Other Sexual Offences, (1976) at 296 Criminal Law and Penal Methods Reform Committee of South Australia, Special Report: Rape and Other Sexual Offences, (1976) at 15 [6.2.1]. 297 Criminal Law Consolidation Act Amendment Act 1976 (SA). Bell an act calculated seriously and substantially to humiliate the spouse, or threat of such an act; or threat of the commission of a criminal act against any person." In the period following the South Australian reforms, the parliaments of each of the States and Territories enacted legislation with the evident intention of modifying or abolishing the immunity. This process of reform was completed by December 1991, when R v L was decided. In the Code States, this was achieved by removing the words "not his wife" from the definition of the offence298. In the Northern Territory, it was achieved by enacting the Criminal Code (NT) in terms that did not limit rape to an offence outside marriage299. In the Australian Capital Territory and New South Wales, it was done by enacting that the fact of marriage was no bar to conviction for the offence300. In Victoria and South Australia, any presumption of spousal consent to sexual intercourse on marriage was, in terms, abolished301. South Australia was alone in providing a limited immunity for 298 The Acts Amendment (Sexual Assaults) Act 1985 (WA) repealed s 325 of the Criminal Code (WA) and introduced s 324D, which provided that "[a]ny person who sexually penetrates another person without the consent of that person is guilty of a crime". The Criminal Code Amendment (Sexual Offences) Act 1987 (Tas) substituted a new s 185(1) of the Criminal Code (Tas), providing that "[a]ny person who has sexual intercourse with another person without that person's consent is guilty of a crime". The Criminal Code, Evidence Act and other Acts Amendment Act 1989 (Q) repealed s 347 of the Criminal Code (Q) and substituted a provision defining rape as "carnal knowledge of a female without her consent". 299 Criminal Code Act 1983 (NT), incorporating the Criminal Code (NT), s 192(1). 300 The Crimes (Sexual Assault) Amendment Act 1981 (NSW) inserted s 61A(4) into the Crimes Act 1900 (NSW), which provided that the fact that a person is married to a person on whom an offence of sexual assault is alleged to have been committed is no bar to conviction for that offence. The Crimes (Amendment) Ordinance (No 5) 1985 (ACT) inserted s 92R into the Crimes Act 1900 (NSW), as it applied to the ACT, which provided that the fact that a person is married to a person upon whom an offence of sexual intercourse without consent contrary to s 92D is alleged to have been committed shall be no bar to the conviction of the first-mentioned person for the offence. 301 In Victoria, the Crimes (Amendment) Act 1985 (Vic) substituted for s 62(2) of the Crimes Act 1958 (Vic) a new sub-section providing that the existence of a marriage does not constitute, or raise any presumption of, consent by a person to a sexual penetration or indecent assault by another person. Bell husbands in the case of non-aggravated offences. Further amendments introduced into the CLC Act in 1992 removed this partial immunity302. In R v L, the validity of s 73(3) of the CLC Act was challenged on the ground of inconsistency with Commonwealth law. The claimed inconsistency was with s 114(2) of the Family Law Act 1975 (Cth), which conferred power on the Family Court of Australia to make an order relieving a party to a marriage from any obligation to perform marital services or to render conjugal rights. The Court held that there was no direct or indirect inconsistency between the State and Commonwealth laws303. Resolution of the issue presented in R v L did not require consideration of proof of the offence of rape under the common law. Among the submissions advanced on L's behalf was that s 114(2) of the Commonwealth statute preserved the common law inability of a wife to withhold her consent to sexual intercourse with her husband. In their joint reasons, Mason CJ, Deane and Toohey JJ said that, "if it was ever the common law that by marriage a wife gave irrevocable consent to sexual intercourse by her husband, it is no longer the common law"304. This statement was prominent in the respondent's submissions before the Full Court and on this appeal. The Full Court Doyle CJ, writing for the majority in the Full Court, answered the reserved question on the footing that it was likely that Hale's statement of the immunity would have been accepted as a correct statement of the common law of Australia in 1963305. Nonetheless, his Honour said the Full Court should apply the considered statement of this Court that any presumption of irrevocable consent to sexual intercourse no longer formed part of the common law306. His Honour encapsulated the operation of the declaratory theory of the common law in the following statement307: 302 Criminal Law Consolidation (Rape) Amendment Act 1992 (SA). 303 R v L (1991) 174 CLR 379 at 385. 304 R v L (1991) 174 CLR 379 at 390. 305 R v P, GA (2010) 109 SASR 1 at 13 [66]. 306 R v P, GA (2010) 109 SASR 1 at 4 [8], 17 [82]. 307 R v P, GA (2010) 109 SASR 1 at 4 [9]. Bell "Mr P is charged with offences against the then s 48 of the [CLC Act]. In 1963 the elements of that offence were determined by the common law. Today, those elements are determined by the common law as stated by the majority in R v L." Gray J dissented. His Honour considered that the majority in R v L had not declared the common law with respect to liability for rape308. He reviewed the history and concluded that the appellant could not have been convicted of the rape of GP in 1963309. His Honour would have answered the reserved question in the negative310. Developments in Scotland and England Before returning to the decision in R v L, reference should be made to judicial development of the law relating to the immunity in Scotland and England. In S v HM Advocate311, an accused was indicted in the High Court of Justiciary in Scotland for the rape of his wife, with whom he was cohabiting. He challenged the count, contending that no crime known to the law of Scotland had been committed. The motion was dismissed and the dismissal upheld on appeal. Lord Justice-General Emslie, giving the judgment of the Court, noted that there was no authority holding that a cohabiting husband could be convicted of the rape of his wife312. His Lordship considered the state of English law to be sufficiently summarised in Glanville Williams' Textbook of Criminal Law313: 308 R v P, GA (2010) 109 SASR 1 at 36 [146], 37 [148]. The reference to the majority in the context is to the joint reasons of Mason CJ, Deane and Toohey JJ and the 309 R v P, GA (2010) 109 SASR 1 at 29 [132]. 310 R v P, GA (2010) 109 SASR 1 at 45 [173]. 311 1989 SLT 469. 312 S v HM Advocate 1989 SLT 469 at 471. There had been cases in Scotland following Clarke (see fn 295 above) that allowed the conviction of a man for the rape of his wife where they were separated: HM Advocate v Duffy 1983 SLT 7; HM Advocate v Paxton 1985 SLT 96. 313 S v HM Advocate 1989 SLT 469 at 472, citing Williams, Textbook of Criminal Law, 2nd ed (1983) at 236. Bell "A husband is legally incapable of perpetrating rape upon his wife unless the parties are judicially separated, or (probably) separated by consent, or unless the court has issued an injunction forbidding the husband to interfere with his wife, or the husband has given an undertaking to the court in order to avoid the issue of the injunction." Lord Emslie referred with approval to Glanville Williams' views on the justification for the immunity314: "The reason traditionally given for the general rule is the totally unconvincing one that the wife's consent is given on marriage, and she cannot revoke it. It would be an understatement to say that this authentic example of male chauvinism fails to accord with current opinion as to the rights of husbands." The immunity in the law of Scotland was traced to the unequivocal statement of it by Baron Hume315, which, in turn, drew on Hale. The Court accepted that Hume's statement of the law may have been correct in the 18th and early 19th centuries. However, the application of the rule in the late 20th century depended on the reasons justifying it and it was said that irrevocable consent, "if it ever was a good reason, no longer applies today"316. In 1985, in R v Roberts, the Criminal Division of the Court of Appeal of England and Wales said317: "In our judgment the law is now quite plain on this topic [marital rape]. The status of marriage involves that the woman has given her consent to her husband having intercourse with her during the subsistence of the marriage. She cannot unilaterally withdraw it." 314 S v HM Advocate 1989 SLT 469 at 473-474, citing Williams, Textbook of Criminal Law, 2nd ed (1983) at 237. 315 S v HM Advocate 1989 SLT 469 at 472, citing Hume, Commentaries on the Law of Scotland Respecting Crimes, (1797), vol 1, and subsequent editions published in 1819 and 1829, and the fourth edition edited by Bell in 1844. Also cited were Burnett, Criminal Law of Scotland, (1811) and Macdonald, A Practical Treatise on the Criminal Law of Scotland, 5th ed (1948) at 119. 316 S v HM Advocate 1989 SLT 469 at 473. 317 [1986] Crim LR 188, (Transcript: Marten Walsh Cherer). Bell The decision in Roberts followed Steele318 and allowed that a husband might be convicted of the rape of his wife in circumstances in which he and she had, by mutual agreement or court order, effectively put an end to the wife's fictional consent. The enactment of s 1(1)(a) of the Sexual Offences (Amendment) Act 1976 (UK), which defined rape in terms incorporating the expression "unlawful sexual intercourse", led to conflicting decisions at the trial court level319 as to the ability to judicially develop further exceptions to the immunity. The perceived difficulty was occasioned by the recognition that the word "unlawful" in this context had always been understood to refer to sexual intercourse outside marriage320. The Court of Appeal addressed this controversy in R v R321. The accused had been convicted of the attempted rape of his wife committed on an occasion in 1989 when the two were living separately. The wife had informed the accused of her intention to petition for divorce but had not commenced proceedings before the date of the offence. Lord Lane CJ, giving the judgment of the Court, said322: "It seems to us that where the common law rule no longer even remotely represents what is the true position of a wife in present day society, the duty of the court is to take steps to alter the rule if it can legitimately do so in the light of any relevant Parliamentary enactment." It was held that the word "unlawful" in the definition was surplusage. "We take the view that the time has now arrived when the law should declare that a rapist remains a rapist subject to the criminal law, irrespective of his relationship with his victim." 318 (1976) 65 Cr App R 22. 319 R v R [1991] 1 All ER 747; R v C [1991] 1 All ER 755; R v J [1991] 1 All ER 759. 320 R v Chapman [1959] 1 QB 100 at 105. 321 R v R [1992] 1 AC 599. 322 R v R [1992] 1 AC 599 at 610. 323 R v R [1992] 1 AC 599 at 611. Bell The House of Lords affirmed the decision. Lord Keith of Kinkel (with whom the other members of the House agreed) observed324: "It may be taken that [Hale's dictum] was generally regarded as an accurate statement of the common law of England. The common law is, however, capable of evolving in the light of changing social, economic and cultural developments. Hale's proposition reflected the state of affairs in these respects at the time it was enunciated. Since then the status of women, and particularly of married women, has changed out of all recognition in various ways which are very familiar and upon which it is unnecessary to go into detail." The European Court of Human Rights dismissed an application in respect of the decision in R v R325, holding that the accused's conviction did not violate Art 7(1) of the European Convention on Human Rights326. The decision had continued a perceptible line of authority dismantling the immunity327 and the development of the law "had reached a stage where judicial recognition of the absence of immunity had become a reasonably foreseeable development of the law"328. The courts in S v HM Advocate and R v R declared the common law of Scotland, England and Wales, taking into account changes in the conditions of 324 R v R [1992] 1 AC 599 at 616. 325 SW v United Kingdom (1995) 21 EHRR 363. 326 Article 7 of the Convention for the Protection of Human Rights and Fundamental Freedoms (1950) provides: "1. No one shall be held guilty of any criminal offence on account of any act or omission which did not constitute a criminal offence under national or international law at the time when it was committed. Nor shall a heavier penalty be imposed than the one that was applicable at the time the criminal offence was committed. 2. This article shall not prejudice the trial and punishment of any person for any act or omission which, at the time when it was committed, was criminal according to the general principles of law recognised by civilised nations." 327 SW v United Kingdom (1995) 21 EHRR 363 at 402. 328 SW v United Kingdom (1995) 21 EHRR 363 at 402. Bell society. In this respect, Lord Keith adopted the following statement from S v HM Advocate329: "By the second half of the 20th century, however, the status of women, and the status of a married woman, in our law have changed quite dramatically." The decisions in S v HM Advocate and R v R necessarily operated with retrospective effect. In each case, the conduct giving rise to the charge was alleged to have occurred not long before the date of the decision. That was important to the reasoning of the European Court of Human Rights in dismissing the application in R v R. One issue raised by this appeal that was not present in S v HM Advocate or R v R concerns the imposition of criminal liability in consequence of developing the law to take account of changed social conditions, for conduct that may have occurred before those changes took place. Prospective overruling and R v L the The Attorneys-General for South Australia, Queensland and Commonwealth intervened to address a constitutional issue raised by the appellant's third ground of appeal. This ground asserts that, if the common law was capable of further development following the 1976 amendments to the CLC Act, it should only be developed on a prospective basis. The submission was argued by reference to the decision of the House of Lords in In re Spectrum Plus Ltd (in liquidation)330. It was said in that case that the flexibility inherent in the English legal system permits the prospective overruling of a previous decision in a case in which it would otherwise produce gravely unfair and disruptive consequences for past transactions or events331. However, it has been held that a constitutional limitation on the exercise of judicial power does not permit this Court flexibility of that kind332. In their joint reasons in R v L, Mason CJ, Deane and Toohey JJ discussed the content of conjugal rights in the law of marriage, rejecting the submission that the doctrine imposes a continuing obligation on the part of a spouse to 329 R v R [1992] 1 AC 599 at 617, citing S v HM Advocate 1989 SLT 469 at 473. 331 In re Spectrum Plus Ltd (in liquidation) [2005] 2 AC 680 at 699 [40] per Lord Nicholls of Birkenhead. 332 Ha v New South Wales (1997) 189 CLR 465 at 504 per Brennan CJ, McHugh, Gummow and Kirby JJ; [1997] HCA 34. Bell to sexual intercourse as a legal consequence of marriage333. consent Their Honours noted Lord Lane CJ's statement in R v R that "there can be little doubt that what [Hale] wrote was an accurate expression of the common law as it then stood"334. They went on to say335: "Without endeavouring to resolve the development of the common law in this regard, it is appropriate for this Court to reject the existence of such a rule as now part of the common law of Australia. … The notion is out of keeping also with recent changes in the criminal law of this country made by statute, which draw no distinction between a wife and other women in defining the offence of rape. It is unnecessary for the Court to do more than to say that, if it was ever the common law that by marriage a wife gave irrevocable consent to sexual intercourse by her husband, it is no longer the common law." (emphasis added; citations omitted) It was unnecessary for the Court to "resolve the development of the common law" because, as their Honours observed, the law had been changed by statute. There was no jurisdiction in Australia in which a presumption of spousal consent to sexual intercourse had any bearing on a person's liability for rape336. The answer to the question of law reserved by Herriman DCJ requires consideration of an issue that was not addressed by the joint reasons or the reasons of Dawson J in R v L, which is the liability under the common law of a cohabiting husband for the rape of his wife. Did the immunity form part of the received common law? The laws and statutes of England applicable to the Province of South Australia were received on 19 February 1836. The relevant history and principles are explained by Mason J in State Government Insurance Commission v Trigwell337. It is not in question that, if Hale's statement of the immunity was a 333 R v L (1991) 174 CLR 379 at 387. 334 R v L (1991) 174 CLR 379 at 389, citing R v R [1992] 1 AC 599 at 603-604. 335 R v L (1991) 174 CLR 379 at 389-390. 336 See above at [176]. 337 (1979) 142 CLR 617 at 634-635; [1979] HCA 40. As explained, s 3 of Act No 9 of 1872 (SA) re-enacted s 1 of Ordinance No 2 of 1843 (SA). Section 3 of the 1872 Act declared that: "In all questions as to the applicability of any laws or statutes of England to the Province of South Australia, the said Province shall be deemed to (Footnote continues on next page) Bell rule of the common law in 1836, it was part of the laws of England received in South Australia338. In light of the history leading to the enactment of s 73(3) and (5) of the CLC Act, there can be little doubt that the common law of Australia was understood as embodying a rule that a husband was not amenable to conviction for the rape of his wife. It is also evident that, by 1976, the justification for that immunity was not perceived to depend upon the concept of irrevocable consent that presumption while maintaining the immunity save for offences committed in circumstances of aggravation. the Parliament of South Australia abolished intercourse, since As will appear, the Parliament of South Australia was not alone in acting upon acceptance that a husband was immune under the common law for the rape of his wife. Nonetheless, it is said that, correctly understood, the common law has never conferred the immunity. This is because Hale did not cite any authority for it and there is no binding judicial decision confirming its existence339. These criticisms will be addressed in turn. have been established on the twenty-eighth day of December, one thousand eight hundred and thirty-six." A modified version of this declaration was enacted in s 48 of the Acts Interpretation Act 1915 (SA). That section was repealed by s 26 of the Acts Interpretation Act Amendment Act 1983 (SA), with the effect that the date of settlement of the Province of South Australia is now taken to be 19 February 1836, on which date letters patent were issued defining its borders. See Lipohar v The Queen (1999) 200 CLR 485 at 508 [54]; [1999] HCA 65, citing South Australia v Victoria (1911) 12 CLR 667 at 676-677; [1911] HCA 17. 338 See R v Brown (1975) 10 SASR 139 at 153; R v Wozniak and Pendry (1977) 16 SASR 67 at 71; Question of Law (No 1 of 1993) (1993) 59 SASR 214 at 230; Criminal Law and Penal Methods Reform Committee of South Australia, Special Report: Rape and Other Sexual Offences, (1976) at 13 [6.2]. 339 The only decision turning directly on the immunity appears to be R v Miller [1954] 2 QB 282. In that case, the accused was tried for the rape of his wife. The prosecution was brought after the decision in Clarke (see fn 295 above). The Crown relied on the evidence that the wife had been living separately at the time of the incident and had petitioned for divorce. Lynskey J held that the presentation of the petition for dissolution of the marriage did not have any effect in law upon the existing marriage and, accordingly, that the accused had no case to answer on the count charging rape: at 290. Bell An authoritative statement of the law of rape before Hale? It would be foolish to attempt to state the elements of liability for the offence of rape in the period before Hale. Holdsworth gives an account of the development of the offence in general terms, observing that Bracton would have confined the offence to violent intercourse with a virgin340. At the time of the writings attributed to Glanvill, rape was a plea of the Crown, which could be prosecuted by private appeal or on the presentation of the jury341. It appears that, in the early period, most prosecutions were by private appeal and that an appeal could be compromised by the marriage of the victim to her assailant342. There is evidence that, before the time of Hale, it was a good defence to an appeal of rape to say that the woman was one's concubine343. Holdsworth saw the essentials of the offence of rape as having been defined sometime after the Statute of Westminster II c 34, which made all rapes punishable as felonies344. The statute was passed in 1285 in the reign of Edward I. The only authority cited in Holdsworth for the statement of the essentials of the offence is Hale345. The explanation for this gap of some 400 340 Holdsworth, A History of English Law, 3rd ed (1923), vol 3 at 316, citing Bracton f 148. The most severe punishment, it seems, was reserved for the rape of a virgin, but elsewhere Bracton refers to punishment for the forcible ravishment of various categories of women: Thorne (ed), Bracton on the Laws and Customs of England, (1968), vol 2 at 414-415. 341 Hall (ed), The treatise on the laws and customs of the realm of England commonly called Glanvill, (1965) at 3, 175-176; Holdsworth, A History of English Law, 3rd ed (1923), vol 3 at 316. 342 Hall (ed), The treatise on the laws and customs of the realm of England commonly called Glanvill, (1965) at 176; Thorne (ed), Bracton on the Laws and Customs of England, (1968), vol 2 at 417-418; Blackstone, Commentaries on the Laws of England, (1769), bk 4, c 15 at 212; Holdsworth, A History of English Law, 3rd ed (1923), vol 3 at 316. 343 Thorne (ed), Bracton on the Laws and Customs of England, (1968), vol 2 at 416; Dalton, The Country Justice, (1690), c 160 at 392; Hawkins, A Treatise of the Pleas of the Crown, (1716), bk 1, c 41 at 108. 344 Holdsworth, A History of English Law, 3rd ed (1923), vol 3 at 316. The Statute of Westminster II c 34 and its predecessor, the Statute of Westminster I c 13, also dealing with the punishment for rape, were both repealed by the Offences against the Person Act 1828 (UK) (9 Geo 4 c 31). 345 Holdsworth, A History of English Law, 3rd ed (1923), vol 3 at 316. Bell years may lie in Professor Baker's account of the development of the criminal law. In the period up to the mid-16th century, the common law comprised the "common learning" found, not only in the yearbooks, but in the oral tradition of the Inns of Court346. It was the latter that shaped the criminal law. Few criminal cases were decided in the courts at Westminster and only a small number of criminal cases "trickled into the year books"347. Much of the record of the criminal law is found in the notes made by readers348 and these, it would seem, contain little discussion of rape349. Professor Baker says that the most visible result of the body of experience of the courts disposing of criminal cases is to be found in the treatises of Crompton, Dalton and Hale, all of whom drew heavily on rulings made at gaol deliveries350. It was their selection, rather than the rulings at large, which he suggests influenced the future development of the law351. The authority of the Pleas of the Crown Hale's statement was of a negative condition of liability for rape. This circumstance tends to explain the absence of prosecutions of husbands for the offence. Consideration of whether Hale's statement of the immunity came to acquire the status of a rule of law (if it was not one in 1736) requires some account of the standing of the Pleas of the Crown among common lawyers. Sir Matthew Hale held office as Chief Baron of the Exchequer and Chief Justice of the King's Bench successively in the years 1660 to 1676. He died in 1676, leaving instructions in his will prohibiting the publication of any work 346 Baker, The Oxford History of the Laws of England, (2003), vol 6 at 486. See also at 469: "[I]t was the settled learning of the inns of court, referred to in the 1490s as the 'old learning of the court', or the 'common learning in moots'. Common learning, by its nature, did not require chapter and verse to support it. It was what the whole system of exercises was implicitly calculated to transmit, to test, and to teach" (citations omitted). 347 Baker, The Oxford History of the Laws of England, (2003), vol 6 at 471. 348 Baker, The Oxford History of the Laws of England, (2003), vol 6 at 529. 349 Baker, The Oxford History of the Laws of England, (2003), vol 6 at 562. In fn 92, Baker notes that the Statute of Westminster II c 34 was glossed "very briefly". 350 Baker, "The Refinement of English Criminal Jurisprudence, 1500-1848", in The Legal Profession and the Common Law: Historical Essays, (1986) 303 at 313. 351 Baker, "The Refinement of English Criminal Jurisprudence, 1500-1848", in The Legal Profession and the Common Law: Historical Essays, (1986) 303 at 313. Bell other than that which he had permitted to be published in his lifetime. At the time of his death, he was writing the Pleas of the Crown, which he had planned as a work in three volumes352. Only the first volume was completed. Four years after his death, the House of Commons ordered that it be printed. However, it was not until 1736 that the first edition appeared under the editorship of Sollom Emlyn, barrister of Lincoln's Inn. Sir William Blackstone acknowledged his debt to Hale353 and drew on the Pleas of the Crown in his account of felonies in the Commentaries. Sir James Fitzjames Stephen accorded the composition of the Pleas of the Crown an important place in the evolution of the criminal law in the 17th century354. It was, in his estimate, a work "of the highest authority", demonstrating both "a depth of thought and a comprehensiveness of design" that put it in "quite a different category" from Coke's Institutes355. Important principles of criminal responsibility were hardly noticed before Hale356. Stephen saw the definition of many crimes as settled in the period that separates Coke from Blackstone, and Hale and Foster as having contributed more than any other writers to that development357. Maitland said of Hale that "none had a wider or deeper knowledge of the materials; he was perhaps the last great English lawyer who habitually studied records; he studied them pen in hand and to good purpose". He was, in Maitland's estimate, "the most eminent lawyer and judge of his time"358. Holdsworth accounted Hale "the greatest historian of English law before 352 Yale, Hale as a Legal Historian, (1976) at 8; Holdsworth, "Sir Matthew Hale", (1923) 39 Law Quarterly Review 402 at 419. The second volume was intended to deal with non-capital crimes and the third with franchises and liberties. 353 Blackstone, An Analysis of the Laws of England, 3rd ed (1758) at vii. 354 Stephen, A History of the Criminal Law of England, (1883), vol 2 at 211. 355 Stephen, A History of the Criminal Law of England, (1883), vol 2 at 211. Stephen was not uncritical in his treatment of the Pleas of the Crown. He described the weight of technical detail in the chapters dealing with procedure as almost unreadable except by a very determined student: at 212. 356 Stephen, A History of the Criminal Law of England, (1883), vol 2 at 212. 357 Stephen, A History of the Criminal Law of England, (1883), vol 2 at 219. 358 Maitland, "The Materials for English Legal History", in Fisher (ed), The Collected Papers of Frederic William Maitland, (1911), vol 2, 1 at 5. Bell Maitland"359. He considered the Pleas of the Crown to have been left in the best state of any of Hale's works that had not been published at the date of his death360. Holdsworth, like Stephen, regarded the treatise highly361: "It was a branch of the law which could not then be adequately described without a very complete knowledge of the history of the law; and, partly because it contained very ancient ideas and rules, partly because it had been added to and in many details modified by a variety of statutes, it greatly needed systematic Coke and Crompton had summarized it, in a somewhat unsystematic form. Hale, because he was both a competent historian, a competent jurist, and a competent lawyer did the work which they endeavoured to do infinitely better. Ever since its first publication it has been a book of the highest authority." (citations omitted) treatment. Holdsworth saw Coke as standing midway between the medieval and the modern law, and Hale as "the first of our great modern common lawyers"362. The analysis of the offence in the Pleas of the Crown Hale described the offence of rape as "the carnal knowledge of any woman above the age of ten years against her will, and of a woman-child under the age of ten years with or against her will"363. Hale acknowledged Coke for this statement364, but proceeded to a much more detailed analysis of proof of the offence. He discussed additional elements (any degree of penetration was sufficient and it was not necessary to prove emission of semen); accessorial liability for the offence; liability in the case of infants under 14 years; liability in the case of consenting females under 12 years; and consent obtained by threat of 359 Holdsworth, "Sir Matthew Hale", (1923) 39 Law Quarterly Review 402 at 402. 360 (1923) 39 Law Quarterly Review 402 at 419-420. 361 (1923) 39 Law Quarterly Review 402 at 420. 362 (1923) 39 Law Quarterly Review 402 at 425. 363 Hale, The History of the Pleas of the Crown, (1736), vol 1, c 58 at 628. 364 Hale, The History of the Pleas of the Crown, (1736), vol 1, c 58 at 628. The fourth edition of the Third Part of Coke's Institutes, published in 1669, in fact described the offence of rape as "the unlawfull and carnal knowledge and abuse of any woman above the age of ten years against her will, or of a woman-child under the age of ten years with her will, or against her will" (emphasis added): The Third Part of the Institutes of the Laws of England, 4th ed (1669), c 11 at 60. Bell violence, among other matters. He also gave a deal of attention to the older law concerning appeals of rape, including the concubinage exception365. The account of the husband's immunity follows discussion of the latter. The relevant passage is set out below366: "It appears by Bracton ubi supra, that in an appeal of rape it was a good exception, quod ante diem & annum contentas in appello habuit eam ut concubinam & amicam, & inde ponit se super patriam, and the reason was, because that unlawful cohabitation carried a presumption in law, that it was not against her will. But this is no exception at this day, it may be an evidence of an assent, but it is not necessary that it should be so, for the woman may forsake that unlawful course of life. But the husband cannot be guilty of a rape committed by himself upon his lawful wife, for by their mutual matrimonial consent and contract the wife hath given up herself in this kind unto her husband, which she cannot retract." Writing of the criticism that Hale had conjured up the immunity without authority, one commentator has observed that it might be thought incongruous that the law allowed an exception in the case of de facto relationships (for which there is clear evidence before Hale's time) but not de jure relationships367. The writer suggests that Hale lacked authority, not for the existence of the immunity, but for confining it to marriage368. It should be noticed that Hale said the concubinage exception was no longer good law because of the recognition that a 365 Hale, The History of the Pleas of the Crown, (1736), vol 1, c 58 at 628. 366 Hale, The History of the Pleas of the Crown, (1736), vol 1, c 58 at 628-629. 367 Lanham, "Hale, Misogyny and Rape", (1983) 7 Criminal Law Journal 148 at 154, citing Dalton, Countrey Justice, (1619) at 256; R v Lord Audley (1631) 3 St Tr 401 368 Lanham, "Hale, Misogyny and Rape", (1983) 7 Criminal Law Journal 148 at 155. Professor Lanham identifies two extra-judicial supports for the existence of the immunity in Hale's time. Hale referred to Isabel Butler v William Pull, introducing the case by explaining that if A forces B to marry him and then has carnal knowledge of her against her will, he cannot be found guilty of rape during the subsistence of the voidable marriage; and Statute 6 R 2 stat 1 c 6, giving a husband a right of appeal where his wife had consented to a rape by a third party after the fact. Bell woman may forsake her unlawful way of life. This was stated by way of contrast to sexual intercourse within marriage, which was seen as lawful369. Hale had a commanding knowledge of the work of the courts administering criminal justice370. It may safely be taken that husbands were not prosecuted for rape of their wives in the period before the publication of his treatise. Given the subordinate status of married women under the law, this may not surprise371. Among the few benefits that the law conferred on the married woman was to immunise her from prosecution for a crime committed by her in her husband's presence372. The presumption of the law was that she was bound to obey her husband's command. This is not an idea that readily accommodates the prosecution of the husband for an act of non-consensual sexual intercourse with his wife. Hale is the source for locating the immunity in contract. It is a rationale that is consistent with Blackstone's treatment of the relations between husband and wife at law. The latter's celebrated account of the nature and effect of 369 See extract from Coke at fn 364 above. Similarly, Hawkins, A Treatise of the Pleas of the Crown, (1716), bk 1, c 41 at 108 described rape, relevantly, as an offence "in having unlawful and carnal Knowledge of a Woman" (emphasis added). 370 See Yale, Hale as a Legal Historian, (1976) for an account of Hale's record-searching and collecting from 1630, and his extensive knowledge of King's 371 Williams, "The Legal Unity of Husband and Wife", (1947) 10 Modern Law Review 16 at 29; Easteal, "Rape in marriage: Has the licence lapsed?", in Easteal (ed), Balancing the Scales: Rape, Law Reform and Australian Culture, (1998) 107 at 372 Hawkins, A Treatise of the Pleas of the Crown, (1716), bk 1, c 1 at 2; Hale, The History of the Pleas of the Crown, (1736), vol 1, c 7 at 44-48; Blackstone, Commentaries on the Laws of England, (1769), bk 4, c 2 at 29; J W C Turner, Russell on Crime, 12th ed (1964), vol 1 at 94-95. The presumption did not extend to treason or murder: Hale, The History of the Pleas of the Crown, (1736), vol 1, c 7 at 45. It has been abolished in all Australian jurisdictions: Crimes Act 1900 (NSW), Sched 3, cl 4(1) (originally s 407A(1)); Criminal Code (Q), s 32 (omitted in 1997); CLC Act, s 328A; Criminal Code (Tas), s 20(2); Crimes Act 1958 (Vic), s 336(1); Criminal Code (WA), s 32 (omitted in 2003); Crimes Act 1900 (ACT), s 289. It is not included in the defence of duress in the Criminal Code (NT), s 40. However, an affirmative defence of marital coercion has been retained in South Australia and Victoria: CLC Act, s 328A; Crimes Act 1958 (Vic), s 336. Bell coverture373 was prefaced by the statement: "[o]ur law considers marriage in no other light than as a civil contract"374. While "[t]he holiness of the matrimonial state" (emphasis in original) was a matter for the ecclesiastical courts, Blackstone emphasised that the temporal courts treated marriage like all other contracts, asking whether the parties were willing and able to contract375. It is an analysis which has been seen as a civilised advance on the medieval concept of the husband's natural and God-given power over his wife376. Professor Stretton suggests that, for Blackstone, the fundamental point was that married women consented to their modified legal status by their agreement to marriage377: "It was therefore the logic of contract that justified married women's particular treatment at law. However, it was a narrow concept of consent that ended abruptly at the church door, with no room for renegotiation during marriage and virtually no effective ability to escape the legal effects of marriage through separation or divorce." Blackstone's treatment of rape was largely taken from Hale378. He did not refer to the immunity, but it is evident that Hale's statement of it was not controversial. Blackstone drew attention to those occasions on which Hale's account of the law departed from the views of other writers. In Blackstone's analysis of the offence of rape, there was one such occasion. He noted that Hale considered that carnal knowledge of a girl aged under 12 years was rape regardless of consent, but that the law had in general been held only to extend to the carnal knowledge of a girl aged under 10 years379. 373 "By marriage, the husband and wife are one person in law: that is, the very being or legal existence of the woman is suspended during the marriage, or at least is incorporated and consolidated into that of the husband: under whose wing, protection, and cover, she performs every thing": Commentaries on the Laws of England, (1765), bk 1, c 15 at 430 (emphasis in original). 374 Blackstone, Commentaries on the Laws of England, (1765), bk 1, c 15 at 421. 375 Blackstone, Commentaries on the Laws of England, (1765), bk 1, c 15 at 421. 376 Stretton, "Coverture and Unity of Person in Blackstone's Commentaries", in Prest (ed), Blackstone and his Commentaries, (2009) 111 at 120-121. 377 Stretton, "Coverture and Unity of Person in Blackstone's Commentaries", in Prest (ed), Blackstone and his Commentaries, (2009) 111 at 123, citing Commentaries on the Laws of England, (1765), bk 1, c 15 at 421. 378 Blackstone, Commentaries on the Laws of England, (1769), bk 4, c 15 at 211-215. 379 Blackstone, Commentaries on the Laws of England, (1769), bk 4, c 15 at 212. Bell The operation of the immunity Hale's statement of the law may be analysed in either of two ways. First, that the offence comprises two elements: (i) carnal knowledge of a female (involving some degree of penetration); (ii) without her consent. On this analysis the immunity arises by the operation of an irrebuttable presumption of law. The alternative analysis is that the first element of the offence requires proof of the "unlawful" carnal knowledge of a female and that "unlawful" in this context means outside marriage380. The latter view accords with the treatment of the offence by text-writers, including Coke and Hawkins writing before the publication of Hale's treatise381. It is the analysis adopted by the Supreme Court of South Australia in those cases in which consideration has been given to the question. Bray CJ, discussing the elements of the offence in R v Brown382, considered that they were as stated in the 37th edition of Archbold: "Rape consists in having unlawful sexual intercourse with a woman without her consent by force, fear or fraud"383. The word "unlawful" was thought by Bray CJ to exclude intercourse between spouses384. Wells J appears to have been of the same view385. King CJ in R v Sherrin (No 2) also considered proof of the unlawfulness of the act of intercourse to have undoubtedly been an element of the offence at common law386. The resolution of the reserved question does not turn on whether the rule of law traced to Hale requires proof of the unlawfulness of the intercourse as an element, or is an irrebuttable presumption of consent. The latter, while "disguised in the language of adjective rules"387, is in truth a substantive rule of 380 R v Chapman [1959] 1 QB 100. 381 See fnn 364 and 369 above. 382 (1975) 10 SASR 139. 383 Butler and Garsia, Archbold: Pleading, Evidence & Practice in Criminal Cases, 37th ed (1969) at [2872], citing East, A Treatise of the Pleas of the Crown, (1803), vol 1 at 434 and Hale, The History of the Pleas of the Crown, (1736), vol 1 at 627 et seq (emphasis added). 384 R v Brown (1975) 10 SASR 139 at 141. 385 R v Brown (1975) 10 SASR 139 at 153. 386 (1979) 21 SASR 250 at 252. 387 J W C Turner, Kenny's Outlines of Criminal Law, 19th ed (1966) at 455 [490]. Bell law. A husband could not be convicted as principal in the first degree for the rape of his wife on either analysis. At issue is the existence of the immunity, not whether the reason given for it is flawed or has, over time, ceased to provide a principled basis for it. A number of common law rules of liability for criminal offences have their origins in discredited ideas. The definition of the offence of murder stated by Coke388, and thereafter accepted as an authoritative statement of the elements of the offence389, required that the death of the deceased take place within a year and a day of the act causing death. The reason for the rule is suggested to be the limitations of medieval medical knowledge390. If that is the reason, it must be said that the rule survived long after its justification ceased. The rule has since been abolished by statute391. In the same category is the presumption that a boy under 14 years of age is physically incapable of sexual intercourse. This, too, is traced to the statement of the law in the Pleas of the Crown392. The presumption is patently absurd. Nonetheless, it was accepted as a rule of law precluding the 388 Coke, The Third Part of the Institutes of the Laws of England, 4th ed (1669), c 7 at 389 Hawkins, A Treatise of the Pleas of the Crown, (1716), bk 1, c 31 at 79; Hale, The History of the Pleas of the Crown, (1736), vol 1, c 33 at 426; Blackstone, Commentaries on the Laws of England, (1769), bk 4, c 14 at 197-198; East, A Treatise of the Pleas of the Crown, (1803), vol 1 at 214, 343; Halsbury's Laws of England, 2nd ed, vol 9 at 428. See also R v Dyson [1908] 2 KB 454; R v Evans & Gardiner (No 2) [1976] VR 523. 390 Coke, The Third Part of the Institutes of the Laws of England, 4th ed (1669), c 7 at 53. See also Rogers v Tennessee 532 US 451 at 463 (2001); Fisse (ed), Howard's Criminal Law, 5th ed (1990) at 31; Waller and Williams, Criminal Law, 11th ed 391 Crimes Act 1900 (NSW), s 17A; CLC Act, s 18; Crimes Act 1958 (Vic), s 9AA; Crimes Act 1900 (ACT), s 11. The rule has been removed in the Code States: Penalties and Sentences Act 1992 (Q) (as enacted), s 207, Schedule, item 7 under the heading "Criminal Code"; Criminal Code Amendment (Year and a Day Rule Repeal) Act 1993 (Tas); Criminal Law Amendment Act 1991 (WA), s 6. It never formed part of the Criminal Code (NT). 392 Hale, The History of the Pleas of the Crown, (1736), vol 1, c 58 at 630 (mispaginated in the original as 730): "An infant under the age of fourteen years is presumed by law unable to commit a rape, and therefore it seems cannot be guilty of it, and tho in other felonies malitia supplet aetatem in some cases as hath been shewn, yet it seems as to this fact the law presumes him impotent, as well as wanting discretion." Bell conviction of boys for rape393 until it was abolished by statute394. It was sufficient for Lord Coleridge CJ in R v Waite to observe that the rule had been "clearly laid down by Lord Hale" and, on that authority, judges had "refused to receive evidence to shew that a particular prisoner was in fact capable of committing the offence"395. Hale's statement of the immunity was taken as an authoritative statement of the law by all the leading text-writers396. 393 See, eg, R v Eldershaw (1828) 3 Car & P 396 [172 ER 472]; R v Waite [1892] 2 QB 600; R v Williams [1893] 1 QB 320. See also Blackstone, Commentaries on the Laws of England, (1769), bk 4, c 15 at 212; Roscoe, A Digest of the Law of Evidence in Criminal Cases, 2nd ed (1840) at 797; Williams, Criminal Law: The General Part, 2nd ed (1961) at 821. 394 Crimes Act 1900 (NSW), s 61S (originally s 61A(2)); CLC Act, s 73(2); Crimes Act 1958 (Vic), s 62(1); Crimes Act 1900 (ACT), s 68; Sexual Offences Act 1993 (UK), s 1. The presumption has been removed in the Code States: Criminal Code, Evidence Act and other Acts Amendment Act 1989 (Q), s 9; Criminal Code Amendment (Sexual Offences) Act 1987 (Tas), s 5; Acts Amendment (Sexual Assaults) Act 1985 (WA), s 4. It never formed part of the Criminal Code (NT). 395 R v Waite [1892] 2 QB 600 at 601. See also R v Young [1923] SASR 35; R v Packer [1932] VLR 225. 396 East, A Treatise of the Pleas of the Crown, (1803), vol 1 at 446; Burnett, A Treatise on Various Branches of the Criminal Law of Scotland, (1811) at 102; Chitty, A Practical Treatise on the Criminal Law, (1816), vol 3 at 811; Russell, A Treatise on Crimes and Misdemeanors, (1819), vol 1, bk 3, c 6 at 802; Archbold, A Summary of the Law Relative to Pleading and Evidence in Criminal Cases, (1822) at 259; Alison, Principles of the Criminal Law of Scotland, (1832) at 215; Roscoe, A Digest of the Law of Evidence in Criminal Cases, (1835) at 708; Hume, Commentaries on the Law of Scotland, Respecting Crimes, (1844), vol 1, c 7 at 306; Macdonald, A Practical Treatise on the Criminal Law of Scotland, (1867) at 194; Stephen, A Digest of the Criminal Law (Crimes and Punishments), 4th ed (1887), c 29 at 194; Halsbury, The Laws of England, 1st ed, vol 9, par 1236; Sturge, Stephen's Digest of the Criminal Law (Indictable Offences), 9th ed (1950) at 263; Halsbury's Laws of England, 3rd ed, vol 10, par 1437; Butler and Garsia, Archbold: Pleading, Evidence & Practice in Criminal Cases, 35th ed (1962) at 1150; J W C Turner, Russell on Crime, 12th ed (1964), vol 1 at 708; Howard, Australian Criminal Law, (1965) at 135, 145-147. Bell R v Clarence The first judicial consideration of the immunity was in R v Clarence397. A bench of 13 judges was constituted to consider the question of whether the transmission of gonorrhoea by husband to wife in an act of consensual sexual intercourse could amount to the malicious infliction of grievous bodily harm. Wills, Field and Hawkins JJ each left open that circumstances may exist in which a husband could be liable for the rape of his wife. Wills J doubted that "between married persons rape is impossible"398. Field J thought that there may be cases in which a husband could be convicted of a crime arising out of forcibly imposing sexual intercourse on his wife; he did not say whether for rape or some other offence399. Hawkins J accepted that, by the marriage contract, a wife confers on her husband "an irrevocable privilege to have sexual intercourse with her during such time as the ordinary relations created by such contract subsist between them" and that a husband could not be convicted of a rape committed by him upon the person of his wife400. However, a husband was not at liberty to endanger his wife's health and cause her grievous bodily harm by the exercise of "the marital privilege" at a time when he was suffering from venereal disease and when the natural consequence of sexual intercourse would be the communication of that disease to her401. He explained the principles in this way402: "Rape consists in a man having sexual intercourse with a woman without her consent, and the marital privilege being equivalent to consent given once for all at the time of marriage, it follows that the mere act of sexual communion is lawful; but there is a wide difference between a simple act of communion which is lawful, and an act of communion combined with infectious contagion endangering health and causing harm, which is unlawful. … The wife submits to her husband's embraces because at the time of marriage she gave him an irrevocable right to her person. The intercourse which takes place between husband and wife after marriage is not by virtue of any special consent on her part, but is mere submission to an 397 (1888) 22 QBD 23. 398 R v Clarence (1888) 22 QBD 23 at 33. 399 R v Clarence (1888) 22 QBD 23 at 57. 400 R v Clarence (1888) 22 QBD 23 at 51. 401 R v Clarence (1888) 22 QBD 23 at 51. 402 R v Clarence (1888) 22 QBD 23 at 51, 54. Bell obligation imposed upon her by law. Consent is immaterial." (emphasis in original) Pollock B said403: "The husband's connection with his wife is not only lawful, but it is in accordance with the ordinary condition of married life. It is done in pursuance of the marital contract and of the status which was created by marriage, and the wife as to the connection itself is in a different position from any other woman, for she has no right or power to refuse her consent." Consideration of the immunity in Clarence appears to have been prompted by a submission based on a footnote in Stephen's Digest of the Criminal Law. The law in the first edition of the Digest was stated, relevantly, in this way404: "Rape is the act of having carnal knowledge of a woman without her conscious permission ... Provided that: – (1) A husband [it is said] cannot commit rape upon his wife by carnally knowing her himself, but he may do so if he aids another person to have carnal knowledge of her." The footnote relevantly said405: "Hale's reason is that the wife's consent at marriage is irrevocable. Surely, however, the consent is confined to the decent and proper use of marital rights. If a man used violence to his wife under circumstances in which decency or her own health or safety required or justified her in refusing her consent, I think he might be convicted of rape, notwithstanding Lord Hale's dictum. He gives no authority for it, but makes the remark only by way of introduction to the qualification contained in the latter part of clause (1), for which Lord Castlehaven's Case (3 St Tr 402) is an authority." 403 R v Clarence (1888) 22 QBD 23 at 63-64. 404 Stephen, A Digest of the Criminal Law (Crimes and Punishments), (1877), c 29 at 405 Stephen, A Digest of the Criminal Law (Crimes and Punishments), (1877), c 29 at Bell Stephen J gave the leading judgment in Clarence406. He used the occasion to draw attention to the alteration of the footnote, removing the suggestion that a man might in certain circumstances be indicted for the rape of his wife, in the most recent edition of his text407. Stephen was a great master of the criminal law408. An account of his draft criminal code and the subsequent Commission appointed to report upon it is contained in the joint reasons in Darkan v The Queen409. To the extent that the Draft Code appended to the Report of the Commissioners differed from Stephen's original draft, the differences were noted in the Report. The provisions dealing with offences against the person were said to correspond (as did the provisions in Stephen's original draft) with the Offences against the Person Act 1861 (UK)410, "supplemented by a reduction to writing of the common law doctrines and definitions"411. The Offences against the Person Act 1861 (UK) prescribed the punishment for rape but left the definition of the offence to the common law. It is apparent that the definition of rape in the Draft Code was understood by its authors412 to be a statement of the common law. Relevantly, the offence was defined as "the act of a man having carnal knowledge without her consent of a female who is not his wife"413. The Criminal Code Indictable Offences Bill 1878 (UK), on which the Commissioners' draft was based, and which defined rape in the same terms, had been circulated to the Judges, Chairmen and Deputy Chairmen of Quarter Sessions, Recorders and "many members of the bar and 406 A L Smith, Mathew and Grantham JJ, Huddleston B and Lord Coleridge CJ concurred. 407 R v Clarence (1888) 22 QBD 23 at 46. See Stephen, A Digest of the Criminal Law (Crimes and Punishments), 4th ed (1887), c 29 at 194 fn 4. 408 Radzinowicz, Sir James Fitzjames Stephen, 1829-1894, Selden Society Lecture, 409 (2006) 227 CLR 373 at 385-386 [33]-[36]; [2006] HCA 34. 410 24 & 25 Vict c 100, s 48. 411 Criminal Code Bill Commission, Report of the Royal Commission Appointed to Consider The Law Relating to Indictable Offences, (1879) [C 2345] at 22. 412 Lord Blackburn, Mr Justice Barry, Lord-Justice Lush and Sir James Fitzjames Stephen. 413 Section 207 of the Draft Code, Appendix to the Criminal Code Bill Commission, Report of the Royal Commission Appointed to Consider The Law Relating to Indictable Offences, (1879) [C 2345] at 107. Bell other gentlemen having practical experience in the administration of the criminal law"414 in England and Ireland with the invitation to comment on it. The absence of any suggestion in the Commissioners' Report that the offence of rape was to be modified under the Code is eloquent of the acceptance by those engaged in the administration of the criminal law in England and Ireland at the time that the offence could not be committed by a husband against his wife415. Sir Samuel Griffith drew on the English Draft Code in preparing his draft criminal code for Queensland416. In the latter, the offence of rape was defined, relevantly, as the "carnal knowledge of a woman, not his wife"417. The marginal notes reveal that Sir Samuel Griffith considered this definition to be a statement of the common law. In Canada, before the enactment of the Criminal Code in 1892, the offence of rape, while punishable as a felony under legislation modelled on the Offences against the Person Act 1861 (UK), depended upon the common law for its elements of proof. It is apparent that the understanding in that jurisdiction was that the offence could not be committed by a husband against his wife418. The Criminal Code defined rape as involving the "carnal knowledge of a woman who is not his wife"419. It does not appear that this was thought to involve any departure from the existing law. The absence of binding decision The absence of a binding decision does not mean that a rule stated in authoritative texts and accepted and acted upon by the legal profession over many years may not acquire status as law. The point is made by Sir John Smith 414 Criminal Code Bill Commission, Report of the Royal Commission Appointed to Consider The Law Relating to Indictable Offences, (1879) [C 2345] at 5. 415 See Criminal Code Bill Commission, Report of the Royal Commission Appointed to Consider The Law Relating to Indictable Offences, (1879) [C 2345] at 25. 416 Griffith, Draft of a Code of Criminal Law, (1897) at iv. 417 Griffith, Draft of a Code of Criminal Law, (1897), s 353 at 135. 418 Taschereau, The Criminal Statute Law of the Dominion of Canada, 2nd ed (1888) 419 Criminal Code 1892 (Can), s 266. Bell in his commentary on R v C420, by reference to Foakes v Beer421. In the latter case, the House of Lords held itself bound to follow a rule stated by Coke to have been laid down in Pinnel's Case422 in 1602, although their Lordships disliked it and there was no decision in which it had been applied. As the Earl of Selborne LC put it423: "The doctrine itself, as laid down by Sir Edward Coke, may have been criticised, as questionable in principle, by some persons whose opinions are entitled to respect, but it has never been judicially overruled; on the contrary I think it has always, since the sixteenth century, been accepted as law. If so, I cannot think that your Lordships would do right, if you were now to reverse, as erroneous, a judgment of the Court of Appeal, proceeding upon a doctrine which has been accepted as part of the law of England for 280 years." Brennan J, the only Justice in R v L to consider proof of the offence of rape under the common law, considered the elements to have been fixed by Hale's statement of them424. The evidence in favour of that conclusion is compelling. Has the immunity ceased to exist? It was submitted that legal and social changes to the status of married women had produced the result that the immunity had ceased to be a rule of law on a date before the subject events. There were differing views about when that change to the law occurred, a circumstance which tends to highlight a difficulty with accepting the underlying premise. The respondent and the Attorney- General for South Australia contended that the foundation for the immunity had "crumbled to dust" as at the "early to mid twentieth century". The Attorney- General of circumstances had occurred "by the end of the 19th century". Reference was made to the enactment of the Married Women's Property Acts; the amendment of matrimonial causes statutes removing the "double-standard" relating to adultery as a ground for dissolution of marriage; and, more generally, the extension of the the Commonwealth contended the relevant change that 420 [1991] Crim LR 62. 421 (1884) 9 App Cas 605. 422 (1602) 5 Co Rep 117a [77 ER 237]. 423 Foakes v Beer (1884) 9 App Cas 605 at 612. See also at 622-623 per Lord Blackburn, 623-624 per Lord Watson, 629-630 per Lord FitzGerald. 424 R v L (1991) 174 CLR 379 at 399. Bell franchise to women, as combining to produce a state of affairs that was inconsistent with the continued existence of the immunity. These submissions were maintained in the face of a good deal of evidence to the contrary. The one case relied on to support the submissions was R v Jackson425. In that case, Lord Halsbury LC rejected the proposition that the relation of husband and wife gave the husband "complete dominion over the wife's person"426. The holding that an order for restitution of conjugal rights did not confer on the husband a right to imprison his wife is a tenuous basis for concluding that the husband was now amenable to prosecution for having sexual intercourse with his wife without her consent. In the first edition of Halsbury, published in 1909, almost 20 years after the decision in Jackson, the law was stated as being that "[a] man cannot be guilty as a principal in the first degree of a rape upon his wife, for the wife is unable to retract the consent to cohabitation which is a part of the contract of In Tasmania, the Married Women's Property Act was enacted in 1882. Women had been granted the franchise for both federal and State parliamentary elections by 1904428. The Matrimonial Causes Act 1860 (Tas) was amended in 1919 to remove the double-standard with respect to adultery429. Nonetheless, when the Parliament enacted the Criminal Code for Tasmania in 1924, a quarter of a century after the enactment of the Queensland Criminal Code, the crime of 426 [1891] 1 QB 671 at 679. 427 Halsbury, The Laws of England, 1st ed, vol 9, par 1236. The second edition, under the editorship of Viscount Hailsham, published in 1933, stated the law in the same terms: vol 9, par 815. It was not until after Clarke (see fn 295 above), which provided a limited exception to the immunity in the case of a wife living separately under the protection of a court order, that the third edition, under the editorship of Viscount Simons, published in 1955, stated the rule in qualified terms: "[a] man cannot, as a general rule, be guilty as a principal in the first degree of a rape upon his wife" (vol 10, par 1437). 428 Commonwealth Franchise Act 1902 (Cth); Constitution Amendment Act 1903 (Tas). 429 Matrimonial Causes Amendment Act 1919 (Tas) (Royal Assent proclaimed on 17 May 1920). Bell rape was defined in the same way as under the latter430. The significant changes in the legal status of married women which had occurred by 1924 do not appear to have been viewed at the time as inconsistent with the immunity. In the same year, the House of Lords delivered judgment in G v G431. That was an appeal from the dismissal of an application for a decree of nullity of marriage brought by a husband on the ground of his wife's impotency. The appellant and his wife were married in 1913 and the evidence of their relations spanned the period from that date to 1921. The wife had evinced an hysterical reluctance to engage in sexual intercourse. The question for the court was whether this psychological obstacle to consummation amounted to incapacity, as distinct from the mere wilful refusal of conjugal rights. The court below had doubted that the husband's repeated attempts at intercourse had exhibited "a sufficient virility"432. It was in this context that Lord Dunedin observed433: "It is indeed permissible to wish that some gentle violence had been employed; if there had been it would either have resulted in success or would have precipitated a crisis so decided as to have made our task a comparatively easy one." His Lordship considered the husband's account "as to why he did not use a little more force than he did" to have been an acceptable explanation434 and the appeal was allowed. The speeches in G v G speak to another age. The decision in that case is closer to the date of the acts charged against the appellant than was the hearing of this appeal. More than a decade after the events giving rise to this appeal, in 1975, Lawton LJ, giving the judgment of the English Court of Appeal in R v Cogan, proceeded upon acceptance that it was a legal impossibility for a man to rape his wife during cohabitation435. The accused bore accessorial liability for the rape of his wife by another. In the following year, Geoffrey Lane LJ extended the exception to the immunity to allow the conviction of a husband for the rape of his 430 Criminal Code (Tas), s 185 (as enacted). Relevantly, rape was defined as involving "carnal knowledge of a female not his wife". 432 G v G [1924] AC 349 at 357. 433 G v G [1924] AC 349 at 357. 434 G v G [1924] AC 349 at 358. 435 R v Cogan [1976] QB 217 at 223. Bell wife where he had given an undertaking not to molest her436. Of present significance is his Lordship's view that, "[a]s a general principle, there is no doubt that a husband cannot be guilty of rape upon his wife"437. The undertaking given in lieu of an injunction operated in that case to eliminate the wife's matrimonial consent to intercourse. A convenient account of the law in England as it was understood in December 1983 is contained in the Report of the Criminal Law Revision Committee, which had been asked to review the law relating to, and penalties for, sexual offences438: "In defining rape the Sexual Offences (Amendment) Act 1976 uses the term 'unlawful sexual intercourse'. What is 'unlawful' is left to the common law. The general rule is that sexual intercourse is 'unlawful' if it occurs outside marriage. Sexual intercourse between husband and wife is not 'unlawful' except in a fairly narrow class of cases, which can be broadly described as cases where the parties have separated and their separation has been acknowledged by a court." The existence of the immunity was also accepted in decisions of Australian courts delivered after 1963. Reference has been made earlier in these reasons to decisions of the South Australian Supreme Court439. In New South Wales, Victoria and Tasmania, the English line of authority allowing an exception to the immunity in the case of a wife living separately and under the protection of a court order was adopted440. In R v McMinn, Starke ACJ observed441: "There can be no doubt that for centuries the law in England (and in Australia) has been that a man cannot rape his wife. That this principle of law is out of tune with modern thinking has been recognized in Victoria 436 Steele (1976) 65 Cr App R 22. 437 Steele (1976) 65 Cr App R 22 at 24. 438 Criminal Law Revision Committee, Sexual Offences, Report No 15, (1984) Cmnd 9213 at 17-18 [2.57]. 439 See above at [212]. 440 C (1981) 3 A Crim R 146; R v McMinn [1982] VR 53; Bellchambers (1982) 7 A Crim R 463. 441 [1982] VR 53 at 55. Bell by the Crimes (Sexual Offences) Act 1980 and there are similar Acts in other States." In New Zealand, a statute enacted in 1961 provided that no man could be convicted of rape of his wife unless, at the time of the intercourse, there was in force a decree nisi of divorce or nullity and the parties had not resumed cohabitation, or there was in force a decree of judicial separation or a separation order442. An amendment to the statute in 1981 maintained the immunity, save in cases where the husband and wife were living separately443. This restricted immunity was not removed until 1986444. The Model Penal Code, first published by the American Law Institute in 1962, relevantly provided that "[a] male who has sexual intercourse with a female not his wife is guilty of rape"445. In the revised commentary, published in 1980, this "traditional limitation" of the offence was maintained446. The proposition that by the mid-20th century or earlier the immunity had fallen into desuetude as the result of changes in the conditions of society is without support. In this country, as in other common law countries, the continued existence of the immunity does not appear to have been seen as inconsistent with the recognition of the equal status of married women. There is the curious spectacle in this appeal of the respondent and the Attorney-General for South Australia contending that the maintenance of the immunity by the mid- 20th century was inconsistent with the rights and privileges of married women, notwithstanding that as late as 1976 the Parliament of South Australia chose to preserve it447. 442 Crimes Act 1961 (NZ), s 128(3). 443 Family Proceedings Act 1980 (NZ), First Schedule. 444 Crimes Amendment Act (No 3) 1985 (NZ), s 2. 445 American Law Institute, Model Penal Code: Official Draft and Explanatory Notes, 446 American Law Institute, Model Penal Code and Commentaries (Official Draft and Revised Comments), (1980), Pt 2, Art 213 at 271-275, 341-346. The Comment notes that the rule existed at common law, prevailed at the time the Model Penal Code was drafted and "has been continued in most revised penal laws": at 341. 447 The original Bill introduced into Parliament, which purported to abolish the immunity completely, was rejected by the House of Assembly: Sallmann and Chappell, Rape Law Reform in South Australia: A Study of the Background to the Reforms of 1975 and 1976 and of their Subsequent Impact, Adelaide Law Review Research Paper No 3, (1982) at 20-21, 30-31. Bell By the mid-20th century, the notion that the immunity depended on the wife's irrevocable consent to intercourse may no longer have been seen as the justification for it. However, this is not to accept that the immunity had "crumbled to dust". The contemporary evidence suggests that the immunity was a recognised and accepted feature of the law of rape, albeit that the rationale supporting it may have changed. In 1954, Norval Morris and A L Turner, both then senior lecturers in law at the University of Melbourne, writing of the law respecting marital rape, were critical of irrevocable consent as the justification for the immunity448. They went on to discuss the "special position" of a married couple in law and in fact and to say449: "Intercourse then is a privilege at least and perhaps a right and a duty inherent in the matrimonial state, accepted as such by husband and wife. In the vast majority of cases the enjoyment of this privilege will simply represent the fulfilment of the natural desires of the parties and in these cases there will be no problem of refusal. There will however be some cases where, the adjustment of the parties not being so happy, the wife may consistently repel her husband's advances. If the wife is adamant in her refusal the husband must choose between letting his wife's will prevail, thus wrecking the marriage, and acting without her consent. It would be intolerable if he were to be conditioned in his course of action by the threat of criminal proceedings for rape." The leading Australian text on the criminal law published in 1965 praised the decision in R v Clarke450, which allowed an exception to the immunity; however, the author went on to observe451: "[A] husband should not walk in the shadow of the law of rape in trying to regulate his sexual relationships with his wife. If a marriage runs into difficulty, the criminal law should not give to either party to the marriage 448 Morris and Turner, "Two Problems in the Law of Rape", (1954) 2 University of Queensland Law Journal 247 at 258. 449 Morris and Turner, "Two Problems in the Law of Rape", (1954) 2 University of Queensland Law Journal 247 at 259. 450 [1949] 2 All ER 448. See fn 295 above. 451 Howard, Australian Criminal Law, (1965) at 146. Bell the power to visit more misery upon the other than is unavoidable in the nature of things." The Mitchell Committee explained its reasons for proposing to confine the immunity in this way452: "The view that the consent to sexual intercourse given upon marriage cannot be revoked during the subsistence of the marriage is not in accord with modern thinking. In this community today it is anachronistic to suggest that a wife is bound to submit to intercourse with her husband whenever he wishes it irrespective of her own wishes. Nevertheless it is only in exceptional circumstances that the criminal law should invade the bedroom. To allow a prosecution for rape by a husband upon his wife with whom he is cohabiting might put a dangerous weapon into the hands of the vindictive wife and an additional strain upon the matrimonial relationship. The wife who is subjected to force in the husband's pursuit of sexual intercourse needs, in the first instance, the protection of the family law to enable her to leave her husband and live in peace apart from him, and not the protection of the criminal law. If she has already left him and is living apart from him and not under the same roof when he forces her to have sexual intercourse with him without her consent, then we can see no reason why he should not be liable to prosecution for rape." (emphasis added) The views expressed by the Mitchell Committee were in line with those expressed by the authors of the revised commentaries to the US Model Penal Code in 1980453 and by the English Criminal Law Revision Committee in 452 Criminal Law and Penal Methods Reform Committee of South Australia, Special Report: Rape and Other Sexual Offences, (1976) at 14 [6.2]. 453 American Law Institute, Model Penal Code and Commentaries (Official Draft and Revised Comments), (1980), Pt 2, Art 213 at 345: "The problem with abandoning the immunity ... is that the law of rape, if applied to spouses, would thrust the prospect of criminal sanctions into the ongoing process of adjustment in the marital relationship." 454 Criminal Law Revision Committee, Sexual Offences, Report No 15, (1984) Cmnd 9213 at 21 [2.69]. Explaining the majority view, which was not to remove the immunity, the Committee said: "Some of us consider that the criminal law should keep out of marital relationships between cohabiting partners – especially the marriage bed – except where injury arises, when there are other offences which can be charged." Bell In R v C, the English Court of Appeal set out the advice that an imagined solicitor might have given a husband who inquired as to the legality of marital rape in 1970455. This was in the context of a submission respecting the foreseeability of further development of the law in light of decisions which had allowed exceptions to the immunity. The Commonwealth Attorney-General submitted that the hypothesised advice applied with equal force in this case. The determination of the issue raised by this appeal does not depend upon consideration of foreseeability of change to the law. Nonetheless, the opinions of the academic lawyers and the members of law reform committees set out above may suggest that the solicitor in R v C was a man in advance of his times. There is a more fundamental difficulty with the submission that the Court should hold that a substantive rule of law affecting liability for a serious criminal offence has simply disappeared because of a perception that changed conditions of society no longer provided a justification for it. The powerful reasons against an ultimate court of appeal varying or modifying a settled rule or principle of the common law456 apply with particular force to a variation or modification which has the effect of extending criminal liability. It is for the parliament to determine that a rule of exemption from criminal liability is no longer suited to the needs of the community. The respondent and the Attorney-General for South Australia submitted that it is the responsibility of this Court to modify the law to avoid the "unjust" operation of a rule of immunity respecting criminal liability457. The submission is singular, given that there is no jurisdiction in Australia in which the common law governs a husband's liability for the rape of his wife. No occasion arises to modify the law to make it "an effective instrument of doing justice according to contemporary standards in contemporary conditions"458. The law of marital rape in each Australian jurisdiction has been brought into line with contemporary 455 R v C [2004] 1 WLR 2098 at 2103-2104 [19]; [2004] 3 All ER 1 at 6-7. 456 State Government Insurance Commission v Trigwell (1979) 142 CLR 617 at 633 per Mason J (Stephen and Aickin JJ agreeing); Zecevic v Director of Public Prosecutions (Vict) (1987) 162 CLR 645 at 664 per Wilson, Dawson and Toohey JJ, 677-678 per Deane J; [1987] HCA 26; Lamb v Cotogno (1987) 164 CLR 1 at 11 per Mason CJ, Brennan, Deane, Dawson and Gaudron JJ; [1987] HCA 457 The respondent's Notice of Contention asserts that, "if [the immunity] ever was part of the common law of Australia, it ceased to be so as at the date of the commission of the offences in this matter". 458 O'Toole v Charles David Pty Ltd (1991) 171 CLR 232 at 267 per Brennan J; [1991] HCA 14. Bell standards. Any statement of the common law respecting the liability of a husband for the rape of his wife with whom he was living could only apply to offences alleged to have been committed before the enactment of the statutory reforms. The declaration of the law for which the respondent contends carries with it that the parliaments of the States and Territories legislated over the course of the last century459 upon a wrong understanding of the law. That understanding was reflected in the Code States in the way in which the offence of rape was defined. In those States, the position remains that a husband is not liable to be convicted for the rape of his wife before the date on which the words "not his wife" were removed from the Criminal Code. In the jurisdictions which preserved the common law, the declaration would make it possible to reach back beyond the date on which statutory reforms were effected and attach liability to conduct occurring not less than a quarter of a century ago. In South Australia, it would be possible to successfully prosecute a man for the rape of his wife in the years up to 1976. In the more recent past, the same man would enjoy an immunity for the same conduct460. That is because the 1976 amendments enacted by the South Australian Parliament with the evident intention of limiting the immunity would now be seen to have conferred it. The fact that the parliaments of every Australian jurisdiction enacted legislation upon the understanding that the immunity was a rule of the common law provides some evidence that it was; and is a good reason for this Court not to now declare it to be otherwise. The rule of law holds that a person may be punished for a breach of the law and for nothing else461. It is abhorrent to impose criminal liability on a person for an act or omission which, at the time it was done or omitted to be done, did not subject the person to criminal punishment. Underlying the principle is the idea that the law should be known and accessible, so that those who are subject to it may conduct themselves with a view to avoiding criminal punishment if they choose462. However, its application does not turn on consideration of whether a person might be expected to have acted differently had he or she known that the proposed conduct was prohibited. Deane J's 459 In the case of Queensland, since 1899. 460 The immunity conferred by s 73(5) of the CLC Act was in force between 9 December 1976 and 16 April 1992. 461 See fn 286 above. See also Polyukhovich v The Commonwealth (1991) 172 CLR 501 at 609-611 per Deane J, 687-688 per Toohey J; [1991] HCA 32; Williams, Criminal Law: The General Part, 2nd ed (1961) at 575-576. 462 Blackstone, Commentaries on the Laws of England, (1765), bk 1 at 45-46. Bell dissenting reasons in Zecevic v Director of Public Prosecutions (Vict) explain why that is so463: "The vice of such a retrospective abolition of a defence to a charge of murder lies not in the prospect of injustice to some imaginary killer who has killed on the basis that his crime will be reduced from murder to manslaughter in the event that he was found to have been acting excessively in self-defence. It lies in the fundamental injustice of inequality under the law which is unavoidable when the administration of the criminal law is reduced to a macabre lottery by what the late Professor Stone described as flagrant violation of the 'well-established judicial policies of the criminal law in favorem libertatis, and against ex post facto punishment'464." The departure from the statement of the elements of self-defence in Viro v The Queen465, sanctioned by the majority in Zecevic, was undertaken in circumstances in which it was considered unlikely to occasion injustice and in which it was acknowledged that the endeavour to state the "defence" by reference to the onus had proved unworkable466. Nothing in the judgments in Zecevic affords support for the acceptance of the respondent's contention that this Court should restate the common law with the effect of extending criminal liability to a class of persons previously exempt from that liability. The common law was demeaning to women in its provision of the immunity. It is no answer to that recognition to permit the conviction of the appellant for an act for which he was not liable to criminal punishment at the date of its commission. For these reasons I would allow the appeal, set aside the answer to the question of law given by the majority in the Full Court and, in lieu thereof, answer that question "no". 463 (1987) 162 CLR 645 at 677-678. 464 Precedent and Law, (1985) at 190. 465 (1978) 141 CLR 88 at 146-147; [1978] HCA 9. 466 Zecevic v Director of Public Prosecutions (Vict) (1987) 162 CLR 645 at 664 per Wilson, Dawson and Toohey JJ. Bell

HIGH COURT OF AUSTRALIA MINISTER FOR IMMIGRATION, CITIZENSHIP, MIGRANT SERVICES AND MULTICULTURAL AFFAIRS APPELLANT AND RESPONDENT Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs v Moorcroft [2021] HCA 19 Date of Hearing: 15 April 2021 Date of Judgment: 16 June 2021 ORDER Appeal allowed. Set aside orders 2, 3, 4 and 5 of the orders made by the Federal Court of Australia on 23 March 2020 and, in their place, order that: order 2 made by the Federal Circuit Court of Australia on 8 March 2019 be set aside; and the appeal to the Federal Court be otherwise dismissed. On appeal from the Federal Court of Australia Representation C L Lenehan SC with N M Wood for the appellant (instructed by Australian Government Solicitor) S J Keim SC with K E Slack for the respondent (instructed by Sentry Law) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs v Moorcroft Immigration – Visas – Application for special category visa – Where respondent's special category visa purportedly cancelled and respondent required to depart Australia in 2018 – Where purported cancellation decision subsequently quashed – Where respondent returned to Australia and refused a special category visa on the basis she was a "behaviour concern non-citizen" as defined in s 5(1) of Migration Act 1958 (Cth) ("Act") due to her removal in 2018 – Where s 5(1) of Act defined "behaviour concern non-citizen" in para (d) as a non-citizen who "has been removed or deported from Australia or removed or deported from another country" – Whether respondent was a "behaviour concern non-citizen" within meaning of para (d) – Whether "removed ... from Australia" means removed in fact or removed in accordance with Act. Words and phrases – "behaviour concern non-citizen", "harsh consequences", "nullity", "removed", "removed or deported from", "theory of the second actor". Acts Interpretation Act 1901 (Cth), s 18A. Migration Act 1958 (Cth), ss 5(1), 14, 32(2), Pt 2 Div 8. Migration Regulations 1994 (Cth), reg 5.15A, Sch 1 item 1219, Sch 2 cl 444.511, Div 444.6. KIEFEL CJ, KEANE, GORDON, STEWARD AND GLEESON JJ. This appeal from a judgment of the Federal Court of Australia concerns the refusal of the respondent's application for a special category visa on 29 January 2019, on the basis that she failed to satisfy the criterion for the visa in s 32(2) of the Migration Act 1958 (Cth) ("the Act") because she was a "behaviour concern non-citizen" within the meaning of s 5(1) of the Act. The visa was refused because the respondent was found to have fallen within para (d) of the definition of "behaviour concern non-citizen", which refers to a non-citizen who "has been removed or deported from Australia or removed or deported from another country". The respondent had been removed from Australia on 4 January 2018, on the basis (subsequently determined to be incorrect) that the respondent was an "unlawful non-citizen", as defined in the Act, who was required to be removed from Australia as soon as practicable in accordance with Div 8 of Pt 2 of the Act (which concerns removal of unlawful non-citizens). The issue in the appeal is the proper construction of para (d) of the definition of "behaviour concern non-citizen". The question is whether "removed ... from Australia" in para (d) refers to an administrative act of removal otherwise authorised by the Act subject to certain constraints, or only such an administrative act performed in accordance with those constraints. The appellant ("the Minister") contended that the expression "removed ... from Australia" means taken out of the country in fact. The respondent's primary contention was that a non-citizen will not have been removed from Australia within the meaning of para (d) unless that removal was effected in accordance with Div 8 of Pt 2 of the Act. By notice of contention, the respondent argued in the alternative that the word "lawfully" or the word "validly" is implied into para (d) so that a person will not have been removed from Australia within the meaning of para (d) unless their removal was effected lawfully or validly. For the following reasons, the Minister's contention is correct, the respondent's notice of contention should be dismissed and the appeal should be allowed. A non-citizen who has been removed from Australia in fact is a "behaviour concern non-citizen" within the meaning of the Act. Background to appeal The respondent is a citizen of New Zealand, who previously resided in Australia as the holder of a special category visa. A special category visa is a Gordon Steward Gleeson temporary visa which allows the visa holder to remain in Australia and to work in Australia while the holder remains a New Zealand citizen1. While living in Australia, the respondent committed criminal offences and was sentenced to a term of imprisonment, but was not required to serve prison time. On 24 December 2017, she left Australia and travelled to New Zealand. By virtue of s 82(8) of the Act, the respondent's visa ceased to be in effect on her departure from Australia. On 2 January 2018, the respondent returned to Australia and, upon presenting her New Zealand passport, was automatically granted a further special category visa. On 3 January 2018, the visa granted to the respondent the previous day was purportedly cancelled pursuant to s 116(1)(e) of the Act ("the purported cancellation decision")2. The respondent was held in immigration detention until early on the morning of 4 January 2018, when she was taken to Brisbane airport and required to depart Australia. The Minister observed that, even though the validity of the visa granted on 2 January 2018 was not affected by the purported cancellation decision, it ceased to be in effect on her removal from Australia, again by virtue of s 82(8) of the Act3. On 28 June 2018, a judge of the Federal Circuit Court of Australia made an order by consent that a writ of certiorari issue directed to the Minister, quashing the purported cancellation decision ("the quashing order"). The Minister accepted that the effect of the quashing order was that the purported cancellation of the respondent's visa was "retrospectively nullified"4, her visa did not cease to be in 1 Migration Regulations 1994 (Cth), Sch 2 cl 444.511, Div 444.6. Section 116(1)(e) provides that, in certain circumstances, the Minister may cancel a visa if satisfied that "the presence of its holder in Australia is or may be, or would or might be, a risk to: (i) the health, safety or good order of the Australian community or a segment of the Australian community; or (ii) the health or safety of an individual or individuals". See also Hicks v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 146 FCR 427 at 437-438 [39]. cf Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597 at 614-615 [51] per Gaudron and Gummow JJ, 618 [63] per McHugh J, 646- 647 [152] per Hayne J; Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476 at 506 [76] per Gaudron, McHugh, Gummow, Kirby and Hayne JJ; Hossain v Gordon Steward Gleeson effect on 3 January 2018 and the respondent was not an unlawful non-citizen on 4 January 2018 when she left Australia. The Minister also accepted that there was no power to remove the respondent on 4 January 2018. On 29 January 2019, the respondent returned to Australia. As her previous visa had ceased to be in effect, she was required to apply for a new visa. On arrival in Australia, the respondent was informed that her application for a new special category visa, made earlier that day, had been refused. The respondent applied to the Federal Circuit Court for judicial review of the decision to refuse her a special category visa. At first instance, Judge Vasta dismissed her application, finding that the respondent was removed from Australia on 4 January 2018 and that the fact of her removal meant that she was a "behaviour concern non-citizen" within para (d) of the definition of that expression5. The respondent appealed to the Federal Court, where Collier J allowed the appeal. Her Honour accepted that "it would be wrong to contort the language of the statute to give it the effect urged on me by the [respondent], and imply the words 'lawfully' or 'validly' into" para (d) of the definition of "behaviour concern non-citizen"6. Even so, her Honour effectively did what she considered would be wrong, implying words into para (d) by concluding that the meaning of "removed" in para (d) meant removed under Div 8 of Pt 2 of the Act7. Her Honour considered that this interpretation avoided "arbitrary or capricious refusal of a visa [that] would thwart the purpose of [the Act]"8. While her Honour accepted that the respondent was physically removed from Australia on 4 January 2018, she noted Minister for Immigration and Border Protection (2018) 264 CLR 123 at 133 [24] per Kiefel CJ, Gageler and Keane JJ. 5 Moorcroft v Minister for Home Affairs [2019] FCCA 772 at [5], [28], [41]. 6 Moorcroft v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2020) 275 FCR 276 at 284 [29]. 7 Moorcroft v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2020) 275 FCR 276 at 284 [31]. 8 Moorcroft v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2020) 275 FCR 276 at 284 [33]. Gordon Steward Gleeson that, as a result of the quashing order, the respondent was not: an unlawful non- citizen at that time; a "removee" under the Act; or removed under Div 8 of Pt 29. The appeal judge also concluded that it was incumbent on the Minister's delegate, in considering the respondent's visa application in January 2019, to be satisfied, as a matter of public record, that the respondent had been either deported under Div 9 of Pt 2 or removed under Div 8 of Pt 2 of the Act before finding that she had been "removed or deported from Australia" for the purposes of para (d). There was material before the delegate, in the form of a letter from the respondent's legal representative to the Australian Border Force dated 29 January 2019, stating that the respondent was "purportedly removed from Australia", referring to the quashing order, and contending that, in the circumstances recorded in the letter, the respondent was not removed from Australia and did not fall within the definition of a "behaviour concern non-citizen". Accordingly, her Honour reasoned that the delegate could not have been satisfied that the respondent had been removed from Australia within the meaning of para (d)10. Evidently, this aspect of the appeal judge's reasons assumed a requirement that the respondent's removal must have occurred under Div 8 of Pt 2. Statutory scheme Section 32 specifies the following criterion for a special category visa: "(2) A criterion for a special category visa is that the Minister is satisfied the applicant is: a non-citizen: who is a New Zealand citizen and holds, and has presented to an officer or an authorised system, a New Zealand passport that is in force; and is neither a behaviour concern non-citizen nor a health concern non-citizen; or 9 Moorcroft v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2020) 275 FCR 276 at 285 [35]. 10 Moorcroft v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2020) 275 FCR 276 at 285 [38]-[40]. Gordon Steward Gleeson a person declared by the regulations, to be a person for whom a visa of another class would be inappropriate; or a person in a class of persons declared by the regulations, to be persons for whom a visa of another class would be inappropriate." In s 5(1) of the Act, "behaviour concern non-citizen" in s 32(2)(a)(ii) is defined as follows: "behaviour concern non-citizen means a non-citizen who: has been convicted of a crime and sentenced to death or to imprisonment, for at least one year; or has been convicted of 2 or more crimes and sentenced to imprisonment, for periods that add up to at least one year if: any period concurrent with part of a longer period is disregarded; and any periods not disregarded that are concurrent with each other are treated as one period; whether or not: (iii) the crimes were of the same kind; or the crimes were committed at the same time; or the convictions were at the same time; or the sentencings were at the same time; or (vii) the periods were consecutive; or has been charged with a crime and either: found guilty of having committed the crime while of unsound mind; or acquitted on the ground that the crime was committed while the person was of unsound mind; Gordon Steward Gleeson has been removed or deported from Australia or removed or deported from another country; or has been excluded circumstances; from another country in prescribed where sentenced to imprisonment includes ordered to be confined in a corrective institution." Neither "removed" nor "deported" is a defined term in the Act. However, s 5(1) of the Act defines "remove" to mean "remove from Australia" and "deportation" to mean "deportation from Australia". "Removee" is defined in s 5(1) to mean "an unlawful non-citizen removed, or to be removed, under Division 8 of Part 2". Proper approach to the constructional question Paragraph (d) of the definition of "behaviour concern non-citizen" is to be interpreted by considering the text, having regard to its context and purpose11. Contrary to the respondent's submission that the Court need not determine the construction of the phrase "removed ... from another country" in para (d), the proper construction of the words "removed ... from Australia" requires consideration of the meaning of para (d) in its entirety, including whether the proper construction of para (d) is consistent with the language and purpose of the whole of the Act12. 11 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 381 [69] per McHugh, Gummow, Kirby and Hayne JJ; Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27 at 31 [4] per French CJ, 46-47 [47] per Hayne, Heydon, Crennan and Kiefel JJ; Certain Lloyd's Underwriters v Cross (2012) 248 CLR 378 at 388-390 [23]-[26] per French CJ and Hayne J; SZTAL v Minister for Immigration and Border Protection (2017) 262 CLR 362 at 368 [14] per Kiefel CJ, Nettle and Gordon JJ; Minister for Home Affairs v DMA18 (2020) 95 ALJR 14 at 26 [44]; 385 ALR 16 at 30. 12 Metropolitan Gas Co v Federated Gas Employees' Industrial Union (1925) 35 CLR 449 at 455 per Isaacs and Rich JJ; K & S Lake City Freighters Pty Ltd v Gordon & Gotch Ltd (1985) 157 CLR 309 at 312 per Gibbs CJ, 315 per Mason J, 322 per Deane J; Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR Gordon Steward Gleeson On its face, para (d) refers to non-citizens who have been removed or deported, as a matter of fact and without more, from Australia or another country. An interpretation in accordance with the ordinary literal meaning of the text is supported by a consideration of the other limbs of the definition of "behaviour concern non-citizen". Each limb of the definition refers to governmental acts: paras (a) to (c) are concerned with judicial acts (conviction, sentences to death or imprisonment, findings of guilt and acquittal), while paras (d) and (e) are concerned with executive acts. Contrary to what might have been suggested by the appeal judge13, in context it would be anomalous if the expression "removed or deported" encompassed the acts of private citizens. As the Minister submitted, the governmental acts specified in the definition of "behaviour concern non-citizen" are apparently convenient proxies for identifying individuals of "concern" by reason of their past behaviour. The definition "is in precise terms which do not allow for any evaluative judgments. It is applied by reference to matters essentially of public record."14 The Minister acknowledged that the legal acts referred to in paras (a) to (c) can be quashed or reversed by a court with the result that there is no decision within the meaning of paras (a) to (c). The respondent submitted that there is no reason to think that Parliament did not intend a similar consequence for para (d), in the case of a removal subsequently found to have been made on the basis of an invalid decision. But to assess whether a decision within the scope of paras (a) to (c) has been quashed is a relatively simple matter, determined by reference to the outcome of an evaluative assessment by a court15. 355 at 381 [69] per McHugh, Gummow, Kirby and Hayne JJ; X v Australian Prudential Regulation Authority (2007) 226 CLR 630 at 664 [116] per Kirby J; Federal Commissioner of Taxation v Jayasinghe (2017) 260 CLR 400 at 412 [31] per Kiefel CJ, Keane, Gordon and Edelman JJ. 13 Moorcroft v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2020) 275 FCR 276 at 284-285 [34]. 14 Hicks v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 146 FCR 427 at 438 [41]. 15 cf HZCP v Minister for Immigration and Border Protection (2019) 273 FCR 121 at 139-140 [76]-[78] per McKerracher J, 151 [124] per Derrington J, 164 [181]-[182] Gordon Steward Gleeson Where such decisions are set aside or quashed on appeal or judicial review, it is reasonable to expect that there will be a public record of the later exercise of judicial power. In contrast, the lawfulness of a removal or deportation order can raise issues about the relevant facts and circumstances, the relevant laws or the application of laws to facts and circumstances. The lawfulness of an act may be challenged without relying on a prior judicial decision and a prior judicial decision will not necessarily be determinative of the question. In those circumstances, and taking into account that para (d) refers to events rather than decisions about events, there is no reason to suppose that para (d) is to be read in the manner contended for by the respondent. In this case, there was a public record of the quashing order, but that order did not change the historical fact that the respondent was removed from Australia, which is a separate event from the event of the purported cancellation decision16. The respondent did not dispute that the remedy of certiorari was not available to quash the act of her removal from Australia. The perspective identified by the "theory of the second actor" also supports an interpretation in accordance with the ordinary meaning of para (d)17. As Gageler J explained in New South Wales v Kable18: "[A] thing done in the purported but invalid exercise of a power conferred by law ... remains at all times a thing in fact. That is so whether or not it has been judicially determined to be invalid. The thing is, as is sometimes said, a 'nullity' in the sense that it lacks the legal force it purports to have. But the thing is not a nullity in the sense that it has no existence at all or that it is incapable of having legal consequences. The factual existence of the thing might be the foundation of rights or duties that arise by force of another, valid, law. The factual existence of the thing might have led to the taking of some other action in fact. The action so taken might then have 16 Australian Education Union v General Manager of Fair Work Australia (2012) 246 CLR 117 at 140 [46] per French CJ, Crennan and Kiefel JJ, 160-161 [113] per 17 See Forsyth, "'The Metaphysic of Nullity': Invalidity, Conceptual Reasoning and the Rule of Law", in Forsyth and Hare (eds), The Golden Metwand and the Crooked Cord (1998) 141 at 146-150; Aronson, Groves and Weeks, Judicial Review of Administrative Action and Government Liability, 6th ed (2017) at 732-733 [10.40]. (2013) 252 CLR 118 at 138-139 [52] (footnotes omitted). Gordon Steward Gleeson consequences for the creation or extinguishment or alteration of legal rights or legal obligations, which consequences do not depend on the legal force of the thing itself. For example, money might be paid in the purported discharge of an invalid statutory obligation in circumstances which make that money irrecoverable, or the exercise of a statutory power might in some circumstances be authorised by statute, even if the repository of the power acted in the mistaken belief that some other, purported but invalid exercise of power is valid." The terms of the definition of "behaviour concern non-citizen" as a whole facilitate what Parliament should be taken to understand would, at least typically, be speedy decision-making by delegates of the Minister at ports, as is reinforced by the terms of s 32(2)(a)(i) of the Act. In this regard, the Minister noted the provisions by which a special category visa will typically be granted or refused to a person in immigration clearance19. Immigration clearance is addressed in Div 5 of Pt 2 of the Act. The relevant provisions of that Division do not contemplate that a visa applicant will spend an extended period of time in immigration clearance20. The interpretation of "removed ... from Australia" as removed from Australia in fact promotes the statutory purpose of fast and simple decision-making about whether to grant or refuse to grant special category visas. Conversely, as earlier noted, to decide whether a person has been removed from Australia or another country in accordance with any relevant legal constraints upon removal may involve the delegate engaging in a complex and time- consuming evaluative assessment as to the circumstances of the person's removal and, in the case of removal from another country, the application of foreign laws to those circumstances. As the Minister submitted, delegates are likely to be ill-equipped to perform such a task at immigration clearance and it is not readily to be supposed that this was Parliament's intention. The respondent invoked the definitions of "remove" and "removee" in the Act to argue for a reading of para (d) as if it contained additional words, so that it relevantly refers to a non-citizen who has been removed from Australia in accordance with Div 8 of Pt 2 of the Act. The argument must be rejected for the 19 Migration Regulations, Sch 1 item 1219(3); Migration (LIN 19/058: Arrangements for special category visa applications) Instrument 2019 (Cth), cl 7. 20 Migration Act 1958 (Cth), ss 166, 167(1), 172(2); see also ss 192(5), 192(7). See Minister for Immigration and Border Protection v Srouji (2014) 139 ALD 267 at 273 [21] per Jagot J. Gordon Steward Gleeson following several reasons. Neither term is used in para (d) (or otherwise in the definition of "behaviour concern non-citizen" or s 32 of the Act). To the contrary, the definition of "remove" arguably supports the Minister's case because, in the absence of any element about the legal basis of removal, it indicates that the fact of removal is a relevant concept in the Act. The word "removee" has a complex definition which incorporates a class of persons (unlawful non-citizens), their relationship to Australia (removed or yet to be removed) and the provisions pursuant to which they were, or will be, removed. An unlawful non-citizen is, by definition, a person in the migration zone21. In contrast, the definition of "behaviour concern non-citizen" expressly applies to non-citizens generally, that is, persons who are not Australian citizens, where a person is seeking a visa and is, at least typically, outside the migration zone22. Section 18A of the Acts Interpretation Act 1901 (Cth) does not apply in this case. The object of s 18A of the Acts Interpretation Act is to promote consistency23. It is far from self-evident that "removed" is another part of speech or grammatical form of the word "removee" as defined in the Act, or that consistency would be achieved by an interpretation of "removed" that incorporates some of the elements of the meaning of "removee". In any event, s 18A applies subject to a contrary intention24. A contrary intention is indicated by the express identification of the definition of "behaviour concern non-citizen" as applying to non-citizens and not only unlawful non-citizens. The use of the words "removed or deported from" twice in para (d) provides further support for its interpretation according to its ordinary meaning. "It is a sound rule of construction to give the same meaning to the same words appearing in different parts of a statute unless there is reason to do otherwise."25 That rule has 21 Migration Act, s 14. 22 Migration Act, s 5(1), definition of "migration zone". 23 cf Redland Shire Council v Stradbroke Rutile Pty Ltd (1974) 133 CLR 641 at 645 24 Acts Interpretation Act 1901 (Cth), s 2. 25 Registrar of Titles (WA) v Franzon (1975) 132 CLR 611 at 618 per Mason J. See also Pearce, Statutory Interpretation in Australia, 9th ed (2019) at 142 [4.7] and the cases cited therein. Cases where the rule was displaced by the relevant context include: McGraw-Hinds (Aust) Pty Ltd v Smith (1979) 144 CLR 633 at 643-644 per Gordon Steward Gleeson particular strength where, as here, two identical expressions are collocated in the same paragraph. Further, the two limbs of para (d) are directed to the same statutory object, that is, as a convenient proxy for identifying persons of "behaviour concern" in deciding whether to grant a special category visa. The literal interpretation avoids a result that might otherwise require delegates on occasion to assess claims as to the legality of actions of foreign governments26. For example, an applicant might claim that their removal from another country was invalid because the foreign law requiring it was itself invalid. Where a constructional choice is available, the Court should incline against a construction that would require the Executive on occasion, and ultimately Australian courts, to assess the legality of actions of other governments27. In particular, as Keane J noted in Plaintiff M68/2015 v Minister for Immigration and Border Protection28: "[I]n Moti, this Court noted that there 'will be occasions' when an Australian court must state 'conclusions about the legality of the conduct of a foreign government or persons through whom such a government has acted'. It may be said immediately that implicit in this observation is the recognition that the statement of conclusions about the legality of conduct under the law of a foreign sovereign State may be justified as an exception to the settled principles of judicial restraint and international comity but not as being subversive of them." The literal interpretation is capable of producing harsh consequences, in that New Zealand citizens may be precluded from obtaining a special category visa Gibbs J; Clyne v Deputy Commissioner of Taxation (1981) 150 CLR 1 at 10 per Gibbs CJ, 15-17 per Mason J; Murphy v Farmer (1988) 165 CLR 19 at 27 per Deane, Dawson and Gaudron JJ. In the Federal Court, the respondent contended that: "[t]here is a compelling reason why the words 'removed or deported from another country' should not be read as being subject to the lawfulness of the removal or deportation from another country". 27 cf Plaintiff M68/2015 v Minister for Immigration and Border Protection (2016) 257 CLR 42 at 72-73 [48] per French CJ, Kiefel and Nettle JJ, 126-129 [250]-[257] per Keane J, 169 [414] per Gordon J. (2016) 257 CLR 42 at 128 [255] (footnote omitted). Gordon Steward Gleeson if they were removed from Australia in fact, but not in accordance with Div 8 of Pt 2. The respondent contended that this effect is unjust and is to be avoided where the statutory text does not require that construction29. The appeal judge referred30 to the observation of French CJ in Minister for Immigration and Citizenship v Li31, in relation to statutory discretions, that the "area of decisional freedom ... thus left by the statute cannot be construed as attracting a legislative sanction to be arbitrary or capricious or to abandon common sense". Seeking to apply a similar approach, her Honour considered that an interpretation that enabled arbitrary or capricious refusal of a visa would thwart the Act's purpose32. This reasoning is flawed. An interpretation that "removed ... from Australia" means removed in fact does not enable arbitrary or capricious decision-making: it simply requires the decision-maker to decide whether the visa applicant has been removed from Australia as a matter of fact. Underlying her Honour's reasoning is a presupposition that Parliament could not have intended removal from Australia otherwise than in accordance with the Act (such as removal by an official acting in bad faith) to fall within the scope of para (d). But this presupposition begs the constructional question in issue. Harsh consequences are not an inevitable result of the literal interpretation, although they may occur in some cases. At least with respect to removal or deportation from Australia, a person may apply to a court to enjoin that act before 29 Bowtell v Goldsborough, Mort & Co Ltd (1905) 3 CLR 444 at 456 per Barton J; Metropolitan Coal Co of Sydney Ltd v Australian Coal and Shale Employees' Federation (1917) 24 CLR 85 at 99 per Isaacs and Rich JJ; Tickle Industries Pty Ltd v Hann (1974) 130 CLR 321 at 331 per Barwick CJ; Public Transport Commission (NSW) v J Murray-More (NSW) Pty Ltd (1975) 132 CLR 336 at 350 per Gibbs J; Federal Commissioner of Taxation v Australia and New Zealand Banking Group Ltd (1977) 143 CLR 499 at 508-509 per Stephen J; Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation (1981) 147 CLR 297 at 320-321 per 30 Moorcroft v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2020) 275 FCR 276 at 284 [32]. (2013) 249 CLR 332 at 351 [28]. 32 Moorcroft v Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs (2020) 275 FCR 276 at 284 [33]. Gordon Steward Gleeson it occurs (although, in particular circumstances, the opportunity to make an application may be limited). Section 32(2)(b) and (c) and s 195A (where available) provide mechanisms that may allow harsh results to be avoided. Regulation 5.15A of the Migration Regulations 1994 (Cth) declares certain classes of persons to be persons for whom a visa of another class would be inappropriate for the purposes of s 32(2)(c) of the Act. In any event, different views can be held about whether the consequence for the respondent is truly anomalous or, rather, reflective of a legitimate policy choice having regard to competing considerations that may have included the administrative burden of evaluative assessments and international comity33. Thus, the respondent's argument by reference to the consequences of the literal interpretation does not displace the other matters in favour of that interpretation. The respondent's remaining arguments, by reference to the object of the Act, other provisions of the Act (including s 210 and s 503(2)), extrinsic materials and the principle of legality are rejected. As to the last, the principle of legality does not affect the criteria that Parliament has selected in the exercise of its sole right to decide which non-citizens shall be permitted to enter and remain in Australia34. When she returned to Australia on 29 January 2019, the respondent had no right (fundamental or otherwise) to be allowed into Australia. The only relevant right that the respondent possessed was for her application for a further special category visa to be determined lawfully. That right required the proper application of the relevant visa criterion. Conclusion The appeal should be allowed. Orders 2, 3, 4 and 5 made by the Federal Court on 23 March 2020 should be set aside and, in their place, it be ordered that: 33 cf Esso Australia Resources Ltd v Commissioner of Taxation (1998) 83 FCR 511 at 519 per Black CJ and Sundberg J (this case was reversed by this Court on other grounds in Esso Australia Resources Ltd v Federal Commissioner of Taxation (1999) 201 CLR 49). 34 Falzon v Minister for Immigration and Border Protection (2018) 262 CLR 333 at 358 [92] per Nettle J, citing Attorney-General for Canada v Cain [1906] AC 542 at 546; Chu Kheng Lim v Minister for Immigration, Local Government and Ethnic Affairs (1992) 176 CLR 1 at 29 per Brennan, Deane and Dawson JJ (Mason CJ relevantly agreeing at 10), 44-45 per Toohey J, 64-65 per McHugh J. See also Lee v New South Wales Crime Commission (2013) 251 CLR 196 at 310 [313] per Gageler Gordon Steward Gleeson (a) order 2 made by the Federal Circuit Court on 8 March 2019 be set aside; and (b) the appeal to the Federal Court be otherwise dismissed.

HIGH COURT OF AUSTRALIA ALCAN GOVE PTY LTD APPELLANT AND RESPONDENT Alcan Gove Pty Ltd v Zabic [2015] HCA 33 Date of Order: 12 August 2015 Date of Publication of Reasons: 7 October 2015 ORDER Appeal dismissed with costs. On appeal from the Supreme Court of the Northern Territory Representation G M Watson SC with J C Sheller for the appellant (instructed by Bartier Perry) B W Walker SC with G F Little SC for the respondent (instructed by Shine Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Alcan Gove Pty Ltd v Zabic Limitation of actions – When cause of action accrues – Negligence – Damage – Statute abolished cause of action unless accrued before 1 January 1987 – Whether compensable damage suffered upon changes to mesothelial cells following exposure to asbestos – Whether mesothelioma inevitable – Relevance of hindsight – Whether "trigger" for development of disease endogenous or exogenous. Torts – Negligence – Damage – Dust diseases – Mesothelioma – Whether changes to mesothelial cells compensable damage. Words and phrases – "compensable damage", "endogenous", "exogenous", "hindsight", "mesothelial cell changes", "trigger". Workers Rehabilitation and Compensation Act (NT), ss 52(1), 189(1). FRENCH CJ, KIEFEL, BELL, KEANE AND NETTLE JJ. The issue in this appeal was whether the respondent's cause of action in negligence for damages for mesothelioma caused by the inhalation of asbestos fibres in the course of his employment with the appellant between 1974 and 1977 accrued before 1 January 1987. The issue arose because, on 1 January 1987, the substantive provisions of the Workers Rehabilitation and Compensation Act (NT) ("the Act") came into force1. The Act abolished common law actions in negligence with respect to workplace injuries and provided for limited statutory rights to compensation for injured workers. If the cause of action accrued on or after 1 January 1987, it would have been statute barred. The judge at first instance (Barr J) held that the cause of action did not accrue until the onset of malignant mesothelioma; and, according to the evidence given at trial, that was probably at a point between one and five years before the respondent first experienced symptoms of mesothelioma in 2013 or 2014. On that basis, the judge held that the cause of action did not accrue until well after 1 January 19872. The Court of Appeal of the Northern Territory (Riley CJ, Southwood and Hiley JJ) reversed the judge's decision3. They found that, with the benefit of hindsight, it was possible to say that the respondent's mesothelial cells were so damaged shortly after inhalation of asbestos fibres between 1974 and 1977 as "inevitably and inexorably" to lead to the eventual onset of the malignant mesothelioma4. On that basis, the Court of Appeal concluded that the damage done to the mesothelial cells shortly after inhalation was non-negligible compensable damage sufficient to found a cause of action and that the subsequently developed malignant mesothelioma was part of the damage arising in that accrued cause of action. The Court of Appeal was correct. On 12 August 2015, this Court made orders dismissing the appeal. These are the reasons for those orders. 1 The Act was enacted as the Work Health Act 1986 (NT). 2 Zabic v Alcan Gove Pty Ltd (2015) 292 FLR 413. 3 Zabic v Alcan Gove Pty Ltd (2015) 294 FLR 376. 4 Zabic (2015) 294 FLR 376 at 388 [61]. Bell Nettle The facts The expert evidence given at trial was that asbestos fibres are hydrated silicates of aluminium and magnesium which are known to generate oxygen free radicals capable of setting off adverse genetic changes in susceptible cells. When asbestos fibres are inhaled they work their way to the periphery of the lung, eventually through the visceral pleura and ultimately onto the parietal pleura. Mesothelial cells form part of the parietal pleura. They contain "oncogenes" which may be so influenced by methylation and acetylation caused by free radicals as in some cases to lead to the development of abnormal "switches" in the genetic regulation of cell reproduction. Initial molecular changes occur in the mesothelial cells of the pleura soon after inhalation of asbestos fibres. To begin with, those changes are asymptomatic, and otherwise undetectable, and do not in all cases lead to mesothelioma. In cases like the respondent's, however, where they do lead to mesothelioma, the changes typically lie dormant for years, often for decades, until an unknown "trigger" sets off the development of abnormal genetic switches resulting in malignancy and the "domino effect" that culminates in the malignant mesothelial tumour which constitutes mesothelioma. In this case, the respondent inhaled asbestos fibres in the course of his employment between 1974 and 1977 and it was probable that he did not develop a malignant mesothelial tumour until shortly before first experiencing the symptoms of mesothelioma in 2013 or 2014. Nonetheless, based upon the expert evidence concerning the pathology of the disease, it could be inferred that the asbestos fibres inhaled between 1974 and 1977 had then or shortly afterwards (and therefore before 1 January 1987) resulted in initial molecular changes to mesothelial cells which ultimately culminated in the malignant mesothelial tumour. Initially asymptomatic and otherwise undetectable, the changes are likely to have lain dormant until between one to five years before the first manifestation of symptoms. At that point an unknown trigger set off the development of abnormal genetic switches that resulted in malignancy. As will be seen, the evidence of the precise nature of that trigger is decisive in this case. The expert evidence regarding the trigger and the conclusions to be drawn from the evidence are discussed in detail later in these reasons. Bell Nettle The Workers Rehabilitation and Compensation Act At the relevant times5, s 52(1) of the Act provided: "Subject to section 189, no action for damages in favour of a worker or a dependant of a worker shall lie against: the employer of the worker; in respect of: an injury to the worker". Section 189(1) provided: "Where a cause of action in respect of an injury to or death of a person arising out of or in the course of his or her employment arose before the commencement of this section, a claim or action (including a claim or action at common law) in respect of that injury or death may be made, commenced or continued after the commencement of this section as if this Act had never commenced and for that purpose the repealed Act shall be deemed to continue in force." Section 3(1) relevantly defined "injury" as including a disease, and "disease" as including a physical "ailment, disorder, defect or morbid condition, whether of sudden or gradual development". "Cause of action" was not defined in the Act, but it plainly refers to the "fact or combination of facts which gives rise to a right to sue"6. 5 These proceedings were commenced on 28 August 2014. The Act was subsequently renamed the Return to Work Act (NT): see Workers Rehabilitation and Compensation Legislation Amendment Act 2015 (NT). 6 Do Carmo v Ford Excavations Pty Ltd (1984) 154 CLR 234 at 245 per Wilson J; [1984] HCA 17. Bell Nettle Damage is the gist of the action The law is clear that actual damage or injury is an essential element of a cause of action in negligence for personal injury7. (It is not disputed that the respondent established the other elements of his cause of action, namely, the existence and breach of a duty of care, and that the mesothelioma was caused by the appellant's breach of duty.) What may qualify as actionable damage is, however, a question of fact and degree and ultimately of policy8. Kiefel J observed in Tabet v Gett that the "damage necessary to found an action in negligence ... is the injury itself and its foreseeable consequences"9. As Hayne and Bell JJ said in the same case, damage refers to "some difference to the plaintiff [which] must be detrimental"10. In similar vein, in Harriton v Stephens, Crennan J, with whom Gleeson CJ, Gummow and Heydon JJ agreed, said11: "Because damage constitutes the gist of an action in negligence, a plaintiff needs to prove actual damage or loss and a court must be able to apprehend and evaluate the damage, that is the loss, deprivation or detriment caused by the alleged breach of duty. Inherent in that principle is the requirement that a plaintiff is left worse off as a result of the negligence complained about, which can be established by the comparison of a plaintiff's damage or loss caused by the negligent conduct, with the plaintiff's circumstances absent the negligent conduct." 7 Williams v Milotin (1957) 97 CLR 465 at 474; [1957] HCA 83; Wardley Australia Ltd v Western Australia (1992) 175 CLR 514 at 526 per Mason CJ, Dawson, Gaudron and McHugh JJ; [1992] HCA 55; Harriton v Stephens (2006) 226 CLR 52 at 102 [161] per Hayne J, 115 [218] per Crennan J (Gleeson CJ, Gummow and Heydon JJ agreeing at 58 [1]-[4], 113 [208]); [2006] HCA 15. 8 See and compare Stapleton, "The Gist of Negligence – Part I: Minimum Actionable Damage", (1988) 104 Law Quarterly Review 213; Fleming's The Law of Torts, 10th ed (2011) at 225-226. (2010) 240 CLR 537 at 585 [135] (emphasis removed); [2010] HCA 12. 10 (2010) 240 CLR 537 at 564 [66]. See also Rothwell v Chemical & Insulating Co Ltd [2008] AC 281 at 289 [7] per Lord Hoffmann. 11 (2006) 226 CLR 52 at 126 [251]. Bell Nettle The effect of previous decisions Over the last thirty years, there have been a number of decisions concerning actionable damage in relation to mesothelioma. They provide a degree of guidance as to relevant considerations. It is necessary, however, to keep in mind that, because the question is essentially one of fact, each case turns on its own facts and circumstances and, therefore, what has been decided in the past may not necessarily be of great assistance in deciding new and different cases. In Battaglia v James Hardie & Co Pty Ltd12, Vincent J was required to decide whether "pleural thickening" which occurred relatively shortly after the inhalation of asbestos fibres was sufficient to found a cause of action. Pleural thickening is different from the kind of initial mesothelial cell changes which may occur shortly after inhalation of asbestos fibres. It is not malignant and, so far as is known, is not part of any process which leads to malignancy. At most it is an indicium of the possible presence of otherwise undetectable mesothelial cell changes which may lead to mesothelioma. Vincent J ruled that because there was no evidence that the pleural thickening would or even could lead to malignant mesothelioma, it was not compensable damage13. Soon after, in Papadopoulos v James Hardie & Co Pty Ltd, Kaye J held that pleural plaques, which can lead to pleural thickening, were not sufficient damage to found a cause of action because, at the time of trial, the pleural plaques had not developed into mesothelioma or resulted in other symptoms14. There is also a decision of the New South Wales Court of Appeal concerned with the mere risk of contracting mesothelioma following inhalation of asbestos fibres is sufficient to amount to compensable damage. the question of whether In Orica Ltd v CGU Insurance Ltd15, each of the members of the Court of Appeal (Spigelman CJ, Mason P and Santow JA) concluded that the kind of injury which is suffered by reason of no more than the inhalation of asbestos 12 Unreported, Supreme Court of Victoria, 12 March 1987. 13 Battaglia unreported, Supreme Court of Victoria, 12 March 1987 at 17-18. 14 Unreported, Supreme Court of Victoria, 12 February 1988 at 10-11. 15 (2003) 59 NSWLR 14. Bell Nettle fibres is not compensable damage and therefore that a cause of action does not accrue unless and until mesothelioma develops. Spigelman CJ expressed his "Damage is the gist of the action in negligence. The 'injury' occasioned at the time of penetration of the lung by a fibre, if it be injury within the meaning of the policy at all, which I doubt, is so negligible in and of itself, as distinct from its potential, that it does not constitute damage that is compensable at common law." Mason P, to the same ultimate effect, specifically rejected the notion that, because it was possible to look back with the benefit of hindsight and say that the injury suffered upon or shortly after the inhalation of asbestos fibres had resulted in mesothelioma, the claimant's cause of action had accrued at or shortly after inhalation17: "With the benefit of hindsight we know as a fact (because it is shown as more probable than not) that the worker, Mr Dunstan, suffered the disease-inducing injury between 1959 and 1961 when he was employed at the ICI plant. I agree with Santow JA's analysis as to the process whereby it was established that the risk of injury to which he was negligently exposed came home during this period, with the consequence that the negligent employer fell under a potential liability to compensate the worker, his estate and dependants according to tort law. But that liability remained inchoate, in the eyes of tort law, because damage is the gist of the relevant cause or causes of action. The worker did not sue or recover damages on the debatable basis that the chance or fear of contracting mesothelioma was the damage suffered. Mr Dunstan might have suffered devastating injury or been killed, perhaps due to a third party's negligence, before the ingested asbestos fibre triggered the manifestation of his disease that is recognised as the accrual of his tortious cause of action stemming from the negligent exposure at the ICI plant. This did not occur." 16 Orica (2003) 59 NSWLR 14 at 23 [32]. 17 Orica (2003) 59 NSWLR 14 at 28 [72]-[74] (citations omitted). Bell Nettle Santow JA referred to the possibility of a claimant bringing an action for increased risk of contracting mesothelioma but rejected the idea as being against the weight of English and Australian authority. After referring to Professor Stapleton's observations as to the hostility of English judges to the idea of allowing "pure-loss-of-a-physical-chance" as actionable damage18, his Honour continued19: "The weight of authority in Australia is to similar effect, though there may come a time and case as in the United States where it may be possible to demonstrate actual damage, in the form of some psychological condition induced by anxiety, or even increased life insurance premiums or other discernible disadvantage by reason of a greater risk of contracting a disease like mesothelioma from past exposure. So far it has been held in Australia that where there has been an inhalation of asbestos that has led to pleural thickening of the lung at the time of trial, but which has caused no physical discomfort or disability, with only the potential for more serious developments, those physiological changes wrought to that stage could not be said to have amounted to an actionable injury because of the lack of any established harm. The potential for more harmful developments could not alter that situation." The position in the United Kingdom appears to be similar20. In Barker v Corus UK Ltd21, Lord Hoffmann proposed the view that, given the exception to the ordinary rules of causation in relation to cases of mesothelioma which was recognised in Fairchild v Glenhaven Funeral Services Ltd22, it would be appropriate henceforth to treat the risk of contracting mesothelioma as forming the gist of the action23. But his Lordship's view has since been repudiated by a 18 Stapleton, "Cause-in-Fact and the Scope of Liability for Consequences", (2003) 119 Law Quarterly Review 388 at 424, quoted in Orica (2003) 59 NSWLR 14 at 54 19 Orica (2003) 59 NSWLR 14 at 54 [149]-[150] (citations omitted). 20 Rothwell [2008] AC 281. 23 Barker [2006] 2 AC 572 at 589-591 [35]-[39]. Bell Nettle majority of the Supreme Court of the United Kingdom in Durham v BAI (Run off) Ltd24. In this country, where the Fairchild exception has not to date been recognised25, there is still more reason to reject it. It remains to mention Martindale v Burrows26, in which Derrington J held that initial mesothelial cell changes which led to mesothelioma amounted to compensable damage. His Honour reasoned that, because it was possible to look back in hindsight on the basis of the evidence and infer that the initial mesothelial cell changes occurred shortly after the inhalation of asbestos fibres, and that they were the initial step in a natural progression which led inexorably to the mesothelioma which the plaintiff had developed by the time of trial, the initial cell changes were compensable damage27. In summary, therefore, the effect of the previous decisions mentioned to this point appears to be that: The mere risk of contracting mesothelioma which arises upon the inhalation of asbestos fibres is not compensable damage, because the risk may not eventuate28. Pleural plaques or pleural thickening, which may occur shortly after inhalation of asbestos fibres, although a form of physical injury, are not compensable damage because they are asymptomatic and there is not, or at least there was not at the time of the relevant decisions, evidence that 24 [2012] 1 WLR 867 at 895-896 [64]-[65] per Lord Mance JSC (with whom Lord Kerr of Tonaghmore JSC agreed), 904 [77] per Lord Clarke of Stone-cum- Ebony JSC, 907 [90] per Lord Dyson JSC, cf at 915-917 [123]-[130] per Lord Phillips of Worth Matravers PSC; [2012] 3 All ER 1161 at 1193-1194, 1202- 25 See Amaca Pty Ltd v Booth (2011) 246 CLR 36 at 58 [52]-[53] per French CJ, 66- 67 [80]-[82] per Gummow, Hayne and Crennan JJ; [2011] HCA 53. 26 [1997] 1 Qd R 243. 27 Martindale [1997] 1 Qd R 243 at 245. 28 Durham [2012] 1 WLR 867; [2012] 3 All ER 1161. Bell Nettle the pleural plaques or thickening had any potentiality for harm, whether considered on its own or in conjunction with some other process29. The risk of contracting mesothelioma to which a claimant is exposed upon the inhalation of asbestos fibres does not become compensable damage by reason only that, with the benefit of hindsight, it is possible to say that the risk has eventuated and therefore that the inhalation of asbestos fibres caused the claimant's mesothelioma30. (4) Nevertheless, the kind of mesothelial cell changes which sometimes occur shortly after the inhalation of asbestos fibres may be regarded as compensable damage if, in the case of a claimant who is suffering from mesothelioma, and so with the benefit of hindsight, it can be seen that those mesothelial cell changes were the beginning of a continuum that led inexorably to the onset of mesothelioma31. The judgment at first instance The judge at first instance characterised the issue as being "the same" as the issue in Orica. He also took the view that the medical evidence and other facts were "essentially the same" as in Orica. Consequently, he treated Orica as "persuasive" and on that basis held that the initial mesothelial cell changes were not compensable damage32: "All three members of the Court [in Orica] concluded that the employee had not suffered damage compensable at common law until such time as he suffered the onset of mesothelioma. Until that time, 'the tort was not complete'. 29 Battaglia unreported, Supreme Court of Victoria, 12 March 1987; Papadopoulos unreported, Supreme Court of Victoria, 12 February 1988. 30 Orica (2003) 59 NSWLR 14. 31 Martindale [1997] 1 Qd R 243. 32 Zabic (2015) 292 FLR 413 at 431-432 [68], [71]. Bell Nettle Because the plaintiff had not suffered damage prior to 1 January 1987, his cause of action in negligence for contracting malignant mesothelioma had not arisen before that date." The difficulty with that approach, however, is that neither the issue nor the evidence in Orica was precisely the same as in this case. The issue in Orica was framed as being whether, under an insurance contract, the insured was liable to an employee upon that employee inhaling asbestos fibres. The focus of the judgments, and the issue upon which Santow JA differed from Spigelman CJ and Mason P, was whether the term "liability" encompassed an inchoate or potential liability or, alternatively, a liability that would necessarily arise in the future33. The Court appeared to assume, rather than decide, that "damage" at common law did not occur until the onset of mesothelioma34. So far as appears, there was no evidence in Orica nor any consideration of whether the kind of initial molecular mesothelial cell changes which occurred in this case amount to compensable damage if they may be seen in hindsight to have led inexorably to mesothelioma. The reasoning of the Court of Appeal In contrast, the Court of Appeal characterised the issue, correctly, as being whether the initial mesothelial cell changes which in hindsight could be seen to have led inexorably to mesothelioma amounted to compensable damage. After noting the decision of the House of Lords in Cartledge v E Jopling & Sons Ltd35, which held that a plaintiff's cause of action for damages for pneumoconiosis had accrued before the pneumoconiosis could be detected, their Honours continued36: "Determining whether a cause of action has arisen involves an assessment of objective fact, rather than an assessment of the subjective capacity of a plaintiff to muster proof. It follows that hindsight is permitted in determining when a cause of action accrues. The aim is to ascertain when relevant facts, namely the 33 See Orica (2003) 59 NSWLR 14 at 55 [154] per Santow JA. 34 Orica (2003) 59 NSWLR 14 at 23 [32] per Spigelman CJ, 28 [71]-[74] per Mason P, cf at 55 [153] per Santow JA. 36 Zabic (2015) 294 FLR 376 at 385-386 [46]-[49] (footnote omitted). Bell Nettle presence of compensable damage, objectively came into existence. A Court should not be limited to ascertaining whether relevant facts were provable or discoverable at a particular time. For example, the outcome in Cartledge would not have been possible without the Court using contemporary medical evidence to infer when undetectable damage first occurred in the past. Hindsight is frequently employed when one is endeavouring to ascertain the cause or causes of an injury or damage which does not become manifest until some later time. In the present case we consider that hindsight can be used to establish that there was compensable damage, namely changes to the mesothelial cells, prior to 1987. The toxic carcinogen amphibole asbestos had lodged in the [respondent's] lungs and caused genetic change leading to aberrant and abnormal cell growth which culminated many years later into malignant mesothelioma. The cause of action arose when the non- negligible damage was first suffered. The subsequent mesothelioma is part of the damage arising in the accrued cause of action. That damage was no less real, significant and compensable than it would have been had there been medical investigative technologies available at the time that could have identified the damage." The Court of Appeal also rejected the idea that damage consisting of the initial mesothelial cell changes was no more than contingent or prospective. In contrast to a case like Wardley Australia Ltd v Western Australia37, in which liability under a guarantee remained contingent until and unless a future event occurred, and so was not compensable, the Court of Appeal held38: "This was not the case here. Although the medical evidence was to the effect that a person with abnormalities in the mesothelial cells may or may not acquire malignant mesothelioma, the [respondent's] condition was such that the cells would so develop. That conclusion is now established, albeit with the benefit of hindsight. 37 (1992) 175 CLR 514. 38 Zabic (2015) 294 FLR 376 at 387-388 [58]-[61]. Bell Nettle [W]e consider that the [respondent] sustained compensable damage at the time when such inhalation caused changes in his mesothelial cells. According to the medical evidence these changes began to occur very soon after the [respondent's] exposure to asbestos, and prior to 1987. Even though such changes were not symptomatic, and even if such changes may not have been discoverable by medical investigation methods available then, or even now, the subsequent development of the [respondent's] malignant mesothelioma establishes that the damage to the [respondent's] mesothelial cells, prior to 1987, was material damage, and thus compensable. That damage inevitably and inexorably led to the onset of malignant mesothelioma." The nature of the trigger An inference, based on the fact that mesothelioma has occurred, that there must have been earlier initial mesothelial cell changes which inevitably and inexorably led to the mesothelioma logically implies an anterior inference that, once the initial mesothelial cell changes occurred, they were bound to lead to the mesothelioma (assuming only that the respondent did not die of other natural or extraneous causes before the mesothelioma developed). As was previously noticed, initial mesothelial cell changes do not develop into mesothelioma in the absence of a "trigger". It follows that, in order for the Court of Appeal to infer that the initial mesothelial cell changes which occurred in this case were bound inevitably and inexorably to lead to mesothelioma, it was necessary for the Court of Appeal to be able to infer that, once the initial mesothelial cell changes had occurred, the trigger already existed or was otherwise bound to occur. Logically, whether it can be posited that a trigger exists or is bound to occur depends on the nature of the trigger. If the trigger is exogenous, which is to say outside the cell, the point at which the initial mesothelial cell changes become bound to lead to mesothelioma will depend on the nature and timing of the trigger. Suppose, for the sake of illustration, that the trigger is in the nature of another carcinogenic substance or effect that affects mesothelial cells. To take the case of a claimant who is suffering from mesothelioma where it appears that the trigger was the consequence of cigarette smoking which the claimant did not take up until after the occurrence of initial mesothelial cell changes, the earliest point at which the mesothelial cell changes could have become bound to lead to Bell Nettle the mesothelioma would have been when the claimant took up cigarette smoking. Similarly, in the case of a claimant who is suffering from mesothelioma where it appears that the trigger was the consequence of radiation to which the claimant was exposed after the initial mesothelial cell changes, the earliest point at which the mesothelial cell changes could have become bound to lead to the mesothelioma would have been when the claimant was so exposed. Until and unless the trigger occurred it would be no more than a possibility and, therefore, consistently with Wardley, the initial mesothelial cell changes would not be compensable damage. By contrast, where evidence establishes that the trigger is endogenous, which is to say a state of affairs inside the cells which creates an inherent predisposition or susceptibility to mesothelioma, it may logically be inferred that once the initial mesothelial cell changes occurred they were thenceforth bound to lead to mesothelioma. Here it appears that the Court of Appeal proceeded on the basis that the trigger was endogenous. Their Honours inferred from the fact that the respondent is now suffering from mesothelioma that he must have experienced initial mesothelial cell changes shortly after the inhalation of asbestos and that, because he had an inherent predisposition or susceptibility to mesothelioma, those initial mesothelial cell changes were from the moment of their occurrence bound to lead inevitably and inexorably to mesothelioma. Based on the evidence adduced at trial, that conclusion was correct. As counsel for the respondent submitted, although neither of the experts whose reports were in evidence specifically stated that the trigger was endogenous, it is implicit in each report that the trigger was an endogenous cytogenic process within the cells. That appears most clearly in Professor Allen's report, with which Dr Edwards stated his agreement, in the following passage: "As with many cancers, the carcinogen (here asbestos) has an adverse impact on the cellular makeup of the tissues exposed to the carcinogen, and this sets off cellular and nuclear changes in the genes of the tissue, which lie dormant for some years until a trigger (often unknown), which leads to the subsequent development of [the] tumour ... It is thought that asbestos fibres which are hydrated silicates of aluminium and magnesium generate oxygen free radicals ... which are know[n] to have an adverse impact on the genetic makeup of susceptible cells, namely mesothelial cells, and hence lead to the subsequent development of malignant mesothelioma. Bell Nettle I therefore see no intellectual or epidemiologic problem in accepting the fact that his exposure to asbestos in the 1970s led to the development of mesothelioma decades later. ... In individual cases, it is not always known what triggers off the abnormality, ie what flicks the switch, which in turn leads to the tumour. Our knowledge of the cytogenetics of carcinogenesis, including of oncogenes, is not sophisticated or precise enough to point to a particular event which occurs in one particular cell, on one particular day, to give rise to a malignancy." The natural and ordinary meaning of the references to "cytogenetics" (scil, the study of the genetics of cells) and to "oncogenes" (scil, genes with the potential to transform a cell in which they are contained into a tumour cell), and the explication of what occurs in "one particular cell, on one particular day", is that the trigger was considered to be within the cell. And although that conclusion was prefaced on what "it is thought that asbestos fibres" do, the subsequent statement that there was no hesitation in accepting "intellectually" (scil, logically) the connection between the initial cell changes and the subsequent malignancy bespeaks what was logically and epidemiologically considered to be probable. The stated uncertainty as to what flicks the "switch" is beside the point. It is plain that what is described is a cytogenic process which occurs within an oncogene within a person's cells and ultimately perhaps in "one particular cell" on "one particular day" without external stimulus. As counsel for the respondent submitted, that conclusion is fortified by the appellant's decision not to cross-examine either expert at trial, not to call other expert evidence to contradict them, not otherwise to suggest at trial or on appeal that the trigger was not endogenous, and not to contend that the trigger was in any way in the nature of a novus actus interveniens. That is not to say that the appellant thereby waived the need for the respondent to prove that the initial mesothelial cell changes were from the time of their occurrence, or at least from before 1 January 1987, bound to result in mesothelioma. Unlike a statute of limitation properly so called (which prevents the enforcement of an existing cause of action and so can be waived), the effect of s 52(1) of the Act read in conjunction with s 189(1) was to prevent a cause of action arising unless it arose before 1 January 1987. This means that the burden of proof was on the respondent to prove that his cause of action accrued before Bell Nettle 1 January 1987 and nothing in the appellant's conduct of its case could have relieved him of that requirement39. Nevertheless, although the appellant was incapable of waiving proof that the cause of action accrued before 1 January 1987, the appellant was able by the conduct of its case at trial and on appeal impliedly to admit or not dispute facts pertinent to proof. And the fact that the trial and appeal proceeded as they did shows that the appellant did not dispute that the trigger was an endogenous cytogenic process within oncogenes within the cell without any suggestion of exogenous stimuli. In effect, it seems not to have been in issue that the trigger was endogenous. Granted, the trial judge did state at one point in his reasons that, as at 1 January 1987, the respondent did not suffer from any reduction in life expectancy. Taken alone, that observation might be thought to suggest the judge was not persuaded that, as at 1 January 1987, the trigger was bound to occur; and perhaps for the reason that the judge was not persuaded that the trigger was endogenous. But, as counsel for the respondent submitted, read in context, the judge's observation concerning life expectancy is to be seen as directed only to the dramatic reduction in life expectancy which occurred once the respondent began to experience the symptoms of mesothelioma. So much is confirmed by the fact, noted by the Court of Appeal, that the judge approached the case as if the issues were as in Orica and so eschewed any consideration of whether the changes in the respondent's mesothelial cells following his inhalation of the asbestos fibres were bound to lead inevitably and inexorably to the mesothelioma which later resulted. Is the risk of mesothelioma sufficient to constitute compensable damage? Much of the appellant's argument before this Court was directed to whether an initial mesothelial cell change is productive of such a risk of resulting mesothelioma that it should for that reason be considered to be compensable damage. Counsel for the appellant placed heavy emphasis on the decisions earlier referred to, particularly Orica, which establish that a risk of mesothelioma 39 See R v McNeil (1922) 31 CLR 76 at 96 per Knox CJ and Starke J, 100-101 per Isaacs J; [1922] HCA 33; The Commonwealth v Verwayen (1990) 170 CLR 394 at 425 per Brennan J; [1990] HCA 39; Western Australia v Wardley Australia Ltd (1991) 30 FCR 245 at 259. Bell Nettle is not compensable damage. He urged the Court to adhere to that view and submitted that any departure from it would likely be productive of widespread and unpredictable ramifications in the field of personal injury cases. Those submissions, however, were essentially misdirected. Although the trial judge may have conceived of the case as one of risk, it is clear that the Court of Appeal approached the matter on the basis that it was not the risk of mesothelioma but rather the physical injury constituted of the initial mesothelial cell changes the respondent's cause of action to accrue. to compensable damage sufficient for that amounted For present purposes, it may be accepted that, without more, a risk of developing a compensable personal injury cannot sustain a cause of action in negligence for damages for personal injury. It is only when and if the risk eventuates that compensable damage is suffered and, therefore, it is only then that the cause of action in negligence accrues. To borrow Mason P's illustration in Orica40, until and unless that occurs, it is possible that a claimant might suffer some other devastating injury causing death or be killed due to a third party's negligence. It may also be accepted, as the respondent conceded at trial, that at the time when the initial mesothelial cell changes occurred, and therefore as at 1 January 1987, the respondent had no way of knowing whether any such changes had occurred and therefore could not then have established the existence of a cause of action. More generally, it may be said that, given the current state of medical knowledge disclosed by the evidence, it would be impossible to say that the inhalation of asbestos fibres is bound to lead to mesothelioma until and unless it does in fact lead to mesothelioma, and, therefore, as the law now stands, it would be impossible to sustain a proceeding on a cause of action for negligence for damages for mesothelioma until and unless there are symptoms of mesothelioma. For present purposes, however, all of that is essentially irrelevant. The question here is not the time at which sufficient evidence first became available to establish the existence of a cause of action or, therefore, when the respondent could first have initiated a proceeding for damages based on that cause of action. 40 (2003) 59 NSWLR 14 at 28 [74]. Bell Nettle As Latham CJ observed in Willis v The Commonwealth41, in a statement which was adopted by Wilson, Toohey and Gaudron JJ in Johnson v Perez42: "[W]here the extent and character of what would at one time be described as prospective injury depends upon the happening or non-happening of a particular event and that event has in fact happened, it is unnecessary to speculate as to whether or not this event might happen and, if so, when. In such a case prospective damage ... has become actual." The question is whether it could be inferred in hindsight that a cause of action had accrued before it could have been detected. in Cartledge43, In point of principle, there is no reason why that could not be inferred. As illogical or otherwise there was established exceptionable about drawing an inference after symptoms of a disease first appear that, because of what is known of the aetiology and pathology of the disease, the disease is likely to have begun at an earlier point of time when there were no symptoms or other means of detecting its presence. is nothing On the evidence which was available in this case, there is also no reason in fact why it could not be inferred that there were initial molecular changes in the mesothelial cells which preceded the appearance of symptoms of mesothelioma, and that those initial cell changes led inevitably and inexorably to mesothelioma. Counsel for the appellant called in aid the decision of the Court of Session in Brown v North British Steel Foundry Ltd that a cause of action for damages for pneumoconiosis was not shown to have accrued before the date on which an applicable limitation period was first introduced in Scotland44. He submitted that it established a principle that a cause of action in negligence for damages for personal injury the result of respiratory disease does not accrue until and unless 41 (1946) 73 CLR 105 at 109; [1946] HCA 22. 42 (1988) 166 CLR 351 at 368-369; [1988] HCA 64. 43 [1963] AC 758; cf Brown v North British Steel Foundry Ltd 1968 SC 51 at 64-65 per Lord President Clyde; Rothwell [2008] AC 281 at 311 [86] per Lord Rodger of Earlsferry. Bell Nettle the symptoms of the disease first appear. But, properly understood, that is not the effect of that decision. On the evidence adduced in that case, it was not possible to say that pneumoconiosis inevitably resulted from the inhalation of silica or, although it had in fact resulted, to say when it had begun. As "It was clear on the evidence that pneumoconiosis does not inevitably follow on the inhalation of noxious dust. Accordingly the deceased could not have raised an action founded on the bare averment that he had been exposed to noxious dust. He would also have to aver that as a result of that exposure he had contracted pneumoconiosis. There is nothing to show that he had it at that time." Time of accrual of cause of action It is trite law that a tortfeasor must take the victim of the tort as the victim is found to be46. Hence, if as a result of an employer's negligence an employee is caused to inhale asbestos fibres and, due to the employee's predisposition to mesothelioma, the inhalation of fibres results in mesothelioma, the employer will be held liable for the damage thereby inflicted. The question then is whether, as a matter of law, there is any reason why the initial changes in the mesothelial cells which it could be inferred were bound from the time of their onset to lead inevitably and inexorably to the mesothelioma from which the respondent now suffers should not be seen as compensable damage sufficient for the respondent's cause of action in negligence to have accrued at that point. It assists to answer that question to consider what the position would have been if, at the time the initial mesothelial cell changes occurred, there had been evidence available to establish that they had occurred and that, because of the 45 1968 SC 51 at 70 (emphasis added). 46 Bourhill v Young [1943] AC 92 at 109-110 per Lord Wright; Smith v Leech Brain & Co Ltd [1962] 2 QB 405 at 414 per Lord Parker CJ, approved in Mount Isa Mines Ltd v Pusey (1970) 125 CLR 383 at 406 per Windeyer J; [1970] HCA 60; March v E & M H Stramare Pty Ltd (1991) 171 CLR 506 at 534 per McHugh J; [1991] HCA 12; Tame v New South Wales (2002) 211 CLR 317 at 386 [203] per Gummow and Kirby JJ (approving Windeyer J in Pusey), 413 [279] per Hayne J; [2002] HCA 35. Bell Nettle respondent's predisposition to mesothelioma, they were bound inevitably and inexorably to lead to mesothelioma. In those circumstances, the respondent would have had a cause of action in negligence for damages for personal injury caused by the inhalation of asbestos fibres, which was bound to lead to mesothelioma. The malignant tumour would not have begun at that point and therefore there would remain a chance that the respondent would die from other causes before the tumour began. But, even so, the fact that the respondent would otherwise be bound to die from mesothelioma would be sufficient to found a cause of action in negligence for damages for loss of expectation of life47; and clearly, if the malignant tumour began before the matter came to trial, the respondent would be entitled to add to his claim for damages the fact that the tumour had begun48. Parity of reasoning dictates the same result here. Given that with the benefit of hindsight it can be seen that initial mesothelial cell changes occurred shortly after the respondent's inhalation of asbestos fibres, and that they were bound to and did lead inevitably and inexorably to the malignant mesothelioma from which he now suffers, the respondent's cause of action in negligence accrued when those initial mesothelial cell changes occurred and, as the Court of Appeal held, damages for the mesothelial tumour from which he now suffers are recoverable in that cause of action. As a final observation, it does not detract from that conclusion that time may run under statutes of limitation against persons who have been exposed to asbestos fibres but who have not yet contracted mesothelioma or another disease as a result. Their position will be protected by statutes of limitation which, in all States and Territories, either set the limitation periods for personal injury by reference to the time at which a cause of action becomes discoverable or provide for postponement of limitation periods until after the time when the material facts can reasonably be ascertained by the plaintiff49. 47 See, eg, Flint v Lovell [1935] 1 KB 354; Rose v Ford [1937] AC 826; Benham v Gambling [1941] AC 157; Skelton v Collins (1966) 115 CLR 94; [1966] HCA 14. 48 See, eg, O'Brien v McKean (1968) 118 CLR 540 at 545 per Barwick CJ; [1968] HCA 58; Baker v Willoughby [1970] AC 467 at 490-491 per Lord Reid. 49 Limitation Act 1985 (ACT), s 16B; Limitation Act 1969 (NSW), Pt 2, Div 6; Pt 3, Divs 3-4; Limitation Act (NT), s 44; Limitation of Actions Act 1974 (Q), ss 30-31; Limitation of Actions Act 1936 (SA), s 36(1a); Limitation Act 1974 (Tas), ss 5-5A; (Footnote continues on next page) Bell Nettle In light of the result reached, it is not necessary to consider the respondent's notice of contention. Conclusion For these reasons, the appeal was dismissed. Limitation of Actions Act 1958 (Vic), Pt IIA; Limitation Act 2005 (WA), s 55 (general personal injury), s 56 (injury attributable to the inhalation of asbestos).

HIGH COURT OF AUSTRALIA PLAINTIFFS AND SANTOS LIMITED & ORS DEFENDANTS Edwards v Santos Limited [2011] HCA 8 30 March 2011 ORDER 1. A writ of certiorari issue directed to the fourth defendant to quash: the decisions of the Federal Court of Australia made on 18 December 2009 and 17 March 2010 in proceeding QUD 86 of 2009; and the decision of the Full Court of the Federal Court made on 4 June 2010 in proceeding QUD 28 of 2010. 2. Dismiss the application for the issue of a writ of mandamus against the fourth defendant. The first, second and third defendants pay the costs of the plaintiffs in: the Federal Court of and incidental to the first, second and third defendants' motions for summary dismissal; the Full Court of the Federal Court; and this Court. Representation J A McCarthy QC with J F Kildea and A L Tokley for the plaintiffs (instructed B W Walker SC with S B Lloyd SC and S R R Cooper for the first and third defendants (instructed by Blake Dawson Lawyers) R J Webb QC with H P Bowskill and G J D del Villar for the second defendant (instructed by Crown Solicitor (Qld)) Submitting appearance for the fourth defendant Intervener S J Gageler SC, Solicitor-General of the Commonwealth with R G Orr QC and B Lim intervening on behalf of the Attorney-General of the Commonwealth (instructed by Australian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Practice and procedure – Federal Court of Australia – Summary judgment – Applications by defendants to dismiss proceedings summarily under s 31A(2) of Federal Court of Australia Act 1976 (Cth) – Plaintiffs "registered native title claimant" under s 253 of Native Title Act 1993 (Cth) ("NTA") in respect of certain land – Plaintiffs and first and third defendants negotiating Indigenous Land Use Agreement ("ILUA") under NTA that included land first and third defendants claimed was encumbered by "Authority to Prospect" ("ATP") granted by second defendant under Petroleum Act 1923 (Q) – ATP entitled first and third defendants to apply to Minister for grant of lease of encumbered land for purpose of petroleum exploration – Plaintiffs sought declarations that grant of lease to first and third defendants would not be valid and any lease granted would not be a "pre-existing right-based act" within meaning of s 24IB of NTA – Whether plaintiffs have sufficient interest for grant of declaratory and injunctive relief – Whether questions raised by plaintiffs hypothetical – Whether plaintiffs seeking advisory opinion. Practice and procedure – Federal Court of Australia – Jurisdiction – Section 213(2) of NTA conferred jurisdiction on Federal Court with respect to "matters arising under" NTA – Where determination of whether lease would be valid and whether lease would be a pre-existing right-based act may affect ILUA negotiations – Whether negotiation of ILUA a matter arising under NTA. Practice and procedure – High Court – Original jurisdiction – Costs – Application pursuant to s 75(v) of Constitution for writs directed to Federal Court to quash orders of that Court – Section 26 of Judiciary Act 1903 (Cth) empowers High Court to award costs in "all matters brought before the Court" – Section 32 empowers High Court in exercise of original jurisdiction to grant all such remedies as parties are entitled to "so that as far as possible all matters in controversy between the parties" may be "completely and finally determined" – Where High Court quashes orders of Federal Court – Whether High Court may make costs order in place of orders quashed. Words and phrases – "advisory opinion", "certiorari", "completely and finally", "hypothetical", "matter", "reasonable prospects of success", "standing", "sufficient interest". Federal Court of Australia Act 1976 (Cth), ss 31A(2), 33(4B)(a). Judiciary Act 1903 (Cth), ss 26, 32. Native Title Act 1993 (Cth), s 213. FRENCH CJ, GUMMOW, CRENNAN, KIEFEL AND BELL JJ. We agree with Heydon J and for the reasons he gives that the plaintiffs should have the substantive relief of certiorari and an order for costs in this Court against the first, second and third defendants. That leaves the question of costs of the Federal Court proceedings. The application to this Court was made necessary by the success of the first, second and third defendants upon their applications to the Federal Court under s 31A(2) of the Federal Court of Australia Act 1976 (Cth) ("the Federal Court Act") and the refusal by the Full Court of leave to appeal, and by the exception to the appellate jurisdiction of the High Court (otherwise conferred by s 73(ii) of the Constitution) created by s 33(4B)(a) of the Federal Court Act. In the exercise of its original jurisdiction in the present proceeding this Court is required by s 32 of the Judiciary Act 1903 (Cth) ("the Judiciary Act") to grant remedies apt to "completely and finally" determine, so far as possible, all matters in controversy between the parties regarding the errors by the primary judge upon the s 31A(2) applications and by the Full Court in refusing leave to appeal. The orders quashed upon the grant of certiorari include the costs orders against the plaintiffs obtained by the first and third defendants. The second defendant did not seek costs of the proceedings in the Federal Court, including before Logan J and the Full Court. The orders now to be made by this Court will not effect the complete relief to the plaintiffs mandated by s 32 of the Judiciary Act unless the plaintiffs not only are relieved from the burden of the costs of the first and third defendants erroneously imposed upon them in the Federal Court but also are placed in the favourable position with respect to costs they themselves would have enjoyed had the Federal Court litigation not been determined in the fashion which has attracted certiorari from this Court. The plaintiffs correctly submit that had the s 31A(2) applications been dismissed and, failing that, had an appeal by them to the Full Court been successful, there is no reason why costs should not have followed the event. The relief granted in this Court should include an order that the first, second and third defendants pay the costs of the plaintiffs of the Federal Court proceedings, including the Full Court proceedings. Hayne HAYNE J. I agree that the plaintiffs are entitled to certiorari to quash the orders made at first instance in the Federal Court of Australia (by Logan J) and the orders made on application for leave to appeal to the Full Court of that Court. The costs of the proceedings in this Court should follow the event. I do not agree that this Court can make any order in substitution for the costs orders that were made in the Federal Court at first instance and on the application for leave to appeal. In Kirk v Industrial Court (NSW), six members of this Court held1 that the Court of Appeal of the Supreme Court of New South Wales, exercising the original jurisdiction of that Court, had power to quash orders of the Industrial Court of New South Wales but did not have power to make any order in place of the orders that had been quashed. For the reasons which led to the majority's conclusion in Kirk about the powers of the Court of Appeal, the same conclusion must be reached about the powers of this Court. Because no appeal lies to this Court against the refusal of the Full Court of the Federal Court to grant leave to appeal against the orders of Logan J2, the plaintiffs brought the present proceedings in the original jurisdiction of this Court. The plaintiffs sought certiorari to quash the orders made in the Federal Court, and mandamus directing the Federal Court to hear and determine the proceedings the plaintiffs had instituted in that Court. Because the plaintiffs claimed mandamus against officers of the Commonwealth, the action in this Court was within its original jurisdiction under s 75(v) of the Constitution. The importance of the distinction between this Court's appellate and original jurisdiction has been repeatedly emphasised in cases concerning the powers of the Court on appeal. In particular, the distinction between appellate and original jurisdiction is central to the reasoning which underpins the established doctrine of the Court that further evidence will not be received on appeal3. The distinction between appellate and original jurisdiction is no less important when considering what orders this Court can make in a matter where the Court's jurisdiction is conferred by s 75(v). (2010) 239 CLR 531 at 584 [110]-[111]; [2010] HCA 1. 2 Federal Court of Australia Act 1976 (Cth), s 33(4B)(a). 3 See, for example, Victorian Stevedoring and General Contracting Co Pty Ltd and Meakes v Dignan (1931) 46 CLR 73; [1931] HCA 34; Mickelberg v The Queen (1989) 167 CLR 259; [1989] HCA 35; Eastman v The Queen (2000) 203 CLR 1; [2000] HCA 29. Hayne The plaintiffs submitted that this Court's power to order the first, second and third defendants to pay the plaintiffs' costs of the proceedings in the Federal Court, at first instance and on application for leave to appeal to the Full Court, came from either s 26 or s 32 of the Judiciary Act 1903 (Cth) or some combination of the operation of those provisions. It is convenient to deal first with s 26. Section 26 of the Judiciary Act gives this Court "jurisdiction to award costs in all matters brought before the Court, including matters dismissed for want of jurisdiction". No doubt, the enactment of s 26 recognised that, in England, "[c]osts in Courts of Common Law were not by Common Law at all, they were entirely and absolutely creatures of statute"4. Be this as it may, s 26 of the Judiciary Act, in its terms, is directed to the awarding of costs in the particular matter that is "brought before the Court"; it is not concerned with the costs of matters other than the matter in this Court. It is to be accepted, as noted in De L v Director-General, NSW Department of Community Services [No 2]5, that the power given by s 26 should not be narrowed. But in considering how s 26 is engaged in the present matter, it is also necessary to recognise that the matter in this Court centred upon the claim by the plaintiffs that the Federal Court had, because of jurisdictional error, neglected to exercise jurisdiction conferred on it and that the plaintiffs were thus entitled to relief under s 75(v) of the Constitution, and associated relief. The matter in this Court arose out of, but was distinct from, the controversy or matter that was before the Federal Court. The justiciable controversy in the Federal Court was whether the plaintiffs were entitled, as against the defendants in that Court, to any of the declaratory or injunctive relief claimed in that Court. In this Court, the justiciable controversy was whether the Federal Court's orders disposing finally of the proceedings in that Court were infirm on account of jurisdictional error. Unlike the case of committal for trial followed by trial, in which a single matter proceeds through more than one court6, and unlike the case in which this Court's appellate jurisdiction is engaged, the "matter brought before the Court" here is distinct from the matter that was 4 Garnett v Bradley (1878) 3 App Cas 944 at 962 per Lord Blackburn; Knight v FP Special Assets Ltd (1992) 174 CLR 178 at 182; [1992] HCA 28. (1997) 190 CLR 207 at 212 per Brennan CJ and Dawson J, 221 per Toohey, Gaudron, McHugh, Gummow and Kirby JJ; [1997] HCA 14. 6 R v Murphy (1985) 158 CLR 596 at 614, 617-618; [1985] HCA 50. See also Re Wakim; Ex parte McNally (1999) 198 CLR 511 at 585-586 [138]-[140]; [1999] HCA 27. Hayne brought before the Federal Court. The distinction between the matters is emphasised by the difference in parties to the two proceedings. In this Court, the relevant officers of the Commonwealth (here the Federal Court) are necessary parties. It is the combination of the identity of those parties as officers of the Commonwealth and the relief which is sought which founds this Court's jurisdiction. In the Federal Court, the parties to the controversy were the plaintiffs and those parties who are the first three defendants in this Court. The power given to this Court by s 26 of the Judiciary Act is power to award costs in the matter before this Court, not the matter that was before the Federal Court. Section 26 does not authorise the making of an order providing for the costs incurred in the matter in the Federal Court. Section 32 of the Judiciary Act gives the High Court power to grant complete relief in the exercise of its original jurisdiction and in any cause or matter pending before the Court, whether originating in the Court or removed into it from another court. Section 32 provides: "The High Court in the exercise of its original jurisdiction in any cause or matter pending before it, whether originated in the High Court or removed into it from another Court, shall have power to grant, and shall grant, either absolutely or on such terms and conditions as are just, all such remedies whatsoever as any of the parties thereto are entitled to in respect of any legal or equitable claim properly brought forward by them respectively in the cause or matter; so that as far as possible all matters in controversy between the parties regarding the cause of action, or arising out of or connected with the cause of action, may be completely and finally determined, and all multiplicity of legal proceedings concerning any of such matters may be avoided." The certiorari to which the plaintiffs are entitled is granted in the exercise of the powers given by s 32 of the Judiciary Act. This is not a case in which the constitutional writ of mandamus should be ordered. Complete relief is granted to the plaintiffs by an order for certiorari (relief not mentioned in s 75(v)) without going on, pursuant to s 33(1)(a) or (e) of the Judiciary Act, to order the constitutional writ of mandamus to hear and determine the claim which the plaintiffs had made in the Federal Court. The certiorari to which the plaintiffs in this matter are entitled is certiorari to quash the orders made at first instance and in the Full Court of the Federal Court. Reference is made in Re McBain; Ex parte Australian Catholic Bishops Conference7 to some aspects of the history of the development in England of (2002) 209 CLR 372 at 463-465 [255]-[260]; [2002] HCA 16. Hayne certiorari to quash and the relationship between the development of certiorari to quash and the writ of error. But as was pointed out in McBain8, the place which is now occupied by certiorari alongside the constitutional writs of prohibition and mandamus must be determined having close regard the Australian constitutional context. In particular, in a matter of the present kind, where certiorari is directed to a superior court of record for jurisdictional error, it is not to be expected that immediate assistance will be gained by consideration of 19th century English practice in relation to certiorari. Recognising the force of that caveat, it is nonetheless relevant to notice that no English case was drawn to this Court's attention in which any order for costs beyond the costs of the proceeding for certiorari had been ordered in a case where certiorari to quash had issued. And orders for the costs of proceedings in the court to which certiorari was directed were refused in the King's Bench, for want of power, in R v Passman9 and R v Higgins10. Such later dicta as might be thought to touch upon the question11 would also suggest that no order for costs wider than an order disposing of the costs of the proceedings in this Court should be made. Nothing in the leading English practice works of the late 19th and early 20th centuries12 suggests to the contrary. Rather, as was said in R v Northumberland Compensation Appeal Tribunal; Ex parte Shaw13: "It is plain that certiorari will not issue as the cloak of an appeal in disguise. It does not lie in order to bring up an order or decision for rehearing of the issue raised in the proceedings. It exists to correct error (2002) 209 CLR 372 at 465-467 [261]-[266]. (1834) 1 Ad & E 603 [110 ER 1338]. 10 (1836) 5 Ad & E 554 [111 ER 1275]. 11 See, for example, Kydd v Liverpool Watch Committee [1907] 2 KB 591 at 603 per Fletcher Moulton LJ; R v Northumberland Compensation Appeal Tribunal; Ex parte Shaw [1952] 1 KB 338 at 356-357 per Morris LJ. 12 See, for example, Seton, Forms of Judgments and Orders in the High Court of Justice and Court of Appeal, 7th ed (1912), vol 1 at 803-807; Short and Mellor, The Practice on the Crown Side of the King's Bench Division of His Majesty's High Court of Justice, 2nd ed (1908) at 63-83; Chitty, Chitty's Archbold's Practice of the Queen's Bench Division of the High Court of Justice, and on appeal therefrom to the Court of Appeal and House of Lords, in Civil Proceedings, 14th ed (1885), vol 2 at 1555-1574; Grady and Scotland, The Law and Practice in Proceedings on the Crown Side of the Court of Queen's Bench, (1844) at 186-194. 13 [1952] 1 KB 338 at 357. Hayne of law where revealed on the face of an order or decision, or irregularity, or absence of, or excess of, jurisdiction where shown. The control is exercised by removing an order or decision, and then by quashing it." Or, as the same point was put in Craig v South Australia14, certiorari "is not an appellate procedure enabling either a general review of the order or decision of the inferior court or tribunal or a substitution of the order or decision which the superior court thinks should have been made" (emphasis added). Section 32 of the Judiciary Act does not give power to this Court to exercise the powers that were exercisable by an officer of the Commonwealth whose decision is subject to the grant of constitutional writs under s 75(v) (or associated forms of relief like certiorari). That the relief in this case is to be directed to a court neither permits nor requires some different conclusion. By contrast, power to exercise those powers that were available to another court is given to the Court, in the exercise of its appellate jurisdiction, by s 37 of the Judiciary Act. That section provides: "The High Court in the exercise of its appellate jurisdiction may affirm reverse or modify the judgment appealed from, and may give such judgment as ought to have been given in the first instance, and if the cause is not pending in the High Court may in its discretion award execution from the High Court or remit the cause to the Court from which the appeal was brought for the execution of the judgment of the High Court; and in the latter case it shall be the duty of that Court to execute the judgment of the High Court in the same manner as if it were its own judgment." It is under this section that the Court acts, in its appellate jurisdiction, when it modifies an order for costs made in an intermediate appeal court or gives that judgment for costs that ought to have been given in the first instance. And it is then the duty of those other courts to execute the High Court's judgment in the same manner as if it were a judgment of the intermediate or trial court concerned. The procedures and mechanisms of those other courts (for example, for taxing or fixing the amount to be allowed for costs) are thus engaged. No provision is made, whether in the Judiciary Act or otherwise, which enables this Court, on granting relief under s 75(v) or associated relief, to make such order for costs as should have been made by Logan J at first instance or by the Full Court of the Federal Court. No provision is made, whether in the Judiciary Act or otherwise, which would engage the procedures and mechanisms of the Federal Court for fixing, pursuant to the order of this Court, the amount to be allowed for the costs of proceedings in the Federal Court. 14 (1995) 184 CLR 163 at 175; [1995] HCA 58. HEYDON J. This is an application in the original jurisdiction of this Court for the issue of writs pursuant to s 75(v) of the Constitution in relation to decisions of the Federal Court of Australia at first instance (Logan J) and the Full Court of that Court (Stone, Greenwood and Jagot JJ). The plaintiffs were driven to this course because s 33(4B)(a) of the Federal Court of Australia Act 1976 (Cth) ("the Federal Court Act") operates to preclude them from seeking special leave to appeal to this Court against the Full Court's decision. The substance of the relief sought should be granted for the following reasons. The background The plaintiffs, on behalf of the Wongkumara People, have for some time been pursuing but have not yet succeeded in a native title claim in respect of certain land in south-west Queensland and north-west New South Wales ("the Claimed Land"). The plaintiffs are the "registered native title claimant" within the meaning of s 253 of the Native Title Act 1993 (Cth) ("the NTA"). The first defendant is Santos Limited, and the third defendant is Delhi Petroleum Pty Limited ("the petroleum defendants"). The petroleum defendants are the holders of Authority to Prospect 259P ("the ATP") in respect of land in south-west Queensland which falls within the boundaries of the Claimed Land. The ATP was granted by the second defendant, the State of Queensland, on 31 January 1979 under the Petroleum Act 1923 (Q) ("the Petroleum Act"). It was purportedly varied, extended or renewed thereafter – most recently, on 3 January 2008 for a term of four years commencing on 1 January 2007. Under s 40(1) of the Petroleum Act, the holder of an authority to prospect in respect of a particular area may apply to the Minister for a grant of a petroleum lease covering that area. The holder becomes entitled to the grant upon satisfaction of certain conditions contained in s 40(2). The petroleum defendants did not raise any shadow of a doubt about either their willingness to apply or their capacity to satisfy the conditions. On 16 January 2001 six representatives of the Wongkumara People (four of whom are among the plaintiffs) and the petroleum defendants (amongst others) entered an Indigenous Land Use Agreement ("the ILUA") under the NTA. The ILUA was not registered. It was to expire on 16 January 2006. The function of the ILUA was to deal with problems arising from the fact that native title can be difficult to prove, and the processing of native title claims can take a long time. To use the words of the Explanatory Memorandum to the Native Title Amendment Bill 199715: 15 At par 7.2. "over most of mainland Australia, governments and others seeking to use land do not know if native title exists, and if it does, who holds it. It is difficult in such circumstances to have agreements which provide the necessary level of legal certainty. These provisions [including what is now Pt 2 Div 3 subdiv C of the NTA] are designed to give security for agreements with native title holders, whether there has been an approved determination of native title or not, provided certain requirements are met." Not only did the ILUA give security to the petroleum defendants in dealing with native title claimants who may become native title holders, but it gave the plaintiffs, as native title claimants, the opportunity to obtain immediate advantages which would otherwise be postponed until a perhaps distant day when their native title claim succeeds. Thus the recitals to the ILUA included the following account of the ILUA: "The Joint Venture Parties [who included the petroleum defendants] receive certainty in [their] dealings with respect to native title and cultural heritage. The Native Title Parties [who included some of the plaintiffs] receive certainty in the involvement in cultural heritage management in the Joint Venture Parties [sic] dealings with the Project Area as well as compensation, employment and other benefits." The plaintiffs allege that from late 2005 onwards, representatives of the Wongkumara People and the petroleum defendants have negotiated with a view to entering a further Indigenous Land Use Agreement (the "new ILUA") under the NTA in relation to proposed "future acts" within the meaning of the NTA. Those negotiations are in fulfilment of an obligation created by cl 2.4(a) of the ILUA by which the parties agreed to "negotiate the terms of a new ILUA". On 4 November 2005, Mr Paul Woodland, Adviser, Government & Indigenous Affairs, wrote a letter on behalf of the first defendant to the six representatives of the Wongkumara People who had entered the ILUA. The principal parts of the letter to which the parties referred are as follows. It commenced: "This letter is to summarise the proposal Santos put to you on Sunday 11 September (and other meetings) in Charleville for the ILUA … we wish to reach with you in relation to our petroleum operations within the area of your Native Title Claim …, which documentation will supersede the ILUA and associated documentation executed on 16 January 2001." After discussing various points, the letter then said: "Over the term of the current ILUA the [Wongkumara] have made a series of requests for additional benefits. It has been Santos' view that these requests constituted [a] re-opening of negotiations in order to obtain greater benefits for the [Wongkumara]. To date we have viewed this as inappropriate. As we are now negotiating a superseding ILUA …, we consider that it is now appropriate to address these requests. 1. Gift of the Santos Pastoral Leases The [Wongkumara] have requested that Santos gift to them the two Pastoral Leases over Nappa Merri and Kihee. Santos has considered this request and advises that it will not gift these Pastoral Leases. The reasons for this decision are: the request seeks a very significant benefit for the [Wongkumara] as the properties have an estimated value in excess of $20m. As Santos has previously explained, Santos' existing Authorities to Prospect pre-date the [NTA]. Accordingly, as a result of the 'automatic' production licence grant provisions of the [Petroleum Act], the grant of production licences which emanate from those Authorities to Prospect are [sic], in our view, 'pre-existing rights based acts' under the NTA (PERBAs) and, as such, are not subject to the right to negotiate provisions of the NTA. They are therefore similar to other titles granted prior to the NTA." The letter then gave three other reasons for the first defendant's decision. The reference to "pre-existing rights based acts" was a reference to s 24IB of the NTA. The reference to "production licences" was a reference to what s 40 of the Petroleum Act calls "leases". The plaintiffs took issue with the contention that the "production licences", ie leases, would be pre-existing rights based acts. They instituted proceedings in the Federal Court of Australia. Paragraphs 5 and 6 of their amended statement of claim referred to the claim made in the Santos letter. Paragraphs 9 to 11 of the amended statement of claim denied that the ATP could be validly varied so as to extend the term for the four years commencing on 1 January 1983 or for the term for four years commencing on 1 January 1987, and alleged that all renewals were void. The plaintiffs further alleged that the petroleum defendants were not entitled to apply under s 40 of the Petroleum Act for the grant of a lease over the Claimed Land. The original Application claimed two declarations corresponding with those allegations: "3. A declaration that [the ATP] expired on 31 December 1982 and is no longer operative. 4. A declaration that acts of ministers or officers of the second [defendant] purporting to vary, extend or renew the term of [the ATP] beyond 31 December 1982 were and are invalid and of no force and effect." The claim for those orders, and a claim for a particular injunction, have been abandoned. The orders sought in the Amended Application are: "1. A declaration that the grant of a petroleum lease to the first and/or third defendants under s 40 of the [Petroleum Act] in respect of any of the [Claimed Land] and covered by [the ATP] would not be a pre-existing rights based act within the meaning of Subdivision I of Division 3 of Part 2 of the [NTA]. 2. A declaration that the grant of a petroleum lease to the first and/or third defendants under s 40 of the [Petroleum Act] in respect of any of the Claimed Land and covered by [the ATP] would not be valid pursuant to s 24ID of the [NTA] unless the requirements of Subdivision P of Division 3 of Part 2 of that Act had been satisfied. An order restraining the second [defendant] from granting a petroleum lease to the first and/or third [defendants] under s 40 of the [Petroleum Act] in respect of any of the Claimed Land covered by [the ATP]." The trial judge and the Full Court The petroleum defendants and the State of Queensland sought summary dismissal of the plaintiffs' claim under s 31A(2) of the Federal Court Act on the ground that the application had no reasonable prospects of success16. The petroleum defendants also submitted that the Federal Court had no jurisdiction to entertain the application. 16 Section 31A(2) provides: "The Court may give judgment for one party against another in relation to the whole or any part of a proceeding if: (a) the first party is defending the proceeding or that part of the proceeding; and (b) the Court is satisfied that the other party has no reasonable prospect of successfully prosecuting the proceeding or that part of the proceeding." On 18 December 2009 the primary judge acceded to the applications of the petroleum defendants and the State of Queensland17. On 17 March 2010 he made a costs order against the plaintiffs18. The plaintiffs sought leave to appeal against the primary judge's orders. Not content with simply permitting the plaintiffs' leave application to proceed to hearing, on 25 January 2010, the petroleum defendants revealed a certain excess of zeal – and, perhaps, a reluctance, manifested in other ways as well, to have the validity of the ATP examined by a court despite their professed confidence in its validity – by filing a notice of motion seeking summary dismissal of the plaintiffs' application for leave to appeal under s 31A(2) of the Federal Court Act. The Full Court did not deal separately with that notice of motion, but did refuse leave to appeal from the orders of the primary judge19. The reasoning of the primary judge and the Full Court It is not necessary to set out every aspect of the primary judge's reasoning. That is partly because he concentrated on what he perceived to be deficiencies in the argument advanced by the plaintiffs in support of the second declaration they sought. But the order dismissing the whole of the proceedings summarily was not justifiable if there were reasonable prospects of success in relation to the first declaration. The primary judge held that the Federal Court did not have jurisdiction to hear and determine the plaintiffs' application because it was "a paradigm example of an impermissible attempt to secure an advisory opinion."20 He continued: "What is revealed is nothing more than a difference in contractual negotiating positions between the [plaintiffs], who claim in other proceedings, but have not yet been determined to hold, native title in respect of the claimed land and [the petroleum defendants] who may [one] day seek to obtain from the state a petroleum lease in respect [of] part of the claimed land on the strength of [the ATP]. It is not pleaded that any such lease has been granted or is even imminently to be granted." 17 Edwards v Santos Ltd (2009) 263 ALR 473. 18 Edwards v Santos Ltd (No 2) [2010] FCA 238. 19 Edwards v Santos Ltd (2010) 185 FCR 280. 20 Edwards v Santos Ltd (2009) 263 ALR 473 at 483 [43]. The primary judge also said of the plaintiffs21: "Their mere status as a registered native title claimant does not … give them standing to claim any of the relief sought, including any part which relies only on state law." The primary judge saw the claims under the NTA as "obviously doomed to fail", and hence as "colourable" and "not genuine"22. The Full Court considered that the primary judge's decision was not attended with sufficient doubt to warrant granting leave to appeal. Two approaches to the controversy The conclusion reached by the primary judge, not disturbed by the Full Court, was incorrect for the following reasons. The plaintiffs could have established standing and other necessary conditions in one of two ways. The first way was to vindicate an enforceable right of their own. The second was to attack the claim by the petroleum defendants of a right which interfered with the plaintiffs' interests. The primary judge (and, probably, the parties too) concentrated on the first question – whether the plaintiffs had an enforceable right. The primary judge noted the absence of any established native title in the plaintiffs and said that the plaintiffs did not have any right that the petroleum defendants negotiate with them. But the primary judge did not consider whether the plaintiffs had reasonable prospects of establishing that the claim of the petroleum defendants that the grants of "production licences", ie leases, emanating from the ATP were "pre-existing rights based acts" was erroneous on the ground that the ATP was void. The factual circumstances When the plaintiffs requested a gift of the two Pastoral Leases, they were doing so pursuant to negotiations which representatives of the Wongkumara People and the petroleum defendants were contractually obliged to conduct by reason of cl 2.4(a) of the ILUA. They were also negotiations regulated in certain respects by the NTA. The first defendant refused the request for the gift of the two Pastoral Leases. It did so because it said that the Pastoral Leases were worth in excess of $20m on the ground that the ATP pre-dated the NTA, that the extensions of the ATP were valid, and that the grant of "production licences", 21 Edwards v Santos Ltd (2009) 263 ALR 473 at 485 [49]. 22 Edwards v Santos Ltd (2009) 263 ALR 473 at 485 [53]. ie leases, would be automatic. That valuation of over $20m might collapse if the extensions of the ATP were not valid. And if the valuation collapsed, the plaintiffs' prospects of obtaining a gift of the Pastoral Leases would improve. Contrary to what the primary judge said in a different context, the claim of the plaintiffs to challenge the ATP extensions did not depend on the plaintiffs actually having native title23. The new ILUA could be concluded and have the statutory effect given it by the NTA irrespective of whether the plaintiffs had obtained or would obtain a determination that native title exists. Standing, hypothetical questions, advisory opinions, jurisdiction The circumstances just summarised raise the following questions, which cannot be wholly disentangled. Does the Federal Court have jurisdiction to grant declaratory relief? Do the plaintiffs have standing, or a "sufficient interest" or a "real interest"? Is the question which the plaintiffs are raising merely hypothetical? Are the plaintiffs seeking an advisory opinion? Another, more distinct, question is whether the plaintiffs are invoking federal jurisdiction. The jurisdiction to grant a declaration "includes the power to declare that conduct which has not yet taken place will not be in breach of … a law."24 The jurisdiction also includes the power to declare that conduct which has not yet taken place will be a nullity in law. The plaintiffs are claiming that the petroleum defendants had no right to apply to the Minister under s 40 of the Petroleum Act because the ATP had ceased to be valid. The plaintiffs are claiming that there is no power in the Minister to grant a "production licence", ie lease, under s 40, and that any attempt to grant it can be restrained by injunction. These claims are not outside the Federal Court's jurisdiction to grant declaratory and injunctive relief. The plaintiffs have a sufficient interest to make those claims, because success in those claims would advance their interests in the negotiations which the parties were contractually obliged to conduct. The plaintiffs have standing because they have an interest in the question whether the ATP is valid which is greater than that of other members of the public25. The questions which the plaintiffs wished to agitate were not hypothetical. The first defendant's letter of 4 November 2005 had sufficiently indicated the intention of the petroleum defendants to make an application to the Minister under s 40 of the Petroleum Act and it had predicted 23 Edwards v Santos Ltd (2009) 263 ALR 473 at 483 [44]. 24 The Commonwealth v Sterling Nicholas Duty Free Pty Ltd (1972) 126 CLR 297 at 305 per Barwick CJ; [1972] HCA 19. On the breadth of the jurisdiction to grant declarations, see also Forster v Jododex Australia Pty Ltd (1972) 127 CLR 421 at 437-438; [1972] HCA 61. 25 Onus v Alcoa of Australia Ltd (1981) 149 CLR 27; [1981] HCA 50. that success would be "automatic". If so, the plaintiffs would be seriously disadvantaged because their negotiating position would be gravely weakened; if not, the plaintiffs would be correspondingly better off. If the plaintiffs obtained the first declaration sought, it would produce foreseeable consequences for the plaintiffs and the petroleum defendants by allowing them to continue the process of negotiating the new ILUA armed with knowledge of the correct legal position in relation to the ATP. An example of how a person can have standing to obtain a declaration and how a court can have jurisdiction to grant a declaration is afforded by Aussie Airlines Pty Ltd v Australian Airlines Ltd26. Head leases of airport facilities compelled the head lessee to grant a sublease to any "new entrant to the domestic aviation industry". An applicant claiming to be a "new entrant" was held to have standing to obtain a declaration that it was a "new entrant" even though it was not found to have rights under the head leases enforceable against the head lessee. Lockhart J (Spender and Cooper JJ concurring) said that the question was not "hypothetical", it was of "real practical importance" to the applicant, the applicant had a "real commercial interest" in the relief, the head lessee was "plainly a contradictor", and there was "obviously a real controversy"27. So here, whether or not the plaintiffs have rights enforceable against the petroleum defendants, the question whether the ATP is valid is not hypothetical, it is of real practical importance to the plaintiffs, they have a real commercial interest in the relief, the petroleum defendants (and Queensland) are plainly contradictors, and there is obviously a real controversy. Hence the first declaration which the plaintiffs seek about the petroleum defendants' rights is one which a court of equity has jurisdiction to grant; the plaintiffs have standing to seek it; the question they raise is not hypothetical, but concrete and real; and the opinion they seek is not merely advisory. Federal jurisdiction The interest which the plaintiffs are protecting arises out of a federal statute, the NTA. Their activity is designed to ensure that if their native title claim succeeds, they will have received present advantages (in the first instance, the Pastoral Leases) which compensate them for any future subjection of their native title to the interests of the petroleum defendants. The plaintiffs' involvement in the negotiations for the new ILUA led to them becoming involved in a dispute about what its terms might be. That dispute 26 (1996) 68 FCR 406. 27 (1996) 68 FCR 406 at 415. turned on whether the petroleum defendants had the "immediate right"28 which they claimed. On the existence of that "immediate right" turned the validity of a future act. That "immediate right" was integrally connected with the NTA. Hence there existed a "matter" in federal jurisdiction – a matter "arising under this Act" within the meaning of s 213(2) of the NTA29, and a "matter" arising under a law of the Federal Parliament within the meaning of s 39B(1A)(c) of the Judiciary Act 1903 (Cth) ("the Judiciary Act")30. The NTA is linked with the process of negotiating the new ILUA because the NTA contains many provisions in Pt 2 Div 3 subdiv C about the process of negotiation before it is finalised, for example, the obtaining of government assistance (s 24CF), and the making of all reasonable efforts to ensure that all persons who hold or may hold native title in the relevant area are identified and authorise the new ILUA (ss 24CD(7), 24CG(3)(b)(ii) and 24CL(3)). The significance of the issue of what advantages the representatives of the Wongkumara People who were negotiating the new ILUA with the petroleum defendants can obtain stems from, for example, s 24DJ(1) of the NTA. It provides: "Any person claiming to hold native title in relation to any of the land or waters in the area covered by the agreement may make an application to the Registrar objecting against registration of the agreement on the ground that it would not be fair and reasonable to register the agreement." Hence if the representatives of the Wongkumara People succeed in negotiating the new ILUA, other persons claiming to hold native title in the area covered by the new ILUA can object to its registration on the ground that it is not fair and reasonable because it failed to obtain the most favourable terms from the petroleum defendants. And if the new ILUA is not registered, many of its advantages under the NTA do not arise. 28 In re Judiciary and Navigation Acts (1921) 29 CLR 257 at 265 per Knox CJ, Gavan Duffy, Powers, Rich and Starke JJ; [1921] HCA 20. 29 Section 213(2) provides: "Subject to this Act, the Federal Court has jurisdiction in relation to matters arising under this Act." 30 Section 39B(1A) relevantly provides: "The original jurisdiction of the Federal Court of Australia also includes jurisdiction in any matter: (c) arising under any laws made by the Parliament …" At one point the Solicitor-General of the Commonwealth submitted that the only reason why there was no matter arising under the NTA was that there was insufficient concreteness in relation to the possible grant of a "production licence", ie lease, under s 40 of the Petroleum Act. "[H]ad the petroleum lease been sufficiently concrete – because it had been granted, was imminently to be granted or, perhaps, was the subject of a valid application – the Commonwealth submits that there would have been a matter arising under the [NTA] and that there would have been accrued jurisdiction to determine the state law claim." (emphasis in original) The letter of 4 November 2005 from the first defendant gave the petroleum lease question concreteness: the letter represented its grant as being "automatic", and the petroleum defendants maintained that position in oral argument. At another point the Solicitor-General of the Commonwealth correctly accepted general propositions from which the conclusion flows that there is federal jurisdiction because the controversy arising from the assertion by the petroleum defendants that the ATP would automatically lead to "production licences", ie leases, which were pre-existing rights based acts within the meaning of s 24IB of the NTA, and the denial of that assertion by the plaintiffs on the ground that the ATP is void, is a controversy that arises under the Act. Counsel for the petroleum defendants also accepted that while the first and second declarations sought by the plaintiffs had flaws supporting the orders of the Federal Court for other reasons, the question whether they should be granted was within the jurisdiction of the Federal Court. These concessions by the petroleum defendants and the Solicitor-General were correct. While a claim to damages for breach of contract is a claim for relief under State law, if the contract is in respect of a right which is a creature of federal law, the claim arises under the federal law31. That is true whether the State law is common law, like the law of contract, or statute law, like the position of the ATP in relation to the "production licences", ie leases, under s 40 of the Petroleum Act. And there is also a matter arising under a federal law if the source of a defence which asserts that the defendant is immune from a liability or obligation of that defendant is a law of the Commonwealth32. Here the petroleum 31 LNC Industries Ltd v BMW (Australia) Ltd (1983) 151 CLR 575 at 581; [1983] HCA 31. 32 Felton v Mulligan (1971) 124 CLR 367 at 408; [1971] HCA 39; Agtrack (NT) Pty Ltd v Hatfield (2005) 223 CLR 251 at 262 [29]; [2005] HCA 38. defendants are alleging that they are immune from the "right to negotiate provisions of the NTA" because of the pre-existing rights based acts provisions of the NTA. Hence there is a matter arising under a federal law. Conclusion The opinion of the primary judge, not disturbed by the Full Court, was erroneous in concluding that there was no matter, that the plaintiffs had no standing, that the plaintiffs' application was merely for an advisory opinion, and that the Federal Court had no jurisdiction. Mistakenly to deny jurisdiction is a jurisdictional error attracting a writ of certiorari. Some arguments of the defendants In view of the conclusion just arrived at, many of the arguments advanced by the parties are immaterial. But it is necessary to note a few arguments put by the petroleum defendants and the State of Queensland, even though they are immaterial. The petroleum defendants argued that the proceedings were hypothetical for the following reason. They contended that the plaintiffs were arguing that if the ATP were invalid, the grant of "production licences", ie leases, could be a proper subject for the new ILUA. They continued: "If the plaintiffs' argument that the ATP is invalid were correct …, there is nothing that an ILUA could do to remedy that defect. What follows is that, if the ATP is valid then the grant of a petroleum lease would be valid as a PERBA …; in such a case there is no need to include reference to it in any ILUA. Conversely, if the ATP were to be found to be invalid, then the petroleum defendants would have no capacity under State law to obtain petroleum leases pursuant to that ATP and therefore there would be no need to address that issue in any ILUA either. That is, whatever view were to be taken of the validity of [the ATP], there is no cause for it ever to be the subject of an ILUA, showing again the hypothetical nature of the present proceeding." This submission does not undercut the proposition that the bargaining position of the plaintiffs could be much improved if they could demonstrate the invalidity of the ATP, because it would negate one of the reasons why the petroleum defendants refused to make a gift of the Pastoral Leases. The same proposition answers another argument of the petroleum defendants: that the plaintiffs identified as a "matter" the question of what can lawfully be the subject of the new ILUA, but that had not been pleaded. The petroleum defendants also submitted that the orders made in the Federal Court should be upheld because an agreement providing for consents to the construction of pipelines had been made between the parties in October 2006. They argued that this revealed the amended statement of claim to be defective because the allegation that negotiations had been on foot from about late 2005 was factually incorrect. The October 2006 agreement was not relied on before the primary judge. It was relied on for the first time in this Court. The parties, including the petroleum defendants, invited the primary judge to assume the factual correctness of the plaintiffs' case as alleged in the amended statement of claim33. To invite this Court to take the October 2006 agreement into account is to depart from that agreed position without warrant. If the petroleum defendants thought that the October 2006 agreement were fatal to the plaintiffs' case as presented, the appropriate course would have been to plead the October 2006 agreement in their defence – a document which they never filed – and debate its significance either on a summary judgment application or, more satisfactorily, at a trial. In the end the petroleum defendants did not press the argument and conceded that the negotiations for a new ILUA were not completed. Another argument advanced by the petroleum defendants was that the plaintiffs' litigation was pointless because the petroleum defendants "will not choose to enter into an ILUA" which deals with the "production licences", ie leases. The proposition that the petroleum defendants would not enter an ILUA dealing with that matter was not advanced in the 4 November 2005 letter from the first defendant, or at any time until the hearing in this Court. The submission encounters numerous difficulties pointed out in argument, but it is not necessary to deal with them, because eventually the petroleum defendants abandoned the argument. The State of Queensland repeatedly submitted that the validity of the ATP was not challenged by the plaintiffs. Both the State of Queensland and the petroleum defendants drew attention to the removal of the third declaration, which appeared in the original Application, from the Amended Application. The amended statement of claim certainly challenges the validity of the ATP. And its invalidity is an essential step in the reasoning justifying the making of the first declaration. The removal of the third declaration was not an abandonment by the plaintiffs of their contention: that contention remains fundamental to the proceedings. The petroleum defendants and the State of Queensland also made numerous criticisms of the amended statement of claim, the relief sought in the These Amended Application, and supposed disparities between complaints were not of sufficient significance in this case to justify summary dismissal. They were matters which could have been attended to either before trial or in the process of working out what relief was appropriate at the end of the them. 33 Edwards v Santos Ltd (2009) 263 ALR 473 at 477 [15]. trial. This was illustrative of the way in which the present case was an inappropriate use of s 31A proceedings. The function of that provision is not to substitute for the resolution of real controversies at a trial a premature termination of them by summary means. Orders Substantive relief. The plaintiffs apply to this Court for an order that a writ of certiorari issue to quash the decision of the primary judge and of the Full Court. That application should be granted. The writ of certiorari is not mentioned in s 75(v) of the Constitution, but it may issue in the exercise of an implied ancillary or incidental authority to the effective exercise of s 75(v) jurisdiction34. The plaintiffs also apply for mandamus against the fourth defendant (the Federal Court and its judges). That application should be rejected on the ground that that type of relief is not necessary in this case. Plaintiffs' costs in High Court: petroleum defendants. The petroleum defendants submitted that the costs of the proceedings in this Court should follow the event, save that their costs in this Court should be paid by the plaintiffs (or, alternatively, that no order should be made as to costs) to the extent that amendments to the plaintiffs' Amended Application and amended statement of claim were necessary elements in the plaintiffs' success in this Court. The plaintiffs' success in this Court does not depend on the necessary elements postulated by the petroleum defendants. Hence the application of the petroleum defendants for a special costs order must be rejected. Plaintiffs' costs in High Court: State of Queensland. The State of Queensland accepted that it could not argue against an order that costs follow the event in this Court unless one of two submissions succeeded. The first submission was that no order should be made as to costs in this Court if the plaintiffs succeeded on a basis not previously argued by them, but first identified by this Court, namely the proper construction of s 31A of the Federal Court Act or the correctness of Lardil Peoples v Queensland35. The second submission was that no order should be made as to costs in this Court if the plaintiffs succeeded on a basis raised by the plaintiffs for the first time in this Court, namely reliance upon the Petroleum and Gas (Production and Safety) Act 2004 (Q) as the source of power to grant any "production licence", ie lease. The success of the plaintiffs in this Court does not rest on either of the bases described. Hence the application 34 Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82 at 90-91 [14]; [2000] HCA 57, approved in Bodruddaza v Minister for Immigration and Multicultural Affairs (2007) 228 CLR 651 at 673 [63]; [2007] HCA 14. 35 (2001) 108 FCR 453. of the State of Queensland that there be no order as to costs in this Court must be rejected. Plaintiffs' costs in Federal Court. The plaintiffs submitted that the petroleum defendants and the State of Queensland should pay the plaintiffs' costs of and incidental to the motions for summary dismissal heard and determined by Logan J in the Federal Court and the application for leave to appeal to the Full Court of the Federal Court against Logan J's decisions of 18 December 2009 and 17 March 2010. They relied on s 26 of the Judiciary Act. They also relied on the power granted by s 32 of the Judiciary Act to this Court in the exercise of its original jurisdiction to grant remedies "so that as far as possible all matters in controversy between the parties regarding the cause of action, or arising out of or connected with the cause of action, may be completely and finally determined, and all multiplicity of legal proceedings concerning any of such matters may be avoided." The petroleum defendants submitted that they should not have to pay the plaintiffs' costs in the Federal Court and the Full Court of the Federal Court. They submitted that the proceedings there related to one matter, that the proceedings in this Court related to a distinct matter, and that hence s 26 of the Judiciary Act did not apply. They submitted that s 37 of that Act did not apply either. They did not deal with the plaintiffs' s 32 submission. They repeated their submissions in support of their contention that the plaintiffs should pay their costs in this Court. The submissions of the State of Queensland concentrated on s 32 of the Judiciary Act. The State drew a parallel between the supervisory jurisdiction of this Court under s 75(v) of the Constitution and its appellate role in relation to the supervisory jurisdiction of the Supreme Court of New South Wales considered in Kirk v Industrial Court (NSW)36. The State advanced an argument from anomaly. It submitted that "it would be anomalous to interpret s 32 … as enabling the … Court to do in its original jurisdiction what it could not do in the exercise of its appellate jurisdiction in Kirk (under s 37 of the [Judiciary Act])". The plaintiffs' application to this Court arose from the interaction of three factors. One was the success of the petroleum defendants and the State of Queensland on their applications to the Federal Court under s 31A(2) of the Federal Court Act. The second was the refusal by the Full Court of leave to appeal. The third was the bar to an appeal to this Court created by s 33(4B)(a) of the Federal Court Act. 36 (2010) 239 CLR 531 at 584 [110]-[111]; [2010] HCA 1. If these arguments of the petroleum defendants and the State of Queensland succeeded, they would work an injustice and set a precedent open to abuse in future. Both the injustice and the unsatisfactory precedent flow from the correct submission of the plaintiffs that "had the summary judgment application been dismissed there would have been no reason why costs should not have followed the event [and] had the plaintiffs been successful in the Full Court there would have been no reason why costs should not have followed the event". The injustice which would be created if the petroleum defendants and the State of Queensland were correct arises thus. The plaintiffs have demonstrated substantive error on the part of the Federal Court and the Full Court of the Federal Court. Had s 33(4B)(a) of the Federal Court Act not deprived the plaintiffs of a capacity to seek special leave to appeal to this Court, this Court would have had power to set aside the costs orders in dealing with any appeal. But since the plaintiffs cannot seek special leave to appeal to this Court, they will suffer financial loss if the Federal Court costs orders cannot be set aside in these proceedings. It would be unjust if the plaintiffs cannot obtain compensation for that financial loss by a costs order in this Court. The unsatisfactoriness of the precedent which would be created if the arguments of the petroleum defendants and the State of Queensland were accepted flows partly from the equivalent injustice that would arise in future cases. But it also flows from the temptation which it would create for a certain category of litigant. That category comprises wealthy litigants – it is not suggested that the tactics of the petroleum defendants and the State of Queensland in these proceedings, or anything else, indicate that they fall into it – who seek to render fruitless litigation which has been commenced against them by less wealthy litigants, not by achieving success on the merits at a trial, but by other means. One technique is to seek to administer knockout blows before trial by means of strike out applications or summary dismissal applications or stay applications. Another technique is to engage in extensive softening up by making as many interlocutory applications as they choose, and resisting à outrance those of the other side. The goal of the second technique is to cause the claimants to become incapable of providing security for costs and funding the litigation, or at least to conclude that they cannot afford the litigation, and thus to cause them to abandon the litigation before trial. Successes obtained by tactics of the former kind are more likely to come under challenge in this Court than those obtained by tactics of the latter kind. But the propensity of those litigants to engage in tactics of either kind would be intensified by the knowledge that if their resort to these tactics succeeds in the first instance and can only be corrected in s 75(v) proceedings in this Court, they will be immune from compensating those who made claims against them for the costs which the claimants were ordered to pay under costs orders which events in this Court reveal ought not to have been made. The temptation to engage in oppressive proceedings, and the likelihood of its being yielded to, would be increased if those who are in a position to engage in oppressive proceedings think that they will enjoy immunity from costs orders in the Federal Court, even if s 75(v) applications in this Court establish that those oppressive proceedings were not soundly based. Do the injustice and the precedent for abuse which acceptance of the arguments advanced by the petroleum defendants and the State of Queensland would create have to be endured? Or do those arguments rest on a fallacy? There is a fallacy in the State of Queensland's argument. It lies in its argument from anomaly. The majority reasoning in Kirk's case rests on the proposition that there was no legislative provision giving the Court of Appeal of the Supreme Court of New South Wales jurisdiction to make a costs order in place of the orders made in the Industrial Court of New South Wales which were quashed37. But it is fallacious for the State of Queensland to conclude that there is no legislative provision giving this Court jurisdiction to make a costs order in relation to the proceedings in the Federal Court. Section 32 is a legislative provision of that kind. The majority reasoning in Kirk's case is thus distinguishable. As the plaintiffs submitted, s 32 of the Judiciary Act requires this Court to grant remedies which will determine "completely and finally", so far as possible, "all matters in controversy between the parties regarding the cause of action" on which the plaintiffs' application for certiorari relied. A step in that direction is the grant of certiorari itself, for the orders quashed include the costs orders against the plaintiffs in each court in favour of the petroleum defendants. However, by itself that step is incomplete. A grant of the complete relief to the plaintiffs referred to in s 32 of the Judiciary Act requires as well that the plaintiffs be indemnified in relation to their own costs of the Federal Court proceedings which had the flaws leading to certiorari in this Court. The State of Queensland argued in its written submissions that when the matter returns to the Federal Court, that Court can make "appropriate costs orders 37 Kirk v Industrial Court (NSW) (2010) 239 CLR 531 at 584 [110]. The correctness of that assumption might depend on the true construction of a provision to which this Court in Kirk's case was not referred, namely the Civil Procedure Act 2005 (NSW), s 98(6)(c), considered against the background of R v Passman (1834) 1 Ad & E 603 [110 ER 1338]; R v Higgins (1836) 5 Ad & E 554 [111 ER 1275]; The Colonial Bank of Australasia v Willan (1874) LR 5 PC 417 at 440; Supreme Court Costs Rules 1915 (NSW), r 4; Rules of the Supreme Court (Revised) 1965 (UK) (SI 1965/1776), O 53, r 6 and O 62, r 4; Supreme Court Act 1970 (NSW), s 76(2)(c); Supreme Court Rules 1970 (NSW), Pt 52, r 7; and New South Wales Law Reform Commission, Report of the Law Reform Commission on Supreme Court Procedure, Report No 7, (1969) at 17 [42], 106 (marginal note to cl 76(2)), 419 (marginal note to Pt 52, r 7). … in place of any costs orders that may be quashed." The difficulty is that for this Court to put the plaintiffs to the necessity of re-agitating somewhat ancient controversies in making the necessary applications would mean that this Court had not completely and finally determined either those controversies or the wider controversy of which they form part. It would mean that this Court had failed to avoid a multiplicity of legal proceedings. The "matters in controversy" referred to in the concluding words of s 32 are not limited to the "cause or matter" referred to in the opening words: they extend to matters in controversy "arising out of or connected with the cause of action". The controversy about whether the petroleum defendants and the State of Queensland should pay the costs of the plaintiffs in the Federal Court and the Full Court is "connected with the cause of action", and the disposition of it in the Federal Court and the Full Court, in relation to which the plaintiffs applied for certiorari in this Court. Hence, the petroleum defendants and the State of Queensland should pay the costs of the plaintiffs of the proceedings in the Federal Court and the Full Court. Conclusion on costs. In summary, then, the petroleum defendants and the State of Queensland must pay the costs of the plaintiffs in the Federal Court of Australia occasioned by the applications of the petroleum defendants and the State of Queensland for summary dismissal, the plaintiffs' costs of the application for leave to appeal to the Full Court against the orders of the Federal Court of Australia made on 18 December 2009 and 17 March 2010, and the plaintiffs' costs in this Court. The effect of the grant of certiorari will be to quash the costs orders against the plaintiffs in favour of the petroleum defendants made by the Federal Court and the Full Court.

HIGH COURT OF AUSTRALIA AND APPELLANT PARSONS & ORS RESPONDENTS [2019] HCA 21 19 June 2019 ORDER Appeal allowed. Set aside orders 2, 3, 4 and 8 made by the Full Court of the Family Court of Australia dated 28 June 2018 and, in their place, order that appeal number EA 111 of 2017 be dismissed. The first and second respondents pay the appellant's costs of the appeal to this Court. On appeal from the Family Court of Australia Representation M P Kearney SC and C L Lenehan with E A Lawson and D P Hume for the appellant (instructed by Steiner Legal) B W Walker SC with M McMahon and J S Stellios for the first and second respondents (instructed by McDonald Johnson Lawyers) S B Lloyd SC with S M Christie SC and P D Herzfeld for the third respondent (instructed by Legal Aid NSW) S P Donaghue QC, Solicitor-General of the Commonwealth, with B K Lim for the Attorney-General of the Commonwealth, intervening (instructed by Australian Government Solicitor) R M Doyle SC with F I Gordon for the Attorney-General for the State of Victoria, intervening (instructed by Victorian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Constitutional law (Cth) – Courts – Federal courts – Federal jurisdiction – Matter arising under Commonwealth law – Where Commonwealth law provides rules in respect of parentage of children born of artificial conception procedures – Where State law provides irrebuttable presumption that biological father of child conceived by fertilisation procedure is not father in specified circumstances – Whether s 79(1) of Judiciary Act 1903 (Cth) operates to pick up and apply text of State law as Commonwealth law – Whether State law regulates exercise of jurisdiction – Whether Commonwealth law has "otherwise provided" within meaning of s 79(1) of Judiciary Act – Whether tests for contrariety under s 79(1) of Judiciary Act and s 109 of Constitution identical – Whether State law applies of its own force in federal jurisdiction. Family law – Parenting orders – Meaning of "parent" – Where Family Law Act 1975 (Cth) presumes best interests of child served by shared parental responsibility – Where s 60H of Family Law Act provides rules in respect of parentage of children born of artificial conception procedures – Where appellant provided semen to first respondent to conceive child with belief that he was fathering child – Where appellant had ongoing role in child's financial support, health, education and general welfare and enjoyed extremely close and secure attachment relationship with child – Where first respondent later in de facto relationship with second respondent – Where appellant found to be "parent" within ordinary meaning of word but not under s 60H – Whether s 60H exhaustive of persons who may qualify as "parent" of child born of artificial conception procedure – Whether "parent" used in Family Law Act according to ordinary meaning except as otherwise provided – Whether appellant is "parent" within ordinary meaning – Whether ordinary meaning of "parent" excludes "sperm donor" – Whether appellant is "sperm donor". Words and phrases – "artificial conception procedure", "complete upon its face", jurisdiction", "implicit negative proposition", "federal courts", "federal "inconsistency", "irrebuttable presumption", "jurisdiction", "matter", "ordinary meaning", "otherwise provided", "parent", "parentage", "parenting orders", "picked up and applied", "power", "presumptions", "regulates the exercise of jurisdiction", "sperm donor", "State jurisdiction", "State legislative power", "status". Constitution, s 109. Family Law Act 1975 (Cth), ss 4, 60B, 60EA, 60G, 60H, 61D, 61DA. Judiciary Act 1903 (Cth), s 79(1). Status of Children Act 1996 (NSW), Pt 3 Div 1. KIEFEL CJ, BELL, GAGELER, KEANE, NETTLE AND GORDON JJ. The principal issue for determination in this appeal is whether s 79(1) of the Judiciary Act 1903 (Cth) picks up ss 14(2) and 14(4) of the Status of Children Act 1996 (NSW) and applies them to applications for parenting orders made under Pt VII of the Family Law Act 1975 (Cth), with the result that the appellant is irrefutably to be presumed not to be the father of his biological daughter. For the reasons which follow, that question should be answered: "no". Section 79(1) of the Judiciary Act applies where there is a gap in the law governing the exercise of federal jurisdiction by picking up State laws which regulate the exercise of State jurisdiction and applying them as Commonwealth laws governing the exercise of federal jurisdiction. As will be explained, ss 14(2) and 14(4) of the Status of Children Act are not provisions that regulate the exercise of jurisdiction. Nor is there any gap in the law governing the exercise of the Family Court's jurisdiction to make parenting orders under the Family Law Act. Part VII of the Family Law Act provides comprehensively for how the Family Court is to determine who is a parent. There is also a question of whether ss 14(2) and 14(4) of the Status of Children Act are valid laws applying of their own force to applications for parenting orders made under Pt VII of the Family Law Act as part of the single though composite body of law in Australia. For the reasons which follow, that question should also be answered: "no". The facts The appellant and the first respondent were close friends for many years. In 2006, the appellant provided his semen to the first respondent in order that she might artificially inseminate herself and as a result conceive a child, which she did. At the time of conception, the appellant believed that he was fathering the child and that he would, as the child's parent, support and care for her. His name was entered on the child's birth certificate as her father. Although the child thereafter lived with the first respondent and the second respondent, who is the first respondent's female partner, the appellant took his relationship with his child seriously. He had and continues to have an ongoing role in her financial support, health, education and general welfare, and he enjoys what the primary judge described as an extremely close and secure attachment relationship with the child. By 2015, the first and second respondents resolved to relocate from this country to New Zealand and to take the child with them. The appellant responded by instituting proceedings in the Family Court of Australia for orders, Bell Nettle Gordon inter alia, conferring shared parental responsibility between himself and the first and second respondents; restraining relocation of the child from the child's current area of residence in Australia; providing for the child to spend time with the appellant in a fortnightly cycle, five nights per fortnight, half school holidays and other special times; and addressing specific issues including overseas travel and communication. Relevant statutory provisions (i) Family Law Act Parenting orders are made under Pt VII of the Family Law Act1. Division 2 of Pt VII of the Family Law Act deals with "the concept of parental responsibility"2. Section 61D(1) provides, in substance, that a parenting order confers parental responsibility for a child on a person to the extent that the order confers on that person duties, powers, responsibilities or authority in relation to the child. Section 61DA provides, in substance, and so far as is relevant, that, when making a parenting order in relation to a child, the court must apply a rebuttable presumption that it is in the best interests of the child for the child's parents to have equal shared parental responsibility for the child. Subdivision B of Div 1 of Pt VII, which is headed "[o]bject, principles and outline", provides, inter alia, in s 60B(1) that the objects of Pt VII include "ensuring that children have the benefit of both of their parents having a meaningful involvement in their lives, to the maximum extent consistent with the best interests of the child" (emphasis added). Subdivision D of Div 1 of Pt VII is comprised of six sections – ss 60EA to 60HB – which are described in s 60A(c) as "relevant to how this Act applies to certain children". Section 60F provides that a child of a marriage is a child of both parties to the marriage whether born in or out of wedlock or, where the child is adopted, the child is adopted after the marriage by the parties to the marriage 1 Family Law Act 1975 (Cth), s 64B(1) and (2). 2 Family Law Act, s 61A. Bell Nettle Gordon or by one of them with the consent of the other. Section 60G provides for the granting of leave to bring adoption proceedings. Section 60H provides rules in respect of the parentage of children born of artificial conception procedures. "[A]rtificial conception procedure" is defined by s 4(1) as including artificial insemination and the implantation of an embryo in the body of a woman. The terms of s 60H are as follows: "Children born as a result of artificial conception procedures a child is born to a woman as a result of the carrying out of an artificial conception procedure while the woman was married to, or a de facto partner of, another person (the other intended parent); and either: the woman and the other intended parent consented to the carrying out of the procedure, and any other person who provided genetic material used in the procedure consented to the use of the material in an artificial conception procedure; or under a prescribed law of the Commonwealth or of a State or Territory, the child is a child of the woman and of the other intended parent; then, whether or not the child is biologically a child of the woman and of the other intended parent, for the purposes of this Act: the child is the child of the woman and of the other intended parent; and if a person other than the woman and the other intended parent provided genetic material – the child is not the child of that person. Bell Nettle Gordon a child is born to a woman as a result of the carrying out of an artificial conception procedure; and under a prescribed law of the Commonwealth or of a State or Territory, the child is a child of the woman; then, whether or not the child is biologically a child of the woman, the child is her child for the purposes of this Act. a child is born to a woman as a result of the carrying out of an artificial conception procedure; and under a prescribed law of the Commonwealth or of a State or Territory, the child is a child of a man; then, whether or not the child is biologically a child of the man, the child is his child for the purposes of this Act. (5) For the purposes of subsection (1), a person is to be presumed to have consented to an artificial conception procedure being carried out unless it is proved, on the balance of probabilities, that the person did not consent. In this section: this Act includes: the standard Rules of [the Family] Court; and the related Federal Circuit Court Rules." Section 60HA provides rules in respect of the parentage of children of de facto partners. Section 60EA in substance defines a "de facto partner" of a person as another person (whether of the same or a different sex) with whom the person is in a relationship, if the relationship is registered as such under a prescribed State or Territory law or if the relationship is as a couple living together on a genuine domestic basis. So far as is relevant, s 60HA is as follows: Bell Nettle Gordon "Children of de facto partners (1) For the purposes of this Act, a child is the child of a person who has, or had, a de facto partner if: child the person's de facto partner; or child of the person and the child the the person's de facto partner or by either of them with the consent of the other; or adopted by the person and the child is, under subsection 60H(1) or section 60HB, a child of the person and the person's de facto partner. This subsection has effect subject to subsection (2). (2) A child of current or former de facto partners ceases to be a child of those partners for the purposes of this Act if the child is adopted by a person who, before the adoption, is not a prescribed adopting parent. Section 60HB provides, in relation to children born under surrogacy arrangements, in substance, that if a court has made an order under a prescribed law of a State to the effect that a child is the child of one or more persons or each of one or more persons is a parent of a child, the child is the child of each of those persons for the purposes of the Family Law Act. Division 12 of Pt VII of the Family Law Act, which is headed "[p]roceedings and jurisdiction", provides, in Subdiv D, for "[p]resumptions of parentage" and, in Subdiv E, for "[p]arentage evidence". The presumptions of parentage prescribed in Subdiv D are as follows: In s 69P, a presumption in substance that a child born to a woman while she is married is a child of the woman and her husband. In s 69Q, a presumption in substance that a child born to a woman who was cohabiting with a man between 44 and 20 weeks before the child's birth is a child of the man. Bell Nettle Gordon In s 69R, a presumption that a person whose name is entered as a parent of a child in a register of births or parentage information kept under a law of the Commonwealth or of a State, Territory or prescribed overseas jurisdiction is a parent of the child. In s 69S, a presumption in substance that a person expressly found to be a parent of a child by one of a number of specified courts is the parent of the child if the finding has not been altered, set aside or reversed. In s 69T, a presumption of paternity arising from the execution by a man, under the law of the Commonwealth, a State or Territory or a prescribed overseas jurisdiction, of an instrument acknowledging that he is the father of a specified child. Section 69U, which is the last section in Subdiv D of Div 12, provides for the rebuttal of presumptions and other matters as follows: "(1) A presumption arising under this Subdivision is rebuttable by proof on a balance of probabilities. (2) Where: 2 or more presumptions arising under this Subdivision are relevant in any proceedings; and those presumptions, or some of those presumptions, conflict with each other and are not rebutted in the proceedings; the presumption that appears to the court to be the more or most likely to be correct prevails. (3) This section does not apply to a presumption arising under subsection 69S(1)." (ii) Status of Children Act Section 21 of the Status of Children Act provides for applications to the Supreme Court of New South Wales for a declaration of parentage under that section. Division 1 of Pt 3 of the Status of Children Act, which is headed "[p]arentage presumptions", provides for presumptions, in some respects similar Bell Nettle Gordon to the presumptions provided for in Div 12 of Pt VII of the Family Law Act, but in other respects different, as follows: In s 9, a presumption, comparable to the presumption provided for in s 69P of the Family Law Act, of parentage arising from marriage. In s 10, a presumption, comparable to the presumption provided for in s 69Q of the Family Law Act, of parentage arising from cohabitation. In s 11, a presumption, comparable to the presumption provided for in s 69R of the Family Law Act, of parentage arising from registration of birth. In s 12, a presumption, comparable to s 69S of the Family Law Act, of parentage arising from findings of courts. In s 13, a presumption, comparable to s 69T of the Family Law Act, of parentage arising from acknowledgments. In s 14, a presumption of parentage arising out of use of fertilisation procedures. The last-mentioned presumption is as follows: "Presumptions of parentage arising out of use of fertilisation procedures (1) When a woman who is married to a man has undergone a fertilisation procedure as a result of which she becomes pregnant: her husband is presumed to be the father of any child born as a result of the pregnancy even if he did not provide any or all of the sperm used in the procedure, but only if he consented to the procedure, and the woman is presumed to be the mother of any child born as a result of the pregnancy even if she did not provide the ovum used in the procedure. Bell Nettle Gordon (1A) When a woman who is married to or who is the de facto partner of another woman has undergone a fertilisation procedure as a result of which she becomes pregnant: the other woman is presumed to be a parent of any child born as a result of the pregnancy, but only if the other woman consented to the procedure, and the woman who has become pregnant is presumed to be the mother of any child born as a result of the pregnancy even if she did not provide the ovum used in the procedure. Note. 'De facto partner' is defined in section 21C of the Interpretation Act 1987. If a woman (whether married or unmarried) becomes pregnant by means of a fertilisation procedure using any sperm obtained from a man who is not her husband, that man is presumed not to be the father of any child born as a result of the pregnancy. If a woman (whether married or unmarried) becomes pregnant by means of a fertilisation procedure using an ovum obtained from another woman, that other woman is presumed not to be the mother of any child born as a result of the pregnancy. This subsection does not affect the presumption arising under subsection (1A)(a). (4) Any presumption arising under subsections (1)-(3) is irrebuttable. In any proceedings in which the operation of subsection (1) is relevant, a husband's consent to the carrying out of the fertilisation procedure is presumed. (5A) In any proceedings in which the operation of subsection (1A) is relevant, the consent of a woman to the carrying out of a fertilisation procedure that results in the pregnancy of her spouse or de facto partner is presumed. In this section: a reference to a woman who is married to a man includes a reference to a woman who is the de facto partner of a man, and Bell Nettle Gordon a reference (however expressed) to the husband or wife of a person: is, in a case where the person is the de facto partner of a person of the opposite sex, a reference to that other person, and does not, in that case, include a reference to the spouse (if any) to whom the person is actually married." Section 15 provides, in substance, that every presumption arising under Div 1 of Pt 3, except for the presumptions arising under ss 12(1) and 14(1)-(3), is rebuttable by proof on the balance of probabilities. Section 16 provides, in substance, that, if two or more rebuttable presumptions conflict with each other, and are not rebutted in any proceedings, "the presumption that appears to the court to be more or most likely to be correct prevails". Section 17 provides, in substance, that, if two or more irrebuttable presumptions conflict with each other, "the presumption that appears to the court to be more or most likely to be correct prevails"; and that, if any irrebuttable presumption conflicts with a rebuttable presumption that is not rebutted in any proceedings, the irrebuttable presumption prevails. Section 18 provides, in substance, that a prosecutor cannot rely on a presumption arising under the Status of Children Act to prove in criminal proceedings the parentage of a child. (iii) Judiciary Act Section 79(1) of the Judiciary Act provides as follows: "The laws of each State or Territory, including the laws relating to procedure, evidence, and the competency of witnesses, shall, except as otherwise provided by the Constitution or the laws of the Commonwealth, be binding on all Courts exercising federal jurisdiction in that State or Territory in all cases to which they are applicable." Bell Nettle Gordon The proceedings at first instance At first instance, there was no question that the first respondent, being the biological and birth mother of the child, was a parent of the child. The issue was whether the appellant or the second respondent was a legal parent of the child. The primary judge, Cleary J, found that the first and second respondents were not partners in a de facto relationship when the child was conceived. It followed, as her Honour held, that the requirements of s 60H(1)(a) of the Family Law Act were not satisfied, with the result that s 60H was not engaged, and, therefore, that the second respondent "does not meet the legislative requirement to be the other intended parent". It does not appear to have been contended that the second respondent qualified as a parent of the child on any basis other than s 60H. By contrast, although it was recognised that the appellant did not qualify as a parent under s 60H, it was contended that he qualifies as a parent otherwise than under that provision. The primary judge accepted that contention. Following the reasoning of Cronin J in Groth v Banks3, her Honour held that s 60H is properly to be understood "as expanding rather than restricting the categories of people who can be parents", and, in effect, that, in circumstances where s 60H is not engaged, a person may yet qualify as a parent of a child born as a result of an artificial conception procedure if the person is a parent of the child within "the ordinary meaning of the word". Her Honour further held that, because the appellant is the biological father of the child and, unaware of any de facto relationship between the first and second respondents, provided his genetic material for the express purpose of fathering a child whom he expected to help parent by financial support and physical care, which he had since done, the appellant is a parent of the child within the ordinary meaning of the word "parent" and, therefore, a parent of the child for the purposes of the Family Law Act. The proceedings before the Full Court On appeal to the Full Court of the Family Court, Thackray J, with whom Murphy and Aldridge JJ agreed, held that the appellant is not a parent of the child. Like the primary judge, Thackray J accepted that s 60H is not exhaustive. (2013) 49 Fam LR 510. Bell Nettle Gordon But, contrary to the primary judge's reasoning, Thackray J held that, because the matter was one within federal jurisdiction, s 79 of the Judiciary Act picked up s 14 of the Status of Children Act and applied it as a law of the Commonwealth, and that, perforce of s 14 of the Status of Children Act as so picked up and applied, the appellant was to be irrebuttably presumed not to be the parent of the child. The meaning of "parent" and s 60H of the Family Law Act The primary judge and the Full Court were correct in holding that s 60H is not exhaustive of the persons who may qualify as a parent of a child born as a result of an artificial conception procedure. Although the Family Law Act contains no definition of "parent" as such, a court will not construe a provision in a way that departs from its natural and ordinary meaning unless it is plain that Parliament intended it to have some different meaning4. Here, there is no basis in the text, structure or purpose of the legislation to suppose that Parliament intended the word "parent" to have a meaning other than its natural and ordinary meaning. To the contrary, s 4(1) provides that, when used in Pt VII, "parent", "in relation to a child who has been adopted, means an adoptive parent of the child". That implies that there is an accepted meaning of "parent" which, but for the express inclusion of an adoptive parent, would or might not extend to an adoptive parent5. Section 61B, which defines "parental responsibility" by reference to the legal duties, powers, responsibilities and authority of parents; s 69V, which provides for evidence of parentage; and s 69W, which provides for orders for 4 See, eg, Cody v J H Nelson Pty Ltd (1947) 74 CLR 629 at 647 per Dixon J; [1947] HCA 17; Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation (1981) 147 CLR 297 at 305 per Gibbs CJ, 310 per Stephen J, 321 per Mason and Wilson JJ, 335 per Aickin J; [1981] HCA 26; Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27 at 31 [4] per French CJ, 46-47 [47] per Hayne, Heydon, Crennan and Kiefel JJ; [2009] HCA 41; Esso Australia Pty Ltd v Australian Workers' Union (2017) 92 ALJR 106 at 123 [52] per Kiefel CJ, Keane, Nettle and Edelman JJ; 350 ALR 404 at 422-423; [2017] HCA 54; Maunsell v Olins [1975] AC 373 at 382 per Lord Reid. 5 See Dilworth v Commissioner of Stamps [1899] AC 99 at 105-106 per Lord Watson for the Privy Council; Corporate Affairs Commission (SA) v Australian Central Credit Union (1985) 157 CLR 201 at 206-207 per Mason A-CJ, Wilson, Deane and Dawson JJ; [1985] HCA 64. Bell Nettle Gordon carrying out parentage testing procedures, are also consistent with a statutory conception of parentage which accords to ordinary acceptation. Section 60B(1) perhaps suggests that a child cannot have more than two parents within the meaning of the Family Law Act. But whether or not that is so, s 60B(1) is not inconsistent with a conception of parent which, in the absence of contrary statutory provision, accords to ordinary acceptation: hence, as it appears, the need for the express provision in s 60H(1)(d) that, where a child is born to a woman as a result of an artificial conception procedure while the woman is married to or a de facto partner of an "other intended parent", a person other than the woman and intended partner who provides genetic material for the purposes of the procedure is not the parent of the child. So to conclude does not mean that the only persons who, by law, have parental responsibilities are persons who are parents according to ordinary acceptation or are otherwise defined in the Family Law Act as parents. And it does not mean that the only persons who may seek parenting orders under s 61D are parents according to ordinary acceptation or are otherwise defined as parents. The range of permissible applicants is broader than that. But it is implicit in each of the provisions that have been mentioned that the Family Law Act proceeds from the premise that the word "parent" refers to a parent within the ordinary meaning of that word except when and if an applicable provision of the Family Law Act otherwise provides. It is true, as counsel for the first and second respondents submitted, that s 5(1) of the Child Support (Assessment) Act 1989 (Cth) defines "parent", when used in relation to a child born because of the carrying out of an artificial conception procedure, as "a person who is a parent of the child under section 60H of the Family Law Act". In counsel's submission, that suggests that the drafter of the Child Support (Assessment) Act took s 60H of the Family Law Act to be exhaustive of the persons who are parents of a child born of an artificial conception procedure. That, however, is unlikely. It is more probable that the Child Support (Assessment) Act adopts an explicit definition of "parent" because it is an Act which imposes an enforceable pecuniary liability6. And even if it were otherwise, an Act of Parliament does not alter the law by merely betraying 6 See Luton v Lessels (2002) 210 CLR 333 at 356-358 [65]-[67] per Gaudron and Hayne JJ; [2002] HCA 13. Bell Nettle Gordon an erroneous opinion of it7. It may be that, where the interpretation of a statute is obscure or ambiguous or readily capable of more than one interpretation, the meaning ascribed to it in a subsequent statute may provide some insight8. But that is not this case. The meaning of s 60H is not obscure or ambiguous or readily capable of more than one interpretation. As both the primary judge and the Full Court held, its effect is plainly enough to expand rather than restrict the categories of people who may qualify as a parent of a child born as a result of an artificial conception procedure. legislation is unnecessary In In re G (Children), Baroness Hale of Richmond observed9 in relation to comparable English to English contemporary that, according conceptions of parenthood, "[t]here are at least three ways in which a person may be or become a natural parent of a child" depending on the circumstances of the particular case: genetically, gestationally and psychologically. That may also be true of the ordinary, accepted English meaning of "parent" in this country, issue. although The significance of her Ladyship's analysis for present purposes, however, is that, just as the question of parentage under the legislation with which she was concerned was one of fact and degree to be determined by applying contemporary conceptions of parenthood to the relevant circumstances, the question of whether a person qualifies under the Family Law Act as a parent according to the ordinary, accepted English meaning of "parent" is a question of fact and degree to be determined according to the ordinary, contemporary Australian understanding of "parent" and the relevant circumstances of the case at hand. The primary judge and the Full Court were correct so to hold. to reach a concluded view on that 7 Deputy Federal Commissioner of Taxes (SA) v Elder's Trustee and Executor Co Ltd (1936) 57 CLR 610 at 625-626 per Dixon, Evatt and McTiernan JJ; [1936] HCA 64, quoting Maxwell, On the Interpretation of Statutes, 6th ed (1920) at 544. See also Pearce and Geddes, Statutory Interpretation in Australia, 8th ed (2014) at 8 Ormond Investment Co v Betts [1928] AC 143 at 164 per Lord Atkinson. [2006] 1 WLR 2305 at 2316-2317 [33]-[37]; [2006] 4 All ER 241 at 252-253. Bell Nettle Gordon Section 79 of the Judiciary Act As was explained in Rizeq v Western Australia10, the purpose of s 79(1) of the Judiciary Act is to fill a gap in the laws which regulate matters coming before courts exercising federal jurisdiction by providing those courts with powers necessary for the hearing and determination of those matters. In the case of a State court exercising federal jurisdiction (as in Rizeq), or a federal court exercising federal jurisdiction (as in this case), such a gap exists by reason of the absence of State legislative power to command a court as to the manner of its exercise of federal jurisdiction. In such cases, s 79(1) fills the gap by picking up the texts of State laws governing the manner of exercise of State jurisdiction and applying them as Commonwealth laws governing the manner of exercise of federal jurisdiction. But, as was stressed in Rizeq11, s 79(1) of the Judiciary Act has no broader operation than that. In particular, s 79(1) is not directed to, and it does not add to or subtract from, laws which are determinative of the rights and duties of persons as opposed to the manner of exercise of jurisdiction12. In Rizeq, the accused was indicted before the District Court of Western Australia on two counts of offences against s 6(1)(a) of the Misuse of Drugs Act 1981 (WA). Because he was a resident of New South Wales, his trial before the District Court of Western Australia was a trial in the exercise of federal diversity jurisdiction under s 75(iv) of the Constitution. Section 114(2) of the Criminal Procedure Act 2004 (WA) was a law which regulated the exercise of State jurisdiction by providing that, in the case of offences of the kind with which the accused was charged, a majority verdict of guilty returned by not less than 11 jurors was sufficient to sustain a conviction. Because the Parliament of Western Australia lacks legislative power to command a State court exercising federal jurisdiction as to the manner of exercise of its jurisdiction, s 114(2) of the Criminal Procedure Act was incapable of applying of its own force. That left a gap in the laws regulating the trial, to which s 79(1) of the Judiciary Act responded by picking up the text of s 114(2) of the Criminal Procedure Act and 10 (2017) 262 CLR 1 at 14 [15]-[16], 18 [32] per Kiefel CJ, 36 [90], 41 [103] per Bell, Gageler, Keane, Nettle and Gordon JJ; [2017] HCA 23. 11 (2017) 262 CLR 1 at 41 [103] per Bell, Gageler, Keane, Nettle and Gordon JJ. 12 Rizeq (2017) 262 CLR 1 at 41 [105] per Bell, Gageler, Keane, Nettle and Bell Nettle Gordon applying it as a law of the Commonwealth governing the conduct of the trial13. By contrast, s 6(1)(a) of the Misuse of Drugs Act was a law addressed to the conduct of individuals (rendering them liable for prosecution for criminal offences) and thus was determinative of the rights and duties of persons as opposed to the manner of exercise of jurisdiction. As such, as was held in Rizeq14, s 6(1)(a) was beyond the operation of s 79(1) of the Judiciary Act but it applied of its own force as a law of the State of Western Australia under which the accused was charged. Section 14(2) of the Status of Children Act As has been noticed15, Div 1 of Pt 3 of the Status of Children Act is As Professor Thayer long ago expressed in terms of "presumptions". demonstrated16, however, the word "presumption" is applied to a disparate range of distinctive legal techniques and doctrines. A presumption of fact, or evidentiary presumption, is a traditional inference, based on logic and common sense, which a tribunal of fact ordinarily draws from basic facts, particularly circumstantial evidence17. By contrast, a presumption of law is a legal rule that gives additional force to some basic facts in the proof of the presumed fact, by permitting or requiring an inference from the former to the latter18. If a presumption of the latter kind is rebuttable and so merely facilitates proof of the presumed fact, it is properly to be conceived of as a rule of law "relating to 13 Rizeq (2017) 262 CLR 1 at 16 [23] per Kiefel CJ, 20 [42], 41 [104] per Bell, Gageler, Keane, Nettle and Gordon JJ. 14 (2017) 262 CLR 1 at 41 [105] per Bell, Gageler, Keane, Nettle and Gordon JJ. 15 See [15] above. 16 Thayer, "Presumptions and the Law of Evidence" (1889) 3 Harvard Law Review 141; Thayer, A Preliminary Treatise on Evidence at the Common Law (1898), ch 8. See also Tapper, Cross and Tapper on Evidence, 12th ed (2010) at 134. 17 R v Falconer (1990) 171 CLR 30 at 83 per Gaudron J; [1990] HCA 49. See Heydon, Cross on Evidence, 11th Aust ed (2017) at 368 [7255]. 18 See Bohlen, "The Effect of Rebuttable Presumptions of Law upon the Burden of Proof" (1920) 68 University of Pennsylvania Law Review 307 at 312. Bell Nettle Gordon evidence"19, and so, generally speaking, as a law capable of being picked up by s 79(1) of the Judiciary Act. If, however, a presumption of the latter kind is conclusive, and so requires an inference regardless of any competing evidence, logic or common sense, its effect will be to alter a rule that would otherwise attach legal consequences to the presumed fact, as opposed to the basic facts20. And if the rule that attaches legal consequences to the presumed fact is directed to the status, rights and duties of persons, so, too, must be the conclusive presumption of law which effects its alteration. The presumptions identified in Div 1 of Pt 3 of the Status of Children Act are rules of law that apply upon proof of their stated factual premises. As has been seen21, except for the presumptions arising under ss 12(1) and 14(1)-(3), they are also stated to be "rebuttable presumptions", and they otherwise present as rules of law relating to evidence22. Generally speaking, therefore, it may be that they are capable of being picked up by s 79(1) of the Judiciary Act and applied in the exercise of federal jurisdiction as laws of the Commonwealth. By contrast, the presumptions stated in ss 12(1) and 14(1)-(3) of the Status of Children Act23 are "irrebuttable" rules determinative of a status to which rights and duties are attached24. In particular, ss 14(2) and 14(4) of the Status of Children Act operate as an irrebuttable rule of law that, in specified circumstances, the biological father of a child born as a result of a fertilisation procedure is not the father of the child. That is not a law relating to evidence or otherwise regulating the exercise of jurisdiction. It is a rule of law determinative of parental status which applies independently of anything done by a court or 19 See Roberts and Zuckerman, Criminal Evidence, 2nd ed (2010) at 233. 20 See and compare Williamson v Ah On (1926) 39 CLR 95 at 108, 117 per Isaacs J; [1926] HCA 46. 21 See [17] above. 22 See and compare Harris v Harris [1979] 2 NSWLR 252 at 255 per McLelland J. 23 Like the provisions of the Artificial Conception Act 1984 (NSW) which were their legislative predecessors. 24 See Ford v Ford (1947) 73 CLR 524 at 529 per Latham CJ; [1947] HCA 7. Bell Nettle Gordon other tribunal, and which, as such, stands in contrast to a provision that regulates the exercise of jurisdiction. Counsel for the first and second respondents submitted to the contrary that s 18 of the Status of Children Act, by precluding reliance on presumptions in criminal prosecutions, indicates that the presumption laid down in ss 14(2) and 14(4) is "procedural" and, as such, capable of being picked up and applied by s 79(1) of the Judiciary Act. The argument is unpersuasive. Section 18 may be understood as creating a limited exception to the operation of the rule of law in ss 14(2) and 14(4). It mirrors the common law rule that, when the liberty of the subject is at stake, there is no room for presumptions in favour of the Crown25. But it says nothing, one way or the other, as to the nature of the presumptions to which it applies. Counsel for the first and second respondents also referred to s 17(1) of the Status of Children Act, which provides for the resolution of conflicts between irrebuttable presumptions in favour of the presumption that appears more or most likely to be correct. Relying on that provision, counsel submitted that the presumption prescribed by ss 14(2) and 14(4) is, in truth, rebuttable, and, in any event, because of the need for judicial resolution, it is "procedural" and, therefore, capable of being picked up and applied by s 79(1) of the Judiciary Act. Those submissions are also unpersuasive. The only other irrebuttable presumption in Div 1 of Pt 3 of the Status of Children Act is the presumption stated in s 12(1) that a person is a child's parent if, while the person is alive, a prescribed court has found expressly that the person is the child's parent or made a finding that it could not have made unless the person were the child's parent, and the finding has not been altered, set aside or reversed. The possibility of conflict between those two provisions does not suggest that the presumption in ss 14(2) and 14(4) is anything other than an irrebuttable rule of law. Possibly, a prescribed court could make a declaration of parentage of a child in favour of a person who is deemed by ss 14(2) and 14(4) not to be the father of the child, and if so, and if parentage were thereafter put in issue, it would fall to the Supreme Court of New South Wales to decide whether the prescribed court's declaration of parentage or ss 14(2) and 14(4)'s denial of fatherhood was "more or most 25 Dillon v The Queen [1982] AC 484 at 487 per Lord Fraser of Tullybelton for the Privy Council. See Heydon, Cross on Evidence, 11th Aust ed (2017) at 373 Bell Nettle Gordon likely to be correct". For that reason, although the presumption prescribed by ss 14(2) and 14(4) is rightly termed "irrebuttable", it is also properly described as conditional. But either way, it is not a rebuttable presumption of law – because it is not rebuttable by evidence or other proof of competing facts. It is a rule of law which is subject to a further rule of law that, where there is apparent conflict between two rules of law, the one which the court determines to be more or most correct shall prevail. Such rules are well known to the law26. Finally on this aspect of the matter, it is to be observed that ss 14(2) and 14(4) stand in contrast to provisions such as, for example, s 4 of the Civil Liability (Third Party Claims Against Insurers) Act 2017 (NSW), which, although determinative of rights and obligations, are directed to the manner of exercise of jurisdiction27. Section 4 of the Civil Liability (Third Party Claims Against Insurers) Act governs the exercise of State jurisdiction in relation to claims against defendants who are indemnified under policies of insurance against civil liabilities by providing for claimants to bring claims directly against defendants' insurers. If such a claim is brought in a court exercising federal jurisdiction, as it might be perhaps as part of the whole of the matters in controversy in a proceeding before the Federal Court of Australia, s 79(1) of the Judiciary Act would pick up and apply s 4 of the Civil Liability (Third Party Claims Against Insurers) Act – as a Commonwealth law governing the manner of exercise of federal jurisdiction – in order to fill the gap in the Federal Court's powers to deal with such a claim28. In contrast, the "irrebuttable presumption" laid down in ss 14(2) and 14(4) is not in its nature a law relating to evidence or otherwise regulating the exercise of jurisdiction. It is a conditional rule of law determinative of the parental status of the persons to whom it applies which operates independently of anything done 26 See Bankstown City Council v Alamdo Holdings Pty Ltd (2005) 223 CLR 660 at 668-669 [27]; [2005] HCA 46; Leeming, Resolving Conflicts of Laws (2011) at 27 See Rizeq (2017) 262 CLR 1 at 33-34 [83], 39-40 [100] per Bell, Gageler, Keane, Nettle and Gordon JJ, referring to R v Commonwealth Court of Conciliation and Arbitration; Ex parte Barrett (1945) 70 CLR 141 at 165-166 per Dixon J; [1945] HCA 50 and James Hardie & Coy Pty Ltd v Seltsam Pty Ltd (1998) 196 CLR 53 at 64-65 [22]-[24] per Gaudron and Gummow JJ; [1998] HCA 78. 28 Rizeq (2017) 262 CLR 1 at 36 [90] per Bell, Gageler, Keane, Nettle and Gordon JJ. Bell Nettle Gordon by a court or other tribunal. As such, ss 14(2) and 14(4) are not provisions to which s 79(1) of the Judiciary Act is capable of applying. The Family Law Act has "otherwise provided" The appellant contended that, even if s 14(2) is properly to be conceived of as a provision which regulates the exercise of State jurisdiction in matters arising under the Status of Children Act, it is incapable of being picked up by s 79(1) of the Judiciary Act and applied as a law of the Commonwealth in proceedings under the Family Law Act because the Family Law Act has "otherwise provided". What has been said thus far is sufficient to dispose of the appeal. But it is appropriate to acknowledge the correctness of that submission. If ss 14(2) and 14(4) were properly to be conceived of as provisions which regulate the exercise of State jurisdiction, they could not be picked up and applied under s 79(1) of the Judiciary Act because the Family Law Act has otherwise provided. In coming to that conclusion, there is but little assistance to be derived from principles for resolving conflicts between statutes having the same source29. Those principles proceed from the assumption that a legislature generally does not "intend to contradict itself"30, and require conflicts to be "alleviated, so far as possible, by adjusting the meaning of the competing provisions"31 through familiar methods. By contrast, as counsel for the appellant submitted, s 79(1) anticipates State laws regulating the exercise of State jurisdiction which, if picked up and applied in federal jurisdiction, would contradict laws enacted by the Commonwealth Parliament32. Where that is so, the State law is not picked up 29 cf Northern Territory v GPAO (1999) 196 CLR 553 at 588 [80] per Gleeson CJ and Gummow J; [1999] HCA 8. 30 Butler v Attorney-General (Vict) (1961) 106 CLR 268 at 276 per Fullagar J; [1961] HCA 32. 31 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 382 [70] per McHugh, Gummow, Kirby and Hayne JJ; [1998] HCA 28, applied in Re Maritime Union of Australia; Ex parte CSL Pacific Shipping Inc (2003) 214 CLR 397 at 411-412 [28]-[29]; [2003] HCA 43. 32 See Hill and Beech, "'Picking up' State and Territory Laws under s 79 of the Judiciary Act – Three Questions" (2005) 27 Australian Bar Review 25 at 38. Bell Nettle Gordon and applied as a law having its source in Commonwealth legislative power because the law of the Commonwealth has "otherwise provided". And, as submitted on behalf of the Commonwealth Attorney-General (intervening), the meaning of such a State law cannot be adjusted in order to avoid the inconsistency33. Further, as was explained34 in Rizeq, s 79(1) of the Judiciary Act operates only in the area of exclusive Commonwealth legislative power which comprises the regulation of the exercise of federal jurisdiction, and thus in which s 109 of the Constitution necessarily has no application. Acknowledging this to be so, there is no reason to construe "otherwise provided" in s 79(1) of the Judiciary Act as importing a more stringent test than the terms of s 109 of the Constitution, within their respective spheres of application35. The coherence of the body of law applicable in federal jurisdiction is maximised by treating the test for contrariety between Commonwealth and State laws applied to regulate the exercise of federal jurisdiction as identical to that between Commonwealth and State laws operating outside federal jurisdiction. The meaning of the expression "otherwise provided" in s 79(1) of the Judiciary Act is thus to be equated with the concept of inconsistency in s 109 of the Constitution. As was earlier observed, Div 1 of Pt VII of the Family Law Act proceeds from the premise that "parent" is an ordinary English word which is to be taken as having its ordinary, accepted English meaning. In some respects, most notably in s 60H, the Family Law Act may be seen as expanding the conception of "parent" beyond ordinary acceptation by adding a limited range of persons who stand in specified relationships to children born of artificial conception procedures. Additionally, under s 60G, a person may qualify as a parent of a child born of an artificial conception procedure by reason of the person's adoption of the child under the law of a State or Territory. But ss 60H and 60G 33 Rizeq (2017) 262 CLR 1 at 33 [81] per Bell, Gageler, Keane, Nettle and Gordon JJ. 34 (2017) 262 CLR 1 at 25 [60], 37 [92] per Bell, Gageler, Keane, Nettle and Gordon JJ; cf GPAO (1999) 196 CLR 553 at 576 [38] per Gleeson CJ and Gummow J (Gaudron J agreeing at 606 [135]); Agtrack (NT) Pty Ltd v Hatfield (2005) 223 CLR 251 at 271 [61]-[63] per Gleeson CJ, McHugh, Gummow, Hayne and Heydon JJ; [2005] HCA 38. 35 cf Austral Pacific Group Ltd (In liq) v Airservices Australia (2000) 203 CLR 136 at 144 [17] per Gleeson CJ, Gummow and Hayne JJ; [2000] HCA 39. Bell Nettle Gordon are not exhaustive of the classes of persons who may qualify as parents of children born of artificial conception procedures. It remains that, apart from those specific provisions, the question of whether a person is a parent of a child born of an artificial conception procedure depends on whether the person is a parent of the child according to the ordinary, accepted English meaning of "parent". And as has been explained36, that is a question of fact and degree to be determined according to the ordinary, contemporary Australian understanding of "parent" and the relevant circumstances of the case at hand. It is also necessary to appreciate, as is explained later in these reasons, that the evident purpose of s 60H and more generally of Div 1 of Pt VII of the Family Law Act is that the range of persons who may qualify as a parent of a child born of an artificial conception procedure should be no more restricted than is provided for in Div 1 of Pt VII. Consequently, although ss 60G and 60H are not exhaustive of the persons who may qualify as parents of children born of artificial conception procedures, if a person does qualify as a child's parent either under s 60G by reason of adoption, or according to s 60H, or according to ordinary acceptation of the word "parent", it is beside the point that a State or Territory provision like s 14(2) of the Status of Children Act otherwise provides. Section 79(1) of the Judiciary Act does not operate to insert provisions of State law into a Commonwealth legislative scheme which is "complete upon its face" or where, upon their proper construction, the provisions of the Commonwealth scheme can "be seen to have left no room" for the operation of State provisions37. And, as is apparent from its text, context and history, Div 1 of Pt VII of the Family Law Act leaves no room for the operation of contrary State or Territory provisions. In effect, it contains an implicit negative proposition that nothing 36 See [29] above. 37 R v Gee (2003) 212 CLR 230 at 254 [62] per McHugh and Gummow JJ; [2003] HCA 12, adopting, by analogy, the reasoning in Deputy Commissioner of Taxation v Moorebank Pty Ltd (1988) 165 CLR 55 at 64 per Mason CJ, Brennan, Deane, Dawson and Gaudron JJ; [1988] HCA 29, GPAO (1999) 196 CLR 553 at 576 [38] per Gleeson CJ and Gummow J, and Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 351 [30] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ; [1999] HCA 9. See also Bui v Director of Public Prosecutions (Cth) (2012) 244 CLR 638 at 652-653 [25] per French CJ, Gummow, Hayne, Kiefel and Bell JJ; [2012] HCA 1. Bell Nettle Gordon other than what it provides with respect to parentage is to be the subject of legislation38. The Commonwealth's legislative power under s 51(xxi) of the Constitution to legislate with respect to marriage includes power to legislate with respect to the paternity and status of children of a marriage39. The first provision of the Family Law Act to deal with assisted conception was s 5A, which was introduced by the Family Law Amendment Act 1983 (Cth)40. Like some State legislation, it provided that a husband who consented to the artificial insemination of his wife with semen obtained from another man would be deemed to be the father of the child. Unlike State legislation, however, s 5A did not provide expressly that the sperm donor was not a parent of the child. The Commonwealth lacked power under s 51(xxi) to legislate with respect to the status of children not born of a marriage41. But in 1986 and 1987, four of the States referred concurrent legislative power with respect to ex-nuptial children to the Commonwealth under s 51(xxxvii) of the Constitution42. Following referral, the Commonwealth Parliament introduced s 60B of the Family Law Act, by way of the Family Law Amendment Act 1987 (Cth), which was the legislative predecessor of the current s 60H43. Section 60B(1) was directed to married couples who conceived through artificial conception to which both parties to the 38 See and compare Agtrack (2005) 223 CLR 251 at 271 [60] per Kirby J; Momcilovic v The Queen (2011) 245 CLR 1 at 111 [244] per Gummow J; [2011] HCA 34; Work Health Authority v Outback Ballooning Pty Ltd (2019) 93 ALJR 212 at 222 [35] per Kiefel CJ, Bell, Keane, Nettle and Gordon JJ; 363 ALR 188 at 196; [2019] HCA 2. 39 Attorney-General (Vict) v The Commonwealth (1962) 107 CLR 529 at 554 per Kitto J, 564 per Taylor J, 574 per Menzies J, 602 per Owen J; [1962] HCA 37. 40 Family Law Amendment Act 1983 (Cth), s 4. 41 Russell v Russell (1976) 134 CLR 495 at 540-542 per Mason J; [1976] HCA 23. 42 See Commonwealth Powers (Family Law – Children) Act 1986 (NSW); Commonwealth Powers (Family Law – Children) Act 1986 (Vic); Commonwealth Powers (Family Law) Act 1986 (SA); Commonwealth Powers (Family Law) Act 1987 (Tas). 43 Family Law Amendment Act 1987 (Cth), s 24. Bell Nettle Gordon marriage consented, and provided that the child was the child of the couple regardless of biological parentage. Section 60B(4) made similar provision for parties to bona fide de facto relationships. Section 60B(2) and (3) provided by reference to prescribed laws of the States and Territories for children born to single women as a result of artificial conception procedures. Section 60B(2) stated that such a child was the child of the woman. Like s 5A, however, s 60B did not state that such a child was not the child of the biological father. The Family Law Reform Act 1995 (Cth) changed the focus of the legislation from parental rights to parental responsibility and provision was made for joint parenting, parenting orders, Section 60B was reconstituted as s 60H and remained silent as to the parental status of a biological father of a child born as a result of an artificial conception procedure who was not the partner of the mother. Further amendment followed in 2008 with the Family Law Amendment (De Facto Financial Matters and Other Measures) Act 2008 (Cth). It amended s 60H(1) so as to apply to the partner of a birth mother of a child regardless of the partner's sex and, for the first time, it provided that, where s 60H(1) is engaged, the biological father of the child is not the child's parent44. By contrast, however, no such provision was included in s 60H(2) or (3), and s 60H has remained in the same form until the present time. Evidently, Div 1 of Pt VII comprises a Commonwealth legislative scheme which is "complete upon its face" and thus, for the purposes of s 79(1) of the Judiciary Act, "otherwise provide[s]". residence and contact. It is true, as Victoria contended, that for a long period of Australia's history it was the States alone, and before them the colonies, which regulated the status of children, legitimacy, and the welfare of children. During the 1970s, a number of States enacted legislation governing legitimacy and maintenance of children, which included presumptions of legitimacy and paternity45. During the 1980s, that legislation was expanded to deal with the consequences of advances in the field of artificial conception, initially in terms confined to the status of children born to married women who conceived by assisted conception, but later so as to encompass children born to lesbian couples and single women. 44 Family Law Amendment (De Facto Financial Matters and Other Measures) Act 2008 (Cth), Sch 3A item 6. 45 See, eg, Children (Equality of Status) Act 1976 (NSW); Status of Children Act 1974 (Vic); Family Relationships Act 1975 (SA); Status of Children Act 1978 (Qld). Bell Nettle Gordon As Victoria submitted, there is no doubt that it was one of the purposes of those enactments to ensure that a husband who consented to the artificial insemination of his wife with semen obtained from another man would irrebuttably be presumed to be the father of the child and that the legal links between the donor of the sperm used in the artificial conception procedure and the child thus conceived be dissolved. It is, however, plain from the referral of powers by the relevant States to the Commonwealth that the object of the exercise was to facilitate the creation of a uniformly applicable Commonwealth scheme, and plain from the form of Div 1 of Pt VII, and particularly from the current forms of ss 60G and 60H, that Div 1 of Pt VII is designedly selective as to the State and Territory provisions relating to parentage that the Commonwealth permits to apply. Sections 60H(2) and 60H(3) in particular create an obviously intended capacity for the Commonwealth from time to time to add or to choose not to add, legislative provisions determinative of the parentage of a biological father of a child born as a result of an artificial conception procedure that apply under the Family Law Act. the State and Territory to exclude, those of The evident purpose of Div 1 of Pt VII of the Family Law Act is that the Commonwealth is to have sole control of the provisions that will be determinative of parentage under the Act46. Upon that basis it should be concluded that, even if ss 14(2) and 14(4) of the Status of Children Act were provisions which regulated the exercise of State jurisdiction in relation to a matter for which the laws of the Commonwealth failed to provide (which they are not), and were otherwise capable of being picked up and applied as a law of the Commonwealth regulating the exercise of federal jurisdiction, a law of the Commonwealth (namely, the Family Law Act) would otherwise provide. Section 109 of the Constitution Counsel for the first and second respondents and counsel for Victoria each advanced a further argument that, accepting that ss 14(2) and 14(4) of the Status of Children Act are not picked up and applied by s 79(1) of the Judiciary Act as a law of the Commonwealth regulating the exercise of federal jurisdiction, they nevertheless form part of the single composite body of law operating throughout the Commonwealth, and as such apply of their own force in federal jurisdiction as a valid law of the State of New South Wales unless and to the extent that they 46 See also Australia, House of Representatives, Family Law Amendment Bill 1987, Explanatory Memorandum at 37 [132]. Bell Nettle Gordon may be rendered inoperative by reason of s 109 of the Constitution as inconsistent with a valid law of the Commonwealth. It was contended that ss 14(2) and 14(4) of the Status of Children Act are neither directly inconsistent with any valid law of the Commonwealth – because ss 14(2) and 14(4) do not alter, impair or detract from the operation of Commonwealth law47 – nor indirectly inconsistent with Commonwealth law – because there is no Commonwealth law which evinces an intention to be a complete statement of the law governing the subject matter to which ss 14(2) and 14(4) apply, or, to put it another way, there is no Commonwealth law which contains an implicit negative proposition that nothing other than what the Commonwealth law provides with respect to that subject matter is to be the subject of legislation48. The first part of the argument may be accepted. For the reasons earlier given, ss 14(2) and 14(4) of the Status of Children Act create a rule of law that, in certain circumstances, the biological father of a child born as a result of an artificial conception procedure is not the father of the child. As has been explained, it is a rule of law determinative of status which applies independently of anything done by a court – as opposed to a rule regulating the exercise of jurisdiction – and so is not picked up by s 79(1) of the Judiciary Act and applied as a law of the Commonwealth. It may also be accepted that, but for inconsistency with Commonwealth law, ss 14(2) and 14(4) of the Status of Children Act would comprise part of the single composite body of law operating throughout the Commonwealth which, as a valid law of the State of New South Wales, applies of its own force in federal jurisdiction. 47 Victoria v The Commonwealth (1937) 58 CLR 618 at 630 per Dixon J; [1937] HCA 82; Dickson v The Queen (2010) 241 CLR 491 at 502 [13]-[14]; [2010] HCA 30; Jemena Asset Management (3) Pty Ltd v Coinvest Ltd (2011) 244 CLR 508 at 524-525 [39]-[41] per French CJ, Gummow, Heydon, Crennan, Kiefel and Bell JJ; [2011] HCA 33; Outback Ballooning (2019) 93 ALJR 212 at 221 [32] per Kiefel CJ, Bell, Keane, Nettle and Gordon JJ; 363 ALR 188 at 195-196. 48 Ex parte McLean (1930) 43 CLR 472 at 483-484 per Dixon J; [1930] HCA 12; Victoria v The Commonwealth (1937) 58 CLR 618 at 630 per Dixon J; Dickson v The Queen (2010) 241 CLR 491 at 502 [13]-[14]; Outback Ballooning (2019) 93 ALJR 212 at 221-222 [33]-[35] per Kiefel CJ, Bell, Keane, Nettle and Gordon JJ; 363 ALR 188 at 196. Bell Nettle Gordon The second part of the argument, however, must be rejected. For the reasons already stated, the Commonwealth has "otherwise provided" within the meaning of s 79(1) of the Judiciary Act and, therefore, it cannot be accepted that ss 14(2) and 14(4) of the Status of Children Act are not inconsistent with Div 1 of Pt VII of the Family Law Act. Such is the structure and evident purpose of the provisions of that Division that, although ss 60G and 60H are not exhaustive of the persons who may qualify under the Family Law Act as parents of children born of artificial conception procedures, if a person qualifies as the child's parent either under s 60G by reason of adoption or under s 60H, or according to ordinary acceptation of the word "parent", State provisions like ss 14(2) and 14(4) of the Status of Children Act are irrelevant. Division 1 of Pt VII of the Family Law Act evinces an intention to be a complete statement of the law governing the subject matter to which ss 14(2) and 14(4) apply and thereby evinces a negative implication that nothing other than what the Commonwealth law provides with respect to that subject matter is to be the subject of legislation. Perforce of s 109 of the Constitution, Div 1 of Pt VII of the Family Law Act prevails over ss 14(2) and 14(4) of the Status of Children Act to the extent of that inconsistency. In practical result, that means that the whole of ss 14(2) and 14(4) are excluded. Sperm donors Finally, counsel for the first and second respondents and counsel for Victoria contended that, if ss 14(2) and 14(4) of the Status of Children Act are not picked up and applied by s 79(1) of the Judiciary Act, and do not apply of their own force as part of the single composite body of law operating throughout the Commonwealth, this Court should hold that the ordinary, accepted English meaning of "parent" excludes a "sperm donor". Those submissions must also be rejected. As has been explained, the ordinary, accepted English meaning of the word "parent" is a question of fact and degree to be determined according to the ordinary, contemporary understanding of the word "parent" and the relevant facts and circumstances of the case at hand. To characterise the biological father of a child as a "sperm donor" suggests that the man in question has relevantly done no more than provide his semen to facilitate an artificial conception procedure on the basis of an express or implied understanding that he is thereafter to have nothing to do with any child born as a result of the procedure. Those are not the facts of this case. Here, as has been found – and the finding is not disputed – the appellant provided his semen to facilitate the artificial conception of his daughter on the express or implied Bell Nettle Gordon understanding that he would be the child's parent; that he would be registered on her birth certificate as her parent, as he is; and that he would, as her parent, support and care for her, as since her birth he has done. Accordingly, to characterise the appellant as a "sperm donor" is in effect to ignore all but one of the facts and circumstances which, in this case, have been held to be determinative. It is unnecessary to decide whether a man who relevantly does no more than provide his semen to facilitate an artificial conception procedure that results in the birth of a child falls within the ordinary accepted meaning of the word "parent". In the circumstances of this case, no reason has been shown to doubt the primary judge's conclusion that the appellant is a parent of his daughter. Conclusion It follows from these reasons that the appeal should be allowed. Orders 2, 3, 4 and 8 of the Full Court of the Family Court of Australia dated 28 June 2018 should be set aside. In their place, it should be ordered that appeal number EA 111 of 2017 to the Full Court be dismissed. The first and second respondents should pay the appellant's costs of the appeal to this Court. Edelman EDELMAN J. This appeal concerns federal jurisdiction. In the terminology used in the field of federal jurisdiction there are at least three distinct concepts relevant to this appeal. First, there is "jurisdiction", which means an authority to decide. Federal jurisdiction is therefore a federal authority to decide. It has a personal dimension concerning the persons over whom authority to decide is exercised. It has a territorial dimension concerning the geographical area within which authority to decide can be exercised. And it has a subject matter dimension concerning the issues in respect of which authority to decide can be exercised. Secondly, there are the powers that can be exercised by a court to make substantive orders when there is federal authority to decide. These include powers to impose criminal penalties, to award damages, to grant specific performance, injunctions or declarations, and so on. These orders can give effect to the rights, powers, duties, and liabilities of persons at general law or under statute. They can sanction an infringement of rights. And, on some occasions, the court's substantive orders will themselves define new rights or duties49. The boundaries within which the court's powers to make these substantive orders can be exercised are determined by the scope of the court's authority over person, place, and subject matter. Thirdly, there are laws that regulate or govern the federal authority to decide within which these substantive orders are made. Sometimes these laws are described as laws that "regulate the exercise of federal jurisdiction"50 or laws that "command a court as to the manner of exercise of federal jurisdiction"51. They are laws that concern aspects of federal jurisdiction such as how persons are served or made subject to authority, when a matter can be adjudicated, or the manner or process by which a matter is to be adjudicated. They are not limited to procedural laws or procedural powers of the court, although the most obvious examples are the rules of evidence and the rules of procedure52. The primary difference between my Rizeq v Western Australia ("Rizeq")53 and those of the other members of the for decision reasons 49 See Zakrzewski, Remedies Reclassified (2005), ch 13. 50 Alqudsi v The Queen (2016) 258 CLR 203 at 266 [171]; [2016] HCA 24; Rizeq v Western Australia (2017) 262 CLR 1 at 25 [59], 26 [62]; see also at 53-54 [144]; [2017] HCA 23. 51 Rizeq v Western Australia (2017) 262 CLR 1 at 26 [61]-[62]. 52 Rizeq v Western Australia (2017) 262 CLR 1 at 55 [151], 59 [163], 72-73 [200]. 53 (2017) 262 CLR 1. Court concerned whether laws that confer powers upon a court to make substantive orders in relation to the rights, powers, duties, and liabilities of persons are laws that regulate or govern the federal authority to decide. In my view they are not. That issue was not argued and did not need to be decided in Rizeq. Likewise, it was not argued and does not need to be decided on this appeal, although it informs the approach taken to the resolution of this appeal and the related examples discussed. A premise of s 79(1) of the Judiciary Act 1903 (Cth) is that the court is "exercising" federal jurisdiction54. This assumes that the court already has federal jurisdiction; s 79(1) does not need to confer jurisdiction. In my view, it also assumes that the court has existing powers to make substantive orders which can be exercised in relation to new and existing rights and duties; s 79(1) is not needed to confer new rights or to impose new duties upon persons, nor is it needed to confer powers upon the court to make orders to recognise or enforce those rights or duties or to sanction a breach of duty. For this reason, I consider that no difficulty arises as to whether or not there is constitutional power for s 79(1) to confer, in relation to potentially unlimited subject matters when a matter is within federal jurisdiction, new powers on State courts to make orders in relation to new duties on persons who are subject to those powers55. Further, this view gives rise to no anomalies that might otherwise arise if s 79(1) were needed to "pick up" a court's powers, which it could only do from local legislation, even if the applicable proper law was from a different State or Territory. These difficulties do not arise because s 79(1) of the Judiciary Act is concerned only with laws that regulate or govern the court's authority to decide. Section 79(1) says nothing about laws that create rules that are generally binding on people. Nor does it say anything about the existing powers of State, Territory or federal courts to recognise or enforce those rules or to sanction their breach56. It is concerned only with the necessary concomitant of a court having federal authority to decide and therefore to exercise its existing powers including in relation to existing rights and duties. That concomitant of the federal authority to decide is that the rules that govern or regulate that authority to decide, such as where a matter can be adjudicated, when it can be adjudicated, and "the manner 54 Solomons v District Court (NSW) (2002) 211 CLR 119 at 134 [23]; [2002] HCA 47; Rizeq (2017) 262 CLR 1 at 56 [152]; compare at 35 [87]. 55 See Rizeq (2017) 262 CLR 1 at 68-69 [191]. 56 Rizeq (2017) 262 CLR 1 at 54 [146], 56 [152], 72 [200]; compare at 33-34 [83]. Edelman in which [a matter] is to be adjudicated"57, must also be federal. Hence, s 79(1) picks up laws which are "binding on all Courts" concerning these issues. The instances cited in s 79(1) are instructive58. Laws relating to court procedure "bind" a court as to the manner in which it proceeds. Laws relating to evidence or competency of witnesses also "bind" a court as to the manner in which it proceeds. But s 79(1) is not limited to procedural or evidentiary matters59. Although not specifically mentioned in s 79(1), another example is limitation laws that bar a remedy but do not extinguish the underlying right60. These are not procedural rules "governing or regulating the mode or conduct of court proceedings"61, but instead concern the "means which the law provides for prosecuting [a] claim"62. Those laws determine whether the proceeding cannot succeed because a right can no longer be adjudicated if the limitation period is pleaded in defence. Rizeq was a case where there was no significant difficulty distinguishing between, on the one hand, a State law that creates a general rule that is binding on people and empowers a court to enforce the rule or to sanction its breach (with which s 79(1) is not concerned) and, on the other hand, a State law that regulates or governs the court's authority to decide (with which s 79(1) is concerned). Mr Rizeq was convicted in the District Court of Western Australia of offences under s 6(1)(a) of the Misuse of Drugs Act 1981 (WA), namely possession of a prohibited drug with intent to sell or supply. Mr Rizeq was sentenced by reference to s 34 of that Act. Since Mr Rizeq was an interstate 57 Rizeq (2017) 262 CLR 1 at 16 [23]; see also at 26 [61], 72-73 [200]. 58 Rizeq (2017) 262 CLR 1 at 54 [148]. 59 Rizeq (2017) 262 CLR 1 at 15 [19], 33 [83], 46 [122]. 60 See The Commonwealth v Mewett (1997) 191 CLR 471 at 534-535; [1997] HCA 61 John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 543-544 [99]; [2000] HCA 36, quoting McKain v R W Miller & Co (SA) Pty Ltd (1991) 174 CLR 1 at 26-27; [1991] HCA 56. See also Stevens v Head (1993) 176 CLR 433 at 445; [1993] HCA 19. 62 Rizeq (2017) 262 CLR 1 at 73-74 [202], quoting Bauserman v Blunt (1893) 147 US 647 at 659, in turn quoting Amy v Watertown [No 2] (1889) 130 US 320 at 325. resident, being a resident of New South Wales, the authority that the District Court exercised was federal jurisdiction63. Although the authority that was exercised over Mr Rizeq was federal, both the substantive offence-creating provision, s 6(1)(a), and the penalty provision, s 34(1), were State laws that applied of their own force. The rules concerning the offence in s 6(1)(a) and the maximum penalty in s 34(1) of the Misuse of Drugs Act were rules that applied to Mr Rizeq independently of whether the authority of the court was State or federal. Section 79(1) of the Judiciary Act did not need to "pick up" the text of those provisions64. However, in the trial of Mr Rizeq, other provisions which concerned the manner in which, or process by which, the matter was to be adjudicated, and which therefore regulated the federal authority of the District Court, were required to be, and were, picked up by s 79(1). One of those provisions was s 114(2) of the Criminal Procedure Act 2004 (WA), which concerned the circumstances in which a verdict of ten or more jurors shall be taken as the verdict on the charge. Another was s 11(a) of the Misuse of Drugs Act, which created a presumption of an intention to sell or supply a prohibited drug. Although s 11(a) was not raised or considered on the appeal to this Court, it was a rule of evidence that regulated the manner in which the District Court was to proceed in determining facts. It could not make the offence one that was "against any law of the Commonwealth" within s 80 of the Constitution. On the other hand, there will be cases where there is more difficulty in characterising a State law to determine whether it (i) creates a general rule that is binding on people or concerns application of existing powers to recognise or enforce the rule or sanction of its breach, or (ii) regulates or governs the court's authority to decide. For instance, general law rules that create duties of contribution65 are rules that apply of their own force in federal jurisdiction and can be enforced by courts. They are not rules that regulate or govern the court's authority to decide. However, State laws that extend the circumstances of 63 Constitution, s 75(iv); Judiciary Act, s 39(2). See Rizeq (2017) 262 CLR 1 at 11 64 Rizeq (2017) 262 CLR 1 at 74 [204]; compare at 16 [23]. 65 Burke v LFOT Pty Ltd (2002) 209 CLR 282 at 292 [14], 300 [41]; [2002] HCA 17. Edelman general contribution66 have been assumed in the absence of argument to regulate or govern the court's authority to decide67. Another example of a difficulty in characterising a State law is s 4 of the Civil Liability (Third Party Claims Against Insurers) Act 2017 (NSW). If this provision were characterised as regulating or governing the authority of the court then s 79(1) of the Judiciary Act would be required to pick it up, although that might not be possible if the matter were brought in another State even if the law of New South Wales were the applicable proper law68. Alternatively, a more natural characterisation of the section might be to treat it as conferring a substantive power on the State court to enforce rights and duties directly against an insurer. In such a circumstance, in my view, it would apply of its own force and, if part of the proper law in a case, it would apply to any other State court whether exercising federal jurisdiction or not. If the power were relied upon in the context of a matter in the Federal Court of Australia then the issue would be whether the broad power in s 23 of the Federal Court of Australia Act 1976 (Cth) extended to making, as an order of a kind that "the Court thinks appropriate", the same order as would have been made if the matter had been brought in a State court. That question would not depend upon the registry of the Federal Court in which the matter was heard. The issue of characterisation that arises on this appeal concerns the so- called "presumptions" in s 14(1)-(3) of the Status of Children Act 1996 (NSW), which are said in s 14(4) to be "irrebuttable" presumptions. An irrebuttable presumption is an oxymoron. It is not a presumption at all. It is a rule of substantive law69. A true presumption, such as that contained in s 11(a) of the Misuse of Drugs Act, arises from a standardised inference about the existence of a secondary fact based upon the probative force attributed to the presence of a 66 See, eg, Law Reform Act 1995 (Qld), ss 6, 7. 67 Austral Pacific Group Ltd (In liq) v Airservices Australia (2000) 203 CLR 136 at 142 [11]-[12], 143 [15], 155 [53]; [2000] HCA 39. Compare Rizeq (2017) 262 CLR 1 at 64 [178], 67 [186]. 68 See Stellios, "Choice of law in federal jurisdiction after Rizeq v Western Australia" (2018) 46 Australian Bar Review 187 at 197-198, discussing John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503. See also Rizeq (2017) 262 CLR 1 at 70-71 [194]. 69 Greenleaf, A Treatise on the Law of Evidence, 16th ed (1899), vol 1 at 108; Wigmore, A Treatise on the System of Evidence in Trials at Common Law (1905), vol 4 at 3535 §2492; Wills and Lawes, The Theory and Practice of the Law of Evidence, 2nd ed (1907) at 43-44; Holdsworth, A History of English Law, 3rd ed (1944), vol 9 at 139, 143-144; Wigmore, Evidence in Trials at Common Law, Chadbourn rev (1981), vol 9 at 307-308 §2492. primary fact. In contrast, the "irrebuttable presumption" in s 14(2) leaves "no room for judicial inquiry"70 as to the facts. Hence, I agree with the joint judgment on this appeal that s 14(1)-(3) of the Status of Children Act, although described as "irrebuttable" presumptions in s 14(4), are really substantive rules of law. The rule in s 14(2) of the Status of Children Act is that a man is not the father of a child merely because the child is born as a result of pregnancy by means of a fertilisation procedure using his sperm. That rule appears to be concerned with the general statutory rights and duties of persons. For instance, s 14(2) purports to apply independently of the powers of a court, by creating a rule as to parentage that will affect the duties of the parent and others, such as in relation to compulsory schooling71. However, s 14(2) can also be seen as inseparable from the court's substantive powers to determine and declare who is a parent, particularly where the court is required to resolve conflicting rules. Section 17(1) provides that "[i]f two or more irrebuttable presumptions arising under this Division conflict with each other, the presumption that appears to the court to be more or most likely to be correct prevails". One rule that could conflict with s 14(2) is the substantive rule of law, also described as an "irrebuttable" presumption72, in s 12(1): "A person is presumed to be a child's parent if: (a) while the person is alive, a prescribed court has: found expressly that the person is the child's parent, or (ii) made a finding that it could not have made unless the person was the child's parent, and the finding has not been altered, set aside or reversed." In this context, s 14(2) is inseparable from ss 12(1) and 17(1) and therefore is inextricably associated with the powers of the court to make findings and orders about parentage. Ultimately, in my view, it does not matter whether s 14(2) is characterised as concerned with the general statutory rights and duties of persons, or as 70 Williamson v Ah On (1926) 39 CLR 95 at 108; [1926] HCA 46. 71 See, for instance, Education Act 1990 (NSW), ss 22, 22B, 23. 72 Status of Children Act, s 12(2). Edelman inseparable from the powers of the court to make substantive orders, or both73. Under either of those characterisations s 14(2) is a law that applies of its own force. It is not a law that would need to be picked up by s 79(1) of the Judiciary Act. However, for the reasons given in the joint judgment74, s 14(2), read with s 14(4), is inconsistent with Div 1 of Pt VII of the Family Law Act 1975 (Cth) and is therefore inoperative by operation of s 109 of the Constitution. I agree with the orders proposed in the joint judgment. 73 Compare Rizeq (2017) 262 CLR 1 at 39-40 [100].

HIGH COURT OF AUSTRALIA MORETON BAY REGIONAL COUNCIL APPELLANT AND MEKPINE PTY LTD RESPONDENT Moreton Bay Regional Council v Mekpine Pty Ltd [2016] HCA 7 10 March 2016 ORDER Appeal allowed with costs. Set aside orders 2 and 3 of the Court of Appeal of the Supreme Court of Queensland made on 2 December 2014, and in their place order that the appeal be dismissed with costs. On appeal from the Supreme Court of Queensland Representation D F Jackson QC with A N S Skoien for the appellant (instructed by Moreton Bay Regional Council) G W Diehm QC with P D Hay for the respondent (instructed by Hillhouse Burrough McKeown Pty Ltd) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Moreton Bay Regional Council v Mekpine Pty Ltd Real property – Resumption of land – Leases – Where registered lease expressed to confer interest over specified lot of land that was later amalgamated with adjacent lot – Where land previously part of adjacent lot resumed by local council – Whether lessee's interest extended to entire amalgamated lot upon registration of plan of subdivision under Land Title Act 1994 (Q) – Whether lessee had compensable interest in resumed land under Acquisition of Land Act 1967 (Q), s 12(5). Real property – Leases – Retail leases – Construction and interpretation – Whether necessary to construe lease otherwise than in accordance with natural and ordinary effect of its terms. Statutes – Interpretation – Function of definition clause – Whether definition of "Common Areas" in retail shop lease inconsistent with definition of "common areas" in Retail Shop Leases Act 1994 (Q), s 6. Words and phrases – "common areas", "interest in land", "outgoings", "plan of subdivision", "registered lease", "registration of an instrument", "resumed land", "retail shop lease", "retail shopping centre". Acquisition of Land Act 1967 (Q), ss 2, 12(5). Acts Interpretation Act 1954 (Q), s 36. Land Title Act 1994 (Q), ss 12, 49, 49A, 50, 64, 65, 182, 183, 184, Sched 2. Retail Shop Leases Act 1994 (Q), ss 3, 5, 6, 7(1), 8, 19, 20, 38(2), 40(1), Pt 3 Div 2, Schedule. FRENCH CJ, KIEFEL, BELL AND NETTLE JJ. This is an appeal from a judgment of the Court of Appeal of the Supreme Court of Queensland. The respondent ("Mekpine") was a tenant in a shopping centre. Mekpine's registered lease was expressed to be over certain premises on land described as "Lot 6 on RP 809722" ("former Lot 6"). The lessor subsequently registered a plan of subdivision under the Land Title Act 1994 (Q) ("the LTA") to amalgamate former Lot 6 and an adjacent lot ("former Lot 1"1) to create a larger lot ("new Lot 1"2). When part of the land, which was part of former Lot 1, was resumed by the appellant ("the Council"), Mekpine claimed compensation under the Acquisition of Land Act 1967 (Q) ("the ALA"). The question in the appeal is whether Mekpine's rights under a lease of premises on former Lot 6 remained over that part of new Lot 1 which previously lay within former Lot 6 or whether they extended to the entirety of new Lot 1. For the reasons which follow, it should be concluded that Mekpine's interest in land remained confined to that part of new Lot 1 which previously lay within former Lot 6. The facts In March 1999, Mekpine entered into a 10 year retail lease ("the Lease") of a shop ("the Premises") within the Castle Hill Shopping Court in Murrumba Downs, Queensland ("the Shopping Centre") with options to renew. At that time, the Shopping Centre lay within the land comprised in former Lot 6. The Premises were defined in Item 3 of the Schedule to the Lease as: "Shop 1 at Castle Hill Shopping Court, Corner Dohles Rocks Road and Ogg Road, Murrumba Downs, Queensland, 4503". The Schedule to the Lease included a diagram setting out the metes and bounds of the Premises and former Lot 6. Clause 6.1 of the Lease conferred on Mekpine a right of exclusive possession of the Premises for the permitted use of operating a supermarket. In addition, cl 6.8 of the Lease provided that Mekpine was entitled to use the "Common Areas", in common with other tenants, as follows: 1 Former Lot 1 was on RP 847798. 2 New Lot 1 was on SP 184746. Bell Nettle "The Lessee and the Lessee's Employees may use the Common Areas but must obey all reasonable directions and rules given by the Lessor relating to their use. The Lessee must not obstruct the Common Areas or Car Park." "Common Areas" were defined in cl 1.2 of the Lease as "those areas of the Building or the Land which have not been leased or licensed by the Lessor". "Land", which appears in the definition of "Common Areas", was defined as "the lot described in Item 2 of the Form 7 in this Lease" and Item 2 of the Form 7 referenced former Lot 6 as the relevant "Land". Clause 15 further provided, however, in broad terms, that the Lease did not give Mekpine any rights to the Common Areas other than those specifically provided for in the Lease, that the Common Areas were the property of the lessor and that the lessor retained a right to use, control, manage, alter, close or deal with the Common Areas as the lessor might deem appropriate. The Lease was registered in the freehold land register kept under and for the purposes of the LTA on 25 January 2002. Subsequently, the lessor acquired former Lot 1, which was adjacent to former Lot 6, and obtained planning approval to extend the Shopping Centre over former Lot 1 on condition that former Lot 1 be amalgamated with former Lot 6 and that the area which later became the resumed land be excluded from the proposed development and kept clear of permanent structures and improvements. In accordance with that approval, in 2007 former Lot 1 was amalgamated with former Lot 6 by registration of a plan of subdivision under Div 3 of Pt 4 of the LTA, thereby creating new Lot 1 ("the Plan of Subdivision"). The Lease was endorsed on the Plan of Subdivision under the heading "EXISTING LEASE ALLOCATIONS" and identified as an encumbrance on the title. On 14 November 2008, the Council resumed a strip of vacant land from a corner of new Lot 1, being part of the land previously comprised in former Lot 1 ("the Resumed Land"), to perform road works3. The Resumed Land was never part of former Lot 6. Mekpine then brought a claim for compensation under the ALA contending that, by reason of s 182 of the LTA, upon registration of the Plan of 3 Queensland Government Gazette, No 72, 14 November 2008 at 1329. The Gazette provided that the Resumed Land was to be registered as Lot 11 on SP 215604. Bell Nettle Subdivision for the amalgamation of former Lot 1 with former Lot 6, Mekpine acquired an interest in new Lot 1 and thus in the Resumed Land. Mekpine's claim In order to be entitled to compensation under the ALA, Mekpine must have had an "interest" in the Resumed Land. Section 12(5) of the ALA relevantly provides: "On and from the date of the publication of the gazette resumption notice the land thereby taken shall be vested or become unallocated State land ... and the estate and interest of every person entitled to the whole or any part of the land shall thereby be converted into a right to claim compensation under this Act". "Land" is defined in the ALA as "land, or any estate or interest in land, that is held in fee simple, including fee simple in trust under the Land Act 1994, but does not include a freeholding lease under that Act"4. Although "interest in land" is not defined in the ALA, s 36 of the Acts Interpretation Act 1954 (Q) ("the AIA") provides: "interest, in relation to land or other property, means— a legal or equitable estate in the land or other property; or a right, power or privilege over, or in relation to, the land or other property." It has not been in dispute in these proceedings that Mekpine has a relevant interest in the land in former Lot 6 by virtue of the Lease. The principal question on the appeal is whether that interest extended to new Lot 1 on the registration of the Plan of Subdivision. Mekpine's claim for compensation under the ALA had two alternative bases. First, it claimed that its interest in the Resumed Land for which it had a right to compensation arose from the registration of the Plan of Subdivision under s 182 of the LTA. It contended that, by necessary implication, "Land" in the Lease refers to "new Lot 1" and, therefore, that Mekpine had a right to use the 4 ALA, s 2. Bell Nettle Common Areas in new Lot 1. In the alternative, Mekpine claimed that, pursuant to s 20 of the Retail Shop Leases Act 1994 (Q) ("the RSLA"), the definition of Common Areas in the Lease was inconsistent with the definition of "common areas" in the RSLA and, therefore, that the definition of "common areas" in the RSLA had to be read into the Lease in place of the Lease definition of Common Areas. The proceedings below On 10 September 2012, the Land Court of Queensland5 held that, as the parties had not amended the Lease, the Common Areas over which the lessee gained contractual rights pursuant to the Lease remained those within former Lot 6, not the extended Common Areas within new Lot 1. The Land Court nevertheless upheld Mekpine's claim for compensation on the basis that the definition of Common Areas in the Lease should be substituted by the definition of "common areas" in the RSLA. The effect was that, once former Lot 1 became part of the Shopping Centre, the Common Areas for the purpose of the Lease extended to those parts of the common areas as defined by the RSLA as lay within new Lot 1. On that basis, the Land Court concluded that Mekpine had an interest in the nature of contractual rights over the parts of the common areas as defined in the RSLA that lay within former Lot 1. The Land Appeal Court of Queensland allowed an appeal against the Land Court's judgment6. It upheld the Land Court's conclusion that, despite the amalgamation of former Lot 1 with former Lot 6, Mekpine's interest as lessee under the Lease continued to be defined by the terms of the Lease and so remained confined to the land previously comprised in former Lot 6. But it reversed the Land Court's holding that the definition of "common areas" in the RSLA should be substituted for the definition of Common Areas in the Lease. It concluded that the amalgamation of former Lot 1 with former Lot 6 did not confer any interest in Mekpine beyond the land previously comprised in former Lot 6. Mekpine appealed to the Court of Appeal and the appeal was allowed by majority (McMurdo P and Morrison JA, Holmes JA dissenting)7. 5 Mekpine Pty Ltd v Moreton Bay Regional Council [2012] QLC 0046. 6 Moreton Bay Regional Council v Mekpine Pty Ltd [2013] QLAC 5. 7 Mekpine Pty Ltd v Moreton Bay Regional Council (2014) 206 LGERA 120. Bell Nettle The reasoning of the Court of Appeal The majority of the Court of Appeal held that the Plan of Subdivision for the amalgamation of former Lot 1 with former Lot 6 with "EXISTING LEASE ALLOCATIONS" noted on it was an "instrument" within the meaning of s 182 of the LTA which transferred to, or created in, Mekpine a leasehold interest in new Lot 1; and, therefore, that, as from the time of registration of the Plan of Subdivision, the definition of "Land" in the Lease was required to be read as referring to new Lot 1 rather than former Lot 6. As former Lot 6 ceased to exist, the reference to "Land" became a reference to the land in new Lot 1. The effect of the decision of the majority, it will be observed, is to extend Mekpine's interest in land beyond that given by the Lease as registered. In the alternative, their Honours reasoned that, if that were not the case, it was nevertheless apparent that the legislative intent of the RSLA was that the s 6 definition of "common areas" should be incorporated into retail shop leases and, therefore, that the Land Court had been correct in concluding that the RSLA in effect amended the Lease so that the Common Areas as defined in the Lease became all of the common areas within new Lot 1. In contrast, Holmes JA concluded that the only interest created or vested by registration of the Plan of Subdivision was the lessor's interest in new Lot 1 and, consequently, that Mekpine's existing leasehold interest in former Lot 6 was simply recorded in respect of new Lot 1. Holmes JA also held that the definition of "common areas" in s 6 was without substantive effect and had no other function than to explain what was meant by "common areas" in the definition of "retail shopping centre" in s 8 of the RSLA, with the result that s 6 of the RSLA did not replace the Lease's definition of Common Areas. Relevant statutory provisions Land Title Act The LTA provides for the registration of land and interests in land. An "instrument" must be registered in order to create an interest in a lot8. Section 184 gives such registered interests indefeasibility. Section 184(1) 8 LTA, s 181. Bell Nettle provides that, subject to certain exceptions9, a "registered proprietor of an interest in a lot holds the interest subject to registered interests affecting the lot but free from all other interests". "Instrument" is defined in the Dictionary in Sched 2 to the LTA as including, inter alia, a "document that deals with a lot and may be registered under this Act" and "a map or plan of survey that may be lodged". Both the Lease and the Plan of Subdivision are instruments within the meaning of that definition. "Lot" is defined as a "separate, distinct parcel of land" created on the registration of a plan of subdivision or the recording of particulars of an instrument. Section 183 of the LTA gave Mekpine the right to register the Lease over former Lot 6 and the lessor the right to register the Plan of Subdivision amalgamating former Lot 1 and former Lot 6. It provides in substance that a person in whom an interest has been created has a right to have the instrument creating the interest registered if the instrument is executed, the person lodges the instrument for registration together with such other documents as the registrar requires to effect registration and the person has otherwise complied with the LTA. Section 182, upon which Mekpine relied in its claim for compensation, sets out the effect of registration on an interest in land. It provides: "On registration of an instrument that is expressed to transfer or create an interest in a lot, the interest— is transferred or created in accordance with the instrument; and is registered; and vests in the person identified in the instrument as the person entitled to the interest." The LTA also contains specific provisions for the registration of leases. Section 64 provides that a "lot or part of a lot may be leased by registering an instrument of lease for the lot or part". Section 65 sets out the requirements of an instrument of lease. It provides, inter alia, that an instrument of lease for a lot or 9 LTA, ss 184(3), 185. Bell Nettle part of a lot must be validly executed, include a description sufficient to identify the lot or part of the lot to be leased (which may be by plan of survey, as was done here) and include an acknowledgment of the amount paid or details of other consideration. Sub-sections (2) and (3) of s 67 provide that a registered lease may be amended by registering an instrument of amendment of the lease, but the instrument must not increase or decrease the area of land leased. In this case, the Lease was not amended. Pursuant to the provisions relating to the registration of interests created by leases and ss 181-185, Mekpine's interest in former Lot 6 was created in accordance with the Lease by registration of the instrument of lease on 25 January 2002. The LTA further provides for the registration of plans of subdivision10. A plan of subdivision is relevantly defined as a "plan of survey providing for ... amalgamation of 2 or more lots to create a smaller number of lots"11. Section 50 of the LTA creates requirements for the registration of a plan of subdivision. It requires, inter alia, that "all other registered proprietors whose interests are affected by the plan" must consent to the plan of subdivision12. Pursuant to the provisions relating to registration of plans of subdivision and ss 181-185, the amalgamation of former Lot 1 and former Lot 6 to create new Lot 1 was achieved by lodging the Plan of Subdivision for registration on 27 September 2007. Retail Shop Leases Act The RSLA relates to Mekpine's alternative argument that the definition of "common areas" in s 6 of the RSLA should be substituted for the definition of Common Areas in the Lease. Unlike in the Lease, "common areas" in the RSLA are not defined by reference to former Lot 6 and are broad enough to include the "common areas" of the retail shopping centre on new Lot 1 comprised in the Resumed Land. The definition of "common areas" in the RSLA appears in Div 2 of Pt 3, which is entitled "Extended definitions". Section 6 provides in substance that 10 LTA, s 49A(1). 11 LTA, s 49(b). 12 LTA, s 50(1)(j). Bell Nettle "common areas" of a retail shopping centre are areas, excluding leased areas, in or adjacent to the centre that are used or intended for use by the public or in common by the lessees of premises in the centre in relation to the conduct of businesses in premises in the centre13. "Common areas" include stairways, escalators and elevators, malls and walkways, parking, toilets and restrooms, gardens and fountains, and information, entertainment, community and leisure facilities14. Section 20 of the RSLA provides that, if a provision of the RSLA is "inconsistent with a provision of a retail shop lease, the provision of [the RSLA] prevails and the provision of the lease is void to the extent of the inconsistency". The definitions of "retail shop", "retail shop lease" and "retail shopping centre" inform the definition of "common areas" and the operation of s 20. While "retail shopping centre" appears in a division of the RSLA which is headed "Extended definitions"15, "retail shop" and "retail shop lease" appear in the Schedule to the RSLA by reference to a division which is entitled "Standard definitions"16. "Retail shop" is defined in the Schedule to the RSLA as including premises that are situated in a retail shopping centre. It is not disputed that the Premises were a retail shop within the meaning of that definition. "Retail shop lease" is defined in the Schedule to the RSLA as including a lease of a retail shop other than a retail shop with a floor area of more than 1,000 metres squared. It is not disputed that the Lease was a retail shop lease within the meaning of that definition. "Retail shopping centre" is defined in s 8 of the RSLA as a cluster of premises where: five or more of the premises are used wholly or predominantly for carrying on retail businesses; all of the premises have the same lessor or head lessor; all of the premises are located in one building or two or more buildings separated by "common areas", other areas owned by the owner or a road; and the cluster of premises is promoted, or generally regarded, as constituting a shopping 13 RSLA, s 6(1), (3). 14 RSLA, s 6(2). 15 RSLA, Pt 3 Div 2. 16 RSLA, Pt 3 Div 1. Bell Nettle centre, shopping mall, shopping court or shopping arcade. It is not disputed that the Shopping Centre was a "retail shopping centre". Section 182 of the LTA In common with other Torrens systems, the LTA establishes a system of title to land by registration. It has the effect, however, that when an "interest" is created by an "instrument" that is registered, the result is a registered interest corresponding to the interest created by the instrument. Thus, as has been seen, s 182 of the LTA provides that, on registration of an instrument that is expressed to create an interest in a lot, "the [registered] interest ... is ... created in accordance with the instrument; and ... is registered; and ... vests in the person identified in the instrument as the person entitled to the interest". It follows, as Holmes JA held, that the Lease was an "instrument" which created Mekpine's interest as lessee in former Lot 6 and, upon registration of the Lease pursuant to s 182 of the LTA, Mekpine acquired a registered interest as lessee in former Lot 6 in accordance with the Lease. When former Lot 6 was later amalgamated with former Lot 1 resulting in the creation of new Lot 1, former Lot 6 ceased to exist as a "lot" and therefore as "a separate, distinct parcel of land"17. Hence, upon registration of the Plan of Subdivision, a single indefeasible title issued for new Lot 118. If the Lease had not been registered at that point, it would have followed under s 184(1) that the registered proprietor of new Lot 1 took the proprietorship interest in new Lot 1 freed and discharged of Mekpine's interest as lessee (subject only to the fraud exception provided for in s 184(3)(b) and possibly some other personal equities). But, because the Lease was registered at that point, the lessor took its proprietorship interest in new Lot 1 subject to Mekpine's registered interest as lessee19. The registered interest created in Mekpine as a result of s 182 of the LTA was a registered interest as lessee corresponding to the interest which had been created in accordance with the Lease. That interest as lessee remained registered at the time of creation of new Lot 1 and was one of the "EXISTING LEASE ALLOCATIONS" noted on the Plan of Subdivision. And, as was clear from the 17 LTA, Sched 2. 18 LTA, s 49A. 19 LTA, s 184(1). Bell Nettle terms of the Lease, that interest was confined to so much of new Lot 1 as had previously been comprised in former Lot 6. In the result, there was nothing in s 182 of the LTA which of itself operated to increase the rights created by the Lease beyond the area of the land comprised in former Lot 6. Sections 64 and 65 of the LTA As already noted, s 64 of the LTA provides for the registration of an instrument of lease for a lot or part of a lot and s 65 provides, inter alia, that if the instrument of lease is for part of a lot, the instrument must include a sketch plan identifying the part of the lot which is drawn to a standard to the registrar's satisfaction, a plan of survey identifying the part of the lot, or a description alone if the registrar is satisfied that the land is sufficiently identified by the description in the instrument. The Lease included a plan of survey precisely identifying the metes and bounds of former Lot 6 and thus the part of new Lot 1 over which the Lease was to be registered. The Lease also contained a description of the "Land" the subject of the Lease which precisely identified the "Land" as "Lot 6 on RP 809722". Consequently, from the time of registration of the Plan of Subdivision, the Lease was registered under s 64 over only that part of new Lot 1 identified as former Lot 6. The "instrument" by which an interest in land, namely former Lot 6, was vested in Mekpine on registration was the Lease, not the Plan of Subdivision. It follows that, despite registration of the Plan of Subdivision and the consequent extinguishment of former Lot 6 as a "lot"20, the Lease's definition of "Land" remained unchanged as former Lot 6, and continued to function as a precise description of that part of new Lot 1 over which the Lease was registered. Implication derived from the definition of Land in the Lease Mekpine contended that it was implicit in the "Land" being defined in the Lease in terms of the registered description of the land on which the Premises were constructed that, if the land on which the Premises were constructed were amalgamated with other land, the "Land" should thenceforth be read as meaning the registered description of the amalgamated land. 20 "Lot" is defined as "a separate, distinct parcel of land created on ... the registration of a plan of subdivision; or ... the recording of particulars of an instrument": LTA, Sched 2. Bell Nettle Counsel for Mekpine submitted that, in order to give the Lease business efficacy, it was necessary to read "Land" as meaning "Lot 6 on RP 809722" together with such other land as might be amalgamated from time to time with that lot. Counsel also relied on cll 6.8, 6.13, 16.4 and 25(k) of the Lease as supporting that implication. Those submissions should be rejected. Clause 16.4 of the Lease provided: "The Lessor may subdivide the Land or grant easements or other rights over it or register a Community Title Scheme for the Land. The Lessee must at the Lessor's expense sign any consent or document needed by the Lessor so the Lessor can carry out its rights under this clause without interference with the Lessee's other rights under this Lease." It is apparent from cl 16.4 that the parties to the Lease contemplated the possibility that the Land might be reduced by subdivision from time to time during the course of the Lease. It follows that, if the Land were subdivided, the definition of "Land" in the Lease would have to be read as applying to only so much of the Land as remained following the subdivision. In that sense, it is correct to say that the parties appear to have contemplated that the Common Areas as defined could be reduced accordingly from time to time. It does not follow, however, that the parties should be taken to have intended that, if the Land were amalgamated with other land to form a new expanded lot, but the Lease were registered as an existing encumbrance over only such part of the new lot as was previously comprised in the Land, the definition of "Land" in the Lease should be read as extending to the remainder of the new lot. To the contrary, it is opposed to business common sense to suppose that honest and reasonable business persons would contemplate that, whenever and if the Land were amalgamated with other land, the lessee should automatically and without additional consideration acquire an interest in or right over the further land so acquired. The idea of the Common Areas expanding with each new consolidation is also inconsistent with the express exclusion by cl 15 of the Lease of any common area rights other than those specifically provided for in the Lease and the entitlement of the lessor under cl 15 to reduce and restrict the Common Areas at the lessor's discretion. Clause 25(k) of the Lease provided that: "This Guarantee and Indemnity shall extend to cover any holding over under or renewal of this Lease (whether resulting from a valid exercise of any option under this Lease or otherwise) and shall also extend to cover any substitute or replacement lease resulting from any right under this Bell Nettle Lease for the Lessor to relocate the Lessee or subdivide, amalgamate or otherwise deal with the Premises or Land containing the Premises". The effect of that clause was that, when and if amalgamation of the Land with other land or subdivision of the Land results in the need for a substituted lease – as it could do if the terms of the Lease needed to be amended to accommodate the amalgamation or subdivision – the Guarantee should apply to the replacement lease. Given that a guarantee is ordinarily construed strictissimi juris21, such a provision is ordinarily to be expected. That does not imply that the definition of "Land" in the Lease should be taken to include not only former Lot 6 but also such other land as might be amalgamated with former Lot 6 from time to time. If anything, it suggests the contrary. Clause 6.8 of the Lease provided that the lessee and the lessee's employees may use the Common Areas and must obey all reasonable directions given by the lessor relating to their use and must not obstruct the Common Areas or the Car Park. Clause 6.13 provided that the lessee must not park or permit the lessee's employees to park motor vehicles in the Car Parking Area other than areas set aside for staff parking22, and that the lessee must pay the lessor, upon demand, an amount of one hundred dollars by way of liquidated damages for each daily usage by each motor vehicle of the lessee or the lessee's employees which is parked in areas of the Car Parking Area not set aside for staff parking. There is nothing in those provisions, however, which suggests that the definition of "Land" in the Lease should be taken to include not only former Lot 6 but also such other land as with which former Lot 6 might be amalgamated from time to time. As drafted, the Lease confines the lessee's interest, including in Common Areas and use of the Car Parking Area, to the land comprised in former Lot 6. As with cl 16.4, it would be opposed to business common sense to suppose a common intention that, if the lessor acquired additional land and amalgamated it with the Land, the lessee should thereby and without additional consideration be granted an interest by way of additional Common Areas and access to any Car Parking Area over the additional land or equally be subjected 21 Ankar Pty Ltd v National Westminster Finance (Australia) Ltd (1987) 162 CLR 549 at 561 per Mason ACJ, Wilson, Brennan and Dawson JJ; [1987] HCA 15; Chan v Cresdon Pty Ltd (1989) 168 CLR 242 at 256 per Mason CJ, Brennan, Deane and McHugh JJ; [1989] HCA 63. 22 "Car Parking Area" is defined in cl 1.2 of the Lease as "that part of the Land sealed, marked and set aside for the prime purpose of the parking of cars". Bell Nettle to additional obligations in respect of the additional Common Areas and Car Parking Area. More generally, there is nothing in the Lease which implies that it is necessary to construe the Lease otherwise than in accordance with the natural and ordinary effect of its terms23, or that to construe the Lease in accordance with the natural and ordinary effect of its terms would be productive of a result which is suggestive of commercial nonsense or even commercial inconvenience24. The Lease is capable of working efficaciously in the manner in which it was evidently intended to operate by treating the definition of "Land" as drafted as confined to that part of new Lot 1 which was previously comprised in former Lot 6. "Land" for the purposes of the Lease means the land comprised in former Lot 6 and therefore excludes so much of any Common Areas as may have been comprised in the remainder of new Lot 1. The application of the RSLA That leaves for consideration Mekpine's alternative claim to have an "interest" in the Resumed Land based on the provisions of the RSLA. Counsel for Mekpine argued that because the RSLA definition of "common areas" applied to the Lease, Mekpine had a "right, power or privilege"25 over the part of new Lot 1 that was resumed and therefore was entitled to compensation under s 12(5) of the ALA. The argument should be rejected. Since there is no operative provision of the RSLA that expressly incorporates the definition of "common areas" into retail shop leases, the definition of "common areas" in the RSLA must prima facie be read as confined to the RSLA. As Barwick CJ, McTiernan and Taylor JJ held in Gibb v Federal Commissioner of Taxation26, definitions in a statute ordinarily do 23 Cf Currie v Glen (1936) 54 CLR 445 at 458-459 per Dixon J; [1936] HCA 1. 24 Cf Hide & Skin Trading Pty Ltd v Oceanic Meat Traders Ltd (1990) 20 NSWLR 310 at 313-314 per Kirby P; Zhu v Treasurer of New South Wales (2004) 218 CLR 530 at 559 [82] per Gleeson CJ, Gummow, Kirby, Callinan and Heydon JJ; [2004] HCA 56. 25 AIA, s 36, definition of "interest". 26 (1966) 118 CLR 628 at 635; [1966] HCA 74. Bell Nettle "no more than define the meaning to be assigned to [a] word ... as used in the "The function of a definition clause in a statute is merely to indicate that when particular words or expressions the subject of definition, are found in the substantive part of the statute under consideration, they are to be understood in the defined sense – or are to be taken to include certain things which, but for the definition, they would not include. Such clauses are, therefore, no more than an aid to the construction of the statute and do not operate in any other way." Of course the "general principle"28 may be modified by a clear contrary legislative intent. But the RSLA does not display any such contrary intent. Counsel for Mekpine argued that the contrary intent did arise from the fact that the RSLA definition of "common areas" was an Extended definition, as opposed to a Standard definition, and that the implication was supported by ss 3 and 20 of the RSLA; the implication of the RSLA's provisions in all retail shop leases; ss 7(1)(a)(ii) and 38(2) of the RSLA and s 40(1)(a) of the RSLA. It is apparent, however, upon examination of those provisions that that is not so. "Standard definitions" are defined by s 5 of the RSLA as being the definitions of various terms which appear in the Dictionary in the Schedule. "Extended definitions" are definitions which by and large are more extensive than Standard definitions and appear in Div 2 of Pt 3 of the RSLA. There is nothing in the distinction or more generally about the structure or terms of any of the Extended definitions which suggests that the Extended definition of "common areas" serves any function other than defining the expression for the purposes of the RSLA29. Section 3 of the RSLA provides that the object of the RSLA is "to promote efficiency and equity in the conduct of certain retail businesses in Queensland". Evidently, it is the purpose of the RSLA to achieve that objective by requiring compliance with the various operative provisions of the RSLA. But there is nothing about the definition of "common areas" in the RSLA which 27 Gibb (1966) 118 CLR 628 at 635. 28 Mekpine Pty Ltd v Moreton Bay Regional Council (2014) 206 LGERA 120 at 133 29 Cf Gibb (1966) 118 CLR 628 at 635. Bell Nettle suggests that it is the purpose of the RSLA to achieve the objective of efficiency and equity by substituting the statutory definition of "common areas" for the definition in a lease wherever it occurs. Of itself, the statutory definition of "common areas" does no more than define the meaning to be assigned to the term "common areas" as it is used in the RSLA30. Section 20 of the RSLA might be thought to be significant in that it provides that, if a provision of the RSLA is inconsistent with a provision of a retail shop lease, the provision of the lease is void to the extent of the inconsistency. But, logically, there is no relevant inconsistency between definitions unless there is a difference between them that is productive of a difference in the effect of an operative provision according to which definition is applied; and, in this case, there are no relevant provisions of which the effect would differ according to which definition of "common areas" is applied. Nor are there any other provisions of the RSLA which appear to require that the statutory definition of "common areas" be substituted for the definition of Common Areas in the Lease. The "intended wide application"31 of the RSLA is also essentially beside the point. Regardless of how wide the RSLA's ambit of application may be, its operative provisions take effect according to their terms, and there is no inconsistency between any of the operative provisions of the Lease and the operative provisions of the RSLA with respect to common areas. The "implication of the Act's provisions in all retail shop leases"32 falls into a similar category; and the prohibition on contracting out of the RSLA, which appears in s 19, has no relevant effect except where the operative provisions of a lease are inconsistent with the operative provisions of the RSLA. In this case, there is no inconsistency. Section 7(1)(a)(ii) of the RSLA defines "outgoings" as including the lessor's "reasonable expenses directly attributable to the operation, maintenance or repair" of "areas used in association with the centre"; and the expression "areas used in association with the centre" embraces the broader definition of "common 30 Gibb (1966) 118 CLR 628 at 635. 31 Mekpine Pty Ltd v Moreton Bay Regional Council (2014) 206 LGERA 120 at 133 [37] per McMurdo P. 32 Mekpine Pty Ltd v Moreton Bay Regional Council (2014) 206 LGERA 120 at 133- 134 [37] per McMurdo P. Bell Nettle areas" in the Act. Section 38(2) provides that the lessee's proportion of apportionable outgoings must not exceed an amount calculated on the basis of "the proportion that the area of the lessee's leased shop bears to the total area of all premises in the centre"; and that "the total area of all premises in the centre" comprises areas "leased to or occupied by lessees" or "available for lease to or occupation by lessees" who "enjoy or share the benefit resulting from the outgoing". In Mekpine's submission, if the Lease's definition of Common Areas were applied, the effect of those provisions would be that the common areas within former Lot 1 would not be included in the calculation of the lessee's proportion of the outgoings, even though the lessor's actual outgoings include the costs of maintaining those areas; and, therefore, that the extent of the common areas directly affected the lessee's contribution to outgoings. That submission is misplaced. The effect of the provisions would be that, if the Lease provided for the lessee to pay apportionable outgoings on a different basis from that which is provided for in s 38(2), s 38(2) would prevail pro tanto over the Lease. But, in fact, the Lease does not provide for the lessee to pay any outgoings. It specifically provides in cl 4.1 that the lessee is not liable to pay or contribute to outgoings. Finally, s 40(1)(a) operates where a lessee is required to pay amounts towards a sinking fund for the "maintenance of, or repairs to ... areas used in association with ... the retail shopping centre". For present purposes, that is also beside the point. As was earlier noticed, "areas used in association with" the retail shopping centre embrace the "common areas" as defined in s 6. Hence, if the Lease had provided for the lessee to make payments towards a sinking fund on a different basis from the provision for payments in s 40(1), s 20 would apply to make s 40(1) prevail. In fact, however, the Lease does not provide for the lessee to make any payments towards a sinking fund for maintenance. The effect of cl 4.1 is that the lessee is not liable to pay anything towards maintenance. In short, the RSLA definition of "common areas" did not supplant the definition of Common Areas in the Lease, and Mekpine does not have a compensable "interest" in the Resumed Land33. Conclusion For these reasons, the appeal should be allowed. Orders 2 and 3 of the Court of Appeal made on 2 December 2014 should be set aside. In lieu, it should 33 ALA, s 12(5). Bell Nettle be ordered that the appeal to the Court of Appeal is dismissed with costs. Mekpine should pay the Council's costs in this Court. The orders proposed in the joint reasons for judgment will have the effect of reinstating the negative answer given by the Land Appeal Court to the question of whether Mekpine had an interest which was compensable under the ALA on the resumption of the Resumed Land. I agree with those orders. In relation to the construction and application of the RSLA, I agree with the joint reasons for judgment and have nothing to add. In relation to the construction and application of the LTA, I prefer to state my own reasons. The LTA adopts the conventional design of providing for title by registration as distinct from registration of title34. It defines "lot" to mean "a separate, distinct parcel of land created", relevantly, on "the registration of a plan of subdivision"35. It provides that "[a] lot or part of a lot may be leased by registering an instrument of lease for the lot or part"36. It defines "instrument" not only specifically to include a "plan of survey"37, of which a plan of subdivision is a kind38, but also to extend to any "document that deals with a lot and may be registered"39. It provides in s 182 that "[o]n registration of an instrument that is expressed to ... create an interest in a lot, the interest ... is ... created in accordance with the instrument ... and ... vests in the person identified in the instrument as the person entitled to the interest". It defines "registered proprietor" to mean a person recorded in the register as "a person entitled to an interest in a lot"40, and it provides subject to immaterial exceptions that "[a] registered proprietor of an interest in a lot holds the interest subject to registered interests affecting the lot but free from all other interests"41. On the registration of a plan of subdivision which provides for "amalgamation of 2 or more lots to create a smaller number of lots"42, "[a] lot 34 Peldan v Anderson (2006) 227 CLR 471 at 480 [20]; [2006] HCA 48. 35 Schedule 2 to the LTA, "lot". See also s 49A of the LTA. 36 Section 64 of the LTA. 37 Schedule 2 to the LTA, "instrument". 38 Section 49 of the LTA. 39 Schedule 2 to the LTA, "instrument". 40 Schedule 2 to the LTA, "proprietor" and "registered proprietor". 41 Section 184(1) of the LTA. 42 Section 49(b) of the LTA. defined in the plan is created as a lot"43. It is implicit in the definition of a lot as a separate and distinct parcel of land that lots amalgamated must cease to exist. That is because the definition does not admit of the coexistence of overlapping lots. It follows that, on registration of the Plan of Subdivision, new Lot 1 was brought into existence as a separate and distinct parcel of land. It also follows that, on registration of the Plan of Subdivision, former Lot 6 and former Lot 1 each ceased to exist as a separate and distinct parcel of land. By reason of registration of the Plan of Subdivision, Mekpine and other registered proprietors of leases of the equivalent parts of former Lot 6 therefore lost their existing leasehold interests, in that the parcel of land part of which they had leased no longer existed. But for registration of their existing instruments of lease for parts of new Lot 1, Mekpine and other registered proprietors of leases of the equivalent parts of former Lot 6 would have obtained no new leasehold interests, in that new Lot 1 was brought into existence free from all unregistered interests44. On that basis, Mekpine and other registered proprietors of leases of the equivalent parts of former Lot 6 were, in my opinion, "registered proprietors whose interests [were] affected by" the Plan of Subdivision within the meaning of s 50(1)(j) of the LTA and whose consent to the Plan of Subdivision was for that reason required by that provision. That said, and despite the division of opinion on that topic between Holmes JA and Morrison JA in the Court of Appeal, I do not think that anything can turn for present purposes on whether or not it might be inferred that Mekpine consented to the Plan of Subdivision. The LTA makes plain that consent necessary for dealing with a lot need not always appear on the face of the relevant instrument45. The existence or non-existence of consent on the part of Mekpine is a question of fact, which was not in issue before the Land Court or the Land Appeal Court and about which no evidence was given and no findings were made by the Land Court or the Land Appeal Court. The appeal to the Court of Appeal was relevantly confined to an appeal on the ground of error or mistake of law on the part of the Land Appeal Court46. 43 Section 49A(2) of the LTA. 44 Cf Medical Benefits Fund of Australia Ltd v Fisher [1984] 1 Qd R 606 at 607-610. 45 Section 12 of the LTA. 46 Section 74(1)(a) of the Land Court Act 2000 (Q). The appeal from the Land Appeal Court to the Court of Appeal necessarily turned on the correctness in law of the Land Appeal Court's construction of Mekpine's instrument of lease – the Lease – and on the relevant effect, if any, under s 182 of the LTA of the recording of the Lease on the Plan of Subdivision as one of the "existing lease allocations" which "encumbered" new Lot 1. So too does the appeal from the Court of Appeal to this Court. The recording of the Lease on the Plan of Subdivision as one of the existing lease allocations which encumbered new Lot 1 constituted registration for new Lot 1 of the Lease previously registered for former Lot 6. That new registration did nothing to alter the terms in which the Lease was expressed. The Lease was expressed to create a leasehold interest in the Premises. The Premises, originally part of former Lot 6, became by reason of the registration of the Plan of Subdivision part of new Lot 1. The recording of the Lease on the Plan of Subdivision as an existing lease allocation encumbering new Lot 1 had the effect under s 182 of the LTA of creating a leasehold interest in that part of new Lot 1 designated as the Premises and of vesting that newly created leasehold interest in Mekpine. By that operation of s 182, Mekpine became the registered proprietor of a leasehold interest in that part of new Lot 1 which corresponded to the description in the Lease of the Premises. Clause 6.8 of the Lease was not, however, expressed to create a leasehold interest in the Common Areas, which the Lease defined as "those areas of the Building [meaning 'the building of which the Premises forms part'] or the Land [meaning 'the lot described in Item 2 of the Form 7 in [the] Lease', being former Lot 6] which have not been leased or licensed by the Lessor". Clause 15 made clear that the Common Areas remained the property of the lessor, that the lessor might alter or deal with the Common Areas at any time as the lessor saw fit, and that the Lease did not give the lessee any rights to the Common Areas other than those specifically provided for in the Lease. The right conferred on Mekpine as lessee by cl 6.8 was confined to a contractual licence to use the Common Areas as those Common Areas might exist from time to time. On the authority of Sorrento Medical Service Pty Ltd v Chief Executive, Department of Main Roads47, the correctness of which was not in issue in the appeal, Mekpine's contractual licence to use the Common Areas as conferred by cl 6.8 of the Lease was a "right ... over, or in relation to" land so as to fall within the definition of an "interest, in relation to land" in s 36 of the AIA and so as to be compensable on the resumption of the land in question under the ALA. Although it can on that basis be taken for present purposes to have been a "right ... over, or in relation to" land within the meaning of s 36 of the AIA, that 47 [2007] 2 Qd R 373. contractual licence to use the Common Areas was not an interest in land within the meaning of s 182 of the LTA, and nothing in Sorrento suggests to the contrary48. Because it was not apt to give rise to an interest in land, cl 6.8 of the Lease cannot be characterised as having been expressed to create an interest in any lot. For that reason, cl 6.8 of the Lease did not, in my opinion, engage s 182 of the LTA. Turning finally to the question of construction, it is important to recognise that the contractual licence conferred by cl 6.8 of the Lease was a contractual licence to use a geographical area. That geographical area was relevantly defined to mean part of former Lot 6, the metes and bounds of which were depicted in a "Plan for Lease Purposes" attached to the Lease. The ability of the lessor to expand or contract the applicable geographical area consistently with cl 15 tells against reading the definition as, in some way, automatically expanding or contracting if former Lot 6 were to cease to exist or if the Lease came to be registered for another lot. The Land Appeal Court was right to conclude that, notwithstanding registration of the Lease for new Lot 1, cl 6.8 applied "only to the area of what was once Lot 6", which did not include the Resumed Land49. 48 [2007] 2 Qd R 373 at 378 [10], 380 [18], 383-385 [35]-[41], 387 [52]. 49 Moreton Bay Regional Council v Mekpine Pty Ltd [2013] QLAC 5 at [57].

HIGH COURT OF AUSTRALIA STATE OF NEW SOUTH WALES APPELLANT AND DC & ANOR RESPONDENTS New South Wales v DC [2017] HCA 22 14 June 2017 ORDER Special leave to appeal in relation to ground 2 of the notice of appeal dated 23 February 2017 revoked. The appellant pay the respondents' costs. On appeal from the Supreme Court of New South Wales Representation N J Williams SC with I L Harvey and L A Coleman for the appellant (instructed by Crown Solicitor (NSW)) A S Morrison SC with J R K Pryde and N F Morrissey for the respondents (instructed by Graham Jones Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS New South Wales v DC Negligence – Duty of care – Statutory power to report abuse of child to police – Where duty of care in exercise of statutory powers conceded – Where scope or extent of duty disputed – Where primary judge found that no authority acting reasonably could regard failure to report abuse to police as reasonable exercise of statutory powers in present case – Where State conceded that only reasonable exercise of statutory powers in some cases may be to report abuse to police – Whether appropriate in light of concessions to consider scope or extent of duty – Special leave to appeal revoked. Tort – Vicarious liability – Where State conceded vicarious liability for breach of duty of care – Where statute providing for vicarious liability of Crown not in force – Where concession may not have reflected applicable law at relevant times – Special leave to appeal revoked. Words and phrases – "duty of care", "scope or extent of duty", "statutory discretionary power", "vicarious liability". Child Welfare Act 1939 (NSW), Pt XIV, s 148B(5). Civil Liability Act 2002 (NSW), s 43A. Law Reform (Vicarious Liability) Act 1983 (NSW), s 8. KIEFEL CJ, BELL, GAGELER, KEANE AND GORDON JJ. Two sisters, the respondents, were subjected to sustained physical and sexual abuse by their stepfather for many years. On or shortly before 20 April 1983, one of the sisters, TB, made a complaint about the abuse to the Department of Youth and Community Services ("the Department"), a department of the appellant, the State of New South Wales. TB and the other sister, DC, were then aged 15 and 12 years respectively. Each was interviewed by a case officer of the Department. At that time, provisions relating to child protection were contained in the now repealed Child Welfare Act 1939 (NSW) ("the CW Act"). The sisters were dealt with by officers of the Department under Pt XIV of the CW Act, entitled "Committal of Neglected or Uncontrollable Children or Young Persons or of Juvenile Offenders", and related provisions. Section 76 in Pt XIV of the CW Act relevantly provided that any officer authorised by the Minister or any constable of police could, without warrant, "apprehend" any child who the officer or police constable had reason to believe was a neglected child. For the purposes of Pt XIV, "[n]eglected child" was defined to include a child who in the opinion of the court1 was "under incompetent or improper guardianship"2. Under s 78, a child apprehended on that basis was to be taken to a shelter (which could include a place of safety3) and brought before a court as soon as practicable. Section 82 set out powers that a court could exercise if it found that a child was a neglected child. Those powers included admonishing and discharging the child; releasing the child on probation; committing the child to the care of some person or the Minister, or to an institution; and releasing the child on terms and conditions as the court thought fit and as were willingly undertaken to be observed by the child's parents, one of the child's parents or another person approved by the court. Section 148B of the CW Act, located in Pt XVII ("Procedure, Penalties and General Provisions"), made provision for notification and reporting. Section 148B(2) relevantly provided that any person who formed the belief upon "Court" was defined as "children's court, and include[d] a magistrate or justices exercising the jurisdiction of a children's court": s 4(1) of the CW Act. 2 par (j) of the definition of "[n]eglected child" in s 72 of the CW Act. 3 See the definition of "[s]helter" in s 4(1) of the CW Act. Bell Gordon reasonable grounds that a child had been assaulted or was a neglected child within the meaning of Pt XIV could notify the Director4 of the Department of their belief and the grounds for it. Section 148B(5) imposed certain statutory duties on, and provided that certain powers could be exercised by, the Director where a notification had been made. In terms, s 148B(5) provided: "Where the Director has been notified under subsection (2) or (3), he shall— promptly cause an investigation to be made into the matters notified to him; and if he is satisfied that the child in respect of whom he was notified may have been assaulted, ill-treated or exposed, take such action as he believes appropriate, which may include reporting those matters to a constable of police." Following the complaint by TB, officers of the Department took immediate steps including interviewing each of the sisters, organising for the sisters to reside temporarily away from the family home and bringing proceedings in the Children's Court seeking findings that each of the sisters was a neglected child. The Department did not report the complaint to the police. In 2008, the sisters commenced proceedings in negligence in the Supreme Court of New South Wales against the State and one of the Department's officers claiming damages for personal injury and mental harm caused by the continued sexual and physical abuse by their stepfather after the Department was notified of the complaint in April 1983. An extension of the limitation period to commence the proceedings was granted. The sisters made no complaint about the steps in fact taken by the Department. Rather, the sisters contended that the Department breached its duty of care to them by not reporting the abuse to the police. In the proceedings, the parties proceeded on the basis that the complaint by TB in April 1983 constituted a notification for the purposes of s 148B(2) and that steps taken by officers of the Department thereafter were in discharge of the "Director" was defined as the permanent head of the Department or any person acting as the permanent head of the Department: see s 4(1) of the CW Act. Bell Gordon powers, duties or functions under s 148B(5). No issue was raised by the State in those proceedings as to whether s 148B was engaged on the facts of the case5. In relation to the claim against the Department, the primary judge6 (Campbell J) found that: the Department owed each sister a duty actionable under the law of negligence to use reasonable care in the exercise of its powers for the protection of children at risk conferred by s 148B(5) of the CW Act; the Department had breached that duty by failing to notify the police of the serious physical and sexual abuse suffered by the sisters; no authority acting reasonably could properly consider the failure to report the abuse of the sisters to the police to be a reasonable exercise of the powers conferred upon it by s 148B(5)(b) of the CW Act7; and the Department reporting the abuse to the police would "in all probability" have led to the stepfather being charged and the sisters thereby being protected from any further abuse. However, the primary judge was not satisfied on the balance of probabilities that the stepfather had continued to abuse the sisters after the abuse he had previously inflicted was notified to the Department. On that basis, his Honour found that the Department's breach was not a necessary condition of the harm suffered by the sisters. In relation to the claim against the officer of the Department, the primary judge concluded that she may have owed the sisters a duty of care in the provision of welfare services but that this duty was not the same as that owed by 5 A matter to which Basten JA would later refer in his reasons on the appeal: DC v State of New South Wales [2016] NSWCA 198 at [40]-[41]; cf at [363]-[367] per Ward JA, [405]-[408] per Sackville AJA. 6 TB v State of New South Wales (2015) Aust Torts Reports ¶82-223. 7 See s 43A of the Civil Liability Act 2002 (NSW). Bell Gordon the Department and that, as the powers in s 148B(5) were not conferred upon her, she owed no duty in relation to their exercise. The primary judge also concluded that if the officer owed a duty in relation to the exercise of the powers conferred by s 148B(5), she discharged that duty by notifying a child protection unit in the Department and reporting the abuse to her superior officers. There was no appeal from those conclusions. The sisters appealed to the Court of Appeal of the Supreme Court of New South Wales8. A majority of the Court of Appeal (Ward JA and Sackville AJA, Basten JA dissenting) overturned the findings of the primary judge on the question of continuing abuse, concluding that the stepfather's abuse of the sisters continued after the complaint to the Department in April 1983. The continuation of the abuse after April 1983 formed the basis for the sisters' claim that they suffered harm, including serious psychiatric injury, because of abuse post dating the complaint to the Department. The majority's finding that the abuse continued after April 1983 was not the subject of the appeal to this Court. The majority of the Court of Appeal held that the Department owed a duty of care to the sisters to take all reasonable steps in the circumstances of the case to protect the sisters from the risk of further physical and sexual abuse (and consequent physical and mental harm) at the hands of the stepfather. That duty was found to have been breached because the Department did not exercise its statutory discretionary power under s 148B(5) of the CW Act to report the abuse to the police. The majority held that the State was therefore liable for the harm that the sisters suffered, including serious psychiatric injury, because of the continuing abuse. Revocation of special leave In its appeal by special leave to this Court, the State did not dispute that, in the exercise of its statutory powers under s 148B(5) of the CW Act, a common law duty was owed by the State to the sisters. The grounds of the State's appeal to this Court encompassed, first, the extent or scope of that duty (ground 2) and, second, if that duty was breached, whether the State was vicariously liable (ground 3). The appeal grounds were expressed in the following terms: 8 DC v State of New South Wales [2016] NSWCA 198. Bell Gordon The Court of Appeal should have found that any duty of care owed to the [sisters] by the [State] through the Director of Child Welfare in 1983 did not extend to exercising a statutory power to report to police allegations of criminality by the [sisters'] stepfather following interviews with the [sisters] by officers of the [State] in April 1983. The Court of Appeal erred in failing to identify the basis upon which the [State] could be held liable by reason of a direct duty owed to the [sisters] or vicariously liable for omissions of an officer or officers of the [State] in circumstances where there was no finding that any such officer was negligent in the performance of any duty." During the course of argument, it came to the attention of the Court that ground 3 was based upon a concession made by the State in its defence to each of the sisters' claims that if the duty owed was breached, the State was vicariously liable for that breach. The Court accepted that the concession was made for good reasons. However, that concession may not have reflected the true state of the applicable law at the relevant times, because the Law Reform (Vicarious Liability) Act 1983 (NSW), which provided (and continues to provide) for vicarious liability of the Crown9, did not commence until 28 October 1983 and did not operate retrospectively. Accordingly, in the circumstances of this matter, ground 3 did not invite elucidation of any legal principle by the Court and special leave to appeal in relation to that ground was revoked. Ground 2 raised a live and contentious issue concerning the scope or extent of the common law duty owed in the exercise of a statutory discretionary power10. After revoking special leave in relation to ground 3, the Court reserved its decision on the question whether special leave to appeal in relation to ground 2 should be revoked until after hearing argument. s 8 of the Law Reform (Vicarious Liability) Act 1983 (NSW). See now s 5 of the Crown Proceedings Act 1988 (NSW); s 4(1) of the Civil Liability Act 2002 (NSW). See also New South Wales v Ibbett (2006) 229 CLR 638; [2006] HCA 57. 10 See TC by his tutor Sabatino v The State of New South Wales [2001] NSWCA 380 at [117]-[125]; DC v State of New South Wales [2010] NSWCA 15 at [48]-[51]. Bell Gordon We consider that special leave to appeal on ground 2 should also be revoked for the reason that the appeal does not squarely raise the question of principle that the State seeks to have this Court determine. The State accepted that there was a common law duty to use reasonable care in the exercise of the powers conferred by s 148B(5) of the CW Act for the protection of children at risk. In relation to the scope or extent of that common law duty, the State further accepted, during the course of argument, that there will be cases where, in the circumstances, the only reasonable exercise of the powers conferred by s 148B(5) would be to report the matter to the police. Here, the primary judge made a finding that, in this particular case, "no authority acting reasonably could properly consider the failure to report the abuse of TB and DC to the police to be a reasonable exercise of the powers conferred upon it" by s 148B(5) of the CW Act (emphasis in original). His Honour held that the failure to report the abuse to the police constituted a breach of duty. Moreover, the primary judge made findings on causation that were not challenged. His Honour found that, if the abuse had been reported to the police, "in all probability" charges would have been laid against the stepfather. His Honour found that there was a "strong possibility" that the stepfather would have been denied bail, and further found that, if bail had been granted, the stepfather would have complied with what would have been stringent conditions as to his conduct whilst on bail awaiting trial. Having regard to the course taken by the State at trial, and in the appeals to the Court of Appeal and to this Court, this case is not an appropriate vehicle for considering the scope or extent of the common law duty owed in the exercise of the powers under the CW Act. Conclusion and orders Special leave to appeal in relation to ground 2 should be revoked. The State should pay the sisters' costs of the proceedings in this Court.

HIGH COURT OF AUSTRALIA GREG COMBET & ANOR PLAINTIFFS AND COMMONWEALTH OF AUSTRALIA & ORS DEFENDANTS Combet v Commonwealth of Australia [2005] HCA 61 Date of order: 29 September 2005 Date of publication of reasons: 21 October 2005 ORDER The questions stated by the parties in the Special Case for the opinion of the Full Court are answered as follows: (1) Q. Do the Plaintiffs, or either of them, have standing to seek the relief sought in the Statement of Claim in the Further Amended Writ of Summons? A. It is unnecessary to answer this question. (2) Q. If yes to (1), is the withdrawal of money from the Treasury of the Commonwealth to pay for the Government's Advertisements authorised by the Departmental Appropriation? A. It is not appropriate to answer this question. (3) Q. If no to (2), have the Plaintiffs established a basis for any, and if so which, of the relief sought in the Amended Statement of Claim? A. The Plaintiffs have not established a basis for any of the relief sought in the Amended Statement of Claim or the alternative relief foreshadowed at the hearing of the Special Case, namely, declarations concerning payments to meet expenses incurred by the Commonwealth under contracts and arrangements for and in relation to certain past advertisements. (4) Q. If yes to (3), should any such relief be refused on discretionary grounds? A. It is unnecessary to answer this question. (5) Q. Who should pay the costs of the proceedings? Representation: S J Gageler SC with J K Kirk for the plaintiffs (instructed by Maurice Blackburn Cashman) D M J Bennett QC, Solicitor-General of the Commonwealth with S B Lloyd and K J Graham for the defendants (instructed by Australian Government Solicitor) Intervener: R J Meadows QC, Solicitor-General for the State of Western Australia with J C Pritchard intervening on behalf of the Attorney-General for the State of Western Australia (instructed by Crown Solicitor's Office (Western Australia)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Combet v Commonwealth of Australia Statutes – Appropriation Act – Construction – Appropriation of moneys from Consolidated Revenue Fund – Expenditure of public money on advertising to provide information about, and promote, the Government's workplace relations reform package – Whether expenditure authorised by an appropriation made by law – Construction of Appropriation Act (No 1) 2005-2006 (Cth) – Whether expenditure falls within Outcome 2, "Higher productivity, higher pay workplaces", of the Department of Employment and Workplace Relations – Whether amounts issued out of Consolidated Revenue Fund for "departmental items" and for "administered items" tied to "outcomes". Constitutional law (Cth) – Appropriation of moneys from Consolidated Revenue Fund – Standing to bring action for declarations and injunctions – Standing of Member of House of Representatives and Shadow Attorney-General – Standing of Secretary of peak union body – Justiciability of proceedings – Whether proceedings present a matter apt for judicial determination. Constitutional law (Cth) – Appropriation of moneys from Consolidated Revenue Fund – Expenditure alleged to be unauthorised by Appropriation Act (No 1) 2005-2006 (Cth) – Relief – Injunction – Declaration – Whether relief claimed effective and confined to the expenditure impugned – Whether relief should be refused on discretionary grounds – Whether necessary or appropriate to answer such questions. High Court – Practice – Special Case – Questions of law stated for the opinion of the Full Court – Matter presented by the arguments of the parties – Whether common assumption in the parties' submissions on questions of statutory construction – Whether Court obliged to decide controversy presented by the parties – Scope and content of that controversy – Extent to which parties' submissions foreclosed construction of the Appropriation Act (No 1) 2005-2006 (Cth). Words and phrases – "appropriation", "appropriation made by law", "administered expenses", "administered item", "departmental expenditure", "departmental item", "departmental outputs", "outcomes". Constitution, ss 53, 54, 56, 81, 83, 94, 97. Appropriation Act (No 1) 2005-2006 (Cth), ss 3, 4, 7, 8, 15, Sched 1. Financial Management and Accountability Act 1997 (Cth), ss 5, 26, 27. Auditor-General Act 1997 (Cth). Audit Act 1901 (Cth), ss 34, 40, 41. Acts Interpretation Act 1901 (Cth), s15AB. GLEESON CJ. Section 83 of the Constitution provides that no money shall be drawn from the Treasury of the Commonwealth except under appropriation made by law. The Special Case says that, in May 2005, the Government announced its intention to introduce a "workplace relations reform package". In response, the Australian Council of Trade Unions instituted "a national campaign opposing the [r]eforms". The Government "has ... engaged and proposes to continue to engage in advertising the purpose of which is to provide information about and promote the [r]eforms". The advertisements have been, and will be, paid for by moneys drawn from the Treasury. The appropriation by law relied upon is that made by the Appropriation Act (No 1) 2005-2006 (Cth) ("the Appropriation Act"). The plaintiffs contend that the Appropriation Act does not cover such drawings. The defendants contend that it does. That is the principal issue to be decided. The question is one of the construction of the Appropriation Act. It is not contended that the Appropriation Act is invalid. Nor is it argued that expenditure of public money, by way of advertising or otherwise, upon the promotion of government policy is inherently unlawful or unconstitutional. In a variety of ways, politicians, in and out of government, constantly engage in publicly funded activity promoting or opposing government policy. Costs of travel undertaken for purposes of political advocacy provide a simple example. Such expenditure may sometimes attract political controversy. Complaints of unfair or inappropriate use of public funds are part of the cut and thrust of political debate. If seen as justified, they may have an electoral impact. Our concern, however, is only with justiciable issues. The issues for decision have been put before the Court in a number of questions formulated in the Special Case. I agree with the answers proposed in the reasons of Gummow, Hayne, Callinan and Heydon JJ ("the joint reasons"). I will, however, state my own reasons. Questions of construction of the Appropriation Act are to be resolved by reference to text and context. The language of the text is controlling, but the meaning of that language is to be understood in a context which includes the Constitution, parliamentary practice, accounting standards, and principles and methods of public administration. The most relevant provisions of the Constitution are ss 53, 54, 81 and 83. The matter of parliamentary appropriation goes to the essence of relations between the Parliament and the Executive, and of relations between the Senate and the House of Representatives. Parliamentary practice comprehends procedures relating to budget estimates, audit, expenditure review, and performance assessment. Such procedures operate in a dynamic, political environment. In public administration, theory and practice change and develop. The Constitution was designed to allow for a necessary degree of flexibility in administrative arrangements1. 1 Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 401-403 [11]-[17]. The Constitution, consistently with the background of constitutional history and parliamentary practice with which the framers were familiar, reserves to the Parliament, and especially the House of Representatives, the power associated with control of funding through appropriation. It is for Parliament, consistently with the Constitution, to decide how it exercises that control. One factor of practical significance is the degree of specificity with which appropriations are made. Section 81 of the Constitution provides for the Consolidated Revenue Fund "to be appropriated for the purposes of the Commonwealth". It is for the Parliament, in making appropriations, to determine what purposes are purposes of the Commonwealth2. It is also for the Parliament to determine the degree of specificity with which such purposes are expressed. "Provided that purposes are stated it is a matter for the Parliament how minute and particular shall be the expression of purposes in any particular case."3 "The purpose of any appropriation may be 'One-line' appropriations are valid."4 In 1936, the Supreme Court of the United States, speaking of the provision of the United States Constitution that corresponds with s 83, said5: indicated generally. "The contention that there has been no constitutional appropriation, or that any attempted appropriation is bad, because the particular uses to which the appropriated money is to be put have not been specified, is without merit. The provision of the Constitution ... that 'No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law' was intended as a restriction upon the disbursing authority of the Executive department, and is without significance here. It means simply that no money can be paid out of the Treasury unless it has been appropriated by an act of Congress. ... The validity of the act disposing of the tax is also attacked as constituting an unlawful delegation of legislative power. That Congress has wide discretion in the matter of prescribing details of expenditures for which it appropriates must, of course, be plain. Appropriation and other acts of Congress are replete with instances of general appropriations of 2 Attorney-General (Vict) v The Commonwealth (1945) 71 CLR 237 at 254 per 3 Victoria v The Commonwealth and Hayden (1975) 134 CLR 338 at 404 per 4 Victoria v The Commonwealth and Hayden (1975) 134 CLR 338 at 422 per 5 Cincinnati Soap Co v United States 301 US 308 at 321-322 (1936). large amounts, to be allotted and expended as directed by designated government agencies." A recent development in the theory and practice of public administration is the trend towards "outcome appropriations" as a means of stating the purposes for which governments spend public money. This was implemented in the "Outcomes are the intended effects of Commonwealth in 1999-2000. government programmes, whereas outputs — the goods and services delivered by government — are the means of achieving those outcomes."6 A suggested benefit of changing the focus of appropriations from outputs to outcomes is the placing of greater emphasis on performance in the public sector7. Outcome appropriation is related to issues of performance assessment. Furthermore, the Financial Management and Accountability Act 1997 (Cth) forms part of the context in which the system operates. The practical manifestation of the system of outcome appropriation in the Appropriations Act will be examined below. Typically, outcomes are stated at a high level of generality. Furthermore, they are commonly expressed in value-laden terms which import political judgment. Parliament is appropriating funds for use by a government, and the outcomes pursued may involve controversial policy judgments. While the generality of statements of outcome may increase the difficulty of contesting the relationship between an appropriation and a drawing, appropriations are made in a context that includes public scrutiny and political debate concerning budget estimates and expenditure review. The higher the level of abstraction, or the greater the scope for political interpretation, involved in a proposed outcome appropriation, the greater may be the detail required by Parliament before appropriating a sum to such a purpose; and the greater may be the scrutiny involved in review of such expenditure after it has occurred. Specificity of appropriation is not the only form of practical control over government expenditure. The political dynamics of estimation and review form part of the setting in which appropriations are sought, and made. 6 Brumby and Robinson, "Performance Budgeting, an Overview", paper delivered at the International Seminar on Performance Budgeting, Brasilia, 2004 at 7 (cited in Webber, "Managing the Public's Money: From Outputs to Outcomes – and Beyond", (2004) 4 OECD Journal on Budgeting 101 at 109). 7 Webber, "Managing the Public's Money: From Outputs to Outcomes – and Beyond", (2004) 4 OECD Journal on Budgeting 101 at 114; Boxall, "Outcomes and Outputs: The New Resource Management Framework", (1998) 88 Canberra Bulletin of Public Administration 39 at 41; Her Majesty's Treasury, Better Accounting for the Taxpayer's Money: Resource Accounting and Budgeting in Government, (1994) Cmnd 2626. Section 53 of the Constitution provides that the Senate may not amend proposed laws appropriating revenue or moneys for the ordinary annual services of government. Legislation appropriating funds for the costs and expenses of maintaining the ordinary annual services of government is dealt with separately from legislation dealing, for example, with extraordinary charges and appropriations. Quick and Garran wrote that "[t]he ordinary annual services include the various public departments manned and equipped to carry on the general work of the Government departments, such as customs and excise, posts and telegraphs, light-houses, light-ships, and quarantine, naval and military defence, the money to pay for which is voted by Parliament from year to year"8. The authors were writing at a time when the role of the Commonwealth was more modest than at present, but the idea they convey remains true. The Appropriation Act, in its long title, is described as an Act to appropriate money out of the Consolidated Revenue Fund for the ordinary annual services of the Government, and for related purposes. The scheme of the Appropriation Act is built around Sched 1, which identifies 16 portfolios including, relevantly, Employment and Workplace Relations, and allocates sums to various agencies within those portfolios, dividing the sums between "Departmental Outputs" and "Administered Expenses". Some insight the distinction between "departmental" and "administered" items or expenses may be gained from Australian Accounting Standard 29 concerning Financial Reporting by Government Departments, written in June 1998: into A government department's operating statement only recognises revenues and expenses of the government department. Similarly, a government department's statement of financial position only recognises assets which the government department controls and liabilities which involve a future sacrifice of the government department's assets. However, the responsibilities of a government department may encompass the levying or collection of taxes, fines and fees, the provision of goods and services at a charge to recipients, and the transfer of funds to eligible beneficiaries. These activities may give rise to revenues and expenses which are not attributable to the government department. ... These administered revenues, expenses, assets and liabilities 8 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, are not recognised in the government department's operating statement or statement of financial position." In the Summary of Appropriations in Sched 1 to the Appropriation Act, the total sum of $47,371,218,000 was divided into $33,788,542,000 for departmental outputs and $13,582,676,000 for administered expenses. The allocations were broken down further into portfolios, and, within portfolios, into agencies. For some agencies, there were departmental outputs but no administered expenses. For some agencies, there were administered expenses but no departmental outputs. For some agencies, there were both. The Appropriation Act, in s 4, refers to Portfolio Budget Statements. This is a defined term, meaning the Portfolio Budget Statements that were tabled in the Senate or the House of Representatives in relation to the Bill for the Appropriation Act (s 3). Those statements, prepared by Ministers for the budget estimates process, contained information on proposed agency activities in support of spending proposed by the Appropriation Bill. Such statements explain and seek to justify the appropriations proposed. They are scrutinised as part of the budget process. They reflect government policy as it affects budgetary planning. Government policy, however, is not frozen over a given budget period. Policies constantly change and develop. Indeed, governments may change during a budget period. Nor is there a clear distinction between "new" policies and modifications of existing policy. In Sched 1 to the Appropriation Act, for each agency of each portfolio there is a statement of an outcome, or a number of outcomes. Reference has already been made to the generality, and political content, of some of these objectives. Furthermore, in most cases, neither departmental outputs (goods and services provided) nor administered expenses could possibly be the sole sources of influence contributing to or bearing upon the stated outcome. For example, within the Foreign Affairs and Trade portfolio, an amount of $49,334,000 is appropriated for the Australian Centre for International Agricultural Research. The relevant outcome is: "Agriculture in developing countries and Australia is more productive and sustainable as a result of better technologies, practices, policies and systems". Plainly, that outcome is likely to be affected by a host of factors beyond the control or influence of the Australian Government. Furthermore, opinions may be divided upon whether agriculture at one time is "more productive and sustainable" than at another, or upon whether certain technologies, practices, policies and systems have been made "better". This is a description, in the broadest political terms, of an objective of governmental activity. Whether a particular form of expenditure on goods or services (output) is likely to contribute to that objective might be contestable. For such a contest to give rise to a justiciable issue, as distinct from a political or scientific controversy, the issue could not be formulated appropriately by stating the outcome and asking whether the expenditure would contribute to it. The generality, and the value-laden content of the outcome would make that impossible. It would be possible to frame an issue in terms of relevance. A court might ask whether a particular expenditure could rationally be regarded as having been made in pursuit of, and as being in that sense related to, the stipulated outcome. A negative answer to that question would need to have due regard to the breadth of expression of the outcome, and to the consideration that the court's capacity issues of policy formation and implementation is likely to be limited. A judge's intuition may be an insecure foundation for a denial of any rational connection between an output and an outcome. judgment about to make a The relevant provisions of the Appropriation Act begin with s 3, a definitions section. The term "administered item" is defined to mean an amount set out in Sched 1 opposite an outcome of an entity under the heading "Administered Expenses". The term "departmental item" is defined to mean the total amount set out in Sched 1 in relation to an entity under the heading "Departmental Outputs". The term "entity" is defined to include an Agency. To give relevant content to those definitions, it is necessary to refer to the first agency item relating to the Employment and Workplace Relations Portfolio in Sched 1. (References to the earlier budget period, 2004-2005, included in the Schedule in italics for purposes of comparison, will be omitted.) EMPLOYMENT AND WORKPLACE RELATIONS PORTFOLIO Appropriation — 2005-2006 Departmental Administered Expenses Outputs DEPARTMENT OF EMPLOYMENT AND WORKPLACE RELATIONS Outcome 1 - Efficient and effective labour market assistance Total Outcome 2 - Higher productivity, higher pay workplaces Outcome 3 - Increased workforce participation Total: Department of Employment and Workplace Relations Applying the definitions in s 3, the relevant departmental item is $1,447,552,000, and the administered items are $1,970,400,000, $90,559,000 and Section 4 of the Appropriation Act provides: "4(1) The Portfolio Budget Statements are hereby declared to be relevant documents for the purposes of section 15AB of the Acts Interpretation Act 1901. If the Portfolio Budget Statements indicate that activities of a particular kind were intended to be treated as activities in respect of a particular outcome, then expenditure for the purpose of carrying out those activities is taken to be expenditure for the purpose of contributing to achieving the outcome." Sections 7 and 8 effect what are described as the basic appropriation for departmental items (s 7) and the basic appropriation for administered items (s 8). The language of s 4(2) ties in with the language of s 8(2). Section 8 relevantly provides: "8(1) For an administered item for an outcome of an entity, the Finance Minister may issue out of the Consolidated Revenue Fund amounts that do not exceed, in total, the lesser of: the amount specified in the item; and the amount determined by the Finance Minister in relation to the item, having regard to the expenses incurred by the entity in the current year in relation to the item. (2) An amount issued out of the Consolidated Revenue Fund for an administered item for an outcome of an entity may only be applied for expenditure for the purpose of carrying out activities for the purpose of contributing to achieving that outcome." As a note to s 4(1) indicates, s 4(1) is intended to relate specifically to s 15AB(2)(g) of the Acts Interpretation Act 1901 (Cth). The Portfolio Budget Statements may be considered to confirm that the meaning of a provision is the ordinary meaning conveyed by the text, or to determine the meaning of a provision when the provision is ambiguous or obscure or where the ordinary meaning conveyed by the text leads to a result that is manifestly absurd or is unreasonable. The focus of argument in the present case has been the departmental item of $1,447,552,000. The basic appropriation of that item is found in s 7, which relevantly provides: "7(1) For a departmental item for an entity, the Finance Minister may issue out of the Consolidated Revenue Fund amounts that do not exceed, in total, the amount specified in the item. (2) An amount issued out of the Consolidated Revenue Fund for a departmental item for an entity may only be applied for the departmental expenditure of the entity." The term "expenditure" is defined in s 3 as meaning payments for expenses, acquiring assets, making loans or paying liabilities. The composite expression "departmental expenditure" is undefined. Unlike ss 4 and 8, s 7 makes no reference to outcomes. Its only reference to purpose is "for the departmental expenditure of the entity." If the plaintiffs are right in their contention, it must be because payment of the advertising expenses in question, out of the amount of $1,447,552,000, involves an application of part of that amount otherwise than for the departmental expenditure of the Department of Employment and Workplace Relations. I accept that the expression "departmental expenditure", in s 7(2), does not mean any expenditure that the Department chooses to make, or incur, or even any expenditure for the purposes of the Commonwealth that the Department chooses to make or incur. Description of the expenditure as "departmental" imports a purposive, as well as a factual, element. That follows from the constitutional context, a matter to which I shall return. At the same time, I do not accept that expenditure cannot be supported under s 7 unless it is referred to in the Portfolio Budget Statement. Such a conclusion would be contrary to the terms of s 4, which are facultative, not limiting. Sub-section (2) of s 4 refers to what Portfolio Budget Statements "indicate". That word itself reflects the practical political context in which such statements are prepared, with the potential for developments and changes both in policy and in circumstances. The Appropriation Act characterises the statements as indicative, and says that if it is indicated that activities of a particular kind were intended to be treated as activities in respect of a particular outcome, then expenditure is taken to be for the purpose of contributing to the outcome. Such a question might arise most clearly in the case of administered items, having regard to the terms of s 8(2). Whether it could also arise under s 7 is an issue. In any event, to say that, if an activity is related to an outcome in the Portfolio Budget Statements, expenditure on that activity is to be taken to be for the purpose of the outcome is very different from saying that it is only expenditure on activities covered by Portfolio Budget Statements that may be taken to be expenditure for the purpose of contributing to achieving the outcome. As to the latter possibility, s 4 says no such thing. Putting to one side the practical difficulties that would arise from treating the Portfolio Budget Statements as definitive of the purposes of the appropriations effected by the Appropriation Act, such a conclusion cannot stand with the language of the Act. In the case of administered items, the relationship between outcome and appropriation is clearly spelled out in the definition of administered item and the terms of s 8, read together with Sched 1. In the case of the Department of Employment and Workplace Relations, there are three administered items (amounts) and three outcomes, and an amount issued out of the Consolidated Revenue Fund must be related (in the sense explained in s 8(2)) to one of those items and to the outcome for which it has been appropriated. We are, however, presently concerned with s 7(2). For the Department of Employment and Workplace Relations there is only one departmental item as defined, $1,447,552,000. An amount issued for that item may only be applied for the departmental expenditure of the Department. Such expenditure must, of course, be for a purpose of the Commonwealth (Constitution, s 81). The long title of the Appropriation Act, understood in the light of s 53 of the Constitution, shows that the expenditure referred to in s 7 is for the ordinary annual services of Government. That, however, is an expression of wide import. Are the outcomes stated in Sched 1 relevant to the characterisation of expenditure as "departmental expenditure" within the meaning of s 7? In my view, they are. The constitutional context in which the Appropriation Act was enacted was one of parliamentary appropriation of funds, under the control of Parliament, to be made available to the Executive for stated purposes. The statement of purposes may be broad or narrow. In Sched 1, amounts under the heading "Departmental Outputs" are related in each case to a statement of outcome. The total of those amounts, for an entity, is a departmental item. It is unlikely that the statements of outcome were intended to be relevant only to administered items, because in the case of some entities or agencies there are statements of outcome, but no administered expenses. I acknowledge that the contrast between the language of s 7(2) and that of s 8(2) could support a view that outcomes are irrelevant to s 7(2). Against that, however, is the wider context, together with the specific textual consideration that Sched 1 identifies outcomes even where there are no relevant administered expenses. In the case of departmental items, the relationship with outcomes is not identical to the relationship between outcomes and administered items spelled out in s 8(2). There is only one departmental item, to which a number of outcomes may be relevant. Taken together, however, outcomes towards which the Department of Employment and Workplace Relations is working assist in considering what is meant by "departmental expenditure". They may exclude expenditure which is so clearly unrelated to the business of the Department that it could not rationally be regarded as expenditure for the purpose of that business. There are probably many aspects of the routine business of the Department, undoubtedly included in the ordinary annual services of the Government, which could be regarded as contributing to one or other of outcomes 1, 2 or 3 only in the most indirect fashion. No doubt much departmental expenditure is of a kind that would be incurred even if the Department were pursuing different policy objectives. Such expenditure may be directed to outputs of a kind that a government of any political persuasion would expect the Department to provide. Policy development and advice to the Minister is an obvious example. Such advice might be directed towards a wholesale re-definition of the outcomes themselves, and yet the cost of providing it would qualify as departmental expenditure. The plaintiffs, in their submissions to the Court, acknowledged that the outcomes listed in Sched 1 "are statements of purpose at a very high level of abstraction". So much is clear. Provided such statements are not so general, or abstract, as to be without meaning, they represent Parliament's lawful choice as to the manner in which it identifies the purpose of an appropriation. To the extent to which it is necessary to have regard to those statements of purpose in order to decide whether expenditure bears the character of departmental expenditure referred to in s 7, then the generality, and the political character, of a statement may make it difficult to establish that particular expenditure is not related to the relevant purpose (in the sense earlier discussed). It does not follow that the purpose should be confined, or stripped of its political content. By what process might such a narrowing legitimately take place? The plaintiffs argued, quoting the Portfolio Budget Statements, that outcome 2 might be narrowed to "providing policy advice and legislation development services to government" and "supporting employers and employees in adopting fair and flexible workplace relations practices". It has already been pointed out that the use of the Portfolio Budget Statements to restrict the generality, and thereby alter the meaning, of the language of the Act, including Sched 1, is inappropriate. If Parliament formulates the purposes of appropriation in broad, general terms, then those terms must be applied with the breadth and generality they bear. Furthermore, if (as appears to be common ground) "providing policy advice and legislation development services to government" serves a purpose described in Sched 1 as "higher productivity, higher pay workplaces", then it is instructive to consider why that is so. If it be accepted (as it is) that "providing policy advice and legislation development services" is one way in which the Department pursues the outcome of "higher productivity, higher pay workplaces", that must be because the outcome is contributed to by development of policy, and formulation of legislation in accordance with such policy or, more precisely, because such activities could rationally be regarded as contributing to the outcome. It is not suggested that this result depends upon whether the policy advice, or proposed legislation, enjoys the approval of the person making the judgment. In the terms of outcome 2, "higher" must mean "higher than would otherwise be the case". Productivity and rates of pay in workplaces are influenced by many factors in addition to government action and legislation. Yet the assumption of Sched 1 is that they may be contributed to by departmental outputs, and the assumption of the Portfolio Budget Statements, and of the plaintiffs' argument, is that policy advice and legislation development services may reasonably be regarded as contributing to that outcome, regardless of the content of the advice or the merits of the legislation. If formulation and development of policy and legislation on the subject of workplace relations is related to "higher productivity, higher pay workplaces", then it is difficult to see why promotion of public acceptance of workplace relations policy and legislative change is not so related. It cannot be the case that it depends upon whether the policy is wise, or the changes constitute genuine reforms. These are political judgments, and the value-laden statements of outcome throughout Sched 1 invite differences of opinion on such questions. In a representative democracy, governments, oppositions, politicians of all persuasions, and interest groups are constantly engaged in political struggle. Public, as well as private, funds are spent, in a variety of ways, on advocacy supporting or opposing proposals for executive action and legislative change. Persuading the public, or a sufficient number of members of the public, of the merits of government policy may be as important to successful formulation and implementation of policy as the drafting of advice and legislation. Persuading the public of the merits of policy and legislation may be vital to the achievement of the desired policy objective. There may be many grounds of political objection to the advertising in question, such as that the proposed changes will not result in "higher productivity, higher pay workplaces", or that a publicly funded advertising campaign is an inappropriate means of advocating such changes. The legal question, however, is whether the drawings in question are covered by the appropriation. The relevant outcome is stated with such breadth as to require an answer to that question adverse to the plaintiffs. Reference has already been made to the long title of the Appropriation Act, the reference in the long title to "the ordinary annual services of the Government", and the constitutional significance of that expression. An argument was advanced with respect to that matter, with particular reference to a history of communications between the Senate and the Minister for Finance on the contents of the annual Appropriation Bill (No 1). The relevant history is traced in the joint reasons. The concept of running costs, and the relationship to that concept of "advertising and public relations services" and "information services" was examined in argument. I agree that the boundaries of the running costs included in departmental expenditure are unclear, and the parliamentary history and practice relied upon does not advance the argument of the plaintiffs. Counsel for the defendants pointed out that the development of new policy cannot be excluded from running costs, especially when regard is had to the possibility of a change of government during a budget period, and the fact that "information activities" may be an integral part of the development of new programmes. It is unnecessary to deal with the questions of the standing of the plaintiffs to bring these proceedings or the form of relief that might have been available had the plaintiffs made good their primary contention. Those questions involve issues of importance and difficulty, but on the view I have taken on the principal question of construction they do not arise. For those reasons I agreed in the order that was made on 29 September McHugh 33 McHUGH J. The issues in this case arise out of a Special Case stated by Gummow J. The principal issue is whether the Appropriation Act (No 1) 2005-2006 (Cth) has authorised the withdrawal of money from the Treasury of the Commonwealth to pay for advertising by the federal government that promotes its industrial relations reform package. In their pleadings, the plaintiffs seek two declarations and an injunction. They seek a declaration that the drawing of money from the Treasury of the Commonwealth to pay for advertisements promoting the workplace relations reform package is not authorised by Appropriation Act (No 1) 2005-2006 ("Act No 1"). They also seek a declaration that the drawing rights issued by a delegate of the third defendant, the Minister for Finance and Administration, under s 27 of the Financial Management and Accountability Act 1997 (Cth) to authorise the payment of public money for advertisements promoting the reform package are invalid. Finally, they seek an injunction restraining the third defendant from issuing any further drawing right under s 27 of the Financial Management and Accountability Act 1997 (Cth) to authorise the payment of public money for advertisements that promote the reform package. In oral argument, however, the plaintiffs said that, if the Court was not prepared to grant the relief sought in their pleadings, it should grant two declarations. First, that the drawing of money from the Treasury for the purpose of making payments to meet expenses incurred by the Commonwealth in relation to past advertisements about the reform package was not authorised by Act No 1. Second, that the drawing rights issued by a delegate of the third defendant on 23 August 2005 have no effect in so far as they purport to authorise the debiting of an amount against the departmental item in respect of the Department of Employment and Workplace Relations in Act No 1 for the purpose of making payments of public money to meet expenses incurred by the Commonwealth in relation to the past advertisements. In my opinion, Act No 1 did not authorise expenditure on this advertising. The defendants contend that it did so because the Act authorised expenditure by the Department of Employment and Workplace Relations on advertising that could reasonably result in higher productivity or higher pay in Australian workplaces. However, the defendants tendered no expert evidence that these advertisements might achieve either result and, after examining them, I can see no rational connection between the advertisements and higher productivity or instruction, higher pay. encouragement or exhortation that could lead to higher productivity or higher pay. The joint judgment of Gummow, Hayne, Callinan and Heydon JJ asserts, despite the contention of the defendants, that it is not necessary that the expenditure be conducive to achieving higher productivity or higher pay or any outcome specified in Act No 1. For the reasons set out in this judgment, however, that assertion cannot be accepted. Not only is it contrary to what was common ground between the plaintiffs and the defendants but it is contrary to the The advertisements provide no information, McHugh language of Act No 1, the parliamentary practice, the parliamentary documents that explain the operation of Act No 1 and the understanding of all members of the Parliament. I venture to think that the joint judgment places a construction on Act No 1 that will surprise all members of the Parliament irrespective of party or ideology. It follows that Act No 1 did not authorise the expenditure of the moneys of the Commonwealth on the advertisements. A declaration to that effect should be made and the defendants should be restrained by injunction from spending the moneys of the Commonwealth on advertisements in the form or to the effect of those already published. The material facts In May 2005, the Prime Minister informed the House of Representatives9 that the federal government intended to legislate to reform workplace relations in Australia by introducing a unified national system. The Prime Minister gave no details of how this would be achieved. When this Court heard argument in the present proceedings, no legislation had been introduced into either House of Parliament to give effect to the proposed changes. In the weeks after the Prime Minister's announcement, the Australian Council of Trade Unions ("the ACTU") began a campaign opposing the proposed reforms. The campaign included rallies and marches and extensive television advertising. On and after 9 July 2005, the first defendant, the Commonwealth, responded to this campaign by publishing advertisements in newspapers in all States and Territories. On and after 23 July 2005, the first defendant also responded to the campaign of the ACTU by broadcasting advertisements on commercial radio stations. As at 15 August 2005, the first defendant had entered into contracts for advertising and related services with a value of at least $3.84 million. The cost of the advertising has been or will be met from public funds drawn from the Treasury of the Commonwealth. Unless restrained by this Court, the first defendant proposes to use funds of the Commonwealth to pay for advertisements concerning its industrial relations package. A copy of one of the first defendant's newspaper advertisements is Annexure "A" to the Special Case. It is a fair sample of the nature of the advertising in question in these proceedings. The advertisement is headed: MORE JOBS HIGHER WAGES A STRONGER ECONOMY 9 Australia, House of Representatives, Parliamentary Debates (Hansard), 26 May McHugh The advertisement asserts that, as a result of Australians working together, the nation has a stronger economy with new jobs and higher real wages and the capacity to provide more health, education, social and community services. It claims that, if Australia is to remain effective in a global economy, more has to be done to keep these benefits. Changes to industrial relations law are therefore needed. The advertisement makes a number of specific claims about the present state of Australian industrial relations and what will happen under the reforms. It asserts that: the Australian government will protect the rights and conditions of Australian workers by legislation; the government will continue to protect workers with a fair and sustainable safety net of wages and conditions; awards will not be abolished but will be updated so they continue to provide modern terms and conditions for those workers who choose not to have a workplace agreement; workers will continue to be protected from unlawful termination including dismissal on discriminatory grounds; it will remain unlawful for workers to be forced to sign an Australian Workplace Agreement (AWA) or be sacked for refusing to sign an AWA; the government's plan will make it simpler and easier for workers and employers to agree on working conditions; workers on AWAs currently earn 13% more than workers on certified agreements, and 100% more than workers on award rates; all agreements will be required by law to meet the new tests set out by the Australian Fair Pay and Conditions Standard; to keep pace with our modern economy the Australian Industrial Relations Commission will focus on dispute resolution and further simplification of awards; Australia currently has six different workplace relations systems and can no longer afford to force employees and employers to work with this complexity; and that Australia needs only one set of national laws to cover workplace relations. McHugh The advertisement concludes by claiming that, by working together, "we will create more jobs, with higher wages in a stronger economy and secure the future for Australian workers and their families." Whether expenditure on the advertisement and those like it was lawfully authorised depends on whether it could promote any of the items – Outcomes 1, 2 and 3 – in Table 1.1 of the Agency Budget Statements for the Department of Employment and Workplace Relations. Those Outcomes are identified as: Efficient and effective labour market assistance Higher productivity, higher pay workplaces Increased workforce participation The issue in the case is one of statutory construction. No question of constitutional law is directly involved although the explanation and the meaning of the text of Act No 1 lie in the history of constitutional conflicts between the Crown and Parliament. They also lie in conflicts between the House of Representatives and the Senate over the Senate's right to amend legislation It will, appropriating money for the purposes of the Commonwealth. unfortunately, be necessary to go beyond an examination of the text of the statute. That is because the joint judgment of four members of the Court has construed Act No 1 in a manner contrary to that asserted by the plaintiffs and relevantly accepted by the defendants. As a result, it will be necessary to set out extracts from various documents in considerable detail to show that the construction that the parties have placed on Act No 1 is correct and that of the joint judgment erroneous. The constitutional background For centuries before the enactment of the Constitution, the Crown conducted the day to day business of government – as theoretically it still does today. But the business of government, ancient and modern, requires access to a continual supply of money. Taxation of the income or property of the subject is an obvious way of raising money for the business of government. Historically, taxation and loans have been the principal means by which governments have raised money. From an early period in the history of English constitutional law, however, the House of Commons insisted on its right to control the levying of direct taxes on the subjects of the Crown and others. It "repeatedly asserted that taxes were not to be imposed without its consent"10. By the 17th century, the House of Commons had also insisted on its right to control the levying of indirect 10 Maitland, The Constitutional History of England, (1908) at 181. McHugh taxation11. These demands of the Commons culminated in the promulgation of the Bill of Rights 1689 (UK) and its insistence "that levying money for or to the use of the Crown by pretence of prerogative, without grant of parliament, for longer time, or in other manner than the same is or shall be granted, is illegal." As a result, for more than three centuries, a fundamental rule of English constitutional law has been that the Crown cannot levy a tax without parliamentary authorisation12. But not only did the Commons insist on controlling the levying of taxes, it also insisted on knowing the purposes for which the Crown intended to use the supply of money and on scrutinising the expenditures of the Crown13. As a result, another fundamental rule of the constitutional law of the Anglo-Australian peoples is that the Crown cannot expend money without the authorisation of Parliament14. When the Constitution was drafted, there was also a widely accepted convention that control over money Bills essentially belonged to the popularly elected lower House of Parliament from which the government was formed. Indeed, as early as the second half of the 17th century the House of Commons had resolved that money Bills should not be amended by the House of Lords and that such Bills could only originate from the Commons15. The Lords could "make no alteration in a money bill, but must simply accept it, or simply reject it".16 Sections 53, 54, 55 and 81 and 83 of our Constitution are the result of these rules of English constitutional law and this convention. Sections 53, 54 and 55 provide: "53. Proposed laws appropriating revenue or moneys, or imposing taxation, shall not originate in the Senate ... 11 Saunders, "Parliamentary Appropriation", in Saunders et al, Current Constitutional Problems in Australia, (1982) 1 at 2. 12 Attorney-General v Wilts United Dairies Ltd (1920) 37 TLR 884 at 886. 13 Maitland, The Constitutional History of England, (1908) at 184, 328. 14 Auckland Harbour Board v The King [1924] AC 318 at 326; Brown v West (1990) 169 CLR 195 at 205. 15 Victoria v The Commonwealth (1975) 134 CLR 338 at 385-386. After 1689, the only power the House of Lords had in respect of money Bills was to withhold assent. 16 Maitland, The Constitutional History of England, (1908) at 247. McHugh The Senate may not amend proposed laws imposing taxation, or proposed laws appropriating revenue or moneys for the ordinary annual services of the Government. The Senate may at any stage return to the House of Representatives any proposed law which the Senate may not amend, requesting, by message, the omission or amendment of any items or provisions therein. And the House of Representatives may, if it thinks fit, make any of such omissions or amendments, with or without modifications. Except as provided in this section, the Senate shall have equal power with the House of Representatives in respect of all proposed laws. The proposed law which appropriates revenue or moneys for the ordinary annual services of the Government shall deal only with such appropriation. Laws imposing taxation shall deal only with the imposition of taxation, and any provision therein dealing with any other matter shall be of no effect." These three sections did not give full effect to the convention that control over money Bills belongs to the popularly elected House where the government is formed. That is because of a compromise made at the 1897 Adelaide Convention. Delegates from South Australia, Western Australia and Tasmania insisted on equal voting rights for the Senate in respect of all legislation passed by the Parliament17. In the end, they gave way in respect of money Bills to the extent provided for in s 53. Their compromise in respect of the "ordinary annual services" of the government reflected a convention that was then current in the United Kingdom and in the colonies of Australia. By the 19th century, the United Kingdom Parliament had adopted a convention that expenditure falling outside the estimates for the ordinary annual expenditure of the government required explicit approval by the Parliament. Thus, expenditures for new purposes not already covered by the existing powers or functions of a department or where the expenditure required authority for more than one year18 required separate approval by the Parliament. In 1857, after a 17 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, 18 Erskine May's Treatise on the Law, Privileges, Proceedings and Usage of Parliament, 20th ed (1983) at 750. McHugh dispute between the House of Assembly and the Legislative Council in South Australia over the powers of the Council in respect of money Bills, the Council agreed to waive its claim that it could deal with appropriations concerning the ordinary annual expenses of government in South Australia19. This convention of the South Australian Parliament – now incorporated in the Constitution Acts of a number of Australian States – was the basis of the s 53 compromise. But as the events of 1975 showed, although the Senate cannot amend proposed laws appropriating revenue or moneys or imposing taxation, the compromise did not extend to failing to pass or rejecting them. Consequently, at the Constitutional Convention held in Sydney some months later, in 1897, s 5720 was inserted in the draft Constitution to resolve deadlocks that might arise as the result of the last paragraph in s 53 of the Constitution. Sections 81 and 83 of the Constitution, however, give full effect to the victory of the Houses of Parliament over the right of the Crown to spend public moneys at the Crown's discretion. They declare: "81. All revenues or moneys raised or received by the Executive Government of the Commonwealth shall form one Consolidated Revenue Fund, to be appropriated for the purposes of the Commonwealth in the manner and subject to the charges and liabilities imposed by this Constitution. 83. No money shall be drawn from the Treasury of the Commonwealth except under appropriation made by law." The appropriations The practice of the federal Parliament in relation to Appropriation Bills is conveniently summarised in Harris, House of Representatives Practice21, which states: "The Parliament appropriates moneys from the Consolidated Revenue Fund on an annual basis in order to fund expenditure by the Government. Prior to 1999 the appropriation of funds by the annual 19 Moore, The Constitution of the Commonwealth of Australia, 2nd ed (1910) at 142- 20 Section 57 is entitled "Disagreement between the Houses". It provides the mechanism for double dissolutions and joint sittings of both Houses of Parliament. 21 5th ed (2005) at 414. McHugh appropriation bills expired at the end of the financial year on 30 June. The annual appropriations, although related to activity in a specific year, no longer lapse at the end of the year – appropriations for departmental expenses are open ended, while appropriations for administered expenses are limited to expenses incurred in that year. Appropriation Bill (No 1) is a key element in 'the Budget'; it contains details of estimates for ordinary annual government services – that is, continuing expenditure by government agencies on services for existing policies. Appropriation Bill (No 2) is also introduced as part of the Budget and appropriates funds for expenditure on new policies, new capital expenditure ..." In 1979, the Joint Committee of Public Accounts of the federal Parliament reported22: "Theoretically, control over both taxation and expenditure lies with Parliament but the right to initiate spending proposals lies with the government. Parliament can debate, examine and criticise the estimates, but must accept or reject the spending proposals as a whole. If they are rejected this is generally taken as a major defeat for the government, leading either to a vote of confidence or a general election. The main role of Parliament is limited to considering the estimates when they have been announced and later conducting a retrospective inquiry into how the money has been spent both in order to ensure compliance and to improve subsequent performance." The legislation with which these proceedings are concerned gives effect to ss 53, 54, 55, 81 and 83 of the Constitution and their underlying policies. Act No 1 gives effect to s 81 of the Constitution by providing for the appropriation of money for the purposes of the Commonwealth for the financial year 2005-2006. That Act and the Appropriation Act (No 2) 2005-2006 (Cth) give effect to the requirements of s 54 of the Constitution. The long title to the Bill that became Act No 1 was "[a] Bill for an Act to appropriate money out of 22 Australia, 179th Report of the Joint Committee of Public Accounts of the Commonwealth Parliament, (1979) at pars 4.10, 4.11 cited in Saunders, "Parliamentary Appropriation", in Saunders et al, Current Constitutional Problems in Australia, (1982) 1 at 13. McHugh the Consolidated Revenue Fund for the ordinary annual services of the Government, and for related purposes". The resolution of these proceedings depends upon the legal significance of a departmental "Outcome". The Outcomes are contained in Schedule 1 of Act No 1. In essence, they set down the goals towards which each department will work during the next year and for which they are provided with funds. The members of this Court who are parties to the joint judgment have reached a different conclusion on this question to that which, in my opinion, is compelled by the weight of the evidence contained in various documents that show what Act No 1 was intended to achieve and how it was to be achieved. In order to demonstrate the true legal effect of these Outcomes, it will be necessary to set out lengthy excerpts of a number of these documents. These include: Budget Paper No 4 for 2005-2006; The Schedule to Act No 1; Documents relating to established parliamentary practice concerning supply Bills; A 1999 letter from the Minister for Finance and Administration to the President of the Senate; A Ministerial advice on compliance with the "Outcomes & Outputs Framework Guidance Document"; and Portfolio Budget Statements. The purpose of the excerpts is to demonstrate that, contrary to the views of the members of the joint judgment, the desired Outcomes that are specified for the Department of Employment and Workplace Relations, operate as a control upon the purposes for which that Department is authorised to make appropriations from the Treasury. The 2005-06 Budget Paper No 4 provides a summary of the framework of the appropriations for that year. It states inter alia: "The annual appropriation bills, portfolio budget statements and agency annual reports are an integrated package showing the allocation of resources to government outcomes by agencies. The portfolio budget statements contain details of the estimated payments under each of the annual special appropriations. ... [T]he appropriation bills declare portfolio budget statements to be relevant documents for statutory interpretation. They can appropriation containing legislation bills and McHugh be referred to if issues arise over how to interpret the associated annual appropriation acts. The portfolio budget statements are prepared by portfolio ministers for the purposes of Senate Legislation Committees' examination of the Government's budget. The statements are published as Budget Related Papers and tabled in the Parliament at budget time. The annual appropriation bills propose the payment of specified amounts by agencies in achieving the government's outcomes. In accordance with the Constitution, appropriations are provided for particular purposes. For all expenses appropriations, those purposes are the outcomes which are shown beside the appropriation amounts. Outcomes are the results or impacts on the community or the environment that the Government intends to achieve. They are specified by the responsible portfolio minister with the endorsement of the Finance Minister. Departmental expenses are appropriated as a single amount for each agency. The single appropriation represents the cost of all the outputs that the agency plans to deliver. Appropriation Bill (No 1) 2005-06 shows a split of that amount across agency outcomes. The split is notional, providing an indication of the departmental resources that will be required to achieve agency outcomes. Administered expenses are those administered by the agency on behalf of the Government. They are normally related to activities governed by eligibility rules and conditions established by the government or Parliament such as grants, subsidies and benefit payments. Agencies have no discretion over how administered expenses are spent. Administered expenses are appropriated separately for agency outcomes (ie the split across outcomes is not notional), specifying precisely how much can be expended on each outcome." (emphasis added) Section 15 of Act No 1 declared: "The Consolidated Revenue Fund is appropriated as necessary for the purposes of this Act." Schedule 1 specified the "Services for which money is appropriated". The Schedule was divided into 16 portfolio items; one of them was described as the "Employment and Workplace Relations" Portfolio. It provided: McHugh EMPLOYMENT AND WORKPLACE RELATIONS PORTFOLIO Appropriation (plain figures) – 2005-2006 Actual Available Appropriation (italic figures) – 2004-2005 Departmental Administered Total Outputs Expenses DEPARTMENT OF EMPLOYMENT AND WORKPLACE RELATIONS Outcome 1 - Efficient and effective labour market assistance 1,235,216 1,970,400 3,205,616 Outcome 2 - Higher productivity, higher pay workplaces 140,131 90,559 230,690 Outcome 3 - Increased workforce participation 72,205 560,642 632,847 Total: Department of 1,447,552 2,621,601 4,069,153 Employment and 633,918 2,337,321 2,971,239 Workplace Relations the The use of terms "Outcome", "Departmental Outputs" and "Administered Expenses" is the result of the change to accrual accounting by the government in 199923. In February 1999, the Minister for Finance and Administration wrote to the President of the Senate informing her of the introduction of accrual budgeting in respect of federal government finance. The Minister said that it "would involve some modest changes to the Appropriation Bills with implications for the 1965 Compact between the Senate and the Executive on what constitutes 'the ordinary annual services of Government'". In 1965 – in what became known as the Compact of 1965 – the Senate had resolved to "reaffirm its constitutional right to amend proposed laws appropriating revenue or moneys for expenditure on all matters not involving the ordinary annual services of the Government". It resolved inter alia: 23 Accrual accounting is the system under which items are brought to account and appear in financial statements as they are earned or incurred in contrast to a system where items are recorded when they are received or paid. For the purposes of these proceedings, the relevance of accrual accounting is simply that its adoption came with the adoption of the Outcomes and Outputs system. McHugh "(2) That appropriations for expenditure on: new policies not previously authorised by special legislation, are not appropriations for the ordinary annual services of the Government and that proposed laws for the appropriation of revenue or moneys for expenditure on the said matters shall be presented to the Senate in a separate Appropriation Bill subject to amendment by the Senate." Much of the rest of the letter from the Minister for Finance and Administration to the President of the Senate must be set out because it makes clear what the "Employment and Workplace Relations Portfolio" of the Department of Employment and Workplace Relations in Act No 1 was intended to achieve. The relevant parts of the letter stated: "The Government will present its 1999-2000 Budget on an accrual basis. The focus on outcomes and outputs under an accrual budget means that the Commonwealth's financial infrastructure needs to be modified. The 1965 Compact has been applied to a cash-based, input focused system to date and needs to be updated for accrual budgeting to be effectively implemented. The Proposal The changes proposed to the Compact are minimal and can be achieved while maintaining the integrity of what was originally agreed in 1965 ... Funds for capital injections, Section 96 Grants to the States and new administered outcomes not previously appropriated for by Parliament would remain in Bill 2. The Structure of appropriations under an accrual framework The introduction of accrual budgeting means that the Commonwealth and its agencies are changing how they plan, budget and report. The focus is on outcomes and outputs, not programs and inputs. For instance, agencies will specify their outcomes and detail the outputs to achieve them. The accrual budgeting reforms change both what is measured and the basis of measurement. As a result, the financial performance of agencies and the Government should become more transparent. Changing to the outcomes and outputs framework has important implications for the structure of Appropriation Bills 1 and 2. The bills will no longer appropriate for the cost of inputs or programs; they will McHugh appropriate funding on the basis of outcomes. ... There are some important changes to be noted: Allocation against Departmental and Administered items For each outcome the total funding for departmental and administered items will be shown. In accordance with accrual accounting principles, departmental expenses are expenses that an agency has control over. These expenses represent the ordinary operating costs of Government Departments and agencies. They include: salaries; operational expenses including depreciation (or asset replacement); accruing employee entitlements. Departmental expenses will be notionally split between outcomes ... thereby providing in the Appropriation Bills an indication of the departmental resources to be allocated towards the achievement of key outcomes for agencies. However, this split will be for information purposes only, with departmental items to be appropriated, as running costs are now, as a single amount for each agency. This will maintain the flexibilities to adjust departmental outputs to take account of emerging priorities available under present running cost arrangements. The single appropriation for departmental items will represent the price to be paid by Government for all the outputs the agency plans to deliver. Administered expenses are expenses that agencies do not have control over and are normally made pursuant to eligibility rules and conditions established by the Government such as grants, subsidies and benefit payments. Annual appropriations for administered expenses would be appropriated on the basis of agency outcomes, making it clear what the funding is intended to achieve rather than the program it is being spent As these passages make clear, both departmental and administered expenses bear a clear connection to the Outcomes specified for each department. I will return later in these reasons to the significance of departmental items being "notionally split between outcomes". The Minister's letter continues: "(ii) Consistency of information between the Appropriation Bills, Portfolio Budget Statements and Annual Reports. McHugh An important change under the accrual budget will be the provision of consistent information in the Appropriation Bills, Portfolio Budget Statements (PBS) and Annual Reports, as all the documents will be presented on an outcomes basis. The lack of linkages between the Bills, PBS and Annual Reports has long been a concern to Parliament. Agency Portfolio Budget Statements (which will be available on Budget night) will contain detailed information on planned performance of outputs and outcomes on the same outcomes basis as the bills. Additionally, information on actual performance will be published on an outcomes basis in agencies annual reports, enabling a clear read between the Bills, PBS and Annual Reports. Not only will Senators and Members be able to make more informed assessments of the merits of appropriation bills using agency PBS, they will be able to assess actual versus planned performance by comparing information on: price, quantity and quality of outputs; and performance indicators for outcomes, in an agency's PBS with actual performance information in its Annual Report. This will improve Parliamentary scrutiny of the Bills and agency performance." (emphasis added) The procedures outlined in the Minister's letter provide information that enables the Senate and others to scrutinise the purpose of appropriations and to check the performance of government agencies. The Senate has no power to amend "proposed laws appropriating revenue or moneys for the ordinary annual services of the Government". Hence, the Senate has a vital interest in knowing whether a particular appropriation is truly expenditure "for the ordinary annual services of the Government". Acting in accordance with its powers under s 53 of the Constitution, the Senate has frequently returned Bills to the House of Representatives with a request to amend or alter them24. In the first year of the sitting of Federal Parliament – in June 1901 – the Senate returned the Consolidated Revenue (Supply) Bill 1901-1902 (No 1) to the House of Representatives25. It was accompanied by a message requesting that House to amend the Bill by listing the items of expenditure comprised in the amounts for which the Bill provided. The House did not return the Bill, but subsequently it sent a second Bill to the Senate that identified the items of expenditure. Since that time, the Appropriation Bills and accompanying papers have sought to give 24 Odgers, Australian Senate Practice, 11th ed (2004), Appendix 6. 25 Odgers, Australian Senate Practice, 11th ed (2004), Appendix 6 at 661. McHugh the Senate sufficient detail to enable the Senate to understand the purpose and objects of the appropriations. Appropriation Bills for the financial years subsequent to 1999-2000 have followed the framework outlined in the Minister's letter of February 1999. To assist departments to comply with the framework, the Department of Finance and Administration has issued a "web-based advice", headed, "The Outcomes & Outputs Framework Guidance Document"26. This advice is also relevant in determining the meaning and construction of the "Employment and Workplace Relations Portfolio" of the Department of Employment and Workplace Relations in Act No 1 and what it was intended to achieve. It is part of the background to Act No 1 and gives content to the Department's Portfolio. Relevant parts of the advice state: "This guide takes the outcomes and outputs framework, first introduced in the 1999 Federal Budget, to the next level of development. It is aimed at practitioners within Commonwealth departments and agencies who have specific questions or issues about the framework and its application. The material in the guide draws on experience to date and differs from earlier advice in several respects. In particular, there is: a greater emphasis on performance information, reporting and management, especially by identifying performance information with the major elements of the framework, that is, outcomes, administered items and departmental outputs; an emphasis on the role of pricing of outputs." Under the heading "Policy & purpose", the advice states: "The outcomes and outputs framework ... helps answer three fundamental questions: What does government want to achieve? (outcomes) How does it achieve this? 26 Budget Paper No 4 laid before both Houses of Parliament on 10 May 2005 contains a link to The Outcomes & Outputs Framework Guidance Document. It is a relevant document for the purposes of s 15AB(1) of the Acts Interpretation Act 1901 (Cth) and may be taken into account in construing Act No 1. McHugh (outputs and administered items) iii How does it know if it is succeeding? (performance reporting) In other words, government delivers benefits to the Australian community (outcomes) primarily through administered items and agencies' goods and services (outputs) which are delivered against specific performance benchmarks or targets (indicators). All Commonwealth agencies are required to report on the basis of an outcomes and outputs framework. The framework has two basic objectives: to improve agencies' corporate governance and enhance public accountability. Managing through outcomes and outputs helps improve decision making and performance by focussing attention on the fundamental questions outlined above." (emphasis added) Under the heading "The framework & how it works", the advice states: "The outcomes and outputs framework is intended to be dynamic and flexible. It works as a decision hierarchy: government (through its ministers and with the assistance of relevant agencies) specifies the outcomes it is seeking to achieve in a given area; these outcomes are specified in terms of the impact government is aiming to have on some aspect of society (eg education), the economy (eg exports) or the national interest (eg defence); Parliament appropriates funds to allow the government to achieve these outcomes through administered items and departmental outputs; items such as grants, transfers and benefit payments are administered on the government's behalf by agencies, with a view to maximising their contribution to the specified outcomes; agencies specify and manage their outputs to maximise their contribution to the achievement of the Government's desired outcomes; McHugh performance indicators are developed to allow scrutiny of the effectiveness (ie the impact of the outputs and administered items on outcomes) and efficiency (especially in terms of the application of administered items and the price, quality and quantity of outputs) and to enable the system to be further developed to improve performance and accountability for results. Outcomes, administered items and outputs form the basis of the Commonwealth's budgetary framework and documentation. Outcome statements define the purpose of appropriations in the Budget Bills, while administered items and departmental outputs are detailed in Portfolio Budget Statements, which form part of the Budget Papers." (emphasis added) Under the heading "Performance indicators", the advice states: "The specification of outcomes and outputs necessitates appropriate performance information. Performance indicators reflect: the effectiveness of contributions to outcomes; the price, quality and quantity of outputs; and the desired characteristics of relevant administered items." Under the heading "Specifying Outcomes", the advice declares: "An 'outcome' is the impact sought or expected by government in a given policy arena. ... Outcome statements also perform a specific legal function by describing the purposes of appropriated funds. 1.1 Policy & purpose Outcome statements serve several purposes. They: define the impacts government expects from the work of the agency as well as administered items it manages; articulate the purpose of the relevant appropriations under the Appropriation Acts of the Commonwealth Budget; delineate the parameters for departmental outputs. All departmental outputs must contribute – directly or indirectly – to the realisation of a specified outcome, including under purchaser/provider arrangements whereby the provider is delivering services to contribute to the purchaser's outcome(s). They must provide the Parliament, external accountability bodies, agency clients, interest groups and the general McHugh public with a clear statement of the broad goals of government and its agencies." (emphasis added) Section 4 of Act No 1 gives statutory effect to the Portfolio Budget Statements to which The Outcomes & Outputs Framework Guidance Document refers. Section 4 declares: "(1) The Portfolio Budget Statements are hereby declared to be relevant documents for the purposes of section 15 AB of the Acts Interpretation Act 1901. If the Portfolio Budget Statements indicate that activities of a particular kind were intended to be treated as activities in respect of a particular outcome, then expenditure for the purpose of carrying out those activities is taken to be expenditure for the purpose of contributing to achieving the outcome." The Portfolio Budget Statements 2005-06 ("PBS") for the Employment and Workplace Relations Portfolio consisted of a 228 page booklet. Under the heading "USER GUIDE", the PBS stated27: "The purpose of the 2005-06 [PBS] is to inform Senators and Members of Parliament of the proposed allocation of resources to government outcomes by agencies within the portfolio. The [PBS] provide sufficient information, explanation and justification to enable Parliament to understand the purpose of each outcome proposed in the Bills." (emphasis added) Under the heading "Section 1: Agency overview", the PBS declares28: "The department's aims are to maximise the ability of working age Australians to participate actively in the workforce; and improve the productive performance of enterprises in Australia. To do this, the department provides the Government with high quality advice and services to achieve three outcomes: efficient and effective labour market assistance; 27 PBS at (ix). 28 PBS at 17. McHugh higher productivity, higher pay workplaces; and increased workforce participation. These outcomes: are integrally linked to the achievement of broader government economic performance, employment and social goals; recognise the requirements for further reform to create competitive workplaces." Section 2 of the PBS contains 13 pages. Table 2.129 in that section "shows the total resources from all origins for 2005-06, including appropriations. The table summarises how revenue will be applied by outcome, administered and departmental classification." Section 3 of the PBS is headed "Agency outcomes". It "explains how the resources identified in Section 2 will be used to deliver outputs and administered items to contribute to the three outcomes for the Department of Employment and Workplace Relations."30 In their submissions, the defendants relied on Outcome 2 – higher productivity, higher pay workplaces – to support the advertising campaign of the Commonwealth that is in issue in these proceedings. It is appropriate to set out lengthy extracts of what the PBS has to say under the heading "Outcome 2". Nine pages of the PBS are directed to this Outcome. They state inter alia: "Outcome 2 activities are directed towards encouraging employer[s] and employees to adopt flexible and modern workplace relations practices. This enables workplaces to be productive and competitive and to offer employees secure jobs that are well paid. Agreement making is at the centre of the workplace relations system. The system is underpinned by a fair safety net and compliance with workplace relations obligations. The department actively contributes to Outcome 2 29 PBS at 19. 30 PBS at 32. McHugh providing policy advice and legislation development services to government; and supporting employers and employees in adopting fair and flexible workplace relations practices. Key priorities for 2005-06 Key priorities for outcome 2 for 2005-06 are to: develop a workplace reform package which implements the Government's policy agenda; continue to pursue reform in the building and construction industry to achieve proper regard for workplace relations and occupational health and safety law; promote agreement-making choices to employers and employees; improve access for employers and employees to workplace information and advice through streamlining operations and innovative information technology applications; intervene in test cases to ensure the safety net is fair and facilitates agreement making; pursue strategic interventions in AIRC and court cases to ensure the objects of the Workplace Relations Act 1996 are protected; progress flexible workplace relations solutions to achieve balance between work and family demands; promote workplace relations initiatives that address the emerging pressures of an ageing workforce; strengthen the operational framework and stakeholder partnerships for the General Employee Entitlements and Redundancy Scheme (GEERS); improve national outcomes in occupational health and safety and workers' compensation; and engage strategically with the International Labour Organisation (ILO) to advance Australia's interests." Earlier in these reasons I referred to the distinction between departmental items and administered items. As is clear from ss 7 and 8 of Act No 1, one distinguishing feature is that the amounts set out against departmental outcomes McHugh are "notional". Those sections give statutory effect to the procedures outlined in the Minister's letter of February 1999. Section 7 provides as follows: "(1) For a departmental item for an entity, the Finance Minister may issue out of the Consolidated Revenue Fund amounts that do not exceed, in total, the amount specified in the item. (2) An amount issued out of the Consolidated Revenue Fund for a departmental item for an entity may only be applied for the departmental expenditure of the entity. an Act provides that an entity must be paid amounts that are appropriated by the Parliament for the purposes of the entity; and Schedule 1 contains a departmental item for that entity; then the Finance Minister, under subsection (1), must issue out of the Consolidated Revenue Fund the full amount specified in the item. Section 3 of Act No 1 defines "departmental item" as "the total amount set out in Schedule 1 in relation to an entity under the heading 'Departmental Outputs'". The definition has a note appended to it which declares: "The amounts set out opposite outcomes, under the heading 'Departmental Outputs', are 'notional'. They are not part of the item, and do not in any way restrict the scope of the expenditure authorised by the item." Section 3 of Act No 1 also defines "expenditure" as "payments for expenses, acquiring assets, making loans or paying liabilities". Section 8 of Act No 1 provides: "(1) For an administered item for an outcome of an entity, the Finance Minister may issue out of the Consolidated Revenue Fund amounts that do not exceed, in total, the lesser of: the amount specified in the item; and the amount determined by the Finance Minister in relation to the item, having regard to the expenses incurred by the entity in the current year in relation to the item. (2) An amount issued out of the Consolidated Revenue Fund for an administered item for an outcome of an entity may only be applied for McHugh expenditure for the purpose of carrying out activities for the purpose of contributing to achieving that outcome. Section 3 defines "administered item" as "an amount set out in Schedule 1 opposite an outcome of an entity under the heading 'Administered Expenses'". Sections 26 and 27 of the Financial Management and Accountability Act 1997 (Cth) regulate the drawing of public money from the Treasury of the Commonwealth. Section 26 makes it an offence for an official or Minister to make payments of public money or to debit an amount against an appropriation or make a request that a debit be made, except as authorised by a valid drawing right. Section 27 empowers the Finance Minister to issue such a drawing right but subsection (5) provides that: "A drawing right has no effect to the extent that it claims to authorise the application of public money in a way that is not authorised by an appropriation." The legal significance of Outcomes In support of the relief sought, the plaintiffs argued that nothing in Act No 1 or the PBS provides any foundation for a claim that that Act authorised the appropriation of moneys for the payment of advertisements in relation to the government's workplace reform package. In their written submissions, the defendants asserted that they proposed to pay for the advertising campaign in reliance on the departmental item for the Department. The defendants specifically pointed to "Outcome 2" – "Higher productivity, higher pay workplaces" – to justify paying for the advertising campaign. In their written submissions, the defendants did not contend that the payments could be justified on some other ground. Throughout the oral argument, the Solicitor-General for the Commonwealth maintained that position. He accepted that to justify the payment of public money for the advertisements, the defendants had to show that the payments could reasonably be regarded as contributing to achieving one or more of the Outcomes referred to in the Employment and Workplace Relations Portfolio. At one stage of the argument, the Solicitor-General, after referring to the Portfolio, said: "So what we have in the Act is a very simple situation in which the three administered items set out against each outcome are items that can only be spent in relation to that outcome, whereas the departmental item, which is the 1.4 billion, can be spent on any or all of the three outcomes. There is no requirement to comply with the breakdown. The breakdown is purely notional." (emphasis added) McHugh When I asked the Solicitor-General whether the effect of his submission was that the Outcomes were not controlling in respect of Departmental Outputs, he answered, "Yes. ... Except to the extent that one must be within one of them." This answer made it clear that, while the defendants contended that the Department did not have to spend the appropriations set out against individual Outcomes, the appropriation for Departmental Outputs had to be spent on one or other of the Outcomes. Later, the Solicitor-General said: "All I am pointing out is that the Act has defined the expenditure in terms of Outcomes. A certain sum of money is limited to Outcome 2 and a certain sum of money can be applied, at departmental discretion, to Outcomes 1, 2 or 3." Earlier in answer to a question from the Chief Justice, the Solicitor- General said that he was "content for present purposes to treat the relevant Outcome as Outcome 2." Counsel for the plaintiffs also agreed that the Department had a discretion as to how to spend the total appropriation for Departmental Outputs, so long as it related to an Outcome. In argument, he said, "the whole of the bottom line of the departmental item is available to be spent on all or any departmental outputs." Hence all parties agreed that expenditure on the advertisements for the proposed workplace reform package was authorised by Act No 1 only if the expenditure was capable of achieving one or more of the Outcomes identified in the Employment and Workplace Relations Portfolio. Neither the defendants nor the plaintiffs contended that the payments were authorised merely because they were Departmental expenditure. However, the joint judgment of the Court fastens on the difference between s 7(2) and s 8(2) to hold that31: "the several amounts of Departmental Outputs which are identified against particular outcomes, and together make up the departmental item, are not tied to expenditure for the purpose of achieving any of the nominated outcomes. The only relevant requirement imposed by the Act is that the departmental item be applied only 'for the departmental expenditure of the entity'. That is, the text of ss 7(2) and 8(2) requires the conclusion that the note appended to the definition of 'departmental item' accurately records the effect of s 7(2) of the Act. 31 Reasons of Gummow, Hayne, Callinan and Heydon JJ at [128]-[129]. McHugh There are two related propositions supported by the statement in the note appended to the definition of 'departmental item'. The note is to the effect that the amounts set out opposite outcomes under the heading 'Departmental Outputs' are 'notional', so that they are not part of the item and do not in any way restrict the scope of the expenditure authorised by the item (emphasis in original). With great respect to the members of the Court who are parties to the joint judgment, these conclusions cannot be supported. There are many reasons why that is so. First, it would mean that the specification of "Outcomes" in the Portfolios of every department – including the Department of Employment and Workplace Relations – in Act No 1 would have no controlling effect whatever on departmental outputs. At best, "Outcomes" would be but pious aspirations which departments could disregard if and when they pleased. A department could spend the total of the departmental outputs for any purpose it liked provided, presumably, that the money was spent for a purpose of the Commonwealth. Given the terms of the Minister's letter of February 1999, The Outcomes & Outputs Framework Guidance Document, the PBS for the Employment and Workplace Relations Portfolio and its "USER GUIDE", the conclusion that the total amount of the "Departmental Outputs" is not restricted to the pursuit of the identified "Outcomes" makes no sense. Second, the construction accepted by the joint judgment is based on the conclusion that "the departmental expenditure of the entity" referred to in s 7(2) is at large. But, even leaving aside the external documents, when s 7(2) is read in the textual context of Act No 1, particularly s 4(2)32 and the Portfolio in Schedule 1, the most natural reading of the phrase is that it is referring to the expenditure of the Department for the purpose of achieving the Outcomes specified in the Portfolio. The effect of s 4(2) is that, if a Portfolio Budget Statement indicates that activities of a particular kind were intended to be treated as activities in respect of a particular outcome, then expenditure on those activities is deemed to contribute to the Outcome. If the construction favoured by the joint judgment is correct, this subsection is redundant so far as "Departmental Outputs" are concerned. On that construction, there is no point in deeming the outputs to contribute to an Outcome because the outputs are not required to contribute to an Outcome. With great respect, it is not credible that Act No 1 authorises the various agencies to make "payments for expenses, acquiring assets, making loans or paying liabilities" without regard to whether such transactions could achieve one 32 Set out earlier in these reasons at [64]. McHugh or more of the Outcomes identified in the Portfolio. If that was the case, there could be no consistent linkage between the Appropriation Bills, the Portfolio Budget Statements and the Annual Reports. There would be no way in which the Annual Reports of agencies could be consistently reconciled with the Portfolio Budget Statements and Appropriation Bills. On the construction that the joint judgment places on the Portfolios of agencies, the actual expenditure incurred by departments might bear little relationship to the Outcomes in their Portfolios or to their Portfolio Budget Statements. In his February 1999 letter, the Minister said that hitherto the "lack of linkages between the Bills, PBS and Annual Reports has long been a concern to Parliament." He said that an "important change under the accrual budget will be the provision of consistent information" in those documents. In his letter, he emphasised that "information on actual performance will be published on an outcomes basis in agencies annual reports, enabling a clear read between the Bills, PBS and Annual Reports." There can be no "clear read" if the construction placed on the Portfolios by the joint judgment is correct. Nor would the "three fundamental questions" set out in The Outcomes & Outputs Framework Guidance Document have any meaning. Those questions were: What does government want to achieve? (outcomes) How does it achieve this? (outputs and administered items) iii. How does it know if it is succeeding? (performance reporting) If the construction favoured by the joint judgment is correct, there would seem to be little point in the Senate scrutinising the appropriations in so far as they dealt with "Departmental Outputs". On that construction, the outputs referred to in the Portfolio Budget Statements might bear no relationship to the actual outputs of the agency in the year succeeding the Senate's scrutiny. Third, it is only the "amounts set out opposite outcomes, under the heading 'Departmental Outputs'" that are "notional". Neither s 7(2) nor the note to that subsection indicate that the Outcomes referred to in the Portfolio are notional. If the "amounts set out opposite outcomes ... do not in any way restrict the scope of expenditure authorised by the item", then presumably a department could choose not to spend anything on that Outcome at all. This cannot be correct because the Outcomes have been set down in the Portfolio as the principal objectives for the Department for the forthcoming year. They therefore McHugh have the force of law as stated objectives for each department and cannot be disregarded in a capricious fashion. Fourth, the text of the Portfolio shows that Departmental Outputs must be related to the Outcomes. The Employment and Workplace Relations Portfolio shows not only the appropriation figures for 2005-2006 but also the actual available appropriation figures for the previous year. The moneys spent on Departmental Outputs for the previous year are segregated in terms of the Outcomes identified in the Portfolio. This is almost conclusive evidence that the Departmental Outputs can only be expended to achieve one or more of the identified Outcomes. If there were any doubt about the requirement that outputs must be related to the identified Outcomes, it is put to rest by the Finance Minister's Orders that set out the requirements and guidance for the preparation of financial statements of Australian government entities33. Section 2D of that document deals with the "Reporting of Outcomes and Outputs". That section states that "[e]ntities in the General Government Sector must disclose in the notes the following tables relating to outcomes and outputs". Table A in that section then requires Administered and Departmental expenses, costs recovered and other external revenues of an entity to be classified under each Outcome "as specified in the Appropriation Acts relevant to the entity." Table B in that section also requires an entity to prepare a separate table showing "each relevant major class" of "Departmental expenses" "for each Outcome ... as specified in the Appropriation Acts relevant to the entity." Accordingly, when agencies furnish their Annual Reports showing how they spent their appropriation, they must itemise the expenditure – including Departmental Outputs – under the Outcomes in the Portfolio. With great respect to the Justices who are parties to the joint judgment, this is a complete answer to the conclusion that the amounts set out opposite Outcomes "do not in any way restrict the scope of the expenditure authorised by the item." Fifth, the construction of s 7 favoured by the joint judgment raises an arguable question of constitutional invalidity. In Attorney-General (Vic) v The Commonwealth34, Latham CJ rejected the notion that there could be valid "appropriations in blank". He said that, if an Act merely authorised a Minister or other person to spend public money without the purpose of the expenditure being stated, it would not be a valid appropriation Act. The construction favoured by the joint judgment contravenes this principle, for it appears to authorise an 33 Financial Management and Accountability Orders (Financial Statements), issued under the Financial Management and Accountability Act 1997 (Cth). 34 (1945) 71 CLR 237 at 253. McHugh agency to spend money on whatever outputs it pleases. Even if the authorisation is read down to confine the expenditure to "the purposes of the Commonwealth", the statement of Latham CJ indicates that the "appropriation" in this case was invalid. A statute of the Federal Parliament should not be construed in a way that gives rise to questions of its constitutional invalidity unless the words of the statute make it clear that such a construction was intended. Sixth, in construing an appropriation statute, the construction placed on it by the Houses of Parliament, as demonstrated by their practices, is a matter of considerable weight. In the present case, the third defendant, the Minister for Finance and Administration, the second defendant, the Minister in charge of the relevant Department, and the second plaintiff, the shadow Attorney-General, all agree that Departmental Outputs can only be expended if they contribute to one or more of the Outcomes identified in the Portfolio. One can safely assume that their agreement reflects the understanding of members of the Parliament as to the manner in which appropriation Acts operate. Their agreement is not decisive. It is for this Court to determine the meaning of Act No 1. But if there is any ambiguity in s 7(2) – and I do not think that there is – it should be resolved in accordance with their common understanding. Accordingly, the parties to these proceedings correctly construed s 7(2) and the Portfolio as authorising only those Departmental Outputs which contribute to one or more of the Outcomes identified in the Portfolio. The advertisements were not authorised by the Appropriation Act (No 1) In their written submissions, the defendants contended that "the subject matter, scope and purpose of the appropriation Act make it clear that spending is authorised where a relevant official can reasonably conclude that spending is capable of achieving the outcome." In broad terms, this submission is correct. However, the better way of stating the issues is to say that the expenditure is authorised if there is a rational connection between the spending and the outcome. I also think that the defendants are correct in contending that the Portfolio Budget Statements do not exhaust the expenditures that an agency may incur to achieve an outcome. The argument of the plaintiffs to the contrary is inconsistent with the parliamentary practice in respect of expenditures that contribute to an Outcome although not specified in a PBS. However, even accepting these contentions of the defendants, I find it impossible to conclude that there is any rational connection between the advertisements and Outcome 2 – which was the Outcome upon which the defendants relied. There is simply nothing in the advertisements that could result in an increase in productivity or wages. On their face, the advertisements are concerned to reassure members of the public – and workers in particular – that, under the reform package, workers will not be worse off and that there will be McHugh more jobs and higher wages for Australian workers and their families. The defendants tendered no expert evidence that "feel good" advertisements of this kind will increase the number of units of goods or services produced per worker or will induce employers to pay higher wages. In the absence of such evidence, I can see no connection – rational or otherwise – between the advertisements and higher productivity or higher wages. There is not a scintilla of material in the advertisements that could be construed as instructing workers to produce goods or services more efficiently or that could induce employers to pay higher wages. The advertisements do not instruct, encourage or exhort workers to increase productivity or employers to raise wages. The advertisements provide no information concerning techniques, products, processes or machinery that might increase the production of goods or services by workers. They provide no assistance to employers in obtaining skilled workers or to employees in obtaining skills that might increase productivity. They provide no information that might help employers to reduce costs or to increase revenue or production with a consequent increase in profit margins and higher wages. Moreover, there is nothing in the PBS that is deemed to represent Outcome 2 that would justify the advertisements. The defendants asserted that the advertisements were supported by the activity, "develop a workplace reform package which implements the Government's policy agenda". But these advertisements do not develop such a package. The "key priorities", including that priority, are concerned with matters of substance. They "are directed towards encouraging employer[s] and employees to adopt flexible and modern workplace relations practice." They are not directed to the public generally or to promoting the image of the government. Developing a workplace reform package to implement the government's policy means developing a body of doctrine that can be transformed into law or industrial practice and change the present state of workplace relations so that they become more flexible and consistent with contemporary needs. The Portfolio Budget Statements contain numerous illustrations of the difference between policy initiatives and providing information – such as is found in advertisements – where the provision of information is a matter of substance. A department needs no specific authority to advertise as long as it contributes to one of the Outcomes. But these advertisements do not do so. Where advertisements do not have a rational connection with the specified Outcome, they are only authorised where they are deemed to have that connection by being specifically referred to in the PBS. Advertising or any general description that would cover advertising is not mentioned in the Department's PBS. The advertisements appear to be political in nature. They appear designed to win support for government policy or, at least, to negate the impact of criticism of that policy. Nothing in them provides any support for the conclusion that somehow by some means the advertisements will contribute to achieving higher productivity or higher pay workplaces. In my opinion, there is no rational connection between the advertisements and Outcome 2. It follows that the defendants had no lawful authority to draw McHugh funds from the Treasury of the Commonwealth to finance the advertisements in question. Standing The defendants contended that neither plaintiff has standing to obtain a declaration concerning the validity of the payments or an injunction to restrain the third defendant from issuing drawing rights to authorise the payment of public money for the advertising campaign. The first plaintiff is the Secretary of the ACTU. In British Medical Association v The Commonwealth35, Dixon J doubted that the Federal Council of the British Medical Association in Australia, one of whose objects was to advance the general interests of the medical profession in Australia, had standing to challenge federal legislation that imposed a form of civil conscription within the meaning of s 51(xxiiiA) of the Constitution. His Honour said36 that it "may be doubted whether this body has, as a corporation, a sufficient material interest, which would be prejudiced by the operation of the Act, to give it a title to maintain the suit". Similarly, in The Real Estate Institute of NSW v Blair37, Latham CJ, Starke J and Dixon J were of the opinion that the Real Estate Institute of NSW had no standing to challenge legislation that made provision for the housing of members and ex-members of the armed forces. Their Honours thought that the Institute, in contrast to its members, had no material interest in the operation of the legislation. By parity of reasoning, the ACTU has no material interest in the operation of Act No 1. The Secretary of the ACTU is even further removed from the operation of the Act. It may be that the decisions and dicta in British Medical Association v The Commonwealth and The Real Estate Institute of NSW v Blair require reconsideration in the light of subsequent developments in the law of "standing" in relation to general law matters. It is not necessary, however, to determine whether the first plaintiff has standing. In my opinion, the second plaintiff as the shadow Attorney-General of the Commonwealth has sufficient interest in the proceedings to give her standing to bring these proceedings. The second plaintiff is a member of the House of Representatives. Her status as a member is expressly recognised by the Constitution38. She voted for or against or could have voted for or against Act No 1. She has a special interest in ensuring that public moneys are not expended inconsistently with the terms of Act No 1 passed by the Parliament of which she is a member. Furthermore, she 35 (1949) 79 CLR 201 at 257. 36 (1949) 79 CLR 201 at 257. 37 (1946) 73 CLR 213 at 224, 226, 228. 38 Sections 24, 26, 27 and 29-39. McHugh is seeking an injunction to restrain an officer of the Commonwealth from acting in contravention of the law and s 83 of the Constitution. Her action is brought under s 75(v) of the Constitution. The remedy of injunction available under that paragraph of s 75 is one of three remedies that the paragraph makes available against officers of the Commonwealth. Another remedy under that paragraph is "prohibition", a remedy that even under the general law is available, subject to exercise of the Court's discretion, to a stranger to the issue. If a stranger can obtain a writ of prohibition under s 75(v), it is difficult to see why, subject to the Court's discretion, a stranger cannot obtain an injunction under that paragraph. In many cases to which s 75(v) applies, the distinction between a writ of prohibition and a writ of injunction will be elusive. Accordingly, the second plaintiff has standing to bring these proceedings. Relief In Victoria v The Commonwealth and Hayden (the "AAP case"), Jacobs J referred to the problem of identifying "any expenditure which is impugned and to frame a prayer for relief in terms which will enjoin that expenditure and that only"39. Relying on that passage, the defendants contended that, even if expenditure on the advertisements for the workplace reform package were not authorised by Act No 1, it was not possible to frame an injunction against the defendants that had utility. During argument, I put to the Solicitor-General for the Commonwealth that an injunction could be framed "restraining the third defendant from issuing any drawing right under section 27 of the Financial Management and Accountability Act purporting to authorise the payment of moneys for the purpose of advertisement in the form, or to the effect, of annexure A". The Solicitor-General replied that such an injunction would be too narrow to have any utility. However, such an injunction would restrain the third defendant from authorising payments for advertisements of the kind involved in these proceedings. In addition, a declaration to the effect that drawing rights already made or intended to be made were not authorised by Act No 1 would indicate to the defendants that expenditure on advertisements of the kind in question in these proceedings is unlawful. It would assist them in determining the nature of advertisements that are authorised by Act No 1. Accordingly, the Court should issue an injunction under s 75(v) of the Constitution to the effect set out above. It should also make a declaration as set out above. Since this is a dissenting judgment, it is unnecessary to draft the precise form of the injunction and declaration that I favour. 39 (1975) 134 CLR 338 at 411. McHugh Orders The questions asked in the Special Case for the opinion of the Full Court should be answered as follows: The second plaintiff. The second plaintiff is entitled to the declaration and injunction described in these reasons. The defendants. Callinan 102 GUMMOW, HAYNE, CALLINAN AND HEYDON JJ. The issues presented by this Special Case turn upon interpretation of an appropriation law of the Commonwealth rather law. than upon any alleged Nevertheless, an understanding of the issues is assisted by reference at the outset to two provisions of Ch 4 of the Constitution. invalidity of that Section 81 of the Constitution makes two relevant provisions. First, "[a]ll revenues or moneys raised or received by the Executive Government of the Commonwealth shall form one Consolidated Revenue Fund". Secondly, the Consolidated Revenue Fund is "to be appropriated for the purposes of the Commonwealth in the manner and subject to the charges and liabilities imposed" by the Constitution. Section 83 then forbids drawing money from the Treasury of the Commonwealth "except under appropriation made by law". Thus, appropriations have two relevant characteristics – that they are appropriations for the purposes of the Commonwealth, and that they are appropriations made by law (not by vote or resolution of either or both Houses of the Parliament). The first plaintiff, Mr Combet, is secretary of the Australian Council of Trade Unions, the peak representative body for trade unions in Australia. The second plaintiff, Ms Roxon, is a member of the House of Representatives and Shadow Attorney-General. On 26 May 2005, the Prime Minister, in a ministerial statement in the House of Representatives40, announced that the Government intended to introduce legislation that would reform the way in which workplace relations are regulated in Australia. The statement gave a broad description of what was proposed. It was said that a new body, the Australian Fair Pay Commission, would be established to set a single adult minimum wage. It was said that the Government would work towards a unified national system governing workplace relations. No details were given of how a unified system would be achieved. No Bill to give effect to the changes was then introduced into either House of the federal Parliament and none had been introduced by the time oral argument of the present matter was heard in this Court. The plaintiffs contend that expenditure of public money on advertising to provide information about, and promote, the Government's workplace relations reform package is unlawful. They contend that the expenditure is unlawful 40 Australia, House of Representatives, Parliamentary Debates (Hansard), 26 May Callinan because there is no "appropriation made by law"41 which would authorise the drawing of money from the Treasury of the Commonwealth to pay for that advertising. The plaintiffs' contentions were founded upon a construction of the relevant Act (the Appropriation Act (No 1) 2005-2006 (Cth)) that should not be accepted. As these reasons will demonstrate, the text of the Act does not bear the meaning asserted by the plaintiffs. Neither the constitutional framework which underpins the Act nor federal parliamentary practice support the plaintiffs' contentions about the construction of the Act. The relief sought By their amended pleading the plaintiffs seek declarations and an injunction. They claim: a declaration that the drawing of money from the Treasury of the Commonwealth to pay for advertisements promoting the workplace relations reform package announced on 26 May 2005 is not authorised by the departmental item for the Department of Employment and Workplace Relations ("the Department") in Appropriation Act (No 1) 2005-2006; a declaration that the drawing rights issued by a delegate of the third defendant (the Minister for Finance and Administration) under s 27 of the Financial Management and Accountability Act 1997 (Cth) ("the Financial Management Act")42 purporting to authorise the payment of public money 41 Constitution, s 83. 42 So far as relevant, s 27 now provides: "(1) The Finance Minister may issue a drawing right to an official or Minister that authorises the official or Minister to do one or more of the following: (a) make a payment of public money for a specified purpose; (b) request the debiting of an amount against a particular appropriation; (c) debit an amount against a particular appropriation. (Footnote continues on next page) Callinan for the purpose of advertisements promoting that reform package on the authority of the departmental item for the Department in Appropriation Act (No 1) 2005-2006 are invalid; and an injunction restraining the third defendant, by himself or his delegates, from issuing any further drawing right under s 27 of the Financial Management Act purporting to authorise the payment of public money for the purpose of any advertisement promoting that reform package on the authority of the departmental item for the Department in Appropriation Act (No 1) 2005-2006. It is to be noted that each of these three forms of relief focuses upon the "departmental item" for the Department in Appropriation Act (No 1) 2005-2006. It will be necessary, later in these reasons, to identify the meaning given in the Act to the expression "departmental item", and the way in which the Act treats appropriations for departmental items. At the end of oral argument the plaintiffs indicated that if the Court were to conclude that the relief sought in their amended pleading should not be granted, the Court should grant declarations: that the drawing of money from the Treasury for the purpose of making payments to meet expenses incurred by the Commonwealth under contracts and arrangements for and to certain past advertisements about the reform package is not authorised by the appropriation that has been mentioned; and in relation that the drawing rights issued by a delegate of the Minister for Finance and Administration on 23 August 2005 under s 27 of the Financial Management Act are of no effect in so far as they purport to authorise the debiting of an amount against the departmental item in respect of the Department in Appropriation Act (No 1) 2005-2006 for the purpose of making payments of public money to meet expenses incurred by the Commonwealth under contracts and arrangements for and in relation to those past advertisements. (5) A drawing right has no effect to the extent that it claims to authorise the application of public money in a way that is not authorised by an appropriation." Callinan The questions and answers The parties joined in stating questions of law in the form of a Special Case for the opinion of the Full Court43. For that purpose they agreed certain facts. The questions were: "(1) Do the Plaintiffs, or either of them, have standing to seek the relief sought in the Statement of Claim in the Further Amended Writ of Summons? If yes to (1), is the withdrawal of money from the Treasury of the Commonwealth to pay for the Government's Advertisements authorised by the Departmental Appropriation? If no to (2), have the Plaintiffs established a basis for any, and if so which, of the relief sought in the Amended Statement of Claim? If yes to (3), should any such relief be refused on discretionary grounds? (5) Who should pay the costs of the proceedings?" It is unnecessary to answer the first question (about standing). It is inappropriate to answer the second question (which asks, in general terms not connected to the particular arguments advanced in this matter, whether the withdrawal of money from the Treasury is authorised by the departmental appropriation). Question 3 should be answered: "The Plaintiffs have not established a basis for any of the relief sought in the Amended Statement of Claim or the alternative relief foreshadowed at the hearing of the Special Case, namely, declarations concerning payments to meet expenses incurred by the Commonwealth under contracts and arrangements for and in relation to certain past advertisements". It is unnecessary to answer question 4 (which was predicated upon an affirmative answer to question 3). Question 5 (about costs) should be answered: "The Plaintiffs." The nature of the parties' principal contentions The plaintiffs' contention that expenditure of public money on advertising about the reform package is unlawful was a contention about the proper construction of the Appropriation Act (No 1) 2005-2006. They did not contend 43 High Court Rules 2004, r 27.08. Callinan that there could be no appropriation for payment for government advertising as a purpose of the Commonwealth within the meaning of s 81 of the Constitution. Given the reasoning in New South Wales v Bardolph44, that is unsurprising. Their contention was there was no appropriation, not there could never be an appropriation. In support of their contentions about how the Appropriation Act (No 1) 2005-2006 should be construed, the plaintiffs made extensive reference to the constitutional provisions which regulate the relations between the two Houses of the federal Parliament in connection with money Bills, the provisions of Ch 4 of the Constitution concerning finance, and current and past practices in the federal Parliament. The defendants joined issue with the plaintiffs not only on the ultimate question of construction of the Appropriation Act (No 1) 2005-2006 but also on some aspects of what the plaintiffs asserted to be relevant parliamentary practices of the federal Parliament. And the defendants also contended that the plaintiffs had no standing to maintain the present proceedings. As indicated earlier, it will be unnecessary to examine the question of standing. Appropriation Act (No 1) 2005-2006 The long title of the Appropriation Act (No 1) 2005-2006 was "An Act to appropriate money out of the Consolidated Revenue Fund for the ordinary annual services of the Government, and for related purposes." Section 15 provided that "[t]he Consolidated Revenue Fund is appropriated as necessary for the purposes of this Act". Schedule 1 identified the "[s]ervices for which money is appropriated" and did so by 16 portfolios, one of which was Employment and Workplace Relations. The total of the items specified in Sched 1 was $47,371,218,00045. Of that, $4,153,551,000 was dealt with under the heading of the Employment and Workplace Relations Portfolio. As the summary of that portfolio, set out in Sched 1, showed, six agencies were dealt with under the portfolio heading: the Department, the Australian Industrial Registry, Comcare, the Equal Opportunity for Women in the the National Workplace Agency, Occupational Health and Safety Commission. For the Department, separate Indigenous Business Australia, and 44 (1934) 52 CLR 455. Callinan provisions were made for "Departmental Outputs" and for "Administered Expenses". For the other five agencies dealt with under the portfolio heading, amounts were specified in the "Departmental Outputs" column but not in the "Administered Expenses" column. This situation was not peculiar to the treatment in Sched 1 of the Employment and Workplace Relations portfolio. Other instances are found, for example, in the treatment of agencies under the Attorney-General's portfolio and the Education, Science and Training portfolio. For the Department of Employment and Workplace Relations, separate amounts for Departmental Outputs and Administered Expenses were specified against each of three "Outcomes". These were laid out in Sched 1 as follows: EMPLOYMENT AND WORKPLACE RELATIONS PORTFOLIO Appropriation (plain figures)–2005-2006 Actual Available Appropriation (italic figures)–2004-2005 Departmental Administered Outputs Expenses Total DEPARTMENT OF EMPLOYMENT AND WORKPLACE RELATIONS Outcome 1 – Efficient and effective labour market assistance Outcome 2 – Higher productivity, higher pay workplaces Outcome 3 – Increased workforce participation Total: Department of Employment and Workplace Relations In these proceedings, attention was given principally to Outcome 2: "Higher productivity, higher pay workplaces". The plaintiffs contended that the determinative question in the case is whether expenditure on advertising the Government's reform package fell within this outcome. They contended that answering that question required an examination of the Portfolio Budget Statements for the Employment and Workplace Relations Portfolio that had been Callinan tabled in both the House of Representatives and the Senate in relation to the Bill for the Appropriation Act (No 1) 2005-2006. This followed, so the plaintiffs submitted, from the provision in s 4(1) of the Appropriation Act (No 1) 2005-2006 that the Portfolio Budget Statements tabled in relation to the Bill were "declared to be relevant documents for the purposes of section 15AB of the Acts Interpretation Act 1901"46. The plaintiffs submitted that neither the words of Outcome 2, nor what was set out in the Portfolio Budget Statements, encompassed expenditure of the kind now in question. The text of the Appropriation Act (No 1) 2005-2006 It is important to begin by examining and construing the text of the Appropriation Act (No 1) 2005-2006. That examination reveals that the premise from which the plaintiffs' arguments proceeded is flawed. On its true 46 Section 15AB, so far as now relevant, provides: "(1) Subject to subsection (3), in the interpretation of a provision of an Act, if any material not forming part of the Act is capable of assisting in the ascertainment of the meaning of the provision, consideration may be given to that material: to confirm that the meaning of the provision is the ordinary meaning conveyed by the text of the provision taking into account its context in the Act and the purpose or object underlying the Act; or (b) to determine the meaning of the provision when: the provision is ambiguous or obscure; or (ii) the ordinary meaning conveyed by the text of the provision taking into account its context in the Act and the purpose or object underlying the Act leads to a result that is manifestly absurd or is unreasonable. (2) Without limiting the generality of subsection (1), the material that may be considered in accordance with that subsection in the interpretation of a provision of an Act includes: (g) any document (whether or not a document to which a preceding paragraph applies) that is declared by the Act to be a relevant document for the purposes of this section". Callinan construction the Act does not bear the meaning asserted by the plaintiffs. Although some of the arguments advanced by the defendants assumed the validity of this premise for the plaintiffs' argument, the defendants submitted that it was flawed47. Indeed, much of the oral argument put by junior counsel for the defendants was directed to demonstrating its error by analysing the way in which drafting practices reflected in the Appropriation Act (No 1) 2005-2006 had developed with the changes made in government budget and accounting practices over the last 25 years. To explain why the premise for the plaintiffs' arguments is flawed, it is necessary to pay close attention to the text of ss 4, 7 and 848 and to four different expressions used in the Act. 47 [2005] HCA Trans 650 at 5010-5086. 48 Those sections, and the notes printed with the sections, read as follows: "4 Portfolio Budget Statements (1) The Portfolio Budget Statements are hereby declared to be relevant documents for the purposes of section 15AB of the Acts Interpretation Act 1901. Note: See paragraph 15AB(2)(g) of the Acts Interpretation Act 1901. If the Portfolio Budget Statements indicate that activities of a particular kind were intended to be treated as activities in respect of a particular outcome, then expenditure for the purpose of carrying out those activities is taken to be expenditure for the purpose of contributing to achieving the outcome. 7 Departmental items—basic appropriation (1) For a departmental item for an entity, the Finance Minister may issue out of the Consolidated Revenue Fund amounts that do not exceed, in total, the amount specified in the item. Note: Generally, the Finance Minister is permitted, but not obliged, to issue the amounts out of the Consolidated Revenue Fund. However, subsections (3) and (4) impose an obligation on the Finance Minister to issue the amounts in certain circumstances. (Footnote continues on next page) Callinan (2) An amount issued out of the Consolidated Revenue Fund for a departmental item for an entity may only be applied for the departmental expenditure of the entity. (emphasis added) Note: The acquisition of new departmental assets will usually be funded from an other departmental item (in another Appropriation Act). an Act provides that an entity must be paid amounts that are appropriated by the Parliament for the purposes of the entity; and (b) Schedule 1 contains a departmental item for that entity; then the Finance Minister, under subsection (1), must issue out of the Consolidated Revenue Fund the full amount specified in the item. If a departmental item for an Agency includes provision for payment of remuneration and allowances to the holder of: a public office Remuneration Tribunal Act 1973); or (within the meaning of the an office specified in a Schedule to the Remuneration and Allowances Act 1990; then the Finance Minister, under subsection (1), must issue out of the Consolidated Revenue Fund, under that item, amounts that are sufficient to pay the remuneration and allowances and must apply the amounts for that purpose. 8 Administered items—basic appropriation (1) For an administered item for an outcome of an entity, the Finance Minister may issue out of the Consolidated Revenue Fund amounts that do not exceed, in total, the lesser of: the amount specified in the item; and the amount determined by the Finance Minister in relation to the item, having regard to the expenses incurred by the entity in the current year in relation to the item. (Footnote continues on next page) Callinan The four different expressions are "departmental item", "Departmental Outputs", "administered item" and "Administered Expenses". "[D]epartmental item" is defined49 as "the total amount set out in Schedule 1 in relation to an entity under the heading 'Departmental Outputs'". A note is appended to that definition. It is not part of the Act but is relevant to its construction50 and it will be necessary to refer to it again in these reasons. The note states: "The amounts set out opposite outcomes, under the heading 'Departmental Outputs', are 'notional'. They are not part of the item, and they do not in any way restrict the scope of the expenditure authorised by the item." The definition of "departmental item" is to be contrasted with the definition of "administered item". The latter is defined in s 3 as "an amount set out in Schedule 1 opposite an outcome of an entity under the heading 'Administered Expenses'" (emphasis added). As noted earlier, Sched 1 to the Act tabulates appropriations in columns headed "Departmental Outputs", "Administered Expenses", and "Total", and in rows specifying "outcomes". But provisions in the body of the Act (notably ss 7 and 8) refer to departmental items and administered items. That is, they refer, in the first case, to the total amount under the heading Departmental Outputs and, in the second, to each of the amounts set out in the Schedule under the heading of Administered Expenses opposite an outcome. (2) An amount issued out of the Consolidated Revenue Fund for an administered item for an outcome of an entity may only be applied for expenditure for the purpose of carrying out activities for the purpose of contributing to achieving that outcome. (emphasis added) Note: The acquisition of new administered assets will usually be funded from an administered assets and liabilities item (in another Appropriation Act). (3) A determination made under paragraph (1)(b) is not a legislative instrument." 50 Acts Interpretation Act 1901 (Cth), s 15AB(2)(a). Callinan The distinction between departmental items and administered items is of critical importance for the outcome of this case. Section 7 makes radically different provision for the way in which amounts issued out of the Consolidated Revenue Fund for a departmental item may be applied, from the provision made by s 8 for the way in which amounts issued out of the Consolidated Revenue Fund for an administered item may be applied. Section 7(2) requires that an amount issued out of the Consolidated Revenue Fund for a departmental item for an entity (here the Department) may be applied "only … for the departmental expenditure of the entity". By contrast, s 8(2) provides that an amount issued out of the Consolidated Revenue Fund for an administered item "may only be applied for expenditure for the purpose of carrying out activities for the purpose of contributing to achieving" the outcome to which the amount is attributed. Departmental items are not tied to outcomes; administered items are. It is this contrast between s 7(2) and s 8(2) which provides the starting point for the reasoning which governs the outcome of this case. The course of argument in this Court does not foreclose consideration of the construction of s 7(2) and s 8(2) in this way. As noted earlier, the principal weight of the plaintiffs' case was placed upon the proposition that the impugned expenditures would not, or did not, fall within Outcome 2. And in response, the defendants sought to meet that proposition directly. In that sense, but only in that sense, a deal of the defendants' argument assumed that it was relevant to ask, as the plaintiffs did, whether the impugned expenditures fall within Outcome 2. But the defendants did not confine their arguments to seeking to meet the plaintiffs' arguments about the reach of Outcome 2. In the course of oral argument, close attention was directed to the different provisions made by the Act for departmental items and administered items. The Solicitor-General submitted51 that the stated outcomes did not restrict the scope of expenditure authorised by the appropriation for the departmental item. And as earlier noted, junior counsel for the defendants developed this point by reference to some aspects of the history of federal appropriation acts. The premise for the plaintiffs' argument was thus put in issue. In reply, the plaintiffs sought to counter the submissions of the Solicitor-General by contending that departmental expenditure must relate to one or other of the three Departmental Outputs. 51 [2005] HCA Trans 650 at 5010-5086. Callinan The contrast to be drawn between s 7(2) and s 8(2) reveals no textual basis to support the plaintiffs' submission. Rather, the text of these provisions requires the conclusion that the several amounts of Departmental Outputs which are identified against particular outcomes, and together make up the departmental item, are not tied to expenditure for the purpose of achieving any of the nominated outcomes. The only relevant requirement imposed by the Act is that the departmental item be applied only "for the departmental expenditure of the entity". That is, the text of ss 7(2) and 8(2) requires the conclusion that the note appended to the definition of "departmental item" accurately records the effect of s 7(2) of the Act. There are two related propositions supported by the statement in the note appended to the definition of "departmental item". The note is to the effect that the amounts set out opposite outcomes under the heading "Departmental Outputs" are "notional", so that they are not part of the item and do not in any way restrict the scope of the expenditure authorised by the item (emphasis added). The first proposition is that a sum stated for a Departmental Output does not form part of the departmental item whether or not a particular agency has only Departmental Outputs and has no Administered Expenses. The outcomes stated throughout Sched 1 cannot assist the characterisation of expenditures as "departmental expenditure", whether or not in respect of the entity or agency in question there are no Administered Expenses. The text of ss 7 and 8 of the Act, which has been considered above, points strongly against such a result and the note confirms it. The second proposition is that no contrary conclusion as to the significance of the note is to be drawn from the use therein of the phrase "amounts set out opposite outcomes" rather than an expression that the outcomes themselves are "notional" (emphasis added). To conclude that the only flexibility afforded by s 7 and the current system of appropriations is the freedom for Departments of State to transfer sums between the identified outcomes for each departmental item would be to ignore the reference in the note to the "scope of the expenditure" authorised by the departmental item itself. Mere amounts may restrict the quantum, but not the scope, of an authorised expenditure. It would not have been necessary to indicate in the note that the amounts set out opposite the stated outcomes do not in any way restrict the scope of the expenditure authorised by the item unless neither the numerical amounts provided nor the outcomes to which they are tied should be taken to fetter the scope of the expenditure authorised by a departmental item. Callinan Moreover, contrary to the plaintiffs' submissions, s 4 of the Act requires no different understanding of the Act's operation in relation to a departmental item. In particular, s 4(2) does not require that a departmental item be applied to activities in respect of any or all of the outcomes stated in Sched 1 to the Act. Section 4(2) does extend the activities that are to be regarded as contributing to achieving an outcome. It provides that if Portfolio Budget Statements indicate that activities of a particular kind were intended to be treated as activities in respect of a particular outcome, then expenditure for the purpose of carrying out those activities is taken to be expenditure for the purpose of contributing to achieving that outcome. But s 4(2) has no application with respect to departmental items. It has no application because the Act treats departmental items and administered items differently. The former need not be applied to activities in respect of a designated outcome; the latter must. A departmental item may be expended only on "departmental expenditure". And it will be recalled that the relief which the plaintiffs have sought is framed by reference to the appropriation for the departmental item in respect of the Department. These conclusions about the textual construction of the Appropriation Act (No 1) 2005-2006 require the rejection of the plaintiffs' central contention. And no separate submission was made by the plaintiffs that, on this construction of the Act, expenditure on advertising the Government's reform package would not be a "departmental expenditure". If this is the proper construction of the Act it is not necessary to deal with the defendants' contentions that expenditure on advertising the Government's reform package does, in any event, fall within Outcome 2. That the plaintiffs' submissions in answer to the challenge to the validity of the premise underpinning their principal contention were not lengthy does not relieve the Court of its obligation to construe the Appropriation Act (No 1) 2005-2006. And as has now been said so often52, that requires close attention to 52 See, for example, Roy Morgan Research Centre Pty Ltd v Commissioner of State Revenue (Vict) (2001) 207 CLR 72 at 77 [9] per Gaudron, Gummow, Hayne and Callinan JJ, 89 [46] per Kirby J; Victorian Workcover Authority v Esso Australia Ltd (2001) 207 CLR 520 at 526 [11] per Gleeson CJ, Gummow, Hayne and Callinan JJ, 545 [63] per Kirby J; Commonwealth v Yarmirr (2001) 208 CLR 1 at 37-39 [11]-[15] per Gleeson CJ, Gaudron, Gummow and Hayne JJ, 111-112 [249] per Kirby J; Visy Paper Pty Ltd v Australian Competition and Consumer Commission (2003) 216 CLR 1 at 6-7 [7]-[9] per Gleeson CJ, McHugh, Gummow and Hayne JJ; Stevens v Kabushiki Kaisha Sony Computer Entertainment [2005] HCA 58 at [30] per Gleeson CJ, Gummow, Hayne and Heydon JJ. Callinan the statutory text rather than secondary materials. Likewise, the fact that the plaintiffs did not make any separate or additional submission about what is a "departmental expenditure" does not mean that the challenge to the premise for their principal argument is unfounded. In particular, the construction of the Act adopted in these reasons does not mean, and the plaintiffs did not contend that it meant, that the appropriation for the departmental item is an "appropriation in blank"53, and it is not necessary to consider what, precisely, that expression is intended to convey. The appropriations made by the Appropriation Act (No 1) 2005-2006 were, and were expressed54 to be, appropriations for the purposes of that Act. Those purposes included the purpose of appropriating a sum of money for the departmental expenditure of one of the departments of State of the Commonwealth. That is a purpose of the Commonwealth within s 81 of the Constitution. And as noted earlier, the plaintiffs made no separate submission that the impugned expenditure would not be a "departmental expenditure". Conclusions respecting construction of the legislation These may be expressed as follows: The entry in Sched 1 under the heading "Department of Employment and Workplace Relations" has columns headed "Departmental Outputs" and "Administered Expenses". (ii) With respective reference to these expressions, the statute distinguishes between "departmental items" and "administered items". (iii) Amounts issued for a departmental item may only be applied for departmental expenditure. (iv) On the other hand, amounts issued for an administered item for an outcome may only be applied for expenditure for the purpose of carrying out activities to contribute to achieving that outcome. (v) Outcomes appear in Sched 1 with respect to both departmental items and administered items. 53 Attorney-General (Vict) v The Commonwealth (1945) 71 CLR 237 at 253 per Callinan (vi) But, in so far as they are linked to departmental items, outcomes are not part of that item and do not restrict the scope of the authorised expenditure. (vii) Contrary to the plaintiffs' case, the question for decision is not whether the advertising expenditure answers one or more of the stipulated outcomes but whether it is applied for departmental expenditure. (viii) Satisfaction of that criterion is not challenged by the plaintiffs. It is, however, important to recognise, and deal with, several broader contentions made on behalf of the plaintiffs in support of their general proposition that the Appropriation Act (No 1) 2005-2006 should not be construed as authorising the impugned expenditure because so to construe the Act would diminish, if not eliminate, a necessary level of parliamentary control over expenditure by, or drawing rights issued to, the Executive Government. That general proposition was put in a number of ways in the course of argument but each amounted to the proposition that "the purpose identified in the law [appropriating money] must be a purpose that was notified to the Parliament [and] that was therefore capable of being scrutinised by the Parliament". This general proposition was said to be supported by consideration of the relevant constitutional provisions and past parliamentary practice. It is convenient to begin by looking at those constitutional provisions that lead to the enactment of an appropriation Act. Chapter 4 of the Constitution Reference was made at the beginning of these reasons to ss 81 and 83 of the Constitution and to the propositions that appropriations are for the purposes of the Commonwealth and that they are made by law. Two other provisions of Ch 4 of the Constitution are relevant to a proper understanding of the system of appropriation for which the Constitution provides. They are ss 94 and 97. First, s 94 empowered the Parliament (after five years from the imposition of uniform duties of customs) to provide "on such basis as it deems fair, for the monthly payment to the several States of all surplus revenue of the Commonwealth". The possibility may now appear to be remote that the federal Parliament would provide for the distribution of surplus revenue55. Nonetheless, s 94 emphasises 55 cf New South Wales v The Commonwealth ("the Surplus Revenue Case") (1908) 7 CLR 179. Callinan the importance, to other integers of the federation, of the prohibition in s 83 against drawing from the Treasury except under appropriation made by law. Section 97, on the other hand, is important because it emphasises that ss 81 and 83 are directed to regulating the relationship, in matters of finance, between the Executive and the Parliament. Section 97 provides for the review and audit of receipts and expenditures on account of the Commonwealth. Until the Parliament otherwise provided, colonial laws with respect to the receipt of revenue and expenditure of money on account of the government and the review and audit of receipt and expenditure were to apply to the receipt of revenue and expenditure of money on account of the Commonwealth. And s 51(xxxvi) gave to the federal Parliament power to make laws with respect to a matter "in respect of which this Constitution makes provision until the Parliament otherwise provides". In fact, one of the earliest statutes enacted by the federal Parliament was the Audit Act 1901 (Cth) (Act No 4 of 1901). But what the audit process required by s 97 reveals is that the constitutional provisions about finance were constructed on the basis that the Executive's expenditure of money was to be reviewed by an office holder who, under the colonial arrangements mentioned in s 97, had been obliged to report to Parliament the results of that review. Part 5 of Ch 1 of the Constitution The provisions of Ch 4 to which reference has been made must also be understood in the light of those provisions of Pt 5 of Ch 1 (in particular ss 53, 54 and 56) which regulate the relations between the two Houses of the federal Parliament in respect of money Bills. Each of those three sections deals with proposed laws appropriating revenue or moneys. They are directed, therefore, to steps taken within the Houses of Parliament before the law is made. Four aspects of ss 53, 54 and 56 are of importance for present purposes. First, there are those aspects of s 53 which forbid the Senate amending proposed laws appropriating revenue or moneys "for the ordinary annual services of the Government", but permit the Senate to return such a law to the House of Representatives requesting omission or amendment of any item or provision. Secondly, s 53 provides that "[p]roposed laws appropriating revenue or moneys … shall not originate in the Senate". Thirdly, s 54 provides that a proposed law which appropriates revenue or moneys for the ordinary annual services of the Government "shall deal only with such appropriation". Finally, there is the provision in s 56 that "unless the purpose of the appropriation has in the same session been recommended by message of the Governor-General to the House in which the proposal originated" a vote, resolution, or proposed law for the appropriation of revenue or moneys shall not be passed. Callinan What thus is revealed is not only that appropriations "for the ordinary annual services of the Government" are treated as a distinct class of appropriation (in respect of which the Senate has no power of amendment) but also that it is the Executive Government which begins the process of appropriation. This the Executive Government does by specifying the purpose of the appropriation by message to the House of Representatives. In the present case, the message recommended that an appropriation be made "for the purposes of a Bill for an Act to appropriate money out of the Consolidated Revenue Fund for the ordinary annual services of the Government, and for related purposes" and identified that Bill as the Appropriation Bill (No 1) 2005-2006. As noted earlier, what became s 15 of the Act appropriated the Consolidated Revenue Fund "as necessary for the purposes of this Act". The purposes of the appropriation were "the purposes of [the] Act". Audit Examination and construction of an appropriation Act must also take account of the way in which effect has been given to the constitutional provision for the "review and audit of … the receipt of revenue and the expenditure of money on account of the Commonwealth"56. In particular, it must be recognised that provision was made in the colonial audit legislation57 referred to in s 97 of the Constitution, and in the federal legislation enacted immediately after federation, for the review and audit of expenditure of public money by the holder of an office independent of control by the Executive and accountable to Parliament. Thus, the Audit Act 1901, as originally enacted, provided58 that the Auditor-General for the Commonwealth was to hold office during good behaviour and could be removed from office only upon an address to the Governor-General by both Houses of the Parliament. It further provided59 that money was to be paid out of the Treasury under warrant. The warrant was to set out, by reference to the relevant appropriation that had been made by law, the services or purposes for which the money was required. The warrant was to be signed by the Auditor-General, but only if that officer was satisfied that the money was legally available for, and applicable to, the services or purposes stated in the warrant. 57 For example, Audit Act 1898 (NSW), Pt III, ss 30-46. Callinan Many changes were made to federal audit legislation over succeeding years. It is not necessary to trace them. But until the enactment of the Financial Management Act in 1997 and the repeal of the Audit Act 1901 in that year60 there were two central features of the federal audit legislation. First, money was not to be paid out of the Consolidated Revenue Fund save on the written certification of an officer that moneys were lawfully available for the payment61. Section 34(3) of the Audit Act 1901 made plain that moneys were not lawfully available unless, in the case of a payment from the Consolidated Revenue Fund, moneys sufficient for the payment were "available from a relevant appropriation of that Fund". Secondly, the Auditor-General was bound to audit the "accounts and records of receipts of, and payments out of, public moneys"62 and not only "ascertain whether the moneys shown therein to have been disbursed were lawfully available for expenditure in respect of the service or purpose to which they have been applied or charged"63, but also "ascertain whether the provisions of the Constitution … relating to public moneys have been in all respects complied with"64. The office of Auditor-General was not abolished with the repeal of the Audit Act 1901. Rather, the Auditor-General Act 1997 (Cth) provided for the office and provided65 that the Auditor-General "is an independent officer of the Parliament". Although appointed for a term of 10 years66, the Auditor-General could be removed from office only on an address of both Houses "on the ground of misbehaviour or physical or mental incapacity"67, or upon bankruptcy68. The 60 Audit (Transitional and Miscellaneous) Amendment Act 1997 (Cth), Sched 1, item 1. 61 Audit Act 1901 (Cth), s 34(2) and (3). 62 Audit Act, s 40. 63 s 41(1)(a). 64 s 41(1)(b). 66 Auditor-General Act 1997 (Cth), Sched 1, cl 1(1). 67 Sched 1, cl 6(1). 68 Sched 1, cl 6(2). Callinan Auditor-General's functions include auditing financial statements of "Agencies" in accordance with the Financial Management Act. Under that latter Act, "Agencies" include69 "a Department of State" (an expression evidently derived from s 64 of the Constitution and its reference to the Governor-General appointing "officers the Commonwealth as the Governor-General in Council may establish"). to administer such departments of State of Part 4 of the Financial Management Act70 deals with what the heading of the Part calls "Accounting, appropriations and payments". Division 2 of Pt 471 deals with "Drawing rights". Section 26 prohibits certain conduct "except as authorised by a valid drawing right". It now provides: "An official or Minister must not do any of the following except as authorised by a valid drawing right: (a) make a payment of public money; request that an amount be debited against an appropriation; debit an amount against an appropriation. Maximum penalty: Imprisonment for 2 years." Section 27 regulates the issue of drawing rights. The text of the relevant provisions of s 27 is set out earlier in these reasons. It will be recalled that s 27(1) permits the Finance Minister to issue a drawing right to an official or Minister that authorises making a payment of public money for a specified purpose, requesting the debiting of an amount against a particular appropriation or debiting an amount against a particular appropriation. It will also be recalled that s 27(5) provides that "[a] drawing right has no effect to the extent that it claims to authorise the application of public money in a way that is not authorised by an appropriation". 69 Financial Management and Accountability Act 1997 (Cth), s 5. Callinan The ordinary annual services of the Government The plaintiffs emphasised what they contended to be an established parliamentary understanding of what is an appropriation "for the ordinary annual services of the Government"72. They contended that the expression is one which does not encompass appropriations for new policies. Because the Appropriation Act (No 1) 2005-2006 was an Act to appropriate money for the ordinary annual services of the Government it followed, so the plaintiffs submitted, that the Act should not, or at least should not readily, be construed as making an appropriation to advertise a "reform package", let alone one in respect of which draft implementing legislation had not been prepared. There is a long history of debate between the two Houses of the federal Parliament about what is meant by "the ordinary annual services of the Government". As Odgers recorded in the 1972 edition of Australian Senate "In the early debates of 1901-2 it was quickly asserted by the Senate that it had the right to amend appropriations for public works and buildings and the practice was established of presenting to the Parliament two appropriation Bills, one for the ordinary annual services and another for works and buildings. The former was a Bill which the Senate may not amend, but the Senate exercised the right of amendment in respect of the works and buildings Bill". This distinction between appropriation Bills was noticed in The Commonwealth v Colonial Ammunition Co Ltd74, but in that case no conclusion was drawn that was founded on the distinction. Rather, attention was directed to the "financial, not regulative"75 object of an appropriation Act. From time to time, particularly in the early 1950s and early 1960s, questions arose, both between the two Houses and within the Senate, about what proposed laws should be understood as falling within the prohibition against Senate amendment, contained in s 53 of the Constitution, or about how the 72 Constitution, ss 53, 54. 73 Odgers, Australian Senate Practice, 4th ed (1972) at 324. 74 (1924) 34 CLR 198 at 220-221 per Isaacs and Rich JJ. 75 (1924) 34 CLR 198 at 224 per Isaacs and Rich JJ. Callinan Government should frame its appropriation Bills. In 1965, the two Houses reached an accommodation which has come to be known as the "Compact of 1965". Its terms were reflected in a statement76 made to the House of Representatives by the then Treasurer, Mr Holt, on the second reading of the Supply Bill (No 1) 1965-1966. In particular, it was agreed that one appropriation Bill would be presented for the ordinary annual services of the Government and that a separate Bill would be presented containing appropriations for expenditure the construction of public works and buildings; the acquisition of sites and buildings; items of plant and equipment which are clearly definable as capital expenditure; grants to the States under s 96 of the Constitution; and new policies not authorised by special legislation. This second Bill would be regarded as not for the ordinary annual services of the Government and thus subject to amendment in the Senate. It was further agreed, however, that subsequent appropriations for the last category of items, "new policies not authorised by special legislation", would be included in an appropriation Bill not subject to amendment by the Senate. Writing in the 1972 edition of Australian Senate Practice, Odgers said77 of the inclusion of this last category of expenditure (new policies not authorised by special legislation) in a Bill amenable to amendment by the Senate, that: "One of the virtues of this practice is that Parliament is thereby protected from the possibility of appropriations for any new policies not being readily identifiable in an omnibus Appropriation Bill. Members of both Houses can approach a consideration of the annual appropriations sure in the knowledge that only appropriations for services already approved are included in one Appropriation Bill, while those for any new policies not 76 Australia, House of Representatives, Parliamentary Debates (Hansard), 13 May Callinan previously authorised attract the searchlight of attention in a separate Bill." Subsequently, during the mid-1970s, questions arose about whether certain appropriations should be included in one or other of the two Bills78. It is not necessary to pause to examine those particular questions. Rather, it is enough to notice that the Senate resolved, on 17 February 1977, to reaffirm that appropriations for (among other things) "new policies not previously authorised by special legislation" were not appropriations for the ordinary annual services of the Government79. It is then necessary to notice two subsequent developments, the first in the 1980s and the second in the 1990s. In 1986, the Government decided to introduce what was called the "running costs" system of appropriations with effect from the 1987-1988 financial year. The nature of the change that was made is sufficiently illustrated by comparing the Appropriation Act (No 1) 1986-1987 (Cth) with the Appropriation Act (No 1) 1987-1988 (Cth). In relation to the Department of Employment and Industrial Relations the 1986-1987 Act appropriated a the "ADMINISTRATIVE" expenses of that department. Those administrative expenses were divided between "Salaries and Payments in the nature of Salary", "Administrative Expenses", and "Other Services". By contrast, the 1987-1988 Act divided the "ADMINISTRATIVE" appropriation for what was by then the Department of Employment, Education and Training into "Running Costs" and "Other Services". That is, in the 1987-1988 year, appropriations for salaries, administrative expenses and operational expenses of the relevant department of State were consolidated into a single "running cost" appropriation. total of $777,028,000 for what were described as During 1987, in correspondence between the then Minister for Finance and the then President of the Senate, there was discussion about whether "minor outlays for equipment and accommodation fit-out, of an ongoing nature might not also be more appropriately funded from running costs". The President concurred in the proposal to include these items in running cost appropriations, saying that he did not see the inclusion of such expenditures in the 78 Australia, Senate Standing Committee on Constitutional and Legal Affairs, Report on the Ordinary Annual Services of the Government, June 1976 at 5. 79 Australia, Senate, Journals of the Senate, 1976-1977, No 82, 17 February 1977 at Callinan non-amendable Bill "as a reinterpretation or a modification of the concept of ordinary annual services or of the Compact of 1965". In the 1990s, the Government decided to have Government accounts and the Budget prepared on an accruals rather than cash basis. Accounting and budgeting on an accruals basis, rather than by reference to cash receipts and expenditures, led to reconsideration of the Compact of 1965. In March 1999, the Senate Standing Committee on Appropriations and Staffing reported to the Senate that the Minister for Finance and Administration had proposed that the classification of appropriations under the Compact of 1965 remain unchanged except in three respects80. The alterations proposed were that: items regarded as equity injections and loans be regarded as not part of the ordinary annual services; all appropriation items for continuing activities for which appropriations have been made in the past be regarded as part of ordinary annual services; and all appropriations for existing asset replacement be regarded as provision for depreciation and part of ordinary annual services. The Committee reported to the Senate that it considered that no objections to those changes arose from the constitutional provisions or from the terms of the Compact of 1965 and that "[i]n the context of accrual budgeting, the proposed changes are in accordance with the spirit of both the constitutional provisions and the Compact"81. that recommendation82. Subsequently, to endorse the Senate resolved The significance to be attached to parliamentary practice The Constitution makes the references it does to proposed laws appropriating revenue or moneys for the ordinary annual services of the 80 Australia, Senate, Standing Committee on Appropriations and Staffing, Thirtieth Report, March 1999 at 3. 81 Australia, Senate, Standing Committee on Appropriations and Staffing, Thirtieth Report, March 1999 at 3. 82 Australia, Senate, Journals of the Senate, 1998-1999, No 34, 22 April 1999 at 776. Callinan Government for the purpose of regulating relations between the two Houses of the federal Parliament. It is unnecessary to decide whether a dispute about the application of those aspects of ss 53 and 54 could give rise to a matter to be decided by this Court83. Nor is it necessary to decide what limits there may be to the use that might be made in construing an appropriation Act of exchanges between the Houses, Ministers and presiding officers of the kind that have been described above. In that latter regard, no party submitted that the limited reliance placed on parliamentary practice in the reasons of the Court in Brown v West84 was inappropriate. It is unnecessary to decide these questions because what does emerge from consideration of the Compact of 1965 and subsequent events is the difficulty of marking any clear boundary around the types of expenditure that after 1987-1988 were included within the "running costs" appropriation for a department, or, since the adoption of accrual accounting and budgeting, fall within a "departmental item". Rather, as counsel for the defendants submitted, neither the Compact of 1965 in its original form, nor in the form it now takes, sheds any useful light on that question. For the reasons given earlier, the determinative question in the present matter is not, as the plaintiffs submitted, what is encompassed by "Higher productivity, higher pay workplaces" (Outcome 2). Rather, the Appropriation Act (No 1) 2005-2006 required that money issued out of the Consolidated Revenue Fund for a departmental item be applied only for the departmental expenditure of the entity. Making an appropriation for a departmental item that may be applied only for an entity's departmental expenditure (not otherwise specified or identified) does not represent any radical departure from previous federal parliamentary practice. As the Portfolio Budget Statements for the Department said in its "User Guide", under present budget and accounting arrangements, "departmental items" are: "Assets, liabilities, revenues and expenses in relation to an agency or authority that are controlled by the agency. Departmental expenses 83 See Permanent Trustee Australia Ltd v Commissioner of State Revenue (2004) 79 ALJR 146 at 153-154 [40]-[41] per Gleeson CJ, Gummow, Hayne, Callinan and Heydon JJ; 211 ALR 18 at 28-29. 84 (1990) 169 CLR 195 at 211. Callinan include employee and supplier expenses and other administrative costs, which are incurred by the agency in providing its goods and services." (emphasis added) By contrast, "administered items" are: "Revenues, expenses, assets and liabilities that are managed by an agency or authority on behalf of the Government according to set government directions. Administered expenses include subsidies, grants and personal benefit payments and administered revenues include taxes, fees, fines and excises." (emphasis added) As counsel for the defendants rightly submitted, it is important to recognise that the immediate predecessor to the present system of appropriations was the making of a single lump sum appropriation for "running costs" of a department. And there is a very long history of the federal Parliament making appropriations that are not more closely identified than as being for the purpose of departmental expenditure. Indeed, the very first Act passed by the federal Parliament (an Act to grant and apply out of the Consolidated Revenue Fund a specified sum to the service of the period ending on 30 June 1901) contained items such as "For the Maintenance of the Department of the Minister of Defence" which, although divided into sums of expenditure in each State, were not further allocated between purposes or activities. Further, as noted earlier, immediately before the adoption of the running costs system, the appropriation for the maintenance of departments contained a large sum not specified further than as "Administrative Expenses". It is for the Parliament to identify the degree of specificity with which the purpose of an appropriation is identified85. It may readily be accepted that the constitutional provisions examined earlier in these reasons are to be understood as providing for what, in 1903, was said in relation to the House of Commons86 to be "a comprehensive and continuous guardianship over the whole finance" of the Commonwealth. But the manner of exercising that guardianship, within the relevant constitutional limits, is to be determined by the Parliament. In that 85 Surplus Revenue Case (1908) 7 CLR 179 at 200 per Isaacs J; Attorney-General (Vict) v The Commonwealth (1945) 71 CLR 237 at 253, 256 per Latham CJ; Victoria v The Commonwealth and Hayden (1975) 134 CLR 338 at 404 per Jacobs J; cf Cincinnati Soap Co v United States 301 US 308 (1937) at 321-322. 86 Redlich, The Procedure of the House of Commons, (1908), vol 3 at 170. Callinan regard it is essential to recall, as Mason J pointed out in Victoria v The Commonwealth and Hayden87, that: "It has been the practice, born of practical necessity, in this country and in the United Kingdom, to give but a short description of the particular items dealt with in an Appropriation Act. No other course is feasible because in many respects the items of expenditure have not been thought through and elaborated in detail." What is apparent from consideration of past practice is that at least since the mid-1980s the chief means of limiting expenditures made by departments of State that has been adopted in annual appropriation Acts has been to specify the amount that may be spent rather than further define the purposes or activities for which it may be spent. There is, therefore, nothing in the relevant constitutional framework or in past parliamentary practices which suggests some construction of the Appropriation Act (No 1) 2005-2006 different from the construction required by its text. Summary In view of the complexity of the arguments advanced in this case, it is convenient at this point to summarise the reasoning set out above. The question posed by the plaintiffs is whether expenditure on advertising the Government's reform package falls within the figure of $140,131,000 appearing in that part of Sched 1 to the Appropriation Act (No 1) 2005-2006 which relates to the Department of Employment and Workplace Relations. That figure is in the "Departmental Outputs" column against Outcome 2 – "Higher productivity, higher pay workplaces". The answer is in the affirmative for the following reasons. That figure is an integer in the total amount of $1,447,552,000 set out in Sched 1 in relation to the Department under the heading "Departmental Outputs"88. 87 (1975) 134 CLR 338 at 394. 88 See [117]. Callinan Therefore that total amount of $1,447,552,000 is a "departmental item". It is not an "administered item", because it is not set out opposite an outcome under the heading "Administered Expenses"89. Section 7(2) restricts the application of that departmental item of the departmental it may only be applied "for expenditure" of the Department. But the Act imposes no narrower restriction on the scope of the expenditure90. In this respect s 7(2) is in contrast with the restriction imposed by s 8(2) on an administered item: an administered item may only be applied "for expenditure for the purpose of carrying out activities for the purpose of contributing to achieving" the outcome to which the amount is attributed91. Therefore it does not matter whether any part of the $140,131,000 (or the $1,447,552,000) is spent otherwise than on activities leading to higher productivity or higher pay workplaces (or activities forming part of either of the other two outcomes), so long as it is "departmental expenditure"92. That conclusion is supported by the terms of the note to the definition of The plaintiffs did not contend that expenditure of either $140,131,000 or $1,447,552,000 on advertising the reform package was not "departmental expenditure"94. 89 See [121]. 90 See [123]. 91 See [123]. 92 See [128]. 93 See [129]-[132]. 94 See [135]. Callinan The affirmative conclusion stated above is not affected by s 4(2)95 or by issues relating to the audit of expenditure96. Standing and relief Because the present matter can be decided by dealing with the proper construction of the relevant statutory provisions, it is not necessary to consider whether the plaintiffs have standing to make the claims they do. Nor, given the conclusion that is reached about the construction of the Act, is it necessary to decide what forms of relief could be granted if the plaintiffs' central contention had been made good. On that latter question of relief it is enough to make two points. First, the claim for injunction to restrain the future issuing of drawing rights encounters the very considerable difficulty in Victoria v The Commonwealth and Hayden97 of "carefully and precisely and exhaustively" defining the expenditures, and thus the drawing rights, in respect of which relief was granted. As Jacobs J said98, that may be a "practical impossibility". Secondly, in so far as the plaintiffs would seek declarations that past expenditures, or drawing rights relating to past expenditures, were not authorised by a valid appropriation, there are evident difficulties in making a declaration in a proceeding brought under s 75(v) of the Constitution without granting relief under s 75(v). Moreover, there would also appear to be considerable difficulties in making a declaration which, in its effect, would declare that one or more of the defendants had committed an offence under s 26 of the Financial Management Act by requesting that an amount be debited against an appropriation without a valid drawing right. It is, however, not necessary to decide these questions about relief. The plaintiffs have established no basis for the grant of any of the relief claimed in their amended pleading or foreshadowed in oral argument. 95 See [133]. 96 See [144]-[147]. 97 (1975) 134 CLR 338 at 412. 98 (1975) 134 CLR 338 at 412. Callinan Conclusion For these reasons we joined in the orders, made on 29 September 2005, that the questions in the Special Case be answered in the manner indicated at the start of these reasons, namely: It is unnecessary to answer this question. It is not appropriate to answer this question. The Plaintiffs have not established a basis for any of the relief sought in the Amended Statement of Claim or the alternative relief foreshadowed at the hearing of the Special Case, namely, declarations concerning payments to meet expenses incurred by the Commonwealth under contracts and arrangements for and to certain past advertisements. in relation It is unnecessary to answer this question. The Plaintiffs. Kirby 167 KIRBY J. These proceedings are brought pursuant to s 75(v) of the Constitution. That is the distinctive provision that assures "to all people affected that officers of the Commonwealth obey the law and neither exceed nor neglect any jurisdiction which the law confers on them"99. It ensures that the constitutional assumption of the rule of law100 is rendered a reality in matters of federal concern. The threshold issue in the proceedings is one of statutory construction. It is whether any item in the Appropriation Act (No 1) 2005-2006 (Cth) ("the Appropriation Act") authorised the withdrawal of money from the Treasury of the Commonwealth to pay for certain advertisements promoting proposed future changes to federal laws governing industrial relations. Such changes have not been introduced to, considered, still less enacted by, the Federal Parliament101. The plaintiffs assert (and the defendants deny) that the withdrawal, or proposed withdrawal, of such money is unlawful, as unsustained by the Appropriation Act or by any other law and is therefore forbidden by the Constitution102. Self- evidently, in assessing this assertion, this Court is not, as such, concerned with the wisdom or merits of the expenditure. It is concerned solely with its legality103. The issue of statutory construction presented cannot be resolved by reference only to the terms of the Appropriation Act. Regard must be had to the provisions of the Appropriation Act is expressed104, as well as centuries of constitutional history, including in Australia, concerning appropriation and the practice of parliaments, specifically the Federal Parliament, in giving effect to this law and history. the background of which the Constitution, against 99 Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476 at 514 [104]. 100 Australian Communist Party v The Commonwealth (1951) 83 CLR 1 at 193; Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476 at 492 [31]. 101 Their broad intent was described by the Prime Minister in the House of Representatives: Australia, House of Representatives, Parliamentary Debates (Hansard), 26 May 2005 at 38-43. 102 Constitution, s 83 which requires the withdrawal of money from the Treasury to be "under appropriation made by law". 103 Victoria v The Commonwealth and Hayden ("the AAP Case") (1975) 134 CLR 338 at 351. In cases of this kind, questions of constitutional validity and interpretation are closely related: Brown v West (1990) 169 CLR 195 at 200-201. 104 Especially Constitution, ss 53, 54, 55, 56, 81, 83 and 97. Kirby The proceedings also raise questions about the justiciability of the foregoing issues; the standing of the plaintiffs to obtain relief; the susceptibility of the plaintiffs' complaints to the provision of effective relief; whether any such relief should be refused on discretionary grounds; and who should pay the costs. In Onus v Alcoa of Australia Ltd105, Gibbs J cautioned against the determination of an issue of standing disjoined from a thorough appreciation of the issues of substance proffered for determination. The same caution applies to decisions on any question of justiciability which, in these proceedings (if it arises at all) is closely related to the issue of standing106. Similarly, the amenability of the issues to the formulation of relief and questions as to the provision of such relief can only be decided when the controversy is understood. For these reasons, although logically questions of justiciability and standing arise at the threshold, the arguments of all parties postponed the resolution of those questions until the matters of substance were considered and a view reached as to their disposition. This was a sensible course. It is one that I will follow in these reasons. The plaintiffs have made good their challenge to the lawfulness of the withdrawal of money from the Treasury for the advertisements that they impugn. When the Appropriation Act and the items advanced to justify authorisation by the suggested appropriations are read, understood against the background of the Constitution, constitutional history and parliamentary practice, the propounded appropriations do not support the drawing of such money from the Treasury. The plaintiffs' complaints are justiciable. The second plaintiff, and probably the first, have standing. Appropriate relief can be framed. No discretionary barrier stands in the way of the issue of a constitutional injunction under s 75(v). The plaintiffs are entitled to relief together with their costs. On 29 September 2005, a majority of this Court reached conclusions different to mine. Orders were made rejecting the plaintiffs' proceedings and ordering them to pay costs. I now state my reasons for coming to the opposite conclusion. The facts The parties to the proceedings: Many of the facts necessary to my reasons are set out by others107. The primary facts, and the sequence of events, were not 105 (1981) 149 CLR 27 at 38. 106 AAP Case (1975) 134 CLR 338 at 379. 107 See reasons of McHugh J at [37]-[42]; reasons of Gummow, Hayne, Callinan and Heydon JJ ("the joint reasons") at [105]. Kirby in dispute. However, each side to the contest sought to provide a large number of factual items of limited relevance (or of no relevance at all) to the legal issues. It is necessary to sort out the few precious grains of litigious wheat from a great deal of chaff. The first plaintiff (Mr Greg Combet) is Secretary of the Australian Council of Trade Unions ("ACTU"). This is the peak representative body for trade unions in Australia, many of them organisations of employees registered under federal law108. The defendants did not seek to draw any differentiation between Mr Combet and the ACTU, the objectives of which include the organisation and representation of the Australian workforce through industrial unions. The second plaintiff (Ms Nicola Roxon MP) is a member of the House of Representatives and of the Australian Labor Party ("ALP"). She is described in the special case as the Opposition spokesperson on legal issues or "Shadow Attorney-General". The defendants are the Commonwealth, the Hon Kevin Andrews MP, a Minister of State with responsibilities for administering the Department of Employment and Workplace Relations ("the Department") and Senator the Hon Nicholas Minchin, also a Minister, with responsibilities for administering the Appropriation Acts and the Financial Management and Accountability Act 1997 (Cth) ("the FMA Act"). The advertising campaign: On 26 May 2005, the Prime Minister (the Hon John Howard MP) announced to the House of Representatives the intention of the Government to propose amendments to federal legislation on industrial relations. Amongst the legislative changes foreshadowed were alterations to the role of the Australian Industrial Relations Commission; changes to the law respecting the setting of minimum wages and conditions; amendment of unfair dismissal laws; and pursuit of "the goal of a national industrial relations system" in substitution for the mixture of federal and State regulation now applicable in most parts of Australia109. No discussion paper was issued. Nor was any call made for submissions, before or after the foregoing announcement. At the time of the announcement, and to the date on which these proceedings were 108 Workplace Relations Act 1996 (Cth), Sched 1B, items 18-19. 109 Ministerial Statement on Workplace Relations Reform, Australia, House of Representatives, Parliamentary Debates (Hansard), 26 May 2005 at 38-43. Victoria alone of the States has referred powers with respect to industrial matters to the Federal Parliament: see Workplace Relations Act 1996 (Cth), Pt XV. Kirby decided110, no Bill had been introduced into the Parliament to give effect to the "reform package" described by the Prime Minister. In response to the Prime Minister's announcement, the ACTU initiated a national campaign of opposition to the foreshadowed legislation. This included a "National Week of Action" between 27 June 2005 and 1 July 2005; the holding of large rallies involving some employees who had absented themselves from work in order to attend the meetings; and the initiation of advertisements in the print and electronic media: the latter on television, radio and the internet. By inference, such advertising was funded by the ACTU or by private organisations and persons sympathetic to its causes. The ALP, in and out of the Parliament, supported the ACTU in opposition to the announced intended legislation. Ms Roxon took her part in this campaign. By inference, the political opposition was likewise privately funded. In response, there were many public speeches and statements in defence of the proposals by the Minister, Mr Andrews. Exchanges of that type are the very kind of "free expression" of a political or governmental character implicit in the representative democracy of the Constitution111. But it was at this point that events occurred which the plaintiffs depict as a shift from "free expression" to "publicly funded expression", in support of the Government's proposed laws; but without an appropriation for that purpose granted by the Parliament. the Commonwealth established by From 9 July 2005, advertisements began to appear throughout Australia, in a form exhibited by the plaintiffs in these proceedings, both in the print media and, after 23 July 2005, in radio broadcasts. Such advertisements were not funded by employers' industrial organisations equivalent to the ACTU, nor by private businesses, nor by the political parties whose members (including the named Ministers) have formed the Government of the Commonwealth, nor by individuals supporting the advertisements make it plain that they were (as the newspaper versions declared) "authorised by the Australian Government, Capital Hill, Canberra, ACT"112. the Government and its policies. Instead, 110 The Court answered the application unfavourably to the plaintiffs on 29 September 111 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 560-562 and cases there cited. 112 The text of a sample of such advertisements is set out in the reasons of McHugh J Kirby informative or descriptive. The advertisements appear under the coat of arms of the Commonwealth and insignia of the "Australian Government". They refer to "our plan"; to the commitment that "we" give; and to what "we won't do". They repeat many of the points made in the Prime Minister's statement to the Parliament. The advertisements are not simply They are argumentative. Like those published by the ACTU, they are expressed in rhetorical language. The only difference is the source of the funding. The question in these proceedings is whether, in such circumstances, in advance of the passage (or even the introduction) of the "package" of promised legislation, the Federal Parliament had appropriated funds for such a use by the terms in which it enacted the Appropriation Act or any other law. By the special case, the Commonwealth was said to be considering the broadcast of advertisements on commercial television. By inference, these would be in a similar form and to a like effect, but more expensive. Unless restrained by order of this Court, the Commonwealth proposes to pay for the Government's advertisements using public money drawn from the Treasury. Already, a delegate of Senator Minchin, in his capacity as Minister administering the FMA Act, has issued drawing rights under s 27 of that Act authorising one or more persons in the Department to make payments of public money in respect of the impugned advertisements. Unless restrained, delegates of that Minister could issue still further drawing rights to make payments of public money for further advertisements, ostensibly under the authority of the appropriations made for the departmental item for the Department in the Appropriation Act. The defendants propose that officers of the Department will draw money from the Treasury, in accordance with such drawing rights, to pay for the advertisements. Relying on information contained in a letter from the defendants' solicitors, the plaintiffs contend that the initial cost of the Government's advertising campaign, together with some related expenditure, up to 24 July 2005, was at least $3.84 million. The plaintiffs invited the Court to infer that the total cost of the Government's "campaign" would be well in excess of this amount, given that the advertising is intended to be ongoing; that the cost of most radio advertising had not by 24 July 2005 fallen in; and that television advertising was under consideration. The precise cost, and likely future cost, of the Government's campaign is not ascertainable. But obviously it is most substantial113. 113 The plaintiffs relied on a statement made by the Chairman of the Government's Taskforce on Workplace Relations Reform to the effect that the total expense would be of the order of that spent on the advertising campaign in support of the goods and services tax. According to published reports, this advertising campaign cost $14.9 million: see Lindell, "Parliamentary Appropriations and the Funding of (Footnote continues on next page) Kirby A common question: The issues for determination are to be decided on the facts of the present case. However, the circumstances of the case are by no means unique. In recent years, at every level of government in Australia and in governments formed by members of all major political parties, publicly funded advertising campaigns on contentious and politically charged issues have become more common, whereas they were rare or non-existent in the past. This is not a reference to advertising to seek public input into the design of governmental policy, an indication of interest to join government bodies or an expression of views on the shape of legislation under contemplation. Nor is it a reference to advertising that informs its recipients of new legislative or other entitlements and responsibilities enacted by the Parliament or advertising in neutral terms on matters of general social concern (such as messages on road and boat safety, water conservation or the importance of voting or of jury duty). What is new is the expenditure on advertising on subjects "of major political debate and division in the community"114, whereby public funds have been used to pay for the advertisements. The ultimate question is whether this can be done without the approval of the Parliament to an appropriation, granted with the necessary clarity for that purpose. Expenditures for contested governmental advertising campaigns have emerged in recent years in other countries, presenting legal issues in some ways similar to those arising in this case. In Johanns v Livestock Marketing Association115, the Supreme Court of the United States was divided on the lawfulness of a levy imposed for a promotional campaign concerning beef products. The case was the third in eight years that addressed whether a federal programme financing generic advertising violated the First Amendment to the United States Constitution. The specific issue before the Supreme Court was therefore different from the issues arising in this case. However, in Johanns, Souter J recalled that one of the reasons behind the prohibition on the establishment of a State religion, adopted in the United States Constitution and copied in Australia, was Thomas Jefferson's 1779 observation that "to compel a man to furnish contributions of money for the propagation of the Federal Government's Pre-Election Advertising Constitutional Law and Policy Review 21 at 21 (hereafter "Lindell"). 114 Lindell at 22. 115 73 USLW 4350 (2005). Kirby opinions which he disbelieves, is sinful and tyrannical"116. His Honour explained that this thinking had illuminated earlier decisions of the United States Supreme Court, to the effect that the free expression of political opinions "are at serious risk if the government can compel a particular citizen, or a discrete group of citizens, to pay special subsidies for speech on the side that it favors"117. Johanns was thus concerned with "targeted taxes". But are analogous reasons for strict scrutiny of legislation, said to authorise expenditures for the "propagation of opinions" that many in the community disbelieve, susceptible to equal vigilance by the Federal Parliament in this country and by this Court? If such expenditures are to be lawful, do the language and scheme of the Constitution and the expression of the appropriation statute require the authority to be expressed with clarity? Is this necessary, so that the provisions and assumptions of the Constitution are fulfilled; the legislative process is rendered transparent; and those in Government proposing, and in the Parliament supporting, such expenditures are made accountable to the electors of the Commonwealth, whose money they appropriate and expend for such purposes? The resulting issue: The plaintiffs in these proceedings did not assert that the Federal Parliament could never appropriate, nor the Commonwealth spend, money on advertising campaigns. Nor did they assert that such expenditure would never be a "purpose of the Commonwealth", within s 81 of the Constitution. Instead, they argued that the Parliament had not, by the nominated items in the Appropriation Act, appropriated money for the advertising campaign, illustrated in the advertisements and transcripts evidenced in the case. It is in this way that the threshold issue for resolution became one of statutory construction118. However, it is a question of construction to be resolved against the background of the provisions of the Constitution and the conventions and assumptions to which those provisions give effect, read, in turn, with due regard to centuries of constitutional history, practice and principle. Analysis of the issues in this case must therefore commence with the Appropriation Act and the legislative materials that supplement and explain its provisions. It must then address the provisions of the Constitution and 116 73 USLW 4350 at 5356 (2005) per Souter J citing The Founders' Constitution §37, A Bill for Establishing Religious Freedom, (1987) at 77, codified in 1786 as Va 117 United States v United Foods Inc 533 US 405 at 411 (2001), referred to by Souter J in Johanns 73 USLW 4350 at 5356 (2005). 118 The Queen v Lords Commissioners of the Treasury (1872) LR 7 QB 387 at 396 per Kirby considerations of constitutional history with which, in the absence of a clear indication to the contrary, the Appropriation Act and its provisions are to be taken to have conformed. The legislative provisions and materials The contents of the Appropriation Act: In the world of statutes an Appropriation Act is a rare bird119. However, it is an Act of the Federal Parliament. Indeed, it is expressly envisaged as one of the laws which the Parliament must make120. It must therefore observe the constitutional requirements for the enactment of a law. When made, it is subject to examination by this Court, according to its terms, in a proceeding brought by a party with a requisite interest121. The Bill that became the Appropriation Act was introduced into the House of Representatives as Appropriation Bill (No 1) 2005-2006 (Cth). It was introduced, together with Appropriation Bill (No 2) 2005-2006 (Cth), on 10 May 2005. This was the occasion of the presentation to the Parliament of the Government's Budget. Accompanying the Bills were a number of budget papers. Under the Acts Interpretation Act 1901 (Cth) ("the Interpretation Act"), such papers are available to this Court as material "not forming part of the Act [which] is capable of assisting in the ascertainment of the meaning of the provision"122. Specifically, the Court may have regard to such material for this purpose "to confirm that the meaning of the provision is the ordinary meaning conveyed by the text … taking into account its context in the Act and the purpose or object underlying the Act"123 and as a "relevant document, that was laid before, or furnished to the members of, either House of the Parliament by a Minister before the time when the provision was enacted"124. The parliamentary practice of introducing at least two Appropriation Bills, leading to the enactment, if approved, of an Appropriation Act (No 1), and 119 AAP Case (1975) 134 CLR 338 at 393 per Mason J. 120 Constitution, ss 53, 54, 56 and 83. 121 Brown v West (1990) 169 CLR 195 at 209. See also Saunders, "Parliamentary Appropration", in Saunders et al (eds), Current Constitutional Problems in Australia, (1982) 1 at 35-36. 122 Interpretation Act (Cth), s 15AB(1). 123 Interpretation Act (Cth), s 15AB(1)(a). 124 Interpretation Act (Cth), s 15AB(1)(e). Kirby Appropriation Act (No 2), is the result, in Australia, of constitutional provisions that limit the powers of the Senate, relevantly, to amend "laws appropriating revenue or moneys for the ordinary annual services of the Government"125. Some of the history and practice of the Commonwealth and of the Federal Parliament in this regard is described in Brown v West126. As stated in the long title to the Appropriation Bill, in question in these proceedings, it was "a Bill for an Act to appropriate money out of the Consolidated Revenue Fund for the ordinary annual services of the Government, and for related purposes". The operative provisions of the Bill for the Appropriation Act were found in cl 15127. That clause provided that: "The Consolidated Revenue Fund is appropriated as necessary for the purposes of this Act". Schedule 1 to the Bill provided for "Services for which money is appropriated". The Schedule was divided into the several designated portfolio items of the Executive Government of the Commonwealth. That which is said to be relevant to the appropriation in issue in these proceedings is the entry for the "Employment and Workplace Relations Portfolio". In accordance with a new federal budgetary practice the appropriations in the Schedule are expressed, relevantly, in terms of specified "Outcomes". The appropriations are then further subdivided into "Departmental Outputs" and "Administered Expenses". The relevant items of the Schedule are set out in the reasons of Gleeson CJ128 and elsewhere129. I incorporate the Schedule by reference. The substantive provisions of the Bill contained explanations of the differentiation between "departmental items" and "administered items"130. The differences are further explained in the Portfolio Budget Statements 2005-06: Employment and Workplace Relations Portfolio (the "PBS")131. The PBS is a budget related paper, issued with the relevant Appropriation Bill on its 125 Constitution, s 53. 126 (1990) 169 CLR 195 at 206-208. See also Harris (ed), House of Representatives Practice, 5th ed (2005) at 416-423. 127 Now, the Appropriation Act, s 15. 128 Reasons of Gleeson CJ at [14]. 129 Reasons of McHugh J at [54]; joint reasons at [117]. 130 Respectively cll 7 and 8 of the Bill. Now the Appropriation Act, ss 7 and 8. 131 Budget Related Paper No 1.6 at xii. Kirby introduction into the Parliament. By cl 4 of that Bill such "Portfolio Budget Statements are hereby declared to be relevant documents for the purposes of section 15AB of the [Interpretation Act]"132. By virtue of this declaration, any doubt as to the use that might be made of the PBS in interpreting the Appropriation Act, pursuant to the universal provisions of the Interpretation Act, is laid at rest. The PBS is declared to be available. By reference to the PBS, it is made plain that "departmental outputs" relate to expenses controlled by the agency. On the other hand, "administered items" cover other expenses such as "subsidies, grants and personal benefit payments"133. By the defendants' amended defence in these proceedings, it is asserted that the impugned advertising campaign is to be paid for in reliance upon the departmental item for the Department. Specifically, the defendants relied on "Outcome 2". This refers to the outcome of "Higher productivity, higher pay workplaces". The defendants submitted that the impugned advertising campaign is inherent in, or incidental to, the outcome so described for which, by enacting the Appropriation Bill No 1, the Parliament has appropriated the necessary money, authorising such money to be drawn from the Treasury as the Constitution envisages, so as to pay for the advertisements published in support of the campaign134. The Appropriation Bill contained a number of clauses suggesting a measure of precision in the appropriations that it proposed to the Parliament. Thus, cl 4(2)135 provided: "If the [PBS] indicate that activities of a particular kind were intended to be treated as activities in respect of a particular outcome, then expenditure for the purpose of carrying out those activities is taken to be expenditure for the purpose of contributing to achieving the outcome." This provision demonstrates clearly enough the central importance of the PBS in elaborating, with the detail necessary to the activities of modern government, the general expressions of outcomes stated in the proposed law itself. 132 Now Appropriation Act, s 4. 133 PBS at xii. 134 Constitution, s 83. 135 Now Appropriation Act, s 4(2) Kirby Likewise, imperative136: the command of cl 7 of the Appropriation Bill was "(1) For a departmental item for an entity, the Finance Minister may issue out of the Consolidated Revenue Fund amounts that do not exceed, in total, the amount specified in the item. (2) An amount issued out of the Consolidated Revenue Fund for a departmental item for an entity may only be applied for the departmental expenditure of the entity. an Act provides that an entity must be paid amounts that are appropriated by the Parliament for the purposes of the entity; and Schedule 1 contains a departmental item for that entity; then the Finance Minister, under subsection (1), must issue out of the Consolidated Revenue Fund the full amount specified in the item. The instruction of specificity was carried forward in cl 8 of the Bill, notably cl 8(2)137: "An amount issued out of the Consolidated Revenue Fund for an administered item for an outcome of an entity may only be applied for expenditure for the purpose of carrying out activities for the purpose of contributing to achieving that outcome." Within the "departmental items" some measure of flexibility, also appropriate to the needs of modern government, was indicated in the definition of that expression in cl 3 of the Bill138. The phrase "departmental item" is there defined to mean "the total amount set out in Schedule 1 in relation to an entity under the heading 'Departmental Outputs'". A note is added which, although not part of the Bill, was designed to assist in understanding its purpose. The note reads: 136 Now Appropriation Act, s 7. 137 Now Appropriation Act, s 8(2) (emphasis added). 138 Now Appropriation Act, s 3. Kirby "The amounts set out opposite outcomes, under the heading 'Departmental Outputs', are 'notional'. They are not part of the item, and do not in any way restrict the scope of the expenditure authorised by the item." This indicates an apparent purpose to permit the transfer of sums for "departmental outputs" as between the several identified outcomes. However, contrary to the approach taken by Gummow, Hayne, Callinan and Heydon JJ ("the joint reasons")139, it does not expand the nominated outcomes nor indicate approval for disregarding such outcomes in a way that would render parliamentary authority for the appropriation nugatory or meaningless. The contents of the PBS: The general purpose of the PBS, relevant to the items concerning the Department, is stated in a covering letter, contained within it, addressed by the Minister, the second defendant, to the President of the Senate and the Speaker of the House of Representatives. The letter states: "I present these statements by virtue of my Ministerial responsibility for accountability to the Parliament and, through it, the public." The opening page of the PBS also contains a "User Guide", identifying the "Purpose of the Portfolio Budget Statements"140. The following appears in that guide: "The purpose of the [PBS] is to inform Senators and Members of Parliament of the proposed allocation of resources to government outcomes by agencies within the portfolio. … A key role of the [PBS] is to facilitate the understanding of proposed annual appropriations in Appropriation Bills No 1 and No 2 … The [PBS] provide sufficient information, explanation and justification to enable Parliament to understand the purpose of each outcome proposed in the Bills." In describing the "agency outcomes" the PBS states that "[t]his section explains how the resources identified in Section 2 will be used to deliver outputs and administered items to contribute to the three outcomes for the Department of Employment and Workplace Relations"141. 139 See below these reasons at [287]-[288]. 140 PBS at ix. 141 PBS at 32. Kirby In supporting their arguments the defendants pointed with the greatest conviction to "Outcome 2". The parts of the PBS relevant to this outcome are extracted by McHugh J142. However, there is no item in Outcome 2, or the key priorities for 2005-2006, that identifies, directly or indirectly, the implementation of a major and costly advertising campaign designed to persuade its recipients of the merits of proposed future legislation. Neither by express language nor in general terms does such expenditure get the slightest mention. This may be unsurprising because, at the time the Appropriation Bill No 1 was presented to the Parliament, the details of such anticipated legislation were unknown, still less enacted. The advertising campaign had not yet commenced. In a table (Table 3.1.2) showing the total resources for Outcome 2, expressed in thousands of dollars, two items are nominated which might have a remote connection with the advertising campaign. These are Output 2.1.1 "Workplace relations policy advice" ($19,085) and Output 2.1.2 "Workplace relations legislation development" ($5,851). The plaintiffs accepted that these appropriations were capable of extending to the development by the Department of the Government's anticipated "package" of legislation. But could these items amount to appropriations for the expensive advertising campaign? Neither by express language nor by any relevant general words, was such a "campaign" specified. In Australia, to this time, the provision of policy advice and the development of legislation by a Department of State has not normally involved an advertising campaign directed at the public in advance of the enactment, or even the introduction, of such legislation. Occasionally, the public might be invited to make submissions on identified questions of public policy or on the contents of proposed legislation. No such invitations appeared in the advertisements complained of by the plaintiffs. The provision of policy and the development of legislation are governmental activities different in kind from publicly funded advertising campaigns for the purpose of public persuasion and to respond to a privately funded campaign by political opponents. A contextual consideration, appearing in the PBS, lends support to this conclusion suggested by the language of the Appropriation Act read with the PBS. One of the Department's priorities for "Outcome 2" is identified as the promotion of nominated initiatives addressed to an ageing workforce143. Similarly, under the PBS item for "Outcome 1", express provision is made for a 142 PBS at 46-47: see reasons of McHugh J at [69]. 143 PBS at 46. Kirby "communication strategy" in relation to a "Welfare to Work" programme144. An allocation for that strategy was itemised in the PBS145. It was spelt out in more detail in Budget Paper No 2146. That Budget Paper is explicit147: "The Government will provide $29.0 million over four years to implement a communication strategy focusing on increasing workforce participation. The strategy will target the community as a whole and various groups, including people with disabilities, parents, mature age people and the long-term unemployed." Similar examples of express identification of "communication strategies" may be found in the budget papers in relation to the proposed activities of other portfolios of the Government. One may search the budget papers high and low, in all of their detail, and not find any reference, with direct or indirect particularity, in relation to the advertising campaign or "communication strategy" impugned in these proceedings. Many items referring to appropriations concerning much smaller amounts, with lesser significance and controversy, are spelt out with due detail so as to fulfil the asserted purpose of the PBS as declared by the Minister and explained in the "User Guide". But nothing is expressed that would have given the slighest clue to the Senators and Members of Parliament considering the Appropriation Bill No 1, read with the assistance of the budget papers including the PBS, that they were approving an appropriation for the purpose of a large-scale public advertising campaign in advance of the introduction of the legislation to which it related. Two contextual considerations: Because these reasons may be read years from now when current circumstances are forgotten, it is appropriate to note two further contextual considerations that are relevant. First, there has been a considerable growth in the past fifteen years of governmental expenditures on public advertising. In so far as such expenditures, by governments of differing political persuasions, have concerned contentious 144 PBS at 36. 145 PBS at 22 (second last entry). 146 Budget Paper No 2 at 133. 147 Budget Paper No 2 at 141 (emphasis added). Kirby subjects of major political debate and differences in the community, they have been controversial. Their legality and propriety have been questioned148. Secondly, at the time that the Appropriation Bill No 1 was introduced into the Parliament and considered by the Senate, and at the time that the Bill passed all stages in the Parliament, so as to become the Appropriation Act (No 1) 2005- 2006 (Cth) on 29 June 2005, the political parties whose members had formed, in coalition, the Executive Government of the Commonwealth, did not, in their own right, enjoy a majority of votes in the Senate. Any powers which the Senate may have had to request amendments to the Bill for that Act, for the deletion of an item considered outside the proper subject matter of Appropriation Act No 1, were not enlivened by the silence of the Bill on an item of large-scale public advertising, potentially of much industrial significance and political sensitivity. Since the first Federal Parliament in 1901, the Senate has repeatedly returned Bills, including Bills relating to appropriations, requesting the House of Representatives to amend them or to delete or alter items to which the Senate has objected149. The first occasion on which this was done was on 14 June 1901 when the Consolidated Revenue (Supply) Bill 1901-1902 (No 1) (Cth) was returned by the Senate to the House of Representatives with the request that the House amend the Bill to show the items of expenditure comprised in the sums which the Bill purported to grant. In consequence of the Senate's request, the original Bill was not returned to the Senate by the House. A new and different Bill was forwarded. As requested by the Senate it showed the specified items150. The sufficient identification of proposed expenditures (especially those likely to be politically sensitive and controversial) is not relevant only to the achievement of parliamentary and public scrutiny, as stated in the PBS. It is also relevant to enlivening the residual powers of the Senate, under the Constitution, in respect of Appropriation Bills other than those identified which the Senate may not amend151. The operation of the FMA Act: It is uncontested that the third defendant has issued drawing rights (and may issue further such rights) under s 27 of the FMA Act, authorising officers of the Department to make payments of public money, purportedly under the authority of the appropriation made for the 148 The Auditor-General of the Commonwealth was asked to investigate the subject: see Lindell at 22. 149 Odgers' Australian Senate Practice, 11th ed (2004), Appendix 6. 150 The story is told in Harrison Moore, The Constitution of the Commonwealth of Australia, 2nd ed (1910) at 145-147. 151 Constitution, s 53. Kirby nominated departmental item in the Appropriation Act. Exhibited in the proceedings was an instrument signed by the Secretary of the Department, addressed to designated persons performing specified duties, affording them drawing rights "that authorise the payment of public money for the purpose specified in column 2 of Schedule 1" of the instrument. That purpose, as stated in that column, was "to meet expenses incurred by the Commonwealth under contracts and arrangements for or in relation to advertising regarding workplace relations reform". The instrument specifies the "particular appropriation", upon which it relies, as being "that provided by Appropriation Act (No 1) 2005-2006 in respect of the departmental item for the Department of Employment and Workplace Relations". The purpose of the regime set in place by s 27 of the FMA Act, in respect of the payment of money out of the Consolidated Revenue Fund, is to ensure compliance with the Constitution, with the law and practice governing appropriations and with the provisions made by, and under, the FMA Act152. The object is to prevent and counteract misappropriation by unauthorised, fraudulent and other means. The FMA Act provides for a number of offences that may be committed by persons who fail to act in this regard in accordance with law153. Such criminal sanctions are, however, and are expected to be, rarely invoked. Other sanctions include parliamentary scrutiny, both in the Houses of Parliament and in committees and examination of the accounts, normally after the expenditure, by the Auditor-General154. Obviously, the availability of these and other assurances for compliance with the Commonwealth155, does not oust the jurisdiction and powers of this Court where compliance with a nominated appropriation is called into question156. law of expenditures of the 152 See Financial Management and Accountability Regulations 1997 (Cth), made under the FMA Act. 153 See eg FMA Act, ss 7, 13, 14. 154 Under the Financial Management and Accountability Act 1997 (Cth), s 57(2)(a). See also Auditor-General Act 1997 (Cth), ss 11, 15, 23, 25; Campbell, "Parliamentary Appropriations", (1971) 4 Adelaide Law Review 145 at 164-168. 155 In accordance with the Constitution, s 83. 156 As Brown v West (1990) 169 CLR 195 at 212 demonstrates; cf Northern Suburbs General Cemetery Reserve Trust v The Commonwealth (1993) 176 CLR 555 at Kirby Additional Appropriation Acts: Where an amount, provided Appropriation Acts is insufficient to meet commitments falling due in a financial year, additional or supplementary appropriations may be sought from the Parliament in further Appropriation Bills157. This is regularly done in the practice of the Federal Parliament. Additionally, further Appropriation Bills may be proposed so as to reallocate funds previously appropriated for other purposes158. Furthermore, occasional additional Appropriation Bills are introduced for special purposes. This was done, for example, to appropriate funds to meet urgent requirements arising as a consequence of Australian involvement in the Gulf War in 1990; for special funds for book industry assistance; a welfare programme and for expenditure on environmental matters in 1999; for expenditure related to peace-keeping in East Timor159; and for the Tsunami disaster in the Indian Ocean States in 2004160. Such Bills are preceded by the announcement of a Governor-General's message recommending appropriation161. According to the practice of the House of Representatives, such Bills may be introduced without notice162. The facility for Supplementary Bills to provide for appropriations, that were not made at Budget time in Appropriation Acts (No 1) and (No 2), indicates that the Executive Government, faced with new or unexpected obligations not provided for in appropriations already approved by the Parliament, is not without remedy. Both on large and not so large items, it may seek supplementary appropriations. The impediments are those of politics and convenience, not of law. 157 Harris (ed), House of Representatives Practice, 5th ed (2005) at 421. 158 Appropriation Bills (Nos 3 and 4) 1992-1993 (Cth) were introduced with this explanation: see Harris (ed), House of Representatives Practice, 5th ed (2005) at 421. As to unforeseen expenditure and the practices adopted to cope with unexpected developments, see Campbell, "Parliamentary Appropriations", (1971) 4 Adelaide Law Review 145 at 149-153. 159 Appropriation (East Timor) Act 1999-2000 (Cth). 160 Appropriation (Tsunami Financial Assistance) Act 2004-2005 (Cth); Appropriation (Tsunami Financial Assistance and Australia-Indonesia Partnership) Act 2004- 2005 (Cth). 161 Australian Parliament, House of Representatives, Standing Orders, 180(b). 162 Australian Parliament, House of Representatives, Standing Orders, 178: see Harris (ed), House of Representatives Practice, 5th ed (2005) at 421. Kirby The constitutional provisions and history Constitutional provisions: A number of provisions of the Constitution163 must be noticed to derive the meaning to be assigned to the Appropriation Act, read with the relevant budget papers, including the PBS in relation to the Department. By s 53 of the Constitution it is provided: "Proposed laws appropriating revenue or moneys, or imposing taxation, shall not originate in the Senate. … The Senate may not amend proposed laws imposing taxation, or proposed laws appropriating revenue or moneys for the ordinary annual services of the Government. The Senate may not amend any proposed law so as to increase any proposed charge or burden on the people. The Senate may at any stage return to the House of Representatives any proposed law which the Senate may not amend, requesting, by message, the omission or amendment of any items or provisions therein. And the House of Representatives may, if it thinks fit, make any of such omissions or amendments, with or without modifications. Except as provided in this section, the Senate shall have equal power with the House of Representatives in respect of all proposed laws." By s 54 of the Constitution, provision is made for the contents of Appropriation Bills: "The proposed law which appropriates revenue or moneys for the ordinary annual services of the Government shall deal only with such appropriation." By s 56, the Constitution provides, relevantly, that a proposed law for the appropriation of revenue or moneys "shall not be passed unless the purpose of the appropriation has in the same session been recommended by message of the 163 Under the United States Constitution, Art 1, §9, cl 7: "No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law". This has been held to restrict the disbursing authority of the Executive so that no money is paid out of the Treasury unless it has been appropriated by an Act of Congress: see Cincinnati Soap Co v United States 301 US 308 at 321 (1937). Kirby Governor-General to the House in which the proposal originated". In respect of Appropriation Bill (No 1) 2005-2006 (Cth), by Message No 59 of 6 May 2005, the Administrator of the Commonwealth, Mr John Landy, deputising for the Governor-General, recommended to the House of Representatives, in accordance with s 56 of the Constitution, "that an appropriation be made for the purposes of a Bill for an Act to appropriate money out of the Consolidated Revenue Fund for the ordinary annual services of the Government, and for related purposes". This was the Bill that, when enacted, became the Appropriation Act in question in these proceedings. Three further constitutional provisions need to be noticed. By s 81, all revenues or moneys raised or received by the Executive Government of the Commonwealth "shall form one Consolidated Revenue Fund, to be appropriated for the purposes of the Commonwealth in the manner and subject to the charges and liabilities imposed by this Constitution". Once again, reference is made to "purposes", suggesting a constitutional requirement for sufficient identification, in appropriations, of the "purposes" concerned, so as to conform with the presupposition of s 81. The meaning of this provision was the subject of differences of opinion in Victoria v The Commonwealth and Hayden ("the AAP Case")164. In the present proceedings, the plaintiffs made no complaint that any expenditure would exceed the "purposes of the Commonwealth". However, they insisted on the need to identify such "purposes" in appropriations with sufficient clarity to ensure conformity with s 81. Critical to the plaintiffs' case was s 83 of the Constitution. That section provides: "No money shall be drawn from the Treasury of the Commonwealth except under appropriation made by law." The reference to "by law" makes it plain that, in Australia, an Appropriation Act must be passed by both Houses of the Parliament so as to become "law"165. The Executive has no inherent power to appropriate money in the Treasury nor to draw money from the Treasury except under an appropriation granted by the Parliament. In this way, the ultimate control of public money resides in the Parliament, although the initiative for proposed appropriations belongs to the Executive Government, in accordance with s 56 of the Constitution166. 164 (1975) 134 CLR 338. 165 Attorney-General (Vict) v The Commonwealth (1945) 71 CLR 237 at 250. See also Constitution, s 53. 166 Lane, Lane's Commentary on the Australian Constitution, 2nd ed (1997) at 644. Kirby This allocation of functions and responsibilities is not atypical of the arrangements existing in many countries that derive their constitutional traditions from England. However, the provisions concerning the powers of the Senate in relation to Money Bills (ss 53 and 54) and for the resolution of disagreements between the Houses of the Federal Parliament (s 57) are peculiar to Australia. In these proceedings, no consideration can be given to the meaning of the Appropriation Act in question, the effect of the appropriations there made and the identification of the "purposes" of such appropriations, without close attention to the foregoing constitutional provisions and to the place that they allocate to the Senate167. Constitutional history and purpose: The history that preceded the adoption of these Australian constitutional provisions reinforces the inference to be derived that a minimum standard of disclosure to the Parliament (including the Senate) is necessary to fulfil the postulates of the form of parliamentary government established by the Constitution. In the AAP Case, Stephen J described the long struggle of the English House of Commons with the Plantagenet, Tudor and Stuart Kings for control by Parliament over the financial affairs of the kingdom168. The principle of appropriation of supply to the King for specific purposes first emerged in England in the fourteenth century; but was later denied. It re-emerged in 1665. However, the control over the raising of funds and of their expenditure was only finally achieved following the English Revolution of 1688169. The House of Lords was then left only with the power to withhold consent to Money Bills, not to propose or amend them. That was how things stood when the Australian Constitution was adopted and the respective powers of the Houses of the Federal Parliament were assigned170. 167 There are exceptions to the need for specific appropriation recognised by the Constitution but these do not need to be considered here: Attorney-General (Vict) v The Commonwealth (1945) 71 CLR 237 at 251; AAP Case (1975) 134 CLR 338 at 168 AAP Case (1975) 134 CLR 338 at 385-386. 169 Maitland, The Constitutional History of England, (1955) at 182-184, 309-310. 170 By the Parliament Act 1911 (UK) a Money Bill, not passed by the House of Lords, may be presented for the Royal Assent and become an Act without enactment by the Lords: see AAP Case (1975) 134 CLR 338 at 386 per Stephen J. No analogous amendment to the Australian Constitution has been adopted. See, however, Constitution, s 53 and Brown v West (1990) 169 CLR 195 at 201. Kirby Whatever differences may have existed within this Court in the AAP Case (mostly concerned with the question whether the "purpose" specified in the appropriation was a "purpose of the Commonwealth" within s 56 of the Constitution171) by the time the Court delivered its unanimous decision in Brown v West (where the "purpose of the Commonwealth" was uncontested), certain features of the Australian law governing federal Appropriation Acts were clearly established. The authority of Brown v West was not challenged by any party to these proceedings. It is a recent and unanimous decision of this Court. In my view it is correct. It applies to the issues in question here. It draws, as the Court acknowledged in that case, on the constitutional history of England that helps to explain the provisions governing appropriations contained in the Australian Constitution. In Brown v West172 this Court approved the remarks of Mason J in the AAP Case173 when his Honour said: "Section 83 in providing that 'No money should be drawn from the Treasury of the Commonwealth except under appropriation made by law', gives expression to the established principle of English constitutional law enunciated by Viscount Haldane in Auckland Harbour Board v The King174: 'no money can be taken out of the consolidated Fund into which the revenues of the State have been paid, excepting under a distinct authorization from Parliament itself'. An Appropriation Act has a twofold purpose. It has a negative as well as a positive effect. Not only does it authorize the Crown to withdraw moneys from the Treasury, it 'restrict(s) the expenditure to the particular purpose', as Isaacs and Rich JJ observed in The Commonwealth v Colonial Ammunition Co Ltd175." This Court also upheld a principle that had been stated by Latham CJ in Attorney-General (Vict) v The Commonwealth176: 171 See Brown v West (1990) 169 CLR 195 at 209. 172 (1990) 169 CLR 195 at 208. 173 (1975) 134 CLR 338 at 392. 174 [1924] AC 318 at 326. 175 (1924) 34 CLR 198 at 224. 176 (1945) 71 CLR 237 at 253. The appropriation is the authority to the Treasurer to make "the specified disbursements": see The State of New South Wales v The Commonwealth (1908) 7 CLR 179 at 190 per Griffith CJ; see also at 200 per Isaacs J; cf Brown v West (1990) 169 CLR 195 at 205. Kirby "[T]here cannot be appropriations in blank, appropriations for no designated purpose, merely authorizing expenditure with no reference to purpose." And the Court gave effect to what Isaacs J had said still earlier in The State of New South Wales v The Commonwealth ("the Surplus Revenue Case")177: "'Appropriation of money to a Commonwealth purpose' means legally segregating it from the general mass of the Consolidated Fund and dedicating it to the execution of some purpose which either the Constitution has itself declared, or Parliament has lawfully determined, shall be carried out." To make these points doubly sure, this Court in Brown v West178 added emphasis to the principle stated by Viscount Haldane in Auckland Harbour Board v The King179 by expressly endorsing a passage in his Lordship's reasons which followed that already quoted: "The days are long gone by in which the Crown, or its servants, apart from Parliament, could give such an authorization or ratify an improper payment." Their Honours might also have added, as I do now, a further sentence in the Auckland Harbour Board Case that came immediately after those cited180: "Any payment out of the consolidated fund made without Parliamentary authority is simply illegal and ultra vires, and may be recovered by the Government if it can, as here, be traced." If these strong words of the Privy Council could be applied in 1924 to describe the constitutional arrangements of the United Kingdom and of New Zealand, how much more applicable are they to the requirements of the Australian Constitution, expressed in a written instrument stated in imperative terms, designed to make certain, and to immure from easy change, similar British constitutional precepts? The criterion, thus endorsed by this Court, is one of 177 (1908) 7 CLR 179 at 200. The emphasis was added by this Court in Brown v West (1990) 169 CLR 195 at 208. 178 (1990) 169 CLR 195 at 209. 179 [1924] AC 318 at 326-327. 180 [1924] AC 318 at 327. Kirby "distinct authorization from Parliament itself". To the extent that the Executive Government seeks to justify expenditures, except where there is "a distinct authorization", it challenges centuries of constitutional history. It departs from the provisions of the Australian Constitution designed to give that history effect. It detracts from the basic purpose of such provisions, being to assure to the people in Parliament the final say about the expenditure of public moneys. It weakens accountability of the Government to the Parliament in all such matters181. To conclude otherwise would be to depart from the principles endorsed in Brown v West. This Court should not retreat from the clear rule expressed in that case. Behind it stands a principle of comparative strictness required by the text of our Constitution, by centuries of history and by policies of good governance to which that text gives effect182. Ordinary annual services of government: There is an additional contextual consideration that may be traced to the Constitution which reinforces an inference that, in this case, the failure to identify a distinct appropriation for the purpose of the impugned advertising campaign meant that no "particular purpose" was established to authorise such expenditure under expressions in the Appropriation Act cast in general and non-particular terms. This argument, which was elaborated by the State of Western Australia, intervening in support of the plaintiffs, latched onto the words "the ordinary annual services of the Government". That phrase appears in the second paragraph of s 53 of the Constitution. The words likewise have a long history in the practice of the Parliament of the United Kingdom in granting authorisation for appropriations of money for the recurring services of the Government. The appropriation for the departmental item in question in this case is contained in an Act appropriating money out of the Consolidated Revenue Fund for the ordinary annual services of the Government183. I accept, as the State of Western Australia submitted, that it may be assumed that the Parliament intended that the appropriations provided for in the Act be appropriations for the "ordinary annual services of the Government", as that phrase is understood in the Constitution. In construing the Act, it is therefore relevant to consider whether expenditure on advertising for the proposed reforms falls within the ambit of that concept. In doing so, it is helpful to consider the meaning of the phrase "ordinary annual services of the Government" as it has been understood in its historical and constitutional context. 181 As envisaged by the Constitution, s 64. See also s 61. 182 cf State v Moore 69 NW 373 at 376 (1896) (SC Nebraska); Crane v Frohmiller 45 P 2d 955 at 959 (1935) (SC Arizona). 183 The long title to the Appropriation Act. Kirby By the nineteenth century, in England, the estimates for the ordinary annual expenditure of the government comprised three main divisions: for the Army, the Navy and the Civil Services184. The estimates for the last category included public works and buildings, the salaries and expenses of civil departments, law and justice, education, science and the arts, foreign and colonial labour services, non-effective and charitable services, old-age pensions, exchange costs and insurance185. The general position was that the Crown in the United Kingdom was not restrained in presenting an estimate of expenses within these divisions186. Different procedures were followed in relation to expenditures falling outside the estimates for such ordinary annual expenditure of the Government. For other expenditures, explicit approval was sought, according to the nature of the demand. It became accepted that expenditures for new purposes, not covered by the existing powers and functions of a governmental department or authority187, or expenditures for novel purposes188, or where the expenditure was required to be authorised for longer than a year or for an indefinite period189 or was authorised on conditions190 all required separate appropriation approval by Parliament. They could not be wrapped up in the recurrent estimates for the ordinary, annual expenditure of the Government when approaching Parliament for approval of appropriations. Unsurprisingly, this emerging convention of the British Parliament was also reflected in the practice followed from the early days in the Australian colonies. In 1857, in South Australia, disputes arose as to the respective powers of each House of the legislature in relation to Money Bills. Ultimately, the 184 Durell, The Principles and Practice of the System of Control Over Parliamentary Grants, (1917) at 15. 185 Durell, The Principles and Practice of the System of Control Over Parliamentary Grants, (1917) at 46. 186 Gordon (ed), Erskine May's Treatise on the Law, Privileges, Proceedings and Usage of Parliament, 20th ed (1983) at 791 ("hereafter Erskine May"). 187 Erskine May at 791. See also Gordon (ed), Erskine May's Treatise on the Law, Privileges, Proceedings and Usage of Parliament, 23rd ed (2004) at 882. 188 Erskine May at 760. 189 Erskine May at 793. 190 Erskine May at 791. Kirby Legislative Council resolved to waive the claim that it could deal with the details of the ordinary annual expenses of the Government, submitted in an Appropriation Bill in the usual form191. The resulting convention in South Australia encouraged the adoption of provisions in what are now the constitutions of the States of Australia, whereby the "ordinary annual services of the Government" are sometimes expressly and separately provided for192. It was against the background of this Imperial and colonial parliamentary practice that the language of s 53 of the federal Constitution was adopted, segregating specific categories of proposed laws that might not be amended by the Senate. Relevantly, these were proposed laws appropriating revenue or moneys for the ordinary annual services of the Government. During the Convention debates, leading to the adoption of the foregoing provisions of the Constitution, the phrase in question was not considered at any length. However, suggestions were made that the words were directed to a Bill which "simply appropriates revenue and carries out a settled policy involving no new departure"193. Or to a Bill which "simply covers the expenditure based upon a policy previously agreed to"194. It was also observed that the "ordinary expenditure of the year covers the expenditure of the various departments of the Commonwealth"195. The view was expressed in the Convention debates that a Bill for such ordinary annual services would not appropriate "extraordinary supplies"196. "Ordinary" services were distinguished "from special grants and from loan services"197. Shortly after Federation, Attorney-General Deakin 191 Harrison Moore, The Constitution of the Commonwealth of Australia, 2nd ed 192 See eg Constitution Act 1902 (NSW) s 5A; Constitution Act 1975 (Vic), s 65; Constitution Acts Amendment Act 1899 (WA), s 46; Constitution Act 1934 (Tas), s 36; cf Twomey, The Constitution of New South Wales, (2004) at 568. 193 Official Report of the National Australasian Convention Debates, (Sydney), 3 April 1891 at 720 (Mr McMillan). 194 Official Report of the National Australasian Convention Debates (Sydney), 6 April 1891at 756 (Mr McMillan). 195 Official Record of the Debates of the Australasian Federal Convention, (Melbourne), 8 March 1898 at 2077 (Mr Deakin). See also at 2076 (Mr Barton). 196 Official Report of the National Australasian Convention Debates, (Adelaide), 14 April 1897 at 605 (Mr Glynn). 197 Official Record of the Debates of the Australasian Federal Convention Debates, (Melbourne), 8 March 1898 at 2076 (Mr McMillan). Kirby expressed the opinion that the phrase "ordinary annual services of the Government" encompassed "[a]ppropriations for new buildings or additions when these are required in the ordinary course of departmental business"198. Obviously, the expression "ordinary annual services of the Government" should be given a broad and not a narrow meaning199. By the same token, the phrase is not completely open-ended. Nor, in a sparse constitutional text, can it be suggested that the words "ordinary" and "annual" are superfluous or devoid of meaning. Given the consequence of excluding the powers of amendment by the Senate (which is otherwise to have a power of amendment in respect of all proposed laws equal to that of the House of Representatives200) and given the practice of isolating appropriations for such services of the Government in the separate annual Appropriations Bill No 1, the adjectives "ordinary" and "annual" must be taken to be descriptive of limitations to be observed in the content of Appropriation Bills. Only such services enjoy the designated immunity from Senate amendment. The 1965 Compact and new policies: In the Federal Parliament, the potential for serious disagreement between the two Houses and the Executive Government on what constitutes "ordinary annual services of the Government" was substantially resolved by an agreement between the interested parties, reached in 1965, as to what those words should be taken to mean. This agreement is known as the "Compact of 1965"201. The determination by the Houses of Parliament (and the Executive Government) of their respective understandings of the constitutional words is not, of course, conclusive. Ultimately, it is for this Court to give meaning to the words of the Constitution, where that step is required. However, especially as the phrase concerns the internal procedures of the Parliament, in respect of which deference is ordinarily accorded by courts to parliamentary understandings202, it 198 Brazil and Mitchell (eds), Opinions of Attorneys-General of the Commonwealth of Australia, (1981) vol 1 at 28 (opinion dated 26 September 1901). 199 cf AAP Case (1975) 134 CLR 338 at 413 per Jacobs J, 418, 422 per Murphy J. 200 Constitution, s 53 (par 5). 201 Odgers' Australian Senate Practice, 11th ed (2004) at 282. See also Odgers' Australian Senate Practice, 6th ed (1991) at 581-582. 202 cf AAP Case (1975) 134 CLR 338 at 394; Egan v Willis (1998) 195 CLR 424 at 466-467 [79] per McHugh J, 487-494 [124]-[134] of my own reasons; Sue v Hill (1999) 199 CLR 462 at 557 [247] per McHugh J, 567-568 [277], 568-569 [279] of my own reasons. Kirby is proper for this Court to note the Compact of 1965. This Court has earlier endorsed reliance on the Compact and consequent parliamentary practice to assist in the interpretation of Appropriation Acts203. It may safely be assumed that the Appropriation Bill No 1, in issue in these proceedings, was presented to the Parliament and considered by each House, on the footing that it was intended to comply with that Compact. The defendants expended some effort in argument to suggest that the Compact of 1965 had been amended in a relevant way by later decisions of the Executive Government, agreed to by the Senate. However, this does not appear to be the way such developments were understood. Nor is it the way those developments are interpreted in contemporary statements of the Compact of 1965, at least so far as it affects the point of significance for the present proceedings204. As formalised by a resolution of the Senate in 1977, following a report by the Senate Standing Committee on Constitutional and Legal Affairs, chaired by Senator A N Missen205, the Compact of 1965 reads206: "That the Senate resolves: To reaffirm its constitutional right to amend proposed laws appropriating revenue or moneys for expenditure on all matters not involving the ordinary annual services of the Government. That appropriations for expenditure on: 203 Brown v West (1990) 169 CLR 195 at 206-208, 211-212. 204 Thus in 1999, when the Executive Government adopted accrual accounting, the Finance Minister noted that the allocation of items between Appropriation Bills Numbers 1 and 2 "would be largely unchanged" and that Bill 2 would be appropriation, relevantly, for "new policy for new outcomes not previously approved by Parliament or authorised by special legislation". The Senate Committee approved the proposed changes as being "in accordance with the spirit of both the constitutional provisions and the Compact": see Australia, Senate Standing Committee on Appropriations and Staffing, 13th Report of the Senate Standing Committee on Appropriation and Staffing, (1999) at 3. This Report was adopted by the Senate. 205 Australia, Senate Standing Committee on Constitutional and Legal Affairs, Report on the Ordinary Annual Services of the Government, (1976) (Parliamentary Paper 206 The resolution appears in Australia, Senate, Journal of the Senate, (1977), vol 82 at 572, No 20 (17 February 1977) (emphasis added). See also Australia, House of Representatives, Parliamentary Debates (Hansard), 13 May 1965 at 1485. Kirby the construction of public works and buildings; the acquisition of sites and buildings; items of plant and equipment which are clearly definable as capital expenditure; grants to the States under section 96 of the Constitution; and new policies not previously authorised by legislation, special are not appropriations for the ordinary annual services of the Government and that proposed laws for the appropriation of revenue or moneys or expenditure on the said matters shall be presented to the Senate in a separate Appropriation Bill subject to amendment by the Senate." So far as "new policies" are concerned, as expressed in par (2)(e) of this resolution, it appears clear that the Compact of 1965 is still assumed to be in full operation. So much was accepted by this Court in Brown v West207. Addressing the suggestion that Supply Bill (No 1) of 1989-1990 had contained an appropriation for the purpose of supplementing the postal allowance for Senators and Members of Parliament, in issue in that case, this Court observed that such an argument would involve208: "find[ing] in it an appropriation for the funding of a new policy which, by parliamentary practice, would be found only in a bill for special legislation or, at the least, in Appropriation Bill (No 2). It can therefore be taken that, ... as a matter of parliamentary practice, the Supply Act (No 1) 1989-1990 was not intended to include an appropriation for new policies". By analogous reasoning, the plaintiffs, and Western Australia, submitted that, consistently with the Compact of 1965, and parliamentary practice based 207 (1990) 169 CLR 195 at 211. The Court referred to the Compact of 1965 at 207. The Appropriation Act was read in the light of the existing federal law and parliamentary practice. It was not taken to have effected an implied repeal of the earlier federal legislation. By parity of reasoning, the existing federal law on industrial relations is primarily the Workplace Relations Act 1996 (Cth), enacted by the Parliament. Obviously, no announced proposed amendment of that Act could be taken to have repealed the provisions of that Act which remains the law of the Commonwealth: cf Lindell at 25. 208 (1990) 169 CLR 195 at 211. Kirby upon it, the initiation of a major advertising campaign, involving widespread promotion of as yet unknown and unenacted legislation, would amount to appropriation for expenditure on "new policies not previously authorised by special legislation". It would not find its place in Appropriation Bill (No 1), immune from Senate amendment. In accordance with the Compact, it would have to run the gauntlet of Senate scrutiny and the possibility of Senate amendment. It would have to do so, as stated in Brown v West, as an item in a "bill for special legislation or, at the least, in Appropriation Bill (No 2)". Quite apart from the question whether such an advertising campaign would be so classified there is, in any case, much force in the submission of Western Australia that the proposed changes to federal industrial relations law, to which the advertising campaign was addressed, are themselves within the contemplation of "new policies not previously authorised by special legislation" and thus within the Compact of 1965. The changes are not concerned with limited amendment of present federal legislation, enacted by the Parliament. Instead, what appears to be intended is to "introduce a national system of workplace relations". So much is stated in the Commonwealth's advertisement, exhibited in the special case. By necessary inference, such a system would involve very significant changes to the States industrial relations systems and their replacement in an unspecified way by a "national system". It therefore appears that, pursuant to the intended changes, the Commonwealth proposes to provide services related to workplace regulation that are either entirely new, or of a kind currently provided by the States and not by federal institutions or laws. For this reason, if implemented, the reforms would not constitute services "ordinarily provided" by the Government of the Commonwealth. It follows that advertising to promote and publicise such reforms could not be described as an ordinary annual service of the Government or a service incidental thereto. It is therefore extremely unlikely that an item of appropriation for such expenditure would be found, or properly found, in Appropriation Bill No 1. Until the Parliament has spoken upon it, it cannot be assumed that legislation to implement the foregoing scheme will be enacted. The Parliament of this country is not a rubber stamp of the Executive Government. As Professor Harrison Moore pointed out in the early days of the Commonwealth, the Senate in Australia is an unusually powerful upper house. It has commonly performed a distinctive function. It is "less easily 'led' by the Government". The "'Opposition' is not so clearly defined"209. If, as an outcome of parliamentary debate, the foreshadowed legislative "package" were defeated or significantly altered, federal expenditure on an advertising campaign to promote it, in advance of its passage, would have been wasted, in whole or part. It would not therefore 209 Harrison Moore, The Constitution of the Commonwealth of Australia, 2nd ed Kirby lightly be assumed that the Federal Parliament intended, merely by general language in the Appropriation Act and its associated documents, to approve an appropriation for the advertising campaign challenged by the plaintiffs. the Interpretative principles: The plaintiffs did not challenge constitutional validity of the Appropriation Act. To this extent, the present is a case closer to the construction question unanimously resolved in Brown v West210 than to the validity question considered in the divided decision in the AAP Case211. The plaintiffs' argument accepted the validity of the Act. However, the plaintiffs submitted that, properly construed, the terms of the Act did not extend to appropriate moneys for the advertising campaign described in the materials, whether for the ordinary annual services of the Government or otherwise. The Act thus gave no lawful authority for the drawing of money from the Treasury of the Commonwealth for such a purpose. The principle that a statute, enacted by the Parliament must be construed, so far as the words permit, to remain within the powers conferred, and conforming to the restraints imposed, by the Constitution is one deeply entrenched in the law of this country212. It is given encouragement, and support, by the command of the Parliament itself in s 15A of the Interpretation Act. By that section "[e]very Act shall be read and construed subject to the Constitution, and so as not to exceed the legislative power of the Commonwealth [but to] be a valid enactment to the extent to which it is not in excess of that power". There are limits to the extent to which such interpretive provisions can save from invalidity over-reaching laws213. However, where the question presented is one initially of legislative construction, and the language permits of alternative constructions (one that is constitutionally valid and the other invalid), it can readily be assumed that the Parliament intended this Court to adopt the interpretation that involves no invalidity. The Parliament has said as much in s 15A. The plaintiffs submitted that the language of the Appropriation Act in question here, passed when the foregoing Appropriation Bill was enacted by both Houses and given the Royal Assent, read with the PBS and other budget 210 (1990) 169 CLR 195 at 212. 211 (1975) 134 CLR 338. 212 Chief Executive Officer of Customs v El Hajje (2005) 79 ALJR 1289 at 1304 [74]- [75] and cases there cited; 218 ALR 457 at 477. 213 cf APLA Ltd v Legal Services Commissioner (NSW) (2005) 219 ALR 403 at 429- 431 [92]-[95] per McHugh J, 493-494 [367]-[370] of my own reasons. Kirby documents, and understood against the background of constitutional law and history, authority and principle, supported their contention. They suggested that the language of the Act and the PBS were unambiguous. Neither contained any reference to appropriation for the advertising campaign for proposed future legislation upon which the Executive Government had embarked. Accordingly, the Parliament had as yet given no assent to it. Alternatively, the plaintiffs argued that, if there were ambiguities in the language of the Appropriation Act, understood by reference to the PBS, by reason of the same considerations, a meaning and effect of that Act should be preferred that excluded appropriation for the advertising campaign to one that accepted the appropriation as sufficiently approved in terms of a generally expressed item, such as departmental "Outcome The appropriation was not made Absence of distinct authorisation: The parliamentary appropriation for the Executive Government's advertising campaign challenged by the plaintiffs was not made. The "distinct authorization from Parliament itself" was not given for the appropriation propounded in this case214. However much the requirement of specificity and distinctiveness of appropriations is blunted by Executive Government practice, and even parliamentary acquiescence, it cannot be denuded of meaning in Australia, given the constitutional provision that requires that appropriations must be for designated purposes. Parliamentary appropriations cannot be given in blank or with no reference to a purpose. The purpose must either be declared in the Constitution itself or lawfully determined by the Parliament. In the exigencies of modern government, it may be accepted that such purpose can be declared at a level of generality. However, that generality cannot be so vague and meaningless as to negate the significant constitutional consequences that attach to the designation of the appropriation and its purpose. Were this Court to permit a departure from this rule it would turn its back on the constitutional text, ignore the long struggles that preceded it, impermissibly diminish the role of the Senate, undermine transparency in government, diminish the real accountability of the Parliament to the electors and frustrate the steps taken by successive governments and Parliaments to enhance good governance in the legislative (and specifically financial) processes of the Parliament. The facilitation of public scrutiny of economic policy and performance is the first stated object of the Charter of Budget Honesty which has been adopted 214 Auckland Harbour Board [1924] AC 318 at 326, approved in Brown v West (1990) 169 CLR 195 at 208-209. The "distinct authorization" must be either expressly or referentially granted: AAP Case (1975) 134 CLR 338 at 360. Kirby by the Parliament215. It should be assumed that the Federal Parliament meant what it said in adopting that Charter. It should therefore be presumed that enactments, including those for appropriations, are intended to fulfil this commitment to honesty, transparency and accountability and to contribute to their observance in the budget processes of the Parliament. Reasons for upholding the objections: When such tests are applied to the Appropriation Act in question here, there are many reasons to uphold the submissions of the plaintiffs and to reject those of the defendants. First, it is highly doubtful that, conformably with the Constitution and the Compact of 1965, a provision for advertising of an as yet unenacted federal law, containing radical changes to existing federal law, could amount to (or would be taken by the Parliament to include) appropriation for the "ordinary annual services of the Government". Within the Compact of 1965, any such law would clearly involve "new policies not previously authorised by special legislation". Appropriations for expenditures on such policies would accordingly fall outside appropriations for the ordinary annual services of the Government. On the face of things, this analysis supports the submission that, in accordance with s 53 of the Constitution, the Compact of 1965 and the practice of the Federal Parliament, the provisions in Appropriation Bill No 1 did not cover the advertising campaign initiated by the Government and challenged by the plaintiffs. No other legislation has been nominated to afford a relevant appropriation. It is either the Appropriation Act or it is nothing. If this conclusion is correct, this Court should not struggle to read into the general language of the Appropriation Act, considered with the PBS and supporting documents, words which the foregoing make it unlikely to expect in such a context. Secondly, when the words nominated by the defendants are examined, there is no particular item anywhere in the Appropriation Act that appropriates money to expenditure on a public advertising campaign in support of unenacted laws on the highly controversial and potentially divisive topics identified in the exhibited advertisements. This is significant in itself, but especially so when the items in the Appropriation Act, called in aid by the defendants, are contrasted with express provisions contained in that Act referring with particularity to the "promotion" of an identified policy or, specifically, communication and advertising. In such circumstances too, this Court would not struggle to turn the general language of the Act into the "distinct authorization from Parliament itself" that is required by settled constitutional law. Thirdly, when the nominated general outcomes are read, and in particular Outcome 2 upon which the defendants most strongly relied, they fall far short of 215 Charter of Budget Honesty Act 1998 (Cth), s 3, Sched 1, cl 1. Kirby providing parliamentary authorisation for the advertising campaign challenged by the plaintiffs. Obviously, Outcome 2 ("Higher productivity, higher pay workplaces") is expressed at such a high level of abstraction that, unless confined within limits, it would lend itself to authorising the appropriation of moneys for clearly illegitimate purposes. Thus, the item could not extend to cover the payment of federal bonuses to private sector employees or corporate executives (promoting "higher pay") or subsidising holiday trips ("higher pay" and "higher productivity") or providing public transport or public health facilities ("higher productivity"). To give the vague and general outcome meaning, in a legal context that includes the high constitutional purposes that I have described, a boundary must be placed around the chosen words. Otherwise, by the choice of such language, the purpose of obtaining distinct parliamentary approval of appropriations proposed by the Executive Government would be set at nought216. It should not be assumed that the Federal Parliament, in the circumstances disclosed in the present proceedings, has abandoned that degree of "distinct authorization" involved in its constitutional function of "appropriation" so as to default in, or abdicate, the performance of that function. That would be constitutionally impermissible. Where necessary, courts must read the items for a particular appropriation as it will be presumed that the Parliament itself would do217. This is achieved by viewing the item in concrete terms, confined (where unexpressed and unelaborated) to those activities and services only that are necessarily inherent in the words chosen. When this approach is adopted, there is nothing in the words "Higher productivity, higher pay workplaces" that suggests the institution of a substantial publicly funded advertising campaign in support of announced legislation, not yet enacted. Such a campaign is too remote from the achievement of "higher productivity" or "higher pay workplaces". Indeed, any linkage is tenuous in the extreme. Moreover, it is unsubstantiated on the documentary evidence placed before this Court218. 216 There are many examples showing the need to adopt this approach. For instance, the outcomes of the Department of Prime Minister and Cabinet include "sound and well coordinated government policies, programmes and decision making processes". If read broadly, this would encompass virtually any Government policy at all. 217 Thus in New South Wales v Bardolph (1934) 52 CLR 455 at 472 Evatt J cited an example to illustrate the degree of particularity required. Hence, it would require identification of expenditure on a library but not appropriation for particular books. 218 See also the reasons of McHugh J at [93]. Kirby Fourthly, this conclusion is reinforced by an awareness of the controversy, and suggested impropriety (and even illegality) of expenditures of public funds on such public advertising campaigns in the past and in support of policies not yet enacted by the Parliament219. Against the background of such controversies, it is reasonable to expect that explicit, or at least implicit, attention of the Parliament would be drawn in an Appropriation Bill to a proposal to institute such a substantial and costly advertising campaign. This Court, in defence of the principles of accountability of the Parliament to the electors, as the Constitution envisages, should continue to uphold a rule of particularity in such a case. If there is a choice of construction of the provisions of the Appropriation Act that has this effect and one that does not, it is the former that I would impute to the Parliament. Fifthly, the defendants sought to minimise the significance of the PBS relevant to the Department and the detail outlined within it. This would not ultimately assist the defendants because, without the PBS, they are left with no more than the items identified in Schedule 1 to the Appropriation Act that are stated in such general terms that, for the foregoing reasons, they would not sustain a suggested appropriation as a "distinct authorisation" for a campaign of the kind, and for the purpose, that was launched. This argument must, in any case, be rejected because of the clear contemplation in s 4 of the Appropriation Act that that Act was to be read with the PBS as "relevant documents" and that the PBS was to be used in assisting the ascertainment of the purposes for which the expenditure was authorised by the Parliament. In achieving the purposes of appropriation contemplated by the Constitution, the PBS introduced a new and different problem for transparency and accountability. This is the inundation of the Parliament, the electors and (where applicable) this Court, with a vast mass of materials, commonly still expressed in vague generalities, that make practical examination of particular and distinct appropriations difficult or next to impossible. However, at least by reference to the PBS and other budgetary papers, interested experts, the specialised media and political critics within and outside the Executive Government, can that may be considered debatable or objectionable220. By doing so, they render the Executive Government accountable to the Parliament. They may occasion legislative amendments including (as history shows) at the request of the Senate. They permit the identify items 219 Lindell at 22. 220 As to the use of supplementary materials see AAP Case (1975) 134 CLR 338 at Kirby branches of Government to play their respective roles, as the Constitution envisages. These are arguments for adopting the submissions of the plaintiffs in respect of the functions of the PBS, so far as they elaborate the proposed activities and outcomes of the Department in issue here. They are reasons for rejecting the arguments of the defendants which would reverse the approach adopted by this Court in Brown v West. The defendants' approach to the meaning and effect of the Appropriation Act would approve a constitutional procedure of appropriation (and the drawing of funds pursuant to a grant) that is devoid of any meaning. This does not conform to the imperative language of the Constitution and especially the command of s 83. In his reasons Gleeson CJ221 suggests that the test is whether the identified "outcomes", concededly stated in very general terms, are so general as to be without meaning. With respect, this puts the bar too low. It overlooks the duty, traced ultimately to the Constitution, to identify a sufficient meaning to fulfil the purpose of an appropriation. Likewise, Gleeson CJ222 rejects what he calls a "judge's intuition" as an insecure foundation for discerning a rational connection between an output and an income. But this cannot mean that judicial analysis is pointless because that is precisely what the rule of law requires. Otherwise, this Court might just as well renounce the function it has hitherto asserted to uphold the legislative and constitutional requirements in the matter of appropriation. Nor is it the Chief Justice's suggestion that such issues are political223, persuasive or even relevant. All constitutional decisions have political consequences. That has never in the past stopped this Court from doing its duty224. In the interpretation of the appropriation law considered in Brown v West, this Court spoke with a unanimous voice. It should do so again in these proceedings. The question raised is closely analogous. The constitutional, historical and policy reasons for doing so are relevantly identical. True, there is not in this case a clash between an appropriation statute and an earlier federal law, said to be inconsistent as there was in Brown v West. But here, it is the very absence of any federal law that supports the proposition that the appropriation statute was not intended to authorise funds publicly to attack laws that the Parliament has earlier enacted and that remain in force until lawfully changed. 221 Reasons of Gleeson CJ at [27]. 222 Reasons of Gleeson CJ at [12]. 223 Reasons of Gleeson CJ at [28]-[29]. 224 See Melbourne Corporation v The Commonwealth (1947) 74 CLR 31 at 82 per Kirby This Court should make it clear that, if such an advertising campaign is ever to be permitted in such a case, using money drawn from the Treasury of the Commonwealth, it cannot occur "except under a distinct authorization from Parliament itself". And that was missing in this instance. Conclusion: No valid drawing: The result is that there was no appropriation made by law, under the Appropriation Act or otherwise, to authorise the drawing of money from the Treasury of the Commonwealth for the advertising campaign described in the special case, as contemplated in the instrument signed by the Secretary of the Department. The Appropriation Act, of itself, "earmark[s]" money which, until disposed, remains the property of the Commonwealth225. However, such an Act discloses that the Parliament consents to the expenditure of the moneys raised from the people, appropriated for the purposes stated in the appropriation. Only then may the Executive Government, within the law, expend those moneys, being thereby given the "authority and opportunity" to do so226. As has been said many times, an appropriation law wears a double aspect227. It authorises expenditure. But by s 83 of the Constitution, it also forbids the drawing from the Treasury of moneys except in accordance with the appropriation law. It grants. And it restricts. Each aspect is equally important to the constitutional design. The residual issues require decision: It is the issuance of drawing rights to meet expenses under a supposed appropriation, which does not on analysis exist, that enlivens past and prospective breaches of the law of the Constitution (as well as other federal law). It is those breaches, and any anticipated future such breaches of a like kind, that give rise to an entitlement to relief. That entitlement is subject to the residual issues in these proceedings. Are the challenges presented by the plaintiffs justiciable? Do they have standing to make them? Can the plaintiffs formulate orders for relief, in terms that will enjoin the unlawful expenditure and that only? Are there any residual discretionary reasons why relief should be refused in the circumstances? How should the Court provide for costs in the light of the resolution of all of the issues? It is necessary to turn to these residual issues. However, before doing so, I will make some brief comments in relation to the reasons of Gleeson CJ and the 225 AAP Case (1975) 134 CLR 338 at 411 per Jacobs J. 226 The Commonwealth v Colonial Ammunition Co Ltd (1924) 34 CLR 198 at 222. 227 AAP Case (1975) 134 CLR 338 at 392 citing The Commonwealth v Colonial Ammunition Co Ltd (1924) 34 CLR 198 at 224 per Isaacs and Rich JJ. Kirby joint reasons. In my view, the approaches adopted by the majority are seriously flawed. The infirmity of the majority reasons The reasons of the Chief Justice: Neither Gleeson CJ228 nor McHugh J229 agrees in the construction of the Act adopted in the joint reasons. Both approach the question of statutory construction presented by the special case in the same manner as I do. However, Gleeson CJ comes to an outcome opposite to that reached by McHugh J and myself, finding that the appropriation in question falls within the terms of Outcome 2. The reasons why I reject this conclusion will be apparent from what I have already said. It does not logically follow that, because the provision of legislative advice and the development of legislation fall within the scope of Outcome 2, advertisements for a public campaign to procure support for intended legislation also come within that outcome230. There is a clear difference between legislative and policy development, on the one hand, and political advertisements of the kind exhibited in this case, on the other. On no rational basis231 can such advertisements be seen to promote "higher productivity or higher pay". Still less do they constitute "providing policy advice and legislation development services to government". The interpretation in the joint reasons: The joint reasons strike out on a novel approach. They reject the construction of the Act advanced by the plaintiffs (and accepted by the defendants232). They hold that, because of a difference between the text of s 7 and s 8 of the Appropriation Act, an amount of money appropriated from the Consolidated Revenue Fund in respect of a departmental item is not limited to "expenditure for the purpose of achieving any of the nominated outcomes"233. That is, the designated outcomes do not restrict the expenditure of the appropriated amount in any way. The sole requirement imposed by the Act is that "a departmental item be expended only on 228 Reasons of Gleeson CJ at [23]-[26]. 229 Reasons of McHugh J at [81]-[91]. 230 cf reasons of Gleeson CJ at [28]. 231 See reasons of McHugh J at [92]-[95]. 232 [2005] HCATrans 650 at 4292-4297. See also the reasons of McHugh J at [75]- [79], setting out the relevant submissions of the defendants. 233 Joint reasons at [128]. Kirby 'departmental expenditure'". On this footing, the joint reasons dismiss the plaintiffs' "central contention". On that basis, they refuse the relief sought234. Assuming that this construction of the Act is correct, it would not follow that the plaintiffs' case must fail. Rather, the construction favoured in the joint reasons shifts the focus of the question for decision from a contest over the scope of the relevant "outcomes", to one over the meaning of the term "departmental expenditure". This is because, if it is accepted that a departmental item may only be expended on "departmental expenditure", two supplementary questions of construction arise. The first is, what meaning is to be given to the term "departmental expenditure"? The second is, does expenditure on advertising promoting the proposed changes to federal law fall within the term as so defined? A defective procedure: Unsurprisingly, neither party to these proceedings made considered submissions on these issues. This is so because the basic approach to the Act put forward by the plaintiffs represented common ground. Although the interpretation now favoured by the joint reasons was briefly raised by members of the majority during argument235, neither party was invited to provide supplementary submissions. Similarly, although it is true that the principal weight of the plaintiffs' case was placed on the proposition that the impugned expenditure did not fall within Outcome 2 (presumably because this was the justification suggested by the defendants), the plaintiffs also advanced the argument, in response to queries from the Bench in relation to the contrast between s 7(2) and s 8(2), that the phrase "departmental expenditure" must relate to one of the three relevant departmental outputs. During argument in chief236, in response to a series of questions by Gleeson CJ237, counsel for the plaintiffs, agreed that an appropriation for a departmental item could "move between" the three specified outcomes. He argued that "departmental expenditure" is not defined. In the context it meant expenditure on departmental items "on or for the purpose of departmental outputs"238. That interpretation of the Appropriation Act should be accepted. Indeed, it is accepted by Gleeson CJ who was presumably satisfied with the answers that his questions had elicited. Not so the joint reasons. 234 Joint reasons at [134]. 235 [2005] HCATrans 650 at 6905. See also at 4254-4276, 5015, 5020. See reasons of 236 cf joint reasons at [127]. 237 [2005] HCATrans 633 at 2010-2030, esp at 2030. 238 [2005] HCATrans 633 at 2013-2017. Kirby The absence of substantive argument, from the parties and the intervener, may explain why so little attention is given in the joint reasons to the meaning of the expression "departmental expenditure". The point was simply not examined before the Court in a way that subjected the propounded interpretation to the stringent analysis required by a case of this importance. Because the decision in the joint reasons turns on this construction of the Appropriation Act, I will make a number of observations about it. Necessarily, I must do so without the benefit of full submissions of the parties; scrutiny of the relevant Australian and other parliamentary procedures; and examination of any additional constitutional submissions by governmental parties that such an approach might have elicited, if it had been put on proper notice239. The phrase "departmental expenditure" is undefined in the Appropriation Act. That does not mean that it has no meaning, or that its meaning cannot be ascertained from the text, structure and context of the Act. "Expenditure" is defined in s 3 of the Appropriation Act to mean "payments for expenses, acquiring assets, making loans or paying liabilities". On one view, then, (and this appears to be the view accepted by the joint reasons) "departmental expenditure" is a virtually unconstrained concept. Its scope includes any money expended by the department on departmental expenses, assets, loans or liabilities. On this approach, the focus of the appropriation is the entity that performs the expenditure. It is not the subject matter of that expenditure. If money is expended by a department, it is "departmental expenditure" within the meaning of s 7 of the Appropriation Act. End of question. Inconsistency with statutory scheme: Apart from the obvious circularity of this construction of the Appropriation Act, it presents many difficulties. First, it is not consistent with the scheme of the Appropriation Act itself, the accompanying budget papers and the explanatory material. As outlined earlier, these materials all indicate that the federal parliamentary appropriations system is designed to revolve around outcomes and outputs. No distinction is made in this regard between departmental items and administered expenses, whether in Schedule 1 of the Appropriation Act240, the budget papers or the other materials. It would be an astonishing result if the Parliament, having gone to all the trouble of designing and implementing the complicated appropriations system which 239 cf Chief Executive Officer of Customs v El Hajje (2005) 79 ALJR 1289 at 1295 [28]; 218 ALR 457 at 464. Note that in that case a reference to a constitutional argument was criticised although it was confined to one that merely offered a context for interpretation. Here, the consideration embraced in the joint reasons is determinative of the outcome of the entire proceedings. 240 See the reasons of Gleeson CJ at [26], noting that Sched 1 identifies outcomes even where there are no relevant administered expenses. Kirby operates by reference to departmental outcomes, then proceeded to appropriate a great part of federal revenue in a manner falling outside that system that it had so painstakingly adopted. Inconsistency with statutory provisions: Secondly, such a broad and unrestricted interpretation of "departmental expenditure" is contrary to the meaning of that term as indicated by the Appropriation Act. A note accompanying s 7(2) of that Act provides that: "The acquisition of new departmental assets will usually be funded from an other (sic) departmental item (in another Appropriation Act)." This note indicates that the meaning of "departmental expenditure" has (and is intended to have) distinct limits. If this were not the case, and the wide view of s 7 of the Act were accepted, as favoured in the joint reasons, the "acquisition of new departmental assets" would clearly fall within the scope of "departmental expenditure". It would therefore be authorised by an appropriation under s 7. The note, with its reference to other items, would be redundant on this construction. By way of contrast, the note as expressed is consistent with an understanding of "departmental expenditure" which is informed not only by the relevant outcomes and outputs, but also by applicable parliamentary practice and the governing constitutional principle. Appropriation for capital expenditure on departmental assets is not usually considered to be expenditure for the "ordinary annual services of the Government"241. According to the Compact of 1965, such an appropriation should therefore be included in an Appropriation Bill No 2, which is subject to amendment by the Senate. Consistently with the note accompanying cl 7 of the Appropriation Bill (now s 7 of the Appropriation Act) it would therefore be expected that an appropriation for "departmental expenditure" under the Appropriation Act would not extend to the acquisition of important new departmental assets. Thus, contrary to the view embraced in the joint reasons, and consistently with the long-standing parliamentary practice revealed in the evidence, the note indicates that the phrase "departmental expenditure" is subject to expressed limits. The joint reasons place great weight on the note accompanying the definition of "departmental item"242. However, as explained, the note indicates that a measure of flexibility has been incorporated into the appropriation system243. By s 7 of the Act, read with the definition of "departmental item", the 241 See the Compact of 1965, par 2(b) and (c), noted above in these reasons at [248]. 242 Joint reasons at [129]-[132]. 243 See above these reasons at [201]. Kirby Appropriation Act permits the transfer of sums between the identified outcomes for each departmental item. Significantly, the note only refers to the "amounts set out opposite outcomes". It does not refer to the outcomes themselves. Only the amounts are said to be "notional". Only the amounts are stated not to "restrict the scope of the expenditure authorised by the item". This suggests strongly that the "outcomes" are intended to be more than "notional". They are intended to "restrict the scope of the expenditure authorised by the item"244. With all respect, the note, therefore, provides no support for the contention in the joint reasons that the expressly specified outcomes are to be ignored in relation to departmental items. If that had been the Parliamentary purpose, it would have been easy enough, in the note accompanying the definition of "departmental item" or elsewhere, for the drafter to have indicated that neither the outcomes nor the related amounts restricted the scope of expenditure authorised by the item. Unsurprisingly, given the context, there is no such provision. Inconsistency with constitutional doctrine: Thirdly, and most importantly, the interpretation of s 7 of the Appropriation Act accepted by the joint reasons in my view involves potential constitutional invalidity245. It posits an appropriation without a purpose sufficiently stated to satisfy the requirements of s 81 of the Constitution. In Attorney-General (Vict) v The Commonwealth Latham CJ, rejecting "appropriation in blank", stated that246: "An Act which merely provided that a minister or some other person could spend a sum of money, no purpose of the expenditure being stated, would not be a valid appropriation act." This settled constitutional doctrine was not challenged these proceedings. It was accepted by both sides. An appropriation cannot therefore validly be made in such a way, only by reference to the person or entity to which the money is appropriated. A purported appropriation in such terms would be invalid for want of sufficiently identifying a "purpose". On this basis, if the term "departmental expenditure" is given an unrestricted meaning, the appropriation in s 7 amounts to an impermissible "appropriation in blank". Unless the term "departmental expenditure" is given more specific content, and unless its scope is limited by the specified outcomes (or by some other means), it is an appropriation by reference to the repository to which the money is appropriated, rather than an appropriation by reference to the purpose of the expenditure of that 244 See reasons of McHugh J at [86]. 245 See reasons of McHugh J at [89]. 246 (1945) 71 CLR 237 at 253. See above these reasons at [233]. Kirby entity. Such an interpretation must be rejected because it would impute to the Parliament an intention to infringe the Constitution. No such intention should be accepted because none was asserted by any party and all indications in text, practice and history are that the opposite was the parliamentary purpose. Meaning of "departmental expenditure": The Appropriation Act itself provides the tools required to give the term "departmental expenditure" (and hence the appropriation in s 7) the necessary constitutional purpose. Such tools are the outcomes and outputs identified in Schedule 1, and elaborated in the PBS. It follows that "departmental expenditure" in the present context should be understood to mean expenditure by a department for the purposes of the outcomes specified in Schedule 1247. By virtue of s 4, such outcomes must be read in light of the information provided by the PBS. This interpretation avoids potential problems of constitutional invalidity. It gives support to parliamentary supervision of the Executive Government in financial matters (as mandated by the Constitution). It is consistent with the appropriations scheme established by the Parliament itself, as demonstrated by the Appropriation Act, budget papers and other explanatory material. It avoids treating such materials as an elaborate and immaterial charade. It attributes to the Parliament the purposes of good governance, financial transparency and accountability, repeatedly stated in federal laws and ministerial statements248. It follows that the impugned expenditure is not authorised by the relevant departmental item. An unreasonable outcome: One final point should be noted in relation to the approach adopted in the joint reasons. It is undesirable that this Court should decide significant issues of statutory and constitutional law, such as those presented by the present proceedings, on a substantially unanalysed point of statutory construction. That point was only dealt with in passing, and then in response to isolated questions from the Court, with no notice so as to stimulate considered submissions. The issues presented by both of the parties in this case concerned matters important to Australia's system of parliamentary democracy. Such questions were properly argued before the Court249. The parties were well represented and they advanced considered arguments. It is the duty of this Court to grapple with the matter brought before it and to resolve that matter. True it is that the parties, including in cases involving the Constitution, cannot finally 247 This approach was accepted by the defendants: [2005] HCATrans 650 at 4292- 248 Such as those referred to above, these reasons at [259]. 249 Pursuant to the Constitution, ss 75(iii) and 75(v). Kirby define the legal issues that the Court must decide250. However, if the Court is to embark on a different approach, it requires a sounder procedure than was followed in these proceedings. This Court is the ultimate body reposed with the duty to interpret and uphold the Constitution. It has no higher responsibility or purpose. To dispose of these proceedings, as the joint reasons do, on an unconvincing interpretation of the Appropriation Act, alien to the Constitution and to Australian parliamentary practice, advanced by no party, hypothesised from the Bench and answered on the run, is an unreasonable way of concluding such an important controversy. It involves the Court in a departure from its own past unanimous authority251 and from its clear constitutional duty in this case. Justiciability and standing The issue of justiciability: To arrive at the orders that I favour, I am obliged to respond to the remaining arguments that the defendants advanced to resist the claims of the plaintiffs to relief. They were substantive arguments. It is necessary for me to address them. The defendants did not assert that the issue of the lawfulness of a suggested expenditure, outside an appropriation, was inherently non-justiciable. However, they pleaded that the plaintiffs did not have standing. To that extent, they argued, there was no constitutional matter before the Court engaging its jurisdiction and powers252. It was in that sense only that the defendants contended that the issues presented by the plaintiffs were non-justiciable. In the AAP Case253, Barwick CJ dealt with the justiciability of those proceedings in terms that I regard as correct. If an Appropriation Act is beyond the powers of the Parliament, like any other statute with such a flaw, it is invalid. The power of this Court so to declare is, in such a case, "beyond question". It is "an essential feature of the Australian Constitution that the Court, in the exercise of the judicial power of the Commonwealth, not only may declare acts of the 250 See eg Roberts v Bass (2002) 212 CLR 1 at 54-55 [143]-[144]. 251 Brown v West (1990) 169 CLR 195. 252 They relied on Re McBain; Ex parte Australian Catholic Bishops Conference (2002) 209 CLR 372. See eg at 449 [204]. 253 (1975) 134 CLR 338 at 364. Kirby Parliament to be void but, when approached by a litigant with an appropriate interest in the statute or its operation, is under a duty to do so"254. It is true that an annual Appropriation Act has unique characteristics. It has been described as fiscal and not regulative in character255 because it does not confer any legal rights or impose any duties on ordinary citizens. In some respects, an Appropriation Act therefore concerns matters internal to the workings of the Parliament. As such, a challenge to an Appropriation Act may raise difficulties of justiciability and standing according to the usual principles of judicial review256. However, as Professor Cheryl Saunders has observed, these characteristics are neither "so extreme nor so different from the norm as to isolate an Appropriation Act from the general body of statute law"257. Indeed, the annual Appropriation Act has an effective and crucial legal consequence: it authorises expenditure of the revenue of the Commonwealth that would otherwise be unconstitutional and hence unlawful258. There is no reason why an annual Appropriation Act, once enacted, should not be subject to judicial examination in the way that any other federal law may be, whether pursuant to a direct constitutional challenge or on a question of statutory construction (as in the present case). Given the essential role played by the annual Appropriation Acts in our system of government, there are strong reasons of principle and policy to support the proposition that an Appropriation Act, and the action of the Executive Government pursuant to such an Act, should be amenable to judicial supervision in the usual way. Any other conclusion would undermine a fundamental precept of our constitutional tradition that the Parliament controls the appropriation and expenditure of public monies259. To 254 (1975) 134 CLR 338 at 364. In the United States, in a number of cases the Supreme Court has found particular appropriations and expenditures beyond power: United States v Butler 297 US 1 at 74, 87 (1936): see AAP Case (1975) 134 CLR 338 at 359. 255 See eg AAP Case (1975) 134 CLR 338 at 386-387, 393. 256 See Davis v The Commonwealth (1988) 166 CLR 79 at 96. 257 Saunders, "Parliamentary Appropriation", in Saunders et al (eds), Current Constitutional Problems in Australia, (1982) 1 at 36. 258 Brown v West (1990) 169 CLR 195 at 208; Saunders, "Parliamentary Appropriation", in Saunders et al (eds), Current Constitutional Problems in Australia, (1982) 1 at 36. 259 Australian Tape Manufacturers Association Ltd v The Commonwealth (1993) 176 CLR 480 at 505-506. Kirby forbid judicial scrutiny at the suit of a person with a requisite interest would be to undermine a feature that lies at the heart of the Constitution260. In this case, constitutional invalidity is not, as such, in issue. But the meaning and effect of the Appropriation Act, as a law of the Commonwealth, are. The question of statutory construction so presented is justiciable. Defining the law that can be carried into effect (and, where relevant, pronouncing whether that law is valid or not) is part of the function of the judiciary essential to the federal form of government. Specifically, it is one of the duties of this Court under the Constitution261. I agree with the opinions of the majority of this Court in the AAP Case and with the opinion of the entire Court in Brown v West that no reason exists for placing Appropriation Acts in an exceptional position of "constitutional inviolability"262 or of placing the meaning and effect of such laws outside of the scrutiny of this Court. This Court also has the function and duty of pronouncing on the validity of the action of the Executive Government when it is challenged. In accordance with s 75(v) of the Constitution, it may decide the lawfulness of the acts and omissions of an officer of the Commonwealth and provide relief directed to such officer and to the Commonwealth as envisaged in that provision of the Constitution and in other federal law. In the AAP Case, Gibbs J suggested that the justification for review by the courts of the validity of acts of the Executive Government was conceptually stronger than in the case of review of the validity of legislation enacted by the Parliament263. However that may be, as it was developed, the challenge in these proceedings was not to the validity of the Appropriation Act. The plaintiffs upheld the Act. Indeed, they relied upon it. What was presented for decision was nothing more nor less than a determination of the meaning and effect of an Act. This is a standard task performed every day by this Court and other Australian courts. Subject, therefore, to the disputed issue of standing, it follows that there is a matter before this Court, within the Constitution, apt for judicial resolution. It involves a controversy that is suitable for judicial determination and justiciable. 260 Australian Communist Party v The Commonwealth (1951) 83 CLR 1 at 193; Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476 at 492 [31], 513 261 cf The Queen v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 at 267-278 cited by Gibbs J in the AAP Case (1975) 134 CLR 338 at 379. 262 AAP Case (1975) 134 CLR 338 at 380 per Gibbs J. 263 (1975) 134 CLR 338 at 380. Kirby To the extent that the defendants questioned the justiciability of the plaintiffs' proceedings, their arguments should be rejected. Standing in federal causes: The defendants strongly contested the standing of the plaintiffs, and each of them. Although Western Australia intervened, the Attorney-General for that State did not (as he might have done) issue a fiat to the plaintiffs, or either of them, to permit them to bring the proceedings by his authority. Nor did the Attorney-General elect to bring the proceedings in the name of the State. Had this been done, on the present authority of this Court264, the challenge to the plaintiffs' standing would have disappeared. It cannot be the case that serious questions concerning the meaning and operation of federal law in the Australian Commonwealth, as read in the light of the federal Constitution, can only be brought before the Judicature for resolution by the Commonwealth, by a State or Territory, by an Attorney-General or by a party with a financial or similar interest in the issue presented. That view of the standing of individuals to challenge federal laws and Executive acts takes too traditional and mercantile a view of the requirements of standing to be appropriate to a federal polity. It involves the unthinking importation into the resolution of federal constitutional and legal questions in Australia of judicial authorities on standing, originally devised in England for purposes quite different from those involved in deciding matters arising under the Australian Constitution and federal law265. For at least the past fifty years, this Court has repeatedly said that the principle of the rule of law underlies Australia's constitutional text and its operation266. Whilst the Commonwealth, the States, the Territories and (by tradition or statute) the Attorneys-General have standing to bring proceedings before this and other courts, concerning enforcement of the Constitution and challenges to federal Executive action, they are not alone in enjoying such rights. To hold this would be to undermine the commitment of the Constitution, and the Judicature which it creates, to upholding the rule of law for all persons, where the law is seriously challenged. 264 Victoria v The Commonwealth (1926) 38 CLR 399 at 406-407; AAP Case (1975) 134 CLR 338 at 365-366 per Barwick CJ, 383 per Gibbs J, 401-402 per Mason J; Attorney-General (Vict); Ex rel Black v The Commonwealth (1981) 146 CLR 559 265 AAP Case (1975) 134 CLR 338 at 391, 424-425. 266 Since the Australian Communist Party v The Commonwealth (1951) 83 CLR 1 at Kirby Sometimes, there will be no government willing to mount such a challenge. However, the Constitution is more than a congenial arrangement between governments. Its ultimate foundation rests on the assent of the citizens as electors of the Commonwealth. To them is reserved267 the power of final concurrence in formal constitutional amendments268. With this in mind, there is a need to re-express the requirements of standing in constitutional and related litigation269. What has been said in other cases and other circumstances may not be equally applicable to proceedings brought by plaintiffs such as the present270. federal, involves an invocation of Seeking the relief of an injunction, as expressly provided by s 75(v) of the Constitution, indeed constitutional, jurisdiction. It would be a mistake to graft onto a claim for such relief, especially before this Court, all of the learning that was devised in respect of the provision of equitable relief in private litigation. Necessarily, in matters of public law, potentially there is an additional interest. This is the interest of the public generally to ensure the compliance of officers of the Commonwealth with the law, specifically the law of the Constitution and federal enactments that bind such officers. It would be a serious misdescription to suggest that the only interests of the plaintiffs in these proceedings were "intellectual" or "emotional". Nor could it be said that the only interests of the plaintiffs are those of being members of the public, electors of the Commonwealth or taxpayers (assuming that such interests are not themselves sufficient for standing in proceedings of the present kind)271. 267 Under the Constitution, s 128. 268 See eg Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 138 per Mason CJ; Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 70 per Deane and Toohey JJ. 269 It has been suggested that the relator procedure is not appropriate to the Australian judicial system because of the function that Attorneys-General play as Ministers in the Executive Government: see AAP Case (1975) 134 CLR 338 at 425 per 270 The unreality of relying on an Attorney-General to provide standing suggests the need for re-expression of the rules of standing in public law: Lindell at 26. See also Bateman's Bay Local Aboriginal Land Council v Aboriginal Community Benefit Fund Pty Ltd (1998) 194 CLR 247 at 260-267 [33]-[48], 284-285 [107]- [109]; Re McBain (2002) 209 CLR 372 at 449-450 [206]. 271 cf Flast v Cohen 392 US 80 (1968). See AAP Case (1975) 134 CLR 338 at 389; see also at 381. Kirby The parliamentarian's standing: Take the second plaintiff, Ms Roxon, She is a member of the Federal Parliament, in the House of first. Representatives. She is therefore a person with a status repeatedly recognised by the Constitution272. As a Member of Parliament, she has a particular interest in ensuring obedience by the Executive Government to the requirements prescribed by the Constitution and by federal law273. In my view, this gives her a special interest in the subject matter of the present proceedings274. She is seeking to enforce a public right. She is claiming, in effect, that on the Executive Government's case and its actual or prospective drawing of funds, the law of appropriations has not been observed or may not be observed in the future unless this Court grants relief. She seeks confirmation that such law will now be observed and that any drawing of funds will only be made "under appropriation made by law"275. On any basis, this is a serious question apt for judicial decision. It is not raised by an intervener or someone with a vexatious or purely hypothetical interest in the resolution of the issue. The second plaintiff therefore has a sufficient special interest to sustain the proceedings that she has brought. I can reach this conclusion without deciding wider questions about the entitlement of taxpayers or electors of the Commonwealth or others more generally to bring proceedings under s 75(v) of the Constitution in federal causes. Similarly, it is unnecessary for me to consider the second plaintiff's alternative argument that she enjoyed the identical standing as Mr Brown in Brown v West as "Shadow Attorney-General", the Opposition representative on legal affairs. The defendants argued that in Brown v West it was not Mr Brown's status as a Parliamentarian or "Shadow Minister", as such, but his personal interest in the existence, or absence, of a supposed additional postal allowance, that afforded him standing in that case. The only reason Mr Brown enjoyed that purported entitlement was because he was a Member of Parliament. However that may be, the words of Gibbs J in the AAP Case remain that 272 Constitution, ss 24, 26, 27, 29, 30, 31, 32, 33, 34, 35, 36, 37, 38, 39 and 41. 273 cf Cormack v Cope (1974) 131 CLR 432 at 459. 274 See Australian Conservation Foundation v The Commonwealth (1980) 146 CLR 493 at 511, 530-531, 547-548; Onus v Alcoa of Australia Ltd (1981) 149 CLR 27 at 37; Shop Distributive and Allied Employees Association v Minister for Industrial Affairs (SA) (1995) 183 CLR 552 at 558; Bateman's Bay (1998) 194 CLR 247; APLA Ltd v Legal Services Commissioner (NSW) (2005) 219 ALR 403 at 436 [116] per Gummow J, 469 [274]-[275] of my own reasons. 275 Constitution, s 83. Kirby as true today as when they were written: "[W]hatever may be the position in the United States, where there is a complete separation of the executive from the legislative power, I would, in Australia, think it somewhat visionary to suppose that the citizens of a State could confidently rely upon the Commonwealth to protect them against unconstitutional action for which the Commonwealth itself was responsible"276. The broader arguments of the second plaintiff may one day be upheld in a proceeding such as the present. For present purposes, in relation to the meaning and effect of a law on appropriations, it is sufficient to accept the second plaintiff's interest as a Member of the Parliament to whom the contested Appropriations Bill, the PBS and budget papers were presented for approval and enactment and who seeks to keep the Executive Government within the law. This was a special interest. Standing of the union official: This conclusion disposes of the defendants' objections to standing and justiciability of these proceedings. If one of the plaintiffs has standing those questions, as presented, evaporate. However, I am not convinced that the first plaintiff, Mr Combet, lacked standing of his own to initiate the proceedings. Assimilating him (as the defendants accepted) to the ACTU, his interest in challenging the advertising campaign, funded from the public purse, was clearly related to the role that the ACTU was playing in the political and industrial debate concerning the proposed amendments to federal workplace relations laws. This was the subject of the advertising, the payment for which was in question. The first plaintiff's interest in the proceedings is not ephemeral, purely intellectual or emotional. The first plaintiff, and the organisation he represents, have a real and substantial interest to curtail a purported reliance on an appropriation of public money for the Executive Government's advertising campaign. He, and the ACTU, have a direct interest to attempt to prevent the drawing of such money from the Treasury without lawful approval of a parliamentary appropriation for that purpose. Such an interest, whilst raising public law considerations, probably involves in this case the kind of mercantile and economic "special interests" often given weight in decisions on standing in private litigation. In the unequal battle between advertising privately funded by the ACTU and its supporters and advertising funded by the Executive Government from the Consolidated Revenue Fund, the winner is not hard to predict. As with the second plaintiff, it is unnecessary to consider whether the first plaintiff's status as a taxpayer, or an elector, would alone be sufficient to sustain his standing in the proceedings. 276 AAP Case (1975) 134 CLR 338 at 383; cf Bateman's Bay (1998) 194 CLR 247 at 262 [37]; Abebe v The Commonwealth (1999) 197 CLR 510 at 528 [32]; Truth About Motorways (2000) 200 CLR 591 at 611-612 [45]-[50] per Gaudron J, 629 [100] and 637 [122] per Gummow J, 659-660 [176]-[180] of my own reasons. Kirby McHugh relying on British Medical Association v The Commonwealth277 and The Real Estate Institute of NSW v Blair278, holds that the first plaintiff like the ACTU does not have standing. However, these cases were decided more than fifty years ago, before this Court elaborated its views on the requirements of standing in public interest litigation. The cited decisions have been overtaken by subsequent developments of legal doctrine279. Therefore, for the foregoing reasons and based on the current law (as stated in Onus and similar cases), it is likely that the ACTU, as represented by the first plaintiff, has standing in this matter. Conclusion: a decision is required: It follows that the second plaintiff had the legal standing necessary to bring the proceedings. The first plaintiff may also have had such standing but it is not necessary for me to reach a final conclusion on that question. The second plaintiff's standing disposes of that issue. The defendants' contentions to the contrary, and the related suggestion that, in consequence, the issues presented by the plaintiffs were non-justiciable, fail. The provision of relief and discretion Relief in earlier appropriation cases: The defendants submitted that the plaintiffs had found it impossible, within the words of Jacobs J in the AAP Case, to "identify any expenditure which is impugned and to frame a prayer for relief in terms which will enjoin that expenditure and that only"280. In formulating the suggested relief which they asked this Court to provide, the plaintiffs were mindful of the difficulty of doing so mentioned not only in the AAP Case but also in the closing words of this Court's reasons in Brown v West281. There, the Court acknowledged that there were difficulties in the way of 277 (1949) 79 CLR 201 at 257. 278 (1946) 73 CLR 213 at 224, 226, 228. 279 See Onus (1981) 149 CLR 27 at 37; Bateman's Bay (1998) 194 CLR 247. In Shop Distributive and Allied Employees Association (1995) 183 CLR 552 at 557-558, this Court held that the union had a special interest sufficient to ground standing. It assumed that the interest of the union was the same as that of its members. See also Australian Institute of Marine and Power Engineers v Secretary, Department of Transport (1986) 13 FCR 124 at 133-134 per Gummow J. 280 (1975) 134 CLR 338 at 411. 281 (1990) 169 CLR 195 at 212-213. Kirby making the declarations that Mr Brown had sought. Nevertheless, by necessary inference from the orders that ensued, this Court did not treat the proceeding in Brown v West as doomed to fail on the ground that the provision of relief was futile and its formulation impossible. On the contrary, the Court allowed the demurrer to the amended defence which had claimed that the additional entitlements for postal allowances were supported by "the authority of the Executive and … the Supply Act (No 1) 1989-1990"282. Clearly, therefore, this Court contemplated that, in the trial of the action in that matter, freed from the demurrer, relief could be framed which would uphold the plaintiff's application for a judicial determination. As appears from the report, the only relief sought in Brown v West was a declaration that the Minister had no power to alter the existing postage allowance or to apply the public moneys of the Commonwealth in providing an increased allowance. The same relief was claimed against the Commonwealth283. The report in Brown v West does not indicate that the plaintiff had sought an injunction. Reformulation of relief: In the course of argument in the present proceedings, the plaintiffs reformulated the relief that they sought. They claimed a declaration that: "The drawing of money from the Treasury of the Commonwealth for the purpose of making payments to meet expenses incurred by the first defendant under contracts and arrangements for and in relation to the advertisements referred to in sub-paragraph 11(a) and 11(b) of the special case is not authorised by the appropriation made in respect of the departmental item for the Department of Employment and Workplace Relations in Appropriation Act (No 1) 2005-2006 (Cth)". Alternatively, or additionally, the plaintiffs sought a declaration that: "The drawing rights issued by a delegate of the third defendant on 23 August 2005 under s 27 of the Financial Management and Accountability Act 1997 (Cth) are of no effect in so far as they purport to authorise the debiting of an amount against the departmental item [so described] for the purpose of making payments of public money to meet expenses incurred by the first defendant under contracts and arrangements for and in relation to the advertisements referred to in sub-paragraphs 11(a) and 11(b) of the special case". These declarations identify, with the particularity demanded by Jacobs J in the AAP Case, the appropriation to which they are successively addressed. 282 (1990) 169 CLR 195 at 200. 283 (1990) 169 CLR 195 at 200. Kirby The making of a bare declaration would have defects, even in proceedings of this kind284. However, there is sufficient evidence concerning the incurring of past obligations for expenditure of substantial public funds on the advertising campaign to warrant the issue of an injunction under s 75(v) of the Constitution. Such an injunction should be addressed to the third defendant restraining him, by himself or his delegates, from: "Issuing any further drawing right under section 27 of the Financial Management and Accountability Act 1997 (Cth) purporting to authorise the payment of public money for the purpose of any advertisement promoting proposed amendments to the workplace relations laws of the Commonwealth in the form, or to the effect, of the advertisements referred to in sub-paragraphs 11(a) and 11(b) of the special case, on the authority of the departmental item for the Department of Employment and Workplace Relations in Appropriation Act (No 1) 2005-2006 (Cth)". So formulated, the declarations and injunction would give effect to the determination of serious issues of principle, drawing upon constitutional provisions that have been litigated in these proceedings. Where such questions are disclosed and resolved in favour of a party that has standing to bring them, it is essential that this Court, maintaining its constitutional function and upholding the public law of the Commonwealth, should fashion remedies appropriate to meet the case. I agree with the remark of Gibbs J in the AAP Case, that earlier statements on the issue of standing "sometimes made under the influence of principles of private law" are "not entirely applicable to constitutional cases"285. The same comment must be made in respect of the fashioning of remedies. Where parties with a requisite interest demonstrate defects in compliance with federal statute law, as that law is understood in the light of the Constitution, it behoves this Court to say so and to afford relief that gives practical effect to the Court's conclusions286. To treat great disputes involving the meaning of the Constitution and the public law of the Commonwealth in the same way as inter partes private litigation involves a most serious error. It amounts to an abdication of this Court's central constitutional function. The writs referred to in the Constitution are not equitable remedies. Nor are they prerogative privileges. They are 284 But see Ainsworth v Criminal Justice Commission (1990) 175 CLR 564 at 581-582, 285 (1975) 134 CLR 338 at 383. 286 cf Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 367-371 [80]-[89]; cf Kirby constitutional writs to uphold the public law of this nation. I will not be guilty of the error of narrowness or of so inadequate a conception of this Court's remedial purpose and powers. Discretion and relief: Having reached the foregoing conclusions, it is enough to say that there are no discretionary reasons for refusing the identified relief to the plaintiffs. There is every reason for affording such relief. It resolves authoritatively the arguments which the parties and intervener have addressed to the Court in the matter. Its provision upholds the applicable Appropriation Act according to its terms. It conforms to the great design of the Constitution. It respects long-standing constitutional history. It defends the role of the Parliament, and specifically the Senate. It reinforces transparency, honesty and accountability in the expenditure of the money of the Commonwealth, raised from the people. It is conducive to good governance, which is a distinctive policy objective of the Commonwealth and its laws that we proclaim to other countries287. If such public advertising campaigns, as disclosed in these proceedings, are to be permitted in the future, they must, in my view, be expressly approved in an appropriation particularly authorised for that purpose by the representatives in the Parliament who will thereby be rendered accountable to the electors from whom, principally, the taxes are raised, just as the Constitution envisages. Orders Although the Court majority has rejected the plaintiffs' proceedings in terms of the orders announced on 29 September 2005, it follows from these reasons that I disagree. In my opinion, the questions raised in the special case for the opinion of the Full Court should have been answered as proposed by 287 cf Ruhani v Director of Police (2005) 219 ALR 199 at 246 [202] fn 190.

HIGH COURT OF AUSTRALIA APPELLANT AND CEREBOS (AUSTRALIA) LIMITED RESPONDENT Koehler v Cerebos (Australia) Ltd [2005] HCA 15 6 April 2005 ORDER Appeal dismissed with costs. On appeal from the Supreme Court of Western Australia Representation: A G Braddock SC with N J Mullany for the appellant (instructed by Marks & Sands) B W Walker SC with D R Clyne for the respondent (instructed by Dibbs Barker Gosling) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Koehler v Cerebos (Australia) Ltd Negligence – Duty of care – Psychiatric injury – Content of an employer's duty to an employee to take reasonable care to avoid psychiatric injury – Whether employer breached its duty to provide employee with a safe system of work by failing to take the steps identified by employee – Whether reasonable person in position of employer would have foreseen the risk of psychiatric injury to the employee – Relevance of employee's agreement to perform the work which brought about her injuries – Whether the law of negligence should be developed in such a way as to inhibit the making of agreements involving more work than an industry standard. Contract – Contract of employment – Freedom of parties to stipulate that an employee will do more work than an industry standard – Whether the law of negligence should be developed in such a way as to inhibit the making of agreements involving more work than an industry standard. McHUGH, GUMMOW, HAYNE AND HEYDON JJ. The issue The appellant was employed three days a week as a merchandising representative of the respondent (the employer). She could not perform the duties expected of her to her satisfaction. She repeatedly told management that changes had to be made. She said that the work expected of her had to be changed, or she should have more time in which to do it, or she should have help to do it. No changes were made. Five months after starting this work the appellant fell ill. At first a physical disorder was suspected but further consideration revealed that the appellant was suffering a psychiatric illness. Her work was a cause of that illness. Did the employer breach the duty of care it owed the appellant to provide her with a safe system of work? In the District Court of Western Australia, Commissioner Greaves found that the appellant's workload was excessive, that the employer needed no particular expertise to foresee that there was a risk of injury to the appellant of the kind that ensued and that, by not increasing the appellant's hours of work or giving her assistance, the employer failed in its duty to ensure that all reasonable steps were taken to provide the appellant with a safe system of work. On appeal to the Full Court of the Supreme Court of Western Australia (Malcolm CJ, McKechnie and Hasluck JJ) that Court held1 that the employer could not reasonably have foreseen that the appellant was exposed to a risk of psychiatric injury as a consequence of her duties at work. That being so, the employer's appeal was allowed. The appellant now appeals to this Court. The Full Court was right. The appeal should be dismissed. The facts It is desirable to say a little more about the facts. Before taking up the job as a part-time merchandising representative, the appellant had been employed full-time by the employer as a sales representative. 1 Cerebos (Australia) Ltd v Koehler [2003] WASCA 322 at [75]. She worked in that position between November 1994 and April 1996. As a sales representative the appellant negotiated sales of the employer's products to independent supermarkets. She was supported by a merchandiser who would set up the display of the goods in the supermarkets. In March 1996, the employer, having lost the right to distribute an It offered her important range of products, retrenched the appellant. re-engagement as a part-time merchandising representative from 29 April 1996 and she accepted the offer. The letter of engagement set out only the bare bones of her contract of employment. It stated her starting date, and that her working week was Monday to Wednesday (or 24 hours). The letter "confirmed" her salary structure at a particular hourly rate, a car allowance of a stated amount per kilometre and said that "[o]ut of pocket expenses to support incidental expenditure [would] apply". The appellant's letter of engagement said nothing about the duties she was expected to perform. When she reported for work on the first day of her new job (29 April 1996) she was shown a "territory listing". When she saw the stores that were listed she said at once that there was "no way" she could "do this in 24 hours". Her supervisor told her to try it for one month and, if she felt that she could not cope, she should let him know. This she did. It is not necessary to describe the appellant's complaints to management in any detail. It is enough to say that she complained orally and in writing on many occasions that she had too big an area, too many stores and very little time. Her weekly written reports sometimes recorded that she was working more than eight hour days. But all her complaints were directed to whether the work could be done; none suggested that the difficulties she was experiencing were affecting her health. She told management that there were two ways to solve the problems she was encountering: to reduce the number of stores she was to visit, or to have her work a fourth day. She nominated the stores that should be removed from her list and identified the representatives to whom they could be given. The employer took neither of the steps the appellant suggested and took no other action to alter the work expected of the appellant. The appellant did not contend that the employer's failure to take these steps was a breach of an express or implied contractual stipulation regulating the work expected of her. In particular, she did not contend that her exchanges with her supervisors, when first shown a territory listing, gave rise to some relevant term of the employment agreement. She contended that the failure to take the steps she identified was a breach of the employer's common law duty to provide a safe system of work, a breach of an implied term of the employment contract that the employer would provide a safe system of work, and a breach of a statutory duty owed under the Occupational Safety and Health Act 1984 (WA)2. The appellant's work required her to lift cartons of product. On 2 October 1996, she reached the point where she felt she could not physically do that any longer, and she went to see her doctor, complaining of aches and pains and difficulty in moving. She thought that her aches and pains were caused by the physical demands of her job. Her doctor first focused on her physical symptoms. Then she was diagnosed as suffering a "fibromyalgia syndrome", that is, a "psycho-physical disorder resulting in [p]ain [a]mplification". By January 1997, anxiety and depression were thought to be clouding the appellant's clinical picture and she was referred to a psychiatrist. At trial, the Commissioner found that she had developed complex fibromyalgia syndrome and a major depressive illness. Her symptoms were found to be "entirely attributable to her conditions of employment between April and October 1996". Although in issue at trial, it is not now disputed that the appellant sustained and suffers from a recognised psychiatric illness of which her work was a cause. Much attention was given at trial to the amount of work expected of the appellant. Comparisons were made between the work she had done when employed full-time, and the work expected of her when employed part-time. No doubt such comparisons were made because the appellant's complaints to her supervisors, and to her doctors, had often been put in terms that she was expected to do the same amount of work in three days as she had previously been doing in five. The Commissioner accepted the evidence given by persons familiar with work of the kind undertaken by the appellant in connection with supplying products to supermarkets to the effect that the appellant's workload "was too much to maintain in three days" and that her workload "was very similar to that of a full-time employee". It was on the basis of this evidence that the Commissioner found that the appellant's workload between 29 April 1996 and 2 The Act was referred to in the appellant's Statement of Claim by its former title, the Occupational Health, Safety and Welfare Act 1984 (WA). The title was changed by the Occupational Safety and Health Legislation Amendment Act 1995 (WA) (Act No 30 of 1995). 2 October 1996 was "excessive". Having made the finding about foreseeability noted earlier (that with its knowledge of the industry and the particular workload of the appellant the employer required no particular expertise to foresee a risk of injury to the appellant), the Commissioner found that it had been open to the employer to increase the appellant's hours or provide her with assistance. The Commissioner described the expense, difficulty, and inconvenience of such a course of action as "negligible"3. Judgment was entered for the appellant. As noted earlier, the Full Court focused its attention upon the correctness of the Commissioner's finding about foreseeability. Justice Hasluck (with whom the other members of the Court agreed) said4 that: "in the absence of external signs of distress or potential injury a reasonable person in the position of the [employer] could not have foreseen that the [appellant] was exposed to a risk of injury as a consequence of her duties as a merchandiser. The presence of complaints about the workload may have suggested to a reasonable employer that remedial action was required in order to avert an industrial dispute but on the evidence in this case the nature of the complaints was not enough to alert a reasonable employer to the possibility of injury." That is, the question of foreseeability was treated in the Full Court as determinative, and as turning (at least in this case) upon whether there was any material available to the employer that should have alerted it to a specific risk of psychiatric injury to the appellant. In this Court, the employer submitted that the Full Court was right to reach the conclusion which it did on this aspect of the matter but sought to go the further step of submitting that there had been no evidence before the Commissioner to support the conclusion that it required no particular expertise to foresee the risk of psychiatric injury. It will be necessary to return to this question. Before doing that, however, it is necessary to identify the proper point at which to begin consideration of the issues which arise when it is claimed, as in this case, that an employer's duty of care obliges the employer to avoid a risk of psychiatric injury to an employee by altering the work expected of the employee. cf Wyong Shire Council v Shirt (1980) 146 CLR 40 at 47-48 per Mason J. [2003] WASCA 322 at [75]. The proper starting point Because the appellant's claim was framed in negligence, and because her claim was brought against her employer, it may be thought necessary to have regard only to the well-established proposition that an employer owes an employee a duty to take all reasonable steps to provide a safe system of work. From there it may be thought appropriate to proceed by discarding any asserted distinction between psychiatric and physical injury, and then focus only upon questions of breach of duty. Questions of breach of duty require examination of the foreseeability of the risk of injury and the reasonable response to that risk in the manner described in Wyong Shire Council v Shirt5. But to begin the inquiry by focusing only upon questions of breach of duty invites error. It invites error because the assumption that is made about the content of the duty of care may fail to take fundamental aspects of the relationship between the parties into account. These reasons later show that this case may be decided, as it was by the Full Court, at the level of breach of duty, on the basis that the risk of psychiatric injury to the appellant was not reasonably foreseeable. It is, however, important to point out the nature of at least some of the issues that arise in connection with the content of an employer's duty of care. The content of an employer's duty of care The content of the duty which an employer owes an employee to take reasonable care to avoid psychiatric injury cannot be considered without taking account of the obligations which the parties owe one another under the contract of employment, the obligations arising from that relationship which equity would enforce and, of course, any applicable statutory provisions. (This last class may require particular reference not only to industrial instruments but also to statutes of general application such as anti-discrimination legislation.) Consideration of those obligations will reveal a number of questions that bear upon whether, as was the appellant's case here, an employer's duty of care to take reasonable care to avoid psychiatric injury requires the employer to modify the work to be performed by an employee. At least the following questions are raised by the contention that an employer's duty may require the employer to modify the employee's work. Is an employer bound to engage additional workers to help a distressed employee? If a contract of employment stipulates the work which an employee is to be paid to do, may the employee's pay be reduced if the (1980) 146 CLR 40 at 47-48. employee's work is reduced in order to avoid the risk of psychiatric injury? What is the employer to do if the employee does not wish to vary the contract of employment? Do different questions arise in cases where an employee's duties are fixed in a contract of employment from those that arise where an employee's duties can be varied by mutual agreement or at the will of the employer? If an employee is known to be at risk of psychiatric injury, may the employer dismiss the employee rather than continue to run that risk? Would dismissing the employee contravene general anti-discrimination legislation? No doubt other questions may arise. It is, however, neither necessary nor appropriate to attempt to identify all of the questions that could arise or to attempt to provide universal answers to them. What is important is that questions of the content of the duty of care, and what satisfaction of that duty may require, are not to be examined without considering the other obligations which exist between the parties. A deal of reference was made in argument to the decision of the English Court of Appeal in the several appeals heard together and reported as Hatton v Sutherland6. The appellant submitted that, consistent with what was said in Hatton, this Court should hold that where an employee claims damages from an employer for negligently inflicted psychiatric injury, only one question need be considered, namely, whether this kind of harm to this particular employee was reasonably foreseeable7. That proposition should be rejected. No doubt, as was pointed out in Hatton8, there will be a number of factors which are likely to be relevant to answering the particular question identified in that case. Those factors would include both the nature and extent of the work being done by the employee9, and the signs from the employee concerned10 – whether in the form of express warnings or the implicit warning that may come from frequent or prolonged absences that are uncharacteristic11. What other [2002] 2 All ER 1. [2002] 2 All ER 1 at 13 [23]. [2002] 2 All ER 1 at 14 [25]. [2002] 2 All ER 1 at 14 [26]. 10 [2002] 2 All ER 1 at 14 [27]. 11 [2002] 2 All ER 1 at 14 [28]. reasonably matters might make the risk of psychiatric injury reasonably foreseeable was a question not explored in argument. It is a question that may require much deeper knowledge of the causes of psychiatric injury than whatever may be identified as common general knowledge. But neither the particular issues identified in Hatton nor the question from which they stem (was this kind of harm to this particular employee treated as a comprehensive statement of relevant and applicable considerations. As Lord Rodger of Earlsferry pointed out in his speech in the House of Lords in the appeal in one of the cases considered in Hatton v Sutherland, Barber v Somerset County Council12, it is only when the contractual position between the parties (including the implied duty of trust and confidence between them) "is explored fully along with the relevant statutory framework" that it would be possible to give appropriate content to the duty of reasonable care upon which an employee claiming damages for negligent infliction of psychiatric injury at work would seek to rely. foreseeable?) should be Issues about the content of the duty of care were not examined in any detail in the courts below. It was assumed that the relevant duty of care was sufficiently stated as a duty to take all reasonable steps to provide a safe system of work without examining what limits there might be on the kinds of steps required of an employer. Rather, attention was directed only to questions of breach of duty framed without any limitations that might flow from an examination of the content of the duty of care. As earlier indicated, the question of reasonable foreseeability is determinative. The present case The Full Court was right to conclude that a reasonable person in the position of the employer would not have foreseen the risk of psychiatric injury to the appellant. Because the appellant did not prove that the employer ought reasonably to have foreseen that she was at risk of suffering psychiatric injury as a result of performing her duties at work, her claim in negligence should have failed at trial. The appellant's alternative claims, in breach of contract and breach of statutory duty, have been treated at all stages of this litigation as raising no different issues from those raised by her claim in negligence. As is implicit in what has already been said about determining the content of the employer's duty of care, consideration of a claim in contract (founded on the breach of an implied term requiring reasonable care) would invite close attention to the other terms of the contract of employment, as well as the relevant statutory framework. The 12 [2004] 1 WLR 1089 at 1101 [35]; [2004] 2 All ER 385 at 398. claims in contract and breach of statutory duty having been treated as they were both in the courts below and in this Court, it is unnecessary to consider them further in these reasons. There are two reasons why the Full Court was right to reach the conclusion it did. First, the appellant agreed to perform the duties which were a cause of her injury. Secondly, the employer had no reason to suspect that the appellant was at risk of psychiatric injury. It is sufficient for the purposes of the present case to attribute only limited significance to the appellant's agreement to perform the duties which brought about her injuries. In this case it is enough to notice that her agreement to undertake the work runs contrary to the contention that the employer ought reasonably to have appreciated that the performance of those tasks posed a risk to the appellant's psychiatric health. It runs contrary to that contention because agreement to undertake the work not only evinced a willingness to try but also was not consistent with harbouring, let alone expressing, a fear of danger to health. That is why the protests the appellant made (that performance of the work within the time available seemed impossible) did not at the time bear the significance which hindsight may now attribute to them. What was said did not convey at that time any reason to suspect the possibility of future psychiatric injury. Although, in this case, the agreement to perform the work has only the limited significance we have indicated, that is not to say that, in another case, an employee's agreement to perform duties whose performance is later found to be a cause of psychiatric injury may not have greater significance. An employer may not be liable for psychiatric injury to an employee brought about by the employee's performance of the duties originally stipulated in the contract of employment. In such a case, notions of "overwork", "excessive work", or the like, have meaning only if they appeal to some external standard. (The industry evidence adduced by the appellant was, no doubt, intended to provide the basis for such a comparison and, as noted earlier, the Commissioner drew a comparison of that kind by concluding that the appellant's workload was excessive.) Yet the parties have made a contract of employment that, by hypothesis, departs from that standard. Insistence upon performance of a contract cannot be in breach of a duty of care. At first sight, it may appear to be easy to read an employee's obligations under a contract, and an employer's rights to performance of those obligations, as subject to some qualification to the effect that performance of the obligations is excused if performance would be beyond what is required by some external standard, or is or may be injurious to health, or both injurious and beyond an external standard. But further examination of the problem reveals that there are difficulties in resolving the issue in this way. Giving content to what we have called an "external standard" by which work requirements would be judged may not be easy. Presumably, it would be some form of industry standard. Assuming, however, that content can be given to that concept, its application would invite attention to fundamental questions of legal coherence13. Within the bounds set by applicable statutory regulation, parties are free to contract as they choose about the work one will do for the other. In particular, within those bounds, parties are free to stipulate that an employee will do more work than may be the industry standard amount. Often the agreement to do that will attract greater rewards than the industry standard. Developing the common law of negligence in a way that inhibited the making of such agreements would be a large step to take. Adopting a qualification that hinges upon whether psychiatric injury is or may be sustained from performance of the work would require consideration of questions that are closely related to issues of foreseeability and it is convenient to turn to those issues. In Tame v New South Wales; Annetts v Australian Stations Pty Ltd14, the Court held that "normal fortitude" was not a precondition to liability for negligently inflicting psychiatric injury. That concept is not now to be reintroduced into the field of liability as between employer and employee. The central inquiry remains whether, in all the circumstances, the risk of a plaintiff (in this case the appellant) sustaining a recognisable psychiatric illness was reasonably foreseeable, in the sense that the risk was not far fetched or fanciful15. It may be right to say that it is now a matter of general knowledge that some recognisable psychiatric illnesses may be triggered by stress. It is, however, a further and much larger step to take to say that all employers must now recognise that all employees are at risk of psychiatric injury from stress at work. Yet it is that proposition, or one very like it, which must lie behind the 13 Sullivan v Moody (2001) 207 CLR 562 at 580-581 [54]-[55]. 14 (2002) 211 CLR 317. See also Gifford v Strang Patrick Stevedoring Pty Ltd (2003) 214 CLR 269. 15 Tame v New South Wales; Annetts v Australian Stations Pty Ltd (2002) 211 CLR Commissioner's conclusion that it required no particular expertise to foresee the risk of psychiatric injury to the appellant. The duty which an employer owes is owed to each employee. The relevant duty of care is engaged if psychiatric injury to the particular employee is reasonably foreseeable. That is why, in Hatton16, the relevant question was rightly found to be whether this kind of harm to this particular employee was reasonably foreseeable. And, as pointed out in that case, that invites attention to the nature and extent of the work being done by the particular employee17 and signs given by the employee concerned18. Because the inquiry about reasonable foreseeability takes the form it does, seeking to read an employer's obligations under a contract as subject to a qualification which would excuse performance, if performance is or may be injurious to psychiatric health, encounters two difficulties. First, the employer engaging an employee to perform stated duties is entitled to assume, in the absence of evident signs warning of the possibility of psychiatric injury, that the employee considers that he or she is able to do the job. Implying some qualification upon what otherwise is expressly stipulated by the contract would contradict basic principle19. Secondly, seeking to qualify the operation of the contract as a result of information the employer later acquires about the vulnerability of the employee to psychiatric harm would be no less contradictory of basic principle. The obligations of the parties are fixed at the time of the contract unless and until they are varied. Two caveats should be entered. First, hitherto we have referred only to the employer's performance of duties originally stipulated in a contract of employment. It may be that different considerations could be said to intrude when an employer is entitled to vary the duties to be performed by an employee and does so. The exercise of powers under a contract of employment may more readily be understood as subject to a qualification on their exercise than would 16 [2002] 2 All ER 1 at 13 [23]. 17 [2002] 2 All ER 1 at 14 [26]. 18 [2002] 2 All ER 1 at 14 [27]. 19 Codelfa Construction Pty Ltd v State Rail Authority of New South Wales (1982) 149 CLR 337 at 347; BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266 at 283. the insistence upon performance of the work for which the parties stipulated when making the contract of employment. Secondly, we are not to be understood as foreclosing questions about construction of the contract of employment. Identifying the duties to be performed under a contract of employment and, in particular, identifying whether performance of those duties is subject to some implied qualification or limitation, necessarily requires that full exploration of the contractual position of which Lord Rodger spoke in Barber v Somerset County Council, against the relevant statutory framework in which the contract was made. In this case, it is not necessary to consider any issue that might be presented by variation of the duties for which parties originally stipulate in a contract of employment because, in this case, there was not said to have been any variation of the appellant's duties. The evidence revealed that the appellant was a very conscientious employee. She may well have done more than her contract of employment required of her but the employer did not vary her duties from those originally stipulated when she was re-engaged as a part-time merchandising representative. And, as the appellant's complaints to her employer revealed, it was the performance of those duties which she found to be more than she could cope with. Nor is it necessary to decide this case on the basis that the appellant's agreement to perform the duties which were a cause of her injuries is conclusive against her claim. The identification of the duties for which the parties stipulated would require much closer attention to the content of the contractual relationship between them than was given in the evidence and argument in the courts below. For present purposes, it is sufficient to notice that her agreement to undertake the tasks stipulated (hesitant as that agreement was) runs contrary to the contention that the employer ought reasonably to have appreciated that the performance of those tasks posed risks to the appellant's psychiatric health. The conclusion that the employer had no reason to suspect that the appellant was at risk of psychiatric injury is the reason upon which the Full Court's conclusion hinged. Here there was no indication (explicit or implicit) of any particular vulnerability of the appellant. As noted earlier, she made many complaints to her superiors but none of them suggested (either expressly or impliedly) that her attempts to perform the duties required of her were putting, or would put, her health at risk. She did not suggest at any time that she was vulnerable to psychiatric injury or that the work was putting her at risk of such an injury. None of her many complaints suggested such a possibility. As the Full Court said, her complaints may have been understood as suggesting an industrial relations problem. They did not suggest danger to her psychiatric health. When she did go off sick, she (and her doctor) thought that the illness was physical, not psychiatric. There was, therefore, in these circumstances, no reason for the employer to suspect risk to the appellant's psychiatric health. The Full Court was right to conclude that the employer was not shown to have breached a duty of care. The appeal to this Court should be dismissed with costs. Callinan CALLINAN J. Is an employee, who finds the workload of a position that she has voluntarily accepted excessive to the point that she suffers a disabling psychiatric illness, entitled to recover damages for negligence from her employer? In particular, is the occurrence of such an illness without more, foreseeable? These are the questions to which this appeal gives rise. The facts The appellant who was then 40 years old and in good health began to work full time for the respondent in November 1994 as a sales representative. She was the most successful of the respondent's sales representatives during the year 1995. In March 1996 the respondent told her that she was to be retrenched. She was however offered another position as a part-time merchandiser working three days per week. It was also intimated to the appellant that she would be restored to a full-time position within about 6 months . The terms upon which the part-time employment was offered and which she accepted were reduced to writing on 4 April 1996: "Employment conditions. Officially commence merchandising services from April 29th next. B) Working week will consist of Monday, Tuesday & Wednesday (24 hours). Salary structure is confirmed at $14.00 per hour. Car allowance of 47c per km. Out of pocket expenses to support incidental expenditure will apply and authorised by [the Manager]." She continued to work in her full-time position until late April 1996. When her superior outlined her new part-time duties to her, she claimed that she immediately informed him that she could not do the work within the time allotted of 3 working days, and that it involved the lifting of cartons that were too heavy for her. She claimed that she subsequently repeated her complaints to several others of the respondent's staff. Two of the complaints were specific, very detailed, and in writing. The appellant said that by early October 1996, she could no longer do the work. After a time she made these assertions to the respondent. Mentally she was not the same. She was troubled by aches and pains. Her memory was deteriorating. She found it difficult to sleep. She was exhausted. It seemed to her that her ability to comprehend was reduced. She had become emotional. Her libido was markedly diminished. She consulted a doctor, Dr Hendry, and ceased to work in early October 1996. Initially the doctor's focus, as was her own, was Callinan upon her physical symptoms. Only later was the doctor to form the view that the appellant was stressed and depressed. He referred her first to a rheumatologist, Dr Hayes, who, on 11 December 1996 made this diagnosis of her condition: "... I believe this lady's symptoms are multifactorial, ie she demonstrates features of Depression combined with a CHRONIC PAIN SYNDROME consistent with Fibromyalgia Syndrome. The alleged pressure of her work appears to be the precipitating factor in the onset of this lady's symptoms, hence I have referred to this as being a 'work-related Fibromyalgia Syndrome'. in Pain Amplification Fibromyalgia Syndrome is thought to be a psycho-physical disorder resulting developing this type of condition. Hence the patient's psychological makeup in the first place is of significant importance in the development of this condition which in turn has been precipitated by the stress of her work." in certain people predisposed In April 1997, Professor Burvill a consulting psychiatrist to whom Dr Hayes referred the appellant, diagnosed her as suffering a moderately severe, major depressive illness. He thought that there was a very clear association between her work and her depression. Soon afterwards, following a sighting for the first time of Dr Hayes's reports upon her, he formed the opinion that the symptoms of fibromyalgia and major depression were not directly related to her termination and reappointment in March and April 1996, but that they were related to her conditions of work. Professor Burvill saw the appellant many times over the ensuing years. She was, he thought, effectively unemployable. The trial In due course the appellant brought proceedings in the District Court of Western Australia. Her claim in substance was that the respondent so unreasonably overloaded her with work, that is to say, negligently so, that she became stressed to the point that she suffered a severe depressive injury disabling her from working. The particulars of negligence alleged were as follows: failed to properly train the [appellant] in the performance of her duties; failed to properly supervise the [appellant] in the performance of her duties; failed to attend with the [appellant] on her round of duties to ascertain where adjustments could be made to assist her health and safety; Callinan failed to heed the concerns of the [appellant] regarding assistance, health and safety; failed to provide the [appellant] with suitable lifting devices; failed to tutor the [appellant] in suitable lifting techniques and to enforce these techniques; failed to provide for the [appellant], suitable assistance either mechanical or human to be able to mount her displays especially when requested by the [appellant]; failed to not place unrealistic demands on the [appellant] to perform the role of both Merchandiser and Sales Representative when other employees of the defendant were not required to perform both roles; failed to respect and not abuse the [appellant's] conscientious nature; and failed to not place the [appellant] under psychological and physical stress and pressure." It was part of the appellant's case that the respondent knew or must have known of the risk of psychological injury to her because of her repeated requests for relief, assistance and a reduction in her workload. The appellant also sought to mount a case of breach of contract and breach of s 19(1) of the Occupational Safety and Health Act 198420 (WA) ("the Act") which provides as follows: "19. Duties of employers (1) An employer shall, so far as is practicable, provide and maintain a working environment in which his employees are not exposed to hazards and in particular, but without limiting the generality of the foregoing, an employer shall – provide and maintain workplaces, plant, and systems of work such that, so far as is practicable, his employees are not exposed to hazards; 20 Prior to the enactment of the Occupational Safety and Health Legislation Amendment Act 1995 (WA) the Act was entitled the Occupational Health, Safety and Welfare Act 1984 (WA). Callinan provide such information, instruction, and training to, and supervision of, his employees as is necessary to enable them to perform their work in such a manner that they are not exposed to hazards; and consult co-operate with health if any, and other employees at his representatives, workplace, regarding occupational safety and health at the workplace; safety and (d) where it is not practicable to avoid the presence of hazards at the workplace, provide his employees with, or otherwise provide for his employees to have, such adequate personal protective clothing and equipment as is practicable to protect them against those hazards, without any cost to the employees; and (e) make arrangements for ensuring, so far as is practicable, that – the use, cleaning, maintenance, transportation and disposal of plant; and the use, handling, processing, storage, transportation and disposal of substances, at the workplace is carried out in a manner such that his employees are not exposed to hazards." The only arguable allegation in respect of the claim in contract was that the respondent failed to provide the appellant with a safe system of work, that is, one which did not make unrealistic demands upon her. The appellant did not suggest however, either at the trial, or on the appeal to the Full Court of the Supreme Court of Western Australia that the principles applicable to each of the claims were in any way different in this case, although, as will appear, contractual considerations should not be disregarded. Evidence on behalf of the appellant was received at the trial from persons professing expertise in occupational health and related disciplines. The burden of this evidence was that relevant training should be given to staff and they should not be asked to do what it was beyond their capacities to do. The witnesses were unable to say however that the appellant's duties exceeded what was reasonable and that they caused her disabilities. The appellant's action was tried by Commissioner Greaves. He concluded that the respondent did not need to possess any particular expertise to appreciate and foresee that if it did not review its operations and the appellant's workload, Callinan there would be a risk of injury to her of the kind that she suffered, even though some might think the risk an unlikely one. It was, nonetheless, not a far-fetched or fanciful one: it was, in summary, real and foreseeable, and the respondent as an employer should have foreseen it. It was his opinion that having regard to the magnitude of the risk, the degree of probability of its occurrence and the expense, difficulty and inconvenience of taking alleviating action, and any other conflicting responsibilities which the respondent may have had, a reasonable person in the position of the respondent faced with the appellant's complaints would have investigated and evaluated them, and made such changes to the system of work as the circumstances required. He rejected the respondent's contention that the appellant caused or contributed to her disabilities by her own negligence or any breach of contract on her part. (The respondent had alleged that the appellant had failed to exercise care for her own well-being in breach of an implied term of her contract of employment requiring her to do so). The Commissioner then assessed damages and gave judgment in favour of the appellant in the sum of $856,742.81. The appeal to the Full Court of the Supreme Court of Western Australia The respondent's appeal to the Full Court of the Supreme Court of Western Australia was heard by Malcolm CJ, McKechnie and Hasluck JJ. The only grounds of appeal argued were those relating to negligence. No contention was advanced there which required any decision on the claim for breach of statutory duty or breach of contract. Hasluck J, with whom the other members of the Court agreed, was of the opinion that the respondent's appeal should be allowed on three grounds. First, his Honour was of the view that in the absence of external signs of distress or potential injury, a reasonable person in the position of the respondent could not have foreseen that the appellant would have been exposed to any risk of injury by reason of the performance of her duties as a part-time merchandiser. Complaints made by the appellant might have alerted a responsible employer to the need to take remedial steps to avert an industrial problem, but not to take measures to prevent the development of a psychiatric illness. Secondly, in the absence of changes in the appellant's demeanour, personality and behaviour, and of complaints of actual symptoms or illness by her, it was not reasonably foreseeable that the appellant would suffer an illness. Thirdly, in the absence of any evidence of psychiatric vulnerability, there was no basis for a finding of a foreseeable risk of a psychiatric injury. His Honour was influenced in reaching his decision by the reasoning of the English Court of Appeal in Hatton v Sutherland21 in which Hale LJ delivered the judgment of the Court. The principles stated by her Ladyship there were subsequently adopted as principles to be generally applied in cases of psychiatric 21 [2002] 2 All ER 1. Callinan injury caused by stress in the workplace by the House of Lords in Barber v Somerset County Council22. The appeal to this Court In my opinion the appeal to this Court must fail for these reasons. The appellant has not shown the respondent to have been negligent. The respondent undoubtedly owed the appellant a duty to take reasonable care for her safety in doing her work. But that duty did not oblige the respondent to reduce the amount of part-time work that it was prepared to offer to the appellant, or to dismiss her. These were the only measures that could have prevented the appellant from becoming stressed to the point that she became psychiatrically injured, assuming, as does seem to be the case, that her concerns about, or the actual amount of work that she was doing were causative of such an injury. Three Justices of this Court in Wyong Shire Council v Shirt23 held that any risk, however remote or even extremely unlikely its realization may be, that is not far-fetched or fanciful, is foreseeable24. I suppose that it is true that there is nothing new under the sun. With enough imagination and pessimism it is possible to foresee that practically any misadventure, from mishap to catastrophe is just around the corner. After all, Malthus in 1798 famously predicted that the population of the world would inevitably outstrip the capacity of the Earth to sustain it. The line between a risk that is remote or extremely unlikely to be realized, and one that is far-fetched or fanciful is a very difficult one to draw. The propounding of the rule relating to foreseeability in the terms that their Honours did in Wyong requires everyone to be a Jeremiah25, and has produced the result that undue emphasis has come to be placed upon the next element for the establishment of tortious liability, the sorts of measures that a reasonable person should be expected or required to take to guard against the risk. Wyong has however been constantly applied throughout this country and in this Court since it was decided, and neither party sought to challenge it here. I am therefore bound to apply it. Even on the application of it however, the appellant must fail at the threshold, that is on the issue of foreseeability. In my opinion, it was far-fetched 22 [2004] 1 WLR 1089; [2004] 2 All ER 385. 23 (1980) 146 CLR 40. 24 (1980) 146 CLR 40 at 47 per Mason J, Stephen and Aickin JJ agreeing. 25 The Judean prophet of doom circa 646 BC to about 580 BC, Old Testament, Ch 24. Callinan and not foreseeable that the appellant, a competent, seemingly well woman26 would suffer within six months of taking up a part-time position, a disabling psychiatric injury, or indeed, any psychiatric injury by reason of the work that the position entailed. As I pointed out in Tame v State of New South Wales27 psychiatric illness or injury is in some important respects a different kind of illness or injury than physical injury. The difference is one of the reasons why its development is less readily foreseeable than traumatically caused injury. That is not to say of course that it is a condition of liability that a particular kind of psychiatric injury must be foreseeable. And, as the majority of the judgments in Tame28 also make clear, foreseeability is not to be assessed by reference to a notional person of normal fortitude, but on the basis of the impression created by, and the other overt or foreseeable sensitivities of the actual person affected. The fact however that a psychiatrist placed in the same position as an employer might have foreseen a risk of psychiatric injury, does not mean that a reasonable employer should be regarded as likely to form the same view. It is significant in this case that several witnesses in a position to observe the appellant on a regular basis discerned no changes in her personality, or symptoms of any kind before she became ill. And neither she nor the doctor she first consulted, believed that she was suffering a psychiatric illness. The latter did not contemplate the possibility of a need for a psychiatrist's assessment for some time, and the appellant herself was similarly unaware that she needed the assistance of a psychiatrist. That is sufficient to dispose of the appeal, conducted as it was, as raising issues in tort only. In the context of the workplace however, when the claim is of an excessive workload as the cause of injury, the rights and liabilities of the parties (subject only to relevant industrial legislation, if any, and to none of which the Court was referred here) will usually be governed by the contract of employment. I doubt whether any term could have been implied in the contract, consisting as it did, of the letter of engagement only, that imposed upon the respondent a duty not to ask, or require the appellant to do the amount of work that she herself agreed to do. If asked to do more, or if what she agreed to do was more than she could do, then it was for her either to refuse to do it at all, or to relinquish her position. Every responsible position makes its demands upon 26 One doctor, Dr Hendry, described the appellant's demeanour as "highly competent and efficient". 27 (2002) 211 CLR 317 at 420 [308]. 28 (2002) 211 CLR 317 at 333 [16] per Gleeson CJ, 384 [199] per Gummow and Callinan the person occupying it. As Lord Scott of Foscote succinctly put it in his dissenting speech in Barber v Somerset County Council29: "Pressure and stress are part of the system of work under which [people] carry out their daily duties. But they are all adults. They choose their profession. They can, and sometimes do, complain about it to their employers." That industrial legislation might alter the rights and obligations of the parties in those circumstances, has nothing to say about foreseeability of risk, or the appellant's claim for damages for personal injury. The approach adopted by the Full Court in this appeal was in accordance with the principle stated in Fox v Percy30. In doing so their Honours made no errors. The appeal should be dismissed with costs. 29 [2004] 1 WLR 1089 at 1095 [14]; [2004] 2 All ER 385 at 392. 30 (2003) 214 CLR 118; cf Lord Scott of Foscote in Barber v Somerset County Council [2004] 1 WLR 1089 at 1093-1094 [11]-[12]; [2004] 2 All ER 385 at 390-

HIGH COURT OF AUSTRALIA GUMMOW ACJ Matters No S141/2008 & S142/2008 APPELLANT AND THE QUEEN Matters No S327/2007 & S328/2007 RESPONDENT APPLICANT AND THE QUEEN RESPONDENT [2008] HCA 34 31 July 2008 S141/2008 & S142/2008, S327/2007 & S328/2007 ORDER Dismiss so much of the appellant's applications for special leave to appeal to this Court on grounds other than those upon which the appeals to this Court are founded. Appeals allowed. Set aside the order of the Court of Criminal Appeal made on 23 March 2007. Set aside the order of the Court of Criminal Appeal made on 16 March 2007. Remit the appellant's appeal against conviction and his application for leave to appeal against sentence to the Court of Criminal Appeal for rehearing. On appeal from the Supreme Court of New South Wales Representation I M Barker QC with D G Dalton SC for the appellant/applicant (instructed by Legal Aid Commission of NSW) M G Sexton SC, Solicitor-General for the State of New South Wales with T L Smith for the respondent (instructed by Solicitor for Public Prosecutions (NSW)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Criminal law – Appeal and new trial – Orders dismissing appeals formally recorded – Reasons for judgment contained substantial factual errors – Whether superior court of record can reopen proceedings after its orders disposing appeals formally recorded – Whether power to reopen appeals – Finality of litigation – Procedural fairness. Criminal Practice – Court of Criminal Appeal (NSW) – Appeal – Power to reopen proceedings after orders disposing of appeals formally recorded – Finality of litigation – Avoidance of injustice to parties – Procedural fairness. Courts – Court of Criminal Appeal (NSW) – Appeal – Reasons for judgment contained substantial factual errors – Power to reopen proceedings after orders disposing appeals formally recorded – Relevance of status and general powers of Court – Whether implied or inherent powers to avoid injustice to parties suffice to sustain orders reopening proceedings. Words and phrases – "finality", "perfecting", "procedural fairness", "reopen", "superior court of record". Criminal Appeal Act 1912 (NSW), ss 3-23. Criminal Appeal Rules 1952 (NSW), rr 51, 53. GUMMOW ACJ, HAYNE, HEYDON, CRENNAN AND KIEFEL JJ. The Court of Criminal Appeal of New South Wales published reasons for decision and pronounced orders dismissing the appellant's appeals against conviction and sentence. After those orders had been formally recorded, the Court discovered that its reasons contained substantial factual errors. Could the Court reopen the appeals and reconsider the orders that had passed into record? The appellant submitted, on appeal to this Court, that the Court of Criminal Appeal had no power to reopen the appeals. He submitted that this Court should set aside the orders first made by the Court of Criminal Appeal on account of the errors the Court of Criminal Appeal made. He further submitted that this Court should set aside the second orders of the Court of Criminal Appeal, confirming its first orders, on the ground that the second orders were made without jurisdiction. The appellant further submitted that his appeals to the Court of Criminal Appeal should be remitted to that Court for rehearing. Those submissions should be accepted and orders made accordingly. Proceedings below In 2006 the appellant was tried in the Supreme Court of New South Wales, before Barr J and a jury, on an indictment charging that on 6 May 1997 he detained Kerry Patricia Whelan with intent to hold her for advantage, and that on or about the same day he murdered Mrs Whelan. The jury returned verdicts of guilty to both counts on 6 June 2006. The appellant was sentenced to life imprisonment on the count of murder and to 16 years' imprisonment, with a non-parole period of 12 years, on the count of kidnapping. The appellant appealed against his convictions, and sought leave to appeal against the sentences imposed, to the Court of Criminal Appeal. On 16 March 2007, that Court (McClellan CJ at CL, Sully and James JJ) published1 reasons for its decision to dismiss the appeal against convictions, grant leave to appeal against sentence, but dismiss that appeal. Orders to that effect were pronounced by the Court. That same day, 16 March 2007, notification of the Court's determination of what was described in the notice as "the application of Bruce Burrell to appeal against conviction and sentence" was prepared in the Registry of the Court of Criminal Appeal, signed on behalf of the Registrar of that Court and stamped 1 Burrell v The Queen [2007] NSWCCA 65. Gummow ACJ Hayne Crennan with the Court's seal. The notification was required by r 51 of the Criminal Appeal Rules 1952 (NSW). That rule then provided: "The Registrar shall send a notice (Forms Nos XI and XII) of the determination of any appeal, or of any application incidental thereto, to the appellant, if he was not present when the matter was determined, to the proper officer of the Court of Trial, to the Director-General of Corrective Services and to the Sheriff, if the appeal is against a conviction involving a sentence of death or is against a sentence of death." It is common ground that on the same day, 16 March 2007, particulars of the Registrar's notification were entered on the records of the Supreme Court of New South Wales as the court of trial. That step was required by r 53 of the Criminal Appeal Rules which then provided: "(1) Such proper officer shall thereupon enter the particulars of such notification on the records of the Court of Trial. Such entry shall be made in conformity with the administration of the Court of Trial on: the indictment, the appropriate Court file, or the appropriate computer record." There is no dispute that these steps, or some of them, constituted the formal recording of the orders of the Court of Criminal Appeal that had been pronounced orally. It is not necessary to decide whether both steps were essential to the formal recording of the order or, as has been held2 by the Court of Criminal Appeal, only the steps required by r 53. On the next business day, 19 March 2007, the matter was again called on by the Court of Criminal Appeal. At the request of the Court, counsel for the parties attended. McClellan CJ at CL, who had given the reasons of the Court of Criminal Appeal that had been published on the previous Friday, 16 March 2007, said that it had been brought to the attention of his Honour's associate "this morning [19 March 2007] that the judgment, which I prepared and the other 2 R v Reardon (No 2) (2004) 60 NSWLR 454. Gummow ACJ Hayne Crennan members of the Court joined in, when recounting the Crown case has some inaccuracies". McClellan CJ at CL said that: "[the] inaccuracies are there because in preparing the document I drew upon a document prepared by the appellant headed '[f]acts alleged in the Crown case'. That document came to the judges as part of the appellant's submissions. It would seem I mistakenly assumed that was an accurate document. It turns out it is not." The Court asked counsel how it should set out correcting the error that had been made. Counsel then appearing for the respondent submitted that the error could not be corrected. The matter was stood over for further argument on 21 March 2007. That further argument proceeded on the footing that the prosecution had sought to reopen the appeals, but as the description of events that has been given shows, the initiative for reconsideration came from the Court of Criminal Appeal, not either of the parties. Neither in the further argument of the matter in the Court of Criminal Appeal nor subsequently has there been any dispute between the parties that, as the Court of Criminal Appeal was later to state in its second set of reasons3, "the understanding which the Court had of evidence at the trial was in some respects not correct". The present appellant submitted to the Court of Criminal Appeal that that Court had no power to reopen the appeals and further submitted that the Court of Criminal Appeal, as then constituted, should not redetermine the matter because there would be a reasonable apprehension in the ordinary fair-minded person that the Court as then constituted may be biased. In its reasons delivered on 23 March 2007, the Court of Criminal Appeal rejected both submissions. The Court of Criminal Appeal held4 that the Court had power to reopen the appeals. In particular, the Court of Criminal Appeal concluded5 that: "In this case the appeal has been determined and reasons published upon a false understanding as to some matters. The appeal has not been 3 R v Burrell [2007] NSWCCA 79 at [2]. [2007] NSWCCA 79 at [39]. [2007] NSWCCA 79 at [41]. Gummow ACJ Hayne Crennan determined in relation to the relevant evidence. For that reason it has not been finally determined." The Court reconsidered the conclusions it had earlier expressed having regard to the identified factual errors that had been made in its first reasons for judgment, and ordered that the orders of the Court dismissing the appeals should be "confirmed". Appeal to this Court By special leave, the appellant now appeals to this Court against the first orders of the Court of Criminal Appeal made on 16 March 2007 and the second orders made on 23 March 2007. The central issue in this Court is whether the Court of Criminal Appeal had power to reopen the appeals after orders disposing of them had been formally recorded. Against the possibility that remitter to the Court of Criminal Appeal, for rehearing of the appeals by that Court, may not be thought appropriate, the appellant sought special leave to appeal on grounds alleging, in effect, that the Court of Criminal Appeal should have found errors in the proceedings at trial. In so far as the application for special leave raised those matters, it was referred for consideration by the Full Court of this Court that would hear and determine the appeals. The matters giving rise to these additional grounds should be dealt with afresh on the rehearing of the matter in the Court of Criminal Appeal. So much of the appellant's applications for special leave to appeal to this Court on grounds other than those upon which the appeals to this Court are founded should be dismissed. As is implicit in what has been said, however, that dismissal is not to be understood as expressing any view about the merits of those other issues. Some basic considerations The question that arises in this appeal concerns the powers of a superior court of record6 to reopen a proceeding and reconsider the orders that have been made. The position of courts other than superior courts of record need not be examined and what is said in the balance of these reasons considers only the orders of a superior court of record. 6 See as to "superior court of record": DMW v CGW (1982) 151 CLR 491 at 503-505; [1982] HCA 73; Re Macks; Ex parte Saint (2000) 204 CLR 158 at 177-178 [19]-[23], 235-236 [216], 274-275 [328]-[329]; [2000] HCA 62. Gummow ACJ Hayne Crennan Consideration of the issues presented in this matter must begin from the recognition that, as pointed out in DJL v Central Authority7, "clarity of thought and the isolation of the true issues [is not] encouraged by submissions expressed in general terms respecting the position in 'intermediate courts of appeal'". Rather, as the plurality went on to point out in DJL8: "In the case of each such court, State or federal, attention must be given to the text of the governing statutes and any express or implied powers to be seen therein. Nor is it of assistance to consider the position with respect to this Court in the exercise of its entrenched jurisdiction as a court of final appeal under s 73 of the Constitution, or with respect to the Privy Council or the House of Lords after R v Bow Street Metropolitan Stipendiary Magistrate; Ex parte Pinochet Ugarte [No 2]9". Secondly, it is important to recognise that underpinning consideration of the issues presented in this matter are fundamental principles about finality of litigation. As was said in D'Orta-Ekenaike v Victoria Legal Aid10: "A central and pervading tenet of the judicial system is that controversies, once resolved, are not to be reopened except in a few, narrowly defined, circumstances." That tenet finds reflection in rules concerning the bringing of an action to set aside a final judgment on the ground that it was procured by fraud11 and in doctrines of res judicata and issue estoppel. The principal qualification to the general principle of finality is provided by the appellate system. But in courts other than the court of final resort, the tenet also finds reflection in the restrictions upon reopening of final orders after they have been formally recorded. The third consideration of principle which it is necessary to state at the outset is related to the second. It is that the principle of finality serves not only to protect parties to litigation from attempts to re-agitate what has been decided, but (2000) 201 CLR 226 at 247 [43]; [2000] HCA 17. (2000) 201 CLR 226 at 247 [43]. See also Elliott v The Queen (2007) 82 ALJR 82 at 85 [7]; 239 ALR 651 at 654; [2007] HCA 51. 10 (2005) 223 CLR 1 at 17 [34]; [2005] HCA 12. 11 DJL v Central Authority (2000) 201 CLR 226 at 244-245 [36]-[37]. Gummow ACJ Hayne Crennan also has wider purposes. In particular, the principle of finality serves as the sharpest spur to all participants in the judicial process, judges, parties and lawyers alike, to get it right the first time. Later correction of error is not always possible. If it is possible, it is often difficult and time-consuming, and it is almost always costly. The premise for argument It is desirable to expose and explore a premise that underpinned the debate in the present matter about the powers of the Court of Criminal Appeal. The premise for the arguments of both the appellant and the respondent was that the formal recording of the orders of the Court of Criminal Appeal was a significant step. Why is that so? In answering that question it is desirable to notice a point about terminology: the use in this context of the word "perfected" or cognate words. The formal recording of the orders of a superior court of record is often referred to as the "perfecting" of that order. Whether a court may reopen a proceeding and reconsider the order that has been pronounced is often described as hinging about whether the order has been "perfected". This use of terminology must not be seen as giving form and procedure precedence over substance and principle. The questions that arise in this matter must depend for their answer not upon what forms and solemnities have been observed but upon how effect is to be given to the principle of finality. In particular, what is to mark the point at which a court concludes its consideration of a controversy? The end of a court's powers to consider and determine a controversy cannot depend upon whether one party asserts that the court has made some error in the conclusion it has reached. If allegation of error in the court's orders were the criterion, there would never be an end to some disputes. And because one party's assertion of error cannot provide a sufficient criterion, a court's belief that it has recognised its own mistake can provide no useful criterion. Such a belief could provide no useful criterion because, in the end, the accuracy of the belief would have to be tested against the arguments of the parties. It follows therefore that no matter whether it is a party that alleges error, or it is the court itself which believes that it recognises its own error, a decision that an error had been made could be reached only after giving all parties an opportunity to be heard. And it is this reargument of issues that would constitute the departure from the principle of finality. Identifying the formal recording of the order of a superior court of record as the point at which that court's power to reconsider the matter is at an end Gummow ACJ Hayne Crennan provides a readily ascertainable and easily applied criterion. But more than that, identifying the formal recording of the order as the watershed both marks the end of the litigation in that court, and provides conclusive certainty about what was the end result in that court. The power to correct the record so that it truly does represent what the court pronounced or intended to pronounce as its order12 provides no substantial qualification to that rule. The power to correct an error arising from accidental slip or omission, whether under a specific rule of court or otherwise, directs attention to what the court whose record is to be corrected did or intended to do. It does not permit reconsideration, let alone alteration, of the substance of the result that was reached and recorded. Neither the appellant nor the respondent challenged any of these propositions. Rather, the accepted premise for the debate was that formal recording of the orders of the Court of Criminal Appeal ordinarily does mark the end of that Court's power to consider the issues which were tendered in the proceedings that yielded those orders. Hence the expression of the question for this Court as whether the Court of Criminal Appeal had power to reopen the appellant's appeals and reconsider its orders. And as explained earlier, if the Court of Criminal Appeal had power to reopen the appellant's appeals and reconsider the orders it had made, that power must be found in "the text of the governing statutes and any express or implied powers to be seen therein"13. That is, the power must be found in the Criminal Appeal Act 1912 (NSW) ("the Criminal Appeal Act"). Part 2 of the Criminal Appeal Act (ss 3 and 4) constitutes the Supreme Court of New South Wales as the Court of Criminal Appeal and permits the appointment of a Registrar and other officers of that Court. Part 3 of that Act (ss 5-9) provides rights of appeal and provides for the determination of appeals. Part 4 (ss 10-23) provides for the procedure of the Court of Criminal Appeal. In Grierson v The King14, this Court held that the jurisdiction of the Court of Criminal Appeal of New South Wales "is statutory, and the court has no 12 L Shaddock & Associates Pty Ltd v Parramatta City Council [No 2] (1982) 151 CLR 590 at 594-595; [1982] HCA 59. 13 DJL (2000) 201 CLR 226 at 247 [43]. 14 (1938) 60 CLR 431; [1938] HCA 45. Gummow ACJ Hayne Crennan further authority to set aside a conviction upon indictment than the statute confers"15. More particularly, this Court held that the Court of Criminal Appeal had no jurisdiction to reopen an appeal which it had heard upon the merits and finally determined. Grierson has been followed in this Court on a number of occasions, most recently in Elliott v The Queen16. The Solicitor-General for New South Wales, appearing for the respondent in the present proceedings, expressly disclaimed any application to have this Court reconsider its decision in Grierson. Instead, the Solicitor-General submitted only that, "[i]f there was a denial of procedural fairness in this matter it lay in the fact that the order [disposing of the appeal] was perfected the same day and very soon after the reasons for judgment were handed down" and that "[i]f the denial of procedural fairness qualification referred to in [Pantorno v The Queen17] and [Postiglione v The Queen18] applied, then this inadvertent procedural unfairness may have allowed the court to re-open the order to allow the acknowledged factual errors to be corrected" (emphasis added). It is not necessary to consider whether some forms of denial of procedural fairness could warrant grafting some exception upon the general rule stated in Grierson. Nor is it necessary to examine what was said in either Pantorno or Postiglione about these matters. Neither case decided that the general rule in Grierson should be qualified according to whether there had been a denial of procedural fairness. It is therefore not necessary to consider what root could be found in the Criminal Appeal Act for such a proposition, and as both Grierson and DJL make abundantly plain, it is there that the source of any such exception must be found. Rather, it is sufficient in this case to say that formally recording the orders of the Court of Criminal Appeal before the parties had examined the published reasons of the Court did not amount to any denial of procedural fairness. Each party had had a full opportunity to place his or its arguments before the Court of Criminal Appeal. If either party had detected the factual errors made in this matter in the reasons of the Court of Criminal Appeal before its orders were 15 (1938) 60 CLR 431 at 435. 16 (2007) 82 ALJR 82 at 85 [7]; 239 ALR 651 at 654. 17 (1989) 166 CLR 466 at 484; [1989] HCA 18. 18 (1997) 189 CLR 295 at 300; [1997] HCA 26. Gummow ACJ Hayne Crennan perfected, that party could have and should have19 at once moved the Court of Criminal Appeal to intercept the processes of formal recording of the orders and to hear argument about whether errors had been made. But it would be contrary to principle to hold that the Court of Criminal Appeal must afford a sufficient opportunity for parties to consider whether such an application should be made. The parties to an appeal are given procedural fairness by allowing each a proper opportunity to make submissions before the court makes its decision. Once the court announces the decision it has made, any further hearing is exceptional. To hold that parties must be given a sufficient opportunity to consider whether to ask for a further hearing would convert the exception into the rule. That step should not be taken. For these reasons, the appeal to this Court should be allowed. The Court of Criminal Appeal did not have power to reopen the appeals after its first orders had been formally recorded. The second orders of the Court of Criminal Appeal were made without power and for that reason should be set aside. There being no dispute that the first orders were pronounced on an infirm factual foundation, those orders must also be set aside. It would not be appropriate for this Court to undertake the fresh consideration of the appeals to the Court of Criminal Appeal that must now be undertaken. The better course is to remit the appellant's appeal against conviction, and his application for leave to appeal against sentence, to the Court of Criminal Appeal for rehearing. 19 Texas Co (Australasia) Ltd v Federal Commissioner of Taxation (1940) 63 CLR 382 at 457; [1940] HCA 9; DJL (2000) 201 CLR 226 at 244 [34]. Gummow ACJ Hayne Crennan Amendment to Criminal Appeal Rules Since the Court of Criminal Appeal decision in this matter, the Criminal Appeal Rules have been amended to permit the Court of Criminal Appeal, of its own motion, to set aside or vary an order within 14 days after it is entered "as if the order had not been entered"20. No question about the validity or operation of that rule was argued in this matter and none need be or is decided. 20 Criminal Appeal Rules 1952 (NSW), r 50C(3). Kirby KIRBY J. On the return of an application arising from a judgment and order of the New South Wales Court of Criminal Appeal21, this Court granted special leave to appeal, limited to two grounds. Those grounds concerned the course taken in a second hearing and disposition by that Court. Specifically, the first ground was limited to whether the Court of Criminal Appeal had jurisdiction and power to reopen an appeal which it had earlier determined by an order of dismissal, publicly pronounced and formally entered in the records of the Supreme Court of New South Wales as the court of trial22. The second ground asserted that the members of the Court of Criminal Appeal erred in failing to disqualify themselves from deciding the reopened appeal, assuming the Court to have had such jurisdiction. Because of apprehended bias by pre-judgment, based on the earlier disposition, it was submitted that the Court of Criminal Appeal ought then to have referred to a differently constituted bench both the application to reopen the appeal and any reconsideration of it, if reopening were legally permissible and appropriate. In addition to these threshold issues, the panel granting special leave referred into the Full Court of this Court residual applications for special leave to appeal based upon grounds addressed to the substantive merits of the appeal as it had earlier been presented to the Court of Criminal Appeal. Full written submissions were received from both parties, addressed to the appeal and to the residual applications. Upon the return of the proceedings before this Court, we elected to hear first the parties on the first admitted ground of appeal. The other arguments were postponed to a later proceeding should that prove necessary23. In the result, I agree in the orders proposed by Gummow ACJ, Hayne, Heydon, Crennan and Kiefel JJ in their joint reasons. It is not necessary, nor would it be appropriate, for this Court to embark upon a consideration of the merits of the substantive submissions advanced by Mr Bruce Burrell in support of his application. He is entitled to succeed upon his threshold contention that his appeal to the Court of Criminal Appeal miscarried, resulting in an error which that Court had neither jurisdiction nor power to correct for itself. Mr Burrell having succeeded on that ground, the challenge in this Court results in a 21 Burrell v The Queen [2007] NSWCCA 65 (first decision of 16 March 2007). 22 Burrell v The Queen [2007] NSWCCA 79 (second decision of 23 March 2007). 23 [2008] HCA Trans 221 [610]. Kirby conclusion that he has not had his "appeal" determined by the Court of Criminal Appeal as the Criminal Appeal Act 1912 (NSW) ("the Act") envisages. He is entitled to an appeal that conforms to the Act. That is why I agree in the orders proposed in the joint reasons. I will explain these conclusions in my own words. I do so because: . I am rather more sympathetic to the legal propositions advanced by the Court of Criminal Appeal to sustain the course that it adopted than appears in the joint reasons. I consider that there is more to the course followed in that Court than my colleagues perceive; . Some of the past reasoning in this Court (as well as submissions of legal . My respect for that Court and the extensive arguments of the parties principle) suggest a possible legal foundation for what was done; and encourage me to offer this elaboration. With Gibbs J in Gamser v Nominal Defendant24, I say again that: "I regard it as unfortunate that the inherent power of an appellate court does not extend to varying its own orders when the interests of justice require it." I have said this25, and suggested26 so much in earlier decisions in this Court. I remain of the same opinion. However, I am required to acknowledge that the opinion that prevails in this Court's authority, specifically when addressed to the jurisdiction and powers of a court of criminal appeal such as that in New South Wales, denies any legal entitlement of such a court, in a case such as the present, to reopen its own orders, formally pronounced and entered in court records. This is so, despite some indications to the contrary in decisional authority and in terms of legal principle. I will explain how I come to this conclusion. Effectively, it requires that the matter be returned to the Court of Criminal Appeal for a completely fresh hearing. The facts Mr Burrell was charged with detaining Mrs Kerry Whelan with intent and for advantage on 6 May 1997 and with murdering her on or about 6 May 1997. 24 (1977) 136 CLR 145 at 147; [1977] HCA 7. 25 DJL v Central Authority (2000) 201 CLR 226 at 266 [98]-[99]; [2000] HCA 17. 26 Postiglione v The Queen (1997) 189 CLR 295 at 343; [1997] HCA 26. Kirby On that day, in Sydney, Mrs Whelan disappeared without expectation, warning or notice. She left behind her husband and three children, to whom the evidence showed she was devoted. The evidence also showed that Mrs Whelan was expecting later that day to depart with her husband by plane for Adelaide. Mr Burrell had at one stage worked for a company with which Mrs Whelan's husband was associated. In December 1990 he had been made redundant. Shortly before Mrs Whelan's disappearance, Mr Burrell re-established contact with Mr Whelan and his wife. At trial, the prosecution case against Mr Burrell relied on circumstantial evidence. It is unnecessary for the issue that determines this appeal to describe that evidence. Suffice it to say that, in certain respects, it was not insubstantial. In crimes of the kind charged, it is by no means unique, or even unusual, for the prosecution to have to rely on circumstantial evidence27. The charges detailing the subject offences were first brought in April 1999. In December of that year, Mr Burrell was committed for trial upon them. Hearings anterior to a first trial took place in the Supreme Court of New South Wales between January and April 2001 before Sully J. After a number of voir dire hearings, the trial did not commence. The matter was stood over to a date to be fixed. In April 2001 the Director of Public Prosecutions for New South Wales filed a nolle prosequi in respect of both counts. Following an inquest in May and June 2002 into Mrs Whelan's disappearance, the Director, in September of that year, filed a fresh ex officio indictment. This contained the two stated counts relating to the disappearance and alleged murder of Mrs Whelan. There followed applications by Mr Burrell for a stay of the proceedings upon those charges. Such applications were refused. The refusals were, in turn, contested without success before the Court of Criminal Appeal and in this Court. The trials and the appeal In the result, in August 2005, the first substantive trial of Mr Burrell on the charges began in the Supreme Court of New South Wales before Barr J and a jury. At the end of that trial the jury were unable to agree upon their verdicts. At a second trial before Barr J and a fresh jury, verdicts of guilty were returned on both counts. Mr Burrell was convicted. He was sentenced to imprisonment for life for the offence of murder and to imprisonment for sixteen years for the offence of detaining the deceased for advantage. 27 cf De Gruchy v The Queen (2002) 211 CLR 85 at 95 [40]; [2002] HCA 33. Kirby Mr Burrell appealed to the Court of Criminal Appeal against his convictions. He also sought leave to appeal against the sentences imposed on him by Barr J. His proceedings were heard on all issues on 30 November 2006 before a court constituted by McClennan CJ at CL, Sully and James JJ. On Friday, 16 March 2007, that Court dismissed the appeal against the convictions. It granted leave to appeal against the sentence but ordered that such appeal also be dismissed. The reasons of the Court for these orders were delivered by the presiding judge. The other members of the Court concurred in his reasons without added reasons of their own. The reasons of the Court comprised, in all, 126 pages. By inference, they were published and handed down in the conventional way at a public sitting of that Court. In accordance with the then practice of the Court, a notification of the Court's determination of the "application of Bruce Burrell to appeal against conviction and sentence" was prepared in the Court's registry on the day of the pronouncement of the orders ("the Notification"). The Notification was contained in a document to which the seal of the Court of Criminal Appeal of New South Wales was attached, together with a signature of a person stated to be executing the Notification "for the Registrar [of the Court of Criminal Appeal]". The second hearing on appeal Relisting on discovery of mistakes: On Monday, 19 March 2007, a transcript discloses that a further hearing of the Court of Criminal Appeal took place before McClellan CJ at CL, sitting alone. Representatives of both parties appeared, including the Solicitor-General for New South Wales, appearing for the prosecution. McClellan CJ at CL is recorded as stating that it had been brought to his associate's attention that morning "that the judgment, which I prepared and the other members of the Court joined in, when recounting the Crown case, ha[d] some inaccuracies". This eventuality was explained by reference to his Honour's having drawn "upon a document … headed 'Facts alleged in the Crown case'". That document was said to have come "to the judges as part of the appellant's submissions". This led to its being "mistakenly assumed [to be] an accurate document. It turns out it is not." McClellan CJ at CL questioned counsel as to whether "either [counsel] have had a chance to look at the judgment to see the inaccuracies". He said that the mistakes needed "to be corrected". He sought submissions as to how this might be done, given that one of the judges constituting the Court of Criminal Appeal (Sully J) was due to retire on the following Friday, 23 March 2007. Counsel for Mr Burrell immediately submitted that the judgment could not be corrected. However, the Solicitor-General stated "[w]e agree that it can be corrected at this stage." Kirby On 21 March 2007 the proceedings were relisted for argument before the Court of Criminal Appeal, constituted as before. At that hearing, counsel for Mr Burrell submitted that the proceedings should be relisted before a bench differently constituted. He repeated the submission that correction of the judgment and orders was beyond the power of the Court of Criminal Appeal, given that the pronounced orders of that Court had passed into judgment and had been entered in the record of the Court, as signified by the Notification under the seal of the Court and the signature for its Registrar. The prosecution again supported a power to correct in the circumstances. New order and amended Notification: After reserving its decision for two days, on 23 March 2007, the Court of Criminal Appeal delivered supplementary reasons titled "Judgment". The formal order made at the conclusion of those reasons was pronounced for the Court by McClellan CJ at CL. It was that "the order of the Court dismissing the appeal should be confirmed". Again, Sully and James JJ agreed with that disposition, without additional reasons of their own. What was described as an "Amended Notification of Court's Determination of Application" recounted that the Court: "… on 16 March 2007, ordered that: The appeal be dismissed. And, on 23 March 2007, further ordered that: The order of the Court dismissing the appeal should be confirmed." The seal of the Court of Criminal Appeal was again attached, ostensibly with the same officer signing "For the Registrar". It is from this second purported order that the present appeal comes by special leave. It occasions Mr Burrell's challenge to the jurisdiction and power of the Court of Criminal Appeal to make any further order disposing of Mr Burrell's appeal to that Court, beyond that pronounced and entered on 16 March 2007. The applicable legislation Provisions of the Act: In Stewart v The King28, this Court, for constitutional purposes29, held that the Court of Criminal Appeal, created in accordance with the Act, was a manifestation of the Supreme Court of New South Wales. Under the Act, it is provided in s 3(1): 28 (1921) 29 CLR 234; [1921] HCA 17. 29 See Constitution, s 73(ii); cf s 106. Kirby "The Supreme Court shall for the purposes of this Act be the Court of Criminal Appeal, and the court shall be constituted by such three or more judges of the Supreme Court as the Chief Justice may direct." The question in Stewart was whether the Court of Criminal Appeal was a new and distinct statutory appellate court created by the Parliament of New South Wales or "the Supreme Court of [a] State" from which an appeal lay to this Court by s 73 of the Constitution. It was held that the Court of Criminal Appeal was a manifestation of "the Supreme Court" of the State and therefore that this Court had jurisdiction, "with such exceptions and subject to such regulations as the [Federal] Parliament prescribes", to hear and determine appeals from all judgments and orders of that Court. From the establishment of this Court, appeals had been brought in criminal proceedings by special leave granted by this Court in accordance with the Judiciary Act 1903 (Cth)30. It had been assumed that such appeals continued, under such arrangements, once the Court of Criminal Appeal was created by the Act in 1912. The correctness of that assumption was confirmed by the decision in Stewart. By s 4 of the Act, it is provided that "registrar[s] and such other officers as may be required for carrying out this Act may be employed under Chapter 2 of the Public Sector Employment and Management Act 2002". By s 28(1) of the Act, provision is made for the making of rules of court "for the purposes of this Act". Such Rules are to be made by a Rule Committee consisting of the Chief Justice, the President of the Court of Appeal, one other appointed Judge of Appeal, four other appointed judges and an appointed barrister and solicitor31. The subject matter of the Rules that may be made in this way extends to the "regulation of the practice and procedure under this Act"32 and "[a]ny matters which in the opinion of the Rule Committee of the Supreme Court are necessary or expedient for giving effect to the purposes of this Act"33. At the time of each of the foregoing proceedings before the Court of Criminal Appeal concerning Mr Burrell, no rule was in force that purported (so 30 s 35. The statement in [2007] NSWCCA 79 at [23] that Grierson was decided at a time when there was an appeal as of right to this Court was incorrect in so far as it implied that there was ever such an appeal by right in criminal matters. 31 s 123(1), Supreme Court Act 1970 (NSW). 32 The Act, s 28(2)(a). 33 The Act, s 28(2)(h). Kirby far as this might be done by rule) to enlarge the jurisdiction and powers of that Court to retrieve an order entered in the court records so as to permit the Court to reconsider and (if it thought fit) amend, vary, correct or change an order earlier entered. By s 12 of the Act it is provided, relevantly: "(1) The court may, if it thinks it necessary or expedient in the interests of justice: … exercise in relation to the proceedings of the court any other powers which may for the time being be exercised by the Supreme Court on appeals or applications in civil matters, and issue any warrant or other process necessary for enforcing the orders or sentences of the court: Provided that in no case shall any sentence be increased by reason of, or in consideration of any evidence that was not given at the trial." The Criminal Appeal Rules: Pursuant to the power granted by s 28 of the Act, the Criminal Appeal Rules 1952 (NSW) were made. Rules 50A, 51, 52 and 53, as in force at the relevant time34, draw a distinction between the pronouncement of the orders of the Court of Criminal Appeal, in disposing of an appeal or application, and the formal entry of those orders in accordance with that pronouncement: "50A Determination of appeal or application An appeal or application for leave to appeal is determined on the making of orders disposing of the appeal or application. Notice of determination of appeal etc The Registrar shall send a notice of the determination of any appeal, or of any application incidental thereto, to the appellant, if he was not present when the matter was determined, to the proper officer of the Court of Trial, to the Director-General of Corrective Services and to the Sheriff, if the appeal is against a conviction involving a sentence of death or is against a sentence of death. 34 Rule 53 was repealed in 2007 after the appeals were heard in this case in the Court of Criminal Appeal. Kirby Notice of orders or directions by Court The Registrar shall also notify the proper officer of the Court of Trial of any orders or directions made or given by the Court in relation to such appeal. Records of Court of Trial to be noted Such proper officer shall thereupon enter the particulars of such notification on the records of the Court of Trial. Such entry shall be made administration of the Court of Trial on: in conformity with the the indictment, the appropriate Court file, or The appropriate computer record." In accordance with the foregoing rules it would appear that the Court of Criminal Appeal determined Mr Burrell's appeal and application on 16 March 2007 by making its orders disposing of them. Conventionally, this act is performed by the publication of the reasons and the handing down of the originals of those reasons by or on behalf of the judges, duly certified, ultimately to an officer of the registry of the Court of Criminal Appeal. In the present case with very great speed, that officer or some other officer on behalf of the Registrar took the steps contemplated by the rules to "enter" (sometimes called "formalise" or "perfect") the particulars of such Notification in the records, as r 53(1) then provided. In so far as the law draws a distinction between the oral public pronouncement of orders and the formalisation of such orders by their entry in the records of the Court of Trial, the Criminal Appeal Rules, applicable at the relevant time, reflected that distinction and formal practice. On the face of the requirements of the Rules then governing the procedures of the Court of Criminal Appeal it can be taken that the records of the Court of Trial were duly noted with the orders of the Court of Criminal Appeal on the date of their pronouncement, namely 16 March 2007. Neither party before this Court contested that fact. The Uniform Civil Procedure Rules: So far as the powers afforded to the Court of Criminal Appeal by s 12 of the Act are concerned, at the relevant time they attracted to that Court "in relation to the proceedings of the Court" the general powers provided to the Supreme Court of New South Wales, specifically under the Uniform Civil Procedure Rules 2005 (NSW). Kirby By r 36.17 of those Rules a particular provision is made for the "correction of judgment or order", otherwise known as the "slip rule": "If there is a clerical mistake, or an error arising from an accidental slip or omission, in a judgment or order, or in a certificate, the court, on the application of any party or of its own motion, may, at any time, correct the mistake or error". No one in the present proceedings suggested (and McClellan CJ at CL during argument denied), that the "slip rule" had any application to the mistake disclosed in the reasons published in the present case. However, there is more. By r 36.15 of the Uniform Civil Procedure Rules, particular provision is made for a general power to set aside judgments or orders of the court: "(1) A judgment or order of the court in any proceedings may, on sufficient cause being shown, be set aside by order of the court if the judgment was given or entered, or the order was made, irregularly, illegally or against good faith. (2) A judgment or order of the court in any proceedings may be set aside by order of the court if the parties to the proceedings consent." None of the circumstances disclosed in these proceedings attracts either of the powers afforded by r 36.15. The preconditions to the application of that Rule were not enlivened. Accordingly, the general power of correction afforded to the Court of Criminal Appeal by way of s 12 (assuming that section to apply outside the particular categories mentioned there) was not engaged. By r 36.16 of the Uniform Civil Procedure Rules, as it then applied, a still further power was afforded to the Supreme Court to set aside, or vary, a judgment or order. Relevantly, that Rule provided35: The court may set aside or vary a judgment or order if notice of motion for the setting aside or variation is filed before entry of the judgment or order. The court may set aside or vary a judgment or order after it has been entered if: 35 Rule 36.16 was amended in 2007 after the appeals were heard in this case in the Court of Criminal Appeal to insert sub-rr 3A, 3B and 3C. These sub-rules echo the current provisions under r 50C(3) of the Criminal Appeal Rules. Kirby the judgment or order has been entered under Part 16 (Default judgment), or the judgment or order has been given or made in the absence of a party … in the case of proceedings for the possession of land … in the absence of a person whom the court has ordered to be added as a defendant … (3) Without limiting subrules (1) and (2), the court may set aside or vary any order … except so far as the order: determines any claim for relief … or dismisses proceedings; (4) Nothing in this rule affects any other power of the court to set aside or vary a judgment or order." Assuming that the provisions of r 36.16 are attracted by way of s 12 of the Act to the order of the Court of Criminal Appeal entered in the records in the present case and apply to that Court, none of the provisions of that Rule was shown to apply. On the contrary, the order entered in the records of the Court of Criminal Appeal on 16 March 2007 determined Mr Burrell's claim for relief in that Court. Moreover, it dismissed his proceedings without qualification. The resulting issue: In this way, in terms of the provisions of, or Rules made under, the statute to govern the consequences of orders of the Court of Criminal Appeal that have been "entered", that Court was driven back to the recognition, reflected in r 36.16(4) of the Uniform Civil Procedure Rules, that a residuum of powers exists in a court, including by virtue of the common law governing the "implied" or "inherent" powers of a court, to set aside or vary an order, including where that order has earlier been entered in the court records. It follows that the legal question remaining in this appeal is whether (as the Court of Criminal Appeal concluded in its second decision and orders) a residual power exists in such a court to reopen, recall, reconsider and redetermine (or confirm) by fresh order, a proceeding initiated by a party (or by the Court itself) where the application to do so is promptly brought upon the discovery of a mistake in the Court's reasoning which, if allowed to stand, would occasion an injustice, or a miscarriage of justice, to a party to the earlier disposition36. 36 Stephens (1990) 48 A Crim R 323 at 326 (a case where the order had not been entered); cf In re Harrison's Share; In re Williams' Will Trusts [1955] Ch 260 at (Footnote continues on next page) Kirby Four relevant realities Divergences in judicial approach: An analysis of the decisions of judges upon questions concerning the power of courts to repair errors and mistakes would probably disclose differing patterns of responses, even where the power in question was said to lie in a superior court, indeed in the Supreme Court of a State of the Commonwealth. Such a court is the only court specifically named as such in the Constitution,37 apart from this Court38 and, by description the Judicial Committee of the Privy Council.39 By the Constitution and by relevant legal history, the Supreme Court of a State is a judicial tribunal enjoying the widest possible jurisdiction and power. Its "orders" and "judgments" have a constitutional significance, given that by s 73 of the Constitution they afford the foundation for the facility of appeal to this Court. In Aussie Vic Plant Hire v Esanda Finance Corporation40, in the context of explaining the broad approach that has recently been taken by this Court towards the ambit of a statutory grant of jurisdiction and power to a superior court, I identified the differing "general inclinations" exhibited by judges, including in this Court41: "… [S]ome judges incline to a narrower application of legislation so as to maximise the role of strict rules and to minimise the space for discretion that may adapt to the special demands of justice in the particular case. There are several instances where this tension has revealed itself42. Nevertheless, the general trend in this Court in recent years has, I believe, been to uphold the broad grant of jurisdiction and power to a court where this is afforded by legislation in terms that permit the court to soften the 269; In re Barrell Enterprises [1973] 1 WLR 19 at 23-24; [1972] 3 All ER 631 at 636-637; Pittalis v Sherefettin [1986] QB 868 at 879, 882. 37 Constitution, s 73(ii). 38 Constitution, ss 71, 72, 73, 75, 76, 77. 39 Constitution, s 74. 40 (2008) 82 ALJR 564; 243 ALR 207; [2008] HCA 9. 41 (2008) 82 ALJR 564 at 573 [43]; 243 ALR 207 at 218. 42 See eg Jackamarra v Krakouer (1998) 195 CLR 516 (Brennan CJ, McHugh and Kirby JJ; Gummow and Hayne JJ dissenting); [1998] HCA 27. Kirby edges of overly rigid applications of procedural and other rules, and where otherwise an unyielding application of the law might defeat the attainment of justice in the particular case43." In Aussie Vic, I speculated that differences of this kind might be attributed to differing judicial conceptions of "the ameliorating role of courts of justice; a recognition of (and allowance for) human frailty; or the scars of particular professional experiences"44. I went on to say45: "… [w]hen a choice exists in the construction of legislation, the trend of this and other courts has been to accept the need to uphold provisions that permit courts to cure particular defaults for reasons of justice". Similar considerations are presented by the present case. Exceptional powers to cure errors and injustices have certainly been acknowledged by courts, including this Court, even where the formal order of a court has been duly entered or "perfected"46. Just as in the law, we can love truth, like all other good things, unwisely; pursue it too keenly; and be willing to pay for it too high a price47, so we can also love finality too much. In our understandable concern to secure finality to litigation, we can fall into the error of allowing that value to swamp all other concerns that rightly agitate the courts. Such may sometimes be the case where we are asked to uphold a formal order of a superior court as "final" and unarguable, simply because it was "entered" by a mechanical, unconsidered step of non-judicial officials and although, promptly, it might be demonstrated that the entered order works an injustice which may otherwise not be capable of effective, speedy or economical repair by the normal operations of the court system. 43 See eg Queensland v J L Holdings Pty Ltd (1997) 189 CLR 146 at 167-172; [1997] HCA 1. 44 cf Kirby, "Ten Parables for Freshly-minted Lawyers", (2006) 33 University of Western Australia Law Review 23 at 24-25. 45 (2008) 82 ALJR 564 at 573 [44]; 243 ALR 207 at 218. 46 Allars, "Perfected judgments and inherently angelical administrative decisions: The powers of courts and administrators to reopen or reconsider their decisions", (2001) 21 Australian Bar Review 50 at 50-51. 47 Pearse v Pearse (1846) 1 De G & SM 12 at 28; [63 ER 950 at 957] per Knight Kirby Against these considerations (which I should say did not prevail in Aussie Vic48) countervailing considerations are arguably enlivened in the present case. Here, the proceedings are criminal in character. Mr Burrell has been sentenced to the highest punishment now known to the law. Conventional approaches demand rigorous compliance with the law in cases such as this and high accuracy in recounting the evidence relevant to the determination of his appeal. The postulate of the Act is that an appellant will have an appeal to the Court of Criminal Appeal decided accurately and not on the basis of incorrect, irrelevant or superseded facts. Approaches to the powers of courts that may be read into legislation concerned with the determination of civil cases, may not so readily be accepted in the case of legislation governing criminal appeals even though the court concerned is substantially the same repository of the jurisdiction and power in question. Nevertheless, in a superior court of record, a wide power will normally be taken as "implied" or "inherent" in the general grant of jurisdiction and power, so as to permit the court in question to repair promptly, and not merely lament, mistakes and oversights occasioning injustice. Practice in courts of criminal appeal: The mistake that occurred in the present case arose because, "as a matter of history", Mr Burrell's representatives included in material provided to the Court of Criminal Appeal a "Crown statement (tendered upon the stay application in 2003)". According to Mr Burrell, this document was provided to the Court in a folder with appendices to the defence submissions. It was noted in the index to the appendices as being the Crown statement dating from 2003. It was not a Crown statement prepared for consideration and use by the Court of Criminal Appeal in the subject appeal. In his written submissions, Mr Burrell is critical of the Court of Criminal Appeal for having relied as it did on the document so supplied. He points to annotations on the face of the document; the well known fact that the proceedings against him had been prolonged and extended; and the fact revealed to the Court that some matters of evidence had been determined in 2001 by Sully J; some in 2003 by Wood CJ at CL; and others in 2005 by Barr J (who adopted several of the foregoing rulings as his own in each of the two trials of Mr Burrell over which he presided). Mr Burrell is critical of the Court of 48 Aussie Vic Plant Hire v Esanda Finance Corp (2008) 82 ALJR 564 at 570 [27]; 243 ALR 207 at 214; cf in the Court of Appeal of Victoria: (2007) 212 FLR 56 at 59-70 [28]-[31] and [56]-[58] per Maxwell P and Neave JA dissenting. Kirby Criminal Appeal for treating certain grounds of appeal (grounds 3 to 7) as still alive in the appeal when they had actually been withdrawn. In support of these criticisms, he points to the fact that transcript references were not included on the face of the 2003 "Crown Statement" (as it was suggested) is normal for a concluded statement of such a kind. Nevertheless, as Mr Burrell's written submissions correctly acknowledge before this Court, it has long been the practice in New South Wales for representatives of the prosecution to prepare a "Crown Case Statement". Initially, this may be done before the trial, setting out a summary of the case that the prosecution hopes to prove at trial. Such a statement is not only used in the trial but also, sometimes with necessary amendments, as a factual basis for pre- trial applications that are now so common49; as a foundation for sentencing proceedings50; and (generally with additions, amendments and transcript references) to assist the parties and the Court of Criminal Appeal in the discharge of the appellate functions. In the circumstances of the inclusion of the outdated ("historical") version of that Statement in the present appeal, I can readily understand how the errors now complained of occurred. Separation of more than a decade has not caused me to forget the burdens placed upon judges in courts of criminal appeal in this country. Whereas this Court has substantial powers to control the number of appeals and applications that it will hear orally, both under statute51 and by new Rules governing dispositions on the papers52, courts of criminal appeal (at least in conviction appeals in New South Wales) have no such ready means of relief. This is the real world in which judges, disposing of such appeals, have to perform their functions. On many days several appeals are listed for hearing, sometimes as many as (or occasionally more than) six. The Court of Criminal Appeal would not be humanly capable of disposing of such cases without the assistance of factual summaries. Such documents are quite often used as the foundation for ex tempore dispositions designed to promote expeditious decision- making in matters that often affect personal liberty. 49 R v Petroulias (2005) 62 NSWLR 663 at 678 [56]. 50 R v MA (2004) 145 A Crim R 434. 51 Judiciary Act 1903 (Cth), s 35(2). 52 High Court Rules 2004, rr 41.10.5 and 41.11.1; cf Kirby, "Maximising Special Leave Performance in the High Court of Australia", (2007) 30 University of New South Wales Law Journal 731 at 736-739. Kirby This Court should exhibit a realistic understanding of the context in which the question of the jurisdiction and power of the Court of Criminal Appeal to correct mistakes, promptly called to notice, falls to be decided. Especially so because it is this Court that has repeatedly insisted upon the individual duties cast upon the judges constituting a court of criminal appeal to review the entirety of the evidence for themselves53 and to decide even non-determinative grounds of appeal against the possibility that a decision on such grounds might prove important in a further appeal to this Court54. In decisions concerning the application of the "proviso", the hypothesis for the stern rule now adopted by this Court in Weiss v The Queen55 is that the judges of a court of criminal appeal have had the time, opportunity and assistance, to consider thoroughly and reflect upon all of the evidence that might touch upon any propounded "miscarriage of justice" urged by an appellant56. None of the foregoing realities is mentioned to suggest that a lower standard of vigilance is required against mistakes made by courts of criminal appeal; or that material mistakes should be condoned or ignored because of the time and other pressures on such courts. Nor do I suggest that this Court should condone sloppy practices on the footing that, if mistakes are quickly pointed out, they can be quickly corrected. However, a consideration of the realities of the world in which courts of criminal appeal operate in contemporary Australia, necessitates an acknowledgment that slips and mistakes can easily occur. This is so even in the case of highly experienced and conscientious judges. The foregoing considerations will inform the judgment of this Court concerning the available jurisdiction and power of the Court of Criminal Appeal, if acting promptly, to correct at least some such mistakes. And to do so notwithstanding that a clerk has (with arguably needless speed) entered the orders of the Court in court records before the parties or others have had a real 53 In the 2006/2007 Annual Report of the High Court of Australia there were 106 applications for special leave to appeal in criminal matters filed and 24 grants of special leave. 54 Jones v The Queen (1989) 166 CLR 409 at 414-415; [1989] HCA 16; Cornwell v The Queen (2007) 231 CLR 260 at 303 [113]; [2007] HCA 12. 55 Weiss v the Queen (2005) 224 CLR 300; [2005] HCA 81. 56 cf AK v Western Australia (2008) 82 ALJR 534 at 540 [23]-[26] per Gleeson CJ and Kiefel J, 544-545 [52]-[56] per Gummow and Hayne JJ, 563 [115] per Heydon J; 243 ALR 409 at 415-417, 422-423, 446; [2008] HCA 8. Kirby opportunity to note, and call to attention, any mistakes that are apparent in the reasons supporting the orders so made. Practicalities of reserved decisions: A further reality is illustrated by the present appeal. Whereas in the not so distant past most decisions of a court of criminal appeal were given for ex tempore reasons pronounced at the end of oral argument, more recent appeals have been marked by much longer and more detailed written and oral submissions and extended hearings. In part, this is a consequence of the vigilance of this Court for error. In part, it reflects the greater facilities for legal aid. In part, it results from the growing body and complexity of the criminal law and the practices governing sentencing. The written submissions for Mr Burrell in the Court of Criminal Appeal were long, substantial and detailed. They stimulated similar responses from the prosecution. If that Court were not to address submissions seriously made, it would leave itself open to criticism for such default on an application for special leave to appeal to this Court. The advent of obligations to provide written submissions has had a further consequence, relevant to the present appeal. The expansion of grounds of appeal has resulted in lengthier reasons, producing a heightened risk of error in describing the relevant evidence or applying material legal principles. Moreover, these developments have meant that there are many more reserved decisions including some (as in the present case) involving extensive reasons covering (as here) nearly 130 closely typed pages. In earlier times ex tempore reasons were typically given by judges in the Court of Criminal Appeal in the presence (usually) both of the appellant and counsel who could draw any obvious judicial mistakes or misunderstandings to immediate notice so that they could be considered or cured before orders were entered. However, this is impossible where a decision is reduced to writing and provided to the parties in circumstances that effectively deny an opportunity for consideration by legal advisers prior to the entry of the resulting orders in the court records. On the civil side, I have myself been persuaded by prompt intervention of the parties to withdraw reasons and, with the agreement of colleagues, to substitute differing reasons and sometimes substantially different orders57. In the 57 See eg Winrobe Pty Ltd v Sundin's Building Co Pty Ltd [No 2] (unreported, Court of Appeal (NSW), 24 December 1992); NSW Medical Defence Union Ltd v Crawford [No 3] (unreported, Court of Appeal (NSW), 23 September 1994) noted in Haig v Minister Administering the National Parks and Wildlife Act 1974 (1994) 85 LGERA 143 at 152-154 and in DJL v Central Authority (2000) 201 CLR 226 at 263 [91]; [2000] HCA 17. Kirby circumstances of the Court of Criminal Appeal, in a case such as the present, such facilities for correction were effectively frustrated. Hence, the inquiry by McClellan CJ at CL as to whether (despite an intervening weekend) the parties had actually had the opportunity to read the reasons and had noticed the errors already picked up by the Court. Availability of relief in this Court: Yet can it be said that a strict approach to finality of entered orders is supported by the availability in this Court of correction of mistakes and misunderstandings in judicial reasons of intermediate courts? It may be true that there is a greater willingness today to grant special leave in such matters than there was in earlier decades58. However, common experience and practical realism require an acknowledgment of the very significant hurdle that such applications confront and the comparatively small number of such cases annually to which this Court affords a grant of special leave59. To sustain an unbending rule against a facility for intermediate courts to correct their orders, entered administratively, where mistakes are promptly drawn to notice, simply on the footing that this Court is always available to repair demonstrated error would be to indulge in a fiction, not actual experience. A number of recent cases in which the "proviso", in the template provisions of Australian criminal appeal statutes, has been invoked to deny the intervention of this Court, despite a clear demonstration of error below60, suggests a need to moderate severely litigant expectations in this respect. Mr Burrell secured a grant of special leave. However, for every such grant there are very many refusals. Often they are explained by reference to the perceived lack of a "miscarriage of justice". 58 Kirby, "Why has the High Court become more involved in criminal appeals?", (2002) 23 Australian Bar Review 4. 59 The grants of special leave in criminal matters in recent years have been: of 109 applications filed in 2004/2005, 15 were granted: see 2004/2005 Annual Report of the High Court of Australia; of 100 applications filed in 2005/2006, 8 were granted: see 2005/2006 Annual Report of the High Court of Australia; of 106 applications filed in 2006/2007, 24 were granted: see 2006/2007 Annual Report of the High Court of Australia. These figures disregard the applications now disposed of on the papers, overwhelmingly by rejection of the application for special leave. 60 See Libke v The Queen (2007) 230 CLR 559; [2007] HCA 30. A recent example is CTM v The Queen [2008] HCA 25 at [36], [195]; cf at [121]. Kirby There has not so far developed in this country a general prosecutorial practice, defensive against such mistakes and injustice, to support prisoner applications for special leave and to consent to corrections of the orders a quo, where material error is demonstrated. During more than 12 years on this Court I have seen joint support from the prosecution and the prisoner to permit the cure of an accepted mistake in the reasoning of the intermediate court but once. In the present appeal, both on the relisting before the Court of Criminal Appeal and in this Court, the prosecution asserted the existence of the jurisdiction and power of the Court of Criminal Appeal to act as it did. It contested the necessity, or occasion, for this Court's intervention. In the light of the outcome of this appeal, it may be hoped that a reconsideration of prosecution practice in this regard will be one outcome. Traditionally, prosecutors for the Crown observed the highest standards as befits a model litigant. Such standards should be maintained. In light of this decision, and others, they will need to be reinforced61. Support for a power to reopen formalised orders The ambit of Grierson: There is no provision in the Act, nor in the Criminal Appeal Rules, nor any other positive law drawn to notice which was in force at the relevant time, that expressly forbids the reopening of orders of the Court of Criminal Appeal, pronounced and then entered in the Court records. The consequence of entry of the orders in court records therefore depends upon the principles of the common law ascertained by reference to any "implied" or "inherent" powers of the court in question. Such powers derive from the court’s character, composition, history and participating members. Such principles are declared by the judges. Obviously, the principles must serve the purpose of defending the finality of court orders, in particular the finality of the orders of superior courts of record. Moreover, such principles focus the attention both of the parties and the judges upon an understanding that such dispositions are not provisional. They require the greatest possible care, attention and accuracy in their formulation and pronouncement. On the other hand, common law principles exist to serve, and not to frustrate, the attainment of justice, allowing that debates and differences of opinion will often accompany the judicial identification of where a just outcome lies in the particular case. 61 cf Libke (2007) 230 CLR 559 at 578 [38]-[40]. Kirby The principal impediment of legal authority, in the way of supporting the conclusion of the Court of Criminal Appeal in this appeal, is the decision of this Court in Grierson v The King62. That decision, written 70 years ago, addressed the very Act that is under present consideration and that is relevantly unchanged. It held that "no court [including the Court of Criminal Appeal] has authority to review its own decision pronounced upon a hearing inter partes after the decision has passed into a judgment formally drawn up"63. The foundation of this dictum was explained by this Court in terms of legal history, judicial authority to that time and the fact that the jurisdiction and powers of the Court had to be found in the Act itself or by necessary implication or inference from its provisions. Nonetheless, the words of Dixon J in Grierson (with whom McTiernan J agreed) are not the same as statutory language. They have endured as a statement of general principle. Neither party to this appeal contested the accuracy of that general principle. The contest concerned the admissibility of a relevant exception. That there are some exceptions is undisputed. Indeed, in Grierson itself, one exception, available under the Judicature system, was acknowledged by Dixon J64. It was: "an action may be brought to set aside a judgment obtained by fraud" but as "an independent proceeding equitable in its origin and nature"65. In the manner of those times, there was also an acknowledgment by Dixon J that the English Court of Criminal Appeal, elaborating a statute that became the template for Australian legislation on criminal appeals, had said that it "will exercise a discretion to allow [a prisoner] to withdraw his notice of abandonment, notwithstanding that it operates as a dismissal of the appeal"66. Once exceptions and qualifications the general principle are acknowledged, the resulting legal debate necessarily shifts to a consideration of whether a further, analogous, exception exists applicable to the present case. In expounding a common law principle in the conventional way, it would be 62 (1938) 60 CLR 431; [1938] HCA 45. 63 (1938) 60 CLR 431 at 436 citing In re St Nazaire Co (1879) 12 Ch D 88. 64 (1938) 60 CLR 431 at 436. 65 Ronald v Harper [1913] VLR 311 at 318 per Cussen J. Jonesco v Beard [1930] AC 298 and Halsbury's Laws of England, 2nd ed, vol 19 at 266 were cited. 66 (1938) 60 CLR 431 at 437; Halsbury's Laws of England, 2nd ed, vol 9 at 273 and the cases cited in note o. Kirby unworthy of this Court to approach its functions mechanically or simplistically. I do not view Grierson as having done so. Nor should we, 70 years later. The status of the court a quo: In considering the possibility of a further exception along the lines of the one that, in its second hearing, the Court of Criminal Appeal upheld in this case67 it is appropriate to start with a full appreciation of the high status and functions of the Court of Criminal Appeal and hence its substantial implied or inherent powers, as such, to do justice in the exercise of its jurisdiction and to avoid needless injustice. The court is a the manifestation of Commonwealth. It comprises the highest judges of a State. Those judges are empowered by their office and appointment to do justice to all persons according to the laws and usages of the State. the constitutional Supreme Court of a State of In repeated decisions over many years68, following earlier English authority69, this Court has held that a grant of statutory power to a court (including the conferral of jurisdiction) especially where that court is a superior court of record, is to be construed broadly. It is not to be treated as subject to any limitation that does not appear in the express words of that grant. As Gaudron J explained in Knight v F P Special Assets Ltd70: "[a] grant of power should be construed in accordance with ordinary principles and, thus, the words used should be given their full meaning unless there is something to indicate to the contrary. Powers conferred on a court are powers which must be exercised judicially and in accordance with legal principle. … The necessity for the power to be exercised judicially tends in favour of the most liberal construction, for it denies the validity of considerations which might limit a grant of power to some different body, including, for example, that the power might be exercised arbitrarily or capriciously or to work oppression or abuse." In the present context there is an additional, local consideration. Because, in Australia, that court is a manifestation of the constitutional Supreme Court of the State, quite apart from the statutory provisions in s 12 of the Act, to which 67 [2007] NSWCCA 79 at [39]-[41]. 68 Knight v F P Special Assets Ltd (1992) 174 CLR 178; [1992] HCA 28. This principle may have still wider applications in the contemporary context: see Shi v Migration Agents Registration Authority [2008] HCA 31. 69 For example Hyman v Rose [1912] AC 623 at 631. 70 Knight (1992) 174 CLR 178 at 205. Kirby reference has been made, this feature of the court attracts to it the substantial implied or inherent jurisdiction of the Supreme Court of New South Wales. Historically, that jurisdiction may be traced, through imperial statutes, to the origins of such a court in the royal prerogative, continued into present times, from the Royal Charter first creating it. It means that the express statutory powers of its judges may be enhanced by implied (or possibly inherent) powers so long as these are not inconsistent with the applicable statutory or subordinate laws. In these circumstances, provisions in the Rules to regulate the practice and procedure of the Court under the Act71 may be subject to the implied or inherent powers of the Supreme Court to ensure that those rules do not become instruments for needless injustice that can readily, quickly and economically be repaired or avoided. Especially once exceptions to a completely rigid application of the general principles stated in Grierson are recognised, the large powers of the Supreme Court, shared with the Court of Criminal Appeal, exist (on the face of things) to ensure that needless injustices are overcome. Already recognised exceptions: Some exceptions to the Grierson principle are also created by, or recognised in, provisions made under statute. Thus the "slip rule", which would have existed anyway in the common law, is now expressed in the Uniform Civil Procedure Rules, r 36.17. That common law rule has been held applicable to court orders although the order on appeal has been formally perfected72. Where a source of correction is provided by or under statute, the availability of the jurisdiction and power to reopen a formalised order depends on the terms of the grant. Quite apart from statute, however, this Court has, since Grierson, acknowledged at least one clear exception to the strictness of the general principle stated there. I refer to the recognition of the power of this Court, as the final national court of appeal, in exceptional circumstances, to repair its own that would otherwise occasion a serious and mistakes and oversights 71 The Act, s 28(2)(a). 72 Carrion (2002) 128 A Crim R 29 at 32 [18]; R v Allen [1994] 1 Qd R 526; AN v The Queen (No 2) (2006) 163 A Crim R 133 at 140 [42]. Kirby irremediable injustice, despite the fact that its orders have been formalised73. The same power was upheld in England in the House of Lords74. Although the Court of Criminal Appeal is not, as such, a final appellate court, functionally, and for at least 98 percent of cases decided by it, its orders are final. This is the reason why this Court recognised that intermediate appellate courts in Australia must share with this Court the responsibility of declaring and developing general principles of the law75. So are the common law and statutory exceptions to the Grierson principle stated above an entire statement of such exceptions? Or was the Court of Criminal Appeal correct in this case to recognise, by analogical reasoning, the existence of a further such exception, applicable to the present circumstances? In my respectful opinion, that question is not answered simply by pointing to the decision in Grierson. It remains for this Court to decide the fundamental basis of that principle; the characteristics of the non-statutory exceptions already acknowledged; and to determine whether the present case permits of the additional exception stated by the Court of Criminal Appeal in this case. Omission or failure of jurisdiction: The second possible common law exception to the general principle in Grierson, expressly acknowledged by Dixon J in that case, was the discretion that the Court of Criminal Appeal in England had asserted to allow a prisoner to withdraw a notice of abandonment, notwithstanding that such notice operated, in law, as a dismissal of the appeal. This second exception was qualified by the statement that "in such a case there has been no determination by the Court"76. Possible reservations about the 73 State Rail Authority of NSW v Codelfa Construction Pty Ltd (1982) 150 CLR 29 at 38; [1982] HCA 51; Autodesk Inc v Dyason [No 2] (1993) 176 CLR 300 at 302- 303 per Mason CJ; [1993] HCA 6; De L v Director-General, NSW Department of Community Services (No 2) (1997) 190 CLR 207 at 215; [1997] HCA 14. 74 R v Bow Street Metropolitan Stipendiary Magistrate; Ex parte Pinochet Ugarte (No 2) [2000] 1 AC 119 at 132. 75 Nguyen v Nguyen (1990) 169 CLR 245 at 268-269; [1990] HCA 9. See also Ravenor Overseas Inc v Readhead (1998) 72 ALJR 671 at 672; 152 ALR 416 at 417; [1998] HCA 17; cf Garcia v National Australia Bank Ltd (1998) 194 CLR 395 at 418 [58]; cf 403 [17]; [1998] HCA 48; Farah Constructions Pty Ltd v Say dee Pty Ltd (2007) 230 CLR 89 at 151-152 [135]; [2007] HCA 22. 76 (1938) 60 CLR 431 at 437 referring to Halsbury's Laws of England, 2nd ed, vol 9 at 273 and the cases cited in note o). Kirby exception were hinted by Dixon J's observation that "… there is no English case in which, after such a determination, an appeal has been reopened or a fresh appeal has been entertained"77. However, the stated exception was not specifically disapproved. That fact has encouraged a recognition of similar exceptions both in statutory form78 and in judicial decisions79. The foundation for any such second exception is an assumption that, in such a case, the matter that has passed into judgment (as explained by the judicial reasons) did not decide a point in contention which therefore remains outstanding and undecided. Although, in the present case, the reasons of the Court of Criminal Appeal as first published appear to have determined all of Mr Burrell's grounds of appeal (as well as some which had been withdrawn) and to have done so on the merits as found, the hypothesis is that there has been no true determination of the appeal because of the inclusion of incorrect or immaterial factual propositions. This hypothesis shares some resonances with the postulate of "nullity" applicable to cases of jurisdictional error, as where an administrative decision- maker has failed to accord procedural fairness to a person affected by a decision80. Whilst this theory is inapplicable to a superior court of record, such as the Court of Criminal Appeal, the possible ingredients for a general principle to sustain exceptions to the Grierson principle begin to emerge. Although the general principle in Grierson has not been doubted by this Court since it was expressed, decisions of judges of this Court, in the intervening years, have raised the possibility that an intermediate appellate court could entertain an application to remedy a denial of procedural fairness "whether or not 77 (1938) 60 CLR 431 at 437. 78 See eg Uniform Civil Procedure Rules, rr 36.15(1), 36.16(2)(a), (b) and (c). 79 Jones v The Queen (1989) 166 CLR 409 at 414-415; Lapa (No 2) (1995) 80 A Crim R 398 at 403; Pettigrew v The Queen [1997] 1 Qd R 601; Saxon (1998) 101 A Crim R 71 at 76 per Wood J; R v Gust [2000] NSWCCA 287; R v Giri [No 2] [2001] NSWCCA 234 at [17] per Heydon JA. 80 See Minister for Immigration and Multicultural Affairs v Bhardwaj (2002) 209 CLR 597 at 612-613 [45]-[46] per Gummow and Gaudron JJ, 619-620 [68]-[70] per my own reasons; [2002] HCA 11. See also Calvin v Carr [1980] AC 574 at Kirby its order has been perfected"81. On the other hand, the most recent observations on the point by this Court in DJL v Central Authority82, in the context of the Family Court of Australia (a statutory federal court), appear hostile to the power of courts of record in Australia to reopen judicial decisions that have passed into judgment. It follows that the ultimate question in this appeal is therefore whether that general hostility governs the appeal, notwithstanding the practical realities that inform the context for the decision and given the ambit of already recognised exceptions to the general principle stated in Grierson83. legal principle applicable the A further exception to Grierson is not recognised A further exception?: From the foregoing analysis, it will be apparent that I do not find the issue presented by the first ground of appeal straightforward. In part, my hesitations may derive from differing conceptions of the role and functions of courts, such as the Court of Criminal Appeal; my view as to the consequential jurisdiction and powers of such courts; the large implied or inherent sources of power for those courts to do justice to cure promptly notified mistakes and oversights occasioning injustice; and the perception of rules governing the formal entering of judgments and orders as a means of contributing to the function of the courts of justice and not as impeding the correction of mistakes that may be difficult, or impossible, effectively to correct later and elsewhere. Nevertheless, the issue now before this Court is not one that arises on a blank page of legal doctrine. My duty is to give effect to the better view of the presently governing law. For several reasons, I have ultimately concluded that this duty leads to the same result as that reached in the joint reasons. I will now explain why. Duration of Grierson: The first point is that Grierson expresses a general principle that has endured for 70 years. It is addressed to the very statute in 81 Postiglione v The Queen (1997) 189 CLR 295 at 300 per Dawson and Gaudron JJ, 327 per Gummow J, 343 of my own reasons; [1997] HCA 26. 82 (2000) 201 CLR 226; [2000] HCA 17. 83 Another possible exception has been suggested for the case of interlocutory orders: see Allars, "Perfected judgments and inherently angelical administrative decisions: The powers of courts and administrators to reopen or reconsider their decisions", (2001) 21 Australian Bar Review 50 at 56. Kirby question in this appeal. Had the State Parliament considered that the Act should be changed to overcome any inflexibilities seen in the reasons in Grierson, for forbidding disturbance of entered orders of the Court of Criminal Appeal, it could easily have done so. No constitutional impediment stood in the way. It is not difficult to imagine the reasons that would have restrained any parliamentary re-expression of the Grierson principle in this context. The essence of a court of record is that it takes its record seriously. Decisions that pass into judgment thereupon speak to the whole world and not simply to the parties to the litigation. Most challenges against judgments entered by the Court of Criminal Appeal are likely to be by prisoners many of whom are unwilling to accept the conclusion of their contests by the orders of that Court. As the former Criminal Appeal Rules indicate by their language, there was originally a very particular reason for finality of such orders. This was the existence of the death penalty which, once executed, could not subsequently be reversed to the benefit of the prisoner. Although I accept that there have been dicta in this Court over the years expressing a willingness to contemplate further exceptions to the general principle in Grierson, I am bound to acknowledge that there have been just as many reaffirmations of that principle and of the legal policy that lies behind it. Thus, in Pantorno v The Queen84, Mason CJ and Brennan J explained that a particular reason for granting special leave to address a denial of natural justice conceded by the prosecution (arising from the failure of the Court of Criminal Appeal to address a point raised by the prisoner's grounds of appeal) was "the tacit assumption that the formal order of the Court of Criminal Appeal had been perfected so that there are now no means of remedying the position save an appeal to this Court"85. The postulate of a "further application to [the Court of Criminal Appeal]" was expressed by Deane, Toohey and Gaudron JJ in that case86. However, in view of the shortness of the sentence being served by the applicant for special leave in that case, their Honours agreed that it would be inappropriate to relist the matter for further argument so that "the validity of the assumption (about which we express no view) that the Court of Criminal Appeal now lacks jurisdiction could be examined". In that light, special leave was granted and the remedial orders made. 84 (1989) 166 CLR 466; [1989] HCA 18. 85 (1989) 166 CLR 466 at 474. See also Jones (1989) 166 CLR 409 at 415. 86 (1989) 166 CLR 466 at 484. Kirby At the very least, the continued operation of an almost unqualified principle of finality for orders of the Court of Criminal Appeal, entered in court records, has been a distinctive feature of the decisions of this Court. Grierson was referred to in the reasons of the plurality in DJL87. The reasoning and outcome in Grierson obviously influenced the approach that was given effect by the Court's orders in DJL. Although I expressed a different view concerning the power of the Family Court, that view did not prevail. The decision in DJL stands for the proposition that the Full Court of the Family Court does not have the jurisdiction or power to reopen final orders after their entry in the records of that Court88. Like the Court of Criminal Appeal, the Family Court is a superior court of record. Although the Family Court is a federal court, no constitutional or federal feature was propounded to distinguish it from the operation of the principle in Grierson89. Although I adhere to my contrary view, stated in DJL, in a matter such as this, I am obliged to give effect to the law as expressed by the majority. It is a law that affirms a literal application of the principle in Grierson, without any relevant exception. Distinguishing final courts: Despite the fact that an exception to the Grierson rule is now accepted for final courts, such as this Court, and although there are many practical features that equate Australia's intermediate courts, in terms of function, with the role of this Court, the decision in DJL rejects the proposition that the admission of an exception for a final court is applicable to the Full Court of the Family Court as an intermediate court90. Again, I am obliged to give effect to this majority conclusion, however much I might prefer the contrary view as more apparently realistic, just and functional91. Rejection of a further exception: In intermediate courts in this country too, a conflict of authority has emerged concerning the existence of an exception to permit correction of a mistake occasioning a miscarriage of justice which is brought to the notice of the intermediate court promptly. Some decisions appear 87 (2000) 201 CLR 226 at 245-246 [40] citing CDJ v VAJ (1998) 197 CLR 172 at 196; [1998] HCA 67. 88 (2000) 201 CLR 226 at 248 [46]-[47]. 89 (2000) 201 CLR 226 at 248 [46]-[47]. 90 (2000) 201 CLR 226 at 247 [43]-[44]. 91 (2000) 201 CLR 226 at 265 [96]-[97]. Kirby to uphold such a view92, usually in obiter dicta. However, other decisions reach the contrary conclusion. They hold that an exception permitting reopening of formalised orders of the Court of Criminal Appeal does not exist based on a conclusion of a denial of procedural fairness. Usually this opinion is expressed obiter93. It cannot be said that an assumption or practice has grown up in intermediate courts, that apply the template for criminal appeals, to the effect that the exception found by the Court of Criminal Appeal in these proceedings exists by convention or common application. A denial of the exception by this Court would not, therefore, appear to change the majority practice of such intermediate courts. Statutory reform and administrative practice: The rule in Grierson is, of course, liable to be reversed or qualified by laws made by or under statute. The adoption of new provisions in the Criminal Appeal Rules, following the second decision of the Court of Criminal Appeal in these proceedings94 was designed to permit that Court to set aside or vary an order within 14 days after the order was entered. This amendment to the Rules (assuming it to be valid) arguably amounts to an express recognition by the rule-maker that, absent such a rule, the Court of Criminal Appeal lacked the power that was then provided by the amendment. In any event, the basic source of the problem that arose in the present case was the over-rapid formalisation of the pronounced order dismissing Mr Burrell's appeal, by the conduct of the registry officer, on that very day, of issuing the Notification and entering the order in the way contemplated by the Criminal Appeal Rules. It was not essential, necessary or even desirable that that should be done so rapidly. Especially given the publication of extended reasons comprising nearly 130 pages and the desirable facility to parties to have an 92 Pettigrew (1996) 89 A Crim R 1; R v Gust (2000) NSWCCA 287; Saxon (1998) 101 A Crim R 71 at 76. 93 Lapa (No 2) (1995) 80 A Crim R 398; R v Reardon (2004) 146 A Crim R 475 at 487 [40] per Hodgson JA, 494 [81] per Simpson J, 501 [113] per Barr J. See also R v McNamara [No 2] [1997] 1 VR 257. 94 Criminal Appeal Rules as amended 7 September 2007 inserting r 50C. Rule 50C(3) provides that "[w]ithin 14 days after an order is entered, the Court may of its own motion set aside or vary the order as if the order had not been entered." Kirby opportunity to read, consider and draw any mistakes or misunderstandings to attention, there were many reasons why such an administrative practice was unsuitable. In a sense, it was this practice (inferentially alterable by specific or general directions of the judges) that brought about the entering of the Court's orders. Had that course not been followed, or had the Court of Criminal Appeal itself directed a delay in the formalisation of its orders when publicly pronouncing them, many (if not all) of the problems presented by this appeal could have been avoided. Conclusion: jurisdiction unavailable: In the result, the better view of the governing law is that there is no further exception to the principle in Grierson, applicable where a matter has been decided on the merits by the Court of Criminal Appeal where that decision has passed into judgment by being entered in court records in the manner contemplated by the Criminal Appeal Rules. It follows that the Court of Criminal Appeal erred in rejecting the submission for Mr Burrell, when the appeal was relisted, that it had no jurisdiction or power to recall its earlier decision or to reconsider or alter the orders previously pronounced and entered. That submission should have been accepted. The Court of Criminal Appeal should then have left any correction of the orders to this Court. In cases of clear mistake or oversight, at least where an arguable injustice had occurred, it might be expected in the future that the prosecution will, in proper cases, support the grant of special leave, and the making of orders setting aside the orders and judgment of the Court of Criminal Appeal and remitting the proceeding to that Court for fresh determination that can justly cure the demonstrated mistake or oversight. Having reached this conclusion, it is unnecessary for me, and would be undesirable, to consider the residual arguments of Mr Burrell, both in the appeal and in the application for extension of the grounds of special leave to appeal, referred into this Court. Orders The orders proposed in the joint reasons should be made.

HIGH COURT OF AUSTRALIA Matter No M156/2005 CELIA KATHLEEN CLAYTON APPLICANT AND THE QUEEN Matter No M157/2005 RESPONDENT APPLICANT AND THE QUEEN Matter No M158/2005 AND THE QUEEN RESPONDENT APPLICANT RESPONDENT [2006] HCA 58 Date of order: 9 August 2006 Date of publication of reasons: 13 December 2006 M156/2005, M157/2005 & M158/2005 ORDER In each matter, the application for special leave is dismissed. On appeal from the Supreme Court of Victoria Representation C B Boyce with J P Wheelahan for the applicant in Matter No M156/2006 (instructed by Patrick W Dwyer) L C Carter with M J Gumbleton for the applicant in Matter No M157/2006 (instructed by McNamaras) M J Croucher for the applicant in Matter No M158/2006 (instructed by Robert Stary and Associates) P A Coghlan QC with C M Quin for the respondent in all matters (instructed by Director of Public Prosecutions (Victoria)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Clayton v The Queen; Hartwick v The Queen; Hartwick v The Queen Criminal Law – Criminal liability – Complicity – Extended common purpose – Applicants carried out a common plan to assault victim, who died – Applicants tried together on counts alleging murder and assault – Prosecution could not identify which applicant inflicted fatal wound on victim – Bases on which murder left to jury included extended common purpose – Whether murder on the basis of extended common purpose should have been left to the jury – Whether extended common purpose a proper basis for conviction of murder. Criminal Law – Criminal liability – Complicity – Re-consideration of extended common purpose – Whether maintenance of extended common purpose as common law doctrine justified – Whether there is disconformity between legal and moral responsibility where conviction for murder is based on doctrine of extended common purpose – Whether extended common purpose imposes criminal liability without requiring proof of actual intent – Availability of verdict of manslaughter where murder by extended common purpose left to jury – Whether doctrine of extended common purpose adds undue complexity to trials – Necessity for trial judge to identify, and leave to jury, only the "real issues" of fact – Role of courts in altering law of homicide – Whether doctrine of extended common purpose should be re-expressed so as to replace "foresight of possibility" with "foresight of probability", or "want", or "virtual certainty" that the incidental crime would be committed. Words and phrases – "extended common purpose". Crimes Act 1958 (Vic), s 568(1). GLEESON CJ, GUMMOW, HAYNE, CALLINAN, HEYDON AND CRENNAN JJ. The applicants were presented for trial in the Supreme Court of Victoria on a single presentment alleging two counts against each: a count alleging the murder of Steven John Borg and a count of intentionally causing serious injury to Paula Michelle Rodwell. Each was convicted on both counts. Each sought leave to appeal to the Court of Appeal of the Supreme Court of Victoria against the convictions. The applications for leave to appeal against conviction on the second count (of intentionally causing serious injury) were allowed and a new trial ordered on that count1. Each application for leave to appeal against the conviction for murder was dismissed. The applicants sought special leave to appeal to this Court on a number of grounds. In so far as each applicant sought special leave to appeal on grounds which, in effect, invited the Court to reconsider its decisions in McAuliffe v The Queen2 and Gillard v The Queen3, the applications for special leave were referred for argument, as on an appeal, before the whole Court. In so far as the applications sought special leave to appeal on other grounds, they were dismissed. At the conclusion of oral argument on the grounds inviting reconsideration of McAuliffe and Gillard, the Court announced that the invitation to reconsider those cases was declined and ordered that each application for special leave be dismissed. It follows that intermediate and trial courts must continue to apply the principles established by those decisions. It also follows that it is neither necessary nor desirable to attempt to elaborate or explain those principles in any way. Nothing that is said in these reasons should be understood as doing so. Rather, what follows are our reasons for joining in declining to reconsider those cases and for making the orders that were made. It is necessary to say something about the facts of the case. Although the trial of the applicants lasted 46 days, it is possible to describe the essential facts of the matter quite shortly. 1 Hartwick, Clayton and Hartwick (2005) 159 A Crim R 1. (1995) 183 CLR 108. (2003) 219 CLR 1. Crennan The deceased, Mr Borg, had a relationship with Ms Rodwell, the alleged victim of the second count charged against the applicants. Mr Borg did not live with Ms Rodwell but was visiting her house when he met his death. The applicant Lisa Hartwick lived in the same street as Ms Rodwell. The applicants John and Lisa Hartwick had been married to one another but at the relevant time were divorced. Mr Hartwick often visited Ms Hartwick and stayed at her house. The other applicant, Ms Clayton, was a friend of Lisa Hartwick. The Hartwicks both knew Mr Borg and Ms Rodwell, but Ms Clayton had met Ms Rodwell only twice before the date of the offences and had never met Mr Borg. On the day Mr Borg died, Lisa Hartwick accosted Ms Rodwell and assaulted her saying, among other things, that she owed Mr Hartwick money and had accused Mr Hartwick of being a "dog", a police informer. Celia Clayton was present during these events. Lisa Hartwick, Celia Clayton and Ms Rodwell then went these matters up with Mr Hartwick. It was agreed that there had been a mistake, and the two women apologised to Ms Rodwell. to clear together Ms Rodwell went back to her house and told Mr Borg what had happened. He had consumed a quantity of drugs and he became very angry at the way she had been treated. He drove to Lisa Hartwick's house in a stolen car, accelerated into her driveway and smashed his car into the rear of Ms Clayton's rented car. That car was propelled into another that was parked directly in front of it. Both cars were seriously damaged, and some damage was done to the house. Mr Borg then returned to Ms Rodwell's house and, with her, consumed a cap of heroin. When the applicants discovered what had happened they became very angry and very agitated. There was evidence at trial that the applicants uttered various threats of violence against the person or persons responsible for the damage that had been done, and that these threats were uttered both before and upon arriving at Ms Rodwell's house. Who said what was a matter of dispute at trial. There was evidence at the trial that each of them armed himself or herself in some way before leaving Ms Hartwick's house. The weapons were variously described as including metal poles, wooden poles, and a large carving knife. Who had what weapon or weapons, and who knew what weapon or weapons were being carried (if any), were matters of dispute at trial. Ms Rodwell gave evidence of the applicants coming to the door of her house, assaulting her and one of them then detaining her at knifepoint while there Crennan was a prolonged assault on Mr Borg. The applicants disputed her account of what happened. But the injuries done to Mr Borg were consistent with her account of an attack lasting 30 to 40 minutes in which he was severely beaten with poles and stabbed a number of times. One of the stab wounds caused fatal injuries. The prosecution's case at trial was that, although it could not identify which of the applicants inflicted the fatal stab wound, each was guilty of murder. This contention was put in three ways. First, it was said that the killing occurred in the course of the applicants' implementation of a plan to cause really serious injury to the deceased. That is, the prosecution alleged that each applicant had participated in a joint enterprise. Alternatively, the prosecution argued that each applicant was guilty of murder because each had agreed to assault the deceased using weapons, and reasonably foresaw the possibility that death or really serious injury might be intentionally inflicted on the victim by one of them in the course of their carrying out the agreed assault. It is this second way of putting the case ("extended common purpose") that engaged the principles described in McAuliffe and Gillard. Finally, the prosecution argued that the two applicants who did not inflict the fatal wound had aided and abetted the person who did, by intentionally helping, encouraging or conveying their assent to that person in his or her commission of the murder. This third contention depended upon principles of accessorial liability. The prosecution accepted that if murder was not established, it would be necessary for the jury to consider manslaughter, but the principal contention advanced on behalf of the prosecution was that each applicant was guilty of murder on one or other of the three bases described. Questions of provocation were mentioned at trial but, in the end, no party asked for provocation to be left to the jury and it was not. Self-defence was in issue because there was evidence that the deceased was armed with a knife. It was necessary, therefore, at trial, to consider the possible application of a number of intersecting legal principles. The prosecution contended that three separate legal paths led to the conclusion that each applicant was guilty of murder. Each applicant contended that the prosecution had to disprove that he or she had acted in self-defence. And these legal principles were to be applied where there was much dispute about who had done what in the events culminating in Mr Borg's death. Questions of extended common purpose had to be considered at trial. The principles authoritatively established in McAuliffe and Gillard were to be applied Crennan both at trial and by the Court of Appeal and there was, and could be, no argument to the contrary. The applicants sought special leave to appeal to contend that those principles, which had to be applied in the courts below, should now be abandoned or at least substantially modified, presumably on the basis that "on any ground there was a miscarriage of justice"4. There are several reasons for the Court not to reconsider what was said in McAuliffe or Gillard about extended common purpose. First, contrary to the applicants' central submission, it is not demonstrated that the application of the principles stated in those cases has led to any miscarriage of justice in this case or, more generally, has occasioned injustice in the application of the law of homicide. The applicants pointed to no decided case said to reveal the alleged injustice. Rather, for the most part, the argument was advanced in a wholly abstract form. The applicants' contentions about "unjust" results, or results said to demonstrate disconformity between legal and moral responsibility, proceeded, in the main, from an unstated premise that the crime of murder should be confined to cases in which the accused intended the death of the victim. The allegation of injustice or disconformity, though variously expressed, fastened upon the fact that applying principles of extended common purpose could result in a person being found guilty of murder where that person did not agree or intend that death should result, but foresaw only the possibility that an assault with intent to kill or cause really serious injury might be made in the course of the joint enterprise. The applicants sought to compare this outcome with the case of a person assaulting another, knowing of the possibility, but not intending, that death or really serious injury might result. Such a person, the applicants submitted, would be guilty only of manslaughter. A person who does not intend the death of the victim, but does intend to do really serious injury to the victim, will be guilty of murder if the victim dies. If a party to a joint criminal enterprise foresees the possibility that another might be assaulted with intention to kill or cause really serious injury to that person, and, despite that foresight, continues to participate in the venture, the criminal culpability lies in the continued participation in the joint enterprise with the 4 Crimes Act 1958 (Vic), s 568(1). Crennan necessary foresight5. That the participant does not wish or intend that the victim be killed is of no greater significance than the observation that the person committing the assault need not wish or intend that result, yet be guilty of the crime of murder. Secondly, the applicants could point to no other court of final appeal accepting the proposition that the applicants put at the forefront of their submission, namely, that the doctrine of extended common purpose should be abolished or modified by replacing foresight of the possibility of a murderous assault with foresight of the probability of such an assault. Other common law countries continue to apply6 generally similar principles to those stated in McAuliffe and Gillard. Thirdly, if there are to be changes in this area of the law (and we are not to be taken as suggesting that there should be) there could be no change undertaken to the law of extended common purpose without examining whether what was being either sought or achieved was in truth some alteration to the law of homicide depending upon distinguishing between cases in which the accused acts with an intention to kill and cases in which the accused intends to do really serious injury or is reckless as to the possibility of death or really serious injury7. That is a task for legislatures and law reform commissions. It is not a step that can or should be taken in the development of the common law. The nature and extent of the difficulties that are encountered in adopting some other principle are revealed in the report of the United Kingdom Law Commission Inchoate Liability for Assisting and Encouraging Crime8. The Law Commission rejected a proposal to abolish what it described9 as secondary liability for a collateral offence committed in the course of a joint venture. 5 McAuliffe v The Queen (1995) 183 CLR 108 at 118; Gillard v The Queen (2003) 219 CLR 1 at 36 [112]. 6 See, for example, Chan Wing-Siu v The Queen [1985] AC 168; Hui Chi-ming v The Queen [1992] 1 AC 34; R v Powell [1999] 1 AC 1. 7 R v Crabbe (1985) 156 CLR 464. 8 United Kingdom, The Law Commission, Inchoate Liability for Assisting and Encouraging Crime, Law Com No 300, (July 2006) Cm 6878. 9 United Kingdom, The Law Commission, Inchoate Liability for Assisting and Encouraging Crime, Law Com No 300, (July 2006) Cm 6878 at 19 [2.24]-[2.25]. Crennan Further, no change could be undertaken to the law of extended common purpose without examining the whole of the law with respect to secondary liability for crime. The history of the distinction between joint enterprise liability and secondary liability as an aider, abettor, counsellor or procurer of an offence has recently been traced by Professor Simester10. As that author demonstrates11, liability as an aider and abettor is grounded in the secondary party's contribution to another's crime. By contrast, in joint enterprise cases, the wrong lies in the mutual embarkation on a crime, and the participants are liable for what they foresee as the possible results of that venture. In some cases, the accused may be guilty both as an aider and abettor, and as participant in a joint criminal enterprise. That factual intersection of the two different sets of principles does not deny their separate utility. Finally, it was submitted that the doctrine of extended common purpose should be discarded because it renders the trial of homicide too complex. The trial of these applicants was said to provide a good example of the complexities that arise. But upon examination, this trial does not support this particular criticism. In the present case, the trial judge gave the jury written directions upon which he elaborated by extensive oral directions. Unsurprisingly, the trial judge's written directions followed a pattern formed by the way in which the prosecution put its case. The jury were thus instructed in a way which assumed that each of the three arguments advanced by the prosecution should be considered separately. There was, therefore, a separate statement of each of the elements said to be necessary to establish the crime of murder according to whether there had been a joint enterprise, whether the applicants had been party to a common purpose such as engaged doctrines of extended common purpose, or whether the applicants who had not struck the fatal blow had nonetheless aided and abetted the person who had. These directions had to be overlaid with the need for the jury to deal with the questions about self-defence that were presented by the evidence. 10 Simester, "The Mental Element in Complicity", (2006) 122 Law Quarterly Review 11 Simester, "The Mental Element in Complicity", (2006) 122 Law Quarterly Review Crennan It may greatly be doubted that it was essential to identify the issues which the jury had to consider according to a pattern determined only by the legal principles upon which the prosecution relied. The written directions took that shape, but the oral directions focused more immediately upon the factual questions that arose. The real issues in the case12 which the jury had to decide were issues of fact. It was for the trial judge to determine what those real issues were and to instruct the jury about only so much of the law as must guide them to a decision on those issues. It may have been possible to instruct the jury in a way that avoided repetition of what, in the end, were relatively few issues for their consideration. The case against each applicant had to be considered separately. The injuries suffered by the deceased were consistent only with a prolonged assault upon him. There seemed little doubt that one of the applicants had inflicted the fatal wound. Because the prosecution did not contend that the evidence revealed who had struck the fatal blow, the principal issues in each case centred upon: (a) what did the applicant agree was to happen when they went to Ms Rodwell's house? (b) what did that applicant foresee was possible? and (c) what did that applicant do at the house, if anything, to aid and abet whoever it was who had fatally assaulted the deceased? If, as the prosecution contended was the case in respect of each applicant, the particular applicant under consideration was shown, beyond reasonable doubt, to have agreed with one or both of the other applicants to cause really serious injury to the deceased, a verdict of guilty of murder had to be returned. If the prosecution demonstrated beyond reasonable doubt that the applicant under consideration was party to an agreement with one or other of the applicants to assault the deceased to some lesser degree, and foresaw the possibility that death or really serious injury might intentionally be inflicted on the deceased in the course of that assault (otherwise than in self-defence), again, a verdict of murder 12 Alford v Magee (1952) 85 CLR 437 at 466. Crennan had to be returned. In this latter respect, if persuaded beyond reasonable doubt that the applicant concerned went to the premises armed, or knowing that others were going armed, it would be open to the jury to infer that that applicant foresaw the possibility of assault with the requisite intent, but such an inference was not inevitable. Finally, if the jury were persuaded beyond reasonable doubt that the applicant under consideration detained Ms Rodwell, knowing that Mr Borg was being assaulted with intent to kill or cause really serious injury, and that the applicant in question detained her to help or encourage the making of that assault, a verdict of murder had to be returned. There was a great deal of evidence that bore on these issues. Several different accounts had been given of what had happened before and during the fatal assault on Mr Borg, by the applicants when interviewed by police, by witnesses to what was said and done before the applicants arrived at Ms Rodwell's house, and by Ms Rodwell herself. And it was necessary for the judge to tell the jury what evidence was admissible against each applicant. But the issues (as distinct from the evidence) were relatively simple. What did the applicant agree was to happen; what did that applicant foresee might happen; what did that applicant do at the house? Applying the principles of extended common purpose did not require the over-elaboration or over-complication of the issues in this case. And the applicants offered no example of a case where it would. It is for these reasons that we joined in the orders that were made at the conclusion of oral argument. Kirby KIRBY J. Three applicants asked this Court to grant special leave to permit the simplification, rationalisation and re-expression of the Australian common law principles governing accessorial liability on the basis of an extended common purpose on the part of secondary offenders. The challenge has been anticipated for a time because of the injustice, asymmetry and complexity of the present law. It is a field "uncertain and controversial" and "notoriously difficult" that suffers from "incongruent principles" with consequent injustice13. In my view, the applications were entitled to succeed. The applicants should have been afforded relief. In his dissenting opinion in the Supreme Court of the United States in Bowers v Hardwick14, since overruled by Lawrence v Texas15, Blackmun J, in another legal context, stated: "The Court's cramped reading of the issue before it makes for a short opinion, but it does little to make for a persuasive one." Respectfully, that is my conclusion in the present case. Upon a full analysis of the detailed arguments of the parties, the applicants have made out their contentions. Special leave to appeal should have been granted. The appeals should have been allowed. The decisional background and history Convictions and appeals: Celia Clayton, John Hartwick and Lisa Hartwick (together "the applicants") applied to this Court seeking to challenge orders of the Court of Appeal of the Supreme Court of Victoria16. Those orders followed applications for leave to appeal to that Court against the convictions of each of the applicants for the murder of Steven John Borg ("the deceased") at Karingal, near Melbourne, on 23 May 2001. The Court of Appeal, constituted by Charles, Chernov and Nettle JJA, upheld the applicants' challenge to their concurrent convictions of intentionally causing serious injury to the deceased's friend, Ms Paula Michelle Rodwell. It set aside such convictions, ordered a retrial on those counts17 and varied the 13 Simester, "The Mental Element in Complicity", (2006) 122 Law Quarterly Review 14 478 US 186 at 202-203 (1986). 15 539 US 558 at 578 (2003). 16 R v Hartwick (2005) 159 A Crim R 1. 17 (2005) 159 A Crim R 1 at 50-53 [114]-[119]. Kirby sentences accordingly to a period of eighteen years imprisonment, with fourteen years non-parole period, in respect of the count of murder alone18. However, the Court of Appeal confirmed each of the convictions for murder. Those convictions had followed jury verdicts of guilty on the counts charging the applicants with the murder of the deceased. The guilty verdicts, in turn, followed directions given to the jury by the trial judge (Smith J). Such directions were in accordance with the authority of this Court in Johns v The Queen19, McAuliffe v The Queen20 and Gillard v The Queen21. Applications to this Court: Against the orders of the Court of Appeal disposing of the applications in respect of the murder convictions, the applicants made their applications to this Court. Those applications, mounted separately, raised several grounds. One issue, common to each of the three applications, was a request by the applicants that this Court should reconsider and re-express the law on extended common purpose liability for murder as stated in McAuliffe and as applied most recently in Gillard. It was that issue that the Special Leave Panel22 reserved to the Full Court. In my reasons in Gillard23, I noticed a number of doctrinal difficulties presented by the law of extended common purpose liability as stated in McAuliffe. I did so because the ultimate issue in Gillard was whether the trial judge had erred in failing to direct the jury as to the availability of a conviction of the appellant in that case of manslaughter. Despite arguably strong evidence exculpating Mr Gillard from the consequences of the intention of his co-offender to kill the deceased in that case24, if the principles in McAuliffe were applied in their full rigour, they appeared to leave little, if any, space for the conviction of Mr Gillard of manslaughter25. Nevertheless, in the end in Gillard, together with 18 (2005) 159 A Crim R 1 at 64 [163]. 19 (1980) 143 CLR 108. 20 (1995) 183 CLR 108. 21 (2003) 219 CLR 1. 22 Hayne and Heydon JJ. See [2006] HCATrans 331. 23 (2003) 219 CLR 1 at 16-17 [36]-[38]. 24 (2003) 219 CLR 1 at 22-23 [56]. 25 (2003) 219 CLR 1 at 25-26 [67]-[69]. Kirby the other members of this Court, I found a sliver of room for manslaughter26. I therefore joined in the orders for the retrial of Mr Gillard, made in that case. Challenges to McAuliffe and Gillard: In joining in the orders in Gillard, I expressed my unease that an opportunity had been missed in that appeal to re-examine McAuliffe and "to clarify and simplify the task of trial judges and the juries they instruct"27. The other members of this Court in Gillard applied the principles in McAuliffe without questioning them. In his reasons, Hayne J expressed the view that "[r]econsideration of McAuliffe [was] neither sought nor required"28. Gummow J expressed agreement with those remarks29. In these applications the issue presented tangentially in Gillard was squarely raised. The applicants, facing sentences of extended terms of imprisonment for murder, asked for leave to afford an opportunity to re-examine the law stated in McAuliffe and Gillard. It is that question that the Special Leave Panel referred to a Full Court for decision. The three applications were consolidated and returned for hearing before the entire Court, sitting in Adelaide. Whilst advancing certain individual arguments appropriate to the case of each applicant, counsel substantially shared the common attack on what they suggested were the defects of justice, logic and rationality in the legal rule expressed in both McAuliffe and Gillard. At the conclusion of the oral argument, the Court adjourned briefly and then announced its refusal to reconsider the authority stated in the two cases. An order was made dismissing the three applications. The Court's reasons for adopting this course were reserved. At the conclusion of the oral argument, I preferred to avail myself of the opportunity to reflect on the applications and the arguments advanced for and against them. My own preference in this respect could not delay the orders of the Court, my colleagues being firm in their conclusions and proposed orders. I have taken time for study and reflection before reaching my conclusions and stating my reasons and orders. Upon further consideration, it is my view that the applicants were entitled to succeed. The time has come to re-express the Australian law of extended common purpose liability so as, at least in homicide cases where those rules are most important, to restore greater concurrence between moral culpability and criminal responsibility; to reduce doctrinal 26 (2003) 219 CLR 1 at 27-31 [74]-[87]. 27 (2003) 219 CLR 1 at 22 [54]. 28 (2003) 219 CLR 1 at 36 [113]. 29 (2003) 219 CLR 1 at 15 [31]. Kirby anomalies and asymmetries; and to reduce the risk of miscarriages of justice in the applicants' particular cases arising from the application of the law as hitherto expressed. Need to explain the challenges: Without explaining the factual background of the applications in greater detail, their merits may not be fully understood. Without recounting the arguments that the applicants deployed, the disposition that I favour will not be appreciated. Without illustrating the serious doctrinal weaknesses of the comparatively recent expressions of the law on extended common purpose, the reasons for favouring re-expression will not be perceived. Without recounting the past failures of others to repair the defects in this branch of the law, the necessity for this Court to accept its own responsibility for re-expressing the common law, shown to be defective, will not be accepted. Although, therefore, my reasons constitute a minority opinion, out of fairness to the arguments of the applicants and to those who in the future, in different times, may return to this issue, I will explain, with no more detail than necessary, my differing opinion and conclusion. When a like question was before the House of Lords in 1997, in R v Powell30, two of their Lordships31 specifically acknowledged the anomalies in the law of homicide now complained of in these applications; the need to address such anomalies; and the hope that the legislature would do so. While acknowledging the capacity of the legislature to rectify such defects in the law, on reflection I have concluded that no further delay should be tolerated. This part of the common law is in a mess. It is difficult to understand. It is very hard to explain to juries. It involves a portion of the law made by judges. What the judges have expressed with imperfect results, they can re-express with greater justice and rationality in the light of experience and the submissions in this case32. Ultimately, in expressing and applying the common law in Australia, that is the responsibility of this Court33. It is a responsibility that we should be ready to shoulder in these proceedings. The facts Background facts: Some of the background facts leading to the death of the deceased are set out in the reasons of the other members of the Court ("the 31 [1999] 1 AC 1 at 11 per Lord Mustill, 14-15 per Lord Steyn. See also at 25 per Lord Hutton. 32 cf Chamberlains v Lai [2006] NZSC 70 at [94] per Elias CJ, Gault and Keith JJ. 33 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 565-566. Kirby joint reasons")34. As to the main facts, there was no dispute. However, as to particular facts, relevant to the respective parts played by each of the applicants in the assaults upon, and ultimate fatal stabbing of, the deceased, there were differences in the versions given by the respective applicants in their records of interview with the police. None of the applicants gave oral evidence before the jury. The jury therefore had to rely, substantially, on the applicants' several video-tape recorded interviews with the police. In this Court, the parties relied on the factual background as summarised by the Court of Appeal35. That Court, in turn, drew upon the police interviews and the other evidence adduced at the trial. The applicants also sought to supplement the summary of the Court of Appeal with the summary of the findings of fact given by Smith J in his reasons for sentence36. Differential facts: One of the complaints advanced by the applicants against the law of extended common purpose, as stated in McAuliffe and Gillard, was that it excludes the jury from the requirement, and responsibility, of differentiating the moral culpability of each criminal accused, so as to determine their separate, respective responsibilities for the offence in issue. Typically, in homicide cases, any suggested disparity in the moral culpability of accused, alleged to have acted in common, arises from what is claimed to be an unpredicted, unexpected and unwished-for introduction by one of the accused of a weapon, later used to kill the deceased37. Essentially, the applicants complained that this Court's doctrine of extended common purpose unjustly encourages juries to lump all accused together, finding them all equally guilty but without addressing in a more precise way, as is usual for criminal punishment, the individual responsibility of each for the acts proved against them severally. According to the applicants, the present approach has led to lazy and unprincipled determinations. Such an approach, particularly in homicide cases where the doctrine is specially important, works injustice and departs from the basic principles of criminal responsibility now accepted in our law. 34 Joint reasons at [4]-[10]. 35 Hartwick (2005) 159 A Crim R 1 at 5-8 [3]-[8]. 36 R v Hartwick, Hartwick and Clayton [2003] VSC 63 at [19]-[28]. 37 This was the situation in the two cases considered in Powell [1999] 1 AC 1 and in the case presented in Gillard (2003) 219 CLR 1. See also R v Gamble [1989] NI 268 described in Powell [1999] 1 AC 1 at 28-30. Kirby In the applicants' joint trial, the prosecution did not prove which of the applicants had actually administered the fatal knife wound to the deceased38. In the way the trial was conducted, it was virtually certain that it was one of the applicants. However, because of the ambit of the present extended common purpose doctrine, the applicants were each liable to be found guilty of the murder of the deceased. This was so, although the jury might, if they had been required to do so, have decided that one, two or all three of the applicants had not actually intended the deceased's death or had not regarded it as a virtually certain39 or a "probable"40 outcome of participating with the others in the shared purpose they actually had when they engaged in their activity in common. Given that this complaint goes to the heart of the present applications, it is appropriate to say a little more about the factual details and the part that each applicant took in the events leading to the deceased's death, as disclosed by the evidence. The deceased had crashed a stolen car into a car rented by Ms Clayton which had been parked outside Mrs Hartwick's home in Karingal. The collision pushed Ms Clayton's car into another car, which in turn collided with the front wall of Mrs Hartwick's house, causing much damage41. None of the applicants actually saw the deceased driving the offending vehicle42. Nevertheless, they assumed that the incident was connected with an earlier altercation between Mrs Hartwick and Ms Rodwell (the deceased's domestic partner). That altercation had initially arisen out of a belief by Mrs Hartwick that Ms Rodwell had accused Mr Hartwick (Mrs Hartwick's ex-husband) of being a "dog", ie a police informer43. 38 Hartwick (2005) 159 A Crim R 1 at 7-8 [8]. 39 The test propounded by the late Professor Sir John Smith, "Criminal Liability of Accessories: Law and Law Reform", (1997) 113 Law Quarterly Review 453 at 465. See below at [122]. 40 This test bears some similarity to the test applied in the Australian Code States. See Darkan v The Queen (2006) 80 ALJR 1250 at 1257-1260 [29]-[40], 1266-1267 [77], 1273-1274 [124]-[126]; 228 ALR 334 at 341-345, 353, 363. See below at 41 Hartwick (2005) 159 A Crim R 1 at 5-6 [4]; R v Hartwick, Hartwick and Clayton [2003] VSC 63 at [20]. 42 [2003] VSC 63 at [20]. 43 (2005) 159 A Crim R 1 at 5-6 [4]; [2003] VSC 63 at [20]-[21]. Kirby Following the initial altercation, Mr Hartwick informed Mrs Hartwick that her belief in this respect had been mistaken and that it was the deceased, not Ms Rodwell, who had made the objectionable allegation44. This news led to the apparent conclusion of the dispute with Ms Rodwell. But when, shortly afterwards, the car crash occurred, the inference that the deceased had caused it, in retaliation for the earlier confrontation with Ms Rodwell, was inescapable. The three applicants became "very angry and agitated"45. A neighbour said that she saw both Mr Hartwick and Ms Clayton leaving Mrs Hartwick's house with a knife. Another described the two women applicants as angry, with Mr Hartwick telling them to "calm down" and promising that he would "sort it out"46. For the purposes of sentencing the applicants, following the jury verdicts and their convictions of murder, the trial judge made a number of findings upon which the Court of Appeal was also prepared to act47. These included that, within thirty minutes or so of the car crash, the applicants drove to Ms Rodwell's house with the intention of assaulting the deceased. They had with them at least one knife and some poles48 (variously described as a vacuum cleaner pipe, a shopping trolley handle and a wooden cricket stump49). They demanded entry to the house where Ms Rodwell and the deceased had just consumed a cap of heroin50. On Ms Rodwell's urgings, the deceased temporarily left the premises by the back door51. When Ms Rodwell opened the front door of the house, Ms Clayton struck her on the head with one of the poles52. This incident was the subject of the second count of the presentment upon which each of the applicants was also found guilty by the jury and convicted but in respect of which the convictions were quashed and a new trial ordered. 44 (2005) 159 A Crim R 1 at 5-6 [4]; [2003] VSC 63 at [20]-[21]. 45 (2005) 159 A Crim R 1 at 6 [5]. 46 (2005) 159 A Crim R 1 at 6 [5]. 47 [2003] VSC 63 at [19]-[28]; (2005) 159 A Crim R 1 at 5-7 [3]-[8]. 48 [2003] VSC 63 at [22]. 49 (2005) 159 A Crim R 1 at 6-7 [6]. 50 (2005) 159 A Crim R 1 at 5-6 [4]. 51 [2003] VSC 63 at [23]; (2005) 159 A Crim R 1 at 7 [7]. 52 [2003] VSC 63 at [23]; (2005) 159 A Crim R 1 at 7 [7]. Kirby Inside the house, Ms Rodwell was held at knife-point throughout most of what ensued either by Ms Clayton or Mrs Hartwick. At various times, Mrs Hartwick and Mr Hartwick attempted to stem the bleeding from the wound received by Ms Rodwell when she was struck on the head53. Mr and Mrs Hartwick went through the house looking for the deceased and searching for items of value, inferentially to compensate them for the damaged vehicles and premises54. It was when they were so engaged that the deceased suddenly re-appeared. He was armed with a knife. A struggle ensued in which the deceased was severely beaten with the poles. Five of his teeth were knocked out. His left ear was almost severed. According to Ms Rodwell, the deceased and Mr Hartwick were observed attempting to "dag" (stab) one another55. Mr Hartwick called for assistance from his fellow intruders. It was at some stage during the ensuing mêlée that the deceased was fatally stabbed on the left side of his chest. His heart and lung were punctured by the knife56. Mr Hartwick was also stabbed, possibly by the deceased but, according to Ms Rodwell, by Mrs Hartwick, as a result of an accident57. The applicants took items from the deceased's pockets including money and cannabis. Mrs Hartwick made some effort to remove identifiers of the presence of the applicants at the scene of the crime. The three applicants then decamped leaving Ms Rodwell alone with the deceased's body58. Differential cases: Although the broad outline of what happened, thus described, was clear enough, the respective records of interview introduced differential assertions of culpability on the part of each of the applicants. In her interview, Ms Clayton said that, whilst she had accompanied the others to Ms Rodwell's home, her role was largely that of a look-out whilst the others were engaged in ransacking the premises. Ms Clayton said that throughout the event, she was holding a knife at Ms Rodwell's throat whilst the latter was seated on a couch beside her. She said that she knew that the deceased was receiving a severe beating. However, she claimed that she did not fully appreciate what the others were doing to the deceased, that resulted in his death. 53 [2003] VSC 63 at [23]; (2005) 159 A Crim R 1 at 7 [7]. 54 [2003] VSC 63 at [25]; (2005) 159 A Crim R 1 at 7 [7]. 55 [2003] VSC 63 at [25]; (2005) 159 A Crim R 1 at 7 [7]. 56 [2003] VSC 63 at [25]; (2005) 159 A Crim R 1 at 7 [7]. 57 (2005) 159 A Crim R 1 at 7 [7]. 58 (2005) 159 A Crim R 1 at 7 [7]. Kirby Armed with the present statement of the law on extended common purpose, the prosecution argued before the jury that Ms Clayton was guilty of murder on the basis of her own statements to the police. This was so, notwithstanding her claim that she had taken no part in the fatal stabbing; had no intention to participate in violence of that degree; no actual participation in the physical attacks on the deceased; and no involvement in the ultimately fatal act of stabbing the deceased. Mr Hartwick's record of interview was more guarded. He also denied that he was guilty of murder. Initially, he said that he believed that the police had got the wrong people. However, although he never admitted to being in the premises where the deceased was killed, his defence at the trial was conducted on the basis that he was present when the deceased was attacked. His essential case was that he did not stab the deceased; did not have any weapons; and had no intention to kill or inflict really serious injury on the deceased. To the contrary, he was the "peace maker who wanted to sort things out". Mr Hartwick attended the Frankston Hospital for treatment for his own stab wounds. It was argued that, if he had had anything to hide, he would not have done this. He claimed that he did not at first realise that he had been stabbed. Additionally, Mr Hartwick relied on Ms Rodwell's evidence of the "dagging" fight. On the basis of this evidence, he claimed that, if it was he who had stabbed the deceased, he only did so in self-defence which the prosecution had failed to exclude as the cause of the fatal stabbing. Mrs Hartwick's case was also substantially contained in her record of interview with police. She claimed that she had accompanied Mr Hartwick and Ms Clayton after the car crash because, otherwise, she would have been bashed by Mr Hartwick. She claimed not to have known that Ms Clayton had a knife with her until after she had seen it when Ms Clayton struck Ms Rodwell as she opened the door of her home. Mrs Hartwick said that she had stayed near the door throughout most of the ensuing events, although at one point she had obtained a towel for Ms Rodwell because she was bleeding from the head. She described how the deceased had suddenly "come from nowhere" and stabbed Mr Hartwick, leading to the scuffle between the two men. She described how Ms Clayton became involved in that scuffle and denied that she had assaulted or touched the deceased in any way. She admitted that she and Ms Clayton had driven to her home together after the fatal stabbing and that Mr Hartwick had returned there separately. He and Ms Clayton had asked her to clean two knives, which she did. One of these was a knife from her own house which, by then, she understood to have been in Ms Clayton's possession. The other knife she understood to have been in the deceased's possession. According to Ms Rodwell, Kirby when the applicants were leaving the scene of the crime, Mrs Hartwick had said to her "You know the rules – no dogging"59. The prosecution case: In respect of the first count of the presentment (murder) the prosecution accepted that it could not prove which of the applicants had inflicted the fatal stab wound on the deceased. However, according to the prosecution, as a matter of law, that incapacity did not matter. Each of the applicants was guilty of murder equally with the others. This submission was advanced upon the basis of the three legal principles on which the prosecution relied to inculpate in the killing of the deceased whichever of the two applicants who were not involved in the fatal blow, equally with whichever applicant actually stabbed the deceased. The prosecution advanced three bases to establish liability for murder as equal possibilities60: The first basis was that the applicants were each acting in concert. In particular, the prosecution submitted that each of the applicants had gone to Ms Rodwell's home with the agreement and intention to inflict really serious injury on the deceased and that, pursuant to this agreement, the deceased was stabbed with the intention of causing such really serious injury61. The prosecution did not submit that the three applicants left Mrs Hartwick's home actually intending to kill the deceased. Having regard to the evidence adduced at the trial, the prosecution accepted that such a conclusion would be unrealistic62. However, to obtain convictions of murder for acting in concert, it was enough if the jury concluded that the applicants had gone to confront the deceased and to inflict on him really serious injury. That, it was argued, the prosecution had proved to the requisite standard; The second basis relied on extended common purpose liability. Amongst other ways, this ground of accessorial liability was advanced on the footing that the applicants had agreed to assault the deceased with a weapon or weapons and that each of them "foresaw as a possibility in the carrying out of the agreed understanding or arrangement that death or really serious injury would occur by a conscious, voluntary and deliberate 59 (2005) 159 A Crim R 1 at 7 [7]. 60 See (2005) 159 A Crim R 1 at 7-8 [8]. 61 See (2005) 159 A Crim R 1 at 7-8 [8]. 62 [2003] VSC 63 at [2]. Kirby act of one of them not done in self defence"63. This argument affords the suggested foundation for the jury's verdicts that the applicants challenged in these applications; and The third basis was aiding and abetting. Amongst other ways in which this basis of liability was put, the prosecution claimed that each applicant was present when the deceased was stabbed and each was "aware that the Deceased was being consciously, voluntarily and deliberately assaulted with intent to kill or cause really serious injury and not in self-defence" and that each applicant "intentionally helped the stabber to commit the crime"; or "intentionally encouraged" him or her by words, presence or behaviour; or "intentionally conveyed" to him or her "assent to or concurrence in the commission of the crime"64. The emerging issue of responsibility: From the foregoing description of the three ways in which the prosecution separately urged the jury to find each of the applicants (including those who had not inflicted the fatal stab wound on the deceased) guilty of murder, it will be noticed that there is an important distinction between the second and the other two propounded bases of legal liability. To secure a conviction of murder on the basis either of the jury's conclusion that the applicants had acted in concert, or were guilty of aiding and abetting whichever one of them actually inflicted the fatal wound, an ingredient of legal liability in each case was the jury's satisfaction, beyond reasonable doubt, of the requisite "intention" of each accused. By way of contrast, to secure a conviction on the basis of the extended common purpose of the three accused, the prosecution was not obliged to establish a relevant specific intention. It was sufficient that the prosecution should establish something short of intention on the part of each applicant for a verdict of guilty of murder to be returned. It was enough if the jury concluded that each applicant foresaw the possibility that death or really serious injury would occur from the deliberate act of one of them. This feature of extended common purpose liability (in this case for the crime of murder) involves an important distinction, both in law and on the facts. It highlights the contested ways in which the prosecution case against the applicants was presented on the basis of extended common purpose liability, on the one hand, and alleged acting in concert or aiding and abetting the principal offender (whoever that might have been), on the other. The form of the case 63 Written directions provided by Smith J to the jury, DPP Exhibit 22 (emphasis added). 64 DPP Exhibit 22. Kirby brought in respect of the two latter charges is more consonant with the usual principles of criminal liability recognised by our law. Because the verdicts of the jury in the trial of the applicants did not differentiate the foundation upon which the jury convicted each of the applicants, it is impossible for this Court to exclude the available inference, on which each of the applicants relied, that the jury could have proceeded to determine the liability of each applicant by the easiest, and most readily proved, of the bases which the prosecution had advanced65. Because that inference could not be excluded, it was necessary, in assessing the applicants' common legal challenge before this Court, to assume the jury might have proceeded to decide the guilt of the applicants of the crime of murder by applying the stated law on extended common purpose liability. The applicants complained that this illustrated the injustice involved in the disharmony between the establishment of criminal responsibility on the basis of extended common purpose and doing so on the prosecution's other proposed bases of accessorial liability. This was particularly unjust where, to secure conviction, it was enough for the prosecution to prove that each applicant merely foresaw what happened as a possibility in carrying out the common understanding. Anything is possible, the applicants submitted. Why, they asked, should they be convicted of murder not on the basis of their proved individual intentions but on the basis of estimations of possible foresight of eventualities that had certainly transpired? The unedifying circumstances: The facts that I have earlier described, leading to the violent death of the deceased, present an unedifying story of anger and violence. None of the applicants emerges from the story with much credit. It is understandable that their appeals to legal principle and to the correct legal doctrine might occasion a degree of impatience and an intuitive feeling that the applicants deserve little sympathy. However, that is not the way the criminal law functions in Australia. Often, important principles are established in cases involving unattractive individuals and confronting facts. It is when the law deals with such cases and such individuals that it is tested for its adherence to basic principle66. Having been found guilty together, the applicants were each convicted of murder and sentenced to very lengthy terms of imprisonment. Their counsel have argued the point of legal principle which they advanced in this Court. They have asked this Court to re-express the applicable rules as to accessorial liability 65 cf Domican v The Queen (1992) 173 CLR 555 at 566-567. 66 cf Adelaide Company of Jehovah's Witnesses Inc v The Commonwealth (1943) 67 CLR 116 at 124. Kirby in their case and, hence, for the many others which (as the facts of Gillard67 illustrate) may occasion an even greater sense of individual injustice over the outcome that follows from the present expressions of the law on extended common purpose liability. For England, the House of Lords, in Powell, addressed many of the issues argued in these applications in a hearing that lasted three days. The appeal was relisted for orders five months later. Their Lordships delayed the publication of their speeches for a further three months. Their reasons reveal a full awareness of the legal anomalies and asymmetries that were at stake68. For the justice and integrity of the common law of Australia, this Court should be no less attentive to the detailed arguments that the applicants have urged upon us. The issues Three issues were presented in these applications. They are: Reconsideration of extended common purpose: Should this Court re-express the Australian common law with respect to the doctrine of extended common purpose liability in the criminal law? Is such re-expression required or appropriate having regard to the comparatively recent statements of this Court on the subject in McAuliffe and Gillard? If anomalies, inconsistencies and asymmetries of legal doctrine are revealed, is the present expression of the principle sustainable as a practical rule of accessorial liability, apt to circumstances such as the instant case? If convinced that re-expression of the law is required, should this Court leave any such re-expression to the legislature, assisted by law reform or like bodies? Or should it perform the re-expression in discharge of its own functions as the final national court of appeal entrusted with stating, and where necessary re-expressing, the basic principles of the common law applicable throughout Australia? Re-expression of the doctrine: If it is concluded that the defects in the extended common purpose doctrine are such as to justify, and require, a re-expression by this Court of the applicable rule of the common law, 67 (2003) 219 CLR 1 at 22-23 [56]. 68 [1999] 1 AC 1 at 1-10. Their Lordships heard the appeals in February 1997. They pronounced their orders in July 1997. They published their reasons on 30 October 1997; cf Kitto, "Why Write Judgments?", (1992) 66 Australian Law Journal 787 at 792; NAIS v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 80 ALJR 367 at 380 [59]; 223 ALR 171 at 184-185; Hadid v Redpath (2001) 35 MVR 152 at 163-164 [51] per Heydon JA. Kirby should the re-expression state that to secure convictions of co-accused on the basis of an alleged common purpose, the prosecution must prove that the secondary offender, which it seeks to render liable equally with the principal offender, desired the latter to act with the intention that he or she did, or knew that it was "not merely a 'real possibility' [that the primary offender might do so] but virtually certain that he would do so"69? Or should any such statement render the secondary offender equally liable with the primary offender on the ground of extended common purpose with the primary offender, only if the prosecution proves that the secondary offender foresaw as a probability, in the carrying out of the agreed understanding or arrangement, that death or really serious injury would occur by the act of one of them70? (3) Disposition of the appeals: If it is concluded that the liability of co- accused on the basis of extended common purpose at common law should be re-expressed, what dispositions should follow in these proceedings: The setting aside of the applicants' convictions and the ordering of a retrial on the counts of murder (as the applicants each sought); or The setting aside of the orders of the Court of Appeal dismissing their appeals and the remitter of the proceedings to the Court of Appeal for disposal by that Court in the light of the re-expression by this Court of the common law; the consideration of the application of such law in the applicants' respective cases; and also the consideration of whether the applicants' convictions ought nonetheless to be confirmed by the application of the "proviso"71, having regard to the principles explained by this Court in that respect in Weiss v The Queen72? Justification and maintenance of extended common purpose liability Justification of the doctrine: Before this Court, the prosecution rejected the applicants' criticisms of the doctrine of extended common purpose. It defended that doctrine as a long-standing feature of the common law of 69 Smith, "Criminal Liability of Accessories: Law and Law Reform", (1997) 113 Law Quarterly Review 453 at 465 (original emphasis). 70 cf R v Crabbe (1985) 156 CLR 464. 71 Crimes Act 1958 (Vic), s 568(1). 72 (2005) 80 ALJR 444 at 452-456 [31]-[47]; 223 ALR 662 at 671-675. Kirby Australia. However, the oldest authority in this Court cited by the prosecution in support of that proposition was decided as recently as 198073. In fact, as Sir Robin Cooke pointed out, giving the advice of the Privy Council in Chan Wing-Siu v The Queen74, a Hong Kong appeal, the need to express the test for such liability more elaborately in terms that a jury would have to apply came about "in association with the modern emphasis on subjective tests of criminal guilt". The traditional expression of the test for such liability had originally been voiced in objective terms. It is in those terms that the test found its way into the Queensland Criminal Code drafted by Sir Samuel Griffith75. The current law on the subject is thus scarcely a law of great antiquity. Nevertheless, the prosecution emphasised that the Australian law on extended common purpose liability had been stated76, reaffirmed77 and recently reapplied78 by this Court in unanimous decisions. The starting point for the applications was thus from a position where the applicable authority was abundantly clear. The prosecution submitted that, to abolish, or modify, the doctrine of extended common purpose, so stated, would, to the extent that this course was attempted, unsettle the present law in a way that could not be justified. Viewed from its interests, the prosecution's defence of the present law was vigorous and understandable. As expressed in McAuliffe and later cases the impugned law is highly favourable to the prosecution. In instances involving multiple offenders acting to some extent in concert, it eases the path to securing 73 The prosecution relied on Johns (1980) 143 CLR 108. In Johns, at 122, 130-131, this Court approved a statement as to accessorial liability expressed by Street CJ in the Court of Criminal Appeal of New South Wales in that case in terms of "an act contemplated as a possible incident of the originally planned particular venture" (emphasis added). Of course, forms of secondary liability long pre-dated Johns and have been traced to Bracton and the Statute of Westminster of 1275: see Simester, "The Mental Element in Complicity", (2006) 122 Law Quarterly Review 74 [1985] AC 168 at 176. 75 See Criminal Code (Q), ss 7, 8 and 9; Darkan (2006) 80 ALJR 1250 at 1261-1262 [49]-[50], 1274 [125]; 228 ALR 334 at 346-347, 363. 76 In Johns (1980) 143 CLR 108. 77 In McAuliffe (1995) 183 CLR 108. 78 In Gillard (2003) 219 CLR 1. Kirby the conviction of all participants, without irksome differentiation between them or troublesome attention to what the prosecution has actually proved about the acts and intentions of each of the individuals accused. The prosecution justified this approach on the basis that it tendered a realistic criterion for criminal liability of those who become involved in common criminal enterprises of the kind illustrated by the facts of this case. Secondly, whilst accepting that extended common purpose liability did not require proof of actual common intention (or even actual foresight of the virtual certainty or probability of what in fact occurred) the prosecution emphasised that the requisite foresight nonetheless imposed a type of subjective criterion, albeit one that needed only to be proved to the level of a "possibility". In order to obtain an accessory's conviction, it still remains for the prosecution to establish beyond reasonable doubt that the secondary offender agreed to take part in a criminal enterprise; that he or she participated or continued to participate despite being aware that, in carrying out the agreed enterprise, it was possible that another participant might commit the more serious crime; and that to be found guilty as an accessory to murder, it was necessary for all elements of the crime to have been established in the course of carrying out the criminal enterprise. This meant proving that the principal offender must have acted with the necessary intent, in a case such as the present, to kill the victim or cause really serious injury to the victim79. The prosecution submitted that these remained rigorous requirements which could be safely left to the good sense of jury determination. It suggested that some of the criticisms voiced by the applicants were more theoretical than real80. Thirdly, the prosecution contested that there were anomalies in the doctrine of extended common purpose which necessitated a re-expression of the law to make its operation more principled, simpler, and fairer for all concerned. Thus, the prosecution laid emphasis on the requirement that, in every case, it must prove beyond reasonable doubt that there was an agreement to participate in a criminal enterprise. It submitted that this was such a fundamental element of liability that comparison with other forms of criminal complicity, absent that factor, was illogical and unhelpful. Whilst this is a fair deployment of rhetoric by the prosecution, its force breaks down somewhat when the content of the agreement is explored. Thus, it might have been an agreement to attack another person. Typically in cases of 79 Gillard (2003) 219 CLR 1 at 11-12 [19]-[20], 13-14 [25]-[26], 28-29 [78]-[79]. See also Powell [1999] 1 AC 1 at 12 per Lord Steyn. 80 cf Powell [1999] 1 AC 1 at 12 per Lord Mustill, 25 per Lord Hutton. Kirby homicide, the problem for joint liability is presented when one participant to the common purpose goes much further than the others say they desired, anticipated or expected. The question then for consideration is whether, in such circumstances, by a kind of legal fiction, the law should attribute to the secondary participant equal liability for the outcome of the criminal enterprise, although that outcome was never in fact desired, anticipated or expected by the secondary offender but only by the principal. Fourthly, the prosecution supported the present law of extended common purpose liability by reference to policy arguments addressed to the desirability of discouraging gangs and other persons acting in common participating in criminal enterprises which have a nasty tendency to escalate and go wrong81. Certainly, this was an important consideration in dissuading the House of Lords from re-expressing the English law in this respect, although their Lordships acknowledged anomalies, lack of symmetry and other defects in the resulting law82. Thus, in Powell83, Lord Hutton said: "I recognise that as a matter of logic there is force in the argument advanced on behalf of the appellants, and that on one view it is anomalous that if foreseeability of death or really serious harm is not sufficient to constitute mens rea for murder in the party who actually carries out the killing, it is sufficient to constitute mens rea in a secondary party. But the rules of the common law are not based solely on logic but relate to practical concerns and, in relation to crimes committed in the course of joint enterprises, to the need to give effective protection to the public against criminals operating in gangs."84 A similar explanation is given by A P Simester and G R Sullivan in their text Criminal Law Theory and Doctrine85. Responding to the anxieties voiced by some of their Lordships in Powell, the authors express doubt that it is possible to "distinguish so readily between matters of intelligence and those of practicality". They offer their own justification for treating common criminal liability for the outcomes of a joint enterprise as "a special case of complicitous participation and 81 Powell [1999] 1 AC 1 at 25 per Lord Hutton with whom the other Law Lords agreed: Lord Goff of Chieveley at 10, Lord Jauncey of Tullichettle at 10, Lord Mustill at 12, and Lord Steyn at 15. 82 Powell [1999] 1 AC 1 at 12 per Lord Mustill, 13 per Lord Steyn. 83 [1999] 1 AC 1 at 25. 84 His Lordship referred to R v Majewski [1977] AC 443 at 482 per Lord Salmon. 85 Simester and Sullivan, Criminal Law Theory and Doctrine, 2nd ed (2003) at 221. Kirby not merely a sub-species of assistance and encouragement"86. They support the stance of the law expressed in Powell (affirmed for Australian purposes by the then recent decision of this Court in McAuliffe87) in these terms88: "The law has a particular hostility to criminal groups: conspiracy to defraud, for example, is an offence even where individual fraud is not. As with the inchoate crime of conspiracy, the rationale is partly one of dangerousness: 'experience has shown that joint criminal enterprises only too readily escalate into the commission of greater offences.'89 Criminal associations are dangerous. They present a threat to public safety that ordinary criminal prohibitions, addressed to individual actors, do not entirely address. Moreover, the danger is not just of an immediately physical nature. A group is a form of society, and a group constituted by a joint unlawful enterprise is a form of society that has set itself against the law and order of society at large. Individuals offending alone do not do this. Thus concerted wrongdoing imports additional and special reasons why the law must intervene." This argument represents the strongest policy justification for the exceptional ambit of the present Australian common law rule of extended common purpose liability. It constitutes a justification for a rigorous principle of accessorial liability that goes beyond that imposing liability for acting in concert and for aiding and abetting (upon which the prosecution alternatively relied in its proceedings against each of the applicants). The question, however, remains whether the resulting formulation is too drastic a departure from the now ordinary requirements that the prosecution must prove that the intention of the accused went with his or her conduct. And whether, in homicide cases like the present, the formulation now adopted leaves adequate room for the offence of manslaughter, as an alternative to the crime of murder, in terms that are realistic so that judges can explain the distinction and so that jurors can understand it90. 86 Simester and Sullivan, Criminal Law Theory and Doctrine, 2nd ed (2003) at 224. 87 (1995) 183 CLR 108 cited in 1997 in Powell [1999] 1 AC 1 at 21, 27 per Lord Hutton. 88 Simester and Sullivan, Criminal Law Theory and Doctrine, 2nd ed (2003) at 226. See also Simester, "The Mental Element in Complicity", (2006) 122 Law Quarterly Review 578 at 592-601. 89 Powell [1999] 1 AC 1 at 14. 90 Hartwick (2005) 159 A Crim R 1 at 19-24 [35]-[45]. Kirby In fact, at the trial of the applicants, manslaughter was left to the jury91, although not in terms entirely to the applicants' liking. Although in this case, as in Gillard, manslaughter, by law, remained an available verdict in respect of each applicant, the difficulty of sustaining it, as a matter of practicality, was correctly noted by the Court of Appeal92. How, for example, knowing that the applicants were armed with weapons of the kind described (a knife, a vacuum cleaner pipe or a cricket stump), the jury could properly and reasonably reach a conclusion of an intention to inflict a trivial injury on the deceased is difficult to see. There may be space for manslaughter, as Gillard holds. But in all truth it is a tiny and elusive one. Suggested maintenance of the doctrine: In addition to its defence of extended common purpose liability, the prosecution argued that, regardless, this Court should refrain from re-expressing the law on the subject. It should stay its hand, as the House of Lords did in Powell, even if it were to conclude that the present law was defective. These arguments are by no means negligible. It is necessary to notice them. First, the prosecution pointed out that the current expression of Australian law on extended common purpose liability was generally compatible with statements of the common law in England93; Northern Ireland94; New Zealand95 and in the Privy Council in respect of Hong Kong96. In these circumstances, demonstration of a need to strike forth on a new Australian approach was said to be unproved. On the other hand, both in the New Zealand and Privy Council decisions (unsurprising because of the common author, Sir Robin Cooke) a series of formulae, expressed otherwise than in terms of "possibility", are advanced, including "substantial risk", "real risk", and "a risk that something might well happen"97, revealing a degree of ambivalence in the foregoing authority about the test to be applied. In Powell, the anomalies and difficulties of the present liability were expressions of law on extended common purpose the 91 (2005) 159 A Crim R 1 at 25-27 [53]-[58]. 92 (2005) 159 A Crim R 1 at 24 [45]. 93 Powell [1999] 1 AC 1 at 29-30. 94 Gamble [1989] NI 268 at 283-284. 95 R v Tomkins [1985] 2 NZLR 253 at 255-256. 96 Chan Wing-Siu [1985] AC 168 at 176-179. 97 Tomkins [1985] 2 NZLR 253 at 255-256; Chan Wing-Siu [1985] AC 168 at 179. Kirby acknowledged but put aside for suggested reasons of practicality rather than legal principle. Secondly, the prosecution argued that, if any change to the expression of the Australian common law on this subject were to be attempted, it should be left to the legislature, acting with the assistance of a law reform or other advisory body. The Court was reminded that, in Victoria, Parliament had reformed the law with respect to felony murder98. Within Australia, law reform agencies have addressed aspects of the law of homicide99. An offence of "wilful murder" was introduced in (and also removed from) the Griffith Queensland Criminal Code100. More recent investigations into the law of homicide have considered the introduction of degrees of murder as recognised in some jurisdictions of the United States101. Against the background of law reform investigations (and reports of the Criminal Law Officers Committee of the Standing Committee of Attorneys- General102 in Australia), the prosecution argued that this Court should leave any reform that might be considered appropriate to Parliament. Obviously this submission has force. I understand the weight accorded to it in the joint reasons103. Not least must the argument be given weight because of a recent 98 Crimes Act 1958 (Vic), s 3A. 99 See eg Victoria, Law Reform Commissioner, Law of Murder, Report No 1, (1974); Law Reform Commission of Victoria, The Law of Homicide in Victoria: The Sentence for Murder, Report No 1, (1985); Law Reform Committee of South Australia, Suggested Amendments to the Law Regarding Attempted Suicide, Report No 14, (1970); Victorian Law Reform Commission, Defences to Homicide: Final Report, (2004). 100 Queensland Law Reform Commission, Abolition of the Distinction Between Wilful Murder and Murder, Report No 2, (1970). This report resulted in the amendment of the Criminal Code (Q). The crime of "wilful murder" remains in the Criminal Code (WA), s 278; cf Ugle v The Queen (2002) 211 CLR 171 at 180-181 [37]; Law Reform Commission of Papua New Guinea, Report on Punishment for Wilful Murder, Report No 3, (1975), proposing incorporation of differential punishment for cases of wilful and other murders under s 309 of the Criminal Code (PNG). 101 New South Wales Law Reform Commission, Partial Defences to Murder: Diminished Responsibility, Report No 82, (1997); see R v Lavender (2005) 222 CLR 67 at 109-110 [131]-[132]. 102 Discussion Draft: Model Criminal Code, Chapter Two, General Principles of Criminal Responsibility, (1992) at 79. 103 Joint reasons at [19]. Kirby report of the Law Commission of England and Wales rejecting the proposition that legislation should be recommended to the United Kingdom Parliament to overturn the effect of the decision in Powell104. Conclusion: need for change: I therefore acknowledge the merits of the arguments deployed against the applicants' submissions. They have persuaded the majority of this Court105 who have decided that the law on extended common purpose, as expressed in McAuliffe and Gillard, should not be reconsidered. I have reached the opposite conclusion for reasons that I will now express. The need for change in extended common purpose liability Defects in liability for possibilities: There are many defects in the statement of the applicable law of extended common purpose liability for the criminal acts of others. No doubt they arise from time to time in other offences, but they are most visible where the offence involved is one of homicide. This is the area of legal discourse to which this Court, and other courts, keep returning. They do so, because murder is ordinarily a crime of specific intent. Obviously, murder is one of the most serious crimes provided by law. In Australia, upon conviction, it often carries the mandatory imposition of a sentence of life imprisonment106. In our society, a conviction of murder also carries a special opprobrium because of the particular respect accorded to human life and the special revulsion felt towards those who unlawfully terminate it107. In Powell, in the context of a law requiring a mandatory life sentence upon conviction for murder, Lord Steyn observed108: 104 Law Commission, Inchoate Liability for Assisting and Encouraging Crime, Law Com No 300, (2006) Cm 6878 at 19 [2.24]-[2.25]. 105 Joint reasons at [15]-[29]. 106 See eg Criminal Law Consolidation Act 1935 (SA), s 11; Criminal Code (Q), s 305(1); Criminal Code (WA), s 282(a); Criminal Code (NT), s 164. In New South Wales, Victoria, Tasmania and the Australian Capital Territory, whilst the maximum sentence for murder is life imprisonment, imposition of that sentence is discretionary. See Crimes Act 1900 (NSW), ss 19A(1), 19A(3); Crimes Act 1958 (Vic), s 3; Criminal Code (Tas), s 158; Crimes Act 1900 (ACT), s 12(2); Crimes (Sentencing) Act 2005 (ACT), s 32(1). See also discussion in Lee Vanit v The Queen (1997) 190 CLR 378. 107 cf Charlie v The Queen (1999) 199 CLR 387 at 399 [27]. 108 [1999] 1 AC 1 at 15. Kirby "There is an argument that, given the unpredictability whether a serious injury will result in death, an offender who intended to cause serious bodily injury cannot complain of a conviction of murder in the event of a death. But this argument is outweighed by the practical consideration that immediately below murder there is the crime of manslaughter for which the court may impose a discretionary life sentence or a very long period of imprisonment. … [T]he problem is one of classification. The present definition of the mental element of murder results in defendants being classified as murderers who are not in truth murderers. It happens both in cases where only one offender is involved and in cases resulting from joint criminal enterprises. It results in the imposition of mandatory life sentences when neither justice nor the needs of society require the classification of the case as murder and the imposition of a mandatory life sentence." The same reasoning applies where, as under the law of Victoria, persons, like the applicants, convicted of murder on the basis of extended common purpose liability, must each, consistent with that conviction, receive very lengthy terms of imprisonment that reflect their common legal liability of this most heinous crime. Secondly, in all criminal offences (but particularly in the offence of murder) it is highly desirable that legal responsibility should generally accord with community notions of moral culpability109. The principle of adhering to "a close correlation between moral culpability and legal responsibility" is not one expressed by philosophers, ethicists, academics and social scientists alone. The words were used by Mason CJ, Toohey, Gaudron and McHugh JJ in their joint reasons in Wilson v The Queen110. Their Honours were there considering whether "battery manslaughter" remained part of the common law in Australia. They observed that "[t]he notion of manslaughter by the intentional infliction of some harm carries with it the consequence that a person may be convicted of manslaughter for an act which was neither intended nor likely to cause death"111. Their Honours therefore concluded that a conviction for manslaughter in circumstances that had previously been recognised as battery manslaughter "does not reflect the principle that there should be a close correlation between moral culpability and 109 Johns, McAuliffe, Gillard, Powell and Chan Wing-Siu were all cases involving extended common purpose liability for homicide. 110 (1992) 174 CLR 313 at 334. 111 (1992) 174 CLR 313 at 332. Kirby legal responsibility, and is therefore inappropriate"112. This Court therefore decided that battery manslaughter was not part of the Australian common law of homicide. Manslaughter by an unlawful and dangerous act was retained, although in an amended form. In effect, in these proceedings, the applicants asked this Court to undertake a similar analysis, and to apply the same criterion, as adopted in Wilson. They submitted that proof by the prosecution of no more than the possibility that a principal offender might intentionally cause grievous bodily harm to a victim did not, of itself, establish conduct sufficiently culpable to warrant conviction of the offence of murder. They suggested that to punish persons who have "neither mentally nor physically committed an offense to the same extent as … those who have"113 was an unjustifiable departure from the fundamental tenet of the Australian criminal justice system, as it has now evolved. They argued that the accessory's level of foresight and intention, posited by the present Australian legal test, was insufficient to warrant conviction of murder. Such evolution has seen developments in the features of accessorial liability long recognised by the common law. As the joint reasons in this Court pointed out in Darkan v The Queen114, different mechanisms have been used, over time, to limit a secondary offender's liability for acts done by a principal offender. Originally, the limit was expressed objectively in terms of the secondary offender's foresight of the probable consequences of the common enterprise. This view, frozen in time, is still reflected in Code provisions, as in Queensland115. However, in the meantime, the common law has moved toward a general harmony with the recognition of the requirement for a subjective element (mens rea) to render particular conduct (actus reus) criminal in character. The test adopted by the common law to constitute what is, in effect, the subjective element in crimes established by extended common purpose liability, falls short of obliging proof of actual intent. All that is required is that the relevant outcome must be foreseen by the accessory as a possibility. The applicants argued that this step forward did not go far enough. It exposes a secondary offender to liability of conviction of murder upon proof by the 112 (1992) 174 CLR 313 at 334. 113 Mueller, "The Mens Rea of Accomplice Liability", (1988) 61 Southern California Law Review 2169 at 2173. 114 (2006) 80 ALJR 1250 at 1266 [76]; 228 ALR 334 at 353. 115 Criminal Code (Q), s 8. See also Criminal Code (WA), s 8; Criminal Code (Tas), s 4. But note Criminal Code (NT), s 8(1). Kirby prosecution of nothing more than foresight of the possibility of homicide. In my view, there is force in the applicants' submission that many juries are likely to conclude that the fact that a murder has occurred shows that it was possible that it would. And if it was possible in fact, it is but a small step to conclude that the secondary offender foresaw, as a possibility, at least that in effecting the common purpose, the victim might suffer really serious harm with intent from the act of the principal offender. It follows that this form of secondary liability is disproportionately broad. It tilts the scales too heavily in favour of the prosecution. It is also the experience of the criminal law that subordinate offenders, who become involved in common criminal enterprises, are sometimes weak, impressionable, vulnerable individuals whose will is insufficient to resist the unexpected, violent acts perpetrated by a ring-leader. Such was certainly the case of Mr Gillard116, who looked up to the principal offender as the "ringmaster" of their joint enterprise. Such was also the case of Mr English, who succeeded before the House of Lords where the other appellant, Mr Powell, failed117. Foresight of what might possibly happen is ordinarily no more than evidence from which a jury can infer the presence of a requisite intention. Its adoption as a test for the presence of the mental element necessary to be guilty of murder, amounts to a seriously unprincipled departure from the basic rule that is now generally reflected in Australian criminal law that liability does not attach to criminal conduct of itself, unless that conduct is accompanied by a relevant criminal intention118. On this ground, the many criticisms that have been voiced by scholars and others about the over-inclusive concept stated in McAuliffe, and confirmed in Gillard and like cases, should be accepted by this Court119. The present law of 116 Gillard (2003) 219 CLR 1 at 22-23 [56]. 117 Powell [1999] 1 AC 1 at 30. 118 See eg R v O'Connor (1980) 146 CLR 64 at 96-97 per Stephen J; He Kaw Teh v The Queen (1985) 157 CLR 523 at 530-531, 565. 119 Clarkson, "Complicity, Powell and Manslaughter", (1998) Criminal Law Review 556 at 557-558. See also Mueller, "The Mens Rea of Accomplice Liability", (1988) 61 Southern California Law Review 2169; Cato, "Foresight of Murder and Complicity in Unlawful Joint Enterprises Where Death Results", (1990) 2 Bond Law Review 182; Bronitt, "Defending Giorgianni – Part One: The Fault Required For Complicity", (1993) 17 Criminal Law Journal 242; Odgers, "Criminal Cases in the High Court of Australia", (1996) 20 Criminal Law Journal 43; Smith, (Footnote continues on next page) Kirby extended common purpose liability is unjust, overbroad and anomalous. It should be re-expressed to narrow its ambit. This re-expression should take the advantage of reducing the legal anomalies and asymmetries that were identified and acknowledged by the House of Lords in Powell. There are many such unprincipled disparities in the current law. I will mention only some of them. If a principal offender were to kill the victim, foreseeing only the possibility (rather than the probability) that his or her actions would cause death or grievous bodily harm, that person would not be guilty of murder120. Yet a secondary offender with a common purpose could, on the current law, be found guilty of murder of the same victim on the basis of extended common purpose liability if the jury were convinced that he or she had foreseen the possibility that one of the group of offenders might, with intent, cause grievous bodily harm and if, in the result, one of the group does indeed kill the victim with the intention to cause such grievous bodily harm121. On the face of things, the secondary offender's moral blameworthiness in such a case is significantly less than that of the principal offender. Yet (particularly in separate trials122) it is quite possible, on current legal doctrine, that the secondary offender might be convicted of murder whilst the principal offender is acquitted, or convicted of a lesser offence123. There is a further anomaly and lack of symmetry upon which the applicants relied. In Giorgianni v The Queen124, this Court expressed the mens "Criminal Liability of Accessories: Law and Law Reform", (1997) 113 Law Quarterly Review 453; Kadish, "Reckless Complicity", (1997) 87 Journal of Criminal Law and Criminology 369; Gray, "'I Didn't Know, I Wasn't There': Common Purpose and the Liability of Accessories to Crime", (1999) 23 Criminal Law Journal 201; "McAuliffe Revisited", (2004) 28 Criminal Law Journal 5; Bronitt and McSherry, Principles of Criminal Law, 2nd ed (2005) at 386-387. 120 cf Crabbe (1985) 156 CLR 464 at 469-470. 121 McAuliffe (1995) 183 CLR 108 at 118. 122 cf Osland v The Queen (1998) 197 CLR 316 at 368-370 [155], [157]. 123 Somewhat analogous and disparate outcomes arose in the case of Mr Bentley. See Bentley (Deceased) [2001] 1 Cr App R 307. 124 (1985) 156 CLR 473. The tension between Giorgianni and McAuliffe has been noted. See Simester, "The Mental Element in Complicity", (2006) 122 Law Quarterly Review 578 at 596. Kirby rea required for other forms of complicity at common law, in the case of an accused charged as an aider, abetter, counsellor or procurer of the offence in question, in terms firmly anchored in a requirement of proof of125: "intentional participation … by lending assistance or encouragement. … The necessary intent is absent if the person alleged to be a secondary participant does not know or believe that what he is assisting or encouraging is something which goes to make up the facts which constitute the commission of the relevant criminal offence." Adherence to the present requirements of liability for an extended common purpose is difficult, or impossible, to reconcile with this approach to criminal liability. It is not necessary here to enter upon the controversies that have arisen as to the exact knowledge necessary to establish the accessory's guilt of the principal's crime126. It is sufficient to identify the serious disparity that has arisen in the requisite subjective element for aiding, abetting, counselling or procuring an offence (murder in particular) and that required for the establishment of guilt as an accessory on the basis of extended common purpose. The applicants ask why, in terms of justice and legal principle, there should be such a difference in the legal elements to be proved to establish, as in their case, guilt of the crime of murder. Why, especially (without the authority of statute), should the prosecution be able to rely on significantly divergent tests for convincing a jury that the same accused was guilty of the one offence? Why, in point of legal principle, should murder in consequence of acting in concert require proof by the prosecution of a specific intention on the part of the secondary offender when no specific intention at all was required for proof of murder in the course of carrying out a purpose held in common that did not include murder? Need to re-express the law: By these and like arguments, the applicants have demonstrated, the serious anomalies, disparities, inconsistencies and lack of symmetry that have been introduced into this area of secondary liability for acts done by others. There is no justification of legal in my view, 125 (1985) 156 CLR 473 at 506 per Wilson, Deane and Dawson JJ. See also at 481- 482, 487-488 per Gibbs CJ, 500, 504-505 per Wilson, Deane and Dawson JJ. 126 See eg Davis v The Queen (1991) 66 ALJR 22 at 23-24 per McHugh J; 103 ALR 417 at 420-421; Edwards v The Queen (1992) 173 CLR 653 at 657-658; Stokes and Difford (1990) 51 A Crim R 25 at 37-39; R v Le Broc (2000) 2 VR 43 at 60-65 Kirby principle for persisting with these defects when they are called to the attention of a final national court with the power and function to address them at the suit of those directly affected. The justification presented by Simester and Sullivan127 is ultimately unpersuasive. The law may indeed dislike group anti-social activities, particularly where they result in death. But a rational and just legal system will dislike such activities equally, whether the conduct charged is prosecuted as an offence of acting in concert or of aiding and abetting others in carrying out the group activity. The law will not withdraw from one means only of establishing the offence (by reliance upon extended common purpose liability) the normal requirement of the modern criminal law that the prosecution prove a requisite intention on the part of the secondary offender. To hold an accused liable for murder merely on the foresight of a possibility is fundamentally unjust. It may not be truly a fictitious or "constructive liability"128. But it countenances what is "undoubtedly a lesser form of mens rea"129. It is a form that is an exception to the normal requirements of criminal liability130. And it introduces a serious disharmony in the law, particularly as that law affects the liability of secondary offenders to conviction for murder upon this basis. By providing a legal footing upon which a jury might find a secondary offender guilty upon proof of mere foresight of the possibility that the victim will suffer really serious harm as a result of the common purpose of the accused, the present doctrine expands the liability of secondary offenders, in the case where a murder is charged, so far that, realistically, there will ordinarily be very little, if any, room left for manslaughter. It is true that in Gillard this Court upheld the need to ameliorate this potential outcome of extended common purpose liability by reserving the availability of a conviction of manslaughter131. However, the room left for a verdict of not guilty of murder but guilty of manslaughter is confined in such 127 See above at [79]-[80]. 128 Powell [1999] 1 AC 1 at 13. 129 Powell [1999] 1 AC 1 at 14. 130 Gillard (2003) 219 CLR 1 at 18-19 [46]-[47], 28-29 [78], 30 [84]; Powell [1999] 1 AC 1 at 11 per Lord Mustill. 131 Gillard (2003) 219 CLR 1 at 29-30 [79]-[83]. Kirby cases almost to disappearing point132. In Gillard (as in this case) that point lay somewhere between contemplation of the possibility that the principal offender would do really serious harm to the victim, and the rejection of that possibility by the contemplation that the harm that would possibly ensue would be trivial, despite the weapons taken to the homicide scene. Little wonder that, in the present case, the Court of Appeal concluded that133: "Given the way in which the case was conducted and the evidence which was before the jury, the suggestion that the jury would have taken the trial 'merely technical assault' is completely judge to be referring to hypothetical." I agree with that estimate. It demonstrates what is, in any case, self-evident. As the ambit of liability for murder is expanded by reference to a possibility that the principal offender might inflict really serious harm on the victim, the availability of an alternative verdict of guilty of manslaughter from a jury, acting rationally and honestly, is virtually nil. This is not a theoretical problem. To the extent that the availability of a realistic verdict of manslaughter permits a court to reflect notions of culpability in accordance with estimates of moral responsibility for the crime assigned by the jury to individual offenders, it serves a most useful social function134. Especially so because, in several Australian jurisdictions, conviction of murder requires the imposition of a sentence of life imprisonment. Conviction of manslaughter, on the other hand, affords a judge a very wide sentencing discretion. It permits a more sensitive reflection of established individual culpability. Generally, this is desirable in the law, but especially so in cases of homicide. Either of the reformulations of extended common purpose liability suggested by the applicants would permit directions to the jury that would be more harmonious with the judge's directions about the other two ways in which the prosecution propounded the applicants' guilt of murder. It would also be more protective of the jury's right to a real choice, consistent with the finding of guilt of homicide but short of murder. The need for re-expression of the law on extended common purpose liability is also demonstrated by the undue complexity that has been introduced by the separate and disharmonious principles to be applied in respect of each of the three ways in which the prosecution sought to justify the applicants' guilt of 132 Gillard (2003) 219 CLR 1 at 26 [69], 29-30 [82]. 133 (2005) 159 A Crim R 1 at 24 [45]. 134 cf Powell [1999] 1 AC 1 at 15 per Lord Steyn. See also Gillard (2003) 219 CLR 1 Kirby murder at their trial. For two of these ways (acting in concert and aiding and abetting) intention on the part of the accused at least to cause really serious injury has to be proved. But for the third (extended common purpose liability) proof of intention as such is unnecessary. This distinction introduces a needless disparity and complexity that must be extremely confusing to juries, as well as difficult for trial judges who have the responsibility of explaining secondary criminal liability to a group of lay citizens performing jury service. What jurors must make of the disparity, and the nuances of difference between the distinct modes of possible reasoning to their conclusion, is best not thought about. The unreasonable expectation placed upon Australian trial judges (affirmed by appellate courts) to explain the idiosyncrasies of differential notions of secondary liability to a jury is something that should concern this Court. Especially so in the case of major points of difference in the governing legal principles (such as the absence of reference to specific intention in the explanation of extended common purpose liability). In my view it behoves this Court to try harder to find a unifying principle for secondary criminal liability. After all, the object is to explain to a jury, on the basis of common facts, how they may reason to a single conclusion, namely guilty, or not guilty, of murder. The law should not be as unjust, obscure, disparate and asymmetrical as it is. Its present shape can only cause uncertainty for trial judges and confusion to juries. Where, as in these applications, a specific application was made to this Court to rationalise and unify the applicable law, we should not rebuff the request so peremptorily and uncritically. On the contrary, this is precisely the kind of case in which a court such as this fulfils its role as expositor of the general principles of the common law for this country. The joint reasons suggest that the issues for the jury's verdicts need not be over-elaborate or over-complicated in trials of the present kind135. I wish that I could agree. The experienced trial judge who presided at the trial of the present applicants that lasted forty-six sitting days, charged the jury over three days. In the hope, no doubt, of avoiding accidental error in his oral directions, he provided the jury with written instructions that reflected the substantial complexities of the elements of each of the three ways in which the prosecution put its arguments for verdicts of guilty of murder. In accordance with McAuliffe, the written direction asked the jury, relevantly, to decide whether: "The Accused you are considering foresaw as a possibility in the carrying out of the agreed understanding or arrangement that death or really serious injury would occur by a conscious, voluntary and deliberate act of one of them not done in self defence." 135 Joint reasons at [29]. Kirby For issues which the majority say are relatively simple, a great deal of effort was consumed to explain the different principles to the jury, and correctly so. Much of counsel's addresses at the trial were devoted to the same points. The prosecution was entitled to present the cases against the three applicants in every way lawfully available to it. However, the ensuing disparities and inconsistencies in the applicable principles of secondary liability introduce undue complexity to the applicable legal rules upon which the jury are told they must act. Such complexity is also inconsistent with the basic function of jury trial. In these proceedings this Court cannot solve all of the problems presented by the complexity. However, in my view, the Court should endeavour, when the opportunity is presented, to remove or reduce at least the most obvious inconsistencies of which the applicants complain. If ever there was a part of the law where consistency and symmetry should be at a premium, it is where murder is charged and where the trial judge has the duty of explaining to the jury, by reference to the facts, how they may reason to their verdict on that charge. These are powerful reasons for reducing the disharmony in the separate modes of reasoning which are occasioned by the present law on extended common purpose liability. The applicants specifically requested this Court to do so. On this occasion, there is no procedural or technical impediment to the Court's responding to the request. Justification for judicial re-expression: I accept that reasons may be collected for washing our hands of responsibility for the present state of the law, as revealed by these applications and earlier cases, and leaving its repair, if at all, to the several Parliaments of the States and Territories concerned. Deciding when that course is appropriate and when judicial re-expression of the common law is proper often presents a difficult question on which judicial minds may differ136. Nowadays, the general responsibility for the reform and restatement of the criminal law lies with the legislature. Especially where there is any suggestion of the expression of a new or additional form of criminal liability, the courts, in recent times, have disclaimed a creative role137. 136 Brodie v Singleton Shire Council (2001) 206 CLR 512 at 591-597 [203]-[219]. 137 Knuller (Publishing, Printing and Promotions) Ltd v Director of Public Prosecutions [1973] AC 435 at 466; Director of Public Prosecutions v Withers [1975] AC 842 at 857-859, 863, 877; cf Lipohar v The Queen (1999) 200 CLR 485 Kirby In matters of criminal law, I have sometimes concluded that this Court should not re-express the law, despite the demonstration of deficiencies138. However, in the present proceedings, I have reached a different conclusion. In summary, my reasons are as follows: . What is proposed is not the enlargement of criminal liability or the imposition of liability where it did not previously exist. On the contrary, it is the rationalisation and simplification of the present rules of secondary criminal liability so as to remove current disparities and disharmonies that result in the overreach of criminal liability; The particular law challenged in these proceedings is not, as the prosecution suggested, a law of long standing. Effectively, it dates in Australia from the early 1980s. Its deficiencies have been noted ever since. They have been complained about and criticised. In these applications, a specific request has been made to the court having the power and responsibility to do something about the defects and to remove the potential for injustice that they occasion; injustice and The law in question was originally expressed by judges. It can therefore be re-expressed by them. The advantage of this Court's doing so is that the the anomalies, asymmetries, complexities and unconceptual defects of the law can be repaired by this Court for all jurisdictions of Australia where the common law of criminal responsibility applies. This Court has often referred to the desirability of maintaining a general uniformity in the expression of the basic rules of criminal responsibility in Australia139. Complete uniformity in this aspect of the criminal law is impossible, given the different approach taken in the Code jurisdictions of Australia. However, what this Court stated in Johns, McAuliffe and Gillard it can now restate. It can do so in the light of the criticisms addressed by the applicants to the present law as applied in their trial; . With all respect to the recent conclusion that the problem should be left to the legislature, as stated by the House of Lords in Powell, that conclusion does not govern the response of this Court to the applicants' submissions. We have a constitutional and judicial function in Australia, in deciding matters brought to this Court, to state the common law for every part of 138 As in Lipohar (1999) 200 CLR 485 at 563-565 [198], [201]-[202] and Lavender (2005) 222 CLR 67 at 110 [134]-[135]. 139 R v Barlow (1997) 188 CLR 1 at 32; Darkan (2006) 80 ALJR 1250 at 1274 [127]; 228 ALR 334 at 363. Kirby this nation140. A different conclusion by courts in other nations on like questions is no longer determinative of this Court's decisions; . Also, with respect to the conclusion on the point in issue in these proceedings, expressed in the recent report of the Law Commission of England and Wales141, I am not convinced by its reasoning and I note that it has proved controversial in its own jurisdiction. More convincing on this point are the criticisms of the present state of the law on extended common purpose liability expressed by many distinguished scholars in the United Kingdom, not least the late Professor Sir John Smith142, upon whose writings and criticisms the applicants heavily relied. The flaw in the reasoning of those who have defended the current law is that the legal fiction they endorse143 can operate with a serious lack of proportionality. Culpability is too easily trumped by the desire for criminalisation. That may not concern those who live in a world of theory. It should, however, concern judges of the common law whose orders often result in multiple cases of very prolonged imprisonment for wrongdoing where individual culpability does not warrant that course – even allowing for the collusion in a joint enterprise of some kind; Suggestions for the parliamentary rationalisation and modernisation of the English law were made in R v Cunningham144. There, Lord Edmund- Davies expressed the hope that the legislature would undertake the necessary and urgent task of reform. That hope was repeated in 1997 in Powell by Lords Mustill145 and Steyn146. The latter pointed to the availability of a "precise and sensible solution, namely, that a killing should be classified as murder if there is an intention to kill or an intention to cause really serious bodily harm coupled with awareness of the risk of 140 Lange (1997) 189 CLR 520 at 562-567. 141 Law Commission, Inchoate Liability for Assisting and Encouraging Crime, Law Com No 300, (2006) Cm 6878 at 13 [2.3], 19 [2.24]-[2.25]. 142 Smith, "Criminal Liability of Accessories: Law and Law Reform", (1997) 113 Law Quarterly Review 453 at 464. 143 eg Simester, "The Mental Element in Complicity", (2006) 122 Law Quarterly Review 578 at 600. 144 [1982] AC 566 at 583. 145 Powell [1999] 1 AC 1 at 12. 146 Powell [1999] 1 AC 1 at 15. Kirby death"147. A similar solution was supported by a House of Lords Committee148. However, these solutions had not been implemented in England. The House of Lords' suggestion would have the merit of requiring a finding on the specific intention of the individual accused in each of the three bases upon which the prosecution presented its case against the applicants, suggesting that they were guilty of the offence of murder. The more recent attempt of the Law Commission to find a solution more palatable to the legislature can only be explained by the failure of the United Kingdom Parliament to adopt this earlier principled approach to reform. In the present age, waiting for a modern Parliament to grapple with issues of law reform of this kind is like waiting for the Greek Kalends. It will not happen. Eventually courts must accept this reality and shoulder their own responsibility for the state of the common law; and . Within Australia, piecemeal reforms by way of limited statutory enactments have been achieved149. However, for the common law jurisdictions of Australia, the applicable law remains unchanged. The result is unconceptual and unduly complex. It is also unjust. It casts the net of liability for murder too widely. It is insufficiently discriminating in respect of individual responsibility. It catches potentially weak and vulnerable secondary offenders and, by a legal rule, attributes to them liability that may properly belong only to the principal offender. Effectively at the option of prosecutors, it fixes people with very serious criminal liability because they were in the wrong place at the wrong time in the wrong company. It is prone to misuse by public authorities. It deflects prosecutors and juries from the difficult but ordinarily necessary task of assigning criminal liability appropriately by reference to proved moral culpability, particularly in the circumstances of homicide which attract the serious punishments properly imposed in respect of conviction for such offences. Conclusion: re-expression required: It follows from these considerations that I would accede to the applicants' submissions. This Court should re-express 147 Referring to Criminal Law Revision Committee, Offences against the Person, Report No 14, (1980) Cmnd 7844 at 14 [31] adopted in Law Commission, A Criminal Code for England and Wales, Law Com No 177, (1989), vol 1, cl 54(1) of the draft Criminal Code Bill. 148 United Kingdom, House of Lords, Report of the Select Committee on Murder and Life Imprisonment, HL Paper No 78-I, (1989) at 25 [68]. 149 See, eg, Criminal Code (Cth), s 11.2. Kirby the principle of the common law concerning extended common purpose liability in Australia for criminal acts done by others. The present applications afford a proper opportunity to do so. The re-expression of extended common purpose liability Alternative restatements of the rule: Once the foregoing conclusion is reached, two possibilities exist for the re-expression of the common law, at least in the case of extended common purpose in homicide cases. The first, and simpler approach would be for this Court to replace the foresight required of the secondary offender under the present law by foresight of an outcome that was regarded as probable. Thus, the present test, addressed to what is viewed as possible, would be altered to address attention to what the secondary offender viewed to be probable. Such a change would be modest, confined but consistent with the earlier recognition of liability for a form of recklessness as explained by this Court in R v Crabbe150. The second possibility, which the applicants submitted was preferable, because it was more principled, would be to follow the suggestion of Professor "It may be that the law is too harsh and, if so, it could be modified so as to require intention (or even purpose) on the part of the accessory that, in the event which has occurred, the principal should act as he did. … If it were to be decided that intention should be required, the jury would be told that they should not find D guilty of murder unless they were sure that D either wanted P to act as, and with the intention which, he did, or knew that it was not merely a 'real possibility' but virtually certain that he would do The preferable reformulation: The substitution of "probability" for "possibility" would have the advantage of simplicity. It would adopt a more stringent criterion for liability than that contained in the existing formulation. It would provide a test that would leave an enlarged scope for the operation of manslaughter. It would produce a result similar in some ways to that adopted in 150 (1985) 156 CLR 464 at 468-470; cf Lavender (2005) 222 CLR 67 at 107-108 151 Smith, "Criminal Liability of Accessories: Law and Law Reform", (1997) 113 Law Quarterly Review 453 at 465 (original emphasis). Kirby the Criminal Code (Cth)152 and somewhat similar to that adopted in the Criminal Codes of Queensland, Western Australia and Tasmania153. However, the disadvantages of the first solution are obvious. The omission of any reference to the accused's "intention" would remain. Asymmetry between the different paths for permissible jury reasoning would persist. There would still be a serious lack of harmony between legal responsibility and moral culpability. The outcome would not be sound in principle. To that extent, it would defeat the essential purpose of re-expressing the governing law. The compass that will allow us to find our way again in this field of law is the now usual requirement of mens rea154. It is for this reason that I prefer the formulation proposed by Professor Smith. In the place of telling the jury, relevantly, that they might convict a secondary offender for a crime actually committed by another in the course of a common enterprise if it was proved that that offender participated or continued to participate in the enterprise aware that it was possible that another participant might commit murder, the judge would explain the need for the jury to be sure that the secondary offender either wanted the principal offender to act as he or she did, with the intention which he or she had, or knew that it was virtually certain that the principal offender would do so. This formula for extended common purpose liability would result in a proper correlation between legal responsibility and moral culpability in the crime of murder, proved by reference to the intention of the accused. It would restore symmetry with the existing principles of complicity at common law. In the words used in McAuliffe155, it would be "in accordance with the general principle of the criminal law that a person who intentionally assists in the commission of a crime or encourages its commission may be convicted as a party to it". It would be simpler for judges to explain to juries. It would be easier for jurors to understand. It would be more consonant with the requirement of the intention needed to establish each of the other modes of reasoning relied on by the prosecution (acting in concert and aiding and abetting) to sustain an accused's 152 Criminal Code (Cth), s 11.2. 153 Darkan (2006) 80 ALJR 1250 at 1257-1260 [29]-[40], 1273-1274 [124]; 228 ALR 334 at 341-345, 363. Note that the Code provisions in Canada and New Zealand require a more stringent test. See Darkan (2006) 80 ALJR 1250 at 1259-1260 [36]-[38], 1266-1267 [77], 1274 [126]; 228 ALR 334 at 343-344, 353, 363. 154 cf Simester, "The Mental Element in Complicity", (2006) 122 Law Quarterly Review 578 at 582, 590. 155 (1995) 183 CLR 108 at 118. Kirby guilt of murder. And it would leave an enlarged and more appropriate scope, in the proper case, for the operation of the law of manslaughter. It would encourage juries to focus on the proved responsibility of each accused where the present law too readily sweeps them all up into a quasi-fictional responsibility for acts done by someone else, which acts the secondary offender may not have desired, anticipated, expected or intended. The correct disposition of the proceedings Alternative dispositive orders: Having reached the foregoing conclusion, it is my view that this Court should have granted special leave to the applicants and upheld their appeals. A difficult question then arising is what this Court should have ordered. The applicants asked that their convictions be set aside and a new trial ordered. In favour of that course is the fact that there was nothing that the applicants could have done, at trial or in the Court of Appeal, to secure acceptance of the proposition which they urged on this Court. At both levels in the Supreme Court of Victoria, the judges were bound to conform with the holdings of this Court on extended common purpose liability as expressed in McAuliffe and Gillard. Furthermore, because the mode of reasoning by the jury to the verdict of guilty of murder returned in the case of each applicant is unexplained, it is possible that such verdicts rested on the jury's conclusion based on the prosecution case expressed in terms of extended common purpose liability alone. Because that mode of reasoning was the one most favourable to the prosecution, and relieved the jury of the necessity to evaluate the specific intentions of each applicant, it would not be difficult to infer that it might have been the course that the jury took in reaching their verdicts in the trial of the present applicants. The proper orders: Nevertheless, since this Court's decision in Weiss156 re-expressed to some extent the way in which courts of criminal appeal in Australia should consider the disposal of appeals where legal error has been shown, anchored in the statutory necessity to demonstrate a miscarriage of justice in the case, it is appropriate that the prosecution should have an opportunity, if it should so wish, to persuade the Court of Appeal of Victoria that this would be a case for the application of the "proviso". In a matter so important as the instruction provided to the jury on the proper way of reasoning to their verdicts, it would be consistent with Weiss for 156 (2005) 80 ALJR 444 at 453-456 [35]-[47]; 223 ALR 662 at 672-675; cf Darkan (2006) 80 ALJR 1250 at 1269 [94]-[96], 1277-1278 [143]-[149]; 228 ALR 334 at Kirby the Court of Appeal to conclude that the demonstrated defect in the judge's instruction, shown by the development and re-expression of the law as I would favour, amounted of itself to a miscarriage of justice, was a fundamental defect in the conduct of the trial and required a retrial. However, in the view that I take, that would be a conclusion that I would leave to the Court of Appeal to decide. Orders Although the majority of this Court was of the view announced at the conclusion of oral argument that the applicants' applications for special leave should be dismissed, I would grant each of the applications and allow each appeal. I would set aside so much of the orders of the Court of Appeal of the Supreme Court of Victoria as dismissed the applicants' appeals against their convictions of murder and return the proceedings to the Court of Appeal for disposition consistently with these reasons.

HIGH COURT OF AUSTRALIA CHARLES STUART GORDON APPELLANT AND RAYMOND GEORGE TOLCHER IN HIS CAPACITY AS LIQUIDATOR OF SENAFIELD PTY LTD (IN LIQUIDATION) & ANOR RESPONDENTS Gordon v Tolcher in his capacity as liquidator of Senafield Pty Ltd (In liquidation) [2006] HCA 62 15 December 2006 ORDER Appeal dismissed with costs. On appeal from the Supreme Court of New South Wales Representation B A J Coles QC with C R C Newlinds SC and D A Allen for the appellant (instructed by Linde Business Law) G O'L Reynolds SC with R C Scruby and P Kulevski for the respondents (instructed by Kemp Strang) H C Burmester QC with G A Hill for the Attorney-General of the Commonwealth intervening (instructed by Australian Government Solicitor) P J Hanks QC with S G E McLeish for the Attorney-General for the State of Victoria intervening (instructed by Victorian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Gordon v Tolcher in his Capacity as Liquidator of Senafield Pty Ltd (in liq) Courts – Federal jurisdiction in State courts – Proceedings brought in New South Wales District Court – Section 1337E of the Corporations Act 2001 (Cth) ("Corporations Act") conferred federal jurisdiction on "lower courts" in "matters" under the Corporations Act – Section 588FF(3) of the Corporations Act provided for time limits on commencement of actions – Part 3 r 2 of the District Court Rules 1973 (NSW) ("the Rules") authorised extension of time – Whether s 79 of the Judiciary Act 1903 (Cth) "picked up" the provisions of the Rules relating to extension of time – Whether the Corporations Act was a Commonwealth law that "otherwise provided" to prevent the provisions of the Rules relating to extension of time being "picked up". Limitation of Actions – Proceedings brought under the Corporations Act – Proceedings deemed to be dismissed by Pt 18 r 9 of the Rules – Whether extension of time under Pt 3 r 2 of the Rules valid. Words and phrases – "otherwise provided", "dismissal", "picked up". Corporations Act 2001 (Cth), ss 9, 1337E, 588FF. District Court Act 1973 (NSW), ss 8, 161. District Court Rules 1973 (NSW), Pt 3 r 2(2), Pt 18 r 9. Judiciary Act 1903 (Cth), s 79. GLEESON CJ, GUMMOW, HAYNE, CALLINAN AND HEYDON JJ. The appellant, the defendant in the proceedings in the District Court of New South Wales where this litigation commenced, is the father of the sole director and shareholder of the second respondent. The first respondent is the liquidator of the second respondent. It is alleged that the second respondent was a rural landholding company and that the second respondent gave to the appellant for no consideration mortgages over various properties owned by the second respondent and a fixed and floating charge over all of its assets. The mortgages and charges are said to have conferred no benefit on the second respondent. The respondents seek the recovery of moneys which represent the funds received by the appellant from the sale of the mortgaged properties. The litigation has reached this Court on an issue respecting the scope of the federal jurisdiction exercised by the District Court and, in that regard, the interaction of provisions of the Corporations Act 2001 (Cth) ("the Corporations Act") and s 79 of the Judiciary Act 1903 (Cth) ("the Judiciary Act"). An understanding of the issues must proceed from a consideration of the terms of that legislation. The Corporations Act and the Judiciary Act The Corporations Act deals distinctly with the creation of rights and liabilities, and with the conferral of federal jurisdiction to adjudicate matters arising thereunder. As to the creation of relevant rights and liabilities, the statute provides in Ch 5 (Pts 5.1-5.9) for matters of "External administration". Part 5.7B contains provisions respecting recovery of property or compensation for the benefit of creditors of an insolvent company. Division 2 thereof (ss 588FA- F88FJ) deals with "Voidable transactions". These include "Unfair preferences" (s 588FA), "Uncommercial transactions" (s 588FB), "Insolvent transactions" (s 588FC) and "Unfair loans to a company" (s 588FD)1. Section 588FE renders voidable certain of the transactions described in these earlier provisions. Section 588FF then provides for the making of court 1 Division 2 of Pt 5.7B was amended by the Corporations Amendment (Repayment of Directors' Bonuses) Act 2003 (Cth) to provide for what were identified as the transactions". "unreasonable director-related legislation in its earlier form and references to the Corporations Act in these reasons are to be read accordingly. litigation concerns This orders in respect of transactions which are voidable because of s 588FE. It is convenient to refer more fully to that section later in these reasons. It is necessary now to turn to the provisions respecting adjudication of matters arising under these provisions of Pt 5.7B. Section 58AA(2) states: "Except where there is a clear expression of a contrary intention (for example, by use of the expression 'the Court'), proceedings in relation to a matter under this Act may, subject to Part 9.7, be brought in any court. Note: The matters dealt with in Part 9.7 include the applicability of limits on the jurisdictional competence of courts." Part 9.7 deals with unclaimed property. It is apparent that the above references to "9.7" in s 58AA should be to "9.6A"2. The expression "superior court matter" is defined in s 9 as follows: "superior court matter means a civil matter that this Act clearly intends (for example, by use of the expression the Court) to be dealt with only by a superior court". A "superior court" is the Federal Court, the Supreme Court of a State or Territory, the Family Court and a State Family Court (s 9). Part 9.6A of Ch 9 is headed "Jurisdiction and procedure of Courts". Division 1 (ss 1337A-1337U) is headed "Civil jurisdiction". The District Court of New South Wales is constituted by s 8 of the District Court Act 1973 (NSW) ("the District Court Act"). Section 1337E of the Corporations Act confers jurisdiction on "the lower courts" of New South Wales with respect to "matters" arising under the Corporations Act, not being "superior court matters". Jurisdiction is conferred with respect to Corporations Act "matters", subject to the general jurisdictional limits of the court in question relating to amounts and value of property but is not made subject to other jurisdictional limits (s 1337E(2)). cf the discrepancy revealed in WACB v Minister for Immigration and Multicultural and Indigenous Affairs (2004) 79 ALJR 94 at 101-102 [38]-[40]; 210 ALR 190 at Although the parties did not place any particular reliance upon other parts of Ch 9, some reference should be made to Pt 9.4B (ss 1317DA-1317S) and to Pt 9.5 (ss 1318-1327). The former deals with the civil consequences of contravening civil penalty provisions and the latter confers on courts invested with jurisdiction in matters arising under the legislation a range of powers and remedies. However, neither Pt 9.4B nor Pt 9.5 encompasses the provisions for the conduct of litigation which generally are left to Rules of Court. Section 79 of the Judiciary Act 1903 (Cth) ("the Judiciary Act") states: "The laws of each State or Territory, including the laws relating to procedure, evidence, and the competency of witnesses, shall, except as otherwise provided by the Constitution or the laws of the Commonwealth, be binding on all Courts exercising federal jurisdiction in that State or Territory in all cases to which they are applicable." The laws of New South Wales relating to procedure included the District Court Rules 1973 (NSW) ("the Rules") made under the powers conferred by s 161 of the District Court Act3. The controversy in this Court concerns the operation of s 79 of the Judiciary Act. In short form, the issue is whether in the District Court proceedings certain provisions of the Rules were not "picked up" by s 79 because, within the meaning of that section, there was a law of the Commonwealth, namely s 588FF of the Corporations Law, which "otherwise provided". Section 588FF of the Corporations Act Section 588FF(1) states that "a court" may make one or more of the orders identified in pars (a)-(j) of that sub-section: "Where, on the application of a company's liquidator, a court is satisfied that a transaction of the company is voidable because of section 588FE 3 The Rules have been replaced by the Uniform Civil Procedure Rules 2005 (NSW) made pursuant to the Civil Procedure Act 2005 (NSW) but the provisions of the Rules with which this appeal is concerned have substantially been replicated by the new provisions. Paragraphs (a)-(j) list a range of orders in terms which might be thought to involve some overlapping. It is in that setting that s 588FF(2) provides that nothing in sub-s (1) limits the generality of anything else in that sub-section. Section 588FF(3) is of particular significance for this appeal. It states: "An application under subsection (1) may only be made: (a) within 3 years after the relation-back day; or (b) within such longer period as the Court orders on an application under this paragraph made by the liquidator within those 3 years." The use in sub-s (1) of the term "a court" and in sub-s (3) of the term "the Court" should be noted. When used in s 588FF(1), "court" means any court (s 58AA(1)), upon which federal jurisdiction in the matter has been conferred. The jurisdiction of the District Court in the matter was invested under s 1337E of the Corporations Act, referred to above, the District Court being one of "the lower courts" of New South Wales. The term "lower court" is defined in s 9 as meaning a court of a State or Territory that is not a superior court. However, the District Court would not have had the federal jurisdiction vested in it to entertain any application for the setting of a longer period under sub-s (3)(b) of s 588FF within which the substantive application might be made. That absence of jurisdiction would have resulted from the use of the expression "the Court" in par (b) of sub-s (3) as identifying only a superior court. The expression "the relation-back day" within three years after which an application under sub-s (1) may only be made (sub-s (3)(a)) is defined in s 9 in terms which it is unnecessary to set out. By order of the Supreme Court of New South Wales on 5 June 2000, the predecessor of the first respondent (who also will be identified in these reasons as the first respondent) was appointed liquidator of the second respondent. The definition of "the relation-back day" so operated in those circumstances as to fix that day as 5 May 2000. On 2 May 2003, that is to say shortly before the end of the three year period fixed by par (a) of s 588FF(3), the respondents instituted by statement of liquidated claim filed in the District Court a proceeding against the appellant claiming the sum of $522,504.07 in respect of certain alleged uncommercial transactions and insolvent transactions. All of these were said to be voidable transactions within the meaning of s 588FE of the Corporations Act. Orders were sought pursuant to s 588FF(1). The steps taken in the District Court As matters stood on 1 December 2003, the statement of liquidated claim had not been served on the appellant and, accordingly, no notice of grounds of defence had been filed. Nor had the occasion arisen for the entry of any default judgment or the making of any other order disposing of the proceeding. Part 18 r 9 of the Rules provided that certain "dormant" actions are "taken to be dismissed". It stated: "If an action is commenced by the lodging of a statement of liquidated claim and, on the expiry of the period of 6 months and 28 days from the date of the commencement of the action: a notice of grounds of defence has not been filed, and default judgment has not been entered or the action otherwise disposed of by judgment or final order, the action is taken to be dismissed on the day following the day on which that period expires." The result was that on 1 December 2003 the action against the appellant was "taken to be dismissed". The appellant does not challenge the operation of s 79 of the Judiciary Act to pick up Pt 18 r 9 to achieve that result. It is with the steps subsequently taken under the Rules to maintain the proceedings against the appellant that he takes issue. By notice of motion dated 19 January 2004, the respondents sought from the District Court orders which would have the effect of rescinding the deemed dismissal which had been effected by Pt 18 r 9. The date of 19 January 2004 was, of course, well after the end of the three year period identified in s 588FF of the Corporations Act. In his reasons, Armitage DCJ concluded that the prejudice to the appellant, given his state of health, in now being called upon to defend the substantive proceeding, outweighed the case for granting the relief sought on the motion by the respondents. In support of that motion, the respondents relied upon evidence of difficulties and delays in obtaining and retaining funding for the substantive proceedings. The Court of Appeal The Court of Appeal (Hodgson, Ipp and Tobias JJA) granted an application by the respondents for leave to appeal and on 3 May 2005 ordered that the time for service of the statement of liquidated claim be extended up to, and that service be deemed to have been effected on, that day; the Court also ordered that the time specified in Pt 18 r 9 of the Rules be extended "nunc pro tunc up to and including a date being 60 days after the date of these orders"4. An application by the appellant to this Court for special leave was dismissed in so far as he disputed the manner and exercise by the Court of Appeal of the relevant powers under the Rules. However, leave was granted upon the issue of whether the Court of Appeal had erred in failing to hold that the provisions of the Rules authorising extension of time within which the respondents' application might be maintained, notwithstanding their earlier dismissal under those Rules, were not applied by s 79 of the Judiciary Act because s 588FF(3) of the Corporations Act was a Commonwealth law which "otherwise provided". The Court of Appeal expressed its orders as based on Pt 3 r 2(2) of the Rules. Sub-rules (1) and (2) of Pt 3 r 2 stated: "(1) The Court may by order extend or abridge any time fixed by the rules or by any judgment or order. The Court may extend time under subrule (1) as well after as before the time expires, whether or not an application for the extension is made before the time expires or at all." (emphasis added) It will be recalled that Pt 18 r 9 uses the phrase "the action is taken to be dismissed". That form of words suggests that the outcome is to be deemed to be that which would have obtained had there been a dismissal by Court order. The term "dismiss" is defined in Pt 1 r 4(1) as follows: "dismiss, in relation to any proceedings, means finally dispose of the proceedings, but (except where the proceedings consist of an appeal to the 4 Tolcher v Gordon (2005) 53 ACSR 442; 23 ACLC 798. Court) without prejudice to any right to commence fresh proceedings seeking the same, or substantially the same, relief". The reference to "any right to commence fresh proceedings" would not have availed the respondents in this litigation; given the lapse of time, that "right" could not exist in the face of s 588FF(3) and s 79 of the Judiciary Act would not have picked up so much of the Rules as conferred such a "right". Special provision is made by Pt 1 r 7A where there has been a "preliminary dismissal order". This means "an order made by the Court dismissing proceedings other than an order dismissing proceedings after there has been a trial or hearing on the merits of the case or an application to dismiss the proceedings". Rule 7A empowers the Court, on application, to set aside a preliminary dismissal order. On their motion which was dismissed by Armitage DCJ, the respondents had relied upon r 7A, in the alternative to any other applicable provision. However, as indicated, the Court of Appeal made its orders nunc pro tunc on a different footing, that provided by the general power of extension of time provided by Pt 3 r 2. Given the limited grant of special leave by this Court, it is inappropriate to venture further into any questions of construction of the Rules. It is sufficient for the purposes of the present appeal that the orders of the Court of Appeal were made after the end of the three year period spoken of in s 588FF(3) and that, had the Court of Appeal not made those orders, the position would have remained that the application was taken to have been dismissed by operation of Pt 18 r 9 as a dormant action. The interrelation between the Judiciary Act and the Corporations Act Section 1337A of the Corporations Act is included in Div 1 of Pt 9.6A, which deals with civil jurisdiction. The section excludes the operation of s 39B of the Judiciary Act which confers certain jurisdiction on the Federal Court (s 1337A(2)). However, Div 1 does not limit the operation of the other provisions of the Judiciary Act (s 1337A(3)). The Division thus recognises the concurrent operation of s 79 of the Judiciary Act. Further, the Division does not limit the operation of s 39(2) of the Judiciary Act with respect to civil matters arising under the Corporations Act (s 1337A(4)). Section 39(2) is the general provision for the investment of federal jurisdiction in the several courts of the States. This included the appellate jurisdiction exercised in this case by the New South Wales Court of Appeal5. Section 5E of the Corporations Act states an intention not to exclude or limit the concurrent operation of any State law provided there is no direct inconsistency. However, that provision has no significance in the present case. Of their own force the Rules had no application to the exercise of federal jurisdiction by the District Court; hence the occasion for the operation of s 796. The appellant submits that, were there to be "picked up" the Rules which supported the orders made by the Court of Appeal, s 588FF of the Corporations Act would so reduce their ambit that s 588FF would be irreconcilable with them; accordingly, the Corporations Act "otherwise provides" within the meaning of s 79 as construed in accordance with the decisions of this Court, and the relevant Rules are not "picked up"7. Section 588FF does not deal with the investment of federal jurisdiction in any court or with the manner of exercise of that jurisdiction. The section is found in Pt 5.7B, whilst the jurisdiction of courts is provided for in Pt 9.6A. Section 588FF is silent respecting the procedures to be adopted by the court exercising federal jurisdiction in the present matter; this jurisdiction is conferred by s 1337E upon the District Court. Section 588FF evinces a two-fold legislative intention. First, conferral of federal jurisdiction is left to Pt 9.6A of the Corporations Act. Secondly, subject to any operation of other provisions of the Corporations Act, after the institution of an application the procedural regulation of the conduct of a matter is left for that particular State or territorial procedural law which is to be picked up by s 79 of the Judiciary Act. 5 See R v Whitfield; Ex parte Quon Tat (1913) 15 CLR 689. 6 Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 352 [35]; APLA Ltd v Legal Services Commissioner (2005) 79 ALJR 1620 at 1663-1664 [230]; 219 ALR 403 at 459; Hill and Beech, "'Picking up' State and Territory laws under s 79 of the Judiciary Act – three questions", (2005) 27 Australian Bar Review 25 at 27-28. 7 Northern Territory v GPAO (1999) 196 CLR 553 at 587-589 [78]-[83], 606 [135], 650 [254]; Austral Pacific Group Ltd (In liq) v Airservices Australia (2000) 203 CLR 136 at 144 [17], 155 [53], 169 [106]. That conclusion is sufficient to dispose of the appeal, but something more should be said respecting the construction of s 588FF, its presence in Pt 5.7B and its relationship with the conferral of civil jurisdiction made by Div 1 of Pt 9.6A of the Corporations Act. Does s 588FF "otherwise provide"? Section 588FF postulates the operation of s 588FE to render certain transactions voidable. The section deals with the consequences of that state of affairs by the making of court orders upon satisfaction that the transaction in question is voidable by operation of s 588FE. Section 588FF is enlivened only upon application by the liquidator of the company in question. Further, that application may only be made within three years after the relation-back day or thereafter within the longer period fixed on a separate and anterior application by the liquidator made within those three years (s 588FF(3)). That an application for the fixing of that longer period is a "matter" distinct from that seeking an order with respect to the voidable transaction is apparent from the identification in s 588FF of the courts to deal with the applications. As indicated earlier in these reasons, "the Court" to make an order for a longer period under par (b) of s 588FF(3) could not have been the District Court because it would not have answered the term "the Court", the District Court being a lower court rather than a superior court. On the other hand, as was the case, the application under s 588FF(1) was made to the District Court, it answering the description "a court". Two stipulations for the competent institution of the application under s 588FF(1) which the respondents made to the District Court were that it be made by the liquidator of the second respondent and that it be made, as was the case, within three years after the relation-back day. These stipulations were elements of the right of the respondents to have that Court consider the making of the order for payment sought by them. The provision in sub-s (3) of s 588FF as to the time of the making of the application is of the essence of the provision made by s 588FF; it is not to be characterised merely as a time stipulation of a procedural nature8. The 8 See Rudolphy v Lightfoot (1999) 197 CLR 500 at 507-508 [11]-[12]; Agtrack (NT) Pty Ltd (t/a Spring Air) v Hatfield (2005) 79 ALJR 1389 at 1398 [51], 1399 [54]; 218 ALR 677 at 689, 690. significance of sub-s (3) the statutory scheme was considered by Spigelman CJ, who gave the leading judgment in BP Australia Ltd v Brown9. His Honour referred to the General Insolvency Inquiry ("the Harmer Report")10, published in 1988. Paragraph 688 of the Harmer Report had stated: "Actions by a liquidator to recover the proceeds of a void execution, a preference, a transaction at an undervalue or a transaction with intent to defeat should be commenced within a reasonable time. The Commission proposed in [Discussion Paper 32 (par 454)] that a liquidator should have three years to commence such an action, although the court might extend that time. Under the existing law the time period would be six years (for example, [the Bankruptcy Act 1966 (Cth), s 127)]. Many submissions to the Commission complained about the sometimes inordinate delay in commencing proceedings in respect of voidable transactions. In addition, there have been recent judicial observations critical of the general delays associated with the winding up of insolvent companies. It is therefore considered desirable to place liquidators under a more rigorous but, nonetheless, reasonable time limitation for taking action under recommends accordingly." The Commission these provisions. In BP, Spigelman CJ said of s 588FF11: "Prior to Pt 5.7B, the practice was for the court to declare a disposition to be void with the consequences left to the general law, together with some statutory powers of limited scope such as s 567 of the Corporations Law. Section 588FF(1) identifies a range of specific orders that can be made and which are more focused and more comprehensive than the orders that were hitherto available by way of relief under the general law or statute." His Honour further remarked that the original proposal in the Harmer Report had significantly been strengthened by the inclusion both by the introductory phrase "may only be made" in s 588FF(3) and also by the stipulation that an application (2003) 58 NSWLR 322. 10 Australia, The Law Reform Commission, Report No 45. 11 (2003) 58 NSWLR 322 at 344. for extension beyond the three year period had to be made within the original stipulation period12. Spigelman CJ added13: "The time limit in s 588FF(3) has the effect that at the end of the period of three years, such a person will know whether [that person] remains at risk[14]. In a legislative scheme which seeks to balance conflicting commercial interests of this character, that appears to me to be a perfectly reasonable requirement. Those who have an interest, or who represent those who have an interest, to disturb transactions must indicate, within three years, whether they wish to keep open the option of doing so. In this, as in other areas, legal policy favours certainty. Section 588FF(3) does not have the effect of requiring all applications to be brought within a short period of time. It does, however, have the effect of requiring those who wish to keep open the option to do so, to determine that they do wish to do so within the three year period and to seek a determinate extension of the period. One thing that must be decided within the three year period is how long the process of deciding Eventually, whether investigations to overcome deficiencies of information or the pursuit of funding must cease. Parliament has identified a reasonable time for such matters to occur, subject to a single determinate extension of time." to pursue voidable transactions will take. Accordingly, s 588FF is dealing, as an essential aspect of the regime it creates, with the period within which the application must be made. An application may be made only to a court invested with federal jurisdiction by one or other of the provisions of Pt 9.6A. Thereafter, and subject to any other 12 (2003) 58 NSWLR 322 at 344. 13 (2003) 58 NSWLR 322 at 345-346. 14 This observation by Spigelman CJ is not universally true, because an application can be made against, without being served on, the person at risk: but it is generally true. relevant provision of the Corporations Act, the conduct of the litigation is left for the operation of the procedures of that court. These procedures will vary from one State or Territory to another and within the court structures of those States and Territories. The scheme of the Corporations Act is not to impose a direct federal and universal procedural regime. Rather, s 79 of the Judiciary Act is left to operate according to its terms in the particular State or Territory concerned. Thus the relationship between s 588FF and s 79 (and between Pt 9.6A and s 79) is not one of which it may be said that the former provision is a law of the Commonwealth which "otherwise provides" so as to deny the operation of s 79 in this case to pick up so much of the Rules as supported the orders made by the Court of Appeal. There may be questions which arise respecting the relationship between s 79 and other provisions of the Corporations Act, including Pt 9.4B and Pt 9.5, to which reference is made earlier in these reasons. No issue of this nature arises in this appeal and no more should be said here on that possibility. Remaining question There remains a further but subsidiary point. It was suggested in the submissions for the appellant that by reason of the operation of Pt 18 r 9 of the Rules on 1 December 2003 the exercise of federal jurisdiction thereafter was spent. The application under s 588FF of the Corporations Act was taken to be dismissed by the operation of Pt 18 r 9 and the orders eventually made by the Court of Appeal under other provisions of the Rules were said to be beyond the exercise of any federal jurisdiction vested in the District Court. The answer was provided in the submissions for the Attorney-General for Victoria who intervened in support of the respondents. The circumstance that the Rules provided in the terms of Pt 18 r 9 for dismissal of that proceeding does not provide a basis for the conclusion that the federal jurisdiction was exhausted on 1 December 2003, unless it be assumed that the "dismissal" was final in all respects. The Rules, as was emphasised in the course of argument in this Court, are to be read as a whole. At all times in the District Court and in the Court of Appeal there was a proceeding in the exercise of federal jurisdiction because those Courts were seized of a "matter" arising under a law of the Parliament, namely s 588FF, in respect of which jurisdiction had been conferred on the District Court under Pt 9.6A of the same statute. Order The appeal should be dismissed with costs.

HIGH COURT OF AUSTRALIA DIRECTOR OF PUBLIC PROSECUTIONS REFERENCE NO 1 OF 2017 Director of Public Prosecutions Reference No 1 of 2017 [2019] HCA 9 20 March 2019 ORDER Appeal allowed. Set aside the order of the Court of Appeal of the Supreme Court of Victoria made on 23 March 2018 answering the point of law raised for consideration pursuant to s 308 of the Criminal Procedure Act 2009 (Vic), and in lieu thereof answer the point of law as follows: "The direction commonly referred to as the 'Prasad direction' is contrary to law and should not be administered to a jury determining a criminal trial between the Crown and an accused person." The Director of Public Prosecutions (Vic) is to pay the reasonable costs of the acquitted person. On appeal from the Supreme Court of Victoria Representation K E Judd QC with D I Piekusis for the appellant (instructed by Office of Public Prosecutions Victoria) O P Holdenson QC with J P O'Connor for the acquitted person (instructed by James Dowsley & Associates) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Director of Public Prosecutions Reference No 1 of 2017 Criminal practice – Trial – Jury directions – Prasad direction – Where accused charged with murder – Where Prasad direction given over objection at close of Crown case – Where another Prasad direction given at close of defence case – Whether Prasad direction contrary to law and should not be administered to jury determining criminal trial. Criminal practice – Jury – Reserve jurors – Where one of 13 jurors balloted off to consider response to Prasad direction – Where jury wished to hear more – Where juror balloted off re-joined jury – Where second ballot conducted to reduce jury to 12 jurors again – Where jury delivered verdicts of not guilty of murder and not guilty of manslaughter after second ballot – Whether ballot conducted at time at which "jury required to retire to consider its verdict". Words and phrases – "fair trial", "fairness to the prosecution", "jury's suggested right to stop the case", "no case submission", "power of the trial judge", "practice of inviting the jury to stop the case", "Prasad direction", "retire to consider its verdict". Criminal Procedure Act 2009 (Vic), ss 66, 213, 234, 238, 241. Juries Act 2000 (Vic), s 48. KIEFEL CJ, BELL, GAGELER, KEANE, NETTLE, GORDON AND EDELMAN JJ. The issue in this appeal is the lawfulness and propriety of directing a jury in a criminal trial that it is open at any time after the close of the prosecution case to acquit the accused if the jury consider the evidence is insufficient to support a conviction. The direction is referred to as a "Prasad direction" because it is commonly sourced to an obiter dictum of King CJ in R v Prasad1: "It is, of course, open to the jury at any time after the close of the case for the prosecution to inform the judge that the evidence which they have heard is insufficient to justify a conviction and to bring in a verdict of not guilty without hearing more. It is within the discretion of the judge to inform the jury of this right …" (emphasis added) The procedural history On 15 November 2016, an accused person was arraigned in the Supreme Court of Victoria (Lasry J) on an indictment that charged her with the murder of her de facto partner. She entered a plea of not guilty and a jury of 13 persons was empanelled2. Immediately following the close of the prosecution case, defence counsel applied to have the jury given a Prasad direction, submitting that the prosecution was unable to negative that his client was acting in self- defence. The trial judge acceded to the application and gave a Prasad direction over the prosecutor's objection. The direction was lengthy and included instruction on the elements of murder and manslaughter with particular reference to proof of the intent for murder, which was in issue. His Honour reminded the jury of the evidence that raised self-defence and instructed them of the necessity that the prosecution negative that the accused person was acting in self-defence with respect to liability for murder and manslaughter. The instruction covered the treatment of self-defence in the context of family violence under s 322M of the Crimes Act 1958 (Vic). A printed copy of the transcript of the Prasad direction, a document of some 20 pages or more, was distributed to the jury. (1979) 23 SASR 161 at 163. 2 Section 23(a) of the Juries Act 2000 (Vic) (now s 23(1)(a)) provides that, in a criminal trial, the court may order the empanelment of up to three additional jurors. Bell Nettle Gordon Edelman Before the jury withdrew to consider their response to the direction, a ballot was conducted to reduce the jury to 12 persons in case the decision was to return a verdict or verdicts of acquittal. The juror who was "balloted off" remained in the court while, in the jury room, the jury considered their response to the Prasad direction. The jury returned and advised that they wished to hear more. The juror who had been balloted off re-joined the jury and the trial continued. Following the close of the defence case, but before addresses, the trial judge reminded the jury of the continuing operation of the Prasad direction and gave them a further opportunity to consider whether they wished to hear more. A second ballot was conducted, to again reduce the jury to 12, before the jury withdrew to consider their response to the renewed Prasad direction. On their return to the court on this occasion, the jury delivered verdicts of not guilty of murder and not guilty of manslaughter. The Director of Public Prosecutions (Vic) ("the Director") referred to the Court of Appeal of the Supreme Court of Victoria a point of law that had arisen in the trial3. The Court of Appeal was asked to give its opinion on whether: "[t]he direction commonly referred to as the 'Prasad direction' is contrary to law and should not be administered to a jury determining a criminal trial between the Crown and an accused person". The reference of the point of law does not affect the trial in relation to which it was made or the acquittal4. The acquitted person appeared as contradictor in the Court of Appeal and in this Court, and was represented by junior and senior counsel. The Director agreed to pay the acquitted person's reasonable costs. The Court of Appeal The Court of Appeal (Maxwell P, Weinberg and Beach JJA) was divided on the answer to the point of law. In their joint reasons, Weinberg and Beach JJA were critical of the Director's challenge. Their Honours pointed out that the giving of a Prasad direction has been an accepted practice in Australian 3 Criminal Procedure Act 2009 (Vic), s 308(1). 4 Criminal Procedure Act, s 308(4). Bell Nettle Gordon Edelman courts for the best part of 40 years5. In their Honours' view, there is no reason in principle for holding that, in an appropriate case, the trial judge should not give a Prasad direction6. Maxwell P, in dissent, drew back from holding that the Prasad direction is contrary to law, but held that the practice of giving the direction should be "comprehensively disapproved" as it has been in England7. The majority answered the point of law in terms: "The giving of what is commonly referred to as a Prasad direction, in appropriate circumstances, is not contrary to law." In England, as Weinberg and Beach JJA observed, criticism of the practice of inviting the jury to "stop the case" and return a verdict of not guilty stems in part from the test applied to the determination of a no case submission. Following the passage of the Criminal Appeal Act 1966 (UK), which permitted the setting aside, on appeal, of unsafe or unsatisfactory verdicts, it came to be accepted in England that it was open to the trial judge to direct an acquittal if the judge assessed the prosecution case to be such that a conviction would be unsafe8. The Court of Appeal and its predecessor, the Court of Criminal Appeal, were critical in such cases of the trial judge inviting the jury to acquit, rather than assuming the responsibility personally by directing an acquittal9. 5 Director of Public Prosecutions Reference No 1 of 2017 (2018) 55 VR 551 at 610 6 Director of Public Prosecutions Reference No 1 of 2017 (2018) 55 VR 551 at 615 7 Director of Public Prosecutions Reference No 1 of 2017 (2018) 55 VR 551 at 554 [4], 569 [60], 570 [62], citing Falconer-Atlee (1973) 58 Cr App R 348, Kemp [1995] 1 Cr App R 151, R v Speechley [2004] EWCA Crim 3067 and R v Collins [2007] EWCA Crim 854. 8 R v Mansfield [1977] 1 WLR 1102 at 1106; [1978] 1 All ER 134 at 140; R v Galbraith [1981] 1 WLR 1039; [1981] 2 All ER 1060. 9 R v Young [1964] 1 WLR 717 at 720; [1964] 2 All ER 480 at 481-482; Falconer- Atlee (1973) 58 Cr App R 348 at 357. Bell Nettle Gordon Edelman The test for the determination of a no case submission settled by this Court in Doney v The Queen10 is central to understanding the difference of opinion below. Doney holds that, if there is evidence that is capable of supporting a verdict of guilty, the matter must be left to the jury11. Weinberg and Beach JJA considered that the stringency of the test provides a "compelling" reason for retaining the Prasad direction in a suitable case12. Their Honours emphasised that suitable cases will be rare and must be ones in which, without the assistance of closing addresses and a "full judicial charge", the jury are able to make a sensible assessment of whether acquittal is the just and appropriate verdict13. It follows that ordinarily the direction should not be given in a case of any significant complexity and should almost never be given in a case involving more than one accused14. Notwithstanding its length and complexity, their Honours considered that the Prasad direction given in the acquitted person's trial was impeccable; the jury had been "armed with all they needed to know in order to make sense of a simple allegation, and a simple response to that allegation"15. No question of the propriety of giving the direction in a trial in which more than 12 jurors remained was agitated before their Honours. 10 (1990) 171 CLR 207; [1990] HCA 51. 11 (1990) 171 CLR 207 at 214-215 per Deane, Dawson, Toohey, Gaudron and 12 Director of Public Prosecutions Reference No 1 of 2017 (2018) 55 VR 551 at 614 13 Director of Public Prosecutions Reference No 1 of 2017 (2018) 55 VR 551 at 615 14 Director of Public Prosecutions Reference No 1 of 2017 (2018) 55 VR 551 at 615 15 Director of Public Prosecutions Reference No 1 of 2017 (2018) 55 VR 551 at 615 Bell Nettle Gordon Edelman that the view Maxwell P's criticism was based on the "Prasad procedure"16 interferes with the division of functions between judge and jury17. His Honour illustrated what he saw as the "fundamental flaw in the Prasad procedure" by reference to a number of trials in which judges in Victoria had given a Prasad direction18. In each case the judge had ruled, or the defence had conceded, that there was a case to answer. Nonetheless, in each case the judge had come to the view, based upon his assessment of the evidence, that the case should stop. The Prasad procedure enabled the judge to invite the jury to acquit notwithstanding that the judge could not direct them to do so19. On 15 August 2018, Bell and Nettle JJ granted the Director special leave to appeal on grounds that contend that the Prasad direction is contrary to law and/or the direction should not continue to be given. As will appear, the Director's contention is that a trial judge is precluded from giving a Prasad direction either by the common law of Australia or by the statutory scheme for the conduct of trials on indictment in Victoria. For the reasons to be given, the Director's first-mentioned contention is accepted and it follows that the appeal must be allowed. The Director's concession below In Prasad, King CJ stated that it is within a trial judge's discretion to inform the jury of their right to bring in a verdict of not guilty at any time after the close of the prosecution case. In the Court of Appeal, the Director did not 16 Director of Public Prosecutions Reference No 1 of 2017 (2018) 55 VR 551 at 555 17 Director of Public Prosecutions Reference No 1 of 2017 (2018) 55 VR 551 at 554 [7], citing Doney v The Queen (1990) 171 CLR 207 at 215 per Deane, Dawson, Toohey, Gaudron and McHugh JJ. 18 Director of Public Prosecutions Reference No 1 of 2017 (2018) 55 VR 551 at 579 [93]-[94], citing R v Smart [Ruling No 5] [2008] VSC 94 at [13] per Lasry J, R v Butler [Rulings 1-10] [2013] VSC 688, R v Rapovski [Ruling No 3] [2015] VSC 356 and R v Gant [2016] VSC 662. 19 Director of Public Prosecutions Reference No 1 of 2017 (2018) 55 VR 551 at 579 [93] per Maxwell P. Bell Nettle Gordon Edelman challenge the existence of the right. The Director was content to challenge the discretion to inform the jury of the existence of the right. In this Court, the Director seeks to withdraw her concession as to the existence of the right. The acquitted person submits that the Director ought not to be allowed to resile from the concession. Notwithstanding the stance taken below, it is appropriate to permit the Director to withdraw the concession given that determination of the point of law referred for the Court of Appeal's opinion is inextricably linked to the question of whether the common law of Australia recognises the right20. As Weinberg and Beach JJA rhetorically asked, "why would it be unlawful for a judge to inform the jury of a right which it was conceded they could legitimately exercise?"21 The practice of inviting the jury to acquit Although in Australia the practice of informing the jury that they may stop the case by returning a verdict of acquittal at any time after the close of the prosecution case is commonly sourced to Prasad, it is evident that King CJ was describing a practice that his Honour regarded as unexceptional. Twenty years earlier in Raspor v The Queen, neither the Supreme Court of Victoria, sitting as a Court of Criminal Appeal, nor this Court questioned the regularity of the trial judge's invitation to the jury at the close of the prosecution case to acquit on the ground that the evidence was insufficient to make any conviction safe22. The referred point of law is to be determined upon acceptance that there has existed a practice since at least the middle of the last century of inviting the jury after the close of the prosecution case to consider acquitting the accused without hearing more in a case in which the judge assesses the evidence supporting a conviction to be tenuous ("the practice"). 20 Water Board v Moustakas (1988) 180 CLR 491 at 497 per Mason CJ, Wilson, Brennan and Dawson JJ; [1988] HCA 12; Pantorno v The Queen (1989) 166 CLR 466 at 475-476 per Mason CJ and Brennan J; [1989] HCA 18. 21 Director of Public Prosecutions Reference No 1 of 2017 (2018) 55 VR 551 at 610 22 (1958) 99 CLR 346 at 348 per Dixon CJ, Fullagar and Taylor JJ; [1958] HCA 30. Bell Nettle Gordon Edelman Recognition of the practice does not carry with it acceptance that the jury in a criminal trial possess a "long-standing right under common law"23 to return a verdict of not guilty of their own motion at any time following the close of the prosecution case ("the right"). Weinberg and Beach JJA relied on a line of English authorities in accepting the existence of the right24. As will appear, those authorities source the right in the practice. The origin of the right The origin of the right, as distinct from the development of the practice, is obscure. In Prasad25, the only authority cited for its existence is para 577 in the 39th edition of Archbold26. The paragraph, headed "R v Young", relevantly stated: "It is open to the jury, at any time after the close of the case for the prosecution, to inform the court that they are unanimously of opinion that the evidence which they have already heard is insufficient to justify a conviction. It is within the discretion of the judge to inform the jury of this right, and if he decides to do so he usually tells them at the close of the case for the prosecution that it is open to them to stop the case either immediately or at any later stage in the proceedings." (emphasis added) 23 Director of Public Prosecutions Reference No 1 of 2017 (2018) 55 VR 551 at 599 24 Director of Public Prosecutions Reference No 1 of 2017 (2018) 55 VR 551 at 599-600 [185]-[186], citing Attorney General's Reference [No 2 of 2000] [2001] 1 Cr App R 503 at 507, R v Speechley [2004] EWCA Crim 3067 at [51]-[53], R v Collins [2007] EWCA Crim 854 at [48] and R v H(S) [2011] 1 Cr App R 182 at 25 (1979) 23 SASR 161 at 163 per King CJ. 26 Archbold: Pleading, Evidence & Practice in Criminal Cases, 39th ed (1976) Bell Nettle Gordon Edelman The first reference to the right (and the practice) appeared in the 35th edition of Archbold27, following the decision of the Court of Criminal Appeal in R v Young28. Young acknowledged, and was critical of, the practice. Young said nothing as to the existence of the right. The criticism of the practice was repeated in Falconer-Atlee29, which again said nothing as to the right. The development of the practice was explained by Lawton LJ in R v Mansfield, not as the reflection of a long-standing common law right, but as a response to the limited scope for a successful no case submission prior to the passage of the Criminal Appeal Act 1966 (UK). His Lordship dated the practice to the two or three decades before the early 1960s30. The 9th edition of Powell's Principles and Practice of the Law of Evidence, a substantial reworking of the original, published in 1910, discussed the power of the judge to withdraw a civil action from the jury and the separate power of the jury to stop the case. With respect to the latter, it was stated that "[t]he jury has no right to interpose and stop the case by finding in favour of one party, until they have heard all the evidence tendered by the other party and the speech of his counsel"31. Powell's treatment of criminal trials made no reference to the jury's suggested right to stop the case32, nor did other leading texts33. 27 Archbold: Pleading, Evidence & Practice in Criminal Cases, 35th ed (1962), para 548A, inserted by Thirteenth Cumulative Supplement, 24 August 1966. 28 [1964] 1 WLR 717; [1964] 2 All ER 480. 29 (1973) 58 Cr App R 348. 30 [1977] 1 WLR 1102 at 1106; [1978] 1 All ER 134 at 139-140. 31 Odgers, Powell's Principles and Practice of the Law of Evidence, 9th ed (1910) at 32 Odgers, Powell's Principles and Practice of the Law of Evidence, 9th ed (1910) at 592, citing George (1909) 1 Cr App R 168 and Leach (1909) 2 Cr App R 72. 33 Thayer, A Preliminary Treatise on Evidence at the Common Law (1898) at 47-262, particularly at 256; Best, The Principles of the Law of Evidence, 9th ed (1902) at 67; Taylor, A Treatise on the Law of Evidence as Administered in England and (Footnote continues on next page) Bell Nettle Gordon Edelman Sir Patrick Devlin's and Professor Glanville Williams' Hamlyn Lectures on the criminal jury trial34 and Professor Langbein's study of its development35 make no reference to the right. An article published in The Solicitors' Journal in 1939 under the heading "Request to Jury to Stop Case", consistently with the history described in Mansfield, suggests that the practice was yet to emerge. The article was prompted by the decision in Alexander v H Burgoine & Sons Ltd, which concerned the propriety of counsel inviting the jury trying a civil action to dispense with the summing-up36. The burden of the article was the suggestion that it should be within the judge's power in a criminal trial, following the close of the prosecution case, to invite the jury to return a verdict of not guilty without The absence of reference to the right before the development of the practice is not to deny that on occasions English juries returned a verdict of acquittal after the close of the prosecution case38. The brief report of R v Perfitt, a trial before the Newington Sessions in 1903, records that in the course of the defence case the jury stopped the hearing and returned a verdict of not guilty, prompting counsel for the prosecution to unsuccessfully assert a right to address Ireland, 11th ed (1920), vol 1 at 28-29 §25A; Cross, Evidence (1958) at 54; Wigmore, Evidence in Trials at Common Law (1981), vol 9 at 379 §2494, 388-389 34 Devlin, Trial by Jury (1956) and Williams, The Proof of Guilt: A Study of the English Criminal Trial, 3rd ed (1963). 35 Langbein, The Origins of Adversary Criminal Trial (2003). 36 [1939] 4 All ER 568 at 569-570. 37 "Request to Jury to Stop Case" (1939) 83 The Solicitors' Journal 951 at 951. 38 R v Holden (1838) 8 Car & P 606 [173 ER 638]; and see Lawson and Keedy, "Criminal Procedure in England, Part II" (1911) 1 Journal of the American Institute of Criminal Law and Criminology 748 at 761. Bell Nettle Gordon Edelman The institution of the criminal jury trial has undergone a process of evolution reflecting, among other things, changing perceptions of the minimum content of a fair trial. It is necessary to exercise caution in treating Perfitt as illustrative of the right. A decade after Perfitt, in a trial before the Swansea Assizes the judge interrupted the cross-examination of the accused and asked the jury: "is the evidence sufficient for you?"40 The jury did not require to hear further and returned a verdict of guilty. The Court of Criminal Appeal dismissed an appeal against conviction, holding that it was a very plain case, that the jury did not want to hear more, and that they could not have found otherwise than that the prisoner was guilty41. Needless to say, it is inconceivable that today a judge might lawfully invite a jury to stop the case in order to return a verdict of guilty, much less that the invitation should be taken as evidencing the jury's common law right to do so. The English authorities The first reference to the right in the English decisions canvassed in argument below and in this Court is in Kemp42. The jury at Kemp's trial returned a verdict of guilty after being invited by the trial judge to consider whether they wanted to stop the case and acquit. On appeal to the Court of Appeal, counsel for Kemp unsuccessfully argued that the verdict was unsafe because the judge had made clear his view that the evidence did not establish guilt and "juries are often keen to register their independence and do not like to feel that they are being pushed about by the judge"43. McCowan LJ, giving the judgment of the Court, was critical of the judge's intervention in inviting the jury to consider stopping the case and acquitting, but nonetheless held that the intervention had not made the conviction unsafe44. 40 Newman (1913) 9 Cr App R 134 at 136. 41 Newman (1913) 9 Cr App R 134 at 136. 42 [1995] 1 Cr App R 151. 43 Kemp [1995] 1 Cr App R 151 at 155. 44 Kemp [1995] 1 Cr App R 151 at 155. Bell Nettle Gordon Edelman Before parting with the case, his Lordship referred to the commentary in the 1993 edition of Archbold, which now asserted45: "The right of the jury to acquit an accused at any time after the close of the case for the Crown, either upon the whole indictment or upon one or more counts, is well established at common law. Judges may remind juries of their rights in this respect at or after the close of the case for the Crown … If the observation of Roskill LJ in R v Falconer-Atlee … conflicts with this long established practice, it is submitted that it must have been per incuriam and should be ignored. It is submitted, however, that there is no conflict in view of the distinction between 'inviting a jury to acquit' and 'reminding them of their right to acquit.'" His Lordship rejected the suggestion that Roskill LJ's statements in Falconer-Atlee were to be ignored, observing that it is not always "easy to distinguish between an invitation to acquit and a mere intimation of a right to stop the case"46. There was no consideration of the "right" referred to in Archbold. His Lordship's focus was on the risk that, in informing the jury that it is open to stop the case and acquit, the result may be to leave a convicted defendant with a grievance47. Weinberg and Beach JJA, summarising the English authorities, observed that "[e]ven Collins, which represents the high-water mark of criticisms of the practice, asserts that 'it is difficult to hold that the common law right of a jury to stop a case after the close of the prosecution case no longer exists'"48. The conclusion of the Court of Appeal (Criminal Division) in this respect in R v Collins49 rested on the decisions in Falconer-Atlee, Kemp and R v 45 Kemp [1995] 1 Cr App R 151 at 155-156, citing Archbold: Pleading, Evidence and Practice in Criminal Cases (1993), vol 1 at 566 [4-312]. 46 Kemp [1995] 1 Cr App R 151 at 156. 47 Kemp [1995] 1 Cr App R 151 at 156. 48 Director of Public Prosecutions Reference No 1 of 2017 (2018) 55 VR 551 at 600 [186], citing R v Collins [2007] EWCA Crim 854 at [48]. 49 [2007] EWCA Crim 854. Bell Nettle Gordon Edelman Speechley50. Reference has already been made to two of these decisions, and, as noted, Falconer-Atlee, while critical of the practice, was silent as to the right. The third, Speechley, is important to understanding the nature of the "right" acknowledged in Collins. In Speechley, the trial judge refused to permit defence counsel to remind the jury of "their common law right to return a verdict of not guilty at any time after the close of the prosecution case"51. The Court of Appeal held the trial judge was right to rule as he did52. Their Lordships went on to say this53: "It appears to be accepted that a jury does have a right to acquit after the conclusion of the prosecution case, but we know of no case in which that right has ever been exercised other than at the invitation of the trial judge, and we are satisfied that it can only be exercised if the trial judge invites the jury to consider exercising it. That is because it is the duty of the judge to ensure that the trial is fair, both to the defence and to the prosecution, and he must therefore be in a position to decide when the time has come for the jury to be permitted to reach a decision." The Australian authorities Any ambiguity in King CJ's obiter dictum in Prasad was clarified in R v Pahuja54. His Honour made clear that the jury's power to return a verdict of not guilty at any time after the conclusion of the case for the prosecution is exercisable only upon the invitation of the trial judge55. The Australian decisions are at one in emphasising that it is within the discretion of the trial judge to give, 50 [2004] EWCA Crim 3067. 51 [2004] EWCA Crim 3067 at [50]. 52 R v Speechley [2004] EWCA Crim 3067 at [51]. 53 R v Speechley [2004] EWCA Crim 3067 at [51]. 54 (1987) 49 SASR 191. 55 R v Pahuja (1987) 49 SASR 191 at 201. Bell Nettle Gordon Edelman or to decline to give, a Prasad direction56. None affords support for the view that the jury might exercise the right in the absence of a Prasad direction. It would be surprising if it were otherwise. It cannot be that the jury possess a personal right to acquit at the close of the prosecution case regardless of the issues that arise for their determination. In cases of legal or factual complexity, a jury may not be able to return a "true verdict", consistently with the oaths taken by each juror57, without the assistance of addresses and the judge's instruction on the applicable law. The point is illustrated by Seymour v The Queen58. After being given a Prasad direction, the jury returned a verdict of not guilty in respect of one accused and indicated they would like the case against Seymour to continue. Seymour was convicted and appealed against his conviction to the Court of Criminal Appeal of New South Wales. The need for an explanation of the prosecution case of joint criminal enterprise was the evident cause of the seemingly inconsistent verdicts. Hunt A-JA was critical, in the circumstances, of the decision to give the Prasad direction, explaining that the "procedure" is premised on the jury being in a position, without the assistance of the judge or counsel, to assess the cogency of the evidence on which the prosecution relies59. Recognition by courts in Australia and England that the right is only exercisable at the invitation of the trial judge makes clear that what is being spoken of is not a right possessed by the jury. The recognition is of the discretion of the trial judge to direct the jury, after the close of the prosecution case, that they may acquit. However the direction is framed, it is in truth an invitation to consider returning a verdict of not guilty without hearing more, as 56 See, eg, R v Pahuja (1987) 49 SASR 191; Dean v The Queen (1995) 65 SASR 234 at 239 per Cox J; R v Reardon (2002) 186 FLR 1 at 32-33 [153] per Simpson J; Seymour v The Queen (2006) 162 A Crim R 576 at 595 [64]-[66] per Hunt A-JA; R v White [No 8] [2012] NSWSC 472 at [6]-[7] per R A Hulme J; Director of Public Prosecutions Reference No 1 of 2017 (2018) 55 VR 551 at 615 [264] per Weinberg and Beach JJA. 57 Juries Act, Sch 3 (Oaths by jurors – Criminal Trial). 58 (2006) 162 A Crim R 576. 59 Seymour v The Queen (2006) 162 A Crim R 576 at 595 [64]-[66]. Bell Nettle Gordon Edelman distinct from a reminder of a long-standing common law right to do so. It should be accepted that the common law of Australia does not recognise that the jury empanelled to try a criminal case on indictment have a right to return a verdict of not guilty of their own motion at any time after the close of the prosecution case. It remains, as Weinberg and Beach JJA observed, that the practice of giving a Prasad direction has a long history in the Australian jurisdictions and has not been subject to the trenchant criticism made in England. The submissions The Director submits that the practice developed from a flawed foundation: King CJ's dictum was drawn from English practice, which at the time had been subject to repeated criticism. The criticism was not confined to the desirability of the judge assuming the responsibility for directing an acquittal, but reflected recognition of risks that are equally applicable to the conduct of criminal trials in the Australian jurisdictions60. The Director submits that giving a Prasad direction seriously erodes conventional trial procedure and cuts across the quintessential fact-finding function of the jury. The Director's principal argument draws on Maxwell P's reasons, namely that the essential difficulty with the Prasad procedure is that the discretion to give the direction turns on the trial judge's assessment of the cogency of the evidence to support a verdict of guilty61, the very assessment that is entrusted to the jury. It is an assessment that should only be undertaken after the jury have had the benefit of the parties' submissions and the judge's directions as to the law. Attenuated instruction on the law given in the course of a Prasad direction is suggested to risk leading the jury into error. The Director's alternative submission is that provisions of the Criminal Procedure Act 2009 (Vic) ("the CPA") taken with the Jury Directions Act 2015 (Vic) ("the JDA"), which govern the conduct of criminal trials in Victoria, are inconsistent with the discretion to give a Prasad direction. Section 66 of the 60 R v Young [1964] 1 WLR 717 at 719-720; [1964] 2 All ER 480 at 481; Falconer- Atlee (1973) 58 Cr App R 348 at 356; R v Mansfield [1977] 1 WLR 1102; [1978] 1 All ER 134. 61 See, eg, R v Smart [Ruling No 5] [2008] VSC 94 at [13] per Lasry J. Bell Nettle Gordon Edelman CPA sets out the options available to the accused after the close of the prosecution case, which include making a submission that there is no case to answer. In the event that the trial judge accedes to such an application, s 241(2)(b) of the CPA provides that the trial judge may discharge the jury from delivering a verdict and direct that an entry of not guilty be made on the record. Notably, in the Director's submission, no provision is made under the CPA for the jury to return a verdict of not guilty following a Prasad direction. The Director's argument also relies on both s 234(1) of the CPA, which provides that the prosecution is entitled to address the jury for the purpose of summing up the evidence after the close of all evidence and before the closing address of the accused, and s 238 of the CPA, which provides that at the conclusion of addresses "the trial judge must give directions to the jury so as to enable the jury to properly consider its verdict". Finally, the Director notes that the JDA was enacted with the object of simplifying and clarifying the duties of the trial judge in directing the jury in a criminal trial62, and she submits that the absence of reference to the Prasad direction is a further indicator that the practice has not survived the statutory scheme for the conduct of criminal trials in Victoria. The acquitted person submits that nothing can be drawn from the scheme of the CPA and the JDA with respect to the continued availability of the Prasad direction. Neither the CPA nor the JDA purports to abolish the Prasad direction or to alter the common law as stated in Prasad. The "entitlement" conferred by s 234(1) of the CPA to make a prosecution address cannot be understood as absolute, given that the judge may discharge the jury and enter "not guilty" on the record following a successful no case application. More to the point, she submits that s 213(2) of the CPA preserves the powers exercisable by a trial judge at common law, which are to be understood as including the power to give a Prasad direction. The jury's role as the constitutional tribunal for the determination of questions of fact63, in the acquitted person's submission, is not diluted by 62 JDA, s 1(c). 63 R v Baden-Clay (2016) 258 CLR 308 at 329 [65] per French CJ, Kiefel, Bell, Keane and Gordon JJ; [2016] HCA 35. Bell Nettle Gordon Edelman informing them that they may return a verdict of acquittal without hearing more. She argues that there is no tension between the Prasad direction and Doney: where a Prasad direction is given, the facts remain for the jury. Concerns that the jury may be either "keen to register independence", or tempted to return a verdict of not guilty because they perceive the judge thinks this is the correct verdict, can be addressed by an appropriately worded direction emphasising the role of the jury as the trier of fact64. The acquitted person submits that the dangers associated with a Prasad direction identified in Collins illustrate why the discretion is one to be exercised "sparingly" but provide no support for the conclusion that giving the direction is contrary to law. The circumstance that the direction has not been doubted in Australia throughout its long history, in her submission, is against acceptance of the Director's argument. The direction is suggested to serve important public purposes by saving time and costs and by relieving the accused of unnecessary strain in a trial in which the evidence in support of conviction is tenuous65. Criticisms of the practice Quite apart from the view that the practice of inviting the jury to stop the case and acquit is an abnegation of the trial judge's responsibility, criticism of the practice in England has focussed on a number of practical difficulties to which it gives rise. They were distilled in Collins. In summary, the jury are deprived of the benefit of addresses by counsel and the judge's summing-up; provisional views about the acceptance of a witness's evidence may be hard to displace; juries are often keen to register their independence and may react against perceived pressure to acquit; the practice is inherently more dangerous in a complex case or one with multiple accused; the prosecution or defence may not have the opportunity to correct a mistaken understanding of their case; and there is a danger, in a case in which the defence is contemplating not calling evidence, of asking the jury if they want to hear more66. 64 R v Reardon (2002) 186 FLR 1 at 33 [157]. 65 Director of Public Prosecutions Reference No 1 of 2017 (2018) 55 VR 551 at 609 66 R v Collins [2007] EWCA Crim 854 at [49]. Bell Nettle Gordon Edelman While Australian courts have not disavowed the practice of giving Prasad directions, they too have recognised the practical dangers associated with it67. Of particular relevance, in light of the lengthy Prasad direction given at the acquitted person's trial, are King CJ's statements in Pahuja. His Honour cautioned that the direction should be used "sparingly", that the judge should bear in mind that defence evidence may strengthen the prosecution case, and that "[t]here should be nothing in the nature of a pre-trial summing up"68: "If the jury cannot properly reach a decision at that stage on the law as explained in the opening, perhaps clarified by a concise correction or explanation if necessary, it is better not to embark upon the course of action at all. A partial summing up at that stage of the trial is a serious departure from the due course of trial and is to be avoided." The Juries Act The focus of the Director's statutory challenge to the Prasad direction is the combined operation of the CPA and the JDA. Before turning to this challenge, there should be reference to the irregularity occasioned at the acquitted person's trial by the giving of a Prasad direction at a time when the jury comprised more than 12 jurors. The Juries Act allows for the empanelment of up to three additional jurors in a criminal trial69. The Juries Act does not permit the verdict in such a case to be returned by a jury of more than 12 jurors. If more than 12 jurors remain "at the time at which the jury is required to retire to consider its verdict", a ballot must be conducted to reduce the jury to 12 jurors before they retire70. If the trial is not concluded after the verdict is given (whether because it is not in respect of all the accused or not in respect of all the charges on the indictment), the juror (or 67 R v Pahuja (1987) 49 SASR 191 at 201; Dean v The Queen (1995) 65 SASR 234 at 239; R v Reardon (2002) 186 FLR 1 at 33 [157]; Seymour v The Queen (2006) 162 A Crim R 576 at 595 [64]-[66]. 68 R v Pahuja (1987) 49 SASR 191 at 201. 69 Juries Act, s 23(1)(a). 70 Juries Act, s 48(1). Bell Nettle Gordon Edelman jurors) selected in the ballot must return to the jury and continue as part of them71. A fresh ballot must be conducted each time "the jury is required to retire to consider its verdict"72. A Prasad direction is not a direction to the jury to retire to consider their verdict. Nonetheless, after having been given a Prasad direction, it is possible that the jury will return with a verdict of acquittal. It was against this possibility that the trial judge directed a ballot to reduce the jury to 12 jurors before the jury withdrew to consider whether they wished to hear more. On the jury's return, the juror who had been balloted off re-joined the jury and the trial proceeded. A second ballot was conducted before the jury again withdrew to consider whether they wished to hear more. On neither occasion was the ballot conducted "at the time at which the jury [were] required to retire to consider [their] verdict"73. On each occasion, the ballot was conducted at a time when the jury were invited to retire to consider whether they wished the trial to proceed. The Juries Act does not make any provision for the reduction of a jury to 12 jurors in order to consider a Prasad direction or for the juror (or jurors) who have been removed by ballot to re-join the jury in the event that the decision of the 12 jurors is for the trial to continue. The withdrawal of 12 jurors to consider the position in the absence of the 13th juror, that juror's return to the jury during the continuation of the trial, and the second ballot to again reduce the jury to 12 jurors, was in each instance a serious departure from the proper conduct of the trial. Unless by chance the same juror was balloted off the jury on each occasion, the conclusion is inevitable that the verdicts may have been influenced by a person who was not a member of the jury that returned them. The acquitted person acknowledged on the hearing in this Court that the provisions of the Juries Act may mean that a Prasad direction cannot be given to a jury comprising 13 or more jurors. 71 Juries Act, s 48(3). 72 Juries Act, s 48(4). 73 Juries Act, s 48(1). Bell Nettle Gordon Edelman The CPA and the JDA The Court of Appeal (Criminal Division) in Collins considered it "strongly arguable" that giving the equivalent of a Prasad direction has not survived the enactment of the Human Rights Act 1998 (UK)74. The argument, which their Lordships did not find it necessary to determine, was that the direction breaches Art 6 of the European Convention on Human Rights ("the ECHR") in that it contemplates that the jury might return a verdict without the benefit of speeches by counsel and appropriate directions by the trial judge75. The entitlement under the CPA of the prosecution to make a closing address76, and the requirement to have the trial judge give directions to the jury to enable them to properly consider their verdict77, may be thought to provide a firmer foundation for the conclusion that there is no room for the Prasad procedure than does the less prescriptive language of Art 6 of the ECHR. The Director's CPA argument does not, however, strengthen her case: if, contrary to her principal submission, there is no impediment under the common law of Australia to the giving of a Prasad direction in a criminal trial, s 213(2) of the CPA operates to preserve the power. Section 213(2) provides: "Nothing in this Act removes or limits any powers of a trial judge that existed immediately before the commencement of this Act." The Director's contention that the discretion to give a Prasad direction is not a "power" of a trial judge within the meaning of s 213(2) must be rejected. There is no reason to give the provision the confined operation for which the Director contends. As the acquitted person points out, the JDA uses the language of "power" with reference to the trial judge's direction as to the standard of proof78. Nor does the absence of reference to the Prasad direction in the CPA 74 [2007] EWCA Crim 854 at [48]. 75 R v Collins [2007] EWCA Crim 854 at [44]. 76 CPA, s 234(1). 77 CPA, s 238. 78 JDA, s 63(2). Bell Nettle Gordon Edelman and the JDA necessitate the conclusion that the power to give the direction has been abolished by implication. The common law of Australia The point of law is to be determined by consideration of whether the trial judge possesses the power to give a Prasad direction under the common law of Australia. Weinberg and Beach JJA did not expand on their conclusion that "a more rigorous approach" applied to the determination of a no case submission in Australia might provide an "all the more compelling" reason for retaining the trial judge's power to give a Prasad direction79. The saving of time and costs, and restoring the accused to his or her liberty at the earliest opportunity, may be taken to be the considerations that informed the conclusion. They are considerations that lose much of their force given that it is common ground that the Prasad direction is unsuited to any trial of legal or factual complexity or to the trial of more than one accused. The saving of time and costs is likely to be relatively modest in the case of an uncomplicated trial of a single accused. The capacity to relieve the accused of the strain of the continuation of a trial in the case of an uncomplicated trial of a single accused is to be weighed against the acknowledged dangers of the practice. Those dangers include that the jury will react adversely to the perceived pressure to acquit or that they will be influenced by the perception that the judge considers the proper verdict to be not guilty. Regardless of the care with which the direction is framed, it is difficult to overcome the risk of the latter perception. It is, after all, conventional for the judge to explain to the jury in opening remarks the expected course of the trial, including that, at the conclusion of the evidence, the jury will hear addresses of counsel followed by the judge's summing-up. A direction at the close of the prosecution case or thereafter that it is open to the jury to return a verdict of not guilty without hearing more might be thought inevitably to carry with it that the judge considers acquittal to be the appropriate verdict. 79 Director of Public Prosecutions Reference No 1 of 2017 (2018) 55 VR 551 at 614 Bell Nettle Gordon Edelman Even if it were possible to frame a Prasad direction to avoid such a perception, there remains the vice that the direction trenches on the adversarial nature of the trial. The duty of the judge is to preside impartially, ensuring that the trial is fair to each party80. The prosecution is entitled to have a full opportunity to explain the way its case is put, and to have a verdict from the jury that is based on the application of the law as explained by the judge to their factual determinations. The acquitted person's trial illustrates the problem. Even if it is accepted that the jury were not influenced by the view they perceived the trial judge to have formed, the direction was given over objection and served to prevent the prosecutor from explaining how the prosecution sought to prove the intent necessary for murder and to negative that the act causing death was done in self- defence. In these respects, the prosecution wished to rely on the statements made by the acquitted person to the "000" operator. At the time the direction was given, the trial judge had not ruled on whether the prosecution would be permitted to rely on those statements as inculpatory. Leveson LJ, giving the judgment of the Court of Appeal (Criminal Division), observed in R v H(S) that fairness to the prosecution is recognised as encompassing consideration of the interests of victims and witnesses. Once there is a case to answer, his Lordship said, they are entitled to know that the jury have "heard the case through"81. The more liberal test applied in England to the determination of a no case submission does not lessen the application of the same considerations to the conduct of criminal trials in this country. While the decision in Prasad anticipated the decision of this Court in Doney, Maxwell P was right to hold82 that King CJ's obiter dictum does not cohere with the analysis in Doney. The practice of permitting the trial judge to direct an acquittal based upon the judge's assessment of the insufficiency of the 80 Jago v District Court (NSW) (1989) 168 CLR 23 at 28 per Mason CJ; [1989] HCA 46; McInnis v The Queen (1979) 143 CLR 575 at 581-582 per Mason J; [1979] HCA 65, citing R v Cox [1960] VR 665 at 667 per Herring CJ, Lowe and Little JJ. 81 R v H(S) [2011] 1 Cr App R 182 at 197 [50]. 82 Director of Public Prosecutions Reference No 1 of 2017 (2018) 55 VR 551 at 579 Bell Nettle Gordon Edelman evidence to support a conviction was rejected in Doney as wrongly "enlarging the powers of a trial judge at the expense of the traditional jury function"83. If there is evidence (even if tenuous or inherently weak or vague) that is capable of supporting a verdict of guilty, the matter must be left to the jury84. This analysis does not sit readily with conferring on the trial judge a discretion, based upon the judge's assessment of the cogency of the evidence to support a conviction, to inform the jury that they may return a verdict of not guilty without hearing more. It is true that, in the circumstance of a Prasad direction, the jury and not the judge would make the decision as to whether the evidence was so unconvincing as not to provide a safe foundation for conviction. But, as has already been noticed85, it is difficult to exclude the possibility that a jury might be influenced by what the judge said to them about the quality of the evidence and might take the judge's invitation to stop the trial as an authoritative pronouncement that the evidence is so unsatisfactory that it is appropriate for them to stop the trial on that basis. The exercise of the discretion to give a Prasad direction based upon the trial judge's estimate of the cogency of the evidence to support conviction is inconsistent with the division of functions between judge and jury and, when given over objection, with the essential features of an adversarial trial. Moreover, to invite a jury to decide to stop a trial without having heard all of the evidence, without having heard counsel's final addresses, and without the understanding of the law and its application to the facts that only the judge's summing-up at the end of the trial can give them, is to invite the jury to decide the matter from a basis of ignorance which may be profound86. If evidence taken at its highest is capable of sustaining a conviction, it is for the jury as the constitutional tribunal of fact to decide whether the evidence establishes guilt beyond reasonable doubt. A jury is not fully equipped to make that decision until and unless they have heard all of the evidence, counsel's addresses and the judge's summing-up. Anything less falls short of the trial according to law to which both the accused and the Crown are entitled. 83 (1990) 171 CLR 207 at 215 per Deane, Dawson, Toohey, Gaudron and McHugh JJ. 84 Doney v The Queen (1990) 171 CLR 207 at 214-215 per Deane, Dawson, Toohey, 85 See [52]. 86 Seymour v The Queen (2006) 162 A Crim R 576 at 595 [66]. Bell Nettle Gordon Edelman Orders For these reasons, there should be the following orders: Appeal allowed. Set aside the order of the Court of Appeal of the Supreme Court of Victoria made on 23 March 2018 answering the point of law raised for consideration pursuant to s 308 of the Criminal Procedure Act 2009 (Vic), and in lieu thereof answer the point of law as follows: 'Prasad "The direction commonly referred to as the direction' is contrary to law and should not be administered to a jury determining a criminal trial between the Crown and an accused person." The Director of Public Prosecutions (Vic) is to pay the reasonable costs of the acquitted person.

HIGH COURT OF AUSTRALIA COREY TRAVIS FULLER-LYONS BY HIS TUTOR NITA LYONS APPELLANT AND STATE OF NEW SOUTH WALES RESPONDENT Fuller-Lyons v New South Wales [2015] HCA 31 2 September 2015 ORDER Appeal allowed with costs. Set aside orders 2, 3, 4 and 5 made by the Court of Appeal of the Supreme Court of New South Wales on 9 December 2014 and, in lieu thereof, order that the appeal to the Court of Appeal be dismissed. Remit the matter to the Court of Appeal to determine the costs of the appeal to that Court. On appeal from the Supreme Court of New South Wales Representation C T Barry QC with G J Davidson for the appellant (instructed by AC Lawyers) R J Burbidge QC with A C Casselden for the respondent (instructed by Hicksons Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Fuller-Lyons v New South Wales Torts – Negligence – Personal injury – Liability – Inferential fact-finding – Where appellant suffered severe injuries when he fell from train operated by respondent – Where primary judge found appellant fell from train as consequence of respondent's negligence – Whether New South Wales Court of Appeal erred in rejecting primary judge's finding on basis of alternative hypotheses about appellant's fall, not entailing negligence by respondent, being equally open – Whether Court of Appeal erred in rejecting primary judge's finding on basis appellant failed to exclude other possible explanations for known facts – Whether Court of Appeal erred in rejecting primary judge's finding on basis appellant failed to exclude hypothesis not explored in evidence. Words and phrases – "inferential fact-finding". FRENCH CJ, BELL, GAGELER, KEANE AND NETTLE JJ. On 29 January 2001, Corey Travis Fuller-Lyons suffered severe injuries when he fell from a train. Corey was eight years old at the time. Corey brought proceedings in the Supreme Court of New South Wales (Beech-Jones J) by his tutor claiming damages in negligence against the State of New South Wales ("the State") as the legal entity responsible for the operation of the rail network. There was no direct evidence of the circumstances of Corey's fall. The ultimate conclusion of negligence rested on inferential fact-finding. The primary judge found that, shortly before he fell, Corey had become trapped between the doors of the train before it left Morisset Station1. His Honour held the State vicariously liable for the negligent failure of a railway employee to keep a proper lookout before signalling to the guard that it was safe for the train to depart from the Station2. Judgment was entered for Corey in the amount of $1,536,954.55. The State appealed to the Court of Appeal of the Supreme Court of New South Wales (McColl and Macfarlan JJA and Sackville AJA) against the finding of liability. There was no appeal against the assessment of damages. The Court of Appeal identified alternative hypotheses that did not entail negligence on the part of railway staff3. These alternative hypotheses were, in the Court of Appeal's estimate, of equal or greater probability than the hypothesis upon which the primary judge based his conclusion of negligence4. The appeal was allowed, orders of the primary judge were set aside and judgment was entered for the State. 1 Fuller-Lyons v State of New South Wales (No 3) (2013) Aust Torts Reports ¶82-150 at 66,753 [6]; [2013] NSWSC 1672. 2 Fuller-Lyons v State of New South Wales (No 3) (2013) Aust Torts Reports 3 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 68,004 [7] per McColl JA, 68,010 [43] per Macfarlan JA (Sackville AJA agreeing at 68,014 [72]); [2014] NSWCA 424. 4 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 68,004 [8] per McColl JA, 68,010 [43] per Macfarlan JA (Sackville AJA agreeing Bell Nettle On 17 April 2015, Bell and Gageler JJ granted Corey special leave to appeal to this Court5. Five grounds of appeal express the same complaint in different ways, which is that the Court of Appeal did not undertake a "real review"6 of the evidence or the primary judge's reasons before concluding that alternative hypotheses were equally open. One aspect of this complaint is the assertion that the Court of Appeal identified an alternative hypothesis based on facts that were not in evidence. A sixth ground contends that Corey was denied the opportunity to deal with this hypothesis. The appeal must be allowed. To explain why that is so, it is necessary to refer to the evidence in some detail. The trial was heard over seven days. A number of issues that were explored in evidence may be put to one side because they fell away during the hearing or because they are the subject of unchallenged findings. Relevantly, the evidence established the following facts. The facts Corey and his older brothers, Dominic (aged 11 years) and Nathan (aged 15 years), boarded an intercity electric V-set train bound for Newcastle at Central Railway Station, Sydney. The train consisted of four double-decker cars. Corey and his brothers travelled in the lead car. External doors were located at the front and back of the car on the eastern (right-hand) and western (left-hand) sides. Each set of doors opened into a vestibule. The front and rear vestibules were separated from the saloon compartments of each deck by internal doors. Nathan and Dominic were seated in the saloon compartment. When they last saw him, Corey was in the front vestibule. A guard, Mr Meiforth, was stationed in the rear car. The train left Morisset Station at around 12:07pm. Corey fell from the train near Dora Creek at approximately 12:09pm. This was about 15 minutes after Corey parted from his brothers, leaving them in the saloon compartment. At the time Corey fell, the train was negotiating a right-hand bend at about 100 kilometres per hour. Corey landed on the western side of the train line. The western doors of the train were adjacent to the platform at Morisset Station. [2015] HCATrans 096. 6 The reference is to Fox v Percy (2003) 214 CLR 118 at 126 [25] per Gleeson CJ, Gummow and Kirby JJ; [2003] HCA 22. Bell Nettle The four pairs of external doors of the lead car were hung from the top. They were suspended from rollers that ran on an overhead track attached to the car's superstructure. The base of each door formed an inverted "U" which ran over a bar inside the threshold of the door on the floor. The doors were inset by what the primary judge estimated to be "about six inches" from the exterior of the car7. They were fitted with electro-pneumatically controlled locking motors which were centrally operated by the guard. When locked, the doors could only be opened by the guard engaging the door release switch. Once the switch was engaged, passengers were able to open the doors with the door handles. The adoption of the locking door system was intended to eliminate the known risk of passengers falling from the train. It was a controversial policy since, in the event of a loss of power or an accident, passengers remained locked in the cars until rescued. Mr Meiforth checked the external doors of each of the four cars at the terminal before the train commenced its journey. The doors were closed and Mr Meiforth conducted a "walk-through", giving them a shake to see if they could be opened. They were working properly and Mr Meiforth did not detect any sign of interference with them. After Corey's accident, a railway officer tested the doors of the lead car. The officer attempted with the aid of an assistant to force the doors apart after they had been closed. The locking mechanism was working correctly on each pair of doors. However, the officer observed signs of disturbance with both sets of doors at the front of the car. On the western side, when locked, each door was about 50mm off plumb at the base. This created a gap of about 100mm at the base of the doors. Corey could not have fallen through this gap. On the eastern side, the doors stalled momentarily during closing, creating a gap of about 350mm, and then continued to close and lock. A newton is the force capable of giving a mass of one kilogram an acceleration of one metre per second per second. The closing force of the doors for the first 230mm of travel was equivalent to approximately 7kg or 70 newtons. After the initial 230mm, the "normal closing force" of approximately 16kg or 160 newtons applied. The initial force, described as "soft nosing", was designed to prevent injury to a passenger in the event the passenger became caught between the doors as they closed. If the door came into contact with an object, 7 Six inches converts to 152.4mm. Bell Nettle including a person, in the last 230mm of closing, the force would reduce to around 7kg but then gradually increase to exert a force equivalent to approximately 20kg or 200 newtons. The electro-pneumatic locking mechanism applied pressure at the top of the doors. The stresses produced by an obstruction at the base of the door would tend to cause the door to ride up. Mr Cowling, an engineer called in the State's case, considered that the 100mm gap at the base of the front, western side doors suggested that they had been held open at Morisset Station and later forced. Mr Clemens, an engineer called in Corey's case, considered it unlikely that an eight-year-old boy forced the doors against the pressure of the door motors. Mr Clemens had experimented with forcing the doors of a V-set intercity car on an occasion in February 2000. He found that he had to use a lot more force than he had expected. He took hold of the two door handles and tried to force the doors apart with his hands. He succeeded in opening the doors "an inch, 2 inches perhaps"8. Whether the pressure on this occasion was the same as the pressure of the locking mechanism of the doors through which Corey fell was not established. Mr Meiforth said that forcing the doors against the pneumatic pressure of the locking mechanism was "very, very hard". Mr Meiforth estimated that he could force one door back over a period of 20 or 30 seconds. Mr Meiforth said he could not force both doors back under any circumstances. He considered that forcing a door apart would be "[m]uch too hard" for an eight-year-old boy, although a boy of that age could be capable of doing so if the boy had his back against one door and used both his arms to force the opposing door open. It was the State's case that Corey had deliberately interfered with the doors and that he had been assisted in this endeavour by his older brothers. In its closing submissions at trial, the State argued that the brothers' accounts – that they had searched the train looking for Corey before reporting that he was missing to Mr Meiforth – were made up to avoid either of them getting into trouble. Dominic and Nathan denied any involvement in interfering with the doors. It was not put to either brother that he had lied to Mr Meiforth, nor that he was motivated to do so by a desire to cover up his own involvement in Corey's fall. 8 Two inches converts to 50.8mm. Bell Nettle The primary judge's findings The primary judge accepted Dominic's and Nathan's denials. Nathan was 27 years old at the time of the trial and the primary judge assessed him as having been a reasonably intelligent and capable 15-year-old at the time of the incident. The primary judge reasoned that, had Nathan witnessed his younger brother fall from the train and been worried about his own complicity, the likelihood is that he would have immediately raised the alarm and made up some story to cover his role in the affair. The primary judge found that Nathan and Dominic were in the saloon compartment at the time of Corey's fall and that neither had interfered with the front doors of the car. It was not in dispute that Corey must have fallen through the front, western doors of the lead car. It was also not in dispute that this could not have occurred as the result of the doors suddenly opening or being prised open from a locked position. The locking system was such that, when the doors were locked, it was not possible for any person to open them no matter how hard the person tried9. It followed that at the time of Corey's fall, the front, western doors of the lead car could not have been locked, despite Mr Meiforth having engaged the electro-pneumatic locking system before the train left Morisset Station. The primary judge was satisfied that the only realistic means by which Corey could have generated sufficient force against the pneumatic power of the door motors to open the doors far enough to fall out was if he had his back to one door and pushed with his arms or a leg against the other. His Honour concluded that the most likely hypothesis was that, as the train left Morisset Station, Corey was caught between the doors with his back to one of them10. His Honour considered that Corey would have been able to generate sufficient power to force the doors a little further apart in the short interval before his fall. Acceptance of this hypothesis entailed that the doors closed against the span of Corey's body between his shoulders. It followed that, as the train left the Station, at least one of Corey's arms and legs was outside the train, as was part of his torso. The platform at Morisset Station is curved. It is not possible for a guard standing at the rear of the train to see all the cars of a four-car V-set intercity 9 Fuller-Lyons v State of New South Wales (No 3) (2013) Aust Torts Reports 10 Fuller-Lyons v State of New South Wales (No 3) (2013) Aust Torts Reports Bell Nettle train as it stands alongside the platform. Usually, a customer service attendant ("CSA") or other officer stood on the platform adjacent to the third car, from which position the officer could see the front cars. It was that officer's duty to signal to the guard when the train was ready to depart. On the occasions when the guard was assisted by a CSA, it was their joint responsibility to make sure members of the public were safely on the train before it departed. On the occasions when a CSA was on duty at Morisset Station, Mr Meiforth depended on the CSA to ensure that no passenger was stuck in the doors of the front cars. If no CSA was on duty, Mr Meiforth would walk out further onto the platform to a position from which he was able to see the front cars. A CSA was on duty at Morisset Station on the day of Corey's accident and Mr Meiforth accepted that he would have relied on the CSA's observations of the front cars. The CSA who had been on duty that day was deceased at the date of trial. The primary judge found that the CSA had failed to observe parts of Corey's body protruding from the train as it departed from Morisset Station. Viewed from another perspective, as the primary judge acknowledged, the presence of the CSA on the platform in a position to see the front, western doors of the lead car was a factor weighing against the inference that Corey was visibly trapped when the signal to depart was given11. However, his Honour considered that the balance of the circumstances, including the characteristics of the door and the short interval between the train departing from Morisset Station and Corey's fall, were in favour of a finding that Corey had been trapped when the doors closed12. The primary judge found that it was the responsibility of railway staff to observe that the doors were properly closed before the train departed and he held the State vicariously liable for the failure of the CSA to do so13. 11 Fuller-Lyons v State of New South Wales (No 3) (2013) Aust Torts Reports 12 Fuller-Lyons v State of New South Wales (No 3) (2013) Aust Torts Reports 13 Fuller-Lyons v State of New South Wales (No 3) (2013) Aust Torts Reports ¶82-150 at 66,775 [143], citing Henwood v Municipal Tramways Trust (SA) (1938) 60 CLR 438 at 455-456 per Dixon and McTiernan JJ; [1938] HCA 35. Bell Nettle The Court of Appeal In the Court of Appeal, the State challenged the primary judge's finding that Nathan and Dominic had not been involved in interfering with the doors at the front of the car. This challenge was rejected14. The Court of Appeal implicitly accepted the primary judge's inferential finding that Corey had fallen from the front, western doors of the lead car. The Court of Appeal also accepted the primary judge's inferential finding that the only realistic means by which Corey could have generated sufficient force to open the door far enough to fall out of the train was by having his back to one door and pushing with his arms or a leg against the opposing door15. This was an acceptance of the evidence of the capacity of an eight-year-old child to open the doors (assuming the doors had not locked) against the pneumatic pressure of the locking mechanism16. However, the Court of Appeal differed from the primary judge with respect to the capacity of the evidence to support the inference that Corey came to be positioned between the doors in this way as the result of being trapped by the doors (either accidentally or intentionally) as they closed at Morisset Station. Macfarlan JA gave the leading judgment, with which McColl JA and Sackville AJA agreed. McColl JA added some further observations in a short concurring judgment. Macfarlan JA identified two alternative hypotheses17. McColl JA may have identified a third18. Each hypothesis was based upon the 14 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 68,013 [67] per Macfarlan JA (McColl JA agreeing at 68,003 [1], Sackville AJA agreeing at 68,014 [72]). 15 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 68,009 [39] per Macfarlan JA (McColl JA agreeing at 68,003 [1], Sackville AJA agreeing at 68,014 [72]). 16 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 68,005 [17] per Macfarlan JA (McColl JA agreeing at 68,003 [1], Sackville AJA agreeing at 68,014 [72]). 17 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 18 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at Bell Nettle assumption that the front, western doors of the lead car were open while the train was at Morisset Station and that Corey had prevented the doors from closing fully before the train departed. On each of these hypotheses, it was said that any gap in the doors would not have been visible to the CSA exercising reasonable care19. The first hypothesis, to which all members of the Court subscribed, was that Corey might have used a backpack or other bag, a shoe placed lengthways, or a ball such as a basketball or soccer ball, to prevent the doors from closing ("the large object wedge hypothesis")20. A gap of this magnitude, it was said, would have permitted Corey to insert his shoulder into it and to enlarge it by pushing one of the doors with both hands whilst obtaining leverage by leaning part of his back against the other door21. Contrary to the primary judge's conclusion, the Court of Appeal considered that a manoeuvre of this kind could have been accomplished in a matter of seconds22. The second hypothesis, to which all the members of the Court also subscribed, was that the wedge that initially kept the doors from closing was Corey's shoulder, arm and leg23 ("the body wedge hypothesis"). Their Honours considered that Corey would have had the strength to make the gap larger by 19 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 68,009 [36] per Macfarlan JA (McColl JA agreeing at 68,003 [1], Sackville AJA agreeing at 68,014 [72]). 20 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 68,009 [34] per Macfarlan JA (McColl JA agreeing at 68,003 [1], Sackville AJA agreeing at 68,014 [72]). 21 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 68,009 [34], [35] per Macfarlan JA (McColl JA agreeing at 68,003 [1], Sackville AJA agreeing at 68,014 [72]). 22 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 68,010 [40] per Macfarlan JA (McColl JA agreeing at 68,003 [1], Sackville AJA agreeing at 68,014 [72]). 23 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 68,009 [36] per Macfarlan JA (McColl JA agreeing at 68,003 [1], Sackville AJA agreeing at 68,014 [72]). Bell Nettle using his arms, back and perhaps his leg24. Again, their Honours considered that Corey could have accomplished this manoeuvre within a matter of seconds25. A third hypothesis, identified by McColl JA, was that a small object might have been used to prevent the doors from closing ("the small object wedge hypothesis")26. Her Honour said that the evidence of Mr Meiforth and Mr Clemens established that an eight-year-old boy could open the doors, assuming that there was such a gap27. Her Honour reasoned that it was an available inference that Corey had kept the doors open with a small object that was not visible to the CSA, and that after the train had left Morisset Station he had used this opening to enlarge the gap to a point that allowed him to be propelled from the car as the train rounded the bend28. The small object wedge hypothesis The evidence concerning the use of small objects to obstruct the closing mechanism of the doors came from Mr Meiforth and Mr Clemens. Mr Meiforth explained that, occasionally, smokers place a small object, such as a key or a bottle, between the doors presumably to permit the smoke to escape. Mr Meiforth would remove obstructions of this kind when he encountered them. It required quite a bit of strength to remove the obstacle. Once the obstacle was removed, the doors came together and locked as they were designed to do. 24 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 68,010 [40] per Macfarlan JA (McColl JA agreeing at 68,003 [1], Sackville AJA agreeing at 68,014 [72]). 25 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 68,010 [40] per Macfarlan JA (McColl JA agreeing at 68,003 [1], Sackville AJA agreeing at 68,014 [72]). 26 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 27 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 28 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at Bell Nettle Mr Clemens also gave evidence that small objects could be used to obstruct the doors. He accepted that Corey might have obstructed the doors with his foot and progressively worked himself into the middle of the doors as the train proceeded. The cross-examiner asked whether the doors might be forced open sufficiently to allow a shoulder to pass between them. At this juncture the primary judge asked: "Q. Could an eight year old boy do that? Would he have the strength to do that? I've had an eight year old boy, he couldn't do it. But I could imagine some boys could, yes." The primary judge rejected the likelihood that Corey had obstructed the door with his foot or a small object. His Honour took into account Mr Meiforth's reaction to the proposition that an eight-year-old boy might prise or push the door open, which he characterised as "particularly telling"29. It was not open on Mr Meiforth's evidence to conclude that Corey had obstructed the doors with his foot or a small object and thereafter widened the opening sufficiently to fall from the train. Such an inference may be thought barely open on Mr Clemens' evidence. It is not evident how the small object wedge hypothesis sits with the finding, with which each member of the Court of Appeal agreed, that the only realistic means by which Corey could have generated sufficient force on his own to open the door far enough to fall out of the train was if he had his back to one door and was pushing with his arms, and perhaps a leg, against the opposing door30. A small opening would not have permitted Corey to obtain leverage with his back or shoulder. Moreover, were he successful in widening the gap created by a small object, there was the likelihood that the endeavour would dislodge the object. In that event, the doors would close and lock as they were designed to do. 29 Fuller-Lyons v State of New South Wales (No 3) (2013) Aust Torts Reports 30 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 68,009 [39] per Macfarlan JA (McColl JA agreeing at 68,003 [1], Sackville AJA agreeing at 68,014 [72]). Bell Nettle The large object wedge hypothesis There was no evidence that Corey had access to a basketball, soccer ball, backpack or other bag. The State did not submit at the trial or in the Court of Appeal that Corey may have used an object of this kind to prevent the doors from closing. When Corey was located after his fall, he was missing one shoe. There was no evidence about what type of shoes Corey was wearing and the possibility that Corey had obstructed the doors by placing the shoe lengthways was not raised. The possibility that Corey used his foot or a small object such as a soft drink can to obstruct the doors was raised by the State in its closing submissions at the trial. The submission relied on Mr Meiforth's evidence that a small object such as a glass soft drink bottle was sometimes used to prevent the doors of a V-set car from closing. Mr Clemens accepted in cross-examination that a person could stop the doors of a V-set car by placing his foot between them. The primary judge considered and rejected the suggestion that Corey might have kept the doors open at Morisset Station with his foot or a small object, such as a soft drink bottle or the like31. His Honour thought it unlikely that Corey could have squeezed himself into a small gap and somehow wiggled into a position from which he could generate the force required to open the doors sufficiently far apart to fall out32. His Honour observed that a potentially more plausible scenario was that some larger object was placed in the doors which created a larger gap making it easier for Corey to insert himself between the doors33. His Honour said it was difficult to conceive of an object large enough and sturdy enough that was available to Corey to allow this to happen34. Macfarlan JA acknowledged that there had been no exploration in evidence of the availability to Corey of items such as a backpack, basketball or 31 Fuller-Lyons v State of New South Wales (No 3) (2013) Aust Torts Reports 32 Fuller-Lyons v State of New South Wales (No 3) (2013) Aust Torts Reports 33 Fuller-Lyons v State of New South Wales (No 3) (2013) Aust Torts Reports 34 Fuller-Lyons v State of New South Wales (No 3) (2013) Aust Torts Reports Bell Nettle soccer ball35. Nonetheless, his Honour said that it was a distinct possibility that Corey had used an item of this kind and that his case had failed to exclude it36. It appears clear that Macfarlan JA's reference to backpacks, soccer balls and the like was a response to the primary judge's comment that it was difficult to conceive of a larger object that was available to Corey. It was, however, an error to reject the primary judge's inferential factual finding upon a view that Corey had failed to exclude an hypothesis that had not been explored in evidence. The body wedge hypothesis The body wedge hypothesis is the only hypothesis open on the evidence which commanded the support of more than one member of the Court of Appeal. It will be recalled that this was the hypothesis that the doors were prevented from closing by Corey's shoulder, arm and leg but not to the degree that any part of his body protruded sufficiently from the train such that it would, or should, have been visible to the CSA37. On this hypothesis, after the train left Morisset Station, Corey must have manoeuvred himself into a position with his back against one door such that he could push the opposing door sufficiently far back to fall from the train. Before considering whether it was open to conclude that this was an inference as probable as, or more probable than, the inference drawn by the primary judge, there should be reference to a controversy concerning the evidence of what the CSA should have been able to see. What should the CSA have seen? Macfarlan JA addressed this question in the course of dealing with Corey's application to file a notice of contention. Corey was seeking to uphold the primary judgment on the footing that the State was vicariously liable for the 35 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 68,009 [34] (McColl JA agreeing at 68,003 [1], Sackville AJA agreeing at 68,014 36 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 68,009 [34] (McColl JA agreeing at 68,003 [1], Sackville AJA agreeing at 68,014 37 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 68,009 [36] per Macfarlan JA (McColl JA agreeing at 68,003 [1], Sackville AJA agreeing at 68,014 [72]). Bell Nettle CSA's failure to observe any gap in the doors of the lead car38. Leave was refused because the Court of Appeal found that the contention was bound to fail39. The correctness of that conclusion is not an issue in this appeal. Corey submits that Macfarlan JA's reasons in dealing with his application reveal a misunderstanding of Mr Meiforth's evidence. This misunderstanding, he submits, may have infected the conclusion that it was reasonable to find that part of his body might have protruded from the train and not been observed by the CSA exercising reasonable care. The suggested misunderstanding arises Mr Meiforth in re-examination40: from evidence given by If something were happening at the very front doors of the train, and you were looking either from the position where the CSA was, or alternatively, to the point where you would walk in the absence of a CSA, could you observe a small opening on the doors at the front left-hand end to the car in the front? No I couldn't see it. The doors are recessed and it is very hard to see that because you are looking along a [curve], you can only see if someone is hanging out, if there is anything sticking out a foot or so, you could see it but if they are just holding something inside that recess you wouldn't see it, sir. HIS HONOUR: What about where the CSA – He should be able to see it sir, yes." 38 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 68,011 [48] per Macfarlan JA (McColl JA agreeing at 68,003 [1], Sackville AJA agreeing at 68,014 [72]). 39 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 68,012 [54] per Macfarlan JA (McColl JA agreeing at 68,003 [1], Sackville AJA agreeing at 68,014 [72]). 40 Extracted in Fuller-Lyons v State of New South Wales (No 3) (2013) Aust Torts Reports ¶82-150 at 66,758 [46]. Bell Nettle the that His Honour noted that the previous answer responded to a question directed to the position at which the CSA would ordinarily stand and to the position to which the guard would move if there was no CSA present42. Macfarlan JA said that Mr Meiforth's answer to the second question only made sense if it were understood as evidence that the CSA would see "if someone is hanging out, if there is anything sticking out a foot or so"43. Macfarlan JA considered that this conclusion gained support from the primary judge's acceptance that a small impediment preventing the doors from closing might not have been observed by a CSA exercising reasonable care44. The conclusion fails to take account of the primary judge's discussion of the evidence. The primary judge set out the passage extracted at [40] above and "Although the first question in this extract asked him to consider whether a small opening would be visible from the position of 'where the CSA was, or … to the point where you would walk in the absence of a CSA', Mr Meiforth's answer was only directed to the latter alternative. He stated that, from the position that a guard walks to when no CSA is on 41 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 68,011 [50] (McColl JA agreeing at 68,003 [1], Sackville AJA agreeing at 68,014 42 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 68,011 [50] (McColl JA agreeing at 68,003 [1], Sackville AJA agreeing at 68,014 43 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 68,012 [52] (McColl JA agreeing at 68,003 [1], Sackville AJA agreeing at 68,014 44 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 68,012 [52] (McColl JA agreeing at 68,003 [1], Sackville AJA agreeing at 68,014 [72]), citing Fuller-Lyons v State of New South Wales (No 3) (2013) Aust Torts Reports ¶82-150 at 66,775 [143]. 45 Fuller-Lyons v State of New South Wales (No 3) (2013) Aust Torts Reports Bell Nettle duty, the guard cannot observe a small opening in the door, but can observe something protruding by a foot or so. In the second answer he indicated that a person in the position of a CSA should be able to see even a small opening in the door." (emphasis added) As Macfarlan JA observed, the primary judge did not consider that the failure to observe a small impediment amounted to a want of reasonable care. Nonetheless, it is clear that the primary judge did not detect any ambiguity in Mr Meiforth's last answer: Mr Meiforth's evidence was that, from his position at the rear of the train, he would not see a small opening in the doors of the front car but the opening would be visible to a person in the CSA's position. It is unnecessary to determine whether the Court of Appeal's conclusion based on the body wedge hypothesis was tainted by the misconception concerning the evidence of what the CSA should have been able to see. Discussion Corey's case depends upon proof of three inferences of fact: that as the train left Morisset Station he was trapped between the front, western doors of the lead car; that his arm, leg and part of his torso were protruding from the car; and that the protruding parts of his body were visible to a person standing in the CSA's position on the platform. Corey's case fails if any of these inferences is not a definite conclusion of which the trier of fact is affirmatively satisfied, as distinct from merely a possible explanation for the known facts46. The conclusion that Corey fell from the front, western doors of the lead car is inevitable. The conclusion that immediately before the fall Corey must have been between the doors with his back to one (as he pushed against the opposing door) is accepted by the primary judge47 and the Court of Appeal48 to be the correct inference. If the primary judge's conclusion, that the reasonable and probable explanation for this state of affairs is that Corey was trapped 46 Jones v Dunkel (1959) 101 CLR 298 at 305 per Dixon CJ; [1959] HCA 8. 47 Fuller-Lyons v State of New South Wales (No 3) (2013) Aust Torts Reports 48 State of New South Wales v Fuller-Lyons (2015) Aust Torts Reports ¶82-189 at 68,009 [39] per Macfarlan JA (McColl JA agreeing at 68,003 [1], Sackville AJA agreeing at 68,014 [72]). Bell Nettle between the doors as they closed at Morisset Station, is a correct finding, it remains correct notwithstanding that other possible explanations for the known facts cannot be excluded49. Mr Clemens considered it probable that Corey had become trapped in the doors, or was standing in the doors, as they closed. In cross-examination, he was asked: "Q. Well then, how do you envisage that he was entrapped? Which part of him? Oh, I've got no evidence to say which part of him was trapped. But given that he fell out I'd suggest a good portion of him was caught in the doors. All right. And then what, this is at Morisset? It seems most likely to me, yes." The cross-examiner obtained Mr Clemens' agreement that Corey might have been seeking to stop the doors from closing. The cross-examination continued: "Q. He may have simply, for example, put his foot in the door, right? Yes. More likely his body I would have thought." While Mr Clemens' evidence allowed of the possibility that some eight-year-old boys might have the strength to force an opening in the doors of a V-set car against the pneumatic pressure, his evidence did not support a conclusion that this was a likely occurrence. Mr Meiforth's evidence, which impressed the primary judge, was against acceptance of the body wedge hypothesis. 49 Bradshaw v McEwans Pty Ltd (1951) 217 ALR 1 at 5-6; Luxton v Vines (1952) 85 CLR 352 at 358 per Dixon, Fullagar and Kitto JJ, 362 per McTiernan J; [1952] HCA 19; Strong v Woolworths Ltd (2012) 246 CLR 182 at 196-197 [34] per French CJ, Gummow, Crennan and Bell JJ; [2012] HCA 5. Bell Nettle The evidence was that it was not unusual for passengers to become trapped in the doors of cars as they closed at stations50. As the primary judge observed, an eight-year-old, unsupervised child might well become trapped in the closing doors of a train either accidentally or intentionally51. Acceptance that Corey had his back to one door and that he was able to force back the opposing door with his arms and a leg carries with it that, at that time, one door was against the span of Corey's back at a point between his shoulders. Necessarily, at least part of his trunk and limbs must have been protruding from the train. In light of the Court of Appeal's acceptance that Corey was in that position before his fall, the further finding that Corey came to be in this position as the result of the doors closing on him at Morisset Station is correctly characterised as the most likely inference "by a large measure"52. The Court of Appeal erred in overturning the finding for the reasons that it gave. Two further State submissions Before leaving the appeal, there should be reference to two submissions made by the State on the hearing in this Court, which do not appear to have been made below. First, it is submitted that the primary judge's finding, that Corey became trapped by the closing doors before the CSA signalled the guard, was unsupportable. Shortly put, the submission is that the guard only switches on the locking mechanism when he receives the CSA's signal. Therefore, so the argument goes, Corey could not have been trapped by the closing of the doors when the CSA gave the signal. The submission misconceives the evidence and the primary judge's finding. 50 Fuller-Lyons v State of New South Wales (No 3) (2013) Aust Torts Reports 51 Fuller-Lyons v State of New South Wales (No 3) (2013) Aust Torts Reports 52 Fuller-Lyons v State of New South Wales (No 3) (2013) Aust Torts Reports Bell Nettle The applicable Operation Manual for Electric Trains was in evidence in the State's case. Relevantly, as the primary judge noted, the manual contained "It is the guard's responsibility to give the 'all right' signal to authorise the driver to proceed and to ensure that passengers are clear of the doors prior to closing them and before giving the 'all right' bell signal to the driver. Before giving the 'all right' bell signal to the driver, the guard is to ensure that the 'doors open' indicator light (where provided on the guard's panel) is not shining and, that no person is observed to be caught in the doors." (emphasis added by the primary judge) As might be expected, the manual required that, before the signal that informs the driver that it is safe to depart from the platform is given, railway staff ensure that no person is observed to be caught in the doors. The State's second submission is that Mr Meiforth's evidence, that it would be "much too hard" for an eight-year-old boy to force open a door, was directed to a different type of train to the V-set intercity train from which Corey fell. The submission takes an answer out of context. It is unnecessary to set out the questions and answers leading to the statement. It suffices to observe that, when the evidence is read as a whole, it is clear that Mr Meiforth's opinion, that it would be "much too hard" for an eight-year-old boy to force open a door, was with respect to forcing the doors of the train in 2001. The conclusion accords with the primary judge's understanding of the evidence as it was given54. The appeal must be allowed. Orders The Court of Appeal ordered Corey to pay the State's costs of the proceedings at first instance and on appeal (order 5). Corey seeks orders setting 53 Fuller-Lyons v State of New South Wales (No 3) (2013) Aust Torts Reports 54 Fuller-Lyons v State of New South Wales (No 3) (2013) Aust Torts Reports Bell Nettle aside orders of the Court of Appeal, including order 5. The orders that he seeks would leave in place Beech-Jones J's special costs order. Corey does not seek an order for his costs of the proceedings in the Court of Appeal. He asks for an order that the matter be remitted to the Court of Appeal to determine any special order for costs in that Court that could have been sought upon dismissal of the appeal. The State makes no submissions on the form of any costs order. In the circumstances, it is appropriate to make the order sought. Corey seeks an order that the State pay his costs of the appeal in this Court. He also asks for directions in the event that he applies for a special order for the costs of the proceedings in this Court in substitution for the order that he claims. In the absence of an application for such an order, those directions will not be given. The following orders should be made: Appeal allowed with costs. Set aside orders 2, 3, 4 and 5 made by the Court of Appeal of the Supreme Court of New South Wales on 9 December 2014 and, in lieu thereof, order that the appeal to the Court of Appeal be dismissed. Remit the matter to the Court of Appeal to determine the costs of the appeal to that Court.

HIGH COURT OF AUSTRALIA HEATHER MARJORIE OSLAND APPELLANT AND SECRETARY TO THE DEPARTMENT OF JUSTICE RESPONDENT Osland v Secretary to the Department of Justice [2010] HCA 24 23 June 2010 ORDER The appeal be allowed with costs. The order of the Court of Appeal of the Supreme Court of Victoria made on 7 April 2009 be set aside and, in lieu thereof, it be ordered that the appeal from the order of the Victorian Civil and Administrative Tribunal made on 16 August 2005 be dismissed. The following orders of this Court be vacated: par 6 of the orders made by Hayne J on 27 October 2009; par 2 of the orders made by Kiefel J on 4 February 2010; and par 6 of the orders made by Hayne J on 18 March 2010. The appellant's counsel and solicitor and senior counsel's secretaries be released from the written undertakings they provided to the respondent in relation to this appeal. On appeal from the Supreme Court of Victoria Representation R Merkel QC with J B R Beach QC and R H M Attiwill for the appellant (instructed by Hunt & Hunt) P M Tate SC, Solicitor-General for the State of Victoria with S B McNicol and C P Young for the respondent (instructed by FOI Solutions) Intervener S J Gageler SC, Solicitor-General of the Commonwealth with D F O'Leary intervening on behalf of the Attorney-General of the Commonwealth (instructed by Australian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Osland v Secretary to the Department of Justice Administrative law – Freedom of information – Exempt documents – Petition for mercy denied by Governor acting on advice of Attorney-General – Attorney- General had received legal advice from various sources – Attorney-General issued press release mentioning advice from one source that petition should be denied but did not mention advice from other sources – Freedom of information request by petitioner for all advices granted upon review by Victorian Civil and Administrative Tribunal ("VCAT") – VCAT of opinion that public interest required access to all advices to be granted – Whether open to VCAT to form opinion that public interest required access to be granted – Relevance of differences between advices. Administrative law – Judicial review – Where Victorian Civil and Administrative Tribunal Act 1998 (Vic) ("Act") provided for appeal to Court of Appeal on a question of law and empowered Court of Appeal to make orders on appeal including orders VCAT "could have made" – VCAT of opinion that public interest required disclosure of all advices – Court of Appeal examined advices and formed own view, without considering the correctness of VCAT's analysis, that public interest did not require access to be granted – Nature of "appeal" under Act – Whether VCAT decision attended by error of law. Words and phrases – "appeal", "exempt documents", "public interest". Freedom of Information Act 1982 (Vic), ss 32, 50(4). Victorian Civil and Administrative Tribunal Act 1998 (Vic), ss 148(1), 148(7). FRENCH CJ, GUMMOW AND BELL JJ. Introduction On 2 October 1996, the appellant, Mrs Osland, was convicted in the Supreme Court of Victoria of the murder of her husband. On 12 November 1996, she was sentenced to a term of 14½ years imprisonment with a non-parole period of nine and a half years. Applications for leave to appeal against her conviction and sentence were dismissed by the Court of Appeal of the Supreme Court of Victoria on 1 August 19971. An appeal to this Court was dismissed on 10 December 19982. On 5 July 1999, Mrs Osland petitioned the Attorney-General for Victoria seeking a pardon in the exercise of the royal prerogative of mercy. That is a prerogative vested in the Queen and exercisable by the Governor of Victoria, acting on the advice of the Premier3. As a matter of practice, the Premier acts on the advice of the Attorney-General4. While the petition was under consideration there was a State election and a change of government with a new Attorney- General5. In Mrs Osland's case, advice was received from, inter alia, the Victorian Government Solicitor (VGS), the Crown Prosecutors in the case, the Department of Justice, a senior counsel, Robert Redlich QC6, and a panel of three senior counsel, Susan Crennan QC, Jack Rush QC and Paul Holdenson QC. On 6 September 2001, the Attorney-General issued a press release in the following terms: "On July 5, 1999, Mrs Osland submitted a petition for mercy to the then- Attorney General, Jan Wade. That petition set out six grounds on which the petition should be granted. 1 R v Osland [1998] 2 VR 636. 2 Osland v The Queen (1998) 197 CLR 316; [1998] HCA 75. 3 Australia Act 1986 (Cth), s 7(2) and (5); Constitution Act 1975 (Vic), s 87E(b). See Taylor, The Constitution of Victoria, (2006) at 103-104, 115-120. 4 Taylor, The Constitution of Victoria, (2006) at 104. 5 See Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 284 [10]; [2008] HCA 37. 6 Who was assisted by junior counsel, Trish Riddell. Bell Following consultation with the State Opposition, I appointed a panel of three senior counsel, Susan Crennan QC, Jack Rush QC and Paul Holdenson QC, to consider Mrs Osland's petition. This week I received a memorandum of joint advice from the panel in relation to the petition. The joint advice recommends on every ground that the petition should be denied. After carefully considering the joint advice, I have recommended to the Premier that the Governor be advised to deny the petition. The Governor has accepted this advice and denied the petition." Mrs Osland applied under the Freedom of Information Act 1982 (Vic) ("the FOI Act") for access to all of the advices provided to the Attorney-General and associated departmental correspondence. On 2 January 2002, access was denied by an officer of the Department of Justice and again, on 8 February 2002, by an authorised delegate of the Secretary to the Department of Justice ("the Secretary") making a fresh decision pursuant to an internal review7. Access was denied on the basis, inter alia, that the documents attracted legal professional privilege8. Mrs Osland applied for review of the delegate's decision to the Victorian Civil and Administrative Tribunal ("the Tribunal"). On 16 August 2005, the Tribunal, constituted by its President (Morris J), set aside the delegate's decision and ordered that Mrs Osland be given access to the relevant documents9. In so doing, his Honour referred to the possible existence of differences between the advices10. He did not, however, decide the case on the basis of those differences11. The Secretary applied to the Court of Appeal, under s 148 of the Victorian Civil and Administrative Tribunal Act 1998 (Vic) ("the VCAT Act"), for leave to appeal on questions of law from the order of the Tribunal. Leave was granted on 14 October 2005, the appeal heard on 5 June 2006 and judgment 7 FOI Act, s 51. 8 A category of exempt documents pursuant to s 32(1) of the FOI Act. 9 Re Osland and Department of Justice (2005) 23 VAR 378 at 393 [55]. 10 Re Osland and Department of Justice (2005) 23 VAR 378 at 392 [52]. 11 Re Osland and Department of Justice (2005) 23 VAR 378 at 392-393 [53]. Bell delivered on 17 May 200712. The Court of Appeal set aside the order of the Tribunal and affirmed the decision of the delegate. It did so without examining the disputed documents13. Special leave to appeal to this Court against that decision was granted on 14 December 2007. On 7 August 2008, this Court allowed the appeal against the decision of the Court of Appeal, set aside the orders of the Court of Appeal and remitted the matter to that Court for further hearing in accordance with the reasons of this Court14. It did so on the basis that the Court of Appeal had erred in holding, without examining the disputed documents, that differences between the advices could not support the application of s 50(4) of the FOI Act, which provides for the grant of access to documents otherwise exempt from disclosure where, in the opinion of the Tribunal, the public interest so requires15. This provision establishes what has come to be known as the "public interest override"16. On 7 April 2009, the Court of Appeal (Maxwell ACJ, Ashley JA and Bongiorno AJA) again allowed the appeal from the order of the Tribunal, directed that the order of the Tribunal be set aside and in lieu thereof ordered that the decision of the delegate be affirmed17. Special leave to appeal against the decision of the Court of Appeal was granted by this Court on 12 February 2010. The appeal raises the question whether the Court of Appeal did what was required of it on the remitter. For the reasons that follow, that question must be answered in the negative and the appeal allowed. In essence, the Court of Appeal's reasoning on the remitter was independent of the actual contents of the disputed documents. It is necessary, before considering the nature of that Court's task on the remitter, to refer to the relevant statutory context. 12 Secretary, Department of Justice v Osland (2007) 95 ALD 380. 13 See Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 299 [52]. 14 Osland v Secretary, Department of Justice (2008) 234 CLR 275. 15 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 300-301 [57] per Gleeson CJ, Gummow, Heydon and Kiefel JJ. 16 See Re Hulls and Victorian Casino and Gaming Authority (1997) 11 VAR 213 at 220; Secretary to the Department of Premier and Cabinet v Hulls [1999] 3 VR 331 at 340 [26] per Phillips JA. 17 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590. Bell The Freedom of Information Act 1982 (Vic) The FOI Act creates a general, legally enforceable right to obtain access to documents of agencies and official documents of Ministers18. The right does not extend to "exempt" documents. The stated object of the FOI Act, in s 3(1), is "to extend as far as possible the right of the community to access to information in the possession of the Government of Victoria and other bodies constituted under the law of Victoria for certain public purposes". In s 3(2) it is said to be "the intention of the Parliament that the provisions of this Act shall be interpreted so as to further the object set out in sub-section (1)". Section 16(1) requires Ministers and agencies to administer the FOI Act with a view to making the maximum amount of government information available to the public. And, by s 16(2), nothing in the FOI Act is intended to prevent or discourage Ministers or agencies from publishing or giving access to documents, including exempt documents, otherwise than as required by the FOI Act, where they can properly do so or are required by law to do so19. Where a request is made by a person to an agency or a Minister for access to a document of the agency or an official document of the Minister and the relevant charge is paid, the person requesting shall be given access to the document in accordance with the FOI Act. But the obligation thus imposed on the agency or Minister does not extend to giving access to an exempt document20. The FOI Act sets out various classes of exempt documents. One such class is specified in s 32(1): "A document is an exempt document if it is of such a nature that it would be privileged from production in legal proceedings on the ground of legal professional privilege." 18 FOI Act, s 13. 19 An example relevant to the present case is the capacity of a Minister to waive legal professional privilege in relation to a document containing legal advice. 20 FOI Act, s 20(1) and (2). Bell Another class, defined in s 30, comprises internal working documents whose disclosure "would be contrary to the public interest". Where a decision to grant access to a document in accordance with a request is refused, the applicant for access may apply to the Tribunal for a review of that decision21. Section 50(4) provides: "On the hearing of an application for review the Tribunal shall have, in addition to any other power, the same powers as an agency or a Minister in respect of a request, including power to decide that access should be granted to an exempt document (not being a document referred to in section 28, section 29A, section 31(3), or in section 33) where the Tribunal is of opinion that the public interest requires that access to the document should be granted under this Act." Relevantly to this appeal, the exercise of the power conferred by s 50(4) requires satisfaction of two conditions. The first is the condition that, as a matter of law, the material before the Tribunal is capable of supporting the formation by it of an opinion that the public interest requires that access to the documents should be granted. That condition may also be expressed as a limitation, namely, that the opinion referred to by the sub-section is an opinion which is such that it can be formed by a reasonable decision-maker who correctly understands the meaning of the law under which that decision-maker acts22. The second 21 FOI Act, s 50(2)(a). 22 R v Connell; Ex parte The Hetton Bellbird Collieries Ltd (1944) 69 CLR 407 at 430-432 per Latham CJ; [1944] HCA 42; Avon Downs Pty Ltd v Federal Commissioner of Taxation (1949) 78 CLR 353 at 360 per Dixon J; [1949] HCA 26. See also Buck v Bavone (1976) 135 CLR 110 at 118-119 per Gibbs J; [1976] HCA 24; Foley v Padley (1984) 154 CLR 349 at 353 per Gibbs CJ, 369-370 per Brennan J; [1984] HCA 50; Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259 at 275-276 per Brennan CJ, Toohey, McHugh and Gummow JJ; [1996] HCA 6; Minister for Immigration and Multicultural Affairs v Eshetu (1999) 197 CLR 611 at 652-654 [133]-[137] per Gummow J; [1999] HCA 21; Coal and Allied Operations Pty Ltd v Australian Industrial Relations Commission (2000) 203 CLR 194 at 208-209 [31] per Gleeson CJ, Gaudron and Hayne JJ (who observed that the Full Bench of the Commission would have committed jurisdictional error if it misunderstood the nature of the opinion it was to form); [2000] HCA 47; Minister for Immigration and Multicultural Affairs v Jia Legeng (2001) 205 CLR 507 at 532 [73] per Gleeson CJ and Gummow J; [2001] HCA 17; Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 419 [82] per (Footnote continues on next page) Bell condition is that the Tribunal actually forms the opinion that the public interest requires that access to the documents should be granted. This is an evaluative and essentially factual judgment. If the Tribunal forms the requisite opinion, its power to grant access is enlivened. In the ordinary case, the exercise of the power will be subsumed in the formation of the necessary opinion. The FOI Act neither defines nor expressly limits the range of matters relevant to the "public interest" which may require that access should be granted. As was said in the joint judgment in this Court on the first appeal, "[t]here are obvious difficulties in giving the phrase 'public interest' as it appears in s 50(4) a fixed and precise content"23. The nature of "public interest" determinations in the exercise of statutory powers was described in O'Sullivan v Farrer24: "the expression 'in the public interest', when used in a statute, classically imports a discretionary value judgment to be made by reference to undefined factual matters, confined only 'in so far as the subject matter and the scope and purpose of the statutory enactments may enable … given reasons to be [pronounced] definitely extraneous to any objects the legislature could have had in view'". The power to grant access on public interest grounds is not, in terms, vested in the relevant Minister or agency. By virtue of s 16 they retain their freedom to grant access to exempt documents25. Rather, it is a power included in the powers conferred on the Tribunal26. In this respect it is unique in freedom of information legislation in Australia27. It has been called a "significant and Gaudron J, 446-447 [167] per Gummow and Hayne JJ, 502 [329] per Kirby J; [2001] HCA 51. 23 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 300 [57] per Gleeson CJ, Gummow, Heydon and Kiefel JJ. 24 (1989) 168 CLR 210 at 216 per Mason CJ, Brennan, Dawson and Gaudron JJ; [1989] HCA 61 quoting Dixon J in Water Conservation and Irrigation Commission (NSW) v Browning (1947) 74 CLR 492 at 505; [1947] HCA 21 (editing in original). 25 FOI Act, s 16(2). 26 Secretary to the Department of Premier and Cabinet v Hulls [1999] 3 VR 331 at 339 [23] per Phillips JA, Tadgell and Batt JJA agreeing. 27 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 288 [21] per Gleeson CJ, Gummow, Heydon and Kiefel JJ. Bell exceptional" power28 and "a most extraordinary provision"29. These epithets do not justify its characterisation, propounded by the Secretary, as a power to be exercised only in "exceptional circumstances"30. Those words are not in the statutory text. Their use may misdirect the inquiry required by s 50(4). They may be taken erroneously to limit the range of matters relevant to the public interest. Nor do they sit easily with the proper approach to the construction of the FOI Act, which is to "further, rather than hinder, free access to information" under it31. Having said that, it must be accepted that the word "requires" which appears in s 50(4) directs the decision-maker to identify a high-threshold public interest before the power can be exercised. It is not enough that access to the documents could be justified in the public interest. The terminology of the sub- section does not define a rule so much as an evaluative standard requiring restraint in the exercise of the power. It is, like many common law standards, "predicated on fact-value complexes, not on mere facts"32, to be applied by the decision-maker. The reasoning in the Tribunal The President began by rejecting a contention advanced on behalf of Mrs Osland that the Attorney-General had waived legal professional privilege in the joint advice by his reference to it in the press release33. The exempt status of the documents therefore stood, and he turned next to the public interest override in s 50(4), making reference to general considerations of transparency in government, public confidence in the criminal justice system, particularly the exercise of the prerogative of mercy, and the unique character of the Osland case34. He also referred to the irrelevance of the disputed documents to current or 28 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 313 [100] per 29 Secretary to the Department of Premier and Cabinet v Hulls [1999] 3 VR 331 at 341 [28] per Phillips JA. 30 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 317 [116] per 31 Victorian Public Service Board v Wright (1986) 160 CLR 145 at 153; [1986] HCA 32 Stone, Legal System and Lawyers' Reasonings, (1964) at 264. 33 Re Osland and Department of Justice (2005) 23 VAR 378 at 388-389 [36]-[37]. 34 Re Osland and Department of Justice (2005) 23 VAR 378 at 391-392 [48]-[50]. Bell prospective government decision-making and the attenuation, by passage of time, of the weight to be given to legal professional privilege attaching to them35. His reasons were summarised in the joint judgment of this Court on the first appeal36. It is not necessary to repeat that summary here. In his reasons the President also referred, albeit obliquely and in rather hypothetical language, to the case of a decision-maker who has been provided with differing advices37. As was said in the joint judgment in this Court, he38: "made no finding that [the advices] were materially different, but after referring to the potential significance of difference he spoke of 'powerful reasons' for making the conclusions of the VGS advices and the Redlich advice available to the public. It is difficult (and would have been difficult for the Court of Appeal) to know whether he was merely referring to possible speculation by members of the public that there may have been significant differences, or whether he was indicating that his own examination of the documents revealed such differences." As appears from the President's reasons for decision, the Secretary had advanced a secondary claim for exemption based on s 30 of the FOI Act by characterising the documents as internal working documents. The President said he could not uphold that claim for exemption if he were to form the opinion pursuant to s 50(4) that the public interest required access to be given notwithstanding the exempt status of the documents by virtue of s 3239. The jurisdiction and powers of the Court of Appeal It is necessary to refer to the nature of the jurisdiction and powers of the Court of Appeal in an appeal from an order of the Tribunal. That jurisdiction and those powers continued to define the functions of the Court on the remitter of the appeal for further hearing. The relevant jurisdiction and powers are set out in s 148 of the VCAT Act, which provides, inter alia: 35 Re Osland and Department of Justice (2005) 23 VAR 378 at 391 [46]. 36 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 289-290 [25]- 37 Re Osland and Department of Justice (2005) 23 VAR 378 at 392-393 [52]-[53]. 38 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 290-291 [28]. 39 Re Osland and Department of Justice (2005) 23 VAR 378 at 386 [28]. Bell "Appeals from the Tribunal (1) A party to a proceeding may appeal, on a question of law, from an order of the Tribunal in the proceeding— to the Court of Appeal, if the Tribunal was constituted for the purpose of making the order by the President or a Vice President, whether with or without others; or to the Trial Division of the Supreme Court in any other case— if the Court of Appeal or the Trial Division, as the case requires, gives leave to appeal. The Court of Appeal or the Trial Division, as the case requires, may make any of the following orders on an appeal— an order affirming, varying or setting aside the order of the Tribunal; an order that the Tribunal could have made in the proceeding; an order remitting the proceeding to be heard and decided again, either with or without the hearing of further evidence, by the Tribunal in accordance with the directions of the court; any other order the court thinks appropriate." Section 148 confers "judicial power to examine for legal error what has been done in an administrative tribunal"40. Despite the description of proceedings under the section as an "appeal", it confers original not appellate jurisdiction; the proceedings are "in the nature of judicial review"41. 40 Roy Morgan Research Centre Pty Ltd v Commissioner of State Revenue (Vict) (2001) 207 CLR 72 at 79 [15] per Gaudron, Gummow, Hayne and Callinan JJ; [2001] HCA 49. 41 Roy Morgan Research Centre Pty Ltd v Commissioner of State Revenue (Vict) (2001) 207 CLR 72 at 79 [15] per Gaudron, Gummow, Hayne and Callinan JJ. Bell The jurisdiction conferred by s 148(1) is confined to appeals on questions of law. Section 148(7) does not enlarge that jurisdiction. It confers powers on the court in aid of its exercise42. That feature of s 148 resembles s 44 of the Administrative Appeals Tribunal Act 1975 (Cth) ("the Commonwealth AAT Act"), which defines the analogous jurisdiction of the Federal Court to hear appeals on questions of law against decisions of the Administrative Appeals Tribunal (AAT). Under s 44(4) of the Commonwealth AAT Act, the Federal Court, in determining an appeal, may "make such order as it thinks appropriate by reason of its decision". But wide as that power may be, the Court "should not usurp the fact-finding function of the AAT"43. Those observations turn upon the text of s 44. They do not depend upon the separation of judicial and executive powers, which limits the functions that can be conferred upon federal courts. They have application to the jurisdiction conferred upon the Court of Appeal by s 148 of the VCAT Act, which is, in concept and in terms, modelled on, although not identical to, s 4444. 42 The distinction between jurisdiction and power has been made repeatedly in this Court: Thomson Australian Holdings Pty Ltd v Trade Practices Commission (1981) 148 CLR 150 at 161-162 per Gibbs CJ, Stephen, Mason and Wilson JJ; [1981] HCA 48; Jackson v Sterling Industries Ltd (1987) 162 CLR 612 at 616 per Mason CJ, 619 per Wilson and Dawson JJ, 627-628 per Toohey J; [1987] HCA 23; Patrick Stevedores Operations No 2 Pty Ltd v Maritime Union of Australia (1998) 195 CLR 1 at 29 [27]-[28], 32 [35] per Brennan CJ, McHugh, Gummow, Kirby and Hayne JJ; [1998] HCA 30; Lipohar v The Queen (1999) 200 CLR 485 at 516- 517 [78] per Gaudron, Gummow and Hayne JJ; [1999] HCA 65; Australian Securities and Investments Commission v Edensor Nominees Pty Ltd (2001) 204 CLR 559 at 590 [64]-[65] per Gleeson CJ, Gaudron and Gummow JJ; [2001] HCA 1; Keramianakis v Regional Publishers Pty Ltd (2009) 237 CLR 268 at 280 [36] per French CJ; [2009] HCA 18. 43 Repatriation Commission v O'Brien (1985) 155 CLR 422 at 430 per Gibbs CJ, Wilson and Dawson JJ; [1985] HCA 10. See also Harris v Director-General of Social Security (1985) 59 ALJR 194 at 198 per Gibbs CJ, Brennan, Deane and Dawson JJ; 57 ALR 729 at 735-736; [1985] HCA 1; cf Roncevich v Repatriation Commission (2005) 222 CLR 115 at 126 [28] per McHugh, Gummow, Callinan and Heydon JJ, 146 [101] per Kirby J; [2005] HCA 40. 44 The VCAT Act replaced the Administrative Appeals Tribunal Act 1984 (Vic), which was inspired by the Commonwealth AAT Act, as appears from the Second Reading Speech for the Administrative Appeals Tribunal Bill 1984: Victoria, Legislative Assembly, Parliamentary Debates (Hansard), 20 September 1984 at (Footnote continues on next page) Bell The Court of Appeal, in the exercise of its jurisdiction under s 148 of the VCAT Act, may make substitutive orders where only one conclusion is open on the correct application of the law to the facts found by the Tribunal. Such a case arises when no other conclusion could reasonably be entertained45. In that event, the Court can make the order that the Tribunal should have made. The language of s 148(7) is also wide enough to allow the Court of Appeal to make substitutive orders in other circumstances. But its powers must, as with the equivalent powers of the Federal Court in relation to the AAT, be exercised having regard to the limited nature of the appeal. Absent such restraint, a question of law would open the door to an appeal by way of rehearing. Where there is a factual matter that has to be determined as a consequence of the appeal, it may be that it is able conveniently to be determined by the Court of Appeal upon uncontested evidence or primary facts already found by the Tribunal. When the outstanding issue involves the formation of an opinion which is, as in this case, based upon considerations of public interest, then it should in the ordinary case be remitted to the body established for the purpose of making that essentially factual, evaluative and ministerial judgment. The first decision of the Court of Appeal There is a need for better definition of the questions of law upon an appeal to the Court of Appeal under s 148 of the VCAT Act than appeared in these proceedings. The questions of law are not to be distilled from the grounds of appeal46. What Gummow J said of s 44 of the Commonwealth AAT Act in TNT Skypak International (Aust) Pty Ltd v Federal Commissioner of Taxation is true also of s 14847: "The existence of a question of law is … not merely a qualifying condition to ground the appeal, but also the subject matter of the appeal itself". 664-665. Section 52 of the Administrative Appeals Tribunal Act 1984 (Vic) resembled s 44 of the Commonwealth AAT Act. 45 Repatriation Commission v O'Brien (1985) 155 CLR 422 at 430 per Gibbs CJ, 46 Australian Securities and Investments Commission v Saxby Bridge Financial Planning Pty Ltd (2003) 133 FCR 290 at 301-302 [47]-[48] per Branson J, 313 [108] per Jacobson and Bennett JJ. 47 (1988) 82 ALR 175 at 178. Bell The relevant question of law brought to the Court of Appeal was formulated in the notice of appeal from the Tribunal in the following uninformative terms: "Was the Judge correct in articulating the contents of the public interest for the purposes of s 50(4) of the Freedom of Information Act 1982 (Vic)"? The Court first rejected a notice of contention asserting waiver by the Attorney-General of the legal professional privilege attaching to the joint advice mentioned in the press release. Separate reasons for decision were published by Maxwell P, Ashley JA and Bongiorno AJA. After disposing of the notice of contention, the Court focussed upon the Tribunal's approach to the term "the public interest requires" in s 50(4)48. It held, inter alia, that the "public interest" to which the sub-section referred did not extend to "questions of general policy" or "abstract policy considerations"49. It also held that the President of the Tribunal erred in his disposition of the Secretary's argument based on s 30, which asserted an exempt status for the documents deriving from their character as internal working documents. Maxwell P said50: "That point alone would be sufficient to justify upholding the secretary's appeal." In the event, the appeal to the Court of Appeal succeeded on three grounds: The Tribunal erred in distinguishing, in the application of s 50(4), the stringency of legal professional privilege attaching to the disputed documents depending upon whether the legal advices therein contained were "'of historical interest' only" or of matters "under active consideration"51. 48 Secretary, Department of Justice v Osland (2007) 95 ALD 380 at 403-405 [92]- [103] per Maxwell P (with whose analysis on this point Ashley JA agreed at 408 [113]), 409-410 [121]-[122] per Bongiorno AJA. 49 Secretary, Department of Justice v Osland (2007) 95 ALD 380 at 402 [88], 403 [94] per Maxwell P, 408 [114] per Ashley JA, 409 [120] per Bongiorno AJA. 50 Secretary, Department of Justice v Osland (2007) 95 ALD 380 at 400 [78]. 51 Secretary, Department of Justice v Osland (2007) 95 ALD 380 at 400 [81], 401 [84] per Maxwell P (with whom, on this point, Ashley JA agreed at 408 [113]). Bell The Tribunal conflated "matters of public interest" with the phrase "in the public interest"52. The Tribunal failed to determine whether the disputed documents were exempt under s 30(1) of the FOI Act before proceeding to determine whether the public interest required that access should be granted under As appears from the preceding, the legal errors which the Court of Appeal identified did not depend upon a consideration of the contents of the disputed documents. As to the possible existence of differences between the advices adverted to by the Tribunal's President, Bongiorno AJA said that the existence of such differences was a reason against, rather than in favour of, releasing the documents. Their release would enable a political collateral attack on the exercise of the prerogative of mercy, which would have the effect of changing its fundamental nature54. Each of the judges in the Court of Appeal, for somewhat different reasons, concluded that the circumstances of the case gave rise to no public interest consideration capable of satisfying the test in s 50(4)55. A fuller account of the reasoning of the Court of Appeal is found in the judgment of this Court on appeal from the Court of Appeal's first decision56. Instead of remitting the matter to the Tribunal, the Court of Appeal set aside its decision and affirmed the decision of the delegate without any 52 Secretary, Department of Justice v Osland (2007) 95 ALD 380 at 402-403 [90]- [91] per Maxwell P (with whom, on this point, Ashley JA agreed at 408 [113]), 411 [129] per Bongiorno AJA. 53 Secretary, Department of Justice v Osland (2007) 95 ALD 380 at 399-400 [73]- [78] per Maxwell P. His Honour identified the relevant error at 399 [77], with which Ashley JA agreed at 408 [113]. 54 Secretary, Department of Justice v Osland (2007) 95 ALD 380 at 411 [127]-[128]. 55 Secretary, Department of Justice v Osland (2007) 95 ALD 380 at 405 [103] per Maxwell P, 409 [119] per Ashley JA, 409 [120] per Bongiorno AJA. 56 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 294-296 [41]- [43] per Gleeson CJ, Gummow, Heydon and Kiefel JJ. Bell consideration of the possible operation of s 50(4) in light of the contents of the disputed documents. It was that omission which led to the first appeal to this Court. This Court's reasons on the first appeal On the first appeal from the Court of Appeal, this Court rejected a challenge by Mrs Osland to the conclusion by the Court of Appeal, supportive of the Tribunal's finding, that the Attorney-General had not waived legal professional privilege in relation to the joint advice referred to in the press release. The remaining ground of appeal before this Court was "directed to a specific aspect of the way in which the Court of Appeal dealt with the 'public interest override'"57. As set out in the notice of appeal, it was expressed thus: "The Court, without considering the content of Documents 1, 3, 4, 5, 6, 7, 8, 9 and 11 (which were inspected by the Tribunal but not the Court), erred in law in concluding that there could be no basis upon which, on the material before the Tribunal, an opinion could be formed under s 50(4) of the Freedom of Information Act 1982 (Vic) that the public interest requires that access to the said documents be granted under the Act."58 The ground so framed did not call into question the errors of law attributed to the Tribunal by the Court of Appeal. Whether and to what extent, having regard to the range of matters that might be considered under s 50(4), the first of them was in truth an error of law is questionable but, in any event, was not in issue. The joint judgment of Gleeson CJ, Gummow, Heydon and Kiefel JJ posed the question for decision thus59: "The question for this Court is whether, not having seen the documents, the Court of Appeal erred in deciding that, in the circumstances of the case, there was no basis upon which it could have been concluded that the case was one for the application of s 50(4)." 57 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 299 [51] per Gleeson CJ, Gummow, Heydon and Kiefel JJ. 58 The numbered documents referred to the advices received by the Attorney-General and associated departmental correspondence. 59 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 299 [52]. Bell That question was a question of law: was s 50(4) capable of application in light of the Attorney-General's press release and the contents of the disputed documents? As to the possibility, discussed by Bongiorno AJA, that disclosure of differing advices could lead to collateral political attack on the Attorney- General's decision, the majority in this Court said60: "Regardless of whether the advice given by the Attorney-General to the Governor was legally unexaminable, the conduct of the Attorney- General was not unaccountable. The very exercise in which the Attorney- General was engaged in putting out his press release assumed political accountability. Political attack on a decision not to exercise the prerogative of mercy in a particular case, or at least on the process leading to such a decision, is not alien to the process. That does not mean abrogating legal professional privilege and other statutorily recognised grounds of confidentiality. What it means, however, is that the risk of political criticism is not of itself a public interest argument against disclosure. This aspect of the reasoning of two members of the Court of Appeal was erroneous." Their Honours added that it would have been appropriate for the Court of Appeal to reject reasoning along the line that the very existence of a number of advices meant that they should all be released in order to "clear the air" and dispel speculation61. They said62: "If, however, there were some material difference in the advices, or the facts on which they were based, then, depending on the nature and extent of that difference, it is not impossible that an aspect of the public interest could require its revelation. If Morris J had said nothing about the matter, there was no particular reason why the Court of Appeal should have set out itself to look for such a problem. However, in the light of what Morris J said, the Court of Appeal should have looked at the documents. Its failure to do so was an error of principle in the exercise of a discretion. It could not be said that, as a matter of principle, no inconsistency between the various advices could possibly have required the disclosure of all or any of them." 60 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 300 [56]. 61 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 300 [57]. 62 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 300-301 [57]. Bell As indicated by that passage, differences between the advices could, depending upon their nature and extent, support, as a matter of law, the formation of an opinion, under s 50(4), that the public interest required that Mrs Osland be granted access to the documents. The majority observed that the Court of Appeal was not obliged to remit the matter to the Tribunal; it had the power to deal with the s 50(4) issue itself. It should have examined the documents, and then, having done so, it might well have concluded that the public interest did not require access to them to be granted and that either there were no material differences between the advices or such differences did not require disclosure of the documents63. Their Honours concluded64: "However, this Court cannot predict the outcome. We have not seen the documents. The matter should be remitted to the Court of Appeal to enable it to inspect the documents. Whether, following such inspection, the Court of Appeal disposes of the matter finally, or remits it to the Tribunal, will be a matter for the Court of Appeal to decide." It was not said, and it should not have been necessary to say, that the decision by the Court of Appeal whether to dispose of the matter finally or remit it to the Tribunal was to be made having regard to the nature and limits of its jurisdiction and its powers under s 148 of the VCAT Act. The orders of this Court were in the following terms: "1. Appeal allowed. Set aside the orders of the Court of Appeal of the Supreme Court of Victoria made on 17 May 2007. Remit the matter to the Court of Appeal of the Supreme Court of Victoria for further hearing in accordance with the reasons of this Court. Respondent to pay the appellant's costs of the appeal to this Court." By the orders set aside by par 2 of the orders of this Court, the Court of Appeal had allowed the appeal against the decision of the Tribunal, set aside 63 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 301 [58]. 64 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 301 [58]. Bell par 1 of the Tribunal's orders and in lieu thereof substituted an order that "[t]he decision of the respondent be affirmed"65. The effect of par 2 of the orders made by this Court was to reinstate the orders of the Tribunal setting aside the decision of the delegate and ordering that Mrs Osland be given access to the documents66. It is necessary to turn to the nature of the task which confronted the Court of Appeal on the remitter and how it approached that task. What the Court of Appeal should have done on the remitter The effect of the decision of this Court in the first appeal from the Court of Appeal was to set aside the orders of that Court. That was a final decision of this Court, not an interlocutory decision which left in place elements of the reasoning of the Court of Appeal which had not been challenged. The Court of Appeal, however, proceeded on the basis that its conclusion that the Tribunal had erred in law continued in effect. There was, it said, "no appeal from that part of the decision"67. In so reasoning, the Court appears to have misconceived the effect of this Court's decision. However, there was nothing in the grounds of appeal to this Court on this occasion to raise that error, notwithstanding it was the subject of oral submissions by counsel for Mrs Osland. Accepting that the Tribunal's decision was affected by what the Court of Appeal had said in its first decision, and effectively restated in its second decision, were errors of law, its task on the remitter was to consider how it should dispose of the appeal in the exercise of its powers under s 148(7) of the VCAT Act. That task required its application of the ruling by this Court that it was not impossible that, if there were material differences between the advices or their factual bases, an aspect of the public interest could require their disclosure. The task would have been discharged had the Court of Appeal, following an examination of the disputed documents, taken the following steps: 65 The Secretary was the respondent in the Court of Appeal. The decision affirmed had in fact been made by the Secretary's delegate. 66 The orders of this Court, as sealed, erroneously omitted par 2. However, they were not presented for sealing until after the decision of the Court of Appeal on the remitter had been handed down. The error therefore had no bearing upon that decision. 67 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 593 [12]. Bell Determine the legal question whether, in the circumstances of the case, the actual differences that existed between the advices provided to the Attorney-General could support the formation of an opinion under s 50(4) of the FOI Act that the public interest required that access be granted. If question 1 were answered in the negative, then allow the appeal and set aside the Tribunal's decision, there being no remaining basis for the exercise of the discretion under s 50(4). If question 1 were answered in the affirmative, then: set aside the decision of the Tribunal on the basis that it could have been affected by the errors of law identified in the first decision68 and remit the matter to the Tribunal for reconsideration in the light of the actual differences between the advices, as to which the Tribunal had made no findings of fact; or having regard to the protracted nature of the proceedings and the undisputed primary facts, take the course of considering for itself whether, by reason of the actual differences between the advices in the circumstances of this case, the public interest required that access be granted to the documents. In the event that access was required to be granted, it could have allowed the Tribunal's reinstated decision to stand69. An alternative to this course, to the same practical effect, would have been for the Court of Appeal to set aside the Tribunal's decision and substitute its own decision granting access. What the Court of Appeal did on the remitter The Court of Appeal in a unanimous judgment characterised its previous decision as holding that the public interest override in s 50(4) of the FOI Act "was not capable of applying in these circumstances"70 (emphasis added). That amounted to a conclusion that, save for what might emerge from an examination 68 Commonwealth v Human Rights and Equal Opportunity Commission (1998) 76 FCR 513 at 519 per Burchett J and authorities cited therein. 69 See Director-General of Social Services v Hales (1983) 47 ALR 281 at 310 per Lockhart J for an example of such an approach to an AAT decision. 70 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 593 [10]. Bell of the disputed documents, the circumstances upon which the Tribunal had previously relied could not, as a matter of law, attract the application of s 50(4). The Court treated its task on the remitter as a reconsideration of the question whether s 50(4) "could or would" apply following an inspection of the documents71. The question whether s 50(4) "could" apply reduced to the question whether, having regard to the contents of the documents, it was open to the Tribunal to form an opinion that the public interest required access to the documents to be granted. The question whether s 50(4) "would" apply depended upon whether the decision-maker actually formed the opinion that the public interest required that access should be granted. On the remitter, the Secretary abandoned reliance upon the legal error previously found by the Court of Appeal in relation to the Tribunal's disposition of the argument based upon a s 30 exemption. This removed a possible obstacle to an argument by the Secretary that the Court of Appeal should finally determine for itself whether to exercise the discretion under s 50(4). Partly in the light of the Secretary's concession, the Court rejected a submission by counsel for Mrs Osland that it should remit the s 50(4) question to the Tribunal for "We rejected that submission, for the following reasons. First, the tribunal has already exercised the s 50(4) discretion. For reasons given by this court on the last occasion, that exercise of discretion was vitiated by error. There was no appeal from that part of the decision, and we see no particular reason why the tribunal should be called on to consider the exercise of the discretion for a second time. The appellant's abandonment of the other ground of exemption originally relied on (s 30(1) of the Act) means that there is no longer any 'unfinished business' in the tribunal." The Tribunal had previously exercised its discretion on a footing different from that in issue before the Court of Appeal on the remitter. Contrary to the reasoning of the Court of Appeal, there was "unfinished business" before the Tribunal if the contents of the disputed documents were such that s 50(4) could be applied. This aspect of the reasoning of the Court of Appeal did not support the conclusion that it should not remit the matter to the Tribunal. 71 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 593 [10]. 72 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 593 [12]. Bell The Court also took the view that having completed the task of inspecting the documents, there was no difficulty in its considering and deciding the s 50(4) question. It said73: "Finally, and in any event, there must be an end of litigation. The original decision on Mrs Osland's request for access to the documents was made 7½ years ago. The remaining issue is clear and it should be decided here and now." The "remaining issue" comprised a question of law and, if that were answered favourably to Mrs Osland, the factual and evaluative question whether the public interest required a grant of access to the documents. The Secretary pointed to passages in the judgment of the Court of Appeal indicating that it had considered the nature and content of the differences between the advices. The Court had referred to "material differences of opinion between the Redlich advice and the joint advice" albeit it did so because it thought it "important … to put an end to the speculation on that aspect of the matter"74. It characterised the material differences as differences of opinion75. It identified one of the issues considered by the advices as whether Mrs Osland's circumstances exemplified what it referred to as "battered wives syndrome"76. It referred to "different shades of opinion" within and between advices77. It said78: "A reading of the advices confirms that the decision whether or not to exercise mercy – and, if so, how it should be exercised – is informed, but not governed, by legal considerations. … The ultimate decision is a matter of judgment, not of law. It involves a range of questions, on some or all of which reasonable minds may well differ". (footnote omitted) 73 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 594 [13]. 74 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 595 [18] (footnote omitted). 75 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 595 [18]. 76 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 602 [44]. 77 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 595 [18]. 78 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 603 [46]. Bell The Secretary also made the point that the Court expressly referred to the fact that the advices were obtained "sequentially, rather than simultaneously"79 and were "successive"80 in the sense that a later advice dealt with observations in an earlier advice. These matters, however, are of considerably diminished significance when the Court's reasons are considered. The Court referred to the public interest against access inherent in the exemption of the documents from disclosure by reason of legal professional privilege. It acknowledged that there might be public interest factors favouring access. In the event it identified none. Nevertheless, it said that the task confronting it involved "a balancing process"81. What was balanced against what did not emerge. It was common ground that the power to grant access under s 50(4) was exercisable "only if the tribunal (or, in this case, the court) concluded that the public interest required that access be granted"82. The Court held that nothing in the language of the press release warranted a finding that the Attorney-General had represented to the public either that the joint advice was the only advice he received on the topic or that he had received no advice to the contrary83. The announcement was intended to convey, and in fact conveyed, no more than that the decision had been based on, and accorded with, independent legal advice from eminent counsel84. Mrs Osland's alternative argument, that the Attorney-General's "assumption" of political accountability for his decision required that the documents be released in the public interest, was also rejected85. The Court referred to the nature and extent of ministerial accountability as "a large topic" involving questions of political theory and constitutional law and practice86. That topic was consigned to the category of "abstract policy 79 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 603 [46]. 80 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 603 [46]. 81 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 596 [21]. 82 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 596 [22]. 83 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 598-599 84 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 599 [31]. 85 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 599 [32]- 86 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 600 [38]. Bell considerations" which have "no place in the s 50(4) analysis"87. The Court then said88: "It is, accordingly, outside the scope of s 50(4) for this court to decide, as a matter of generality, whether there should be public scrutiny of legal advices received by a Minister in connection with the making of an executive decision. That is so whether the public interest is said to reside in greater transparency or in greater accountability. … Whether ministerial accountability entails the production of legal advices relied on by ministers in making decisions, and if so in what circumstances, is a policy question which will fall to be considered, if and when it arises, by the executive or by the legislature." (emphasis added) The conclusion so expressed was a conclusion of law. It was logically independent of the actual contents of and differences between the advices. The Court considered what it described as the critical question which arises when an exercise of discretion under s 50(4) is sought, namely, "whether the particular circumstances of the case require disclosure of the exempt document(s) in the public interest"89. Having read the advices, it was satisfied that there was nothing about the petition, or the advices, or the process of decision-making, or the announcement of the decision, which compelled disclosure of the documents in the public interest90. But the justification offered for that conclusion did not depend upon actual differences between the advices received by the Attorney-General. For, in reasoning to the conclusion, the Court held: The context of Mrs Osland's case, namely, public concern and controversy about what it referred to as "battered wives syndrome", did not create or impose on the Attorney-General any new or different obligation of accountability which s 50(4) could be invoked to enforce91. 87 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 601 [40]. 88 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 601 [41]. 89 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 602 [43]. 90 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 602 [44]. 91 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 602 [44]. Bell The sequence of advices, both external and departmental, confirmed that a proper process was followed from start to finish. There was nothing unusual in the Attorney-General obtaining multiple opinions or in the fact that there might be differences of opinion. There was no inference of impropriety or malpractice emerging from such differences92. The question on which the Attorney-General obtained successive advices was "of high importance and of considerable complexity". The ultimate decision was a matter of judgment, not of law. It involved questions on some or all of which reasonable minds might differ. The existence of differences did not compel disclosure in the public interest93. Unlike the position in Director of Public Prosecutions v Smith94, there was no public concern that the administration of the criminal justice system had been perverted95. The foregoing reasons were limited to the propriety of the process undertaken by the Attorney-General and the importance and complexity of the questions he had to decide. The proposition that the existence of differences did not compel disclosure in the public interest was, in the context in which it appeared, a general statement about the effect of the existence of differences and not based upon consideration of the actual differences. The reference to Director of Public Prosecutions v Smith was irrelevant to the content of the documents as no argument had been advanced that their contents suggested that the administration of criminal justice had been perverted. The generality of the Court's reasoning indicated it was really addressing a question of law precluded by the terms of the remitter from this Court, namely, whether the evaluation of differences (of any kind or degree) could attract the operation of the discretion under s 50(4). Grounds of appeal The grounds of appeal on which special leave was granted were: 92 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 602 [45]. 93 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 603 [46]. 95 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 603 [47]- Bell "(a) The Court of Appeal did not perform the task required of it in accordance with the High Court's remittal in that it failed to determine that, in the circumstances of the present case, s 50(4) of the Freedom of Information Act 1982 (Vic) ('the FOI Act') was enlivened as a result of those material differences [sic]. The Court of Appeal erred in concluding that, notwithstanding the content of the press release, there was nothing in the content of the legal advices provided to the Attorney-General, and nothing in the revealed differences between those advices, and their extent, that attracted the operation of s 50(4) of the FOI Act. The Court of Appeal ought to have found that the press release was misleading, lacked candour or was otherwise materially inaccurate or incomplete and, as a consequence, s 50(4) was enlivened." Conclusions and disposition In the course of the hearing of the appeal, this Court posed the following questions to the parties: (a) whether on remitter the Court of Appeal performed the task required of it, namely, to determine whether, in the circumstances found by the Tribunal, s 50(4) of the FOI Act was incapable of application; (b) whether, if the Court of Appeal did not perform that task, the respondent in this Court now asserts that error of law is nonetheless demonstrated in the decision of the Tribunal in the application of s 50(4); (c) what orders, including as to costs, should be made by this Court in the light of the answers to questions (a) and (b)? The Secretary submitted that, given her withdrawal, on the remitter, of reliance upon the Tribunal's failure to consider the s 30 exemption before applying the public interest override, there was no need for the matter to be further remitted to the Tribunal to hear evidence in support of the s 30 exemption. The "error of law jurisdiction" of the Court of Appeal remained because the errors previously identified remained. The question before the Court of Appeal on the remitter was whether, in the circumstances of the case, the public interest required the release of the documents. She submitted that it was not necessary for the Court of Appeal to determine that s 50(4) was incapable of application because on the remitter it was not identifying further error in the Tribunal's decision, having already concluded that the Tribunal's decision was Bell vitiated by error, but rather exercising the power conferred on it under s 148(7) of the VCAT Act, including the power under s 50(4). The submissions made on behalf of the Secretary as to the process followed by the Court of Appeal, in answer to the questions posed by this Court, do not meet the difficulty that the Court of Appeal did not do, on the remitter, what this Court had required it to do. Putting to one side the debate about whether it could justify its exercise of power under s 148(7) by reference to errors of law identified in its first decision, the Court of Appeal did not consider the question of law raised by s 50(4), nor did it consider the exercise of the discretion under that sub-section, by reference to the content of the disputed documents and the differences between them. Nor did it appear to give any real consideration to the limited nature of its jurisdiction under s 148. The question which then arises is how this appeal should be disposed of. This Court, in the course of the present appeal, has looked at the disputed documents and received detailed written submissions respecting the terms in which they were expressed. A consideration of the content of the disputed documents in light of the terms of the press release indicates that important elements of the differences between the advices were not based upon different views of the applicable law. The substance of the most important differences turned upon normative judgments on matters which the authors of the advices thought relevant to the exercise of the prerogative of mercy. The exercise of the prerogative of mercy in relation to a person convicted of murder engages the public interest at a high level of importance. That importance is all the greater when, as was accepted by all of the authors of the advices in this case, the legal correctness of the conviction is not in issue, nor is it able to be put in issue. A decision for or against the exercise of the prerogative in such a case involves considerations of fundamental importance to the whole community relating to the right to life and the community's treatment of those who violate that right by killing another without legal justification or excuse. In this case, the Attorney-General recognised the importance of that public interest by disclosing, in his press release, that the recommendation which he made to the Premier was based upon independent advice from persons of high standing and reputation in the legal profession and in the wider community. The press release did not, however, disclose that the joint advice was based substantially upon normative judgments about the desirability of exercising the prerogative of mercy on grounds which did not impugn the correctness of the conviction. It did not disclose that differing judgments had also been proffered. The nature of the differences between the advices, throwing up opinions about the fairness and authority of the criminal justice system, the circumstances of Mrs Osland's situation, and asserted inadequacies in the law in relation to Bell chronic domestic violence, was such as to be capable of supporting the formation of an opinion that the public interest required the disclosure of the documents. It was, at the very least, arguable, in the circumstances of the case, that the high- threshold public interest standard was met and that the public interest required disclosure of the contending, essentially normative propositions which the Attorney-General had before him when he recommended that Mrs Osland's petition be denied. The differences between the authors of the advices were on questions readily comprehensible by members of the public. They did not turn upon arcane disagreements, likely to be misunderstood, about the interpretation of the relevant law. Against the weight of such considerations, in applying s 50(4) of the FOI Act the interests protected by legal professional privilege, and recognised by s 32(1) of that Act, in the particular case were arguably of diminished importance. When the Attorney-General received the advices which he did from various members of the legal profession, he did so on behalf of the public and not as a private citizen. Such continuing public interest as there was in the privilege attaching to the documents in the circumstances of this case was capable of being put to one side against the public interest in disclosure. The preceding conclusions are sufficient to answer the question of law implicit in s 50(4) in favour of Mrs Osland. That question having been answered in the affirmative by reference to the nature and scope of the differences between the advices, the appeal should be allowed. The question then arises as to what further orders should be made. While it would be open to this Court to remit the matter again to the Court of Appeal for further hearing or to substitute for that Court's orders a remitter to the Tribunal for consideration on the merits, such remitters would generate unacceptable additional delay in a process already unduly protracted. The order made by the Tribunal is supportable as a matter of law, even though it was not expressly based upon the differences between the advices. Having regard to the basis upon which the Tribunal's decision can be supported by reference to the contents of the documents in the circumstances of this case, there is little room left for the exercise of the discretion adversely to Mrs Osland. In the circumstances, the most appropriate disposition is to set aside the orders of the Court of Appeal, thus reinstating the Tribunal's order granting access to the documents. It was submitted for the Secretary that there should be no order for costs in favour of Mrs Osland as it was common ground in the Court of Appeal that the task facing that Court was a "balancing exercise" rather than the determination of a question of law. However, the orders now proposed turn upon the failure of the Court of Appeal to undertake the task it was required to undertake. That was in issue on the grounds of appeal in this Court. While the significance of the question of law to be determined emerged in the course of argument, that does Bell not warrant a departure from the usual order as to costs in this Court. However, having regard to the course taken in the Court of Appeal, Mrs Osland should not have an order for her costs in that Court. The orders of the Court should be: The appeal be allowed with costs. The order of the Court of Appeal made on 7 April 2009 be set aside and, in lieu thereof, it be ordered that the appeal from the order of the Tribunal made on 16 August 2005 be dismissed. The following orders of this Court be vacated: par 6 of the orders made by Hayne J on 27 October 2009; par 2 of the orders made by Kiefel J on 4 February 2010; and par 6 of the orders made by Hayne J on 18 March 2010. The appellant's counsel and solicitor and senior counsel's secretaries be released from the written undertakings they provided to the respondent in relation to this appeal. The setting aside of the orders made by Hayne J and Kiefel J will have the effect that, inter alia, the disputed documents, which are contained in a confidential appeal book filed in this Court, will be available for inspection and copying pursuant to the High Court Rules 2004. HAYNE AND KIEFEL JJ. The background to this matter is referred to in the earlier decision of this Court96. It commences with the appellant's petition to the Governor of Victoria in 1999 for the grant of a pardon for the murder of her husband of which she had been convicted. The petition was lodged with the then Attorney-General for Victoria. The Attorney-General, in September 2001, made a press release in which he said that he had recommended that the Governor deny the petition and that the Governor had accepted that advice. The Attorney- General said that he had made that recommendation on the joint advice of three Queen's Counsel97. In her application under the Freedom of Information Act 1982 (Vic) ("the FOI Act"), Mrs Osland sought access to a number of documents in the possession of the Department of Justice which contained legal advice, both internal and external to the Department. They included the joint advice to which the Attorney-General had referred and an advice by another Queen's Counsel98. The matter came before the Victorian Civil and Administrative Tribunal ("the Tribunal") for review of the decision, of the delegate of the Secretary, that the documents were the subject of legal professional privilege and exempt from disclosure under s 32 of the FOI Act. The President of the Tribunal, Morris J, ordered that the documents be released to Mrs Osland99. In determining that the documents should be released, notwithstanding that privilege attached to the documents, Morris J applied s 50(4) of the FOI Act, which provides the Tribunal with a special power. It is in these terms: "On the hearing of an application for review the Tribunal shall have, in addition to any other power, the same powers as an agency or a Minister in respect of a request, including power to decide that access should be granted to an exempt document … where the Tribunal is of opinion that the public interest requires that access to the document should be granted under this Act." Section 50(4) has been referred to throughout the proceedings as the "public interest override" provision. As was observed in the joint reasons on the earlier appeal to this Court, it "is a unique provision in Australian freedom of 96 Osland v Secretary, Department of Justice (2008) 234 CLR 275; [2008] HCA 37. 97 S Crennan QC, J Rush QC and P Holdenson QC. 98 R Redlich QC. 99 Re Osland and Department of Justice (2005) 23 VAR 378. information legislation."100 Section 50(4) has the effect that it is not possible to approach an exemption such as that provided in s 32 as if it were absolute, for to do so would deny the intended operation and effect of s 50(4)101. The decision of Morris J had regard to the press release made by the the it conveyed about Attorney-General and what Attorney-General had received. The press release was in these terms: the advice which "On July 5, 1999, Mrs Osland submitted a petition for mercy to the then-Attorney General, Jan Wade. That petition set out six grounds on which the petition should be granted. Following consultation with the State Opposition, I appointed a panel of three senior counsel, Susan Crennan QC, Jack Rush QC and Paul Holdenson QC, to consider Mrs Osland's petition. This week I received a memorandum of joint advice from the panel in relation to the petition. The joint advice recommends on every ground that the petition should be denied. After carefully considering the joint advice, I have recommended to the Premier that the Governor be advised to deny the petition. The Governor has accepted this advice and denied the petition." His Honour was of the opinion that the Attorney-General named the three Queen's Counsel who had given the joint advice because he wished to demonstrate that high-level advice was taken before recommending that the petition be denied, and was seeking to rely upon the reputation of those counsel to support the reasonableness of the decision102. His Honour considered that course to be legitimate, but expressed concern that the public might be misled if told that a decision had been made on the basis of one specified advice, without reference to the fact that there was also different advice. His Honour was referring in particular to an advice which had earlier been provided by Mr Redlich QC in relation to the petition. His Honour said that where a decision-maker refers to only one advice, "an impression may be created that the decision-maker really had no choice"103. His Honour concluded that these 100 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 288 [21]. 101 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 288 [21]. 102 Re Osland and Department of Justice (2005) 23 VAR 378 at 392 [51]. 103 Re Osland and Department of Justice (2005) 23 VAR 378 at 392 [52]. considerations provided "powerful reasons" why access should be provided104. Because they were powerful, in his Honour's opinion they overrode the otherwise exempt status of the documents105. The Court of Appeal (Maxwell P, Ashley JA and Bongiorno AJA) allowed the Secretary's appeal from the decision of Morris J. It found errors, which it considered qualified as errors of law, in his Honour's reasons. His Honour had put to one side the Secretary's claim for exemption of the documents under s 30 of the FOI Act, because his Honour was of the opinion that any such exemption would be subject to the overriding public interest provisions of s 50(4). Section 30 provides for an exemption relating to internal working documents. Maxwell P considered that his Honour had failed to take into account that exemption106. The correctness of this view is not presently relevant. interest considerations underlying the relevance of public Another error identified by Maxwell P concerned the view expressed by Morris J that, although legal professional privilege attached to the documents, there might be a distinction drawn between advice which was historical, and advice with respect to action to be taken107. However, Morris J went on to say that access provided on this basis might create an undesirable precedent108 and did not proceed to a conclusion on this basis. Morris J then discussed factors relating to the public interest which might favour the release of the documents. His Honour referred to the public's desire to know the reasons for denial of the petition109. Maxwell P considered that this conflated matters which might be of interest to the public with what was in the public interest, the latter being the question raised by s 50(4)110. 104 Re Osland and Department of Justice (2005) 23 VAR 378 at 392 [53]. 105 Re Osland and Department of Justice (2005) 23 VAR 378 at 393 [54]. 106 Secretary, Department of Justice v Osland (2007) 95 ALD 380 at 399-400 [77]. 107 Re Osland and Department of Justice (2005) 23 VAR 378 at 391 [44]. 108 Re Osland and Department of Justice (2005) 23 VAR 378 at 391 [47]. 109 Re Osland and Department of Justice (2005) 23 VAR 378 at 392 [50]. 110 Secretary, Department of Justice v Osland (2007) 95 ALD 380 at 403 [91]. Morris J acknowledged that a decision of the executive might not be amenable to judicial review, but spoke of the public interest, in a democracy, in such decisions111 and in transparency of processes112. Maxwell P did not take up the question of the reviewability of the decision to refuse a petition, pointing out that the subject proceedings were not of that kind113. However, Bongiorno AJA, with whom Ashley JA agreed, considered that issue as relevant to the question whether the advices received by the Attorney-General should be placed in the public domain114. It is in this connection that Bongiorno AJA made reference to the possible difference in the legal advices provided to the Attorney-General, which Morris J had alluded to in his conclusion as to the application of s 50(4). Bongiorno AJA said that any difference between the advices provided a reason against, not for, disclosure, because their release would enable a "political collateral attack on the exercise of the prerogative of mercy"115. But as was pointed out in the joint reasons on the earlier appeal to this Court, such a political attack is not alien to that process, and the exercise in which the Attorney-General was engaged, in putting out his press release, assumed political accountability116. As was observed in the joint reasons, legal errors were identified by the Court of Appeal without inspecting the legal advices. The question concerning s 50(4), as identified in the joint reasons, was117: "whether, not having seen the documents, the Court of Appeal erred in deciding that, in the circumstances of the case, there was no basis upon which it could have been concluded that the case was one for the application of s 50(4)." 111 Re Osland and Department of Justice (2005) 23 VAR 378 at 391 [48]. 112 Re Osland and Department of Justice (2005) 23 VAR 378 at 392 [49]. 113 Secretary, Department of Justice v Osland (2007) 95 ALD 380 at 404 [97]. 114 Secretary, Department of Justice v Osland (2007) 95 ALD 380 at 411 [128]. 115 Secretary, Department of Justice v Osland (2007) 95 ALD 380 at 411 [127], 116 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 300 [56]. 117 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 299 [52]. Implicit in this statement, of the issue then before the Court, was that no member of the Court of Appeal had considered the opinion expressed by Morris J at the conclusion of his Honour's reasons. This opinion related to the possible differences between the legal advices received by the Attorney-General and the prospect that the public might be misled by the press release's reference only to the joint advice as the basis for the decision not to recommend a pardon. Had they done so, they may have been alert to the need to have regard to the advices. As was said in the joint reasons, "because of what Morris J had said about the possibility of inconsistency, the Court of Appeal should have examined the documents for itself."118 in s 50(4) so as Maxwell P had concluded that "the circumstances of the present case give rise to no public interest consideration which would be capable of satisfying the legal advices."119 test Bongiorno AJA, with whom Ashley JA agreed, had determined the issue concerning s 50(4) on the basis referred to earlier in these reasons. The joint reasons in this Court concluded: to require disclosure of the "the existence of such differences as might require disclosure, having been raised obliquely by Morris J, could not be disregarded as legally impossible. The ground upon which Bongiorno A-JA discarded the possibility as legally irrelevant was incorrect."120 The reasons of Morris J did not make clear whether his Honour's conclusion about the application of s 50(4) was based upon there being a real inconsistency between the advices. His Honour gave this only as a possibility. In the joint reasons it was said that the Court of Appeal had not been obliged to remit the matter to the Tribunal, in order to clarify the matter, but ought to have viewed the advices itself. The prospect that it might consider any difference not to be material, such as might warrant disclosure, was adverted to121. Excluding the order as to costs, the orders made by this Court on that appeal were: "1. Appeal allowed. 118 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 301 [58]. 119 Secretary, Department of Justice v Osland (2007) 95 ALD 380 at 405 [103]. 120 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 301 [57], Kirby J agreeing at 313 [99]. 121 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 301 [58]. Set aside the orders of the Court of Appeal of the Supreme Court of Victoria made on 17 May 2007. Remit the matter to the Court of Appeal of the Supreme Court of Victoria for further hearing in accordance with the reasons of this Court." The effect of the second order was that the decision of Morris J stood. The task of the Court of Appeal on remitter was to determine the Secretary's appeal from that decision, on the grounds then current, pursuant to the jurisdiction given by the Victorian Civil and Administrative Tribunal Act 1998 (Vic) ("the VCAT Act"). In doing so it was to have regard to the content of the advices and the conclusion stated by Morris J as to the differences between them as necessitating the provision of access to them in the public interest. So much was required by the reasons given by this Court on the earlier appeal and the terms of the remitter. Section 148(1) of the VCAT Act provides that there is an appeal to the Court of Appeal from an order of the Tribunal122. It is limited to questions of law. In Roy Morgan Research Centre Pty Ltd v Commissioner of State Revenue (Vict)123 it was said: "Section 148 of the VCAT Act is concerned with the invocation of judicial power to examine for legal error what has been done in an administrative tribunal. Although s 148 uses the word 'appeal', it is clear that the Supreme Court is asked to exercise original, not appellate, jurisdiction and to do so in proceedings which are in the nature of judicial review." When the matter again came before the Court of Appeal on remitter, the only ground which remained concerned the application of s 50(4). The ground which relied upon an exemption provided by s 30 was not pursued. The task of the Court of Appeal was to determine whether there was error of law in the decision of Morris J to apply s 50(4). It is true that in examining the legal advices to ascertain whether there was a material difference, or inconsistency, between them, the Court of Appeal was to engage in something of a factual inquiry, but it was limited. It was necessary to ascertain whether the factual substratum for the opinion of Morris J existed and 122 And also to the Trial Division pursuant to s 148(1)(b). 123 (2001) 207 CLR 72 at 79 [15] per Gaudron, Gummow, Hayne and Callinan JJ; [2001] HCA 49. whether, as his Honour had implied, the differences were significant. The former was a necessary condition for his Honour's application of s 50(4). The latter was necessary to a proper understanding of his Honour's reasoning to that conclusion. But consistent with the VCAT Act, the Court of Appeal could not assume the function of the Tribunal and determine for itself whether the public interest required disclosure of the advices. The Court of Appeal did look at the advices and found that "there were material differences of opinion between the Redlich advice and the joint advice, and that there were different shades of opinion within the two [internal] advices"124. Now appreciating that what Morris J spoke of were indeed differences of significance in the legal advices, the Court of Appeal should have proceeded to consider whether his Honour's reasoning, in conclusion, about the requirements of the public interest, manifested an error of law. The content of that public interest was identified by his Honour by reference to the prospect that the public might be misled, unless the advices were disclosed and the basis upon which the Attorney-General had made his recommendation thereby revealed. The task which the Court of Appeal set for itself on remitter may be seen from the first question it posed for determination following its findings that there were material differences in the advices: "Does the public interest require that access be given?" This was followed by a consideration of "The public interest in accountability". The Court concluded with an inquiry as to whether "the particular circumstances of the case require disclosure"125. By posing the question it did and undertaking the inquiries identified, the Court of Appeal did not review what the Tribunal had done, and had said in its reasons, for error of law. Rather, it impermissibly assumed the role of the Tribunal and substituted its own decision126. In its conclusion the Court of Appeal said that the existence of differences in the advices did not compel disclosure. It did not consider the view of Morris J, that the differences were such as to be apt to mislead, in the context of what the public interest required. The Court of Appeal considered only whether the terms of the Attorney-General's press release, examined in isolation, were misleading and concluded that they were not. It said that there was nothing in 124 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 595 [18] (footnote omitted). 125 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 602 [43]. 126 Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 at 40-41; [1986] HCA 40. the language of the press release which represented to the public that the joint advice was the only advice that he had received, or that he had received no advice to the contrary127. It may be accepted that the press release did not contain such express representations, but the point made by Morris J was that it was implied in what the Attorney-General had said that he had received only the joint advice and had acted consistently with it in making the recommendation that the petition be denied. It was implied that his course of action was limited to that advice. This view of what the press release conveyed was not discussed by the Court of Appeal. It was a conclusion that was plainly open to Morris J and neither the conclusion nor the reasons given for it revealed legal errors. It appears from the reasons of the Court of Appeal that counsel for Mrs Osland accepted that the Court had power to determine the question as to the application of s 50(4) for itself128. The Court of Appeal referred in that regard to s 148(7)(b) of the VCAT Act, as did the Solicitor-General for Victoria on the hearing of this appeal. Section 148(7) is concerned with the orders which might be made on an appeal to the Court of Appeal under s 148(1)(a). Paragraph (b) of s 148(7) provides that the Court may make an order that the Tribunal could have made in the proceeding. The power to make such an order, or the other orders listed in s 148(7), arises only following review of the Tribunal's decision for legal error. Section 148(7) does not operate to expand the jurisdiction given by s 148(1)(a). Although expressed in wide language, the powers given by s 148(7) are only to be exercised as a remedial consequence of dealing with an error of law129. On this appeal the Solicitor-General submitted that the Court of Appeal was able to exercise the power given by s 148(7)(b) because it had found jurisdictional errors in the reasons of Morris J in its earlier decision concerning s 50(4). The fact that some such errors had not been the subject of the earlier 127 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 598-599 128 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 593 [11]. 129 Sydney Water Corporation v Caruso (2009) 170 LGERA 298 at 304 [7] per Allsop P (referring to s 57(2) of the Land and Environment Court Act 1979 (NSW)); see also Minister for Immigration and Ethnic Affairs v Gungor (1982) 42 ALR 209 at 220-221 per Sheppard J (concerning s 44(4) of the Administrative Appeals Tribunal Act 1975 (Cth)). appeal to this Court was also mentioned by the Court of Appeal130. Such an approach incorrectly views the proceedings before the Court of Appeal, on remitter, as a continuation of the previous appeal to that Court. The reasons given by the Court of Appeal on the first appeal fell with the orders of this Court setting aside the Court of Appeal's orders. For completeness, however, it should be noted that the errors identified in the earlier reasons of the Court of Appeal, in any event, did not provide a basis for a rejection of the conclusion reached by Morris J, as not authorised by s 50(4). Any error in the approach to the exemption provided by s 30 was not relevant to an extant ground of appeal. Morris J had not given effect to his views that some documents subject to legal professional privilege might be regarded as "historical". As was observed in the joint reasons in the earlier appeal to this Court, the legal errors identified by the Court of Appeal in connection with s 50(4), which were not then in contention before this Court, did not concern the contents of the legal advices131. It was the differences contained in those advices and the potential for the public to be misled which provided the "powerful reasons", to which Morris J referred, for requiring access to the documents in the public interest. This conclusion reached by his Honour stood apart from other factors to which he had referred as possibly favouring access in the public interest. It fell to the Court of Appeal to determine whether the reasons given for that conclusion were attended by error of law. In order to apply s 50(4), it was necessary for Morris J to form the opinion that the public interest required access to the documents, given the circumstances surrounding the making of the press release. Whether access was required might depend, to a large extent, on the nature of the public interest identified by his Honour. It was recognised in the joint reasons on the earlier appeal to this Court that "there are obvious difficulties in giving the phrase 'public interest' as it appears in s 50(4) a fixed and precise content."132 Nevertheless it was said that the assumption by the Attorney-General of political accountability, by putting out the press release, might be sufficient to enliven s 50(4). There is no reason why, given the inconsistency in the advices, this should not be so and the view expressed by Morris J as to the public interest seen as one within the purview of the sub-section. 130 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 593 [12]. 131 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 299 [53]. 132 Osland v Secretary, Department of Justice (2008) 234 CLR 275 at 300 [57]. Conclusion and orders The Court of Appeal did not undertake the task required by s 148(1) of the VCAT Act and determine whether the conclusion reached by Morris J, and the reasons for it, were attended by error of law. The matter does not warrant further remitter for it to undertake that task and it is appropriate for this Court to conclude that question for itself. As the Court of Appeal itself said, there is a need to end this litigation133. In the result, no error of law is disclosed. The appeal should be allowed, the orders of the Court of Appeal set aside and in lieu it be ordered that the appeal to that Court from the decision of the Victorian Civil and Administrative Tribunal of 16 August 2005 be dismissed. Consequential orders are necessary to be made with respect to interim orders made pending this appeal and to provide for release from undertakings. They are agreed between the parties as: The following orders of this Court be vacated: paragraph 6 of the orders made by Justice Hayne on 27 October paragraph 2 of the orders made by Justice Kiefel on 4 February paragraph 6 of the orders made by Justice Hayne on 18 March The appellant's counsel and solicitor and senior counsel's secretaries be released from the written undertakings they provided to the respondent in relation to this appeal. So far as concerns costs, the appellant should have an order for her costs on this appeal, but not those with respect to the hearing before the Court of Appeal, given the submissions made concerning the approach to be taken by that Court on the appeal. 133 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 594 [13]. HEYDON J. I dissent in relation to costs. As Hayne and Kiefel JJ explain, when this matter was remitted to the Court of Appeal of the Supreme Court of Victoria by this Court, the Court of Appeal had two tasks to perform. The first task, pursuant to s 148(1) of the Victorian Civil and Administrative Tribunal Act 1998 (Vic), was to examine the decision of the Victorian Civil and Administrative Tribunal to see whether it had fallen into any error of law. The second task would only have arisen if the Tribunal had fallen into any error of law. That task, pursuant to s 148(7)(b) of the Act, was to decide for itself, if it chose to, whether the public interest required access to be given to the relevant documents pursuant to s 50(4) of the Freedom of Information Act 1982 (Vic). The Court of Appeal was not at liberty to go directly to the second task without having completed the first. The Court of Appeal did go directly to the second task without having completed the first because it assumed that the proceedings remitted to it were simply a continuation of the previous appeal to it. This error on the Court of Appeal's part appears to have arisen for two reasons. The first is that, as the Court of Appeal remarked, it was "common ground" between the parties that the only task that had to be performed was the second134. The second is that the formal orders of this Court were not taken out until 4 May 2009, after the Court of Appeal had decided the remitted proceedings on 7 April 2009. When the formal orders were in fact taken out, they omitted an order that had been pronounced in open court on 7 August 2008, namely: "Set aside the orders of the Court of Appeal of the Supreme Court of Victoria made on 17 May 2007." That deficiency indicates an understanding of the remitter which explains why the appellant shared the "common ground" to which the Court of Appeal referred, and which had led the Court of Appeal not to embark on the first task. The present appellant was also the appellant on the previous occasion when the matter was before this Court. It is the responsibility of both parties to ensure that, where an appeal is remitted to another court for further hearing, the precise orders made by the remitting court are taken out, properly sealed in the Registry, and made available to the court to which the proceedings have been remitted. But it is the primary responsibility of the successful moving party to do so, here the appellant. The absence of any orders taken out in proper form may have led the Court of Appeal into the erroneous belief that the appeal to this Court which resulted in the remitter was only an interlocutory appeal, that no final order had been made, that the Court of Appeal's orders of 17 May 2007 (which rested on findings of errors of law) remained on foot, and that the Tribunal's orders were no longer on foot. This in turn may have led the Court of 134 Secretary, Department of Justice v Osland (No 2) (2009) 254 ALR 590 at 596 [21]. Appeal into the belief that its only duty was to perform the second task and not the first. In contrast, the fact was that the Court of Appeal's orders of 17 May 2007 had been set aside, the Tribunal's orders remained on foot, and those orders could not be impugned until the Court of Appeal undertook the first of the tasks before it. This is an unusual case. The terms of orders as to costs in unusual cases must depend on the particular circumstances of each case. If the successful appellant in this Court had not adopted a particular approach in the Court of Appeal, and had ensured that the correct orders were taken out before the argument in that Court took place on 30 March 2009, she may have been successful in the Court of Appeal (as she has been here), in which case her appeal to this Court would not have been necessary. For those reasons no orders as to costs should be made in relation to the remitted proceedings in the Court of Appeal or the appeal from them to this Court. I agree with the orders, other than as to costs, proposed by Hayne and Kiefel JJ and with the reasons they give for them.

HIGH COURT OF AUSTRALIA ELECTRICITY NETWORKS CORPORATION T/AS WESTERN POWER APPELLANT AND HERRIDGE PARTIES & ORS RESPONDENTS Electricity Networks Corporation v Herridge Parties [2022] HCA 37 Date of Hearing: 6, 7 & 8 September 2022 Date of Judgment: 7 December 2022 ORDER Application for special leave to cross-appeal filed by the First Respondents with respect to grounds 2 and 3 of the proposed grounds of cross-appeal refused with costs. Application for special leave to cross-appeal filed by the Second Respondents refused with costs. Appeal dismissed. The Appellant pay the costs of the First, Second, Fourth and Fifth Respondents in this Court. On appeal from the Supreme Court of Western Australia Representation B Dharmananda SC with M J Sims and B K Lim for the appellant (instructed by DLA Piper Australia) P J Dunning QC with T C Smyth for the first respondents (instructed by Slater & Gordon Lawyers) C M Harris QC with P Mendelow for the second respondents (instructed by Hall & Wilcox) Submitting appearance for the third respondents J C Giles SC with E Bathurst for the fourth respondent (instructed by J T Gleeson SC with K I H Lindeman for the fifth respondent (instructed by Wotton + Kearney) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Electricity Networks Corporation v Herridge Parties Negligence – Duty of care – Where appellant statutory corporation ("Western Power") undertook, operated, managed and maintained electricity distribution system under interconnected statutory framework – Where distribution system delivered electricity to consumers' premises – Where pursuant to statutory powers in performing statutory functions Western Power attached electrical cable and other apparatus to point of attachment pole ("PA pole") owned by and on land of fourth respondent ("Mrs Campbell") and energised her premises – Where Western Power contracted fifth respondent ("Thiess") to undertake works in vicinity of Mrs Campbell's property – Where works included removing and replacing electrical cable attached to PA pole – Where employee of Thiess did not adequately undertake inspection of PA pole to identify signs of deterioration in accordance with industry standards – Where PA pole fell to ground causing bushfire – Whether Western Power owed to persons in vicinity of distribution system duty to take reasonable care to avoid or minimise risk of injury to those persons, and loss or damage to their property, from ignition and spread of fire in connection with delivery of electricity through distribution system. Words and phrases – "assumption of responsibility", "class of persons", "control", "duty of care", "electricity distribution system", "enter into the field", "exercise of statutory powers", "existence and content of the duty", "inconsistent or incompatible", "intervene in a field of activity", "manner of exercise of the power", "negligence", "reasonable care", "reasonable precautions", "risk of harm", "statutory authority", "statutory functions", "statutory powers". Electricity Act 1945 (WA), ss 5, 25. Electricity Corporations Act 2005 (WA), ss 3, 4, 41, 42, 43, 54, 56, 58, 59, 61, 63. Electricity Industry Act 2004 (WA), ss 3, 4, 5, 6, 7, 31, 57, 58, 103. Energy Operators (Powers) Act 1979 (WA), ss 4, 28, 43, 46, 48, 49, 54, 57, 58. Electricity Industry (Obligation to Connect) Regulations 2005 (WA), regs 2, 4, 7. Electricity Regulations 1947 (WA), regs 241, 242, 265. KIEFEL CJ, GAGELER, GORDON, EDELMAN AND STEWARD JJ. This appeal arises from claims made by a large number of plaintiffs1 for loss and damage resulting from a bushfire in Parkerville, Western Australia. The fire started on 12 January 2014 when a jarrah pole on the land of the fourth respondent ("Mrs Campbell"), to which the electrical cable and other apparatus of the appellant, Electricity Networks Corporation (which traded as Western Power) ("Western Power"), were attached, fell to the ground causing electrical arcing and igniting dry vegetation around the base of the pole. The pole is referred to as a "point of attachment pole" or "PA pole", being a pole at which an electricity distribution system is attached to the consumer mains. The PA pole that fell was installed on Mrs Campbell's property by her late husband and was in place since at least 1983. It was made of jarrah and was 5.5m tall above the ground and embedded 1.1m into the ground. At the time of the fire, it was approximately 21cm in diameter at ground level tapering to 16cm in diameter at the tip. The PA pole failed below the ground line due to fungal decay and damage by termites. Western Power operated the electricity distribution system2 called the South West interconnected system ("SWIS"), which was used to deliver electricity to Mrs Campbell's property. The link by which the distribution system delivers electricity to individual consumers is called a "service cable" when above ground. The service cable is owned by Western Power. In suburban areas, the service cable typically runs from the nearest distribution pole to the front eave of the consumer's house. In regional and subregional areas, the service cable often runs from the nearest network distribution pole (a "termination pole") across the property boundary to a privately owned PA pole. From there, electricity will run to the consumer's residence, either underground or above ground. Western Power's distribution system was attached to Mrs Campbell's property in the following way: "A service cable owned by Western Power ran from a network distribution pole, referred to as a termination pole, on the road adjacent to 1 The first to third respondents to this appeal, respectively referred to as the "Herridge Parties", the "IAG/Allianz Parties" and the "RAC Parties". The RAC Parties filed a submitting appearance in this Court. 2 Electricity suppliers, not Western Power, supply electricity to consumers through the SWIS. Mrs Campbell's Parkerville property. The termination pole and the service cable were owned and maintained by Western Power. The service cable was the main conductor for the conveyance of electricity from the termination pole to the PA pole. As the service cable approached the PA pole, it passed through a wedge clamp hooked onto an attachment hook which was bolted to the side of the PA pole about 25 cm from its top. The attachment hook bore the weight of the service cable. The cable then looped back out of the clamp and into the mains connection box. Inside the mains connection box, electricity passed from the wires of the service cable to the wires of the consumer mains. The mains connection box was located adjacent to the top of the PA pole and was supported in that position by a PVC conduit containing the consumer mains. The PVC conduit was secured to the PA pole. The attachment hook, mains connection box, consumer mains and PVC conduit were owned by Mrs Campbell. Electricity was conveyed from the mains connection box by the consumer mains cable which ran, in a PVC conduit, down the side of the PA pole into the metal switchboard enclosure, which was attached to the PA pole and owned by Mrs Campbell. Inside the switchboard enclosure was a meter panel owned by Mrs Campbell, to which was affixed three service protection devices or fuses belonging to Western Power and a meter belonging to Western Power. Also affixed to the switchboard were three submains fuses, a mains neutral link and the mains switch belonging to After passing from the consumer mains cable, through the meter where it was measured, and then Western Power's fuses, electricity passed through Mrs Campbell's main switch and Mrs Campbell's submains fuses. Electricity was then conveyed by an insulated and sheathed electrical cable owned by Mrs Campbell and known as the submains cable. The submains cable exited the switchboard enclosure through a hole in the bottom of the enclosure and continued in a PVC conduit attached to the PA pole and then underground to a distribution board near Mrs Campbell's house on the property." (footnotes omitted) The fifth respondent, Ventia Utility Services Pty Ltd (formerly known as Thiess Services Ltd) ("Thiess"), carried on a business of, among other things, constructing and maintaining electricity distribution system installations and was contracted by Western Power to construct, maintain and manage aspects of Western Power's distribution system. The relationship between Western Power and Thiess was one of principal and independent contractor. Thiess was contracted by Western Power to undertake works in the vicinity of Mrs Campbell's PA pole in July 2013 ("the July 2013 works"). Those works, part of a broader series of works, included replacing Western Power's termination pole adjacent to Mrs Campbell's property from which its service cable ran across her property boundary to the PA pole. Replacement of the termination pole required removing and replacing the service cable between the termination pole and the PA pole. The trial judge found that industry practice required steps to be taken before performing works like the July 2013 works, including inspecting and sounding (striking with a hammer, axe or solid bar) the PA pole to identify signs of deterioration, as well as digging around the base of the pole to allow detection of one or both of surface decay and termite attack in the below ground critical zone. Thiess' leading hand did not perform a sounding test on the PA pole in accordance with industry standards: he did not perform the necessary hammer test adequately and he did not adequately dig around the base of the PA pole. Four proceedings were brought in the Supreme Court of Western Australia by owners of properties3 damaged or destroyed by the Parkerville bushfire claiming damages for loss and damage as a result of the negligence of, or nuisance (collectively, caused by, Western Power, Thiess and Mrs Campbell "the defendants"). There were also a number of cross-claims and claims for contribution between the defendants. The main issue at trial was the defendants' liability, if any, for the failure and collapse of the PA pole and the subsequent fire and damage. The trial judge found Thiess and Mrs Campbell liable to the plaintiffs in negligence and nuisance, and apportioned liability between them as 70 per cent to Thiess and 30 per cent to The trial judge relevantly found that Thiess owed the plaintiffs a duty to take reasonable care to perform its work on connected assets so that the assets were, as a result of the performance of its work, in a safe and fit condition for use in the supply of electricity and to take reasonable care to ensure that any assets on which it worked otherwise remained in a safe and fit condition for use in the supply of electricity after its work had been completed. Then, having regard to s 5B of the Civil Liability Act 2002 (WA) ("the CLA"), the trial judge found that Thiess had breached that duty of care by failing to adequately train and supervise the line crew 3 Namely, the Herridge Parties, the IAG/Allianz Parties and the RAC Parties. and failing to exercise due care and skill in inspecting the PA pole in accordance with its contractual obligations to Western Power and industry standards. The trial judge relevantly found that Mrs Campbell owed the plaintiffs a duty to take reasonable care to inspect and maintain the PA pole in a safe and serviceable condition, that a reasonable person in the position of Mrs Campbell would have taken the precaution of arranging for appropriate inspections of the PA pole and that, within the meaning of s 5B of the CLA, she had breached her duty because she took no steps to procure the necessary inspections, or any inspection, of the PA pole. The trial judge then found, for the purposes of s 5C of the CLA, that each of Thiess' and Mrs Campbell's breaches of duty caused the plaintiffs' loss resulting from the fire. All claims against Western Power were dismissed. The trial judge found Western Power owed the plaintiffs a duty of care – the "pre-work inspection duty of care": that before undertaking works on the PA pole and when undertaking those works, Western Power had a duty to take reasonable care to inspect the PA pole to ascertain whether it was in a safe and fit condition for use in the supply of electricity and if, when undertaking a pre-work inspection, or when undertaking works on the PA pole, Western Power identified that the PA pole was not in a safe and fit condition for use in the supply of electricity, a duty not to use the PA pole in or in connection with the supply of electricity. The trial judge, however, rejected the contention that Western Power had breached that duty of care by failing to supervise Thiess' line crew or otherwise ensure that the line crew inspected the PA pole in accordance with industry practice and by failing to implement systems for training or instructing the line crews to conduct pre-work pole inspections in accordance with industry practice. The trial judge concluded that Western Power had taken reasonable precautions to ensure that qualified and competent personnel carried out the work, including the pre-work inspections of wooden poles, by retaining a competent, reputable and experienced contractor, namely Thiess, to carry out the work under a contract which required Thiess to engage personnel to perform the work who were competent, had all the necessary skills, training and qualifications to carry out the work in accordance with the contract, and had been inducted by Thiess and were able to perform the work without the supervision of Western Power's personnel. In sum, the trial judge found Western Power had discharged its pre-work inspection duty of care by engaging and instructing Thiess to carry out the relevant work, including the inspection of the PA pole. The trial judge was not satisfied that a reasonable person in the position of Western Power would have taken any additional steps to implement systems for training or instructing line crews to conduct pre-work pole inspections in accordance with industry practice. The trial judge rejected the plaintiffs' contention that the pre-work inspection duty of care was non-delegable. All parties, other than Western Power, appealed or cross-appealed to the Court of Appeal of the Supreme Court of Western Australia. Western Power did not appeal the trial judge's finding that it owed the plaintiffs the pre-work inspection duty of care. The reasons for decision of the Court of Appeal were detailed and addressed many issues. It is necessary to deal only with those aspects of the Court of Appeal's reasons relevant to Western Power's appeal to this Court and to the applications for special leave to cross-appeal filed in this Court by the Herridge Parties and the IAG/Allianz Parties in respect of whether the pre-work inspection duty of care was non-delegable. First, the Court of Appeal held that Western Power owed to persons in the vicinity of its electricity distribution system a duty to take reasonable care to avoid or minimise the risk of injury to those persons, and loss or damage to their property, from the ignition and spread of fire in connection with the delivery of electricity through its electricity distribution system. That duty of care was broader than the duty found by the trial judge in two ways: it was broader in its temporal scope and it was not limited to occasions when work was to be, or was being, done. The Court of Appeal held that Western Power breached that broader duty of care by failing to have a system for the periodic inspection of wooden PA poles owned by consumers and used to support live electrical apparatus forming part of Western Power's electricity distribution system. Western Power's sole ground of appeal to this Court challenged the imposition on it of that broader duty of care on the basis that the Court of Appeal erred "[i]n holding that [Western Power] owed a duty of care requiring it to have a system for inspecting wooden point of attachment poles owned by consumers". It was said that Western Power's "functions do not give rise to a relationship, especially as concerns control, which supports the asserted duty" and that "the asserted duty is inconsistent with the statutory scheme". In so doing, however, much of Western Power's argument on appeal was focused on that "system" of inspection. But, as has been seen, the Court of Appeal held that Western Power's failure to have such a system of inspection amounted to a breach of the broader duty of care. In attempting to frame the duty found by the Court of Appeal as including the requirement to have a system of inspection, Western Power's appeal sought to attack a duty which was not formulated below. Furthermore, the Court of Appeal's finding of breach was not raised by Western Power's Notice of Appeal, and Western Power did not seek leave to appeal that finding. The case therefore stands and falls on whether Western Power owed the broader duty of care. For the reasons that follow, Western Power's appeal to this Court against the imposition on it of that broader duty should be dismissed with costs. Second, the Court of Appeal upheld the finding of the trial judge that Western Power's pre-work inspection duty of care was not a non-delegable duty. If Western Power was successful in its appeal to this Court, the Herridge Parties and the IAG/Allianz Parties sought special leave to cross-appeal against that finding. Given that Western Power is unsuccessful in its appeal, and that the Herridge Parties and the IAG/Allianz Parties chose to make that application for special leave conditional, it is inappropriate to grant those parties special leave to cross-appeal in relation to non-delegability and those applications are refused with costs. It is unnecessary to address that issue further. These reasons will consider the applicable principles for determining the existence or otherwise of a common law duty of care allegedly owed by a statutory authority, before turning to consider the existence and content of the broader duty imposed on Western Power, by reference to the terms, scope and purpose of the statutory framework and, in that context, the statutory functions and powers which Western Power in fact exercised. Principles There is no freestanding common law rule which fixes whether and when a common law duty of care upon a statutory authority might, or might not, arise4. Statutory authorities take many forms and have different functions and powers. It is wrong to treat all statutory authorities alike. The starting point for analysis of any common law duty of care that might be owed by any statutory authority must always be the particular statutory framework within which the statutory authority operates5: "The existence or otherwise of a common law duty of care allegedly owed by a statutory authority turns on a close examination of the terms, 4 Pyrenees Shire Council v Day (1998) 192 CLR 330 at 343-345 [18]-[20], 376-377 [106]-[110]. See also Stovin v Wise [1996] AC 923 at 937-938, 953-955. 5 Graham Barclay Oysters Pty Ltd v Ryan (2002) 211 CLR 540 at 596-597 [146] (emphasis added). scope and purpose of the relevant statutory regime. The question is whether that regime erects or facilitates a relationship between the authority and a class of persons that, in all the circumstances, displays sufficient characteristics answering the criteria for intervention by the tort of negligence." And in formulating a common law duty, it is important to keep in mind the distinction between the existence and content of the duty (who owes the duty, whom do they owe the duty to, and what kind of risks of harm must they take reasonable care to minimise or avoid?) and questions of breach (what were the reasonable precautions required in the circumstances, and did the person discharge the duty?)6. The two propositions – that there is no freestanding common law rule which fixes whether and when a common law duty of care upon a statutory authority might, or might not, arise, and that the starting point for the analysis of any such duty is the terms, scope and purpose of the applicable statutory framework – require first that the functions of the statutory authority are identified and, second, that the statutory powers that the statutory authority in fact did exercise in performance of those functions (as well as those which it could have exercised but did not) are identified. See, eg, Crimmins v Stevedoring Industry Finance Committee (1999) 200 CLR 1 at 30-31 [65]; Graham Barclay (2002) 211 CLR 540 at 585 [106], 611 [192]; Vairy v Wyong Shire Council (2005) 223 CLR 422 at 432-435 [25]-[32], 441 [54], 443-444 [64], 447 [73], 454 [98]; Stuart v Kirkland-Veenstra (2009) 237 CLR 215 at 247 [85], citing Wyong Shire Council v Shirt (1980) 146 CLR 40 at 47-48. See also Barker et al, The Law of Torts in Australia, 5th ed (2011) at 418-419 [8.1]; Luntz et al, Luntz & Hambly's Torts: Cases, Legislation and Commentary, 9th ed Generally speaking, a statutory authority which is under no statutory obligation to exercise a power comes under no common law duty of care to do so7: "[t]he common law does not superimpose such a duty on a mere statutory power"8. But a statutory authority may, by its conduct, assume a responsibility to exercise the power9. In that case, the statutory authority may owe a common law duty which requires it to exercise a power which it is under no statutory obligation to exercise. The approach to whether a statutory authority has assumed responsibility to exercise a power, such that it can be tortiously liable for an omission to exercise that power, has sometimes been considered by reference to notions of "control"10. Sometimes control, in the sense of the ability to assert power over another person or their property, has been expressed as though it were the sole criterion of assumption of responsibility. For example, in Brodie v Singleton Shire Council, the plurality emphasised that the highway authority had, by powers vested under statute, significant and exclusive power or "control" over the highway which was the source of the risk of harm, and that road users generally were not empowered to manage or change the features of public roads11. There was little focus upon whether the authority had assumed responsibility for repair or whether the driver Sutherland Shire Council v Heyman (1985) 157 CLR 424 at 459-460. See also Gorringe v Calderdale Metropolitan Borough Council [2004] 1 WLR 1057 at 1067 [32]; [2004] 2 All ER 326 at 337-338. As the common law treats natural persons: see Hargrave v Goldman (1963) 110 CLR 40 at 66. Sutherland Shire Council (1985) 157 CLR 424 at 483. 9 Pyrenees (1998) 192 CLR 330 at 345 [20]; Gorringe [2004] 1 WLR 1057 at 1070 [43]; [2004] 2 All ER 326 at 340. See also Sutherland Shire Council (1985) 157 CLR 424 at 460. 10 See, eg, Pyrenees (1998) 192 CLR 330 at 347 [25], 376 [124], 389 [168]; Crimmins (1999) 200 CLR 1 at 24-25 [43]-[46], 42-43 [104]-[107], 61 [166], 82 [227], 104 [304]-[305], 116 [357]; Brodie v Singleton Shire Council (2001) 206 CLR 512 at 558-559 [102]; Graham Barclay (2002) 211 CLR 540 at 598-599 [150]-[152]; Stuart (2009) 237 CLR 215 at 254 [113]-[114], 262 [138]. See also Burnie Port Authority v General Jones Pty Ltd (1994) 179 CLR 520 at 551-552. (2001) 206 CLR 512 at 573-574 [139]-[140]; see also 559 [102]-[103]. had relied upon that assumption of responsibility12. The focus of the decision, reflecting the submissions made to this Court in that case, was instead upon whether public authorities enjoy a special immunity from liability in relation to highways. A majority of this Court held that they do not13. Further, in the context of omissions, control, in the sense of the ability to exercise power, like the concept of "reliance"14, should not be treated as an overarching analytical tool in determining whether a common law duty to exercise power should be imposed on a statutory authority that has assumed responsibility to act. Each authority is governed by its own statutory framework, and the subject matter to which an exercise of its statutory powers might be directed will vary. It may be that no assumption of responsibility could arise in the absence of an ability to exercise power, but this appeal does not concern liability for a mere omission to exercise statutory power and these issues need not be further considered. This appeal is concerned with the existence and content of a duty of care that is owed in the exercise of statutory powers. But although this appeal does not concern a failure by a statutory authority to exercise particular statutory powers – powers that the statutory authority had, and which it could have exercised but did not15 – that does not mean that those powers that were not exercised are irrelevant. As explained below, in determining the existence and content of a duty of care arising from the statute, the whole statutory regime must be considered, including powers which have not been exercised but are interconnected with powers which have been exercised. When a statutory authority has entered into the exercise of its statutory powers, the question is whether the relationship between the statutory authority and a class of persons affected by the manner of exercise of the power was such as 12 cf Sutherland Shire Council (1985) 157 CLR 424 at 461-463. 13 Brodie (2001) 206 CLR 512 at 570-574 [129]-[140], 589-591 [197]-[202]. 14 Pyrenees (1998) 192 CLR 330 at 343-345 [18]-[20], 376-377 [125]-[126], 385-388 [156]-[165], 411-412 [230]-[232]; cf 361 [77], 370-371 [106]-[110]. See also Stovin [1996] AC 923 at 937-938, 953-955. 15 cf Sutherland Shire Council (1985) 157 CLR 424 at 443, 460-461, 479, 501-502; Graham Barclay (2002) 211 CLR 540 at 574 [78]; Stuart (2009) 237 CLR 215 at 225 [11], 253 [108], 256 [118]. See also Crimmins (1999) 200 CLR 1 at 18 [25]. to give rise to a duty of care. The focus of the analysis is upon the relevant legislation – the powers that have been exercised in the performance of the authority's statutory functions – and the positions occupied by the parties. If such a relationship is created, then "the common law imposes a duty in tort which operates alongside the rights, duties and liabilities created by statute"16. A duty cannot arise where it would be inconsistent or incompatible with the statutory powers or duties imposed on the statutory authority or it would be incoherent with Where a statutory authority which, consistent with its express functions, in fact "ent[e]r[s] into the field"18 of exercising specific powers in the discharge of its functions19, the exercise of power is sometimes also described in terms of "control": the assumption of control20; the taking "advantage of ... control"21; or the "control exercised"22. However described, it is the identification of the statutory authority's powers that it in fact exercised that is critical because it is the manner of the exercise of those powers to which a common law duty of care may attach23. Having identified the powers that were in fact exercised by the statutory authority 16 Graham Barclay (2002) 211 CLR 540 at 597 [147] (emphasis added); cf 597-598 17 Crimmins (1999) 200 CLR 1 at 13 [3], 19 [27], 39 [93], 42 [104], 45 [112], 46 [114], 76 [213]; Sullivan v Moody (2001) 207 CLR 562 at 580 [50], 581 [55]-[56], 582 [60], [62]; Graham Barclay (2002) 211 CLR 540 at 597-598 [147], [149]; Stuart (2009) 237 CLR 215 at 254 [113]. 18 Pyrenees (1998) 192 CLR 330 at 372 [115]. See also Graham Barclay (2002) 211 CLR 540 at 576 [81]; Stuart (2009) 237 CLR 215 at 261 [135]. 19 Caledonian Collieries Ltd v Speirs (1957) 97 CLR 202 at 220; Sutherland Shire Council (1985) 157 CLR 424 at 458, 484, 501; Pyrenees (1998) 192 CLR 330 at 391-392 [177]; Stuart (2009) 237 CLR 215 at 255-256 [117]. 20 Howard v Jarvis (1958) 98 CLR 177 at 183; Stuart (2009) 237 CLR 215 at 249 [90]. 21 Burnie (1994) 179 CLR 520 at 556. 22 Stuart (2009) 237 CLR 215 at 254 [113]; see also 261 [136]. 23 See Cox Bros (Australia) Ltd v Commissioner of Waterworks (1933) 50 CLR 108 at 119; Caledonian Collieries (1957) 97 CLR 202 at 220; Pyrenees (1998) 192 CLR 330 at 391-392 [177]; Graham Barclay (2002) 211 CLR 540 at 576 [81]. in the performance of its functions, the question is: does the common law impose on the statutory authority a duty of care as to the manner of its exercise of those statutory powers (or performance of its statutory duties)24? And in answering that question, it is often helpful to ask whether the statutory authority has exercised its powers to "intervene in a field of activity" in a manner which has increased the risk of harm to persons whom it had the power to protect25. Put in different terms, a statutory authority which enters upon the exercise of statutory powers with respect to a particular subject matter may place itself in a relationship to others where a common law duty of care attaches to the manner of the exercise of those powers26. As has been observed, a statutory authority which enters upon the exercise of its statutory powers with respect to one of its functions may be subject to a common law duty to exercise those powers with reasonable care. However, the reasonable precautions that are required to discharge that common law duty in the exercise of those powers will often depend upon the nature of the powers which are to be exercised and the circumstances in which they will be exercised. Further, an absence of a continuation of the exercise, or an absence of further exercise, of those or any interconnected powers "may be difficult to separate from the 24 Sutherland Shire Council (1985) 157 CLR 424 at 458, 484; Pyrenees (1998) 192 CLR 330 at 391-392 [177]. 25 Graham Barclay (2002) 211 CLR 540 at 576 [81], citing Knightley v Johns [1982] 1 WLR 349 at 357-358; [1982] 1 All ER 851 at 857-858, Marshall v Osmond [1983] QB 1034 at 1038, Sutherland Shire Council (1985) 157 CLR 424 at 460 and Capital & Counties Plc v Hampshire County Council [1997] QB 1004 at 1031, 1042. See also Thompson v Bankstown Corporation (1953) 87 CLR 619 at 628-629, 637; Munnings v Hydro-Electric Commission (1971) 125 CLR 1 at 5, 10-11, 17-18, 28-29, 41, 49; Sutherland Shire Council (1985) 157 CLR 424 at 479. 26 See Sutherland Shire Council (1985) 157 CLR 424 at 459-460; Pyrenees (1998) 192 CLR 330 at 391-392 [177]. See also Caledonian Collieries (1957) 97 CLR 202 at 220, quoted in Sutherland Shire Council (1985) 157 CLR 424 at 436, 484, Pyrenees (1998) 192 CLR 330 at 391 [177], Crimmins (1999) 200 CLR 1 at 29 [62] and Stuart (2009) 237 CLR 215 at 256 [117]. exercise which has already occurred and that exercise [or failure to exercise] may then be said to have been performed negligently"27. The two propositions – that there is no freestanding common law rule which fixes whether and when a common law duty of care upon a statutory authority might, or might not, arise, and that the starting point for the analysis of any such duty is the terms, scope and purpose of the applicable statutory framework – are consistent with the observations of Mason J in Sutherland Shire Council v Heyman28 that when a statute sets up a "public authority" and arms it with statutory functions and appropriate powers for the attainment of certain objects in the public interest, including policy making and discretionary functions, it is preferable to express and analyse any duty that it allegedly owes in the exercise of its functions or powers by reference to those broader considerations29. The distinction between "policy making" functions and "operational" functions has been criticised30, and no rigid distinction can be drawn. But those broader considerations are considered as part of the statutory framework which informs the existence and content of the duty in those cases31. In any event, this appeal is not concerned with a public authority or public utility of the kind examined in Sutherland Shire Council. Western Power had no policy making functions. As will be seen, Western Power was a profit making enterprise obliged to undertake, operate, manage and maintain an electricity distribution system. These reasons speak of the common law imposing a duty of care on a statutory authority. That language recognises that the common law and statute 27 Pyrenees (1998) 192 CLR 330 at 392 [177], citing cf Sutherland Shire Council (1985) 157 CLR 424 at 479, Fellowes v Rother District Council [1983] 1 All ER 513 at 522 and X (Minors) v Bedfordshire County Council [1995] 2 AC 633 at 763. (1985) 157 CLR 424. 29 Sutherland Shire Council (1985) 157 CLR 424 at 457-458, 469; see also 500. cf Pyrenees (1998) 192 CLR 330 at 358-359 [67]-[68], 392-395 [179]-[184]; Crimmins (1999) 200 CLR 1 at 36-38 [84]-[90]. 30 Pyrenees (1998) 192 CLR 330 at 358-359 [67]-[68], 393-394 [180]-[182]; Romeo v Conservation Commission (NT) (1998) 192 CLR 431 at 484-485 [138]-[140]; Crimmins (1999) 200 CLR 1 at 37 [86]. 31 Stovin [1996] AC 923 at 946-947. interact and operate concurrently32. As these reasons emphasise, the starting point of any inquiry about whether or when a statutory authority owes a common law duty to take reasonable care will be the statute and, where the authority has entered the field, what statutory powers it has exercised and in what circumstances. Holding that the statutory authority in this case owed a common law duty to exercise those powers in the discharge of its functions with reasonable care is consistent with and required by the principles of negligence that apply more generally, whether to natural persons, bodies corporate or other commercial enterprises33. Here, we are concerned with a statutory authority which has exercised its statutory powers in the discharge of its statutory functions and in so doing has created relationships which give rise to a common law duty of care. It is the functions and powers of Western Power, in the context of the terms, scope and purpose of the statutory framework, that are addressed next. Statutory framework and Western Power The Electricity Networks Corporation, trading as Western Power, was established in 2006 as a statutory corporation by s 4(1)(b) of the Electricity Corporations Act 2005 (WA)34. Pursuant to an interconnected statutory framework, Western Power undertook, operated, managed and maintained the SWIS electricity distribution system, which was used to deliver electricity to consumers'35 premises, including Mrs Campbell's property. 32 See Brodie (2001) 206 CLR 512 at 532 [31]. 33 Dicey, Lectures Introductory to the Study of the Law of the Constitution (1885) 34 Electricity Corporations Act, the definition of s 4(1)(b) "Electricity Networks Corporation" in s 3(1). Section 4(1)(b) commenced by proclamation on 1 April 2006: Electricity Corporations Act, s 2(2)(a); Western Australian Government Gazette, No 53, 31 March 2006 at 1153. read with 35 The consumers were customers of the Electricity Generation and Retail Corporation (trading as Synergy), a different statutory corporation, which generated and sold electricity to customers by using Western Power's electricity distribution system. Western Power's functions Western Power's principal functions, set out in Subdiv 3 of Div 1 of Pt 3 of the Electricity Corporations Act, relevantly included36: to manage, plan, develop, expand, enhance, improve and reinforce electricity transmission and distribution systems and provide and improve electricity transmission and distribution services; to provide services that improve the efficiency of electricity supply and the management of demand on electricity transmission and distribution systems; to undertake, maintain and operate any works, system, facilities, apparatus or equipment required for any purpose mentioned in this section." Western Power was also given specific statutory functions to do anything that it determined to be conducive or incidental to the performance of those functions37 and to do anything that it was authorised to do by any other written law38. That last provision is important. It recognises that the Electricity Corporations Act is but one part of the relevant and interconnected statutory framework. It will be necessary to notice some features of that framework. Western Power's functions in the Electricity Corporations Act were subject to a number of specific statutory provisions in that Act. First, the fact that Western Power had a function given to it by the Electricity Corporations Act did not impose a duty on it to do any particular thing and, subject to that Act and any 36 Electricity Corporations Act, s 41 (emphasis added). 37 Electricity Corporations Act, s 42(e). 38 Electricity Corporations Act, s 42(f). direction given to Western Power under that Act, Western Power had a discretion as to how and when it performed the function39. Second, Western Power was required40 to perform its functions in accordance with its strategic development plan41 and its statement of corporate intent42 as existing from time to time and, significantly, in performing its relevant functions, it was also required to do so in accordance with "prudent commercial principles" and to "endeavour to make a profit, consistently with maximising its long term value"43. Third, the performance of Western Power's functions was relevantly limited to the geographical area of the SWIS electricity distribution system44, which was defined to mean45: interconnected "the generating works and associated works – transmission and distribution systems, located in the South West of the State and extending generally between Kalbarri, Albany and Kalgoorlie; and into which electricity is supplied by one or more of the electricity generation plants at Kwinana, Muja, Collie and Pinjar, as expanded or altered from time to time". In sum, Western Power was a statutory corporation, a commercial body with a profit making purpose and with no policy making functions, which was 39 Electricity Corporations Act, s 56. 40 Electricity Corporations Act, s 58. 41 Electricity Corporations Act, Pt 5, Div 1. 42 Electricity Corporations Act, Pt 5, Div 2. 43 Electricity Corporations Act, s 61(1). 44 Electricity Corporations Act, s 43(1). 45 Electricity Corporations Act, s 3(1) definition of "South West interconnected system" (emphasis added). required to act on prudent commercial principles endeavouring to make a profit from its prescribed statutory functions, including, relevantly, that of undertaking, operating, managing and maintaining the SWIS electricity distribution system as well as any works, system, facilities, apparatus or equipment required for those purposes. Licence to construct and operate and obligation to connect distribution system Although the Electricity Corporations Act identified Western Power's functions, among others, as undertaking, operating, managing and maintaining a distribution system, s 7(3) of the Electricity Industry Act 2004 (WA) provided that Western Power could not construct or operate that distribution system except under the authority of, relevantly, a distribution licence46. A distribution licence authorised the licensee – Western Power – to construct and operate one or more distribution systems, or to operate one or more existing distribution systems47. Under the Electricity Industry Act, "operating" a distribution system included maintaining the works or system and making modifications necessary or desirable for time, "distribution system" was defined in the Electricity Industry Act to mean "any apparatus, equipment, plant or buildings used, or to be used, for, or in connection with, the transportation of electricity at nominal voltages of less than 66 kV"49. "Apparatus" was not defined in the Electricity Industry Act, but was relevantly defined in two other Acts within the statutory framework to mean "any apparatus, equipment, plant, or appliance in which [energy or electricity] is capable of being, or is, or is intended to be transmitted, distributed, used, the works or system48. At the operation of relevant the 46 The licensing requirements applied to Western Power as a "person" despite the fact the in supplying electricity, was performing a function under that Electricity Corporations Act: Electricity Industry Act, s 6. 47 Electricity Industry Act, s 4(1)(c) read with s 3 definitions of "licence" (para (c)) and "distribution licence". 48 Electricity Industry Act, s 3 definition of "operate". 49 Electricity Industry Act, s 3 definition of "distribution system" (emphasis added). "[T]ransmission system" was defined in the same terms but where nominal voltages were 66 kV or higher: Electricity s 3 definition of "transmission system". Industry Act, consumed or converted, and includes any meter, fitting, or connection"50. A distribution licence was required to be designated to apply to one or more areas of the State specified in the licence51 and a distribution licence did not authorise Western Power to supply services for the purpose of the supply of electricity to a prescribed customer by a person other than, relevantly, the Electricity Generation and Retail Corporation52. to a distribution system53. Section 58(2) provided Next, Div 3 of Pt 3 of the Electricity Industry Act, headed "Connection to distribution system", included s 58(1), which provided that regulations may make provision for and in relation to the connection of premises owned or occupied by a customer that, "[w]ithout limiting subsection (1)", the regulations may "require the holder of a distribution licence ... to connect premises of a prescribed class to the holder's distribution system"54, prescribe the circumstances in which that obligation arises55 and provide that it is a condition of every distribution licence that the holder of the licence must comply with that obligation56. The Electricity Industry (Obligation to Connect) Regulations 2005 (WA), made under s 58 of the Electricity Industry Act, imposed obligations upon a 50 Energy Operators (Powers) Act 1979 (WA), s 4(1) definition of "apparatus"; Electricity Act 1945 (WA), s 5(1) definition of "apparatus". 51 Electricity Industry Act, s 5(1). 52 Electricity Corporations Act, s 54(2). At the relevant time, "services" was defined to mean the conveyance of electricity and other services provided by means of network infrastructure facilities, and ancillary services: Electricity Corporations Act, s 54(1) definition of "services" read with Electricity Industry Act, s 103 definition of "services". 53 Electricity Industry Act, s 58(1) read with s 57 definitions of "connect" and "premises". 54 Electricity Industry Act, s 58(2)(b). 55 Electricity Industry Act, s 58(2)(c). 56 Electricity Industry Act, s 58(3)(b). "distributor", defined to include a holder of a distribution licence57, to "attach"58 a premises to a distribution system and to "energise"59 a premises attached to a distribution system. "[A]ttach" was defined to mean "to do all that is needed to connect premises to a distribution system except energise the premises"60. "[E]nergise" was defined to mean "to complete a connection by establishing, at the meter through which electricity is to be supplied to a customer's premises, a voltage that is capable of being sustained under the expected load conditions"61. Before turning to the powers exercised in performance of Western Power's functions it is important to recognise that Western Power was also an "energy operator" for the purposes of the Energy Operators (Powers) Act 1979 (WA)62. By s 43(1) of that Act, Western Power took over the assets of its predecessor in title and was given a right of access to those assets "for the purposes of the performance of [Western Power's] functions". The assets were relevantly described as "any works or other things" that had "been placed upon, in, over or under any land" by Western Power's predecessor in title63. Western Power's powers in the discharge of its statutory functions The critical feature of this appeal is that Western Power stepped into the arena; it exercised specific statutory powers in performing its statutory functions of undertaking, operating, managing and maintaining the SWIS electricity distribution system as well as any works, system, facilities, apparatus or equipment 57 Electricity Industry (Obligation to Connect) Regulations, reg 2 para (a) of the definition of "distributor". Western Power was the holder of a distribution licence. 58 Electricity Industry (Obligation to Connect) Regulations, regs 4, 5. 59 Electricity Industry (Obligation to Connect) Regulations, reg 7. 60 Electricity Industry (Obligation to Connect) Regulations, reg 2 definition of "attach". 61 Electricity Industry (Obligation to Connect) Regulations, reg 2 definition of "energise". 62 Energy Operators (Powers) Act, s 4(1) para (a) of the definition of "energy operator" read with the definition of "electricity corporation". 63 Energy Operators (Powers) Act, s 43(1). required for those purposes, and had attached Mrs Campbell's premises to Western Power's distribution system and energised those premises64. So, what were the statutory powers that Western Power had in fact exercised in performing its statutory functions of undertaking, operating, managing and maintaining the SWIS electricity distribution system as well as any works, system, facilities, apparatus or equipment required for those purposes? it needed to perform the powers its functions under Under s 59(2) of the Electricity Corporations Act, Western Power was the given all Electricity Corporations Act – including, relevant to this appeal, s 41 of the Electricity Corporations Act65 – or any other written law. And for the purpose of performing any function, Western Power was also given specific power, among other things, to acquire, hold, manage, improve, develop and dispose of any real or personal property66; to enter into any contract or arrangement67; to appoint agents or engage persons under contracts for services to provide professional, technical or other assistance to it68; and to carry out any investigation, survey, exploration or boring69. These specific powers did not limit the general powers of Western Power under s 59(2) or the other powers of Western Power under the Electricity Corporations Act or any other written law70. Finally, it had specific power under s 49(d) of the Energy Operators (Powers) Act relevantly to "cause any distribution works or service apparatus or related things to be supported by affixing or annexing them to or against any part of a house, building or other structure". In sum, Western Power connected Mrs Campbell's premises to its distribution system by affixing elements of its system (namely, its service cable, fuses and meter) to the PA pole, and energised her premises. In order to perform 64 See [4] and [43] above. 65 See [35] above. 66 Electricity Corporations Act, s 59(3)(a). 67 Electricity Corporations Act, s 59(3)(b). 68 Electricity Corporations Act, s 59(3)(f). 69 Electricity Corporations Act, s 59(3)(h). 70 Electricity Corporations Act, s 59(5). those acts, Western Power exercised statutory powers pursuant to its functions to undertake, operate, manage and maintain its distribution system71, which was essential for the broader purpose of Western Power providing electricity distribution services72. Western Power affixed its apparatus to the PA pole at various points, and continued to use those apparatus, pursuant to broad powers to perform its functions73 and specific powers to cause its distribution system to be supported by affixing it to or against any structure74 and its duty to connect and energise premises with power75. Put in different terms, Western Power exercised its powers in the performance of its functions. It had to enter into the field76 or step into the arena – it had the responsibility to undertake, operate, manage and maintain the SWIS electricity distribution system, and it did. But that is not all. The statutory framework expressly recognised that Western Power required access to land or premises to perform its functions of undertaking, operating, managing and maintaining the SWIS electricity distribution system. Western Power was therefore given the power to enter and re-enter land or premises on which any works, apparatus or system (including any meter, fitting or connection) used by Western Power for the purpose of distributing energy to a consumer were lawfully situated77. Significantly, in this context, s 46(9) of the Energy Operators (Powers) Act provided Western Power with a broad right of access for the purposes of performing its functions: "The owner or occupier of any land, premises or thing supplied with energy by an energy operator or in, on or over which any works of the energy operator are lawfully situate shall be deemed to have given consent to the energy operator to enter and re-enter thereon or therein at all reasonable times for the purposes of the performance of its functions in relation to any 71 Electricity Corporations Act, s 41(a), (i). 72 Electricity Corporations Act, s 41(a). 73 Electricity Corporations Act, s 59(2). 74 Energy Operators (Powers) Act, s 49(d). 75 Electricity Industry Act, s 58(1); Electricity Industry (Obligation to Connect) Regulations, regs 4-8. 76 Pyrenees (1998) 192 CLR 330 at 372 [115]. 77 See Energy Operators (Powers) Act, ss 28(3)(c), 46, 49(c)-(d), 57. such supply or works and no notice under this Act is required unless an agreement in writing entered into by that owner or occupier with the energy operator in relation thereto otherwise provides." (emphasis added) "[W]orks" was defined to include "any works, excavation, construction, or thing used or intended to be used for the purposes of a supply system or undertaking"78. A "supply system"79 included "distribution works", which were relevantly defined to mean "any works, apparatus or system, utilised or capable of being or intended to be utilised for the purpose of ... distributing energy to consumers and includes any other equipment or plant used in conjunction therewith, and any part thereof"80. And as we have seen, "apparatus" was defined in the Energy Operators (Powers) Act broadly to mean "any apparatus, equipment, plant, or appliance in which energy is capable of being, or is, or is intended to be transmitted, distributed, used, consumed or converted, and includes any meter, fitting, or connection"81. In direct terms, Western Power exercised its powers in performing its statutory functions of undertaking, operating, managing and maintaining the SWIS electricity distribution system and any works, system, facilities, apparatus or equipment required for those purposes. In the exercise of those powers, Western Power's service cable, fuses and meter were on Mrs Campbell's land and, in particular, attached to her PA pole and those apparatus remained there as Western Power exercised its powers in performing its statutory functions of undertaking, operating, managing and maintaining the SWIS electricity distribution system. Western Power exercised those powers continuously. Western Power's exercise of those powers therefore created a relationship between it and all other persons within the vicinity of its electricity distribution system. And a critical feature of that relationship was that Western Power exercised those powers in a manner which created or increased the risk of harm to those persons – persons it had the power to protect. The PA pole only posed the risk that it did because Western Power had attached its live electrical apparatus to it. Identification of the precise point at which Western Power's transportation of 78 Energy Operators (Powers) Act, s 4(1) definition of "works" (emphasis added). 79 Energy Operators (Powers) Act, s 4(1) definition of "supply system". 80 Energy Operators (Powers) Act, s 4(1) definition of "distribution works". 81 Energy Operators (Powers) Act 1979, s 4(1) definition of "apparatus". electricity using its distribution system was made to, or received by, the consumer82, Mrs Campbell, was and is not determinative or necessary. Western Power had a duty to take reasonable care in the exercise of its powers, and the content of that duty relevantly required it to avoid or minimise the risk of injury to those persons, and loss or damage to their property, from the ignition and spread of fire in connection with the delivery of electricity through its electricity distribution system – an electricity distribution system which it undertook, operated, managed and maintained in the discharge of its functions and powers by placing its apparatus on Mrs Campbell's land. The common law imposed that duty in tort on Western Power which operated alongside the rights, duties and liabilities created by statute83. the rise risk of harm Western Power's contentions did not grapple with the fact that it had stepped into the arena and exercised specific statutory powers in performing its statutory functions; or that, even though the PA pole was owned by Mrs Campbell, it was Western Power's activities arising from the exercise of those functions and powers that gave the pole collapsed. Thus, although Western Power appeared to accept that it had a duty to exercise reasonable care to minimise the risk of fire arising from its distribution system, it then sought to limit that duty to harm arising only from its own property over which it exercised physical control. It sought to further obscure the analysis by framing the relevant risk as the risk of harm "posed by the PA pole" or "the PA pole's potential failure". Western Power's focus then on whether it had a common law duty to exercise a statutory power to inspect, maintain or warn consumers about consumer-owned poles was also necessarily misplaced. Western Power's contentions focused incorrectly on the question of control or ownership of the PA pole, rather than Western Power's activities arising from the exercise of its statutory powers in the discharge of its statutory functions that gave rise to the risk of harm. Western Power's functions and powers were not constrained according to whether its activities would involve works on the land or on things annexed to the land. It had deemed consent from the owner or occupier in relation to both84. Indeed, although the submissions on this appeal proceeded on the assumption that the PA pole was a chattel owned by Mrs Campbell separately 82 See, eg, Electricity Act, s 25(1)(b), addressed at [56] below. 83 Graham Barclay (2002) 211 CLR 540 at 597 [147]. 84 Energy Operators (Powers) Act, s 46(9). from her ownership of the land, there might be serious questions about the correctness of that assumption85. Next, contrary to Western Power's contentions, the broader duty was not inconsistent or incompatible with the statutory functions and powers imposed on it86. It is not necessary to that finding of duty to point to the numerous other powers which Western Power could have exercised, but did not, to take reasonable precautions to prevent the risk of harm from the ignition and spread of fire in connection with its electricity distribution system. Those powers went to questions of breach which were not in issue in this appeal87. It is, however, important to consider the other powers in asking whether that duty of care was incoherent with the broader statutory framework88. It was not. So, for example, in addition to the statutory functions and powers which were exercised by Western Power and to which reference has already been made89, the duty is not inconsistent or incompatible with s 25 of the Electricity Act 1945 (WA), headed "Duties as to supply of electricity", which imposed two duties on Western Power as a network operator. First, a strict or absolute duty90 to maintain certain apparatus in a safe and fit condition for supplying electricity which applied to service apparatus91 belonging to Western Power which was on 85 See Australian Provincial Assurance Co Ltd v Coroneo (1938) 38 SR (NSW) 700 at 712-713; Geita Sebea v Territory of Papua (1941) 67 CLR 544 at 553-554; N H Dunn Pty Ltd v L M Ericsson Pty Ltd (1979) 2 BPR 9241 at 9243-9244, 9246. cf Anthony v The Commonwealth (1973) 47 ALJR 83 at 89. 86 See fn 17 above. 87 See [16] above. 88 Crimmins (1999) 200 CLR 1 at 13 [3], 19 [27], 39 [93(6)], 42 [104], 45 [112], 76 [213]; Sullivan (2001) 207 CLR 562 at 580 [50], 581 [55]-[56], 582 [60], [62]; Graham Barclay (2002) 211 CLR 540 at 597-598 [147], [149]; Stuart (2009) 237 CLR 215 at 254 [113]. 89 See [45]-[50] above. 90 Electricity Act, s 25(1)(a). 91 Electricity Act, s 5(1) definition of "service apparatus" read with the definition of "apparatus", would read: any apparatus, equipment, plant, or appliance in which the premises92 of any consumer; and, second, a duty93 to take all reasonable precautions to avoid the risk of fire or other damage on a consumer's premises "in the actual supply of electricity to the premises of a consumer ... to the position on the said premises where the electricity passes beyond the service apparatus" of Western Power. Nor is the duty incompatible with reg 242 of the Electricity Regulations 1947 (WA), which imposed a constraint on Western Power, as a network operator94, not to supply electricity to any premises unless, among other things, it had ensured that all of its service apparatus that would be used for supplying electricity to the premises was installed and maintained in accordance with the Electricity Act and was safe to use95 and that the connection of the supply of electricity to the premises did not cause, or was unlikely to cause, any consumers' electric installations to become unsafe96. Another example of the duty not being inconsistent or incompatible with the Western Power's statutory powers Electricity Industry Act, under which Western Power had the power to interrupt, suspend or restrict the supply of electricity (which included transport through a in s 31(1) of to be found electricity is capable of being, or is, or is intended to be transmitted, distributed, used, consumed or converted and includes any meter, fitting, or connection; or any works, apparatus or system which is or is capable of being or is intended to be used for the purpose of conveying, measuring, or controlling electricity supplied from any distribution works to the position on any premises at which delivery of the electricity is, is capable of being, or is intended to be, made to the consumer, and includes any part of the service apparatus, and any other equipment or plant used in conjunction therewith, whether or not the property of a supply authority or Western Power. 92 Electricity Act, s 5(1) definition of "premises": "any land, street, structure, or other place, and may include a vehicle or other thing in or in connection with which electricity is or is to be supplied". 93 Electricity Act, s 25(1)(b) (emphasis added). 94 Electricity Regulations 1947, reg 241(1) definition of "network operator" included any person lawfully operating distribution works and service apparatus. 95 Electricity Regulations 1947, reg 242(1)(a). 96 Electricity Regulations 1947, reg 242(1)(b). distribution system97) if, in its opinion, it was necessary to do so because of, among other things, potential danger. In doing so, Western Power was required to take reasonable steps to minimise the extent or duration of any interruption, suspension or restriction98. That power was in addition to, and did not limit, the powers Western Power, as licensee, had under the Electricity Act or the Electricity Corporations Act in relation to the interruption, suspension or restriction of the supply of electricity99 or ss 48 and 57 of the Energy Operators (Powers) Act100, which relevantly provided certain powers in the event of emergencies. Where s 31 of the Electricity Industry Act did not apply to the activity the Electricity that was Corporations Act gave Western Power that power without an obligation to take reasonable steps to minimise interruption. That power was also in addition to, and did not limit101, ss 48 and 57 of the Energy Operators (Powers) Act (which have just been addressed), or s 58 of that Act, which provided that, subject to certain stated circumstances, Western Power as an energy operator was not bound to supply energy to any person, body or authority, including if in its opinion that supply would interfere with or adversely affect any supply system or would appear to be unsafe or dangerous to life or property102. interrupted, suspended or restricted, s 63 of On the question of coherence of the duty of care with the statutory framework, Western Power had ample power to discharge its duty of care. Some of 97 Electricity Industry Act, s 3 definition of "supply". 98 Electricity Industry Act, s 31(3). Western Power was not liable for any loss or damage that arose from such an interruption, suspension or restriction, subject to specific identified exceptions including to the extent that the interruption, suspension or restriction resulted, among other things, from a negligent act or omission of Western Power or an officer or employee of Western Power: Electricity Industry Act, s 31(2). 99 Electricity Industry Act, s 31(4)(a). 100 Electricity Industry Act, s 31(4)(b). 101 Electricity Corporations Act, s 63(4). 102 Energy Operators (Powers) Act, s 58(2)(c). those powers have been addressed103. Examples of other powers included: the power to enter land or premises and improve works and maintain undertakings and facilities if requisite, advantageous or convenient to the exercise of Western Power's functions104; the power to enter any land, premises or things not under Western Power's control or management without consent where notice has been given105; the power to enter land, premises or things, relevantly, to maintain any supply system, undertaking or things106; the power to do all things necessary, relevantly, for maintaining or repairing any supply system, undertaking or related works107; the power to enter land without notice to clear or remove vegetation if Western Power was of the opinion that an occupier of land had not complied with their duty to do so108; and the power, relevantly, to require a consumer to make adjustments to the manner of operating electrical equipment if in Western Power's opinion the consumer's operation of that equipment would interfere with supply to other consumers109. Conclusion and orders For those reasons, the applications for special leave to cross-appeal filed by the Herridge Parties and the IAG/Allianz Parties, seeking to contend that the pre-work inspection duty of care was a non-delegable duty, are refused with costs. The appeal is dismissed with costs. 103 See, eg, Electricity Corporations Act, s 59(2)-(3), (5) (see [47] above), s 63 (see [58] above); Electricity Industry Act, s 31(1), (4) (see [58] above); Energy Operators (Powers) Act, s 43(1) (see [44] above), s 46(9) (see [49] above), s 58(2)(c) (see fn 102 above). 104 Energy Operators (Powers) Act, s 28(3)(c). 105 Energy Operators (Powers) Act, s 46(2). 106 Energy Operators (Powers) Act, s 49(c). 107 Energy Operators (Powers) Act, s 49(f). 108 Energy Operators (Powers) Act, s 54(2). 109 Electricity Regulations, reg 265.

HIGH COURT OF AUSTRALIA THE QUEEN AND APPELLANT ROMANO FALZON RESPONDENT The Queen v Falzon [2018] HCA 29 Date of Order: 19 April 2018 Date of Publication of Reasons: 8 August 2018 ORDER The appeal be allowed. The order of the Court of Appeal made on 5 April 2017 allowing the respondent's appeal to that Court be set aside and in place of that order the appeal to that Court be dismissed. On appeal from the Supreme Court of Victoria Representation C B Boyce SC with J B B Lewis for the appellant (instructed by Solicitor for Public Prosecutions) T Kassimatis QC with C T Carr for the respondent (instructed by James Dowsley & Associates) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS The Queen v Falzon Criminal law – Appeal against conviction – Where cannabis and drug paraphernalia found at four properties including respondent's home – Where $120,800 in cash found at respondent's home – Where respondent charged with cultivation and trafficking of cannabis found at three properties not including his home – Where Crown alleged offences of trafficking constituted of possession of cannabis on particular date for purpose of sale – Where evidence of cash led as evidence respondent engaged in business of cultivating cannabis for sale – Whether evidence of cash wrongly admitted at trial. Words and phrases – "accoutrements of drug trafficking", "business of trafficking", "cash", "drug trafficking", "indicia of trafficking", "intermediate appellate court", "possession", "profit making enterprise", "propensity", "purpose of sale", "tendency". Drugs, Poisons and Controlled Substances Act 1981 (Vic), ss 4, 5, 70(1), 71AC, Evidence Act 2008 (Vic), ss 55, 56, 136, 137. Jury Directions Act 2015 (Vic), ss 12, 15, 16. KIEFEL CJ, BELL, KEANE, NETTLE AND GORDON JJ. Where an accused is found in possession of a prohibited drug and is charged with its possession with intent to sell, proof that the accused was, at the time of possession, engaged in a business of selling drugs or drug trafficking is evidence logically probative of the fact that the accused's purpose in possessing the drug on that occasion was the purpose of sale. Accordingly, as has been established by a succession of Australian intermediate appellate court decisions1, evidence that an accused who is found in possession of a prohibited drug is also found in possession of the accoutrements of a drug trafficking business, such as scales, re-sealable plastic bags, firearms, a multiplicity of mobile telephones or significant quantities of cash, is admissible in proof of the charge. As Gleeson CJ explained in Sultana2, it is circumstantial evidence which, in conjunction with the fact of possession and, possibly, other evidence, may found an inference that the accused was engaged in the business of selling drugs. And that is so notwithstanding that such evidence may also be indicative of a tendency towards crime. In this matter, the Crown was granted special leave to appeal from the decision of the Court of Appeal of the Supreme Court of Victoria (Priest and Beach JJA, Whelan JA dissenting)3 which set aside the respondent's convictions of cultivating a narcotic plant, namely, Cannabis L, in not less than a commercial quantity, and trafficking in a drug of dependence, namely, Cannabis L. In allowing the respondent's appeal against his convictions, Priest and Beach JJA substantially departed from previous authority relevant to the admissibility of evidence of a significant quantity of cash in the respondent's possession. 1 See for example Sultana (1994) 74 A Crim R 27 at 28-29 per Gleeson CJ (Handley JA agreeing at 32), 36-37 per Sully J; Blackwell (1996) 87 A Crim R 289 at 290 per Duggan J (Prior J and Debelle J agreeing at 294); R v Edwards [1998] 2 VR 354 at 367-370 per Eames AJA (Hayne JA and Batt JA agreeing at 356); Evans v The Queen [1999] WASCA 252 at [31], [38] per Malcolm CJ (White J agreeing at [66]), [65] per Anderson J; Radi v The Queen [2010] NSWCCA 265 at [39] per Hoeben J (Simpson J and R A Hulme J agreeing at [1], [58]); Tasmania v Roland (2015) 252 A Crim R 399 at 401-402 [4]; cf Lewis (1989) 46 A Crim R 365. See also R v McGhee (1993) 61 SASR 208 at 210-211; R v O'Driscoll (2003) 57 NSWLR 416 at 432 [77] per Spigelman CJ (Carruthers AJ agreeing at 443 [149]). (1994) 74 A Crim R 27 at 28-29. 3 Falzon v The Queen [2017] VSCA 74. Bell Nettle Gordon At the conclusion of oral argument before this Court we announced that the Court was unanimously of the view that, for reasons to be published, the appeal should be allowed and that the order of the Court of Appeal allowing the appeal should be set aside, and, in its place, it be ordered that the respondent's appeal to the Court of Appeal be dismissed. These are our reasons for so ordering. Relevant statutory provisions Section 72A of the Drugs, Poisons and Controlled Substances Act 1981 (Vic) ("the Drugs Act") provides in substance, and so far as is relevant, that a person who without proper authority cultivates a narcotic plant in a quantity not less than the commercial quantity applicable to that narcotic plant is guilty of an indictable offence punishable by a maximum penalty of 25 years' imprisonment. "Cultivate" is defined in s 70(1) of the Drugs Act as including to plant, grow, tend, nurture or harvest a narcotic plant. "Narcotic plant" is defined to include Cannabis L4, and a commercial quantity of Cannabis L is 25 kilograms or 100 plants. Section 71AC of the Drugs Act provides5 in substance, and so far as is relevant, that a person who without proper authority trafficks in a drug of dependence is guilty of an indictable offence punishable by a maximum penalty of 15 years' imprisonment. Section 70(1) of the Drugs Act provides in substance, and so far as is relevant, that "traffick" in relation to a drug of dependence includes have in possession for sale. "Drug of dependence" is defined to include the fresh or dried parts of the Cannabis L plant6. Section 5 provides that a substance shall be deemed to be in the possession of a person so long as it is upon any land or premises occupied by him or her or is used, enjoyed or controlled by him or her in any place whatsoever, unless the person satisfies the court to the contrary. 4 Section 70(1) together with Col 1 of Pt 2 of Sched 11. 5 While s 71AC has been amended since the events that formed the basis of the respondent's convictions, the substance of s 71AC is preserved in the current s 71AC(1). 6 Section 4(1) together with Col 1 of Pt 2 of Sched 11. Bell Nettle Gordon The Crown case at trial On 17 December 2013 police executed search warrants at properties: 10A and 10B Mansfield Avenue, Sunshine North, Victoria; 8 Bryson Court, Sydenham, Victoria; and 5 Kendall Street, Essendon, Victoria. The search of the dwelling at 10A Mansfield Avenue, Sunshine North revealed 37 cannabis plants of varying maturity and size growing in four rooms, weighing a total of approximately 17.72 kilograms; an electricity bypass in the roof space; 15 shrouds, 28 globes, 12 electrical transformers, one carbon filter, three power boards, two shrouds with globes in boxes, six shrouds containing built-in electrical transformers, and one box containing a grow tent; and a wall chart timetable and copies of a feed programme relating to the cultivation of cannabis. The search of the dwelling at 10B Mansfield Avenue, Sunshine North revealed 55 cannabis plants of varying maturity and size, growing in three rooms, with a combined weight of 17.039 kilograms; an electricity bypass in the roof space; a number of shrouds, globes, transformers, electrical timers, a carbon filter and wall charts relating to the growing of cannabis; assorted vacuum-sealed bags, a set of scales and a sealer device; a tray containing dried cannabis weighing 28.5 grams; and a vacuum-sealed bag containing dried cannabis weighing 21.1 grams. In total, 92 cannabis plants were located at the Sunshine North properties with a combined weight of 34.781 kilograms. There was also an additional 49.6 grams of dried cannabis. The two properties at Sunshine North were jointly owned by one of the respondent's associates and the associate's wife. Police surveillance from July 2013 disclosed the respondent's occasional attendance at those properties. The search of the dwelling at Sydenham revealed 10 immature cannabis plants weighing 1.76 kilograms; eight harvested cannabis plant stumps weighing 657.9 grams; an electricity bypass; a number of light shrouds, light globes, electrical transformers, power boards and charcoal filters, together with feed programme charts setting out the timetable for nutrients to be fed to cannabis plants; two plastic bags containing a mixture of dried cannabis and unidentified plant material weighing a total of 4.1 grams; and a zip lock bag containing dried cannabis weighing 3.3 grams. Bell Nettle Gordon The property at Sydenham had been purchased by the respondent jointly with another person in early 2013 and the respondent admitted that the respondent and the other joint owner cultivated cannabis there. The search of the respondent's home at Essendon revealed, amongst other things, a plastic container of dried cannabis that weighed 220 grams; three snap- lock bags and a sealed bag (either heat-sealed or vacuum-sealed) containing dried cannabis and unidentified plant material, one snap-lock bag weighing 113.8 grams and the other two snap-lock bags with the sealed bag weighing a total of 172.3 grams, located inside a locked cabinet in the garage (the sealed bag containing dried cannabis could be connected to the presence of a sealing machine at 10B Mansfield Avenue, Sunshine North, there being no sealing machine found at either Sydenham or Essendon); a number of sets of keys that were identical to the ones used to open doors of the dwellings at 10A and 10B Mansfield Avenue, Sunshine North; hard copy documents relating to cannabis cultivation the same as hard copy and electronic documentation found at the premises at Sunshine North; two black garbage bags containing black water pipe tubing of the same type as was in use at the properties at Sunshine North; and $120,800 in cash secreted in various locations throughout the house including the storage area under the stairs inside the house (in a black plastic bag), the upstairs en-suite bathroom (in a "shortbread" tin inside a side bottom drawer), and the work bench in the garage (in a top drawer). Evidence as to the value of the cannabis grown at Sydenham was that it was between $16,000 and $32,000 for the cannabis already harvested, and between $20,000 and $40,000 for the growing cannabis plants. Evidence as to the value of the cannabis located and seized at Essendon in the plastic container, the snap-lock bags and the heat-sealed or vacuum-sealed bag was that it was between $4,500 and $8,100, although a much higher value was suggested if the assumption were made that the cannabis was to be sold in "gram quantities". The respondent was arrested on 17 December 2013 and, during the course of interview, made a number of admissions. He said that he smoked cannabis and claimed that the cannabis found at Essendon was his own and was for his personal use. When asked where he had obtained the cannabis, he said that he had grown it. When asked where he had grown the cannabis, he answered: "you know where". He admitted that he was a joint owner of the Sydenham property and had purchased it about a year before, and he said that he had grown 19 cannabis plants there of which nine had been harvested. When asked what his purpose was for the plants found at Sydenham, he answered: "personal use". He Bell Nettle Gordon said that there had been a harvest at that property some two weeks before 17 December 2013, and, when asked what had become of that material, he said: "smoke most of it, youse got the rest". He admitted that he visited Sydenham and tended the cannabis plants there, and that he had been cultivating cannabis plants there for about six months. When asked what he did with the cannabis that he did not smoke himself, he said: "give it to me mates and that. Mates come around, with the car club". The trial judge's ruling regarding the evidence of the cash Prior to the empanelment of the jury, the respondent objected to admission of the evidence of the $120,800 in cash found at Essendon, on the basis that it was irrelevant or alternatively that its prejudicial effect outweighed its probative value. The trial judge ruled that the evidence was admissible "in the same way as the finding of other indicia of trafficking is admissible", as part of the Crown's circumstantial case, and that the probative value of the evidence was not outweighed by its prejudicial effect: "Such evidence is capable, in my opinion, of having probative value when looked at alongside other evidence, including that of the organised and systematic cultivation of significant quantities of cannabis and the indicia of trafficking that I have previously referred to. I do not consider that the probative value of such evidence is outweighed by the danger of unfair prejudice to [the respondent]." The course of the trial The respondent was indicted on four charges: (1) at Sunshine North, trafficking in a drug of dependence, namely, Cannabis L, in a quantity that was not less than the commercial quantity applicable to that drug contrary to s 71AA of the Drugs Act (Charge 1); (2) alternatively to Charge 1, at Sunshine North, cultivating a drug of dependence, namely, Cannabis L, in a quantity not less than the commercial quantity applicable to that narcotic plant contrary to s 72A of the Drugs Act (Charge 2); (3) at Sydenham, trafficking in a drug of dependence, namely, Cannabis L, contrary to s 71AC of the Drugs Act (Charge 3); (4) alternatively to Charge 3, at Sydenham, cultivating a drug of dependence, namely, Cannabis L, contrary to s 72B of the Drugs Act (Charge 4). The respondent pleaded guilty to Charge 4 but not guilty to the other charges. The Crown alleged that the offences of trafficking at each of the properties at Sunshine North (Charge 1) and Sydenham (Charge 3) were constituted of possession of cannabis on 17 December 2013 at each location for the purpose of Bell Nettle Gordon sale. In relation to proof of intent in respect of both locations, the Crown relied on the number and quantity of the plants found and their value, as well as the scale and extent of the cultivation operations. Additionally, the Crown emphasised documentation to cannabis cultivation and other paraphernalia found at the Sunshine North properties. relating Evidence of the cannabis and other materials found at Essendon was led in proof of each trafficking charge, as evidence of the "indicia of trafficking" and as showing that the respondent was conducting "a professional enterprise, a business enterprise, a profit making enterprise", or "an ongoing commercial profit making enterprise", "in relation to both the cultivating of cannabis, not for personal use but for the purposes of sale, for making a profit", and that that was indicative of the fact that the respondent's purpose in possessing the cannabis found at the Sunshine North and Sydenham properties was the purpose of sale. The Crown drew attention to the sheer amount of cash found at Essendon and adduced expert evidence that drug transactions are often conducted in cash so that purchasers and sellers do not leave a trail of evidence behind them. The prosecutor also tendered tax records as establishing that the respondent had not declared the cash as assessable income, and that that was because the money represented income from dealing in drugs. The Crown also relied on the quantities of the cannabis found at Essendon and argued that it had been packaged in a fashion that was common for cannabis packaged for sale, and, in addition, drew attention to the plastic snap-lock bags and the heat-sealed or vacuum-sealed bag found at Essendon and the similar bags found at the 10B Mansfield Avenue, Sunshine North and Sydenham properties. The respondent was acquitted of Charge 1 and convicted of Charges 2 and 3 and was sentenced therefor to a total effective sentence of three years and nine months' imprisonment with a non-parole period of two and a half years. The appeal to the Court of Appeal The respondent appealed against conviction to the Court of Appeal, on two grounds. Relevantly, ground two was as follows: Bell Nettle Gordon "A substantial miscarriage of justice occurred as a result of the learned trial Judge wrongly admitting evidence that $128,000[7] cash was found secreted at the [respondent's] home." The majority, Priest and Beach JJA, allowed the appeal on that ground. Their Honours held that, insofar as the evidence of the possession of the cash was admitted on the basis that it was evidence of past trafficking, it was irrelevant because8: "the cultivation and trafficking of which the [respondent] was convicted related to Sunshine North and Sydenham respectively on one day. And … with respect to the trafficking, the prosecution eschewed reliance on a Giretti[9] charge, or on a case that involved an allegation of an ongoing drug trafficking business. Thus, as a matter of logic, it is impossible to say that the evidence of cash at the [respondent's] home – from which it was not said that he conducted any ongoing illicit business – could have gone in proof of his having possession of cannabis for sale at Sunshine North (charge 1, of which he was acquitted) or Sydenham (charge 3, of which he was convicted) on a single day in December 2013." The majority also observed that10: "the prosecutor closed, at length, on the basis that the cash demonstrated that the [respondent] had engaged in extensive past trafficking. We accept the submissions of the [respondent's] counsel that the relevance of that conclusion was either to invite some improper 'rank propensity' reasoning in the manner discussed in Lewis[11], or to invite the jury to reason that the [respondent] was more likely to have acted in accordance with the tendency established by that past conduct, and thus that he was more likely to be in possession of the cannabis for the purposes of selling it. Thus, it seems to us that the reasoning relied upon by the prosecution was In fact, the amount seized was $120,800. 8 Falzon [2017] VSCA 74 at [146]. (1986) 24 A Crim R 112. 10 Falzon [2017] VSCA 74 at [147]. 11 (1989) 46 A Crim R 365. Bell Nettle Gordon either rank propensity reasoning, or tendency reasoning. No matter which, the evidence was inadmissible. Indeed, if the evidence is properly to be characterised as tendency evidence, it was wrongly admitted without any consideration of the relevant statutory criteria." As is apparent from their reasons, their Honours drew support for their conclusion from the decision in Lewis12 and purported to distinguish other cases13, which decided to the contrary, on the basis that, ordinarily, it is the finding of cash contiguously with other incriminating articles that are themselves the accoutrements of drug trafficking which is relevant to proof of the accused person's participation in such activity, whereas, in this case, the prosecution failed to show a relationship between the sum of cash found at Essendon and the trafficking at the Sunshine North and Sydenham properties14. Their Honours added that if their conclusion were incorrect, the probative value of the evidence was low and was outweighed by the risk of unfair prejudice to the respondent, such that it should have been excluded pursuant to s 137 of the Evidence Act 2008 (Vic)15. The majority concluded that the admission of the evidence had infected both the conviction of cultivation at the Sunshine North properties and the conviction of trafficking at Sydenham. Accordingly, the convictions on Charges 2 and 3 were set aside16. Whelan JA, in dissent, reasoned to the contrary17 that the evidence of the respondent's possession of the cash was evidence of a circumstantial fact properly to be considered by the jury in conjunction with other evidence in determining whether the respondent was, as at 17 December 2013, conducting a 12 (1989) 46 A Crim R 365. 13 McGhee (1993) 61 SASR 208; Sultana (1994) 74 A Crim R 27; Blackwell (1996) 87 A Crim R 289; Edwards [1998] 2 VR 354; Evans [1999] WASCA 252. 14 Falzon [2017] VSCA 74 at [145]. 15 Falzon [2017] VSCA 74 at [148]. 16 Falzon [2017] VSCA 74 at [149], [152]. 17 Falzon [2017] VSCA 74 at [66]. Bell Nettle Gordon drug trafficking business: because, if that were established, it made it the more probable that the respondent's purpose in possessing the cannabis of which he was found in possession was the purpose of sale and not for his own use. His Honour added18 that the fact that the respondent was charged with possession for the purpose of sale on a particular date rather than with trafficking over a period of time on the so-called Giretti19 basis was immaterial. His Honour observed that the offenders in R v McGhee20, Sultana21, Blackwell22, R v Edwards23 and Evans v The Queen24 were similarly charged with possession for the purpose of sale on a particular date rather than trafficking over a period of time. Equally, in his Honour's view, the relevance of the evidence of possession of the cash was not lessened by the lack of physical proximity or propinquity between the respondent's home at Essendon, where the cash was found, and the properties at Sunshine North and Sydenham, where the cannabis was located: because there was evidence connecting the items found at each location. In addition to the connections already mentioned, Whelan JA noted that, on the respondent's own version of events, the packaged cannabis found at his home at Essendon, where the cash was located, was harvested from the plants which he admitted cultivating at Sydenham25. Whelan JA was also of opinion that the probative value of the evidence of the cash was such as compared to its prejudicial effect that the trial judge was not in error in refusing to exclude the evidence under s 137 of the Evidence Act26. 18 Falzon [2017] VSCA 74 at [68]. 19 (1986) 24 A Crim R 112. 20 (1993) 61 SASR 208. 21 (1994) 74 A Crim R 27. 22 (1996) 87 A Crim R 289. 24 [1999] WASCA 252. 25 Falzon [2017] VSCA 74 at [69]. 26 Falzon [2017] VSCA 74 at [72]. Bell Nettle Gordon The appeal to this Court The Crown appealed from the Court of Appeal's judgment on one ground only, namely, that the majority erred in concluding that a substantial miscarriage of justice had occurred as a result of the trial judge admitting evidence at trial of the $120,800 that was found at Essendon. Intermediate appellate court decisions in respect of the admissibility of cash In Lewis27, police attended the appellant's flat and found him in possession of 118 grams of cannabis as well as $750 in $50 notes under his mattress and $2,000 in $100 and $50 notes in the pocket of his jacket. They seized the cash, along with an envelope on which there were a number of figures and calculations and the first names of three people. The appellant was charged with possession of cannabis for the purpose of supply. Before the trial, defence counsel objected to the tender of the cash. The trial judge ruled that the cash was relevant to whether the appellant's purpose in having the cannabis was for the purpose of supply28. The appellant was subsequently convicted of the charge and appealed on the basis that the cash was wrongly admitted into evidence. That ground of appeal was upheld by a majority of the Court of Criminal Appeal of the Supreme Court of the Northern Territory29. But it is the decision of Rice J in dissent which has ultimately prevailed in subsequent authority. Rice J held that the evidence of the cash was admissible as it had probative value as evidence of a business in the sale of drugs and, in turn, evidence of the purpose for which the appellant had the cannabis in his possession in relation to the charge against him30. The reasoning of Rice J was followed by Cox J in McGhee31. In that case, police raided a house occupied by the accused in which they found amphetamine and cannabis, and, amongst other things, two sets of scales, a pistol and holster and ammunition, a wallet containing $900 in cash and a packet of amphetamine, 27 (1989) 46 A Crim R 365 at 369 per Martin J. 28 (1989) 46 A Crim R 365 at 370-371. 29 (1989) 46 A Crim R 365 at 373 per Martin J, 376 per Angel J. 30 (1989) 46 A Crim R 365 at 367. 31 (1993) 61 SASR 208 at 210-211. Bell Nettle Gordon and $110 in cash in a pair of jeans apparently belonging to the accused32. The accused was charged with two offences of possessing methylamphetamine for sale and possessing cannabis for sale. Defence counsel objected to the tender of the money in the wallet. Cox J held that it was admissible as tending to prove the existence of an ongoing business, and, therefore, as tending to prove that the accused's possession of illegal drugs on the particular occasion was for the purpose of sale33. His Honour added that, if the accused were running a drug business at the time of the offence, it would be reasonable, in the absence of any plausible alternative explanation, to regard the $900 cash, or at least part of it, as "working capital" or a "cash float" for expected sales34. The Full Court of the Supreme Court of South Australia sitting as the Court of Criminal Appeal followed the decision of Cox J in Blackwell35. In that case, police found the appellant in possession of heroin and a can of tear gas or mace on the footpath outside his house. They then searched his house and found, amongst other things, a set of scales, a pen pistol and a quantity of ammunition capable of being fired in the pen pistol36. The appellant was convicted for possession of heroin for the purposes of sale. The Court of Criminal Appeal rejected the appellant's argument that the trial judge erred in admitting the pen pistol and the can of tear gas or mace into evidence, holding that it is "well accepted that if, in addition to being found in possession of drugs, a person is found also to have items commonly associated with drug dealing, then the finding of such items usually will be relevant as part of the circumstantial material to establish the purpose for which the drug was in that person's possession"37. 32 (1993) 61 SASR 208 at 208-209. 33 (1993) 61 SASR 208 at 210-211. 34 (1993) 61 SASR 208 at 209-210. 35 (1996) 87 A Crim R 289 at 290-291 per Duggan J (Prior J and Debelle J agreeing 36 (1996) 87 A Crim R 289 at 289-290 per Duggan J (Prior J and Debelle J agreeing 37 (1996) 87 A Crim R 289 at 290 per Duggan J (Prior J and Debelle J agreeing at Bell Nettle Gordon In Sultana38, the appellant was convicted of supplying a prohibited drug, namely, heroin, on 30 January 1992. On that day, police intercepted the appellant while driving and found heroin in his wallet in his pocket. Police subsequently searched his residence and found several items including almost $30,000 in cash in various denominations39. On appeal, the appellant complained of the admission of evidence of the finding of those items. The Court of Criminal Appeal of the Supreme Court of New South Wales rejected that argument40. Gleeson CJ explained that evidence of that kind was frequently received on the basis that the Crown is entitled to show that the accused was possessed of the implements or accoutrements of trade of a drug dealer41. His Honour summarised the position thus42: "Where the issues are whether a person was found in possession of [a prohibited drug], and whether he or she possessed it for supply, the fact that the person is currently in the business of a drug-dealer is a fact relevant to the issues in the case. It is not mere evidence of propensity to commit crime, or bad character … Evidence that tends to show that a person is in the business of dealing in [a prohibited drug] also tends to show a propensity towards crime, but in a case such as the present it is admissible on the former account, not the latter. Moreover, subject to discretionary considerations … the fact that it bears the latter character does not detract from its relevance or render it inadmissible." In Edwards, the Court of Appeal of the Supreme Court of Victoria relied43 on Sultana in dismissing an application for leave to appeal against a conviction for trafficking in amphetamines. Police found $3,020 cash and a firearm on the 38 (1994) 74 A Crim R 27. 39 (1994) 74 A Crim R 27 at 32-33 per Sully J. 40 (1994) 74 A Crim R 27 at 28-30 per Gleeson CJ (Handley JA agreeing at 32), 36- 41 (1994) 74 A Crim R 27 at 28. 42 (1994) 74 A Crim R 27 at 29. 43 [1998] 2 VR 354 at 368-369 per Eames AJA (Hayne JA and Batt JA agreeing at Bell Nettle Gordon applicant, and drugs and ammunition for the firearm in his car44. The applicant sought leave to appeal on the basis, inter alia, that the trial judge had wrongly admitted evidence of the finding of the cash. Eames AJA (with whom Hayne JA and Batt JA agreed) rejected45 the proposed ground of appeal and emphasised that the evidence of the finding of the cash gained its force, and was admissible, by virtue of it not being taken in isolation but combined with the other incriminating items. The Court of Criminal Appeal of the Supreme Court of Western Australia canvassed these cases in Evans46. In Evans, the appellant sought to appeal against his conviction for possession of a quantity of 3,4 methylenedioxy-n alpha-dimethylphenylethylamine (MDMA) with intent to sell or supply it to another. The MDMA had been found in the appellant's car and on his person along with a sum of $895 in cash47. He argued that the trial judge erred in admitting the evidence of the cash. At trial, the purpose of possession was not a fact in issue on the defence case because the appellant denied knowledge of the presence of the drug in his car. The Court of Criminal Appeal held, however, in accordance with Sultana, McGhee and Rice J's dissent in Lewis that the evidence of the cash was relevant and therefore admissible both in support of the Crown's case that the appellant was in possession of the drugs and to rebut any defence that he was in possession of the drugs for his own use48. Relevance of the evidence of the cash Whelan JA was plainly correct that the evidence of the cash found at the respondent's home at Essendon was admissible49 as an item of circumstantial 44 [1998] 2 VR 354 at 357-358 per Eames AJA (Hayne JA and Batt JA agreeing at 45 [1998] 2 VR 354 at 369-370 (Hayne JA and Batt JA agreeing at 356). 46 [1999] WASCA 252 at [31]-[35] per Malcolm CJ (White J agreeing at [66]), [65] 47 [1999] WASCA 252 at [1]-[3] per Malcolm CJ (White J agreeing at [66]). 48 [1999] WASCA 252 at [31]-[38] per Malcolm CJ (White J agreeing at [66]), [65] 49 Evidence Act, ss 55 and 56. Bell Nettle Gordon evidence that, in conjunction with evidence of other indicia of drug trafficking, was capable of founding the inference that, as at 17 December 2013, the respondent was carrying on a business of trafficking in cannabis, and thus that the respondent's purpose in possessing the quantities of cannabis found at the Sunshine North and Sydenham properties was the purpose of sale. Contrary to the majority's apparent process of reasoning, the fact that, if the cash came from trafficking, it must have come from trafficking in cannabis other than the cannabis found on 17 December 2013, does not detract from the strength of the inference that the cash was part and parcel of the business of drug trafficking which the respondent was carrying on as at 17 December 2013. To the contrary, the fact that the cash was likely to have come from previous sales of cannabis – a conclusion strengthened by the expert evidence of drug traffickers' inclinations to transact drug deals in cash and the tax return evidence of the respondent's failure to declare the cash as part of his assessable income – fortified the probability of the respondent making regular and recurring sales of cannabis, and thus that, as at 17 December 2013, the respondent had been carrying on a continuing business of trafficking in cannabis. More specifically, the fact that the cash was likely to have come from previous sales of cannabis logically bespoke the probability that the respondent kept the cash on hand on 17 December 2013 as an asset of a continuing business of trafficking in cannabis in the course of which he intended to sell the cannabis that he possessed on 17 December 2013. The significance which the majority attributed to the fact that the prosecution had eschewed reliance on a Giretti count was, as Whelan JA observed, misplaced. For the same reason, the majority were wrong in holding that the only relevance of the evidence of the respondent's possession of the cash was "rank propensity reasoning, or tendency reasoning"; by which their Honours are taken to have meant reasoning to the effect that, because the respondent was shown to have committed past acts of trafficking in cannabis, he could be perceived as the sort of person who was likely or more likely to commit the acts of trafficking with which he was charged50. Granted, the evidence of the respondent's possession of the cash implied that the respondent had committed previous acts of trafficking, but the purpose of its admission was not to establish that the respondent was the sort of person who was disposed to commit acts of trafficking. Rather, as the trial judge made clear in his ruling, and Whelan JA 50 BBH v The Queen (2012) 245 CLR 499 at 525 [70]-[71] per Hayne J; [2012] HCA Bell Nettle Gordon correctly recognised in his judgment, the purpose for which the evidence was admitted, and the way in which the Crown relied upon it, was to establish that the respondent was in fact carrying on a business of trafficking and, therefore, that the respondent's purpose in possessing the cannabis of which he was found to be in possession on 17 December 2013 was the purpose of sale. Nor did the fact that that evidence tended to show the commission of other offences of trafficking render it inadmissible. As Lord Herschell LC said in Makin v Attorney-General for New South Wales51, the mere fact that evidence tends to show the commission of other crimes does not of itself render it inadmissible if it is relevant to an issue before the jury, and it may be so, among other circumstances, to establish the elements of the offence charged or to rebut a defence which would otherwise have been open to the accused. Here, the evidence was relevant to establish the element of intent to sell and to counter the respondent's claim that the cannabis was possessed for personal consumption. And, as has been noticed, the fact that such evidence is admissible in relation to the proof of drug trafficking offences despite disclosing previous offences is plainly established by the authorities McGhee, Sultana, Blackwell, Edwards and Evans. As those decisions make clear, subject to exclusion under s 137 of the Evidence Act or in exercise of the Christie52 discretion in those jurisdictions where common law rules of evidence still apply, where an accused is charged with possession of a prohibited drug with intent to sell, circumstantial evidence that the accused was at that time carrying on a business of drug trafficking is relevant and admissible to establish the purpose for which the accused possessed the drug in issue. As Whelan JA also observed, the facts of this matter are relevantly indistinguishable from those of McGhee, Sultana, Blackwell, Edwards and Evans. The lack of physical proximity or propinquity between the cash at Essendon and the cannabis located at the Sunshine North and Sydenham properties is beside the point. Given the evidence of interconnection between the Essendon property and the cultivation operations at the Sunshine North and Sydenham properties, and the cannabis and other drug trafficking paraphernalia found at Essendon, it was well open to the jury to infer that the cash at Essendon 51 [1894] AC 57 at 65. See also Martin v Osborne (1936) 55 CLR 367 at 375 per Dixon J; [1936] HCA 23; Markby v The Queen (1978) 140 CLR 108 at 116 per Gibbs ACJ; [1978] HCA 29. 52 R v Christie [1914] AC 545. Bell Nettle Gordon was sourced in the sales of the cannabis grown at the Sunshine North and Sydenham properties. Indeed, before this Court, so much was not disputed. Almost from the outset of oral argument, counsel for the respondent entirely abandoned reliance on physical separation of the cash from the cannabis as a point of relevant distinction. Exclusion of the evidence of the cash under s 137 of the Evidence Act The majority in the Court of Appeal were further in error in their approach to s 137 of the Evidence Act. The probative value of the evidence of the cash found at Essendon was not low. It was high. Combined with the other circumstantial evidence of the respondent's carrying on of a business of drug trafficking, including the respondent's admission as to having cultivated the cannabis at Sydenham, the physical paraphernalia of drug trafficking and the large quantities of cannabis found at the Sunshine North and Sydenham properties, the evidence of the cash found at Essendon constituted a powerful circumstantial case that the respondent was engaged in a business of cultivating and selling cannabis and, therefore, that his purpose for being in possession of the cannabis found at the Sunshine North and Sydenham properties on 17 December 2013 was the purpose of sale. Admittedly, the evidence of the cash was prejudicial to the respondent in the sense of assisting to demonstrate that the respondent's purpose in possessing the cannabis found on 17 December 2013 was the purpose of sale. That is why it was admissible. But it was not to any significant extent unfairly prejudicial. By comparison to the probative value of the evidence of the respondent's possession of the cash as circumstantial evidence that the respondent was, as at 17 December 2013, carrying on a business of selling cannabis, the likelihood of the jury improperly reasoning from the evidence of the respondent's possession of the cash that, because the respondent had committed past acts of trafficking, he was the sort of person who was more likely to commit those charged, was minimal; especially given that the trial judge specifically directed the jury that they were not to think that because a person breaks the law in one instance, he is likely to break the law in another. Views might differ as to whether defence counsel should have applied under s 12 of the Jury Directions Act 2015 (Vic)53 for a more specific or detailed anti-propensity reasoning direction. But, as Whelan JA observed54 and counsel 53 See also Jury Directions Act 2015 (Vic), s 29. 54 Falzon [2017] VSCA 74 at [76]. Bell Nettle Gordon for the respondent effectively acknowledged before this Court, it is apparent that defence counsel had good forensic reason not to seek such a direction. Making a larger issue of propensity reasoning could well have been more detrimental to the respondent than saying nothing further about it. The same is true of any application that might have been made under s 136 of the Evidence Act for an order limiting the use which could be made of the evidence of the cash. The trial judge was not required to make such an order unless defence counsel applied for it55, and, for the reasons already given, it is readily understandable why defence counsel did not do so. Further direction under s 16 of the Jury Directions Act Having abandoned physical separation of the cash from the cannabis as a point of relevant distinction from previous authority, and despite conceding that defence counsel had good forensic reason not to apply for a further anti- propensity reasoning direction, counsel for the respondent nevertheless submitted before this Court that the trial judge should have given a further and more detailed anti-propensity reasoning direction of his Honour's own motion, pursuant to s 16 of the Jury Directions Act, and that his Honour's failure to do so was productive of a substantial miscarriage of justice. Quite apart from the fact that no such argument was communicated in a Notice of Contention or mentioned in the respondent's written submissions or outline of oral argument, the submission is entirely without merit. In the absence of an application for such a direction under s 12 of the Jury Directions Act, the trial judge was precluded by ss 15 and 16 of that Act from giving any such direction unless his Honour considered that there were substantial and compelling reasons to do so. And given, as is conceded, that such a direction had the potential to be more detrimental to the respondent than saying nothing further about the subject, the trial judge could not properly have concluded that there were substantial and compelling reasons to override defence counsel's judgment. 55 See and compare Mulcahy v The Queen [2012] ACTCA 3 at [82]; Poniris v The Queen [2014] NSWCCA 100 at [50] per Macfarlan JA (Adamson J and Bellew J agreeing at [83], [84]). Bell Nettle Gordon Adherence to authority It remains to mention one further matter. As this Court has emphasised on several occasions56, Australian intermediate appellate courts are bound to follow the decisions of other Australian intermediate appellate courts in both matters of statutory interpretation and matters of common law unless persuaded that those decisions are plainly wrong. In this case, as has been explained, the admissibility of the evidence of the cash found at Essendon, as circumstantial evidence of drug trafficking and, therefore, as probative of intent to sell, was supported by a succession of decisions of other Australian intermediate appellate courts including an important previous decision of the Court of Appeal of the Supreme Court of Victoria57 which has been followed in other States58. The majority in the Court of Appeal in this matter did not suggest that those decisions were plainly wrong and could not properly have considered them to be so. Rather, the majority purported to distinguish those previous decisions on the now concededly untenable basis of physical separation of the cash from the cannabis and the patent misconception that the evidence was unfairly prejudicial to the respondent. So to hold was in effect to refuse to follow those earlier decisions while purporting to observe them. That was not a course properly open to the majority and it should not be repeated. 56 Australian Securities Commission v Marlborough Gold Mines Ltd (1993) 177 CLR 485 at 492; [1993] HCA 15; Farah Constructions Pty Ltd v Say-Dee Pty Ltd (2007) 230 CLR 89 at 151-152 [135]; [2007] HCA 22; CAL No 14 Pty Ltd v Motor Accidents Insurance Board (2009) 239 CLR 390 at 411-412 [49] per Gummow, Heydon and Crennan JJ; [2009] HCA 47; Hili v The Queen (2010) 242 CLR 520 at 538 [57] per French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ; [2010] HCA 45. 57 Edwards [1998] 2 VR 354. 58 See for example O'Driscoll (2003) 57 NSWLR 416 at 432 [77] per Spigelman CJ (Carruthers AJ agreeing at 443 [149]); Roland (2015) 252 A Crim R 399 at 401 [4].

HIGH COURT OF AUSTRALIA LIBERTYWORKS INC PLAINTIFF AND COMMONWEALTH OF AUSTRALIA DEFENDANT LibertyWorks Inc v Commonwealth of Australia [2021] HCA 18 Date of Hearing: 2 March 2021 Date of Judgment: 16 June 2021 ORDER The questions of law stated in the Amended Special Case filed on 1 March 2021 be answered as follows: Is the Foreign Influence Transparency Scheme Act 2018 (Cth) invalid, to the extent it imposes registration obligations with respect to communications activities, on the ground that it infringes the implied freedom of political communication? Answer: In light of the answer to question 1, what relief, if any, should issue? Answer: None. 3. Who should pay the costs of and incidental to this special case? Answer: The plaintiff should pay the defendant's costs. Representation P J Dunning QC with R Scheelings for the plaintiff (instructed by Speed and Stracey Lawyers) S P Donaghue QC, Solicitor-General of the Commonwealth, with B K Lim and S Zeleznikow for the defendant (instructed by Australian Government Solicitor) M G Sexton SC, Solicitor-General for the State of New South Wales, with S Robertson for the Attorney-General for the State of New South Wales, intervening (instructed by Crown Solicitor's Office (NSW)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS LibertyWorks Inc v Commonwealth of Australia Constitutional law (Cth) – Implied freedom of communication about governmental or political matters ("implied freedom") – Where Foreign Influence Transparency Scheme Act 2018 (Cth) ("Act") included registration requirement for persons undertaking communications activity on behalf of foreign principal for purpose of political or governmental influence – Where foreign principal defined to include foreign political organisation – Where plaintiff undertook registrable activities on behalf of foreign political organisation in holding annual Conservative Political Action Conference events which constituted communications activity – Whether Act to extent it imposes registration obligations with respect to communications activity undertaken on behalf of foreign principal effectively burdens implied freedom – Whether provisions for legitimate purpose – Whether provisions suitable, necessary and adequate in balance. Words and phrases – "adequate in its balance", "burden", "communications activity", "compelling justification", "disclosure", "foreign influence", "foreign interference", "foreign political organisation", "foreign principal", "legitimate tailored", "necessary", "political or governmental purpose", "narrowly influence", "prior restraint", "register", "registration", "scheme information", "structured proportionality", "suitable", "transparency", "undisclosed influence". Foreign Influence Transparency Scheme Act 2018 (Cth), ss 11, 12, 13, 16, 18, Foreign Influence Transparency Scheme (Disclosure in Communications Activity) Rules 2018 (Cth). Foreign Influence Transparency Scheme Rules 2018 (Cth), s 6. KIEFEL CJ, KEANE AND GLEESON JJ. The plaintiff, LibertyWorks Inc, was incorporated in 2015 under the Associations Incorporation Act 1981 (Qld). It presently has 1,290 members in Australia. It is described in the Amended Special Case as "a private think-tank with an aim to move public policy in the direction of increased individual rights and freedoms, including the promotion of freedom of speech and political communication". Since its incorporation the plaintiff has organised political conferences parliamentary enquiries on freedom of political speech. It maintains a website from which it has published more than 200 posts which seek to raise awareness of individual freedom in public policy and it maintains a social media presence. in Australia and made submissions The American Conservative Union ("the ACU") was established as a corporation in the United States of America for the promotion of political freedom and for the purpose of influencing politics and politicians in that country from what is described in the Amended Special Case as a "conservative/classical liberal" perspective. Its Articles of Incorporation refer to its objects as being to foster and develop "a greater understanding and awareness of the tenets set forth in the Constitution of the United States and the Declaration of Independence to the end that the individual citizen shall understand, preserve and defend his or her inherent rights, liberties and responsibilities and cherish the principles upon which the Republic was founded". A statement on the website of the ACU refers to its purpose as being to "harness the collective strength of the conservative movement and support the campaigns of conservative candidates". To this end the ACU organises and holds an annual multi-day political conference in the United States called the "Conservative Political Action Conference" ("CPAC"). Prominent people, including the immediate past President and Vice-President of the United States, government officials and sections of the media have attended CPAC. At a meeting in 2018 between the President of the plaintiff and the Executive Director of the ACU it was agreed that the plaintiff and the ACU would collaborate in a CPAC event to be held in Australia in 2019, and that the ACU would provide the plaintiff with the names of speakers and otherwise assist to ensure its success. Since then the ACU has registered the word "CPAC" and a CPAC logo as trademarks in Australia. The CPAC event the subject of the discussions was held in Sydney in August 2019 and was widely marketed by the plaintiff. The CPAC event featured speakers from Australia, the United States, England and Japan. It included politicians (past and present), media personalities, members of "think tanks", economists and social commentators. The promotional material for the event described the ACU as the "Think Tank Host Partners" and a "co-host" of it with the plaintiff. The Chairman, Executive Director and another board member of the ACU, together with ACU staff, attended the CPAC event. According to the Amended Special Case, another CPAC event was proposed to be held in Australia in November 2020. A Deputy Secretary of the Attorney-General's Department wrote to the President of the plaintiff in August 2019 concerning the upcoming CPAC event to be presented by the plaintiff and the ACU. The Deputy Secretary outlined the scheme of the Foreign Influence Transparency Scheme Act 2018 (Cth) ("the FITS Act"), and observed that the ACU would appear to fall within the definition of a "foreign political organisation" and therefore would be considered a "foreign principal" and that an event such as the CPAC event would appear to be a "communications activity". The plaintiff was asked to consider whether it was required to register its arrangements with the ACU under the scheme. Further correspondence followed, including a notice purporting to be given under s 45 of the FITS Act, which required information and documents which might enable the Deputy Secretary to determine whether the plaintiff was liable to register. The notice was not complied with and ultimately was not further pursued. The plaintiff has not to date registered under the FITS Act. The plaintiff claims that the provisions of the FITS Act respecting communications activity by a person who acts on behalf of a foreign principal burden the freedom of political communication which is implied by the Constitution, cannot be justified and are therefore invalid. Foreign influence – agreed facts It is agreed between the parties to this Amended Special Case that in recent years there has been a global trend of attempts at the foreign influence of democratic processes. Official reports1 have concluded that a foreign country sought to undermine the Brexit referendum in the United Kingdom, the 2016 Presidential election in the United States and the 2017 French Presidential election. Foreign actors in many countries have also sought to exert covert influence through the use of both traditional and social media, including by spreading disinformation 1 Mueller, Report on the Investigation into Russian Interference in the 2016 Presidential Election (2019), vol 1 at 1-5, 14-15; United Kingdom, House of Commons, Digital, Culture, Media and Sport Committee, Disinformation and 'Fake News': Final Report (2019) at 68-71, 72; United Kingdom, Intelligence and Security Committee of Parliament, Russia (2020) at 5, 9. and propaganda. Two social media platforms have taken action against cyber troops engaged in foreign influence operations in at least seven countries2. At the time that the FITS Act was enacted the Australian Security Intelligence Organisation ("ASIO") had warned that espionage and foreign interference activity against Australia's interests was "occurring at an unprecedented scale"3. Australia was experiencing undisclosed foreign influence both in respect of government and political systems and processes and more broadly identified foreign powers clandestinely seeking to shape the opinions of members of the Australian public, media organisations and government officials to advance their own countries' political objectives, including through the recruitment and co-opting of influential and powerful Australian voices to lobby decision-makers. It identified ethnic and religious communities in Australia as the subjects of covert influence operations designed to diminish their criticism of foreign governments4. The parties agree that there is a distinction to be drawn between foreign interference and foreign influence. The parties agree that foreign influence may be taken to refer to activities undertaken on behalf of a foreign principal that influence government and political systems and processes. Foreign influence will amount to foreign interference if it is undertaken using covert, deceptive, corrupting or threatening means to damage or destabilise the government or political processes In Australia, ASIO reports, foreign principals often pursue their own interests by engaging Australians to seek to influence governments and others on 2 Bradshaw and Howard, The Global Disinformation Order: 2019 Global Inventory of Organised Social Media Manipulation (2019) at 2. Parliamentary Joint Committee on Intelligence and Security, Advisory Report on the Foreign Influence Transparency Scheme Bill 2017 (2018) at 2. 4 Australian Security Intelligence Organisation, ASIO Annual Report 2017-18 (2018) at 3, 25; Parliamentary Joint Committee on Intelligence and Security, Advisory Report on the Foreign Influence Transparency Scheme Bill 2017 (2018) at 2-5. 5 Australian Security Intelligence Organisation, ASIO Annual Report 2017-18 (2018) at 25; Parliamentary Joint Committee on Intelligence and Security, Advisory Report on the Foreign Influence Transparency Scheme Bill 2017 (2018) at 6-7, 9-11, 17, 166-167; Australian Security Intelligence Organisation, Director-General's Annual Threat Assessment (2020) at 9. their behalf. Almost every sector of the Australian community is a potential target for foreign influence but this is said to be particularly true in relation to parliamentarians and their staff, government officials, business leaders, the university community, and the media and opinion-makers6. it can impede left undisclosed Even when the purpose of the foreign influence is not to damage or destabilise Australia, the ability of decision-makers in Australia, and the Australian public, to make informed decisions because it can conceal the nature of the competing interests at play. The parties agree that transparency of foreign influence can contribute to the effective functioning and accountability of Australian government institutions and help protect their integrity by reducing the risk that foreign influence will result in foreign interests prevailing over domestic interests by ensuring that the Australian public can assess the nature, level and extent of foreign influence in respect of particular decisions or processes accurately7. The FITS Act The FITS Act was enacted as part of a package of legislative reforms alongside the Electoral Legislation Amendment (Electoral Funding and Disclosure Reform) Act 2018 (Cth) and the National Security Legislation Amendment (Espionage and Foreign Interference) Act 2018 (Cth). As the name of the latter Act implies, it is addressed to the risk of foreign interference. The object of the FITS Act is stated in s 3 to be: "to provide for a scheme for the registration of persons who undertake certain activities on behalf of foreign governments and other foreign principals, in order to improve the transparency of their activities on behalf of those foreign principals." 6 Australian Security Intelligence Organisation, Director-General's Annual Threat Assessment (2020) at 9. Parliamentary Joint Committee on Intelligence and Security, Advisory Report on the Foreign Influence Transparency Scheme Bill 2017 (2018) at 10-12; Attorney- General's Department, Parliamentary Joint Committee on Intelligence and Security, Attorney-General's Department Submission, Inquiry into the Foreign Influence Transparency Scheme Bill 2017 (2018) at 3, 9-10. A "foreign principal" is defined by s 10 to mean: a foreign government; a foreign government related entity; a foreign political organisation; a foreign government related individual." Each foreign principal is then further defined. Attention in this matter is focussed on the entity in para (c), which is defined by s 10 to include a foreign organisation that exists primarily to pursue political objectives. It is accepted that it applies to the ACU. Broadly speaking and as relevant to the primary question before the Court the scheme of the FITS Act may be understood to require a person to register details about themselves and their foreign principal with the Secretary8 where the person communicates or distributes information or material to the Australian public or a section of it under an arrangement with, in the service of or under the order or direction of a foreign principal; where the person and the foreign principal expect that that activity will be undertaken; and where it is undertaken for the sole or substantial purpose of political or governmental influence, which includes influencing the public. Liability to register Part 2 of the FITS Act deals with registration under the scheme. Section 16(1) ("Requirement to register") provides that: "(1) A person who: becomes liable to register under the scheme in relation to a foreign principal; and is not already registered under the scheme in relation to the foreign principal; 8 The Secretary of the Attorney-General's Department: see Acts Interpretation Act 1901 (Cth), s 19A and the example therein; Administrative Arrangements Order (Cth), 5 December 2019. must apply to the Secretary for registration in relation to the foreign principal, no later than 14 days after becoming liable." "Person" is defined widely9. Section 16(2) lists the requirements for an application, including that it be accompanied by any information or documents required by the Secretary10. Section 18(1) identifies the persons who are liable to register: If a person: undertakes an activity on behalf of a foreign principal that is registrable in relation to the foreign principal; or enters a registrable arrangement with a foreign principal; the person becomes liable to register under the scheme in relation to the foreign principal." For the purposes of s 18(1)(a), s 11(1) provides that a person "undertakes an activity on behalf of a foreign principal" if: the person undertakes the activity in any of the following circumstances: (i) under an arrangement[11] with the foreign principal; (ii) in the service of the foreign principal; (iii) on the order or at the request of the foreign principal; (iv) under the direction of the foreign principal; and See s 10. 10 s 16(2)(d). 11 "Arrangement" is defined to include a contract, agreement, understanding or other arrangement of any kind, whether written or unwritten: s 10. at the time the arrangement or service is entered into, or the order, request or direction made, both the person and the foreign principal knew or expected that: (i) the person would or might undertake the activity; and (ii) the person would or might do so in circumstances set out in section 20, 21, 22 or 23 (whether or not the parties expressly considered the existence of the scheme)." It does not matter whether consideration is payable for the purposes of s 11(1)12. Section 18(1)(a) directs attention to what is a "registrable activity". A "registrable arrangement", referred to in s 18(1)(b), is defined by s 13A to be an arrangement between a person and a foreign principal to undertake, on behalf of the foreign principal, one or more activities that, if undertaken by the person, would be registrable in relation to the foreign principal in circumstances where the person is not exempt. The definition therefore also directs attention to registrable activities. Registrable activities The definition of "registrable activity" in s 10 directs the reader to ss 20 to 23 inclusive, which provisions also appear in Pt 2. Section 20 concerns parliamentary lobbying on behalf of a foreign government; ss 22 and 23 deal respectively with activities involving "former Cabinet Ministers" and "recent designated position holders". Section 21 concerns "activities in Australia for the purpose of political or governmental influence". In a table in s 21(1), four activities undertaken in Australia are listed together with the kind of foreign principal on whose behalf the person acts in connection with those activities. To be registrable an activity must be one covered by an item of the table; the foreign principal must be the kind of foreign principal specified for the activity in the table; and the person who undertakes the activity on behalf of the foreign principal must not be exempt under Div 4 in relation to the activity13. Item 1 of the table refers to the activity of parliamentary lobbying on behalf of a foreign government related entity, a foreign political organisation or a foreign government related individual. Items 2 and 4 respectively refer to general 13 s 21(1)(a), (b) and (c). political lobbying and disbursement activity with any kind of foreign principal. Each of the activities listed in Items 1, 2 and 4 is further defined14. The focus of the plaintiff's case is on Item 3 of the table. It refers to "communications activity" carried out on behalf of any kind of foreign principal. A person is said by s 13(1) to undertake "communications activity" if: the person communicates or distributes information or material to the public or a section of the public; or the person produces information or material for the purpose of the information or material being communicated or distributed to the public or a section of the public." Information or material may take any form15. To be registrable, each of the activities listed in the table in s 21(1), including communications activity, must be carried out "for the purpose of political or governmental influence". "Influence" includes "affect in any way"16. The purpose of political or governmental influence Section 12(1) provides that: "A person undertakes an activity for the purpose of political or governmental influence if the sole or primary purpose, or a substantial purpose, of the activity is to influence one or more of the following: There are seven processes or proceedings then listed in the sub-section. They include those relating to a federal election, a federal government decision, proceedings of a House of the Parliament, a registered political party, a candidate who is not endorsed by a registered political party and a registered political campaigner17. 14 See s 10. 16 See s 10. 17 See s 12(1). Section 12(2) provides that: "A person also undertakes an activity for the purposes of political or governmental influence if the sole or primary purpose, or a substantial purpose, of the activity is to influence the public, or a section of the public, in relation to a process or proceedings mentioned in subsection (1)." By s 14, the purpose of an activity must be determined having regard to: the intention of the person undertaking the activity or that person's belief (if any) about the intention of any foreign principal on whose behalf the activity is undertaken; and either or both of the following: the intention of any foreign principal on whose behalf the activity is undertaken; all of the circumstances in which the activity is undertaken." Exemptions The provisions of Pt 2, Div 4 render a person exempt from registration in relation to certain activities that the person undertakes on behalf of a foreign principal. They include humanitarian aid or assistance18; the provision of legal advice or representation19; religious activities20; registered charities21; artistic purposes22; and the activities of members of certain professions23. A person is exempt in relation to diplomatic or consular activities24 and activities undertaken 21 s 29C. 22 s 29D. 23 s 29F. in the person's capacity as an officer or employee of a foreign government in the name of that foreign government25. Responsibilities following registration A person is registered under the scheme from the day the application is given to the Secretary until the registration ends26. Provision is made for ending registration where a person is satisfied, in effect, that they are no longer required to register27. A person who is registered under the FITS Act has certain responsibilities, which are set out in Pt 3, Divs 2 and 3. The person is required to report material changes in circumstances28; report disbursement activity for the purpose of political or governmental influence29; review the information given at registration and give notice that it is up to date or update it when a voting period30 for federal elections and referendums begins31; and during the voting period give the Secretary notice of any registrable activity undertaken other than disbursement activity32. A person who remains liable to register must renew the registration annually33. Section 40(1) requires a person who is registered under the scheme in relation to a foreign principal to keep records whilst registered under the scheme and for three years after the registration ends. The matters in respect of which records must be kept are registrable activities undertaken by the person on behalf of the foreign principal; benefits provided to the person by the foreign principal; 30 "Voting period" is defined: see s 10. information or material forming part of any communications activity that is registrable; registrable arrangements between the person and the foreign principal; and other information or material communicated or distributed to the public or a section of the public in Australia on behalf of the foreign principal34. Disclosure in communications activity Although s 38 ("Disclosure in communications activity") appears in Pt 3, Div 3 ("Other responsibilities"), it places an obligation on any person, not just a registered person, to make a disclosure about the foreign principal when undertaking communications activity on their behalf. It provides that: a person undertakes communications activity on behalf of a foreign principal; and the communications activity is registrable in relation to the foreign principal within the meaning of section 21 (activity in Australia for the purpose of political or governmental influence); the person must make a disclosure about the foreign principal in accordance with rules made for the purposes of subsection (2). The rules[35] may prescribe any or all of the following: instances of communications activity; (b) when and how disclosures are to be made in relation to instances of communications activity; the content, form and manner of disclosures; circumstances in which a person is exempt from making a disclosure." The Foreign Communications Activity) Rules 2018 (Cth) ("the Disclosure Rules") provide in a detailed way for the form and manner of disclosure of different types of Influence Transparency Scheme (Disclosure 35 "Rules" means rules made under s 71: see s 10. communications activity. By way of example, s 5(1) requires that printed material which is communicated or distributed contain a disclosure at the end or bottom of each page of the printed material in a type size that can be easily read. Section 5(2) prescribes the content of the disclosure. It requires the person undertaking the communications activity and the foreign principal to be identified, that a statement that the communications activity is undertaken on behalf of the foreign principal be included and that there be a statement that the disclosure is made under the FITS Act. The register, the Secretary and scheme information Part 4, Div 2 of the FITS Act deals with the register of scheme information which is required to be kept by the Secretary36. The information that is required to be kept on the register includes the name of the person and the foreign principal, the application for registration and any accompanying information, any notices in the nature of reports given to the Secretary, any information prescribed by the rules and any other information the Secretary considers appropriate37. The Secretary is required to make available to the public, on a website, information relating to a person who is registered in relation to a foreign principal. That information includes38 the name of the person and the foreign principal, a description of the kind of registrable activities the person has undertaken or is undertaking on behalf of the foreign principal and any other information required to be made available by rules. However, the website is not to contain any information which the Secretary is satisfied is commercially sensitive, affects national security or is of a kind prescribed by the rules39. The Secretary may correct or update the information made available40. Part 4, Div 4 deals with how scheme information may otherwise be dealt with. It assumes no relevance to the plaintiff's case. If the Secretary reasonably suspects that a person might be liable to register under the scheme but is not registered, the Secretary may give a notice under s 45 requiring the provision of information relevant to the person's liability to register in relation to a foreign principal. Where the Secretary reasonably believes that a person whether registered or not has information or a document that is relevant to the operation of the scheme, the Secretary may give a notice under s 46 requiring such information or documents, or production of copies of such documents. There are requirements respecting the contents of the notice41. Offences and penalties Part 5 deals with enforcement and includes provisions creating offences arising from a person's failure to register or to renew their registration when liable to do so42; giving notice that a person's liability to register has ended while still liable to do so43; and failing to fulfil a person's responsibilities under the scheme44. Offences of the last kind may result in a penalty; those earlier mentioned may result in imprisonment on conviction for terms ranging between six months and five years. The questions on the Amended Special Case The parties have agreed to state the following questions for the opinion of the Full Court: Is the Foreign Influence Transparency Scheme Act 2018 (Cth) invalid, to the extent it imposes registration obligations with respect to communications activities, on the ground that it infringes the implied freedom of political communication? In light of the answer to question 1, what relief, if any, should issue? 3. Who should pay the costs of and incidental to this special case? Question 1 reflects a substantial narrowing of the plaintiff's case concerning the implied freedom of political communication. Prior to its amendment the 43 s 57A. question was stated as whether the FITS Act is "invalid, either in whole or in part (and if in part, to what extent)" on the ground that it infringes the freedom. The relief sought by way of declaration, as relevant to question 2, has correspondingly narrowed. The original declarations sought were that the FITS Act is wholly invalid or invalid so far as it purports to apply to foreign political organisations or to the plaintiff; and in the alternative that s 45 and the offence provisions relating to it are invalid. The reference to s 45 may be explained by an earlier controversy about the notice given to the plaintiff by the Attorney-General's Department requesting information45. The declaration now sought is "that the [FITS Act] is invalid, to the extent it imposes registration obligations with respect to communications activities". In oral argument the plaintiff identified the objectionable feature of the FITS Act as Item 3 of the table in s 21(1), which treats communications activity as a registrable activity and in doing so engages ss 16 and 18 and the requirement of registration. The primary question raised by the parties in the Amended Special Case might be understood in this way. The implied freedom, burdens and justification The constitutional basis for the implication in the Constitution of a freedom of communication on matters of politics and government is well settled46. The freedom is recognised as necessarily implied because the great underlying principle of the Constitution is that citizens are to share equally in political power47 and because it is only by a freedom to communicate on these matters that citizens may exercise a free and informed choice as electors48. It follows that a free flow of communication is necessary to the maintenance of the system of representative government for which the Constitution provides49. The freedom operates as a 45 See [5] above. 46 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520; see also McCloy v New South Wales (2015) 257 CLR 178 at 200 [23]. 47 Harrison Moore, The Constitution of the Commonwealth of Australia (1902) at 329. 48 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 560. 49 Unions NSW v New South Wales (2013) 252 CLR 530 at 551 [27]. constitutional restriction on legislative power and should not be understood to be a personal right50. The freedom is of such importance to representative government that any effective statutory burden upon it must be justified51. That process commences with the identification of the purpose which the statute seeks to achieve. That purpose must be legitimate, which is to say compatible with the constitutionally prescribed system of representative government52. If the statute does not have a legitimate purpose no further consideration will be necessary, for invalidity will be made out. In addition to having the requisite purpose, the law must be shown to be proportionate to the achievement of that purpose. In order to justify a burdensome effect on the freedom a law must be a proportionate, which is to say a rational, response to a perceived mischief53. A law will satisfy the requirements of proportionality if it is suitable, necessary and adequate in its balance54. The parties' arguments on the Amended Special Case address these matters. The plaintiff's submissions also address another question: whether the provisions of the FITS Act are "reasonably appropriate and adapted". The submissions do so by reference to the test of reasonable necessity, but not the other tests of proportionality, and a criterion of whether the provisions are "closely 50 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 560; Wotton v Queensland (2012) 246 CLR 1 at 31 [80]; Unions NSW v New South Wales (2013) 252 CLR 530 at 551 [30], 554 [36]; McCloy v New South Wales (2015) 257 CLR 178 at 202-203 [30]; Brown v Tasmania (2017) 261 CLR 328 at 360 [90]. 51 McCloy v New South Wales (2015) 257 CLR 178 at 213 [68]; Brown v Tasmania (2017) 261 CLR 328 at 369 [127]; Comcare v Banerji (2019) 267 CLR 373 at 399 52 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 561-562, 567; McCloy v New South Wales (2015) 257 CLR 178 at 203 [31]. 53 Clubb v Edwards (2019) 267 CLR 171 at 199-201 [66]-[70]; see also McCloy v New South Wales (2015) 257 CLR 178 at 213 [68]. 54 McCloy v New South Wales (2015) 257 CLR 178 at 193-196 [2]-[4]; Brown v Tasmania (2017) 261 CLR 328 at 368 [123], 416 [278]; Clubb v Edwards (2019) 267 CLR 171 at 200-202 [70]-[74], 264 [266], 311 [408], 330 [463]; Comcare v Banerji (2019) 267 CLR 373 at 400 [32]. tailored" to the achievement of the statutory purpose, which criterion is not further explained. In Lange v Australian Broadcasting Corporation55, the final question as to the validity of a law effecting a burden on the freedom was stated to be whether the burden is "undue" having regard to its purpose56. Whether that question should be determined by reference to a test of whether the law is "reasonably appropriate and adapted" or of whether it is "proportionate" was left open by the Court, as were the means by which those conclusions might be reached. But in McCloy v New South Wales57 a majority of this Court provided the answer, holding that the final question to be addressed is whether a law is a proportionate response to its purpose and that that is to be ascertained by a structured method of proportionality analysis. That approach has consistently been maintained by a majority of this Court in each of the cases concerning the implied freedom since McCloy58 and, more recently, it has been applied by a majority to the freedom guaranteed by s 92 of the Constitution59. The plaintiff's submissions make mention of notions of strict scrutiny. It is said that the present case is "a rare example of in terms regulation of political communication, which is presumptively 'direct' or non-incidental in its burden and so automatically attracts stricter scrutiny". The error in that statement, that the FITS Act regulates political communication, may be put to one side. As New South Wales, intervening, submits, there has been no majority support in this Court for (1997) 189 CLR 520. 56 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 569, 575; see also McCloy v New South Wales (2015) 257 CLR 178 at 214-215 [71]; Clubb v Edwards (2019) 267 CLR 171 at 200 [67]. (2015) 257 CLR 178 at 193-195 [2], 217 [79]. 58 Brown v Tasmania (2017) 261 CLR 328 at 368-369 [123]-[127], 416-417 [278]; Unions NSW v New South Wales (2019) 264 CLR 595 at 615 [42], 638 [110], 653- 656 [161]-[167]; Clubb v Edwards (2019) 267 CLR 171 at 208-209 [96]-[102], 266- 269 [270]-[275], 341-345 [491]-[501]; Comcare v Banerji (2019) 267 CLR 373 at 402-405 [38]-[42], 455-458 [202]-[206]. See also Spence v Queensland (2019) 93 ALJR 643 at 670-671 [93], 671 [97], 719 [324]-[326]; 367 ALR 587 at 613, 614, 59 Palmer v Western Australia (2021) 95 ALJR 229 at 242-243 [52], 284 [264]; 388 ALR 180 at 193, 247. the proposition that there may be a class of laws that under Australian constitutional law automatically attract stricter scrutiny. Although there has been some mention of the "strict scrutiny" doctrine in United States constitutional jurisprudence, it has never been accepted by a majority of this Court as relevant to the implied freedom60. Before turning to address the arguments advanced by the plaintiff in support of its case, we note that the plaintiff did not seek to advance an argument that the Act was invalid as imposing on the plaintiff a form of "prior restraint" upon the exercise by the plaintiff of a right of free speech. In particular in that regard, the plaintiff did not suggest that the Act operated as a regime for the licensing of political communication. That the plaintiff eschewed any such argument is hardly surprising. The Act is not concerned to permit only communications allowed by the government; rather it is concerned to ensure that the identity of the source of such political information as is disseminated on behalf of foreign principals is known to the public and to government decision-makers. The plaintiff's case The plaintiff accepts that the ACU is a foreign principal for the purposes of the FITS Act because it is a foreign corporation that is a foreign political organisation. It acknowledges that the ACU exists primarily to pursue political objectives61. It is agreed that, subject to the question of validity, the plaintiff has registration obligations under the FITS Act because it undertakes registrable activities on behalf of the ACU in the form of holding annual CPAC events which constitute communications activity. It follows that such events involve the communication or distribution of information or material to the public or a section of the public in Australia for the purpose of political or governmental influence. The plaintiff does not contend that the other activities itemised in the table in s 21(1), aside from communications activity, are activities which might not lawfully attract a requirement of registration. It does not contend that s 16 or s 18 ought not apply to lobbying and disbursements. It says that the fact that a measure may be appropriate for those activities does not mean it is appropriate for all. Communications activities should warrant separate treatment because they most clearly involve communications on matters of politics and government, which are the subject of the freedom. 60 Tajjour v New South Wales (2014) 254 CLR 508 at 551 [37], 575 [132]. 61 See the definition of "foreign political organisation" in s 10. There is no dispute that a purpose of the FITS Act is to promote transparency in political discourse by requiring or facilitating disclosure of the relationship between a person and their foreign principal. There is no dispute that such a purpose is a legitimate one in the sense referred to above. Essentially the plaintiff's case is that the requirement of registration cannot be justified because it is not necessary. It is not necessary because s 38 read with the Disclosure Rules requires the disclosure of the relationship between the person and the foreign principal at the time a communication is made. Registration therefore adds nothing to the achievement of the purpose of transparency. The relevant provisions of the FITS Act may be framed so that registration is not required where communications activity is undertaken. A burden on the freedom The defendant concedes that the FITS Act, in its requirement of registration where communications activity is undertaken on behalf of a foreign principal, is effective to burden the freedom. The concession is properly made. Conditioning political communication to a requirement of registration is effective to burden the freedom. That is sufficient to require that the relevant provisions of the FITS Act be justified. Purpose and legitimacy The plaintiff identifies the purpose of the FITS Act as that referred to in s 3, namely to render transparent the fact that activities in the nature of political communication which are carried out by a person in Australia are undertaken on behalf of a foreign principal. The plaintiff submits that it is thereby to be inferred that the concern of the FITS Act is to overcome covert, deceptive or clandestine conduct. Both parties refer in this regard to what was said by the then Prime Minister, in the Second Reading Speech for the National Security Legislation Amendment (Espionage and Foreign Interference) Bill 2017 (Cth), concerning the three Bills then before the Parliament. In that Speech62 the Prime Minister said that the Bills being introduced were shaped by a set of principles one of which was that "foreign influence activities that are in any way covert, coercive or corrupt" would not be 62 Australia, House of Representatives, Parliamentary Debates (Hansard), 7 December 2017 at 13146. tolerated. That, he said, is "the line that separates legitimate influence from unacceptable interference". The Prime Minister went on to say63 that the Counter Foreign Interference Strategy undertaken through the three pieces of legislation has four pillars: sunlight, enforcement, deterrence and capability. Of these, he said, "sunlight is at the very centre". To "ensure activities are exposed to sunlight" a Foreign Influence Transparency Scheme was being introduced. In essence it requires that if "a person or entity engages with the Australian political landscape on behalf of a foreign state or principal then they must register accordingly". This, the Prime Minister said, "will give the Australian public and decision-makers proper visibility when foreign states or individuals may be seeking to influence Australia's political processes and public debates". The requirement of registration is not to be seen as a taint but rather the application of "basic principles of disclosure to allow the public and policymakers to assess any underlying agenda"64. To similar effect, in the Revised Explanatory Memorandum65 it is said that it is essential that there is transparency where communications activity is undertaken on behalf of a foreign principal. This allows the public or a section of the public or a government decision-maker to assess the interests which are being represented by the person undertaking the communications activity. The mischief identified in the Second Reading Speech to which the FITS Act is directed is the risk that foreign states and individuals may seek to influence Australia's political processes and public debates. This implies that the influence sought to be achieved may have adverse effects on processes in our democracy. The Revised Explanatory Memorandum refers, in the context of penalties for enforcement, to the "serious implications that unchecked and unknown forms and sources of foreign influence can have on Australia's democratic system of government"66. An improper influence is most likely to succeed and amount to an interference in those processes if its source remains undisclosed. The purpose of 63 Australia, House of Representatives, Parliamentary Debates (Hansard), 7 December 2017 at 13148. 64 Australia, House of Representatives, Parliamentary Debates (Hansard), 7 December 2017 at 13148. 65 Australia, Senate, Foreign Influence Transparency Scheme Bill 2017, Revised Explanatory Memorandum at 72 [401]. 66 Australia, Senate, Foreign Influence Transparency Scheme Bill 2017, Revised Explanatory Memorandum at 150 [853]. the FITS Act, as the defendant correctly submits, may be understood as being to seek to achieve transparency, in the sense of the exposure of foreign influence, as a means of preventing or minimising the risk that foreign governments or other foreign principals will exert influence on the integrity of Australia's political or electoral processes, as has occurred elsewhere. Long ago this Court recognised the risk that greater influence over electoral processes might be gained by concealment of the source of expressions of view. In Smith v Oldham67, a section of the Commonwealth Electoral Act 1902 (Cth), by which the Commonwealth Parliament sought to regulate the conduct of persons with regard to elections, was unsuccessfully challenged. It required that after the writs for an election or referendum had issued, any articles or reports commenting upon candidates or political parties were to be signed by the author, whose name and address were also to appear in the article or report. Griffith CJ observed that "[i]t is a notorious fact that many persons rely upon others ... in forming their opinions". The weight that they attribute may be greater or less if they know the real authors. He went on to say that "Parliament may, therefore, think that no one should be allowed by concealing his name to exercise a greater influence"68. A requirement of registration in order to protect the processes of a representative government in a democracy is not new69. The importance of that purpose has been recognised by the Foreign Agents Registration Act of 1938 ("the US Act"), which provides that a person must not act as an agent of a foreign principal without filing a registration statement with the Attorney General70. The statement must include details about the registrant, the foreign principal, and agreements between them, and a comprehensive statement of the activities the registrant performs on the foreign principal's behalf, money received from the foreign principal and money spent in connection with those activities. Agents are required to provide supplementary information and to keep records, and are subject to disclosure requirements. The US Act provides for exemptions from registration and for penalties by way of enforcement. The constitutionality of the US Act, in (1912) 15 CLR 355. 68 Smith v Oldham (1912) 15 CLR 355 at 358-359. 69 See also Lobbying Act, RSC 1985, c 44 (4th Supp). 70 22 USC §612. the context there of the right of freedom of expression, has been regarded as well settled71. Even on the plaintiff's somewhat narrower description of purpose, the FITS Act must be understood as one supportive of the processes necessary to our democracy. The Act seeks to ensure that those making decisions in government, those making political judgments, those involved in the election of candidates to the Commonwealth Parliament and other interested persons are aware of the true actors and interests concerned when statements are made or information is provided on political matters. So understood, not only is that purpose legitimate, as consistent with the constitutionally prescribed system of representative government, it serves to protect it72. Such a purpose may be a very important factor in the justification of a law73. It should be noted here that, although the focus of argument in this Court was upon political communication on behalf of a foreign principal directed to the general public, the defendant, rightly, identified a purpose of the Act as being to minimise the risk of undisclosed foreign influence upon the integrity of governmental decision-making. That the Act does indeed pursue such a purpose is clear from the terms of ss 12 and 21 of the Act as well as from the extraneous materials referred to in these reasons. There can be no doubt as to the legitimacy of this purpose, or as to the suitability of the Act as a rational response to the risk so identified. As was said by Brennan J in Australian Capital Television Pty Ltd v The Commonwealth74: "[T]he salutary effect of freedom of political discussion on performance in public office can be neutralized by covert influences". The extent of the burden The defendant correctly submits that whilst the extent of the burden effected by the requirement of registration in connection with communications activity is not relevant to the threshold question as to whether justification is required, it may assume some importance when considering what has to be justified and the 71 Attorney General of United States v Irish People Inc (1982) 684 F 2d 928 at 935. 72 McCloy v New South Wales (2015) 257 CLR 178 at 207-208 [46]-[47]. 73 McCloy v New South Wales (2015) 257 CLR 178 at 218 [84]. (1992) 177 CLR 106 at 159. questions to be addressed in that process. It most clearly assumes relevance to the question whether a law is necessary in order to achieve its purpose and to the question whether it is adequate in its balance, where the burden effected is considered in light of the importance of the purpose sought to be achieved75. It is instructive to observe what political communication is not affected by the relevant provisions of the FITS Act. As the defendant points out, the Act does not place any burden on a person in Australia engaging in political communication on their own behalf, unaffected by any relationship with a foreign principal. To illustrate this point it may be observed that if the plaintiff had not entered into an arrangement with the ACU it could have conducted the CPAC event without incurring an obligation to register. Foreign governments and other foreign principals may also communicate ideas and information to those in the Australian political or governmental sphere or to the Australian public without registering so long as the ideas and information are communicated directly by them. It is only if they are communicated through an intermediary, which has the effect that the source of the ideas or information conveyed is disguised, that registration becomes necessary under the FITS Act. Contrary to the plaintiff's submissions, the FITS Act, in its provisions respecting communications activity, does not operate directly on political communication and is not discriminatory. It does not prohibit political communication and does not seek to regulate its content. The FITS Act is directed to exposing the relationship between the person making the communication and the foreign source. In its written submissions the plaintiff said that the definitions of "on behalf of" and "arrangement" are over-inclusive. This terminology may suggest that the FITS Act has a wide application. The principal factors which would reduce its breadth are the requirements of purpose and intention in ss 12(1) and (2), 21(1) and 14. These matters need not be further explored. The plaintiff does not contend for invalidity on this basis. The point it seeks to make by these observations is that the terms of the FITS Act will be productive of wide coverage, in support of its argument that registration is not necessary. The defendant concedes that conditioning political communication to a requirement of registration effects some burden, but contends that it is modest. The plaintiff likewise submits that the requirement to register alone operates as some disincentive to political communication. It makes the not unimportant point that 75 McCloy v New South Wales (2015) 257 CLR 178 at 218 [84]. registration is required with the government itself. But it goes too far in suggesting that it will have a "chilling effect". The plaintiff describes the process attending registration and its consequences as "onerous" and therefore operating as a deterrent to political communication. It points to the information which must be supplied with an application to register, the fact that the Secretary may require further information, the obligations which accrue from registration, such as updating the information initially provided and the requirement to keep records of communications activity, and the additional obligation to disclose communications activity undertaken. The plaintiff accepts that there are limits to what information the Secretary could lawfully require under s 46. If the Secretary's demands went beyond what is reasonably required for the purpose of the FITS Act it might be expected that challenges in the nature of judicial review might be sought in the courts. For present purposes the point to be made is that the requirement to provide information cannot be regarded as at large. It is difficult to accept that the requirements to take particular steps following registration are likely to be unduly onerous. Several of them are similar to what is required by other legislation. Part XX of the Commonwealth Electoral Act 1918 (Cth)76 requires a Transparency Register to be maintained by the Electoral Commissioner. The Act requires persons such as political campaigners and associated entities to register with the Commissioner and provide certain information and keep that information up to date, in order to support the object of transparency of schemes in the Act relating to donations, electoral expenditure and the authorisation of electoral matter. Prior to 2018, when the provisions for the Transparency Register were introduced, the Commonwealth Electoral Act contained requirements for the registration of political parties and the parties' agents and had done so since at least 199077. It required the provision of some information which is now contained in the Transparency Register. The Lobbying 76 As amended by the Electoral Legislation Amendment (Electoral Funding and Disclosure Reform) Act 2018 (Cth). 77 Registration of political parties was introduced by the Commonwealth Electoral Legislation Amendment Act 1983 (Cth). Registration of party agents was introduced by the Electoral and Referendum Amendment Act 1989 (Cth); a Register of the Commonwealth Electoral Legislation Candidates was established by Amendment Act 1983 (Cth) but was abolished in 1987 by the Commonwealth Electoral Amendment Act 1987 (Cth). of Government Officials Act 2011 (NSW) requires third-party lobbyists to register with the New South Wales Electoral Commission, which publishes the Register on a website maintained by it. Third-party lobbyists are required to keep information updated and their registration can be suspended or cancelled if it is not78. In submitting that the provisions of the FITS Act requiring registration have a deterrent effect on persons who might wish to engage in political communication, the plaintiff's submissions place some weight upon the criminal sanctions which are imposed for breach. True it is that criminal sanctions are imposed for failure to register or renew registration or failure to fulfil the responsibilities of a registrant in order to deter non-compliance. But the offences are not directed to the making of political communication; rather they are directed to ensuring that the exposure of the relationship between the maker and the foreign principal is achieved. The plaintiff takes no issue with the obligation imposed by s 38 to disclose the fact of the relationship between the person communicating information and their foreign principal at the time the disclosure is made. The plaintiff's answer to the question why this obligation is an acceptable burden but that of registration is not is that the disclosure obligation can be discharged easily and involves no ongoing obligations. That is to say the plaintiff's argument respecting the burden effected by registration and the obligations which follow is essentially one of deterrence. It may be accepted that the FITS Act's requirement of registration with respect to communications activity may operate so as to deter some persons from making political communication. But in determining the extent of that burden it must be borne in mind that there will be a very small proportion of persons in Australia who will be in that position. The only communication affected is that made under an arrangement with or at the direction of a foreign principal with the intention that it be used for the purpose of political or governmental influence. The requirement will apply to only a small subset of political communication. Even before one considers the extent of the exemptions provided for in the FITS Act, this leaves most political communication unaffected. Of the limited category of persons who are required to register under the Act, only a small proportion could be expected to be deterred by the requirement of registration. The burden effected is likely to be modest. 78 See also Integrity Act 2009 (Qld); Lobbyists Act 2015 (SA); Integrity (Lobbyists) Act 2016 (WA). It may be observed here that the implied freedom is engaged at all only as an incident, albeit an indispensable incident, of the system of representative government established by the Constitution. It would be distinctly jejune to insist that participation in the public affairs of the nation must not involve a cost to one's privacy or other individual interests79. Proportionality analysis Suitability The test of suitability requires that there be a rational connection between the purpose of the statute in question and the measures adopted by it to achieve that purpose80. This is an enquiry which logic demands81. In this case the purpose of minimising the risk of influence being exerted by foreign principals on Australia's political or election processes is sought to be achieved by measures which seek to make transparent the identity of the foreign principal on whose behalf the person making the communication or providing information intended to influence acts. Clearly, both disclosure by direct means and making publicly available the name of the person and their foreign principal through the process of registration have the requisite connection to the purpose of the FITS Act. In its written submissions the plaintiff correctly stated the test for suitability. But it then contended that there is no rational connection between the purpose of the FITS Act and its situation because the arrangement between it and the ACU was not covert or clandestine; it has always been transparent. This is not a correct approach to the question of suitability. Whilst the facts of a particular case may illuminate aspects of the effect of a statute on the freedom it is necessary to consider the effect on the freedom as a whole in order to determine the question of constitutional invalidity82. The question is not whether the FITS Act can be seen to have application to the plaintiff's circumstances. It is whether there is a rational 79 Comcare v Banerji (2019) 267 CLR 373 at 398 [28], 401-402 [35]-[36]. 80 McCloy v New South Wales (2015) 257 CLR 178 at 209-210 [54]; Brown v Tasmania (2017) 261 CLR 328 at 370 [132]-[133]; Clubb v Edwards (2019) 267 CLR 171 at 205 [84]. 81 McCloy v New South Wales (2015) 257 CLR 178 at 217 [80]; Brown v Tasmania (2017) 261 CLR 328 at 370 [133]. 82 Comcare v Banerji (2019) 267 CLR 373 at 395-396 [20]. connection between the statutory purpose and the requirement of registration. Clearly there is. Necessity This aspect of proportionality analysis involves the enquiry whether there is an alternative measure available which is equally practicable and at the same time is less restrictive of the freedom83 and which is obvious and compelling84. The test of reasonable necessity has consistently been applied in cases involving the implied freedom and in cases concerning the s 92 freedom, where it has been held to be a doctrine of the Court85. The alternatives the plaintiff points to in its submissions include adding to the list of exemptions in Pt 2, Div 4 communications that identify their connection to a foreign principal at the time they are made; or amending the definition of the types of relationships with foreign principals that the FITS Act is legitimately seeking to reveal. In reality these are merely methods of re-drafting the relevant provisions of the FITS Act so as to effect an exclusion of the requirement of registration for communications activity from s 21 in order that ss 16 and 18 do not apply. The crux of the plaintiff's case is that disclosure under s 38 and the Disclosure Rules is sufficient for the purpose of identifying the relationship between a person and their foreign principal and the requirement of registration adds nothing. More commonly an alternative is identified by reference to a provision in another statute or to a measure which could readily be applied to the statutory scheme in question. A difference in the plaintiff's approach to the test of reasonable 83 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 568; Unions NSW v New South Wales (2013) 252 CLR 530 at 556 [44]; McCloy v New South Wales (2015) 257 CLR 178 at 210 [57], 217 [81]; Brown v Tasmania (2017) 261 CLR 328 at 371-372 [139]. 84 Monis v The Queen (2013) 249 CLR 92 at 214 [347]; Tajjour v New South Wales (2014) 254 CLR 508 at 550 [36]; McCloy v New South Wales (2015) 257 CLR 178 at 210-211 [57]-[58]; Brown v Tasmania (2017) 261 CLR 328 at 371-372 [139]; Clubb v Edwards (2019) 267 CLR 171 at 186 [6], 262 [263], 264-265 [266(3)], 265- 266 [267]-[268], 269-270 [277], 337 [478]-[480]; Comcare v Banerji (2019) 267 CLR 373 at 401 [35]. 85 Betfair Pty Ltd v Western Australia (2008) 234 CLR 418 at 477 [103]; Palmer v Western Australia (2021) 95 ALJR 229 at 240 [37], 242 [50]; 388 ALR 180 at 190, necessity from other cases is that the plaintiff points to an existing provision of the statute in question. It submits that nothing more than s 38 is necessary to the scheme of the FITS Act to achieve its purpose. If it is true that registration makes no real contribution to achieving the FITS Act's purpose, there seems no reason in logic why the plaintiff cannot contend that it is not reasonably necessary. Section 38 and the Disclosure Rules cover many methods of communication. They include television and radio broadcasting, social media and printed mediums. In some circumstances the disclosure will be to the public at large and in others it will be only to a small group of persons. The plaintiff's example is of the latter kind. At a conference such as the CPAC event a disclosure will be made by a speaker only to those present unless the speaker's paper is subsequently published more widely. Likewise, where a communication is made on a social media page which is restricted to a small group or in a newspaper in a foreign language, the disclosure will be limited. In circumstances such as these, if what is conveyed by way of political communication is further disseminated by those receiving or reading the communication the disclosure of the relationship between the person making it and their foreign principal may not be more widely published. Information or opinions which might be influential may gain currency within political discourse or public debate without the source of the communication being revealed. This is the very risk which the FITS Act seeks to prevent. Registration enables both the relationship between the person and their foreign principal and a description of the political communication undertaken by the person in that capacity to be matters of public record. It may also be said that, in the nature of things, those persons most interested in, and capable of, subjecting to scrutiny the interests of a foreign participant in the political affairs of this country will be members of the commentariat, such as journalists. The skill and experience of the commentariat, if brought to bear, can ensure effective disclosure of the nature and extent of foreign interests at play in the affairs of this country that might otherwise remain undisclosed or dimly understood. The requirement of registration established by the FITS Act allows the commentariat to be alerted to the presence of foreign influencers in public affairs, and thus enables public debate to be informed in a way that would not be achieved by source disclosure to the recipients of a particular communication at the time of the communication. Both disclosure and registration are necessary for the achievement of the FITS Act's purposes. To the contrary of registration being unnecessary, disclosure under s 38 is not enough. The plaintiff is speaking of a more limited obligation than the FITS Act scheme requires for its purposes. Adequacy in the balance Recently it has been confirmed that a law is to be regarded as adequate in its balance unless the benefit sought to be achieved by the law is manifestly outweighed by the adverse effect on the implied freedom86. In this regard a powerful public, protective purpose assumes a special importance87. The FITS Act clearly has such a purpose. The limited submissions made by the plaintiff on this topic do not deny that the purpose of the FITS Act is protective of Australia's political and electoral processes. That important purpose cannot be said to be outweighed by a burden on the freedom which is modest. Questions not addressed These reasons do not address questions as to whether the Secretary's power to require information from a person, prior to or following registration, extends to information intended to be used for governmental purposes beyond those necessary for the purposes of the FITS Act. They do not address questions of this kind because such questions do not arise from the Amended Special Case for the opinion of this Court. The outer limits of the plaintiff's case, as detailed in these reasons, were confirmed by the plaintiff on more than one occasion during the hearing. The plaintiff at no point sought to expand its case or to amend the Amended Special Case by arguing that the provisions of the FITS Act which permit information to be required constitute overreach, are disproportionate on that account and are therefore invalid. The only point made by the plaintiff concerning the Secretary's power under s 46 was that information-gathering might be onerous. The arguments put by both parties proceeded upon the footing that the Secretary's power is necessarily limited to the purposes of the Act. A case for invalidity premised on questions of the kind referred to above has not been put to the parties for their considered response. During the course of the hearing the Solicitor-General of the Commonwealth was asked whether information might be collected for executive purposes under the Secretary's discretionary powers and not be made public. The Solicitor-General answered to the effect that provisions which enable governmental use of information do not change the purpose for which the information can be gathered. He did not concede 86 Comcare v Banerji (2019) 267 CLR 373 at 402 [38]. 87 McCloy v New South Wales (2015) 257 CLR 178 at 218-219 [86]-[87]; Clubb v Edwards (2019) 267 CLR 171 at 209 [101]-[102]; Comcare v Banerji (2019) 267 CLR 373 at 402-403 [38], 404 [42]. that information might be required other than for the purpose of ensuring the transparency of any relationship between a person and their foreign principal. If such information was provided, the Solicitor-General explained, it would be incidental and it would be of narrow compass. The Solicitor-General was responding to an enquiry. He was not concerned to, and did not, argue a case for the defendant in response to a case that the defendant was required to meet. No such case was advanced against the validity of the Act. For its part, the plaintiff did not pursue the subject of the enquiry. Questions as to the Secretary's powers and the purposes served by these powers are large questions. No basis for these questions is to be found in the Amended Special Case agreed by the parties. It is not contended that information of this kind was sought from the plaintiff for the purposes mentioned. If pressing for answers to such questions could result in invalidity it would be necessary to consider other questions, such as whether the information was relevant to the integrity of governmental decision-making, and, if that question were answered in the negative, further questions would arise, such as whether the application of familiar techniques such as severance, reading down or disapplying the provisions affected might save them from invalidity. None of these matters were adverted to, much less addressed, by the parties. It is certainly not to be supposed that the defendant could not have advanced compelling arguments in relation to these matters. In Lambert v Weichelt88, Dixon CJ explained that "[i]t is not the practice of the Court to investigate and decide constitutional questions unless there exists a state of facts which makes it necessary to decide such a question in order to do justice in the given case and to determine the rights of the parties". This approach has been taken to mean that it is ordinarily inappropriate for the Court to be drawn into a consideration of whether a legislative provision would have an invalid operation in circumstances which have not arisen and which may never arise if the provision, if invalid in that operation, would be severable and otherwise valid89. The same applies where a provision may be read down90. For a constitutional question to be decided by the Court it needs to be shown by the special case "that (1954) 28 ALJ 282 at 283. 89 Knight v Victoria (2017) 261 CLR 306 at 324-325 [32]-[33]. 90 Tajjour v New South Wales (2014) 254 CLR 508 at 587-588 [173], referring to The Commonwealth v Queensland (1987) 62 ALJR 1 at 1-2; Coleman v Power (2004) 220 CLR 1 at 56 [110]. there exists a state of facts which makes it necessary for that question to be decided"91. That condition is not met here. Answers The answers to the questions referred are then as follows: Is the Foreign Influence Transparency Scheme Act 2018 (Cth) invalid, to the extent it imposes registration obligations with respect to communications activities, on the ground that it infringes the implied freedom of political communication? Answer: In light of the answer to question 1, what relief, if any, should issue? Answer: None. Who should pay the costs of and incidental to this special case? Answer: The plaintiff should pay the defendant's costs. 91 Duncan v New South Wales (2015) 255 CLR 388 at 410 [52]. The compulsion to be registered under the Foreign Influence Transparency Scheme Act 2018 (Cth) ("the FITS Act") as a precondition to engaging in political communication with the public or a section of the public on behalf of a foreign principal is in my opinion incompatible with the constitutional freedom of political communication. The incompatibility arises because the scheme of registration established by the FITS Act has incidents which burden political communication by a registrant to a substantially greater extent than is necessary to achieve the sole identified legislative object of improving transparency. the constitutional Repeated elucidation of freedom of political communication in recent cases and thorough exposition of the scheme of registration established by the FITS Act in other reasons for judgment in this case permit me to express my reasoning with minimal elaboration. My reasoning applies the precedent-mandated Lange-Coleman-McCloy-Brown analysis of the compatibility of a law with the constitutional freedom using an analytical approach I have adequately explained in the past92 to the application of the third stage of that analysis, which requires consideration of whether a law burdening freedom of communication in pursuit of a legitimate purpose is reasonably appropriate and adapted to advance that purpose in a manner compatible with the maintenance of the constitutionally prescribed system of government. Analytically important from the start is to be categorical about the nature of the burden that the compulsion to register imposes on political communication. To be forced under pain of criminal sanction to register under a statutory scheme as a precondition to being permitted to engage in a category of political communication at all is to be subjected to a prior restraint on political communication. "A system of prior restraint is in many ways more inhibiting than a system of subsequent punishment: It is likely to bring under government scrutiny a far wider range of expression; it shuts off communication before it takes place"93. "If 92 Tajjour v New South Wales (2014) 254 CLR 508 at 579-581 [148]-[152]; McCloy v New South Wales (2015) 257 CLR 178 at 231-234 [129]-[138], 238-239 [150]- [152]; Brown v Tasmania (2017) 261 CLR 328 at 389-391 [200]-[206]; Clubb v Edwards (2019) 267 CLR 171 at 225 [161]-[162]; Comcare v Banerji (2019) 267 CLR 373 at 408-409 [53]-[54]. 93 Emerson, The System of Freedom of Expression (1970) at 506. it can be said that a threat of criminal or civil sanctions after publication 'chills' speech, prior restraint 'freezes' it at least for the time."94 Prior restraint of political communication was understood in Australia even before representative and responsible government to derogate from an inherited common law freedom which had been recognised in England after the expiration of the licensing laws in 169595 and taken to be established by the time Sir William Blackstone published the fourth volume of his Commentaries on the Laws of England in 176996. The common law freedom was described variously as a "common right", a "constitutional right" and a "constitutional privilege" by Forbes CJ in reasons he gave in 1827 for refusing to certify97 that a legislative proposal by Governor Darling to license newspapers was consistent with the laws of England so far as the circumstances of the colony of New South Wales would then admit98. The lucidity and present-day resonance of those reasons justify them being set out in full. "By the laws of England100, the right of printing and publishing belongs of common right to all His Majesty's subjects, and may be freely exercized 94 Nebraska Press Assn v Stuart (1976) 427 US 539 at 559, citing Bickel, The Morality of Consent (1975) at 61. 95 Emerson, "The Doctrine of Prior Restraint" (1955) 20 Law and Contemporary Problems 648 at 650-651. 96 Blackstone, Commentaries on the Laws of England (1769), bk 4, ch 11 at 151. 97 Under 4 Geo IV, c 96, s 29. 98 See Spigelman, "Foundations of the Freedom of the Press in Australia", in Castle (ed), Speeches of a Chief Justice: James Spigelman 1998-2008 (2008) 373; Campbell, "Colonial Legislation and the Laws of England" (1965) 2 University of Tasmania Law Review 148 at 157-159. 99 Historical Records of Australia, Series I, Volume 13 at 292-294. See also Newspaper Acts Opinion [1827] NSWKR 3. The paragraphing has been added. The emphasis is in the original. The footnoting is also in the original but has been modernised. 100 Bacon, A New Abridgment of the Law, 6th ed (1807), vol 4 at 764-768; Mitchel v Reynolds (1711) 1 P Wms 181 at 183 [24 ER 347 at 348]; The Clothworkers of Ipswich Case (1614) Godbolt 252 at 253 [78 ER 147 at 147-148]. like any other lawful trade or occupation. So far as it becomes an instrument of communicating intelligence and expressing opinion, it is considered a constitutional right, and is now too well established to admit of question that it is one of the privileges of a British subject. The text is comprehensively laid down by Mr Justice Blackstone as follows: – 'The liberty of the press consists in laying no previous restraint upon publications, and not in freedom from censure for criminal matter when published. Every free man has an undoubted right to lay what sentiments he pleases before the public – to forbid this is to destroy the freedom of the press.' To subject the press to the restrictive power of a licenser, as was formerly done, both before and since the revolution, is to subject all freedom of sentiment to the prejudices of one man, and to make him the arbitrary and infallible judge of all controverted points in learning, religion and government101. In affirmance of this doctrine, the late Lord Ellenborough is reported, in a celebrated case of libel, to have delivered himself in these words – 'The law of England is a law of liberty, and, consistently with this liberty, we have not what is called an imprimatur, there is no such preliminary license necessary.'102 In a recent work, of which the great lawyer, whom I have just cited, was pleased to express his approbation, the principle of the law is stated in the following terms: – 'There is nothing upon which Englishmen are justly more sensible than upon whatever has the appearance of affecting the liberty of the press. But popular writers have certainly extended the notion of this liberty beyond what in reason it will bear. They have converted it into a native, an original, a primitive right, instead of considering it only as a right derivative and deductive from the joint rights of opinion and of speaking. This, including an exemption from the control of a licenser, and all previous restraint upon the mere suspicion of abuse, is the proper notion of the liberty of the press.'103 It were unnecessary to multiply authorities; it is clear that the freedom of the press is a constitutional right of the subject, and that this freedom essentially consists in an entire exemption from previous restraint; all the statutes in force are in accordance with this first principle of law; they facilitate the means of proof; in certain cases, they encrease the measure of punishment; but in no instance do they impose any previous restraint either 101 Blackstone, Commentaries on the Laws of England (1769), bk 4, ch 11 at 151. 102 Trial of William Cobbett (1804) 29 St Tr 1 at 49. 103 Holt, The Law of Libel, 2nd ed (1816) at 59-60. upon the matter of publication or the person of the publisher. Indeed to admit the power of selection among publishers would be more repugnant to the spirit of the law than to impose a direct imprimatur; it would be not merely to confine the right of publishing within partial bounds, but it would be to establish a monopoly in favor of particular principles and opinions, to destroy the press as the privilege of the subject, and to preserve it only as an instrument of government. 'The press', continues Blackstone, 'can never be used to any good purpose, when under the control of an inspector.' By the laws of England, then, every free man has the right of using the common trade of printing and publishing newspapers; by the proposed bill, this right is confined to such persons only as the Governor may deem proper. By the laws of England, the liberty of the press is regarded as a constitutional privilege, which liberty consists in exemption from previous restraint; by the proposed bill, a preliminary license is required, which is to destroy the freedom of the press, and to place it at the discretion of the government." Forbes CJ had earlier explained in official correspondence that the freedom of political communication that existed at common law even in a penal colony was such that a prior restraint on publication "requires to be carefully examined". "[I]f you take away the freedom of public opinion upon matters of government", he wrote, "you take away a legal right; necessity you will say justifies it; then the limit of that justification is the necessity which compels it; it should go no further"104. The constitutionally entrenched freedom of political communication which came to be recognised 165 years later in Australian Capital Television Pty Ltd v The Commonwealth105 and Nationwide News Pty Ltd v Wills106 to derive from the national system of representative and responsible government established by the Constitution is a systemic structural imperative as distinct from an individual right or privilege. That difference from the common law freedom of political communication expounded by Forbes CJ acknowledged, application of the Lange- Coleman-McCloy-Brown analysis to a prior restraint on political communication requires no lesser intensity of scrutiny and demands no lesser standard of justification than that identified by Forbes CJ. To be compatible with freedom of political communication, a prior restraint on political communication must withstand what the constitutional 104 Historical Records of Australia, Series IV, Section A, Volume 1 at 682. 105 (1992) 177 CLR 106. 106 (1992) 177 CLR 1. Gleeson CJ referred to in Mulholland v Australian Electoral Commission107 as "close scrutiny, congruent with a search for 'compelling justification'". To meet that standard of compelling justification, the restraint must satisfy two conditions. The restraint must be imposed in pursuit of an object that is not only consistent with the constitutionally prescribed system of representative and responsible government but also compelling. And the restraint must be narrowly tailored to achieve that object in a manner that minimally impairs freedom of political communication. That is to say, the burden on political communication imposed by the restraint must not be substantially greater than is reasonably necessary to achieve the purpose. The scheme of registration established by the FITS Act satisfies the first of those conditions. It does not satisfy the second. The object of the scheme of registration established by the FITS Act is limited to that identified in the FITS Act. The sole object of the scheme of registration there identified is to "improve the transparency" of activities undertaken on behalf of foreign principals108. As explained to the House of Representatives by the Attorney-General, the object is to enable "the public and decision-makers in government [to] have access to information to enable them to accurately assess how foreign sources may be seeking to influence Australia's government and political processes"109. Neither the FITS Act nor anything appearing in the record of the extensive process of parliamentary deliberation which preceded its enactment indicates that any part of the object of the scheme of registration is to assist in monitoring or enforcing compliance with measures introduced by the contemporaneously enacted Electoral Legislation Amendment (Electoral Funding and Disclosure Reform) Act 2018 (Cth) or National Security Legislation Amendment (Espionage and Foreign Interference) Act 2018 (Cth) or any other Commonwealth, State or Territory legislation. The Solicitor-General of the Commonwealth was careful to eschew any argument that the object of the scheme of registration established by the FITS Act has any additional element of that nature. Of "the four pillars of sunlight, enforcement, deterrence and capability" identified by the Prime Minister as underpinning the "counter-foreign-interference 107 (2004) 220 CLR 181 at 200 [40]. 108 Section 3 of the FITS Act. 109 Australia, House of Representatives, Parliamentary Debates (Hansard), 26 June 2018 at 6399. See also Australia, Senate, Foreign Influence Transparency Scheme Bill 2017, Revised Explanatory Memorandum at [1]-[5]. strategy" implemented by the package of legislation of which the FITS Act formed part110, the FITS Act is therefore concerned exclusively with "sunlight". Use of that metaphor derives from an essay written by Louis D Brandeis in 1913 entitled "What Publicity Can Do". Brandeis commenced the essay111: "Publicity is justly commended as a remedy for social and industrial diseases. Sunlight is said to be the best of disinfectants; electric light the most efficient policeman." Brandeis' additional metaphor of "electric light" was adapted by the Committee on the Judiciary of the House of Representatives of the United States in explaining the design of the forerunner to the FITS Act, the Foreign Agents Registration Act 1938 (US), as being to let "the spotlight of pitiless publicity ... serve as a deterrent to the spread of pernicious propaganda"112. Pursuit of the sole identified object of improving transparency of activities undertaken on behalf of foreign principals by narrowly tailored means undoubtedly justifies creation of a system of registration under which a person wishing to engage in political communication with the public or a section of the public on behalf of a foreign principal must first disclose on a public register information relevant to enabling the public to appraise the political communication in light of the relationship between the person and the foreign principal. Undoubtedly, it justifies requiring a registrant to provide information of that character to the Secretary of the Attorney-General's Department in order for that information to be made available to the public on a website to be established and maintained by the Secretary. The system of registration established by the Foreign Agents Registration Act, under which registrants are required to furnish to the Attorney General of the United States registration statements which become public records open to public examination and available to the public over the Internet, is a longstanding legislative precedent. What pursuit of that sole identified object of improving the transparency of activities undertaken on behalf of foreign principals by narrowly tailored means 110 Australia, House of Representatives, Parliamentary Debates (Hansard), 7 December 2017 at 13146. 111 Brandeis, "What Publicity Can Do", Harper's Weekly, 20 December 1913 at 10. See also Brandeis, Other People's Money and How the Bankers Use It, new ed (1932) at 112 HR Rep No 1381, 75th Cong, 1st Sess (1937) at 2. does not justify is creation of a system of registration under which a person who wishes to engage in political communication with the public or a section of the public on behalf of a foreign principal must first provide to the Secretary of the Attorney-General's Department any information that the Secretary in his or her discretion requires113, all of which is to be kept on a register established and maintained by the Secretary114, only some of which is to be made available to the public on a website to be established and maintained by the Secretary115, but all of which is to be available to be shared at the discretion of the Secretary with any "enforcement body"116 for the purpose of any "enforcement related activity"117 within the meaning of the Privacy Act 1988 (Cth)118; with any Department, agency or authority of the Commonwealth, a State or a Territory or any Australian police force for the purpose of protecting public revenue119 or for the purpose of 113 Section 16(2)(d), s 34(1) and (3)(d), and s 39(2)(d) of the FITS Act. 114 Section 42 of the FITS Act. 115 Section 43 of the FITS Act. 116 Including the Australian Federal Police or the police force of a State or Territory, the Integrity Commissioner, the Office of the Director of Public Prosecutions or similar body established under a State or Territory law, the Australian Crime Commission, the Immigration Department, the Australian Prudential Regulation Authority, the Australian Securities and Investments Commission, the New South Wales Crime Commission, the Independent Commission Against Corruption of New South Wales, the Law Enforcement Conduct Commission of New South Wales, the Independent Broad-based Anti-corruption Commission of Victoria, the Crime and Corruption Commission of Queensland, the Corruption and Crime Commission of Western Australia, the Independent Commissioner Against Corruption of South Australia, and any other Commonwealth agency or State or Territory authority "to the extent that it is responsible for administering, or performing a function under, a law that imposes a penalty or sanction". See the definition of "enforcement body" in s 6(1) of the Privacy Act 1988 (Cth). 117 Including "the prevention, detection, investigation, prosecution or punishment of ... criminal offences ... or ... breaches of a law imposing a penalty or sanction", or "the conduct of surveillance activities, intelligence gathering activities or monitoring activities", or "the prevention, detection, investigation or remedying of misconduct of a serious nature". See the definition of "enforcement related activity" in s 6(1) of the Privacy Act 1988 (Cth). 118 Item 1 of the table in s 53(1) of the FITS Act. 119 Item 2 of the table in s 53(1) of the FITS Act. protecting "security"120 within the meaning of the Australian Security Intelligence Organisation Act 1979 (Cth)121; or with any other person who might be prescribed in a legislative instrument made by the Attorney-General under the FITS Act for any other purpose that might be prescribed by that instrument122. Subjection of a registrant to the requirement to provide that broader category of information as an incident of registration is itself a burden on the political communication in respect of which registration is required. The burden lies in the registrant being unable to engage in the political communication at all without the registrant needing first to submit to a requirement to divulge privately held information that is then available to be used for governmental purposes adverse to the interests of the registrant and those with whom the registrant is politically affiliated. Important to recognise in that respect is that information about a registrant not publicly accessible would otherwise be obtainable by the Commonwealth, State and Territory agencies and authorities with whom the Secretary is empowered to share it under the scheme only through the exercise of covert or coercive powers conferred by other Commonwealth, State or Territory laws. Asked in the course of argument to explain that added burden on political communication arising as an incident of registration, the Solicitor-General sought to minimise its significance by arguing that the discretions conferred on the Secretary are confined by reference to the stated object of the FITS Act. The discretion to require information from a registrant to be included on the register, he argued, is to be exercised for the sole purpose of promoting transparency through publication of information from the register on the website. The discretion to share information from the register with the numerous Commonwealth, State and Territory agencies and authorities with whom the Secretary is empowered to share it, he argued, is to be exercised only for the purpose of sharing information of interest to those agencies and authorities that might be captured incidentally in 120 Including the protection of the Commonwealth, the States and Territories and their people from "clandestine or deceptive" activities carried on for the purpose of affecting political or governmental processes relating to Australia undertaken in active collaboration with a foreign government, an entity directed or controlled by a foreign government or a foreign political organisation. See the definitions of "security", "acts of foreign interference" and "foreign power" in s 4 of the Australian Security Intelligence Organisation Act 1979 (Cth). 121 Item 3 of the table in s 53(1) of the FITS Act. 122 Item 4 of the table in s 53(1) of the FITS Act. the process of gathering information for the sole purpose of promoting transparency by means of the publication of information on the website. The submission overstated the extent to which applicable principles of statutory interpretation confine the discretions by reference to the stated object of the FITS Act. The discretions are conferred on the Secretary against the background of the principle that "[a] statute which confers a power to obtain information for a purpose defines, expressly or impliedly, the purpose for which the information when obtained can be used or disclosed" with the result that "[t]he statute imposes on the person who obtains information in exercise of the power a duty not to disclose the information obtained except for that purpose"123. The statutory purposes for which information included on the register can be disclosed in the discretion of the Secretary serve to indicate the statutory purposes for which information can be obtained in the discretion of the Secretary for inclusion on the register. Moreover, the discretions are in terms unconfined. That being so, "the factors that may be taken into account in [their] exercise ... are similarly unconfined, except in so far as there may be found in the subject-matter, scope and purpose of the statute some implied limitation on the factors to which the decision- maker may legitimately have regard"124. The factors to which the Secretary can have regard in exercising the discretions cannot be confined by reference to the statutory object of the scheme of registration identified in the FITS Act to the exclusion of reference to the structure of the scheme of registration of which the discretions form part. the limitation of Notwithstanding improvement of transparency, no part of the design of the scheme of registration established by the FITS Act is to confine collection of information from registrants to that to be made publicly available on the website. The discretion to require information from registrants for inclusion on the register is rather designed to facilitate each of the its object 123 Johns v Australian Securities Commission (1993) 178 CLR 408 at 424; Katsuno v The Queen (1999) 199 CLR 40 at 57 [24]. 124 Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 at 40, citing R v Australian Broadcasting Tribunal; Ex parte 2HD Pty Ltd (1979) 144 CLR 45 at 49-50, adopting earlier formulations in Swan Hill Corporation v Bradbury (1937) 56 CLR 746 at 757-758 and Water Conservation and Irrigation Commission (NSW) v Browning (1947) 74 CLR 492 at 505. forms of use and disclosure of information included on the register for which the FITS Act provides. Publication of information on the website is just one of them. The architecture of the scheme in that respect is mapped out in the simplified outline of the FITS Act in the statement that "[c]ertain information about registrants and their activities is made publicly available"125. The architecture of the scheme is then detailed in the simplified outline of the Part which governs "[o]btaining and handling scheme information" in statements that "[s]ome scheme information will be made publicly available" and that "[o]ther scheme information must be handled in accordance with [identified provisions specifically including those which authorise the Secretary to share information from the register with the numerous Commonwealth, State and Territory agencies and authorities with whom the Secretary has discretion to share it]"126. Moving beyond the simplified outlines to the detail of the operative provisions, there is a marked contrast between the unconfined discretion of the Secretary to require information from registrants and the precisely defined obligation of the Secretary to publish a subset of that information on the website. Apart from the name of the registrant and the foreign principal and a description of the kind of registrable activities the registrant undertakes on behalf of the foreign principal, the information to be published on the website is limited to that prescribed by legislative instrument made by the Attorney-General127. Publication of the whole of the prescribed information is mandatory subject only to exceptions for information that the Secretary is satisfied is commercially sensitive, affects national security or is excepted by legislative instrument made by the Attorney- General128. The contrast between the precisely defined obligation of the Secretary to publish a subset of the information from the register on the website and the discretions of the Secretary both to collect information from registrants to be included on the register and to share information from the register with Commonwealth, State and Territory agencies and authorities highlights that the fundamental problem with the scheme is not that the discretions to collect and share information are overbroad but that they exist at all. The problem that arises from the existence of the discretions is not one that might or might not occur in the administration of the scheme, consideration of which can be deferred until if and 125 Section 4 of the FITS Act (emphasis added). 126 Section 41 of the FITS Act (emphasis added). 127 Section 43(1) of the FITS Act. 128 Section 43(2) of the FITS Act. when it does arise129. The problem is inherent in the structure of the scheme to which every registrant is immediately subjected: to attempt to remove the problem by reading down the scope of the discretions so as to minimise the disconnect between the information on the secret register and the information on the publicly accessible website would be to engage in the legislative process of designing a new scheme130. Put bluntly, the scheme of registration established by the FITS Act is not fit for purpose. A scheme of registration narrowly tailored to improve transparency of political communication undertaken on behalf of foreign principals with the public or sections of the public in a manner that minimally impaired freedom of political communication would have no place for a secret register at all. The information to be required from registrants and the information to be made available to the public would be one and the same and would be defined by legislative prescription. There would be no occasion for the discretionary collection and discretionary dissemination of information for other governmental purposes. By subjecting a registrant to the requirement to provide information to be included on a secret register to be available to be shared with Commonwealth, State and Territory agencies and authorities, the scheme of registration established by the FITS Act burdens political communication by a registrant with the public or a section of the public to a substantially greater extent than is necessary to achieve the sole identified legislative object of improving the transparency of that communication. For that reason, the compulsion to be registered under the scheme in order to engage in political communication with the public or a section of the public on behalf of a foreign principal is not compatible with the constitutional freedom of political communication. Doing my best to express that incompatibility in the language of structured proportionality, I would not shrink from saying that the scheme of registration established by the FITS Act is not "suitable"131 for the reason that there is no rational connection between the object of improving transparency and the subjection of a registrant to the requirement to provide information to be included on the register that is not to be published but that is to be available to be shared with Commonwealth, State and Territory agencies and authorities. If that is too 129 Knight v Victoria (2017) 261 CLR 306 at 324-325 [32]-[33], applying Lambert v Weichelt (1954) 28 ALJ 282 at 283. 130 cf Spence v Queensland (2019) 93 ALJR 643 at 669-670 [85]-[91]; 367 ALR 587 at 131 cf Comcare v Banerji (2019) 267 CLR 373 at 400 [33]. strong, I would still say that the scheme is not "necessary"132 for the reason that an obvious and compelling reasonably practicable alternative means of achieving the object of improving transparency is not to subject a registrant to that requirement at all. At the very least, I would say that the scheme is not "adequate in its balance"133 for the reason that the burden it places on political communication by subjecting a registrant to that requirement contributes nothing to the achievement of the benefit of improved transparency sought to be achieved. The conclusion that the compulsion to be registered under the scheme of registration established by the FITS Act is incompatible with the constitutional freedom of political communication in its application to a person who seeks to engage in political communication with the public or a section of the public on behalf of a foreign principal does not necessarily entail the conclusion that the compulsion to be registered is incompatible with the constitutional freedom in its application to a person who seeks to engage on behalf of a foreign principal in other registrable activities within the scope of the scheme. There is a difference between a requirement to register as a precondition to engaging in political communication with the public or a section of the public and a requirement to register as a precondition to representing the interests of another in dealings with legislative and executive arms of government134. Conformably with the implied freedom's centrally informing concern to protect the integrity of the processes of representative and responsible government, the permissible incidents of a scheme of registration directed in dealing with government135 can be expected to be more burdensome in practice than the permissible incidents of a scheme of registration directed to persons engaging in political communication with the public. to persons representing others My formal answers to the questions reserved by the special case are as follows. (1) In their application to a person who undertakes, or arranges to undertake, on behalf of a foreign principal an activity made registrable by Item 3 of the table in s 21(1), ss 16 and 18 of the FITS Act infringe the implied freedom of political communication and are for that reason invalid. (2) The plaintiff should have a declaration to that effect. (3) The defendant should pay the costs of and incidental to the special case. 132 cf Comcare v Banerji (2019) 267 CLR 373 at 401 [35]. 133 cf Comcare v Banerji (2019) 267 CLR 373 at 402 [38]. 134 cf Thomas v Collins (1945) 323 US 516 at 544-545; United States v Harriss (1954) 347 US 612 at 625-626, 636. 135 eg Pt 2A of the Migration Act 1958 (Cth), considered in Cunliffe v The Commonwealth (1994) 182 CLR 272. 122 GORDON J. The Foreign Influence Transparency Scheme Act 2018 (Cth) ("the FITS Act") was one of three measures136 enacted by the Federal Parliament as part of a "Counter Foreign Interference Strategy" which was "built upon the four pillars of sunlight, enforcement, deterrence and capability"137. "Sunlight" was said to be at the "very centre" of that strategy138. The FITS Act was introduced to provide for "a scheme for the registration of persons who undertake certain activities on behalf of foreign governments and other foreign principals, in order to improve the transparency of their activities on behalf of those foreign principals"139 to ensure such activities are "exposed to sunlight"140. The plaintiff, LibertyWorks Inc, is "a private think-tank with an aim to move public policy in the direction of increased individual rights and freedoms, including the promotion of freedom of speech and political communication". Subject to validity, the parties agree that LibertyWorks is required to register under the FITS Act because it is a person who engages in a "registrable activity": namely, it undertakes, on behalf of a foreign principal (the American Conservative Union ("the ACU"), which is a foreign political organisation because it is a foreign organisation objectives), communications activity in Australia for the purpose of political or governmental influence141. The registrable activity is holding annual Conservative Political Action Conference ("CPAC") events in Australia. LibertyWorks relevantly organised and co-hosted the 2019 CPAC event under an arrangement with the ACU or otherwise entered into a registrable arrangement with the ACU. primarily political pursue exists that 136 The other measures were the Electoral Legislation Amendment (Electoral Funding and Disclosure Reform) Act 2018 (Cth) and the National Security Legislation Amendment (Espionage and Foreign Interference) Act 2018 (Cth). 137 Australia, House of Representatives, Parliamentary Debates (Hansard), 7 December 2017 at 13146. 138 Australia, House of Representatives, Parliamentary Debates (Hansard), 7 December 2017 at 13148. 139 FITS Act, s 3. 140 Australia, House of Representatives, Parliamentary Debates (Hansard), 7 December 2017 at 13148. 141 FITS Act, s 21(1), table item 3. the extent imposes registration obligations with respect LibertyWorks challenges the validity of specific provisions142 of the FITS Act as infringing the implied freedom of political communication in their application to "communications activity", which is just one of the "registrable activities" under the FITS Act143 ("the impugned provisions"). LibertyWorks does not challenge the application of the impugned provisions to any of the other "registrable activities"144. The relief sought by LibertyWorks in its Further Amended Statement of Claim and the question of law stated for the opinion of the Full Court each reveal that LibertyWorks' challenge is to the validity of the FITS Act "communications activity". LibertyWorks identified the aspects of the FITS Act – the impugned provisions – which it contends are invalid. It identified the "targets" of its challenge as ss 16 and 18 (the requirement to register), in their operation in respect of s 21(1), table item 3. In that way, LibertyWorks confined its challenge to the operation of the FITS Act with respect to registrable "communications activity" (except for s 38), and not the other kinds of "registrable activities". LibertyWorks, however, was not simply concerned with the requirement to "register", but with the things that "registration brings with it", including ongoing record-keeping obligations, obligations to provide information and documents to the government and the criminal consequences for non-compliance. The deterrent effects of an obligation to register with respect to "communications activity" cannot be understood without reference to the aspects of the scheme to which registrants and persons liable to register are made subject by the FITS Act. As with any question of constitutional validity, the first step must always be to construe the Act and determine its legal effect and practical operation145. 142 FITS Act, ss 16, 18, 21(1), table item 3, 37, 39, 57-59. As these reasons will explain, LibertyWorks' challenge to certain definitions in ss 10, 11, 12, 13, 13A and 14 fails as the definitions have no operative effect absent other provisions. 143 See FITS Act, Pt 2, Div 3. 144 The other registrable activities include "parliamentary lobbying on behalf of [a] foreign government" and "[p]arliamentary lobbying", "[g]eneral political lobbying" and "[d]isbursement activity" for the purpose of political or governmental influence: FITS Act, ss 20, 21(1), table items 1, 2 and 4. 145 Fairfax v Federal Commissioner of Taxation (1965) 114 CLR 1 at 7; Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476 at 498-499 [53]; Coleman v Power (2004) 220 CLR 1 at 21 [3], 68 [158]; Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532 at 553 [11]; North Australian Aboriginal Justice Agency Ltd v Northern Territory (2015) 256 CLR 569 at 581 [11]; Brown v Tasmania (2017) 261 CLR 328 at 428 [307], 433-434 It is necessary to begin with the proper construction and application of the impugned provisions within the scheme and framework of the FITS Act146. "[T]he impugned provisions cannot be read in isolation"147 and the Court is not confined to choosing between competing constructions advanced by the parties148. Determining the legal effect and practical operation of the FITS Act in its application to LibertyWorks is not to "roam at large"149. LibertyWorks does not seek to challenge the operation of provisions of the FITS Act "in circumstances which have not arisen and may never arise"150. The impugned provisions in their application to "communications activity" are intended to, and do, regulate political communications of the broadest kind between members of the public and with political representatives. The impugned provisions place a significant burden on political communications, which requires a compelling justification. The purpose of the FITS Act identified by the Commonwealth – to minimise the risk of foreign principals exerting undisclosed influence upon the integrity of Australia's political or election processes – is legitimate. No other or wider purpose was said to be pursued. Where, "undertakes" a "communications activity" on behalf of a "foreign principal", such as a foreign political organisation, for the purpose of "political or governmental influence", like LibertyWorks, a person, however, 146 Comcare v Banerji (2019) 267 CLR 373 at 434 [136], [138]. 147 Banerji (2019) 267 CLR 373 at 434 [138]. See also Attorney-General (Cth) v Schmidt (1961) 105 CLR 361 at 376; Gerhardy v Brown (1985) 159 CLR 70 at 103; Wainohu v New South Wales (2011) 243 CLR 181 at 220 [70]; Murphy v Electoral Commissioner (2016) 261 CLR 28 at 128 [321], 129 [328]. 148 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 366 [13]; Australian Communication Exchange Ltd v Deputy Commissioner of Taxation (2003) 77 ALJR 1806 at 1808 [7], 1815 [51]; 201 ALR 271 at 274, 283; Coleman (2004) 220 CLR 1 at 93-94 [243]. See also Autodesk Inc v Dyason [No 2] (1993) 176 CLR 300 at 308. 149 Knight v Victoria (2017) 261 CLR 306 at 324-325 [33], quoting Real Estate Institute of NSW v Blair (1946) 73 CLR 213 at 227. See also Pape v Federal Commissioner of Taxation (2009) 238 CLR 1 at 69 [156]-[158]. 150 Knight (2017) 261 CLR 306 at 324-325 [32]-[33], applying Lambert v Weichelt (1954) 28 ALJ 282 at 283. See also Clubb v Edwards (2019) 267 CLR 171 the impugned provisions are not tailored to the identified purpose of the FITS Act and are not justified. As will be seen, the FITS Act contemplates that the Secretary of the Attorney-General's Department ("the Secretary") will gather, in a range of ways151, an extensive amount of "scheme information"152 that relates to persons who may be liable to register and registrants or that is more broadly relevant to the operation of the scheme. The overreach of the impugned provisions is best illustrated by the fact that the FITS Act creates two repositories of that "scheme information": one is a "register" kept by the Secretary, which is not made public153; the other is a publicly accessible website154. What is not made public cannot "improve the transparency"155 of activities on behalf of a foreign principal. The gap between the two repositories is not justified and cannot be bridged. It was not suggested that the disconformity between the register and the public website could be solved by severing the information gathering provisions which yield the register. The gap is not bridged by significantly reading down the information gathering provisions. They are not provisions that can be given some limited distributive operation156. Any reading down which would be necessary is to the point that the information gathered would only be of a kind that would appear on the public website. That is not what the FITS Act says or does157. The FITS Act enables the Secretary to obtain information which is stored on a register and not made public, but which may relevantly be provided by the Secretary to law enforcement bodies158. That is, as LibertyWorks submitted, a significant deterrent. And a non-public register does nothing to minimise the risk of undisclosed influence. It does the opposite. A non-public register is in darkness, not sunlight. 151 See, eg, FITS Act, ss 16(2)(d), 34-37, 39(2)(d), 45-46. 152 FITS Act, s 50. 153 FITS Act, s 42. 154 FITS Act, s 43. 155 FITS Act, s 3. 156 cf Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 61. 157 cf Pidoto v Victoria (1943) 68 CLR 87 at 111; Bank of NSW v The Commonwealth (1948) 76 CLR 1 at 152, 164, 372; Spence v Queensland (2019) 93 ALJR 643 at 669-670 [87]-[90]; 367 ALR 587 at 612-613. 158 See, eg, FITS Act, s 53. As LibertyWorks submitted, the acquisition of information that is not made public does "nothing for ... the sunshine purpose of the [FITS Act]". The public website, with its prescribed contents, on the other hand is directed at the identified legitimate purpose of minimising the risk of foreign principals exerting undisclosed influence upon the integrity of Australia's political or election processes and is justified. It discloses the fact of the influence, how the influence is effected and by whom and through whom. The gathering of other scheme information and storing of it on a non-public register does not. Implied freedom of political communication Sections 7, 24 and 128 of the Constitution (with Ch II, including ss 62 and 64) create a system of representative and responsible government. The implied freedom of political communication is "an indispensable incident of the system of representative and responsible government ... because that system requires that electors be able to exercise a free and informed choice when choosing their representatives, and, for them to be able to do so, there must be a free flow of political communication within the federation"159 (emphasis added). There is no doubt that the implied freedom protects political communication to influence others to a political viewpoint"160 "undertaken legitimately (emphasis added). This includes communications between elected representatives and electors, and "between all persons, groups and other bodies in the community"161. As Mason CJ has explained162: "That is because individual judgment, whether that of the elector, the representative or the candidate, on so many issues turns upon free public discussion … of the views of all interested persons, groups and bodies and on public participation in, and access to, that discussion. In truth, 159 Brown (2017) 261 CLR 328 at 430 [312]. See also Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 138-139 ("ACTV"); Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 557-562; Unions NSW v New South Wales (2013) 252 CLR 530 at 551 [27]-[28], 571 [104]-[109] ("Unions No 1"). 160 Unions No 1 (2013) 252 CLR 530 at 551 [30]. 161 ACTV (1992) 177 CLR 106 at 139. See also Unions No 1 (2013) 252 CLR 530 at 551-552 [28]-[30]; Tajjour v New South Wales (2014) 254 CLR 508 at 577 [140]; Brown (2017) 261 CLR 328 at 430 [312]. 162 ACTV (1992) 177 CLR 106 at 139 (footnote omitted). in a representative democracy, public participation in political discussion is a central element of the political process." Moreover, the range of "communications" protected by the implied freedom is broad163. The freedom protects discussion of matters that "might bear on the choice that the people have to make in federal elections or in voting to amend the Constitution, and on their evaluation of the performance of federal Ministers and their departments"164 (emphasis added). This includes communications "made to the public on a government or political matter"165 and communications "in relation to public affairs and political discussion"166. It encompasses communications "on the wide range of matters that may call for, or are relevant to, political action actions", and communications which "seek to bring about change" or "call for action where none has been taken and in this way influence the elected representatives"167. "government decision", decisions criticism and Whether the impugned provisions are invalid for impermissibly burdening the implied freedom falls to be assessed by reference to the following questions168: (1) Do the impugned provisions effectively burden the freedom of political communication? (2) Is the purpose of the FITS Act legitimate, in the sense that it is consistent with the maintenance of the constitutionally prescribed system of government? (3) Are the impugned provisions reasonably appropriate and adapted to advance that legitimate purpose in a manner consistent with the maintenance of the constitutionally prescribed system of government? 163 Hogan v Hinch (2011) 243 CLR 506 at 544 [49]. 164 Lange (1997) 189 CLR 520 at 571; see also 561. See also Tajjour (2014) 254 CLR 165 Lange (1997) 189 CLR 520 at 571. 166 ACTV (1992) 177 CLR 106 at 138. 167 ACTV (1992) 177 CLR 106 at 138. 168 See test identified in Lange (1997) 189 CLR 520 at 561-562, 567-568, as modified and refined in Coleman (2004) 220 CLR 1 at 51 [95]-[96], 77-78 [196], 82 [211], McCloy v New South Wales (2015) 257 CLR 178 at 193-195 [2] and Brown (2017) 261 CLR 328 at 363-364 [104], 375-376 [155]-[156], 398 [236], 413 [271], The FITS Act The question whether a statute burdens the implied freedom is answered by reference to the terms, legal effect and practical operation of the statute169. It is not answered by deciding whether a statute "limits the freedom on the facts of a particular case"170; the focus is on the effect on the implied freedom "generally"171. A statute will "effectively burden" the implied freedom if "the effect of the law is to prohibit, or put some limitation on, the making or the content of political communications"172. The level of justification required depends on the nature and extent of the burden imposed173. In the present case, the nature and extent of the burden, not whether the impugned provisions burdened the implied freedom, was in issue. In order to explain the nature and extent of the burden it is necessary to give detailed consideration to the relevant provisions of the FITS Act. Registrable activities and registration As has been noted, the FITS Act provides for "a scheme for the registration of persons who undertake certain [registrable] activities on behalf of foreign 169 Lange (1997) 189 CLR 520 at 567; Unions No 1 (2013) 252 CLR 530 at 553 [35]; Brown (2017) 261 CLR 328 at 353 [61], 382 [180]. 170 Clubb (2019) 267 CLR 171 at 192-193 [35]. See also Wotton v Queensland (2012) 246 CLR 1 at 31 [80]; Unions No 1 (2013) 252 CLR 530 at 554 [36], 586 [166]; Brown (2017) 261 CLR 328 at 360 [90]. 171 Wotton (2012) 246 CLR 1 at 30 [78], 31 [80]; Unions No 1 (2013) 252 CLR 530 at 553-554 [35]-[36]; Brown (2017) 261 CLR 328 at 360 [90], 398 [237]; Clubb (2019) 267 CLR 171 at 301 [377]. 172 Monis v The Queen (2013) 249 CLR 92 at 142 [108]. See also Unions No 1 (2013) 252 CLR 530 at 574 [119]; McCloy (2015) 257 CLR 178 at 230-231 [126]; Brown (2017) 261 CLR 328 at 382-383 [180], 455 [395]; Clubb (2019) 267 CLR 173 Monis (2013) 249 CLR 92 at 146 [124]; Tajjour (2014) 254 CLR 508 at 580 [151]; McCloy (2015) 257 CLR 178 at 238-239 [150]-[152], 259 [222], 269-270 [255]; Brown (2017) 261 CLR 328 at 367 [118], 369 [128], 378-379 [164]-[165], 389-390 [200]-[201], 423 [291], 460 [411], 477-478 [478]; Clubb (2019) 267 CLR 171 governments and other foreign principals, in order to improve the transparency of their activities on behalf of those foreign principals"174 (emphasis added). Broadly, the "scheme"175 comprises distinct but interconnected mechanisms: a requirement for persons to register when engaged in one of the "registrable activities"176; a "register" of information obtained in relation to the scheme maintained by the Secretary that is not publicly available177 and a separate publicly accessible website containing specified information about registrants178; disclosure obligations in respect of registrable communications activities, irrespective of registration179; the imposition of responsibilities on registrants180; and penalties for non-compliance181. A person "undertak[ing] an activity on behalf of a foreign principal"182 lies at the core of the operation of the FITS Act. "[P]erson" is defined broadly to include individuals, bodies corporate, bodies politic, partnerships, associations, organisations, and any combination of individuals who together constitute a body183. This would include "think-tanks" (like LibertyWorks), public interest groups, academic institutions, media organisations and individual citizens alike. The breadth of the legal effect and practical operation of the FITS Act arises in two ways: first, the phrases "undertakes an activity on behalf of" 174 FITS Act, s 3. Each italicised term is defined in the FITS Act. 175 "[S]cheme" means the FITS Act and rules made under s 71: FITS Act, s 10 definitions of "scheme" and "rules". Two sets of rules have been made under s 71: Foreign Influence Transparency Scheme Rules 2018 (Cth) ("FITS Rules") and Foreign Influence Transparency Scheme (Disclosure in Communications Activity) Rules 2018 (Cth) ("Disclosure Rules"). 176 FITS Act, ss 16 and 18; see also Pt 2, Div 3. 177 FITS Act, s 42. 178 FITS Act, s 43; FITS Rules, s 6. 179 FITS Act, s 38; Disclosure Rules, Pt 2. 180 FITS Act, Pt 3. 181 FITS Act, Pt 5. 182 FITS Act, s 18(1); see also ss 11 and 13A. 183 FITS Act, s 10 definition of "person". and "foreign principal" are broadly defined and, second, the scheme's mechanisms are broad in nature and effect. Those statements require explanation. "[F]oreign principal"184 is broadly defined to mean a "foreign government", a "foreign government related entity", a "foreign political organisation" and a "foreign government related individual"185. In this way, the term "foreign principal" not only captures foreign governments and foreign political parties and individuals or corporations related to them, it also extends to "a foreign organisation that exists primarily to pursue political objectives"186. By definition, a foreign organisation that exists primarily to pursue political objectives does not have to have any connection to a foreign government or a foreign political party. The political objectives pursued by such an organisation need not be linked in any way to a foreign government. Indeed, what is "political" is undefined187. Next, irrespective of whether consideration is payable188, "[a] person undertakes an activity on behalf of a foreign principal if"189: the person undertakes the activity in any of the following circumstances: under an arrangement with the foreign principal; in the service of the foreign principal; (iii) on the order or at the request of the foreign principal; (iv) under the direction of the foreign principal; and at the time the arrangement or service is entered into, or the order, request or direction made, both the person and the foreign principal knew or expected that: 184 FITS Act, s 10 definition of "foreign principal". 185 Each term is defined in s 10 of the FITS Act. 186 FITS Act, s 10 para (b) of the definition of "foreign political organisation". 187 cf ACTV (1992) 177 CLR 106 at 125-126. 188 FITS Act, s 11(2). 189 FITS Act, s 11(1). the person would or might undertake the activity; and the person would or might do so in circumstances set out in section 20, 21, 22 or 23 (whether or not the parties expressly considered the existence of the scheme)." (emphasis added) The phrases "in the service of", "on the order or at the request of" and "under the direction of" are self-explanatory. They seek to address where a person is acting as what might loosely be described as an "agent" of a foreign principal. But what of the first identified connection – acting "under an arrangement"? "[A]rrangement" is defined190 to include "a contract, agreement, understanding or other arrangement of any kind, whether written or unwritten". The activities undertaken "on behalf of" a foreign principal as defined in the FITS Act therefore extend well beyond any ordinary understanding of an agency or employment relationship. The consequence is that activities of a collaborative kind that are instigated or principally pursued by the person liable to register (not just those undertaken at the behest or direction of a foreign principal) are captured by the scheme. registrable activity on behalf of a It is then necessary to address registration under the scheme. Section 18 of the FITS Act identifies the persons who are liable to register191. It provides that a person is liable to register in relation to a foreign principal if the person undertakes foreign principal or enters a "registrable arrangement"192 with a foreign principal. Under s 16(1), once a person has become liable to register they "must apply to the Secretary for registration" within 14 days193 (emphasis added). A knowing or reckless failure to do so is an offence194. 190 FITS Act, s 10 definition of "arrangement". 191 A person is not required to register if they are exempt under Pt 2, Div 4 of the Act: FITS Act, ss 20(b), 21(1)(c), 22(d), 23(d). See also FITS Rules, s 5. No exemption was said to apply to LibertyWorks. 192 A registrable arrangement is relevantly an arrangement between a person and a foreign principal for the person to undertake, on behalf of the foreign principal, one or more activities which, if undertaken, would be registrable: FITS Act, s 13A. 193 Once a person becomes liable to register, they remain liable until they cease to be liable under s 19: FITS Act, s 18(2). 194 FITS Act, s 57. A registration application must be "in writing", "in an approved form (if any)", "given in an approved manner (if any)" and "accompanied by any information or documents required by the Secretary"195. No "approved form" or "approved manner" of making an application for the purpose of s 16(2) is presently prescribed. The Attorney-General's Department has published a "factsheet" setting out the "information and documents that must be provided" by persons registering under the scheme196. The documentation is extensive in nature and subject matter. Once an application is made that complies with the requirements in s 16(2), the person is "registered" under the scheme197 and is a What is a "registrable activity" is addressed in ss 20 to 23. For present purposes, it is sufficient to focus on just one of the registrable activities identified in s 21(1), namely "[c]ommunications activity" undertaken in Australia "for the purpose of political or governmental influence"199. In respect of this registrable activity, a person's liability to register arises from the fact that the person has engaged, or proposes to engage, in political communication. A person relevantly undertakes a "communications activity" if they communicate or distribute "information or material to the public or a section of the public" or produce "information or material for the purpose of the information or material being communicated or distributed to the public or a section of the public"200 (emphasis added) and the sole or primary purpose, or a substantial purpose, of the communications activity is to "affect in any way"201, among other things202, "a process in relation to a federal election"203, "a process in relation to a federal 195 FITS Act, s 16(2). 196 Attorney-General's Department, Foreign Influence Transparency Scheme: Factsheet 15, April 2019. 197 FITS Act, s 17. 198 FITS Act, s 10 definition of "registrant". 199 FITS Act, s 21(1), table item 3. 200 FITS Act, s 13(1). 201 FITS Act, s 10 definition of "influence". 202 See FITS Act, s 12(1). 203 FITS Act, s 12(1)(a). government decision"204 or "the public, or a section of the public, in relation to" such a process205. Three aspects of the breadth of "communications activity" should be noted. First, a "federal government decision"206 includes a decision of any kind in relation to any matter, including administrative, legislative and policy matters, whether or not the decision is final or formal207. Second, "information or material" includes "information or material in any form, including oral, visual, graphic, written, electronic, digital and pictorial forms"208 (emphasis added) and would include, among other things, verbal or silent protests, media campaigns and academic work. Third, the "purpose of an activity"209 is determined by reference to210: "the intention of the person undertaking the activity or that person's belief (if any) about the intention of any foreign principal on whose behalf the activity is undertaken", and211: "either or both of the following: the intention of any foreign principal on whose behalf the activity is undertaken; all of the circumstances in which the activity is undertaken." (emphasis added) As is self-evident, these provisions regulate political communications of the broadest kind between members of the public. 204 FITS Act, s 12(1)(b). 205 FITS Act, s 12(2). 206 FITS Act, ss 12(1)(b), 12(3), 12(4). 207 FITS Act, s 12(4). 208 FITS Act, s 13(2). 209 FITS Act, s 14. 210 FITS Act, s 14(a). 211 FITS Act, s 14(b). Disclosure and record keeping Among other responsibilities212, persons liable to register and registrants must disclose certain the Secretary. information and documents Initial registration213 and annual renewal214 applications must be "accompanied by any information or documents required by the Secretary". Registrants have an ongoing obligation to give "a notice" to the Secretary if they become aware that information provided to the Secretary "is, or will become, inaccurate or misleading in a material particular" or "omits, or will omit, any matter or thing without which the information is or will be misleading"215. The notice must correct the inaccuracy or misleading impression216 and it must be "accompanied by any information or documents required by the Secretary"217. Additional disclosure obligations arise at the beginning of, and during, certain voting periods218. Registrants are also obliged to keep certain records for up to ten years219 about: registrable activities the person undertakes; benefits provided to the person by the foreign principal; information or material forming part of any registrable communications activity; any registrable arrangement; and "other information or material communicated or distributed to the public or a section of the public" on behalf of the foreign principal220. The Secretary may compel a person to produce any "information" or "documents" that may satisfy the Secretary as to whether the person is liable to register if the Secretary "reasonably suspects" the person might be liable to register221. The Secretary also may compel a person (irrespective of whether they 212 FITS Act, Pt 3. 213 FITS Act, s 16(2)(d). See [144] above. 214 FITS Act, s 39(2)(d). 215 FITS Act, s 34(1). 216 FITS Act, s 34(1). 217 FITS Act, s 34(3)(d). 218 FITS Act, ss 36 and 37. 219 FITS Act, s 40(1) and (1A). 220 FITS Act, s 40(2). 221 FITS Act, s 45. are a registrant) to produce any "information" or "documents" if the Secretary "reasonably believes" the person has information or documents "relevant to the operation of the scheme"222. Failure to give a notice required under Div 2 of Pt 3, failure to keep records as required under s 40, or failure to comply with a notice issued under s 45 or s 46 is an offence223. Disclosure in communications activity A person who undertakes a registrable communications activity on behalf of a foreign principal (whether or not the person is a registrant) "must make a disclosure about the foreign principal in accordance with rules made for the purposes of" s 38(2) of the FITS Act224 (emphasis added). In other words, a person must disclose the fact of a relevant relationship with a foreign principal within a registrable communications activity. Failure to do so is an offence225. (Cth) (Disclosure The Foreign Influence Transparency Scheme Communications Activity) Rules 2018 ("the Disclosure Rules") relevantly prescribe the disclosure required for the purposes of s 38(2) of the FITS Act. Section 5(1) of the Disclosure Rules prescribes certain "instances of communications activity" (for example, and among others, communication or distribution of printed material, streaming music, broadcasting by radio or television or oral communication made in person) and identifies the form and manner of disclosure required for each instance of communications activity (for example, at the end or bottom of each page of printed material in a type size that can be read by a person with 20/20 vision without visual aid, in an announcement at the end of the communication, or at the beginning of an oral communication in person). Section 5(2) prescribes that the content of the disclosure (except for radio advertisements and authorised political material) must: "identify the person undertaking the communications activity"; "identify the foreign principal on whose behalf the person undertakes the communications activity"; "include a statement that the communications activity is undertaken on behalf of the foreign principal"; and "include a statement that the disclosure is 222 FITS Act, s 46. 223 FITS Act, ss 58(1), 58(3), 59. 224 FITS Act, s 38(1). 225 FITS Act, s 58(2). made under the [FITS Act]". It provides that the disclosure could be worded along the following lines: "This material is communicated by [name of person] on behalf of [name of foreign principal]. This disclosure is made under the [FITS Act]." Scheme information Division 4 of Pt 4 of the FITS Act addresses communicating and dealing with scheme information. "Scheme information"226, relevantly, is information obtained by a scheme official in the course of performing functions or exercising powers under the scheme. The Secretary, among others, is a "scheme official"227. A scheme official may communicate or otherwise deal with scheme information for the purposes of performing functions or exercising powers under the scheme or otherwise in the course of performing their functions in relation to the scheme228. However, the FITS Act provides that the Secretary may communicate scheme information for specified purposes, including to an "enforcement body" for the purpose of "an enforcement related activity" within the meaning of the Privacy Act 1988 (Cth)229 or to any Department, agency or authority of the Commonwealth, a State or a Territory, or an Australian police force for the protection of "security" within the meaning of the Australian Security Intelligence Organisation Act 1979 (Cth)230. Ordinarily "when a power to require disclosure of information is conferred for a particular purpose, the extent of dissemination or use of the information disclosed must itself be limited by the purpose for which the power was 226 FITS Act, s 50(a). 227 FITS Act, s 51(a). 228 FITS Act, s 52. 229 FITS Act, s 53(1), table item 1. "[E]nforcement body" is defined in s 6(1) of the Privacy Act to include a broad array of law enforcement bodies, and "enforcement related activity" is defined to include, among other things, "the prevention, detection, investigation, prosecution or punishment of" criminal offences or breaches of a law imposing a penalty or sanction. 230 FITS Act, s 53(1), table item 3. "[S]ecurity" is defined in s 4 of the Australian Security Intelligence Organisation Act to mean protection from espionage, sabotage, politically motivated violence, promotion of communal violence, attacks on Australia's defence system or acts of foreign interference. conferred"231. As the Commonwealth accepted, however, the additional specified purposes in s 53 of the FITS Act expressly define "a wider set of purposes for which the information may [lawfully] be disseminated". Non-public register Section 42(1) requires the Secretary to keep a "register" of information "in relation to the scheme". Section 42(2) and (3) specify what the Secretary must include on the register. The register "must" include, in relation to each registrant232: the name of the person and the foreign principal; the registration application, any renewal application and any notices given by the person under Div 2 of Pt 3233, along with any "information or documents" that accompanied such an application or notice; a record of any other communications between the person and the Secretary; any information prescribed by rules made for the purposes of s 43(1)(c); and "any other information or documents the Secretary considers appropriate" (emphasis added). The register "must" also include234: any provisional and final transparency notices and any variations and revocations of transparency notices; any notices given under s 45 or s 46 to a person other than a registrant "and any responses received"; any information prescribed by rules made for the purposes of s 43(1)(c) other than in relation to registrants; and "any other information or documents the Secretary considers appropriate" (emphasis added). What is on the register is not publicly available. What is on the register is any document or information the Secretary (or any other scheme official) gathers pursuant to, or for the purposes of, the FITS Act. Public website – certain scheme information must be made publicly available The public website is a subset of the non-public register. Section 43(1) prescribes that the following information "must" be made publicly available235, on a website, in relation to each person who is, or has at any time been, registered 231 Johns v Australian Securities Commission (1993) 178 CLR 408 at 423; see also 232 FITS Act, s 42(2). 233 Which contains ss 34-37 of the FITS Act. 234 FITS Act, s 42(3). 235 "Despite" s 43(1), the website "must not" include information that the Secretary is satisfied "(a) is commercially sensitive; or (b) affects national security; or (c) is of a kind prescribed by the rules" for the purposes of s 43(2)(c): FITS Act, s 43(2). See also s 6A of the FITS Rules. in relation to a foreign principal236: "the name of the person and the foreign principal"; "a description of the kind of registrable activities the person undertakes or undertook on behalf of the foreign principal"; and "any other information prescribed by the rules for the purposes of" s 43(1)(c). Section 6 of the Foreign Influence Transparency Scheme Rules 2018 (Cth) ("the FITS Rules") prescribes that for the purposes of s 43(1)(c) in relation to each registrant the following information about the person and the foreign principal is to be made publicly available on the website: any trading name and ABN (or foreign equivalent) of the person and the foreign principal237; any other name by which the person is known238; if they are individuals, the person's occupation, any other names by which the foreign principal is known and the foreign principal's title239; if the person is a former Cabinet Minister or recent designated position holder, that fact240; and the name of the country that the foreign principal is part of or related to and the type of foreign principal241. Information about the registrable activities is also to be made publicly available, including a description of the registrable activities and the date or period over which they are to be, or were, undertaken242; whether the registrable activities are undertaken "under an arrangement with", "in the service of", "on the order or at the request of" or "under the direction of" the foreign principal243; and a description of the arrangement, order, request or direction or a description of the relationship of "service"244. 236 FITS Act, s 43(1)(a)-(c). 237 FITS Rules, s 6(a)-(b), (g)-(h). 238 FITS Rules, s 6(c) 239 FITS Rules, s 6(d) and (i). 240 FITS Rules, s 6(e)-(f). 241 FITS Rules, s 6(j)-(k). 242 FITS Rules, s 6(l)-(m). 243 FITS Rules, s 6(n). 244 FITS Rules, s 6(o)-(p). The gap – two repositories of scheme information It is necessary to say something further about the two repositories of scheme information and the gap that exists between them. As has been seen, the FITS Act contemplates: (a) a non-public "register" containing a wide range of information and documents obtained by the Secretary and scheme officials in the course of administering the scheme (namely, the gamut of "scheme information") and (b) a separate, publicly accessible "website" containing a far more limited class of scheme information. It is evident from the text of the FITS Act and the FITS Rules that the "register" and "website" are separate and do not mirror each other. There are separate provisions dealing with information and documents to be included on the register245 and information to be made publicly available246. Unlike certain other Commonwealth Acts, the register maintained by the Secretary under the FITS Act is not itself made publicly available, either in its entirety247 or subject to removing information that is commercially sensitive248 or otherwise prejudicial by way of a carveout from the register itself. The public website contains a more limited class of information and documents. The simplified outline of Pt 4 in s 41 states that "[s]ome scheme information will be made publicly available (mainly, the names of registrants, former registrants and foreign principals and descriptions of the registrable activities being undertaken)", and that "[o]ther scheme information" must be handled in accordance with the Privacy Act, Pt 5.6 of the Criminal Code (Cth) and the authorisations in Div 4 of Pt 4 of the FITS Act (emphasis added). Consistent with the simplified outline, s 43 is headed "Certain information to be made publicly available" (emphasis added). Next, the types of information and documents that must be made publicly available are identified with precision in s 43(1)(a)-(b) and (2A) of the FITS Act and s 6 of the FITS Rules. That specificity may be contrasted with the generality of language used to identify the information and documents that must be placed on the register, the starkest illustration of which is that the Secretary must include on the register "any ... information or documents the Secretary considers appropriate" 245 FITS Act, s 42. 246 FITS Act, s 43. 247 cf Commonwealth Electoral Act 1918 (Cth), ss 287N and 287Q. 248 cf Competition and Consumer Act 2010 (Cth), s 152BCW. that are not otherwise specifically identified in s 42(2) and (3)249 (emphasis added). There is no equivalent provision in relation to the public website. Relatedly, s 42(2) and (3) specifically require that the following documents250, among others, must be included on the non-public register251: applications for registration and renewal of registration with any accompanying information and documents, notices given to the Secretary with any accompanying information and documents, notices given by the Secretary requiring information and documents and any responses to such notices (presumably including the information and documents provided), and any correspondence between the Secretary and the person (for example, by email or letter). By contrast, there is no indication in the FITS Act or the FITS Rules that any of those documents will be uploaded onto the public website. What is to be contained on the public website is limited to specified types of "information" identified in s 43(1)(a) and (b) of the FITS Act and s 6 of the FITS Rules252. The publicly available information and documents constitute a subset of the categories of information and documents identified in s 42 that must be put on the register. The "name of the person and the foreign principal"253, provisional and final transparency notices and any variations and revocations of transparency notices254, and any information "prescribed by the rules for the purposes of" s 43(1)(c)255 are expressly identified as information and documents that must be contained on both the register and website. The only other category of information that must be put on the website is a description of the registrable activities256. The overlap between the register and what is made publicly available ends there. 249 FITS Act, s 42(2)(g) and (3)(c). 250 See Acts Interpretation Act 1901 (Cth), s 2B definition of "document". 251 See especially FITS Act, s 42(2)(b)-(e) and (3)(a). 252 Provisional and final transparency notices and any variation or revocation of a transparency notice must also be made available to the public "on a website": FITS Act, s 43(2A). 253 FITS Act, ss 42(2)(a) and 43(1)(a). 254 FITS Act, ss 42(3)(aa)-(ac) and 43(2A). 255 FITS Act, ss 42(2)(f), 42(3)(b), 43(1)(c). See also FITS Rules, s 6. 256 FITS Act, s 43(1)(b). There is no statutory basis for the Secretary to make information or documents publicly available other than those referred to in s 43(1)(a)-(b) and (2A) of the FITS Act and prescribed by the FITS Rules for the purposes of s 43(1)(c). There is no provision providing that the Secretary may place information or documents on the public website, for example, if the Secretary considers it appropriate to do so or considers the information relevant to the scheme257. The FITS Act only expressly confers obligations on the Secretary in respect of the Secretary "must make" publicly available258 (a) information and (b) information that, despite falling within s 43(1), "must not" be made publicly available259. that Degree of disconnect between register and website The disconnect between repositories of non-public and publicly available information under the FITS Act is not found in the Foreign Agents Registration Act 22 USC §§611-621 ("the FARA"), the Act on which the FITS Act was based260. Under the FARA, essentially all information and documents provided by registrants are made publicly available261. The Attorney General must retain "in permanent form one copy of all registration statements furnished" under the FARA, "and the same shall be public records and open to public examination and inspection"262. The Attorney General must "maintain, and make available to the public over the Internet, without a fee or other access charge ... an electronic database that": includes the information contained in registration statements and updates given under the FARA; and is searchable and sortable, at least by the 257 cf Acts Interpretation Act, s 33(2A). 258 FITS Act, s 43(1) and (2A). See Fenton v Hampton (1858) 11 Moo 347 at 360 [14 ER 727 at 732]; Minister for Immigration and Ethnic Affairs v Mayer (1985) 157 CLR 290 at 301-302; Egan v Willis (1998) 195 CLR 424 at 468 [83]. See also Herzfeld and Prince, Interpretation, 2nd ed (2020) at 76 [4.210]. 259 FITS Act, s 43(2). 260 Australia, Parliament, Parliamentary Joint Committee on Intelligence and Security, Advisory Report on the Foreign Influence Transparency Scheme Bill 2017 (2018) 261 Section 616(a) of the FARA provides that the Attorney General "may withdraw from public examination the registration statement and other statements of any agent of a foreign principal whose activities have ceased to be of a character which requires registration". categories of information that registrants are required to include in their registration statements under §612(a)263. The Attorney General must make each registration statement and update available over the Internet "as soon as technically practicable after" it is filed264. In addition, copies of any informational materials distributed on behalf of a foreign principal that are provided to the Attorney General pursuant to §614(a) "shall be available for public inspection"265 – that is, informational materials that must contain an "[i]dentification statement"266 within the materials akin to the disclosure required by s 38 of the FITS Act. that the fact the FARA In response terms, the Commonwealth sought to characterise the disconnect between the FITS Act register and public website as "narrow", particularly on the basis that the gap would depend on the scope of the Secretary's powers to lawfully compel information and documents under ss 16(2)(d) and 39(2)(d). While this is a factor that will contribute to the degree of disconnect267, it is not the only relevant factor. Although it is not possible to identify the precise degree of disconnect, evidently the disconnect is not illusory. in different The nature of the information and documents provided both by registrants and by other members of the public either voluntarily or in response to what would be an ordinary and lawful exercise of power by the Secretary may result in a significant divergence between the register and the public website. The following examples illustrate this point. First, pursuant to s 16(2)(d), the Secretary may ask a person who wishes to lodge a registration application to provide "any information or documents" that would assist the Secretary to understand the nature of the relationship between the person and the foreign principal. The person may (but need not necessarily) respond by providing extensive information and documents about the relationship (such as contemporaneous records of meetings between the person and the foreign 263 FARA, §616(d)(1). 264 FARA, §616(d)(2). 265 FARA, §614(c). 266 FARA, §614(b). 267 See Johns (1993) 178 CLR 408 at 423, citing Marcel v Commissioner of Police of the Metropolis [1992] Ch 225 at 234; see also 424, 436, 453, 458, 468; Katsuno v The Queen (1999) 199 CLR 40 at 57 [24]; see also 50 [2], 65 [54], 87-88 [110]-[111]. See also R v Toohey; Ex parte Northern Land Council (1981) 151 CLR principal, financial transactions, and correspondence between the person and the foreign principal) simply because they wish to make it apparent why the relationship is legitimate. Every supporting document provided must be placed on the register268, but only the particular information falling within s 43(1) of the FITS Act and s 6 of the FITS Rules would be placed on the website (namely, specific information about the person and the foreign principal and information about the registrable activities). Second, the Revised Explanatory Memorandum to the Foreign Influence Transparency Scheme Bill 2017 (Cth) explained that s 42(3)(c) (which requires that any other information or documents that the Secretary considers appropriate be included on the register) was intended to apply to information or documents that "are relevant to the scheme's management and administration"269. It gives the following example of the kind of information that may be relevant: "Person A ... emails the Secretary to provide information about Person B, who Person A suspects is undertaking registrable activities on behalf of foreign principal X. If, upon investigation, scheme officials conclude that Person B may be required to register under the scheme, and Person B does so and information is made available on the register relating to Person B's application, the Secretary may consider it appropriate to also include the email from Person A on the register, subject to privacy considerations." The original email from Person A was not in response to a notice issued by the Secretary compelling information or documents. It does not, therefore, raise any question about the Secretary's powers to lawfully compel information. It would be placed on the register if the Secretary considered it "appropriate" to do so270, but there would not appear to be any basis for placing it on the public website. Third, the Secretary may issue a notice under s 46 of the FITS Act compelling a registrant to produce any "information" or "documents" that they are required to keep records of pursuant to s 40 on the basis that the Secretary "reasonably believes" the person has entered into a new registrable arrangement with the foreign principal. In response to the notice, the person may provide a range of information and documents to establish why proposed activities fall within an existing arrangement in respect of which the person is registered, including detailed information about "benefits provided to the person by the foreign 268 FITS Act, s 42(2)(b). 269 Australia, Senate, Foreign Influence Transparency Scheme Bill 2017, Revised Explanatory Memorandum at 120 [674]. 270 FITS Act, s 42(3)(c); see also s 42(2)(g). principal", material forming part of a registrable communications activity, and the registrable arrangement271. The registrant's response could be included on the register either as "a record of" communications between the person and the Secretary or as "other information or documents the Secretary considers appropriate"272. There would not appear to be any basis for placing the response on the public website, although it may be necessary to "correct or update" information on the website having regard to information in the response273. Fourth, as the Commonwealth acknowledged, certain of the information sought from LibertyWorks in a notice issued to it pursuant to s 45 of the FITS Act would not appear on the public website. It is not necessary for present purposes to determine the extent to which it might be possible to narrow or eliminate the gap between the public website and non-public register by making rules for the purposes of s 43(1)(c) prescribing that all (or the vast majority) of the information and documents that must be on the register must be made publicly available. The FITS Rules as currently in force simply do not do that and a large degree of disconnect presently exists. A real question remains, however, whether rules requiring that information of such breadth be made publicly available would be valid under s 71(1) of the FITS Act as either "required or permitted by" s 43(1)(c) or "necessary or convenient to be prescribed for carrying out or giving effect to" the FITS Act. Regulations or rules made pursuant to a statute may not "vary or depart from the positive provisions made by" the authorising statute or "go outside the field of operation which the Act marks out for itself"274. It would be surprising if it were possible to make rules that could effectively circumvent Parliament's evident intent, reflected in the text of the FITS Act, to create two separate repositories of scheme information, with the publicly available information being of a more limited kind. 271 See FITS Act, s 40(2)(b)-(d). 272 FITS Act, s 42(2)(e) and (g). 273 FITS Act, s 44. 274 Morton v Union Steamship Co of New Zealand Ltd (1951) 83 CLR 402 at 410. See also Toohey (1981) 151 CLR 170 at 187; Plaintiff M47/2012 v Director-General of Security (2012) 251 CLR 1 at 77 [174]. And see Australian Communist Party v The Commonwealth (1951) 83 CLR 1 at 205-206, 258, 263. Burden The legal and practical operation of the impugned provisions in respect of registrable communications activity undertaken on behalf of a foreign principal effects a substantial burden on the implied freedom of political communication275. It is important to recall that the impugned provisions are not limited to circumstances where a person is acting as an agent for, in the service of, on the order or at the request of, or under the direction of a foreign government, a foreign individual. government related entity or a foreign government related The impugned provisions apply to a person who has an arrangement with a foreign organisation that exists primarily to pursue political objectives. And the legal effect and practical operation of the impugned provisions focusses on persons connected with a foreign principal who want to communicate about political matters whether or not the views to be expressed by the registrant are aligned with the views or interests of the foreign principal. The requirement to disclose the fact of a relationship with a foreign principal within a registrable communications activity276 is a direct regulation of political speech277. Although the disclosure requirement is content neutral278, as it "applies evenhandedly to advocates of differing viewpoints, it is a direct regulation of the content of speech"279, because every registrable communications activity must contain prescribed information about the relationship between the person and the foreign principal. But the FITS Act goes further – there is burden upon burden. The Commonwealth acknowledged that the effect of s 57 of the FITS Act is that types of political "certain persons cannot communication if they knowingly or recklessly fail to register" (emphasis added). lawfully engage in certain 275 FITS Act, s 21(1), table item 3. 276 FITS Act, s 38; Disclosure Rules, Pt 2. 277 McIntyre v Ohio Elections Commission (1995) 514 US 334 at 345-346; Buckley v American Constitutional Law Foundation Inc (1999) 525 US 182 at 209. See also Coleman (2004) 220 CLR 1 at 30 [27]; Hogan (2011) 243 CLR 506 at 555-556 [95]-[96]; Wotton (2012) 246 CLR 1 at 16 [30], 30 [78]. 278 See Brown (2017) 261 CLR 328 at 414 [273]-[274], 415 [276], but cf 389 [199], 390 [202]; Clubb (2019) 267 CLR 171 at 197 [55], 213 [123], 227 [170], 230 [180], 232 [182], 301 [375]; Banerji (2019) 267 CLR 373 at 420 [90]. 279 McIntyre (1995) 514 US 334 at 345 (footnote omitted). But the burden is even more significant. The provisions of the FITS Act – the registration obligations280; the associated obligations to provide information and documents to the Secretary and to keep records281; the criminal consequences for failing to register or comply with obligations282; the gap between the scheme information made publicly available283 and the scheme information kept on the non-public register maintained by the Secretary284; and the possibility that information obtained under the scheme may be communicated to law enforcement bodies285 – are likely, in practice, to have significant deterrent effects on a person who would otherwise engage in legitimate and lawful political communication286. The potential to deter general political discussion between ordinary members of the public is real. This is not a new concern. In McIntyre v Ohio Elections Commission287, the Supreme Court of the United States expressed concern about the deterrent effects of a law requiring the identification of information about a person who distributed campaign literature because the provisions applied "not only to the activities of candidates and their organized supporters, but also to individuals acting independently and using only their own modest resources". It is not just a burden on political communication, but a burden imposed before a person communicates. In this sense, the FITS Act imposes what might be 280 FITS Act, ss 16 and 18. 281 FITS Act, ss 16(2)(d), The Commonwealth accepted that "the level of the burden is connected to" what information and documents may be required by the Secretary, but said that the information that may be required "is not disproportionately burdensome". 282 FITS Act, ss 57 and 58. See Brown (2017) 261 CLR 328 at 357-358 [81], 359 [87], 460 [411], but cf 408-409 [259]. See also Banerji (2019) 267 CLR 373 at 403 [39]. 283 FITS Act, s 43; FITS Rules, s 6. 284 FITS Act, s 42. 285 FITS Act, s 53. 286 See Cunliffe v The Commonwealth (1994) 182 CLR 272 at 301; see also 341. See also Federal Election Commission v Massachusetts Citizens for Life Inc (1986) 479 US 238 at 253-255, especially at 254; Citizens United v Federal Election Commission (2010) 558 US 310 at 337-338. 287 (1995) 514 US 334 at 351. See also United States v Rumely (1953) 345 US 41 at 46. described as a prior restraint288 on "communications activity". The operation of the impugned provisions in respect of registrable "communications activity" is apt to result, in practice, in an immediate "freeze" on political communications289, "prevent[ing] speech from ever occurring"290. Although the FITS Act does not impose a "legal sanction" on engaging in political communication, the burden is significant or severe because "[t]he finger of government leveled against" registrants "is ominous"; "the spectre of a government agent will look over the shoulder" of those who register under the scheme291. The present case is illustrative of the breadth of the burden292. The Secretary issued a notice under s 45 of the FITS Act requiring LibertyWorks to provide, among other things, documents that would plainly identify the names of participants, and speakers, at the CPAC Australia event. Such a disclosure could discourage persons from participating in political discussion out of fear that their political views (especially if controversial) may be made public, or conveyed to law enforcement bodies, and have consequences for them293. It may be inferred from the facts of the amended special case that the issuing of a s 45 notice to LibertyWorks resulted in a reluctance on the part of members of the Australian community to speak at and attend the CPAC Australia event (and therefore participate in legitimate political communication). The Commonwealth submitted that the possibility that disclosure of the identities of persons who are planning to speak at a CPAC Australia event would deter their participation is irrelevant 288 See Blackstone, Commentaries on the Laws of England, 2nd ed (rev) (1879), bk 4, ch 11 at 151-152: "freedom of the press" is defined as the right to be free from previous restraints. See also Cunliffe (1994) 182 CLR 272 at 299-300, 301, 341; Levy v Victoria (1997) 189 CLR 579 at 595; Wotton (2012) 246 CLR 1 at 15 [28]; Attorney-General (SA) v Adelaide City Corporation (2013) 249 CLR 1 at 62 [133]. cf Communist Party of the United States v Subversive Activities Control Board (1961) 367 US 1 at 172. 289 cf Nebraska Press Assn v Stuart (1976) 427 US 539 at 559. 290 Chemerinsky, Constitutional Law: Principles and Policies, 3rd ed (2006) at 954. 291 Rumely (1953) 345 US 41 at 57. 292 cf Clubb (2019) 267 CLR 171 at 228 [172]. 293 See, eg, Rumely (1953) 345 US 41 at 57-58; National Association for the Advancement of Colored People v Alabama (1958) 357 US 449 at 462-463; Bates v City of Little Rock (1960) 361 US 516 at 523-524; Shelton v Tucker (1960) 364 US 479 at 485-489; Gibson v Florida Legislative Investigation Committee (1963) 372 US 539 at 555-557. because "the whole point of the transparency regime is to reveal the[se] kinds of connections between people and foreign political actors". That submission does not address the fact that the persons who may be dissuaded from engaging in political communication include persons whom the FITS Act is not intended to regulate – namely, participants who are not registrants or liable to register. It is true that the burden applies to a "subset" of political communication, insofar as the principal burden is on political communication undertaken "on behalf of" a foreign principal (not communications undertaken purely by a person on their own behalf or communications made directly by a foreign principal). However, as Deane and Toohey JJ observed in Australian Capital Television Pty Ltd v The Commonwealth294, "the fact that the number of groups or individuals who might wish to express their political views in a particular way is limited, does not suffice to justify a law suppressing the freedom of communication McCloy v New South Wales295 that "[i]t would be wrong to conclude ... that, just because [impugned] provisions affect only a small section of the electorate, they can have only a small effect on the implied freedom". that particular way". Nettle J similarly observed The impugned provisions effect a substantial burden on general "public discussion ... of the views of all interested persons, groups and bodies and ... public participation in, and access to, that discussion" – matters which are fundamental to our system of government296. In their operation in relation to registrable communications activity, the impugned provisions regulate general political discussion of the broadest kind between members of the public (as well as to political representatives) and are likely, in practice, to have significant deterrent effects on persons who would otherwise engage in legitimate and lawful political communication. A burden of this kind requires a compelling justification297. Legitimate purpose To answer the second question – whether the purpose of the FITS Act is legitimate – it is necessary to identify the "true purpose" of the statute by 294 (1992) 177 CLR 106 at 175. 295 (2015) 257 CLR 178 at 265 [244]. 296 ACTV (1992) 177 CLR 106 at 139. 297 Brown (2017) 261 CLR 328 at 477-478 [478]; Clubb (2019) 267 CLR 171 at "ordinary processes of construction"298, having regard to "the text, the context and, if relevant, the history of the law"299. The purpose is "not what the law does in its terms but what the law is designed to achieve in fact"300. It should be identified at a higher level of generality than the meaning of the words of the provisions, focussing instead on the "mischief" to which the provisions are directed301. A "legitimate purpose" is one which is "compatible with the system of representative and responsible government established by the Constitution"302, in the sense that it "does not impede the functioning of that system and all that it entails"303. As has been observed, the Commonwealth accepted that the purpose of the FITS Act is to minimise the risk of foreign principals exerting undisclosed influence upon the integrity of Australia's political or election processes. That purpose is not only compatible with the system of representative and responsible government, it also seeks to preserve and enhance that system304. The legitimacy of the purpose is supported by the materials in the amended special case, which make clear that undisclosed foreign influence can impede the ability of the Australian public and decision-makers to make informed decisions because it can deny those persons proper visibility over what interests are being advanced and by whom. But, as explained, the impugned provisions go well beyond the legitimate purpose of the FITS Act. 298 Brown (2017) 261 CLR 328 at 362 [96]. See also Unions No 1 (2013) 252 CLR 530 299 Brown (2017) 261 CLR 328 at 432 [321]. 300 Brown (2017) 261 CLR 328 at 392 [209]; see also 432-433 [322]. See also McCloy (2015) 257 CLR 178 at 232 [132]; Unions NSW v New South Wales (2019) 264 CLR 595 at 657 [171] ("Unions No 2"). 301 APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 394 [178]; McCloy (2015) 257 CLR 178 at 232 [132]; Brown (2017) 261 CLR 328 at 363 [101], 391-392 [208], 432 [321]; Unions No 2 (2019) 264 CLR 595 at 657 [171]. 302 McCloy (2015) 257 CLR 178 at 231 [130]. 303 McCloy (2015) 257 CLR 178 at 203 [31]. See also Coleman (2004) 220 CLR 1 at 50-51 [92]-[96], 78 [196], 82 [211]. cf Palmer v Western Australia (2021) 95 ALJR 229 at 269 [197]; 388 ALR 180 at 227-228. 304 See McCloy (2015) 257 CLR 178 at 208 [47]; Banerji (2019) 267 CLR 373 at 423 Impugned provisions impermissibly burden the implied freedom LibertyWorks' challenge to definitions within ss 10, 11, 12, 13, 13A and 14 of the FITS Act should be rejected. Generally speaking, and subject to contrary intent, definitions within an Act do not enact "substantive" law305. In other words, they are not provisions with any operative effect; they simply provide an aid to the construction of the substantive provisions in an Act. No contrary intent may be discerned from the FITS Act. Consequently, the impugned definitional provisions (albeit central to the operation of the FITS Act) may only be challenged to the extent that they contribute to invalidity of the operative provisions and, even then, they may only be challenged insofar as they are relevant to the application of those provisions to LibertyWorks306. It is necessary to address the validity of the operative impugned provisions. Parliament can, consistently with the implied freedom of political communication, require the "registration" of certain persons who seek to influence political processes as an intermediary for a foreign principal and require that such persons disclose, in their political communications, that they are acting on behalf of a foreign principal. However, Parliament's ability to regulate such persons is subject to limits. Where a person, like LibertyWorks, "undertakes" "communications activity" on behalf of a foreign principal for the purpose of political or governmental influence, the impugned provisions are not tailored to achieve the legitimate end of minimising the risk of foreign principals exerting undisclosed influence upon the integrity of Australia's political or election processes. The impugned provisions overreach and are not justified. The gap between the information disclosed by a registrant who has engaged in, or proposes to engage in, a registrable "communications activity" which is made publicly available on the website, and the information and documents disclosed by a registrant but kept on the non-public register maintained by the Secretary (and which may be made available to law enforcement bodies), cannot be explained. As LibertyWorks submitted, the acquisition of information that is not made public does "nothing for ... the sunshine purpose of the [FITS Act]". The scheme information kept on the non-public register is not directed at, 305 Gibb v Federal Commissioner of Taxation (1966) 118 CLR 628 at 635; Kelly v The Queen (2004) 218 CLR 216 at 245 [84], 253 [103]; Moreton Bay Regional Council v Mekpine Pty Ltd (2016) 256 CLR 437 at 451 [61]. 306 Knight (2017) 261 CLR 306 at 324-325 [32]-[33]; Clubb (2019) 267 CLR 171 and cannot be directed at, the identified legitimate purpose. Although the disconnect between the non-public register and the public website required explanation, no "'substantial relation' between the governmental interest and the information required to be disclosed"307 but not made public was identified308, let alone established, by the Commonwealth. No other, wider purpose than to minimise the risk of foreign principals exerting undisclosed influence upon the integrity of Australia's political or election processes was said by the Commonwealth to be pursued. To the extent the Commonwealth suggested that the "detail" regarding the difference between the non-public register and the public website is not relevant to the constitutional question in this case, that must be rejected. The question is whether the FITS Act can validly impose this registration regime in pursuit of the identified legitimate purpose. It cannot. A non-public register does nothing to minimise the risk of undisclosed influence. It does the opposite. A non-public register is in darkness, not sunlight. Put in different terms, there is no rational connection between the non-public information stored on the register and the purpose of the FITS Act – minimising the risk of foreign principals exerting undisclosed influence upon the integrity of Australia's political or election processes. And, to that extent at least, the impugned provisions are unnecessary. The FITS Act contains within it two sets of provisions which are directed at the stated purpose and achieve the stated objective. First, registration, accompanied by the creation of a public website with prescribed contents, is directed at the identified legitimate purpose of minimising the risk of foreign principals exerting undisclosed influence upon the integrity of Australia's political or election processes and is justified. It discloses the fact of the influence, how the influence is effected and by whom and through whom. The gathering of scheme information and storing it on a non-public register does not. Second, the requirement, irrespective of registration, to disclose a connection to a foreign principal in each prescribed communication is directed at the identified legitimate purpose and is justified. The disconnect – the gap – between the two repositories of scheme information, and its consequences, cannot be justified in relation to registrable "communications activity". To that extent, at least, the impugned provisions overreach any legitimate purpose and are not necessary. The impugned provisions are invalid in their operation with respect to registrable "communications activity". 307 Buckley v Valeo (1976) 424 US 1 at 64 (footnote omitted). 308 McCloy (2015) 257 CLR 178 at 201 [24]; Brown (2017) 261 CLR 328 at 370 [131]; Unions No 2 (2019) 264 CLR 595 at 616 [45], 632 [95]-[96]. The FITS Act is invalid to the extent that "communications activity" is a registrable activity within s 21(1), table item 3, on the basis that it infringes the implied freedom of political communication. The requirement, irrespective of registration, to disclose a connection to a foreign principal in a communications activity is directed at the identified legitimate purpose and is justified. As the Commonwealth submitted, to mean "the communications activity is in Australia and is for the purpose of political or governmental influence". construed309 s 38(1)(c) should read and Answers For those reasons, the questions stated for the opinion of the Full Court in the amended special case should be answered as follows: Is the [FITS Act] invalid, to the extent it imposes registration obligations with respect to communication[s] activities, on the ground that it infringes the implied freedom of political communication? Answer: Yes, the FITS Act that "communications activity" is a registrable activity within s 21(1), table item 3, on the basis that it infringes the implied freedom of political communication. the extent invalid Section 38(1)(c) should be read and construed to mean "the communications activity is in Australia and is for the purpose of political or governmental influence". In light of the answer[] to question 1, what relief, if any, should issue? Answer: Unnecessary to answer. Who should pay the costs of and incidental to this special case? Answer: The defendant. 309 Acts Interpretation Act, s 15A. Edelman Introduction In this special case, the plaintiff, LibertyWorks Inc, challenged part of the Foreign Influence Transparency Scheme Act 2018 (Cth) ("the FITS Act"). Its challenge, as it repeatedly confirmed in oral submissions, was limited to the operation of the FITS Act upon "communications activity", being a registrable activity as specified in item 3 of the table in s 21(1). That item, together with associated provisions in the FITS Act, regulates communications activity that is undertaken in Australia "on behalf of" a foreign principal for the purpose of political or governmental influence. The regulation involves a suite of obligations on those who undertake such communications activities, including registration obligations prior to the proposed communication, ongoing reporting obligations, disclosure obligations at the time of communication, record keeping obligations, and renewal of registration obligations. The background and relevant legislative provisions are described in detail in other judgments. I agree with the conclusions of Kiefel CJ, Keane and Gleeson JJ, with their Honours' reasons concerning the legitimacy of the purpose of the FITS Act, and with their use of structured proportionality as the test for validity. However, I take a different approach to the burden imposed by the FITS Act upon political communication. In my view, although the burden imposed by the communications activity provision, being item 3 of the table in s 21(1), and its associated provisions is not excessive it is still a substantial burden upon political communication. It can be accepted that the class of persons who are exposed to the burden is limited to those having a particular connection with a foreign principal. But that class is not as narrow as persons who are genuine agents of a foreign principal. And within that class of persons, the burden is deep. The communications activity upon which the FITS Act focuses is defined in broad terms. It targets the speakers as well as their speech. The effect of the FITS Act upon political communication is not merely incidental: it focuses specifically upon communication for the purpose of political or governmental influence. It operates as a constraint prior to communication, at the time of communication, and after communication by requiring disclosure of a variety of information which can be provided to numerous revenue and law enforcement authorities. It requires records to be kept for up to ten years. During oral argument, the Court raised with the parties two particular respects in which provisions of the FITS Act might arguably impose a burden upon political communication beyond that which is justified. The first of those respects is those provisions concerned with communications made "on behalf of" a foreign Edelman principal310 extending beyond communications as an agent or representative of the foreign principal. The second is those provisions that require information to be provided to the Secretary of the Attorney-General's Department ("the Secretary") for the purposes of registration and which empower the Secretary to put the information on a public website and disclose any of it to a range of authorities311. LibertyWorks had not sought, and did not seek, to challenge any of these provisions directly. Many of them were not even challenged indirectly. As senior counsel for LibertyWorks said on at least four occasions in oral submissions, the provisions that were challenged indirectly were only challenged in their operation in respect of registrable communications activity312. Hence, no submissions were made concerning whether the scheme, in these two particular respects, was suitable, reasonably necessary, or adequate in the balance. If LibertyWorks had brought a direct challenge to any provisions other than the communications activity provision then it would likely have been met by a response from the Commonwealth that s 15A of the Acts Interpretation Act 1901 (Cth) would permit reading down of313, or severance of part of314, the meaning of those provisions, or that those open-textured provisions315 could be disapplied in their operation to the extent of the invalidity that would otherwise arise. In the absence of such challenge, all provisions other than the communications activity provision fall to be considered only as part of the consideration of the interpretation and operation of the communications activity provision, to assess whether the associated burden on political communication can be justified. For the reasons below, the communications activity provision is at the core of the Act. It is a provision with a legitimate purpose that is a matter of the highest government policy. Although the communications activity provision, and associated provisions, impose a substantial burden on political communication, 310 Particularly s 11, when read with the definitions in s 10 of "arrangement", "foreign political organisation", "foreign principal", and "influence". 311 Particularly ss 16, 34, 42, 43, 53. 312 The provisions challenged as part of its challenge to item 3 of the table in s 21(1), and identified in LibertyWorks' written submissions, were certain definitions in s 10, and ss 11-14, 16, 18, 37, 39, 57, 58-59. 313 Particularly FITS Act, s 10, definition of "arrangement". 314 Particularly FITS Act, s 42(2). 315 Particularly FITS Act, ss 16(2)(d), 34(3)(d), 39(2)(d). Edelman that burden is justified. The provisions regulating registrable communications activity are suitable, reasonably necessary, and adequate in the balance. Structured proportionality analysis The parties and the interveners proceeded upon the now accepted approach for analysing whether legislative provisions are incompatible with the freedom of political communication that is implied from the text and structure of the Constitution. In a compelling recent dissection of arguments against structured proportionality, it was observed by reference to its (arguably316) German origins that "one is left with a lingering sense that proportionality is disliked because it is foreign"317. The modern acceptance of multi-jurisdictional, interconnected learning means that we no longer see the world through eyes with which "[w]e are so self-satisfied with our own customs" that "we cannot bring ourselves to believe it possible that a foreigner should in any respect be wiser than ourselves"318. the implied In contrast with a vague, ad hoc application which purports directly to apply the triple uncertainty in the phrase "reasonably appropriate and adapted", a structured proportionality analysis provides a transparent manner in which to determine whether a law which burdens political communication for some freedom of political legitimate purpose has contravened communication. Structured proportionality sets out three tests which such a law must meet in order for its burden upon political communication to be justified: (i) suitability; (ii) reasonable necessity; and (iii) adequacy in the balance. Each of the three tests reflects the roots of the freedom of political communication as an implication derived as a matter of necessity from the text and structure of the Constitution: "[t]he nature and extent of the freedom is governed by the necessity which requires it"319. If the three tests were thought to be incomplete, no coherent fourth test has ever been enunciated, nor a need for it explained, by any critic of proportionality. Nor has it been explained why flexibility is needed: (i) to permit any law which fails one of the three tests nevertheless to be valid; or (ii) to invalidate any law despite its burden on political communication being suitable, reasonably necessary, and adequate in the balance. There remains flexibility within 316 Compare Clubb v Edwards (2019) 267 CLR 171 at 331-332 [465]-[466]. 317 Carter, "Moving Beyond the Common Law Objection to Structured Proportionality" (2021) 49 Federal Law Review 73 at 94 (emphasis in original). 318 Trollope, Orley Farm (1862), vol 1 at 141. 319 APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 350 [27]. See also at 361 [66]. Edelman each test and scope for development of the factors that will influence the application of it. The nature and extent of the freedom cannot be determined independently of the representative democracy considerations that underpin the very reason for the implication. Each stage of structured proportionality is therefore shaped so as to be consistent with those considerations. As to the first stage, "suitability", a provision will rarely fail for lacking rational connection with the legitimate purpose of Parliament for the obvious reason that Parliament's purpose is itself ascertained and derived in part from the expected operation of the provision. Unless the provision is truly arbitrary, serving no purpose at all, a conclusion that a provision has no rational connection with its legitimate purpose – ie that the means employed are incapable of realising its ostensible purpose320 – will usually mean that Parliament has misstated its purpose. And the third stage, "adequacy in the balance", is only reached once it has been concluded that the provision is a reasonably necessary means of achieving the legitimate purpose321. Hence, a conclusion that a provision is inadequate in the balance will often mean that Parliament is entirely precluded from achieving its legitimate policy objective. For an implication founded upon representative democracy, this would be a remarkable outcome. As I have explained previously, invalidation of a law at this third stage should only occur in extreme cases where the purpose is trivial when compared with law places upon political the great burden that the In most cases, the heartland of the dispute in the application of structured proportionality will be at the second stage of that analysis, "reasonable necessity". As will be seen below, this case is no exception. The test of reasonable necessity remains capable of further development and refinement, including the manner in which it applies to different categories of case. But it must be a test which caters for the constitutional feature of representative democracy. It is not merely sufficient to identify a law which could achieve the Parliament's purpose to the same degree but with a lesser burden upon political communication. The presence of adjectives such as "obvious" or "compelling" in the descriptions of such 320 Comcare v Banerji (2019) 267 CLR 373 at 400 [33] and the cases footnoted. 321 Clubb v Edwards (2019) 267 CLR 171 at 268 [274], 330-331 [463], 334 [470]. See also Palmer v Western Australia (2021) 95 ALJR 229 at 285 [267], 287 [275]; 388 ALR 180 at 248, 250. 322 Clubb v Edwards (2019) 267 CLR 171 at 341-343 [491]-[495]. See also Palmer v Western Australia (2021) 95 ALJR 229 at 285 [267]; 388 ALR 180 at 248. Edelman alternatives allows latitude for parliamentary choice in the implementation of public policy323. The legitimate purpose of the FITS Act's regulation of registrable communications activity To ask whether the purpose of a legislative provision is constitutionally illegitimate is to ask only whether the purpose contravenes an express or implied constitutional prohibition. When the enquiry is made in the context of the implied freedom of political communication, the question is whether the purpose of the provision, as opposed to its effect, is to impede freedom of political communication324. Where one of the very objects of Parliament is to burden political communication, the purpose is not "compatible with the maintenance of the constitutionally prescribed system of representative and responsible government" and it is therefore illegitimate325. the communications It is essential to identify at the appropriate level of generality the purpose those activity provision making communications activities undertaken on behalf of a foreign principal. One relevant source for identification of that purpose is the objects of the FITS Act itself. That said, the objects of the Act cannot be conclusive of the purpose326, nor are they necessarily at the appropriate level of generality since the purposes of the registrable 323 See Monis v The Queen (2013) 249 CLR 92 at 214 [347]; Tajjour v New South Wales (2014) 254 CLR 508 at 550 [36]; McCloy v New South Wales (2015) 257 CLR 178 at 211 [58], 217 [81], 270 [258], 285-286 [328]; Brown v Tasmania (2017) 261 CLR 328 at 371-372 [139], 418 [282]; Clubb v Edwards (2019) 267 CLR 171 at 270 [277], 337 [478], 339 [484]; Comcare v Banerji (2019) 267 CLR 373 at 401 [35], 452-453 [194]; Palmer v Western Australia (2021) 95 ALJR 229 at 285 [265], 286 [271]; 388 ALR 180 at 248, 249. 324 Unions NSW v New South Wales (2019) 264 CLR 595 at 657-660 [173]-[178]; Clubb v Edwards (2019) 267 CLR 171 at 327 [454]; Comcare v Banerji (2019) 267 CLR 373 at 452 [191]. See also McCloy v New South Wales (2015) 257 CLR 178 at 203 [31]; Clubb v Edwards (2019) 267 CLR 171 at 194 [44]. 325 Brown v Tasmania (2017) 261 CLR 328 at 364 [104], 376 [156], 416 [277], 432 [319]-[320]; Unions NSW v New South Wales (2019) 264 CLR 595 at 655 [165]. 326 Australian Communist Party v The Commonwealth (1951) 83 CLR 1. Edelman whole legislation can often be cast at a higher level of generality than the particular purposes of its disparate parts327. The Foreign Influence Transparency Scheme Bill 2017 (Cth) ("the FITS Bill") was introduced in December 2017 as part of a package of three Bills, two introduced in the House of Representatives and one in the Senate. They were introduced following statements by the Director-General of the Australian Security Intelligence Organisation that "the threat from espionage and foreign interference is 'unprecedented'"328. When introducing one of the Bills into the House of Representatives, the then Prime Minister said that any one of the three pieces of legislation "would mark an enormous improvement in our ability to counter foreign interference" and that they were "interlocking components. All are important and none will fully succeed without the others."329 The two Bills that were considered "cognately"330 by the House of Representatives were the National Security Legislation Amendment (Espionage and Foreign Interference) Bill 2017 (Cth) and the FITS Bill. The third Bill, introduced in the Senate, was the Electoral Legislation Amendment (Electoral Funding and Disclosure Reform) Bill 2017 (Cth). Together, the three Bills were part of a "Counter Foreign Interference Strategy", with four pillars: sunlight, enforcement, deterrence, and capability. Of these four core purposes in the cognate legislation, "sunlight is at the very centre"331. That object of "sunlight", or transparency, was set out in s 3 of the FITS Act as the basis for "a scheme for the registration of persons who undertake certain activities on behalf of foreign governments and other foreign principals, in order to improve the transparency of their activities on behalf of those foreign principals". Descending to the particularity of the communications activity provision, item 3 of the table in s 21(1), the Revised Explanatory Memorandum to the FITS Bill said that it was "essential that there is transparency" for communications 327 Unions NSW v New South Wales (2019) 264 CLR 595 at 657 [172]. 328 Australia, House of Representatives, Parliamentary Debates (Hansard), 7 December 2017 at 13148. 329 Australia, House of Representatives, Parliamentary Debates (Hansard), 7 December 2017 at 13149. 330 Australia, House of Representatives, Parliamentary Debates (Hansard), 26 June 2018 at 6351-6352. 331 Australia, House of Representatives, Parliamentary Debates (Hansard), 7 December 2017 at 13148. Edelman activity on behalf of a foreign principal to allow "the person, the public or a section of the public to assess the interests which are being represented by the person undertaking the communications activity"332. That transparency is needed because333: "Decision-makers in the Australian Government and the public should know what interests are being advanced in respect of a particular decision or process. However, it is difficult to assess the interests of foreign actors when they use intermediaries to advance their interests through activities such as lobbying or communication of information or material. When the relationship between the foreign actor and the intermediary is concealed, the ability to assess the interests being brought to bear on a particular decision or process is limited and ultimately undermines the ability of the decision-maker and the public to evaluate and reach informed decisions on the basis of those representations." In short, the purpose of regulating registrable communications activity is to make transparent, to government decision-makers and to members of the public, the nature and extent of foreign interests that are involved in political communication. It does so by imposing a "spotlight of pitiless publicity"334. LibertyWorks properly accepted that this purpose was legitimate. As I explain later in these reasons, the purpose is not merely consistent with freedom of political communication, it is a purpose that reinforces the freedom despite doing so by burdening some political communication. The extent of the burden upon political communication There are a number of difficulties involved in the evaluation of the extent of a burden that is placed on political communication. One difficulty is that the evaluation sometimes depends upon reaching conclusions of fact, and the drawing of inferences, beyond the stated case but without the benefit of the usual rules of evidence335. Another difficulty with an overall assessment of the burden is that the evaluative process requires consideration of two different dimensions to a 332 Australia, Senate, Foreign Influence Transparency Scheme Bill 2017, Revised Explanatory Memorandum at 72 [401]. 333 Australia, Senate, Foreign Influence Transparency Scheme Bill 2017, Revised Explanatory Memorandum at 2 [3]. 334 Meese v Keene (1987) 481 US 465 at 487, quoting HR Rep No 1381, 75th Cong, 1st Sess (1937) at 2. 335 Commonwealth Freighters Pty Ltd v Sneddon (1959) 102 CLR 280 at 292. Edelman burden336. There is a dimension of breadth, which is concerned with the scope of the burden: how much political communication, between how many people, is affected by the law? There is also a dimension of depth, which is concerned with how deeply the burden is felt. An evaluation of the burden that a law places on political communication must be undertaken across the dimensions of both depth and breadth. For instance, a law which prohibited for ten years, by sanction of imprisonment, any political communication by Cabinet Ministers in favour of a particular political position on a single, narrow subject would affect only a tiny proportion of the Australian population and only a small subset of political communication. The breadth of the burden, based upon the number of people and extent of communication affected, might be found to be very narrow. But the depth of the burden might be found to be enormous. Breadth of the burden At first blush, the burden imposed by the communications activity provision and its associated provisions appears reasonably narrow. The burden extends only to those who communicate "on behalf of" a foreign principal and "for the purpose of political or governmental influence". If the words "on behalf of" in s 11 of the FITS Act were used in their well-established legal sense then the class of persons affected by the communications activity provision would be limited to those speakers who engaged in communications only as agents for foreign principals. But the concepts of "foreign principal" and "on behalf of" are defined in much broader terms. A "foreign principal", as defined in the FITS Act, is not merely a foreign government or a foreign government related entity in the ordinary sense of those terms. For instance, "foreign principal" extends also to any "foreign organisation that exists primarily to pursue political objectives"337 and any company in which such a foreign organisation holds more than 15% of the issued share capital338. It also extends to individuals within those organisations or companies, who are not 336 Clubb v Edwards (2019) 267 CLR 171 at 337-338 [480]. 337 FITS Act, s 10, definitions of "foreign principal" and "foreign political organisation". 338 FITS Act, s 10, definitions of "foreign principal", "foreign government related entity", and "foreign political organisation". Edelman Australian citizens or permanent Australian residents, who are obliged to act in accordance with the organisation's or company's directions339. As to the definition of "on behalf of" a foreign principal, as Steward J explains340, this definition is not confined to those who speak "on behalf of" foreign principals as agents in any true sense. The extended definition of "on behalf of"341 in the FITS Act includes undertaking an activity under an "arrangement of any kind, whether written or unwritten", and thus the literal terms of the definition extend beyond arrangements in the true sense of agency. That true sense describes authorised acts which change legal relations by being done on behalf of another person and for the benefit of, and thus attributable to, that other person342. By contrast, an act done "under" an "arrangement of any kind" is capable of extending to acts done under contract or even under "some consensus as to what is to be done"343. The FITS Act thus appears to redefine, and expand, the long-established concept of agency344. With the extended meanings of "foreign principal" and "on behalf of", and without any reading down or severance of those meanings, or disapplication of their operation, the regulation of registrable communications activity is not as 339 FITS Act, s 10, definitions of "foreign principal", "foreign government related entity", "foreign political organisation", and "foreign government related individual". 341 Especially s 11(1)(a)(i), read with s 10, definition of "arrangement". 342 Northern Land Council v Quall (2020) 94 ALJR 904 at 920 [77]; 383 ALR 378 at 397. See also Petersen v Moloney (1951) 84 CLR 91 at 94; International Harvester Co of Australia Pty Ltd v Carrigan's Hazeldene Pastoral Co (1958) 100 CLR 644 at 652; Scott v Davis (2000) 204 CLR 333 at 408 [227]; Australian Competition and Consumer Commission v Flight Centre Travel Group Ltd (2016) 261 CLR 203 at 215 [15]; Watts and Reynolds, Bowstead and Reynolds on Agency, 22nd ed 343 Country Care Group Pty Ltd v Director of Public Prosecutions (Cth) (2020) 275 FCR 342 at 354 [60]. 344 Compare the Foreign Agents Registration Act of 1938 (22 USC §§611-621), §611(c), and the criticisms of the expanded meaning given in Attorney General of the United States v Irish Northern Aid Committee (1982) 668 F 2d 159: Law, "The Foreign Agents Registration Act: A New Standard for Determining Agency" (1983) 6 Fordham International Law Journal 365. Edelman confined as the ordinary notion of "on behalf of a foreign principal" might suggest. Two examples can be given. One example concerns academic researchers. A conscious choice was made not to include them within the exemptions contained in Div 4 of Pt 2; no exemption was made for universities, academics, or research institutes345. The regulation of registrable communications activity might, therefore, extend to communications by academic researchers in Australia whose public research output is conducted with funding from any company in which more than 15% of the issued share capital is held by a foreign organisation that exists primarily to pursue political objectives346. If the funding of those communications meant that they were undertaken "under an arrangement" registrable communications activities if the academic had a substantial purpose to "affect in any way"347 a section of the public, such as an academic audience, in relation to processes in relation to a federal government decision348. they would be then Another example is that the regulation of registrable communications activity might extend to the same communications by a multinational company in Australia, again with a shareholder that exists primarily to pursue political objectives if the shareholder has more than 15% of the issued share capital. Or, it might extend to the same communications by a wholly Australian company that is acting under an "arrangement" within the meaning in s 10 with a foreign company that exists primarily to pursue political objectives. Here, the regulation extends to LibertyWorks, a private think-tank and an incorporated association349 advocating for libertarian political positions, which has an arrangement with the American Conservative Union, in the form of holding annual Conservative Political Action Conferences in Australia. Since LibertyWorks did not directly challenge the scope of the extended definition of "on behalf of", procedural fairness to the Commonwealth precludes this Court from considering whether the effect of that definition is an independent 345 Australia, Parliament, Parliamentary Joint Committee on Intelligence and Security, Advisory Report on the Foreign Influence Transparency Scheme Bill 2017 (2018) 346 FITS Act, s 10, definitions of "foreign principal", "foreign government related entity", and "foreign political organisation". 347 FITS Act, s 10, definition of "influence". 348 FITS Act, ss 12(1)(b), 12(2). 349 See Associations Incorporation Act 1981 (Qld), s 21. Edelman reason for invalidity and, if so, the effect that this would have on the remainder of the FITS Act. As Steward J observes, a consideration of whether the definition is an independent reason for invalidity would also require consideration of whether it could be read down to apply only to its usual common law sense, a possibility that I consider to be at least open by a restrictive reading of "under" in s 11(1)(a)(i)350. Procedural fairness thus requires that the breadth of operation of "on behalf of" falls to be considered only as part of the breadth of the burden imposed by the communications activity provision and its associated provisions. Apart from these expanded definitions, it is also relevant to the breadth of the burden imposed by the communications activity provision and its associated provisions that communications activity includes almost every sense of political communication by almost every means. As the Revised Explanatory Memorandum to the FITS Bill recognised, "communications activities can be very powerful in affecting the views and opinions of persons involved in Australia's political and governmental processes"351. And the regulation of communications activity targets both speakers and speech352. Depth of the burden: the nature and extent of disclosure required The depth of the burden prior to the communication, whilst significant, should not be overstated. The regulation of registrable communications activity under the FITS Act is not analogous with the United States notion of "prior restraint", a loose concept which has been said to provide an "impetus to distort doctrine in order to expand protection"353. The regulation of registrable communications activity does not "forbid" such activity354, nor does it restrain the activity by prohibiting its exercise without permission. It merely constrains political communication: there is nothing in the scheme under the FITS Act as it applies to registrable communications activity which directly or indirectly empowers any form of speech to be prohibited by anyone under any conditions. 350 See also FITS Act, ss 14(a), 14(b)(i). 351 Australia, Senate, Foreign Influence Transparency Scheme Bill 2017, Revised Explanatory Memorandum at 72 [401]. 352 See Citizens United v Federal Election Commission (2010) 558 US 310 at 341; National Institute of Family and Life Advocates v Becerra (2018) 138 S Ct 2361 353 Jeffries, "Rethinking Prior Restraint" (1983) 92 Yale Law Journal 409 at 420. 354 See Blackstone, Commentaries on the Laws of England (1769), bk 4, ch 11 Edelman Nevertheless, the burden has real depth. The regulation of registrable communications activity by the FITS Act places substantial constraints and deterrents upon that communication by requirements prior to, contemporaneous with, and subsequent to the communication, which all have a substantial deterrent effect. The application for registration, and any renewal, must be "accompanied by any information or documents required by the Secretary"355. There is also an obligation upon a person registered under the scheme to provide any information or documents required by the Secretary in order to correct any inaccuracy or misleading aspect of that information about which the person becomes aware356. Although some of those provisions were relied upon indirectly as part of the challenge by LibertyWorks to the scheme of registrable communications activity, no direct challenge was brought to those provisions on the basis that they imposed a burden that is not reasonably necessary. An answer to any such challenge, explained below, is that well-established principles of interpretation require the Secretary's power to be heavily confined. Even if the provisions did not require that confinement, as open-textured provisions with distributive application, the scope of any application which would not be reasonably necessary for the purposes of the FITS Act would be disapplied to that extent357 and, as Dixon J put it, the provisions would be "restricted" to their valid operation358. In any event, the burden upon political communication that is imposed by the powers of the Secretary should not be overstated. The only information or documents that the Secretary can require are those that are reasonably necessary for the Secretary to assess whether registration is required and to keep information on the register accurate. If "the general character of the statute" reveals that "powers were intended to be exercised only for a particular purpose, then the exercise of the powers not for such purpose but for some ulterior object will be 355 FITS Act, ss 16(2)(d), 39(2)(d). 356 FITS Act, s 34(3)(d). 357 Clubb v Edwards (2019) 267 CLR 171 at 317-318 [424], discussing Newcastle and Hunter River Steamship Co Ltd v Attorney-General for the Commonwealth (1921) 29 CLR 357. See also Bank of NSW v The Commonwealth (1948) 76 CLR 1 at 252. 358 Melbourne Corporation v The Commonwealth (1947) 74 CLR 31 at 76. See also Bank of NSW v The Commonwealth (1948) 76 CLR 1 at 369. Edelman invalid"359. Where the power is one to obtain information, the general character of a statute will define the purpose for which that information can be used360. Registration, which is at the core of the FITS Act, is plainly the "general character" of the statute. A request for information or documents by the Secretary under s 16(2)(d), s 34(3)(d) or s 39(2)(d) will be ultra vires if it is not necessary for assessing whether registration is required or whether registration information needs to be corrected. Whilst the extent of the required information is limited to the matters necessary for registration, the requirement to disclose that information to the Secretary is capable of operating as a real constraint on political communication. The information required to be produced might include, for example, details of any arrangements with a foreign principal, shareholdings of a company, the persons to whom a communication is going to be made, the content of the communication, and the purposes for which the communication is to be made. The information sought by the Secretary must be produced even if it might tend to incriminate the person or expose them to a penalty, although individuals have a derivative use immunity361. The information can be provided by the Secretary to any agency concerned with the protection of public revenue as well as a long list of "enforcement bodies", which include the Australian Federal Police, the Integrity Commissioner, the Australian Crime Commission, the Immigration Department, the Australian Securities and Investments Commission, and State and Territory police forces362. Although there are no facts before the Court concerning the extent to which persons might be deterred from political communication by the prospects of use of such information, and therefore any such assessment can only be evaluated in an abstract way, I would assess the deterrent effect as significant. The burden on political communication is deepened by obligations during the communication and after registrable communications activity, a disclosure about the foreign principal must be made in the communication. During 359 Brownells Ltd v Ironmongers' Wages Board (1950) 81 CLR 108 at 120. See also R v Toohey; Ex parte Northern Land Council (1981) 151 CLR 170 at 186-187; Walton v Gardiner (1993) 177 CLR 378 at 409. 360 Johns v Australian Securities Commission (1993) 178 CLR 408 at 424. See also at 436, 453, 458, 468. See, further, Katsuno v The Queen (1999) 199 CLR 40 at 57 [24]; Smethurst v Commissioner of Australian Federal Police (2020) 94 ALJR 502 at 521 [55]-[56], 539 [151]-[152]; 376 ALR 575 at 589-590, 613-614. 361 FITS Act, s 47. 362 FITS Act, s 53, read with Privacy Act 1988 (Cth), s 6(1), definition of "enforcement body". Edelman the form and manner prescribed by the rules made for the purposes of s 38(2)363. And, after the registrable communications activity, the person making the communication is required to report any material changes in circumstances364 and to keep records while registered under the scheme, and for three years after registration ends, of the following: any registrable activities undertaken "on behalf of" the foreign principal; any benefits provided to the person by the foreign information or material forming part of any registrable principal; any communications activity in relation to the foreign principal; any registrable arrangement between the person and the foreign principal; and other information communicated or distributed to the public or a section of the public in Australia on behalf of the foreign principal365. These constraints upon communication are further deepened by substantial sanctions for not complying with various provisions in their operation upon registrable communications activity. The relevant provisions relied upon by LibertyWorks – ss 16, 18, 34, 37, and 39 – concern the requirements to register, report registrable communications activity, and renew registration. Failure to apply for or to renew registration under the scheme carries maximum penalties of between 12 months' and fulfil responsibilities under the scheme carries maximum penalties of a fine of $13,320367. Failure to comply with a notice requiring information carries a maximum penalty of six months' imprisonment368. five years' The non-public nature of some information on the register During oral argument, one aspect of the FITS Act raised by the Court as potentially imposing a burden upon political communication was the maintenance of information provided to the Secretary on a non-public register. The Court queried whether there was a gap between, on the one hand, the information maintained by the Secretary on a register in relation to communications activity and, on the other hand, the information that is to be made publicly available on a website. If so, one issue that arises is the extent of that gap and another, albeit 363 Foreign Influence Transparency Scheme (Disclosure in Communications Activity) Rules 2018 (Cth). 364 FITS Act, s 34. 365 FITS Act, ss 40(1), 40(2). 366 FITS Act, s 57. 367 FITS Act, s 58. 368 FITS Act, s 59. Edelman without any agreed facts before the Court, is the deterrent effect of such a gap on political communication. It can be accepted that the more information that can be required to be disclosed by the Secretary and the larger the gap between the information contained on the register (which the Secretary can disclose to many enforcement agencies) and the information on the website, the greater the deterrent effect of registration and the more significant the burden will be upon political communication. Although questions of extent might be difficult to assess in other than such a relative manner, it is not difficult to draw an inference that people will be substantially less likely to communicate if the effect of doing so is that a large private dossier about them will be compiled and maintained by government. But the FITS Act does not have that effect. One reason that the FITS Act cannot result in a large private dossier of information about persons being held on a government register is the existence of constraints upon the power of the Secretary to obtain information, as discussed above. Another is the answer by the Solicitor-General of the Commonwealth when this issue was raised by the Court: that it is questionable whether there is any significant gap between, on the one hand, the information kept on the register by the Secretary and, on the other hand, the information that is made available to the public on a website. Senior counsel for LibertyWorks also accepted that there might not be any gap between the register kept by the Secretary and the public website. The information that is required to be made available to the public on a website, by s 43, is limited to the name of the person and the foreign principal, a description of the kind of registrable activities the person undertakes or undertook on behalf of the foreign principal, and any information prescribed by the rules for the purposes of s 43(1)(c)369. At first glance, this information appears to be considerably narrower than the information that the Secretary is required, by s 42, to maintain on a register. The register must also contain the application for registration, any renewals of the registration and information concerning material changes in circumstances, other communications between the person and the Secretary, and "any other information or documents the Secretary considers appropriate"370, the latter of which can only be information and documents considered appropriate for the purposes of the registration. Although there appears to be a gap between the information on the register and the information on the public website, this gap is no more than the concomitant of the administrative process that is necessary for appropriate information to be 369 Foreign Influence Transparency Scheme Rules 2018 (Cth), s 6. See also s 6A. 370 FITS Act, s 42(2)(g). Edelman made available to the public. The information prescribed by s 42 to be contained on the register provides the substratum for the information required to be included on the public website for transparency, including the type of information which would be expected to be, and is, required by the rules. Such information includes: the type of foreign principal involved; in some circumstances, a description of the relationship between the person and the foreign principal; and the date or period over which, and any arrangement, order or direction by which, the person undertakes, has undertaken or proposes to undertake the registrable activities371. For the website to serve its intended function as a clear and transparent repository of information, it cannot simply be the site of an information dump. An administrative process is necessary to filter the relevant information from the application for registration, renewals, and information concerning changes in circumstances. The source documents and information on the register will need to be transformed into clear, readable information on the public website. The filtering process will also need to exclude various categories of information, prescribed in s 43(2) of the FITS Act, including: (i) information that is commercially sensitive; (ii) information that affects national security; and (iii) information that is prescribed by rules to be excluded for other reasons. Once the information is filtered in this way, the website will be likely to reflect, at least in summary, all of the information on the register. But there remains an obvious need for that information, and the source documents, to remain on the register: to allow the register to be checked for any disputes about accuracy; and to allow the public information to be updated or corrected, including in the performance of the Secretary's powers to request information relating to material changes in circumstances or renewal of registration372. This was the understanding of the Attorney-General's Department of the intended operation of these powers in the FITS Bill when it said, as recorded in the Advisory Report on the Foreign Influence Transparency Scheme Bill ("the Advisory Report"), that it was "intended that information collected ... is placed on the public website as soon as practicable"373. This interpretation is consistent with the purpose of the communications activity provision and its associated provisions: to make transparent, to government decision-makers and members of the public, the nature and extent of 371 Foreign Influence Transparency Scheme Rules 2018 (Cth), ss 6(k), 6(m), 6(n), 6(o). 372 FITS Act, ss 34(3)(d), 39(2)(d). 373 Australia, Parliament, Parliamentary Joint Committee on Intelligence and Security, Advisory Report on the Foreign Influence Transparency Scheme Bill 2017 (2018) Edelman foreign interests that are involved in political communication in Australia. But even if this interpretation were not the best interpretation of the provisions concerning the register and website, ss 42 and 43, there might be a simple answer to any challenge brought to those provisions on the basis of any alleged gap that might exist between, on the one hand, the category of information required by s 42(2)(g) to be maintained on the register and, on the other hand, the information to be included on the public website. That answer might be that the relevant paragraph of s 42(2) could be severed from the operation of s 42 by applying s 15A of the Acts Interpretation Act. It would be hard to see, for instance, how the removal from the register of information that is not required to ensure transparency could undermine the FITS Act. However, since no direct challenge was brought to s 42 or s 43, it is unnecessary to consider this issue further. Analogies with the effect of United States legislation It is almost always unhelpful to rely upon United States First Amendment decisions for the purposes of assessing the constitutional validity of Australian legislation. There is a significant difference between, on the one hand, the individual, or "private"374, freedom from abridgement of speech expressly guaranteed by the First Amendment to the United States Constitution375 and, on the other hand, the public freedom in Australia from Commonwealth or State legislation that imposes unjustified burdens upon political communication, impliedly guaranteed by the Constitution. In other words, the different freedoms are derived in different manners from different provisions enacted in different contexts in different constitutions. One recent, stark example of a difference in the legal approaches is the constitutional restrictions in relation to safe access zones recognised by this Court compared with those recognised by the Supreme Court of the United States376. Nevertheless, where laws are expressed in broadly similar terms, comparative United States jurisprudence can assist by identifying the effect that the laws can have in burdening political communication. The United States experience of effect in relation to broadly similar laws can assist an Australian court to consider the breadth and depth of a burden upon political communication in Australia. This is particularly so in circumstances such as the present where the FITS Act was drafted following the recommendation of the Advisory Report, 374 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 567. 375 Including any abridgement in State legislation, when the First Amendment is read with the Fourteenth Amendment. 376 Clubb v Edwards (2019) 267 CLR 171 at 338-339 [483], citing McCullen v Coakley Edelman which had considered "the merit of creating a legislative regime based on the United States' Foreign Agents Registration Act 1938" and developed the FITS Bill after close consultation with the Attorney-General's Department's "counterparts in the United States"377. Although care must still be taken when considering the effects of similar legislation in the different circumstances of another country, one basis for an expectation that the FITS Act would have at least the same effect is that, as Appendix C to the Advisory Report reveals, the FITS Act was intended in some respects to have wider operation and to confer greater powers of enforcement than the United States legislation378. Like the FITS Act, the Foreign Agents Registration Act of 1938379 in the United States ("the FARA") does not prohibit any political communication. A report prepared by the Committee on the Judiciary of the United States House of Representatives explained the purpose of the FARA in the following way: "Our National Food and Drug Act requires the proper labeling of various articles, and safeguards the American public in the field of health. This bill seeks only to do the same thing in a different field, that of political propaganda."380 On the other hand, it has been observed by some that the FARA is far from benign in its actual effect. It has been argued that the FARA imposes a significant burden on political communication as it can be and has been "weaponized", as is said to have also occurred in relation to similar legislation in Russia and Hungary, by using the stigmatising label of "foreign agent" and using "the burdens of registration to punish dissenting or controversial views"381. Commentators have thus written of 377 Australia, Parliament, Parliamentary Joint Committee on Intelligence and Security, Advisory Report on the Foreign Influence Transparency Scheme Bill 2017 (2018) 378 Australia, Parliament, Parliamentary Joint Committee on Intelligence and Security, Advisory Report on the Foreign Influence Transparency Scheme Bill 2017 (2018), Appendix C, Table 3.1. 379 22 USC §§611-621. 380 See Getmanenko, "Freedom from the Press: Why the Federal Propaganda Prohibition Act of 2005 is a Good Idea" (2009) 114 Penn State Law Review 251 381 Robinson, "'Foreign Agents' in an Interconnected World: FARA and the Weaponization of Transparency" (2020) 69 Duke Law Journal 1075 at 1081. Edelman the dangers of the use of the FARA to "provide the basis for far-reaching inquiries"382. Such alleged effects could reflect a great depth of burden upon political communication383. Ultimately, however, for two reasons in combination there is insufficient basis to infer that these effects will exist in the application of the FITS Act. First, the FITS Act is generally facially neutral in its application to political communication: many of the provisions regulating registrable communications activity are expressed as duties that apply to all affected persons, independent of the content of the political communication. Secondly, although there are aspects of the operation of the FITS Act related to registrable communications activity that may have some capacity for application in a way which discriminates according to different types of communication – such as the powers of the Secretary to obtain information in order to fulfil the purposes of the FITS Act – the public nature of information displayed on the website about persons other than the person alleging discriminatory application might readily be expected to expose any discriminatory, and ultra vires, application of those powers. Justification of the burden At the risk of repetition, it is necessary to reiterate the case advanced by LibertyWorks. That case, clearly stated in oral submissions, centred upon the validity of the communications activity provision, item 3 of the table in s 21(1). Thus, apart from definitions provisions, the only provisions challenged by LibertyWorks384 were those concerned with the requirements to register, to report, and to renew registration in respect of registrable communications activity, and with the criminal sanctions for failure to do so. Other provisions were relied upon only to illustrate the operation of that aspect of the scheme and to demonstrate the extent of its burden on political communication. The Commonwealth was not called upon to answer any direct case based on invalidity of other aspects of the scheme. Suitability The scheme established by the FITS Act, backed by criminal penalties, requiring a person who undertakes registrable communications activity to register, report, and renew registration is plainly rationally connected with the purpose of 382 Roth, "The First Amendment in the Foreign Affairs Realm: 'Domesticating' the Restrictions on Citizen Participation" (1993) 2 Temple Political & Civil Rights Law Review 255 at 264. 383 Compare Clubb v Edwards (2019) 267 CLR 171 at 338 [481]. 384 See fn 312 above. Edelman making transparent, to government decision-makers and members of the public, the nature and extent of foreign interests that are involved in political communication in Australia. LibertyWorks submitted that the regulation of registrable communications activity was not rationally connected with the purpose of the FITS Act because there was no covert or otherwise clandestine aspect of the arrangement between LibertyWorks and the American Conservative Union, nor was there any financial aspect to the arrangement between them concerning the conference. Thus, it was submitted, the registration scheme as it applies to registrable communications activity involves overreach. One difficulty with LibertyWorks' submission is that it sought to assess the suitability of the scheme by reference to its individual circumstances, rather than the operation of the scheme generally. But more fundamentally, considerations of overreach are irrelevant to this stage of the structured proportionality analysis385. Considerations that might suggest overreach are part of the assessment of whether the means adopted were reasonably necessary. They are not part of the assessment of suitability. Even provisions which apply their purpose in an overreaching manner are, almost by definition, rationally connected with their purpose. Reasonable necessity Since LibertyWorks' sole focus was upon invalidity of the communications activity provision, with other provisions relied upon only consequentially, LibertyWorks neither pleaded nor made any written or oral submissions that the particular definition of "on behalf of" in s 11, or the particular powers of the Secretary to obtain information or documents in ss 16 and 34, were not reasonably necessary to achieve the purposes of the regulation of registrable communications activity. LibertyWorks' argument, on an all-or-nothing basis, was that the entire regime regulating registrable communications activity was not reasonably necessary. LibertyWorks' submissions about reasonable necessity were short and clear. They were effectively that the regulation of registrable communications activity was not reasonably necessary because there were obvious and compelling alternative means of achieving the purpose to the same extent but with considerably less burden upon political communication. The alternatives were said to be either: (i) the provision, already existing in s 38386, for disclosure of the foreign principal at the time of communication; or (ii) the creation of an exemption from the communications activity regime if disclosure is made under s 38. No 385 Comcare v Banerji (2019) 267 CLR 373 at 452 [192]. 386 Read with the Foreign Influence Transparency Scheme (Disclosure Communications Activity) Rules 2018 (Cth). Edelman other alternatives were explored by LibertyWorks or the Court for any replacement of the communications activity regime. The problem with LibertyWorks' submissions is that its proposed alternatives would fall far short of achieving to the same extent the purpose of making transparent, to government decision-makers and members of the public, the nature and extent of foreign interests that are involved in political communication in Australia. The alternatives would simply provide disclosure to the recipients of the communication. They would not provide disclosure to the general public either before or after the communication. The examples given by the Solicitor-General of illustration: communications to the recipients in a foreign language newspaper or in a private Facebook group which disclose the relationship with the foreign principal would not have the prophylactic effects of avoiding sinister foreign influence and disclosing other foreign influence if registration were not required. the Commonwealth are a good Adequacy in the balance LibertyWorks also submitted, albeit faintly, that the regulation of registrable communications activity was not adequate in the balance in light of the burden that it imposed on political communication. The submission was not, and could not have been, pressed with any enthusiasm. The purpose of the regulation of communications activity – to make transparent the nature and extent of foreign interests that are involved in political communication – allows the political process to operate openly and with better government and public information about influences. It also acts as a prophylactic to any sinister foreign influence on Australian political processes in circumstances of a growing global trend of foreign influence operations occurring at what the Australian Security Intelligence Organisation described as "an unprecedented scale". It is not merely that the purpose is one of great importance and of the highest public policy. The purpose also reflects and reinforces the very constitutional value that supports the implied freedom of political communication. The burden imposed here might deter some, but does not prohibit, political communication. Thus, there is no merit in any submission that this is the sort of trivial purpose that is so grossly outweighed by the burden on political communication that even reasonably necessary means to achieve that purpose are not justified. Conclusion The questions in the special case should be answered in the manner proposed by Kiefel CJ, Keane and Gleeson JJ. STEWARD J. I agree with the answers given by Kiefel CJ, Keane and Gleeson JJ to the questions stated for the opinion of the Court in this special case, largely for the reasons their Honours give. However, on balance, that is subject to the following three observations. First, I accept that the three stages of structured proportionality387 can, in a given case, be used as analytical tools to test whether a given law is reasonably appropriate and adapted in the advancement of its purpose. Its deployment to determine the outcome of this case is apt. Secondly, had it been raised by the plaintiff, I may well have decided that s 11(1)(a)(i) of the Foreign Influence Transparency Scheme Act 2018 (Cth) ("the FITS Act"), which addresses arrangements entered into with foreign principals, represents, when applied by item 3 of the table in s 21(1) of the FITS Act, an impermissible burden on the freedom of communication about matters of government and politics, which this Court has implied from the Constitution ("the implied freedom"). However, as the plaintiff ultimately made no such claim and, in the end, limited its case to an attack on item 3 of the table in s 21(1) of the FITS Act, it would be inappropriate to make any such decision. But the matter was raised in argument and it comprises an important issue about the reach of the FITS Act which should be highlighted. Thirdly, for my part, and with the greatest of respect, it is arguable that the implied freedom does not exist. It may not be sufficiently supported by the text, structure and context of the Constitution and, because of the continued division within this Court about the application of the doctrine of structured proportionality, it is still not yet settled law. The division within the Court over so important an issue may justify a reconsideration of the implication itself. In that respect, it is one thing to proclaim the necessity of a freedom of political discourse given the type of representative and responsible government created by the Constitution; it is another thing entirely to make an implication about when and how that freedom may be legitimately limited. The continued division in this Court about how that latter task is to be undertaken is telling. It may suggest that the implied freedom cannot be adequately defined. However, no party submitted that the implied freedom did not exist. In such circumstances, it is my current duty to continue to apply it faithfully. Any consideration of the existence of the implied freedom should, if necessary, be a matter for full argument on another occasion. In amplification of the last two propositions only, and because of the importance of the issues which confronted this Court, I make the following further remarks. 387 McCloy v New South Wales (2015) 257 CLR 178 at 193-195 [2] per French CJ, Kiefel, Bell and Keane JJ. The FITS Act and "an arrangement" My concern about the inclusion of "an arrangement" in the definition of when a person is acting "on behalf of" a foreign principal, in s 11 of the FITS Act, is important because that inclusion leads to individuals and organisations being liable to be registered under the FITS Act when they are only ever truly acting on their own behalf. That seems to be the position of the plaintiff here, for reasons given below. To explain this, it is necessary to set out some historical background. The Foreign Agents Registration Act In 1938, the United States Congress enacted the Foreign Agents Registration Act388 ("the FARA"). Subject to exemptions, the FARA requires agents of foreign principals (defined to include the government of a foreign country and a foreign political party) to file a registration statement with the United States Attorney General389. Unless so registered, a person cannot act as an agent of a foreign principal390. A wilful violation of the FARA is a criminal offence391. In the Supreme Court of the United States decision of Viereck v United States, Stone CJ explained the object of the FARA in the following terms392: "The Act of 1938 requiring registration of agents for foreign principals was a new type of legislation adopted in the critical period before the outbreak of the war. The general purpose of the legislation was to identify agents of foreign principals who might engage in subversive acts or in spreading foreign propaganda, and to require them to make public record of the nature of their employment. But the means adopted to accomplish that end are defined by the statute itself, which, as will presently appear more in detail, followed the recommendations of a House Committee which had investigated foreign propaganda. These means included the requirement of registration of agents for foreign principals – with which it appears that petitioner complied – and the requirement that 388 22 USC §§611-621. 389 22 USC §§611, 612. 390 22 USC §612. 391 22 USC §618. 392 (1943) 318 US 236 at 241. the registrant give certain information concerning his activities as such agent." The definition of "agent of a foreign principal" in the FARA is instructive. It refers to a person who engages in various types of political activities in a particular capacity. That capacity is, for the most part, when any person "acts as an agent, representative, employee, or servant, or [when] any person ... acts in any other capacity at the order, request, or under the direction or control, of a foreign principal or of a person any of whose activities are directly or indirectly supervised, directed, controlled, financed, or subsidized in whole or in major part by a foreign principal"393. Importantly, the FARA does not apply to arrangements entered into with a foreign principal more generally; it also does not apply to a person who is not acting for a foreign principal but is instead only acting for themselves. In the United States District Court decision of United States v Peace Information Center394, the defendant had been charged under the FARA for failing to register as an agent of a foreign principal. Amongst other things, the defendant contended that the FARA breached the First Amendment to the Constitution of the United States. That argument was rejected. Judge Holtzoff observed that the FARA neither limited nor interfered with freedom of speech; it merely required persons carrying on certain activities to identify themselves by filing a registration statement395. In reaching this conclusion, Judge Holtzoff was influenced by an earlier observation of Vinson CJ in the Supreme Court decision of American Communications Assn v Douds396 that, in the context of the First Amendment, it had long been established that freedom of speech itself depends on the power of constitutional government to survive: "[i]f [constitutional government] is to survive it must have power to protect itself against unlawful conduct and, under some circumstances, against incitements to commit unlawful acts"397. 393 22 USC §611(c)(1). 394 (1951) 97 F Supp 255 (DCDC). 395 (1951) 97 F Supp 255 (DCDC) at 262. 397 (1950) 339 US 382 at 394. Earlier, in Viereck, Black J in dissent also observed that the FARA "implements rather than detracts from the prized freedoms guaranteed by the First Amendment"398. Of course, the freedom of speech that is guaranteed by the First Amendment to the Constitution of the United States is not the same as the implied freedom. The former is a personal right; the latter is a limitation on law making399. However, authorities concerning the First Amendment are not necessarily inutile. In 2018, the Federal Parliament passed the FITS Act. It was inspired by the FARA. Indeed, an Advisory Report on the Foreign Influence Transparency Scheme Bill 2017 (Cth) ("the FITS Bill") prepared by the Parliamentary Joint Committee on Intelligence and Security in June 2018 reveals that in developing the FITS Bill, public servants within the Attorney-General's Department ("the Department") had closely consulted with their counterparts in the United States "to avoid ... challenges and limitations of [the] FARA in meeting its objective"400. A table comparing the FARA provisions and the provisions contained in the FITS Bill constitutes Appendix C to that Advisory Report. Like the FARA, the FITS Act establishes a comprehensive regime for the registration of individuals and entities that engage in a variety of political activities "on behalf of" foreign principals. The phrase "on behalf of" is defined in s 11 of the FITS Act and is important for reasons that will become apparent. The two enactments serve, at least in part, a similar object and purpose. The FITS Bill was presented to Parliament at the same time as the Bill which became the National Security Legislation Amendment (Espionage and Foreign Interference) Act 2018 (Cth) ("the EFI Act"), which relevantly enacted, within Pt 5.2 of the Criminal Code (Cth), a new range of offences designed to attack the threat of spying and foreign interference. A further Bill, also introduced at the same time, became the Electoral Legislation Amendment (Electoral Funding and Disclosure Reform) Act 2018 (Cth), which relevantly prohibits donations from foreign governments and state-owned enterprises being used to finance public debate and prohibits other regulated political actors from using donations from foreign sources to fund reportable political expenditure. Each of these Acts may 398 (1943) 318 US 236 at 251. 399 Comcare v Banerji (2019) 267 CLR 373 at 394-396 [19]-[20] per Kiefel CJ, Bell, Keane and Nettle JJ, 434 [135] per Gordon J. 400 Parliamentary Joint Committee on Intelligence and Security, Advisory Report on the Foreign Influence Transparency Scheme Bill 2017 (June 2018) at 35 [2.115]. be seen as complementary in purpose. As the Attorney-General said in the Second Reading Speech for the first two mentioned Bills401: "Deception has always been at the heart of espionage, and so transparency is the evergreen counterintelligence to propaganda. So it is that this legislative combination of new foreign interference offences and a register to make transparent the links of Australian advocacy to foreign principals brings Australian counterintelligence laws into the modern age." The FITS Act and the intermediary As Kiefel CJ, Keane and Gleeson JJ explain402, the Commonwealth's submission that the true purpose of the FITS Act is to minimise the risk of foreign principals exerting undisclosed influence upon the integrity of Australia's political or election processes should be accepted as accurate. The object and purpose of the FITS Act is not concerned with the content of any communication or lobbying or attempt to influence. Rather, as the Commonwealth submitted, it is concerned with the mode or method of certain types of communication. In that respect, the Commonwealth emphasised that the FITS Act places no fetter whatsoever on a foreign principal's ability to communicate. It is only, it was said, if a communication is made through an intermediary that the Act is engaged. The emphasis on a person being an "intermediary" as a trigger point for the application of the FITS Act is borne out by the FITS Bill Revised Explanatory Memorandum, which states403: "Decision-makers in the Australian Government and the public should know what interests are being advanced in respect of a particular decision or process. However, it is difficult to assess the interests of foreign actors when they use intermediaries to advance their interests through activities such as lobbying or communication of information or material. When the relationship between the foreign actor and the intermediary is concealed, the ability to assess the interests being brought to bear on a particular decision or process is limited and ultimately undermines the ability of the decision-maker and the public to evaluate and reach informed decisions on the basis of those representations." 401 Australia, House of Representatives, Parliamentary Debates (Hansard), 26 June 403 Australia, Senate, Foreign Influence Transparency Scheme Bill 2017, Revised Explanatory Memorandum at 2 [3]. However, s 11 of the FITS Act defines the term "on behalf of" a foreign principal very much more broadly as follows: "Undertaking activity on behalf of a foreign principal (1) A person undertakes an activity on behalf of a foreign principal if: the person undertakes the activity in any of the following circumstances: under an arrangement with the foreign principal; in the service of the foreign principal; (iii) on the order or at the request of the foreign principal; under the direction of the foreign principal; and at the time the arrangement or service is entered into, or the order, request or direction made, both the person and the foreign principal knew or expected that: the person would or might undertake the activity; and the person would or might do so in circumstances set out in section 20, 21, 22 or 23 (whether or not the parties expressly considered the existence of the scheme)." Section 11(2) provides that it does not matter whether consideration is payable for the purposes of s 11(1). Relevantly, s 10 defines the terms "arrangement", "foreign political organisation" and "foreign principal" as follows: "arrangement includes a contract, agreement, understanding or other arrangement of any kind, whether written or unwritten. foreign political organisation includes: a foreign organisation that exists primarily to pursue political objectives. foreign principal means: a foreign government; a foreign government related entity; a foreign political organisation; a foreign government related individual." Acting "in the service of" a foreign principal, or "on the order or at the request of" a foreign principal, or "under the direction of" a foreign principal, may each constitute conventional examples of acting on behalf of another. But acting "under an arrangement" may or may not involve a person acting on behalf of or for another or as an intermediary. Self-evidently, the inclusion within the definition here of an "arrangement" entered into between a person and a foreign principal was intended to attack attempts to avoid the more orthodox relationships of agency as identified in s 11(1)(a)(ii), (iii) and (iv). But sometimes legislative caution can perhaps go too far and lead to unintended consequences. As already mentioned, there is no equivalent inclusion of "arrangements" in the FARA and, I should add, no equivalent language directed at arrangements with foreign principals may be found in the offences created by the EFI Act. The definition of an "arrangement" is broad, and in my view arguably extends to occasions when a person does not in fact act for another, but instead wholly for themselves. In other statutory contexts, an arrangement has been said to exist where there exists "an element of reciprocal commitment even though it may not be legally enforceable"404. It ordinarily requires some "meeting of the minds" of the parties405. However, an arrangement involves more than a mere hope or expectation that each party will act in accordance with its terms406. Here, in my 404 Australian Competition and Consumer Commission v Channel Seven Brisbane Pty Ltd (2009) 239 CLR 305 at 322 [48] per French CJ and Kiefel J. 405 Country Care Group Pty Ltd v Director of Public Prosecutions (Cth) (2020) 275 FCR 342 at 353-354 [60] per Allsop CJ, Wigney and Abraham JJ. 406 Australian Competition and Consumer Commission v Channel Seven Brisbane Pty Ltd (2009) 239 CLR 305 at 322 [48] per French CJ and Kiefel J, citing Australian Competition and Consumer Commission v Leahy Petroleum Pty Ltd (2007) 160 FCR 321 at 334-335 [35]-[37] per Gray J; Apco Service Stations Pty Ltd v Australian Competition and Consumer Commission (2005) 159 FCR 452 at 464 [46] per Heerey, Hely and Gyles JJ; Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at 257-258 [79] per Whitlam, Sackville and view, the reference to an arrangement in s 11(1)(a)(i) appears not to be confined to synthetic or de facto examples of agency. As defined, the term does not necessarily connote any form of agency and perhaps cannot be so read down. There are no controlling words used in the definition of "arrangement" directed at the use in some way by a foreign principal of an Australian intermediary. The requirement of intention and expectation on the part of the foreign principal and the person, set out in s 11(1)(b), probably does not supply such words. Moreover, the very notions of being an intermediary or agent are arguably of themselves too imprecise in nature to justify a court reading down the broad language used in the definition of an "arrangement" so that it conforms with what is said to have been what Parliament really had in mind. Finally, there is no indication in the various Explanatory Memoranda that accompanied the FITS Bill of a legislative intention to curb the breadth of that definition. The potential extensive reach of the FITS Act, arguably achieved by the inclusion of s 11(1)(a)(i), may be seen in the basal obligation to register in s 16 with respect to communications activities for the purposes of item 3 of the table in s 21(1)407. A person must apply for registration if the person "becomes liable to register under the scheme in relation to a foreign principal" and is not already so registered. Pursuant to s 18, a person relevantly becomes liable to register if that person "undertakes an activity on behalf of a foreign principal that is registrable in relation to the foreign principal". Division 3 of Pt 2 of the FITS Act identifies what activities are registrable. It includes, pursuant to item 3 of the table in s 21(1), a "[c]ommunications activity ... for the purpose of political or governmental influence". Section 13 defines what is a "communications activity". It includes the communication or distribution of information or material to the public. Section 13(3) contains an important exemption for certain activities, including those undertaken "in the ordinary course of [a] disseminator's business" and which involve communicating or distributing information or material produced by another person, whose identity is apparent in the communication or distribution. Gyles JJ; Australian Competition and Consumer Commission v Amcor Printing Papers Group Ltd (2000) 169 ALR 344 at 360 [75] per Sackville J; Trade Practices Commission v Service Station Association Ltd (1993) 44 FCR 206 at 230-231 per Lockhart J, Spender and Lee JJ agreeing; Trade Practices Commission v Email Ltd (1980) 43 FLR 383 at 385-386 per Lockhart J; Trade Practices Commission v Nicholas Enterprises Pty Ltd [No 2] (1979) 40 FLR 83 at 89-90 per Fisher J; Top Performance Motors Pty Ltd v Ira Berk (Queensland) Pty Ltd (1975) 24 FLR 286 at 290-292 per Smithers J. 407 The other obligations are described by Kiefel CJ, Keane and Gleeson JJ at [36]-[38]. Section 12 of the FITS Act defines when an activity is undertaken for the purpose of "political or governmental influence". It includes an activity if the "sole or primary purpose, or a substantial purpose" is to influence "a process in relation to a federal government decision". Section 12(4) elaborates on what sort of decision is intended to be caught. It includes a decision of "any kind in relation to any matter, including administrative, legislative and policy matters ... whether or not the decision is final". The word "influence" is defined broadly in s 10 of the FITS Act to include "affect in any way". Here the plaintiff accepted that the 2019 Conservative Political Action Conference ("CPAC"), discussed further below, involved the undertaking of communications activities for the purpose of political or governmental influence. It follows that, if a person undertakes a communications activity for the purpose of "political or governmental influence" "on behalf of" a foreign principal, then that person is liable to be registered. A person will undertake such an activity "on behalf of" a foreign principal if, relevantly, the person does so "under an arrangement with the foreign principal" and at the time the arrangement is entered into both that person and the foreign principal "knew or expected" that the person would undertake that activity for the purpose of political or governmental influence408. The word "under" connotes a necessary causal relationship between the activity and the existence of an arrangement. As noted in the reasons of Kiefel CJ, Keane and Gleeson JJ409, the FITS Act creates a number of offences that can apply to registrants, potential registrants and those who undertake registrable communications activities. It would seem that no part of the foregoing statutory regime, as it applies to arrangements, necessarily requires the person undertaking the activity to be acting in fact at the behest of, or on behalf of, a foreign principal or as some kind of intermediary. A person, for example, might enter into an arrangement to collaborate with a foreign principal, on equal terms, to make a submission to government concerning a matter of public policy. A person might form an equal alliance with a foreign principal to pursue a commonly held political point of view. A person might jointly host a conference with a foreign principal concerning political or governmental issues. Each of these activities might well constitute registrable activities. In each case, the person in Australia may be independently advancing their own interests, thereby acting solely for themselves. In each case also, the requirement in s 11(1)(b) of the FITS Act for joint knowledge or expectation concerning the proposed activity would not necessarily prevent the activity from being liable to be registered. 408 FITS Act, s 11(1)(b). The Solicitor-General of the Commonwealth agreed with the foregoing. He did not suggest that the definition of "arrangement" should be in any way read down. He did not seek to rely on s 15A of the Acts Interpretation Act 1901 (Cth). He agreed that a person, acting wholly in his or her interests, could be caught by the FITS Act if he or she had entered into an "arrangement" with a foreign principal (on the assumption that the other requirements of that Act are fulfilled). On that basis, an Australian academic who prepares a paper (that constitutes a communications activity for the purpose of political or governmental influence) under an arrangement or understanding (perhaps to deliver the paper at an international conference) with a foreign academic (who is a foreign principal) who proposes to prepare her or his own paper might be liable to be registered. The Solicitor-General submitted that this was a necessary by-product of important legislation which is broad-based and neutral. He submitted, however, that only a very small number of people might be caught this way. Appearing as intervener, the Solicitor-General for New South Wales submitted that the term "arrangement" in s 11(1)(a)(i) should be read down by reference to the words "on behalf of" in s 11(1). With very great respect, I cannot agree with that particular submission; "[i]t would be quite circular to construe the words of a definition by reference to the term defined"410. Was the plaintiff an intermediary? The agreed facts of this case appear to bear out the foregoing and may be illustrative of how the FITS Act might apply to a person acting in their own interests. The plaintiff is a private "think tank" which aims to move public policy in the direction of increased individual rights and freedoms, and a reduction in governmental control over all individuals' personal and economic lives. The American Conservative Union ("the ACU") is an American corporation established for the promotion of political freedom and for the purpose of influencing politics and politicians in the United States. It was not disputed that the ACU was and is a "foreign political organisation" for the purposes of the FITS Act. The ACU holds an annual conference – the CPAC – in the United States at which talks are given by prominent people in politics, media, arts, sports and academia. The plaintiff wanted to hold a CPAC with the ACU in Australia in 2019, and so an oral agreement to collaborate for that purpose was reached. The plaintiff organised this event, and was responsible for all running and venue costs, scheduling and liaising with all Australian and many overseas speakers and 410 Owners of "Shin Kobe Maru" v Empire Shipping Co Inc (1994) 181 CLR 404 at 419 per Mason CJ, Brennan, Deane, Dawson, Toohey, Gaudron and McHugh JJ, citing Wacal Developments Pty Ltd v Realty Developments Pty Ltd (1978) 140 CLR 503. attendees. The speakers included politicians, media personalities, members of think tanks, economists and social commentators. In promotional material, the ACU was advertised as one of the "Think Tank Host Partners" of the CPAC and described as one of the "co-hosts" in a newspaper article. The ACU facilitated the attendance of some overseas speakers, and some members of the ACU also attended. The CPAC was held in August 2019. Prior to the conference being held in 2019, the plaintiff received a letter from an officer of the Department. The letter recited that the Department was aware of the upcoming CPAC, was of the view that the ACU was a foreign political organisation and therefore a foreign principal, and was of the view that the CPAC appeared to constitute a communications activity for the purposes of political or governmental influence. The letter invited the plaintiff to consider whether it needed to register under the FITS Act. On 21 October 2019, a notice was sent to the plaintiff by the Department obliging the plaintiff to produce, pursuant to s 45(2) of the FITS Act, any information or documents relevant to the question of whether the plaintiff is liable to register because of its relationship with the ACU. The notice stated that the information would include, but not be limited to, the following: "Any agreement, contract or other document detailing any understanding or arrangement between [the plaintiff] and the ACU Any invitations, letters or other correspondence from [the plaintiff] or the ACU sent to individuals invited to speak at or attend the Conference, including correspondence subsequent to the initial invitation Copies, transcripts or video or audio recordings of speeches made by speakers at the conference, including of speeches by members of [the plaintiff] or the ACU to introduce or conclude the Conference or a specific day or event at the conference Summaries of the topics covered by speakers at the Conference, and Material produced or distributed by [the plaintiff] promoting the Conference or the ACU." Section 45(2) of the FITS Act empowers the Secretary of the Department to obtain by notice "any information that may satisfy the Secretary as to whether [a] person is liable to register in relation to [a] foreign principal" if the Secretary "reasonably suspects that [the] person might be liable to register under the scheme in relation to [the] foreign principal" and the person is not so registered411. Section 59 relevantly provides that it is an offence not to comply with a notice issued pursuant to s 45. The plaintiff declined to comply with the notice on the ground that it was invalid. The Department decided not to take any further action because, whilst it was of the view that the plaintiff may have had registration obligations in relation to the ACU and the CPAC, it was also satisfied that the arrangement between the plaintiff and the ACU was "made transparent" through statements to the media and promotional materials. At the time it agreed the facts of this case with the Commonwealth, the plaintiff was planning to hold another CPAC, in November 2020, with the ACU as a "Think Tank Partner", but the plaintiff expected that COVID-19 restrictions would prevent anyone from the ACU from physically attending the conference. Two speakers from the 2019 CPAC had expressed by telephone a reluctance to participate in the 2020 CPAC given the possibility of correspondence having to be made public pursuant to the FITS Act. There is no suggestion from the agreed facts that the plaintiff has ever undertaken communications activities on behalf of, or at the behest of, the ACU, or that any of the speakers at the 2019 CPAC made speeches on behalf of anyone else or that anybody was an intermediary for the ACU. As the promotional material and other media communications made clear, the 2019 CPAC was jointly hosted by the plaintiff and the ACU. Nonetheless, in my view, the collaboration that took place between the plaintiff and the ACU fell within the ordinary meaning of the words used in the definition of an "arrangement" in s 10 of the FITS Act. Given, as noted above, that it was not disputed that the ACU is a foreign principal and that it appears to have been accepted that the CPAC constituted a communications activity for the purposes of political or governmental influence, it follows that the plaintiff was liable to be registered under the FITS Act. The implied freedom and an "arrangement" under the FITS Act I generally agree with the reasons of Kiefel CJ, Keane and Gleeson JJ concerning the application of the test expressed in McCloy v New South Wales412 ("the McCloy test") to item 3 of the table in s 21(1) of the FITS Act and to the FITS Act more generally. The FITS Act falls within that category of laws identified by 411 FITS Act, s 45(1). 412 (2015) 257 CLR 178 at 193-195 [2] per French CJ, Kiefel, Bell and Keane JJ. Vinson CJ in Douds as being necessary precisely because, if a democratic government is to endure, it must have the power to protect itself against unlawful conduct or corrupting influences413. Such a law, as Black J observed in Viereck, ultimately promotes freedom of political expression414. And as Brennan J (as his Honour then was) has recognised, "the salutary effect of freedom of political discussion on performance in public office can be neutralized by covert influences"415. Nonetheless, I am less confident that the FITS Act will deter only a very small proportion of persons from making political communications. For my part, however, what is critical here is that it was an agreed fact that at the time of the enactment of the FITS Act, Australia was experiencing undisclosed foreign influence in respect of government and political systems and processes and more broadly in the Australian community. It was agreed that the Australian Security Intelligence Organisation ("ASIO") had identified foreign powers clandestinely seeking to shape the opinions of members of the Australian public, media organisations and government officials to advance their own countries' political objectives, including through the recruitment and co-opting of influential and powerful Australian voices to lobby decision makers. It was further agreed that ASIO's view was that espionage and foreign interference activity against Australia's interests was "occurring at an unprecedented scale". Based upon such agreed facts, it should be accepted that the judicial branch of government is not well equipped to invalidate Parliament's solution to this threat as being, for example, not suitable, necessary and adequate in its balance. That is especially so given that national security and the maintenance of the Commonwealth is at issue; in such cases there must necessarily be a very large measure of judicial deference in determining the reach of the implied freedom416. For the purposes of applying the McCloy test, as helpfully distilled by the plurality in Clubb v Edwards417, the Commonwealth admitted that the obligation to register under the FITS Act creates a burden on the implied freedom, albeit one that was said to be "modest". The plaintiff then accepted that the purpose of the FITS Act is compatible with the maintenance of the constitutionally prescribed 413 (1950) 339 US 382 at 394. 414 (1943) 318 US 236 at 251. 415 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 416 cf Harisiades v Shaughnessy (1952) 342 US 580. 417 (2019) 267 CLR 171 at 186 [5] per Kiefel CJ, Bell and Keane JJ. system of representative and responsible government. As to the test of structured proportionality, the plaintiff also conceded that the FITS Act is "suitable" because it exhibits a rational connection to its purpose418. I otherwise generally agree with the reasons given by Kiefel CJ, Keane and Gleeson JJ419 in relation to the two other limbs of structured proportionality as applied to item 3 of the table in s 21(1) of the FITS Act. However, as I have explained, the FITS Act may oblige an individual to register, in the circumstances described above, when she or he may truly be acting only on behalf of her- or himself, ostensibly contrary to the very express object and purpose of that Act. That raises for consideration whether the inclusion of the word "arrangement", as an instance of when a person may be seen to be undertaking an activity "on behalf of" a foreign principal, itself offends the implied freedom in so far as it is applied for the purposes of item 3 of the table in s 21(1). For that purpose, I accept, applying the second limb of the McCloy test, that the inclusion – because, I infer, it is concerned with avoidance arrangements – is compatible with the maintenance of the constitutionally prescribed system of representative and responsible government. That leaves the third limb of the McCloy test and its concern with a law's suitability, necessity and adequacy in its balance. For the moment, it can be properly assumed that s 11(1)(a)(i), in so far as it is engaged when applying item 3 of the table in s 21(1) of the FITS Act, is both a suitable and necessary law in the required senses420. That is because I accept that the concept of an "arrangement" provides a means of capturing those foreign principals who seek covert influence by ways which avoid s 11(1)(a)(ii), (iii) and (iv)421; it is also because no party 418 Comcare v Banerji (2019) 267 CLR 373 at 400 [33] per Kiefel CJ, Bell, Keane and Nettle JJ, citing Tajjour v New South Wales (2014) 254 CLR 508 at 563 [81]-[82] per Hayne J; McCloy v New South Wales (2015) 257 CLR 178 at 217 [80] per French CJ, Kiefel, Bell and Keane JJ, 232-233 [132]-[133] per Gageler J, 262 [234] per Nettle J; Brown v Tasmania (2017) 261 CLR 328 at 370 [132]-[133] per Kiefel CJ, Bell and Keane JJ, 418 [281] per Nettle J; Clubb v Edwards (2019) 267 CLR 171 at 186 [6] per Kiefel CJ, Bell and Keane JJ, 264 [266(2)] per Nettle J, 330- 331 [463] per Edelman J. 420 Clubb v Edwards (2019) 267 CLR 171 at 186 [6] per Kiefel CJ, Bell and Keane JJ. 421 Comcare v Banerji (2019) 267 CLR 373 at 408 [53] per suggested that there is an obvious and compelling alternative means of addressing foreign principals who so act422. This leaves the issue of adequacy in the balance. Adequacy in the balance It has been said that a law which is found to be suitable and necessary may nonetheless impermissibly burden the implied freedom if "the benefit sought to be achieved by the law is manifestly outweighed by its adverse effect on the implied freedom"423. In other words, the question is "whether the law imposes a burden on the implied freedom which is 'manifestly excessive by comparison to the demands of legitimate purpose'"424. The inquiry is not a comparison of the benefits of the law with the benefits of an unburdened implied freedom, but a comparison of the effects of the law and the extent of the burden425. An overreach of means over ends may well demonstrate an excessive burden on the implied freedom which is disproportionate to the purpose or object of the impugned law426. In that respect, a "manifestly" excessive burden on the implied freedom is, in my view, a reference to a legislative means of achieving a legitimate purpose that is so extreme in its 422 Clubb v Edwards (2019) 267 CLR 171 at 186 [6] per Kiefel CJ, Bell and Keane JJ. 423 Comcare v Banerji (2019) 267 CLR 373 at 402-403 [38] per Kiefel CJ, Bell, Keane and Nettle JJ, citing Clubb v Edwards (2019) 267 CLR 171 at 186 [6], 199-200 [66]- [69], 209 [102] per Kiefel CJ, Bell and Keane JJ, 266-269 [270]-[275] per Nettle J, 344 [497]-[498] per Edelman J. See also Davis v The Commonwealth (1988) 166 CLR 79 at 99-100 per Mason CJ, Deane and Gaudron JJ (Wilson and Dawson JJ agreeing at 101); Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 30-31, 34 per Mason CJ, 78 per Deane and Toohey JJ, 94-95 per Gaudron J, 101-102 per McHugh J; Cunliffe v The Commonwealth (1994) 182 CLR 272 at 324 per Brennan J; McCloy v New South Wales (2015) 257 CLR 178 at 219 [87], 220 [91] per French CJ, Kiefel, Bell and Keane JJ; Brown v Tasmania (2017) 261 CLR 328 at 422-423 [290] per Nettle J. 424 Clubb v Edwards (2019) 267 CLR 171 at 200 [69] per Kiefel CJ, Bell and Keane JJ, citing Brown v Tasmania (2017) 261 CLR 328 at 422-423 [290] per Nettle J and McCloy v New South Wales (2015) 257 CLR 178 at 219-220 [89]-[92] per French CJ, Kiefel, Bell and Keane JJ. 425 Clubb v Edwards (2019) 267 CLR 171 at 201 [72] per Kiefel CJ, Bell and Keane JJ. 426 Brown v Tasmania (2017) 261 CLR 328 at 365 [109] per Kiefel CJ, Bell and effect on that freedom that it cannot, in any sensible way, be justified. The hurdle to be jumped is very high. As Nettle J observed in Brown v Tasmania427: "[I]n the Australian constitutional context the description 'adequate in its balance' is better understood as an outer limit beyond which the extent of the burden on the implied freedom of political communication presents as manifestly excessive by comparison to the demands of legitimate purpose". In Clubb, Edelman J emphasised that a conclusion that a law is inadequate in the balance after nevertheless making a finding that the law has a legitimate purpose "could have large consequences"428. As a result, as his Honour pointed out, in some other jurisdictions this test has been effectively abandoned429. This limb of structured proportionality should, accordingly, be approached with very considerable trepidation. The agreed facts of this case illustrate, and only illustrate, the difficulty with the inclusion of s 11(1)(a)(i) in the FITS Act. They do not suggest that the plaintiff was in any way an agent of the ACU or in any way doing the ACU's bidding when holding the 2019 CPAC. As far as one can tell, the plaintiff has acted in its own right at all times in organising and hosting the CPAC. It did so with the collaboration and co-operation of the ACU. The ACU was, in that respect, apparently an equal partner. The plaintiff was in no way any kind of intermediary for the ACU. It follows that it is unlikely that any object or purpose of the FITS Act was fulfilled, or in any way enhanced, by making the plaintiff liable to be registered. Given the breadth of the definition of "arrangement", contrary to the submission of the Commonwealth, the position of the plaintiff may not be unique. For example, there was material before us from the Department requiring one former prime minister, who was to attend merely as a speaker at the 2019 CPAC, to consider registration. More broadly, as already mentioned, the FITS Act arguably has the capacity to require registration by any person who might organise a conference with a foreign principal at which political communications are to take place; it might also apply to collaboration between local and overseas academics in relation to political communications. Other potential examples of its reach might include international law and accounting firms who might lobby in their own right 427 (2017) 261 CLR 328 at 422 [290], citing McCloy v New South Wales (2015) 257 CLR 178 at 219-220 [89]-[92] per French CJ, Kiefel, Bell and Keane JJ; Kiefel, "Section 92: Markets, Protectionism and Proportionality – Australian and European Perspectives" (2010) 36(2) Monash University Law Review 1 at 12. 428 Clubb v Edwards (2019) 267 CLR 171 at 341-342 [492]. 429 Clubb v Edwards (2019) 267 CLR 171 at 342 [493]. the government from time to time; and it might apply to companies in joint ventures with foreign principals. In each of these examples the local individual or entity may not in any way be acting as an intermediary for a foreign principal. Whether this aspect of the FITS Act will affect only a small number of Australians is not known to me. No list of currently registered individuals or entities was before the Court. However, the foregoing reasoning suggests that there is a potential for application on many occasions. It follows that if s 11(1)(a)(i) of the FITS Act is a valid law, in so far as it is engaged by item 3 of the table in s 21(1), such individuals or entities, as described above, may be obliged to register for no reason whatsoever connected with the object and purpose of the FITS Act. No one has suggested that Parliament, in any way, intended that Australians undertaking political activities in their own interests needed to register or make disclosures of any kind pursuant to the FITS Act. The FITS Act, by s 3, proclaims that its object is to improve the transparency of activities undertaken on behalf of foreign principals. The Commonwealth states that the object of the Act is the minimisation of undisclosed foreign influence on political affairs. But if a person does not truly act for a foreign principal, there is no need for transparency; there is no covert source of foreign influence to disclose. It follows that it is arguable that the extension of the FITS Act to those with nothing relevantly to disclose, to those who have nothing relevantly to hide, and to those who act only for themselves, but who, in each case, are nonetheless associated with a foreign principal by participation in an arrangement, is a manifestly disproportionate legislative solution to the aim of minimising undisclosed foreign political influence. The disproportion may be said to be manifest because it treats the innocent as if they are guilty of being undisclosed intermediaries for a foreign principal. That conclusion may well be strengthened when one considers the obligations imposed, on pain of potential imprisonment, on registrants, potential registrants and those who undertake registrable communications activities. The disproportion here is arguably so stark that it overcomes any necessary judicial deference concerning matters of national security. In other words, it is arguable that by reason of s 11(1)(a)(i) of the FITS Act when applied by item 3 of the table in s 21(1) of that Act, the extent of the burden on the implied freedom presents, to use the language of Nettle J, "as manifestly excessive by comparison to the demands of legitimate purpose"430; the legitimate purpose here being to address unacceptable arrangements with foreign principals 430 Brown v Tasmania (2017) 261 CLR 328 at 422 [290], citing McCloy v New South Wales (2015) 257 CLR 178 at 219-220 [89]-[92] per French CJ, Kiefel, Bell and Keane JJ; Kiefel, "Section 92: Markets, Protectionism and Proportionality – Australian and European Perspectives" (2010) 36(2) Monash University Law Review 1 at 12. that fall outside the reach of s 11(1)(a)(ii), (iii) and (iv). For the reasons already given, it may not be possible to read down the term "arrangement" to save it from invalidity431. However, I express no final view. The plaintiff did not contend for invalidity on this specific basis. If necessary, the reach of s 11(1)(a)(i) may be considered on another occasion. The existence of the implied freedom The divergence of views in this Court concerning the test for the application of the implied freedom perhaps may illustrate the tenuous nature of that implication. If the content of the implied freedom cannot even now be agreed upon, then, for my part, that may demonstrate that it was never justified. In Theophanous v Herald & Weekly Times Ltd, Dawson J rejected the existence of the implied freedom and said432: "Whilst it may disappoint some to find that the Australian Constitution provides no guarantee, express or implied, of freedom of speech, that is because those who framed the Constitution considered it to be one of the virtues of representative government that no such guarantee was needed. I have elsewhere dealt with the manner in which the founding fathers placed their faith in the democratic process rather than constitutional guarantees to secure those freedoms regarded as fundamental in any democratic society433. They took the view that constitutional guarantees operate as a fetter upon the democratic process and did not consider it necessary to restrict the power of Parliament to regulate those liberties which the common law recognizes and nurtures. If a constitutional guarantee of freedom of speech or of communication is to be implied, the implication must be drawn from outside the Constitution by reference to some such concept as 'the nature of 431 cf Knight v Victoria (2017) 261 CLR 306 at 324-325 [32]-[33] per Kiefel CJ, Bell, Gageler, Keane, Nettle, Gordon and Edelman JJ; Clubb v Edwards (2019) 267 CLR 171 at 192-193 [32]-[36] per Kiefel CJ, Bell and Keane JJ, 216-217 [135]-[138] per Gageler J, 248-249 [230] per Nettle J, 287 [329] per Gordon J. 432 (1994) 182 CLR 104 at 193-194. 433 See Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 186; and see also at 133-134 per Mason CJ. our society'434. That is not an implication which can be drawn consistently with established principles of interpretation. The Engineers' Case435 may have given rise to the misconception that no implications may be drawn from the Constitution and to have led to some imbalance in the interpretation of the federal division of powers436. But it is now clear that implications can and must be drawn in the interpretation of the Constitution to give effect to its intention437. However, it has never been thought that the implications which might properly be drawn are other than those which are necessary or obvious having regard to the express provisions of the Constitution itself. To draw an implication from extrinsic sources, which the first defendant's argument necessarily entails, would be to take a gigantic leap away from the Engineers' Case, guided only by personal preconceptions of what the Constitution should, rather than does, contain. It would be wrong to make that leap." I am afraid that I still respectfully agree with much of the foregoing. The grave importance of the freedom to speak about political and governmental issues to a democratic society is undeniable. But whilst implying a legal guarantee of such freedom from the text and structure of the Constitution may be understandable, that text and structure may not supply a clear answer for when and how that freedom may permissibly be limited. The daunting search for a unifying principle of limitation is yet to uncover a principle that has been agreed upon by the Justices of this Court. It may not clearly be found in the text and structure of the Constitution; nor, as Dawson J observed, can it be found outside the Constitution. If that is so, then it may be that it cannot be found at all. So concluding does not deny, for example, the ability of this Court to protect the means by which representatives are "directly chosen" by the people for the purposes of ss 7 and 24 of the Constitution. As Dawson J recognised in Australian Capital Television Pty Ltd v The Commonwealth, legislation which, for example, 434 See, eg, McGraw-Hinds (Aust) Pty Ltd v Smith (1979) 144 CLR 633 at 670 per 435 Amalgamated Society of Engineers v Adelaide Steamship Co Ltd (1920) 28 CLR 436 See, eg, Craven, "The Crisis of Constitutional Literalism in Australia", in Lee and Winterton (eds), Australian Constitutional Perspectives (1992) 1 at 4-9. 437 See West v Commissioner of Taxation (NSW) (1937) 56 CLR 657 at 681-682 per purported to have the effect of denying electors access to information necessary for the exercise of a true choice in an election would be incompatible with the Constitution438. On one view, the implication has, since its birth, been a source of uncertainty. Perhaps, and subject to the Constitution, if a law exhibits a sufficient connection with a head of constitutional power, that is enough439; it may be better for its reasonableness and legitimacy to be otherwise matters reserved to the legislative branch of government440. I am not the only Justice of this Court who has been concerned about the implied freedom. Callinan J was critical of its existence in Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd441, as was Heydon J in Monis v The Queen442. There is no need at this stage to set out what each of these Justices said. The current division of opinion in this Court may, in my view, justify a reconsideration, with leave if necessary, of the existence of the implied freedom. Nonetheless, as already mentioned, neither party challenged the existence of the implied freedom in this special case. For the disposition of this proceeding, it is therefore not appropriate to deny its application here. It should, if required, be a matter for full argument to be considered on another occasion. Conclusion I agree with the answers to the stated questions proposed by Kiefel CJ, 438 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 187. See also Goldsworthy, "Constitutional Implications Revisited" (2011) 30 University of Queensland Law Journal 9 at 28-29. 439 cf Plaintiff M68/2015 v Minister for Immigration and Border Protection (2016) 257 CLR 42 at 80 [77] per Bell J, citing Plaintiff S156/2013 v Minister for Immigration and Border Protection (2014) 254 CLR 28 at 43 [26]. See also Grain Pool of Western Australia v The Commonwealth (2000) 202 CLR 479 at 492 [16] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ; New South Wales v The Commonwealth (2006) 229 CLR 1 at 143 [275] per Gleeson CJ, Gummow, Hayne, Heydon and Crennan JJ. 440 cf Gerner v Victoria (2020) 95 ALJR 107 at 112-113 [18] per Kiefel CJ, Gageler, Keane, Gordon and Edelman JJ; 385 ALR 394 at 399. 441 (2001) 208 CLR 199 at 330-339 [337]-[348]. 442 (2013) 249 CLR 92 at 181-184 [243]-[251].

HIGH COURT OF AUSTRALIA Matter No M46/2018 AND APPELLANT ALYCE EDWARDS & ANOR RESPONDENTS Matter No H2/2018 APPELLANT AND ELIZABETH AVERY & ANOR RESPONDENTS [2019] HCA 11 10 April 2019 M46/2018 & H2/2018 ORDER Matter No M46/2018 So much of the appellant's appeal from the judgment of Magistrate Bazzani made on 11 October 2017 as has been removed into this Court is dismissed. The appellant pay the respondents' costs. Matter No H2/2018 So much of the appellant's appeal from the judgment of Magistrate Rheinberger made on 27 July 2016 as has been removed into this Court is dismissed. The appellant pay the respondents' costs. On appeal from the Magistrates' Court of Victoria (M46/2018) and the Magistrates Court of Tasmania (H2/2018) Representation G O'L Reynolds SC with F C Brohier and D P Hume for the appellant in both matters (instructed by Khor & Burr Lawyers and DL Legal Lawyers) F L Dalziel with J M Davidson for the first respondent in M46/2018 (instructed by Director of Public Prosecutions (Vic)) K L Walker QC, Solicitor-General for the State of Victoria, with K E Foley and S Gory for the second respondent in M46/2018 and for the Attorney- General for the State of Victoria, intervening in H2/2018 (instructed by Victorian Government Solicitor) M E O'Farrell SC, Solicitor-General for the State of Tasmania, with S K Kay for the respondents in H2/2018 (instructed by Solicitor-General for Tasmania) S P Donaghue QC, Solicitor-General of the Commonwealth, with C L Lenehan and C G Winnett for the Commonwealth, intervening in both matters (instructed by Australian Government Solicitor) the Attorney-General of P J Dunning QC, Solicitor-General of the State of Queensland, with F J Nagorcka for the Attorney-General of the State of Queensland, intervening in both matters (instructed by Crown Solicitor (Qld)) C D Bleby SC, Solicitor-General for the State of South Australia, with P D Stirling for the Attorney-General for the State of South Australia, intervening in both matters (instructed by Crown Solicitor's Office (SA)) G T W Tannin SC with F B Seaward for the Attorney-General for the State of Western Australia, intervening in both matters (instructed by State Solicitor for Western Australia) J K Kirk SC with Z C Heger for the Attorney-General for the State of New South Wales, intervening in both matters (instructed by Crown Solicitor's Office (NSW)) T J Moses for the Attorney-General for the Northern Territory, intervening in H2/2018 (instructed by the Solicitor-General for the Northern Territory) The Castan Centre for Human Rights Law, The Fertility Control Clinic (A firm) and The Human Rights Law Centre appearing as amici curiae in M46/2018, each limited to its written submissions LibertyWorks Inc appearing as amicus curiae in H2/2018, limited to its written submissions Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Constitutional law (Cth) – Implied freedom of communication about governmental or political matters – Where s 185D of Public Health and Wellbeing Act 2008 (Vic) and s 9(2) of Reproductive Health (Access to Terminations) Act 2013 (Tas) prohibit certain communications and activities in relation to abortions within access zone of 150 m radius around premises at which abortions are provided – Where appellants engaged in communications and activities to abortions within access zone – Whether communications and activities in relation to abortions are communications about governmental and political matters – Whether provisions effectively burden implied freedom – Whether provisions imposed for legitimate purpose – Whether provisions reasonably appropriate and adapted to that purpose – Whether provisions suitable, necessary and adequate in balance. in relation Constitutional law (Cth) – Implied freedom of communication about governmental or political matters – Severance, reading down and disapplication – Where appellant charged and convicted of offence against s 185D of Public Health and Wellbeing Act 2008 (Vic) – Where it was not contended that appellant's conduct involved political communication – Where substantial overlap with issues raised in proceedings in relation to interstate Act – Whether s 185D able to be severed, read down or partially disapplied so as to have valid operation in respect of appellant – Whether appropriate to proceed to determine constitutional validity of s 185D. Words and phrases – "access zone", "adequate in its balance", "calibration", "compatible with the maintenance of the constitutionally prescribed system of representative and responsible government", "compelling purpose", "dignity", "discriminatory", "legitimate purpose", "necessary", "partial disapplication", "political communication", "privacy", "prohibited behaviour", "proportionality testing", "protest", "rational connection", "reading down", "reasonably appropriate and adapted", "safe access zone", "severance", "structured proportionality", "suitable", "undue burden", "viewpoint neutral". Interpretation of Legislation Act 1984 (Vic), s 6. Public Health and Wellbeing Act 2008 (Vic), ss 185A, 185B, 185C, 185D, 185E. Reproductive Health (Access to Terminations) Act 2013 (Tas), s 9. KIEFEL CJ, BELL AND KEANE JJ. The Parliaments of the States of Victoria and Tasmania have decriminalised the termination of pregnancies by artificial means in certain circumstances1. In addition, the legislature of each State has sought to provide that those seeking access to, or working in, premises where terminations are available are protected from hindrance. In Matter M46 of 2018 ("the Clubb appeal"), the appellant, Mrs Kathleen Clubb, challenges the validity of s 185D of the Public Health and Wellbeing Act 2008 (Vic) ("the Public Health Act"), which, by virtue of the definition of "prohibited behaviour" in s 185B(1), prohibits, in certain circumstances, "communicating by any means in relation to abortions". Section 185D was inserted into the Public Health Act by the Public Health and Wellbeing Amendment (Safe Access Zones) Act 2015 (Vic) ("the Safe Access Zones Act"). In Matter H2 of 2018 ("the Preston appeal"), the appellant, Mr John Graham Preston, challenges the validity of s 9(2) of the Reproductive Health (Access to Terminations) Act 2013 (Tas) ("the Reproductive Health Act"), which, by virtue of the definition of "prohibited behaviour" in s 9(1), prohibits, in certain circumstances, "a protest in relation to terminations". Each of the appellants argues that the challenged provision is invalid because it impermissibly burdens the freedom of communication about matters of government and politics which is implied in the Constitution ("the implied freedom"). This argument falls to be resolved by application of the test for invalidity stated in Lange v Australian Broadcasting Corporation2 as explained in McCloy v New South Wales3 and Brown v Tasmania4. The test to be applied was adopted in McCloy by French CJ, Kiefel, Bell and Keane JJ5, and it was applied in Brown by Kiefel CJ, Bell and Keane JJ6 and 1 Abortion Law Reform Act 2008 (Vic); Reproductive Health (Access Terminations) Act 2013 (Tas). (1997) 189 CLR 520; [1997] HCA 25. (2015) 257 CLR 178; [2015] HCA 34. (2017) 261 CLR 328; [2017] HCA 43. (2015) 257 CLR 178 at 193-195 [2]. (2017) 261 CLR 328 at 363-364 [104]. Bell Nettle J7. For convenience that test will be referred to as "the McCloy test". It is in the following terms8: Does the law effectively burden the implied freedom in its terms, operation or effect? If "yes" to question 1, is the purpose of the law legitimate, in the sense that it is compatible with the maintenance of the constitutionally prescribed system of representative and responsible government? If "yes" to question 2, is the law reasonably appropriate and adapted to advance that legitimate object in a manner that is compatible with the maintenance of the constitutionally prescribed system of representative and responsible government? The third step of the McCloy test is assisted by a proportionality analysis which asks whether the impugned law is "suitable", in the sense that it has a rational connection to the purpose of the law, and "necessary", in the sense that there is no obvious and compelling alternative, reasonably practical, means of achieving the same purpose which has a less burdensome effect on the implied freedom. If both these questions are answered in the affirmative, the question is then whether the challenged law is "adequate in its balance". This last criterion requires a judgment, consistently with the limits of the judicial function, as to the balance between the importance of the purpose served by the law and the extent of the restriction it imposes on the implied freedom9. The appellants argued that the challenged laws fail to satisfy the McCloy test. In addition, they invited the Court to approach the question as to the validity of the challenged provisions on the footing that they derogate impermissibly from what their Senior Counsel described as the right to protest and demonstrate. This invitation cannot be accepted, for reasons that may be stated briefly. It is well settled that the implied freedom is a limitation upon the power of government to regulate communication relating to matters of government and politics. It does not confer a right to communicate a particular message in a (2017) 261 CLR 328 at 398 [236], 413 [271], 416-417 [277]-[278]. 8 McCloy v New South Wales (2015) 257 CLR 178 at 193-195 [2] as modified by Brown v Tasmania (2017) 261 CLR 328 at 363-364 [104]. See also (2017) 261 CLR 328 at 375-376 [155]-[156], 416 [277], 478 [481]. 9 McCloy v New South Wales (2015) 257 CLR 178 at 193-195 [2]-[3]. Bell particular way10. The common law right to protest or demonstrate may be abrogated by statute. The issue in each appeal is whether the statutory abrogation is valid. Senior Counsel for the appellants acknowledged in the course of argument that to accept his invitation would be contrary to the settled understanding in this Court's decisions. Notwithstanding that acknowledgment, he advanced no basis on which this Court might now adopt a different understanding of the juridical nature of the implied freedom, and so the invitation must be rejected. The statutory provision challenged in each appeal operates within a "safe access zone", which is the area within a radius of 150 m from premises at which terminations are provided. In each case, the restriction is confined to communications about terminations that are able to be seen or heard by a person seeking access to such premises. There is thus an overlap of issues that arise in the appeals. Accordingly, the convenient course is to deal comprehensively with those issues in the Clubb appeal, and then to address the different aspects of the issues that arise in the Preston appeal. The Clubb appeal The charge Mrs Clubb was charged in the Magistrates' Court of Victoria with the following offence: "[Mrs Clubb] at East Melbourne on the 4/8/16 did engage in prohibited behaviour namely communicating about abortions with persons accessing premises at which abortions are provided while within a safe access zone, in a way that is reasonably likely to cause anxiety or distress." On 4 August 2016, Mrs Clubb was seen by police to be standing at the eastern boundary of the East Melbourne Fertility Control Clinic ("the Clinic") 10 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 150; [1992] HCA 45; Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 560; Levy v Victoria (1997) 189 CLR 579 at 623-624, 625-626; [1997] HCA 31; Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 223-225 [107]-[112], 246-248 [184]-[188], 298 [337], 303-304 [354]; [2004] HCA 41; APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 451 [381]; [2005] HCA 44; Unions NSW v New South Wales (2013) 252 CLR 530 at 551-552 [30], 554 [36], 574 [119]; [2013] HCA 58; McCloy v New South Wales (2015) 257 CLR 178 at 202-203 [30]; Brown v Tasmania (2017) 261 CLR 328 at Bell shortly after 10 am. Mrs Clubb stood about 5 m from the entrance to the Clinic with pamphlets in her hand. At 10.30 am she approached a young couple entering the Clinic, spoke to them, and attempted to hand them a pamphlet. The young man declined the proffered pamphlet and moved, with the young woman, away from Mrs Clubb. The evidence did not establish what was said between Mrs Clubb and the young couple, but the pamphlet that Mrs Clubb proffered offered counselling and assistance to enable pregnancy to proceed to birth. The proceedings The Magistrate upheld the validity of the law under which Mrs Clubb was charged, concluding that it imposed no burden upon the implied freedom because the Public Health Act is not directed at political communication. The Magistrate found that Mrs Clubb communicated with the young couple for the sole purpose of a discussion relevant to abortion, and proceeded to convict Mrs Clubb of the offence charged. Mrs Clubb appealed to the Supreme Court of Victoria. In that Court, she advanced three grounds of appeal. On 23 March 2018, Gordon J, pursuant to s 40 of the Judiciary Act 1903 (Cth), ordered the removal of that part of the appeal concerned with two of those grounds into this Court. Mrs Clubb subsequently filed an amended notice of appeal in this Court. She now contends, in substance, that s 185D of the Public Health Act, read with para (b) of the definition of "prohibited behaviour" in s 185B(1), impermissibly burdens the implied freedom and is therefore invalid, so that the charge against her should have been dismissed. Legislation Part 9A of the Public Health Act is entitled "Safe access to premises at which abortions are provided". The purpose of Pt 9A is set out in s 185A, which provides: "The purpose of this Part is – to provide for safe access zones around premises at which abortions are provided so as to protect the safety and wellbeing and respect the privacy and dignity of – people accessing the services provided at those premises; and Bell employees and other persons who need to access those premises in the course of their duties and responsibilities; and to prohibit publication and distribution of certain recordings." "[A]bortion" is defined in s 185B(1) by reference to the Abortion Law Reform Act 2008 (Vic). That Act defines "abortion" in s 3: "abortion means intentionally causing the termination of a woman's pregnancy by – using an instrument; or using a drug or a combination of drugs; or any other means". Section 185C of the Public Health Act sets out the principles that apply to Pt 9A: "The following principles apply to this Part – the public is entitled to access health services, including abortions; the public, employees and other persons who need to access premises at which abortions are provided in the course of their duties and responsibilities should be able to enter and leave such premises without interference and in a manner which – protects the person's safety and wellbeing; and respects the person's privacy and dignity." The offence-creating provision in Pt 9A is s 185D, which provides: "A person must not engage in prohibited behaviour within a safe access zone. Penalty: 120 penalty units or imprisonment for a term not exceeding 12 months." "[S]afe access zone" is defined in s 185B(1) to mean "an area within a radius of 150 metres from premises at which abortions are provided". Bell "[P]rohibited behaviour" is defined in s 185B(1) to include: subject to subsection (2), communicating by any means in relation to abortions in a manner that is able to be seen or heard by a person accessing, attempting to access, or leaving premises at which abortions are provided and is reasonably likely to cause distress or anxiety". Sub-section (2) of s 185B provides that "[p]aragraph (b) of the definition of prohibited behaviour does not apply to an employee or other person who provides services at premises at which abortion services are provided". Section 185D, read with para (b) of the definition of "prohibited behaviour", will be referred to in these reasons as "the communication prohibition". "[P]rohibited behaviour" is also defined to mean: in relation to a person accessing, attempting to access, or leaving premises at which abortions are provided, besetting, harassing, intimidating, interfering with, threatening, hindering, obstructing or impeding that person by any means; or interfering with or impeding a footpath, road or vehicle, without reasonable excuse, in relation to premises at which abortions are provided; or intentionally recording by any means, without reasonable excuse, another person accessing, attempting to access, or leaving premises at which abortions are provided, without that other person's consent". Section 185E provides that a person must not, without the consent of the other person or without reasonable excuse, publish or distribute a recording of a person accessing, attempting to access, or leaving premises at which abortions are provided, if the recording contains particulars likely to lead to the identification of that other person and the identification of that other person as a person accessing premises at which abortions are provided. A threshold issue The Attorney-General of the proceeding pursuant to s 78A of the Judiciary Act, submitted that it would be the Commonwealth, intervening Bell inappropriate for this Court to determine whether the communication prohibition impermissibly burdens the implied freedom in the Clubb appeal because there is no evidence that Mrs Clubb's conduct actually involved political communication. It was argued that, although the evidence does not establish what Mrs Clubb actually said to the couple seeking access to the Clinic, it may be inferred that her conduct in proffering the pamphlet was directed solely at dissuading the young lady from having an abortion. On that basis, in its application to Mrs Clubb s 185D imposed no burden on the implied freedom. It was then said on behalf of the Attorney-General that, even if the communication prohibition were held to impermissibly burden the implied freedom in some areas of its application, the prohibition is to be construed in accordance with s 6(1) of the Interpretation of Legislation Act 1984 (Vic) so as not to apply to communications about governmental or political matters. Section 6(1), which mirrors s 15A of the Acts Interpretation Act 1901 (Cth), relevantly requires that every Act "shall be construed as operating to the full extent of, but so as not to exceed" legislative power: "to the intent that where a provision of an Act, or the application of any such provision to any person, subject-matter or circumstance, would, but for this section, have been construed as being in excess of that power, it shall nevertheless be a valid provision to the extent to which it is not in excess of that power". Construed in this way, the communication prohibition would be valid in its application to Mrs Clubb's conduct whether or not it might impermissibly burden the implied freedom in other areas of its application. Mrs Clubb resisted the Attorney-General's submission, arguing that this Court should hold that her communications were political in the requisite sense, and further that the communication prohibition could not be severed into valid and invalid areas of application. There is force in the submission of the Attorney-General. The implied freedom protects the exercise by the people of the Commonwealth of a free and informed choice as electors. A discussion between individuals of the moral or ethical choices to be made by a particular individual is not to be equated with discussion of the political choices to be made by the people of the Commonwealth as the sovereign political authority. That is so even where the Bell choice to be made by a particular individual may be politically controversial. In Cunliffe v The Commonwealth11, Brennan J (as he then was) said: "The immunity from legislative control which the Constitution implies in order to secure freedom of political discussion does not preclude the making of laws to control any activity the control of which might be politically controversial." In APLA Ltd v Legal Services Commissioner (NSW)12, Hayne J, referring to the observations of Brennan J in Cunliffe, explained that laws that seek to control "communications about events (actual or hypothetical) and about rights and remedies ... are not directed at communications about whether the happening of events should be regulated differently or whether available rights and remedies should be changed". In the present case, the communication effected by the handing over of the pamphlet by Mrs Clubb lacked any evident connection with the electoral choices to be made by the people of the Commonwealth. It was designed to persuade a recipient against having an abortion as a matter for the individual being addressed. It was not addressed to law or policy makers, nor did it encourage the recipient to vote against abortion or to take part in any public debate about the issue. It may therefore be accepted that the proscription of this communication did not involve an interference with the implied freedom. On behalf of the Attorney-General it was noted that in Knight v Victoria13 the Court unanimously reaffirmed that, as stated in Lambert v Weichelt14: "[i]t is not the practice of the Court to investigate and decide constitutional questions unless there exists a state of facts which makes it necessary to decide such a question in order to do justice in the given case and to determine the rights of the parties". 11 (1994) 182 CLR 272 at 329; [1994] HCA 44. 12 (2005) 224 CLR 322 at 451 [380]. See also at 350-351 [26]-[28], 403-404 13 (2017) 261 CLR 306 at 324 [32]; [2017] HCA 29. 14 (1954) 28 ALJ 282 at 283. Bell In Knight15, the Court declined to deal with a constitutional question which was hypothetical because it had not arisen and might never arise. The Court explained that16: "it is ordinarily inappropriate for the Court to be drawn into a consideration of whether a legislative provision would have an invalid operation in circumstances which have not arisen and which may never arise if the provision, if invalid in that operation, would be severable and otherwise valid". It is generally accepted that courts will not determine whether a statute contravenes a constitutional provision or guarantee unless it is necessary to secure and protect the rights of a party against an unwarranted exercise of legislative power17. That practice has been followed both in this Court and in the Supreme Court of the United States18. The practice is based upon prudential considerations19. It has been said that for the Court to proceed to determine the validity of a statute where a case does not require it may create the appearance of an "eagerness" that may detract from the Court's standing20. A further, and powerful, prudential consideration is that justice does not require the question to be resolved. These considerations do not detract from the understanding that whether a statute impermissibly burdens the implied freedom is not to be answered by reference to whether it limits the freedom on the facts of a particular case, but rather by reference to its effect more 15 (2017) 261 CLR 306 esp at 317 [6], 326 [37]. 16 (2017) 261 CLR 306 at 324 [33], citing British Medical Association v The Commonwealth (1949) 79 CLR 201 at 258; [1949] HCA 44 and Tajjour v New South Wales (2014) 254 CLR 508 at 585-589 [168]-[176]; [2014] HCA 35. 17 Universal Film Manufacturing Co (Australasia) Ltd v New South Wales (1927) 40 CLR 333 at 356; [1927] HCA 50. See also at 342, 350-351. 18 Attorney-General for NSW v Brewery Employes Union of NSW (1908) 6 CLR 469 at 590; [1908] HCA 94; Lambert v Weichelt (1954) 28 ALJ 282; Chicago & Grand Trunk Railway Co v Wellman (1892) 143 US 339 at 345. 19 Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 473 [249]; [2001] HCA 51. 20 Attorney-General for NSW v Brewery Employes Union of NSW (1908) 6 CLR 469 Bell generally21. As noted above, the implied freedom is not a personal right; it is to be understood as a restriction upon legislative power. It would ordinarily be inappropriate as a matter of practice for the Court to determine a question as to the validity of a statute by reference to the Constitution where doing justice in the case did not require it22. But the practice is "not a rigid rule to special circumstances"23. As was acknowledged on behalf of the Attorney-General, whether or not the Court should entertain Mrs Clubb's appeal is a matter for the Court. And while the Court will generally be astute to adhere to the practice, this case exhibits three unusual features which together warrant the Court dealing with the matter as an exception to its usual practice. law which cannot yield imposed by First, the line between speech directed towards agitating for legislative change, or changes in the attitude of the executive government to the administration of a law, and speech directed to the making of a moral choice by a citizen may be very fine where politically contentious issues are being discussed. Secondly, while it may be accepted that there is no intersection between the implied freedom and the facts of the Clubb appeal, it cannot be said that the question may never arise. The likelihood of the question arising is obvious; indeed, the Solicitor-General of the Commonwealth was not disposed to argue that the Preston appeal does not involve political communication. Finally, if Mrs Clubb's contentions in relation to the invalidity of the communication prohibition were to be accepted, she would be entitled, subject to the possibility of the prohibition being applied so as to give it a valid operation in respect of non-political speech, to have her conviction set aside. Mrs Clubb disputed the contention that the prohibition can properly be applied in a way that does not exceed the power of the Victorian Parliament to regulate non-political communication. And so, considerations of judicial economy do not strongly favour adhering to the practice in this case. That is because it would be necessary for the Court finally to resolve this dispute in favour of the view advanced by the Solicitor-General of the Commonwealth in order to uphold his threshold submission. 21 Unions NSW v New South Wales (2013) 252 CLR 530 at 554 [36]. 22 Knight v Victoria (2017) 261 CLR 306 at 324-325 [32]-[33]. 23 Universal Film Manufacturing Co (Australasia) Ltd v New South Wales (1927) 40 CLR 333 at 350-351. Bell In these circumstances, the prudential considerations reflected in the rule of practice referred to in Lambert do not weigh decisively against entertaining Mrs Clubb's contention that the communication prohibition impermissibly burdens the implied freedom. It is expedient in the interests of justice to proceed to determine whether Mrs Clubb is entitled to have her conviction set aside on the grounds asserted by her in this Court. A burden on the implied freedom? The first step in applying the McCloy test is to ask whether the communication prohibition burdens the implied freedom. To answer that question, it is necessary to consider the terms, legal operation and practical effect of the statute24. Mrs Clubb argued that the communication prohibition effectively proscribes many communications which can be characterised as "political", including communications about whether governments should encourage or discourage abortions and whether laws should be changed to restrict or facilitate abortions. Mrs Clubb submitted that in its legal operation the prohibition proscribes such communications, and in its practical operation it deters them. The Solicitor-General for Victoria accepted that the prohibition may capture a broad range of communications. Even though it is not expressly targeted at communications concerning governmental and political matters, it may apply to such communications. On that basis, it must be accepted that the prohibition burdens the implied freedom. A consideration of the nature and extent of the burden can best be left until discussion of the third step of the McCloy test25. Legitimate purpose For the purposes of the second step of the McCloy test, a purpose is compatible with the maintenance of the constitutionally prescribed system of 24 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 567; Wotton v Queensland (2012) 246 CLR 1 at 30 [78], 31 [80]; [2012] HCA 2; Unions NSW v New South Wales (2013) 252 CLR 530 at 548-549 [19], 553-554 [35]-[36], 572 [112], 578 [135], 586 [166]; Brown v Tasmania (2017) 261 CLR 328 at 353 [61], 25 Unions NSW v New South Wales (2013) 252 CLR 530 at 555 [40]; Brown v Tasmania (2017) 261 CLR 328 at 360 [90], 398-399 [237]. Bell representative and responsible government, and therefore legitimate, if it does not impede the functioning of that system26. As will be seen, Mrs Clubb argued that the true purpose of the the suppression of public expression of communication prohibition anti-abortion sentiment, and that this is not a legitimate purpose. An important theme of her argument in this regard was that the connection between the prohibition and its purpose as propounded by the Solicitor-General for Victoria is so tenuous or remote that this "true purpose" can be discerned notwithstanding the terms of the Public Health Act. To this end, Mrs Clubb deployed arguments that were intended to demonstrate the absence of a rational connection between the prohibition and the purpose put forward by the Solicitor-General. These arguments were also directed to negativing the suitability of the prohibition for the purposes of the third step of the McCloy test. For the sake of convenience, some of these arguments will be addressed under this heading, with others being considered under the heading of "Suitability" in the discussion of the third step of the McCloy test. The Solicitor-General for Victoria submitted that the activities of protesters had previously created an environment of "conflict, fear and intimidation" outside abortion clinics, and that these activities were harmful to both patients and staff in a number of ways. It was said to be the concern about the effect of these activities on women accessing abortion services, and on clinic staff, and not the suppression of anti-abortion views, that led to the enactment of the Safe Access Zones Act. In particular, it was said that existing laws did not adequately protect women and staff against the effects of these activities. In this regard, s 185A of the Public Health Act expressly declares the purpose of Pt 9A to be the protection of the safety and wellbeing of, and the preservation of the privacy and dignity of, persons accessing lawful medical services, as well as staff and others accessing the premises in the course of their duties, within the area of a safe access zone. In the Second Reading Speech for the Bill for the Safe Access Zones Act, the Minister explained why this protective purpose was focused within the area of the safe access zones27: 26 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 561-562, 567; McCloy v New South Wales (2015) 257 CLR 178 at 203 [31]. 27 Victoria, Legislative Assembly, Parliamentary Debates (Hansard), 22 October Bell "It is unreasonable for anti-abortion groups to target women at the very time and place when they are seeking to access a health service, or to target health service staff. The impact of such actions on these women must be understood within the context of their personal circumstances. Many are already feeling distressed, anxious and fearful about an unplanned pregnancy, or a procedure that they are about to undergo. To be confronted by anti-abortion groups at this time is likely to exacerbate these feelings. It is intimidating and demeaning for women to have to run the gauntlet of anti-abortion groups outside health services." An additional aspect of the purpose of the challenged legislation relates to the preservation and protection of the privacy and dignity of women accessing abortion services. Privacy and dignity are closely linked; they are of special significance in this case. That significance will be discussed at greater length later in these reasons, but at this point it is desirable to note the protection of dignity as an aspect of the purpose of the communication prohibition. Aharon Barak, a former President of the Supreme Court of Israel, writing extra-judicially, said28: "Most central of all human rights is the right to dignity. It is the source from which all other human rights are derived. Dignity unites the other human rights into a whole." Generally speaking, to force upon another person a political message is inconsistent with the human dignity of that person. As Barak said29, "[h]uman dignity regards a human being as an end, not as a means to achieve the ends of others". Within the present constitutional context, the protection of the dignity of the people of the Commonwealth, whose political sovereignty is the basis of the implied freedom30, is a purpose readily seen to be compatible with the maintenance of the constitutionally prescribed system of representative and 28 The Judge in a Democracy (2006) at 85 (footnotes omitted), cited in Monis v The Queen (2013) 249 CLR 92 at 182-183 [247]; [2013] HCA 4. 29 The Judge in a Democracy (2006) at 86, cited in Monis v The Queen (2013) 249 CLR 92 at 182-183 [247]. 30 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 560; Unions NSW v New South Wales (2013) 252 CLR 530 at 548 [17]; McCloy v New South Wales (2015) 257 CLR 178 at 206 [42], 257 [215]-[216], 280 [303], 283-284 Bell responsible government. Thus, when in Lange31 the Court declared that "each member of the Australian community has an interest in disseminating and receiving information, opinions and arguments concerning government and political matters that affect the people of Australia", there was no suggestion that any member of the Australian community may be obliged to receive such information, opinions and arguments. Mrs Clubb submitted that the communication prohibition does not serve a legitimate purpose compatible with the maintenance of the constitutionally prescribed system of representative and responsible government because the object pursued by the prohibition is offensive to that system in that it burdens the anti-abortion side of the abortion debate more than the pro-choice side. Mrs Clubb also argued that to prohibit communications on the ground that they are apt to cause discomfort is not compatible with the constitutional system. In this regard, it was said that political speech is inherently apt to cause discomfort, and causing discomfort may be necessary to the efficacy of political speech. These submissions should not be accepted, for the reasons which follow. In dealing with Mrs Clubb's submissions, some reference to the nature of the burden on the implied freedom is necessary because it bears on the second step of the McCloy test. In Coleman v Power32, McHugh J, for example, said: "Ordinarily ... serious interference with, political communication would itself point to the inconsistency of the objective of the law with the system of representative government." Discriminatory? It is an important part of Mrs Clubb's argument that the communication prohibition discriminates against her side of the debate about abortion. A law that burdens one side of a political debate, and thereby necessarily prefers the other, tends to distort the flow of political communication. Contrary to Mrs Clubb's contention that the communication prohibition is aimed at, and biased against, the anti-abortion viewpoint, the prohibition is not directed exclusively at anti-abortion communication. In truth, the prohibition is viewpoint neutral. That is so as a matter of the ordinary meaning of the text of para (b) of the definition of "prohibited behaviour" in s 185B(1), which is concerned with communicating "in relation to abortions" rather than "against 31 (1997) 189 CLR 520 at 571. 32 (2004) 220 CLR 1 at 52 [98]; [2004] HCA 39. Bell abortions". The ordinary meaning of the text is confirmed by s 185B(2); that provision would be unnecessary if only anti-abortion communications were caught by the definition. It is also confirmed by the consideration that a person seeking access to premises where abortions are provided is likely to be caused distress or anxiety by attempts by pro-choice activists to co-opt her as part of their message as well as by the reproach of anti-abortionists. It may well be that the prohibition is likely to be breached in practice more frequently by those espousing an anti-abortion message than by those of a contrary view, but it is simply not the case that the prohibition targets only one side of the controversy. The mischief at which the prohibition is directed, namely interference by activists with those seeking access to premises where abortions are provided to obtain, or to assist in providing, abortions, may arise no less from the activities of those espousing a pro-abortion message as from those espousing an anti-abortion message. The privacy and the dignity of the persons intended to be protected by the prohibition may be adversely affected by either kind of communication. And, in the nature of things, pro-abortion activities outside a clinic where abortions are provided are apt to attract countermeasures by anti-abortion activists. Discomfort or hurt feelings Mrs Clubb argued that if the objects of the communication prohibition are truly those set out in s 185A, then s 185D lacks a rational connection to those objects because it applies to conduct apt to cause no more than "discomfort" or "hurt feelings". This argument ignores the plain words of the statutory text. The conduct in question must be "reasonably likely to cause distress or anxiety", not mere discomfort or hurt feelings. The connection required by the prohibition between the communication and the potential to cause distress or anxiety to another person is not illusory. In the context of para (b) of the definition of "prohibited behaviour", the word "likely" bears its ordinary meaning, namely, "to convey the notion of a substantial – a 'real and not remote' – chance regardless of whether it is less or more than 50 per cent"33. The tendentious suggestion that the communication prohibition might be engaged by conduct apt to cause no more than "discomfort" or "hurt feelings" calls to mind suggestions to the effect that political speech cannot be truly free if it can be silenced for no reason other than to spare the feelings of those spoken 33 Boughey v The Queen (1986) 161 CLR 10 at 21; [1986] HCA 29. Bell about. Suggestions to that effect may have some attraction in the context of public conflict between commercial or industrial rivals or in the context of a political debate between participants who choose to enter public controversy. But they have no attraction in a context in which persons attending to a private health issue, while in a vulnerable state by reason of that issue, are subjected to behaviour apt to cause them to eschew the medical advice and assistance that they would otherwise be disposed to seek and obtain. One may conclude that the second step of the McCloy test is satisfied. The purposes of the communication prohibition do not impede the functioning of the constitutionally prescribed system of representative and responsible government. To the extent that the purposes include protection against attempts to prevent the exercise of healthcare choices available under laws made by the Parliament, those purposes are readily seen to be compatible with the functioning of the system of representative and responsible government. Further, a law that prevents interference with the privacy and dignity of members of the people of the Commonwealth through co-optation as part of a political message is consistent with the political sovereignty of the people of the Commonwealth and the implied freedom which supports it34. Advancing the legitimate purpose: is proportionality testing necessary? The Solicitor-General for Victoria submitted that it is not necessary in this case to undertake all of the proportionality testing involved in the third step of the McCloy test. That was said to be because any burden on the implied freedom is minimal and the burden is imposed to further a compelling legislative purpose. It was said that all that is required in the present case is that the means adopted by the law are rationally related to the pursuit of that compelling purpose. It was said that there is ample evidence of a rational connection between the legislative purpose and the communication prohibition. The Solicitor-General submitted that the public interest in protecting those accessing abortion clinics from harm is so compelling that any restriction on the implied freedom is more than balanced by the benefits sought to be achieved. In addition, she argued that the communication prohibition is no broader than is necessary to achieve its object, because it is not possible to eliminate the prohibition, or reduce its scope, while still retaining its effectiveness. These submissions by the Solicitor-General should not be accepted. 34 cf McCloy v New South Wales (2015) 257 CLR 178 at 206-207 [42]-[45], 220-221 Bell It may be accepted that when the burden on the implied freedom is very slight it becomes difficult to say, consistently with the limitations on judicial power, that alternative measures are available that would be less burdensome while at the same time equally efficacious. However, McCloy requires that any effective burden on the freedom must be justified35. It could hardly be said that a measure which is more restrictive of the freedom than is necessary can rationally justify the burden36. Further, that a burden upon the implied freedom is of small magnitude and for a compelling legitimate purpose does not dispense with the need to determine whether the impugned law is reasonably appropriate and adapted to the achievement of its purpose37. At this point in the application of the McCloy test, the focus has shifted to the relationship between the purpose and the extent to which the implied freedom is burdened. The issue for the courts is not to determine the correct balance of the law; that is a matter for the legislature. The question is whether the law can be seen to be irrational in its lack of balance in the pursuit of its object. While it may be accepted that the court will reach that conclusion only where the disproportion is such as to manifest irrationality, it is desirable, in the interests of transparency, that the court face up to, and explicitly deal with, this question. The ultimate question to which the enquiry is directed is whether the burden effected by the law is, as stated in Lange38, "undue". In the plurality judgment in McCloy39, it was said: "The inquiry must be whether the burden is undue, not only by reference to the extent of the effect on the freedom, but also having regard to the public importance of the purpose sought to be achieved. This is the balance which necessarily, and logically, inheres in the Lange test." 35 McCloy v New South Wales (2015) 257 CLR 178 at 201 [24]. See also Brown v Tasmania (2017) 261 CLR 328 at 369 [127]. 36 Brown v Tasmania (2017) 261 CLR 328 at 370 [130]. 37 McCloy v New South Wales (2015) 257 CLR 178 at 213 [68]; Brown v Tasmania (2017) 261 CLR 328 at 369 [127]. 38 (1997) 189 CLR 520 at 569, 575. See also McCloy v New South Wales (2015) 257 CLR 178 at 214-215 [71]. 39 (2015) 257 CLR 178 at 218 [86]. Bell In this context, to speak of an impermissible burden on the implied freedom is to speak of a burden that is undue in the sense that it is disproportionate to the law's effect in achieving its legitimate purpose40. So in Brown41, the impugned law was held invalid by Kiefel CJ, Bell and Keane JJ because of the "overreach of means over ends". In that case, the impugned law, in its operation and effect, burdened the implied freedom in a way that exceeded the rational pursuit of the legitimate purpose of protecting businesses from disruption by protesters. the law strikes some The question whether a law is "adequate in its balance" is not concerned with whether ideal balance between competing considerations. It is no part of the judicial function to determine "where, in effect, the balance should lie"42. Rather, the question is whether the law imposes a burden on the implied freedom which is "manifestly excessive by comparison to the demands of legitimate purpose"43. Proportionality testing is an assessment of the rationality of the challenged law as a response to a perceived mischief that must also respect the implied freedom. A law which allows a person to be shot and killed in order to prevent damage to property can be seen to have a connection to the purpose of preventing damage to property. It may also be accepted that other means of preventing damage to property would not be as effective. Nevertheless, the law is not a rational response to the mischief at which it is directed because it is manifestly disproportionate in its effect on the peace, order and welfare of the community. In the same way, it is only if the public interest in the benefit sought to be achieved by the legislation is manifestly outweighed by an adverse effect on the implied freedom that the law will be invalid. 40 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 569, 575. See also McCloy v New South Wales (2015) 257 CLR 178 at 214-215 [71]. 41 (2017) 261 CLR 328 at 365 [109]. 42 Brown v Tasmania (2017) 261 CLR 328 at 422-423 [290]. 43 Brown v Tasmania (2017) 261 CLR 328 at 422-423 [290]. See also McCloy v New South Wales (2015) 257 CLR 178 at 219-220 [89]-[92]. Bell In McCloy44, the plurality said: "To say that the courts are able to discern public benefits in legislation which has been passed is not to intrude upon the legislative function. The courts acknowledge and respect that it is the role of the legislature to determine which policies and social benefits ought to be pursued. This is not a matter of deference. It is a matter of the boundaries between the legislative and judicial functions." It is important to be clear that what is involved is not a comparison of the general social importance of the purpose of the impugned law and the general social importance of keeping the implied freedom unburdened. Rather, what is to be balanced are the effects of the law – in terms of the benefits it seeks to achieve in the public interest and the extent of the burden on the implied freedom. Such an exercise is familiar as an exercise of judicial power from cases including Sankey v Whitlam45, Hinch v Attorney-General (Vict)46 and Hogan v Hinch47. And as the plurality noted in McCloy48, "notions of balancing may be seen in Castlemaine Tooheys Ltd v South Australia49, in the context of the s 92 freedom". The proportionality analysis applied in McCloy and Brown accords with the foundational authority of the decision in Lange, where the Court said50: "Different formulae have been used by members of this Court in other cases to express the test whether the freedom provided by the Constitution has been infringed. Some judges have expressed the test as whether the law is reasonably appropriate and adapted to the fulfilment of a legitimate including Others have favoured different expressions, purpose. 44 (2015) 257 CLR 178 at 220 [90]. 45 (1978) 142 CLR 1 at 39, 43; [1978] HCA 43. See also at 63-64, 98-99. 46 (1987) 164 CLR 15 at 85-87; [1987] HCA 56. See also at 26-27, 41-43, 50, 75. 47 (2011) 243 CLR 506 at 536-537 [32]; [2011] HCA 4. 48 (2015) 257 CLR 178 at 219 [87]. 49 (1990) 169 CLR 436; [1990] HCA 1. 50 (1997) 189 CLR 520 at 562. Bell proportionality. In the context of the questions raised by the case stated, there is no need to distinguish these concepts." Furthermore, the abstract and indeterminate language of the second limb in Lange51 (which was stated as the third step of the McCloy test) can be a source of difficulty in its application. The proportionality analysis referred to in McCloy and Brown addresses this and explains how the conclusion required by Lange – whether the burden is "undue" – is to be reached. In addition, a structured proportionality analysis provides the means by which rational justification for the legislative burden on the implied freedom may be analysed, and it serves to encourage transparency in reasoning to an answer52. It recognises that to an extent a value judgment is required but serves to reduce the extent of it. It does not attempt to conceal what would otherwise be an impressionistic or intuitive judgment of what is "reasonably appropriate and adapted"53. Suitability Whether a law that burdens the implied freedom is justified in accordance with the third step of the McCloy test requires a consideration of the nature and extent of the burden. In this regard, the Solicitor-General for Victoria submitted that any burden on the implied freedom is incidental: not all communication about abortions is political, and the communication prohibition is not directed to political communication. Only communications about abortions are targeted. Further, any effect on political communication is insubstantial because, outside a safe access zone, people may protest and express their views about abortions however they choose. It was said that all that is involved in s 185D is a "time, manner and place" restriction54 that is tailored to meet a legitimate purpose and to leave political communication otherwise untrammelled. Mrs Clubb argued that the prohibition applies exclusively to the anti-abortion side of the debate. This argument has already been considered and rejected. 51 cf Unions NSW v New South Wales (2013) 252 CLR 530 at 576 [129]. 52 McCloy v New South Wales (2015) 257 CLR 178 at 216 [75]; Brown v Tasmania (2017) 261 CLR 328 at 369 [125]. 53 McCloy v New South Wales (2015) 257 CLR 178 at 216 [75]; Brown v Tasmania (2017) 261 CLR 328 at 369 [125]. 54 Citing Brown v Tasmania (2017) 261 CLR 328 at 462 [420]. Bell Mrs Clubb's other arguments under this heading will now be examined. That examination reveals that these arguments seriously exaggerate the effect of the prohibition on the implied freedom. The protection of people in safe access zones Mrs Clubb argued that the circumstance that the prohibition is directed to communications in relation to abortions, whether or not the communication is in fact seen or heard, is an impermissible burden on the freedom. Further, it was said that because there need not be an actual person accessing or leaving the premises for the purposes of an abortion, the prohibition applies whether or not distress or anxiety is in fact caused to any person and irrespective of whether there is in fact harm to safety, wellbeing, privacy or dignity. Mrs Clubb's argument that the prohibition is excessive in its effect because it does not require proof of actual harm to any person fails to appreciate the protective purpose of the legislation. The prohibition on communicating about abortions in a safe access zone is intended to protect and preserve a corridor of ready access to reproductive healthcare facilities rather than merely to punish an actual interference with a person seeking such access. It is the creation of safe access zones that prevents a situation in which an unwilling listener or viewer cannot avoid exposure to communication about abortions outside the clinic because they are obliged to enter the clinic from the area in which activists are present. That the prohibition may be breached without a person actually hearing or seeing a communication about abortions, or actually being caused distress or anxiety, is an aspect of the prophylactic approach of creating safe access zones. On-site protests Mrs Clubb argued that abortion has been a topic of political debate in Australia for many years. It was said that it is, and has been, a characteristic feature of that debate that many of those who have views on the issue choose to express those views outside or near premises at which abortions can be obtained. As a result, political communications about abortions are often most effective when they are engaged in at a place where abortions are provided. Further, it was said that persons entering or leaving premises at which abortions are provided are especially vulnerable to distress or anxiety, and, as a result, the prohibition is likely to proscribe or deter all or almost all communications in relation to that topic, and so to proscribe political communications in relation to abortion near abortion facilities is to proscribe those communications in the very location that they are typically most effective. Bell immediately It may be noted that Mrs Clubb's submission that anti-abortion communication is most effective when it occurs near an abortion clinic is not supported by any finding of fact or evidence. In this regard, the present case may be contrasted with Brown55, where it was established as a matter of fact that "on-site protests against forest operations and the broadcasting of images of parts of the forest environment at risk of destruction are the primary means of bringing such the public and parliamentarians". There was thus no evidence in the present case upon which an argument for the special efficacy of on-site protests as a form of political communication about the issue of abortion could be based. the attention of issues In any event, there is a more important point of distinction between this case and Brown. The on-site protests against forest operations discussed in Brown did not involve an attack upon the privacy and dignity of other people as part of the sending of the activists' message. Even if the argument for Mrs Clubb as to the special potency of on-site protests as a mode of political communication were to be accepted, her argument would still fail because the implied freedom is burdened only within the safe access zones. It is within those zones that intrusion upon the privacy, dignity and equanimity of persons already in a fraught emotional situation is apt to be most effective to deter those persons from making use of the facilities available within the safe access zones. This, after all, is the very reason for Mrs Clubb's activities. Mrs Clubb's own argument demonstrates that the legitimate purpose which justifies the burden is at its strongest within the perimeter of the safe access zones. Within those zones, the burden on the implied freedom is justified by the very considerations of the dignity of the citizen as a member of the sovereign people that necessitate recognition of the implied freedom. Those wishing to say what they want about abortions have an unimpeded ability to do so outside the radius of the safe access zones. The 150 m radius of the safe access zones serves merely to restrict their ability to do so in the presence of a captive audience of pregnant women seeking terminations and those involved in advising and assisting them. In relation to the radius of the safe access zones, the Minister explained in her Second Reading Speech56: "A zone of 150 metres was chosen after consultation with a wide range of stakeholders. Hospitals and clinics provided examples of the activities of 55 (2017) 261 CLR 328 at 400 [240]. 56 Victoria, Legislative Assembly, Parliamentary Debates (Hansard), 22 October Bell anti-abortion groups and the places where they confronted patients and staff. This included waiting at places where patients parked their cars and at public transport stops. Some health services asked for a much larger zone, but after careful consideration it was determined that a zone of 150 metres would be sufficient to protect people accessing premises." The impugned law is suitable, in that it has a rational connection to its purpose. The communication prohibition has a rational connection to the statutory purpose57 of promoting public health. Unimpeded access to clinics by those seeking to use their services and those engaged in the business of providing those services is apt to promote public health. A measure that seeks to ensure that women seeking a safe termination are not driven to less safe procedures by being subjected to shaming behaviour or by the fear of the loss of privacy is a rational response to a serious public health issue. The issue has particular significance in the case of those who, by reason of the condition that gives rise to their need for healthcare, are vulnerable to attempts to hinder their free exercise of choice in that respect58. In addition, the communication prohibition has a rational connection to the statutory purpose of protecting the privacy and dignity of women accessing abortion services. As noted above, that connection accords with the constitutional values that underpin the implied freedom. Necessity The unchallenged evidence in this case is that, in contrast to the pre-existing law, the effect of the communication prohibition has been to reduce the deterrent effect of anti-abortion activities near premises where abortions are provided. There was evidence before the Magistrate from Dr Allanson of her observations that until the commencement of Pt 9A of the Public Health Act in 2015, attempts by the Clinic to engage the assistance of the police and the Melbourne City Council to help stop harassment of the Clinic's patients by anti-abortion groups were ineffective. Mrs Clubb submitted that the communication prohibition is not necessary to achieve the objects referred to in s 185A because there are less burdensome 57 Unions NSW v New South Wales (2013) 252 CLR 530 at 557-558 [50]-[55], 561 [64], 579 [140]-[141]; McCloy v New South Wales (2015) 257 CLR 178 at 217 58 Hill v Colorado (2000) 530 US 703 at 728-729. Bell alternatives. Mrs Clubb sought to develop this argument in a number of ways, each of which may be dealt with briefly. First, she drew attention, as an example, to para (a) of the definition of "prohibited behaviour". This argument cannot be accepted. The communication prohibition is necessary because non-violent protest that would not fall within para (a) of the definition of "prohibited behaviour" may well be apt to shame or frighten a pregnant woman into eschewing the services of a clinic. As was said by Saunders J in R v Lewis59: "Although much of the protest activity has been described as peaceful, in my view that is a mischaracterization. Peace connotes harmony. There is, on the evidence tendered at trial, no harmony here between protesters and those entering the clinic. At its most benign the protest activity could be described as non-violent." Silent but reproachful observance of persons accessing a clinic for the purpose of terminating a pregnancy may be as effective, as a means of deterring them from doing so, as more boisterous demonstrations. Further, there is the pragmatic consideration that "the line between peaceful protest and virulent or even violent expression against abortion is easily and quickly crossed"60. The communication prohibition gives effect to a legislative judgment that the laws in Victoria prior to the enactment of the Safe Access Zones Act did not adequately protect women seeking to access reproductive health clinics from activities which, though non-violent, had the potential to deter them from availing themselves of those facilities. The legislative judgment that activities falling short of intentional intimidation, harassment, threatening behaviour or physical interference in terms of personal violence were also capable of deterring unimpeded access to clinics cannot be said to impose an unnecessary burden upon the implied freedom. The statement of compatibility in relation to the Bill for the Safe Access Zones Act tabled by the Minister for Health in accordance with the Charter of Human Rights and Responsibilities Act 2006 (Vic) explained61: 59 (1996) 139 DLR (4th) 480 at 493 [32]. See also R v Spratt (2008) 298 DLR (4th) 60 R v Spratt (2008) 298 DLR (4th) 317 at 338 [80]. 61 Victoria, Legislative Assembly, Parliamentary Debates (Hansard), 22 October Bell "Provisions that only prohibit intimidating, harassing or threatening conduct, or conduct which impedes access to premises are inadequate for a number of reasons, including: They can only be enforced after the harmful conduct has occurred and there are significant difficulties in enforcing such laws. This is particularly the case in relation to conduct directed toward women accessing legal abortion services. Although such conduct has often extended to criminal conduct, women and their support persons are generally unwilling to report the conduct to police or assist in a prosecution which would expose them to the stress and possible publicity of a criminal proceeding. The intensely private nature of the decision that the protesters seek to denounce, effectively operates to protect the protesters from prosecution for criminal conduct. It will not fully protect staff members and others from the harmful effect of the otherwise peaceful protests given their sustained nature and the background of extreme conduct against which they occur. Staff and members of the public are entitled to be safe and to feel safe in undertaking their lawful work activities and accessing lawful health services. I consider that it is necessary to create a safe access zone around premises at which abortions are provided, and prohibit certain communications in relation to abortions within that zone, in order to prevent the harm and not just to respond to inappropriate conduct when it occurs." Mrs Clubb also argued that a less burdensome law could have excluded conduct apt to cause no more than discomfort. That argument has already been considered and rejected. Mrs Clubb argued that the communication prohibition is unnecessarily burdensome because of the absence of a requirement that an offending communication actually be heard or seen by any person. Such a requirement would lessen the effectiveness of the prohibition. A contravention of the communication prohibition can be proved without the need to call a person protected by the legislation to give evidence. That can readily be understood as an aspect of the protection of the privacy of women seeking access to abortion services. Mrs Clubb also argued that the burden on the implied freedom is unduly heavy because of the absence of a requirement that the communication occur without the consent of the recipient. That argument should be rejected. Such a Bell requirement would mean that in many, practically speaking all, cases the harm to which the prohibition is directed would be done before consent is sought. In addition, such a requirement would facilitate avoidance of the prohibition by the simple expedient of having someone within the safe access zone consent to receiving an otherwise prohibited communication. Next, Mrs Clubb argued that the extent of the burden might have been reduced by providing for an exception to the prohibition during election campaigns. That argument too should be rejected. In the nature of things the need for abortion services and the anxiety and distress associated with accessing those services is not lessened during election campaigns. If anything, the contrary is likely to be the case. Mrs Clubb also argued that the communication prohibition is excessive in its effect because it is a strict liability offence not confined by a mens rea requirement. Once again that is not so. The prohibition is not engaged unless there is an intentional act of communication of matter relating to abortions, and that act must be performed in a manner that is capable of being heard by a person who may be accessing or attempting to access the relevant premises. Further, the communication must occur, and be intended to occur, within 150 m of premises at which abortions are provided62. Whether the matter communicated is reasonably likely to cause distress or anxiety is a matter of fact to be determined objectively. Adequacy of balance If an impugned law's purpose is compatible with the constitutionally prescribed system of representative and responsible government, the law will nevertheless be invalid if it pursues that purpose by means that have the effect of impermissibly burdening the implied freedom63. As noted above, it is no part of the implied freedom to guarantee a speaker an audience, much less a captive audience. As Nettle J observed in Brown64: "The implied freedom of political communication is a freedom to communicate ideas to those who are willing to listen, not a right to force 62 He Kaw Teh v The Queen (1985) 157 CLR 523 at 528-529, 546, 549-550, 574, 591-592; [1985] HCA 43. 63 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 567-568. 64 (2017) 261 CLR 328 at 415 [275]. Bell an unwanted message on those who do not wish to hear it65, and still less to do so by preventing, disrupting or obstructing a listener's lawful business activities. Persons lawfully carrying on their businesses are entitled to be left alone to get on with their businesses and a legislative purpose of securing them that entitlement is, for that reason, a legitimate governmental purpose." The implied freedom is not a guarantee of an audience; a fortiori, it is not an entitlement to force a message on an audience held captive to that message66. As has been noted, it is inconsistent with the dignity of members of the sovereign people to seek to hold them captive in that way. A law calculated to maintain the dignity of members of the sovereign people by ensuring that they are not held captive by an uninvited political message accords with the political sovereignty which underpins the implied freedom67. A law that has that effect is more readily justified in terms of the third step of the McCloy test than might otherwise be the case. The burden on the implied freedom is slight in respect of both its subject matter and its geographical extent. Within the safe access zones, the only burden on the implied freedom is upon communications about abortions, and that burden is limited to preventing the capture of an audience. In these circumstances, one cannot say that a smaller safe access zone would be as effective in restricting the ability of those who wish to have their say about abortions in the presence of a captive audience of pregnant women and those involved in advising and assisting them, while at the same time imposing a lesser practical burden on the implied freedom. 65 McClure v Australian Electoral Commission (1999) 73 ALJR 1086 at 1090 [28]; 163 ALR 734 at 740-741; [1999] HCA 31; Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 245-246 [182]; Attorney-General (SA) v Adelaide City Corporation (2013) 249 CLR 1 at 37 [54]; [2013] HCA 3; Monis v The Queen (2013) 249 CLR 92 at 206-207 [324]. See and compare Cox v Louisiana (1965) 379 US 536 at 553-556; Frisby v Schultz (1988) 487 US 474 at 484-488; Hill v Colorado (2000) 530 US 703 at 715-718; McCullen v Coakley (2014) 134 S Ct 2518 at 2545-2546. 66 Hill v Colorado (2000) 530 US 703 at 729; Ontario (Attorney-General) v Dieleman (1994) 117 DLR (4th) 449 at 723-724; R v Spratt (2008) 298 DLR (4th) 317 at 67 McCloy v New South Wales (2015) 257 CLR 178 at 206-207 [42]-[45], 220-221 Bell In addition, in McCloy the public interest served by the impugned legislation was held to be the minimisation of the risk of the corruption of the electoral process. There the impugned legislation was seen to pursue objectives that "support and enhance equality of access to government, and the system of representative government which the freedom protects"68. For similar reasons in the present case, difficulties in the balancing exercise do not loom as large as they sometimes may. The balance of the challenged law can, in significant part, be assessed in terms of the same values as those that underpin the implied freedom itself in relation to the protection of the dignity of the people of the Commonwealth. In summary in relation to the third step of the McCloy test, the limited interference with the implied freedom is not manifestly disproportionate to the objectives of the communication prohibition. The burden on the implied freedom is limited spatially, and is confined to communications about abortions. There is no restriction at all on political communications outside of safe access zones. There is no discrimination between pro-abortion and anti-abortion communications. The purpose of the prohibition justifies a limitation on the exercise of free expression within that limited area. And the justification of the prohibition draws support from the very constitutional values that underpin the implied freedom. Accordingly, the communication prohibition satisfies the third step of the McCloy test. Conclusion and orders So much of the appellant's appeal from the judgment of Magistrate Bazzani made on 11 October 2017 as has been removed into this Court should be dismissed. The appellant must pay the respondents' costs. The Preston appeal The charge Mr Preston was charged in the Magistrates Court of Tasmania with breaching s 9(2) of the Reproductive Health Act on two occasions in September 2014 and on one occasion in April 2015. The events which give rise to the charges occurred within 150 m of the Specialist Gynaecology Centre situated at 1A Victoria Street, Hobart. On each 68 McCloy v New South Wales (2015) 257 CLR 178 at 221 [93]. Bell occasion, Mr Preston was on the footpath of Macquarie Street near its corner with Victoria Street and was able to be seen with placards which included statements such as "EVERY ONE HAS THE RIGHT TO LIFE, Article 3, Universal Declaration of Human Rights" and "EVERY CHILD HAS THE RIGHT TO LIFE, Article 6, UN Convention on the Rights of the Child" and depicting, among other things, a representation of a foetus at eight weeks. Mr Preston also had leaflets in his hand and was carrying a media release. The proceedings The Magistrate found that the offences charged were proved beyond a reasonable doubt. Her Honour then proceeded to determine the argument raised by the defence that s 9(2) of the Reproductive Health Act, read with para (b) of the definition of "prohibited behaviour" in s 9(1), impermissibly burdened the implied freedom. Her Honour rejected that defence, concluding that the legislation is valid. Mr Preston sought review of the decision of the Magistrates Court in the Supreme Court of Tasmania. In that Court, he advanced eight grounds of review. On 23 March 2018, Gordon J, pursuant to s 40 of the Judiciary Act, ordered the removal of that part of the appeal concerned with six of those grounds into this Court. Mr Preston subsequently filed an amended notice of appeal in this Court, which advanced six grounds of review, contending in substance that the Magistrate should have found that s 9(2) of the Reproductive Health Act, read with para (b) of the definition of "prohibited behaviour" in s 9(1), impermissibly burdens the implied freedom. Legislation Section 9 of the Reproductive Health Act relevantly provides: In this section – access zone means an area within a radius of 150 metres from premises at which terminations are provided; prohibited behaviour means – Bell a protest in relation to terminations that is able to be seen or heard by a person accessing, or attempting to access, premises at which terminations are provided; or (2) A person must not engage in prohibited behaviour within an access zone. Penalty: Fine not exceeding 75 penalty units or imprisonment for a term not exceeding 12 months, or both." "[T]erminate" is defined in s 3(1) of the Act as follows: "terminate means to discontinue a pregnancy so that it does not progress to birth by – using an instrument or a combination of instruments; or using a drug or a combination of drugs; or any other means – but does not include – the supply or procurement of any thing for the purpose of discontinuing a pregnancy; or the administration of a drug or a combination of drugs for the purpose of discontinuing a pregnancy by a nurse or midwife acting under the direction of a medical practitioner". Section 9(2), read with para (b) of the definition of "prohibited behaviour", will be referred to in these reasons as "the protest prohibition". The expression "prohibited behaviour" is also defined to mean: in relation intimidating, to a person, besetting, harassing, interfering with, threatening, hindering, obstructing or impeding that person; or footpath interference in relation to terminations; or Bell intentionally recording, by any means, a person accessing or attempting to access premises at which terminations are provided without that person's consent". The expression "footpath interference" is not defined in the legislation. It seems that the expression was derived from s 2(1) of the Access to Abortion Services Act 1995 of British Columbia, which prohibits "sidewalk interference". In R v Lewis69, it was said that the expression "sidewalk interference" corresponded with "sidewalk counselling", a form of private health communication. Having regard to s 9(2) of the Reproductive Health Act, the expression "footpath interference" would catch conduct apt to waylay the user of a footpath in an access zone seeking access to a clinic in relation to a termination. Finally, s 9(4) provides: "A person must not publish or distribute a recording of another person accessing or attempting to access premises at which terminations are provided without that other person's consent." The differences between the Tasmanian and Victorian prohibitions It is apparent that the Reproductive Health Act differs from its Victorian counterpart in a number of respects. First, the Reproductive Health Act does not expressly state its objects. Secondly, the impugned prohibition is directed at "a protest" about terminations. Thirdly, the scope of the operation of the prohibition is not limited by a requirement that the protest be reasonably likely to cause distress or anxiety. It might be said that the case to be made for the invalidity of the protest prohibition as an impermissible burden on the implied freedom is stronger than the case to be made against its Victorian counterpart because the prohibition is directed squarely at what is a familiar form of political communication, because the Tasmanian legislation does not articulate the objects that justify its intrusion on the implied freedom, and because the protest prohibition does not require a potential to cause distress or anxiety. It might also be said that the Victorian legislation is an example of an obvious and compelling alternative measure less intrusive upon the implied freedom. In the end, however, these differences do not warrant a different result in the Preston appeal. 69 (1996) 139 DLR (4th) 480 at 512 [108]. Bell A burden on the implied freedom that the phrase "protest terminations", the word "protest" should be understood as referring exclusively to a protest expressing a message that is in opposition to terminations. Mr Preston argued that the protest prohibition is in terms directed to "protest", which is a characteristic mode of political communication. It was said that the prohibition imposes a more direct burden on political communication than the Victorian legislation because its sole focus is "protest". in relation The Solicitor-General for Tasmania accepted that a protest in relation to terminations may in some cases contain political communication. That concession was rightly made. The protest prohibition is a burden on the implied freedom. Given the express inclusion of "footpath interference" in the definition of "prohibited behaviour", it is impossible to understand the word "protest" in the prohibition on protest as referring to anything other than a public demonstration about abortion. In context, the term "protest" is apt to encompass the dissemination of a message "in relation to terminations" that concerns governmental or political matters. Legitimate purpose The Solicitor-General for Tasmania submitted that, notwithstanding the absence of a statement in the Reproductive Health Act of its objects, the protest prohibition can readily be seen to serve the purpose of protecting the safety, wellbeing, privacy and dignity of persons accessing premises where terminations are provided. That submission should be accepted. While the Reproductive Health Act is not as explicit as to its objects as its Victorian counterpart, its purpose is apparent from its terms and subject matter as well as from the Bill for the Reproductive Health Act. The Minister for Health, having stated that "without the provision of a full range of safe, legal and accessible reproductive services, women experience poorer health outcomes"70, went on to identify, as a significant obstacle to women accessing safe termination services, the "stigma" and "shame" associated with having to run the gauntlet of protesters the Second Reading Speech for 70 Tasmania, House of Assembly, Parliamentary Debates (Hansard), 16 April 2013 at Bell in order to gain access to medical clinics providing those services71. She went on to say72: "[S]tanding on the street outside a medical facility with the express purpose of dissuading or delaying a woman from accessing a legitimate reproductive health service is ... quite unacceptable." The object of the prohibition is to protect the safety and wellbeing, physical and emotional, of persons accessing and leaving abortion clinics and to ensure that women may have unimpeded access to, and doctors may provide, terminations. Mr Preston argued that the prohibition does not serve a legitimate purpose because it applies exclusively to anti-abortion protests and could apply to protests against the Reproductive Health Act itself. Contrary to this submission, the prohibition is viewpoint neutral. It would be contravened by a protest in favour of the Reproductive Health Act. One cannot ignore the use of viewpoint neutral language rather than an obvious alternative, such as "protest against abortions", if the legislation was targeted only at anti-abortion protests. Further, protest about terminations is a public demonstration or manifestation of opinion in relation to one or other side of the debate about terminations. Whichever side of the debate is engaged in the public demonstration or manifestation, the emotional temperature within the access zone will be raised, and that, it can readily be accepted, will create a disincentive to a person previously disposed to seek access to medical advice and assistance in relation to a termination. Further, as noted earlier, pro-abortion activities outside a clinic where abortions are provided are likely, in the nature of things, to attract countermeasures by anti-abortion activists. Suitability The protest prohibition has a rational connection to the purpose of facilitating effective access to pregnancy termination services. Where pregnancy termination-related protests can be seen or heard by persons attempting to access premises providing that health service, pregnant women may be deterred from accessing the premises. Conduct avowedly undertaken with a view to persuading another person to desist from a course of conduct is apt to produce that result. 71 Tasmania, House of Assembly, Parliamentary Debates (Hansard), 16 April 2013 at 72 Tasmania, House of Assembly, Parliamentary Debates (Hansard), 16 April 2013 at Bell type of communication caught by is a The termination-related protest that, in practice, a woman attempting to access an abortion facility cannot avoid except by eschewing the medical advice and assistance that she seeks. the protest prohibition Necessity Mr Preston argued that the protest prohibition applies whether or not any harm, anxiety or distress is in fact caused, whether or not any harm, anxiety or distress is likely, reasonably likely or reasonably possible, and whether or not any harm, anxiety or distress is in fact intended. But the absence of a limiting requirement that the protest be likely to cause distress or anxiety is of little moment once it is appreciated that the protest prohibition is concerned, as it plainly is, to prevent demonstrations about terminations in the vicinity of facilities where terminations are provided. A public demonstration or manifestation about abortions in the vicinity of a clinic inevitably constitutes a threat to the equanimity, privacy and dignity of a pregnant woman seeking medical advice and assistance in relation to a termination. And that will be so whether or not such a person is likely to suffer distress or anxiety as a result. A decision to avoid a protest about abortions may reflect a calm and reasonable decision to eschew an unwelcoming environment as well as a stressed and anxious reaction to it. Adequacy of balance The Reproductive Health Act, in targeting a "protest" about abortion, is directed at public demonstration, whatever its viewpoint, which is likely to be confronting to those in need of medical advice and assistance from a clinic. The purposes of the Reproductive Health Act in this respect are the same as those of Pt 9A of the Victorian Act. The cardinal features of both pieces of legislation are that the burden on the implied freedom operates only within safe access zones and is confined to the discussion of abortion. The burden on political communication imposed by the protest prohibition is slight, in that, to the extent that it does affect political communication, it does so only within access zones, and without discriminating between sources of protest. The restriction in the Tasmanian Act on the ability of people to engage in public debate about abortions is adapted to meet the same considerations of the advancement of public health and the protection of the privacy and dignity of citizens as the restriction in the Victorian Act. There is no manifest disproportion between the burden on political communication effected by the protest prohibition and the law's legitimate purpose. Bell Conclusion and orders So much of the appellant's appeal from the judgment of Magistrate Rheinberger made on 27 July 2016 as has been removed into this Court should be dismissed. The appellant must pay the respondents' costs. Mrs Clubb does not assert that she was engaged in any form of political communication when she attempted to hand a pamphlet to a couple outside the East Melbourne Fertility Control Clinic on 4 August 2016. Mrs Clubb accepts that the prohibition against "communicating ... in relation to abortions" in s 185D read with para (b) of the definition of "prohibited behaviour" in s 185B(1) of the Public Health and Wellbeing Act 2008 (Vic) ("the Public Health Act") can and should be read in accordance with s 6(1) of the Interpretation of Legislation Act 1984 (Vic) ("the Interpretation Act") to exclude political communication if the prohibition infringes the implied constitutional freedom in its application to political communication. The combination of those circumstances means that Mrs Clubb's challenge to her conviction in the Magistrates' Court of Victoria of the offence created by s 185D of the Public Health Act, on the ground that the prohibition in that section read with para (b) of the definition of "prohibited behaviour" in s 185B(1) infringes the implied constitutional freedom of political communication, is doomed to fail. Unless set aside on some other ground, Mrs Clubb's conviction will stand irrespective of whether or not she succeeds in establishing that the prohibition infringes the implied constitutional freedom. Because the answer to the question of whether the prohibition in s 185D read with s 185B(1) of the Public Health Act infringes the implied constitutional freedom can make no difference to Mrs Clubb's conviction, so much of Mrs Clubb's appeal to the Supreme Court of Victoria as has been removed into the High Court under s 40 of the Judiciary Act 1903 (Cth) to raise that question should be dismissed without the High Court embarking on the provision of an answer. There is no need to answer the question in order to determine Mrs Clubb's criminal liability. Absent a need to answer the question, the proper course is to decline to do so. The institutional practice and the principle of statutory construction which combine to commend that approach are important enough for me to want to add the following to the analysis of Gordon J in this case, with which I wholly agree. Necessity as a precondition to constitutional adjudication The practice of the High Court has fairly consistently been to decline to answer a constitutional question unless there has been shown to exist a state of facts which has made answering the question necessary in order to determine a right or liability in issue in the matter in which its original or appellate jurisdiction has been invoked73. The practice is closely associated with two principles of judicial restraint which the Supreme Court of the United States has long treated as "safe guides to sound judgment" and which the High Court too can be seen to have observed in practice: "one, never to anticipate a question of constitutional law in advance of the necessity of deciding it; the other never to formulate a rule of constitutional law broader than is required by the precise facts to which it is to be applied"74. The practice is founded on the same basal understanding of the nature of the judicial function as that which has informed the doctrine that the High Court lacks original or appellate jurisdiction to answer any question of law (including but not confined to a question of constitutional law) if that question is divorced from the administration of the law75. The basal understanding is that the primary function served by the conferral of original or appellate jurisdiction on the Court, no differently from the primary function served by the conferral of federal jurisdiction on any other court, is not the declaration of legal principle but the resolution of a controversy about a legal right or legal liability76. The practice stems from recognition of the institutional discipline which concentration on that primary function imposes on the judicial process, no less than on disputant parties77. The institutional discipline is such that curial exposition of legal principle proceeds best when it proceeds if, and no further than is, warranted to determine a legal right or legal liability in controversy. Legal analysis is then directed only to issues that are real and not imagined. Legal principle is then honed through practical application. Academic abstraction is then curbed by the parameters of a concrete dispute. The overarching importance of constitutional principle makes maintenance of that institutional discipline imperative in constitutional cases. 73 Knight v Victoria (2017) 261 CLR 306 at 324 [32]; [2017] HCA 29, quoting Lambert v Weichelt (1954) 28 ALJ 282 at 283. 74 Liverpool, New York & Philadelphia Steamship Co v Commissioners of Emigration (1885) 113 US 33 at 39, quoted in United States v Raines (1960) 362 US 17 at 21 and Washington State Grange v Washington State Republican Party (2008) 552 US 75 Mellifont v Attorney-General (Q) (1991) 173 CLR 289 at 303-305; [1991] HCA 53, explaining In re Judiciary and Navigation Acts (1921) 29 CLR 257 at 266-267; [1921] HCA 20. 76 Fencott v Muller (1983) 152 CLR 570 at 608-609; [1983] HCA 12. 77 cf Kuczborski v Queensland (2014) 254 CLR 51 at 109 [184]; [2014] HCA 46. The practice, in my view, ought not to be departed from on the basis of mere convenience. Especially, the practice ought not to be departed from on the basis that the executive government of a polity whose newly minted legislation is sought to be challenged is content to view an inadequately constructed but earnestly pursued challenge as a vehicle for mounting a spirited defence of the constitutional validity of that legislation. If a case is to be brought to the High Court as a test case, it is not asking too much to expect that the case will be properly constituted lest the judgment that is sought from the Court be traduced to the status of an advisory opinion. Severance explained and distinguished from reading down The High Court has long recognised as a primary principle or "fundamental rule" of statutory construction that "the legislatures of the federation intend to enact legislation that is valid and not legislation that is invalid", from which it follows that "[i]f the choice is between reading a statutory provision in a way that will invalidate it and reading it in a way that will not, a court must always choose the latter course when it is reasonably open"78. That, however, is not the principle of statutory construction now relevant. The relevant principle of statutory construction is a secondary or subsidiary principle, application of which is required by the operation of a severance clause (sometimes referred to as a "severability" or "separability" clause) of the kind introduced in relation to Commonwealth legislation in 1930 with the insertion of s 15A into the Acts Interpretation Act 1901 (Cth)79 and since replicated in s 6(1) of the Interpretation Act and equivalent provisions in interpretation legislation in each other State, the Australian Capital Territory and the Northern Territory80. Subject always to a legislature manifesting a contrary 78 Residual Assco Group Ltd v Spalvins (2000) 202 CLR 629 at 644 [28]; [2000] HCA 33, referring to Davies and Jones v Western Australia (1904) 2 CLR 29 at 43; [1904] HCA 46, Federal Commissioner of Taxation v Munro (1926) 38 CLR 153 at 180; [1926] HCA 58, Attorney-General (Vict) v The Commonwealth (1945) 71 CLR 237 at 267; [1945] HCA 30 and Chu Kheng Lim v Minister for Immigration, Local Government and Ethnic Affairs (1992) 176 CLR 1 at 14; [1992] HCA 64. 79 Acts Interpretation Act 1930 (Cth). See earlier s 2(2) of the Navigation Act 1912 (Cth), considered in Newcastle and Hunter River Steamship Co Ltd v Attorney- General for the Commonwealth (1921) 29 CLR 357 at 369-370; [1921] HCA 31. See also Harrington v Lowe (1996) 190 CLR 311 at 326-327; [1996] HCA 8. 80 Acts Interpretation Act 1915 (SA), s 22A; Acts Interpretation Act 1931 (Tas), s 3; Acts Interpretation Act 1954 (Qld), s 9(2); Interpretation Act (NT), s 59; Interpretation Act 1984 (WA), s 7; Interpretation Act 1987 (NSW), s 31(2); Legislation Act 2001 (ACT), s 120(2)-(3). intention as to the operation of a particular law, a severance clause of that kind takes effect as a general declaration of the contingent intention of the legislature that if a law in the form enacted would operate to transgress a constitutional limitation on legislative power then the law is still to operate to the extent constitutionally permitted. should be carried The settled effect of a severance clause is "to reverse the presumption that a statute is to operate as a whole, so that the intention of the legislature is to be taken prima facie to be that the enactment should be divisible and that any parts into effect found constitutionally unobjectionable independently of those which fail"81. The result, in other words, is that "legislation, found partially invalid, must be treated as distributable or divisible, unless it appears affirmatively that it was not part of the legislative intention that so much as might have been validly enacted should become operative without what is bad"82. That operation of a severance clause to "require that an entirely artificial construction shall be placed on a statute found to be invalid in part in order to save so much of it as might have been validly enacted" can arise, according to orthodox analysis, in either of two categories of case. One is where "it is found that particular clauses, provisos or qualifications, which are the subject of distinct or separate expression, are beyond the power of the legislature". The other is where "a provision which, in relation to a limited subject matter or territory, or even class of persons, might validly have been enacted, is expressed to apply generally without the appropriate limitation, or to apply to a larger subject matter, territory or class of persons than the power allows"83. The difference between the primary principle of construction and the presently relevant secondary principle of construction can be illustrated by contrasting the reasoning of different members of the majority in Coleman v Power84 ("Coleman"). Construing a statutory prohibition on using "insulting words" in a public place to be confined to words intended or reasonably likely to provoke unlawful physical retaliation, Gummow and Hayne JJ (with whom Kirby J relevantly agreed) gave effect to the primary principle that the prohibition was to be read in a way that would not lead to invalidity85. In 81 Bank of New South Wales v The Commonwealth (1948) 76 CLR 1 at 371; [1948] HCA 7. 82 R v Poole; Ex parte Henry [No 2] (1939) 61 CLR 634 at 651; [1939] HCA 19. 83 R v Poole; Ex parte Henry [No 2] (1939) 61 CLR 634 at 652. 84 (2004) 220 CLR 1; [2004] HCA 39. 85 (2004) 220 CLR 1 at 76-79 [188]-[200], 98-99 [254]-[256]. construing the same statutory prohibition to exclude "insulting words" used in the course of a political communication, McHugh J gave effect to the secondary principle that the prohibition was to be operative to the extent that it was constitutionally unobjectionable86. Constitutional adjudication unnecessary if severance available In R v Poole; Ex parte Henry [No 2]87, Fraser Henleins Pty Ltd v Cody88 and Bank of New South Wales v The Commonwealth89, Dixon J noted that inclusion of severance clauses in legislation had first occurred in the United States in the early part of the twentieth century and that a great deal of consideration had been given there to their operation and effect90. An important effect of severance clauses in the United States has been to support a practice, generally although by no means universally observed91, whereby, in the absence of "'weighty countervailing' circumstances", "one to whom application of a statute is constitutional will not be heard to attack the statute on the ground that impliedly it might also be taken as applying to other persons or other situations in which its application might be unconstitutional"92. The foundation for that practice has been identified as the "elementary principle that the same statute may be in part constitutional and in part unconstitutional, and that if the parts are wholly independent of each other, that which is constitutional may stand while that which is unconstitutional will be rejected"93. 86 (2004) 220 CLR 1 at 55-56 [110]. 87 (1939) 61 CLR 634 at 651. 88 (1945) 70 CLR 100 at 127; [1945] HCA 49. 89 (1948) 76 CLR 1 at 370. 90 See generally Stern, "Separability and Separability Clauses in the Supreme Court" (1937) 51 Harvard Law Review 76 at 115-125. 91 See Fallon, "Fact and Fiction About Facial Challenges" (2011) 99 California Law Review 915. 92 Brockett v Spokane Arcades Inc (1985) 472 US 491 at 502, quoting United States v Raines (1960) 362 US 17 at 21-22. 93 Brockett v Spokane Arcades Inc (1985) 472 US 491 at 502, quoting Allen v Louisiana (1881) 103 US 80 at 83-84. In Tajjour v New South Wales94 ("Tajjour"), I explained with reference to case law and to the explanation given by Barwick CJ in Harper v Victoria95 how and why a similar practice was adopted in Australia as a consequence of the application of severance clauses in matters arising under s 92 of the Constitution during the period between Bank of New South Wales v The Commonwealth and Cole v Whitfield96. In accordance with that practice, severance ordinarily came to be addressed as a threshold issue with the result that, if a statute had a severable operation in its application to commercial conduct that was not within the protection of the freedom of interstate trade understood to be guaranteed by s 92, a person engaged in that conduct would not be heard to challenge the statute on the basis that the statute was invalid in its application to some other commercial conduct that was within the protection of the freedom. What I suggested in Tajjour, and now repeat, is that there are sound reasons for adopting the same approach where the validity of a statute is sought to be impugned on the basis that the statute infringes the implied freedom of political communication97. If the facts to which the statute is claimed to have application are not shown to involve political communication, and if the statute is severable to the extent that the statute has application to political communication, it is worse than nonsensical to require a court to step through each of the three stages of the Lange-Coleman-McCloy-Brown analysis only to dismiss the challenge on the basis that the statute has a valid severable application to the circumstances of the case. Irrespective of what that analysis might reveal about the potential for invalidity in the application of the statute to the circumstances of some other real or imagined case, the High Court should not be obliged to engage in such laborious and fraught work of supererogation. Much less should a busy magistrate. One objection to adopting such an approach, faintly mentioned in argument by the Solicitor-General for Victoria, is that severance can itself give rise to complex questions. So it can; but quite often it doesn't; and it doesn't in this case. Complexity can arise where severance might be effected in a variety of ways, the choice between which is argued to lie in the borderland between 94 (2014) 254 CLR 508 at 586-587 [172]; [2014] HCA 35. 95 (1966) 114 CLR 361 at 371; [1966] HCA 26. 96 (1988) 165 CLR 360; [1988] HCA 18. 97 (2014) 254 CLR 508 at 589 [176]. legislative and judicial power98. Complexity can also arise where severance is argued to distort the legal operation of what would remain of the statute99. Those difficulties do not detract from the proposition that "where a law is intended to operate in an area where Parliament's legislative power is subject to a clear limitation, it can be read as subject to that limitation"100. Severance, in a case to which that proposition is applicable, turns not on curial divination of an "intuitive understanding of the underlying purpose of the plan of the framer of the instrument"; "it is precisely that uncertain and undesirable mode of solution that [a severance clause] supersedes"101. Severance in such a case turns rather on the answer to the straightforward question of whether or not there exists a positive indication of a legislative intention that, contrary to the general presumption, the particular law is not to have a distributive operation but is to apply in its totality if it is to apply at all102 with the result that all are to go free unless all are bound103. Severance in this case There is no difficulty reading the prohibition against "communicating ... in relation to abortions" in s 185D with para (b) of the definition of "prohibited behaviour" in s 185B(1) of the Public Health Act to exclude political communication. The determination of whether s 185D would be read in that way in the event of the prohibition being invalid in its application to political communication accordingly comes down to asking whether there is something in the text or context of the Public Health Act to indicate that, contrary to the presumption favouring severance expressed in the Interpretation Act, the 98 Victoria v The Commonwealth (Industrial Relations Act Case) (1996) 187 CLR 416 at 502; [1996] HCA 56, referring to Pidoto v Victoria (1943) 68 CLR 87 at 108; [1943] HCA 37. 99 Victoria v The Commonwealth (Industrial Relations Act Case) (1996) 187 CLR 416 at 502; Bank of New South Wales v The Commonwealth (1948) 76 CLR 1 at 100 Victoria v The Commonwealth (Industrial Relations Act Case) (1996) 187 CLR 101 Australian National Airways Pty Ltd v The Commonwealth (1945) 71 CLR 29 at 93; [1945] HCA 41. 102 Knight v Victoria (2017) 261 CLR 306 at 325 [35], quoting Victoria v The Commonwealth (Industrial Relations Act Case) (1996) 187 CLR 416 at 502 and Pidoto v Victoria (1943) 68 CLR 87 at 108. 103 R v Poole; Ex parte Henry [No 2] (1939) 61 CLR 634 at 652. prohibition is to have no application to any communication if the prohibition can have no application to political communication. As Mrs Clubb accepts, and as the reasons for judgment of Gordon J demonstrate, the answer to that question is There remains for me to address the only real argument put on behalf of Mrs Clubb in response to severance. The argument is that severance of the offence-creating provision which she was found to have breached, to exclude political communication, would cast the onus on the prosecution to prove beyond reasonable doubt that the conduct with which she was charged was not political communication, and that the prosecution did not so prove in this case. That is not how severance works at all. If the statutory prohibition were invalid but severed in its application to political communication, the effect of severance would not be to alter the statement of the obligation created by the prohibition, but to take political communication outside the scope of its operation. Severance would operate in substance to require recognition of a statutory exception for prohibited behaviour which amounts to political communication. Whether or not conduct the subject of a charge amounts to political communication is a question of constitutional fact in respect of which the whole notion of a legal onus of proof is inapposite104. Neither the statutory rule in Victoria that an accused who wishes to rely on an exception must present evidence that suggests a reasonable possibility of the existence of facts establishing the exception105 nor the common law rule which would cast the burden on the accused to prove the existence of facts establishing the exception on the balance of probabilities106 therefore have application. Whether valid in its entirety or invalid and severable in its application to political communication, the statutory prohibition must be treated by a court as applicable according to its terms to conduct proved by the prosecution absent the court being apprised of material sufficiently probative for the court to be satisfied that the conduct amounted to political communication. If the freedom of political communication was to be relied on to impugn her prosecution for the offence created by s 185D of the Public Health Act, the 104 Thomas v Mowbray (2007) 233 CLR 307 at 514-522 [620]-[639]; [2007] HCA 33; Maloney v The Queen (2013) 252 CLR 168 at 298-299 [351], [355]; [2013] HCA 105 Section 72 of the Criminal Procedure Act 2009 (Vic). 106 Dowling v Bowie (1952) 86 CLR 136 at 139-140; [1952] HCA 63; Ex parte Ferguson; Re Alexander (1944) 45 SR (NSW) 64 at 66-67. practical onus was on Mrs Clubb to bring such material forward. She did not do Mr Preston was engaged in political communication when he stood on the footpath outside the Specialist Gynaecology Centre located in a building in Victoria Street, Hobart on 5 and 8 September 2014 and again on 14 April 2015 holding placards containing words and images indicating his opposition to abortion. There is no suggestion that the words and images cloaked a communication which was essentially personal or commercial107. Mr Preston gave evidence that he sought to inform and to challenge the conscience of women entering the centre but, as he also made clear in his evidence, that was not his only purpose. The words and images on his placards conveyed a message to the world at large. His placards were visible to persons who might enter or attempt to enter the Specialist Gynaecology Centre but also to all who might pass Mr Preston was, in the language of para (b) of the definition of "prohibited behaviour" in s 9(1) of the Reproductive Health (Access to Terminations) Act 2013 (Tas) ("the Reproductive Health Act"), engaged in "a protest" – a public demonstration of opposition, disapproval or discontent – "in relation to terminations" – on the subject matter of abortion. So much was common ground in his trial in the Magistrates Court of Tasmania for the offence created by s 9(2) of the Reproductive Health Act, of which he was convicted by that Court108. Unlike the constitutional question sought to be raised in Mrs Clubb's appeal, the question of whether the protest prohibition in the Reproductive Health Act freedom of political communication, having been raised by Mr Preston at his trial and again in so much of his appeal to the Supreme Court of Tasmania as has been removed by order under s 40 of the Judiciary Act, is ripe for determination by the High Court. implied constitutional infringes the The parties to the appeal and interveners all accept that the question of whether the protest prohibition infringes the implied constitutional freedom of political communication falls to be determined in the application of the three- staged Lange-Coleman-McCloy-Brown analysis. There are differences between them as to the propriety and utility of importing into the third stage of that analysis (concerned with determining whether an impugned law is reasonably 107 cf APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 351 [28]; [2005] HCA 44. 108 Police v Preston and Stallard (unreported, Magistrates Court of Tasmania, 27 July appropriate and adapted to advance an identified constitutionally permissible purpose in a manner compatible with maintenance of the constitutionally prescribed system of representative and responsible government) a further three stages of structured proportionality analysis. The three stages of the Lange-Coleman-McCloy-Brown analysis are anchored in our constitutional structure. They are part of our constitutional doctrine. Their application is mandated by precedent. Structured proportionality has not been suggested to be more than an intellectual tool109. That there continue to be differences of opinion about the propriety and utility of importing the three stages of the structured proportionality analysis is hardly surprising. The Australian constitutional tradition derives from that of the common law. Lawyers brought up in the tradition of the common law are comfortable with the application of precedent. Lawyers brought up in that tradition are less than comfortable with being constrained to adopt a standardised pattern of thought and expression in determining whether a given measure in a given context can be justified as reasonable or appropriate or adapted to an end. We value predictability of outcomes more than we value adherence to analytic forms. We have learned through long and sometimes bitter experience that "[l]inguistic refinement of concept" can "result in fineness of distinction which makes it ever more difficult to predict a course of judicial decision" whereas "an overtly imprecise concept can yield a degree of certainty in application, provided the reasons for choice are also made as overt as we can"110. My own reservations about structured proportionality have been outlined in the past111. Nothing is to be gained by me elaborating further on those reservations. Nor would it contribute to the elaboration of my reasons for judgment in this case for me to demonstrate my knowledge of the competing strands of argument within the contemporary debate amongst pan-constitutional proponents of structured proportionality about what each of the three (or sometimes more) stages of analysis involves and why each stage is or should be 109 McCloy v New South Wales (2015) 257 CLR 178 at 213 [68]; [2015] HCA 34; Murphy v Electoral Commissioner (2016) 261 CLR 28 at 52 [37], 60-61 [62]; [2016] HCA 36. 110 Jacobs, "The Successor Books to 'The Province and Function of Law' – Lawyers' Reasonings: Some Extra-judicial Reflections" (1967) 5 Sydney Law Review 425 at 428, quoted in Stellios, Zines's The High Court and the Constitution, 6th ed (2015) 111 McCloy v New South Wales (2015) 257 CLR 178 at 234-238 [140]-[149]; Murphy v Electoral Commissioner (2016) 261 CLR 28 at 71-72 [99]-[101]; Brown v Tasmania (2017) 261 CLR 328 at 376-377 [157]-[161]; [2017] HCA 43. undertaken. The articulation and application of the stages of analysis have in practice varied from time to time and from place to place and have in practice been influenced by marked differences in institutional settings and in intellectual traditions. There is something of a gap between rhetoric and practice and much, I fear, can be lost in translation. the the third stage address Just as my reservations about structured proportionality have been outlined in the past, so my reasons have been set out in the past for considering it appropriate requisite Lange-Coleman-McCloy-Brown analysis by applying a precedent-based calibrated scrutiny. The approach seeks to address the stage in a way which adjusts the level of scrutiny brought to bear on an impugned law to the nature and intensity of the risk which the burden imposed by the law on political communication poses for the constitutionally prescribed system of representative and responsible government112. I doubt my capacity to spell out the approach with greater clarity, and I doubt that there is much more that I can usefully say in support of it at the level of constitutional and adjudicative principle. Like all of the numerous competing approaches to the judgment calls required of the High Court in matters arising under the Australian Constitution which have come and gone since 1903, it will be evaluated over time as case law accumulates by reference to its capacity to inform sound and consistent outcomes. Consistently with the structure of my reasons for judgment in Brown v Tasmania113 ("Brown"), which also concerned on-site protesting, the framework for the analysis which I propose to undertake in the present case is: first, to examine the nature and intensity of the burden which the protest prohibition places on political communication; second, to calibrate the appropriate level of scrutiny to the risk which a burden of that nature and intensity poses to maintenance of the constitutionally prescribed system of representative and responsible government; third, to isolate and assess the importance of the constitutionally permissible purpose of the prohibition; and finally, to apply the appropriate level of scrutiny so as to determine whether the protest prohibition is justified as reasonably appropriate and adapted to achieve that purpose in a manner compatible with maintenance of the constitutionally prescribed system of government. 112 Tajjour v New South Wales (2014) 254 CLR 508 at 576-581 [139]-[152]; McCloy v New South Wales (2015) 257 CLR 178 at 222-234 [99]-[139], 238-239 [150]- [154]; Brown v Tasmania (2017) 261 CLR 328 at 377-379 [162]-[166]. 113 (2017) 261 CLR 328 at 377-379 [162]-[166]. Burden Understanding the nature and intensity of the burden which the protest prohibition places on political communication can be assisted by isolating a number of aspects of the legal and practical operation of the prohibition. First, the prohibition is specifically directed against engaging in a protest: a public demonstration – the oldest and most orthodox form of public expression of political dissent in a representative democracy. The juxtaposition of paras (a) and (b) of the definition of "prohibited behaviour" makes clear that the prohibition is not confined to a prohibition on engaging in a protest that besets, harasses, intimidates, interferes with, threatens, hinders, obstructs or impedes any person. The prohibition extends to peaceful demonstration. It extends to a picket. It extends to a silent vigil. Second, the protest prohibition is content-specific. The prohibition is limited to a prohibition against engaging in a protest on the subject of abortion. The availability of abortion has been restricted by State and Territory legislation throughout Australian history and has been able to be affected by Commonwealth legislation applicable in every State at least since the insertion of s 51(xxiiiA) into the Constitution in 1946. Beginning in the 1950s and gaining momentum in the 1970s, abortion has been the focus of agitation for legislative change first by pro-choice activists arguing for, and then by pro-life activists arguing against, its liberalisation114. Unlike in the United States115 and in Canada116, where the movement towards liberalisation of abortion received impetus from landmark constitutional decisions resulting in uniform national constraints on continuing state or provincial legislative restrictions, liberalisation of abortion in Australia has occurred through legislation enacted at various times in each State and self- governing Territory117. In Tasmania, abortion remained a crime subject to limited defences until 2001 when a medical exception was introduced118. Only with the enactment of the Reproductive Health Act in 2013 was abortion decriminalised in Tasmania. Abortion has since then been an offence in 114 Munson, The Making of Pro-life Activists (2008) at 77-89. 115 Roe v Wade (1973) 410 US 113. 116 R v Morgentaler [1988] 1 SCR 30. 117 See Victorian Law Reform Commission, Law of Abortion: Final Report (2008) at 118 Criminal Code Amendment Act (No 2) 2001 (Tas). Tasmania only where carried out other than by a medical practitioner or the pregnant woman, or where carried out without the woman's consent119. The legislative changes which have occurred in Australia have not been without dissent and the legislated accommodation reached has not removed abortion from the realm of public controversy. No doubt there can be communications on the subject of abortion which have no substantial bearing on legislative possibilities and therefore no substantial bearing on electoral choice. Mrs Clubb's attempted communication with the couple outside the East Melbourne Fertility Control Clinic may well have been one. And no doubt there can arise factual questions of some delicacy as to whether particular conduct (such as silent prayer) might in particular circumstances amount to a public demonstration answering the statutory description of a protest. But it is barely conceivable that there could be a public demonstration relating to abortion which does not involve some explicit or implicit expression of approval or disapproval of the currently legislated position. A protest on the subject of abortion is inherently political. Third, the protest prohibition is site-specific. The prohibition operates only within a radius of 150 m around premises which provide abortion services. The perimeter marks out an "access zone" (equally capable of being referred to as a "safe zone", "safe access zone", "buffer zone" or "bubble zone"120) within which no public demonstration on the subject of abortion is permitted to be seen or heard. Fourth, the protest prohibition is in its practical operation time-specific. The requirement that the protest be able to be seen or heard by a person accessing, or attempting to access, premises at which abortions are provided means that the prohibition can only operate to restrict protest activity at times when those premises are available to be accessed. An argument that the same requirement means that a protest within the access zone is prohibited only if it is able to be seen or heard by a person from the vantage point of entering or being about to enter the premises was pressed on and accepted by the Magistrate121 but was abandoned by the Solicitor-General for Tasmania on behalf of the prosecution in the course of oral submissions in the appeal. 119 Sections 178D and 178E of the Criminal Code (Tas). 120 Drabsch, Abortion and the law in New South Wales, New South Wales Parliamentary Library Research Service, Briefing Paper No 9/05 (2005) at 58-59. 121 Police v Preston and Stallard (unreported, Magistrates Court of Tasmania, 27 July Fifth, although the prohibition is viewpoint-neutral in its legal operation, the prohibition in its practical operation impacts differentially on pro-choice and pro-life activists. That is to say, acknowledging that the prohibition would prevent the holding of a pro-choice protest just as it would prevent the holding of a pro-life protest, the real-world effect of the prohibition operating only within a radius of 150 m around premises which provide abortion services can only be that the prohibition curtails protests by those who seek to express disapproval of the availability of services of the kind provided at the premises to a significantly greater extent than it curtails protests by those who seek to express approval. That is certainly how the prohibition was expected to work in practice, as was spelt out by the Minister for Health on the reading of the Bill for the Reproductive Health Act for a second time in the Tasmanian House of Assembly. After explaining that the prohibition would not stop a sermon in a church or "an exchange of personal views between mates at a restaurant or pub", the Minister said122: "It will, however, stop a person from standing in an access zone holding up a placard or handing out pamphlets denouncing terminations. It will stop a person from engaging in vocal anti-choice protest and it will stop the silent protests outside termination clinics that purport to be a vigil of sorts or a peaceful protest but which, by their very location, are undoubtedly an expression of disapproval." There is no reason to think that the prohibition does not measure up to that expectation. Mr Preston's circumstances well illustrate that the prohibition operates to stop peaceful protests against abortion which would otherwise occur within a radius of 150 m around premises at which abortion services are provided in Tasmania. His own largely solitary protests outside the Specialist Gynaecology Centre which resulted in his conviction cannot be treated as isolated instances. Mr Preston gave evidence that, together with others, he had been engaged in pro- life lobbying, education and protesting elsewhere in Australia since 1990. Evidence adduced in Clubb v Edwards and accepted by the parties to be available to be taken into account on questions of legislative or constitutional fact in the present case reveals that pro-life protesters, typically in groups of between three and 12 but sometimes numbering up to 100, had stood outside the East Melbourne Fertility Control Clinic almost every morning for a quarter of a century up to May 2016. 122 Tasmania, House of Assembly, Parliamentary Debates (Hansard), 16 April 2013 at There is a difference between this case and Brown to which the prosecution and the Commonwealth, State and Territory interveners draw attention. The difference is that there is no evidence that on-site protesting of the kind engaged in by Mr Preston has the particular communicative power of generating sounds and images that can be expected to be broadcast to a wider audience123. In contrast to pro-conservation protests in forests over the past quarter century, pro-life protests outside abortion clinics over the same period can be accepted to have been largely ignored in the mainstream media. The difference is of no moment. The protection of the implied freedom is not greater for those who are media-savvy or for those whose causes have popular appeal. The important feature that this case has in common with Brown is that it involves legislation which impedes the holding of a protest in close proximity to the place of occurrence of a currently lawful activity, at which those who oppose the lawfulness of the occurrence of that activity would seek publicly to express their disapproval. In a manner not qualitatively different from the legislation directed against on-site protesting in Brown124, the burden which the protest prohibition places on political communication The prohibition discriminates on its face against a traditional form of political communication and discriminates in its practical operation against use of that form of communication to express a particular viewpoint. is direct, substantial and discriminatory. Calibration The Attorney-General for Victoria submits that no greater justification for the burden on political communication is required than showing a rational connection between the prohibition and a constitutionally permissible purpose. I reject that submission. To search for no more than a rational connection between the prohibition and a constitutionally permissible purpose is to apply a level of scrutiny appropriate to be applied to a law which imposes a burden on political communication that is no more than indirect or incidental125. That level of scrutiny is inappropriate to be applied to laws "which prohibit or regulate communications which are inherently political or a necessary ingredient of political communication"126. Much less is that level of scrutiny appropriate to be 123 cf Brown v Tasmania (2017) 261 CLR 328 at 346 [32]. 124 (2017) 261 CLR 328 at 389 [199]. 125 eg, Hogan v Hinch (2011) 243 CLR 506 at 555-556 [95]-[99]; [2011] HCA 4. 126 Wotton v Queensland (2012) 246 CLR 1 at 16 [30]; [2012] HCA 2. applied to a law which in its practical operation discriminates against political communication that expresses a particular point of view. The reason why that minimal level of scrutiny is inappropriate here is that it fails to align the requisite standard of justification with the level of risk which a burden of the identified nature poses to maintenance of the constitutionally the prescribed system of safeguarding of which is the structural purpose of the freedom of political communication127. The constitutionally prescribed system of representative and responsible government is characterised by the tolerance of dissenting minority opinion. responsible government, representative and The Attorney-General of the Commonwealth, with the support of the Attorney-General for New South Wales, suggests that some assistance is to be gained in considering the appropriate level of scrutiny and corresponding standard of justification from an examination of the approach taken to time, place and manner of determining whether communications infringe the express guarantee of freedom of speech in the First Amendment to the Constitution of the United States. I agree. laws restricting the The First Amendment's guarantee of freedom of speech has come to be understood as a personal right extending beyond political communication. "[S]peech which bears, directly or indirectly, upon issues with which voters have to deal" has nevertheless long been understood to have the greatest claim to protection under the First Amendment128. Aspects of First Amendment case law and scholarship can for that reason be instructive in considering the implied freedom of political communication. First Amendment case law and scholarship have been drawn upon extensively by the High Court from the earliest articulation of the implied freedom in Nationwide News Pty Ltd v Wills129 and Australian Capital Television Pty Ltd v The Commonwealth130. Reference to them is appropriately continued as our own body of case law develops, provided 127 Brown v Tasmania (2017) 261 CLR 328 at 378 [164]. See also McCloy v New South Wales (2015) 257 CLR 178 at 214 [70], 238-239 [150]-[152]. 128 Meiklejohn, Political Freedom (1960) at 79, quoted in Theophanous v Herald & Weekly Times Ltd (1994) 182 CLR 104 at 124; [1994] HCA 46. 129 (1992) 177 CLR 1; [1992] HCA 46. 130 (1992) 177 CLR 106; [1992] HCA 45. that it is constantly borne in mind that danger lies in "uncritical translation" of any foreign doctrine131. Instructively for present purposes, the Supreme Court of the United States has repeatedly held that a time, place or manner restriction on freedom of speech will withstand First Amendment scrutiny provided the restriction: (1) is content- neutral; (2) serves a significant governmental interest; and (3) is narrowly tailored to serve that interest in the sense that it does not burden substantially more speech than is necessary to serve that interest, and leaves open ample alternative channels for communication132. A content-based time, place or manner restriction, on the other hand, will withstand First Amendment scrutiny only if the restriction is narrowly tailored to promote a compelling governmental interest133. Leaving precise verbal formulations to one side, the notion that a content-based time, place or manner restriction demands closer scrutiny corresponding to a need for greater justification than a content-neutral time, place or manner restriction is consistent with the approach taken to the implied freedom of political communication by Mason CJ in Australian Capital Television Pty Ltd v The Commonwealth134 and by Gaudron J in Levy v Victoria135 as subsequently endorsed by Gleeson CJ in Mulholland v Australian Electoral Commission136 and unanimously applied in Hogan v Hinch137. The time, place and manner restriction on political communication held to withstand implied freedom scrutiny in Levy was a content-neutral restriction found to involve "no greater curtailment of the constitutional freedom than was reasonably 131 Roach v Electoral Commissioner (2007) 233 CLR 162 at 178 [17]; [2007] HCA 43. See also McCloy v New South Wales (2015) 257 CLR 178 at 229 [120]. 132 eg, Ward v Rock Against Racism (1989) 491 US 781 at 791, citing Clark v Community for Creative Non-Violence (1984) 468 US 288 at 293. 133 eg, United States v Playboy Entertainment Group Inc (2000) 529 US 803 at 813. 134 (1992) 177 CLR 106 at 143-144. 135 (1997) 189 CLR 579 at 618-619; [1997] HCA 31, referring to Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 143, 169, 234- 235, Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 76-77, Cunliffe v The Commonwealth (1994) 182 CLR 272 at 299-300, 337-339, 388; [1994] HCA 44 and Kruger v The Commonwealth (1997) 190 CLR 1 at 126-128; [1997] HCA 27. 136 (2004) 220 CLR 181 at 200 [40]; [2004] HCA 41. 137 (2011) 243 CLR 506 at 555-556 [95]-[99]. necessary to serve the public interest in the personal safety of citizens"138. The time, place and manner restriction on political communication later held to withstand implied freedom scrutiny in Attorney-General (SA) v Adelaide City Corporation139 was similarly content-neutral. Confined relevantly to preaching, canvassing or haranguing on a public road without prior permission of a local council, the granting or withholding of which could not validly be based on approval or disapproval of the content of the communication, and having no application to communications during an election period or in a designated area known as "Speakers Corner", the restriction was found adequately to balance "the competing interests in political communication and the reasonable use by others of a road"140. Later in these reasons, I will turn to the assistance to be derived from cases in which the Supreme Court of the United States has considered time, place and manner restrictions creating buffer zones around premises providing abortion services141. Suffice it for the present to record that I find unpersuasive the prevailing view of a majority of the Supreme Court that prohibitions on communicative activity in buffer zones are content-neutral142. With the minority, I think that "[i]t blinks reality to say ... that a blanket prohibition on the use of streets and sidewalks where speech on only one politically controversial topic is likely to occur – and where that speech can most effectively be communicated – is not content based"143. That said, unlike the impugned prohibition here and unlike the buffer zone legislation considered in two cases in British Columbia arising under the Canadian Charter of Rights and Freedoms ("the Canadian Charter") to which I will also later turn144, none of the First Amendment buffer zone cases have involved a legislated time, place and manner restriction cast in terms of a prohibition against holding a protest. 138 (1997) 189 CLR 579 at 614. See also at 597-598, 619-620, 627-628, 647-648. 139 (2013) 249 CLR 1; [2013] HCA 3. 140 (2013) 249 CLR 1 at 64 [141]. See also at 44 [68], 84 [203], 90 [224]. 141 Madsen v Women's Health Center Inc (1994) 512 US 753; Schenck v Pro-Choice Network of Western New York (1997) 519 US 357; Hill v Colorado (2000) 530 US 703; McCullen v Coakley (2014) 134 S Ct 2518. 142 McCullen v Coakley (2014) 134 S Ct 2518 at 2531. 143 McCullen v Coakley (2014) 134 S Ct 2518 at 2543. 144 R v Lewis (1996) 139 DLR (4th) 480; R v Spratt (2008) 298 DLR (4th) 317. The burden which the protest prohibition places on political communication, as I have already concluded, is direct, substantial and discriminatory. That being so, my opinion is that the burden could only be justified as reasonably appropriate and adapted to advance a legitimate purpose in a manner that is compatible with maintenance of the constitutionally prescribed system of government if it can withstand the same close scrutiny consistent with a compelling justification which I considered was required of the legislation which operated to prohibit on-site protesting in Brown145. Two conditions, in my opinion, therefore need to be satisfied for the burden to be justified. The first is that the purpose of the prohibition needs to be more than just constitutionally permissible; it needs to be compelling. The second is that the prohibition needs to be closely tailored to the achievement of that purpose; it must not burden the freedom of political communication significantly more than is reasonably necessary to do so. In other words, for the protest prohibition to withstand scrutiny under the final stages of the Lange-Coleman-McCloy-Brown analysis, the burden imposed by the prohibition on political communication needs to be in pursuit of a compelling governmental purpose and needs to be no greater than is reasonably necessary to achieve that purpose. Purpose The Reproductive Health Act contains no statement of legislative objects. The purpose of the protest prohibition – the "public interest sought to be protected and enhanced" by its enactment146 – therefore falls to be determined inferentially by reference to its subject matter, text and context147. Mr Preston submits that the singling out of protests reveals that the purpose of the protest prohibition is the quietening of political dissent on the subject matter of abortion. That characterisation of legislative purpose does not adequately account for the statutory creation of an "access zone" and for the complementary operation of other elements of the definition in s 9(1) of the Reproductive Health Act of "prohibited behaviour" within an access zone. The inclusion within the definition by paras (a), (c) and (d) of "besetting, harassing, intimidating, interfering with, threatening, hindering, obstructing or impeding" a person, "footpath interference in relation to terminations" and "intentionally recording ... a person accessing or attempting to access premises ... without that 145 (2017) 261 CLR 328 at 390-391 [203]-[204]. 146 Cunliffe v The Commonwealth (1994) 182 CLR 272 at 300. 147 Brown v Tasmania (2017) 261 CLR 328 at 391-392 [208]-[209]. person's consent", together with the catch-all reference in para (e) to "any other prescribed behaviour", indicates that the overall concern of the proscription by s 9(2) of "prohibited behaviour" within an "access zone" is the elimination of conduct of kinds which have been shown in the past or which might be shown in the future to have a tendency to hinder or deter access to premises at which abortion services are provided. That inference as to the legislative purpose underlying the protest prohibition is supported by the Second Reading Speech for the Bill for the Reproductive Health Act. The Minister for Health there referred to a study of patients at the East Melbourne Fertility Control Clinic which indicated that "patients experience considerable distress, shame and anxiety in response to protestors"148. The Minister went on to express the belief that "[w]omen are entitled to access termination services in a confidential manner without the threat of harassment" and that "access zones provide the appropriate balance between the right to protest and protecting women from being exposed to those who seek to shame and stigmatise them"149. Drawing those threads together, the Solicitor-General for Tasmania submits for the prosecution that the protest prohibition has the multiple purposes of maintaining the safety, privacy, well-being and dignity of persons entering and leaving premises at which abortion services are provided. Each of those purposes, he argues, is compatible with maintenance of the constitutionally prescribed system of representative and responsible government. Each, he says, is "in the interests of an ordered society"150. For his part, Mr Preston concedes that protecting physical safety and protecting privacy are compatible with maintenance of the constitutionally prescribed system of representative and responsible government. Mr Preston argues, however, that protecting the psychological well-being or dignity of a person from the consequences of a political communication is not. Relying on passages in reasons for judgment of the majority in Coleman151 and of three members of the evenly divided High Court in Monis v The Queen152 ("Monis"), 148 Tasmania, House of Assembly, Parliamentary Debates (Hansard), 16 April 2013 at 149 Tasmania, House of Assembly, Parliamentary Debates (Hansard), 16 April 2013 at 150 Quoting Levy v Victoria (1997) 189 CLR 579 at 608. 151 (2004) 220 CLR 1 at 45-46 [81], 77 [193], 87 [226]. See also Roach v Electoral Commissioner (2007) 233 CLR 162 at 200 [87]. 152 (2013) 249 CLR 92 at 133-134 [73], 139-140 [97], 178 [236]; [2013] HCA 4. Mr Preston argues that maintenance of the constitutionally prescribed system of government demands tolerance of political communication that is unwelcome and offensive. The Attorney-General for Victoria meets Mr Preston's submission head on with a submission that is equally categorical but to the exact opposite effect. Extrapolating from a statement in Brown153, and marginalising both the reasoning and the outcomes in Coleman and in Monis, the Attorney-General for Victoria argues that the implied freedom of political communication is a guarantee of freedom to communicate only with willing recipients. Neither the argument of Mr Preston nor the argument of the Attorney- General for Victoria can be accepted. Each argument implicitly, and derivatively, incorporates elements of an approach that has been adopted by the Supreme Court of the United States when dealing with time, place and manner restrictions on freedom of speech. However, neither argument reflects the richness of the approach in the United States, and neither argument adequately relates that approach to the implied freedom of political communication. The Supreme Court of the United States has repeatedly recognised that there are circumstances in which freedom of speech can legitimately be curtailed by time, place and manner restrictions protective of an "unwilling listener's interest in avoiding unwanted communication"154. In Hill v Colorado, a significant buffer zone case about which I will need to say more, a majority of the Supreme Court referred to that interest of an unwilling listener as an aspect of a broader "right to be let alone". The majority immediately added, however, that the "right" was "more accurately characterized as an 'interest' that States can choose to protect in certain situations"155. Before and after Hill v Colorado, the approach of the Supreme Court has been to treat the interest of an unwilling listener in avoiding unwanted communication as significant in some situations but not in others. For the most part, an interest in avoiding unwanted communication has been found to be capable of justifying sufficiently tailored restrictions on the freedom of speech 153 (2017) 261 CLR 328 at 415 [275]. 154 Hill v Colorado (2000) 530 US 703 at 716. 155 (2000) 530 US 703 at 717 n 24, referring to Katz v United States (1967) 389 US 347 at 350-351. See generally at 716-718. only where unwilling listeners have in some way been "captive" to unwanted and intrusive speech156. Unsolicited, unwelcome, uncivil or offensive political communication is not carved out as an exception from the freedom of political communication impliedly guaranteed by ss 7, 24, 61, 64 and 128 of the Constitution. To acknowledge such a carve-out would turn the approach to the implied freedom of political communication in the unfortunate direction of that long-jettisoned unworkable approach to s 92 of the Constitution which sought to draw a trade or commerce and conduct extra distinction between commercium157. legitimate Coleman and Monis should not be understood as authority for the proposition that a purpose of curtailing unsolicited, unwelcome, uncivil or offensive speech is incompatible with the constitutionally prescribed system of representative and responsible government. Consistently with how the Supreme Court of the United States has treated the interest of an unwilling listener in avoiding unwanted communication, the better explanation of those decisions is that protecting against unwanted or offensive communication is a permissible purpose the capacity of which to justify a burden on freedom of political communication can vary in different contexts. In some contexts, the purpose of protecting against unwanted or offensive communication can be insignificant. In other contexts, of which the present in my opinion is one, the purpose of protecting against unwanted or offensive communication can be compelling. In my opinion, the purpose of the protest prohibition as an element of s 9(2)'s proscription of "prohibited behaviour" within an "access zone" is best identified as being to ensure that women have access to premises at which abortion services are lawfully provided in an atmosphere of privacy and dignity. The purpose so identified is unquestionably constitutionally permissible and, by any objective measure, of such obvious importance as to be characterised as compelling. 156 See "Too Close for Comfort: Protesting Outside Medical Facilities" (1988) 101 Harvard Law Review 1856 at 1863-1866; Phillipps, "The Unavoidable Implication of McCullen v Coakley: Protection Against Unwelcome Speech Is Not A Sufficient Justification For Restricting Speech in Traditional Public Fora" (2015) 47 Connecticut Law Review 937 at 944-950. 157 Compare R v Martin; Ex parte Wawn (1939) 62 CLR 457; [1939] HCA 39 and Mansell v Beck (1956) 95 CLR 550; [1956] HCA 70 with Betfair Pty Ltd v Western Australia (2008) 234 CLR 418; [2008] HCA 11. That identification of legislative purpose accords substantially with the purpose which the Supreme Court of British Columbia in R v Lewis158 and the Court of Appeal of British Columbia in R v Spratt159 identified as the purpose of a prototypical prohibition against "protest" within a legislated buffer zone and which those courts characterised as "pressing and substantial". It accords also with the United States Supreme Court's recognition of protecting a woman's freedom to seek pregnancy-related services as a significant governmental interest160. Justification The public interest sought to be protected and enhanced by the protest prohibition being both constitutionally permissible and compelling, the question that remains is whether the burden which the protest prohibition imposes on political communication is significantly more than is reasonably necessary to give effect to that purpose. the obvious argument the Victorian prohibition against that "communicating by any means in relation to abortions in a manner that is able to be seen or heard by a person accessing, attempting to access, or leaving premises at which abortions are provided and is reasonably likely to cause distress or anxiety" in s 185D read with s 185B(1) of the Public Health Act is a considerably less restrictive means of achieving the purpose of the protest prohibition, the response of the Solicitor-General for Tasmania and of the interveners is to invoke the approach of the Court of Appeal of British Columbia in R v Spratt. The response is to say that it was open to the Tasmanian Parliament to take the view that "[t]o try to characterize each individual approach to every woman entering the clinic is too difficult a calculus when the intent of the legislation is to give unimpeded access to those entering the clinic" and, thus, that "a clear rule against any interference [was] the best way to achieve the ends of the legislation"161. Bright lines can have benefits. Their appropriateness depends on how and where they are drawn. The quoted words were uttered in R v Spratt in the context of accepting as "justified in a free and democratic society", within the meaning of s 1 of the Canadian Charter, a restriction on freedom of expression 158 (1996) 139 DLR (4th) 480 at 508-511 [87]-[102]. 159 (2008) 298 DLR (4th) 317 at 327 [32], 336-337 [71], [75]. 160 Madsen v Women's Health Center Inc (1994) 512 US 753 at 767-768; Schenck v Pro-Choice Network of Western New York (1997) 519 US 357 at 376; Hill v Colorado (2000) 530 US 703; McCullen v Coakley (2014) 134 S Ct 2518. 161 (2008) 298 DLR (4th) 317 at 338-339 [80]-[81] (emphasis in original). wrought by a prohibition against "protest"162 applicable within a buffer zone which did not exceed 50 m from the boundary of the parcel of land on which a facility providing abortion services was located163. The same prohibition within the same buffer zone had earlier been in issue in R v Lewis. In this case, the perimeter set for the operation of the protest prohibition has a radius that is three times that distance. None of the cases in the Supreme Court of the United States have involved buffer zones as extensive in their geographical reach. Hill v Colorado concerned a buffer zone extending 100 feet from the entrance to a health care facility. The prohibition within that zone, which was upheld by a majority, was against knowingly approaching a non-consenting person within eight feet "for the purpose of passing a leaflet or handbill to, displaying a sign to, or engaging in oral protest, education, or counseling with [that] person"164. McCullen v Coakley165 concerned a wider prohibition applicable within a narrower zone. The buffer zone in that case extended no more than 35 feet from the entrance to a place where abortions were offered or performed. The prohibition unanimously struck down in that case was against knowingly standing on a sidewalk within that zone166. Earlier, in Madsen v Women's Health Center Inc167 ("Madsen") and Schenck v Pro-Choice Network of Western New York168 ("Schenck"), the Supreme Court had considered the compatibility with the First Amendment of injunctions issued by state courts to remedy continuing tortious conduct by pro-life protesters. Madsen relevantly concerned two injunctions, the different fate of which in the Supreme Court is instructive. The first, which was upheld by the Supreme Court, prohibited demonstrating within 36 feet of the entrance to an abortion clinic. The second, which was struck down by the Supreme Court as burdening more speech than was necessary to accomplish its goal, prohibited physically approaching a person who sought the services of the clinic without that person's consent in an area within 300 feet of the clinic. Schenck relevantly 162 Section 2(1)(b) of the Access to Abortion Services Act, RSBC 1996, c 1. 163 (2008) 298 DLR (4th) 317 at 322 [14]. 164 Colorado Revised Statutes, (1999) §18-9-122(3). 165 (2014) 134 S Ct 2518. 166 Massachusetts General Laws (2012), ch 266, §§120E½(a), (b). concerned an injunction which prohibited demonstrating within 15 feet of the entrance to a clinic. The injunction was upheld. More recently, the High Court of Justice of England and Wales concluded on judicial review169 that the establishment by legislative instrument made by a local authority of a "safe zone" around an abortion clinic, within which engaging in an act of approval or disapproval with respect to issues related to abortion services was prohibited, withstood scrutiny as compatible with the freedom of expression guaranteed by Art 10 of the European Convention on Human Rights. The Court took into account that the "safe zone" was a specified geographical area from which was excepted a "designated area" for protests comprising a well- defined grassy space about 100 m from the entrance to the clinic170. Although not specifically concerned with a buffer zone, the decision of the European Court of Human Rights in Annen v Germany171 is also instructive. The Court there held, by a majority of five votes to two, that German courts had violated Art 10 by making and upholding an order that the applicant, an individual, desist from further disseminating in the "immediate vicinity" of a particular abortion clinic leaflets which contained the names of two doctors and asserted that those doctors performed unlawful abortions there. Examining whether the restriction on freedom of expression produced by the order could be characterised as "necessary in a democratic society" within the meaning of Art 10, the majority stated that "in view of the special degree of protection afforded to expressions of opinion which were made in the course of a debate on matters of public interest ... and despite the margin of appreciation enjoyed by the Contracting States, [it came] to the conclusion that the domestic courts failed to strike a fair balance between the applicant's right to freedom of expression and the doctors' personality rights"172. The judgment required to be made by an Australian court when determining whether legislation burdening political communication is reasonably appropriate and adapted to advance a constitutionally permissible purpose in a manner which is compatible with maintenance of the constitutionally prescribed system of government might not in every case be as fine-grained as those made by the North American and European courts in the cases to which I have 169 Dulgheriu v Ealing London Borough Council [2018] 4 All ER 881. 170 [2018] 4 All ER 881 at 887 [13], 906 [89]. 171 European Court of Human Rights, Fifth Section, Application No 3690/10, 26 November 2015. 172 European Court of Human Rights, Fifth Section, Application No 3690/10, 26 November 2015 at 16 [64]. referred173. However, I reject the submission of the Attorney-General of the Commonwealth that an Australian court is not competent to conclude that a its particular prohibition on political communication would advance constitutionally permissible purpose in a manner compatible with maintenance of the constitutionally prescribed system of government if the prohibition were confined to a smaller geographical area (say, an area having a radius of 50 m) but would not advance that purpose in such a manner if extended to a larger geographical area (say, an area having a radius of 500 m). Australian courts have no constitutional mandate to tinker with legislative design in order to improve on the product of democratic choice174. If and to the extent necessary to address the question of whether legislation infringes the implied freedom of political communication in order to determine rights or liabilities in issue in properly constituted proceedings, Australian courts do have a duty to ensure that such burden as a particular democratically chosen legislative restriction places on political communication does not undermine the constitutionally prescribed system of government which made that democratic choice possible. That is the structural imperative which underlies the implication of the freedom of political communication and which frames the ultimate issue to which the Lange-Coleman-McCloy-Brown analysis is directed175. Application of that analysis is an aspect of the unique and essential function of the judicial power. Performance of that function by a court innately involves the exercise of judgment. Unsurprisingly, there will be times when a court's judgment will differ from that of the legislature. Referring to the judgment to be made by the High Court in the application of what the Lange-Coleman-McCloy-Brown analysis, Mason CJ said in Australian Capital Television Pty Ltd v The Commonwealth176: understood stage third now the "In weighing the respective interests involved and in assessing the necessity for the restriction imposed, the Court will give weight to the legislative judgment on these issues. But, in the ultimate analysis, it is for the Court to determine whether the constitutional guarantee has been infringed in a given case." 173 cf Levy v Victoria (1997) 189 CLR 579 at 598. 174 cf Murphy v Electoral Commissioner (2016) 261 CLR 28 at 53 [39], 74 [110]. 175 McGinty v Western Australia (1996) 186 CLR 140 at 286; [1996] HCA 48; McCloy v New South Wales (2015) 257 CLR 178 at 227-228 [114]-[118]. 176 (1992) 177 CLR 106 at 144. Why the protest prohibition was thought by the Tasmanian Parliament appropriate to be applied throughout an access zone having a radius of 150 m from premises at which abortions are provided does not appear from the Second Reading Speech of the Minister for Health or otherwise from the legislative history or the evidence. Perhaps the idea of having an access zone of that dimension was simply borrowed from Victoria without it being thought to make any difference that the Tasmanian protest prohibition was to be more restrictive of political communication than its Victorian equivalent. Perhaps it was thought, consistently with the argument that the protest needs to be able to be seen or heard by a person entering or about to enter the premises which was abandoned in the appeal, that the practical reach of the protest prohibition would be more limited than 150 m through the need to establish that direct line of sight or hearing. Total and permanent prohibition of public expression of political opinion on a particular subject matter within normal working hours within an area defined by a radius of 150 m (covering at least 70,650 m2) in an urban environment is not trivial, and it is not automatically justified by pointing to the ability to express the opinion at other times and places. Were the reach of the protest prohibition to have the effect of preventing a protest on the subject matter of abortion being held at a location meaningfully proximate to a place at which abortion services are provided during the hours of its operation, I would consider enactment of the protest prohibition to be legislative overreach. That is because the prohibition would effectively ban all on-site protests in relation to abortion. To ban all on-site protests in relation to abortion would, in my opinion, suppress political dissent to an extent greater than is reasonably necessary to achieve the permissible and compelling purpose of ensuring that women have access to those premises in an atmosphere of privacy and dignity in a manner compatible with maintenance of the constitutionally prescribed system of government. If I were pressed to re-cast my opinion in the language of structured proportionality, I would say that proscription of all protests in relation to abortion in the proximity of an abortion clinic, even if it were to be accepted as "necessary" ("erforderlich"), would not be "adequate in its balance" ("unzumutbar"). Helpfully, there is a finding of Magistrate Rheinberger (as her Honour then was) which bears on the issue of whether the 150 m reach of the protest prohibition has such an effect. In the course of her comprehensive and well- structured reasons for decision, the Magistrate catalogued a number of specific locations on public streets in Hobart beyond a radius of 150 m from the Specialist Gynaecology Centre in Victoria Street at which protesters remain able to stand and communicate with "a wide number of people who are entering into the access zone for a variety of different reasons"177. That finding of constitutional fact is to my mind decisive. The protest prohibition applies within other access zones each having a radius of 150 m from other premises at which abortion services are provided in Tasmania. There is no evidence as to where those other premises are located. There is accordingly no basis for considering that the circumstances pertaining to the Specialist Gynaecology Centre in Victoria Street are unique or aberrant. The 150 m reach of the protest prohibition around premises at which abortion services are provided must be close to the maximum reach that could be justified as appropriate and adapted to achieve the protective purpose of facilitating access to those premises in a manner compatible with maintenance of the constitutionally prescribed system of government. Nevertheless, I am satisfied that confining the protest prohibition within that 150 m limit leaves enough opportunity for protests to be held at other locations meaningfully proximate to the premises to warrant the conclusion that the burden that the protest prohibition places on political communication, although not insubstantial, is not undue. Conclusion Mr Preston's appeal, in so far as it has been removed into the High Court, must be dismissed. 177 Police v Preston and Stallard (unreported, Magistrates Court of Tasmania, 27 July Nettle 215 NETTLE J. I agree with Kiefel CJ, Bell and Keane JJ that so much of each appeal as has been removed into this Court should be dismissed with costs. My reasons, however, are in some respects different from theirs. The Clubb appeal The threshold question The principal question for decision in the Clubb appeal is whether, by proscribing the kind of conduct identified in para (b) of the definition of "prohibited behaviour" in s 185B(1) of the Public Health and Wellbeing Act 2008 (Vic) ("the PHW Act"), s 185D of the PHW Act imposes an unjustified burden on the implied freedom of political communication. First, however, it is necessary to dispose of what the Attorney-General of the Commonwealth, intervening, referred to as a threshold question of whether the Court should determine that issue. The Attorney-General of the Commonwealth contended that the conduct of the appellant, Mrs Clubb, did not amount to political communication and, therefore, that her argument that s 185D imposes an unjustified burden on the implied freedom of political communication is an academic or hypothetical question which should not be decided. It was submitted that the Court should thus dispose of the matter on the basis that, assuming without deciding that s 185D would so burden the implied freedom of political communication, para (b) of the definition of prohibited behaviour could be read down pursuant to s 6(1) of the Interpretation of Legislation Act 1984 (Vic) as excluding governmental or political communications. That approach was supported by the Attorney-General of Queensland, but opposed by the Attorney-General for Victoria and the Attorney-General for New South Wales. In response, Mrs Clubb submitted that there was insufficient evidence before this Court to determine whether or not her conduct amounted to political communication. Counsel for Mrs Clubb assented to the proposition that he was not in a position to mount a positive case that Mrs Clubb's conduct was a political communication. His position was, however, that, if upon its proper construction the definition of prohibited behaviour excludes political para (b) of communications, the Crown would be required to prove that Mrs Clubb's conduct was not a political communication. The approach of the Attorney-General of the Commonwealth is based on obiter dicta observations of Gageler J in Tajjour v New South Wales178 to the effect that, where an impugned law is attacked as an infringement of the implied freedom of political communication but it appears that potentially offending 178 (2014) 254 CLR 508 at 586-589 [170]-[176]; [2014] HCA 35. Nettle provisions of the law are severable, it may be sufficient to resolve the attack to hold that, assuming without deciding that the impugned law infringes the implied freedom, the potentially offending provisions can be severed. The idea traces back to some earlier decisions of the Court in which it was held or implied that, assuming without deciding that an impugned law were a restriction on the freedom of interstate trade and commerce guaranteed by s 92 of the Constitution, the potentially offending provisions of the law could be read down pursuant to s 15A of the Acts Interpretation Act 1901 (Cth) or cognate Commonwealth or State provisions to the extent necessary to avoid that conclusion179. The Commonwealth also referred to the approach which the Court took180 to an hypothetical issue in Knight v Victoria of what the position would have been in that case if a judicial officer had been appointed to the parole board and was required to decide whether Knight's application for parole should be granted. Ordinarily, the Court would not have regard to the application of a reading down or severance provision to an impugned law unless and until the Court has first come to the view that, according to the natural and ordinary meaning of the impugned law construed in context and having regard to its purpose, the impugned law would be invalid unless read down or unless one or more of its provisions were severed. As Dixon J observed181 in Bank of New South Wales v The Commonwealth on the severance provision in s 6 of the Banking Act 1947 (Cth): "For this reason, no doubt, s 6 is framed as a statement of intention and not as a command addressed to the Court. The question of interpretation is whether, after the extent to which the intended operation of the enactment is invalid has been ascertained, it is nevertheless the expressed will of the legislature that the whole or any part of the rest of the intended operation of the enactment should take effect by itself as a law of the Commonwealth. In so stating the question I have preferred to speak of the 179 Cam & Sons Pty Ltd v The Chief Secretary of New South Wales (1951) 84 CLR 442 at 454, 455 per Dixon, Williams, Webb, Fullagar and Kitto JJ; [1951] HCA 59; Carter v The Potato Marketing Board (1951) 84 CLR 460 at 477, 478; [1951] HCA 60; Grannall v Marrickville Margarine Pty Ltd (1955) 93 CLR 55 at 73 per Dixon CJ, McTiernan, Webb and Kitto JJ, 82 per Fullagar J; [1955] HCA 6; Nominal Defendant v Dunstan (1963) 109 CLR 143 at 151-152; [1963] HCA 5; Harper v Victoria (1966) 114 CLR 361 at 371, 372-373 per Barwick CJ; [1966] HCA 26; Buck v Bavone (1976) 135 CLR 110 at 122-123 per Gibbs J, 131-132 per Mason J; [1976] HCA 24. 180 (2017) 261 CLR 306 at 324-326 [30]-[37]; [2017] HCA 29. 181 (1948) 76 CLR 1 at 369; [1948] HCA 7. See also Wilcox Mofflin Ltd v New South Wales (1952) 85 CLR 488; [1952] HCA 17. Nettle two parts of the intended operation of the statute rather than of portions of its provisions capable and incapable of valid enactment. The latter way of stating the matter suggests that the problem is one of separating clauses or expressions. But more often than not, when a statute or statutory instrument goes beyond the Constitution the question for the Court is whether a provision too widely or generally expressed should be confined in its operation to so much of the subject it is capable of covering as is constitutionally competent to the legislature, or, as it is sometimes said, whether the general words are to be read and applied distributively". (emphasis added) That said, however, there have been occasions on which severability has been considered before validity. In Cam & Sons Pty Ltd v The Chief Secretary of New South Wales182, s 40B(1) of the Fisheries and Oyster Farms Act 1935 (NSW) required persons selling fish for human consumption to bring such fish for sale in the market in the district or in a market established by a trading society under the Co-operation Act 1923 (NSW). Section 1(3) of the Fisheries and Oyster Farms Act contained the following severability clause: "This Act shall be read and construed subject to the Commonwealth of Australia Constitution Act, and so as not to exceed the legislative power of the State, to the intent that where any provision of this Act, or the application thereof to any person or circumstance is held invalid, the remainder of this Act, and the application of such provision to other persons or circumstances shall not be affected." Dixon, Williams, Webb, Fullagar and Kitto JJ held183: "Plainly s 40B(1) cannot validly operate, consistently with s 92 of the Constitution, to prevent the plaintiff from disposing of its fish in the course of inter-State trade; but s 1(3) makes it impossible to hold that s 40B(1) is intended to have such an operation. … The section must therefore be construed … so as to leave untrammelled the freedom of trade and commerce among the States for which s 92 provides. So construed, it is plainly valid." Notably, their Honours expressed that conclusion before rejecting184 the respondents' argument that s 40B(1) was valid in its full operation because it was merely regulatory. 182 (1951) 84 CLR 442. 183 (1951) 84 CLR 442 at 454. 184 (1951) 84 CLR 442 at 455. Nettle In Carter v The Potato Marketing Board185, the Court was called upon to decide whether s 15(3) of the Primary Producers' Organisation and Marketing Act 1926 (Qld) – which imposed a penalty on any person who sold or delivered potatoes to, or bought or received any potatoes from, a person other than the Potato Marketing Board – had valid application to a transaction involving the appellants. This Court (Dixon, McTiernan, Williams, Webb, Fullagar and Kitto JJ) unanimously stated186: "The legislation contains a severability clause, and, unless the transaction to which the charge relates is itself one of inter-State commerce falling within the protection of s 92, the questions raised by the contentions for the appellants will depend upon the application of that clause with respect to sub-s (3). That is to say, it will depend upon the extent to which, having regard to the scope of the protection afforded by s 92, the severability clause validly may give an operation to the material part of sub-s (3) and upon the extent to which, as a matter of interpretation, it does so. … That the appeal must depend upon the possibility of giving the provisions a severable or distributive application is apparent almost from a bare perusal of the provisions in question. For, consistently with the decided cases, it would not be easy to deny that if the general language of sub-s (3) were given a literal application it would include transactions of inter-State commerce and interfere with the freedom of trade commerce and intercourse among the States. On the other hand it is just as difficult to deny that if by appropriate words of restriction or exception or by a corresponding implication, the operation of sub-s (3) was confined to the domestic trade of the State and the possibility of interference with the freedom of inter-State commerce was excluded, it would be competent to the State to enact such a law." (emphasis added) It may be, however, that the emphasised sentence of their Honours' judgment meant no more than that it was plain on the decided cases that, if s 15(3) were given its full literal scope, it would offend s 92. That is supported by their Honours' later statement187: "Certainly the language in which sub-s (3) is expressed, interpreted naturally, and without the imposition of any artificial restriction by 185 (1951) 84 CLR 460. 186 (1951) 84 CLR 460 at 477. 187 (1951) 84 CLR 460 at 484. Nettle reference to constitutional limitations, extends to inter-State transactions upon which it cannot validly operate. To that extent it would be invalid." Their Honours had earlier observed188 that "[i]t is seldom, if ever, desirable to decide any question of constitutional validity in abstracto and independently of the facts" and concluded189 that the transaction in respect of which the appellants had been charged did not fall within the protection of s 92. They thus disposed190 of the appeal on the basis that s 15(3) could be given a severable and distributive application. Grannall v Marrickville Margarine Pty Ltd191 provides greater support for the idea of dealing with severability before validity. At issue in that case was whether s 22A(1)(b) of the Dairy Industry Act 1915 (NSW) (which prohibited a person from manufacturing table margarine without a table margarine licence) was a statutory attempt to restrict the freedom of interstate commerce in margarine guaranteed by s 92 of the Constitution. Section 2(2) of the Dairy Industry Act was a standard form severability clause. Section 22C was an overriding provision enabling the Minister to grant a special permit for the manufacture or preparation of table margarine for export from Australia, and sub-s (2)(a) required the special permit to contain such conditions as the Minister thought necessary to ensure that none of the margarine manufactured thereunder was to be sold or distributed within the Commonwealth. Section 22C(3) made it an offence to breach any condition imposed by the special permit. Dixon CJ, McTiernan, Webb and Kitto JJ held that s 22A did not infringe s 92 of the Constitution. But in the course of reasoning to that conclusion, their Honours made192 the following passing observations regarding severability: "One provision of the original Act forbids the exportation of margarine from New South Wales unless it is submitted first for examination, a certificate is obtained that the margarine has been prepared in accordance with the Act, and the package is branded as prescribed: s 21. Export from New South Wales necessarily includes delivery into another State and accordingly there may be some doubt as to the validity to that extent of this section. But it is clearly severable; indeed probably it would be read 188 (1951) 84 CLR 460 at 478. See also Chapman v Suttie (1963) 110 CLR 321 at 325, 328-333 per Dixon CJ, dissenting in part; [1963] HCA 9. 189 (1951) 84 CLR 460 at 479. 190 (1951) 84 CLR 460 at 484, 489. 191 (1955) 93 CLR 55. 192 (1955) 93 CLR 55 at 73. Nettle distributively as a result of the severability clause, if it were considered constitutionally incapable of applying to inter-State trade. The section can have no bearing upon the validity of s 22A(1)(b)." (emphasis added) to be inappropriate The statement that s 21 was "clearly severable" conveys that it was considered not to assess severability before, and independently of, the determination of validity. It may appear equivocal, inasmuch as their Honours then went on to observe that "probably it would be read distributively … if it were considered constitutionally incapable of applying to inter-State trade" (emphasis added). But their Honours then dealt193 specifically with s 22C on the basis of severability before reaching a concluded view about its validity: "When, therefore, sub-s (3) of s 22C makes contravention of a condition an offence it purports to penalize, among other things, the sale from New South Wales into another State of a commodity which it assumes has been brought into existence. To this extent at all events s 22C may well be considered to infringe upon the freedom of inter-State trade established by s 92. … It is not difficult to suppose that under the doctrines affecting the severance of invalid from valid statutory provisions which it has been the object of 'severability clauses' to exclude and to reverse, the invalidity of part of the operation of the provisions in question … might have been regarded as infecting the whole of s 22C and a question might have existed as to the presumed dependence thereon of s 22A itself. But clauses of the description of s 2(2) were designed to prevent such a result … Even if it were considered that the whole of sub-s (2)(a) of s 22C fell because it could not extend to inter-State transactions and it were further considered that sub-s (1) could not survive the separation of sub-s (2)(a), no ground exists for discovering in the statute an affirmative intention that s 22A should have no operation unless s 22C proved valid and operative." Fullagar J, writing separately, reasoned to similar effect. His Honour held194 that it was not necessary to form any opinion as to the validity of s 22C as s 2(2) made it plain that the validity and operation of s 22A could not be affected by any vice which could be discovered in s 22C. Nominal Defendant v Dunstan195 less compelling. It turned on the operation of certain provisions of the Motor Vehicles (Third Party Insurance) Act 1942 (NSW). Section 92 was not a central is also pertinent although 193 (1955) 93 CLR 55 at 75-76. 194 (1955) 93 CLR 55 at 82. 195 (1963) 109 CLR 143. Nettle issue. The Court (Dixon CJ, Taylor and Owen JJ) observed196 in passing that, to the extent that s 7(1) of the Act might be considered to offend s 92 in its application to motor vehicles exclusively engaged in interstate trade, it could be read by virtue of s 3 of the Act to apply to all motor vehicles other than those exclusively engaged in interstate trade, commerce or intercourse. By comparison, some of the clearest support in the s 92 cases for deciding this matter on the basis of the threshold question is in the observations of Barwick CJ, in dissent, in Harper v Victoria197. In that case, the plaintiff challenged provisions of the Marketing of Primary Products Act 1958 (Vic) as a substantial impediment to his interstate trade in the importation and retail sale of eggs from outside of Victoria. The majority (McTiernan, Taylor, Menzies and Owen JJ) held that the impugned provisions did not infringe the freedom of interstate trade and commerce, and thus in effect that there was no need to consider any question of severability. Barwick CJ held that it was appropriate to decide the matter on the basis of severability without the determination of validity. His Honour reasoned thus198: "Where such a provision as s 3 of the Acts Interpretation Act [1958 (Vic)] is available [now s 6 of the Interpretation of Legislation Act], and the statute can be given a distributive operation, its commands or prohibitions will then be held inapplicable to the person whose inter-State trade would thus be impeded or burdened. Of course, the question of validity or applicability will only be dealt with at the instance of a person with a sufficient interest in the matter; and, in my opinion, in general, need only be dealt with to the extent necessary to dispose of the matter as far as the law affects that person. I have confined my attention to the situation of the plaintiff and the particular interest which he has in the question of the invalidity or in that of the applicability of the Act. In consequence, I have no need in this case to consider the question whether the prohibition on sale by retail in s 41D has a direct as distinct from a consequential or remote operation upon the inter-State trade of an importer of eggs into Victoria who sells his eggs by wholesale. That question, which I do not regard as directly arising in this case, remains unresolved as far as I am concerned." 196 (1963) 109 CLR 143 at 151-152. 197 (1966) 114 CLR 361. 198 (1966) 114 CLR 361 at 371-373. Nettle Similarly, in Buck v Bavone199 Stephen J (with whom Mason J200 and Jacobs J201 agreed) disposed202 of a s 92 attack on s 12 of the Potato Marketing Act 1948 (SA) by holding that, assuming without deciding that s 12 were a restriction on the freedom of interstate trade and commerce, it could be read down or severed. Stephen J considered203 that there was much to be said for the view that "s 92 should be applied only for the protection of transactions actually existing which come within it and not to imaginary cases"204, and stated205: "A law should not, in my view, be declared invalid when no interested party's interstate trade is shown to have been burdened by it and when there may never exist any trade so circumstanced as to be liable to be so burdened." Taken as a whole, these cases support the idea that there are matters in which it is sufficient to dispose of an attack on the constitutional validity of a provision to conclude that, assuming without deciding that the impugned law would otherwise be invalid, it could be read down or severed in its operation in relation to the plaintiff and so be considered as valid to that extent. There is also this Court's statement in Lambert v Weichelt206 that "[i]t is not the practice of the Court to investigate and decide constitutional questions unless there exists a state of facts which makes it necessary to decide such a question in order to do justice in the given case and to determine the rights of the parties". As the Attorney-General of the Commonwealth submitted, these considerations led this Court to adopt the approach in Knight207 that, assuming without deciding that the provision there in suit would have otherwise offended the Kable208 doctrine – 199 (1976) 135 CLR 110. 200 (1976) 135 CLR 110 at 131. 201 (1976) 135 CLR 110 at 132. 202 (1976) 135 CLR 110 at 127, 130. 203 (1976) 135 CLR 110 at 125-126. 204 Wilcox Mofflin (1952) 85 CLR 488 at 520 per Dixon, McTiernan and Fullagar JJ. 205 (1976) 135 CLR 110 at 126. 206 (1954) 28 ALJ 282 at 283. 207 (2017) 261 CLR 306. 208 Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51; [1996] HCA Nettle because it provided for the possibility of a judicial officer being appointed to a parole board that was statutorily bound to make a parole decision in a designated fashion – the provision could be read down to exclude judges from the board. Despite the occasional utility of that sort of approach, however, the suggestion that the Clubb appeal should be resolved on that basis has little to commend it. As the matter stands, Mrs Clubb has been convicted of a criminal offence of contravening s 185D of the PHW Act by engaging in conduct of the kind described in para (b) of the definition of prohibited behaviour in s 185B(1). She was so convicted consequent upon the Magistrate's rejection of Mrs Clubb's contention that, insofar as s 185D proscribes conduct of the kind referred to in para (b) of the definition of prohibited behaviour, s 185D is invalid as an unjustified burden on implied freedom of political communication. Following conviction, Mrs Clubb appealed against conviction to the Supreme Court of Victoria on grounds including that the Magistrate had erred in holding that, insofar as s 185D proscribes conduct of the kind referred to in para (b) of the definition of prohibited behaviour, it is not an unjustified burden on the implied freedom of political communication. The determination of that ground of appeal was thereafter removed into this Court pursuant to s 40 of the Judiciary Act 1903 (Cth) as a cause or part of a cause involving the interpretation of the Constitution. the Contrary, therefore, to the submissions of the Attorney-General of the Commonwealth, the constitutional validity of s 185D insofar as it proscribes conduct of the kind referred to in para (b) of the definition of prohibited behaviour is not an academic or hypothetical question. If it were held that the proscription of that kind of conduct is an unjustified burden on political communication, and so an infringement of the implied freedom of political communication, it would follow that Mrs Clubb was wrongly convicted and that her conviction should be quashed. Alternatively, if it were held that the proscription in s 185D of that kind of conduct is not an unjustified burden on political communication, and so not an infringement of the implied freedom, then, subject to any other grounds of appeal yet to be considered by the Supreme Court of Victoria, the conviction would be affirmed. Either way, Mrs Clubb has a direct and immediate interest in the question of whether, insofar as s 185D proscribes conduct of the kind referred to in para (b) of the definition of prohibited behaviour, it is an unjustified burden on the freedom of political communication and thus an infringement of the implied freedom. There are also a number of constructional problems in resolving the appeal on the basis that, assuming without deciding that the proscription in s 185D of the para (b) conduct were otherwise an infringement of the implied freedom of political communication, s 185D could be read down under s 6(1) of the Interpretation of Legislation Act to the extent necessary to avoid that result. Nettle First, in the ordinary course of events it would not be appropriate to apply s 6(1) unless the Court has reached the view that, upon its natural and ordinary construction having regard to its context and purpose, the provision would amount to an unjustified restraint on the implied freedom of political communication. Otherwise, the exercise could result in the Court giving the provision a more limited reach than Parliament intended without there being any constitutional need to do so. Secondly, it is doubtful that s 6(1) would apply to s 185D in its proscription of the para (b) conduct. Granted, as the Attorney-General of the Commonwealth submitted, provisions such as s 6(1) may permit a distributive construction of provisions that would not be possible under the ordinary rules of statutory construction. But s 6(1) cannot apply in the face of a "contrary intention"209; and a "contrary intention" for the purposes of severance provisions such as s 6(1) is an intention that the legislative enactment "have either a full and complete operation or none at all"210. Here, such an intention can be discerned. Although the concept of governmental or political communication has been stated in simple terms – a communication which could facilitate the making of a free and informed choice as an elector211 – previous decisions of this Court212 209 Interpretation of Legislation Act, s 4(1)(a). 210 Cam & Sons (1951) 84 CLR 442 at 454 per Dixon, Williams, Webb, Fullagar and Kitto JJ. See also R v Poole; Ex parte Henry [No 2] (1939) 61 CLR 634 at 652 per Dixon J; [1939] HCA 19; Knight (2017) 261 CLR 306 at 325 [35]. 211 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 560; [1997] HCA 25. See also Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 234 per McHugh J; [1992] HCA 45; McCloy v New South Wales (2015) 257 CLR 178 at 193-194 [2], 206 [42] per French CJ, Kiefel, Bell and Keane JJ, 228 [118] per Gageler J, 280 [303] per Gordon J; [2015] HCA 34. 212 Theophanous v Herald & Weekly Times Ltd (1994) 182 CLR 104 at 123 per Mason CJ, Toohey and Gaudron JJ; [1994] HCA 46; Cunliffe v The Commonwealth (1994) 182 CLR 272 at 329 per Brennan J; [1994] HCA 44; Lange (1997) 189 CLR 520 at 560; Levy v Victoria (1997) 189 CLR 579 at 594-595 per Brennan CJ, 613 per Toohey and Gummow JJ, 622-626 per [1997] HCA 31; Australian Broadcasting McHugh J, 638 per Kirby J; Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199 at 281-282 [195]-[199] per Kirby J; [2001] HCA 63; Coleman v Power (2004) 220 CLR 1 at 30-31 [27]-[28] per Gleeson CJ, 45-46 [81]-[82] per McHugh J, 78 [197] per Gummow and Hayne JJ, 88-89 [229] per Kirby J; [2004] HCA 39; Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 195-196 [27]-[30] per Gleeson CJ, 219 [94] per McHugh J, 274-275 [273]-[274] per Kirby J, 304-305 [355] per Heydon J; [2004] HCA 41; APLA Ltd v Legal Services Commissioner (Footnote continues on next page) Nettle show that determinations of whether a communication satisfies that description are fraught with difficulty and disagreement. Against that background, it can hardly be supposed that Parliament envisaged a police officer dealing with the immediacy of an abortion protest within 150 m of premises where abortions are provided making an informed decision as to whether the protest is or is not a governmental or political communication. Yet, in effect, that is what would be required if para (b) of the definition of prohibited behaviour were read down as excluding governmental or political communications. The police officer could not or at least should not arrest or charge a culprit without having reasonable grounds to do so213 and that would require the police officer forming a view as to whether there were reasonable grounds to conclude that the communication was not a governmental or political communication. Those concerns are reflected the statement of French CJ International Finance Trust Co Ltd v New South Wales Crime Commission214: "The court should not strain to give a meaning to statutes which is artificial or departs markedly from their ordinary meaning simply in order to preserve their constitutional validity. There are two reasons for this. The first is that if Parliament has used clear words to encroach upon the liberty or rights of the subject or to impose procedural or other constraints upon the courts its choice should be respected even if the consequence is constitutional invalidity. The second reason is that those who are required to apply or administer the law, those who are to be bound by it and those who advise upon it are generally entitled to rely upon the ordinary sense of the words that Parliament has chosen. To the extent that a statutory provision has to be read subject to a counterintuitive judicial gloss, the accessibility of the law to the public and the accountability of Parliament to the electorate are diminished. Moreover, there is a real risk that, (NSW) (2005) 224 CLR 322 at 350-351 [27]-[28] per Gleeson CJ and Heydon J, 360-361 [63]-[67] per McHugh J, 440 [347] per Kirby J, 450-451 [379]-[380] per Hayne J, 477-478 [450] per Callinan J; [2005] HCA 44; Wotton v Queensland (2012) 246 CLR 1 at 15 [26]-[27] per French CJ, Gummow, Hayne, Crennan and Bell JJ, 21-22 [46]-[51] per Heydon J, 31 [79] per Kiefel J; [2012] HCA 2; Unions NSW v New South Wales (2013) 252 CLR 530 at 548-552 [18]-[30] per French CJ, Hayne, Crennan, Kiefel and Bell JJ, 572 [112] per Keane J; [2013] HCA 58. 213 Crimes Act 1958 (Vic), s 458. On the meaning of "reasonable grounds", see George v Rockett (1990) 170 CLR 104; [1990] HCA 26; Prior v Mole (2017) 261 CLR 265 at 270 [4] per Kiefel CJ and Bell J, 277 [24] per Gageler J, 292 [73] per Nettle J, 298 [98]-[100] per Gordon J; [2017] HCA 10. 214 (2009) 240 CLR 319 at 349 [42]; [2009] HCA 49. Nettle notwithstanding a judicial gloss which renders less draconian or saves from invalidity a provision of a statute, the provision will be administered according to its ordinary, apparent and draconian meaning." (footnote omitted) There being doubt as to whether s 185D in its proscription of the para (b) conduct is severable, it would not be appropriate for this Court to proceed on the basis that, because Mrs Clubb has not demonstrated that her conduct was a political communication, it is unnecessary to decide on the constitutional validity of s 185D. There are also pragmatic reasons why this Court should determine whether the proscription in s 185D of para (b) conduct is an unjustified burden on the freedom of political communication. As will be recalled, that issue of law was raised before the Magistrate for determination as a preliminary question. The Crown did not then contend that s 185D could or should be read down as excluding communications on government or political matters; it was content for the matter to be litigated on an all-or-nothing basis. In deciding the issue of law on that basis against Mrs Clubb, the Magistrate held that abortion protests as described in the affidavit evidence (for the purpose of "constitutional fact finding") "could never be described" as political because abortion is "a medical procedure legally accessible by women" (emphasis added). Hence, on the law as determined by the Magistrate, whether Mrs Clubb's conduct amounted to a communication on a government or political matter could not thereafter be treated at the hearing as an issue of (adjudicative) fact, and evidence adduced by Mrs Clubb directed only to that issue would have been inadmissible as irrelevant. Had the Magistrate determined that s 185D on its face impermissibly burdened the implied freedom and so read the provision as limited to communications other than on government or political matters, her Honour would have had occasion then to decide the non-trivial215 question of whether the effect of that limitation was to introduce an element of the offence, which the Crown would be bound to prove in all cases, or merely an exception within s 72 of the Criminal Procedure Act 2009 (Vic), as to which no proof would be necessary unless raised by the evidence216. As the matter proceeded, however, no question as to onus of proof arose, because the preliminary determination shut out proof on that issue. 215 Allied Interstate (Qld) Pty Ltd v Barnes (1968) 118 CLR 581 at 593-594 per Windeyer J; [1968] HCA 76. See and compare Chugg v Pacific Dunlop Ltd (1990) 170 CLR 249 at 258-259 per Dawson, Toohey and Gaudron JJ; [1990] HCA 41. 216 See generally Glanville Williams, Criminal Law: The General Part, 2nd ed (1961) at 909-910 §295; Fisse, Howard's Criminal Law, 5th ed (1990) at 19-22. Nettle As a result of this procedural history, no finding has yet been made as to whether Mrs Clubb's communication is on a government or political matter. Thus, if this Court were now to decide the preliminary question by assuming without deciding that the prohibition is limited to communications other than on government or political matters, the matter would need to be remitted to the Magistrate for rehearing. At that point, it would be open for the first time to Mrs Clubb, and indeed the Crown, to lead evidence bearing upon, and to address submissions to, whether the charged conduct amounted to a governmental or political communication. And at that point it would be necessary for the Magistrate to decide the very point proposed to be assumed (viz, whether the law would offend the Constitution and so requires reading down). that Moreover, if the Magistrate persisted in the view that the prohibition is ex facie constitutional, or alternatively accepted that it should be read down but held the charged conduct was not a governmental or political communication, Mrs Clubb would then be entitled to appeal to the Supreme Court of Victoria on the questions of law so determined217; and, if unsuccessful, to apply for leave to appeal to the Court of Appeal218; and, if such leave were granted but the appeal dismissed, to apply for special leave to appeal to this Court. In those circumstances, there would be a practical injustice and little practical advantage in this Court disposing of the matter on the basis of the threshold question219. It is preferable that this Court decide now whether, upon its proper construction, the proscription in s 185D of conduct of the kind described in para (b) of the definition of prohibited behaviour infringes the implied freedom of political communication. Facts and legislative provisions The facts of the Clubb appeal and the relevant legislative provisions are set out in the judgment of Kiefel CJ, Bell and Keane JJ and need not be rehearsed. But it is necessary to say something more at this stage of the elements of the offence created by s 185D of the PHW Act comprised of engaging in conduct of the kind specified in para (b) of the definition of prohibited behaviour. 217 Criminal Procedure Act 2009 (Vic), s 272(1); Supreme Court (Criminal Procedure) Rules 2017 (Vic), r 3A.02. 218 Supreme Court Act 1986 (Vic), ss 10(1)(a), 14A. 219 See and compare Thomas v Mowbray (2007) 233 CLR 307 at 515-516 [624] per Heydon J; [2007] HCA 33. Nettle The offence is a regulatory statutory offence and, consequently, although s 185D does not specify a mental element, it may be taken that it requires a general intent to do the act charged220. Accordingly, in any prosecution for contravention of s 185D comprised of conduct of the kind specified in para (b) of the definition of prohibited behaviour, it would be incumbent upon the Crown to prove both that the accused did, and that the accused intended to, communicate at a point within a 150 m radius of premises where abortions are provided in relation to abortions in a manner which would be able to be seen or heard by a person accessing, attempting to access or leaving the premises. It would be open to the Crown to establish that general intent by proving that the accused believed that he or she was within a radius of 150 m of premises at which abortions are provided, and that the accused there communicated regarding abortions by means which would be capable of being seen or heard by a person accessing, attempting to access or leaving the premises. It would not be necessary for the Crown to prove that a person accessing, attempting to access or leaving the premises in fact saw or heard the communication. Parliament's use of the words "able to be seen or heard", as opposed to words such as "is seen or heard", and the problems of proof which, as will be seen, Parliament noticed the Crown would face if proof of the offence required calling a person who had heard or seen the communication221, imply a statutory intention that "able to be seen or heard" is an objective conception tantamount to "would be capable of being seen or heard by a person accessing, attempting to access, or leaving premises at which abortions are provided"222. Nor would it be necessary for the Crown to prove that the accused believed that the communication would be capable of being seen or heard by a person accessing, attempting to access or leaving the premises. But the accused would be entitled to raise the possibility that he or she had an honest and reasonable belief that the communication was incapable of being seen or heard by a person accessing, attempting to access or leaving the premises; in which event the Crown would be left with the persuasive if not evidential burden of excluding that possibility beyond reasonable doubt223. 220 He Kaw Teh v The Queen (1985) 157 CLR 523 at 528-529 per Gibbs CJ (Mason J agreeing at 546), 566-567 per Brennan J; [1985] HCA 43. 221 Victoria, Legislative Assembly, Parliamentary Debates (Hansard), 22 October 222 See also Victoria, Legislative Assembly, Parliamentary Debates (Hansard), 22 October 2015 at 3976. 223 He Kaw Teh (1985) 157 CLR 523 at 534-535 per Gibbs CJ, 558-559 per Wilson J, 573 per Brennan J, 592-593 per Dawson J. Nettle By contrast to the requirement for proof of a general intent to commit the act charged, there is no presumption in relation to regulatory statutory offences that intent to cause specified consequences is an element of the offence charged; and, in the case of a contravention of s 185D comprised of prohibited behaviour of the kind described in para (b) of the definition, there is no reason to discern a statutory intention that an accused must intend that a charged communication be reasonably likely to cause distress or anxiety. To the contrary, the objectivity of the expression "reasonably likely to cause"224 and the difficulty which Parliament noticed the Crown would face in proving a specific intent to communicate in the stipulated manner bespeak a conclusion that Parliament intended it to be enough for the Crown to establish that the conduct would be reasonably likely to cause distress or anxiety to a person accessing, attempting to access or leaving the premises whether or not the accused intended it to have that effect225. Once again, however, it would be open to an accused to raise the possibility that he or she had an honest and reasonable belief that the communication would not be reasonably likely to cause distress or anxiety; in which event the Crown would be left with the persuasive if not evidential burden of excluding that possibility beyond reasonable doubt226. Burden on the implied freedom The constitutional requirement of freedom of political communication is a necessary implication arising from ss 7, 24, 64 and 128 and related sections of the Constitution and thus extends only so far as is required to give effect to those sections227. It arises because it is necessary in order to give efficacy to those provisions that the people be free to communicate concerning government and political matters which could affect their choices in federal and State elections and constitutional referenda or that could throw light on the performance of ministers of state or the executive branch of government228. Unlike the United States First Amendment right of free speech, the implied freedom is not a 224 cf the specific intent required by para (d): "intentionally recording by any means, without reasonable excuse". 225 See and compare He Kaw Teh (1985) 157 CLR 523 at 595 per Dawson J. 226 He Kaw Teh (1985) 157 CLR 523 at 534-535 per Gibbs CJ, 558-559 per Wilson J, 573 per Brennan J, 592-593 per Dawson J. 227 Lange (1997) 189 CLR 520 at 567. 228 Lange (1997) 189 CLR 520 at 571; Levy (1997) 189 CLR 579 at 622 per McHugh J; Unions NSW (2013) 252 CLR 530 at 550-551 [25]-[26] per French CJ, Hayne, Crennan, Kiefel and Bell JJ, 582 [152]-[154] per Keane J. Nettle personal right of free speech but a constraint on legislative power229. The question of whether a law imposes a burden on the implied freedom is thus to be determined according to the law's effect on political communication as a whole rather than on an individual or group's preferred mode of communication230. Where a restriction is limited to a preferred mode of communication, it will not infringe the implied freedom unless it significantly compromises the ability of affected persons to engage in political communication and, even then, only if and because it has a significant effect on political communication as a whole. Many of Mrs Clubb's submissions proceeded from an unstated premise that the implied freedom of political communication operates in similar fashion to the First Amendment right of free speech and that, because some United States authority suggests that conduct of the kind in which Mrs Clubb engaged would be protected by the First Amendment, it should be concluded that her conduct was protected by the implied freedom of political communication. As will appear, once Mrs Clubb's arguments are stripped of that misconception, they must be rejected. The content of the freedom to discuss government and political matters is to be ascertained according to what may be for the common convenience and welfare of society from time to time, and hence its ascertainment requires an examination of changing circumstances231. The range of matters which may qualify as government and political matters is broad232 and, in one sense, it is enough to say of a matter that it is political if it is a matter of political controversy233. But bearing in mind the restricted nature of the implied freedom, there is a danger that the idea of it being enough that a matter is one of political controversy can be pressed too far. It does not follow from the fact that a subject matter is a matter of political controversy that all communications regarding that 229 Unions NSW (2013) 252 CLR 530 at 554 [36] per French CJ, Hayne, Crennan, 230 APLA (2005) 224 CLR 322 at 451 [381] per Hayne J; Wotton (2012) 246 CLR 1 at 31 [80] per Kiefel J; Unions NSW (2013) 252 CLR 530 at 553-554 [35]-[36] per French CJ, Hayne, Crennan, Kiefel and Bell JJ, 574 [119] per Keane J; Brown v Tasmania (2017) 261 CLR 328 at 360 [90] per Kiefel CJ, Bell and Keane JJ; [2017] HCA 43. 231 Lange (1997) 189 CLR 520 at 565-566. 232 Theophanous (1994) 182 CLR 104 at 124 per Mason CJ, Toohey and Gaudron JJ; Hogan v Hinch (2011) 243 CLR 506 at 543-544 [49] per French CJ; [2011] HCA 4. 233 Monis v The Queen (2013) 249 CLR 92 at 177 [229] per Hayne J; [2013] HCA 4. Nettle subject matter are political communications234. More specifically, although abortion is a subject matter of political controversy, it does not follow that all communications about abortion are political. It may be accepted that a communication as to whether abortion law should be changed to prohibit abortion or restrict the circumstances in which it is lawful is a political communication: it is apt to facilitate the making of a free and informed choice as an elector. By contrast, a communication between a woman and her doctor as to the possible physiological and psychological sequelae of the woman undergoing an abortion is an apolitical, personal communication. A law is taken to impose an effective burden on the implied freedom of political communication if it at all prohibits political communication unless perhaps the prohibition or limitation is so slight as to have no real effect235. By proscribing prohibited behaviour within a 150 m radius of premises at which abortions are provided, s 185D prevents persons engaging in political communications about abortion within that area. To that extent, s 185D imposes a restriction on the implied freedom of political communication. But inasmuch as s 185D leaves persons free within the law to say and do whatever they wish about abortion at any point more than 150 m from premises at which abortions are provided, it is not apparent that the proscription of prohibited behaviour within that area has any real effect on the implied freedom. Unlike some other cases in which this Court has been concerned with time, manner and place restrictions of political communication236, there is no evidence here that confining political communications about abortion to a distance of not less than 150 m from premises at which abortions are provided imposes an appreciable restriction on the total number of opportunities for, or effectiveness of, political communication about abortion. In particular, there is no evidence here or reason to suppose that the proscription of prohibited behaviour within the 150 m radius of abortion premises deprives protesters of the ability to generate the type of attention necessary or more likely than other forms 234 APLA (2005) 224 CLR 322 at 449-451 [377]-[379] per Hayne J. 235 Monis (2013) 249 CLR 92 at 142 [108] per Hayne J, 212-213 [343] per Crennan, Kiefel and Bell JJ; Unions NSW (2013) 252 CLR 530 at 555 [40] per French CJ, Hayne, Crennan, Kiefel and Bell JJ, 574 [119] per Keane J; Tajjour (2014) 254 CLR 508 at 569-570 [105]-[107] per Crennan, Kiefel and Bell JJ; McCloy (2015) 257 CLR 178 at 230-231 [126] per 236 See, eg, Australian Capital Television (1992) 177 CLR 106; Levy (1997) 189 CLR 579; Brown (2017) 261 CLR 328. Nettle of communication to sway hearts and minds as to the need for abortion law reform237. What the evidence does reveal is that the proscription of prohibited behaviour within the 150 m radius significantly compromises the ability of persons like Mrs Clubb to accost and harangue women and other persons as they attempt to access premises at which abortions are provided, and thereby to deter them from aborting their pregnancies or deter persons who support and treat them from aiding them to do so. Accordingly, it may be inferred that the effect of s 185D is significantly to reduce the ability of persons like Mrs Clubb to influence particular women to forbear from aborting their pregnancies. But as has been observed, a woman's decision whether or not to abort her pregnancy is not a political decision. It is an apolitical, personal decision informed by medical considerations, personal circumstances and personal religious and ethical beliefs, qualitatively different from a political decision as to whether abortion law should be amended238. For the same reason, a communication directed to persuading a woman as to whether or not to abort her pregnancy is not a political communication but a communication concerning an entirely personal matter. It stands in contrast to what Hayne J described in Monis v The Queen as a single governmental or political communication embodying personal attacks on individuals239. Admittedly, the possibility cannot be excluded that deterring a woman from aborting her pregnancy could sooner or later result in her concluding that abortion should be outlawed, and, in that sense, affect her political choices. But in the scheme of things, the chance of a Damascene conversion of those proportions is surely very limited, and, in any event, such effect on the implied freedom of political communication as the proscription of prohibited behaviour might thus engender would be entirely adventitious. As authority in this and other contexts shows, it would not be an effective burden on the implied freedom240. 237 cf Australian Capital Television (1992) 177 CLR 106 at 145-146 per Mason CJ; Levy (1997) 189 CLR 579 at 613-614 per Toohey and Gummow JJ, 623-625 per McHugh J; Brown (2017) 261 CLR 328 at 400 [240], 407-408 [258] per Nettle J. 238 Cattanach v Melchior (2003) 215 CLR 1 at 80 [221] per Hayne J; [2003] HCA 38. 239 (2013) 249 CLR 92 at 177 [229]. 240 Tajjour (2014) 254 CLR 508 at 582 [155]-[156] per Gageler J, 604 [234] per Keane J. See also Betfair Pty Ltd v Racing New South Wales (2012) 249 CLR 217 at 268 [46] per French CJ, Gummow, Hayne, Crennan and Bell JJ; [2012] HCA 12. Nettle Apart from authority, there might be something to be said for the view that s 185D does not impose any effective burden on the implied freedom of political communication. Previous decisions of this Court, however, have established that the test of whether a law imposes an effective burden on the implied freedom is qualitative, not quantitative, and that the existence of a burden is to be assessed by reference to the terms, operation and effect, both legal and practical, of the law in question241. As Hayne J observed242 in Monis: "submissions about 'little' burdens are contrary to and seek to discard the established and unchallenged doctrine of the Court. They do so by seeking to reformulate the accepted boundaries of the freedom, within which the freedom is absolute. Those boundaries are passed only when the impugned law is found to be reasonably appropriate and adapted to serve a legitimate end in a manner compatible with the constitutionally prescribed system of government and freedom of political communication which is its indispensable incident. By these submissions the first respondent and the interveners sought to reset the boundaries to some quantitative measure. By this means the constitutional freedom would be subordinated to small and creeping legislative intrusions until some point where it could be said that there are so few avenues of communication left that the last and incremental burden is no longer to be called a 'little' burden. This is not and cannot be right." the In terms, s 185D coupled with para (b) of the definition of prohibited behaviour proscribes communicating by any means in relation to abortions within a radius of 150 m of premises at which abortions are provided in a manner that is able to be seen or heard by persons accessing, attempting to access or leaving the premises and is reasonably likely to cause distress or anxiety. In operation, given that most forms of political protest about abortion conducted within 150 m of premises at which abortions are provided would likely be seen or heard by persons accessing, attempting to access or leaving the premises, and, as has been observed, would likely cause appreciable distress or anxiety to a significant proportion of them, the practical effect of the provision is all but to prohibit political protest about abortions within the 150 m radius. Qualitatively, it must be accepted that that is significant, even if it is quantitatively insignificant. 241 Monis (2013) 249 CLR 92 at 145-146 [118]-[122], 160-161 [173]-[174] per Hayne J; Unions NSW (2013) 252 CLR 530 at 555 [40] per French CJ, Hayne, Crennan, Kiefel and Bell JJ; Tajjour (2014) 254 CLR 508 at 578 [145] per Gageler J; Brown (2017) 261 CLR 328 at 382-383 [180] per Gageler J, 398-399 [237] per Nettle J, 431 [316] per Gordon J. 242 (2013) 249 CLR 92 at 145 [120]. Nettle Reasonably appropriate and adapted to serve a legitimate purpose The question then is whether the law is justified as reasonably appropriate and adapted to the achievement of a legitimate purpose consistent with the system of representative and responsible government mandated by the Constitution243. That entails the two-step inquiry adumbrated in Lange v Australian Broadcasting Corporation244, as recently restated in Brown v Tasmania245, as to whether the law is for a legitimate purpose consistent with the system of representative and responsible government and, if so, whether the law is appropriate and adapted to the achievement of that purpose. Legitimate purpose As the plurality emphasised246 in Brown, it is important in ascertaining the purpose of an impugned law not to confuse its purpose with its effect. Generally speaking, the identification of the purpose of an impugned law is to be arrived at by ordinary processes of statutory interpretation247 and therefore according to the text of the statute considered in context, informed by the mischief to which it is directed and having regard to relevant extrinsic materials248. If the purpose of the law thus presents as one of preventing particular kinds of conduct, the fact that the law may have the effect of preventing conduct more generally is ordinarily to be regarded as immaterial. As the law now stands in Victoria, abortion is a lawful medical procedure which women are entitled to undergo in accordance with medical advice as they may choose is appropriate for them. As is apparent from the terms of s 185A of 243 Lange (1997) 189 CLR 520 at 561, 567-568. 244 (1997) 189 CLR 520. See McCloy (2015) 257 CLR 178 at 193-194 [2] per French CJ, Kiefel, Bell and Keane JJ. 245 (2017) 261 CLR 328 at 363-364 [104] per Kiefel CJ, Bell and Keane JJ, 375-376 [155]-[156] per Gageler J, 416 [277] per Nettle J, 478 [481] per Gordon J. 246 (2017) 261 CLR 328 at 362-363 [100] per Kiefel CJ, Bell and Keane JJ. 247 Unions NSW (2013) 252 CLR 530 at 557 [50] per French CJ, Hayne, Crennan, 248 CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408 per Brennan CJ, Dawson, Toohey and Gummow JJ; [1997] HCA 2; McCloy (2015) 257 CLR 178 at 232 [132] per Gageler J; Brown (2017) 261 CLR 328 at 392 [209] per Nettle the PHW Act, and is confirmed249 in the extrinsic materials, the purpose of the proscription of prohibited behaviour is to protect the safety and wellbeing of women, support persons, and others such as staff, as they access premises at which abortions are provided. That is a legitimate purpose consistent with the system of representative and responsible government mandated by the Constitution. Just as persons lawfully going about their commercial business are entitled to get on with it unimpeded by the unwelcome, disruptive antics of insistent protesters250, women seeking an abortion and those involved in assisting or supporting them are entitled to do so safely, privately and with dignity, without haranguing or molestation. The protection of the safety, wellbeing, privacy and dignity of the people of Victoria is an essential aspect of the peace, order and good government of the State of Victoria and so a legitimate concern of any elected State government. A legislative purpose of securing its people that entitlement is thus consistent with the system of representative and responsible government mandated by the Constitution. Counsel for Mrs Clubb contended that the protection of dignity as such is not a legitimate purpose consistent with the system of representative and responsible government because all political speech has the potential to or does affect the dignity of at least some others. So to contend misconceives the nature of the implied freedom. It is a freedom to communicate ideas regarding matters of political controversy to persons who are willing to listen. It is not a licence to accost persons with ideas which they do not wish to hear251, still less to harangue vulnerable persons entering or leaving a medical establishment for the intensely personal, private purpose of seeking lawful medical advice and assistance. A law which has the purpose of protecting and vindicating "the legitimate claims of individuals to live peacefully and with dignity", as is the case here, is consistent with the implied freedom252. 249 Victoria, Legislative Assembly, Parliamentary Debates (Hansard), 22 October 250 Brown (2017) 261 CLR 328 at 414-415 [275] per Nettle J. 251 Brown (2017) 261 CLR 328 at 415 [275] per Nettle J. 252 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 77 per Deane and Toohey JJ; [1992] HCA 46; Australian Capital Television (1992) 177 CLR 106 at 169 per Deane and Toohey JJ; Theophanous (1994) 182 CLR 104 at 178-179 per Deane J. See also Levy (1997) 189 CLR 579 at 608-609 per Dawson J. See and compare Monis (2013) 249 CLR 92 at 182-183 [247] per Heydon J. Nettle Appropriate and adapted "Insubstantial burden" The Attorney-General for Victoria argued that where, as here, a law imposes an "insubstantial burden" on the implied freedom of political communication and can be seen as rationally connected to the achievement of a compelling and legitimate purpose, the law should be held to be reasonably appropriate and adapted to the achievement of that purpose, and therefore valid, simply on the basis that it falls within the realm of matters in which it is open to Parliament to make a selection of means for the achievement of a compelling, legitimate purpose without being "second-guessed" by the court's undertaking of any more detailed analysis of the law's appropriateness and adaptedness. There are a number of problems with that submission. First, it is not the law that the size of the burden which a law imposes on the implied freedom is determinative of whether the law imposes an unjustified burden on the implied freedom253. The predominance given to the size of the burden sits uneasily with existing authority. Secondly, the submission is conclusory. It asserts that the purpose of the law is compelling – which presumably means that its purpose should be regarded as more compelling than at least some other purposes – without revealing how or why it should be so regarded. Thirdly, in effect the submission invokes European human rights jurisprudential conceptions of margin of legislative respect or tolerance254. Those ideas have been rejected in relation to the implied freedom255. The question here is whether the means which Parliament has chosen are appropriate and adapted to the achievement of a legitimate purpose consistent with the system of representative and responsible government mandated by the Constitution. The extent of a burden may feature in the assessment of the appropriateness and 253 Monis (2013) 249 CLR 92 at 146-147 [124] per Hayne J. 254 See Australian Capital Television (1992) 177 CLR 106 at 159 per Brennan J; Cunliffe (1994) 182 CLR 272 at 325 per Brennan J. See generally Arai-Takahashi, The Margin of Appreciation Doctrine and the Principle of Proportionality in the Jurisprudence of the ECHR (2002). 255 Unions NSW (2013) 252 CLR 530 at 553 [34] per French CJ, Hayne, Crennan, Kiefel and Bell JJ; McCloy (2015) 257 CLR 178 at 220 [92] per Gageler J; Murphy v Electoral Commissioner (2016) 261 CLR 28 at 124 [304] per Gordon J; [2016] HCA 36. Nettle adaptedness of the means chosen256. But where, as in this case257, a party seeking to impugn the validity of a law presents what she submits are obvious and compelling alternatives, it is not open to determine definitively that the law is appropriate and adapted to the achievement of a legitimate purpose until and unless those alternatives have been excluded and a conclusion reached that, in view of the legitimacy of purpose and degree of burden, the law does not go beyond what could reasonably be required for the achievement of that purpose. Justification "calibrated" to burden imposed The submissions of the Attorney-General of the Commonwealth were similar. He contended that where, as here, an impugned law imposes but a "slight" degree of burden on the implied freedom, the appropriateness and adaptedness of it may be assessed according to the adage that the degree of justification required for a law which infringes the implied freedom is to be "calibrated" according to the degree of burden, and therefore that the requisite degree of justification is "slight". The Attorney-General added that the "calibrating factors" which here support that conclusion are that the impugned law in terms applies equally to both the pro-abortion and anti-abortion sides of the debate and that the impugned law is a time, manner and place restriction as opposed to a restriction directed to particular persons or particular political content; although, as the Attorney-General accepted, the latter consideration is subject to the qualification that a time, manner and place restriction may require a higher degree of justification where the restricted time, manner and place of political communication is shown to be an especially important part of one or the other side's or a person's communicative capacity. Those contentions face similar difficulties to the submissions of the Attorney-General for Victoria. The Commonwealth's proposed approach does not regard the supposed "slightness" of the burden as the predominant factor in assessing the validity of the law, and to that extent it is more consistent with the established and unchallenged doctrine of the Court as to the accepted boundaries of the freedom within which the implied freedom is absolute258. Like the Victorian Attorney-General's submissions, however, the Commonwealth's contentions are conclusory. They offer no guidance as to what absolute or relative degree of burden is to be regarded as so "slight" as to make it appropriate to prefer the suggested process of a "calibration" to a more thorough assessment of appropriateness and adaptedness. Nor do they provide any justification for abstaining from a necessity analysis where, as here, the party seeking to impugn 256 Brown (2017) 261 CLR 328 at 369 [128] per Kiefel CJ, Bell and Keane JJ. 257 See [278] and [284] below. 258 See [261] above. Nettle the validity of the law has presented what she submits are obvious and compelling alternatives. Further, by focussing on calibrating factors, like a non-discriminatory burden affecting both sides of the debate equally, and the impugned law imposing a time, manner and place restriction, they substitute for principles of analysis capable of general application facts which in some contexts may but in others should not lead to the conclusion that an impugned law is appropriate and adapted to the achievement of a legitimate purpose. For example, as the Attorney-General of the Commonwealth acknowledged, a law which, in terms, applies equally to both sides of the debate may, in some circumstances, restrict the capacity of one side of the debate more severely than the other or restrict one point of view more severely than most. Where that is so, it will be of little consequence that the law in terms applies equally to both or all sides of the debate. The question will be whether the discriminatory effect of the impugned law can be justified as reasonably appropriate and adapted to a legitimate purpose. Similarly, it is of limited assistance to ask whether a restriction is limited to a time, manner and place without also inquiring whether it affects an especially significant means of communication, and then, if it does, whether it can be justified according to established criteria. Utility of proportionality testing Consistently with the plurality's adoption259 of three-part proportionality testing in McCloy v New South Wales, and the acceptance260 by a majority in Brown that three-part proportionality testing can be of assistance in the determination of whether a law is appropriate and adapted to serving a legitimate purpose consistent with the system of representative and responsible government established by the Constitution, I adhere to the view, which I expressed261 in Brown, that three-part proportionality testing comprised of the tests of suitability, necessity and adequacy in balance affords an appropriate method of assessing whether a law is reasonably appropriate and adapted to serving a legitimate purpose consistent with the system of representative and responsible government mandated by the Constitution. But with the benefit of reading in draft what the plurality has written in this matter, it is apparent that what I wrote262 in Brown concerning the content of the necessity test requires some modification. As it now appears to me, in cases in which three-part proportionality testing is applied its application should proceed in accordance with the following criteria: 259 (2015) 257 CLR 178 at 194-195 [2]-[3] per French CJ, Kiefel, Bell and Keane JJ. 260 (2017) 261 CLR 328 at 368-370 [123]-[131] per Kiefel CJ, Bell and Keane JJ, 416-417 [278]-[280] per Nettle J. 261 (2017) 261 CLR 328 at 416-417 [278]-[280] per Nettle J. 262 (2017) 261 CLR 328 at 418-419 [282]. Nettle (1) A law is reasonably appropriate and adapted to achieving a legitimate end consistent with the system of representative and responsible government if it is suitable, necessary and adequate in its balance263. (2) A law is suitable if it exhibits a rational connection to the purpose of the law and a law may be seen to have a rational connection to its purpose if the means for which the law provides are capable of realising the law's purpose264. (3) Up to a point, views may reasonably differ as to whether a law which burdens the implied freedom of political communication is necessary for the achievement of a legitimate purpose consistent with the system of representative and responsible government mandated by the Constitution. Within that range, it is for Parliament to decide what is necessary for the achievement of the purpose. It is only when and if Parliament's selection lies beyond the range of what could reasonably be regarded as necessary that the law will be adjudged as unnecessary. One circumstance, among others, in which that may appear to be the case is where a party seeking to impugn the law can point to an obvious and compelling alternative which is equally practicable and available and would result in a significantly lesser burden on the implied freedom. (4) A law is adequate in its balance if it presents as suitable and necessary in the senses described unless its effect upon the implied freedom is grossly disproportionate265 to or goes far beyond266 what can reasonably be conceived of as justified in the pursuit of the law's purpose. 263 McCloy (2015) 257 CLR 178 at 193-195 [2], 217 [79] per French CJ, Kiefel, Bell and Keane JJ; Brown (2017) 261 CLR 328 at 368 [123] per Kiefel CJ, Bell and Keane JJ, 416-417 [278]-[280] per Nettle J. 264 Tajjour (2014) 254 CLR 508 at 563 [82] per Hayne J; McCloy (2015) 257 CLR 178 at 217 [80] per French CJ, Kiefel, Bell and Keane JJ. 265 Davis v The Commonwealth (1988) 166 CLR 79 at 99-100 per Mason CJ, Deane and Gaudron JJ (Wilson and Dawson JJ agreeing at 101); [1988] HCA 63. 266 Nationwide News (1992) 177 CLR 1 at 78 per Deane and Toohey JJ, 101-102 per McHugh J; Cunliffe (1994) 182 CLR 272 at 324 per Brennan J. See and compare Attorney-General (SA) v Adelaide City Corporation (2013) 249 CLR 1 at 39-40 [58]-[59] per French CJ; [2013] HCA 3. Nettle and system of representative In Brown, I confined267 the test of necessity to the determination of whether there are such obvious and compelling alternatives of significantly lesser burden on the implied freedom of political communication as to imply that the impugned law was enacted for an ulterior purpose inconsistent with the constitutionally prescribed responsible government268. I did so because the Court has recognised that what is necessary to achieve a given legislative purpose must be, to a large extent, within the purview of Parliament and, therefore, that the ascertainment of what is reasonably appropriate and adapted to a legitimate purpose is not a prescription to engage in the assessment of the relative merits of competing legislative models269. To engage in such an exercise would risk passing beyond the border of judicial power into the province of the legislature270. I was also concerned that there is a degree of epistemic uncertainty involved in deciding whether an alternative measure would achieve the same objective as an impugned law while imposing a lesser burden on the implied freedom271. I concluded that it was appropriate to confine the necessity test in the manner I did as a means of minimising the risk of the Court exceeding its constitutional competence and of limiting the epistemic uncertainty of assessing the ability of alternatives to achieve the same result as an impugned law with lesser burden on the implied freedom than the impugned law. On reflection, I accept that to frame the test in the terms I did was too stringent. In addition to cases of obvious and compelling alternatives indicative of an ulterior purpose, it is conceivable that there may be cases falling short of ulterior purpose where an obvious and compelling alternative would result in such a lesser degree of burden on the implied freedom as to show that the 267 (2017) 261 CLR 328 at 418-419 [282]. 268 See and compare Cunliffe (1994) 182 CLR 272 at 388 per Gaudron J. See also Australian Communist Party v The Commonwealth (1951) 83 CLR 1 at 253-254 per Fullagar J; [1951] HCA 5; The Commonwealth v Tasmania (1983) 158 CLR 1 at 260-261 per Deane J; [1983] HCA 21; Castlemaine Tooheys Ltd v South Australia (1990) 169 CLR 436 at 472-473 per Mason CJ, Brennan, Deane, Dawson and Toohey JJ; [1990] HCA 1. 269 Maloney v The Queen (2013) 252 CLR 168 at 183-185 [19]-[21] per French CJ; [2013] HCA 28. 270 Murphy (2016) 261 CLR 28 at 53 [39] per French CJ and Bell J. 271 See Murphy (2016) 261 CLR 28 at 110-111 [251]-[254] per Nettle J. See also Bilchitz, "Necessity and Proportionality: Towards A Balanced Approach?", in Lazarus, McCrudden and Bowles (eds), Reasoning Rights: Comparative Judicial Engagement (2014) 41. Nettle impugned law is not necessary in the relevant sense. There are also cases where the circumstances and the state of the evidence, or lack of it, leave the court unpersuaded that the degree of burden which the impugned law imposes on the implied freedom is necessary for the achievement of the legitimate purpose for which the law was enacted. Australian Capital Television Pty Ltd v The Commonwealth272 and, more recently, Unions NSW v New South Wales273 are examples. The test of necessity must allow for cases of those kinds and conceivably for other possibilities, and so needs to be more flexible than I allowed in Brown. Even so, it remains that the test of necessity is not a prescription to engage in the assessment of the relative merits of competing legislative models. Legislation should not be adjudged unnecessary unless it is clear that Parliament's selection lies beyond the range of what could reasonably be regarded as necessary to achieve the legitimate purpose for which the law was enacted or unless the circumstances and state of evidence are such as to afford the court an insufficient basis to conclude whether the degree of burden is necessary. As to adequacy in balance, I remain of the view expressed in Brown274 that the test of adequacy should be one of an outer limit beyond which the extent of the burden on the implied freedom of political communication presents as manifestly excessive by comparison to the demands of legitimate purpose. That necessitates the court making an assessment of the importance of the purpose of the law as against the extent of the burden which it imposes on the implied freedom of political communication275; and in making that assessment it is necessary to keep in mind that it is principally for Parliament to decide whether a legitimate purpose is of sufficient importance to warrant the extent of its impingement on the implied freedom. As has been observed, the law is yet to yield a principled manner of determining the importance of a legitimate purpose276, or how its importance should be weighted relative to burden277. A test of a manifestly excessive burden by comparison to the demands of legitimate 272 (1992) 177 CLR 106 at 145 per Mason CJ, 239-240 per McHugh J. 273 (2019) 93 ALJR 166; 363 ALR 1; [2019] HCA 1. 274 (2017) 261 CLR 328 at 422-423 [290]. 275 McCloy (2015) 257 CLR 178 at 219 [87] per French CJ, Kiefel, Bell and Keane JJ. 276 Brown (2017) 261 CLR 328 at 465-466 [432] per Gordon J. 277 McCloy (2015) 257 CLR 178 at 236-237 [146] per Gageler J; Brown (2017) 261 CLR 328 at 377 [160] per Nettle purpose recognises and makes due allowance for the inherent difficulties of the process. I recognise that the assessment of adequacy in balance has been criticised as the weighing of incommensurables278. But it is to be observed that the need to weigh incommensurables is hardly unprecedented in the law, and the process is not inutile. In one way or another, courts are not infrequently called upon to weigh competing values that could never plausibly be reduced to any single metric of evaluation – for example, in the identification of a common law duty of care279 or in the sentencing of a criminal offender280. And despite the imprecision of those processes, they are the best available means of fulfilling essential functions. Conceptually, the weighing of the importance of the purpose of a law against its impingement upon the implied freedom of political communication is no different. A court may be assisted in its assessment of adequacy in balance by reference to principles of the common law281. Several of those principles are the product of or reflected in competition between freedom of expression and other personal and social interests, including reputation282, privacy283, and the avoidance of psychological injury284. Where the protection of such an interest 278 Brown (2017) 261 CLR 328 at 377 [160] per See also Betfair Pty Ltd v Western Australia (2008) 234 CLR 418 at 479 [110] per Gleeson CJ, Gummow, Kirby, Hayne, Crennan and Kiefel JJ; [2008] HCA 11. 279 Graham Barclay Oysters Pty Ltd v Ryan (2002) 211 CLR 540 at 597-598 [149] per Gummow and Hayne JJ; [2002] HCA 54; New South Wales v Lepore (2003) 212 CLR 511 at 587-588 [219]-[221] per Gummow and Hayne JJ; [2003] HCA 4. 280 Markarian v The Queen (2005) 228 CLR 357 at 386-387 [71]-[73] per McHugh J; [2005] HCA 25; R v Kilic (2016) 259 CLR 256 at 267 [22] per Bell, Gageler, Keane, Nettle and Gordon JJ; [2016] HCA 48. 281 See and compare Australian Communist Party (1951) 83 CLR 1 at 193 per Dixon J; Theophanous (1994) 182 CLR 104 at 141-142 per Brennan J; Dixon, "The Common Law as an Ultimate Constitutional Foundation" (1957) 31 Australian Law Journal 240 at 240-241, 245. 282 Australian Broadcasting Corporation v O'Neill (2006) 227 CLR 57 at 73 [32] per Gleeson CJ and Crennan J, 88 [87] per Gummow and Hayne JJ, 95 [112] per Kirby J; [2006] HCA 46. 283 Lenah Game Meats (2001) 208 CLR 199 at 226 [41] per Gleeson CJ. 284 Monis (2013) 249 CLR 92 at 175 [223] per Hayne J. Nettle has long been seen to justify the recognition of a cause of action or criminal offence notwithstanding an interference with free speech, coherence suggests that legislation protecting related interests to a comparable extent would not generally be struck down as excessive. At the same time, the court should be mindful not to "carry into constitutional discourse an undue romanticism about the common law"285. The recognition that Parliament may legitimately alter the balance struck at common law requires that the test of adequacy in balance be whether the legislative decision-maker's assessment is grossly disproportionate or manifestly excessive. The test coheres the assessment of infringement of express constitutional guarantees286 and thereby provides a degree of precision which should be regarded as acceptable. At the same time, it alleviates the open-endedness of the court's comparison of importance of purpose with burden, and, the difficulty of weighing incommensurables. Most importantly, it leaves Parliament unhindered within the broad range of what is reasonably open to be achieved. to a considerable extent, it mitigates It was suggested in the course of argument that the adequacy in balance test is largely unnecessary or rendered redundant by reason of the necessity test. That is not so. It is correct that the adequacy in balance test is only ever reached where an impugned law has first passed the necessity test, and thus that, generally speaking, whether a law is appropriate and adapted is more likely to turn on the question of its suitability or necessity than on whether it is adequate in its balance287. But that is not to say that adequacy in balance will never be decisive288. Consistently with the approach taken to express constitutional guarantees, it should be accepted that an impugned law that otherwise presents as suitable and necessary for the achievement of a legitimate purpose consistent with the system of representative and responsible government mandated by the Constitution is not to be regarded as inadequate in its balance unless it so burdens the implied freedom of political communication as to present as grossly 285 See Gummow, "The Constitution: Ultimate foundation of Australian law?" (2005) 79 Australian Law Journal 167 at 176. 286 See, eg, Nationwide News (1992) 177 CLR 1 at 78 per Deane and Toohey JJ, 101-102 per McHugh J; Cunliffe (1994) 182 CLR 272 at 324 per Brennan J, 340 per Deane J. See also Davis (1988) 166 CLR 79 at 99-100 per Mason CJ, Deane and Gaudron JJ (Wilson and Dawson JJ agreeing at 101). 287 Brown (2017) 261 CLR 328 at 417 [280] per Nettle J. 288 See, eg, Brown (2017) 261 CLR 328 at 417 [280] per Nettle J. Nettle disproportionate to or as otherwise going far beyond what can reasonably be conceived of as justified in the pursuit of that purpose. Suitability Relevantly, the means which the PHW Act provides to achieve its purpose is the proscription of prohibited behaviour within a radius of 150 m of premises at which abortions are provided. Prohibited behaviour is precisely defined by s 185B(1) by proscription of the kinds of behaviour which, it appears, Parliament considered to constitute a real risk to the safety, wellbeing, privacy and dignity of persons accessing or attempting to access or leaving premises at which abortions are provided289. The proscription of prohibited behaviour of the kind referred to in para (b) of the definition is thus a means which is logically capable of achieving the purpose of s 185A: preventing the kind of molestation and haranguing which Parliament considered to constitute a real risk to the safety, wellbeing, privacy and dignity of persons accessing or attempting to access or leaving premises at which abortions are provided. Notably, there was evidence before the Magistrate that the experience of staff at the East Melbourne Fertility Control Clinic was that the introduction of the proscription of prohibited behaviour has had a positive effect for the wellbeing of patients and staff. It follows that the proscription of conduct of the kind referred to in para (b) of the definition of prohibited behaviour is rationally connected to the achievement of the purpose of securing the health and wellbeing of women accessing premises at which abortions are provided and is thus suitable in the relevant sense. Necessity As has been emphasised, the means chosen by Parliament to achieve a legitimate purpose consistent with the system of representative and responsible government are not to be considered unnecessary just because the court might think that there is another way of achieving the same objective with arguably less impact on the implied freedom of communication. A law may be adjudged unnecessary in the relevant sense if there is an obvious and compelling alternative of significantly lesser burden on the implied freedom that is equally practicable and available. But it is incumbent on a party challenging a law on the basis that it infringes the implied freedom of political communication to identify any obvious and compelling alternatives which that party contends would or might impose a lesser burden on the implied freedom290. In cases involving the determination of whether an impugned law is justified, notions of burden of proof and persuasion are largely misplaced. Where it appears that a law imposes 289 Victoria, Legislative Assembly, Parliamentary Debates (Hansard), 22 October 290 See also Levy (1997) 189 CLR 579 at 626 per McHugh J. Nettle a burden on the implied freedom, the court is bound to hold the law invalid unless persuaded that it is appropriate and adapted to the achievement of a legitimate purpose. But it does not follow from the need for the court to be persuaded that an impugned law is justified that the court must go in search of and be able to exclude as impracticable every possible alternative of conceivably lesser burden on the implied freedom, still less that a party seeking to uphold the impugned law is required to demonstrate that there are no such alternatives291. If an obvious and compelling alternative of significantly lesser burden on the implied freedom is presented, or presents itself, to the court, it is likely to prove determinative. Otherwise, the issue will not arise. Mrs Clubb contended that there were a number of obvious and compelling alternatives. The first was to repeal para (b) of the definition of prohibited behaviour. Her argument was that, since para (a) of the definition of prohibited behaviour encompasses all of the types of conduct which characteristically interfere with the safety, wellbeing, privacy and dignity of persons entering or leaving premises, the only thing that para (b) adds to the proscription is conduct that does no more than cause mere "discomfort". It followed, in Mrs Clubb's submission, that, if Parliament had omitted para (b) from the definition of prohibited behaviour, the provision as so constituted would have been adequate to achieve the stated purposes of s 185A with a substantially lesser burden on the implied freedom of political communication. That submission breaks down at a number of levels. To begin with, as can be seen from the Statement of Compatibility292, Parliament enacted para (b) of the definition of prohibited behaviour conscious that proscriptions like para (a), being framed in terms of offences and misfeasances, cannot be enforced until after the harmful conduct has occurred, and because Parliament was persuaded that experience had shown that there are significant difficulties with their enforcement293. There is no reason to doubt that is so. Secondly, although it is true that para (a) prohibits significant aspects of the conduct in which anti-abortion advocates have historically engaged, para (b) is ex facie designed to reach conduct that may not amount to any of the criminal offences or misfeasances listed in para (a). Examples of such conduct in evidence before the Magistrate included unsolicitedly drawing near to a woman as she accesses or attempts to access premises at which abortions are provided, forcing literature on her which recites lists of "Possible Physical Complications 291 Brown (2017) 261 CLR 328 at 421-422 [288]. 292 Interpretation of Legislation Act, s 35(b)(iii). 293 Victoria, Legislative Assembly, Parliamentary Debates (Hansard), 22 October Nettle of Abortion" and "Possible Psychological Post Abortion Complications", and advocating alternatives to abortion and "help", thereby to dissuade her from entering the premises. In some of the United States First Amendment cases regarding abortion protests, conduct of that kind is described with disarming American euphemism as "sidewalk counseling"294. In the Victorian legislation, and in the Tasmanian legislation which is in issue in the Preston appeal and which derives in part from Canadian precedent295, some examples of such conduct are proscribed as "interfering with or impeding a footpath"296 or "footpath interference"297, though, again, that proscription does not seem apt to cover all instances of conduct that might fall within the scope of para (b). In this matter, some instances of conduct that might fall within para (b) were more graphically elucidated in experiential evidence presented to this Court by the Castan Centre for Human Rights Law, appearing as amicus curiae: "(a) Protesters approaching, following or walking alongside people and clinic premises, distributing pamphlets, approaching distributing plastic models of foetuses. Protesters equating foetuses with babies by imploring patients not to 'kill' their 'baby', and castigating patients as murderers. Protesters displaying large and graphic posters depicting what purported to be foetuses post-abortion, foetuses in buckets, or skulls of foetuses. Protesters distributing visually graphic literature containing medically inaccurate and misleading information warning that abortion results in infertility, failed relationships, mental illness and cancer." (footnotes omitted) 294 See, eg, Madsen v Women's Health Center Inc (1994) 512 US 753 at 758; Schenck v Pro-Choice Network of Western New York (1997) 519 US 357 at 363; McCullen v Coakley (2014) 134 S Ct 2518 at 2527. 295 See and compare Access to Abortion Services Act, RSBC 1996, c 1, s 2(1), which provides, amongst other things, that a person must not engage in "sidewalk interference". 296 PHW Act, s 185B(1), para (c) of the definition of prohibited behaviour. 297 Reproductive Health (Access to Terminations) Act 2013 (Tas), s 9(1), para (c) of the definition of prohibited behaviour. Nettle Thirdly, para (b) of the definition makes no mention of "discomfort". In terms, it proscribes conduct which is "reasonably likely to cause distress or anxiety", no doubt with a view in part to the kind of conduct just recited. It is specious to contend, as in effect Mrs Clubb contended, that "distress or anxiety" in para (b) means nothing more than mere "discomfort". Fourthly, it is apparent from the Statement of Compatibility that Parliament considered that there was good reason to conclude that the kind of conduct covered by para (b) is productive of distress or anxiety298: "Women and their support people have reported that they have found such conduct very distressing and in many cases psychologically harmful. This is compounded by the fact that many women seeking abortion services are highly vulnerable to psychological harm by reason of the circumstances that have contributed to their decision to undergo an abortion. Provisions that only prohibit intimidating, harassing or threatening conduct, or conduct which impedes access to premises are inadequate for a number of reasons". Those concerns are borne out by evidence adduced by the Attorney-General for Victoria before the Magistrate, and which was before this Court, of Dr Susie Allanson, who worked as a sessional clinical psychologist at the East Melbourne Fertility Control Clinic for 26 years and who observed the activities and conduct of protesters and the effect that harassment had had on her and her patients. Mrs Clubb suggested that another obvious but less burdensome alternative to the proscription of para (b) conduct would be to limit the proscription by means of one or more of the following exclusions: an exclusion for conduct apt to cause no more than discomfort; an exclusion for communications which are consented to; a requirement that the communications in fact be seen or heard; a "carve out" for political communications; a materially smaller safe access zone; 298 Victoria, Legislative Assembly, Parliamentary Debates (Hansard), 22 October 2015 at 3973. See also at 3975-3976. Nettle a "carve out" during elections; a mens rea requirement for one or more of the actus reus elements of the offence. Those suggestions are unconvincing. To the extent that "no more than discomfort" may be conceived of as a mental state of lesser seriousness than distress or anxiety, the legislative requirement that conduct be reasonably likely to cause distress or anxiety serves to exclude conduct apt to cause no more than discomfort. The notion of excluding communications which are consensual is unrealistic. In reality, what is the likelihood of persons who are accessing or attempting to access premises at which abortion services are provided consenting to communications in relation to abortions with people like Mrs Clubb? And even that were a realistic possibility, an exclusion of consensual communications would put major problems of proof in the way of a successful prosecution for breach of the proscription. In most cases it would require the Crown to call the person or persons affected by the communication in order to negative the possibility of consent. And as is apparent from the Statement of Compatibility, one of Parliament's concerns in enacting para (b) of the definition of prohibited behaviour was to avoid the necessity of calling persons affected by proscribed communications, because previous experience showed that such persons were generally unwilling to become involved in court proceedings and that involvement in court proceedings was likely to exacerbate the distress or anxiety to which they have already been subjected299. The absence of an exclusion of consensual communications thus presents as a rational choice of means to achieve the purpose of the proscription. The suggestion of imposing a requirement that a communication in fact be seen or heard encounters similar difficulties. It would mean that, in order to mount a successful prosecution, the Crown would have either to call a person or persons affected by the subject communication or else to adduce circumstantial evidence sufficient to establish beyond reasonable doubt that a person accessing the premises saw or heard the conduct. Given the understandable reticence of affected persons to become involved in court proceedings and the likely harmful effects on them of doing so, Parliament's decision to set the standard at the lower level of what is able to be seen or heard presents, again, as a rational choice. It was necessary for the achievement of the purpose of the provision. 299 Victoria, Legislative Assembly, Parliamentary Debates (Hansard), 22 October Nettle The idea of a "carve out" for political communications or during elections can be dismissed. A carve out for political communications would mean that anti-abortion and pro-abortion protagonists would be free to conduct protests anywhere in the 150 m radius area regardless of the distress or anxiety they would be likely to cause women and others accessing or attempting to access the premises. That would significantly frustrate the purpose of the proscription. And since there is no evidence or other reason to conclude that persons cannot engage in political communication about abortion beyond the 150 m radius to the same extent and as effectively as they can within it, a carve out for political communications or during election periods would do very little to alleviate the burden on the implied freedom of political communication. What it would mostly do is allow persons like Mrs Clubb to continue within the 150 m radius to engage in communications designed to deter women from undergoing abortions and to deter persons who support and treat them. That would be to undermine the purpose of the statute without any quantitative lessening of the burden on the implied freedom. The proposed carve outs are not obvious and compelling alternatives. That is also the answer to the suggestion to reduce the 150 m radius. Since there is no evidence or other reason to imagine that persons cannot engage in political communication about abortion outside the 150 m radius as much and as effectively as they can within that radius, there is equally no reason to suppose that reduction of the radius to something less than 150 m would have a significant quantitative effect on the freedom of political communication. By contrast, as appears from the Statement of Compatibility, any reduction in the radius would be likely to compromise the effectiveness of the proscription300: "A safe access zone of 150 metres has been determined to be appropriate because it provides a reasonable area to enable women and their support people to access premises at which abortions are provided without being subjected to such communication. As I have explained, the conduct has included following women and their support persons to and from their private vehicles and public transport. There have also been many instances of staff being followed to local shops and services, and subjected to verbal abuse. Such conduct has often occurred well beyond 150 metres. However, I consider that 150 metres is a reasonable area that is necessary to enable women and their support persons to access premises, safely and in a manner that respects their privacy and dignity. While such conduct has occurred beyond 150 metres of some abortion services, having a clear safe access zone of 150 metres will enable abortion services to advise women of how they can best access the premises without the risk of such 300 Victoria, Legislative Assembly, Parliamentary Debates (Hansard), 22 October 2015 at 3973-3974. See also at 3976. Nettle conduct, such as where they can park their vehicles or use public transport." No reason has been advanced to doubt the accuracy of those observations. That leaves for consideration the idea of including added mens rea requirements. Reference has already been made to the mental element of an offence contrary to s 185D comprised of conduct of the kind specified in para (b) of the definition of prohibited behaviour in s 185B(1), and to the reasons which informed Parliament's decision to make it an offence of general intent. Seen against that background, it is apparent that making specific intent an essential element of an offence would not be an obvious and compelling alternative. It would substantially emasculate the provision as a deterrent against persons engaging in that kind of prohibited behaviour within 150 m of premises at which abortions are provided. And it would also do very little to reduce the burden on the implied freedom of political communication. As has been explained, although the burden is qualitatively significant, it is quantitatively imperceptible. And logically, what is already so low as to be imperceptible cannot perceptibly be reduced by further reduction. All it would do is increase the incidence of apolitical, personal communications of the kind now prohibited by para (b) within the 150 m radius. In the result, none of Mrs Clubb's suggestions is an obvious and compelling alternative. Adequacy in balance For the reasons earlier stated301, an impugned law that otherwise presents as suitable and necessary for the achievement of a legitimate purpose consistent with the system of representative and responsible government mandated by the Constitution should not be regarded as inadequate in its balance unless it so burdens the implied freedom of political communication as to present as grossly disproportionate to or as otherwise going far beyond what can reasonably be conceived of as justified in the pursuit of that legitimate purpose. As has been explained, the proscription of conduct of the kind identified in para (b) of the definition of prohibited behaviour imposes a relatively limited burden on the implied freedom of political communication. It does so for a legitimate purpose of protecting the safety and wellbeing of women, support persons, and others such as staff, as they access premises at which abortions are provided, and that purpose is consistent with the system of representative and responsible government mandated by the Constitution. The effect of the proscription on the implied freedom, although qualitatively not insignificant, is 301 See [270]-[275] above. Nettle quantitatively minimal. The proscription is not grossly disproportionate to and does not go far beyond what is necessary for the achievement of the purposes identified in s 185A of the PHW Act. It should be concluded that proscription of conduct of the kind identified in para (b) is adequate in its balance. Conclusion in the Clubb appeal It follows that, although the proscription in s 185D of para (b) conduct has a perceptible, qualitative effect on freedom of political the communication, it is a justified burden and therefore a law enacted for a legitimate purpose consistent with the system of representative and responsible government mandated by the Constitution which is appropriate and adapted to the achievement of that purpose. implied The Preston appeal The Preston appeal involves different considerations but the result is the same. Section 9 of the Reproductive Health (Access to Terminations) Act 2013 (Tas) ("the RHAT Act") creates an access zone within a radius of 150 m from premises at which terminations are provided and, within the access zone, proscribes "prohibited behaviour" of five kinds defined in s 9(1) of the RHAT Act as follows: in relation intimidating, to a person, besetting, harassing, interfering with, threatening, hindering, obstructing or impeding that person; or a protest in relation to terminations that is able to be seen or heard by a person accessing, or attempting to access, premises at which terminations are provided; or footpath interference in relation to terminations; or intentionally recording, by any means, a person accessing or attempting to access premises at which terminations are provided without that person's consent; or any other prescribed behaviour." The principal argument of the appellant, Mr Preston, in support of the contention that s 9 of the RHAT Act is invalid as an unjustified burden on the implied freedom of political communication centres on the proscription in that provision of conduct of the kind specified in para (b) of the definition of prohibited behaviour. Mr Preston contended that "protest" in that context has what he submitted is its ordinary meaning of expressing a message in opposition Nettle to something302 – in this case to terminations – and that, because expressing opposition to a topic about which there is political debate (as there is about terminations) is a characteristic mode of political communication, it is clear that the proscription imposes a significant burden on the implied freedom of political communication. In Mr Preston's submission, it is also a particularly obnoxious and illegitimate burden on the implied freedom because it is in terms directed solely to protests which express an opinion in opposition to abortion; applies to protests whether or not they are consented to; applies to a protest even if the protester has a proprietary right to be on the premises where the protest is conducted; and is not limited to protests that cause or would be likely to cause anxiety or distress. Facts and legislative provisions As with the Clubb appeal, the facts and relevant legislation for the Preston appeal are set out in the judgment of Kiefel CJ, Bell and Keane JJ and need not be repeated. But it is necessary to say something more of the meaning of "protest". Mr Preston submitted that "protest" would be apt to cover a private conversation between two individuals if one of those individuals were expressing a view in opposition to terminations. He also submitted that because protest in its ordinary meaning connotes objection or disapproval, "protest in relation to terminations" refers only to expressing a message in opposition to terminations. Up to a point the first of those submissions may be accepted. It is apparent from its context, and, as will be seen, from the considerations which informed the enactment of s 9 of the RHAT Act, that "protest" is used in s 9 in the sense of expressing dissent from or support of terminations by means of a public demonstration in a manner able to be seen or heard by a person accessing or attempting to access premises at which terminations are provided. That would include both a public demonstration by one or more protesters and also one or more protesters engaging a person or persons accessing or attempting to access premises at which terminations are provided on the topic of terminations. There is, however, no basis in the text of the provision to limit its operation to expressions of opinion in opposition to terminations. The use of the general phrase "in relation to terminations" (emphasis added) indicates an intention to capture protests both for and against terminations. It is also necessary to say something about the mental element of the subject offence. Like the offence created by s 185D of the PHW Act, the offence 302 Oxford English Dictionary, online, "protest, n", sense 4c, available at <http://www.oed.com/view/Entry/153191>. Nettle created by s 9 of the RHAT Act comprised of prohibited behaviour of the kind specified in para (b) is a regulatory statutory offence which, because it does not specify the mental element of the offence, may be taken to require a general intent to do the act charged303. In that respect, it stands in contrast to the specific intent required in the case of an offence constituted of conduct of the kind described in para (d) of "intentionally" recording a person accessing or attempting to access premises at which terminations are provided without that person's consent. Accordingly, in a prosecution for an offence of contravention of s 9 of the RHAT Act comprised of engaging in prohibited behaviour of the kind specified in para (b), it would be sufficient for the Crown to prove both that the accused did, and that the accused intended to, protest in relation to terminations within a 150 m radius of premises at which terminations are provided in a manner that was able to be seen or heard by a person accessing or attempting to access premises at which terminations are provided. It would be open to the Crown to establish such a general intent by proving that the accused believed that he or she was within a radius of 150 m of premises at which terminations were provided and there protested in relation to terminations in a manner able to be seen or heard by a person accessing or attempting to access the premises. As under s 185D of the PHW Act304, the use of the words "able to be seen or heard" as opposed to "is seen or heard" indicates that it would not be necessary for the Crown to prove that a person accessing or attempting to access the premises in fact saw or heard the protest. It would be enough for the Crown to prove that it was capable of being seen or heard by a person accessing or attempting to access the premises. It would not be necessary for the Crown to prove that the accused believed that the protest would be seen or heard by a person accessing or attempting to access the premises. But in like fashion to the position under the PHW Act, it would be open to the accused to raise the possibility that he or she had an honest and reasonable belief that the protest would not be seen or heard by a person accessing or attempting to access the premises, in which event the Crown would be left with the persuasive if not evidential burden of excluding that possibility beyond reasonable doubt305. 303 He Kaw Teh (1985) 157 CLR 523 at 528-529 per Gibbs CJ (Mason J agreeing at 546), 566-567 per Brennan J. 304 See [245]-[246] above. 305 He Kaw Teh (1985) 157 CLR 523 at 534-535 per Gibbs CJ, 558-559 per Wilson J, 573 per Brennan J, 592-593 per Dawson J. Nettle Burden on the implied freedom Just as with s 185D of the PHW Act, so too here it may be accepted that s 9 of the RHAT Act imposes a qualitatively recognisable burden on the implied freedom of political communication – by proscribing political communication regarding terminations within the access zone. It may also be accepted that, at least in terms, s 9 of the RHAT Act goes further in its restrictive effect on the implied freedom of political communication than s 185D of the PHW Act, because, in contradistinction to para (b) of the definition of prohibited behaviour in s 185B(1) of the PHW Act, para (b) of the definition of prohibited behaviour in s 9(1) of the RHAT Act singles out protests as such and proscribes them within the access zone without an express limitation to communications which are reasonably likely to cause distress or anxiety. In practical reality, however, the two provisions have much the same effect. On the basis of the experiential and research evidence that was considered by Parliament and that is before this Court306, and as a matter of common sense and ordinary experience, the reasonable likelihood is that virtually any form of protest about terminations within the access zone capable of being seen or heard by persons accessing the premises at which termination services are provided would cause distress or anxiety to persons accessing or attempting to access the premises. Similarly, as in the Clubb appeal, although it must be recognised that the proscription of protests in relation to terminations in the access zone may have a qualitative effect on the implied freedom of political communication, there is no evidence or other reason to conclude that the proscription of a protest in relation to terminations in the access zone would have a significant quantitative effect on the free flow of political communication. As under s 185D of the PHW Act, under s 9 of the RHAT Act protesters are entirely free to conduct lawful protests regarding terminations anywhere except in the access zone, and, as in the Clubb appeal, there is nothing here to suggest that persons cannot protest in relation to terminations just as often and just as effectively outside the access zone as they can within it. Certainly, as in the Clubb appeal, the proscription of protests in relation to terminations in the access zone reduces the capacity of protesters to harangue women seeking terminations of their pregnancies. Thus, it must be accepted that the proscription significantly reduces the capacity of persons like Mr Preston to influence women not to go through with a contemplated termination. But, for the reasons earlier given307, a woman's decision whether to terminate her pregnancy is not a political decision and a communication directed to persuading her not to 306 See [306] below. 307 See [249] above. Nettle terminate her pregnancy is not a political communication. It is a communication concerning an apolitical, personal matter. It follows, as was explained in the Clubb appeal, that the proscription of conduct of the kind described in para (b) of the definition of prohibited behaviour does not impose a quantitatively significant burden on the implied freedom of political communication. Legitimate purpose As appears from the Second Reading Speech308, the enactment of the proscription of conduct delineated in para (b) of the definition of prohibited behaviour proceeded from a recognition on the part of the legislature that women are entitled to a full range of safe, legal and accessible reproductive services necessary for improving their health and wellbeing, and, to that end, that women should be enabled to access lawful termination services privately, with dignity and without harassment, stigma or shame. In that respect, it is apparent that the legislature's resolve was informed by the experience in Victoria309 and by research findings that abortion protests outside premises where terminations are provided deprive women seeking terminations of their pregnancies of their privacy and dignity, stigmatise and shame them in a manner likely to be productive of obvious signs of distress, and heighten their already high levels of psychological distress with significant risk of negative impact upon post-abortion psychological adjustment310. Thus, the legislative purpose of proscribing protests in relation to terminations in the access zone as it appears from the text of the proscription read in context presents as the advancement of women's health through the enablement of women's access to lawful termination services, privately, with dignity and without the adverse psychological impact of being subjected to the harangue of abortion protesters. Although views differ as to the moral and ethical propriety of the intentional termination of human pregnancy, it is now a lawful medical procedure in Tasmania311. Accordingly, a purpose of improving the health and wellbeing of women by enabling their access to a lawful termination service, 308 Tasmania, House of Assembly, Parliamentary Debates (Hansard), 16 April 2013 at 309 See, eg, Tasmania, Department of Health and Human Services, Information Paper relating to the Draft Reproductive Health (Access to Terminations) Bill, March 310 Tasmania, House of Assembly, Parliamentary Debates (Hansard), 16 April 2013 at 50, citing Humphries, "Abortion, Stigma & Anxiety", Clinical Masters, University of Melbourne, 2011. 311 See RHAT Act, Pts 2 and 3. Nettle privately, with dignity and without harassment, stigma or shame, is a purpose which is consistent with the system of representative and responsible government mandated by the Constitution312. Mr Preston contended to the contrary. Based on an assemblage of isolated words and phrases gleaned from the Second Reading Speech, Mr Preston submitted in effect that the true purpose of the proscription is to handicap the anti-termination side of the pro-termination side of the debate regards as "unacceptable" – and that a purpose of handicapping one side of a political debate is quite clearly not a legitimate purpose. the debate – by deterring speech which That contention elides the effect of the proscription with its purpose313. Granted, the effect of legislation is sometimes emblematic of its purpose314, and here it may be accepted that the effect of the proscription of protests in relation to terminations in the access zone is to hamper or handicap anti-termination protests to that extent. But that does not mean that the effect of the legislation is the same as its purpose. Legislation restricting the availability of classified information serves to illustrate the point. A restriction of availability of classified information may have an effect on the defence debate. But, upon proper analysis of the terms of the legislation, it may appear that its purpose is to protect national security regardless of its effect on political communication. Here, for the reasons already stated, the proscription of conduct in para (b) of the definition of prohibited behaviour is not limited to anti-termination views. And it is apparent from the way in which para (b) confines the proscription to protests staged in the access zone that are able to be seen or heard by a person accessing or attempting to access the premises at which termination services are provided that the purpose is to protect the health and wellbeing of women seeking termination of their pregnancies by shielding them from the haranguing, shaming and stigmatising of anti-termination protesters in close proximity to the premises. By leaving anti-termination protesters free to protest wherever and by whatever means they choose outside the access zone, the terms of the proscription forcefully deny that the purpose of the proscription is to silence or handicap the anti-termination side of the debate. In his written submissions, Mr Preston embraced the reality that the aim of anti-termination protests in close proximity to premises where termination services are provided is to "shame" women to forbear from terminating their 312 See [258] above. 313 See [257] above. 314 See and compare Leask v The Commonwealth (1996) 187 CLR 579 at 590-591 per Brennan CJ, 602-603 per Dawson J; [1996] HCA 29. Nettle pregnancies and he submitted that "shaming" women to that end is a legitimate aspect of political communication. He referred by way of analogy to the change in Australia's treatment of her indigenous peoples consequent upon the creation of a sense of shame as to the way in which indigenous peoples were treated in the past. Counsel for Mr Preston did not say so in terms but the argument that appears to be implicit in those submissions is that by "shaming" women to the point that they forbear from terminating their pregnancies, there might ultimately emerge such a generalised sense of "shame" regarding the intentional termination of human pregnancy as to lead to a change in the law to prohibit it, and that it cannot be a legitimate purpose consistent with the system of representative and responsible government mandated by the Constitution to prevent that occurring. There are two answers to that. The first is that, although the "shaming" of a woman who has gone to premises to obtain the termination of an unwanted pregnancy might result in her forbearing from terminating the pregnancy, or at least delaying it, there is no evidence that it would have the effect of converting her into a protagonist for the anti-termination cause. The second answer, which in effect repeats something earlier noticed in relation to the Clubb appeal315, is that, even if the proscription of protests in relation to terminations in the access zone did result in a reduction in the number of hearts and minds converted to the anti-termination mission, it would be an adventitious consequence of the proscription, not the result of an improper purpose of limiting or restricting the free flow of political communication. Appropriate and adapted That leaves the question of whether the proscription of conduct of the kind identified in para (b) of the definition of prohibited behaviour is justified as a law that is appropriate and adapted to the achievement of a legitimate purpose consistent with the system of representative and responsible government mandated by the Constitution. Suitability The preceding discussion of the proscription of the conduct described in para (b) demonstrates that it is rationally connected to the purpose of advancing the health and wellbeing of women seeking terminations of their pregnancies and thus is suitable in the relevant sense. Counsel for Mr Preston contended to the contrary that, because the proscription of protests in relation to terminations in the access zone singles out abortion protests as such and thereby targets a category of protest largely comprised of political communications – leaving other forms of protest 315 See [253] above. Nettle untouched – and because, in contrast to para (b) of the definition of prohibited behaviour in s 185B(1) of the PHW Act, the proscription is not expressly limited to protests "reasonably likely to cause distress or anxiety", the proscription is not rationally connected to the purpose of advancing women's health and so is not suitable in the relevant sense. That contention is unpersuasive. The fact that the proscription is restricted to protests about terminations is consistent with and fortifies the conclusion that the proscription is aimed at giving effect to the purpose of sparing women seeking terminations from exposure to what are considered to be the deleterious effects on their health and wellbeing of subjection to haranguing by anti-abortion or pro-abortion protesters near to premises where terminations are provided. Since there is no suggestion that other kinds of protest – such as, for example, industrial protests – would have a similarly deleterious effect upon the health and wellbeing of such women, it makes sense that those other forms of protest are not mentioned. And as already noticed316, the absence of a requirement that protests be reasonably likely to cause distress or anxiety, although a point of textual distinction to the proscription in para (b) of the definition of prohibited behaviour in s 185B(1) of the PHW Act, in effect makes little difference. Necessity Mr Preston contended that the proscription of protests in relation to terminations within the access zone was not necessary in the relevant sense there were obvious and compelling alternatives productive of because significantly lesser burden on the implied freedom of political communication. In his submission, they were: eliminating para (b) of the definition of prohibited behaviour, with the effect that a protest would not be proscribed unless it amounted to besetting, harassing, intimidating, interfering with, threatening, hindering, obstructing or impeding a person within the meaning of para (a) of the definition of prohibited behaviour; incorporating a requirement in para (b) of the definition that a protest be reasonably likely to cause shame to a person accessing or attempting to access the premises at which termination services are provided; (c) making it a defence that a person charged is able to establish that the protest "had no relevant adverse effect"; 316 See [303] above. Nettle (d) making it a defence that a protest is engaged in with the consent of any person able to see or hear the protest; incorporating a "carve out" for political communications; incorporating a "carve out" for communications in or near Parliament (as is incorporated in comparable New South Wales legislation317); incorporating a "carve out" for communication by or with the authority of a candidate during an election or referendum (as is incorporated in comparable New South Wales legislation318); incorporating a "carve out" for protests made with the consent of the landowner. None of those suggestions is an obvious and compelling alternative. As has been seen, Parliament enacted para (b) of the definition of prohibited behaviour in s 9(1) of the RHAT Act to protect the health, wellbeing, privacy and dignity of women accessing premises at which terminations are provided. Paragraphs (a) and (c) of the definition of prohibited behaviour go some way to achieving that objective. But a protest in relation to terminations could be conducted in the access zone in a manner that studiously avoided commission of any of the misfeasances described in paras (a) and (c) of the definition and yet be just as effective in depriving women accessing the premises of their privacy and dignity and stigmatising and shaming them to an extent productive of psychological infirmity. Elimination of para (b) would therefore substantially dilute the effectiveness of the proscription. It would not operate as an alternative of equal efficacy. Incorporating a requirement in para (b) that a protest in relation to terminations be reasonably likely to cause shame to a person accessing or attempting to access premises at which termination services are provided would make little difference. For reasons earlier stated, any protest in relation to terminations conducted in the access zone would likely infringe the privacy319 and dignity320 of women accessing the premises at which termination services are 317 Public Health Act 2010 (NSW), s 98F(1)(b). 318 Public Health Act, s 98F(1)(c). 319 See and compare Lenah Game Meats (2001) 208 CLR 199 at 226 [42] per 320 cf Monis (2013) 249 CLR 92 at 182-183 [247] per Heydon J. Nettle provided and thereby risk engendering the psychological sequelae which the proscription is designed to prevent. Thus, to make reasonable likelihood of causing shame a specific element of the proscription would do little to change the practical effect of the proscription. And given that the proscription leaves protesters free to conduct protests in relation to terminations outside the access zone, and that there is no evidence or other reason to accept that political protest against terminations outside the access zone is any less effective as a tool of political persuasion than protest within, such difference as the proposed change would make to the burden on the implied freedom of political communication would appear to be negligible. Similar considerations negate the suggestion that it would be an obvious and compelling alternative to provide for a defence of "no relevant adverse effect". It also suffers from the added difficulty that "relevant adverse effect" is a concept about which views are very likely to differ. Given the content of the experiential and research evidence already mentioned, it may be inferred that the majority of women accessing premises at which termination services are provided (or who have ever done so) would likely take the view that staging a protest in relation to terminations in the access zone has serious relevant adverse effects on such women and, more generally, relevant adverse systemic effects on the accessibility of legally available termination services. By contrast, it may be assumed that the majority of anti-abortion protesters genuinely believe that such protests are not productive of adverse effects and that the only relevant effect of them is a beneficial effect that they may result in at least one woman forgoing or delaying the termination of an unwanted pregnancy. Given that divide in opinion, a defence of relevant adverse effect would be impracticable. A defence of consent would for all intents and purposes be meaningless. The possibility that women accessing premises at which termination services are provided would consent to the conduct of a protest in relation to terminations within 150 m of the premises is de minimis. The idea of "carve outs" for certain kinds of communications has largely been dealt with321. For the reasons already given in respect of the Clubb appeal, such carve outs would compromise the efficacy of the proscription in achieving its purpose of protecting the health, wellbeing, privacy and dignity of women accessing premises where termination services are provided while having minimal beneficial effect on the implied freedom. Finally, the suggested exception of protests staged on land with the consent of the owner is irrelevant. Whether or not a protest is conducted with the consent of the owner, it will, if it is able to be seen or heard by a person 321 See [288] above. Nettle accessing premises at which termination services are provided, have exactly the same effect on that person. In sum, none of Mr Preston's contentions casts any doubt on the necessity of the proscription of the conduct in para (b) of the definition of prohibited behaviour in s 9(1). Adequacy in balance For the same reasons, none of Mr Preston's contentions provides a reason to accept that the proscription of protests in relation to terminations within the access zone so burdens the implied freedom of political communication as to present as grossly disproportionate to or as otherwise going far beyond what can reasonably be conceived of as justified in the pursuit of the law's legitimate purpose. It has not been demonstrated that the law is not adequate in its balance. Conclusion in the Preston appeal In the result, it should be concluded that the burden imposed on the implied freedom of political communication by the proscription of the conduct described in para (b) of the definition of prohibited behaviour in the access zone is minimal and is a justified burden as a law that is reasonably appropriate and adapted to the achievement of the legitimate purpose of advancing women's health through the enablement of women's access to lawful termination services without subjection to the harangue of abortion protesters. 326 GORDON J. Mrs Clubb and Mr Preston engaged in conduct, in separate States, which was found to contravene a law that prohibited behaviour within an "access zone" – a 150 m radius of premises at which terminations of pregnancies are provided. The laws, although in different terms, were directed at providing a safe passage for persons accessing or seeking to access those premises. Mrs Clubb and Mr Preston contend that the respective provisions under which they were freedom of political impermissibly burdened convicted communication. Each challenge fails. implied the Section 185D of the Public Health and Wellbeing Act 2008 (Vic), read with para (b) of the definition of "prohibited behaviour" in s 185B(1), prohibits communicating by any means, in relation to abortions, in a "safe access zone" extending 150 m from premises at which abortions are provided, in a manner that is able to be seen or heard by a person accessing, attempting to access, or leaving those premises, where the communication is reasonably likely to cause distress or anxiety ("the Communication Prohibition"). The appellant, Mrs Clubb, contends that the Communication Prohibition infringes the implied freedom of political communication. But Mrs Clubb, her counsel said, was not in a position to mount, and did not mount, a positive case that she was engaged in political communication. As this Court said in Knight v Victoria, the settled practice of this Court means that it is "ordinarily inappropriate for the Court to be drawn into a consideration of whether a legislative provision would have an invalid operation in circumstances which have not arisen and which may never arise if the provision, if invalid in that operation, would be severable and otherwise valid"322. In this appeal, it is appropriate to consider severance, in the form of reading down the Communication Prohibition, as a threshold question323, for two reasons. First, the fact that Mrs Clubb does not contend that she was engaged in political communication means that Mrs Clubb has not demonstrated that there is in issue some "right, duty or liability"324 that turns on the validity of the 322 (2017) 261 CLR 306 at 324 [33]; [2017] HCA 29, citing British Medical Association v The Commonwealth (1949) 79 CLR 201 at 258; [1949] HCA 44 and Tajjour v New South Wales (2014) 254 CLR 508 at 585-589 [168]-[176]; [2014] HCA 35. 323 Tajjour (2014) 254 CLR 508 at 589 [176]. 324 Re East; Ex parte Nguyen (1998) 196 CLR 354 at 362 [18]; [1998] HCA 73, quoting In re Judiciary and Navigation Acts (1921) 29 CLR 257 at 265; [1921] HCA 20. See also Tajjour (2014) 254 CLR 508 at 589 [176]. Communication Prohibition in its application to communication on governmental or political matters. Second, as a matter of statutory construction, the Communication Prohibition would be severable if and to the extent that the provision might burden communication on governmental or political matters in a manner which those circumstances, no further analysis is required, or appropriate, in order to dismiss the challenge to the constitutional validity of the Communication Prohibition. implied constitutional freedom. infringes the It is necessary to say something further about each reason in its application to Mrs Clubb. The reasons are connected. Not addressing the Lange questions325 – in circumstances where Mrs Clubb does not contend that her conduct gives rise to some right, duty or liability that turns on the validity of the Communication Prohibition in its application to communication on governmental or political matters – reflects the settled practice of this Court. The precept is well-established: this Court declines to investigate and decide constitutional questions where there is lacking "a state of facts which makes it necessary to decide such a question in order to do justice in the given case and to determine the rights of the parties"326. 325 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 561, 567; [1997] HCA 25, as modified by Coleman v Power (2004) 220 CLR 1 at 50 [93], 51 [95]-[96]; [2004] HCA 39. cf McCloy v New South Wales (2015) 257 CLR 178 at 193-195 [2]; [2015] HCA 34, as modified by Brown v Tasmania (2017) 261 CLR 328 at 363-364 [104]; see also at 398 [236], 413 [271], 416-417 [277]-[278]; [2017] HCA 43. 326 Lambert v Weichelt (1954) 28 ALJ 282 at 283, quoted in Cheng v The Queen (2000) 203 CLR 248 at 270 [58]; [2000] HCA 53, Re Macks; Ex parte Saint (2000) 204 CLR 158 at 230 [202]; [2000] HCA 62, Plaintiff M76/2013 v Minister for Immigration, Multicultural Affairs and Citizenship (2013) 251 CLR 322 at 372 [148]; [2013] HCA 53, Tajjour (2014) 254 CLR 508 at 587 [173], CPCF v Minister for Immigration and Border Protection (2015) 255 CLR 514 at 613 [335]; [2015] HCA 1, Duncan v New South Wales (2015) 255 CLR 388 at 410 [52]; [2015] HCA 13 and Knight (2017) 261 CLR 306 at 324 [32]. See also Attorney-General for NSW v Brewery Employes Union of NSW (1908) 6 CLR 469 at 590; [1908] HCA 94; Universal Film Manufacturing Co (Australasia) Ltd v New South Wales (1927) 40 CLR 333 at 347, 356; [1927] HCA 50; Deputy Federal Commissioner of Taxation (NSW) v W R Moran Pty Ltd (1939) 61 CLR 735 at 773; [1939] HCA 27; British Medical Association (1949) 79 CLR 201 at 257-258; Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 473-474 [250]-[252]; [2001] HCA 51; Re Aird; Ex parte Alpert (2004) 220 CLR 308 at 326-327 [57]; [2004] HCA 44; Chief Executive Officer of Customs v El Hajje (2005) 224 CLR 159 at 170-171 [27]-[28]; [2005] HCA 35; Wurridjal v The Commonwealth (2009) 237 (Footnote continues on next page) But that first reason – that Mrs Clubb does not mount a positive case that she was engaged in political communication – does not complete the necessary inquiry. If a provision is invalid because it infringes the implied freedom and is not severable, then the provision is invalid327 in its entirety. The invalid provision could not be enforced against any person, regardless of the conduct or circumstances which led to the alleged breach of that provision. Put another way, any such invalidity is not dependent on a person contending that they engaged in communication on governmental or political matters. The invalidity arises because the invalid aspects of the provision cannot be severed, including by reading down. That is why it is necessary in the Clubb appeal to start the inquiry by assuming that the impugned provision is constitutionally invalid because it impermissibly burdens the implied freedom. The question then is whether, as a matter of statutory construction, the impugned provision, or part of it, is able to be severed, by excision or reading down, so as to give the provision a partial but constitutionally valid operation. If the provision, or part of it, cannot be severed, then whether the conduct of the person alleged to have breached the provision involves communication on governmental or political matters is irrelevant. A person charged under a provision purportedly invalid in its entirety has standing to challenge that provision. If, however, the provision can be read down, the direct consequence is to remove the need for the Court to consider any hypothetical or speculative application of the impugned provision328. That is judicially prudent329. ICM Agriculture Pty Ltd v [2009] HCA 2; CLR 309 at 437 The Commonwealth (2009) 240 CLR 140 at 199 [141]; [2009] HCA 51; Kuczborski v Queensland (2014) 254 CLR 51 at 129 [273]; [2014] HCA 46. 327 See, eg, Bell Group NV (In liq) v Western Australia (2016) 260 CLR 500 at 528 [74]; [2016] HCA 21. See also Bourke v State Bank of New South Wales (1990) 170 CLR 276 at 291; [1990] HCA 29; APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 357 [52]; [2005] HCA 44. 328 Tajjour (2014) 254 CLR 508 at 587 [172]. 329 See, eg, Tajjour (2014) 254 CLR 508 at 588 [174], citing Washington State Grange v Washington State Republican Party (2008) 552 US 442 at 450 and Stern, "Separability and Separability Clauses in the Supreme Court" (1937) 51 Harvard Law Review 76. See also Re Patterson (2001) 207 CLR 391 at 473 [249]. The availability of severance means that no further analysis is required in order to dismiss a challenge to the constitutional validity of the impugned provision330. Accordingly, on the assumption that the Communication Prohibition is constitutionally invalid because it impermissibly burdens the implied freedom of political communication, is it severable? Adapting and adopting the words of Barwick CJ in Harper v Victoria331: "Where [a severance clause] is available, and the statute can be given a distributive operation, its commands or prohibitions will then be held inapplicable to the person whose [communication] would thus be impeded or burdened. Of course, the question of validity or applicability will only be dealt with at the instance of a person with a sufficient interest in the matter; and, in my opinion, in general, need only be dealt with to the extent necessary to dispose of the matter as far as the law affects that person." Here, there is a severance clause332. Section 6(1) of the Interpretation of Legislation Act 1984 (Vic)333 provides: "Every Act shall be construed as operating to the full extent of, but so as not to exceed, the legislative power of the State of Victoria, to the intent that where a provision of an Act, or the application of any such provision to any person, subject-matter or circumstance, would, but for this section, have been construed as being in excess of that power, it shall nevertheless be a valid provision to the extent to which it is not in excess of that power and the remainder of the Act and the application of that provision to other persons, subject-matters or circumstances shall not be affected." (emphasis added) 330 Tajjour (2014) 254 CLR 508 at 586-587 [172]. 331 (1966) 114 CLR 361 at 371; [1966] HCA 26. 332 As to the operation of severance clauses, see Carter v The Potato Marketing Board (1951) 84 CLR 460 at 484-485; [1951] HCA 60; Strickland v Rocla Concrete Pipes Ltd (1971) 124 CLR 468 at 492-493, 503-506, 515-520; [1971] HCA 40; Re Nolan; Ex parte Young (1991) 172 CLR 460 at 487-488; [1991] HCA 29; Victoria v The Commonwealth (Industrial Relations Act Case) (1996) 187 CLR 416 at 502-503; [1996] HCA 56. And as to severance by reading down to give constitutional validity, see Pidoto v Victoria (1943) 68 CLR 87 at 111; [1943] HCA 37; Bourke (1990) 170 CLR 276 at 291; Clarke v Federal Commissioner of Taxation (2009) 240 CLR 272 at 312 [89]; [2009] HCA 33. 333 cf Acts Interpretation Act 1901 (Cth), s 15A. Section 6(1) extends and applies to every Victorian Act "unless a contrary intention appears" in the Interpretation of Legislation Act or in the Act concerned334; s 6(1) is taken to be part of the Act concerned335. It is a severance clause intended to ensure that Victorian Acts are construed as being within constitutional power336. The effect of s 6(1) is to "reverse the presumption that an Act is to operate as a whole, so that the intention of the Parliament is to be taken prima facie to be that the Act should be divisible and that any parts found to be within constitutional power should be carried into effect independently of those which fail unless it is clear that the invalid provision forms part of an inseparable context"337. Where s 6(1) is not excluded by a contrary statutory intention, it has two interconnected effects – it operates as a rule of construction, not a rule of law338, and the rule of construction is that "the intention of the legislature is to be taken prima facie to be that the enactment should be divisible and that any parts found constitutionally unobjectionable should be carried into effect independently of those which fail"339. The effect of that rule of construction, where there are "general words or expressions which apply both to cases within power and to cases beyond power", is that if Parliament intended that "there should be a partial operation of the law based upon some particular standard criterion or test" and that intention can be discovered from the provision's terms or from the nature of the subject matter, then the provision can be read down so as to give it valid operation of a partial character340. Indeed, where a law "is intended to operate in an area where Parliament's legislative power is subject to a clear limitation, it can be read as subject to that limitation"341 (emphasis added). 334 Interpretation of Legislation Act, s 4(1)(a). 335 See generally Strickland (1971) 124 CLR 468 at 492-493. 336 Victoria, Interpretation of Legislation Bill 1984, Explanatory Notes at 2. 337 Victoria, Interpretation of Legislation Bill 1984, Explanatory Notes at 2. 338 Tajjour (2014) 254 CLR 508 at 586 [170], quoting Pidoto (1943) 68 CLR 87 at 339 Bank of New South Wales v The Commonwealth (1948) 76 CLR 1 at 371; [1948] HCA 7, quoted in Tajjour (2014) 254 CLR 508 at 585 [169]. 340 Pidoto (1943) 68 CLR 87 at 110-111. 341 Industrial Relations Act Case (1996) 187 CLR 416 at 502-503. In this appeal, the question therefore is whether there is a statutory intention contrary to the prima facie position that, by reason of s 6(1) of the Interpretation of Legislation Act, para (b) of the definition of "prohibited behaviour" in s 185B(1) of the Public Health and Wellbeing Act should be divisible and that any parts found to be within constitutional power should be carried into effect. The answer is that there is no contrary statutory intention and, if necessary, para (b) of the definition of "prohibited behaviour" in s 185B(1) could be read down as not extending to communication on governmental or political matters. That last statement needs some further explanation. The phrase "communicating ... in relation to abortions" in para (b) of the definition of "prohibited behaviour" in s 185B(1) is not defined. The absence from s 185D of a defence applicable to communication on governmental or political matters is not a positive indication that the Victorian Parliament intended s 185D to have a full and complete operation or none at all342. And there is no other indication to be found in the Public Health and Wellbeing Act of an intention contrary to the prima facie application of the severance clause in s 6(1) of the Interpretation of Legislation Act. The stated purpose of Pt 9A343 of the Public Health and Wellbeing Act, of which s 185B forms part, as well as the various paragraphs of conduct which comprise "prohibited behaviour" within a safe access zone, are indications that the Communication Prohibition should be divisible and that any parts found to be within constitutional power should be carried into effect. A stated purpose of Pt 9A was and remains to provide for safe access zones around premises at which abortions are provided so as to protect the safety and wellbeing, and respect the privacy and dignity, of both people accessing the services provided at those premises and employees and other persons who need to access those premises in the course of their duties and responsibilities344. The protections provided in Pt 9A to persons accessing premises where abortions are provided are broad. It cannot be the case that the Victorian Parliament intended that if the Communication Prohibition were invalid as a result of its application to communication concerning governmental or political matters, the Communication Prohibition was to be struck out in its entirety, leaving only protections against the remaining categories of "prohibited 342 cf Tajjour (2014) 254 CLR 508 at 589 [177]. 343 And the principles applying to that Part: see Public Health and Wellbeing Act, s 185C. 344 Public Health and Wellbeing Act, s 185A; see also s 185C. behaviour", namely: interference with a footpath, road or vehicle345; recording persons without their consent346; and the much higher threshold of conduct that amounts to "besetting, harassing, intimidating, interfering with, threatening, hindering, obstructing or impeding" a relevant person347. Such a result would stultify or undermine the statutory purpose of Pt 9A: it would leave persons accessing premises at which abortions are provided vulnerable to confronting and personal communications, including those targeted at their personal choice to attend a clinic and undergo an abortion. Put in different terms, the conclusion is not inconsistent with a fundamental feature348 of Pt 9A. It remains necessary to address Mrs Clubb's contention that if the Communication Prohibition could be read down so as to apply only to communication that is not political communication, the appeal should be allowed because the prosecutor did not prove beyond reasonable doubt that Mrs Clubb's communication was not political communication and the Magistrate did not address that issue. That contention should be rejected. When read with a provision which might otherwise have an application in excess of State legislative power – here, s 185D of the Public Health and Wellbeing Act – s 6(1) of the Interpretation of Legislation Act operates in substance to carve out an exemption from the generality of the provision. Were it not concerned with "constitutional facts", the exception would cast the onus of proof on the party seeking to take advantage of it349. Constitutional facts, however, do not lend themselves to ordinary notions of onus and burden of proof350. It is for the Crown to prove the elements of an offence beyond reasonable doubt. Consistent with the construction just advanced, characterisation of a 345 para (c) of the definition of "prohibited behaviour" in s 185B(1) of the Public Health and Wellbeing Act. 346 para (d) of the definition of "prohibited behaviour" in s 185B(1) of the Public Health and Wellbeing Act. 347 para (a) of the definition of "prohibited behaviour" in s 185B(1) of the Public Health and Wellbeing Act. 348 cf Ghaidan v Godin-Mendoza [2004] 2 AC 557 at 572 [33]-[35], 601 [121], 602 349 See Chugg v Pacific Dunlop Ltd (1990) 170 CLR 249 at 258; [1990] HCA 41. 350 See Maloney v The Queen (2013) 252 CLR 168 at 298-300 [349]-[355], especially at [354]-[355]; [2013] HCA 28. communication as political, or non-political, is not an element of the offence. Whether an accused engaged in political communication would be relevant if, and only if, the accused adduced evidence to seek to establish that fact. Only then would it be necessary for the Crown to seek to address that evidence. So much of Mrs Clubb's appeal as has been removed into this Court should be dismissed with costs. The question of validity of the Communication Prohibition can be, and has been, dealt with to the extent necessary to dispose of the matter as far as the law affects Mrs Clubb. Preston The Reproductive Health (Access to Terminations) Act 2013 (Tas) ("the Reproductive Health Act") regulates the termination of pregnancies by medical practitioners and decriminalises the Reproductive Health Act prohibits a person from engaging in "prohibited behaviour" within an access zone, defined as an area within a radius of 150 m from premises at which terminations are provided352. Section 9(2) of terminations351. "Prohibited behaviour"353 is defined to mean: in relation intimidating, to a person, besetting, harassing, interfering with, threatening, hindering, obstructing or impeding that person; or a protest in relation to terminations that is able to be seen or heard by a person accessing, or attempting to access, premises at which terminations are provided; or footpath interference in relation to terminations; or intentionally recording, by any means, a person accessing or attempting to access premises at which terminations are provided without that person's consent; or any other prescribed behaviour." These protective measures were enacted following years of harassment of persons accessing premises at which terminations are provided. Their objective 351 See the long title of the Reproductive Health Act. 352 Definition of "access zone" in s 9(1) of the Reproductive Health Act. 353 Definition of "prohibited behaviour" in s 9(1) of the Reproductive Health Act. is to enable persons seeking these services to have unimpeded access354: without fear, without shame and without hesitation. This appeal is concerned with the "Protest Prohibition" – para (b) of the definition of "prohibited behaviour"355. The appellant, Mr Preston, was charged on three separate occasions with an offence under s 9(2) of the Reproductive Health Act. The three charges were: "being within an access zone and engaging in prohibited behaviour by protesting in relation to terminations, that was able to be seen or heard by a person, accessing or attempting to access premises at which terminations are provided, located at 1A Victoria Street [Hobart]". The first and second charges related to Mr Preston holding placards and handing out leaflets near the entrance to a specialist medical centre ("the Centre"); the second charge included a conversation between Mr Preston and a woman intending to access the Centre; the third charge involved Mr Preston and two others holding placards outside the Centre. It was an agreed fact that Mr Preston was engaged in a protest in relation to terminations. And it was no part of the prosecutor's case before the Magistrate that the protest was not a communication in relation to governmental or political matters. Mr Preston contended that the Protest Prohibition was beyond the legislative power of the State of Tasmania because it impermissibly burdened the implied freedom of political communication contrary to the Constitution. That contention, among others, was rejected by the Magistrate and Mr Preston was convicted. That part of Mr Preston's appeal to the Supreme Court of Tasmania concerning the constitutional validity of the Protest Prohibition was removed into this Court. This part of the reasons will consider the implied freedom and the terms of the Reproductive Health Act, and then turn to consider the three Lange questions356 in their application to the Protest Prohibition: (1) Does the Protest Prohibition effectively burden the freedom of political communication? (2) Is the purpose of the Protest Prohibition legitimate, in the sense that it is consistent with the maintenance of the constitutionally prescribed system of government? (3) Is the Protest Prohibition reasonably appropriate and adapted to 354 Tasmania, House of Assembly, Parliamentary Debates (Hansard), 16 April 2013 at 355 Reproductive Health Act, s 9(2), read with para (b) of the definition of "prohibited behaviour" in s 9(1). 356 See Lange (1997) 189 CLR 520 at 561-562, 567, as modified by Coleman (2004) 220 CLR 1 at 50 [93], 51 [95]-[96]. cf McCloy (2015) 257 CLR 178 at 193-195 [2], as modified by Brown (2017) 261 CLR 328 at 363-364 [104]; see also at 398 advance that purpose in a manner consistent with the maintenance of the constitutionally prescribed system of government? So much of Mr Preston's appeal as has been removed into this Court should be dismissed. The Protest Prohibition effectively burdens the implied freedom of political communication but that burden is not substantial. The Protest Prohibition is a time, place and manner restriction357: it prohibits a person from engaging in a protest in relation to terminations within a 150 m radius of premises where terminations are provided if the protest is able to be seen or heard by a person accessing, or attempting to access, those premises. The Protest Prohibition is directed to a legitimate purpose or end – to create an access zone to enable women, medical practitioners and other people to have unobstructed and safe access to premises where terminations are provided. The means adopted to achieve that purpose or end (the Protest Prohibition) are not incompatible with the maintenance of the constitutionally prescribed system of representative and responsible government. Implied freedom of political communication The implied freedom of communication on matters of government and politics is readily identified and explained as follows358: "[It] is an indispensable incident of the system of representative and responsible government which the Constitution creates and requires359. The freedom is implied because ss 7, 24 and 128 of the Constitution (with Ch II, including ss 62 and 64) create a system of representative and responsible government360. It is an indispensable incident of that system because that system requires that electors be able to exercise a their representatives, and, for them to be able to do so, there must be a free flow of political communication within the federation361. For that choice to be informed choice when choosing free and 357 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 234-235; [1992] HCA 45; Levy v Victoria (1997) 189 CLR 579 at 618; see also at 639; [1997] HCA 31; Brown (2017) 261 CLR 328 at 462 [420], 464 [426]. 358 Brown (2017) 261 CLR 328 at 430 [312]-[313]. 359 ACTV (1992) 177 CLR 106 at 138; Lange (1997) 189 CLR 520 at 559; Aid/Watch Inc v Federal Commissioner of Taxation (2010) 241 CLR 539 at 555-556 [44]; [2010] HCA 42. 360 See Lange (1997) 189 CLR 520 at 557-562. 361 Unions NSW v New South Wales (2013) 252 CLR 530 at 551 [27], 571 [104]; [2013] HCA 58. exercised effectively, the free flow of political communication must be between electors and representatives and 'between all persons, groups and other bodies in the community'362. The implied freedom operates as a constraint on legislative and executive power363. It is a freedom from government action, not a grant of individual rights364. The freedom that the Constitution protects is not absolute365. The limit on legislative and executive power is not absolute366. The implied freedom does not protect all forms of political communication at all times and in all circumstances. And the freedom is not freedom from all regulation or restraint. Because the freedom exists only as an incident of the system of representative and responsible government provided for by limits legislative and executive power only to the extent necessary for the effective operation of that system367." the Constitution, the freedom In short, the freedom does not exist or operate in a vacuum. Yes, it is concerned with electors being able to exercise a free and informed choice when choosing their representatives and, in order for that to occur, there being a free flow of political communication within the federation. But while the freedom acts as a constraint on legislative and executive power when such power affects that free flow of political communication, the restraint is tempered when the conduct sought to be regulated has effects beyond the communication of ideas or information368. Put in different terms, a democracy has many different freedoms, some of which conflict with each other. To take just one example, the 362 ACTV (1992) 177 CLR 106 at 139. See also Unions NSW (2013) 252 CLR 530 at 551-552 [28]-[30]; Tajjour (2014) 254 CLR 508 at 577 [140]-[141]. 363 Lange (1997) 189 CLR 520 at 560; Hogan v Hinch (2011) 243 CLR 506 at 554 [92]; [2011] HCA 4; Unions NSW (2013) 252 CLR 530 at 554 [36]; Tajjour (2014) 254 CLR 508 at 558 [59], 577 [140]. See also Brown (2017) 261 CLR 328 at 359 364 See, eg, Lange (1997) 189 CLR 520 at 561, 567; Unions NSW (2013) 252 CLR 530 at 551 [30], 554 [36]; McCloy (2015) 257 CLR 178 at 202-203 [30], 228-229 365 Lange (1997) 189 CLR 520 at 561. 366 Tajjour (2014) 254 CLR 508 at 558 [59]. 367 Tajjour (2014) 254 CLR 508 at 577 [140]-[141]. 368 Brown (2017) 261 CLR 328 at 461-462 [416]. entitlement to protest, if exercised without restraint, can interfere with other people's privacy and expose them to abuse369. And that is what this appeal has to address: the intersection of the implied freedom of political communication with a person's privacy and protection of that person from abuse. That intersection was legislatively resolved here by the enactment of a provision (s 9(2)370) which regulates the time, place and manner of a particular communication – a protest in relation to terminations, in an area within a radius of 150 m from premises at which terminations are provided, that is able to be seen or heard by a person accessing, or attempting to access, those premises. Reproductive Health Act – legal effect and practical operation It is necessary to construe the Reproductive Health Act371. The Act contains just 17 sections, divided into five Parts. Parts 2 and 3 provide for a woman's right of access to terminations and the decriminalisation of terminations undertaken by a medical practitioner with a woman's consent372. Part 2 of the Reproductive Health Act, headed "Access to Terminations", contains ss 4 to 12. Sections 4 to 7 address terminations by medical practitioners, including a woman's right to access a termination by a medical practitioner. Section 8 decriminalises terminations. Women are not to be regarded as criminals for making decisions about their own bodies in relation to terminations. Section 9 creates access zones that enable women, medical practitioners and other persons to have unobstructed, unharried and safe access to premises where terminations are provided373. Section 9(2), as seen earlier, makes it an 369 Tasmania, House of Assembly, Parliamentary Debates (Hansard), 16 April 2013 at 370 Read with the definitions in s 9(1). 371 See Brown (2017) 261 CLR 328 at 433-434 [326], citing Coleman (2004) 220 CLR 1 at 21 [3], 68 [158] and Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532 at 553 [11]; [2008] HCA 4. 372 Sections 13 and 14 in Pt 3 state that the amendments effected by Pt 3 of the Reproductive Health Act have been incorporated into the Criminal Code Act 1924 (Tas). 373 See generally Tasmania, House of Assembly, Parliamentary Debates (Hansard), 16 April 2013 at 50-51; Tasmania, Legislative Council, Parliamentary Debates (Hansard), 20 November 2013 at 103. offence for a person to engage in "prohibited behaviour" within an access zone374. An "access zone" is defined in s 9(1) to mean "an area within a radius of 150 metres from premises at which terminations are provided". "Prohibited behaviour" is defined in s 9(1) by reference to the five classes of conduct identified earlier. Mr Preston challenged the constitutional validity of para (b) of the definition of "prohibited behaviour"; he did not challenge the constitutional validity of para (a), (c), (d) or (e) of that definition. Each category of conduct is important and the categories are not mutually exclusive. If conduct covered by para (a), (c), (d) or (e) of the definition is committed within a 150 m radius of premises at which terminations are provided, that conduct will give rise to an offence under s 9(2) of the Reproductive Health Act. The Protest Prohibition is in different, and narrower, terms. It prohibits a "protest" where that protest is "in relation to terminations" and "able to be seen or heard by a person accessing, or attempting to access, premises at which terminations are provided". The prohibition is limited to the access zone – within a 150 m radius of premises at which terminations are provided. Not every "protest" in an access zone is prohibited – the protest must be in relation to terminations and be able to be seen or heard by a person accessing or attempting to access premises at which terminations are provided. the existing reality adopted by governmental "Protest" is not defined. In its ordinary meaning, a protest requires an extended effort and a certain degree of conflict – where the aim of the action is to institutions or influence actors belonging to the private sector375. There usually needs to be a "target". The protest may be "political" – it might concern "the policies of political parties and candidates for election"376 or bear on electoral choice377. But then again, it might not. And that is not surprising: the phrase "government or political matters" is imprecise378. For a "protest" to be political, there needs to be a 374 The penalty is a fine not exceeding 75 penalty units or imprisonment for a term not exceeding 12 months, or both. Sections 10 to 12 deal with proceedings for an offence, infringement notices and the regulation-making power. 375 See, eg, Quaranta, Political Protest in Western Europe: Exploring the Role of Context in Political Action (2015) at 24. 376 Lange (1997) 189 CLR 520 at 560. 377 Brown (2017) 261 CLR 328 at 386 [188]. 378 APLA (2005) 224 CLR 322 at 350 [27], 361 [67], citing Coleman (2004) 220 CLR 1 at 30-31 [28]. See also Theophanous v Herald & Weekly Times Ltd (1994) 182 CLR 104 at 123; [1994] HCA 46. As to the kinds of communication intended to be (Footnote continues on next page) nexus379 between that protest (the communication) and "government or political matters". And even if the control of an activity is politically controversial, not every communication about that activity will be political communication380 in the "constitutional sense". that in relation the phrase "protest terminations" is limited to protests which seek to oppose terminations is rejected. The phrase "protest in relation to terminations" does not discriminate based on viewpoint: it extends to protests in favour of terminations as well as protests in opposition to terminations. If the provision were limited to anti-termination protests within the access zone, the requirement that the protest be "able to be seen or heard by a person accessing, or attempting to access, premises at which terminations are provided" would be likely to be superfluous: anti-termination protesters, by the very nature and purpose of their protests, would in most, if not all, cases endeavour to be seen or heard by such persons. What, then, are the elements of the offence? The accused must be engaged in a protest and intend381 to engage in a protest in relation to terminations. Next, the accused must have an intention to engage in a protest in a manner that is able to be seen or heard by a person accessing, or attempting to access, premises at which terminations are provided. Although the Crown must establish that the protest was capable of being seen or heard by persons accessing, or attempting to access, premises at which terminations are provided, the Crown need not prove the protest was in fact seen or heard by such a person. And, finally, the protest must have occurred within a 150 m radius of premises at which terminations are provided. Before leaving s 9, other aspects of the definition of "prohibited behaviour" in s 9(1) when read with the offence created by s 9(2) should be noted. As seen earlier, the other paragraphs of the definition of "prohibited behaviour" in s 9(1) are not challenged by Mr Preston. They constitute separate prohibitions including a prohibition on intentionally recording a person accessing protected by the implied freedom, see Cunliffe v The Commonwealth (1994) 182 CLR 272 at 329; [1994] HCA 44; Lange (1997) 189 CLR 520 at 560; Levy (1997) 189 CLR 579 at 594-595, 608, 622, 625-626. 379 See Hogan (2011) 243 CLR 506 at 554-555 [93], quoting APLA (2005) 224 CLR 322 at 361 [65]. See generally Lange (1997) 189 CLR 520 at 567, 571. 380 APLA (2005) 224 CLR 322 at 403-404 [219]-[220], 451 [380], citing Cunliffe (1994) 182 CLR 272 at 329. 381 Criminal Code (Tas), s 13(1). See also He Kaw Teh v The Queen (1985) 157 CLR 523 at 564-565; [1985] HCA 43. or attempting to access premises at which terminations are provided, without that person's consent382. In addition, s 9(4) creates a separate offence for publishing or distributing a recording of another person accessing or attempting to access premises at which terminations are provided, without that person's consent. Those elements of the legislative scheme are not unimportant because, by their legal effect and practical operation, a protest by a person that might be caught by the Protest Prohibition is unlikely to be seen or heard by any person not within the access zone regardless of the Protest Prohibition: it cannot be disseminated without breaching the Reproductive Health Act. Paragraph (c) of the definition includes an offence of "footpath interference in relation to terminations" within the access zone. "Footpath interference in relation to terminations" is not defined in the Reproductive Health Act. But on the ordinary meaning of the words, the elements of the offence are simply that: the accused must engage in a voluntary and intentional act383; that act must be done in relation to terminations; and, in so acting, the accused must interfere with passing and re-passing on a footpath within an access zone. One can imagine that the prohibition in para (c) might capture conduct that is more subtle than the kind of conduct addressed in para (a) ("besetting, harassing, intimidating, interfering with, threatening, hindering, obstructing or impeding" a person). Existence of the burden The Protest Prohibition does what it says – it prohibits engagement in "a protest in relation to terminations". As explained earlier, "protest" is undefined384; it is not directed at, or targeted to, political communication. But in prohibiting "a protest in relation to terminations", the Protest Prohibition may operate to impose a burden on political communication. The validity of the Protest Prohibition therefore depends on whether that burden on political communication can be justified. The level of justification that is required depends on the nature and extent of the burden that the impugned provision imposes on political communication385. 382 para (d) of the definition of "prohibited behaviour" in s 9(1) of the Reproductive Health Act. 383 He Kaw Teh (1985) 157 CLR 523 at 564-565. 384 cf Brown (2017) 261 CLR 328 at 339-340 [2]-[3]. 385 Brown (2017) 261 CLR 328 at 367 [118], 369 [128], 378-379 [164]-[165], 389-390 In this appeal, that inquiry – the nature and extent of the burden – can be, and should be, undertaken at this stage of the analysis. Nature and extent of the burden The extent of the burden of the Protest Prohibition on political communication is insubstantial. The legal effect and practical operation of the Protest Prohibition have been considered. The terms of the prohibition, and its legal effect and practical operation in its application to political communication, show that it is not discriminatory. The Protest Prohibition is of general application; it is not specifically directed at, or them386, targeted or "communications which are inherently political or a necessary ingredient of political communication"387. And it is not specifically directed at, or targeted to, the – or even a – source of political communication388. communications, or to, political content of the That the Protest Prohibition does not target the content or the source of political communication is important. The Protest Prohibition "affects those whom the law affects"389; it operates in a uniform manner on any person protesting in relation to terminations within a 150 m radius of premises at which terminations are provided. It applies regardless of whether the protest is political or non-political. It applies whether the person is for, or against, terminations. And it applies only where the protest is capable of being seen or heard by a person accessing or attempting to access the facility. A law is not discriminatory, in a constitutional sense390, because its practical effect might be – from time to time and depending upon the actions of a 386 Brown (2017) 261 CLR 328 at 367-368 [120], citing ACTV (1992) 177 CLR 106 at 387 Wotton v Queensland (2012) 246 CLR 1 at 16 [30]; [2012] HCA 2. See also Hogan (2011) 243 CLR 506 at 555-556 [95]; Monis v The Queen (2013) 249 CLR 92 at 130 [64], 212 [342]; [2013] HCA 4; McCloy (2015) 257 CLR 178 at 238-239 [152]. See generally Cunliffe (1994) 182 CLR 272 at 339. 388 See Unions NSW (2013) 252 CLR 530 at 578-579 [137]-[140]; McCloy (2015) 257 CLR 178 at 233 [136]; Brown (2017) 261 CLR 328 at 361-362 [92]-[95]. See also ACTV (1992) 177 CLR 106 at 132, 172, 175, 221, 235, 237. 389 McCloy (2015) 257 CLR 178 at 287 [334]. 390 cf Queensland Electricity Commission v The Commonwealth (1985) 159 CLR 192 at 240; [1985] HCA 56; Cole v Whitfield (1988) 165 CLR 360 at 409-410; [1988] (Footnote continues on next page) person – to restrict a person from expressing a particular point of view on a particular subject matter, which may or may not be political, at a time and place and in a particular manner. Thus, the Protest Prohibition is not discriminatory because it might – from time to time, depending upon the actions of a person – restrict a person from expressing a particular political point of view at a time and place and in a manner where those actions are the very actions that s 9(2), read with para (b) of the definition of "prohibited behaviour" in s 9(1), seeks to address – actions that prevent persons seeking services at premises at which terminations are provided from having unimpeded access: without fear, without shame and without hesitation. Next, the Protest Prohibition is content and viewpoint neutral. It operates in a limited geographic area – within a 150 m radius of premises at which terminations are provided. It does not prevent a protest in relation to terminations that is 151 m from the premises even if that protest is capable of being seen or heard by a person accessing or attempting to access the premises. It does not prevent a protest in relation to terminations within the access zone so long as the protest is not capable of being seen or heard by a person accessing or attempting to access premises at which terminations are provided. It does not prevent a protest in relation to terminations outside the access zone but at a point, or points, which must be passed for a person to enter the access zone and then the premises at which terminations are provided. The alleged importance of on-site protests in Brown v Tasmania391 can be put aside: not only has there not been established, by evidence, any fact that would support a contention that a protest on-site at premises where terminations are provided is the "most effective" form of political communication, but the practical effect of the other prohibitions in the Reproductive Health Act, which are not challenged, would be, in any event, to limit the reach of any such protest within the access zone. The focus of the inquiry about validity is, and remains, the terms, legal effect and practical operation of the impugned provision in its application to political communication generally392. Here, the terms, legal effect and practical operation of the Protest Prohibition "extend[] to include communications of the kind protected by the freedom"393 but the Protest Prohibition is not directed at HCA 18; Castlemaine Tooheys Ltd v South Australia (1990) 169 CLR 436 at 464, 471-474; [1990] HCA 1. 391 (2017) 261 CLR 328 at 400 [240]. 392 cf Betfair Pty Ltd v Racing New South Wales (2012) 249 CLR 217 at 268 [46]; [2012] HCA 12. 393 Tajjour (2014) 254 CLR 508 at 570 [108]. them, and does not discriminate against them on the basis of content or source. The Protest Prohibition applies without distinction between different kinds of protest in relation to terminations. It is, as has been said, a time, place and manner restriction394 causing an insubstantial and indirect burden on political communication. That conclusion is reinforced by the identified target, or purpose, of the Reproductive Health Act and the Protest Prohibition. Purpose of the Protest Prohibition The short title of the Reproductive Health Act, as well as the heading to Pt 2, records that it is an Act concerned with "Access to Terminations". Part 2 ensures that access is provided in two specific, and connected, ways. Sections 4 to 7 address terminations by medical practitioners including a woman's right to access a termination by a medical practitioner. Section 8 decriminalises terminations. Consistent with, and in order to pursue, that stated objective of providing access to terminations, s 9 then creates access zones for premises at which terminations are provided, to facilitate access to that health service rendered lawful by the other provisions and to prohibit certain behaviour in that access zone. The four categories of conduct in paras (a) to (d) of the definition of "prohibited behaviour" in s 9(1) identify or target conduct that would prevent, or deter, a person from seeking services at premises at which terminations are provided. The Protest Prohibition is one category of conduct. The categories are not mutually exclusive. Put in different terms, the Protest Prohibition is one element – albeit an important element – in a legislative scheme introduced in Tasmania in 2013 designed to afford effective access to pregnancy termination services in Tasmania. Thus, the Protest Prohibition is a law directed at providing a safe passage for persons lawfully accessing or attempting to access premises for health services rendered lawful by other provisions in Pts 2 and 3 of the Reproductive Health Act. The purpose of s 9 is unrelated to political communication, although it may incidentally burden395 the implied freedom. That conclusion is reinforced 394 ACTV (1992) 177 CLR 106 at 234-235; Levy (1997) 189 CLR 579 at 618; see also at 639; Brown (2017) 261 CLR 328 at 462 [420], 464 [426]. 395 ACTV (1992) 177 CLR 106 at 143, 169, 234-235. See also Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 76-77; [1992] HCA 46; Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 200 [40]; [2004] HCA 41; Hogan (2011) 243 CLR 506 at 555-556 [95]; McCloy (2015) 257 CLR 178 at 268-269 by the extrinsic materials396 and, further, by reference to the publicly available reports and other materials cited in those extrinsic materials397. "Women are entitled to access termination services in a confidential manner without the threat of harassment"398 particularly because, as the Minister for Health recognised, women experience poorer health outcomes without the provision of "safe, legal and accessible reproductive services"399. Mr Preston's contention that the purpose or object of the Protest Prohibition is to "deter speech" of a certain character is contrary to the text of the Reproductive Health Act and the evident purpose of the Protest Prohibition. The purpose of the Protest Prohibition is not to deter speech but to enable women, medical practitioners and other people to have unobstructed and safe access to premises where terminations are provided. The Protest Prohibition removes one of the barriers that deterred people from accessing lawfully available medical services in relation to terminations. That is a legitimate and permissible purpose; a purpose not the system of representative and responsible government prescribed by the Constitution. incompatible with Appropriate and adapted The Protest Prohibition is an important element of the scheme introduced in 2013 directed at providing effective access to pregnancy termination services in Tasmania. It was and remains "part of a broader strategy [of the Tasmanian Government] to improve the sexual and reproductive health of all Tasmanians, especially ... vulnerable populations"400. 396 See Tasmania, House of Assembly, Parliamentary Debates (Hansard), 16 April 397 See Humphries, "Abortion, Stigma & Anxiety", Clinical Masters, University of Melbourne, 2011; Tasmania, Department of Health and Human Services, Information Paper relating to the Draft Reproductive Health (Access to Terminations) Bill: Revised pregnancy termination laws proposed for Tasmania 398 Tasmania, House of Assembly, Parliamentary Debates (Hansard), 16 April 2013 at 399 Tasmania, House of Assembly, Parliamentary Debates (Hansard), 16 April 2013 at 400 Tasmania, House of Assembly, Parliamentary Debates (Hansard), 16 April 2013 at The intersection of the implied freedom of political communication with a person's privacy and protection from abuse was legislatively resolved in Tasmania by the enactment of a provision (s 9(2)) which regulates the time, place and manner of a particular kind of communication. In reaching that resolution, the Tasmanian Parliament described the "appropriate balance between the right to protest and protecting women from being exposed to those who seek to shame and stigmatise them"401. the access zone as providing "The balancing of the protection of other interests against the freedom to discuss governments and political matters is, under our Constitution, a matter for the Parliament to determine and for the Courts to supervise"402 (emphasis added). The judicial role ensures that the system of representative and responsible government which the Constitution creates and requires is not undermined by laws burdening political communication. Here, the Protest Prohibition has a rational connection to the stated purpose of the Reproductive Health Act – facilitating unobstructed and safe access to pregnancy termination services in Tasmania. It is one of the distinct types of conduct prohibited by s 9(2): categories of conduct identified by the Parliament as deterring people from seeking access to termination services403. The Protest Prohibition, in its legal effect and practical operation, effects an insubstantial and indirect burden on political communication; it regulates the time, place and manner of protest in relation to a particular subject matter (terminations) and of a particular amplitude ("able to be seen or heard ..."); and it does so for an identified and legitimate end, an end which was and remains the principal, if not sole, reason why the provision was enacted – to provide unobstructed and safe access to pregnancy termination services in Tasmania. No other conclusion can be drawn than that the Protest Prohibition is reasonably appropriate and adapted to advance that purpose in a manner compatible with the maintenance of the constitutionally prescribed system of government. 401 Tasmania, House of Assembly, Parliamentary Debates (Hansard), 16 April 2013 at 402 Nationwide News (1992) 177 CLR 1 at 50, quoted in Brown (2017) 261 CLR 328 at 467 [436]. See also Mulholland (2004) 220 CLR 181 at 197 [32]; McCloy (2015) 257 CLR 178 at 229-230 [122]-[123]. 403 Tasmania, House of Assembly, Parliamentary Debates (Hansard), 16 April 2013 at 50, citing Humphries, "Abortion, Stigma & Anxiety", Clinical Masters, University of Melbourne, 2011. Mr Preston's conduct contravened the Protest Prohibition: a law directed at providing an unobstructed and safe passage for persons lawfully accessing or seeking to access premises at which terminations are provided. There is nothing protectable about seeking to shame strangers about private, lawful decisions they make. Structured proportionality In the circumstances of this appeal, like those in Brown404, it is neither necessary nor appropriate to say anything further about suitability, necessity or adequacy of balance. Once it is accepted, as it has been, that the burden is insubstantial and indirect and that the Protest Prohibition is rationally connected to the legitimate purpose it seeks to serve, no further analysis is required. It is these factors which show why the burden is not "undue"405. Structured proportionality testing406 is a means of expressing a chain of reasoning undertaken to arrive at a conclusion about the validity of a provision said to be beyond power because it burdens the implied freedom of political communication. It is a means of setting out steps to a conclusion – a tool of analysis407. It is not a constitutional doctrine408 or a method of construing the Constitution. The contention that, in the Australian context, structured proportionality – even if not deployed in a rigid or sequenced way – may provide a better account of judicial reasoning and thereby promote more consistency and clarity in judgment409 is to be approached with caution. Not every law which effectively burdens the freedom of political communication poses the same degree of risk to the efficacy of the system of representative and responsible government which the Constitution creates and 404 (2017) 261 CLR 328 at 464-468 [427]-[438]. 405 Lange (1997) 189 CLR 520 at 569, 575. 406 See McCloy (2015) 257 CLR 178 at 194-196 [2]-[4], 213-220 [69]-[92]; Brown (2017) 261 CLR 328 at 363-364 [104], 368-370 [123]-[131]. 407 McCloy (2015) 257 CLR 178 at 213 [68], 215-216 [74]; Brown (2017) 261 CLR 408 McCloy (2015) 257 CLR 178 at 213 [68]; Brown (2017) 261 CLR 328 at 476-477 409 See Jackson, "Thayer, Holmes, Brandeis: Conceptions of Judicial Review, Factfinding, and Proportionality" (2017) 130 Harvard Law Review 2348 at 2375. requires410. Not every law which effectively burdens the freedom of political communication, but which is directed to a legitimate end, demands the same degree of justification. Not every law which effectively burdens the freedom of political communication needs to be subjected to the same level of scrutiny. Not every law which effectively burdens the freedom of political communication is able to be, or should be, analysed by a rigid, "one size fits all", approach411. The detailed structure of proportionality does not reflect the common law method of legal reasoning. The application of any tool of analysis requires consideration of the context within which the tool is to operate412; structured proportionality reflects its civil law origins and purposes413. Whether the origins of structured proportionality lie outside Australia is not the relevant question. The relevant question is what is structured proportionality, and is that suited to, and compatible with, the Australian context. Proportionality as a tool of analysis often takes as its starting point the concept of a prima facie infringement of a right and inquires as to whether the goal being achieved warrants the extent of intrusion on that right414. According to Schauer, it is only when rights are in issue that the language of proportionality is in play415. And when rights are "on one side of the equation", there is a presumption in favour of the right or a burden of proof imposed on those who would restrict the right. In that context, Schauer contends that the idea of "balancing" – which would ignore the presumption and burden – is misleading416. 410 Brown (2017) 261 CLR 328 at 378 [164]. 411 Brown (2017) 261 CLR 328 at 477 [476]. See generally Kaplow, "On the Design of Legal Rules: Balancing Versus Structured Decision Procedures" (2019) 132 Harvard Law Review 992. 412 Jackson, "Thayer, Holmes, Brandeis: Conceptions of Judicial Review, Factfinding, and Proportionality" (2017) 130 Harvard Law Review 2348 at 2393. 413 As to its origins, see Currie, The Constitution of the Federal Republic of Germany 414 Jackson, "Thayer, Holmes, Brandeis: Conceptions of Judicial Review, Factfinding, and Proportionality" (2017) 130 Harvard Law Review 2348 at 2361-2364. 415 Schauer, "Proportionality and the Question of Weight", in Huscroft, Miller and Webber (eds), Proportionality and the Rule of Law: Rights, Justification, Reasoning (2014) 173 at 176-177. 416 Schauer, "Proportionality and the Question of Weight", in Huscroft, Miller and Webber (eds), Proportionality and the Rule of Law: Rights, Justification, Reasoning (2014) 173 at 178. Indeed, it has been said that what "lurk[s]" beneath this presumption and burden of proof, and is implicit in any rights-based proportionality analysis, is a "structural" matter – a "rule of weight" – or, really, a rule of disproportionate weight: a rule giving more weight to the right than to competing non-right interests. The structure (and the rule) exists because there is a right. And it is said that it is that structure that explains the difference between proportionality analysis and the balancing methodology that underpins policy decisions417. If the analysis stopped there, the need for a cautious approach to proportionality would be evident: not only is the implied freedom of political communication not a right, but the conceptual origins of structured proportionality find no readily identifiable equivalents in the Australian constitutional structure or jurisprudence. But there are other reasons for caution. Structured proportionality, as a tool of analysis, is contested conceptually, geographically and in its sphere of application and influence418. In some countries, the detailed structure of proportionality has been displaced by a concept of reasonableness419. In other countries that had previously adopted a form of structured proportionality analysis, it now does not reflect the only or even the preferred method of legal reasoning. The United States has not adopted proportionality420 as a form of analysis. 417 Schauer, "Proportionality and the Question of Weight", in Huscroft, Miller and Webber (eds), Proportionality and the Rule of Law: Rights, Justification, Reasoning (2014) 173 at 178, 180-181. 418 See generally Jackson and Tushnet (eds), Proportionality: New Frontiers, New Challenges (2017); Ellis (ed), The Principle of Proportionality in the Laws of Europe (1999). 419 Young, "Proportionality, Reasonableness, and Economic and Social Rights", in Jackson and Tushnet (eds), Proportionality: New Frontiers, New Challenges 420 See Cohen-Eliya and Porat, "American balancing and German proportionality: The historical origins" (2010) 8 International Journal of Constitutional Law 263; Möller, "US Constitutional Law, Proportionality, and the Global Model", in Jackson and Tushnet (eds), Proportionality: New Frontiers, New Challenges And that is not surprising. Competing views of what have been described as the "paradigms of proportionality"421 abound. And they are just some aspects of the current, and ardent, debate about proportionality generally422. For example, Alexy distinguishes between "rules" and "principles" and contends that "[r]ules aside, the legal possibilities are determined essentially by opposing principles"; and that a principle is merely a prima facie requirement where the determination of one principle relative to the requirements of other principles is brought about by balancing with an objective of Pareto optimisation – that something be realised "to the greatest extent possible given the three sub-principles of proportionality express this idea of optimisation – the first and second, suitability and necessity, refer to optimisation relative to the factual possibilities and the third, the law of balancing, concerns optimisation of the legal possibilities424. Alexy sees and uses proportionality as a method of interpretation. legal and factual possibilities"423. Alexy contends that the Barak has a different starting point as well as a fourth element in structured proportionality. Barak's starting point is what he describes as a 421 Jackson and Tushnet, "Introduction", Jackson and Tushnet (eds), Proportionality: New Frontiers, New Challenges (2017) 1 at 2. 422 See, eg, Jackson and Tushnet (eds), Proportionality: New Frontiers, New Challenges (2017); Jackson, "Pockets of proportionality: choice and necessity, doctrine and principle", in Delaney and Dixon (eds), Comparative Judicial Review (2018) 357. See also Grimm, "Proportionality in Canadian and German Constitutional Jurisprudence" (2007) 57 University of Toronto Law Journal 383 at 423 Alexy, "Proportionality and Rationality", in Jackson and Tushnet (eds), Proportionality: New Frontiers, New Challenges (2017) 13 at 14. For a discussion as to the analytical difference between "proportionality as principle" and "proportionality as structured doctrine", see Jackson, "Pockets of proportionality: choice and necessity, doctrine and principle", in Delaney and Dixon (eds), Comparative Judicial Review (2018) 357 at 368-376. In jurisdictions where the latter approach is adopted, the steps in proportionality testing are seen as sequential; Canada is an example: see generally R v Oakes [1986] 1 SCR 103, reformulated in Newfoundland (Treasury Board) v NAPE [2004] 3 SCR 381 at 424 Alexy, "Proportionality and Rationality", in Jackson and Tushnet (eds), Proportionality: New Frontiers, New Challenges (2017) 13 at 14. limitation on the constitutional right as a prima facie violation425. By way of contrast, Alexy's starting point is a principle as a prima facie requirement. Barak then contends that the requirement of a proper purpose defines the first step of the proportionality test426. By way of contrast, Alexy's position is that such a first step is superfluous and may even pose a danger for the rationality of the test427. Although that list of disputes is not exhaustive, it is illustrative of the difficulties of seeking to import structured proportionality as a "one size fits all" approach. Any contention that a legal rule, of itself, creates transparency must identify the need for, or usefulness of, that rule. For example, some of the steps in structured proportionality analysis are unnecessary; it is hard to imagine how a law would fail the first stage and not also the second428, and the third stage to some degree overlaps with the prior analysis of whether the law's purpose is legitimate429. And, in that context, whilst structured decision-making is sometimes advocated as a replacement for an unconstrained balancing test, if used it is necessary to ascertain whether outcomes differ as between the two methods, and if so, why, and which is the preferred legal outcome430. A court, in seeking to exercise judgment about laws enacted by members of Parliament – who exercise legislative power as "representatives of the people" 425 See Barak, Proportionality: Constitutional Rights and their Limitations (2012) at 426 See Alexy, "Proportionality and Rationality", in Jackson and Tushnet (eds), Proportionality: New Frontiers, New Challenges (2017) 13 at 19-20, citing Barak, Proportionality: Constitutional Rights and their Limitations (2012) at 530; see also at 245-302, 529-539. 427 Alexy, "Proportionality and Rationality", in Jackson and Tushnet (eds), Proportionality: New Frontiers, New Challenges (2017) 13 at 14. 428 Bendor and Sela, "How proportional is proportionality?" (2015) 13 International Journal of Constitutional Law 530 at 538. 429 Choudhry, "Proportionality: Comparative Perspectives on Israeli Debates", in Sapir, Barak-Erez and Barak (eds), Israeli Constitutional Law in the Making 430 Kaplow, "On the Design of Legal Rules: Balancing Versus Structured Decision Procedures" (2019) 132 Harvard Law Review 992 at 994. and who are "accountable to the people for what they do"431 – must explain how and why a particular decision has been reached, and why particular orders were made. Judges must strive for transparency and clarity in their reasoning. This is not a new concept. However, there is and can be no standardised formula for judicial reasoning. Acknowledging that a goal of proportionality analysis is clarity does not dictate, and, in the context of the Australian common law tradition, tends against, the adoption of one rigid method of analysis. That last statement requires some unpacking. The development of the common law occurs in a unique and restricted way432. The common law can only be developed logically and analogically from existing legal principles433. This analogical quality of common law reasoning differentiates it from other kinds of legal reasoning434. As Gageler J said in McCloy, the difficulty with structured proportionality is that it adopts "standardised criteria"435 to be applied uniformly across all kinds of laws imposing a restriction on political communication. And it is this aspect of structured proportionality that makes it incongruent with the common law judicial method. Each case is fact-specific; each analysis is necessarily case-specific436. The analyses in Unions NSW v New South Wales are illustrative of that approach437. 431 Brown (2017) 261 CLR 328 at 466 [434], quoting ACTV (1992) 177 CLR 106 at 432 See Momcilovic v The Queen (2011) 245 CLR 1 at 156 [392]-[393]; [2011] HCA 34, citing Dixon, "Concerning Judicial Method" (1956) 29 Australian Law Journal 433 Breen v Williams (1996) 186 CLR 71 at 115; [1996] HCA 57. See also Momcilovic (2011) 245 CLR 1 at 155-156 [391]-[393]. 434 Mason, "The Use and Abuse of Precedent" (1988) 4 Australian Bar Review 93 at 435 (2015) 257 CLR 178 at 235 [142]. 436 See McCloy (2015) 257 CLR 178 at 235 [142]; Brown (2017) 261 CLR 328 at 477 437 (2019) 93 ALJR 166 at 175-179 [35]-[57], 181-188 [69]-[102], 189-192 [108]-[118], 195-198 [137]-[153], 202-211 [177]-[222]; 363 ALR 1 at 12-17, 20-28, 30-33, 37-41, 48-59; [2019] HCA 1. The Lange questions provide a standard. The more "rule-like" elements that are introduced into that standard, the further you are taken away from that standard's purpose if the "rules" are applied in a rigid and formalistic way. The rules may impede the development – the filling out – of the content of the standard through the common law method: a case-by-case process of crystallising the meaning of the standard. The benefit of standards, rather than rules, is that standards "leave matters open for renewed consideration in subsequent cases, furnishing future decisionmakers with continued, unrestricted space in which to pursue further refinements of the law"438. The corollary is that standards can generate uncertainty in their application. But the rigid adoption of an analysis like structured proportionality will not always be the answer to that uncertainty. Conclusion and orders For those reasons, so much of Mr Preston's appeal as has been removed into this Court should be dismissed with costs. 438 Coenen, "Rules Against Rulification" (2014) 124 Yale Law Journal 644 at Edelman Consistency and structured proportionality In 2013 and 2014, the Parliament of Tasmania enacted two statutes concerned with on-site protests. One of those statutes, the "Workplace Protesters Act"439, contained provisions seeking to protect businesses from consequences of on-site protests. The other, the "Reproductive Health Act"440, contains provisions seeking to protect women accessing or attempting to access services at termination clinics from consequences of on-site protests. Both Acts were challenged as being contrary to the implied constitutional freedom of political communication. In Brown v Tasmania441, a majority of this Court held that the relevant provisions of the Workplace Protesters Act were invalid. Today, in the Preston appeal, this Court unanimously rejects the submission that the relevant provisions of the Reproductive Health Act are invalid. A clear and principled approach is required in order to distinguish between the decision in Brown v Tasmania, upon which Mr Preston relied heavily, and the outcome in the Preston appeal. Clarity and principle are needed to ensure that the implied freedom of political communication does not become an unlicensed vehicle for a court to remodel public policy by engaging in "an assessment of the relative merits of competing legislative models"442. At best, without a reasoning process requiring precision of thought and expression in the application of the implied freedom of political communication, the result could be a "codeless myriad of precedent, [t]hat wilderness of single instances"443, a direction against which this Court has "from its establishment resolutely set its face"444. 439 Workplaces (Protection from Protesters) Act 2014 (Tas). 440 Reproductive Health (Access to Terminations) Act 2013 (Tas). 441 (2017) 261 CLR 328; [2017] HCA 43. 442 Brown v Tasmania (2017) 261 CLR 328 at 418 [282]. 443 Tennyson, Aylmer's Field (1891) at 14. See Prior v Sherwood (1906) 3 CLR 1054 at 1070; [1906] HCA 29; Fraser v Victorian Railways Commissioners (1909) 8 CLR 54 at 58; [1909] HCA 5; SOS (Mowbray) Pty Ltd v Mead (1972) 124 CLR 529 at 573; [1972] HCA 18; Mallet v Mallet (1984) 156 CLR 605 at 641; [1984] HCA 21. 444 Fraser v Victorian Railways Commissioners (1909) 8 CLR 54 at 58. Edelman Clarity about, and reconciliation of, the reasoning and outcome in Brown v Tasmania and in the Preston appeal is furthered by the application of a three-stage structured proportionality test. Structured proportionality testing provides an analytical, staged structure by which judicial reasoning can be made transparent. The extent of its value will depend upon the content of each stage. However, despite the presence of proportionality testing in many countries, there is no fixed approach within each stage. In Australia, a restrained approach to each stage is required because the freedom of political communication is a limited implication from the Constitution that applies only where it is necessary to ensure the existence and effective operation of the scheme of representative and responsible government protected by the terms of the Constitution. The approach at each stage must also reflect the terms and structure of the Constitution and the operation of the system of government that it instantiates. Those terms and that structure also contain a divide between legislative power and judicial power, which, whilst not clearly delineated, is now deeply embedded445. the Preston appeal three stages of proportionality testing are satisfied. The legislation is valid. However, although the other appeal before this Court, the Clubb appeal, concerns similar provisions in Victorian legislation446, the issue of justification, and the associated proportionality testing, need not be considered in that appeal. the requirements of the The Attorney-General of the Commonwealth submitted that it is not necessary to determine whether the Victorian provisions are invalid because, even if they were invalid, their application to political communication could be "severed". The result, it was submitted, was that in the event of either validity or invalidity the provisions would still apply to Mrs Clubb. That submission should be accepted, although the commonly used expression "severance" is inapt to describe accurately the different process undertaken, which does not involve severing some or all of the words of a provision. The process is one by which the essential meaning of provisions can, if necessary, be disapplied from certain facts or circumstances to which that meaning would otherwise apply. In the Clubb appeal, the relevant provisions could be disapplied from circumstances of political communication if that were necessary to ensure validity. This approach of avoiding giving an answer to a constitutional question is based in part upon a principle of restraint from judicial overreach, which is also 445 See, eg, R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 at 272; [1956] HCA 10. 446 Public Health and Wellbeing Act 2008 (Vic) as amended by the Public Health and Wellbeing Amendment (Safe Access Zones) Act 2015 (Vic). Edelman influence upon the principles of Interpretation and construction require one reading down, severance, and disapplication447. The first task of any court in a case where a provision is alleged to be constitutionally invalid is to interpret and to construe the provision448. the court, before invalidating a provision, to consider whether the provision could be read down, severed, or disapplied in part. The potential applicability of those techniques could mean that constitutional questions of validity need not be considered. If so, then, in the absence of a good reason to do so, the constitutional issue should not be resolved. The constitutional issue need not be resolved in the Clubb appeal. The Clubb appeal The threshold issue The facts and legislation are set out in detail in the joint judgment and, since this appeal can be resolved on what was described by the parties and interveners as the "threshold issue", the facts can be summarised briefly. Mrs Clubb was convicted of contravening s 185D, read with para (b) of the definition of "prohibited behaviour" in s 185B(1) (together, "the communication (Vic) prohibition"), of ("the Public Health Act"). With exceptions for employees and persons providing services at the communication prohibition proscribes communicating, in an area within a radius of 150 m from premises at which abortions are provided, the Public Health and Wellbeing Act 2008 the premises449, "by any means in relation to abortions in a manner that is able to be seen or heard by a person accessing, attempting to access, or leaving premises at which abortions are provided and is reasonably likely to cause distress or anxiety". Mrs Clubb submitted that she did not have sufficient findings of fact to make a positive case that her contravention involved political communication. the In light of the Attorney-General of the Commonwealth and this, 447 Fish, "Constitutional Avoidance as Interpretation and as Remedy" (2016) 114 Michigan Law Review 1275 at 1289. 448 Brown v Tasmania (2017) 261 CLR 328 at 479-481 [485]-[487]. See also Coleman v Power (2004) 220 CLR 1 at 21 [3], 68 [158], 84 [219], 115 [306]; [2004] HCA 39; Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532 at 553 [11]; [2008] HCA 4; Monis v The Queen (2013) 249 CLR 92 at 154 [147]; [2013] HCA 4. 449 Public Health Act, s 185B(2). Edelman Attorney-General of the State of Queensland submitted that a threshold question was whether the operation of the communication prohibition could be "severed" in relation to political communications if it were invalid. If so, there would be no need to determine the constitutional question of the validity of the law because the legislation would be either valid entirely, or valid after severance, and in either case it would apply to Mrs Clubb. In contrast, this submission was the opposed by Attorney-General for the State of New South Wales. the State of Victoria and the Attorney-General for The ultimate conclusion urged by the Commonwealth should be accepted. However, there is a need for clear nomenclature in this area. The contrasting positions taken by different parties and inconsistent terminology. At different times the submission was described as one that was concerned with "reading down", "severance", or "construction". in part, by overlapping and interveners were caused, the Attorney-General of Distinguishing "reading down", "severance", and "partial disapplication" In order to explain the nature of the submission by the Attorney-General of the Commonwealth, it is necessary to distinguish three different concepts. The labels that can be used, which most closely fit the underlying principles, are "reading down", "severance", and "partial disapplication". The labels of "severance" and "reading down" have, on different occasions, been used to describe each of the three different concepts. A clear vocabulary is needed because, despite the overlap in the concepts, the principles underlying each are different and the consequences can be different. "Reading down" is a long-recognised part of the process of interpretation at common law, sometimes justified in cases of potential invalidity by the Latin maxim ut res magis valeat quam pereat450. The process of reading down in such cases involves the court preferring an interpretation of a statutory provision that renders a provision constitutionally valid over one which would render it 450 "It is better for a thing to have effect than to be made invalid". See, eg, Davies and Jones v Western Australia (1904) 2 CLR 29 at 43; [1904] HCA 46; Ex parte Walsh and Johnson; In re Yates (1925) 37 CLR 36 at 93; [1925] HCA 53; Federal Commissioner of Taxation v Munro (1926) 38 CLR 153 at 180; [1926] HCA 58; Australian Railways Union v Victorian Railways Commissioners (1930) 44 CLR 319 at 371-372; [1930] HCA 52; General Practitioners Society v The Commonwealth (1980) 145 CLR 532 at 562; [1980] HCA 30; Coleman v Power (2004) 220 CLR 1 at 88 [227]. Edelman invalid451. This is part of the process of ascertaining the essential meaning of the words of the provision452. The "reading down" approach applies ordinary language techniques by which the essential meaning of the words of a statutory clause is understood based upon past experience and expectations453 and is not limited to a literal, semantic meaning of the individual words. In Ex parte Walsh and Johnson; In re Yates454, Isaacs J expressed the technique as part of the process of ascertaining parliamentary intention based on a presumption that Parliament would be expected to respect recognised legal rules. It may be that the expectation of consistency with the Constitution could also permit "reading up", to a higher level of generality, the essential meaning that a provision would otherwise have had if the provision would be invalid unless it operated in an extended range of circumstances455. It is unnecessary to decide that point. In any event, a provision can only be given a "read down" or "read up" meaning if that meaning is consistent with the legislative intent as manifested in the text456. 451 Macleod v Attorney-General for New South Wales [1891] AC 455 at 458-459; D'Emden v Pedder (1904) 1 CLR 91 at 119-120; [1904] HCA 1; Jumbunna Coal Mine NL v Victorian Coal Miners' Association (1908) 6 CLR 309 at 364; [1908] HCA 95; Osborne v The Commonwealth (1911) 12 CLR 321 at 337; [1911] HCA 19; Federal Commissioner of Taxation v Munro (1926) 38 CLR 153 at 180; Attorney-General (Vict) v The Commonwealth (1945) 71 CLR 237 at 267; [1945] HCA 30; Chu Kheng Lim v Minister for Immigration, Local Government and Ethnic Affairs (1992) 176 CLR 1 at 14; [1992] HCA 64; Residual Assco Group Ltd v Spalvins (2000) 202 CLR 629 at 644 [28]; [2000] HCA 33; New South Wales v The Commonwealth (2006) 229 CLR 1 at 161 [355]; [2006] HCA 52; Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532 at 553 [11]; K-Generation Pty Ltd v Liquor Licensing Court (2009) 237 CLR 501 at 519 [46]; [2009] HCA 4. 452 See Davies and Jones v Western Australia (1904) 2 CLR 29 at 43. 453 See Federal Commissioner of Taxation v Tomaras (2018) 93 ALJR 118 at 137 [100]; 362 ALR 253 at 276; [2018] HCA 62. 454 (1925) 37 CLR 36 at 93; see also at 127. 455 Compare Taylor v Owners – Strata Plan No 11564 (2014) 253 CLR 531 at 547-548 [36]-[37]; [2014] HCA 9. 456 R (Anderson) v Secretary of State for the Home Department [2003] 1 AC 837 at Edelman Where reading down is not possible, the common law also recognises a different doctrine commonly described as "severance". The doctrine of severance, where it applies, permits a court to strike down part of a statute that is beyond power, leaving the remainder of the statute operative457. An entire section or sections of a statute can be struck out under the doctrine of severance. Even part of a section can be struck out, commonly where it can be "blue pencilled"458. The common law doctrine of severance can only be applied if the part of the statute to be severed is independent of the remainder of the statute459. Further, severance is not possible where "the Statute with the invalid portions omitted would be substantially a different law as to the subject matter dealt with by what remains from what it would be with the omitted portions forming part of it"460. A good illustration of the limits of the common law doctrine of severance is the decision of this Court in Owners of SS Kalibia v Wilson461. In that case, there was a challenge to the validity of part of the Seamen's Compensation Act 1909 (Cth) concerning intra-State trade by ships engaged in the coasting trade. This Court unanimously held that the expression "coasting trade" could not be 457 Sedgwick and Pomeroy, A Treatise on the Rules which Govern the Interpretation and Construction of Statutory and Constitutional Law, 2nd ed (1874) at 413-415. See R v Commonwealth Court of Conciliation and Arbitration; Ex parte Whybrow & Co (1910) 11 CLR 1 at 27, 35-36, 45, 54-55; [1910] HCA 33; Owners of SS Kalibia v Wilson (1910) 11 CLR 689 at 698, 701, 715; [1910] HCA 77; Attorney-General (Vict) v The Commonwealth (1945) 71 CLR 237 at 267; British Medical Association v The Commonwealth (1949) 79 CLR 201 at 258; [1949] HCA 44. 458 Attwood v Lamont [1920] 3 KB 571 at 578. See Director of Public Prosecutions v Hutchinson [1990] 2 AC 783 at 804; Re Dingjan; Ex parte Wagner (1995) 183 CLR 323 at 348; [1995] HCA 16; Harrington v Lowe (1996) 190 CLR 311 at 328; [1996] HCA 8. 459 Davies and Jones v Western Australia (1904) 2 CLR 29 at 38; The Federated Amalgamated Government Railway and Tramway Service Association v The New South Wales Railway Traffic Employes Association (1906) 4 CLR 488 at 546-547; [1906] HCA 94; R v Commonwealth Court of Conciliation and Arbitration; Ex parte Whybrow & Co (1910) 11 CLR 1 at 27, 35, 45, 54-55; Waterside Workers' Federation of Australia v J W Alexander Ltd (1918) 25 CLR 434 at 470; [1918] HCA 56. 460 R v Commonwealth Court of Conciliation and Arbitration; Ex parte Whybrow & Co (1910) 11 CLR 1 at 27. 461 (1910) 11 CLR 689. Edelman read down to mean only inter-State coasting trade because Parliament had intended to use the term to mean all trade between different Australian ports462. As the expression could not be read down, the Court considered whether severance was possible. A majority of the Court held that it was not possible to sever the intra-State elements of the provisions from their inter-State elements because the provisions used the "indivisible" and "collective expression" of "coasting trade"463, which necessarily encompassed inter-State and intra-State trade. Griffith CJ said that to sever the statute "would be in effect making a new law"464. Barton J considered that severance would cause the law to be "substantially or radically different"465. O'Connor J said that the Court would "take upon itself the power of making a new law"466. And Isaacs J said that to sever in such circumstances "would therefore be exceeding our functions as interpreters of the law"467. The doctrine of severance was clearly summarised by Barton J468: "[I]f Parliament had enacted that certain specified things, say A, B, and so on down to Z, might lawfully be done, the first half-dozen being within its legislative power and the remainder outside it ... [then] the bad can be separated from the good and excised, and if there be left a law not substantially or radically different, dealing effectively with so much of the subject matter as is within the legislative power, the Act will be good, minus the invalid provisions eliminated." This same approach to severance in contract law, in the context of covenants in unreasonable restraint of trade, has been described as involving the application of a blue pencil to allow severance "where the covenant is not really a single covenant but is in effect a combination of several distinct covenants"469. 462 (1910) 11 CLR 689 at 697-698, 702-703, 708, 712, 718. 463 (1910) 11 CLR 689 at 701-702; see also at 698-699, 709, 715. 464 (1910) 11 CLR 689 at 699. 465 (1910) 11 CLR 689 at 701. 466 (1910) 11 CLR 689 at 709. 467 (1910) 11 CLR 689 at 715. 468 (1910) 11 CLR 689 at 701. 469 Attwood v Lamont [1920] 3 KB 571 at 593; see also S V Nevanas & Co v Walker and Foreman [1914] 1 Ch 413 at 423, both quoted in Heydon, The Restraint of Trade Doctrine, 4th ed (2018) at 303. Edelman Also reflecting a similar constraint to that existing in statutory severance, in contract law the severance must not alter the nature of the contract470. It is a different and much more controversial issue, at least in the absence of a contractual term permitting it, to disapply a contractual clause that would otherwise be void to an extent that would ensure its validity471. After the decision in Owners of SS Kalibia v Wilson, the issue arose again in Newcastle and Hunter River Steamship Co Ltd v Attorney-General for the Commonwealth472. In that case the relevant provisions of the Navigation Act 1912 (Cth) also purported to apply to all ships engaged in the coasting trade. This Court unanimously held that it was beyond Commonwealth power to legislate in relation to ships engaged solely in the domestic trade and commerce of a State473. However, unlike the Seamen's Compensation Act considered in Owners of SS Kalibia v Wilson, the Navigation Act provided, in s 2(2), that the Act be "read and construed ... [as] a valid enactment to the extent to which it is not in excess of that power". The Court did not confine the "read and construe"474 command in s 2(2) to the common law techniques of reading down and severance. Instead, the Court upheld the remainder of the Act, treating s 2(2) as requiring the Court to uphold that part of the subject matter that would be valid, "however interwoven" it is with the invalid part475, provided that, as the Court later explained, it does not "manufacture a new web"476. That legislative command had the effect that the provisions of the Act operated "in respect of all ships to which they might lawfully be applied"477. The provisions were 470 SST Consulting Services Pty Ltd v Rieson (2006) 225 CLR 516 at 531 [46]; [2006] HCA 31; Heydon, The Restraint of Trade Doctrine, 4th ed (2018) at 304, citing Mason v Provident Clothing and Supply Co Ltd [1913] AC 724 at 745 and Attwood v Lamont [1920] 3 KB 571 at 580. 471 See, eg, Baines v Geary (1887) 35 Ch D 154 at 159; Foltz v Struxness (1950) 215 P 2d 133 at 138. See also Heydon, The Restraint of Trade Doctrine, 4th ed (2018) at 309 fn 127, 314 fn 146 and the cases cited therein; cf at 314-315. 472 (1921) 29 CLR 357; [1921] HCA 31. 473 (1921) 29 CLR 357 at 368-369. 474 Compare Human Rights Act 1998 (UK), s 3(1): "read and given effect". 475 (1921) 29 CLR 357 at 369. 476 Australian Railways Union v Victorian Railways Commissioners (1930) 44 CLR 477 (1921) 29 CLR 357 at 370. Edelman effectively disapplied to the type of trading to which they could not validly be applied. The distinction between this partial disapplication, on the one hand, and reading down and severance, on the other, is significant. Reading down is the exercise of an interpretative power to expound meaning. Severance is the exercise of a power to recognise the invalidity of, and to sever, a substantially independent part of a statute or provision. In the process of severance, it is not relevant that the legislature might have preferred partial operation of the statute in place of no operation "if [it] had applied [its notional] mind to the subject"478. As Griffith CJ explained479, what a legislature "would have done in a state of facts which never existed is a matter of mere speculation". In both cases of reading down and cases of severance, the essential meaning of the statutory text as read down or as severed is applied to the facts. Unlike reading down or severance, the partial disapplication technique under s 2(2) of the Navigation Act, as recognised in Newcastle and Hunter River Steamship Co Ltd, does not apply the essential meaning to all of the facts or circumstances before the court. The essential meaning of "the coasting trade" in that case could not be read down to mean "the inter-State coasting trade"480. Nor could any part of the "one collective expression"481 used in the relevant provisions be severed from a valid remainder. Instead, the provisions concerning ships engaged in the coasting trade were disapplied to ships engaged in the intra-State coasting trade482. The underlying premise of the partial disapplication approach in Newcastle and Hunter River Steamship Co Ltd was the statutory command in s 2(2) that, in order to preserve constitutional validity, the essential meaning of statutory words which cannot be read down or severed is not applied generally to all facts and circumstances that would otherwise have been encompassed. Without a for statutory command, evidencing a partial disapplication, that approach would not have been possible. intention statutory 478 Owners of SS Kalibia v Wilson (1910) 11 CLR 689 at 699; cf at 722. 479 R v Commonwealth Court of Conciliation and Arbitration; Ex parte Whybrow & Co (1910) 11 CLR 1 at 27; see also at 35, 45 and Director of Public Prosecutions v Hutchinson [1990] 2 AC 783 at 813. 480 (1921) 29 CLR 357 at 367-368. 481 (1921) 29 CLR 357 at 369. 482 (1921) 29 CLR 357 at 369-370. Edelman The partial disapplication approach requires a distinction, which commonly (but not entirely accurately) is described as one between meaning and application483. In United States constitutional and administrative law, the legal approach to each concept has been described as involving a difference, respectively, between interpretation and construction484, although it is the distinction that is important rather than the labels. A similar point has been made in relation to statutes485, wills486 and, although "underappreciated"487, contracts488. 483 Street v Queensland Bar Association (1989) 168 CLR 461 at 537; [1989] HCA 53; Re Wakim; Ex parte McNally (1999) 198 CLR 511 at 551-552 [42]; [1999] HCA 27; Birmingham City Council v Oakley [2001] 1 AC 617 at 631; R v G [2004] 1 AC 1034 at 1054 [29]. See also Peterswald v Bartley (1904) 1 CLR 497 at 508; [1904] HCA 21. Or connotation and denotation: Ex parte Professional Engineers' Association (1959) 107 CLR 208 at 267; [1959] HCA 47; Lake Macquarie Shire Council v Aberdare County Council (1970) 123 CLR 327 at 331; [1970] HCA 32; State Superannuation Board v Trade Practices Commission (1982) 150 CLR 282 at 297; [1982] HCA 72; The Commonwealth v Tasmania (The Tasmanian Dam Case) (1983) 158 CLR 1 at 302-303; [1983] HCA 21; Davis v The Commonwealth (1988) 166 CLR 79 at 96; [1988] HCA 63; McGinty v Western Australia (1996) 186 CLR 140 at 200; [1996] HCA 48; Eastman v The Queen (2000) 203 CLR 1 at 45 [142]; [2000] HCA 29; Singh v The Commonwealth (2004) 222 CLR 322 at 343-344 [37]-[38]; [2004] HCA 43. 484 Solum, "The Interpretation-Construction Distinction" (2010) 27 Constitutional Commentary 95 at 100-103; Solum and Sunstein, "Chevron as Construction", paper, December 2018, available at <https://ssrn.com/abstract=3300626>. See also Whittington, Constitutional Interpretation: Textual Meaning, Original Intent, and Judicial Review (1999) at 6-8; Barnett, Restoring the Lost Constitution: The Presumption of Liberty, rev ed (2014) at 102; Balkin, Living Originalism 485 Lieber, Legal and Political Hermeneutics, enlarged ed (1839) at 23, 56. Compare Sedgwick and Pomeroy, A Treatise on the Rules which Govern the Interpretation and Construction of Statutory and Constitutional Law, 2nd ed (1874) at 191-192. 486 See Atkinson, Handbook of the Law of Wills, 2nd ed (1953), §146 at 809-810, 814, 816. See also American Law Institute, Restatement (Third) of the Law of Property: Wills and Other Donative Transfers (2003), §10.1 at 276, §11.3 at 333. 487 Cunningham, "Hermeneutics and Contract Default Rules: An Essay on Lieber and Corbin" (1995) 16 Cardozo Law Review 2225 at 2246. 488 Corbin, "Conditions in the Law of Contract" (1919) 28 Yale Law Journal 739 at 740-741. See also Corbin, Corbin on Contracts, rev ed (1960) §534 at 9, 12-13; Patterson, "The Interpretation and Construction of Contracts" (1964) 64 Columbia (Footnote continues on next page) Edelman Statutory commands to read down, to sever, and for partial disapplication The powers of reading down, severance, and partial disapplication were all given a generalised application in 1930 when the Commonwealth Parliament enacted s 15A of the Acts Interpretation Act 1901 (Cth)489. Section 15A has been described as a "direction to every Court"490 to exercise those powers unless a contrary intention appears in the impugned legislation. As explained in the Second Reading Speech for the Acts Interpretation Act 1930 (Cth), s 15A replicated s 2(2) of the Navigation Act. In the Second Reading Speech, the Vice-President of the Executive Council noted that this Court had held that, at common law, "where the valid and invalid provisions of an act are inseparable or 'wrapped up in the same word or expression' the whole must fail"491. He said that this result could be avoided by the proposed s 15A, which would make a provision like s 2(2) of the Navigation Act "common to Commonwealth legislation"492. The Leader of the Opposition, who had introduced a relevantly identical Bill in the previous Parliament493, described the effect of the proposed s 15A as to "deprive [a litigant] of an argument" that an Law Review 833 at 833, 835; American Law Institute, Restatement (Second) of the Law of Contracts (1981), §200 at 82; Rowley, "Contract Construction and Interpretation: From the 'Four Corners' to Parol Evidence (and Everything in Between)" (1999) 69 Mississippi Law Journal 73 at 79-80. 489 By s 3 of the Acts Interpretation Act 1930 (Cth); repealed and substituted in effectively the same terms by the Acts Interpretation Act 1937 (Cth). 490 Australian Railways Union v Victorian Railways Commissioners (1930) 44 CLR 319 at 374; see also at 373 and R v Poole; Ex parte Henry [No 2] (1939) 61 CLR 634 at 652; [1939] HCA 19. 491 Australia, Senate, Parliamentary Debates (Hansard), 7 August 1930 at 5545, referring to R v Commonwealth Court of Conciliation and Arbitration; Ex parte Whybrow & Co (1910) 11 CLR 1 at 54, 55 and Owners of SS Kalibia v Wilson (1910) 11 CLR 689 at 713. 492 Australia, Senate, Parliamentary Debates (Hansard), 7 August 1930 at 5545, referring to Newcastle and Hunter River Steamship Co Ltd v Attorney-General for the Commonwealth (1921) 29 CLR 357. 493 Australia, Senate, Parliamentary Debates (Hansard), 7 August 1930 at 5545. Edelman Act is invalid in its entirety because some of its provisions would be constitutionally invalid494. Equivalent provisions were subsequently enacted, and remain in existence, in each State and Territory495. The relevant provision in the Clubb appeal is s 6(1) of the Interpretation of Legislation Act 1984 (Vic), which provides as follows: "Every Act shall be construed as operating to the full extent of, but so as not to exceed, the legislative power of the State of Victoria, to the intent that where a provision of an Act, or the application of any such provision to any person, subject-matter or circumstance, would, but for this section, have been construed as being in excess of that power, it shall nevertheless be a valid provision to the extent to which it is not in excess of that power and the remainder of the Act and the application of that provision to other persons, subject-matters or circumstances shall not be affected." In addition to the duty to "read down", the terms of s 6(1) contemplate a further "two distinct situations"496. The first is the principle of severance ("the remainder of the Act ... shall not be affected"). Unlike the common law, where an Act would generally be expected to operate as a whole so that severance was treated as unlikely to have been intended, the legislative approach to the principle of severance was held to create a "presumption"497 that Parliament intended that a provision be severable from the remainder of the statute or from the remainder of its valid parts. The second situation, which did not exist at common law but confusingly was also described sometimes as severance and sometimes as reading down, is the principle of partial disapplication ("the application of that provision to other persons, subject-matters or circumstances shall not be affected"). In Bank of NSW v The Commonwealth498, Rich and Williams JJ 494 Australia, House of Representatives, Parliamentary Debates (Hansard), 8 August 495 Interpretation Act 1987 (NSW), s 31; Interpretation of Legislation Act 1984 (Vic), s 6; Acts Interpretation Act 1915 (SA), s 22A; Acts Interpretation Act 1954 (Qld), s 9; Interpretation Act 1984 (WA), s 7; Acts Interpretation Act 1931 (Tas), s 3; Interpretation Act (NT), s 59; Legislation Act 2001 (ACT), s 120. 496 Victoria v The Commonwealth (1996) 187 CLR 416 at 502; [1996] HCA 56. See also R v Poole; Ex parte Henry [No 2] (1939) 61 CLR 634 at 652; Strickland v Rocla Concrete Pipes Ltd (1971) 124 CLR 468 at 516-517; [1971] HCA 40. 497 Bank of NSW v The Commonwealth (1948) 76 CLR 1 at 163, 313, 371; [1948] HCA 7; Re F; Ex parte F (1986) 161 CLR 376 at 384; [1986] HCA 41. 498 (1948) 76 CLR 1 at 252. Edelman described these two principles of severance and disapplication in the context of s 6 of the Banking Act 1947 (Cth). Their Honours said that s 6 was capable of giving effect to a provision that would otherwise be inconsistent with the Constitution in two situations: "where [(i)] the provision contains independent portions within power which are severable, or [(ii)] the provision is capable of operating in a distributive manner in respect of each and every part of the subject matter and its operation can be confined to those parts which are within power". Similarly, Dixon J spoke of the difference between (i) severing or "separating clauses or expressions", and (ii) confining a provision "in its operation to so much of the subject it is capable of covering as is constitutionally competent to the legislature, or, as it is sometimes said, whether the general words are to be read and applied distributively"499. The technique of partial disapplication cannot be used if it would alter a statute's general policy or scheme or the specific policy or purpose of the relevant provision. To do so would cross the line between adjudication and legislation. One way in which the general policy or scheme of a statute or a provision could be altered is where the partial disapplication would lead to a result that contradicts or alters any policy of the statute. An obvious instance of contradiction is where the statute or provision evinces a "contrary intention"500 that it "have either a full and complete operation or none at all"501. An instance where the policy of the statute or provision could be altered might be if there were various equally available methods of partial disapplication, so that the provision could "be reduced to validity by adopting any one or more of a number of several possible limitations"502. 499 (1948) 76 CLR 1 at 369. See also Melbourne Corporation v The Commonwealth (1947) 74 CLR 31 at 76; [1947] HCA 26, speaking of "severance" and "restriction". 500 Interpretation of Legislation Act, s 4(1)(a). 501 Cam & Sons Pty Ltd v The Chief Secretary of New South Wales (1951) 84 CLR 442 at 454; [1951] HCA 59. See also R v Poole; Ex parte Henry [No 2] (1939) 61 CLR 634 at 652; Pidoto v Victoria (1943) 68 CLR 87 at 108; [1943] HCA 37; Victoria v The Commonwealth (1996) 187 CLR 416 at 502. 502 Victoria v The Commonwealth (1996) 187 CLR 416 at 502. Compare Pidoto v Victoria (1943) 68 CLR 87 at 111; Re Nolan; Ex parte Young (1991) 172 CLR 460 at 485; [1991] HCA 29; Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 61; [1992] HCA 46; Re Dingjan; Ex parte Wagner (1995) 183 CLR 323 at 339, 349, Edelman A second instance where a general policy or scheme will be altered is where the statute or provision, after partial disapplication, would operate differently upon the remaining subject matter from how it would have operated without partial disapplication503. For this reason, "the enactment, when read distributively, must operate upon the persons and things affected by it in the same way as it would have operated if it had been entirely valid"504. Although partial disapplication cannot occur in these instances where a policy or scheme would be contradicted or altered, no party or intervener submitted that the power of partial disapplication that is sanctioned by statute would otherwise be contrary to the exercise of judicial power505. In summary, if it is not "fairly open" to read the provision down so that it is consistent with the Constitution506 then, provided that partial disapplication does not alter the policy or scheme of the legislation so that the court does not exceed judicial power, there is almost no limit on the extent to which the effect of a provision can be disapplied. Thus, the operation of the essential meaning of the coasting trade was disapplied from the intra-State coasting trade507 and other provisions have been held capable of disapplication from inter-State trade508. Similarly, although described in the language of "reading down", the operation of the essential meaning of "person" has been disapplied to exclude a judge of a court exercising 503 Vacuum Oil Co Pty Ltd v Queensland [No 2] (1935) 51 CLR 677 at 692; [1935] HCA 9; Pidoto v Victoria (1943) 68 CLR 87 at 111; Bank of NSW v The Commonwealth (1948) 76 CLR 1 at 369-370; Strickland v Rocla Concrete Pipes Ltd (1971) 124 CLR 468 at 493; Re Nolan; Ex parte Young (1991) 172 CLR 460 at 486; Re Dingjan; Ex parte Wagner (1995) 183 CLR 323 at 339; Victoria v The Commonwealth (1996) 187 CLR 416 at 502. 504 Re F; Ex parte F (1986) 161 CLR 376 at 385. See also Pidoto v Victoria (1943) 68 CLR 87 at 110-111. 505 cf Pidoto v Victoria (1943) 68 CLR 87 at 108-109. 506 Bourke v State Bank of New South Wales (1990) 170 CLR 276 at 284; [1990] HCA 507 Newcastle and Hunter River Steamship Co Ltd v Attorney-General for the Commonwealth (1921) 29 CLR 357 at 370. 508 Cam & Sons Pty Ltd v The Chief Secretary of New South Wales (1951) 84 CLR 442 at 454, 456; Carter v The Potato Marketing Board (1951) 84 CLR 460 at 477; [1951] HCA 60; Grannall v Marrickville Margarine Pty Ltd (1955) 93 CLR 55 at 73; [1955] HCA 6; Nominal Defendant v Dunstan (1963) 109 CLR 143 at 151-152; [1963] HCA 5. Edelman the judicial power of the Commonwealth509. Finally, in an example closer to the circumstances of this appeal, the operation of the essential meaning of using insulting words in a public place was disapplied by one Justice of this Court to exclude "words uttered in discussing or raising matters concerning politics and government"510. The Public Health Act cannot be read down or severed The relevant provision of the Public Health Act is s 185D, which provides that a person "must not engage in prohibited behaviour within a safe access zone". "Prohibited behaviour" is defined in s 185B(1), with exceptions for employees and service providers, to include "communicating by any means in relation to abortions in a manner that is able to be seen or heard by a person accessing, attempting to access, or leaving premises at which abortions are provided and is reasonably likely to cause distress or anxiety". If it were necessary to read down the communication prohibition in the Public Health Act to avoid any invalidity then s 185D, when read with s 185B, would need to be given a meaning as though it contained the words "communicating by any means in relation to abortions other than in the course of political communication". On that meaning, if the words were read into the provision as intended elements of the offence, rather than exceptions intended to be proved by the defence511, then the prosecution would have been required to prove that Mrs Clubb's communication was not political. It did not do so. However, s 185D of the Public Health Act cannot be read down in this manner. The meaning of the words of Parliament, in this respect, is clear. When interpreting the essential meaning of the words, Parliament's "choice should be respected even if the consequence is constitutional invalidity"512. To give s 185D a different meaning by reading down the communication prohibition to exclude political communication would be to make "an insertion which is 'too big, or too much at variance with the language in fact used by the 509 Wilson v Minister for Aboriginal and Torres Strait Islander Affairs (1996) 189 CLR 1 at 20, 26; [1996] HCA 18. See also Knight v Victoria (2017) 261 CLR 306 at 325 [34]; [2017] HCA 29. 510 Coleman v Power (2004) 220 CLR 1 at 56 [110]. 511 Criminal Procedure Act 2009 (Vic), s 72. See also Vines v Djordjevitch (1955) 91 CLR 512 at 519-520; [1955] HCA 19; Chugg v Pacific Dunlop Ltd (1990) 170 CLR 249 at 257-259; [1990] HCA 41. 512 International Finance Trust Co Ltd v New South Wales Crime Commission (2009) 240 CLR 319 at 349 [42]; [2009] HCA 49. Edelman legislature'"513. That variance would also have the effect of drastically reducing the intelligibility of the law to those who administer it, here prosecutors, and those who are subject to it. Nor would it be possible, if s 185D of the Public Health Act contravened the implied freedom of political communication, for any contravening parts to be severed from the remainder of the statute. Even with the benefit of the presumption that Parliament intended that otherwise invalid parts of the Public Health Act could be severed from the remainder of the Act, there is no part of s 185B or s 185D that can be severed from any other part of the communication prohibition. The Public Health Act could be partially disapplied if necessary In contrast with reading down and severance, s 185D of the Public Health Act could be partially disapplied to reduce the sphere of operation of the communication prohibition. The command to courts in s 6(1) of the Interpretation of Legislation Act requires partial disapplication, if necessary to avoid invalidity, provided that the partial disapplication does not alter the policy or scheme of the legislation. the Attorney-General for Section 185D is not exclusively concerned with political communication. the State of Victoria submitted, not all communications about termination are political, giving examples of a medical professional speaking about termination at a health conference or a woman discussing termination procedures with her doctor. So too, there might be non-political communications about termination that fall within the considerable breadth of the communication prohibition. If the communication prohibition were disapplied to instances of communication on government and political matters then its operation in the remaining sphere of communications would be unaltered. Although this disapplication could eviscerate the operation of the statute if the majority of communications were political, the statutory policy would operate upon the vastly reduced content of non-political communication in the same way as it did before disapplication. And there is no express or implied suggestion in the Public Health Act that the need to protect the safety, privacy, and dignity of clinic workers and visitors should be all-or-nothing. 513 Taylor v Owners – Strata Plan No 11564 (2014) 253 CLR 531 at 548 [38], quoting Western Bank Ltd v Schindler [1977] Ch 1 at 18. Edelman The possibility of disapplication is sufficient to dispose of the appeal There can be no doubt that Mrs Clubb is directly and immediately interested in whether the communication prohibition, under which she was convicted, infringes the implied freedom of political communication, and thus has standing to bring her challenge. However, even if s 185D of the Public Health Act were found to lack compliance with the implied freedom of political communication and the communication prohibition would still have a valid sphere of operation in relation to Mrs Clubb because of the lack of evidence from which it could be concluded that her communications were political. Even Mrs Clubb conceded that if disapplication were possible there were insufficient facts from which the magistrate could have concluded that the legislation did not apply to her. require disapplication, Mrs Clubb's submission that it was for the prosecution to prove that her speech was not political should not be accepted. Interpretative issues, including reading down or severance of provisions imposing criminal liability, establish the elements that the prosecution must prove. But the process of determining the essential meaning of a provision, or its partial disapplication, is an issue for the court and not a matter upon which any party bears an onus. If a provision is to be disapplied from particular facts or circumstances then unless the court is satisfied of the presence of those facts or circumstances its duty is to apply the legislation. the constitutional The effect of possible disapplication by s 6(1) of the Interpretation of Legislation Act, as with s 15A of the Acts Interpretation Act, is that on any view adjudication upon issue could not affect Mrs Clubb. Consistently with the legislative purpose of s 15A and its successors, the recognition of the possibility of disapplication operates to "deprive [Mrs Clubb] of an argument"514 that the communication prohibition is invalid. Therefore, there is no good reason to adjudicate upon the validity of s 185D of the Public Health Act. The Preston appeal Background and legislation On three occasions during 2014 and 2015, Mr Preston was on the footpath of a street that was within 150 m from premises at which terminations515 are 514 Australia, House of Representatives, Parliamentary Debates (Hansard), 8 August 515 The Tasmanian legislation uses the more dignified language of termination, avoiding "abortion", a word used "throughout history in a derogatory manner to demean Tasmania, House of Assembly, stigmatise women": Parliamentary Debates (Hansard), 16 April 2013 at 47. and Edelman provided. On each occasion, Mr Preston engaged in a protest against the termination of pregnancies that could be seen and heard by persons who were accessing or attempting to access the premises. He held signs and placards with statements including "EVERY ONE HAS THE RIGHT TO LIFE, Article 3, Universal Declaration of Human Rights" and "EVERY CHILD HAS THE RIGHT TO LIFE, Article 6, UN Convention on the Rights of the Child", and images depicting a foetus at eight weeks, including one image of a foetus bearing the description "8 week pre-born baby". On one occasion, Mr Preston spoke to a woman who intended to access the premises. The woman gave evidence that she had felt intimidated and uncomfortable after seeing his placards and had reconsidered entry to the premises. Mr Preston was charged with three offences under s 9(2) of the Reproductive Health Act corresponding with each of the occasions described above. The offence in s 9(2), which carried a maximum penalty of one year's imprisonment or a fine of 75 penalty units or both, is engaging in "prohibited behaviour within an access zone". An "access zone" is an area within a radius of 150 m from the premises at which terminations are provided516. The better interpretation of this definition is that the radius commences at either the entrance to the premises or, perhaps more accurately, the perimeter of the building rather than, as was suggested during debate in Victoria concerning the Public Health Act, from the perimeter of the land on which the premises are situated517. Nevertheless, even the more limited interpretation creates a very large access zone amounting to the circular equivalent of more than 70,000 m2. intimidating, "Prohibited behaviour" includes interference with a person as well as besetting, harassing, threatening, hindering, obstructing or impeding a person518. It includes, without consent, "intentionally recording, by any means, a person accessing or attempting to access premises at which terminations are provided"519. It also includes footpath interference in relation to terminations520, which in certain circumstances may encompass even passively standing in a person's path while wearing a t-shirt with an offensive message 516 Reproductive Health Act, s 9(1). 517 Victoria, Legislative Council, Parliamentary Debates (Hansard), 24 November 518 Reproductive Health Act, s 9(1) (definition of "prohibited behaviour", para (a)). 519 Reproductive Health Act, s 9(1) (definition of "prohibited behaviour", para (d)). 520 Reproductive Health Act, s 9(1) (definition of "prohibited behaviour", para (c)). Edelman about terminations521. And, relevantly to this case, prohibited behaviour includes, by para (b) of the definition in s 9(1): "a protest in relation to terminations that is able to be seen or heard by a person accessing, or attempting to access, premises at which terminations are provided". Unlike the British Columbia model522, which was considered in cases to which the parties and interveners referred, "protest" is not defined in the Reproductive Health Act. However, its context523 reinforces its ordinary meaning, similar to the definition in the British Columbia legislation524, of communication of objection or disapproval in a public place. On its face, that ordinary meaning does not discriminate between objection or disapproval "in relation to terminations" that conveys disapproval of terminations and objection or disapproval "in relation to terminations" that conveys disapproval of those who oppose terminations. "Accessing" and "attempting to access" bear their ordinary meaning of a person who is intentionally en route to premises at which terminations are provided. That ordinary meaning is supported by the usual requirement that there be an intentional act in order for an attempt to be made out. It is at least arguable that there are implied requirements in para (b) of the definition of "prohibited behaviour" in s 9(1) that the protest must be intended to be in relation to terminations and that an accused person must intend to communicate within the access zone525. It suffices to proceed on this assumption because even if there were no mental element requiring a person to know that he or she was within a 150 m radius of the premises at which terminations are provided, or even if there were an excuse of honest and reasonable mistake526, for 521 Tasmania, Legislative Council, Parliamentary Debates (Hansard), 20 November 522 Access to Abortion Services Act, RSBC 1996, c 1, ss 1, 2(1). 523 See also Tasmania, House of Assembly, Parliamentary Debates (Hansard), 16 April 2013 at 50. 524 Access to Abortion Services Act, RSBC 1996, c 1, s 1. 525 See also He Kaw Teh v The Queen (1985) 157 CLR 523 at 528-529, 546, 565-567; [1985] HCA 43. 526 He Kaw Teh v The Queen (1985) 157 CLR 523 at 534-535, 550, 573-574, 591-592. Edelman reasons that I explain below the constitutional validity of the provision would be unaffected. Magistrate Rheinberger convicted Mr Preston of each of the three offences under s 9(2) of the Reproductive Health Act, as well as a further offence of failing to comply with a direction of a police officer. He was fined $3,000 in total for all the offences. The magistrate also rejected Mr Preston's submission that s 9(2) was contrary to the implied freedom of political communication and was therefore invalid. Mr Preston sought review in the Supreme Court of Tasmania of the decision of the magistrate. Six of his grounds of review were removed into this Court. Each of the six grounds of his amended notice of appeal in this Court concern whether the "protest prohibition", in s 9(2) of the Reproductive Health Act read with para (b) of the definition of "prohibited behaviour" in s 9(1), is invalid because it is contrary to the implied constitutional freedom of political communication. The implied freedom of political communication The freedom of political communication that is implied in the Constitution is a constraint upon the exercise of power. The constraint is against the imposition of undue burdens on political communication. In broad terms, the conditions for when a law will impose an undue burden have been accepted for over two decades since the decision of this Court in Lange v Australian Broadcasting Corporation527. Those broad terms involve twin concerns about (i) the purpose of imposing a burden upon political communication, and (ii) the effect of imposing that burden upon political communication. The test that has developed to address the twin concerns of the purpose and the effect of a burden upon political communication involves asking the following: (i) whether there is a burden upon political communication, since freedom of political communication requires an anterior liberty to act; (ii) whether the law that imposes the burden has a legitimate purpose, in other words whether the law illegitimately has the very purpose of imposing the burden rather than merely doing so as a consequence of pursuing some other purpose; and (iii) whether the effect of the burden upon political communication is undue or unjustified by reference to the legitimate purpose. The burden upon freedom of political communication The implied freedom of political communication is not confined to communication by way of oral words. It includes political communication by 527 (1997) 189 CLR 520 at 561-562; [1997] HCA 25. Edelman "[s]igns, symbols, gestures and images"528. Protest – that is, the public communication of objection or disapproval – by signs, symbols, gestures, and images is one of the loudest forms of political communication. Protest is almost inextricably linked with matters of political and governmental content. And protest, as a public expression of objection in terminations, has a particularly powerful association with relation communication on political matters. It was not in dispute that the protest prohibition in the Reproductive Health Act is a burden upon the implied freedom of political communication. In the context of Australia's history of political debate about including his references to the Universal Declaration of Human Rights and the United Nations Convention on the Rights of the Child, were political. There is, therefore, no utility in considering as a threshold issue before the constitutional issue, whether the protest prohibition can be disapplied. The issue of disapplication only falls to be considered if the protest prohibition is contrary to the implied freedom of political communication. The legitimacy of the law's purpose The Reproductive Health Act does not contain any express statement of its purposes, either generally or of any of the forms of prohibited behaviour in s 9(1). The purpose falls to be discerned, at the appropriate level of generality, by reference to the meaning or range of meanings of the words of the provision, the meanings of other provisions in the statute, historical background, and any social objective of the law529. The short title (the "Reproductive Health (Access to Terminations) Act") and the principal Part (Pt 2, "Access to Terminations") provide a clear indication of the general purposes of the Act. The information paper which was part of the extrinsic materials preceding the Act explained that "reproductive health" was concerned with "a state of complete physical, mental and social wellbeing" in association with the "reproductive processes, functions and system"530. It was said that the previous law, derived from nineteenth century laws in the United Kingdom and Ireland, needed to change to recognise that unplanned pregnancies will occur, to remove criminal regulation of access to terminations, 528 Levy v Victoria (1997) 189 CLR 579 at 622-623; see also at 595, 613, 638; [1997] HCA 31. 529 Unions NSW v New South Wales (2019) 93 ALJR 166 at 201 [171]; 363 ALR 1 at 46; [2019] HCA 1. 530 Tasmania, Department of Health and Human Services, Information Paper relating to the Draft Reproductive Health (Access to Terminations) Bill (2013) at 3. Edelman to remove a barrier to health care services, to acknowledge women as capable decision makers, to recognise that termination is a safe medical procedure, and to recognise community standards531. the Reproductive Health Act is, perhaps unsurprisingly, women's reproductive health in the widest sense. the purpose of its core, The terms of the protest prohibition form part of a series of prohibited behaviours in s 9(1) that are all concerned with protection of women within the access zone of a premises at which terminations are provided. This protection is an integral aspect of Pt 2 of the Act, "Access to Terminations", by which certain medical terminations are made lawful. In that context, the purpose of the protest prohibition is to ensure that women of any age532 seeking access to medical termination services can do so in safety and without further fear, intimidation, or distress. As the Minister said in the Second Reading Speech, "[w]omen are entitled to access termination services in a confidential manner without the threat of harassment"533. At the higher level of generality of the Act as a whole, the purpose is avowedly concerned with health. At any level of generality the purpose is legitimate. Mr Preston identified a number of putative purposes of the protest prohibition which he said were illegitimate, including the following: (i) to deter speech that aims to dissuade or delay women from accessing terminations; (ii) to deter speech that the Minister considered to be "unacceptable"; (iii) to handicap one side of the termination debate; (iv) to prevent persons from being confronted with a protest in relation to terminations; and (v) to deter speech that causes shame. Each of these submissions might describe a possible effect of the law. None describes its purpose. Justification of the burden by reference to the purpose: proportionality testing In Lange534, the expression "reasonably appropriate and adapted" was adopted535 as a test of whether a law's burden upon the implied freedom of 531 Tasmania, Department of Health and Human Services, Information Paper relating to the Draft Reproductive Health (Access to Terminations) Bill (2013) at 6-12. 532 Reproductive Health Act, s 3(1). 533 Tasmania, House of Assembly, Parliamentary Debates (Hansard), 16 April 2013 at 534 (1997) 189 CLR 520 at 562, 567. 535 See, earlier, Cunliffe v The Commonwealth (1994) 182 CLR 272 at 300, 324, 388; [1994] HCA 44; cf Richardson v Forestry Commission (1988) 164 CLR 261 at 289, 300, 311-312, 324, 336, 345; [1988] HCA 10. Edelman political communication is justified. That phrase has been criticised. It has been described as an "ungainly and unedifying phrase" which is "inappropriate and ill-adapted to perform the constitutional function repeatedly assigned to it by members of this Court"536. It is a hendiadys. As Heydon J observed in Monis v The Queen537, "appropriate" adds nothing to "adapted". And, as Heydon J also observed in the same case538, "reasonably" adds nothing to whether the law is appropriate or adapted. It could hardly be said that a law is unreasonably appropriate. And it would be a mistake to understand "reasonably appropriate" as shorthand for "reasonably capable of being regarded as appropriate and adapted"539, because a law that is not "appropriate" is not valid because it is reasonably capable of being regarded as appropriate by some. In each of (i) McCloy v New South Wales540; (ii) Brown v Tasmania541; (iii) Unions NSW v New South Wales542; and (iv) this appeal, a majority of this Court has articulated an approach to justification of a burden upon the implied freedom that has avoided directly deploying the phrase "reasonably appropriate and adapted". The focus is instead upon a three-stage test described as "proportionality". Although, at a high level of generality, the framework for proportionality testing is broadly similar in most jurisdictions, the detail can vary across jurisdictions and even within jurisdictions543. However, the test for proportionality has sometimes been criticised without explanation of the precise concept that is being criticised. It is necessary to explain how the concept differs 536 Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 266 [247]; [2004] HCA 41. See also Coleman v Power (2004) 220 CLR 1 at 90 [234]; Thomas v Mowbray (2007) 233 CLR 307 at 417 [316]; [2007] HCA 33. 537 (2013) 249 CLR 92 at 182 [246]. 538 (2013) 249 CLR 92 at 182 [246]. 539 See Cunliffe v The Commonwealth (1994) 182 CLR 272 at 339; Langer v The Commonwealth (1996) 186 CLR 302 at 318, 334; [1996] HCA 43; cf Cunliffe v The Commonwealth (1994) 182 CLR 272 at 388; Coleman v Power (2004) 220 CLR 1 at 48 [87]. 540 (2015) 257 CLR 178 at 194-195 [2]-[3]; [2015] HCA 34. 541 (2017) 261 CLR 328 at 368-369 [123]-[127], 416-417 [278]. 542 (2019) 93 ALJR 166 at 177 [42], 190 [110]; 363 ALR 1 at 13-14, 31. 543 Ramshaw, "The case for replicable structured full proportionality analysis in all cases concerning fundamental rights" (2019) 39 Legal Studies 120 at 121-123. Edelman in Australia from other approaches that might be criticised as lacking direct relevance to this jurisdiction. The three-stage test of proportionality adapted in this area of Australian legal discourse requires the law to be: (i) suitable, in other words rationally connected to its purpose; (ii) necessary, in the sense that there were not reasonably practicable alternatives of equal efficacy that would have been expected to be substantially less burdensome upon the freedom of political communication; and (iii) adequate in the balance between the purpose to be achieved by the law and the burden imposed upon the freedom. The three stages of proportionality testing elucidate and structure the thinking process, which may otherwise be opaque. Duplication is avoided because if a case fails at one stage it is unnecessary to consider whether subsequent stages are satisfied. The concept of "proportionality" has been described as foreign in origin. That description is correct. It would also be correct to describe much of our inherited "common" law, in its true character as law that is common, as foreign in origin. As Pound said544, the "[h]istory of a system of law is largely a history of borrowings of legal materials from other legal systems and of assimilation of materials from outside of the law. ... For except as an act of omnipotence, creation is not the making of something out of nothing." That a legal doctrine originated in a foreign legal system does not render it unsuitable or inapplicable if it is adapted to local circumstances. But the adoption of a foreign concept that is ill-suited to resolving conflicting rights or freedoms will not benefit local jurisprudence. A focus upon whether a law is "reasonably appropriate and adapted" is itself such an ill-suited foreign concept. It was imported into Australia from the United States545. But even in the United States it is not used as a test for balancing the First Amendment freedom with other freedoms and rights. Instead, the balancing technique adopted in the United States, which might itself be a concealed form of proportionality546, is said to have entered American legal jurisprudence through the writing of 544 Pound, The Formative Era of American Law (1938) at 94-95. 545 McCulloch v Maryland (1819) 17 US 316 at 421. See Coleman v Power (2004) 220 CLR 1 at 90 [234]; Rowe v Electoral Commissioner (2010) 243 CLR 1 at 131 [427], 133 [431]; [2010] HCA 46; Monis v The Queen (2013) 249 CLR 92 at 213 546 District of Columbia v Heller (2008) 554 US 570 at 689-690; United States v Alvarez (2012) 567 US 709 at 730: see below at [503]. Edelman Holmes547 in response to Langdell's writings in private law, which had been influenced by the "radical antiformalistic movement in German law science – the Freirechtschule"548. Foreign doctrines can become part of the local jurisprudence, consciously or unconsciously, where they have a force that transcends jurisdictional boundaries. This is true of the concept of proportionality. As Lord Reed observed in Bank Mellat v Her Majesty's Treasury [No 2]549, proportionality, or Verhältnismäßigkeit in German law, had a long history even before it was adopted into German public law. The force of the connecting links vary but, as Lord Reed identified, its parentage in some parts of English law might be loosely traced from Aristotle, through Aquinas, to the eighteenth century Enlightenment including the writings of Blackstone550. Prior to the relatively recent adoption of proportionality by a majority of this Court in McCloy v New South Wales551, its main tenets were said to have been adopted by "virtually every effective system of constitutional justice in the world, with the partial exception of the United States"552. The differences, sometimes subtle and sometimes significant, in the approach taken at each stage of proportionality testing in different jurisdictions are unsurprising given that proportionality testing is applied within different constitutional traditions. But the broad outline of the approach, and the manner by which it structures and exposes judicial reasoning, is common to every jurisdiction that has adopted proportionality testing. Even the United States "exceptionalism", which does not explicitly recognise proportionality testing, has been said to "rely on an unarticulated combination" of the second and third stages 547 Cohen-Eliya and Porat, "American balancing and German proportionality: The historical origins" (2010) 8 International Journal of Constitutional Law 263 at 548 Cohen-Eliya and Porat, "American balancing and German proportionality: The historical origins" (2010) 8 International Journal of Constitutional Law 263 at 549 [2014] AC 700 at 788 [68]. 550 [2014] AC 700 at 788 [68]. 551 (2015) 257 CLR 178 at 194-196 [2]-[4]. 552 Stone Sweet and Mathews, and Global Constitutionalism" (2008) 47 Columbia Journal of Transnational Law 72 at 74. See also Barak, Proportionality: Constitutional Rights and their Limitations "Proportionality Balancing Edelman of proportionality analysis (reasonable necessity and adequacy in the balance)553. So too, as Professor Stone observed of the approach of this Court very shortly after Lange, in this country proportionality testing makes explicit "essentially the process in which [the Court already] engages"554. At each stage the application of proportionality testing in Australia must be tied to the purpose for which it is employed, namely to ensure only that which is necessary for the effective functioning of representative and responsible government manifested in the structure and text of the Constitution, particularly ss 7, 24 and 128, and ss 62 and Proportionality testing has been described in Australia555 and elsewhere556 as a "tool". It is, indeed, a tool. But its nature as a tool does not make it dispensable. It is a tool in the same sense that the Shirt factors557 are a tool for a judge sitting without a jury who is required to justify a conclusion of breach of a duty of care. As a tool, it provides a framework that promotes transparency of reasoning, although it does not purport to supply a mechanical or mathematical approach to the answer. Just as Learned Hand J's "algebraic" formula, B < PL558, has never been applied in a mechanical way to determine breach of a duty of care in Australia, so too Professor Alexy's "Weight Formula"559, which seeks to 553 Jackson, "Thayer, Holmes, Brandeis: Conceptions of Judicial Review, Factfinding, and Proportionality" (2017) 130 Harvard Law Review 2348 at 2372. 554 Stone, "The Limits of Constitutional Text and Structure: Standards of Review and the Freedom of Political Communication" (1999) 23 Melbourne University Law Review 668 at 681. 555 McCloy v New South Wales (2015) 257 CLR 178 at 215 [72]-[73]. 556 McCloy v New South Wales (2015) 257 CLR 178 at 216 [77], referring to Pham v Secretary of State for the Home Department [2015] 1 WLR 1591 at 1622 [96]; [2015] 3 All ER 1015 at 1044, and Lübbe-Wolff, "The Principle of Proportionality in the Case-Law of the German Federal Constitutional Court" (2014) 34 Human Rights Law Journal 12 at 16. 557 Wyong Shire Council v Shirt (1980) 146 CLR 40 at 47-48; [1980] HCA 12. 558 United States v Carroll Towing Co (1947) 159 F 2d 169 at 173: Burden of adequate precautions < Probability of injury multiplied by magnitude of injury. 559 The "most elementary version" of the Weight Formula is Wi,j=Ii / Ij: Alexy, "On Balancing and Subsumption: A Structural Comparison" (2003) 16 Ratio Juris 433 at 444. The "elaborated" formula is Wi,j=Ii*Wi*Ri / Ij*Wj*Rj: Alexy, "Proportionality, constitutional law, and sub-constitutional law: A reply to Aharon Barak" (2018) 16 International Journal of Constitutional Law 871 at 873. Edelman ascribe a numerical figure to incommensurate principles in a particular case to enable an arithmetic comparison of those principles, would not be so applied in an analysis of proportionality in Australia and was not designed to do so. The recognition of proportionality as a structure for decision making is not antithetical to the common law process. The common law development of categories is another significant example of the common law using a tool or framework as a means of structuring and making transparent the process of decision making. The common law categories of contract and torts themselves emerged by "squeezing English rules into models developed elsewhere"560. Like structured proportionality, those categories promote transparent reasoning and identify like cases that are to be treated alike. And, also like structured proportionality, the categories, and development within them, are not immune from further development. As Lord Devlin said in Hedley Byrne & Co Ltd v Heller & Partners Ltd561, "[a]n existing category grows as instances of its application multiply until the time comes when the cell divides". Incremental development within each stage of proportionality testing has occurred and will continue to occur. In different countries, different approaches might reasonably be taken, and are reasonably taken, at each stage of the qualitative proportionality enquiry. But proportionality testing forces judges to confront the issues in a structured way and to explain and justify the approach that is taken. Proportionality testing in Australia provides a graduated lens with increased focus at each stage upon whether a burden upon the implied freedom of political communication is justified. The "suitability" stage asks whether the effect of the law has a rational connection to its purpose. The "reasonable necessity" stage then focuses upon whether the likelihood and expected magnitude of the burden imposed upon the freedom of political communication by the means chosen by Parliament is reasonably necessary to achieve that rationally connected purpose. And the "adequacy in the balance" stage then asks whether the burden upon the freedom of political communication which was imposed by those reasonably necessary means is justified by the purpose of the law. There is a difficult issue, raised but not answered during oral submissions on this appeal, concerning the relevance of changes in facts and circumstances at each stage of proportionality testing. There is no doubt that at each stage of proportionality testing, a court can consider as constitutional facts and circumstances those matters confronting Parliament at the time the challenged law was enacted. Hence, matters such as the likelihood of an effect upon 560 Ibbetson, A Historical Introduction to the Law of Obligations (1999) at 153. 561 [1964] AC 465 at 525. See also Hill v Van Erp (1997) 188 CLR 159 at 189; [1997] HCA 9. Edelman freedom of political communication or the likely magnitude of the effect can, and should, be considered based on the circumstances at the time that the law was enacted. But it is far more controversial for the enquiry to assess suitability, reasonable necessity, or adequacy in the balance by taking into account unforeseeable facts and circumstances. subsequent, potentially radical, changes If such subsequent changes could be taken into account then it might mean that any suitability, reasonable necessity, or adequacy in the balance that once existed could cease to exist. The legislation may be invalid only from a future point in time rather than being void ab initio. Although that approach is not an entirely novel suggestion562, and although some parallels might be drawn with State legislation that is rendered inoperative due to s 109 of the Constitution, strong opposition has been expressed, including quite recently, against the possibility of the validity of legislation waxing and waning with subsequent changes in constitutional facts and circumstances563. Whether subsequent facts and circumstances should be confined to use as evidence only of matters that might have been foreseeable at the time that Parliament legislated need not be resolved in this case. There was no suggestion that the material subsequent to the enactment of the Reproductive Health Act relied upon by various of the parties and interveners reflected any change in underlying facts or circumstances. It suffices in these reasons to consider each stage of proportionality testing by reference to the facts and circumstances, including foreseeable effects, that existed at the time that the legislation was enacted. (1) Suitability The suitability stage of proportionality testing, which asks whether the operation of a law has a rational connection with its purpose, is almost always satisfied since the construct of legislative purpose is based upon a legislature that is assumed to act rationally564. If the expected operation of a law has no rational connection to a hypothesised purpose then that hypothesis could hardly be the purpose of the law passed by a rational legislature. Hence, as has been observed 562 Armstrong v Victoria [No 2] (1957) 99 CLR 28 at 48-49, 73-74; [1957] HCA 55. See also Barak, Proportionality: Constitutional Rights and their Limitations 563 XYZ v The Commonwealth (2006) 227 CLR 532 at 608 [218]; [2006] HCA 25; Murphy v Electoral Commissioner (2016) 261 CLR 28 at 55 [42], 92-93 [196]-[199]; [2016] HCA 36. 564 Unions NSW v New South Wales (2019) 93 ALJR 166 at 198-199 [158]; 363 ALR Edelman of the similar requirement in Canada565 and Israel566, and by one author in the United Kingdom567, this stage has very little work to do in most cases. is given by An extreme instance where a legislature acted irrationally Professor Alexy: a German law that required falconers, persons who hunt with falcons not guns, to undertake the same shooting examination as persons who applied for a general hunting licence568. In addition to identifying extreme cases of irrationality, the suitability stage performs two functions. First, if a law has an illegitimate purpose that is not recognised by the court when considering whether the law pursues a legitimate purpose or purposes, or if the court erroneously accepts a general legislative statement of objects as the purpose of a particular provision that is not related to those objects, then the suitability stage requires the court to confront the lack of any legitimate purpose for the law. Secondly, the suitability stage leads into the second stage, of reasonable necessity, which assesses the means by which the law achieves its rationally connected purposes or objects. Mr Preston submitted that s 9(2) was not rationally connected to a legitimate purpose for similar reasons to those contained in his submissions about the absence of a legitimate purpose. Again, those submissions should not be accepted. Once the legitimate purposes of the protest prohibition in s 9(2) are identified, the effect of the protest prohibition can easily be seen as rationally connected with those purposes. The only concrete example said to illustrate the unsuitability of the operation of the protest prohibition was a submission before the magistrate that there "is no rational reason to stop a silent protest 100 metres from the premises"569. The magistrate rejected this submission on the basis that para (b) of the definition of "prohibited behaviour" in s 9(1) would not extend to silent prayer by two or three people570. However, silent prayer is capable of falling 565 Hogg, Constitutional Law of Canada, 5th ed (2007), vol 2 at 143. 566 Barak, "Proportional Effect: The Israeli Experience" (2007) 57 University of Toronto Law Journal 369 at 372. 567 Yowell, Constitutional Rights and Constitutional Design (2018) at 31. 568 Alexy, "Constitutional Rights and Proportionality" (2014) 22 Revus 51 at 53. 569 Police v Preston and Stallard (unreported, Magistrates Court of Tasmania, 27 July 570 Police v Preston and Stallard (unreported, Magistrates Court of Tasmania, 27 July Edelman within the prohibition even if it would not always amount to a protest within para (b). Silent or quiet action can be a powerful form of protest and political communication. In Levy v Victoria571, Kirby J referred to the communicative power of silent action, including: "[l]ifting a flag in battle, raising a hand against advancing tanks, wearing symbols of dissent, participating in a silent vigil, public prayer and meditation". The protest prohibition was intended to "stop the silent protests outside termination clinics that purport to be a vigil of sorts ... but which, by their very location, are undoubtedly an expression of disapproval"572. The protest prohibition is suitable for its purposes. (2) Reasonably necessary means The second stage of proportionality testing is commonly described as "necessity", but necessity is used here in a loose sense. The question at the second stage is whether there were "alternative, reasonably practicable, means of achieving the same object but which have a less restrictive effect on the freedom"573. The strength of a reasonableness standard will always depend upon the context in which the standard is being imposed574. Here, the context of "reasonably practicable" means of achieving, to the same degree, the legislative objects is that the implied freedom of political communication is limited not merely to matters that will secure the effective operation of the constitutional system of representative and responsible government, but to matters that are also necessary for that operation575. It is also necessary for an effective operation of the constitutional system of representative and responsible government for Parliament to be able to make choices about the best policies to pursue for the implementation of legislation. Parliament is generally in a better position than the courts to assess whether alternative means that have a less restrictive effect on the freedom might not 571 (1997) 189 CLR 579 at 638. 572 Tasmania, House of Assembly, Parliamentary Debates (Hansard), 16 April 2013 at 573 Brown v Tasmania (2017) 261 CLR 328 at 371-372 [139]. See also Unions NSW v New South Wales (2013) 252 CLR 530 at 556 [44]; [2013] HCA 58; McCloy v New South Wales (2015) 257 CLR 178 at 195 [2]. 574 Minister for Immigration and Border Protection v SZVFW (2018) 92 ALJR 713 at 739 [133]; 357 ALR 408 at 437; [2018] HCA 30. 575 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 561. Edelman achieve the legislative purpose as significantly or effectively. As O'Regan J and Cameron A-J powerfully expressed this point in the Constitutional Court of South Africa, "[w]hen a [c]ourt seeks to attribute weight to the factor of 'less restrictive means' it should take care to avoid a result that annihilates the range of choice available to the Legislature"576. This has as much resonance in our constitutional context. Hence, in assessing whether the means adopted was reasonably necessary, it is necessary to ask whether an alternative is "obvious and compelling"577. There are two dimensions involved when considering whether an alternative means of achieving the same object was obvious and compelling. The first is whether the alternative means could reasonably have been expected to have imposed a significantly lesser burden upon the implied freedom of political communication. The second is whether the alternative means could achieve Parliament's purpose to the same or a similar extent. A law will only fail the stage of reasonable necessity if there are alternative means that could reasonably have been expected to have imposed a significantly lesser burden upon the freedom and yet achieved Parliament's purpose to the same or a similar extent. A comparison of the expected burdens upon the implied freedom between the chosen means and the alternative means will require assessing the likelihood and expected magnitude of the burden upon the freedom of political communication imposed by the means chosen by Parliament compared with the alternative postulated means. The likelihood and expected magnitude of the burden can be assessed by reference to the "depth" and "width" of the burden. A burden will be deeper, in the sense of more intensely focused upon the conduct it captures, the more that the law: (i) targets political communication or communication that is closely associated with political communication578; (ii) impairs communication of the message of one side of a debate more than the other; and (iii) punishes or sanctions the conduct. And a burden will be wider, in the sense of capturing more conduct, the less that the restriction on political communication effected by the law is constrained, including by constraints of time, location, or subject matter. 576 S v Manamela 2000 (3) SA 1 (CC) at 41 [95], not dissenting on this point: see at 577 McCloy v New South Wales (2015) 257 CLR 178 at 195 [2], 211 [58], 217 [81]; Brown v Tasmania (2017) 261 CLR 328 at 372 [139], 418-419 [282]. 578 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 169; [1992] HCA 45; Cunliffe v The Commonwealth (1994) 182 CLR 272 at 339; Levy v Victoria (1997) 189 CLR 579 at 618-619; Hogan v Hinch (2011) 243 CLR 506 at 555-556 [95]; [2011] HCA 4; Wotton v Queensland (2012) 246 CLR 1 at 16 [30]; [2012] HCA 2. Edelman The burden imposed by the protest prohibition is deep. It targets protest that has a powerful association with political communication. It does so by imposing criminal consequences of a fine up to 75 penalty units or imprisonment for 12 months or both579. Further, although it is facially neutral in its effect on protest, the human experience described in the Second Reading Speech is one of anti-termination protests outside premises at which terminations are provided: "standing on the street outside a medical facility with the express purpose of dissuading or delaying a woman from accessing a legitimate reproductive health service"580. As the legislative materials rightly assume, history is not replete with examples, in this jurisdiction or others, of non-responsive, pro-termination protests at premises where terminations are provided. The legislative effect will be, and is intended to be, most deeply felt by anti-termination protesters. The burden imposed by the protest prohibition is also wide. The radius of 150 m covers more than 70,000 m2. As the Minister observed in the Second Reading Speech, the access zone might include churches, restaurants and public houses581. The magistrate concluded that the 150 m radius in the Preston appeal extended to a park and a car park582. However, the width of the burden is reduced by the requirement that the protest must be able to be seen or heard by a person accessing, or attempting to access, the premises. One obvious manner in which the width of the burden upon the freedom of political communication could have been significantly lessened would have been by a law that imposed an access zone that was smaller than a 150 m radius (70,000 m2) such as, for example, the approximately 11 m radius (380 m2) used in the Massachusetts law considered in McCullen v Coakley583. However, the reduction of the zone would likely have protected far fewer of those accessing the premises. Even with the area chosen of 70,000 m2, and the likelihood that fact by almost all women would be protected, Magistrate Rheinberger targeted. Her Honour concluded that "[p]rotesters wanting to communicate their political beliefs in relation to terminations of pregnancies in a manner that may target findings of the that some women could be indicate 579 Reproductive Health Act, s 9(2). 580 Tasmania, House of Assembly, Parliamentary Debates (Hansard), 16 April 2013 at 581 Tasmania, House of Assembly, Parliamentary Debates (Hansard), 16 April 2013 at 582 Police v Preston and Stallard (unreported, Magistrates Court of Tasmania, 27 July 583 (2014) 134 S Ct 2518. Edelman women who may be accessing or attempting to access the premises" can still protest outside the access zone, but close enough to allow meaningful opportunity for communication584. In any event, it cannot be said to be obvious or compelling that the purposes of the legislation would be able to be served to the same extent by an access zone with, for example, a radius of 120 m or 130 m. At that degree of specificity such a judgment is peculiarly within the province of Parliament as advised by stakeholders, experts, and committees. As the Minister said in the Second Reading Speech of the Victorian legislation585, which adopted the same radius, that particular distance was chosen "after consultation with a wide range of stakeholders", including health services who had asked for a "much larger zone"586. A second manner in which it might be said that the burden upon the freedom of political communication could have been reduced is by altering the focus of the protest prohibition so that rather than targeting all protests, with their strong association with political communication, the prohibition targeted only communications that are reasonably likely to cause distress or anxiety587. A burden upon political communication will generally be deeper where political communication is specifically targeted, so replacing the broader requirement of protest with a requirement for distress and anxiety might be said to reduce the burden. However, in the course of submissions no example was given of a circumstance in which protest outside premises where terminations are provided would not cause distress or anxiety to a person within the class of vulnerable persons accessing the State of South Australia acknowledged in oral submissions that he could not conceive of any such circumstance. No other party or intervener provided one. The Solicitor-General for the clinic. In summary, a law with the same purpose as the protest prohibition, but that imposed a significantly lesser burden upon the freedom of political communication, could have been enacted. However, despite the depth and width of the burden, it is unlikely that the purposes of the Reproductive Health Act could have been served to the same or a similar extent without imposing a burden 584 Police v Preston and Stallard (unreported, Magistrates Court of Tasmania, 27 July 585 Public Health Act, s 185B(1) (definition of "safe access zone"). 586 Victoria, Legislative Assembly, Parliamentary Debates (Hansard), 22 October 587 See Public Health Act, s 185B(1) (definition of "prohibited behaviour", para (b)). Edelman that was similarly deep and wide. At the least, the possibility that the purposes could be so served by alternative means is neither obvious nor compelling. At first blush, the conclusion that the protest prohibition was reasonably necessary does not sit comfortably with the conclusion reached by the joint judgment in the majority in Brown v Tasmania that the protest prohibition in that case was not reasonably necessary for its purpose588. The Reproductive Health Act denies any meaningful "on-site" protest by excluding a putative protester from a 70,000 m2 area around the relevant premises, and potentially considerably more for protesters who travel without tape measures, in a built-up urban area. Although there was found to be some, undoubtedly limited, scope for a protester to "target" off-site a woman seeking to access premises at which terminations are provided, the same scope existed under the Workplace Protesters Act for a protest to be conducted near forest operations at places that were away from business premises or business access areas589. One potential difference between the cases is the agreed fact in the special case in Brown v Tasmania that "[r]ecent protest activity in Tasmania … has made use of photographs and film to enable dissemination of the activity in the media and the internet, particularly on YouTube, Facebook and Twitter"590. However, it is hard to see how the absence of this evidence of recent media use in the Preston appeal could favour validity when that evidence could only have been obtained in the last five years by contravening a prohibition on recording in the access zone a person accessing or attempting to access the premises591 and a prohibition on publishing or distributing recordings592. In any event, even if some weight were to be put on the absence of online media communication in the more distant period prior to the enactment of the Reproductive Health Act, the exclusion of on-site protest, coupled with the recording prohibition, has the effect of neutering a communicative tool that could have been foreseen in 2013 to become powerful. A reconciliation of the decision in Brown v Tasmania and the decision in the Preston appeal at this stage of proportionality testing lies in the conclusion reached in the joint judgment in Brown v Tasmania about the scope of application of the Workplace Protesters Act. In contrast with my interpretation 588 (2017) 261 CLR 328 at 373 [146]. 589 (2017) 261 CLR 328 at 356-357 [77], 367 [117]. 590 See (2017) 261 CLR 328 at 387 [191], 400 [240]. 591 Reproductive Health Act, s 9(1) (definition of "prohibited behaviour", para (d)). 592 Reproductive Health Act, s 9(4). Edelman of the Workplace Protesters Act593, the joint judgment did not interpret the restriction on protest to be confined to the areas of unchallenged operation of the Forest Management Act 2013 (Tas), which would have eliminated any burden upon the freedom of political communication. Instead, the joint judgment concluded that the restriction went "far beyond" that which was reasonably necessary for the purposes of application of the relevant provisions "to prevent damage and disruption to forest operations", unlike the "substantially less restrictive" measures of the Forest Management Act594. Indeed, if the terms of the Workplace Protesters Act were read literally then they would have restricted protests anywhere within 800,000 ha (8 billion m2) of permanent timber production zone land if any forest operations, such as the clipping of the branches of a tree, took place anywhere within that zone595. The area covered by the Reproductive Health Act is reasonably necessary to fulfil its purposes to the desired extent. By contrast, the interpretation adopted in the joint judgment in Brown v Tasmania of the Workplace Protesters Act, which treated it as applying well beyond those areas where the Forest Manager had denied access to the public in the exercise of powers under s 21, s 22, or s 23 of the Forest Management Act, was considered to impose a substantial burden upon the implied freedom of political communication without any substantial additional furtherance of the statutory purposes. (3) Adequacy in the balance Professor King's monograph on social rights begins by asking: "What is more important, having the ability to preach politics on Hyde Park Corner, or ensuring that we have a fighting chance to live past heart disease or breast cancer?"596 An assessment of whether a law is adequate in the balance involves the metaphor of balancing "the importance of the purpose served by the restrictive measure and the extent of the restriction it imposes on the freedom"597. As Professor King's rhetorical question indicates, a decision by a court that a law is inadequate in the balance, despite the legitimacy of its purpose, could have large consequences. In instances where there are limited means to give effect to the statutory purpose, a conclusion of inadequacy in the balance 593 (2017) 261 CLR 328 at 502-506 [556]-[563]. 594 (2017) 261 CLR 328 at 373 [146]; cf at 423 [291]. 595 (2017) 261 CLR 328 at 481 [489], 494 [533]. 596 King, Judging Social Rights (2012) at 1. 597 McCloy v New South Wales (2015) 257 CLR 178 at 195 [2]. Edelman could mean that Parliament could not legislate at all to achieve a legitimate purpose since even the means that are found, at the second stage, to be reasonably necessary to implement that policy will be invalid. In other words, a decision by a court that a law is inadequate in the balance could, in some instances, mean that implementation of any measure to respond to that public policy concern is prohibited because of the burden it places upon the freedom of political communication. Perhaps due to the significance of this possible consequence, it has been said that some other jurisdictions have effectively abandoned the stage of whether a law is adequate in the balance. This third stage has been treated by some courts as superfluous to the stage of whether the means adopted by the law was reasonably necessary for its purposes. Dr Yowell has observed that the European Court of Human Rights has treated the two as equivalent598, and that over a ten-year period in Canada there was no case in which this limb made any difference to the conclusion reached on the application of the necessity limb599. In Germany, by contrast, the third stage of proportionality testing has been said to have "high relevance"600 because "balancing is constantly practised by the judiciary"601. Professor Grimm, a former Justice of the Federal Constitutional Court of Germany, has argued that a court "risks self-deception when all the value-oriented considerations have been made under the guise of a seemingly value-neutral category"602. However, these value judgments can be highly contested. It is no coincidence that the widely accepted hypothetical example that Professor Grimm gives of balancing rights is extreme. That example is a hypothetical law that permits a thief to be shot to death by police if that is the 598 Yowell, Constitutional Rights and Constitutional Design (2018) at 31, referring to Lithgow v United Kingdom (1986) 8 EHRR 329 at 372 [120]. 599 Yowell, Constitutional Rights and Constitutional Design (2018) at 31, referring to Trakman, Cole-Hamilton and Gatien, "R v Oakes 1986-1997: Back to the Drawing Board" (1998) 36 Osgoode Hall Law Journal 83 at 95, 105. See also Hogg, Constitutional Law of Canada, 5th ed (2007), vol 2 at 152. 600 Grimm, "Proportionality in Canadian and German Constitutional Jurisprudence" (2007) 57 University of Toronto Law Journal 383 at 393. 601 Grimm, "Proportionality in Canadian and German Constitutional Jurisprudence" (2007) 57 University of Toronto Law Journal 383 at 395. 602 Grimm, "Proportionality in Canadian and German Constitutional Jurisprudence" (2007) 57 University of Toronto Law Journal 383 at 395. Edelman only way to protect property603. When balancing rights and freedoms, such a law is suitable in the sense that it has a rational connection with the purpose of protecting property rights. The reasonable necessity stage is satisfied because shooting is allowed only if no other means are available to protect the property rights. But the right to life would not be adequately protected in the balance struck by the law between a person's right to life and the liberty of the police to act so as to protect property604. the The Australian foundations of implied freedom of political communication are inconsistent with an open-ended value assessment at the adequacy in the balance stage. The approach to adequacy in the balance must be highly constrained. This is, in part, because the freedom of political communication arises only as an implication to secure the effective operation of the constitutional system of representative and responsible government. The very representative and responsible government that it secures involves legislative implementation of policy decisions. Thus, it has been said that the stage of adequacy in the balance in Australia requires the judgment to be made "consistently with the limits of the judicial function"605. There are two significant constraints consistent with the permissible constitutional limits of the judicial function that exist to prevent an approach at this stage from operating as a judicial reassessment of the importance of the public policy priorities of the legislature. The first constraint is that the courts cannot "substitute their own assessment for that of the legislative decision-maker"606. This means that the value judgment must respect "the role of the legislature to determine which policies and social benefits ought to be pursued"607. The assessment of the importance of purpose is not the judge's idiosyncratic policy preference. Instead, the first constraint directs attention to the importance that Parliament has given to the purpose. The weight that Parliament has given to legislative purpose is ascertained in the same way that legislative purpose itself is discerned. One factor will be the place of the particular law within the relevant statute and its importance to the furtherance of the statute's purposes. Other factors will be 603 Grimm, "Proportionality in Canadian and German Constitutional Jurisprudence" (2007) 57 University of Toronto Law Journal 383 at 396. 604 Grimm, "Proportionality in Canadian and German Constitutional Jurisprudence" (2007) 57 University of Toronto Law Journal 383 at 396. 605 McCloy v New South Wales (2015) 257 CLR 178 at 195 [2]. 606 McCloy v New South Wales (2015) 257 CLR 178 at 219 [89]. 607 McCloy v New South Wales (2015) 257 CLR 178 at 220 [90]. Edelman the context in which the law was enacted; the legislative facts including the mischief to which Parliament was responding; and the importance expressly assigned to that response in the statute or in extrinsic materials. And it may also be relevant to consider the systemic context in which the law was enacted, including, if Parliament has legislated to protect some right, the importance of the right within the legal system and the extent to which it is embedded in the fabric of the legal system within which Parliament legislates608. The second constraint is that a law will only be inadequate in the balance if it involves gross or manifest lack of balance609 between, on the one hand, the foreseeable magnitude and likelihood of the burden upon freedom of political communication and, on the other hand, the importance of the purpose. That constraint recognises that, in a representative democracy, freedom of political communication is only one facet of formal representative and responsible government. Another facet is the ability of Parliament to make laws for peace, order and good government, including those laws that provide substantive aspects of a free and democratic society and laws that guarantee social human rights610, such as "respect for the inherent dignity of the human person"611. The balancing exercise, constrained in the manner discussed, should not involve rigid categories of review based on either the nature or the extent of the burden upon freedom of political communication. Rather, in each case, when considering the extent to which the freedom of political communication is burdened, the balancing exercise should be "properly attuned to" the nature of the freedom and should reflect "the gravity of the threat" in the particular case to the systemic integrity of the constitutional system of representative and responsible government612. As I have explained in relation to the reasonable necessity stage, when the protest prohibition was enacted, the foreseeable burden on freedom of political communication was both deep and wide. However, the purpose of the protest prohibition was of great importance to Parliament. The protest prohibition served the Reproductive Health Act's integral purposes of, at a lower level of 608 Federal Commissioner of Taxation v Tomaras (2018) 93 ALJR 118 at 137 [101]; 362 ALR 253 at 276-277. 609 Brown v Tasmania (2017) 261 CLR 328 at 422-423 [290]. 610 King, Judging Social Rights (2012) at 187. 611 R v Oakes [1986] 1 SCR 103 at 136. 612 Allan, The Sovereignty of Law (2013) at 247. Edelman generality, ensuring that women have access to termination services in a confidential manner without the threat of harassment. At the higher level of generality, the Reproductive Health Act is concerned with basic issues of public health. These social human rights goals involving respect for the dignity of the human person involve deep-seated issues of public policy within the legal system generally. The extreme importance of the protest prohibition is also apparent from the extrinsic materials preceding the Reproductive Health Act. In those materials it was observed that the previous law had been based on nineteenth century United Kingdom and Irish laws that did not recognise "safe medical practices; community standards; and women as competent and conscientious decision makers"613. The proposed changes were "part of a broader strategy to improve the sexual and reproductive health of all Tasmanians, especially vulnerable populations"614. In the Second Reading Speech for the Reproductive Health Act, the Minister concluded by saying that615: "Today members are, quite simply, being asked to vote for or against women's autonomy, to vote for or against a bill that respects all views on terminations, and to vote for or against a bill that acknowledges women as competent and conscientious decision-makers and recognises that a woman is in the best position to make decisions affecting her future and her health." The burden upon freedom of political communication cannot be said to be in gross and manifest disproportion to the importance of the purpose. Proportionality testing and different constitutional traditions The parties to and interveners in this appeal helpfully referred to a number of cases from overseas jurisdictions. The reasoning in other jurisdictions can sometimes be useful in application of the tests at each of the three stages of proportionality reasoning. But it is necessary, at the very least, to treat those 613 Tasmania, Department of Health and Human Services, Information Paper relating to the Draft Reproductive Health (Access to Terminations) Bill (2013) at 4. 614 Tasmania, Department of Health and Human Services, Information Paper relating to the Draft Reproductive Health (Access to Terminations) Bill (2013) at 17. 615 Tasmania, House of Assembly, Parliamentary Debates (Hansard), 16 April 2013 at Edelman decisions "with some caution"616. Even in relation to very similar circumstances the result might appropriately be different in other countries because of their different legal contexts and traditions. For instance, one contextual difference between Australia and countries such as the United States617, Canada618, and Germany619 is that important law reform in respect of terminations in Australia has occurred by legislation without the driving force of constitutional decisions. But perhaps the most significant difference between different jurisdictions is the different weight that is afforded to particular constitutionally protected values. A good illustration of this is the way that the circumstances in this appeal would have been approached in the United States. The Supreme Court of the United States does not explicitly adopt a proportionality analysis. Instead, its First Amendment jurisprudence has been characterised by one writer, now Justice, as involving "increasingly technical, complex classificatory schemes"620. It has been argued that United States constitutional law developed its "complicated, variegated approach to rights, in part because of its deep ambivalence toward balancing"621. But balancing cannot be avoided, even if freedom of speech is thought generally to be a constitutional trump card over other, incommensurate values: "[e]ven when we are most adamant in our principles, we find ourselves – as rational beings – doing the sort of reasoning and weighing of contrary considerations that a belief in incommensurability is commonly thought to preclude"622. Indeed, Breyer J has said that where "important interests lie on both sides of the constitutional 616 Theophanous v Herald & Weekly Times Ltd (1994) 182 CLR 104 at 125; [1994] HCA 46. See also Coleman v Power (2004) 220 CLR 1 at 48 [88], 75-76 617 Roe v Wade (1973) 410 US 113; Planned Parenthood of Southeastern Pennsylvania v Casey (1992) 505 US 833. 618 R v Morgentaler [1988] 1 SCR 30. 619 Kommers and Miller, The Constitutional Jurisprudence of the Federal Republic of Germany, 3rd ed (2012) at 373-394. 620 Kagan, "Private Speech, Public Purpose: The Role of Governmental Motive in First Amendment Doctrine" (1996) 63 University of Chicago Law Review 413 at 621 Stone Sweet and Mathews, "Proportionality Balancing and Global Constitutionalism" (2008) 47 Columbia Journal of Transnational Law 72 at 164. 622 Waldron, "Fake Incommensurability: A Response to Professor Schauer" (1994) 45 Hastings Law Journal 813 at 824. Edelman equation" then "the Court generally asks whether the statute burdens a protected interest in a way or to an extent that is out of proportion to the statute's salutary effects upon other important governmental interests"623. This approach, which Breyer J said had been applied in various constitutional contexts including freedom of speech cases, is functionally identical to proportionality although it conflates reasonable necessity and adequacy in the balance by taking into account, in one step, "both of the statute's effects upon the competing interests and the existence of any clearly superior less restrictive alternative"624. Even if the approach taken by the Supreme Court of the United States were not able to be characterised as akin to structured proportionality, the balancing process that it undertakes involves affording far greater weight to the constitutional guarantee of freedom of speech in the First Amendment625 than Australian law would afford to the implied freedom of political communication. The circumstances of the Preston appeal are an excellent illustration of the different weighting that is afforded in Australia to the freedom of political communication, which is limited to what is necessary for the effective operation of the constitutional system of representative and responsible government626. In contrast with the result in this case, it is almost beyond argument that the relevant provisions of the Reproductive Health Act would be invalid on the present approach taken by the United States Supreme Court. Prior to 2014 in the United States, judicial injunctions that responded to particular physical circumstances and were capable of judicial expansion or contraction when those circumstances changed had been upheld by the Supreme Court of the United States627. None of those cases is comparable with the circumstances of a general legislative provision that extends to peaceful protests. In one Supreme Court decision, a limited injunction had been amended after it did not adequately respond to specific instances at one clinic of blocking public access and physical abuse628. In another the injunction responded to 623 District of Columbia v Heller (2008) 554 US 570 at 689-690. See also United States v Alvarez (2012) 567 US 709 at 730. 624 District of Columbia v Heller (2008) 554 US 570 at 690. 625 Which reads, relevantly: "Congress shall make no law ... abridging the freedom of speech". 626 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 561. 627 Madsen v Women's Health Center Inc (1994) 512 US 753; Schenck v Pro-Choice Network of Western New York (1997) 519 US 357. 628 Madsen v Women's Health Center Inc (1994) 512 US 753 at 758-759. Edelman particular large-scale blockades impairing access to four medical clinics. The police were unable to prevent those blockades. The conduct included grabbing, pushing, shoving, yelling, and spitting at women who tried to access the clinic's services629. In both cases, a majority of the Supreme Court upheld part of the injunctions but struck down certain aspects of them630. Also prior to 2014, a law had been upheld by a slim majority of the United States Supreme Court631, where the law had only imposed particular restrictions upon knowingly approaching within 8 ft (2.5 m) of people for the purpose of engaging in sidewalk counselling without their consent, inside an area of 100 ft (30 m) of the entrance to a health care facility632. Even that decision to uphold the very limited restriction on freedom of speech, which imposed no fixed no-access zone, was said by some commentators to be "inexplicable on standard free-speech grounds"633 and a "candidate[] for most blatantly erroneous [decision] … slam-dunk wrong"634. It was also said that if the majority had treated the law as content-based and applied strict scrutiny to it, the law would have been invalid635. The only truly comparable decision of the Supreme Court of the United States concerning access zones around premises at which terminations are provided involved a Massachusetts law that was held to be invalid. In that case, McCullen v Coakley636, the law imposed an access zone with a 35 ft (11 m) radius 629 Schenck v Pro-Choice Network of Western New York (1997) 519 US 357 at 630 Madsen v Women's Health Center Inc (1994) 512 US 753 at 776; Schenck v Pro-Choice Network of Western New York (1997) 519 US 357 at 377, 380. 631 Hill v Colorado (2000) 530 US 703 at 725-726, 730. 632 Hill v Colorado (2000) 530 US 703 at 707-708. 633 McConnell, in Sullivan, "Sex, Money, and Groups: Free Speech and Association Decisions in the October 1999 Term" (2001) 28 Pepperdine Law Review 723 at 747, quoted in McCullen v Coakley (2014) 134 S Ct 2518 at 2545 fn 4. 634 Tribe, in Sullivan, "Sex, Money, and Groups: Free Speech and Association Decisions in the October 1999 Term" (2001) 28 Pepperdine Law Review 723 at 750, quoted in McCullen v Coakley (2014) 134 S Ct 2518 at 2545-2546 fn 4. 635 Sullivan, "Sex, Money, and Groups: Free Speech and Association Decisions in the October 1999 Term" (2001) 28 Pepperdine Law Review 723 at 736. 636 (2014) 134 S Ct 2518. Edelman covering public ways or sidewalks around the entrances and driveways of the clinics. The area was required to be clearly marked637. The restriction applied only during business hours of the clinic. The restriction was, according to a majority of the Court, content neutral638. Nevertheless, the legislation was unanimously held to be contrary to the First Amendment. Although the access zone involved only an 11 m radius, there was evidence that the petitioner was able to speak to "far fewer people" because she was unable to "distinguish patients from passersby outside the Boston clinic in time to initiate a conversation before they enter the buffer zone"639. the the approach The contrast between the invalid Massachusetts law and the vastly broader, but valid, Reproductive Health Act in Tasmania demonstrates the stark difference between the manner in which freedom of speech is approached in the implied freedom of political United States and communication in Australia. The access zone under the Reproductive Health Act covers 70,000 m2 of area. By contrast, the Massachusetts law covered 380 m2. The 70,000 m2 access zone created by the Reproductive Health Act is not required to be marked, with the effect that its boundaries would not be clearly known to a protester. By contrast, the Massachusetts law required marking. The content of the prohibited communication in the protest prohibition is specifically targeted towards protests in relation to termination. It is not content neutral in the sense in which that concept was applied by the majority of the Supreme Court in McCullen v Coakley; it is concerned with "listeners' reactions to speech" so it would be subject to strict scrutiny in the United States640. By contrast, a majority of the Supreme Court held that the Massachusetts law was content neutral. And yet, whilst the Massachusetts law was unanimously held by the Supreme Court of the United States to be inconsistent with the First Amendment and invalid, the Reproductive Health Act is unanimously held by this Court to be consistent with our constitutional tradition and valid. Conclusion: the orders on each appeal Each of the appeals, so far as they have been removed into this Court, must be dismissed. 637 (2014) 134 S Ct 2518 at 2526. 638 (2014) 134 S Ct 2518 at 2534. 639 (2014) 134 S Ct 2518 at 2535. 640 (2014) 134 S Ct 2518 at 2531-2532.

HIGH COURT OF AUSTRALIA APPELLANT AND COLLECTOR OF CUSTOMS & ORS RESPONDENTS Thiess v Collector of Customs [2014] HCA 12 2 April 2014 ORDER Appeal dismissed with costs. On appeal from the Supreme Court of Queensland Representation A J H Morris QC with P L Somers for the appellant (instructed by Walsh the Commonwealth with J T Gleeson SC, Solicitor-General of G J D del Villar and J K Edwards for the first and second respondents (instructed by Australian Government Solicitor) No appearance for the third to sixth respondents Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Thiess v Collector of Customs Customs and excise – Recovery of sum paid to Customs as duty payable – Where appellant's customs agent transmitted incorrect information in computer import entry for imported yacht – Where customs duty overpaid due to mistaken belief as to weight of yacht – Where appellant discovered mistake outside statutorily prescribed period for recovery and sought to recover monies paid – Whether s 167(4) of Customs Act 1901 (Cth) operates as a bar to recovery of customs duty paid where no dispute under s 167(1). Statutes – Interpretation – Whether action available for recovery of customs duty paid outside prescribed statutory circumstances. Words and phrases – "customs duty", "demand", "dispute", "no action shall lie for the recovery of any sum", "payment under protest". Customs Act 1901 (Cth), ss 163, 167. FRENCH CJ, HAYNE, KIEFEL, GAGELER AND KEANE JJ. This appeal concerns the construction of s 167(4) of the Customs Act 1901 (Cth) ("the Act"), the opening words of which provide that "[n]o action shall lie for the recovery of any sum paid to the Customs as the duty payable in respect of any goods". Section 167(4) operates to bar all actions for the recovery of sums paid to the Customs as duty payable in respect of goods, irrespective of whether a dispute as to the amount or rate of duty payable in respect of the goods had arisen at the time of payment, subject only to two exceptions. The exceptions are actions under s 167(2), commenced within times specified in s 167(4), and actions to enforce rights or to compel exercise of powers under s 163. The Act Goods imported into Australia become subject to the control of the "Customs" – at times relevant to this appeal, the Australian Customs Service – at the time of their importation1. The owner must enter the goods for home consumption or for warehousing2. Goods to be entered for home consumption remain subject to the control of Customs until delivered into home consumption in accordance with an authority given by Customs to take them into home consumption3. The process of entering goods for home consumption begins with a communication of information to Customs, which at times relevant to this appeal took the form of an "import entry"4. An import entry could be either a documentary import entry5 or a computer import entry6. A documentary import entry would be given by the owner in an approved form7. It was to include "such 1 Section 30. 2 Section 68. 3 Sections 30, 68 and 71C. At relevant times ss 30, 68 and 71B. 4 Section 71A(1). 5 Section 71A(1)(c). 6 Section 71A(1)(d). 7 Section 71A(2) and s 71K. Hayne information as the approved form requires"8. A computer import entry was transmitted by means of computer facilities known as the "COMPILE computer system" by a registered COMPILE user, who could be the owner or a person acting on the owner's behalf9. It was to contain "such information as is set out in an approved statement relating to that communication"10. Where an import entry had been given or transmitted to Customs, Customs was to give or transmit an "import entry advice"11. If the owner gave a documentary import entry, the import entry advice was to be given to the owner in documentary form12. If a registered COMPILE user transmitted a computer import entry, the import entry advice was to be transmitted to that user by means of the COMPILE computer system13. The import entry advice could, in either case, include a statement to the effect that the goods were cleared for home consumption14. An authority to take the goods into home consumption was then given by Customs where an import entry advice had been given or transmitted and where "a payment is made of any duty, GST ... or other charge or fee payable at the time of entry of, or in respect of, the goods covered by the import entry advice"15. If the import entry advice was given to the owner in documentary form, the authority was to be given to the owner in writing16. If the import entry advice was transmitted to a registered COMPILE user by means of the COMPILE 8 Section 71K(b). 9 Section 71A(3) and s 71L. 10 Section 71L(1)(c). 11 Section 71B(1). 12 Section 71B(2). 13 Section 71B(3). 14 Section 71B(2)(b)(i) and (3)(c)(i). 15 Section 71B(4)(a) and (b). 16 Section 71B(4)(c). Hayne computer system, the authority was to be given in a message transmitted to that user by the same means17. Customs duty, imposed under a Customs Tariff (relevantly the Customs Tariff Act 1995 (Cth)) on goods imported into Australia, is payable at the time of entry of the goods for home consumption18. GST, where also imposed, is payable on the amount of that duty19. Customs duty constitutes a debt to the Commonwealth charged on the goods, payable by the owner, and recoverable at any time in any court of competent jurisdiction by proceedings in the name of "the Collector"20. Functions of the Collector are exercised by the Chief Executive Officer and other designated officers of Customs21. Section 167 of the Act, to which it will be necessary to return, provides in part: If any dispute arises as to the amount or rate of duty payable in respect of any goods, or as to the liability of any goods to duty, under any Customs Tariff, or under any Customs Tariff or Customs Tariff alteration proposed in the Parliament (not being duty imposed under the Customs Tariff (Anti-Dumping) Act 1975), the owner of the goods may pay under protest the sum demanded by the Collector as the duty payable in respect of the goods, and thereupon the sum so paid shall, as against the owner of the goods, be deemed to be the proper duty payable in respect of the goods, unless the contrary is determined in an action brought in pursuance of this section. 17 Section 71B(4)(d). 18 Section 132AA(1). 19 Sections 13-5 and 13-20(2)(c) of the A New Tax System (Goods and Services Tax) Act 1999 (Cth). 20 Section 165. At relevant times s 153. 21 Section 8. Hayne The owner may, within the times limited in this section, bring an action against the Collector, in any Commonwealth or State Court of competent jurisdiction, for the recovery of the whole or any part of the sum so paid. (4) No action shall lie for the recovery of any sum paid to the Customs as the duty payable in respect of any goods, unless the payment is made under protest in pursuance of this section and the action is commenced within the following times: In case the sum is paid as the duty payable under any Customs Tariff, within 6 months after the date of the payment; or In case the sum is paid as the duty payable under a Customs Tariff or Customs Tariff alteration proposed the Parliament, within 6 months after the Act, by which the Customs Tariff or Customs Tariff alteration proposed in the Parliament is made law, is assented to. (5) Nothing in this section shall affect any rights or powers under section 163." Sub-sections (3) and (3A) of s 167, which need not be reproduced, set out exhaustively when a payment is taken to be made under protest. Section 163 of the Act – to which s 167(5) refers – provides, amongst other things, that refunds, rebates and remissions of duty may be made in such circumstances, and subject to such conditions and restrictions, as are prescribed22. Where prescribed circumstances exist and prescribed conditions and restrictions are met, s 163 creates rights to payment enforceable by actions in 22 Section 163(1)(b). Hayne debt against the Commonwealth23, as well as enlivening powers to make payment which can be subject to administrative review24. The circumstances prescribed for the purposes of s 163 include where "duty has been paid through manifest error of fact or patent misconception of the law"25. The conditions and restrictions prescribed for a refund in those circumstances include that an application is made for the refund within a Facts Mr Thiess owned a yacht which he imported into Australia in 2004 and which he intended to enter for home consumption. His customs agent, a registered COMPILE user, transmitted a computer import entry on his behalf. The customs agent mistakenly believed that the gross weight of the yacht was 108 tonnes. In fact, the gross weight was 160 tonnes. Acting on that mistaken belief, the customs agent ascribed to the yacht the wrong tariff classification. The COMPILE computer system automatically used the classification ascribed by the agent to calculate that the customs duty payable on the entry of the yacht would be in an amount of $494,472 and that an additional amount of $49,447 would be payable as GST and to display those amounts to the customs agent. The amounts so calculated and displayed, totalling $543,919, were in consequence of that automatic calculation included within the "Total Amount Payable" shown in the computer import entry which the agent then transmitted. The true position was that no customs duty was payable, and consequently that no additional GST was payable. Yachts not exceeding 150 tonnes attracted duty; yachts exceeding 150 tonnes were duty free27. 23 The Commonwealth v SCI Operations Pty Ltd (1998) 192 CLR 285 at 305 [40], 313 [65]; [1998] HCA 20. 24 Section 273GA(1)(haaa). 25 Regulation 126(1)(e) of the Customs Regulations 1926 (Cth). 26 Regulations 127(1) and 128A(4). At relevant times regs 127(1) and 128A(5). 27 Item 8903.92 of Sched 3 to the Customs Tariff Act 1995 (Cth). Hayne Customs transmitted an import entry advice to the agent. The import entry advice included a statement to the effect that the yacht was cleared for home consumption subject only to quarantine clearance. The customs agent, as agent for Mr Thiess, then paid to Customs by electronic transfer a total amount which included the mistakenly calculated amount of $543,919. Customs then transmitted a message to the agent giving authority to take the yacht into home consumption. The yacht was delivered into home consumption in accordance with that authority. Proceedings Mr Thiess discovered the mistake only after the expiration of the prescribed period for making an application for a refund under s 163 of the Act. He brought proceedings in the Supreme Court of Queensland against parties which included the Collector and the Commonwealth. No relevant distinction having been drawn between the Collector and the Commonwealth, it is convenient to refer to those parties together as "the Commonwealth". Mr Thiess' claim against the Commonwealth in the proceedings was to recover the amount of $543,919. He framed that claim principally as one for money had and received, relying on the money having been paid under a mistake of fact, and in the alternative as one for restitution in equity or for equitable compensation. Questions of law were reserved on the pleadings for the consideration of the Court of Appeal. The Court of Appeal determined in the course of answering those questions that the Commonwealth had lawful defences to Mr Thiess' claim: s 167(4) of the Act provided a defence in so far as the claim was to recover the amount of $494,472 paid as customs duty; s 36 of the Taxation Administration Act 1953 (Cth) provided a defence in so far as the claim was to recover the additional amount of $49,447 paid as GST28. An argument put on behalf of Mr Thiess before the Court of Appeal was that s 167(4) of the Act had no application to his claim to recover the amount paid as customs duty, for the reason that no "demand" had been made and hence no "dispute" had arisen within the meaning of s 167(1) at the time of payment29. Fraser JA, with whom de Jersey CJ and Muir JA agreed, rejected that argument 28 Thiess v Collector of Customs [2014] 1 Qd R 81. 29 Thiess v Collector of Customs [2014] 1 Qd R 81 at 89 [24]. Hayne on its minor premise. His Honour characterised the automatic calculation of the amount payable as customs duty by the COMPILE computer system as a demand by Customs for payment of that amount30. His Honour emphasised that Mr Thiess could have paid that amount under protest had he been alert to his own interests31. Appeal In this appeal by special leave from the decision of the Court of Appeal, counsel for Mr Thiess embraced an argument that the opening words of s 167(4) of the Act speak only to the statutory cause of action created by s 167(2). He again argued that s 167(4) can have no application absent a dispute within the meaning of s 167(1). He again argued that no dispute had arisen. We reject the argument on its major premise. We therefore reach the same result as the Court of Appeal, without having occasion to address whether it can properly be concluded that a dispute within the meaning of s 167(1) had crystallised at the time of payment32. Mr Thiess, through his counsel, conceded that he cannot recover the amount paid as GST if he is prevented by s 167(4) from recovering the amount paid as customs duty. That concession makes it unnecessary for the purpose of determining the appeal to give separate consideration to recovery of the amount paid as GST. Construction of s 167(4) Statutory construction involves attribution of meaning to statutory text. As recently reiterated33: 30 Thiess v Collector of Customs [2014] 1 Qd R 81 at 90-91 [28]. 31 Thiess v Collector of Customs [2014] 1 Qd R 81 at 92 [31]. 32 Cf Parks Holdings Pty Ltd v Chief Executive Officer of Customs (2004) 141 FCR 165 at 179 [54], 180 [58]. 33 Federal Commissioner of Taxation v Consolidated Media Holdings Ltd (2012) 87 ALJR 98 at 107 [39]; 293 ALR 257 at 268-269; [2012] HCA 55 (footnote omitted). Hayne "'This Court has stated on many occasions that the task of statutory construction must begin with a consideration of the [statutory] text'. So must the task of statutory construction end. The statutory text must be considered in its context. That context includes legislative history and extrinsic materials. Understanding context has utility if, and in so far as, it assists in fixing the meaning of the statutory text." Objective discernment of statutory purpose is integral to contextual construction. The requirement of s 15AA of the Acts Interpretation Act 1901 (Cth) that "the interpretation that would best achieve the purpose or object of [an] Act (whether or not that purpose or object is expressly stated …) is to be preferred to each other interpretation" is in that respect a particular statutory reflection of a general systemic principle. For34: "it is one of the surest indexes of a mature and developed jurisprudence not to make a fortress out of the dictionary; but to remember that statutes always have some purpose or object to accomplish, whose sympathetic and imaginative discovery is the surest guide to their meaning." The relevant text of s 167(4) of the Act is emphatic: "[n]o action shall lie for the recovery of any sum paid to the Customs as the duty payable in respect of any goods". Two qualifications are apparent. First, s 167(2) permits the bringing, within the times limited by s 167(4), of a statutory action for the recovery of the whole or any part of a sum paid under protest pursuant to s 167(1). It is that statutory action to which s 167(4) goes on to refer when it adds the express qualification "unless the payment is made under protest in pursuance of this section and the action is commenced within the following times". Second, s 167(5) adds the express qualification that nothing in s 167 affects any rights or powers under s 163. Section 167(4) therefore says nothing to affect any action to enforce any right to a refund, rebate or remission of duty which arises under s 163. In particular, s 167(4) does not bar an action in debt to enforce the right which arises under s 163 to recover a sum paid through manifest error of fact or patent misconception of law, where application is made within the 34 Cabell v Markham 148 F 2d 737 at 739 (1945), quoted in Residual Assco Group Ltd v Spalvins (2000) 202 CLR 629 at 644 [27]; [2000] HCA 33. Hayne prescribed period for a refund of that sum, and where other prescribed conditions of, and restrictions on, the making of that refund are met. The scheme of the Act is inconsistent with the implication of any further qualification. The scheme, as already explained: gives to Customs control over goods imported into Australia; requires goods intended to be entered for home consumption to be the subject of a documentary import entry or a computer import entry followed by an import entry advice; and makes payment of duty a condition of Customs relinquishing control by giving an authority to take the goods into home consumption. The function of s 167 within that scheme is to provide, by s 167(1), a mechanism for payment under protest, so as to allow goods to be entered for home consumption in circumstances where the owner and Customs are in dispute as to the amount of duty payable in respect of those goods. The comprehensive nature of that mechanism is demonstrated by the exhaustive operation of s 167(3) and (3A) to explain when, if at all, a payment is to be taken to have been made under protest. The correct amount of duty payable is then able to be determined after entry, in a statutory action under s 167(2). By barring any other recovery action, s 167(4) enhances the operation of that scheme. It creates an incentive for the owner to be vigilant in the process of entering goods for home consumption to identify what the owner considers to be the duty payable. It creates an incentive for the owner then to abide by the statutory mechanism of payment under protest and subsequent statutory action in the event of a difference emerging in that process between what the owner considers to be the correct duty payable and what Customs considers to be the duty payable. legislative design. Legislative history confirms Section 167, that including s 167(4), is substantially in the form in which it was substituted by an amendment to the Act in December 191035. Section 167 in its original form had provided, in the event of a dispute as to the amount or rate of duty, for the owner to be entitled to take delivery of the goods after depositing the amount demanded by the Collector. The amount deposited was then deemed to be the proper duty unless the contrary was determined in an action commenced by the owner against the Collector within a specified time. The amount deposited appears in practice 35 Customs Act 1910 (Cth). Hayne to have been held in a trust fund and not to have been treated as revenue pending the commencement and determination of that action36. Whether an action was available at common law for the recovery of an amount paid as customs duty outside the operation of s 167 as originally enacted was in 1904 seen as an open question by the original Comptroller-General of Customs37. In September 1910, individual members of the High Court gave different answers in Sargood Bros v The Commonwealth38. Griffith CJ refrained from determining whether the remedy given by the section was exclusive39. O'Connor J40 and Higgins J41 held that a common law action was available. Isaacs J in dissent held that a common law action was not available42. Recovery in an action at common law by an owner who could have raised a dispute, Isaacs J went on to say, "would throw the finances of the country into utter confusion"43: "After several years questions might be raised which, on some suddenly discovered interpretation of a taxing Act, whether internal revenue or Customs, would unexpectedly require the return of enormous sums of money, and quite disorganize the public treasury." His Honour continued: "Indeed, it reduces sec 167 to a dead letter, depriving it of all efficacy whatsoever. No merchant, so long as such a position prevails, would be 36 Opinions of Attorneys-General of the Commonwealth of Australia, Volume 1: 1901-14, (1981) at 280, Opinion No 233. 37 Wollaston, Customs Law and Regulations, (1904) at 104. 38 (1910) 11 CLR 258; [1910] HCA 45. 39 (1910) 11 CLR 258 at 266. 40 (1910) 11 CLR 258 at 276-277. 41 (1910) 11 CLR 258 at 308-309. 42 (1910) 11 CLR 258 at 301-303. 43 (1910) 11 CLR 258 at 303. Hayne foolish enough to raise a dispute and act under a section which requires him to sue within six months, when by deliberately preserving silence he can sue within at least six years." Those remarks of Isaacs J are to be understood against the background that customs duty accounted at that time for more than half of all Commonwealth revenue44. The opening words of s 167(4), in the form in which s 167 was substituted less than three months later, can be seen to have been an immediate prophylactic statutory response to the spectre of widespread fiscal confusion raised by Isaacs J. Those words as then enacted operated in combination with s 167(5) to ensure that, apart from the statutory action for recovery newly created by s 167(2), no action was to lie for the recovery of any sum paid to Customs as the duty payable in respect of any goods other than an action to enforce a right or to compel the exercise of a power under s 163. The preservation by s 167(5) of an action to enforce a right or to compel the exercise of a power under s 163 operated immediately to ameliorate the potentially harsh operation of s 167(4) and continues to do so. Significantly, at the time of the substitution of s 167 in 1910, s 163(2) provided that "[w]henever duty has been paid through manifest error of fact or patent misconception of the law … a refund rebate or remission of the duty as the case may require shall be made in manner prescribed". It is not irrelevant to the facts in the present case to observe that one illustration of duty having been "paid through manifest error of fact", which had been published as early as 1904, was of goods having been entered at a weight which was subsequently found to have been incorrect45. After 1910, s 163 continued itself to provide for payment of a refund in those circumstances until repealed and re-enacted in 1971, with effect from 1974, to provide, as it does now, for refunds to occur only in prescribed circumstances46. The same circumstances of duty having been paid through manifest error of fact 44 Commonwealth Bureau of Census and Statistics, Official Year Book of the Commonwealth of Australia, No 4 (1911) at 804. 45 Wollaston, Customs Law and Regulations, (1904) at 103. 46 Customs Act 1971 (Cth). Hayne or patent misconception of the law were prescribed in 197447 and have continuously been prescribed since then. Counsel for Mr Thiess sought to gain support for the proposition that s 167(4) can have no application absent a dispute within the meaning of s 167(1) from the decisions in Comptroller-General of Customs v Kawasaki Motors Pty Ltd (No 2)48 and in Malika Holdings Pty Ltd v Stretton49. Kawasaki Motors decided that s 167(4) operates at least to bar an action outside s 167(2) where there is a dispute within the meaning of s 167(1); whether s 167(4) has a broader operation was specifically left open50. Malika Holdings decided only that s 167 has no application to an action by the Collector to recover unpaid duty. To the extent reasons for judgment in Malika Holdings touch on the construction of s 167(4), they are consistent with the construction explained in these reasons for judgment51. Finally, we note that the construction of s 167(4) explained in these reasons for judgment is consistent with that implicitly adopted in the reasoning of at least a majority in The Commonwealth v SCI Operations Pty Ltd52. Orders The appeal is dismissed with costs. 47 Customs Regulations Amendment 1974 (Cth) (SR No 112 of 1974). 48 (1991) 32 FCR 243. 49 (2001) 204 CLR 290; [2001] HCA 14. 50 (1991) 32 FCR 243 at 264. 51 (2001) 204 CLR 290 at 306 [53], 319 [92], 319-320 [95]. 52 (1998) 192 CLR 285 at 304 [37], 310-311 [60].

HIGH COURT OF AUSTRALIA BARNETT AND APPELLANT SECRETARY, DEPARTMENT OF COMMUNITIES AND JUSTICE RESPONDENT Barnett v Secretary, Department of Communities and Justice [2023] HCA 7 Date of Hearing: 10 February 2023 Date of Order: 10 February 2023 Date of Publication of Reasons: 15 March 2023 ORDER The grant of special leave in this matter be revoked. On appeal from the Federal Circuit and Family Court of Australia (Division 1) Representation B R Kremer with A T-H Lim for the appellant (instructed by Hague Convention Legal Practice) M A Gillies SC with M R M Barnett SC for the respondent (instructed by DCJ Legal) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Barnett v Secretary, Department of Communities and Justice Family law – Children – International child abduction – Where child removed from Ireland to Australia by appellant mother without consent of father – Where father granted declaration of guardianship in Ireland – Where respondent sought orders in Australia for return of child to Ireland under Family Law (Child Abduction Convention) Regulations 1986 (Cth) – Where no transcript or reasons for making Irish declaration provided to Australian courts – Whether bare declaration created issue estoppel preventing mother from submitting father did not have rights of custody under Regulations at date of child's removal from Ireland. High Court – Special leave to appeal – Where special leave granted in respect of finding of issue estoppel based on bare declaration by Irish court, absent transcript or reasons for decision – Where transcript belatedly provided to High Court prior to appeal hearing – Where factual foundation for grant of special leave removed – Whether continuation of appeal contrary to interests of administration of justice – Whether special leave should be revoked. Words and phrases – "bare declaration", "issue estoppel", "privity", "revocation of special leave to appeal", "rights of custody", "special leave to appeal". Convention on the Civil Aspects of International Child Abduction [1987] ATS 2. Family Law (Child Abduction Convention) Regulations 1986 (Cth), regs 2(1), 4, Guardianship of Infants Act 1964 (Ir), s 6F. KIEFEL CJ, GAGELER, GORDON, GLEESON AND JAGOT JJ. On 10 February 2023 we unanimously revoked the grant of special leave to appeal in this matter. These are our reasons for the revocation of that grant. Procedural history The appellant is the mother of a child born in the Republic of Ireland on 19 May 2019. On 30 August 2020, the mother removed the child from Ireland to Australia without the consent of the child's father. The respondent is the Central Authority of the State of New South Wales for the purposes of the Family Law (Child Abduction Convention) Regulations 1986 (Cth)1 ("the Regulations"). At the father's request2, the respondent applied to the Family Court of Australia (as it was then known) pursuant to reg 14 of the Regulations for orders seeking the return of the child to Ireland and ancillary orders. The Regulations give effect to Australia's obligations under the Convention on the Civil Aspects of International Child Abduction (1980)3. The Convention, to which both Australia and Ireland are signatories, provides a framework for the prompt return of a child where there has been a wrongful removal of the child from her or his country of habitual residence. After a contested hearing, on 25 June 2021, being satisfied that the removal of the child from Ireland was wrongful in accordance with the relevant provision4, the Family Court was required to, and made, orders for the child's return to The mother appealed against the orders of the Family Court. On 18 February 2022, the Full Court of the Federal Circuit and Family Court of 1 Made under Family Law Act 1975 (Cth), s 111B. See Regulations, regs 9 and 13. As a result of the father's request, the respondent was the responsible Central Authority for the purposes of reg 14: see reg 2(1), definition of "responsible Central Authority". [1987] ATS 2. 4 Regulations, reg 16(1)(c) and (1A). Secretary, NSW Department of Communities and Justice & Barnett [2021] FamCA Gordon Gleeson Jagot Australia (Division 1) dismissed the mother's appeal6. The Full Court rejected the mother's argument that the father did not have, or had not been proved to have, rights of custody7 at the date of the child's removal from Ireland. The Full Court relied on a declaration made by the District Court of the Dublin Metropolitan District ("the Irish court") on 12 April 2021 that the father was a guardian of the child within the meaning of s 6F of the Guardianship of Infants Act 1964 (Ir) ("the Declaration"). As the Declaration must have been based on the cohabitation of the mother and father, which ceased on 30 August 2020 when the mother returned to Australia with the child, the Full Court considered the primary judge was correct to conclude that it followed from the Declaration that the father had rights of custody in respect of the child before 30 August 2020, and that the mother (as a party to the proceeding in the Irish court) was therefore estopped from asserting to the contrary. On 21 October 2022, the mother was granted special leave to appeal to this Court from the judgment of the Full Court. The application for special leave to appeal involved a single ground alleging error by the Full Court in holding that the Declaration gave rise to the issue estoppel. The mother alleged that it did not follow from the bare terms of the Declaration, either as a matter of fact or by the operation of Irish law, that the father had rights of custody as at 30 August 2020. Consistently with this, the mother's written submissions in support of the application for special leave to appeal said that there were "no reasons of the [Irish court] that allowed" a conclusion to be drawn about the father's status as at 30 August 2020. The key consideration underlying the grant of special leave was the issue estoppel based on the bare Declaration, in circumstances where the Irish court's reasons for making the Declaration were neither available nor admitted into evidence before the courts below. Revocation of the grant of special leave On 20 January 2023, the respondent filed an application for revocation of the grant of special leave. The transcript of the Irish court's reasons for judgment in respect of the making of the Declaration was admitted into evidence at the 6 Barnett & Secretary, Department of Communities and Justice [2022] FedCFamC1A 7 Regulations, reg 4. Gordon Gleeson Jagot hearing of the revocation application8. The transcript was annexed to an affidavit, relied upon by the respondent, which explained that: (a) the respondent was informed of the Declaration on 15 April 2021 and received a copy of the order making the Declaration on 30 April 2021; (b) on 6 May 2021, an officer of the respondent asked the Commonwealth Central Authority for a copy of any written judgment or transcript of oral reasons given by the Irish court for the Declaration; (c) the respondent was informed that oral reasons were given and that it would be necessary to apply to the Irish court for a copy of the transcript; (d) for reasons which are not apparent to this Court, any such application was left to the father's lawyers to pursue, without success; and (e) in the meantime, the hearings before the Family Court and the Full Court were completed, without the benefit of the reasons for judgment of the Irish court. The unsatisfactory nature of this state of affairs need hardly be explained. The (belated) further efforts of the respondent to obtain the reasons for judgment after this Court granted special leave resulted in the respondent receiving a transcript of the oral reasons for judgment of the Irish court on 11 January 2023. The transcript shows that, on 12 April 2021, the Irish court made findings that the father and mother: "cohabited from the 23rd of May 2019 until the 23rd of May 2020 at the very least and that they lived together during that period in an intimate and a committed relationship. Accordingly ... [the father] has satisfied the criteria for a declaration that he is, by operation of law, a guardian of [the child] from the 23rd of May 2020, the time when guardianship commenced". The transcript also discloses that the mother and her Irish legal representatives were in attendance when the oral reasons for judgment were given and the Declaration made9. Given these reasons for the Declaration, the foundation for the grant of special leave has been removed. The transcript discloses that the Irish court found, as an essential element of its reasoning, that the father's guardianship commenced 8 Reg 29(6) of the Regulations provides for the admissibility of an order or a decision of a competent authority in relation to the custody of a child. 9 The hearing for the delivery of the reasons for judgment and the making of the Declaration occurred online. Gordon Gleeson Jagot from 23 May 2020. From that, it necessarily follows that the father had "rights of custody" in respect of the child at 30 August 2020. The submission made on behalf of the mother, that objection could be taken to the admissibility of the transcript if sought to be adduced on the substantive appeal to this Court10, misses the point. So, too, do the mother's attempts to argue that the conclusion by the courts below that the father had rights of custody in respect of the child was wrong on other bases (such as the absence of privity, or on procedural grounds), as those submissions wrongly assume that the grant of special leave was based on something more than the fact of the finding of the issue estoppel from the bare terms of the Declaration. It would have been contrary to the interests of the administration of justice to permit the appeal to proceed on the false premise of the unavailability of the Irish court's reasons, when those reasons validate the inferences drawn by both courts below from the terms of the Declaration. That approach would have exacerbated the substantive and procedural anomalies below in which the hearings proceeded without: (a) the respondent, as the moving party, ensuring the reasons for judgment of the Irish court were in evidence; and (b) the mother, as a party present when the Irish court gave its reasons for judgment and made the Declaration, having made the courts below aware of the true position. Another factor which we considered in revoking the grant of special leave to appeal is that the mother has appealed against the Declaration made by the Irish court. The only matter preventing that appeal from being heard, apparently, was the mother's unresolved appeal to this Court. We considered that all issues concerning the jurisdiction of the Irish court and the operation of Irish law are best resolved as part of the appeal in Ireland. We should also record that, at the hearing of the application for the revocation of special leave, the mother sought to tender an expert opinion from an Irish lawyer. The narrow basis on which special leave was granted explains why we refused to admit that evidence as evidence in response to the application for revocation. The expert opinion was directed to matters of Irish law and could not 10 Mickelberg v The Queen (1989) 167 CLR 259 at 266, 271; Eastman v The Queen (2000) 203 CLR 1 at 12-13 [16]-[17], 26 [78], 34-35 [108]-[111], 63 [190], 76 [232], Gordon Gleeson Jagot alter the removal of the factual foundation for the grant of special leave. Accordingly, the evidence was inadmissible11. Some further matters Regrettably, this is not the first time that courts below have been left without critical material in matters arising under the Regulations. We reiterate what was identified by this Court in MW v Director-General, Department of Community Services12, namely, that the speedy disposition of applications under the Convention is not to be achieved "upon a patently imperfect record" or at the expense of other incidents of the due administration of justice, including the identification of the issues truly open to dispute between the parties through the making of proper and reasonable inquiries and the gathering of evidence13. As in MW, the courts below in this matter were left without evidence on a question of fact that was apparently known to both the mother and the father and should have been ascertained by the respondent, namely, the facts found by the Irish court which were essential to the making of the Declaration. In that regard, the respondent's evidence on the revocation application should have explained why it did not take more active steps to ensure that the transcript was available in the courts below to narrow the issues between the parties. It is unsatisfactory that counsel for the respondent was unable to assist this Court with an answer to that question. Regulation 29(2) of the Regulations makes provision for the admissibility as evidence of any document given in support of an application for a return order for a child made under, relevantly, reg 14. There are many avenues that the respondent could have explored to obtain the transcript of the Irish court's oral reasons for judgment once it was known that the mother disputed the father's rights of custody as at 30 August 2020. The respondent could have ascertained whether the Irish Central Authority could obtain the transcript or whether the respondent or the Commonwealth Central Authority could obtain a copy of the transcript from the Irish court without the father's assistance. The respondent could have asked for any notes of the oral reasons made by the father's Irish lawyers, the mother's Irish lawyers or by either the mother or 11 Evidence Act 1995 (Cth), s 56(2). (2008) 82 ALJR 629 at 632-633 [3], 639-640 [48]-[50]; 244 ALR 205 at 207, 217- 13 Regulations, reg 15(2). Gordon Gleeson Jagot the father. The respondent could have ascertained whether the father or one of his Irish lawyers was able to give evidence about the oral reasons. The respondent could also have made inquiries about the materials on which the mother's appeal in Ireland against the making of the Declaration is to be argued and, specifically, whether they include any evidence of the content of the oral reasons which might have been provided earlier to the Australian courts. This also suggests that good practice warrants consideration by the respondent of the joinder of the requesting parent as a proper party to proceedings seeking the return of a child to a foreign jurisdiction14. The failure to do so in the present case meant that: (a) the father had weak grounds on which to seek a copy of the transcript of the oral reasons for judgment from the Irish court; and (b) the mother could seek to press in this Court, without having done so on the special leave application, that the respondent and father were not privies, so that the respondent could not rely on the issue estoppel against the mother. If the respondent had joined the father below, the mother could not have sought to include the privity argument as part of the appeal. Order It is for these reasons that, on 10 February 2023, we ordered that the grant of special leave in this matter be revoked. 14 Even if not a "necessary party" under r 3.01 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) ("the 2021 Rules") (or r 6.02 of the Family Law Rules 2004 (Cth) ("the 2004 Rules"), in force before the primary judge), the father had a sufficient interest to justify joinder under r 3.03 of the 2021 Rules (or rr 6.03 or 6.05 of the 2004 Rules); cf Family Procedure Rules 2010 (UK), r 12.3.

HIGH COURT OF AUSTRALIA GAX AND APPELLANT THE QUEEN RESPONDENT GAX v The Queen [2017] HCA 25 21 June 2017 ORDER Appeal allowed. Set aside the order of the Court of Appeal of the Supreme Court of Queensland made on 22 July 2016 and in its place order that the appeal to that Court be allowed, the appellant's conviction be quashed and a judgment and verdict of acquittal be entered. On appeal from the Supreme Court of Queensland Representation M J Copley QC for the appellant (instructed by Macrossan & Amiet Solicitors) M R Byrne QC with S J Farnden for the respondent (instructed by Director of Public Prosecutions (Qld)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS GAX v The Queen Criminal law – Appeal – Verdict unreasonable or insupportable having regard to evidence – Where appellant convicted on one count of aggravated indecent dealing with child and acquitted on two counts of aggravated indecent dealing with same child – Where appellant appealed conviction as unreasonable and inconsistent with acquittals – Whether Court of Appeal made independent assessment of sufficiency and quality of evidence in determining whether verdict unreasonable – Whether verdict unreasonable. Words and phrases – "unreasonable verdict". BELL, GAGELER, NETTLE AND GORDON JJ. The appellant was convicted before the District Court of Queensland (Smith DCJ and jury) of aggravated indecent dealing with a child, his lineal descendant1. The offence was the third count of three counts charged in the indictment. The appellant was acquitted of the first two counts, which charged aggravated acts of indecent dealing with the same child. The appellant was sentenced to 12 months' imprisonment, the term to be suspended after five months2. The appellant appealed against his conviction to the Court of Appeal of the Supreme Court of Queensland (McMurdo P, Morrison JA and Atkinson J)3, contending that the verdict was unreasonable and that it was inconsistent with the verdicts of "not guilty" returned on counts one and two. By majority, the Court of Appeal rejected each ground. McMurdo P, in dissent, held that the evidence did not suffice to prove the appellant's guilt beyond reasonable doubt. On 16 December 2016 French CJ, Bell and Keane JJ granted the appellant special leave to appeal. The Court of Appeal majority's conclusion that the verdict on count three was not inconsistent with the verdicts on counts one and two is not challenged. In this Court, the appellant contends that the Court of Appeal majority failed to make an independent assessment of the sufficiency and quality of the evidence in determining that it was open to the jury to convict (ground one) and that their Honours erred in concluding that the verdict was not unreasonable (ground two). As will appear, there is a somewhat arid quality to the controversy concerning the sufficiency of the Court of Appeal majority's analysis of the unreasonable verdict ground in circumstances in which their Honours' conclusion that the evidence was capable of supporting it cannot stand. To explain why that is so, it is necessary to refer in some detail to the evidence adduced in support of count three. The evidence The complainant is the appellant's natural daughter. She was aged just under 13 years at the date of the offence, which was particularised as occurring between 11 and 14 July 2003. Her first complaint concerning the offence was made a little over a decade later. On or about 2 November 2013, the complainant 1 Criminal Code (Q), s 210. 2 The suspension of the sentence was conditioned on the appellant not committing any offence punishable by imprisonment within a period of two years. 3 R v GAX [2016] QCA 189. Bell NettleJ attended at a police station and gave an account of the matters that formed the basis of the offences charged in the indictment. The complainant's evidence adduced in chief, without objection, was that the appellant had "started touching" her from when she was aged six, seven or eight years. The touching had been "unappropriate", but at the time the complainant thought that it was normal. The offence charged in count three was the last occasion of inappropriate touching. The complainant identified this offence as the time "where he was caught". It occurred in the complainant's bedroom, which she shared with her sister, DML. It was the only occasion on which the complainant recalled an incident of inappropriate touching in her bedroom. The material part of the complainant's evidence-in-chief, critical to the determination of the appeal, is set out below: "[M]y mum came in asking – she had pulled the sheets up before – sorry. I used to sleep in the room with my sister. We were in the same room, and she was asleep in her bed. The light had been turned on and Mum had come in. She pulled the blanket up after seeing Dad just hopping out of the bed. Q: So I'll - - - ? A: When she pulled the sheets, my underwear were down at my ankles. Q: How did your underwear get down to your ankles? A: Time, I didn't know. All I knew was my Dad had just hopped off the bed. Q: What was he doing while he was on the bed? A: Well, I was asleep before and ended up finding out what happened, but - - - Q: No, I don't want you to tell us what you ended up finding out? A: No. I was like - - - Q: What do you remember? A: When I was laying there, I could feel hands down near where my underwear were – were supposed to be. Bell NettleJ Q: Well, what was happening with the hands? A: I can't say. Sorry, I can't say. I don't remember. Q: So you felt the hands down around where your underwear was supposed to be. Whereabouts? Can you say in particular where the hands were? A: His fingers were near my vagina, and I don't remember what was happening. All I remember is his fingers were down there until the light – until we realised that someone was coming down the hallway. Q: How long were his fingers down there? A: I would not be able to recall." The complainant explained that when she referred to her mother pulling the sheets up she meant that her mother had pulled the bed covering off her. It will have been observed that the complainant said DML was asleep in her bed at the time. DML's account was that she had been out with her mother and brothers on a car trip and on their return she and her mother had gone to the bedroom that she shared with the complainant. When they entered the bedroom she saw the appellant in bed with the complainant. The mother asked the appellant what he was doing a few times and he did not reply. He was either asleep or pretending to be asleep. The complainant got out of the bed and ran out of the room crying. The complainant's undies were "right down" and her nightie or shirt was "above her boobs". The complainant's mother, GJC, gave evidence dating the incident by reference to an entry in a calendar. She had placed an asterisk next to Saturday 12 July 2003, signifying that the incident had occurred on the previous night, a Friday. She said the asterisk marked the day after "I caught [the appellant] in bed with [the complainant]". GJC explained that on the evening of Friday 11 July she had gone out to buy takeaway food. She could not recall whether DML accompanied her or stayed at home. On her return with the dinner, GJC called out to the complainant, and when there was no response, GJC went to look for her. She turned the light on in the complainant's bedroom and saw "[the appellant] cuddling up with [the complainant] in the bed and the sheets were pulled right up". The complainant was snuggled up to the appellant with her eyes "scrunched up". The appellant appeared to be asleep. GJC announced "dinner's here" and pulled back the covers. She observed that the complainant's knickers were folded down about an inch. The complainant was wearing a pink singlet Bell NettleJ and pink knickers. The singlet was pulled down in a normal fashion. GJC tried to wake the complainant and she yelled at the appellant and pulled him out of bed. She saw that he was wearing boxer shorts and a t-shirt. The complainant remained in bed with her eyes scrunched up. The complainant acknowledged that she had regularly wet the bed up until high school. She accepted that she would often take off her underwear and leave them in the bed or on the floor by the bed after an episode of bed-wetting. The complainant's recall of events was generally poor. In examination-in-chief she volunteered cross-examination she acknowledged that her memory was unreliable and that this was a problem that she had experienced most of her life. She also agreed that she had been "easily led" at school and that she was a person who would "believe what anyone told [her] at that time". just all mumbled up right now". that "[m]y mind's GJC described the complainant as having learning difficulties at school and as having been assessed as in the "borderline or below-average range of intellectual function". She agreed that the complainant had had difficulties with long-term memory throughout her life. GJC acknowledged that not quite three weeks after she made her statement to the police about this matter she commenced proceedings in the Federal Circuit Court of Australia against the appellant seeking a division of property and spousal maintenance. She also acknowledged that in an affidavit filed in those proceedings she had described the complainant's allegations as "very unexpected and very shocking". The particulars of the offence charged in count three furnished by the prosecution before the trial were that "[t]he [appellant] touched the complainant on the vagina". At the conclusion of the prosecution case, counsel submitted that there was no evidence to support the case of touching on the vagina. The prosecution successfully applied to amend the particulars to assert that the appellant touched the complainant "on or near the vagina". The appellant gave evidence and denied that he had inappropriately touched the complainant on any occasion. He denied that there had been any occasion when he had been in the complainant's bed with her. The Court of Appeal Atkinson J, in the leading majority judgment, reviewed the evidence in support of count three. This was done in the course of addressing the inconsistent verdicts ground. In this context, her Honour observed that the Bell NettleJ complainant's evidence of the offence charged in count three had been supported in important ways by DML and GJC4. The complainant's evidence of the offences charged in counts one and two was by contrast "vague and uncertain"5. The verdict on count three could be explained in light of the evidence of DML and GJC, who had found the appellant in "a compromising position" in bed with the complainant, whose underwear was "down". Any suggestion that the appellant had been checking to see if the complainant had wet the bed by lying in it was "plainly ridiculous". The inconsistencies between the evidence of the complainant, DML and GJC were "relatively minor" and tended against any suggestion of collusion6. The appellant identifies the following two paragraphs as the critical passage in Atkinson J's reasons: "[49] ... The different quality of the evidence for count three and the support given by the evidence of two other witnesses provides a rational basis for convicting on count three notwithstanding the acquittal on the other two counts. It also shows that the verdict of the jury should not be set aside on the ground that it was unreasonable or could not be supported having regard to the evidence. [50] True it is, as the President has observed, that in later years the complainant enjoyed a cordial, even close, relationship with her father but that in no way suggests that the count on which the appellant was convicted did not occur but that it was rather, as she and her mother testified, the last occasion on which he molested her." McMurdo P, in dissent, would have allowed the appeal. Her Honour accepted that the jury was entitled to reject the appellant's evidence and to find that the appellant had been discovered in the complainant's bed on the evening of Friday 11 July 20037. Nonetheless, her Honour observed, the issue was whether the prosecution had established beyond reasonable doubt that the appellant had 4 R v GAX [2016] QCA 189 at [43]. 5 R v GAX [2016] QCA 189 at [35]. 6 R v GAX [2016] QCA 189 at [43]-[44]. 7 R v GAX [2016] QCA 189 at [11]. Bell NettleJ indecently touched the complainant on that occasion. Her Honour noted that the only evidence of indecent touching came from the complainant. Her Honour considered that particular caution was needed before accepting the complainant's evidence given the lengthy delay in reporting the matter; the timing of the complaint proximate the mother's commencement of property and maintenance proceedings; the complainant's admittedly unreliable long-term memory and her acceptance of being prone to suggestion8. A further matter that McMurdo P took into account was her understanding that in the initial complaint to the police the complainant had said that the appellant had put his fingers in her vagina on the occasion charged in count three9. In this respect, McMurdo P's understanding of the evidence was in error. The complainant told the police that the appellant had put his fingers in her vagina on occasions, but she did not say that he had done so on this occasion. This error does not appear to have been material to McMurdo P's ultimate conclusion. That conclusion was that the real possibility that the complainant's account was a reconstruction could not be excluded beyond reasonable doubt10. For completeness, it should be noted that McMurdo P considered that the inconsistencies between the complainant's evidence and the evidence of GJC and DML were more than minor: GJC said the complainant's underwear was folded down an inch, whereas the complainant and DML described them as down near the complainant's ankles and "right down" respectively; GJC saw nothing out of the ordinary about the complainant's singlet, whereas DML said it was above the complainant's "boobs"; and on the complainant's account, DML was asleep in her bed at the time11. The parties' submissions The principles to be applied by the appellate court in determining an appeal against conviction on the ground that the verdict is unreasonable12 were 8 R v GAX [2016] QCA 189 at [17]. 9 R v GAX [2016] QCA 189 at [6]. 10 R v GAX [2016] QCA 189 at [19]. 11 R v GAX [2016] QCA 189 at [18]. 12 Criminal Code (Q), s 668E. Bell NettleJ not in contention in the Court of Appeal or in this Court13. They were correctly summarised by Atkinson J at the commencement of her reasons: the court was required to review the whole of the evidence to determine whether it was open to hold that the appellant's guilt had been proved beyond reasonable doubt14. The argument advanced in support of the appellant's first ground is that the only analysis of the capacity of the evidence to support the verdict is in the concluding sentence of [49] and [50]. The appellant adopts McMurdo P's analysis of the deficiencies in the evidence and complains of the Court of Appeal majority's failure to address those deficiencies. The appellant's argument in support of his second ground is that it was not open to the jury to be satisfied to the criminal standard that the complainant was touched on or near her vagina. This is because the only evidence of the touching was the complainant's evidence extracted above, which, it is said, does not admit of satisfaction beyond reasonable doubt that she had any actual recollection of being touched. The respondent's contention is that the appellant's analysis of Atkinson J's reasons has an air of artificiality to it. Her Honour is said to have fairly reviewed the whole of the evidence relevant to count three in the course of dealing with the inconsistent verdicts ground. The respondent submits that there was a substantial measure of overlap between the two grounds before the Court of Appeal. The complainant's evidence that "[h]is fingers were near my vagina, and I don't remember what was happening. All I remember is his fingers were down there" sufficed to establish an indecent touching on or near her vagina. This evidence, it is said, was materially supported by GJC's and DML's evidence that the complainant's underwear was "disorganised". The respondent submits that the possibility of an innocent explanation for the appellant's presence in the bed was excluded beyond reasonable doubt. The criticisms of the treatment of the unreasonable verdict ground It may be accepted that Atkinson J's consideration of the unreasonableness ground was not confined to the concluding sentence of [49] and [50]. As the respondent submits, her Honour's rejection at an earlier point in her reasons of the possibility that the appellant was checking to see if the complainant had wet the bed and her conclusion that inconsistencies in the evidence were "relatively 13 The principles are collected in SKA v The Queen (2011) 243 CLR 400 at 409 [22]- [24] per French CJ, Gummow and Kiefel JJ; [2011] HCA 13. 14 R v GAX [2016] QCA 189 at [25] citing SKA v The Queen (2011) 243 CLR 400 at Bell NettleJ minor" were evaluative assessments of the evidence considered as a whole. The respondent is also right to point to a measure of overlap in the task of determining whether the verdict of guilty was inconsistent with the verdicts of acquittal and, if it was not, whether it was supported by the evidence. It remains that the tasks are distinct. In the course of dealing with the inconsistent verdicts ground Atkinson J said that the jury had been entitled to accept that the risk of reconstruction had been avoided because the prosecutor directed the complainant to only give evidence of what she remembered15. It will be recalled that the complainant's initial response to the question of how her underwear had come to be around her ankles was "[t]ime, I didn't know. All I knew was my Dad had just hopped off the bed" and that her next answer was "I was asleep before and ended up finding out what happened". At this point the prosecutor told the complainant not to give evidence of what she had found out but to state what she remembered. Following this instruction the complainant stated "I could feel hands down near where my underwear were - were supposed to be" and "[h]is fingers were near my vagina, and I don't remember what was happening". The last-mentioned assertion was the evidence on which proof of count three depended. Accepting that the assertion "his fingers were near my vagina" was in law evidence of an indecent dealing within the amended particulars, the issue raised by the unreasonable verdict ground was one of fact16. Determination of this ground turned on the Court of Appeal's own assessment of whether it was open to the jury to be satisfied of the appellant's guilt to the criminal standard17. Atkinson J's view, that the jury had been entitled to reject the possibility of reconstruction, was a matter which her Honour took into account in identifying a rational explanation for the differing verdicts. It is less clear that her Honour was expressing an independently formed conclusion about the capacity of the evidence to exclude the possibility of reconstruction. There is force to the contention that the reasons do not disclose her Honour's own assessment of the sufficiency and quality of the evidence of the particularised touching. 15 R v GAX [2016] QCA 189 at [44]. 16 M v The Queen (1994) 181 CLR 487 at 492; [1994] HCA 63. 17 M v The Queen (1994) 181 CLR 487 at 492-493 per Mason CJ, Deane, Dawson and Toohey JJ; SKA v The Queen (2011) 243 CLR 400 at 405-406 [11]-[14] per French CJ, Gummow and Kiefel JJ. Bell NettleJ The sufficiency of the evidence This was a short trial at which the evidence was taken in under two days. In the circumstances, consistently with the parties' agreement on the hearing in this Court, any deficiency in the Court of Appeal majority's analysis of the reasonableness of the verdict should not lead to a remitter. The interests of justice favour this Court itself determining that question. The appellant's contention below that the prosecution failed to exclude the possibility of collusion, and allied suggestion of collusion associated with GJC's application to the Federal Circuit Court for the division of property and spousal maintenance, can be immediately put aside. The suggestion that the complainant, DML and GJC colluded to falsely accuse the appellant of impropriety in order to bolster GJC's claim in the Federal Circuit Court was not put to any of them. Moreover, given that the appellant was charged with these offences on 4 November 2013 and released on bail conditioned that he not return to live at the family home, the circumstance that his wife commenced proceedings in late November 2013 to obtain maintenance is hardly remarkable. It should be accepted, as McMurdo P did, that the prosecution established that the appellant was discovered in bed with the complainant on the occasion charged in count three. It is a circumstance that fairly attracts suspicion. It remains that it was necessary to prove an act of indecent touching on or near the complainant's vagina. The complainant's evidence allowed the inference that there had been such a touching. This is not to say, however, that it was open to draw that inference beyond reasonable doubt. The complainant's answers to the questions of how her underwear came to be down to her ankles and what the appellant was doing while he was on the bed were, respectively: "[t]ime, I didn't know. All I knew was my Dad had just hopped off the bed" and "[w]ell, I was asleep before and ended up finding out what happened". If true, they pointed to her further answers on this topic as a reconstruction. Her inability to give any details of the touching is consistent with that possibility. So, too, is GJC's evidence that the complainant appeared to be asleep when she pulled the bed covering off. Finally, there is the issue of the state of the complainant's underwear at the time of the incident. The marked inconsistencies between DML's account of the incident as a whole and the complainant's and GJC's accounts lessen the capacity of DML's evidence, that the complainant's underwear was "right down", to support acceptance of the complainant's evidence of the state of her underwear. GJC's rather precise recall that when she pulled off the bed coverings, the complainant's underwear was folded down about an inch is again suggestive of Bell NettleJ reconstruction: when the complainant was pressed to describe what she remembered, she said, "I could feel hands down near where my underwear were - were supposed to be". This is not a case in which the jury's advantage in seeing and hearing the evidence can provide an answer to the challenge to the sufficiency of the evidence to support the verdict. McMurdo P was right to conclude that the real possibility that the complainant's evidence was a reconstruction and not an actual memory could not be excluded beyond reasonable doubt18. Orders For these reasons there should be the following orders: Appeal allowed. Set aside the order of the Court of Appeal of the Supreme Court of Queensland made on 22 July 2016 and in its place order that the appeal to that Court be allowed, the appellant's conviction be quashed and a judgment and verdict of acquittal be entered. 18 R v GAX [2016] QCA 189 at [19]. Edelman EDELMAN J. I agree with the reasons given in the joint judgment for why the verdict of the jury was unreasonable in the sense that it was not open to the jury to conclude beyond reasonable doubt that the appellant was guilty of the offence charged in count three. I therefore agree that the appeal should be allowed on the second ground of appeal. I also agree with the orders proposed in the joint judgment. In light of this conclusion, it is unnecessary to consider the first ground of appeal, which is that the majority of the Court of Appeal of the Supreme Court of Queensland failed to make an independent assessment of the sufficiency and quality of the evidence in determining that it was open to the jury to convict the appellant. This ground of appeal, often summarised as one which complains of inadequate reasons, refers to the obligation of the appellate court to make an independent assessment of the capacity of the evidence to support the verdict19. As the joint judgment observes, the first ground of appeal is arid. It serves no purpose in circumstances where both parties accept that there is no basis to remit this matter to the Court of Appeal. However, as I differ from the conclusion of the joint judgment about the force of the submissions on the first ground of appeal, it is necessary to make two related observations about the first ground and to explain the reasons why, if it were necessary to decide, I would dismiss that ground of appeal. First, there is no single, correct way in which reasons must be written. The content and detail of reasons "will vary according to the nature of the jurisdiction which the court is exercising and the particular matter the subject of the decision"20. In the context of appellate consideration of the reasonableness of a conviction where the court is required to show an independent assessment of the sufficiency and quality of the evidence, the content and detail of the reasons may depend on matters such as the length of the trial, and the issues which assumed importance during the trial. The content and detail of reasons may also be affected by the focus of submissions on the appeal, particularly if the parties are represented by able counsel. Thus, if submissions are made on a matter which is important or critical to the appellant's case and this is not referred to in the reasons then it might be inferred that the court overlooked the evidence or failed to give consideration to it21. 19 Morris v The Queen (1987) 163 CLR 454 at 473; [1987] HCA 50; SKA v The Queen (2011) 243 CLR 400 at 406 [14]; [2011] HCA 13; BCM v The Queen (2013) 88 ALJR 101 at 106 [31]; 303 ALR 387 at 392; [2013] HCA 48. 20 Wainohu v New South Wales (2011) 243 CLR 181 at 215 [56]; [2011] HCA 24. 21 Beale v Government Insurance Office of NSW (1997) 48 NSWLR 430 at 443. Edelman Secondly, the submissions made to an appellate court in an appeal concerning the unreasonableness of a verdict can assume importance where appellate reasons descend into the detail of a case but are nevertheless said not to reflect an independent assessment of the capacity of the evidence to support the verdict. The obligation to provide adequate reasons does not require a court of appeal to write reasons which disclose every aspect of the thought process which leads to the court's conclusion independently of the manner in which the case was presented. Submissions provide context to the reasons given by a court. For instance, even on this highly focused appeal, despite a minute analysis of a single page of transcript of the complainant's evidence, neither party referred to later cross-examination of the complainant where it was put to her that the incident did not happen at all, or her response, perhaps emphatically although one cannot tell from the transcript, that the incident "did happen". In light of the manner in which the appeal was presented, and the focus before this Court upon the evidence about what occurred during the incident, that passage did not assume significance. In this case, the reasons of the majority of the Court of Appeal did not, as the appellant submitted, deal only with the question of whether the verdict was unreasonable in two sentences contained in two paragraphs late in the judgment. Rather, the reasons of the majority (Atkinson J, with whom Morrison JA agreed) dealt, in a compendious way, with both the unreasonableness ground of appeal and the ground concerning inconsistent verdicts. It seems that this joint treatment was the reason for the appellant's submission that the majority had only considered the unreasonableness ground in two paragraphs. In her Honour's reasons, Atkinson J recognised that it was necessary to consider the whole of the evidence in relation to count three in order to assess the unreasonableness ground22. Her Honour summarised the complainant's evidence in relation to the count in question23. She set out the evidence of the complainant which assumed critical importance on this appeal, including summarising and quoting, respectively, the passages in which the complainant said in response to questions about how her underwear came to be around her ankles that "[t]ime, I didn't know. All I knew was my Dad had just hopped off the bed" and "I was asleep before and ended up finding out what happened"24. Her Honour emphasised, in a discussion about that evidence, the exchange which followed immediately afterwards where the prosecutor told the complainant only to relate what she remembered25. Her Honour later said, in what must have been one of 22 R v GAX [2016] QCA 189 at [25]. 23 R v GAX [2016] QCA 189 at [27]-[28]. 24 R v GAX [2016] QCA 189 at [27], [29]. 25 R v GAX [2016] QCA 189 at [29]. Edelman the reasons why she considered that the verdict was not unreasonable, that "the risk of reconstruction was avoided by the prosecutor directing the complainant to only give evidence of what she remembered"26. the complainant's underwear, requires As the joint judgment of the other members of this Court explains, the complainant's evidence about not knowing how her underwear came to be at her ankles, and being asleep and ending up finding out what had happened, assessed in light of GJC's evidence and DML's evidence including inconsistencies about the state of the conclusion of unreasonableness of the jury's verdict27. This is so notwithstanding the direction given by the prosecutor. However, the appellant did not allege any inadequacy in the reasons of the majority of the Court of Appeal in assessing the extent of the potential for reconstruction notwithstanding the instruction by the prosecutor. Such an allegation, if it had been made, would have invited the response that it removed the distinction between an allegation of error in reasons given and an allegation of inadequate reasons. It might have required consideration of the submissions, written or oral, that were made before the Court of Appeal. No such submissions were provided to this Court. Rather, as I have explained, the appellant's submission was that the majority of the Court of Appeal addressed the unreasonableness ground in only two sentences, within two paragraphs at the conclusion of the reasons, which were said to be completely divorced from the remainder of the reasoning. That submission must be rejected. If it were necessary to decide, I would dismiss the first ground of appeal. 26 R v GAX [2016] QCA 189 at [44].

HIGH COURT OF AUSTRALIA McHUGH ACJ, NT POWER GENERATION PTY LTD APPELLANT AND POWER AND WATER AUTHORITY & ANOR RESPONDENTS NT Power Generation Pty Ltd v Power and Water Authority [2004] HCA 48 6 October 2004 ORDER The appeal is allowed. The orders of the Full Federal Court made on 2 October 2002 are set aside. In lieu of the orders of the Full Federal Court made on 2 October 2002: the appeal to the Full Federal Court is allowed; and the respondents are to pay the costs of the appeal to the Full Federal Court. The respondents are to pay the costs of the appeal to this Court. The matter is remitted to Mansfield J for determination of the claim against the second respondent and consideration of the quantum of damages, costs of the trial, and the form of other relief. On appeal from the Federal Court of Australia Representation: A J L Bannon SC with A A Henskens for the appellant (instructed by Colin Biggers and Paisley) B C Oslington QC with L G Foster SC and A I Tonking for the respondents (instructed by Noonans Lawyers) Interveners: R J Meadows QC, Solicitor-General for the State of Western Australia with R M Mitchell intervening on behalf of the Attorney-General for the State of Western Australia (instructed by Crown Solicitor for the State of Western Australia) C J Kourakis QC, Solicitor-General for the State of South Australia with G F Cox intervening on behalf of the Attorney-General for the State of South Australia (instructed by Crown Solicitor for the State of South Australia) N J Williams SC with L McCallum intervening on behalf of the Australian Competition and Consumer Commission (instructed by Australian Government Solicitor) S J Gageler SC with N L Sharp intervening on behalf of the Attorney-General for the State of New South Wales (instructed by Crown Solicitor for the State of New South Wales) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS NT Power Generation Pty Ltd v Power and Water Authority Trade practices – Market definition – Substantial degree of market power – Where statutory authority had a monopoly in the markets for electricity transmission and distribution services and for electricity supply – Where authority owned the transmission and distribution infrastructure – Where no transactions occurred in the transmission and distribution services market – Whether authority's control of the infrastructure gave it market power in both markets – Trade Practices Act 1974 (Cth), ss 46(1), 46(4)(c). Trade practices – Misuse of market power – Taking advantage of market power – Proscribed purpose – Whether statutory authority's refusal of access to its infrastructure involved taking advantage of its market power or only of its proprietary rights – Whether refusal was due to a "direction" from the Minister – whether Minister's purpose in giving direction meant authority's refusal was not for a proscribed purpose – Whether authority's regulatory role meant refusal was not for a proscribed purpose – Trade Practices Act 1974 (Cth), s 46(1) – Power and Water Authority Act (NT), s 16. Crown – Immunity – Crown in right of the Northern Territory – Carrying on a business under the Trade Practices Act 1974 (Cth) – Exceptions – Where statutory authority had a monopoly in the markets for electricity transmission and distribution services and for electricity supply – Where authority owned the transmission and distribution infrastructure – Whether authority's exclusive use of the infrastructure was part of carrying on a business – Whether refusal of access to infrastructure was merely refusal of a "licence" and thus not part of carrying on a business – Trade Practices Act 1974 (Cth), ss 2B, 2C(1)(b). Crown – Immunity – Crown in right of the Northern Territory – "Emanation of the Crown" – Where statutory authority established by the Territory Government was the sole beneficial owner of a trading corporation – Where corporation incorporated under general enactment for the incorporation of companies rather than specific statute – Where corporation acquired for specific Government purpose – Whether corporation was an "emanation of the Crown". Crown – Immunity – Crown in right of the Northern Territory – "Derivative Crown immunity" – Where statutory authority established by the Territory Government was the sole beneficial owner of a trading corporation – Where corporation entered into contracts with third parties – Where financial interests of the Government potentially prejudiced by preventing enforcement of those contracts under the Trade Practices Act 1974 (Cth) – Where no legal or proprietary interests of the Government affected – Whether corporation could claim "derivative Crown immunity". Practice and procedure – Pleadings – Where points made in original pleadings but not relied on and no evidence called at trial – Whether points can be taken on appeal. Words and phrases – "carries on a business", "market power", "take advantage of", "derivative Crown immunity", "emanation of the Crown", "direction", "licence". Competition Policy Reform Act 1995 (Cth), s 89. Competition Policy Reform (Northern Territory) Act (NT), ss 14, 15. Power and Water Authority Act (NT), s 16. Trade Practices Act 1974 (Cth), ss 2B(1), 2C(1)(b), 4, 46(1), 46(4)(c), Schedule, Pt 1, cl 46. McHUGH ACJ, GUMMOW, CALLINAN AND HEYDON JJ. The appellant, NT Power Generation Pty Ltd ("NT Power"), generated electrical power at a plant which it owned. It decided to sell power to consumers within the Northern Territory. It could not sell power without access to the existing electricity transmission and distribution infrastructure in and around Darwin and Katherine. That infrastructure was owned by the first respondent, Power and Water Authority ("PAWA"). PAWA, a body corporate constituted under s 4 of the Power and Water Authority Act (NT)1 ("the PAWA Act"), was subject to the directions of the Minister for Essential Services for the Northern Territory (s 16). It operated a vertically integrated electricity enterprise. It generated electricity or purchased electricity generated by others; it transported that electricity from generation sites to distribution points via transmission equipment; it then transported it from distribution points to the customers via distribution equipment, and charged the customers. NT Power requested that PAWA supply the electricity transmission and distribution infrastructure services needed for its plan to sell electricity to consumers in competition with PAWA. Though there was no safety, technical or other problem preventing PAWA from acceding to that request, on 26 August 1998 PAWA rejected it. Thereafter PAWA maintained that stand. While the field of legal controversy arising from that rejection was broader in the courts below, in this appeal three principal questions arise about the construction and application of the Trade Practices Act 1974 (Cth) ("the Act") and related legislation. The first question is whether s 2B, which creates an exception to the immunity that PAWA (as an emanation of the Northern Territory Government) would otherwise enjoy from s 46 of the Act so far as PAWA "carries on a business", applied to PAWA's conduct2. The second question is whether, Now the Power and Water Corporation Act (NT) (amended by Act No 70 of Sections 2B and 2C were inserted with effect from 21 July 1996 by s 81 of the Competition Policy Reform Act 1995 (Cth). Section 2B(1) relevantly provides: "The following provisions of this Act bind the Crown in right of each of the States, of the Northern Territory and of the Australian Capital Territory, so far as the Crown carries on a business, either directly or by an authority of the State or Territory: Part IV; … (Footnote continues on next page) McHugh ACJ Callinan assuming that the Act did apply to PAWA's conduct, PAWA's rejection of NT Power's request contravened s 46 of the Act3. At trial, the Federal Court of Australia (Mansfield J) answered the first question favourably to PAWA4. It therefore dismissed NT Power's application for relief. Though it was not strictly necessary for him to deal with the second question, he adopted the helpful course of doing so, and reached conclusions favourable to NT Power5. the other provisions of this Act so far as they relate to the above provisions." Section 46 is in Part IV. "Authority" in relation to a State or Territory is defined in s 4(1) as meaning: "(a) a body corporate established for a purpose of the State or the Territory by or under a law of the State or Territory; or (b) an incorporated company in which the State or the Territory, or a body corporate referred to in paragraph (a), has a controlling interest." Section 46(1) provides: "A corporation that has a substantial degree of power in a market shall not take advantage of that power for the purpose of: eliminating or substantially damaging a competitor of the corporation or of a body corporate that is related to the corporation in that or any other market; preventing the entry of a person into that or any other market; or deterring or preventing a person from engaging in competitive conduct in that or any other market." NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR McHugh ACJ Callinan In the Full Court of the Federal Court of Australia, Lee and Branson JJ agreed with the trial judge on the first question6, and Finkelstein J dissented7. Hence the appeal was dismissed. Though it was unnecessary for the Full Court to answer the second question, they followed the trial judge's lead in addressing it: Branson and Finkelstein JJ agreed with the trial judge's conclusions8, while The third question arising in this appeal relates to certain conduct of the second respondent, Gasgo Pty Ltd ("Gasgo"), a wholly owned subsidiary of PAWA. The trial judge held that the Act did not apply to it10; hence he did not determine whether it had contravened s 4611. Lee and Branson JJ agreed with the trial judge12; Finkelstein J disagreed13. The ensuing reasons establish that the contentions of the appellant are correct, and that the appeal should be allowed against both respondents. NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR 399 at 403-405 [6]-[14] per Lee J, 414-422 [60]-[96] per Branson J. NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR 399 at 425-426 [109]-[111] per Branson J, 436-452 [142]-[186] per NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR 399 at 407 [29] per Lee J, 423-425 [101]-[107] per Branson J. NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR McHugh ACJ Callinan In view of the number and complexity of the controversies in the appeal, it is desirable to set out the order in which they will be examined. It is proposed, first, to summarise the statutory background and then the factual circumstances of the dispute, before turning to the question of whether PAWA was carrying on a business within the meaning of s 2B. That question involves consideration of the reasoning of the courts below, of what PAWA's business activities were, of how the trial was conducted in relation to that issue, and of the correct construction of s 2B. It also involves an analysis of whether PAWA's refusal of NT Power's request fell within an exception to s 2B created by s 2C(1)(b). It is then necessary to deal with numerous arguments advanced by PAWA against the conclusion that it contravened s 46, namely that there was no relevant market because of a want of transactions; that it had no market power because of s 46(4)(c); that it did not take advantage of its market power, because it took advantage only of its proprietary rights, or because it only did what the Minister for Essential Services directed it to do under s 16 of the PAWA Act; and that the trial judge wrongly inferred an exercise of market power from PAWA's purpose, confused the effect of PAWA's conduct with its purpose, confused the existence of market power and its exercise, and made incorrect, and failed to make correct, assumptions in analysing whether PAWA took advantage of market power. Finally, it is proposed to consider whether Gasgo was part of the Northern Territory Government, and whether it was in any event able to rely on what was called "derivative Crown immunity". The reasons are organised as follows: The statutory background The factual circumstances The s 2B issue The reasoning of the courts below PAWA's business activities PAWA's argument on the conduct of the trial Refusal of access to protect PAWA's retail business The correct construction of s 2B Conclusion on s 2B Was PAWA's refusal within the exception to s 2B created by s 2C(1)(b)? Contravention of s 46 McHugh ACJ Callinan Electricity infrastructure market or electricity carriage market? Section 46(4)(c) and market power Taking advantage of proprietary rights not market power? Was a direction given under s 16 of the PAWA Act? Erroneous inference from purpose? Confusion between purpose and effect? Confusion between existence and exercise of market power? Failure to make correct assumptions about a market? Alternatives available to the NT Government Conclusions on s 46 Section 46 and Gasgo Gasgo's role in the trial Part of the NT Government? Derivative Crown immunity Conclusion re Gasgo Written submissions after oral argument Orders The statutory background The first three federal enactments to deal with restrictive trade practices in this country – the Australian Industries Preservation Act 1906 (Cth), the Trade Practices Act 1965 (Cth) and the Restrictive Trade Practices Act 1971 (Cth) – did not bind the Commonwealth or the State governments14. Nor did the Act when it was enacted in its initial form in 1974. However, in April 1976, the Minister for Business and Consumer Affairs set up a Committee, known as the Swanson Committee, to review the operation and effect of the Act. It considered that the Commonwealth Government should be prepared to accept for itself, in relation to its commercial activities, restrictions which it placed on others. Hence the Committee recommended that See in particular s 6 of each of the 1965 and 1971 Acts, which had no equivalent in the 1906 Act. McHugh ACJ Callinan the Commonwealth Government and its instrumentalities, which engaged in commercial activities, should be bound by the Act to the same extent as a corporation. It also stated that while it was desirable for the Act to apply to State Governments and their instrumentalities in the same fashion, the manner in which that object was to be achieved should be worked out by consultation between the Commonwealth and State Governments15. As a result, s 2A was enacted in 197716. Section 2A(1) provided: "Subject to this section, this Act (other than Part X) binds the Crown in right of the Commonwealth in so far as the Crown in right of the Commonwealth carries on a business, either directly or by an authority of the Commonwealth." Section 2A(1) has remained substantially in that form ever since17. Section 4(1) was amended by defining "authority of the Commonwealth" to mean: a body corporate established for a purpose of the Commonwealth by or under a law of the Commonwealth or a law of a Territory; or an incorporated company in which the Commonwealth, or a body corporate referred to in paragraph (a), has a controlling interest". That has not changed since. In 1979, this Court decided that the Act did not "bind the Crown in right of a State" because of the rule of interpretation that legislation does not bind the Crown in any right unless there are express words or a necessary implication to that effect, and there were none18. Australia, Trade Practices Act Review Committee, Report to the Minister for Business and Consumer Affairs, (1976) at 87 [10.25]-[10.26] ("Swanson Report"). By s 4 of the Trade Practices Amendment Act 1977 (Cth). The only differences between the present form of s 2A(1) and its 1977 form are that after "section" there now appear the words "and sections 44E and 95D" and the words "(other than Part X)" have been omitted. Bradken Consolidated Ltd v Broken Hill Proprietary Co Ltd (1979) 145 CLR 107 at 123 per Gibbs ACJ; similar language was used by Stephen J at 129 and by Mason and Jacobs JJ at 136. At 140 Murphy J dissented on the ground that, (Footnote continues on next page) McHugh ACJ Callinan In 1987, the Full Court of the Federal Court of Australia employed similar reasoning to conclude that the Act did not bind "the Crown in right of the Northern Territory"19. In 1990, this Court, in Bropho v Western Australia20, subjected the rule of interpretation relied on in Bradken Consolidated Ltd v Broken Hill Proprietary Co Ltd21 to critical analysis. It concluded that a search for legislative intent that the general words of statutes should bind the Crown should be conducted without the restrictive limitations of the traditional rule. It did not, however, overrule Bradken Consolidated Ltd v Broken Hill Proprietary Co Ltd as an authority on the Act22. One of the reasons given for the relaxation of the traditional approach has several points of present relevance23: "[T]he historical considerations which gave rise to a presumption that the legislature would not have intended that a statute bind the Crown are largely inapplicable to conditions in this country where the activities of the executive government reach into almost all aspects of commercial, industrial and developmental endeavour and where it is a commonplace for developmental instrumentalities and their servants and agents, which are covered by the shield of the Crown either by reason of their character as such or by reason of specific statutory provision to that effect, to compete and have commercial dealings on the same basis as private enterprise." governmental commercial, industrial and In 1991, all Australian governments agreed to examine a national approach to competition policy. In 1992, they agreed on the need for a national inter alia, that rule of interpretation only applied, in the case of Commonwealth Acts, to the Commonwealth Government. Burgundy Royale Investments Pty Ltd v Westpac Banking Corporation (1987) 18 FCR 212 at 215. (1990) 171 CLR 1. (1979) 145 CLR 107. Bropho v Western Australia (1990) 171 CLR 1 at 22. Bropho v Western Australia (1990) 171 CLR 1 at 19 per Mason CJ, Deane, Dawson, Toohey, Gaudron and McHugh JJ. McHugh ACJ Callinan competition policy, and the Prime Minister appointed a committee, which became known as the Hilmer Committee, to inquire into that subject. In 1993, the Committee reported24. The Hilmer Report stated that government businesses should not enjoy any advantages when competing with other businesses. It recommended, among other things, that the Act should apply to State and Territory businesses to the same extent that it applied to Commonwealth businesses25. It also recommended that this be done by amendment of the Act (with or without referral of State legislative power under s 51(xxxvii) of the Constitution) or by the enactment of State and Territory legislation in the same terms as Pt IV of the Act26. It recommended that there should be a statutory regime to permit access to "essential facilities"27. Relevantly, the report stated that "competition in electricity generation … requires access to transmission grids"28, and used this as an example to illustrate the power of a vertically-integrated organisation with a monopoly of an "essential facility" to inhibit the access of competitors. The report noted29: "[A] business that owned an electricity transmission grid and was also participating in the electricity generation market could restrict access to the grid to prevent or limit competition in the generation market." On 25 February 1994, the Council of Australian Governments agreed "to the principles of competition policy articulated in the [Hilmer Report]"30. Australia, Independent Committee of Inquiry, National Competition Policy: Report by the Independent Committee of Inquiry, (1993) ("Hilmer Report"). Hilmer Report at xxvii, where there is an allusion to the passage in Bropho v Western Australia (1990) 171 CLR 1 at 19 quoted above; see also 343. Hilmer Report at 343, 344-347. Hilmer Report at 266-267. Hilmer Report at 240. Hilmer Report at 241. See the preamble to the Conduct Code Agreement: note 31 below. McHugh ACJ Callinan On 11 April 1995, the Council of Australian Governments entered into three Agreements31. The first was the Conduct Code Agreement. By it, the Governments agreed to extend Pt IV of the Act to all "persons" within the legislative competence of their jurisdictions (an expression which includes local and State government agencies) that carried on a business. The extension was to be effected by applying the "Competition Code text" to all persons within the legislative competence of each State and Territory through complementary enactments (cll 5(1) and (2)). The central element in the Competition Code text was the "Schedule version" of Pt IV of the Act. However, the complementary enactments did not adopt the methods of securing constitutional validity which Pt IV of the Act itself employed, namely reliance in its primary operation on s 51(xx) of the Constitution and reliance, in its additional operation, by virtue of s 6(2) of the Act, on other heads of constitutional power, principally s 51(i) and s 122 of the Constitution. Rather, the new legislation operated directly on "persons", not "corporations", adopting the solution which was the second preference of the Hilmer Committee32. The second Agreement was the Competition Principles Agreement. By cl 6(1), it was agreed that the Commonwealth would put forward legislation to establish a "regime for third party access to services provided by means of significant infrastructure facilities". By cl 5(1), the parties agreed to review and reform legislation which restricted competition, unless its benefits to the community outweighed its costs, and the objectives of the legislation could only be achieved by restricting competition. They also agreed, by cl 5(3), to develop a timetable by June 1996 for the review and reform of legislation by 2000. The third Agreement was the Agreement to Implement the National Competition Policy and Related Reforms. This made provision for payments by the Commonwealth to States and Territories that made satisfactory progress towards the implementation of the reforms set out in the other two agreements. As a result of these Agreements, s 2B, s 2C (which created some exceptions to s 2B), Pt IIIA (which created a regime for access to essential These are conveniently set out in Australian Trade Practices Legislation: Consolidated to 3 July 2002 (CCH Australia Ltd), 18th ed (2002) at 821-842. Hilmer Report at 344-346, 347. The Committee's first preference was for a referral of powers from the States and Territories to the Commonwealth. McHugh ACJ Callinan facilities), and ss 150A and 150C (which incorporated the Schedule version of Pt IV of the Act) were all introduced into the Act by the Competition Policy Reform Act 1995 (Cth) ("the Reform Act"). The Competition Policy Reform (Northern Territory) Act (NT) ("the Competition Act") was then enacted. It provided that the Competition Code (including the Schedule version of Pt IV of the Act) applied as a law of the Territory (s 5(1)). Sections 14 and 15 were, for the Territory, to similar effect as ss 2B and 2C of the Act. Clause 46 of the Schedule version of Pt IV of the Act was in the same terms as s 46 of the Act, save that in lieu of references to "corporation" in the Act there appeared references to "person". Sometimes, analysis in the courts below proceeded as if the relevant legislation were the Act; sometimes it proceeded as if the relevant legislation were the Competition Act and Competition Code. Neither side contended that it made any relevant difference which applied. PAWA, in particular, appeared content to have the case determined as though the Act applied, which must mean either that it abandoned its pleaded denial that it was a trading corporation, or that it accepted that the conduct took place in trade and commerce within the Northern Territory within the meaning of s 6(2)(b)(iii) of the Act. In general, analysis will proceed by reference to the provisions of the Act. The factual circumstances Before 1978, electricity was supplied in the Northern Territory by the Commonwealth Department of Works and Housing. After the advent of self- government on 1 July 1978, the Commonwealth's electricity assets were vested in the Northern Territory33 and the Northern Territory Electricity Commission ("NTEC") took over the function of electricity supply34. In 1987, by s 4(2)(d) of the PAWA Act, PAWA succeeded NTEC. PAWA conducted a vertically integrated enterprise. First, PAWA had generation facilities. It generated electricity at several stations in the Northern Territory which it either owned or controlled through contracts. It also purchased electricity generated by other persons, who conducted mining operations and made their surplus power available. One of these persons was NT Power. Northern Territory (Self-Government) Act 1978 (Cth), s 69. Electricity Commission Ordinance (NT), s 13. This enactment subsequently became the Electricity Act (NT) referred to below at [92]. McHugh ACJ Callinan In addition, PAWA had transmission facilities. It carried power of 33 kV and above through the 529 kilometres of power transmission lines which it owned. The only other power transmission line in the Northern Territory, 300 kilometres in length (known as "the 132 kV line") linked Darwin and Katherine. The 132 kV line was owned by a company related to NT Power and leased to another company related to NT Power, namely NT Power Transmission Pty Ltd ("NT Transmission"). NT Transmission used the 132 kV line to transmit electricity to and from PAWA under a series of agreements pursuant to which PAWA bought electricity from that company at certain supply points and sold it to that company at certain re-delivery points. NT Transmission was authorised to sell electricity to customers other than PAWA at certain points along the 132 kV line on certain conditions, but not to customers within 50 kilometres of Darwin, 20 kilometres of Katherine or 5 kilometres of Pine Creek. PAWA also owned distribution facilities – low voltage electricity lines, substations and transformers. These operated as a distribution network, eventually leading into the meter box of each individual consumer. In 1996, Pegasus Gold Australia Pty Ltd ("Pegasus"), the then operator of the Mt Todd Gold Mine ("the Mt Todd Mine"), contracted with NT Power for the operation and maintenance of a gas-fired power station at that mine ("the Mt Todd PS"). In September 1996, PAWA licensed NT Power to sell electricity to Pegasus. That electricity was either generated by NT Power at the Mt Todd PS or purchased from PAWA. PAWA agreed to buy surplus electricity generated at the Mt Todd PS from NT Power as it required it. The Mt Todd Mine was approximately 20 kilometres east of the Edith River Substation on the 132 kV line, and two 22 kV lines owned by NT Power ran between the Edith River Substation and the Mt Todd Substation, adjacent to the Mt Todd PS. In November 1997, Pegasus ceased to operate the Mt Todd Mine, and it fell dormant until a new owner assumed control in July-August 1999. For NT Power this created a problem and an opportunity. The problem was that it would have much more surplus power available from the Mt Todd PS. The opportunity was that it became entitled to acquire the Mt Todd PS from Pegasus. NT Power decided to solve the problem by selling the electricity it generated at the Mt Todd PS to the general public, including commercial users of electricity in Darwin and Katherine, in competition with PAWA. To that end, NT Power decided to acquire the Mt Todd PS in January 1998, and did so on 3 April 1998. McHugh ACJ Callinan For three years, the previous the Northern Territory had been endeavouring to implement the obligations arising from its adherence, at the meeting of the Council of Australian Governments on 25 February 1994, to the principles of competition policy articulated in the Hilmer Report, and its entry into the Agreements of 11 April 1995. After it carried out the first of these obligations by enacting the Competition Act, it became apparent that there were various aspects of the Northern Territory's obligations which affected PAWA. that it was agreed the regime for access One of these related to Pt IIIA of the Act. By cl 6(2) of the Competition Principles Agreement, then contemplated, and which was in due course established by Pt IIIA, was "not intended to cover a service provided by means of a facility where the … Territory Party in whose jurisdiction the facility is situated has in place an access regime which covers the facility and conforms to the principles set out in this clause". These principles were stated in cl 6(4) of the Competition Principles Agreement and broadly corresponded to those underlying Pt IIIA of the Act. Clause 6(2) was reflected in the Act in provisions which excluded the operation of Pt IIIA in respect of an "effective access regime". Thus an effective access regime is "a regime for access to a service or a proposed service" (s 44M(1)) which either the relevant Commonwealth Minister (s 44H(5) and s 44N(1)) or the National Competition Council ("the Council") (s 44G(3)) has decided is "effective" in the light of the principles set out in the Competition Principles Agreement. After some indecision, in October 1997 a PAWA officer was allocated to work full-time on evaluating and recommending a regime for access to PAWA's infrastructure. Around that time, Mr Gardner took up office as Chief Executive Officer of PAWA. He formed the view that PAWA had serious operational deficiencies which inhibited its ability to compete with any other supplier of electricity to consumers in the Darwin-Katherine area. He prepared an operational assessment supporting in December 1997, which assessment was submitted to Cabinet for its meeting on 5 March 1998. Cabinet decided that a major review of PAWA should be undertaken. This was announced in the Treasurer's Budget Speech on 28 April 1998, which said that one aspect would be "the development of access regimes in accordance with National Competition Policy requirements"35. that view Northern Territory, Legislative Assembly, Parliamentary Debates (Hansard), 28 April 1998 at 1085. McHugh ACJ Callinan On 26 June 1998, PAWA granted NT Power a licence to sell to any person in the Northern Territory electricity generated by it at the Mt Todd PS36. Before that date, NT Power had made plain to PAWA its desire for access to PAWA's infrastructure so as to supply electricity to consumers in the Darwin- Katherine area, and they had communicated with each other about this extensively37. This led Cabinet, on 29 June 1998, to approve the making of a "Scoping Study" by a consortium comprising Merrill Lynch International (Australia) Limited ("Merrill Lynch") and Fay Richwhite Australia Limited ("Fay Richwhite"), so as to enable PAWA to respond to NT Power's desire for infrastructure access. Consideration of the question within PAWA, and in dealings between PAWA and NT Power on the one hand and PAWA and the Government on the other, continued for the next two months. On 17 August 1998, the solicitors for NT Power wrote a letter to PAWA, asking that the charges for NT Power's use of the infrastructure be settled speedily, and seeking a response within seven days. They sent a copy to the Australian Competition and Consumer Commission. The question of what response should be sent led to a few days of intensive dealings between officers of PAWA, PAWA's solicitors, Merrill Lynch, the Treasurer and the Minister for Essential Services. On 26 August 1998, a letter from PAWA's solicitors, approved by the Treasurer and the Minister, denied that any access had been agreed and said that the issue was the subject of a policy review by PAWA and the Government. The trial judge found that the letter of 26 August 1998 brought to an end the discussions about the terms upon which NT Power might be granted access to PAWA's infrastructure. It meant that NT Power was not to be granted access to The trial judge rejected NT Power's argument that that licence contained an implied term about access to infrastructure: NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 481 at 568-575 [378]-[398]. The judges of the Full Federal Court who addressed the issue agreed: NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR 399 at 422-423 [97]-[100] per Branson J, 452-453 [187] per Finkelstein J. The argument was not pursued in this Court. For example, by letters of or meetings on 10 February 1998, 16 March 1998, 25 May 1998, 28 May 1998, 4 June 1998, and 24 June 1998. McHugh ACJ Callinan PAWA's infrastructure at that time or until, and under the terms of, the access regime introduced on 1 April 2000; and that PAWA would not indicate to NT Power the terms upon which PAWA would grant access to its infrastructure, at least until the access regime was disclosed38. No further progress was made, and these proceedings commenced on 12 March 1999. The access regime for electricity supply referred to by the trial judge was approved by Cabinet on 14 September 1999 and enacted in 2000 by the Electricity Networks (Third Party Access) Act (NT) and related legislation. On 30 November 1999, the Chief Minister applied to the National Competition Council pursuant to s 44M of the Act for a recommendation that the access regime was an effective regime. That had not been determined by the time of the trial judge's decision on 3 April 2001. The s 2B issue: the reasoning of the courts below The courts below found, and in this Court it was common ground, that PAWA was a body corporate established for the purposes of the Northern Territory under the PAWA Act, and hence was an "authority of the … Territory" under s 2B(1)39. The courts below accepted various arguments advanced by PAWA that PAWA was not relevantly carrying on a business within the meaning of s 2B. Those arguments centred on the fact that it did not provide any access to its infrastructure to anyone. The trial judge said that PAWA's use of its assets for the purpose of conducting the business of generating and selling electricity "is not in respect of the carrying on of business by PAWA in the provision of access to its infrastructure, but is for the fulfilment of PAWA's function of planning and coordinating the generation and supply of electricity in the Northern Territory: NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 481 at 540-541 [267]-[268], 544 [283]; NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR 399 at 403 [4] per Lee J, 416 [67], 419 [81] per Branson J, 430-431 [124]-[127] per Finkelstein J. McHugh ACJ Callinan see s 14(1)(b) and (d) of the PAWA Act"40. He applied to s 2B a construction which he said had been adopted by Emmett J for s 2A in J S McMillan Pty Ltd v Commonwealth41. Emmett J rejected the view that once it is accepted that the relevant government is carrying on a business, the Act applies to all conduct connected in some way with that business. He said that the expression "insofar as the Commonwealth carries on a business" indicated "that the Commonwealth is to be bound only where the conduct complained of is engaged in, in the course of carrying on the business"42. The reasoning of the majority of the Full Federal Court was similar to that of the trial judge43 but they also held that the non-applicability of s 2B was NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 481 at 548 [299]. Section 14(1) provided: "The functions of the Authority are, in relation to electricity – to supply electricity within or outside of the Territory; to plan and co-ordinate the generation and supply of electricity for the Territory or elsewhere; to promote the safe use of electricity; to control the supply of electricity; to advise the Minister on all matters concerning electricity; to evaluate the present and future needs of the Territory or any place outside of the Territory in respect of fuel, energy and power for the purpose of generating electricity …" (1997) 77 FCR 337 at 356. (1997) 7 FCR 337 at 356. The trial judge quoted Emmett J and agreed with his reasons: NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 481 at 547 [294]-[295]. Branson J did at one point suggest that it was necessary to demonstrate that "the totality of PAWA's enterprise constitutes the carrying on of a business": NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR 399 at 421 [89]. However, PAWA did not support that proposition on the appeal to this Court. McHugh ACJ Callinan supported by Dowling v Dalgety Australia Ltd44. Lockhart J there held that the owners of private yards for the auction of livestock were not obliged to make them available to a person desiring to trade in the yards as a livestock auctioneer, because they were not in the business of granting licences or leases of the yards but in the business of providing livestock selling services. Their exclusion of the applicant was held to be lawful, according to the majority's reading of Lockhart J's reasoning, because they took advantage of their proprietary rights, and not their market power45. Hence, to use Branson J's words, ss 2A and 2B46: "disclose no intention … to require the Crown … to engage in a business activity; rather they are concerned with the standards of conduct which are to be observed if the Crown does choose to engage in a business activity. In this case, the Crown through PAWA has not chosen to undertake the commercial activity of providing access to its infrastructure to others; rather it decided not to carry on a business of providing access to its infrastructure. I am not able to discern a legislative intention that where the Crown makes such a choice it can nonetheless be forced, in effect, to carry on that business." Branson J also advanced other arguments for her conclusion, and these are considered below. Finkelstein J disagreed. He held that the Act did not only apply to an authority where the challenged conduct itself amounts to carrying on a business; it applied to conduct engaged in during the course of a business as well. In his view, if the operation of s 2B and s 13 were restricted so that the legislation only applied to conduct which was itself the carrying on of a business, the legislative object of putting government business on the same footing as private enterprise would not be achieved47: (1992) 34 FCR 109 at 145-146. NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR 399 at 404-405 [9]-[12] per Lee J, 421 [90] per Branson J. NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR McHugh ACJ Callinan "Private corporations that are regulated by the Competition Code, and [the Act] (upon which the Code is modelled), are caught by their provisions if they engage in anti-competitive conduct in the course of carrying on their commercial activities, not because that conduct is itself an aspect of their respective businesses. Moreover, a good deal of the activities that are caught by the antitrust provisions could not be characterised as being of a trading or commercial character. So it should be with the Crown. In my opinion, if conduct by the Crown is engaged in during the course of carrying on a business, that is sufficient to bring it under the Code's umbrella." The s 2B issue: PAWA's business activities One matter is not controversial. PAWA was carrying on a very substantial business. The trial judge found that PAWA used its infrastructure "as part of the means of conducting the business of generating and supplying electricity"48. There are many references in PAWA's internal documents revealing that its officers perceived it to be carrying on a business. This can also be seen in its 1998 Annual Report ("the Report"), which was being prepared as the decision to refuse access was being made and then adhered to. The Report was presented to the Minister for Essential Services in accordance with s 28(1) of the Public Sector Employment and Management Act (NT). Section 28(4) imposed an obligation on the Minister to make it public by laying a copy of it before the Legislative Assembly within six sitting days of receipt. The Report spoke of PAWA's "core business", of the fact that it was undergoing "commercialisation", of its "commercial functions", and of "its Vision" ("[t]o thrive in the competitive north Australia utility services market"). The Report stated: "Like all business, [PAWA] needs to generate a return on the very significant amount of capital invested", and spoke of the need for efficiency and cost-effectiveness. The Report discussed indicators like the rate of return on assets and the debt to capital ratio. In many respects, the language of the Report and the form of the accounts correspond with those in any non-governmental trading corporation. This is scarcely surprising in view of PAWA's duty, under s 17(1) of the PAWA Act, to act "in a commercial manner". PAWA had sales NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 481 at 549 [302]. See also NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR 399 at 403 [7] per Lee J, at 420-421 [87], [89] per McHugh ACJ Callinan revenue in the year to 30 June 1998 of $253,181,000, of which power sales accounted for $206,272,000. More specifically, the Report referred to the transmission and distribution facilities, which PAWA now contends are outside the scope of any business activity, as "business products" and it referred to the use of those facilities as "electricity transmission services" and "commercial services". The Report described PAWA's entire operation as a "business" having a "power" segment, with "upstream (generation …) and downstream (transmission, distribution and reticulation networks, and retail) components". These are admissions. Technically they are "informal" admissions, but, having been made pursuant to statutory duties and in a document which there was a statutory duty to make public, they are of the utmost solemnity. The admissions in relation to the transmission and distribution facilities, in particular, are totally inconsistent with the case on the application of s 2B which PAWA propounded in this litigation. Carrying on a business in a market: PAWA's argument on the conduct of the trial In this Court, PAWA's first contention in defence of the proposition that it was not relevantly carrying on a business rested on NT Power's conduct of the trial. PAWA asserted that the only case against it was that it took advantage of its power in one market (the market for the supply of electricity infrastructure services) in order to prevent NT Power from competing in a different market (the market for the sale of electricity to consumers). The first market was one in which there had been no transactions, and one in which PAWA had never supplied or acquired goods or services. PAWA used the infrastructure only to carry its own electricity – electricity which it had either generated itself or bought from persons like NT Power. NT Power met this contention by saying that it had never abandoned a plea that PAWA had market power in the market for the sale of electricity to consumers (which was derived from its control of electricity infrastructure services), and took advantage of that market power for the purpose of injuring NT Power in the market for the sale of electricity to consumers. This controversy between the parties was treated by them as being significant mainly in relation to the role of s 46(4)(c) in assessing whether s 46 was contravened49, but it is also relevant to s 2A. See [104]-[115] below. McHugh ACJ Callinan The wide pleaded case was not abandoned. The first difficulty with PAWA's contention is that the case pleaded by NT Power was indeed wide. After the trial began, the pleadings were amended to accommodate all possible findings that might flow from disagreements on market definition, which had emerged between the experts called by the parties. Thereafter pars 4 and 4A of NT Power's Further Amended Statement of Claim ("the Statement of Claim") alleged the following markets: "4. At all material times there existed in the Northern Territory, markets: for the supply of electricity to persons in the Northern Territory ('the Electricity Supply Market'); for the supply of the service of the use of electricity transmission and distribution infrastructure located in the Northern Territory to persons intending to generate and sell electricity to other persons in the Northern Territory ('the Electricity Infrastructure Market'). 4A. Alternatively, at all material times there existed in the Northern Territory markets: for the generation of electricity ('the Electricity Generation Market'); and the for Transmission Market'); and transmission of electricity ('the Electricity for the distribution of electricity ('the Electricity Distribution Market'); or alternatively to (b) and (c) for the transmission and distribution of electricity ('the Electricity Carriage Market'); and for the sale of electricity ('the Electricity Sale Market')." In the respondents' Second Further Amended Defence ("the Defence"), par 4(b) was denied and par 4A(d) was not admitted, but the other allegations were admitted. Paragraph 23 of the Statement of Claim alleged that PAWA had refused access to "the Existing Infrastructure" (defined in par 9 as "substantially the whole of the electricity transmission and distribution infrastructure located in McHugh ACJ Callinan the Northern Territory"). Among the particularised refusals was the letter of 26 August 1998. Paragraph 24 alleged: "The conduct of [PAWA] referred to in paragraph 23 was engaged [in] and is continuing to be engaged in by it: in the exercise of its market power: in the Electricity Supply Market; and/or in the Electricity Infrastructure Market; (iii) in the Electricity Transmission Market and the Electricity Distribution Market; or, alternatively in the Electricity Carriage Market; or, alternatively in the Electricity Sale Market; for the purpose, or alternatively for purposes which included the substantial purpose, of: preventing the entry of [NT Power] into the Electricity Supply Market or, alternatively, the Electricity Sale Market in contravention of s.46(1)(b) of [the Act] and/or s.46(1)(b) of the Competition Code text as that term is defined in s.4 of [the Competition Act] (the 'Competition Code'); deterring, or alternatively preventing [NT Power] from engaging in competitive conduct in the Electricity Supply Market or, alternatively, the Electricity Sale Market in contravention of s.46(1)(c) of [the Act] and/or s.46(1)(c) of the Competition Code, namely selling electricity to persons in the Northern Territory in accordance with the Licence in competition with [PAWA]." Sub-paragraphs 24(a)(i) and (v) alleged a taking advantage of power in markets in which, if they existed, PAWA unquestionably carried on business in competition with others. But PAWA argued that it was only the conduct alleged in sub-pars 24(a)(ii) and (iii), together with similar allegations in par 25, which was in issue. In oral argument, PAWA said: "The case was not conducted or approached on the basis that advantage was taken of market power in the sale market or the generation market". McHugh ACJ Callinan That proposition, which PAWA regarded as crucial, has not been established. The following matters are agreed, either expressly or tacitly. The newer allegations in the Statement of Claim, which are indicated by the underlining in the quotations above, were made on 18 August 1999, 15 days after the trial commenced. Those allegations were never withdrawn. The trial proceeded on the basis that any party was at liberty to call evidence on any issue on the pleadings. The parties treated the Electricity Sale Market as being the same as the Electricity Supply Market, and the existence of both markets was admitted. In his final address, counsel for NT Power made submissions supporting a taking advantage of power in the Electricity Transmission Market, the Electricity Distribution Market, or, alternatively, the Electricity Carriage Market. He did not address a submission in support of the allegation in sub-par 24(a)(v) of the Statement of Claim – a taking advantage of power in the Electricity Sale Market. However, since PAWA had not lost any chance, before the evidence closed, of calling evidence "which by any possibility could have prevented the point from succeeding"50, the point can be taken now. In this Court, PAWA initially asserted, but then abandoned, a complaint of prejudice arising from a loss of opportunity to call evidence; it complained only of the difficulty of addressing the "issue on our feet with time constraints". In written submissions filed two months after the oral hearing, the primary prejudice which PAWA identified lay in its supposed inability to deal in written submissions with the argument whether it was possible that PAWA could derive market power in one market from power in another, and to refer to authorities on that subject. That is not prejudice in view of the opportunity to provide, and the actual provision of, those written submissions after the conclusion of the oral argument. The authorities which prevent points being raised in ultimate or intermediate courts of appeal do not prevent them being raised if those points remained open at the trial. PAWA also relied on the fact that this Court does not have the views of the trial Suttor v Gundowda Pty Ltd (1950) 81 CLR 418 at 438 per Latham CJ, Williams McHugh ACJ Callinan judge on the point, but it was pleaded, evidence was called on it, and related questions were sufficiently fully considered to prevent the unavailability of the trial judge's views being a disabling handicap. Further, though the objection raised now by PAWA (that it was not carrying on business in the transmission and distribution markets) appears to have attracted the trial judge and was presumably argued before him, it was not pleaded by PAWA. A party who has not pleaded, but later raises, a particular factual barrier cannot criticise a second party for seeking to overcome that factual barrier by relying in an appellate court on matters pleaded by that second party which were not abandoned at trial and which are supported by evidence called at trial. NT Power therefore contends that the question is whether PAWA's conduct can be characterised as taking advantage of its power in the Electricity Sale Market, in which it unquestionably carried on business within the meaning of s 2B, for the purpose of injuring NT Power either in the Electricity Supply Market or the Electricity Sale Market. It is a question which is open in this Court, since it does not turn on any assessment of testimonial credibility. The trial judge found that PAWA had power in the markets concerned with transmission and distribution51. There was no challenge to or disagreement with that finding in the Full Federal Court, and there was no challenge to it in this Court. PAWA also had power in the Electricity Supply Market: PAWA admitted that there were substantial barriers to entry to, and that it had a substantial degree of market power in, the Electricity Supply Market. It followed from this admission and the agreement of the parties not to distinguish between the Electricity Supply Market and the Electricity Sale Market that PAWA had a substantial degree of power in the Electricity Sale Market, despite PAWA's denial of that allegation in the pleadings. That conclusion was supported by NT the Power's expert. transmission/distribution markets, and the Electricity Supply Market/Electricity Sale Market – derived in part from PAWA's ownership of infrastructure: the trial judge found that it "constitutes a natural monopoly", and there was no "credible threat of entry" by another competitor52. That ownership operated as a barrier to in both classes of market – The power NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 481 at 560 [351]. This was assisted by PAWA's vertical integration. See Queensland Wire Industries Pty Ltd v Broken Hill Proprietary Co Ltd (1988) 167 CLR 177 at 190 where Mason CJ and Wilson J said: "power companies usually own distribution systems. This enables them to discriminate in pricing (Footnote continues on next page) McHugh ACJ Callinan entry in both classes of market and was hence a source of market power in both as well. PAWA took advantage of its market power, not only in the transmission/distribution markets, but also the Electricity Supply Market/Electricity Sale Market, for the purpose of injuring NT Power in the latter markets. There is an unconvincing artificiality in PAWA's distinction between exercising market power in the former markets and exercising it in the latter, when the critical fact underlying both types of market power was PAWA's control of the infrastructure. Carrying on a business in a market: refusal of access in order to protect PAWA's retail business However, let it be assumed that the contention that PAWA advanced is in fact sound. On that assumption, the proceedings below were decided on the basis that the actual case had narrowed considerably from that pleaded to one in which PAWA took advantage of its power in the transmission/distribution markets in which it faced no competition and made no sales53 for the purpose of injuring NT Power in the market for the sale of electricity to consumers. Even on that assumption, PAWA's conduct went beyond a mere taking advantage of its market power in the transmission/distribution markets in which it faced no competition and conducted no sales. PAWA's conduct involved taking advantage of its market power in those markets for the purpose of achieving results in another. The results PAWA desired in the market or markets for the sale of electricity to consumers (the Electricity Supply Market and the Electricity Sale Market) were results that advantaged its position in that market or those markets, in which PAWA does not dispute that it conducted much business. PAWA used, as part of the means of conducting that business, its transmission and distribution infrastructure services to transmit and distribute electricity generated or bought by it to consumers. PAWA made a decision, according to the courts below, not to use or permit the use of its transmission and distribution infrastructure services for the transmission and distribution of electricity generated by a competitor or potential competitor, namely NT Power, to customers, because of the negative impact that this would have in the short term on its business of selling electricity to consumers. That was conduct which advanced the business. It was conduct "so far as" PAWA carried on a business. … ." See also United States v United Shoe Machinery Corp 110 F Supp 295 at 346 (D Mass, 1953). PAWA's argument that there were no such "markets" because of a lack of sales is rejected below at [104]-[110]. McHugh ACJ Callinan Carrying on a business in a market: the correct construction of s 2B Even if, contrary to what has just been said, PAWA's last contention is correct, it was carrying on a business within the meaning of s 2B on its correct construction. The legislative context. While the word "business" in any particular context takes its meaning from that context54, normally it is a "wide and general" word55. Its meaning in the Act is widened by s 4(1), since "business" includes "a business not carried on for profit". The legislation as a whole is remedial; s 2 provides that the object of the Act is "to enhance the welfare of Australians through the promotion of competition …". The purpose of introducing s 2A, as explained by the Swanson Committee and noted above, was to ensure that the Commonwealth Government should, in its commercial activities, be subject to the same regime as corporations56. One of the goals of the legislation recommended by the Hilmer Report was to ensure that the legislation applied to businesses conducted by the governments of the States and Territories to the same extent as it did to those conducted by the Commonwealth57. The Second Reading Speech delivered in the House of Representatives when the Reform Act was introduced as a Bill stated that it and the three Agreements of 11 April 1995 represented "a complete response to the recommendations of the Hilmer committee"58. It was said that the amendments to the Act, taken with State and Territory application legislation, ensured that "the prohibitions against anti- competitive conduct can be applied to all businesses in Australia"59. It was Re Australian Industrial Relations Commission; Ex parte Australian Transport Officers Federation (1990) 171 CLR 216 at 226 per Mason CJ, Gaudron and Actors and Announcers Equity Association of Australia v Fontana Films Pty Ltd (1982) 150 CLR 169 at 184 per Gibbs CJ. Swanson Report at 87 [10.25]. Hilmer Report at xxvii and 343. Australia, House of Representatives, Parliamentary Debates (Hansard), 30 June Australia, House of Representatives, Parliamentary Debates (Hansard), 30 June McHugh ACJ Callinan further said that one of the main features of the Bill was that it "extends the operation of [the Pt IV] competitive conduct rules to currently exempt businesses"60. Section 2B was clearly a crucial provision in attaining these goals. The flaws in PAWA's approach. PAWA proceeded on an erroneous construction of s 2B. It may be accepted that the conduct proscribed by the Act, if it is to fall within s 2B, must be engaged in in the course of PAWA carrying on a business. But the conduct need not itself be the actual business engaged in. Had s 2B not been enacted, the conduct alleged against PAWA would not be examinable under the legislation because PAWA is an authority of the Territory – part of the "Crown in right … of the Northern Territory", ie the Northern Territory Government61. But where such an authority "carries on a business" this removes the governmental obstacle to curial examination of its conduct in order to see whether s 46 has been contravened. PAWA would reverse the process and invert the correct approach: according to PAWA, it is necessary to examine specific conduct, and only when a particular contravention is found is it then relevant to examine whether that contravention can be described as carrying on a business. The Act is seeking to advance the broad goal of promoting competition. Certain provisions of the Act, particularly in Pt IV, necessarily turn to a significant degree on expressions which are not precise or formally exact. One example is "market": there can be overlapping markets with blurred limits62 and disagreements between bona fide and reasonable experts about their definition, as in this case. Other examples are "substantial", "competition", "arrangement", "understanding", "purpose" and "reason" (which need only be a "substantial" purpose or reason: s 4F). It is not appropriate to subject the application of this type of legislation to a process of anatomising, filleting and dissecting in the fashion advocated by PAWA. Australia, House of Representatives, Parliamentary Debates (Hansard), 30 June Section 5 of the Northern Territory (Self-Government) Act 1978 (Cth) states: "The Northern Territory of Australia is hereby established as a body politic under the Crown by the name of the Northern Territory of Australia." Queensland Wire Industries Pty Ltd v Broken Hill Proprietary Co Ltd (1989) 167 CLR 177 at 196 per Deane J. McHugh ACJ Callinan Another flaw in PAWA's contention that its failure to supply the service of access to its infrastructure meant that it was not carrying on a business is that it substitutes the question of defining markets for the question of whether a business is being carried on. It was crucial to the trial judge's reasoning that PAWA was not trading or attempting to trade in the service of providing access to its infrastructure, and was not engaged in the business of acquiring infrastructure assets63. It was crucial to Branson J's reasoning that "PAWA does not compete with others either to obtain the use of infrastructure or to provide access to its infrastructure to third parties. It is not in the commercial marketplace in relation to its infrastructure"64. This recourse to ideas of rivalry in the acquisition or provision of services, of "competition" and of "market places", suggests a search for goods or services that were "substitutable for, or otherwise competitive with" each other – that is, a search for the existence of markets as defined in s 4E of the Act65. However, the words "market" and "business" have distinct meanings. Nothing in the Act limits the meaning of "business" by reference to the criteria for market definition. Businesses often operate across the boundaries of separate markets. PAWA's use of its infrastructure assets was a part of its carrying on of a business, whether or not it was in a market for their acquisition, sale or hire. In 1998, the provisions applied by s 2B to State and Territorial government businesses were limited to Pts IV, XIB and related provisions. Part XIB, like Pt IV itself, deals with much conduct that is not related to market definition. Further, s 2A, which uses substantially the same language as s 2B, applies the Act as a whole to Commonwealth businesses. Thus, the immense range of provisions that relate to consumer protection (Pts IVA, IVB, V, VA and VC) apply to Commonwealth Government businesses, quite independently of any market issues. NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR Section 4E provides: "For the purposes of this Act, unless the contrary intention appears, market means a market in Australia and, when used in relation to any goods or services, includes a market for those goods or services and other goods or services that are substitutable for, or otherwise competitive with, the first- mentioned goods or services." McHugh ACJ Callinan All these considerations militate against any approach to the question of "carrying on a business" by reference to competition in a market. That in turn renders it irrelevant whether PAWA was competing in acquiring infrastructure assets or was active in seeking to supply infrastructure services. The only question is: what business was PAWA carrying on? So far as it was carrying on a business, s 46 applied to it. Further, as Finkelstein J pointed out66, PAWA's construction, in treating as crucial its non-supply of access to its infrastructure, detracts from the legislative goal of securing equivalent treatment of non-government and government businesses. Private businesses which refuse absolutely to provide goods or services desired by others, even if they are competitors, can in some circumstances fall within the language of s 4667. A construction of s 2B which prevents unconvincing. It would permit a government business to remain immune from the legislation so long as it were consistently anti-competitive in denying infrastructure access; and indeed to remain immune on the first occasion when it permitted access, even if it did so on a discriminatory basis. After that point it would be "carrying on a business" and therefore caught by the Act, but only then. The statutory language does not suggest that this anomaly was contemplated. the same outcome for government businesses that do so In short, PAWA's denial of access to its infrastructure to NT Power, for no reason of want of capacity or technical difficulty or safety, but simply in order to protect its revenue position in relation to electricity sales, was conduct designed to secure PAWA's position as part of its carrying on of a business. Authorities relied on by PAWA. The authorities relied on in support of PAWA's construction do not in fact support it. The first authority, J S McMillan Pty Ltd v Commonwealth68, a decision of Emmett J, held that the fact that the Australian Government Printing Service carried on a publishing business did not mean that the Commonwealth, in conducting a sale of that business, was carrying on a business. The officers NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR 399 at 435 [138], quoted above at [51]. Queensland Wire Industries Pty Ltd v Broken Hill Proprietary Co Ltd (1989) 167 CLR 177. (1997) 77 FCR 337. McHugh ACJ Callinan engaged in the sale had nothing to do with the day-to-day operations of the enterprise; the Commonwealth did not conduct any business of selling assets69. The reading by PAWA of Emmett J's judgment as based on grounds narrow enough to exclude PAWA from the Act is not convincing. Emmett J required the "conduct complained of" to be "engaged in, in the course of carrying on the business"70. Those words apply to PAWA: in the course of carrying on the business of supplying retail customers, and for the purpose of preventing short- term competition in that business from NT Power, it denied NT Power access to its infrastructure services. Next, the reliance by PAWA on Dowling v Dalgety Australia Ltd71 is misplaced in relation to s 2B. No governmental body was involved in the case, and Lockhart J was not considering the construction of s 2A (or s 2B, which did not then exist). Whether or not Lockhart J's reasoning assists PAWA in its denial of a contravention of s 46, a matter considered below, it cannot cast light on an issue not considered by him. Compelling the Crown to carry on a business. Branson J denied that ss 2A and 2B, in conjunction with s 46, could be read as requiring the Crown to engage in a business activity72. However, s 46 and other provisions can operate not only to prevent non-governmental traders from doing prohibited things, but also to compel them positively to do things they do not want to do73. If non- governmental traders are in this position, and governmental traders are to be treated equivalently, there is nothing surprising in a conclusion that the latter may be compelled to engage in business activities when they do not wish to. Constitutional complexities? Branson J said that nothing in s 2B suggested that it was intended to have a different application in respect of the Northern Territory and the Australian Capital Territory from that which it had in respect of the States. Her Honour then stated that there were "significant (1997) 77 FCR 337 at 356-357. (1997) 77 FCR 337 at 356. (1992) 34 FCR 109 at 145-146. NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR Queensland Wire Industries Pty Ltd v Broken Hill Proprietary Co Ltd (1989) 167 CLR 177. McHugh ACJ Callinan constitutional complexities associated with a law of the Commonwealth which purports to interfere with the property rights of a State"74. She implicitly suggested that these difficulties must compel a narrower reading of s 2B than would otherwise be the case. However, in this Court, no notices under s 78B of the Judiciary Act 1903 (Cth) were thought necessary, least of all by PAWA. None of the three States which intervened by leave raised any constitutional point. No difficulties of the kind indicated by Branson J can arise in relation to NT Power's claim under the Competition Act, for it is a law of the Northern Territory interfering (if it does interfere) with the property rights of an authority of the Northern Territory. Nor, by parity of reasoning, can any difficulty of that kind arise in relation to the State legislation that corresponds to the Competition Act. Any constitutional difficulties that may exist in relation to s 2B of the Act are thus immaterial. Granting access to Crown infrastructure: problems of remedy. Branson J said that s 2B should not be read so widely as to introduce an access regime via s 46, because to do so would cause "significant difficulties" to arise in relation to the framing of orders "to grant access to Crown infrastructure"75. Her Honour stated that these were difficulties over and above the difficulties which exist anyway in s 46 cases "when attempting to frame orders that require a party to behave as it would in a competitive market where in fact there is no such market by which to determine this behaviour"76. There certainly could be difficulties in relation to injunctions "to grant access to Crown infrastructure". However, they are not, in s 46 cases, unique to situations involving governments or governmental authorities77. If the difficulties in relation to injunctions are insuperable, they may prevent injunctions from being granted but they do not prevent other relief. NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR See Melway Publishing Pty Ltd v Robert Hicks Pty Ltd (2001) 205 CLR 1 at 25-26 [59]-[60] per Gleeson CJ, Gummow, Hayne and Callinan JJ. McHugh ACJ Callinan Section 46 as an alternative access regime. Branson J pointed out that s 44E provides that Pt IIIA binds the Crown in right of the Commonwealth, the States and the Territories without any limitation with respect to the carrying on of a business. She also pointed out that s 2B was introduced into the Act by the same statute as introduced Pt IIIA (that is, the Reform Act)78: "In this regard [Pt IIIA] gives effect to the Competition Principles Agreement … In my view, no legislative intention may in the circumstances be discerned that s 2B, together with Pt IV, should provide an alternative means to the complex process established by Pt IIIA by which, provided that no other effective access regime is in place, access to State or Territory infrastructure may in certain circumstances be obtained – at least where the Crown is not already in the business of providing access to that infrastructure." There are several answers to this reliance on the availability of access under Pt IIIA as a reason for construing s 2B so as to prevent an alternative access regime arising under s 46. First, the structure of the Act indicates the opposite because s 44ZZNA provides that Pt IIIA is to have no effect on the operation of Pt IV. Secondly, the point would not answer NT Power's alternative cause of action under the Competition Act, which has no provisions similar to Pt IIIA. Thirdly, if there is a disharmony between the existence of Pt IIIA as a means of access, and a construction of s 2B that enables s 46 to be used as a means of access, that disharmony would weigh against s 46 being used to create an access regime even if the Crown were already in the business of providing access to infrastructure. Yet it is accepted in the passage just quoted that s 2B does not prevent s 46 applying in those circumstances. Indeed, the supposed disharmony would weigh against s 46 being used to create an access regime of any kind, and Lee J, who was of the opinion that s 46 "does not purport to interfere with the due exercise of rights of property per se"79, NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR McHugh ACJ Callinan gave various examples of the supposed inability of one competitor to obtain access to the real or personal property of another80. However, private traders could be obliged to supply goods or services against their will before s 2B was enacted, provided the preconditions to s 46 liability were satisfied81. Lee J accepted that this was so for intellectual property rights82. The exclusion by s 51 of various types of conduct from Pt IV is limited in relation to intellectual property rights. In deciding whether Pt IV has been contravened, anything specified in, or specifically authorised by, a Commonwealth Act must be disregarded – but not an Act relating to patents, trademarks, designs or copyrights: s 51(1)(a). A contravention of a provision of Pt IV is not to be taken to have been committed by various licences and other contracts, arrangements or understandings relating to patents, registered designs, copyright and other rights, and trademarks – but this does not apply to ss 46, 46A and 48: s 51(3). The legislative scheme contemplates that whether the conduct is refusal to supply intellectual property, or the supply of it on particular conditions, s 46 can be attracted83. The fact that s 46 can apply to intellectual property rights, and hence to the market power which they can give, suggests that it can apply to the use of market power derived from other property rights not specifically mentioned in the Act. It follows that, provided the notoriously difficult task of satisfying the criteria of liability can be carried out, s 46 can be used to create access regimes, and that s 2B is not to be read down as if it could not. Finally, there is no contradiction in legislation which contains Pt IIIA and also contains s 2B and s 46. It is possible to imagine circumstances similar to those of the present case in which PAWA would not be vulnerable to a s 46 challenge, but would eventually have to provide access, either under an effective access regime devised by the Northern Territory or under a regime developed pursuant to Pt IIIA. Further, in cases where there is a contravention of s 46, it is possible that curial relief, sought speedily, might be obtained before completion NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR Queensland Wire Industries Pty Ltd v Broken Hill Proprietary Co Ltd (1989) 167 CLR 177. NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR 399 at 404 [10] last sentence ("necessarily"). Examples of how this could arise under the 1974 form of s 46 are given by Gummow, "Abuse of Monopoly: Industrial Property and Trade Practices Control", (1976) 7 Sydney Law Review 339 at 345-348. McHugh ACJ Callinan of the somewhat elaborate arbitral, review and appellate procedures provided for in Pt IIIA. Argument advanced by Western Australia. The Solicitor-General for Western Australia supported PAWA's submission that it was not carrying on a business because it did not supply access to its infrastructure by reference to Bass v Permanent Trustee Co Ltd84. He said it showed that activities "engaged in solely term traditional governmental purposes" stood outside "businesses"85. The passage relied upon was dealing with a question entirely different from the present – that of accessorial liability. In any event, it does not support PAWA's construction, since PAWA's conduct in this case was not "engaged in solely for traditional governmental purposes"86. the for Conclusion on s 2B. The reasons set out above have rejected PAWA's contentions that NT Power's conduct at the trial prevents it from relying on the pleadings; have concluded that even if NT Power cannot rely on the pleadings, the conduct of PAWA that is alleged to have contravened s 46 was in the course of carrying on a business; and have rejected PAWA's proposed construction of s 2B. The result is that it is open to the Court to consider whether PAWA's refusal of access to NT Power contained in the letter of 26 August 1998 contravened s 46. Was PAWA's refusal to supply transmission and distribution services within s 2C(1)(b)? Before considering s 46, however, it is necessary to examine the trial judge's reasoning on s 2C(1)(b), PAWA's criticism of it, and the weaknesses in PAWA's construction of s 2C(1)(b). The trial judge's reasoning. Section 2C(1)(b) relevantly provides: "For the purposes of sections 2A and 2B, the following do not amount to carrying on a business: (1999) 198 CLR 334. (1999) 198 CLR 334 at 349 [23] per Gleeson CJ, Gaudron, McHugh, Gummow, See below at [133]-[150]. McHugh ACJ Callinan granting, refusing to grant, revoking, suspending or varying licences (whether or not they are subject to conditions) …" Section 2C(3) defines "licence" as meaning "a licence that allows the licensee to supply goods or services". The trial judge held that the refusal of access did not fall within s 2C(1)(b). The Full Court majority did not deal with the matter. PAWA contends that the word "licence" in its ordinary meaning is broad – a permission or consent − and that it should be given that broad meaning in s 2C(1)(b). Hence, refusal of access was refusal of a licence. The trial judge held that the licence granted on 26 June 1998 under s 25 of the Electricity Act (NT) ("the Electricity Act") was a licence as defined in s 2C(3)87. That licence permitted NT Power to sell goods, namely electricity, which s 27(1) of that Act would not otherwise have permitted it to sell88. NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 481 at 545 [289]. The Electricity Act was repealed by the Electricity Reform Act (NT). At the relevant time, s 25 of the Electricity Act provided in part: "(1) The Authority may appoint a person who is a party to an agreement with the Authority as a licensee to generate, store, reticulate and sell electricity for use in an area. (2) A licensee may sell electricity in accordance with the terms of his agreement with the Authority." NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 481 at 570 [383]. Section 27 provided in part: "(1) Subject to this Act, a person shall not sell electricity. Penalty: $2,000. (3) A licensee may sell electricity subject to the terms of the agreement entered into between him and the Authority." Section 29(1) provided: "A person shall not - (Footnote continues on next page) McHugh ACJ Callinan However, the PAWA officers responsible for granting the licence did not perceive any grounds on which PAWA could refuse it. They saw its grant as irrelevant to the question whether NT Power would be able to supply any electricity. For them, the question of granting the licence was clearly distinct from the question of allowing access to infrastructure89. The trial judge held that while NT Power needed the consent of PAWA to provide transmission and distribution services to NT Power, that was not a "licence" within the meaning of s 2C(1)(b)90: "Although 'licence' and the expressions 'consent' may be interchangeable in certain circumstances (see for example the definition of 'licence' in the Macquarie Concise Dictionary, 1988, p 555 and the discussion of Sheppard, Spender and Gummow JJ on the significance of the wording in s 2(1) of the Copyright Act 1912 (Cth) in Computermate Products (Aust) Pty Ltd v Ozi-soft Pty Ltd91), in my view the term 'licence' in s 2C(1)(b) … carries the sense of a formal authorisation by a public authority to sell goods or services. … [T]he expression in its context conveys something more than 'consent'. Section 2C(1)(b) is expressed in terms applicable to formal regulatory processes, including the reference to granting, revoking and suspending licences. The wide meaning of 'licence' for which PAWA contends is one which does not lie readily with those processes. That wide meaning would also, in the case of 'government' businesses, apply to many if not most routine decisions or processes in the operations of those businesses so as to substantially water use, consume, waste or divert electricity generated by the Authority or a licensee; or use any electrical installation, equipment, apparatus or thing owned by the Authority or a licensee, except with the consent of the Authority or a licensee. Penalty: $1,000." NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR (1988) 83 ALR 492 at 494-495. McHugh ACJ Callinan down the apparent scope of s 2B. The regulatory functions of PAWA in the licensing of persons to generate, store, reticulate and sell electricity is provided in s 25 of the Electricity Act." PAWA's criticisms of the trial judge. PAWA claimed, first, that though the trial judge eventually arrived at a narrow statutory meaning, he recognised that the word "licence" is of wide import. In fact, he did not. Though he said that the expressions "licence" and "consent" may be interchangeable in certain circumstances, and referred to a case in the very different field of the copyright owner who licenses importation of infringing copies, he concentrated on the terms of s 2C(1)(b) in their context. Further, in its ordinary meaning the word "licence" is not of particularly wide import. The Oxford English Dictionary92 gives various meanings, only two of which are relevant to the present context. One is: "2. a. A formal, usually a printed or written permission from a constituted authority to do something, e.g. to marry, to print or publish a book, to preach, to carry on some trade, etc.; a permit. … b. The document embodying such a permission. …" The other is: "1. a. Liberty (to do something), leave, permission. Now somewhat rare." The Macquarie Dictionary93 does not give the latter meaning, but includes the following: "1. formal permission or leave to do or not to do something. 2. formal permission from a constituted authority to do something, as to carry on some business or profession, to be released from gaol for part of one's sentence under specific restrictions, etc. 3. a certificate of such permission; an official permit. 4. freedom of action, speech, thought, etc., permitted or conceded. …" 2nd ed (1989), vol 3 at 890. McHugh ACJ Callinan It is unlikely that s 2C(1)(b) bears meaning 1.a. in the Oxford English Dictionary or meaning 4 in the Macquarie Dictionary. The first is rare. The second is inappropriate. And the definition in s 2C(3) commences with the words "a licence", suggesting something narrower and more formal than "leave" or "freedom" or something which has been "permitted or conceded". Secondly, PAWA submitted that it was wrong to narrow the definition of "licence" in s 2C(1)(b) on the ground that a wider meaning would limit s 2B. However, the background to the enactment of s 2B and equivalent provisions in the States and Territories suggests that s 2B was not intended to be narrow in meaning, which in turn suggests that the exceptions to s 2B in s 2C were not intended to have the effect of giving it a narrow meaning. While it may not be fatal to a suggested construction that it has that effect, it is a reason for examining it critically. Thirdly, PAWA submitted: "If Parliament intended to restrict the meaning of 'licence' with reference to the formality attaching to its grant, or with reference to requirements going beyond the consent or permission given by the licence, it would have done so, and it would have spelt out the formality which was required, and it would have spelt out the matters beyond consent which were required." The trial judge did not say that the licence required "matters beyond consent": he merely said that the word conveys the need for some formality in the expression of that consent. That some formality is called for is indicated by the word "a" before "licence" in the definition, as noted above. It is also indicated by the use of the words "granting" and "suspending" in s 2C(1)(b). This language is more apt for formal licences than for informal consents. However, there is force in the contention that since neither s 2C(1)(b) nor s 2C(3) defines the degree of formality, the construction found by the trial judge has an unattractive degree of uncertainty. Fourthly, PAWA contended that, if greater formality were required, NT Power needed its consent to the use of PAWA's infrastructure, not only because PAWA owned it but also because s 29(1)(b) of the Electricity Act made it an offence to use it without PAWA's consent94. PAWA argued that, as the trial judge recognised, complex technical, pricing and backup power issues would See note 88 above. McHugh ACJ Callinan have to be resolved before PAWA could be expected to consent. PAWA submitted: "The statutory requirement for PAWA as regulator to give its consent before the infrastructure can lawfully be used satisfies any need for formality, and the complex issues to be determined as a condition of any consent shows that something more than mere consent was required." However, the trial judge saw s 29(1) consent as different from PAWA's consent to NT Power using its infrastructure to transport electricity. He said95: "[Section 29(1)] contemplates that PAWA may consent to the use of its infrastructure, but … it appears … more to be a provision directed to prevent tampering with any part of PAWA's infrastructure than with the wider question of general access to PAWA's infrastructure." "[I]n my judgment s 29 is concerned with protecting PAWA or a licensee from misuse of its infrastructure or misappropriation or misuse of electricity (for which s 29(1)(a) provides). Section 29 creates an offence for such conduct, and fixes a penalty. The consent for which it provides is no doubt intended to encompass a variety of circumstances in which PAWA or a licensee might wish to permit persons to have access to infrastructure, such as repair or maintenance, measurement, upgrading and the like. It is also of significance that it protects both PAWA and licensees, and provides for PAWA or a licensee to give the consent contemplated." That approach is sound. It is also difficult to see how the reference to consent in s 29(1)(b) of the Electricity Act can cast light on the meaning of "licence" in s 2C(1)(b) of the Act. In any event, s 29(1)(b) consent was not necessary. NT Power did not want to use any "electrical installation" or "equipment" owned by PAWA: it was not seeking any physical access by its employees to PAWA's assets. NT Power only wanted PAWA to take electricity from it, receive it into its system, and manage its transmission and distribution. NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR McHugh ACJ Callinan It is true that the style in which PAWA conducted negotiations up to 26 August 1998 makes it difficult to infer precisely what form any favourable response to NT Power's request would have taken. But the complexity of the issues under discussion between the parties made it likely that it would have been sufficiently detailed to meet any requirement of formality. Fundamental flaws in PAWA's argument. However, PAWA would fail on the s 2C issue, even if all its contentions just considered were sound. This is so for two reasons. First, s 2C(1)(b) provides only that the mere doing of the enumerated acts in relation to licences does not amount to carrying on a business. Similarly, the other paragraphs of s 2C(1) provide that carrying on a business is not to be found in merely imposing or collecting taxes, levies or fees for licences (s 2C(1)(a)), or merely carrying out an intra-governmental transaction (s 2C(1)(c)), or merely compulsorily acquiring primary products (s 2C(1)(d)). It is not alleged that PAWA was carrying on a business merely because it granted, revoked, suspended or varied licences. If the only basis on which PAWA had been said to carry on a business was that it entered into agreements with persons whom it then appointed as licensees to generate, store, reticulate and sell electricity within the meaning of s 25(1) of the Electricity Act, it would fall within the exception in s 2C(1)(b). But PAWA was said to carry on a business for other, quite different reasons. Hence, it is irrelevant whether PAWA's refusal to make infrastructure services available to NT Power was a refusal to grant a licence. Secondly, a fundamental difficulty in PAWA's position is that the definition of "licence" in s 2C(3) requires that it "allows the licensee to supply goods or services". The trial judge accordingly construed "licence" as an "authorisation … to sell goods or services"97. It is common for the word "licence" to be used in the sense employed by Latham CJ in Federal Commissioner of Taxation v United Aircraft Corporation98: NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR (1943) 68 CLR 525 at 533. See also Reid v Moreland Timber Co Pty Ltd (1946) 73 CLR 1 at 5 per Latham CJ; Banks v Transport Regulation Board (Vic) (1968) 119 CLR 222 at 230 per Barwick CJ. McHugh ACJ Callinan "A licence provides an excuse for an act which would otherwise be unlawful as, for example, an entry upon a person's land, or the infringement of a patent or copyright. It is an authority to do something which would otherwise be wrongful or illegal or inoperative." In Latham CJ's examples, the illegality that a licence prevents is the infringement of some private right, whether it is created by the common law or by enactment. But in other areas, the illegality is a wrong against the State. It is found in conduct without a licence, contrary to an enactment – carrying on some profession (like medicine or law), or some trade or business (like selling liquor or drugs, or erecting buildings, or dealing in second-hand goods), or some pastime (like shooting, fishing, owning a pet or, in former times, watching television), or some common activity (like driving). The licence referred to in s 2C(1)(b) is of this latter kind. NT Power had been authorised or allowed to supply goods (namely electricity) by the licence of 26 June 1998. If NT Power had not received that licence, s 27(1) of the Electricity Act would have made it unlawful for NT Power to supply electricity; however, with the licence it was entirely lawful for it to do so, since the licence gave it an excuse or authority to do so. NT Power's difficulty thereafter was not that it was not allowed to supply electricity. Rather its difficulty was that it could not supply it. It could not take advantage of its pre-existing licence to supply electricity unless PAWA provided it with transmission and distribution services that only PAWA could provide. What NT Power was seeking from PAWA up to and after 26 August 1998 was not a permission to sell electricity which, if not granted, would cause NT Power to act unlawfully. It was seeking the services that only PAWA could supply. Conclusion on s 2C(1)(b). It follows that even if PAWA's criticisms of the trial judge's reasoning are sound, it cannot rely on s 2C(1)(b): PAWA's carrying on of a business did not rest only on the grant of licences and the permission NT Power sought from PAWA was not a permission to sell goods or services. Contravention of s 46: did PAWA take advantage of market power for a prohibited purpose? Was there an Electricity Infrastructure Market or an Electricity Carriage Market? It is now necessary to turn to the many arguments which PAWA advanced against the contention that it had taken advantage of market power for purposes proscribed by s 46(1). The first of them was that there was no relevant market because of the absence of transactions in the Electricity Infrastructure Market or the Electricity Carriage Market. This argument rested on the supposed McHugh ACJ Callinan fact that PAWA had never sought to supply any goods or services in those markets, since it only used the infrastructure for its own purposes and had not granted access to others. Further, PAWA submitted that it lacked capacity to engage in transactions without a direction from the Minister under s 16 of the PAWA Act, and this it never had. While NT Power's allegation that these two markets existed was put in issue by PAWA99, two other markets were admitted – the Electricity Transmission Market and the Electricity Distribution Market. PAWA's economist favoured those two markets; NT Power's economist favoured the two markets put in issue100. The trial judge said that it was not necessary to choose between these opinions, since resolution of the dispute made no difference to the outcome101: "Whichever view is adopted, … the power of PAWA in the market or markets is the same and the conduct in which it engaged in relation to the market or markets is the same. In addition, the reason or reasons why it engaged in that conduct is the same. There is no evidence to suggest that PAWA treated the question of access to its infrastructure differently in relation to what [PAWA's economist] called its transmission assets from the way in which it treated the question of access to the assets which [PAWA's economist] described as its distribution assets." In the light of that statement, if the "no transaction" point were good, it would mean that there was no Electricity Transmission Market and no Electricity Distribution Market either. Yet PAWA saw no difficulty in admitting those markets, despite the absence of transactions in them. The Defence put the markets alleged in issue to the limited extent indicated102, but did not plead that they were not markets because of an absence of transactions in them. There was a duty to do so, since the point, if not specifically pleaded, might have taken NT Power by surprise: Federal Court At [58] above. 100 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 101 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 102 At [58] above. McHugh ACJ Callinan Rules, O 11 r 10(b). Indeed, NT Power argued in this Court, in written submissions filed before oral argument was conducted, that it was taken by surprise: "In the light of the defence, there was no occasion to explore with either expert the impact on their opinions of any alleged absence of transactions or the significance on that question of the fact that, on any view, NT Transmission provided transmission services to PAWA along the 132 kV line. Further, in the light of the pleading admission and the evidence of the experts there was no occasion to explore by way of evidence the extent to which one could conclude that there were transactions in the Territory involving the provision of distribution services along distribution lines owned by [persons] other than PAWA (eg the 22 kV lines connecting the Mt Todd PS). The previously unforeshadowed 'formal' submission in final address after the conclusion of the evidence that there was no relevant market because of an absence of transactions was objected to then and now as outside the pleading." Those submissions were not contradicted by PAWA in its submissions. It follows that PAWA ought not to be allowed to rely on the submission under consideration. Further, PAWA's contention that there were no transactions at all in any Electricity Infrastructure Market or Electricity Carriage Market is incorrect. This is because of the events referred to in the above quotation – what were, in substance, transmission services were provided to PAWA along the 132 kV line by NT Transmission after a process of purchase and resale. The trial judge found103: "NT Transmission uses the 132 kV line to transmit electricity to and from PAWA under a series of electricity sale and purchase agreements. PAWA purchases from, and sells to, NT Transmission electricity at supply points and redelivery points along the 132 kV line." Even if, contrary to the last point, there were no infrastructure transactions at all, there was the potential for them, and, according to three justices of this 103 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR McHugh ACJ Callinan Court in Queensland Wire Industries Pty Ltd v Broken Hill Proprietary Co Ltd, in the words of Deane J104: "[A] market can exist if there be the potential for close competition even though none in fact exists. A market will continue to exist even though dealings in it be temporarily dormant or suspended … [and even if] there is no supplier of, nor trade in, … goods at a given time – because, for example, one party is unwilling to enter any transaction at the price or on the conditions set by the other." "It would be a curious consequence if the offering by B.H.P. of a limited supply of [a particular steel product known as] Y-bar established a market for that product but the withholding of supply altogether meant that there was no market." Here, there was the potential for dealings in transmission and distribution services: NT Power was willing to acquire them, and during the months of communications up to 26 August 1998, PAWA abstained from refusing to supply them. PAWA submitted that the observations of the three justices in the Queensland Wire case were only dicta, because the case turned not on a Y-bar market but on a wider steel products market in which there were many transactions. PAWA also submitted that the dicta should not be followed. Even if they are dicta, it would be wrong not to follow them without much fuller argument on the point in a case with a less unsatisfactory procedural background. PAWA's contention that the absence of any direction from the Minister for Essential Services under s 16 of the PAWA Act precluded the existence of a market is invalid. Markets cannot appear and disappear at the whim of the Minister for Essential Services. In any event, PAWA could trade as it wished until a contrary ministerial direction was received. Section 46(4)(c) and market power. PAWA next submitted that it had not contravened s 46 because it lacked market power in the Electricity Infrastructure Market and the Electricity Carriage Market106. It said that it lacked that power (1989) 167 CLR 177 at 196; see also Dawson J at 200. 105 Queensland Wire Industries Pty Ltd v Broken Hill Proprietary Co Ltd (1989) 167 CLR 177 at 211-212. Section 46(1) is set out at note 3 above. The balance of s 46 relevantly provides: (Footnote continues on next page) McHugh ACJ Callinan because s 46(4)(c) required it to have that power as "a supplier" of goods or services in that market, and it did not in fact supply any goods or services. PAWA's power was said to derive only from "its position as regulator and its ownership of the infrastructure". Apart from the terms of s 46(4)(c), PAWA relied on Verizon Communications Inc v Law Offices of Curtis V Trinko, LLP107. If this s 46(4)(c) point were to be relied on, it should have been pleaded. It was not. Nor was it taken at the trial, or in the Full Court, or in the Notice of Contention. It was first taken in submissions in this Court. The trial judge found, as indicated above, that it did not matter whether there was an Electricity Infrastructure Market or an Electricity Carriage Market, or whether there were instead an Electricity Distribution Market and an Electricity Transmission Market. The trial judge in his analysis referred to108: "(3) In determining for the purposes of this section the degree of power that a body corporate or bodies corporate has or have in a market, the Court shall have regard to the extent to which the conduct of the body corporate or of any of those bodies corporate in that market is constrained by the conduct of: competitors, or potential competitors, of the body corporate or of any of those bodies corporate in that market; or persons to whom or from whom the body corporate or any of those bodies corporate supplies or acquires goods or services in that market. (4) In this section: a reference to power is a reference to market power; a reference to a market is a reference to a market for goods or services; and a reference to power in relation to, or to conduct in, a market is a reference to power, or to conduct, in that market either as a supplier or as an acquirer of goods or services in that market." 72 USLW 4114 (2004). 108 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR McHugh ACJ Callinan "the market or markets for supply of services for the transport of electricity along PAWA's infrastructure, including its transmission and distribution network, as 'the market'." For reasons which are unchallengeable, and unchallenged save on the s 46(4)(c) point and other limited points, the trial judge concluded that PAWA had a substantial degree of power in the "market"109. In these circumstances, the s 46(4)(c) point cannot be raised now. However, even if it is open to PAWA to raise the s 46(4)(c) point, the point can be bypassed because, for reasons given above110, PAWA's conduct can be analysed as taking advantage of market power in the market for the sale of electricity which arose from its control of the infrastructure for the purpose of injuring NT Power in that market. There is no doubt that PAWA supplied electricity in the market for the sale of electricity, and had market power in it. In any event, the point is unsound. First, s 46(4)(c), in its reference to "conduct", cannot assist in the construction of s 46(1), which is focussed on the "power" of the defendant. The word "conduct" is rather the focus of s 46(3) which deals with the capacity of the conduct of others to constrain the conduct of the defendant. PAWA argued that "conduct" ought to be construed generally to cover the behaviour described in s 46(1), but this gives no weight to the contrast between "power" in s 46(1) and "conduct" in s 46(3). Secondly, in its reference to "power", s 46(4)(c) does not require that a corporation be an active supplier to have market power. It simply identifies the character or capacity in which the corporation has whatever market power it has. It provides that the relevant power is supplier power or acquirer power – not the power which large financial institutions have, for example. If s 46(4)(c) had the meaning alleged by PAWA, s 46 would cease to operate in what is generally regarded as one of its primary fields of operation – refusal by a corporation to supply goods or services. A corporation which at all times refused to supply never was an active supplier, and a corporation which once supplied but then refused to supply has ceased to be an active supplier. But the fact that it never was, or ceased to be, an active supplier does not prevent it having market power. That conclusion derives some support from the legislative history. 109 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR McHugh ACJ Callinan In 1974, s 46(1) provided: "A corporation that is in a position substantially to control a market for goods or services shall not take advantage of the power in relation to that market that it has by virtue of being in that position – to eliminate or substantially to damage a competitor in that market or in another market; to prevent the entry of a person into that market or into another market; or to deter or prevent a person from engaging in competitive behaviour in that market or in another market." There was no equivalent to s 46(4). In 1977, s 46 was amended111, and thereafter s 46(1) took the following form: "A corporation that is in a position substantially to control a market for goods or services shall not take advantage of the power in relation to that market that it has by virtue of being in that position for the purpose of [the results described in pars (a)-(c) of s 46(1) in its 1974 form]." A new s 46(4) was also introduced: "A reference in this section to substantially controlling a market for goods or services shall be construed as a reference to substantially controlling such a market either as a supplier or as an acquirer of goods or services in that market." The change to s 46(1) was recommended by the Swanson Committee so as to make it plain that the prohibition depended on the existence of one of the 111 By s 25 of the Trade Practices Amendment Act 1977 (Cth). McHugh ACJ Callinan particular purposes112. The Swanson Committee did not recommend the new s 46(4). Nothing was said about it in the Minister's Second Reading Speech113. In 1986, s 46 was amended and, inter alia, sub-ss (1)-(4) assumed their present form114. The Explanatory Memorandum stated that the amendments were "designed to lower the threshold test for determining whether the section is applicable"115. The definition of power in relation to or conduct in a market in s 46(4)(c) corresponds mutatis mutandis with the definition of controlling a market for goods or services in the 1977 form of s 46(4). The Explanatory Memorandum said nothing about it. The 1977 form of s 46(4) made it plain that it was directed to the character of participation in the market. It would be strange if in the course of enacting amendments designed to lower the threshold test, Parliament increased it in one respect by re-enacting s 46(4) as the new s 46(4)(c) with a focus different from its former focus on the character of participation in the market. If, contrary to the foregoing, the point could be taken now and had merit, it would not avail PAWA, because its conduct can also be analysed as the taking advantage of market power which, for reasons given above, existed in the Electricity Sale Market. In that market PAWA made very many sales. It was not entirely clear whether PAWA was relying on Verizon Communications Inc v Law Offices of Curtis V Trinko, LLP as an aid to the construction of s 46(4)(c) or as an aid to the construction of s 46 generally. In either event, it is not an authority which compels or influences the result in this case. Section 46 is in different terms from §2 of the Sherman Act 1890116. Section 2 is backed by the sanction of imprisonment; s 46 is not. Section 2 requires "the willful acquisition or maintenance" of monopoly power117 – a test Swanson Report at 40 [6.9]. 113 Australia, House of Representatives, Parliamentary Debates (Hansard), 8 December 1976 at 3531-3534. 114 By s 17 of the Trade Practices Revision Act 1986 (Cth). 115 Australia, House of Representatives, Explanatory Memorandum to the Trade Practices Revision Bill 1986 (Cth) at [35]. I5 USC §2 (2001). 72 USLW 4114 at 4116 (2004), citing United States v Grinnell Corp 384 US McHugh ACJ Callinan which is entirely different from and stricter than that in s 46118. Verizon's case was decided on factual circumstances arising in an industry – telephonic communications – which was subject to intense federal regulation; in particular, as the United States Supreme Court said, the regulating legislation had "extensive provision for access" and this made it "unnecessary to impose a judicial doctrine of forced access"119. Part IIIA of the Act cannot be treated as a rough analogue of the United States legislative regime permitting access because of the radically different position flowing from the preservation by s 44ZZNA of the independent operation of s 46. Taking advantage of proprietary rights, not market power? PAWA's next argument was that its conduct was to be characterised, not as taking advantage of market power, but only as taking advantage of its proprietary rights. PAWA contended that it was entitled, as owner of the infrastructure assets, to decline to consent to the use of them by others. That overstates the matter: PAWA was not asked to deliver its assets into the hands of NT Power's employees but merely to receive and transmit, via its infrastructure, electricity generated by NT Power. PAWA relied on the following passage in Dowling v Dalgety Australia Ltd, in which the owners of saleyards declined to permit the applicant auctioneer to conduct livestock sales at the saleyards120: "[T]he ownership of the land upon which the Goondiwindi Saleyards are erected and the rights which flow from that ownership and from membership of the Association are rights which may themselves give rise to or cause a degree of market power to come into existence. But the conduct of the respondents in choosing to exercise their rights the way they did could not be said to be conduct that they would be unlikely to engage in or could not afford for commercial reasons to engage in, if they Some of the difficulties in relying on §2 cases have been described in Queensland Wire Industries Pty Ltd v Broken Hill Proprietary Co Ltd (1987) 17 FCR 211 at 220-222 per Bowen CJ, Morling and Gummow JJ and Eastern Express Pty Ltd v General Newspapers Pty Ltd (1992) 35 FCR 43 at 70-72 per Lockhart and Gummow JJ; cf Boral Besser Masonry Ltd v Australian Competition and Consumer Commission (2003) 77 ALJR 623 at 646-647 [160] per Gaudron, Gummow and Hayne JJ; 195 ALR 609 at 640. 72 USLW 4114 at 4117 (2004). The legislative regime is analysed at 4116. (1992) 34 FCR 109 at 145-146. McHugh ACJ Callinan were operating in a competitive market (I have assumed for this purpose that they are not). The respondents have not used or taken advantage of market power. The respondents are not in the business of granting licences or leases of saleyards. They are in the business of providing livestock selling services. … They have declined to make available to Mr Dowling a valuable asset of theirs to advantage him as a competitor. In my opinion, they have not taken advantage of their market power for a substantial purpose of deterring or preventing Mr Dowling from engaging in competitive conduct in the relevant market." When that passage is read in context, it does not support PAWA. The case is distinguishable. In Dowling's case, none of the respondents had a substantial degree of power in the market, because there were no significant entry barriers, and the conduct of each respondent was constrained by its competitors and customers121. In the present case, as already noted, the trial judge found that PAWA did have a substantial degree of power in the market122. However, on the contrary assumption that the respondents in Dowling's case were not operating in a competitive market, and on the assumption that their proprietary rights were capable of creating market power, Lockhart J reached two conclusions. The first was that the respondents were not acting for any substantial purpose which was proscribed123. The second was reached in the passage quoted above – that the conduct of the respondents was not conduct that they would be unlikely to engage in, or could not afford for commercial reasons to engage in, had the market been competitive, and hence that they were not taking advantage of market power. But, in the present case, PAWA did take advantage of market power, because it was only by virtue of its control of the market or markets for the supply of services for the transport of electricity along its infrastructure, including its transmission and distribution network, and the absence of other suppliers, that PAWA could in a commercial sense withhold access to its infrastructure; if PAWA had been operating in a competitive market for the supply of access services, it would be very unlikely that it would have been able to stand by and allow a competitor to supply access services124. 121 Dowling v Dalgety Australia Ltd (1992) 34 FCR 109 at 141-142. 122 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 123 Dowling v Dalgety Australia Ltd (1992) 34 FCR 109 at 143. 124 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR McHugh ACJ Callinan Further, to suggest that there is a distinction between taking advantage of market power and taking advantage of property rights is to suggest a false dichotomy, which lacks any basis in the language of s 46. As already discussed, property rights can be a source of market power attracting liability under s 46125 and intellectual property rights are often a very clear source of market power. In short, Dowling v Dalgety Australia Ltd is not authority for any general proposition that a property owner who declines to permit competitors to use the property is immune from s 46. That proposition is, in any event, intrinsically unsound. Was a direction given under s 16 of the PAWA Act? PAWA's next submission was directed against two propositions: that it had taken advantage of market power and that it had a prohibited purpose. The submission rested on the contention that the Minister for Essential Services had given it a direction under s 16 of the PAWA Act126. The trial judge found that the Minister had given a s 16 direction127; Finkelstein J found that he had not128. See [85] above. Section 5 provided: "The Authority shall consist of the Chief Executive Officer". Section 6(1) provided: "The powers and functions of the Authority under this or any other Act shall be exercised and performed by the Chief Executive Officer." Section 16 provided: "The Authority, in the exercising of its powers and the performance of its functions, is subject to the directions of the Minister." 127 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 128 NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR McHugh ACJ Callinan When the letter of demand from NT Power's solicitors dated 17 August 1998 was received by the Chief Executive Officer of PAWA, a copy was sent to the Minister for Essential Services. The solicitor for PAWA, Mr Noonan, was asked to consider what the response of the Northern Territory Government should be. Mr Noonan advised, by letter of 20 August 1998, that PAWA had no legal obligation to provide access to its network; although challenges were possible, no legal proceeding was likely to succeed in the short term. The letter concluded: "We advise that you have the following options:- authorise us to send the attached reply to [NT Power's] solicitors, advise the PAWA Minister to direct PAWA not to enter into any arrangements pending the Scoping Study report concerning, inter alia, third party access to PAWA's network. On balance, option (a) is recommended if the political imperatives prevent option (b)." The advice in option (b) was probably advice to issue a s 16 direction. The draft letter referred to in option (a) did not refer to any s 16 direction. On 21 August 1998, Mr Gardner, Chief Executive Officer of PAWA, and Mr Henry, Acting Under Treasurer, sent what Finkelstein J called a "briefing note" to the Minister for Essential Services and the Treasurer. The briefing note had three annexures – a letter of 20 August 1998 from Merrill Lynch and Fay Richwhite advising that a decision not be taken; Mr Noonan's letter of 20 August 1998; and his draft reply to the letter sent on 17 August 1998 by the solicitors for NT Power. The briefing note began: "It is recommended that you:- agree that PAWA should defer the establishment of access arrangements … until the outcome of the PAWA Review [ie the "Scoping Study"] is decided by Cabinet, but continue the technical background work to develop an appropriate access regime for the Territory; and agree that James Noonan and Associates, acting as legal advisers to [the] Government in the PAWA Review, be authorised to respond to the legal representative of [NT Power], in accordance with the attached draft response." McHugh ACJ Callinan The draft response was that which Mr Noonan had attached as part of option (a) at the end of his 20 August 1998 letter. There was space at the end of the 21 August 1998 briefing note to indicate whether the Minister and the Treasurer agreed or disagreed with the recommendation. They agreed. The trial judge held that though the acceptance of recommendation (a) was not expressed as a s 16 direction, it "had that status"129: "There is no other procedure established under the PAWA Act by which the minister could control the operations of PAWA. As a matter of practice, as the communications between PAWA and the minister demonstrate, the procedure of a minute from the chief executive officer and his response by endorsement on that minute was the normal means by which the minister (where he considered it appropriate) gave directions under s 16 of the PAWA Act. There is no evidence to indicate any other means by which directions under s 16 were given." Finkelstein J disagreed. He said that the recommendation was to adopt Mr Noonan's first and preferred option – to send the letter he had drafted. He denied the trial judge's statement that communications between the Minister and PAWA in the form of the briefing note were the normal means by which s 16 directions were given. He accepted that briefing notes were a means by which the Minister made known his views as to how the powers and functions of PAWA should be exercised130: "But that is a far cry from giving a direction which, if ignored, could be enforced by action brought in the name of the Attorney-General and could result in the removal from office of the Chief Executive [Officer]. In the ordinary course of events it would be very unusual for a minister to make use of a power such as s 16, if his or her wishes could be put into effect by less coercive steps. The judge seems to have been of opinion that whenever the Minister desired to have PAWA act in accordance with his wishes, a direction to that effect was given. That opinion is not supported by the evidence. In any event, past practices are not always a reliable guide to future conduct, as this case demonstrates. For whatever may 129 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 130 NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR McHugh ACJ Callinan have been the position in the past, the Minister did not intend to give a direction under s 16, having accepted the advice of Mr Noonan that a different course should be followed." The reference in the last sentence is to the fact that Mr Noonan recommended option (a) (sending Mr Noonan's draft letter) if the political imperatives prevented option (b) (advising the Minister to give a s 16 direction). PAWA has not demonstrated error in the reasoning of Finkelstein J. PAWA took this Court to some oral evidence of Mr Gardner in an endeavour to counter Finkelstein J's conclusion that the Minister's desire to have PAWA act as he wished was not always conveyed by direction. That oral evidence was vague, was undermined by other evidence, and, in any event, did not falsify Finkelstein J's conclusion. The PAWA Act does not stipulate that s 16 "directions" are to take any particular form, and the Court was not taken to any other legislation which did. Even if Mr Gardner's evidence establishes that he thought he had received a s 16 direction in August 1998, that does not prove that he did. Everything depends on the terms of the briefing note: no other possible "direction" was relied on. But it is not possible to infer from the briefing note that any direction was given. The acceptance of the recommendation in the briefing note was too vague to amount to a s 16 direction. It did not refer to s 16, yet citation of the source of power could be a crucial matter in the event of later political or forensic controversy about whether any directions had been given or obeyed – for Mr Gardner had a duty to obey them131. It did not speak in the language of command or mandate or instruction – it did not direct. If a s 16 direction had been given, was s 46 contravened? PAWA submitted that if (contrary to the conclusion just arrived at) the acceptance of the recommendation in the briefing note was a s 16 direction, it could not be said that PAWA had taken advantage of its market power, because the Minister had directed the refusal of access. PAWA further submitted that its conduct was therefore not for a proscribed purpose, but rather for the purpose of complying with the Minister's direction. PAWA additionally submitted that if the Minister's purpose was relevant, that purpose was establishing an access regime in fulfilment of the Northern Territory's obligations under the Competition Section 22(1) of the Public Sector Employment and Management Act (NT) provided: "… the Chief Executive Officer is subject to the direction of the appropriate Minister." McHugh ACJ Callinan Principles Agreement in the belief that to provide earlier access would disadvantage consumers and damage competition. None of these contentions succeeded before the trial judge, Branson J or Although, as PAWA conceded in argument, there was no legal impediment to Mr Gardner deciding the question of access for himself, the trial judge accepted Mr Gardner's evidence that the question of access was ultimately for the Northern Territory Government132. Even if PAWA received a s 16 direction from the Minister and acted in accordance with it, in deciding what PAWA did, it is necessary to look at the conduct and the mental state of both the Minister and the Chief Executive Officer. What PAWA did in response to a direction of the Minister was conduct of PAWA, and the Minister's accompanying mental state was PAWA's mental state. That would be so, even if a s 16 direction came without any solicitation by or warning to the Chief Executive Officer of PAWA. It is so a fortiori where, as here, the Chief Executive Officer and the Acting Under Treasurer solicited the approval of the recommendation which PAWA said constitutes the s 16 direction. The trial judge found that the mental state of those who advised the Minister to recommend as he did, and of the Minister himself133, was to deter or prevent NT Power from participating in the transmission or distribution markets and in the Electricity Supply Market (in which it was likely that its prices would undercut PAWA's) until the Northern Territory introduced an access regime. For that conclusion there was ample evidence. The conclusion was not affected by the fact that the reason why the Minister and his advisers reached this mental state was the desire, by establishing an access regime providing effective competition134, to encourage genuine and efficient competition in the medium to 132 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 133 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 134 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR McHugh ACJ Callinan long term135. PAWA submitted that, on a purposive construction, s 46 should be read so as to negate the existence of a proscribed purpose in the short term, if there exists a longer term, pro-competitive purpose. The trial judge rightly held that this was an impermissible gloss on s 46136. Section 46 does not permit the drawing of a distinction between short-term anti-competitive purposes (here keeping NT Power out of the market) and long-term pro-competitive objectives (establishment of an access regime), and does not permit the former to be nullified or excused by the latter. Nor is it relevant that, in PAWA's submission, entry by NT Power might cause such losses to PAWA that it would cease to subsidise services to remote communities. If authorisation were available for s 46 conduct, reasoning of that kind might be relevant in an application to the Australian Competition and Consumer Commission for authorisation under s 88, at least so far as the purposes were likely to mature into effects generating public benefits. But, subject to the operation of s 46(6)137, s 88 does not make authorisation available for s 46 conduct, and in any event authorisation is not a matter for the courts. In fact, the "relatively short-term" character of the anti- competitive purposes was far from being de minimis: it took the Northern Territory until 1 April 2000 to introduce its access regime, that access regime provided for only staggered and limited access to the infrastructure, and, so far as the evidence goes, the access regime has not yet been declared an effective access regime. The alternative route of a Pt IIIA access regime can thus take years, even with the best will of all persons participating. The legislation does not contemplate that immunity from s 46 can be found in a desire to bring about what the Under Treasurer called "sensible competition"138. In truth, that expression is a reference to the process by which 135 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 136 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR Section 46(6) provides: "This section does not prevent a corporation from engaging in conduct that does not constitute a contravention of any of the following sections, namely, sections 45, 45B, 47 and 50, by reason that an authorization is in force or by reason of the operation of section 93." 138 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR McHugh ACJ Callinan an inefficient monopolist sought to give itself time to reorganise its affairs by obstructing emerging competition. "Competition by its very nature is deliberate and ruthless. Competitors jockey for sales, the more effective competitors injuring the less effective by taking sales away."139 Competition is also dynamic. It tends to create conditions of constant turbulence. It generates instability. These circumstances the emulation and striving which produce competitive benefits. Paternalistic control from a monopolist is antithetical to competition, and a construction of s 46 which permitted it, even if only in the short term, is inconsistent with the structure of the section and the legislation as a whole. trigger Erroneous inference from purpose to exercise of market power? At this point, PAWA's submissions appeared to visit upon the trial judge a list of errors made in other cases construing s 46. These contentions all fail. The first of them was that the trial judge's conclusion was vitiated by the error of inferring too readily an exercise of market power from a proscribed purpose140. That is not so. The findings of the trial judge on market power141, and on exercise of that power142, were arrived at earlier than, and quite independently of, his findings about purpose143. So, incidentally, were those of Finkelstein J144. 139 Queensland Wire Industries Pty Ltd v Broken Hill Proprietary Co Ltd (1989) 167 CLR 177 at 191 per Mason CJ and Wilson J. See also Boral Besser Masonry Ltd v Australian Competition and Consumer Commission (2003) 77 ALJR 623 at 646-647 [160] per Gaudron, Gummow and Hayne JJ; 195 ALR 140 Melway Publishing Pty Ltd v Robert Hicks Pty Ltd (2001) 205 CLR 1 at 18-19 [31] per Gleeson CJ, Gummow, Hayne and Callinan JJ; Boral Besser Masonry Ltd v Australian Competition and Consumer Commission (2003) 77 ALJR 623 at 651 [181], 653 [194]-[195] per Gaudron, Gummow and Hayne JJ; 195 ALR 141 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 142 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 143 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 144 NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR 399 at 450-451 [180] (taking advantage), 451-452 [184]-[186] (purpose). McHugh ACJ Callinan Confusion between purpose and effect? PAWA next submitted that the trial judge failed to appreciate that s 46 is not concerned with the effect of conduct but with the purpose of it. This error was said to lie in passages culminating in the statement that a substantial purpose of PAWA was to deter or prevent NT Power from participating in the market or markets for the supply of services for the transport of electricity along PAWA's infrastructure or the Electricity Supply Market until an access regime had been introduced, and that that "was the particular means by which the ultimate desired end was, in part, to be achieved"145. PAWA submitted that the exclusion of NT Power was not the means for achieving long-term competition through an access regime but merely an incidental effect of it. This submission has two flaws. First, it directly contradicts PAWA's submission at the trial, which was that its "purpose in refusing access to its infrastructure … was to enhance competition, and … the refusal of access was a means to that end "146. Secondly, it ignores the trial judge's findings that PAWA was of the view that147: "greater competitive advantages would be achieved by delaying NT Power's access to the electricity supply market by declining to provide it with services in the market until an access regime [was] introduced … [E]arly, and therefore preferential, access to NT Power would or could disadvantage consumers in the electricity supply market as they might enter supply contracts with NT Power at prices above those which might be negotiated in circumstances where there was competitive tendering in a 'level playing field'. The 'level playing field', and therefore the ideal competition environment, would only be reached when PAWA had had a sufficient time to restructure to overcome its inefficiencies and when the tariff structure had been revised to avoid cross-subsidisation. Early access granted to NT Power would, in addition, further disadvantage PAWA because NT Power might 'cherry pick' the larger consumers leaving 145 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 146 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 147 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR McHugh ACJ Callinan PAWA with its inefficient cost structure but with diminished revenue and the ongoing obligation of servicing the smaller customers and those in remote localities. In other words, it would have to supply that segment of the electricity supply market which required greater expense to service." Confusion between existence of market power and exercise of market power. PAWA further criticised the trial judge for making a connection too readily between the existence of market power and its exercise, and for thereby ignoring or rejecting alternative sources of power. The alternative sources of power to which PAWA referred were its statutory powers in carrying out its "regulatory function", and its statutory duty to comply with s 16 directions from a Minister in the Northern Territory Government (which was under a duty imposed by the Competition Principles Agreement to carry out structural reform of its monopolies). But all the trial judge did was to point out that if there had been other suppliers of infrastructure services it would not have been possible for PAWA to withhold access to its infrastructure, and it would not have done so148. This criticism creates too sharp a bifurcation, for which there is little support in the PAWA Act, between PAWA's "commercial role" and its "regulatory" role. While, on the one hand, the trial judge found that PAWA desired to delay access so as to enable a more effective competition regime to be introduced in the future, that was not only because of concern about consumer interests: PAWA was conscious of its own competitive inefficiencies, the risk to its revenues of allowing access and the consequential risk of suffering losses, and the risk that granting early access would reduce its sale value on privatisation149. Its regulatory powers could be used to help its commercial position; the weaknesses and strengths of its commercial position could affect the success with which it used its regulatory powers150. The trial judge's conclusion that PAWA could not have used its regulatory powers under s 16 if it had faced competition in the transmission and distribution services markets, has not been shown to be wrong. PAWA contended that the distinction advanced between its regulatory and commercial roles was well-recognised by authority151. It is not necessary to 148 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 149 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 150 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 151 Plume v Federal Airports Corporation (1997) ATPR ¶41-589 at 44,132 per O'Loughlin J; Stirling Harbour Services Pty Ltd v Bunbury Port Authority (Footnote continues on next page) McHugh ACJ Callinan examine the correctness on their facts of the authorities on which PAWA relied; the suggested distinction in its application to the present facts does not assist PAWA. Failure to make correct assumptions about a competitive market. Finally, PAWA contended that the trial judge erred in finding that it took advantage of its market power because, had there been other suppliers of infrastructure services, it would not have been possible for PAWA to withhold access to its infrastructure. PAWA contended that the trial judge did not attempt to consider whether PAWA could have refused access to its infrastructure had it lacked market power. On the other hand, PAWA criticised Finkelstein J for making assumptions about what would happen in a competitive market, one of which was that there was "at least one other firm with similar infrastructure" to that of PAWA. This assumption was said to take "the analysis beyond the realms of reality". Finally, PAWA drew attention to the following statement in Melway Publishing Pty Ltd v Robert Hicks Pty Ltd152: "To ask how a firm would behave if it lacked a substantial degree of power in a market, for the purpose of making a judgment as to whether it is taking advantage of its market power, involves a process of economic analysis which, if it can be undertaken with sufficient cogency, is consistent with the purpose of s 46. But the cogency of the analysis may depend upon the assumptions that are thought to be required by s 46." That statement does not say that unrealistic assumptions may not be made. The assumption on which the reasoning of four members of the Court in Queensland Wire Industries Pty Ltd v Broken Hill Proprietary Co Ltd153 proceeded – that BHP lacked market power and was operating in a competitive market – was highly unrealistic, but no later case has held that it was wrong to make it. The statement in Melway Publishing Pty Ltd v Robert Hicks Pty Ltd was only urging the need for cogent analysis on the basis of the assumptions, and (2000) ATPR ¶41-752 at 40,734 [124] per French J; aff'd Stirling Harbour Services Pty Ltd v Bunbury Port Authority (2000) ATPR ¶41-783 at 41,277 [72] per Burchett and Hely JJ. (2001) 205 CLR 1 at 23-24 [52] per Gleeson CJ, Gummow, Hayne and (1989) 167 CLR 177 at 192 per Mason CJ and Wilson J, 202 per Dawson J; see also at 216 per Toohey J. McHugh ACJ Callinan the reasoning that follows the quoted passage demonstrates that cogent analysis did not, in that case, support a conclusion that advantage had been taken of market power. PAWA also asked why, if Finkelstein J were prepared to assume another firm with infrastructure competing with PAWA's, it should not also be supposed that the Government would use its regulatory powers to exclude NT Power? One answer is: "Because the Government had ample powers to adopt the course proposed in 1998, but it chose not to do so." And, whether the assumption that there was competing infrastructure is retained or removed, the use of "regulatory powers" simply to vindicate the self-interest – even the short-term self-interest – of the regulator, would be likely to create unacceptable political risks, a possibility which Mr Noonan foresaw in his advice of 20 August 1998. If PAWA's criticisms were sound, it would be very difficult ever to demonstrate that a firm, whose monopoly power depends on infrastructure which it is, in practice, very difficult to duplicate, had taken advantage of the market power which its control of that infrastructure gave it. It can be necessary, in assessing what would happen in competitive conditions, to make assumptions which are not only contrary to the present fact of uncompetitive conditions, but which would be unlikely to be realised if the monopolist were left free to operate as it wished. But s 46 and other provisions of Pt IV were introduced in order to stop monopolists being entirely free to act as they wish. If the difficulties in making assumptions were to prevent them from being made, possessors of market power that was hard to erode would be shielded from the Act. That would defeat its purpose. If, as PAWA urges, the assumption that an alternative infrastructure was available is not made, the most realistic assumption to be made about a market in which PAWA would not have a substantial degree of power is a market in which PAWA was subject to a legislatively created duty to give immediate access. On that assumption, PAWA would not have refused access, which demonstrates that in the actual world of 1998 it took advantage of market power, since it was only the assumed legislation that forestalled the existence of market power. Finkelstein J also adopted154 what he saw as an alternative approach – that of Deane J (Dawson J concurring) in Queensland Wire Industries Pty Ltd v 154 NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR McHugh ACJ Callinan Broken Hill Proprietary Co Ltd155. In Melway Publishing Pty Ltd v Robert Hicks Pty Ltd that approach was described without disapproval in the following way156: "Deane J saw the case as one in which the identification of the purpose for which BHP was refusing to supply QWI led directly to the conclusion that BHP was taking advantage of its market power. That was because the nature of the purpose was such that, in the circumstances of that case, it could not have been achieved by the conduct impugned (a refusal to supply) had it not been for the existence of the market power. In a competitive market, a refusal to supply QWI with Y-bar would not have prevented QWI from becoming a manufacturer or wholesaler of star pickets. QWI could have obtained supplies from some other manufacturer of Y-bar. It was only BHP's market power which meant that its refusal to supply was capable of achieving what was found to be its purpose." That reasoning is applicable here. PAWA's decision to refuse access to infrastructure had the purpose of excluding NT Power from the market, and that purpose could not have been achieved by its refusal of access to infrastructure had it not been for PAWA's market power. It was a decision, said the trial judge, "made in the appreciation of the existence of that market power, and of the capacity to exercise that market power to decline access to its infrastructure"157. PAWA did not direct any argument against that part of Finkelstein J's reasoning, and it is sound. Alternatives available to the Northern Territory Government. At times in argument before this Court there were suggestions that it was wrong that the Act should have a deleterious impact on PAWA's activities. PAWA had a duty to ensure electricity supply to the whole of the Territory, and it was not concerned merely with making a profit. In contrast, NT Power might have been able to deal only with the customers who were easiest to service. If NT Power succeeded, it might leave PAWA with undue costs burdens and an insufficient revenue stream in relation to supply of electricity to remote areas. Considerations of this kind do not demonstrate an absurd or harsh result compelling a construction of the legislation different from that which would (1989) 167 CLR 177 at 197-198. (2001) 205 CLR 1 at 17 [28] per Gleeson CJ, Gummow, Hayne and Callinan JJ. 157 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR McHugh ACJ Callinan otherwise be arrived at. If the Northern Territory Government had wanted to preserve PAWA's immunity from s 46 of the Act, or cl 46 of the Competition Code, it had ample means of doing so. Provided the conditions referred to in ss 51(1C)(a) and (e) of the Act were complied with, and provided the Commonwealth did not prevent this course by regulations under s 51(1C)(f), it could have enacted legislation pursuant to s 51(1)(d) of the Act158. That legislation could also have effected a specific partial repeal of cl 51. And it was open to the Northern Territory Government to seek to introduce an effective access regime much faster than it actually did. Conclusions on s 46. Consideration of PAWA's arguments has led to the conclusions, despite the fact that PAWA did not supply access to its infrastructure to others, that there were transmission/distribution markets and that PAWA had a substantial degree of power in them; that the Minister did not give any s 16 direction to refuse NT Power access on 26 August 1998; that even if he had, that does not prevent a finding that PAWA took advantage of its market power for proscribed purposes; that the trial judge did not err in applying s 46 to the facts he found; and that any adverse consequences caused by the application of s 46 to PAWA are not reasons for adopting a narrower construction of the section. Section 46 and Gasgo It is now necessary to turn to the case against the second respondent, Gasgo. The nature of the case and the trial judge's reasoning will be set out, before considering whether Gasgo is part of the Northern Territory Government, and whether Gasgo's conduct is protected by "derivative Crown immunity". Section 51(1)(d) of the Act provides: "In deciding whether a person has contravened this Part, the following must be disregarded: anything done in the Northern Territory, if the thing is specified in, and specifically authorised by: an enactment as defined in section 4 of the Northern Territory (Self-Government) Act 1978; or regulations made under such an enactment …" McHugh ACJ Callinan Gasgo's role in the trial. Gas is the cheapest fuel for generating electricity in the Northern Territory. Gasgo is a company in which PAWA beneficially holds all the issued shares. It has entered a long-term gas purchase contract ("the Mereenie Agreement") with certain suppliers ("the Mereenie Suppliers"). It has habitually sold the gas supplied to NT Gas Pty Ltd ("NT Gas"), which on-sells to PAWA. Clause 2.26 of the Mereenie Agreement gives Gasgo a pre-emptive right in relation to the sale of gas by the suppliers to customers other than Gasgo, at the price offered to the third party. NT Power required gas from the suppliers for its generator, and requested that Gasgo give an undertaking that it would not insist on its pre-emptive rights. Gasgo declined to give that undertaking, and NT Power contends that that is a breach of s 46. At the trial, Gasgo argued three points. First, it argued, and the trial judge denied, that it was "entitled to Crown immunity as an emanation of the Crown"159. Secondly, Gasgo argued, and the trial judge agreed, that it was entitled to "derivative Crown immunity", because the interests of the Northern Territory would be prejudiced by the application to Gasgo of s 46. The prejudice claimed was "financial prejudice", namely that if Gasgo could not exercise the pre- emptive right in cl 2.26, there would be a consequential need for it or PAWA to seek additional supplies of gas in a competitive market where those supplies might be constrained by available reserves of deliverable quantities160. The trial judge said that the relief sought against Gasgo included an order that it forego its cl 2.26 right of pre-emption, and the effect of that order "would be to dismantle the security of gas supply which the Northern Territory Government procured through NTEC and [Gasgo] in 1985"161. The trial judge held that the relief sought against Gasgo162: 159 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 160 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 161 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 162 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR McHugh ACJ Callinan "would … have the effect of exposing PAWA, and indirectly the Northern Territory Government, to having to renegotiate through [Gasgo] for supplies of gas beyond those presently contracted even though … its demand for gas is increasing as the electricity usage in the Northern Territory increases. The value to the Northern Territory Government of PAWA's securing through [Gasgo] the benefit of clause 2.26 … would be lost." The third issue before the trial judge concerned s 89(2) of the Reform Act, which provides: "Existing contracts, and things done to give effect to existing contracts, are to be disregarded to the same extent that they would have been disregarded if the amendments made by Division 1 of this Part … had not been made." Section 89(5) defines "existing contract" as meaning "a contract that was made before the cut-off date", which is 19 August 1994. The Mereenie Agreement was made in 1985, well before the cut-off date. Among the amendments in Pt 5 Div 1 of the Reform Act was the insertion of s 2B. The trial judge concluded that if the amendment inserting s 2B had not been made, the relief sought by NT Power would have prejudiced PAWA, an instrumentality of the Crown, so that cl 2.26, and things done to give effect to it, were to be disregarded in ascertaining whether the Act had been contravened163. A majority of the Full Federal Court reached the same conclusion for reasons which need not be set out.164 Is Gasgo part of the Northern Territory Government? The first key question is whether Gasgo is bound by s 46 on the ground that it is, as par 45A of the Defence alleges, "an emanation of the Crown in right of the Northern Territory". Gasgo relied on the fact that PAWA was its sole beneficial owner; that article 44a of its articles of association provides that a general meeting could be called at any time by the "Northern Territory of Australia or any agency thereof or by any shareholder who holds any share on behalf of the Territory or 163 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 164 NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR 399 at 407 [29] per Lee J, 423-425 [101]-[107] per Branson J. McHugh ACJ Callinan any agency thereof"; and that article 69 provided that the Minister of Mines and Energy had the power to appoint or remove any person as director without the necessity of a general meeting. Gasgo pointed to the fact that, on 27 June 1985, Cabinet directed NTEC to acquire Gasgo; and that on the same day it approved entry by Gasgo into the Mereenie Agreement. Gasgo noted that its payment obligations under the Mereenie Agreement were unconditionally guaranteed by the Northern Territory Government. Further, on 28 June 1985 a director of Gasgo wrote the following letter to the NTEC: "I acknowledge that although … [NTEC] is not a party to the Gas Purchase Agreements, Gasgo has the benefit of certain rights under the Gas Purchase Agreements on behalf of and for the benefit of NTEC, including in the event of a default by the Producers in their obligation to supply gas to Gasgo. On behalf of Gasgo, I acknowledge in the event that any of the said rights [become] exercisable, Gasgo will exercise consultation with NTEC and if NTEC so requests at any time, Gasgo will forthwith exercise those rights for and on behalf of NTEC." those rights only The Court was not taken to any of Gasgo's articles other than the two mentioned above, and only a handful of the articles are in evidence. It is unsatisfactory that an inquiry into whether a corporation is "an emanation of the Crown" should have to be undertaken in such circumstances where its status does not depend on any specific statute. However, it seems from those articles which are in evidence that they were composed by taking a standard form of company articles and adding in article 44a and part of article 69. Since Gasgo bore the burden of establishing whatever factual matters were necessary to make good its claim to immunity, this evidentiary deficiency must damage its case. Another unsatisfactory aspect of the question whether Gasgo is "an emanation of the Crown in right of the Northern Territory" is the way the issue is framed. To some extent the terms of the question flow from the language of s 2B. However, the use of the expression "the Crown" to refer to the government McHugh ACJ Callinan has been much criticised165. So has the expression "emanation of the Crown"166. Preference has been given to the use of the expression "the Crown as executive"167. In this context, the expression "the Crown" is used in the third of the senses discussed by three members of this Court in Sue v Hill168: "Thirdly, the term 'the Crown' identifies what Lord Penzance … called 'the Government'169, being the executive as distinct from the legislative branch of government, represented by the Ministry and the administrative bureaucracy which attends to its business." And, as this Court has recently pointed out, the language of the question is "inappropriate and potentially misleading when the issue is whether the legislation of one polity in the federation applies to another"170. This Court also said171: "Where the legislative provisions in question are concerned with the regulation of the conduct of persons or individuals, it will often be more appropriate to ask whether it was intended that they should regulate the conduct of the members, servants and agents of the executive government of the polity concerned, rather than whether they bind the Crown in one or other of its capacities." "The Mersey Docks and Harbour Board" Trustees v Cameron (1865) 11 HLC 443 at 508 per Lord Cranworth [11 ER 1405 at 1430]; Town Investments Ltd v Department of the Environment [1978] AC 359 at 381 per Lord Diplock, 400 per Lord Simon of Glaisdale. International Railway Co v Niagara Parks Commission [1941] AC 328 at 342-343 per Luxmoore LJ; Bank voor Handel en Scheepvaart NV v Slatford [1953] 1 QB 248 at 284 per Sir Raymond Evershed MR. 167 M v Home Office [1994] 1 AC 377 at 395 per Lord Templeman. (1999) 199 CLR 462 at 499 [87] per Gleeson CJ, Gummow and Hayne JJ. 169 Dixon v London Small Arms Co Ltd (1876) 1 App Cas 632 at 651. 170 Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 347 [17] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ. 171 Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 347 [18] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ. McHugh ACJ Callinan This approach corresponds with what this Court, as long ago as 1904, called "the modern sense of the rule", namely that "the Executive Government of the State is not bound by Statute unless that intention is apparent"172. And it corresponds with the statement of Kitto J five decades later that the "Crown normally means the Sovereign considered as the central government of the Commonwealth or a State"173. Can Gasgo then be characterised as part of the Government of the Northern Territory? Although acquired specifically for the purpose of entering the Mereenie Agreement and others like it, Gasgo was a trading corporation. Its articles of association took the form, apparently, of standard trading company articles. Its shares were owned by PAWA. It sold gas to NT Gas, the largest shareholder in which was AGL Pipelines (NT) Pty Ltd ("AGL"). NT Gas, which constructed and has a lease over the relevant gas pipeline from its owners, a bank consortium, in turn sold gas to PAWA. It was not suggested that either AGL or NT Gas could be regarded as "emanations of the Crown" or parts of the Northern Territory Government. This is damaging to Gasgo's reliance on the orchestration by the Northern Territory Government in June 1985 of arrangements to obtain "security of gas supply … through NTEC and [Gasgo]"174. It negates an inference which might otherwise be available. The interpolation of non- governmental entities in this contractual and physical chain of supply undermines the characterisation of the trading corporation Gasgo as part of the Northern Territory Government. There is nothing to suggest that the directors of Gasgo do not have the usual duties and functions of directors. There is nothing to suggest that the directors are under any duty to obey directions from PAWA or the Northern Territory Government, any more than directors of non-governmental companies are under any duty to obey directions from members of those companies. No doubt a failure to respond to indications of the Northern Territory Government's desires might lead to the removal of directors, whether by the Minister or by a meeting of shareholders, but the same is true of ordinary companies: directors tend to respond to expressions of shareholder will well before shareholders' meetings are called to remove the directors. The giving of 172 Roberts v Ahern (1904) 1 CLR 406 at 418 per Griffith CJ, Barton and 173 Wynyard Investments Pty Ltd v Commissioner for Railways (NSW) (1955) 93 CLR 376 at 393 per Kitto J. 174 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR McHugh ACJ Callinan guarantees by the Northern Territory Government is not an indication of an intention that Gasgo should have the immunities of the executive government from legislation, and nor is the agreement of Gasgo to exercise certain rights in consultation with NTEC. Finally, as the trial judge pointed out, the utilisation of a body corporate incorporated under a general enactment for the incorporation of companies as the party contracting with the Mereenie Suppliers, rather than a body established by a particular statute, does not reveal an intention on the part of the Northern Territory Government that that body corporate should have its immunities175. Gasgo submitted that there is no reason why a body corporate established under a general enactment of that kind should be treated any differently from one established under its own statute. In some circumstances that may be true, save that it becomes harder to identify the necessary intention where a general enactment is relied on. It is not possible to find sufficient evidence of it here. Is Gasgo protected by "derivative Crown immunity"? The next issue is whether, at the time the Mereenie Agreement was entered into, Gasgo had "derivative Crown immunity". That expression is employed in par 45A(l) of the Defence. What appears to be involved is an extension of what, before Bropho v Western Australia176, was a rule of statutory construction that legislative provisions worded in general terms are prima facie inapplicable to the Crown. Denning LJ was of the view that this "immunity" could only be claimed by those "having Crown status"177. He would, however, have allowed for the class of case identified by Blackburn J in "The Mersey Docks and Harbour Board" Trustees v Cameron178. Kitto J in Wynyard Investments Pty Ltd v Commissioner for Railways (NSW) later identified this as179: 175 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR (1990) 171 CLR 1 at 15 per Mason CJ, Deane, Dawson, Toohey, Gaudron and 177 Bank voor Handel en Scheepvaart NV v Slatford [1953] 1 QB 248 at 293-294; the Court of Appeal's decision was reversed in Bank voor Handel en Scheepvaart NV v Administrator of Hungarian Property [1954] AC 584; cf Hogg and Monahan, Liability of the Crown, 3rd ed (2000) at 320. (1865) 11 HLC 443 at 465 [11 ER 1405 at 1413]. (1955) 93 CLR 376 at 394. McHugh ACJ Callinan "an anomalous class of cases where a provision creating a liability by reference to the ownership or occupation of property would, in its application in respect of certain kinds of property, impose a burden upon the performance of functions which, though not performed by servants or agents of the Crown, are looked upon by the law as performed for the Crown". In Wynyard Investments Pty Ltd v Commissioner for Railways (NSW), Kitto J also identified another two classes of case. The first involves cases where180: "a provision, if applied to a particular individual or corporation, would adversely affect the exercise of an authority which he or it possesses as a servant or agent of the Crown to perform some function so that in law it is performed by the Crown itself". The second class consists of cases181: "in which a provision, if applied to a particular individual or corporation, would adversely affect some proprietary right or interest of the Crown, legal equitable or statutory". Gasgo sought to bring itself within that last category, but, as will appear, this would require the expansion of the ambit of that category. Such an expansion would be at odds with what, since Bropho v Western Australia, is the eclipse of the rule of statutory construction rendering general terms prima facie inapplicable to the Crown itself. A more accurate way of putting the issue which Gasgo raises accords with what was said by Kitto J in Wynyard Investments Pty Ltd v Commissioner for Railways (NSW). This is to ask whether s 46, in preventing enforcement of a clause in a contract between two parties, neither of whom is the Government, caused "some impairment of the existing legal situation of" the Northern Territory Government in this case182. The object, to adapt what was said by (1955) 93 CLR 376 at 394. (1955) 93 CLR 376 at 394. 182 Wynyard Investments Pty Ltd v Commissioner for Railways (NSW) (1955) 93 CLR 376 at 393 per Kitto J. McHugh ACJ Callinan Kitto J, is to ascertain whether the application of s 46 to Gasgo "would be, for a legal reason, an interference with some right, interest, power, authority, privilege, immunity or purpose belonging or appertaining" to the Government183. More recently, this Court said that the interference to be looked for is a "divesting" of "property, rights, interests or prerogatives"184 belonging to the Government. The better view is that the principle applies to proprietary, contractual and other legal rights and interests and not otherwise, notwithstanding that it has been said to extend to "arrangements or understandings"185. That phrase was used by Mason and Jacobs JJ in Bradken Consolidated Ltd v Broken Hill Proprietary Co Ltd186 but, as appears below, requires further consideration. Gasgo advanced two arguments. The first was that "Gasgo's participation in the series of agreements entered into in 1985 was at the express direction of and on behalf of the Northern Territory Government and is clearly a part of an arrangement or understanding of the Northern Territory Government in the sense spoken of in" Bradken Consolidated Ltd v Broken Hill Proprietary Co Ltd by Mason and Jacobs JJ. What Mason and Jacobs JJ were speaking of in that case was an allegation of a "contract, arrangement or understanding" contrary to s 45 of the Act, pursuant to which a BHP company was to finance the building of a railway line by the Commissioner of Railways for Queensland (part of the Queensland Government) on the condition that equipment be purchased exclusively from BHP. The "contract, arrangement or understanding" of which Mason and Jacobs JJ spoke was different from anything arising in the present circumstances, because one of the parties to it was the Government187. Gasgo is not part of the Northern Territory Government. If the words of Mason and 183 Wynyard Investments Pty Ltd v Commissioner for Railways (NSW) (1955) 93 CLR 376 at 396. 184 Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 354 [42] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ. 185 Bradken Consolidated Ltd v Broken Hill Proprietary Co Ltd (1979) 145 CLR 107 at 137 per Mason and Jacobs JJ; see also Bank voor Handel en Scheepvaart NV v Administrator of Hungarian Property [1954] AC 584 at 621, 624 per Lord Reid, 629 per Lord Tucker, 632 per Lord Asquith of Bishopstone. (1979) 145 CLR 107 at 137. (1979) 145 CLR 107 at 137: "The Commissioner … is an agent authority or instrumentality of the Crown stated by his incorporating statute to represent the Crown." McHugh ACJ Callinan Jacobs JJ were to be applicable here, it would be necessary to show a contract, arrangement or understanding to which not just Gasgo, but also PAWA or some other part of the Northern Territory Government, was a party. In the present case, there was only one contract between Gasgo and the Mereenie Suppliers; another contract between Gasgo and NT Gas; and contracts between NT Gas and PAWA. The only part of the Government involved was PAWA. Whatever the understandings between PAWA and Gasgo, the trial judge made no finding that there were any understandings between PAWA (or any other part of the Northern Territory Government) on the one hand and the Mereenie Suppliers on the other. Indeed, his judgment does not suggest that the argument under consideration was put. The second argument advanced was that which the trial judge accepted188, namely that the Government would be prejudiced if cl 2.26 were not enforceable. The prejudice found by the trial judge was that to the extent that gas bought by third parties could not be acquired by Gasgo, less would be sold to NT Gas and thence to PAWA. Gasgo would have to seek to enter further negotiations for replacement quantities. If it failed, or succeeded only by paying a higher price, PAWA would be worse off. But it would be worse off only in an indirect economic sense. No proprietary right or interest or contractual right or prerogative of the Northern Territory Government would be affected, for neither PAWA nor any other part of the Northern Territory Government have any such rights, interests or prerogatives as against the Mereenie Suppliers under the Gasgo frankly acknowledged that no legally enforceable interest of the Northern Territory Government was prejudiced, and that its only prejudice was financial. It bluntly invited this Court to extend the law. It submitted that "the consequences of being denied contractual rights or property rights are more often than not financial consequences. If that is so, what reason in logic is there for confining the prejudice to prejudices arising out of interference with contractual or property rights?" In strict logic, there may be no reason. But there is a standard distinction in many fields of law between the financial consequences of breaches of a person's legal rights, and the financial consequences that flow to a person independently of any breach of that person's legal rights. And the law allows wider recovery for financial losses flowing from injuries to a plaintiff's body, and injuries to land or chattels which a plaintiff owns, than it does for pure financial loss, unless that loss is the result of a broken contract. Where, contract apart, the law allows recovery of pure financial loss, it does so more freely for 188 Above at [158]. McHugh ACJ Callinan intentionally caused financial loss than negligently caused financial loss. Gasgo did not explain what precise test it advocated, why it should be adopted, or how it would fit in with the concerns underlying these principles. Gasgo did not explain why, if it could claim immunity from s 46, many non-governmental entities would not gain immunity from statutory obligations as long as it could be shown that there was some financial impact on the Government's position. Nor did it explain how that reliance could be reconciled with the intent of the statutes imposing those obligations. What is clear is that to apply "derivative Crown immunity" in favour of Gasgo would extend that immunity beyond any point the Australian authorities have so far reached. Gasgo did not advance any argument of sufficient merit to justify that extension. Some phrases in Bradken Consolidated Ltd v Broken Hill Proprietary Co Ltd were relied on to support an extensive construction, going well beyond prejudice to property rights, legal rights, legal interests or legal prerogatives189. But those words cannot be read as extending beyond the solution of the problem before the Court. The actual decision was only that where it was alleged that the Commissioner of Railways had entered into a contract, arrangement or understanding with BHP contrary to ss 45 or 47 of the Act, and where the Commissioner was not bound by ss 45 or 47, the Act could not apply to BHP either. That was because application of the Act would affect the Government's enjoyment of a direct consensual relationship between itself and a non- governmental party. If PAWA had entered into a contract with the Mereenie Suppliers, it would have fallen within the four corners of the decision in Bradken Consolidated Ltd v Broken Hill Proprietary Co Ltd. But PAWA was not a party to the Mereenie Agreement, and although PAWA is part of the Northern Territory Government, Gasgo is not. The factual circumstances are very different from those dealt with in Bradken Consolidated Ltd v Broken Hill Proprietary Co Ltd, and so is the problem for decision. That problem can only be answered favourably to Gasgo if Gasgo's request that the law be extended is acceded to. No satisfactory basis for acceding to it was advanced, and it should not be acceded to. The Solicitor-General for South Australia advanced an argument which was more specific than Gasgo's. He argued that among the relevant interests which could give rise to immunity were the interests which the Government has eg (1979) 145 CLR 107 at 124 per Gibbs ACJ ("prejudicial to the interests of the Crown" and "which would affect prejudicially the interests of the Crown"). McHugh ACJ Callinan in contracts other than those to which it is a party. He argued that if a statute affected one party's contractual rights in a manner which compromised that party's capacity to fulfil its obligations under another contract with the Government, an interest of the Government had been affected. The facts here would actually require the principle to be extended even beyond that submission: it would require the principle to be that if a statute affected the contractual rights of one non-governmental party (Gasgo) against other non-governmental parties (the Mereenie Suppliers) in a manner which compromised Gasgo's capacity to fulfil its obligations under a second contract with a non-governmental party (NT Gas) so as to compromise that latter party's capacity to supply gas to the government (PAWA), an interest of the government had been affected. The Solicitor-General for South Australia relied on In re Telephone Apparatus Manufacturers' Application190. The circumstances considered in that case are indeed the closest to the circumstances contemplated by the Solicitor- General's argument, though they are narrower than the circumstances of the present case. The case concerned two agreements. The first was the "Crown agreement". Eight manufacturers of telephone apparatus promised to supply apparatus in accordance with orders placed by the Postmaster-General (cl 2), and to establish a committee which was to appoint a secretary (cl 3(1)). The Postmaster-General was not to be concerned with the constitution of the committee (cl 3(2)). Clause 4(1) provided that the Postmaster- General was to notify the secretary of any orders which he or she proposed to place, and the committee was within fourteen days to inform the Postmaster- General of the contractors with which each of the orders was to be placed. If the committee did not so inform the Postmaster-General, the Postmaster-General was at liberty to place each order with whichever contractor he or she wished. The second agreement was the Telephone Apparatus Manufacturers' agreement ("the TAM agreement"). It provided for the allocation of orders received by the Postmaster-General under the Crown agreement by unanimous decision of the committee; failing that, orders were to be allocated according to the quota standing of the members, on the basis that the business was to be divided in equal shares. [1963] 1 WLR 463; [1963] 2 All ER 302. The Court of Appeal proceeding was an appeal from the decision of Wilberforce J in In re Telephone Apparatus Manufacturers' Application [1962] 1 WLR 596; [1962] 2 All ER 207. McHugh ACJ Callinan The English Court of Appeal held that if there were a duty to register the TAM agreement under the Restrictive Trade Practices Act 1956 (UK), s 6(1)(c), there would be a risk of a declaration by the Restrictive Practices Court that the TAM agreement was against the public interest. The legislation was held not to apply to the TAM agreement because that would have damaged the interests of the Crown. The decision can be viewed as proceeding on two alternative bases – a wide one and a narrow one. The first, wide, basis for the decision treated the two agreements as distinct: the striking down of the TAM agreement would make the Crown agreement almost wholly ineffective and deprive the Postmaster-General of the services of the committee. This first basis is questionable. Willmer LJ said that the Postmaster-General's "interests" would be prejudicially affected by the invalidity of the TAM agreement191, and Upjohn LJ said that the Crown's "rights and interests" would be prejudiced192. But the interests were only commercial interests: the legal position of the Postmaster-General was unimpaired. Harman LJ said that to interfere with the TAM agreement was "to frustrate in whole or in part the Crown agreement, and thus to interfere with the freedom of contract of the Crown"193. That "freedom" was not a legal right: the Crown and the manufacturers could have included within the Crown agreement any term of the TAM agreement they wished, but they chose not to. Willmer LJ said However, all three judges mentioned a second, narrower, basis for their decision. the agreements were "necessarily complementary", and though in separate documents, were not "really severable" but "hopelessly mixed up together"194. Harman LJ said that the agreements were "complementary" and "intimately connected"195. Upjohn LJ said that they were "complementary and must be read together"; and from the point of view of the contractors they constituted "one agreement"196. that [1963] 1 WLR 463 at 474-475; [1963] 2 All ER 302 at 308. [1963] 1 WLR 463 at 482; [1963] 2 All ER 302 at 313. [1963] 1 WLR 463 at 477; [1963] 2 All ER 302 at 310. [1963] 1 WLR 463 at 474; [1963] 2 All ER 302 at 308. [1963] 1 WLR 463 at 477; [1963] 2 All ER 302 at 310. [1963] 1 WLR 463 at 482; [1963] 2 All ER 302 at 313. McHugh ACJ Callinan It is this narrow basis which should be treated by Australian courts as the true ground of the decision. There was not one agreement to which the Crown was a party and another to which it was not a party, but one composite agreement to which it was a party. So viewed, the decision is not unlike the actual decision in Bradken Consolidated Ltd v Broken Hill Proprietary Co Ltd. However, as indicated above, that second ground for the decision is inapplicable here: it is not possible to analyse the transactions relating to the Mereenie Agreement as comprising a single, composite agreement. The Solicitor-General for South Australia submitted that In re Telephone Apparatus Manufacturers' Application was accepted in Bradken Consolidated Ltd v Broken Hill Proprietary Co Ltd, referred to in Bass v Permanent Trustee Co Ltd, and had not been doubted. But the crucial question is whether there is a decision of this Court which depends on the application of the reasoning underlying the first basis for the decision. In Bradken Consolidated Ltd v Broken Hill Proprietary Co Ltd, Gibbs ACJ said of In re Telephone Apparatus Manufacturers' Application only that the case before him was "a stronger one"197. Stephen J said that the Act would not apply directly to the Commissioner "but [would] also not apply so as to prejudice its interests when in contractual relationship with parties to whom the Act clearly applies or when otherwise interested in transactions affecting those parties (In re Telephone Apparatus Manufacturers' Application)"198. That is an approving reference to the case in its wider application, but one not necessary for the decision in Bradken Consolidated Ltd v Broken Hill Proprietary Co Ltd itself. Mason and Jacobs JJ said that in accordance with such authorities as In re Telephone Apparatus Manufacturers' Application, "the absence of an intention to bind the Crown in right of Queensland will not only exonerate it from the direct application of the statutory provisions but will also exonerate from the application of those provisions the contracts arrangements or understandings made by that Crown and the other parties thereto as well"199. The language of Mason and Jacobs JJ is adapted to the facts before them, and not to the facts of In re Telephone Apparatus Manufacturers' Application. Murphy J said that In re Telephone Apparatus Manufacturers' Application did not persuade him to accept the (1979) 145 CLR 107 at 124. (1979) 145 CLR 107 at 129 (footnote omitted). (1979) 145 CLR 107 at 138. McHugh ACJ Callinan contention that even if the Act bound the Commissioner, ss 45 and 47 were not applicable to the contract, arrangement or understanding before him200. Thus, apart from Stephen J, no justice in Bradken Consolidated Ltd v Broken Hill Proprietary Co Ltd approved the reasoning underlying the broad basis of In re Telephone Apparatus Manufacturers' Application. Also, and for several reasons, any approval was obiter. The issue in Bradken Consolidated Ltd v Broken Hill Proprietary Co Ltd was much narrower than the issue in In re Telephone Apparatus Manufacturers' Application. The latter case was only relied on in argument for the proposition underlying its narrow basis, namely that the immunity enjoyed by the Crown "extends to contracts arrangements or understandings made by the Crown with others"201. Its correctness was not argued by the parties, was not examined critically by the Court, and was not crucial to the outcome. This Court in Bass v Permanent Trustee Co Ltd202 quoted Stephen J's words set out above, but did not specifically consider their correctness because, for various reasons, it was unnecessary to do so203. Since the narrow basis of In re Telephone Apparatus Manufacturers' Application is not applicable here, since no decision of this Court depends on the application of the reasoning underlying the wider basis, since the correctness of that reasoning has not been demonstrated, and since it would have to be extended a further stage to apply to the present circumstances, the case does not assist Gasgo. (1979) 145 CLR 107 at 140. (1979) 145 CLR 107 at 109. (1999) 198 CLR 334 at 354 [41] per Gleeson CJ, Gaudron, McHugh, Gummow, (1999) 198 CLR 334 at 354 [41] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ. In re Telephone Apparatus Manufacturers' Application was assumed, without contrary argument, to be correct in F Sharkey & Co Pty Ltd v Fisher (No 2) (1980) 33 ALR 184 at 192 per Sheppard J and Woodlands v Permanent Trustee Co Ltd (1996) 68 FCR 213 at 229-231 per Wilcox, Burchett McHugh ACJ Callinan In Bradken Consolidated Ltd v Broken Hill Proprietary Co Ltd, there was mention204, without disapproval, of New Zealand cases205 in which it was held that regulations requiring building contractors to obtain a permit before commencing work pursuant to a contract with the Government, and to be carried out on the Government's land, did not apply because of their impact on the Government. The outcome in these cases is capable of explanation as falling within the decision in Bradken Consolidated Ltd v Broken Hill Proprietary Co Ltd: the statutory provisions had a direct impact on the Government's contractual rights. There is a more borderline case of a contract to which the Crown was not a party but under which the work was to be carried out on Crown land and paid for by the Crown206, but, again, the reference to this case without disapproval was not crucial to the reasoning in Bradken Consolidated Ltd v Broken Hill Proprietary Co Ltd. It follows that if s 2B had not been enacted, and the Mereenie Agreement were considered in the light of the law as it stood before 19 August 1994, there is no reason why s 46 would not have operated on the Agreement: it would not have been disregarded, and s 89(2) of the Reform Act has no application favourable to Gasgo207. (1979) 145 CLR 107 at 124 per Gibbs ACJ. 205 Doyle v Edwards (1898) 16 NZLR 572; Lower Hutt City v Attorney-General [1965] NZLR 65 at 75 per North P, 77-78 per Turner J, 81 per Hutchison J. 206 Wellington City Corporation v Victoria University of Wellington [1975] 2 NZLR 301 at 305 per Cooke J. 207 The Solicitor-General for South Australia advanced an argument based on the following words of the trial judge: "Gasgo on 28 June 1985 acknowledged … that it had the benefit of the several agreements 'for and on behalf of and for the benefit of' NTEC": NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 481 at 541 [270]. The argument was that the Government had an interest in Gasgo's contracts that would be protected from s 46. Gasgo did not plead or contend that the Government had any interest in the contract. Whether the letter of 28 June 1985 created in favour of NTEC or PAWA any contractual, trust or other equitable interest in the contract would turn on factual investigations not carried out at the trial, and the argument is thus not open for consideration. It should also be noted that it was not argued that to enforce cl 2.26 after the cut-off date – 19 August 1994 – is not to "give effect to" the 1985 contract. McHugh ACJ Callinan Conclusion. It follows that since Gasgo is not part of the Northern Territory Government, and since it could not claim "derivative Crown immunity" before 19 August 1994, its reliance on cl 2.26 of the Mereenie Agreement is open to scrutiny under s 46, and the proceedings must be returned to the trial judge for NT Power's allegations on this issue to be tried, together with a consideration of what, if any, remedies should be granted to NT Power in relation to the conduct of PAWA. The filing of written submissions after oral argument In the course of oral argument, on 10 March 2004, PAWA was given leave to file written submissions on certain questions208. PAWA did not avail itself of that leave for so long a period as two months: on 10 May 2004 a document was filed partly dealing with those questions and partly dealing with a matter in relation to which leave had not been granted. NT Power responded by a document dated 26 May 2004 on both points. This is unsatisfactory. It is impermissible to file further submissions without leave209, and this cannot be evaded by adding on to submissions filed with leave other material for which leave should have been obtained. The further submissions have contended that the Court should have no regard to two documents referred to near the end of NT Power's oral argument, and said that PAWA had no opportunity to deal with them. In fact, after NT Power's argument closed, counsel for PAWA advanced, as of right, a short oral submission, but did not seek leave to file any submission stating what the written submissions have since said. The documents in question have not been relied on in the reasoning set out above, but not for the reasons given in PAWA's written submissions. Orders On the assumption that NT Power's arguments have succeeded in substance, as they have, the only remaining issue between the parties was whether this Court should determine the costs of the trial. Since NT Power, though it ought to have won on all s 46 issues at trial, did lose on one issue relating to an implied contractual term which it has not pursued in this Court, the 208 Those discussed at [56]-[63] and [104]-[113] above. 209 Carr v Finance Corp of Australia Ltd (No 1) (1981) 147 CLR 246 at 258; Eastman v Director of Public Prosecutions (ACT) (2003) 214 CLR 318 at 329- McHugh ACJ Callinan submission of PAWA and Gasgo that the matter should be remitted to the trial judge is correct. PAWA and Gasgo did not resist an order that they pay the costs, not only in this Court but in the Full Federal Court. The following orders should be made: The appeal is allowed. The orders of the Full Federal Court made on 2 October 2002 are set aside. In lieu of the orders of the Full Federal Court made on 2 October 2002: (a) the appeal to the Full Federal Court is allowed; the respondents are to pay the costs of the appeal to the Full Federal Court. The respondents are to pay the costs of the appeal to this Court. The matter is remitted to Mansfield J for determination of the claim against the second respondent and consideration of the quantum of damages, costs of the trial, and the form of other relief. Kirby 195 KIRBY J. The appellant had a generator for the production of electricity. The first respondent, a statutory authority, created by the legislature of the Northern Territory of Australia, had legal functions to generate, distribute, supply and sell electricity throughout the Territory. Under its Act210, the first respondent had to perform its duties in accordance with any directions given to it by the relevant Minister. The facts and statutory context: The appellant from time to time sold electricity, manufactured by its generator, to the first respondent for use in the first respondent's grid. Pursuant to a series of electricity sale and purchase agreements, the first respondent bought the appellant's electricity at various supply points along the appellant's electricity transmission line211. It was not sold by the appellant direct to the first respondent's customers. With the exception of one 300 kilometre section of high-voltage transmission line running between Darwin and Katherine, the network of high-voltage wires used to distribute, supply and sell electricity in the Territory was owned by the first respondent. The first respondent refused a request by the appellant to allow it to use the first respondent's infrastructure and equipment to supply its electricity to selected consumers in the Darwin–Katherine area. The appellant wished to do so and considered that it could do so at a price cheaper than that charged by the first respondent. By law, the first respondent was responsible for the supply of electricity to the Territory. Inferentially, its price structure took into account, at least in a general way, the increasing costs of supplying electricity everywhere in the Territory and its duty to supply the product to remote consumers as well as those in the more populous areas of Darwin and Katherine. The first respondent was concerned that the appellant was seeking to use its facilities to "cherrypick" electricity consumers in Darwin and Katherine and that it was trying to do so before the first respondent had put in place an effective and proper arrangement for the effective "privatisation" of its business undertaking212, as part of the announced policy of the Territory Government. The Territory had, in fact, become generally committed to the policy of "privatisation" of governmental authorities engaged in business activities, such as 210 Power and Water Authority Act (NT) ("the Act"), s 16. 211 NT Power Generation Pty Ltd v Power and Water Authority (2001) 184 ALR 481 212 A final decision to privatise the first respondent had not been made by the Government. However, it was acknowledged by the Minister for Essential Services that if full privatisation did not ultimately occur, the first respondent would have to "become more competitive" within the market. Kirby the first respondent. This policy followed the Hilmer Report213 and a number of inter-governmental agreements between the Commonwealth, State and Territory governments designed to implement its main recommendations. In the Territory, those agreements were followed by legislation, by Ministerial protestations of commitment to competition policy, as well as by the annual report of the first respondent containing general statements to like effect. However, the Territory officials and the first respondent were concerned, when the appellant's request to use the first respondent's electricity distribution facilities was received, that the system of general "privatisation" should be eased into effect, including in respect of the first respondent. That concern led to a minute by officials to the Minister suggesting how this should be done. A question arises whether the Minister, in responding to this minute, gave a "direction" under the Act and whether this could bind the first respondent in the face of legislation binding on the Minister, the Government of the Territory and the first respondent, including s 46 of the Trade Practices Act 1974 (Cth) ("TPA") (see Waters v Public Transport Corporation214). I do not stay finally to resolve that contested point. However it may be, the first respondent refused to allow the appellant to use its infrastructure to supply electricity to the domestic electricity market in the Darwin–Katherine area. The decisions of the Federal Court: The appellant brought proceedings in the Federal Court of Australia against the first respondent claiming that the first respondent's refusal amounted to a breach of s 46(1) of the TPA and/or cl 46(1) of the Schedule version of Pt IV of the Competition Code, which, under s 5(1) of the Competition Policy Reform (Northern Territory) Act (NT), applied as a law of the Territory. Specifically, the appellant complained that the first respondent had a substantial degree of power in one or more of the markets for electricity supply, infrastructure, transmission and distribution, and, by use of its infrastructure, had "take[n] advantage" of that power for the "purpose" of preventing the entry of a person, namely the appellant, into that or "any other market" (see TPA, s 46(1)(b)). The "other market" alleged was the market for the supply and sale of electricity, including to consumers in the Darwin– Katherine area, which the appellant wished to enter. The primary judge in the Federal Court (Mansfield J) rejected the appellant's claim215. His judgment was upheld by a majority in the Full Court of 213 Australia, Independent Committee of Inquiry, National Competition Policy: Report by the Independent Committee of Inquiry, (1993) ("Hilmer Report"). 214 (1991) 173 CLR 349. 215 NT Power (2001) 184 ALR 481. Kirby the Federal Court216 (Lee and Branson JJ; Finkelstein J dissenting). Now, by special leave, the appellant has appealed to this Court. "Take advantage" and "purpose" in this case: In my view, the appeal should be dismissed. As I approach the case, it is a comparatively simple one. It turns essentially on the statutory notions of "take advantage of" and "purpose" appearing in s 46(1) of the TPA. I do not accept that it was not open to the governmental authorities in the Northern Territory, and the first respondent, acting under the Territory legislation, to delay the immediate commencement of a regime affording unimpeded access to the first respondent's electricity supply infrastructure. As such, this was a governmental decision concerning the use of the infrastructure of a public agency based on governmental reasons. It was informed by governmental conclusions about the gradual implementation of a new competition policy in public business-type authorities and the use of publicly funded resources for overall public benefit. It was not a purely commercial or business decision attracting the operation of the TPA. It had a clear governmental and a lawful political context which was both open to the Territory Government and its instrumentality, and understandable in the circumstances. It was probably the subject of a Ministerial "direction" under Territory law. But even if it was not, it was an available regulatory decision in the use of the electricity infrastructure of the Territory at the time the appellant demanded access to the first respondent's electricity distribution infrastructure. Even more importantly, I do not accept that the conduct of the appellant was anti-competitive within s 46 of the TPA. It is one thing, under that section, to redress the misuse of market power, including by the use of the resources and the property of a corporation to the marketing disadvantage of a would-be competitor. But s 46 of the TPA does not give the would-be competitor the right to demand and use, as its own, the property of another corporation. It merely prevents that other corporation from misuse of its power to prevent the entry of the other into the market217. Trade practices laws in Australia, and antitrust laws in the United States (from which the basic notions of our law derive), have not been interpreted to impose on an owner of private property a duty to make that owner's property available to a competitor. As the Supreme Court of the United States said of the Sherman Act in January 2004 in Verizon Communications Inc v Law Offices of Curtis V Trinko, LLP218: 216 NT Power Generation Pty Ltd v Power and Water Authority (2002) 122 FCR 399. 217 See Dowling v Dalgety Australia Ltd (1992) 34 FCR 109 at 144-145. 218 72 USLW 4114 at 4119 (2004). Kirby "The Sherman Act is indeed the 'Magna Carta of free enterprise', United States v Topco Associates, Inc219, but it does not give judges carte blanche to insist that a monopolist alter its way of doing business whenever some other approach might yield greater competition." If the first respondent had granted the appellant access to its infrastructure for the distribution and sale of electricity to some consumers it would doubtless have yielded a degree of greater competition in the Darwin–Katherine consumer market. However, just as the Supreme Court of the United States concluded that the complaint failed, so in my view does the complaint of the present appellant. And for essentially the same reasons. No doubt others will contrast the energetic deployment of trade practices law in the circumstances of this case, affecting a governmental corporation having governmental obligations to the public welfare, with the repeated refusal of this Court in recent times to do the same thing where the corporation concerned was private, successfully defending its market power against smaller private would-be competitors220. Order The appeal should be dismissed with costs. 219 405 US 596 at 610 (1972). 220 Rural Press Ltd v Australian Competition and Consumer Commission (2003) 78 ALJR 274 at 302 [138]; 203 ALR 217 at 256 and cases there cited. See also Zumbo, "The High Court's Rural Press decision: the end of s 46 as a deterrent against abuses of market power?", (2004) Trade Practices Law Journal 126 at 128.

HIGH COURT OF AUSTRALIA COMMISSIONER OF TAXATION OF THE COMMONWEALTH OF AUSTRALIA APPELLANT AND WORD INVESTMENTS LIMITED RESPONDENT Commissioner of Taxation of the Commonwealth of Australia v Word Investments Limited [2008] HCA 55 3 December 2008 ORDER Appeal dismissed with costs. On appeal from the Federal Court of Australia Representation R Merkel QC with R A Brett QC and D M Harding for the appellant (instructed by Australian Government Solicitor) J J Batrouney SC with M T Flynn for the respondent (instructed by Moores Legal) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Commissioner of Taxation of the Commonwealth of Australia v Word Investments Ltd Taxation – Income tax – Charities – Entity engaged in investment business and funeral business – Profits distributed to religious organisations – Whether entity exempt from income tax as "charitable institution" – Income Tax Assessment Act 1997 (Cth), ss 50-1, 50-5, 50-50, 50-52. Taxation – Income tax – "Charitable institution" – Whether sufficient for entity to have solely charitable purposes – Whether necessary for entity to engage in charitable activities directly – Whether necessary that distributed profits applied for charitable purposes. Taxation – Income tax – "Charitable institution" – Whether entity's objects in fact confined to charitable purposes. Taxation – Income Tax – Special condition for "charitable institution" income tax exemption – Income Tax Assessment Act 1997 (Cth), s 50-50(a) – Whether entity has physical presence in Australia – Whether entity "incurs its expenditure and pursues its objectives principally in Australia". Words and phrases – "charitable institution", "incurs its expenditure and pursues its objectives principally in Australia", "institution". Income Tax Assessment Act 1936 (Cth), s 23(e), (j). Income Tax Assessment Act 1997 (Cth), ss 50-1, 50-5, 50-50, 50-52, 50-55, GUMMOW, HAYNE, HEYDON AND CRENNAN JJ. The Commissioner of Taxation of the Commonwealth of Australia ("the Commissioner") refused to endorse Word Investments Ltd ("Word") as an income tax exempt charity. That decision was set aside by a senior member of the Administrative Appeals Tribunal (Mr B H Pascoe) in relation to the period from 1 July 20021. An appeal by the Commissioner to the Federal Court of Australia (Sundberg J) was dismissed; a cross-appeal by Word was allowed, so that Word's status as an income tax exempt charity was extended back to 1 July 20002. An appeal by the Commissioner from those orders to the Full Court of the Federal Court of Australia (Stone, Allsop and Jessup JJ) was also dismissed3. The Commissioner has now appealed to this Court. That appeal, too, must be dismissed for the following reasons. Factual background The role of Wycliffe. Wycliffe Bible Translators (International) is a missionary organisation. It seeks to spread the Christian religion through missionaries. It is particularly active in developing countries, and among sections of the population who have no written language. The missionaries learn the local language, teach people to read and write that language, translate the Bible into that language, and then teach the people how to read the Bible. It has about 5,300 workers and 56 members. One of the members is Wycliffe Bible Translators Australia ("Wycliffe"). From 1 July 2000 Wycliffe has been endorsed by the Australian Taxation Office as an income tax exempt charity under subdiv 50-B of the Income Tax Assessment Act 1997 (Cth) ("the 1997 Act"). Word was founded by members closely associated with Wycliffe who wanted to use Word to raise money within Australia and give it to Wycliffe for the carrying out of its purposes, which, at least to some degree, are fulfilled overseas. The issues in the appeal centre on the fact that although Word has paid Wycliffe to carry out Bible translation on its behalf, Word does not itself directly carry out the training or dispatching of missionaries overseas, the publishing of the Bible or the preaching of the gospel, but gives its profits (less sums retained 1 Re Applicant and Federal Commissioner of Taxation (2005) 60 ATR 1265. 2 Federal Commissioner of Taxation v Word Investments Ltd (2006) 64 ATR 483. 3 Federal Commissioner of Taxation v Word Investments Ltd (2007) 164 FCR 194. Crennan by it4) to Wycliffe, and other similar Christian organisations, to enable them to perform these activities. Word's memorandum. Word was incorporated under the Companies Act 1961 (Vic) on 8 August 1975, as a company limited by guarantee. The parties are agreed that at least some of the objects are charitable; Word contends that they all are. Clause 4 of the memorandum of association prohibits the payment of any of Word's income and property to members, save in return for services rendered or goods supplied. Clause 7 provides that on a winding up or dissolution any surplus is not to be given to the members, but only to some institution or institutions having objects similar to those of Word and having restrictions on distributions to members at least as great as those in Word's memorandum. Word's activities. From about 1986 Word began to accept deposits from members of the public. The depositors received little or no interest from Word, but Word invested the money at commercial rates of interest. In the period 1996- 2002, Word operated a business of conducting funerals, not all of Christians, for profit. The profits generated from the investment business and the funeral business were used to support Christian activities in the form of Bible translation and missionary work largely carried out by Wycliffe and other bodies to whom the non-retained profits were given. The parties accepted that although the Administrative Appeals Tribunal had seen the operation of the funeral business as depriving Word of its status as a charitable institution, nothing turned on the different sources of profit for the purposes of the arguments in this Court. Endorsement of tax exempt entities. This appeal arises in relation to Divs 50 and 50-B of Pt 2-15 of the 1997 Act5. Word claims to be a "charitable institution", which is an "entity" covered by item 1.1 of the table set out in s 50-5 of that Act6. Section 50-52 provides that an entity covered by item 1.1 is not exempt from income tax unless the entity is endorsed as exempt from income tax 4 Pursuant to sub-cl 3(a) of the memorandum, quoted at [20] below. 5 After the period relevant to this appeal, the endorsement provisions of the 1997 Act (ss 50-115 to 50-160 of subdiv 50-B) were repealed by the Tax Laws Amendment (2004 Measures No 1) Act 2004 (Cth) (No 95 of 2004), Sched 10, item 39. In their place, Pt 5-35 of Sched 1 of the Taxation Administration Act 1953 (Cth) was introduced. Section 50-105 was amended to correspond with the new provisions. 6 See below at [49]. Crennan under subdiv 50-B7. In subdiv 50-B there appeared at the relevant time s 50-115, which provided that an entity might apply to the Commissioner for endorsement as exempt from income tax. Section 50-105 obliges the Commissioner to endorse an entity which has applied for endorsement as exempt from income tax if it is entitled to be so endorsed. Section 50-110(1) provides that the entitlement of an entity to be endorsed depends on meeting the requirements of s 50-110. Section 50-110(2) provides that one requirement is that the entity be a "charitable institution" as described in item 1.1 of the table set out in s 50-5. Section 50-110(5)(a) provides that another requirement for an entity in the circumstances of Word is that the entity meet the conditions referred to in the column headed "Special Conditions" against item 1.1 of the table. One of those special conditions, created by s 50-50(a), is that the entity be one which "has a physical presence in Australia and, to that extent, incurs its expenditure and pursues its objectives principally in Australia". Word's application the Commissioner for endorsement as exempt from income tax. The Commissioner refused that application by letter of 2 May 2001. The letter said: the Commissioner. Word applied "Commercial enterprise entities are not considered to be charities. This is the case irrespective of whether charitable consequences flow from the entity's activities." On 16 March 2002 Word made a further application for endorsement in relation to the period from 1 July 2000. On 13 May 2002 the Commissioner rejected that application on the ground that Word was "not an organisation instituted to advance or promote charitable purposes." On 18 July 2002 Word objected to that refusal, but by letter of 24 February 2003 the Commissioner disallowed the objection. That letter said: "In your circumstances, your main activities are to provide financial planning advice and to carry out investment activities for the investors. You receive income from the investment of the funds of investors. You then distribute your available funds to other organisations to enable them to carry out evangel [sic] activities to benefit of [sic] a wide range of indigenous people. 7 See below at [50]. Crennan We consider that the money generating purposes are not incidental to the religious purposes. The money generating purposes represent independent purposes which are a mean [sic] to fulfill your religious purposes." The issues Although the Commissioner conceded that Word had not set up a tax avoidance scheme, he posed four issues in the path of Word's claim to be endorsed as exempt from income tax. The first issue posed by the Commissioner is whether Word is prevented from being a "charitable institution" by reason of the fact that its objects are not confined to charitable purposes. On the assumption that the first issue were to be resolved in Word's favour, the second issue posed by the Commissioner is whether: "an entity, which does not itself engage in any significant charitable activities but, rather, is established to conduct, and conducts, an investment, trading or other commercial activity for profit (albeit not for distribution to its members) is a charitable institution because it was established for the purpose of distributing, and distributes, its profits, wholly or mainly to charitable institutions." Assuming that the second issue were to be decided in Word's favour, the third issue is whether Word is prevented from being a "charitable institution" by reason of the fact that the institutions to which it gave its profits "were not confined as to the use to which they may put the funds distributed to them". Assuming that the third issue, too, were to be resolved in favour of Word, the fourth issue posed by the Commissioner is whether Word is prevented from being a "charitable institution" which is entitled to be endorsed as exempt from income tax on the ground that it does not comply with s 50-50(a) in that it cannot be said that it "has a physical presence in Australia and, to that extent, incurs its expenditure and pursues its objectives principally in Australia". First issue: are Word's objects confined to charitable purposes? The primary argument. The Commissioner submitted that Word's objects were not confined to religious or charitable purposes. The Commissioner accepted that where the question was whether property was held by a trustee on trust for charitable purposes, the character of the trust as a trust for charitable purposes was not affected by the power of the trustee to invest the assets, or use Crennan them to carry on businesses, with a view to profit. But the Commissioner submitted that where the question was not whether the property was held by a trustee on trust for charitable purposes, but rather was whether an institution not holding its property as trustee, but owning it absolutely, was to be characterised as a charitable institution, its power to use its assets in business with a view to profit, and its utilisation of that power, was crucial. The Commissioner submitted that if an entity claiming to be a charitable institution made a profit "as an incidental activity, or as concomitant and ancillary to the conduct" of the entity's charitable activities, it would not cease to be a charitable institution. But he said that if the profit-generating activity went beyond the incidental or the ancillary, the institution was not charitable. The Commissioner relied on the following statement by Gibbs J (Barwick CJ, Menzies and Walsh JJ concurring) in Stratton v Simpson8: "It is established that 'an institution is a charitable institution if its main purpose is charitable although it may have other purposes which are merely concomitant and incidental to that purpose' or in other words if each of its objects is either charitable in itself or should be construed as ancillary to other objects which themselves are charitable[9]. If however the non-charitable purpose is not merely incidental or ancillary to the main charitable purpose, the institution will not be charitable[10]." The Commissioner submitted that the main object of Word was not religious but was "to engage in investment and trading activities for the purpose of raising funds for Wycliffe and other similar organisations". The Commissioner submitted that the "basic function" of Word was to conduct businesses, and the making of profits and the distribution of them to charitable institutions like Wycliffe were merely incidental to the conducting of businesses. The Commissioner relied on a statement of Starke J that where the stated objects in a memorandum of association are "of a mixed character and the memorandum does not make it clear which are its main or dominating (1970) 125 CLR 138 at 159-160; [1970] HCA 45. 9 Congregational Union of New South Wales v Thistlethwayte (1952) 87 CLR 375 at 442 and 450; [1952] HCA 48. 10 Oxford Group v Inland Revenue Commissioners [1949] 2 All ER 537; In re Harpur's Will Trusts [1962] Ch 78 at 87. Crennan characteristics", it was necessary to examine the activities of the company11. The Commissioner additionally relied on the following statement of Williams J in the same case about the Royal Australasian College of Surgeons12: "in order to determine what is the main or dominant purpose of the College, it is a mistake to examine the objects contained in the memorandum in [a] disjunctive fashion. They should be examined in conjunction with one another and in the light of the circumstances in which the College was formed and of the manner in which the College is fulfilling the purposes for which it was incorporated." The Commissioner further relied on Roman Catholic Archbishop of Melbourne v Lawlor13. That case concerned an attempted bequest to an archbishop and three bishops "to establish a Catholic daily newspaper". The particular point which the Commissioner desired to extract from the case was put succinctly by Starke J thus14: "The objects and purposes of a Catholic newspaper are not, and can by no means be, confined to strictly charitable purposes." Finally, the Commissioner relied on the following statement of Rand and Locke JJ in the Supreme Court of Canada in R v The Assessors of the Town of Sunny Brae15: "We have today many huge foundations yielding revenues applied solely to charitable purposes; they may consist, as in one case, of a newspaper business; even if these foundations themselves carried on their charitable ministrations, to characterize them as charitable institutions merely because of the ultimate destination of the net revenues, would be to distort the meaning of familiar language; and to make that ultimate application the sole test of their charitable quality would introduce into the law conceptions that might have disruptive implications upon basic 11 Royal Australasian College of Surgeons v Federal Commissioner of Taxation (1943) 68 CLR 436 at 448; [1943] HCA 34. 12 Royal Australasian College of Surgeons v Federal Commissioner of Taxation (1943) 68 CLR 436 at 452. 13 (1934) 51 CLR 1; [1934] HCA 14. 14 (1934) 51 CLR 1 at 25. 15 [1952] 2 SCR 76 at 92. Crennan principles not only of taxation but of economic and constitutional relations generally. If that is to be done, it must be by the legislature." The central authorities. It must be said at the outset that the Commissioner relied on authorities coming from a range of fields and on a range of issues – whether land was being used exclusively or wholly for charitable purposes so as to enjoy immunity from rates16; whether a bequest for a particular purpose was for charitable purposes17; whether a gift for charitable and non- charitable purposes, the whole gift being capable of devotion to the latter, was charitable18; will construction cases19; and cases about whether, for example, a building was exempt from rates on the ground that it was used exclusively for the religious work of a religious organisation20. The primary relevant line of authority, however, is that which is concerned with the predecessor to ss 50-5, 50-50 and 50-110 of the 1997 Act, namely s 23(e) of the Income Tax Assessment Act 1936 (Cth) ("the 1936 Act")21. The Commissioner did rely on this line of authority22. The principal statements made in it were made about companies in an age in which the ultra vires doctrine existed and in which it was mandatory for companies to state their objects in a memorandum of association. In that age, a failure by a company to comply with its objects could have deleterious consequences for third parties dealing with the company. It is not now mandatory for companies to state their objects in a memorandum of association, 16 Salvation Army (Victoria) Property Trust v Fern Tree Gully Corporation (1952) 85 CLR 159; [1952] HCA 4; Scottish Burial Reform and Cremation Society Ltd v Glasgow Corporation [1968] AC 138. 17 Roman Catholic Archbishop of Melbourne v Lawlor (1934) 51 CLR 1. 18 In re Smith, decd [1954] SASR 151 at 159-160. 19 Stratton v Simpson (1970) 125 CLR 138. 20 R v The Assessors of the Town of Sunny Brae [1952] 2 SCR 76; see also Oxfam v Birmingham City District Council [1976] AC 126. 21 It provided that the "income of a religious … charitable institution" was to be exempt from income tax. 22 Royal Australasian College of Surgeons v Federal Commissioner of Taxation (1943) 68 CLR 436 at 447-448, 450-451 and 452; Incorporated Council of Law Reporting (Q) v Federal Commissioner of Taxation (1971) 125 CLR 659 at 670- 672; [1971] HCA 44. Crennan and the ultra vires doctrine no longer exists23. But there is no reason to suppose that the tests laid down in the s 23(e) line of cases no longer apply in relation to the 1997 Act to companies like Word, which state objects in a memorandum. That is, it is necessary to examine the objects, and the purported effectuation of those objects in the activities, of the institution in question. In examining the objects, it is necessary to see whether its main or predominant or dominant objects, as distinct from its concomitant or incidental or ancillary objects, are charitable24. The distinction between purposes and objects. In H A Stephenson & Son Ltd (In Liq) v Gillanders, Arbuthnot & Co25 Dixon J drew the following distinction: "When the question is whether a particular transaction binds the company, or is extra vires, the well-known principle may not apply by which, in considering whether a company should be wound up because the substratum of its constitution has failed, its true, main, dominant or paramount purpose is ascertained and general clauses are understood as subsidiary, as conferring powers not independent but subserving the main end. In the one case the ultimate question is whether it is just and its equitable determination, general intention and common understanding among the members of the company may be important. In the other case the question is one of corporate capacity only, and this must be ascertained according to the true meaning of the memorandum interpreted by a fair reading of the whole instrument." the company should be wound up, and, for that While the distinction may lack precise correspondence with the modern law since the abolition of the ultra vires doctrine, it applies precisely to companies like Word, which have a memorandum of association with an objects clause. What are the objects of Word? However, it is not necessary in this appeal to seek to distinguish between the main, predominant or dominant object and other objects. That is because Word has only one group of objects – a group of 23 See Companies (Victoria) Code, ss 66C, 67 and 68. See now Corporations Act 2001 (Cth), ss 124 and 125. 24 Royal Australasian College of Surgeons v Federal Commissioner of Taxation (1943) 68 CLR 436 at 447, 448, 450 and 452. 25 (1931) 45 CLR 476 at 487; [1931] HCA 47. Crennan objects of advancing religious charitable purposes. All other "objects" which may seem to be outside that group are on their true construction either objects within that group, or powers to carry out objects within that group. Clause 3 of Word's memorandum of association is too lengthy to quote, but it opens with the words: "The object [sic] for which the company is established are ..." It suffices to quote the first three objects: "(a)(i) To proclaim preach teach enunciate expound and to propagate evangelise continue carry forward expand and increase the Christian Religion both in Victoria and throughout the rest of the world by all means whether oral printed visual audible mechanical or otherwise. (ii) To provide train maintain and send forth teachers preachers and lecturers who subscribe to the basis of belief of the member of the Company contained in Clause 8 hereof.[26] (iii) To co-operate with encourage and provide assistance both financial and otherwise for Evangelical Missionary Organisations and Evangelical Missionaries operating or to become operative in Victoria or elsewhere throughout the world." The memorandum declares that the objects specified "shall be regarded as independent objects". Sub-clause 3(a) of the memorandum sets out 17 matters. Sub-clause 3(a)(xvii), which gives a power to acquire equipment for the purposes of Word stands apart from the other 16 matters and is of the same kind as those set out in sub-cll 3(b)-(ak). Among the other 16 matters set out in sub-cl 3(a) are numerous purposes, which, whether considered by themselves or in the context of cl 3, are plainly charitable (eg sub-cl 3(a)(i)). There are other purposes in sub- cl 3(a) which, considered by themselves, are not charitable, for example, sub-cl 3(a)(iv), which provides: "To hold rallies and other meetings in Victoria and when occasion arises through the rest of the world." However, when the 16 purposes enumerated in sub-cl 3(a)(i)-(xvi) are read as a whole, each of them on its true construction states a charitable purpose – a purpose of advancing religion in a charitable sense. Those which taken separately are beyond that purpose are to be read down as being within it. Sub-clauses 3(a)(xvii) and (c)-(ak) need to be read in the light of sub-cl 3(b) which provides: "To carry on any business or activity which may seem to the Company capable of being conveniently carried on in connection with the objects for which this Company is established." This 26 Clause 8 sets out seven propositions comprising a declaration of faith. Crennan suggests that for the most part it is sub-cl 3(a) which states the company's purposes, not sub-cll 3(b)-(ak), which perform another function. That suggestion is confirmed by the radical difference between the matters listed in sub-cl 3(a)(i)- (xvi) and the matters listed in sub-cll 3(a)(xvii) and (b)-(ak). The former can truly be described as purposes, while the latter are not to be construed as purposes at all, but rather as powers. The most specific of the arguments advanced by the Commissioner for the conclusion that the objects for which Word's profits might be applied were not limited to religious or other charitable purposes centred on three provisions of the memorandum. One was sub-cl 3(k) of the memorandum: "To subscribe and make payments to any fund for religious charitable or benevolent objects of any description" (emphasis added). The second was sub-cl 3(u): "To set aside out of the profits of [Word] such sums as the Board of Directors thinks proper as reserved, for maintaining the whole or any part of [Word's] property or for meeting contingencies and for any other purposes connected with the business of [Word] or any part thereof and the Board of Directors may invest the sums so set aside in the business of [Word] or in such securities as the Board of Directors selects." The third was the incorporation by sub-cl 3(aj) of cl 7 of the Third Schedule to the Companies Act 1961 (Vic) which conferred a power "to subscribe or guarantee money for charitable or benevolent objects, or for any exhibition, or for any public, general, or useful object" (emphasis added). So far as sub-cl 3(u) is concerned, a power to retain profits conferred on directors of a company which has charitable purposes cannot negate its character as a charitable institution. Its exercise, while it may delay the moment when assets are applied to charitable purposes, also increases the chance that more assets will eventually be so applied. So far as sub-cl 3(k) and cl 7 of the Third Schedule are concerned, they do not create purposes. They confer powers only. Those powers do not authorise conduct which does not further the charitable purposes of Word. The Commissioner's reliance on Roman Catholic Archbishop of Melbourne v Lawlor was misplaced. In that case Rich J, Starke J and Dixon J held that a gift by will of personal property "to establish a Catholic daily newspaper" extended beyond charitable purposes. Gavan Duffy CJ and Evatt J, and McTiernan J, held that it did not. The question whether the "purposes" stated in sub-cll 3(a)(xvii) and (b)-(ak) are in truth purposes or merely powers is quite different from the question in Lawlor's case. It is true that the question whether all the purposes stated in sub-cl 3(a) are charitable purposes and no more bear Crennan some analogy with that discussed in Lawlor's case, but it is clear that when the purposes in sub-cl 3(a)(i)-(xvi) are read together they are all charitable purposes. It is therefore necessary to reject the Commissioner's arguments so far as they submitted that Word had a "commercial object of profit from the conduct of its business" which was "an end in itself" and was not merely incidental or ancillary to Word's religious purposes. Word endeavoured to make a profit, but only in aid of its charitable purposes. To point to the goal of profit and isolate it as the relevant purpose is to create a false dichotomy between characterisation of an institution as commercial and characterisation of it as charitable. Circumstances of Word's formation. In addition to what flows from the construction to be given to the memorandum of association, it is necessary to take into account the circumstances in which Word was formed27. The Administrative Appeals Tribunal found that the founders of Word "had a clear intention that its function was to raise funds for the benefit of [Wycliffe] and/or similar religious organisations." Among the evidence supporting that finding was the assertion of Mr Ross Wilkerson, a director of both Word and Wycliffe, that the "intention in establishing [Word] was to create a fundraising auxiliary primarily to support the religious activities of [Wycliffe] and the propagation of Christian religion." He also said that Word "was established as a financial support company for Wycliffe." He further said that Word "regards itself as a supporting arm of Wycliffe and the directors of [Word] have a close interest and involvement in the work of Wycliffe"; that Wycliffe recommends people to be directors of Word; and that the two companies share offices and staff. There was also evidence of David Cummings, who had served with Wycliffe Bible Translators (International) from 1957 (ie before Word was incorporated). He said that the group who founded Word had three points in mind: That interested friends of Wycliffe might lend [Word] money, for the board of [Word] to invest, so that any profits would then go directly to the work of Bible translation and its affiliate activities such as Church Planting (establishing an initial core group of worshippers), training of pastors, literacy work, publishing the translated scriptures and recruiting nationals to be involved in translation work and preaching the gospel. 27 Royal Australasian College of Surgeons v Federal Commissioner of Taxation (1943) 68 CLR 436 at 452 per Williams J ("circumstances in which the College was formed"). Crennan It was a way of highlighting the need for funding for the religious work of Wycliffe and an avenue for friends to have a vehicle to see their investment directly helping the religious work of Wycliffe Bible Translators and its workers. The [Word] board then gave itself to finding the most profitable ways it could use the money, lent or given from the interested Christian public, that would gain the best income on the invested monies. It was the intention that most (if not all) of the interest would be channeled into the religious work of Wycliffe or its members, with the balance of interest being returned to investors." Word's activities. In Royal Australasian College of Surgeons v Federal Commissioner of Taxation28 McTiernan J said that whether the appellant in that case fulfilled the description of a scientific institution depended less on the fact that it could direct its efforts to scientific objects than "what it does in pursuit of each of them." The inquiry, so far as it is directed to activities, must centre on whether it can be said that the activities are carried on in furtherance of a charitable purpose. So far as the actual activities of Word in furtherance of its purposes are relevant, it is plain that, subject to the Commissioner's contentions in relation to the second and third issues29, the funds paid out by Word were paid to bodies fulfilling charitable purposes. The activities of Word in raising funds by commercial means are not intrinsically charitable, but they are charitable in character because they were carried out in furtherance of a charitable purpose. The Sunny Brae case. The short answer to the Commissioner's reliance on R v The Assessors of the Town of Sunny Brae30 is that Word's position does not depend on the mere fact that its revenues are applied solely to charitable purposes, but on the related fact that those are its sole purposes. Unlike the society in that case as viewed by the majority of the Supreme Court of Canada, Word is not a company with both charitable and non-charitable purposes which carried on commercial businesses and incidentally conferred benefits on charity; Word is a company having purposes which are solely charitable and which carried on commercial businesses only in order to effectuate those purposes. 28 (1943) 68 CLR 436 at 450. See also at 448-449 per Starke J, 452 per Williams J. 29 Discussed below at [35]-[45]. 30 [1952] 2 SCR 76 at 92: see above at [16]. Crennan The Christian Enterprises Ltd v Commissioner of Land Tax. Commissioner relied on the opinions of Nagle J at trial31 and Walsh JA (Asprey JA concurring) on appeal in Christian Enterprises Ltd v Commissioner of Land Tax32. Christian Enterprises Ltd was a company limited by guarantee. Its primary objects were either religious or raising funds for religious purposes. Its objects were expressed to include commercial objects, but these were expressed to be for the purposes of carrying out the primary objects. The Commissioner of Land Tax assessed it as liable for land tax, and rejected its claims that it was exempt as a "charitable institution" pursuant to s 10(1)(d) of the Land Tax Management Act 1956 (NSW) or a "religious society" pursuant to s 10(1)(e). Nagle J said that in view of the religious purposes, it could be said that the company was being carried on for charitable purposes, but held that it was not a charitable institution: it was not enough to constitute an institution that seven individuals with charitable intentions formed themselves into a company33. He also held that it was not a religious society. In the Court of Appeal, Walsh JA and Asprey JA (Wallace P dissenting) agreed on the first point, but disagreed on the second. Contrary to the Commissioner's submissions in the present appeal, Walsh JA (like Nagle J) did not construe the phrase "charitable institution" as a single composite expression, but saw it as having two integers – one to do with objects which were charitable, to do with "institutional" characteristics. Thus he said34: the second "the religious objects of the company must be regarded as charitable objects. But I do not think it was an 'institution'". Walsh JA went on to deny that every company with charitable objects was a charitable institution. The Commissioner submitted in this appeal that the "authorities and dictionary references discussed by Nagle J and Walsh JA suggest that for an entity to be a 'charitable institution' it must possess a public character, purpose or object". The authorities and dictionary references do not in fact suggest this. Walsh JA summarised an argument of counsel which assumed that the word "institution" included "a notion of something which has a public 31 [1967] 1 NSWR 653. 32 [1968] 2 NSWR 99. 33 [1967] 1 NSWR 653 at 657. 34 [1968] 2 NSWR 99 at 104. Crennan character or serves a public purpose", but he rejected the argument which made that assumption35. If Walsh JA, despite that rejection, was intending to adopt counsel's assumption, the Commissioner did not explain why Word's purpose of advancing religion – a charitable purpose having, ex hypothesi, benefit to the public, and carried out on a substantial basis financially speaking – caused it to lack a public character or not to serve a public purpose. Although Nagle J and Walsh JA discussed examples of what was and what was not an institution, as did the Privy Council in the main case they relied on, Minister of National Revenue v Trusts and Guarantee Co Ltd36, neither they nor the Privy Council explicitly offered any test for the meaning of "institution". In that case the Canadian settlor had settled a fund to be used "for the benefit of the aged and deserving poor" of the town of Colne in Lancashire, but there was no "charitable institution" as required for exemption from Canadian income tax; the trust was "an ordinary trust for charity"37 and there was no "institution" "in the sense in which boards of trade and chambers of commerce are institutions"38. Accordingly, this case can readily be distinguished, since it concerned a gift to a trustee on trust for charitable purposes as distinct from an "institution" not holding property on trust, but owning it outright and having charitable objects. Christian Enterprises Ltd v Commissioner of Land Tax, too, can be distinguished: unlike Word, the company had not begun to carry out its purposes, but it only engaged in the preparatory acts of investing funds for a short time before buying land on which it planned to build, but had not yet built, houses for resale39. In contrast, Word's activities in pursuance of its purposes have been carried on for years. For these reasons, Christian Enterprises Ltd v Commissioner of Land Tax does not support the Commissioner's position in this appeal. Glebe Administration Board v Commissioner of Pay-roll Tax. The Commissioner also relied on Glebe Administration Board v Commissioner of Pay-roll Tax40. It was there held that the wages paid by the Board, a body 35 [1968] 2 NSWR 99 at 104. 37 [1940] AC 138 at 148 and 150. 38 [1940] AC 138 at 149. 39 [1967] 1 NSWR 653 at 654. 40 (1987) 10 NSWLR 352. Crennan corporate constituted under the Church of England (Bodies Corporate) Act 1938 (NSW), were not exempt from pay-roll tax on the ground that the exemption given by the Pay-roll Tax Act 1971 (NSW), s 10(b), for wages paid by "a religious … institution" was not applicable. A majority of the Court of Appeal of the Supreme Court of New South Wales (Priestley JA, McHugh JA concurring) viewed the Board as "a statutory corporation doing commercial work within limitations fixed by reference to religious principles"41 and construed s 10(b) as not being aimed at "exempting from liability to pay-roll tax wages paid to persons substantially engaged in commercial activity."42 That case, then, is a decision about a particular statute different from the one under consideration in this appeal, and a decision about a different entity. In contrast to the view which the Court of Appeal took of the Board in that case, the correct view in this case is that Word was using its powers to employ commercial methods to raise money for its purposes: it was not doing commercial work within limitations fixed by reference to religious principles. A final argument. The Commissioner sought leave to rely on an argument not put before the Full Court that the conduct by Word of its investment arm alone prevented it from being a charitable institution. That leave should be granted, but the argument should be rejected for the reasons stated above. Conclusion. Nothing in the authorities or arguments relied on by the Commissioner suggests that Word is not an "institution" in the senses approved in Stratton v Simpson43: "'an establishment, organization, or association, the promotion of some object, especially one of public utility, religious, charitable, educational etc.'[44] … 'an undertaking formed to promote some defined purpose …' or 'the body (so to speak) called into existence to instituted for 41 (1987) 10 NSWLR 352 at 365. 42 (1987) 10 NSWLR 352 at 373. 43 (1970) 125 CLR 138 at 158 per Gibbs J (Barwick CJ, Menzies and Walsh JJ concurring). 44 Quoting The Shorter Oxford English Dictionary. Crennan translate the purpose as conceived in the mind of the founders into a living and active principle'.[45]" Accordingly, subject to the Commissioner's other arguments, it is to be concluded that Word is a charitable institution. A caveat. To avoid doubt in future, it should be noted that it would not be enough that the purpose or main purpose of an institution were charitable if in fact it ceased to carry out that purpose. Just like the former s 23(g)(iii) of the 1936 Act, so the former s 23(e) of that Act46, and item 1.1 in the table in the present s 50-5 of the 1997 Act47, being provisions in the legislation exempting tax on annual income, have "a periodic operation"; the statute "directs the inquiry to a particular time, namely, the year of income so that consideration must be given not only to the purpose for which the [institution] was established but also the purpose for which it is currently conducted."48 It was not submitted that Word had acted outside its purposes; rather it was submitted that it had acted inside them, but that they were non-charitable for the reasons advanced in relation either to the first issue or the second. That contention has been rejected so far as it applies to the first issue and is rejected below in relation to the second issue. Second issue: can an institution be charitable where it does not engage in charitable activities beyond making profits which are directed to charitable institutions which do engage in charitable activities? The Commissioner's arguments. The Commissioner submitted that: "this is the first occasion on which a court in Australia has determined that an entity that does not itself engage in any significant charitable activities but, rather, conducts an investment, trading or other commercial activity for profit (albeit not for the benefit of its members) is a charitable 45 Quoting Mayor etc of Manchester v McAdam [1896] AC 500 at 511 per Lord Macnaghten. 46 See below at [62]. 47 See below at [49]. 48 Cronulla Sutherland Leagues Club Ltd v Commissioner of Taxation (1990) 23 FCR 82 at 96 per Lockhart J. See also Commissioner of Taxation v Triton Foundation (2005) 147 FCR 362 at 370-371 [20], and the discussion at [70] below. Crennan institution, or is otherwise charitable in nature, because under its constitution it was required to, and does, distribute its profits to one or more charitable institutions." The Commissioner submitted that the courts below had been wrong to make that determination. It was for the purposes of this submission that the Commissioner relied on the activities of Word. The Commissioner's point was that while, for example, it was an object of Word to "proclaim … the Christian Religion", it did not in fact do so. All it did was raise money from commercial activities and hand it to other bodies so that they could proclaim the Christian religion. It submitted that there was no nexus between the profit and the effectuation of a charitable purpose. There were too many intermediate steps – "[Word] determining to distribute, rather than retain for its own purposes, the profit, determining to whom a distribution is to be made and making the distribution". Resolution. It is implicit in the Commissioner's argument that there is a distinction between two cases. One case would arise where a company limited by guarantee which had religious charitable objects organised itself into two divisions, one of which employed the company's assets to make profits, the other of which spent the profits on those objects. A second case would exist where a company limited by guarantee had the same objects and made the same profits, but gave them to other organisations which spent them on those objects. On the Commissioner's argument, the first company is a charitable institution, but the second is not. It would not reflect credit on the law if the distinction implicit in the Commissioner's argument were sound. The English Court of Appeal, dismissing an appeal from Slade J, rejected a similar argument in Inland Revenue Commissioners v Helen Slater Charitable Trust Ltd49 (admittedly in a different statutory context) in holding that the income of one company having charitable objects was "applied for charitable purposes" when it was paid to another company with almost identical objects. Oliver LJ said, in giving the judgment of Waller LJ, himself and Fox LJ, that: the trusts on which "where the the accomplishment of the charitable purpose by a payment to some other organisation, I cannot for my part see why such a payment is not an application of the funds. funds are held envisage Crennan … I entertain no doubt whatever that, as a general proposition, funds which are donated by charity 'A', pursuant to its trust deed or constitution, to charity 'B' are funds which are 'applied' by charity 'A' for charitable purposes."50 Strictly speaking, that case (like this) was not one in which funds were held on trust, but was one in which one company owned assets and had certain purposes. But in this case, like that, the objects included advancing charitable purposes by assisting other organisations51, and the Commissioner does not dispute that the payments which Word makes are within its purposes. And the present case is stronger than that case, for in that case the funds advanced were retained by the recipient company and not expended on charitable purposes, whereas in the present case the income paid to Wycliffe and like bodies is expended on charitable purposes. One submission advanced by Mr Andrew Park QC for the successful taxpayer in that case may be noted52: "The Crown's wide submission that money subject to charitable trusts is not 'applied for charitable purposes' unless actually expended in the field, is revolutionary, unworkable and unacceptable in practice. There are innumerable charities, both large and small, in this country which operate on the basis of raising funds and choosing other suitable charitable bodies to donate those funds to. … If the Crown's wide argument is correct, many charitable bodies would be losing a recognised entitlement to tax relief and may, moreover, cease to be regarded as charitable." It is likely that the position in Australia is similar. In Baptist Union of Ireland (Northern) Corporation Ltd v Commissioners of Inland Revenue53 MacDermott J said: 50 Inland Revenue Commissioners v Helen Slater Charitable Trust Ltd [1982] Ch 49 51 See sub-cl 3(a)(iii), quoted above at [20]. 52 [1982] Ch 49 at 52. 53 (1945) 26 TC 335 at 348. Crennan "the charitable purpose of a trust is often, and perhaps more often than not, to be found in the natural and probable consequences of the trust rather than in its immediate and expressed objects." Similarly, the charitable purposes of a company can be found in a purpose of bringing about the natural and probable consequence of its immediate and expressed purposes, and its charitable activities can be found in the natural and probable consequence of its immediate activities. For those reasons the second issue must be resolved against the Commissioner. Third issue: were the institutions which received Word's payments confined in the use to which they could put them? The resolution of the first two issues against the Commissioner means that the purposes and activities of Word were charitable, that it is a charitable institution and that that character is not lost by reason of the fact that it did not itself advance charitable purposes directly, but gave its profits to other institutions which did. Despite that, the Commissioner submitted that if Word were to be a charitable institution, it had to ensure that the distributions it made were utilised by the donees for the advancement of religion. The Commissioner's submissions. The Commissioner submitted that the potential donees of Word's funds were not confined to religious or charitable institutions, and the distributions were not confined to religious purposes. He submitted, by reference to evidence, that the "amounts distributed were able to be utilised by Wycliffe and the other organisations as they deemed fit". In another version of his argument, he accepted that all the donees were religious institutions, but submitted that while the money may have been used by the donees for religious purposes (which he conceded could have been charitable), it may also have been used for purposes conducive to religion (which he submitted were not charitable). He further submitted that sub-cll 3(a)(iii), (k), (u) and (aj) (incorporating cl 7 of the Third Schedule to the Companies Act 1961 (Vic)) and cl 4 "did not require that a distribution be confined to charitable purposes or to charitable institutions." Word's memorandum. The last point was to some degree also made in connection with the first issue54. It is convenient to deal with it at the outset. 54 See above at [21]. Crennan Sub-clause 3(u) and cl 4 have nothing to do with the present issue, namely how far the recipients of Word's bounty were free to deal with it as they pleased: that is because sub-cl 3(u) deals with the power to retain, not only power to distribute or purpose of distribution, and because cl 4 deals only with the use of Word's property to promote its objects and not to benefit members. As to sub-cl 3(a)(iii), even if, read in isolation, that might permit a distribution for a non-charitable purpose, when read with the other relevant parts of sub-cl 3(a) (namely sub- cl 3(a)(i)-(ii) and (iv)-(xvi)), it is clear that Word is not authorised to make distributions for non-charitable purposes. It is true that sub-cl 3(k) and cl 7 of the Third Schedule55 on their face confer a power to make payments to non- charitable objects or institutions. But sub-cl 3(k) and cl 7 of the Third Schedule, read in context, would not be construed to permit payments to non-charitable institutions or for purposes outside those charitable purposes described in sub- cl 3(a)(i)-(xvi). One arm of the Commissioner's submission thus fails: no part of the memorandum of association authorises payments to institutions which are entirely free as to the use they make of the payments. Did Word leave the recipients at liberty to spend the amounts as they wished? The other arm of the Commissioner's submission turns on whether in fact any conditions were imposed by Word on the recipients of its gifts, or whether they were left free to spend the gifts as they wished. This was not a matter the Commissioner explicitly raised in his Statement of Facts Issues and Contentions before the Administrative Appeals Tribunal. However, in this appeal he relied on the evidence of Mr Wilkerson who said: "In 2002, the directors of [Word] determined that [Word] should ensure the translation of certain Christian Scriptures. To ensure this, [Word] requested Wycliffe to carry out translation on behalf of [Word]. [Word] paid to Wycliffe a sum of $92,597 for that purpose rather than make an equivalent distribution leaving the choice of applying those funds to the discretion of Wycliffe. In this way [Word] was able to participate more closely in the advancement of the Christian Religion through directing the translation of Christian Scriptures." In cross-examination, Mr Wilkerson answered affirmatively: the following question 55 Set out above at [21]. Crennan "The money that is donated to Wycliffe and other organisations, it is up to Wycliffe and those other organisations to determine how best to use that money?" Contrary to the Commissioner's submission, the meaning of these two pieces of rather vague evidence is not that Wycliffe was entirely at liberty to spend the money as it liked – either on translating Christian Scriptures or on some other purpose – but simply that it was at liberty to select any method it chose for the purpose of effectuating translations of Christian Scriptures, but was under an obligation not to spend the money on purposes other than that purpose. Accepting that Word bears the burden of proof on the point, it tendered evidence, and that evidence, although vague, was not contradicted or undercut in cross- examination. The evidence effectively negates the Commissioner's contention that the recipients of Word's bounty were at liberty to spend it on non-charitable objects. If that factual contention were to have been established, it would have been necessary to conduct a much more detailed evidentiary inquiry before the Tribunal on the issue than in fact took place. To some degree the Commissioner appeared to argue that there was no obligation on Wycliffe and the other entities to use the income transferred by Word in any particular way. That proposition cannot be accepted. They had an obligation to fulfil their purposes. In Inland Revenue Commissioners v Helen Slater Charitable Trust Ltd, the Court of Appeal approved the following observation of Slade J56: "Any charitable corporation which, acting intra vires, makes an outright transfer of money applicable for charitable purposes to any other corporation established exclusively for charitable purposes, in such manner as to pass to the transferee full title to the money, must be said, by the transfer itself, to have 'applied' such money for 'charitable purposes,' within the meaning of the two subsections, unless the transferor knows or ought to know that the money will be misapplied by the transferee." Slade J was speaking in a particular statutory context, but the proposition is equally true of the present case. There is no evidence, nor even any suggestion, that Word knew or ought to have known that the entities to which it transferred its income would misapply it, or that they did misapply it. Accordingly, the third issue must be resolved against the Commissioner. 56 [1982] Ch 49 at 60. Crennan Fourth issue: s 50-50(a) The courts below. As explained above57, the entitlement of Word to endorsement as exempt from income tax depends on compliance with s 50-50(a), namely that it be an entity which "has a physical presence in Australia and, to that extent, incurs its expenditure and pursues its objectives principally in Australia". There was no contest that Word had a physical presence in Australia, made the decisions about which entity should receive its income in Australia, and made the payments so determined in Australia. The primary judge in the Federal Court considered that s 50-50(a) did not raise any question about the charitable nature of Word. It merely "asks a physical question, a nexus question. Viewed in this light there can be no doubt that Word's nexus is exclusively with Australia. What it does, namely handing money to Wycliffe, it does in Australia."58 In the Full Federal Court, Allsop J (Stone J concurring) found no assistance in s 23(e) of the 1936 Act or the Explanatory Memorandum in relation to amendments made to s 23(e) which now find their counterpart in s 50-50. He said59: "The statutory question is: How and where does Word 'pursue its objectives'? It does so by donating funds in Australia to organisations which will use those funds probably outside Australia for a charitable purpose. There is no warrant in the legislation to combine the corporate forms of Word and the donee companies … Word's objectives are pursued in Australia by the donation of funds in accordance with its objects for evangelising religious purposes, which are charitable." Jessup J agreed. He added that he did not see that approach as creating tax avoidance problems or as being antagonistic to the objects underlying the legislation60. 58 Federal Commissioner of Taxation v Word Investments Ltd (2006) 64 ATR 483 at 59 Federal Commissioner of Taxation v Word Investments Ltd (2007) 164 FCR 194 at 60 Federal Commissioner of Taxation v Word Investments Ltd (2007) 164 FCR 194 at Crennan The Commissioner's arguments. The Commissioner contended that the religious objects which might cause Word to be characterised as a charitable institution were not effectuated by Word inside Australia, but by Wycliffe outside Australia. The Commissioner submitted that it was inconsistent for the Full Court to rely on the religious objects (only in fact pursued outside Australia) to characterise Word as a charitable institution, but to ignore the place where they were pursued in relation to s 50-50(a). Thus the Commissioner's argument on the fourth issue was essentially a back-up for the argument on the second issue. In relation to the second issue, the Commissioner argued that Word was not a charitable institution because it was wrong to attribute to it the charitable purposes of its donees like Wycliffe61. But in relation to the fourth issue the Commissioner contended that if the second issue was decided adversely because the charitable purposes of donees like Wycliffe were attributed to Word, there should be success on the fourth issue in view of the requirement that those purposes had to be pursued principally in Australia. "In summary, Word donated its profits primarily to Wycliffe for the purpose of Wycliffe applying those profits for Wycliffe's religious evangelical objectives pursued principally outside Australia. If that purpose of Word is the purpose by reference to which Word is to be characterised as a charitable institution, Word did not meet the requirements of s 50-50(a) because that objective was pursued principally outside Australia. Section 50-50(a) should be construed in that manner to give effect to, rather than thwart, its purpose." The legislative context of s 50-50. These submissions cast little clear light on the true construction of s 50-50(a). In deference to them, however, the following provisions must be taken into account as establishing the context in which s 50-50(a) appears. The starting point is a table appearing in s 50-5 containing nine items to which later provisions refer. The relevant items in the table are62: 61 See [36] above. 62 It is not necessary to examine the origins of items 1.6 and 1.7 in the table in s 50-5. Crennan Item Exempt entity Special conditions charitable institution religious institution scientific institution public educational institution fund established for public charitable purposes by will before 1 July 1997 trust covered by paragraph 50-80(1)(c) fund established in Australia for public charitable purposes by will or instrument of trust (and not covered by item 1.5 or 1.5A) see sections 50-50 and 50-52 see section 50-50 see section 50-55 see section 50-55 see sections 50-52 and 50-57 see sections 50-52 and 50-60 see sections 50-52 and 50-60 Section 50-50 provides: "An entity covered by item 1.1 or 1.2 is not exempt from income tax unless the entity: has a physical presence in Australia and, to that extent, incurs its expenditure and pursues its objectives principally in Australia; or is an institution that meets the description and requirements in item 1 of the table in section 30-1563; or is a prescribed institution which is located outside Australia and is exempt from income tax in the country in which it is resident; or is a prescribed institution that has a physical presence in Australia but which incurs its expenditure and pursues its objectives principally outside Australia." 63 Item 1 of the table in s 30-15 comprises: "A fund, authority or institution covered by an item in any of the tables in Subdivision 30-B", and those tables include copious lists of potential recipients, some defined generically, some identified by name. Crennan Section 50-50(a) has counterparts in ss 50-55(a), 50-60(a), 50-65(a) and 50-70(a). At the material time s 50-52(1) provided: "(1) An entity covered by item 1.1, 1.5, 1.5A or 1.5B is not exempt from income tax unless the entity is endorsed as exempt from income tax under Subdivision 50-B." Section 50-55 provides: "An entity covered by item 1.3, 1.4, 6.1 or 6.2 is not exempt from income tax unless the entity: has a physical presence in Australia and, to that extent, incurs its expenditure and pursues its objectives principally in Australia; or is an institution that meets the description and requirements in item 1 of the table in section 30-15; or is a prescribed institution which is located outside Australia and is exempt from income tax in the country in which it is resident." Section 50-57 provides: "A fund covered by item 1.5 is not exempt from income tax unless the fund is applied for the purpose for which it was established." At the material time s 50-60 provided: "A fund covered by item 1.5A or 1.5B is not exempt from income tax unless the fund is applied for the purposes for which it was established and: incurs, and has at all times since 1 July 1997 incurred, its expenditure principally in Australia and pursues, and has at all times since 1 July 1997 pursued, its charitable purposes solely in Australia; or is a fund which is referred to in a table in Subdivision 30-B or in item 2 of the table in section 30-15; or (c) distributes solely, and has at all times since 1 July 1997 distributed solely, to a charitable fund, foundation or institution which, to the best of the trustee's knowledge, is located in Australia and incurs its Crennan expenditure principally in Australia and pursues its charitable purposes solely in Australia; or distributes solely, and has at all times since 1 July 1997 distributed solely, to a charitable fund, foundation or institution that, to the best of the trustee's knowledge, meets the description and requirements in item 1 or 2 of the table in section 30-15." Section 50-75 contains provisions to aid in determining whether an institution, fund or other body incurs its expenditure or pursues its objectives principally in Australia, but they do not assist in resolving the present appeal. A different set of provisions related to the powers of the Commissioner against an entity endorsed as exempt from income tax, and the duties of that entity. Section 50-140(1) provided: "The Commissioner may request an entity that is endorsed as exempt from income tax to give the Commissioner information or a document that is relevant to the entity's entitlement to endorsement. The entity must comply with the request." Section 50-145(1) provided: "Before, or as soon as practicable after, an entity that is endorsed as exempt from income tax ceases to be entitled to be endorsed, the entity must give the Commissioner written notice of the cessation." Since the 1997 Act is a taxation law for the purposes of the Taxation Administration Act 1953 (Cth), failure to comply with ss 50-140(1) and 50-145(1) was an offence against s 8C of the 1953 Act. Finally, s 50-155(1) provided: "The Commissioner may revoke the endorsement of an entity as exempt from income tax if: the entity is not entitled to be endorsed as exempt from income tax; the Commissioner has requested the entity under section 50-140 to provide information or a document that is relevant to its entitlement to endorsement and the entity has not provided the requested information or document within the time specified in the request." Crennan The background to s 50-50. Does the background to s 50-50 cast any light on its construction? The detailed submissions of the Commissioner have revealed the background to be as follows. Origin of items 1.1-1.4. Section 11(d) of the Income Tax Assessment Act 1915 (Cth) ("the 1915 Act") provided: "The following incomes, revenues, and funds shall be exempt from income tax: – income of a religious, scientific, charitable, or public the educational institution". That is the origin of items 1.1, 1.2, 1.3 and 1.4 of the table in s 50-5. Section 11(d) was re-enacted in the Income Tax Assessment Act 1922 (Cth) ("the 1922 Act"), s 14(1)(d) and in the 1936 Act, s 23(e). Origin of items 1.5-1.5B. Before 1916 there was no exemption for the income of a trust for public charitable purposes. Section 26(1) of the 1915 Act obliged the trustee to pay tax on the income of the trust, unless it was distributed to beneficiaries (s 27(2)). This state of affairs was altered by the Income Tax Assessment Act (No 2) 1916 (Cth). It made an amendment to s 11(f) of the 1915 Act ("the 1916 amendment"). The effect of the amendment was to exempt from income tax "the income of a fund established by any will or instrument of trust for public charitable purposes if the Commissioner is satisfied that the fund is being applied by the trustees to public charitable purposes" (emphasis added). That is the origin of items 1.5, 1.5A and 1.5B of the table in s 50-5. Section 11(f) as amended was substantially re-enacted in the 1922 Act, s 14(1)(f). In s 23(j)(ii) of the 1936 Act, the legislature continued the exemption, but in a different form. Section 23 created an exemption from income tax for: the incomes of the following funds, provided that the particular fund is being applied for the purpose for which it was established – a fund established by will or instrument of trust for public charitable purposes". (emphasis added) Crennan The test thus turned not on the Commissioner's satisfaction that a fund established for public charitable purposes was being applied for those purposes, but on the application in fact of the fund for the purpose for which it was established. The 1997 amendment to s 23(e). The Taxation Laws Amendment Act (No 4) 1997 (Cth) amended s 23(e) of the 1936 Act by adding at the end: "which: (iii) has a physical presence in Australia and, to that extent, incurs its expenditure and pursues its objectives principally in Australia; or is an institution to which a gift by a taxpayer is an allowable deduction because the institution is referred to in a table in subsection 78(4)[64]; or is a prescribed institution which is located outside Australia and is exempt from income tax in the country in which it is resident; or is a prescribed charitable or religious institution that has a physical presence in Australia but which incurs its expenditure and pursues it [sic] objects principally outside Australia." The Explanatory Memorandum. The general explanation given in the Explanatory Memorandum for the amendment to s 23(e) and related amendments was65: "The measures will address avoidance arrangements which take advantage of the tax exempt status of charitable trusts and close off the possibility of certain organisations which also currently enjoy an income tax exemption from being used for tax avoidance purposes. Additionally, they will prevent, in particular circumstances, the transfer of revenue from Australia to a foreign country where Australia foregoes its taxing right by providing an income tax exemption for the Australian source income of an 64 Section 78(4) of the 1936 Act at that time provided that a gift by a taxpayer to a fund, authority or institution in Australia listed in 12 tables was an allowable deduction if certain conditions were met. 65 Explanatory Memorandum, Taxation Laws Amendment Bill (No 4) 1997 (Cth) at Crennan offshore organisation but the organisation is not exempt from tax on this income in its home country." Later the Explanatory Memorandum gave a more particular explanation66: "Section 23 provides an exemption from income tax for income derived from sources in Australia by a range of entities irrespective of whether these entities are located in Australia or offshore or whether their activities are undertaken in Australia or offshore … The Government has decided to remove these exemptions for these organisations if they are located or pursue their objects offshore in order to prevent: certain organisations to shift untaxed funds overseas; and tax avoidance arrangements which could use these a transfer of revenue from Australia to a foreign country where income is exempted in Australia but not in the organisation's country of residence." The Commissioner accepted that the second of the two points made in each of these passages was unrelated to the tax avoidance aspect of the legislation and irrelevant to the present appeal. The Commissioner did not suggest in the present appeal that Word and Wycliffe were engaged in "tax avoidance". The Explanatory Memorandum did not make it clear whether s 23(e)(i) (and hence its successor, s 50-50(a)) rested on the purpose of preventing tax avoidance or the other purpose or both. The Explanatory Memorandum said of the words "in Australia"67: "5.28 The Bill provides that for an organisation to remain exempt it must generally have a 'physical presence' in Australia or in some cases be 'located' in Australia. These terms are not defined in the legislation and therefore take their ordinary or everyday meaning. 66 Explanatory Memorandum, Taxation Laws Amendment Bill (No 4) 1997 (Cth) at [5.24] and [5.25]. 67 Explanatory Memorandum, Taxation Laws Amendment Bill (No 4) 1997 (Cth) at [5.28] and [5.29]. Crennan 5.29 In the case of 'physical presence' a broad interpretation is to be adopted – all that is required is for an organisation to operate through a division, sub-division or the like in Australia. The structure of the organisation is immaterial as is whether it has its central management and control or principal place of residence in Australia. On the other hand, the term would not apply where an organisation merely operates through an agent based in Australia." The Explanatory Memorandum also said68: "5.36 An organisation which falls within paragraphs 23(e), 23(ea) or 23(g) which has a physical presence in Australia but which does not incur its expenditure and pursue its objectives principally in Australia will only remain eligible for the exemption from income tax if the organisation falls within section 78 (see paragraph 5.8). 5.37 An organisation which falls within the above paragraphs but which is located offshore can only be exempt from Australian tax on its Australian source income if it is exempt from income tax in the country in which it is located and is specifically prescribed by the Income Tax Regulations to be exempt. 5.38 In the case of a charitable or religious institution which falls within paragraph 23(e), and which has a physical presence in Australia it will also be possible to gain an exemption by being specifically prescribed in the Regulations. 5.39 These conditions recognise that there may be some organisations that fall within section 78 although they undertake activities offshore. It will also allow the Government to grant income tax exemptions, on a case by case basis, to paragraph 23(e), 23(ea) or 23(g) organisations located offshore or paragraph 23(e) charitable or religious institutions with a physical presence in Australia but which pursue their objectives offshore. This regulation making process will allow Parliament the opportunity to fully scrutinise the organisation to determine whether it should receive the benefit of the exemption." 68 Explanatory Memorandum, Taxation Laws Amendment Bill (No 4) 1997 (Cth) at Crennan The 1997 position. The 1997 Act was enacted as Act No 38 of 1997. When originally enacted, it did not contain Pt 2-15, Div 50, which contains sections of importance for the present appeal69. The 1997 Act in that form came into force on 1 July 1997. On the same day Sched 1 to the Tax Law Improvement Act 1997 (Cth), which was Act No 121 of 1997, came into force: see s 2(2) of that Act. It contained in Pt 2-15, Div 50, the precursor to the present s 50-5, but did not contain s 50-50. The 1998 changes. Then the Taxation Laws Amendment Act (No 3) 1998 (Cth) was enacted. The changes it made to Pt 2-15, Div 50, apart from amending the sections introduced by the Tax Law Improvement Act 1997, included introducing s 50-50 in substantially its present form. (The only difference is that in 1998 s 50-50(b) referred to "Subdivision 30-B", not s 30-15.) Another change was to introduce s 50-60 in substantially its present form. When the amendments to the 1997 Act effected by the Taxation Laws Amendment Act (No 3) 1998 came into force the four additional sub-paragraphs at the end of par 23(e) of the 1936 Act introduced in 1997 appeared in s 50-50 as follows. Paragraph 23(e)(i) became s 50-50(a). Paragraph 23(e)(iii) became s 50-50(c). Paragraph 23(e)(iv) became s 50-50(d), save that the words The provision corresponding to "charitable or religious" were deleted. par 23(e)(ii), namely s 50-50(b), was: "is an institution which is referred to in a table in Subdivision 30-B". Paragraph 23(e)(ii) and s 50-50(b) had a similar effect, in that each required the relevant entity to have what the Commissioner called "tax deductible gift recipient status". The Explanatory Memorandum relating to s 50-50. The Explanatory Memorandum relating to s 50-50 was originally directed to the Taxation Laws Amendment Bill (No 7) 1997. It stated that it was now necessary to amend the 1997 Act "to 'catch up' the amendments made" by the Taxation Laws Amendment Act (No 4) 1997 to the 1936 Act70. It said, speaking of what became s 50-50(a)71: 69 Such as ss 50-5, 50-50, 50-60, 50-105, 50-110, 50-115, 50-140, 50-145 and 70 Explanatory Memorandum, Taxation Laws Amendment Bill (No 7) 1997 (Cth) at 71 Explanatory Memorandum, Taxation Laws Amendment Bill (No 7) 1997 (Cth) at [3.11] and [3.12]. Crennan "The basic rule now provides that for an organisation to be exempt from income tax it must generally have a 'physical presence' in Australia or in some cases be 'located' in Australia. These terms are not defined in the legislation and therefore take their ordinary or everyday meaning. In the case of 'physical presence' a broad interpretation has been adopted – all that is required is for an organisation to operate through a division, sub-division or the like in Australia. The structure of the organisation is immaterial as it is whether it has its central management and control or principal place of residence in Australia. On the other hand, the term does not apply where an organisation merely operates through an agent based in Australia." "An institution … generally only has to pursue its objects 'principally' in Australia. This term is also not defined in the legislation. The dictionary meaning of the word 'principally' is mainly or chiefly. Accordingly, it is not possible to specify a particular percentage but less than 50% would not be considered to meet the 'principally' requirement. Where there is some doubt whether this requirement is satisfied it will be necessary to examine each institution's individual circumstances." The 1999 changes. Then an Act called A New Tax System (Tax Administration) Act 1999 (Cth) was enacted. Schedule 8, which came into force on 22 December 1999, introduced ss 50-105, 50-110, 50-120, 50-140, 50-145 and 50-155. Section 50-50 contrasted with ss 50-57, 50-60 and 50-65. The Explanatory Memorandum did not explain why, in s 50-60 (and ss 50-57 and 50-65), there was a requirement that the fund claimed to be exempt was "applied for the purposes for which it was established", while there was no equivalent requirement in s 50-5073. The distinction has long existed in the precursors to the 72 Explanatory Memorandum, Taxation Laws Amendment Bill (No 7) 1997 (Cth) at 73 This has occasioned surprise: O'Connell, "The tax position of charities in Australia – why does it have to be so complicated?" (2008) 37 Australian Tax Review 17 at Crennan modern legislation74. As the Commissioner submitted in this appeal, the reason appears to lie in the difference between a "charitable institution", to which s 50-50 applies, and a "fund", or "trust", to which ss 50-57, 50-60 and 50-65 applies. Whether an entity is a "charitable institution" depends in part on its purposes and in part on its activities so far as they carry out those purposes; if its activities involve ceasing to apply its assets to the purposes for which it was established, it ceases to be a charitable institution. In s 50-50 it was thus not necessary to provide in terms that the assets of a charitable institution be "applied for the purposes for which it was established". On the other hand, s 50-60 applies to item 1.5A in the table in s 50-5 (a "trust covered by paragraph 50-80(1)(c)") and to item 1.5B (a "fund established in Australia for public charitable purposes by will or instrument of trust (and not covered by item 1.5 or 1.5A)"). And s 50-57 applies to item 1.5 (a "fund established for public charitable purposes by will before 1 July 1997"). Further, s 50-65 applies to item 1.6 (a "fund established to enable scientific research to be conducted by or in conjunction with a public university or public hospital"). In context the expression "fund" means a fund held by a trustee for charitable purposes. The trust covered by s 50-60, and the funds covered by ss 50-57, 50-60 and 50-65, continue to have their status as a trust or a fund even if the trustees are acting in breach of trust and not applying the assets to the relevant trust or fund purposes. Hence it was necessary to do in relation to ss 50-57, 50-60 and 50-65 what it was not necessary to do in relation to s 50-50, namely make express provision for loss of tax exemption where the trust or fund was not applied for the purposes for which it was established75. As Word submitted, the difference in drafting flows from the fact that ss 50-57, 50-60 and 50-65 (unlike s 50-50) speak of funds or trusts which were "established" for certain purposes, and the legislation requires not merely that they be established at the outset for those purposes, but also that their assets be applied for those purposes from time to time thereafter. The difference between the two categories of provision casts no other light on the meaning of "charitable institution". 74 The requirement appeared in s 11(f) of the 1915 Act after the 1916 amendment, in s 14(1)(f) of the 1922 Act and in s 23(j) of the 1936 Act, but not in s 11(d) of the 1915 Act, s 14(1)(d) of the 1922 Act or s 23(e) of the 1936 Act. 75 Cf Windeyer J (dissenting) in Stratton v Simpson (1970) 125 CLR 138 at 144. He said that a trust for charitable purposes "is commonly called a charitable institution". At 145 he said: "I can see no reason why, unrestrained by context, a fund raised by public contributions and administered by trustees could not be properly called an institution." The contrast between s 50-50, on the one hand, and ss 50-57, 50-60 and 50-65, on the other, creates a restraining contrary context. Crennan Difficulty of monitoring funds? It is convenient at this point to turn to a central submission by the Commissioner. The Commissioner argued: "The revenue would face great difficulty in monitoring the use of funds generated by a body in Australia if s 50-50(a) was satisfied by the payment over of funds in Australia to organisations which pursued their objectives outside of Australia. The identification of the objectives referred to in s 50-50(a) which must be pursued in Australia with the charitable objectives which result in the entity being characterised as a charitable institution provides a means by which the clear purpose of s 50-50(a) may be achieved." The Commissioner also said that the legislation was based on a: "concern … that an organisation in Australia that distributed its income to another organisation which appeared to be a charity but conducted its operations overseas, when that money went overseas, could be used for any purpose without the Commissioner being able to ascertain whether it was being used for charitable purposes." The Commissioner submitted that the legislation had set up: "a system by which, if the charitable objectives were being pursued overseas, the body had to be a prescribed body by the Act and the Commissioner could then vet all the steps by which the overseas objectives were being achieved. But if it was not a prescribed body, the charitable objectives that would give it its charitable status had to be pursued principally within Australia." The Commissioner's contention that the revenue authorities would have great difficulty in monitoring the use of funds generated by a body in Australia and given to another body active overseas is exaggerated. It is exaggerated because, if s 50-50(a) has an anti-avoidance purpose, this may be because the requirement it imposes makes it easier for the Commissioner to monitor organisations entitled to the exemption by using the information gathering powers backed by a criminal sanction which s 50-140(1)76 conferred and by using the power to revoke endorsement given by s 50-155(1)(b)77. The 76 See now Taxation Administration Act 1953, Sch 1, s 426-40(1). 77 See now Taxation Administration Act 1953, Sch 1, s 426-55(1)(b). Crennan Commissioner's contention is also exaggerated in the light of s 50-14578. If the Commissioner had reason to suspect that funds given by Word to Wycliffe were not being expended on charitable objects, this may attract the exercise of the power to request from Word the information and documents it had relevant to the subject. They could be relevant to Word's entitlement to be endorsed as income tax exempt, because if Word were giving funds to Wycliffe knowing that they would not be expended on charitable objects, it could not be described as a charitable institution. The same would be true if there were doubts whether Wycliffe was expending the funds on charitable objects. Word would be obliged to comply with the Commissioner's request, on pain of criminal sanctions and loss of endorsement. If Word's response to the request revealed, whether positively or by silence, that it knew that the funds were not being applied for charitable purposes, it would have ceased to be entitled to be endorsed and obliged by s 50-145(1) to give the Commissioner notice of that cessation. The same would be true if Word's response revealed that it was indifferent or careless about whether the funds were being applied for charitable purposes. The intractable language. The difficulty with the balance of the Commissioner's submissions is that, once it is concluded, as it was above79, that Word's sole purposes are charitable, and that they can be fulfilled by making payments to other institutions which have charitable purposes (as sub-cl 3(a)(iii) of the memorandum provides), s 50-50(a) does not contain language apt to deny Word exemption from income tax. That conclusion is not affected either by the context in which s 50-50(a) appears or by the history of the legislation since 1916. Section 50-50(a) requires Word to have a physical presence in Australia. This it has. Indeed it has no physical presence anywhere else. Section 50-50(a) also requires that, to that extent, Word incur its expenditure and pursue its objectives principally in Australia. That it did. The decisions to pay were made in Australia, the payments were made in Australia, the payments were made to Australian organisations, and the objects of Word included giving financial assistance to those organisations. The incurring of the expenditure and the pursuit of Word's objectives in this way took place nowhere but in Australia. Section 50-50(a) does not impose a prohibition on distributing to other charitable institutions. Nor does it require the money, when ultimately expended by Wycliffe and the other institutions, to be expended in Australia. Section 50-50(a) could have imposed a requirement of that latter kind, but it did not. It only imposed a requirement that Word incur its expenditure and pursue its objectives 78 See now Taxation Administration Act 1953, Sch 1, s 426-45. 79 See above at [19]. Crennan principally in Australia – not that Wycliffe and the other institutions do so. No doubt the ultimate benefit to charity which Word causes is effected by Wycliffe indirectly and to some extent outside Australia, not directly and in Australia: but s 50-50(a) draws no distinction between direct and indirect effects. There are admittedly, difficulties with s 50-50(a). Do the words "to that extent" govern "physical presence"? Or do they govern the incurring of expenditure and the pursuit of "objectives principally in Australia"? These difficulties do not arise in the present appeal. While in some instances the words "to that extent" may cause difficulty, the incurring by Word of expenditures and the pursuit of its objectives are acts not only done to the extent of its physical presence in Australia, but to any extent at all. The requirement of s 50-50(a) that Word have a physical presence in Australia, as it did, and incur its expenditure and pursue its objectives principally in Australia, as it did, carries the consequence that Word was completely open to scrutiny by the Australian authorities under s 50-140(1), was subject to the duty created by s 50-145(1), and was subject to the risk of revocation described in s 50-155. Orders The appeal must be dismissed with costs. Kirby KIRBY J. The law on charitable institutions is "difficult", "very artificial", noted for its "illogicalities"80 and "full … of anomalies"81. In it, "many fine distinctions have been made"82. Knowledgeable judges have admitted that83: "All those who practise in this branch of the law know how infinite is the variety of the decided cases, how extreme sometimes are the refinements, and how apparent on occasions the contradictions which those cases demonstrate". Where Australian legislatures have enacted relevant provisions, decision- makers must give effect to the will of the legislature as expressed in the language adopted, understood in light of the text, context, purpose and history. This Court, with substantial unanimity, has insisted on this approach84. Decision-makers must not cling inconsistently to judicial observations in decisional law that do not reflect the enacted law. To some extent, the notion of what is a "charitable institution" or what are "charitable purposes" has been treated as standing apart from the requirement mentioned above85. My own attempt to drag this body of law into the twenty-first century, in conformity with modernity and the applicable general principles, came to nothing86. 80 Oppenheim v Tobacco Securities Trust Co Ltd [1951] AC 297 at 307 per Lord Simonds. 81 In re Strakosch, decd [1949] Ch 529 at 536 per Lord Greene MR, delivering the reasons for decision of the Court. 82 Internal Revenue Commissioners v Baddeley [1955] AC 572 at 583 per Viscount Simonds. 83 In re Endacott, decd [1960] Ch 232 at 242 per Lord Evershed MR. These laments are collected by Professor G E Dal Pont in an unpublished paper, "Determining the 'Purpose'", delivered to the Queensland University of Technology on 11 July 2005. 84 Recent cases are collected in Central Bayside General Practice Association Ltd v Commissioner of State Revenue (Vic) (2006) 228 CLR 168 at 198 [84] fn 86; [2006] HCA 43. 85 Central Bayside (2006) 228 CLR 168 at 195-201 [76]-[92]. 86 Central Bayside (2006) 228 CLR 168 at 186 [45]. See also Chesterman v Federal Commissioner of Taxation (1923) 32 CLR 362; [1923] HCA 24; reversed in (1925) 37 CLR 317 (PC). That case is noted in Central Bayside (2006) 228 CLR 168 at Kirby No fresh judicial heroism was called for in this case. Both parties agreed that, generally, the taxation legislation in issue here was written against the background of the Statute of Elizabeth87, the decision of the Privy Council in Commissioners for Special Purposes of the Income Tax v Pemsel88 and judicial decisions in the United Kingdom, Australia and other countries that have followed that line of authority. The parties agreed that where specific legislation had been enacted, effect had to be given to it. Nevertheless, to resolve the present appeal, the general notion of what is a "charitable institution" and what are "charitable purposes" (so expressed for tax exemption purposes by the applicable taxation statute, the Income Tax Assessment Act 1997 (Cth) ("the 1997 Act")) are to be determined by reference to the "technical meaning" of those expressions. The issues in this appeal arise out of a judgment of the Full Court of the Federal Court of Australia89. That Court, in turn, affirmed the decision of the primary judge90. These decision-makers uniformly upheld the challenge by Word Investments Ltd ("Word") to the decision of the Commissioner of Taxation ("the Commissioner") rejecting Word's claim to be endorsed as an exempt "charitable institution" for income tax purposes. In my opinion, the decisions below erred in so concluding. The Commissioner is entitled to succeed. This Court should allow the appeal and restore the Commissioner's decision to refuse to endorse Word as an exempt charity. The facts An investment and funeral business: Many of the facts necessary for the resolution of the appeal are contained in the reasons of Gummow, Hayne, Heydon and Crennan JJ ("the joint reasons")91. I shall use the same abbreviations as are adopted there. 87 43 Eliz I c 4 (Charitable Uses Act 1601). 88 [1891] AC 531 at 581-582. 89 Federal Commissioner of Taxation v Word Investments Ltd (2007) 164 FCR 194 per Stone, Allsop and Jessup JJ. 90 Federal Commissioner of Taxation v Word Investments Ltd (2006) 64 ATR 483 per Sundberg J, affirming in part and reversing in part the decision of the Administrative Appeals Tribunal: Re Applicant and Federal Commissioner of Taxation (2005) 60 ATR 1265. 91 Joint reasons at [2]-[7]. Kirby Word engaged in investment and commercial business activities, albeit for the purpose of raising funds to be distributed to charitable bodies, including the missionary organisation Wycliffe Bible Translators Australia ("Wycliffe"), associated with Wycliffe Bible Translators ("Wycliffe International")92. Word's activities included, relevantly, the receipt of deposits from members of the public, a high minimum proportion of which were to be available for distribution by Word to recipients such as Wycliffe and Wycliffe International. (International) Word's memorandum and articles of association stated that Word existed for the purpose of providing financial planning advice and a sound investment vehicle by which interest earned could be used to further the work of Bible translation and other Christian works throughout the world. The memorandum also stated that Word was the financial support company for Wycliffe. After 1996, Word began operating a funeral business, Bethel Funerals. That business operated according to ordinary commercial principles. It extended its facilities to non-Christians. It adopted a principle that "business practices will be conducted with the highest moral and ethical codes and will have decidedly Christian Principles applied in all its activities". Pricing was to include a "margin of profit which will establish Bethel Funerals as an organisation capable of financing projects for the Lord's work". In dealing with financial matters, the Bethel Funerals philosophy statements declared: "[T]he business will be run as a professional funeral business and may expand into any allied aspects of the funeral business, such as coffin manufacturing, cemetery management or ownership, chapel ownership etc. The business may expand to other Australian States or overseas." The business' purposes: The evidence established that the purpose of Word was to raise moneys to permit payments by it to various Christian organisations, principally Wycliffe, for international missionary purposes. The ultimate purpose of such payments was to "ensure the translation of certain Christian Scriptures". As Word knew, Wycliffe had adopted a number of special projects that were principally undertaken in overseas countries, including the Philippines and Papua New Guinea. According to a statement by Mr Ross Wilkerson, a director of Word and Wycliffe, Word's object was to support Wycliffe's missionaries: 92 See Federal Commissioner of Taxation v Word Investments Ltd (2007) 164 FCR 194 at 210-211 [68] per Jessup J. Kirby "in third world countries around the world (generally countries that have previously had no written languages). Some missionaries are doing Bible translation and some are doing literacy work, such as teaching literacy skills. Missionaries move to the countries and learn the language, and then translate the Bible into that language and undertake literacy work. They may be in a country for 15 years or so. Once a translation of the Bible is complete, publication is normally funded by other organisations such as the Bible Society. … Wycliffe also has special projects – for example, a current project is to support indigenous people in Papua New Guinea ('PNG') to learn the skills to do Bible translation and literacy work in PNG. Other projects could be buying equipment (such as computers) to support Bible translation and literacy work in another country, and sometimes Wycliffe may fund the publication of a translation of the Bible. Wycliffe has a branch working in Darwin and Alice Springs working with Australian aborigines. I understand that this branch is now less active than it was previously." Whilst the object of Word included making payments to enumerated religious causes, principally Wycliffe, Word itself was not engaged in Bible translation, Bible production, Bible instruction or other similar activities. In effect, Word raised the money by collecting interest on its investments and through its commercial funeral business. That money would then be disbursed through Wycliffe to Wycliffe International and through other missionary or religious bodies to perform the charitable and religious activities. This characterisation of the activities of Word is made clear by the evidence of Mr Wilkerson, which was accepted by the Administrative Appeals Tribunal ("AAT"): "[The report to investors for 30 June 1997] refers to a situation in the Philippines and some work carried out in the Philippines. Do you see that? --- About the – yes, I do, yes. This is Wycliffe's work? --- That is correct, yes. And it was giving that example as --- Yes, and if you turn to the report to investors for 30 June '98, the box on the second page headed: Humble service multiplies in God's hands. Again, this is referring to work undertaken by Wycliffe? --- Correct. And also to the report to investors for the year ended 30 June 1999, and the box on the second page headed: Trembling on the altar, an extract Kirby from an interview with Grace Flavian, again that was work carried out by Wycliffe? --- Correct. Word itself does not send missionaries overseas? --- No. Also it does not train pastors? --- No. Also Word itself does not publish scriptures? --- No. Word itself also does not preach the Gospel? --- No. Only through its directors if they have opportunity, I guess, yes. Thank you. The money that is donated to Wycliffe and other organisations, it is up to Wycliffe and those other organisations to determine how best to use that money? --- Yes." Factual decisions below: The AAT summarised its conclusion on the evidence concerning the activities of Word up to 200293: "Between 1986 or 1987 and 1996, the sole activity of [Word] was the generation of income from interest earned on deposits from individuals seeking to support … fundraising activities. … However, the commencement of the funeral business in 1996 was a significant change in its operations and objectives. While it may be said that an underlying purpose of that business was the generation of profits for the ultimate benefit of a religious institution, it is difficult to consider a commercial funeral business as having an objective of the advancement of religion. … It is likely that the advisers to [Word] came to a similar view after seeking endorsement thus leading to the transfer of the business to a trust from 1 July 2002. While it is accepted that management and staff of the funeral business were all committed Christians, the business was a commercial operation for the purpose of making a commercial profit. As such, I do not accept that [Word] was itself a charitable institution whilst operating that business." The AAT went on to conclude that, under Item 1.1 of s 50-5 of the 1997 Act94, Word was nevertheless entitled to be endorsed as exempt from tax as a "charitable institution" following the change that it adopted in 2002. On appeal, the primary judge in the Federal Court rejected the AAT's conclusion that Word 93 Re Applicant and Federal Commissioner of Taxation (2005) 60 ATR 1265 at 1269- 94 (2005) 60 ATR 1265 at 1270 [17]. Kirby was not a "charitable institution" before the 2002 change whilst operating its investment and commercial funeral business95. The primary judge's conclusion was affirmed by the Full Court96. Essentially, the Commissioner urged this Court to characterise Word in the same way as the AAT, namely as an investment and commercial funeral business, notwithstanding the subventions to Wycliffe and other beneficiaries that Word had made from its income. Those beneficiaries were themselves charitable or religious institutions. Ultimately, the question is whether Word, performing what are undoubtedly commercial business activities, could itself qualify as a "charitable institution" with religious purposes and thus be exempt from paying income tax. The answer to that question is to be found in the 1997 Act, read in the way described. The legislation As the joint reasons explain97, the applicable provisions of the 1997 Act are to be found in Div 50 of Pt 2-15. These provisions govern Word's claim to be exempt from the liability that would otherwise attach to it in respect of its income as an investment and commercial funeral business organisation. Word claims to be a "charitable institution". Such an institution is defined as an "entity" by Item 1.1 of the table set out in s 50-5 of the Act. An "entity" is not exempt unless "endorsed", as such, by the Commissioner under subdiv 50-B. The joint reasons explain the way in which the Commissioner is obliged to consider applications for endorsement (twice made unsuccessfully by Word)98. It is unnecessary for me to repeat this material. Similarly, the joint reasons explain the particular requirement of s 50-110(5)(a) of the 1997 Act that Word satisfy the "Special conditions" mentioned in Item 1.1 of the table. One of the "Special conditions", required by s 50-50(a), is that the "entity" has: "a physical presence in Australia and, to that extent, incurs its expenditure and pursues its objectives principally in Australia". 95 (2006) 64 ATR 483 at 497 [61]. 96 (2007) 164 FCR 194 at 196 [1], 209 [65], 223 [107]. 97 Joint reasons at [6]. 98 Joint reasons at [7]. Kirby Failure to conform to this condition would mean that Word would not fulfil a necessary requirement of the 1997 Act. It could not, therefore, be an in s 50-5. institution" under Item 1.1 of exempt "charitable Accordingly, that "Special condition" was a threshold statutory requirement for Word. Failure to satisfy that requirement would make redundant all other issues in this appeal as litigated. The other anterior questions as to whether, according to the general law, Word qualifies as a "charitable institution" only arise if that "Special condition" is satisfied. table the This appeal thus presents both a special and a general statutory question. The special question is the applicability of the "Special conditions" identified. The general question involves the other arguments raised by the Commissioner against Word's entitlement to be recognised as a charitable or religious institution. Logically, it is appropriate to deal first with the relevant "Special condition". If it cannot be satisfied, everything else said in this appeal constitutes obiter dicta. The joint reasons explain in some detail the propounded "Special condition" (described as the "fourth issue")99. Specifically, they describe the requirements in s 50-50 of the 1997 Act100; the legislative context of that provision101; various counterparts for s 50-55(a) elsewhere in the Act102; and the powers of the Commissioner to seek information from an entity claiming to be entitled to an endorsement as exempt from income tax and the entity's corresponding obligation to comply with such a request103. The joint reasons also describe the earlier provisions of federal income tax law that provided for exemption from income tax of the income of charitable and religious institutions104. They outline the way the particular language of what is now s 50- 50(a) of the 1997 Act came into the Income Tax Assessment Act 1936 (Cth) ("the 1936 Act") as s 23(e)105. They set out extracts from the Explanatory 99 Joint reasons at [46]. 100 Joint reasons at [50]. 101 The table in the 1997 Act, s 50-5. See joint reasons at [49]. 102 1997 Act, ss 50-55(a), 50-60(a), 50-65(a), 50-70(a). Joint reasons at [50]. 103 1997 Act, s 50-140(1). See joint reasons at [55]-[57]. 104 Notably Income Tax Assessment Act 1915 (Cth), s 11(d); Income Tax Assessment Act 1922 (Cth), s 14(1)(d); Income Tax Assessment Act 1936 (Cth), s 23(e); and provisions for exemption of the income of a trust for charitable purposes. See joint reasons at [58]-[61]. 105 Joint reasons at [62]. Kirby Memorandum that was furnished with the applicable Bill106. Finally, the joint reasons describe the way in which the requirement now appearing in s 50-50 was inserted in the 1997 Act and outline the relevant Explanatory Memorandum107. I accept, without repeating, this description of the background. I can now deal with what I regard as the first (and ultimately decisive) issue in the appeal, namely that presented by s 50-50(a) of the 1997 Act. I will then deal with the other issues argued in case my conclusion on the first issue is wrong. It is useful at the outset to set out some general propositions concerned with the approach to be taken to the legal issues in dispute; to collect some of the legal principles that the case raises; and to identify certain considerations of legal policy that need to be considered in deciding all of the applicable issues. Legal principle and policy Appellate requirement of error: The appeal comes to this Court under the Constitution108. This Court is a court of error. The Commissioner must establish error in the reasons of the court below if this Court is to be authorised to set aside the judicial orders earlier made. Absent established error, it is not the function of this Court simply to decide the matter for itself or to substitute its conclusion on the facts for that reached by the decision-makers below. In the reasons both of the primary judge and the Full Court of the Federal Court, there was a high degree of unanimity on the application of the 1997 Act to the special and general questions raised in the Commissioner's submissions. Although the AAT partly accepted the Commissioner's submissions on the general questions, its conclusion that Word was "not … itself a charitable institution whilst operating [its] business"109 was the Commissioner's only victory so far in this protracted litigation. fact The that experienced the Commissioner's submissions is a reason to pause before deciding that error has occurred and giving effect to a contrary conclusion. However, after a grant of special leave, this Court must consider whether error has been shown and, if so, it must identify and correct that error. judges have concluded against 106 Joint reasons at [63]-[64]. 107 Joint reasons at [65]-[68]. 108 Constitution, s 73(ii). 109 Re Applicant and Federal Commissioner of Taxation (2005) 60 ATR 1265 at 1270 Kirby Special and general statutory provisions: As the statutory materials set out in the joint reasons demonstrate, the 1997 Act incorporates both special and general requirements. These are what must be fulfilled for an Australian entity, otherwise in receipt of taxable income, to be exempt from income tax as a charitable or religious institution. The special provisions are found in the comparatively new and additional requirements now appearing in s 50-50(a) of the 1997 Act. The general provisions arise in the appeal because of the use in the 1997 Act (as earlier in the 1936 Act and indeed the original federal income tax statutes) of concepts such as "charitable purposes", "charitable institution" and "religious institution". These concepts are taken to be derived, through Pemsel and other decisions, from the Statute of Elizabeth which gave rise to a "technical" meaning of these phrases. It is common ground that those phrases pick up and apply judicial elaborations of such expressions as found in legislation and other similar legal texts in Australia, the United Kingdom and other countries of the same legal tradition. Section 50-50(a) is a disqualifying provision. "[C]haritable institution" (Item 1.1) and "religious institution" (Item 1.2) are set out in the table to s 50-5 of the 1997 Act. Section 50-50(a) makes it clear that such institutions, even if otherwise satisfying all of the requirements of the Act and of the common law that preceded it, will nonetheless not be exempt from income tax if the stated preconditions are not met. The applicable precondition here is that the entity concerned has, at the relevant time, "a physical presence in Australia and, to that extent, incurs its expenditure and pursues its objectives principally in Australia". Consequently, I will deal first with what the joint reasons describe as the "fourth issue"110. It affords the speediest and most direct route to an outcome favourable to the Commissioner, if his argument on s 50-50(a) succeeds. Taxpayers' burden of persuasion: The 1997 Act, like the 1936 Act and others before it, imposes an obligation upon Australian taxpayers to pay income tax on income received during the taxation year. In the circumstances of this case it follows that the burden of persuasion is on Word to establish that it fell within an exemption provided for charitable or religious institutions. In Canada, it has been held that exemption provisions are subject to a "strict construction" in statutes that otherwise impose an obligation to pay a generally applicable tax111. This approach may not now generally accord with 110 Joint reasons at [46]-[74]. 111 Kennebecasis Valley Recreational Centre Inc v Minister of Municipal Affairs of New Brunswick (1975) 61 DLR (3d) 364 at 371. Kirby the Australian approach to the construction of taxing statutes112. However, it remains the fact that Word is attempting to secure for itself a special privilege provided by a statutory exemption of charitable and religious institutions from the general liability to pay tax upon income. Throughout this litigation, it was therefore Word that bore at least the forensic obligation to bring itself within the exempting provisions of the 1997 Act. Word did not contest that burden. It is enough to say that, in approaching any questions of uncertainty in the facts or the governing law, it is Word that is looking for favours under the Act. Certainly, it received income from its investment and commercial funeral business activities. Prima facie such income was taxable. Word must establish any exemption. Importance of income tax: The first income tax statute in Australia was enacted in Tasmania in 1880 with a withholding tax on dividends, annuities and rents113, followed by a general income tax statute in South Australia in 1884114. By 1907, all of the States had similarly introduced income tax, whilst the first federal income tax was introduced in 1915115. Since then, the demands upon and activities of the federal government have expanded greatly, with consequent demands on the revenue of the Commonwealth. As Gummow, Hayne and Crennan JJ observed in White v Director of Military Prosecutions116, a "modern regulatory state arrived after 1900 and did so with several pertinent consequences". One such consequence was a significant increase in the need for revenue to support the expanding activities of the government of the Commonwealth. Those activities are performed for all people in Australia – 112 The classic approach was for taxation exemption provisions to be construed in favour of the entity claiming the exemption. See Burt v Commissioner of Taxation (1912) 15 CLR 469 at 482 per Barton J, 487 per Higgins J; [1912] HCA 74; Armytage v Wilkinson (1878) 3 App Cas 355 at 369-370. More recent authorities have adopted a range of approaches to construction. See State Transport Authority v Corporation of the City of Adelaide (1980) 24 SASR 481 at 484 per Wells J; cf Diethelm Manufacturing Pty Ltd v Commissioner of Taxation (1993) 44 FCR 450 at 457 per French J. See generally Pearce and Geddes, Statutory Interpretation in Australia, 6th ed (2006) at 305-306 [9.44]. 113 Real and Personal Estates Duties Act 1880 (Tas), s 3. 114 Taxation Act 1884 (SA), s 9. 115 Income Tax Assessment Act 1915 (Cth). See Vann, "Part One: General Description – Australia", in Ault and Arnold, Comparative Income Taxation: A Structural Analysis, 2nd ed (2004) 3 at 3. 116 (2007) 231 CLR 570 at 595 [48]; cf at 637-638 [189]-[193]; [2007] HCA 29. Kirby citizen and non-citizen, natural and legal persons, those who are religious and those who are non-religious. Charitable and religious institutions contribute to society in various ways. However, such institutions sometimes perform functions that are offensive to the beliefs, values and consciences of other taxpayers. This is especially so in the case of charitable institutions with religious purposes or religious institutions. These institutions can undertake activities that are offensive to many taxpayers who subscribe to different religious beliefs or who have no religious beliefs. Although the Parliament may provide specific exemptions, as a generally applicable principle it is important to spare general taxpayers from the obligation to pay income tax effectively to support or underwrite the activities of religious (and also political) organisations with which they disagree. This states a reason of constitutional principle for ensuring that any exemption of a "charitable institution" with religious purposes or any specific "religious institution" does not extend beyond an exemption that is clearly provided by law. Any ambiguity as to the ambit of an exemption for such an institution should therefore be construed against the claimed exemption and in favour of liability of that body to pay otherwise generally applicable tax obligations. As Lord Simonds remarked in Oppenheim v Tobacco Securities Trust Co Ltd117, "[i]t must not, I think, be forgotten that charitable institutions enjoy rare and increasing privileges, and that the claim to come within that privileged class should be clearly established." Constitutional secularism: In the Australian context, the foregoing considerations are reinforced by the language of s 116 of the Constitution. Although, to the present time, this Court has interpreted that provision narrowly118, it is not devoid of meaning or purpose. In several respects it follows the language of the First Amendment to the Constitution of the United States. That Amendment has been interpreted broadly to uphold a separation between religion and the constitutional polity119. Section 116 was obviously included in our Constitution for a similar general purpose. And apart from the section, for clear historical reasons, the secular character of the Commonwealth and its laws 117 [1951] AC 297 at 307. 118 See eg Krygger v Williams (1912) 15 CLR 366 at 369; [1912] HCA 65; Adelaide Company of Jehovah's Witnesses Inc v The Commonwealth (1943) 67 CLR 116 at 130-131; [1943] HCA 12; Attorney-General (Vict); Ex rel Black v The Commonwealth ("the DOGS Case") (1981) 146 CLR 559 at 579, 604, 612, 653; [1981] HCA 2. 119 See DOGS Case (1981) 146 CLR 559 at 614 per Mason J; cf at 610 per Stephen J. Kirby and the separation of the governmental and religious domains constitute settled features of constitutionalism in this country. The decision of this Court in Combet v The Commonwealth120 considered an analogous requirement for citizens, by their taxation, effectively to support widespread governmental political advertising of opinions with which many citizens might have disagreed. In my reasons in Combet, I referred to the opinion of Souter J in the Supreme Court of the United States in Johanns v Livestock Marketing Association121. His Honour there quoted, and applied, Thomas Jefferson's 1779 statement that "to compel a man to furnish contributions of money for the propagation of opinions which he disbelieves … is sinful and tyrannical"122. Yet exempting charitable and religious institutions from income tax may effectively have the same consequence. Such institutions are the beneficiaries of public services like everyone else. However, unlike everyone else, they are excused from contributing to income tax, the universal liability to which has been such a long-established feature of the general economic success of the Australian Commonwealth. No constitutional objection to the exemption of charitable and religious institutions from income tax was raised in this appeal. However, Word's claim to the statutory exemption falls to be determined in a society, and a system of law, that generally upholds secular government and maintains a divorce between personal religious beliefs and governmental favours. A taxation exemption for religious institutions, so far as it applies, inevitably affords effective economic support from the Consolidated Revenue Fund to particular religious beliefs and activities of some individuals. This is effectively paid for by others. It involves a cross-transference of economic support. The courts must recognise that this is deeply offensive to many non- believers, to people of different faiths and even to some people of different religious denominations who generally share the same faith. As the provision of public economic support can obviously favour particular religions, courts are guardians of neutrality. Courts thus act properly when they approach claims to statutory exemption from the payment of income tax of such charitable and religious institutions with a degree of strictness. Certainly, courts should do this where the relevant income is derived from investment and commercial business 120 (2005) 224 CLR 494; [2005] HCA 61. 121 544 US 550 (2005). See (2005) 224 CLR 494 at 584 [186]. 122 544 US 550 at 572 (2005). See also United States v United Foods Inc 533 US 405 Kirby activities and is to be devoted specifically to proselytising activities, such as translation and distribution of the religious texts of a particular religion. On the face of things, charitable and religious institutions should share with other Australian taxpayers the liability to pay income tax upon their income. Exemption needs to be clearly demonstrated as conformable to law. Any ambiguity should be construed so as to deny a claimed exemption that is not clearly justified in law. Context of exemptions: A wide range of exemptions for charitable and religious institutions is already afforded in Australia under federal and State law. This is an additional consideration to suggest the need for the strict scrutiny of arguments for expanding statutory exemptions to apply to such institutions. The broad ambit of such exemptions is specially notable when contrasted to the international treatment of such non-profit ventures when they engage with other countries in investment or commercial business activities. In 1995, the Australian Industry Commission conducted a review of charitable organisations in Australia123. On the specific issue of the income tax exempt status of charities, the Commission concluded that such exemption did not compromise competitive neutrality between organisations124. However, its report reveals that this conclusion was contested by organisations that were in commercial competition with the business arms of such bodies125. Referring to the taxation regimes then applicable in Australia, the competitors emphasised that income tax exemptions were not the only such exemptions applicable. The exemptions also included federal sales and fringe benefits taxes, State payroll and land taxes, and other taxes and charges126. The report contrasted the international treatment in comparable countries of commercial activities of non-profit organisations127. It found that the law in most of those countries subjected non- 123 Australia, Industry Commission, Charitable Organisations In Australia, Report No 45 (June 1995) ["Industry Commission Report"]. Appendix K, entitled "CSWOs [Community social welfare organisations] and competitive neutrality", discussed specifically the issue of the exemption of charitable organisations from tax obligations and competitive neutrality. 124 Industry Commission Report at K 5 [K.2.4]. 125 See, for example, Industry Commission Report at K 8 [K.3.1] (nursing homes), K 9-K 10 [K.3.1] (fitness providers), K 10 [K.3.2] (hospitals). 126 Industry Commission Report at K 7 [K.3]. 127 Austria, Belgium, Israel, Spain, Thailand, the United Kingdom, the United States and West Germany at K 5 [Table K.1]. Kirby profit organisations, including charitable and religious institutions, to taxation in respect of income derived from their commercial activities128. By this standard, an Australian exemption of such income would appear to be exceptional if expanded to a case such as the present. It is hard to deny that, at the very least, the infrastructure and management costs of providing for tax liabilities in non- exempt investment and commercial business organisations, performing similar functions to Word, would significantly increase costs compared to those of the exempt Word. The scheme of the 1997 Act provides that the exemption claimed by Word is not there just for the asking. A funeral business in competition with the funeral business operated by Word is entitled to expect that the provision to Word of the special exemption from income tax (with consequential savings in infrastructure costs) should be clearly demonstrated where the Commissioner contests it. This is especially so because, despite the high sounding "philosophy" adopted for the conduct of its funeral business, Word specifically acknowledged that it would be run as a "professional … business" with expansion of its activities into related businesses; an objective of securing a "margin of profit"; a search for "new business opportunities"; and with no confinement of its services specifically to the funerals of Christian believers or Wycliffe supporters. In short, Word's aim was (as it stated) "[to] enable [it] to capture a section of the current market". In a secular society, an exemption will be provided to "charitable institutions" with religious purposes or to religious institutions because such a society respects the religious consciences of persons living there. However, to the extent that such institutions engage in investment and commercial business undertakings with a view to profit, they invite upon themselves a strict scrutiny. In such a case, they are in competition with others in the marketplace who do not enjoy any of the economic advantages that the exemption affords. Width of "religion": There is a further consideration. In respect of the exemption from State payroll tax, this Court has adopted a broad view of "religion"129. In his reasons for upholding that view, Murphy J concluded that any attempt "to determine what religion is … poses a threat to religious freedom"130. 128 Industry Commission Report at K 5 [Table K.1]. 129 Church of the New Faith v Commissioner of Pay-roll Tax (Vict) (1983) 154 CLR 120 at 135, 150, 173; [1983] HCA 40. 130 (1983) 154 CLR 120 at 150. Kirby For consistency, it appears inevitable that a similar view would be taken about the "religions" that might become the purpose of a "charitable institution" with religious purposes or a "religious institution" that is granted exemption under the 1997 Act. The classification could not be confined to Christian institutions that generally propound doctrines familiar to the courts. In a society such as Australia, the characterisation would have to extend to a very large range of "religious" beliefs. Then, according to the proposition advanced by Word, it would have to extend to bodies which, although not themselves engaged in propagating religious beliefs, constitute the "commercial arms" of such bodies. The potential significance of the expansion of the category of exemptions immediately becomes plain. It is at least open to doubt that charitable and religious institutions that have traditionally been exempted from income tax liability in Australia would necessarily share their generally tolerant and mutually respectful attitudes with at least some institutions claiming "religious" purposes and objects. Thus, to exempt commercial bodies established to provide subventions for overseas televangelists or for overseas madrasas teaching religion to very specialised groups potentially stretches significantly the application of the exemption in the 1997 Act. At the least, such an exemption presents a serious question as to whether it was truly what the Australian Parliament intended when it enacted s 50-50(a) of the 1997 Act. As it happens, my own religious tradition, and that of many Australians, is that derived from John Wycliffe, the "Morning Star" of the Christian Reformation in England131. Providing an exemption to an institution such as Wycliffe or Wycliffe International is comprehensible to me and arguably within the Parliament's purposes. However, the issue must be decided neutrally. Expanding the exemption to other unknown "charitable institutions" with religious purposes or to "religious institutions", especially to investment and commercial funeral or like business enterprises established to compete in the market with others and to provide funds for the religious objectives of such institutions, presents concerns that cannot be ignored in the present case. In short, to the extent that the exemption is confined to "institutions" that are themselves religious in character, purpose and activities, the law draws what is arguably the intended and limited boundary of the specially privileged class. In a society such as Australia, there are only a limited number of people engaged in such institutions and providing income to them. The class is necessarily greatly expanded if the income tax exemption is expanded to include investment and commercial business activities that are somehow linked with such institutions. This would potentially increase the application of the exemption 131 Word Investments Ltd (2006) 64 ATR 483 at 485 [1]. Kirby significantly and likewise enlarge the potential revenue thereby lost to the Commonwealth. It follows that, arguably, if the expansion of the exemption to a company such as Word is to be sanctioned by law, it should be done by express legislation enacted for that purpose by the Parliament after a full debate about the issues of principle and policy that are raised. Likewise, in so far as the recent enactment of s 50-50(a) of the 1997 Act may be thought to respond to this new phenomenon, it should be given an interpretation that confines the ambit of the exemption rather than one that would expand it. The issues The joint reasons accept that there are four issues in this appeal, identified by reference to the Commissioner's arguments132. In my opinion, for the reasons already stated133, there are two essential issues. They should be decided in descending order of particularity. They are: The "Special conditions" issue: If every other requirement for exemption were established, is Word disentitled from being an entity endorsed as exempt from income tax as a "charitable institution" with religious purposes because it does not comply with s 50-50(a) of the 1997 Act? Although Word undoubtedly "has a physical presence in Australia" within that provision, does it "to that extent, incur its expenditure and pursue its objectives principally in Australia"?134; and The charitable institution issue: If Word is an entity that satisfies the requirements of s 50-50(a) of the 1997 Act, is it nonetheless disentitled to an exemption from income tax? There are two aspects of this issue: Is Word not properly characterised as a "charitable institution" within the law governing the meaning of that phrase because Word's own objects are not confined, to the requisite degree, to "charitable purposes"? Are they instead more properly to be characterised, including by reference to Word's actual activities, as 132 Joint reasons at [8]. 133 See above, these reasons at [102]-[105]. 134 This represents the fourth issue stated in the joint reasons at [46]-[74]. Kirby an investment or commercial business corporation deriving income for profit, thus taxable in the ordinary way under the 1997 Act135? The ultimate disposition of the profits of Word's investment and commercial funeral business activities is to entities that are themselves charitable or religious institutions. If Word would otherwise constitute a "charitable institution", is it entitled to the exemption given that the beneficiaries of its profits are not themselves legally confined as to how they might use the funds136? The "Special conditions" issue The issue stated: The first question is whether Word is an entity that is entitled to endorsement as exempt from income tax, complying with the requirements of s 50-50(a) of the 1997 Act. Specifically, to the extent that Word "has a physical presence in Australia", the question is whether it "incurs its expenditure and pursues its objectives principally in Australia". The courts below, and now a majority in this Court, have concluded that Word has fulfilled all of the conditions for the application of the exemption. I agree (and it has not been contested) that Word has a "physical presence in Australia". Thus the relevant question is whether, to that extent, Word "incurs … and pursues its [charitable] objectives principally in Australia". The majority in this Court answer this in the affirmative by taking a narrow view of what is involved in Word's incurring its expenditure and pursuing its objectives within Australia. Their approach is that the "objectives" are as stated in Word's constituting document. As far as Word is concerned, it fulfils its objectives (and incurs its expenditure) in Australia when it pays income to Wycliffe (and to Wycliffe International and other charitable beneficiaries as required by its constituting document) so that no difficulty arises in complying with s 50-50(a) of the 1997 Act. This approach sees no difficulty in the fact that 135 This represents an amalgam of the first and second issues stated in the joint reasons 136 This represents an amalgam of the third issue stated in the joint reasons at [40]-[45] and of arguments based on reasoning in the Supreme Court of Canada in R v The Assessors of the Town of Sunny Brae [1952] 2 SCR 76 at 92 ("the Sunny Brae Case"). That Court emphasised that the "ultimate destination" where a body directs its income is not a determinative criterion of the character of a "charitable" or "religious institution". Kirby the destination of the income that is subject to the tax exemption is (and always was intended to be) principally outside Australia137. This is an erroneous reading of the requirement of s 50-50(a) as demonstrated by the language of the provision, its apparent purpose, its history, its stated objectives and its reasonable application in Australia, applied in light of the general considerations of legal principle and policy that I have already mentioned. The proper conclusion is that the requirement of s 50-50(a) was not satisfied in this case. Word is not therefore an "entity" entitled to exemption from income tax as a "charitable" or "religious institution". For obvious reasons, Word framed its argument in terms of its suggested status as a "charitable institution". No doubt, it considered that it would be more difficult to satisfy the courts that it was a "religious institution", given the colouration of its character by its investment and commercial funeral business activities. However, Word's claim to be a "charitable institution" is based upon provisions in its constituting document that express objects and purposes argued to be for the advancement of religion, a recognised "charitable purpose". Thus the fundamental dilemma posed for the proper characterisation of Word persists. How could a company engaged in investment and commercial funeral business activities for a profit truly be a "charitable enterprise" merely because it ultimately disburses parts of its income to religious institutions? Charitable institutions and non-charitable objects: Federal income tax statutes in Australia, since 1916, have drawn a distinction between the income of religious, scientific, charitable and public educational institutions and the income of a fund established for public "charitable purposes"138. The legislation has specifically required the income of such a fund to be applied for the purposes for which the fund was established. There is no such requirement for an exempt "institution". By inference, this is because the very character of the "institution", without more, means that it will be "an establishment, organization, or association, instituted for the promotion of some object, especially one of public utility, religious, charitable, educational etc"139. Obviously, a "charitable institution" may have some non-charitable objects. The presence of these will be accepted but only so long as they are incidental or ancillary to the institution's charitable objects. The introduction of 137 Joint reasons at [73]. 138 See the legislation set out in the joint reasons at [60]-[61]. 139 Stratton v Simpson (1970) 125 CLR 138 at 158 per Gibbs J (citing The Shorter Oxford English Dictionary); [1970] HCA 45. Kirby the relevant statutory provisions governing "charitable institutions", in the tabular form set out in the 1997 Act, did not change the substance of the previously enacted provisions. It must be assumed that the Parliament intended to continue to apply the institutional provisions stated in Stratton v Simpson140 to the analogous exemptions enacted by the 1997 Act. The Explanatory Memorandum distributed with the Taxation Laws Amendment Bill (No 4) 1997 (Cth) explains the purpose of altering s 23(e) of the 1936 Act. That amendment inserted the additional requirements for obtaining a tax exemption that later became the "Special conditions" contained in ss 50-50 and 50-60 of the 1997 Act141. The Explanatory Memorandum cites two reasons for amending the 1936 Act to remove the tax exemptions for (among others) charitable and religious institutions that are "located or pursue their objects offshore". It was142: "[T]o prevent: certain organisations to shift untaxed funds overseas; and tax avoidance arrangements which could use these a transfer of revenue from Australia to a foreign country where income is exempted in Australia but not in the organisation's country of residence." Previous requirements were retained, but a number of stronger requirements were added. In particular, a precondition for exemption was added143, namely that charitable and religious institutions must establish that they have a physical presence in Australia and, to that extent, incur their expenditure and pursue their objectives principally in Australia. Analogous requirements were introduced for "charitable purpose" funds144. At the same time separate provision was made for a "prescribed" institution to be exempted if it had a 140 (1970) 125 CLR 138 at 159-160 citing Congregational Union of New South Wales v Thistlethwayte (1952) 87 CLR 375 at 442, 450; [1952] HCA 48; Oxford Group v Inland Revenue Commissioners [1949] 2 All ER 537; In re Harpur's Will Trusts [1962] Ch 78 at 87. 141 See above, these reasons at [97] and joint reasons at [65]-[68]. 142 Explanatory Memorandum, Taxation Laws Amendment Bill (No 4) 1997 (Cth) 143 Section 23(e)(i) of the 1936 Act; s 50-50(a) of the 1997 Act. 144 Section 23(j)(iia) of the 1936 Act; s 50-60 of the 1997 Act. Kirby physical presence in Australia and incurred its expenditure and pursued its objectives principally outside Australia145. The objects of s 50-50(a) of the 1997 Act: The submissions of the Commissioner were correct concerning the meaning and operation of s 50-50 as it applied to a propounded "charitable institution" such as Word. There were several objects of the dual requirements of physical presence in Australia and the pursuit of objectives principally in Australia: To avoid or reduce the risk of such exemptions being used for tax avoidance where income, freed from income tax liability within Australia, could be transferred offshore. Once in another jurisdiction, the Commissioner's power to check the deployment of the funds as claimed would be seriously reduced or lost altogether; To ensure that the entity seeking exemption could establish, by its presence and activities in Australia, an entitlement to the exceptional privilege of exemption as deemed necessary by the Parliament for the application of the exemption; To reconcile the provisions of s 50-50(a) and the arrangements contemplated by s 50-50(d), a "charitable institution" that incurs its expenditure and pursues its activities principally outside Australia may still be exempt from tax otherwise applicable to its Australian income. However, this will only be so if the institution is expressly prescribed by regulation for that purpose. The objective of s 50-50(d) is explained in the Explanatory Memorandum to the Taxation Laws Amendment Bill (No 7) 1997 (Cth)146 (which amended the 1997 Act). The requirements for explicit prescription, as contemplated by s 50-50(d), provide a dual protection to the revenue. First, the prescription-maker must consider any exemption on a "case by case basis". Secondly, the Parliament may then examine the type, designation and number of such prescribed institutions. These are inappropriate, suspicious (or, for that matter, inadequate) exemptions by prescription for "charitable institutions" carrying out their activities principally outside Australia. The "case by case" provision for such institutions affords a strong argument against the narrow reading of s 50-50(a) now adopted in the joint reasons147; and important protections against excessive, 145 Section 23(e)(iv) of the 1936 Act; s 50-50(d) of the 1997 Act. 146 See at [3.21], [3.22]. 147 See joint reasons at [73]. Kirby (4) Does the obligation to carry out charitable activities principally within Australia (and to have a physical presence in Australia) represent an unduly xenophobic reading of s 50-50(a)? Does it neglect the interests of a country such as Australia to support the need for charitable activities overseas? Any criticism of such a reading of s 50-50(a) is adequately met by the Commissioner's legitimate need to secure added protections to prevent turning charitable exemptions into a means of tax avoidance; the greater potential for avoidance in offshore activities; and the safety hatch provided by the power to prescribe offshore charitable activities specifically on a "case by case" basis. It was open to the Parliament to grant exemptions for charitable activities principally pursued (with the consequent expenditure incurred) in Australia. The Parliament provided this by understandable given the principle and policy considerations already mentioned. This is especially the case for "charitable institutions" pursuing religious purposes offshore. Such activities have no immediate advantage revenues substantially raised by income taxes for the provision of government services. for Australians who are language of s 50-50(a). This conclusion reliant on the clear instead Errors of the contrary conclusion: The majority's conclusion about the meaning of s 50-50(a) is, with respect, erroneous. It is a result of reading the requirements of s 50-50(a) without giving sufficient attention to the language of the provision, its history and its stated purposes. It is irrelevant to argue, as the joint reasons do, that the tax avoidance purpose of s 50-50(a) is immaterial because "[t]he Commissioner did not suggest in the present appeal that Word and Wycliffe were engaged in 'tax avoidance'"148. This confuses the relevance of the purpose of anti-avoidance and the purpose of a particular taxpayer or exempt entity's activities. The present question is what the Parliament was seeking to do through the language of s 50-50(a). That understanding assists in giving an accurate meaning to the provision. The section is then interpreted so as to apply equally to those who are engaged in tax avoidance and those who are not. Once this fact is recognised, the obligation in s 50-50(a) becomes more understandable. It is an obligation imposed inter alios on Word. The joint reasons state that the charitable objectives were easily fulfilled by what Word did in Australia alone149. Unless that conclusory approach is adopted, the need to 148 Joint reasons at [63]. 149 Joint reasons at [73]. Kirby give an informal meaning to the new requirement of pursuing the charitable "objectives principally in Australia" remains. In the factual circumstances of the present case, the "charitable purposes" pursued by Word were principally overseas, not in Australia. By way of contrast, the purposes of Word in Australia were investment and commercial funeral business activities. The Commissioner's interpretation of s 50-50(a) is convincing and is to be preferred once it is appreciated that the object of s 50-50(a) was to afford the Commissioner a means of preventing, or responding to, the risk of tax avoidance; to provide a means of tracing effectively the money trail alleged to be "charitable" and keeping it principally at home; and to provide for "case by case" approval where the money trail leads to charitable activities principally pursued outside Australia. A further error: An additional error of the joint reasons appears in the narrow reading of s 50-50(a)150. This is said to produce a conclusion that the language of s 50-50(a) is "intractable". I agree; but I reach exactly the opposite outcome. The starting point, which I do not accept, is that Word escapes the propounded meaning of s 50-50(a) by demonstrating that it was not itself involved in tax avoidance. Word argued that decisions to pay moneys (to Wycliffe, Wycliffe International and other bodies) were made in Australia. Nothing in s 50-50(a) obliged such organisations (including Wycliffe and Wycliffe International) actually to expend their moneys in Australia. It was said that s 50-50(a) draws no distinction between direct and indirect effects. Section 50-50(a) instead requires that for an "entity" to gain an exemption as a "charitable institution" (as distinct from the investment or commercial funeral business that Word otherwise appears to be) it must demonstrate the dual requirements of s 50-50(a). Word had to pursue its charitable objectives (and incur its expenditure) "principally in Australia". Moreover, that phrase is to be understood in light of its objects to minimise the risks of tax avoidance; to permit scrutiny and effective investigation by the Commissioner; and normally to confine the objectives to those that are pursued principally in Australia. If they were to be pursued principally outside Australia, this had to be authorised individually, as s 50-50(d) contemplated. Word made the claim that it was pursuing "charitable purpose" objectives. As a precondition to endorsement of exemption from income tax, the language and object of s 50-50(a) required Word to incur its expenditure and pursue its 150 Joint reasons at [73]-[74]. Kirby objectives "principally in Australia". The interpretation adopted in the joint reasons does not give effect to the apparent purpose of the provision. A still further error: The joint reasons also err in their stated opinion that the Commissioner's contention that Word's submission would present him with difficulty in monitoring funds is "exaggerated in the light of s 50-145"151. In support, the joint reasons argue that, if "the Commissioner had reason to suspect that funds given by Word to Wycliffe were not being expended on charitable objects", he had the "power to request … information and documents" and to subject Word (in the case of default) to criminal liability. There are many reasons why this argument is unconvincing. First, the objective of s 50-50(a) is to provide a precondition to entitlement. Its purpose is to avoid the necessity of ex post interrogation where, inevitably, the Commissioner and his officers would be at an informational disadvantage. By confining the pursuit of the charitable objectives to be "principally in Australia", as s 50-50(a) does, the Commissioner is not forced to rely on questioning and invoking criminal sanctions to overcome the information deficit. Within Australia, the Commissioner has his own employees and agents to perform such investigations. He enjoys much more available means than elsewhere for investigating the payments for allegedly "charitable purposes" to parties other than the entity in question itself. Secondly, the joint reasons repeat the mistake of assuming that the meaning of s 50-50(a) is to be derived by reference to the imputed behaviour of Word alone. It is not. The purpose of s 50-50(a) is to enable the Commissioner to deal systematically with alleged entities who may have attempted to use the entity exemption for "charitable" or "religious institutions" as a means of tax avoidance. Section 50-50(a) must be interpreted to give effect to its large institutional and anti-avoidance purpose. It must not be confined to the particular application to Word. Thirdly, even in the case of an honest entity like Word, there is an enlarged risk that its payment of subventions for the pursuit of Word's charitable objectives overseas may haemorrhage. They may do so in ways that Word, Wycliffe and Wycliffe International never intended. Section 50-50(a) was introduced into the 1997 Act to prevent and redress that potential problem. It is impossible to deny that the Commissioner can monitor and ensure the integrity of a flow of funds much more easily where the pursuit of the objectives is principally in Australia rather than overseas. To do so overseas might be 151 Joint reasons at [72]. Kirby difficult, or even impossible. It is a small comfort to answer this contention by saying that the Commissioner can always pursue local criminal sanctions against the entity present in Australia. This does not address the institutional or organisational needs of the Commissioner, with his legitimate obligations to defend the revenue and to redress and discourage tax avoidance. Factually: principally overseas objectives: If the interpretation of s 50-50(a) urged by the Commissioner is adopted, do the facts of Word's case warrant a conclusion that Word's charitable objectives were pursued principally outside Australia? The investment and commercial funeral business activities of Word that were conducted wholly within Australia did not involve charitable objectives that would attract exemption under the Act. Any charitable "objectives" were pursued mainly through Wycliffe and Wycliffe International which arranged the Bible translations. They were not performed by Word itself. The evidence before the AAT and the agreed facts in the Federal Court reveal that some Bible translation for indigenous peoples with hitherto unwritten languages took place in Australia, out of Darwin and Alice Springs. However, it was conceded that this activity was "now less active than it was previously". As the joint reasons state, the uncontested evidence was that Wycliffe and Wycliffe International were seeking to spread the Christian religion through particular activities "in developing countries, and among sections of the population who have no written language"152. More specific evidence from Word about these activities indicated how Word "achieves its religious objects in practice", by securing the publication of the Bible "in the mother tongue or 'heart language' of peoples in all parts of the world … [including] the Australian Aborigines, the indigenous people of Papua New Guinea, and people in Indonesia, Africa and South America". The pursuit of the same objective in the Philippines was also mentioned. It follows that the only conclusion available from this evidence, including the particularisation of the claim for exemption by Word's lawyers, is that the "charitable purposes" relied on by Word were pursued principally outside Australia. Once Australia's Aboriginal peoples are effectively excluded, the very nature of the "charitable purposes" relied on confined the pursuit of Word's charitable objectives to overseas activities. On this issue, the evidence spoke with a single voice. 152 Joint reasons at [2]. Kirby With this conclusion, it is impossible for Word to comply with the requirement stated for endorsement as an "entity" exempt from income tax under s 50-50(a) of the 1997 Act. Word had a physical presence in Australia. But in so far as it pursued any charitable objectives, it did so principally outside Australia. It was therefore not an entity entitled to exemption. Conclusion on s 50-50(a) of the 1997 Act: The foregoing conclusion is fatal to Word's case. The other ingredients necessary for exemption as a "charitable institution" under the general law might attract the operation of the other provisions of the 1997 Act. But without compliance with s 50-50(a), Word was disentitled. The entity could not then be endorsed as exempt from income tax. This conclusion is not surprising once the language and purposes of s 50-50(a) (read with s 50-50(d)) are understood. The exemption is exceptional. Without saying anything about Word, the exemption it sought is susceptible to misuse, dishonesty and tax avoidance. To that end, the Australian Parliament has enacted "Special conditions" designed to enhance the Commissioner's capacity to monitor the money trail of expenditures on claimed "charitable purposes" and the pursuit of such objectives. One such express requirement is that the pursuit of the charitable objectives should be "principally in Australia". In so far as Word had charitable objectives (as distinct from investment and commercial funeral business objectives for profit) it did not pursue those "objectives principally in Australia". It pursued them through other entities and principally overseas. It was therefore not qualified for exemption from income tax. The Commissioner was correct to so decide. Even assuming all other considerations might be found in favour of Word, the foregoing conclusion requires that the Commissioner's appeal be allowed. The "charitable institution" issues Remaining issues in the appeal: Mine is a minority opinion and my reasons thus far are sufficient to sustain the orders that I favour. However, it is appropriate for me to address the other issues argued in support of the Commissioner's submissions. Out of respect for the importance of these issues, the careful arguments of the parties and my disagreement with the joint reasons, I will respond to the question whether, in the facts of this case, Word otherwise qualified as a "charitable institution" for the purposes of the 1997 Act. The 1997 Act (like its predecessors) does not define the term "charitable institution". However, it is settled law in this Court that, if the entity claiming exemption from income tax is an "institution" for the purposes of the law, it is Kirby "charitable" if it has "charitable purposes"153. It was common ground in this appeal that, absent any statutory modification or definition, the word "charitable" in this context takes on a "technical meaning". It is a meaning that can be traced to the law of trusts and, ultimately, to the preamble to the Statute of Elizabeth154. institutions: Characterising charitable To determine whether a propounded "institution" or its purposes are "charitable", it is necessary in every case for the decision-maker to engage in an act of characterisation. This is not a simple task. First, there is uncertainty as to which factors may be considered when classifying the purpose of a propounded institution. Secondly, the characterisation may, involve a finely balanced determination of the facts, upon which informed decision-makers might disagree. Thirdly, institutions typically have many purposes pursued through a range of activities. Some such purposes and activities may be charitable, whereas others may not. Some may be major whereas others may be minor or incidental. the particular case, Without statutory guidance, characterisation of an institution typically requires the decision-maker to consider a mass of cases and search for the most analogous decisions. In today's society, this must be done in circumstances where the activities of charities, their purposes, objectives and mode of operation are changing. Such changes result partly from new and different social conditions. They partly flow from the attempt of putative "charitable institutions" to carry out new, larger and different objects but within legislation that was substantially enacted in earlier times, traceable to much earlier times, and addressed to charitable activities somewhat different from those now often undertaken by not-for-profit bodies. Care must be observed in citing dicta from the reasons of judges given in earlier times, especially in foreign courts, to decide the correct operation of a local income tax statute such as the 1997 Act. As the joint reasons point out, many of the cases cited in argument by both parties arose in a context involving "charitable purposes" that was different to the way that phrase becomes relevant to the application of the 1997 Act to resolve Word's "charitable institution" claim155. 153 Incorporated Council of Law Reporting (Q) v Federal Commissioner of Taxation (1971) 125 CLR 659 at 666 per Barwick CJ (McTiernan J concurring) and at 671 per Windeyer J; [1971] HCA 44. 154 (1971) 125 CLR 659 at 666-667. 155 See joint reasons at [17]. Kirby Special care must also be taken in applying general judicial observations in both local and overseas cases. Sometimes such observations have been written with a close eye to the particular statutory scheme under consideration. For example, R v The Assessors of the Town of Sunny Brae156 considered s 4(1) of the Rates and Taxes Act 1927 RSNB (Canada), c 190. That provision exempted from taxation: "(d) Every building of a religious organization used exclusively … for religious, philanthropic or educational work of such the organization" (emphasis added). the Canadian The Supreme Court of Canada was closely divided about the application of that statute157. The Court held that a building, which included both a school and a public laundry service conducted by the school, was not entitled to exemption from the relevant rates and taxes. To a very large extent, the respective opinions of all the adverb "exclusively". Self-evidently, it would be somewhat risky to derive from such a case any general proposition of immediate application to the definition of a "charitable institution" in the 1997 Australian Act. With so many context- specific decisions on the availability of exemptions from taxation in this corner of the law, special care must be taken in invoking earlier cases. Often, those cases reflect no more than the judicial response to particular facts; specific legislation; changing social circumstances in which charities operate; and (sometimes) apparent preferences towards some charities rather than others158. turned on judges Both words in the expression "charitable institution" are inherently ambiguous. There is a wealth of judicial authority on this expression and a diverse range of the statutory provisions applied in that authority. It is thus inevitable that considerations of legal principle and policy will operate, even if unconsciously, in decisions about contested claims to charitable status arising in new situations. For that reason, I have attempted to identify some of the considerations that operate in the claim by Word to be a "charitable institution". It has made that claim even though Word does not itself perform any charitable 156 [1952] 2 SCR 76. 157 Rand, Kellock, Estey and Locke JJ; Rinfret CJ, Kerwin and Cartwright JJ dissenting. 158 Thus charities favourable to the professional interests of lawyers have often been well received. For example, charities concerned with the law, including law reporting and women lawyers' interests, have generally enjoyed a favourable response. See, for example, Incorporated Council of Law Reporting (1971) 125 CLR 659 and Victorian Women Lawyers' Association Inc v Commissioner of Taxation [2008] ATC ¶20-035. Kirby activities (except writing cheques); performs instead well-recognised investment and commercial funeral business activities; and only performs its "charitable purposes" through other distinct entities (corporations) which, separately and themselves, might be entitled to classification as "charitable institutions". The entity's business activities: There are several possible reasons why, in this context, Word should be characterised as a business entity liable to income tax in the ordinary way. Its claim for exemption as a "charitable institution" from income tax liability should be rejected. First, there is the need to avoid an abuse of claims to be a "charitable institution" and the potential misuse of such claims for the purposes of tax avoidance. Secondly, there is a legitimate concern of competitors operating in the same market as the actual business operations of Word. By linking the business operations of Word with the "charitable purposes" of Wycliffe or Wycliffe International, Word is allegedly afforded an unfair economic advantage that its competitors in the investment and commercial funeral business market do not enjoy. This concern was raised in the inquiry by the Australian Industry Commission in 1995159 and was also considered by the Australian Charities Definition Inquiry in 2001160. The economic issue so described is not new in Australia. The Parliament debated it when considering the provision of the Bill that later became the section of the 1936 Act that exempted charitable and religious institutions from income tax161. If the economic transfer costs of the exemption for "charitable" and "religious institutions" have divided the Parliament and official inquiries in the past, it is little wonder that courts, including this Court, have also been divided in deciding such cases. One such example is Roman Catholic Archbishop of Melbourne v Lawlor162. That case involved a contested gift by will to establish a Roman Catholic daily newspaper. It resulted in an even division in this Court163. Consequently, the decision of the Full Court of the Supreme Court of Victoria 159 The Industry Commission Report. See above, these reasons at [118]. 160 Australia, Charities Definition Inquiry, Report of the Inquiry into the Definition of Charities and Related Organisations (June 2001) at 230. 161 Clause 23(e). See Australia, Senate, Parliamentary Debates (Hansard), 20 May 1936 at 1893-1894 (Senator Leckie); cf at 1894 (Senator A J McLachlan). 162 (1934) 51 CLR 1; [1934] HCA 14. 163 Gavan Duffy CJ, Evatt and McTiernan JJ held that it was a charitable purpose; Rich, Starke and Dixon JJ contra. Kirby was affirmed164. That case illustrates the opacity of the applicable legal principles and the necessity to provide transparency as to the real reasons for decisions which go beyond formal explanations and legal fictions. To reduce the influence of undisclosed considerations for individual judicial attitudes to particular "charitable institutions" or "charitable purposes", several decisions have adopted the course of analysing the constituting document of the propounded "charitable institution". This is the approach taken by the joint reasons. That document has thus become an influential, if not the dominant, factor in characterising the institution's purpose. It is typically the starting point for legal analysis165. Identifying the entity's real purposes: With respect, there are real dangers in assigning too much importance to the constituting document. This is especially so now that the doctrine of ultra vires in relation to companies has been discarded as an important element in Australian corporations law166. The constituting document can obviously be drafted widely or ambiguously. Its language may generate uncertainty as to the true purposes of the institution propounded as charitable. It may contain multiple purposes but not indicate whether they are all of equal importance or whether some purposes are subsidiary to others. The document may not identify the outer limits of the purposes which the institution may pursue. For these reasons, in my opinion, the real discrimen for the characterisation of an entity propounded as a "charitable institution" is what that entity actually does and what purposes it actually pursues. I take this to be the reason why, in Incorporated Council of Law Reporting (Q) v Federal Commissioner of Taxation167, Barwick CJ said: 164 In re Lawlor; National Trustees, Executors and Agency Co of Australasia Ltd v 165 See eg Royal Australasian College of Surgeons v Federal Commissioner of Taxation (1943) 68 CLR 436 at 443, 447, 448, 450, 451; [1943] HCA 34; Oxford Group [1949] 2 All ER 537 at 539, 540-541; Sunny Brae Case [1952] 2 SCR 76 at 81-82; McGarvie Smith Institute v Campbelltown Municipal Council [1965] NSWR 1641 at 1643-1644; Christian Enterprises Ltd v Commissioner of Land Tax [1968] 2 NSWR 99 at 101-102, 107; Incorporated Council of Law Reporting (1971) 125 CLR 659 at 661-664; Attorney-General v Ross [1986] 1 WLR 252 at 264; [1985] 3 All ER 334 at 344. 166 Corporations Act 2001 (Cth), s 124; cf New South Wales v The Commonwealth (Work Choices Case) (2006) 229 CLR 1 at 98 [122]; [2006] HCA 52. 167 (1971) 125 CLR 659 at 666 (emphasis added). Kirby "If its purposes are charitable, it will be such an institution for the nature of the institution inheres in the purposes it is created to and does pursue." Courts, including this Court, should take the constituting purposes into close account, however they should not be blinded by them. Courts should view the stated purposes in the context of determining what the propounded entity actually does to fulfil the stated purposes. In his reasons in Attorney-General v Ross, Scott J (a judge with much experience in this field) explained why this was the correct approach168: "The question whether under its constitution the union is or is not charitable must, in my view, be answered by reference to the content of its constitution, construed and assessed in the context of the factual background to its formation. This background may serve to elucidate the purpose for which the union was formed. … I must not be taken to be expressing the opinion that the activities of an organisation subsequent to its formation can never be relevant to the question whether the organisation was formed for charitable purposes only. The skill of Chancery draftsmen is well able to produce a constitution of charitable flavour intended to allow the pursuit of aims of a non-charitable or dubiously charitable flavour. In a case where the real purpose for which an organisation was formed is in doubt, it may be legitimate to take into account the nature of the activities which the organisation has since its formation carried on. … The activities of an organisation after its formation may serve to indicate that the power to carry on non-charitable activities was in truth not incidental or supplementary at all but was the main purpose for which the organisation was formed. In such a case the organisation could not be regarded as charitable." Similarly, the reasons of Starke J in Royal Australasian College of Surgeons v Federal Commissioner of Taxation169 may be considered. Although in dissent as to the outcome, Starke J held that it was permissible to examine the actual activities of the College to clarify whether "non-charitable purposes" (such as promoting professional interests) were simply incidental to the accepted "charitable purposes" (of promoting surgical knowledge and practice)170. 168 [1986] 1 WLR 252 at 263; [1985] 3 All ER 334 at 343 (emphasis added). 169 (1943) 68 CLR 436. 170 (1943) 68 CLR 436 at 448. Kirby The actual activities of Word were indisputably conducting investment and commercial funeral business activities for profit. If such activities are available for consideration in characterising Word for the purposes of the 1997 Act, it is obvious to me that Word's own activities were not themselves charitable. What was charitable was the ultimate proposed destination of the profits that Word derived from its investment and commercial funeral business activities. If, then, the focus is upon Word (as distinct from the recipient beneficiaries of its profits after they were accrued by Word) a clear line for the purposes of characterisation may be drawn. The separate corporate "entity", Word, was established to, and did, make profits from investment and commercial funeral business activities. Unless the ultimate destination of the designated profits to other independent corporate entities (including Wycliffe and Wycliffe International) applies retrospectively to colour the characterisation of Word by reason of its subventions, the 1997 Act demands that Word itself be characterised as a business for profit. The ultimate destination of that profit or part of it cannot alter that conclusion. Inevitably, borderline cases have arisen and Australian courts have addressed the question whether corporate entities, propounded as "charitable institutions", were disentitled to that status because some of their activities were capable of characterisation as professional or commercial business activities for profit171. Relevance of unrelatedness: Later Australian decisions have considered the revenue raising business activities of propounded "charitable institutions". This course of authority suggests that courts are reluctant to characterise an institution as "charitable" where it pursues major revenue-raising business activities that are not related to the propounded "charitable purpose". In such a case, the business activity has commonly been classified as non-charitable in character. If it is an important activity of the propounded "charitable institution", the unrelatedness of the revenue-raising activity, for "charitable purposes", will deprive the entity of characterisation as a "charitable institution". For example, selling ice cream or laundry services to raise funds for a religious institution would no doubt be an unrelated activity. By contrast, a Law Reporting body selling law reports would be a related activity172. 171 Instances include Incorporated Council of Law Reporting (1971) 125 CLR 659 at 666, 671-672 and McGarvie Smith [1965] NSWR 1641 at 1646-1647. 172 See, for example, Incorporated Council of Law Reporting (1971) 125 CLR 659. Kirby This was the distinction applied by the majority of the Court of Appeal of New South Wales (Priestley JA with McHugh JA concurring; Lee AJA dissenting) in its influential decision in Glebe Administration Board v Commissioner of Pay-roll Tax173. A similar approach was taken by Hardie Boys J in New Zealand in M K Hunt Foundation Ltd v Commissioner of Inland Revenue174. His Honour explained175: "[I]f this company existed for the … 'specific charitable purposes' already quoted from object A of the memorandum, it would be a charitable body. But the Court's task here is to examine the memorandum and ask whether the real object of the company is charitable or whether its real purpose is that of a speculative subdivider of land, building houses thereon for sale. The fact that the company or its members intend to devote the proceeds of their activities to some worthy cause does not, in my view, assist in deciding what is the real purpose and object of the company." English and Canadian authority: These and similar decisions176 are consistent with the approach taken by the House of Lords in Oxfam v Birmingham City District Council177. There, the appellant charity had the relief of poverty as its main object, a recognised "charitable purpose". It operated gift shops used for sorting and selling donated articles of clothing as well as selling products made in the developing world. All of the profits of such shops were devoted to the charity's purposes. However, their Lordships held that the premises were not being "used for charitable purposes". Lord Cross of Chelsea178 said that their Lordships should: 173 (1987) 10 NSWLR 352 at 365. 174 [1961] NZLR 405. 175 [1961] NZLR 405 at 407. 176 See eg Christian Enterprises Ltd [1968] 2 NSWR 99 at 103-104 per Walsh JA (Asprey JA concurring) and In re Smith, decd; Executor Trustee and Agency Co of South Australia Ltd v Australasian Conference Association Ltd [1954] SASR 151 at 159 per Ligertwood J. 178 [1976] AC 126 at 146 (Lords Simon of Glaisdale, Edmund-Davies and Fraser of Tullybelton agreeing). Kirby "[draw] the line so as to exclude from relief user for the purpose of getting in, raising or earning money for the charity, as opposed to user for purposes directly related to the achievement of the objects of the charity". To secure an exemption from the land taxes in issue in that case, the propounded "charitable institution" had to demonstrate that it was using the property for the actual fulfilment of the identified "charitable purposes". Their Lordships instead held that the shops are used for an activity which is not inherently charitable179. If a similar criterion is applied in the present appeal, the investment and commercial funeral business activities of Word were not, by any stretch of the imagination, "inherently charitable". They did not relate to Word's propounded "charitable purposes", namely the propagation of religion. They were distinct and separate. A fair reading of the judicial authority relied on by the Commissioner sustains his submission. The reasons of the majority of this Court in this appeal represent a heterodox extension of the ambit of the previous understanding of the requirements for a "charity" to constitute a "charitable institution" that is entitled to exemption from income tax. Allowing fully for the differences in the applicable language of the respective legislation, several Canadian decisions have adopted an approach to the central issue presented in this appeal similar to that in the above Australian, New Zealand and United Kingdom cases. For example, the decision of the Supreme Court of New Brunswick in Kennebecasis Valley Recreational Centre Inc v Minister of Municipal Affairs of New Brunswick180. In that case, five communities incorporated a property to establish a local recreational centre and it was hired out on commercial terms for events to derive profits. The Court there held that it was not used solely for charitable activities as required by the statute181. The Court drew a distinction between exempted charitable activities and those of "a company which operates a business on a regular basis and in an efficient business-like manner"182. If the same, or a similar, criterion were applied to Word, the actual objectives that it pursued, in practice, were the running of a commercial enterprise for profit. It did so by way of investment and 179 But see also [1976] AC 126 at 139 where Lord Cross of Chelsea held that premises would be exempt from land tax if: "not being used for the actual relief of poverty … if … the use which it makes of them is 'wholly ancillary to' or 'directly facilitates' the carrying out of its charitable object … [such as] the head office of Oxfam." 180 (1975) 61 DLR (3d) 364. 181 (1975) 61 DLR (3d) 364 at 372 per Bugold JA (Ryan JA concurring). 182 (1975) 61 DLR (3d) 364 at 373 per Bugold JA (Ryan JA concurring). Kirby commercial funeral business activities, apparently conducted in a business-like manner. Several decisions of the Supreme Court of Canada take a similarly strict view towards claims for exemption from general legal obligations otherwise applicable on the propounded ground of the existence of charitable objects or purposes183. In one such decision, Gonthier J (although in dissent) differentiated between the identified primary, collateral or independent purposes and merely incidental or ancillary purposes of a propounded "charitable institution". His Lordship said184: "To qualify as charitable, the purposes of an organization or trust must be exclusively charitable. … The exclusivity requirement is also reflected in the [Tax Act] itself. … It has long been accepted that the pursuit of purposes which, though not charitable in themselves, are merely ancillary or incidental to the fulfilment of the primary, charitable, purposes of an organization will not cause the organization to run afoul of the exclusivity requirement. At a certain point, of course, a purpose may grow to assume a collateral rather than incidental nature. If so, it will no longer be a means to the fulfilment of the organization's primary purposes, but will have become an end in itself." "In the law of charity, the courts' primary concern is to determine whether the purposes being pursued are charitable. It is these purposes which are essential, not the activities engaged in, although the activities must, of course, bear a coherent relationship to the purposes sought to be achieved." Conclusion: proper characterisation: From the foregoing authorities, which on the general approach are largely consistent, it follows that the propounded charitable institution's purposes, as stated in its constituting document, will only take a decision-maker so far. This is at least the case when 183 Composers, Authors and Publishers Association of Canada, Ltd v Kiwanis Club of West Toronto [1953] 2 SCR 111 at 115; Vancouver Society of Immigrant and Visible Minority Women v Minister of National Revenue [1999] 1 SCR 10 at 111 184 Vancouver Society [1999] 1 SCR 10 at 44-45. 185 [1999] 1 SCR 10 at 52 (emphasis in original). Kirby the decision-maker is faced with the obligation of characterisation as required by legislation such as Div 50 of Pt 2-15 of the 1997 Act. The decision-maker is obliged to decide objectively whether a propounded entity is pursuing business or charitable purposes. Given that the only cases likely to reach the courts (especially final courts) are those in which there is evidence both ways, it is necessary to draw the resulting line. Are the non- charitable purposes of the "charitable institution" merely "incidental" or "ancillary" to the primary "charitable purpose"? If so, the institution can be characterised as "charitable". Or are there distinctive factual features, significant to and related to any actual charitable performance, that make the business activities distinguishable from the "charitable purposes" so as to deny the entity the classification of "charitable institution"? The business activity will more readily be characterised as "ancillary" or "incidental" to the "charitable purpose" that is propounded by the "charitable institution" where it is directed to the charitable activity that first existed186. The revenue-raising activity, however, the entity of characterisation as a "charitable institution" where it is an unrelated activity that pursues a separate and independent purpose (such as running an ice cream parlour or laundry to raise funds for a religious institution). to deprive likely On the authorities, unrelated revenue-raising activities are more likely to evidence two distinct purposes: a "charitable purpose" (to raise funds for the charity) and a commercial purpose (to conduct a business at a profit). The common law has long insisted that, to be a "charitable institution", the purpose of the institution must be exclusively charitable (with non-charitable activities no more than ancillary). Thus, dual characteristics will be sufficient to deprive the institution of classification as a "charitable institution". Is that the situation in the case of Word? Word is not a charitable institution: Applying the foregoing criteria rather than a purely formal analysis by reference only to the purposes which a legal draftsman stated in Word's constituting document, Word's argument that it was a "charitable institution" ought to have been dismissed. Application of established decisional authority observed in this country, and in many others of the same legal tradition, required its rejection. This conclusion provides a separate and additional ground for upholding the Commissioner's appeal. I have thus found for the Commissioner on the substance of each of the issues presented in this appeal. It is unnecessary for me to decide all of the other arguments that the Commissioner presented to support 186 As it was in McGarvie Smith [1965] NSWR 1641 at 1647. Kirby his submission that the Federal Court departed from established authority in elucidating the character of a "charitable institution". That Court erred in misapplying the "Special condition" of s 50-50(a) of the 1997 Act, thereby allowing Word to fall within the exemption from income tax. It also erred in finding that Word was a "charitable institution", despite the substantial business activities of Word that were unrelated to its "charitable purposes", except as a means of raising income. Orders The appeal should be allowed. The judgment of the Full Court of the Federal Court of Australia should be set aside. In its place, this Court should order that the appeal from the judgment of the primary judge be allowed; the cross-appeal to the Full Court be dismissed; and the decision of the Administrative Appeals Tribunal made on 27 September 2005 be set aside. In place of the AAT's decision, the Commissioner's objection decision should be confirmed. Special leave was granted to the Commissioner on the basis that he would not seek to disturb any costs orders made in the Federal Court and would pay Word's costs of the appeal to this Court. The only costs order in respect of the proceedings should therefore be that the Commissioner pay Word's costs of the appeal.

HIGH COURT OF AUSTRALIA Matter No B87/2005 APPELLANT AND THE QUEEN Matter No B88/2005 RESPONDENT GWENDOLINE CECILY DEEMAL-HALL APPELLANT AND THE QUEEN Matter No B89/2005 RESPONDENT APPELLANT AND THE QUEEN RESPONDENT Deemal-Hall v The Queen McIvor v The Queen [2006] HCA 34 22 June 2006 B87/2005, B88/2005 & B89/2005 ORDER In each matter, the appeal is dismissed. On appeal from the Supreme Court of Queensland Representation A J Rafter SC for the appellant in B87/2005 (instructed by Legal Aid Queensland) P J Callaghan SC with A W Moynihan for the appellant in B88/2005 (instructed by Legal Aid Queensland) M J Byrne QC for the appellant in B89/2005 (instructed by Legal Aid Queensland) M J Copley for the respondent in all matters (instructed by Director of Public Prosecutions (Queensland)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Deemal-Hall v The Queen McIvor v The Queen Criminal Law – Common intention to prosecute unlawful purpose – Aiding the commission of an offence – Counselling the commission of an offence – Assault causing death – Appellants tried together and convicted of murder – Where Crown case relied on ss 7, 8 and 9 of the Criminal Code (Q) – Jury directed by trial judge that for the purpose of ss 8 and 9 of the Criminal Code (Q) "a probable consequence" was one which was "a real possibility or a substantial chance or a real chance" – Meaning of "a probable consequence" – Whether "probable" connotes something more than "possibility" or "real possibility" or "real chance" – Whether jury was misdirected. Criminal Law – Application of the proviso under s 668E(1A) of the Criminal Code (Q) – Whether "substantial miscarriage of justice" has actually occurred – Whether trial fundamentally flawed – Relevance of unknown mode of jury reasoning – Relevance of the fact that the misdirection concerned the elements of the offences charged. Appeal – Court of criminal appeal – Proviso not considered by court of criminal appeal – Whether High Court should consider proviso in the circumstances – Role of court of criminal appeal – Role of High Court – Limitations on High Court considering the proviso without scrutiny of the record of evidence by court of criminal appeal – Defects of a trial on the record. Words and phrases – "a probable consequence", "substantial miscarriage of justice". Criminal Code (Q), ss 8, 9, 668E(1A). GLEESON CJ, GUMMOW, HEYDON AND CRENNAN JJ. These three appeals were argued together. The appellant in the first appeal is Howard Rodney Darkan ("the first appellant"), in the second Gwendoline Cecily Deemal- Hall ("the second appellant") and in the third Marlow Phillip Andrew McIvor ("the third appellant"). The appellants were jointly tried at Cairns before a jury in the Supreme Court of Queensland (Jones J). They were charged with murdering Kalman John Toth ("the deceased") on 13 January 2003. They were each convicted and sentenced to life imprisonment. Their appeals to the Court of Appeal against conviction were dismissed1. The appellants appeal against those orders on a single ground relating to the directions which the trial judge gave the jury on the meaning of the expression "a probable consequence" as used in ss 8 and 9 of the Criminal Code (Q) ("the Code"). In the case of all three appellants, the prosecution relied on s 8. In the case of the second appellant, it relied also on s 9. The appellants contend that the trial judge erred in telling the jury that "a probable consequence" was one which was "a real possibility or a substantial cause or a real chance". That contention is sound. However, each appeal should be dismissed because the proviso should be applied – that is, because "no substantial miscarriage of justice has actually occurred" within the meaning of those words in s 668E(1A) of the Code. The factual circumstances The appellants did not give evidence at the trial. Each appellant was interviewed by police officers, but the answers of any particular appellant were only admissible as against that appellant, and the admissions made by the second appellant were far less extensive than those made by the other two. For that reason it is necessary to be careful in assessing the strength of the case against each appellant in relation to s 668E(1A). However, for present purposes, the primary evidence admissible against all the appellants, largely given by a witness named Bowen, revealed the prosecution case to be as follows. The second appellant had been the de facto wife of the deceased. She had a grievance against him and wanted to cause him some harm. The deceased was aged 58, but he was a large man, and the second appellant saw it as necessary to recruit the services of no fewer than three men to cause him harm – the first appellant, aged 30, the third appellant, aged 23, and Bowen, aged 22. Indeed, she attempted to secure as well the services of a fourth man named Michael James 1 R v Deemal-Hall, Darkan & McIvor [2005] QCA 206. Crennan Cobus. The evidence about the nature of the harm she requested will be examined below. For their services, each of the three men recruited was to receive $50, and more the following week. The second appellant took the first appellant, the third appellant and Bowen in a van to Bicentennial Lakes Park, Mareeba, on the evening of 13 January 2003. She dropped them there and later returned with the deceased. The deceased got out of the van, but later went back into it and locked it. The second appellant persuaded him to let her enter it, and to drive it to a shed area. They then alighted and sat down with the first appellant, the third appellant and Bowen. The first appellant began to taunt the deceased and punched him in the face. The deceased stood up and began defending himself, and a fist fight broke out. It continued for some time. The third appellant then hit the deceased on the back of the neck with a pickaxe handle. The deceased fell to the ground and covered his face up as the first appellant and the third appellant, who (at least according to Bowen) were wearing steel-capped boots, began kicking him. They continued to kick him for a good while. Watched by the second appellant, the first appellant then took the pickaxe handle from the third appellant, and hit the deceased for a couple of minutes around the ankles and knees before making his way up the body and hitting the deceased in the ribs. The deceased was crying for help. Bowen took the pickaxe handle from the first appellant and gave it to the third appellant. He told him to get rid of it and not to give it back to the first appellant. However, the first appellant took the pickaxe handle away from the third appellant and began hitting the deceased in the head as if "he really meant it this time". The appellants and Bowen then panicked and left the scene. Before he left, Bowen examined the deceased's face and found him to be "messed up pretty bad". The deceased asked Bowen to get help, and Bowen told the second appellant of this request before she dropped him at his aunt's house and gave him his $50. The deceased's body was discovered at 6am the following day. A pathologist who conducted a post mortem examination found that, apart from severe bruising of many parts of the deceased's body, there was fracturing of the upper and lower jaw and of many facial bones, that there were many facial lacerations, and that the cause of death was aspiration of blood due to severe facial trauma. The pathologist thought that the injuries could have been caused by the pickaxe handle, if severe force were used. What had the second appellant said to trigger the death of the deceased in this way? On Bowen's account in chief of a conversation between himself, the first appellant and the second appellant, the first appellant said that the second Crennan appellant wanted someone to "fix him up" (ie the deceased), and the second appellant said she would pay whoever would "fix it up". Bowen also said in chief that while the second appellant was driving the three men in the van to the park, she said she "just wanted someone to get into him". He repeated that evidence in cross-examination. Counsel for the second appellant cross-examined Bowen as follows: "Mr Bowen, whatever the exact words being used in the conversation were, whatever they might have been, is it the case that what was discussed was a plan to give this fellow a touch-up, is that correct?-- Yes. And nothing more than a touch-up?-- Yes." Bowen repeated that evidence twice. He also said that there had been no discussion of a plan to kick the deceased or use a weapon on him. The legislation Section 291 of the Code provides that it is unlawful to kill any person unless the killing is authorised or justified or excused by law. Section 293 provides that any person who causes the death of another, directly or indirectly, by any means whatever, is deemed to have killed that other person. Section 300 provides that any person who unlawfully kills another is guilty of murder or manslaughter according to the circumstances of the case. The following provisions of the definition of "murder" in s 302 are relevant. "(1) Except as hereinafter set forth, a person who unlawfully kills another under any of the following circumstances, that is to say – if the offender intends to cause the death of the person killed or that of some other person or if the offender intends to do to the person killed or to some other person some grievous bodily harm; if death is caused by means of an act done in the prosecution of an unlawful purpose, which act is of such a nature as to be likely to endanger human life; is guilty of murder." Chapter 2 of the Code is entitled "Parties to offences". It comprises ss 7- Crennan The heading to s 7 is "Principal offenders". Section 7(1) provides in part: "When an offence is committed, each of the following persons is deemed to have taken part in committing the offence and to be guilty of the offence, and may be charged with actually committing it, that is to say – every person who actually does the act or makes the omission which constitutes the offence; every person who aids another person in committing the offence; any person who counsels or procures any other person to commit the offence." The heading to s 8 is "Offences committed in prosecution of common purpose". It provides: "When 2 or more persons form a common intention to prosecute an unlawful purpose in conjunction with one another, and in the prosecution of such purpose an offence is committed of such a nature that its commission was a probable consequence of the prosecution of such purpose, each of them is deemed to have committed the offence." The heading to s 9 is "Mode of execution immaterial". Section 9(1) provides: "When a person counsels another to commit an offence, and an offence is actually committed after such counsel by the person to whom it is given, it is immaterial whether the offence actually committed is the same as that counselled or a different one, or whether the offence is committed in the way counselled, or in a different way, provided in either case that the facts constituting the offence actually committed are a probable consequence of carrying out the counsel." The heading to s 10A is "Interpretation of ch 2". Section 10A(2) provides: "Under section 8, a person's criminal responsibility extends to any offence that, on the evidence admissible against him or her, is a probable consequence of the prosecution of a common intention to prosecute an unlawful purpose, regardless of what offence is proved against any other party to the common intention." Crennan The prosecution case as put to the jury As recorded in the trial judge's summing up, the prosecution's case was that either the first appellant or the third appellant or both of them delivered the blows that caused the death of the deceased. It put its case against the first appellant and the third appellant in three ways. The first was that each killed the deceased intending to do him grievous bodily harm: s 302(1)(a) and s 7(1)(a). The second was that each aided the other, or did or omitted to do an act for the purpose of enabling or aiding the other, to kill the deceased knowing that the other intended to do the deceased grievous bodily harm: s 302(1)(a) and s 7(1)(c). The third – and this case was put against the second appellant as well – depended on s 8 of the Code, and will be described as the s 8 allegation. The s 8 allegation was that the appellants formed a common intention to prosecute an unlawful purpose; that the death was caused by an act done in the prosecution of that purpose which was of such a nature as to be likely to endanger human life; and that the act causing death was a probable consequence of the prosecution of the unlawful purpose: s 302(1)(b) and s 8. As recorded in the trial judge's summing up, the prosecution put its case against the second appellant in a manner additional to the s 8 allegation. It will be described below as the s 9 allegation. It was that she counselled or procured the first appellant and the third appellant to assault the deceased; that they engaged in conduct – administering blows to the deceased with intent to do him grievous bodily harm – which constituted murder as defined in s 302(1)(a); and that the delivery of blows with that intent was a probable consequence of the counselling or procuring: s 7(1)(d) and s 9. The s 8 allegation, made against all three appellants, in part depended on the meaning of "a probable consequence" in s 8. The s 9 allegation, made against the second appellant, depended in part on the meaning of "a probable consequence" in s 9. The jury was given copies of ss 7, 8 and 9. The passage complained of The only complaint which the appellants made to this Court about the summing up concerns a single sentence in a summing up, the transcript of which ran to over 40 pages. The sentence appeared after the trial judge had explained the way in which the prosecution put its s 9 allegation against the second appellant, and just before the trial judge explained the way the prosecution put its s 8 allegation against all three appellants. The sentence concerned the meaning of the expression "a probable consequence" as it appears in s 9. The sentence was: Crennan "Now when I speak of probable consequences, it means that it's a real possibility or a substantial cause or a real chance that that event would happen." Three preliminary points may be made about this direction. First, even if the trial judge actually said "substantial cause" rather than "substantial chance" while intending to say "substantial chance", which is open to question, no appellant submitted that anything turned on that slip. It is accordingly safe to decide the appeals on the assumption that instead of "cause" the trial judge said "chance". Secondly, although this direction was given in relation to s 9, and thus only in relation to the second appellant, in argument before this Court the prosecution did not deny that the jury would or could have taken the direction to apply also to s 8, and hence to the case against all three appellants. Thirdly, none of the counsel appearing for the appellants at the trial asked that the direction be corrected and given in different terms. There would have been no point in asking for this, since the trial judge was bound by the decision of the Queensland Court of Appeal in R v Hind and Harwood that the expression "a probable consequence" in s 8 was satisfied if the consequence was a real or substantial possibility or chance2. The Queensland Court of Appeal in the present case held that R v Hind and Harwood reflected a "settled position" on the interpretation of s 83. That proposition is reflected in the Bench Book ordinarily used in Queensland as the basis for formulating directions4 and it is assumed by the profession in Queensland to be correct5. However, the direction was not 2 R v Hind and Harwood (1995) 80 A Crim R 105 at 116-117 per Fitzgerald P and 141-142 per Pincus JA. In fact that decision was a case in which the issue turned not on jury direction but on whether the verdict was reasonable. On a strict view it might be said that the case is not an authority on jury direction. But underlying both the issue of jury direction and the issue of reasonableness of verdict is a common question – what does "a probable consequence" mean? 3 R v Deemal-Hall, Darkan & McIvor [2005] QCA 206 at [55] per Keane JA, Williams JA and Muir J concurring. 4 At 71.6 and 71.11. 5 For example, R v Chan [2001] 2 Qd R 662 at 663 [3]; R v Jeffrey [2003] 2 Qd R Crennan mandatory, and no counsel asked either that it not be given or that it be withdrawn. Difficulties in the word "probable" There are two preliminary points to be made about the use of the word "probable" in expounding and applying rules of law. The first is that the application of legal tests that turn on questions of probability will vary with the context in which the question is asked. That is, "probability" can denote a variety of degrees of confidence. Probabilities can be of different degrees of strength. This has been recognised in relation to the construction of criminal statutes6. It has been recognised outside that field as well. For example, Kitto, Taylor, Menzies and Owen JJ said in Beecham Group Ltd v Bristol Laboratories Pty Ltd7 that the first question to be addressed in dealing with applications for interlocutory injunctions in patent cases is: "whether the plaintiff has made out a prima facie case, in the sense that if the evidence remains as it is there is a probability that at the trial of the action the plaintiff will be held entitled to relief ... How strong the probability needs to be depends, no doubt, upon the nature of the rights he asserts and the practical consequences likely to flow from the order he seeks. Thus, if merely pecuniary interests are involved, 'some' probability of success is enough". They quoted the words of Roper CJ in Eq in Linfield Linen Pty Ltd v Nejain8: "[T]his being an application for an interlocutory injunction I look at the facts simply to ascertain whether the plaintiff has established a fair prima- facie case and a fair probability of being able to succeed in that case at the hearing." 6 Boughey v The Queen (1986) 161 CLR 10 at 20 per Mason, Wilson and Deane JJ. (1968) 118 CLR 618 at 622. The force of what was said in this case is not diminished by the fact that the test now preferred in relation to the grant of interlocutory injunctions is different. (1951) 51 SR (NSW) 280 at 281. Crennan It is also relevant to note an observation made by Kitto J in the course of argument in the Beecham case9: "When it is said that the plaintiff must show a probability of success, that does not mean that he must show that it is more probable than not that he will succeed. It is enough that he show a sufficient likelihood of success to justify in the circumstances the preservation of property." The second preliminary point is that whatever precise meaning the word "probable" bears in a particular context, it is usually used to establish a contrast to what is "possible". Thus the Concise Oxford English Dictionary defines "possible" as that which "may exist or happen, but that is not certain or probable"10. In Overseas Tankship (UK) Ltd v The Miller Steamship Co Pty11 Lord Reid said of the word "probable" as used in judgments: "It is used with various shades of meaning. Sometimes it appears to mean more probable than not, sometimes it appears to include events likely but not very likely to occur, sometimes it has a still wider meaning and refers to events the chance of which is anything more than a bare possibility". The New Zealand Court of Appeal said that those shades of meaning could be found in ordinary popular speech as well as in judgments12: "The two most common meanings are 'more probable than not' and what Lord Reid described as 'likely but not very likely'. We prefer, for present purposes, to say that a probable event, in this second sense of the word, means an event that could well happen. These two most common meanings are both descriptive of a stronger prospect of the occurrence of an event than is conveyed by the word 'possible'. We see no justification for reading 'probable consequence' in s 66(2)13 as 'possible consequence'. (1968) 118 CLR 618 at 620. 10 11th ed (2004). 11 [1967] 1 AC 617 at 634-635. 12 R v Gush [1980] 2 NZLR 92 at 94 per Richmond P, Richardson and O'Regan JJ (emphasis in original). 13 Crimes Act 1961 (NZ), s 66(2), the equivalent to s 8 of the Code. Crennan On the other hand we do not think that it can be said that 'more probable than not' is clearly the primary meaning of the word. It is of course used a great deal in that sense, but so much depends upon the context in which and the purpose for which it is used in any particular case. Our inquiry must therefore be to ascertain the meaning of 'probable' which will best ensure the attainment of the objects of s 66(2)." In this case the possible meanings of "probable" which were referred to were, in descending order of likelihood: (a) more probable than not; a probability of less than 50/50, but more than a substantial or real and not remote possibility; a substantial or real and not remote possibility; a possibility which is "bare" in the sense that it is less than a substantial or real and not remote possibility. The parties agreed that (a) and (d) were incorrect. It was also agreed that (c) was wrong. The appellants contended that (b) was correct. The respondent contended that if (b) was correct, the trial judge's direction did not diverge from Before the arguments advanced by the appellants are considered, it is desirable to examine the history of ss 8 and 9 of the Code; the reasoning advanced in the Queensland authorities in support of the direction impugned in this case; the points of construction of ss 8 and 9 on which the parties are agreed; and why the parties are correct in their agreement. History Sections 8 and 9 deal with different forms of criminal responsibility as an accessory before the fact. The origin of the expression "a probable consequence" in those sections can be traced to Sir Matthew Hale, who said14: "[I]f A. command B. to beat C. and B. beats C. so that he dies, A. is accessary, because it may be a probable consequence of his beating ... 14 Hale, Historia Placitorum Coronae, (1736), vol 1 at 617 (emphasis added). Crennan [T]he like it is if he command B. to rob him, and in robbing him B. kills him, A. is accessary to the murder." The third edition (1792) of Foster's Crown Law, after referring to Hale, dealt as follows with "cases where a person supposed to commit a felony at the instigation of another hath gone beyond the terms of such instigation, or hath, in the execution, varied from them"15. It said16: "If the principal totally and substantially varieth, if being solicited to commit a felony of one kind he wilfully and knowingly committeth a felony of another, he will stand single in that offence, and the person soliciting will not be involved in his guilt. For on his part it was no more than a fruitless ineffectual temptation. The fact cannot with any propriety be said to have been committed under the influence of that temptation." It continued17: "But if the principal in substance complieth with the temptation, varying only in circumstance of time or place, or in the manner of execution, in these cases the person soliciting to the offence will, if absent, be an accessary before the fact, if present a principal." "So where the principal goeth beyond the terms of the solicitation, if in the event the felony committed was a probable consequence of what 15 Foster, A Report of Some Proceedings on the Commission for the Trial of the Rebels in the Year 1746, in the County of Surry; and of Other Crown Cases, 3rd ed 16 Foster, A Report of Some Proceedings on the Commission for the Trial of the Rebels in the Year 1746, in the County of Surry; and of Other Crown Cases, 3rd ed (1792) at 369 (emphasis in original). 17 Foster, A Report of Some Proceedings on the Commission for the Trial of the Rebels in the Year 1746, in the County of Surry; and of Other Crown Cases, 3rd ed 18 Foster, A Report of Some Proceedings on the Commission for the Trial of the Rebels in the Year 1746, in the County of Surry; and of Other Crown Cases, 3rd ed (1792) at 370 (emphasis in original). Crennan was ordered or advised, the person giving such orders or advice will be an accessary to that felony." Dixon and Evatt JJ quoted this passage in Brennan v The King19. The expression "a probable consequence" is to be noted. The work then gave three examples20: "A., upon some affront given by B., ordereth his servant to way-lay him and give him a sound beating; the servant doth so, and B. dieth of this beating. A. is accessary to this murder. A. adviseth B. to rob C., he doth rob him, and in so doing, either upon resistance made, or to conceal the fact, or upon any other motive operating at the time of the robbery, killeth him. A. is accessary to this murder. Or A. soliciteth B. to burn the house of C.; he doth it; and the flames taking hold of the house of D. that likewise is burnt. A. is accessary to the burning of this latter house." The work concluded21: "These cases are all governed by one and the same principle. The advice, solicitation, or orders in substance were pursued, and were extremely flagitious on the part of A. The events, though possibly falling out beyond his original intention, were in the ordinary course of things the probable consequences of what B. did under the influence, and at the instigation of A. And therefore, in the justice of the law, he is answerable for them." 19 (1936) 55 CLR 253 at 263. Dixon and Evatt JJ cited the passage as being from the 1809 edition. Foster's Crown Law is often referred to in the 1809 edition. In fact there was no 1809 edition. There was, rather, in that year a reprint of the 3rd edition of 1792. 20 Foster, A Report of Some Proceedings on the Commission for the Trial of the Rebels in the Year 1746, in the County of Surry; and of Other Crown Cases, 3rd ed 21 Foster, A Report of Some Proceedings on the Commission for the Trial of the Rebels in the Year 1746, in the County of Surry; and of Other Crown Cases, 3rd ed (1792) at 370 (emphasis in original). Crennan Stephen J said in Johns v The Queen that the examples given reveal that the author cannot have meant by "a probable consequence" a consequence that was more probable than not22. In 1877, Sir James Fitzjames Stephen published A Digest of the Criminal Law (Crimes and Punishments). It contained no clear precursor to s 8 of the Code, but Art 41 was a precursor to s 923. The title was "Where crime committed is probable consequence of crime suggested." Despite the word "probable" in that title, Art 41 provided24: "If a person instigates another to commit a crime, and the person so instigated commits a crime different from the one which he was instigated to commit, but likely to be caused by such instigation, the instigator is an accessory before the fact." In Johns v The Queen, Stephen J suggested that "likely" did not here appear to mean "more probable to happen than not", since among the illustrations given by Sir James Fitzjames Stephen was the second example given in Foster's Crown Law25. Sir James Fitzjames Stephen then suggested to the Lord Chancellor (Lord Cairns) and the Attorney-General (Sir John Holker) that the Digest could be made into a draft Penal Code. They authorised him to prepare a draft Penal 22 (1980) 143 CLR 108 at 120. 23 cf Johns v The Queen (1980) 143 CLR 108 at 128, where Mason, Murphy and Wilson JJ suggested that Art 41 was a precursor to s 8, and Art 38 to s 7. Article 38 bore the title "Common purpose" and provided: "When several persons taken part in the execution of a common criminal purpose, each is a principal in the second degree, in respect of every crime committed by any one of them in the execution of that purpose. If any of the offenders commits a crime foreign to the common criminal purpose, the others are neither principals in the second degree, nor accessories unless they actually instigate or assist in its commission." 24 Stephen, A Digest of the Criminal Law (Crimes and Punishments), (1877) at 25-26. 25 (1980) 143 CLR 108 at 120. Crennan Code, and this he did. Sir John Holker introduced it into Parliament as the Criminal Code Indictable Offences Bill 1878. According to Stephen26: "[T]he bill was favourably received, but Parliament had not time to attend to it. A commission, however, was issued to Lord Blackburn, Mr Justice Barry, Lord-Justice Lush, and myself, to inquire into and consider and report upon the Draft Code. It was accordingly considered by us for about five months, namely from November, 1878, to May, 1879. We sat daily during nearly the whole of that time, and discussed every line and nearly every word of every section. The Draft Code which was appended to the Report speaks for itself. It differs slightly from the Draft Code of 1878. The particulars of the differences are stated in the Report prefixed to the Draft Code of 1879." The relevant provisions of Stephen's draft Penal Code were ss 71 and 72, which were part of Ch IV. They corresponded with ss 71 and 72 in Pt IV of the Draft Code of 1879 which was appended to the Report. The Report said of Ch IV and Pt IV: "Each effects a change, not so much in the substance as in the language of the existing law."27 The concluding words of s 71 of the Draft Code of 1879 were: "If several persons form a common intention to prosecute any unlawful purpose, and to assist each other therein, each of them is a party to every offence committed by any one of them in the prosecution of such common purpose, the commission of which offence was or ought to have been known to be a probable consequence of the prosecution of such common purpose." The concluding words of s 72 were: "Every one who counsels or procures another to be a party to an offence is a party to every offence which that other commits in consequence of such counselling or procuring, and which the person counselling or procuring knew or ought to have known to be likely to be committed in consequence of such counselling or procuring." 26 Stephen, A History of the Criminal Law of England, (1883), vol I at vi. 27 United Kingdom, Report of the Royal Commission Appointed to Consider the Law Relating to Indictable Offences, (1879) [C 2345] at 19. Crennan The marginal note to s 72 stated: "This is believed to express the existing law. See Foster, Chapter III." As noted above, Foster's Crown Law did not describe the offence committed as being one which "the person counselling or procuring knew or ought to have known to be likely to be committed in consequence of such counselling or procuring". Instead it described the relevant events as being "in the ordinary course of things the probable consequences of what B. did under the influence, and at the instigation of A.". The Draft Code of 1879 was put to Parliament as the Criminal Code Bill in 1880. Section 71 of the Draft Code of 1879 became s 72 of the Criminal Code Bill 1880 and s 72 of the Draft Code of 1879 became s 73 of the Criminal Code Bill 1880. The Criminal Code Bill 1880 was not enacted, in part because the government changed in 1880, and in part because of Cockburn CJ's criticism of it28. However, the Bill aroused interest in Canada, New Zealand and Australia. This led to legislation in Canada in 1892. It led to legislation in New Zealand in 1893. It led to the preparation in 1897 by Sir Samuel Griffith for the Government of Queensland of a Draft Code of Criminal Law. That Draft Code was enacted in Queensland in 1899 and in Western Australia in 1902. A version of Sir Samuel's Draft Code was enacted in Tasmania in 1924 and in the Northern Territory in 1983. Section 10 of Sir Samuel Griffith's Draft Code was identical to s 8 of the present Code (and to s 8(1) of the Criminal Code (WA) and s 4 of the Criminal Code (Tas)), and s 11 was identical to s 9(1) of the present Code (and to s 9 of the Criminal Code (WA) and s 5 of the Criminal Code (Tas) (substantially))29. Sir Samuel attached the following marginal note to s 10 of his Draft Code: "Common Law. Bill of 1880, s 72." This type of note would normally indicate that he viewed the provision as preserving the common law. Section 10 of Sir Samuel's Draft Code did not correspond with the common law as it is now understood to be, namely that the principal offender's crime must be foreseen by the accessory "as a possible incident of the common unlawful enterprise"30. It 28 Radzinowicz, Sir James Fitzjames Stephen 1829-1894 and his Contribution to the Development of Criminal Law, (1957) at 20-21. 29 The Criminal Code (NT) took a different course: s 8(1) and s 9 each render the alleged accessory liable unless the alleged accessory proves that he or she did not foresee the commission of the offence as "a possible consequence" of prosecuting the unlawful purpose or giving the counsel respectively. 30 Chan Wing-Siu v The Queen [1985] AC 168 at 175. Crennan did, however, bear some resemblance to the statement of the common law to be found in the 1896 edition of Russell31: "It is submitted that the true rule of law is, that where several persons engage in the pursuit of a common unlawful object, and one of them does an act which the others ought to have known was not improbable to happen in the course of pursuing such common unlawful object, all are guilty." Nor did s 10 of Sir Samuel's Draft Code correspond with s 72 of the Criminal Code Bill of 1880, since it omitted the words "or ought to have been known to be". In this respect it differed from s 61 of the Criminal Code 1892 (Can), which contained a provision identical to s 72; the corresponding but different provision now in force is s 21(2) of the Criminal Code (Can) (using the phrase "... knew or ought to have known that the commission of the offence would be a probable consequence of carrying out the common purpose"). In this respect s 10 of Sir Samuel's Draft Code also differs from the New Zealand legislation enacted successively as the Criminal Code Act 1893, s 73 and the Crimes Act 1908, s 90(2) (using the phrase "... was or ought to have been known to be a probable consequence"); the legislation is now in force in a different form as s 66(2) of the Crimes Act 1961 (using the phrase "... known to be a probable consequence of the prosecution of the common purpose"). Sir Samuel Griffith also placed the following marginal note to s 11 of his Draft Code: "Common Law. Bill of 1880, s 73." It is true that s 11 did correspond substantially with the common law as reflected in Foster's Crown Law and, for example, in Halsbury's Laws of England, published in 190932. It is not, however, true that s 11 corresponded exactly with s 73 of the Criminal Code Bill of 1880: it adopted a "probable consequence" test in lieu of the words "knew or ought to have known to be likely to be committed". 31 Russell, A Treatise on Crimes and Misdemeanors, 6th ed (1896), vol I at 169 (emphasis added). See also McAuliffe v The Queen (1995) 183 CLR 108 at 114- 116 per Brennan CJ, Deane, Dawson, Toohey and Gummow JJ. 32 Halsbury's Laws of England, 1st ed, vol IX, "Criminal Law and Procedure", par 532, at 255: "Where the principal goes beyond the terms of the instigation, yet if the advice or order of the instigator is substantially followed or obeyed, and the felony committed was a probable consequence of what was ordered or advised, the person giving the order or advice is an accessory to that felony." Crennan The history thus briefly set out does not offer any decisive reason for selecting one rather than another construction for "a probable consequence" in ss 8 and 9 of the Code. But it does serve as a reminder of how great the difference is between s 8 of the Code and the common law as now understood, for the common law stress on the need for "a crime foreseen as a possible incident of the common unlawful enterprise"33 is quite different from Sir Samuel Griffith's requirement of a probable consequence. The history illustrates how Sir Samuel Griffith decided to adopt the entirely objective approach in Foster's Crown Law for the problem addressed by s 9 and extend it to the problem addressed by s 8. And the history also suggests that the failure of Sir Samuel's Draft Code to take up as an element in any test the mental state of the accused, or what the accused ought to have known, meant that very wide liability would potentially rest on accused persons if "a probable consequence" were given a meaning extending to any possibility which might be described as real or substantial. The language of the Code generally The word "probable" was only used in the original Code in s 8 and s 9(1). It is now also used in s 10A(2), a provision introduced in 1997. Apart from those three instances, it is used in only one place in the Code. That is s 415(1)(a), dealing with the crime of extortion, where the expression "without reasonable or probable cause" is employed. Like s 10A(2), s 415 did not appear in the original Code. The word "likely" is used in many parts of the Code – some appearing in the original Code, some added since. But neither s 415 nor the sections using the word "likely" cast any light on the meaning of "a probable consequence" in s 8 or Authorities relied on by Fitzgerald P and Pincus JA The only prior authority of this Court on the meaning of "a probable consequence" in s 8 or its equivalents is Brennan v The King34, a decision on s 8 of the Criminal Code (WA), which was in the same terms as s 8 of the Code35. It is convenient to set out two passages – one from Starke J's reasons for judgment 33 Chan Wing-Siu v The Queen [1985] AC 168 at 175 (emphasis added). 34 (1936) 55 CLR 253. 35 Stuart v The Queen (1974) 134 CLR 426 discussed ss 8 and 9, but not this aspect of them. Crennan and one from those of Dixon and Evatt JJ – together with the comments on those passages made by Fitzgerald P in R v Hind and Harwood36. "A probable consequence is, I apprehend, that which a person of average competence and knowledge might be expected to foresee as likely to follow upon the particular act; though it may be that the particular consequence is not intended or foreseen by the actor. This is not a definition, but 'only a guide to the exercise of common sense'. Now if a person commits manslaughter who brings about the death of another by some unlawful act, then it must be taken, I think, that death is treated in law as a not improbable consequence of such an act, either because of the definition of the crime or because experience has established that such a result ought to be foreseen and expected. Under a proper charge, therefore, a verdict of manslaughter against the prisoner Brennan could upon the evidence be supported." "The overall effect of the passages emphasised is that it is sufficient to satisfy s 8 if a consequence was a real or substantial possibility; indeed, the second passage appears to assert that probability can be proved by linking cause and effect." Dixon and Evatt JJ said39: "[D]eath can be considered the probable consequence of the prosecution of the purpose if the purpose in which [Brennan] concurred made it likely that his confederates would, if necessary, use violence and such a kind or degree of violence as would probably cause death. The fact that, according to the verdict, they must be taken to have used an amount of force less than might have been contemplated by them, would not make the death, which ordinarily would not, but actually did, result from such a 36 (1995) 80 A Crim R 105 at 116-117. 37 (1936) 55 CLR 253 at 260-261. The emphasis is that given by Fitzgerald P. 38 R v Hind and Harwood (1995) 80 A Crim R 105 at 116. 39 (1936) 55 CLR 253 at 264. The emphasis is that given by Fitzgerald P. Crennan use of force, too remote a consequence for the prosecution of the purpose." Fitzgerald P commented40: "Again, the tenor of these statements is that it is sufficient to satisfy s 8 if there was a real possibility that an offence of the nature of the offence committed would be committed." The statements by Starke J and by Dixon and Evatt JJ explain "a probable consequence" in terms of likelihood, without explaining which degree of likelihood is relevant. For that reason alone it is not possible to agree with Fitzgerald P that the overall effect of the statements is that s 8 is satisfied if a particular consequence is a real possibility or a substantial possibility. As the appellants submitted, there is no detectable basis in Brennan v The King for that point of view. Fitzgerald P41 also discussed Johns v The Queen42, but that was a case on accessories before the fact at common law, and in any event, so far as it discussed "probable", it did not define it, except to contrast it with "possible". Pincus JA was of opinion in R v Hind and Harwood that "likely" in s 302(1)(b) of the Code conveyed "the idea that the act in question created a substantial or real chance of danger to human life, regardless of whether that chance was more or less than 50 per cent"43. The meaning he gave to "likely" in s 302(1)(b) was based on four matters. One was the construction given by this Court in Boughey v The Queen to the words "likely to cause death" in the provision in the Criminal Code (Tas) which is equivalent to s 302(1)(b) of the Code, namely, s 157(1)(c)44. He pointed out that the majority in that case said that "likely to cause death" conveyed "the notion of a substantial – a 'real and not remote' – chance regardless of whether it 40 R v Hind and Harwood (1995) 80 A Crim R 105 at 117. 41 R v Hind and Harwood (1995) 80 A Crim R 105 at 117-119. 42 (1980) 143 CLR 108. 43 R v Hind and Harwood (1995) 80 A Crim R 105 at 141. 44 (1995) 80 A Crim R 105 at 137-138, 141. Crennan is less or more than 50 per cent"45. The second matter was the meaning of the word "probable" in the test for malice aforethought at common law46: "If an accused knows when he does an act that death or grievous bodily harm is a probable consequence, he does the act expecting that death or grievous bodily harm will be the likely result, for the word 'probable' means likely to happen." The third matter referred to by Pincus JA47 was that in Brennan v The King: "Dixon and Evatt JJ in discussing s 8 adopted the test whether the purpose concurred in 'made it likely that [Brennan's] confederates would, if necessary, use violence and such a kind or degree of violence as would probably cause death'48. The notion that one is entitled to add a contingency ('if necessary') which may not itself be probable is implicit in this passage." And the fourth matter referred to by Pincus JA49 was the judgment of Gibbs J in Stuart v The Queen50. Pincus JA said that Gibbs J "rejected the notion that the question is whether 'viewed a priori, murder is a possible consequence of extortion'". Pincus JA then quoted Gibbs J's later statement: "It is not uncommon for deaths to occur when a fire breaks out in a building containing people." Pincus JA said of this language that it is "consistent with an equation of 45 Boughey v The Queen (1986) 161 CLR 10 at 21. Pincus JA also relied on the equation by Gibbs CJ of "likely" and "probable" – perplexingly, since Gibbs CJ disagreed with the majority on the question of whether a jury direction could be given using the word "chance". 46 (1995) 80 A Crim R 105 at 141, quoting R v Crabbe (1985) 156 CLR 464 at 469 per Gibbs CJ, Wilson, Brennan, Deane and Dawson JJ. Pincus JA also referred to the fact that in Boughey v The Queen (1986) 161 CLR 10 at 19 Mason, Wilson and Deane JJ pointed out that in R v Crabbe at 469-470 "probable" and "likely" were used as synonyms. 47 (1995) 80 A Crim R 105 at 141-142. 48 (1936) 55 CLR 253 at 264 (Pincus JA's emphasis). 49 (1995) 80 A Crim R 105 at 142. 50 (1974) 134 CLR 426 at 443 (Pincus JA's emphasis). Crennan 'probable' with 'likely' and with the notion that each implies that there is a substantial or real chance."51 These considerations do not support the conclusion that "a probable consequence" in s 8 means no more than "a substantial or real chance". As to the first point, authorities on the construction of the words "likely to cause death" in s 157(1)(c) of the Criminal Code (Tas) are not decisive on the meaning of the quite different words "a probable consequence" in s 8 or s 9 of the Code. The former words relate to the potential responsibility for murder as a principal offender of someone who has unlawfully killed another in the prosecution of an unlawful purpose. The latter words relate to the potential responsibility otherwise than as a principal offender for conduct which was not within a common purpose or a counselled offence, but which is only a consequence of the common purpose or the counselled offence. These differences in context and language suggest a construction which would make the test created by the former words – "likely to cause death" – easier to satisfy than the test created by the latter words – "a probable consequence"52. As to the second point, a common law test for malice aforethought is not necessarily applicable to s 8 or s 9, and the authority cited in any event does not explain what is meant by "likely". As to the third point, it is not convincing to rely on Dixon and Evatt JJ's use of the words "if necessary" to attribute to them adherence to a meaning for "probable" which they declined explicitly to state. As to the fourth point, between the two passages from Gibbs J's reasons for judgment in Stuart v The Queen quoted by Pincus JA appeared the following53: "Under s 8 it is necessary for the jury to consider fully and in detail what was the unlawful purpose and what its prosecution was intended to entail 51 (1995) 80 A Crim R 105 at 142. 52 Furthermore, Gibbs CJ and Brennan J disagreed with the majority view stated in Boughey v The Queen (1986) 161 CLR 10 at 22 per Mason, Wilson and Deane JJ: see at 15 and 42-44. 53 (1974) 134 CLR 426 at 443. Crennan and what was the nature of the actual crime committed, and then to decide whether that crime was of such a nature that its commission was a probable consequence of the prosecution of that purpose." Gibbs J then analysed the facts of the particular case in detail. It was as part of that analysis that the second passage quoted by Pincus JA appears. In those circumstances it does not follow that Gibbs J was asserting that "not uncommon" should be treated as being equivalent to "likely" and "probable". The authorities relied on in the Queensland Court of Appeal do not support the conclusion at which it arrived and which trial courts in that State have been applying. Is it possible nonetheless to justify the conclusion as a matter of principle? "A probable consequence" is not a consequence more likely to have happened than not The parties agreed that "a probable consequence" did not mean a consequence likely to happen on the balance of probabilities. They were correct for several reasons. One is that in ss 8 and 9(1) the expression is "a probable consequence", not "the probable consequence". Had the expression been "the probable consequence", it would have pointed towards a balance of probabilities test. The expression actually used points against that test. The expression "a probable consequence" is compatible with there being more inconsistent probable consequences than one resulting from the prosecution of a particular purpose or the carrying out of particular counsel; where there are a number of inconsistent "probable" consequences it is difficult to see how all can be more probable than not. A second reason is that if a balance of probabilities test applied, it would mean that accused persons could escape conviction if the prosecution failed to do more than demonstrate that the risk of the consequence described in ss 8 and 9 was plainly there and that the odds were only just against it54. Yet that outcome would appear to be contrary to the structure of the two sections, the function of which is to widen criminal responsibility. That is, the objects of ss 8 and 9 could be frustrated if "a probable consequence" of an event meant "a consequence 54 See R v Piri [1987] 1 NZLR 66 at 78 per Cooke P, McMullin and Somers JJ concurring. Crennan which, judged from the time of the event, was more probably likely to happen than not"55. Finally, as counsel for the second appellant submitted: "The Code could easily read 'a consequence that was more probable than not'. It does not." "A probable consequence" is not a consequence which is barely possible the view The respondent did not contend for that "a probable consequence" referred to one which was no more than barely possible. In that it was correct. Under the common law rule dealing with the same problem as s 8, criminal responsibility depends "upon the jury's assessment of whether or not the accessory before the fact must have been aware of the possibility that responses by the victim or by third parties would produce the reaction by the principal offender which led to the [crime which the principal offender committed]"56. Thus at common law the test is "subjective", not "objective". It depends upon the defendant's awareness of possibilities, and not on the existence, independently of the defendant's awareness, of probabilities. The selection by the legislature of an objective, not a subjective test, and the selection of the language of probability, not possibility (let alone bare possibility), point towards a construction of ss 8 and 9 as excluding the sufficiency of bare possibilities. "A probable consequence" means more than a "real possibility or chance" The respondent accepted that "a probable consequence" meant more than a consequence which was reasonably possible or which had a reasonable chance of coming to pass. That stance was sound, because ss 8 and 9 mark a contrast between establishing what is probable and what is possible, and the contrast is significant. The reasons why that is so are discussed below57. It is now necessary to examine the arguments of the parties on the points about which they disagreed. 55 See, for example, R v Gush [1980] 2 NZLR 92 at 95 per Richmond P, Richardson and O'Regan JJ; R v Hagen, Gemmell and Lloyd unreported, Court of Appeal of New Zealand, 4 December 2002 at [46] per Tipping, McGrath and Anderson JJ. 56 Johns v The Queen (1980) 143 CLR 108 at 118 per Stephen J (emphasis in original); see also at 130-131 per Mason, Murphy and Wilson JJ. 57 See at [72]-[81]. Crennan Did the trial judge err in explaining the meaning of "a probable consequence"? The first and second appellants submitted that the trial judge had erred in saying anything about the meaning of "a probable consequence". They contended that the expression required no elaboration, being well understood by ordinary people58, and that attempts to elaborate it are likely to lead to confusion. They referred to a statement by Sir Samuel Griffith: "A Code ought, if possible, to be so framed as to require no definitions of terms in common use in ordinary speech or writing."59 They also relied on various statements in the authorities. One was a statement by Kirby J in a case concerning s 23 of the Code. He said that the provisions of the Code "should be capable of being explained to a jury, according to their own terms, which (at least in the present connection) are relatively simple in their expression"60. Another statement on which the first and second appellants relied was that of Mason, Wilson and Deane JJ in Boughey v The Queen61: "A basic objective of any general codification of the criminal law should be, where practicable, the expression of the elements of an offence in terms which can be comprehended by the citizen who is obliged to observe the law and (where appropriate) by a jury of citizens empanelled to participate in its enforcement ... The courts should, however, be wary of the danger of frustrating that basic purpose of codification of the criminal law by unnecessarily submerging the ordinary meaning of a commonly used word in a circumfluence of synonym, gloss and explanation which is more likely to cause than to resolve ambiguity and difficulty." The first and second appellants relied on a model direction given by the Western Australian Court of Criminal Appeal in relation to liability under the Western 58 Relying on R v Salmon & James [2003] QCA 17 at [45] per McMurdo P, Jerrard JA concurring at [69] and Helman J at [70]. 59 "An Explanatory Letter to the Honourable the Attorney-General", in Draft of a Code of Criminal Law prepared for the Government of Queensland, (1897) at viii. 60 Murray v The Queen (2002) 211 CLR 193 at 218 [78]. 61 (1986) 161 CLR 10 at 21. Crennan Australian equivalents of s 8 and s 302(1)(b)62, which contained no elaboration of the meaning of "probable". Finally, the first and second appellants submitted that "a probable consequence" was an expression like "beyond reasonable doubt", which this Court has repeatedly said is not to be elaborated upon63. The submission that the trial judge erred in saying anything about the meaning of "a probable consequence" is to be rejected. In R v Piri, Cooke P said, correctly with respect, in rejecting a similar argument64: "With some ordinary English words that is a feasible and accepted approach. And with the words 'likely' and 'probable' there are occasions when it is unnecessary for the Judge to expand on their meaning; the Judge can simply leave the case to the jury without elaboration in this respect. But where a critical issue as to the degree of likelihood or probability clearly arises, that may not do. The jury may then be entitled to more guidance". There is also Canadian authority that it is permissible to explain the meaning of a provision similar (but not identical) to s 8, namely, s 21(2) of the Criminal Code (Can)65. The expression "a probable consequence" consists of ordinary English words, but they have no single meaning common to lay speakers. Acceptance of the argument advanced by the first and second appellants would mean that trial judges would be precluded from answering questions posed by jurors about the meaning of the expression "a probable consequence". In a given case a jury might understandably experience difficulties with the expression "a probable consequence" while in another case a different jury may not. A rule of law 62 R v Seiffert and Stupar (1999) 104 A Crim R 238 at 247-248 per Pidgeon J, Kennedy and White JJ concurring. 63 For example, Thomas v The Queen (1960) 102 CLR 584 at 595 per Kitto J; Dawson v The Queen (1961) 106 CLR 1 at 18 per Dixon CJ; Green v The Queen (1971) 126 CLR 28 at 32-33 per Barwick CJ, McTiernan and Owen JJ. 64 [1987] 1 NZLR 66 at 79, McMullin and Somers JJ concurring. 65 R v Cribbin (1994) 89 CCC (3d) 67 at 77 per Morden ACJO, Catzman and Arbour JJA. Crennan which banned judicial attempts to deal with these difficulties would be perverse. Acceptance of the argument advanced by the first and second appellants would also create a formulaic approach to summing up. The function of a summing up is to furnish information which will help a particular jury to carry out its task in the concrete circumstances of the individual case before it and in the light of the trial judge's assessment of how well that jury is handling its task. It is undesirable for a summing up to assume the character of a collection of hallowed phrases mechanically assembled on a priori principles to be mouthed automatically in all circumstances, whether or not a particular jury actually understands them. If a judge sees it as desirable to explain the meaning of "a probable consequence" – perhaps because it is perceived that some jurors may think it calls for a balance of probabilities analysis while others may think it refers to relatively remote possibilities – the Code does not prevent this from being done. To reject the argument advanced by the first and second appellants is not to depart from the views of Sir Samuel Griffith or the statements in this Court quoted earlier. Sir Samuel was speaking of how a Code should be framed, not of how a jury should be directed. Kirby J's observations in Murray v The Queen were directed to "relatively simple" provisions: the meaning of "a probable consequence" is not relatively simple, but differs with context. The observation of Mason, Wilson and Deane JJ in Boughey v The Queen about drafting Codes so as to make them comprehensible to juries was qualified by the words "where practicable", and their warning about not submerging ordinary meanings of commonly used words was a warning only against doing so "unnecessarily": it is not always practicable to avoid explanations of "a probable consequence" and it may be necessary to give them. Indeed, in that very case, Mason, Wilson and Deane JJ, after quoting part of the trial judge's summing up there under challenge in which he offered an account of what "likely to cause death" meant, said that the passage "contained helpful and correct guidance for the jury" in making the point that it "is an ordinary expression which is meant to convey the notion of a substantial or real chance as distinct from what is a mere possibility: 'a good chance that it will happen'; 'something that may well happen'; something that is 'likely to happen'"66. Further, the fact that in some cases, such as R v Seiffert and Stupar67, a direction contained no explanation of "probable" does not establish that other directions which do seek to explain it are on that ground alone erroneous. 66 Boughey v The Queen (1986) 161 CLR 10 at 22. 67 (1999) 104 A Crim R 238 at 247-248 per Pidgeon J, Kennedy and White JJ concurring. Crennan The stand which this Court has taken on the expression "beyond reasonable doubt" – that it alone must be used, and nothing else – has not been shared elsewhere68. Even in Australia it is an extreme and exceptional stand. The justification for it rests on several considerations. One is that "beyond reasonable doubt" is an expression "used by ordinary people and is understood well enough by the average man in the community"69. That is not so of "a probable consequence". A second consideration is that departures from the formula "have never prospered"70. That has not been demonstrated to be the case in relation to "a probable consequence". A third consideration is that expressions other than "beyond reasonable doubt" invite the jury "to analyse their own mental processes"71, which is not the task of a jury. "They are both unaccustomed and not required to submit their processes of mind to objective analysis"72. Explanation of the expression "a probable consequence" does not require this of juries. Finally, as Kitto J said in Thomas v The Queen73: "Whether a doubt is reasonable is for the jury to say; and the danger that invests an attempt to explain what 'reasonable' means is that the attempt 68 Walters v The Queen [1969] 2 AC 26 at 29 per Lord Diplock; Ferguson v The Queen [1979] 1 WLR 94 at 99; [1979] 1 All ER 877 at 882 per Lord Scarman (in general it is wise to employ "beyond reasonable doubt", but "other words will suffice, so long as the message is clear"). In New Zealand it is permissible to elaborate on the words to some extent (R v Harbour [1995] 1 NZLR 440 at 448 per Richardson, Casey, Hardie Boys, McKay and Tompkins JJ), as by contrasting a reasonable doubt with a "vague or fanciful doubt": R v Speakman (1989) 5 CRNZ 250 at 260. To similar effect are cases in Canada (R v Lifchus [1997] 3 SCR 320 at 327-330 [15]-[22] per Lamer CJ, Sopinka, Cory, McLachlin, Iacobucci and Major JJ (La Forest, L'Heureux-Dubé and Gonthier JJ concurring)) and the United States (Victor v Nebraska 511 US 1 at 26 (1994) per Ginsburg J). 69 Dawson v The Queen (1961) 106 CLR 1 at 18 per Dixon CJ; Green v The Queen (1971) 126 CLR 28 at 31 per Barwick CJ, McTiernan and Owen JJ. 70 Dawson v The Queen (1961) 106 CLR 1 at 18 per Dixon CJ. 71 Thomas v The Queen (1960) 102 CLR 584 at 606 per Windeyer J. 72 Green v The Queen (1971) 126 CLR 28 at 33 per Barwick CJ, McTiernan and 73 (1960) 102 CLR 584 at 595. Crennan not only may prove unhelpful but may obscure the vital point that the accused must be given the benefit of any doubt which the jury considers reasonable." There is not in that respect any analogy between "beyond reasonable doubt" and "a probable consequence". Did the trial judge err in saying more than that "probable" meant "likely"? The second appellant in particular then fell back on an argument that, if the trial judge was entitled to say anything, he was entitled only to say that "probable consequence" meant "likely consequence". To go further would involve using other phrases to explain "probable" and "likely" which themselves would tend to multiply the risks of confusion and to undercut the benefits at which codification was aimed. The flaw in this argument is that just as the range of possible meanings for "probable" may justify some explanation of the expression, to offer as an explanation that the word means "likely" is only to point to a further word which also carries diverse meanings. What directions may and may not be given? The first and third appellants did not explicitly advance any argument beyond the two just examined. But implicit in their position was a further contention, which eventually was explicitly advanced on behalf of the second appellant: that even if the trial judge did not err in commenting at all on the meaning of "a probable consequence", and even assuming he did not err in going beyond an equation of "probable" and "likely", what he actually said was erroneous. It was erroneous in that he failed to steer a course between saying that a probable consequence was one which was more likely to occur than not (which would have been unduly generous to the appellants), and saying that a probable consequence was a real or substantial possibility or chance (which he in fact said, and which was unduly harsh to the appellants). This criticism is sound, for the following reasons. First, the context in which the expression "a probable consequence" appears must be borne in mind. While it is true that ss 7, 8 and 9 apply to many offences other than murder, the crime charged here was murder. Section 305(1) of the Code provides that conviction carries a mandatory and single penalty, the highest known to the law – life imprisonment. Further, the form of liability for murder under consideration is accessorial. Accessorial liability is old, but it is an Crennan exception to the general rules of criminal responsibility. Persons liable under s 7, s 8 or s 9 need not be present at the scene of the crimes for which they are convicted, and the fact that those crimes might be committed by the principal offender may never have entered their heads. In construing "a probable consequence" in ss 8 and 9, the extent to which it is likely that Parliament has created strict or vicarious liability in accessories must be considered. Secondly, the key word in ss 8 and 9 is "probable", not "possible". The word "probable" has diverse meanings, but all common usages of it suggest a more exacting standard than "possible"74. Further, whatever the common law in the late 19th century was in relation to the problem dealt with by s 8 of the Code, it is clear that now at common law an accessory is liable if the principal offender's crime is "foreseen as a possible incident of the common unlawful enterprise"75. Although the law has long recognised accessorial liability, it has also long attempted to lay down limits to the accessorial liability of a person who shared a common purpose with a wrongdoer, or who instigated a wrongdoer to commit a crime. The alleged accessory is not to be liable for everything a principal offender did, either vicariously or absolutely. Over time the law has employed different techniques for placing accessorial liability within just limits while continuing to give it substantial room for operation. The common law protects against excessively wide liability by demanding actual foresight, albeit of a possibility. Under ss 8 and 9 of the Code the function of protecting against excessively wide liability turns on the need for probability of outcome, independently of the alleged accessory's state of mind. If under ss 8 and 9 of the Code the expression "a probable consequence" were construed so as to make a possible consequence sufficient, there would be liability in the accessory for whatever the principal offender did, since the fact that the principal offender did it shows that it was possible, and there would be no protection against excessively wide liability. Authority in other jurisdictions with similar legislation stresses the contrast between "probable" and "possible". Thus, the New Zealand Court of Appeal, applying s 66(2) of the Crimes Act 1961, which turns on what is "known to be a probable consequence", could "see no justification for reading 'probable 74 See also R v Crabbe (1985) 156 CLR 464 at 469-470 per Gibbs CJ, Wilson, Brennan, Deane and Dawson JJ. 75 Chan Wing-Siu v The Queen [1985] AC 168 at 175. Crennan consequence' in s 66(2) as 'possible consequence'"76. The same court stressed the need for the summing up to emphasise that the consequences were "probable, not merely possible"77. In Canada, too, where s 21(2) of the Criminal Code centres on whether the accessory "knew or ought to have known that the commission of the offence would be a probable consequence" of the carrying out of the unlawful purpose, it is customary to distinguish between what is probable and what is possible78. The difficulty in defining "a probable consequence" is that once it is accepted that "probable" does not mean "on the balance of probabilities" and that it means more than a real or substantial possibility or chance, it is difficult to arrive at a verbal formula for what it does mean and for what the jury may be told. The expression "a probable consequence" means that the occurrence of the consequence need not be more probable than not, but must be probable as distinct from possible. It must be probable in the sense that it could well happen79. In this case, the s 8 question is whether "the offence" – murder by killing the deceased with intent to do some grievous bodily harm – was "a probable consequence" of the prosecution of the common intention of the appellants to prosecute the unlawful purpose of assaulting the deceased. In this case, the s 9 question is whether "the facts constituting the offence actually committed" – the killing of the deceased with intent to do some grievous bodily harm – are "a probable consequence" of carrying out the second appellant's counsel. It is not necessary in every case to explain the meaning of the expression "a probable consequence" to the jury. But where it is necessary or desirable to do 76 R v Gush [1980] 2 NZLR 92 at 94 per Richmond P, Richardson and O'Regan JJ. 77 R v Waho unreported, Court of Appeal of New Zealand, 27 April 2005 at [31] per Hammond, Robertson and Potter JJ. See also R v Rapira (2003) 20 CRNZ 396 at 413-414 [53] per Elias CJ, Gault P and McGrath J. 78 R v Kirkness [1990] 3 SCR 74 at 110 per Wilson and L'Heureux-Dubé JJ (dissenting, but not on this point). 79 R v Gush [1980] 2 NZLR 92 at 94 per Richmond P, Richardson and O'Regan JJ; R v Hagen, Gemmell and Lloyd unreported, Court of Appeal of New Zealand, 4 December 2002 at [46] per Tipping, McGrath and Anderson JJ. Crennan so, a correct jury direction under s 8 would stress that for the offence committed to be "a probable consequence" of the prosecution of the unlawful purpose, the commission of the offence had to be not merely possible, but probable in the sense that it could well have happened in the prosecution of the unlawful purpose. And where it is desirable to give the jury a direction as to the meaning of the expression "a probable consequence" in s 9, a correct jury direction would stress that for the facts constituting the offence actually committed to be "a probable consequence" of carrying out the counselling, they had to be not merely possible, but probable in the sense that they could well have happened as a result of carrying out the counselling. Did the trial judge's directions comply with the necessary criteria? The respondent contended that the trial judge's direction in this case did not fail to comply with these criteria. The respondent's argument was that the word "possibility" in the impugned part of the summing up was qualified by the word "real" and the word "chance" by the words "substantial" and "real". On this basis, the respondent submitted that the jury would not have been left with the impression that the appellants could be found guilty in relation to outcomes that were merely possible. That may be true, but the trial judge's direction, compelled by authority as it was, carried the risk of leaving the jury with the impression that the appellants could be found guilty in relation to outcomes which, while more than merely possible, in that they were substantial or real, were not probable. Hence, contrary to the respondent's submissions, the direction that was given by the trial judge was flawed in that it did not convey the idea that the consequence to be looked for was "a probable or likely outcome". Each appellant has established that the summing up was wrong in law. The point raised by each appeal is thus to be decided in favour of each appellant. The question remains whether the appeals should be dismissed on the ground that "no substantial miscarriage of justice has actually occurred" within the meaning of s 668E(1A) of the Code. The proviso: general considerations An appellate court invited to consider whether a substantial miscarriage of justice has actually occurred is to proceed in the same way as an appellate court invited to decide whether a jury verdict should be set aside on the ground that it is unreasonable, or cannot be supported having regard to the evidence. The appellate court must make its own independent assessment of the evidence and determine whether, making due allowance for the natural limitations that exist in the case of an appellate court proceeding wholly or substantially on the record, Crennan the accused was proved beyond reasonable doubt to be guilty of the offence on which the jury returned its verdict of guilty80. A statement of Keane JA in the Court of Appeal in this case provides a starting point. As a matter preparatory to explaining why the second appellant's appeal to the Court of Appeal on the ground that her conviction was unreasonable should be rejected, he said that the nature and extent of the injuries inflicted on the deceased compelled the conclusion that whoever inflicted them did so with the intention of at least doing grievous bodily harm to the deceased81. With respect, that is correct. It is now necessary to consider the evidence against each appellant. The proviso: the first appellant In an initial interview with the police, the first appellant denied any involvement in causing the deceased's death. In a later interview he admitted to the police that while he had given the deceased a "hiding", and was not the only person who had done so, he had used only his bare hands and that it was the third appellant who had used the pickaxe handle. At a further interview he said that the second appellant had told him that she wanted the deceased bashed in the dark and wanted more help, and that the deceased had raped her daughter. He heard the second appellant tell the third appellant to get a weapon, and saw the third appellant go into his house and come out with the pickaxe handle and wearing steel-capped boots. He saw the second appellant hide the pickaxe handle in the van. He observed the deceased's reluctance to leave the van. Before the fight began, the second appellant took the pickaxe handle from the van and hid it behind a bush. She then told the third appellant to get it, and told the first appellant to hit the deceased. The first appellant punched the deceased four times. The deceased fell to the ground, and the first appellant, the third appellant and Bowen began kicking him in the presence of the second appellant. The second appellant called for someone to get the pickaxe handle and, when nobody did, she got it herself. With it she gave the deceased a couple of "good swings" in the back of the neck. The first appellant then departed as the deceased's blood spread "all over the place". 80 Weiss v The Queen (2005) 80 ALJR 444 at 454-455 [41] per Gleeson CJ, Gummow, Kirby, Hayne, Callinan and Heydon JJ; 223 ALR 662 at 673-674. 81 R v Deemal-Hall, Darkan & McIvor [2005] QCA 206 at [10]. Crennan Bowen's evidence suggested that in this account the first appellant had minimised his role, which included kicking the deceased with steel-capped boots and using the pickaxe handle extensively. Michael James Cobus also implicated the first appellant: his evidence was that the second appellant's attempt to persuade Cobus to "touch up" the deceased was witnessed by the first appellant. The respondent submitted that, quite independently of s 8 of the Code, the evidence revealed that the first appellant was guilty of murder by reason of either s 7(1)(a) or s 7(1)(c), respectively read with s 302(1)(a). These cases had been left to the jury. The respondent submitted that the first appellant's admissions showed that he intended to do some grievous bodily harm to the deceased, and that he either unlawfully killed the deceased with that intent, or aided the third appellant in unlawfully killing the deceased with that intent. These submissions are correct. An invitation to inflict a bashing at night in a lonely place in company on a man of violent disposition is an invitation intentionally to inflict grievous bodily harm. Whether or not the first appellant used the pickaxe handle, and whether or not it was used as little as he suggested, each punch or kick he inflicted assisted the third appellant in committing murder under s 302(1)(a) because it diminished the will and the ability of the deceased to resist the bashing which the participants had agreed would be given. Counsel for the first appellant contended that the case against the first appellant depended on Bowen's credibility. Counsel had in mind the fact that Bowen was a witness whose evidence was to be examined with care. Originally he had been charged with murder, but after pleading guilty to a contravention of s 339 of the Code (assault occasioning bodily harm while in company), he received a sentence which was partly suspended and which led to his release after the plea was taken. Bowen accepted that he received a lesser sentence by reason of a promise to give evidence for the prosecution against the three appellants. Counsel submitted that since this Court was not in a position to assess Bowen's credibility, the case was unsuitable for the application of the proviso. Combining the first appellant's account with the injuries suffered by the deceased, it is clear that the deceased's death was caused by someone who intended to do the deceased grievous bodily harm. The first appellant on his own admission knowingly aided the third appellant, who plainly had the intention of causing grievous bodily harm to the deceased and who must have caused the deceased's death if the first appellant did not. Hence a case of murder beyond reasonable doubt is established against the first appellant. This reasoning does not depend on Bowen's evidence, and it is not weakened by any infirmities in Crennan Counsel for the first appellant also said that questions arose about the reliability of what the first appellant had said to the police. Since the first appellant did not give evidence denying the correctness of what he had said in mechanically recorded interviews, those are not questions, assuming they are capable of arising, which can be answered favourably to the first appellant. Counsel for the first appellant also contended that since the jury had been misdirected about s 8, the first appellant had not had a trial according to law. The other appellants advanced similar arguments. In Weiss v The Queen82 this Court put aside questions relating to two particular kinds of defect in a trial. One was whether the proviso could be applied when there had been "a significant denial of procedural fairness". This does not arise, because the trial was procedurally fair. The other was whether the proviso could be applied where there had been a sufficiently "serious breach of the presuppositions of the trial". This was a reference to a trial which had "so far miscarried as hardly to be a trial at all" or "where an irregularity has occurred which is such a departure from the essential requirements of the law that it goes to the root of the proceedings"83. Neither defect existed in relation to the trial so far as it concerned the first appellant. The case against the first appellant was put to the jury on three bases. In relation to one of them, there was a misdirection. The first appellant's admissions made a conviction inevitable on one if not both of the other two bases. There is no reason why the proviso should not be applied in relation to those bases. Counsel also referred to a statement by Kirby J of the accused's entitlement "to have a jury properly instructed on the elements of the offences charged"84. His Honour did not, however, say that in the event of misdirection the proviso could not be applied: his point was rather that it "will often be inappropriate, where misdirection is shown, to invoke a provision such as 82 (2005) 80 ALJR 444 at 455 [45]-[46] per Gleeson CJ, Gummow, Kirby, Hayne, Callinan and Heydon JJ; 223 ALR 662 at 675. 83 Wilde v The Queen (1988) 164 CLR 365 at 373 per Brennan, Dawson and 84 KBT v The Queen (1997) 191 CLR 417 at 433. Crennan s 668E(1A) of the Code, even in a strong prosecution case"85. His Honour was not there dealing with proceedings which could scarcely be described as trials at all. However, even if it is assumed that some misdirections cannot be overcome by recourse to the proviso, that is not so of this misdirection. Proviso: case against the third appellant The respondent submitted that the third appellant was guilty of murder either because he killed the deceased intending to do him grievous bodily harm, or because his acts aided the first appellant to kill the deceased in the knowledge that the first appellant intended to do him grievous bodily harm. The third appellant gave the following account to the police. The first appellant told the third appellant that the second appellant wanted them "to smash this fellow up" for money, and that she had told the first appellant: "just come and just bash this lad for me". She asked what a "good spot" would be at which "to get this bloke". The third appellant anticipated that the deceased would suffer a couple of broken bones and be put in hospital. He went home to put on his steel-capped boots with a view to damaging the deceased. The first appellant asked the second appellant what the deceased was like; when she said he was a big man, the first appellant asked the third appellant if he had a stick to use as a weapon. The third appellant obtained the pickaxe handle, and gave it to the first appellant. After the deceased fell to the ground, the third appellant gave him "a little soft kick in the mouth" and kicked him two or three times in the ribs. The first appellant kicked the deceased at the same time. The first appellant asked for the pickaxe handle, and the third appellant supplied it, but evidently fearing that the first appellant would hit the deceased on the head with it, said "Don't kill him" and "Just knock him out". He saw the first appellant hitting the deceased with the pickaxe handle from his feet to his ribs and on the head and "smashing his jaw around" with it; he thought the deceased would suffer a couple of broken bones and a broken jaw. There was other evidence against the third appellant (apart from Bowen's). His former de facto wife saw him leave home after putting his steel-capped boots on. On his return he showed her a $50 note and the pickaxe handle covered in blood. He told her that he had been in a fight and expected to receive a further $1,000. He told another witness that he had "bashed this guy in the park" with the pickaxe handle. 85 KBT v The Queen (1997) 191 CLR 417 at 434. Crennan In the Court of Appeal, Keane JA correctly said that the prosecution case that the third appellant's assault on the deceased was effected with the intention of causing grievous bodily harm was overwhelming86. The evidence also supported the conclusion, beyond a reasonable doubt, that the third appellant aided the first appellant, knowing of the first appellant's intent to do the deceased grievous bodily harm. Counsel for the third appellant, realistically and responsibly, accepted that there was evidence in the form of the third appellant's admissions capable of establishing his guilt beyond a reasonable doubt. The only point he advanced against the application of the proviso was that there had been a significant denial of procedural fairness. He said that the significant denial of procedural fairness lay in the fact that the summing up urged on the jury the s 8 route to conviction as one which did not require attention to the question whether the third appellant had an intention to do grievous bodily harm, and stressed the erroneous character of the s 8 direction. However, the avenues to conviction now relied on by the respondent were left to the jury, and there was no error in the directions about this. These circumstances do not result in a significant denial of procedural fairness. There is no reason not to apply the proviso against the third appellant. Proviso: the second appellant Contrary to the position with the first and third appellants, the respondent supported the application of the proviso to the second appellant by reference to s 9. At trial the second appellant's case was that the evidence suggested only that the attack she had requested would result in an assault, and that its probable result was not the intentionally caused death of the deceased or death following the intentional infliction of grievous bodily harm. She relied on the proposition that all she asked for was a "touch-up". The evidence admissible against her, however, establishes that she spent some time on the evening of the crime arranging for three men to attack the deceased, whom the men did not know, for an initial payment of $150, transporting the men to the site, and enticing the deceased to come to it. She also attempted to recruit another man. She borrowed the promised $150 from a friend. She told the police that the deceased was "very violent", and a "very strong man, it would have taken quite a few to hold him down". 86 R v Deemal-Hall, Darkan & McIvor [2005] QCA 206 at [90]. Crennan Keane JA in the Court of Appeal said that there was a compelling case that the beating administered by the first and third appellants proceeded to her satisfaction and in conformity with the common intention for which she had recruited them87. His Honour was correct. Counsel for the second appellant submitted that the second appellant "was clearly not at the scene for the entire time" and that there was no proof that she knew of the strength of the men she hired, their propensities, their footwear or their possession of a pickaxe handle. These submissions are incorrect. There was uncontradicted evidence that she was there at the start, because she arrived with the deceased. She was there when the punching started, she was there when Bowen saw her watching the deceased being hit on the legs with the pickaxe handle, and she was there at the end when she drove away. It may be presumed that she remained at the site in the intervals between these points. There is no evidence that she did not. Before the deceased was taken to the site, the second appellant would have been able to judge the strength of the young men she had recruited as assailants from their appearance. She could infer their propensities from the fact that they were prepared to beat up a stranger for money. While she was at the site she would have learned more about their propensities, their footwear and the pickaxe handle. She did not protest about what was happening. The best evidence of what she counselled is what actually happened in her unprotesting presence. Having asked for something to be done which involved three men assaulting as violent and strong a man as the deceased, having seen without protest a long and brutal beating administered, having failed to show any concern for the deceased after she left, having failed to respond to the deceased's cry for assistance communicated to her by Bowen, and having thereafter lied to the police and others about her lack of knowledge of the deceased's movements on the evening on which he died, it is not possible to avoid drawing a strong circumstantial inference that the intentional infliction of grievous bodily harm on the deceased was what the second appellant wanted to happen and what she wanted the assailants to do. She counselled an assault on the deceased which involved at least one, and probably both, of the first and third appellants attacking the deceased with intent to cause him grievous bodily harm in such a manner that murder – an unlawful killing with intent to cause grievous bodily harm – was a probable consequence of carrying out her counsel. It was a probable consequence because the assault directed at the deceased was a beating up, it was probable that the deceased, a violent man, would resist the beating up with violence of his own, and it was probable that the assailants would form an intent to cause grievous bodily harm during the fight even if they had not done so 87 R v Deemal-Hall, Darkan & McIvor [2005] QCA 206 at [74]. Crennan before it started. Hence the second appellant was rightly convicted of murder pursuant to s 302(1)(a), s 7(1)(d) and s 9(1). However, counsel for the second appellant submitted that the error in direction was so serious a breach of the presuppositions of a criminal trial as to prevent the proviso from being applied. It was not an error as to an ancillary direction or as to something incidental to the trial. It was so important that there could not be said to have been a trial at all. It is true that the error went to an element in the case advanced against the second appellant at trial (unlike the position with the first and third appellants, in respect of whom there were other paths to conviction unaffected by the error). However, the second appellant's complaints about the summing up had a double aspect. One was that no direction at all should have been given; the other was that the direction was wrong in its terms. It is relevant that counsel did not ask the trial judge not to give, or to withdraw, the direction. It is true that if a direction were to be given, justification could be found for the form of the words used by the trial judge in R v Hind and Harwood. But that case did not mandate that any direction be given. It was open to counsel to request that the direction not be given, or that it be withdrawn. The proposition that no direction should have been given was rejected above, but the failure of counsel to request that it not be given or that it be withdrawn suggests that counsel did not perceive the direction as especially damaging to the second appellant's interests. It is also relevant that the error affected only the degree of probability required. The trial judge repeatedly referred to the concept of probability; his error was to speak of a real or substantial possibility or chance, rather than a level of probability below the balance of probabilities. The fact is that whatever the meaning of "a probable consequence", the circumstances engineered by the second appellant fell within the expression. The complaints of the second appellant in particular about the direction appear to have been formulated after the conviction for appellate purposes. Even though they go to an aspect of the crimes charged in one of their elements, their nature is not such as to suggest that there was in truth no trial at all. Finally, the second appellant submitted that there were "real difficulties" in applying the proviso in this case because of the "impossibility of distinguishing between murder and manslaughter". She submitted that this was the case, particularly in view of the difficulties of assessing Bowen's credit and determining what was meant by the phrase "touch-up", these being matters quintessentially for a Cairns jury familiar with local conditions. These submissions were not developed. Counsel for the second appellant at the trial (who did not appear on the appeals) said in final address that the prosecution advanced Bowen as "a witness of truth, and I embrace that to a large extent". No Crennan doubt it was for that reason that in cross-examination he controverted very little of what Bowen had said in chief, beyond putting into his mouth the propositions that all that was planned was a "touch-up" and that nothing was "discussed" about kicking the deceased or using a weapon on him. Counsel suggested to this Court that: "when Bowen gave evidence that the plan was for nothing more than a touch up, there may have been something sufficiently convincing about him in that regard to negate the inferences which can be drawn from [the other circumstances], and that is where, no matter how strong the Crown case might be to be made from those other inferences, you sitting here cannot deprive the appellant of the opportunity of having those considered by a jury." Apart from contradicting the contention that Bowen lacked credit, this was unconvincing. In these circumstances it is clear that the second appellant was guilty of murder by reference to s 302(1)(a), s 7(1)(d) and s 9(1), and that this conclusion can be arrived at without having to rely on any controversial parts of Orders Each appeal should be dismissed. Kirby 111 KIRBY J. In these appeals, from the Court of Appeal of the Supreme Court of Queensland88, a majority of this Court has upheld the substance of the appellants' challenges to the directions given to the jury. However, it has dismissed the appeals by the application of the 'proviso'89. I agree that the appellants' challenges to the accuracy of the instructions given to the jury should be upheld. However, I disagree with the conclusion that the appeals should be dismissed on the ground that "no substantial miscarriage of justice has actually occurred". Essentially, my point of disagreement relates to the importance of the error in the judge's charge to the jury for the accurate trial of the appellants according to law; the significance of the error for the way the jury may have reasoned; and the centrality of the postulate that lies behind the way in which serious criminal charges are ordinarily determined in this country. That postulate envisages the verdict of a jury, properly instructed on the legal ingredients of the offences charged, without error upon such ingredients that might have affected the outcome of the trial90. In order to understand the nature of the appellants' complaint, it is important to consider the impugned direction in context. The prosecution cases against the first and third appellants were that each (1) independently committed the offence of murder91; (2) aided the other to commit the offence of murder92; and (3) was guilty of murder because they formed a "common intention to prosecute an unlawful purpose in conjunction with one other [and the second appellant], and in the prosecution of such purpose" the commission of the offence of murder was a "probable consequence" of the prosecution of such purpose93. The prosecution case against the second appellant was presented in somewhat different terms. In common with the charges against the first and third appellants, liability on the basis of a common intention to prosecute an unlawful purpose was propounded. However, the prosecution also maintained that the second appellant was liable on the basis that she had counselled the commission 88 R v Deemal-Hall, Darkan & McIvor [2005] QCA 206. 89 Criminal Code (Q), s 668E(1) and (1A). 90 Mraz v The Queen (1955) 93 CLR 493 at 514; Driscoll v The Queen (1977) 137 CLR 517 at 524; R v Storey (1978) 140 CLR 364 at 376; Gallagher v The Queen (1986) 160 CLR 392 at 412-413; Wilde v The Queen (1988) 164 CLR 365. 91 Criminal Code (Q), ss 7(1)(a) and 300. 92 Criminal Code (Q), ss 7(1)(c) and 300. 93 Criminal Code (Q), s 8. Kirby of the assault against the deceased94. Significantly, s 9(1) of the Criminal Code (Q) ("the Code") provides that a person who counsels the commission of an offence is liable for any other offence committed provided that "the facts constituting the offence actually committed are a probable consequence of carrying out the counsel". In the course of directing the jury on s 9(1), the trial judge, conforming to authority binding on him95, stated that "a probable consequence" was one which was "a real possibility or a substantial [chance] or a real chance" in the circumstances96. Although this direction only immediately concerned s 9(1) of the Code, the words "probable consequence" were used by the trial judge in his directions on common intention. It was accepted by the respondent that, consequently, this could have affected the liability of the first and third appellants and the alternative prosecution case against the second appellant based on common intention. There is a great difference between deciding that serious harm to the victim was a "probable consequence" and that it was a possibility or a chance (even if qualified by "substantial" or "real"). In my view, the error in the judge's direction deprived the appellants of a trial according to law. Their convictions were not inevitable97. This Court is not properly equipped, effectively for the first time, to try the appellants on the record. A new trial should be had before a jury, properly instructed on the law. The facts and the provisions of the Code The facts: The reasons of Gleeson CJ, Gummow, Heydon and Crennan JJ ("the joint reasons") state clearly the issues in these appeals. I agree with most of what is said there. The appellants have undergone three trials. The first 94 Criminal Code (Q), s 7(1)(d). 95 R v Hind and Harwood (1995) 80 A Crim R 105 at 141. The test stated in Hind and Harwood was applied in subsequent cases: see R v Chan [2001] 2 Qd R 662 at 663 [3]; R v Jeffrey [2003] 2 Qd R 306 at 317; cf R v Wood (1996) 87 A Crim R 96 I accept, as stated in the reasons of Gleeson CJ, Gummow, Heydon and Crennan JJ at [20], that the trial judge probably used the words "substantial chance" rather than "substantial cause" as recorded in the transcript. 97 Mraz (1955) 93 CLR 493 at 514 per Fullagar J; Festa v The Queen (2001) 208 CLR 593 at 633 [127], 657 [212]. Kirby concluded the day after it commenced in May 2004, when the jury were discharged without returning a verdict. The second trial likewise concluded after two days in similar circumstances. It was at the third trial, heard in August and September 2004, that the proceedings came to a conclusion; that the now contested direction was given to the jury; that the jury returned verdicts of guilty of murder in respect of each of the appellants; and that each was convicted and sentenced, as required by law, to life imprisonment, the highest sentence provided in the Code. The facts are set out in the joint reasons98. On the evidence, the motivation that lay behind the desire of the second appellant (Ms Gwendoline Deemal-Hall) to have her former de facto husband ("the deceased") assaulted was not entirely clear. One suggestion, in the evidence of Mr Shannon Bowen, was that "[s]he's having a hard time. Her boyfriend's hassling her." Other evidence, that was no more than unconfirmed hearsay, hinted that she was upset because the deceased had allegedly sexually assaulted her daughter. That evidence was not admissible against Ms Deemal-Hall. It would nevertheless have been open to the jury to conclude that the reason concerned in some way the domestic relationship between Ms Deemal-Hall and the deceased. That relationship, according to the evidence, continued to some extent until the death of the deceased. Ms Deemal-Hall visited him in his motel in Mareeba on the night before his death. The circumstances that ensued after this visit were the subject of evidence given by Mr Bowen, described in the joint reasons. That evidence differed in material respects from the respective versions of events given to police by the first appellant (Mr Howard Darkan) and by the third appellant (Mr Marlow McIvor). None of the appellants gave evidence at the trial. For her part, Ms Deemal-Hall made no relevant admissions to police. There was objective evidence of very serious injuries to the deceased which had caused his death, effectively by drowning in his own blood occasioned by the severe injuries he had suffered to his face and head. It was for the jury to decide what each of the appellants had done to contribute to the deceased's death and whether such contribution was proved by the prosecution to amount to the crime of murder with which each of the appellants was charged. To the extent that the prosecution relied on the evidence of Mr Bowen, caution was required and the jury were so instructed. He was one of the three men who had assaulted the deceased. He had negotiated with the prosecution to accept a plea to a lesser offence. This resulted in a partly suspended sentence on 98 Joint reasons at [3]-[8]. Kirby the basis that he would give evidence for the prosecution against the appellants99. On the other hand, the statements to police by Messrs Darkan and McIvor, received in evidence, sought to deflect the seriousness of the parts which they had each respectively played in the assault leading to the deceased's death. Counsel for Ms Deemal-Hall sought to minimise her purpose in instigating the assault on the deceased. This endeavour was supported by reference to the statements which the male assailants alleged she had made in describing her objective. In default of sworn testimony from the appellants and with the evidence of Mr Bowen who, on his own testimony, had taken part in the assaults, the jury faced obvious difficulties in reaching factual conclusions as to the relevant conduct of each appellant, proved in accordance with the criminal standard applicable to the offences of murder that were charged. These considerations also made the task of charging the jury a difficult one. But they rendered it all the more important that the jury should receive accurate instruction concerning the ways in which the prosecution sought to demonstrate that each of the appellants was guilty of murder. This is where the importance of the directions on the Code language ("a probable consequence") becomes critical. The Code: The relevant provisions of the Code are set out in the joint reasons100. Those reasons also contain a most useful reminder of the history that lay behind the adoption of the provisions of the Code, the earlier attempts at codification in England and the eventual achievement of that objective in Queensland, other parts of Australia, and other Commonwealth countries101. I gratefully accept this exposition. It demonstrates how, in a most important respect, the process of codification took the Griffith Code102 in a direction not only different from the common law; but also different from the criminal codes adopted in other countries. At common law, to establish accessorial liability, it is necessary for the prosecution to prove that the accessory must have foreseen the principal offender's offence as a possible incident of the common unlawful enterprise103. 99 Joint reasons at [90]. 100 Joint reasons at [9]-[14]. 101 Joint reasons at [29]-[40]. 102 Named after Sir Samuel Griffith whose part in the development and adoption of the Code in Queensland was decisive: see joint reasons at [36]. 103 McAuliffe v The Queen (1995) 183 CLR 108 at 114-116; Chan Wing-Siu v The Queen [1985] AC 168 at 175. Kirby Foresight must be proved; but only to the level of a possibility. Under the Griffith Code, an objective standard is adopted. Actual foresight by the accused need not be proved. However, the "trade-off" of accepting this more stringent standard is that the prosecution must prove that what occurred was a "probable consequence" of what was undertaken, evaluated objectively104. In the versions of the codes adopted in Canada105 and in New Zealand106, the operative provisions require the establishment of even more rigorous elements involving, in each case, a variant of actual knowledge or insight and of probable consequences. Such considerations help to place the exceptional approach of the Griffith Code into the context of the laws applicable elsewhere in Australia and in other countries where statutory codifications and adaptations of the English criminal law are in force. They afford additional reasons for resisting attempts, made by the prosecution in these appeals, to sustain the assimilation of the Code provisions referring to "a probable consequence" to variations on the theme of "possibility" and "chance". In matters of basic criminal law principle, it is desirable, so far as it can properly be achieved within the statutory language, to ensure uniformity of approach throughout Australia107. Complete uniformity on the subject matter of these appeals is impossible, given the content of the common law and the different language of the Australian versions of the Code. However, the insistence on the difference between "probable" and "possible" (or "chance") is certainly a step in the right direction. Where the Code uses the word "probable" it seems unlikely, in this context, that it means "possible". So to construe the Code would not only depart from its text. It would separate even more radically the test applied in Code States from that applicable elsewhere in Australia and indeed in comparable countries overseas. The erroneous jury direction The mistaken direction: The joint reasons collect such observations in this Court as throw light on the meaning of the word "probable" appearing in the 104 See Australia, Review of Commonwealth Criminal Law, Interim Report: Principles of Criminal Responsibility and Other Matters (Sir Harry Gibbs, Chairman), (July 1990), par 16.34. 105 Criminal Code (Can), s 21(2): see joint reasons at [77]. 106 Crimes Act 1961 (NZ), s 66(2): see R v Gush [1980] 2 NZLR 92 at 93-94. 107 R v Barlow (1997) 188 CLR 1 at 32; cf Vallance v The Queen (1961) 108 CLR 56 Kirby Code108. They explain the adoption by the Court of Appeal of Queensland of the formula used by the trial judge in these proceedings to explain the contested phrase109. According to that formulation, it was enough to satisfy ss 8 and 9 of the Code, for example, "if there was a real possibility that an offence of the nature of the offence committed would be committed"110. This is how "possibility" and "chance" (qualified by use of the adjective "real") found their way into Queensland trial practice, the Queensland Bench Book and the instructions given to the jury in the present proceedings. For the reasons given by the other members of this Court, that instruction was erroneous. It did not comply with the language of the Code. Indeed, from internal evidence within the Code, where the word "likely" is quite commonly used111, it appears clear that the choice of the word "probable" was deliberate112. This conclusion is reinforced when the frequency of the general distinction between "probable" and "possible" in legal usage is recognised. It is strengthened still further by contrasting the differential usage of language in the comparable provisions of the codes of different countries, suggesting a deliberate and careful choice of words in the Griffith Code that became the model for Australian codification. It is also reinforced by a reflection on the commonsense conclusion that a decision-maker will find it somewhat more difficult to decide (to the requisite standard) that events are "a probable consequence" of propounded activities than would be the case if all that needs to be shown is that they are a "possibility" or a "chance" (including if those words are qualified by the adjective "real"). Many more consequences are possible, even really possible, than are probable113. Reaching a conclusion on possibilities and chances is easier for the mind than having to decide that something is "a probable consequence" of other people's actions and purposes. 108 Joint reasons at [42]-[55] referring to Brennan v The King (1936) 55 CLR 253; Stuart v The Queen (1974) 134 CLR 426 at 443; and Boughey v The Queen (1986) 161 CLR 10 at 19, 21-22. 109 By reference to Hind and Harwood (1995) 80 A Crim R 105 at 116-117. 110 (1995) 80 A Crim R 105 at 117 per Fitzgerald P. 111 The word "likely" is found, inter alia, in the Code, ss 1, 54A(4), 70(1), 71, 75(1)(b), 229J(1), 258(2), 268(1), 269, 270, 271(1), 302(1)(b) and (4), 306(b), 319A(a), 321A(1), 324, 326, 328A(5), 330(1), 331, 332(1), 415(4), 442D(a), 442E, 450E(6), 462(b), 467A(2), 590(2) and (3), 590AP(4), 590AQ(6) and 682(2). 112 The word "probable" is used only in ss 8, 9, 10A and 415 of the Code. 113 As an example see Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337 at 345 [7], 370 [109]; cf Boughey (1986) 161 CLR 10 at 14-15 per Gibbs CJ. Kirby The correct direction: One of the objectives of codification of the criminal law was to avoid unnecessary elaboration of the law. Such elaboration may be prone to confuse rather than to assist juries. Especially where the law has been restated in a code, so as to make a fresh start, it would ordinarily be wrong to gloss the language with notions inherited from the common law or with words that merely represent a judicial attempt, in different language, to restate Parliament's purpose114. It is not an error for a trial judge, who feels that elaboration to some extent is desirable or necessary, to afford such an elaboration115. So much may sometimes be required by jury questions. Indeed, such jury questions often focus upon key expressions, not least the standard formula of "beyond reasonable doubt"116. I would not elevate the phrase in question in this appeal to that category so that it may not be elaborated or explained117. However, there will often be good sense in simply telling the jury of the requirements of the Code, providing them with a copy of the relevant provisions (as the trial judge did here) and avoiding the use of unnecessary synonyms118. Apart from anything else, adhering to the language of the Code tends to narrow the possibility of mistakes and to reduce the length of jury instructions, which are very long in this country, by contrast, say, to jury instructions in the United States of America. Where it is decided that some elaboration of the phrase "a probable consequence" is desirable or necessary, the use of synonyms that invoke the concepts of possibility and chance, however decorated, is seriously wrong. The jury might properly be told that a probable consequence was one that was more than "merely possible"119. They might be told that it is one that they would 114 Murray v The Queen (2002) 211 CLR 193 at 218 [78.1]; Stevens v The Queen (2005) 80 ALJR 91 at 106 [64]; 222 ALR 40 at 57. See also Boughey (1986) 161 CLR 10 at 21; cf joint reasons at [67]. 115 R v Piri [1987] 1 NZLR 66 at 79. 116 On empirical studies of jurors' ability to follow judicial instructions see Zoneff v The Queen (2000) 200 CLR 234 at 261 [67]; Australian Institute of Judicial Administration, The Jury Project: Stage 1 – A Survey of Australian and New Zealand Judges, (2006) at 30. 117 See joint reasons at [69] citing Dawson v The Queen (1961) 106 CLR 1 at 18; Green v The Queen (1971) 126 CLR 28 at 31. 118 See R v Salmon & James [2003] QCA 17 at [45]. 119 Cf Boughey (1986) 161 CLR 10 at 15 per Gibbs CJ. Kirby regard as probable in the sense that it "could well have happened" as a result of carrying out the activities in question but they should not be told that it is sufficient if it is proved that what happened was a possibility or real chance or substantial risk. In all of this, I agree with what is said in the joint reasons120. The appellants have therefore made out the error for which they contended in these appeals. On the face of things, they are therefore entitled to succeed in their appeals. But their success is subject to the 'proviso'. The application of the 'proviso' Terms of the 'proviso': Given that these appeals are decided on the basis of the 'proviso', it is as well to set out the relevant provisions of the Code: "668E Determination of appeal in ordinary cases The Court on any such appeal against conviction shall allow the appeal if it is of opinion that … the judgment of the court of trial should be set aside on the ground of the wrong decision on any question of law, or that on any ground whatsoever there was a miscarriage of justice, and in any other case shall dismiss the appeal. (1A) However, the Court may, notwithstanding that it is of the opinion that the point or points raised by the appeal might be decided in favour of the appellant, dismiss the appeal if it considers that no substantial miscarriage of justice has actually occurred." The word "Court" in the section means the Court of Appeal121. In disposing of these appeals this Court is authorised, on proof of error, to substitute the order which the Court of Appeal ought to have made122. Clearly, from the foregoing, it is established that a "wrong decision on [a] question of law" occurred in the judgment of the court of trial. In the event of a wrong decision, the appellate court is then obliged ("shall") to allow the appeal. The provision for dismissal of the appeal in s 668E(1) is not enlivened. It is only enlivened in terms of s 668E(1A) if, notwithstanding the foregoing opinion, the 120 See joint reasons at [82]-[83]. 121 The Code, s 668. 122 Judiciary Act 1903 (Cth), ss 36, 37. Kirby appellate court comes affirmatively to the conclusion that no substantial miscarriage of justice has actually occurred. So is that the case here? Lack of appellate consideration: In the conclusion reached by the Court of Appeal, it was unnecessary for that Court to consider, still less apply, the 'proviso'. This was because that Court applied its own authority to the meaning of the word "probable" in the context of ss 8 and 9 of the Code, as expressed in R v Hind and Harwood123. It concluded that, in the context, "a probable consequence" was, as the trial judge had instructed the jury, a consequence that is a "substantial risk", "real chance" or "real possibility" of occurring in the prosecution of the common unlawful purpose or in fulfilment of the conduct that was "counselled"124. In this Court, the prosecution urged that comments in the Court of Appeal, addressed to the seriousness of the injuries suffered by the deceased, amounted in some way to an evaluation by that Court of the strength of the respective cases against the appellants. This submission is unsound. In the conclusion it reached, the Court of Appeal had no reason to evaluate the evidence for 'proviso' purposes. Correctly, on its premises, it omitted to do so. The respondent filed no notice of contention in this Court, seeking to support the judgment of the Court of Appeal on the basis of the application of s 668E(1A) of the Code. However, argument proceeded in these appeals on the footing that the 'proviso' was properly before us, by reason of our function. The procedural niceties may be passed by. But the invocation of the 'proviso' in this Court presents many difficulties, for reasons that I will now explain. Why the 'proviso' is inapplicable The postulate of a lawful trial: The ordinary postulate of the Australian legal system is that a person, accused of a crime, is entitled to a trial that conforms to the requirements of the law. Most especially, in the trial of serious criminal charges, the person is normally entitled to have the jury, as the "constitutional judge of fact"125, resolve contested questions of fact by the application of the applicable law correctly explained to them by the presiding judge. Not only is this a basic presumption of the criminal law in this country. It is also a fundamental principle of the international law of human rights. Thus, in 123 (1995) 80 A Crim R 105 at 141. 124 Cf [2005] QCA 206 at [61]. 125 Hocking v Bell (1945) 71 CLR 430 at 440. Kirby Art 14.2 of the International Covenant on Civil and Political Rights ("the ICCPR")126 it is provided: "Everyone charged with a criminal offence shall have the right to be presumed innocent until proved guilty according to law." (emphasis added) A legal mistake in peripheral matters, such as on non-fundamental issues of procedure, an insubstantial error in admitting this or that piece of evidence or a misdirection on a particular point of fact or law arising in the trial may not touch the fundamental requirement of having a trial "according to law"127. But where the error that is established involves a mistaken direction with respect to an essential ingredient of the offence and a misdescription to the decision-maker (here the jury) of the content of that ingredient, a real question is presented as to whether the outcome then truly answers to a trial "according to law". Clearly, the language of the 'proviso' is only enlivened when mistakes have happened. The mistakes which s 668E(1A) contemplates include, explicitly, "the wrong decision on any question of law". However, the 'proviso' is manifestly to be understood against the background of the fundamental assumption that high standards of lawfulness are observed in the conduct of criminal trials. Otherwise, such trials would not only depart from our own high conventional standards but also from the requirements of the ICCPR. Australia has ratified the ICCPR and the First Optional Protocol128. This renders the legal standards of this country examinable by the United Nations Human Rights Committee. Inevitably, this consideration brings the influence of the Covenant to bear on the exposition of the applicable Australian law129. It suggests that the "wrong decision on any question of law" to which s 668E(1) is addressed is of a particular kind – but one that does not involve fundamental errors on such questions as might deprive the trial of the character of one "according to law"130. 126 [1980] ATS 23. The Covenant entered into force on 23 March 1976. It entered into force in respect to Australia on 13 November 1980. 127 Cf Green v The Queen (1997) 191 CLR 334 at 346-347 per Brennan CJ. 128 [1991] ATS 39. The First Optional Protocol to the ICCPR entered into force on 23 March 1976. It entered into force in respect of Australia on 25 December 1991. 129 Mabo v Queensland [No 2] (1992) 175 CLR 1 at 42; Antoun v The Queen (2006) 80 ALJR 497 at 505 [37]-[38]; 224 ALR 51 at 60-61. 130 See, eg, Wilde (1988) 164 CLR 365 at 373; TKWJ v The Queen (2002) 212 CLR 124 at 148 [76]; Nudd v The Queen (2006) 80 ALJR 614 at 633 [85]; 225 ALR 161 Kirby Similar remarks, but without reference to the underpinning in human rights law, have been made several times in this Court. The appellate court, deciding the 'proviso' question, is obliged to reach its own conclusion according to the statutory criteria131. However, necessarily, it does so in the context of a legal system that observes high standards of compliance with the law; is protective against miscarriages of justice and wrongful convictions; and ordinarily applies the rigorous criterion for proof of criminal guilt, namely proof beyond reasonable doubt132. Defects of trial on the record: There are further considerations to be remembered when the 'proviso' is invoked, as it has been in these proceedings. They include, as this Court pointed out in Weiss v The Queen133, the limitations inherent in an appellate court conducting a criminal trial on the record. Here that record was taken in the court of trial where that trial, by hypothesis, has miscarried: "That task is to be undertaken in the same way an appellate court decides whether the verdict of the jury should be set aside on the ground that it is unreasonable, or cannot be supported having regard to the evidence. The appellate court must make its own independent assessment of the evidence and determine whether, making due allowance for the 'natural limitations' that exist in the case of an appellate court proceeding wholly or substantially on the record, the accused was proved beyond reasonable doubt to be guilty of the offence on which the jury returned its verdict of guilty. There will be cases, perhaps many cases, where those natural limitations require the appellate court to conclude that it cannot reach the necessary degree of satisfaction. In such a case the proviso would not apply". This passage from Weiss provides a salutary reminder both of the appellate duty in criminal appeals and of the necessary limitations within which that duty is performed. In the present proceedings, those limitations have an added feature. This arises because of the fact that, in these appeals, the intermediate appeal court did not perform the function enlivened by the 'proviso'. Effectively, therefore, what is sought by the prosecution in these appeals is a trial of the appellants, on the record, effectively for the first time applying the correct legal standard, and in this Court. In my view, at least in a case of the present 131 Weiss v The Queen (2005) 80 ALJR 444 at 454 [40]; 223 ALR 662 at 673. 132 Weiss (2005) 80 ALJR 444 at 454 [39]; 223 ALR 662 at 673. 133 (2005) 80 ALJR 444 at 454-455 [41]; 223 ALR 662 at 673-674 (footnotes omitted) (emphasis added). See also Dietrich v The Queen (1992) 177 CLR 292 at 338. Kirby kind, the final constitutional and appellate court of the nation is not well equipped to perform such a task. It is legally authorised to apply the 'proviso'134. It may do so although no notice of contention is filed relying on that provision135 and although it was not considered in the intermediate court136. But the existence of the relevant power says nothing about whether that power should be exercised. Quite apart from the fact that this Court sees no witnesses, is restricted to transcript to which it is taken by the parties with their competing interests, and has inadequate time to consider and absorb all of the evidence viewed in sequence, there are several particular disadvantages in this Court's assuming that role. Doing so represents an aggravated form of the danger, mentioned by McHugh J on several occasions, of "substituting trial by appellate court for trial In this case, this Court lacks the assistance of the intermediate court's analysis of the evidence. Assuming this function for itself, it deprives the appellants of a right to appeal against the outcome, although effectively it is the appellants' first trial "according to law"138. If we misunderstand the evidence; miscalculate the significance of the testimony of Mr Bowen; or misjudge the importance of admissible factual material in a trial that lasted six days and involved some local considerations, we become the source of a miscarriage of justice rather than the source of its correction. Final court review of evidence: In the Supreme Court of the United States there have been similar debates over the assumption by that Court of the responsibility to decide the merits of a conviction at trial where legal error in the conduct of a trial is found but it is submitted that such error is "harmless"139. In 134 Kelly v The Queen (2004) 218 CLR 216 at 238 [56]; Nicholls v The Queen (2005) 219 CLR 196 at 281 [233]. 135 Kelly (2004) 218 CLR 216 at 259 [123]-[126]. 136 Antoun (2006) 80 ALJR 497 at 506-507 [44]-[45], 507 [49], 509 [58]-[60]; 224 ALR 51 at 62-63, 65-66. 137 TKWJ (2002) 212 CLR 124 at 148 [76]; cf Nudd (2006) 80 ALJR 614 at 633 [86]; 225 ALR 161 at 184. 138 The right to appeal is also a fundamental human right: see ICCPR, Art 14.5; cf Joseph, Schultz and Castan, The International Covenant on Civil and Political Rights: Cases, Materials, and Commentary, 2nd ed (2004) at 452 [14.133]. 139 Under 28 USC §2111. Kirby United States v Lane140, Stevens J, writing in dissent but with the concurrence on this point of Brennan, Marshall and Blackmun JJ, remarked that "[u]ndertaking a harmless-error analysis is perhaps the least useful function that this Court can perform"141. In his reasons Brennan J142 explained why this was so. He said that, in the nature of the other duties and responsibilities of a final court, it was difficult to perform the "examination of the proceedings in their entirety", the course called for by United States143 as by equivalent Australian authority144. He warned against the temptation to a "perfunctory effort to evaluate the effect of this error"145 and to the substitution of intuitive judgment and impression for a thorough analysis in "one of the most complex" tasks committed to an appellate court146. This is why he concluded the Supreme Court was "manifestly ill- equipped to undertake" such a task so that, if it were to be performed at all, it should normally be remanded to the intermediate court147. Much of this analysis has direct application to a request that this Court, for the first time, apply the 'proviso'. The significance of the error: There is a further factor. I now come to why, in these appeals, the erroneous direction given to the jury by the trial judge was so serious. In my estimation, the error of substituting a verbal formula expressed in terms of possibility and chance for the language of the Code, with its reference to "a probable consequence", was factually very significant for the fair trial of the appellants. 141 474 US 438 at 476 (1986); cf United States v Hasting 461 US 499 at 516-518 (1983) (Stevens J, concurring in judgment). 142 474 US 438 at 464 (1986). 143 Kotteakos v United States 328 US 750 at 762 (1946). 144 Driscoll (1977) 137 CLR 517 at 525; Wilde (1988) 164 CLR 365 at 372; Festa (2001) 208 CLR 593 at 632 [122]. 145 474 US 438 at 464 (1986). 146 474 US 438 at 465 (1986) citing Traynor, The Riddle of Harmless Error, (1970) at 147 474 US 438 at 465 (1986). In this approach Marshall, Blackmun and Stevens JJ agreed. Kirby There were facts in the evidence that suggest that Ms Deemal-Hall's purpose in counselling the assault upon the deceased did not have murder as a probable consequence of that counselling. Equally, there is evidence which casts doubt on the proposition that a probable consequence of the prosecution of the appellants' common intention to assault the deceased was the deceased's murder. The relevant considerations available to support these propositions included: (1) Her past close personal association with the deceased manifested in her visit to him the night before his death; The fact that the deceased voluntarily went with Ms Deemal-Hall to the park where he met his fate. He travelled with her in his van. The precise reason for this conduct is unexplained. However, the inference was available that they met by agreement at Mareeba and to that extent renewed their past association; The trivial amount ($50 each) which Ms Deemal-Hall agreed to pay to the assailants was a sum that a jury might regard as apt for an assault but not as a fee for causing grievous bodily harm to the deceased, still less his death; (4) Ms Deemal-Hall's reported instructions were that the assault was to amount to a "touch-up", "getting into" or "fixing up" the deceased or giving him a "hiding"; The fact that the assault began with punches consistent with what arguably had originally been intended; The fact that the assailants did not themselves know the deceased and had no apparent reason to display personal violence or hostility towards him except to fulfil their $50 bargain with Ms Deemal-Hall; The fact that the deceased was aware of Ms Deemal-Hall's part in the assault; that she had been seen with him in the days before his death; and that he was left in a public place where he would easily and quickly be found; and The fact that there was no evidence before the attack to suggest that Ms Deemal-Hall was aware of the particular strengths of the assailants, of their propensities, of their footwear or of their possession of a pick handle or their intention to use it against the deceased. So far as the male appellants are concerned, it is necessary to decide which version of the facts is correct, if either, given that the jury were confined, essentially, to versions respectively given to police by those who had participated to some degree in the assaults (including Mr Bowen), necessitating considerable Kirby care in the evaluation of what each of them had to say, exculpating themselves and inculpating the others. Making that evaluation is quintessentially a jury function. It is a function to be performed by the application of the correct legal standard expressed in terms of probability and not possibility. For the final appellate court to perform that function for the first time is for it to assume a role that belongs properly to the appellants' jury. If one asks whether it was a possibility (even a "real possibility") that the events which Ms Deemal-Hall counselled would descend to the level of violence that they did, the answer, almost inevitably, is in the affirmative. Virtually anything is possible. Where violence gets out of hand, it is really possible. Yet it might not have been regarded as "a probable consequence" – particularly because of the considerations I have identified. At least, this was a view properly open to the jury. Similarly, with the male appellants, it all depended on whose version of events was accepted, given the imperfections of the versions that were available. It cannot be the case that the "consequence" in question is judged with the benefit of hindsight after it has occurred. To judge whether it is "a probable consequence", it is necessary to place oneself before the events unfold. This means that the actual happenings cannot decide the case in judging the probabilities prospectively. The issue is one of foresight; but it is foresight objectively and not subjectively assessed. Could it then be said that, before the attacks on the deceased unfolded, they were "a probable consequence" of the appellants' unlawful purpose? Having regard to the considerations that I have mentioned, a jury, properly instructed on the provisions of the Code, might answer that question in the negative. They might regard what happened as a series of events that got out of control and went far beyond the purposes for which the second appellant had engaged the male appellants and beyond the objects that she had counselled them to perform. The more complex the evidence, the more important it was to have the correct legal standard applied to it. I realise that, by close analysis of the record and logical reasoning, it is possible to identify ways in which the verdicts entered against the appellants might be sustained. The unedifying nature of the attack on the deceased, and the cowardly way he was left to drown in his own blood, scarcely enliven sympathy for any of the appellants. However, they have been convicted of the most serious crime in the Code. They have been sentenced to the highest punishment provided by that law148. They were entitled, in such a case, to a very high degree of accuracy in the conduct of their trials. For such serious outcomes and to sustain such extended and multiple deprivations of 148 Cf Anderson v The Queen [1972] AC 100 at 108. Kirby liberty, it is normal in our system of justice to rely on the verdicts of juries accurately instructed. Their verdicts are preferable to the logical reasoning of judges – even of the judges of the nation's final court. The jury's collective wisdom might not follow the linear logic of the justifications of the guilty verdicts found in the joint reasons149. Unknown mode of jury reasoning: This conclusion is reinforced by a reflection on the holding of this Court in Domican v The Queen150. In that case, the evidence against the accused, looked at globally and with all of its component parts, was, as in these proceedings, very powerful. However, there was a defect in the judge's instruction to the jury on one issue (identification). This Court pointed out that, in the absence of a special verdict, appellate courts are not ordinarily able to conclude how the jury reasoned to their verdict. Because the reasoning might have been affected by the defective direction (if the jury chose to reason on the basis of the evidence of identification), the verdict and the conviction that depended upon it could not stand. Verdicts that follow legal misdirection might not have been contaminated by the error. But the appellate court can never know. As in Domican, so here. If the jury in these proceedings reasoned to their verdicts by way of a conclusion that the appellants were guilty because there was a (real) possibility or chance that the death of the deceased would be a consequence of the appellants' conduct, that would render the misdirection critical. Other later rationalisations by judges, to support the verdicts on other lines of reasoning, would not then truly sustain the verdicts actually returned. The appellants would have lost their right to a jury trial according to law. That, without more, would be a miscarriage of justice of a serious kind suggesting the need for a retrial. The exceptional basis of liability: There is an additional consideration. It derives from the fact that liability under ss 8 and 9 of the Code derogates from the normal requirement of Australian criminal law that a person is only criminally responsible for the acts that he or she intends. Here, the Code language adopts an objective standard. By a legal fiction, it imposes a kind of vicarious criminal responsibility, judged by an objective standard. It does this whatever the actual intention and purpose of the accused might have been151. 149 Joint reasons at [86]-[109]. See Stevens (2005) 80 ALJR 91 at 109-110 [80]-[82]; 222 ALR 40 at 62. 150 (1992) 173 CLR 555 at 566. 151 Cf Lane 474 US 438 at 462 (1986) per Brennan J. Kirby Whilst the Code must be applied according to its terms, where those terms have been mis-stated, the exceptional character of the resulting criminal liability (and its extremely serious consequences in these proceedings) renders the mistake a very significant one. Where the mis-statement has been made with judicial authority to the decision-maker (here the jury), the potential for occasioning a miscarriage of justice is virtually inescapable. Practical and policy considerations: In addition to the foregoing reasons for requiring a retrial, there are a number of practical or policy considerations that reinforce my conclusion that it would be inappropriate to apply the 'proviso' in the present circumstances. They include: (1) Applying the 'proviso' effectively reduces this Court's extensive observations on the mis-statement of the law in Queensland (and the error of the judicial directions to the jury in the present case) to something bordering on an advisory opinion. True, it is not strictly so, for it is necessary, in applying the 'proviso', to conclude that "the point … raised by the appeal might be decided in favour of the appellant". But if it "might", that is enough. The Court is then directed to the issues of "substantial miscarriage of justice" with which the 'proviso' is concerned. In a court of error, such as this, where a serious mistake of law is revealed, there is a strong reason of principle why such mistakes should ordinarily be marked by the provision of relief and an order for a retrial. Indeed, this is the primary instruction of the Code itself ("shall allow the appeal"). The foregoing is especially so where the mistake has involved a misdescription to the jury of the ingredients of the offences charged against the appellants152. Misdirections of such a kind are more serious than others. In Nudd v The Queen153, another Queensland appeal, which concerned alleged incompetence of the appellant's legal representatives, I agreed to the application of the 'proviso', although analysis of the case, by reference to the fairness of the trial, occasioned me disquiet. In that case, however, it was found that "the trial judge instructed the jury on the applicable law with complete accuracy"154. Such was not done here. The increasing insistence of appellate courts upon the accurate explanation to 152 See KBT v The Queen (1997) 191 CLR 417 at 433-434; Krakouer v The Queen (1998) 194 CLR 202 at 216-217 [36]-[37], 227 [76]; King v The Queen (2003) 215 CLR 150 at 182 [103]; Arulthilakan v The Queen (2003) 78 ALJR 257 at 269 [61]; 203 ALR 259 at 274. 153 (2006) 80 ALJR 614; 225 ALR 161. 154 (2006) 80 ALJR 614 at 637 [110]; 225 ALR 161 at 190. Kirby juries of the central ingredients of the offence(s) charged is, in my opinion, a reason for the greater caution in the intermediate courts in the application of the 'proviso' in recent years155. Nothing said by the Court in Weiss suggests a reversal of that caution. It really speaks for itself. If the decision-maker in the trial (the jury) is misled as to its essential function and provided with an incorrect statement of the applicable legal components of the offence, the postulate of a trial according to law is not fulfilled. No amount of appellate reasoning can then replace that normal entitlement belonging to all persons accused of serious crimes156. The 'proviso' assumes that the essential postulate has been fulfilled. Here it has not been. Finally, there is a pragmatic concern. If appellate courts (and especially this Court) do not follow the finding of a basic legal error in criminal trials with the ordinary provision of relief proper to that finding, the likelihood is that appeals on such points will not be funded. They will then not be brought to a hearing. This will be so because the deemed "merits" seem likely to invite the 'proviso' and swamp the practical significance of establishing the error in question. Bringing appeals will be viewed as a waste of time, effort and resources. Important legal principles are often established in unsympathetic circumstances. Such are the circumstances here. But given the sentences the appellants were facing if convicted, the correct understanding by the jury of the considerations necessary to arrive at a guilty verdict was all the more important. Orders I would allow the appeals. I would set aside the judgment of the Court of Appeal of the Supreme Court of Queensland. In its place, I would order that the convictions of the appellants be quashed and that new trials be had. 155 R v Whittaker (1993) 68 A Crim R 476 at 484; Gilbert v The Queen (2000) 201 CLR 414 at 438 [86] per Callinan J; Doggett v The Queen (2001) 208 CLR 343 at 156 Antoun (2006) 80 ALJR 497 at 503 [23]; 224 ALR 51 at 57.

HIGH COURT OF AUSTRALIA THE CHIEF EXECUTIVE OFFICER OF CUSTOMS APPELLANT AND GRANITE ARMS PTY LTD & ANOR RESPONDENTS The Chief Executive Officer of Customs v Granite Arms Pty Ltd [2005] HCA 51 8 September 2005 ORDER Appeal allowed with costs. Set aside the orders of the Full Court of the Federal Court of Australia made on 30 March 2004 and in their place order that: the appeal to that Court be allowed with costs; the orders of the Federal Court of Australia made on 23 May 2003 be set aside and on the cross-claim, it be declared that handguns imported into Australia under cover of entry for home consumption 2E.0129.0382E are "special forfeited goods" within the meaning of the Customs Act 1901 (Cth); and the respondents pay the appellant's costs of the cross-claim. On appeal from the Federal Court of Australia Representation: C M Maxwell QC with R M Niall for the appellant (instructed by Australian Government Solicitor) B W Walker SC with M B Evans and F H Martin for the respondents (instructed by Roberts & Kuskie) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Chief Executive Officer of Customs v Granite Arms Pty Ltd Customs – Importation of handguns – Requirement in sub-item 4.1(a) of the Customs (Prohibited Imports) Regulations 1956, Sched 6, Pt 1 ("the Regulations") that the importer of a handgun has been given a statement by police authorities to the effect that the importer holds a licence or authorisation according to the law of the relevant State or Territory to possess the handgun or that such licence or authorisation is not required under the law of the relevant State or Territory – Second respondent had contracted to purchase handguns but its import permit was subsequently rescinded by the Queensland Police Service – Handguns were then consigned to first respondent in Victoria – Whether the guns were liable to condemnation as forfeited to the Crown – Whether a consignee of handguns is "the importer" of the articles for the purposes of the Regulations. Words and phrases – "importer". Customs Act 1901 (Cth), s 68. Customs (Prohibited Imports) Regulations 1956, Sched 6, Pt 1. GLEESON CJ, McHUGH, GUMMOW, CALLINAN AND HEYDON JJ. This appeal from the Full Court of the Federal Court1 turns upon construction of the provisions of the Customs (Prohibited Imports) Regulations (Cth) ("the Regulations"), read with the Customs Act 1901 (Cth) ("the Act") and applied to somewhat unusual facts. Those facts are not the subject of any significant dispute. Mr Garnet Featherstone is the principal of the first respondent ("Granite Arms") which carries on from premises in Victoria the business of trading in firearms and firearm parts. Mr Featherstone described Mr Ron Owen, the principal of the second respondent ("Omeo Way") as a trusted business friend. Omeo Way conducts a business of trading in firearms and firearm parts from premises in Queensland. Mr Owen described Mr Featherstone as a trusted business associate. On 3 January 2000 Omeo Way agreed to purchase from the Wong Long Development Co Ltd ("Wong Long"), which carried on business from an address in Beijing, China, 3000 Norinco M213 pistols. The written sales contract provided for a first shipment of 1000 pieces and a second shipment of 2000 pieces. In each case the shipment was to be from an airport in China to Brisbane. On 19 January, 8 March and 19 April respectively, Omeo Way paid for the entire order of 3000 pistols by telegraphic transfers of $US43,362, $US33,762 and $US67,452. The contract provided for the last payment to be made one week before the second shipment, that of the 2000 pieces. This case concerns that shipment. The last payment was made on 19 April and the second shipment arrived at Tullamarine Airport on 3 May. This is the critical date for the form of the legislation applicable to this case. Section 50 of the Act provides for the making of regulations which prohibit the importation of goods into Australia unless specified conditions or restrictions are complied with (s 50(2)(c)). The pistols purchased by Omeo Way were firearms within the meaning of the definition in reg 4F(4) of the Regulations, and their importation into Australia was prohibited unless the cumulative criteria of reg 4F(1) were satisfied. First, the pistols were required to be articles to which an item listed in Pt 2 of Sched 6 to the Regulations applied; this criterion was satisfied. Secondly, the importation was to be in accordance with the requirements set out in column 3 of that item. These requirements, as relevant to this case, were that the importation comply with the "Police (2004) 136 FCR 515. McHugh Callinan authorisation test" and that the pistols comply with certain safety requirements. The safety requirements were set out in item 1 of Pt 3 of Sched 6. The effect of sub-item 1.5 was that each pistol had to "comply with the requirements of sub-items 1.6 to 1.9 (inclusive), tested in accordance with arrangements approved, in writing, by the Attorney-General". It is well settled that the power conferred by s 50 of the Act may be used to assist the executive branch of government in the pursuit of policies it considers conducive to the welfare of the Commonwealth. The provision in the Regulations considered in R v Anderson; Ex parte Ipec-Air Pty Ltd2 gives a well-known example. Regulation 4F and Sched 6 were introduced in 1996 by the Customs (Prohibited Imports) Regulations (Amendment)3 and had been amended before 3 May 2000, principally in 1998 by the Customs (Prohibited Imports) Regulations (Amendment)4. The 1996 Explanatory Statement stated that the changes were designed to introduce "a new, simplified structure for the control of the importation of firearms into Australia" and continued: the Port Arthur the tragedy, "Following Australasian Police Ministers' Council (APMC) on 10 May 1996 adopted a number of resolutions aimed at effective national firearm controls." the special meeting of The 1998 Explanatory Statement referred to the agreement during 1996 by all Australian governments on a national scheme to control the circulation of firearms in Australia and stated that the amendments to the Regulations were designed the Commonwealth. regime was uniform the access throughout to ensure In the events that happened in the present case, difficulties arose in satisfaction of the testing requirements for the second shipment. But the litigated issues turn upon the operation of the "Police authorisation test". This was detailed in item 4 of Pt 1 of Sched 6 to the Regulations. (1965) 113 CLR 177. See also Murphyores Incorporated Pty Ltd v The Commonwealth (1976) 136 CLR 1. 3 SR 91 of 1996. 4 SR 52 of 1998. McHugh Callinan Item 4 made special provision for what was identified as "a category C article". The terms in which this category was identified throw light upon the subject, scope and purposes of the Police authorisation test as a whole. For a category C article "the importer" was obliged to hold the requisite certificate "that the importer is a primary producer"5. Taken apart from this context the term "importer" might be thought to identify no more than a person who brings an article into Australia from an external source, so that the term has no concern with the relationship of any person with the article once that process has ended by the passing of the article for home consumption under the Act6. However, the provisions in item 4.1 respecting category C articles show that the Police authorisation test which item 4.1 details is concerned with more than the activity of introduction of the articles into Australia. Rather, the test also looks to the subsequent character and activities of the importer. Underpinning the scheme of the Regulations in question is the concern for public safety manifested in the Explanatory Statements which are mentioned above. The Regulations thus are to be construed with regard to more than the fiscal considerations which have guided the construction of the legislation in other cases7. The Regulations imposed a requirement8 that "the importation" must comply with at least one of four "tests" set out in Pt 1 of Sched 6. The "test" critical for this case was, as noted above, the "Police authorisation test" detailed as item 4 of Pt 1. The others were the "Official purposes test", the "Specified purposes test" and the "Specified person test". The content of these tests was found in items 1, 2 and 3 of Pt 1 of Sched 6. The first and third of these items are significant. The first dealt with importation for the purposes of the government of the Commonwealth, a State or a Territory and specified retention of government ownership after importation. The third dealt with cases where "the importer" had as the principal or only occupation "the business of controlling vertebrate pest animals on rural land"9. Here, as with item 4, the "Police 5 Sub-item 4.1(b). 6 See Siemens Ltd v Schenker International (2004) 216 CLR 418 at 451-452 [95]- 7 These include Wilson v Chambers & Co Pty Ltd (1926) 38 CLR 131; R v Bull (1974) 131 CLR 203. 8 Column 3, Pt 2, Sched 6. 9 Sub-item 3.2(a), Pt 1, Sched 6. McHugh Callinan authorisation test", the prohibition imposed by reg 4F is lifted by the satisfaction of criteria which fix upon activities with respect to the goods after importation has been completed. This case turns not upon the particular provisions in sub-item 4.1(b) concerning category C articles nor upon any of the other items mentioned above, but upon the operation of par (a) of item 4.1. This is in more general terms and provides for compliance with the Police authorisation test that: "the importer of the article has been given a statement, in an approved form, to the effect that the importer holds a licence or authorisation according to the law of the relevant State or Territory to possess the article, or that a licence or authorisation to possess the article is not required under the law of the relevant State or Territory, and the statement is given by: for a State – by the Commissioner or Chief Commissioner of the police force of the State; and for the Northern Territory – the Commissioner of Police of the police force of the Northern Territory; and (iii) for a Territory other than the Northern Territory – the Chief Police Officer of the Australian Capital Territory". (emphasis added) The respondents contend, as they did successfully at trial and to a majority of the Full Court (RD Nicholson and North JJ; Kiefel J dissenting), that in the events that happened Granite Arms was "the importer" of the shipment of 2000 pistols and the Police authorisation test was satisfied because Granite Arms held a licence or authorisation "to possess" the pistols under the law of Victoria, which was "the relevant State" for item 4.1(a). The appellant ("the Chief Executive") denies that the Police authorisation test was satisfied; the use of the definite article in the phrase "the importer" identifies but the one entity (individual, partnership or corporation) among all the parties that may play a part in the introduction of imported goods into Australia, and Granite Arms was not that one designated entity. Those submissions should be accepted and the appeal allowed. We turn to explain why this is so. On 10 February 2000, a month after the date of the contract between Omeo Way and Wong Long, an officer of the Queensland Police Service issued a written confirmation that, for the purposes of reg 4F and Sched 6 to the McHugh Callinan Regulations, Mr Owen held a licence or authorisation under Queensland law to possess the 2000 pistols. A permit in respect of the first shipment of 1000 pistols had been issued on 10 January 2000. However, on 24 February 2000, the responsible officer of the Queensland Police Service wrote to Mr Owen's solicitors in part as follows: "The assertion that your client will continue to modify category H weapons by a method that is considered to be in breach of Section 7(1) of the Weapons Act 1990 [(Q)] and Sections 73(2) to (5) of the Weapons Regulation 1996 [(Q)] is of great concern to the Queensland Police Service. This is a serious matter of public interest and safety. Accordingly I have rescinded import permits number 061583 issued on 10 January 2000 and 060596 issued on 10 February 2000." Mr Owen's affidavit evidence was that Omeo Way then had to decide to where the pistols should be shipped in substitution for the destination of Brisbane stipulated in the contract with Wong Long. It was the intention of Omeo Way that "the goods were to be wholesaled to [Licensed] Dealers throughout all States of Australia". The decision was made to consign them to Granite Arms in Victoria. In that regard, Mr Featherstone's affidavit evidence with respect to the goods was: "I offered to apply for an Import Permit and Import them using my Customs Agents in Melbourne. We discussed the issues that [Omeo Way] would pay for all expenses and outgoing, with Freight On Board for Customs Clearance, Freight and such like and Mr Owen asked me if I wished to charge him a fee for being the Importer. I said that as it would not cost me anything I would do it as a favour." The last sentence is significant. There was an understanding or arrangement between two men of commerce which they then sought to implement. It is unnecessary for the decision on this appeal to classify what was arranged as a contract or the appointment of Granite Arms as the agent in a legal sense of Omeo Way. This is not an action between Omeo Way and Granite Arms for breach of contract or abuse of the position of agent10. 10 cf Keith Henry & Co Pty Ltd v Stuart Walker & Co Pty Ltd (1958) 100 CLR 342; LNC Industries Ltd v BMW (Australia) Ltd (1983) 151 CLR 575. McHugh Callinan On 3 March and 12 April respectively, written confirmation was issued by the Victorian Chief Commissioner of Police that Granite Arms was licensed or authorised for the purposes of reg 4F and Sched 6 to the Regulations to possess under the law of Victoria the consignments of 1000 and 2000 pistols. The applications to Victoria Police had been identified therein as made by Granite Arms for issue of Customs permits to import firearms. Mr Featherstone's evidence was that at no stage in the process of application was he asked by any officer of Victoria Police or of Customs whether he was the owner or would be the ultimate owner of the pistols. The shipment of 1000 pistols arrived in Melbourne on 13 March. It was moved into bond, passed the "safety test" requirements under the Regulations on 21 March, and was subsequently released and transported to Omeo Way in Queensland. As mentioned, this litigation concerns the second shipment of the remaining 2000 pistols. Wong Long had been contacted by Mr Owen. It has not been suggested that there was a novation of the sale contract. However, Wong Long was asked to consign the goods to Mr Featherstone of Granite Arms. It complied and in respect of the second shipment Wong Long issued a document headed "Tax Invoice" showing shipment to Mr Featherstone as consignee in Melbourne. An Air Waybill was issued by Korean Air Lines Co Ltd. It showed Beijing as the airport of departure and Melbourne as that of destination, and identified Granite Arms as consignee. After arrival of the second shipment at Tullamarine on 3 May 2000, FOB Customs (Vic) Pty Ltd ("FOB"), a customs broker, lodged electronically an entry for home consumption. This identified Granite Arms as "owner". Section 68 of the Act obliged "the owner" to enter the goods after the arrival at Tullamarine and "owner" was defined in s 4 as including the "consignee". Difficulties arose with safety testing of the shipment for compliance with items 1.6 and 1.9 of Pt 3 of Sched 6 to the Regulations and the place where necessary repairs of some of the pistols were to take place. Mr Owen offered unsuccessfully to give the shipment safe storage at Omeo Way's premises at Gympie until repairs had been made to the satisfaction of the Australian Federal Police. The impasse was resolved by FOB arranging for transport to and custody of the goods in bond at the premises at Altona North in Victoria of Secon Carriers Pty Ltd ("Secon"). However, on 7 September 2001, "Seizure Notices" were issued by an officer of the Australian Customs Service. These stated respectively that on McHugh Callinan 7 September at the premises of Secon 396 and 1604 pistols had been seized under s 203B(2) of the Act as goods suspected on reasonable grounds to be "special forfeited goods" because they failed to comply with reg 4F and Sched 6, Pt 1 to the Regulations. The notices were directed to Mr Owen at the Queensland address of Omeo Way. Claims for return of the two batches comprising the second shipment of 2000 pistols were made by Omeo Way as owner of the goods on 4 October. The claims were made on the ground that there was compliance with the above provisions of the Regulations. The operation of the forfeiture provisions of the Act which had been set in train in this way was summarised by Kiefel J as follows11: "Goods which are prohibited under s 50 are 'prohibited imports': s 51(1). Prohibited imports are amongst goods which are 'forfeited goods' under s 229(1)(b) and liable to be forfeited to the Crown. It is an offence for a person to import any prohibited imports: s 233(1)(b) and (1AA). Forfeited goods referred to in s 229(1)(b) are 'special forfeited goods': s 183UA. Section 203B of [the Act] provides for the seizure of goods by an authorised officer where that person reasonably suspects that goods are special forfeited goods. The owner of goods may claim their return: s 205D(2). Where a claim is made, as it was here, s 205D(2) requires the goods to be returned by the person who seized them unless one of paras (a) to (e) of s 205D(2) apply. Paragraph (e) requires their return unless proceedings are brought before a court of summary jurisdiction for a declaration that the goods are special forfeited goods and, on completion of the proceedings, a court has made an order for condemnation of the goods as forfeited to the Crown. Customs made the requisite application to the Magistrates' Court of Victoria within the time allowed. Section 205D(5) provides, by paras (b) and (c), that where proceedings of the kind referred to in s 205(2)(e) are commenced and, on completion of the proceedings, the court is satisfied that the goods are special forfeited goods, the court must declare the goods to be special forfeited goods and make an order for condemnation of the goods as forfeited to the Crown." 11 (2004) 136 FCR 515 at 518. McHugh Callinan The application for condemnation was made by the Chief Executive to the Magistrates' Court of Victoria on 11 January 2002. During the pendency of those proceedings, on 11 April, the respondents commenced proceedings in the Federal Court under the Administrative Decisions (Judicial Review) Act 1977 (Cth) for declaratory relief that the seizure of the second shipment had been unlawful. The Chief Executive cross-claimed for a declaration that the pistols are "special forfeited goods" and for their condemnation as forfeited to the Crown. The respondents pleaded that Granite Arms was importer "as agent" of Omeo Way and was at all material times entitled to possess the pistols whether on its own account or as an agent of Omeo Way. At the request of the parties the Federal Court heard and determined the cross-claim first. Spender J ordered that the cross-claim be dismissed and the Full Court dismissed the appeal of the Chief Executive. The evidence for the Chief Executive recorded an admission by the respondents that Omeo Way paid the costs, expenses and outgoings incurred in relation to the importation of the 2000 guns, and that Omeo Way had been invoiced by FOB for, and had paid, storage charges for the period before the seizure of the pistols on 7 September 2001. In oral argument in this Court counsel, who appeared for both respondents, put the case more precisely than it had been pleaded. Counsel submitted that what made Granite Arms "the importer" for the purposes of the Regulations was that it "was the consignee to whom the goods were consigned and who tried to receive [them] as consignee". Neither the Act nor the Regulations define the term "the importer". The absence of a definition of "imported" or "importation" was noted by Higgins J and Starke J in Wilson v Chambers & Co Pty Ltd12. In R v Bull13, Barwick CJ said that "in general" what was involved in importation of goods was "landing them, or bringing them within a port for the purpose of landing them in the country or place in relation to which importation is regulated". It was decided in Bull that, for the offence in s 233B(1)(b) of importation into Australia of any prohibited imports, the goods in question must have been brought within the limits of a port and that the bringing of the goods within the three mile limit of 12 (1926) 38 CLR 131 at 146, 149. 13 (1974) 131 CLR 203 at 212. McHugh Callinan the coast was not sufficient. In Wilson, one offence in issue was failure to enter imported goods as required by s 68. While the ship was in Port Kembla for bunkering the consignee of paint on board the ship sold it to the shipowner, and the paint passed into the ship's stores; later, while the ship was at Melbourne, some of the paint was used in painting the ship. It was held that the paint should have been entered by the consignee as imported goods. In both ss 233B(1)(b) and 68, "imported" and "import" are used in contexts which differ from that of reg 4F and Sched 6 to the Regulations. The subject, scope and purpose of the Regulations is the performance by the Commonwealth of its part in the creation of a national scheme of firearms control. In this context the notion of importation, and the term "the importer", look to the possession of the firearms after release for home consumption. Nor is it decisive that the width of the definition of "owner" appears to have had the result that Granite Arms as "consignee" had been obliged, by the agent FOB, to enter the second shipment for home consumption under s 68 of the Act. But it is to be noted that the seizure provisions do appear to fix upon one entity as "the owner", and in this case that was Omeo Way. The requirement in respect of seizure notices is to serve "the owner of the goods" or, in default of identification of "the owner", then "the person in whose possession or under whose control the goods were when they were seized" (s 205(1)). That latter class already would be within the definition of "owner" in s 4, if it applied to s 205(1)14. It is "the owner of the goods" who may claim their return (s 205B). Before the shipment of 2000 pistols was shipped from China to Tullamarine final payment had been made by Omeo Way and title may be taken to have passed to Omeo Way. That company directed or arranged with the seller for the particular mode of consignment to Australia. By arrangement between Omeo Way and Granite Arms all costs, charges and outgoings incurred by 14 Section 4(1) defines "Owner" in respect of goods as including a range of persons extending beyond those who are owners to those holding themselves out as such, importers, consignees, agents, and those possessed of the goods, beneficially interested in them, and having any control or power of disposition over them. The definition, which is not of "the owner", applies "except where otherwise clearly intended" (s 4(1)). McHugh Callinan Granite Arms were met by Omeo Way and storage charges for the period up to the seizure on 7 September 2001 were paid to FOB by Omeo Way. The substance of what was arranged and carried out was that Granite Arms lent its name to Omeo Way for the identification of the consignee on the Air Waybill for carriage of Omeo Way's goods to Australia. This was arranged by Omeo Way to facilitate the consummation of its purchase and the placement of the goods in Australia and at the disposition of Omeo Way. If the second shipment had been released, as had the first, the pistols would have been at the disposition of Omeo Way, not of Granite Arms. It was Omeo Way which caused the goods to be consigned to Australia by the particular means adopted. In those circumstances to reason that because Granite Arms was "the consignee" designed in the Air Waybill, it was "the importer" within the meaning of the Regulations and to the exclusion of Omeo Way is to depart the world of practical affairs. The Regulations do not require that departure. This conclusion is sufficient to require the allowance of the appeal. However, given the further arguments that were advanced by the Chief Executive as to the construction of the Regulations, something more should be said. The Police authorisation test required in this case that "the importer" hold a licence or authorisation, according to the law of "the relevant" State or Territory, "to possess" the 2000 pistols. What circumstance renders a State or Territory "relevant"? The answer must be the State or Territory in which the importer is "to possess" the articles in question. Kiefel J noted in this regard that the reference to possession appears to be derived from the use of that term across the whole range of State and Territory legislation15. Kiefel J held that "the possession" spoken of in the Police authorisation test is that of "the person who is to maintain their possession under the authority of the State or Territory in which they are to be held for some purpose referred to in the legislation of the State or Territory"16. Her Honour concluded that Granite Arms, whilst acting for Omeo Way under their arrangement with respect to importation, was not to continue to possess the pistols in Victoria after their importation. It is unnecessary to decide the appeal on that footing. The matter may be disposed of more directly. 15 (2004) 136 FCR 515 at 526. 16 (2004) 136 FCR 515 at 527. McHugh Callinan In the present case, if Omeo Way were "the importer", it had no licence, whether in Victoria or in Queensland, the two immediately apparent candidates for "the relevant" State. Granite Arms held a licence in Victoria but it was not "the importer". The evidence of a joint federal, State and Territory purpose to achieve a seamless regulatory scheme may be accepted. As this case falls out, the barrier imposed at the national frontier was not successfully breached by the stratagem adopted by Omeo Way after withdrawal of its authority under the Queensland legislation. But, in the course of argument, possible arrangements were canvassed whereby the gaps in the seamless regulatory scheme could have been exploited by the respondents with success. It is unnecessary here to say anything further on that subject. The appeal should be allowed with costs. The orders of the Full Court of the Federal Court should be set aside. In place thereof the appeal to that Court should be allowed with costs, the orders of the Federal Court set aside, and on the cross-claim it should be declared that the handguns imported into Australia under cover of entry for home consumption 2E.0129.0382E are special forfeited goods within the meaning of the Act. The Chief Executive's costs of the cross-claim should be paid by the respondents.

HIGH COURT OF AUSTRALIA Matter No A197/2003 RURAL PRESS LIMITED & ORS APPELLANTS AND AUSTRALIAN COMPETITION AND CONSUMER COMMISSION & ORS RESPONDENTS Matter No A203/2003 AUSTRALIAN COMPETITION AND CONSUMER COMMISSION AND APPELLANT RURAL PRESS LIMITED & ORS RESPONDENTS Rural Press Limited v Australian Competition and Consumer Commission Australian Competition and Consumer Commission v Rural Press Limited [2003] HCA 75 11 December 2003 A197/2003 and A203/2003 ORDER 1. Appeal No A197 of 2003 dismissed with costs. 2. Appeal No A203 of 2003 allowed. Set aside par 3 of the orders made by the Full Court of the Federal Court of Australia on 16 July 2002 as amended on 18 October 2002, and in lieu thereof, substitute the following: "3. Set aside the orders made by the Federal Court on 23 March 2001, and in lieu thereof, order that the following orders be made: (a) Declare that the First, Second and Fifth Respondents contravened section 45(2) of the Trade Practices Act by making and giving effect to an arrangement that contained provisions under which: the Fifth Respondent agreed to cease soliciting advertising and newsworthy information from the Mannum area for inclusion in its regional newspaper, the River News, and to cease promoting the sale of the River News in the Mannum area; and the First and Second Respondents agreed not to publish a regional newspaper in the Riverland area. (b) Declare that each of the Third and Fourth Respondents were knowingly concerned in or party to the First and Second Respondents' contraventions of section 45(2) of the Act as set out in sub-paragraph (a) above. (c) Declare that the Sixth Respondent was knowingly concerned in or party to the Fifth Respondent's contravention of section 45(2) of the Act as set out in sub-paragraph (a) above." On appeal from Federal Court of Australia Representation: Matter No A197/2003 F M Douglas QC with T D Blackburn and R C Scruby for the appellants (instructed by Blake Dawson Waldron) N J Young QC with M H O'Bryan for the first respondent (instructed by Australian Government Solicitor) No appearance for the second and third respondents Matter No A203/2003 N J Young QC with M H O'Bryan for the appellant (instructed by Australian Government Solicitor) F M Douglas QC with T D Blackburn and R C Scruby for the first to fourth respondents (instructed by Blake Dawson Waldron) No appearance for the fifth and sixth respondents Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Rural Press Limited v Australian Competition and Consumer Commission Australian Competition and Consumer Commission v Rural Press Limited Trade practices – Exclusionary provisions – Arrangement between regional newspaper publishers providing that one would withdraw newspaper services from the prime circulation area of the other – Whether provision had purpose of preventing, restricting or limiting supply of services to, or acquisition of services from, particular persons or classes of persons – Trade Practices Act 1974 (Cth), ss 4D, 45(2)(a)(i), 45(2)(b)(i). Trade practices – Where regional newspaper publisher threatened to circulate new newspaper in prime circulation area of a second regional newspaper publisher, unless second publisher ceased circulation of its own newspaper in first publisher's prime circulation area – Where second publisher subsequently ceased circulation of newspaper in first publisher's prime circulation area – Whether an "arrangement" – Whether arrangement had purpose or effect of substantially lessening competition – Trade Practices Act 1974 (Cth), ss 45(2)(a)(ii), 45(2)(b)(ii). Trade practices – Accessorial liability – Whether officers of newspaper publisher were "involved in" publisher's contraventions – Whether officers participated in or assented to contraventions with actual knowledge of essential elements constituting the contraventions – Trade Practices Act 1974 (Cth), ss 75B(1), Trade practices – Misuse of market power – Whether publisher took advantage of market power in its prime circulation area in threatening to enter prime circulation area of second publisher – Trade Practices Act 1974 (Cth), s 46(1). Practice and procedure – Orders – Form of declarations. Words and phrases – "arrangement", "involved in", "take advantage of", "purpose", "particular persons or classes of persons". Trade Practices Act 1974 (Cth), ss 4D, 45(2)(a)(i), 45(2)(a)(ii), 45(2)(b)(i), 45(2)(b)(ii), 46(1), 75B(1), 76(1), 80(1). GLEESON CJ AND CALLINAN J. The facts, and the issues, in these appeals are set out in the reasons for judgment of Gummow, Hayne and Heydon JJ ("the joint reasons"). We agree with the orders they propose. As to the issues in relation to ss 45(2)(a)(ii), 45(2)(b)(ii), and 46 of the Trade Practices Act 1974 (Cth) ("the Act"), accessorial liability, penalties, and the form of orders, we agree with the joint reasons, and have nothing to add. As to the issues in relation to ss 4D, 45(2)(a)(i) and 45(2)(b)(i), we agree with the joint reasons given for allowing the appeal of the Australian Competition and Consumer Commission ("the ACCC") against the decision of the Full Court of the Federal Court1. However, we wish to add some brief observations, not because they determine the outcome of the present case, but because of the wider implications of some of the propositions advanced in argument. The legislative history of s 4D is set out in the reasons of the Full Court2. That history is significant in the light of s 15AB of the Acts Interpretation Act 1901 (Cth). After the decision of the Full Court, this Court dealt with certain aspects of s 4D, and ss 45(2)(a)(i) and 45(2)(b)(i), in News Ltd v South Sydney District Rugby League Football Club Ltd3. In applying s 4D, courts have had to consider the statutory concept of a provision (of a contract, arrangement or understanding) which has the purpose of preventing, restricting or limiting supply to or acquisition from particular persons or classes of persons. This is a compound concept involving a certain kind of purpose, having as its object particular persons or classes of persons4. The particularity of the persons or classes of persons who are the objects of the purpose as defined and proscribed is essential to the concept of an exclusionary provision5. The significance of a finding that a provision is an exclusionary provision within s 4D and ss 45(2)(a)(i) and 45(2)(b)(i) is that such a finding engages a per se legislative prohibition. It becomes unnecessary to consider 1 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236. (2002) 118 FCR 236 at 260-263 [86]-[96]. (2003) 77 ALJR 1515; 200 ALR 157. (2003) 77 ALJR 1515 at 1519-1520 [17], 1528 [68], 1530 [79]; 200 ALR 157 at (2003) 77 ALJR 1515 at 1520 [20]; 200 ALR 157 at 163. Callinan whether it has the purpose or effect of substantially lessening competition in a market. If attention were not paid to the compound nature of an exclusionary provision, and the requirement of particularity of its object or objects, there is a danger that s 4D would be given an operation that would greatly reduce the statutory significance of lessening competition, in relation to agreements between competitors generally. Contracts, arrangements or understandings between competitors commonly involve some form of prevention, restriction or limitation of supply or acquisition of goods or services. If two hairdressers in a suburban main street were to have an understanding that one would provide services to men, and one would provide services to women, it may be unlikely that their understanding would involve a substantial lessening of competition in a market. It would be surprising if it were held, nevertheless, to contravene the Act. To the extent to which it had an anti-competitive purpose, that purpose would not be "directed toward"6 particular persons or classes of persons. In the past, judges have sought to elucidate the meaning of this concept by examining the legislative history. That process of construction is legitimate, provided it is not taken too far. The paradigm case, singled out for the purpose of parliamentary consideration, was that of a boycott. This has sometimes led to the treatment of the paradigm as if it were the only case to which the legislation applies. It has also driven courts to the unproductive and inappropriate task of seeking to construe the parliamentary materials and speeches rather than the statute. The precise meaning of boycott itself is far from clear. The emphasis placed upon boycotts in the development and explanation of the legislation reinforces the importance of the compound nature of the concept, and the necessity for particularity of objects, and to that extent it is useful in construing the legislation. But it cannot be permitted to divert attention from the text. We agree with Gummow, Hayne and Heydon JJ that there was sufficient particularity in the present case, but we can think of other cases in which it would be absent, notwithstanding the existence of a purpose of preventing, restricting, or limiting supply or acquisition. If it were not so, the references to particular persons or classes of persons would be redundant. The Full Court referred to the changes that have taken place in the form of s 4D. In its original form, the proscribed purpose was of preventing, restricting or limiting supply to or acquisition from particular persons. The words "or classes of persons" were added in 1986, following some decisions that were thought to reveal an undue narrowness in the legislation in its original form. Those words were clearly intended to widen the provision, but not to change its (2003) 77 ALJR 1515 at 1530 [79]; 200 ALR 157 at 177. Callinan entire character. The proscribed purpose must still be one that is directed toward particular persons or classes of persons. Parliament did not delete the word "particular" and substitute the word "any". Nor did it remove all reference to persons as objects of the proscribed purpose. The legislative history, as well as the text, tends strongly against a reading of the section which requires only that a provision of a contract, arrangement or understanding has the purpose of preventing, restricting or limiting, in any way, supply or acquisition. Supply or acquisition will always be to or from persons. Ordinary principles of construction require that the references to particular persons or classes of persons be given work to do; they are not mere drafting verbosity. A court construing a provision in an Act "must strive to give meaning to every word of the provision"7. A court will seek to avoid a construction of a statute that renders some of its language otiose. Here, that consideration is powerfully reinforced by the legislative history, which shows that the reference to particular persons was originally an essential feature of s 4D, and that the addition of the reference to classes was intended to expand it, not to make it superfluous. In argument in the Full Court in the present case, the ACCC itself appears to have given some encouragement to what was identified in News Ltd v South Sydney District Rugby League Football Club Ltd as an error of approach. The joint judgment of the Full Court records the following8: "[Counsel for the ACCC] accepted in principle that s 4D can properly be described as a primary boycott provision, and that breach of it requires that there be a target aimed at by the provision. He submitted, however, that the section should not be read down on this account, but must be given full effect according to its terms. If that is done, so he argued, the class identified by the primary judge could be said to be the target of a boycott." In the light of that argument, it is perhaps not surprising that the Full Court approached this aspect of the case as it did. A danger in treating s 4D as concerned only with boycotts is that it fosters an assumption that the section applies only when there is some form of animus towards the object or objects of an exclusion. In the present case, the Full Court concluded9: 7 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at (2002) 118 FCR 236 at 263 [97]. (2002) 118 FCR 236 at 265 [103]. Callinan "There is no reason to suppose that either party should have had any purpose to injure or disadvantage [readers or advertisers in the nominated geographic area]." Section 4D does not require such a purpose, although it may sometimes exist. An exclusionary provision may be directed toward particular persons or classes of persons without necessarily having a purpose of injuring or disadvantaging them. However, a purpose of the kind defined and proscribed must exist, and must be directed toward particular persons or classes of persons, for the legislative prohibition to apply. GUMMOW, HAYNE AND HEYDON JJ. After a trial of proceedings brought by the Australian Competition and Consumer Commission ("the Commission"), the Federal Court of Australia made declarations and orders against the surviving respondents in relation to contraventions of the Trade Practices Act 1974 (Cth) ("the Act"). It found10 that the corporate respondents had made an arrangement which contravened s 4511 in two ways. It contained provisions having the purpose and effect of substantially lessening competition in a market and it contained an exclusionary provision (as defined in s 4D)12. The Federal Court 10 Australian Competition and Consumer Commission v Rural Press Ltd (2001) ATPR ¶41-804 (Mansfield J). 11 Section 45 provides in part: "(2) A corporation shall not: make a contract or arrangement, or arrive at an understanding, if: the proposed contract, arrangement or understanding contains an exclusionary provision; or a provision of the proposed contract, arrangement or understanding has the purpose, or would have or be likely to have the effect, of substantially lessening competition; or give effect to a provision of a contract, arrangement or understanding … if that provision: is an exclusionary provision; or has the purpose, or has or is likely to have the effect, of substantially lessening competition." 12 Section 4D provides: "(1) A provision of a contract, arrangement or understanding, or of a proposed contract, arrangement or understanding, shall be taken to be an exclusionary provision for the purposes of this Act if: the contract or arrangement was made, or the understanding was arrived at … between persons any 2 or more of whom are competitive with each other; and the provision has the purpose of preventing, restricting or limiting: (Footnote continues on next page) also found a contravention of s 4613. And it found that certain executives were knowingly concerned in these contraventions. The Full Court of the Federal Court of Australia allowed an appeal brought by Rural Press Ltd ("Rural Press"), Bridge Printing Office Pty Ltd ("Bridge"), Trevor McAuliffe ("McAuliffe") and Ian Law ("Law") ("the Rural Press parties") but only so far as it related to exclusionary provisions and s 46. It dismissed an appeal and cross-appeal by the Commission in relation to penalty14. Two appeals have been brought from those orders. The Rural Press parties take three points: that there was insufficient evidence to find an arrangement, that there was no purpose or effect of substantially lessening competition, and that McAuliffe and Law had insufficient knowledge to make them liable for ancillary contraventions. The Commission appeal contends that the Full Federal Court should have found that s 46 was contravened and should have found that the arrangement contained an exclusionary provision. the supply of goods or services to, or the acquisition of goods or services from, particular persons or classes of persons; or the supply of goods or services to, or the acquisition of goods or services from, particular persons or classes of persons in particular circumstances or on particular conditions; by all or any of the parties to the contract, arrangement or understanding 13 Section 46(1) provides: "(1) A corporation that has a substantial degree of power in a market shall not take advantage of that power for the purpose of: eliminating or substantially damaging a competitor of the corporation or of a body corporate that is related to the corporation in that or any other market; (b) … or deterring or preventing a person from engaging in competitive conduct in that or any other market." 14 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 (Whitlam, Sackville and Gyles JJ). The facts The pre July 1997 position: the Standard's monopoly. Rural Press was a publisher of regional newspapers in many parts of Australia. One of its wholly- owned subsidiaries, Bridge, published a regional newspaper called the Murray Valley Standard ("the Standard"). It was published in Murray Bridge (a township of about 13,000 population one hour's drive east of Adelaide on the River Murray). It was sold on Tuesdays and Thursdays at a price of ninety cents. On Tuesdays its circulation was about 4,000-4,500; on Thursdays it was 4,500 or perhaps more. It circulated in, published news and advertising about, and solicited advertising from, the Murray Bridge district. Within the prime circulation area of the Standard was the township of Mannum (of about 3,000 population, located thirty kilometres north of Murray Bridge), together with the townships of Sedan, Cambrai and Palmer, and smaller rural settlements. There were regional newspapers published in areas adjacent to the Murray Bridge district – the Leader, the River News, the Southern Argus, the Times and the Courier. But until July 1997 few copies of those other regional newspapers were sold in the Murray Bridge district. Further up the River Murray from Mannum was the Riverland area. In it was Waikerie (a township of about 1,800 population) where Waikerie Printing House Pty Ltd ("Waikerie Printing") published a regional newspaper, the River News. It was sold weekly on Wednesdays at a price of sixty cents. It had a circulation of 2,000-2,500 copies. Before July 1997 it circulated around Waikerie, west to Morgan and south to Nildottie and Swan Reach — about halfway between Murray Bridge and Waikerie. It sold a few copies in Cambrai, Sedan and Mannum, but Mannum was not regarded as part of its prime circulation area. Still further up the River Murray were Loxton and Renmark. At Loxton, Loxton News Pty Ltd published another small regional newspaper, the Loxton News, and at Renmark, Murray Pioneer Pty Ltd published the Murray Pioneer. Paul Taylor and Darnley Taylor were directors and controllers of Waikerie Printing, Loxton News Pty Ltd and Murray Pioneer Pty Ltd. John Pick ("Pick") was Managing Editor of the River News, made most day-to-day decisions about it, and was also a director of Waikerie Printing. The River News was printed under arrangement with Murray Pioneer Pty Ltd, which operated a printing press at Renmark. The events of and following 1 July 1997: the River News expands south. On 1 July 1997 the structure of Councils in the area changed. A new Council called the Mid Murray Council was established. Its northern and central areas were in the prime circulation area of the River News; but it extended into the Mannum area, part of the prime circulation area of the Standard. The new Council area was serviced by the Standard in the south, the River News in its northern and central parts, and the Leader (published in the Barossa Valley) in the central and eastern parts. Pick conceived the idea of causing the River News, which aimed to publish local government notices and advertisements for the Mid Murray Council, to circulate not only in the northern and central parts of the Mid Murray Council area, but also in its southern part around Mannum. This would make the River News a competitor with the Standard for readers and advertisers in the part of the Standard's prime circulation area which was around Mannum. Acting within his authority, but without notice to the Taylors or to the Rural Press parties, Pick put in place arrangements to procure news and advertisements from advertisers in the Mannum area and small towns to the north. He appointed casual local correspondents in those towns. He engaged Duncan Emmins ("Emmins") to procure news and advertising – from September 1997 to January 1998 on a piecework basis, from January 1998 on what was described as "a permanent part time basis at twelve hours per week." He publicised Emmins' appointment. In late June or early July 1997 Pick delivered to all households in Mannum two free successive editions of the River News. Mannum residents were told that the River News would be available at the Mannum newsagency or on order. From July 1997, the River News expanded in size by four pages per issue in order to publish its articles about the Mannum area. The result of introducing this competition into the Mannum area was that the circulation of the River News in that area increased by between one hundred and five hundred copies. The reaction of the Rural Press parties to new competition in the Mannum area. Beryl Price ("Price") was Manager of Bridge. She reported to McAuliffe, Regional Manager of Rural Press for South Australia. He in turn reported to Greg Watson ("Watson"), General Manager for Special Projects of Rural Press until December 1997, and thereafter to Law, General Manager of the Regional Publishing Division of Rural Press. Watson and Law reported to Brian McCarthy ("McCarthy"), Managing Director of Rural Press. From July 1997 these executives began to worry about the move of the River News into the Mannum area. As early as 1 August 1997 Price recommended distributing a free regional newspaper throughout the Riverland area, and she repeated that proposal on at least 21 November 1997, 24 December 1997 and 3 February 1998. She badgered her superiors for action and taunted them about their pusillanimity, urging them to show that "we are serious", asking if "we" are "serious about our threat to enter the Riverland market", saying that "We are looking like wimps" and warning of the ineffectiveness of being "nice". She and her superiors repeatedly indicated to the Taylors and to Pick that unless Waikerie Printing reversed the move of the River News south, Rural Press would have to consider reacting commercially, perhaps by establishing a rival newspaper in the Riverland area. They did so by conversations in July 1997 (between Price and Pick), on 29 July 1997 (between McAuliffe and Pick), in November 1997 (between Watson and Paul Taylor), in late January 1998 (between Law and Darnley Taylor), on about 30 January 1998 (between McAuliffe and Paul Taylor), on 3 March 1998 (between Law and Paul Taylor) and on 3 April 1998 (between Law and Anthony Robinson, Managing Director of Leader Newspapers Pty Ltd, the publisher of the Leader). They also did so by a letter of 20 March 1998 from Rural Press to Paul Taylor. They kept each other informed about these communications and the reactions of the Taylors to them. McAuliffe and Law were each aware of the general financial strength of Rural Press and of its relationship with Bridge; of the general market in which the Standard competed; of the physical resources available to Rural Press and to Bridge if it were desired to embark upon publishing a regional newspaper in the Riverland area; of the fact that the activities of the River News in the Mannum area were in competition with those of the Standard; and of the fact that the Taylors would have perceived that they were being threatened with a new regional newspaper in the Riverland area which would potentially reduce the profitability of their businesses there greatly. McAuliffe and Law each intended to procure a cessation in the provision by the River News of services in the Mannum area, the quid pro quo being that the Rural Press parties would not establish a Riverland newspaper in rivalry to those of the Taylors15. As a result of the communications up to and including 3 March 1998, on that day Paul Taylor gave a "mild assurance" to Law about gradually withdrawing from Mannum within a month. Perhaps because Pick was not enthusiastic to do this, a further threat on 3 April 1998 was issued. The Taylors thereafter decided to withdraw because the officers of the Rural Press parties had told them that if they did not withdraw, a new newspaper in the Riverland area would be started, and if they did withdraw, it would not be. On 9 April 1998 Paul Taylor told McAuliffe that the River News would revert to a line forty terminated Emmins' engagement, ceased to promote the paper in the Mannum area, ceased its focus Waikerie Printing 15 Australian Competition and Consumer Commission v Rural Press Ltd (2001) ATPR ¶41-804 at 42,743-42,744 [138]-[140]. on Mannum news, ceased to seek advertising revenue in Mannum, and caused the paper to revert to its previous prime circulation area, which stopped about forty kilometres north of Mannum. A significant fall in circulation in the Mannum area resulted. Rural Press took no steps towards establishing a newspaper in the Riverland area thereafter. The Rural Press parties' appeal to this Court: background The trial judge found that there was "a market in the Murray Bridge area for the supply of regional newspapers such as the Standard, which provide the services of providing information news and advertising to persons within that area."16 The Full Federal Court rejected an attack on that finding17, and it was not renewed in this Court. The Commission alleged that in March-April 1998 an arrangement was made by which Waikerie Printing committed itself to withdraw the River News from circulation in the Mannum area and Rural Press and Bridge committed themselves not to pursue the introduction into the Riverland area of any new newspapers in competition with the newspapers published by the Taylors18. The trial judge upheld those allegations19. He found that the making of that arrangement contravened s 45(2)(a)(ii), and that effect had been given to it contrary to s 45(2)(b)(ii)20. The Full Federal Court agreed21. 16 Australian Competition and Consumer Commission v Rural Press Ltd (2001) ATPR ¶41-804 at 42,738 [109]. 17 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at 268-272 [109]-[121]. 18 Australian Competition and Consumer Commission v Rural Press Ltd (2001) ATPR ¶41-804 at 42,729 [75]. 19 Australian Competition and Consumer Commission v Rural Press Ltd (2001) ATPR ¶41-804 at 42,733 [90]. 20 Australian Competition and Consumer Commission v Rural Press Ltd (2001) ATPR ¶41-804 at 42,738-42,739 [115]-[116], 42,744 [143]. 21 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at 259-260 [84], 275 [133]. The first Rural Press complaint: was there an arrangement? The Rural Press parties contended that the Commission's case was based on reciprocity of commitment, and that it failed because there was no evidence or finding that, in consideration for the River News being withdrawn from Mannum, the Rural Press parties would not publish a newspaper in Waikerie rivalling the River News. Rather, they contended that Waikerie Printing had decided to withdraw unilaterally "in the face of a perceived commercial threat without any arrangement having been reached." This characterisation by the Rural Press parties of the relevant events, which was rejected in both courts below, concentrates on a very narrow segment of the evidence. It cannot survive examination of the much greater range of evidence analysed by the courts below. Since their decisions are reported, it is not necessary to repeat that analysis. On the facts as summarised above a conclusion that an arrangement had been arrived at was inevitable. The Rural Press parties' submission that there was no finding that in consideration for the River News being withdrawn from Mannum, the Rural Press parties would not publish a newspaper in the Riverland area pays no attention to those facts. It also pays no attention to the trial judge's finding that the parties had a shared purpose "to secure the withdrawal of the River News from the Mannum area in exchange for the understanding that Rural Press and Bridge would not initiate the publication of a regional newspaper in the Riverland area."22 And it pays no attention to the trial judge's use of the words "quid pro quo" to describe the Rural Press parties' promise not to set up a rival Riverland paper if the River News was withdrawn23. In truth, the courts below did indeed make the findings which, the submission contended, were lacking. The Rural Press parties argued that the existence of an arrangement was negated by the following incident. On or about 7 April 1998, Law composed the following letter to Paul Taylor: "The attached copies of pages from The River News were sent to me last week. The Mannum advertising was again evident, which 22 Australian Competition and Consumer Commission v Rural Press Ltd (2001) ATPR ¶41-804 at 42,738 [111]. 23 Australian Competition and Consumer Commission v Rural Press Ltd (2001) ATPR ¶41-804 at 42,744 [140]. suggests your Waikerie operator, John Pick, is still not focussing on the traditional area of operations. I wanted to formally record my desire to reach an understanding with your family in terms of where each of us focuses our publishing efforts. If you continue to attack in Mannum, a prime readership area of the Murray Valley Standard, it may be we will have to look at expanding our operations into areas that we have not traditionally services [sic]. thought I would write there could be no misunderstanding our position. I will not bother you again on this subject." to you so The attached pages revealed at least seven Mannum-sourced advertisements and an article by Emmins on the opening of Mannum Hardware as a Thrifty-Link Hardware store. The letter was typed on Rural Press letterhead. It was signed by Law as "General Manager". He retained that document, but sent an unsigned copy to McCarthy with the message: "We are holding original in case you wish to make an amendment. Will post Thursday." The document was dated 9 April 1998, which was a Thursday. McCarthy amended the letter so as to read: "The attached copies of pages from The River News were sent to me last week. The Mannum advertising was again evident, which suggests your Waikerie operator, John Pick, is still active in the Mannum market. This is of ongoing concern to me, as Mannum is a prime readership area of the Murray Valley Standard. It could well be that we need to review our current publishing strategies in view of the changed market position. thought I would write there could be no misunderstanding of our position. I will not bother you again on this subject." to you so McCarthy also wrote the following perceptive note to Law on the amended document: "I am concerned about any TPC implications in what's written." Though McCarthy's language was more veiled than Law's, it still had plenty of "TPC implications" adverse to the legality of the Rural Press parties' conduct. Neither letter was sent, but the trial judge found that the letter drafted by Law represented his state of mind at the time24. The argument that there was no arrangement because of McCarthy's fears about there being trade practices implications in the letter which Law wanted to send fails. All the material communications had taken place before 9 April 1998, apart from the final communication of assent from the Taylors on 9 April 1998. None of these earlier communications was withdrawn. And in any event, the draft letters were probative of a desire that the parties reach an arrangement of the kind alleged. The Rural Press parties' final submission was that after April 1998 the River News continued to circulate in the Mannum area. That submission ignores the trial judge's findings about how radically attenuated its posture there had become. The second Rural Press complaint: was there a purpose or effect of substantially lessening competition? Rural Press parties' contentions. In this Court the Rural Press parties attacked the concurrent findings of the courts below25 that there had been a substantial lessening of competition in four ways. First, the Rural Press parties stressed the small scale of the trade involved. The incursion by the River News was for a trial period of twelve months only. Waikerie Printing had no intention of further extending the prime circulation area of the River News. It was customary for publishers of regional newspapers in South Australia generally to circulate their newspapers within well-defined geographical areas, because it was highly unlikely that a second regional newspaper could survive in those areas. The circulation numbers, readership and areas of circulation were very small. The incursion involved increased production costs of $15,333 and increased total revenue of less than $20,000, producing, even after adjusting the costs in various respects, profits of only 24 Australian Competition and Consumer Commission v Rural Press Ltd (2001) ATPR ¶41-804 at 42,731 [84]. 25 See in particular the trial judge: Australian Competition and Consumer Commission v Rural Press Ltd (2001) ATPR ¶41-804 at 42,738-42,739 [114]- Secondly, the Rural Press parties contended that it was misleading to speak of the River News being "withdrawn" from Mannum once the arrangement was put into effect. Though Emmins was no longer promoting circulation and advertising in the Mannum area or writing stories about the Mannum area, the paper continued to circulate in Mannum and its neighbouring towns, and Mannum residents could advertise in it. It continued to sponsor significant local events. Its advertising revenue did not fall substantially. The third contention of the Rural Press parties was that there was no realistic proposal of the River News offering a potentiality of competition. The Rural Press parties could legitimately have started a competitive publication in the prime circulation area of the River News. If the threat of this stopped competition from the River News in the Mannum area, it is unlikely that the incursion would have lasted long in any event. The fourth criticism advanced by the Rural Press parties was that the courts below had failed to have regard to the extent of competition in the regional newspaper market from "local radio, regional television and statewide newspaper and television services provided in other markets." Conclusions on competition. The relevant questions in this case are whether the effect of the arrangement was substantial in the sense of being meaningful or relevant to the competitive process, and whether the purpose of the arrangement was to achieve an effect of that kind26. 26 Stirling Harbour Services Pty Ltd v Bunbury Port Authority (2000) ATPR ¶41-752 at 40,732 [114]; Australian Competition and Consumer Commission v Australian Medical Association Western Australia Branch Inc (2003) 199 ALR 423 at 483 [329]. The test set out in these cases was advocated by the Commission and not disputed by the Rural Press parties. In the Stirling case French J referred to three authorities. In Tillmanns Butcheries Pty Ltd v Australasian Meat Industry Employees' Union (1979) 27 ALR 367 at 382 Deane J said he inclined to the view that "substantial loss or damage" as used in s 45D(1) meant "real or of substance and not insubstantial or nominal." In Radio 2UE Sydney Pty Ltd v Stereo FM Pty Ltd (1982) 44 ALR 557 at 564 Lockhart J said that in s 45(2) "the lessening of competition must be at least real or of substance", and said that he saw "considerable force in the view … that, in the context of s 45, the word means substantially in the sense of considerably." In Eastern Express Pty Ltd v General Newspapers Pty Ltd (1991) 30 FCR 385 at 420-422 Wilcox J rejected the view that an effect on competition which was more than insignificant was for that reason alone substantial. While the Commission favoured the less demanding of these tests and the Rural Press parties the more demanding, it is not necessary to decide between them in order to determine this appeal. What is plain is that those (Footnote continues on next page) The impact of local radio, regional and statewide television and statewide newspaper services must be left out of account. The trial judge was asked to include at least some of those services within the market. His finding of market definition excluded all of those services. That finding is not the subject of a ground of appeal. The contention that the courts below wrongly failed to take account of those services in assessing competition is either a contradiction in terms or an impermissible attempt to challenge the market found by the courts below without making the challenge directly as a ground of appeal. It is not decisive that the River News only circulated in part of the Murray Bridge regional newspaper market, or that the overall trading activities of participants in the Murray Bridge regional newspaper market were not extensive. Section 50(6) of the Act in its then form provided that in s 50 "market" meant a "substantial" market for goods or services in Australia, a State or a Territory of Australia. There is no equivalent provision in s 45. While neither the area nor the increases in sales, advertising revenues and profits achieved were large, it does not follow that the River News did not achieve a substantially pro-competitive impact by its move south or that the arrangement did not have a substantially anti-competitive impact in causing its retreat north. The move was profitable. There was no reason to suppose that it would not remain profitable or that Waikerie Printing would not seek to continue gaining those profits. The trial judge found that but for the arrangement Pick would have continued to publish the River News in the Mannum area. The success of Pick's experiment invalidates the Rural Press parties' argument that regional newspaper markets in South Australia must inevitably be single firm markets. The fact that the River News continued to be available after April 1998 does not mean that competition was not substantially lessened: the Rural Press parties have not successfully challenged the findings of the trial judge that from April 1998 it ceased to promote circulation or seek advertising revenue in Mannum, and that its circulation dropped "very significantly"27. The Rural Press parties did not answer a fundamental question. If they had not seen the competitive impact of the River News as actually or potentially authorities do not support the proposition that it would be sufficient for liability if the relevant effect was quantitatively more than insignificant or not insubstantial. That proposition does not follow from the test stated by French J. 27 Australian Competition and Consumer Commission v Rural Press Ltd (2001) ATPR ¶41-804 at 42,726 [62]. substantial, why did they fear it? They paid extremely close attention to the new activities of the River News, they recorded them, they communicated about them orally and in writing and they exhibited adamantine opposition to them. In itself that can be the conduct of a bona fide competitor, and in limited respects the Rural Press parties did respond competitively, but they coupled this with much conduct which was not bona fide competition on the merits. Price pressed her superiors incessantly about the problem from July 1997. McAuliffe, her immediate superior, paid equally close attention to the problem, and kept his superiors, Watson and Law, informed. All four executives made threats to Waikerie Printing directors to retaliate in the Riverland areas. Even McCarthy, the Managing Director of Rural Press, felt it necessary to give the matter personal attention. That is significant. Rural Press was a national company publishing itself, or through its subsidiaries, 30 agricultural magazines and 147 regional newspapers throughout Australia. It had interests in New Zealand and the United States of America. It had sales in 1999-2000 of $438 million and a pre-tax profit of $99 million. It had net assets of $410 million as at 30 June 2000. The managing director of so large a company must have had heavy burdens and clamant demands on his time. The role McCarthy played must negate any suggestion that the advance of the River News was insignificant or that the competitive impact of its retreat was merely trivial. Though he rightly saw problems under the Act, he did not inquire into or disavow what had been happening. He was apparently content to let his subordinates solve the problem by forcing the River News to contract its activities. The views and practices of those within an industry can often be most instructive not only on the question of achieving a realistic definition of the market28, but also on the question of assessing the quality of particular competitive conduct in relation to the level of competition and the impact of its cessation. What Pick had done cannot be ignored. He saw a new commercial opportunity arising out of the change in Council areas. He exploited that commercial opportunity in the manner described above. The lower advertising rates offered had the effect of causing at least one substantial advertiser to move from the Standard to the River News. That the market had not been competitive before, but had become competitive, is suggested partly by the success of these measures, partly by the competitive response of the Standard (for example, publishing two new pages of Mannum community news and appointing an advertising canvasser in Mannum), and partly by the fact that the officers of the Rural Press parties decided to try to force the River News back into its traditional area in order to restore monopoly conditions in the Murray Bridge regional 28 Boral Besser Masonry Ltd v Australian Competition and Consumer Commission (2003) 77 ALJR 623 at 662-663 [257] per McHugh J; 195 ALR 609 at 662. newspaper market. What Pick did was to compete – to respond to a sudden change in the commercial environment by introducing rivalrous conduct into a part of a market that had previously not known it. His capacity, energy and determination caused the River News, at least in that part of the market, to become a small but potentially significant competitor. The presence of even one competitor of that kind tended to dilute the impact of the existing monopoly. The arrangement between the monopolist and Pick's employer almost totally negated the beneficial effects of Pick's competitive behaviour over the previous nine months – a choice for readers and advertisers where before there was none, a wider range of news in the Standard and lower advertising rates. That is why the arrangement had the purpose and effect of substantially lessening competition in the Murray Bridge regional newspaper market. The third Rural Press complaint: were McAuliffe and Law accessories? The trial judge held that McAuliffe and Law were "involved in" the contraventions established against Rural Press and Bridge within the meaning of s 75B(1) of the Act29. The trial judge rightly held that it was necessary to find that McAuliffe and Law participated in, or assented to, the companies' contraventions with actual knowledge of the essential elements constituting the contraventions. The Rural Press parties complained that he failed to make particular findings, but they are in fact inherent in his reasoning. In the end the argument was only that McAuliffe and Law "did not know that the principal's conduct was engaged in 29 Section 75B(1) provides: "(1) A reference in this Part to a person involved in a contravention of a provision of Part IV … shall be read as a reference to a person who: has been in any way, directly or indirectly, knowingly concerned in, or party to, the contravention …" Strictly speaking it was unnecessary to consider whether s 75B applied so far as the remedies granted against McAuliffe and Law were penalties under s 76 and injunctions granted under s 80. Sections 76(1) and 80(1) each have provisions similar to s 75B(1) in relation to accessorial liability. However, the inquiry relevant to accessorial liability is the same in relation to those provisions. The trial judge also granted declarations against McAuliffe and Law, and s 75B(1) appears to have been thought relevant in that respect. for the purpose or had the likely effect of substantially lessening competition … in the market as defined." It is wholly unrealistic to seek to characterise knowledge of circumstances in that way. Only a handful of lawyers think or speak in that fashion, and then only at a late stage of analysis of any particular problem. In order to know the essential facts, and thus satisfy s 75B(1) of the Act and like provisions, it is not necessary to know that those facts are capable of characterisation in the language of the statute30. The Commission's appeal: section 46 The Full Federal Court's reasoning on s 46. The trial judge found that Rural Press and Bridge had contravened s 46. The Full Federal Court disagreed on the ground that though they had the necessary market power and the necessary purpose, they had not taken advantage of their power in the Murray Bridge regional newspaper market but rather had taken advantage of their access to a printing press in Murray Bridge and to the necessary administrative and professional structure to publish a competing newspaper31. Rural Press and Bridge could have credibly threatened to enter the Riverland market, and could have actually entered it, regardless of whether they had a substantial degree of power in the Murray Bridge regional newspaper market. "Had there been a perfectly competitive market in the Murray Bridge newspaper market, they may have lacked the motivation to make the threat, but they could have acted in precisely the same way."32 The Full Federal Court said that the Commission, having chosen to plead and prove a very narrow market, with consequential advantages in terms of establishing market power and substantially anti- competitive purpose and effect, could not put that aside by treating the resources 30 As the courts below correctly found: Australian Competition and Consumer Commission v Rural Press Ltd (2001) ATPR ¶41-804 at 42,743 [138]; Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at 31 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at 277 [143]. The Rural Press printing press at Murray Bridge printed three newspapers for Rural Press other than the Standard, as well as one independent newspaper, each serving other areas (Kingscote, Strathalbyn, Tanunda and Victor Harbor). 32 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at 279 [150]. of Rural Press and Bridge, "which have no relevant relationship with that narrow market, as resources of or attributable to that market."33 The Commission's s 46 arguments. The Commission argued that the relevant conduct was "the making of conditional threats" that unless Waikerie Printing withdrew the River News from the Mannum area, Rural Press and Bridge would introduce a rival newspaper in the Riverland market. This condition provided a causal connection to the Murray Bridge regional newspaper market in which Rural Press and Bridge had substantial market power. The conditional threats would not have been made if Rural Press and Bridge had not had that market power. The market power also facilitated the conduct by giving the threat a significance it would not otherwise have had34. The Commission submitted one relevant question was: "Would [Rural Press and Bridge] be likely to engage in the same conduct in the absence of market power, that is to say, in a competitive market?"35 A second was: "Why is the conduct being engaged in?"36 The Commission answered the first question "No", because the purpose of Rural Press and Bridge was merely to protect their monopoly position in the Murray Bridge regional newspaper market. The Commission answered the second question: "To protect the monopoly position of Rural Press and Bridge in the Murray Bridge regional newspaper market." The Commission submitted that the trial judge had answered the first question correctly by concluding that but for their market power, Rural Press and Bridge "would not have acted in the way in 33 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at 280 [151]. 34 Referring to Melway Publishing Pty Ltd v Robert Hicks Pty Ltd (2001) 205 CLR 1 35 The first question was said to be based on what Mason CJ and Wilson J said in Queensland Wire Industries Pty Ltd v Broken Hill Proprietary Co Ltd (1989) 167 CLR 177 at 192 and what the majority said in Melway Publishing Pty Ltd v Robert Hicks Pty Ltd (2001) 205 CLR 1 at 23 [50]. The Commission referred to many other passages in these cases, and to Dowling v Dalgety Australia Ltd (1992) 34 FCR 109 at 144; NT Power Generation v Power and Water Authority (2002) 122 FCR 399 at 446-450 [172]-[179] and Australian Competition and Consumer Commission v Australian Safeway Stores Pty Ltd (2003) 198 ALR 657 at 722-724 36 The second question was said to be based on what Toohey J said in Queensland Wire Industries Pty Ltd v Broken Hill Proprietary Co Ltd (1989) 167 CLR 177 at which they did"37 but that the Full Federal Court instead made an erroneous inquiry into how they could have acted38. Their conduct would not have been rational but for their market power and their desire to protect it. Conclusion on s 46. The words "take advantage of" do not extend to any kind of connection at all between market power and the prohibited purposes described in s 46(1). Those words do not encompass conduct which has the purpose of protecting market power, but has no other connection with that market power. Section 46(1) distinguishes between "taking advantage" and "purpose". The conduct of "taking advantage of" a thing is not identical with the conduct of protecting that thing. To reason that Rural Press and Bridge took advantage of market power because they would have been unlikely to have engaged in the conduct without the "commercial rationale" – the purpose – of protecting their market power is to confound purpose and taking advantage. If a firm with market power has a purpose of protecting it, and a choice of methods by which to do so, one of which involves power distinct from the market power and one of which does not, choice of the method distinct from the market power will prevent a contravention of s 46(1) from occurring even if choice of the other method will entail it. The Commission's criticism of the Full Federal Court for asking whether Rural Press and Bridge "could" engage in the same conduct in the absence of market power must be rejected. A majority of this Court in Melway Publishing Pty Ltd v Robert Hicks Pty Ltd adopted the same test in saying39: "Bearing in mind that the refusal to supply the respondent was only a manifestation of Melway's distributorship system, the real question was whether, without its market power, Melway could have maintained its distributorship system". The Commission did not demonstrate either that that did not mean what it said, or that what it said should be overruled. The Commission failed to show that the conduct of Rural Press and Bridge was materially facilitated by the market power in giving the threats a 37 Australian Competition and Consumer Commission v Rural Press Ltd (2001) ATPR ¶41-804 at 42,742 [132] (emphasis added). 38 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at 276 [139], 279 [150]. 39 (2001) 205 CLR 1 at 26 [61]. significance they would not have had without it. What gave those threats significance was something distinct from market power, namely their material and organisational assets. As the Full Federal Court said, Rural Press and Bridge were in the same position as if they had been new entrants to the Murray Bridge market, lacking market power in it but possessing under-utilised facilities and expertise40. The Commission's argument received no support from the authorities it relied on. It is only necessary to refer to two of them. The Commission cited McHugh J's statement in Boral Besser Masonry Ltd v Australian Competition and Consumer Commission that "use" does not capture the full meaning of "take advantage", and that there "must be a causal connection between the 'market power' and the conduct alleged to have breached s 46."41 Among the passages in Melway Publishing Pty Ltd v Robert Hicks Pty Ltd to which McHugh J referred in justification of what he said was the following42: "[I]t does not follow that because a firm in fact enjoys freedom from competitive constraint, and in fact refuses to supply a particular person, there is a relevant connection between the freedom and the refusal. Presence of competitive constraint might be compatible with a similar refusal, especially if it is done to secure business advantages which would exist in a competitive environment." That is adverse to the Commission's submission, and suggests that McHugh J was not including within "causal connection" the mere existence of a purpose of protecting market power. The Commission submitted that Natwest Australia Bank Ltd v Boral Gerrard Strapping Systems Pty Ltd43 showed the need for a "causal connection between the substantial market power and the conduct" which "would be established if the corporation relied on its market power to insulate it from the 40 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at 277 [143]. 41 (2003) 77 ALJR 623 at 667 [279]; 195 ALR 609 at 668. 42 (2001) 205 CLR 1 at 27 [67]. 43 (1992) 111 ALR 631. consequences that competition would ordinarily visit [on it]." The relevant passage in the judgment of French J reads44: "The conduct must … constitute a use of that power. It is not sufficient to show that a corporation with market power has engaged in conduct for [one of the prohibited purposes] … If a corporation with substantial market power were to engage an arsonist to burn down its competitor's factory and thus deter or prevent its competitor from engaging in competitive activity, it would not thereby contravene s 46. There must be a causal connection between the conduct alleged and the market power pleaded such that it can be said that the conduct is a use of that power. In many cases the connection may be demonstrated by showing a reliance by the contravener upon its market power to insulate it from the sanctions that competition would ordinarily visit upon its conduct." That, however, leaves the anterior question: did the corporation rely on its market power in that way? To possess the purpose of protecting it is not necessarily to rely on it. The Commission's appeal: section 4D The trial judge's reasoning on s 4D. The trial judge held that the arrangement had a subjective purpose45: "of preventing or restricting or limiting the supply of services to the particular class or classes of persons, being those in the Mannum area (or in that area and extending to a [line] about forty kilometres north of Mannum) who could otherwise receive the information and news in the River News or who could otherwise advertise in the River News or take advantage of advertising in the River News." Those classes will be referred to below as readers and advertisers. The trial judge thus held that the arrangement contained an exclusionary provision. 44 (1992) 111 ALR 631 at 637. 45 Australian Competition and Consumer Commission v Rural Press Ltd (2001) ATPR ¶41-804 at 42,733 [91]. The parties did not dispute that this was the correct test, as held in News Ltd v South Sydney District Rugby League Football Club Ltd (2003) 77 ALJR 1515 at 1520 [18] per Gleeson CJ, 1524 [43] per McHugh J, 1527- 1528 [63]-[64] per Gummow J, 1556-1557 [212] per Callinan J; 200 ALR 157 at The Full Federal Court's reasoning on s 4D. The Full Federal Court disagreed with the trial judge because it thought that the relevant class must be "the intended object of the discrimination envisaged by the section."46 It must be "aimed [at] specifically"47. This requirement was not satisfied because there was no finding and no "evidence which would point to any of the persons involved in the arrangement having the actual purpose of specifically targeting the persons in the nominated geographic area"48. The purpose of Rural Press and Bridge was to preserve their market power in the Murray Bridge market and other markets; the purpose of Waikerie Printing was to preserve its market power in the Riverland area. The Full Court said49: "It is hardly surprising that there is no finding that the arrangement was aimed at the class of persons defined by his Honour, or that they were specifically targeted by any of the parties to the arrangement. For the parties to act in this way would make no sense. The class of persons identified by the primary judge simply consisted of customers or potential customers of the [River News]. They were not direct or indirect competitors of either party to the arrangement. There is no reason to suppose that either party should have had any purpose to injure or disadvantage those persons." The readers and advertisers would suffer a limitation in their ability to have access to a second local newspaper, but that was the effect of the arrangement, not its purpose50. No purpose related to a "particular class" existed51. 46 South Sydney District Rugby League Football Club Ltd v News Ltd (2000) 177 ALR 611 at 661 [214] per Finn J. 47 News Ltd v Australian Rugby Football League Ltd (1996) 64 FCR 410 at 577. 48 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at 265 [103]. 49 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at 265 [103]; see also at 267 [108]. 50 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at 266 [104]. 51 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at 267 [108]. The Full Federal Court thought that the trial judge's construction of "exclusionary provision" had three consequences so unacceptable as to demonstrate error in it. One was a statutory guarantee that customers could have access to goods or services provided by a particular supplier52: "[A]ny market sharing, zoning or other 'non-compete' provision will be a breach of s 45(2)(a)(ii) if it has the purpose, or would be likely to have the effect, of substantially lessening competition in a market. If a provision does not have that effect, it may be assumed that competing substitutable goods or services will be actually or potentially available in that market. The ... Act does not guarantee that customers will have access to the goods or services provided by a particular supplier. Pushing the concept of an exclusionary provision too far will have that consequence." The second unacceptable consequence would be that s 4D of the Act would apply to "market sharing or zoning … without more"53. A third unacceptable consequence would be that s 4D would extend beyond "a conventional boycott situation where competitors come to an arrangement in order to prevent other competitors entering the market."54 The Full Federal Court also relied on implications it drew from other parts of the Act and from the explanatory materials. One was55: "[T]here is a clear distinction between purpose and effect, recognised in the express terms of s 45 itself. The difference is not eliminated in the case where the effect either is or could be predicted". 52 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at 266 [104]. The first two sentences of this passage must be rejected in so far as they contend that the Full Federal Court's construction produces no mischief, because if the conduct is otherwise unlawful it will be stopped, and if it is otherwise lawful acquirers will have access to goods or services from sources other than the party restrained. That contention would justify reading s 4D down to the point of invisibility. 53 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at 266 [104]. 54 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at 267 [107]. 55 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at 266 [104]. Further, the Full Federal Court saw it as significant that though what is known as the Swanson Report56 "recommended that the prohibition relate to arrangements having the relevant purpose or effect"57, Parliament did not follow this: the "legislation only refers to purpose, and not to effect."58 Before examining the above arguments, it is convenient briefly to deal with some other matters advanced by the Commission. Contrary decisions? The Commission submitted that the Full Federal Court's opinion that s 4D is inapplicable to a geographic market sharing arrangement between competitors was "contradicted by numerous decisions of the Federal Court that have applied s 4D to market sharing arrangements." This submission was incorrect. Of the nine cases referred to, seven were cases in which there were admissions of liability and the only issue was the level of the pecuniary penalty59. One of these seven cases does not even suggest that the matter was viewed in s 4D terms60. The eighth was a case where, though no contravention was admitted and the facts were contested, no argument is recorded along the lines of those advanced in the present case61. And the ninth 56 Australia, Trade Practices Act Review Committee, Report to the Minister for Business and Consumer Affairs, Parliamentary Paper No 228/1976 (August 1976). 57 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at 262 [92]. 58 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at 262 [92]; see also at 266 [104]. 59 Australian Competition and Consumer Commission v Jaycee Rectification and Building Services Pty Ltd (1996) ATPR ¶41-539; Australian Competition and Consumer Commission v SIP Australia Pty Ltd (1999) ATPR ¶41-702; Australian Competition and Consumer Commission v Tyco Australia Pty Ltd (2000) ATPR ¶41-740; Australian Competition and Consumer Commission v Tubemakers of Australia Ltd (2000) ATPR ¶41-745; Australian Competition and Consumer Commission v Simsmetal Ltd (2000) ATPR ¶41-764; Australian Competition and Consumer Commission v Roche Vitamins Australia Pty Ltd (2001) ATPR ¶41-809; Australian Competition and Consumer Commission v ABB Transmission and Distribution Ltd (2001) ATPR ¶41-815. 60 Australian Competition and Consumer Commission v Tyco Australia Pty Ltd (2000) ATPR ¶41-740. 61 Australian Competition and Consumer Commission v SIP Australia Pty Ltd (2002) ATPR ¶41-877 at 45,012-45,013 [102]-[106], 45,014 [108(a)]. was a case where it was not disputed at the trial that the conduct was an exclusionary provision, the contrary was not asserted in the Notice of Appeal or the contravener's written submissions, and the Commission did not deal with the points in argument. Though the Full Federal Court did so, the circumstances were different from the present case and the arguments considered in the present case were not put62. In short, not one of the cases relied on is in any sense a decision – a conclusion necessary to resolve a concrete dispute reached after contest in argument – that geographic or other market sharing falls within s 4D of the Act. But that is not to say that the Commission fails in its other submissions that the Full Court erred in its treatment of s 4D. Introduced qualifications. The Commission contended that if the Full Federal Court were intending to suggest that members of the s 4D class will usually or perhaps always be "direct or indirect competitors of the parties" and that s 4D only applied to "boycotts", there was no warrant for these qualifications in s 4D. This is so. As to the first qualification, s 4D does not require particular persons or classes of persons to be competitors of the parties. If it is appropriate to look at extrinsic materials, the Explanatory Memorandum, in discussing the amendments introduced in 1986 to include "particular classes of persons" in addition to "particular persons", said63: "A primary boycott is, in essence, collective refusal to deal by competitors to the detriment of another competitor or a person from whom the parties to the collective action could or do supply or acquire goods or services." There is, in addition, authority against limiting s 4D to competitors of the parties to the arrangement64. It is also correct to reject the qualification about "boycotts" because the term "boycott" lacks "a precise meaning", and use of it carries the danger of distracting the inquirer towards seeking that meaning "rather than the proper task, which is finding the meaning of the statutory language."65 62 J McPhee & Son (Australia) Pty Ltd v Australian Competition and Consumer Commission (2000) 172 ALR 532 at 564-565 [108]-[111]. 63 See par 15 (emphasis added). 64 For example, South Sydney District Rugby League Football Club Ltd v News Ltd (2000) 177 ALR 611 at 659 [209]; News Ltd v South Sydney District Rugby League Football Club Ltd (2003) 77 ALJR 1515 at 1530 [78] per Gummow J; 200 ALR 65 News Ltd v South Sydney District Rugby League Football Club Ltd (2003) 77 ALJR 1515 at 1520 [19] per Gleeson CJ; 200 ALR 157 at 163. What kind of purpose? It is convenient now to examine the primary reason why the Full Federal Court reversed the trial judge – the absence of any finding of animus against the readers and advertisers of the Mannum area. It may be accepted that in one sense the Rural Press parties meant no special harm to the readers and advertisers, wanted them to remain in the market as acquirers of the services offered by the Standard and wanted them to be as well disposed towards the Standard as possible. But that is not an answer to the s 4D case. "The purpose of conduct is the end sought to be accomplished by the conduct."66 The end which the parties endeavoured to accomplish by the arrangement was preventing, restricting or limiting the supply of newspaper services by Waikerie Printing to readers and advertisers in the Mannum area. The Rural Press parties did willingly contemplate harm to the readers and advertisers in the sense that they did not want them to enjoy the freedom of being able to acquire the relevant services from the River News. The Full Federal Court's reasoning concentrates too narrowly on the purpose of preventing Waikerie Printing selling papers to readers and space to advertisers, and not enough on the correlative – the purpose of preventing readers buying papers and advertisers buying space from Waikerie Printing. The relationship between a buyer and a seller is not merely symbiotic. The link is inextricable. A supply by sale is an acquisition by purchase. There cannot be a seller without a buyer. There cannot be a supplier without an acquirer. There cannot be supply without acquisition. If one's purpose is to prevent the supply of services, an inevitable part of that purpose is to prevent the acquisition of those services by the person or persons to be supplied. Thus when the Full Federal Court accepted the trial judge's finding that the purpose of Rural Press and Bridge was to maintain their market power in Murray Bridge by preserving absence of competition in that market67, it was accepting that their purpose was to maintain their market power in Murray Bridge by ensuring that the Standard would be the only paper and that readers and advertisers would not enjoy the services of the River News. The purpose of maintaining market power was indistinguishable from the purpose of preventing supply of certain services to, 66 News Ltd v South Sydney District Rugby League Football Club Ltd (2003) 77 ALJR 1515 at 1520 [18] per Gleeson CJ; 200 ALR 157 at 163. 67 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at 265 [103]. and acquisition of those services by, readers and advertisers. Acquisition of those services by readers and advertisers from the River News was inconsistent with the prevention of supply by the River News. It was not possible for the Rural Press parties consistently to say both that they had a purpose of preventing the River News from supplying services to readers and advertisers and also that they did not have a purpose of preventing readers and advertisers from acquiring services from the River News. "You could not have one without the other, however much you protested that you did not really want the other."68 Superadded purpose requirement: the text. The Full Federal Court's construction required some element of purpose which was more than the purpose of limiting supply to readers and advertisers – some superadded purpose or animus of injuring or disadvantaging them beyond the limiting of supply. The requirement would only have textual support if s 4D(1)(b) commenced with the words "the provision has the purpose of injuring particular persons or classes of persons by preventing …" Yet it does not. Superadded purpose requirement: the cases. The Full Federal Court relied on an obiter dictum69 of Finn J in South Sydney District Rugby League Football Club Ltd v News Ltd70: "For the class to have significance for s 4D purposes it must be the intended object of the discrimination envisaged by the section. If it is not so 'aimed at' specifically … the members of the alleged class do not constitute a 'particular class' for s 4D(1) purposes". Finn J gave a reference after the word "specifically" to News Ltd v Australian Rugby Football League Ltd71. The Full Federal Court in that case at the point identified said: "The Commitment Agreements were clearly aimed specifically at News as a rival competition organiser". The Court there was not making any decisive point about construction: it was merely summarising the facts. Finn J's 68 South Sydney District Rugby League Football Club Ltd v News Ltd (2001) 111 FCR 456 at 473 [75] per Heerey J. 69 News Ltd v South Sydney District Rugby League Football Club Ltd (2003) 77 ALJR 1515 at 1528 [70] per Gummow J; 200 ALR 157 at 174-175. 70 (2000) 177 ALR 611 at 661 [214]. See also South Sydney District Rugby League Football Club Ltd v News Ltd (2001) 111 FCR 456 at 471-474 [61]-[78], 505-507 71 (1996) 64 FCR 410 at 577. reference to "the intended object of the discrimination" was a reference to the discrimination which it was the purpose of the provision in the arrangement to achieve between those whose supply was to be cut off and those whose supply was to be maintained. Finn J's language is compatible with the readers and advertisers here being particular classes of persons in relation to whom the provision had the purpose of preventing supply; it does not support the need to establish some superadded purpose to injure. Finn J's language suggests only that the word "purpose" in relation to particular persons or classes of persons means that they must be the intended objects of the discrimination by reason of the provision having the purpose that one party to the arrangement is not to supply them while remaining free to supply other people. The "some" who are purposely not supplied and therefore cannot acquire are the intended objects of the discrimination. The decision of this Court in News Ltd v South Sydney District Rugby League Football Club Ltd, handed down after the decision of the Full Federal Court, demonstrates that in s 4D there is no requirement of "aiming at" or "targeting". Gummow J pointed out that in 1986 s 4D was amended by the addition of the words "or classes of persons" after the words "particular persons". He said that this change reflected a particular legislative goal, namely72: "the legislative goal of removing a limitation upon s 4D which required the precise identification of those sought to be prevented, restricted or limited in their conduct by the purpose of the exclusionary provision. The goal was not to require the infliction of damage or harm to those persons by reason of the operation of the purpose. An object may be one on, or about whom, something (here, the purpose) acts or operates. … [B]oth Souths and the ACCC submit that the use of expressions in some of the later cases73 such as 'targeted' and 'aimed at' places an unwarranted gloss upon s 4D and incorporates assumptions and requirements derived from case law concerning collective boycotts. These submissions correctly emphasise the need to construe the terms of the legislation free from notions of anti-competitive conduct which are not necessarily incorporated in s 4D … 72 (2003) 77 ALJR 1515 at 1529-1530 [76]-[79]. McHugh J agreed with Gummow J at 1525 [46]. Kirby J agreed at 1544 [157]. Callinan J's opinion at 1558-1559 [226]-[227] is similar; 200 ALR 157 at 169, 176-177, 196, 215-216. 73 See News Ltd v Australian Rugby Football League Ltd (1996) 64 FCR 410 at 577. [T]he terms of s 4D take as a compound element the purpose of preventing, restricting or limiting the supply or acquisition of goods or services to or from particular persons or classes of persons. It is preferable to speak of the purpose of the provision being 'directed toward' a particular class rather than 'aimed at' or 'targeted'. This avoids the connotations of aggression or the inducement of harm, typically found in judicial discussions of boycotts, of which Souths and the ACCC rightly complain." The purpose of the provision in this case was "directed towards" the readers and advertisers in the Mannum area because it was a purpose of maintaining the market power of the Rural Press parties in that area by limiting the supply of services to the readers and advertisers through causing the circulation of the River News to their advantage to cease. The readers and advertisers were objects, "on, or about whom" that purpose operated. Was the Full Federal Court right to say that the inability of readers and advertisers to have access to a second local newspaper was no part of the purpose of the arrangement, but only an effect of it in the nature of "collateral damage"? Apart from Waikerie Printing, they were the only persons to suffer damage from the arrangement. Their damage was the obverse of its. Without Waikerie Printing's damage, that of the readers and advertisers would not have existed. The euphemism "collateral damage" refers to what happens when one target is aimed at, but by accident another is hit. Here the parties to the arrangement did not miss any target. What they hit they were aiming at. The history of s 4D. The Full Federal Court's approach cannot be justified by recourse to the Swanson Report and the later history of s 4D. The legislative background to the Swanson Report is that in the 1974 form of the Act, s 45(2) prohibited contracts, arrangements or understandings "in restraint of trade or commerce". Section 45(3) provided that price fixing arrangements were not in restraint of trade or commerce "if the restraint has such a slight effect on competition between the parties to the contract, arrangement or understanding, and on competition between those parties or any of them and other persons, as to be insignificant." Section 45(4) provided that other arrangements were not in restraint of trade or commerce "unless the restraint has or is likely to have a significant effect on competition between the parties to the contract, arrangement or understanding or on competition between those parties or any of them and other persons." On the other hand, s 47 (exclusive dealing), s 49 (price discrimination) and s 50 (mergers) adopted a test of substantial lessening of competition in a market for the conduct described in those sections. That was one striking difference between s 45 as it then stood and as it now stands. The second is that what are now known as exclusionary provisions were not prohibited unless they could be held to be "in restraint of trade", which was questionable in view of the construction given to those words shortly before the Swanson Report74. The Swanson Report recommended that the "restraint of trade" threshold should be abandoned75; that the test of insignificant or significant effect on competition between the parties in s 45 should be abandoned, and a test of substantial effect on competition in a market substituted76; but that for "collective boycotts" a different regime should apply77: "We consider that a collective boycott, ie an agreement that has the purpose of or the effect of or is likely to have the effect of restricting the persons or classes of persons who may be dealt with, or the circumstances in which, or the conditions subject to which, persons or classes of persons may be dealt with by parties to the agreement, or any of them, or by persons under their control, should be prohibited if it has a substantial adverse effect on competition between the parties to the agreement or any of them or competition between those parties or any of them and other persons." "[S]uch matters are appropriate to be tested by reference to their competitive effect between parties and other persons, and not by reference to a market." There were three respects in which s 4D as enacted in 1977 departed from the Swanson Report recommendations. First, as the Full Federal Court said, in requiring that the proscribed contract, arrangement or understanding turn on purpose, Parliament did not follow the recommendation about the effect or likely Secondly, Parliament did not adopt the effect of restricting dealings. recommendation about "classes of persons". Thirdly, Parliament did not follow the recommendation that the legality of the agreement should depend on there being "a substantial adverse effect on competition between the parties to the 74 Quadramain Pty Ltd v Sevastapol Investments Pty Ltd (1976) 133 CLR 390. 75 Par 4.8. 76 Par 4.14. 77 Par 4.116 (emphasis added). 78 Par 4.117. agreement or any of them or competition between those parties or any of them and other persons." The two Second Reading Speeches of the Minister did not explain why any of these three departures from the recommendations took place. The Second Reading Speech of 3 May 1977 did say that "boycotting the commercial activities of particular persons is generally undesirable conduct"79, but did not say why. These extrinsic materials have no utility in solving the present problem for the following reasons. The Swanson Report was extremely brief and vague about what it called "collective boycotts". The Swanson Report was not dealing with the precise issue. Nor were the Second Reading Speeches. In any event, Parliament departed from the Swanson Report to a radical extent. The next stage in the history of s 4D after its enactment in 1977 was in 1978. Section 4D(2) as enacted in 1977 did not require the parties to the arrangement to be competitive in relation to the supply or acquisition of the same goods or services as those to which the exclusionary provision related. Section 4D(2) as enacted in 1978 did. This change is of no present significance, save that it reveals an early consciousness that s 4D had teething problems. The next change took place after Franki J, in Trade Practices Commission v TNT Management Pty Ltd, that arrangements between various defendants not to deal with Tradestock Pty Ltd or any broker in relation to the carrying of freight contained exclusionary provisions on the ground that "an arrangement … not to deal with a class or category of persons does not satisfy the requirement of an arrangement … not to deal with 'particular persons'."80 That authority was reversed in 1986 when s 4D assumed its current form. rejected an allegation The references which the Full Federal Court made to the Swanson Report, to the two Second Reading Speeches in 1977, and to parts of the Explanatory Memoranda in 1977 and 1986 may have been pursuant to the Acts Interpretation Act 1901 (Cth), s 15AB(1). While the Full Federal Court obviously took the contrary view, it cannot be said that the meaning attributed to s 4D by the trial 79 Australia, House of Representatives, Parliamentary Debates (Hansard), 3 May 80 (1985) 6 FCR 1 at 75-76; cf Bullock v The Federated Furnishing Trades Society of Australasia (No 1) (1985) 5 FCR 464 at 473. judge was not the ordinary meaning; or that that meaning led to a manifestly absurd or unreasonable result; or that s 4D was in the relevant sense ambiguous or obscure. No doubt the general law justified resort to the extrinsic materials in order to attempt to identify the mischief with which the legislature was dealing. But whatever the justification for looking at the extrinsic materials, they do not cast light on the construction issue or support the construction adopted in the Full Federal Court. And it cannot be contended that the Executive said "that the proposed legislation means one thing in order to ensure the passing of the legislation and then [argued] in court that the legislation bears the opposite meaning."81 Explanation of per se character of s 4D. The Full Federal Court queried why arrangements containing exclusionary provisions lead to liability without proof of a purpose or effect of substantially lessening competition. Why are they given "such draconian treatment"82? The answer given was that the legislature felt "abhorrence of a boycott, namely, an intentional shutting-out of particular persons or classes of persons from access to goods or services, where that is the aim or object of the agreement."83 That in turn led the court to a search for someone whom the provision was "aimed at" or "specifically targeted". It is true that some have attributed the statutory prohibition of exclusionary provisions to a desire to avoid "unfair trading" because exclusionary provisions involve an "unfair … exercise of power against a targeted person or class of persons"84. That may be one purpose, but it is not the only one. There are practices which Parliament has seen as so generally offensive to the competitive goals underlying the Act that they are to be condemned without consideration of any purpose or effect of substantially lessening competition in a market. One practice is price fixing arrangements (s 45A), unless the conduct can also be characterised as exclusive dealing (in which event s 45(6)85 may 81 Steyn, "The Intractable Problem of the Interpretation of Legal Texts", (2003) 25 Sydney Law Review 1 at 15. 82 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at 262 [93]. 83 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at 263 [93]. 84 South Sydney District Rugby League Football Club Ltd v News Ltd (2000) 177 ALR 611 at 659 [209]. 85 See generally Visy Paper Pty Ltd v Australian Competition and Consumer Commission (2003) 201 ALR 414. remove them from s 45 for consideration under s 47), or unless they provide for the acquisition of shares or assets (in so far as they do, s 45(7) removes them from s 45 for consideration under s 50). Another example is resale price maintenance (ss 48 and 96-100, removed from s 45 by s 45(5)(c)). A third is that type of exclusive dealing known as third line forcing (s 47(6), (7), (8)(c) and (9)(d)). Another is taking advantage of a substantial degree of market power for prohibited purposes (s 46). Yet another is the prohibition against arrangements containing exclusionary provisions86. Parliament treated price fixing as unlawful without inquiry into anti-competitive purpose or effect because it shared the perception of United States courts that in general it lacked "any redeeming virtue"87. The same is true, it may be inferred, of the other practices described. Market sharing arrangements are commonly viewed as meriting treatment in that way, unless they are of the type exempted by s 51(2)(d) or (e) or unless they create sufficient public benefits to permit them to be authorised under ss 88 and 9088. Though the treatment of market sharing arrangements under United States law is not a closely relevant guide to the construction of s 4D, it is not surprising that they are per se violations of §1 of the Sherman Act 1890 (US)89. It is therefore not a reason to reject a particular construction of s 4D that it extends 86 Kirby J assembled various economic arguments against exclusionary provisions in News Ltd v South Sydney District Rugby League Football Club Ltd (2003) 77 ALJR 1515 at 1535 [113], 1536 [115], 1536-1537 [118]; 200 ALR 157 at 184, 185, 87 Northern Pacific Railway Co v United States 356 US 1 at 5 (1958). 88 Thus Walker, "The Trade Practices Act at Work", in Nieuwenhuysen (ed), Australian Trade Practices: Readings, 2nd ed (1976) 146 at 157 stated that market sharing "is in a sense more inherently anti-competitive than price-fixing. Excess capacity will often lead to surreptitious discounts or rebates which will lessen the impact of a price agreement, but a market-sharing agreement is designed to create an area of monopoly in which competitors themselves, and hence price competition, are totally absent." 89 United States v Topco Associates Inc 405 US 596 (1972); Palmer v BRG of Georgia Inc 498 US 46 at 49-50 (1990). The width of this line of authority has been criticised by Bork J ("The Rule of Reason and the Per Se Concept: Price Fixing and Market Division", (1966) 75 Yale Law Journal 373 at 380-384; Rothery Storage & Van Co v Atlas Van Lines Inc 792 F 2d 210 at 226-230 (1986)); but its correctness in relation to "naked" market sharing of the type engaged in by the Rural Press parties is not doubted. See also Hovenkamp, Antitrust Law, vol 11 (1998), ¶1910c at 255. "draconian treatment" to the type of market sharing arrangement involved in this appeal90. Examples of absurdity? The Rural Press parties gave three examples of conduct which they said, on the Commission's construction, fell within s 4D. They said that that outcome was so absurd as to demonstrate error in that construction. The first example was that of two restaurants in separate ownership having between them a combined capacity of one hundred, which their owners agreed to close and replace with a single new restaurant having a capacity of sixty. In practice, such an agreement would deal with the goodwill of the former restaurants; those items of goodwill would be assets; the new entity would doubtless acquire those assets; in so far as it did, and subject to the operation of s 51(2)(e), s 50 would apply to that acquisition and, by reason of s 45(7), s 45(2)(a)(i) and (b)(i) would not. But even if, and to the extent that, s 45 applied, for the reasons explained in News Ltd v South Sydney District Rugby League Football Club Ltd91 there would not be any exclusionary provision. The purpose of the arrangement would have been to define the size of the restaurant. That would produce a result that only sixty persons could be served at one time. But there would be no purpose of denying service to any particular forty people or to any particular class of people, and no characteristic by reference to which those unable to dine could be described as "particular" objects of any purpose. The second example concerned participants in a mining, oil and gas joint venture who set up "a joint marketing service arrangement by which they agree upon the geographical areas that they will service." This is a difficult example to analyse without more detail. If the participants sold their production to a company in which each of them owned shares subject to an arrangement containing a provision that the company would market the product and a provision that the participants would not supply those areas, this latter provision would be s 47(4) exclusive dealing which would not be treated as an exclusionary provision by reason of s 45(6). If the production and distribution were carried out entirely by a joint venture company formed before any activity by the parties as independent competitors, the Act would not be attracted at all. 90 Kirby J assumed that market sharing fell within s 4D in News Ltd v South Sydney District Rugby League Football Club Ltd (2003) 77 ALJR 1515 at 1536-1537 [118]; 200 ALR 157 at 186. 91 (2003) 77 ALJR 1515 at 1520-1521 [20]-[23] per Gleeson CJ; 200 ALR 157 at If parties commenced activity as independent competitors and then one acquired the other's assets, or they created a joint venture company which acquired their respective assets, by reason of s 45(7), s 50 would apply, not s 45. If the joint venture were a partnership, s 45 would not apply to it because of s 51(2)(d). If each party, acting as an independent competitor, extracted from the mining prospect what it could and agreed to sell in some areas but not others, s 4D may well be attracted, but this is not an absurd outcome. The third example was of the only two solicitors in Mannum going into partnership but agreeing not to provide family law services. Section 51(2)(d) of the Act avoids absurdity by providing that regard is not to be had to that term in determining whether a contravention of s 45 has been committed. Other issues? The Full Federal Court said that it was unnecessary to come to a final view on whether there was a lack of particularity in the class of persons identified by the trial judge, namely customers and potential customers of the River News92. Very little attention was directed to it in argument in this Court because the Rural Press parties submitted that it was not necessary for this Court to become involved in that question. They did submit that the particular class could not be all readers and advertisers in the Mannum area, but must be limited to those deprived of the benefit of Emmins' services, and must be qualified by the fact that there were still readers of and advertisers in the River News from the Mannum area after April 1998. The weakness in the submission is that it confuses the qualified success of the arrangement with the absolute nature of its purpose. The Rural Press parties called no evidence to suggest that the purpose was qualified in the manner suggested. The purpose found by the trial judge is entirely consistent with the evidence, particularly the internal records of and the conduct of the Rural Press parties. In the circumstances it is sufficient to say that the trial judge adequately defined a class: even though the identity of all of its members at any one time might not be readily ascertainable, s 4D does not require that93. Even if s 4D does require that, it would be possible to draw up a list of advertisers who had used the River News, and that would be a sufficient class to render the provision an exclusionary provision. It would also be possible to draw up a list, though perhaps an incomplete list, of readers of the River News. The Commission's contentions cannot be dismissed by reason of issues on which such limited argument was offered. 92 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at 267 [108]. 93 News Ltd v South Sydney District Rugby League Football Club Ltd (2003) 77 ALJR 1515 at 1529-1530 [77] per Gummow J; 200 ALR 157 at 176. The same is true of the question, which had a faint presence in argument, of whether it is erroneous to define a particular class by the fact of its exclusion from supply or acquisition. In ASX Operations Pty Ltd v Pont Data Australia Pty Ltd (No 1)94 there is a passage which some have alleged to rest on an error of this kind. In this case no argument was directed in this Court to the question; the Full Federal Court came to no view about it95; and News Ltd v South Sydney District Rugby League Football Club Ltd96 did not overrule the case in that respect and only one member of this Court criticised it. In any event, to define a particular class by reference to its geographical location is not to define it by the fact of its exclusion from supply or acquisition, because it is identified at the time of the arrangement97 and indeed identifiable before that time. Orders The trial judge's orders. The trial judge made declarations that Rural Press and Bridge had contravened s 46; that Rural Press, Bridge and Waikerie Printing had contravened s 45; that McAuliffe and Law were directly or indirectly knowingly concerned in the contraventions by Rural Press and Bridge of ss 45 and 46; and that Paul Taylor was directly or indirectly knowingly concerned in the contraventions by Waikerie Printing of s 45. The Rural Press parties made no complaint about these declarations to the Full Federal Court or to this Court. The declarations spoke merely of "an arrangement" having a purpose and effect, without giving any content to that expression and without indicating the gist of the findings of the primary judge identifying the arrangement. These declarations provide a bad precedent and were of a kind which the trial judge should not have agreed to make even if urged to do so by the parties. Close attention to the form of proposed declarations, particularly those "by consent", should be paid by primary judges. 94 (1990) 27 FCR 460 at 488. 95 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236 at 267-268 [108]. 96 (2003) 77 ALJR 1515. Callinan J criticised the passage at 1557-1558 [217] and 1559 [228]; but Gummow J accepted it at 1529 [74], McHugh J concurred with Gummow J at 1525 [46], and neither Gleeson CJ nor Kirby J referred to it; 200 ALR 157 at 169, 175-176, 214, 216. 97 News Ltd v South Sydney District Rugby League Football Club Ltd (2003) 77 ALJR 1515 at 1557-1558 [217] per Callinan J; 200 ALR 157 at 214. Secondly, the trial judge granted injunctions for three years against each of the above respondents. The Commission drafted the injunctions, they correspond substantially with those sought in the Application which initiated the proceedings, and the Rural Press parties did not complain about them in the Full Federal Court or in this Court. However, in respects which need not be elaborated, the injunctions against a breach of s 46 and against a breach of s 45 in relation to exclusionary provisions appear to go beyond the Act impermissibly98. The trial judge also made penalty orders. The abandonment of the Notice of Appeal. In oral argument the Commission abandoned its application for the orders set out in the Notice of Appeal. Instead the Commission proposed, and the Rural Press parties accepted, that the following orders should be made in the event of the Commission's appeal succeeding only on s 4D and the Rural Press parties' appeal failing: The appeal be allowed. The orders made by the Full Court of the Federal Court on 16 July 2002 and 18 October 2002 be set aside. The orders made by the Federal Court on 23 March 2001 be set aside, and in lieu thereof substitute the following orders: (a) A declaration that the First, Second and Fifth Respondents contravened section 45(2) of the Act by making and giving effect to an arrangement that contained provisions under which: the Fifth Respondent agreed to cease soliciting advertising and newsworthy information from the Mannum area for inclusion in its regional newspaper, the River News, and to cease promoting the sale of the River News in the Mannum area; and the First and Second Respondents agreed not to publish a regional newspaper in the Riverland area, 98 ICI Australia Operations Pty Ltd v Trade Practices Commission (1992) 38 FCR as these provisions constituted an exclusionary provision within the meaning of sections 4D of the Act, and had the purpose and lessening competition in the market for the supply of regional newspapers in the Murray Bridge district of South Australia. likely effect of substantially (c) A declaration that each of the Third and Fourth Respondents were knowingly concerned in or party to the First and Second Respondents' contraventions of [section] 45(2) ... of the Act as set out in [paragraph (a)] above. (d) A declaration that the Sixth Respondent was knowingly concerned the Fifth Respondent's contravention of section 45(2) of the Act as set out in paragraph (a) above. in or party The Orders made by the Federal Court on 7 August 2001 (other than orders 7 and 9) be reinstated. The First, Second, Third and Fourth Respondents pay the costs of the Appellants of this Appeal (No A203 of 2002) and the First, Second, Third and Fourth Respondent's Appeal No S141 of 2002 to the Full Federal Court. the First, Second, Third and Fourth The Appellant pay Respondent's costs of the ACCC's Cross-Appeal No S141 of 2002 to the Full Federal Court in respect of remedial orders." Conclusion on orders. Order 4 should not be made. The orders of the Full Federal Court did not set aside the trial judge's orders of 23 August 2001 relating to penalties. The tailpiece to par 3(a) of the proposed orders should be omitted: it is defective for the same reason that the trial judge's declarations were defective. With that omission, there is some utility in the particular circumstances of these appeals in making the declarations to which the parties consent. The degree to which the Commission succeeded has changed from stage to stage of these proceedings, and it is convenient to have set out in the declarations not only the basis for the primary liability and accessorial liability found, but also the basis for the penalties ordered as it must now be understood. The orders of the Full Federal Court made on 16 July and 18 October 2002 were the declarations and injunctions granted by the trial judge modified to accommodate the success of the Rural Press parties in relation to s 4D and s 46. Even with the declarations now made, the Commission has not succeeded in this appeal in obtaining any order in substance more beneficial to it than the orders made by the Full Federal Court. Further, even if the Commission's construction of s 4D had been accepted in the Full Federal Court, it would have been in no materially better position there than it is now. The Full Federal Court would have made wider declarations and granted wider injunctions. But those wider declarations would have been in an unsatisfactory form, and the wider injunctions would not have given it any substantial advantage not secured by the narrower injunctions. For that reason there is no need to change the costs orders made by the Full Federal Court. The Commission should receive its costs of the Rural Press parties' appeal to this Court. In its own appeal to this Court, it failed on one ground, succeeded on another and neither sought nor obtained any substantive order. Hence, there should be no order as to the costs of that appeal. Indeed, in view of the Commission's failure to obtain any substantive order on its own appeal, and at least to the extent to which it verged on a request for an advisory opinion, there is a strong argument that it should have to pay the Rural Press parties' costs of the appeal. However, the Commission's appeal can be justified as a defensive tactic, employed as a means of preserving its position on penalties against the possibility that the Rural Press parties' appeal might succeed, at least up to the time when it became clear that that possibility had vanished, namely, by the close of their argument on their appeal; and the Rural Press parties made no request for an order in their favour. The orders of the Court should be: Appeal No A197 of 2003 is dismissed with costs. Appeal No A203 of 2003 is allowed. Paragraph 3 of the orders made by the Full Court of the Federal Court of Australia on 16 July 2002 as amended on 18 October 2002 is set aside, and in lieu thereof the following orders are made: The orders made by the Federal Court on 23 March 2001 be set aside and in lieu thereof, order that the following orders be made: (a) A declaration that the First, Second and Fifth Respondents contravened section 45(2) of the Trade Practices Act by making and giving effect to an arrangement that contained provisions under which: the Fifth Respondent agreed to cease soliciting advertising and newsworthy information from the Mannum area for inclusion in its regional newspaper, the River News, and to cease promoting the sale of the River News in the Mannum area; and the First and Second Respondents agreed not to publish a regional newspaper in the Riverland area. (b) A declaration that each of the Third and Fourth Respondents were knowingly concerned in or party to the First and Second Respondents' contraventions of section 45(2) of the Act as set out in sub-paragraph (a) above. (c) A declaration that the Sixth Respondent was knowingly the Fifth Respondent's concerned contravention of section 45(2) of the Act as set out in sub- paragraph (a) above." in or party Kirby 100 KIRBY J. Once again, proceedings are before this Court concerned with the meaning and application of provisions of the Trade Practices Act 1974 (Cth) ("the Act")99. A principal object of that Act is to protect and advance competition in markets in the Australian economy100. This is a large national purpose. It is also important for Australia's international competitiveness. It invokes objectives beneficial for consumers in local markets and for the national economy. The Act should not be given a narrow interpretation that defeats its effectiveness. So far as its language permits, it should receive the meaning that ensures the achievement of its important objects101. These opening remarks reflect a theme stated by me in earlier decisions102. In my opinion, they help to explain differences that have emerged between the approaches taken by the majority of this Court in decisions delivered since Queensland Wire Industries Pty Ltd v Broken Hill Proprietary Co Ltd103 and the opinions that I have favoured104. Generally speaking, in other contexts, this Court has adopted the principle of a purposive construction of legislation105. It is a principle having special application to legislation with protective objects beneficial to consumers and to the community at large. No exception should be 99 ss 4D, 45, 46 and 75B. 100 The Act, s 2 (the Act's purpose is stated as "to enhance the welfare of Australians through the promotion of competition and fair trading and provision for consumer protection"). 101 Bropho v Western Australia (1990) 171 CLR 1 at 20 approving Kingston v Keprose Pty Ltd (1987) 11 NSWLR 404 at 421-424 per McHugh JA (diss). 102 Melway Publishing Pty Ltd v Robert Hicks Pty Ltd (2001) 205 CLR 1 at 35-37 [90]-[92]; Boral Besser Masonry Ltd v Australian Competition and Consumer Commission (2003) 77 ALJR 623 at 676-677 [323]; 195 ALR 609 at 682; News Ltd v South Sydney District Rugby League Football Club Ltd (2003) 77 ALJR 1515 at 1531 [90]; 200 ALR 157 at 178-179. 103 (1989) 167 CLR 177. 104 cf Griggs, "Unconscionability in the High Court – the ACCC on the receiving end again!", (2003) 19 Australian and New Zealand Trade Practices Law Bulletin 21 at 105 See eg CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408; Newcastle City Council v GIO General Ltd (1997) 191 CLR 85 at 112-113; Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 381 [69], 384 [78]; Eastman v Director of Public Prosecutions (ACT) (2003) 77 ALJR 1122 at 1150 [140] fn 94; 198 ALR 1 at 39. Kirby carved out for cases involving responses to anti-competitive conduct by corporations and their officers. Yet that, in my respectful opinion, is effectively what has happened. The facts, legislation and issues There are two appeals before this Court. The facts relevant to the appeals are set out in the reasons of Gummow, Hayne and Heydon JJ ("the joint reasons")106. Those reasons contain the sections of the Act in question107. They describe the successive decisions of the primary judge in the Federal Court of Australia (Mansfield J)108 and of the Full Court of that Court109. I will avoid unnecessary repetition. The joint reasons explain how the primary judge, after an extensive hearing, considering evidence concerned with events which occurred over many months and comprised in a great mass of evidentiary material110, concluded that the Australian Competition and Consumer Commission ("the Commission") had proved that Rural Press Limited ("Rural Press"), Bridge Printing Office Pty Ltd ("Bridge"), Mr Trevor McAuliffe and Mr Ian Law (of Rural Press), and Waikerie Printing House Pty Ltd ("Waikerie") and Mr Paul Taylor (of Waikerie) were in breach of the anti-competition provisions of the Act. Relevantly, the primary judge found that the corporate interests of Rural Press and Waikerie had contravened s 45 of the Act in that they had: entered an arrangement or arrived at an understanding containing an exclusionary provision111; 106 Joint reasons at [13]-[28]. 107 Joint reasons at [13], fnn 11, 12 and 13 (ss 4D, 45 and 46) and at [47], fn 29 (s 75B). 108 Australian Competition and Consumer Commission v Rural Press Ltd (2001) ATPR ¶41-804. 109 Rural Press Ltd v Australian Competition and Consumer Commission (2002) 118 FCR 236. 110 The hearing before the primary judge lasted nine days. The transcript of evidence and voluminous affidavits filled six appeal books in this Court. 111 The Act, s 45(2)(a)(i) as defined in s 4D of the Act. Kirby entered an arrangement or arrived at an understanding that contained provisions having the purpose or effect of substantially lessening competition in a market112; and given effect to this arrangement or understanding113. The primary judge also found contravention by the Rural Press corporate respondents of s 46 of the Act. He upheld the Commission's claim that officers of all corporations, notably Mr McAuliffe and Mr Law, were "knowingly concerned" in the corporate contraventions of Rural Press. The Rural Press corporations and Messrs McAuliffe and Law appealed to the Full Court of the Federal Court. Their appeal was allowed in part. A cross- appeal by the Commission against the penalties imposed at trial was rejected. The Full Court upheld the submission by the Rural Press corporations that the primary the Commission had proved contravention of the provisions relating to "exclusionary provisions" and of s 46 of the Act. judge had erred in finding that It was in this way that the battle lines in this Court were set, once special leave to appeal was granted to the remaining contesting parties. Rural Press, Bridge and Messrs McAuliffe and Law challenged the orders of the Full Court in so far as those orders upheld the findings of contraventions of s 45 of the Act and the conclusion that Messrs McAuliffe and Law were knowingly concerned in such contraventions. For its part, the Commission appealed against the dismissal of its claim that the Rural Press corporations had contravened the provisions of the Act concerned with "exclusionary provisions" and s 46 of the Act and that the executives were knowingly concerned in, or party to, such contravention114. Neither Waikerie nor Mr Taylor of Waikerie took any part in the Commission's appeal. In effect, this left the battle to be fought between the Rural Press interests and the Commission. Concurrence and narrowing the divergence The Rural Press appeal: The joint reasons explain the three complaints which the Rural Press interests argued in their appeal115. I agree that their appeal 112 s 45(2)(a)(ii). 113 s 45(2)(b)(i) and (ii). 114 Joint reasons at [15]. 115 Joint reasons at [29]-[48]. Kirby should be dismissed with costs on the basis stated in the joint reasons. This leaves the Commission's appeal challenging the decision of the Full Court to the effect that the arrangement impugned by the Commission did not contain an "exclusionary provision" (within s 4D of the Act) and that the Rural Press interests had not contravened s 46 of the Act. The Commission's appeal: s 4D of the Act: I can deal first with the Commission's appeal relating to the requirements of s 4D. The nature of that appeal, its foundation in the reasoning of the Full Court and various issues argued in the appeal to this Court116 are set out in the joint reasons in terms that I accept. In News Ltd v South Sydney District Rugby League Football Club Ltd117, a question arose that was also debated in the present appeal. That question concerned whether the "purpose" referred to in s 4D(1)(b) of the Act was a "subjective purpose of the parties to the contract, arrangement or understanding … or … an objective construct, deduced by a court when obliged to characterise the 'purpose' in question". In News, for reasons that I explained, I concluded that the better view of the "purpose" in s 4D was that it required the court to decide its own characterisation of the purpose in question, ie to provide an objective classification118. In his reasons in News, McHugh J, although not pressing his opinion to a dissent, also considered that to be the better view of the Act119. I adhere to my opinion that the application of a subjective test by the Full Court, in this case, as in that, involved error. However, on the facts, as in News, this point is immaterial. The Commission was correct in its submission that whether a subjective or an objective approach was adopted, the requirements of s 4D of the Act were satisfied on the evidence established in this case. In any event, I am bound to accept (as the joint reasons point out)120 that, following News, this Court has decided that the search for determining the "purpose" of the impugned 116 Joint reasons at [57]-[88]. 117 (2003) 77 ALJR 1515 at 1538 [126]; 200 ALR 157 at 188. 118 (2003) 77 ALJR 1515 at 1539 [130]; 200 ALR 157 at 189. 119 (2003) 77 ALJR 1515 at 1522-1524 [32]-[43]; 200 ALR 157 at 166-169. 120 Joint reasons at [57]. Kirby "arrangement" is for the subjective purpose of the parties121. It follows that no legal error occurred in the adoption by the primary judge of that approach. Putting that point aside, I agree with the remaining analysis in the joint reasons concerning the requirements of s 4D. In News122, I expressed my concurrence in the observations of Gummow J in that case123, to the effect that notions of malice and the language of deliberate "targeting", "discriminating" or "aiming at" a competitor are not necessary for the purposes of s 4D of the Act. Nor is that section limited in its application to circumstances where the concerted action could be classified as a "boycott"124. I still hold those views. It follows that I agree with the conclusions in the joint reasons critical of the reasoning of the Full Court in this respect125. However, as the joint reasons point out, News was not handed down until after the decision of the Full Court in this case. It was not, therefore, available to the Full Court in this case. I also agree with the conclusions in the joint reasons derived from the history of s 4D of the Act126. That analysis reflects some of my own reasoning in News concerning the legislative history of ss 4D and 45 of the Act, the terms of the report of the Swanson Committee127, preceding approaches in United States anti-trust law128 and the selective response of the Federal Parliament in Australia to the Swanson Committee's recommendations129. I therefore concur in the conclusions in the joint reasons as to the meaning of s 4D of the Act, its application to the facts of the present case and the lack of persuasiveness of the complaints of the Rural Press parties that this conclusion 121 News (2003) 77 ALJR 1515 at 1520 [18] per Gleeson CJ, 1524 [43] per McHugh J, 1527-1528 [63]-[64] per Gummow J, 1556-1557 [212] per Callinan J; 200 ALR 122 (2003) 77 ALJR 1515 at 1544 [157]; 200 ALR 157 at 196. 123 (2003) 77 ALJR 1515 at 1529-1530 [77]; 200 ALR 157 at 176. 124 (2003) 77 ALJR 1515 at 1544 [157]; 200 ALR 157 at 196. 125 Joint reasons at [64]-[72]. 126 Joint reasons at [73]-[80]. 127 (2003) 77 ALJR 1515 at 1536-1537 [116]-[118]; 200 ALR 157 at 185-186. 128 (2003) 77 ALJR 1515 at 1536 [115]-[116]; 200 ALR 157 at 185. 129 (2003) 77 ALJR 1515 at 1537-1538 [119]-[124]; 200 ALR 157 at 186-188. Kirby produces a "Draconian" outcome for the market-sharing arrangement between the Rural Press corporations and Waikerie impugned by the Commission. I do not find such a description apt. The application of the Act to such a market- sharing arrangement is precisely what one would expect from a modern statute of this kind, designed to protect and advance competition in Australian markets. Moreover, it is what s 4D of the Act provides in terms. I therefore agree with the joint reasons in their conclusions concerning the disposition of the Commission's appeal in respect of the Full Court's erroneous conclusions about ss 4D and 45(2)(a)(i) and (b)(i) of the Act. Taking advantage of market power for proscribed purposes Decision of the primary judge: This brings me to the point where I part company with the joint reasons. The Commission alleged that the conduct of Rural Press and Bridge involved "taking advantage" of their market power for a proscribed anti-competitive purpose, contrary to s 46 of the Act. The conduct relied upon by the Commission to constitute such "taking advantage" was the threats made by Rural Press and Bridge, and accepted by the primary judge to have been made, to the effect that, if Waikerie did not withdraw the activities of the River News from the Mannum area of South Australia, Rural Press would retaliate by publishing a rival newspaper in the Riverland area. In his reasons, the primary judge found that the conduct alleged by the Commission to constitute a "taking advantage of market power" had occurred130. His Honour found that such conduct involved a breach of s 46 of the Act131. Bridge admitted, and consequently Rural Press accepted, that they enjoyed a substantial degree of market power in the Murray Bridge regional newspaper market. No attempt was made in the appeal to the Full Court to resile from that admission or to suggest that the factual foundation for it was mistaken or unproved132. Decision of the Full Court: Nevertheless, the Full Court held that, in making the conditional threat, Rural Press and Bridge had not "taken advantage" of their market power. Substantially, the reasons advanced for this conclusion were that the initiation of a rival newspaper in the Riverland area of South Australia would not have involved taking advantage of any power that Rural Press and Bridge held in the Murray Bridge market133 and that Rural Press could, 130 (2001) ATPR ¶41-804 at 42,721 [26], 42,727-42,728 [68]-[72], 42,740 [123]. 131 (2001) ATPR ¶41-804 at 42,743 [134]. 132 (2002) 118 FCR 236 at 275 [134]. 133 (2002) 118 FCR 236 at 276-277 [142]. Kirby or might, have commenced a regional newspaper in the Riverland area irrespective of the existence, or absence, of any "market power". Any "market power" was therefore legally irrelevant134. Before explaining why I differ from other members of this Court in respect of this aspect of the Commission's appeal, and from the Full Court in its analysis and application of s 46 of the Act, I pause to remark upon what I respectfully regard as the unreality of the conclusion that is now adopted. The evidence and commercial realism: Here was Waikerie, with its modest regional newspaper the River News, keen to take advantage of potentially new market opportunities arising from the formation of a new and larger local government authority. Waikerie hoped to expand its distribution and to give Rural Press' and Bridge's Standard some competition. Doing so would be for the benefit of readers and advertisers within the given market135. Here, on the other hand, was Rural Press, with its numerous subsidiary companies, with net assets of $410 million in 2000, large numbers of regional newspapers and magazines in Australia and overseas and an annual pre-tax profit in 2000 of $99 million, engaged in the threatening conduct found by the primary judge. Mr McAuliffe and Mr Law were well aware of the financial strength of Rural Press136. They were clearly conscious of its significant physical and capital resources and profitability, and of the capacity of the Rural Press parties to weather a battle with Waikerie to "persuade" (or bully) the latter out of the notion of competition – an idea which fondly, for a short time, Waikerie had embraced. This Court now holds that the Full Court was correct to reverse the primary judge's decision and to conclude that the conditional threat by Rural Press and Bridge to Waikerie, which caused the latter's competitive dreams to collapse so quickly, happened without Rural Press and Bridge "taking advantage" of their "market power". In the end, this conclusion appears to be explained, in a comparatively short passage of reasoning, essentially by reference to the use by the Full Court of the word "could"137 and the concurrence of that word with the language employed by the majority of this Court in a cited passage in Melway Publishing Pty Ltd v Robert Hicks Pty Ltd138. 134 (2002) 118 FCR 236 at 279 [149]-[150]. 135 cf joint reasons at [44]-[46]. 136 Joint reasons at [25]. 137 (2002) 118 FCR 236 at 276 [140], 279 [150]. 138 (2001) 205 CLR 1 at 26 [61]. Kirby In Melway the same word "could" was employed139. I dissented from the reasoning in Melway. I regard that decision as inconsistent with the holding of this Court in Queensland Wire140 – a decision that has never been overruled. However, even accepting what was said in Melway, it takes a great leap of legal imagination, in my view, to dispose of the Commission's appeal in this case upon such a narrow, formalistic and substantially verbal ground. If, for a moment, this Court turns from the words in judicial reasons to the reality of the pressure brought to bear by Rural Press and Bridge upon Waikerie, illustrated in the evidence adduced before and read by the primary judge in his extended hearing, realism suggests that the effect of that pressure, the speed of its impact and the success of its application to the starry-eyed officers of Waikerie involved "taking advantage" of the market power of Rural Press and Bridge. For a blissful moment Waikerie had conceived itself as entitled to pursue a policy of competition with Rural Press and Bridge. The suggestion that the application by Rural Press and Bridge of their "market power" was causally irrelevant to the swift retreat of Waikerie seems, with every respect, to border on the fanciful. At least it does so if the concept of "taking advantage" of market power is to be understood in the context of a market, ie in an economic and therefore a practical sense. A closer examination of the facts found by the primary judge and the reasoning of the Full Court confirms the foregoing impression, based upon a practical assessment of the circumstances of the dealings between the parties which is the way, I believe, that the Act was intended to operate in such cases. It was open to the primary judge to conclude as he did: (1) that the Rural Press parties made the economic threats to Waikerie; (2) that there was some evidence that Mr Law (from Rural Press) had informed Mr Darnley Taylor (from Waikerie) that the commercial response of Rural Press and Bridge might include the publication of a free newspaper in the Riverland area; (3) that Rural Press already published a free newspaper in competition with another local printer in another local market; (4) that Rural Press and Bridge were in a position to carry out their threats; (5) that the threats were only made because market power existed; (6) that they were made to maintain and preserve that market power; (7) that initiating private communications, such as were made in this case, is not routine nor conduct commonly involved in the exercise of competitive rights; (8) that the threats contained in the communications were credible because of the market power of the Rural Press interests in the Murray Bridge regional newspaper market; (9) that the market power enjoyed by Rural Press and Bridge 139 Joint reasons at [52]. 140 (1989) 167 CLR 177. Kirby included their physical and financial resources; and (10) that the purpose of the communications was to deter Waikerie from engaging in competitive conduct in the Murray Bridge regional newspaper market and for the purpose of eliminating Waikerie from that market. On these findings, the conclusion of the primary judge that the Rural Press corporations had breached s 46 of the Act was correct, indeed inevitable. As s 46 provides no explicit guidance as to the conduct designed to be prohibited in varying factual circumstances, the policy objectives of both the Act and the section should be borne in mind when interpreting the section141. I have already referred to the objectives stated in the Act142. This Court has acknowledged those objectives. In Queensland Wire it was said that "[t]he objective [of s 46] is the protection and advancement of a competitive environment and competitive conduct"143. Further, the former Trade Practices Commission, in relation to interpreting "take advantage of market power", said that it would "consider whether conduct: adversely affects the competitive process; adversely affects consumers in terms of price, quality, availability of choice or convenience"144. These views were expressed in 1990. They remain relevant today. They reinforce the policy objectives of s 46. The postulate of s 46 of the Act is that a competitive market will protect consumers and advance the interests of the public of Australia more generally. The conditional threat from Rural Press and Bridge extinguished any chance of competition. It adversely affected consumers and the competitive process in terms of availability of choice, as it forced the withdrawal of a competitor and its product from the market. Rural Press and Bridge did not, as they were entitled to do, compete in the market on the basis of the price or quality of their product. Rather, they threatened to retaliate in a way that was a 141 Corones, "The Characterisation of Conduct under Section 46 of the Trade Practices Act", (2002) 30 Australian Business Law Review 409 at 410. 142 See [100]. 143 (1989) 167 CLR 177 at 194; see also at 213. See also Melway (2001) 205 CLR 1 at 144 Stewart, "The Economics and Law of Section 46 of the Trade Practices Act", (1998) 26 Australian Business Law Review 111 at 125-126 citing Trade Practices Commission, Misuse of Market Power, Background Paper (1990) at 33. Kirby clear contravention of s 46. With respect, the result of the analysis in the joint reasons in this Court does not protect or promote competition or the competitive process. It stifles it. Misdescription of the relevant conduct: A closer examination of the case confirms these impressions. First, the Full Court erred in describing the relevant conduct of Rural Press and Bridge as the "threat to compete with [Waikerie] in the Riverland market in which Rural Press and [Bridge] had no market power (or, indeed, presence)"145. That was not a complete description of the impugned conduct. Such conduct included a conditional threat. It was to engage in specified activities unless Waikerie withdrew the River News from the Mannum area. The condition inherent in the threat made it one relevant to the "market" in question. It provided the causal link between the "market power" of Rural Press and Bridge in the Murray Bridge regional newspaper market and Waikerie's proposed conduct. The mischaracterisation of the impugned conduct of Rural Press and Bridge by the Full Court was central to its reasoning. The Full Court reached its conclusion on the basis that a threat to enter, or actually to enter, the Riverland market could be made by a corporation with no market power, provided it had access to the necessary printing facilities146. However, with all respect, this remark is irrelevant. It is not accurate, or sufficient, to describe the conduct of Rural Press and Bridge as confined to a foreshadowed or actual entry into the Riverland market. It was the conditional threat of Rural Press to enter the Riverland market unless Waikerie withdrew the River News from the Mannum area, and to follow this up with all of the considerable means at its disposal, that amounted to "taking advantage of market power". The Full Court recognised that, had the Murray Bridge regional newspaper market been competitive, Rural Press and Bridge might have lacked the motivation to make the threat that they did147. However, acceptance of this fact should have demonstrated that there was no business or economic reason for the conditional threat that Rural Press and Bridge made, if they lacked substantial market power. The primary judge correctly recognised that, absent such "market power", deployed by Rural Press and Bridge in the Murray Bridge market, those companies would not have acted as they did. In making their conditional threats, Rural Press and Bridge were indicating a willingness to forego potential revenue and the expansion of their business. They gave conditional undertakings to 145 (2002) 118 FCR 236 at 276 [141]. 146 (2002) 118 FCR 236 at 277 [143]. 147 (2002) 118 FCR 236 at 279 [150]. Kirby Waikerie that they would not expand into the Riverland area in return for a reciprocal undertaking by Waikerie to withdraw from the Murray Bridge market. If Rural Press and Bridge did not enjoy substantial market power in the Murray Bridge market, they would have faced competitive restraints from other suppliers. Such restraints would have deprived them of any significant benefit from procuring an undertaking from Waikerie to withdraw from the Murray Bridge market. The only way in which the conditional threats made commercial sense, therefore, was because Rural Press and Bridge had enjoyed a near monopoly in the Murray Bridge market and were seeking to restore that monopoly position by taking advantage of their market power. Only this explanation discloses why they were willing to give up an opportunity for expansion because of what they stood to gain by the restoration of their monopoly in the Murray Bridge market. The primary judge was correct to so conclude. The Full Court erred in giving effect to its contrary view. The excusing criterion of possibilities: The joint reasons justify the Full Court's opinion on this issue by reference to that Court's application of the criterion of whether Rural Press and Bridge "could" have engaged in the same conduct in the absence of market power148. It is here that, citing the passage from Melway where the same verb is used, a conclusion is reached that the Full Court has approached the matter in the correct and legally authorised way. I disagree. The point made for the Commission was that the Full Court in the present case had used the word "could" in the sense of a "mere physical possibility" rather than (as Queensland Wire and Melway require) considering the impugned conduct by reference to commercial considerations, applied to the facts. As the Commission correctly submitted, there is a great difference between a test of physical possibility and one of commercial likelihood. There may be few forms of commercial conduct that are physically impossible, with or without substantial market power. However, such a criterion affords no assistance in distinguishing conduct that involves "taking advantage of market power", in a way forbidden by s 46 of the Act, from that which does not. I am prepared to accept that "taking advantage of market power" involves something more than merely "using" such power149. I am also prepared to agree that a "causal connection" must be shown between the relevant "market power" and the conduct alleged to have breached s 46 of the Act. However, I do not accept that the primary judge fell into the error of believing that a temporal 148 Joint reasons at [52]. 149 Boral (2003) 77 ALJR 623 at 667 [279] per McHugh J; 195 ALR 609 at 668. See joint reasons at [55]. Kirby concurrence of power and outcome was all that was required. Nor did the Commission make such a rudimentary error. That this is true is shown by the Commission's reliance on the following passage from the reasons of the majority in Melway150: "To ask how a firm would behave if it lacked a substantial degree of power in a market … involves a process of economic analysis which, if it can be undertaken with sufficient cogency, is consistent with the purpose of s 46. But the cogency of the analysis may depend upon the assumptions that are thought to be required by s 46. In some cases, a process of inference, based upon economic analysis, may be unnecessary. Direct observation may lead to the correct conclusion." the Commission submitted, detailed economic analysis was unnecessary. It was sufficient to compare what occurred with patterns of commercial behaviour that could be expected in competitive markets and to ask whether the impugned conduct of Rural Press and Bridge in this case departed from such patterns. It was clearly open to the primary judge to conclude as he did. The Full Court erred in substituting a contrary opinion. The Full Court's reasoning cannot be endorsed simply because of the use of the word "could". Truly, that is to permit a relatively minor verbal coalescence to overwhelm the analysis undertaken by the primary judge addressed to the entirety of the conduct of Rural Press and Bridge by reference to the competitive norms to which the Commission properly urged that weight should be given. Identification of the pressure and the market: The Commission also drew to notice a third error on the part of the Full Court. This was the Full Court's finding that the conduct of Rural Press and Bridge was not conduct that occurred in the Murray Bridge market where the market power was enjoyed151. In this Court, the Commission correctly emphasised that this finding presented a false issue because, ultimately, it was not the foundation of the Full Court's conclusions152. The Commission was surely correct in observing that the Full Court's reasoning portrayed a confusion about the conditional threat made by Rural Press and Bridge and the actions that were threatened, namely entry by Rural Press into the Riverland area. Even if the conduct of Rural Press and Bridge were viewed, incorrectly, as involving entry into another market, such conduct could also involve "taking advantage of market power" in the Murray Bridge regional newspaper market. 150 (2001) 205 CLR 1 at 23-24 [52]-[53]. 151 (2002) 118 FCR 236 at 276-277 [142], 277-278 [146]-[147]. 152 (2002) 118 FCR 236 at 278-279 [148]-[150]. Kirby Ultimately, this possibility was recognised by the Full Court153. However, properly analysed, the impugned conduct was not entry into another market. It was a conditional threat of entry into Waikerie's market if Waikerie did not withdraw from the Murray Bridge market. The conditional threat was causally connected with the Murray Bridge market because it was only by virtue of the substantial market power of Rural Press and Bridge in the Murray Bridge market that a commercial reason existed for making the conditional threat. It was only because of the market power of Rural Press and Bridge in that market that they enjoyed the resources and economic power necessary to carry out their conditional threat so as to make it real and effective. Conclusion: restore trial decision: It follows that it was well open to the primary judge to conclude that it was Waikerie's speedy recognition of the market power that Rural Press and Bridge exerted, and of the willingness, ability and resolve of Rural Press and Bridge to deploy that power, that caused Waikerie to back off and abandon its dream of new market competition. This deprived potential readers and advertisers of the services of Waikerie's newspaper154. Most important of all, it involved Rural Press and Bridge "taking advantage" of their "market power". It was therefore conduct that breached s 46 of the Act as the primary judge found. The Full Court had no warrant to disturb that finding. This Court should restore it. A trilogy and the doctrine of innocent coincidence: This is the third recent decision of this Court (Melway and Boral Besser Masonry Ltd v Australian Competition and Consumer Commission155 being the other two) in which a majority has adopted an unduly narrow view of s 46 of the Act. In effect, it has held, in each case, that the established large degree of market power enjoyed by the impugned corporation was merely incidental or coincidental to the anti- competitive consequences found to have occurred. Notwithstanding the proof of market power, the Court has held that the impugned corporations did not directly or indirectly "take advantage" of that power to the disadvantage of competition in the market. In my view, the approach taken by the majority is insufficiently attentive to the object of the Act to protect and uphold market competition. It is unduly protective of the depredations of the corporations concerned. It is unrealistic, bordering on ethereal, when the corporate conduct is viewed in its commercial 153 (2002) 118 FCR 236 at 277-278 [146]. 154 cf joint reasons at [67]. 155 (2003) 77 ALJR 623; 195 ALR 609. Kirby and practical setting. The outcome cripples the effectiveness of s 46 of the Act. It undermines this Court's earlier and more realistic decision in Queensland Wire. The victims are Australian consumers and the competitors who seek to engage in competitive conduct in a naive faith in the protection of the Act. Section 46 might just as well not have been enacted for cases like these where its operation is sorely needed to achieve the purposes of the Act. Judicial lightning strikes thrice. A novel doctrine of innocent coincidence prevails. Effective anti- competitive threats can be made without the redress which s 46 appears to promise. Once again I dissent. Objections to the form of orders in the Federal Court In the joint reasons, comments are made critical of the form of the relevant declarations made in the Federal Court, although (as is pointed out)156 the parties made no complaint about that matter either in this Court or below. I have previously expressed my hesitation over attempts to subject to the rigidities of traditional equity practice the scope of declaratory and injunctive orders of the Federal Court, made pursuant to broad powers in a remedial statute, in novel circumstances, to afford new protections for large and important social and economic purposes157. However, because, upon the majority of the issues that were contested in these appeals (specifically those concerning s 45 of the Act), I agree in the analysis and conclusions of the joint reasons, I am disinclined to press my hesitation over matters of form to dissent over the orders. I will therefore content myself with repeating my suggestion that this Court should avoid procedural traditionalism in this field of remedial statutory law. This notwithstanding, in the conclusions that I reach, the Commission was entitled to succeed in its appeal in respect of the Full Court's decision concerning ss 4D and 46 of the Act. Having regard to that conclusion, it cannot be said that the Commission is in no materially better position than it was following the Full Court's decision158. To the contrary, in the view that I take of the application of s 46, the Commission has been fully vindicated. 156 Joint reasons at [89]-[90]. 157 Melway (2001) 205 CLR 1 at 48-49 [121]-[122]; cf Levy v Victoria (1997) 189 CLR 579 at 650-652; Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 158 Joint reasons at [97]. Kirby Orders In the result, therefore, I agree in the orders proposed in the joint reasons. However, to those orders should be added, in par 2, the words "with costs". It should be further ordered that par 1 of the orders of the Full Court of the Federal Court of Australia made on 16 July 2002 should be set aside and in its place, this Court should order that the appeal to that Court by the first, second, third and fourth appellants be dismissed with costs, such costs to be paid by the first and second appellants. As a result, par 2 of the orders of the Full Court of the Federal Court made on 18 October 2002 should be set aside. In addition to the orders proposed in par 3 of the orders contained in the joint reasons there should be added orders further varying those made by the primary judge as follows: "(d) A declaration that the First and Second Respondents contravened section 46(1)(a) of the Act by taking advantage of their substantial degree of power in the market for the provision of regional newspapers in the Murray Bridge district for the purpose of eliminating the Fifth Respondent, a competitor of the First and Second Respondents, in that market. (e) A declaration that the First and Second Respondents contravened section 46(1)(c) of the Act by taking advantage of their substantial degree of power in the market for the provision of regional newspapers in the Murray Bridge district for the purpose of deterring or preventing the Fifth Respondent from engaging in competitive conduct in that market." I would also order liberty to apply for supplementary orders, such liberty to be exercised within 28 days.

HIGH COURT OF AUSTRALIA APPELLANT AND PERPETUAL TRUSTEE COMPANY LIMITED RESPONDENT Westfield Management Limited v Perpetual Trustee Company Limited [2007] HCA 45 3 October 2007 ORDER Appeal dismissed with costs. On appeal from the Supreme Court of New South Wales Representation B W Walker SC with R G McHugh SC and N J Owens for the appellant (instructed by Speed and Stracey Lawyers) N C Hutley SC with S Flanigan, J C Giles and S J Free for the respondent (instructed by Deacons Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Westfield Management Limited v Perpetual Trustee Company Limited Real property – Torrens system land – Easements – An easement granted the right to go, pass and repass for all purposes to and from the appellant's dominant tenement over the respondent's servient tenement – The appellant sought to use the easement in order to access remoter properties adjoining the dominant tenement – Whether such use was permitted by the easement. Real property – Torrens system land – Easements – Construction – Whether the expression "to and from" encompassed access across the dominant tenement to remoter properties – Whether the expression "for all purposes" encompassed access across the dominant tenement to remoter properties. Evidence – Torrens system land – Easements – Construction – Whether evidence was admissible regarding the intention or contemplation of the parties at the time of, or subsequent to, the grant – Relevance of the Torrens Register. Words and phrases – "for all purposes", "to and from". Real Property Act 1900 (NSW), ss 31B, 96B. Conveyancing Act 1919 (NSW), ss 88B, 181A. GLEESON CJ, GUMMOW, KIRBY, HAYNE AND HEYDON JJ. This litigation concerns the terms of an easement conferring a right of way by means of a vehicular ramp under the servient tenement. What is at stake is access to, from and over several parcels of land in the central business district of the City of Sydney. All of these parcels are registered under the provisions of the Real Property Act 1900 (NSW) ("the RP Act"). The appellant ("Westfield") is the present registered proprietor of the dominant tenement1 upon which is erected the multi-storey commercial premises known as "Skygarden". The respondent ("Perpetual") is the registered proprietor of the servient tenement2 upon which is erected the multi-storey commercial premises known as "Glasshouse". Glasshouse fronts both King Street and a pedestrian precinct known as the Pitt Street Mall which runs at a right angle to King Street. Skygarden abuts the Pitt Street Mall. This pedestrian precinct lacks ordinary vehicular access. Hence the importance for Skygarden of access across the Glasshouse site to King Street. The legislation Section 88B(2) of the Conveyancing Act 1919 (NSW) ("the Conveyancing Act") specifies requirements for the registration of plans which provide for the creation of easements. Upon registration of such plans the easements are created without any further assurance and by virtue of that registration (s 88B(3)(c)). Section 47 of the RP Act provides for the recording of a dealing creating an easement, with entries on the folios of the Register for the land benefited and the land burdened. This was done with respect to the Skygarden land and the Glasshouse land. Section 31B of the RP Act requires the Registrar-General to maintain the Register. The Register comprises, among other instruments and records, both folios and dealings registered therein under the RP Act (s 31B(2)). A "dealing" includes any instrument registrable under the provisions of the RP Act (s 3(1)). Section 96B classifies the Register as a public record and provides for its inspection. Together with the information appearing on the relevant folio, the registration of dealings manifests the scheme of the Torrens system to provide 1 Certificate of Title Volume 8638 Folio 220. 2 Certificate of Title Volume 8633 Folio 6. Kirby Hayne third parties with the information necessary to comprehend the extent or state of the registered title to the land in question. This important element in the Torrens system is discussed by Barwick CJ in Bursill Enterprises Pty Ltd v Berger Bros Trading Co Pty Ltd3. It will be necessary later in these reasons to refer further to the significance of this for the present appeal. The easement with which this litigation is concerned ("the Easement") was created upon registration of DP 641047 ("the DP") on 26 April 1988. The DP included an instrument ("the Instrument") headed: "Instrument Setting Out Terms of Right of Way Intended to Be Created Pursuant to Section 88B, Conveyancing Act, 1919". The terms of the Easement identify it as: "Right of Way 6.6 wide and variable limited in height to the strata delineated on the plan." The attached plan shows entry from King Street and thence by subterranean passage or driveway across and beneath the Glasshouse land to the boundary of the Skygarden land. At the time of creation of the Easement, the registered proprietor of the Glasshouse site was Jamino Pty Ltd ("Jamino") and the registered proprietor of the Skygarden site was Mastwood Pty Ltd ("Mastwood"). Perpetual and Westfield are respectively the present successors in title to Jamino and Mastwood. The Pitt Street Mall The Pitt Street Mall was created in 1987. This implemented a plan adopted in 1983 by the Council of the City of Sydney ("the Council") for the closure of Pitt Street between King Street and Market Street to traffic. Construction on the Glasshouse site commenced in about 1987. A vehicular ramp under Glasshouse was completed in about 1988, substantially in accordance with the plan in the DP. The Skygarden building opened in 1990. (1971) 124 CLR 73 at 77-78. See also the remarks of Connolly J in Hutchinson v Lemon [1983] 1 Qd R 369 at 372-373. Kirby Hayne The Council had adopted a building code which at the time of construction of Glasshouse provided for the award of bonus floor space to encourage developers to supply elements of the pedestrian network favoured by the Council. The terms of a condition imposed by the development approval by the Council for Glasshouse have been the subject of separate litigation between Perpetual, Westfield and the Council. An application by Perpetual for special leave to appeal to this Court against the decision of the New South Wales Court of Appeal in that litigation4 was heard with the present appeal, but was dismissed5. At the time of the creation of the Easement in 1988, all four parcels of land had been in separate ownership. In recent years Westfield has acquired, in addition to the Skygarden site, the land upon which stand the commercial developments known as "Imperial Arcade" and "Centrepoint". Imperial Arcade adjoins Skygarden, and Centrepoint adjoins Imperial Arcade. Both Imperial Arcade and Centrepoint front the Pitt Street Mall. Westfield proposes to redevelop together all three sites. It wishes to utilise for that redevelopment the right of way under Glasshouse so as to enable vehicular access from King Street. The litigation By summons filed in the Equity Division of the Supreme Court of New South Wales, Westfield sought against Perpetual a declaration that the Easement permitted Westfield, as owner of Skygarden, to allow persons or vehicles to use the driveway to continue over (or more accurately, under) Skygarden to access driveways, parking spaces and loading docks to be built on the Imperial Arcade or Centrepoint sites. Brereton J granted declaratory relief to the effect of that sought by Westfield6. The Court of Appeal (Beazley, Hodgson and Tobias JJA) allowed an appeal by Perpetual7 and set aside the orders of Brereton J. The principal reasons of the Court were delivered by Hodgson JA. [2006] NSWCA 245. [2007] HCATrans 367 at 5520-5540. [2006] NSWSC 716. (2006) 12 BPR 23,793. Kirby Hayne Westfield appeals to this Court, seeking to reinstate the decision of the primary judge. For the reasons that follow the appeal should be dismissed. The terms of the Easement It is appropriate to begin with the terms of the Easement as they appear in the Instrument. What are identified as eleven conditions of the "right of carriageway" are set out. It will be necessary to refer to some of these conditions later in these reasons. It is the terms of the opening words of the Instrument which are of immediate importance. They state: "Full and free right of carriageway for the grantee its successors in title and registered proprietors for the time being of an estate or interest in possession of the land herein indicated as the lots benefited or any part thereof with which the rights shall be capable of enjoyment and every person authorised by it, to go, pass and repass at all times and for all purposes with vehicles to and from the said lots benefited or any such part thereof across the lots burdened". (emphasis added) This form of words has an affinity to that which, since the commencement in 1931 of the Conveyancing (Amendment) Act 1930 (NSW) ("the 1930 Act"), has been the effect given by s 181A of the Conveyancing Act8 to the creation of a right of way using the expression "right of carriageway". Section 181A extends to dealings under the RP Act (s 181A(4)). The meaning given to the expression "right of carriageway" by the statute may be varied by the instrument in which it is used (s 181A(3)). The words otherwise read in by the statute are as follows: "Full and free right for every person who is at any time entitled to an estate or interest in possession in the land herein indicated as the dominant tenement or any part thereof with which the right shall be capable of enjoyment, and every person authorised by that person, to go, pass and repass at all times and for all purposes with or without animals or vehicles or both to and from the said dominant tenement or any such part thereof." The phrases "to go, pass and repass at all times and for all purposes ... to and from the said dominant tenement ['lots benefited'] or any such part thereof" appear in both the statute and the Instrument. However, for the Easement the activities permitted with respect to the servient tenement (Glasshouse) are 8 With Sched 8, Pt 1. Kirby Hayne "across the lots burdened", an expression not found in the statutory formulation. This expression is apt to describe entry from King Street, and passage across the Glasshouse site of the servient tenement to reach Skygarden as the destination. What is significant for the present dispute is that the Easement does not also speak of activities "across" rather than "to and from" the dominant tenement (Skygarden). In that regard, Hodgson JA, who gave the leading reasons for judgment in the Court of Appeal, remarked9: "Although the words 'to and from [the dominant tenement] or any such part thereof' do not exclude the possibility that the right should extend to going to the dominant tenement and then going across it to further land, and then returning across the dominant tenement and then going from it across the servient tenement, the words tend to suggest that it is access to and from the dominant tenement that is the purpose of the [E]asement, and not access to further land reached only by going across the dominant tenement. Certainly, if it had been intended that the grant extend to the authorisation of others to go across the dominant tenement to further properties, the words 'and across' could readily have been added." (emphasis in original) We agree. "[F]or all purposes" In its submissions, Westfield stressed the significance for the construction of the Instrument of the phrase therein "for all purposes". This was said to be plainly apt to encompass the purpose of accessing Skygarden, the dominant tenement, and from there travelling to some further property. The phrase "for all purposes" appears also in the statutory formulation which has been included in the Conveyancing Act since the commencement of the 1930 Act. Before 1930 it had appeared in easements the construction of whose terms had come before the courts. One such case was Thorpe v Brumfitt10. There, a grant of a right of way "for all purposes" across the servient tenement did not plainly identify any (2006) 12 BPR 23,793 at 23,811. Kirby Hayne dominant tenement. Did the grant fail as being an attempt to create an easement in gross11? As a matter of construction James LJ and Mellish LJ avoided that result. Mellish LJ12 construed the phrase "for all purposes" as identifying all purposes which made it necessary to pass between the servient tenement and a triangular parcel of land indicated in the conveyance creating the easement13. This decision is significant in two respects. First, it illustrates the importance of the legislative requirement imposed in New South Wales by s 88 of the Conveyancing Act (also introduced by the 1930 Act) for identification of the lands comprising the dominant and servient tenements. Secondly, it emphasises that the "purposes", extensive as they may be, must confer what the law regards as a benefit on the dominant tenement, by making it "a better and more convenient property"; this is something more than a "personal advantage" to the owner of the tenement for the time being14. More recently, in Peacock v Custins15 the English Court of Appeal considered the phrase "a right of way at all times and for all purposes" in favour of the dominant tenement ("the red land") the owners of which also owned adjacent land ("the blue land"). After reviewing many authorities, including Harris v Flower16, Schiemann LJ (delivering the judgment of the Court also comprising Mance LJ and Smith J) concluded that the terms of the grant did not permit the extended user in favour of the blue land and, further, that this user could not reasonably be described as "ancillary" to the use of the red land17. 10 (1873) LR 8 Ch App 650. 11 As had been the outcome in Ackroyd v Smith (1850) 10 CB 164 [138 ER 68], an authority analysed in Megarry and Wade, The Law of Real Property, 6th ed (2000) at 1080-1081 [18-047]. See also the decision of the English Court of Appeal in Voice v Bell (1993) 68 P & CR 441 at 444-445. 12 (1873) LR 8 Ch App 650 at 657-658. 13 See Todrick v Western National Omnibus Co Ltd [1934] Ch 561 at 583-585. 14 Megarry and Wade, The Law of Real Property, 6th ed (2000) at 1080 [18-045]. 15 [2002] 1 WLR 1815; [2001] 2 All ER 827. 16 (1904) 74 LJ Ch 127. 17 [2002] 1 WLR 1815 at 1824; [2001] 2 All ER 827 at 836. Kirby Hayne The reference in Peacock v Custins18 to user which could be described as "ancillary" to the grant appears to have identified the line of cases holding that, on general principles of conveyancing, the grant of an easement carries with it those ancillary rights which are necessary for the enjoyment of the rights expressly granted19. For example, Warner J held in National Trust for Places of Historic Interest or Natural Beauty v White20 that use by visitors of a car park adjacent to an Iron Age hill fort in Wiltshire known as the Figsbury Ring was an "ancillary" user in the required sense. However, it is not necessary for the enjoyment of the rights granted for access to the Skygarden land that those using that access be at liberty to pass beyond Skygarden to other land. It should be added that if the construction of the Instrument urged by Westfield were accepted, and the grant extended to permit use of Glasshouse to pass across Skygarden to other parcels of land, then a further question would arise. This would be whether a grant in those terms would be appurtenant to Skygarden in the sense of the authorities, or be but a personal advantage accruing to Westfield as the present owner of Skygarden. It is unnecessary to determine such a question. This is because the Easement, upon the proper construction of the terms of the grant, does not extend to user of the type for which Westfield contends. The most recent edition of Gale on Easements21 states: "The general rule is that a right of way may only be used for gaining access to the land identified as the dominant tenement in the grant." There follows a detailed analysis of the English authorities, which begins with remarks to that effect by Romer LJ in Harris v Flower22. 18 [2002] 1 WLR 1815 at 1824; [2001] 2 All ER 827 at 836. See also Thomas v Mowbray [2007] HCA 33 at [25]. 19 Gale on Easements, 17th ed (2002) at 47 [1-81]. 20 [1987] 1 WLR 907. 21 17th ed (2002) at 334 [9-27]. 22 (1904) 74 LJ Ch 127 at 132. Kirby Hayne The decision in that case has been much discussed in later authorities both in England and Australia, a number of which were reviewed by Brereton J at first instance. His Honour concluded that Harris v Flower stands for the proposition that: "use of an easement cannot be extended, beyond the scope of the grant, to impose a burden greater than that which the servient owner agreed to accept". That statement accords with the following analysis of Harris v Flower which is offered in Gale on Easements and which we would adopt23: "In Harris v Flower & Sons the excessive user by which it was attempted to impose an additional burden on the servient tenement consisted in the use of a right of way for obtaining access to buildings erected partly on the land to which the right of way was appurtenant and partly on other land. A claim was put forward on behalf of the plaintiffs that the right of way had been abandoned, on the ground that, as it was practically impossible to separate the lawful from the excessive user, the right of way could not be used at all. This contention failed, however, the court holding that there had been no abandonment, but that the user of the way for access to the buildings so far as they were situate upon land to which the right of way was not appurtenant was in excess of the rights of the defendants, and a declaration was made accordingly, with liberty to apply." (footnote omitted) However, Brereton J went on to hold: "It is not in excess of the grant to use a right of way to access the dominant tenement for those purposes that were contemplated at the time of the grant." The difficulty is in the phrase "that were contemplated". Contemplated by whom? By what evidentiary means is this contemplation later to be revealed to the court? How do these steps accommodate the Torrens system? To these matters it will be necessary to return. 23 17th ed (2002) at 470 [12-79]. Kirby Hayne At this stage in the reasons it is important to remark that care certainly must be taken lest the statement in Gale on Easements set out above be elevated to the status of a "rule", whether of construction or substantive law. What the statement does provide is a starting point for consideration of the terms of any particular grant. The statement is consistent with an understanding that the broader the right of access to the dominant tenement granted by the easement, the greater the burden upon the proprietary rights in the servient tenement. We return to the terms of the Easement. The access is to go, pass and repass to and from Skygarden and across Glasshouse. The terms do not speak of going, passing and repassing to and from and across Skygarden, and across Glasshouse. The term "for all purposes" encompasses all ends sought to be achieved by those utilising the Easement in accordance with its terms. The conditions Something more here should be said respecting the set of conditions set out in the Instrument. Clauses (3) and (4) of the conditions are in the following terms: "(3) Subject to Clause (4) the cost of routine maintenance and repair to the site of the carriageway shall be borne equally between the grantor and grantee. The cost of repair of damage caused to the site of the carriageway (including all structures, equipment, fixtures and fittings erected or positioned on or over the boundaries of the carriageway which boundaries are shown in the above mentioned plan) by the grantor or grantee, their respective servants or agents shall be borne by such grantor or grantee PROVIDED HOWEVER that in any other case the cost of repair shall be borne equally between the grantor and grantee." In the absence of further clear words it might be considered unduly burdensome upon the owner for the time being of Glasshouse that it meet one half of the costs associated with access to remoter lots. That no such further provision was made is consistent with the construction adopted in these reasons of the terms of the grant of the Easement. Further, cl (4) attributes responsibility to the respective parties for the costs of repair of damage caused to the site of the carriageway by the grantor or grantee, and otherwise provides for them to bear equally the costs of repair. No attention has been given to the costs of repairs occasioned by those utilising the Easement to pass across and beyond Skygarden. Kirby Hayne Clauses (7) and (8) are as follows: "(7) The grantor and grantee shall at their own cost separately insure and keep insured at all times during the life of the right of carriageway the structure of the carriageway and all associated fixtures and fittings (including but not limited to signage) for loss or damage thereto arising as a direct result of their respective use of the carriageway. The grantor and grantee shall at their own cost separately effect and maintain at all times during the life of the right of the carriageway public risk insurance covering their respective legal liability to third parties (including the other party) for property damage and bodily injury arising out of their respective use of the carriageway." No provision is made for insurance against loss or damage arising as a result of use of Glasshouse by the owners for the time being of tenements beyond the boundary of Skygarden. Nor is the obligation to effect public risk insurance so drawn as to deal with the range of uses for which Westfield contends. The same may be said of the limited indemnity required by cl (9). This reads: "(9) The grantee shall indemnify and keep indemnified the grantor against all actions, claims, suits, demands and losses arising from any default act or omission of the grantee its servants or agents in the use of the right of carriageway." On this point, Hodgson JA remarked (and we agree)24: "[I]f Skygarden could authorise Imperial Arcade and Centrepoint to use the right of way for access to their premises, it seems anomalous that Glasshouse should be required to submit to this where there is no requirement for Imperial Arcade and Centrepoint to maintain insurance, along the lines provided in cll (7) and (8) of the [E]asement. It would also be anomalous that there was no indemnity from Imperial Arcade and Centrepoint of the kind provided in cl (9) of the [E]asement." Extrinsic material 24 (2006) 12 BPR 23,793 at 23,811. Kirby Hayne In going on to allow the appeal, Hodgson JA (again correctly) remarked that the decision of the primary judge appeared to be the product of an error in preparedness to look for the intention or contemplation of the parties to the grant of the Easement outside what was manifested by the terms of the grant. Extensive evidence of that nature had been led by Westfield on affidavit with supporting documentation. In this Court, counsel for Perpetual submitted that some but not all of the extrinsic evidence had been admissible; in particular, the evidence said to supply part of the "factual matrix" but which post-dated a deed dated 26 February 1988 containing a covenant to grant the Easement was inadmissible. So also was said to be evidence of the subjective intention of the then owner of Glasshouse which had not been communicated to the then owner of Skygarden. Perpetual accepted that what had been admissible was evidence of a preceding oral agreement between those parties: this had been to the effect that the Easement was to permit access to Skygarden via Glasshouse. However, in the course of oral argument in this Court it became apparent that what was engaged by the submissions respecting the use of extrinsic evidence of any of those descriptions, as an aid in construction of the terms of the grant, were more fundamental considerations. These concern the operation of the Torrens system of title by registration, with the maintenance of a publicly accessible register containing the terms of the dealings with land under that system. To put the matter shortly, rules of evidence assisting the construction of contracts inter partes, of the nature explained by authorities such as Codelfa Construction Pty Ltd v State Rail Authority of NSW25, did not apply to the construction of the Easement. Recent decisions, including Halloran v Minister Administering National Parks and Wildlife Act 197426, Farah Constructions Pty Ltd v Say-Dee Pty Ltd27, and Black v Garnock28, have stressed the importance in litigation respecting title 25 (1982) 149 CLR 337 at 350-352. 26 (2006) 80 ALJR 519 at 526 [35]; 224 ALR 79 at 88. 27 (2007) 81 ALJR 1107 at 1150-1152 [190]-[198]; 236 ALR 209 at 266-269. 28 (2007) 237 ALR 1 at 4 [10]. Kirby Hayne to land under the Torrens system of the principle of indefeasibility expounded in particular by this Court in Breskvar v Wall29. The importance this has for the construction of the terms in which easements are granted has been remarked by Gillard J in Riley v Penttila30 and by Everett J in Pearce v City of Hobart31. The statement by McHugh J in Gallagher "[t]he principles of construction that have been adopted in respect of the grant of an easement at common law ... are equally applicable to the grant of an easement in respect of land under the Torrens system", is too widely expressed. The third party who inspects the Register cannot be expected, consistently with the scheme of the Torrens system, to look further for extrinsic material which might establish facts or circumstances existing at the time of the creation of the registered dealing and placing the third party (or any court later seized of a dispute) in the situation of the grantee33. It is true that in Overland v Lenehan34 Griffith CJ admitted extrinsic evidence to show a misdescription of the boundaries of the land comprised in a certificate of title. This is a matter now dealt with in the RP Act by the provisions in Pt 15 (ss 136-138) for the cancellation and correction of instruments. Subsequently, in Powell v Langdon35 Roper J accepted as applicable to the construction of a particular grant of a right of way (apparently over land under the RP Act) a statement by Sir George Jessel MR in Cannon v 29 (1971) 126 CLR 376. See also Figgins Holdings Pty Ltd v SEAA Enterprises Pty Ltd (1999) 196 CLR 245 at 264 [26]-[27]. 30 [1974] VR 547 at 573. 31 [1981] Tas R 334 at 349-350. 32 (1994) 179 CLR 624 at 639-640. 33 cf Proprietors Strata Plan No 9,968 v Proprietors Strata Plan No 11,173 [1979] 2 NSWLR 605 at 610-612. 34 (1901) 11 QLJ 59 at 60. 35 (1944) 45 SR (NSW) 136 at 137. Kirby Hayne Villars36. This was that the content of the bare grant of a right of way per se was to be ascertained by looking to the circumstances surrounding the execution of the instrument, including the nature of the surface over which the grant applied. The situation with which the Australian courts were concerned in the above cases bore little resemblance to that in the present case, where the evidence goes to the intentions and expectations of the parties to the Instrument respecting the development of an area in the central business district of Sydney. To some degree the attraction of "the common law approach to the construction of grants of easement"37 has been to counter arguments that a right of way may be used only for the purposes for which the way was used at the time of the grant. But to accept the proposition that the user under a registered easement may change with the nature of the dominant tenement, so long as the terms of the grant are sufficiently broad38, does no violence to the principles of the Torrens system. Subsequent changes in circumstances may found an application under s 89 of the Conveyancing Act for modification or extinguishment39. The conduct of the immediate parties to a dispute may found a personal equity of the kind considered in Mayer v Coe40 and accepted in Breskvar v Wall41, and also may bear upon a claim for injunctive relief, as Kearney J indicated in Andriopoulos v Marshall42. But this was not what was involved in the significance attached by the primary judge to the evidence of what may or may not have been in the contemplation of Jamino and Mastwood, or their affiliates and advisors, at or before the grant of the Easement in 1988. These matters were used to guide, if not control, the construction of what appeared on the Register. 36 (1878) 8 Ch D 415 at 420. 37 Grinskis v Lahood [1971] NZLR 502 at 508. 38 Megarry and Wade, The Law of Real Property, 6th ed (2000) at 1153-1154 39 An example is Treweeke v 36 Wolseley Road Pty Ltd (1973) 128 CLR 274. 40 (1968) 88 WN (Pt 1) (NSW) 549. 41 (1971) 126 CLR 376 at 387. 42 (1981) 2 BPR 9391. Kirby Hayne It may be accepted, in the absence of contrary argument, that evidence is admissible to make sense of that which the Register identifies by the terms or expressions found therein. An example would be the surveying terms and abbreviations which appear on the plan found in this case on the DP. But none of the foregoing supports the admission in this case of evidence to establish the intention or contemplation of the parties to the grant of the Easement. Conclusion and orders The appeal fails and should be dismissed with costs.

HIGH COURT OF AUSTRALIA COMCARE AND APPELLANT RESPONDENT [2016] HCA 43 9 November 2016 ORDER Appeal allowed. Set aside the orders of the Full Court of the Federal Court of Australia made on 30 November 2015, except insofar as order 2 sets aside order 5 of Griffiths J made on 8 January 2015, and in their place order that the appeal be otherwise dismissed. The appellant pay the respondent's reasonable costs of the appeal to this Court and of the proceedings before Griffiths J and in the Full Court of the Federal Court of Australia. On appeal from the Federal Court of Australia Representation T M Howe QC with A P Berger for the appellant (instructed by Lehmann Snell Lawyers) L King SC with L T Grey for the respondent (instructed by Maurice Blackburn Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Workers compensation – Safety, Rehabilitation and Compensation Act 1988 (Cth), s 5A(1) – Meaning of injury – Where employee suffered aggravation of mental condition in reaction to perceived consequence of failure to obtain promotion – Whether aggravation suffered "as a result of" reasonable administrative action. Words and phrases – "as a result of", "'common sense' approach to causation", "disease", "injury". Safety, Rehabilitation and Compensation Act 1988 (Cth), ss 5A, 5B. FRENCH CJ, BELL, GAGELER, KEANE AND NETTLE JJ. This appeal concerns the causal connection required to meet the exclusion from the Safety, Rehabilitation and Compensation Act 1988 (Cth) ("the Act") of an injury suffered by an employee "as a result of" reasonable administrative action. The causal connection was met in circumstances where an employee suffered an aggravation of a mental condition in reaction to a perceived consequence of her failure to obtain a promotion. The Act The Act makes Comcare liable to pay compensation in respect of an "injury" suffered by an employee if that injury results in incapacity for work1. As the Act stood in 2012, after amendment by the Safety, Rehabilitation and Compensation and Other Legislation Amendment Act 2007 (Cth) ("the Amending Act"), "injury" had the meaning given by s 5A and "disease" had the meaning given by s 5B. Section 5A provided: In this Act: injury means: a disease suffered by an employee ... but does not include a disease ... suffered as a result of reasonable administrative action taken in a reasonable manner in respect of the employee's employment. For the purposes of subsection (1) and without limiting that subsection, reasonable administrative action is taken to include the following: 1 Section 14(1). anything reasonable done in connection with the employee's failure to obtain a promotion, reclassification, transfer or benefit, or to retain a benefit, in connection with his or her employment." Bell Nettle Section 5B provided: In this Act: disease means: an ailment suffered by an employee; or an aggravation of such an ailment; that was contributed to, to a significant degree, by the employee's employment by the Commonwealth or a licensee. In this Act: significant degree means a degree that is substantially more than material." The Act defined "ailment" to mean "any physical or mental ailment, disorder, defect or morbid condition (whether of sudden onset or gradual development)" and defined "aggravation" to include "acceleration or recurrence"2. For the purposes of the Act, an employee was taken to have sustained an injury constituted by a disease or an aggravation of a disease on the day of the first to occur of: the employee first seeking medical treatment for the disease or the aggravation; or the disease or the aggravation resulting in incapacity for work3. The facts Ms Martin was employed by the Australian Broadcasting Corporation. She was initially appointed in 2010 to a position as producer of a local morning radio program in Renmark in South Australia. In that position, she was under the direct supervision of Mr Bruce Mellett, who presented the program. 2 Section 4(1). 3 Section 7(4). Bell Nettle Ms Martin did not have a good working relationship with Mr Mellett. Mr Mellett evidently thought aspects of Ms Martin's work unsatisfactory. Ms Martin thought Mr Mellett bullying and harassing and thought their working environment "toxic". Mr Mellett denied Ms Martin's allegations of bullying and harassment and when she later made a formal complaint her allegations were found by management to be unsubstantiated. Ms Martin attempted to remove herself from Mr Mellett's supervision. She applied for a number of positions outside Renmark, but was unsuccessful. Then, in 2011, still holding the substantive position of producer of the local morning radio program and still based in Renmark, Ms Martin was appointed to act temporarily in the higher position of cross media reporter. In that position, Ms Martin was supervised by Ms Carol Raabus, who was based in Hobart. The position of cross media reporter in which Ms Martin was acting was advertised for permanent appointment in 2012. Ms Martin applied. Her main reason for applying was to avoid having to work again under Mr Mellett's direct supervision. Ms Martin was interviewed for the permanent position of cross media reporter by a selection panel which was chaired by Ms Raabus and which included Mr Mellett. The selection panel decided not to appoint Ms Martin to the permanent position. Ms Raabus informed Ms Martin in a telephone conversation that she had not been appointed. Their conversation then turned to Ms Martin returning to her substantive position as producer of the local morning radio program under the supervision of Mr Mellett. Ms Martin at that point, in her words, "broke down uncontrollably". She immediately went home. The next day, she sought medical treatment. Ms Martin was diagnosed as suffering from an "adjustment disorder", which rendered her unfit for work. After Comcare refused her claim for compensation, Ms Martin appealed the merits of Comcare's decision to the Administrative Appeals Tribunal. The Tribunal There was no dispute before the Tribunal that Ms Martin suffered a disease within the meaning of s 5B(1). The Tribunal identified her disease as an adjustment disorder, appropriately described as a mental condition, and therefore as an ailment within s 5B(1)(a). Bell Nettle The Tribunal found that Ms Martin was probably suffering from an adjustment disorder during the period in which she was acting in the position of cross media reporter. The Tribunal found that her mental condition deteriorated significantly when she was notified that she had not been appointed to the position of cross media reporter4. Ms Martin relied on the deterioration as constituting the injury which gave rise to her incapacity for work and which founded her claim to compensation. On the findings it made, the Tribunal should have identified Ms Martin's disease as the significant deterioration of her adjustment disorder, and therefore as an aggravation of an ailment within s 5B(1)(b). But nothing turns on that minor misidentification. What is important is that there was no dispute before the Tribunal that the deterioration of Ms Martin's adjustment disorder was contributed to, to a significant degree, by her employment. Just how her employment contributed to that deterioration was the subject of psychiatric evidence, albeit that the evidence was adduced in the context of another dispute. That dispute was about whether the disease within the meaning of s 5B(1) which Ms Martin suffered was excluded from the definition of injury in s 5A(1). Comcare contended, and Ms Martin disputed, first that the deterioration of her mental condition was suffered "as a result of" the decision not to appoint her to the position of cross media reporter and second that the decision not to appoint her answered the description of reasonable administrative action taken in a reasonable manner. In response to the first of those contentions of Comcare, Ms Martin contended as a matter of fact that "the worsening of her condition was caused by her realisation that she would be returning to the supervision of Mr Mellett, a prospect she dreaded, and any contribution caused by her disappointment with the loss of an opportunity for career advancement was immaterial"5. That fact, Ms Martin contended, was sufficient in law for the Tribunal to conclude that the deterioration of her mental condition was not suffered "as a result of", within the meaning of s 5A(1), the decision not to appoint her to the position of cross media reporter. 4 Martin v Comcare (2014) 64 AAR 224 at 231 [37], 231-232 [42]. 5 Martin v Comcare (2014) 64 AAR 224 at 233 [51]. Bell Nettle In the result, the Tribunal accepted Ms Martin's contention of fact but rejected her contention of law. Making findings of fact, the Tribunal adopted the opinion of two psychiatrists who gave evidence before it. That opinion was that what caused Ms Martin to "decompensate" when notified by Ms Raabus that she had not been appointed to the position of cross media reporter was Ms Martin's "realisation" that the decision not to so appoint her meant that she would be returning to her substantive position under Mr Mellett's supervision, where the bullying and harassment which she felt that she had experienced would continue. Any contribution arising from her disappointment at the loss of the opportunity to advance her career through appointment to the permanent position of cross media reporter, the Tribunal accepted, was so minor as to be immaterial6. "A number of consequences flowed from Ms Martin's failure to obtain the promotion to the position of cross media producer. These included: Ms Martin would be required to return to her substantive position and work under the direct supervision of Mr Mellett; and Ms Martin would be denied a small pay increase and the opportunity in cross media production." to further develop her skills "The question posed by s 5A(1) is whether the claimed ailment was suffered as a result of the nominated action, in this case the failure to the anticipated obtain consequences of the offending decision was most likely to have troubled Ms Martin. That her reaction to the offending decision was primarily attributable to her dread of returning to work under Mr Mellett and not her It matters not which of the promotion. 6 Martin v Comcare (2014) 64 AAR 224 at 234 [56], 234-235 [58]. 7 Martin v Comcare (2014) 64 AAR 224 at 235 [60]. 8 Martin v Comcare (2014) 64 AAR 224 at 235 [61]. Bell Nettle disappointment with lack of career advancement, is irrelevant. In her mind the former was a direct and foreseeable consequence of the decision." The Tribunal was satisfied on that basis "that one of the operative causes of Ms Martin's adjustment disorder was her failure to obtain the position of cross media reporter" and concluded that "Ms Martin's condition was 'a result of' that action"9. The Tribunal nevertheless went on to conclude that Mr Mellett's participation in the decision-making process resulted in the decision not to appoint Ms Martin to the position of cross media reporter not having been taken in a reasonable manner. The consequence was that the exclusion from the definition of injury in s 5A(1) had no application despite the causal connection between the identified administrative action and the suffering of the identified disease being met. The Tribunal decided accordingly that Ms Martin had suffered an injury within the meaning of s 5A(1) for which Comcare was liable to pay compensation. The Federal Court Comcare appealed to the Federal Court. That appeal was limited to questions of law10. Comcare challenged the Tribunal's conclusion that the decision not to appoint Ms Martin to the position of cross media reporter was not taken in a reasonable manner. Ms Martin by notice of contention challenged the Tribunal's conclusion that she suffered her disease as a result of that decision. The primary judge was Griffiths J11. Finding that the Tribunal's conclusion, that the decision not to appoint Ms Martin to the position of cross media reporter was not taken in a reasonable manner, was affected by error of law, his Honour allowed Comcare's appeal. Finding no legal error in the Tribunal's conclusion that Ms Martin suffered her disease as a result of that decision, his Honour dismissed Ms Martin's notice of contention. As a consequence of allowing the appeal, his Honour made orders setting aside the 9 Martin v Comcare (2014) 64 AAR 224 at 235 [62]. 10 Section 44 of the Administrative Appeals Tribunal Act 1975 (Cth). 11 Comcare v Martin (2015) 148 ALD 312. Bell Nettle decision of the Tribunal and remitting the matter to the Tribunal to be heard and determined according to law. Ms Martin appealed to the Full Court. Ms Martin challenged the conclusion of Griffiths J that the Tribunal erred in law in concluding that the decision not to appoint her to the position of cross media reporter was not taken in a reasonable manner, leading to his allowing of Comcare's appeal. Ms Martin also challenged the conclusion of Griffiths J that the Tribunal did not err in law in concluding that the disease she suffered was a result of that decision, leading to his dismissal of her notice of contention. Ms Martin's notice of appeal to the Full Court framed her challenge to the dismissal of her notice of contention as follows: "The primary judge erred in dismissing [Ms Martin's] notice of contention, when on the correct construction of s 5A(1) and the primary factual findings made by the Tribunal (congruent with the opinions of both psychiatrists who gave evidence), [Ms Martin's] adjustment disorder was not a result of the failure of [Ms Martin] to obtain the promotion for which she had applied, but a result of the fact that she was to be sent back to work under the supervision of Mr Mellett, whom she identified as the principal source of the bullying and harassment she believed she had earlier suffered in the course of her work." The Full Court comprised Siopis, Flick and Murphy JJ. The Full Court was unanimous in rejecting Ms Martin's challenge to the allowing of Comcare's appeal from the decision of the Tribunal. The Full Court divided on the outcome of Ms Martin's challenge to the dismissal of her notice of contention. The majority, Siopis and Murphy JJ, upheld that challenge, leading them to allow the The reasoning of the majority was set out in the reasons for judgment of Murphy J, with whom Siopis J agreed. His Honour construed the phrase "as a result of" in s 5A(1) as requiring the application of a "common sense" approach to causation12. The Tribunal, according to his Honour, misconstrued that phrase in a way that led it to fail to apply common sense to the facts as it found them: it 12 Martin v Comcare (2015) 238 FCR 373 at 396 [108]-[110]. Bell Nettle confused consequence with causation, and considered itself permitted to treat as causative an event which was no more than chronologically precedent13. Murphy J also found fault with the Tribunal's fact finding. First, he considered that there was no evidence which permitted the Tribunal to find that Ms Martin believed that returning to work in her substantive position under the supervision of Mr Mellett was a direct and foreseeable consequence of the decision not to appoint her to the position of cross media reporter14. Second, he considered that the Tribunal was wrong to approach the issue of causation on the assumption that Ms Martin being returned to her substantive position was an inevitable consequence of the failure to promote her. He suggested instead that it was "likely that there was an intervening administrative action (such as making the further decision that she was to revert to working under the supervision of Mr Mellett, informing her of that decision or maintaining the decision to return Ms Martin to Mr Mellett's supervision when Ms Raabus was made aware of Ms Martin's concerns regarding him)"15. The Full Court made orders allowing the appeal, setting aside the orders made by Griffiths J, and remitting the matter to the Tribunal to be determined according to the law as explained in the reasoning of the majority. The appeal to this Court Comcare appeals, by special leave, to this Court. Comcare argues that Murphy J proceeded on an erroneous view of the causal connection required to meet the exclusion in s 5A(1). The Tribunal, Comcare argues, was correct in law to conclude on the facts it found that the causal connection was met. Further, Comcare argues, Murphy J went beyond the role of the Federal Court in an appeal from the Tribunal to the extent that he found fault with the Tribunal's fact finding. The Tribunal's findings of fact were not challenged in the appeal. The findings of fact were, in any event, supported by evidence and on that basis incapable of being disturbed in an appeal limited to a question of law. 13 Martin v Comcare (2015) 238 FCR 373 at 399-400 [120]-[125]. 14 Martin v Comcare (2015) 238 FCR 373 at 399-400 [120(c)]. 15 Martin v Comcare (2015) 238 FCR 373 at 400 [122]. Bell Nettle Even if Murphy J were correct in suggesting the likelihood of other administrative action intervening to result in Ms Martin reverting to work under the supervision of Mr Mellett, Comcare argues, that other administrative action is likely itself to have been reasonable administrative action within s 5A(1). That is because the other administrative action is likely to have fallen within the wide description in s 5A(2)(f) of "anything reasonable done in connection with [Ms Martin's] failure to obtain [the] promotion". Ms Martin supports the reasoning of Murphy J. She argues that the possible application of s 5A(2)(f) to other administrative action was not explored in the evidence before the Tribunal and cannot be raised for the first time in this Court. Isolating the issue of principle Comcare's case before the Tribunal proceeded on the basis that the reasonable administrative action as a result of which Ms Martin suffered a worsening of her mental condition was the decision not to appoint her to the position of cross media reporter. That was the case which the Tribunal considered. The issue of causation that case raised was limited to whether, within the meaning of s 5A(1), the worsening of Ms Martin's condition was as a result of that administrative action. Comcare's belated invocation of s 5A(2)(f) as extending to other possible administrative action is a distraction. Whether Ms Martin's return to her substantive position as producer of the morning program was or was not in fact an inevitable consequence of the administrative action constituted by the decision not to appoint her to the position of cross media reporter similarly distracts from the critical finding of the Tribunal on the issue of causation that was raised for its determination. The critical finding of the Tribunal was that returning to her substantive position was a direct and foreseeable consequence of the decision in Ms Martin's mind. The deterioration of her mental condition, on the Tribunal's finding, was triggered by her contemplation of what she perceived to be a consequence of the decision. The Full Court had no basis for questioning that finding, let alone for considering that finding not to have been open on the evidence. Not only was the finding consistent with the opinions of the two psychiatrists who gave evidence, it was the finding which Ms Martin asked the Tribunal to make. The finding was unchallenged on the appeal to the Federal Court and its correctness was assumed Bell Nettle in the framing of Ms Martin's ground of appeal to the Full Court challenging the dismissal of her notice of contention by Griffiths J. That leaves a single issue of principle to be resolved on the facts found by the Tribunal. The issue is whether the Tribunal was correct in law to conclude that the deterioration of Ms Martin's mental condition triggered by her contemplation of a perceived consequence of the decision was a disease which she suffered as a result of that decision within the meaning of s 5A(1). Resolving the issue of principle Causation in a legal context is always purposive16. The application of a causal term in a statutory provision is always to be determined by reference to the statutory text construed and applied in its statutory context in a manner which best effects its statutory purpose17. It has been said more than once in this Court that it is doubtful whether there is any "common sense" approach to causation which can provide a useful, still less universal, legal norm18. Nevertheless, the majority in the Full Court construed the phrase "as a result of" in s 5A(1) as importing a "common sense" notion of causation. That construction, with respect, did not adequately interrogate the statutory text, context and purpose. Within a statutory context which includes ss 5A and 5B, the exclusionary phrase "as a result of" in s 5A(1) is naturally read, not as imposing its own separate and free-standing test of causation, but rather as referring relevantly to the test of causation spelt out in s 5B(1). The application of the definition of disease in s 5B(1) means that, to have suffered a disease falling within s 5A(1)(a), the employee must have suffered an ailment or aggravation of an ailment that was contributed to, to a significant degree, by the employee's employment. In excluding from the definition of an 16 Legal Services Board v Gillespie-Jones (2013) 249 CLR 493 at 530 [137]; [2013] HCA 35. 17 Travel Compensation Fund v Tambree (2005) 224 CLR 627 at 639 [28]; [2005] HCA 69. See also Allianz Australia Insurance Ltd v GSF Australia Pty Ltd (2005) 221 CLR 568 at 582 [42]; [2005] HCA 26. 18 Travel Compensation Fund v Tambree (2005) 224 CLR 627 at 642 [45], citing Allianz Australia Insurance Ltd v GSF Australia Pty Ltd (2005) 221 CLR 568 at Bell Nettle injury compensable under the Act a disease that is suffered by an employee "as a result of" reasonable administrative action taken in a reasonable manner in respect of the employee's employment, s 5A(1) is naturally read as referring to the contribution made to the suffering of the disease by an event in the course of the employee's employment which answers that description of reasonable administrative action. When the exclusionary phrase is so read, it becomes apparent that an employee has suffered a disease "as a result of" administrative action if the administrative action is a cause in fact of the disease which the employee has suffered. The administrative action need not be the sole cause. There may be multiple causes, some of which might even be related to other aspects of the What is necessary is that the taking of the employee's employment. administrative action is an event without which the employee's ailment or aggravation would not have been a disease: it would not have been contributed to, to a significant degree, by the employee's employment. That reading conforms to the purpose of the exclusion. The purpose was described in the explanatory memorandum to the Bill for the Amending Act as being to "ensure that the wide range of legitimate human resource management actions, when undertaken in a reasonable manner, do not give rise to eligibility for workers' compensation" and as including, in particular, to prevent claims "being used to obstruct legitimate management action by excluding claims where an injury (usually a psychological injury) has arisen as a result of" such action19. The taking of administrative action in respect of an employee's employment was in that way sought to be insulated from need for concern about the psychological effect of the decision on the employee. This purpose would be defeated if the operation of the exclusion were dependent upon the subjective psychological drivers of the employee's reaction. Having regard to the text and structure of ss 5A and 5B, and consistently with the statutory purpose of the exclusion in s 5A(1), what is required to meet the causal connection connoted by the exclusionary phrase in s 5A(1) in its application to a disease within s 5A(1)(a) is therefore that the employee would not have suffered that disease, as defined by s 5B(1), if the administrative action had not been taken. That is to say, the causal connection is met if, without the taking of the administrative action, the employee would not have suffered the 19 Australia, House of Representatives, Safety, Rehabilitation and Compensation and Other Legislation Amendment Bill 2006, Explanatory Memorandum at iv, v. Bell Nettle ailment or aggravation that was contributed to, to a significant degree, by the employee's employment. The causal connection giving rise to the exclusion from the definition of injury is met where the disease suffered by the employee is a mental condition or an aggravation of a mental condition suffered by the employee in reaction to a failure to obtain promotion, including in reaction to a perceived consequence of that failure to obtain promotion. The nature of the perceived consequence – whether personal or professional, direct or indirect, real or imagined – is beside the point. The reasoning of the Tribunal was correct in law on the findings of fact which it made. Orders The orders disposing of the appeal will have the effect of restoring the orders made by Griffiths J at first instance, except the order his Honour made in relation to costs. Those orders include that the matter be remitted to the Tribunal to be heard and determined according to law. Comcare accepts that Ms Martin will not be constrained on remitter by the prior findings of fact made by the Tribunal. In relation to costs, the orders will reflect the undertaking given by Comcare as a condition of the grant of special leave to appeal. The orders are: (1) Appeal allowed. Set aside the orders of the Full Court of the Federal Court of Australia made on 30 November 2015, except insofar as order 2 sets aside order 5 of Griffiths J made on 8 January 2015, and in their place order that the appeal be otherwise dismissed. The appellant pay the respondent's reasonable costs of the appeal to this Court and of the proceedings before Griffiths J and in the Full Court of the Federal Court of Australia.

HIGH COURT OF AUSTRALIA SIE SOK AND APPELLANT MINISTER FOR IMMIGRATION AND CITIZENSHIP & ANOR RESPONDENTS Sok v Minister for Immigration and Citizenship [2008] HCA 50 16 October 2008 ORDER Appeal allowed with costs. Set aside the orders of the Full Court of the Federal Court of Australia made on 5 March 2008 and 2 April 2008 and in their place order that the appeal to that Court be dismissed with costs. On appeal from the Federal Court of Australia Representation D S Mortimer SC with R M Niall for the appellant (instructed by Erskine Rodan & Associates) M A Perry QC with W S Mosley for the first respondent (instructed by Australian Government Solicitor) Submitting appearance for the second respondent Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Sok v Minister for Immigration and Citizenship Citizenship and migration – Visa – Spouse visa – Non-judicially determined claim of domestic violence – Grant of relevant permanent visa required visa applicant to remain spouse of sponsor at time of grant – Exception where relationship had ceased and visa applicant had suffered domestic violence committed by sponsoring spouse – Minister's delegate not satisfied applicant was spouse of sponsor – Grant of visa refused – After Minister's refusal, applicant claimed to have suffered domestic violence – Timing of claim – Whether domestic violence exception can be engaged where applicant first raises domestic violence claim in application to Migration Review Tribunal ("Tribunal") for review of Minister's refusal – Whether Div 1.5 of Migration Regulations 1994 (Cth) ("Regulations") applies to review by Tribunal or confines criteria for grant of visa to claims before original decision-maker. Citizenship and migration – Visa – Spouse visa – Non-judicially determined claim of domestic violence – Conduct of review by Tribunal – Tribunal to exercise powers and discretions conferred by Migration Act 1958 (Cth) ("Act") on Minister – Under Div 1.5 of Regulations, Minister must be satisfied applicant suffered domestic violence – If not satisfied, Minister must take opinion of independent expert as correct – Whether Tribunal can reach state of non- satisfaction without permitting applicant to appear before Tribunal to give evidence and present arguments under s 360 of Act – Whether review conducted in accordance with requirements of Div 5 of Pt 5 of Act – Whether opinion of independent expert dispositive. Words and phrases – "non-judicially determined claim of domestic violence", "not satisfied", "relevant domestic violence", "spouse". Migration Act 1958 (Cth), ss 348, 357A(1), 359, 360. Migration Regulations 1994 (Cth), reg 1.15A, Div 1.5, Sched 2 cl 100.221. GUMMOW, HAYNE, HEYDON, CRENNAN AND KIEFEL JJ. In 2002, the appellant, a citizen of Cambodia, married an Australian citizen. His wife sponsored his application for a temporary visa1 and a permanent visa2 permitting him to enter and remain in Australia. The temporary visa was granted and the appellant entered Australia in 2002. Subject to a qualification which, as will later appear, is of central importance in this case, one condition for the grant of the permanent visa for which the appellant applied is that, at the time the visa is granted, the visa applicant be the "spouse" of the sponsor. Regulation 1.15A of the Migration Regulations 1994 (Cth) ("the Regulations") identifies when, for the purposes of the Regulations, "a person is the spouse of another person". So far as presently relevant, that requires3 that the Minister be satisfied that the persons concerned 1 Partner (Provisional) (Class UF) visa Subclass 309 (Spouse (Provisional)). 2 Partner (Migrant) (Class BC) visa Subclass 100 (Spouse). 3 Regulation 1.15A(1) and (1A) provided: "(1) For the purposes of these Regulations, a person is the spouse of another person if the 2 persons are: in a married relationship, as described in subregulation (1A); in a de facto relationship, as described in subregulation (2). (1A) Persons are in a married relationship if: they are married to each other under a marriage that is recognised as valid for the purposes of the Act; and the Minister is satisfied that: they have a mutual commitment to a shared life as husband and wife to the exclusion of all others; and the relationship between them is genuine and continuing; and (iii) they: live together; or (Footnote continues on next page) Crennan "have a mutual commitment to a shared life as husband and wife to the exclusion of all others"4, that "the relationship between them is genuine and continuing"5, and that either6 they live together or "do not live separately and apart on a permanent basis". The qualification to the requirement that the visa applicant remain the "spouse" of the sponsor, which was said to be engaged in this case, is that, where the relationship between the applicant and the sponsor has ceased, the applicant will remain entitled to a permanent visa if, after the applicant first entered Australia as the holder of a relevant temporary visa, the applicant suffered domestic violence committed by the sponsoring spouse7. Two questions arise in this appeal. First, can this domestic violence qualification be engaged if the visa applicant first raises a claim of domestic violence in an application to the Migration Review Tribunal ("the Tribunal") for review of the refusal of the Minister's delegate to grant the visa sought? The second question concerns how the Tribunal is to conduct its review. The Tribunal is bound8 to invite an applicant for review "to appear before the Tribunal to give evidence and present arguments relating to the issues arising in relation to the decision under review". May the Tribunal decide that it is not satisfied that the alleged victim has suffered relevant domestic violence without do not live separately and apart on a permanent basis." reg 1.15A(1A)(b)(i). reg 1.15A(1A)(b)(ii). 7 Migration Regulations ("the Regulations"), Sched 2, (Cth) cl 100.221(4)(c)(i)(A). The Migration Amendment Regulations 2007 (No 13) (Cth) amended this clause and other provisions of the Regulations, including provisions of Div 1.5, by substituting the expression "family violence" for "domestic violence" and making a number of consequential amendments. Neither party suggested that anything turned on the alterations made in 2007. It is therefore convenient to continue to refer to the Regulations in the form in which they stood when the Tribunal was considering the matter. 8 Migration Act 1958 (Cth) ("the Act"), s 360. Crennan having permitted the applicant to appear before the Tribunal to give evidence and present arguments relating to that issue? Both questions should be answered in the sense urged by the appellant. The Tribunal must consider a claim of domestic violence, made by an applicant for a visa of the kind here in question, even though no such claim was made before the Minister refused to grant the visa sought. The Tribunal may not conclude that it is not satisfied that the alleged victim has suffered relevant domestic violence without first having invited the applicant for review to appear before the Tribunal to give evidence and present arguments and, if the invitation is accepted, before hearing the evidence and arguments which the applicant for review seeks to place before the Tribunal in relation to whether he or she has suffered relevant domestic violence. The course of events The appellant's applications for a temporary visa and for a permanent visa were made together in October 2002. A condition for the grant of the temporary visa that was sought was9 that application for that visa be made at the same time and place as an application for the relevant permanent visa. Subject to some exceptions which are not now material, one of the criteria for the grant of the permanent visa now in issue is10 that at least two years have passed since the application was made. The appellant's application for a permanent visa was, therefore, not considered until 2005. In March 2005, following an interview by a delegate of the Minister and a visit to two addresses where it was thought that the appellant and his wife may be living, the Minister's delegate decided to refuse the visa on the ground that the delegate was not satisfied that the appellant was the spouse of the sponsor. Pursuant to s 347 of the Migration Act 1958 (Cth) ("the Act"), the appellant applied for review of this refusal by the Tribunal. In February 2006, the review was still pending and the appellant, through his migration agent, submitted materials to the Tribunal claiming that he had been the victim of domestic violence at the hands of his sponsor. Division 1.5 of the Regulations (regs 1.21-1.27) makes special provisions relating to domestic violence. Regulation 1.22(1) provides that: 9 The Regulations, Sched 1, item 1220A(3)(c). 10 reg 2.03 and Sched 2, cl 100.221(2)(c). Crennan "A reference in these Regulations to a person having suffered domestic violence is a reference to a person being taken[11], under regulation 1.23, to have suffered domestic violence." Regulation 1.23 identifies when a person is taken to have suffered or committed domestic violence. It does that by dealing separately with cases where a court has decided that there has been domestic violence, and cases where there is what is called a "non-judicially determined claim of domestic violence"12. The claim made by the appellant was of the latter kind. Accordingly, the appellant had to submit evidence in support of his claim in accordance with the requirements of regs 1.23(1A)(b)(ii) and 1.24. It is not disputed that the material the appellant submitted to the Tribunal met those requirements. Regulation 1.23(1B) provides for the determination of a non-judicially determined claim of domestic violence. The opening words of reg 1.23(1B) are: "[i]f an application for a visa includes a non-judicially determined claim of domestic violence, the Minister must consider whether the alleged victim has suffered relevant domestic violence". "[R]elevant domestic violence" is defined13 as "violence against the alleged victim or his or her property that causes the alleged victim ... to fear for, or to be apprehensive about, the alleged victim's personal well-being or safety". Regulation 1.23(1B) then goes on to provide for the pursuit of alternative courses according to whether the Minister is satisfied or is not satisfied that the alleged victim has suffered relevant domestic violence. So, the regulation provides, as noted earlier, that "the Minister must consider whether the alleged victim has suffered relevant domestic violence", and continues: "and: if satisfied that the alleged victim has suffered relevant domestic violence – consider the application on that basis; or 11 Section 5(23) of the Act provides that "[t]o avoid doubt, in this Act is taken, when followed by the infinitive form of a verb, has the same force and effect as is deemed when followed by the infinitive form of that verb". 12 reg 1.23(1A). 13 reg 1.23(2)(b). Crennan if not satisfied that the alleged victim has suffered relevant domestic violence – seek the opinion of an independent expert about whether the alleged victim has suffered relevant domestic violence". (emphasis added) Regulation 1.23(1C) then provides for what is to occur once the Minister, not being satisfied that the alleged victim has suffered relevant domestic violence, has sought the opinion of an independent expert. It provides that: "The Minister must take an independent expert's opinion on the matter mentioned in paragraph (1B)(b) to be correct for the purposes of deciding whether the alleged victim satisfies a prescribed criterion for a visa that requires the applicant for the visa, or another person mentioned in the criterion, to have suffered domestic violence." These provisions of reg 1.23 may be contrasted with the provisions they replaced. The provisions in force before the applicable form of reg 1.23 was made in 200514 provided that a person was taken to have suffered domestic violence if the alleged victim submitted certain kinds of evidence. The evidence submitted was not to be weighed or evaluated; the conclusion that the alleged victim was taken to have suffered domestic violence followed from the submission of evidence that met the description given in the Regulations15. By contrast, the provisions of reg 1.23 that are applicable in this case oblige the Minister to consider whether the alleged victim has suffered relevant domestic violence and then take alternative courses according to whether the Minister is satisfied that the alleged victim has suffered such violence, or is not satisfied of that fact. That is, unlike the earlier form of Regulations, reg 1.23 requires evaluation of the claim that is made by the visa applicant. And as these reasons later show, when the Tribunal undertakes its task of reviewing the refusal of a visa, it must evaluate the applicant's claim to have suffered relevant domestic violence. In the present case, none of the provisions of Div 1.5 of the Regulations was engaged when the delegate of the Minister refused to grant the appellant a permanent visa. The appellant had not then made a claim that he had suffered 14 By the Migration Amendment Regulations 2005 (No 4) (Cth). 15 Cakmak v Minister for Immigration and Multicultural and Indigenous Affairs (2003) 135 FCR 183 at 198-199 [49]-[53]. Crennan domestic violence. That claim was first made while the review sought by the appellant of the delegate's refusal was pending in the Tribunal. The Tribunal sought to conduct its review of the decision to refuse to grant the appellant a permanent visa according to the steps and procedures prescribed by Div 1.5. Thus, in response to the submission of written evidence supporting the appellant's claim to have suffered domestic violence, the member constituting the Tribunal for the review, without inviting the appellant to appear to give evidence or make submissions, recorded a finding that she was "not satisfied" that the appellant had suffered relevant domestic violence. The Tribunal then referred the matter for the opinion of an independent expert. In April 2006, the Tribunal received an opinion from an independent expert that the appellant had not suffered relevant domestic violence. A copy of the opinion was sent to the appellant and the appellant made submissions in response. The Tribunal then appointed a hearing but later cancelled that appointment. In the meantime, the appellant provided further evidence in support of his claim to have suffered domestic violence and on 29 May 2006 the Tribunal told the appellant that it would seek a further opinion from an independent expert. It is unnecessary to explore why the Tribunal considered it appropriate to take this step. In July 2006, the Tribunal received the second independent expert's opinion, again to the effect that the appellant had not suffered relevant domestic violence. Again, the Tribunal sent a copy of the opinion to the appellant, and on 10 October 2006 the Tribunal held a hearing at which the appellant adduced evidence and presented arguments in support of his claim to have suffered domestic violence. On 30 October 2006, the Tribunal affirmed the delegate's decision to refuse to grant the appellant the permanent visa he sought. The Tribunal's reasons indicated that it acted on the basis that it was required to take as correct the independent expert's opinion that the appellant had not suffered relevant domestic violence. The appellant applied to the Federal Magistrates Court for relief under s 39B of the Judiciary Act 1903 (Cth), and associated relief, directed to the Tribunal's decision. The Federal Magistrates Court (Riley FM) granted16 the 16 Sok v Minister for Immigration [2007] FMCA 1525. Crennan appellant the relief he sought. The Court declared the Tribunal's decision to be "unlawful, void and of no force and effect" and made orders in the nature of certiorari to quash the decision, prohibition prohibiting the Tribunal and the Minister from giving effect to the decision, and mandamus requiring the Tribunal to rehear and determine according to law the application for review. The Federal Magistrate held17 that the Tribunal was obliged by s 360 of the Act to invite the appellant to a hearing before seeking the opinion of an independent expert and that it had failed to do that. The Minister appealed to the Full Court of the Federal Court of Australia. That Court (French, Lindgren and Jacobson JJ) allowed18 the Minister's appeal, set aside the orders of the Federal Magistrates Court, and ordered that the proceedings in the Federal Magistrates Court be dismissed. The Full Court allowed the Minister's appeal on the basis that the provisions made by Div 1.5 of the Regulations applied only to the original decision-maker and did not apply to the Tribunal in the exercise of its review function19. It followed, in the Full Court's opinion20, that the Tribunal erred in concluding that the appellant could be taken to have suffered domestic violence "notwithstanding that he had not been taken to have suffered domestic violence when his application for the visa had been considered by the Minister". The Full Court concluded21 that "[i]t is only in the application to the Minister that a person can be 'taken' to have suffered domestic violence". These conclusions were not urged by the Minister. When raised by the Full Court in the course of argument, the Minister submitted that neither the provisions of Div 1.5 of the Regulations nor the Act as a whole precluded the Tribunal dealing with a claim to have suffered domestic violence which was a claim first made in connection with a review by the Tribunal. 17 [2007] FMCA 1525 at [20], [27]. 18 Minister for Immigration and Citizenship v Sok (2008) 165 FCR 586. 19 (2008) 165 FCR 586 at 597 [61]. 20 (2008) 165 FCR 586 at 597 [67] 21 (2008) 165 FCR 586 at 597 [67]. Crennan Although, in light of the conclusions the Full Court reached about the application of Div 1.5 of the Regulations, it was not necessary for it to do so, the Full Court further concluded22 that the Tribunal was not required by s 360 of the Act to invite the appellant to appear before it, before forming the view that the Tribunal was not satisfied that the alleged victim has suffered relevant domestic violence. It followed, in the opinion of the Full Court, that if Div 1.5 of the Regulations applied to the Tribunal, the Tribunal would have been entitled to seek an independent expert opinion when it did, and that having obtained that opinion, the Tribunal would have been bound to give effect to the conclusion reached in that opinion. By special leave the appellant now appeals to this Court. In this Court both parties submitted that the Full Court erred in concluding that Div 1.5 of the Regulations applies only to the original decision-maker and has no application to the Tribunal in the exercise of its review function and both parties submitted that the Full Court erred in concluding that it is only in the application to the Minister that a person can be taken to have suffered relevant domestic violence. The parties take opposing positions, however, about whether the Tribunal may reach the point of not being satisfied that the alleged victim has suffered relevant domestic violence before having invited the applicant for review to give evidence and submit arguments. A claim of domestic violence made after the Minister's refusal The relevance of the timing of the appellant's claim to have suffered domestic violence is to be determined by identifying the Tribunal's task. The decision which s 348 of the Act obliged the Tribunal to review was the decision by a delegate of the Minister to refuse to grant the appellant a particular visa. The way in which the Tribunal conducts its review is regulated by the Act. Both parties accepted that, in a case like the present, where the decision under review is a decision to refuse the grant of a visa, the central question for the Tribunal will be whether, at the time the Tribunal makes its decision, the visa applicant is entitled to the grant of the visa that is sought. So much appears to follow from the provisions of s 65(1), which oblige the Minister to grant a visa if the Minister is satisfied that the criteria for the grant of the relevant visa are met, and the grant of power to the Tribunal by s 349(1) to "exercise all the powers and discretions that are conferred by this Act on the person who made the decision" 22 (2008) 165 FCR 586 at 598 [72]. Crennan or by analogy with the cases23 concerning the remedying on review of an otherwise incomplete or invalid visa application. The point not being debated, it is not necessary to pursue it further. The starting point for considering the relevance of the claim the appellant first made to the Tribunal, that he had suffered domestic violence, is to examine the criteria for the grant of the relevant visa. Those criteria are to be found in cl 100.221 of Sched 2 to the Regulations. So far as now relevant, the critical provision is cl 100.221(4) which provides that: "The applicant meets the requirements of this subclause if: the applicant first entered Australia as the holder of a Subclass 309 (Spouse (Provisional)) visa and ... continues to be the holder of that visa; ... and the applicant would meet the requirements of subclause (2) or (2A) except that the relationship between the applicant and the sponsoring spouse has ceased; and after the applicant first entered Australia as the holder of the visa mentioned in paragraph (a) ... (A) the applicant ... has suffered domestic violence committed by the sponsoring spouse". In deciding how the Tribunal is to set about determining whether the visa applicant has suffered domestic violence committed by the sponsor it is necessary to notice two points. First, as noted earlier, reg 1.22 provides that the 23 See, for example, Yilmaz v Minister for Immigration and Multicultural Affairs (2000) 100 FCR 495; Thayananthan v Minister for Immigration and Multicultural Affairs (2001) 113 FCR 297; SZGME v Minister for Immigration and Citizenship (2008) 168 FCR 487 at 494-498 [22]-[36]. Crennan reference in cl 100.221(4)(c)(i)(A) to the applicant having suffered domestic violence "is a reference to a person being taken, under regulation 1.23, to have suffered domestic violence". Secondly, when, as here, a visa application is refused, the applicant seeks review by the Tribunal, and a criterion for granting the relevant visa, which the applicant claims to meet, is that he has suffered domestic violence, the question – whether a person is taken under reg 1.23 to have suffered domestic violence – is committed to the Tribunal. Contrary to the opinion of the Full Court24, the relevance of the appellant's claim to have suffered domestic violence is not to be determined by first considering the terms of Div 1.5 and observing that the provisions of that Division are hinged upon an application for a visa and that an application for a visa is made to the Minister. Neither the provisions of Div 1.5 generally, nor the frequent references made in the Division to the Minister, confine the criteria for the grant of the visa prescribed by cl 100.221 to those cases in which the visa applicant has made a claim of domestic violence before the initial consideration of the visa application. Rather, in reviewing the refusal to grant the permanent visa, the Tribunal is to determine whether the criterion for the grant of that visa (that the appellant "has suffered domestic violence committed by the sponsoring spouse") is met. And that criterion is met only if the appellant is to be taken, under reg 1.23, to have suffered domestic violence. In deciding that question, the Tribunal may exercise all of the powers and discretions conferred by that Division of the Regulations on the Minister. Hence, the first question identified at the outset of these reasons – can the domestic violence qualification to the relevant visa requirements be engaged if the claim is first made in the Tribunal – is to be resolved in the appellant's favour. Seeking an independent expert's opinion before a Tribunal hearing Regulation 1.23(1B) provides that, where there is a non-judicially determined claim of domestic violence, the Minister must consider whether the alleged victim "has suffered relevant domestic violence" and then, if not satisfied that the alleged victim has suffered relevant domestic violence, seek the opinion of an independent expert. The Minister must25 take the opinion of the independent expert to be correct. 24 (2008) 165 FCR 586 at 597 [63]-[66]. 25 reg 1.23(1C). Crennan When the Tribunal comes to exercise the powers and discretions given to the Minister under reg 1.23, and in particular when the Tribunal is considering an application for a visa that includes a non-judicially determined claim of domestic violence, the consideration which the Tribunal must give to the claim is regulated by those provisions of the Act which prescribe the Tribunal's procedures. Of critical importance to the present matter is the obligation imposed on the Tribunal by s 360(1) to invite the applicant for review to appear before the Tribunal to give evidence and present arguments relating to "the issues arising in relation to the decision under review". In many, perhaps most, cases, "the issues arising in relation to the decision under review" that are referred to in s 360(1) will most easily be identified26 by considering the reasons for decision given by the primary decision-maker (the Minister or the Minister's delegate). In the present case, however, the appellant raised a new issue in relation to the decision under review when he made his claim to have suffered domestic violence. Once the appellant made the claim that he had suffered relevant domestic violence, the Tribunal was bound by s 360 to invite him to appear before it to give evidence and present arguments relating to that issue, and any other issue that could be described as "arising in relation to the decision under review". As the Minister rightly submitted, s 359 of the Act permits the Tribunal, in conducting its review, to "get any information that it considers relevant". In particular27, the Tribunal may invite a person to give additional information. Sections 359A, 359B and 359C make consequential provisions about giving the applicant for review certain information, about how an invitation to give additional information or to comment on information is to be extended, and about the consequences that are to attach to a failure to give additional information or comments. Thus, so the Minister's argument proceeded, it was open to the Tribunal to seek additional information concerning an applicant's claim to have suffered relevant domestic violence. More particularly, the Minister submitted, it was open to the Tribunal to obtain further "evidence" concerning the claim by seeking the opinion of an independent expert of the kind referred to in reg 1.23(1B)(b) if, on the material then before it, the Tribunal was not satisfied 26 SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs (2006) 228 CLR 152 at 162-163 [34]-[35]; [2006] HCA 63. Crennan that the alleged victim had suffered relevant domestic violence. The Minister recognised, indeed submitted, that the Tribunal was then bound to take the independent expert's opinion to be correct for the purposes of deciding whether the alleged victim satisfied the relevant visa criterion. But the Minister further submitted that, while this may "narrow" or "confine" the issues arising in relation to the decision under review, it would not deprive s 360(1) of any relevant operation. It was said not to have that effect because the obtaining of an opinion would leave open for argument whether the opinion that had been obtained satisfied the description used in reg 1.23(1B)(b): "the opinion of an independent expert". The conclusions asserted by the Minister should not be accepted. The bases for rejecting those conclusions can be expressed in a number of different ways but all of them depend upon giving close attention to the relevant statutory requirements, particularly s 360 of the Act. The need to focus closely upon those provisions of the Act that regulate the Tribunal's conduct of its review is reinforced by consideration of s 357A(1). That sub-section, the validity of which was assumed by both the appellant and the Minister, provides that Div 5 of Pt 5 of the Act (ss 357A-367) "is taken to be an exhaustive statement of the requirements of the natural justice hearing rule in relation to the matters it deals with". It follows, then, that s 357A provides that the prescription by s 360, of when the Tribunal is to invite an applicant to appear before it to give evidence and present arguments, is an exhaustive statement of that aspect of the requirements of the natural justice hearing rule. The Minister submitted that reg 1.23(1B) obliged the decision-maker to consider whether there had been relevant domestic violence and then choose between alternative courses according to whether the decision-maker was satisfied or not satisfied about that question. The Minister's submission that, when the Tribunal was the relevant decision-maker, it could arrive at what was described, in argument, as a "fork" in the procedural road by pronouncing itself not satisfied, by the material then available, that the alleged victim has suffered relevant domestic violence, sought to locate the relevant fork in the road at a point which attached no significance to s 360(2)(a). That provision dispenses the Tribunal from the obligation to invite the applicant to appear to give evidence and present arguments if, on the basis of the material before it, the Tribunal considers that it should decide the review in the applicant's favour. And if the Tribunal were to form that opinion, it would follow that par (a) of reg 1.23(1B) would be engaged, because the Tribunal would be satisfied that the alleged victim had suffered relevant domestic violence. In the words of reg 1.23(1B)(a), Crennan the Tribunal would then be bound to consider the application for review "on that basis". The necessary premise for the Minister's argument was that the Tribunal was not satisfied on the basis of the material before it that the review should be decided in the applicant's favour. The Minister submitted that the Tribunal could nonetheless take the second of the two roads identified in reg 1.23(1B) by declaring itself not to be satisfied that the alleged victim had suffered relevant domestic violence. So to read the provisions denies that the only relevant qualification to the obligation imposed on the Tribunal by s 360(1), to invite the applicant to attend to give evidence and present arguments, is provided by s 360(2)(a). And by hypothesis, s 360(2)(a) was not engaged in this case. The same conclusion can be expressed in terms drawn from reg 1.23. In those terms it may be said that the Tribunal has not undertaken its task of considering whether the alleged victim has suffered relevant domestic violence before either, in exercise of the power given by s 360(2)(a), it decides the review in the applicant's favour on the basis of the material before it, or it exercises the power given by s 360(1), and invites the applicant to appear before it to give evidence and present arguments relating to the issues arising in relation to the decision under review. If the Tribunal is not satisfied on the material before it that it should decide the review in the applicant's favour, it must give the applicant the hearing required by s 360(1). And if that is the Tribunal's obligation, the Tribunal cannot be said for the purposes of reg 1.23 to have considered the issues raised on the review, in the manner required by the Act, until it has issued the requisite invitation under s 360(1) and, if the invitation is accepted, heard the evidence and arguments that are advanced. The last basis for rejecting the Minister's submissions focuses upon that step in the Minister's argument which sought to characterise the obtaining of an independent expert opinion as the Tribunal obtaining "further information" or "evidence". Neither of those descriptions is apt. It is necessary to bear steadily in mind that obtaining the opinion of an independent expert will determine any issue about whether there had been relevant domestic violence. That is to say, the obtaining of an opinion that satisfies the description in reg 1.23(1B)(b) – "the opinion of an independent expert" – is dispositive of an issue arising in relation to the decision under review by the Tribunal. Indeed, in the present case, the opinion was treated as dispositive of the appellant's claim to a permanent visa. It is therefore not right to argue, as the Minister's submission did, from a premise that the Tribunal can obtain additional information relating to an issue arising in relation to the Crennan decision under review, to a conclusion that an issue arising on the review may be decided against the applicant for review without first having invited the applicant to appear to give evidence and present arguments. Describing the opinion of the independent expert as "further information" or "evidence" neither requires nor permits that conclusion. The conclusion urged by the Minister would reduce the hearing required by s 360 to an opportunity to comment on whether the opinion obtained met the statutory criteria. It would deny any operation for the section in respect of an issue arising in relation to the decision under review that will often be an issue of critical importance to the fate of the review. That step cannot be taken. The second question identified at the outset of these reasons – may the Tribunal decide that it is "not satisfied" of an applicant's claim to have suffered domestic violence before inviting the applicant to give evidence and present arguments – should also be resolved in the appellant's favour. Conclusion and orders For these reasons, the Federal Magistrate was right to conclude that the Tribunal had not conducted the review which the appellant had sought in accordance with the requirements of the Act, in particular s 360. The failure to do so constituted jurisdictional error and the Federal Magistrates Court was right to grant the appellant the relief which it did. It follows that the appeal to this Court should be allowed with costs, the orders of the Full Court of the Federal Court of Australia made on 5 March 2008 and 2 April 2008 should be set aside and in their place there should be orders that the appeal to the Full Court of the Federal Court of Australia is dismissed with costs.

HIGH COURT OF AUSTRALIA COMMISSIONER OF STATE REVENUE APPELLANT AND ROJODA PTY LTD RESPONDENT Commissioner of State Revenue v Rojoda Pty Ltd [2020] HCA 7 Date of Hearing: 6 & 7 November 2019 Date of Judgment: 18 March 2020 ORDER Appeal allowed with costs. Set aside the orders of the Court of Appeal of the Supreme Court of Western Australia made on 21 December 2018 and in their place order that the appeal be dismissed with costs. On appeal from the Supreme Court of Western Australia Representation J A Thomson SC, Solicitor-General for the State of Western Australia, with E C Salsano for the appellant (instructed by State Solicitor's Office (WA)) B Dharmananda SC with S K Grimley for the respondent (instructed by Ernst & Young Law Pty Ltd) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Commissioner of State Revenue v Rojoda Pty Ltd Stamp duties – Declaration of trust – Partnership – Dissolution – Partnership assets – Nature of partners' rights in relation to partnership assets – Where freehold titles to land held by two partners as joint tenants – Where other partners not registered title holders – Where partnerships dissolved but not wound up upon death of one partner holding titles – Where surviving partner declared trusts over freehold titles for benefit of other partners in proportion to partnership interests – Where Commissioner assessed declaration of trust as "dutiable transaction" within meaning of Duties Act 2008 (WA), s 11(1) – Whether partner holding freehold titles trustee for other partners – Whether declaration of trust by surviving partner holding freehold titles created new interests in land – Whether declaration of trust dutiable transaction. Words and phrases – "beneficial interest", "conveyance", "declaration of trust", "dissolution", "dutiable transaction", "equitable interest", "non-specific interest", "partners' interest", "partnership property", "right to account and distribution", "transfer", "trust for partnership", "winding up". Partnership Act 1895 (WA), ss 30, 32, 33, 50, 57. Duties Act 2008 (WA), ss 11(1)(c), 78. BELL, KEANE, NETTLE AND EDELMAN JJ. Introduction What is the nature of the interest of partners in partnership property? This is the question at the heart of this appeal. The appeal concerns declarations made in two deeds in 2013 between the partners and their successors in title of two dissolved partnerships that had not yet been wound up. The deeds provided that freehold titles registered in the names of two partners, which were part of the partnership property of the two dissolved partnerships, be held on trust for the former partners or their representatives in fixed shares according to their partnership shares. The appellant, the Commissioner of State Revenue, imposed duty upon the declarations of trust that were made in each of the two deeds. The central submission of the respondent, Rojoda Pty Ltd, is that the deeds merely confirmed the existing position in relation to the partnership property of the dissolved partnerships: the property had been held on trust for the partners in fixed shares and this position continued. The State Administrative Tribunal dismissed Rojoda's application for review of the Commissioner's decision on the basis that the deeds involved declarations of new trusts that were dutiable under the Duties Act 2008 (WA). However, the Court of Appeal of the Supreme Court of Western Australia held that the deeds did not involve any dutiable transaction because after the dissolution of the partnerships the practical reality that liabilities would be discharged from current assets meant that the freehold titles were then held on fixed trust for the partners according to their partnership shares. Rojoda's submission in this Court is that, subject to the partnership agreement, a partner's legal title to partnership property is held on trust for all the partners. That submission should be accepted. However, the nature of the partners' rights under that trust is unique. They differ significantly from the rights under a fixed trust and their nature does not change before winding up is complete. The creation of fixed trusts by the two deeds in 2013 involved the extinguishment of these unique equitable rights and the dutiable event of the creation of new fixed trusts. Rojoda's further contentions that the two deeds involved conversion agreements rather than declarations of trust and that they involved agreements to transfer partnership property to the former partners and their successors under s 78 of the Duties Act should also be dismissed. The appeal should be allowed. Bell Nettle Edelman Background The background to this appeal concerns the business affairs of the Scolaro family. For clarity, and with no disrespect intended, reference is made in these reasons to the family members by their first names. The Scolaro family ran a business of property ownership and investment. The business was conducted through two partnerships. The first was the Scolaro Investment Company Partnership ("the SIC Partnership"). The SIC Partnership was established by a Deed of Partnership in 1972 with five equal partners. The partners were Anthony and Maria Scolaro and their three children, Rosana, John, and David. The second partnership was the A&MMR Scolaro Partnership ("the AMS Partnership"). The AMS Partnership was established by a Deed of Partnership in 1986 with two equal partners. Those partners were Anthony and Anthony died on 12 February 2011, leaving his estate to be divided equally between three testamentary trusts for his children: (i) the JASCO Testamentary Trust (with John as the primary beneficiary); (ii) the RASCO Testamentary Trust the primary beneficiary); and (iii) the DASCO Testamentary Trust (with David as the primary beneficiary). (with Rosana as Upon Anthony's death, each of the partnerships dissolved. The partnership deeds had provided a mechanism for this dissolution to be "technical" or "notional" with the other partners to continue the business of the partnership. But this did not occur. Instead, on 12 May 2011 and 15 March 2012, respectively, each of the AMS Partnership and the SIC Partnership was subject to a general dissolution in accordance with the respective partnership deeds. The combined value of the properties of the AMS Partnership at dissolution was $14.2 million and, in relation to the SIC Partnership, $11.65 million. For each partnership, the value of cash and other current assets exceeded the value of the liabilities. Anthony and Maria had been registered as joint tenants of six freehold titles (four of which as to a half-share) which were partnership property of the SIC Partnership. They were also registered as joint tenants of five freehold titles (one of which as to a half-share) which were partnership property of the AMS Partnership. Following Anthony's death, Maria, as the surviving joint tenant, became registered as proprietor of the freehold titles. None of the properties was sold. John died intestate on 7 August 2012. By operation of s 14 of the Administration Act 1903 (WA), one-third of his estate passed to his wife and Bell Nettle Edelman two-thirds passed to his children. John's wife, Bianca, and his daughter, Diana, became the trustees of the JASCO Testamentary Trust. Diana became the Until December 2013, the partnership freehold titles were accounted for as assets in the balance sheets of the partnerships. None of the partnership freehold titles had been sold and this litigation proceeded on the basis that the partnership liabilities had not been discharged. On 1 December 2013, Maria, her two surviving children (Rosana and David), Diana and Bianca, and Rojoda entered into two deeds concerning, respectively, the SIC Partnership ("the SIC Deed") and the AMS Partnership ("the AMS Deed") (together "the 2013 Deeds"). Each of the 2013 Deeds takes the same approach in relation to the freehold titles of each partnership. The relevant recitals to the SIC Deed are replicated in the AMS Deed with relevant changes to reflect the different freehold titles of each partnership and the half-shares of each of Anthony and Maria in that partnership. The 2013 Deeds each recite, in Recital C, the detail of the freehold titles that were held by "Anthony Scolaro and Maria Scolaro ... jointly as joint trustees for the Partnership". Those freehold titles are referred to as "the Properties" in each deed. In Recital E, the 2013 Deeds each recite that "[o]n the passing away of Anthony Scolaro, Maria Scolaro became the sole surviving trustee of the Properties. The Properties continued to be held on trust for the Partnership as before." Recital F describes the properties as to which the legal title was transferred "into the sole name of Maria Scolaro as the sole surviving trustee" and states that the "beneficial ownership ... remained unchanged". Recital J of the SIC Deed and Recital I of the AMS Deed reiterate that on dissolution of the partnerships the "beneficial interest in the assets" was held by the former partners or their estates. Recital W of the SIC Deed and Recital Q of the AMS Deed recite that the parties "consider it prudent to appoint a new trustee ... to replace Maria Scolaro as trustee of the Properties". That new trustee was Rojoda. The operative clauses of the 2013 Deeds are as follows: Clause 1: the parties "acknowledge and agree" various matters, including that on dissolution of the partnerships the "Properties and other assets that were previously held by the Partnership were beneficially owned" as to shares of 20 per cent for each of the partners (in the SIC Deed) and 50 per cent for each of the partners (in the AMS Deed). Clauses 2 and 3 in the SIC Deed and cl 2 in the AMS Deed: the executors of Anthony's estate and the administrator of John's estate, and in the case of the AMS Deed Anthony's estate, "hereby transmit" the deceased's beneficial shares of "the Properties" according to the terms of Anthony's Bell Nettle Edelman will (with respect to Anthony) and the Administration Act 1903 (WA) Two final clauses (misnumbered in the SIC Deed): (i) Maria "confirms" that she holds the Properties on trust for the partners and the legatees of Anthony and John in their respective shares; and (ii) Maria resigns as trustee of the Properties and the parties agree that Rojoda be appointed as the new trustee with transfers of the legal title to the Properties to be made to Rojoda. The Commissioner imposed duty upon the declarations of trust in each of the 2013 Deeds. Objections were lodged by the former partners on two bases. First, it was submitted that no duty was payable because the 2013 Deeds had not created new trusts. The partnership freehold titles had always been held on trust and the 2013 Deeds had merely confirmed this trust. Secondly, it was submitted that only nominal duty should have been payable to the extent to which the 2013 Deeds gave effect to distributions of both Anthony's estate and John's estate. The first submission was rejected by the Commissioner but the second was accepted. Duty was re-assessed in the total amount of $707,285. The imposition of duties by the Duties Act 2008 (WA) The Duties Act imposes duty on dutiable transactions1 with the duty to be charged "by reference to the dutiable value of a dutiable transaction"2. One type of dutiable transaction is "a declaration of trust over dutiable property"3. Dutiable property includes "land in Western Australia"4 and "a right"5. A "declaration of trust" is defined as6: 1 Duties Act 2008 (WA), s 10. 2 Duties Act, s 26(1)(a). 3 Duties Act, s 11(1)(c). 4 Duties Act, s 15(a). 5 Duties Act, s 15(b). 6 Duties Act, s 9, definition of "declaration of trust". Bell Nettle Edelman "any declaration (other than by a will) that any identified property vested or to be vested in the person making the declaration is or is to be held in trust for the person or persons, or the purpose or purposes, mentioned in the declaration although the beneficial owner of the property, or the person entitled to appoint the property, may not have joined in or assented to the declaration". Another type of dutiable transaction is a "partnership acquisition"7. A partnership acquisition is defined as including "a person acquiring a partnership interest in a partnership that holds ... land in Western Australia"8. In turn, the Duties Act provides that a partnership interest is acquired upon the formation of a partnership or if the person's partnership interest increases9. The value of the acquired partnership interest is calculated by reference to capital contributions made by or required of the partner and losses that must be borne by the partner10. The dutiable value of the partnership acquisition is calculated by reference to dutiable property held by the partnership or an entity linked to the partnership11. Section 78(1) of the Duties Act provides for a reduction in the duty payable in circumstances of a transfer or agreement to transfer property of the partnership to a "retiring partner" where the person is a retiring partner due to their retirement from the partnership or its dissolution. Section 78(2) provides: "The dutiable value of a transfer of, or an agreement for the transfer of, dutiable property to the retiring partner must be reduced by an amount calculated by applying the retiring partner's partnership interest in the partnership the dutiable property the unencumbered value of immediately before the retirement or dissolution." 7 Duties Act, s 11(1)(i). 8 Duties Act, s 72(a). 9 Duties Act, s 75(1). 10 Duties Act, s 74. 11 Duties Act, ss 76, 77. Bell Nettle Edelman The central issue The Commissioner's consistent case throughout this litigation was that the 2013 Deeds created a new trust due to the change in character of the rights of the former partners or their estates from a unique equitable interest in partnership property to a new equitable interest under a fixed trust. Rojoda's consistent primary position was that the 2013 Deeds did not involve a declaration of trust, and hence they were not a dutiable transaction on that basis, because they merely confirmed the existence of the trust upon which partners held the partnership property. At no stage in this litigation was any issue raised arising from the agreed fact that two of the six freehold titles of the SIC Partnership, at Hay Street and Colin Street in West Perth, were the subject of declarations of trust by Anthony and Maria. Those declarations of trust were made in 1976 and 1988 respectively, as to a one-fifth share in favour of each of Anthony, Maria, Rosana, John, and David. Although reference was made in this Court to the fact of those declarations, Rojoda properly did not seek to rely upon a ground of contention, not referable to any issue raised in the Tribunal or the Court of Appeal, to allege that these declarations of fixed trust meant that the declarations of trust in the 2013 Deeds were not dutiable transactions. Nor was it submitted that these declarations of trust were inconsistent with the agreed fact that the Hay Street and Colin Street freehold titles were partnership property of the SIC Partnership. The Tribunal and Court of Appeal decisions Rojoda applied to the Tribunal for review of the Commissioner's decision to levy duty on the transactions arising from the 2013 Deeds. In a decision given by the Deputy President (Judge Sharp), the Tribunal dismissed the application. The Tribunal held that after dissolution of the partnerships, but before the 2013 Deeds, the partners had only a right to their respective proportion of the surplus after realisation of assets and payment of debts and liabilities. The Tribunal therefore held that since the effect of the 2013 Deeds was to declare a bare trust over the legal title to the properties held by Maria in favour of each of the former partners and the legatees of the deceased estates, the transactions in the 2013 Deeds were dutiable because the 2013 Deeds thus altered the status of the partnership property. The alteration was said to be "from property which was to Bell Nettle Edelman be used to satisfy their contractual rights of due administration of the partnership, to property held upon new trusts for them"12. The Tribunal also held that the declaration of the bare trusts by the 2013 Deeds involved the creation of new equitable interests rather than the "transfer" of existing equitable interests. Hence, the Tribunal rejected an alternative submission by Rojoda that the 2013 Deeds were agreements to transfer legal title to the partnership properties which were said by Rojoda to have enlivened s 78 of the Duties Act, requiring a reduction in the amount of duty13. An appeal to the Court of Appeal of the Supreme Court of Western Australia was allowed. A similar and complementary approach was taken between the joint reasons of Buss P and Beech JA and the reasons of Murphy JA. The starting point of their Honours' reasoning was orthodox. As each judgment correctly observed, the interest of partners in relation to partnership assets is not an interest in any particular asset but is an indefinite and fluctuating interest in relation to the assets, being the right to a proportion of the surplus after the realisation of the assets and payment of the debts and liabilities of the partnership14. Further, as each judgment also correctly observed15, and as Taylor and Menzies JJ had explained in Hendry v The Perpetual Executors and Trustees Association of Australia Ltd16, this remains the position after the "general"17 dissolution of the partnership following death or retirement of a partner but before completion of the winding up. The consequence of this reasoning would have been that duty would have been payable on the transactions under the 12 Rojoda Pty Ltd v Commissioner of State Revenue (2017) 91 SR (WA) 76 at 104 13 Rojoda Pty Ltd v Commissioner of State Revenue (2017) 91 SR (WA) 76 at 105- 14 Rojoda Pty Ltd v Commissioner of State Revenue (2018) 368 ALR 734 at 737 [10], 15 Rojoda Pty Ltd v Commissioner of State Revenue (2018) 368 ALR 734 at 738-739 (1961) 106 CLR 256 at 265-266. 17 Commissioner of State Taxation (SA) v Cyril Henschke Pty Ltd (2010) 242 CLR Bell Nettle Edelman 2013 Deeds due to their creation of trusts of the freehold titles held by the partnerships, in fixed shares according to the interests of the former partners. However, in both judgments their Honours considered that the character of the partners' equitable rights had changed on dissolution to be a fixed interest in the partnership freehold titles with the consequence that no duty was payable. The reasoning in each judgment was broadly similar, and was as follows18: (i) after dissolution the practical reality was that a court would order the discharge of partnership debts in winding up by the use of cash or other current assets; (ii) equity would regard as done that which ought to be done and would allocate current assets to the payment of liabilities; (iii) if current assets were assumed to be allocated to payment of all partnership liabilities then the surplus of partnership assets after discharge of liabilities would be sufficiently ascertained and each partner would have a specific and fixed beneficial or equitable interest in the assets comprising that surplus; (iv) this conclusion was supported by the decisions in Cameron v Murdoch19, In re Ritson20, and In re Holland21; and (v) since the declaration of trust merely replicated the existing trust of partnership property it was not dutiable, it being unnecessary to decide whether this was because there was no declaration of trust under s 11(1)(c) or whether the duty was reduced to a nominal duty under s 78 of the Duties Act. interests In light of the conclusions that the Court of Appeal reached, further issues raised by the parties were not addressed. Rojoda had sought, and was granted, leave to add an alternative ground of appeal alleging that the 2013 Deeds were agreements by the former partners and their successors to "convert" their partnership the Properties". The Commissioner had resisted this ground of appeal with a notice of contention alleging, in effect, that if there were such an agreement to convert interests as Rojoda alleged then that agreement involved a declaration of trust to create the new, fixed equitable interests. Rojoda had also submitted that any duty payable under the 2013 Deeds was reduced to a nominal amount by s 78 of the Duties Act. into "fixed equitable interests 18 Rojoda Pty Ltd v Commissioner of State Revenue (2018) 368 ALR 734 at 739-744 [1983] WAR 321; on appeal (1986) 60 ALJR 280; 63 ALR 575. In re Ritson; Ritson v Ritson [1899] 1 Ch 128. In re Holland; Brettell v Holland [1907] 2 Ch 88. Bell Nettle Edelman The appeal grounds and Rojoda's notice of contention in this Court In this Court, the Commissioner's ground of appeal maintained her consistent stance that both before and after the dissolution of each partnership, but before winding up, the partners had only a non-specific, fluctuating interest in all the partnership freehold titles so that the 2013 Deeds created new trusts of those titles by a transaction that was liable for duty under s 11(1)(c) of the Duties Act. Rojoda supported the reasoning of the Court of Appeal, although submitting that the partnership freehold titles were always held on trust. By leave of this Court, save for a reference to one factual matter which was said only to be relevant as background22, Rojoda's amended notice of contention effectively involves three grounds: first, that the partnership freehold titles were always held on trust for the partners and that the partners' interests under the trust became ascertainable upon dissolution of the partnership; secondly, and alternatively, that Maria had no power to declare any trust and, instead, the 2013 Deeds had only confirmed a separate agreement of the partners to convert their partnership interests under a trust into specific equitable interests in the freehold titles; and thirdly, and in the further alternative, that if the 2013 Deeds did involve declarations of trust then the declarations of trust were agreements to transfer partnership property, namely the freehold titles, to the former partners and their successors according to their respective partnership interests and were not dutiable due to the operation of s 78 of the Duties Act. Each of these grounds can be considered in turn. Partners' rights after dissolution and the 2013 Deeds Rojoda's primary submission began with the proposition that, in the absence of provision otherwise in the partnership agreement, partnership property is held on trust for the partners. For the reasons below, that proposition should be accepted. However, the equitable rights of partners under a trust of partnership property differ substantially from the equitable rights created by the declarations of trust in the 2013 Deeds. Contrary to the reasoning of the Court of Appeal, those rights did not change after dissolution due to the equitable maxim that equity regards as done that which ought to be done. The Tribunal was therefore correct to conclude that the 2013 Deeds involved dutiable transactions, being the declaration of new trusts. 22 See above at [18], reference to the Hay Street and Colin Street properties. Bell Nettle Edelman Partners' rights in equity before the Partnership Act 1895 (WA) Insofar as it concerned partnership property, like the partnership legislation in other parts of Australia23, the Partnership Act 1895 (WA) was an "exact counterpart"24 of the United Kingdom legislation that was introduced in 189025. Perhaps unsurprisingly, given that the Bill for the Partnership Act 1890 in the United Kingdom was "carefully examined" by Lindley LJ, who was the author of the leading work on partnership at the time26, the legislation was said to have "introduced no great change in the law"27. Two decades before the 1890 legislation, different views had been expressed in Knox v Gye28 concerning whether partnership property was held on trust for a deceased partner's estate. Lord Westbury said that a surviving partner is sometimes described, inaccurately, as a trustee for the deceased partner. He said that the surviving partner was not a trustee and that although the surviving partner "may be called" a trustee so far as his obligations extend to the estate of the deceased partner, "when these obligations have been fulfilled, or are is at an end"29. discharged, or Lord Westbury compared the description of the surviving partner as a trustee with the metaphorical and improper description, which continues to be regarded as inaccurate30, of a vendor of land under a specifically enforceable contract of the supposed terminate by trust law, 23 Partnership Act 1891 (Qld); Partnership Act 1891 (SA); Partnership Act 1891 (Tas); Partnership Act 1891 (Vic); Partnership Act 1892 (NSW). 24 Western Australia, Legislative Assembly, Parliamentary Debates (Hansard), 17 July 1895 at 315. 25 Partnership Act 1890 (53 & 54 Vict c 39), see, relevantly, ss 20(1), 20(2), 22, 39. 26 United Kingdom, Parliamentary Debates, House of Commons, 18 July 1890, vol 347, col 227. See Lindley, A Treatise on the Law of Partnership (1860). 27 Sandhu v Gill [2006] Ch 456 at 464 [25], quoting Banks, Lindley & Banks on Partnership, 18th ed (2002) at 4 [1-06]. (1872) LR 5 HL 656. 29 Knox v Gye (1872) LR 5 HL 656 at 675. 30 See Haque v Haque [No 2] (1965) 114 CLR 98 at 124-125; Chang v Registrar of Titles (1976) 137 CLR 177 at 190; Kern Corporation Ltd v Walter Reid Trading Footnote continues Bell Nettle Edelman sale as a trustee. Lord Westbury then said that there is "nothing fiduciary" about the relationship between the surviving partner and the representative of the deceased partner31. Shortly before the enactment of the United Kingdom Partnership Act in 1890, Frederick Pollock referred to Lord Westbury's remarks and said that the description sometimes given of a surviving partner as a trustee of partnership property was "at least doubtful"32. In contrast, Lord Hatherley LC expressed "very strongly" his dissent from the view that there was no fiduciary relationship between the surviving partner and the representative of the deceased partner. The Lord Chancellor said that title to the partnership assets might be vested in the surviving partner at common law but in equity a tenancy in common arose so that the assets were held subject to the interests of the estate of the deceased partner and the surviving partner was accountable to the representatives of the deceased partner for the use of the assets33. The view of Lord Hatherley prevailed. That view is principled. It accords with the fundamental obligation of each partner to render an account of dealings with partnership property, which had long been enforced at law34, then in equity35, and now under statute36. The relationship of partners was designated as Pty Ltd (1987) 163 CLR 164 at 192; Tanwar Enterprises Pty Ltd v Cauchi (2003) 217 CLR 315 at 332 [53]. 31 Knox v Gye (1872) LR 5 HL 656 at 675-676. 32 Pollock, A Digest of the Law of Partnership, 4th ed (1888) at 82 fn 3. 33 Knox v Gye (1872) LR 5 HL 656 at 678-679. 34 Clerk v Winterbourne (1289) in Brand (ed), The Earliest English Law Reports (2007), vol 4 at 430. See Brand, "Merchants and Their Use of the Action of Account in Thirteenth- and Early Fourteenth-Century England", in Allen and Davies (eds), Medieval Merchants and Money: Essays in Honour of James L Bolton (2016) 293 at 298, 303. 35 Lumley v Garret (1636-37) Toth 2 [21 ER 105]. See Spence, The Equitable Jurisdiction of The Court of Chancery (1846), vol 1 at 649-650, 665-666. 36 See, eg, Partnership Act 1895 (WA), s 39. Bell Nettle Edelman "fiduciary" around the time that term became commonplace37. A basal fiduciary obligation, as moulded by agreement38, is that each partner will hold, and will deal with, legal rights to partnership property for the benefit of all the partners, whose interest lies in their right to a share of the net proceeds of partnership property after winding up. had that been Lord Hatherley's view that partnership property is held on trust also reflected the acceptance of the existence of a trust in earlier cases39 as well as the approach expressed Sir Nathaniel Lindley's treatise on partnership since 186040. It was also consistent with a line of cases that had limited the application in equity of rights of survivorship between partners, so that upon the death of a partner who was a joint tenant at common law, the other joint tenant would continue to hold the interest of the deceased partner on trust for the persons entitled to the deceased estate41. successive editions 37 Lees v Laforest (1851) 14 Beav 250 at 257 [51 ER 283 at 285]; cf Sealy, "Fiduciary Relationships" [1962] Cambridge Law Journal 69 at 72 fn 11. 38 See Hospital Products Ltd v United States Surgical Corporation (1984) 156 CLR 41 at 97; Henderson v Merrett Syndicates Ltd [1995] 2 AC 145 at 206; Australian Securities and Investments Commission v Citigroup Global Markets Australia Pty Ltd [No 4] (2007) 160 FCR 35 at 77 [281]; John Alexander's Clubs Pty Ltd v White City Tennis Club Ltd (2010) 241 CLR 1 at 36 [91]-[92]. 39 West v Skip (1749) 1 Ves Sen 239 at 242 [27 ER 1006 at 1008]; Crawshay v Collins (1808) 15 Ves Jun 218 at 229 [33 ER 736 at 741] ("equitable title"); Broom v Broom (1834) 3 My & K 443 at 444 [40 ER 169 at 169]. 40 Lindley, A Treatise on the Law of Partnership (1860), vol 1 at 546-547, 564; 2nd ed (1867), vol 1 at 644-645, 664-665; 3rd ed (1873), vol 1 at 663-664, 684- 685; 4th ed (1878), vol 1 at 643-644, 664-665; 5th ed (1888) at 323-324, 341. See now Banks, Lindley & Banks on Partnership, 20th ed (2017) at 666 [18-07], 41 Lake v Gibson (1729) 1 Eq Ca Abr 290 at 291 [21 ER 1052 at 1053]; Lake v Craddock (1732) 3 P Wms 158 at 159 [24 ER 1011 at 1012]; Lyster v Dolland (1792) 1 Ves Jun 431 at 434-435 [30 ER 422 at 423-424]; Jackson v Jackson (1804) 9 Ves Jun 591 at 596-597, 603-604 [32 ER 732 at 734, 736-737]. Bell Nettle Edelman Some of the features of a partner's equitable rights under the trust were shared with those of a fixed trust: the interests of the partners were in fixed shares or proportions; the partners owed to each other the common duty of a trustee to apply the partnership property exclusively for the benefit of the partnership those beneficiaries who are entitled to "wind up" a trust43, a partner could dissolve the partnership, requiring a winding up and consequential distribution of the proceeds of the partnership assets44. in accordance with like However, unlike a beneficiary of a fixed trust, it was well established that a partner's interest was not an interest in, or in relation to, any specific asset other than an entitlement to the partner's share of the net proceeds from the sale of each asset at the completion of winding up. In other words, the only right that the partners have, both before and after dissolution, in relation to each asset is a right to the account and distribution after sale of the proceeds of that asset – "not to an individual proportion of a specific article, but to an account: the property to be made the most of, and divided"45. Hence, a partner's equitable interest is not accurately expressed as a "beneficial interest"46, at least in the sense of being a 42 Crawshay v Collins (1808) 15 Ves Jun 218 at 226 [33 ER 736 at 740]; Gardner v M'Cutcheon (1842) 4 Beav 534 at 542-543 [49 ER 446 at 449]; Clegg v Fishwick (1849) 1 Mac & G 294 at 298-299 [41 ER 1278 at 1280]. 43 Compare Saunders v Vautier (1841) 4 Beav 115 [49 ER 282]; affirmed (1841) Cr & Ph 240 [41 ER 482], discussed in CPT Custodian Pty Ltd v Commissioner of State Revenue (Vic) (2005) 224 CLR 98 at 119 [47]. 44 Featherstonhaugh v Fenwick (1810) 17 Ves Jun 298 at 310 [34 ER 115 at 120]; Darby v Darby (1856) 3 Drew 495 at 504 [61 ER 992 at 995]. 45 Crawshay v Collins (1808) 15 Ves Jun 218 at 229 [33 ER 736 at 741]. See also West v Skip (1749) 1 Ves Sen 239 at 242 [27 ER 1006 at 1008]; Doddington v Hallet (1750) 1 Ves Sen 497 at 499 [27 ER 1165 at 1166]; Taylor v Fields (1799) 4 Ves Jun 396 at 396 [31 ER 201 at 202]; Featherstonhaugh v Fenwick (1810) 17 Ves Jun 298 at 309-310 [34 ER 115 at 120]; Lingen v Simpson (1824) 1 Sim & St 600 at 603 [57 ER 236 at 238]; Cockle v Whiting (1829) Tamlyn 55 at 61-62 [48 ER 23 at 26]; Darby v Darby (1856) 3 Drew 495 at 503-504 [61 ER 992 at 995]; Wild v Milne (1859) 26 Beav 504 at 505 [53 ER 993 at 993]. 46 Commissioner of State Taxation (SA) v Cyril Henschke Pty Ltd (2010) 242 CLR 508 at 517 [25]. See also MSP Nominees Pty Ltd v Commissioner of Stamps (SA) (1999) 198 CLR 494 at 509 [34]. Bell Nettle Edelman right to any proportion of, or for the personal use of, or for the benefit from, any particular asset. In a famous description that encapsulated the equitable principles, Lindley described a partner's interest as "his proportion of the partnership assets after they have been all realised and converted into money, and all the debts and liabilities have been paid and discharged"47. Lindley added that "[t]his it is, and this only, which on the death of a partner passes to his representatives". Lindley's famous description was copied from the third edition of his text, with attribution, by Pollock48, who acknowledged Lindley's work as "the guide and foundation of my own", and directed a "reader desiring fuller information" to Lindley's work49. The description by Lindley emphasised that although the partners have an existing equitable interest in relation to each and every asset for the payment of their share after winding up is complete, that interest can fluctuate during trading and is not ascertained until the assets are realised in a fund upon winding up. Hence, despite some contrary authority50, where the partnership property was land the equitable interest was described as a "personal estate" in relation to the land to signify that there was no vested or ascertainable right in relation to the particular legal estate in the land51. 47 Lindley, A Treatise on the Law of Partnership (1860), vol 1 at 561. 48 Pollock, A Digest of the Law of Partnership (1877) at 49-50, citing Lindley, A Treatise on the Law of Partnership, 3rd ed (1873) at 681. 49 Pollock, A Digest of the Law of Partnership (1877) at xxi-xxii. 50 Bell v Phyn (1802) 7 Ves Jun 453 at 458 [32 ER 183 at 185]; Randall v Randall (1835) 7 Sim 271 at 287-288 [58 ER 841 at 847]; Cookson v Cookson (1837) 8 Sim 529 at 548 [59 ER 210 at 217]. 51 Ripley v Waterworth (1802) 7 Ves Jun 425 at 451-452 [32 ER 172 at 182-183]; Townsend v Devaynes (1808) in Montagu, A Digest of The Law of Partnership (1815), vol 1, appendix at 97, 101; Crawshay v Maule (1818) 1 Swans 495 at 508, 521 [36 ER 479 at 484, 485-486]; Phillips v Phillips (1832) 1 My & K 649 at 663 [39 ER 826 at 832]; Houghton v Houghton (1841) 11 Sim 491 at 506 [59 ER 963 at 969]; Essex v Essex (1855) 20 Beav 442 at 450 [52 ER 674 at 677]; Darby v Darby (1856) 3 Drew 495 at 506 [61 ER 992 at 996]; Holroyd v Holroyd (1859) 7 WR 426 at 427. Bell Nettle Edelman The Partnership Act 1895 (WA) The Western Australian Partnership Act, like its 1890 United Kingdom counterpart, reflects the equitable principle that, subject to the terms of the partnership deed, partners hold legal rights to the partnership property on trust for all the partners. Section 30(1) requires partnership property to be held and applied by the partners "exclusively for the purposes of the partnership, and in accordance with the partnership agreement" so that if property is acquired as partnership property in the name only of one partner it will be held "upon trust for the partnership"52. Section 30(2) provides that the legal estate or interest in land which is partnership property devolves according to the general rules of law but "in trust so far as necessary for the persons beneficially interested in the land under this section". Section 30(2) does not create any new trust in relation to land. It gives "statutory recognition" to the equitable principle that legal title to partnership property is held on trust for all partners53. The reason for the specific provision that estates in land devolve on trust is to ensure that "no distinction can be drawn between the nature of a partner's interest in real estate and his interest in personal estate"54. Whatever the nature of the partnership property and "wherever the legal estate may be"55, it is held on trust for the partners, whose interests are as tenants in common56. As Deane J said in Chan v Zacharia57, "there is neither metaphor nor inaccuracy" in the description of a partner as a trustee for the partnership. The Partnership Act also preserved equity's unique treatment of the interest of partners under the trust. The partner's unascertained interest in relation 52 Carter Bros v Renouf (1962) 111 CLR 140 at 163. 53 Re George Livanos, Deceased [1955] St R Qd 362 at 367. See also In re Bourne; Bourne v Bourne [1906] 2 Ch 427 at 432-433. 54 Canny Gabriel Castle Jackson Advertising Pty Ltd v Volume Sales (Finance) Pty Ltd (1974) 131 CLR 321 at 328. See also Watson v Ralph (1982) 148 CLR 646 at In re Bourne; Bourne v Bourne [1906] 2 Ch 427 at 432. 56 Spence v Federal Commissioner of Taxation (1967) 121 CLR 273 at 280. (1984) 154 CLR 178 at 194. Bell Nettle Edelman to all of the partnership property is an equitable interest, not a mere equity58, but the "partner's share" is defined in s 33 as being only "the proportion of the then existing partnership assets to which he would be entitled if the whole were realised and converted into money, and after all the then existing debts and liabilities of the firm had been discharged". Hence, as Lindley MR explained, a "deceased partner could only dispose of his interest in the surplus which would remain after payment of the joint debts out of the joint assets"59. Until then, a partner's interest under the trust is unascertained and, although it is a non-specific interest that concerns all partnership assets60, it is not a right to any particular partnership asset61. Indeed, in order that "all doubt upon the point [be] removed"62, s 32 makes certain that, in the absence of agreement, partners will lack a vested interest in any land that is partnership property. It provides that unless the contrary intention appears, where land has become partnership property it is treated between partners, and the heirs, executors or administrators of partners, as personal and not real estate. Although the peculiar nature of the fluctuating, unascertained, non- specific interest of partners in relation to partnership assets may have led Fullagar J, in dissent in Maslen v Perpetual Executors Trustees & Agency Co (WA) Ltd63, to doubt whether partners had an interest in partnership assets that 58 Canny Gabriel Castle Jackson Advertising Pty Ltd v Volume Sales (Finance) Pty Ltd (1974) 131 CLR 321 at 325, 328; Cameron v Murdoch (1986) 60 ALJR 280 at 293; 63 ALR 575 at 597-598. In re Ritson; Ritson v Ritson [1899] 1 Ch 128 at 130-131. 60 Canny Gabriel Castle Jackson Advertising Pty Ltd v Volume Sales (Finance) Pty Ltd (1974) 131 CLR 321 at 327-328; Federal Commissioner of Taxation v Everett (1980) 143 CLR 440 at 446; United Builders Pty Ltd v Mutual Acceptance Ltd (1980) 144 CLR 673 at 687. 61 Rodriguez v Speyer Brothers [1919] AC 59 at 68; Wolfson v Registrar-General (NSW) (1934) 51 CLR 300 at 312-313; Bakewell v Deputy Federal Commissioner of Taxation (SA) (1937) 58 CLR 743 at 770; Livingston v Commissioner of Stamp Duties (Q) (1960) 107 CLR 411 at 453; Commissioner of State Taxation (SA) v Cyril Henschke Pty Ltd (2010) 242 CLR 508 at 517 [25]. 62 Lindley, A Treatise on the Law of Partnership, 6th ed (1893) at 352. (1950) 82 CLR 101 at 119-120. Bell Nettle Edelman was capable of assignment, s 33 of the Partnership Act reflects the position, long established in equity, that partners do have an interest in relation to partnership property although, as this Court has constantly reiterated, the interest "can be finally ascertained only when the liquidation has been completed"64 and until then it is a non-specific interest65. That is all that could have been meant by Rich J when he said, in dissent in Sharp v The Union Trustee Co of Australia Ltd66, that the unascertained interest of a partner "is in proportion to his share in the ultimate surplus coming to him if at that moment the partnership were wound up and its accounts taken". As Dixon and Evatt JJ said in Bakewell v Deputy Federal Commissioner of Taxation (SA)67, a partner's share in a partnership consists "not of a title to specific property, but of a right to his proportion of the surplus after the realization of the assets and payment of the debts and liabilities of the partnership". Upon dissolution, but before the partnership is wound up, the partnership property will continue to be held by the legal owner on trust with a duty to sell68. Once winding up is complete, and the interest of each partner in the share of the 64 Livingston v Commissioner of Stamp Duties (Q) (1960) 107 CLR 411 at 453, quoting Rodriguez v Speyer Brothers [1919] AC 59 at 68; Watson v Ralph (1982) 148 CLR 646 at 650; Commissioner of State Taxation (SA) v Cyril Henschke Pty Ltd (2010) 242 CLR 508 at 517 [25]. See also Sharp v The Union Trustee Co of Australia Ltd (1944) 69 CLR 539 at 551; Federal Commissioner of Taxation v Everett (1980) 143 CLR 440 at 446-447; United Builders Pty Ltd v Mutual Acceptance Ltd (1980) 144 CLR 673 at 688. 65 Livingston v Commissioner of Stamp Duties (Q) (1960) 107 CLR 411 at 453; Canny Gabriel Castle Jackson Advertising Pty Ltd v Volume Sales (Finance) Pty Ltd (1974) 131 CLR 321 at 327; Federal Commissioner of Taxation v Everett (1980) 143 CLR 440 at 446; United Builders Pty Ltd v Mutual Acceptance Ltd (1980) 144 CLR 673 at 687; Watson v Ralph (1982) 148 CLR 646 at 650. (1944) 69 CLR 539 at 551. See also Hendry v The Perpetual Executors and Trustees Association of Australia Ltd (1961) 106 CLR 256 at 266. (1937) 58 CLR 743 at 770 (emphasis added). In re Bourne; Bourne v Bourne [1906] 2 Ch 427 at 432-433; McCaughey v Commissioner of Stamp Duties (NSW) (1914) 18 CLR 475 at 488-489. Bell Nettle Edelman surplus can be identified69, then, like the rights of legatees of a wholly administered estate70, s 50 of the Partnership Act recognises the partners' right to the transfer of the net value of their entitlements from the person holding the surplus. The creation of a new trust by the 2013 Deeds Prior to the 2013 Deeds, the legal position of the partners of each of the AMS Partnership and the SIC Partnership was as follows. Since there was no provision to the contrary in either of the partnership deeds, Maria held the freehold titles of each partnership on trust for the partners. The rights of the partners under that trust were unique. Each partner had a non-specific interest in relation to all of the partnership freehold titles (as well as all of the current assets of each partnership) with a right, upon dissolution, to compel the sale of the freehold titles in order to realise a fund from which at the conclusion of the winding up a vested share could then be claimed. Although the relevant operative clause of each of the 2013 Deeds provided that Maria "confirms" that she held the freehold titles of each partnership on trust in the relevant proportions for each former partner or their successors, those "confirmations" of fixed trust had a substantive effect. They extinguished the unique equitable rights of the partners under the partnership trusts and created new fixed trusts. The 2013 Deeds effectively removed all the freehold titles from the property of each partnership available to create a fund for the payment of partnership debts, including for payment to external creditors. The fund for each partnership became limited to the current assets of the partnership. No partner could individually compel the sale of any of the freehold titles in the process of winding up the partnership. And each partner had new ascertained equitable rights in relation to the freehold titles held on fixed trust. Rojoda submitted that the lack of a new trust was supported by a distinction between the internal and the external perspectives of partnership 69 Commissioner of State Taxation (SA) v Cyril Henschke Pty Ltd (2010) 242 CLR 70 Commissioner of Stamp Duties (Q) v Livingston (1964) 112 CLR 12 at 21; [1965] AC 694 at 711, quoting Barnardo's Homes v Special Income Tax Commissioners [1921] 2 AC 1 at 8, 10. Bell Nettle Edelman property. But the distinction between these perspectives does not change the nature of the rights held by partners. The distinction merely contrasts the contractual restrictions within the partnership deed with the partners' rights in relation to partnership assets71. The contractual restrictions apply only between the partners but the legal rights to, or equitable rights of partners in relation to, partnership property can be the basis for a claim against third parties such as those who receive partnership property as volunteers72. As Hoffmann LJ said in Inland Revenue Commissioners v Gray73, it is the "outside view which identifies the nature of the property falling to be valued for the purpose of capital transfer tax". So too, the nature of the equitable rights is the basis for the assessment of duty under the Duties Act. Rojoda also submitted that the 2013 Deeds created no new trust within the Duties Act because no dutiable property "moved". s 11(1)(c) of This submission is contrary to equitable principle and contrary to the operation of the Duties Act. As to equitable principle, it is fundamental that the creation of a trust involves the creation of new equitable obligations74, which are "annexed to the trust property"75 or "engrafted"76 or "impressed upon it"77. The creation of a 71 Law Commission and Scottish Law Commission, Partnership Law, Law Com No 283, Scot Law Com No 192 (2003) at 161-162 [9.67]. See also Canny Gabriel Castle Jackson Advertising Pty Ltd v Volume Sales (Finance) Pty Ltd (1974) 131 CLR 321 at 327-328, quoting In re Fuller's Contract [1933] Ch 652 at 656. 72 Lipkin Gorman v Karpnale Ltd [1991] 2 AC 548 at 564, quoting Hudson v Robinson (1816) 4 M & S 475 at 478 [105 ER 910 at 911]. [1994] STC 360 at 377. 74 Chief Commissioner of Stamp Duties (NSW) v Buckle (1998) 192 CLR 226 at 242- 243 [38]. See also Federal Commissioner of Taxation v Linter Textiles Australia Ltd (In liq) (2005) 220 CLR 592 at 606 [30]. 75 DKLR Holding Co (No 2) Pty Ltd v Commissioner of Stamp Duties [1980] 1 NSWLR 510 at 519. See also Maitland, Equity: also The Forms of Action at Common Law (1929) at 17-18; Maitland, Equity: A Course of Lectures, 2nd ed (rev) (1936) at 17. 76 Re Transphere Pty Ltd (1986) 5 NSWLR 309 at 311. 77 DKLR Holding Co (No 2) Pty Ltd v Commissioner of Stamp Duties (NSW) (1982) 149 CLR 431 at 474. Bell Nettle Edelman trust never involves "movement" of property in the sense of a conveyance of title from one person to another. The Duties Act does not presuppose any different principle in its reference to a "declaration of trust over dutiable property" in s 11(1)(c) as a dutiable transaction. Indeed, as Rojoda accepted, there may be duty payable if a discretionary trust were extinguished and replaced by a trust for the same persons in fixed shares. No property would have "moved" but the creation of new equitable rights under a fixed trust is sufficient to attract duty. The Duties Act does not contemplate any different operation where the equitable rights extinguished are those sui generis rights of partners in relation to partnership property. The maxim that equity regards as done that which ought to be done As mentioned above, the Court of Appeal avoided the conclusion that the 2013 Deeds had created new trusts by reasoning that as a consequence of the general dissolution of each of the AMS Partnership and the SIC Partnership, in circumstances in which the "practical certainty" was that liabilities would be discharged from current assets, equity would regard as done that which ought to be done and would treat the freehold titles as held on fixed trusts according to the shares of each partner. This reasoning involves a misapplication of the equitable maxim. As Professor McFarlane has observed, the maxim "bites not on moral obligations ... but only on duties recognised in equity independently of the maxim"78. Equity creates and protects equitable rights and interests in property "only where their recognition has been found to be required in order to give effect to its doctrines"79. Indeed, in the context of partnership property, the maxim has been applied to the opposite effect to that adopted by the Court of Appeal. Rather than treating each partner as having a fixed share in the partnership property upon 78 McFarlane, "The Maxims of Equity", in McGhee and Elliott (eds), Snell's Equity, 34th ed (2020) 91 at 105 [5-015]. 79 Commissioner of Stamp Duties (Q) v Livingston (1964) 112 CLR 12 at 22; [1965] AC 694 at 712, quoted with approval in Commissioner of State Taxation (SA) v Cyril Henschke Pty Ltd (2010) 242 CLR 508 at 517 [25]. Bell Nettle Edelman dissolution, the maxim was applied by Bowen LJ to recognise that the interest of a partner was personal property, namely, a right to money upon the winding up80. The use of the equitable maxim in the manner in which it was deployed by the Court of Appeal was unnecessary to give effect to any right or duty recognised by equity. Instead, by creating rights under a fixed trust it was (i) inconsistent with equitable principles incorporated in the Partnership Act which concern the position of external creditors and (ii) contrary to the respective partnership agreements. The creation of a fixed trust is inconsistent with the equitable principles incorporated in the Partnership Act and the position of external creditors because an implication arising from the entitlement of each partner under s 50 of the Partnership Act to have the property of the partnership applied after dissolution "in payment of the debts and liabilities of the firm" is that each partner has a right to insist upon sale of partnership property for cash to be used to pay those debts and liabilities81. Further, s 57(1) of the Partnership Act provides for the rules to be observed, subject to agreement, "[i]n settling accounts between the partners after a dissolution of partnership". Section 57(3) provides as follows, with the first priority given to external creditors of the firm: "The assets of the firm, including the sums, if any, contributed by the partners to make up losses or deficiencies of capital, shall be applied in the following manner and order – in paying the debts and liabilities of the firm to persons who are not partners therein; in paying to each partner rateably what is due from the firm to him for advances as distinguished from capital; in paying to each partner rateably what is due from the firm to him in respect of capital; 80 Attorney-General v Hubbuck (1884) 13 QBD 275 at 289. See also McCaughey v Commissioner of Stamp Duties (NSW) (1914) 18 CLR 475 at 488-489. 81 Ex parte Ruffin (1801) 6 Ves Jun 119 [31 ER 970]; Ex parte Peake, In re Lightoller (1816) 1 Madd 346 [56 ER 128]. Bell Nettle Edelman the ultimate residue, if any, shall be divided among the partners in the proportion in which profits are divisible." The use of the equitable maxim to create a fixed trust is also inconsistent with cl 19 of the Deed of Partnership in respect of the AMS Partnership and cl 18 of the Deed of Partnership in respect of the SIC Partnership. Those clauses, in similar terms, make provision for the consequences of dissolution consistently with ss 50 and 57 of the Partnership Act. Both clauses provide for a full account to be taken of all transactions and, in the words of cl 19 of the AMS Deed of Partnership, that "such assets and credits shall with all convenient speed be sold realised and got in" with each partner being required to do all necessary acts "for effecting or facilitating the sale realisation and getting in of the partnership assets and credits and the due application and division of the profits thereof". The Court of Appeal relied upon three decisions in support of the application of the equitable maxim upon dissolution to create a fixed trust of the freehold titles with current assets to be used to discharge partnership liabilities. Although the language in each of those decisions is not precise, and with great respect for the detailed reasoning of the Court of Appeal, none of the decisions supports the application of the maxim in this way. Each is considered in turn below. (1) Cameron v Murdoch In Cameron v Murdoch82, a testator devised and bequeathed all of his real and personal property to his trustee upon trust to pay his debts and testamentary and other expenses and to stand possessed of the balance remaining upon trust for the testator's brother for life and upon his death upon trust to pay a specified sum to a named beneficiary; as to a specified real property upon trust for such of two specified nephews and two specified nieces as should survive him and attain the age of 21 years; and, as to the residue, upon trust for such of several other specified nieces as might survive him. Although it appeared as if the testator believed that he owned the real property in his own right, after his death it was found that it had been property of a partnership in which he had a 10/27 partnership share. The residuary legatees disputed the efficacy of the devise of the testator's share in relation to the real property on the ground that, because the partnership had not been wound up, the testator's interest in the real property had not been fully ascertained and it was not possible to construe the devise as [1983] WAR 321; on appeal (1986) 60 ALJR 280; 63 ALR 575. Bell Nettle Edelman passing an unascertained interest in the real property. In the Supreme Court of Western Australia, Brinsden J held that the devise was effective "to the extent of the totality of [the testator's] interest in the land ... the totality of that interest being 10/27"83. As to the share that the testator had held as a partner, Brinsden J described that interest in the conventional terms of an "indefinite and fluctuating interest" and, upon dissolution and in the absence of partnership debts, as a share of "the value of the total assets on taking final accounts"84. After proposing possible orders, subject to submissions from the parties, for the winding up of the original partnership and the taking of accounts, Brinsden J proposed an order (order 8) declaring that the devise of the real property was effective to pass the testator's interest, "namely, 10/27 of the entirety"85. Brinsden J was not suggesting that, prior to taking of accounts and completion of winding up, the testator had any vested or ascertained interest in or in relation to the real property. Rather, the testator had devised that unascertained, non-specific interest in the real property the value of which could be ascertained finally upon the taking of accounts. The Privy Council dismissed an appeal and cross-appeal from the decision of Brinsden J. The reasoning of the Privy Council concerning the testator's interest was not materially different. Delivering the advice of the Board, Lord Brandon of Oakbrook applied the decision of this Court in Canny Gabriel Castle Jackson Advertising Pty Ltd v Volume Sales (Finance) Pty Ltd86, which had recognised the nature of a partner's interest in each item of partnership property as unascertained and non-specific. Although his Lordship referred to the interest of the testator as an equitable interest "in every part of the original partnership assets, including [the real property]"87 and referred to the interest in the real property as 10/27, this could not have been intended to contradict his reliance upon the decision in Canny Gabriel Castle Jackson Advertising Pty Ltd. It could only have been to suggest that the value of what was devised, upon winding up and assuming the discharge of all partnership debts, was in the proportion 10/27. 83 Cameron v Murdoch [1983] WAR 321 at 343. 84 Sharp v The Union Trustee Co of Australia Ltd (1944) 69 CLR 539 at 551. 85 Cameron v Murdoch [1983] WAR 321 at 363. (1974) 131 CLR 321. 87 Cameron v Murdoch (1986) 60 ALJR 280 at 293; 63 ALR 575 at 597-598. Bell Nettle Edelman That is not to deny that the testator had an interest in every single asset of the former partnership proportionate to his share in the totality of the surplus assets of the partnership. Nor is it to suggest that the testator was incapable by his will of passing that interest to his trustees88. It is simply to say that as between the beneficiaries of the testator's will, the beneficiaries were bound to do what they could to achieve the testator's wish that his interest in the real property be held on separate trust from his interest in other assets. In that sense only, the devise was effective to pass the described 10/27 interest in the specified real property to be held on trust for the specified nephews and nieces. (2) In re Holland In re Holland89 involved a deceased partner who left his share of the partnership on trusts in his will but had sought separately to make a devise of a share in four freeholds in the proportion of his partnership share. In a dispute between the legatees, Neville J held that the legatees "as between themselves are bound to give effect as best they can to the wishes the testator has expressed"90. The question in that case was simply whether the disposition was valid. Since the partnership was solvent and other partnership property was sufficient to clear the debts, Neville J held that the disposition was valid. There was no finding, and there could have been no finding, that the effect of the partner's will had been to dispose specifically of a share in the freehold titles. All that the partner was capable of disposing of, and, as a matter of interpretation of the will, all that he could have disposed of, was the partner's interest in relation to the freehold titles, being the relevant proportion of the proceeds of sale from the ultimate sale of those freehold titles upon the winding up of the partnership. In re Holland says nothing about a partner having a specific identifiable interest in any of the assets of the partnership. To the contrary, it emphasises that the position as between partners – being the contractual relationship which is determinative of the nature of each partner's interest in partnership assets – is that 88 Perpetual Executors and Trustees Association of Australia Ltd v Federal Commissioner of Taxation (1954) 88 CLR 434 at 444; [1954] AC 114 at 130; Burdett-Coutts v Inland Revenue Commissioners [1960] 1 WLR 1027 at 1035; [1960] 3 All ER 153 at 159; Hendry v The Perpetual Executors and Trustees Association of Australia Ltd (1961) 106 CLR 256 at 266-267. In re Holland; Brettell v Holland [1907] 2 Ch 88. In re Holland; Brettell v Holland [1907] 2 Ch 88 at 91. Bell Nettle Edelman each partner has no more than the right to have partnership assets applied in satisfaction of partnership debts and liabilities and the surplus distributed among partners in accordance with their shares. If, however, a partner makes sufficiently clear by the terms of their will that they wish for their estate to be applied as if they were able to treat their interest in a specified partnership asset as capable of separation from their interest in the rest of the partnership assets, and to give it in a different direction from their interest in the rest of the partnership assets, the testator's beneficiaries will be bound as between themselves to give effect to the testator's wishes to the extent that they are able to do so. In Livingston v Commissioner of Stamp Duties (Q)91, Kitto J referred to In re Holland92 as establishing that a partner has an interest in "every piece of property which belongs to the partnership". This interest in every piece of property is the fluctuating, unascertained interest in relation to the entire partnership property. As his Honour continued, that interest "consists not of a title to specific property but of a right to a proportion of the surplus after the realization of the assets and payment of the debts and liabilities of the partnership". His Honour reiterated that the interest was not a "'definite' share or interest in a particular asset" nor a "'right to any part' of it"93. The final authority relied upon by the Court of Appeal was In re Ritson94. In that case, a partner had charged real estate that he owned to secure a debt of the partnership. After the partner died, his executors and trustees took out a summons asking whether the secured partnership debt should be paid from the charged real estate or from the partnership assets. The Court of Appeal held that it should be paid from the partnership assets first. The only right of the executors of a deceased partner was to have paid over to them the testator's share of the surplus assets of the partnership95. Therefore, just as the deceased partner was (1960) 107 CLR 411 at 453. In re Holland; Brettell v Holland [1907] 2 Ch 88. (1960) 107 CLR 411 at 453, quoting Rodriguez v Speyer Brothers [1919] AC 59 at In re Ritson; Ritson v Ritson [1899] 1 Ch 128. In re Ritson; Ritson v Ritson [1899] 1 Ch 128 at 130-131. Bell Nettle Edelman entitled to insist as against other partners that upon the dissolution of the partnership its assets be applied in discharge of the partnership liabilities with the balance to be distributed among the partners according to their shares, so too, after death, the executors of the deceased partner were entitled to insist that the partnership liabilities be discharged out of partnership assets and not out of real property of the deceased partner. Because the deceased partner devised his interest in the partnership to his trustees on one set of trusts and his interest in the charged land which he owned beneficially on other trusts, the testator was to be taken by his will as signifying that he wished the partnership debts to be discharged out of partnership assets in the same way as he might have insisted if he had remained alive. As between them, his beneficiaries and trustees were bound to observe the testator's wishes and to do the best they could to achieve them. That meant that they were not to use the land for the discharge of the partnership debts. But contrary to the way in which the case was interpreted by the Court of Appeal, it does not follow that the estate of a deceased partner may dictate to other partners that personal property partnership assets alone be used to discharge partnership debts in order that the real property assets of the partnership may be preserved and distributed in specie as between the partners and the deceased estate. The conversion agreement their "partnership In this Court, there was dispute about Rojoda's ability to make a submission that the 2013 Deeds constituted an agreement by the partners to interests". "convert" The Commissioner asserted that this was a new argument that had not been raised below and as to which the Commissioner would be prejudiced because she had assessed the 2013 Deeds as transactions which created trusts rather than as agreements to transfer rights. into specific equitable interests It is unnecessary to consider whether the point was squarely raised below or whether there could be any prejudice to the Commissioner if it is raised now. The short point is that the submission that the 2013 Deeds involve an agreement rather than a declaration of trust involves a simple category error. Rojoda's purported contrast is between, on the one hand, a trust and, on the other hand, an agreement in the 2013 Deeds to "convert" partnership interests to specific equitable interests. This is a false contrast because trusts can be created by agreement as well as by unilateral declaration. Any so-called "conversion agreement" in the 2013 Deeds involved extinguishing the existing rights held by the former partners or their representatives and the creation of new equitable rights annexed to the partnership freehold titles. This was the declaration of fixed trusts. Bell Nettle Edelman Rojoda's submission that Maria had no power to declare such trusts without the agreement of the other partners or their representatives is correct. But the 2013 Deeds were an agreement between all of the former partners or their representatives to extinguish their existing, unascertained partnership interests and to create new trusts of the freehold titles held by Maria. Section 78 of the Duties Act The final ground of Rojoda's notice of contention asserted that the 2013 Deeds involved agreements to transfer partnership property to the former partners and their successors and were not dutiable due to the operation of s 78 of the Duties Act. The purpose of s 78 of the Duties Act is to ensure that duty is not levied on both a conveyance or agreement to convey property to a partnership and, upon dissolution, a conveyance or agreement to convey the same property to partners in their partnership share. It treats the conveyance of property out of a partnership according to the partner's share upon dissolution as not being a separate dutiable event from the conveyance into a partnership. For instance, if land is acquired by a partnership of A, B and C, the acquisition will be a dutiable transaction. The value of the partnership interest of A, B and C will be reduced by the incidence of that duty. Section 78 ensures that A, B and C are not again subjected to duty if the property is conveyed to them after dissolution according to their same partnership shares. The example in the Duties Act at the conclusion of s 78 illustrates this96: "A, B and C are in partnership in equal shares. B had a one-third partnership interest immediately before retiring. On B ceasing to be a partner, A and C transfer land to B. The dutiable value of the land acquired by B will be reduced by one-third." Rojoda accepted that if the 2013 Deeds did not embody agreements to transfer rights to the partners upon dissolution then it would not be entitled to rely upon s 78 of the Duties Act. However, Rojoda submitted that s 78 of the Duties Act used the concept of "transfer" in a loose sense that extended to the creation of new rights. Rojoda pointed to the provision for nominal duty in s 139(2)(b) of the Duties Act for "a declaration of trust over dutiable property to the extent that it gives effect to a distribution in the estate of a deceased person". 96 See Interpretation Act 1984 (WA), ss 19(1), 19(2)(a). Bell Nettle Edelman Rojoda submitted that this provision involves recognition that a declaration of trust can effect a "distribution" even though, strictly, the creation of equitable rights involves no distribution. So too, Rojoda submitted, although the declaration of trust creates new equitable rights and does not "transfer" them, the reference to "transfer" in s 78(2) should be applied to extend to the creation of new equitable rights. In other words, s 78 should be interpreted with the loose use of "transfer" as though it included the words "a declaration of trust over dutiable property to the extent that it gives effect to a transfer to any former partner". This submission should not be accepted. As explained above, a declaration of trust does not transfer rights. Whether or not there is any looseness in the use of "distribution" in s 139(2)(b) of the Duties Act, s 78 refers to a "transfer" rather than to a "distribution". "Transfer" is not used in a sense that could capture the creation of new equitable rights. The definition of "transfer" in s 9 includes an "assignment" or "exchange". It does not include a "declaration of trust", which is separately defined in the same section. Further, s 11(1) recognises the distinction between a transfer and the creation of new rights by providing separately for, on the one hand, a "transfer of dutiable property" and an "agreement for the transfer of dutiable property" (ss 11(1)(a) and 11(1)(b)), and, on the other hand, "a declaration of trust over dutiable property" (s 11(1)(c)). Like ss 11(1)(a) and 11(1)(b), s 78 is concerned with true transfers of rights or agreements for such transfers. Rojoda also submitted that the decision of this Court in Commissioner of State Taxation (SA) v Cyril Henschke Pty Ltd97 recognised that a declaration of trust involved an agreement to transfer rights in this loose sense. The terms of the legislation being considered in Henschke were significantly different but, in any event, this is not an accurate characterisation of the reasoning in that decision. Henschke concerned a deed between the four partners of a partnership that purported to continue the partnership without dissolution following the retirement of one partner, Mrs Henschke. The deed provided that Mrs Henschke's interest had ceased upon the payment to her of an amount equivalent to her proportionate share in relation to the partnership assets. The question was whether the deed was a "conveyance on sale" within the meaning of s 60 of the Stamp Duties Act 1923 (SA). This Court held that it was. (2010) 242 CLR 508. Bell Nettle Edelman As this Court explained, the term "conveyance" was defined in s 60 of the Stamp Duties Act as including every instrument "by which or by virtue of which or by the operation of which ... any ... personal property or any estate or interest in any such property is assured to, or vested in, any person"98. The deed in that case met that definition99. It extinguished the partnership interests, including Mrs Henschke's interest, and then re-vested in the new partnership the enlarged interests of the other partners. In other words, it discharged the previous partnership agreement by accord and satisfaction100 and "vested in the members of the second partnership the equitable choses in action representing their present partnership interests"101, which were "enlarge[d]" following the "release" of Mrs Henschke's interest102. Nothing in Henschke suggests that this process involved any "transfer". Conclusion and orders The appeal should be allowed. Orders should be made as follows: (1) Appeal allowed with costs. Set aside the orders of the Court of Appeal of the Supreme Court of Western Australia made on 21 December 2018 and in their place order that the appeal be dismissed with costs. 98 Commissioner of State Taxation (SA) v Cyril Henschke Pty Ltd (2010) 242 CLR 99 Commissioner of State Taxation (SA) v Cyril Henschke Pty Ltd (2010) 242 CLR 100 Commissioner of State Taxation (SA) v Cyril Henschke Pty Ltd (2010) 242 CLR 508 at 515 [19], citing McDermott v Black (1940) 63 CLR 161 at 183-184. 101 Commissioner of State Taxation (SA) v Cyril Henschke Pty Ltd (2010) 242 CLR 102 Commissioner of State Taxation (SA) v Cyril Henschke Pty Ltd (2010) 242 CLR The majority identifies the question at the heart of this appeal as being as to the nature of the interests of partners in partnership property. My understanding of the better answer to that question is different. The difference between us illustrates the observation that the "peculiar"103 or "special"104 nature of the interests of partners in partnership property is "conceptually somewhat opaque"105. A partnership, of course, is not a legal entity. In the language of the Partnership Act 1895 (WA) ("the Western Australian Partnership Act"), it is a "relation which subsists between persons carrying on a business in common with a view of profit"106, whose mutual rights and obligations are governed by their partnership agreement107, each of whom is bound by acts and instruments relating to the partnership business done or executed by another in the name of the partnership108, each of whom is jointly and severally liable with the others for loss or injury caused by the wrongful act or omission of any one of them in the ordinary course of the partnership business109, and each of whom is liable jointly with the others for all debts and liabilities incurred in carrying on the partnership business110. Partnership property comprises all property brought into the partnership or acquired on account of the partnership or for the purposes of and in the course of 103 Canny Gabriel Castle Jackson Advertising Pty Ltd v Volume Sales (Finance) Pty Ltd (1974) 131 CLR 321 at 327. 104 United Builders Pty Ltd v Mutual Acceptance Ltd (1980) 144 CLR 673 at 687. 105 Commissioner of State Taxation (SA) v Cyril Henschke Pty Ltd (2010) 242 CLR 508 at 517 [23], quoting Sandhu v Gill [2006] Ch 456 at 462 [18]. 106 Section 7(1) of the Western Australian Partnership Act. 107 Section 29 of the Western Australian Partnership Act; cf s 34(1A). 108 Section 13(1) of the Western Australian Partnership Act. 109 Sections 17(1) and 19 of the Western Australian Partnership Act. 110 Section 16 of the Western Australian Partnership Act. the partnership111. In respect of partnership property, each partner has two kinds of rights which it is important to keep conceptually distinct112. Unless varied by the partnership agreement or otherwise by the consent of all partners113, each partner has a right against all other partners to have all of the partnership property held and applied exclusively for the purposes of the partnership in accordance with the partnership agreement114 and, on dissolution of the partnership, to have the debts and liabilities of the partnership paid out of the partnership property and then to have the surplus applied in payment of what is due to the partners respectively under the partnership agreement115. That right which a partner has against the other partners is itself property of the partner: it is an equitable chose in action116. Against the rest of the world, each partner has rights of a different nature. The partners collectively have the beneficial interest in each item of partnership property. Each partner individually has a share in that beneficial interest in each item of partnership property117. "No doubt, as between himself and his partners, his interest in individual items is subject to their right to have all the assets of the 111 Section 30(1) of the Western Australian Partnership Act. 112 Haque v Haque [No 2] (1965) 114 CLR 98 at 130. 113 Section 29 of the Western Australian Partnership Act. 114 Section 30(1) of the Western Australian Partnership Act. 115 Section 50 of the Western Australian Partnership Act. 116 Federal Commissioner of Taxation v Everett (1980) 143 CLR 440 at 446-447; United Builders Pty Ltd v Mutual Acceptance Ltd (1980) 144 CLR 673 at 688. 117 Canny Gabriel Castle Jackson Advertising Pty Ltd v Volume Sales (Finance) Pty Ltd (1974) 131 CLR 321 at 327. See also Sharp v The Union Trustee Co of Australia Ltd (1944) 69 CLR 539 at 551; Maslen v Perpetual Executors Trustees & Agency Co (WA) Ltd (1950) 82 CLR 101 at 129; Hendry v The Perpetual Executors and Trustees Association of Australia Ltd (1961) 106 CLR 256 at 266, quoting Burdett-Coutts v Inland Revenue Commissioners [1960] 1 WLR 1027 at 1034-1035; [1960] 3 All ER 153 at 158-159; Watson v Ralph (1982) 148 CLR 646 at 650; Chan v Zacharia (1984) 154 CLR 178 at 194. partnership for the time being dealt with in accordance with the partnership agreement, but his interest in them is none the less real for that"118. From the perspective of the partnership as an organisation for the carrying on of a common business, the practical result of that overlay of legal and equitable rights is highly functional. The result is that119: "as between the partners, the partnership property must be dealt with in a particular way, but so far as all the rest of the world is concerned, there is no limitation on the interests of the partners; the partners have the beneficial interest in the partnership assets, which are held together as an undivided whole, but they respectively have undivided interests in them". That description is true of the whole of the partnership property, and it is true of each item of partnership property. Those trading with the partnership are able to have confidence that the partners collectively have capacity to acquire and to convey legal title to and beneficial ownership of real and personal property in the course of carrying on the partnership business without need to concern themselves about the respective proprietary interests of the individual partners. Though partnership property that is an interest in land is treated as the partners120, partnership property can personal property as between comprise any real or personal property legal title to which is acquired on account of the partnership by all or any of the partners. Partnership property legal title to which is acquired by all of the partners, such as trading stock purchased on partnership account, is co-owned in law by all of the partners, and no occasion may arise for equity to require a distinction to be drawn between the legal title and the beneficial interest121. Partnership property that is an interest in 118 Sharp v The Union Trustee Co of Australia Ltd (1944) 69 CLR 539 at 551, citing In re Holland; Brettell v Holland [1907] 2 Ch 88 at 91 and In re Fuller's Contract [1933] Ch 652 at 656. 119 Canny Gabriel Castle Jackson Advertising Pty Ltd v Volume Sales (Finance) Pty Ltd (1974) 131 CLR 321 at 327-328, quoting In re Fuller's Contract [1933] Ch 652 at 656. See also Inland Revenue Commissioners v Gray (surviving executor of Lady Fox deceased) [1994] STC 360 at 377. 120 Section 32 of the Western Australian Partnership Act. 121 Commissioner of State Taxation (SA) v Cyril Henschke Pty Ltd (2010) 242 CLR 508 at 517 [25], referring to Livingston v Commissioner of Stamp Duties (Q) (1960) 107 CLR 411 at 453 and Commissioner of Stamp Duties (Q) v Livingston (1964) 112 CLR 12 at 22; [1965] AC 694 at 712. land122 or that is other real or personal property legal title to which is held by only one partner or by only some of the partners123 is held and devolves according to the incidents of the legal title by which it is held but on trust for all of the partners as co-owners in equity. The nature of the undivided interest that each partner has as a co-owner (whether in law or in equity) of each item of partnership property (whether real or personal) is that of a tenant in common with all of the other partners124. The critical question is as to how and when the share of each partner in that tenancy in common in each item of partnership property is to be ascertained. Unlike under the prototypical Partnership Act 1890 (UK) and cognate legislation elsewhere in Australia, the Western Australian Partnership Act speaks directly to that question. Under the heading "Meaning of 'partner's share'", it provides125: "The share of a partner in the partnership property at any time is the proportion of the then existing partnership assets to which he would be entitled if the whole were realised and converted into money, and after all the then existing debts and liabilities of the firm had been discharged." A provision in those terms in a modern statute might easily be read as doing no more than giving meaning to references to partnership shares in other operative provisions of the statute. In the context of the statute in which it appears, it is apparent that the provision has independent operation. The statutory language is drawn almost word for word from Sir Frederick Pollock's Digest of the Law of Partnership. In the year of enactment of the Western Australian Partnership Act, the Digest was in its sixth edition. The Digest recorded Pollock's view that "[i]t is not quite clear whether the interest of partners in the partnership property is more correctly described as a tenancy in common or a joint tenancy without benefit of survivorship", to which Pollock added that "the difference appears to be merely verbal"126. Against the marginal 122 Section 30(2) of the Western Australian Partnership Act. 123 Carter Bros v Renouf (1962) 111 CLR 140 at 162-163. 124 Knox v Gye (1872) LR 5 HL 656 at 679; Chan v Zacharia (1984) 154 CLR 178 at 194. See also Morse, Partnership Law, 6th ed (2006) at 209 [6.05]. 125 Section 33 of the Western Australian Partnership Act. 126 Pollock, A Digest of the Law of Partnership, 6th ed (1895) at 67. note "What is a partner's share", Pollock included in the Digest the following definition127: "The share of a partner in the partnership property at any given time may be defined as the proportion of the then existing partnership assets to which he would be entitled if the whole were realized and converted into money, and after all the then existing debts and liabilities of the firm had been discharged." In support of that definition, Pollock referenced the contemporaneous edition of Sir Nathaniel Lindley's Treatise on the Law of Partnership128 and went on to give the following illustration with reference to Farquhar v Hadden129: "F and L are partners and joint tenants of offices used by them for their business. F dies, having made his will, containing the following bequest: 'I bequeath all my share of the leasehold premises ... in which my business is carried on ... to my partner, L.' Here, since the tenancy is joint at law, 'my share' can mean only the interest in the property which F had as a partner at the date of his death – namely, a right to a moiety, subject to the payment of the debts of the firm; and if the debts of the firm exceed the assets, L takes nothing by the bequest." The illustration employed the language of joint tenancy to describe the beneficial interests of partners in partnership property rather than the language of tenancy in common, but that was against the background of its author having earlier made clear that he did not think it significant in the context of the law of partnership to draw any substantive distinction between those two forms of co-ownership. Each subsequent edition of the Digest retained the definition and the illustration. However, each edition published after 1907 added an important qualification in a footnote: "But if the other partnership assets exceed the debts, the beneficiaries under the will are bound, as between themselves, to give effect to the disposition"130. That qualification was added with reference to In re 127 Pollock, A Digest of the Law of Partnership, 6th ed (1895) at 69. 128 Lindley, A Treatise on the Law of Partnership, 6th ed (1893) at 348. 129 (1871) LR 7 Ch App 1. 130 eg, Gower, Pollock on the Law of Partnership, 15th ed (1952) at 67, footnote 71. Holland; Brettell v Holland ("Re Holland")131, to which it will be necessary to return. The present significance of the Western Australian Partnership Act's statutory adoption of Pollock's definition of a partnership share is that it resolves an ambiguity inherent in the frequently cited statement of Lindley in the passage in his Treatise on the Law of Partnership which Pollock referenced in the Digest. Lindley's statement was that "[w]hat is meant by the share of a partner is his proportion of the partnership assets after they have been all realised and converted into money, and all the debts and liabilities have been paid and discharged"132. The statement has been echoed judicially133. The ambiguity inherent in the statement lies in its temporal dimension. Does it mean that the share of a partner is capable of being ascertained only at such time as all of the partnership property has in fact been liquidated and all of the partnership debts and liabilities have in fact been paid so that the only remaining partnership property is a pool of money constituting the net proceeds of the liquidation which are available for distribution? Or does it merely provide a formula by which the existing share of a partner in an existing item of partnership property can be ascertained at an earlier time? There have been dicta in subsequent cases, including in this Court134, which have suggested the former position. That position is preferred in the current edition of Lindley & Banks on Partnership135. Equally, there have been 132 Lindley, A Treatise on the Law of Partnership, 6th ed (1893) at 348-349 (original emphasis). 133 eg, Bakewell v Deputy Federal Commissioner of Taxation (SA) (1937) 58 CLR 134 Livingston v Commissioner of Stamp Duties (Q) (1960) 107 CLR 411 at 453, quoting Rodriguez v Speyer Brothers [1919] AC 59 at 68; Watson v Ralph (1982) 148 CLR 646 at 650, quoting Livingston v Commissioner of Stamp Duties (Q) (1960) 107 CLR 411 at 453; Commissioner of State Taxation (SA) v Cyril Henschke Pty Ltd (2010) 242 CLR 508 at 517 [25], referring to Livingston v Commissioner of Stamp Duties (Q) (1960) 107 CLR 411 at 453. See also Popat v Shonchhatra [1997] 1 WLR 1367 at 1372; [1997] 3 All ER 800 at 804; Sandhu v Gill [2006] Ch 456 at 462-463 [18]. 135 Banks, Lindley & Banks on Partnership, 20th ed (2017) at 703-705 dicta, including in this Court136, which have suggested the latter position. The tension between the two positions was noticed by Fullagar J in Maslen v Perpetual Executors Trustees & Agency Co (WA) Ltd137. In the same case, which was an appeal from the Supreme Court of Western Australia, Kitto J recognised that the Western Australian Partnership Act's adoption of Pollock's definition indicates the latter position138. The definition says "at any time is" and "would be entitled if"; it does not say "will be entitled when". His Honour stated that the definition did "no more than give statutory effect to the view always maintained by the courts"139. That was an overstatement in so far as it made no allowance for those dicta which had suggested the former position. Nevertheless, the statement was accurate in so far as it indicated that authority favoured Pollock's definition independently of its specific statutory adoption. The precise share that each partner at any time has in each item of partnership property is required by the definition to be ascertained by hypothesising the immediate liquidation of all partnership property and the immediate payment of all partnership debts and liabilities. The proportionate share that the partner at that time has in the partnership property and in each item of partnership property is equivalent to the proportionate share of the surplus to which each partner would be entitled under the partnership agreement in that hypothesised scenario. For so long as the partnership is carrying on business, or at least for so long as assets or liabilities of the partnership are turning over or are in prospect of turning over, the legal or beneficial interest of each partner in each item of partnership property necessarily remains unascertained. The share of each partner 136 Sharp v The Union Trustee Co of Australia Ltd (1944) 69 CLR 539 at 551; Maslen v Perpetual Executors Trustees & Agency Co (WA) Ltd (1950) 82 CLR 101 at 129, quoting Manley v Sartori [1927] 1 Ch 157 at 163-164; Hendry v The Perpetual Executors and Trustees Association of Australia Ltd (1961) 106 CLR 256 at 266, quoting Burdett-Coutts v Inland Revenue Commissioners [1960] 1 WLR 1027 at 1035; [1960] 3 All ER 153 at 159. 137 (1950) 82 CLR 101 at 119-120. The decision in Maslen v Perpetual Executors Trustees & Agency Co (WA) Ltd was reversed on appeal to the Privy Council in Perpetual Executors Trustees & Agency Co (WA) Ltd v Maslen (1951) 88 CLR 138 (1950) 82 CLR 101 at 129. See also at 112. 139 (1950) 82 CLR 101 at 129. is not "a fixed proportion" that is "immediately ascertainable" but is rather "an indefinite and fluctuating interest, which at any given moment is in proportion to his share in the ultimate surplus coming to him if at that moment the partnership were wound up and its accounts taken"140 and which might change from moment to moment. But even then, the share of each partner is "'an unascertained interest in every single asset of the partnership, and it is not right to regard him as being merely entitled to a particular sum of cash ascertained from the balance-sheet of the partnership as drawn up at the date of' dissolution"141. Once the partnership is dissolved, however, the reckoning required to fix the proportionate legal or beneficial interest of each partner in each item of partnership property can occur without actual liquidation of the partnership property and without actual payment of the partnership debts and liabilities. For the share of each partner in each item of partnership property then to be ascertained, it is sufficient that the liquidated value of the partnership property as a whole be certain to exceed the value of the partnership debts and liabilities as a whole. It is sufficient, in other words, that the partnership be solvent on dissolution. Provided a partnership is solvent, the result is that "when a dissolved partnership is to be, or is in course of being, wound up, each partner or his estate retains an interest in every single asset of the former partnership which remains unrealised or unappropriated, and that that interest is proportionate to his share in the totality of the surplus assets of the partnership"142. Though a particular item of partnership property might remain unrealised and unappropriated until the completion of the winding up, the partner's proportionate share in that item is by that time fixed. Support for that position is to be found in the outcomes of and the reasoning contained in the two decisions of which I am aware that come closest to squarely confronting the question. The first is the decision of the Chancery Division of the English High Court of Judicature in Re Holland, which was referenced in later editions of the Digest, and which has been repeatedly cited 140 Sharp v The Union Trustee Co of Australia Ltd (1944) 69 CLR 539 at 551; Perpetual Executors & Trustees Association of Australia Ltd v Federal Commissioner of Taxation (Thomas' Case No 2) (1955) 94 CLR 1 at 27-28. 141 Maslen v Perpetual Executors Trustees & Agency Co (WA) Ltd (1950) 82 CLR 101 at 129, quoting Manley v Sartori [1927] 1 Ch 157 at 163-164. 142 Hendry v The Perpetual Executors and Trustees Association of Australia Ltd (1961) 106 CLR 256 at 266, quoting Burdett-Coutts v Inland Revenue Commissioners [1960] 1 WLR 1027 at 1035; [1960] 3 All ER 153 at 159. with approval in this Court143. The second is the decision of the Privy Council, on appeal from the Supreme Court of Western Australia144, in Cameron v Murdoch145. The material facts of Re Holland and Cameron v Murdoch were identical. There had been a will in which a deceased partner had made a specific disposition of the partner's share in specified property which happened to be partnership property. The winding up of the partnership had commenced following the dissolution of the partnership on the death of the partner but was not complete. The other assets of the partnership upon dissolution were found to be sufficient to discharge the debts and liabilities of the partnership. In both cases an argument was put to the effect that the testamentary disposition was ineffective because the partner's share necessarily remained unascertained until winding up of the partnership was complete146. In both cases, the argument was rejected. In both cases, the disposition was held to be effective to pass the partner's interest in the property to the beneficiaries under the will. And in both cases the interest was determined to be a proportionate share of the specified property that was fixed by reference to the proportionate share to which the partner was entitled in the totality of the surplus assets of the partnership147. The reasoning in Re Holland expressly distinguished Farquhar v Hadden on the basis that the partnership in Farquhar v Hadden had been insolvent on dissolution whereas the partnership in Re Holland was solvent on dissolution148. The reasoning in Cameron v Murdoch similarly proceeded on the express basis that the fact that the assets of the partnership were adequate to discharge the debts and liabilities of the partnership was sufficient to allow the interest to be 143 Sharp v The Union Trustee Co of Australia Ltd (1944) 69 CLR 539 at 551, cited in Maslen v Perpetual Executors Trustees & Agency Co (WA) Ltd (1950) 82 CLR 101 at 129 (cf at 120); Livingston v Commissioner of Stamp Duties (Q) (1960) 107 CLR 411 at 453; Haque v Haque [No 2] (1965) 114 CLR 98 at 130. 144 Cameron v Murdoch [1983] WAR 321. 145 (1986) 60 ALJR 280; 63 ALR 575. 146 [1907] 2 Ch 88 at 90; (1986) 60 ALJR 280 at 293; 63 ALR 575 at 597. 147 [1907] 2 Ch 88 at 91; (1986) 60 ALJR 280 at 293; 63 ALR 575 at 597-598. 148 [1907] 2 Ch 88 at 91. ascertained at the date of the court order declaring the entitlement of the beneficiary149. Turning to the circumstances of the present case, two facts are critical. The first is that, at the time of execution of the SIC Deed and the AMS Deed, the SIC Partnership and the AMS Partnership had been dissolved. The second is that the value of the partnership property of each of those partnerships was sufficient to discharge the debts and liabilities. That is to say, the partnerships were solvent. In those circumstances, the proportionate share of each partner in the totality of the surplus assets of the SIC Partnership and the AMS Partnership was calculable in accordance with the SIC Deed of Partnership and the AMS Deed of Partnership. The proportionate share of each partner in the totality of the surplus assets of each partnership as then so calculable was also the proportionate share of each partner in each item of partnership property, which included the totality of the beneficial interest in each parcel of land held on trust for the partnerships The proportionate share of each partner in the beneficial interest in the real property as in fact so calculated was correctly stated in cl 1 of each of the SIC Deed and the AMS Deed. The proportionate shares thereafter specified in respect of former partners and testamentary beneficiaries of former partners in cl 3 of each of the SIC Deed and the AMS Deed did no more than reflect the proportionate share of each partner as subjected to the testamentary dispositions effected by cl 2 and cl 3A150. By "confirm[ing]" the respective shares of the former partners and testamentary beneficiaries of former partners in the land held on trust by Maria Scolaro for the SIC Partnership and the AMS Partnership respectively, cl 3 of each of the SIC Deed and the AMS Deed did no more than acknowledge the legal position that had then come to exist: that Maria Scolaro held the land in trust for the former partners and beneficiaries in the specified shares by operation of law. She did not declare a new trust. She therefore did not by that confirmation engage in a dutiable transaction. The continuation of each trust implicit in the replacement by cl 4 of each of the SIC Deed and the AMS Deed of Maria Scolaro with Rojoda as trustee indicated the agreement of all of the former partners and testamentary beneficiaries that the lands would not be liquidated. The agreement necessarily 149 (1986) 60 ALJR 280 at 293; 63 ALR 575 at 597-598. 150 See Rojoda Pty Ltd v Commissioner of State Revenue (2018) 368 ALR 734 at 748 released the parties from the obligations arising from the AMS Deed of Partnership and the SIC Deed of Partnership to sell those assets. There is no suggestion that the releases were sufficient to render the SIC Deed and the AMS Deed dutiable. The conclusion that the critical clause in each of the SIC Deed and the AMS Deed did no more than acknowledge the legal position that had come to exist on dissolution of the SIC Partnership and the AMS Partnership does not depend on anticipation of steps yet to occur in the course of the winding up. It does not depend on a distorted application of the maxim that equity regards as done that which ought to be done. It relevantly involves nothing more than recognising, as ascertainable and as ascertained, the fixed share that each partner on dissolution of each solvent partnership had as a tenant in common in the beneficial interest in the land held on trust for the partnership determined in accordance with the statutorily prescribed hypothesis, all of the integers required for the application of which were then known. For these reasons, I would uphold the notice of contention and dismiss the appeal with costs.

HIGH COURT OF AUSTRALIA MATTHEW WARD PRICE AS EXECUTOR OF THE ESTATE OF ALAN LESLIE PRICE (DECEASED) & ORS APPELLANTS AND CHRISTINE CLAIRE SPOOR AS TRUSTEE & ORS RESPONDENTS Price v Spoor [2021] HCA 20 Date of Hearing: 4 March 2021 Date of Judgment: 23 June 2021 ORDER Appeal dismissed with costs. On appeal from the Supreme Court of Queensland Representation T Matthews QC with D D Keane and J K Carter for the appellants (instructed by MA Kent & Associates) N Andreatidis QC with A F Messina and S J Gibson for the respondents (instructed by Mullins Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Price v Spoor Limitation of actions – Exclusion by agreement – Where mortgages over land secured loan – Where mortgagors failed to repay loan – Where mortgagees brought proceedings to recover monies owing and possession of land secured by mortgages – Where mortgagors contended mortgagees statute-barred from enforcing rights under mortgages as a result of expiry of relevant time period under Limitation of Actions Act 1974 (Qld) ("Act") – Where mortgagors contended mortgagees' title under mortgages extinguished by operation of s 24 of Act – Where mortgagees contended that mortgagors agreed not to plead any defence under Act by virtue of cl 24 of mortgages – Whether cl 24 effective to prevent mortgagors from pleading any defence under Act – Whether agreement not to plead any defence under Act unenforceable as contrary to public policy – Whether s 24 of Act operated automatically to extinguish mortgagees' title at expiry of relevant time period – Whether mortgagees' remedy confined to damages for mortgagors' breach of cl 24 of mortgages. Words and phrases – "action", "agreement", "agreement not to plead", "benefit", "breach of contract", "contracting out", "defeated", "defence", "defence of limitation", "expiry", "extinguishment of title", "finality of litigation", "jurisdiction of the court", "limitation period", "limitations defence", "plea", "public interest", "public policy", "reasonable business person", "remedy", "shall not be brought", "statute-barred", "statute of limitations", "statutory bar", "statutory right", "waiver". Limitation of Actions Act 1974 (Qld), ss 10, 13, 24, 26. KIEFEL CJ AND EDELMAN J. The Limitation of Actions Act 1974 (Qld) ("the Limitation Act") contains provisions which prescribe the time within which actions founded upon simple contract or for the recovery of land or monies secured by a mortgage over land shall be brought. The principal question on this appeal is whether the parties to a mortgage may agree that the mortgagor will not plead the statutory limitation by way of defence to an action brought by the mortgagee or whether such an agreement is unenforceable as contrary to public policy. A second question concerns the operation of a provision of the Limitation Act respecting extinguishment of title. A third concerns the terms of a clause in the mortgages in question and whether they are effective to prevent the appellants from pleading the statutory time limitation. These questions arose in proceedings brought in 2017 in the Supreme Court of Queensland by the respondents as mortgagees in which they claimed more than $4 million as monies owing under and secured by two mortgages, together with recovery of possession of land the subject of the mortgages. By way of defence and counterclaim, the appellants alleged that the respondents were statute-barred from bringing the action for debt pursuant to ss 10, 13 and 26 of the Limitation Act. The respondents were in consequence said to be barred from enforcing any rights under the mortgages. Two appellants further alleged that the respondents' title under the mortgages had been extinguished. In reply, the respondents relied on cl 24 of each mortgage, which they contended amounted to a covenant on the part of the appellants not to plead a defence of limitation. As a result it was said that the appellants were estopped from pleading it. The respondents might have described the abandonment of reliance on the statutory right which they allege was effected by the agreement as a waiver by the appellants of that right1. On the hearing of their application for summary judgment or for a strike out of the defences the respondents conceded that if the Limitation Act applied their claims would be defeated. The primary judge (Dalton J) dismissed the application and entered judgment for the appellants2. The Court of Appeal allowed the appeal from that decision and subsequently gave judgment for the respondents and made other orders3. 1 Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management and Marketing Pty Ltd (2013) 250 CLR 303 at 315 [30]; see also The Commonwealth v Verwayen (1990) 170 CLR 394 at 406-407 per Mason CJ. Spoor v Price [2019] QSC 53. Spoor v Price (2019) 3 QR 176. Edelman The Limitation Act provisions and their effect Section 10(1)(a) of the Limitation Act in its relevant part provides that: "(1) The following actions shall not be brought after the expiration of 6 years from the date on which the cause of action arose – (a) … an action founded on simple contract …" Section 13 provides: "An action shall not be brought by a person to recover land after the expiration of 12 years from the date on which the right of action accrued to the person or, if it first accrued to some person through whom the person claims, to that person." The provision which relates to the extinguishment of title upon which the appellants rely is s 24(1), which relevantly provides: "… where the period of limitation prescribed by this Act within which a person may bring an action to recover land … has expired, the title of that person to the land shall be extinguished." Section 26 deals with actions to recover money secured by a mortgage or to recover proceeds from the sale of the land. In WorkCover Queensland v Amaca Pty Ltd4, five members of this Court explained the effect of statutes of limitation by reference to what had been said by Gummow and Kirby JJ in The Commonwealth v Mewett5. In Mewett, their Honours said that in the case of a statute of limitations in the traditional form a statutory bar does not go to the jurisdiction of the court to entertain the claim but rather to the remedy available, and therefore to the defences which may be pleaded. The cause of action is not extinguished by the statute and unless a defence relying on the statute is pleaded, the statutory bar does not arise for the consideration of the court. (2010) 241 CLR 420 at 433 [30] per French CJ, Gummow, Crennan, Kiefel and (1997) 191 CLR 471 at 534-535; see also The Commonwealth v Verwayen (1990) 170 CLR 394 at 404 per Mason CJ. Edelman What was said in Mewett accords with the reasons of Mason CJ in The Commonwealth v Verwayen6. Speaking there of then s 5(6) of the Limitation of Actions Act 1958 (Vic)7 ("the Victorian Limitation Act"), his Honour said that although the terms of that provision are capable of being read as going to the jurisdiction of the court, limitation provisions of this kind have not been held to have that effect. Instead they have been held to bar the remedy but not the right and thereby create a defence to the action which must be pleaded8. These statements have been applied with approval on a number of occasions in this Court9. Mason CJ went on to observe10 that since the right to plead a limitations defence is conferred by statute a contention that the right is susceptible of waiver "hinges on the scope and policy" of the Victorian Limitation Act. The same may be said of the question whether a person may abandon the statutory right to plead a defence of limitation, by agreement. Public policy In Westfield Management Ltd v AMP Capital Property Nominees Ltd11 it was accepted that a person upon whom a statute confers a right may waive or renounce that right unless it would be contrary to the statute to do so. Most clearly (1990) 170 CLR 394 at 405. Section 5(6) provided: "No action for damages for negligence …, where the damages claimed by the plaintiff consist of or include damages in respect of personal injuries to any person, shall be brought after the expiration of three years after the cause of action accrued." 8 Citing Dawkins v Lord Penrhyn (1878) 4 App Cas 51 at 58-59; The Llandovery Castle [1920] P 119 at 124; Dismore v Milton [1938] 3 All ER 762; Ronex Properties Ltd v John Laing Construction Ltd [1983] QB 398; Ketteman v Hansel Properties Ltd [1987] AC 189 at 219. 9 Georgiadis v Australian and Overseas Telecommunications Corporation (1994) 179 CLR 297 at 305; Berowra Holdings Pty Ltd v Gordon (2006) 225 CLR 364 at 372 [20], 373-374 [24]-[25]; Brisbane City Council v Amos (2019) 266 CLR 593 at 615-616 [49]; Minister for Home Affairs v DMA18 (2020) 95 ALJR 14 at 18 [4], 23 [30]; 385 ALR 16 at 19, 26. 10 The Commonwealth v Verwayen (1990) 170 CLR 394 at 405. (2012) 247 CLR 129 at 143-144 [46] per French CJ, Crennan, Kiefel and Bell JJ. Edelman this may be the case where the statute contains an express prohibition against "contracting out" of rights or where the statute, properly construed, is inconsistent with a person's power to forgo statutory rights. The joint judgment continued: "It is the policy of the law that contractual arrangements will not be enforced where they operate to defeat or circumvent a statutory purpose or policy according to which statutory rights are conferred in the public interest, rather than for the benefit of an individual alone. The courts will treat such arrangements as ineffective or void". As the Court of Appeal observed12, a similar approach has been taken by courts in the United Kingdom13, Canada14 and New Zealand15. The appellants rely upon the public interest in the finality of litigation as the policy which the Limitation Act pursues. The finality of litigation, they contend, was the mischief to which the Jacobean statute of 162316, which is the origin of statutes such as the Limitation Act, was directed. Tracing the 1623 Act to the Limitation Act of 1974, in Brisbane South Regional Health Authority v Taylor17, McHugh J said that a motive for the legislature to impose a limitation period was that "the public interest requires that disputes be settled as quickly as possible"; and that a limitation period "represents the legislature's judgment that the welfare of society is best served by causes of action being litigated within the limitation period". There can be no doubt that a policy of finality of litigation accounts for the provision made by the legislatures for limiting the period within which certain actions should be commenced in the courts. Provisions of this kind are conducive to the orderly administration of justice and are in the public interest, as it may be expected many statutes are. But as Mason CJ explained in Verwayen, the issue 12 Spoor v Price (2019) 3 QR 176 at 188 [37] per Gotterson JA, Sofronoff P and 13 Kammins Ballrooms Co Ltd v Zenith Investments (Torquay) Ltd [1971] AC 850 at 14 Tolofson v Jensen [1994] 3 SCR 1022 at 1073. 15 Auckland Harbour Board v Kaihe [1962] NZLR 68 at 87-88. 16 21 Jac I c 16. (1996) 186 CLR 541 at 551-553. Edelman concerning whether a statutory right is capable of waiver18, or abandonment by other means19, is not whether the provisions in question are beneficial to the public, but rather whether they are "not for the benefit of any individuals or body of individuals, but for considerations of State"20. The "critical question", he said, "is whether the benefit is personal or private or whether it rests upon public policy or Mason CJ concluded22 that by giving defendants a right to plead the expiry of the relevant time period as a defence, rather than imposing a jurisdictional restriction, the purpose of the Victorian Limitation Act could be discerned as one to confer a benefit on individuals "rather than to meet some public need which must be satisfied to the exclusion of the right of access of individuals to the courts". It was therefore possible, in his Honour's view, to "contract out" of statutory provisions of that kind. In the present case the Court of Appeal observed that there appears to be no authority in Australia dealing directly with the question whether a contractual provision not to plead a limitations defence, entered into for consideration before a cause of action to which it might be pleaded, is void against public policy. As a result the Court turned to what Mason CJ had said in Verwayen as a "judicial observation[] at the highest level" and concluded that such a provision is not, for that reason, void23. The appellants contend that the Court of Appeal were wrong in so concluding but they do not point to any error in the reasoning of Mason CJ which was adopted by the Court. They submit that his Honour's reasons in this respect lack precedential value. It may be accepted that what was said by Mason CJ respecting waiver or contracting out of the statutory right given by s 5(6) of the Victorian Limitation Act was not necessary to the ultimate decision in Verwayen, that the Commonwealth was estopped from disputing its liability to the plaintiff and that it 18 The Commonwealth v Verwayen (1990) 170 CLR 394 at 405. 19 See The Commonwealth v Verwayen (1990) 170 CLR 394 at 406. 20 The Commonwealth v Verwayen (1990) 170 CLR 394 at 405, citing Admiralty Commissioners v Valverda (Owners) [1938] AC 173 at 185. 21 The Commonwealth v Verwayen (1990) 170 CLR 394 at 405. 22 The Commonwealth v Verwayen (1990) 170 CLR 394 at 405-406. 23 Spoor v Price (2019) 3 QR 176 at 186-187 [34]. Edelman should be held to the state of affairs it had created by the application of an earlier policy not to contest liability or plead a limitations defence. In the passages referred to above, Mason CJ was dealing with the plaintiff's alternative argument, that the Commonwealth had waived the benefit of the statutory right to defend on the basis of the time limitation24. This was an argument to which the Commonwealth responded25. It follows that what was said by Mason CJ in Verwayen on the subject was no "mere passing remark, or a statement or assumption on some matter that has not been argued"26. It was a considered judgment on a point argued by the parties, one which fulfils Sir Robert Megarry's description as having "a weight nearer" to ratio decidendi than an obiter dictum27. There was only one aspect of Mason CJ's reasons which had not been dealt with in the authorities concerning limitation provisions of the kind in question. It was the conclusion that his Honour reached that such provisions are not dictated by public policy to the exclusion of individual rights and that the benefit conferred by statute on a defendant was of a nature that it could be given up. Both propositions are clearly correct and have since been cited by intermediate courts28. The first follows from the way in which the legislatures have dealt with the public interest in the finality of litigation, by leaving it to a defendant to raise the application of a statute's time-bar. On this topic there is no dispute amongst the decided cases. The second follows from what has been said about the right or benefit which limitation statutes give to a defendant and the fact that the defendant may choose whether to plead a statute. Extinguishment Section 24 of the Limitation Act provides, in effect, that where the time prescribed by the Act within which a person "may bring an action" to recover land has expired, the person's "title" to that land "shall be extinguished". The time for bringing such an action is prescribed by s 13. The title to the land here in question is that of a registered mortgagee of land. "[L]and" is defined to include "any legal 24 The Commonwealth v Verwayen (1990) 170 CLR 394 at 402, 404. 25 The Commonwealth v Verwayen (1990) 170 CLR 394 at 399-400. 26 Brunner v Greenslade [1971] Ch 993 at 1002-1003 per Megarry J. 27 Brunner v Greenslade [1971] Ch 993 at 1003 per Megarry J. 28 Beba Enterprises Pty Ltd v Gadens Lawyers (2013) 41 VR 590 at 608 [81]-[82]; Rae & Partners Pty v Shaw [2020] TASFC 14 at [131]. Edelman or equitable estate or interest therein"29, which encompasses a registered By contrast with provisions such as s 13, s 24 operates to extinguish rights, not create them. The appellants contend that the respondents' title to the land was extinguished by the operation of s 24 before the proceedings in the Supreme Court were commenced. The argument was not fully developed but the appellants may be understood to suggest that s 24 operated automatically at the end of the limitation period to extinguish the respondents' interest in the land as mortgagee regardless of whether the appellants pleaded the limitation period by way of defence. That is to say, s 24 is to be understood to operate independently of s 13, rather than providing for what follows from a successful plea. Textually there are strong indications that s 24 operates by reference to the plea. Section 13 says that "[a]n action shall not be brought" to recover land after the expiration of 12 years. Consistently with the authorities earlier referred to, in Brisbane City Council v Amos30, Keane J observed that the term "shall not be brought" has been given a special meaning by the courts, one which is to be understood to refer to the defence provided by the statute, but which must be pleaded if effect is to be given to the limitation on bringing the action. The point presently to be made is that s 24, in its terms, proceeds upon the same footing. It also refers to the limitation period as that within which a person "may bring an action" to recover land. It contemplates a plea of the time-bar being made under s 13 and being given effect. There is also some historical support for this construction. The words "bringing any ... [a]ction" were used in the English Real Property Limitation Act 183331, in the provision which was the precursor to s 2432. Prior to that provision being re-enacted in the Limitation Act 1939 (UK), the report of the Law Revision Committee spoke of the need for "clearing the title" as being of importance with 29 Limitation Act, s 5(1). (2019) 266 CLR 593 at 615-616 [49]. 31 3 & 4 Wm IV c 27. Edelman respect to the land33. There would be no need to clear a title if the provision took effect without the defence of limitation being raised. Further support for the view that s 24 is not intended to operate automatically and independently of s 13 at the expiry of the limitation period is provided by considerations of utility. If a provision such as s 24 automatically extinguished title there would seem to be no utility to the requirement affecting s 13 that a defendant must raise the defence in order to defeat a claim. If s 24 operated in the way contended for, there would remain no right or title in respect of which a remedy could be given. This appears to be the point made by the New South Wales Law Reform Commission in its 1971 Report on the Limitation of Actions34. The construction of cl 24 Clause 24 of each mortgage provides: "The Mortgagor covenants with the Mortgage[e] that the provisions of all statutes now or hereafter in force whereby or in consequence whereof any o[r] all of the powers rights and remedies of the Mortgagee and the obligations of the Mortgagor hereunder may be curtailed, suspended, postponed, defeated or extinguished shall not apply hereto and are expressly excluded insofar as this can lawfully be done." An objective approach is required to determine the rights and liabilities of a party to a commercial contract, by reference to its text, context and purpose. The meaning to be given to its terms is determined by reference to what a reasonable business person would have understood those terms to mean35. Clause 24 is expressed to apply to all statutes affecting the mortgagee's rights and remedies and the obligations of the mortgagor. The effects spoken of include the defeat or extinguishment of rights. Where this occurs, the parties agree 33 Law Revision Committee, Fifth Interim Report (Statutes of Limitation) (1936) Cmd 5334 at 34-35. 34 New South Wales Law Reform Commission, Second Report on the Limitation of Actions, LRC 12 (1971) at 11 [14]. 35 Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640 at 656-657 [35]. See also Simic v New South Wales Land and Housing Corporation (2016) 260 CLR 85 at 111 [78]; Ecosse Property Holding Pty Ltd v Gee Dee Nominees Pty Ltd (2017) 261 CLR 544 at 551 [16]-[17], 554-555 [24]-[25]. Edelman that the statute "shall not apply hereto" and shall be regarded as "expressly excluded". The word "defeat" is apt to capture the effect of limitation provisions, as the Court of Appeal observed36. It is often used in this context. In Verwayen37, Brennan J spoke of whether the limitation provision had been abandoned so that it was beyond the capacity of the Commonwealth to "defeat" the plaintiff's claim by invoking the provision. McHugh J38 likewise framed the question as whether the Commonwealth could rely on the statute to "defeat" the plaintiff's claim. The fact that the Limitation Act does not of itself have the effect of defeating the respondents' rights to claim under the mortgages and that a plea by the appellants is required to do so does not take the matter outside the purview of the clause. It is clear that the parties intended that it have a wide operation and that it extend to any consequences flowing from a statutory provision ("whereby or in consequence whereof") which would defeat the mortgagee's rights. It was clearly intended that provisions which might have that result were not to apply to affect the rights and obligations of the parties. It is not difficult to infer that it was intended to apply to a benefit given by statute to a defendant by which the mortgagee's right could be defeated. By agreeing to the terms of cl 24 the appellants effectively gave up the benefit provided by the Limitation Act. The appellants' reliance on the concluding words of the clause, "insofar as this can lawfully be done", takes the matter no further. As has been explained, an agreement that the appellants not rely upon the benefit given by the Limitation Act is enforceable. Damages only? The appellants also submit that an agreement not to plead the statute may give rise to an action for breach of the agreement, but the agreement will not itself "prevent the pleading, and the operation, of the statute of limitations". The submission relies upon the decision of the Privy Council in East India Company v Oditchurn Paul39. 36 Spoor v Price (2019) 3 QR 176 at 192 [64]. 37 The Commonwealth v Verwayen (1990) 170 CLR 394 at 426. 38 The Commonwealth v Verwayen (1990) 170 CLR 394 at 504. (1849) 7 Moo PC 85 [13 ER 811]. Edelman That case concerned the non-delivery of salt which had been purchased by the respondent. Rather than commence an action for breach of contract the purchaser sought to negotiate a refund and the matter became the subject of inquiries, instigated by the appellant, over the course of some years. When the purchaser finally sued for breach of contract the appellant pleaded the Statute of Limitations, although it had been largely responsible for the delays. The question for the Privy Council was when the cause of action arose. Lord Campbell observed40 that nothing in the circumstances of the case could affect the operation of the statute. The purchaser, however, contended that the subsequent negotiations and inquiries had the effect of suspending the operation of the statute for a time but could point to no authority in support of that contention. In the passage on which the appellants rely41, Lord Campbell said: "There might be an agreement that in consideration of an inquiry into the merits of a disputed claim, advantage should not be taken of the Statute of Limitations in respect of the time employed in the inquiry, and an action might be brought for breach of such an agreement; but if to an action for the original cause of action the Statute of Limitations is pleaded, upon which issue is joined … the Defendant, notwithstanding any agreement to inquire, is entitled to the verdict." There was no such agreement between the parties concerning the Statute of Limitations and Lord Campbell's observation about the effect of the hypothetical agreement on the operation of the statute forms no part of the decision of the Privy Council. As to the correctness of its implication, that even a binding agreement cannot prevent the statute taking effect, no explanation is given as to why such an agreement could not be enforced. It appears to proceed from a misapprehension about the operation of a limitations provision. At an earlier point in the judgment42, his Lordship said that once the cause of action "began to run ... nothing could stop it", even if there was fraud on the part of the defendant. Such an opinion does not acknowledge, in accordance with more modern authority, that the statutory bar is not raised for the court's consideration unless and until a defence is pleaded and 40 East India Company v Oditchurn Paul (1849) 7 Moo PC 85 at 111 [13 ER 811 at 41 East India Company v Oditchurn Paul (1849) 7 Moo PC 85 at 112 [13 ER 811 at 42 East India Company v Oditchurn Paul (1849) 7 Moo PC 85 at 111 [13 ER 811 at Edelman that a defendant has a choice whether to do so. A defendant may bargain away the statutory right and that bargain may be enforced. Orders The appeal should be dismissed with costs. GagelerJ GAGELER AND GORDON JJ. We agree that the appeal should be dismissed, substantially for the reasons given by Kiefel CJ and Edelman J. The principal question in this appeal is whether cl 24 of each mortgage is void and unenforceable as contrary to the public policy underpinning the Limitation of Actions Act 1974 (Qld) ("the Limitation Act"). That question raises a preliminary point of contractual construction and a subsidiary question about the appropriate relief if a party breaches a covenant not to rely upon a limitation defence. The question of construction is whether cl 24, properly construed, means that ss 10 and 13 of the Limitation Act do "not apply ... and are expressly excluded". Whether a party may, by contract, forbear or renounce rights conferred by a statute directs attention to the proper construction of the statute in issue to identify whether there is "an express prohibition against 'contracting out'"; or whether "the provisions of the statute, read as a whole, are inconsistent with a power to forgo its benefits"; or whether "the policy and purpose of the statute may [show] that the rights which it confers on individuals are given not for their benefit alone, but also in the public interest, and are therefore not capable of being renounced"43. The Limitation Act contains no express prohibition against contracting out. And the Limitation Act, read as a whole, does not compel a different conclusion. Section 13, in its terms, provides that "[a]n action shall not be brought by a person to recover land after the expiration of 12 years from the date on which the right of action accrued to the person ...". It is in a form which, as has long been settled by judicial decision, is not to be taken literally but merely provides a defence to an action that must be pleaded by a defendant if the expiration of the limitation period is to be given effect44. It is a provision by which the remedy is barred, but not the right of the plaintiff to bring the cause of action45. Section 10 is to a similar effect. 43 Brooks v Burns Philp Trustee Co Ltd (1969) 121 CLR 432 at 456. See also Westfield Management Ltd v AMP Capital Property Nominees Ltd (2012) 247 CLR 129 44 Brisbane City Council v Amos (2019) 266 CLR 593 at 615-616 [49]. See also, eg, Berowra Holdings Pty Ltd v Gordon (2006) 225 CLR 364 at 372 [20]; Minister for Home Affairs v DMA18 (2020) 95 ALJR 14 at 18 [4], 23-24 [30]-[31]; 385 ALR 16 45 Courtenay v Williams (1844) 3 Hare 539 at 551-552 [67 ER 494 at 500]; In re Rownson; Field v White (1885) 29 Ch D 358 at 364; Jones v Bellgrove Properties Ltd [1949] 2 KB 700 at 704; Ketteman v Hansel Properties Ltd [1987] AC 189 GagelerJ Concluding that it is for the defendant to raise a limitation defence does not cut across the public policy at which limitations of actions statutes are directed, namely "finality in civil litigation"46. The way that ss 10 and 13 of the Limitation Act give effect to the Act's legislative purpose of ensuring finality in litigation – a legitimate public policy objective – is by conferring a right on an individual defendant in a particular case to elect to plead a limitation period. Once this is properly understood, enforcing a contractual agreement not to plead a limitation period is entirely compatible with the terms of the Limitation Act and the policy underpinning it: because it is always left to an individual to choose whether to forgo the right conferred by statute. The question which then arises is whether by cl 24 the parties contracted out of ss 10 and 13 of the Limitation Act. The construction of cl 24 of each mortgage is to be determined objectively by what reasonable persons in the position of the parties can be taken by adopting the words to have meant47. That requires consideration, not only of the text of the mortgage, but also of the surrounding circumstances known to the Mortgagee and the Mortgagor, and the purpose and object of the transaction48. Under each Bill of Mortgage identified land was charged "with the repayment to the Mortgagee of all sums of money" listed under an item which read "Description of debt or liability secured". The Mortgagor's covenants with the Mortgagee were set out in a Schedule attached to the Bill of Mortgage and in a document numbered L342365R (filed in the office of the Registrar of Titles) at 219; The Commonwealth v Verwayen (1990) 170 CLR 394 at 405; The Commonwealth v Mewett (1997) 191 CLR 471 at 534-535; Amos (2019) 266 CLR 593 at 599 [7]. 46 Verwayen (1990) 170 CLR 394 at 405-406. 47 Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451 at 461-462 [22], citing Gissing v Gissing [1971] AC 886 at 906; Christopher Hill Ltd v Ashington Piggeries Ltd [1972] AC 441 at 502; Australian Broadcasting Corporation v XIVth Commonwealth Games Ltd (1988) 18 NSWLR 540. See also, eg, Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640 at 656-657 [35]; Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104 at 116 [46]. 48 Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 CLR 337 at 350. See also, eg, Pacific Carriers (2004) 218 CLR 451 at 461-462 [22]; Mount Bruce Mining (2015) 256 CLR 104 at 116 [46]. GagelerJ ("the Memorandum"). That is consistent with the Bill of Mortgage being a registrable instrument operating as a security and not as a transfer of the land charged49. The Schedule to the Bill of Mortgage, headed "Mortgagor's Covenant", recorded that the Mortgagee advanced the Principal Sum to the Mortgagor on the terms and conditions set out in the Schedule. Clauses 2 to 6 set the due date for payment being the first day of each month, that the mortgage was for 12 months from the advance of the Principal Sum and that the Mortgagor had a right to repay the Principal Sum earlier than the due date upon certain conditions. By cl 7, the Mortgagor covenanted and agreed with the Mortgagee that the provisions in the Memorandum were deemed to be incorporated in and form part of the mortgage as if fully set out in the Schedule and that each provision of the mortgage (including those in the Memorandum) was deemed to be a covenant and condition between the Mortgagee and the Mortgagor within the meaning of s 76A of the Real Property Act 1861-1985 (Qld)50. The Mortgagor also covenanted and agreed to duly and punctually observe and perform each and every provision of the mortgage (including those in the Memorandum) and agreed that prior to executing the mortgage, the Mortgagor had received a copy of the mortgage and the Memorandum and read and understood the provisions. Section 76A of the Real Property Act provided for the incorporation of provisions in a registered memorandum. The Memorandum was such a registered memorandum, being a document prepared and delivered by an identified firm of solicitors in Queensland and which, when incorporated into the Bill of Mortgage, contained the standard terms and conditions of the mortgage51. The Memorandum relevantly defined "Mortgage" to mean the mortgage created by the Bill of Mortgage, the Schedule to the Bill of Mortgage and the Memorandum, which were to be "read together as a whole". The Memorandum expressly recognised that not all provisions, including for example those relating to a trustee mortgagor, where the mortgaged land was agricultural land or the guarantor provisions, were intended to apply to every Bill of Mortgage which incorporated the Memorandum. The Memorandum comprised numerous provisions, of which cl 24 was just one, covering a broad range of matters in which the Mortgagor covenanted with the Mortgagee for the benefit of the Mortgagee and to the detriment of the Mortgagor. The primacy of the Memorandum is evident on the face of the 49 Land Title Act 1994 (Qld), s 61. 50 Section 76A provided for the incorporation of provisions in a registered memorandum. 51 Real Property Act, s 76A(1). GagelerJ document. Clause 38, for example, headed "Statutory Provisions", provided that the Mortgagor covenanted with the Mortgagee "that the covenants powers and provisions implied in mortgages by virtue of statute for the time being in force shall for the purposes hereof be negatived or varied only so far as they are inconsistent with the provisions hereof and are otherwise hereby modified varied or extended so as to become consistent herewith". Consistent with that structure and purpose, by cl 24, headed "Restrictive Legislation", the Mortgagor covenanted with the Mortgagee that "the provisions of all statutes now or hereafter in force" being statutes "whereby or in consequence whereof": "any o[r] all of the powers rights and remedies of the Mortgagee and the obligations of the Mortgagor hereunder may be curtailed, suspended, postponed, defeated or extinguished shall not apply hereto and are expressly excluded insofar as this can lawfully be done". (emphasis added) On its proper construction, cl 24 is a generic "contracting out" of any statutes that would operate to limit the obligations of the Mortgagor or the powers, rights and remedies of the Mortgagee. As is apparent from the words "insofar as this can lawfully be done", the contracting out is to the maximum extent permitted by law. Exactly how the clause operates will vary from statute to statute52. In its application to ss 10 and 13 of the Limitation Act, cl 24 could not operate as an immediate renunciation or abandonment of the statutory rights of the Mortgagor to plead those sections in defence of an action by the Mortgagee. The maximum extent it could operate was as a contract not to rely on the limitation provisions, a stipulation by the Mortgagor not to plead the statute at any time up to judgment53. Contrary to the contention of the appellants, relying on the decision of the Privy Council in East India Co v Oditchurn Paul54, the Mortgagee is not confined to an action in damages in the event of the Mortgagor breaching cl 24 by pleading the sections of the Limitation Act in defence of an action by the Mortgagee. 52 Caltex Oil (Australia) Pty Ltd v Best (1990) 170 CLR 516 at 522. 53 See, eg, Verwayen (1990) 170 CLR 394 at 427; Agricultural and Rural Finance Pty Ltd v Gardiner (2008) 238 CLR 570 at 590 [61], 599 [88]; cf Newton, Bellamy and Wolfe v State Government Insurance Office (Qld) [1986] 1 Qd R 431 at 441, 444, (1849) 7 Moo PC 85 at 112 [13 ER 811 at 821-822]. GagelerJ Rejecting a contention that certain negotiations and inquiries "suspended the operation" of the limitations statute applicable to a common law action in an appeal from the discharge of an order nisi for a new trial on the "plea side" of the Supreme Court of Judicature at Calcutta55, the Privy Council in Paul referred only to the remedy available at common law had there been a breach of a contract not to rely on a limitation provision. The Privy Council did not go on to address the relief that would have been available in equity. Paul therefore did not contradict the prior holding of the Court of Chancery in Lade v Trill56 that such a contract ought to be enforced in equity. Although damages was and remains a remedy for breach of a contract not to rely on a limitation period at common law, equitable relief in the form of injunction to restrain a breach of contract was and is also an available remedy to restrain a breach of the contractual promise – in effect, a negative stipulation57. As the Court stated in Tabcorp Holdings Ltd v Bowen Investments Pty Ltd58, where a clear legal duty is imposed by contract to refrain from some act, then, prima facie, an injunction should go to restrain the doing of that act. Put in different terms, if there is a breach of such a contractual promise, specific performance of the contract may be ordered where damages would be inadequate59. Under the Judicature system which has existed in Queensland since 187660, where equity would restrain by injunction the making of a claim or the raising of a defence, the injunction need not issue. The equitable basis for the injunction can instead be pleaded directly in answer to the making of the claim or the raising of the defence61. (1849) 7 Moo PC 85 at 111 [13 ER 811 at 821]. (1842) 11 LJ Ch 102. 57 Doherty v Allman (1878) 3 App Cas 709 at 720; J C Williamson Ltd v Lukey and Mulholland (1931) 45 CLR 282 at 293, 299, 307; McDermott v Black (1940) 63 CLR 161 at 187-188; Dalgety Wine Estates Pty Ltd v Rizzon (1979) 141 CLR 552 at 573; Tabcorp Holdings Ltd v Bowen Investments Pty Ltd (2009) 236 CLR 272 (2009) 236 CLR 272 at 285 [12] fn 58. 59 See, eg, J C Williamson (1931) 45 CLR 282 at 297; Trident General Insurance Co Ltd v McNiece Bros Pty Ltd (1988) 165 CLR 107 at 119, 138, 173. 60 Judicature Act 1876 (Qld), s 4; Supreme Court Act 1995 (Qld), s 244; Civil Proceedings Act 2011 (Qld), s 7. 61 See, eg, Newton, Bellamy and Wolfe [1986] 1 Qd R 431 at 445-446. GagelerJ Hence cl 24 was available to be pleaded by the respondents in answer to the appellants' reliance on ss 10 and 13 of the Limitation Act. STEWARD J. I agree substantially with the reasons of Kiefel CJ and Edelman J as well as the reasons of Gageler and Gordon JJ, and agree further that this appeal should be dismissed. However, I wish to express my own reasons for dismissing the appeal. Secured by mortgages over three plots of land, Law Partners Mortgages Pty Ltd ("LPM") lent $320,000 to the appellants in 1998. The date for repayment was ultimately fixed to be 2 July 2000, but the loan was not repaid on that date. A partial repayment was made in November 2000 which reduced the principal owing by $50,000. In August 2017, the respondents, as successors in title to LPM as mortgagee, sued the appellants for repayment of $4,014,969.22 ("the money claim") and to recover possession of the three plots of land ("the possession claim"). The appellants pleaded as a defence that the claims were statute-barred pursuant to ss 10, 13 and 26 of the Limitation of Actions Act 1974 (Qld) ("the Limitation Act"). It was not in dispute that, if it were open to the appellants to so plead, the respondents' claims were statute-barred. Two appellants further pleaded that the respondents' titles under the mortgages had been extinguished. The respondents replied that the appellants had covenanted, pursuant to cl 24 of the Bill of Mortgage ("the Mortgage"), as entered into by LPM and the appellants, that they would not plead any defence under the Limitation Act in proceedings to enforce the respondents' rights as mortgagees. The primary judge (Dalton J), for the purposes of dealing with applications for summary judgment made by both the appellants and the respondents, held that cl 24, correctly construed, could not aid the respondents in respect of the money claim or the possession claim, and that, in respect of the possession claim, s 24 of the Limitation Act had extinguished the respondents' title to the three plots of land62. The Court of Appeal of the Supreme Court of Queensland (Sofronoff P, Gotterson and Morrison JJA) disagreed63. On appeal to this Court, the appellants identified the following three issues for determination: (a) What is the correct construction of cl 24 of the Mortgage? If, correctly construed, cl 24 prevented the appellants from relying upon the defences available to them under the Limitation Act, is that clause contrary to public policy and thus void or unenforceable? In any event, should the respondents' proper remedy be confined to damages for breach of contract, and if so, should the respondents be precluded from pursuing any such claim? 62 Spoor v Price [2019] QSC 53 at [54]-[56]. 63 Spoor v Price (2019) 3 QR 176. A further and related issue also arises concerning the application of s 24 of the Limitation Act. For the reasons set out below, the Queensland Court of Appeal was correct. The correct construction of cl 24 Clause 24 of the Mortgage should be set out in full. It provides: "RESTRICTIVE LEGISLATION The Mortgagor covenants with the Mortgage[e] that the provisions of all statutes now or hereafter in force whereby or in consequence whereof any o[r] all of the powers rights and remedies of the Mortgagee and the obligations of the Mortgagor hereunder may be curtailed, suspended, postponed, defeated or extinguished shall not apply hereto and are expressly excluded insofar as this can lawfully be done." This clause has obvious shortcomings. Nonetheless, in the Queensland Court of Appeal, Gotterson JA, with whose reasons Sofronoff P and Morrison JA agreed, was of the view that the primary judge had correctly concluded that the words "suspended", "postponed" and "extinguished" in cl 24 were "inapt" to describe the effect of invoking a defence that a claim had been statute-barred by the Limitation Act64. However, his Honour was also of the view that the word "defeated" in that clause did sufficiently describe that effect65. This was consistent with the use of the word "defeat" by Australian courts, including this Court, to describe the consequence of a plea that a claim was statute-barred66. The appellants made four points. First, they submitted that "strong words" are necessary to contract out of a benefit conferred by a statute67. Here, the 64 Spoor v Price (2019) 3 QR 176 at 191 [57]. 65 Spoor v Price (2019) 3 QR 176 at 193 [66]. 66 Spoor v Price (2019) 3 QR 176 at 192 [63]-[65], quoting The Commonwealth v Verwayen (1990) 170 CLR 394 at 426 per Brennan J, 504 per McHugh J and Belgravia Nominees Pty Ltd v Lowe Pty Ltd (2017) 51 WAR 341 at 354 [46(f)] per Martin CJ, Murphy and Mitchell JJA. 67 Equitable Life Assurance of the United States v Bogie (1905) 3 CLR 878 at 911 per language deployed by cl 24 was said to be too vague68; the Limitation Act is not expressly named in it, nor is that Act identified by reference to some specified "class" of enactments. Rather, the clause seeks to defeat in relevant circumstances "the provisions of all statutes". Such generalised language should not be used, it was said, to defeat the defences available to the appellants under the Limitation Act, especially when the "onus" was on the respondents to show that the clause was efficacious. Secondly, it was contended that the language of cl 24 is not promissory at all, but merely recites a state of affairs. It was contended that cl 24, by its terms, did not oblige the appellants not to plead available defences under the Limitation Act. Thirdly, it was submitted that because cl 24 is ambiguous, that ambiguity should be resolved against the respondents in accordance with the principle verba chartarum fortius accipiuntur contra proferentem69. This was the view of the primary judge, who applied that doctrine in favour of the appellants70. Finally, the appellants submitted that it was not the Limitation Act "whereby or in consequence whereof", to use the language of cl 24, the respondents' claims were defeated. Rather, it was the act of the appellants in pleading the limitation defence that barred the respondents' claims. Clause 24, it was said, is directed only to the defeating of rights by provisions of statutes, and not by the exercise of rights conferred by them. Three propositions are applicable. First, it was never suggested that the Mortgage was anything other than the product of free negotiation between parties contracting at arm's length71. Clause 24 was part of that bargain. Its inclusion may possibly have affected decisions concerning whether to advance monies to the appellants, or what interest rate should be set. Secondly, notwithstanding arguable deficiencies in a contract, a court must strive to give meaning and effect to all of its clauses72. Here, it is more than possible to do so with respect to cl 24. Thirdly, because the Mortgage is a commercial contract, the meaning of its terms is to be determined objectively by what a reasonable business person would have 68 cf In re Clarke; Coombe v Carter (1887) 36 Ch D 348 at 355 per Bowen LJ. 69 Western Australian Bank v Royal Insurance Co (1908) 5 CLR 533 at 554 per 70 Spoor v Price [2019] QSC 53 at [51]-[54]. 71 Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640 at 660 [44] per French CJ, Hayne, Crennan and Kiefel JJ. 72 Metropolitan Gas Co v Federated Gas Employees' Industrial Union (1925) 35 CLR 449 at 455 per Isaacs and Rich JJ; Chapmans Ltd v Australian Stock Exchange Ltd (1996) 67 FCR 402 at 411 per Lockhart and Hill JJ. understood them to mean73. This requires the court to consider the language used by the parties, the circumstances known to them and the commercial purpose or objects which the contract was intended to secure74. Turning to the language of cl 24, the phrase "provisions of all statutes" plainly includes the Limitation Act. Then there are the words "powers rights and remedies". There is no reason to doubt that these words encompass the respondents' right to possession of the three plots of land. As Gotterson JA observed, the word "defeated" invites consideration, in a given case, as to what is to happen, or has happened, to those "powers rights and remedies" of a mortgagee. Where they have, by statute, been denied, they have in such a case been "defeated". As Gotterson JA said75: "It is the past participle 'defeated' in the passive voice that is used in cl 24 to describe the requisite result, namely, that the power, right or remedy may be defeated. In that way, the clause accommodates conduct by the mortgagor to trigger the operation of the statutory provision with the result that the mortgagee's power, right or remedy might be defeated. As well, the 73 Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640 at 656 [35] per French CJ, Hayne, Crennan and Kiefel JJ, citing McCann v Switzerland Insurance Australia Ltd (2000) 203 CLR 579 at 589 [22] per Gleeson CJ, Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451 at 462 [22] per Gleeson CJ, Gummow, Hayne, Callinan and Heydon JJ and International Air Transport Association v Ansett Australia Holdings Ltd (2008) 234 CLR 151 at 160 [8] per Gleeson CJ. See further Maggbury Pty Ltd v Hafele Australia Pty Ltd (2001) 210 CLR 181 at 188 [11] per Gleeson CJ, Gummow and Hayne JJ, citing Investors Compensation Scheme Ltd v West Bromwich Building Society [1998] 1 WLR 896 at 912 per Lord Hoffmann (Lords Goff, Hope and Clyde agreeing); [1998] 1 All ER 98 at 114. See also Homburg Houtimport BV v Agrosin Private Ltd [2004] 1 AC 715 at 737 [10] per Lord Bingham. 74 Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640 at 656-657 [35] per French CJ, Hayne, Crennan and Kiefel JJ, citing Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451 at 461-462 [22] per Gleeson CJ, Gummow, Hayne, Callinan and Heydon JJ, Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165 at 179 [40] per Gleeson CJ, Gummow, Hayne, Callinan and Heydon JJ, International Air Transport Association v Ansett Australia Holdings Ltd (2008) 234 CLR 151 at 160 [8] per Gleeson CJ, 174 [53] per Gummow, Hayne, Heydon, Crennan and Kiefel JJ and Byrnes v Kendle (2011) 243 CLR 253 at 284 [98] per Heydon and Crennan JJ. See also Charter Reinsurance Co Ltd v Fagan [1997] AC 313 at 326, 350; Rainy Sky SA v Kookmin Bank [2011] 1 WLR 2900 at 2906-2907 [14]; [2012] 1 All ER 1137 at 1144. 75 Spoor v Price (2019) 3 QR 176 at 192 [62]. words 'may be', rather than the word 'is', are used to describe the result. Those words have a flexibility that comprehends a decision on the part of the mortgagor whether or not to plead a statutory provision in order for the mortgagee's power, right or remedy to be defeated by operation of the provision." Further, it is also pursuant to the provisions of the Limitation Act "whereby or in consequence whereof" the appellants may plead that a claim has been defeated. The phrase "shall not apply hereto and are expressly excluded" aptly expresses the appellants' promise, to the extent they can perform it, not to invoke various statutory protections or defences available to the appellants, including defences under the Limitation Act. Finally, the phrase "insofar as this can lawfully be done" at the end of cl 24 probably adds little to the content of the appellants' covenant, but it does highlight that not every statute adversely affecting the respondents' "powers rights and remedies" could lawfully be excluded by the Mortgage. Turning to the appellants' contentions, whatever might be meant by their submission that "strong words" are needed to contract out of a private benefit conferred by a statute, by reason of the foregoing, the language in cl 24 is sufficient to achieve that legal effect in relation to the defences that might be invoked under the Limitation Act. Contrary to the appellants' submission, cl 24 contains language which is promissory in nature. It states that the mortgagor "covenants" with the mortgagee that statutes which have certain effects on the powers, rights and remedies of the mortgagee "shall not apply ... and are expressly excluded". Although the language is clumsy, it should not be read as some declaration concerning the legal reach of Acts of Parliament. Rather, the Mortgage should be construed "so as to avoid it 'making commercial nonsense ...'"76. Accordingly, these words should be read as a reference to a promise not to invoke a benefit conferred by statute which permits the mortgagor to defeat the powers, rights and remedies of the mortgagee. 76 Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640 at 657 [35] per French CJ, Hayne, Crennan and Kiefel JJ, quoting Zhu v Treasurer of New South Wales (2004) 218 CLR 530 at 559 [82] per Gleeson CJ, Gummow, Kirby, Callinan and Heydon JJ. See also Gollin & Co Ltd v Karenlee Nominees Pty Ltd (1983) 153 CLR 455 at 464 per Mason, Murphy, Brennan, Deane and The "seldom to be resorted to"77 principle verba chartarum fortius accipiuntur contra proferentem does not have any dispositive effect here. That principle may be applicable where there are two equally competing constructions of a given clause78. However, it cannot apply here precisely because the appellants' argument that cl 24 of the Mortgage is ineffective or not applicable should not be preferred. Applying the ordinary rules of construction has resulted in cl 24 having a certain meaning that a court must enforce. There are no equally persuasive interpretations of cl 24. In any event, as Sir George Jessel MR observed in 1877, the "now established rules of construction" have rendered the principle as having no force "at the present day"79. His Lordship then said80: "The rule is to find out the meaning of the instrument according to the ordinary and proper rules of construction. If we can thus find out its meaning, we do not want the maxim. If, on the other hand, we cannot find out its meaning, then the instrument is void for uncertainty". In that respect, and contrary to the submissions of the appellants, there was no onus on the respondents to establish that their construction of cl 24 is correct. The issue of construction is a question of law81, to be objectively determined having regard to the text and context of the contract, and the commercial purpose or objects which it was intended to secure82. Finally, the cause of the potential defeat of the respondents' claims should not be characterised narrowly as the appellants' act of pleading a limitation defence. The ordinary and natural meaning of the phrase "whereby or in consequence whereof" in cl 24 of the Mortgage sufficiently embraces both the direct application of a statute, and its indirect effect, in defeating the rights of the 77 Western Australian Bank v Royal Insurance Co (1908) 5 CLR 533 at 554 per 78 University of Wales v London College of Business Ltd [2015] EWHC 1280 (QB) at [105] per Judge Keyser QC, quoting Whitecap Leisure Ltd v John H Rundle Ltd [2008] 2 Lloyd's Rep 216 at 223 [20] per Moore-Bick LJ. 79 Taylor v Corporation of St Helens (1877) 6 Ch D 264 at 270-271. 80 Taylor v Corporation of St Helens (1877) 6 Ch D 264 at 271. 81 Deane v City Bank of Sydney (1904) 2 CLR 198 at 209 per Griffith CJ, Barton and 82 Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104 at 116 [46]-[47] per French CJ, Nettle and Gordon JJ. respondents. Here, the appellants' plea of limitation could only have been effective because of the provisions of the Limitation Act. Clause 24 and public policy The appellants contended that a person cannot contract out of the defences conferred by the Limitation Act. They put their case in two ways. First, they submitted that it was Parliament's intention that a person should not have this freedom, and that this was discernible from the text, applicable context, and the purpose and scheme of the Limitation Act. Secondly, they submitted that a clause which purports to oust the defences available under the Limitation Act is, in any event, contrary to the public policy of the common law. Relevant provisions Section 10 of the Limitation Act relevantly provides: "Actions of contract and tort and certain other actions The following actions shall not be brought after the expiration of 6 years from the date on which the cause of action arose – ... an action founded on simple contract ..." Section 13 provides: "Actions to recover land An action shall not be brought by a person to recover land after the expiration of 12 years from the date on which the right of action accrued to the person or, if it first accrued to some person through whom the person claims, to that person." Section 24(1) relevantly provides: "Extinction of title after expiration of period of limitation ... where the period of limitation prescribed by this Act within which a person may bring an action to recover land (including a redemption action) has expired, the title of that person to the land shall be extinguished." Section 5(5) relevantly provides that "[a] reference in this Act to a right of action to recover land includes a reference to a right to enter into possession of the land". Section 26 relevantly provides: Steward "Actions to recover money secured by mortgage or charge or to recover proceeds of the sale of land (1) An action shall not be brought to recover a principal sum of money secured by a mortgage or other charge on property whether real or personal nor to recover proceeds of the sale of land after the expiration of 12 years from the date on which the right to receive the money accrued. The provisions of this section do not apply to a foreclosure action in respect of mortgaged land, but the provisions of this Act with respect to an action to recover land apply to such an action. (5) An action to recover arrears of interest payable in respect of a sum of money secured by a mortgage or other charge or payable in respect of proceeds of the sale of land or to recover damages in respect of such arrears shall not be brought after the expiration of 6 years from the date on which the interest became due." To the extent of any overlap between the limitation periods in ss 10 and 13, no party disputed that it was open to the appellants to plead and rely upon the shorter period set out in s 1083. As it happens, the respondents brought both the possession claim and the money claim more than 12 years after these rights of action accrued to them. The decision below Before the Queensland Court of Appeal, the appellants relied upon certain decisions of the Supreme Court of Utah84 and the Appellate Court of Connecticut85 in support of the proposition that a person cannot contract out of a Statute of Limitations86. However, the appellants did not rely upon these cases before this 83 Brisbane City Council v Amos (2019) 266 CLR 593 at 598 [4]-[5] per Kiefel CJ and Edelman J, 615 [46] per Gageler J, 615 [48] per Keane J, 617 [54]-[55] per Nettle J. 84 Hirtler v Hirtler (1977) 566 P 2d 1231. 85 Haggerty v Williams (2004) 855 A 2d 264. 86 Spoor v Price (2019) 3 QR 176 at 186 [30]-[32]. Court; they can therefore be put to one side. Notwithstanding the appellants' submissions, Gotterson JA decided that one could contract out of the defences conferred by the Limitation Act87. His Honour did so largely in reliance upon the judgments of Mason CJ and Brennan J (as his Honour then was) in The Two relevant propositions may be extracted from the reasons of Mason CJ in Verwayen. The first is not in dispute. Whether or not a person can waive the defences conferred by a particular Statute of Limitations depends on the scope and policy of that Act; the test is whether the applicable provisions are "dictated by public policy" and were enacted "not for the benefit of any individuals or body of individuals, but for considerations of State"89. If so, they cannot be excluded by contract. But if the benefit conferred by statute is otherwise private in nature, the law may permit the parties to exclude it. As Mason CJ said, "the critical question is whether the benefit is personal or private or whether it rests upon public policy or expediency"90. Gotterson JA also referred91 to the more recent expression of that principle in Westfield Management Ltd v AMP Capital Property Nominees Ltd, where French CJ, Crennan, Kiefel and Bell JJ said92: "Windeyer J observed in Brooks v Burns Philp Trustee Co Ltd93 that a person upon whom a statute confers a right may waive or renounce his or her rights unless it would be contrary to the statute to do so. It will be contrary to the statute where the statute contains an express prohibition against 'contracting out' of rights. In addition, the provisions of a statute, read as a whole, might be inconsistent with a power, on the part of a person, to forego statutory rights. It is the policy of the law that contractual 87 Spoor v Price (2019) 3 QR 176 at 189 [43]. 88 Spoor v Price (2019) 3 QR 176 at 187-188 [35]-[36], [38]-[39], quoting The Commonwealth v Verwayen (1990) 170 CLR 394 at 404-406 per Mason CJ, 426 per 89 The Commonwealth v Verwayen (1990) 170 CLR 394 at 405, citing Admiralty Commissioners v Valverda (Owners) [1938] AC 173 at 185 per Lord Wright. 90 The Commonwealth v Verwayen (1990) 170 CLR 394 at 405, citing Brown v The Queen (1986) 160 CLR 171 at 208 per Dawson J. 91 Spoor v Price (2019) 3 QR 176 at 188 [36]. (2012) 247 CLR 129 at 143-144 [46]. (1969) 121 CLR 432 at 456. arrangements will not be enforced where they operate to defeat or circumvent a statutory purpose or policy according to which statutory rights are conferred in the public interest, rather than for the benefit of an individual alone. The courts will treat such arrangements as ineffective or void, even in the absence of a breach of a norm of conduct or other requirement expressed or necessarily implicit in the statutory text94." Here, before both the Queensland Court of Appeal and this Court, the appellants contended that the defences conferred by the Limitation Act existed not for the personal benefit of individuals but in the pursuit of the public policy of finality in litigation. The second proposition is that Parliaments have chosen to implement the public policy of finality in litigation by conferring on defendants a right to plead an applicable Statute of Limitations defence, rather than by imposing a restriction on jurisdiction95. In that respect, no party disputed that it had been long established that the language used in the Limitation Act – an action "shall not be brought" – was a reference to a defendant having the capacity to plead a defence of limitation and not to the extinguishment of any underlying rights of a plaintiff96. On that basis, Mason CJ in Verwayen concluded, for the purpose of considering whether the defences conferred by a Statute of Limitations97 may be waived, as follows98: "I conclude that the purpose of the statute is to confer a benefit upon persons as individuals rather than to meet some public need which must be satisfied to the exclusion of the right of access of individuals to the courts. On that 94 Caltex Oil (Australia) Pty Ltd v Best (1990) 170 CLR 516 at 522 per Mason CJ, Gaudron and McHugh JJ (Dawson J agreeing); Fitzgerald v F J Leonhardt Pty Ltd (1997) 189 CLR 215 at 227 per McHugh and Gummow JJ; International Air Transport Association v Ansett Australia Holdings Ltd (2008) 234 CLR 151 at 179 [71] per Gummow, Hayne, Heydon, Crennan and Kiefel JJ; Miller v Miller (2011) 242 CLR 446 at 457-458 [25] per French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ; Equuscorp Pty Ltd v Haxton (2012) 246 CLR 498 at 513 [23] per French CJ, Crennan and Kiefel JJ. 95 The Commonwealth v Verwayen (1990) 170 CLR 394 at 405 per Mason CJ. 96 Brisbane City Council v Amos (2019) 266 CLR 593 at 599 [7] per Kiefel CJ and 97 The Court in Verwayen was concerned with the Limitation of Actions Act 1958 (Vic). 98 The Commonwealth v Verwayen (1990) 170 CLR 394 at 405-406. basis, it is possible to 'contract out' of the statutory provisions, and it is equally possible to deprive them of effect by other means such as waiver. Put differently, the provisions are procedural rather than substantive in nature, which suggests that they are capable of waiver". Brennan J reached the same conclusion. His Honour was of the view that, as the defences conferred by the Limitation of Actions Act 1958 (Vic) were introduced "solely" for the benefit of a defendant, who must plead the applicable defence for it to be effective, the defence was capable of being waived99. Based on these authorities, Gotterson JA concluded that100: the Limitation Act did not expressly provide that a person could not contract out of pleading the defences conferred by that Act, a point undisputed by the parties before this Court; and no such limitation or restriction could be implied from the terms of the Limitation Act. His Honour inferred that Parliament intended for a defendant to have both an ability to plead a limitation defence and the capacity to give up that ability. Submissions before this Court The appellants relied upon two contentions to advance a contrary conclusion. The first was that a statutorily conferred advantage can only be excluded by contract if it operates solely for the benefit of a person101, whereas, if the benefit serves a mix of public and private interests, it cannot be excluded by contract102. An individual, it was said, could thus not waive a matter "in which the public have an interest"103. The second was that the "freedom and sanctity of contract" are not conclusive of the public interest and should not here trump the 99 The Commonwealth v Verwayen (1990) 170 CLR 394 at 426. 100 Spoor v Price (2019) 3 QR 176 at 188-189 [40]. 101 Citing Equitable Life Assurance of the United States v Bogie (1905) 3 CLR 878 at 893 per Griffith CJ, 897 per Barton J. 102 Citing Johnson v Moreton [1980] AC 37 at 58 per Lord Hailsham. 103 Citing Graham v Ingleby (1848) 1 Exch 651 at 657 per Alderson B [154 ER 277 at public policy of finality in litigation; the law, it was said, began to "back-pedal" from freedom of contract in the nineteenth century104. Public benefit For the first proposition, the appellants relied upon the reasons of McHugh J in Brisbane South Regional Health Authority v Taylor, where his Honour identified the following four "broad rationales" for the enactment of limitation periods in civil litigation105: "First, as time goes by, relevant evidence is likely to be lost106. Second, it is oppressive, even 'cruel', to a defendant to allow an action to be brought long after the circumstances which gave rise to it have passed107. Third, people should be able to arrange their affairs and utilise their resources on the basis that claims can no longer be made against them108 ... The final rationale for limitation periods is that the public interest requires that disputes be settled as quickly as possible109." The final rationale was said to express a public benefit which could not be contracted out of as a matter of public policy, having regard to the text, purpose and object of the Limitation Act. In that respect, the appellants submitted that the Queensland Parliament had manifestly turned its mind to consider when the limitation periods should not apply by the enactment of a regime for obtaining extensions of time: Pt 3 of the Limitation Act. It followed that if Parliament had intended to permit someone to exclude by contract the benefits conferred by that Act, it would have done so expressly. An example of this may be found in s 45 of the Limitation Act 2005 (WA), which relevantly provides that "[n]othing in this Act prevents a person from agreeing to extend or shorten a limitation period 104 Citing Johnson v Moreton [1980] AC 37 at 66 per Lord Simon. 105 (1996) 186 CLR 541 at 552-553. 106 Jones v Bellgrove Properties Ltd [1949] 2 KB 700 at 704 per Lord Goddard CJ. 107 R B Policies at Lloyd's v Butler [1950] 1 KB 76 at 81-82 per Streatfeild J. 108 New South Wales Law Reform Commission, Limitation of Actions for Personal Injury Claims, LRC 50 (1986) at 3; Law Reform Commission of Western Australia, Discussion Paper on Limitation and Notice of Actions, Project No 36 Part II (1992) 109 New South Wales Law Reform Commission, Limitation of Actions for Personal Injury Claims, LRC 50 (1986) at 3; Law Reform Commission of Western Australia, Discussion Paper on Limitation and Notice of Actions, Project No 36 Part II (1992) provided for under this Act". The existence of Pt 3 of the Limitation Act also demonstrated, it was said, that the Act expresses a series of legislative choices about balancing the rights of plaintiffs and defendants. That balancing of rights was not something which the parties could themselves adjust or disturb by contract. The appellants did not, and could not, deny that a party may waive the defences conferred by the Limitation Act. However, they contended that the doctrine of waiver was separate and distinct from an asserted right to exclude by contract a benefit conferred by statute. There is, it was said, nothing inconsistent in that position. The appellants argued that the critical element that is present in the doctrine of waiver, which is not present in the doctrine of exclusion by contract, is the mental element of "knowledge". A defendant to a cause of action can waive the right to plead a limitation defence because at that point in time she or he is armed with knowledge of what is being claimed. In contrast, it was contended, a person does not have such equivalent knowledge when entering into a contract and covenanting not to rely upon the Limitation Act as a defence against any future causes of action. The proposition that a Statute of Limitations confers benefits which are intractable, and which cannot be avoided, is unsustainable. The benefit of protection from a late claim that is not made within the times prescribed by the Statute of Limitations will not arise unless a defendant pleads it as a defence110. Its application thus turns upon a choice made by a defendant in a given proceeding. That is the starting point. It is a starting point of some antiquity. A failure to plead the limitation defence has been fatal to a defendant's ability to invoke a Statute of Limitations since at least the early seventeenth century111. Consistently with this, and as the appellants properly accepted, the benefit of the defences may be waived. But the attempt to distinguish this from contracting out based on a defendant's knowledge fails. It is not supported by authority and is logically unsustainable. The degree of "knowledge" said to be needed for the doctrine of waiver was never specified and it assumed that all defendants would, upon being served with a claim, have sufficient "knowledge" to be able to waive 110 Brisbane City Council v Amos (2019) 266 CLR 593 at 616 [49] per Keane J, citing Courtenay v Williams (1844) 3 Hare 539 at 551-552 per Wigram V-C [67 ER 494 at 499-500], Dawkins v Lord Penrhyn (1878) 4 App Cas 51 at 58-59 per Earl Cairns LC, Ketteman v Hansel Properties Ltd [1987] AC 189 at 219 per Lord Griffiths and The Commonwealth v Verwayen (1990) 170 CLR 394 at 405 per Mason CJ, 473-474 per Toohey J. 111 Thursby v Warren (1628) Cro Car 159 [79 ER 738]. the benefits conferred by the Limitation Act. In reality, different defendants will have very different levels of knowledge about the claims being made against them. Accordingly, there is no principled basis for distinguishing between the waiver of a limitation defence in respect of a particular cause of action and an enforceable promise never to take a limitation defence against a counter-party to a contract. They are both legitimate ways of excluding the benefits conferred on a defendant by the Limitation Act. As Lord Diplock observed in Kammins Ballrooms Co Ltd v Zenith Investments (Torquay) Ltd, waiving a right to a limitation defence112: "means that the party has chosen not to rely upon the non-compliance of the other party with the requirement, or has disentitled himself from relying upon it either by agreeing with the other party not to do so or because he has so conducted himself that it would not be fair to allow him to rely upon non-compliance." The proposition that because the Limitation Act serves, in part, a public policy – viz finality in litigation – the effect of its provisions cannot be adjusted or disturbed by contract, is not correct. The contention ignores the legislative choice made to implement that policy, which is to confer, effectively, an option on defendants either to invoke or not to invoke the benefits of the Limitation Act. In other words, the legislature has chosen to serve the public policy through the conferral of purely private benefits. In that sense, the benefits of the Limitation Act can correctly be seen as purely private in nature113. Once it is accepted that the policy of finality in litigation is one that is statutorily entrusted to each defendant, it follows that the limitation defences may be waived. It also follows, as a matter of logic and principle, that a party may agree to promise not to invoke those defences as part of the contractual bargain. The Limitation Act neither expressly nor by implication justifies a contrary conclusion. In that respect, having accepted that limitation defences may be waived, the appellants' reliance upon the statutory power of extension in Pt 3 of the Limitation Act, as demonstrative of Parliament having expressly decided when the limitation periods should not apply, has little force. Evidently, the presence of Pt 3, on the appellants' own case, did not deny a person's ability to waive reliance upon a limitation defence. 112 [1971] AC 850 at 881 (emphasis added). 113 cf Graham v Ingelby (1848) 1 Exch 651 at 655 per Pollock CB [154 ER 277 at 278- 279], quoted in Kammins Ballrooms Co Ltd v Zenith Investments (Torquay) Ltd [1971] AC 850 at 876-877 per Lord Pearson. As it happens, the law has long recognised an ability to exclude limitation defences by contract. In Lade v Trill114, Messrs Lade and Trill, a farmer and a bricklayer who were related and lived in the same area, frequently accommodated each other with money, for which promissory notes were given. They both died in 1835. The executors of their estates entered into a verbal agreement in 1837 that the old accounts of Messrs Lade and Trill were to be settled on a given day without regard to the length of time that had been running. Settlement then took place. Some time later, the executors of Mr Trill's estate discovered a promissory note that had been given by Mr Lade to Mr Trill for 250 pounds. They sought to enforce it. Knight Bruce V-C decided that neither party was to be at liberty to take advantage of the Statute of Limitations. That was because there had been an agreement for valuable consideration for both sides to waive the benefit of that statute, and this agreement "ought to be enforced"115. In Wright v John Bagnall & Sons Ltd116, a defendant admitted liability under the Workmen's Compensation Act 1897 (UK) in relation to a workplace accident. Under that Act, a person was required to make any claim for compensation within six months of an accident occurring. The parties reserved their respective rights to go to court to determine the quantum of damages. Whilst the parties were still negotiating, the six-month time limit ran out. Vaughan Williams LJ decided that there was an agreement that the defendant was liable to pay compensation and that if the parties could not agree as to the amount, they were then to obtain an adjudication of that issue from a court117. The defendant nonetheless raised the lapse of time as a defence. Because of that agreement, Vaughan Williams LJ said, this defence could not "be set up as a bar to the claim"118. Collins LJ similarly stated that the defendant was "debarred from raising the point that the statutory limitation applied"119 because of the agreement. Romer LJ also agreed120. 114 (1842) 11 LJ Ch 102. 115 Lade v Trill (1842) 11 LJ Ch 102 at 103. 117 Wright v John Bagnall & Sons Ltd [1900] 2 QB 240 at 244-245. 118 Wright v John Bagnall & Sons Ltd [1900] 2 QB 240 at 245. 119 Wright v John Bagnall & Sons Ltd [1900] 2 QB 240 at 244. 120 Wright v John Bagnall & Sons Ltd [1900] 2 QB 240 at 245. The later decision of Lubovsky v Snelling121 concerned similar circumstances. During an interview between the plaintiff and the defendant's insurance company, liability under the Fatal Accidents Act 1846 (UK) was admitted on the basis that the quantum of damages was to be fixed by a judge. Under s 3 of that Act, proceedings were required to be commenced within 12 months of death. A writ was issued after that time period had expired. The defendant pleaded s 3 of the Act. Scott LJ, with whom Mackinnon and Goddard LJJ agreed122, was of the view that the parties had entered into a contract whereby liability was admitted and the defendant was precluded from putting forward any limitation defence. As his Lordship observed, "[i]t was just as much a contract not to plead s 3 of the Act"123. It followed that the "plea was not so open"124. Goddard LJ added that he could "see no distinction between this case and that of [Wright], which is binding on this court"125. The appellants submitted that Lade v Trill is an historical anomaly and should not be followed. Whilst the reasons of Knight Bruce V-C are scant, the Court was not taken to any contrary authority, and the appellants' contention ultimately rose no higher than an assertion that the case was wrongly decided. The appellants also submitted that this Court should distinguish Wright and Lubovsky (as well as Kammins) on the basis that the time period in each case was annexed to the right created by the relevant statute. As Windeyer J explained in Australian Iron & Steel Ltd v Hoogland126, such provisions may differ from a Statute of Limitations because they constitute an essential statutory condition for obtaining relief to be pleaded by a plaintiff, as distinct from a defence to be pleaded by a defendant. The appellants also submitted that Australia has not adopted the more liberal approach to limitation periods annexed to statutory rights found in the English cases. These submissions are not persuasive. As to the first reason, a principle that a court may enforce a contract which permits the positive exclusion of a statutory condition for the obtaining of relief does not deny, as a matter of logic, the arguably more modest proposition that a contract which excludes the defences arising under a Statute of Limitations may also be enforceable. As to the 122 Lubovsky v Snelling [1944] KB 44 at 46-48. 123 Lubovsky v Snelling [1944] KB 44 at 46. 124 Lubovsky v Snelling [1944] KB 44 at 46. 125 Lubovsky v Snelling [1944] KB 44 at 47. 126 (1962) 108 CLR 471 at 488. second reason, it was not supported by relevant authority; the case cited by the appellants for this proposition, The Crown v McNeil127, did not concern an agreement that was held to have the effect of preventing a defendant from setting up a limitation defence. Rather, the issue in that case was whether certain fraudulent conduct could have had the effect of extending the time prescribed for suing the Crown pursuant to the Crown Suits Act 1898 (WA). The Court was then also asked not to follow Kammins, Wright and Lubovsky. In support of that proposition, the appellants cited an observation by Lord Evershed MR in The "Sauria" and the "Trent", where his Lordship expressed his "greatest difficulty" with Lubovsky "[a]s a matter of principle"128. However, in that case no contract to exclude the relevant limitation period was found to exist. Moreover, Lord Evershed MR did not fully explain the basis for his difficulty, although it may have been a concern about the breadth of the exclusion in Lubovsky. The foregoing authorities are illustrative of the common law's general tolerance of bargains which seek to exclude private benefits conferred by statute. Contrary to the submissions of the appellants, these authorities cannot be read as instances of estoppel or waiver. In each case, an agreement to exclude a statutory limitation period was found to be legally efficacious. Freedom of contract More significantly, the conclusions reached in the foregoing cases are consistent with the broad principle of freedom of contract. Courts may have, to an extent, "back-pedalled" from Sir George Jessel MR's classic expression of this principle in 1875129, but it remains an important attribute of the law. In Ringrow Pty Ltd v BP Australia Pty Ltd, this Court observed130: 127 (1922) 31 CLR 76. 128 [1957] 1 Lloyd's Rep 396 at 400. 129 Printing and Numerical Registering Company v Sampson (1875) LR 19 Eq 462 at 130 (2005) 224 CLR 656 at 669 [32] per Gleeson CJ, Gummow, Kirby, Hayne, Callinan and Heydon JJ, cited and approved in Paciocco v Australia & New Zealand Banking Group Ltd (2016) 258 CLR 525 at 553 [54] per Kiefel J, 578 [156] per Gageler J, 604 [250] per Keane J. "Exceptions from that freedom of contract require good reason to attract judicial intervention to set aside the bargains upon which parties of full capacity have agreed." In Sidhu v British Airways Plc, Lord Hope (with whom Lords Browne- Wilkinson, Jauncey, Mustill and Steyn agreed) said131: "Any person is free, unless restrained by statute, to enter into a contract with another on the basis that his liability in damages is excluded or limited if he is in breach of contract. Exclusion and limitation clauses are a common feature of commercial contracts". It was open to the parties here to exercise their freedom of contract by the inclusion of cl 24. That clause represents a legitimate adjustment of the private statutory rights of the appellants, which they were free to include, amongst other clauses, in their original bargain with LPM in order to secure a loan of monies to them. The common law Alternatively, the appellants submitted that the common law recognises a public policy, independent of the Limitation Act, of finality in litigation. The community, it was submitted, had tacitly adopted it. It was said to be reflected in, for example, the decision of this Court in Aon Risk Services Australia Ltd v Australian National University and the concern there expressed about delay132. Clause 24 offended this policy and was accordingly void. The merits of this contention may be addressed briefly. It emerged from the submissions as no more than an assertion unsupported by direct authority. Moreover, given that the common law did not itself impose any limitations on the time within which to commence a suit133, it is difficult to see why the common law should now recognise the public policy asserted by the appellants. The contention is rejected. Breach of contract The appellants finally submitted that if cl 24 operates to prevent them from relying upon s 13 of the Limitation Act, the respondents should nonetheless be 131 [1997] AC 430 at 453. 132 (2009) 239 CLR 175 at 212 [95] per Gummow, Hayne, Crennan, Kiefel and Bell JJ. 133 Blackmore v Tidderley (1704) 2 Ld Raym 1099 at 1100 per Holt CJ [92 ER 228 at 228]; Williams v Jones (1811) 13 East 439 at 449 per Lord Ellenborough CJ [104 ER 441 at 445]. denied the remedy of possession because they should have sued the appellants for damages for breach of contract. The appellants further submitted that this Court should not remit the matter back to the Supreme Court of Queensland to permit the respondents to pursue such a claim, as they had made an election not to sue on this basis, or they are otherwise now estopped from doing so134. The appellants relied upon an 1849 advice of the Privy Council on appeal from the Supreme Court of Judicature at Fort William in Bengal: The East India Company v Oditchurn Paul135. In 1822, the respondent purchased salt, located in a warehouse, from the British East India Company (which at the time held a monopoly over salt in the former British India). Until 1831, the respondent received from time to time deliveries of salt from that warehouse. But in 1831, an inundation took place which destroyed all of the respondent's remaining salt. The respondent sought a refund of part of the purchase money. This was refused. The East India Company then convened an inquiry into the matter. A negative report was furnished in 1838, and the Company again refused to refund the respondent. The respondent then sued in assumpsit for recovery of an amount of purchase money corresponding to the salt that had not been delivered. However, the claim was found to be statute-barred; the fact of the inquiry did not suspend time for the purposes of the Limitations Act 1623 (21 Jac 1 c 16)136. Lord Campbell, delivering the reasons of the Judicial Committee137, said138: "There might be an agreement that in consideration of an inquiry into the merits of a disputed claim, advantage should not be taken of the Statute of Limitations in respect of the time employed in the inquiry, and an action might be brought for breach of such an agreement; but if to an action for the original cause of action the Statute of Limitations is pleaded, upon which issue is joined – proof being given that the action did clearly accrue 134 Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589 at 602-603 per Gibbs CJ, Mason and Aickin JJ. 135 (1849) 7 Moo PC 85 [13 ER 811]. 136 The East India Company v Oditchurn Paul (1849) 7 Moo PC 85 at 111-112 [13 ER 137 Comprised of Lords Langdale and Campbell, the Rt Hon Dr Lushington and the Rt Hon T Pemberton Leigh. 138 The East India Company v Oditchurn Paul (1849) 7 Moo PC 85 at 112 [13 ER 811 more than six years before the commencement of the suit – the Defendant, notwithstanding any agreement to inquire, is entitled to the verdict." The appellants relied upon the foregoing passage for the proposition that the respondents' remedy should be confined to damages for breach of cl 24. In that respect, they conceded that it was possible for parties to suspend by contract the Limitation Act for a specified or limited period, but contended that it was not possible to contract out of that Act entirely. This principle, it was said, explained why it might have been lawful for the parties in Oditchurn Paul to have suspended the operation of the Statute of Limitations pending the inquiry undertaken into the inundation of the salt. Oditchurn Paul is not authority for the proposition advanced by the appellants. The existence of one remedy does not necessarily foreclose the possibility of other remedies. For example, in Newton, Bellamy and Wolfe v State Government Insurance Office (Qld)139, a claim for damages was made arising out of a motor vehicle collision. In previous correspondence, the State Government Insurance Office had conceded liability. It subsequently claimed in its defence that the proceeding was statute-barred. The Full Court of the Supreme Court of Queensland decided that there had been an agreement that liability would not be an issue for determination and that, consequently, the insurer could not rely on this defence140. McPherson J recognised that the plaintiffs had an "option of suing for damages for breach of that contract, or of affirming the contract and relying upon it in answer to the defence"141. That observation was correct. Here, the respondents chose to rely upon cl 24142 in reply to the appellants' invocation of the Limitation Act in their defence. They were entitled to respond to that pleading by contending in their reply, as was apparently the case in Wright and Lubovsky, that the appellants were debarred from raising a defence under the Limitation Act143. There is no reason to doubt the legitimacy and effectiveness of 139 [1986] 1 Qd R 431. 140 Newton, Bellamy and Wolfe v State Government Insurance Office (Qld) [1986] 1 Qd R 431 at 437 per Andrews A-CJ and Derrington J, 443-445 per McPherson J. 141 Newton, Bellamy and Wolfe v State Government Insurance Office (Qld) [1986] 1 Qd R 431 at 445-446. 142 The respondents' plea was ostensibly based on an estoppel arising from cl 24. However, as noted by the primary judge, the case below was conducted on the basis that the respondents relied upon that clause as effecting a contracting out of the Limitation Act: Spoor v Price [2019] QSC 53 at [20]-[21]. 143 See Bosanquet and Marchant, A Practical Treatise on the Statutes of Limitations in England and Ireland, 2nd ed (1893) at 94-95. such a reply. Given that it has been long established that the benefit of a Statute of Limitations is invoked by pleading it as a defence, it makes perfect sense for the validity of such an invocation to be raised in a reply to that defence. The respondents' reply here sufficiently put the appellants on notice that their answer to the appellants' reliance upon the Limitation Act would be cl 24 of the Mortgage. The issue of the validity of this defence was thus then engaged. The submission that a distinction can be drawn between a clause limiting the application of the benefits conferred by the Limitation Act for a limited period only, and a clause like cl 24, should be rejected. If anything, this proposition, like the appellants' concession about waiver, fundamentally undermines their case. The distinction is not sustainable as a matter of principle. Because the respondents are not confined here to a claim for damages for breach of cl 24, it is unnecessary to consider whether they had made an election not to sue on that basis or whether they should otherwise be estopped from pursuing such a claim. Section 24 of the Limitation Act In this matter, the respondents, amongst other remedies, seek possession of the three plots of land. They do not seek foreclosure. As noted earlier, s 5(5) of the Limitation Act relevantly provides that "[a] reference in this Act to a right of action to recover land includes a reference to a right to enter into possession of the land". It follows that in relation to the possession claim, ss 13 and 24 of the Limitation Act, which address actions for the recovery of land, apply. The appellants did not contend that s 24 had any independent operation from s 13 of the Limitation Act. They appeared to accept that s 24 only applied to extinguish the respondents' title as mortgagees to the three plots of land if the respondents' claims were otherwise statute-barred. Gotterson JA was of the same view. His Honour found that s 24 did not apply in the circumstances of this case144. That was because "the limitation period prescribed by the Act" for the purposes of s 24 was to be found in s 13, which in turn prescribed a 12-year limit within which to bring an action to recover land145. However, by reason of cl 24 of the Mortgage, "as between mortgagor and mortgagee, the period of limitation prescribed by s 13 has never applied and hence 144 Spoor v Price (2019) 3 QR 176 at 193-194 [74]-[76]. 145 Spoor v Price (2019) 3 QR 176 at 194 [75]. has never expired"146. The appellants did not challenge the correctness of this reasoning beyond their objection on public policy grounds. Nonetheless, the possibility that s 24 has independent operation should be addressed. In that respect, it appears to have been accepted that s 24 is a substantive provision because it does more than bar a remedy; it extinguishes the title of a person to the land. It also appears to have been accepted that a party cannot exclude its application by contract because it serves a public need. The issue is whether, in such circumstances, s 24 automatically applies to extinguish title 12 years after the accrual of a cause of action to recover land. In other words, does the phrase in s 24 "the period of limitation prescribed by this Act within which a person may bring an action to recover land" relevantly refer to the 12 years prescribed by s 13, regardless of whether a party has invoked the Limitation Act as a defence? For the reasons given below, it does not. The genesis of s 24 is to be found in s 34 of the Real Property Limitation Act 1833 (UK) and in the doctrine of adverse possession. As Mr Strauss QC, sitting as a deputy High Court judge in England, observed in Beaulane Properties Ltd v Palmer, this enactment constituted "a radical change in the law"147. The change was described by Mr Strauss QC in the following way148: "Before [1833], lapse of time barred the owner's remedies, but did not transfer title. By section 34 of the Real Property Limitation Act 1833 (3 & 4 Will 4, c 27) the owner's rights were extinguished and the trespasser acquired title to the land. The reason for the change in the law, and other later changes, was that it was for the public good. It did away with burdensome enquiries and difficulties which were encountered in conveyancing transactions generally (not only those in which there was an issue about a possible possessory title), and made conveyancing less expensive." By s 5 of the Distress Replevin and Ejectment Act 1867 (Qld), an almost identical version of s 34 of the Real Property Limitation Act 1833 (UK) became law in Queensland. In contrast, actions relating to personal property, and not land, were the subject of the Statute of Frauds and Limitations 1867 (Qld). Section 5 of the Distress Replevin and Ejectment Act 1867 (Qld) was essentially re-enacted in 1960 as s 22 of the Limitation Act 1960 (Qld). Much of that Act was modelled on 146 Spoor v Price (2019) 3 QR 176 at 194 [76]. 147 [2006] Ch 79 at 102 [69(a)]. 148 Beaulane Properties Ltd v Palmer [2006] Ch 79 at 102 [69(a)-(b)]. the Limitation Act 1939 (UK), which, amongst other things, effectively merged the Acts dealing with limitations on actions relating respectively to real and personal property. Section 22 was then relevantly re-enacted in 1974 to become s 24 of the Limitation Act. In Beaulane Properties, Mr Strauss QC also observed that under the Torrens system, it was initially not possible to acquire rights over registered land by adverse possession149. That was the position in Queensland until 1952150. Following that change, it may be accepted that s 24, together with Pt 6 Div 5 of the Land Title Act 1994 (Qld)151, is the legal means whereby the adverse possessor may obtain registered title to land in Queensland. It is important to identify precisely what s 24 extinguishes. In Fairweather v St Marylebone Property Co Ltd152, the land in question had been subject to a lease; part of the appellant's shed, from the neighbouring land, intruded onto it during the term of that lease. What was eventually extinguished by adverse possession was only the estate of a dispossessed lessee to that part of the shed which had intruded, and not the title of the landlord. As Lord Radcliffe observed, provisions like s 24 extinguish no more than "the title of the dispossessed against the dispossessor"153. In other words, whatever "title" is extinguished is not extinguished against the whole world. Rather, it is extinguished against the dispossessor. The mortgages in this case were registered pursuant to the Land Title Act 1994 (Qld) over Torrens land. When s 34 of the Real Property Limitation Act 1833 (UK) was enacted, the title of the mortgagee was either legal title to the land, or, 149 Beaulane Properties Ltd v Palmer [2006] Ch 79 at 102 [69(d)]. 150 Miscamble v Phillips and Hoeflich [1936] St R Qd 136 at 149 per R J Douglas and Webb JJ. The law was changed by the Real Property Acts Amendment Act 1952 (Qld); see now s 185(1)(d) of the Land Title Act 1994 (Qld). 151 Division 5 sets out a process whereby an adverse possessor can apply for registered title over the relevant land with the result that the registered interest of the dispossessed owner of that land is cancelled. 153 Fairweather v St Marylebone Property Co Ltd [1963] AC 510 at 539. in the case of an equitable mortgage, an equitable interest in the land154. In contrast, the "title" held by the respondents here that is capable of being extinguished by s 24 is a species of statutory charge, giving them an interest but not an estate in land155. As such, it involves no ownership of the land156. No one disputed that this interest was a form of "title" for the purposes of s 24. Here, the respondents as mortgagees became "dispossessed" of their title, and the lands relevantly became subject to adverse possession as against them, upon the failure by the appellants to pay the principal and interest owing for the prescribed period of years157. Section 24 is relevantly here an ancillary provision intended to facilitate the better operation of s 13 of the Limitation Act. The reference in s 24 to the "period of limitation prescribed by this Act within which a person may bring an action to recover land" is a reference to s 13 and its operation. As such, the phrase "may bring an action to recover land" in s 24 must be read, as in the case of s 13, not literally, but as a reference to a defendant's ability to plead that a claim is statute- barred. As Keane J said in Brisbane City Council v Amos158: "[L]imitation statutes have a long history, in the course of which the courts have glossed the statutory language to an extent that might not now be regarded as acceptable in terms of the separation of the roles of the legislature and judiciary. It has, for example, long been settled by judicial decision that legislative provision that an action 'shall not be brought' is not to be taken literally, and that the provision merely provides a defence to the action that must be pleaded by a defendant if the expiration of the limitation period is to be given effect." 154 Santley v Wilde [1899] 2 Ch 474 at 474 per Lindley MR, cited in Cambridge Credit Corporation Ltd v Lombard Australia Ltd (1977) 136 CLR 608 at 615 per Barwick CJ, Mason and Jacobs JJ. 155 Swanston Mortgage Pty Ltd v Trepan Investments Pty Ltd [1994] 1 VR 672 at 674 per Brooking J (Southwell and Teague JJ agreeing). 156 English Scottish and Australian Bank Ltd v Phillips (1937) 57 CLR 302 at 321 per Dixon, Evatt and McTiernan JJ. 157 Section 19 of the Limitation Act; see also Cameron v Blau [1963] Qd R 421 at 425 per Gibbs J (Mansfield CJ and Jeffriess J agreeing). 158 (2019) 266 CLR 593 at 615-616 [49] (footnotes omitted). Limitation defences are often characterised as procedural rather than substantive in nature159. That is because they usually only operate to bar a remedy and do not extinguish a plaintiff's underlying right or rights160. Whether the terms "procedural" and "substantive" are apt may be put to one side so long as it is understood that the distinction is between provisions which offer a defence based on the expiration of a given time period, and those which extinguish the claim or title of a plaintiff161. If no defence of limitation is pleaded for whatever reason, the period within which to bring an action, here for the purposes of s 13 of the Limitation Act, will have never expired. And that is so for the purposes of both ss 13 and 24. Where, however, the defence is successfully pleaded that an action to recover land is statute-barred, the effect of s 13 is that the remedy of recovery of the land is barred, and the further effect of s 24 is that the "title" of the person seeking recovery of the land is "extinguished". Section 24 thus ensures that the issue of "title" is put beyond doubt where s 13 has applied, consistently with the reasons for the original enactment of s 34 of the Real Property Limitation Act 1833 (UK). This conclusion is supported by the fact that s 24 does not extinguish a person's title against the whole world, but only against the dispossessor162. Its application is limited to the dispossessor and dispossessed because it is the dispossessor who has the option to plead the defence conferred by s 13, thus triggering a possible application of s 24. 159 Pedersen v Young (1964) 110 CLR 162 at 166 per Kitto J, 166-167 per Menzies J. 160 McKain v R W Miller & Co (SA) Pty Ltd (1991) 174 CLR 1 at 18-19 per Mason CJ. 161 Australian Iron & Steel Ltd v Hoogland (1962) 108 CLR 471 at 488 per Windeyer J. 162 Fairweather v St Marylebone Property Co Ltd [1963] AC 510 at 539.

HIGH COURT OF AUSTRALIA APPELLANT AND THE QUEEN RESPONDENT Edwards v The Queen [2021] HCA 28 Date of Hearing: 19 May 2021 Date of Judgment: 6 October 2021 ORDER Appeal dismissed. On appeal from the Supreme Court of New South Wales Representation J M Morris SC with T M Ower and E M O'Neill for the appellant (instructed by Cardillo Gray Partners) L A Babb SC with J E Davidson for the respondent (instructed by Office of the Director of Public Prosecutions (NSW)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Edwards v The Queen Criminal practice – Appeal – Miscarriage of justice – Prosecution's duty of disclosure in ss 141 and 142 of Criminal Procedure Act 1986 (NSW) – Where appellant's mobile phone seized by police upon arrest – Where police made copy of data on mobile phone ("Cellebrite Download") – Where prosecution informed appellant's lawyers of existence of Cellebrite Download prior to trial but did not serve copy – Whether prosecution failed to give full and proper pre-trial disclosure required by s 142 – Whether Cellebrite Download contained material falling within s 142(1)(i) or s 142(1)(k) – Whether forensic value of contents of Cellebrite Download for appellant's case rose above level of speculation – Whether non-provision of Cellebrite Download to appellant caused miscarriage of justice. Words and phrases – "cellebrite", "cellebrite download", "disclosure", "good prosecutorial practice", "miscarriage of justice", "pre-trial disclosure", "prosecutorial duty of disclosure", "relevant to the reliability of a prosecution witness", "s 142 notice", "would reasonably be regarded as relevant". Criminal Procedure Act 1986 (NSW), ss 141, 142. KIEFEL CJ, KEANE AND GLEESON JJ. The appellant was convicted by a jury of six counts of aggravated sexual intercourse with a person aged above 10 and under 14 years of age, contrary to s 66C(2) of the Crimes Act 1900 (NSW). He contends that the trial miscarried by reason of the prosecutor's failure to provide to his lawyers, in advance of the trial, a hard drive containing a copy of data stored on the appellant's mobile telephone ("the Cellebrite Download" or "the Download"). The telephone had been seized by police when the appellant was arrested. The Download comprised over 60,000 files, including over 20,000 text messages, and was capable of being searched. The principal issue in this Court is whether the verdict at trial was a miscarriage of justice within the meaning of s 6(1) of the Criminal Appeal Act 1912 (NSW) in that the prosecution did not provide "full and proper" disclosure of the Cellebrite Download to the appellant prior to trial, contrary to the requirements of s 142 of the Criminal Procedure Act 1986 (NSW) ("the Act"). By s 141(1)(a) of the Act, the prosecutor was required to "give notice of the prosecution case to the accused person in accordance with section 142". Pre-trial disclosure required by s 141 is to take place before the date set for the trial in the proceedings and in accordance with a timetable determined by the court1. Section 142(1) provides relevantly: "For the purposes of section 141(1)(a), the prosecution's notice is to contain the following: a copy of any information, document or other thing provided by law enforcement officers to the prosecutor, or otherwise in the possession of the prosecutor, that would reasonably be regarded as relevant to the prosecution case or the defence case, and that has not otherwise been disclosed to the accused person, a copy of any information in the possession of the prosecutor that is relevant to the reliability or credibility of a prosecution witness, 1 Criminal Procedure Act 1986 (NSW), s 141(2). Although the Office of the Director of Public Prosecutions ("the ODPP") had informed the appellant's lawyer of the existence of the Download prior to the trial, it did not serve a copy of the Download or otherwise provide any information from the Download. The appellant's lawyer only became cognisant of the Download after the ODPP served a statement of a witness, Ms Birchill, on the Friday before the trial was scheduled to commence. When questioned about how the prosecution had located Ms Birchill, the ODPP told the appellant's lawyer that her details had been obtained from the Download. The appellant did not seek any relief following the late disclosure of Ms Birchill's statement, such as an adjournment of the trial pursuant to s 146(3) of the Act or exclusion of Ms Birchill's evidence. For the following reasons, the verdict against the appellant was not affected by a miscarriage of justice and the appeal must be dismissed. Background facts The appellant was, at all relevant times, a personal trainer. The complainant is the niece of the appellant's former wife. In late 2012, she was aged around 13 years. There were seven counts on the indictment, the second count being an alternative count of indecent assault. The Crown case was that the assaults the subject of the first five counts took place in the appellant's utility truck at Hudson Park near Newcastle before a boot camp conducted by the appellant; the assaults alleged in the sixth and seventh counts were alleged to have taken place in the male toilets at the same park, before another boot camp. The ODPP repeatedly disclosed the existence of the Cellebrite Download to the appellant through his lawyer. At committal, the evidence served by the ODPP included a statement of Detective Senior Constable Pacey which recorded that the appellant's mobile telephone was in the possession of the police, and a statement of Senior Constable Rowe which referred to the use of a "Cellebrite phone downloading device" to obtain information stored on the appellant's telephone, which was then used to generate an electronic report. On 16 April 2018, the Download was listed in a single-page brief index annexed to the prosecution's notice purportedly provided pursuant to s 142 of the Act ("the s 142 notice"). The following day, the Download was listed in a two- page brief index annexed to the s 142 notice for a separate prosecution against the appellant. On 3 May 2018, the ODPP sent the appellant's lawyer an updated brief index comprising two pages, which referred to the Cellebrite Download in relation to the statement of Senior Constable Rowe, and also listed a "Hard-Drive containing Cellbrite [sic]" under the heading "Electronic Material". The covering letter stated, relevantly: "I have also enclosed an updated Crown brief index. If there are any outstanding items, please let me know as a matter of urgency and I will provide these items to you." The appellant's lawyer did not respond to this request. On 8 May 2018, the ODPP sent the appellant's lawyer a proposed witness/exhibit list and a request to confirm whether the witnesses marked "not required" would be required for cross-examination. One of these witnesses was identified as "Michael Rowe cellebrite download". On Friday 11 May 2018, at 4.53 pm, the prosecution served a short handwritten statement taken from Ms Birchill and recorded in a police notebook. The statement was summarised by Leeming JA as follows2: "Ms Birchill ... said that she attended boot camps conducted by the appellant in around 2012, including at Hudson Park early in the morning. In her statement, she said that people attending the class put their stuff near the toilet block, and that while she only used the toilet there once, the accused had a key to it. She said she had had a conversation with him 'where he told me he had applied to the Council for permission to use the park and that's why he had a key to the toilet block'." The trial Only two aspects of the trial are germane to the issue agitated by the appellant in this Court. They may be summarised shortly. First, the prosecutor's case included a statement of facts that referred to an alleged text message to the complainant while she was at school prior to the alleged assaults. The text concerned the discovery, by the appellant's former wife, that the complainant had accessed a pornographic movie on her iPod. The complainant gave evidence, broadly consistent with the statement of facts, that the appellant had sent her a text message while she was at school stating that she should delete the video and the text message. The complainant was not cross-examined on this evidence. Secondly, Ms Birchill gave unchallenged evidence that the appellant had a key to the gate that opened the toilet block at Hudson Park and was cross-examined 2 Edwards v The Queen [2020] NSWCCA 57 at [20]. briefly on matters not relevant to the issue in this Court3. Ms Birchill's evidence was significant because it corroborated the complainant's evidence concerning two matters: that the appellant had a key to the toilets at the park around the time of the alleged offending; and also that the appellant sometimes conducted the boot camp at an indoor car park when it was raining. Notwithstanding the references to the Cellebrite Download in the brief index, ultimately the Crown did not tender any data comprised in the Download. Provision of the Cellebrite Download to the appellant's lawyer On Friday 18 May 2018, after the trial had adjourned to resume for the trial judge's summing up the following Monday, the appellant's lawyer asked the ODPP how Ms Birchill came to the attention of the officer in charge. The ODPP responded, saying that Ms Birchill's details were obtained from the Cellebrite Download. Later that day, the appellant's lawyer requested a copy of the Download. A copy was provided on Wednesday 23 May 2018, the day after the appellant's conviction. Court of Criminal Appeal In the Court of Criminal Appeal, the appellant's principal submission was that there had been a breach of the prosecutorial duty to disclose when on 11 May 2018 the Crown had disclosed the new witness statement of Ms Birchill, but had not disclosed that she had come to the Crown's attention through review of the Cellebrite Download4. As Leeming JA (Johnson and Harrison JJ agreeing) put it5: "The gravamen of the case sought to be advanced in this appeal is that had the Crown disclosed not merely that it proposed to call Ms Birchill and the evidence she was expected to give, but also that her identity and contact details had been found on the material extracted from the appellant's handset, then the appellant would have been alerted to the fact that the handset could be mined for potentially useful information for the defence." In the Court of Criminal Appeal two aspects of the information constituting the Download were identified as not having been disclosed, being: (1) the fact that 3 Edwards v The Queen [2020] NSWCCA 57 at [23]. 4 Edwards v The Queen [2020] NSWCCA 57 at [40]. 5 Edwards v The Queen [2020] NSWCCA 57 at [61]. those records had been used to identify Ms Birchill as a potential Crown witness and to contact her; and (2) the fact that those records might lead to identifying other witnesses, who might assist the defence6. As to (1), the Court of Criminal Appeal concluded that it was not part of the prosecution's obligation to disclose how the police or persons within the ODPP went about identifying Ms Birchill7. The appellant does not challenge that conclusion in this Court. As to (2), the Court of Criminal Appeal did not accept that the duty of disclosure extended to require the Crown "to tell the defence (a) in general terms that the information extracted from the appellant's own handset might be of utility to the defence, or (b) specifically, that there were numerous text messages between the appellant and another witness during the period specified in the indictment, such that that witness might be of interest to the defence"8. Proposition (b) is also no longer part of the appellant's case. Leeming JA did not accept that it was necessary for the Crown to do more than make available in electronic form the information extracted from the appellant's own mobile handset. His Honour concluded9: "It cannot be the case that the Crown is obliged to hunt through what is apt to be an enormous quantity of electronic information in order to identify potentially exculpatory material, in circumstances where it has disclosed the material in its entirety, taken from the appellant's own handset. Litigation is adversarial. In criminal proceedings, the Crown must prove its case, to the criminal standard, and following a fair trial. But it is not for the Crown, at least in any ordinary case, to second-guess or anticipate the ways in which materials disclosed by it might assist the defence. There may perhaps be exceptions to the foregoing general rule (one example might perhaps be certain criminal proceedings involving an unrepresented accused), but that is not the present case." 6 Edwards v The Queen [2020] NSWCCA 57 at [48]. 7 Edwards v The Queen [2020] NSWCCA 57 at [50]. 8 Edwards v The Queen [2020] NSWCCA 57 at [51]. 9 Edwards v The Queen [2020] NSWCCA 57 at [60]. In this Court, the appellant does not seek to challenge that conclusion. Having regard to the arguments advanced in the Court of Criminal Appeal, there was no occasion for their Honours to engage in a comprehensive consideration of s 142(1)(i). Instead, Leeming JA proceeded on the basis, considered to be favourable to the appellant, that the Act does not cover the field concerning the prosecutorial duty of disclosure. The Court of Criminal Appeal held that no miscarriage of justice had been established10. Appeal to this Court In this Court, the appellant argued that s 142 required disclosure of the Cellebrite Download, by provision of the whole of the information constituting the Download on a hard drive, because the whole of its contents was of potential use to the defence. It was contended that the mere identification of the Download's existence was insufficient. The contention was not that s 142(1)(i) required the disclosure of the Download as a "thing", but that the entirety of the Download was "information" within the meaning of s 142(1)(i). The proper interpretation of s 142(1) may raise a number of issues that do not fall to be determined in this case. They include the scope of the phrase "would reasonably be regarded as relevant". It is not necessary to discuss the extent of its reach. Nor is it appropriate where the proposition that all the information on the Download satisfied this requirement was not addressed in the Court of Criminal Appeal or in this Court. Argument in this Court did not proceed upon any assumption or concession by the respondent as to the correctness of such a proposition. In any event, s 142 is only one of several sources of the prosecutorial duty of disclosure, as Leeming JA correctly apprehended. In addition, there is the question of good prosecutorial practice. It is sufficient in this case to observe that when a prosecutor is in possession of a download of this kind it would accord with good prosecutorial practice to provide a copy of it to the defence. Consideration It is well settled that the prosecution's failure to disclose all relevant evidence to an accused may, in some circumstances, require the quashing of a verdict of guilty11. 10 Edwards v The Queen [2020] NSWCCA 57 at [61]. 11 Grey v The Queen (2001) 75 ALJR 1708 at 1713 [23], 1714 [26]-[27] per Gleeson CJ, Gummow and Callinan JJ, 1722 [71]-[72] per Kirby J, 1724 [83] per The difficulty for the appellant is that, with the benefit of access to the Cellebrite Download, he has been unable to identify how its contents, either as a whole or in relation to particular data, "would reasonably be regarded as relevant to the prosecution case or the defence case", or are "relevant to the reliability" of the complainant, or any respect in which his entitlement to a fair trial according to law was adversely affected by not being provided with a copy of the Download. The appellant's argument as to the forensic value of the Cellebrite Download for his case was put at the level of speculation. Whatever the precise scope of s 142(1)(i), it plainly does not extend to all information in the possession of the prosecutor or to information that does no more than provide a potential avenue for inquiry12. The appellant argued that, without the Download, he had lost the chance of a different outcome at trial on the basis of further investigations, cross-examination and submissions to the jury that he might have made concerning two matters: (1) the lack of any record on the Download of the text from the appellant to the complainant relating to her use of pornography; and (2) the fact that information contained in the Download would have identified that Ms Birchill was formerly known by a different name (Ms Mullen). According to the appellant, with the benefit of this information, he could have undertaken further investigations prior to trial "regarding the opportunity of pollution of evidence due to pre-existing relationships" and may have prevented the Crown from submitting that Ms Birchill was an independent witness. As to the first matter raised by the appellant, there is nothing to suggest that the fact of the alleged text was or could have been in issue as part of his defence. In the Court of Criminal Appeal, the appellant had conceded that it was not possible to assume that the Download contained all data, including user-deleted data, that had been placed on that phone during the relevant period. At the trial, the Hayne J; 184 ALR 593 at 599-600, 601, 612, 615; Mallard v The Queen (2005) 224 CLR 125 at 133 [17], 141 [42] per Gummow, Hayne, Callinan and Heydon JJ, 156 [83]-[84], 157 [87] per Kirby J; Eastman v Director of Public Prosecutions [No 13] [2016] ACTCA 65 at [336]; cf R v Spiteri [2004] NSWCCA 321 at [43] (an incomplete report of the case appears at (2004) 61 NSWLR 369). 12 cf Plater and de Vreeze, "Is the 'Golden Rule' of Full Prosecution Disclosure a Modern 'Mission Impossible'?" (2012) 14 Flinders Law Journal 133 at 167-169. appellant did not even put to the complainant in cross-examination that such a text was not sent. As to the second matter, to the extent that the appellant sought to suggest that there may have been information in the Cellebrite Download that might have afforded material for cross-examination of Ms Birchill challenging her "independence" as a witness, that suggestion was abandoned in the Court of Criminal Appeal13 and could not be supported by evidence in this Court. So far as either s 142(1)(i) or (k) may have required disclosure of information concerning Ms Birchill, it was satisfied by the provision, albeit late (and possibly in breach of s 141(2) of the Act), of Ms Birchill's witness statement concerning her dealings with the appellant at Hudson Park during the period relevant to the case. The appellant's argument, even with the benefit of hindsight, did not identify any further information in the Cellebrite Download that "would reasonably be regarded as relevant to the prosecution case or the defence case", or that is "relevant to the reliability" of Ms Birchill. If there was a contravention of s 141(2) of the Act by the late delivery of Ms Birchill's statement (and the appellant makes no complaint about that), it has not been shown that the fairness of the appellant's trial was thereby prejudiced. In any event, an adjournment might have been, but was not, sought by the appellant under s 146(3) of the Act to enable inquiries to be made about Ms Birchill and her dealings with the appellant. All this being so, it cannot be said that any breach of s 141(2) gives rise to a miscarriage of justice. As the appellant observed, the prosecution was able to mine the Cellebrite Download for useful information prior to the trial and ultimately the prosecution identified relevant, and arguably critical, evidence by searching the Download. On that basis, the appellant argued that there was an inequality of arms: the appellant's lawyers, who did not have a copy of the Download (although they could have asked for one), did not have the same ability. No doubt, the ODPP could have provided a copy of the Download to the appellant cheaply and easily, without waiting for any request from him and thereby obviating any perception of unfairness. On the other hand, if the appellant gave instructions suggesting inquiries that could have been pursued by searching his telephone, there was no impediment to the appellant calling for a copy of the Download, readily searchable, because its existence had been clearly identified by the ODPP. 13 Edwards v The Queen [2020] NSWCCA 57 at [46]. Conclusion The appeal must be dismissed. EdelmanJ Equality of arms and duties of disclosure An indictment is brought against an accused person for alleged sexual offences. An issue at trial is likely to be the location of the accused person at relevant times when he was conducting fitness training with clients. The accused's mobile phone is seized pursuant to a search warrant and is in the possession of the police. Like all smart phones it is likely to, and does, contain GPS coordinates of locations, calendar entries, and texts between the accused and his clients, who were reasonably likely to be witnesses (and one of whom became a witness). The prosecution obtains an electronic database of information downloaded from the accused's mobile phone. If the contents of the electronic database were printed, it would run to 5,900 pages. But it is in electronic form and it is keyword searchable. Some of the information in the database is central to the prosecution case. Amongst the considerable material provided to the accused person, contained in the pre-trial prosecution's notice, are references to the database. But unlike the other disclosures in the prosecution's notice, a copy is not provided. The solicitors for the accused do not notice the references to the database amongst the disclosures and they do not request a copy. Very shortly before the conclusion of the trial, the solicitors for the accused become aware of the existence of the database and request a copy of it. A copy is provided after the conviction of the accused. In a scenario in these broad terms, the principal issue on this appeal is whether the prosecution's notice given to the appellant, Mr Edwards, was required to contain a copy of the searchable electronic database just as it was required to contain physical copies of any relevant witness statement, expert report, proposed exhibit, summary, or chart. The respondent did not dispute that s 142(1)(i) of the Criminal Procedure Act 1986 (NSW) required the prosecution to disclose to Mr Edwards "a copy" of the searchable database in the prosecution's possession because it was "reasonably ... regarded as relevant to the prosecution case or the defence case". But, consistently with the reasoning of the Court of Criminal Appeal, the respondent's submission was effectively that, unlike other categories of physical document or thing possessed by the prosecution, it was sufficient disclosure of "a copy" of the searchable electronic database for Mr Edwards to be informed of its existence but not informed of, or provided with, its contents. For the reasons below, the prosecution was obliged to provide a copy of the searchable electronic database of information to the defence. Ultimately, however, the Court of Criminal Appeal was correct to conclude that there was no miscarriage of justice. Although the searchable electronic database should have been provided to the defence, Mr Edwards did not establish that there was any information in that database which was capable of providing the defence with any advantage at trial. EdelmanJ Factual background Mr Edwards was convicted after trial before a judge and jury of six counts of sexual intercourse with a child aged between ten and 14 years in circumstances of aggravation contrary to s 66C(2) of the Crimes Act 1900 (NSW). The offences occurred between 1 October 2012 and 31 December 2012. The complainant was 13 years old at the time of the offences. She is the niece of Mr Edwards' former wife. She was living with Mr Edwards and his former wife at the time of the offences. The circumstance of aggravation was that the complainant was a child under the authority of Mr Edwards. Mr Edwards conducted a business involving "boot camps", which consisted of fitness circuit training sessions. The complainant attended three of these boot camps between 1 October 2012 and 31 December 2012 when she was 13 years old. Two of them were at Hudson Park, Kotara and the third, when it was raining, was at the car park of Westfield Kotara. The charges all concerned the two boot camps at Hudson Park. Four of the charges (counts 1, 3, 4, and 5)14 related to the first boot camp that the complainant attended at Hudson Park. The complainant's evidence was as follows. On the first occasion that she attended a boot camp, she went to Hudson Park with Mr Edwards sometime after 4 am. Mr Edwards parked his car, unbuckled both seatbelts, then put his hand down the complainant's pants and started rubbing her clitoris (count 1). Mr Edwards then pulled the complainant's legs over the console between the seats, pulled her pants down and started licking her vagina (count 3) and put his finger in her vagina (count 4). He then got out of the car, opened the passenger door and put his penis in the complainant's mouth. She refused but he persisted (count 5). Mr Edwards and the complainant then set up the circuit for the attendees of the boot camp. The remaining two charges (counts 6 and 7) concerned a second boot camp, about a week later, that the complainant attended again at Hudson Park. The complainant's evidence was that she went to the boot camp with Mr Edwards in his car, again arriving at Hudson Park sometime after 4 am. Mr Edwards told the complainant to follow him to the canteen area. He had a key for the men's toilet. He took the complainant into a cubicle and sat her on the toilet seat. He put his hand into her pants and started to put his middle finger into her vagina before she told him to stop (count 6). He then put his penis into her mouth. She refused but he persisted (count 7). Subsequently, Mr Edwards and the complainant set up the circuit for the attendees at the boot camp. 14 Count 2 was an alternative count of indecent assault. EdelmanJ Around 2013 or 2014, on two occasions, which were some time apart, the complainant told her cousin about the sexual assault committed by Mr Edwards. In 2016, in the presence of her father's partner at the time (who did not give evidence), the complainant told her father about the sexual assault. The complainant's father took her to the police to make a complaint. On 6 March 2017, Mr Edwards was arrested. He has remained in custody since his arrest. On the same day as his arrest, Mr Edwards participated in a record of interview with police. In the course of his interview, Mr Edwards admitted that he held boot camps for "a group of friends" who paid for the sessions and admitted that the complainant had attended "a few" of the boot camp sessions. Mr Edwards said that he did not have any records of his training sessions back then and he said that his training sessions were all conducted at Alder Park or "down the beach occasionally". When asked if he had ever held a boot camp at Hudson Park, Mr Edwards replied that he did not think that he had and then asked the police: "Where's Hudson Park?" After he was told that Hudson Park was in Kotara, he denied having held boot camps there. He denied having a key to the toilet block at Hudson Park. The conducting of boot camps by Mr Edwards at Hudson Park, and the evidence of witnesses who attended at Hudson Park, was plainly a matter that would reasonably be expected to become, and did become, a central issue at trial. In the very brief opening statement by counsel for Mr Edwards, counsel said that "[w]here it is said this occurred is an important factor in this case". At the time of Mr Edwards' arrest, the police seized his mobile phone handset. Amongst the data contained on that phone were many thousands of text messages which had been sent and received. The police downloaded the content of the phone using a "Cellebrite phone downloading device". The electronic copy of the information extracted, the "Cellebrite download", was capable of being searched and was stored on a hard drive. Amongst the variety of information in the Cellebrite download, which included telephone contacts, GPS information, text messages, and calendar entries, there were text messages during the period of offending between Mr Edwards and clients of his boot camps. One person, Ms Elliott, who was not called as a witness by the prosecution and whose name did not appear on any prosecution witness list, exchanged 29 separate text messages with Mr Edwards during the relevant period, including text messages containing details about locations of fitness training sessions. Another, Ms Birchill, was identified by the prosecution from the Cellebrite download. On 11 May 2018, Ms Birchill gave a written statement to police. That statement formed the basis of her evidence. She said that for a couple of years she had attended boot camps with Mr Edwards. Ms Birchill first began attending the boot camps in 2012. Initially, the boot camps were at Hudson Park, although when it was raining the boot camps were conducted at the car park at Westfield in Kotara. EdelmanJ The training started at 6 am or 6.15 am and it would last for about an hour. Approximately six to eight people would attend. Ms Birchill said that on one occasion she used the toilets at Hudson Park after Mr Edwards had provided her with a key to the toilet block. She said that Mr Edwards told her that he had applied to the Council to use the park and had been given a key to the toilets. Ms Birchill's written statement was provided to the defence at around 5 pm on the day it was obtained, Friday, 11 May 2018. The trial began on Monday, 14 May 2018. No application was made either15 (i) to exclude the proposed evidence of Ms Birchill for failure to disclose in a timely fashion under s 14216, or (ii) to adjourn the trial. Ms Birchill gave oral evidence at the trial on 17 May 2018. Her oral evidence largely corresponded with her written statement. At 6.04 am the next day, Friday, 18 May 2018, Mr Edwards' solicitor emailed a solicitor at the Office of the Director of Public Prosecutions ("the OPP") asking how Ms Birchill had come to the attention of the OPP and expressing some incredulity at the coincidence in the discovery of, and the detail of, her evidence shortly before trial. The OPP solicitor responded at 9.31 am, explaining that Ms Birchill's details "were obtained from the Cellebrite download of Mr Edwards' phone". Mr Edwards' solicitor responded that afternoon saying, "I did not know about the download" and requested a copy. The OPP solicitor replied saying that inquiries would be made about providing a copy. He also observed that "the Cellebrite download was on the brief index sent to you as part of the notice of prosecution case and also in my email dated 03 May 2018". The trial resumed after the weekend, on Monday, 21 May 2018, with directions from the trial judge to the jury. No application was made by counsel for Mr Edwards for an adjournment. The jury returned verdicts of guilty on 22 May 2018. A copy of the contents of the Cellebrite download was provided by the OPP to the solicitors for Mr Edwards on 23 May 2018. The legislative provisions The patchwork of obligations and guidelines prior to 2001 Prior to 2001, prosecution disclosure in New South Wales was governed by a patchwork of common law obligations, prosecution guidelines, and statutory and ethical rules. The common law required, and still requires, disclosure of all 15 Edwards v The Queen [2020] NSWCCA 57 at [22]. 16 See Criminal Procedure Act 1986 (NSW), s 146(1). EdelmanJ material that, on a sensible appraisal by the prosecution17: (i) is relevant or possibly relevant to an issue in the case; (ii) raises or possibly raises a new issue that was not apparent from the prosecution case; and (iii) holds out a real (as opposed to fanciful) prospect of providing a lead in relation to evidence concerning (i) or (ii). Further, since the disclosure can occur prior to any crystallisation of the defence case, or any refinement of the prosecution case, expressions in relation to common law disclosure rules, such as "an issue in the case" or "all relevant evidence of help to the accused", must be given a broad interpretation18. The non-legally binding19 prosecution guidelines concerning disclosure had been promulgated by the Director of Public Prosecutions under s 13 of the Director of Public Prosecutions Act 1986 (NSW). The 1998 Guidelines required prosecutors to make full disclosure to the accused of "all facts and circumstances and the identity of all witnesses reasonably to be regarded as relevant to any issue likely to arise at trial"20. This generalised guideline was expanded in 2003, in terms still existing today, modelled on the common law duty21. The amendments in 2001 In 2001, against the background of a patchwork of these common law disclosure obligations and non-binding guidelines and ethical rules, together with some statutory provisions22, the New South Wales Parliament enacted the Criminal Procedure Amendment (Pre-trial Disclosure) Act 2001 (NSW). That Act inserted Div 2A ("Pre-trial disclosure – case management") into Pt 3 of the Criminal Procedure Act, which had the purposes of creating a "case management model" 17 R v Keane [1994] 1 WLR 746 at 752; [1994] 2 All ER 478 at 484; R v Brown (Winston) [1998] AC 367 at 376-377. See also R v Reardon [No 2] (2004) 60 NSWLR 454 at 468 [48]; R v Spiteri (2004) 61 NSWLR 369 at 373-374 [17]-[20]; R v Livingstone (2004) 150 A Crim R 117 at 126-127 [44]-[45]; R v Lipton (2011) 82 NSWLR 123 at 145-147 [77]. 18 R v Brown (Winston) [1998] AC 367 at 377. 19 See Grey (2000) 111 A Crim R 314 at 321-322 [32]. Not doubted on this point on appeal: Grey v The Queen (2001) 75 ALJR 1708; 184 ALR 593. 20 New South Wales, Office of the Director of Public Prosecutions, Prosecution Policy and Guidelines (March 1998) at 17. 21 See R v Lipton (2011) 82 NSWLR 123 at 146 [77]. 22 For instance, Evidence Act 1995 (NSW), ss 67, 97 and 98. EdelmanJ and "improv[ing] upon and formalis[ing]" the combination of common law rules, legislation, and prosecution guidelines in relation to pre-trial disclosure23. Division 2A as enacted required pre-trial disclosure by both the prosecution and the defence. A prosecuting authority was required to give an accused person a "notice of the case for the prosecution"24. Amongst the matters that the prosecution notice was to "contain" was, by the newly inserted s 47E(g) of the Criminal Procedure Act: "a copy of any information, document or other thing provided by police officers to the prosecuting authority, or otherwise in the possession of the prosecuting authority, that may be relevant to the case of the prosecuting authority or the accused person, and that has not otherwise been disclosed to the accused person." This obligation was cognate with another amendment made by the same amending Act, which inserted s 15A into the Director of Public Prosecutions Act25. Section 15A(1) provided that "[p]olice officers investigating alleged indictable offences have a duty to disclose to the Director all relevant information, documents or other things obtained during the investigation that might reasonably be expected to assist the case for the prosecution or the case for the accused person". As the author of a contemporaneous parliamentary briefing paper observed26, these legislative reforms were intended to introduce "a general duty of disclosure upon police officers involved in the investigation of an offence" and a corresponding obligation upon the prosecution to disclose to the defence "copies of any relevant information provided by the police to the prosecution". 23 New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 16 August 2000 at 8288. 24 Criminal Procedure Act, s 47D. 25 Criminal Procedure Amendment (Pre-trial Disclosure) Act 2001 (NSW), Sch 2. 26 Griffith, Pre-Trial Defence Disclosure: Background to the Criminal Procedure Amendment (Pre-trial Disclosure) Bill 2000, New South Wales Parliamentary Library Research Service, Briefing Paper No 12/2000 (2000) at 31-32. EdelmanJ The current provisions The current provisions relevant to this appeal, ss 141 and 142 of the Criminal Procedure Act, derive from further amendments in 201327 to "expand[] the scope of mandatory disclosure requirements in criminal trials"28. The disclosure provisions, as amended, now form part of Div 3 of Pt 3 in Ch 3, "Case management provisions and other provisions to reduce delays in proceedings". The purpose of Div 3 is to reduce delays in proceedings on indictment by requiring certain pre-trial disclosure by the prosecution and the defence, and enabling the court to undertake case management29. The relevant parts of s 141, and the heading to that section30, are as follows: "Mandatory pre-trial disclosure (1) After the indictment is presented or filed in proceedings, the following pre-trial disclosure is required: the prosecutor is to give notice of the prosecution case to the accused person in accordance with section 142, the accused person is to give notice of the defence response to the prosecution's notice in accordance with section 143, the prosecution is to give notice of the prosecution response to the defence response in accordance with section 144. Pre-trial disclosure required by this section is to take place before the date set for the trial in the proceedings and in accordance with a timetable determined by the court." 27 Criminal Procedure Amendment (Mandatory Pre-trial Defence Disclosure) Act 2013 (NSW), Sch 1. 28 New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 13 March 2013 at 18578. See also New South Wales, Legislative Assembly, Criminal Procedure Amendment (Mandatory Pre-trial Defence Disclosure) Bill 2013, Explanatory Note. 29 Criminal Procedure Act, s 134. Interpretation Act 1987 (NSW), ss 34, 35(5). EdelmanJ Section 142 concerns the "Prosecution's notice", which must be in writing31. The section relevantly provides: "(1) For the purposes of section 141(1)(a), the prosecution's notice is to contain the following: a copy of any information, document or other thing provided by law enforcement officers to the prosecutor, or otherwise in the possession of the prosecutor, that would reasonably be regarded as relevant to the prosecution case or the defence case, and that has not otherwise been disclosed to the accused person". Section 146 provides for sanctions for failures to disclose evidence, including powers for the court to refuse to admit evidence (s 146(1), (2)) or to adjourn the proceedings (s 146(3)). Central to this appeal is the meaning of the references to "disclosure" in the pre-trial "disclosure" provisions of Div 3. For four reasons outlined below, the numerous references to disclosure in Div 3 use that undefined term in a sense which, subject to exceptions, requires physical provision of documents and other things, or copies of them, if they are in physical form or can be reproduced in physical form. Again, subject to exceptions, only if the things cannot be physically or legally reproduced by the prosecution is it sufficient for the prosecution merely to inform or "list" for the defence the identity of the information, document or thing and the place where it is situated. In short, the meaning of "disclosure", in Div 3, including ss 141 and 142, is a default requirement of providing something unless the thing has no physical existence. First, s 142 requires that the core of the prosecution's disclosure obligations – the prosecution's notice – "contain" numerous things: a copy of the indictment; a statement of facts; and copies of witness statements of witnesses whose evidence the prosecution proposes to adduce at trial. It must also contain all of the following if the prosecution proposes to adduce evidence contained in it at trial: copies of any "recorded statement", document, summary, exhibit, chart or explanatory material, and expert report; and, critically, copies of "any information, document or other thing" that would reasonably be regarded as relevant to either the prosecution or defence case. The copies of all these things could only be 31 Criminal Procedure Act, s 149(1). EdelmanJ "contained" in the prosecution's notice if they were physically reproduced in the prosecution's notice. Secondly, in contrast with the requirement for the prosecution's notice to "contain" a copy of various things, if the information, document or thing is not in the possession of the prosecutor or the accused then s 142(1)(j) requires only that the prosecution's notice contain a list which identifies any "information, document or other thing of which the prosecutor is aware and that would reasonably be regarded as being of relevance to the case" and which identifies the place at which the prosecutor believes the information, document, or other thing is situated. In other words, the lesser obligation upon the prosecution to provide only a list containing the prescribed information applies only where the prosecution does not possess the information, document, or other thing which could be copied. Thirdly, s 142 is subject to an exception contained in s 149A, which provides that a copy of a proposed "exhibit, document or thing" is not required to be included in a notice under Div 3 if "it is impossible or impractical to provide a copy". In that event, the party required to give the notice is required (i) to specify in the notice a reasonable time and place at which the proposed exhibit, document, or thing may be inspected, and (ii) to allow the other party to the proceedings a reasonable opportunity to inspect the proposed exhibit, document, or thing referred to in the notice. This exception further highlights the operation of the rule of disclosure. The rule is a default requirement of providing things which have a physical existence, not merely informing the other party of their existence and making them available for inspection, unless the specific exception is satisfied. Fourthly, the meaning of "disclosure" in s 141 is also plain from the cognate provision in s 15A of the Director of Public Prosecutions Act. The requirement in s 15A(1) for the police to "disclose" to the Director "all relevant information, documents or other things" is subject to exemptions in s 15A(6), such as privilege and statutory publication restrictions, from the requirement to "provide to the Director any information, documents, or other things". If one of those exemptions is satisfied, then unless the Director requests that the information, document, or thing be provided, the police need only inform the Director of the existence and nature of the information, document, or thing, and the claim or publication restriction relating to it32. In s 15A, in relation to any relevant physical document or thing in the possession of the police, "disclose" means "produce"33. 32 Director of Public Prosecutions Act 1986 (NSW), s 15A(7). 33 See also R v Lipton (2011) 82 NSWLR 123 at 152 [104]. EdelmanJ Breach of the prosecution's obligation of disclosure The common assumptions A common assumption underlying the submissions in this Court was that the Cellebrite download was "any information, document or other thing" within the terms of s 142(1)(i). The respondent did not make any submission about whether the Cellebrite download, as a searchable database, fell within the category of information, document, or other thing, or whether it fell within more than one of those categories. Whether or not it also fell within other categories, Mr Edwards correctly submitted that the contents of the Cellebrite download fell within the category of "document" as defined in the Dictionary to the Evidence Act 1995 (NSW), which, like the Interpretation Act 1987 (NSW)34, defines a "document" as meaning "any record of information" and relevantly includes "anything from which sounds, images or writings can be reproduced with or without the aid of anything else". Clause 8 of Pt 2 of the Dictionary to the Evidence Act also provides that a reference in the Act to a "document" includes a reference to "any part of the document". A further common assumption underlying the submissions in this Court was that, at the time of pre-trial disclosure, the duty in s 142(1)(i) was engaged because the contents of the Cellebrite download "would reasonably be regarded as relevant to the prosecution case or the defence case". The whole of the respondent's argument concerning the scope of the exception in s 142(1)(i), which we consider below, was premised upon an assumption that the duty in s 142(1)(i) was engaged. This assumption was also correctly made. Like the approach taken by the common law to expressions such as "an issue in the case" or "all relevant evidence of help to the accused", the expression "would reasonably be regarded as relevant" must be applied at a high level of generality. This is particularly so because the prosecution might be required to assess relevance to the defence case for the purposes of the prosecution's notice before receiving the defence response35 and possibly even without the benefit of any substantial comments in a video record of interview. Ascertaining what "would reasonably be regarded as relevant" for the purpose of s 142(1)(i) does not mandate an adjudication about the actual relevance of the information, document, or thing. Rather, it imposes a requirement to assess fairly the inherent likelihood that an item of evidence is going to be relevant to either the prosecution or defence case. The phrase "be regarded" directs attention to the potentiality of evidence to be relevant, and the phrase "would reasonably" Interpretation Act 1987 (NSW), s 21(1). 35 See Criminal Procedure Act, s 143. EdelmanJ excludes any necessity to disclose material that is only possibly or remotely relevant. In this case, at the time the prosecution's notice was given, and subsequently, the record of information contained in the Cellebrite download would reasonably have been regarded as relevant to the prosecution case or the defence case. It included, and should reasonably have been regarded as including, telephone contacts, GPS information, calendar entries, and text messages between Mr Edwards and clients of his boot camps. Some of that information proved to be very significant to the prosecution case. No party to this appeal suggested that the prosecution's disclosure obligation extended only to some subset of the record of information in the Cellebrite download. Such a suggestion was also rightly rejected by Leeming JA in the Court of Criminal Appeal, who observed that it is not uncommon for the prosecution to possess enormous quantities of electronic information including sound recordings and that there would be a "panoply of problems" if the prosecution were required to interrogate the database to determine which particular items of information would reasonably be regarded as relevant to the defence case: "One person who spends an hour interrogating a database might conclude there was nothing useful, another who conducts different searches might reach a different conclusion, and a third who spends a day might conclude that in truth there was nothing that assisted either side."36 Most fundamentally, it is no part of the duty of a prosecutor to "conduct the case for the defence"37. The Cellebrite download was not otherwise disclosed The respondent submitted that the prosecution was not required by s 142(1)(i) to provide Mr Edwards with a copy of the Cellebrite download because a copy of that download had "otherwise been disclosed" to him within the exception to the duty in s 142(1)(i). The respondent pointed out that the prosecution informed the defence of the existence of the Cellebrite download on numerous occasions prior to trial and that the Court of Criminal Appeal had treated (1) On 16 April 2018, the prosecution provided Mr Edwards' solicitor with a "notice of prosecution case", which included a brief index and cover page saying that "[a]ll statements and documents proposed to be relied upon at 36 Edwards v The Queen [2020] NSWCCA 57 at [58]. 37 R v Brown (Winston) [1998] AC 367 at 379. 38 Edwards v The Queen [2020] NSWCCA 57 at [60]. EdelmanJ this time by the prosecution have been served as part of the brief of evidence". The index contained 27 items. One of those was "Hard-Drive containing: a) Phone Download Report – Scott Edwards (iphone 6 EFIMS X0002614993)". The hard drive itself had not been provided. In an email dated 17 April 2018, a solicitor at the OPP asked Mr Edwards' solicitor to "Please let me know if there are any brief items at Annexure C that you don't have". An updated brief was provided to Mr Edwards' solicitor on 3 May 2018, which also contained a reference to the hard drive. (2) One of the statements contained in the prosecution brief was from Senior Constable Rowe, who referred to Mr Edwards' phone in his statement and said: "I utilised a Cellebrite phone downloading device to obtain information stored on this phone. This download was then created into an electronic report. I now produce download report". No download report was contained in the brief. (3) On 8 May 2018, the prosecution supplied a "proposed witness/exhibit list" to Mr Edwards' solicitor and asked Mr Edwards' solicitor to confirm whether any of the witnesses marked "not required" by the prosecution were required by Mr Edwards. Senior Constable Rowe was listed as "not required". The respondent's submission was effectively that by informing Mr Edwards of the existence of the Cellebrite download on these occasions it had "otherwise ... disclosed" a copy of the Cellebrite download. In effect, the respondent's submission in this Court was that the words "has not otherwise been disclosed to the accused person" in s 142(1)(i) meant that a copy of a "document" (being a record of information) need not be provided to the accused person so long as the accused person is told of the existence, but not the contents, of the document. This submission is contrary to the text, context, and purpose of s 142(1)(i). As to the text, it would treat disclosure of an electronic record of information stored in a physical form such as a hard drive in a fundamentally different way from any other record of information in physical form such as any other document, summary, exhibit, chart, explanatory material, or expert report. The meaning of "otherwise ... disclosed" textually connotes a circumstance where disclosure, in the sense of provision of any type of physical document or thing, has occurred otherwise than in the prosecution's notice. The only possible textual indication to the contrary, upon which the respondent relied, is that s 149D exempts the prosecution from including in a notice anything that "has otherwise been provided or disclosed to the accused person". The respondent submitted that the use of "disclosed" as an alternative to "provided" meant that disclosure was more limited than "providing". That submission is not correct. The mandatory pre-trial "disclosure" required by ss 141 EdelmanJ and 142 cannot possibly be understood as requiring anything less than physical provision of documents including a copy of the indictment, a statement of facts, or a copy of the statement of each witness whose evidence the prosecutor proposes to adduce at trial. The expression "provided or disclosed" in s 149D uses "disclosed" in the same sense as its meaning in ss 141 and 142, overlapping with "provided" when a physical document or thing in the possession of the prosecution is concerned, but otherwise extending to merely providing the defence with information. The respondent's submission is also inconsistent with the context and history of the concept of "disclosure" in s 142(1)(i), and the cognate provision in s 15A of the Director of Public Prosecutions Act. As explained above, disclosure in the Director of Public Prosecutions Act requires a physical document or thing to be provided. It is notable that the respondent eschewed any submission that the police had not been required to provide the Cellebrite download to the Director. As to purpose, if the respondent's submission were correct then the functions of s 142(1)(i) concerning case management and reduction of delays would be substantially impaired. The prosecution would be obliged to inform an accused person of the existence of a large database repository of electronic information but not obliged to provide any of that information to the defence prior to trial. Since the prosecution is not required to interrogate any database in order to ascertain which items within it are relevant to the defence case, the consequence of the respondent's submission would be that the larger the field of potential disclosure, the more uncertainty would exist and the greater the potential for injustice for an accused person. In other words, in situations where the most clarity is required in the course of case management, s 142(1)(i) would provide the least clarity. For these reasons, the failure of the prosecution to provide Mr Edwards with a copy of the Cellebrite download was a breach of the duty in s 141(1)(a) by reason of a failure to comply with s 142(1)(i) of the Criminal Procedure Act. No miscarriage of justice Miscarriage of justice requires practical injustice In Weiss v The Queen39, this Court said that "a 'miscarriage of justice', under the old Exchequer rule, was any departure from trial according to law, regardless of the nature or importance of that departure". A departure from a trial according (2005) 224 CLR 300 at 308 [18] (emphasis in original). EdelmanJ to law requires some erroneous occurrence with "the capacity for practical injustice"40 or which is "capable of affecting the result of the trial"41. This question of the capacity for practical injustice is anterior to the question, in the common form proviso, of whether the prosecution can establish that any legal error or miscarriage of justice was insubstantial including in the sense that it could not "actually"42 have affected the result or in the sense that the result was nevertheless "inevitable"43. The need for practical injustice means that whether a miscarriage of justice arises as a result of a failure by the prosecution to call a particular person as a witness at trial will be assessed "against the conduct of the trial taken as a whole"44. So too, all the circumstances of the trial must be assessed when considering whether a miscarriage of justice arises as a result of the failure of the prosecution to make a required disclosure under s 141(1)(a) read with s 142(1). The generalised nature of Mr Edwards' submissions the manner the non-disclosure amounted to practical injustice that could constitute a miscarriage of justice generally consisted of vague and unspecified allegations. Despite Mr Edwards having had the opportunity to consider, and to have carefully examined, the information in the Cellebrite download after trial and before his appeal to the Court of Criminal Appeal, his allegations of how the information might have affected the trial did not generally descend to any specifics. For instance, he claimed that he was: in which deprived of the ability to identify other clients who could give evidence that training in the relevant period was held at Alder Park, and to identify other witnesses from his telephone contact list – but only one specific client was identified (discussed below); 40 MZAPC v Minister for Immigration and Border Protection (2021) 95 ALJR 441 at 477-478 [162], see also at 462-463 [85]; 390 ALR 590 at 631, see also at 610-611. 41 R v Matenga [2009] 3 NZLR 145 at 158 [31] (emphasis in original). See also Cesan v The Queen (2008) 236 CLR 358 at 392-393 [116]-[122], 393-396 [123]-[132]. 42 Weiss v The Queen (2005) 224 CLR 300 at 308 [18]. 43 For instance, R v Dickman (2017) 261 CLR 601 at 605 [4]-[5], 620 [63]. 44 R v Apostilides (1984) 154 CLR 563 at 575. EdelmanJ (iii) unable to obtain expert evidence, or alternative expert examination, with respect to what was demonstrated on the Cellebrite download – but no submission was made about how that expert evidence might have assisted; constrained in his defence because he was unaware of electronic records that might have established a "particular defensive position" – but no defensive position was specified; unable to seek a warning under s 165 of the Evidence Act at trial as to unreliability of evidence – but the evidence said to be unreliable was not identified; and unable to cross-examine the complainant about her training with him in July 2013, said to be revealed by a calendar entry – but he did not explain how the complainant attending a training session with him more than six months after the last set of offences was capable of affecting the reasoning of the jury as to whether the offences occurred. In three respects, Mr Edwards' claims were more specific. However, the first claim, and a claim in response by the respondent, relied upon inadmissible evidence. And the second and third claims did not establish any practical injustice. Reliance on inadmissible evidence In this Court, both parties relied upon various content of the Cellebrite download to make submissions concerning whether a miscarriage of justice arose from the erroneous failure by the prosecution to provide the Cellebrite download to the defence. Both parties relied upon material that had been excluded as inadmissible by the Court of Criminal Appeal in rulings which were not challenged in this Court. Mr Edwards relied upon evidence from a private investigator that a Facebook search conducted by the investigator had revealed that Ms Birchill had a daughter who attended the same school as the cousin of the complainant. Mr Edwards relied upon this evidence to submit that he had lost an opportunity to challenge the complainant and Ms Birchill on any relationship or knowledge that they had of each other prior to trial. Mr Edwards' submission cannot be accepted for the simple reason that, before the Court of Criminal Appeal, objection was taken to this part of the proposed evidence from the private investigator and it was not relied upon by Mr Edwards. The respondent also relied upon inadmissible material in response. The respondent relied upon a text message sent from Mr Edwards to a boot camp client on 25 February 2013 saying "[t]raining at Hudson Park this morning". That message might have provided significant support to the prosecution case, since in Mr Edwards' video record of interview he had denied knowing the location of EdelmanJ Hudson Park and he had denied having conducted boot camps at Hudson Park. But no evidence of that text was given at trial and it was not admitted as evidence in the Court of Criminal Appeal. It cannot be relied upon in this Court. Alleged absence of a text message on his mobile phone Part of the prosecution case was that prior to the offences the relationship between the complainant and Mr Edwards had become "sexualised". The complainant gave evidence that towards the end of 2012 she had accessed heterosexual pornography on her iPod. Her aunt gave evidence that she found a pornographic video on the complainant's iPod. The complainant's aunt said that she informed Mr Edwards about it and that Mr Edwards spoke with the complainant about it. The complainant also gave evidence that Mr Edwards sent her a text message saying that she should delete the video or the history and that Mr Edwards subsequently had a private conversation with her about it. She also gave evidence that, subsequently, in 2012, Mr Edwards had asked her whether she shaved her pubic hair. Mr Edwards submitted that due to the prosecution's failure to disclose the contents of the Cellebrite download, he was unable to lead evidence to demonstrate that he did not send the alleged text message instructing the complainant to delete the video or history from her iPod. One significant obstacle to this submission by Mr Edwards is that the Court of Criminal Appeal excluded as inadmissible evidence, without an established basis, the statements in the private investigator's affidavit that the Cellebrite download did not contain any message from Mr Edwards telling the complainant to delete the video or history from her iPod. But even if this evidence had been admitted in support of a conclusion that no text existed on Mr Edwards' phone, it is difficult to see how this could have assisted his case at trial. It was not suggested to the complainant in cross-examination that the text had not been sent. And, perhaps more fundamentally, whether Mr Edwards told the complainant to delete the video in a text message or in a conversation, and indeed the content of any such exchange, was immaterial to any issue at trial. Pertinently, although it was put to the complainant in cross-examination that Mr Edwards had not asked her about shaving her pubic hair, there was no cross-examination of the complainant or of her aunt to cast any doubt on their evidence that Mr Edwards had a conversation about the pornographic video. A new witness who might have been called? Before the Court of Criminal Appeal, Mr Edwards relied upon evidence that the Cellebrite download contained 29 separate text messages between Mr Edwards and Ms Elliott during the period of alleged offending in which they communicated about matters including the boot camps. The Court of Criminal Appeal concluded that the highest Mr Edwards' case could be put was that Ms Elliott was a witness whose evidence, if it had been adduced, was "most unlikely to have affected the EdelmanJ trial"45. It would, however, be enough to establish a miscarriage of justice if there was a basis to say that the evidence of Ms Elliott was capable of affecting the result of the trial, irrespective of how unlikely it was that it would do so. The evidence of Ms Elliott's text messages could not have had any impact upon the trial at all. Her messages concerned boxing training sessions that Mr Edwards would conduct for her and sometimes for her children. It appears from the texts that all the sessions were in the afternoon and most, if not all, were held at Mr Edwards' home. On the evidence before this Court, the only fact that Ms Elliott could have established was that Mr Edwards had clients, whom he generally trained at his home, separately from the boot camp sessions that he said in his video record of interview were conducted at Alder Park or the beach at 6 am. The existence of other clients of Mr Edwards who were trained at a different place from the boot camps was not capable of having any effect upon the case. Conclusion The appeal must be dismissed. 45 Edwards v The Queen [2020] NSWCCA 57 at [61].

HIGH COURT OF AUSTRALIA AND APPELLANT AUSTRALIAN CRIME COMMISSION & ORS RESPONDENTS Hogan v Australian Crime Commission [2010] HCA 21 16 June 2010 ORDER Appeal dismissed. Appellant to pay the costs of the third respondents. On appeal from the Federal Court of Australia Representation J T Gleeson SC with F Kunc SC and P Kulevski for the appellant (instructed by Robinson Legal) S J Gageler SC, Solicitor-General of the Commonwealth with D F C Thomas for the first and second respondents (instructed by Australian Government Solicitor) D F Jackson QC with T D Blackburn SC and T Maltz for the third respondent (instructed by Blake Dawson Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Hogan v Australian Crime Commission Federal Court of Australia – Powers – Restriction of publication of evidence – Section 50 of Federal Court of Australia Act 1976 (Cth) ("the Act") provided Federal Court may make such order forbidding or restricting publication of evidence as appears necessary to prevent prejudice to administration of justice or the security of the Commonwealth – Forensic decision to tender documents in evidence, under cover of s 50 order but pending further hearing – Order vacated at further hearing – Whether s 50 order no longer necessary to prevent prejudice to administration of justice – Whether inherent confidentiality sufficient to establish prejudice – Relevance of s 17(1) of the Act, requiring exercise of jurisdiction in open court, and relationship with s 50. Federal Court of Australia – Practice and procedure – Inspection of documents by non-party – Interests of open justice – Principles applicable to exercise of power to grant leave under Federal Court Rules, O 46 r 6(3) – Relevance of existing order made under s 50 of the Act. Words and phrases – "administration of justice", "confidential", "necessary". Federal Court of Australia Act 1976 (Cth), ss 17(1), 50. Federal Court Rules, O 46 r 6(3). FRENCH CJ, GUMMOW, HAYNE, HEYDON AND KIEFEL JJ. The present litigation arises out of a special investigation conducted by the first respondent, the Australian Crime Commission ("the ACC"), known as Operation Wickenby. In the course of its investigation, the ACC issued a notice under s 29 of the Australian Crime Commission Act 2002 (Cth) ("the ACC Act") requiring an accounting firm ("the Accountants") to produce documents concerning a number of individuals and entities, including the appellant ("Mr Hogan"). He has been a public figure for many years, in particular since the success of the film "Crocodile Dundee"1. Under the ACC Act, an examiner may by notice in writing served on a person require that person, on pain of committing an offence by non-compliance to a "special ACC operation/investigation" (as defined in s 4(1)) to the person specified in the notice to produce documents relevant In his reasons for judgment delivered on 19 December 2007 in a related Federal Court proceeding, Emmett J recorded that the ACC accepted that the ACC Act does not abrogate the right or duty of a recipient of a s 29 notice to claim legal professional privilege on behalf of a person (whether the recipient of the notice or a third party) who holds the privilege2. The litigation which has reached this Court has been conducted on that footing. It also appears to have been accepted that the powers of the ACC would not extend to the use or dissemination of documents to the content of which the privilege attached, and that such use or dissemination might be restrained by injunction. The institution of the Federal Court proceeding The Federal Court proceeding which has given rise to this appeal was commenced on 23 February 2006 by application made by Mr Anthony Stewart and filed as NSD 373 of 20063. Mr Stewart is an adviser to Mr Hogan who gave instructions to, and received advice from, the Accountants on behalf of 1 See Hogan v Koala Dundee Pty Ltd (1988) 20 FCR 314; Pacific Dunlop Ltd v Hogan (1989) 23 FCR 553. 2 MM v Australian Crime Commission (2007) 244 ALR 452 at 459. 3 When the proceeding was commenced, Mr Stewart was referred to by the pseudonym "A3". Mr Hogan. By his application Mr Stewart sought, inter alia, to restrain the ACC and the second respondent, the Chief Executive Officer of the ACC, from using or disseminating those documents produced by the Accountants to the ACC over which Mr Stewart claimed legal professional privilege on Mr Hogan's behalf. The jurisdiction of the Federal Court was conferred by both s 39B(1) and par (c) of s 39B(1A) of the Judiciary Act 1903 (Cth) as an injunction was sought against an officer or officers of the Commonwealth, in a matter arising under a federal law, the ACC Act. In response the ACC contended that the documents were not brought into existence for the dominant purpose of requesting or providing legal advice and that, in any event, the documents were made in furtherance of a crime or fraud such that no privilege existed4. On 11 May 2006 Mr Hogan was joined as the second applicant in the proceeding5. On 21 July 2006 Emmett J held that prima facie, and with minor exceptions, the documents in dispute were subject to legal professional privilege enjoyed by Mr Hogan6. On 17 November 2006 a further amended application was filed in which Mr Stewart was no longer named as an applicant in addition to Mr Hogan7. Mr Hogan continued his claim for relief to protect those documents in the ACC's possession in respect of which he asserted privilege. The ACC maintained its submission that the crime or fraud exception applied. The section 50 orders Emmett J made a number of orders in reliance upon s 50 of the Federal Court of Australia Act 1976 (Cth) ("the Federal Court Act"). As it then stood8 s 50 stated: "The Court may, at any time during or after the hearing of a proceeding in the Court, make such order forbidding or restricting the publication of 4 See R v Cox and Railton (1884) 14 QBD 153 at 165, 175; Cross on Evidence, 8th Aust ed (2010) at 910-913 [25290]. 5 Mr Hogan was at this stage referred to by the pseudonym "P". 6 A3 v Australian Crime Commission (No 2) (2006) 63 ATR 348. 7 See Hogan v Australian Crime Commission (No 4) (2008) 72 ATR 107 at 116. 8 Section 50 has since been amended by the Federal Court of Australia Amendment (Criminal Jurisdiction) Act 2009 (Cth), but not in a manner presently material. particular evidence, or the name of a party or witness, as appears to the Court to be necessary in order to prevent prejudice to the administration of justice or the security of the Commonwealth." Two points respecting s 50 should be made immediately. The first is that s 50 qualifies the general provision in s 17(1) of the Federal Court Act that the jurisdiction of the Federal Court is to be exercised in open court. The second concerns the phrase "the administration of justice". In reading what follows in these reasons it should be borne in mind that, to adapt remarks of Mason CJ in R v Rogerson9, in no sense does the ACC administer justice; that duty was entrusted relevantly to the Federal Court. The s 50 orders made by Emmett J variously prohibited publication of the name and address of both Mr Hogan and Mr Stewart, affidavits and exhibits thereto, and the reasons for judgment delivered by Emmett J on 21 July 2006. Some of those orders were sought by Mr Hogan, and others were sought by the ACC. In each case, the party not seeking the s 50 order either supported or, at the least, did not oppose the making of the order. Those orders were made because each of the parties, for his or its own reasons, desired that details of, and much of the evidence in, the proceeding not be made publicly available. The ACC desired to keep secret the result of the exercise of its powers of investigation under the ACC Act, and Mr Hogan his identity and financial affairs. The discovery application On 8 June 2007 Mr Hogan sought orders that the ACC provide discovery in relation to its case that the crime or fraud exception to privilege applied. On 9 August 2007, Mr Hogan filed an amended motion to that effect and Emmett J ordered the ACC to conduct enquiries and produce a list of documents concerning the inferences said to support the crime or fraud exception. The list was produced by the ACC and supplied to Mr Hogan, as later explained in these reasons. In response, Mr Hogan filed a motion on 7 December 2007 seeking from the ACC further and better discovery with respect to its case that the crime or (1992) 174 CLR 268 at 276-277; [1992] HCA 25. See also at 283 per Brennan and Toohey JJ, 293-294 per Deane J, 303 per McHugh J. fraud exception applied. This application was heard by Emmett J on 19 May In support of Mr Hogan's discovery application his solicitor, Mr David Peter Rydon, affirmed an affidavit on 13 February 2008. The affidavit of Mr Rydon was read in court by Mr Hogan's counsel on 19 May 2008 at the hearing of the application and thereby became evidence in the proceeding. Emmett J had been provided with a copy of Mr Rydon's affidavit in advance, and allowed it to be filed in court at the hearing. The exhibit to Mr Rydon's affidavit, exhibit DPR-1, contained material divided into a number of parts. Of critical importance in this appeal are the documents behind tabs C and E ("the parts C and E documents"). It was upon these documents that the argument in this Court was focused. Two points should be made immediately with respect to the parts C and E documents. First, they were not among the documents in respect of which the contested claim of legal professional privilege was made by Mr Hogan. Secondly, they were put in evidence by Mr Hogan as a step in support of his case that the privilege was not, as the ACC contended, defeated by the crime or fraud exception. The part C document in exhibit DPR-1 was referred to in the proceeding as "the Inference Schedule". The Inference Schedule had been produced by the ACC pursuant to orders made by Emmett J on 19 December 2006. Order 1 made on that day required the respondents to "file and serve a schedule identifying the inferences the respondents will contend at the hearing of this matter can be drawn from the evidence on which they rely". The Inference Schedule sought to detail the inferences that could be drawn, as to the alleged involvement of Mr Hogan in tax evasion schemes, from documents in the ACC's possession. The Inference Schedule had been served on Mr Hogan on 8 February 2007, but was not then filed. However, it formed part of exhibit DPR-1 to Mr Rydon's affidavit, which was ultimately read in Mr Hogan's case and filed in court on 19 May 2008. The part E documents in exhibit DPR-1 comprise file notes and accounting advices, created by the Accountants, together with certain other communications, all of which concern Mr Hogan's taxation and financial affairs ("the Accounting Advices"); Mr Rydon, in assembling these materials, believed they were among the documents produced by the Accountants to the ACC in response to the s 29 notice. However, it is important to note that the case presented by Mr Hogan to this Court does not turn upon the protection of any legal professional privilege which might have attached to these documents; rather, it was submitted that there had been a failure by the Federal Court to protect the "confidentiality interest" of Mr Hogan. The section 50 order respecting the Inference Schedule and the Accounting Advices After reading Mr Rydon's affidavit at the hearing on 19 May 2008, counsel for Mr Hogan sought an order under s 50 in respect of parts of exhibit DPR-1. Counsel informed the Court that immediately prior to the hearing, counsel for the ACC indicated that the ACC now opposed the making of any further s 50 orders and indeed foreshadowed an application to vacate the existing s 50 orders. Counsel for Mr Hogan proposed the making of a s 50 order, limited until further order, so that the hearing of his client's discovery application could proceed without delay. He suggested that, should the ACC bring on its application for vacation of s 50 orders then existing, the Court could "revisit the question of confidentiality in globo". Counsel for the ACC did not oppose the making of that s 50 order. On 19 May 2008 Emmett J made an order under s 50 restricting the publication of the whole of the parts C and E documents, the whole of the documents behind tab A of exhibit DPR-1 and eleven pages behind tab D to the parties and their legal advisers. The order was not expressed as made until further order, but from the transcript preceding the making of the order this appears to have been the intention of the parties10. His Honour further ordered Mr Hogan to file any motion for orders under s 50 on or before 9 June 2008. At the hearing counsel for Mr Hogan relied upon the Inference Schedule to identify the ACC's allegations of crime or fraud in respect of which Mr Hogan sought further discovery, and the Accounting Advices to contradict the ACC's assertion that it had no documents or evidence which adversely affected those allegations. Mr Hogan's discovery application succeeded and Emmett J ordered the ACC to repeat the review process, in compliance with the orders made on 9 August 2007, by 1 July 2008. 10 See also P v Australian Crime Commission (2008) 250 ALR 66 at 79. Success on the privilege claim Then on 1 July 2008 the course of the litigation took a significant change in direction. The ACC abandoned its reliance on the crime or fraud exception to privilege and requested the Court to relist the proceeding. On 4 July 2008 orders were made by consent that, inter alia, the ACC return the privileged documents to Mr Hogan and destroy any information which was derived from or reproduced the contents of those documents. The consent orders made on 4 July 2008 also vacated orders made on 19 May 2008, which had imposed the further discovery obligations on the ACC. The orders made on 4 July 2008 vindicated Mr Hogan's claim with respect to the privileged documents and secured their return to him. The controversy as to whether Mr Hogan's claim to legal professional privilege could be properly maintained was resolved but the orders did not dismiss the proceeding. Mr Hogan's second further amended application was not dismissed until orders were made by consent on 19 January 2009. Those orders were the result of a judgment delivered by Emmett J in which he refused Mr Hogan's application for further relief that the ACC ensure that persons with knowledge of the privileged material no longer be involved in Operation Wickenby, or any similar investigation, and addressing the question of costs11. The next stages in the litigation It is the next stages of the proceeding which have led to the present appeal. On 15 July 2008 Mr Hogan filed a motion in which he moved for orders that, "notwithstanding the disposal of these proceedings", the orders made under s 50 remain in force in relation to the material and documents identified in an exhibit to an affidavit affirmed by Mr Rydon on 14 July 2008. That material included, of relevance to this appeal, the Inference Schedule and the Accounting Advices. For its part, on 24 July 2008 the ACC filed a motion seeking orders under s 50 restricting publication of certain affidavits not including Mr Rydon's affidavit. Then on 5 August 2008 the litigation took a further change in direction. The third respondents, Nationwide News Pty Limited ("News") and John Fairfax Publications Pty Limited ("Fairfax"), filed a motion seeking: (1) leave pursuant to O 46 r 6(3) of the Federal Court Rules to inspect the documents held by the 11 Hogan v Australian Crime Commission (No 4) (2008) 72 ATR 107. registry in relation to the proceeding; and (2) the vacation of all s 50 orders previously made. All three motions, those by Mr Hogan of 15 July 2008 and the ACC of 24 July 2008, and that of News and Fairfax, were heard by Emmett J on 20 August 2008. Section 59 of the Federal Court Act authorises the making by the Judges of Rules of Court relating to the practice and procedure to be followed in Registries of the Court. Order 46 of the Federal Court Rules is headed "Registries". Order 46 r 6(3), so far as material, states: "Except with the leave of the Court or a Judge, a person who is not a party to a proceeding must not inspect any of the following documents in the proceeding: (a) an affidavit". Rule 6(4) provides to the effect that a person not a party to a proceeding must not inspect any document in the proceeding where it is not otherwise specified in r 6. The application by News and Fairfax was filed in the principal proceeding No NSD 373 of 2006, but appears to have instituted a new "matter" in the sense of Ch III of the Constitution, being the controversy arising under s 59 of the Federal Court Act and respecting the grant of leave under O 46 r 6(3)12. The one proceeding may comprise a number of Ch III "matters"13. The application was dealt with on the apparent basis that the continued operation of any s 50 order respecting material News and Fairfax sought to inspect would lead the Court to refuse leave under O 46 r 6(3). Hence the focus upon s 50 in the reasons given in the Federal Court. On 21 August 2008, Emmett J made orders giving effect to his conclusions in relation to most of the material in dispute, but reserved his decision in relation to the Inference Schedule and the Accounting Advices. His Honour ordered that all s 50 orders previously made in the proceeding be vacated. His Honour also gave leave to News and Fairfax to inspect and copy specified documents, including Mr Rydon's affidavit of 13 February 2008 and exhibit DPR-1 thereto but not the Inference Schedule or the Accounting Advices. 12 Cf DJL v Central Authority (2000) 201 CLR 226 at 237 [13]; [2000] HCA 17. 13 Truth About Motorways Pty Ltd v Macquarie Infrastructure Investment Management Ltd (2000) 200 CLR 591 at 624 [87]; [2000] HCA 11. The Inference Schedule and the Accounting Advices were made the subject of a s 50 order until further order. His Honour published his reasons on 29 August 200814 and made further orders. Order 1 of those orders was amended by order of 12 February 2010 made by Emmett J after the hearing in this Court. The result has been to vacate all s 50 orders in the proceeding, and to extend leave, granted to News and Fairfax on 21 August 2008 under O 46 r 6(3) to inspect and copy documents, to the Inference Schedule and the Accounting Advices. It was from the vacation of the s 50 order made on 21 August 2008, restricting publication of the Inference Schedule and the Accounting Advices, that Mr Hogan sought leave to appeal to the Full Court of the Federal Court. The Full Court granted leave to appeal, but by majority (Moore and Jessup JJ; Gilmour J dissenting) dismissed the appeal on 19 June 200915. In this Court, Mr Hogan seeks relief which would have the effect of reinstating the s 50 order with respect to the Inference Schedule and the Accounting Advices and dismissing the O 46 r 6(3) application by News and Fairfax. The construction of s 50 It has been assumed, no doubt correctly, that an order made under s 50 of the Federal Court Act may be made until further order and, in any event, may be vacated if the continuation of the order no longer appears to the Court to be necessary in order to prevent prejudice to the administration of justice or the security of the Commonwealth. As a general proposition, a court remains in control of its interlocutory orders and a further order will be appropriate, for example, where new facts and circumstances appear or are discovered, which render unjust the enforcement of the existing order16. As it appears in s 50, "necessary" is a strong word. Hence the point made by Bowen CJ in Australian Broadcasting Commission v Parish17, that the 14 P v Australian Crime Commission (2008) 250 ALR 66. 15 Hogan v Australian Crime Commission (2009) 177 FCR 205. 16 See Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc (1981) 148 CLR 170 at 177-178; [1981] HCA 39. 17 (1980) 29 ALR 228 at 234. collocation of necessity to prevent prejudice to the administration of justice and necessity to prevent prejudice to the security of the Commonwealth "suggests Parliament was not dealing with trivialities". Further, as indicated earlier in these reasons: (a) s 50 is an example of a provision authorising the Federal Court to make orders for the exercise of its jurisdiction other than in open court as mandated by s 17(1); and (b) "the administration of justice" spoken of in s 50 is that involved in the exercise by the Federal Court of the judicial power of the Commonwealth; this is a more specific discipline than broader notions of the public interest. It is insufficient that the making or continuation of an order under s 50 appears to the Federal Court to be convenient, reasonable or sensible, or to serve some notion of the public interest, still less that, as the result of some "balancing exercise", the order appears to have one or more of those characteristics18. If it appears to the Federal Court, on the one hand, to be necessary to make a particular order forbidding or restricting the publication of particular evidence or the name of a party or witness, in order to prevent either species of prejudice identified in s 50, or, on the other hand, that that necessity no longer supports the continuation of such an order, then the power of the Federal Court under s 50 is enlivened. The appearance of the requisite necessity (or supervening cessation of it) having been demonstrated, the Court is to implement its conclusion by making or vacating the order. The expression in s 50 "may ... make such order" is to be understood in this sense. It may tend to distract attention from the particular terms of s 50 to describe the Federal Court as embarking upon the exercise of a "discretion" when entertaining an application under s 5019. Once the Court has reached the requisite stage of satisfaction, it would be a misreading of s 50 to treat it as empowering the Court nevertheless to refuse to make the order, or to leave in operation the now impugned order. It would, for example, be an odd construction of s 50 which supported the refusal of an order under s 50 notwithstanding that it 18 A statement by Fullerton J to like effect, with respect to the powers of the Supreme Court of New South Wales, was approved by Hodgson JA (Hislop and Latham JJ concurring) in Attorney-General (NSW) v Nationwide News Pty Ltd (2007) 73 NSWLR 635 at 641. 19 Dwyer v Calco Timbers Pty Ltd (2008) 234 CLR 124 at 138-139 [40]; [2008] HCA 13. appeared to the Court to be necessary to make an order to prevent prejudice to the security of the Commonwealth. The character of an appeal (on the assumption that leave is necessary under s 24(1A) of the Federal Court Act and is granted) will depend upon the construction of s 24 of that Act. This provides for jurisdiction to hear and determine appeals from orders20 and s 28 provides for the making of appropriate orders on appeal. The terse provisions in the Federal Court Act have given rise to difficulty21. It is sufficient for present purposes to say that on his appeal from the decision of Emmett J, Mr Hogan should have failed if the decision was correct. This is on the assumption, in favour of Mr Hogan as appellant, that the decision of Emmett J was more than an interlocutory decision on a matter of practice or procedure. Appellate intervention in matters of practice or procedure, where no questions of general principle are at stake, has been said to require the exercise of particular caution22. The reasons of Emmett J of 29 August 2008 Emmett J identified the critical question as whether, once the Inference Schedule and the Accounting Advices had been introduced by Mr Hogan into evidence, the administration of justice that this material not be made available to the public. In that regard, it was significant that Mr Hogan had not adduced evidence of any specific prejudice that would or might flow from disclosure of that material. it remained necessary to prevent prejudice in order His Honour said23: "I do not consider that the applicant has established that it was only because of the expectation that s 50 orders would continue in perpetuity that the other material in question was tendered. It would be fair to 20 See the definition of "judgment" in s 4. 21 See, for example, R v Hillier (2007) 228 CLR 618 at 627-628 [15]-[16]; [2007] HCA 13. 22 Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc (1981) 148 CLR 170; Australian Broadcasting Corporation v O'Neill (2006) 227 CLR 57 at 78 [53]; [2006] HCA 46. 23 (2008) 250 ALR 66 at 80. conclude that the applicant's decision to adduce evidence was driven by the object of succeeding in his application against the [ACC]. It is difficult to see how the proceeding could have been prosecuted otherwise than by tender of the material in question. In the absence of the material, it would have been well nigh impossible for the court to understand what the issue was. The court directed the [ACC] to particularise its assertion that there were reasonable grounds for believing that the privileged documents in dispute had been brought into existence in the furtherance of a fraud or commission of an offence. There is no evidence to suggest that the [ACC] was motivated by bad faith of some sort." The Full Court In his dissenting reasons in the Full Court, Gilmour J considered that while Emmett J had correctly identified the relevant principles, he had erred in rejecting matters relevant to the exercise of the power to vacate the s 50 order in question24. In particular, Gilmour J said25: "The legitimate interest of the public in the full disclosure of the evidence tendered by the appellant on that day is, in my opinion, in these circumstances, marginal and of little weight when set against the potentially highly damaging release of inferences said by the [ACC] to arise going to alleged criminal conduct on the part of the appellant but in the absence of any charges laid against him as well as the intrusion into the confidential financial affairs of the appellant by the release of detailed private financial and taxation advices prepared by the Accountants." In the Full Court, and again in this Court, Mr Hogan submitted that Emmett J had failed to recognise what was said to be "the inherently confidential nature" of the Inference Schedule and the Accounting Advices. In rejecting this submission, Jessup J, with whom Moore J agreed generally, noted that Mr Hogan was not relying here on legal professional privilege and continued26: "How, then, does the applicant assert that the contentious documents were, and remain, inherently confidential? It is true that, 24 (2009) 177 FCR 205 at 238. 25 (2009) 177 FCR 205 at 237. 26 (2009) 177 FCR 205 at 220-221. generally speaking, every person has a right to keep from the view of others, or of the world at large, documents and things which he or she regards as his or her private concern. But so to propose is no more, in my view, than to state a conclusion about the absence of a right in any other person to view such documents and things. There are, of course, all manner of situations in which a claim to keep a particular document confidential will be recognised by a court. For example, equity recognises that the information contained in certain documents is, of its nature and by reason of the circumstances of its communication, subject to a duty of confidence. So too will the law protect trade secrets in well-recognised situations. And it is commonly the case that the court will protect from the public eye personal or commercial information the value of which as an asset would be seriously compromised by disclosure. In this latter category, the source of the jurisdiction (in this court) to provide such protection is s 50 itself. That is to say, the question will always be: is an order necessary to prevent prejudice to the administration of justice? Absent an affirmative answer to this question it is, in my view, almost meaningless to propose that documents themselves are, or that the information in them is, inherently confidential to an extent justifying, or assisting in the justification of, the making of an order permanently protecting them from public view." We agree with what his Honour said in that passage. Conclusions Leave of the Federal Court for News and Fairfax to inspect the Inference Schedule and the Accounting Advices should not be given if there remains in force an order made under s 50 which forbids or relevantly restricts their publication. In the absence of such an order, the question in such a case would be whether in circumstances where the evidence was tendered by a particular party that party might successfully oppose the making of an order under O 46 r 6(3) for inspection, upon the ground that the evidence contained material of a personal or private nature. Emmett J distinguished the situation respecting material on the file of the Court but not tendered and admitted into evidence, and said that the interests of open justice were not engaged there and that leave under O 46 r 6(3) should not be granted in such a case27. His Honour was correct in that conclusion. 27 (2008) 250 ALR 66 at 70. However, if the file material has been admitted into evidence the interests of open justice are engaged. Where, as here, the party in question adduces no evidence of apprehended particular or specific harm or damage, particularly by disclosure of the Accounting Advices as Emmett J noted28, leave properly will be granted under O 46 r 6(3). However, there should be a different outcome where a relevant s 50 order remains in force or should not have been vacated. The administration of justice by the Federal Court, which is the focus of s 50, certainly includes not only the generally recognised interest in open justice openly arrived at29 which is reinforced by the terms of s 17(1), but also restraints upon disclosure where this would prejudice the proper exercise of its adjudicative function. Bowen CJ pointed this out in Australian Broadcasting Commission v Parish30. His Honour went on to describe the litigation in Parish as analogous to a case where confidential information "is the subject-matter of the proceedings"; he concluded that it was in the interests of justice that the processes for determination of those very proceedings not destroy or seriously depreciate the value of that subject matter31. That is not this case. Nor, contrary to the appellant's submissions, does it provide a fairly close analogy to this case. The placing of material in evidence, even on the faith of what for the time being would be a restriction imposed by a s 50 order, is a matter of forensic decision. The price of such a decision may be the subsequent disclosure, as is often the case in litigation, of embarrassing publicity32. It is no sufficient answer to brandish the term "inherently confidential", and rely upon the assumptions in favour of Mr Hogan made without an evidentiary basis. 28 (2008) 250 ALR 66 at 79. 29 See K-Generation Pty Ltd v Liquor Licensing Court (2009) 237 CLR 501 at 520-521 [49]; [2009] HCA 4. 30 (1980) 29 ALR 228 at 233. 31 (1980) 29 ALR 228 at 235. 32 See Herald & Weekly Times Ltd v Williams (2003) 130 FCR 435 at 444. The decision of Emmett J was correct and the appeal to the Full Court properly failed. Orders The appeal should be dismissed. The appellant should pay the costs of the third respondents, News and Fairfax. The first and second respondents, the ACC and its Chief Executive Officer, were represented by the Commonwealth Solicitor-General, whose submissions were somewhat balanced between those of the other contestants. We would make no order for the costs of the first and second respondents.

HIGH COURT OF AUSTRALIA AND THE QUEEN RESPONDENT York v The Queen [2005] HCA 60 6 October 2005 ORDER Appeal allowed. Set aside the orders of the Court of Appeal of the Supreme Court of Queensland made on 8 October 2004 and in their place order that the appeal to that Court be dismissed. On appeal from the Supreme Court of Queensland Representation: B W Walker SC with A J Kimmins for the appellant (instructed by Ryan & Bosscher Lawyers) M J Copley for the respondent (instructed by Director of Public Prosecutions (Queensland)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS York v The Queen Criminal law – Sentencing – Appellant pleaded guilty to serious drug offences – Appellant cooperated with prosecuting authorities to secure murder conviction – Evidence that the appellant's life would be endangered in prison – Appellant sentenced at first instance to a wholly suspended term of imprisonment because of that risk – Attorney-General's appeal alleging the sentence was manifestly inadequate – Court of Appeal re-sentenced the appellant to serve a term of actual imprisonment – Whether appropriate to wholly suspend sentence – Whether sentencing judge entitled to take into account risk to appellant's safety whilst serving a term of imprisonment. Criminal Code (Q), ss 669A(1), 671B Penalties and Sentences Act 1992 (Q), s 9 Criminal Code (WA), s 689(3) Words and Phrases – "unfettered discretion". GLEESON CJ. On a Crown appeal, the Court of Appeal of Queensland, by majority (Williams JA and Cullinane J, White J dissenting) and "[n]ot without serious hesitation", intervened in an exercise of sentencing discretion by Atkinson J. The primary judge, in what she described as a "most unusual case" sentenced the appellant to imprisonment for five years and suspended the sentence. She added: "You must know, Ms York, that if you offend at all during those five years you will come back before me for sentencing, and I will have no compunction in sentencing you to serve that five years' imprisonment." What made the case so unusual, in the opinion of Atkinson J, was the nature and extent of assistance to the authorities given by the appellant. That assistance had resulted in the conviction of a man "for a very brutal execution style murder". The conduct of the appellant was described as "very brave". There had been resulting threats to kill the appellant, who was evidently in serious danger both inside and outside prison. Atkinson J said that imprisonment involved "a very high risk of extreme retributive violence". Even so, she also made it clear that, in the event of any further offending by the appellant, she would have "no compunction" in sending the appellant to prison. It is common sentencing practice to extend leniency, sometimes very substantial leniency, to an offender who has assisted the authorities, and, in so doing, to take account of any threat to the offender's safety, the conditions under which the offender will have to serve a sentence in order to reduce the risk of reprisals, and the steps that will need to be taken to protect the offender when released. The relevant principles are discussed, for example, in R v Cartwright1 and R v Gallagher2. Atkinson J gave the appellant credit for her assistance to the authorities, her early plea of guilty, and other personal factors of no present relevance, in a combination of two ways. She imposed a lesser term of imprisonment than would otherwise have been the case (but not lesser to an extent that she considered would of itself fully recognise such factors), and she suspended the sentence. Her reasoning made it clear that, if she had not suspended the sentence, she would have fixed a shorter term of imprisonment. There was a Crown appeal, but not on the ground that Atkinson J's reasoning process involved any error of principle. The sole ground of appeal was that the sentence was manifestly inadequate. It was common ground in the Court of Appeal, and in this Court, that the principles governing appellate intervention under s 669A(1) of the Criminal Code (Q) (notwithstanding the reference in that (1989) 17 NSWLR 243. (1991) 23 NSWLR 220. section to "unfettered discretion") were as stated in House v The King3 and Dinsdale v The Queen4. In the Court of Appeal, the proceedings took an unusual turn. The Court of Appeal, over the objection of the present appellant, received evidence, which had not been before Atkinson J, from a departmental officer, concerning the practical capacity of the authorities to protect the appellant from danger in prison. It is one thing for a court to hear evidence of the circumstances in which a person will serve a term of imprisonment, perhaps involving close protection and isolation, in order to take that into account in fixing a sentence of an appropriate length5. It is another thing to set out to investigate the executive government's capacity to discharge its obligations of taking proper care of people in its custody. It may be added that, if A threatens to kill B, or to arrange for B to be killed, an enquiry into A's prospects of carrying out that threat is, in most cases, unlikely to lead to a clear conclusion. The factors most relevant to the question are unlikely to be the subject of reliable evidence. Atkinson J did not go beyond finding that there was a "very high risk". An attempt, on appeal, to measure the extent of the risk was bound to fail. For some offenders, prisons are dangerous places. It is the responsibility of the executive branch of government, in whose custody prisoners are placed, to take reasonable steps to minimise the danger. In dealing with questions of sentence, a court may need to know of any special circumstances of confinement that will be involved. But it is difficult for a court to measure the prospects of success of a criminal enterprise. In the result, the further evidence was found to be unsatisfactory. The Court of Appeal did not overrule Atkinson J's finding as to risk. The majority in the Court of Appeal said that threats of criminal activity "cannot justify the court in refusing to send a criminal to jail where that is the only appropriate penalty available under our law". That is correct6. Nothing that was said by Atkinson J, or by White J, was to any different effect. The question was whether a custodial sentence, without suspension, was the only appropriate penalty. The majority said, without further elaboration: "Not without serious hesitation we have come to the conclusion that the offences committed by the [appellant] are so serious that, notwithstanding her co-operation with the authorities, her plea of guilty, and the threats directed at her by other criminals she should serve a term of actual imprisonment." (1936) 55 CLR 499. (2000) 202 CLR 321 at 324-325 [3], 329 [21], 339 [57]-[58]. 5 See, for example, Burchell (1987) 34 A Crim R 148 at 151. 6 R v Gooley (1996) 66 SASR 380 at 382-383. The Court of Appeal sentenced the appellant to five years imprisonment to be suspended after two years. It is true that a conclusion that a sentence is manifestly inadequate may not be susceptible of much elaboration7. Even so, having regard to the very unusual circumstances of the case, and the detailed reasons for her decision given by Atkinson J, the bare statement of a conclusion by the majority in the Court of Appeal is not persuasive. It may be that there was a concern that Atkinson J had been in some way overborne by the threats of criminal harm to the appellant; a concern perhaps reflected in the course of proceedings in the Court of Appeal. That, however, overlooks her concluding statement that she would have no compunction in sending the appellant to prison in the event of any re-offending during the period of suspension. Having regard to the appellant's previous history, including a history of involvement with drugs, that is no mere theoretical possibility. For a number of reasons, she is likely to be the subject of police attention. An assumption that, for her, a suspended sentence is the equivalent of no punishment at all would be quite unwarranted. I would allow the appeal, set aside the orders of the Court of Appeal, and, in place of those orders, order that the appeal to that Court be dismissed. cf Dinsdale v The Queen (2000) 202 CLR 321 at 325-326 [6]-[7]. McHugh 10 McHUGH J. This appeal presents the issue: whether, in sentencing a convicted person, a judge is entitled to take into account that, if the prisoner is imprisoned, there is a grave risk that fellow prisoners will kill the convicted person while he or she is in custody? If it is a relevant consideration, as I think it is, then the Queensland Court of Appeal erred in finding that the sentence that the trial judge imposed on the appellant in this case was manifestly inadequate. Statement of the case The appellant, Mrs Gloria Jeanette York, pleaded guilty in the Supreme Court of Queensland to one count of trafficking in a dangerous drug, two counts of possessing a dangerous drug and one count of possessing a dangerous drug in excess of 500 grams. The Crown accepted her guilty pleas on these counts in full discharge of the indictment, which also charged her with a number of counts of supplying dangerous drugs. The primary judge, Atkinson J, sentenced Mrs York to five years imprisonment, but wholly suspended that sentence for a period of five years. Her Honour said that: "[a]bsent any other factors I would have thought that a head sentence of 10 to 12 years would be the sentence that would be imposed for offending of this type." Atkinson J held that other factors existed and that it was appropriate to discount this notional sentence by sixty percent. First, Mrs York had not re-offended since her arrest in April 2001. Second, and "more importantly", Mrs York had given the police and the Court assistance in prosecuting "a major drug dealer", Mr Lace, for "an execution style murder". Her Honour said: "[i]t is very unusual for someone in your position to give that level of assistance to the police and to the Court. Acting Detective Inspector Binney says that your assistance continued after Lace was charged, and at no time did you falter or waver despite the continuance of threats made against both you and family members." Her Honour also took into account an affidavit from Mr Michael Bosscher, the appellant's solicitor. That affidavit detailed information that Mr Bosscher had been given by Mr Rob Wildin, a member of the Intelligence Unit in the Department of Corrective Services. The affidavit stated: "6. Mr Wildin informed me, and I verily believe, that the conclusions of the report [the intelligence assessment report] state that Gloria York will be at significant risk should she be detained in the Brisbane Women's Correctional Centre. 7. Mr Wildin further informed me, and I verily believe, that the report he has provided to his superiors contains the following information – (a) Mrs York has and will continue to be subject to threats; McHugh That the Department's assessment is that the threats are genuine; That they have had information in the past that Mr Lace has contacted female associates at the Brisbane Women's Correctional Centre with the intent that they inflict harm upon Gloria York should she be incarcerated at that location; and That it is believed Mr Lace will again endeavour to secure these arrangements with female associates in the Brisbane Women's Correctional Centre." On this evidence, Atkinson J formed the "belief ... that if [the appellant] were to be imprisoned [she] would face the very real danger of being killed." Atkinson J held "that a head sentence of four years would not adequately reflect the seriousness of the offences that [the appellant had] committed." Accordingly, the judge imposed a head sentence of five years. Then, the "further discount" was incorporated into an "ameliorating order made on that head sentence", which also took account of the appellant's "early plea of guilty" and the appellant's personal factors. For those reasons, Atkinson J held that: "[t]he strongest deterrence that I can think of is to impose five years' imprisonment upon you and to wholly suspend that for a period of five years." Acting under s 669A(1)(a) of the Criminal Code (Q) ("the Code"), the Attorney-General appealed against the sentence on the ground that it was manifestly inadequate. On the hearing of that appeal, the Court of Appeal, acting under s 671B of the Code: "took the very unusual step of adjourning the hearing 'to give the appellant Attorney-General the opportunity of placing before the Court material from Corrective Services indicating the administrative arrangements that would be made if the Court determined that the respondent should serve an actual period in custody.'" The Attorney-General then placed before the Court a letter from Mr Noel Taylor, the Acting Executive Director of Custodial Corrections, that stated: "In Ms York's case (if sentenced to imprisonment) such management processes that may be considered are the placement of the prisoner in a protection unit at the Brisbane Women's Correctional Centre or the accommodation of the prisoner at Townsville. McHugh If sentenced to a period of imprisonment the Department will develop a management plan for Ms York which will focus on her safety and security." The majority of the Court of Appeal (Williams JA and Cullinane J) "formed the view that Taylor failed to appreciate the seriousness of the issue with which the court was concerned and about which it was seeking some assistance from him." The majority said: "[b]ecause of what has been learnt through trials associated with those murders [which have taken place within Queensland Correctional Centres in recent years] some judges of this court have very real concerns about the capacity of Corrective Services to deal with the kind of situation presented by the threats against the respondent. The failure of Taylor to address those issues has only heightened this court's concerns about those matters." Despite these concerns, the majority (White J dissenting) came "to the conclusion that the offences committed by the respondent are so serious that, notwithstanding her co-operation with the authorities, her plea of guilty, and the threats directed at her by other criminals she should serve a term of actual imprisonment." The majority said: "Once this Court accepts that the risk to a criminal's safety whilst in prison was such that the otherwise appropriate penalty, namely imprisonment, ought not be imposed then the whole of the criminal justice system which operates in our society would be undermined. This court cannot bow to pressure from criminals. In our society imprisonment is the method of punishment primarily imposed for serious criminal offences. Judges must be able, however, to have confidence that those administering the prisons will ensure the physical safety of those persons placed in their responsibility." The Court of Appeal upheld the Attorney's appeal on the ground that the sentence imposed at first instance was manifestly inadequate. It set aside the sentence that Atkinson J imposed and sentenced Mrs York to five years imprisonment to be suspended after serving two years with an operational period of five years. The safety of the prisoner is a relevant sentencing consideration With great respect, the Court of Appeal erred in finding that "the risk to a criminal's safety whilst in prison" was not a consideration that was relevant to whether "the otherwise appropriate penalty, namely imprisonment, ought not be imposed". In fixing an "appropriate penalty", a sentencing judge is entitled to take into account any matter that ensures that, to some extent, the fixing of the McHugh sentence "discharge[s] the true function of the criminal law and the purposes of punishment"8 in the instant case. The common law's conception of the "purposes of punishment" is settled. Sentences are imposed to further "the public interest"9 – which may include the rehabilitation of the prisoner – and to enhance the liberty of society by ensuring "the protection of society"10 from the risk of a convicted criminal re-offending11 or others engaging in similar criminal activity12. The common law's conception of liberty is not limited to "liberty in a negative sense", that is, "the absence of interference by others"13. It extends to a conception of liberty in a "positive" sense, which is "exemplified by the condition of citizenship in a free society, a condition under which each is properly safeguarded by the law against the predations of others."14 Thus, sentencing judges must impose sentences that are apt, not merely to prevent a convicted criminal from interfering with others, but also to enable the prisoner's rehabilitation so as to resume citizenship in the free society15. They must seek to ensure that each and every citizen, including a convicted criminal, "is properly safeguarded by the law against the predations of others."16 That means that a sentencing judge must endeavour not only to protect society from the risk of a convicted criminal re-offending but also to protect the convicted criminal from the risk of other prisoners re-offending while in jail. 8 Leach (1979) 1 A Crim R 320 at 327. 9 Ball (1951) 35 Cr App R 164 at 165. 10 Veen v The Queen [No 2] (1988) 164 CLR 465; Leach (1979) 1 A Crim R 320 at 327; R v Jackway; Ex parte Attorney-General [1997] 2 Qd R 277. 11 R v Morris (1958) 76 WN (NSW) 40; R v Radich [1954] NZLR 86. 12 R v McCowan [1931] St R Qd 149; R v Skeates [1978] Qd R 85; R v McGlynn [1981] Qd R 526; R v Radich [1954] NZLR 86. 13 Braithwaite and Pettit, Not Just Deserts: A Republican Theory of Criminal Justice, 14 Braithwaite and Pettit, Not Just Deserts: A Republican Theory of Criminal Justice, 15 Duncan v The Queen (1983) 47 ALR 746; Bell (1981) 5 A Crim R 347 at 351-352. 16 Braithwaite and Pettit, Not Just Deserts: A Republican Theory of Criminal Justice, McHugh The common law's equal concern for the physical safety of each citizen makes it appropriate for a sentencing judge to take into account the grave risk that a convicted criminal could be killed while in jail. What weight should be given to the risk of a prisoner being killed or injured will depend on all the circumstances of the case including the likelihood of its occurrence. The Attorney-General's appeal was brought under s 669A(1) of the Code. That section provides that the Attorney-General may appeal to the Court of Appeal against any sentence pronounced by the court of trial or a court of summary jurisdiction in a case where an indictable offence is dealt with summarily by that court. Section 669A(1) declares that "the Court may in its unfettered discretion vary the sentence and impose such sentence as to the Court seems proper." The section's declaration that the Court of Appeal has an unfettered discretion to vary the sentence indicates that the Court may allow an appeal for any reason that the Court thinks proper. In particular, it indicates that the Court of Appeal is not required to find error on the part of the trial court or the court of summary jurisdiction or that the sentence is "manifestly inadequate" before it interferes with a sentence imposed by those courts. This construction appears plain on the face of the section. But the history of s 669A(1) puts it beyond doubt. Section 669A(1) was inserted in the Code in 1939. At that time it did not contain the term "unfettered". That was added in 1975 as the result of the decision of the Court of Criminal Appeal of Queensland in R v Liekefett; Ex parte Attorney-General17. In Liekefett, the Court of Criminal Appeal held18 that an appeal by the Attorney-General under s 669A(1) was an appeal against a discretionary judgment and should be dealt with in accordance with the principles referred to in House v The King19. Two years later, the Queensland legislature amended the section by adding the term "unfettered" in front of the term "discretion". In the Second Reading Speech for the Bill introducing the "The Bill is being amended to make it clear that the Court of Criminal Appeal has an unfettered discretion to determine the proper sentence to impose when the Attorney-General has appealed against the inadequacy of the sentence. The private legal profession is opposed to this amendment. 17 [1973] Qd R 355. 18 [1973] Qd R 355 at 366. 19 (1936) 55 CLR 499. 20 Queensland, Legislative Assembly, Parliamentary Debates (Hansard), 23 April McHugh I do not propose to alter this amendment because it only makes clear what was always intended, and was in fact acted upon by the Court of Criminal Appeal for 30 years until 1973, when a court decision effectively changed the law to what was not intended." In the light of the decision in Liekefett21, the Second Reading Speech on the amending Bill and the words "unfettered discretion", I find it impossible to conclude that, in an appeal under s 669A(1), the Attorney-General must demonstrate error on the part of the trial court or the court of summary jurisdiction that satisfies the requirements laid down in House v The King. Yet in R v Melano; Ex parte Attorney-General22, the Court of Appeal held that except "perhaps, in exceptional circumstances", the Attorney had to demonstrate error, in accordance with the principles laid down in House v The King, before an appeal under s 669A(1) could succeed. With great respect, this cannot be correct. It was because the Court of Criminal Appeal in Liekefett had held that the House v The King principles applied to s 669A(1) that the Legislature intervened to declare that the Court's discretion was not shackled by those principles. The words "may ... vary the sentence" indicate that the Attorney-General's appeal is not by way of rehearing. But the term "unfettered" must mean that, subject to any statutory direction, the Court can interfere with the sentence for any reason that it thinks is sufficient, so long as the reason is not an arbitrary one. The discretion is to be exercised by a court and must be exercised judicially in accordance with the broad principles laid down by Lord Halsbury LC in Sharp v Wakefield23. This seems to have been the view of Macrossan J in R v Osmond; Ex parte Attorney-General24 who thought that, "in the absence of good reason, to interfere with the decision below", the Court would not uphold an appeal under the section. Nothing in this Court's decision in Dinsdale v The Queen25 supports a contrary conclusion. The appeal provision considered in that case26 empowered the Court of Criminal Appeal of Western Australia "if they think that a different sentence should have been passed" to quash the sentence "and pass such other 21 [1973] Qd R 355. 22 [1995] 2 Qd R 186 at 189-190. 23 [1891] AC 173 at 179. 24 [1987] 1 Qd R 429 at 437. 25 (2000) 202 CLR 321. 26 Section 689(3) of the Criminal Code (WA). McHugh sentence warranted in law". In Dinsdale, the Court held that, before exercising the power conferred, the Court of Criminal Appeal must find error on the part of the sentencing judge before setting aside the primary sentence. But the statutory provision considered in Dinsdale did not contain the term "unfettered". Nor did it have the legislative and judicial history that s 669A has had. In my view, Dinsdale provides no assistance in construing s 669A(1). However, counsel for the Crown expressly accepted in the Court of Appeal and in this Court that the Attorney-General's appeal against the sentence imposed by Atkinson J could not succeed unless he established error in accordance with the principles laid down in House v The King. But, so counsel argued, the Court of Appeal correctly set aside the sentence of Atkinson J because the sentence was manifestly inadequate, a ground that constitutes error for the purpose of the House v The King principles. Given the findings of fact made by Atkinson J, the sentence that she imposed could not be said to be manifestly inadequate. It could not be manifestly inadequate if the likelihood of injury to the prisoner was a relevant consideration. Nonetheless, despite the concession by counsel for the Crown that he had to establish House v The King error, I would not have favoured allowing the appeal had I not concluded that the Court of Appeal itself had made an error of principle. Absent error, the unfettered discretion of the Court of Appeal is so wide that a sufficient ground for varying the sentence is that the Court thinks it is inadequate. However, the Court of Appeal allowed the appeal because: "We are conscious of the fact that the learned sentencing judge and Justice White, both experienced judges, have concluded that the risk to the respondent's safety in prison is so great that the court ought not impose the two to two and a half years imprisonment we have referred to above. Not without grave hesitation we have come to the conclusion that it would be wrong for this court to so conclude. Once this court accepts that the risk to a criminal's safety whilst in prison was such that the otherwise appropriate penalty, namely imprisonment, ought not be imposed then the whole of the criminal justice system which operates in our society would be undermined. This court cannot bow to pressure from criminals." As this passage shows, the Court of Appeal concluded that to take into account the threat to the safety of Mrs York would be "bow[ing] to pressure from criminals". To characterise the reasoning of the sentencing judge in this way was an error that has the result that the orders of the Court of Appeal cannot stand. The safety of Mrs York in prison was a matter that Atkinson J was entitled to take into account in determining what the sentence should be and whether it should be suspended. The fact that the threat to her safety arises from the activities of a criminal did not require the judge to disregard the threat. The duty of sentencing judges is to ensure, so far as they can, that they do not impose sentences that will bring about the death of or injury to the person sentenced. McHugh Where a threat exists – as it often does in the case of informers and sex offenders – recommendations that the sentence be served in protective custody will usually discharge the judge's duty. Here the learned sentencing judge concluded on persuasive evidence that no part of the Queensland prison system could be made safe for Mrs York. That created a dilemma for the sentencing judge. She had to balance the safety of Mrs York against the powerful indicators that her crimes required a custodial sentence. In wholly suspending Mrs York's sentence, Atkinson J appropriately balanced the relevant, even if conflicting, considerations of ensuring the sentence protected society from the risk of Mrs York re-offending and inflicting condign punishment on her on the one side and ensuring the sentence protected her from the risk of her fellow inmates committing serious offences against her on the other side. In suspending the sentence, the learned judge made no error of principle. Nor was the suspended sentence manifestly inadequate. The "unfettered" discretion of the Court of Appeal, therefore, miscarried. Ordinarily, that would require the matter to be remitted to the Court of Appeal to reconsider the matter. But given that the parties have conducted the case on the basis that the Attorney-General had to show a House v The King error on the part of the sentencing judge, the appropriate order is to allow the appeal and restore the orders of the sentencing judge. The Attorney-General has failed to demonstrate an error of that type and the Attorney should not be permitted now to conduct an appeal on the basis of what I think is the correct construction of s 669A(1). Since the conferral on the Crown of rights of appeal against sentences, appellate courts have been much influenced in their approach to such appeals by the principle of double jeopardy27. The sentence imposed on Mrs York was put in jeopardy by the appeal to the Court of Appeal. It should not be put in jeopardy once again by allowing the Attorney to conduct a further appeal on a basis that the Attorney has hitherto disclaimed. Order The appeal should be allowed. 27 Malvaso v The Queen (1989) 168 CLR 227 at 233-234; Everett v The Queen (1994) 181 CLR 295 at 305; R v Jermyn (1985) 2 NSWLR 194 at 204; Western Australia v Miller (2005) 30 WAR 38 at 41-42 [12]; Attorney-General (Tas) v McDonald (2002) 11 Tas R 221 at 227 [19]. Hayne HAYNE J. This appeal was argued by both sides on the footing that the principles governing appellate intervention by the Court of Appeal of Queensland under s 669A(1) of the Criminal Code (Q) were as stated in House v The King28 and Dinsdale v The Queen29. Whether the reference in that section, not found in the equivalent legislation of other jurisdictions, to "unfettered discretion" may permit or require some modification of those principles in appeals brought under s 669A(1) is not a question that was argued. I express no view about the question. The only question for the Court of Appeal raised by the sole ground of appeal to that Court was whether the sentence passed by the primary judge was manifestly inadequate. Yet it would appear from the reasons of the Court of Appeal that arguments were advanced alleging identifiable error in the primary judge's reasons. Thus the majority of the Court of Appeal (Williams JA and Cullinane J) concluded30 that the primary judge erred in not considering "as a separate issue" whether there was proper ground for not imposing the sentence otherwise determined to be appropriate "because of the risk to the [appellant's] safety whilst in prison". It appears, however, that this error was not treated by the majority as sufficient reason to reopen the sentencing discretion. Rather, the determinative question was treated as being that raised by the Notice of Appeal: was the sentence passed manifestly inadequate? On this issue the majority concluded31 "[n]ot without serious hesitation", that the offences committed by the appellant were so serious that "notwithstanding her co-operation with the authorities, her plea of guilty, and the threats directed at her by other criminals she should serve a term of actual imprisonment". As is recorded in the reasons of other members of this Court, the Court of Appeal received evidence about what could be or would be done to lessen or eliminate the risk of harm to the appellant were she to be imprisoned. Execution of sentences of imprisonment passed by the courts, and caring for prisoners under sentence, are tasks committed to the executive arm of government and regulated, for the most part, by legislation. For the reasons given by Gleeson CJ, any attempt to measure the extent of the risk of harm to the appellant in prison was an attempt that was bound to fail. And in the present matter, it was not argued in the Court of Appeal, or on appeal to this Court, that the primary judge's qualitative description of that risk as "very high" was wrong. In these circumstances the inquiries made by the Court of Appeal about what could be done to eliminate or 28 (1936) 55 CLR 499. 29 (2000) 202 CLR 321 at 324-325 [3], 329 [21]-[22], 339 [57]-[58]. 30 R v York; Ex parte Attorney-General of Queensland [2004] QCA 361 at [11]. 31 [2004] QCA 361 at [24]. Hayne reduce the risks the appellant faced in prison were irrelevant to, and a distraction from, the only issue that was raised by the Notice of Appeal in that Court: was the sentence passed manifestly inadequate? That the appellant faced a real risk of serious harm in prison was not a consideration irrelevant to deciding what sentence should be imposed upon her. The effect of serving a term of imprisonment, and the conditions under which an offender would serve that sentence, are relevant matters that may be taken into account by a sentencing judge – at least when that effect and those conditions are shown to be different from, and more onerous than, the effect on and conditions undergone by other prisoners32. And in this case, it was well open to the primary judge to conclude that the "very high" risk of physical harm to the offender in prison would not only affect the conditions under which she would serve a sentence but also be likely to lead to radically different consequences for the appellant from the consequences of imprisonment for other prisoners. The Court of Appeal's inquiries about the risks which the appellant faced served only to reinforce those conclusions, leading the majority of that Court to say that the relevant department of the executive "was not in a position to demonstrate … that it has the capacity to deal adequately with problems highlighted by this case"33. As noted earlier the majority of the Court of Appeal treated the question of risk of harm to the appellant as a matter relevant to sentence but as a matter to be considered only after first deciding what was otherwise a proper sentence to be imposed. This approach is erroneous. In the present matter, it caused the majority of the Court of Appeal to frame the relevant question34 as whether the Court should "bow to pressure from criminals". To that question only one answer can be given. But because their Honours approached the issue in the appeal in this way, their Honours first identified the "appropriate penalty" as being a term of actual imprisonment without having considered the effect of imprisonment on the appellant and the conditions under which the appellant would serve that term, and then decided whether those conditions constituted reason enough not to pass that sentence. That was not the issue presented for the Court's decision. That issue was, as pointed out earlier, only whether the sentence was manifestly inadequate, having regard to all of the matters that were properly to be taken into account in sentencing the appellant, including the effects on the appellant of imposing a custodial term and the conditions under which she would serve any term of imprisonment. 32 R v Perez-Vargas (1986) 8 NSWLR 559 at 565 per Street CJ; R v Rostom [1996] 2 VR 97 at 100, 102 per Charles JA; Laws (No 2) (2000) 116 A Crim R 70 at 78 per Wood CJ at CL; R v ZMN (2002) 4 VR 537. 33 [2004] QCA 361 at [22]. 34 [2004] QCA 361 at [21]. Hayne This Court has expressed reluctance to grant special leave to appeal against sentencing decisions35. One of the chief reasons given for that course is that it recognises the advantages which Courts of Appeal in the States have because of their knowledge of local conditions and local sentencing practices36. Those conditions and practices are important elements in deciding what is or is not a proper sentence. Ordinarily this would suggest that this Court should not interfere with the decision reached in the Court of Appeal about the adequacy of a sentence. In the present matter, however, the Court of Appeal was divided in opinion about the adequacy of the sentence passed at first instance. The majority having erred in the manner described earlier, I am not persuaded that it was shown that the sentence passed by the primary judge was manifestly inadequate and the appeal to the Court of Appeal should have been dismissed. It follows that the appeal to this Court should be allowed and consequential orders made in the form proposed by Gleeson CJ. 35 Colefax v The Queen [1962] ALR 399; Veen v The Queen (1979) 143 CLR 458 at 461 per Stephen J, 467 per Mason J, 497 per Aickin J; Neal v The Queen (1982) 149 CLR 305 at 309 per Gibbs CJ, 323 per Brennan J; Lowe v The Queen (1984) 154 CLR 606 at 608-609 per Gibbs CJ, 611 per Mason J, 620 per Brennan J, 621-622 per Dawson J; Radenkovic v The Queen (1990) 170 CLR 623 at 634-635 per Mason CJ and McHugh J, 640 per Dawson J, 646 per Toohey and Gaudron JJ. See also Postiglione v The Queen (1997) 189 CLR 295 at 337 per Kirby J; Ryan v The Queen (2001) 206 CLR 267 at 294 [89] per Kirby J. 36 Neal (1982) 149 CLR 305 at 309 per Gibbs CJ, 323 per Brennan J; Veen (1979) 143 CLR 458 at 497 per Aickin J. Issue The question in this case is whether the Court of Appeal of Queensland should have interfered with the exercise of a sentencing judge's discretion to suspend wholly a serious offender's term of imprisonment because of a grave risk of harm to the offender were she to be imprisoned. Facts On 11 April 2003, the appellant pleaded guilty to one count of trafficking in a dangerous drug, two counts of unlawful possession, and one count of unlawful possession of a dangerous drug in excess of 500 grams. The pleas were accepted in satisfaction of these and some other offences with which she had been charged. She came before the Supreme Court of Queensland (Atkinson J) for sentencing on 18 June 2004. At the sentencing hearing, the respondent adduced evidence of the assistance she had given to the respondent in the ultimately successful prosecution of a murderer. The killing had been effected as if it were an execution. An Acting Detective Inspector deposed to the appellant's unwavering assistance during the course of the committal, the trial and a re-trial of the offender in the face of serious and alarming threats to her own and her family's safety. The detail of the evidence of the threats is summarized later in this judgment. There was other, uncontradicted evidence on behalf of the appellant. Mr Bosscher, her solicitor, swore that he was informed by an officer in the Intelligence Unit within the Department of Corrective Services, Mr Wildin, that the appellant's life would be endangered if she were to be imprisoned in the Brisbane Women's Correctional Centre. The solicitor had also been informed by Mr Wildin that the latter had reported to his superiors that the appellant had been, and would continue to be subject to threats assessed as genuine by the Department, including that the convicted murderer had contacted the appellant, and would again try to arrange with female associates at the prison for the appellant to be harmed. Mr Wildin had added that any person who associated with the appellant at the prison would also be at risk from inmates there. Finally, Mr Wildin had informed Mr Bosscher that he should suggest to counsel for the appellant that he ask the sentencing judge to make the strongest possible recommendation that the appellant serve any term of imprisonment that might be imposed upon her in a northern correctional institution, preferably in Townsville. Not only did the respondent make no effort to contradict any of this evidence, but also it offered no argument that it was irrelevant or exaggerated. The sentencing judge (Atkinson J) accepted that the offences would ordinarily attract a long sentence of imprisonment. Her Honour referred to the appellant's serious criminal history. The offences, she noted, were committed in the course of the conduct of a well-organized criminal business. There was an additional aggravating factor to which she had regard, that the appellant was convicted while she was on bail on another charge. The sentencing judge was of the view that a head sentence of 10 to 12 years was appropriate, a view that came to be approved by all of the judges on appeal. The sentencing judge said however that the appellant's conduct in assisting the respondent in the investigation and conviction of the murderer displayed great courage; the level of assistance provided by the appellant to the police and to the criminal court was very unusual, she said, for someone in the appellant's position. There is no doubt that what the appellant did made a significant contribution towards bringing the murderer against whom she testified to justice. The sentencing judge's conclusion on the central factual matter, of the appropriate penalty, incarceration or otherwise, was that if the appellant were to be imprisoned, she would face a very real danger of being killed. Indeed, in the face of the evidence and its sources, which were not contradicted, she could hardly have held otherwise: she was bound therefore to take into account the very real risk of retributive violence against the appellant in prison. She also took into account the appellant's early plea of guilty. The sentencing judge considered whether there should be a discount from the head sentence: a discount of 60 per cent would, she thought, be too much. The seriousness of the offences required, and she therefore imposed, a head sentence of five years. Her Honour then wholly suspended the term of imprisonment for its operational period of five years. The Court of Appeal The respondent successfully appealed the Court of Appeal (Williams JA and Cullinane J, White J dissenting). It was recognized by all of their Honours that the evidence before the sentencing judge that the appellant would be at considerable risk while in custody, was clear and unchallenged. The majority pointed out that there had however been no evidence before the sentencing judge to support Mr Wildin's assertion that the risk to the appellant would be slighter if she were to be imprisoned in Townsville. The Court was concerned as to the absence of evidence on this and other matters from the respondent and adjourned the appeal to give the Attorney-General an opportunity of assembling and placing material before the Court37 from the Department of Corrective Services setting out the administrative arrangements that would be undertaken if the Court were to determine that the appellant should spend time in prison. This course was adopted despite objection by the appellant. Some material was then filed by the respondent. It consisted of a letter described as a report, written by the Acting Executive Director of Custodial Corrections, Mr Taylor supplemented by oral evidence that he was called to give. Williams JA and Cullinane J described the report as trite, and said, accurately, that Mr Taylor had not addressed the real issue at all, that his failure even to have read Mr Wildin's report showed scant regard for the very important issues raised by the Court, and that he had failed to appreciate the seriousness of the issue. White J denounced Mr Taylor's evidence as a failure, and a deliberate exercise in 37 See s 671B of the Criminal Code (Q) which relevantly provides: "671B(1) The Court may, if it thinks it necessary or expedient in the interests of justice – (a) order the production of any document, exhibit, or other thing connected with the proceedings; and (b) order any persons who would have been compellable witnesses at the trial to attend and be examined before the Court, whether they were or were not called at the trial, or order any such persons to be examined before any judge of the Court, or before any officer of the Court, or justice, or other person appointed by the Court for the purpose, and admit any depositions so taken as evidence; and (c) receive the evidence, if tendered, of any witness (including the appellant) who is a competent, but not a compellable, witness; and and exercise in relation to the proceedings of the Court any other powers which may for the time being be exercised by the Supreme Court on appeals or applications in civil matters, and issue any warrant or other process necessary for enforcing the orders or sentences of the Court. (2) However, in no case shall any sentence be increased by reason of or in consideration of any evidence that was not given at the trial. non-responsiveness. The majority concluded that his evidence really came down to the proposition that the appellant would probably be sent to the Townsville Women's Prison. The problem about that is that it is a mainstream women's prison without a protective custody section. We record at this point our concurrence with the criticisms made by the judges of the Court of Appeal. Indeed even stronger criticism might not be inappropriate. The report made no real effort to meet the concerns of the Court. The best that the Department was disposed to offer was the "[development of] a management plan [to] focus on her safety and security." It also emerged in cross- examination, that Mr Taylor had not even troubled to consult Mr Wildin before writing his report and giving evidence. Although they expressed serious misgivings about the attitude of the Department of Corrective Services, and said that they had grave concerns for the appellant's safety, the majority decided to uphold the respondent's appeal. In doing so, they said this38: "Looked at objectively in the light of the criminality of the [appellant's] offending, her criminal history, her co-operation with the authorities with respect to Lace, and the plea of guilty we are of the view that the [appellant] ought to have been sentenced to a term of imprisonment in the range of two to two and a half years." The particular matters that weighed with the majority are set out in this passage from the joint judgment39: "We are conscious of the fact that the learned sentencing judge and Justice White, both experienced judges, have concluded that the risk to the [appellant's] safety in prison is so great that the court ought not impose the two to two and a half years imprisonment we have referred to above. Not without grave hesitation we have come to the conclusion that it would be wrong for this court to so conclude. Once this court accepts that the risk to a criminal's safety whilst in prison was such that the otherwise appropriate penalty, namely imprisonment, ought not be imposed then the whole of the criminal justice system which operates in our society would be undermined. This court cannot bow to pressure from criminals. In our society imprisonment is the method of punishment primarily imposed for serious criminal offences. Judges must be able, however, to have 38 R v York; Ex parte Attorney-General (Q) [2004] QCA 361 at [6]. 39 [2004] QCA 361 at [21]. confidence that those administering the prisons will ensure the physical safety of those persons placed in their responsibility." White J expressed her different conclusion in the following way40: "What then should the court do in light of the further material provided by the Department of Corrective Services? In my view the Attorney-General has failed to adduce evidence or sufficient evidence to contradict that which was before her Honour. This, it cannot be emphasised too strongly, is far from concluding that the Department is unable to keep the [appellant] safe from the harm to which the material clearly shows she is exposed. The Department has chosen not to be responsive to the uncontested detailed evidence of risk contained in its own Intelligence Unit report in a way which would permit this court to decide if the [appellant] ought, in balancing all of the factors, serve some Any concerns about revealing security actual period in prison. programmes or the like could have been accommodated by sealing the evidence. Had I been satisfied on the further evidence which the Attorney-General had an opportunity to adduce of an appropriate plan for the [appellant] I may well have allowed the appeal and ordered that the sentence of five years be suspended after serving two years. But this has not occurred." The appeal to this Court The appellant appeals to this Court, contending that there was no, or no sufficient basis for the interference by the Court of Appeal with the exercise of the sentencing judge's discretion. The respondent's appeal to the Court of Appeal was governed by s 669A(1) of the Criminal Code (Q) ("the Code") which provides: sentence pronounced by – The Attorney-General may appeal to the Court against any the court of trial; a court of summary jurisdiction in a case where an indictable offence is dealt with summarily by that court, and the court may in its unfettered discretion vary the sentence and impose such sentence as to the Court seems proper." 40 [2004] QCA 361 at [62]. "Court of trial" includes a sentencing court (s 668). Section 669A(1) in its present form replaced the earlier s 669A which was introduced in 1939, and which was in similar terms to the current section except for the important addition of the word "unfettered" before the word "discretion". It is convenient to deal first with the proposition that undue significance was given to the risks the appellant potentially faced if imprisoned, because they were, and would remain as great if she were at large. In this regard reliance was placed by the respondent on some matters advanced by the appellant's counsel at the sentencing hearing. After the murderer's committal in December 1999, the appellant was visited at her residence by a masked and armed male former prison inmate. The intruder told the appellant that if she testified she would be shot. The man was in possession of a transcript of the appellant's evidence. After the appellant testified at the first trial of the murderer further threats were made, and, after his appeal on 27 June 2001, another former inmate of the prison where he was being held, visited the appellant and reiterated the threats. Despite them, the appellant continued to refuse witness protection. As late as August 2003, she was advised by police that their information was that "a contract [had been] put out on her". During June 2004, the appellant was living on a property in northern Queensland. The malice of the threats provides not only a measure of the risk to the appellant, but also of the importance of the assistance that she rendered to the respondent. The respondent drew attention to Dinsdale v The Queen41. The statutory language, of s 689(3) of the Criminal Code (WA)42 under consideration there, is different from s 669A(1) of the Code, but in substance is to much the same effect, because it obliges the Court of Criminal Appeal of Western Australia, if it think a different sentence should have been passed, to pass it. We would have been inclined to give "unfettered" in s 669A(1) of the Code its ordinary meaning, that is, fully unrestricted. Such a reading is, we 41 (2000) 202 CLR 321. 42 Section 689(3) of the Criminal Code (WA) provides: "On an appeal against sentence the Court of Criminal Appeal shall, if they think that a different sentence should have been passed, quash the sentence passed at the trial, and pass such other sentence warranted in law by the verdict or which may lawfully be passed for the offence of which the appellant or an accused person stands convicted (whether more or less severe) in substitution therefor as they think ought to have been passed and in any other case shall dismiss the appeal." think, consistent with the second reading speech for the Bill introducing this section into the Code43: "The Bill is being amended to make it clear that the Court of Criminal Appeal has an unfettered discretion to determine the proper sentence to impose when the Attorney-General has appealed against the inadequacy of the sentence. The private legal profession is opposed to this amendment. I do not propose to alter this amendment because it only makes clear what was always intended, and was in fact acted upon by the Court of Criminal Appeal for 30 years until 1973, when a court decision effectively changed the law to what was not intended." The decision referred to in the speech was R v Liekefett; Ex parte Attorney-General (Q)44 in which the Court of Criminal Appeal of Queensland (Hart, Matthews and Kneipp JJ) said45: "In the result we have concluded that there is no decision which binds us to any particular view as to the circumstances in which the discretion reposed in this Court by s 669A should be exercised. We think that the most satisfactory approach in an appeal by the Attorney-General is that which the High Court said should be adopted in an appeal by a convicted person in the passage we have cited from House v The King46. So to hold, is in accordance with the views expressed by Isaacs J in Whittaker v The King47, and by the Court of Criminal Appeal of New South Wales in Reg v Cuthbert48. Both appeals are from the exercise of a discretion and there is no reason why the same principle should not apply." Despite the ample, explicitly unfettered discretion that the Code appears to confer, this appeal falls to be resolved upon the basis that error in the exercise of the sentencing judge's discretion must be demonstrated before an appellate court 43 Queensland, Legislative Assembly, Parliamentary Debates (Hansard), 23 April 44 [1973] Qd R 355. 45 [1973] Qd R 355 at 366. 46 (1936) 55 CLR 499. 47 (1928) 41 CLR 230 at 250. 48 [1967] 2 NSWR 329. can intervene to alter the sentence imposed at first instance, for these reasons. First, Dinsdale so holds. The holding that was made there was made under legislation relevantly indistinguishable, and was that error of the kind referred to in House v The King49 must still be shown to justify appellate intervention. Queensland appellate authority50 directly on point is to a similar effect. The respondent in this appeal offers no argument to the contrary. Indeed the respondent expressly accepted in the Court of Appeal, and on this appeal, that such an onus lay upon it. The appellant has not therefore ever had to conduct her case and this appeal upon any other basis. It would be unjust for her to be required to deal with them upon any different basis now. These reasons are compelling, and relieve us of any necessity to consider the other submissions of the parties51. It was not suggested that the sentencing judge failed to apply or misapplied the sentencing guidelines prescribed by s 9 of the Penalties and Sentences Act 1992 (Q), or that, for example, the matters she took into account were not "relevant circumstance[s]" within sub-s (2)(q) thereof. It is accordingly necessary to approach the appeal on this basis, as both parties accept, that the respondent was bound to show in the Court of Appeal appellable discretionary error on the part of the sentencing judge. The error, the respondent submitted, was that the sentence was manifestly inadequate: anything less, as the sentence at first instance was, than two and a half years of actual imprisonment, would be, as the Court of Appeal held, manifestly inadequate. The appellant's submission is of course that no discretionary error on the part of the sentencing judge has been established, either in the Court of Appeal or here. There is no doubt that a gross, indeed even perhaps a marked deficiency or excess in a sentence, may constitute a manifest error in the sentence: that error has been made appears sufficiently from the fact of the deficiency or the excess. But we do not think that this can, without important qualification, be said to be so of this case. 49 (1936) 55 CLR 499. 50 R v Osmond; Ex parte Attorney-General (Q) [1987] 1 Qd R 429. 51 For example, the effect of the constraints imposed by the Penalties and Sentences Act 1992 (Q) s 9; the principle that courts should impose sentences at the lower end of the scale in appeals by the prosecution; and error on the part of the prosecution is ordinarily not to be used or held against an accused in a prosecution appeal. The majority having concluded that the appellant's destination, if they were to substitute a custodial sentence, was in all likelihood a prison without a protective custody section, and not having reached any different factual conclusion as to the risks to the appellant from that of the sentencing judge, were not, in our opinion, bound, as they thought they were, to substitute a custodial sentence on this basis52: that "Once [the] court accepts that the risk to a criminal's safety whilst in the otherwise appropriate penalty, namely prison was such imprisonment, ought not be imposed then the whole of the criminal justice system which operates in our society would be undermined. ... Judges must be able, however, to have confidence that those administering the prisons will ensure the physical safety of those persons placed in their responsibility." This is not to identify sentencing error on the part of the trial judge, but to express a hope that the facts will turn out to be different from the uncontradicted, plausible and therefore compelling evidence as to them which was accepted and relied on by the trial judge. This is so even if "must" were intended in the passage quoted, to mean "should". If the responsible authorities choose not to, or are unable to respond to the risks proved in a case, courts can and will be left with the impression, as the sentencing judge was here, that those authorities are indifferent to, or insufficiently concerned for the physical safety of incarcerated persons. The imposition of a sentence of a shorter duration, because of the risks to the appellant's safety, than would otherwise be imposed, can do nothing to meet or reduce those risks except the period of exposure to them. The unusually strong and uncontradicted evidence in this case made it a special one. In those circumstances there was no sufficient basis for interference with the primary judge's sentencing discretion. We would allow the appeal, set aside the orders of the Court of Appeal, and order that the sentence and orders of the primary judge be restored. 52 [2004] QCA 361 at [21] (emphasis added).

HIGH COURT OF AUSTRALIA DEPUTY COMMISSIONER OF TAXATION APPELLANT AND RESPONDENT Deputy Commissioner of Taxation v Huang [2021] HCA 43 Date of Hearing: 13 October 2021 Date of Judgment: 8 December 2021 ORDER Appeal allowed with costs. Set aside orders 4 to 9 of the orders of the Full Court of the Federal Court of Australia made on 28 September 2020 and, in their place, order that: the applicant be granted leave to appeal; and the appeal be dismissed with costs. On appeal from the Federal Court of Australia Representation S P Donaghue QC, Solicitor-General of the Commonwealth, and S B Lloyd SC with L T Livingston SC for the appellant (instructed by B W Walker SC with G E S Ng and Y H Li for the respondent (instructed by Unsworth Legal) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Deputy Commissioner of Taxation v Huang Practice and procedure – Freezing orders – Power of Federal Court of Australia to make worldwide freezing order conferred by r 7.32 of Federal Court Rules 2011 (Cth) – Where appellant commenced proceedings against respondent in Federal Court – Where appellant applied to Federal Court for worldwide freezing order – Where assets located in People's Republic of China and Hong Kong – Where presently no realistic possibility of enforcement of appellant's judgment debt in each foreign jurisdiction where assets located – Where freezing order made – Whether worldwide freezing order within power of Federal Court where presently no realistic possibility of enforcement in each foreign jurisdiction. Words and phrases – "assets outside Australia", "danger that a judgment or prospective judgment of the Court will be wholly or partly unsatisfied", "freezing order", "frustration or inhibition of the Court's process", "realistic possibility of enforcement", "worldwide freezing order". Federal Court Rules 2011 (Cth), rr 7.32, 7.35. Federal Court of Australia Act 1976 (Cth), s 23. GAGELER, KEANE, GORDON AND GLEESON JJ. This appeal concerns whether the power of the Federal Court of Australia to make an order restraining a person from disposing of, dealing with or diminishing the value of assets, including assets located in or outside Australia (a "Worldwide Freezing Order"), conferred by r 7.32 of the Federal Court Rules 2011 (Cth) ("the Rules"), may only be exercised if there is proof of a realistic possibility of enforcement of a judgment debt against the person's assets in each foreign jurisdiction to which the proposed order relates. Rule 7.32 states: "(1) The Court may make an order (a freezing order), with or without notice to a respondent, for the purpose of preventing the frustration or inhibition of the Court's process by seeking to meet a danger that a judgment or prospective judgment of the Court will be wholly or partly unsatisfied. (2) A freezing order may be an order restraining a respondent from removing any assets located in or outside Australia or from disposing of, dealing with, or diminishing the value of, those assets." For the following reasons, the Full Court of the Federal Court of Australia erred in holding that the power in r 7.32 is constrained by such a precondition. Accordingly, the appeal must be allowed. Background to appeal The respondent, Mr Huang, and his wife, Mrs Huang, were tax residents of Australia from 1 February 2013. On 4 December 2018, Mr Huang left Australia for the People's Republic of China ("the PRC"). At the time of his departure, the Australian Taxation Office was conducting an audit into Mr Huang's income tax affairs. Mrs Huang left Australia, also for the PRC, on 11 September 2019. On 11 September 2019, the Commissioner of Taxation issued to Mr Huang assessments for tax liabilities and a shortfall penalty totalling almost $141 million. On 16 September 2019, the appellant ("the Deputy Commissioner") filed an originating application in the Federal Court seeking judgment against Mr Huang based on the assessments. On the same day, a single judge of the Federal Court, Katzmann J, made an ex parte interim order against Mr Huang ("the interim order")1. The interim order was a Worldwide Freezing Order, effective up to and including 20 September 2019, and substantially in the terms set out in Annexure A to the Federal Court's Freezing Orders Practice Note (GPN-FRZG) published on 1 Deputy Commissioner of Taxation v Huang (2019) 110 ATR 673. Gordon Gleeson 25 October 2016 ("the Practice Note"). Most relevantly, the interim order required Mr Huang to refrain from disposing of, dealing with or diminishing the value of his Australian assets up to the amount claimed in the originating application and his assets outside Australia to the extent that the value of Mr Huang's unencumbered Australian assets was less than the amount claimed in the originating application. On 20 September 2019, the interim order against In her reasons for making the interim order, Katzmann J referred to rr 7.32 and 7.35 of the Rules. Rule 7.35 states relevantly: "(1) This rule applies if: judgment has been given in favour of an applicant by: the Court; or for a judgment to which subrule (2) applies – another court; or an applicant has a good arguable case on an accrued or prospective cause of action that is justiciable in: the Court; or for a cause of action to which subrule (3) applies – another court. This subrule applies to a judgment if there is a sufficient prospect that the judgment will be registered in or enforced by the Court. This subrule applies to a cause of action if: there is a sufficient prospect that the other court will give judgment in favour of the applicant; and there is a sufficient prospect that the judgment will be registered in or enforced by the Court. The Court may make a freezing order or an ancillary order or both against a judgment debtor or prospective judgment debtor if the Court is satisfied, having regard to all the circumstances, that there is a danger that a judgment or prospective judgment will be wholly or partly unsatisfied because any of the following might occur: Gordon Gleeson the judgment debtor, prospective judgment debtor or another person absconds; the assets of the judgment debtor, prospective judgment debtor or another person are: removed from Australia or from a place inside or outside Australia; or disposed of, dealt with or diminished in value. (6) Nothing in this rule affects the power of the Court to make a freezing order or ancillary order if the Court considers it is in the interests of justice to do so." Katzmann J found that r 7.35 applied because the Deputy Commissioner had a good arguable case against Mr Huang within r 7.35(1)(b)(i)2. Her Honour also found, in accordance with r 7.35(4)(b)(i) and (ii), that there was a danger that the Deputy Commissioner's prospective judgment against Mr Huang would be wholly or partly unsatisfied because his assets might be removed from Australia or disposed of, dealt with or diminished in value3. Her Honour gave the following seven reasons for finding this danger4: (1) Mr Huang's tax liability of over $140 million was "considerable". The results of the tax audit indicated an intention to avoid paying tax by grossly understating income. (3) Mr Huang was a Chinese national, currently overseas, without an Australian visa who, since November 2018, had taken a number of steps towards severing his ties to Australia. (4) Mr Huang's Australian assets did not seem to be enough to satisfy the tax liability. 2 Deputy Commissioner of Taxation v Huang (2019) 110 ATR 673 at 681 [45]. 3 Deputy Commissioner of Taxation v Huang (2019) 110 ATR 673 at 681-682 [49]. 4 Deputy Commissioner of Taxation v Huang (2019) 110 ATR 673 at 682 [50]-[57]. Gordon Gleeson (5) Mr Huang was likely to be a person of substantial wealth and has significant business interests in the PRC, including Hong Kong, that allowed him to easily move assets between jurisdictions. These circumstances demonstrated that Mr Huang had both a motive and the means to dissipate his Australian assets. (6) Mr Huang had already taken steps to divest himself of his interest in Australian companies and trusts. Although he transferred money overseas before becoming aware that he was under investigation by the Australian Taxation Office, the amount of money transferred increased dramatically after the audit began. The recent issue of the tax assessment notices increased the likelihood of dissipation. On 11 October 2019, the Deputy Commissioner applied for summary judgment against Mr Huang and a Worldwide Freezing Order against Mr Huang until further order. The applications were heard by another judge of the Federal Court, Jagot J ("the primary judge"). Before the primary judge, Mr Huang did not oppose the freezing order to the extent that it related to his assets in Australia, and subject to the Deputy Commissioner giving certain undertakings. Nor did Mr Huang object to filing an affidavit disclosing his assets in Australia. Further, Mr Huang did not seek to revisit the findings which led Katzmann J to make the interim order, instead confining his submissions to the single issue of whether the order should operate in respect of his assets outside Australia and, in particular, assets located in Hong Kong and the PRC. On 21 October 2019, the primary judge made a Worldwide Freezing Order against Mr Huang until further order, in substantially the same terms as the interim order. Her Honour rejected Mr Huang's contention that the order affecting his significant assets in the PRC and Hong Kong did not serve the purpose of protecting or preventing the frustration of the Federal Court's process because there was no process available for enforcement of any judgment in the Deputy Commissioner's favour in those jurisdictions. She concluded that the issue was "the preservation of the integrity or efficacy of any process ultimately enforceable by the Court"5. Her Honour considered that there were sufficient possibilities of 5 Deputy Commissioner of Taxation v Huang [2019] FCA 1728 at [28] (emphasis in original). Gordon Gleeson enforcement to enable the conclusion that the purpose specified in r 7.32(1) was "... the potential use of bankruptcy procedures, the potential willingness of the courts of Hong Kong and China to enforce Australian insolvency laws, the possibility of [Mr Huang] moving assets to other jurisdictions where enforcement is readily available, as well as the potential willingness of the courts of Hong Kong and China to enforce Australian laws relating to the payments of penalties and interest." Her Honour found that "it is not impossible that the [Deputy Commissioner] may be able to take enforcement action against [Mr Huang] as a result of one or more of the possibilities" identified by the Deputy Commissioner8. On 19 December 2019, the primary judge gave judgment in favour of the Deputy Commissioner against Mr Huang in an amount of just over $140.6 million plus general interest charges to the date of judgment. Mr Huang acknowledged that he had no defence, and that the tax debt claimed by the Deputy Commissioner was due and payable9. Her Honour refused Mr Huang's application for a stay of execution of the judgment10. There was no appeal by Mr Huang from these orders. Full Court's reasons The Full Court granted Mr Huang leave to appeal from the Worldwide Freezing Order made by the primary judge and allowed the appeal. In the Full Court, Mr Huang's contention was that the primary judge's order was beyond the Federal Court's power in r 7.32(1) because the primary judge could not satisfy herself that the order had the purpose required by r 7.32(1) in the absence of a realistic possibility that Mr Huang either had assets in, or would move 6 Deputy Commissioner of Taxation v Huang [2019] FCA 1728 at [30]. 7 Deputy Commissioner of Taxation v Huang [2019] FCA 1728 at [30]. 8 Deputy Commissioner of Taxation v Huang [2019] FCA 1728 at [28]. 9 Deputy Commissioner of Taxation v Huang [2019] FCA 2122 at [3]. 10 Deputy Commissioner of Taxation v Huang [2019] FCA 2122 at [27]. Gordon Gleeson assets to, jurisdictions in which an Australian judgment based on a tax debt owed to the Commonwealth could be enforced, either directly or indirectly. The Full Court concluded that, in deciding whether the Federal Court had power to make the order, the primary judge stated and applied a test that enforcement of the prospective judgment was "not impossible"11. After referring to r 7.35(4), and noting that the power in r 7.32 to make a freezing order must not be exercised for a purpose other than that stated in r 7.32, the Full Court reasoned as follows12: "If assets are beyond the reach of the Court's enforcement processes, then a freezing order with respect to those assets is not for the purpose identified in r 7.32 because there is no longer a realistic possibility that the removal or disposition of the assets will frustrate or inhibit the Court's process such that a judgment or prospective judgment will be wholly or partly unsatisfied. In our opinion, there must be a realistic possibility that any judgment obtained by the plaintiff can be enforced against assets of the defendant in the place to which the proposed order relates. A test of 'not impossible' is somewhat indefinite in meaning and, in our view, sets the bar too low. A test of a realistic possibility is consistent with the approach taken by the courts in determining what must be shown in terms of the risk of the removal of assets or the disposal of assets, matters to which a freezing order is directed. This last matter is either part of the same composite concept as the matter of enforcement or, at least, it is a closely allied concept. Although the word 'danger' in the rule does not mean that the risk of removal or dissipation must be more probable than not (Deputy Commissioner of Taxation v Chemical Trustee Ltd (No 4) (2012) 90 ATR 711 at [23] per Perram J), it does mean that there must be a realistic possibility (as we have put it) or a danger sufficiently substantial to warrant the grant of an injunction (Patterson v BTR Engineering (Aust) Ltd (1989) 18 NSWLR 319 (Patterson) at 325 per Gleeson CJ), or a sufficient likelihood of risk of dissipation which, in the particular circumstances, justifies an asset 11 Huang v Deputy Commissioner of Taxation (2020) 280 FCR 160 at 169-170 [34]. 12 Huang v Deputy Commissioner of Taxation (2020) 280 FCR 160 at 171 [42]-[43]. Gordon Gleeson preservation order (Victoria University of Technology v Wilson [2003] VSC 299 at [36] per Redlich J)." The Full Court concluded that the matters relied upon by the primary judge did not provide a basis for concluding that enforcement of the Deputy Commissioner's prospective judgment debt against Mr Huang in the PRC or Hong Kong was a realistic possibility13. Accordingly, the Full Court made orders varying the primary judge's order to exclude Mr Huang's non-Australian assets. The Full Court's orders were subsequently stayed pending the determination of the appeal to this Court. The Deputy Commissioner does not dispute the Full Court's finding that there is presently no realistic possibility that the Deputy Commissioner's judgment would be enforceable in the PRC or Hong Kong. Among other reasons, the PRC and Hong Kong have each entered a reservation to the Convention on Mutual Administrative Assistance in Tax Matters, to the effect that they "shall not provide assistance in the recovery of tax claims, or in conservancy measures, for all taxes". It is also not in dispute that Mr Huang, having submitted to the Federal Court's jurisdiction, is required to comply with its process and orders. Freezing orders under r 7.32 of the Rules Rule 7.32, in Div 7.4 of the Rules, supplements s 23 of the Federal Court of Australia Act 1976 (Cth) ("the Federal Court Act") and the Federal Court's implied power as a superior court, each of which confers power upon the Court to make such orders as are appropriate for the proper exercise of its statutorily conferred jurisdiction and powers14. That relationship is emphasised by r 7.36, which provides that nothing in Div 7.4 diminishes the inherent, implied or statutory jurisdiction of the Court to make a freezing order or ancillary order. The power conferred by r 7.32(1) is expressly subject to two limitations: first, the purpose of the order must be "the purpose of preventing the frustration or inhibition of the Court's process"; and secondly, the order must address that 13 Huang v Deputy Commissioner of Taxation (2020) 280 FCR 160 at 173 [50], 176 14 Jackson v Sterling Industries Ltd (1987) 162 CLR 612 at 623; Patrick Stevedores Operations No 2 Pty Ltd v Maritime Union of Australia (1998) 195 CLR 1 at 32-33 [35]; Cardile v LED Builders Pty Ltd (1999) 198 CLR 380 at 393-394 [25]-[26]. Gordon Gleeson purpose "by seeking to meet a danger that a judgment or prospective judgment of the Court will be wholly or partly unsatisfied". The first limitation corresponds with the established scope of the Federal Court's general powers to grant a freezing order, being the power to make such orders as the Court may determine to be appropriate to prevent the abuse or frustration of its process in relation to matters coming within its jurisdiction15. Rule 7.32 states explicitly the requirement, stated by this Court in relation to the Federal Court's general powers to grant a freezing order, that the power must be exercised for the purpose for which it is conferred16. Where the order is made in proceedings in which substantive relief is sought against the defendant, that purpose is "to prevent a defendant from disposing of his actual assets (including claims and expectancies) so as to frustrate the process of the court by depriving the plaintiff of the fruits of any judgment obtained in the action"17. More broadly, a freezing order is directed to dispositions "which are intended to frustrate, or have the necessary effect of frustrating, the plaintiff in his attempt to seek through the court a remedy for the obligation to which he claims the defendant is subject"18. The second limitation, that an order made under r 7.32 must serve the specified purpose "by seeking to meet a danger that a judgment or prospective judgment of the Court will be wholly or partly unsatisfied", also corresponds with the scope of the Federal Court's general powers to make a freezing order. Since Jackson v Sterling Industries Ltd, it has been accepted in Australia, as a general proposition, that a freezing order could be granted if the circumstances are such that there is a danger of the defendant absconding, or a danger of the assets being removed from the jurisdiction or disposed of within the jurisdiction, or otherwise dealt with so that there is a danger that the plaintiff, if successful in obtaining a 15 Jackson v Sterling Industries Ltd (1987) 162 CLR 612 at 623; Patrick Stevedores Operations No 2 Pty Ltd v Maritime Union of Australia (1998) 195 CLR 1 at 32-33 [35]; Cardile v LED Builders Pty Ltd (1999) 198 CLR 380 at 399-401 [41]; Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199 at 243 [94]; PT Bayan Resources TBK v BCBC Singapore Pte Ltd (2015) 258 CLR 1 at 18 [43]. 16 Patrick Stevedores Operations No 2 Pty Ltd v Maritime Union of Australia (1998) 195 CLR 1 at 32-33 [35]; Cardile v LED Builders Pty Ltd (1999) 198 CLR 380 at 17 Jackson v Sterling Industries Ltd (1987) 162 CLR 612 at 625. 18 Riley McKay Pty Ltd v McKay [1982] 1 NSWLR 264 at 276. Gordon Gleeson judgment, will not be able to get it satisfied19. The danger must be sufficiently substantial to warrant the freezing order20. The need to identify a relevant danger was first articulated in Mareva Compania Naviera SA v International Bulkcarriers SA21, where Lord Denning MR stated: "If it appears that the debt is due and owing – and there is a danger that the debtor may dispose of his assets so as to defeat it before judgment – the Court has jurisdiction in a proper case to grant an interlocutory judgment so as to prevent him disposing of those assets." Rule 7.32(2) explicitly contemplates that a freezing order within r 7.32 may apply to assets located outside Australia, reflecting the power of a superior court to make a freezing order in respect of foreign assets, first identified in Ballabil Holdings Pty Ltd v Hospital Products Ltd22. The Practice Note assumes that the Federal Court's power to make a freezing order extends to assets "anywhere in the world"23, and the example form of freezing order in Annexure A to the Practice Note contains provisions which may be included if the Court makes a Worldwide Freezing Order24. Mr Huang sought to defend the Full Court's conclusion that an order under r 7.32 could not be for the requisite purpose of preventing the frustration or inhibition of the Federal Court's process unless there was a realistic possibility of the freezing order's efficacy. That defence was based principally on the asserted 19 Jackson v Sterling Industries Ltd (1987) 162 CLR 612 at 623. See, eg, Patterson v BTR Engineering (Aust) Ltd (1989) 18 NSWLR 319 at 321-322. 20 Patterson v BTR Engineering (Aust) Ltd (1989) 18 NSWLR 319 at 325. [1975] 2 Lloyd's Rep 509 at 510. (1985) 1 NSWLR 155, cited in Jackson v Sterling Industries Ltd (1987) 162 CLR 23 Federal Court of Australia, Freezing Orders Practice Note (GPN-FRZG), 25 October 2016 at 2 [2.8]. 24 Federal Court of Australia, Freezing Orders Practice Note (GPN-FRZG), 25 October 2016, Annexure A, para 6(c). Gordon Gleeson effect of r 7.35 of the Rules upon r 7.32 or, alternatively, on the purposive requirement in r 7.32. The argument based upon r 7.35 can be readily dismissed. Rule 7.35 is not expressed to affect the operation of r 7.32 and, contrary to Mr Huang's submission, there is no reason to read r 7.32 as subject to r 7.35. Both r 7.35(6) and r 7.36 are expressly to the contrary25. Rather, r 7.35 extends the scope of r 7.32, including by confirming the rule's application to cases that may have otherwise been in doubt, namely where there is a "prospective" cause of action and in relation to processes of a foreign court. Where r 7.35 applies, r 7.35(4) supplements the power in r 7.32 by identifying reasons why the Court may be satisfied, having regard to all the circumstances, that a danger of the kind specified in both r 7.32 and r 7.35(4) exists. Mr Huang also contended that r 7.35(4) covers the field of events that might give rise to a danger of the kind necessary to enliven the power in r 7.32. In this case, the interim order was made on the basis of Katzmann J's satisfaction as to the danger on the basis that the circumstances stated in r 7.35(4)(b)(i) and (ii) might occur. That finding was not disputed before the primary judge. As a practical matter, in most cases the danger required by r 7.32 will be proved because of one or more of the circumstances set out in r 7.35(4). However, r 7.35(4) does not cover the field. As already noted, both r 7.35(6) and r 7.36 explicitly contemplate that a freezing order may be made even though the applicant is unable to satisfy r 7.35(4). By way of example, r 7.32 may apply where a defendant deliberately and openly moves from Australia, leaving insufficient assets to satisfy a prospective judgment debt and stating an intention not to comply with the prospective judgment. Mr Huang's alternative argument, that the purposive requirement in r 7.32 entails a further requirement of possible efficacy of the freezing order, must also be rejected for several reasons. First, r 7.32 does not say so and provisions granting powers to a court are not to be read down by making implications or imposing limitations which are not found in the express words26. 25 cf Anthony Hordern & Sons Ltd v Amalgamated Clothing and Allied Trades Union of Australia (1932) 47 CLR 1 at 7. 26 Owners of "Shin Kobe Maru" v Empire Shipping Co Inc (1994) 181 CLR 404 at 421; Weinstock v Beck (2013) 251 CLR 396 at 419-420 [55]; Minister for Home Affairs v DMA18 (2020) 95 ALJR 14 at 23 [27]; 385 ALR 16 at 26. Gordon Gleeson Secondly, there is no reason to imply an unexpressed limitation on the scope of the power in r 7.32, where r 7.32 is, in substance, a restatement of the powers under s 23 of the Federal Court Act and the Federal Court's implied power and there is no similar limitation upon those powers. Thirdly, the Full Court's efficacy requirement is inconsistent with the in personam nature of a freezing order27. It is the court's authority to make orders against a person who is subject to the court's jurisdiction that is relevant to the court's power to make a freezing order and not the location of the person's assets. In Ballabil Holdings Pty Ltd v Hospital Products Ltd28, neither Street CJ nor Glass JA found it necessary to consider the precise location of the assets in question. Priestley JA saw no reason why the order should be limited to assets within the court's jurisdiction, concluding that when exercising the jurisdiction to make a Mareva injunction (as a freezing order was then termed) "the location of the company's assets can have no bearing on the extent of the court's jurisdiction, although it may ... affect the court's discretionary exercise of those powers"29. Fourthly, the Full Court's requirement is inconsistent with the evident purpose of r 7.32, restricting the power in a manner that would significantly impair its capacity to protect the Federal Court's process, including by granting urgent relief. Such a requirement would render the power largely impotent to protect the Court's process from frustration by defendants who are able to secrete their assets or move them almost instantaneously across international borders. Unaffected by a Worldwide Freezing Order, a defendant would be free to move assets surreptitiously to a jurisdiction not covered by the order. The requirement would also substantially defeat the utility of the power in r 7.33 to make an order ancillary to a freezing order for the purpose of eliciting information relating to assets relevant to the freezing order because such information could only concern assets that have been identified. The Full Court's focus upon the possible availability of enforcement processes in foreign jurisdictions ignored other ways that a judgment may eventually be satisfied, such as following the appointment of a receiver pursuant 27 Cardile v LED Builders Pty Ltd (1999) 198 CLR 380 at 403 [50]. See also Derby & Co Ltd v Weldon [No 6] [1990] 1 WLR 1139 at 1149-1150; [1990] 3 All ER 263 at (1985) 1 NSWLR 155. 29 Ballabil Holdings Pty Ltd v Hospital Products Ltd (1985) 1 NSWLR 155 at 165. Gordon Gleeson to s 57(1) of the Federal Court Act30. And, although Mr Huang sought to deprecate it, there is no reason to ignore the possibility that a defendant, who is demonstrated to have created the relevant danger, may be induced by the inconvenience of a freezing order, falling short of oppression, to comply with the Court's process. Finally, the Full Court's requirement is effectively inconsistent with the power to make a Worldwide Freezing Order, similar to a power recognised in numerous foreign jurisdictions31, because it necessitates identification of the defendant's foreign assets as well as a potential means of enforcement in a relevant foreign jurisdiction. In Broad Idea International Ltd v Convoy Collateral Ltd, the Privy Council recently observed that the granting of worldwide freezing orders has "long since ceased to be exceptional"32. Notably it is now more than 30 years since the English Court of Appeal in Derby & Co Ltd v Weldon [Nos 3 & 4]33 rejected an argument that s 37 of the Supreme Court Act 1981 (UK) did not confer jurisdiction to make a Mareva injunction against a Panamanian company in the absence of evidence that the order could be enforced against the company in Panama or elsewhere. Lord Donaldson of Lymington MR (Neill LJ and Butler- Sloss LJ agreeing34) considered it a "mistake to spend time considering whether English orders and judgments can be enforced against Panamanian companies in 30 Gujarat NRE Coke Ltd v Coeclerici Asia (Pte) Ltd (2013) 304 ALR 468 at 487 [75]- [76]. See also Caird Seven Pty Ltd v Attia and Shopsmart Pharmacy Franchising Pty Ltd [No 3] (2016) 92 NSWLR 457 at 462 [16]; Masri v Consolidated Contractors International (UK) Ltd [No 2] [2009] QB 450 at 470 [50]; Aitken, "No Alsatias: 'Equitable execution', and recent developments in the asset preservation order" (2015) 40 Australian Bar Review 52. 31 See, eg, Babanaft International Co SA v Bassatne [1990] Ch 13; Republic of Haiti v Duvalier [1990] 1 QB 202; Derby & Co Ltd v Weldon [1990] Ch 48 (United Kingdom); Natural Gas Corporation Holdings Ltd v Grant [1994] 2 NZLR 252 (New Zealand); Davis v Turning Properties Pty Ltd (2005) 222 ALR 676 (Bahamas); Akai Holdings Ltd (in compulsory liquidation) v Ho Wing On [2009] HKCU 172 (Hong Kong); Equustek Solutions Inc v Jack (2015) 386 DLR (4th) 224 (Canada); Bouvier v Accent Delight International Ltd [2015] 5 SLR 558 (Singapore). [2021] UKPC 24 at [20]. 34 Derby & Co Ltd v Weldon [Nos 3 & 4] [1990] Ch 65 at 95, 96. Gordon Gleeson Panama" at the time of making the injunction35. Butler-Sloss LJ observed that factors such as the impossibility of compliance with, or enforcement of, a worldwide Mareva injunction are relevant considerations in exercise of discretion36, and noted that there was presently no evidence that the injunction would be unenforceable. A freezing order operates to preserve the status quo and not to change it in favour of the party who seeks the order37. Mr Huang submitted that the status quo in this case is the existence of assets not liable to execution by any process available to the Deputy Commissioner. That characterisation ignores that "[c]ourts assume, rightly, that those who are subject to its jurisdiction will obey its orders"38, including, relevantly, a final judgment to pay a tax debt. The status quo to be preserved by the freezing order is the existence of assets which could be realised to pay the prospective judgment debt. None of the above should be taken to suggest that courts should not be astute to ensuring that a worldwide freezing order does not become an instrument of oppression. As with any freezing order, it is a remedy which should not be granted lightly39. The likely utility of a freezing order is undoubtedly relevant to the exercise of the court's discretion to grant the order40. A court may decline to make a freezing order because the defendant is outside the jurisdiction and is likely 35 Derby & Co Ltd v Weldon [Nos 3 & 4] [1990] Ch 65 at 81-82. 36 Derby & Co Ltd v Weldon [Nos 3 & 4] [1990] Ch 65 at 96, 98. 37 Cardile v LED Builders Pty Ltd (1999) 198 CLR 380 at 403-404 [51]. 38 Derby & Co Ltd v Weldon [Nos 3 & 4] [1990] Ch 65 at 81, citing In re Liddell's Settlement Trusts [1936] Ch 365 at 374. 39 Cardile v LED Builders Pty Ltd (1999) 198 CLR 380 at 403-404 [51]; Derby & Co Ltd v Weldon [1990] Ch 48 at 55, 62; Derby & Co Ltd v Weldon [Nos 3 & 4] [1990] Ch 65 at 96; Dadourian Group International Inc v Simms [2006] 1 WLR 2499 at 2501 [24]; [2006] 3 All ER 48 at 54. 40 Ballabil Holdings Pty Ltd v Hospital Products Ltd (1985) 1 NSWLR 155 at 165; Jackson v Sterling Industries Ltd (1987) 162 CLR 612 at 622-623; Derby & Co Ltd v Weldon [Nos 3 & 4] [1990] Ch 65 at 81-82. Gordon Gleeson to ignore the order41, but it should not be deterred by a defendant's contumelious behaviour from making an order that is otherwise appropriate42. The discretionary nature of the power provides a further reason why the Federal Court would not strive to read into the purposive requirement in r 7.32 an additional requirement about the prospects of enforcement. It follows that the Full Court asked itself the wrong question in considering, as a matter going to the existence of the broad and flexible power conferred by r 7.32, whether there was a realistic possibility that the prospective judgment could be enforced against the defendant's assets in any relevant foreign jurisdiction. In determining whether the Federal Court had power to make the Worldwide Freezing Order, the question was whether the order would seek to meet a danger that the prospective judgment will be wholly or partly unsatisfied. Conclusion The appeal must be allowed. Costs should follow the event. Orders 4 to 9 of the orders of the Full Court made on 28 September 2020 must be set aside and, in their place, order that leave to appeal to the Full Court be granted and the appeal be dismissed with costs. 41 Humane Society International Inc v Kyodo Senpaku Kaisha Ltd (2006) 154 FCR 425 at 431 [16]; BAS Capital Funding Corp v Medfinco Ltd [2004] 1 Lloyd's Rep 652 at 680 [202]; Motorola Credit Corpn v Uzan [No 2] [2004] 1 WLR 113 at 147 42 Australian Competition and Consumer Commission v Chen (2003) 132 FCR 309 at 321 [43]; Humane Society International Inc v Kyodo Senpaku Kaisha Ltd (2006) 154 FCR 425 at 431 [16]. See also In re Liddell's Settlement Trusts [1936] Ch 365 at 374; Castanho v Brown & Root (UK) Ltd [1981] AC 557 at 574; Derby & Co Ltd v Weldon [Nos 3 & 4] [1990] Ch 65 at 81; South Bucks District Council v Porter [2003] 2 AC 558 at 580-581 [32]. Edelman EDELMAN J. The decision of the majority in this case has salutary commercial consequences. It will deter fraud. It will lessen the extent of evidence that an applicant might be required to lead, especially on an urgent application involving money that could be transferred overseas by the click of a button. It will enhance the efficacy of the "worldwide freezing order" that has proved so valuable in "prevent[ing] the legal process being defeated by the ease and speed with which money and other assets can now be moved from country to country"43. It is an approach that has been taken in numerous cases, including by the primary judge in this case. Those commercial consequences are a reason why I have some regret in dissenting from the reasons of the majority on this appeal. But it must not be forgotten that the power to make a freezing order is a drastic power, the effect of which has been described as draconian44. A freezing order deprives a person of access to their own assets. Its commands are made under the threat of contempt proceedings, and the sanction of imprisonment45. Unless and until a rule of court is made, with sufficient authority, to relax the very limited number of conditions upon the jurisdiction to make freezing orders, those conditions must be strictly followed by courts. The central issue on this appeal concerns the authority of the Federal Court of Australia to make a freezing order in circumstances where there is no reasonable prospect that the freezing order could be enforced. In my view, the Full Court of the Federal Court of Australia was correct to conclude that such a freezing order could not be made. In any event, and however desirable it might be thought to be for the law to weaponise the freezing order, it should be an extremely rare circumstance where a court would exercise a discretion to make a freezing order for a purpose that has no realistic prospect of being fulfilled. I gratefully adopt the background in the reasons of the majority of this Court. My reasons are concerned with a short point of the interpretation of r 7.32 of the Federal Court Rules 2011 (Cth), relating to a restriction upon the power to make a freezing order that requires the court to do so with a particular purpose. 43 See Mercedes Benz AG v Leiduck [1996] AC 284 at 313; PT Bayan Resources TBK v BCBC Singapore Pte Ltd (2015) 258 CLR 1 at 20 [49]. 44 Jaken Properties Australia Pty Ltd v Naaman [2020] NSWSC 1554 at [44]. 45 Federal Court Rules 2011 (Cth), Pt 42. See Cardile v LED Builders Pty Ltd (1999) 198 CLR 380 at 403 [50]; JSC BTA Bank v Ablyazov [No 14] [2020] AC 727. Edelman The same restriction exists in the implied and inherent powers of courts to make freezing orders46, expressly preserved by the Federal Court Rules47. Rule 7.32 requires the court to make a freezing order for a particular purpose which is to be advanced by particular means. Rule 7.32 requires that the court have the particular "purpose of preventing the frustration or inhibition of the Court's process" and that the court advance that purpose by the particular means which involve "seeking to meet a danger that a judgment or prospective judgment of the Court will be wholly or partly unsatisfied". The difference between the two requirements of r 7.32 can be illustrated by an example. Suppose a person had a judgment debt in Australia of $20 million and assets of $25 million in each of Australia and the United Kingdom. If there were a danger that the person might dispose of their assets to defeat enforcement of the judgment, then a worldwide freezing order in the amount of $50 million would be a means to meet a danger that the judgment would be wholly or partly unsatisfied. But a worldwide freezing order in the amount of $50 million would not be solely for the purpose of preventing the frustration or inhibition of the process of the court. An order limited to the freezing of $20 million of assets in Australia could satisfy that requirement. The worldwide freezing order in the amount of $50 million would "go beyond a mere order for the preservation of assets pending judgment or execution"48. In other words, by making an order that extends beyond the minimum necessary to protect the integrity of the process of the court, the worldwide freezing order in the amount of $50 million could not be said to have only the purpose of preventing the frustration or inhibition of the process of the court. The purpose of preventing the frustration or inhibition of the process of the court is not a purpose of "creat[ing] security for the plaintiff"49. It is not a purpose of providing leverage by creating "in effect, a new vulnerability to imprisonment for debt ... to guarantee to a plaintiff that any judgment obtained will be satisfied"50. 46 Patrick Stevedores Operations No 2 Pty Ltd v Maritime Union of Australia (1998) 195 CLR 1 at 32 [35]; Cardile v LED Builders Pty Ltd (1999) 198 CLR 380 at 400 47 Federal Court Rules, r 7.36. 48 Jackson v Sterling Industries Ltd (1987) 162 CLR 612 at 625. 49 Jackson v Sterling Industries Ltd (1987) 162 CLR 612 at 625; PT Bayan Resources TBK v BCBC Singapore Pte Ltd (2015) 258 CLR 1 at 24 [65]. 50 Jackson v Sterling Industries Ltd (1987) 162 CLR 612 at 625. Edelman It is a purpose which is the "counterpart" to a purpose of protecting "the integrity of those processes once set in motion"51. With a purpose that aims only to protect the integrity of the court's processes, freezing orders belong to the family of remedies that protect the integrity of the court from abuse52. Since the jurisdiction of the court is confined to protecting its processes, the jurisdiction extends only to the minimum necessary orders to protect the court's processes from abuse53. The purpose of "preventing the frustration or inhibition of the Court's process" therefore requires an applicant to identify the process of the court that would be frustrated or inhibited. If there is no realistic possibility that any process of the court would be frustrated or inhibited without the freezing order, then the court cannot be acting for the purpose of preventing the frustration or inhibition of the court's process. Courts cannot be taken to act in vain54. It was not submitted in this case that there was any new or separate foundation for the jurisdiction to grant a freezing order which permitted this Court to free itself from the jurisdictional limit confining the freezing order to its purpose of protecting the process of the court from being frustrated or inhibited. In that respect, it may be that Australian law and English law have diverged. In Cardile v LED Builders Pty Ltd55, four members of this Court said that "the English authorities appear to have developed to a stage where what is identified as the Mareva injunction or order lacks any firm doctrinal foundation and is best regarded as some special exception to the general law". In turn, it has recently been observed in the Privy Council that the English approach differs from the Australian 51 CSR Ltd v Cigna Insurance Australia Ltd (1997) 189 CLR 345 at 391; Cardile v LED Builders Pty Ltd (1999) 198 CLR 380 at 393 [25]; PT Bayan Resources TBK v BCBC Singapore Pte Ltd (2015) 258 CLR 1 at 25 [68]. 52 See Strickland (a pseudonym) v Director of Public Prosecutions (Cth) (2018) 266 CLR 325 at 409 [248], 415-417 [265]-[269]. 53 Strickland (a pseudonym) v Director of Public Prosecutions (Cth) (2018) 266 CLR 325 at 410-411 [254], 415 [264]-[265]; Victoria International Container Terminal Ltd v Lunt (2021) 95 ALJR 363 at 369 [21]-[22], 373 [43]-[44]; 388 ALR 376 at 54 Malloch v Aberdeen Corporation [1971] 1 WLR 1578 at 1595; [1971] 2 All ER 1278 at 1294; Locabail International Finance Ltd v Agroexport [1986] 1 WLR 657 at 664-665; [1986] 1 All ER 901 at 907. (1999) 198 CLR 380 at 393 [25]. Edelman approach, the latter of which had once been preferred by Lord Nicholls of Birkenhead in dissent56. The mere prospective event of giving a judgment by the Federal Court is not a process that was, or could have been, frustrated or inhibited by Mr Huang's removal of his assets from Australia. Summary judgment in favour of the Deputy Commissioner of Taxation was granted57. The presence of Mr Huang's assets in the People's Republic of China ("the PRC") and Hong Kong had no bearing on the giving of judgment. The purpose of preventing the frustration or inhibition of the process of the court includes a purpose of "preserving the efficacy of the execution which would lie against the actual or prospective judgment debtor"58. In this case, there is no doubt that there was jurisdiction to make a freezing order in relation to Mr Huang's assets in Australia in order to prevent the enforcement process being frustrated or inhibited. It is thus unsurprising that Mr Huang did not seek to oppose the making of such a freezing order. In many other cases it might be a very simple exercise for an applicant to point to evidence of the ability to obtain enforcement or reciprocal enforcement of judgments to justify a concern that the enforcement process of the court, including that reciprocity, could be frustrated or inhibited59. Further, where there is evidence that a defendant might have assets in other, perhaps even unknown, jurisdictions, a worldwide freezing order might be appropriate to preserve any realistic prospect of enforcement in foreign jurisdictions. But, in this case, since there was no realistic possibility of any enforcement of the prospective judgment against Mr Huang in either the PRC or Hong Kong, a freezing order over his assets in those jurisdictions could not have the purpose of preventing or frustrating the 56 Broad Idea International Ltd v Convoy Collateral Ltd [2021] UKPC 24 at [1]-[2] read with [36], [212]-[213], citing the reasons of Lord Nicholls in Mercedes Benz AG v Leiduck [1996] AC 284. 57 Deputy Commissioner of Taxation v Huang [2019] FCA 2122. 58 Cardile v LED Builders Pty Ltd (1999) 198 CLR 380 at 393 [25]. 59 See, eg, Agreement between the Government of Australia and the Government of the United Kingdom of Great Britain and Northern Ireland providing for the Reciprocal Recognition and Enforcement of Judgments in Civil and Commercial Matters [1994] ATS 27; Trans-Tasman Proceedings Act 2010 (Cth) and Trans-Tasman Proceedings Act 2010 (NZ); Foreign Judgments Act 1991 (Cth), s 5 read with Foreign Judgments Regulations 1992 (Cth), Schedule, recognising reciprocal arrangements with superior courts of, eg, France (French Republic), Gibraltar, the Republic of Korea, Tonga, Tuvalu, and Western Samoa. Edelman enforcement processes of the Federal Court. Indeed, it could have the opposite effect. By complying with the order, Mr Huang might maintain those assets in the PRC or Hong Kong rather than moving them to any jurisdiction where there was a realistic prospect of enforcement against them. In some cases, an enforcement process of the court that might be frustrated or inhibited is the process of appointing an equitable receiver. If an applicant alleges this to be the case, the applicant must show that there is a realistic possibility that an equitable receiver might be appointed before a freezing order could be made for the purpose of preventing the frustration or inhibition of the equitable receivership. Before the primary judge in this case, there was no evidence or submission to support the possibility of the appointment of an equitable receiver, nor any evidence or submission that any equitable receiver would have any realistic possibility of recovery from assets in the PRC or Hong Kong. The Deputy Commissioner of Taxation submitted that the in personam nature of a freezing order meant that it should be capable of application anywhere in the world. This submission is based upon an erroneous conflation of all the different dimensions of jurisdiction60. Merely because a court has personal jurisdiction, in other words jurisdiction over a person, does not mean that it has unlimited jurisdiction to make any orders against that person. As Hoffmann J said in Bayer AG v Winter [No 2]61, "[t]here are territorial limits to the effectiveness" of the orders of the court and, in foreign jurisdictions, the effectiveness of such orders depends on the willingness of the foreign court, or at least a realistic possibility that the foreign court might be willing, to enforce the court's orders. I would dismiss the appeal with costs. 60 Plaintiff S164/2018 v Minister for Home Affairs (2018) 92 ALJR 1039 at 1041 [6]; 361 ALR 8 at 10. [1986] FSR 357 at 362.

HIGH COURT OF AUSTRALIA P.T. GARUDA INDONESIA LTD APPELLANT AND AUSTRALIAN COMPETITION & CONSUMER COMMISSION RESPONDENT P.T. Garuda Indonesia Ltd v Australian Competition & Consumer Commission [2012] HCA 33 7 September 2012 ORDER Appeal dismissed with costs. On appeal from the Federal Court of Australia Representation J T Gleeson SC with C H Withers for the appellant (instructed by Norton White) S J Gageler SC, Solicitor-General of the Commonwealth with T M Howe QC and D J Roche for the respondent (instructed by Australian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS P.T. Garuda Indonesia Ltd v Australian Competition & Consumer Commission Public international law – Foreign State immunity – Sections 11(1) and 22 of Foreign States Immunities Act 1985 (Cth) ("Act") together provide that a separate entity of a foreign State is not immune from jurisdiction in a proceeding that concerns a "commercial transaction" – Respondent commenced proceedings against appellant for conduct allegedly contrary to Pt IV of Trade Practices Act 1974 (Cth) – Whether appellant immune under Act from exercise of jurisdiction – Whether civil penalty proceeding concerns a "commercial transaction". Words and phrases – "commercial transaction", "conferral of jurisdiction", "jurisdiction", "sovereign immunity ". Constitution, s 51(xxix). Foreign States Immunities Act 1985 (Cth), ss 3(1), 9, 10, 11, 22, 38, 40. Judiciary Act 1903 (Cth), s 39B. Trade Practices Act 1974 (Cth), Pt IV. FRENCH CJ, GUMMOW, HAYNE AND CRENNAN JJ. The appellant ("Garuda") argued this appeal on the uncontested footing that it is a "foreign corporation" within the meaning of s 51(xx) of the Constitution. The controversy turns on its character as an emanation of the Republic of Indonesia. Ninety five point five per cent of the issued shares in Garuda are owned directly by the Republic of Indonesia, the minority shareholding is held by government controlled corporations associated with Indonesian airports, and at the relevant times four of the five members of its Board of Commissioners were senior officials of the Indonesian government. That state of affairs is said to attract Pt II of the Foreign States Immunities Act 1985 (Cth) ("the Act") and thereby to render Garuda "immune" from the exercise of jurisdiction of the Federal Court of Australia in a proceeding for contravention of Pt IV of the Trade Practices Act 1974 (Cth) ("the TPA")1 instituted against it in 2009 by the respondent ("the ACCC"). A judge of the Federal Court (Jacobson J) dismissed a motion by Garuda that the proceeding be stayed or dismissed2. The Full Court (Lander, Greenwood and Rares JJ) granted Garuda leave to appeal but dismissed the appeal3. For the reasons which follow the appeal by Garuda to this Court should be dismissed. The common law In the Restatement Third of the Foreign Relations Law of the United States, adopted in 19864, it is said with reference to the rule of absolute immunity and the development of a more restrictive view of immunity: 1 Part IV of the TPA is now embedded in Pt IV, Div 2 of the Competition and Consumer Act 2010 (Cth) but the TPA continues to apply to unconcluded proceedings: Item 7 of Sched 7 to the Trade Practices Amendment (Australian Consumer Law) Act (No 2) 2010 (Cth). 2 Australian Competition and Consumer Commission v P.T. Garuda Indonesia Ltd (2010) 269 ALR 98. 3 P.T. Garuda Indonesia Ltd v Australian Competition and Consumer Commission (2011) 192 FCR 393. 4 Restatement of the Law: the Foreign Relations Law of the United States, 3d, (1986), vol 1, Ch 5, Sub-Ch A. Crennan increasingly engaged "Until the twentieth century, sovereign immunity from the jurisdiction of foreign courts seemed to have no exceptions. However, as governments state-trading and various commercial activities, it was urged that the immunity of states engaged in such activities was not required by international law, and that it was undesirable: immunity deprived private parties that dealt with a state of their judicial remedies, and gave states an unfair advantage in competition with private commercial enterprise." To this it may be added that in Playa Larga (Owners of cargo lately laden on board) v I Congreso del Partido (Owners)5 Lord Wilberforce observed that the "restrictive theory" had developed from the willingness of states to enter into commercial and other private law transactions and added: "It appears to have two main foundations: (a) It is necessary in the interest of justice to individuals having such transactions with states to allow them to bring such transactions before the courts. (b) To require a state to answer a claim based upon such transactions does not involve a challenge to or inquiry into any act of sovereignty or governmental act of that state. It is, in accepted phrases, neither a threat to the dignity of that state, nor any interference with its sovereign functions." The scheme of the Act The Act was preceded in 1984 by a comprehensive Report6 ("the Report") by The Law Reform Commission ("the LRC")7. In Ch 2 of the Report, the LRC traced the development of common law doctrine from the rule of absolute immunity to a more restrictive view of immunity. The Report followed the enactment of legislation in the United States and the United Kingdom and preceded that in Canada, to which reference will be made below. The Outline contained in the Explanatory Notes for the proposed legislation, which is contained in Appendix A to the Report, identified the purpose of the proposed Australian legislation as being to reflect the more restrictive view of the common law immunity which had been taken in other countries and adopted in legislation. [1983] 1 AC 244 at 262. 6 Australian Law Reform Commission, Foreign State Immunity, Report No 24, 7 Professor James Crawford was the Commissioner in Charge. Crennan Part II of the Act (ss 9-22) is headed "Immunity from jurisdiction". These provisions do not affect any immunity or privilege conferred by or under other federal laws including the Consular Privileges and Immunities Act 1972 (Cth), the Defence (Visiting Forces) Act 1963 (Cth), and the Diplomatic Privileges and Immunities Act 1967 (Cth). This is the effect of s 6 of the Act. However, the general provision in s 9 is exhaustive of the common law and indicates that statute provides the sole basis for foreign state immunity in Australian courts8. This is an important consideration for Garuda in this litigation. It is only by bringing itself within the operation of the Act that Garuda can establish a claim to immunity. Section 9 provides: "Except as provided by or under this Act, a foreign State is immune from the jurisdiction of the courts of Australia in a proceeding." What is "a foreign State" within the meaning of s 9 and by what means is it to be identified? The term "foreign State" is defined in s 3(1) so as to identify "an independent sovereign state" and "a separate territory (whether or not it is self-governing) that is not part of an independent sovereign state". Section 40 gives effect to what has been called "the one voice principle" respecting foreign State recognition9. A certificate under s 40 by the responsible Minister that a specified country is, or was on a specified day, "a foreign State", or that a specified territory is or is not, or was or was not, part of a foreign State, is admissible as evidence of the facts and matters stated in it; moreover, the certificate is conclusive of those facts and matters. The conferral of immunity by s 9 is expressly subject to other provisions made by the Act. The critical provision is s 11(1): 8 A similar point, with reference to the United States legislation, the Foreign Sovereign Immunities Act of 1976, 28 USCS §§1602-1611, was made by the Supreme Court in Argentine Republic v Amerada Hess Shipping Corp 488 US 428 at 434, 443 (1989). Cf, with respect to an ambiguity in the scheme of the State Immunity Act 1978 (UK), the doubts expressed by Lord Millett in Holland v Lampen-Wolfe [2000] 1 WLR 1573 at 1584-1585; [2000] 3 All ER 833 at 843-844. 9 See Chow Hung Ching v The King (1948) 77 CLR 449 at 467; [1948] HCA 37; Collins, "Foreign Relations and the Judiciary", (2002) 51 International and Comparative Law Quarterly 485 at 487-493; Triggs, International Law, 2nd ed Crennan "A foreign State is not immune in a proceeding in so far as the proceeding concerns a commercial transaction." (emphasis added) The phrase "in so far as" indicates that, as to part, the proceeding may not concern a commercial transaction. The present appeal, however, has been argued on an "all or nothing" basis. At common law, a question would be presented whether Garuda could be identified with Indonesia as a "foreign State" for the purposes of s 11(1)10. However, by force of the specific provision made by s 22, s 11(1) applies to "a separate entity of a foreign State". The term "separate entity" is relevantly defined in s 3(1) as a body corporate, not established under Australian law, which is an agency or instrumentality of a foreign State but is not a department or organ of the executive government thereof. No provision is made by s 40 for the issue by the Minister of a certificate respecting status as a "separate entity". A claim to "immunity" from "jurisdiction" will be a matter "arising under" a federal law, within the meaning of s 76(ii) of the Constitution, and thus attract the exercise of federal jurisdiction. The subject matter of Pt II of the Act itself relates to the conduct of foreign relations and so to "external affairs" within the meaning of s 51(xxix) of the Constitution. There appears to be no dispute respecting these basic propositions. "Immunity" from "jurisdiction" However, something more should be said immediately concerning the term "jurisdiction", to identify that from which Garuda claims "immunity" under the Act. "Jurisdiction" is a generic term used in a variety of senses, some of which relate to matters of geography, some to persons and procedures, and others to constitutional and judicial structures and powers such as those sourced in Ch III of the Constitution. 10 Rahimtoola v Nizam of Hyderabad [1958] AC 379 at 393-394; Baccus SRL v Servicio Nacional Del Trigo [1957] 1 QB 438 at 466-468, 472; Grunfeld v United States of America [1968] 3 NSWR 36 at 37. Crennan It was said in the joint reasons in Lipohar v The Queen11 that: "'Jurisdiction' may be used (i) to describe the amenability of a defendant to the court's writ and the geographical reach of that writ, or (ii) rather differently, to identify the subject matter of those actions entertained by a particular court, or, finally (iii) to locate a particular territorial or 'law area'12 or 'law district'13." Thus, a court may be seised of jurisdiction in the sense of the subject matter of a particular proceeding, whether it be an action in contract or tort at common law or, as here, for contravention of a statutory norm of conduct, or it be an appellate process of a particular kind, such as that identified in s 73 of the Constitution. Because, as Katz J pointed out in Khatri v Price14, any Australian court is a court of limited jurisdiction in this sense, it has been said that the court must be satisfied that its jurisdiction has been properly invoked. So, in Cockle v Isaksen15 this Court entertained argument by an intervener challenging the competency of an appeal in circumstances where both parties accepted that the appeal was competent. However, in s 9 and elsewhere in the Act the term "jurisdiction" is used not to identify the subject matter of a proceeding, but the amenability of a defendant to the process of Australian courts16. The notion expressed by the term "immunity" is that the Australian courts are not to implead the foreign State, that is to say, will not by their process make the foreign State against its will a party 11 (1999) 200 CLR 485 at 517 [79]; [1999] HCA 65. See also Minister for Immigration and Multicultural and Indigenous Affairs v B (2004) 219 CLR 365 at 394-395 [68]-[71]; [2004] HCA 20. 12 An expression used by the Court in Laurie v Carroll (1958) 98 CLR 310 at 331; [1958] HCA 4 with respect to New South Wales and Victoria. See also Breavington v Godleman (1988) 169 CLR 41 at 77, 97, 107; [1988] HCA 40. 13 An expression used by Wilson and Gaudron JJ in Breavington v Godleman (1988) 169 CLR 41 at 87. 14 (1999) 95 FCR 287 at 289-290. 15 (1957) 99 CLR 155 at 161; [1957] HCA 85. 16 See Mobil Oil Australia Pty Ltd v Victoria (2002) 211 CLR 1 at 23 [10], 35 [53]; [2002] HCA 27. Crennan to a legal proceeding17. Thus, the immunity may be understood as a freedom from liability to the imposition of duties by the process of Australian courts18. In the Report, under the heading "Foreign State Immunity not Immunity from Substantive Law", the LRC emphasised that in this frame of discourse the term "immunity from jurisdiction" is not concerned with the authority enjoyed by courts with respect to particular subject matters and parties19. Rather, the term reflects the common law antecedents explained by Dixon J in Chow Hung Ching v The King20. His Honour referred to the authority of the executive branch to bind the nation in the conduct of affairs with other nations and then referred to the "recognition and effect" which the common law gave to "the immunity or privilege from local jurisdictions and laws" which is accorded by the executive to the sovereigns of friendly foreign nations. The term "privilege" better conveys the notion that the special position so enjoyed with respect to curial process is not absolute but may be waived by the party entitled to the privilege. Section 10 of the Act provides that a foreign State is not immune in a proceeding to which it has submitted to the jurisdiction in accordance with that section; s 22 extends the operation of s 10 to entities such as Garuda. It has been said that while the immunity of the domestic sovereign was "based on the historic principle that no court has power to command the King", that of a foreign sovereign is founded, as a matter of favour and of comity between nations, on an implied consent "to a relaxation of the complete jurisdiction which each [sovereign] naturally enjoys within his own territory"21. Nevertheless, some analogy is provided by the character in English common law of Crown immunity in respect of actions in contract and tort. Did the immunity not only deny adjudication of claims against the Crown but go further and deny the very existence of the contract or commission of the wrong? The issue was resolved by acceptance by the common law that a contract had been made and 17 Compania Naviera Vascongado v SS Christina [1938] AC 485 at 489-490; Van Heyningen v Netherlands Indies Government [1949] St R Qd 54 at 60. 18 Stone, Legal System and Lawyers' Reasonings, (1964) at 145-147. 19 Australian Law Reform Commission, Foreign State Immunity, Report No 24, 20 (1948) 77 CLR 449 at 477-478. 21 Ulen & Co v Bank Gospodarstwa Krajowego (National Economic Bank) 24 NYS 2d 201 at 204 (1940). Crennan broken and a wrongful act committed, but the immunity rendered imperfect the rights thereby engendered in the plaintiff22. Section 38 of the Act confers a power, upon application, to set aside a judgment, order or process, as follows: "Where, on the application of a foreign State or a separate entity of a foreign State, a court is satisfied that a judgment, order or process of the court made or issued in a proceeding with respect to the foreign State or entity is inconsistent with an immunity conferred by or under this Act, the court shall set aside the judgment, order or process so far as it is so inconsistent." Further, special provision is made by s 27 for the entry of default judgments. A judgment in default of appearance shall not be entered against a foreign State or against a "separate entity" of a foreign State unless the court is satisfied that, in the proceeding, the foreign State or separate entity is not immune. If the foreign State or separate entity has appeared and waived any immunity, or has asserted its immunity, the issue of immunity will have either disappeared or fallen for adjudication. If there is no appearance, then it will be for the court to be satisfied under s 27 as to the absence of immunity before entry of any default judgment which is sought. It is not a correct construction of the Act that even without an application under s 38 to set aside service, or an application under s 27 for a default judgment, the court must of its own motion satisfy itself that the defendant could not establish immunity23. The proceeding by the ACCC It is convenient to say something more respecting the elements of the claim pleaded by the ACCC in that proceeding. The ACCC alleged that Garuda was a body corporate incorporated pursuant to the laws of Indonesia which carried on business in Australia, provided air freight services to and from Australia, was registered as a foreign company pursuant to Pt 5B.2 of the Corporations Act 2001 (Cth), and was both a trading corporation and a foreign corporation within the meaning of s 4 of the TPA. 22 The Commonwealth v Mewett (1997) 191 CLR 471 at 542-545; [1997] HCA 29. 23 cf Zhang v Zemin (2010) 79 NSWLR 513 at 523, 541-542. Crennan The substance of the case pleaded was that Garuda and other airlines entered (between into anti-competitive arrangements or understandings themselves) to impose surcharges on commercial freight services to Australia; pursuant to those anti-competitive arrangements or understandings, Garuda and other airlines imposed such surcharges on commercial freight services to Australia from Indonesia and Hong Kong; and the anti-competitive conduct of Garuda was intended to be implemented, and was in fact implemented, by way of prices charged in contracts entered into by Garuda with its customers. The ACCC relied upon s 86 of the TPA and s 39B(1A)(c) of the Judiciary Act 1903 (Cth) for the conferral of jurisdiction on the Federal Court. The ACCC claimed relief in respect of alleged price fixing, market sharing and other anti-competitive conduct between October 2001 and September 2006 in contravention of s 45 of the TPA, read with s 45A. The remedies sought were injunctive relief under s 80 of the TPA, declaratory relief under s 21 of the Federal Court of Australia Act 1976 (Cth), and pecuniary penalties pursuant to s 76 of the TPA. Modern regulatory laws have created various contraventions which are not dealt with by criminal process24. The recovery of pecuniary penalties was a remedy well established in federal law when the Act was introduced. In addition to the provision made in s 76 of the TPA, provision for recovery of penalties for breaches of awards was made by s 119 of the Conciliation and Arbitration Act 1904 (Cth), and civil penalties had been imposed under the customs legislation since the enactment of the Customs Act 1901 (Cth), although there was controversy as to their proper characterisation25. The injunction sought against Garuda was in the following terms: "An injunction restraining the respondent for a period of seven years from the date of the order from making, arriving at, or giving effect to, any contract, arrangement or understanding with any of its competitors for the supply of air freight services, containing provisions which have the effect of fixing, controlling or maintaining the price or any part of the price at which it or any of them will supply those services in competition with each other unless: 24 Australian Law Reform Commission, Principled Regulation, Federal, Civil and Administrative Penalties in Australia, Report No 95, (2002) at [2.16]. 25 Chief Executive Officer of Customs v Labrador Liquor Wholesale Pty Ltd (2003) 216 CLR 161; [2003] HCA 49. Crennan the said contract, arrangement or understanding does not involve or relate to the supply of air freight services to or from Australia; the said contract, arrangement or understanding is necessary for the purpose of interlining between two or more carriers in the course of supplying air freight services; or the respondent is specifically authorised to do so under section 88 [of the TPA]." The motion filed by Garuda on 5 November 2009 sought an order that the proceeding be dismissed or stayed. On the appeal to this Court, Garuda seeks an order that service be set aside pursuant to s 38 of the Act. Section 38 would authorise that course if this Court were satisfied that the Federal Court process was inconsistent with an immunity conferred by or under the Act. The issue on the appeal Reference already has been made to the provisions of Pt II of the Act and to the general conferral of immunity upon a foreign State from the jurisdiction of Australian courts in a "proceeding". This term does not include "prosecution for an offence" (s 3(1)). In ordinary parlance "prosecution" identifies the instigation and conduct of a curial proceeding which commences with an accusation of a crime and involves the trial of that accusation concluding with a conviction or acquittal, and may include a committal proceeding26. The committal is a sui generis procedure but one closely related to the exercise of judicial power27. There is no indication that in s 3(1) "prosecution" is used in a non-technical sense28. It was not in the interests of Garuda to submit that the proceeding by the ACCC, at least in so far as pecuniary penalties were sought under s 76 of the TPA, was a "prosecution", and thus not within the scope of the immunity provisions of the Act, and the ACCC did not submit that it was engaged in a prosecution of Garuda. 26 Shepherd v Griffiths (1985) 7 FCR 44 at 51-53. 27 R v Murphy (1985) 158 CLR 596 at 616; [1985] HCA 50. 28 cf Mohamed Amin v Jogendra Kumar Bannerjee [1947] AC 322 at 331. Crennan Jacobson J held that, in the absence of sufficient evidence, Garuda was not a "separate entity" within the meaning of the Act. The Full Court disagreed and decided that Garuda was a "separate entity". However, the Full Court held that the proceeding fell within the exclusion provision in s 11, as it concerned a "commercial transaction". It is that holding which Garuda challenges in this Court. There is no notice of contention by the ACCC, and it argued the appeal on the footing that Garuda was a "separate entity". The precise issue, as identified correctly by counsel for the ACCC in this Court, looks first to the application to foreign corporations of the substantive norms of conduct required by Pt IV of the TPA, secondly to the provisions conferring jurisdiction on the Federal Court to entertain the proceeding by the ACCC for contravention of those norms by a foreign corporation, and then asks to what extent the exercise of this jurisdiction is qualified with respect to that foreign corporation by engagement of the immunity provisions of the Act. Foreign authorities Before the Full Court there was extensive citation of decisions from other jurisdictions with legislation comparable to the Act. These included the decision of the Supreme Court of the United States in Saudi Arabia v Nelson29, and that of the Supreme Court of Canada in Kuwait Airways Corporation v Republic of Iraq30. In this Court reference also was made to the decision of the Supreme Court of the United Kingdom in NML Capital Ltd v Republic of Argentina31. However, it appeared to be common ground that there was limited assistance to be derived from those decisions. The legislation in the United States, the United Kingdom and Canada is differently expressed and has been applied in different circumstances. Two further points should, however, be made. The first is that both Kuwait Airways and NML Capital concerned the recognition in the forum of judgments obtained elsewhere against a foreign State. No consideration is given in these reasons to any issues concerning the interaction between the Act and the Foreign Judgments Act 1991 (Cth). 30 [2010] 2 SCR 571. Crennan Secondly, in the United States, issues of foreign state immunity have, on occasion, become entangled with other doctrines. One is the "political question doctrine" which derives from the constitutional requirement in Art III of a "Case" or "Controversy"32 and denies justiciability to the review of the foreign policy of the "political branches" of government. Another is the "act of State doctrine" developed from the dictum of Fuller CJ in Underhill v Hernandez that "the courts of one country will not sit in judgment on the acts of the government of another done within its own territory"33. In Spectrum Stores Inc v Citgo Petroleum Corp34, the Court of Appeals for the Fifth Circuit, in affirming the decision of the District Court, held that it was "the political question" and "act of state" doctrines which denied the justiciability of a claim by gasoline retailers of price fixing, in contravention of the Sherman Act and the Clayton Act, by United States firms working in concert with OPEC member nations35. On a motion for summary dismissal, the District Court had declined to consider the application of the Foreign Sovereign Immunities Act of 1976 ("FSIA")36. The Court of Appeals observed37: "We note that a 'commercial activity' exception to this sovereign activity may obtain with respect to application of the FSIA when, for example, a foreign sovereign enters into 'a joint venture contract with oil companies for the exploration, production, and sale on the world market of oil and gas,' thus acting 'not as a regulator of a market, but in the manner of a private player within it.'38 However, we agree with the Ninth 32 Baker v Carr 369 US 186 at 198 (1962); Chemerinsky, Federal Jurisdiction, 5th ed 33 168 US 250 at 252 (1897). See further, Moti v The Queen (2011) 86 ALJR 117 at 129-130 [46]-[52]; 283 ALR 393 at 406-408; [2011] HCA 50. 34 632 F 3d 938 at 951 (2011). 35 See also Areeda and Hovenkamp, Anti-Trust Law, 3rd ed (2006), vol 1B, ¶274; Fugate, Foreign Commerce and the Anti-Trust Laws, 5th ed (1996), vol 1, §2.26. 36 In re Refined Petroleum Products Antitrust Litigation 649 F Supp 2d 572 at 598 37 632 F 3d 938 at 955, fn 16 (2011). 38 Connecticut Bank of Commerce v Republic of Congo 309 F 3d 240 at 264 (5th Cir 2002) (internal quotation marks and citations omitted). Crennan Circuit that, under current precedents, '[t]he act of state doctrine is not diluted by the commercial activity exception which limits the doctrine of sovereign immunity.'39 Neither the Supreme Court nor any circuit have adopted a commercial activity exception to the act of state doctrine, and we decline to do so today." Conclusions The term "commercial transaction" as it appears in s 11(1) is defined in s 11(3) as meaning: "a commercial, trading, business, professional or industrial or like transaction into which the foreign State has entered or a like activity in which the State has engaged and, without limiting the generality of the foregoing, includes: a contract for the supply of goods or services; an agreement for a loan or some other transaction for or in respect of the provision of finance; and a guarantee or indemnity in respect of a financial obligation; but does not include a contract of employment or a bill of exchange." The express statement in s 11(3) "without limiting the generality of the foregoing" precludes resort to the ejusdem generis principle to limit the generality of the preceding words in the definition of "commercial transaction". In Leon Fink Holdings Pty Ltd v Australian Film Commission40, Mason J said of the statute under consideration there: "In this case the words 'without limiting the generality of the foregoing' evince an intention that the general power should be given a construction that accords with the width of the language in which it is expressed and that this construction is not to be restricted by reference to the more specific character of that which follows. The clause therefore operates to negative the restrictive implication which might otherwise have been 39 Int'l Ass'n of Machinists & Aerospace Workers v OPEC 649 F 2d 1354 at 1360 (9th Cir 1981) (noting that the two doctrines "address different concerns and apply in different circumstances"). 40 (1979) 141 CLR 672 at 679; [1979] HCA 26. Crennan derived from the presence of the specific power to lend contained in par (a)." Section 11(1) denies the immunity in a proceeding, otherwise conferred on an entity such as Garuda by s 9 and s 22, by stating that there is no immunity "in so far as" this proceeding "concerns" what is "a commercial transaction". The term "concerns" is not further explicated by the text of the Act41. Garuda accepts that the proceeding may involve an investigation "at an evidentiary level" into contracts for carriage of freight by Garuda, from which to infer purpose or likely anti-competitive effect, or the giving effect to the impugned arrangement or understanding within the meaning of the provisions of the TPA. However, Garuda submits that it is critical for the operation of s 11(1) of the Act that the ACCC does not plead the terms of any such contract, nor seek any remedy by way of variation, rescission, compensation or otherwise with respect to any of the contracts for the carriage of freight by Garuda. Further, it is said to be critical that no party to any such contract, or person claiming to have suffered loss by reason thereof, joins in the proceeding. In sum, the submission for Garuda is that the proceeding does not seek to vindicate any "private law right" in respect of any freight contract and that, absent this, s 11(1) of the Act does not apply to deny immunity. This postulated dichotomy between private and public law as controlling the meaning of "concerned" in s 11(1) should not be accepted. The definition of "commercial transaction" fixes upon entry and engagement by the foreign State. It does not have any limiting terms which would restrict the immunity conferred by s 9 and s 22 to a proceeding instituted against the foreign State by a party to the commercial transaction in question. Further, it should be emphasised that the definition does not require that the activity be of a nature which the common law of Australia would characterise as contractual. The arrangements and understandings into which the ACCC alleges Garuda entered were dealings of a commercial, trading and business character, respecting the conduct of commercial airline freight services to Australia. The definition of a "commercial transaction" is satisfied. 41 The provision in FSIA, 28 USCS §1605(a)(2), asks whether "the action is based upon a commercial activity"; s 3(1) of the State Immunity Act 1978 (UK) denies immunity "as respects proceedings relating to ... a commercial transaction"; and in Canada s 5 of the State Immunity Act RSC 1985, c S-18, s 3, is in similar terms to the United Kingdom provision. Crennan The Federal Court proceeding "concerned" a commercial transaction, within the meaning of s 11(1), in an immediate sense. This is apparent from the relief sought. The ACCC seeks declarations that the arrangements and understandings contravene Australian law, pecuniary penalties, and injunctive relief against the giving of effect to the arrangements and understandings. Orders The appeal should be dismissed with costs. HEYDON J. This appeal concerns the construction of the Foreign States Immunities Act 1985 (Cth) ("the Act"). Background The issue turns on the meaning of s 11 of the Act. That issue is to be determined in the context of an application for relief arising from alleged contraventions of s 45 of the Trade Practices Act 1974 (Cth) ("the TP Act"). That application has been brought in the Federal Court of Australia. The Full Court of the Federal Court of Australia found that the appellant was a "separate entity", as that phrase is defined in s 3(1) of the Act. It was thus an agent or instrumentality of Indonesia, but not an organ of Indonesia itself. The respondent does not challenge that finding. Nor, for its part, does the appellant contend that the proceeding in the Federal Court of Australia is a prosecution. Thus it is common ground that the application in the Federal Court of Australia brought by the respondent against the appellant is a "proceeding", as that word is defined in s 3(1) of the Act. Section 9 confers a general immunity from jurisdiction on foreign States. Section 22 extends that immunity to separate entities of those States. It follows that by reason of ss 9 and 22 of the Act, the appellant is immune from the jurisdiction of the Federal Court of Australia in the proceeding, unless the proceeding "concerns a commercial transaction" within the meaning of s 11(1), as defined in s 11(3)42. The Statement of Claim filed by the respondent in the proceeding alleges that the appellant has made numerous arrangements or arrived at numerous understandings containing particular provisions. It does not allege that these arrangements or understandings are contracts. Hence the alleged arrangements or understandings do not of themselves answer the description given in s 11(3)(a) – "a contract for the supply of goods or services". And the proceeding does not concern the commercial transactions described in s 11(3)(b) (agreements to do with the provision of finance) or s 11(3)(c) (guarantees or indemnities in respect of certain financial obligations). The respondent's case is divisible into two limbs. The first limb is that the alleged arrangements or understandings called for the appellant to enter contracts with its customers to provide air freight services on particular terms, which terms are reflected in the contracts the appellant actually entered. The second is that the examples given in pars (a)-(c) of s 11(3) do not limit the generality of the words which precede them. Among those words are "a commercial, trading … or like transaction". Those words indicate that "commercial transactions" extend 42 See above at [11] and [37]. beyond contractual transactions. The alleged arrangements or understandings are therefore "commercial transactions" even though they are not pleaded as contracts. Each of these two limbs support the submission that the proceeding concerns a "commercial transaction". That submission is correct. It is convenient to take the two limbs in turn. The first limb: commercial transactions as described in s 11(3)(a) The proceeding "concerns a commercial transaction" within the meaning of s 11(3)(a) for the following reasons. What the Statement of Claim alleges. The Statement of Claim alleges that the appellant breached two provisions of the TP Act – ss 45(2)(a)(ii) and 45(2)(b)(ii). Section 45(2)(a)(ii) relevantly proscribed the making of an arrangement, or the arriving at an understanding, where a provision of the arrangement or understanding has the purpose, or would have or be likely to have the effect, of substantially lessening competition in a market. Section 45(2)(b)(ii) proscribed giving effect to a provision of an arrangement or understanding if that provision has the purpose of, or has or is likely to have the effect of, substantially lessening competition in a market. The Statement of Claim alleges that s 45(2)(a)(ii) was contravened because the appellant allegedly made arrangements or arrived at understandings containing provisions by which the appellant would impose surcharges on, or otherwise fix a component of the price for, the supply of air freight services from Indonesia to Australia under contracts to be entered between the appellant and its customers. The Statement of Claim also alleges that s 45(2)(b)(ii) was contravened. It alleges that the appellant gave effect to the provisions of the arrangements or understandings by imposing those surcharges in air freight services contracts which the appellant entered with its customers. Those contracts are contracts for the supply of services. They are therefore "commercial transactions" because they answer the description in s 11(3)(a). In part, the Federal Court proceeding "concerns" these commercial transactions. Had they not been entered, no s 45(2)(b)(ii) contravention could be established. Section 45(2)(b)(ii) required that the provisions of the arrangement or understanding be put into effect. The fact that the proceeding concerns the air freight services contracts between the appellant and its customers in this way does not emerge clearly from the Statement of Claim itself. But it emerges clearly from particulars which the respondent has supplied by letter. The Statement of Claim, dated 2 September 2009, alleges that on or about 9 May 2003, the appellant made an arrangement or arrived at an understanding with other international airlines containing a provision that required the parties to impose or re-impose fuel surcharges of specified amounts "on the supply of air freight services from Indonesia" to particular destinations (emphasis added). The Statement of Claim alleges that the provision: "had the purpose and had the effect and was likely to have the effect of fixing or controlling or maintaining a component of the price charged by [the appellant] and a component of the price charged by the other parties to the [arrangement or understanding] for the supply of air freight services including the supply of air freight services to Australia in competition with each other". (emphasis added) The Statement of Claim alleges that s 45A of the TP Act applied to the provision. The Statement of Claim also alleges that the appellant "gave effect to the provision … by imposing a fuel surcharge from Indonesia" of specified amounts "on the supply of air freight services from Indonesia" to the particular destinations (emphasis added). What the particulars allege. In terms, the allegations in the Statement of Claim say nothing about contracts. But by letter dated 21 January 2010, the respondent supplied the following particulars: "In relation to the whole of the Statement of Claim, references to the provision/supply of air services should be understood as referring to the provision of such services pursuant to fee-for-service contracts. References to the imposition, re-imposition, levying, application or maintenance of particular surcharges should be understood as referring to the imposition, re-imposition, levying, application or maintenance of such surcharges pursuant to fee-for-service contracts. References to prices and pricing should be understood as references to prices/pricing of services provided/supplied (or to be provided/supplied) pursuant to fee-for-service contracts." (emphasis added) These particulars were filed after the appellant had filed a notice of motion seeking an order dismissing or staying the proceeding. The appellant's arguments on the first limb. The appellant referred to these particulars contemptuously as "boot-strapping". That description is apt. But the respondent is bound by the particulars. They do assist in defining the issues. And that definition of the issues is central to the question in this Court: what does the proceeding "concern"? The appellant made more substantive criticisms of the reasoning set out above43. The appellant submitted that it confuses the appellant's allegedly 43 See above at [52]-[53]. contravening conduct, namely reaching and giving effect to arrangements or understandings, with the subject matter of those arrangements or understandings. The appellant submitted that their subject matter – the duty to insert particular terms into commercial transactions, namely the contracts between the appellant and its customers – was a matter of factual background only. The appellant pointed out that the Statement of Claim does not allege breach of the contracts. The appellant also pointed out that the parties to the contracts were not parties to the proceeding. It submitted: "[C]entral to the meaning of 'commercial transaction' is a dispute between parties in contractual relations, or as to the existence of their contractual relations. The litigation contemplated by the exception is private, and its subject matter is the commercial contract or like activities sought to be enforced or set aside. The [respondent] is party to no contract or like activity. Nor is it seeking damages, or rescission, or any private law remedy directed to the contract or like activity. Instead it, a non party, with no pre-existing commercial interest, seeks to impose a penalty, foreign to general law, because of an anticompetitive understandings, contrary to s 45 of the [TP Act]." consequence of arrangements alleged the The appellant also submitted that the Statement of Claim does not plead the terms of the air freight services contracts. That last submission is without merit. The Statement of Claim pleads those terms so far as the price of air freight services is concerned. That is all that is necessary for the respondent's purposes in the proceeding. It is true that the parties to the air freight services contracts other than the appellant are not parties to the proceeding. But they do not have to be. The appellant is a party, and that is sufficient. Nor does it matter that the Statement of Claim does not allege breach of the contracts. The making of the contracts is central to the respondent's s 45(2)(b)(ii) case that the appellant gave effect to provisions of the arrangements or understandings. Indeed, certain types of breach by the appellant's customers could weaken or nullify that case. That is because they could raise a question mark over whether the appellant had in fact given effect to the provisions. It is not correct to describe the making of the contracts as merely the "subject matter" of the arrangements or understandings or as "the factual background" to the proceeding. If the contracts had not been made, half of the respondent's case – the s 45(2)(b)(ii) allegation – would collapse. The appellant accepted that its case would be weaker if the respondent had confined itself to the remedies also available to private litigants. In particular, it accepted that its case would be weaker if the respondent had merely sued for monetary remedies on behalf of persons allegedly injured by the appellant's conduct. And it accepted that its case would be weaker still if those persons had sued for damages in their own right. But the appellant submitted that even those persons would be vindicating a statutory norm of conduct which Australia seeks to apply to persons anywhere in the world to protect Australian markets, and that s 11 should not be construed to extend so widely. Cascading analysis of that kind, however, and the concessions that resulted from it, did considerably weaken the strict dichotomy between private and public litigation on which the appellant's submissions rested. The appellant's submission that a dispute between parties in a contractual relationship is central to the meaning of "commercial transaction" is also incorrect. The characterisation of an agreement as a "commercial transaction" occurs primarily at the point of time at which it is made, not at the latest moment in its history. At the inception of a transaction there is a contemplation of peaceful agreed performance, not of disputes about breach. Therefore a proceeding could concern a "commercial transaction" even though neither party was disputing the existence of the transaction or alleging breach by the other. The appellant made another, related, complaint. It was that the statutory language was too unclear to indicate that "the exceptions to immunity might subject foreign states to punishment at the suit of an Australian regulator for breach of Australian antitrust norms, contrary to international law". The appellant submitted: "[T]he Act was passed in an international context of concern about long- arm reach of US antitrust legislation threatening Australia's national interests and sovereign control over commodity exports (specifically uranium), most prominently in connection with civil proceedings in the US against and a grand jury investigation of Westinghouse. A series of Acts [led] to a 1982 agreement with the US on co-operation in antitrust matters, providing for a framework of co-operation, ultimately buttressed by the Foreign Proceedings (Excess of Jurisdiction) Act 1984. Parliament in 1985, when legislating to embody the commercial transaction exception that had developed at common law and was now reflected in statute in the UK and the US, could hardly have intended to authorise Australian Courts, at the suit of Australian regulators, to inflict punishment on foreign states for their conduct, outside Australia, said to be in breach of Australia's statutory norms of anti-trust conduct. Such a choice would have radically departed from norms of international law and courted swift retaliatory action." Orally, counsel for the appellant added that not only does the proceeding seek relief punishing Indonesia, but, by pursuing it, Australia seeks "an edict that Indonesia must not engage in defined conduct for seven years unless Indonesia comes to the Australian regulator and persuades it that there is a net public benefit to Australia." That submission refers to an exception in the injunctive relief claimed if the appellant obtains an authorisation from the respondent. To complain of "punishment" does not sit well in the mouth of a litigant that has chosen not to advance the point – probably doomed but perhaps arguable – that the proceeding is a prosecution. The appellant's remark that its impugned conduct allegedly occurred "outside Australia" overlooks a critical fact. It was conduct which allegedly involved giving effect to a provision in relation to the supply of air freight services from Indonesia to Australia. It was conduct which allegedly affected markets in Australia. Further, the appellant made no specific attempt to demonstrate that s 11 of the Act is in breach of contemporary public international law. The appellant did refer to what Lord Watson said in Huntington v Attrill44 about prosecuting crimes. But it accepted that the Federal Court case is not a prosecution. It is necessary to deal with the appellant's reliance on Australian opposition to "long arm" United States jurisdiction to support a narrow construction of s 11. The Foreign Proceedings (Excess of Jurisdiction) Act 1984 (Cth) was the result of a recommendation in a report on Australian-United States' Relations: The Extraterritorial Application of United States Laws. The report was prepared by the Parliamentary Joint Committee on Foreign Affairs and Defence. Its purpose was to propose legislation calculated to repair damaged relations between Australia and the United States45. The report noted that s 5 of the TP Act "extends to 'the engaging in conduct outside Australia by persons in relation to the supply by those persons of goods or services to persons within Australia'." But it went on: "Australia, however, unlike the United States, does not attempt to regulate foreign commerce on the basis purely of an alleged adverse effect upon Australia's trade."46 That is, the Parliamentary Joint Committee saw the United States legislation which had excited Australian opposition and prompted the enactment of the 1984 Act as reaching much further than the TP Act. The enactment of the 1984 Act was thus entirely consistent with the construction of s 11 of the Act proposed by the respondent and accepted above. The appellant stressed the coercive impact which the TP Act has on foreign States in Federal Court of Australia proceedings. A difficulty for the appellant is that it is not a foreign State. It is a "separate entity" of Indonesia. Indonesia would be immune from the jurisdiction of the Federal Court even if the 44 [1893] AC 150 at 156. See now Attorney-General (United Kingdom) v Heinemann Publishers Australia Pty Ltd (1988) 165 CLR 30 at 41-42; [1988] HCA 25. 45 See the Minister's Second Reading Speech: Australia, House of Representatives (Hansard), 1 March 1984 at 254. 46 Parliament of the Commonwealth of Australia, Joint Committee on Foreign Affairs and Defence, Australian-United States' Relations: the Extraterritorial Application of United States Laws, (1983) at [5.9]. proceeding concerned a commercial transaction because of s 11(2)47. But the appellant is not Indonesia. The appellant referred to various passages in the Australian Law Reform Commission Report on Foreign State Immunity. That report was published in 1984. It recommended that the common law and statutory rules governing foreign State immunity be replaced by a Commonwealth statute. The Act is the legislative response to that report. However, the report does not appear to isolate for consideration or to answer the precise question which this appeal raises: can a regulatory arm of one government enforce its local laws concerning commerce against an agent or instrumentality of another and sidestep the immunity created in s 9 of the Act? And what the report does say does not assist the appellant. There are passages, admittedly expressed in general terms, which suggest that no distinction between the private enforcement of private rights and State enforcement of regulatory regimes underlies s 11 of the Act. The report, after referring to certain arguments, states48: "they do not point to a single distinction between immune and non-immune cases as appropriate or necessary, whether it is a distinction between 'commercial' and 'governmental' transactions." law, or between 'private' and 'public' The report also states49: "All the recent overseas legislation applies only to civil proceedings; criminal matters are specifically excluded. It is recommended that the same position be taken in the Australian legislation. Problems arising with the application of penal or regulatory legislation to foreign states cannot be resolved through the application of any general formula, but depend on the particular legislation in question." 47 Section 11(2)(a)(i) provides: "Sub-section (1) does not apply: if all the parties to the proceeding: are foreign States or are the Commonwealth and one or more foreign States; or …". 48 Australia, Law Reform Commission, Foreign State Immunity, Report No 24, (1984) at xv. 49 Australia, Law Reform Commission, Foreign State Immunity, Report No 24, (1984) at 100-101 [161] (footnote omitted). Thus the report saw the question of whether immunity should attach to regulatory proceedings as a matter to be resolved in the relevant legislation. The relevant legislation here, the TP Act, applies to foreign corporations like the appellant. "In practice, it is unlikely that claims to immunity by separate entities will succeed, as most entities do not perform in Australia the sort of activities that entitle foreign States to immunity." "So far as a specific commercial transaction exception is concerned, the guiding principle should be that when a foreign state acts in a 'commercial' matter within the ordinary jurisdiction of local courts it should be subject to that jurisdiction." This theme was sounded again52: "The basic principle upon which the commercial transaction exception to immunity rests is that when a foreign state acts in a 'commercial' matter within the ordinary jurisdiction of local courts it should be subject to that jurisdiction." In short, the report designedly did not recommend that the Act employ any measure which would assist the appellant's arguments. Rather, it suggested that the legislature resolve the problem in other statutes with specific applications. The statute that applies here, the TP Act, does not accord agents or instrumentalities of foreign States any relevant immunity. The appellant advanced various arguments for giving the word "concerns" a narrow meaning. One argument was that "concerns" is "far from being the most expansive word that could have been used" to denote the necessary relationship between a proceeding and a commercial transaction. Another was based on statutory context. The appellant noted that s 11 was one of a series of exceptions to the general conferral of immunity in s 9 of the Act. It argued that the importance of the immunity meant that the exceptions should be construed 50 Australia, Law Reform Commission, Foreign State Immunity, Report No 24, 51 Australia, Law Reform Commission, Foreign State Immunity, Report No 24, (1984) at xviii. 52 Australia, Law Reform Commission, Foreign State Immunity, Report No 24, (1984) at 51 [90] (footnote omitted). narrowly. A third argument was that the carefully delimited exceptions should be construed sufficiently narrowly to permit their mutual harmonious operation. Let it be assumed, without deciding, that the conclusion to which these arguments are directed is correct – that "concerns" is narrow in meaning. Even so, the connection between the proceeding and the contracts by which the appellant gave effect to the provisions of the arrangements or understandings is sufficiently close to fall within the word "concerns". Whether "concerns" bears a wide or narrow meaning, there is nothing in s 11 or in any other provision of the Act to support the distinctions the appellant sought to draw between public and private rights, between proceedings brought by a regulator and proceedings brought by beneficial objects of the regulating legislation, and between specific statutory norms and general law norms. The appellant submitted that where the Act provided that it extended to public law rights and obligations the language to that effect was clear: for example, s 12(2) ("a right or obligation conferred or imposed by a law of Australia on a person as employer or employee") and s 20 ("an obligation imposed … under a provision of a law of Australia with respect to taxation"). The appellant submitted that there was no clear language to this effect in s 11. The submission must fail. Section 11 is perfectly general. Its terms are more than sufficient to capture obligations that are not of a private law character. The appellant also submitted that s 11(2)(a)(ii) indicated that a proceeding by a regulator could not "concern" a commercial transaction. That provision contemplates the possibility of the parties to a proceeding agreeing in writing that a separate entity of a foreign State may be immune in a proceeding even though the proceeding "concerns" a commercial transaction. The appellant submitted that it was impossible to contemplate the respondent agreeing in writing to give a separate entity immunity. It might be unusual, but it is possible. The respondent might enter an agreement of this kind with a separate entity in order to obtain its co-operation in pursuing litigation against other suspected contraveners. Both parties relied on particular foreign decisions. In fairness, they did not press that reliance strongly. Those decisions are of no utility in resolving the present controversy. The statutes under consideration in those decisions are insufficiently similar to the Act, and the issues under consideration in those decisions are insufficiently similar to the present issue. It is sufficient to satisfy the s 11(3)(a) description of a proceeding concerning "a contract for the supply of … services" if an element of a claim made in the relevant proceeding depends on the existence of a term in a commercial contract. Here, the respondent's s 45(2)(b)(ii) case depends on the existence of the pricing terms in the air freight services contracts between the appellant and its customers. The second limb: commercial transactions under s 11(3) more generally The second limb of the respondent's argument is correct for a similar reason. Section 11(3) is satisfied because an element of a claim made in the proceeding is the existence of terms in commercial transactions or like activities – the alleged arrangements or understandings. The function of arrangements or understandings of the kind it is said the appellant entered into is to improve the trading or commercial position of the parties, at least in the perception of those parties. The Statement of Claim alleges transactions which are extremely elaborate and complicated. They boil down to arrangements or understandings which had the purpose and effect of price fixing. The Statement of Claim alleges meetings of the minds of traders about trade. These are "trading" or "commercial" activities. They are "commercial" or "trading" transactions. That is so even though they may not have contractual force. And it is so even though they are transactions which, in both ordinary usage and legal parlance, are in restraint of trade. The expression "commercial transactions" is not limited to those transactions which promote trade. The opening words of s 11(3) are not limited to contracts. The appellant did not deny that if it and the other airlines had entered a contract allegedly in contravention of s 45, it would be a commercial transaction. If a contract in contravention of s 45 transaction, non-contractual arrangements or understandings are capable of being "a commercial, trading … transaction … or a like activity". Indeed, the appellant expressly conceded this. is capable of being a commercial The principal arguments advanced by the appellant against this second limb of the respondent's argument were considered and rejected above53. Accordingly, even if the arrangements and understandings had not been put into effect in the air freight services contracts, they would still have been "commercial transactions" within the meaning of s 11(3). Orders The submissions of the appellant must be rejected. The appeal should be dismissed with costs. 53 See above at [57]-[71].

HIGH COURT OF AUSTRALIA APPELLANT AND ZURICH FINANCIAL SERVICES AUSTRALIA LTD & ANOR RESPONDENTS Kuhl v Zurich Financial Services Australia Ltd [2011] HCA 11 4 May 2011 ORDER Appeal allowed. Set aside the orders of the Court of Appeal of the Supreme Court of Western Australia made on 24 March 2010 in favour of the first respondent and in their place order that: the appeal be allowed; the orders made by Wisbey DCJ on 22 January 2009 in favour of the first respondent be set aside; and judgment be entered against the first respondent in the amount of The first respondent pay the appellant's costs of the appeal and in the courts below. On appeal from the Supreme Court of Western Australia Representation B L Nugawela with M A Tedeschi for the appellant (instructed by Taylor Smart) J E Maconachie QC with J R Criddle and H M O'Sullivan for the first respondent (instructed by SRB Legal) J E Maconachie QC for the second respondent (instructed by Jarman McKenna) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Kuhl v Zurich Financial Services Australia Ltd Negligence – Duty of care – Appellant injured while using high-pressure vacuum hose – Injury occurred after hose passed to appellant – Supplier of hose also directed and supervised appellant – Concession by first respondent of duty of care made in court below – Whether duty of care was dependent on increased risk. Negligence – Breach – Supplier of hose failed to install break box and failed to issue instructions not to pass hose while power was on – Relevance of subsequent changes to safety systems – Whether changes inordinately expensive or disadvantageous. Negligence – Causation – Whether evidence as to precisely how injury occurred is necessary before causation can be found – Relevance of ordinary human experience – Relevance of agreement on quantum of damages. Evidence – Implied admission or circumstantial evidence permitting adverse inference – Trial judge concluded that appellant had withheld evidence in examination-in-chief – Whether trial judge erred in failing to provide reasons for that conclusion – Whether trial judge erred in failing to provide appellant with opportunity to respond to criticism. FRENCH CJ AND GUMMOW J. On 19 November 1999 the appellant ("Mr Kuhl") suffered injuries in the course of his employment with Transfield Construction Pty Ltd ("Transfield"). Pursuant to s 93E of the Workers' Compensation and Rehabilitation Act 1981 (WA)1, Mr Kuhl was barred from bringing a claim in negligence against Transfield. In the District Court of Western Australia, Mr Kuhl brought an action in negligence against WOMA (Australia) Pty Ltd ("WOMA") and Hydrosweep Pty Ltd ("Hydrosweep"), amongst other parties. Both companies were deregistered after Mr Kuhl's injury the but before he commenced proceedings. Corporations Act 2001 (Cth), in the place of WOMA and Hydrosweep stand their respective insurers, the first and second respondents. to s 601AG of Pursuant Mr Kuhl was unsuccessful in his action against both insurers before the District Court (Wisbey DCJ)2 and on appeal to the Court of Appeal of the Supreme Court of Western Australia (Martin CJ and Newnes JA; Wheeler JA dissenting)3. For the reasons given below, there was insufficient evidence to be satisfied on the balance of probabilities that there existed the relevant duty, breach or causation for Mr Kuhl to be successful in his action in negligence, and the appeal to this Court should be dismissed. The facts Mr Kuhl commenced employment with Transfield in September 1999. He cleaned reactor grid floors at a plant owned and operated by BHP Billiton in Port Hedland, Western Australia. The reactors cooked "fines", small pieces of iron ore, which changed the composition of the fines into hot briquetted iron (HBI). Mr Kuhl had the task of entering the reactors, breaking up any solidified waste material with a jackhammer or sledge hammer and then removing the accumulated fines and other waste using a vacuum. Those who undertook these tasks were colloquially known as "reactor rats". The evidence accepted by the trial judge as to the relationship between Transfield, WOMA and Hydrosweep was as follows: By November 1999, Transfield was solely responsible for cleaning out the reactors, including using the vacuum hose. A Transfield employee, known as the "hole watcher", would look through a window into the 1 Now the Workers' Compensation and Injury Management Act 1981 (WA). 2 Kuhl v Zurich Financial Services Australia Ltd [2009] WADC 4. 3 Kuhl v Zurich Financial Services Australia Ltd (2010) 194 IR 74. reactor whilst it was being cleaned to monitor the "reactor rats" and test gas levels. Transfield also had supervisors on site and those supervisors would allocate the work to each employee and conduct meetings to discuss, amongst other things, safety prior to each shift. (b) WOMA provided a vacuum truck, the vacuum hose and other equipment relevant to the vacuuming system. WOMA would set up the equipment and supply two operators for the system; one to operate the truck, the other to check and maintain the line. WOMA would also assist in clearing any obstructions in the vacuum hose when Transfield employees were unable to do so. For a period in November 1999, Hydrosweep supplied a vacuum truck and two operators to WOMA for use at WOMA's direction. The vacuum hose used at the time of the accident was flexible, but awkward to use. It was attached to a stand pipe, or manifold, running up the side of the 128 metre tall building, which was in turn connected by hose to a vacuum truck positioned at ground level. The vertical distance from the truck to the manifold connection for the reactor in which Mr Kuhl was injured was some 32 metres. The horizontal distance from the manifold connection to that reactor's entry point is unclear, but was probably between 20-30 metres. The accident At about 4.30am on 19 November 1999, whilst Mr Kuhl was vacuuming the relevant reactor, a blockage occurred in the hose. Mr Kuhl left the reactor so as to try to free the blockage. The evidence at trial was that blockages frequently occurred in the hose, sometimes up to 20 times per night. Some blockages were cleared by Transfield employees shaking the hose, hitting the blockage with a shovel or using other similar measures. Blockages that could not be fixed were then dealt with by WOMA employees or people provided for the use of WOMA, sometimes by cutting the hose and then taping it back together, or by reversing the suction. Except when the hose was cut or the suction reversed, the vacuum truck would remain on during the process of attempting to clear the blockage. This was done to assist with the unblocking and to enable one to know whether the hose had successfully been unblocked. On this occasion Mr Kuhl was unsuccessful in unblocking the hose and Mr Kelleher then attempted to do so. Mr Kelleher was an employee of Hydrosweep but was provided for the use of WOMA under WOMA's direction. On this night the vacuum truck in use was provided by WOMA, and Mr Kelleher was operating the truck and attending to blockages. After attending to the blockage, Mr Kelleher made a gesture to Mr Kuhl that was interpreted by Mr Kuhl as indicating that the hose had been unblocked. The blockage had not actually been removed but that is not relevant to the issues in this appeal. Mr Kelleher then passed the hose back to Mr Kuhl when, some indeterminate but proximate time after, Mr Kuhl's arm was sucked into the hose. Both Mr Kuhl and Mr Kelleher struggled to free Mr Kuhl's arm, and were eventually successful in doing so. An important point for this appeal, which will become evident later in these reasons, is that there was very limited evidence as to what happened. Mr Kuhl's evidence in examination-in-chief was as follows: "What happened when the hose was handed back towards you? – My arm was caught in it, in the end, opening of it, whatever you want to call it. If you could just describe in your own words to the court, how was the hose passed back towards you? – Passed direct – What was the physical action? – Just passed directly back to me. I moved it a bit to the side to grab it as it was the only way to do it and the next thing my arm was gone. Which arm? – Left, sucked in. And how far was your left arm sucked into the hose? – Up to my shoulder." Mr Kuhl was not cross-examined and there is no other evidence as to how his arm came to be caught in the hose. The only other person who could have witnessed what happened was Mr Kelleher. His evidence, in examination-in-chief, was as follows: "Would it be fair to say that you passed it directly back towards him? – No, in front. Okay. Did you see how his hand came to be caught in the hose? – No." Later in cross-examination, Mr Kelleher gave the following evidence: "The way you described it to his Honour a moment ago … was [that] you passed the hose sideways to [Mr Kuhl]. Was that right? – Yeah. Out in front. Out in front, so that when you passed the hose to Mr Kuhl, the open end of the hose which had the suction at it, was facing away from Mr Kuhl? – Yeah, yeah. And in front of him? – Yeah. That's as I remember." The trial judge accepted Mr Kelleher's evidence that the suction inlet of the hose was directed away from Mr Kuhl as the hose was passed to him. That finding was not challenged in this Court and Mr Kuhl at no stage pleaded that Mr Kelleher was negligent in the manner in which he passed the hose. A notable aspect of the evidence in this case was that the defendants called no witnesses and challenged little of the evidence given in Mr Kuhl's case. As plaintiff it was for him to lead evidence of facts sufficient to prove, directly or by inference, on the balance of probabilities that WOMA owed to him a duty of care, that the duty was breached, and that the breach of the duty caused his injuries. The reasons of the trial judge In the District Court, Wisbey DCJ found that Mr Kuhl failed to establish that Hydrosweep owed him a duty of care or was negligent. That finding is not the subject of a challenge in this Court. With respect to WOMA, the trial judge found that the responsibility for training Mr Kuhl and providing him with a safe system of work was that of his employer, Transfield. The trial judge accepted that WOMA owed Mr Kuhl a duty of care, but held that the duty owed was to "provide a vacuum facility suitable for the purpose, which did not constitute risk of injury to those exercising proper care in its use"4. The vacuuming facility was suitable for its purpose and the possibility of injury occurring in the circumstances of the case was not reasonably foreseeable. In any event, the trial judge was not satisfied by Mr Kuhl "as to how and why his arm was drawn into the suction inlet" and, accordingly, it was not "possible to identify a relevant breach, and causally relate the incident to it". The reasons of the Court of Appeal In the Court of Appeal, Newnes JA, with whom Martin CJ agreed, held that there was no evidence to find that WOMA owed Mr Kuhl a duty to provide a safe system of work, nor any evidence "that WOMA had, or purported to exercise, any authority to supervise or direct the Transfield employees in that work". The evidence only established that it was Transfield who owed the relevant duty alleged by Mr Kuhl. Newnes JA then considered whether WOMA was under a duty to instruct Mr Kelleher not to pass the hose to another worker whilst it was under suction. [2009] WADC 4 at [40]. His Honour rejected that argument on the basis that there was no evidence of any increased risk of injury when the hose was being passed as opposed to being used to vacuum as intended. The importance of this issue for the questions of duty and breach is explained later in these reasons. Newnes JA then made the observation that the lack of evidence as to how precisely Mr Kuhl's arm became caught in the hose was a "surprising feature" of this case. That observation is then important for understanding what Newnes JA said when considering Mr Kuhl's submission that changes made to the hose post- accident indicated that there existed at the time of the accident a practicable method of reducing or eliminating the risk of injury. His Honour said5: "The fact that precautions were taken after the accident must not distract attention from the enquiry whether before the accident a reasonable person would have taken those precautions. The submission on behalf of Mr Kuhl that the risk of injury could have been avoided by simple and inexpensive modifications to the vacuum system seems to me to run into the immediate difficulty that in the absence of evidence as to precisely how the accident occurred, it is not apparent that the modifications suggested by Mr Kuhl were likely to have prevented the accident. In any event, in the absence of evidence that passing the hose under pressure involved any increased risk of a person coming into close proximity to the suction end, I do not consider that it can be said the failure to implement those measures before the accident demonstrates a breach of duty". (emphasis added) As will appear, we agree with what appears in this passage of his Honour's reasons, and this should be determinative of the appeal to this Court. Wheeler JA dissented, finding that there was a reasonably foreseeable risk of injury in the passing of the hose as a matter of common sense and that there were reasonably practicable means of designing the hose so as to eliminate or reduce that risk. More is said of her Honour's reasons later. Duty of care At trial Mr Kuhl alleged that WOMA owed him a duty "to take reasonable care" for his safety "whilst he was engaged in carrying out his duties at the HBI Plant for [Transfield], not to expose [him] to any risk or injury or damage of (2010) 194 IR 74 at 89 [84]-[86]. which WOMA, its servants or agents knew or should have known and to take reasonable measures to ensure the system of work provided to and/or for [him] was safe". As noted earlier in these reasons, the trial judge formulated a narrower duty and that duty seems to have been accepted by the majority in the Court of Appeal. Wheeler JA, on the other hand, formulated three possible duties at a detailed and narrow level of specificity. Before this Court, Mr Kuhl formulated the relevant duty owed in a number of ways. First, he repeated that formulation pleaded in the District Court. Second, the relevant duty was said to be one to ensure, as far as reasonably practicable, that the hose was conveyed safely back to Mr Kuhl after it had been unblocked by employees or servants of WOMA. Third, it was said that WOMA had a duty to ensure that the powerful hose was as safe as it could reasonably be, in the event that an accident occurred. Two things must be said as to the formulation of a duty of care and its scope and content. First, there is an inherent danger in an action in negligence to look first to the cause of damage and what could have been done to prevent that damage, and from there determine the relevant duty, its scope and content6. In Koehler v Cerebos (Australia) Ltd7, McHugh, Gummow, Hayne and Heydon JJ observed that "to begin the inquiry by focusing only upon questions of breach of duty invites error. It invites error because the assumption that is made about the content of the duty of care may fail to take fundamental aspects of the relationship between the parties into account." Earlier in Vozza v Tooth & Co Ltd8, Windeyer J, when considering allegations of a failure to take reasonable care to provide suitable plant and equipment or devise and maintain a safe system of work, said: "The vigorous assertion of [these phrases] may sometimes obscure for juries the essential simplicity of the issue in a common law action for negligence. It may seem that, because an accident has happened and a workman has been injured, his employer is liable for damages if it can be 6 Vairy v Wyong Shire Council (2005) 223 CLR 422 at 443 [60], 461 [126]; [2005] HCA 62; Roads and Traffic Authority (NSW) v Dederer (2007) 234 CLR 330 at 353 [65], 406 [270], 408 [283]; [2007] HCA 42; Stuart v Kirkland-Veenstra (2009) 237 CLR 215 at 247 [85], 258-259 [127]-[128]; [2009] HCA 15. (2005) 222 CLR 44 at 53 [19]; [2005] HCA 15. (1964) 112 CLR 316 at 318; [1964] HCA 29. shown that, by some means, the accident might have been avoided. That is not so." His Honour was, of course, stressing that any duty owed cannot be to safeguard a worker completely from all perils. His warning is, however, equally apt for considering the question of duty more generally. That is not to say that regard cannot be had to the pleaded negligence before consideration is given to the scope and content of a duty. Findings as to the formulation of the duty of care will necessarily depend upon the alleged negligence and the evidence led at trial9. The approach by Wheeler JA as to the formulation of the duty is an example of the perils in first considering causation and breach to determine the relevant duty of care. Her Honour considered a number of possible actions WOMA could have taken and how effective each would have been to avoid the injury suffered by Mr Kuhl. She concluded that a break box on the hose10 would have been the most appropriate, that it would have reduced the risk of injury and that, therefore, WOMA owed Mr Kuhl a duty to have installed a break box. Such an approach runs the risk of predetermining the outcome before considering the first important step; whether WOMA owed Mr Kuhl a duty of care to begin with and, if so, what was the scope and content of that duty. Those questions are determined by considering reasonable foreseeability and the "salient features" of the relationship between the plaintiff and defendant11. Even if it can be said that there was some reasonable course of conduct the defendant could have engaged in that would have avoided the injury suffered by the plaintiff, the defendant will not be liable unless there can first be established the existence of a duty of care with the relevant scope and content. 9 Agar v Hyde (2000) 201 CLR 552 at 578 [64]; [2000] HCA 41. 10 The break box was described as a valve, or flap, which could be opened so as to allow the entry of air, thus reducing or eliminating the suction generated at the end of the hose. 11 Graham Barclay Oysters Pty Ltd v Ryan (2002) 211 CLR 540 at 597-598 [149]; [2002] HCA 54. See also Perre v Apand Pty Ltd (1999) 198 CLR 180 at 253 [198]; [1999] HCA 36; Sullivan v Moody (2001) 207 CLR 562 at 579-580 [50]-[52]; [2001] HCA 59. The second point is that the formulated duty must neither be so broad as to be devoid of meaningful content12, nor so narrow as to obscure the issues required for consideration13. With respect to the latter, Gummow and Hayne JJ in Graham Barclay Oysters Pty Ltd v Ryan14 said: "A duty of care that is formulated retrospectively as an obligation purely to avoid the particular act or omission said to have caused loss, or to avert the particular harm that in fact eventuated, is of its nature likely to obscure the proper inquiry as to breach." Different classes of care may give rise to different problems in determining the nature or scope of a duty of care15. In many cases a duty formulated as being one to take "reasonable care" may suffice for the finding of duty in that particular case. Cases that involve the duty of a solicitor to his or her client to exercise professional skill in accordance with the retainer16, the duty of a motorist towards other users of the road17, or the duty owed by an occupier of land to an entrant with respect to the condition of the premises18, ordinarily involve no real controversy over the scope and content of the duty of care; these are considered at the "high level of abstraction" spoken of by Glass JA in Shirt v Wyong Shire Council19. But where the relationship falls outside of a recognised relationship giving rise to a duty of care20, or the circumstances of the case are such that the alleged negligent act or omission has little to do with that aspect of 12 Vairy v Wyong Shire Council (2005) 223 CLR 422 at 447 [73]. 13 Modbury Triangle Shopping Centre Pty Ltd v Anzil (2000) 205 CLR 254 at 290 [103]; [2000] HCA 61; Fleming, The Law of Torts, 9th ed (1998) at 117-118. 14 (2002) 211 CLR 540 at 611 [192]. 15 Sullivan v Moody (2001) 207 CLR 562 at 579 [50]. 16 cf, as to third parties, Hill v Van Erp (1997) 188 CLR 159; [1997] HCA 9. 17 Imbree v McNeilly (2008) 236 CLR 510 at 528 [49]; [2008] HCA 40. 18 Thompson v Woolworths (Qld) Pty Ltd (2005) 221 CLR 234 at 243 [24]; [2005] HCA 19. 19 [1978] 1 NSWLR 631 at 639. See also Vairy v Wyong Shire Council (2005) 223 CLR 422 at 432 [25]-[26]; Jones v Bartlett (2000) 205 CLR 166 at 194 [100]; [2000] HCA 56. 20 See, eg, Perre v Apand Pty Ltd (1999) 198 CLR 180; Cole v South Tweed Heads Rugby League Football Club Ltd (2004) 217 CLR 469; [2004] HCA 29. a recognised relationship which gives rise to a duty of care21, a duty formulated at too high a level of abstraction may leave unanswered the critical questions respecting the content of the term "reasonable" and hence the content of the duty of care22. These are matters essential for the determination of this case, for without them the issue of breach cannot be decided. The appropriate level of specificity when formulating the scope and content of the duty will necessarily depend on the circumstances of the case. The duty owed by WOMA to Mr Kuhl To the extent that Wheeler JA formulated the duty as one to provide a hose with a break box, that was too narrow a duty and risked obscuring the issues in this case. So too is the second formulation of duty proposed by Mr Kuhl. The first formulation of duty proposed by Mr Kuhl, on the other hand, is too broad in light of all the circumstances of this case. Mr Kuhl may have been exposed to many risks in undertaking his duties which had nothing to do with WOMA, such as risks from the fines being, at times, very hot or from the work being conducted in a confined space. WOMA could not have a duty to undertake all reasonable measures to avoid any risk to Mr Kuhl of which it knew or ought to have known. To the extent Mr Kuhl alleges WOMA owed a duty to provide and maintain a safe system of work, that was rightly rejected by the trial judge and the Court of Appeal on the ground that there was no evidence that WOMA assumed responsibility for or had control of the work done by Mr Kuhl23. That is not to say that WOMA owed no duty to Mr Kuhl. The evidence established that WOMA provided the truck, set up the hose, was responsible for any blockages in the hose, and was to provide two personnel, one for unblocking the hose and the other for supervising the operation of the truck. The hose provided had suction operating at 1,500 pounds per square inch (some 50 times more powerful than a common household vacuum cleaner), had a diameter of four to six inches and was strong enough to suck up lumps of solidified iron ore material larger than six centimetres in diameter and, indeed, to suck up Mr Kuhl's 21 See, eg, Modbury Triangle Shopping Centre Pty Ltd v Anzil (2000) 205 CLR 254; Thompson v Woolworths (Qld) Pty Ltd (2005) 221 CLR 234; Koehler v Cerebos (Australia) Ltd (2005) 222 CLR 44; Vairy v Wyong Shire Council (2005) 223 CLR 22 Jones v Bartlett (2000) 205 CLR 166 at 213 [167]. 23 (2010) 194 IR 74 at 75 [2], 86-87 [70]-[71]; cf Koehler v Cerebos (Australia) Ltd (2005) 222 CLR 44 at 53 [21]. arm with such force that it took two men to free him. The hose extended over a total distance of up to 60 metres from the truck. relation the vacuuming facility above and beyond From this evidence it can hardly be said that it was not reasonably foreseeable, in light of the power of the hose, that a person using the hose might suffer injury if WOMA did not take reasonable care in providing appropriate equipment. It can also be inferred that WOMA had assumed some responsibility that of a non-manufacturing distributor of a product to an end user24; it provided operators and ongoing assistance with the running of the vacuuming system. WOMA exercised a level of control over the vacuuming facility both in its ability to turn the truck off and with its responsibility for clearing blockages. WOMA was not responsible for the training of Mr Kuhl nor was Mr Kuhl subject to WOMA's control. However, the supervision of the vacuuming facility by WOMA's servants, and its obvious knowledge that persons like Mr Kuhl would be using the vacuuming hose for the purpose for which WOMA provided the hose, indicates that it was reasonable to require WOMA to have persons like Mr Kuhl in contemplation as people who might be put at risk by WOMA's negligence in providing and operating the vacuuming facility. There are also no considerations of indeterminacy or incoherence that tend against a finding of duty on the part of the WOMA. The critical question in this case concerns the scope and content of the duty owed by WOMA. The evidence outlined above supports the finding of a duty to take reasonable care to provide a hose, truck and vacuuming facility that would not subject foreseeable users of the hose to an unreasonable risk of injury. This duty concerns the condition of the equipment and is no different in substance to the duty formulated by the trial judge, except for the trial judge's additional requirement that the user of the hose be "exercising proper care"25. Although there was some debate in this Court as to the appropriateness of that additional requirement, the requirement itself adds nothing more stringent to the duty formulated. Even a foreseeable user of the hose exercising proper care would necessarily include a worker who may, upon undertaking repetitive tasks, be inadvertent at times26. Contrary to the submission of Mr Kuhl in his third formulation of the duty proposed to this Court, there was no requirement for a specific duty to ensure the hose was as safe as it could reasonably be in the event 24 See McPherson's Ltd v Eaton (2005) 65 NSWLR 187. 25 [2009] WADC 4 at [40]. 26 See Czatyrko v Edith Cowan University (2005) 79 ALJR 839 at 843 [12]; 214 ALR 349 at 353; [2005] HCA 14. of an accident. There is no reason to confine the duty only to situations immediately following an accident. WOMA's responsibility for the operation of the truck and the unblocking of the hose would also place a corresponding duty on WOMA's employees and agents to take reasonable care in carrying out those functions so as to avoid causing injury to others in the vicinity who could have foreseeably suffered injury, such as Mr Kuhl. Such a duty might encompass a situation where a person for whom WOMA is vicariously liable negligently passed the hose to a user in such a manner that the user's arm was sucked into the hose. But that was not the allegation in this case. Within the context of the duty so formulated, questions as to the safety of the hose itself, such as whether the hose should have included a break box or a handle, would then fall for determination when dealing with breach and causation. But an issue whether WOMA should have instructed users of the hose not to pass it under suction does not relate to the condition of the hose itself. The negligence asserted by Mr Kuhl of a failure by WOMA to issue prior instructions not to pass the hose under suction does not readily fall within the formulated duty to take reasonable care in unblocking the hose and operating the truck. That duty concerns the manner in which that conduct is undertaken, whereas the negligence asserted concerns an omission on the part of WOMA to take further steps to avoid injury to persons while the hose was being passed. The common law requires "some broader foundation than mere foreseeability" before a duty to act, as opposed to a duty to take reasonable care when acting, will be imposed27. The absence of evidence as to the contractual relationship between Transfield and WOMA is an impediment to the identification of a "special relationship" that would give rise to a duty on the part of WOMA to take steps to prevent injury to a Transfield employee when the hose was being passed. But on the assumption that the evidence was sufficient to give rise to an inference of such a special relationship, the issue remains whether the scope and content of the duty owed by WOMA to Mr Kuhl would include a duty to take additional reasonable precautions with respect to the passing of the hose so as to avoid causing injury to those receiving the hose. It is that duty as formulated that would be required for Mr Kuhl to then be able to allege that WOMA's failure to warn was negligent. 27 Sutherland Shire Council v Heyman (1985) 157 CLR 424 at 479; [1985] HCA 41; Pyrenees Shire Council v Day (1998) 192 CLR 330 at 368-369 [101]-[102]; [1998] HCA 3; Modbury Triangle Shopping Centre Pty Ltd v Anzil (2000) 205 CLR 254 at 266 [28]; Roads and Traffic Authority (NSW) v Dederer (2007) 234 CLR 330 at For the scope and content of the duty to include the taking of additional reasonable precautions with respect to the passing of the hose, it must be reasonably foreseeable that the act of passing the hose was itself more dangerous, or bore a higher risk of injury, for the person to whom it was being passed than the mere use of the hose. This must be so as it has already been established that WOMA owed Mr Kuhl a duty to take reasonable care to ensure that the equipment provided would not subject a person using the hose to an unreasonable risk of injury, and to take reasonable care when undertaking its activities. To extend the scope and content of the duty to include a duty to take additional reasonable precautions to avoid causing injury when the hose was being passed necessarily requires there be some additional risk in the act of passing. If it was not reasonably foreseeable that the passing of the hose exposed the receiver of the hose to any greater risk than when it was used for its intended purpose, there is no occasion for the scope of the duty to extend beyond that already owed to the user of the hose. It is in this context that the following passage in the judgment of Newnes JA is to be understood28: "The risk of injury from coming into close proximity to the suction end of the hose ... was obvious and, as [the trial judge] found, Mr Kuhl was acutely aware of it. There was no evidence of a greater risk that a person's body would come into closer proximity to the suction end inherent in passing it under pressure from one worker to another than in the ordinary operation of the hose, even if it was dropped. There was, as counsel for WOMA submitted, no evidence that the hose under pressure was not inert but was prone to significant or sudden movement caused by the pressure which would have made the handing over of the hose more hazardous, nor was there evidence of any other characteristics that were likely to lead to an increased risk of injury. Had the hose had any such characteristics it would have been a simple matter for Mr Kuhl to have led evidence of them. There was no such evidence." It is also important that the trial judge found that Mr Kelleher did not pass the hose in a negligent manner and in fact passed the hose so that the suction end was at all times pointed away from Mr Kuhl. Before this Court Mr Kuhl adopted the reasoning of Wheeler JA that, as a matter of common sense, the passing of the hose involved an increased risk of injury, such that evidence to that effect was not required. Wheeler JA compared 28 (2010) 194 IR 74 at 87 [75]. the situation to the passing of an operational chainsaw, which would be an inherently risky activity29: "The risks of a slip or clumsy movement are increased because there are more people involved in the movement and, of course, there are risks of 'miscommunication' about the way the manoeuvre is to be performed." But the operation of the hose cannot relevantly be compared to that of a chainsaw. Injury could only occur from the hose if the body was to come in contact with the opening at the suction end, which pointed only in one direction and was four to six inches in diameter. There was no evidence at trial as to how Mr Kuhl's arm became caught in the hose. Such evidence could have established facts from which it could then be inferred that the passing of the hose was more dangerous, but without such facts no inference can be made. At its highest, the evidence was that the hose was awkward to handle, but again that alone cannot be used to then infer that passing must necessarily be riskier than vacuuming. There was also no evidence that the hose acted in any unpredictable manner when dropped, such as would increase the risk of the suction end coming into contact with someone being passed the hose. Without this evidence, no inference can be made to find that there was an increased risk in passing the hose. If there was no increased risk, then the duty owed by WOMA would not require any additional steps to be taken by WOMA respecting the passing of the hose. In any event, even if the duty did so extend, as these reasons explain, there was insufficient evidence to show that WOMA breached any duty, or that such a breach caused the injuries of Mr Kuhl. It is to these matters that we now turn. Breach of duty At trial Mr Kuhl's allegations, as summarised by the trial judge30, were that WOMA was negligent in failing to: "(i) warn the plaintiff of the danger of body contact with the suction inlet; ensure the plaintiff was adequately trained in the proper operation of the vacuum hose; 29 (2010) 194 IR 74 at 77 [14]. 30 [2009] WADC 4 at [4]. (iii) instruct the plaintiff in the safe operation and handling of the provide proper supervision; and provide a vacuum hose with a protective mesh guard over the suction inlet, appropriate grip handle, and capacity to terminate suction." Paragraphs (i) to (iii) can be immediately dismissed because it was not established, for the reasons given earlier, that WOMA had a relevant duty that would encompass these measures. Paragraph (iv) did not appear to be pressed by Mr Kuhl in the courts below, nor before this Court, and in any event would similarly fall outside of the duty found to have existed. With respect to par (v), the evidence at trial established that following Mr Kuhl's injury there was a trial placement of a protective mesh guard over the suction inlet, but it was found to be impractical and impeded too greatly the ability of the vacuum to suck up the waste material. A nozzle, attached to the suction end, incorporating a grip handle was also tried but found to be too cumbersome and led to other safety concerns, mainly to do with ergonomic issues. A reasonable person in WOMA's position would not, therefore, have implemented these measures in response to the risk of injury posed. In this Court, Mr Kuhl relied only on two measures that WOMA should have taken prior to the accident; the failure to do so being the relevant breach of duty. First, WOMA should have issued an instruction not to pass the hose from one person to another unless the vacuum suction was turned off. Secondly, WOMA should have installed a break box onto the hose. Mr Kuhl did not allege that WOMA was vicariously liable for any negligence on the part of Mr Kelleher or Mr Atkinson, a WOMA employee on site who directed Mr Kelleher as to the work to be undertaken. At trial, counsel for Mr Kuhl led evidence as to modifications to the hose and system of vacuuming post-accident to support a finding of breach of duty. Evidence of measures adopted by a defendant after the accident may be relevant in some circumstances when determining whether it was reasonably practicable to adopt such measures. Gibbs J in Nelson v John Lysaght (Australia) Ltd31, with whom Stephen and Mason JJ agreed, said: "The onus of proving that it was unreasonable not to take the precaution, of course, lay on the [plaintiff]. However, when the [defendant], which must have had full knowledge of the nature, cost and practical 31 (1975) 132 CLR 201 at 214-215; [1975] HCA 9. consequences of the new installation, gave no evidence, and by its counsel asked no questions, to suggest that it was inordinately expensive or in any other way disadvantageous, the jury was entitled to infer at the very least that the advantages of the method which the [defendant] has since adopted were not outweighed by any disadvantages." Here, the first respondent, standing in the place of WOMA, with full knowledge of the nature, cost and practical consequences of the break box, gave no evidence, nor did its counsel ask any questions, to suggest that implementing the break box would have been overly burdensome or impractical. The evidence of Mr Collins, a safety adviser with BHP Billiton but at the time of the accident a trades assistant working as a "reactor rat", was that a break box was installed on the hoses by WOMA and Transfield some seven to 10 days after the accident. The break box was installed at a join or connection in the hose, approximately 10-15 metres from the suction inlet. The nozzle, incorporating a grip handle, which had been given a trial, had also featured a break box but, as noted above, was too cumbersome and placed strain on the user's back. Mr Collins described the break box as "a really good safety device", that was made using materials and personnel already on the site. It is unclear whether instructions were given by WOMA following the accident not to pass the hose under suction. Mr Collins initially suggested such instructions were given, but when cross-examined by counsel for the first respondent, he conceded that such an instruction was not to be found in the safety procedures document he had drafted. Whether or not any such instruction was issued in relation to passing the hose under suction, finding a breach of duty requires more than proof that the measure was reasonably practicable. What was said in Nelson v John Lysaght (Australia) Ltd is relevant to the proof of reasonable practicability. But what is required to establish a breach is that a reasonable person in the defendant's position would have foreseen that his or her conduct involved a risk of injury to the plaintiff or to a class of persons including the plaintiff, before determining what a reasonable person would have done in response to the risk32. As explained earlier in these reasons, a difficulty in Mr Kuhl's case is that he must establish that it was reasonably foreseeable that a failure to warn not to pass the hose under suction risked causing a person in his position some injury above and beyond the risks associated with such a person using the hose for its intended purpose of vacuuming up the waste in the reactor. It is foreseeable that use of the hose itself, with its high suction, could cause injury. But that does not 32 Wyong Shire Council v Shirt (1980) 146 CLR 40 at 47-48; [1980] HCA 12. mean that the hose must not be under suction whenever in use; if so, there would be no way in which the hose could then be used for its intended purpose. Therefore, before WOMA could be expected to take any additional measures to avoid a risk of injury when the hose is being passed, it must first be established by the plaintiff that there was a foreseeable risk of injury that was greater than when normally using the hose. That was not established in this case. Also of importance is the finding of the trial judge, adopted by Mr Kuhl in the appeal to this Court but towards another end, that the risk of injury from having a body part sucked into the hose was obvious. In assessing the standard of reasonable care, the obviousness of the risk is necessarily a factor and the more obvious the risk, the less required of the reasonable defendant to avoid or reduce that risk33. To this may be added the evidence at trial that blockages frequently occurred and were often dealt with by Transfield employees without the suction being turned off. From this evidence it may be inferred that it was impracticable to turn the suction off whenever a blockage occurred and the hose may need to have been passed, such that a reasonable person in the defendant's position would not issue such an instruction. With respect to none of these matters was there evidence upon which to make a finding that a failure to issue an instruction to only pass the hose while not under suction was a breach of any duty owed by WOMA to Mr Kuhl. With respect to the break box, as has been acknowledged in these reasons, it was reasonably foreseeable that use of the hose entailed a risk of injury. In these circumstances, several inferences may be made from the evidence. First, that there was a reasonably foreseeable risk that a failure to install a break box could cause injury to a person like Mr Kuhl, and that such a risk, given the power of the hose, was not insignificant or "far-fetched or fanciful"34. The second inference is that, the break box later having been installed and evidence not having been adduced by the first respondent to suggest this course was impractical, a reasonable person in WOMA's position would have installed the break box. However, that does not lead to the conclusion that Mr Kuhl must succeed in the appeal to this Court. The issue then becomes whether he has established, on the balance of probabilities, that the failure to install the break box caused his injuries. It is to that issue that we now turn. 33 Romeo v Conservation Commission (NT) (1998) 192 CLR 431 at 456 [56], 481 [131], 489 [157]; [1998] HCA 5; Woods v Multi-Sport Holdings Pty Ltd (2002) 208 CLR 460 at 503-504 [144]; [2002] HCA 9; Swain v Waverley Municipal Council (2005) 220 CLR 517 at 564 [140]; [2005] HCA 4. 34 Wyong Shire Council v Shirt (1980) 146 CLR 40 at 47. Causation To satisfy the element of causation on the case presented for Mr Kuhl to this Court, it would be necessary to identify the action which, on the available evidence, the trial judge could conclude ought to have been taken; that action, if failure to take it is to be accounted negligent, must be such that the foreseeable risk of injury would require it to be taken, having regard to the nature of that risk and the extent of injury should the risk mature into actuality; and it would be necessary that the trial judge could conclude as a matter of evidence and inference that, more probably than not, the taking of that action (here the installation of the break box) would have prevented or minimised the injuries the plaintiff sustained35. When dealing with the question of causation, Wheeler JA addressed the trial judge's observation of the lack of evidence by Mr Kuhl as to how his arm became caught in the hose. Her Honour said36: "The only inferences open, then, appear to be that, in the process of passing a heavy, awkward hose, with very powerful suction, the appellant: misunderstood how Kelleher expected him to take it (it being too noisy for express verbal communication); or took it clumsily; or slipped; or simply misjudged how far away his arm should be in order to avoid getting caught." With respect to the first inference, there was no evidence that there was any miscommunication between Mr Kelleher and Mr Kuhl, other the miscommunication as to whether or not the hose was unblocked. But whether or not the hose still had a blockage, Mr Kuhl's arm could still be drawn in. The other inferences posited by her Honour are certainly possibilities, but that does not mean that Mr Kuhl has satisfied his burden of proving that the failure by WOMA to install a break box caused his injuries. than First, the evidence at trial concerning the break box was that it was installed some 10-15 metres from the end of the hose and it would only work to stop the suction when manually operated. That being so, on the morning in question, Mr Kuhl's arm would still have been sucked into the hose. There was no evidence as to how quickly Mr Kuhl, in circumstances where his arm was caught in the hose and he was trying to pull his arm out, would have been able, if 35 State of Victoria v Bryar (1970) 44 ALJR 174 at 175 per Barwick CJ, McTiernan, Owen and Walsh JJ concurring. 36 (2010) 194 IR 74 at 77 [11]. at all, to operate the break box to stop the suction. One could infer that Mr Kelleher or another worker would be able to operate the break box in these circumstances, as Mr Kelleher came to the aid of Mr Kuhl soon after noticing that his arm was stuck in the hose. But even then, there would be an interval in which Mr Kuhl's arm was stuck in the hose. That necessarily begs the question, at what point did Mr Kuhl sustain the full extent of his injury? If it was immediately upon his arm being sucked into the hose, then the break box would have done nothing to prevent the injury. If it was the time during which his arm was in the hose, there is no evidence upon which to make a finding as to how long his arm would likely have been in the hose had the break box been installed. Finally, it may have been the act of pulling his arm out of the hose that caused the injury, but again there is no evidence upon which to infer that Mr Kuhl would not have attempted to first pull his arm out, instead of trying to move 10 to 15 metres to activate the break box or waiting for someone else to do so. These unanswered questions indicate that this Court cannot now establish what it was that caused the injury to Mr Kuhl; there is no evidence from which the necessary inferences could be drawn. So much seemed to be accepted by counsel for Mr Kuhl. However, he submitted that common sense dictates that, in any event, failure to install the break box materially increased the risk of injury and that if there was medical evidence to be led as to the cause of the injury, it was upon the respondents to lead that evidence. That submission appears to be based on what was said by Dixon J in Betts v Whittingslowe37: "[B]reach of duty coupled with an accident of the kind that might thereby be caused is enough to justify an inference, in the absence of any sufficient reason to the contrary, that in fact the accident did occur owing to the act or omission amounting to the breach of statutory duty." (emphasis added) But, as Kiefel J noted in Roads and Traffic Authority v Royal38, the observation of Dixon J must be considered in light of the circumstances of that case where, as Dixon J also said39, "the facts warrant no other inference inconsistent with liability on the part of the defendant". There is no reason, neither from the evidence adduced at trial nor as a matter of logical inference, to find that the 37 (1945) 71 CLR 637 at 649; [1945] HCA 31. 38 (2008) 82 ALJR 870 at 897 [139]; 245 ALR 653 at 688; [2008] HCA 19. 39 (1945) 71 CLR 637 at 649. break box would have avoided or lessened the injury suffered by Mr Kuhl. It was not the only inference that could be made. The absence of evidence in this regard recalls what was said by Windeyer J in Vozza v Tooth & Co Ltd40: "To speak of a jury using their experience, common sense and common knowledge means nothing unless they be given facts to which they can apply their experience, common sense and common knowledge." It was incumbent upon Mr Kuhl to satisfy the trial judge that the installation of the break box would have avoided or lessened his injuries. Without any evidence, medical or otherwise, to support such a conclusion, there could be no finding that any negligence on the part of WOMA was causative of the damage suffered by Mr Kuhl. With respect to the failure to issue an instruction not to pass the hose under suction, the absence of any evidence as to how Mr Kuhl's arm came to be caught in the hose is important. The "only inferences open" of which Wheeler JA spoke are not, in fact, the only inferences open on the evidence. As the first respondent submitted in this Court, it is not even clear from the evidence that it was due to the act of passing the hose that Mr Kuhl's arm became caught in it. The evidence of Mr Kelleher, accepted by the trial judge, was that he had passed the hose to Mr Kuhl, with the suction inlet directed away from Mr Kuhl, then looked away, and only later noticed that Mr Kuhl's arm was stuck in the hose. Certainly, it is possible that the hose slipped, or that Mr Kuhl took it clumsily, or that Mr Kuhl misjudged how far away his arm should be in order to avoid it getting caught, but it is also possible on the evidence that Mr Kuhl commenced using the hose as he would have had it not been passed, and in the process somehow had his arm sucked in. Mr Kuhl relied on Hamilton v Nuroof (WA) Pty Ltd41 for the proposition that precise evidence which indicated how his arm was sucked into the hose was not necessary. That case concerned the duty of an employer to adopt a safe system of work. The decision has been said42 to indicate that it may be 40 (1964) 112 CLR 316 at 321. 41 (1956) 96 CLR 18; [1956] HCA 42. cf Commissioner of Main Roads v Jones (2005) 79 ALJR 1104 at 1109 [26], 1111 [40]; 215 ALR 418 at 424-425, 427; [2005] HCA 27. 42 Glass and McHugh, The Liability of Employers in Damages for Personal Injury, unnecessary for a plaintiff to show exactly how the injury occurred if there be a defect in the system of work and it is clear that the injury arose out of the defective system. However, in the present case, as noted above, there was no evidence that WOMA assumed responsibility for or had control of the work done by Mr Kuhl as an employee of Transfield. The remarks of Dixon CJ and Kitto J in Hamilton43 that the exact cause of the bucket of hot bitumen spilling onto the plaintiff need not be ascertained for a finding of negligence need to be understood in that context. There was sufficient evidence in Hamilton to find that the act of passing a bucket of hot bitumen upwards and above one's head was an unsafe system of work. In those circumstances, the only inference that could be made was that it was because of the unsafe system of work that the bitumen was ultimately spilled onto the plaintiff. It was also a clear matter of common sense that lifting a bucket of hot bitumen above one's head increased the risk of injury when compared to carrying the bucket in other ways. In this case, there was no duty on WOMA to provide a safe system of work for Mr Kuhl, nor was it so obvious that passing the hose led to a greater risk of injury than mere use of the hose. Even accepting an inference that, given the short time between the passing of the hose and Mr Kuhl's arm becoming stuck in it, the act of passing had something to do with the accident, it still was necessary for there to be some evidence from which to conclude or infer that had WOMA issued a warning or an instruction not to pass the hose under suction, that instruction would have been followed. However, the evidence at trial was in such a state that one could properly infer it was likely such an instruction would not have been followed on the morning in question. The evidence of Messrs Kuhl, Kelleher, Collins, Rogosic and Rachman, all personnel familiar with the process of cleaning the reactor and using the hose, established that the hose frequently had blockages and that these blockages were frequently dealt with by the "reactor rats" or persons nearby without turning off the vacuum truck. Accordingly, it is unlikely that when dealing with the blockage in this case, without need for the hose to be physically cut or the suction reversed, that the truck would have been turned off prior to the hose being passed. There is no other evidence to suggest that any instruction to turn the truck off would have been followed. Accordingly, Mr Kuhl has not established that any breach on the part of WOMA caused his injuries. Order The appeal should be dismissed with costs. 43 (1956) 96 CLR 18 at 23-24. HEYDON, CRENNAN AND BELL JJ. The factual background The BHP HBI plant in Port Hedland contains reactors used in the production of iron. Transfield Construction Pty Ltd ("Transfield") was responsible for cleaning the reactors out. The plaintiff was one of Transfield's employees. Among his tasks was the task of entering the reactors and using a powerful vacuum hose to remove waste materials. The vacuuming equipment used by Transfield for the operation of the vacuum hose was supplied and set up by WOMA (Australia) Pty Ltd ("WOMA"), which also supplied two operators. Ordinarily one of the operators operated the vacuum truck to which a hose conveyed the waste materials extracted and the other checked and maintained the hose. The power which created the vacuum enabling the waste materials to be sucked from the reactors through the hose to the truck was supplied by a suction-creating power unit mounted on the truck. WOMA was responsible for directing and supervising the operators, and for setting up the vacuum hose and clearing blockages in it. At about 4.30am on 19 November 1999, while the plaintiff was vacuuming a reactor, the hose became blocked. The plaintiff came out of the reactor and endeavoured to unblock the hose but was unable to do so. Mr Kelleher, an employee of Hydrosweep Pty Ltd ("Hydrosweep"), was nearby. That company had supplied another vacuum truck and two employees to WOMA, one of whom was Mr Kelleher. On that night this second vacuum truck was not in operation and the second employee was not present. Not only was Mr Kelleher operating the truck, he was, the trial judge found, "attending to line blockages"44 in relation to the truck supplied by WOMA. Mr Kelleher attempted to unblock the hose. The trial judge found that Mr Kelleher passed the hose "sideways to, in front of, and with the suction inlet directed away from the plaintiff", who was standing a metre or two to Mr Kelleher's right-hand side45. It was not alleged that Mr Kelleher did this negligently. The plaintiff's left arm was then sucked into the hose, causing him quite severe injuries. The plaintiff's case Although the plaintiff's case on duty of care was put more ambitiously, one question is whether the evidence on which the plaintiff relied supported the 44 Kuhl v Zurich Financial Services Australia Ltd [2009] WADC 4 at [22]. 45 Kuhl v Zurich Financial Services Australia Ltd [2009] WADC 4 at [22]. proposition that WOMA owed him a duty to take care to provide a hose, truck and vacuuming facility that would not subject those who might foreseeably use the hose to an unreasonable risk of injury in relation to uses to which it was reasonably foreseeable that the hose might be put. If so, the plaintiff's case was that that duty was breached in that WOMA failed to issue instructions not to pass the hose while the power was on, and in that WOMA had failed to install a break box 10 or 15 metres from the head of the hose which could be employed to break the vacuum pressure at the hose end by letting air in. The plaintiff contended that each breach caused his injuries. The trial judge's attack on the plaintiff's evidence The trial judge's finding. The trial judge said46: "The plaintiff was less than expansive when describing how his arm was drawn into the vacuum hose, and I formed the view that for whatever reason he was reluctant to say precisely what happened. I accept the essentially unchallenged evidence of Mr Kelleher that the suction inlet was directed away from the plaintiff as the hose was passed to him, and I am left to infer that some subsequent action by the plaintiff caused his arm to be drawn in by the suction force. I am satisfied that the plaintiff was acutely aware of the necessity not to allow any part of the body to come into contact with the suction inlet. Not only does the plaintiff accept that, but the associated risks were obvious." What was the "less than expansive" evidence of the plaintiff which caused the trial judge to conclude that he was "reluctant"? It was the following evidence in chief: "What happened when the hose was handed back towards you? --- My arm was caught in it, in the end, opening of it, whatever you want to call If you could just describe in your own words to the court, how was the hose passed back towards you? --- Passed direct --- What was the physical action? --- Just passed directly back to me. I moved it a bit to the side to grab it as it was the only way to do it and the next thing my arm was gone. 46 Kuhl v Zurich Financial Services Australia Ltd [2009] WADC 4 at [30]-[31]. Which arm? --- Left, sucked in." The plaintiff was not asked further questions in chief on that subject. He was not asked any questions in cross-examination about it either. The judge asked no questions about it. The significance of the trial judge's finding. The conclusion of the trial judge that the plaintiff was "reluctant to say precisely what happened" is an important one. If that conclusion were soundly arrived at, it would be a significant factor against the plaintiff's success. So, at least, the trial judge, the Court of Appeal majority and the first respondent thought. It would be significant because of the following considerations. Witnesses are supposed to answer questions put by counsel responsively: they are supposed to give a full answer, but no more. It is one thing to say that a witness was not asked the right questions. It is another thing to say that a witness did not answer the questions that were asked. And it is an even more serious thing to say that a witness was "reluctant" to answer. The duty of a witness is to tell the truth, the whole truth, and nothing but the truth so far as the questions asked seek it. The duty of a witness to answer questions responsively involves not only a negative duty (not to volunteer material for which the question does not call), but also a positive duty (to proffer all material within the witness's knowledge for which the question does call). To conclude that a party-witness is reluctant to say what happened is to conclude that the party-witness is deliberately failing to comply with the duty to tell the whole truth. That is a serious conclusion to reach, for the following reasons. The rule in Jones v Dunkel47 is that the unexplained failure by a party to call a witness may in appropriate circumstances support an inference that the uncalled evidence would not have assisted the party's case. That is particularly so where it is the party which is the uncalled witness48. The failure to call a witness may also permit the court to draw, with greater confidence, any inference unfavourable to the party that failed to call the witness, if that uncalled witness appears to be in a position to cast light on whether the inference should be drawn49. These principles have been extended from instances where a witness has not been called at all to instances where a witness has been called but not questioned on particular topics. Where counsel for a party has refrained from 47 (1959) 101 CLR 298 at 308, 312 and 320-321; [1959] HCA 8. 48 Dilosa v Latec Finance Pty Ltd (1966) 84 WN (Pt 1) (NSW) 557 at 582. 49 Australian Securities and Investments Commission v Fortescue Metals Group Ltd (No 5) (2009) 264 ALR 201 at 225 [102]. asking a witness whom that party has called particular questions on an issue, the court will be less likely to draw inferences favourable to that party from other evidence in relation to that issue50. That problem did not arise here. The plaintiff's counsel did ask the plaintiff relevant questions. The rule in Jones v Dunkel permits an inference, not that evidence not called by a party would have been adverse to the party, but that it would not have assisted the party51. But the conclusion by the trial judge that the plaintiff – a party-witness – deliberately withheld evidence reflected a stronger reaction. It operated as a finding that there had been an admission. It could be inferred that the evidence was withheld, in breach of the witness's duty to tell the whole truth in answer to the question, because the plaintiff was conscious that success in the litigation would be rendered impossible or less likely if the material withheld were revealed. Depending on the circumstances, when a party lies, or destroys or conceals evidence, or attempts to destroy or conceal evidence, or suborns witnesses, or calls testimony known to be false, or fails to comply with court orders for the production of evidence (like subpoenas or orders to answer interrogatories), or misleads persons in authority about who the party is, or flees, the conduct can be variously described as an implied admission or circumstantial evidence permitting an adverse inference. The position must be the same where there is a failure of a party-witness to comply with the duty of a witness to tell the whole truth. There is a reason why failure to call a witness or failure to ask a particular question of a witness supports the possible inference that the witness's evidence would not have assisted the party, while failure of a party-witness to tell the whole truth may support an inference that the party suppressed evidence which would have been damaging to the party-witness. A litigant has no duty to call particular witnesses or to procure that any witnesses called by that litigant are asked particular questions. A litigant who enters the witness box, on the other hand, is under a positive duty to tell the whole truth in answer to the questions asked. The trial judge certainly appears to have perceived the plaintiff's answers to have operated as a kind of admission. The trial judge held that WOMA had "a duty to provide a vacuum facility suitable for the purpose, which did not constitute risk of injury to those exercising proper care in its use."52 It follows 50 Commercial Union Assurance Co of Australia Ltd v Ferrcom Pty Ltd (1991) 22 NSWLR 389 at 418-419. Handley JA stated some stronger propositions in those passages, but what he said is at least authority for what is stated above. 51 Dilosa v Latec Finance Pty Ltd (1966) 84 WN (Pt 1) (NSW) 557 at 582. 52 Kuhl v Zurich Financial Services Australia Ltd [2009] WADC 4 at [40]. that if the trial judge thought the plaintiff had not exercised proper care, he would fail. The trial judge inferred that "some subsequent action by the plaintiff caused his arm to be drawn in by the suction force."53 Now a subsequent action of that kind could be compatible or incompatible with the exercise of proper care. If one were ignorant of the dangers of the suction pipe, allowing one's arm to get close to it might not be careless. But the trial judge pointed out that the plaintiff was acutely aware of the dangers. The trial judge plainly assumed that the plaintiff had not exercised proper care, and had deliberately or carelessly placed his arm too near the hose. In the trial judge's apparent view, it was this which he was "reluctant" to reveal in his "less than expansive" description of what happened. It is true that at the end of his reasons for judgment the trial judge took a different stand. He said54: "the plaintiff having failed to satisfy me as to how and why his arm was drawn into the suction inlet, it is not … possible to identify a relevant breach, and causally relate the incident to it." Whether the plaintiff has demonstrated that the trial judge was right or wrong about that will be examined below. But it is one thing to say that a plaintiff's evidence is inadequate to make out a claim; it is another thing to say that a plaintiff's evidence is not only inadequate, but that it has been tailored by deliberate non-responsive suppression. It is not sound judicial technique to criticise a party-witness for deliberately withholding the truth in a fashion crucial to a dismissal of that party's claim unless two conditions are satisfied. First, reasons must be given for concluding that the truth has been deliberately withheld. Secondly, the party-witness must have been given an opportunity to deal with the criticism. The lack of reasons. It is not necessary to cite authority for the existence of the first condition. It was certainly not satisfied. The trial judge gave no reasons at all for the view he formed. Nothing on the face of the evidence indicates reluctance. The trial judge's conclusion could have been based on the demeanour of the plaintiff in answering the questions, or perhaps on the plaintiff's demeanour at other times during his testimony, or perhaps on his demeanour during the trial while not in the witness box. In this Court the first respondent repeatedly called the trial judge's finding "demeanour based". But the 53 Kuhl v Zurich Financial Services Australia Ltd [2009] WADC 4 at [30]. 54 Kuhl v Zurich Financial Services Australia Ltd [2009] WADC 4 at [40]. trial judge did not refer to demeanour as a justification for his conclusion. The absence of reasoning is the more serious in the following circumstances. The plaintiff had left school at 15. He was apprenticed as a panel beater and spray painter, and worked in that and other trades in the 34 years before the accident. On one occasion during his testimony he went "blank" and could not think. For him the witness box must have been a more than usually uncomfortable place. His supposed "reluctance" may have resulted from the shock and pain of a terrifying, indeed life-changing, incident. It may have been momentary forgetfulness or inarticulateness. The problem may have been capable of resolution if counsel had paused, or returned to the subject later. To attribute the paucity of his evidence to deliberate suppression without giving reasons for this course excluding all relevant innocent possibilities was an unjustified course. The lack of warning. The second condition is more controversial. Judges are not entitled to inform themselves before taking judicial notice without giving the parties an opportunity to comment on the material referred to55. Judges are not entitled to criticise expert witnesses by reference to expert material not in evidence without those witnesses having an opportunity to respond56. Judges are entitled to take into account the demeanour of party-witnesses, not only in the witness box, but while they enter and leave it, and also while they are sitting in court before and after giving evidence; but observations by the judge of conduct outside the witness box which the representatives of the parties may not have observed, should, if they are influential in the result, be drawn to the attention of the parties so that they may have an opportunity of dealing with the problem57. There is thus no general duty on a judge to advise the representatives of the parties of what they can see for themselves, namely the demeanour of the party-witness in the witness box. Nor, a fortiori, is there a duty on a judge to advise the parties that the party-witness's evidence is not adequate to make out the case of that party-witness. But there was held to be a breach of the duty of procedural fairness where a party claiming compensation for injury was held to have feigned or exaggerated her symptoms although this had not been suggested in cross-examination and the respondent disavowed that possibility58. 55 Gordon M Jenkins & Associates Pty Ltd v Coleman (1989) 23 FCR 38 at 47-48. 56 Australian and Overseas Telecommunications Corporation Ltd v McAuslan (1993) 47 FCR 492 at 495-496, 508-510 and 517-519. 57 Government Insurance Office of New South Wales v Bailey (1992) 27 NSWLR 304 58 Marelic v Comcare (1993) 47 FCR 437 at 443-444. If, in the present case, the first respondent had submitted in final address that the plaintiff had answered his own counsel's questions in chief about how his arm had been drawn into the vacuum hose by deliberately concealing material adverse to his case and favourable to the first respondent's – an allegation not of inadequacy in evidence but of suppression of evidence supporting an inference that the plaintiff knew his case was bad – a breach of the rule in Browne v Dunn59 would have taken place. In Browne v Dunn Lord Herschell LC said60: "it seems to me to be absolutely essential to the proper conduct of a cause, where it is intended to suggest that a witness is not speaking the truth on a particular point, to direct his attention to the fact by some questions put in cross-examination showing that that imputation is intended to be made, and not to take his evidence and pass it by as a matter altogether unchallenged, and then, when it is impossible for him to explain, as perhaps he might have been able to do if such questions had been put to him, the circumstances which it is suggested indicate that the story he tells ought not to be believed, to argue that he is a witness unworthy of credit. My Lords, I have always understood that if you intend to impeach a witness you are bound, whilst he is in the box, to give him an opportunity of making any explanation which is open to him; and, as it seems to me, that is not only a rule of professional practice in the conduct of a case, but is essential to fair play and fair dealing with witnesses." (emphasis added) An allegation in final address that the plaintiff suppressed evidence would be in substance a suggestion that he was not speaking the truth and ought not to be believed: for he had been asked in effect to describe the whole of what he observed and remembered about what happened when the hose was handed back towards him, and the allegation would be that he had failed to speak the truth by deliberately not describing the whole of what he remembered, but suppressing unfavourable parts of it. So to allege would have been to "impeach" the plaintiff as a witness. The remedies might have included a refusal by the judge to accept or entertain the submission, and a recall of the plaintiff to the witness box to deal with the allegation. Now if it was not open to counsel for the first respondent to make the postulated allegation, how can it have been open to the trial judge, without 60 (1893) 6 R 67 at 70-71. warning, to incorporate into his reasons for judgment a finding to the same effect as the allegation? For those reasons the second condition referred to ought to have been satisfied before the trial judge made the criticism he did. The second condition was not satisfied. The plaintiff had no opportunity to deal with the criticism. Normally cross-examining counsel will prefigure and lay the ground work for any criticism a judge may feel minded to make of a witness's evidence in chief. But here there was no cross-examination on the plaintiff's evidence in chief about what happened in the moments before he sustained his injuries. This created a difficulty for the trial judge. The tactical decision of defence counsel not to cross-examine on that topic may well have been shrewd. When Wigmore enunciated his celebrated but controversial proposition to the effect that cross-examination was "beyond any doubt the greatest legal engine ever invented for the discovery of truth", he immediately stated another much less controversial proposition by way of caveat: "A lawyer can do anything with a cross-examination – if he is skillful enough not to impale his own cause upon it."61 The truth of the second proposition lies in the fact that when a cross-examiner seeks to extract from a witness testimony which is more favourable to the cross-examiner's client than that which the witness gave in chief, the new testimony often turns out to be adverse to the client. If evidence in chief is thought to be too feeble to serve its purpose, cross-examiners often think it best to leave it alone, for to cross-examine will do no more than strengthen it: the repeated questions may cause the witness to think harder, may cause the witness to become more determined, may trigger better recollection and may result in the witness giving the more detailed evidence which was not given in chief. But decisions by cross-examiners of that kind are gambles, and the gambles can be lost. Whether the cross-examiner lost the gamble in this case is discussed below. There was no point in the trial judge mentioning his conclusion that the plaintiff's evidence was not frank and complete unless it played a role in his decision adverse to the plaintiff. In the absence of any challenge from the cross-examiner to the frankness and completeness of the plaintiff's evidence, it was incumbent on the trial judge, if his conclusion that the plaintiff had not been frank and complete was to play a role in his decision adverse to the plaintiff, to make the challenge himself. Perhaps the criticism in the judgment did not occur to the trial judge until after the plaintiff had left the box, or until after the hearing 61 Wigmore, Evidence in Trials at Common Law, Chadbourn rev (1974), vol 5 at 32 had concluded and before the judge's reserved judgment was given. It remained necessary either to recall the plaintiff or to have no regard to that aspect of the plaintiff's evidence. The first respondent repeatedly stressed the trial judge's finding under discussion, and sought to render it immune from appellate examination by calling it "demeanour based". But when the above difficulties were raised with counsel for the first respondent in this Court, he raised no strong defence of what happened, and fell back on the different point that the plaintiff's evidence was so scant and meagre as to leave, fatally, an unfilled gap. He described the plaintiff's case as having exhibited a "failure of proof", and he said there was "a lacuna in his evidence", as distinct from the plaintiff being the victim of "an inference adverse to him, drawn by the trial judge or by the Court of Appeal". It must be accepted that the trial judge put the matter in the alternative, but the primary conclusion reached is the adverse inference described above. The difficulties just discussed would justify an order for a new trial – an unpalatable prospect nearly three years after the first trial and almost 12 years after the accident. But the plaintiff does not seek a new trial. He seeks judgment. In the circumstances, although findings of the kind criticised above tend invisibly and inseverably to permeate the whole of a judge's reasoning, the desirable course is to proceed as though the trial judge's reasoning which has been criticised did not exist, with a view to seeing whether it was otherwise defensible. Duty A procedural problem. The Court of Appeal majority overturned the trial judge's conclusion that WOMA owed the plaintiff a duty of care. It did so of its own motion, in the absence of any notice of contention, and despite a concession by counsel for the first respondent that there was a duty of care. This does not seem to have been open to it, although it was open to it to reject the plaintiff's contentions that the duty of care was broader than that found by the trial judge. The nature of the duty. It was reasonably foreseeable to WOMA that the vacuum facility it provided to Transfield, and particularly the hose, would be used by Transfield employees to clean out the reactors. It was also reasonably foreseeable that from time to time the hose would get blocked and have to be unblocked. And it was reasonably foreseeable that different workers, whether employed by Transfield, WOMA or Hydrosweep, might work on the task of unblocking the hose, and hand it back and forth while the suction-creating power unit was in operation. Thus there was a duty on WOMA to provide a hose, truck and vacuuming facility that would not subject foreseeable users of the hose (including those who might be inadvertent at times) to an unreasonable risk of injury in relation to the uses to which it was reasonably foreseeable that it might be put. On that basis WOMA's duty of care extended to risks in relation to the passing of the hose, whether those risks arose from the way the hose was designed (for example, without a break box), or the way it was to be used (for example, without the protection of instruction to turn the power off while it was being handed back and forth between workers). In the Court of Appeal counsel for the first respondent (who was not leading counsel in this Court) was asked the following question by Martin CJ: "If passing the vacuum under load created a foreseeable risk of injury … that could have been easily avoided by turning the truck off before you passed the equipment under load … why wouldn't [WOMA] have owed a duty to the plaintiff to instruct Kelleher accordingly?" He answered in the affirmative. In this Court the first respondent attempted to withdraw that concession on various grounds. It should not be allowed to do so, for the simple reason that the concession was correct. Counsel for the first respondent submitted: "The co-existence of knowledge of a risk of harm and power to avert or to minimise that harm does not, without more, give rise to a duty of care at common law … The mere provision of plant and equipment to someone who intends to integrate it into their enterprise, and upon whom there is a common law duty to devise, institute and maintain a safe system of work, and to provide safe plant and equipment, cannot give rise to a common law duty of care to users of the equipment within the enterprise: something more must be needed. If it were otherwise, the burden on commerce would be intolerable, and areas of responsibility would overlap such as to potentiate conflicts in systems of work, creating rather than abrogating risks of harm. The supplier of plant and equipment may not know, and may have no means of knowing, the manner in which the plant and equipment will be integrated into its [customer's] enterprise; or how work systems might be adapted to deal with contingencies encountered; it would lead to indeterminate liability; it would make tortious that which was otherwise lawful; it would hinder the efficient operation of commerce." He submitted that the contract between WOMA and Transfield was relevant; that the equipment had been used for months without incident, and that Transfield had every opportunity to inspect, analyse and systemise the equipment within its system of work. However sound these submissions may be when applied to other circumstances, they are not sound here. WOMA knew, and had the means of knowing, how the fruits of Transfield's work in integrating the equipment within its system of work had developed, for it supplied not only equipment but also workers. However relevant the contract between WOMA and Transfield was, the Court of Appeal majority said it was never clearly explained in the evidence. Hence it has not been established that it restricted WOMA's duty. The incident-free history of the equipment is not irrelevant, but it is not determinative. The submission amounts to the proposition that, if an employer like Transfield owes a duty to its workers to maintain a safe system of work, there can never be a possibility of others owing the workers duties of care. The existence of a duty of care depends on the circumstances of each case; in this case the circumstances were sufficient to create the duty in WOMA which was stated above, which includes the duty that was conceded in the Court of Appeal. That was because of WOMA's special role in supplying the equipment, setting up the hose, clearing blockages and directing and supervising the two operators62. The dependence of duty on increased risk. But, contrary to what has just been said and contrary to the terms of the concession, let it be assumed that the Court of Appeal majority was correct to find that no relevant duty of care could exist in the absence of "evidence of a greater risk that a person's body would come into closer proximity to the suction end inherent in passing it under pressure from one worker to another than in the ordinary operation of the hose, even if it was dropped."63 The Court of Appeal majority said64: "There was … no evidence that the hose under pressure … was prone to significant or sudden movement caused by the pressure which would have made the handing over of the hose more hazardous, nor was there evidence of any other characteristics that were likely to lead to an increased risk of injury." And it said that had the hose had any characteristics likely to lead to an increased risk of injury in these circumstances, "it would have been a simple matter for [the plaintiff] to have led evidence of them."65 It said there was no such evidence. 62 See above at [57]-[58]. 63 Kuhl v Zurich Financial Services Australia Ltd (2010) 194 IR 74 at 87 [75]. 64 Kuhl v Zurich Financial Services Australia Ltd (2010) 194 IR 74 at 87 [75]. 65 Kuhl v Zurich Financial Services Australia Ltd (2010) 194 IR 74 at 87 [75]. The view that the passing of the hose under pressure from one worker to another did increase the risk of injury is correct for the following reasons. First, there was evidence of the characteristics of the hose. It was approximately six inches in diameter. It was "so flexible". It was "quite hard to hang on to and use". It was "very awkward" to handle. It was heavy. The suction, at 1500 pounds per square inch, was very powerful. It was powerful enough to suck up briquettes, rocks and iron lumps and convey them through the hose for 60 metres. It was fifty times more powerful than a normal vacuum cleaner. It was powerful enough to pick up big boulders incapable of passing through the six inch outlet. It was so powerful that when the plaintiff's arm was sucked in, he could not pull it out, either alone or with Mr Kelleher's help. A hose with these characteristics – in particular the fact that it was very awkward to handle – was dangerous. Secondly, in Neill v NSW Fresh Food & Ice Pty Ltd Taylor and Owen JJ "in many cases no more than common knowledge, or perhaps common sense, is necessary to enable one to perceive the existence of a real risk of injury and to permit one to say what reasonable and appropriate precautions might appropriately be taken to avoid it." Their Honours said that Hamilton v Nuroof (WA) Pty Ltd67 was such a case. In that case the plaintiff was injured when a bucket of bitumen, which he was lifting onto a roof, spilled over him. The trial judge said that on the evidence he was unable to find precisely how the accident occurred. Dixon CJ and Kitto J said68: "when a vessel containing forty pounds weight of molten material is raised by hand in front of the body high enough for a handle to be seized by a man above, there must be a greatly increased risk of its spilling whether through mishandling or mistake or mischance and the prospect of serious injury if that happens must be much greater also." They concluded that the danger was real and evident. The present case is not dissimilar. It was reasonably foreseeable that the danger would increase if the 66 (1963) 108 CLR 362 at 368; [1963] HCA 4. 67 (1956) 96 CLR 18; [1956] HCA 42. 68 Hamilton v Nuroof (WA) Pty Ltd (1956) 96 CLR 18 at 24. hose were handed from one workman to another while the equipment was operating, particularly since the plaintiff had been on duty for 10 and a half hours at the time of the accident, as part of a 12 hour shift worked seven days a week, who, although he could have taken off one week in three, in fact took no weeks off, and particularly since the plaintiff was operating in conditions which were not only hot and dusty but noisy. As Wheeler JA (dissenting) said69: "The risks of a slip or clumsy movement are increased because there are more people involved in the movement and, of course, there are risks of 'miscommunication' about the way the manoeuvre is to be performed." The trial judge appeared to infer from his conclusion that the plaintiff was "reluctant" to say what happened that "some subsequent action by the plaintiff caused his arm to be drawn in by the suction force."70 Wheeler JA pointed out that the trial judge made no positive finding, and there was no evidence, that the plaintiff had deliberately or carelessly injured himself; hence the available inferences were that one of the following happened – that he misunderstood how Mr Kelleher expected him to take the hose, being reliant only on sign language due to the noise; that he took the hose clumsily; that he slipped; or that he misjudged how far away from the end of the hose his arm should be in order to avoid getting caught71. That they were the realistically available inferences is supported by the shortness of time between when Mr Kelleher passed the hose and when the plaintiff's arm was caught. Each of those four possible inferences is compatible with the plaintiff exercising proper care. That is because they are illustrations, in the words of Windeyer J, of "some temporary inadvertence to danger, some lapse of attention, some taking of a risk or other departure from the highest degree of circumspection" which may be, and in this case – a case involving the operation of heavy, awkward, noisy machinery – are, "excusable in the circumstances because not incompatible with the conduct of a prudent and reasonable man."72 The first respondent in this Court contended that the line of authority to which Windeyer J referred did not apply in this case because of the trial judge's finding that the plaintiff was saying less than he knew about how the accident happened. But for the reasons given above that finding cannot stand. 69 Kuhl v Zurich Financial Services Australia Ltd (2010) 194 IR 74 at 77 [14]. 70 Kuhl v Zurich Financial Services Australia Ltd [2009] WADC 4 at [30]. 71 Kuhl v Zurich Financial Services Australia Ltd (2010) 194 IR 74 at 77 [10]-[12]. 72 Sungravure Pty Ltd v Meani (1964) 110 CLR 24 at 37; [1964] HCA 16. The conclusion that the hose was more dangerous when being passed from one workman to another than it was when being used by one workman alone follows from the fact that a workman operating by himself can steady himself and adjust his positioning in relation to the end of the hose, heavy and awkward to handle as it was, more easily than a workman receiving the hose from another workman. To put it crudely, a workman operating by himself is in a static position and in a position to be in full control of the hose; the process of one workman handing the hose to another is dynamic, and neither is in a position to be in full control, because each must depend on the reactions, and his perception of the possible reactions, of the other. The first respondent submitted that by the time the plaintiff suffered his injury the act of passing the hose was complete and the plaintiff was in a static position, in full control of the hose; the accident happened after the hose was passed because Mr Kelleher did not see it. But both Mr Kelleher and the plaintiff were silent as to how precisely the plaintiff's arm became caught in the hose: plainly it happened very quickly and unexpectedly. It cannot be inferred that the plaintiff had regained full and stable control of the hose after receiving it from Mr Kelleher before his arm was sucked in. Hence there was a duty of care on WOMA in relation to the passing of the hose, as the plaintiff submitted. Breach The plaintiff submitted that it had made out two pleaded breaches of WOMA's duty of care. The first lay in a failure to issue instructions not to pass the hose under pressure; ie, to ensure that the power was turned off before attempts were made to clear the hose by handing it back and forth between workers. Had those instructions been given, compliance with them would have precluded any risk of injury for the plaintiff on the night in question. These instructions were recommended after the accident by Mr Collins, who before the accident had had substantial experience as a safety representative and had received substantial safety training, and thereafter had safety responsibilities at the BHP HBI plant at Port Hedland. It is not clear whether the instructions were actually given after the accident. Had the instructions been given before the accident, they could not have been carried out on the night in question. Although WOMA was responsible for supplying two persons – one to operate the truck and the other to deal with blockages – on that night Mr Kelleher had to perform both roles, and he could not both be unblocking the hose and turning off the pressure 60 metres away down some flights of stairs. That circumstance in itself would have placed WOMA in breach of duty. The second breach lay in failing to install a break box 10 or 15 metres from the head of the hose which could be employed to break the vacuum pressure at the hose end by letting air in. Mr Collins thought that this was "a really good safety device … when … we had to move the hoses around, if they were under load". This idea was implemented soon after the accident. Wheeler JA concluded that a hose reasonably fit for the intended purpose would have included the break box, and that the breach lay in not including it. Plainly the mere fact that one change was recommended after the accident and the other introduced after the accident does not support a conclusion of breach of duty. The significance of these events is only to show what could have been done, not what should have been done. Whether what was done later should have been done earlier depends, inter alia, on whether "it was inordinately expensive or in any other way disadvantageous"73. No evidence of inordinate expense or other disadvantage in either technique was called by the first respondent or pointed to in argument. The first respondent put no other significant argument in relation to breach of duty, as distinct from causation. It is not possible to infer from the behaviour of the workers before the accident, at a time when no instruction not to pass the hose under pressure had been given, that they would have disobeyed the instruction if it had been given. It may be inferred from the giving of the instruction that it would probably have been obeyed, unless there is evidence making that inference unavailable: there is no such evidence. Nor can it be inferred from the fact that blockages were frequent and, before the accident, were often dealt with without turning the power off that it was not practicable to turn it off after the accident. The first respondent stressed that, apart from the break box, these and other changes were not made by WOMA, but were made in response to the recommendations of an accident investigation committee chaired by Mr McGillivray, the shutdown superintendent of BHP Billiton HBI. But the authorship of the changes is immaterial. The changes are not admissions of liability; they go only to show what could have been done before the accident. The plaintiff was correct to submit that WOMA was in breach of duty by not adopting the latter technique, which would have greatly reduced at least the extent of injury. The plaintiff was also correct to submit that WOMA was in 73 Nelson v John Lysaght (Australia) Ltd (1975) 132 CLR 201 at 214 per Gibbs J; [1975] HCA 9. breach of duty by not adopting the former technique, which would have prevented any risk of injury at all. Causation The first respondent put no submission that the failure to adopt the technique of shutting down the power was not causative of the plaintiff's injuries. Hence if that were a breach of duty, as has been found to be the case, there would be no causation problem. But the first respondent submitted that the absence of the break box was not causative of the plaintiff's injuries. It pointed out that the break box would have been 10-15 metres from the end of the hose; it would not have been possible for either the plaintiff or Mr Kelleher to have moved speedily to slide the aperture in the break box open; it was not self-evident that Mr Kelleher could have done so since there had been industrial disputation because non-Transfield people had done work in the reactor or reactors; there was no evidence of whether the plaintiff's injuries were caused when his arm first entered the hose, or caused before the break box could have been operated, or caused by attempts to remove the arm from the hose. Had the trial been by jury these submissions would have been inflammatory and profoundly counter-productive. It is sufficient now to say only that they are not convincing. There was no inhibition flowing from industrial disputation: the incident did not take place in the reactor; Mr Kelleher was responsible for and had not been inhibited from taking up the task of trying to clear the hose; whatever industrial disputation background there was did not prevent Mr Kelleher from responding to the instincts of common humanity in trying to pull the plaintiff's arm out of the hose, and it would not have prevented him from activating the break box. If the injuries had been caused by the efforts of the plaintiff and Mr Kelleher to pull his arm out, the first respondent would remain liable for them, because Mr Kelleher would simply have operated the break box, had there been one, rendering it unnecessary to pull the plaintiff's arm out. The hose was flexible and, had there been a break box, the plaintiff could have concentrated his energies on activating it rather than struggling on the floor trying to use his legs to free himself from the hose. In any event, according to the evidence of Mr Rogosic, the change actually implemented in relation to the break box involved having one worker operating the hose and another worker sitting beside the break box so that the former could signal to the latter whenever it was necessary to take vacuum pressure off the end of the hose. It would take no more than a couple of seconds for the shouts of the first worker whose arm was sucked into the hose to cause the second to activate the break box. To conclude that the plaintiff's injuries were all caused at the moment his arm was sucked in and not thereafter is unwarranted. The plaintiff's left arm was exposed to powerful vacuum forces for about 30 seconds. For most of that time the arm was exposed not only to the forces sucking it towards the truck, but to the reverse forces of the plaintiff and Mr Kelleher trying to pull it out. The possible causes of the plaintiff's injuries are divisible into three groups: those derived from the vacuum forces generated by the pump operating at the moment the arm was sucked in, those operating from the vacuum forces generated by the pump from that time until the arm was pulled out, and those operating from the forces applied by the plaintiff, with the aid of Mr Kelleher, in the course of his frenzied struggles to extract his arm from the hose. The reverse force which Mr Kelleher, using two arms, employed would not have been applied if there had been a break box in accordance with the change actually implemented, for the worker next to that break box would have responded almost instantaneously to the accident. Even if the change actually implemented had not been fully implemented, but implemented only to the extent of inserting a break box, the worker in the position of Mr Kelleher would not have taken much longer to respond by operating the break box rather than by trying to pull the plaintiff's arm out. And the plaintiff would not have been applying reverse force for the whole period either: while his instinctive reaction may have been to pull his arm out, he would also have been ensuring that the worker next to the break box (or alternatively the worker in the position of Mr Kelleher) activated it quickly. The first respondent submitted that, without medical evidence, it is not possible to say how much damage to the plaintiff's arm was done at particular stages. This is not a realistic approach. One can say, even without medical evidence, that the longer the arm stayed in the hose, and the more the plaintiff and Mr Kelleher tried to pull it out, the more probable it was that additional damage was being caused. It is a matter of ordinary human experience that trauma to muscles and nerves resulting in lesions, tearing and haematomas caused by force will worsen the longer the force is applied and the more powerfully it is applied. The first respondent's argument thus reduces itself to this: assuming that, even if there were a break box, some damage would have been done in the first couple of seconds after the arm entered the hose, it would not matter how little that damage was nor how much damage was done thereafter: the plaintiff is disabled from recovering any damages at all. It would not reflect well on the law if that submission were sound. To insist, as the first respondent did, on the need for expert medical evidence was to insist on something which would have wasted the time of the medical expert or experts, wasted the time of the court, and wasted the parties' money. The probabilities are that a not insignificant amount of the plaintiff's injuries would have occurred after the initial few seconds in which his arm was sucked into the hose. In the circumstances there is no bar to the conclusion that the plaintiff's damage was caused by the breach of duty alleged. That is particularly so in view of the fact that the parties had agreed on the quantum of damages. Had this not been so, the trial judge could have reduced the quantum of damages awarded to allow for injuries caused before the break box became operative, were that the only breach of duty involved. To use the plaintiff's sensible limitation of the dispute by agreeing on the damages as an indirect means of completely denying him recovery would not be satisfactory. In any event, the first respondent's submissions operate on an erroneous assumption about the test for causation. The question is whether the taking of a particular step which the defendant did not take "more probably than not … would have prevented or minimized the injury which was in fact received."74 Unless all the damage to the plaintiff was caused when and immediately after his arm was sucked into the hose, the sliding open of the aperture in the break box would have minimized the damage by avoiding some of it – that which would have occurred after that time. That is so whether the aperture was slid open after a very short time by a worker placed behind it, or whether it was slid open a little later by a worker standing in the position of Mr Kelleher. It is less probable than not that all the damage was caused at the moment when, and immediately after, the plaintiff's arm entered the hose. Doubts about what damage was caused when would go the question of quantum: but the parties' agreement on quantum eliminated debate about it. Relief It follows that the plaintiff's arguments for recovery succeed and the appeal must be allowed. The parties agreed on the quantum of damages. The following additional orders sought by the appellant were not opposed by the first respondent. The first respondent should be ordered to pay the appellant's costs of the appeal. The judgments and orders of the Court of Appeal and the District Court in favour of the first respondent should be set aside. In lieu thereof there should be judgment in the action for the appellant against the first respondent in the sum of $265,000 (that is, in addition to workers' compensation payments). The first respondent should pay the appellant's costs in the courts below. Those orders should be made. What of the second respondent, QBE Insurance (Australia) Limited? It was named as second respondent to the special leave application and to the 74 Victoria v Bryar (1970) 44 ALJR 174 at 175 per Barwick CJ (emphasis added). appeal. On the special leave application it was represented by the counsel who represented the first respondent. On the appeal it was represented by the same senior counsel as the senior counsel who represented the first respondent. Its brief written submissions in the appeal signed by another counsel and filed by solicitors who were different from those for the first respondent pointed out that the application for special leave did not refer to the second respondent, that the appellant's written submissions did not refer to it, and that the appellant did not seek any orders against it. The second respondent sought an order that the appellant pay its costs of the appeal. The points it made in support of its position could have been made in a letter to the appellant's solicitors, and an agreement could have been arrived at at an early stage without the incurring of significant expense. In the circumstances, as between the appellant and the second respondent, there should be no order as to the costs of the appeal. The orders in favour of the second respondent in the courts below should and will stand.

HIGH COURT OF AUSTRALIA MINISTER FOR HOME AFFAIRS OF THE COMMONWEALTH & ORS APPELLANTS AND RESPONDENTS Minister for Home Affairs of the Commonwealth v Zentai [2012] HCA 28 15 August 2012 ORDER Appeal dismissed with costs. On appeal from the Federal Court of Australia Representation S B Lloyd SC with H Younan for the appellants (instructed by Australian Government Solicitor) G R Kennett SC with P W Johnston and V M Priskich for the first respondent (instructed by Fiocco's Lawyers) Submitting appearance for the second and third respondents M G Hinton QC, Solicitor-General for the State of South Australia with M J Wait intervening on behalf of the Attorney-General for the State of South Australia (instructed by Crown Solicitor (SA)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Minister for Home Affairs of the Commonwealth v Zentai Extradition – First appellant determined to surrender first respondent for extradition to Republic of Hungary pursuant to s 22(2) of Extradition Act 1988 (Cth) ("Act") for qualifying extradition offence of "war crime" – "War crime" not offence under Hungarian law at time of acts said to constitute offence – Act applies in relation to Hungary subject to Treaty on Extradition between Australia and the Republic of Hungary ("Treaty") – Art 2.5(a) of Treaty states that extradition may be granted irrespective of when relevant offence committed, provided it was offence in Requesting State at time of acts or omissions constituting offence – Whether offence for which extradition sought must be offence in Requesting State at time of acts or omissions constituting offence. Words and phrases – "offence in relation to which extradition is sought", "qualifying extradition offence", "surrender determination". Extradition Act 1988 (Cth), ss 11, 22. Extradition (Republic of Hungary) Regulations (Cth). Treaty on Extradition between Australia and the Republic of Hungary, Art 2.5(a). Introduction In a joint judgment delivered in 2003 six members of this Court said1: "[I]t was, and is, settled law in the United Kingdom and Australia that a fugitive offender cannot be arrested for extradition overseas in the absence of a warrant issued under the authority of statute." This appeal concerns a constraint upon the statutory power of the Minister for Home Affairs ("the Minister") to determine that a person is to be surrendered for extradition in relation to an offence which did not exist at law in the requesting country at the time of the acts or omissions said to constitute the offence. On 12 November 2009 the Minister determined, pursuant to s 22(2) of the Extradition Act 1988 (Cth) ("the Act")2, that the first respondent ("the respondent") was to be surrendered to the Republic of Hungary. The determination related to an extradition offence constituted by the alleged commission of a war crime involving the killing of a young Jewish man at Budapest in November 1944. The offence of committing a "war crime" did not exist under the law of the Republic of Hungary until 1945. The decision was evidently made on the basis that it was sufficient that the alleged conduct constituted a criminal offence in 1944, namely murder3. The Republic of Hungary did not seek the respondent's extradition for the crime of murder. 1 Oates v Attorney-General (Cth) (2003) 214 CLR 496 at 503-504 [13] per Gleeson CJ, McHugh, Gummow, Kirby, Hayne and Heydon JJ; [2003] HCA 21. See also Attorney-General (Cth) v Tse Chu-Fai (1998) 193 CLR 128 at 134 [7] per Gaudron, McHugh, Gummow, Kirby, Hayne and Callinan JJ; [1998] HCA 25; Vasiljkovic v The Commonwealth (2006) 227 CLR 614 at 634 [49] per Gummow and Hayne JJ; [2006] HCA 40. 2 Section 22 of the Act provided for the determination to be made by the Attorney-General. As appears from a departmental submission forwarded to the Minister on 6 November 2009, discussed further below, the Minister relied upon s 19A of the Acts Interpretation Act 1901 (Cth) to carry out the relevant functions of the Attorney-General under the Act. His power to do so was not disputed in these proceedings. 3 On 6 November 2009, a departmental submission was forwarded to the Minister: O'Connor v Zentai (2011) 195 FCR 515 at 535 [83] per Jessup J. According to that departmental submission, the Republic of Hungary had advised that the respondent's alleged conduct "would have constituted the offence of 'murder' in Hungary at the time of the alleged conduct under Article 278 of Act V of 1878 of (Footnote continues on next page) On 10 December 2010, a judge of the Federal Court (McKerracher J), on the application of the respondent, directed the issue of writs of certiorari and mandamus to quash the Minister's decision and require him to determine that the respondent be released and not be surrendered to the Republic of Hungary4. The Full Court of the Federal Court, on appeal by the Minister, held by majority that the Minister had misconstrued a key provision of the Treaty on Extradition between Australia and the Republic of Hungary ("the Treaty") in purporting to make his determination5. The Treaty did not provide for extradition in relation to an offence which did not exist at law at the time it was allegedly committed. The primary judge's order for the issue of certiorari stood. However, the Full Court made a substituted order for the issue of mandamus requiring the Minister: "to determine, according to law, whether [the respondent] is to be surrendered to the Republic of Hungary in relation to the offence of war crime referred to in the extradition request made by the Republic of Hungary in its letter dated 23 March 2005." That order required the Minister, in effect, to reconsider his determination under s 22 on the basis that the Treaty, properly construed, did not provide for extradition in relation to an offence which did not exist at the time of the acts or omissions said to constitute that offence. The reasoning of the primary judge and of the Full Court is set out in the joint reasons for judgment. The Treaty is given effect in Australian domestic law by the Act and the Extradition (Republic of Hungary) Regulations (Cth) ("the Regulations") made pursuant to s 11 of the Act. The central question in this case concerns a proviso in Art 2.5(a) of the Treaty which, on the Full Court's reasoning, would prevent extradition for an offence which did not exist under the law of the Republic of Hungary at the time it was said to have been committed. By operation of s 22(3) of the Act that limitation is said to constrain the Minister's duty and power under the Hungarian Criminal Code and would therefore have been criminal at the time the conduct allegedly occurred." The departmental submission noted the respondent's objection that Art 2.5(a) of the Treaty deprived the alleged war crime of the status of an "extradition offence", but concluded that Art 2.5(a) required only "that the conduct constituting the offence for which extradition is sought must have been an offence in the Requesting [S]tate at the time the conduct occurred." (emphasis in original) 4 Zentai v Honourable Brendan O'Connor (No 4) [2010] FCA 1385. (2011) 195 FCR 515. s 22(2) to determine that the respondent is to be surrendered to the Republic of Hungary in relation to the war crime offence for which extradition was requested. The Minister appeals against the decision of the Full Court pursuant to a grant of special leave made on 9 December 20116. For the reasons that follow that appeal must be dismissed. Procedural background The Minister's determination that the respondent be surrendered to the Republic of Hungary came after a lengthy process which began on 3 March 2005. On that date, the Military Division of the Metropolitan Court of Budapest issued a warrant for the arrest of the respondent. On 23 March 2005 the the Commonwealth Attorney-General's Republic of Hungary wrote Department requesting the extradition of the respondent to the Republic of Hungary for the purpose of prosecution under the warrant. On the warrant it was alleged that in November 1944 the respondent, while stationed in Budapest as a member of the Horse-Drawn Train Division 1 of Corps 1 of the Hungarian Royal Army, Budapest, had recognised Peter Balazs, a young man of Jewish origin who was not wearing a mandatory yellow star. The respondent is alleged to have dragged Mr Balazs to an army post and, with others, to have beaten him to death. It was not in dispute that the war crime offence, first created under Hungarian law in 1945 and re-enacted as s 165 of the Criminal Code of the Republic of Hungary ("the Criminal Code"), did not exist as an offence when Mr Balazs was killed. Nor was it in dispute that the offence of murder did exist under Hungarian law at that time. Section 165 of Act IV of 1978 on the Criminal Code7 provided for war crimes defined by reference to a 1945 Decree8. The English translation of the relevant text of the Decree was as follows: "A person who seriously violated international legal rules applicable to war in respect of the treatment of the population of the occupied territories [2011] HCATrans 339 (French CJ, Gummow and Bell JJ). 7 The section, according to an English translation of its text, provided: "A special legal rule (Decree No 81/1945 (II.5.) ME, enacted by Act VII of 1945, amended and complemented by Decree No 1440/1945 (V.1.) ME shall provide for other war crimes". 8 Section 11(5) of Law-Decree No 81/1945 (II.5.) ME on People's Jurisdiction enacted by Act VII of 1945 and amended and complemented by Decree No 1440/1945 (V.1.) ME. or prisoners of war, or treated the population of the reannexed territories barbarously, misusing the power granted to him, or who was an instigator, perpetrator or accomplice of the unlawful execution or torture of persons either in Hungary or abroad". The Minister, acting under s 16 of the Act, issued a notice on 8 July 2005 stating that the request from the Republic of Hungary had been received. On the same day a magistrate, acting on the notice under s 12 of the Act, issued a provisional warrant for the arrest of the respondent. The respondent was arrested and granted bail. Over three years later, on 20 August 2008, a magistrate determined, pursuant to s 19 of the Act, that the respondent was eligible for surrender to the Republic of Hungary. In the meantime the respondent had instituted proceedings in the Federal Court challenging the validity of the conferral upon State magistrates of the power to determine eligibility for surrender under s 19. That challenge was unsuccessful at first instance9, on appeal to the Full Court10 and on appeal to this Court11. The respondent applied to the Federal Court under s 21 of the Act for review of the magistrate's determination under s 19. On 31 March 2009, the magistrate's determination was affirmed by Gilmour J12. An appeal to the Full Federal Court (Black CJ, Tracey and Barker JJ) against that decision was dismissed on 8 October 200913. The Minister's determination under s 22 and the challenge to the determination in the Federal Court that followed led ultimately to the appeal to this Court. Statutory framework The Act establishes procedures and confers powers upon the Minister for the extradition of a person from Australia to an extradition country in respect of an "extradition offence"14. An "extradition country" is a country declared by 9 Zentai v Republic of Hungary (2006) 153 FCR 104. 10 Zentai v Republic of Hungary (2007) 157 FCR 585. 11 The respondent's challenge was heard concurrently with two other matters: O'Donoghue v Ireland (2008) 234 CLR 599; [2008] HCA 14. 12 Zentai v Republic of Hungary [2009] FCA 284. 13 Zentai v Republic of Hungary (2009) 180 FCR 225. 14 Defined by s 5 of the Act in relation to a country other than Australia as including an offence against the law of that country for which the maximum penalty is death or imprisonment, or other deprivation of liberty, for a period of not less than 12 months. regulations under the Act to be an extradition country15. The Republic of Hungary is so declared by reg 3 of the Regulations. The multi-stage process leading to extradition involves the making of an extradition request by an extradition country; the issue of a notice by the Minister, expressed to be directed to any magistrate, that the request has been received16; and the issue of a provisional arrest warrant17. There follows either a consent by the person to surrender18 or a determination by a magistrate in proceedings under s 19 of the Act of the person's eligibility for surrender. An application for a review of the magistrate's determination may be made under s 21 to the Federal Court or the Supreme Court of the relevant State or Territory. If eligibility is established before the magistrate, and is unchallenged or is affirmed on review, the Minister is required by s 22(2), as soon as is reasonably practicable, to determine whether the person is to be surrendered in relation to a qualifying extradition offence or offences. A determination having been made, the Minister is required to issue a warrant for the surrender of the person to the extradition country19. The duty and power of the Minister to make a determination pursuant to s 22(2) is qualified. By regulation made under s 11, the Act may apply in relation to a specified extradition country subject to such limitations, conditions, exceptions or qualifications as are necessary to give effect to a bilateral extradition treaty in relation to that country20. Regulation 4 of the Regulations so applies the Act in relation to the Republic of Hungary. That application does not involve any broadening of the powers conferred by the Act. The scheme of s 11 has its ancestry in the Extradition Act 1870 (UK). That Act empowered the Queen in Council to make Orders in Council that the Act applied to a particular foreign state. The Queen in Council was also 15 Act, s 5, definition of "extradition country". 16 Act, s 16. 17 Act, s 12. 18 Act, s 18. 19 Act, s 23. Section 26 of the Act provides for the warrant to be executed according to its tenor. 20 Act, s 11(1)(a). Section 11(1B) provides that regulations may be made under both s 11(1) and s 11(1A) in relation to a specified extradition country. By operation of s 11(1C) this effect is achieved by a regulation which states that the Act "applies to the country concerned subject to that treaty." empowered to limit the operation of that Act or make it subject to such conditions, exceptions and qualifications as might be deemed expedient. That flexibility was reflected in Australian extradition legislation. As this Court observed in Oates v Attorney-General (Cth)21: "the legislation has always allowed for extradition arrangements with particular states to be subject to limitations, conditions, exceptions or qualifications seen as appropriate to the particular circumstances." A limitation, condition, exception or qualification applied by operation of a regulation made under s 11 may have the effect that the surrender of the person in relation to the offence must be refused in certain circumstances. Section 22(3)(e) provides that in such a case the person is not to be surrendered in relation to the offence unless the Minister is satisfied that the circumstances do not exist. The disempowering circumstance said, by the respondent, to exist in this case is that the offence of "war crime" for which his extradition was sought was not an offence in Hungary at the time of the acts or omissions said to give rise to it. The primary question in this appeal is whether the Minister committed a jurisdictional error by purporting to determine that the respondent is to be surrendered in circumstances in which a necessary condition for surrender, derived from Art 2.5 of the Treaty and, by operation of s 11 of the Act and reg 4 of the Regulations read with s 22(3)(e) of the Act, qualifying the powers conferred by the Act, had not been satisfied. It is necessary to consider the relevant terms of the Treaty and to do so in light of the rules of interpretation in the Vienna Convention on the Law of Treaties ("the Vienna Convention"). The approach to interpretation Australia and the Republic of Hungary are, and were at the time they entered into the Treaty, parties to the Vienna Convention22. Both may therefore be taken to have entered into the Treaty on the basis that the rules of interpretation of treaties, set out in Arts 31 and 32 of the Vienna Convention, would apply to it. The relevant elements of Arts 31 and 32 are: 21 (2003) 214 CLR 496 at 509 [31] per Gleeson CJ, McHugh, Gummow, Kirby, 22 Australia acceded to the Vienna Convention on 13 June 1974; the Republic of Hungary acceded on 19 June 1987. "Article 31 General rule of interpretation A treaty shall be interpreted in good faith in accordance with the ordinary meaning to be given to the terms of the treaty in their context and in the light of its object and purpose. There shall be taken into account, together with the context: any subsequent agreement between the parties regarding the the application of its interpretation of the treaty or provisions; any subsequent practice in the application of the treaty which establishes the agreement of the parties regarding its interpretation; any relevant rules of international law applicable in the relations between the parties. A special meaning shall be given to a term if it is established that the parties so intended. Article 32 Supplementary means of interpretation Recourse may be had to supplementary means of interpretation, including the preparatory work of the treaty and the circumstances of its conclusion, in order to confirm the meaning resulting from the application of article 31, or to determine the meaning when the interpretation according to article 31: leaves the meaning ambiguous or obscure; or to a leads unreasonable." result which is manifestly absurd or The rules of interpretation in Arts 31 and 32 have been said to represent customary international law23. Whether or not they are or have been adopted as 23 Sovereignty Over Pulau Ligitan and Pulau Sipadan (Indonesia v Malaysia) (Judgment) [2002] ICJ Rep 625 at 645. law24. The common part of the common law of Australia, those rules are generally consistent with the common to be construed "unconstrained by technical rules of English law, or by English legal precedent, but on broad principles of general acceptation"25. That was the approach adopted by Dawson J in Applicant A v Minister for Immigration and Ethnic Affairs26 who observed that: law requires treaties "Article 31 plainly precludes the adoption of a literal construction which would defeat the object or purpose of a treaty and be inconsistent with the context in which the words being construed appear." McHugh J, with whom Brennan CJ agreed in this respect27, said the correct approach to Art 31 was "a single combined operation which takes into account all relevant facts as a whole."28 It is that approach which is appropriate to the construction of Art 2.5(a) of the Treaty. 24 As to the relationship between customary international law and the common law, see Chow Hung Ching v The King (1948) 77 CLR 449 at 462 per Latham CJ, 471 per Starke J, cf at 477 per Dixon J; [1948] HCA 37. 25 Shipping Corporation of India Ltd v Gamlen Chemical Co A/Asia Pty Ltd (1980) 147 CLR 142 at 159 per Mason and Wilson JJ, Gibbs J agreeing at 149, Aickin J agreeing at 168, citing James Buchanan & Co Ltd v Babco Forwarding & Shipping (UK) Ltd [1978] AC 141 at 152 per Lord Wilberforce; [1980] HCA 51. See also Chan v Minister for Immigration and Ethnic Affairs (1989) 169 CLR 379 at 413 per Gaudron J; [1989] HCA 62. 26 (1997) 190 CLR 225 at 240; [1997] HCA 4. 27 (1997) 190 CLR 225 at 231. 28 (1997) 190 CLR 225 at 254 (emphasis in original), citing Judge Zekia in Golder v United Kingdom (1975) 1 EHRR 524 at 544. See also The Commonwealth v Tasmania (The Tasmanian Dam Case) (1983) 158 CLR 1 at 177 per Murphy J; [1983] HCA 21; Riley v The Commonwealth (1985) 159 CLR 1 at 15 per Deane J; [1985] HCA 82; Thiel v Federal Commissioner of Taxation (1990) 171 CLR 338 at 349 per Dawson J, 356-357 per McHugh J; [1990] HCA 37; Victoria v The Commonwealth (Industrial Relations Act Case) (1996) 187 CLR 416 at 545-546 per Brennan CJ, Toohey, Gaudron, McHugh and Gummow JJ; [1996] HCA 56; Oates v Attorney-General (Cth) (2003) 214 CLR 496 at 512 [43] per Gleeson CJ, McHugh, Gummow, Kirby, Hayne and Heydon JJ. The Treaty on Extradition between Australia and the Republic of Hungary The Treaty was made at Budapest on 25 October 1995 and entered into force on 25 April 1997. It reflects, according to its recital, the desire of both countries to make more effective their cooperation in the suppression of crime. Article 1 sets out their primary obligation. That obligation is to extradite to each other, subject to the provisions of the Treaty, any persons found in the territory of one of the contracting states who is wanted for prosecution by a competent authority for, or who has been convicted of, an extraditable offence against the law of the other contracting state. Article 2.1 embodies a dual criminality29 requirement in its definition of "extraditable offences" as "offences however described which are punishable under the laws of both Contracting States". That definition, and the dual criminality requirement which it embodies, are important elements of the context in which Art 2.5(a) is to be construed. Dual criminality is a requirement usually included in extradition treaties, according to which extradition is only granted in respect of an act or omission which is a crime according to the law of the state which is asked to extradite as well as of the state which demands extradition. As Professor Bassiouni, a leading authority in the field of international law and practice relating to extradition, has written30: "Dual criminality embodies a reciprocal characterization of those offenses deemed extraditable. Treaties list or otherwise designate extraditable offenses and also require dual criminality. Both of these requirements characteristically contain an implicit element of mutuality." (footnote omitted) It is not necessary to that mutuality that the conduct the subject of a request for extradition constitute a crime with the same name or designation in both the The dual criminality requirement has become so widespread in treaties and domestic extradition statutes since its emergence in the nineteenth century that it is said to have become a customary rule of international law 32. Absent any 29 Sometimes also referred to as "double criminality". 30 Bassiouni, International Extradition: United States Law and Practice, 5th ed 31 Jennings and Watts (eds), Oppenheim's International Law, 9th ed (1992), vol 1 at 32 Shearer, Extradition in International Law (1971) at 138; Bassiouni, International Extradition: United States Law and Practice, 5th ed (2007) at 497. express provision in an extradition treaty it may be implied33. Nevertheless the answer to the question whether dual criminality is required by an extradition treaty and a domestic statute giving effect to it will depend upon the terms of the treaty and of the statute34. So too will the extent of its application and its precise content. As Gleeson CJ, McHugh and Heydon JJ said in Truong v The Queen35: "this is a general principle of extradition law which is ordinarily reflected in statutes governing extradition, and applies according to the terms of the relevant statute." Dual criminality, as a general rule, does not mandate precise correspondence between the names or the elements of the corresponding offences in the requesting and in the requested states. Deane J in Riley v The Commonwealth said36: "The principle of double criminality is satisfied where, and only where, any alleged offence against the law of the requesting state in respect of which extradition is sought would necessarily involve a criminal offence against the law of the requested state if the acts constituting it had been done in that state." In describing contemporary treaty practice in this respect, Professor Bassiouni has written37: "Since the common crimes variety are invariably listed or designated in treaties, the two requirements of extraditable offense and dual criminality, whenever broadly interpreted, are satisfied by a single test, ie, the conduct is criminal in the jurisprudence of both states, even though not defined identically." That does not go so far as to say that the dual criminality requirement is satisfied simply on the basis that the offending conduct contravenes the criminal law of 33 Shearer, Extradition in International Law (1971) at 138. 34 Riley v The Commonwealth (1985) 159 CLR 1 at 12 per Gibbs CJ, Wilson and Dawson JJ, Brennan J agreeing at 14, Deane J agreeing at 14. 35 (2004) 223 CLR 122 at 136 [11]; [2004] HCA 10. See also Aughterson, Extradition: Australian Law and Procedure (1995) at 60. 36 (1985) 159 CLR 1 at 18. 37 Bassiouni, International Extradition: United States Law and Practice, 5th ed both the requesting and the requested states. Nor does it suggest that dual criminality is satisfied regardless of disparities between the definitions, content and seriousness of the offences constituted by that conduct in each state. Relevantly to this appeal, Professor Bassiouni points to a link between dual criminality and retroactive criminal law. A person the subject of a request for extradition may claim that, at the time of the alleged offence, it was not a crime under the laws of either the requesting or requested state. That class of argument is said to raise a valid defence on general grounds of "principles of legality"38. The "principles of legality" are reflected in international law which, as Brennan J observed in Polyukhovich v The Commonwealth39: "condemns as offensive to human rights retrospective municipal criminal law imposing a punishment for crime unless the crime was a crime under international law at the time when the relevant act was done." The qualification is important. It is found in Art 15 of the International Covenant on Civil and Political Rights which, while proscribing retroactive criminal laws, provides in Art 15(2) that: "Nothing in this article shall prejudice the trial and punishment of any person for any act or omission which, at the time when it was committed, was criminal according to the general principles of law recognized by the community of nations." No submission was made in this appeal that principles of international law qualifying the proscription of retroactive municipal criminal law had any part to play in the construction of the Treaty. That is perhaps not surprising as the Treaty is one of general application to a range of offences without distinction between those which might be regarded as crimes against international law and those which might not. Particular provisions of the Act impose a dual criminality requirement in relation to the Minister's decision whether or not to issue a notice in response to an extradition request40 and in relation to the magistrate's determination of eligibility for surrender41 . The requirement so imposed is that if the conduct 38 Bassiouni, International Extradition: United States Law and Practice, 5th ed 39 (1991) 172 CLR 501 at 575; [1991] HCA 32. 40 Act, s 16(2)(a)(ii). 41 Act, s 19(2)(c). constituting the extradition offence had taken place in Australia at the time of the extradition request it, or equivalent conduct, would have constituted an extradition offence in relation to Australia42. It is not necessary for present purposes to determine the extent to which that statutory requirement can be modified in its application by a regulation made under s 11 and whether it has been so modified by reg 4. The statutory provision which is in issue for present purposes is s 22 of the Act and in particular s 22(3)(e). Consideration of the provisions of s 22(3)(e) directs attention to the terms of the Treaty. The dual criminality requirement imposed by Art 2.1 is explained and qualified for the purposes of the Treaty by Art 2.2 which provides: "For the purpose of this Article in determining whether an offence is an offence against the law of both Contracting States: it shall not matter whether the laws of the Contracting States place the acts or omissions constituting the offence within the same category of offence or denominate the offence by the same terminology; the totality of the acts or omissions alleged against the person whose extradition is sought shall be taken into account and it shall not matter whether, under the laws of the Contracting States, the constituent elements of the offence differ." The requirement is further qualified, in relation to revenue offences by Art 2.3, and in relation to extraterritorial offences by Art 2.4. Article 2.5 may be viewed as a further qualification or elaboration of the dual criminality requirement. It has the effect that the offence in relation to which extradition is sought need not have been a criminal offence in the requested state at the time that it occurred provided that it was an offence in that state when the request for extradition was made. Art 2.5 provides: "Extradition may be granted pursuant to the provisions of this Treaty irrespective of when the offence in relation to which extradition is sought was committed, provided that: 42 Section 10(3)(a) of the Act provides that, for the purpose of considering conduct or equivalent conduct, regard may be had to all or to only one or some of the relevant acts or omissions. Section 10(3)(b) provides that differences in the denomination or categorisation of offences in Australia and the requesting state are to be disregarded. it was an offence in the Requesting State at the time of the acts or omissions constituting the offence; and the acts or omissions alleged would, if they had taken place in the territory of the Requested State at the time of the making of the request for extradition, have constituted an offence against the law in force in that State." The respondent submitted that pars (a) and (b) of Art 2.5 are addressed to different issues and different points in time. That submission should not be accepted. It detaches Art 2.5(a) from its context in Art 2.5 and the rest of Art 2. It is inconsistent with the holistic approach to interpretation adopted by Brennan CJ and McHugh J in Applicant A. Article 2.5(a) should be regarded as a proviso or condition upon which Art 2.5 dispenses with a requirement for dual criminality at the time of the commission of the acts or omissions said by the requesting state to constitute the extradition offence. It may be noted that the existence of such a requirement was a feature of the Extradition Act 1870 (UK) and the Extradition Act 1989 (UK)43. As a matter of ordinary grammatical construction the proviso in Art 2.5(a) requires that the "offence in relation to which extradition is sought", mentioned in the chapeau to Art 2.5, was an offence in the requesting state at the time of the acts or omissions said to constitute the offence. The Minister submitted that the term "the offence in relation to which extradition is sought" is to be read, by reference to Art 2.2, as meaning the "acts or omissions constituting the offence". On that basis the Minister submitted that the enquiry required by Art 2.5(a) is whether, when the acts or omissions constituting the offence for which extradition is sought took place, those acts or omissions constituted an offence in the requesting state. The proviso, it was submitted, did not require that extradition be sought for an offence under the same law or in identical terms, only that the conduct in question was criminal at the time it occurred. Subject to one qualification, the Minister's submission should not be accepted. As observed earlier in these reasons, dual criminality, in international practice, does not require precise correspondence between the offence constituted by the conduct of the offender in the requesting state and the offence which would be committed if the conduct had occurred in the requested state. A rule of precise correspondence would involve the requested state in undertaking close 43 R v Bow Street Metropolitan Stipendiary Magistrate; Ex parte Pinochet Ugarte (No 3) [2000] 1 AC 147 at 195-196 per Lord Browne-Wilkinson, Lord Goff of Chieveley agreeing at 208, Lord Hope of Craighead agreeing at 230, Lord Saville of Newdigate agreeing at 265, Lord Millett agreeing at 268, Lord Phillips of Worth Matravers agreeing at 279. scrutiny of its own and the foreign law. That involves the risk of acontextual interpretation of the foreign law. As McHugh J said in Theophanous v Herald & Weekly Times Ltd44: "The true meaning of a legal text almost always depends on a background of concepts, principles, practices, facts, rights and duties which the authors of the text took for granted or understood, without conscious advertence, by reason of their common language or culture." Consistently with the avoidance of illusory precision the words "it was an offence in the Requesting State" in Art 2.5(a) can be construed broadly to encompass versions earlier in time of the "offence in relation to which extradition is sought" which is referred to in the chapeau to Art 2.5. That broad approach will not encompass an offence created after the offending conduct which is qualitatively different from the offence constituted by that conduct at the time that that conduct was committed. The distinction, which also gives practical effect to the general principle against retroactive municipal criminal law, involves a judgment of degree. There is a point at which the offence in the requesting state at the time of the relevant conduct cannot be equated to the "offence in relation to which extradition is sought". Whatever that judgment may be in this case it cannot proceed on the basis that if the conduct of the respondent constituted some species of criminal offence at the time it was committed, that circumstance will be sufficient to support a request for extradition in relation to any species of offence later created by law and retroactively covering that conduct. The request for the extradition of the respondent for commission of a war crime cannot rest simply upon the proposition that the alleged conduct would have constituted the offence of murder under Hungarian law in 1944. Yet, as reflected in the departmental submission to the Minister mentioned below, and the Minister's submission in this Court, that was evidently the basis upon which the Minister made his decision. Counsel for the Minister conceded that if the construction of Art 2.5(a) for which he contended was not correct and the matter were remitted to the Minister, the Minister would be required to ascertain whether the law creating the offence of "war crime", allegedly committed by the respondent, was only a minor variation of pre-existing law. The Minister also sought to draw support for his construction from Art 3 of the Treaty. That Article sets out exceptions to extradition on a number of grounds, including the ground that "final judgement has been passed in the Requested State or in a third state in respect of the offence for which the person's 44 (1994) 182 CLR 104 at 196; [1994] HCA 46. In particular, see Riley v The Commonwealth (1985) 159 CLR 1 at 16 per Deane J. extradition is sought"45. It was submitted, correctly, that the reference in that paragraph to "the offence for which the person's extradition is sought" only makes sense if read as a reference to the acts or omissions constituting that offence. A similar argument was advanced by reference to Art 3.2(b), (d) and (e). Those paragraphs refer to cases in which the requested state has decided to refrain from prosecuting a person for the offence in respect of which extradition is sought46 or in which the offence is regarded under the law of the requested state as having been committed in whole or in part within that state47 or where a prosecution is pending in respect of that offence in the requested state48. These are textual indicators for, but not determinative in favour of, the construction propounded by the Minister. The Minister sought support for his interpretation of Art 2.5(a) in a "subsequent agreement" between Australia and the Republic of Hungary. He invoked Art 31(3) of the Vienna Convention. The subsequent agreement was said to have been reflected in a departmental submission which advised the Minister that the "conduct-based" interpretation of Art 2.5(a) of the Treaty "appears consistent with the view taken by the Hungarian Government." The submission also recorded that the Ministry of Justice in Hungary had indicated that it believed the request was not precluded by Art 2.5(a) given that "it can be established that the action [allegedly] committed by Zentai was an offence even at the time of its commission."49 The Minister also relied upon the fact that the request by Hungary was itself based upon the premise that the requirements of Art 2.5(a) of the Treaty had been met, a premise accepted by Australia by way of the Minister's determination under s 22 of the Act. It may be debatable whether the making of a request for extradition and the accession to that request on the basis of a common opinion about the interpretation of the Treaty requires that opinion to be taken into account in interpreting the Treaty. That seems to have been the proposition underlying the Minister's invocation of Art 31(3) of the Vienna Convention. For the purposes of Australian domestic law and the application of s 11 of the Act and reg 4 of the Regulations, the Treaty is to be interpreted in the light of its text, context and purpose as at the time that reg 4 was made and by reference to such extrinsic 45 Treaty, Art 3.1(d). 46 Treaty, Art 3.2(b). 47 Treaty, Art 3.2(d). 48 Treaty, Art 3.2(e). 49 The submission was forwarded to the Minister on 6 November 2009: (2011) 195 FCR 515 at 535 [83] per Jessup J. material as was in existence at that time. Any later agreement which had the effect of varying the terms of the Treaty would not affect the application of the Act unless s 11 were enlivened by a further regulation or some other statutory means. The appeal being dismissed, it is not necessary to consider the matters raised in the notice of contention. Conclusion For the preceding reasons the appeal should be dismissed with costs. Crennan Bell GUMMOW, CRENNAN, KIEFEL AND BELL JJ. The first respondent, Charles Zentai, is an Australian citizen whose extradition is sought by the Republic of Hungary for prosecution50 for an offence described as a "war crime". The acts that are said to constitute the offence occurred in 1944 and involved a fatal assault on a young Jewish man. At the time, there was no offence of "war crime" but murder was an offence under the Hungarian Criminal Code51. The Republic of Hungary has chosen not to seek Mr Zentai's surrender for prosecution for murder. The fact that the Republic of Hungary has requested that Mr Zentai be surrendered for prosecution for the offence of "war crime" gives rise to the issue in this appeal. That issue concerns the effect of a limitation on the power of the first appellant, the Minister for Home Affairs ("the Minister"), to comply with the request. The limitation arises out of the Extradition Act 1988 (Cth) ("the Act"), which gives effect to Art 2.5(a) of the Treaty on Extradition between Australia and the Republic of Hungary ("the Treaty"). Article 2.5(a) of the Treaty states that extradition may be granted irrespective of when the offence in relation to which extradition is sought was committed, provided that it was an offence in the Requesting State at the time the acts constituting it occurred52. Factual background The request for the extradition of Mr Zentai was made by the Hungarian Ministry of Justice in a letter dated 23 March 2005. An English translation of an arrest warrant issued by the Military Division of the Metropolitan Court of Budapest was attached to the letter. Particulars of the offence for which Mr Zentai's extradition is sought are set out in the warrant. They concern an incident that is alleged to have occurred in Budapest on 8 November 1944 at a time when it appears that Mr Zentai was a member of the Hungarian Royal Army. He is said to have captured a young man, Peter Balazs, whom he recognised as a Jew, and to have dragged him back to his unit's post. There, he and two other soldiers carried out a sustained, fatal, assault on Mr Balazs, after which Mr Zentai assisted in weighting down the body and throwing it into the Danube River. 50 In this Court (although not below) it was accepted that Mr Zentai's extradition is sought as a person "wanted for prosecution", as to which see Director of Public Prosecutions (Cth) v Kainhofer (1995) 185 CLR 528 at 562-563 per Gummow J; [1995] HCA 35. 51 Under Art 278 of Act V of 1878 of the Hungarian Criminal Code. 52 Extradition (Republic of Hungary) Regulations (Cth), reg 4 and Schedule, Treaty on Extradition between Australia and the Republic of Hungary. Crennan Bell The offence of war crime The offence of "war crime" for which Mr Zentai's extradition is sought was first enacted in 194553 and has since been re-enacted in the Hungarian Criminal Code in 197854. The offence is described in the arrest warrant as having the following characteristics: "A person who seriously violated international legal rules applicable to war in respect of the treatment of the population of the occupied territories or prisoners of war, or treated the population of the reannexed territories barbarously, misusing the power granted to him, or who was an instigator, perpetrator or accomplice of the unlawful execution or torture of persons either in Hungary or abroad". The provisions operate retrospectively. The offence carries a "main life, or imprisonment from ten punishment" of "imprisonment for fifteen years". Proceedings under the Extradition Act Part I of the Act (ss 1-11) deals with preliminary matters. One of the principal objects of the Act is "to enable Australia to carry out its obligations under extradition treaties"55. Section 5 relevantly defines "extradition offence" to include an offence in relation to a country other than Australia "for which the maximum penalty is death or imprisonment, or other deprivation of liberty, for a period of not less than 12 months". That requirement is satisfied in this case. Part II of the Act (ss 12-27) governs extradition from Australia to an extradition country. The scheme has been described as proceeding in four interdependent stages: commencement, remand, determination by a magistrate of eligibility for surrender and executive determination (subject to legislative constraints) that the person is to be surrendered56. Aspects of the operation of 53 Prime Minister's Decree No 81 of 1945, enacted by Act VII of 1945 and amended and complemented by Decree No 1440 of 1945. 54 Section 165 of Act IV of 1978. 55 Act, s 3(c). 56 Harris v Attorney-General (Cth) (1994) 52 FCR 386 at 389. Crennan Bell each stage have been discussed on a number of occasions by this Court57. This appeal is concerned with the fourth stage, the executive determination to surrender for extradition. The earlier stages may be briefly noticed. On 8 July 2005, the former Minister for Justice and Customs issued a notice of receipt of the extradition request58 in respect of a "war crime" and referred to the relevant Hungarian legislation set out in the warrant. Mr Zentai was arrested on a provisional warrant59 and granted conditional bail60. Mr Zentai made an unsuccessful challenge to the validity of the conferral of certain functions under the Act on State magistrates, which proceeding concluded in April 200861. On 20 August 2008, the second respondent, a magistrate, determined that Mr Zentai was eligible for extradition to Hungary and issued a warrant committing him to prison pursuant to s 19(9) of the Act. Such a determination is a precondition which must be satisfied before the Minister can surrender an individual pursuant to s 22 of the Act. Mr Zentai applied for a review of the magistrate's determination under s 21 of the Act and he was released on bail pending the outcome of that review. The magistrate's determination was affirmed in the Federal Court by Gilmour J62 and an appeal from that decision was dismissed by the Full Court of the Federal Court63. 57 Director of Public Prosecutions (Cth) v Kainhofer (1995) 185 CLR 528; Oates v Attorney-General (Cth) (2003) 214 CLR 496; [2003] HCA 21; Truong v The Queen (2004) 223 CLR 122; [2004] HCA 10; Vasiljkovic v The Commonwealth (2006) 227 CLR 614; [2006] HCA 40; O'Donoghue v Ireland (2008) 234 CLR 599; [2008] HCA 14; Republic of Croatia v Snedden (2010) 241 CLR 461; [2010] HCA 14. 58 Act, s 16. 59 Act, s 12(1). 60 Act, s 15(2). 61 O'Donoghue v Ireland (2008) 234 CLR 599. 62 Zentai v Republic of Hungary [2009] FCA 284. 63 Zentai v Republic of Hungary (2009) 180 FCR 225. Crennan Bell Following receipt of the request for Mr Zentai's extradition, it appears that the Department of the Attorney-General raised with the Hungarian authorities the question of whether the conduct alleged against Mr Zentai amounted to an offence against Hungarian law at the date of its alleged commission. By July 2005, the Department had received advice that in 1944 the conduct particularised in the arrest warrant constituted the crime of murder under the Hungarian Criminal Code. In August 2009, lawyers acting for Mr Zentai wrote to the Department of the Attorney-General contending that Mr Zentai's surrender for extradition for the offence of "war crime" was precluded under the proviso in Art 2.5(a) of the Treaty, which states: "Extradition may be granted pursuant to the provisions of this Treaty irrespective of when the offence in relation to which extradition is sought was committed, provided that: it was an offence in the Requesting State at the time of the acts or omissions constituting the offence". Officers of the Department advised the Minister respecting this contention in these terms: "Although [Mr Zentai's] interpretation is arguably open on the basis of the language used in Article 2(5), when considered in the context of the provision, and its background, our view is that Article 2(5) does not preclude extradition. … We do not consider Article 2(5)(a) requires that the precise offence provision under which the person is to be prosecuted had to be in force at the time the relevant conduct was committed." It would seem that the Minister accepted the Department's advice. On 12 November 2009, acting under a delegation from the Attorney-General, the Minister determined that Mr Zentai was to be surrendered to Hungary in relation to the extradition offence of "war crime"64. Mr Zentai commenced proceedings in the Federal Court of Australia under s 39B(1) and (1A) of the Judiciary Act 1903 (Cth) claiming an order quashing the Minister's decision to surrender him and declaring the decision to 64 Act, s 22(2). Crennan Bell have been "void and of no legal effect"65. He was granted bail on 16 December On 2 July 2010, McKerracher J found that it had not been open to the Minister to surrender Mr Zentai for extradition because the offence of "war crime" was not an offence under the laws of Hungary at the time Mr Balazs was killed66. On 10 December 2010, his Honour ordered certiorari to quash the Minister's determination (and the warrant issued upon it)67 and mandamus requiring the Minister to determine (i) that Mr Zentai not be surrendered to Hungary and (ii) that Mr Zentai be released68. His Honour made declarations including that the offence for which Mr Zentai's extradition is sought is not an "extraditable offence"69. The Minister appealed to the Full Court of the Federal Court contending that McKerracher J erred in his construction of the Treaty and in his conclusion that it had not been open to determine that Mr Zentai is to be surrendered for extradition in relation to the offence of "war crime". On 16 August 2011, the Full Court of the Federal Court (Besanko and Jessup JJ, North J dissenting) made orders allowing the Minister's appeal in part and varying the orders made by the primary judge but otherwise dismissing the appeal. Besanko and Jessup JJ concluded that McKerracher J was correct in holding that the offence for which 65 Orders were also sought against the Minister for Justice in relation to the decision to issue the notice under s 16; the magistrate in relation to the issue of the warrant committing Mr Zentai to custody to await surrender under s 19(9); and the officer in charge of Hakea Prison in Western Australia to produce Mr Zentai to the Court. This appeal is concerned only with the relief claimed against the Minister arising out of the determination under s 22(2) to surrender Mr Zentai to Hungary for extradition. 66 Zentai v O'Connor (No 3) (2010) 187 FCR 495 at 541 [186], 545 [214]. 67 Which repeated the description of the extradition offence as a "war crime" and set out the relevant Hungarian legislation as in the s 16 notice. 68 Zentai v O'Connor (No 4) [2010] FCA 1385. 69 Zentai v O'Connor (No 4) [2010] FCA 1385 at [88]. Crennan Bell extradition was sought must have been an offence under Hungarian law at the time of the acts alleged to constitute it70. On 2 December 2011, this Court ordered by consent that, pending the determination of the appellants' application for special leave to appeal and, if special leave were granted, pending the determination of the appeal, the order of the Full Court that a writ of mandamus issue to the Minister be stayed; Mr Zentai be admitted to bail upon conditions; and the s 19(9) warrant issued by the magistrate on 20 August 2008 committing Mr Zentai to imprisonment in Hakea Prison be stayed. On 9 December 2011, French CJ, Gummow and Bell JJ granted the appellants special leave to appeal from the orders of the Full Court made on 16 August 2011. For the reasons that follow, the appeal should be dismissed. The Minister did not give reasons for his determination. It is not a decision to which the Administrative Decisions (Judicial Review) Act 1977 (Cth) applies71. By Notice of Contention, Mr Zentai seeks to have the orders of the Full Court upheld on the ground that the Minister did not "provide a statement of reasons explaining and justifying his decision of 12 November 2009". Mr Zentai asserts that the conferral of a public power unaccompanied by an express or implied obligation to explain the purported exercise of the power is to "create islands of power immune from supervision and restraint"72. Given the fate of the appeal, it is not necessary to address Mr Zentai's contention beyond observing that his successful challenge to the Minister's purported exercise of the power tends against acceptance of the premise of his argument. The power to surrender for extradition The determination with which this appeal is concerned was made under s 22(2) of the Act, which requires the Attorney-General (in this case, the Minister) to determine as soon as is reasonably practicable after a person becomes an eligible person whether the person is to be surrendered in relation to a qualifying extradition offence. Mr Zentai is an eligible person, having been 70 O'Connor v Zentai (2011) 195 FCR 515 at 531 [71] per Besanko J, 571 [160] per 71 Administrative Decisions (Judicial Review) Act 1977 (Cth), s 3, par (d) of the definition of "decision to which this Act applies" and Sched 1, par (r). 72 Kirk v Industrial Court (NSW) (2010) 239 CLR 531 at 581 [99]; [2010] HCA 1. Crennan Bell committed to prison by order of a magistrate made under s 19(9)73. The qualifying extradition offence for the purposes of the determination is the offence of "war crime", since this is the extradition offence in relation to which the magistrate determined Mr Zentai is eligible for surrender74. reflect principles The Minister's power to determine to surrender Mr Zentai for extradition is subject to the limitations and conditions that are set out in s 22(3). These limitations and conditions apply to the extradition of persons from Australia to any extradition country and internationally acknowledged in extradition law75. They include that the Minister may not extradite a person to face prosecution or punishment for a political offence in the extradition country76. Nor may the Minister surrender a person for extradition where extradition is sought for the purpose of prosecuting or punishing the person on account of his or her race, religion, nationality or political opinions or where the person may be prejudiced at his or her trial or punished on account of such considerations77. Nor may the Minister surrender a person for extradition unless the Minister is satisfied that the person will not be subjected to torture78. that are 73 Section 22(1) of the Act defines "eligible person" to mean, relevantly, a person who has been committed to prison: "by order of a magistrate made under subsection 19(9) or required to be made under subparagraph 21(2)(b)(ii) (including by virtue of an appeal referred to in section 21), being an order in relation to which no proceedings under section 21 are being conducted or available." 74 Section 22(1) of the Act defines "qualifying extradition offence" to mean, relevantly, in relation to an eligible person, any extradition offence: "in relation to which the magistrate referred to in that paragraph or the court that conducted final proceedings under section 21, as the case requires, determined that the person was eligible for surrender within the meaning of subsection 19(2)." 75 United Nations General Assembly, Model Treaty on Extradition (A/RES/45/116) 14 December 1990. 76 Act, ss 7(a), 7(b), 22(3)(a). 77 Act, ss 7(b), 7(c), 22(3)(a). 78 Act, s 22(3)(b). Crennan Bell Nor may the Minister surrender a person for extradition where the offence is punishable by a penalty of death unless the extradition country has provided an undertaking having the effect that the death penalty will not be carried out79. More generally, the principles of speciality80, double jeopardy81 and double criminality82 also find expression in the limitations and conditions on the Minister's power to surrender a person for extradition to any extradition country. The last-mentioned principle prevents extradition unless the act or omission that is the subject of the request amounts to a crime under the laws of the Requesting and the Requested State83. Consideration of whether conduct constitutes an offence under Australian law is directed to the time at which the extradition request is received84. The limitations on the power to surrender a person for extradition under the Act are not concerned with whether the person may be exposed to criminal punishment for conduct that was not a crime at the time it took place. However, as earlier stated, Australia and Hungary have agreed to limit their mutual obligation to surrender persons for extradition by such a consideration. The proviso in Art 2.5(a) which protects against surrender in the case of threatened imposition of criminal liability or punishment retrospectively is given effect in Australian law by the operation of ss 11(1)(a) and 22(3)(e) of the Act. The former provides that regulations may state that the Act applies in relation to a specified extradition country subject to such limitations, conditions, exceptions or qualifications as are necessary to give effect to a bilateral extradition treaty. This may be achieved by a regulation that provides that the Act applies to the country concerned subject to such a treaty85. This is the manner in which Australia has effected its extradition arrangements with Hungary. The Extradition (Republic of Hungary) Regulations (Cth) ("the Regulations") declare 79 Act, s 22(3)(c). 80 Act, s 22(3)(d). 81 Act, ss 7(e), 22(3)(a). 82 Act, ss 7(d), 22(3)(a). 83 Truong v The Queen (2004) 223 CLR 122 at 136 [11], citing Oppenheim's International Law, 8th ed (1955), vol 1 at 701. 84 Act, ss 7(d), 16(2)(a)(ii). 85 Act, s 11(1C). Crennan Bell Hungary to be an extradition country86 and provide that the Act applies in relation to Hungary subject to the Treaty, which is set out in the Schedule87. Article 2.5(a) embodies a general objection to retrospectively applied criminal law that is recognised both in municipal law88 and in international instruments, including the European Convention on Human Rights89 ("the ECHR"). Under the ECHR, the general objection is subject to an exception in the case of acts or omissions which at the time they were done or omitted to be done were criminal according to the general principles of law recognised by civilised nations90. This exception, which is apt to cover conduct recognised under international law as amounting to a war crime, does not find expression in the Treaty. Section 22(3)(e) precludes the surrender of an eligible person in a case in which the Act applies in relation to the extradition country subject to a limitation, condition, qualification or exception having the effect that surrender in relation to the offence shall be refused in certain circumstances unless the Minister is satisfied that those circumstances do not exist91. In this case, the Minister's 86 Regulations, reg 3. 87 Regulations, reg 4. 88 Polyukhovich v The Commonwealth (1991) 172 CLR 501 at 609-612 per Deane J, 642-643 per Dawson J, 686-690 per Toohey J; [1991] HCA 32. See also Lipohar v The Queen (1999) 200 CLR 485 at 543 [142] per Kirby J; [1999] HCA 65; Haskins v The Commonwealth (2011) 244 CLR 22 at 48 [72] per Heydon J; [2011] HCA 28. See further R v Miah [1974] 1 WLR 683 at 694 per Lord Reid; [1974] 2 All ER 377 at 379. 89 Article 7.1 of the ECHR provides that: "No one shall be held guilty of any criminal offence on account of any act or omission which did not constitute a criminal offence under national or international law at the time when it was committed. Nor shall a heavier penalty be imposed than the one that was applicable at the time the criminal offence was committed." 90 ECHR, Art 7.2. 91 Section 22(3)(e) provides: "For the purposes of subsection (2), the eligible person is only to be surrendered in relation to a qualifying extradition offence if: (Footnote continues on next page) Crennan Bell power to determine to surrender Mr Zentai for extradition to Hungary was subject to his satisfaction of the existence of the circumstance stated in Art 2.5(a). The Federal Court The primary judge considered that the plain meaning of Art 2.5(a) precluded the determination to surrender a person for extradition for an offence that did not exist at the time the acts or omissions said to constitute it are alleged to have taken place92. The majority in the Full Court upheld this construction93. However, their Honours differed from the primary judge with respect to the form of the orders made to reflect this conclusion. The order for mandamus was reframed to direct the Minister to determine according to law whether Mr Zentai is to be surrendered to Hungary in relation to the offence of war crime. This recognises that it is for the Minister and not the Court to determine whether the offence of war crime was an offence in Hungary at the material time94. The declarations made by the primary judge were also set aside. North J, in dissent, approached the question upon a view that the object and purpose of the Treaty is "to ensure that people are called to account for their where, because of section 11, this Act applies in relation to the extradition country subject to a limitation, condition, qualification or exception that has the effect that: surrender of the person in relation to the offence shall be refused; … in certain circumstances – the Attorney-General is satisfied: (iii) where subparagraph (i) applies – that the circumstances do not exist". 92 Zentai v O'Connor (No 3) (2010) 187 FCR 495 at 544-545 [211], referring to 540- 93 O'Connor v Zentai (2011) 195 FCR 515 at 531 [70] per Besanko J, 570 [155] per 94 O'Connor v Zentai (2011) 195 FCR 515 at 573 [165] per Jessup J. Crennan Bell wrongdoing"95. His Honour interpreted Art 2.5(a) by reference to the Vienna Convention on the Law of Treaties, which provides that, in the interpretation of a treaty, any subsequent agreement between the parties regarding its interpretation or the application of its provisions is to be taken into account96. His Honour considered that Mr Zentai faced the hurdle of demonstrating that Art 2.5(a) bears a meaning that differs from the meaning upon which Australia and Hungary are agreed97. In his Honour's view, Arts 2.1 and 2.2 together define what constitutes an extraditable offence. Article 2.2(b) requires that the totality of the acts or omissions of the person whose extradition is sought are to be taken into account. It follows that the "offence in relation to which extradition is sought" in Art 2.5 is to be understood as referring to the totality of the acts or omissions that are said to constitute it. Since murder was an offence under the Hungarian Criminal Code in November 1944, the proviso in Art 2.5(a) was satisfied98. The Minister's submissions: the interpretive approach The Minister adopted North J's reasons in support of his submission that Art 2.5(a) precludes extradition only where the conduct constituting the offence for which extradition is sought was not an offence in the Requesting State at the time it occurred. The Minister relied on Art 31.3(a) of the Vienna Convention and submitted that it was evident that Australia and Hungary had reached a subsequent agreement that Art 2.5(a) is satisfied if the acts and omissions alleged against the person amounted to an offence in the Requesting State at the date they occurred. Hungary's agreement was evidenced by the fact of its request for extradition for the offence of "war crime", notwithstanding that the offence did not exist in 1944. Australia's agreement was evidenced by the Minister's accession to the extradition request. The Minister embraced North J's characterisation of the object and purpose of the Treaty and submitted that this favoured a broad and generous interpretation of its provisions, including Art 2.5(a). The latter, although stating a limitation on the circumstances in which surrender is to be granted, was to be interpreted as part of "a treaty between States [having] no direct impact upon liberty". 95 O'Connor v Zentai (2011) 195 FCR 515 at 521 [27]. 96 Vienna Convention on the Law of Treaties (1969), Art 31.3(a). 97 O'Connor v Zentai (2011) 195 FCR 515 at 519 [14]. 98 O'Connor v Zentai (2011) 195 FCR 515 at 521 [25]-[26]. Crennan Bell Discussion: the interpretive approach It is well settled that the Executive requires the authority of statute to surrender a person for extradition99 and that the power "cannot be exercised except in accordance with the laws which prescribe in detail the precautions to be taken to prevent unwarrantable interference with individual liberty" 100. The limitation on the power of surrender with which this appeal is concerned arises in consequence of the engagement of s 22(3)(e) and the Regulations made under s 11(1) annexing the Treaty. The meaning of the limitation set out in Art 2.5(a) is to be ascertained by the application of ordinary principles of statutory interpretation101. The limitation is not susceptible of altered meaning reflecting some understanding reached by the Ministry of Justice of Hungary and the Executive branch of the Australian Government. Moreover, it is an error to characterise the purpose of the Treaty as "ensur[ing] that people are called to account for their wrongdoing". The purpose of the Treaty stated in Art 1102 is to give effect to the reciprocal obligations to extradite persons for extraditable offences. Extraditable offences are defined in Art 2 and are subject to a limitation that does not apply to extradition from Australia for extradition 99 Barton v The Commonwealth (1974) 131 CLR 477 at 497 per Mason J; [1974] HCA 20; Oates v Attorney-General (Cth) (2003) 214 CLR 496 at 503-504 [13] per Gleeson CJ, McHugh, Gummow, Kirby, Hayne and Heydon JJ. 100 Brown v Lizars (1905) 2 CLR 837 at 852 per Griffith CJ; [1905] HCA 24. See also Riley v The Commonwealth (1985) 159 CLR 1 at 15 per Deane J; [1985] HCA 82; Vasiljkovic v The Commonwealth (2006) 227 CLR 614 at 618 [6] per Gleeson CJ, 634 [49] per Gummow and Hayne JJ. 101 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 381 [69] per McHugh, Gummow, Kirby and Hayne JJ; [1998] HCA 28; Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27 at 46-47 [47] per Hayne, Heydon, Crennan and Kiefel JJ; [2009] HCA 41. 102 Article 1 of the Treaty provides: "The Contracting States undertake to extradite to each other, subject to the provisions of this Treaty, any person found in the territory of one of the Contracting States who is wanted for prosecution by a competent authority for, or has been convicted of, an extraditable offence against the law of the other Contracting State." Crennan Bell offences under the Act103. Consideration of the object and purpose of the Treaty does not assist in ascertaining the meaning of that limitation. Article 2 At this point it is convenient to set out the relevant provisions of Art 2: "EXTRADITABLE OFFENCES For the purposes of this Treaty, extraditable offences are offences however described which are punishable under the laws of both Contracting States by imprisonment for a maximum period of at least one year or by a more severe penalty. Where the request for extradition relates to a person convicted of such an offence who is wanted for the enforcement of a sentence of imprisonment, extradition shall be granted only if a period of at least six months of such penalty remains to be served. For the purpose of this Article in determining whether an offence is an offence against the law of both Contracting States: it shall not matter whether the laws of the Contracting States place the acts or omissions constituting the offence within the same category of offence or denominate the offence by the same terminology; the totality of the acts or omissions alleged against the person whose extradition is sought shall be taken into account and it shall not matter whether, under the laws of the Contracting States, the constituent elements of the offence differ. Extradition may be granted pursuant to the provisions of this Treaty irrespective of when the offence in relation to which extradition is sought was committed, provided that: it was an offence in the Requesting State at the time of the acts or omissions constituting the offence; and 103 Act, s 5, par (a) of the definition of "extradition offence". Crennan Bell the acts or omissions alleged would, if they had taken place in the territory of the Requested State at the time of the making of the request for extradition, have constituted an offence against the law in force in that State." The Minister's submissions: three textual considerations In the Minister's submission, "offence" in the chapeau to Art 2.5(a) is not confined to the legal construct of "war crime" under Hungarian law, but encompasses the totality of the acts and omissions alleged against Mr Zentai in the extradition request. On this analysis, the proviso in Art 2.5(a) requires the Minister to ask, was the conduct that is alleged against Mr Zentai an offence under Hungarian law in 1944? This expansive interpretation is said to be justified by three textual considerations. First, Art 2.1, which speaks of "offences however described", demonstrates, so it is said, a focus on conduct as distinct from the legal analysis of an offence. Secondly, Art 2.2 is expressed to apply for "the purpose of this Article" and, in terms, directs attention to the conduct and not to analysis of the elements of an offence. Thirdly, the use of the word "offence" in Art 3104 is suggested to encompass the acts and omissions alleged 104 Article 3 relevantly provides: "1. Extradition shall not be granted in any of the following circumstances: if final judgement has been passed in the Requested State or in a third state in respect of the offence for which the person's extradition is sought; 2. Extradition may be refused in any of the following circumstances: if the competent authorities of the Requested State have decided to refrain from prosecuting the person for the offence in respect of which extradition is sought; (Footnote continues on next page) Crennan Bell against the person since otherwise the exclusions for which the Article provides would lose much of their utility. Discussion: three textual considerations Extradition treaties commonly define the offences for which extradition is to be granted. In some treaties, this is done by listing extraditable offences by name: "the enumerative method". One deficiency with the enumerative method is that, in the event an offence is omitted from the list, the Contracting States will usually have to undertake the time-consuming task of entering into a supplementary treaty. This deficiency is addressed by the adoption of the "eliminative method", by which extraditable offences are defined by reference to a minimum standard of severity105. The latter is the method adopted in the Treaty. Article 2.1 provides that an offence is an extraditable offence regardless of how the offence is described under the law of Australia or Hungary provided that it is an offence subject to a penalty of one year's imprisonment or more. Article 2.1 also gives effect to the principle of double criminality. One problem that arises in the application of double criminality is whether the offence must have the same name and constituent elements under the law of the Requested State or whether it is sufficient that the facts alleged against the person in the extradition request constitute a crime in the Requested State106. Article 2.2 answers this question. It applies "[f]or the purpose of this Article in determining whether an offence is an offence against the law of both Contracting States" (emphasis added). Differences in nomenclature and the identification of constituent elements are to be put aside when determining whether the offence for which the eligible person's extradition is sought is an offence in the Requested State. The determination of whether an offence is an offence against the law of both Contracting States, pertinent to the application of double criminality, has no relevance to the question with which Art 2.5(a) is concerned. There is no need to take account of dissimilar systems of criminal law under the if the offence for which extradition is sought is regarded under the law of the Requested State as having been committed in whole or in part within that State; if a prosecution in respect of the offence for which extradition is sought is pending in the Requested State against the person whose extradition is sought" (emphasis added). 105 See Shearer, Extradition in International Law (1971) at 133-137. 106 Shearer, Extradition in International Law (1971) at 141-146. Crennan Bell proviso in Art 2.5(a). Article 2.5(a) asks whether the offence for which extradition is sought (by the Requesting State) was an offence (in the Requesting State) at the time the acts or omissions said to constitute it occurred. The Minister's submissions respecting Art 3107 addressed par (d) of Art 3.1 and pars (b), (d) and (e) of Art 3.2. Each is concerned with the effect of decisions of courts or the Executive or the content of the law of the Requested State on the determination to surrender for extradition. As with the determination of double criminality, consideration of the offence for which extradition is sought by the Requesting State in this context may require that account be taken of the differences between systems of criminal justice108. Again, this provides no reason for giving an extended meaning to "the offence in relation to which extradition is sought" for the purposes of Art 2.5(a), which is concerned solely with the law of the Requesting State. The ordinary, grammatical, meaning of Art 2.5(a) is that extradition is not to be granted unless the Minister is satisfied that the offence in relation to which extradition is sought was an offence in the Requesting State at the time of its alleged commission. If the pronoun "it" is replaced with the phrase for which it is surrogate, Art 2.5(a) reads "extradition may be granted … irrespective of when the offence in relation to which extradition is sought was committed, provided that the offence in relation to which extradition is sought was an offence in the Requesting State at the time of the acts or omissions constituting the offence". Article 2.5(a) reflects the adoption by Australia and Hungary of a policy against the imposition of criminal liability or punishment retrospectively. Had the intention been to confine that protection to a consideration of whether the acts or omissions alleged against the eligible person constituted any offence against the law of the Requesting State at the time of their alleged commission, it might be expected that the opening words of Art 2.5(a) would have mirrored those of Art 2.5(b) (dealing with double criminality), which asks whether "the acts or omissions alleged would, if they had taken place in the territory of the Requested State … have constituted an offence". 107 See above at fn 104. 108 Riley v The Commonwealth (1985) 159 CLR 1 at 17 per Deane J; Vasiljkovic v The Commonwealth (2006) 227 CLR 614 at 633 [46] per Gummow and Hayne JJ. Crennan Bell Treatment of speciality under the Treaty The Minister's final submission in support of his preferred construction of Art 2.5(a) draws on Art 12109. That Article permits the conviction and punishment of an eligible person for an extraditable offence other than that for which extradition was granted where the person could be convicted upon proof of the facts on which the extradition request was based, provided that the offence does not carry a more severe penalty than the offence for which extradition was granted110. This treatment of the rule of speciality conforms to the treatment of the rule under the Act for extradition to Australia from other countries111. It is less restrictive than the treatment of the rule in the United Nations Model Treaty on Extradition112 and in the European Convention on Extradition113. The Minister contends that the more flexible approach to the rule of speciality in Art 12 supports his interpretation of Art 2.5(a) because it is consistent with "the whole tenor of the Treaty [which] is ... directed to the underlying facts for the offence and not just on legal constructs". However, the reservation in Art 12 109 Article 12(1) provides, relevantly: "a person extradited under this Treaty shall not be detained or tried, or be subjected to any other restriction of his personal liberty, in the territory of the Requesting State for any offence committed before his extradition other than: an offence for which extradition was granted or any other extraditable offence of which the person could be convicted upon proof of the facts upon which the request for extradition was based, provided that that offence does not carry a penalty which is more severe than that which could be imposed for the offence for which extradition was granted; or any other extraditable offence in respect of which the Requested State consents." 110 See Truong v The Queen (2004) 223 CLR 122. 111 Act, s 42. 112 United Nations General Assembly, Model Treaty on Extradition (A/RES/45/116) 14 December 1990, Art 14. 113 European Convention on Extradition (1957), Art 14. Crennan Bell tends against acceptance of the Minister's submission. The offence for which extradition is sought remains controlling in that the person may not be detained or tried for another extraditable offence having a more severe penalty. Conclusion The inquiry to which Art 2.5(a) directs attention is not whether the acts or omissions particularised in the request were capable of giving rise to any form of criminal liability under the laws of the Requesting State at the time they were committed, but whether, at that time, those acts or omissions constituted the offence for which extradition is sought. Hungary seeks Mr Zentai's surrender for extradition for the offence of "war crime". The facts set out in the arrest warrant, if proved, may support Mr Zentai's conviction for the offence of murder. However, Hungary has chosen not to request Mr Zentai's extradition for prosecution for that offence. Under Australian law as modified to give effect to the Treaty, the Minister is precluded from surrendering Mr Zentai for extradition unless he is satisfied that the offence of "war crime" was an offence against the law of Hungary on 8 November 1944. The appeal should be dismissed with costs. HEYDON J. The appeal should be allowed. Background Counsel for the first respondent referred to the "general antipathy in international law … against retrospectivity" – an antipathy which can be somewhat selectively displayed. Analysis should not be diverted by that antipathy in this case. Nor should analysis be diverted by the characteristic vagueness with which war crimes are defined. Finally, analysis should not be diverted by reflections upon the zeal with which the victors at the end of the Second World War punished the defeated for war crimes. The victors were animated by the ideals of the Atlantic Charter and of the United Nations. The Universal Declaration of Human Rights was about to peep over the eastern horizon. But first, they wanted to have a little hanging. At least in its application to the first respondent, the Prime Minister's Decree No 81 of 1945 ("the Decree") is not open to criticisms of retroactivity, vagueness or excessive zeal. The provision of the Decree that creates the crime in respect of which Hungary seeks the first respondent's extradition sets up three categories of offender. One is "[a] person who seriously violated international legal rules applicable to war in respect of the treatment of the population of the occupied territories or prisoners of war". The second category refers to a person who "treated the population of the reannexed territories barbarously, misusing the power granted to him". The third category refers to "an instigator, perpetrator or accomplice of the unlawful execution or torture of persons … in Hungary". The case Hungary puts against the first respondent places him in the third category, not the first two categories. Those first two categories are replete with indeterminate and even uncertain phrases. At least in its application to the facts alleged against the first respondent, the third category does not share those vices. The facts that Hungary alleges against the first respondent are as follows. On 8 November 1944, the first respondent: "provided patrol service in the territory of Budapest …, with the aim of capturing hiding persons of Jewish origin and presenting them at their place of service. In the course of his patrol service, [the first respondent], reserve ensign, recognized, on a tram line, [the victim], a young man of Jewish origin, also [like the first respondent] residing at Budafok, and known by him earlier, who did not wear the yellow star, which was otherwise prescribed for him on a mandatory basis. Thereafter, [the first respondent] dragged [the victim] to the army post of his Unit located at Budapest … Thereafter, [the first respondent] and his two other accomplices [both also officers], assaulted [the victim] in one of the offices of the Unit from about 3.00 p.m. until the evening hours continuously and so badly that [the victim] died of his injuries late in the evening. [The first respondent] delivered the dead body of [the victim] from the territory of the Unit on the same night together with his several fellow-soldiers, and then, after having fixed ballast to the dead body, they threw it into the Danube." The first respondent was a Hungarian citizen in 1944. He is alleged to have carried out this conduct on Hungarian soil. The alleged victim appears to have been a Hungarian citizen. Unlike the instruments relied on to try the major war criminals at Nuremburg and Tokyo after the Second World War, the Decree is legislation enacted by a competent legislator. The Decree is supported by the territorial and active personality principles of jurisdiction under international law. Although the Decree is retrospective in form, in substance, as it applies to this case, it merely repeats an existing prohibition against murder. Indeed, the crime the Decree created requires antecedently "unlawful" conduct. In this case, that conduct was murder. In 1946 the Allies hanged the former German Foreign Minister for crimes against peace. No doubt he was an unlovely character. No doubt other things that he may have done were repellent. But critics find the way he was forced to the scaffold unattractive because the existence of crimes against peace before 1945 was at best questionable. They also find it unattractive because the prosecution comprised four countries with very large empires, significant parts of which had been acquired by starting wars. That was an example of behaviour which gave war crimes trials a bad name. On the other hand, post-1949 German governments could not be criticised for punishing Germans who committed war crimes by murdering or physically maltreating Germans in Germany during the Second World War contrary to German law at that time. The same is true of post-1945 Hungarian governments seeking to punish Hungarians who murdered Hungarians in Hungary in 1944 – a time when the conduct alleged against the first respondent, though the Decree now calls it a "war crime", was criminal under Hungarian law. A preliminary point The appellants submitted that to assault a person to the point of death was murder in Hungarian law in 1944. In contrast, the first respondent submitted: "the alleged conduct as described in the Arrest Warrant … does not contain any allegation concerning mens rea, and the [Commonwealth] Director of Public Prosecutions had advised that under Western Australian law it might constitute one of several offences … While it must be accepted that the [first appellant] was entitled to conclude that the alleged conduct was criminal, he did not have a proper basis to be satisfied – if it were relevant – that it constituted the crime of murder." Parties who offer this type of submission tend to prompt in the recipient the reflection: "if they see this as an argument which is necessary for success, they must regard the rest of their case as bad". The submission has two difficulties. First, it is wrong. Secondly, even if it were right it would be immaterial. It is wrong because presuming Hungary succeeds in establishing the facts alleged, the circumstances described in the Arrest Warrant point strongly to murder, whatever mental element was required to establish murder in Hungary in 1944. In particular, the rank of the perpetrators, the way they behaved, the time their conduct took, and the first respondent's alleged conduct after the victim died suggest an intention to cause the victim's death. Further, Hungary advised Australia that it was murder. And even if it were not murder, it would not matter for the purposes of Art 2(5)(a) of the Treaty114. All that matters under Art 2(5)(a) is that it was an offence – not necessarily murder – in Hungary in 1944. If the conduct was not murder, it was an offence. It has doubtless been an offence at least since the time of Árpád. The first respondent's point is an extremely technical one. He appeals to the need to protect liberty. It is true that the protection of liberty often turns on technicality. But is the first respondent's technical point sound? No. Reasoning Some of the arguments the appellants advanced are less convincing than others. It is not necessary to deal with them all. The appeal should be allowed for the following reasons. Was "the offence in relation to which extradition is sought" an offence in Hungary in 1944 within the meaning of Art 2(5)(a)? Hungary describes the offence for which extradition is sought as a "war crime" that falls within the third category outlined above. In the context of Art 2(5)(a), for the reasons given below, the word "offence" refers to the factual criteria necessary to establish criminal guilt. The elements of the offence in relation to which Hungary seeks extradition are assault on a person which is intentional and which causes that person's death. If the first respondent satisfied those criteria, he would have been an instigator of, perpetrator of, or accomplice in the unlawful execution of a person in Hungary. Intentionally assaulting a person and causing that person's death constituted an offence in Hungary in 1944. Even if that offence was not murder, it was still an offence. Therefore "the offence in relation to which extradition is sought" was an offence in Hungary in 1944. The criteria of liability for murder or for any lesser offence corresponded with the criteria of liability for the third category of war crime under the Decree. It is not necessary that the 114 For Art 2 see above at [66]. named offence, "war crime", should have existed in Hungarian law in 1944. It is sufficient that the alleged acts or omissions which Hungary contends amount to the named offence constituted an existing offence in 1944, even if that offence had another name. This construction of the Treaty can be tested as a matter of ordinary English. Assume that the first respondent returns to Hungary. Assume that he is prosecuted for and convicted of the "war crime" alleged. If a questioner later asked him what he was convicted for, an accurate answer would be: "Beating a Jew to death in Budapest in 1944." The questioner could equally accurately answer: "That's murder. That was certainly an offence in Hungary in 1944." The accuracy of these answers is not diminished by the fact that it would have been equally truthful for the first respondent to say that he was convicted of a war crime, and for the questioner to say that there was no offence by that name in Hungary in 1944. The majority of the Full Court of the Federal Court of Australia concluded that the "offence" referred to in Art 2(2) and (5)(a) for which the Requesting State seeks a person's extradition must be "a known, fixed, entity"115. Their Honours concluded that the search which sub-Arts (2) and (5)(a) call for is a search for factual correspondence between the "known, fixed, entity" charged and the criminal law of the Requesting State. The first respondent submitted that the word "offence" denoted "a legal construct rather than a set of acts or omissions." He submitted that it referred to "a particular, identified offence with which a person is to be charged (eg 'murder' or 'war crime')." But Art 2(1) refers to "offences however described", and these cannot be "particular, identified offences". Paragraphs (a) and (b) of Art 2(5) are directed to "determining whether an offence is an offence against the law of" Australia and Hungary. Here, they are directed to determining whether the first respondent's alleged conduct in assaulting a person until he died was an offence against the law of both Australia and Hungary. Article 2(2)(a) provides: "[I]t shall not matter whether the laws of the Contracting States place the acts or omissions constituting the offence within the same category of offence or denominate the offence by the same terminology". That is, it does not matter whether the acts or omissions that Hungary alleges constitute a war crime are placed in the same category as murder under Hungarian law. It does not matter whether the acts or omissions that Hungary alleges constitute a war crime are placed under the category of murder under Australian law. And it does not matter whether Hungary denominates the intentional assault of a person until he dies by the terminology of a war crime or by the terminology of a murder. 115 O'Connor v Zentai (2011) 195 FCR 515 at 569 [153] per Jessup J. Article 2(2)(b) provides that in determining whether the first respondent's alleged conduct in assaulting a person until he died is an offence against the law of both Australia and Hungary: "the totality of the acts or omissions alleged against the person whose extradition is sought shall be taken into account". It also provides: "it shall not matter whether, under the laws of the Contracting States, the constituent elements of the offence differ." Proving some types of war crime under Hungarian law may call for proof of more than must be proved to establish murder. But the totality of the acts or omissions alleged must be taken into account in determining whether the allegation of a "war crime" is an allegation of the crime "murder". It does not matter that the constituent elements of a "war crime" may be greater in number than those of "murder". It does not matter that they may otherwise be different. The language of the Treaty directs attention to "the totality of the acts or omissions alleged". Complying with that direction is inconsistent with concentrating on a "legal construct", a "particular identified offence" or a "known, fixed, entity". Article 2(2)(b) directs that "offence" in Art 2(5) is not used in those latter senses. In fact, in the Arrest Warrant issued against the first respondent the allegation that he committed a "war crime" does not differ from an allegation that he committed a murder. It is possible to draw attention to incongruities and infelicities in Art 2(5). It is also possible to point to problems which would have been solved if its terms were different. And it is possible to contend that the absence of certain language points to a construction adverse to the appellants' position. There is a certain disconformity in the use of the words "offence", conduct "constituting the offence" and "acts or omissions" in Art 2(5). An analyst could seek to draw conclusions adverse to the appellants from that disconformity. That type of reasoning is common in linguistic construction. It can be overdone. It is easy for counsel to conduct a minute and leisurely examination of a document years after it was drafted and ingeniously detect flaws in the drafting if it is read one way. If those flaws could easily have been remedied, it may be contended that it should be read another way. This is a hypercritical approach. It is reminiscent of the approach criminal defence counsel often take to a summing-up when drafting a notice of appeal. So far as that type of reasoning has merit, its merit certainly depends on context. The present context concerns a bilateral treaty entered by Australia and Hungary and negotiated by State representatives who, most probably, did not share fluency in a common language. It is true that the drafting might have been better adapted to achieve the result for which the appellants contend. But that fact does not negate the conclusion that the drafting actually employed achieved that result. As Deane J said in Commonwealth v Tasmania (Tasmanian Dam Case)116: "International agreements are commonly 'not expressed with the precision of formal domestic documents as in English law'." Notice of Contention: failure to give reasons The first respondent contended that even if the appellants' arguments in support of the appeal were accepted, the decision of the Full Court of the Federal Court of Australia should nevertheless be affirmed. He submitted that the first appellant made a jurisdictional error by failing to provide a statement of reasons for his 12 November 2009 decision. That decision determined that the first respondent be extradited to Hungary. It was made under s 22 of the Extradition Act 1988 (Cth) ("the Act"). The first respondent alleged in his Further Amended Grounds of Review that the first appellant's failure to supply reasons made his decision "a nullity and of no legal effect". The first respondent submitted that the first appellant was obligated to give reasons when the decision was made, independently of any request for them. He conceded that there was no common law duty to give reasons117. But he submitted that in the federal sphere a duty to give reasons arises from the limited nature of the Commonwealth Parliament's powers. He submitted that s 22 of the Act should be construed as conditioned by an obligation to give reasons. In the alternative, if s 22 could not be so construed, the first respondent submitted that it was invalid. Section 22 cannot be so construed. Accordingly, the first respondent's alternative submission becomes relevant. The first respondent submitted that the Commonwealth Parliament could not confer an unlimited power on the Executive. The power to make an unreasoned decision is an unlimited power. The power to make a decision without giving reasons is a power to make an unreasoned decision. It is equivalent to the power to give an unexaminable decision, contrary to an implication from s 75(v) of the Constitution. The first respondent also argued that the enforcement of limits on statutory power cannot be achieved unless decision-makers give reasons. Therefore, he contended, the provision of reasons was essential to the validity of the provision conferring the statutory power. These arguments must be rejected. It does not follow from the fact that a decision-maker has not provided reasons that the decision-maker's decision is unreasoned. Nor does it follow that it is unexaminable. The publication of 116 (1983) 158 CLR 1 at 261; [1983] HCA 21, quoting Wynes, Legislative, Executive and Judicial Powers in Australia, 5th ed (1976) at 299. 117 Public Service Board of New South Wales v Osmond (1986) 159 CLR 656; [1986] HCA 7. reasons certainly helps those who wish to challenge administrative decisions. But it is not essential to a challenge. A decision-maker can be compelled to produce documents revealing the reasons for a given decision, whether by a subpoena duces tecum or a notice to produce. That decision-maker can be compelled by interrogatories to reveal those reasons in writing, and by a subpoena ad testificandum to reveal those reasons in the witness box. It is true that judicial review proceedings cannot be commenced on an entirely speculative basis. But non-speculative inferences can be drawn from the nature of the decision and from the dealings between the decision-maker and the affected person before the decision was made. It is also true that it would be difficult for a person challenging the decision to frame non-leading questions capable of eliciting answers that would reveal the decision-maker's reasons. But the person challenging the decision can question the decision-maker as though on cross- examination where the decision-maker is not making a genuine attempt to give evidence on a matter of which that decision-maker may reasonably be supposed to have knowledge: Evidence Act 1995 (Cth), s 38(1)(b). Reluctance on the decision-maker's part to give reasons would support an inference that there were no reasons, or no convincing reasons. It would be likely to stimulate close curial scrutiny. That is particularly so of adherence to a code of omerta in the witness Further, it is not possible to derive from s 75(v) of the Constitution an implication that all decision-making powers subject to s 75(v) review must be construed as carrying with them a duty to provide reasons. Section 75(v) is extremely important. But it is a grant of jurisdiction. It is not a source of substantive law governing the conduct of Commonwealth officers in relation to their reasoning processes. Another difficulty for the first respondent is that the Administrative Decisions (Judicial Review) Act 1977 (Cth), which in s 13 creates a duty in some cases to give reasons, assumes that his argument is flawed. As the first respondent conceded, s 13 of that Act is predicated on the fact that there is no underlying obligation to give reasons. The first respondent endeavoured to meet that difficulty by submitting that his argument was novel, but that novelty was no bar to success. However, his argument cannot overcome the fact that Sched 1 par (r) of that Act specifically relieves the first appellant from the s 13 duty to give reasons. The first respondent's argument can scarcely stand with that express provision about the specific topic at hand. The in Cunliffe v The Commonwealth119. Those passages do not support the first respondent's relied on passages respondent first 118 Wainohu v New South Wales (2011) 243 CLR 181 at 239 [149]; [2011] HCA 24. 119 (1994) 182 CLR 272 at 303 and 331; [1994] HCA 44. argument. They record the difficulties of challenging administrative decisions if reasons are not provided. They lament the consequential inadequacy to that extent of curial control over the exercise of administrative powers. But they do not state that a decision for which reasons are not provided is void. For those reasons the contention the first respondent advanced must be rejected. Orders The appeal should be allowed. By reason of their undertaking recorded in the argument on the special leave application, the appellants should pay the first respondent's costs of the appeal. The appellants seek their costs of the Notice of Contention, however. No argument was advanced against that application. The appellants are entitled to those costs. Consequential orders should be made, including the dismissal of the Further Amended Application.

HIGH COURT OF AUSTRALIA APPELLANT AND THE QUEEN RESPONDENT [2022] HCA 31 Date of Hearing: 16 June 2022 Date of Judgment: 7 September 2022 ORDER Appeal allowed. Set aside order 1 of the orders of the Court of Criminal Appeal of New South Wales and, in its place, order that: the appeal against conviction on counts 6, 7, and 13 be allowed; and the verdicts of guilty on counts 6, 7, and 13 be quashed and acquittals be entered on those counts. Set aside order 3 of the orders of the Court of Criminal Appeal of New South Wales and, in its place, order that the sentence imposed on 13 November 2019 be set aside. Remit the matter to the Court of Criminal Appeal of New South Wales for re-sentencing on counts 1, 2, and 3 only. On appeal from the Supreme Court of New South Wales Representation O P Holdenson QC with J P O'Connor for the appellant (instructed by Macedone Legal) D T Kell SC with M W R Adams for the respondent (instructed by Office of the Director of Public Prosecutions (NSW)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Criminal law – Sexual offences against child – Presumption against retrospective operation – Where appellant pleaded not guilty on 29 November 2018 to sexual offences against complainant – Where Crown was uncertain whether alleged conduct occurred when s 81 of Crimes Act 1900 (NSW) in force, or when s 81 repealed but s 78K in force – Where s 80AF of Crimes Act came into force on 1 December 2018, allowing prosecution to rely, in relation to entirety of period, on whichever offence carried lesser maximum penalty – Where Crown was granted leave after appellant's trial had commenced to amend indictment to take benefit of s 80AF – Whether s 80AF could apply after an accused's trial had commenced. Words and phrases – "arraignment", "change in the law", "commencement of a trial", "historic sexual offences", "indictment", "presumption against retrospective operation", "reasonable expectations", "retroactive", "retrospective", "sexual offence", "textual indications". Crimes Act 1900 (NSW), ss 78K, 80AF, 81. Criminal Procedure Act 1986 (NSW), ss 20, 130. Interpretation Act 1987 (NSW), ss 5, 30. KEANE, GORDON, EDELMAN AND GLEESON JJ. Introduction The appellant, Mr Stephens, was convicted in the District Court of New South Wales of seven of 14 counts charged on an amended indictment concerning sexual abuse of a child. Mr Stephens appealed to the Court of Criminal Appeal of New South Wales from his convictions on four of those seven counts. The Court of Criminal Appeal set aside his conviction on one of those counts1. Mr Stephens appeals to this Court in relation to the dismissal of his appeal on the other three counts. The issue on this appeal concerns the scope of operation of s 80AF of the Crimes Act 1900 (NSW), a provision intended to facilitate the prosecution of historic sexual offences in cases of uncertainty about when the relevant offence was committed. Specifically, the question is whether s 80AF, without any clear words or any expression of intention to do so, goes so far as to have the remarkable effect, in its field of application, of expanding the scope of the accused's potential criminal liability after their trial has commenced following the first arraignment by extinguishing the force of legal authorities in support of a path of acquittal. For the reasons below, the legislation does not have that effect. The appeal must be allowed. The trial, the change in the law during the trial, and the convictions On 29 November 2018, Mr Stephens was arraigned before a judge in the District Court on an 18-count indictment. The indictment alleged offences by Mr Stephens against a complainant from the time that the complainant was ten years old until the complainant was approximately 15 years old. The indictment charged Mr Stephens with eight counts of conduct contrary to s 81 of the Crimes Act, and ten counts of conduct contrary to s 78K of the Crimes Act. Section 81 of the Crimes Act was in force from the time of the enactment of the Crimes Act in 1900 until 8 June 19842. It relevantly provided that it was an offence to commit "an indecent assault upon a male person of whatever age, with Stephens v The Queen (2021) 290 A Crim R 303. 2 Crimes (Amendment) Act 1984 (NSW), s 3, Sch 1, item 8, repealing s 81; New South Wales Government Gazette, No 90, 8 June 1984. or without the consent of such person". The maximum penalty was five years' imprisonment. Section 78K of the Crimes Act was in force from 8 June 19843 until 13 June 20034. It relevantly provided that an offence is committed by a "male person who has homosexual intercourse with a male person of or above the age of 10 years, and under the age of 18 years". The maximum penalty was ten years' imprisonment. In respect of four instances of alleged conduct, the Crown was uncertain whether the alleged conduct by Mr Stephens occurred either (i) before 8 June 1984, when s 81 was in force, or (ii) on or after 8 June 1984, when s 81 had been repealed but s 78K was in force. As Simpson A-JA explained in the Court of Criminal Appeal, these four instances were formulated in pairs of alternative counts under ss 81 and 78K (namely counts 5 and 6, counts 7 and 8, counts 9 and 10, and counts 11 and 12) "to provide the best possible chance of bringing the conduct (if proved) within one of the offence-creating provisions". But her Honour also observed5: "The strategy was not foolproof; if the evidence given at trial failed ... to bring the conduct on one side of the cut off date or the other, the Crown would fail to prove either offence." On his arraignment on 29 November 2018, Mr Stephens pleaded not guilty to each count on the indictment. Although the question of when a trial begins may have a different answer for different purposes6, in this context the Court of Criminal Appeal held7, and in this Court there was no dispute, that the arraignment on 29 November 2018 relevantly marked the commencement of Mr Stephens' trial. 3 Crimes (Amendment) Act 1984 (NSW), s 3, Sch 1, item 4, introducing s 78K; New South Wales Government Gazette, No 90, 8 June 1984. 4 Repealed by Crimes Amendment (Sexual Offences) Act 2003 (NSW), s 3, Sch 1 [18]; New South Wales Government Gazette, No 97, 13 June 2003. Stephens v The Queen (2021) 290 A Crim R 303 at 310 [26], referring to R v Page (unreported, New South Wales Court of Criminal Appeal, 25 November 1991). 6 R v Gilham (2007) 73 NSWLR 308 at 325 [78]. Stephens v The Queen (2021) 290 A Crim R 303 at 315 [48], 320 [88]. Section 130 of the Criminal Procedure Act 1986 (NSW), introduced in 19978, relevantly provides in s 130(2) that the court has jurisdiction with respect to the conduct of proceedings on indictment as soon as the indictment is presented and the accused person is arraigned and, in s 130(3), that if (as here) proceedings are held for the purposes of making orders after the indictment is presented and before the jury is empanelled, those proceedings are part of the trial and "the accused person is to be arraigned again on the indictment when the jury is empanelled for the continuation of the trial" (emphasis added). As Howie J said in R v Janceski9, an arraignment before the jury panel is not a necessary step to commence the trial; rather, when the accused is first arraigned and pleads "not guilty" they are "taken to have put [themself] on the country for trial". That is, "answering to the indictment on arraignment has that effect, whether the arraignment takes place before the jury panel or not"10. Thereafter, the court has jurisdiction to make orders with respect to the conduct of the proceedings under s 130 of the Criminal Procedure Act. On 1 December 2018, s 80AF of the Crimes Act came into force11. As explained below, one practical effect of s 80AF was to enlarge the period during which s 81 was in force for indecent assaults that also involved an offence under s 78K. That period was enlarged from one that ended on 8 June 1984 to one that ended on 13 June 2003. By enlarging this period, s 80AF removed what was, at least, uncertainty concerning whether Mr Stephens could be convicted of an offence under s 81 or s 78K if the Crown could not prove beyond reasonable doubt either (i) that the alleged conduct occurred during the period in which s 81 was in force, or (ii) that the alleged conduct occurred during the period in which s 78K was in force. On 5 February 2019, the Crown was granted leave to amend the indictment under s 20(1) of the Criminal Procedure Act in order to take the benefit of s 80AF. The Crown substituted an indictment with the following features relevant to the three counts that are the subject of this appeal (counts 6, 7, and 13). Count 6 8 Crimes Legislation Amendment (Procedure) Act 1997 (NSW), Sch 2, item 2, introducing s 19. Compare R v Nicolaidis (1994) 33 NSWLR 364 at 367. (2005) 64 NSWLR 10 at 42 [219]. See Criminal Procedure Act 1986 (NSW), s 154. 10 Amagwula v The Queen [2019] NSWCCA 156 at [30]. 11 Criminal Legislation Amendment (Child Sexual Abuse) Act 2018 (NSW), Sch 1 [46]; New South Wales, Commencement Proclamation, 2018 No 671, 28 November replaced the alternative counts 7 and 8 on the original indictment. Count 7 replaced the alternative counts 9 and 10 on the original indictment. The new counts 6 and 7 relied only upon s 81, and the extended time period for s 81 as a consequence of the new s 80AF. Count 13 replaced, without substantive amendment, count 17 of the original indictment. There were further amendments to the indictment during the course of the trial. On 11 February 2019, after the jury had been empanelled, the Court granted leave for the Crown to amend the date range for the offending conduct to commence a year earlier in respect of count 14. On 19 February 2019, after the close of the Crown case, the trial judge granted leave to the Crown to amend counts 8, 11, 13, and 14 on the indictment to conform with the evidence that had been given during the trial and for the Crown to rely upon s 80AF. The charged offence in count 13 of conduct contrary to s 78K between 6 July 1985 and 6 July 1986 (when s 78K was in force) was replaced with a charge of an act of indecency contrary to s 81 between 6 July 1983 and 6 July 1986 (which included periods when each of ss 81 and 78K was in force). Mr Stephens was convicted on counts 1, 2, 3, 6, 7, 13, and 14. He was sentenced to an aggregate term of imprisonment of seven years and nine months with a non-parole period of four years and nine months. He appealed to the Court of Criminal Appeal from his convictions on counts 6, 7, 13, and 14. The Court of Criminal Appeal quashed his conviction on count 14 only and re-sentenced Mr Stephens to an aggregate term of imprisonment of six years with a non-parole period of three years and nine months. Mr Stephens, by grant of special leave, appeals to this Court in relation to his convictions on counts 6, 7, and 13. Section 80AF of the Crimes Act Section 80AF was a direct justice recommendations of the Royal Commission into Institutional Responses to Child Sexual Abuse and a Departmental Review conducted on the recommendation of a Joint Select Committee of the New South Wales Parliament12. The Departmental Review made reference to the very difficulty that arises on this appeal, saying13: the criminal response 12 New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 6 June 13 New South Wales, Department of Justice, Child Sexual Offences Review Discussion Paper (2017) at 30 [6.9]. "When looking at historic offences, the date range can coincide with a change of legislation and the same elements may constitute different offences. For example, fellatio was previously considered to be an indecent act but since legislative change in 1991 it is now considered to be sexual intercourse. There are no legislative provisions as to how the prosecution should proceed in these matters." The Departmental Review observed that "[c]ase law provides some guidance on this issue, however, it has not been satisfactorily resolved", and, after referring to the decision of this Court in Gilson v The Queen14, proposed an option "A legislative provision could be introduced to allow the prosecution to rely on the offence with the lowest maximum penalty where there is uncertainty about the age of the victim at the time of the offence and the date range falls into more than one offence. This would be consistent with the decision of In Gilson, the police found stolen property in the applicant's flat. The applicant was charged with alternative counts of (i) shopbreaking and larceny, and (ii) receiving goods stolen from the shop. The jury convicted the applicant of the count of receiving stolen goods. Although ultimately dismissing an appeal and upholding the applicant's conviction, four members of this Court said in a joint judgment that the trial judge should have directed the jury that if they were satisfied beyond reasonable doubt that the accused either stole the property or received it knowingly, but were unsure which, then they should return a verdict of guilty of the less serious offence. Although the seriousness of an offence will prima facie reflect the maximum penalty attached to it, the circumstances of the particular case might mean that the less serious offence carries the greater maximum penalty, and so the trial judge should have directed the jury as to which of the offences was the less serious16. As can be seen, the option proposed by the Departmental Review was in fact different from the approach in Gilson: the former provided for an accused to be found guilty of the offence carrying the lowest maximum penalty, rather than (1991) 172 CLR 353. 15 New South Wales, Department of Justice, Child Sexual Offences Review Discussion Paper (2017) at 30-31 [6.10]-[6.12]. (1991) 172 CLR 353 at 364. the less serious offence, which the joint judgment in Gilson recognised might be different17. In the second reading speech of the legislation which introduced s 80AF, the Attorney-General for New South Wales said the provision was a procedural reform to "facilitate prosecutions for child sexual offences". It was said to address "complexities that currently arise for the prosecution" where the applicable offence changes during the period of offending, including because the child's age has changed during that period or the relevant law has been amended. The Attorney-General added that s 80AF "will ensure that the prosecution can rely on whichever offence carries the lesser maximum penalty, and can rely on this offence in relation to the entirety of the period"18. As noted above, s 80AF of the Crimes Act came into force on 1 December 2018, after Mr Stephens had entered his pleas and, therefore, after his trial had formally commenced. At that time, the section provided: "80AF Uncertainty about time when sexual offence against child occurred This section applies if: it is uncertain as to when during a period conduct is alleged to have occurred, and the victim of the alleged conduct was for the whole of that period a child, and there was no time during that period that the alleged conduct, if proven, would not have constituted a sexual offence, and because of a change in the law or a change in the age of the child during that period, the alleged conduct, if proven, would have constituted more than one sexual offence during that period. In such a case, a person may be prosecuted in respect of the conduct under whichever of those sexual offences has the lesser maximum (1991) 172 CLR 353 at 364. 18 New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 6 June penalty regardless of when during that period the conduct actually occurred, and in prosecuting that offence: any requirement to establish that the offence charged was in force is satisfied if the prosecution can establish that the offence was in force at some time during that period, and any requirement to establish that the victim was of a particular age is satisfied if the prosecution can establish that the victim was of that age at some time during that period. In this section: child means a person who is under the age of 16 years. sexual offence means the following offences regardless of when the offence occurred: an offence under a provision of this Division or Division 10A, 10B, 15 or 15A, an offence under a provision of this Act set out in Column 1 of Schedule 1A, an offence (whether under section 344A or otherwise) of attempting to commit any offence referred to in paragraph (a) or (b), an offence under a previous enactment that is substantially similar to an offence referred to in paragraphs (a)-(c)." The effect of the insertion of s 80AF Section 80AF had the effect of displacing the significant body of authority the effect of which was, in the circumstances of this case, that the Crown was required, on each count under s 81 or s 78K, to prove beyond reasonable doubt that the alleged conduct was committed at a time when the relevant section was in force19. If the Crown could not prove beyond reasonable doubt that the alleged 19 R v Page (unreported, New South Wales Court of Criminal Appeal, 25 November 1991); Question of Law Reserved (No 2 of 1996) (1996) 67 SASR 63 at 79; Kailis v The Queen (1999) 21 WAR 100 at 114 [41], 147 [175]; Greenaway (2000) 118 conduct occurred during the relevant time period, then Mr Stephens was entitled to be acquitted of the counts concerning that alleged conduct. It is at least arguable that this body of authority is inconsistent with Gilson, but it is neither necessary nor appropriate to determine the point as it was not the subject of argument and, on any view, s 80AF gives rise to the possibility that a jury might convict an accused person of a more serious offence than the decision of this Court in Gilson had permitted. It was on that state of the law that Mr Stephens pleaded not guilty to the counts which, as eventually consolidated and amended, became counts 6, 7, and 13. And it was on that state of the law that forensic decisions were made during the course of Mr Stephens' trial in relation to count 13. Upon the commencement of s 80AF, the law changed for accused persons in a position similar to that of Mr Stephens. For those persons, the change in the law was not merely a matter of the evidence that was required to be led. The immediate effect of s 80AF was to extend the period that s 81 was in force, for conduct that constituted an offence under both ss 81 and 78K, from 8 June 1984 until 13 June 2003. The possibility of a path to acquittal based upon uncertainty concerning the period of offending was thereby removed. The decision of the Court of Criminal Appeal A majority of the Court of Criminal Appeal (Simpson A-JA with Davies J agreeing) held that s 80AF applied retroactively including to trials that had already commenced. In the first strand of her Honour's reasoning, Simpson A-JA considered that the reasoning of this Court in Rodway v The Queen20 was "directly apposite" to the appeal before the Court21. In a further strand of reasoning, her Honour held that s 80AF did not alter a pre-existing criminal offence, but instead did "no more than facilitate the proof of criminal conduct as an offence"22. A Crim R 299 at 300 [5]-[7], [9]; R v D, WD (2013) 116 SASR 99 at 109 [37]; SI v Western Australia [No 2] [2014] WASCA 44. cf R v MAJW (2007) 171 A Crim R 407 at 413 [27]; MJ v The Queen [2013] NSWCCA 250 at [46]-[55]. (1990) 169 CLR 515. 21 Stephens v The Queen (2021) 290 A Crim R 303 at 313 [41]. 22 Stephens v The Queen (2021) 290 A Crim R 303 at 316 [58]. With great respect, and despite the cogency of other aspects of her Honour's reasons (including that Mr Stephens' trial had commenced before s 80AF came into force), neither of these strands of reasoning is correct. legislation As to the first strand of Simpson A-JA's reasoning, this Court in Rodway held that the Tasmanian Parliament had intended what was described as the that abolished a requirement of "retrospective operation" of corroboration of a complainant's evidence for the proof of certain sexual offences. Importantly for this appeal, in Rodway the appellant's trial commenced after the Tasmanian legislation had taken effect. And the Tasmanian legislation did not countenance the possibility of the legal or evidential rules changing during the course of the trial. The only question in that case was whether the Tasmanian legislation was purely prospective in its operation. Thus, there was no issue in Rodway concerning whether the abolition of the requirement of corroboration applied to trials that were extant such that the requirement could change during the course of a trial. As to the second strand of Simpson A-JA's reasoning, for the reasons in the section above, s 80AF, in its retroactive operation, did alter the law as to pre-existing offences. Button J dissented, and would have quashed Mr Stephens' convictions on counts 6, 7, and 13. His Honour rightly held that the legislation had retroactive effect, but said that although social and political context might suggest that Parliament intended that the legislation apply to proceedings that had already commenced, there was no transitional provision to cover such proceedings, nor was there any extrinsic material setting out such an intention23. After observing that the effect of the legislation is that some accused persons who would previously have been acquitted will now be convicted, his Honour said24: "I am not satisfied that Parliament necessarily intended that the legislation is to apply to the relatively small subset of criminal proceedings for child sexual assault that had already commenced and that would feature the specific chronological problem of proof to which the legislation is addressed." (emphasis in original) His Honour's conclusion was correct. 23 Stephens v The Queen (2021) 290 A Crim R 303 at 320 [91]-[93]. 24 Stephens v The Queen (2021) 290 A Crim R 303 at 321 [95], [99]. Expectations and the temporal operation of legislative provisions There is considerable confusion surrounding the nomenclature of retrospective and retroactive legislative provisions. On one view, they are separate concepts. A retrospective provision "operates for the future only" albeit that it looks backwards and "imposes new results in respect of a past event". Thus, for the future only, it "changes the law from what it otherwise would be with respect to a prior event". By contrast, a retroactive provision operates backwards and has been described as one that "changes the law from what it was"25. On another view, there is only one category. All these laws can loosely be described as retrospective, although retroactive laws are the only "true" retrospective laws26. Laws that operate for the future only, but impose new results in respect of past events, have been said to be retrospective in an "extended" sense27, although that sense has sometimes been described as "misleading"28. These debates are not concerned with matters of principle. The distinctions between retrospective and retroactive laws are "terminological, not conceptual"29. However described, both are capable of defeating reasonable expectations concerning existing rights, although retroactive laws will generally be more pronounced in this effect. These distinctions should not distract from the underlying principle described below, concerning how to interpret the temporal operation of legislation. 25 Benner v Canada (Secretary of State) [1997] 1 SCR 358 at 381 [39], quoting Driedger, "Statutes: Retroactive Retrospective Reflections" (1978) 56 Canadian Bar Review 264 at 268-269; Canada (Attorney General) v Hislop [2007] 1 SCR 429 at 482 [127]. See also Juratowitch, Retroactivity and the Common Law (2008) at 6. 26 R v Kidman (1915) 20 CLR 425 at 443. See also Polyukhovich v The Commonwealth (1991) 172 CLR 501 at 642. 27 Maxwell v Murphy (1957) 96 CLR 261 at 285; Australian Education Union v General Manager of Fair Work Australia (2012) 246 CLR 117 at 133 [26]. 28 Chang Jeeng v Nuffield (Australia) Pty Ltd (1959) 101 CLR 629 at 637; Australian Education Union v General Manager of Fair Work Australia (2012) 246 CLR 117 29 Juratowitch, Retroactivity and the Common Law (2008) at 7. Another distinction is sometimes drawn between substantive and procedural provisions30. In Rodway, this Court referred to the presumption "that a statute ought not be given a retrospective operation where to do so would affect an existing right or obligation unless the language of the statute expressly or by necessary implication requires such construction". This Court explained that "there is no presumption against retrospectivity in the case of statutes which affect mere matters of procedure" as such statutes "invariably operate prospectively"31. This Court in Rodway recognised, however, that there was an ambiguity in the categorisation of some laws as procedural, saying that "the difference between substantive law and procedure is often difficult to draw and statutes which are commonly classified as procedural ... may operate in such a way as to affect existing rights or obligations" and, as such, would not be "merely" procedural32. But even this distinction, which requires a difference between procedural laws and "merely procedural" laws, is not a stable basis for deciding whether to apply a presumption against retroactivity. The point of principle underlying the distinction is that laws which might be said to be procedural can have such a significant effect in disturbing settled expectations that the presumption will apply, denying an otherwise clear retroactive effect in relation to an extant trial. An example is the law considered by this Court in Newell v The King33 that amended the procedure of conviction by a unanimous jury to permit conviction by a majority of ten jurors. The principle "that a statute is not presumed to be retrospective" was applied because the law was "not a mere matter of procedure"34. The words of the legislation that said "on the trial of any criminal issue" were interpreted to mean "on the trial of any criminal issue joined after the commencement of the Act"35. The importance of not permitting an artificial distinction between substance and procedure to control the underlying principle was further emphasised in Maxwell v Murphy by Dixon CJ, who said that "difficulties have always attended 30 Wright v Hale (1860) 6 H & N 227 at 231-232 [158 ER 94 at 95]; Maxwell v Murphy (1957) 96 CLR 261 at 267-268, 285-286; Yrttiaho v Public Curator (Queensland) (1971) 125 CLR 228 at 245-246. (1990) 169 CLR 515 at 518. (1990) 169 CLR 515 at 518. (1936) 55 CLR 707. (1936) 55 CLR 707 at 711. (1936) 55 CLR 707 at 712. its application"36, and by Fullagar J, who described the distinction as one that "does not represent a logical dichotomy"37. In another context, it has been said of the distinction that "search as one may, it is very hard, if not impossible, to identify some unifying principle which would assist in making the distinction in a particular case"38. Like the distinction between retrospective laws and retroactive laws, the distinction between substance and procedure can also distract from the underlying principle. Shorn of difficult-to-draw distinctions and difficult-to-apply nomenclature, the underlying principle concerning how to interpret the temporal operation of legislation is based on reasonable expectations. As H L A Hart explained, "the reason for regarding retrospective law-making as unjust is that it disappoints the justified expectations of those who, in acting, have relied on the assumption that the legal consequences of their acts will be determined by the known state of the law established at the time of their acts"39. The reasonable expectations of the public give rise to a presumption against interpreting the enactments of Parliament in a manner "that would conflict with recognized principles that Parliament would be prima facie expected to respect"40. In this context, what is a "reasonable expectation" will necessarily be informed by fundamental principles of criminal law, the accusatorial process, and the law in force at the relevant time. The force of this presumption may depend upon the circumstances: "[t]he inhibition of the rule is a matter of degree, and must vary secundum materiam [according to the circumstances]"41. The more fundamental the rights, and the greater the extent to which they would be infringed by a retrospective or retroactive (1957) 96 CLR 261 at 267. (1957) 96 CLR 261 at 286. 38 John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 542-543 [97]. See also at 39 Hart, The Concept of Law, 3rd ed (2012) at 276. 40 Ex parte Walsh and Johnson; In re Yates (1925) 37 CLR 36 at 93. 41 Doro v Victorian Railways Commissioners [1960] VR 84 at 86, quoting Barber v Pigden [1937] 1 KB 664 at 678. law, the less likely it is that such an intention will be ascribed to Parliament42. Conversely, the less a provision would defeat reasonable expectations, and the less injustice it would cause, the less force there will be in the presumption against retrospective operation. Thus, the force of the presumption is reduced where the "wrongful nature of the conduct ought to have been apparent to those who engaged in it"43. And the presumption will often have little or no force in relation to future trials where the law affects rights and interests only slightly and indirectly, such as by the common iterative process of adjusting legal rules of evidence or procedure in the conduct of trials44. The presumption against retroactive operation of a statute does not apply in an all-or-nothing manner. A statute is not to be construed as retroactive "to any greater extent than the clearly expressed intention of the Legislature indicates"45. An example of this is the decision of the Court of Criminal Appeal of New South Wales in Lodhi v The Queen46. The question in that case was whether the primary judge should have quashed counts on an indictment that alleged terrorist offences under ss 101.4, 101.5, and 101.6 of the Criminal Code (Cth), as amended by the Anti-Terrorism Act 2005 (Cth). Section 106.3 was subsequently introduced by the Anti-Terrorism Act (No 2) 2005 (Cth), and relevantly provided that the amendments applied to "offences committed ... before the commencement of Section 106.3 was plainly intended to have retroactive operation. But the issue was whether it applied to the applicant, since the amendments came into force after the applicant had pleaded to the charges against him, and hence after his trial had commenced. Spigelman CJ (with whom McClellan CJ at CL and Sully J 42 Australian Education Union v General Manager of Fair Work Australia (2012) 246 CLR 117 at 135 [32], quoting Attorney-General (NSW) v World Best Holdings Ltd (2005) 63 NSWLR 557 at 572 [59]. See also Mann v Paterson Constructions Pty Ltd (2019) 267 CLR 560 at 623 [159]. 43 Polyukhovich v The Commonwealth (1991) 172 CLR 501 at 643. 44 Rodway v The Queen (1990) 169 CLR 515 at 521. Compare Newell v The King (1936) 55 CLR 707. 45 R S Howard & Sons Ltd v Brunton (1916) 21 CLR 366 at 371. See also Australian Education Union v General Manager of Fair Work Australia (2012) 246 CLR 117 (2006) 199 FLR 303. agreed) held that despite the words of s 106.3 the provision nevertheless did not extend to those offences committed before the commencement of s 106.3 "on which criminal issue was joined before the commencement of the section" on the "Parliament is 'prima facie expected to respect' the principle that a statute will not retrospectively alter a criminal offence where a trial has commenced". Section 80AF has limited retroactive effect Section 80AF is plainly intended to operate retroactively to some extent. It was enacted to respond to difficulties in prosecuting historic sex offences. The very definition of "sexual offence" in s 80AF(3) extends to a list of offences "regardless of when the offence occurred" including offences "under a previous enactment". But to construe s 80AF as being completely retroactive would significantly disturb reasonable expectations about the manner in which the law is implemented. It would not merely mean that the law concerning s 81 of the Crimes Act was altered retroactively for future trials. It would have the effect of changing that law for extant proceedings, including those that commenced before s 80AF came into force such as Mr Stephens' trial, where forensic decisions including a plea of guilty or not guilty or the scope of cross-examination of witnesses may have been made in reliance upon the previous law. And it would do so without any indication in the text, context, or purpose of s 80AF that this was intended. Indeed, it would do so in the teeth of textual indications to the contrary. In Zainal bin Hashim v Government of Malaysia48, the Privy Council said that "for pending actions to be affected by retrospective legislation, the language of the enactment must be such that no other conclusion is possible than that that was the intention of the legislature". Such an expression may have been overstated by suggesting a requirement that all other conclusions be impossible, but it is certainly correct to say that "[s]ince the potential injustice of interfering with the rights of parties to actual proceedings is particularly obvious, this ... presumption (2006) 199 FLR 303 at 314 [49]-[50]. [1980] AC 734 at 742. [against retrospective or retroactive operation] will be that much harder to displace"49. The injustice of displacing the consequences of forensic decisions made in extant proceedings is not ameliorated, contrary to the submission of the Crown on this appeal, by the possibility that the Crown might be denied leave to amend the indictment under s 20(1) of the Criminal Procedure Act. If Parliament's intention were really that s 80AF should have retroactive application to criminal trials that are already in progress, then it is hard to see on what basis leave could be refused if the only prejudice to an accused person were that very retroactive application that Parliament intended. The injustice of this interpretation in its defeat of reasonable expectations would go even further. There is no reason to doubt that it would change the law even with respect to concluded proceedings that are the subject of an appeal by removing the right to have a conviction set aside in some circumstances. In Australian Education Union v General Manager of Fair Work Australia50, French CJ, Crennan and Kiefel JJ referred to the observation of the Privy Council that explicit language was required to justify an interpretation that "a legislative body intended not merely to alter the law, but to alter it so as to deprive a litigant of a judgment rightly given and still subsisting". This reasoning applies equally where the legislation would deprive a convicted person of the right to have their conviction set aside. This consequence could arise where, prior to the commencement of s 80AF, a jury was satisfied beyond reasonable doubt of conduct that constituted two offences that applied during different periods, but was uncertain about the time of the conduct and therefore uncertain about which offence had been committed. If the trial judge, intending to give a direction that extended the decision of this Court in Gilson, had erroneously directed the jury that in those circumstances they could convict the accused of the offence with the lesser maximum penalty rather than the less serious offence, a fully retroactive application of s 80AF would mean that such a clear error could not be corrected on appeal. The retroactive operation of s 80AF would deem the offender to have committed the more serious offence. Without denying the extreme consequences of this interpretation, on this appeal the Crown submitted that s 80AF should nevertheless be given full 49 Attorney-General (NSW) v World Best Holdings Ltd (2005) 63 NSWLR 557 at 573 [59], quoting Wilson v First County Trust Ltd [No 2] [2004] 1 AC 816 at 881 [198]. (2012) 246 CLR 117 at 136 [33], quoting Lemm v Mitchell [1912] AC 400 at 406. retroactive effect because issues such as the date range of alleged offending are concerned only with procedure or "proof" of an offence, rather than the elements of the offence itself. For the reasons already explained, that characterisation is incorrect. Section 80AF changed the law concerning the elements of the offence itself. In any event, such arguments about the characterisation of a law as one of "proof" of an offence rather than one concerning the "elements" of the offence involve preferring the artificial distinction between procedure and substance over the underlying principle. For the reasons expressed above, the distinction should not control the underlying principle. Indeed, such an artificial distinction is eschewed in s 30 of the Interpretation Act 1987 (NSW). That provision spans matters of proof or procedure and matters of legal right or substance. It instantiates the presumption against retrospective operation so that, subject to contrary intention51, the amendment or repeal of an Act does not affect a variety of reasonable expectations, including "the proof of any past act or thing"52 as well as "any right, privilege, obligation or liability saved by the operation of the Act"53. On its proper interpretation, s 80AF does not operate with respect to trials that had already commenced when the section came into force. Moreover, on its terms, s 80AF may be invoked only at the commencement of a trial, not after the trial has already commenced. Two considerations support this conclusion. First, s 80AF(2) states that a person "may be prosecuted". That phrase is apt to refer to the commencement, not the continuation, of the criminal proceedings in which an accused is tried54. Secondly, ss 80AF(1)(a) and 80AF(2) apply so that "a person may be prosecuted" where, amongst other things, it is "uncertain as to when during a period conduct is alleged to have occurred". That uncertainty appears textually expressed as uncertainty prior to the commencement of the prosecution, rather than an ambulatory concern with uncertainties that arise during trial so that Interpretation Act 1987 (NSW), s 5(2). Interpretation Act 1987 (NSW), s 30(2)(a). Interpretation Act 1987 (NSW), s 30(2)(b). 54 PT Garuda Indonesia Ltd v Australian Competition and Consumer Commission (2012) 247 CLR 240 at 250 [29], citing Shepherd v Griffiths (1985) 7 FCR 44 at an accused person can continue to be prosecuted. It suggests a reference to uncertainty of the Crown prior to the commencement of the prosecution. It is likely that there will be some such uncertainty in a great many historic sex offence prosecutions and it may be that a prosecution in reliance upon s 80AF will become an almost invariable approach in such cases. But an interpretation of s 80AF which restricts its retroactive effect, by requiring that the Crown elect to take advantage of a provision making a change in the law before the trial commences, is supported by textual indications as well as reasonable expectations of such operation. Indeed, those reasonable expectations must be part of the expressed concern for "fairness" to which reference is made in the Departmental Review which was part of the context of the enactment of s 80AF55. Conclusion Orders should be made as follows: Appeal allowed. Set aside order 1 of the orders of the Court of Criminal Appeal of New South Wales and, in its place, order that: the appeal against conviction on counts 6, 7, and 13 be allowed; and the verdicts of guilty on counts 6, 7, and 13 be quashed and acquittals be entered on those counts. Set aside order 3 of the orders of the Court of Criminal Appeal of New South Wales and, in its place, order that the sentence imposed on 13 November 2019 be set aside. Remit the matter to the Court of Criminal Appeal of New South Wales for re-sentencing on counts 1, 2, and 3 only. 55 New South Wales, Department of Justice, Child Sexual Offences Review Discussion Paper (2017) at 30 [6.10]. STEWARD J. I respectfully agree with the majority that the test for ascertaining whether a provision has retrospective or retroactive effect turns upon whether Parliament intended to disappoint and interfere with the "reasonable expectations" of those who assumed that the legal consequences of their actions would be determined in accordance with the law in force at the time of their actions56. I also respectfully agree that much will turn upon the degree to which rights that are fundamental have been altered, and the extent of the period of retrospectivity57. These principles assist in determining whether a law that operates retrospectively should apply to pending criminal or civil proceedings. However, after some hesitation, I do not, in the unique circumstances of this case, consider that Mr Stephens' "reasonable expectations about the manner in which the law is implemented"58 were significantly disturbed by the application of s 80AF of the Crimes Act 1900 (NSW) to his trial. There are four considerations that are relevant to this conclusion. First, the other members of this Court say that s 80AF does not operate with respect to pending criminal proceedings that had already commenced before the section came into force59. In this case, Mr Stephens was first arraigned on 29 November 2018. Accordingly, their Honours reason that his trial had already commenced when s 80AF came into force on 1 December 2018. Even assuming the correctness of this construction of s 80AF (as to which see below), this characterisation of what happened is, with very great respect, incorrect. Under New South Wales law, the trial of Mr Stephens did not commence on 29 November 2018; rather it commenced on 7 February 2019, when Mr Stephens was arraigned on an amended 14-count indictment and pleaded not guilty to each count in the presence of the jury. Section 80AF came into force before that time. In this respect, s 130 of the Criminal Procedure Act 1986 (NSW) ("the Procedure Act") is important. That section relevantly provides as follows: In this section, court means the Supreme Court or District Court. The court has jurisdiction with respect to the conduct of proceedings on indictment as soon as the indictment is presented and the accused person is arraigned, and any orders that may be made by the court 56 See [33]; Hart, The Concept of Law, 3rd ed (2012) at 276. 57 See [34]. 58 See [38]. 59 See [45]. Steward for the purposes of the trial in the absence of a jury may be made before a jury is empanelled for the trial. If proceedings are held for the purpose of making any such orders after the indictment is presented to commence the trial and before the jury is empanelled – the proceedings are part of the trial of the accused person, and the accused person is to be arraigned again on the indictment when the jury is empanelled for the continuation of the trial." As I have mentioned, the first arraignment of Mr Stephens before a District Court judge took place on 29 November 2018. From that time, pursuant to s 130(2) of the Procedure Act, the Court had jurisdiction in relation to the matter and power to engage in pre-trial processes prior to the empanelment of the jury60. On 5 February 2019, Mr Stephens was arraigned for a second time for the purposes of pre-trial argument and re-pleaded to an indictment that had been amended specifically to take account of s 80AF. The Crown's application for leave to amend the indictment was not opposed. Further, between 29 November 2018 and 5 February 2019, no steps were taken in the prosecution or defence of Mr Stephens. Ultimately, on 7 February 2019, Mr Stephens was arraigned for the third time on the amended 14-count indictment before the jury panel. Under the law of New South Wales, a person can be arraigned on more than one occasion before the empanelment of the jury61. The trial commences after the last arraignment. So much was made clear by Gleeson CJ (with whom Smart and Studdert JJ agreed) in R v Nicolaidis62, where his Honour said63: "Notwithstanding the procedure of arraignment that takes place at the commencement of a trial, it is, and was in November 1992, the practice in the District Court for persons charged with indictable offences to be arraigned within a relatively short time after having been committed for trial and sometimes many weeks or even months in advance of the hearing date of the trial. In such cases, assuming the accused adhered to a plea of not guilty, there would thus be at least two, and perhaps more, arraignments, 60 Stephens v The Queen (2021) 290 A Crim R 303 at 310 [27] per Simpson A-JA. See also GG v The Queen (2010) 79 NSWLR 194 at 206 [71] per Beazley JA (Buddin J 61 R v Janceski (2005) 64 NSWLR 10 at 36 [187] per Wood CJ at CL. (1994) 33 NSWLR 364. (1994) 33 NSWLR 364 at 367. Steward the last being at the commencement of the trial. There is no reason in law why an accused person may not be arraigned on more than one occasion: R v Radley (1973) 58 Cr App R 394; R v Cicchino (1991) 54 A Crim R 358 at 363. No doubt one of the reasons for the procedure of early arraignment after committal is to permit the District Court to take early control of cases for the purpose of pre-trial management: cf Jago v District Court of New South Wales (1989) 168 CLR 23 at 37 and note the provisions of Pt 53 of the District Court Rules 1973." (emphasis added) In R v Janceski64, Howie J agreed with Gleeson CJ and relevantly added that: "[t]he presentation of an indictment and the arraignment of the accused before the jury panel is a step in the proceedings that marks the commencement of the trial" (emphasis added). Here, the actual trial of Mr Stephens thus only became "pending" following his arraignment on 7 February 2019, when the jury was empanelled. The language of s 130(3), directed as it is to issues of procedure, does not justify any contrary conclusion for the purposes of ascertaining the intended scope of application of s 80AF. It follows that when the trial of Mr Stephens commenced on 7 February 2019, s 80AF was already law. Secondly, and in any event, s 80AF was intended to apply to pending criminal proceedings. The extrinsic materials make this clear. Section 80AF was enacted by the Criminal Legislation Amendment (Child Sexual Abuse) Act 2018 (NSW) ("the Amendment Act"). That Act was passed by both houses of the New South Wales Parliament on 20 June 2018 and received royal assent on 27 June 2018. Section 2 of the Amendment Act provided that it was to commence on a day to be appointed by proclamation. By proclamation dated 28 November 2018, the Governor of New South Wales, on advice of the Executive Council, appointed 1 December 2018 as the date on which s 80AF would commence65. The Second Reading Speech that introduced the Amendment Act expressly refers to recommendations for reform made by a departmental discussion paper entitled "Child Sexual Offences Review" ("the Review")66. The Review had been prompted by recommendations made by the Joint Select Committee on Sentencing of Child Sexual Assault Offenders. Chapter 6 of the Review was entitled (2005) 64 NSWLR 10 at 42 [219]. 65 New South Wales, Commencement Proclamation, 2018 No 671, 28 November 66 New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 6 June 2018 at 3; New South Wales, Department of Justice, Child Sexual Offences Review Discussion Paper (2017). "Addressing difficulties arising from historic child sexual offending" and commenced with the following summary: "The prosecution of historic child sexual abuse offences frequently raises complex legal and evidentiary issues. There is often a delay in disclosure, lack of physical or forensic evidence and diminished memory. Determining the appropriate charges can be challenging for the prosecution, particularly where the date of the offence cannot be specified. If convicted, sentencing an offender in accordance with historic sentencing principles is often a difficult task for the court." Chapter 6 included a sub-heading entitled "Date of offence can be difficult to pinpoint". It was here observed that a survivor of child sexual abuse may be able to recall a particular offence but be unable to say with accuracy when the offence occurred. At the time, the practice of the Crown in New South Wales was thus to draft indictments by reference to a date range, rather than a particular date. Difficulties could arise, however, where the law had changed during that period. This occurred here when s 78K of the Crimes Act relevantly succeeded s 81 of the Crimes Act. Paragraph 6.11 of the Review observed that it was common for this problem to emerge "during a trial". It stated: "It is common that during a trial the dates of the alleged offence will be refined or significantly changed. A complainant may recall more details about the time of the offence or it may become apparent that they were mistaken about the time. For example, the complainant may have thought the offence occurred when she was in grade 8 and had just become friends with Sally, however, school records later establish that Sally did not attend the school until grade 9 and thus the offence must have occurred outside of the date range contained in the indictment. The prosecution can make an application to amend the indictment, however, this requires either leave of the court or consent of the defence. Where there is no consent and the application is refused, the accused must be acquitted." (footnote omitted; emphasis added) Given the foregoing, the Review noted that an option for reform would be the introduction of a legislative provision that would permit the Crown to rely on the offence with the lowest maximum penalty where there is "uncertainty about the age of the victim at the time of the offence and the date range falls into more than one offence"67. Section 80AF is the enactment of this recommended reform. Given the mischief identified by the Review, and its express reference to "common" 67 New South Wales, Department of Justice, Child Sexual Offences Review Discussion Paper (2017) at 31 [6.12]. problems emerging "during a trial" concerning the recollection of when offending may have taken place, it is very likely that Parliament intended that s 80AF could apply to a criminal proceeding that had already commenced. The means by which it could apply, as mentioned in the Review, would be by way of an amendment to the indictment. Section 20 of the Procedure Act provides that an indictment may be amended after it has been presented, but only with the leave of the Court or with the consent of the accused. That is precisely what happened here. On 5 February 2019, the indictment was amended with the leave of the Court to allow the Crown to rely on s 80AF. There were also further amendments to the indictment on 11 February 2019 (during the course of the trial) and on 19 February 2019 (after the close of the Crown case). None of these amendments were opposed. With very great respect to the majority, textual considerations arising from the language of s 80AF do not support a contrary conclusion. Section 80AF(1) states that the section "applies if" four conditions are satisfied. In effect, the criteria require that it be "uncertain" as to when, within a "period" of time, conduct always constituting a "sexual offence" against a child under multiple provisions is alleged to have occurred. There is no dispute that all four conditions were satisfied in this instance. Section 80AF(2) then states that "[i]n such a case" – and this proceeding was a case of that kind – a "person may be prosecuted" under whichever of the sexual offences had the lesser maximum penalty regardless of when during that period the conduct actually occurred. In the context of the provision's purpose, the phrase "may be prosecuted" does not preclude the Crown from relying on s 80AF after the "commencement" of a proceeding68. It would make little sense for Parliament to have enacted a provision in response to the Review that did not efficaciously address one of its principal concerns, namely the difficulty of child sexual abuse victims being able to recall particular dates, that being an issue which might only emerge after the trial has already commenced. The phrase "a person may be prosecuted" should be construed, consistently with the purpose of s 80AF, as a reference to any stage in the process of prosecution. That conclusion is supported by the language of s 80AF(1)(a), which refers to a moment when "it is uncertain as to when during a period [of time] conduct is alleged to have occurred". As I have mentioned, paragraph 6.11 of the Review specifically referred to such an uncertainty arising "during a trial". Finally, s 80AF(2) refers to, "in prosecuting [an] offence": (a) any requirement "to establish" that the offence had been in force; and (b) any requirement "to establish that the victim was of a particular age". Again, the reference to "prosecuting" here cannot be confined to a time that only arises before a proceeding is commenced. Of course, it must be accepted that if the prosecution seeks to rely on s 80AF for the first time in a trial that is already well advanced, that may potentially give 68 See [46]. Steward rise to issues of unfairness for a defendant. But a defendant has the protection of s 20 of the Procedure Act. Section 80AF should be read in the context of the Procedure Act, including s 20. No judge would give leave for an indictment to be amended if this would be productive of injustice. For example, an injustice might arise if an amendment would upset or undermine forensic choices made earlier in the trial by a defendant. Here, and inferentially, for the purposes of granting leave to amend the indictment on 5 February 2019, 11 February 2019 and 19 February 2019, the trial judge must have been satisfied that no resultant injustice could thereby arise for Mr Stephens. Certainly, none has been suggested. Thirdly, the foregoing conclusion is consistent with s 80AF's historical focus. The provision is not primarily concerned with prospective offending; it is concerned with past offending. Its aim was to make the prosecution of historical offences more effective, and one of its specific concerns was the frailty of the human mind in recalling the details of past abuse. As the Second Reading Speech makes clear, the Amendment Act not only adopted the recommendation of the Review; it also followed the Royal Commission into Institutional Responses to Child Sexual Abuse. A purpose of the Amendment Act was to provide justice and support for survivors. The New South Wales Attorney-General said69: "The royal commission showed us all the terrible failures of government and non-government institutions to protect children. Survivors' courage in coming forward has given us a unique opportunity to make broad changes to the criminal law, to protect children better and to facilitate prosecutions for child sexual offences so perpetrators can be held accountable. For five years Australians learned about the children in every corner of this country who, over the decades, have been sexually abused while in the care of institutions that should have been keeping them safe. Shockingly, we were also told about the abject failure of these and other institutions, as well as the community, to respond to reports of abuse. The royal commission's final report and its advance volumes bear witness to the stories of survivors of child sexual abuse. The reports provide unparalleled insights into the nature of the problem that must be addressed. Fortunately, the royal commission has provided comprehensive recommendations on how we should go about doing this. One such set of recommendations was in relation to criminal justice and the New South Wales Government is today responding to those by way of this bill. 69 New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 6 June The Government is committed to ensuring that it learns from all the findings of the royal commission. It is determined to make the changes needed to protect children and to provide justice and support for survivors." The Attorney-General specifically described the purpose of s 80AF as follows70: "[T]he bill makes three procedural reforms to facilitate prosecutions for child sexual offences. Schedule 1 [46] inserts a new section 80AF to cover the complexities that currently arise for the prosecution where the offending has taken place during a period and the applicable offence changes during that period. This can happen either because the child's age has changed during the period – meaning that the conduct is covered by a different offence at different times during that period – or because the relevant law has been amended. This can be a problem for the prosecution where it is not clear which offence should apply. Section 80AF will address this. It will ensure that the prosecution can rely on whichever offence carries the lesser maximum penalty, and can rely on this offence in relation to the entirety of the period." It would, with respect, be incongruous to conclude that s 80AF could have no application to a pending trial given the foregoing expressions of legislative purpose. Fourthly, the particular circumstances here confirm that the reasonable expectations of Mr Stephens about what law would apply to his trial were never defeated. When Mr Stephens was arraigned on 29 November 2018, he pleaded not guilty to each count on the original indictment. As the majority explain, that was a "forensic" decision he was able to make having regard to the content of each count at that time71. The majority also observe that the decision was made "on [the] state of the law" as at 29 November 201872. That is partly so. But, as already mentioned, by 29 November 2018, s 80AF had already been enacted and was proclaimed to come into force on 1 December 2018. It was thus already a law of New South Wales73. Indeed, it had been so for many months. Any competent criminal lawyer 70 New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 6 June 71 See [21]. 72 See [21]. 73 See Queensland v Central Queensland Land Council Aboriginal Corporation (2002) 125 FCR 89 at 101-104 [59]-[71] per Beaumont J; Campbell v Employers would have known of its existence and its content on that day. They would have known that its proclamation into force was also pending. They could not have reasonably expected that any trial, also pending, would necessarily be unaffected by s 80AF. Any "forensic" decision about pleading guilty or not guilty or about the possible course of future cross-examination74 could not have been made without taking into account the foregoing reality. The elephant in the room could not possibly have been ignored. On 7 February 2019, Mr Stephens was arraigned again in accordance with s 130(3)(b) of the Procedure Act. The indictment had been amended to take account of the effect of s 80AF and Mr Stephens pleaded afresh to the new counts. By this time, s 80AF was unambiguously in force and Mr Stephens had an opportunity to re-consider forensic decisions about how to plead and about what course cross-examination might take. At this stage, there had been no opening addresses and no witness had been called. Thereafter, Mr Stephens could not have reasonably expected that his trial would be immune from the reach of s 80AF. This conclusion also avoids an injustice that arises here. Mr Stephens was relevantly convicted by a jury on counts 6, 7 and 13. He seeks to have these convictions quashed and acquittals be entered instead, merely because he was formally arraigned for the first time two days before s 80AF came into force. I would dismiss this appeal. Mutual Ltd (2011) 110 SASR 57 at 74 [69] per Gray and Sulan JJ, 96-97 [182] per 74 See [38].

HIGH COURT OF AUSTRALIA GUMLAND PROPERTY HOLDINGS PTY LIMITED APPELLANT AND DUFFY BROS FRUIT MARKET (CAMPBELLTOWN) PTY LIMITED & ORS RESPONDENTS Gumland Property Holdings Pty Limited v Duffy Bros Fruit Market (Campbelltown) Pty Limited [2008] HCA 10 27 March 2008 ORDER Appeal allowed. Special leave to cross-appeal granted; cross-appeal treated as instituted and heard instanter and dismissed. Set aside the judgment for the appellant against the first respondent in the amount of $362,232 and, in its place, restore the judgment, given by the trial judge, for the appellant against the first respondent in the amount of $2,096,514, plus interest on that sum from 28 March 2006 calculated in accordance with s 101 of the Civil Procedure Act 2005 (NSW). Set aside the order relating to costs between the appellant and the first respondent and, in its place, order that the first respondent pay the appellant's costs of the proceedings before the trial judge, of the appeal to the Court of Appeal of the Supreme Court of New South Wales and of the appeal and cross-appeal to this Court. Set aside the judgment for the appellant against the second and third respondents for $362,232 and, in its place, give judgment for the appellant against the second and third respondents in the amount of $2,096,514, plus interest on that sum from 28 March 2006 calculated in accordance with s 101 of the Civil Procedure Act 2005 (NSW). The second and third respondents to pay the appellant's costs of the appeal and cross-appeal to this Court. On appeal from the Supreme Court of New South Wales Representation J N West QC with N J Kidd PricewaterhouseCoopers Legal) for the appellant (instructed by G C Lindsay SC with R G H Keller for the respondents (instructed by MJ Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Gumland Property Holdings Pty Limited v Duffy Bros Fruit Market (Campbelltown) Pty Limited Contracts – Termination for breach – Damages – Ability to recover substantial damages after termination where termination based on express provision making contractual term essential. Contracts – Lease – Breach of term by lessee – Whether lessor entitled after terminating lease to recover loss of bargain damages where but for express contractual provisions providing for the consequences of breach the lessor would not have been entitled to terminate. Real property – Lease – Covenants that touch and concern the land – Whether the right to seek damages for breach of covenant to pay rent touches and concerns the land – Whether the assignee of a leasehold reversion is entitled to terminate a lease and recover loss of bargain damages, notwithstanding the absence of privity of contract between the assignee and lessee. Real property – Lease – Guarantors – Whether guarantor's covenant to guarantee payment of rent by the lessee touches and concerns the land and passes with the leasehold reversion. Conveyancing Act 1919 (NSW), s 117. GLEESON CJ, KIRBY, HEYDON, CRENNAN AND KIEFEL JJ. The question in this appeal is whether a commercial lease was validly terminated on the ground of the lessee's failure to pay rent, and, if so, what the monetary consequences were. In the Equity Division of the Supreme Court of New South Wales the trial judge (Macready As J) held that it was1. The Court of Appeal, in reasons for judgment delivered by Giles JA, with which Santow JA and Tobias JA concurred, held that it was not2. The factual background The Lease. Transit Management Pty Ltd ("the Lessor") owned premises in a shopping centre ("the Demised Premises"). The Lessor granted a lease of the Demised Premises ("the Lease"). The lessee, who is the first respondent in this appeal, was Duffy Bros Fruit Market (Campbelltown) Pty Ltd ("the Lessee"). In the Lease the expression "Lessor" was defined as meaning "the Lessor its successors and assigns". The term of the Lease was 15 years. The commencing date was 30 March 1993. The Demised Premises were subject to the Real Property Act 1900 (NSW) ("the Real Property Act"), and the Lease was registered pursuant to that Act. By cll 1.18 and 14.1 of the Lease, the "Permitted Use" of the Demised Premises, which were described as "Shop 10" and comprised 19.65 percent of the shopping centre, was that of a fruit, vegetable and meat market. The base rent was $245,343 per annum. In addition, by cl 4, the Lessee was obliged to pay 19.65 percent of the Lessor's "Outgoings". By cl 5, the rent was subject to increase in the light of the Consumer Price Index. By cll 1.21-1.22 and 6, the rent was also subject to review every five years. By cl 3.1, the Lessee covenanted to pay to the Lessor and the Lessor's "assigns" the base rent, together with any CPI increases pursuant to cl 5 and any review increases pursuant to cl 63. Clause 3.2 provided: "The Lessee covenants to pay the annual rent by equal monthly instalments in advance and to pay the rent and other monies hereby 1 Gumland Property Holdings Pty Ltd v Duffy Bros Fruit Market (Campbelltown) Pty Ltd [2006] NSWSC 10. 2 Duffy Bros Fruit Market (Campbelltown) Pty Ltd v Gumland Property Holdings Pty Ltd; Gumland Property Holdings Pty Ltd v Pisciuneri (2007) ANZ Conv R 3 The Lease, cl 3.1, erroneously stated "7" instead of "6". Kirby Crennan secured within seven (7) days of the day on which each monthly instalment of rent falls due or the other monies secured become payable The Lease contained several provisions which, it was contended, bore on the essential character of the obligation to pay rent and the entitlement to damages if that obligation were broken. Clause 1.13 provided: "It shall be a fundamental obligation of the Lessee to ensure that the Lessor shall receive the rental provided for in the Lease during the full term thereof." Clause 7.1 provided: "Each of the covenants by the Lessee which are specified in this clause are essential terms of this Lease." The first of the covenants specified in cl 7.1 was cl 3, for cl 7.1.1 provided: "The covenant to pay rent throughout the lease term at a date not later than seven (7) days after the due date for the payment of each monthly instalment of rent and any other monies payable under the terms of this Lease (clause 3)." Clause 7.1.3 specified as another of the covenants which were essential terms "[c]lause 12 regarding the right of the Lessor to terminate the Lease"4. Clause 7.2 provided: 4 Clause 12 provided: "The Lessor may re-enter the Demised Premises or any part thereof in the name of the whole and thereby determine the estate of the Lessee therein not only on the happening of the events entitling the Lessor so to do under the terms of the Real Property Act, 1900, and/or the Conveyancing Act, 1919, but also on the happening of any of the following events ... " The first of the events listed was described thus in cl 12.1: "Upon the Lessee being in arrears for a period of seven (7) days in the payment of any monthly instalment of rent or any other monies payable under the terms of the Lease and notwithstanding that no formal demand has been made." Kirby Crennan "In respect of the Lessee's obligation to pay rent and other monies payable under the terms of the Lease including the Memorandum, the acceptance by the Lessor of arrears or of any late payment of rent or other monies payable shall not constitute a waiver of the essentiality of the Lessee's obligation to pay rent and any other monies in respect of the Lessee's continuing obligation to pay rent and all monies payable hereunder during the Lease term." Clause 7.4 provided: "In the event that the Lessee's conduct (whether acts or omissions) constitutes a repudiation of the Lease (or of the Lessee's obligations under the Lease) or constitutes a breach of any Lease covenants, the Lessee covenants to compensate the Lessor for the loss or damage suffered by reason of the repudiation or breach." Clause 7.5 provided: "The Lessor shall be entitled to recover damages against the Lessee in respect of repudiation or breach of covenant for the damage suffered by the Lessor during the entire term of this Lease." Clause 7.6 provided: "The Lessor's entitlement to recover damages shall not be affected or limited by any of the following: 7.6.1 If the Lessee shall abandon or vacate the Demised Premises; 7.6.2 If the Lessor shall elect to re-enter or to terminate the lease; 7.6.3 If the Lessor shall accept the Lessee's repudiation; or 7.6.4 If the parties' conduct shall constitute a surrender by operation of law." Clause 7.7 provided: "The Lessor shall be entitled to institute legal proceedings claiming damages against the Lessee in respect of the entire Lease term, including the periods before and after the Lessee has vacated the Demised Premises, termination, repudiation, the abandonment, and before and after Kirby Crennan acceptance of repudiation or surrender by operation of law referred to in paragraph 7.6, whether the proceedings are instituted either before or after such conduct." Clause 7.8 provided, relevantly: "In the event of the Lessee vacating the Demised Premises, whether with or without the Lessor's consent, the Lessor shall be obliged to take reasonable steps to mitigate his damages and to endeavour to lease the Demised Premises at a reasonable rent and on reasonable terms ..." Clause 16 provided: "The determination of the Lease shall not prejudice or affect any rights or remedies of the Lessor against the Lessee or any person or company jointly liable with the Lessee on account of any antecedent breach by the Lessee of any of the terms, covenants and restrictions on the part of the Lessee. Further the Lessee acknowledges that it is the Lessee's fundamental obligation to ensure that the Lessor shall receive the rental provided for in this Lease during the full term thereof and in the event that the Lease is determined consequent upon default of the Lessee then the Lessee shall be liable to the Lessor for the full loss and/or damages suffered by the Lessor by reason of the non-receipt of such rental for the full term or the non-receipt of any part of it ..." Guarantees. On 25 March 1994, Ferdinando Pisciuneri ("the second respondent") and Natale Pisciuneri ("the third respondent") each entered a guarantee ("the Guarantees"). Clause 2 provided: "The Guarantor guarantees to the Lessor the payment to the Lessor of all monies now or hereafter to become payable to the Lessor by reason of the use or occupation of the said premises or by reason of any provisions of any relevant lease whether for rental, interest, damages, mesne profits or otherwise and on any account and whether by the Lessee or any other person during the term of operation of this agreement as defined in clause 4 hereof and guarantees also the payment to the Lessor of all monies now or hereafter to become payable to the Lessor by reason of or arising out of any breach of an agreement to lease the said premises." Recital B stated: "It is intended that the benefit of this Guarantee shall subsist for the benefit of not only the First Lessor but any person or company who may Kirby Crennan become the Lessor of the said premises to the Lessee (as hereinafter defined)." Clause 1(f) provided: "'Lessor' shall mean the First Lessor whilesoever the First Lessor owns the freehold of the said premises without granting a concurrent lease thereof and thereafter shall mean the person or company who shall be the owner of the freehold of the said premises to the Lessee or holder of the leasehold estate subject to the lease to the Lessee hereinafter defined but with the intent that rights accrued in favour of the First Lessor or any subsequent Lessor as at the date of change of ownership of the freehold or granting of any such concurrent lease shall remain enforceable against the Guarantor." Clause 1(g) provided: "'Lessee' shall mean the First Lessee until the First Lessee shall assign its right of occupation of the said premises with the consent of the Lessor and thereafter shall mean each person or company who is in occupation or shares in the occupation of the said premises during the term of operation of this agreement as defined in clause 4 hereof." The "First Lessor" was defined as the Lessor (ie Transit Management Pty Ltd). The 1999 Deed. By 1999 the Lessee had experienced difficult trading conditions, and had fallen into arrears with rent and outgoings. On 2 March 1999 the Lessor and the Lessee entered a Deed ("the 1999 Deed"). The 1999 Deed relevantly did four things. First, it contemplated the creation of a sub-lease over part of the Demised Premises. To that end the Lessee appointed each of the directors of the Lessor as its attorney to locate sub-lessees and enter sub-leases on such terms and conditions as the Lessor saw fit. It also agreed, by cl 4.2, that it would be a term of any sub-lease that the sub-lessee pay all rent and outgoings direct to the Lessor (including the Lessor's assigns). Secondly, the 1999 Deed, while providing for the payment of arrears of rent and outgoings, reduced the rent payable by the Lessee. In the events which happened, it was reduced to $156,000 per annum. But the reduction was subject to conditions appearing in cll 10.1 and 10.2. If the Lessee did not commit any further breach of the terms of the Lease defined as essential in cl 7 of the Lease, Kirby Crennan or any breach of the 1999 Deed itself, the Lessee would not be obliged to pay the full monies due as rent and outgoings under the Lease, but only arrears up to the time of the Deed (cl 10.2(a)), the sum of $156,000 per annum from that time (cl 10.2(b)), and rent and outgoings recovered under any sub-lease (cl 10.2(c))5. Thirdly, in cl 11 the parties agreed that "the Lease is further varied" by the deletion of cl 21, which was a covenant by the Lessor not to permit other fruit or meat markets in the shopping centre. 5 Clause 10.1 provided: "For the purpose of interpreting clause 10.2 any payment due by [the Lessee] under Clause 10.2(d) is not due and payable until the 29th March, 2008 or upon an earlier Scheduled Breach of the Lease by [the Lessee] or an earlier breach of this Deed by [the Lessee] which subsists for a period of 7 days after [the Lessor] has given notice to [the Lessee] of such breach." Clause 10.2 provided: "[The Lessee] shall pay to [the Lessor] the aggregate of the following sums for rent and outgoings payable by [the Lessee] under the Lease: (a) the arrears in accordance with clauses 6 and 7 of this Deed, (b) the First Higher Sum, Higher Sums and the Final Higher Sum in accordance with clause 8 of this Deed, (c) all rent and outgoings under any such sublease entered into pursuant to clause 4 of this Deed, and (d) the Sum by which the rent and outgoings payable by [the Lessee] under the Lease up to the date the Lease terminates exceeds the aggregate of sums received under clauses 10(a) (b) and (c). PROVIDED THAT if the Lease terminates on the 29th March, 2008 without any continuing Scheduled Breach of the Lease or breach of this Deed by [the Lessee] then [the Lessor] shall accept the sums payable under clause 10(a), (b) and (c) hereof in satisfaction of rent and outgoings payable by [the Lessee] under the Lease." A "Scheduled Breach" was defined as a breach of the Lease defined in cl 7 of the Lease as an essential term. Kirby Crennan Finally, by cl 2, the 1999 Deed provided: "Subject to the terms of this Deed the parties ratify and affirm the terms of the Lease." Confirmations by the second and third respondents. On 2 March 1999 the second and third respondents each entered deeds with the Lessor acknowledging that the Lessor and the Lessee had that day entered the 1999 Deed "whereby the terms of the Lease are varied". The Sub-Lease. Pursuant to the 1999 Deed, on 3 December 1999 the Lessee sub-leased to Austie Nominees Pty Ltd the part of the Demised Premises identified for the purpose of sub-letting in the 1999 Deed ("the Sub-Lease"). As had been contemplated by the 1999 Deed, the Sub-Lease was executed for and on behalf of the Lessee by the directors of the Lessor. The term was three years, with two options to renew for three years. Transfer of the sub-lessee's interest in the Sub-Lease. On 30 October 2001, Austie Nominees Pty Ltd transferred its interest as sub-lessee in the Sub-Lease to Woolworths Ltd ("Woolworths"). Transfer of freehold in Demised Premises. On 6 September 2001 the Lessor agreed to transfer the Demised Premises to Gumland Property Holdings Pty Ltd, the appellant in these proceedings ("the appellant"). This agreement ("the Sale Contract") was completed on 5 December 2001. The prelude to litigation. The initial term of the Sub-Lease was to expire on 31 July 2002. Woolworths then informed the Lessee that it did not wish to exercise its option to renew the Sub-Lease. However, it remained in occupation under the holding over provisions of the Sub-Lease, while choosing unilaterally to pay only half the rent payable. The Court of Appeal described this decision as "a stark breach" of Woolworths' obligations, and no party in this Court disputed that finding. The consequence of Woolworths' breach was to put the Lessee into breach of cl 10.2(c) of the 1999 Deed, since the Lessee did not pay the shortfall itself. By a notice served on the Lessee on or about 3 July 2003 the appellant contended that the shortfall in rent under the Sub-Lease occasioned by Woolworths' failure to pay the full rent was a breach of the Lease entitling it, inter alia, to terminate the Lease. It demanded payment of the amount of the shortfall, $57,893.55. The Lessee did not pay, and on 1 August 2003 the appellant gave a notice terminating the Lease. Kirby Crennan The litigation begins. On 5 March 2004 the appellant commenced proceedings against the Lessee. It sought arrears of rent up to the date of termination of the Lease (1 August 2003). It also sought loss of bargain damages for the rest of the 15 year term (which was to expire on 29 March 2008). And it sought damages for the costs of reletting the Demised Premises after termination of the Lease ("the reinstatement damages"). In addition, it sued the second and third respondents as guarantors of the Lessee's obligations under the Lease. The Deed of Assignment. On 5 May 2005 the Lessor and the appellant entered a Deed of Assignment, pursuant to which the Lessor transferred all its rights under the Lease and the 1999 Deed to the appellant. The Lessee was given notice of the assignment by letter of 5 May 2005. The trial judge Those aspects of the trial judge's reasoning which relate to the issues raised in this appeal are as follows. First, the failure of Woolworths and of the Lessee to pay the whole of the rent under the Sub-Lease put the Lessee in breach of cl 10.2 of the 1999 Deed. Since cl 10.2 commenced with the words "[The Lessee] shall pay to [the Lessor] the aggregate of the following sums for rent and outgoings payable by [the Lessee] under the Lease"6, cl 10.2 was an amendment of cl 3 of the Lease, and hence the Lessee was also in breach of cl 3 of the Lease. Since cl 7.1.1 of the Lease made cl 3 an essential term, the appellant was entitled to terminate the Lease. Secondly, he found that the Lessee's failure to pay the rent which Woolworths had not paid was a breach of an express essential term of the Lease, giving rise to a right to loss of bargain damages as well as arrears of rent. Thirdly, he gave judgment for the appellant against the Lessee in the sum of $2,096,514 with effect from 28 March 2006. This figure had four components. The first was the shortfall of payments by Woolworths payable under cl 10.2(c) of the 1999 Deed: $57,415 with interest of $21,220, a total of 6 See above, n 5. Kirby Crennan The second was the arrears of rent and outgoings payable under cl 10.2(d) of the 1999 Deed: $215,724 with interest of $67,873, a total of $283,597. The third was the quantum of loss of bargain damages (the difference between the rent and outgoings payable to the appellant under the Lease after 1 August 2003 until 29 March 2008 and those amounts it had received or was likely to receive from new tenants, discounted down to present value). With interest, the relevant figure was $1,624,737. The fourth was the reinstatement damages: $62,411.34 which with interest totalled $109,545. Finally, the trial judge dismissed the appellant's claim against the second and third respondents on their Guarantees. He held that they were discharged by reason of the fact that the 1999 Deed required a sub-lease under which the sub-lessee was to pay the rent directly to the Lessor, and the Sub-Lease entered did not contain that term. The Court of Appeal Of the four components making up the judgment sum set out above7 the Court of Appeal did not disagree with the trial judge's award in relation to arrears of rent (ie items (a) and (b)). However, it held that the appellant was not entitled to loss of bargain damages (item (c)) or reinstatement damages (item (d)) because it was of the view that the appellant had not been entitled to terminate the Lease. It took that view because it treated the Lessee's failure to pay the shortfall in payment by Woolworths as being only a breach of cl 10.2(c) of the 1999 Deed, not a breach of cl 3 of the Lease. In those circumstances the Court of Appeal did not deem it necessary to consider certain issues which the Lessee had raised8. However, the Court of Appeal did reverse the trial judge's decision in relation to the Guarantees. Accordingly it reduced the judgment sum against the Lessee to $362,232, but also gave judgment in that sum against the second and third respondents. 7 See [20]. In particular, questions (c) and (d) below. Kirby Crennan Issues in this Court The appellant relied on a Notice of Appeal and the Lessee on a Notice of Contention. The Lessee also sought special leave to cross-appeal. That leave should be granted. To examine the issues in the order in which they appear in the Notice of Appeal, the Notice of Contention and the Notice of Cross-Appeal is not the most rational course. A more rational order is as follows. (a) Was the Lessee in breach of cl 10.2(c) of the 1999 Deed? If yes to (a), was that breach a breach of cl 3 of the Lease? If yes to (b), did cl 7.1.1 of the Lease render that breach of cl 3 a breach of an essential term of the Lease entitling the appellant to terminate the Lease and (subject to question (d)) obtain an award of loss of bargain damages? If yes to (c), did s 117 of the Conveyancing Act 1919 (NSW) ("the Conveyancing Act") entitle the appellant to recover loss of bargain damages for breach of cl 3? If no to (d), was there an assignment by the Lessor to the appellant of the benefit of all the covenants in the Lease and the 1999 Deed by: the Sale Contract; or the Deed of Assignment? If no to (d) and (e), was the Lessee estopped from denying that the appellant could take advantage of the Lease and the 1999 Deed? If the appellant were entitled to recover loss of bargain damages, was the quantum to be limited by assuming that the Lessee complied with cl 10 of the 1999 Deed? (h) Were the second and third respondents liable on the Guarantees for the whole of the judgment against the Lessee? (a) Was the Lessee in breach of cl 10.2(c) of the 1999 Deed? This question was raised in the Lessee's Notice of Cross-Appeal. An answer favourable to the Lessee would result in the Court of Appeal's orders that the Lessee pay arrears of rent up to the date of termination of the Lease being set Kirby Crennan aside, giving both the Lessee and the second and third respondents complete success in the proceedings. That answer, however, is one which both courts below declined to give. The Lessee advanced three arguments for the view that it had never breached cl 10.2(c). Clause 10.2(c) as an accounting provision? The Lessee noted that cl 4.2 of the 1999 Deed required that it be a term of any sub-lease granted under cl 4 that the sub-lessee pay all rent and outgoings directly to the Lessor. The Lessee submitted that, when cl 10.2(c) was read with cl 4.29, its context indicated that any sub-lessee would pay rent and outgoings to the Lessor, and that the obligation in cl 10.2(c) would arise only if the Lessee rather than the Lessor (or the appellant) received monies from a sub-lessee. The Lessee in fact withheld no monies from the appellant which were received from Woolworths. In rejecting that argument, the Court of Appeal pointed out that the 1999 Deed contemplated that thereafter the Lessee would only occupy part of the Demised Premises and that the other part, which the Court of Appeal called "Shop 10A", would be sublet. Until subletting, apart from arrears, dealt with in cl 10.2(a), cl 10.2(b) provided that the Lessee was only obliged to pay the amounts described in cl 8 as the "First Higher Sum", "Higher Sum" and the "Final Higher Sum". These "Higher Sums" were calculated as being whichever was the higher of a percentage of the Lessee's gross receipts, or $156,000 per annum. Thus they were referable to the Lessee's own trading on the part of the Demised Premises it continued to occupy. It was obliged to pay nothing in relation to the other part, Shop 10A, until it was sublet. The Court of Appeal said10: "The purpose of cl 10.2(c) was that, when Shop 10A was sub-leased, there should also be payable by [the Lessee] for rent and outgoings the cl 10.2(c) amount, an amount referable to the rent and outgoings for which the sub-lease provided but payable for rent and outgoings payable under the Lease. In short, if the right to possession of Shop 10A became 9 See above at [6]. 10 Duffy Bros Fruit Market (Campbelltown) Pty Ltd v Gumland Property Holdings Pty Ltd; Gumland Property Holdings Pty Ltd v Pisciuneri (2007) ANZ Conv R 153 Kirby Crennan remunerative because Shop 10A was sub-leased, then what [the Lessee] had to pay was correspondingly increased." The Court of Appeal also said11: "Clause 10.2(c) ensured that [the Lessor] would be paid by [the Lessee] an equivalent amount to the rent and outgoings payable under a sub-lease if, contrary to an expected direct payment term, the sub-lessee did not pay [the Lessor]. It was concerned with payment of what was not paid, not with passing on what was paid." Finally, the Court of Appeal said that if cl 10.2(c) were given the construction advocated by the Lessee, and a sub-lessee failed to pay the Lessor direct, the Lessor would only have a right of action against the Lessee in relation to sums it actually received. Any claim the Lessor might make against any sub-lessee would be a "doubtful" claim as "third party beneficiary". The Court of Appeal said12: "[I]t would not have been sensible for [the Lessor] to accept under the 1999 Deed a doubtful ability to sue the sub-lessee as a third party beneficiary in lieu of a clear right of action against [the Lessee]". That clear right of action lies on the Court of Appeal's construction. The Court of Appeal saw the non-sensible result of the Lessee's submission as pointing against its correctness. The Court of Appeal's reasoning should be accepted. Sub-Lease not a "sub-lease pursuant to cl 4" of the 1999 Deed? The Lessee argued that the Sub-Lease was not a "sub-lease pursuant to clause 4" of the 1999 Deed, because it did not contain the term required by cl 4.2. The Court of Appeal held that cl 4.2 "did not state a condition of achieving a valid sub-lease, but an expectation of a term that 'will be' in the sub-lease"; it merely reflected the Lessee's agreement that the Lessor could put a direct payment term in any sub-lease it entered in exercise of the power conferred by the Lessee on 11 Duffy Bros Fruit Market (Campbelltown) Pty Ltd v Gumland Property Holdings Pty Ltd; Gumland Property Holdings Pty Ltd v Pisciuneri (2007) ANZ Conv R 153 12 Duffy Bros Fruit Market (Campbelltown) Pty Ltd v Gumland Property Holdings Pty Ltd; Gumland Property Holdings Pty Ltd v Pisciuneri (2007) ANZ Conv R 153 Kirby Crennan the directors of the Lessor to enter sub-leases13. The Lessee offered no answer to this reasoning, and in that state of affairs it should not be overturned. In addition, cl 4.2 was wholly for the benefit of the Lessor, and was capable of being waived by it, acting through its directors when they exercised their unlimited authority to enter the Sub-Lease. Liability of Lessee for sub-lessees? The Lessee submitted on the appeal that it "had no primary or secondary liability under or by reference to clause 10.2(c) for moneys payable by a sub-lessee. It was the sub-lessor." Read one way, this does no more than state the desired conclusion without offering any reason for reaching it. Read another way, it appeals to the incongruity of a sub-lessor being liable for a sub-lessee's defaults: but, as the Court of Appeal suggested14, that is to overlook the fact that the Lessee was not only the sub-lessor but also a lessee. It was lessee of, and liable under the Lease for, the area comprised by Shop 10A, and it was consistent with the scheme of the 1999 Deed that once Shop 10A was sub-leased, it should pay the rent and outgoings under any sub-lease. In this instance too no argument was advanced by the Lessee as to why the Court of Appeal's approach was wrong, and in those circumstances it should not be rejected. It follows that question (a) must be answered "Yes". If yes to (a), was that breach a breach of cl 3 of the Lease? The Lessee argued that the breach of cl 10.2(c) of the 1999 Deed was not a breach of cl 3 of the Lease. It argued that cl 10.2 did not operate as an amendment of the Lease in the sense that it substituted the sums referred to in cl 10.2 for the amounts of rent and outgoings referred to in cll 3-5 of the Lease. It argued that cl 10.2 was instead a separate personal contract between the Lessor and the Lessee in the nature of a side-agreement which merely suspended the operation of cll 3-5 and 7.1.1 of the Lease. It argued that the expression "sums for rent and outgoings payable by [the Lessee] under the Lease" in the opening 13 Duffy Bros Fruit Market (Campbelltown) Pty Ltd v Gumland Property Holdings Pty Ltd; Gumland Property Holdings Pty Ltd v Pisciuneri (2007) ANZ Conv R 153 14 Duffy Bros Fruit Market (Campbelltown) Pty Ltd v Gumland Property Holdings Pty Ltd; Gumland Property Holdings Pty Ltd v Pisciuneri (2007) ANZ Conv R 153 Kirby Crennan part of cl 10.2 did not mean that the sums referred to in cl 10.2 were to be paid "as" rent and outgoings payable under the Lease, but "in lieu of" rent and outgoings payable under the Lease. Finally, it argued that cll 3 and 7.1.1 of the Lease could have no operation until cl 10.2 was terminated, which it never was. To some extent the Court of Appeal's reasoning was inconsistent with the Lessee's argument. The Court of Appeal held that the Lessee "was liable as lessee for the cl 10.2(c) amount ... The 1999 Deed changed the timing and amount of what it had to pay 'for rent and outgoings payable by [the Lessee] under the Lease', but whatever it had to pay was still for rent and outgoings for the whole of" the Demised Premises15. The Court of Appeal further found that the change in timing and amount "could aptly be described as a variation of the Lease because [the Lessee's] obligations changed: at least as to timing and, depending on cl 10.1 and the proviso, also as to overall amount"16. Later, dealing with another issue, the Court of Appeal said that "the 1999 Deed provided a new regime for the timing and amounts for payment of the rent and outgoings payable under the Lease". It continued17: "But it did so in a manner plainly intended to preserve to [the Lessor] recovery of the rent and outgoings payable under the Lease, if there was breach within cl 10.1 or if at the time of termination there was continuing breach contrary to the proviso. That is apparent from the continuance of the Lease with [the Lessee] as lessee of the area of the original Shop 10, and its ratification and affirmation subject to the terms of the 1999 Deed in cl 2 of that Deed; from cl 10.1, the effect of which was to defer payment subject to a condition; from the reference to the amounts in cl 10.2 as sums for rent and outgoings payable by [the Lessee] under the 15 Duffy Bros Fruit Market (Campbelltown) Pty Ltd v Gumland Property Holdings Pty Ltd; Gumland Property Holdings Pty Ltd v Pisciuneri (2007) ANZ Conv R 153 16 Duffy Bros Fruit Market (Campbelltown) Pty Ltd v Gumland Property Holdings Pty Ltd; Gumland Property Holdings Pty Ltd v Pisciuneri (2007) ANZ Conv R 153 17 Duffy Bros Fruit Market (Campbelltown) Pty Ltd v Gumland Property Holdings Pty Ltd; Gumland Property Holdings Pty Ltd v Pisciuneri (2007) ANZ Conv R 153 Kirby Crennan Lease; from the proviso referring to acceptance of the sums payable under cl 10.2(a), (b) and (c) in satisfaction of rent and outgoings payable by [the Lessee] under the Lease; and from the conditionality of the proviso." The reasoning described in these passages referred to in the last two paragraphs is correct. Below it is referred to as "the Court of Appeal's correct reasoning". However, the Court of Appeal concluded that the failure of the Lessee to pay under cl 10.2(c) was only a breach of the 1999 Deed and not of the covenant to pay rent under the Lease in cl 3. It did so for reasons inconsistent with the Court of Appeal's correct reasoning. It drew to attention the definition of "Scheduled Breach of the Lease" in cl 1.1(p) of the 1999 Deed as meaning "a breach of the Lease as defined in paragraph 7 of the Lease as essential terms of the Lease". The Court of Appeal said18: "The definition of 'Scheduled Breach of the Lease' took up numbered clauses of the Lease as found in cl 7.1, not their subject matter independently of the numbered clauses. The source of [the Lessee's] obligation to pay the cl 10.2(c) amount was cl 10.2. It was not cl 3 of the Lease." However, this reasoning does not detract from the force of the Court of Appeal's correct reasoning set out earlier. The failure to pay the cl 10.2(c) amounts was a failure to comply with the covenant in cl 3 of the Lease to pay rent and outgoings. The Court of Appeal's correct reasoning is supported by the following further considerations. Clause 2 of the 1999 Deed provided that "the parties ratify and affirm the terms of the Lease". In cl 11 it was agreed that the Lease be "further varied" by deleting cl 21. The 1999 Deed did not purport to operate as a side-agreement to the Lease, or a suspension of it, but a variation of it. It did not purport to suspend the operation of any clauses of the Lease; in numerous respects it took the terms of the Lease as a starting point, and has to be construed with the Lease as an amendment of the Lease. Thus the 1999 Deed did not create a fresh independent obligation to pay rent; it amended the obligation to do so under cl 3 of the Lease. The obligations to pay the sums in cl 10.2 were in substitution for the potentially high obligations under the Lease, but they were 18 Duffy Bros Fruit Market (Campbelltown) Pty Ltd v Gumland Property Holdings Pty Ltd; Gumland Property Holdings Pty Ltd v Pisciuneri (2007) ANZ Conv R 153 at 162 [136]; see also at 169 [177]. Kirby Crennan obligations to pay "sums for rent and outgoings payable by [the Lessee] under the Lease". This point is reinforced by the proviso to cl 10.2, which obliged the Lessor to accept the sums described in cl 10.2(a)-(c) "in satisfaction of rent and outgoings payable by [the Lessee] under the Lease". Certain arguments of the Lessee to the effect that the covenant to pay rent on the Lease was not an essential term are considered below and rejected19. In those circumstances, the Lessee's arguments on the interrelationship between the Lease and the 1999 Deed have a strange result. When the parties originally arrived at agreement on the status of the covenant to pay rent, they made it essential. But when, to use the words of Recital L to the 1999 Deed, "[a]fter extensive negotiations", the parties expressed a "wish to continue their commercial relationship" based on the circumstances as they developed over the six years from 1993, and arrived at the new arrangements in the 1999 Deed, they made the cl 10.2 covenant to pay "the following sums for rent and outgoings payable by [the Lessee] under the Lease" non-essential. In short, if the Lease and the 1999 Deed are read as having the relationship favoured by the Lessee, the 1999 Deed makes the covenant to pay rent, which they had taken much trouble to make essential in 1993, non-essential in 1999. This is a highly unlikely outcome. That is so particularly where the lesser and supposedly non-essential obligations of the 1999 Deed were contingent upon there being not only no "breach of this Deed" but also no "continuing Scheduled Breach of the Lease" by the Lessor – and the obligations breached by any "Scheduled Breach" were essential obligations20. The change which the Lessee's argument entails is so unreasonable and so difficult to explain as to suggest that the Lessee's argument is invalid. 20 See note 5 above. In the course of argument a suggestion arose that cl 15 supported the Court of Appeal's conclusion: it revealed that the Lessor wanted its compromise with the Lessee not to be recorded on the register, so that other tenants would not be encouraged to seek similar concessions. The Lessee did not adopt this suggestion, and in any event the appellant correctly pointed out that cl 15 was neutral in that it was capable of operating in favour of the Lessee as well as the Lessor: the 1999 Deed amended the Lease by omitting cl 21, so as to permit the Lessor to introduce another fruit and vegetable seller to become a tenant of the shopping centre and cl 15 prevented any such new competitor of the Lessee to learn of the weakened competitive position of the Lessee which was revealed by its need to enter the 1999 Deed. Kirby Crennan For those reasons the answer to question (b) is "Yes". If yes to (b), did cl 7.1.1 of the Lease render that breach of cl 3 a breach of an essential term of the Lease entitling the appellant to terminate the Lease and (subject to question (d)) obtain an award of loss of bargain damages? For the Court of Appeal this question did not arise, since it held that the breach was a breach only of cl 10.2(c) of the 1999 Deed, not of cl 3 of the Lease. The starting point of the Lessee's arguments was the following proposition, enunciated by Gibbs CJ in Shevill v Builders Licensing Board21: "It is clear that a covenant to pay rent in advance at specified times would not, without more, be a fundamental or essential term having the effect that any failure, however slight, to make payment at the specified times would entitle the lessor to terminate the lease." The Lessee also referred to the next sentence in Gibbs CJ's reasons for judgment22: "However, the parties to a contract may stipulate that a term will be treated as having a fundamental character although in itself it may seem of little importance, and effect must be given to any such agreement." The Lessee described stipulations of that kind as "anti-Shevill clauses", and submitted that cl 7 of the Lease was an extreme example of one. The Lessee then put two alternative propositions. The first was that the parties cannot give the landlord a right to terminate a contract for breach of a term merely by declaring it to be "essential", unless the tenant's breach was repudiatory, or the tenant's breach was a fundamental breach, or the term was in truth essential in the sense of going to the root of the contract. The second, narrower, proposition was that it is open to the parties to declare a term to be essential, entitling the innocent party to terminate for breach, but that that declaration is incapable of giving a right to sue for loss of bargain damages, unless the non-innocent party's conduct amounted to repudiation or fundamental breach. The Lessee submitted that if a clause went so far as to provide not only 21 (1982) 149 CLR 620 at 627; [1982] HCA 47. 22 (1982) 149 CLR 620 at 627. Kirby Crennan that the covenant to pay rent was an essential term but also that on termination for breach an action for loss of bargain damages lay, it would be ineffective. In this case, of course, cll 7.3-7.8, 12 and 16 did go that far23. In relation to each proposition, the Lessee contended that there was here no repudiation and no fundamental breach. That may be accepted: the appellant was not given special leave to contend in this Court that there was. The Lessee endeavoured to support the two propositions by various arguments. In the end these arguments fell back on attempts to support the second proposition only, because early in oral argument counsel for the Lessee accepted that it was open to the parties to a lease to stipulate that a contract could be terminated for a particular breach, however minor, and that this effect was achieved by agreeing that the term was "essential". Proper construction of Lease as a whole. The first argument of the Lessee was that on the proper construction of the Lease as a whole, in view of the fact that a tenant's failure to pay rent is not necessarily repudiatory, the obligation to pay rent within the time limited by cll 3 and 7.1.1 was not truly a fundamental or essential term. It was not enough to "attribute a particular legal characterisation" to a term, and it was not enough that the contract "labels" the term "essential". A fundamental difficulty with the Lessee's submission is that it is not correct to describe the appellant's claim to loss of bargain damages as one which depends on treating cl 7.1.1 only as attributing to the obligation to pay rent a characterisation as "essential". Nor is it correct to say that cl 7.1.1 merely fixed a "label" to that effect. The essentiality of the obligation in cl 3.3 does not rest only on cl 7.1.1. It is reinforced by several other provisions. One is the stipulation in cl 1.1324 that it was a "fundamental obligation" of the Lessee to ensure that the Lessor received the rental. Another is cl 12.1, giving the Lessor the right to re-enter the Demised Premises and determine the Lease where the Lessee is in arrears for seven days in the payment of rent, without formal demand25. A third is the acknowledgment by the Lessee in cl 16 of the 23 See above at [3]. 24 Quoted at [3] above. 25 Quoted at n 4 above. Kirby Crennan fundamental obligation imposed on it by cl 1326. Further, essentiality is not waived by the Lessor accepting arrears or late payment: cl 7.227. The duty of the Lessee to pay damages – loss of bargain damages – for breach of an essential term is the subject of a specific covenant in cll 7.3, 7.5, and 7.7, as well as cl 1628. The Lessor's entitlement to recover damages is not to be affected or limited by any of the events described in cl 7.629. Whether or not the mere description of a covenant in a lease as essential, however trivial it may be thought to be, can make it essential is a question which need not be decided. The duty to pay rent punctually is not in itself necessarily a trivial one, and this congeries of provisions reveals it as having the characteristic of essentiality in this Lease. As the appellant submitted, the Lease reveals a "preoccupation" with the issue, which is scarcely surprising in a commercial lease creating an economic relationship. Hence, if the issue is treated simply as one of construction, many clauses point overwhelmingly to the conclusion that on the true construction of the Lease the covenant to pay rent was an essential term. However, although this and other arguments of the Lessee treated the issue as one of pure construction, the Lessee's case was not based on pure construction. It was based on positive rules of law said to be inherent in the nature of a lease, or on various forms of repugnancy, which were said to lead to the conclusion that whatever the express terms of the lease say, they must either be ignored or be read down so as to preclude recovery of loss of bargain damages for a breach of a term which is not in truth essential unless the breach is a repudiation or a fundamental breach. On the Lessee's arguments, a contractual term that a particular provision was essential was thus to be read as an agreement that breach could justify termination, but not as an agreement that it would justify recovery of loss of bargain damages. Mischaracterisation of transactions. The Lessee supported its proposition that a covenant in a lease cannot be made essential merely by reason of the parties' agreement that it is by alluding to authorities holding, for example, that to 26 Clause 16 is quoted above at [3]. 27 See above at [3]. 28 See above at [3]. 29 See above at [3]. Kirby Crennan describe what would otherwise be a licence as a "lease", or vice versa, does not prevent the courts from going behind the label and assessing the true nature of the transaction30. Cases of that kind are often cases where the parties have attempted to gain the advantage of some statutory regime or other rule of law applying to one particular type of relationship by saying their relationship is of that type. There was no attempt of that kind here. There is no doubt what the legal relationship of the parties was; the only question is whether one term of that relationship was "essential". Interdependency of grant of possession and right to rent. The Lessee submitted that a lease imposed on the landlord the obligation to grant the tenant exclusive possession over the whole term, and that that obligation was interdependent with the tenant's obligation to pay rent over the whole term. If the landlord decided to terminate the lease for reasons other than repudiation or fundamental breach, the damage flowing from loss of bargain was not caused by the tenant's breach, but by the landlord's decision to terminate. So expressed, the argument was a causation argument. The Lessee supported the argument by reference to AMEV-UDC Finance Ltd v Austin31 and Esanda Finance Corporation Ltd v Plessnig32. It is true that in these cases there are passages that say in reference to chattel leases, as Gibbs CJ said in the AMEV-UDC case: "[I]t is the actual damage which flowed from the breach which alone can be recovered."33 And in the same case Mason and "The point is that when the lessor terminates pursuant to the contractual right given to him for breach by the lessee, the loss which he can recover for non-fundamental breach is limited to the loss which flows from the lessee's breach. The lessor cannot recover the loss which he sustains as a result of his termination because that loss is attributable to his act, not to the conduct of the lessee." 30 Radaich v Smith (1959) 101 CLR 209; [1959] HCA 45. 31 (1986) 162 CLR 170 at 174-176, 186 and 194; [1986] HCA 63. 32 (1989) 166 CLR 131 at 143-148. 33 (1986) 162 CLR 170 at 175. 34 (1986) 162 CLR 170 at 186. Kirby Crennan But that case, like Shevill's case, was a case where there was no fundamental breach, repudiation or breach of an essential term, and as Mason and Wilson JJ said in the passage immediately succeeding the last one quoted35: "It is otherwise in the case of fundamental breach, breach of an essential term or repudiation." They were distinguishing between termination pursuant to a contractual right to do so and termination on grounds of breach of condition (ie breach of an essential term). For the proposition last quoted, Mason and Wilson JJ cited what Mason J said in Progressive Mailing House Pty Ltd v Tabali Pty Ltd36. His Honour there said that loss of bargain damages could be recovered for repudiation or "fundamental breach". He defined "fundamental breach" to mean "breach of a condition or breach of another term or terms which is so serious that it goes to the root of the contract". The second sense of the term "fundamental breach" as used by Mason J corresponds with what this Court recently described as "a sufficiently serious breach of a non-essential term"37. Mason J said, contradicting the Lessee's submission, that it cannot be said in the case of repudiation or fundamental breach (as he defined it, including breach of a condition) that: "loss of the bargain is attributable to the innocent party's exercise of his contractual power to terminate. It is different in the case of termination for non-essential breach, as Shevill demonstrates, because, by terminating pursuant to the contract at that stage, the innocent party puts it beyond his power to insist on performance, thereby bringing to an end any possibility 35 (1986) 162 CLR 170 at 186. 36 (1985) 157 CLR 17 at 31; [1985] HCA 14. 37 Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd (2007) 82 ALJR 345 at 357 [49]; 241 ALR 88 at 102; [2007] HCA 61: the type of breach discussed by Diplock LJ in Hongkong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha [1962] 2 QB 26 at 69-70. Indeed this is a case to which Mason J in the Progressive Mailing case at 31 referred indirectly: he cited Lord Wilberforce in Federal Commerce & Navigation Co Ltd v Molena Alpha [1979] AC 757 at 779, and Lord Wilberforce cited the Hongkong Fir case at that point. Kirby Crennan of repudiation or fundamental breach with consequential damages for loss of bargain."38 The two passages quoted in the last paragraph from the reasons for judgment of Mason and Wilson JJ in the AMEV-UDC case were also quoted with approval by Brennan J in a passage relied on by the Lessee in Esanda Finance Corporation Ltd v Plessnig39. Mason and Wilson JJ also said in the AMEV-UDC case40 that: "in Shevill v Builders Licensing Board there were indications that, if the lease clearly provided that whenever a lessor exercised the right of re-entry conferred by the lease he was able to recover such loss as he may have suffered by reason of the premature termination of the lease, such a provision might be effective"41. The present case is one in which cll 7.2, 7.3, 12 and 16 do clearly provide for the outcome described in that passage. It is thus plain that the authorities relied on by the Lessee do not establish the point which the Lessee sought to make, and in fact contradict it. And in Shevill's case Gibbs CJ said42: "[I]t would require very clear words to bring about the result, which in some circumstances would be quite unjust, that whenever a lessor could exercise the right given by the clause to re-enter, he could also recover damages for the loss resulting from the failure of the lessee to carry out all the covenants of the lease". In this case there are very clear words, and, although the failure of the Lessee's commercial venture, caused partly by Woolworths' stark breach of its obligations, naturally attracts sympathy, there is no basis upon which a court 38 Progressive Mailing House Pty Ltd v Tabali Pty Ltd (1985) 157 CLR 17 at 31. 39 (1989) 166 CLR 131 at 145; [1989] HCA 7. 40 (1986) 162 CLR 170 at 194. 41 (1982) 149 CLR 620 at 629, 637. 42 (1982) 149 CLR 620 at 628. See also Wilson J at 637 ("requiring a clear expression of intention"). Kirby Crennan could properly do otherwise than to give effect to the obligations to which the parties had bound themselves. The Lessee's argument thus fails when considered as a causation argument. But the argument was also put in another form. The landlord, it was said, could not have it both ways: the landlord could not both regain possession and recover damages for unpaid future rent which would only have been received if possession had not been regained. But why not? It is not the case that the appellant in this case by its conduct in terminating and suing for loss of bargain damages put itself in a position better than it could have been in if it had kept the Lease on foot and sued from time to time for arrears of rent as they piled up. The appellant could not unjustly advantage itself in that way. Clause 7.8 echoed the general law in obliging the Lessor to take reasonable steps to mitigate loss. The Lessor could not have got both damages (namely, the present value of the unpaid rent from the time of termination until the expiry of the Lease) and in addition any rent capable of being earned by a re-letting of the Demised Premises. The Lessor was only entitled to obtain, as damages, the present value of any difference between the rent not paid by the Lessee and the rent received or to be received on re-letting. That is all that the trial judge allowed. To some extent the Lessee's argument rested on an idea of repugnancy – that there was a repugnancy between landlords having possession of property, but also being given a monetary equivalent for the rent they would have got had they not taken possession of the property and instead continued to allow it to be leased. But there is no true repugnancy. There can be no double recovery by landlords. If landlords obtain possession, they can only recover loss of bargain damages if they have tried unsuccessfully to obtain a new tenant at the rent stipulated in the terminated lease. The monetary equivalent of what they would have got if they had not taken possession of the property reflects the fact that they cannot obtain tenants, or cannot obtain tenants who promise to pay as much as the defaulting tenants promised. The group of submissions under consideration did not comprise submissions based on the words used in the Lease. In one version they involved a submission that some rule of law stopped the clear meaning of those words from being given effect. Thus the Lessee submitted: "[The parties] can agree on things but the question of what are the legal consequences of what they agree upon and what are the legal Kirby Crennan consequences of action taken in accordance with their agreement is something that is governed by the law, not by their particular intention." What proposition of law is referred to? This question was never answered. Save for any applicable statutory requirements or rules of law, there is no reason in law why general contractual principles do not apply to leases in this respect. Under general contractual principles, an innocent promisee can terminate the contract, and recover loss of bargain damages, where there is repudiation, or a fundamental breach, or a breach of condition – ie a breach of an essential term. And under these principles it is possible by express provision in the contract to make a term a condition, even if it would not be so in the absence of such a provision – not only in order to support a power to terminate the contract43, which the Lessee concedes, but also to support a power to recover loss of bargain damages44. No convincing reason was given to explain why the former outcome was sound in law but the latter was not. Relief against penalties and forfeiture. The Lessee's next argument appears to have been an argument of construction in the sense that it contended that the consequences of the appellant's construction were so extreme as to make the construction an impossible one. The Lessee submitted that equity would relieve against forfeiture where a party sought both to hold property as a result of breach of an obligation and to recover money in relation to that breach; and by parity of reasoning a lessor could not have both possession of leased premises after terminating a lease, and damages based on the assumption that the premises were leased. The Lessee relied on O'Dea v Allstates Leasing System (WA) Pty Ltd where Brennan J said that if, under an agreement for the hiring of a vehicle, the lessor re-took possession, that lessor was not able to obtain rent for the unexpired duration of the hiring period45: "[T]he lessees are entitled to relief against the exaction of so much of the entire rental as is attributable to that period so that the lessor shall not 43 Bettini v Gye (1876) 1 QBD 183 at 187; Hongkong Fir Shipping Co Ltd v Kawasaki Kisen Kaisha Ltd [1962] 2 QB 26 at 70; Financings Ltd v Baldock [1963] 2 QB 104 at 120. 44 Photo Production Ltd v Securicor Transport Ltd [1980] AC 827 at 849; Lombard North Central plc v Butterworth [1987] QB 527 at 535 and 545-546. 45 (1983) 152 CLR 359 at 393; [1983] HCA 3. Kirby Crennan recover or be entitled to retain both the whole of the entire rental and possession of the vehicle." This does not support the Lessee's argument, for reasons given by Brennan J set out earlier. He said46: "[A] stipulation which provides for the forfeiture on breach by the buyer or hirer of both the price and the consideration for which it is payable is in the nature of a penalty and equity will relieve against it. The foundation of the jurisdiction to relieve against forfeiture is that the stipulation for the forfeiture is really in the nature of a penalty." He said that the relevant clause in the case before him "is in the nature of a penalty, for the lessor who exacts the full measure of his entitlement under that clause receives more than the damages he would suffer by reason of many of the defaults which enliven that clause"47. In the present case in this Court the Lessee makes no claim that the Lease creates a penalty against which relief in the nature of relief against forfeiture should be given, although before the trial judge it contended unsuccessfully that cl 10.2(d) operated as a penalty. There were uncertainties in its position, but it seemed to be that if the appellant's contention that loss of bargain damages were recoverable is correct, that would operate as a penalty. The uncertainty rests in the fact that the Lessee said in argument, of the problems facing tenants: "The law of penalties comes very close to dealing with it but it does not deal with it fully and the law relating to forfeiture deals with these things, but not entirely." But, putting these uncertainties aside, if the contractual words clearly have one meaning, the consequence that in that meaning they create a penalty cannot cause them to be given another meaning. To make a contract containing a penalty has remedial consequences, but it is not contrary to the law. And even if the Lease, by reason of its stipulations for loss of bargain damages, operates as a penalty, relief against forfeiture on that ground would not be automatic. It would be a term of that relief that outstanding rent and outgoings be paid. The Lessee has not offered to do that, and indeed, by its cross-appeal, it actively resists that 46 (1983) 152 CLR 359 at 391. 47 (1983) 152 CLR 359 at 391. Kirby Crennan course, for, as was seen above48, it contends that it was not in breach of cl 10.2(c). Where a person in the position of the Lessee can cure the phenomena which are said to render the arrangement a penalty by obtaining relief against forfeiture provided it complies with the condition of that relief, but it refuses to do so, it cannot rely on the allegedly penal character of the lease to compel a construction antithetical to its clear words49. The authorities. The Lessee contended that its argument was supported by authority50. In fact none of the cases it cited supports the Lessee's argument. In none of them was the present point in issue51. Most of them contain dicta against 49 In particular cases other principles of the general law (for example those relating to unconscionable dealing) or of statutory law (for example the Trade Practices Act 1974 (Cth)) could be invoked. They were not invoked in this case. 50 It cited McDonald v Dennys Lascelles Ltd (1933) 48 CLR 457 at 477-478; [1933] HCA 25; Shevill v Builders Licensing Board (1982) 149 CLR 620 at 627-628, 629 and 636-638; [1982] HCA 47; O'Dea v Allstates Leasing System (WA) Pty Ltd (1983) 152 CLR 359 at 390, 391 and 393; [1983] HCA 3; Progressive Mailing House Pty Ltd v Tabali Pty Ltd (1985) 157 CLR 17 at 30, 31, 39-41, 46 and 55; [1985] HCA 14; AMEV-UDC Finance Ltd v Austin (1986) 162 CLR 170 at 174- 176, 186 and 194; [1986] HCA 63; Esanda Finance Corporation Ltd v Plessnig (1989) 166 CLR 131 at 143-148; [1989] HCA 7. 51 Thus, as Mason J said in Progressive Mailing House Pty Ltd v Tabali Pty Ltd (1985) 157 CLR 17 at 30, the Court in Shevill v Builders Licensing Board was not called upon to decide whether a lessor can sue to recover damages for loss of bargain when that lessor enters under a proviso for re-entry in consequence of the lessee's repudiation, fundamental breach or breach of an essential term. Kirby Crennan the Lessee52. None of them contain dicta supporting the Lessee53. In the end counsel for the Lessee conceded that his researches had revealed no case in point, and said that the present case was the first case raising the issue. Difficulties of principle in the Lessee's submission. There are other difficulties with the Lessee's contentions. One is that they entail a sharp distinction between actions for damages on termination for breach of an express term and actions for damages on termination for repudiation. It can be adventitious whether a defaulting tenant simply fails to pay rent or accompanies the failure by a statement of inability and unwillingness to do so. The need for a landlord to recover loss of bargain damages from a tenant only arises when the market is falling, for if the market is static or rising, the landlord can re-enter against the defaulting tenant, recover arrears of rent, and promptly install a new tenant at the same or a higher rent. The consequence of the Lessee's submission is that landlords are unable to protect themselves as satisfactorily in a falling market as distinct from one which is static or rising. It 52 Thus the distinction drawn by the Lessee between terminations for repudiation or for fundamental breach, and terminations for breach of terms described as "essential" was not drawn by Dixon J in McDonald v Dennys Lascelles Ltd (1933) 48 CLR 457 at 477, when he said: "[W]hen a contract ... is dissolved at the election of one party because the other has not observed an essential condition or has committed a breach going to its root, the contract is determined so far as it is executory only and the party in default is liable for damages for its breach." And other illustrations have been given above of authorities which contain statements contradicting the Lessee's submissions: see [52]-[53]. 53 Thus, for example, what Dixon J said in McDonald v Dennys Lascelles Ltd (1933) 48 CLR 457 at 477-478 is irrelevant: the case concerned the entitlement of a defaulting vendor of land to be repaid pre-payments upon termination of the sale contract. In Progressive Mailing House Pty Ltd v Tabali Pty Ltd (1985) 157 CLR 17 at 39-40 Brennan J said: "A lessor can recover damages for loss of the benefit of a lease only where the lessee has repudiated the lease before determination of the term." But it was his habit to use the word "repudiated" to refer to the commission of conduct which was a repudiation in the strict sense, a fundamental breach, or a breach of condition: Esanda Finance Corporation Ltd v Plessnig (1989) 166 CLR Kirby Crennan is difficult to see why landlords should bear the risks of a falling market rather than their defaulting tenants, particularly where, as the Lessor and the Lessee did in the Lease, the parties explicitly, in many places and in an integrated way, placed that risk on the tenant. It is also difficult to see why the law – whether the relevant rule which the Lessee was urging be a rule of construction or some rule of substantive law – should have the result of placing the risks of a falling market on landlords, and of depriving them of the opportunity by agreement to allocate the risk otherwise. The effect of the Lessee's submission is to cut down on party autonomy, to increase the chance of disputes and to reduce certainty. If the Lessee is wrong, it is open to parties to agree that a particular term is essential, and to agree on the consequences of breach. That avoids arguments about whether the term in question is or is not essential independently of the parties' agreement that it is, and what the consequences of breach of it are. If the Lessee is correct, these dangers increase. Conclusion. For these reasons the Lessee has not made good its submission that the Lease does not permit the appellant to sue for loss of bargain damages. The answer to question (c) is "Yes". If yes to (c), did s 117 of the Conveyancing Act entitle the appellant to recover loss of bargain damages for breach of cl 3? The appellant was not in contractual relations with the Lessee. It contended that it was entitled to recover against the Lessee for loss of bargain damages by recourse to the Conveyancing Act. Section 117 relevantly provides: "(1) Rent reserved by a lease and the benefit of every covenant or provision therein contained having reference to the subject-matter thereof and on the lessee's part to be observed or performed, and every condition of re-entry and other condition therein contained shall be annexed and incident to, and shall go with the reversionary estate in the land or in any part thereof immediately expectant on the term granted by the lease, notwithstanding severance of that reversionary estate, and shall be capable of being recovered, received, enforced, and taken advantage of by the person from time to time entitled, subject to the term, to the income of the whole or any part as the case may require of the land leased." By s 116, s 117 applies to leases of land held under the Real Property Act. The expression "having reference to the subject-matter thereof" is equivalent to "touching and concerning the land" – a necessary condition for a covenant to be one "which runs with the land". Kirby Crennan The appellant's first argument on s 117. The appellant's submissions started with the propositions, conformably with the conclusions so far reached in relation to questions (a)-(c), that the breach of cl 10.2(c) of the 1999 Deed was a breach of the covenant to pay rent in cl 3 of the Lease, and that that covenant was an essential term. The first submission of the appellant concentrated on the first 21 words of s 117. The submission was that cl 3 was a covenant in a lease having reference to the subject-matter of the lease. That covenant gave a primary right to sue for rent if it was not paid at the due time. But, since cl 3 was an essential term, it also gave a right to terminate the lease, and that carried a secondary right to sue for loss of bargain damages. The benefit of all these rights was annexed and incident to, and liable to go with, the reversionary estate. In 1963 the English equivalent to s 117 was s 141 of the Law of Property Act 1925 (UK). The appellant pointed to Diplock LJ's statement in In re King, decd54, a case on s 141, that the benefit of a covenant by a lessee to keep premises in repair or reinstate them after fire is "the right to enforce the covenant by exercising such remedies for its breach as are expressly provided by the lease, for example, by forfeiture or entry to execute the repairs and recover their cost, or as are available at common law, namely, by suing for damages for breach". The appellant submitted that the right to sue for loss of bargain damages on termination of a lease was a common law right falling within the concluding words of that quotation. The appellant also referred to the following words of "The measure of damages for breach of a covenant in a lease which runs with the land ... is the diminution in the value of the reversion consequent upon the breach and is sustained by the person entitled to the reversion." In that form, the appellant's submissions did not depend on the existence of any express covenant to pay loss of bargain damages. But the appellant also submitted that s 117 applied to the express covenants to do so in cll 7.3, 7.4, 7.5, 7.7 and 16 of the Lease, and that those clauses satisfied the tests for "touching and concerning land" stated by Lord Oliver of Aylmerton in P & A Swift Investments (A Firm) v Combined English Stores Group plc56. 54 [1963] Ch 459 at 496-497. 55 [1963] Ch 459 at 497. 56 [1989] AC 632 at 642: the tests are quoted at [74] below. Kirby Crennan The Lessee's preliminary points. The Lessee contended that there was no authority for the proposition that the right to recover loss of bargain damages for breach of a covenant to pay rent which was an essential term would pass with the reversion by virtue of the operation of s 117 alone. Equally, however, the Lessee did not refer to any authorities against it. The Lessee also stressed that in the absence of privity of contract between the appellant and the Lessee, no action for loss of bargain damages would lie at common law. But, however that may be, it leaves open the question of whether a statutory provision like s 117 alters that outcome. Beyond those arguments the Lessee made four primary submissions. Difficulty of assessing loss of bargain damages. The first submission was put thus: "Where no privity of contract governs an entitlement to relief it is more difficult than otherwise to assess damages by reference to what was, or was not, within the contemplation of the original contracting parties, one or both of whom no longer has an interest in the property the subject of the 'contract' and might not be party to proceedings before the court." In some circumstances it may be more difficult, but there is no such difficulty in the case of loss of bargain damages after termination for breach of an essential term in the form of a covenant to pay rent: the court simply compares the rent payable under the lease with that recovered or to be recovered from any new lease, discounting to obtain present value. In any event, the existence of difficulty in some circumstances could not compel a different construction of s 117 if the words were clear. Right to loss of bargain damages does not touch and concern the land. The second submission was that a right to loss of bargain damages did not "run with the land" because it did not have "reference to the subject-matter" of the lease – it did not touch and concern the land. The Lessee referred to the test stated in Rogers v Hosegood57: "[T]he covenant must either affect the land as regards mode of occupation, or it must be such as per se, and not merely from collateral circumstances, affects the value of the land." 57 [1900] 2 Ch 388 at 395 per Farwell J. Kirby Crennan The Lessee submitted that an entitlement to loss of bargain damages is an entitlement which arises, if at all, upon termination of a contract between particular parties privy to the contract; that it is a personal right which does not satisfy either limb of the Rogers v Hosegood test; that it does not affect the landlord and tenant in their capacities as such; and that it is an entitlement to compensation based not upon a covenant but upon a secondary obligation imposed by law. It submitted that a legal obligation designed to secure performance of some other obligation which touches and concerns land does not necessarily take on from that relationship the same characteristics as regards transmissibility to or against successors in title. Those arguments must be rejected. As the Lessee correctly conceded, a covenant to pay rent touches and concerns demised land58. It would be a strange result if the rights to enforce that covenant did not also touch and concern the land, whether they be rights to sue for arrears, to re-enter and terminate the lease, or to sue for loss of bargain damages. Application of the general tests as to whether or not a covenant touches and concerns the land indicates that that strange result does not follow in this case. In P & A Swift Investments (A Firm) v Combined English Stores Group plc, Lord Oliver of Aylmerton said that the relevant matters for consideration were these59: "(1) the covenant benefits only the reversioner for time being, and if separated from the reversion ceases to be of benefit to the covenantee; (2) the covenant affects the nature, quality, mode of user or value of the land of the reversioner; (3) the covenant is not expressed to be personal (that is to say neither being given only to a specific reversioner nor in respect of the obligations only of a specific tenant); (4) the fact that a covenant is to pay a sum of money will not prevent it from touching and concerning the land so long as the three foregoing conditions are satisfied 58 McPherson JA said in Simmons v Lee [1998] 2 Qd R 671 at 675: "There is, of course, no doubt that a tenant's covenant to pay rent under a lease touches and concerns the land leased. That has long been the law: Parker v Webb (1700) 3 Salk 5 [91 ER 656]. Indeed, if a covenant to pay rent does not run with the land, it is difficult to imagine a covenant that does. Rent, in the language of the old books, issues out of the land and is incident to the reversion: see Co Litt 142a, 143a." See also Auscott Ltd v Panizza [1988] NSW Conv R ¶ 55-395. 59 [1989] AC 632 at 642. Kirby Crennan and the covenant is connected with something to be done on, to or in relation to the land." The Lessee did not dispute the correctness of these tests, which have been much Applying these tests to the Lease in turn, first, the covenants in cl 3 benefit the reversioner for the time being only, and if separated from the reversion they cease to be of benefit to the covenantee. This is because in cl 1.1 the term "Lessor" is defined as meaning "the Lessor its successors and assigns", and in cl 1.2 the term "Lessee" is defined as meaning "the Lessee and the executors administrators successors and permitted assigns of the Lessee". Further, the covenant in cl 3.1 to pay rent opens: "The Lessee covenants for himself, his heirs, executors administrators and assigns with the Lessor to pay unto the Lessor, his executors, his administrators or assigns ..." Secondly, while the covenant does not affect the nature, quality or mode of user of the reversioner's land, it does affect its value. If Diplock LJ was correct to say that the measure of damages for breach of a covenant which runs with the land is "the diminution in the value of the reversion consequent upon the breach"61, which with respect he was, breach of a covenant to pay rent which is an essential term can diminish the value of the reversion. However, a seller of Blackacre at a time when a tenant of Blackacre is not in breach of any covenant to pay rent should obtain the same price, as reflecting the value of the land, as the seller would if the tenant committed a breach of that covenant just before sale, but the seller had the right to sue for loss of bargain damages, and assigned that right. Leaving aside questions of opportunity cost and of the tenant's solvency, the recovery of damages will overcome the diminution in the value of the reversion; if there were no right to recover damages, there would be diminution in the value of the reversion. But if there were no assignment, and if the right to sue for loss of bargain damages were held not to touch and concern the land, so that the transferee of the reversion could not sue under s 117, the diminution in the value of the land, whether it takes place just before completion or earlier, will be uncompensated. That there is a diminution in value of the land if the covenant is not enforceable by a transferee of the freehold supports the conclusion that a covenant to pay rent which is an essential term is in truth a covenant which affects the value of the land. Thus Lord Oliver's second test is satisfied. 60 See cases cited in n 65. 61 See above at [69]. Kirby Crennan Thirdly, because of the terms of cll 1.1, 1.2 and 3.1, the covenant is not expressed to be personal: it is not given only to a specific reversioner, nor in respect of the obligations of a specific tenant62. Fourthly, although the covenant in relation to which the right to sue for loss of bargain damages arises is a covenant to pay sums of money, and although it is not connected with anything to be done with or to the land, those factors do not prevent it from touching and concerning the land, because the first three conditions are satisfied and the covenant is connected with something to be done in relation to the land. Section 117 directed only to continuance of Lease? The Lessee's third submission was that the right to loss of bargain damages arose by operation of law on the termination of a contract. "Section 117 does not carry with it a right to loss of bargain damages that arises at the end of the lease because it is directed towards the continuance of the lease." However, there is nothing in the language of s 117 which limits the "benefit of every covenant" in a lease only to those benefits which arise during the continuance of the lease. Exclusion of s 117 by Special Condition 50. The Lessee's fourth submission was that even if s 117 were capable of enabling the transferee of a reversion to claim loss of bargain damages on termination of a lease, Special Condition 50 of the Sale Contract excluded s 117. Special Condition 50 provided: "(a) The Purchaser acknowledges that under [the 1999 Deed] the Vendor may become entitled to payments properly attributable to the period prior to completion. (b) The Vendor shall upon the request of the Purchaser, or the registered proprietor of the Property from time to time cause to be executed all documents the Purchaser or registered proprietor, as the case may be, reasonably requests it to sign and which it is empowered to sign under ... clause 4 of the [1999] Deed. 62 See at [75] above. Kirby Crennan (c) The Purchaser takes the Property subject to the [1999] Deed and the Purchaser shall indemnify the Vendor against any breach of that deed by (d) This Further Condition 50 shall not merge on completion." The Lessee submitted that implicit in this and other provisions of the sale contract was an agreement between the Lessor and the Lessee that s 117 "did not operate as an assignment of [the Lessor's] rights and obligations under the 1999 Deed, reinforcing the character of that Deed as a side agreement in respect of which rights and obligations under clause 10.2 did not run with the land". However, the question is not whether cl 10.2 considered in isolation ran with the land. The significance of the Lessee's breach of cl 10.2(c) of the 1999 Deed was that it was also a breach of cl 3 of the Lease, and the question is whether cl 3, and the right to sue for loss of bargain damages on termination for breach of it, ran with the land under s 117. The Lessee submitted that Special Condition 50 "reserves rights to" the Lessor. The only right it reserves is the right to money payable under the 1999 Deed before completion. It leaves untouched all rights to money payable after completion of the Sale Agreement. And it also leaves untouched all rights to loss of bargain damages in the event that the appellant chose to terminate the Lease after completion. Special Condition 50 is not inconsistent with the operation of s 117. For the above reasons the appellant's first submission on the application of s 117 is to be accepted. The appellant's other arguments. In view of the appellant's success on its first s 117 argument, it is unnecessary to consider a second one; nor to consider arguments which relied on ss 40(3), 51 and 52 of the Real Property Act. Hence the answer to question (d) is "Yes". If no to (d), was there an assignment by the Lessor to the appellant of the benefit of all the covenants in the Lease and the 1999 Deed by (i) the Sale Contract or (ii) the Deed of Assignment? In view of the answer to (d), this question does not arise. Kirby Crennan If no to (d) and (e), was the Lessee estopped from denying that the appellant could take advantage of the Lease and the 1999 Deed? In view of the answers to questions (d) and (e), this question does not arise. If the appellant were entitled to recover loss of bargain damages, was the quantum to be limited by assuming that the Lessee complied with cl 10 of the 1999 Deed? The Lessee submitted that if, contrary to those of its contentions which were rejected in relation to questions (a)-(d), the appellant was entitled to loss of bargain damages, the trial judge assessed them on the wrong basis. It submitted that the correct basis for calculating what the appellant lost in the period between the termination of the Lease and 29 March 2008 was to start with the rent and outgoings payable under cl 10.2 of the 1999 Deed, not the rent and outgoings payable under cll 3-5 of the Lease. This submission was supported by reference to what is sometimes called the "Mihalis Angelos principle"63. However, neither in writing nor orally did the Lessee explain why the submission should be accepted. The Mihalis Angelos principle has nothing to do with the present case. The principle is that where a contract-breaker has a choice of methods of performance, damages will be assessed on the basis of the contract-breaker's minimum legal obligation – the method which would have been least onerous to the contract-breaker in the sense that non-compliance with it attracts the lowest measure of damages. The Lessee's problem here is that it did not have a choice of methods of performance. Once the Lessee contravened cl 10.2(c) of the 1999 Deed, it was obliged to pay the cl 10.2(d) amount, and it was in breach of cl 3 of the Lease. The Lessee had only one method by which to perform the obligation created by cl 3 of the Lease as amended by cl 10.2 of the 1999 Deed: to pay as cl 10.2(a)-(c) required, and to avoid any continuing Scheduled Breach of the Lease or breach of the 1999 Deed before 29 March 2008. If it failed to avoid either of those types of breach, cl 10.2(d) came into play, and, more importantly, cl 3 was breached. Paying the sums listed in cl 10.2(a)-(c) was not an alternative method of performance to paying the sum listed in cl 10.2(d) as well; the duty to pay the latter was simply a remedial consequence of failing to avoid the relevant breaches, and breach of cl 10.2(c) was a breach of the 1999 Deed. 63 Maredelanto Compania Naviera SA v Bergbau-Handel GmbH; The Mihalis Angelos [1971] 1 QB 164. See also TCN Channel 9 Pty Ltd v Hayden Enterprises Pty Ltd (1989) 16 NSWLR 130 at 150-156. Kirby Crennan (h) Were the second and third respondents liable on the Guarantees for the whole of the judgment against the Lessee? The liability of the guarantors is an issue raised in the Lessee's Notice of Cross-Appeal. Since s 117 of the Conveyancing Act deals only with covenants, provisions and conditions in a lease to be observed or performed by a lessee, it cannot apply to a covenant in a guarantee given by a third party guaranteeing performance of the lessee's obligation to pay rent. Hence the appellant relied on, and the Court of Appeal applied, a common law doctrine stated in 158364, after the precursor to s 117, the Grantees of Reversions Act 32 Hen VIII c 34, had been enacted in 1540. The Court of Appeal held that cl 2 of the Guarantees applied to the monies owing under cl 10.2(c) and (d) of the 1999 Deed (a total of $362,232 as at 28 March 2006). It held, reversing the trial judge, that there was no variation of the Lease which so altered the obligations of the second and third respondents without their consent as to discharge the Guarantees. It also held that their covenants touched and concerned the land, and were enforceable by the appellant as assignee of the reversion without express assignment. This last conclusion was challenged in the Notice of Cross-Appeal. The second and third respondents, however, took no other point: it was accepted that if that point failed, they were liable for the totality of the judgment against the Lessee. The Court of Appeal's reasoning. The Court of Appeal held that where the covenant of a guarantor to guarantee payment of rent by a lessee touched and concerned the land, it ran with the land, and could be enforced by a transferee of the reversion. It followed its own decision to that effect in Ryde Joinery Pty Ltd v Zisti65. 64 Spencer's Case (1583) 5 Co Rep 16a [77 ER 72]. 65 (1997) 7 BPR 15,233 at 15,237-15,238. That case followed several like English and Australian authorities: Kumar v Dunning [1989] QB 193; P & A Swift Investments (A Firm) v Combined English Stores Group plc [1989] AC 632; Lang v Asemo Pty Ltd [1989] VR 773; Showa Shoji Australia Pty Ltd v Oceanic Life Ltd (1994) 34 NSWLR 548. See also Coronation Street Industrial Properties Ltd v Ingall Industries plc [1989] 1 WLR 304; [1989] 1 All ER 979 and Simmons v Lee [1998] 2 Qd R 671. Kirby Crennan Submissions of the second and third respondents. The second and third respondents put only two submissions66. The first was that this Court should not follow the House of Lords decision in P & A Swift Investments (A Firm) v Combined English Stores Group plc67 but "prefer the reasoning underlying [Consolidated Trust Co Ltd v] Naylor that a surety's covenant, being a collateral obligation not affecting land, does not The second submission is that Swift's case was distinguishable "as a case concerned only with 'arrears of rent', not a claim to loss of bargain damages arising ... on a secondary legal obligation imposed by law ... upon termination of a lease for breach". Can a guarantor's covenant run with demised land? It is to be noted that the second and third respondents did not attack Lord Oliver of Aylmerton's statement in Swift's case of the tests to determine whether a covenant runs with the land69. They only attacked the conclusion reached by the House of Lords that those tests were satisfied by the obligation of the guarantor in that case. Those tests are satisfied in this case. As to the first test, the relevant covenant in cl 2, read with Recital B and cl 1(f) of the Guarantees70, benefits only the reversioner for the time being. That is because the Guarantees are guarantees to the "Lessor". The expression 66 In oral address only the second and third respondents put an argument which was outside the Notice of Cross-Appeal to the effect that on their true construction the Guarantees did not apply to a liability to pay loss of bargain damages. The Court of Appeal said this argument was not put to it. There being no application to amend the Notice of Cross-Appeal with a view to seeking special leave in relation to the new ground, that argument, which the appellant had no effective opportunity to answer, need not be dealt with, beyond saying that it is plainly wrong for the reasons given by the trial judge. 68 Naylor's case is reported at (1936) 55 CLR 423; [1936] HCA 33. 69 [1989] AC 632 at 642, quoted above at [74]. 70 Quoted above at [4]. Kirby Crennan "Lessor" is defined as meaning the "First Lessor" while the First Lessor holds the freehold, and thereafter means whoever is the owner of the freehold. Hence after the "First Lessor" (ie the Lessor under the Lease) sold to the appellant, it lost all benefits under the Guarantees (save for rights accrued before the change of ownership). Thus the covenant benefits only the reversioner for the time being, and once separated from the reversion it ceased to be of benefit to the covenantee (save for accrued rights). As to the second test, the covenant affects the value of the reversioner's land: where land is sold subject to a subsisting tenancy, a guarantee of the tenant's rental obligations will commonly enhance the value of the land. As to the third test, by reason of Recital B and cl 1(f) of the Guarantees, the covenant is not expressed to be personal to a specific reversioner and by reason of cl 1(g) it is not expressed to be personal to a specific tenant. The fourth test is satisfied. The fact that the covenant is to pay a sum of money will not prevent it from touching and concerning the land, since the first three conditions are satisfied and the covenant is connected with something to be done in relation to the land, namely the payment of rent for its occupation. There is a more direct route to the conclusion that the Guarantees touch and concern the land71: "A covenant by a surety that a tenant's covenant which touches and concerns the land shall be performed and observed must itself be a covenant which touches and concerns the land". With respect, that is correct. As McPherson JA has said: "If rent runs with the land, it is not a long step to say that a guarantee of that rent also does so."72 Accordingly, contrary to the submissions of the second and third respondents, the covenants in the Guarantees cannot be regarded as collateral obligations not affecting land, and they run with the land. 71 P & A Swift Investments (A Firm) v Combined English Stores Group plc [1989] AC 632 at 637 per Lord Templeman (Lords Keith of Kinkel, Roskill and Ackner concurring). 72 Simmons v Lee [1998] 2 Qd R 671 at 675. Kirby Crennan So far as the submissions of the second and third respondents suggested that there was a contradiction between Consolidated Trust Co Ltd v Naylor73 and P & A Swift Investments (A Firm) v Combined English Stores Group plc74, that suggestion is to be rejected. Naylor's case concerned the assignment of a mortgage. It was held that the assignment did not transfer the benefit of a covenant by a guarantor that the borrower would repay the principal debt, on the ground that neither the borrower's covenant to repay the principal, nor the guarantor's covenant to pay if the borrower did not, could touch and concern the land. At least the second of Lord Oliver's tests, even if removed from the context of leases and modified so as to relate to mortgages, would not be satisfied in relation to the borrower's covenant. The value of the mortgaged land, and of the mortgagee's interest in it, is not affected by the covenant or its absence: the land as a whole would fetch the same price whether or not the guarantee covenant exists, and the mortgagee's interest in the land will fetch the same price, for the value of that interest depends on what can be realised when the land is sold pursuant to the mortgagee's power of sale, or on foreclosure. In Kumar v Dunning the English Court of Appeal distinguished Naylor's case on a more general basis75: "A surety for a mortgage debt is a surety for the payment of the principal debt. The borrower's own covenant to pay the principal has nothing to do with the land and cannot touch and concern the land: there is, therefore, no reason why a covenant by way of surety for such a payment should touch and concern the land. It is quite different from a surety for the performance of a tenant's covenant which does touch and concern the land: such a surety covenant is necessarily and inextricably bound up with the tenant's obligations." That reasoning, while it is with respect correct, has to be placed in the Torrens system context in which Naylor's case was decided. The case concerned the transfer of a mortgage over Torrens system land. That was a dealing in the land, and the Real Property Act, which Dixon and Evatt JJ described as "a statute ... 73 (1936) 55 CLR 423. 75 [1989] QB 193 at 206-207. Kirby Crennan concerned with dealings in land"76, therefore applied to it, and prescribed how mortgages might be transferred and with what consequences. Section 51 provided: "Upon the registration of any transfer, the estate or interest of the transferor as set forth in such instrument, with all rights, powers and privileges thereto belonging or appertaining, shall pass to the transferee, and such transferee shall thereupon become subject to and liable for all and every the same requirements and liabilities to which he would have been subject and liable if named in such instrument originally as mortgagee, encumbrancee, or lessee, of such land, estate, or interest." Section 52(1) provided: "By virtue of every such transfer, the right to sue upon any memorandum of mortgage or other instrument and to recover any debt, sum of money, annuity, or damages thereunder (notwithstanding the same may be deemed or held to constitute a chose in action), and all interest in any such debt, sum of money, annuity, or damages shall be transferred so as to vest the same at law as well as in equity in the transferee thereof." Dixon and Evatt JJ said that the Act77: "is concerned with the mortgage transaction in its entirety as it affects the land, and, therefore, extends to the personal liability of the mortgagor for the mortgage debt because that liability is intimately connected with the rights of property arising out of the mortgage transaction. A surety's obligation stands in a different relation to the dealing. His liability is introduced by way of additional security. It is personal and, except as a result of subrogation, does not directly or indirectly affect the land ... A guarantee is thus collateral to the mortgage transaction." McPherson JA has expanded the reasoning of Dixon and Evatt JJ as follows78: 76 Consolidated Trust Co Ltd v Naylor (1936) 55 CLR 423 at 434. 77 Consolidated Trust Co Ltd v Naylor (1936) 55 CLR 423 at 434-435. 78 Simmons v Lee [1998] 2 Qd R 671 at 675-676. Kirby Crennan "[T]he underlying distinction between a guarantee of a mortgage debt and a guarantee of rent under a lease is ... that, although the mortgage debt is, as Dixon and Evatt JJ said ... 'intimately connected with a right of property arising out of the mortgage transaction', it is the debt which, in the case of a mortgage, is considered 'the principal thing', while the mortgagee's interest in the land is regarded as 'accessory only'. [In] Haque v Haque [No 2]79 ... Kitto J described that conception of a mortgage as an 'ingrained principle' which had been 'absolutely settled and determined centuries ago'. Unlike rent, a mortgage debt is not something that issues out of, or is an incident of, the mortgagee's interest in the land; and a guarantee of such a debt cannot in that particular be in a stronger position than the debt itself." In short, Naylor's case is distinguishable. It is not correct to say, as the second and third respondents submitted, that the "reasoning underlying" Naylor's case corresponded with its argument in this Court. The only Australian case reaching a conclusion adverse to the proposition that guarantees of a lessee's covenant to pay rent pass with the reversion is Sacher Investments Pty Ltd v Forma Stereo Consultants Pty Ltd80. It is not in truth an authority adverse to the appellant. The reasoning turned on the non- application of s 117 of the Conveyancing Act. As has often been pointed out81, no argument appears to have been advanced in that case that the guarantor's covenant could be enforced on the basis that it touched and concerned the land. For those reasons the first argument advanced by the second and third respondents must be rejected. Is Swift's case distinguishable as being only concerned with arrears or rent, not loss of bargain damages? Contrary to the second and third respondents' submissions, Swift's case is not capable of being distinguished as being concerned only with a guarantee in relation to arrears of rent, and as having nothing to do with loss of bargain damages arising on termination of a lease. The tests stated by the House of Lords go to the question whether a covenant touches 79 (1965) 114 CLR 98 at 127; [1965] HCA 38. 80 [1976] 1 NSWLR 5. 81 Kumar v Dunning [1989] QB 193 at 207; Lang v Asemo Pty Ltd [1989] VR 773 at 775-776; Ryde Joinery Pty Ltd v Zisti (1997) 7 BPR 15,233 at 15,237. Kirby Crennan and concerns the land so as to entitle a transferee of the reversion to the benefit of the guarantee covenant. There is no reason why this Court should not apply the principle stated by the House of Lords in this respect as part of the law of Australia. There is every reason why their Lordships' exposition of the applicable law should be accepted as part of the law of this country. Once it is concluded that those tests are satisfied, the question of whether the benefit of the guarantee covenant is limited to arrears of rent or extends to loss of bargain damages depends on what its scope is. As a matter of construction, the scope of cl 2 of the Guarantees in this case extends to loss of bargain damages. Orders Despite the ingenuity of the Lessee's arguments and the skill with which they were advanced, the decisive questions must be answered adversely to the Lessee. In the end the problems for the respondents derived from the language of the Lease, as varied, and the Guarantees. From their point of view this language was not propitious. Adhering to the obligations which the parties accept in writing is a purpose of the law to which this Court must give effect. In view of the answer to question (a), the Lessee's challenge to the Court of Appeal's judgment sum against the Lessee fails. In view of the answer to questions (b) and (c), the figure for reinstatement damages should be added to that judgment sum. In view of the answer to questions (b)-(d) and (g), the figure for loss of bargain damages should be added as well, with the result that the appellant's claim that the trial judge's judgment should be substituted for that of the Court of Appeal succeeds. In view of the answer to question (h), the second and third respondents are liable to judgment in the same amount. It follows that the respondents should bear the appellant's costs, both in this Court and the courts below. Since the second and third respondents were ordered by the Court of Appeal to pay the costs of the appellant at trial and in the Court of Appeal, it is unnecessary to alter these orders, and sufficient to order that they pay the appellant's costs in this Court. The following orders should therefore be made. Appeal allowed. Special leave to cross-appeal granted; cross-appeal dismissed. Set aside the judgment for the appellant against the first respondent in the amount of $362,232 and in its place restore the judgment, given by the Kirby Crennan trial judge, for the appellant against the first respondent in the amount of $2,096,514 plus interest on that sum from 28 March 2006 calculated in accordance with s 101 of the Civil Procedure Act 2005 (NSW). Set aside the order relating to costs between the appellant and the first respondent, and in its place order that the first respondent pay the appellant's costs of the proceedings before the trial judge, of the appeal before the New South Wales Court of Appeal and of the appeal and cross- appeal to this Court. Set aside the judgment for the appellant against the second and third respondents in the amount of $362,232 and in its place give judgment for the appellant against the second and third respondents in the amount of $2,096,514, plus interest on that sum from 28 March 2006 calculated in accordance with s 101 of the Civil Procedure Act 2005 (NSW). Order that the second and third respondents pay the appellant's costs of the appeal and cross-appeal to this Court.

HIGH COURT OF AUSTRALIA CGU INSURANCE LIMITED APPELLANT AND ROSS BLAKELEY, MICHAEL RYAN & QUENTIN OLDE AS JOINT AND SEVERAL LIQUIDATORS OF AKRON ROADS PTY LTD (IN LIQUIDATION) & ORS RESPONDENTS CGU Insurance Limited v Blakeley [2016] HCA 2 11 February 2016 ORDER Appeal dismissed with costs. On appeal from the Supreme Court of Victoria Representation D J O'Callaghan QC with R L Enbom for the appellant (instructed by Norton Rose Fulbright Australia) P D Crutchfield QC with O Bigos for the first and second respondents (instructed by King & Wood Mallesons) No appearance for the third to sixth respondents Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS CGU Insurance Limited v Blakeley Procedure – Joinder of third parties – Where liquidators of company brought action in Supreme Court of Victoria against company directors for order under s 588M(2) of Corporations Act 2001 (Cth) – Where liquidators sought to join third party insurer after directors' claim for professional indemnity rejected – Where directors not in position to challenge denial of liability under contract of insurance – Whether Supreme Court had jurisdiction to join third party insurer and grant declaratory relief in relation to private insurance contract between directors and third party insurer. Jurisdiction – Federal jurisdiction – Meaning of matter – Meaning of justiciable controversy. Words and phrases – "declaratory relief", "federal jurisdiction", "joinder", "justiciable controversy", "matter", "privity", "real interest". Constitution, s 76(ii). Bankruptcy Act 1966 (Cth), s 117. Corporations Act 2001 (Cth), ss 562, 588G, 588M(2). Judiciary Act 1903 (Cth), ss 39(2), 79. Supreme Court Act 1986 (Vic), s 36. Supreme Court (General Civil Procedure) Rules 2005 (Vic), r 9.06. FRENCH CJ, KIEFEL, BELL AND KEANE JJ. Introduction The question on this appeal is whether federal jurisdiction invested in the Supreme Court of Victoria authorises that Court to entertain a claim for a declaration, by a plaintiff against a defendant's insurer, that the insurer is liable to indemnify the defendant. On 9 April 2013, the liquidators of Akron Roads Pty Ltd (In Liq) ("Akron") commenced proceedings in the Supreme Court against three former directors of the company including Mr Trevor Crewe. Also named as a defendant was Crewe Sharp Pty Ltd (In Liq) ("Crewe Sharp"), a company of which Mr Crewe was a director and which provided consultancy services to Akron. The liquidators allege that Crewe Sharp was a director of Akron within the extended meaning of "director" in s 9 of the Corporations Act 2001 (Cth) ("the Act")1. The liquidators sought an order under s 588M(2) of the Act that the directors and Crewe Sharp pay to them, as a debt due to Akron, an amount equal to the amount of loss or damage suffered by creditors of Akron in relation to debts owed by Akron because of its insolvency. The cause of action created by s 588M is enlivened by a breach on the part of a company director of the duties imposed by s 588G of the Act to prevent the company incurring debts when it is insolvent or if it would become insolvent by incurring the debts and where there are reasonable grounds for suspecting that the company is or would become insolvent. The liquidators alleged that Mr Crewe and Crewe Sharp breached that duty by failing to prevent Akron from incurring debts when it was insolvent. On 4 December 2013, Crewe Sharp made a claim on a professional indemnity policy with the appellant, CGU Insurance Ltd ("CGU"), for indemnity in relation to the claim brought against it by the liquidators. Mr Crewe, as a director of Crewe Sharp, was also insured under that policy. CGU sent a letter to Crewe Sharp on 6 March 2014 denying that the insurance policy covered the liability asserted by the liquidators. CGU said that the claims against Crewe Sharp and Mr Crewe were expressly formulated as 1 Paragraph (b) of the definition provides that "director" includes a person who is not validly appointed as a director if they act in the position of a director or if the directors of the company or body are accustomed to act in accordance with the person's instructions or wishes. Bell arising from breaches of their duties as directors. It cited an exclusion in the policy for the liability of directors or officers of an incorporated body "arising from any act, error or omission of a director or officer of that incorporated body while acting in that capacity." It also relied upon an exclusion of claims "[a]rising from a liability to pay trading debts, trade debts, or the repayment of any loan." On 20 June 2014, Crewe Sharp entered into a creditors' voluntary liquidation and its liquidators informed Akron's liquidators that it was unlikely that the company would defend the proceeding against it. As at 31 July 2011, Mr Crewe's net assets were about $1 million. Mr Crewe is not a bankrupt but the undisputed evidence is that his limited assets would be insufficient to cover the claim brought against him by the Akron liquidators in this proceeding. On 20 August 2014, Akron's liquidators filed an interlocutory process in the proceedings in the Supreme Court seeking an order that CGU be joined as a defendant and for leave to file and serve amended points of claim seeking a declaration that CGU was liable to indemnify Mr Crewe and Crewe Sharp under the insurance policy in respect of any judgment and costs order obtained by the Akron liquidators against them. On 2 October 2014, Mr Crewe's solicitors informed the Akron liquidators that he consented to the joinder of CGU and that he disagreed with CGU's decision to deny indemnity to Crewe Sharp. The liquidators of Crewe Sharp informed the Akron liquidators that Crewe Sharp was unfunded, was not in a position to investigate CGU's denial of indemnity, and took no position in relation to the joinder application. The other defendant directors did not participate in the application. On 13 February 2015, Judd J made the orders sought by the Akron liquidators2. CGU made an application for leave to appeal against those orders. That application was heard by the Court of Appeal on 15 June 2015 and on 19 June 2015 that Court ordered that the application for leave to appeal be granted but that the appeal be dismissed3. On 11 September 2015, this Court granted CGU special leave to appeal against the judgment and order of the Court of Appeal on the grounds that the Supreme Court lacked jurisdiction to entertain the claim by the Akron liquidators for declaratory relief against CGU4. For the 2 Akron Roads Pty Ltd (in liq) v Crewe Sharp [2015] VSC 34. 3 CGU Insurance Ltd v Blakeley (2015) 18 ANZ Insurance Cases ¶62-073. [2015] HCATrans 232 (Kiefel and Gordon JJ). Bell reasons that follow, the Supreme Court had federal jurisdiction which authorised it to entertain the claim and had the power to grant the relief sought. The statutory framework Sections 588G and 588M of the Act, which create the duties, and the remedies for their breach, underpinning the Akron liquidators' action against the former directors, have been sufficiently described. The liquidators relied upon s 562 of the Act as a sufficient basis for the joinder of CGU5. That section provides: "(1) Where a company is, under a contract of insurance (not being a contract of reinsurance) entered into before the relevant date, insured against liability to third parties, then, if such a liability is incurred by the company (whether before or after the relevant date) and an amount in respect of that liability has been or is received by the company or the liquidator from the insurer, the amount must, after deducting any expenses of or incidental to getting in that amount, be paid by the liquidator to the third party in respect of whom the liability was incurred to the extent necessary to discharge that liability, or any part of that liability remaining undischarged, in priority to all payments in respect of the debts mentioned in section If the liability of the insurer to the company is less than the liability of the company to the third party, subsection (1) does not limit the rights of the third party in respect of the balance. This section has effect notwithstanding any agreement to the contrary." There is an analogous provision in s 117 of the Bankruptcy Act 1966 (Cth) which vests, in the trustee in bankruptcy, the right of a bankrupt to indemnity, under a contract of insurance, against liabilities to third parties. It imposes a similar obligation on the trustee to pay over to such third parties amounts recovered under the insurance contract in respect of the bankrupt's liability to them. 5 The origin of s 562 was explained in Interchase Corporation Ltd (in liq) v FAI General Insurance Co Ltd [2000] 2 Qd R 301 at 314 per McPherson JA as a legislative response to In re Harrington Motor Co Ltd; Ex parte Chaplin [1928] Ch 105 and In re Southern Cross Coaches Ltd (1932) 49 WN (NSW) 230. Bell The liquidators' application to join CGU was made under r 9.06 of the Supreme Court (General Civil Procedure) Rules 2005 (Vic) which relevantly provided: "At any stage of a proceeding the Court may order that— any of the following persons be added as a party, namely— a person who ought to have been joined as a party or whose presence before the Court is necessary to ensure that all questions in the proceeding are effectually and completely determined and adjudicated upon; or a person between whom and any party to the proceeding there may exist a question arising out of, or relating to, or connected with, any claim in the proceeding which it is just and convenient to determine as between that person and that party as well as between the parties to the proceeding". The power conferred by that rule is to be exercised on the premise that the Court has jurisdiction with respect to the proceedings so far as they relate to the party to be joined. It is not itself a source of jurisdiction. If, as in this case, the Court is exercising federal jurisdiction, then the rule is applicable by operation of s 79 of the Judiciary Act 1903 (Cth)6. That section relevantly provides, in subs (1): "The laws of each State or Territory, including the laws relating to procedure, evidence, and the competency of witnesses, shall, except as otherwise provided by the Constitution or the laws of the Commonwealth, be binding on all Courts exercising federal jurisdiction in that State or Territory in all cases to which they are applicable." It is not suggested that there was any other law of the Commonwealth that "otherwise provided" so as to prevent the joinder rule being picked up by s 79. The Supreme Court of Victoria, like all superior courts, has inherent power to grant declaratory relief7. Section 36 of the Supreme Court Act 1986 6 Gordon v Tolcher (2006) 231 CLR 334 at 342 [11]; [2006] HCA 62. 7 Ainsworth v Criminal Justice Commission (1992) 175 CLR 564 at 581 per Mason CJ, Dawson, Toohey and Gaudron JJ; [1992] HCA 10. Bell (Vic) in terms common to Australian superior courts8 and based upon O 25 r 5 of the English Rules of the Supreme Court 1883 and s 50 of the Chancery Procedure Act 18529 provides: "A proceeding is not open to objection on the ground that a merely declaratory judgment is sought, and the Court may make binding declarations of right without granting consequential relief." In the exercise of federal jurisdiction by the Supreme Court, s 36 would be picked up by s 79 of the Judiciary Act and be applicable to the grant of declaratory relief in federal jurisdiction. The pleading The question before this Court being framed as one of jurisdiction, it is necessary to refer to the liquidators' Second Further Amended Points of Claim, which set out the claims both against the directors and against CGU. The Akron liquidators alleged that the company incurred debts totalling $14,657,189.05 between 1 August 2009 and 1 February 2010, a period defined in the pleading as the "Relevant Period". Each of the defendants was said to have been a director of the company within the meaning of s 9 of the Act for the whole of the Relevant Period. Mr Crewe had been appointed as a director on 19 July 2001 and had continued to be a director since that date. Crewe Sharp, having acted in the position of a director, was thereby a de facto director within the meaning of s 9 of the Act. Alternatively, because the directors of the company were accustomed to act in accordance with its instructions or wishes, it was a "director" within the extended definition of that term in s 9 of the Act. Akron was said to be insolvent during the Relevant Period and further, or alternatively, throughout lesser periods within the Relevant Period. There were reasonable grounds for suspecting that the company was insolvent or, alternatively, would so become insolvent at the time the debts were incurred. Each of the directors was said to have failed to prevent the company from incurring the debts and to have been aware that there were reasonable grounds for suspecting that the company was insolvent or would become insolvent by incurring the debts. A reasonable person in a like position would have been so aware. The directors were said, thereby, to have contravened s 588G(2) of the 8 See eg, s 21 of the Federal Court of Australia Act 1976 (Cth). 9 15 & 16 Vict, c 86. Bell Act. The creditors to whom the debts were owed had suffered loss and damage in relation to the debts because of the company's insolvency. Then it was said: "By reason of the matters set out in paragraphs 13 to 16 above, the Liquidators may recover under s 588M(2) of the Act from the First to Fourth Defendants, as a debt due to the Company, an amount equal to the loss and damage set out in paragraph 14 above." The amount was $14,657,189.05. The relief claimed against the directors was in the following terms: "An order under s 588M(2) of the Corporations Act 2001 (Cth) that the Defendants pay to the First Plaintiffs, as a debt due to the Second Plaintiff, an amount equal to the amount of the loss or damage suffered by the Creditors (the details of which are set out in the particulars subjoined to paragraph 6 of the Points of Claim) in relation to the debts owed to them by the Second Plaintiff, because of the insolvency of the Second Plaintiff." As to CGU, the liquidators alleged that it had issued an insurance policy, for the period 30 June 2009 to 30 June 2010, described as a Civil Liability Professional Indemnity policy in favour of Crewe Sharp and extending to its director, Mr Crewe. Express terms of the policy were pleaded, including that CGU would indemnify the insured "up to the Policy Limit for any Civil Liability to any third party which is incurred by the Insured in the conduct of the Professional Services" where the claims were made against the insured while the policy was in force, where CGU was given notice and where the claim arose from an act, error or omission on or after a date specified as the retroactive date. The limit of the cover provided under the policy was $5 million. The policy defined "Professional Services" as "the business of provision by the Insured of personnel, HR consultancy, management consultancy, business coaching, training and development consultancy, and debt recovery services". Exclusions relied upon by CGU in rejecting the claim for indemnity were pleaded and were said not to apply. CGU's denial of liability was pleaded. CGU's liability under the policy and the operation of s 562 of the Act were pleaded: "25. By reason of the matters set out in paragraphs 18 to 24 above, CGU is liable to indemnify Crewe Sharp and Trevor Crewe under the Policy in respect of the amounts claimed by the Plaintiffs from Crewe Sharp and Trevor Crewe in this proceeding up to Bell 26. By reason of s 562 of the Act, any amount received by Crewe Sharp or its liquidator from CGU in respect of the Plaintiffs' claims must be paid to the Plaintiffs." A plea in similar terms was set up in relation to a policy issued by CGU for the period from 30 June 2012 to 30 June 2013. The declaration sought against CGU was as follows: "A declaration that the Fifth Defendant is liable to indemnify the First and Fourth Defendants in respect of any judgment herein obtained by the Plaintiffs against the First and Fourth Defendants and in respect of any sums (including legal costs) which the Court may order the First and Fourth Defendants to pay to the Plaintiffs." Mr Crewe and Crewe Sharp filed an amended defence asserting, inter alia, that they had reasonable grounds to expect, and did expect, that Akron was solvent during the Relevant Period and would remain solvent even if it incurred the debts or any of them. CGU filed a defence. It relied upon the exclusion clauses and contended that the liquidators' claims against the directors did not constitute a "civil liability" or any liability incurred in the conduct of "professional services" within the meaning of the policy. It further alleged that Mr Crewe and Crewe Sharp had breached their duties of disclosure under s 21(1) of the Insurance Contracts Act 1984 (Cth) in failing to disclose that they provided company director and officer services. By reason of that non-disclosure any entitlement they had to indemnity was reduced to zero pursuant to s 28(3) of the Insurance Contracts Act. A similar plea was made in respect of the 2012/2013 policy. In light of the pleadings, and as explained below, the jurisdiction invoked by the liquidators in the Supreme Court was federal jurisdiction. The nature of the jurisdiction invoked by the Akron liquidators "State jurisdiction is the authority which State Courts possess to adjudicate under the State Constitution and laws; federal jurisdiction is the authority to adjudicate derived from the Commonwealth Constitution and laws."10 Jurisdiction with respect to a particular subject matter is authority to 10 Baxter v Commissioners of Taxation (NSW) (1907) 4 CLR 1087 at 1142 per Isaacs J; [1907] HCA 76, cited in Lipohar v The Queen (1999) 200 CLR 485 at 516–517 [78] per Gaudron, Gummow and Hayne JJ; [1999] HCA 65 and Minister (Footnote continues on next page) Bell adjudicate upon a class of questions concerning that subject matter. The existence before a court of a question of the relevant subject matter class is necessary to the court's authority to adjudicate. It is not, however, sufficient to enliven the judicial power. As Griffith CJ said in Ah Yick v Lehmert11, the term "federal jurisdiction" in s 71 of the Constitution means "authority to exercise the judicial power of the Commonwealth ... within limits prescribed."12 Later in the same judgment the Chief Justice spoke of Parliament, under s 77(i), giving to a federal court created by it "jurisdiction to exercise any judicial power of the Commonwealth, which the Parliament may think fit to confer upon it"13. The identification of the subject matter of the proceeding is necessary to determine whether judicial power is invoked within its prescribed limits. Other limits on "judicial power" are encompassed by such terms as "justiciability", "standing" and "incompatibility"14. "Jurisdiction" in the sense of authority to adjudicate and "judicial power" are different concepts15. There is also a distinction to be made, discussed below, between jurisdiction and specific powers to grant particular remedies. Observations about such distinctions may be made with an acceptance that there are other usages of the term "jurisdiction" which are not material for present purposes and which it is not necessary to explore16. It is a necessary condition of federal jurisdiction, in the sense of authority to exercise the judicial power of the Commonwealth, that the matter in which the jurisdiction of the court is invoked is "capable of judicial determination" or for Immigration and Multicultural and Indigenous Affairs v B (2004) 219 CLR 365 at 394–395 [68] per Gummow, Hayne and Heydon JJ; see also at 377 [6] per Gleeson CJ and McHugh J; [2004] HCA 20. 11 (1905) 2 CLR 593; [1905] HCA 22. 12 (1905) 2 CLR 593 at 603. 13 (1905) 2 CLR 593 at 604. 14 Leeming, Authority to Decide: The Law of Jurisdiction in Australia, (2012) at 1.7. 15 Stellios, The Federal Judicature: Chapter III of the Constitution, (2010) at [7.2]. 16 See generally Leeming, Authority to Decide: The Law of Jurisdiction in Australia, Bell "justiciable"17. That concept of justiciability does not embrace a purely advisory opinion. In holding invalid Commonwealth legislation purporting to confer an advisory jurisdiction this Court in In re Judiciary and Navigation Acts said that18: "there can be no matter within the meaning of [s 76] unless there is some immediate right, duty or liability to be established by the determination of the Court." An entitlement to claim declaratory relief may be created by statute even though the subject matter of the relief is not an immediate right, duty or liability to be established. The declaration itself may assume that description where it concerns a real controversy susceptible of judicial determination. Truth About Motorways Pty Ltd v Macquarie Infrastructure Investment Management Ltd19 may be cited as an example. Any member of the public was given standing by s 163A of the Trade Practices Act 1974 (Cth) to seek a declaration in relation to the operation or effect of any provision of that Act other than certain excluded provisions. Gleeson CJ and McHugh J said20: "The fact that no private right, or special interest, of the applicant is at stake in the present case does not deny to its disputed assertion that the respondent has violated s 52 of the Act and its claim for remedies of the kind provided by the Act the character of a justiciable controversy." The subject matter and justiciability requirements were summarised by Burmester21: "'Matter', therefore, has two elements: the subject matter itself as defined by reference to the heads of jurisdiction set out in Chapter III, and the concrete or adequate adversarial nature of the dispute sufficient to give rise to a justiciable controversy." 17 South Australia v Victoria (1911) 12 CLR 667 at 708 per O'Connor J; [1911] HCA 18 (1921) 29 CLR 257 at 265; [1921] HCA 20. 19 (2000) 200 CLR 591; [2000] HCA 11. 20 (2000) 200 CLR 591 at 603 [20]. 21 Burmester, "Limitations on Federal Adjudication", in Opeskin and Wheeler (eds), The Australian Federal Judicial System, (2000) 227 at 232. Bell The constitutional requirements for the existence of a matter were not in issue in this appeal. What was in issue was the existence of a justiciable controversy between the Akron liquidators and CGU. Section 39(2) of the Judiciary Act invests the Supreme Court with federal jurisdiction "in all matters in which the High Court has original jurisdiction or in which original jurisdiction can be conferred upon [the High Court]", save for certain immaterial exceptions. By virtue of s 76(ii) of the Constitution the matters in respect of which jurisdiction may be conferred upon the High Court include "any matter ... arising under any laws made by the Parliament". In addition to the general jurisdiction conferred by s 39(2) of the Judiciary Act, s 1337B of the Act invests the Supreme Courts of the States with jurisdiction "with respect to civil matters arising under the Corporations legislation."22 The term "civil matter" is defined in s 9 of the Act as "a matter other than a criminal matter." The term "criminal matter" is not defined. The use of the constitutional term "matter" in the statutory investing of Supreme Courts with general and specific federal jurisdiction directs attention to the frequently quoted observation of Latham CJ in R v Commonwealth Court of Conciliation and Arbitration; "a matter may properly be said to arise under a Federal law if the right or duty in question in the matter owes its existence to Federal law or depends upon Federal law for its enforcement, whether or not the determination of the controversy involves the interpretation (or validity) of the law." It is a particular application of that general statement to say that a matter will arise under a federal law if it involves a claim at common law or equity or under a law of a State where the claim is "in respect of a right or property which is the creation of federal law"24. If the source of a defence to a claim at common law or equity or under a law of a State is a law of the Commonwealth, then on 22 The interaction between s 39(2) of the Judiciary Act and the conferral of jurisdiction in Div 1 of Pt 9.6A of the Act is further explained in Gordon v Tolcher (2006) 231 CLR 334 at 345 [29]. 23 (1945) 70 CLR 141 at 154; [1945] HCA 50, quoted with approval in LNC Industries Ltd v BMW (Australia) Ltd (1983) 151 CLR 575 at 581; [1983] HCA 31 and Re McJannet; Ex parte Australian Workers' Union of Employees (Q) [No 2] (1997) 189 CLR 654 at 656–657; [1997] HCA 40. 24 LNC Industries Ltd v BMW (Australia) Ltd (1983) 151 CLR 575 at 581. Bell that account also the matter may be said to arise under federal law25. The existence of such a claim in a proceeding will meet the subject matter condition necessary to enliven the federal jurisdiction invested in a court of a State pursuant to s 77(iii) of the Constitution, read with s 76(ii). However, before federal jurisdiction can be enlivened, the claims in the proceeding must not only satisfy the subject matter requirements, but involve a justiciable controversy or otherwise fall within an established category of judicial power26. The justiciability requirement encompassed in the concept of "matter" appears in the description of that term by the majority in Fencott v Muller27 as "a justiciable controversy, identifiable independently of the proceedings which are brought for its determination and encompassing all claims made within the scope of the controversy"28. It has an evaluative element as also appears from the majority judgment in Fencott29: "What is and what is not part of the one controversy depends on what the parties have done, the relationships between or among them and the laws which attach rights or liabilities to their conduct and relationships. The scope of a controversy which constitutes a matter is not ascertained merely by reference to the proceedings which a party may institute, but may be illuminated by the conduct of those proceedings and especially by the pleadings in which the issues in controversy are defined and the claims for relief are set out." 25 LNC Industries Ltd v BMW (Australia) Ltd (1983) 151 CLR 575 at 581, citing Felton v Mulligan (1971) 124 CLR 367 at 408; [1971] HCA 39. 26 Eg the long-standing power of courts to give directions to trustees, administrators and executors and to determine questions arising in the course of company winding up processes or the traditional powers of courts to make orders relating to the maintenance and guardianship of infants, as outlined in R v Davison (1954) 90 CLR 353 at 368–369 per Dixon CJ and McTiernan J; [1954] HCA 46. 27 (1983) 152 CLR 570; [1983] HCA 12. 28 (1983) 152 CLR 570 at 603 per Mason, Murphy, Brennan and Deane JJ. 29 (1983) 152 CLR 570 at 608 per Mason, Murphy, Brennan and Deane JJ. Bell The evaluative element is illustrated by, but not confined to, the delineation of the so called "accrued jurisdiction" to entertain non-federal claims in federal jurisdiction, by their Honours' observation that it is30: "a matter of impression and of practical judgment whether a non-federal claim and a federal claim joined in a proceeding are within the scope of one controversy and thus within the ambit of a matter." The existence of jurisdiction is anterior to the existence of the power to grant particular relief. As Gleeson CJ and McHugh J said in Minister for Immigration and Multicultural and Indigenous Affairs v B31: "In a legal context the primary meaning of jurisdiction is 'authority to decide'. It is to be distinguished from the powers that a court may use in the exercise of its jurisdiction." (footnotes omitted) The distinction has been made frequently in this Court32. 30 (1983) 152 CLR 570 at 608 per Mason, Murphy, Brennan and Deane JJ. As Gummow and Hayne JJ observed in Re Wakim; Ex parte McNally (1999) 198 CLR 511 at 585 [140]; [1999] HCA 27, the references to "impression" and "practical judgment" cannot be understood as stating a test to be applied. Considerations of impression and practical judgment are relevant because the question of jurisdiction usually arises before evidence is adduced and often before the pleadings are complete. Necessarily, then, the question will have to be decided on limited information. 31 (2004) 219 CLR 365 at 377 [6]. See also to similar effect at 395 [69] per Gummow, Hayne and Heydon JJ, citing Harris v Caladine (1991) 172 CLR 84 at 137 per Toohey J; [1991] HCA 9. 32 Jackson v Sterling Industries Ltd (1987) 162 CLR 612 at 616 per Mason CJ, 619 per Wilson and Dawson JJ, 627–628 per Toohey J; [1987] HCA 23; Patrick Stevedores Operations No 2 Pty Ltd v Maritime Union of Australia (1998) 195 CLR 1 at 29 [27]–[28], 32 [35] per Brennan CJ, McHugh, Gummow, Kirby and Hayne JJ; [1998] HCA 30; Lipohar v The Queen (1999) 200 CLR 485 at 516–517 [78] per Gaudron, Gummow and Hayne JJ; Australian Securities and Investments Commission v Edensor Nominees Pty Ltd (2001) 204 CLR 559 at 590 [64]–[65] per Gleeson CJ, Gaudron and Gummow JJ; [2001] HCA 1; Keramianakis v Regional Publishers Pty Ltd (2009) 237 CLR 268 at 280 [36] per French CJ; [2009] HCA 18; Osland v Secretary, Department of Justice [No 2] (2010) 241 CLR 320 at 332 [19] per French CJ, Gummow and Bell JJ; [2010] HCA 24; Lacey v (Footnote continues on next page) Bell The Akron liquidators' proceeding against the directors involved a matter arising under a law made by the Commonwealth Parliament, namely ss 588G and 588M of the Act. If Mr Crewe and Crewe Sharp had instituted third party proceedings against CGU claiming indemnity under the insurance policy, an indemnity which depended for its existence upon the existence of a liability to pay damages pursuant to s 588M of the Act, then their claim would have involved a matter arising under federal law. And if CGU chose to invoke s 21 of the Insurance Contracts Act, as it did in its pleadings before the Supreme Court, the matter would, on that account, also have been a matter arising under federal law. The third party proceedings would properly have been characterised as part of the matter defined by the Akron liquidators' claim against the directors. The matter, defined by reference to the Akron liquidators' claims against the directors and a third party claim by the directors against CGU, would have met the subject matter requirement for the existence of federal jurisdiction and involved claims enlivening the judicial power of the Commonwealth. The question for this appeal is whether the Akron liquidators' claim for declaratory relief against CGU involved a matter arising under a law of the Commonwealth in which the Supreme Court had federal jurisdiction, invested by statute, to exercise the judicial power of the Commonwealth in the sense described above. Alternatively, the question may be asked whether the claim was part of the matter in which the liquidators claimed against the directors. The Akron liquidators' claim for declaratory relief against CGU answered the subject matter requirement for the exercise of federal jurisdiction by the Supreme Court. It depended upon the existence of a liability under s 588M of the Act said to enliven the indemnity obligation under the CGU insurance policy. The question whether the judicial power of the Commonwealth invested in the Supreme Court was enlivened by the claim for declaratory relief against CGU depends upon whether that claim involved a justiciable controversy. The reasoning of the primary judge and the Court of Appeal focused on the availability of the declaratory relief sought. The written submissions filed by counsel followed a similar path. The reasoning appears to have proceeded on the basis that non-federal rather than federal jurisdiction was engaged. Nevertheless, much of what was said may be treated as a surrogate for argument on the question whether the Akron liquidators' claim against CGU involved a controversy cognisable in the exercise of federal jurisdiction. There was Attorney-General (Qld) (2011) 242 CLR 573 at 593–594 [48] per French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ; [2011] HCA 10. Bell reference in the Supreme Court and in argument before this Court to differences of view expressed in intermediate courts of appeal concerning the availability of the relief. The decisions of intermediate courts of appeal Intermediate courts of appeal have not always drawn a clear distinction between jurisdiction and power in this class of case. That is not least because argument before those courts has focused on matters such as utility going to discretion to grant the declaratory relief, which overlaps with issues of standing and justiciability relevant to the availability of the remedy. In JN Taylor Holdings Ltd (In liq) v Bond33, King CJ, with whom Prior and Perry JJ agreed34, considered whether the Supreme Court of South Australia had "jurisdiction" to grant a declaration sought by the liquidators of the appellant companies against the directors' insurer. The Chief Justice said that the Court's power to grant declaratory relief was limited only by its own discretion and the boundaries of judicial power35. In so saying, he acknowledged a distinction between the jurisdiction to entertain the action at all and a settled practice of the Court to exercise its discretion by withholding the relief in certain factual situations36. The reference to "jurisdiction" may be understood as a reference to the limits of the Court's jurisdiction. It was not suggested that a "settled practice" going to discretion defined the limits of jurisdiction or of the Court's power. Nevertheless, the discretionary considerations to which the Chief Justice referred would be relevant to the existence of a "matter" in federal jurisdiction37. 33 (1993) 59 SASR 432. 34 (1993) 59 SASR 432 at 443. 35 (1993) 59 SASR 432 at 436. 36 (1993) 59 SASR 432 at 436, citing Rediffusion (Hong Kong) Ltd v Attorney- General of Hong Kong [1970] AC 1136 at 1155. 37 (1993) 59 SASR 432 at 436. Bell King CJ required that the plaintiff have a real interest in the determination of the question raised by the declaration — a purely theoretical question would weigh against the grant of relief38. On the other hand, a plaintiff could have a real interest in the question even though its impact on the plaintiff might be no more than a possibility39. The liquidators' interest in obtaining a declaration of the insurer's liability concurrently with that of the directors was "undeniable"40. In that case the Full Court was concerned with proceedings under the Companies Code of South Australia. It was not thereby concerned with the exercise of federal jurisdiction. A different result was reached by the Court of Appeal of Queensland in Interchase Corporation Ltd (in liq) v FAI General Insurance Co Ltd41. The insurer of valuers who were sued for professional negligence had denied liability and that denial was not contested by the valuers. The plaintiff sought joinder of the insurer to claim a declaration that the insurer was liable to indemnify the valuers in respect of their asserted liability. Joinder was ordered by a Judge in Chambers but an appeal was allowed by McPherson JA and Byrne J over the dissent of Davies JA. Byrne J based his reasons upon the terms of the joinder rule, which authorised the joinder of persons whose "presence before the Court may be necessary in order to enable the Court effectually and completely to adjudicate upon and settle all the questions involved in the cause or matter"42. His Honour held that the joinder served no useful purpose. The declaration sought could not directly affect any property, legal right or obligation of the plaintiff. Nor could it effectively determine the insurer's rights or duties. A judicial determination of the issues pertaining to the plaintiff's claim for declaratory relief could not shut out the insurer from litigating about them again in proceedings under s 562 of the Act or s 117 of the Bankruptcy Act. More fundamentally, he held that as between 38 (1993) 59 SASR 432 at 436–437. 39 (1993) 59 SASR 432 at 437, citing Hordern-Richmond Ltd v Duncan [1947] KB 40 (1993) 59 SASR 432 at 438. 41 [2000] 2 Qd R 301. 42 [2000] 2 Qd R 301 at 316, citing Rules of the Supreme Court (Q), O 3 r 11(2) (since repealed). Bell insurer and insured there was no controversy and there could be no res judicata43. Nor could a defence by the insurer to an indemnity claim in later proceedings constitute an abuse of process. The declaratory relief sought would have the character of an advisory opinion44. McPherson JA agreed with Byrne J and added that the presence of the insurer was not "necessary" in the sense required by the joinder rule45. Davies JA, in dissent, identified the question before the Court as a question of "power under the Rules of Court to order the joinder sought" and whether the primary judge had erred in exercising his discretion to permit the joinder46. A grant of declaratory relief would have utility as it would be an abuse of process for the insurer or the insured to litigate the question determined by the declaration in later proceedings47. The declaration sought could therefore "effectively determine the question of [the insurer's] liability to the valuers as between those parties."48 The question was not hypothetical49: "the insolvency of the valuers, their failure to seek an indemnity from [the insurer] and the ineffectuality of any judgment by [the plaintiff] against the valuers unless [the insurer] is liable to indemnify them — together combine, in my view, to give [the plaintiff] a real interest in the relief which it seeks." The difference between his Honour's approach and that of the majority reflected not so much a difference in principle as a different evaluation of the interest of the plaintiff in bringing the claim against the insurer and the utility of the declaratory relief sought. For the purposes of determining whether there is a "matter" attracting federal jurisdiction in such claims, the approach adopted by Davies JA is to be preferred. It reflected a recognition of the reality of the 43 [2000] 2 Qd R 301 at 318–319. 44 [2000] 2 Qd R 301 at 320. 45 [2000] 2 Qd R 301 at 312. 46 [2000] 2 Qd R 301 at 307. 47 [2000] 2 Qd R 301 at 310–311. 48 [2000] 2 Qd R 301 at 311. 49 [2000] 2 Qd R 301 at 311. Bell plaintiff's interest which was not to be confined by a requirement that the plaintiff demonstrate a claim for vindication of an existing legal right against the insurer. In Employers Reinsurance Corporation v Ashmere Cove Pty Ltd50 a Full Court of the Federal Court rejected an argument that declaratory relief sought by plaintiffs against a defendant's insurers was beyond the judicial power of the Commonwealth. Their Honours referred to the distinction between a "matter" and the legal proceeding in which the matter is determined, reiterating that the two are not synonymous51. They observed that the "justiciable controversy" before the Federal Court, and thereby the matter before that Court, was not defined by the contractual relationship between the insurers and the insured. In that case the insured maintained but did not pursue its entitlement to indemnity. The plaintiff investors had a real interest in establishing that the insurers were liable to indemnify the insured with respect to the liability the subject of the claim against it. That analysis is equally applicable to the scope of the relevant statutory jurisdiction conferred on the Supreme Court by s 1337B of the Act and by s 39(2) of the Judiciary Act in so far as each grant refers to "matters". The preceding analysis would bring the claim against CGU in this case within the scope of a "justiciable controversy" capable of constituting a "matter" for the purposes of federal jurisdiction where the subject matter falls within the grant of jurisdiction. There was no dispute in the Full Court in Ashmere Cove that the Federal Court had power to grant declaratory relief against the insurers. The remaining debate in that case went to discretion by reference to practical utility. In that connection the Court held that the principle enunciated by this Court in Port of Melbourne Authority v Anshun Pty Ltd52 would probably preclude the insurers, in subsequent proceedings involving the same parties, from agitating any defence they could have invoked against the plaintiffs' claim53. In that way the proposed 50 (2008) 166 FCR 398. 51 (2008) 166 FCR 398 at 408 [43]–[44], citing Crouch v Commissioner for Railways (Q) (1985) 159 CLR 22 at 37; [1985] HCA 69 and Re Wakim; Ex parte McNally (1999) 198 CLR 511 at 585 [138]–[139]. 52 (1981) 147 CLR 589; [1981] HCA 45. 53 (2008) 166 FCR 398 at 413–414 [71]. Bell proceedings could effectively finally determine the question of the insurers' liability. This Court refused an application for special leave to appeal against the decision of the Full Court54. A similar approach, focused on the availability of the remedy rather than jurisdiction, was taken in QBE Insurance (Australia) Ltd v Lois Nominees Pty Ltd55. In that case, the plaintiff claimed equitable compensation against a solicitor who became a bankrupt and, being refused joinder of a claim for declaratory relief against the solicitor's insurer, commenced separate proceedings seeking such relief which were consolidated with the primary action. An appeal by the insurer against dismissal of a motion for summary judgment against the plaintiff was dismissed by a majority in the Court of Appeal of Western Australia. The appeal was dismissed on the basis that the availability of declaratory relief was arguable56 albeit the question remained whether the insured should be joined in the proceedings against the insurer. The focus of the majority reasoning was on the utility of the proceedings by reference to the limits imposed on relitigation by abuse of process considerations. McLure P, in dissent, held that the real controversy in the case was between the insured and his insurer and the plaintiff was not a proper contradictor. On that basis there was no utility in the claim57. Her Honour expressed doubt about the correctness of the decision of the Full Court of the Federal Court in Ashmere Cove58. Only in one of the preceding decisions has the court held the relief not to be available, that being the decision of the Court of Appeal of Queensland. That decision involved an application of a joinder rule and no direct consideration of jurisdiction. The application of the majority judgment in that case and the dissent of McLure P in the Court of Appeal of Western Australia to federal jurisdiction is at best indirect and, in any event, not to be preferred in evaluating the concreteness of the controversy between the liquidators and CGU in this case. 54 [2008] HCATrans 296 (Gummow, Hayne and Kiefel JJ). 55 (2013) 17 ANZ Insurance Cases ¶61-949. 56 (2013) 17 ANZ Insurance Cases ¶61-949 at 73,113–73,114 [116]–[121] per Newnes JA, 73,131 [228] per Murphy JA. 57 (2013) 17 ANZ Insurance Cases ¶61-949 at 73,103 [51]. 58 (2013) 17 ANZ Insurance Cases ¶61-949 at 73,100 [34]. Bell The primary judge's decision The Akron liquidators contended before Judd J that they had a sufficient interest in the determination of CGU's liability to support their claim for a declaration and thus for joinder. They relied upon s 562 of the Act. They also contended that if they were successful in their claim against Mr Crewe he would become a bankrupt, in which case his trustee in bankruptcy would have similar rights by operation of s 117 of the Bankruptcy Act. CGU opposed joinder on the basis that, there being no claim against it by its insured, there was no justiciable controversy. It made the obvious point that s 562 does not confer on a liquidator a right of action against an insurer to enforce insurance policies. The liquidator's interest would be hypothetical and contingent upon an insured successfully enforcing a right. The possible bankruptcy of Mr Crewe was also hypothetical and contingent. Further it was said that the Court had no jurisdiction under s 36 of the Supreme Court Act 1986 (Vic) to grant the declaratory relief sought and, if it did have jurisdiction, should decline to do so in the exercise of discretion. Section 36, however, goes to power rather than to jurisdiction in the sense relevant for present purposes. The submissions from CGU, to the extent that they were reflected in his Honour's reasons, focused on the power to award declaratory relief. The key finding by his Honour appeared at [48] of his reasons for judgment, in which he said: "The claim by the plaintiffs, that CGU is bound to indemnify the insured, arises out of, or relates to, or is connected with their claim against the insured as defendants. The plaintiffs have a sufficient interest in the proceeds of insurance to provide them with standing to apply for declaratory relief. Furthermore, by reason of s 562 of the Act, and the duty of liquidators to creditors of Akron Roads, there is a justiciable dispute consequent upon CGU's denial of liability under the policy." He referred to factors rendering it "just and convenient that the dispute between the plaintiffs and CGU be resolved at the same time, and in the same proceeding, as the dispute between the plaintiffs and the insured."59 That approach was said to be consistent with the overarching purpose under the Civil Procedure Act 2010 (Vic). There was no express reference to jurisdiction or federal jurisdiction. 59 [2015] VSC 34 at [48]. Bell The decision of the Court of Appeal of the Supreme Court of Victoria CGU sought leave to appeal to the Court of Appeal on the single proposed ground that Judd J had erred in law in joining it as a defendant to the proceeding: "because courts have no jurisdiction at the suit of a stranger to grant declaratory relief as to the meaning and effect of a private contract between parties who will not pursue any claim relating to rights or duties under that contact." In support of the application for leave, the proposed appeal was said to involve "principles of law about which intermediate courts of appeal in Australia have expressed divergent views". The Court of Appeal referred to the limits of declaratory relief discussed by this Court in Ainsworth v Criminal Justice Commission60. While that discussion was not framed by reference to jurisdiction, the Court of Appeal regarded as significant this Court's identification of the need for a "real interest" on the part of the person seeking declaratory relief coupled with foreseeable consequences for the parties if a declaration were to be made61. In a passage which suggested that their Honours' attention had not been directed to the nature of the jurisdiction which had been invoked in the proceedings before them, they said62: "The position is of course different in the context of federal jurisdiction, where there must be a 'matter' sufficient to attract the exercise of judicial power. For that reason, observations about limits on the power of courts exercising federal jurisdiction to grant declarations do not necessarily assist CGU's jurisdictional argument." (footnote omitted) The Court acknowledged that "even in that context"63 (ie a court exercising federal jurisdiction) authority was against the view that the Court lacked jurisdiction. It referred to Ashmere Cove64. It held on the basis of the 60 (1992) 175 CLR 564. 61 (2015) 18 ANZ Insurance Cases ¶62-073 at 76,691 [22]. 62 (2015) 18 ANZ Insurance Cases ¶62-073 at 76,691 [23]. 63 (2015) 18 ANZ Insurance Cases ¶62-073 at 76,691 [24]. 64 (2008) 166 FCR 398. Bell reasoning in that case that it would be an abuse of process to permit either the insured or CGU to relitigate the question determined by the declaratory proceedings. It was not necessary to decide whether those proceedings would give rise to a res judicata between the insured and CGU65. Their Honours noted that the dissent of McLure P in QBE Insurance and her Honour's doubt about the correctness of Ashmere Cove expressed in that dissent depended in part upon an observation by Gaudron J in Truth About Motorways66: "There may be cases where, absent standing, there is no justiciable controversy. That may be because the court is not able to make a final and binding adjudication. To take a simple example, a court could not make a final and binding adjudication with respect to private rights other than at the suit of a person who claimed that his or her right was infringed. Or there may be no justiciable controversy because there is no relief that the court can give to enforce the right, duty or obligation in question." (emphasis added by McLure P; footnote omitted) In noting this influence on McLure P's reasoning, the Court of Appeal observed that Truth About Motorways "was a case in federal jurisdiction."67 That observation tends to reinforce the conclusion that the Court of Appeal and counsel before it did not appreciate that the case with which it was concerned was one of federal jurisdiction. Their Honours also referred to the Court of Appeal's earlier decision in CE Heath Casualty & General Insurance Ltd v Pyramid Building Society (In liq)68 in which joinder of an insurer was refused on discretionary grounds. In that case Ormiston JA (Tadgell JA agreeing) observed that absent authority he would have had the "gravest doubt whether it was ordinarily appropriate to permit an outsider to seek from the court declaratory relief as to the meaning and effect of a contract between two parties who had not themselves raised any issue as to its meaning and effect and at least one of whom objected to the court's interfering in 65 (2015) 18 ANZ Insurance Cases ¶62,073 at 76,691 [26]. 66 (2000) 200 CLR 591 at 611–612 [46], cited in (2013) 17 ANZ Insurance Cases 67 (2015) 18 ANZ Insurance Cases ¶62,073 at 76,691–76,692 [27]. Bell its private affairs."69 As the Court of Appeal in the present case observed, what was said in CE Heath was not directed to jurisdiction70. It may be added that the reference to interference in the "private affairs" of insurer and insured involved a reductionist approach to the significance for creditors of the insurer's liability, a fortiori in the light of s 562 of the Act and s 117 of the Bankruptcy Act. The Court of Appeal concluded that71: "For present purposes, all that matters is that the first and second respondents have a sound basis for seeking declaratory relief, on the basis that there may be practical utility in having an issue in which they have a real interest resolved in this manner." The grounds of appeal The grounds of appeal in this Court were: The Court erred in dismissing the appeal because the Court does not have jurisdiction at the suit of the first and second respondents to grant declaratory relief as to the meaning and effect of a contract to which they are not parties and when the parties to the contract, being the appellant and the third and sixth respondents, are not themselves in dispute. The Court ought to have held that the learned primary judge erred in law in joining the appellant as a defendant to the proceeding because courts have no jurisdiction at the suit of a stranger to grant declaratory relief as to the meaning and effect of a private contract between parties who will not pursue any claim relating to rights or duties under that contract." The grounds thus expressed focused solely on jurisdiction albeit, having regard to the written submissions filed in this Court, they did not draw a clear distinction between jurisdiction, power and discretion. The conceptual distinctions are important even though, in the context of federal jurisdiction, factors relevant to 69 [1997] 2 VR 256 at 270. 70 (2015) 18 ANZ Insurance Cases ¶62-073 at 76,693 [30]–[31]. 71 (2015) 18 ANZ Insurance Cases ¶62-073 at 76,694 [37]. Bell the power to grant the remedy and discretionary refusal may go to the existence of a "matter". Contentions and conclusions CGU, in its written submissions, argued that the Court of Appeal erred in: dismissing cases in federal jurisdiction as irrelevant; holding that the insurer would be precluded by the Anshun doctrine from seeking to relitigate issues decided adversely to it in the declaratory proceedings; (iii) failing to find that the declaration, if made, would not bind the parties; and finding that s 562 of the Act and s 117 of the Bankruptcy Act "operate as an exception to the privity rule and provide the basis upon which an outsider may seek declaratory relief about the meaning and effect of a contract." The parties to the appeal in their written submissions did not put argument on whether the Supreme Court was being asked to exercise federal jurisdiction in the claim for declaratory relief. This Court sent the parties a letter prior to the hearing of the appeal asking that they consider: "Whether the joinder of the appellant in the proceedings in the Supreme Court of Victoria invoked the jurisdiction of that Court in a matter arising under a law of the Commonwealth pursuant to s39(2) of the Judiciary Act 1903 and/or s1337B of the Corporations Act 2001." The CGU argument, to the extent that it engaged with the question of federal jurisdiction, reduced to the proposition that there was no justiciable controversy between the liquidators and CGU, and therefore no "matter". The Akron liquidators on the other hand contended that the claim did involve the invocation of federal jurisdiction. For the reasons already given, the claims which the Akron liquidators seek to bring against CGU involve a question arising under a law of the Commonwealth. It is a necessary condition of the liability of CGU to indemnify Mr Crewe and Crewe Sharp that they be liable to the liquidators pursuant to s 588M of the Act. That is, of course, not a sufficient condition of CGU's liability under the policy. That liability will also depend upon the scope of the cover provided by the policy, properly construed, and, if they become relevant, Bell the merits of the specific defences which have been raised to the Akron liquidators' claims. The question raised by the Akron liquidators' claim is one within the subject matter area of federal jurisdiction. The next inquiry is whether it reflects a justiciable controversy between the Akron liquidators and CGU. It is in that area that the parties essentially joined issue on this appeal. In light of the foregoing reasons, that question can be answered quite shortly. Crewe Sharp had made a claim against CGU under the policy and CGU had declined that claim. Neither Crewe Sharp nor its liquidators nor Mr Crewe accepted the denial of liability. Mr Crewe, who was also an insured person under the policy, disagreed with the decision and consented to the joinder of CGU. The liquidators of Crewe Sharp were not in a position to investigate CGU's denial of liability and took no position on the joinder. If the Akron liquidators made good their claim against Crewe Sharp and Mr Crewe, and established the liability of CGU to indemnify its insured, the proceeds of the policy so far as they related to Crewe Sharp would have been payable by the liquidators of Crewe Sharp to the Akron liquidators subject to the deductions mentioned in s 562 of the Act. If Mr Crewe himself became a bankrupt then s 117 of the Bankruptcy Act could apply to similar effect with respect to his trustee in bankruptcy. As the Akron liquidators have submitted, their claim does not depend upon any incursion upon principles of contract law or privity of contract. They are not claiming as a party to the insurance contract nor as persons otherwise entitled to the benefit of that contract. Their claim is based upon the legal consequence created by s 562 of the Act in the event that CGU is liable to indemnify Crewe Sharp and, more contingently, s 117 of the Bankruptcy Act in the event that CGU is liable to indemnify Mr Crewe and he becomes a bankrupt. That legal consequence would be the bringing into existence, in favour of the Akron liquidators, of a right to the proceeds of the insurance policy payable to Crewe Sharp in respect of its liability to Akron. The interest upon which the claim for declaratory relief is based and CGU's denial of liability under the policy are sufficient to constitute a justiciable controversy between the Akron liquidators and CGU involving a question arising under a law of the Commonwealth. Because of these statutory provisions, it is the Akron liquidators who stand to benefit (to the exclusion of Crewe Sharp and Mr Crewe) from the making of the declaration sought. It would be distinctly to ignore this reality if the liquidators' interest in this regard could be defeated by reason of inaction on the part of Crewe Sharp and Mr Crewe against CGU given that the Bell statutory provisions themselves deprive Crewe Sharp and Mr Crewe of all incentive to pursue a claim under the policy. The declaration sought by the Akron liquidators would be binding as between them and CGU. In the circumstance in which the insured are also parties, albeit not conceding CGU's position nor claiming relief against it, it is unlikely that they or CGU would be permitted to relitigate, in subsequent proceedings, issues which had been determined or which could properly, and should, have been agitated in the proceedings against CGU. The application of preclusive doctrines against relitigation, which would support the utility of declaratory relief, is in the circumstances of this case theoretical. Given the position of the parties there would seem to be little or no prospect of any relitigation being embarked upon which would require consideration of those doctrines. For all practical purposes the declaratory claim brought by the Akron liquidators will be the only occasion on which CGU's denial of liability is contested. This is a case in which the Supreme Court has federal jurisdiction to entertain the claim by the Akron liquidators against CGU and power to grant the declaratory relief sought. The appeal should be dismissed. The appellant is to pay the respondents' costs of the appeal. Nettle NETTLE J. The first respondents ("the liquidators") are the liquidators of the second respondent, Akron Roads Pty Ltd (in liq) ("Akron Roads"). In 2013, the liquidators and Akron Roads instituted a proceeding in the Supreme Court of Victoria against, inter alia, the third and sixth respondents ("the directors") as directors of Akron Roads for damages for breach of s 588G(2) of the Corporations Act 2001 (Cth) ("the proceeding"). During the early interlocutory stages of the proceeding, the primary judge (Judd J) granted the liquidators leave to join the directors' professional indemnity insurer ("CGU") as an additional defendant to the proceeding and to amend the liquidators' points of claim to include a claim for a declaration that CGU is liable to pay the directors the amount which the directors are ordered to pay to the liquidators. CGU applied for leave to appeal to the Court of Appeal (Ashley, Beach and McLeish JJA) on the ground that Judd J did not have jurisdiction to make the declaration that was sought. Leave was granted but the appeal was dismissed. By grant of special leave, CGU now appeals to this Court. For the reasons which follow, this appeal should be dismissed. The facts The liquidators were appointed as liquidators of Akron Roads in March 2010. A little over three years later, they instituted the proceeding in the Commercial and Equity Division of the Supreme Court of Victoria against the third, fourth and fifth respondents, who were formerly directors of Akron Roads, and the sixth respondent, Crewe Sharp Pty Ltd ("Crewe Sharp"), a company controlled by the third respondent ("Mr Crewe"). The liquidators alleged that either Crewe Sharp acted in the position of a director, or, alternatively, Akron Roads' directors were accustomed to acting in accordance with Crewe Sharp's wishes, and therefore that Crewe Sharp was a "director" as defined in s 9 of the Corporations Act. The liquidators alleged that, as directors of Akron Roads, the third to sixth respondents breached s 588G(2) of the Corporations Act by failing to prevent Akron Roads from incurring debts while insolvent. Pursuant to s 588M(2) of the Corporations Act, the liquidators applied for an order that the third to sixth respondents pay, as a debt due to Akron Roads, an amount equal to the loss or damage suffered by Akron Roads' creditors as a result of Akron Roads' insolvent trading. In December 2013, Crewe Sharp claimed indemnity from CGU for any amount for which Crewe Sharp might be held liable to the liquidators. Mr Crewe was also an insured under the policy. CGU denied the claim on the basis, it was said, that the policy did not provide cover in respect of the claims made against Crewe Sharp. CGU has since also alleged non-disclosure as a basis for denying liability. Crewe Sharp was put into liquidation in June 2014 and the liquidators of Crewe Sharp immediately told the liquidators that it was unlikely that Nettle Crewe Sharp would be defending the proceeding. Since then, Crewe Sharp has not participated in the proceeding. The liquidators of Crewe Sharp and Mr Crewe did not file any cross- claims against CGU or, apart from asserting their claims in correspondence, indicate any intention of otherwise challenging CGU's denial of liability under the policy. It is not suggested, however, that the directors accept CGU's denial of liability. As at July 2011, Mr Crewe had net assets of about $1 million and, apart from the fact that he has not been declared bankrupt, there is no reason to think that he would have sufficient funds to meet the liquidators' claim of approximately $14.6 million. The ability of the fourth and fifth respondents to satisfy any judgment in favour of the liquidators is unknown. In August 2014, the liquidators applied to Judd J for an order pursuant to r 9.06(b) of the Supreme Court (General Civil Procedure) Rules 2005 (Vic) that CGU be joined as a defendant to the proceeding and for leave to file and serve amended points of claim seeking a declaration that "CGU is liable to indemnify [Mr Crewe and Crewe Sharp] in respect of any judgment herein obtained by the [liquidators] against [Mr Crewe and Crewe Sharp] and in respect of any sums (including legal costs) which the court may order [them] to pay to the [liquidators]". The liquidators based their application in relation to Crewe Sharp on the priority which s 562 of the Corporations Act would afford them in respect of any amount payable by CGU to Crewe Sharp under the insurance policy. In relation to Mr Crewe, the liquidators based their application on the fact that, if the claim succeeds and results in Mr Crewe being declared bankrupt, the liquidators will have priority under s 117 of the Bankruptcy Act 1966 (Cth) in respect of any amount payable by CGU to Mr Crewe under the policy. CGU opposed the application principally on the ground that the Court had no jurisdiction to grant the declaratory relief sought, or should decline to do so in the exercise of its discretion. The judgments below Judd J allowed the application. Despite CGU's submission that there was "a clear conflict of relevant authorities ... concerning the question of jurisdiction to grant declaratory relief in [such] a case"72, his Honour said that he found no reason to refuse the application. As he observed, there was a contest between the liquidators and CGU concerning CGU's liability to indemnify the directors. It 72 Akron Roads Pty Ltd (in liq) v Crewe Sharp [2015] VSC 34 at [18]. Nettle was unlikely that the joinder of CGU would prejudice the efficient and cost- effective management of the trial or disproportionately extend the length of the trial. The claim by the liquidators that CGU is bound to indemnify the directors arose out of or related to or was connected with the liquidators' claims against the directors. The liquidators had a sufficient interest in the proceeds of insurance to accord them standing to apply for the declaratory relief which they seek73. By reason of s 562 of the Corporations Act, there was a justiciable dispute consequent upon CGU's denial of liability under the policy. Accordingly, it was just and convenient that the dispute between the liquidators and CGU be resolved at the same time and in the same proceeding as the dispute between the liquidators and the directors. The Court of Appeal affirmed Judd J's reasoning74. Their Honours also rejected a further argument, which CGU advanced for the first time in the Court of Appeal, that the reasoning of the plurality in Ainsworth v Criminal Justice Commission75 dictated that the Court has no jurisdiction to grant declaratory relief at the suit of a stranger to a private contract concerning the meaning and effect of the contract. In so holding, the Court of Appeal eschewed doubts expressed by McLure P in QBE Insurance (Australia) Ltd v Lois Nominees Pty Ltd76 about the validity of the reasoning of the Full Court of the Federal Court of Australia in Employers Reinsurance Corporation v Ashmere Cove Pty Ltd77. Their Honours considered that McLure P's misgivings proceeded from a misinterpretation of some of the observations of Gaudron J in Truth About Motorways Pty Ltd v Macquarie Infrastructure Investment Management Ltd78. The Court of Appeal also distinguished an earlier decision of the Victorian Court of Appeal in C E Heath Casualty & General Insurance Ltd v Pyramid Building Society (In liq)79, on the basis that that case was decided on 73 Cf Kuczborski v Queensland (2014) 254 CLR 51 at 109-110 [187] per Crennan, Kiefel, Gageler and Keane JJ; [2014] HCA 46. 74 CGU Insurance Ltd v Blakeley (2015) 18 ANZ Insurance Cases ¶62-073. 75 (1992) 175 CLR 564 at 581-582 per Mason CJ, Dawson, Toohey and Gaudron JJ; [1992] HCA 10. 76 (2013) 17 ANZ Insurance Cases ¶61-949 at 73,100-73,101 [33]-[37]. 77 (2008) 166 FCR 398. 78 (2000) 200 CLR 591 at 611-612 [46]; [2000] HCA 11. Nettle discretionary grounds rather than as a matter of jurisdiction and, in any event, because it did not address the issue on which Ashmere Cove was decided. Jurisdiction In Ainsworth, the plurality stated that the power to grant declaratory relief is "confined by the considerations which mark out the boundaries of judicial power"80. Consequently, a party seeking declaratory relief must demonstrate a "real interest"81 in the subject matter of the declaration and it must be apparent that the declaration will be productive of foreseeable consequences for the parties. Relief will not be granted if the question is "purely hypothetical" in the sense that it is "claimed in relation to circumstances that [have] not occurred and might never happen"82. As the law has developed since Ainsworth, it is now apparent that there are also three further considerations relating to the jurisdiction to entertain a claim for declaratory relief in courts exercising federal jurisdiction. First, whether a claim for a declaration of liability constitutes a "matter" sufficient to attract federal jurisdiction is to be determined according to the "tripartite inquiry" adumbrated by Gaudron and Gummow JJ in Re McBain; Ex parte Australian Catholic Bishops Conference83 as follows: "[F]irst, the identification of the subject matter for determination ... secondly, the identification of the right, duty or liability to be established ... thirdly, the identification of the controversy between the parties ... for the quelling of which the judicial power of the Commonwealth is invoked". Secondly, it is not a requirement of a "matter" that the right, duty or liability exist as between opposing parties. As Gaudron and Gummow JJ stated in Re McBain84: 80 (1992) 175 CLR 564 at 582 per Mason CJ, Dawson, Toohey and Gaudron JJ. 81 (1992) 175 CLR 564 at 582. 82 (1992) 175 CLR 564 at 582, quoting University of New South Wales v Moorhouse (1975) 133 CLR 1 at 10 per Gibbs J; [1975] HCA 26. 83 (2002) 209 CLR 372 at 405-406 [62]; [2002] HCA 16. 84 (2002) 209 CLR 372 at 407 [67], quoting In re Judiciary and Navigation Acts (1921) 29 CLR 257 at 265; [1921] HCA 20. Nettle "[T]here is no general proposition respecting Ch III [of the Constitution] that the 'immediate right, duty or liability to be established by the determination of the Court' ... must be a right, duty or liability in which the opposing parties have correlative interests." Thirdly, where a claim that depends on non-federal law (here, the common law liability of CGU under the insurance policy) and a federal claim (here, the liquidators' claims against the directors under s 588M(2) of the Corporations Act) arise out of "common transactions and facts" or "a common substratum of facts", or where "the determination of one is essential to the determination of the other"85, the non-federal claim will be part of the federal matter and thus fall within "accrued" federal jurisdiction. Federal jurisdiction Before this Court, CGU contended that the Court of Appeal were wrong in holding that this case did not raise a question of federal jurisdiction and holding that the Ainsworth criteria were therefore inapplicable. The liquidators accepted that contention but nonetheless submitted that the Supreme Court had federal jurisdiction to entertain the claim for a declaration against CGU. Up to a point, CGU's contention may be accepted. Evidently, the Court of Appeal overlooked the significance of the fact that the issue between the liquidators and the directors is whether the directors are liable for breach of their duties under the Corporations Act. The issue between the liquidators and the directors is thus a matter "arising under"86 a law of the Commonwealth with the result that the Supreme Court's authority to decide the issue stems from the federal jurisdiction conferred on the Supreme Court by s 39(2) of the Judiciary Act 1903 (Cth)87. It follows that the Supreme Court's jurisdiction to decide the claim for declaratory relief against CGU depends on whether that claim comes within the concept of a "matter" within the meaning of s 39(2) of the Judiciary Act and thus within the meaning of Ch III of the Constitution. It does not follow, however, that the Supreme Court does not have federal jurisdiction to entertain the claim for a declaration. 85 Re Wakim; Ex parte McNally (1999) 198 CLR 511 at 585 [140] per Gummow and Hayne JJ; [1999] HCA 27, quoting Philip Morris Inc v Adam P Brown Male Fashions Pty Ltd (1981) 148 CLR 457 at 512 per Mason J; [1981] HCA 7. 86 Constitution, s 76(ii). 87 Felton v Mulligan (1971) 124 CLR 367 at 408 per Walsh J; [1971] HCA 39. See also Agtrack (NT) Pty Ltd v Hatfield (2005) 223 CLR 251 at 262 [29] per Gleeson CJ, McHugh, Gummow, Hayne and Heydon JJ; [2005] HCA 38; Edwards v Santos Ltd (2011) 242 CLR 421 at 438 [45] per Heydon J; [2011] HCA 8. Nettle Before this Court, CGU further contended that the Court of Appeal were in error in treating what were described as case management considerations as pertinent to jurisdiction. Counsel for CGU submitted that, although the liquidators may have a contingent financial interest in whether CGU is obligated to indemnify the directors in respect of the liquidators' claims, a declaration as to CGU's liability to indemnify the directors would not directly affect any property, legal right or obligation of the liquidators. For that reason, counsel submitted, there was no relevant justiciable controversy between the liquidators and the directors and accordingly no jurisdiction to grant the declaratory relief that is sought. That contention should be rejected. As the Full Court concluded in Ashmere Cove88, in a case of this kind the core of the justiciable controversy is the dispute between the liquidators and the directors. There is also a controversy between the directors and the insurer as to whether the insurer is liable to indemnify the directors against the liquidators' claims, which forms part of the single controversy arising out of the liquidators' claims against the directors. The success of the liquidators' claims against the directors is an essential prerequisite to the determination of any claim by the directors against the insurer. The liquidators' claim that the insurer is bound to indemnify the directors arises out of the same substratum of facts as the liquidators' claims against the directors. And the liquidators have a real interest in establishing that the insurer is liable to indemnify the directors. That is sufficient to comprise a justiciable controversy for the purposes of identifying a matter that attracts jurisdiction. The Court of Appeal were correct, too, to reject the doubts that McLure P expressed in QBE Insurance89 as to the rectitude of the approach in Ashmere Cove. With respect, her Honour attributed an unduly narrow meaning to the conception of "matter". As this Court held in Truth About Motorways90, it is not an essential feature of a matter that the parties to a claim share correlative rights, in the sense of reciprocal rights and obligations. CGU's submission that the lack of contractual privity between CGU and the liquidators deprived CGU and the liquidators of the character of adversaries (with the result that there was no justiciable controversy between them) requires separate consideration. To a large extent, it centred on an observation of Ormiston JA in C E Heath91 that it is not ordinarily appropriate to permit an 88 (2008) 166 FCR 398 at 410 [51]. 89 (2013) 17 ANZ Insurance Cases ¶61-949 at 73,100 [34]. 90 (2000) 200 CLR 591 at 637 [122] per Gummow J, 660 [183] per Hayne J. 91 [1997] 2 VR 256 at 270. Nettle outsider to seek declaratory relief regarding the meaning and effect of a contract about which the parties have not themselves raised any issue. Up to a point, that is correct. Ormiston JA's reservation about the impermissibility of allowing an outsider to seek a declaration about the meaning and effect of a contract to which the outsider is not party was based on the decision of the Court of Appeal of England and Wales in Meadows Indemnity Co Ltd v The Insurance Corporation of Ireland Plc92. In Meadows, it was held that the court below lacked jurisdiction to grant a declaration at the suit of a reinsurer that the insurer whose liability was the subject of the reinsurance was not liable to the insured. The decision was largely based on the speeches of Lord Wilberforce and Lord Diplock in Gouriet v Union of Post Office Workers93. In Gouriet, Lord Wilberforce said that declaratory relief cannot be granted unless94: "the plaintiff, in proper proceedings, in which there is a dispute between the plaintiff and the defendant concerning their legal respective rights or liabilities either asserts a legal right which is denied or threatened, or claims immunity from some claim of the defendant against him or claims that the defendant is infringing or threatens to infringe some public right so as to inflict special damage on the plaintiff." Lord Diplock stated that95: "The only kinds of rights with which courts of justice are concerned are legal rights; and a court of civil jurisdiction is concerned with legal rights only when the aid of the court is invoked by one party claiming a right against another party, to protect or enforce the right or to provide a remedy against that other party for infringement of it, or is invoked by either party to settle a dispute between them as to the existence or nature of the right claimed. So for the court to have jurisdiction to declare any legal right it must be one which is claimed by one of the parties as enforceable against an adverse party to the litigation, either as a subsisting right or as one which may come into existence in the future conditionally on the happening of an event." 92 [1989] 2 Lloyd's Rep 298. 94 [1978] AC 435 at 483. 95 [1978] AC 435 at 501. Nettle In Meadows, the Court of Appeal concluded that the reinsurer had no standing to claim the declarations sought because the reinsurer was not in a contractual relationship with the insured and because, although there was a connection between the contract of insurance and the contract of reinsurance, the reinsurer's "rights [were] in no way involved in the existing dispute between [the insurer] and [the insured]"96. The essence of the decision is encapsulated in May LJ's statement that97: to a contract has no "I accept the general submission that was made to us that a person not a in exceptional party circumstances, to obtain a declaration in respect of the rights of other parties to that particular contract. It would be contrary to the whole principle of privity to allow such a person to obtain such a declaration. He has no 'rights' in respect of that contract and has no claim for relief under locus, save perhaps Australian authority largely accords with Meadows. As was recognised in Meadows, however, there are exceptions. Generally speaking it may be correct to say that an outsider has no standing to seek a declaration about the meaning and effect of a contract to which the outsider is not party98. But that depends on what is meant by an "outsider" and upon the circumstances in which the parties to the contract have chosen, or been influenced, not to raise an issue. A plaintiff to whom s 562 of the Corporations Act or s 117 of the Bankruptcy Act gives a right to be paid in priority out of the proceeds of a policy of insurance against an insolvent defendant's liability to the plaintiff is not an "outsider" in any rational sense of the word. The conflict of authority In Interchase Corporation Ltd (in liq) v FAI General Insurance Co Ltd99, Byrne J reasoned that, although an insured defendant may sue on a policy of insurance, the plaintiff has no entitlement under general law or statute to enforce the defendant's claim against the insurer. Accordingly, since the declaration sought by the plaintiff related exclusively to the insurer's liability to the insured, it could not directly affect any property, legal right or obligation of the plaintiff. 96 [1989] 2 Lloyd's Rep 298 at 309. 97 [1989] 2 Lloyd's Rep 298 at 309. 98 See, eg, Wilson v Darling Island Stevedoring and Lighterage Co Ltd (1956) 95 CLR 43 at 67 per Fullagar J; [1956] HCA 8; Coulls v Bagot's Executor and Trustee Co Ltd (1967) 119 CLR 460 at 478 per Barwick CJ; [1967] HCA 3. 99 [2000] 2 Qd R 301 at 317-318. Nettle On that basis, his Honour held that the subject of the declaration would be theoretical100. By contrast, in Ashmere Cove Pty Ltd v Beekink (No 2)101, French J held at first instance, and the Full Court affirmed on appeal102, that, although s 562 of the Corporations Act does not confer a legal right on a plaintiff liquidator as against a defendant's insurer, it confers a right of priority in respect of the proceeds of any successful claim by the defendant against the insurer. That gives the plaintiff liquidator a "very real interest"103 in having the insurer's obligations to the defendant determined by way of declaration in the course of the proceeding in which the defendant's liability to the liquidator is determined. There are a number of reasons why the approach in Ashmere Cove is to be preferred. To begin with, Byrne J's reasoning in Interchase assumes that it was a condition of the power to grant declaratory relief that the declaration be determinative of an issue which directly affected property, a legal right or an obligation of the claimant. As has been seen, that is not the case. Depending upon the circumstances, it is sufficient that a claimant will derive some benefit or advantage from the declaration over and above any benefit or advantage that might be derived by an ordinary citizen104. Second, although it is true that declaratory relief will not ordinarily be granted in relation to circumstances that have not yet occurred and might never happen105, the liquidators' claim for a declaration is in relation to events which, 100 [2000] 2 Qd R 301 at 320-321. 101 (2007) 244 ALR 534 at 550 [59]. 102 Ashmere Cove (2008) 166 FCR 398. 103 Ashmere Cove Pty Ltd v Beekink (No 2) (2007) 244 ALR 534 at 550 [59]. See also Ainsworth (1992) 175 CLR 564 at 582; Kuczborski (2014) 254 CLR 51 at 61 [6] 104 Robinson v Western Australian Museum (1977) 138 CLR 283 at 327-328 per Mason J; [1977] HCA 46; Onus v Alcoa of Australia Ltd (1981) 149 CLR 27 at 35- 36 per Gibbs CJ, 71 per Brennan J; [1981] HCA 50; Wentworth v Woollahra Municipal Council (1982) 149 CLR 672 at 681 per Gibbs CJ, Mason, Murphy and Brennan JJ; [1982] HCA 41; Bateman's Bay Local Aboriginal Land Council v Aboriginal Community Benefit Fund Pty Ltd (1998) 194 CLR 247 at 264-267 [42]- [48] per Gaudron, Gummow and Kirby JJ; [1998] HCA 49. 105 Moorhouse (1975) 133 CLR 1 at 10 per Gibbs J. Nettle ex hypothesi, have occurred, namely, the directors' past breaches of s 588G of the Corporations Act. Third, although it may not be known until the conclusion of the trial whether the circumstances which afford the liquidators a right of priority in relation to the proceeds of the insurance policy have occurred, that is not to say that those events have not yet occurred. The purpose of allowing CGU to be joined as a defendant to the proceeding is so that the claim for a declaration may be determined at the same time as and on the basis of the same evidence as the liquidators' claims against the directors. Fourth, the issue in this case is not theoretical but, even if it were, the court does not lack jurisdiction to make a declaration concerning a theoretical issue, in the sense of an issue that does not presently exist but which is likely to arise in future, where the issue is productive of a real and pressing dispute, is of real practical importance or is one in which the claimant has a real commercial interest. Thus, for example, it is now well established that, where a claimant intends to take action which would subject him or her to a "theoretical" possibility of being subjected to legal process, the risk of being so subjected to that process is sufficient to ground standing to claim a declaration that the basis of the process (in that case, the offence) is invalid106 and, co-ordinately, that in such cases there is a matter upon which the court has jurisdiction to adjudicate107. Similarly, where a claimant has a real commercial interest in establishing the claimant's legal status or entitlement in relation to proposed commercial conduct and there is a real controversy with some contradictor as to the existence or extent of the claimant's legal status or entitlement, the claimant may have standing to obtain, and the court co-ordinately will have jurisdiction to grant, a declaration as to the existence or extent of the status or entitlement108. 106 Croome v Tasmania (1997) 191 CLR 119; [1997] HCA 5; Kuczborski (2014) 254 CLR 51 at 61 [6] per French CJ, 86-88 [96]-[100] per Hayne J, 106-108 [175]- [181] per Crennan, Kiefel, Gageler and Keane JJ, 132-133 [281]-[283] per Bell J. 107 The Commonwealth v Sterling Nicholas Duty Free Pty Ltd (1972) 126 CLR 297 at 305 per Barwick CJ; [1972] HCA 19; Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 355-357 [47]-[48]; [1999] HCA 9; Edwards (2011) 242 CLR 421 at 435 [37] per Heydon J; Kuczborski (2014) 254 CLR 51 at 59 [3] per French CJ. See also French, "Declarations: Homer Simpson's Remedy – Is There Anything They Cannot Do?", in Dharmananda and Papamatheos (eds), Perspectives on Declaratory Relief, (2009) 25 at 38. 108 Aussie Airlines Pty Ltd v Australian Airlines Ltd (1996) 68 FCR 406 at 415 per Lockhart J; Edwards (2011) 242 CLR 421 at 436 [38] per Heydon J. Nettle The declaration would be binding A further aspect of CGU's argument before this Court was to the effect that French J's and the Full Court's judgments in Ashmere Cove proceeded upon a misconception that, if a declaration of the kind sought were granted, the insurer would be estopped by operation of issue estoppel or the principle in Port of Melbourne Authority v Anshun Pty Ltd109 in any subsequent proceeding between the insured and the insurer from disputing the insurer's liability to indemnify the insured. In CGU's submission, the insurer would not be so estopped and therefore the declaration would not finally resolve the issue. It followed, CGU contended, that there is no jurisdiction to grant the declaration sought and further or alternatively that Judd J should have declined to join CGU in the exercise of his discretion because the declaration sought would be devoid of practical utility. That argument should be rejected. As the Court of Appeal observed, whether or not the declaration would, as a matter of res judicata, bind CGU from contesting its liability to the directors in any subsequent proceeding between the directors and CGU, it would be an abuse of process for CGU to deny liability in such proceedings. That is sufficient utility in itself to attract jurisdiction and to warrant the exercise of discretion in favour of granting a declaration. But in addition to that, and subject only to one procedural consideration to be mentioned later in these reasons, the declaration would, by operation of issue estoppel, preclude CGU from contesting its liability to the directors in any subsequent proceeding between CGU and the directors. If the directors had chosen to prosecute their own claim for indemnity against CGU by way of third party proceeding, the outcome of the third party claim would have been binding as between all parties to the proceeding110. Since the directors chose not to adopt that course, it is desirable and appropriate for the liquidators to adopt an alternative method of obtaining a determination of the issues that is binding on the directors and CGU. Arguably, that would not have been possible before r 9.06(b)(ii) of the General Rules of Procedure in Civil Proceedings 1986 (Vic) came into force111. The former provision was similar to O 15 r 6(2)(b) of the English Rules of the Supreme Court 1965 (UK) ("RSC") and, according to the meaning which was attributed to RSC O 15 r 6(2)(b) in In re Vandervell's Trusts112, CGU could not have been joined because its joinder 109 (1981) 147 CLR 589; [1981] HCA 45. 110 Sandtara Pty Ltd v Abigroup Ltd (1997) 42 NSWLR 5 at 8-9 per Gleeson CJ, Meagher and Handley JJA. 111 Cf Asher v London Film Productions Ltd [1944] KB 133 at 137-138 per Lord Greene MR. Nettle would not have been "necessary in order to enable the Court effectually and completely to adjudicate upon and settle all the questions involved in the cause or matter"113. But r 9.06(b)(ii) was introduced for the specific purpose of overcoming the limitations identified in Vandervell's case by allowing a party to be joined in order to determine any question arising out of, relating to or in connection with any claim in the proceeding which it is just and convenient to determine as between the joined party and a party to the proceeding as well as between the parties to the proceeding. And here it is just and convenient that CGU's liability to indemnify Crewe Sharp and Mr Crewe be determined in this proceeding as between all parties. CGU also invoked Byrne J's reasoning in Interchase to the effect that, although the joinder of an insured might make the insurer and the insured co- defendants, it would not make them adversaries. As Byrne J put it114: "The insurer asserts, and both insured appear content to accept, that [the insurer] was entitled to decline indemnity. Among them, there is no controversy. No procedural manoeuvre by [the plaintiff] can alter that state of affairs. ... So, even if [the insurer] remains [joined], the litigation is destined to conclude without making adversaries of the defendants among themselves. In short, the rights of the co-defendants inter se will not be determined in [the plaintiff's] action." That reasoning should also be rejected. It overlooks that while the directors are joined as defendants to the proceeding, in effect they stand in relation to the liquidators' claim for a declaration against CGU as co-plaintiffs with the liquidators. Their position is akin to that of a recalcitrant joint promisee that refuses to join with another joint promisee as plaintiffs in a proceeding against the promisor to enforce the promise. In such a case, the recalcitrant joint promisee may be joined as a defendant to the proceeding to ensure that he or she is bound by the determination. The same may occur where an equitable assignor of a legal chose in action refuses to join with the equitable assignee as a plaintiff in a proceeding against the obligor to enforce the chose in action. The assignor may be joined as a defendant in order to ensure that the assignor is bound vis-a- vis the obligor. As Lord Atkinson explained in Rodriguez v Speyer Brothers115, in such cases, although the joined party is joined as a defendant, the joined party is not a defendant in any true sense of the term, or at least not in the sense of one who has 113 General Rules of Procedure in Civil Proceedings 1985 (Vic), O 16 r 11. 114 [2000] 2 Qd R 301 at 317-318. 115 [1919] AC 59 at 103-104. Nettle to defend against a hostile claim. The plaintiff does not make a claim against the joined party. The purpose of the joinder is to make the joined party, in effect, a plaintiff against the joined party's will. The relief which the joined party gets is the relief to which a willing plaintiff would be entitled. The judgment is entered for the joined party as much as for the actual plaintiff. It does not matter that, but for the joinder, the controversy between the joined party and the existing defendant would have remained uncrystallised. The purpose of the exercise is, in effect, to ensure that the controversy is crystallised and dealt with at the same time as the other issues pertaining to the plaintiff's ability to recover from the original defendant116. Of course, there are differences between joint promisees, the parties to an equitable assignment and the liquidators in a case like this. In the case of joint promisees, each joint promisee has rights directly against the promisor and, in the case of an equitable assignment of a legal chose in action, the assignee's claim against the obligor derives from the assignor's legal rights against the obligor. The liquidators do not have that kind of claim. But, for present purposes, such differences are immaterial. The liquidators have a legal, albeit contingent, right to priority in relation to any amount found to be owed by CGU to the directors under the policy. And, in order to exercise their right of priority, it is necessary for them to obtain a determination which is binding as between CGU and the directors that CGU is liable to indemnify the directors. Accordingly, in the same way that it is appropriate and effective for a promisee to join a recalcitrant joint promisee as a defendant and thereby establish the joint promisees' claim against the promisor, and it is appropriate and effective for an equitable assignee to join the assignor to establish the assignee's claim against the obligor, it is appropriate and effective for the liquidators to join CGU in the one proceeding with the directors so that the directors' liability to the liquidators is determined at the same time as the issue of CGU's liability to the directors117. A similar result might have been achieved by the liquidators suing CGU for a declaration of CGU's liability to indemnify the directors and then joining the directors as additional defendants in order to ensure that CGU was bound by the determination of the directors' liability to the liquidators. The order in which they were joined, however, is irrelevant. As foreshadowed, there is one procedural aspect of the matter that should be attended to. Only parties to an issue can raise, or have raised against them, the 116 Cf Shrimp v Landmark Operations Ltd (2007) 163 FCR 510 at 527-528 [79]-[82]. 117 Barclays Bank v Tom [1923] 1 KB 221 at 223-224 per Scrutton LJ. Nettle doctrine of issue estoppel in relation to that issue118. In order to determine the parties to an issue, as opposed to the parties to a proceeding, it is sometimes necessary to look beyond the title to an action to identify against which person the relief is sought119. As this matter stands, the liquidators' points of claim express their claim for a declaration of CGU's liability to the directors as a claim made only as against CGU. To ensure that the directors are bound by any such declaration, and equally to ensure that the directors are entitled to assert the benefit of the declaration as against CGU120, the claim should be amended to put beyond doubt that it is a claim made against both CGU and the directors. Subject to that, it should be concluded that the liquidators' claim for a declaration of CGU's liability to the directors gives rise to a justiciable controversy. Because determination of that justiciable controversy depends on resolution of the directors' liability to Akron Roads under the Corporations Act, the justiciable controversy is within the same matter as the liquidators' claims against the directors. The claim for the declaration therefore comes within the Supreme Court's federal jurisdiction. Judd J and the Court of Appeal were right to hold that there is jurisdiction to grant the declaration that is sought. Discretionary considerations It remains to deal with three submissions regarding discretionary considerations on which CGU relied. The first pertained to Byrne J's characterisation of the process of a plaintiff joining a potentially insolvent defendant's insurer as a "manoeuvre"121. That aspect of Byrne J's reasoning was directed to different circumstances from those in this case. Accordingly, whether or not it is correct, it is distinguishable. Here, the liquidators' joinder of CGU as a defendant and claim for a declaration of CGU's liability to indemnify the directors should not be conceived of as a "manoeuvre" in any pejorative sense of that term. The joinder is designed to overcome the kinds of manoeuvres which are sometimes employed by parties in CGU's position – to delay and deter the final adjudication of liability – by ensuring that all issues are dealt with at once in the one proceeding in a manner that binds all parties to the proceeding122. As the Court of Appeal 118 Spencer Bower and Handley, Res Judicata, 4th ed (2009) at 128 [9.08]. 119 See Taylor v Ansett Transport Industries Ltd (1987) 18 FCR 342 at 357 per Fisher J, quoting Cross on Evidence, 3rd Aust ed (1986) at 124. 120 Sandtara (1997) 42 NSWLR 5 at 8-9. 121 Interchase [2000] 2 Qd R 301 at 318. 122 Cf Asher v Environment Secretary [1974] Ch 208 at 222 per Lord Denning MR. Nettle said, it would disaccord with contemporary imperatives of cost-effective and efficient judicial management of commercial litigation for the Supreme Court not to do as much as it can to ensure that issues which are common to parties are determined once and for all in the one proceeding. That is the purpose of Pt 4.2 of the Civil Procedure Act 2010 (Vic). Granted, declaratory relief will not be granted if a question is "purely hypothetical" or if relief is claimed in relation to circumstances which have not occurred and might never happen123. But, in this case, as has been explained, the issue is not hypothetical. The object of joining CGU as a defendant is to enable the question of CGU's liability to indemnify the directors to be determined at the same time as the directors' liability to the liquidators. When and if the Supreme Court makes a declaration that CGU is liable to indemnify the directors against their liabilities to the liquidators, it will be because the Court has determined that the directors are liable to the liquidators. The second submission concerned the circumstances that attend the claim that CGU is liable to indemnify Crewe Sharp and the circumstances that attend the claim that CGU is liable to indemnify Mr Crewe. Crewe Sharp is in liquidation whereas Mr Crewe has not been declared bankrupt and may not be. the difference between It may be accepted that there is that difference. But whether Mr Crewe is declared bankrupt is likely to depend on whether the liquidators succeed in their claim against him. If they do, the evidence suggests that he will not have sufficient assets to meet their claim and that he will be declared bankrupt. In those circumstances, the fact that it is not yet clear whether final orders will be required is not a sufficient discretionary consideration to forgo the chance of having the liability of CGU to indemnify Mr Crewe in respect of his liability to the liquidators determined. The trial judge will be able to see more clearly at trial whether the claim under s 117 of the Bankruptcy Act is something which is likely to occur. And it may be assumed that the trial judge will not grant any relief against CGU in respect of its liability to Mr Crewe until and unless the necessary facts are established. It might also be open to the trial judge (if the trial judge thought it appropriate to do so) to defer making a declaration against CGU in respect of Mr Crewe until after the liquidators had obtained a sequestration order Finally, CGU stressed that it was unlikely that the directors would take an active part in the proceeding and it submitted that, because CGU has pleaded non-disclosure defences, it is impossible to assess the extent to which CGU would be estopped in any subsequent proceeding. But the short answer to those 123 Ainsworth (1992) 175 CLR 564 at 582; Bass (1999) 198 CLR 334 at 357 [49]. Nettle concerns is that it is up to the directors, and perhaps also up to CGU in the exercise of its rights under the policy, whether the directors participate in the proceeding. Hence, regardless of whether the directors choose to participate, there is no reason why the issues as between the liquidators and the directors and as between the directors and CGU cannot be determined once and for all in this proceeding, or why the outcome should not be regarded as binding on CGU. As a party to the proceeding that is potentially affected by the outcome of the liquidators' claims against the directors, CGU will have every right itself to defend the liquidators' claims against the directors124 as well as defending the liquidators' claim against CGU. Conclusion In the result, the appeal should be dismissed. 124 Barclays Bank v Tom [1923] 1 KB 221 at 224-225.

HIGH COURT OF AUSTRALIA SAAP & ANOR AND APPELLANTS MINISTER FOR IMMIGRATION AND MULTICULTURAL AND INDIGENOUS AFFAIRS & ANOR RESPONDENTS SAAP v Minister for Immigration and Multicultural and Indigenous Affairs [2005] HCA 24 18 May 2005 ORDER Appeal allowed with costs. Set aside the order of the Full Court of the Federal Court of Australia made on 11 December 2002 and, in its place, order: appeal allowed with costs; set aside the orders of Mansfield J made on 10 May 2002 and, in their place, order that: there be an order in the nature of certiorari to quash the decision of the Refugee Review Tribunal ("the Tribunal") made on 18 October 2001; there be an order in the nature of mandamus requiring the Tribunal to review according to law the decision made by a delegate of the Minister on 19 June 2001 to refuse protection visas sought by the applicants; (iii) the respondent pay the applicants' costs. On appeal from the Federal Court of Australia Representation: B R M Hayes QC with M S Blumberg for the appellants (instructed by Bourne Lawyers) J Basten QC with S J Maharaj for the first respondent (instructed by Sparke Helmore) No appearance for the second respondent Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS SAAP & Anor v Minister for Immigration and Multicultural and Indigenous Affairs Immigration – Refugees – Decision of Refugee Review Tribunal ("Tribunal") – Tribunal invited the first appellant to appear to give evidence and present arguments under Migration Act 1958 (Cth), s 425 – Evidence was later taken from first appellant's daughter in absence of first appellant – Tribunal affirmed decision under review by relying on information obtained from first appellant's daughter – Tribunal failed to give the first appellant particulars in writing of information – Tribunal failed to invite the first appellant in writing to comment on information – Whether Tribunal breached Migration Act, s 424A. Immigration – Construction of Migration Act, s 424A – Whether the provisions of Pt 7 Div 4 have sequential or ambulatory operation – Relevance of Refugee Convention in case of ambiguity. Immigration – Jurisdictional error – Whether a breach of Migration Act, s 424A amounts to jurisdictional error that invalidates the decision. Immigration – Procedural fairness – General law – Whether Tribunal breached rules of procedural fairness. Administrative Law (Cth) – Certiorari – Mandamus – Jurisdictional error – Whether grant of relief should be withheld on discretionary grounds – Relevant factors – Judiciary Act 1903 (Cth), s 39B. Practice – Joinder of party – Tribunal was not named as a party for the relief sought under Judiciary Act, s 39B – Whether the Tribunal was a necessary party to the proceedings – "officer or officers of the Commonwealth" – Judiciary Act, s Judiciary Act 1903 (Cth), s 39B. Migration Act 1958 (Cth), ss 424A, 425. GLEESON CJ. Part 7 of the Migration Act 1958 (Cth) ("the Act") provides for administrative review of protection visa decisions by the second respondent, the Refugee Review Tribunal ("the Tribunal")1. The decisions subject to potential review, which include a refusal to grant a protection visa on the ground that a non-citizen is not a refugee within the meaning of the Act and the international instruments by reference to which the Act operates, are commonly made by a delegate of the first respondent, the Minister for Immigration and Multicultural and Indigenous Affairs ("the Minister"). Section 414, which is in Div 2 of Pt 7, provides that, if a valid application for review of a decision is made, the Tribunal must review the decision. Pursuant to s 415, the Tribunal may affirm the decision, vary it, remit it for re-consideration, or set it aside and substitute a new decision. Section 420, which is in Div 3 of Pt 7, deals with the Tribunal's "way of operating", which is to be fair, just, economical, informal and quick. The Tribunal is not bound by legal technicalities and forms, and is to act according to substantial justice and the merits of the case. Division 4 of Pt 7 deals with the conduct of a review. Section 423 prescribes the procedure to be followed after an application for review has been lodged. As a result of the lodging of the application, the Registrar of the Tribunal will have been furnished with the findings of the original decision- maker, a statement of the evidence on which the findings were based, and a statement of the reasons for the decision (s 418). Under s 423, the applicant may provide the Registrar with a statutory declaration in relation to any matter of fact that the applicant wishes the Tribunal to consider, and written argument about the issues. The Secretary of the Minister's Department may give the Registrar written argument about the issues. Section 425 obliges the Tribunal to invite the applicant to appear before the Tribunal to give evidence and present arguments relating to the issues. That requirement is subject to certain exceptions that did not apply in the present case, but that are relevant to a question of construction that arises. Section 429 provides that what it describes as the hearing of an application for review must be in private. Division 5 of Pt 7 deals with the manner in which the Tribunal is to record and publish its decisions. Within that framework, Div 4 of Pt 7 contains certain other provisions relating to the conduct of the review. It has been noted that s 423 provides for the applicant to submit evidence as to matters of fact, and written argument, and also for the Secretary to submit written argument, and s 425 provides for the applicant to be invited to appear before the Tribunal, give evidence, and present argument. Between ss 423 and 425 there are four sections dealing with "information" and "comments on information". 1 References are to the form of the Act in September 2001, when the Tribunal hearing in the present case occurred. Section 424 confers on the Tribunal a general power to "get any information that it considers relevant". If the Tribunal gets such information, it must have regard to it. In particular, the Tribunal may invite a person to give "additional information", which must mean information additional to that already obtained under s 418, or provided under s 423. Section 424A obliges the Tribunal to give the applicant, in the way the Tribunal considers appropriate, particulars of any information that the Tribunal considers would be the reason, or part of the reason, for affirming the decision under review, to ensure, as far as reasonably practicable, that the applicant understands why it is relevant, and to invite the applicant to comment on it (s 424A(1)). The information and invitation must be given by a prescribed method, involving handing, or sending, to the applicant, by post or other specified form of communication, a document (s 424A(2)). Section 424A does not apply to certain kinds of information, being information that is not specifically about an applicant, or information that the applicant gave for the purpose of the application, or non-disclosable information (s 424A(3)). There have been some uncertainties about the precise scope of that qualification, but they are not presently relevant. It is s 424A(2) that is of particular relevance in this case. Section 424B deals further with the manner and form of inviting additional information under s 424, or comment on information under s 424A. Those provisions are relatively flexible. The invitee, who may or may not be the applicant, may or may not be invited to give the information, or make the comments, at an interview, and a procedure for fixing time limits is established. Section 424C deals with the consequences of failure to comply with the time limits. It empowers the Tribunal to proceed with its decision-making process without the information or the comments. Section 425 requires the Tribunal to invite the applicant to appear before the Tribunal. That requirement is subject to exceptions. One exception is where the applicant consents to the decision being made without the applicant appearing before the Tribunal (s 425(2)(b)). Another is where s 424C applies to the applicant. There is also an exception if the Tribunal considers that it should find in favour of the applicant on the material before it. It will be necessary to return to those exceptions. Section 426 entitles the applicant to notify the Tribunal that the applicant wants the Tribunal to obtain evidence from some other person or persons. The Tribunal is empowered, by s 427, to take evidence on oath or affirmation, adjourn the review from time to time, and summon witnesses. Another person may be authorised by the Tribunal to take evidence (s 428). Oral evidence for the purposes of a review may be taken by telephone, closed circuit television, or any other means of communication (s 429A). As already noted, the hearing of an application for review must be in private (s 429). What is described in s 429 as the hearing is to be understood in the wider statutory context. The prescribed procedure is not that of adversarial litigation, with evidence taken and issues debated at a climactic trial. Indeed, in many cases there will not be a hearing. The procedure is administrative and inquisitorial. Even so, the statutory references to appearance and hearing, adjournment, summoning witnesses, taking evidence, and proceeding to decision in default of appearance, show that this is a form of administrative decision-making which, having the capacity to affect human rights, borrows from judicial procedure. While it is true that fairness in administrative decision-making is not measured by reference to a judicial paradigm, judicial procedure ought to be an example of fairness in action, and it is not surprising to find some aspects of that procedure taken up for some administrative purposes. The problem in the present appeal arises out of an alleged failure on the part of the Tribunal to comply with the requirements of s 424A, in particular, s 424A(2). The essential facts may be stated briefly. The first appellant, who at different times was represented by a solicitor and a migration adviser, applied to the Tribunal for review of an unfavourable decision by a delegate. She was in immigration detention. A hearing of her application took place on 5 September 2001. The proceedings were conducted by video-link between Sydney and Woomera Hospital. The Tribunal Member was in Sydney, together with the first appellant's migration adviser, an interpreter, one of the first appellant's daughters, and other witnesses. The first appellant was at Woomera. Since the issue in the case is procedural, it is unnecessary to go into the substance of the first appellant's claims for refugee status. At one point in the proceedings, the Tribunal Member took evidence in Sydney from the first appellant's daughter. After the daughter's evidence was given, the Tribunal Member raised with the first appellant, for her comment, three particular matters about which the daughter had given evidence. For reasons that need not be examined, those matters were potentially adverse to the first appellant's case. The first appellant made her response to each matter. The first appellant's migration adviser heard the daughter's evidence, the Tribunal Member's questions to the first appellant, and the first appellant's responses. The Tribunal Member then brought the hearing to a close, leaving it open to the first appellant or her migration adviser to make further oral or written submissions. No further submissions were made, but the migration adviser wrote to the Tribunal asking for a prompt decision because of the state of the first appellant's health. A decision was then given. It was unfavourable to the first appellant. The alleged failure to comply with s 424A arose from the circumstance that the Tribunal Member did not give the first appellant written notification of the three matters on which he invited comment, but dealt with the matter orally, at the hearing, in the manner described above. Two things should be noted. The first is that the first appellant is illiterate. For her, writing is not a useful medium of communication, especially if it is in the English language, unless she is given the opportunity to have someone orally explain the writing to her. Furthermore, the first appellant's migration adviser evidently considered that there was nothing more that could usefully be said by way of comment on the matters raised by the Tribunal Member following the daughter's evidence. In the Federal Court, Mansfield J held that there had been no failure to accord procedural fairness to the first appellant. He said that the first appellant was made aware of the nature and possible significance of her daughter's evidence and had a fair opportunity to comment on it, both during the hearing or later by further submissions had that been desired. He held that there had been a failure to comply with s 424A because the Tribunal had not given the first appellant written particulars of the information obtained from the daughter, but the failure had not deprived the first appellant of any opportunity to learn of material adverse to her claim, or comment on it. He therefore, in the exercise of what he saw as his discretion, declined to grant relief2. The Full Court of the Federal Court (Heerey, Moore and Kiefel JJ) dismissed an appeal3. In the Full Court, the principal issue was whether non-compliance with s 424A involved jurisdictional error. The Full Court's decision was given before the decision of this Court in Plaintiff S157/2002 v Commonwealth4. In this Court the main focus of attention in argument was whether, on the true construction of the Act, s 424A established an inviolable procedural requirement, compliance with which was essential to the validity of a Tribunal decision. If it was, the first appellant argued, it was beside the point to say that there was no procedural unfairness, and the primary judge had no discretion to decline relief. The reasons given by Mansfield J for concluding that there was no want of procedural fairness are compelling. No successful challenge has been made to that aspect of his Honour's decision, which was accepted by the Full Court. However, in this Court the first respondent challenged the acceptance, both by Mansfield J and the Full Court, of the proposition that there had been a contravention of a requirement of s 424A. The basis of this challenge was that s 424A did not speak to the circumstances that existed at the hearing, and it was the rules of procedural fairness, not s 424A, that governed the conduct of the Tribunal Member in those circumstances. The competing view, accepted by 2 SAAP v Minister for Immigration & Multicultural & Indigenous Affairs [2002] FCA 577. 3 SAAP of 2001 v Minister for Immigration & Multicultural & Indigenous Affairs [2002] FCAFC 411. (2003) 211 CLR 476. Mansfield J and the Full Court, is that s 424A operates before, during and after a hearing, and must be complied with if the situation it addresses arises at any time from the making of the application for review up to the final decision. It is common ground between the parties that the rules of procedural fairness apply to the conduct of a hearing by the Tribunal. As to whether s 424A also applies, the first respondent submits that the structure of Div 4 of Pt 7 supports a view that s 424A(2) was not intended to operate during the hearing. The very inflexibility of s 424A, upon which the appellants rely, and the mandatory terms in which s 424A(2) is cast, at least give reason to pause before concluding that the section applies to information that emerges during the hearing contemplated by ss 425, 425A, 427, 429 and 429A, being information upon which, as part of the process of hearing, the applicant can be, and is, fairly invited to comment. The applicant and the decision-maker are While what is contemplated by s 425 is not a trial, it is a proceeding for the purpose of allowing the applicant to give evidence and present arguments. It is governed by the rules of procedural fairness. Applicants may be represented by lawyers or advisers, or they may be unrepresented. Witnesses may be called in direct and examined. communication. Provided fairness is observed, why would there be imposed, at that stage, as an inflexible requirement, that the Tribunal hand or deliver to the applicant a document containing a written invitation to comment on potentially adverse information? Provided fairness is observed, why should not the Tribunal orally invite comment then and there? Suppose, for example, that an applicant's case is that he fled from a certain country because he was being persecuted for political reasons. Suppose that, at the hearing, a witness gives evidence that the applicant told the witness he had never been to that country in his life. Obviously, fairness requires that the Tribunal give the applicant an opportunity to comment on that evidence. Why would there be an inflexible requirement to hand the applicant, at the hearing, a piece of paper referring to the evidence and inviting him to comment, even if the applicant is represented by a lawyer, clearly understands what is involved, and is able to deal with the issue then and there? Of course, there may be circumstances where fairness would require an adjournment, an explanation (perhaps a written explanation) of what is involved, and an opportunity to seek advice, or obtain rebutting evidence. That is not the point. The question is whether, regardless of whether fairness requires it, s 424A operates at that stage. The structure of Div 4 of Pt 7 supports the first respondent's argument. Section 424A is one of a series of provisions located between the initial presentation of written evidence and argument by the applicant and written argument by the Secretary, and the hearing (s 425). It follows s 424, which empowers the Tribunal to seek additional information. It relates to inviting comment from the applicant on potentially adverse information. If the applicant fails to comment, the Tribunal may proceed to make a decision (s 424C). The way in which the Tribunal does that is governed by s 425 and the following provisions, which, in cases where a hearing is required by the legislation, deal with the hearing. The question whether there is to be a hearing pursuant to s 425 is likely to be affected by what has already occurred under s 424A. No hearing is necessary if the Tribunal is in favour of the applicant on the basis of the material before it (s 425(2)(a)). That material may include comments provided in response to the s 424A invitation. Nor is a hearing necessary if the applicant, having been invited to comment under s 424A, fails to make the comment within the stipulated time (s 425(2)(c)). The need for a hearing under s 425 will be governed in many cases by whether or not the applicant has responded within time to the s 424A invitation, and by the substance of any response. Furthermore, the purpose of the s 425 hearing is to receive evidence and arguments relating to the issues arising in relation to the decision under review. Those issues will often be influenced by the applicant's comments in response to a s 424A invitation. Further support for the first respondent's argument comes from a consideration of the detail of s 424A(2). Although the present case concerns an applicant who was in immigration detention, an applicant might be present at the hearing room, face to face with the Tribunal, perhaps accompanied by a lawyer or a migration adviser. Section 424A(2) requires that the information and invitation of which it speaks must be given to the applicant by one of the methods specified in s 441A. Section 441A specifies four methods of giving documents: first, by handing the document to the recipient; secondly, by handing a document to a person, apparently over the age of 16, at the applicant's last residential or business address; thirdly, by dispatch by prepaid post; fourthly, by electronic transmission. Plainly, the second, third and fourth of those methods would be absurd during a hearing at which the applicant was present. An inflexible requirement for the Tribunal to prepare and hand-deliver a document to an applicant at a hearing appears surprising. Where s 424A operates, the invitation to comment must specify the time, place and form of the comment. Presumably, where there is no unfairness involved, the Tribunal could invite comment, orally, at the hearing. Why should such an invitation be in writing? Provided the invitation is given fairly and clearly, the requirement of writing appears superfluous, especially in cases where fairness does not require an adjournment of the hearing. All this is occurring in the context of a mechanism for review that is supposed to be fair, just, economical, informal and quick, before a Tribunal which is not bound by technicalities or legal forms (s 420). It is agreed on all sides that the hearing contemplated by s 425 is not a trial. Subject always to the overriding requirement of procedural fairness, the object of the occasion is to hear evidence and receive arguments in the most useful and efficient manner. This will often involve flexibility in the order of proceedings. There seems to be an incongruity in the intrusion of an inflexible requirement for written communication at a "hearing". The incongruity is heightened in a case such as the present where any such written communication would require oral translation and explanation. Such a case would not be unusual. No doubt many applicants who can read and write in a language other than English cannot read English. Presumably, on the appellants' argument, what the Tribunal should have done was prepare a letter to the first appellant, fax it to Woomera, then have it translated orally by the interpreter. Having done that, on the findings in the Federal Court about fairness, the Tribunal could then have proceeded as it did. On those findings, the letter would have been pointless. That, indeed, is why the Federal Court decided the case as it did. But there is a less complicated path to the same conclusion. The above considerations, in combination, lead me to the conclusion that s 424A did not speak to the circumstances that arose in the present case, and that the case was governed by the rules of procedural fairness, not by s 424A. The appeal should be dismissed with costs. McHugh 24 McHUGH J. This is an appeal against an order of the Full Court of the Federal Court of Australia (Heerey, Moore and Kiefel JJ)5 upholding an order of a judge of that Court declaring that the Refugee Review Tribunal ("the Tribunal") had not erred in dismissing the appellants' claim for protection visas. The first issue in the appeal is whether the Tribunal breached s 424A of the Migration Act 1958 (Cth) ("the Act"). That section requires the Tribunal to give an applicant particulars in writing of any information that the Tribunal considers would be the reason, or a part of the reason, for affirming the decision that is under review. It also requires the Tribunal to ensure, as far as is reasonably practicable, that the applicant understands why it is relevant to the review and to invite the applicant to comment on it. Alternatively to the s 424A issue is a second issue. Did the Tribunal breach the rules of procedural fairness? If a breach of s 424A or the rules of procedural fairness occurred, a third issue is whether the breach gave rise to a jurisdictional error on the part of the Tribunal, such that the decision of the Tribunal is invalid. A final issue is whether there are any grounds for withholding discretionary relief under s 39B of the Judiciary Act 1903 (Cth) ("the Judiciary Act"). In my opinion, the Tribunal failed to comply with s 424A of the Act in the circumstances of the case. That breach gave rise to jurisdictional error on the part of the Tribunal, with the result that the decision of the Tribunal was invalid. Further, there is no reason to withhold discretionary relief under s 39B of the Judiciary Act. Statement of the case The appellants lodged applications under the Act for protection visas. The second appellant sought a protection visa solely because she is a member of the family of the first appellant. She did not herself have a claim to be a refugee. The first appellant claimed to have suffered persecution in Iran at the hands of the Muslim majority, including the police. However, a delegate of the Minister for Immigration and Multicultural and Indigenous Affairs, the first respondent, refused to grant protection visas. The appellants applied to the Tribunal for a review of the decision of the delegate. But their application was refused by the Tribunal which affirmed the decision of the Minister's delegate not to grant the protection visas. The Tribunal made adverse findings about the first appellant's credibility and rejected the key elements of her claims. The Tribunal declared that it was not satisfied that the harm, discrimination and harassment that she and her family had experienced in Iran, either individually or cumulatively, were sufficiently serious to amount to persecution under the Convention relating to the SAAP of 2001 v Minister for Immigration and Multicultural and Indigenous Affairs [2002] FCAFC 411. McHugh Status of Refugees6 as amended by the Protocol relating to the Status of Refugees7. The appellants then applied to the Federal Court for a review of the Tribunal decision. Mansfield J, who heard the application8, found that the Tribunal had failed to comply with s 424A of the Act on two grounds. First, it failed to give the first appellant particulars in writing of the information obtained from her eldest daughter, information which it considered would be part of the reason for affirming the decision of the Minister's delegate. Secondly, it failed to invite the first appellant to comment on that information9. However, his Honour held that the failure to comply with s 424A did not deprive the first appellant of the opportunity to learn of material adverse to her claim or to comment upon it. This was because, "[i]n practical terms, [the first appellant] has had the opportunity which s 424A is intended to provide."10 The first appellant learnt of her eldest daughter's evidence because her migration agent was present when the daughter gave her evidence and also because the Tribunal member asked the first appellant about certain aspects of that evidence and invited her response. The first appellant was also given the opportunity to make submissions about that information. Mansfield J also found that the Tribunal had not breached the common law rules of procedural fairness. He said the first appellant "had an opportunity to put her case, and was aware of the matters which were of significance to her case which emerged from the evidence of her eldest daughter. She also had an opportunity of responding to those matters, partly by what was put to her during the hearing and partly by being able to make submissions about those matters following the hearing"11. The appellants appealed to the Full Court of the Federal Court. Before the Full Court, the Minister did not dispute Mansfield J's finding that the Tribunal failed to comply with s 424A. But in a unanimous decision delivered in 6 Done at Geneva, on 28 July 1951 (1954 ATS 5). 7 Done at New York, on 31 January 1967 (1973 ATS 37). 8 SAAP v Minister for Immigration and Multicultural and Indigenous Affairs [2002] FCA 577. 9 SAAP [2002] FCA 577 at [32]-[33], [45]. 10 SAAP [2002] FCA 577 at [46]. 11 SAAP [2002] FCA 577 at [43]. McHugh December 2002, Heerey, Moore and Kiefel JJ dismissed the appeal12. Their Honours rejected the argument that the procedural step contemplated by s 424A preceded, and was essential to, the exercise by the Tribunal of the statutory power to determine the application for review13. Accordingly, they found that no jurisdictional error had occurred. Subsequently, this Court granted the appellants special leave to appeal. The material facts The appellants are Iranian citizens. The first appellant is the mother of the second appellant. The appellants arrived in Australia from Iran in March 2001. The first appellant left her husband, two sons and another daughter in Iran. The first appellant's eldest daughter had arrived in Australia before her mother and sister and was granted a protection visa. The appellants are followers of the ancient, pre-Christian Sabian-Mandean faith. Sabian-Mandeans form one of the smallest religious minorities in Iran. It is estimated that there are between 5,000 and 25,000 adherents in that country. The first appellant is illiterate and speaks very little English. A migration adviser represented the first appellant at the Tribunal hearing. While the first appellant was in Woomera Hospital, the migration adviser, the interpreter and the Tribunal member were in Sydney. Based upon the submissions of the migration agent, the Tribunal identified three incidents that the first appellant relied on to support her claim that Sabian-Mandeans are subject to harassment and discrimination in Iran. She said that her husband lost the sight of an eye when he was struck by a rock thrown by a group of Muslims during a religious ceremony. On another occasion, the Iranian authorities had attempted to abduct her eldest daughter with a view to forcibly converting her to Islam. Her children were refused admission to school and the second appellant was expelled from school after only six months. When the authorities discovered that the appellant was working as a hairdresser, she was dismissed from that employment and the hairdressing salon was burnt down. She claimed that Sabian-Mandeans were not allowed to work as hairdressers because they might come in contact with Muslims and would be suspected of spying on Muslim clients. When the hearing commenced, the Tribunal member said that he would advise the first appellant of information that he considered might be adverse to her claim and would give her an opportunity to comment on it. The first 12 SAAP of 2001 [2002] FCAFC 411. 13 SAAP of 2001 [2002] FCAFC 411 at [22]. McHugh appellant then called two witnesses to give evidence. Ms Susan Naghdi, the eldest daughter of the first appellant, was present at the hearing in Sydney. The first appellant did not propose to call her to give evidence. After the witnesses had given evidence, the Tribunal member decided to take evidence from the eldest daughter, in the absence of the first appellant. He asked the first appellant to leave the room in Woomera while he took this evidence. The migration adviser and the first appellant did not object to Ms Naghdi giving evidence. At this point, the first appellant had not given evidence but the Tribunal had before it earlier interviews with her. The migration adviser remained in the hearing room in Sydney while Ms Naghdi gave evidence. When the first appellant returned to the video hook-up room in Woomera, the Tribunal member put three aspects of Ms Naghdi's evidence to her. These related to the date when the first appellant's husband lost the sight of his eye, the circumstances of the attempt or attempts to abduct and convert Ms Naghdi to Islam and the attendance of the first appellant's children at school. In relation to the first and third matters (the timing of the incident when the first appellant's husband lost the sight of his eye and the children's attendance at school), the Tribunal member told the first appellant what Ms Naghdi had said and asked for a response. The Tribunal member did not tell the first appellant what Ms Naghdi had said in relation to the attempted abduction, although he questioned her about the matter. The Tribunal member did not explain the relevance to the review of the aspects of Ms Naghdi's evidence that he raised with the first appellant. Indeed, the interpreter suggested at one point that the first appellant would not be able to cope with the Tribunal member's statement that he had just taken evidence from Ms Naghdi and there were "three incidents that have been raised on [the first appellant's] behalf as bases for [her] claim for protection." The Tribunal member's response was: "All right. I'll summarise it. Your daughter has just given evidence to me. There are three matters I wanted to raise with you." At the conclusion of the hearing, the Tribunal member said: "I won't ask you any further questions about that but I may ask your adviser to inform me further. We do have to close the hearing now. Doctor, in view of the time, we have to adjourn now because the room is being used by another client. I have no further questions. Could I suggest that we adjourn the matter. I'm prepared to close the hearing now and receive written submissions, unless you want especially to make oral submissions. I'm happy to arrange another hearing time to receive oral submissions but in the circumstances I would prefer written submissions and I'd write to you indicating what matters I'd like to hear first. … I will be giving close consideration to everything you've raised and I'll be talking with your adviser about other aspects of your case I need to hear about. I know it's been very stressful for you and you're going McHugh through a difficult time. I'll be trying to make a decision quickly in your case." The first appellant did not seek to make any further oral submissions at the hearing. After the hearing had concluded the Tribunal member did not issue a written invitation to the first appellant to make further written submissions. The Tribunal relied on the information obtained from the evidence given by the eldest daughter at the hearing as a reason to affirm the decision under review. In particular, the Tribunal found that the first appellant had not established her claim that her eldest daughter and her other children had been refused admission to a school and deprived of an education. The Tribunal accepted the evidence of Ms Naghdi that the children had attended school, but had not progressed to higher education because they would have been required to study Islam. The Tribunal was also not satisfied that the problems experienced by the first appellant were sufficiently serious to amount to persecution. For example, the Tribunal was not satisfied that the first appellant had a genuine fear of persecution because of her religion or any imputed political opinion arising from her employment as a hairdresser, or that there was a real chance she would suffer persecution for those reasons if she returned to Iran14. The issues before this Court This appeal raises four specific issues: 1. Whether the Tribunal was obliged under s 424A to give the first appellant written particulars of the information it had obtained from the evidence of the eldest daughter in circumstances where the Tribunal considered that the information would be the reason or part of the reason for affirming the decision under review. If no breach of s 424A is established, whether the Tribunal failed to accord the appellants procedural fairness under the general law. 3. Whether, if breach of either s 424A or the general law obligation to accord procedural fairness is established, the decision of the Tribunal is affected by jurisdictional error such as to invalidate the decision and to permit the grant of relief. 4. Whether the grant of relief under s 39B of the Judiciary Act should be withheld on discretionary grounds. 14 See SAAP of 2001 [2002] FCAFC 411 at [7]-[8]. McHugh The parties' contentions The appellants submit that the failure to comply with s 424A of the Act constitutes jurisdictional error. In particular, the appellants submit that s 424A imposes an inviolable limitation or restraint upon the exercise of jurisdiction by the Tribunal. The appellants allege that in the circumstances of the case the Tribunal failed to observe the requirements of s 424A that written notice be provided to the appellants in respect of the evidence given by Ms Naghdi. This failure entailed jurisdictional error with the result that an application for constitutional writs was said to lie under s 39B of the Judiciary Act. In the alternative, the appellants submit that the Tribunal failed to observe the common law requirements of procedural fairness. Such failure, according to their submission, necessarily entailed jurisdictional error and thus attracted s 39B of the Judiciary Act. The Minister submits that s 424A does not require the Tribunal to give information and an invitation in writing in all circumstances. Alternatively, she contends that s 424A does not apply in relation to information obtained by the Tribunal when the applicant has been invited to appear before the Tribunal to give evidence and present arguments. If it is found that s 424A operates at such a time and in fact requires the giving of the information in writing, she contends that the failure to do so in this case does not amount to jurisdictional error. On the Minister's submission, there is no reason to infer a legislative intention that the failure to give written notice leads to a decision that is made without any statutory basis. Even if there was such a procedural defect, she asserts that the operation of s 474 removes any implied intention that a procedural step may be a condition of validity, with the result that no jurisdictional error arises if there is a failure to comply with s 424A. The Minister submits that, if jurisdictional error is found, discretionary relief can and should be withheld for the reasons that the first appellant was not in fact deprived of the opportunity to learn of and comment on material adverse to the appellants' claim. The Minister also claims that relief should be withheld because the breach of s 424A did not affect the outcome of the appellants' claim. The procedural issue: joinder of the Tribunal In addition to the substantive issues to which I have referred, the appeal also gives rise to a preliminary issue concerning parties. That issue is whether the proceedings before the Federal Court and this Court were correctly constituted and sufficient, given that the Tribunal was omitted as a party for the relief sought under s 39B of the Judiciary Act. Where a person claims that he or she is affected by a decision of an officer of the Commonwealth that was made without jurisdiction, the Constitution empowers this Court to issue a constitutional writ under s 75(v) of the McHugh Constitution. That writ must be directed to the officer of the Commonwealth who made the decision. Section 39B of the Judiciary Act also vests in the Federal Court the jurisdiction of this Court with respect to any matter in which a constitutional writ is sought against an officer of the Commonwealth. The appellants seek the quashing of the decision of the Tribunal (certiorari) and an order compelling the Tribunal to conduct, according to law, a review of the decision of the Minister's delegate. The Tribunal is the relevant "officer of the Commonwealth" for the purposes of this appeal. Accordingly, it is necessary that the Tribunal be joined as a party to this appeal. Was there a failure to comply with s 424A? The s 424A issue Determining whether the Tribunal breached s 424A in this case and, if so, whether such a breach amounted to jurisdictional error turns on the construction of that section in the context of Div 4 of Pt 7 of the Act15. The exercise of construction involves the ascertainment of the legislative intention with respect to s 424A, both as to its application and the effect of failing to comply with it. Breach of the provision will lead to invalidity only if that is the legislative intention16. First, however, it is necessary to consider the operation of s 424A in the context of Div 4 of Pt 7 of the Act and to determine whether there was a failure to comply with that section in the circumstances of the case. Construction of the Division Division 4 of Pt 7 of the Act (ss 423-429A) is entitled "Conduct of review". It deals with the conduct of the review by the Tribunal of a decision of a delegate of the Minister that precedes the recording of the Tribunal's decision. The Division deals with: the giving of documents to the Tribunal (s 423); the powers of the Tribunal to seek additional information (s 424); the Tribunal's obligation to give the applicant for review certain information and to invite the applicant to comment on it (s 424A); 15 Part 7 of the Act is applicable in the form it took after the commencement of the Migration Legislation Amendment (Electronic Transactions and Methods of Notification) Act 2001 (Cth). 16 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 388-389 [91] per McHugh, Gummow, Kirby and Hayne JJ. McHugh the means by which an applicant may respond to an invitation to give additional information or comment upon information (s 424B); the consequences of a failure by the applicant to give additional information or comment upon information if invited to do so (s 424C); the Tribunal's obligation to invite the applicant to appear before the Tribunal "to give evidence and present arguments relating to the issues arising in relation to the decision under review" (s 425); the means by which the Tribunal must notify the applicant if the Tribunal invites the applicant to appear before it (s 425A); the applicant's entitlement to request the Tribunal to call witnesses (s 426); the consequences of a failure by the applicant to appear before the Tribunal if invited to do so (s 426A); the powers of the Tribunal for the purpose of the review, including its powers in relation to the conduct of a hearing (s 427); the powers of the Tribunal to authorise another person to take evidence on behalf of the Tribunal (s 428); the obligation to conduct the hearing in private (s 429); and the methods by which an applicant may give oral evidence before the Tribunal at a hearing (s 429A). In essence, then, the Division deals with the steps leading up to an appearance before the Tribunal (where the applicant may appear before the Tribunal to give evidence and present arguments) and the appearance itself. The Division distinguishes between an appearance before the Tribunal to give evidence and present arguments and an interview. The Division also distinguishes between providing additional information or making comments at an interview under s 424B and giving evidence at an appearance before the Tribunal under s 425. Section 424A obliges the Tribunal in certain circumstances to give the applicant "particulars of any information that the Tribunal considers would be the reason, or a part of the reason, for affirming the decision that is under review". The section provides: "424A Applicant must be given certain information Subject to subsection (3), the Tribunal must: McHugh give to the applicant, in the way that the Tribunal considers appropriate the circumstances, particulars of any information that the Tribunal considers would be the reason, or a part of the reason, for affirming the decision that is under review; and ensure, as far as is reasonably practicable, that the applicant understands why it is relevant to the review; and invite the applicant to comment on it. The information and invitation must be given to the applicant: except where paragraph (b) applies – by one of the methods specified in section 441A; or if the applicant is in immigration detention – by a method prescribed for the purposes of giving documents to such a person[17]. This section does not apply to information: that is not specifically about the applicant or another person and is just about a class of persons of which the applicant or other person is a member; or that the applicant gave for the purpose of the application; or that is non-disclosable information." Regulation 5.02 of the Migration Regulations (Cth) states: "For the purposes of the Act and these Regulations, a document to be served on a person in immigration detention may be served by giving it to the person himself or herself, or to another person authorised by him or her to receive documents on his or her behalf." Regulation 5.01 states: "In this Division: 'document' includes: a letter; and 17 See reg 5.02 of the Migration Regulations (Cth). McHugh an invitation, notice, notification, statement or summons, if it is in writing." The obligation on the Tribunal to give the invitation and to invite comment on the information is expressed in broad and general terms. The obligation does not apply to information that the applicant gives, regardless of when that information is given (see s 424A(3)(b)). It applies to information received by the Tribunal from sources other than the applicant. It also does not apply to all information that the Tribunal receives. It only applies to information that the Tribunal considers "would form part of its reason for refusing the application for review"18. Nevertheless, the object of the section must be to provide procedural fairness to the applicant by alerting the applicant to material that the Tribunal considers to be adverse to the applicant's case and affording the applicant the opportunity to comment upon it. Unfortunately, the section does not state how the obligation to give the applicant information and to invite comment on it applies to information that the Tribunal receives in a case like the present. It does not state how the obligation is performed, or whether it is required to be performed, when the applicant (or the applicant's representative) is present while the Tribunal receives evidence from a person. It is appropriate to consider the second question first. Does s 424A apply when the s 425 procedure is engaged? Section 425 provides that the Tribunal need not invite the applicant to appear to give evidence and present arguments in certain circumstances. It need not do so if the Tribunal has earlier invited the applicant to comment on adverse information and the applicant fails to do so within the stipulated time (see s 425(2)(c), read with s 424C(2) and s 424A). Section 425 contemplates that the Tribunal will have given the applicant adverse material and invited comments upon it before the applicant is invited under s 425 to appear before the Tribunal or the Tribunal exercises its discretion not to invite the applicant to appear. However, it is by no means certain that s 424A is exhausted at the time when the Tribunal has invited the applicant to appear before it to give evidence and present arguments. Under s 425(2), the Tribunal is not required to invite the applicant to appear before it if the applicant has been invited to give additional information under s 424 but fails to do so within the stipulated time so that s 424C(1) or (2) applies. But the Tribunal is not required to invite the applicant 18 See Minister for Immigration and Multicultural Affairs v Al Shamry (2001) 110 FCR 27 at 40 [39] per Merkel J, Ryan and Conti JJ agreeing. McHugh to appear before it even if a third person has been invited to give additional information under s 424 and fails to do so within the stipulated time19. If the Minister's construction of the Division were accepted, there would be no need to distinguish between obtaining additional information from the applicant and obtaining additional information from a third person. The Tribunal would be obliged to request, obtain and invite comment on any and all additional information before invoking s 425 (and either inviting the applicant to appear or exercising its discretion to invite the applicant to appear if s 425(2) applies). If the Tribunal were not required to give the applicant adverse material that emerged when a third person gave evidence to the Tribunal (at a time when the applicant had appeared or had been invited to appear under s 425), then it would not matter whether s 424C(1) applied to the applicant or not. The Tribunal would not be able to obtain additional information from the applicant or from a third person. As the time to obtain additional information would have passed, the Tribunal would not be entitled to pursue any matter that arose once an invitation to appear had been given or the applicant had appeared before the Tribunal. This would be so even if, for example, a third person gave evidence about a matter which was relevant to the decision under review and about which the Tribunal would otherwise have sought additional information. If the Minister's construction of the Division were accepted, therefore, the Tribunal's powers to review decisions of the Minister's delegate would be substantially circumscribed. For example, if, either shortly before or at a hearing under s 425, the Tribunal learned of or realised the potential implications of certain information caught by s 424A, the Tribunal would be required "to cancel or adjourn the hearing without then exploring the significance of the information."20 The main purpose of the Division is to accord procedural fairness to applicants in determining whether a decision of the Minister or the Minister's delegate should be affirmed. The Tribunal is the vehicle through which this purpose is effected. The Tribunal is empowered to use an inquisitorial process to conduct the review of the decision. The Division does not provide for an adversarial contest that culminates in a trial of issues joined between the parties. It is inconsistent with the inquisitorial nature of the review to require the Tribunal to obtain all information relevant to the decision under review before invoking the s 425 procedure. This is particularly the case if subsequent information emerges that affects the decision under review. Such information may emerge at any time. Given that the Tribunal exercises all the powers of the Minister or the 19 See s 425(2)(c), read with s 424C(1) and (2). 20 SRFB v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCAFC 252 at [36]. McHugh Minister's delegate when conducting the review21, there is no reason to confine the exercise of the Tribunal's power to "get any information that it considers relevant"22 to a particular point in time. In addition, s 424A "is enlivened only at the point at which the RRT has information and has determined that the information would be the reason or part of the reason for affirming the decision" under review23. The Tribunal may not realise that information it has obtained from a third person will form the reason or part of the reason for affirming the decision until after the applicant has appeared before it. Information obtained before the hearing may become the reason or part of the reason for affirming the decision only after an applicant has responded to questions at the hearing. It would seem to be contrary to the requirements of procedural fairness if the Tribunal were not required to invite the applicant to comment on such information (that is found to be adverse to the applicant) simply because the Tribunal has already invited the applicant to appear before it. No doubt there is a tension between different elements of the review process. There is the obligation to accord procedural fairness to the applicant by advising the applicant of adverse material and inviting the applicant's response. But the object of the Division is also to facilitate the quick and efficient determination of applications for review24. The second object can be achieved, however, by the Tribunal using its broad powers to obtain documentary evidence before invoking s 425 and, in some cases, enabling the Tribunal to decide the application in favour of the applicant without needing to conduct a hearing under In determining an application for review, the Tribunal may also exercise all the powers and discretions conferred by the Act on the Minister or her delegate25. Those powers are set out in a subdivision entitled "Code of procedure for dealing fairly, efficiently and quickly with visa applications"26. The 21 Section 415 of the Act. 22 Section 424(1) of the Act. 23 SRFB [2004] FCAFC 252 at [48], referring to VEAJ of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs (2003) 132 FCR 291 at 301 [31] per Gray J; Nader v Minister for Immigration and Multicultural Affairs (2000) 101 FCR 352 at 366 [59] per Hill J. 24 See s 420(1) of the Act. 25 Section 415(1) of the Act. 26 Part 2 Div 3 subdiv AB of the Act (emphasis added). McHugh legislative object of dealing with visa applications and applications for review efficiently and quickly should not be interpreted to detract from the obligation to deal with them fairly. Indeed, the powers of the Tribunal to determine applications for review on the available documentation – without having to obtain information or comment from the applicant or inviting the applicant to appear before the Tribunal – is limited to circumstances where that information is favourable to the applicant. If the Tribunal obtains any adverse material, it must put that material to the applicant and invite comment on it27. If the Tribunal summons a person to give evidence and that evidence discloses adverse material, it would be anomalous if the Tribunal were not required to put that material to the applicant. The Tribunal may only dismiss an application for review without inviting the applicant to appear before it if the Tribunal has invited the applicant to give additional information or to comment on adverse material and the applicant has not done so within the time stipulated28. Sections 424, 424A, 424B and 424C enable the Tribunal to obtain information, to ensure that the applicant has the opportunity to respond to adverse material (or to provide additional information) and to facilitate the making of a decision without the need to conduct a hearing. The purpose of those sections is also to improve the efficiency of the Tribunal's procedures. The sections effectively compel the Tribunal to obtain the maximum amount of information that may be available before engaging s 425. The information is not limited to documentary information. A person might give additional information in an interview. The point is that the Tribunal has the power to determine the application without having to invoke the s 425 procedure. But this does not mean that s 424A is spent because s 425 is engaged. In other words, the Division does not necessarily compel a sequential process, so that once the s 425 procedure has commenced or is in progress, s 424A no longer has any role to play. The obligation to deal fairly with applications for review must continue throughout the Tribunal's review. One aspect of that obligation is that the applicant be given the opportunity to comment upon adverse material. Because that is so, the Division should be interpreted so as to require the Tribunal to give the applicant the opportunity to comment on adverse material obtained at a hearing before the Tribunal (when the applicant or another person gives evidence). No doubt, this reasoning is open to the criticism that it is circular. It assumes that one aspect of the Tribunal's obligation in conducting the review is to give the applicant the opportunity to comment upon adverse material. Such a result only obtains if the Division is construed to that effect – which begs the question. But given the rule that the principles of procedural 27 Section 424A of the Act. 28 Section 425(2)(c), read with s 424C of the Act. McHugh fairness apply unless excluded by express words or necessary implication, the assumption seems sound. Another argument that favours a construction of the Division for which the appellants contend is that there is nothing in the Division to suggest that the Division is to have a strict sequential operation. If it were, the exercise by the Tribunal of its powers of review would be substantially confined. In the context of the otherwise broad powers of the Tribunal in the conduct of the review, such a result could hardly have been intended by the Parliament. But is there a legislative intention that s 424A is spent when the Tribunal has invoked the s 425 procedure and obtained adverse material during a s 425 "hearing" in which the applicant is present to give evidence and present arguments? The extrinsic materials are inconclusive on this issue, but they do not compel a construction of the Division in which s 424A is spent at the time when s 425 is engaged. The Explanatory Memorandum to the Migration Legislation Amendment Bill (No 1) 1998 (Cth), which inserted the relevant sections into the Act, is neutral. So is the Second Reading speech for that Bill. Arguably, it is unnecessary to require the Tribunal to provide adverse material to the applicant in writing when the applicant is present to hear the information given by another person that the Tribunal receives as evidence. However, an applicant may not understand the significance of that information. So it is in the interests of fairness that the applicant should have the information in writing and should be given an opportunity to comment on it. For that reason, s 424A should not be regarded as spent because the applicant is present at the hearing. If s 424A applies when the s 425 procedure is engaged, what is the content of the obligation? What obligation does s 424A(1) impose? Is the obligation to give the information in writing mandatory in the sense that failure to do so results in a breach of the section? Is the obligation (to provide adverse information) limited or qualified in some way simply because of the way in which the information is to be provided to the applicant? Section 424A "makes no provision for an invitation to be given to an applicant in the course of the hearing."29 On the one hand, there is no express limitation that the Tribunal may not depart from the statutory requirements of s 424A by, for example, inviting the applicant to respond orally during a s 425 hearing. However, s 424A(2) is expressed in imperative terms. If the applicant 29 SRFB [2004] FCAFC 252 at [50], citing Al Shamry (2001) 110 FCR 27 at 37 [30]. McHugh is in immigration detention, the Tribunal "must" give the information to the applicant "by a method prescribed for the purposes of giving documents to such a person." The section contemplates that the information is in the form of a document and that there is a method prescribed for giving documents to the applicant. The section gives the Tribunal a discretion as to which method to use for giving documents to an applicant in immigration detention, but requires the Tribunal to use one of those methods. As the Full Federal Court (Ryan, Jacobson and Lander JJ) observed in SRFB v Minister for Immigration and Multicultural and Indigenous Affairs30, s 424A "is a statutory enactment of the basic rules of natural justice." Gray J in VEAJ of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs31 also made observations to similar effect, that is, that the section is "a statutory expression of the content of the rules of procedural fairness". In NAHV of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs32, the Full Federal Court said that, where the applicant was not in immigration detention, "s 424A (and in particular s 424A(2)) contemplates the person being told of the matters in s 424A(1) in writing."33 This reasoning also applies to an applicant who is in immigration detention. Section 424A(2)(b) refers to a method for "giving documents" to the person and, hence, contemplates that the information will be in writing. These statements suggest that a breach of s 424A occurs by any failure to provide to the applicant in writing the adverse material and the invitation to comment on it. In SRFB, the Full Court held that "the only implied limitation [on s 424A] can be one of fairness in the way in which the statutory obligations are observed."34 The Court held that each case turns on its own facts. "[I]t is impossible to spell out the content of this limitation in more precise terms."35 30 [2004] FCAFC 252 at [52], citing Al Shamry (2001) 110 FCR 27 at 40 [39]-[40]. 31 (2003) 132 FCR 291 at 305 [46]. 32 (2003) 129 FCR 214 at 218 [18] (emphasis in original). 33 This was because s 424A(2) obliges the Tribunal (at 218 [18]) "to provide the particulars and information called for by s 424A(1) and the invitation to respond to those matters by one of the methods referred to in s 441A. All the methods referred to in s 441A involve the sending or giving of a document." (emphasis in original) 34 [2004] FCAFC 252 at [52], citing Al Shamry (2001) 110 FCR 27 at 40 [39]-[40]. 35 SRFB [2004] FCAFC 252 at [53]. McHugh However, the Court observed that "[a]n example of procedural unfairness would be if an interviewing officer were to inform an applicant at the hearing that, although the requisite statutory notice would be given after the hearing, the applicant would be treated more favourably if he or she responded orally without waiting for the notice."36 In SRFB, the Full Court found that the Tribunal formed the view at a s 425 hearing that certain information in an application for a tourist visa was a reason or part of a reason for affirming the decision37. The "interviewing officer gave the [applicants] a choice as to whether to respond immediately or to await receipt of the statutory notice before providing a response."38 The Tribunal gave the applicants a s 424A notice after the hearing. The Court held that in these circumstances the applicants had not been denied procedural fairness. However, the assumption that no breach of s 424A occurs if the applicant has otherwise been given procedural fairness overlooks the imperative nature of the section. Nothing in the section suggests that fairness in the way in which the Tribunal observes its statutory obligations is an implied limitation on its operation. The section describes a procedural step that, if enlivened by the circumstances of the case, the Tribunal is required to take in every case. Further, the mandatory nature of the obligation in s 424A(2)(b) points to the conclusion that the failure to provide in writing to the applicant particulars of the adverse material and the invitation to comment upon it amounts to a breach of s 424A. Before the primary judge, the Minister accepted that there was no written notification given under s 424A39. Mansfield J found that s 424A applied and that the Tribunal failed to comply with the obligation to give the first appellant in writing particulars of the adverse information obtained from her daughter's evidence40. The Minister did not seek to challenge the finding before the Full Federal Court41 or before this Court42 that a technical breach of s 424A had occurred. However, the Minister contended that the word "must" in s 424A(1) did not impose a mandatory obligation on the Tribunal "in all circumstances" to 36 SRFB [2004] FCAFC 252 at [53]. 37 SRFB [2004] FCAFC 252 at [54]. 38 SRFB [2004] FCAFC 252 at [55]. 39 SAAP [2002] FCA 577 at [33] per Mansfield J. 40 SAAP [2002] FCA 577 at [45]. 41 SAAP of 2001 [2002] FCAFC 411 at [14]. 42 Transcript [2004] HCATrans 284 at [2075]-[2080]. McHugh provide the adverse information in writing43. The Minister also contended that, even if there was a failure to comply with s 424A, such failure did not amount to jurisdictional error with the result that the Tribunal's decision was invalid44. Because the language of s 424A is imperative, failure to comply with the obligation to provide the applicant with particulars of adverse information in writing constitutes a breach of that section. Gray J remarked in VEAJ that45: "It is clear from sub-s (2) [of s 424A] that the Tribunal cannot discharge its obligation by giving to an applicant oral particulars of the information in the course of a hearing. The obligation of the Tribunal to give both the particulars and an indication of the relevance of the information by one of the means specified in s 441A, or by the prescribed means of giving documents to persons in detention, makes it clear that the particulars and the explanation of relevance must be reduced to writing. Even in the case of relatively simple, and perhaps uncontroversial, items of information, the Tribunal is not given the option of raising them with an applicant in the course of a hearing and giving an oral explanation of its view as to their relevance. The Tribunal must give written particulars and a written explanation." to provide His Honour's approach should be followed. There was some debate before this Court as to whether the term "must" in s 424(1) necessarily imposed a "mandatory" requirement in all circumstances. However, in the absence of any qualifying terms, the natural meaning of the section is that the Tribunal is compelled in all circumstances to provide the information in writing. This is so, even if the Tribunal puts the information to the applicant at an interview or when the applicant appears before the Tribunal to give evidence and present arguments. Such a construction is consistent with the purpose of the section to accord the applicant procedural fairness in the conduct of the review. information in writing the The effect of the failure to comply with s 424A: the jurisdictional error issue Jurisdictional error may arise where a decision-maker fails to discharge "imperative duties" or to observe "inviolable limitations or restraints" found in the Act46. To determine whether a decision under the Act involves a 43 Transcript [2004] HCATrans 284 at [2381]-[2385]. 44 Transcript [2004] HCATrans 284 at [2400]-[2410]. 45 (2003) 132 FCR 291 at 301-302 [34]. 46 Minister for Immigration and Multicultural and Indigenous Affairs v SGLB (2004) 78 ALJR 992 at 1001 [49]; 207 ALR 12 at 23-24. McHugh jurisdictional error, it is necessary to take two steps. First, it is necessary to determine the limitations and restraints found in the Act. Secondly, it is necessary to attempt, through statutory construction, to reconcile them with s 474 of the Act to ascertain whether failure to observe any particular procedural or other requirement in the Act constitutes an error which has resulted in the decision-maker failing to exercise or exceeding its jurisdiction. Section 424A is a statutory formulation of the obligation to accord procedural fairness in the conduct of a review. The question is whether failure to comply with that section gives rise to jurisdictional error such that the decision of the Tribunal is invalidated. To answer this question, it is necessary to have regard to "the language of the relevant provision and the scope and object of the whole statute" in order to ascertain whether the Parliament intended that an act done in breach of s 424A is invalid47. The question is not easy to answer. In the joint judgment in Project Blue Sky Inc v Australian Broadcasting Authority, Gummow, Kirby and Hayne JJ and I said that whether an act done in breach of a condition regulating the exercise of a statutory power is invalid48: "depends upon whether there can be discerned a legislative purpose to invalidate any act that fails to comply with the condition. The existence of the purpose is ascertained by reference to the language of the statute, its subject matter and objects, and the consequences for the parties of holding void every act done in breach of the condition. Unfortunately, a finding of purpose or no purpose in this context often reflects a contestable judgment. The cases show various factors that have proved decisive in various contexts, but they do no more than provide guidance in analogous circumstances. There is no decisive rule that can be applied; there is not even a ranking of relevant factors or categories to give guidance on the issue. … A better test for determining the issue of validity is to ask whether it was a purpose of the legislation that an act done in breach of the provision should be invalid. … In determining the question of purpose, regard must be had to 'the language of the relevant provision and the scope and object of the whole statute'." (footnotes omitted) Failure to accord procedural fairness may give rise to jurisdictional error. In NAHV, the Full Federal Court held that failure to observe the requirement in s 424A(2) did not amount to jurisdictional error by the Tribunal (ie, a failure to 47 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 390-391 [93] per McHugh, Gummow, Kirby and Hayne JJ, quoting Tasker v Fullwood [1978] 1 NSWLR 20 at 24. 48 (1998) 194 CLR 355 at 389-391 [91], [93]. McHugh exercise jurisdiction or an exceeding of jurisdiction), in circumstances where there was no unfairness or failure to accord procedural fairness. That was because the failure to comply with s 424A(2) was not one of substance. It went only to the procedural question of communicating the information referred to in s 424A(1)49. The Full Court held that Parliament did not intend that a breach of the condition as to the manner of delivery of the information should necessarily result in the invalidity of the Tribunal's decision even in circumstances where the important substantive requirement of s 424A(1) was otherwise satisfied50. Accordingly, the Court held that the failure to convey the information by the correct method did not constitute jurisdictional error51. The Full Court said52: "The 'mandatory' language (the word 'must' is used in s 424A(2)) is relevant to, but not decisive of, this inquiry. In our view, it cannot be concluded that invalidity of the Tribunal's decision is the necessary consequence of any failure to comply with s 424A(2), irrespective of the absence of any unfairness, whether of a substantive or procedural kind." However, this statement was made in the context where it was common ground that the Tribunal had complied with s 424A(1). The Court acknowledged that "[q]uite different considerations might attend the analysis had there been a breach of s 424A(1)."53 On this view s 424A operates: when the s 425 procedure has been invoked; when the Tribunal obtains adverse material during a s 425 hearing; and when the Tribunal fails to give to the applicant in writing that information, the explanation of its relevance and the invitation to comment on it. The failure is a breach of s 424A and may amount to jurisdictional error. In NAHV, the Court accepted that no unfairness or failure to accord procedural fairness had occurred in circumstances where the Tribunal advised the 49 (2003) 129 FCR 214 at 219 [22], referring to Emmett J's judgment in Paul v Minister for Immigration and Multicultural Affairs (2001) 113 FCR 396. 50 NAHV of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs (2003) 129 FCR 214 at 219-220 [23]. 51 NAHV (2003) 129 FCR 214 at 219-220 [23]. 52 NAHV (2003) 129 FCR 214 at 219-220 [23]. 53 NAHV (2003) 129 FCR 214 at 220 [23]. McHugh applicant that it had certain information (an anonymous letter) that was potentially adverse to the applicant. The Tribunal conducted an interview with the applicant to discuss the letter. Apparently, it gave the applicant particulars of the adverse material and implicitly invited the applicant to comment on it. But it did not give the applicant those particulars or the invitation to respond in writing. The applicant did not complain about this aspect of the Tribunal's hearing (that is, the applicant did not assert that there was any failure to give him that information or invite his comment), so the Full Court proceeded on the basis that no such failure had occurred. However, because the Act compels the Tribunal in the conduct of the review to take certain steps in order to accord procedural fairness to the applicant for review, before recording a decision, it would be an anomalous result if the Tribunal's decision were found to be valid, notwithstanding that the Tribunal has failed to discharge that obligation. It is not to the point that the Tribunal may have given the applicant particulars of the adverse information orally. It is also not to the point that in some cases it might seem unnecessary to give the applicant written particulars of adverse information (for example, if the applicant is present when the Tribunal receives the adverse information as evidence from another person and the Tribunal there and then invites the applicant orally to comment on it). If the requirement to give written particulars is mandatory, then failure to comply means that the Tribunal has not discharged its statutory function. There can be no "partial compliance" with a statutory obligation to accord procedural fairness. Either there has been compliance or there has not. Given the significance of the obligation in the context of the review process (the obligation is mandated in every case), it is difficult to accept the proposition that a decision made despite the lack of strict compliance is a valid decision under the Act. Any suggestion by the Full Federal Court in NAHV to the contrary should not be accepted. Parliament has made the provisions of s 424A one of the centrepieces of its regime of statutory procedural fairness. Because that is so, the best view of the section is that failure to comply with it goes to the heart of the decision-making process. Consequently, a decision made after a breach of s 424A is invalid. Breach of general law requirements of procedural fairness If it is accepted that a breach of s 424A gives rise to jurisdictional error, it is not necessary to consider whether that breach also resulted in a failure to accord procedural fairness under the general law. McHugh Discretionary relief Since this Court the decisions of in Plaintiff S157/2002 v The Commonwealth54, SGLB55 and Re Minister Immigration and Multicultural and Indigenous Affairs; Ex parte Applicants S134/200256, a decision that involves the failure to comply with the principles of natural justice is not a privative clause decision57. As a result, s 474 of the Act (the privative clause section) does not prevent the judicial review of such decisions that involve jurisdictional error. (Decisions of such a character are not "privative clause decisions" and immune from judicial review because they are not decisions made "under" the Act.) A decision made in breach of the requirement to accord procedural fairness may be the subject of constitutional writs58. for The issuing of writs under s 75(v) of the Constitution and s 39B of the Judiciary Act is discretionary59. Discretionary relief may be refused under s 39B if the conduct of the party is inconsistent with the application for relief. It may be inconsistent, for example, if there is delay on the part of the applicant or the applicant has waived or acquiesced in the invalidity of the decision or does not come with clean hands60. Discretionary relief may also be refused if the applicant has in fact suffered no injustice, for example, because the statutory law compels a particular outcome61. 54 (2003) 211 CLR 476. 55 (2004) 78 ALJR 992; 207 ALR 12. 56 (2003) 211 CLR 441. 57 Plaintiff S157 (2003) 211 CLR 476 at 508 [83]. 58 Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82; Miah (2001) 206 CLR 57. 59 Aala (2000) 204 CLR 82 at 108-109 [57]-[58] per Gaudron and Gummow JJ, 60 See Aala (2000) 204 CLR 82 at 108 [57] per Gaudron and Gummow JJ, citing F Hoffmann-La Roche & Co AG v Secretary of State for Trade and Industry [1975] AC 295 at 320 per Lord Denning MR. 61 See Aala (2000) 204 CLR 82 at 109 [58] per Gaudron and Gummow JJ, citing Mobil Oil Canada Ltd v Canada-Newfoundland Offshore Petroleum Board [1994] 1 SCR 202 at 228. McHugh The Minister contends that, where relief is sought for breach of the obligation to accord procedural fairness, relief should only be withheld where the Court is positively satisfied that compliance with the obligation "could not have made any difference"62. The Minister notes the conclusion of Mansfield J that63: "The [Tribunal's] failure to comply with s 424A, the circumstances, has not in fact deprived the [first appellant] of the opportunity to learn of material adverse to her claim or to comment upon it. In practical terms, she has had the opportunity which s 424A is intended to provide. The breach of s 424A is, in my view, not one which affected or which might have affected the outcome of her claim." The Minister submits that the first appellant in fact had the opportunity to learn of the information given by her eldest daughter that was adverse to her claim and had the opportunity to comment upon it. She was aware – through her migration agent – of what her eldest daughter said and had sufficient opportunity to respond. The Minister contends that, because the first appellant was not deprived of a relevant opportunity to respond to the adverse material, no unfairness occurred. In VCAT of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs64, the Full Federal Court held that in some circumstances it was appropriate to refuse relief under s 39B if the applicant was not in fact disadvantaged or had an opportunity to address the information in s 424A. In relation to s 359A (the equivalent of s 424A in relation to the Migration Review Tribunal), the Full Federal Court in Minister for Immigration and Multicultural and Indigenous Affairs v Awan65 also accepted that a breach of that section constitutes jurisdictional error. But it said that whether a breach of that section was merely technical and did not affect the outcome or could make no difference was relevant to whether relief should be granted. However, where the relevant breach is the failure to observe fair decision- making procedures, the bearing of the breach upon the ultimate decision should not itself determine whether the constitutional writs of certiorari and mandamus should be granted. If there has been a breach of the obligation to accord procedural fairness, there is jurisdictional error for the purposes of s 75(v) of the Constitution. There is no reason to rewrite the limitation ordinarily implied on 62 Stead v State Government Insurance Commission (1986) 161 CLR 141 at 145. 63 SAAP [2002] FCA 577 at [46]. 64 [2003] FCAFC 141 at [45], [52]. 65 (2003) 131 FCR 1 at 7 [15], 10 [24]-[27] per Gray ACJ, 15 [58]-[59] per Marshall J, 27 [106]-[107] per Merkel J. McHugh the statutory power to deny jurisdictional error for "trivial" breaches of the requirements of procedural fairness66. If the decision of the Tribunal is invalid for want of procedural fairness, there is no reason to withhold discretionary relief. There is nothing to suggest that the conduct of the appellants warrants the refusal to exercise the discretion. There is no suggestion of delay, waiver, acquiescence or unclean hands. Whether the first appellant was in fact deprived of a relevant opportunity to deal with the adverse material received by the Tribunal from her eldest daughter should not affect the discretion to grant relief. Orders I agree with the orders proposed by Hayne J. 66 Aala (2000) 204 CLR 82 at 109 [59] per Gaudron and Gummow JJ. GUMMOW J. The appellants are mother and daughter and are Iranian citizens. They applied to the Federal Court of Australia under s 39B of the Judiciary Act 1903 (Cth) ("the Judiciary Act") to set aside a decision of the Refugee Review Tribunal ("the RRT") given on 18 October 2001. The RRT affirmed decisions of a delegate of the first respondent ("the Minister") refusing to grant to the appellants protection visas under the Migration Act 1958 (Cth) ("the Act"). The visas had been sought shortly after the arrival of the appellants in Australia on 24 March 2001 by boat from Indonesia. The facts The first appellant was born in Iran in 1956. She is not literate in any language and has little familiarity with spoken English. The second appellant is one of five children. She was born in Iran in 1993 and a protection visa was sought for her as a member of the family of the first appellant. Accordingly, in the RRT, the Federal Court and this Court, it has been sufficient to address the contentions of the first appellant. An elder daughter, Ms Susan Naghdi, had preceded her mother and sister to Australia and was granted a protection visa. She had married, when aged 18, while she was living in Iran. The first appellant's husband and other three children remained in Iran. The first appellant is an adherent of the ancient Sabian-Mandean religion, of which up to 25,000 adherents live in Iran. She complained of persecution by reason of her religious belief, suffered at the hands of the Muslim majority in Iran. However, the RRT rejected key elements of her claims and was not satisfied that the difficulties she had experienced in Iran were sufficiently serious to amount to persecution in the necessary sense. The Federal Court proceedings Although it was dealt with as an application under s 39B of the Judiciary Act, the application made to the Federal Court did not join the RRT as a party. Leave to do so was sought and granted in this Court. The Amended Notice of Appeal joins the RRT as second respondent and seeks orders for certiorari and mandamus. It was suggested in argument that the joinder of the RRT would be unnecessary and, indeed, that the RRT was neither a necessary nor a proper party in a s 39B application. The reason given was that a combination of s 477 and s 479 of the Act relieved the RRT from the tedium of entering submitting appearances, not only to judicial review applications under the Act (grounded in s 76(ii) and s 77(i) of the Constitution as matters arising under the Act), but also to applications under s 39B of the Judiciary Act for constitutional writs67. Subject to the qualifications expressed therein, s 39B "vests in the Federal Court the entirety of the jurisdiction which s 75(v) confers on the High Court"68. That particular head of federal jurisdiction is attracted by the seeking of a particular remedy against a federal officeholder69. Remedy and identity of party are thus critical. Sections 477 and 479 of the Act, read together, accept that s 39B still operates with respect to constitutional writ applications; to deny the necessity for the presence of the RRT on the record would be to withdraw that element which gives the proceeding for constitutional writs the character of a Ch III "matter". As Toohey J put it in Deputy Commissioner of Taxation v Richard Walter Pty Ltd70: "Section 39B is enacted pursuant to s 77(i) of the Constitution, which empowers the Parliament to make laws with respect to any of the matters mentioned in s 75, 'Defining the jurisdiction of any federal court other than the High Court'." In the present litigation, a judge of the Federal Court (Mansfield J) held that no basis had been established for relief under s 39B and dismissed the application. An appeal to the Full Court (Heerey, Moore and Kiefel JJ) was dismissed on 11 December 2002. That was shortly before delivery of the decision of this Court in Plaintiff S157/2002 v The Commonwealth71. This Court gave to the privative clause provision in s 474 of the Act an interpretation which differed from that previously adopted in the Federal Court. 67 cf NAAA v Minister for Immigration and Multicultural Affairs (2002) 117 FCR 287 at 289-294; NAAG v Minister for Immigration and Multicultural Affairs [2003] FCAFC 135 at [60]. 68 Deputy Commissioner of Taxation v Richard Walter Pty Ltd (1995) 183 CLR 168 at 181 per Mason CJ. Section 39B has since been amended and augmented (Australian Securities and Investments Commission v Edensor Nominees Pty Ltd (2001) 204 CLR 559 at 581-583 [40]-[45], 638 [215]), but this does not diminish the accuracy of the statement by Mason CJ. 69 Australian Securities and Investments Commission v Edensor Nominees Pty Ltd (2001) 204 CLR 559. 70 (1995) 183 CLR 168 at 231. 71 (2003) 211 CLR 476. In this Court In this Court, it is now accepted that the essential issue for determination is whether the decision of the RRT manifests jurisdictional error. If so, then relief under s 39B of the Judiciary Act remains available notwithstanding s 474 of the Act. In Minister for Immigration and Multicultural and Indigenous Affairs v SGLB72, further consideration was given to Plaintiff S157 and to the companion decision, Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Applicants S134/200273. In the joint judgment of Gummow and Hayne JJ in SGLB, with which the Chief Justice agreed74, it was said75: "Consistently with the reasoning in Plaintiff S157, there may be a question as to whether there has been a jurisdictional error by reason of the failure to discharge what have been called 'imperative duties' or to observe 'inviolable limitations or restraints' found in the Act. In Plaintiff S157, this question was readily answered, given the nature of the alleged error by the Tribunal. The joint judgment explained the situation as follows:76 'The plaintiff asserts jurisdictional error by reason of a denial to him of procedural fairness and thus s 474, whilst valid, does not upon its true construction protect the decision of which the plaintiff complains. A decision flawed for reasons of a failure to comply with the principles of natural justice is not a "privative clause decision" within s 474(2) of the Act.' In other cases, the nature of the alleged error will turn upon the meaning of the construction of the legislation the primary and essential task. Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte legislative criterion of jurisdiction, making the 72 (2004) 78 ALJR 992; 207 ALR 12. 73 (2003) 211 CLR 441. 74 (2004) 78 ALJR 992 at 993 [1]-[3]; 207 ALR 12 at 13-14. 75 (2004) 78 ALJR 992 at 1001 [49]-[50]; 207 ALR 12 at 23-24. 76 (2003) 211 CLR 476 at 508 [83]. As to natural justice and jurisdictional error, see Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82; Re Minister for Immigration and Multicultural Affairs; Ex parte Miah (2001) 206 CLR 57. Applicants S134/200277 was such a case. The Court divided on the question whether, on the proper construction of the relevant regulations under the Act, as picked up by s 65(1), the Tribunal had been obliged to determine to its satisfaction whether applicants were entitled to protection visas by reason of membership of the family unit of a person who had already been granted a protection visa. The majority answered 'no'; Gaudron and Kirby JJ were of the other view.78" On the present appeal, the appellants submit that provisions in Pt 7, Div 4 (ss 423-429A) of the Act79, in particular s 424A, impose an inviolable limitation or restraint upon the exercise of jurisdiction by the RRT. They contend that in the circumstances of this case s 424A had been engaged but the RRT had not observed its requirements respecting written notice. It is contended that failure to comply with s 424A necessarily entails jurisdictional error and so attracts s 39B of the Judiciary Act. Alternatively, it is submitted that, if s 424A does not, on its proper construction, have this consequence, the same result of jurisdictional error follows from failure in observance of procedural fairness. That was the position in Plaintiff S157 itself. There is then a debate between the parties as to whether, even if jurisdictional error were shown, as a matter of discretion relief under s 39B can and, if so, should be withheld. There was no failure to comply with s 424A as on its proper construction it did not have the operation the appellants urge. Nor was there a failure to observe the requirements of procedural fairness. Therefore, there was no jurisdictional error, and no occasion to consider denial of relief on discretionary grounds. The review by the RRT It is convenient to commence by saying something more respecting the conduct of the review by the RRT. By letter dated 19 July 2001 from the RRT, the first appellant was notified that the RRT had looked at all of the material relating to her application but was not prepared to make a favourable decision on that information alone. (That, as will later appear, was a response by the RRT to par (a) of s 425(2) of the Act.) The first appellant was invited "to come to a hearing of the [RRT] to give oral evidence, and present arguments, in support of [her] claims". (That was a discharge of the obligation of the RRT under 77 (2003) 211 CLR 441. 78 (2003) 211 CLR 441 at 457 [29]-[32], 471 [86]-[88]. 79 Part 7 is applicable in the form it took after the commencement of the Migration Legislation Amendment (Electronic Transactions and Methods of Notification) Act 2001 (Cth). s 425(1).) She also was told that she was entitled to ask the RRT "to obtain oral evidence from another person or persons". There followed written submissions from solicitors acting on her behalf which were received by the RRT on 1 August 2001. There were further communications, including written submissions by her new adviser, Dr Al Jabiri, received on 23 August 2001. On 5 September 2001, the RRT conducted a hearing. The complaints of failure to comply with s 424A and of denial of procedural fairness arise out of the conduct of the proceedings on that occasion. The RRT had before it the file of the Minister's department supplied, it would appear, by the Secretary under s 418 of the Act. The file included a record of interview on the arrival of the appellants in Australia, the protection visa application, a written statement in support of the application and a record of interview with an officer of the department. The RRT also had before it supplementary statements by the first appellant and the written submissions in support of the application for review which had been received on 1 August and 21 August 2001. The place of the hearing notified to the first appellant was at Woomera Hospital. She was at this stage detained at the Woomera Immigration Reception and Processing Centre. The presiding member of the RRT was at Sydney, as were the appellants' migration agent (Dr Al Jabiri), her daughter Ms Naghdi, the interpreter and several witnesses. During the proceedings, the presiding member took evidence on oath from Ms Naghdi in the absence, at his direction, of her mother from the hearing room at Woomera. As a result, she was unaware from the video link of what was being said in Sydney by her daughter. The first appellant had been sworn. After the evidence of Ms Naghdi was taken and the first appellant had returned, some of the topics covered in that evidence were put to her by the presiding member (Mr Lynch). One of these topics included an alleged violent attack on her whilst she had been living in Shiraz. The transcript of the proceeding then continues: "MR LYNCH: Thank you. I won't ask you any further questions about that but I may ask your adviser to inform me further. We do have to close the hearing now. Doctor, in view of the time, we have to adjourn now because the room is being used by another client. I have no further questions. Could I suggest that we adjourn the matter. I'm prepared to close the hearing now and receive written submissions, unless you want especially to make oral submissions. I'm happy to arrange another hearing time to receive oral submissions but in the circumstances I would prefer written submissions and I'd write to you indicating what matters I'd like to hear first. Thank you [Ms Naghdi]. INTERPRETER: I think she's talking about (indistinct) MR LYNCH: All right. Look, I will be giving close consideration to everything you've raised and I'll be talking with your adviser about other aspects of your case I need to hear about. I know it's been very stressful for you and you're going through a difficult time. I'll be trying to make a decision quickly in your case." (emphasis added) There was no such written communication from the RRT. The adverse decision was issued some six weeks later. It should be added that, at the outset, when outlining the procedures he proposed to follow, Mr Lynch had said: "Now, when witnesses are going to give evidence, I will ask that one of them stays outside while the other gives evidence, and when you or your daughter gives evidence I'll ask one or other of you to leave the room at that time. All right. I may in fact do that in relation to Mr Ahmed [a witness for the appellants] when he gives his evidence as well. Just briefly, a couple of things: during the hearing I will tell you about any information I have that is adverse to your claim, and you'll have an opportunity to comment on that information, and so will your adviser." The legislation As remarked earlier in these reasons, it is apparent that the "invitation" extended in the letter of the RRT dated 19 July 2001 had been an observance by the RRT of its obligation imposed by s 425 of the Act. Section 425 states: "(1) The [RRT] must invite the applicant to appear before the [RRT] to give evidence and present arguments relating to the issues arising in relation to the decision under review. Subsection (1) does not apply if: the [RRT] considers that it should decide the review in the applicant's favour on the basis of the material before it; or the applicant consents to the [RRT] deciding the review without the applicant appearing before it; or subsection 424C(1) or (2) applies to the applicant. If any of the paragraphs in subsection (2) of this section apply, the applicant is not entitled to appear before the [RRT]." However, the appeal turns upon earlier provisions in Pt 7. Central to the submissions for the appellants is the proposition that s 424A was engaged at the proceeding on 5 September 2001 at which evidence was taken. However, on its proper construction, s 424A had no role to play at the hearing on 5 September. Before examining these provisions, it should be noted that the Act also establishes (with a distinct jurisdiction) the Migration Review Tribunal ("the MRT"). Part 5 of the Act concerning review of decisions by the MRT substantially mirrors Pt 7 of the Act. In particular, Div 5 of Pt 5 reproduces the provisions of Div 4 of Pt 7 which are relevant to the resolution of this matter. The critical question in this case of the construction of s 424A is to be answered by having regard to its place in Div 4 and, in turn, the place of Div 4 in Pt 7 of the Act. The process of construction must always commence with an examination of the context in which the provision appears80. Part 7 (ss 410-473) is headed "Review of protection visa decisions". Division 2 (ss 411-419) is headed "Review of decisions by Refugee Review Tribunal". Having before it a valid application by the appellants under s 412 for review of the decision of the delegate of the Minister, the RRT was obliged by s 414 to review the decision. The obligation was expressed by the words in s 414 "the [RRT] must review the decision". Division 5 (ss 430-431), headed "Decisions of Refugee Review Tribunal", includes a requirement as to the preparation of a written statement by the RRT (s 430). Division 4 (ss 423-429A) deals with the conduct of the review preceding the recording of the decision of the RRT. Division 4 is headed "Conduct of review" and proceeds sequentially to detail the procedural steps which may or must be taken by the RRT. That some of the steps are permissive and some mandatory is reflected in the usage throughout Div 4 of "may" and "must". Division 4 distinguishes between the ultimate steps concerning appearance before the RRT to give evidence and present arguments (s 425) and the anterior provisions in s 424B which provide for interviews. There is a distinction between the provision of information or the making of comments at an interview under s 424B and the giving of evidence under s 425. The giving of evidence involves the exercise by the RRT of its powers under s 427 to take evidence on oath or affirmation (s 427(1)(a)) and to summon persons to appear to give evidence (s 427(3)(a)). 80 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at The inquisitorial process With these distinctions in mind, it is convenient to turn to a consideration of the sequence of procedural steps laid down in Div 4. It commences with the permissive provision in s 423 for supply of written arguments by the Secretary of the Minister's department and by the applicant, in each case relating to the issues arising with respect to the decision under review. The applicant may also provide a statutory declaration in relation to any matter of fact the applicant wishes the RRT to consider. The inquisitorial nature of the process is indicated by s 424. The RRT may get "any information that it considers relevant". However, the RRT is obliged to have regard to that information in making its decision. The getting of information by the RRT may be the result of an invitation by the RRT. Section 424 stipulates that such an invitation must be given by one of the methods specified in s 441A81 for the giving of documents or, if the recipient is in immigration detention, by a method prescribed for the giving of documents to such persons. The only methods prescribed are the giving of the document to the person in question or to another person authorised to receive documents on behalf of that person82. There follows s 424A. Whilst s 424 is concerned with the gathering of additional information by the RRT, s 424A in certain circumstances obliges the RRT to give to the applicant for review certain information. It is upon s 424A that the appellants place considerable reliance and its text should be set out: "(1) Subject to subsection (3), the [RRT] must: appropriate give to the applicant, in the way that the [RRT] circumstances, considers particulars of any the [RRT] considers would be the reason, or a part of the reason, for affirming the decision that is under review; and information that the ensure, as far as is reasonably practicable, that the applicant understands why it is relevant to the review; and invite the applicant to comment on it. 81 Section 441A is included in Div 7A (ss 441AA-441G), which is headed "Giving and receiving review documents". 82 Migration Regulations 1994 (Cth) , reg 5.02. The information and invitation must be given to the applicant: except where paragraph (b) applies – by one of the methods specified in section 441A; or if the applicant is in immigration detention – by a the purposes of giving method prescribed for documents to such a person. This section does not apply to information: that is not specifically about the applicant or another person and is just about a class of persons of which the applicant or other person is a member; or that the applicant gave for the purpose of the application; or that is non-disclosable information." It will be apparent from s 424A(2) that it replicates what might be called the service provisions already found in s 424 with a reference to the methods stipulated in s 441A and to prescribed methods for persons in immigration detention. Section 424A(3)(c) qualifies what otherwise is the obligation under sub-s (1) that the RRT give the applicant information the RRT considers would be a reason or part of the reason for affirming the decision. It does so by excepting "non-disclosable information". That term is the subject of a lengthy definition in s 5(1). It includes information or material which in the opinion of the Minister would be contrary to the national interest or the public interest. Paragraph (b) of s 424A(3) relieves the RRT from what otherwise might be an obligation to give particulars of information already supplied by the applicant for the purpose of the application. In Minister for Immigration and Multicultural Affairs v Al Shamry83, the Full Court indicated that the subject- matter of the exception is information provided by the applicant for review by statutory declaration under par (a) of s 423(1) and in response to an invitation by the RRT under s 424(2). That construction was not challenged on this appeal and should be accepted. Paragraph (a) of s 424A(3) qualifies the obligation of the RRT by excepting from the need of disclosure that information which is "just about a 83 (2001) 110 FCR 27 at 34, 38-39. class of persons". No question of the construction of this paragraph arises on the present appeal. In the original jurisdiction of this Court, Kirby J has referred to the possibility that par (a) does not extend to information referring to the social and political conditions of the country concerned, including changes said to disentitle the applicant for refugee status84. But this is not the occasion further to consider that issue. What can be stated is that the evident object of s 424A is that, with the qualifications and exceptions just mentioned, fairness to the applicant is to be provided by alerting the applicant to adverse material and affording an opportunity to comment upon it. In Al Shamry85, Merkel J correctly observed: "Section 424A does not require the RRT to provide to an applicant all of the information upon which it proposes to act, other than information provided by an applicant for the purpose of the review. Rather, the section requires the RRT to provide the applicant with 'particulars of any information' that the RRT considers would form part of its reason for refusing the application for review, to explain to the applicant why that information is relevant to the review and to invite a response to it." There was debate in submissions as to the statement in par (a) of s 424A(1) that the "particulars" of the information be given to the applicant "in the way that the [RRT] considers appropriate". The phrase "in the way" is to be read with the requirement in sub-s (2) that the information (and invitation to comment) be given as there specified. Where the applicant is not in immigration detention, this may be by any one of the methods specified in s 441A and it will be for the RRT to select which of those methods it considers to be appropriate. However, where the applicant is in immigration detention, s 441A is not picked up and the method, to be selected by the RRT as appropriate, must be one of those prescribed. Section 424B has two operations in the inquisitorial procedures of the RRT. The first is attached to s 424 and is concerned with invitations thereunder to give additional information to the RRT; such invitations, in the terms of s 424, may be given to "a person", a term including but not limited to the applicant. The second operation of s 424B is with respect to invitations given by the RRT under s 424A to comment on information; such invitations, given the terms of s 424A, are limited to the applicant. 84 Re Minister for Immigration and Multicultural Affairs; Ex parte A (2001) 185 ALR 85 (2001) 110 FCR 27 at 40. The invitation given by the RRT is to specify the way in which the material may be given "being the way the [RRT] considers is appropriate in the circumstances" (s 424B(1)). Two methods are then provided. The invitation may be to give information or comments at an interview (s 424B(3)) or "otherwise than at an interview" (s 424B(2)). Section 424C authorises the RRT to make a decision without taking any further action to obtain additional information invited from a person under s 424 (s 424C(1)). Section 424C also authorises the RRT to make a decision without taking any further action to obtain the views of the applicant of information, comments upon which have been invited under s 424A (s 424C(2)). In each case, the RRT is authorised to proceed in this fashion where the information or comment has not been given before the passing of time specified under s 424B in the invitation. The text of s 425 has been set out. The RRT is obliged to invite the applicant to appear to give evidence and present arguments relating to the issues arising with respect to the decision being reviewed. However, the RRT is not obliged to invite the applicant to appear to give that evidence and present arguments in the circumstances specified in s 425(2). One of these circumstances appears in par (c). It is that there has been a failure of the kind indicated in s 424C, namely that a person has been invited to give additional information under s 424 or that the applicant has been invited to comment under s 424A but has not utilised those opportunities. On the other hand, if the RRT on the materials does consider it should decide the review in favour of the applicant, then it is not obliged to take the matter further by inviting the applicant to appear to give evidence and present arguments (s 425(2)(a)). Thus, in a particular case, the comments furnished by the applicant, pursuant to s 424B, upon the particulars of information supplied by the RRT under s 424A, may lead the RRT to determine under par (a) of s 425(2) that it will decide the application in the applicant's favour without going to a hearing under s 425(1). Conclusions respecting s 424A It will be apparent from the foregoing that what transpired at the hearing conducted under s 425 in the present case did not enliven s 424A. Nor would events after conclusion of the hearing and before the recording of the decision of the RRT. The specific reference in par (c) of s 425(2) back to s 424C, and thus to s 424A, and the failure to take up an invitation thereunder to comment on information, indicates the sequential chain which is provided through Div 4. Section 424A operates at a time before and may operate to qualify the discharge by the RRT of its obligation under s 425(1) to invite the applicant to appear to give evidence and present arguments. Review powers following appearance under s 425 From the foregoing it will be apparent that, as well as s 424A, s 424 (gathering additional relevant information by the RRT) is also limited in operation to a time before s 425 is engaged. This sequential understanding of Div 4 does not deny that, following an appearance by the applicant under s 425 to give evidence and present argument, the RRT is empowered to obtain further information from the applicant or any other person that it may consider to be relevant to its decision. Section 415(1) provides that the RRT may, for the purposes of review, exercise all the powers and discretions that are conferred by the Act on the Minister, or her delegate, in respect of the original decision. Subdivision AB of Div 3, Pt 2 of the Act, headed "Code of procedure for dealing fairly, efficiently and quickly with visa applications", provides in s 56 that the Minister may get any information that she considers relevant in making the decision, and that the Minister must have regard to that information in making the decision. Where the Minister delegates her decision-making powers under s 496(1), the delegate may also exercise the power conferred by s 56. The conferral of this and other powers in the Act, through the conduit of s 415(1), begs the question, what purpose do ss 424, 424A, 424B and 424C serve? These provisions, along with ss 425 and 425A, were inserted by the Migration Legislation Amendment Act (No 1) 1998 (Cth)86 ("the Amending Act") and replaced the former ss 424 and 425. Previously, s 424, headed "Review 'on the papers'", provided that, if the RRT was prepared to make a decision favourable to the applicant, the RRT might do so without "taking oral evidence". The expression "taking oral evidence" was a reference to the former s 425 which was headed "Where review 'on the papers' is not available". Section 425 provided that where s 424 did not apply (ie a favourable decision on the papers could not be made) the RRT "must give the applicant an opportunity to appear before it to give evidence" (emphasis added). Unlike the provisions inserted by the Amending Act the former s 424 contained an important limit on what constituted "the papers". Namely, that expression comprised only the documents given to the Registrar under s 418 (the file the Secretary to the Minister's department had supplied) and s 423 (statutory declarations and written arguments provided by the Secretary of the Minister's department and by the applicant in relation to the decision under review) of the Act. Thus, and significantly for the procedures of the RRT, the general powers 86 Another aspect of this Act was considered in WACB v Minister for Immigration and Multicultural and Indigenous Affairs (2004) 79 ALJR 94; 210 ALR 190. conferred upon the RRT by s 415(1) of the Act were not available to the RRT to expand the documentary evidence available before s 425 was engaged. When viewed against this backdrop, the changes made by the Amending Act appear to facilitate the making of a decision at an earlier stage in the review. Prior to s 425 being engaged, the RRT was enabled to expand the documentary evidence before it. Thus the RRT was assisted in making a favourable decision without needing to give the applicant an opportunity to appear before it and give evidence – a procedure that may be costly and not always efficient. Therefore, the purpose of ss 424, 424A, 424B and 424C as amended is to improve the efficiency of the RRT's procedures by compelling the RRT to obtain the maximum amount of documentary information that may be available before resorting to the procedure in s 425. Accordingly, despite the existence of similar (if not identical) powers conferred by s 415(1), the Act compels a sequential process upon the conduct of the review by the RRT. Other aspects of the Amending Act reinforce this purpose. It is sufficient to quote from the explanatory memorandum on the Bill for the Amending Act: "3. The amendments to the Migration Act 1958 in relation to the system of merits review of immigration decision-making: merge the Migration Internal Review Office (MIRO) and the Immigration Review Tribunal (IRT) into a new body to be called the Migration Review Tribunal (MRT); provide the Principal Members of the MRT and the Refugee Review Tribunal (RRT) with clear authority to apply efficient processing practices, including giving the Principal Member of the RRT clear authority to give directions on the operation of the RRT and the conduct of reviews; specify the circumstances when the Principal Member of the MRT or the RRT may reconstitute a Tribunal for the more efficient conduct of the review; allow the Minister to appoint a person to act as a Senior Member of the RRT for a period of no more than 12 months; prevent MRT and RRT hearings from being unnecessarily delayed where: – prescribed notice of a personal hearing has been provided and no change has been sought; or – an applicant fails to respond to an invitation to give additional information within the prescribed period (or a further prescribed period)". (emphasis added) The other obvious purpose of s 424A and the associated provisions is to provide a procedure to deal fairly with RRT applications87. The provisions provide a statutory regime for the according of procedural fairness but in the limited circumstances discussed. However, as discussed later in these reasons, the RRT continues to owe obligations of procedural fairness after the provisions are spent88. Such obligations accompany the general conferral of powers found in s 415 and the specific powers provided for in Pt 7, Div 4 that remain operative89. Thus, the obligation to deal fairly with applications for review continues throughout the RRT's review. The sequential approach to the relevant provisions does not, for example, produce the result noted as follows by the Full Court of the Federal Court in SRFB v Minister for Immigration and Multicultural and Indigenous Affairs (Ryan, Jacobson and Lander JJ)90: "His Honour [the primary judge] pointed out that to adopt such a rigid sequence would mean that if the RRT learned of, or realised at or shortly before implications of certain information which attracted the application of s 424A, the RRT would have to cancel or adjourn the hearing without then exploring the significance of the information. the potential the hearing, His Honour said that the consequence would be a series of abbreviated hearings if further information comes to light." 87 Section 420(1) of the Act provides: "The Tribunal, in carrying out its functions under this Act, is to pursue the objective of providing a mechanism of review that is fair, just, economical, informal and quick." 88 cf Re Minister for Immigration and Multicultural Affairs; Ex parte Epeabaka (2001) 206 CLR 128 at 138-139 [28]. 89 See Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82 at 99-101 [38]-[41], 142-143 [168]-[169]; Re Minister for Immigration and Multicultural Affairs; Ex parte Miah (2001) 206 CLR 57 at 83-88 [90]-[105], 95-98 [131]-[143], 90 [2004] FCAFC 252 at [36]-[37]. Such a result assumes there are no other powers to present adverse information to the applicant and, crucially, ignores the obligations to accord procedural fairness that are enlivened upon the giving of the invitation to appear before the RRT. Likewise, it would be wrong to assume that the RRT would not be required to provide to the applicant any adverse information which emerged when a third person gave evidence to the RRT at a hearing. "May" and "must" in Division 4 It is not necessary for the disposition of the present case to determine the consequences of a failure to observe steps in the chain of provisions in Div 4 which are expressed in imperative terms by use of the term "must" in some provisions in contrast to "may" in others. However, given the detailed argument on the point and varying views in the Federal Court, something should be said on the point. Counsel for the Minister emphasised that "must" and "may" in a given context need not necessarily bear what might be thought their primary character. As a general proposition, that may be accepted. However, s 33(2A) of the Acts Interpretation Act 1901 (Cth) indicates that in Div 4 the word "may" is used to show that acts or things may be done at discretion of the person or body concerned. Further, Div 4 manifests a carefully poised juxtaposition of the words "may" and "must" to indicate a distinction between a power and a duty imposed upon the RRT. Indeed, the root of the distinction in the legislation may be found in the primary provision in s 414 (in Div 2) that, if a valid application be before it, the RRT "must review the decision". That review is to be conducted in accordance with the procedures, partly imperative, partly permissive, specified in Div 4. Those procedures culminate in the recording of the decision expressed in the imperative term "must prepare a written statement" by s 430 (in Div 5). Counsel for the Minister sought support from a passage in the judgment of the Full Court of the Federal Court in NAHV of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs91. Their Honours concluded that any failure to comply with s 424A(2) by providing the invitation through the medium of a document was a failure which was in "procedure" and not one of "substance". Their Honours reserved for consideration the consequences of a failure to observe the apparently imperative requirement of s 424A(1). However, their Honours' views were expressed in a setting where, in the course of a hearing under s 425, the RRT had advised the applicant that it had certain information available to it that was potentially adverse to the applicant's interests and had then discussed this with the applicant92. NAHV thus concerned an alleged 91 (2003) 129 FCR 214 at 219-220. 92 (2003) 129 FCR 214 at 217. operation of s 424A in a situation corresponding to that of the present case, that is to say, in the course of the giving of evidence and presentation of arguments under s 425. However, at that stage, the section had no function to perform. Seen in its proper place in the procedural chain specified in Div 4, s 424A mandates the fairness in the treatment of applicants for review which is an inviolable requirement attaching to the exercise of the jurisdiction of the RRT attracted by s 414 and continuing through to the preparation of the written statement of decision under s 430. It thus answers the description of an imperative duty to observe the stipulations of the Act and entailing review for jurisdictional error under s 75(v) of the Constitution or s 39B of the Judiciary Act. Procedural fairness There remains the alternative submission that, s 424A apart, the conduct of the hearing on 5 September 2001 has been vitiated by a denial of procedural fairness to the first appellant. Reference has been made under the heading "Review powers following appearance under s 425" to the general powers enjoyed at this stage by the RRT by a combination of ss 56 and 415(1) of the Act. That a denial of procedural fairness at this stage would attract a remedy for jurisdictional error is indicated by Re Refugee Review Tribunal; Ex parte Aala93 and Re Minister for Immigration and Multicultural Affairs; Ex parte Miah94. What should be added, however, is that what might be called the "common law" requirements of procedural fairness in a given case do not have the rigidity of the statutory imperatives of s 424A and associated provisions. It should be noted that this case concerns the Act in a form before the addition of s 422B in Div 495. The new section states that Div 4 "is taken to be an exhaustive statement of the requirements of the natural justice hearing rule in relation to the matters it deals with". No question presently arises concerning the validity or operation of s 422B. In his detailed reasons, the primary judge (Mansfield J) dealt with the matter on the assumption that what he called "the rules of procedural fairness at common law" applied at the hearing. He concluded: 93 (2000) 204 CLR 82. 94 (2001) 206 CLR 57. 95 By the Migration Legislation Amendment (Procedural Fairness) Act 2002 (Cth). "I do not consider that those common law rules were breached by the [RRT] in this instance. The [first appellant] had an opportunity to put her case, and was aware of the matters which were of significance to her case which emerged from the evidence of her elder daughter. She also had an opportunity of responding to those matters, partly by what was put to her during the hearing and partly by being able to make submissions about those matters following the hearing96." In short, the requirement that the first appellant withdraw from the hearing room during the questioning of her elder daughter did not, as it transpired, deprive her of the opportunity to learn of material adverse to her claim or to comment upon it. Conclusions The appellants have not made out a case that the decision of the RRT is rendered infirm for jurisdictional error. The appeal should be dismissed with costs. 96 See eg Minister for Immigration and Multicultural Affairs; Ex parte Miah (2001) 206 CLR 57 at 86 [99] per Gaudron J and the cases cited by her Honour. Kirby 143 KIRBY J. This appeal from a judgment of the Full Court of the Federal Court of Australia97 concerns issues of procedural fairness, under the Migration Act 1958 (Cth) ("the Act") and by the common law, as those issues affect an application for protection visas made by two Iranian nationals − an adult woman and her daughter98. By the Act, the provision of such visas to persons who are "refugees" within the Refugees Convention, as amended by the Refugees Protocol99, constitutes the way in which this country discharges its obligation to those claiming protection upon that ground. In the circumstances disclosed in other reasons, the essential complaint of the appellants, both in terms of the Act and of the general law, is that they were denied procedural fairness. In particular, they complain that they were not given proper notice of information about circumstances that the Tribunal procured in evidence taken in private from the eldest daughter of the first appellant, resident in Australia, which clearly played a part in the Tribunal's reasoning, affirming the decision under review. Nor were the appellants informed why that information was relevant to the review. Nor were they invited to comment on it. This was so, despite explicit assurances given to the first appellant in the hearing by videolink, based on an exchange between the member constituting the Tribunal, the first appellant's agent and her interpreter and witness. Those persons were in Sydney. The first appellant was then in immigration detention in Woomera100. The appellants are entitled to succeed. The appeal should be allowed. The facts, decisional history and legislation The background facts are stated in other reasons101. The first appellant, SAAP, is the mother of the second appellant who is an infant. Mother and daughter are adherents of the Sabian Mandean religion, a pre-Christian faith with similarities to other Semitic religions, whose members are allegedly subject to persecution in Iran. 97 SAAP of 2001 v Minister for Immigration and Multicultural and Indigenous Affairs [2002] FCAFC 411. 98 The Act, s 36. 99 The Convention relating to the Status of Refugees done at Geneva on 28 July 1951, [1954] Australian Treaty Series No 5; The Protocol relating to the Status of Refugees done at New York on 31 January 1967, [1973] Australian Treaty Series 100 The exchange is set out in the reasons of Gummow J at [101]. 101 Reasons of Gleeson CJ at [10]-[11]; reasons of Gummow J at [87]-[89]. Kirby The appellants' application for protection visas was rejected by the delegate of the Minister in June 2001. There followed an application under the Act for review by the Refugee Review Tribunal ("the Tribunal"). This proved adverse to the appellants. The appellants then applied to the Federal Court of Australia for judicial review. Their application was dealt with as an application under s 39B of the Judiciary Act 1903 (Cth) ("the Judiciary Act")102. The application failed at first instance. An appeal to the Full Court of the Federal Court was dismissed103. Both at first instance and on appeal it was found that the Tribunal had not complied with s 424A of the Act in relation to the appellants104. Nevertheless, the primary judge refused relief, essentially upon discretionary grounds, being of the view that "in substance" the objective of s 424A of the Act had been achieved105. The Full Court also accepted that a breach of s 424A had occurred, because the Tribunal had "failed to give the appellant particulars of the information [upon which it had relied in reaching its adverse decision] in writing"106. Indeed, the Full Court recorded that the "Minister does not contend to the contrary of this finding"107. Nevertheless, the Full Court rejected the appeal upon the basis of the then understanding of s 474 of the Act ("the privative clause")108. It held that the privative clause operated "to render effective the decision [of the Tribunal] despite a breach of s 424A"109. Soon after the decision of the Full Court, this Court published its reasons in Plaintiff S157/2002 v The Commonwealth110. The different view adopted by 102 SAAP v Minister for Immigration and Multicultural and Indigenous Affairs [2002] FCA 577 at [1] per Mansfield J. 103 SAAP [2002] FCAFC 411 at [23]. 104 SAAP [2002] FCA 577 at [45] per Mansfield J; SAAP [2002] FCAFC 411 at [23] per Heerey, Moore and Kiefel JJ. 105 SAAP [2002] FCA 577 at [50]. 106 SAAP [2002] FCAFC 411 at [14]. 107 SAAP [2002] FCAFC 411 at [14]. 108 SAAP [2002] FCAFC 411 at [16]-[23]. 109 SAAP [2002] FCAFC 411 at [23]. 110 (2003) 211 CLR 476. Kirby this Court in that decision concerning the ambit of the privative clause to exclude judicial review in a case of breach of "imperative duties" and "inviolable limitations or restraints" established by the statute (or the denial of fundamental rights of procedural fairness recognised in the general law) invalidated the basis of the Full Court's decision in this case. Now, by special leave, the appeal is before this Court for disposition. The relevant provisions of the Act, breach of which the appellants complain of − and specifically s 424A − are also set out or described in other reasons111. It is unnecessary to repeat these provisions. However, as is evident from the reasons of the other members of this Court, the solution to the principal issue that engaged most of the argument in this Court concerning the meaning and effect of s 424A can only be reached after a careful examination of that section in the context of the Act. It is necessary to approach that task having regard to the purposes that should be attributed to the Parliament in enacting that provision in the terms adopted. The issues Five issues arise in the appeal. The procedural issue: Whether the proceedings, as initiated in the Federal Court and in this Court, omitting the Tribunal as a party for the relief sought under s 39B of the Judiciary Act, were correctly constituted and sufficient having regard to the provisions of the Act112? The statutory issue: Whether, having regard to the terms of the Act and specifically s 424A, the Tribunal was bound to give the appellants written notice of the information it had obtained from the eldest daughter, having regard to the large significance of that information as the reason, or part of the reason, for affirming the decision under review? The procedural fairness issue: Whether, if breach of the procedural requirements of s 424A was not proved, the appellants had otherwise established breach of the requirements of the general law governing procedural fairness binding on the Tribunal, either as an implication to be imputed to the Parliament in enacting the Act or by reason of the common 111 See reasons of Gleeson CJ at [1]-[8]; reasons of Gummow J at [104], [107]-[110], [113]; reasons of Hayne J at [182]. Kirby law, treated as still applicable in the absence of clearly inconsistent provisions of the Act?113 The jurisdictional error issue: Whether, either for breach of the procedural requirements of s 424A of the Act or of the requirements of procedural fairness under the general law, the appellants had demonstrated such jurisdictional error as would permit the provision of relief to them in their proceedings by way of judicial review in the Federal Court? The discretionary issue: Whether, should such relief be available, as a matter of law, and notwithstanding ss 477 and 479 of the Act, relief under s 39B of the Judiciary Act, by way of the constitutional writs (supplemented by other remedies available under that Act), should be withheld on discretionary grounds, having regard to the circumstances established by the evidence in this case? The procedural issue Upon the procedural issue, like Hayne J114, I am in agreement with Gummow J115, for the reasons that he gives. It was necessary for the Tribunal to be joined as a party to the proceedings in the Federal Court and in this Court. It was for the reasons given by Gummow J that I joined in the procedural order made by this Court during the hearing requiring that the Tribunal be added as the second respondent. The statutory issue Sequential v ambulatory approach: The second issue represents the centrepiece of this appeal. It is the point upon which differing views have been expressed in this Court. The essential question is whether the provisions in Pt 7, Div 4 of the Act, as applicable at the relevant time, are to be treated as having a sequential operation (as Gleeson CJ116 and Gummow J favour117). Or whether 113 See generally Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82 at 99-101 [38]-[42], 142-143 [168]; Re Minister for Immigration and Multicultural Affairs; Ex parte Miah (2001) 206 CLR 57 at 74-75 [52]-[53], 83-84 [89]-[90], 107 114 Reasons of Hayne J at [180]. 115 Reasons of Gummow J at [91]. 116 Reasons of Gleeson CJ at [18]. 117 Reasons of Gummow J at [124]. Kirby they are to be given an ambulatory operation so as to engage the performance by the Tribunal of its functions wherever, by their terms, those provisions apply to the circumstances of the case (as favoured by McHugh J118 and Hayne J119). I support the analysis of Hayne J. I agree in his Honour's reasons as they relate to the language and structure of the applicable Division of the Act. To those reasons I would add a number of reasons of my own. Sequential statutory drafting: First, there is the way legislation, including federal legislation, is typically drawn. It is conventional for parliamentary counsel to arrange provisions of an Act of Parliament in an order which will appear logical to the mind of the administrator or other person called upon to apply the law and to the lawyer called upon to interpret it. However, in the nature of legislation, required, as it commonly is, to address multiple and unforeseeable circumstances, it is almost impossible to envisage, and provide for, every case to which the statute will apply. If a general logic in the presentation of statutory provisions is attained, that is as much as can usually be hoped for. Ordinarily, at least in the absence of clear provisions demanding a strictly sequential operation, it should not be assumed that an unyielding sequence was intended. Such an approach would restrict the ambit of the operation of the provisions of an enactment in a way that would circumscribe the operation of the law. It would reduce the capacity of the law to apply to the multitude of cases to which, by its terms, it may otherwise apply. It would do so for no reason better than the arrangement of the statutory provisions. Yet that arrangement may have another logical explanation, quite different from sequential operation of those provisions. A general chronological sequence in the provisions of an Act may represent nothing more than the attempt of the drafter to arrange the provisions in an order whose chronological lay-out will make it generally simpler for persons using the Act to find a relevant provision quickly. Because statutes address the affected community at large and normally speak from time to time applying to circumstances that may be very different as time passes,120 it is ordinarily a mistake to impose upon their provisions interpretations that narrow their operation, limiting language general in its terms so that its application is exhausted once earlier steps, suggested by the chronological sequence, are taken. 118 Reasons of McHugh J at [60]-[63]. 119 Reasons of Hayne J at [202]. 120 See eg Fitzpatrick v Sterling Housing Association Ltd [2001] 1 AC 27. See also Coleman v Power (2004) 78 ALJR 1166 at 1211 [246]; 209 ALR 182 at 244-245. Kirby Where the language is general in its terms, courts should be circumspect in confining the operation of the text on the basis of an inference drawn from the chronological arrangement of the provisions. The provisions have to be organised in some order. Chronological presentation is a natural one to choose. But (without clear language) choosing it does not ordinarily imply a strictly sequential application that results in the exhaustion of the operation of a provision earlier in the arrangement although by its terms, it could still apply to ongoing circumstances. The search always is for the purpose of the Parliament, derived from the language in which that purpose is expressed. Absence of express limitation: Secondly, when s 424A of the Act is examined, its language does not contain an express limitation confining its operation to a step in a sequence of events so that the section can only apply to a step taken before the appearance of the applicant in the Tribunal's hearing as envisaged by s 425(1). Such an express limitation could easily have been included, if that had been the purpose of the Parliament. For example, it would have been simple to include in the opening text of s 424A(1) words making it clear that the section applied only "in respect of the documents referred to in s 423 or the additional information referred to in s 424". No such words of limitation in the application of s 424A were enacted. In the absence of such an express limitation in the language of s 424A (a section in any case added to the statutory provisions after their first enactment) this Court should be slow to add such words to those adopted by the Parliament or to conclude that such words, although omitted, are to be found between the lines. Express regulation of the review: Thirdly, the purpose of Pt 7, Div 4 of the Act, in which s 424A appears, is to provide a series of powers to, and to cast obligations upon, the Tribunal for (as the title of the Division describes it) the "Conduct of review". The addition of s 424A to these general provisions governing the conduct of the review must be seen as an attempt by the Parliament to provide a general scheme to ensure that such review is conducted with scrupulous fairness for the often vulnerable persons invoking the Tribunal's jurisdiction and powers. Given the overall purpose of the Parliament, so described, there would need to be clear language in s 424A (or elsewhere in the context) to require the general words of that provision to be read down so as to deny its operation, despite its ample terms, where, following a hearing of the Tribunal as mandated in the given circumstances by s 425(1), an issue arises that the Tribunal "considers would be the reason, or a part of the reason, for affirming the decision that is under review"121. 121 The Act, s 424A(1)(a). Kirby What would be the purpose of the Parliament in denying the application of s 424A(1) to such a case? The suggestion of undue inflexibility is scarcely persuasive122. The provisions of the Division are unusually detailed, specific and particular. They may doubtless be seen as inflexible by some officials. But they are dealing with unusually important decisions. A measure of inflexibility is the will of the Parliament so as to protect the rights to due process of those affected. Nor is it persuasive to say that the interpretation adopted affects the capacity of the Tribunal to act in an "economical, informal and quick"123 way. That requirement in s 420(1), is obviously subject to the express provisions of the Act. It cannot excuse non-compliance with the Act's explicit requirements. In any case, the legislature has also commanded that the conduct of the review be "fair" and "just". This is the end that s 424A is seeking to attain. Clearly, it is entirely possible that a case would arise where new circumstances only come to light during the Tribunal hearing and are critical to the reasoning of the Tribunal (as the appellants say occurred in this case). Indeed, that is the very nature and purpose of the hearing for which s 425(1) of the Act provides. That sub-section requires that the Tribunal must invite the applicant to attend the hearing. In a series of provisions collected in a Division of the Act which generally governs the "Conduct of review", the more natural reading of s 424A is therefore that it operates throughout such review conduct and is not spent at the earlier stage before any hearing by the Tribunal is conducted. In default of such an interpretation, it is left wholly to the general law to govern the duties of the Tribunal in respect of disclosure to those affected of a new and critical circumstance arising during the hearing. A more natural reading is to apply to such a circumstance the provision expressly enacted by the Parliament and collected in this Division governing the conduct of such reviews. Emphatic terms of the provisions: Fourthly, it is relevant to have regard to the emphatic language in which s 424A is expressed ("the Tribunal must")124. Similar emphasis appears in other obligations contained in this Division of the Act, including the provision requiring the Tribunal to invite the applicant to appear before it in the specified circumstances125. Such provisions contrast with the permissive language appearing elsewhere in Pt 7, Div 4 of the Act, including in relation to the provision of documents under s 423 and the acquisition of 122 Reasons of Gleeson CJ at [16]. 123 Reasons of Gleeson CJ at [1]. 124 The Act, s 424A(1) (emphasis added). 125 The Act, s 425(1). See also ss 425A(1), 426(1). Kirby additional information under s 424. I agree with what Gummow J126 and Hayne J127 have written about this differential use of the respective verbs of command and discretion. Whereas, nowadays, "must" is sometimes used without such imperative overtones, in the juxtaposition of language in Pt 7, Div 4 of the Act, it must be assumed that the Parliament, when it used "must", had imperative obligations in mind. Although this does not, of itself, resolve the sequential issue, it does make it much less likely that the imperative command of notification of the kind of "circumstances" mentioned in s 424A − if so important at the earlier stage − would be overlooked or ignored by the Parliament at the later stage in the Tribunal's deliberations in and following a hearing. Indeed, in practical terms, the Parliament could be taken to know that it was likely to be much more important that notification should be given of new circumstances emerging in the hearing, likely to influence the ultimate decision, than in respect only of circumstances arising at the earlier stage on the basis of documents and additional information. If it was so important that such notification must be expressly given earlier, it was important later and even more so as the Tribunal approached the moment most critical of all to an applicant − that involving the possibility of formulating the Tribunal's reasons adverse to the applicant, that is, "affirming the decision that is under review". Upholding the Refugees Convention: Fifthly, there is the consideration that the provisions for the conduct of a review constitute part of the machinery for the fulfilment of important obligations undertaken by Australia under the Refugees Convention and Protocol. If there is an ambiguity in the Act, said to arise from the sequence of the sections and the place which s 424A takes in that sequence, the ambiguity should be resolved by holding that the Parliament has expressly enacted an obligation in the Tribunal − before and after any hearing and before the decision referred to − to notify an applicant in the way provided of any new circumstances which the Tribunal considers "would be the reason, or a part of the reason, for affirming the decision that is under review" and which has not earlier been notified. This is, after all, simply an express provision to ensure that the Tribunal's procedures attain the highest standards of justice to the applicants before it. As this Court has pointed out in the past, such applicants are frequently in a 126 Reasons of Gummow J at [133]-[136]. 127 Reasons of Hayne J at [206]. Kirby desperate situation and, in some cases, their safety and even their lives may be at stake in the important decisions that the Tribunal makes128. The accepted construction: Sixthly, the foregoing interpretation of the Act is not heterodox or surprising. Indeed, as revealed in the decisional record, it was accepted by the primary judge that s 424A applied and was breached in this case. The Full Court of the Federal Court was likewise willing to make that assumption. It recorded that it was not a conclusion challenged by the Minister. In my opinion, first thoughts were best. The section was engaged. The question is therefore whether it was breached. The procedural fairness issue Having regard to the conclusion on the statutory issue, it is unnecessary, in the circumstances of this case, to reach any final conclusion on the availability of a complaint of procedural fairness under the general law and, if available, to decide whether that complaint was made out. However, in passing this issue by, I would not wish it to be thought that I regarded the appellants' complaints under the general law as lacking substance. An analysis of the sequence of the proceedings before the Tribunal and what the Tribunal member told the first appellant in Woomera alongside the reasons of the Tribunal in this case inclines me to the belief that procedural unfairness, outside the requirements of s 424A, occurred in this instance. It may have arisen because of the pressures of time imposed on the Tribunal as evident in the final exchange between the Tribunal and the first appellant and her agent. However that may be, it is certainly open to interpret that exchange as being a promise to fulfil the kind of obligation that s 424A envisages. In the event, there was no communication between the end of the hearing and the decision of the Tribunal six weeks later, in writing or otherwise. Section 424A was, as the Federal Court found or assumed, breached. The jurisdictional error issue Nevertheless, is breach of s 424A sufficient to establish jurisdictional error necessary for relief in this case? Because of the mandatory language of s 424A ("must") and the provisions of Pt 7, Div 4, I agree with Hayne J129 that the breach is sufficient to constitute jurisdictional error, as that opaque expression has been interpreted. An imperative obligation for the conduct of a review by the 128 See Abebe v The Commonwealth (1999) 197 CLR 510 at 577-578 [191] per 129 Reasons of Hayne J at [204]-[208]. See also reasons of McHugh J at [77]. Kirby Tribunal has not been complied with. The will of the Parliament must be obeyed. The resulting decision of the Tribunal is not, therefore, one protected by the Act from judicial review in the Federal Court. The discretionary issue I also agree with Hayne J that such submissions as were advanced for the refusal of relief on discretionary grounds are unconvincing and should be rejected130. It may be difficult for some to appreciate the importance of written communications of critical facts in a legal setting. But the Parliament understood the need for it and so provided in s 424A of the Act. A written communication will ordinarily be taken more seriously than oral exchanges. People of differing intellectual capacity, operating institution of a different culture, communicating through an unfamiliar language, in circumstances of emotional and psychological disadvantage will often need the provision of important information in writing. Even if they cannot read the English language − or like the appellants, any language − the presentation of a tangible communication of a potentially important, even decisive, circumstance from the Tribunal permits them to receive advice and give instructions. in an The appellants had lost the assistance of a lawyer (inferentially acting pro bono) who had earlier represented them. They had an agent, although he was half a continent away, presumably retained by the eldest daughter. It is precisely for such a case that the provision of written communication was contemplated by the Parliament. It is not a needless formality or an inflexible imposition. It is a prudent procedure enacted to take into consideration the exact circumstances of a case such as the present. It was obligatory to comply with it. Indeed, the Tribunal in effect promised compliance; but failed to do so. The discretionary considerations overwhelmingly favour the provision of relief. Orders It follows that I agree in the orders proposed by Hayne J. 130 Reasons of Hayne J at [210]-[211]. See also reasons of McHugh J at [79]-[84]. Hayne 178 HAYNE J. In conducting a review of the decision of a delegate of the Minister to refuse the appellants protection visas, the Refugee Review Tribunal took evidence on oath from the first appellant's eldest daughter. That daughter had come to Australia before the appellants and had been granted a protection visa. The Tribunal later used what the daughter said (about why the family had left their country of origin, Iran, and about whether family members had been denied education because they were not Muslim) as reasons to affirm the decision under review. This appeal raises three questions. Was the Tribunal bound to give the appellants written notice of the information it obtained from the eldest daughter? If it was, did its failure to do so constitute jurisdictional error or a want of procedural fairness? If those questions are resolved in the appellants' favour, should the discretion to grant relief of the kind the appellants seek be exercised in their favour? The facts and circumstances giving rise to these questions and the procedural history of the matter are described in the reasons of Gummow J. As Gummow J points out, it is necessary first to notice a procedural question about the constitution of the proceedings. For the reasons given by Gummow J, the Tribunal should have been, and now has been, joined as a party to the proceedings. I have reached a different conclusion, however, about whether the Tribunal was bound to give the appellants written notice of the information it obtained from the first appellant's eldest daughter. I consider that the Tribunal was bound to give the appellants written notice of that information and to ensure, so far as reasonably practicable, that the appellants understood why it was relevant to the review. The Tribunal's failure to do so constituted jurisdictional error. The third question, about relief, should be resolved in the appellants' favour. The first two questions raised in the appeal (was the Tribunal bound to give written notice of the information; what are the consequences of failing to do so) require consideration of the meaning and operation of Pt 7 of the Migration Act 1958 (Cth) ("the Act") as it stood at the relevant time and, in particular, Div 4 of that Part (ss 423-429A). (It is convenient to continue to speak of the provisions in the present tense despite there having been subsequent changes to them.) The appellants' contentions focused upon one provision of Div 4, s 424A. Section 424A Section 424A provides that the Tribunal must give an applicant for review of a protection visa decision "particulars of any information that the Tribunal considers would be the reason, or a part of the reason, for affirming the decision that is under review". The section also requires the Tribunal to "ensure, as far as is reasonably practicable, that the applicant understands why [the information] is relevant to the review". Sub-section (3)(a) provides that the section does not Hayne apply to information "that is not specifically about the applicant or another person and is just about a class of persons of which the applicant or other person is a member". Other exceptions to the reach of s 424A, provided for by s 424A(3), are not relevant. For the reasons given by Gummow J, if s 424A is engaged, the information and invitation to comment are to be given in writing and are to be given (if the applicant is not in immigration detention) by one of the methods specified in s 441A or (where the applicant is in immigration detention) by one of the methods prescribed for the purposes of giving documents to such a person. In either case it will be for the Tribunal to choose which of the available methods of giving the information and invitation to comment will be used. The Minister's contentions to the contrary (which sought to give controlling force to the parenthetical expression in s 424A(1) "in the way that the Tribunal considers appropriate in the circumstances") should be rejected. The information which the Tribunal obtained from the evidence given by the eldest daughter, and which it gave as a reason to affirm the decision under review, was specifically about the first appellant and members of her family. It therefore did not fall within the exception provided by s 424A(3)(a). On its face, s 424A(1) required the Tribunal to give particulars of the information to the appellants and to ensure, as far as practicable, that they understood why it was relevant to the review. When read in the context of the Act as a whole, and particularly the provisions of Div 4 of Pt 7, however, is s 424A to be read as being engaged only at a particular point in the process of the Tribunal's review? That is, do the provisions of Div 4 of Pt 7 establish a sequence of procedural steps that are to be taken by the Tribunal when reviewing a protection visa decision? Is the point at which the Tribunal becomes aware of, or identifies, some information that it considers would be the reason, or a part of the reason, for affirming the decision that is under review, significant? In particular, does it matter whether the Tribunal becomes aware of that information, or first identifies it as having the requisite character, before or after the Tribunal decides whether s 425 requires it to invite the applicant to appear before it "to give evidence and present arguments relating to the issues arising in relation to the decision under review"? I would answer each of those questions, "No". There are two related reasons for doing so. First, although the language of the Act permits the contrary construction, I consider the better view to be that the provisions of Div 4 of Pt 7 do not establish a sequence of procedural steps from which the Tribunal may not depart. Secondly, given the nature of the task to be undertaken by the Tribunal, the Act should not be construed as binding the Tribunal to follow a particular and invariable sequence of steps, when conducting a review, unless the language of the Act dictates that result. It does not. Hayne Textual considerations No provision of the Act states expressly that the Tribunal must follow a particular sequence of steps when conducting a review. Read as a whole, however, does Div 4 of Pt 7 bear that meaning? There is, of course, no doubt that Div 4 of Pt 7 is set out in a logical order. It begins by providing for documents that may be given to the Tribunal, in addition to those which the Secretary to the Department must provide131; it deals with the Tribunal seeking additional information132; it provides for inviting the applicant to appear133; and for the applicant to request the calling of witnesses134. Sections at the end of the division then deal with the powers of the Tribunal135 and its conducting its review in private136. A review may, perhaps many reviews would, be conducted in steps that generally follow the order in which Div 4 of Pt 7 deals with these particular subjects. It by no means follows from that fact alone, however, that the Act prescribes the order in which the Tribunal is to go about its task of reviewing the decision that has been made and I did not understand the contrary to be suggested. Rather, emphasis was placed upon the provisions of s 425(2) and (3), which qualify the otherwise imperative requirement of s 425(1) that the Tribunal invite the applicant to appear before it "to give evidence and present arguments relating to the issues arising in relation to the decision under review". One of those qualifications (that provided by s 425(2)(c)) is engaged if the applicant either is invited to give additional information, but does not, or is invited, under s 424A, to comment on information, but does not do so within the time fixed for giving the comments. In any such case, "the applicant is not entitled to appear before the Tribunal". If an applicant's appearance before the Tribunal were to be seen as the focus or the culmination of the process of review, the provisions of s 425(2)(c) would suggest that any invitation to the applicant to give information, and any invitation to the applicant to comment on information, would ordinarily come before the "hearing" contemplated by s 425. Even so, it would be another 133 ss 425 and 425A. Hayne and much larger step to construe these provisions as neither permitting nor requiring any departure from this order of events. It is necessary to notice that s 425(2)(c) is engaged not only if s 424C(2) applies to the applicant (as it will if s 424A has been invoked) but also if s 424C(1) applies to the applicant. If a person is invited under s 424 to give additional information to the Tribunal, but does not do so before the time for giving it has passed, s 424C(1) permits the Tribunal to make a decision, without taking further action to obtain the additional information. Section 424C may therefore be engaged where, pursuant to s 424, information is sought from the applicant or from another. Section 425(2)(c) deals with the case where information is sought from the applicant, but not provided in time. In such a case, the applicant is not entitled to appear before the Tribunal. If the provisions of Div 4 of Pt 7 are seen as requiring the Tribunal to follow the sequence in which the several provisions appear in the division, there would be no basis for distinguishing between the Tribunal obtaining information from the applicant under s 424 and its obtaining information either from some other person or in some other way. On the sequential understanding of the provisions, the step of seeking additional information must precede the invitation to appear, or at least must precede the appearance. That is, if Div 4 is understood as providing for a sequence of procedural steps, the Tribunal's power to get any information that it considers relevant would no longer be available once it had issued an invitation to the applicant to appear before it, or had had the applicant appear to give evidence and present arguments. No matter what information touching the decision under review emerged at or after the taking of steps under s 425, the Tribunal could not pursue it. The time for obtaining additional information would have passed. So to read Div 4 of Pt 7 would markedly confine the way in which the Tribunal exercises its function of reviewing decisions. There are then some further textual indications that Div 4 of Pt 7 does not prescribe the order in which the Tribunal must go about its task. The Tribunal is obliged to review a decision that has already been made. It is not the primary decision-maker. The Act provides137 that the Tribunal may exercise all the powers and discretions that are conferred by the Act on the person who made the decision. The Act obliges138 the Tribunal to pursue the objective of providing a mechanism of review that is "fair, just, economical, informal and quick". The Act obliges139 the Secretary to the Department to give the Tribunal a statement Hayne about the decision under review that sets out the findings of fact made by the decision-maker, refers to the evidence on which the findings are based, and gives the reasons for the decision. In addition, the Secretary must give the Tribunal "each other document, or part of a document, that is in the Secretary's possession or control and is considered by the Secretary to be relevant to the review of the decision". The Tribunal, therefore, comes to the review armed with the decision, with a statement of the reasons and evidence upon which it was based and whatever departmental documentary material is thought relevant to the review. Those documents form the foundation for the review in as much as it is the documents that may be expected to form the first and principal point of inquiry about the correctness of the decision under review. Review – a predominantly documentary process Part 7 of the Act, and Div 4 in particular, contains various provisions whose evident purpose is to afford procedural fairness to applicants. No doubt s 425 is a prominent example of such provisions. But it is not right to see the applicant's appearance before the Tribunal pursuant to s 425, to give evidence and present arguments, as the focus or culmination of the review process. It is no more than one step in what otherwise is a predominantly documentary process. That the process is predominantly documentary is demonstrated by the several provisions (mentioned above) for assembling relevant documents and by some other provisions of Div 4 of Pt 7 to which I should now refer. Sections 424A and 424B provide for applicants being invited to give additional information or comments "at an interview". There is no reason to conclude that such an interview must be conducted by the Tribunal member assigned to conduct the review. Whether or not that is so, the "interview" contemplated by s 424B is treated by the Act as being separate and distinct from the "appearance" contemplated by s 425. No evidence is taken at an interview but a written record of the substance of the comments made, or additional information provided, at the interview would no doubt be prepared. When s 425 is engaged, the applicant appears before the Tribunal "to give evidence and present arguments". When notice of invitation to appear is given under s 425A, the applicant is to be notified140 that the applicant may give written notice that he or she wants the Tribunal to obtain oral evidence from a person or persons named in the notice141. The Tribunal must have regard to the applicant's wishes "but is not required to obtain evidence (orally or otherwise) from a person 140 s 426(1)(b). Hayne named in the applicant's notice" (emphasis added)142. The reference to obtaining evidence otherwise than orally contemplates documentary evidence. If evidence on oath or affirmation is taken for the purpose of a review, it need not be taken by the Tribunal member who is conducting the review143. Again, it would follow that a written record of the evidence would be considered by the Tribunal member conducting the review. The documentary record provided to the Tribunal and the record of the steps taken by the Tribunal in the course of the review therefore play a prominent part in its processes. Their prominence suggests that the applicant's appearance is not the culmination of the review. There is a further set of considerations which points against adopting a sequential understanding of the provisions. If the Tribunal decides to take evidence from a person named by the applicant, the Act is silent about when that evidence is to be taken. In at least some cases it would be convenient to take the evidence before the applicant appears before the Tribunal; in others, that may be neither necessary nor practicable. In deciding whether evidence or information can be obtained by the Tribunal after the applicant is invited to or does appear, much may be thought to turn on whether, at the time of the appearance, the applicant is in a position to "present arguments relating to the issues arising in relation to the decision under review"144. In particular, it might be suggested that, if the applicant could not present arguments relating to the issues arising in relation to the review until all evidence and information had been obtained, the appearance must, in every case, occur after the Tribunal has gathered whatever information or evidence is to be used in the review. Review – an exercise of Executive power Consideration of this last point about the operation of s 425(1) (whether the applicant is in a position to present arguments relating to the issues arising in relation to the decision) emphasises two important features of Div 4 of Pt 7 of the Act. First, because these provisions regulate the exercise of Executive power, not judicial power, the immediate purpose of the provisions is to provide procedural fairness to applicants in determining, by inquisitorial methods, whether an earlier decision reached should be affirmed or set aside. The provisions are not made to regulate an adversarial contest that will culminate in a trial of issues joined between parties. Hayne Rather, and this is the second feature of the provisions which is underlined by s 425(1), the issues arising in relation to the decision under review are those which the applicant for review (the visa applicant) has raised by the original claim for protection, the issues which the applicant raises about the way in which the primary decision-maker dealt with those claims and, finally, any issues which either the applicant or the Tribunal raises about subsequently revealed information. Consistent with the inquisitorial nature of the process, the Tribunal is not confined to examining the correctness of the decision under review by reference to material available to the primary decision-maker. That is why the Tribunal may, and commonly will, have regard to matters which have occurred after the decision being reviewed, such as changes in conditions in the applicant's country of origin. Subsequently revealed information may take many forms. It may touch the applicant personally; it may deal more generally with persons in the applicant's position. No less importantly, it may emerge at any time. The Tribunal is empowered145, in conducting the review, to "get any information that it considers relevant". Inviting a person "to give additional information" is but one way of the Tribunal getting information. (So much follows from the terms of s 424(2)146.) Given that what I have called subsequently revealed information may emerge at any time, there is no reason to confine the exercise of the Tribunal's power to get any information that it considers relevant to a particular point in the conduct of the review. In particular, the reference in s 425 to the applicant presenting arguments relating to the issues arising in relation to the decision under review does not require that conclusion. First, apart from subsequently revealed information, the issues arising in relation to the decision under review are set at the outset of a review. They may perhaps be refined in the course of the review, but the central issues (apart from any raised by subsequently revealed information) are established at the outset. Secondly, if s 424A is read as being engaged regardless of whether an invitation to appear has been or has to be given to the applicant, the applicant will, under that section, be invited to comment on the relevant information if the information is, for example, specifically about the applicant or another person. (I leave aside whether procedural fairness requires that the applicant be invited to comment on matters of a kind to which s 424A does not apply because it is not specifically about the applicant or another person and is just about a class of persons of which 146 "Without limiting subsection (1), the Tribunal may invite a person to give additional information." (emphasis added) Hayne the applicant or other person is a member147.) In these circumstances, the requirement in s 425(1) that the applicant be invited to present arguments relating to the issues arising in relation to the decision under review does not mean that the applicant's appearance is the final point in an otherwise sequential progression of procedural steps. Review – conclusions Underpinning all of what I have said about the operation of Div 4 of Pt 7 are two fundamental propositions. First and foremost, it must be borne steadily in mind that the Tribunal does not exercise judicial power. It forms part of the Executive, exercising the power given by the Act to the Executive, to grant or refuse to grant "a non-citizen permission, to be known as a visa"148, in this case, to remain in Australia. The particular kind of visa sought by the appellants was a protection visa149. The Act makes elaborate provision for how applications for visas (including applications for protection visas) are to be dealt with. For example, Pt 2, Div 3, subdiv AA of the Act (ss 44-51) regulates applications for visas; subdiv AB (ss 52-64) provides a "[c]ode of procedure for dealing fairly, efficiently and quickly with visa applications"; subdiv AC (ss 65-69) deals with the grant and refusal of visas; and subdiv AG (ss 77-84) makes a number of "[o]ther provisions about visas". The process for review of protection visa decisions for which Pt 7 of the Act provides is no more than a further step in the exercise of Executive power. Secondly, given the nature of the power to be exercised by the Tribunal, there is no reason to read the Act as defining the order in which the Tribunal should set about undertaking its task of reviewing a decision. It may be necessary to read it in that way if the appearance were the point at which issues joined between contesting parties were to be resolved. But there is no joinder of issue between contesting parties. And it is not necessary to read the provisions as providing for an invariable order of events if, as I consider to be the better view of the provisions, the appearance before the Tribunal is no more than one of several different steps to be taken in the course of the review. Did the failure to comply with s 424A constitute jurisdictional error? 147 Re Minister for Immigration and Multicultural Affairs; Ex parte Miah (2001) 206 CLR 57; Muin v Refugee Review Tribunal; Lie v Refugee Review Tribunal (2002) 76 ALJR 966; 190 ALR 601. Hayne Jurisdictional error? If a valid application is made under s 412 of the Act for review of a decision of a kind identified in s 411, the Tribunal "must review the decision"150. A decision to refuse to grant a protection visa is one kind of decision mentioned in s 411. Division 3 of Pt 7 of the Act (ss 420-422A) makes provision for the exercise of the Tribunal's powers and, as has already been seen, Div 4 regulates the conduct of the review. Division 5 (ss 430-431) makes a number of provisions about the Tribunal's decisions – how they are to be recorded (s 430), handed down (ss 430A-430D) and published (s 431). The focus of the inquiry about jurisdictional error must be upon the combined operation of s 414(1) (which obliges the Tribunal to review the decision) and s 415 (which gives the Tribunal the same powers and discretions as are conferred by the Act on the primary decision-maker). It is the validity of the act done in purported performance of the obligation to review and decide which is in issue. The question is, having regard to "the language of the relevant [provisions] and the scope and object of the whole statute"151, is it "a purpose of the legislation that an act done in breach of [s 424A] should be invalid"152? That is, is the Tribunal's decision to affirm the refusal of protection visas to the appellants invalid for want of compliance with s 424A? The language of s 424A is, of course, imperative: "the Tribunal must" take the several steps it prescribes. That imperative language stands in sharp contrast with the permissive terms of, for example, s 424 which says that "the Tribunal may" take various steps. The evident purpose of the provisions of s 424A (and several other provisions in Div 4 of Pt 7) is to give applicants for review procedural fairness. It is clear that want of procedural fairness may constitute jurisdictional error153. As Gaudron and Gummow JJ said in Re Refugee Review Tribunal; Ex parte Aala154: 151 Tasker v Fullwood [1978] 1 NSWLR 20 at 24 cited in Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 391 [93]. 152 Project Blue Sky (1998) 194 CLR 355 at 390 [93]. 153 Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82; Re Minister for Immigration and Multicultural Affairs; Ex parte Miah (2001) 206 CLR 57. 154 (2000) 204 CLR 82 at 109 [59]. Hayne "However, the conditioning of a statutory power so as to require the provision of procedural fairness has, as its basis, a rationale which differs from that which generally underpins the doctrine of excess of power or jurisdiction. The concern is with observance of fair decision-making procedures rather than with the character of the decision which emerges from the observance of those procedures. Unless the limitation ordinarily implied on the statutory power is to be rewritten as denying jurisdictional error for 'trivial' breaches of the requirements of procedural fairness, the bearing of the breach upon the ultimate decision should not itself determine whether prohibition under s 75(v) should go. The issue always is whether or not there has been a breach of the obligation to accord procedural fairness and, if so, there will have been jurisdictional error for the purposes of s 75(v)." In the present matter, although the provision now in question was, as I have pointed out earlier, one of several intended to achieve procedural fairness, the the "observance of fair decision-making immediate focus procedures". It is upon "the character of the decision". Has the Tribunal validly decided the review? Or is the decision reached in the review, in breach of s 424A, invalid? is not upon Where the Act prescribes steps that the Tribunal must take in conducting its review and those steps are directed to informing the applicant for review (among other things) of the relevance to the review of the information that is conveyed, both the language of the Act and its scope and objects point inexorably to the conclusion that want of compliance with s 424A renders the decision invalid. Whether those steps would be judged to be necessary or even desirable in the circumstances of a particular case, to give procedural fairness to that applicant, is not to the point. The Act prescribes what is to be done in every case. In light of that conclusion, it is not necessary to consider the separate question whether the procedures which were followed by the Tribunal in this particular case were procedurally fair. Relief? The Minister submitted that no relief should be granted to the appellants. It was contended, in effect, that the course of events at the Tribunal was such that the first appellant (at least by her migration agent) was aware of what the eldest daughter said and had sufficient opportunity to meet it. Lying behind that submission might be thought to have lurked the suggestion that because the first appellant is illiterate in any language and the second appellant is a young child, giving of notice in writing to them in accordance with s 424A would have served no practical purpose. Whether or not that was a proposition that did lie behind Hayne the submission that relief should be refused on discretionary grounds, the submission should be rejected. For the reasons given earlier, the decision reached by the Tribunal is invalid. There is no basis, in this case, on which the undoubted discretion to refuse the relief sought could be exercised against its grant. There has been no suggestion of delay, waiver, acquiescence or other conduct of the appellants said to stand in their way. As Gaudron J said in Enfield City Corporation v Development Assessment Commission155: "Those exercising executive and administrative powers are as much subject to the law as those who are or may be affected by the exercise of those powers. It follows that, within the limits of their jurisdiction and consistent with their obligation to act judicially, the courts should provide whatever remedies are available and appropriate to ensure that those possessed of executive and administrative powers exercise them only in accordance with the laws which govern their exercise. The rule of law requires no less." (footnote omitted) Even if the considerations advanced by the Minister were relevant to considering whether relief should go for jurisdictional error constituted by a want of procedural fairness (a question I need not examine) they are not considerations that bear upon whether certiorari should go to quash what is found to be an invalid decision. Conclusion and orders For these reasons the appeal should be allowed. I would make the following orders: Appeal allowed with costs. Set aside the orders of the Full Court of the Federal Court made on 11 December 2002 and, in their place, order: appeal allowed with costs; set aside the orders of Mansfield J made on 10 May 2002 and, in their place, order that: 155 (2000) 199 CLR 135 at 157 [56]. Hayne there be an order in the nature of certiorari to quash the decision of the Refugee Review Tribunal ("the Tribunal") made on 18 October 2001; there be an order in the nature of mandamus requiring the Tribunal to review according to law the decision made by a delegate of the Minister on 19 June 2001 to refuse the protection visas sought by the applicants; (iii) the respondent pay the applicants' costs.

HIGH COURT OF AUSTRALIA Matter No S43/2008 APPELLANT AND JESSIE McNEILLY & ANOR RESPONDENTS Matter No S392/2007 JESSIE McNEILLY & ANOR APPLICANTS AND RESPONDENT McNeilly v Imbree [2008] HCA 40 28 August 2008 S43/2008 & S392/2007 ORDER Matter No S43/2008 Appeal allowed with costs. Set aside the orders of the Court of Appeal of the Supreme Court of New South Wales made on 2 July 2007 and 23 July 2007. The parties have 7 days from the date of this order to file and serve agreed minutes of the consequential orders to be made. In default of agreement upon the consequential orders to be made, the parties have 14 days from the date of this order to file and serve written submissions as to the form of consequential orders to be made. Matter No S392/2007 Application refused with costs. On appeal from the Supreme Court of New South Wales Representation A S Morrison SC with M R Hall and A J Stone for the appellant in S43/2008 and the respondent in S392/2007 (instructed by Abrahms Turner Whelan Family Lawyers) K P Rewell SC with M A Cleary for the respondents in S43/2008 and the applicants in S392/2007 (instructed by TL Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Negligence – Standard of care – Definition of standard – Where unskilled and inexperienced driver with passenger who, aware of driver's lack of skill and experience, has undertaken to supervise driving – Whether "special relationship" between driver and supervising passenger such that standard of care required of driver in respect of supervising passenger is merely care reasonably to be expected of unqualified and inexperienced driver in the circumstances, rather than care to be expected of a reasonable driver – Whether Cook v Cook (1986) 162 CLR 376 should still be followed. Negligence – Standard of care – Relevance of compulsory third party insurance to definition of standard of care in negligence in motor vehicle context. Insurance – Motor vehicles – Compulsory third party insurance – Compulsory provisions applicable throughout Australia – Relevance of such insurance to definition of standard of care in negligence in motor vehicle context – Whether such insurance immaterial to standard of care to be expected of learner driver – Whether common law of negligence affected in relevant way by existence of compulsory third party insurance. Words and phrases – "compulsory third party insurance", "duty of care", "proximity", "special relationship", "standard of care". GLEESON CJ. I have had the benefit of reading in draft form the reasons for judgment of Gummow, Hayne and Kiefel JJ. I agree with the orders proposed by their Honours, and with their reasons for those orders. The relationship that was said in Cook v Cook1 to be special, and to require a departure from the normal objective standard of care, was that "between a driver who is known to be quite unskilled and inexperienced and a passenger who has voluntarily undertaken to supervise his or her driving efforts."2 The injured passengers in Cook v Cook, Nettleship v Weston3, and the present case, were not professional or qualified teachers. The occasion for the supervision was purely social. In practice, many, perhaps most, supervisors of learner drivers are relatives or friends acting in a voluntary capacity. In this case, as in Cook v Cook, the driver needed the supervising passenger's permission to drive the car. That permission was given subject to a stipulation that the driver should not exceed a certain speed. That is not uncommon. The ordinary traffic laws impose speed limits on inexperienced drivers. It is a basic precaution often adopted in informal situations of instruction or supervision. There may be any number of ways in which personal attributes, permanent or temporary, may affect a driver's capacity to exercise care for the safety of others. Knowledge of such attributes may be relevant to contributory negligence, or to a defence of voluntary assumption of risk, but the fact of such knowledge is not normally treated as a defining aspect of the circumstances, so as to modify the care that is required as a legal obligation. It was not so treated by the plurality in Cook v Cook. What, then, of the additional factor of undertaking supervision of an inexperienced driver? In the view of the plurality in Cook v Cook, even though all the passengers in a car may be aware of a driver's inexperience, it is generally only the supervising passenger to whom the lower standard of care is owed4. I say "generally" because the reasons in Cook v Cook5 say that in rare cases the relationship between driver and passenger may fall into the special category postulated. There is nothing rare about a passenger knowing that a driver is inexperienced. There are, however, degrees of inexperience. In the ordinary case, the central feature of the relationship between the driver of a car and all the (1986) 162 CLR 376; [1986] HCA 73. (1986) 162 CLR 376 at 388. (1986) 162 CLR 376 at 382-383. (1986) 162 CLR 376 at 386. passengers, including a supervisor, is the vulnerability of the passengers. (An extraordinary case may be, for example, one in which the driver is driving under the legal or practical compulsion of the passenger.) The driver of a car has the capacity to cause death or serious injury because of the nature of the activity undertaken. If a passenger fails to take reasonable care for his or her own safety, the principles of contributory negligence apply. According to the argument for the respondents, logic demands recognition that a person who is being supervised by another owes a lower standard of care to the supervisor than to anybody else. The appellant's case is that logic demands no more than a recognition that, depending upon the circumstances, the supervisor may be more likely than others to be affected by contributory negligence. The second seems to me the better view. It will be necessary to return to the separate reasons of Brennan J in Cook v Cook. Those reasons attached decisive significance, not to the passenger's having undertaken to supervise the driver, but to the passenger's knowledge that the driver was inexperienced6. It appears that, in the present case, Brennan J would not have distinguished, in terms of the standard of care, between the various passengers, all of whom knew of the driver's lack of experience. Underlying the plurality reasons was a question of the relevance of skill to care. Taking care for the safety of another may involve the exercise of skill, caution, alertness, physical mobility and other qualities. These may interact. They may be missing, or temporarily or permanently diminished, to a greater or lesser degree. In the first edition of Sir Frederick Pollock's The Law of Torts7, the learned author said: "Due care and caution ... is the diligence of a reasonable man, and includes reasonable competence in cases where special competence is needful to ensure safety." If an activity, in order to be performed safely, requires a certain degree of skill, undertaking the activity without the requisite skill may itself be a form of negligence8. While the ability to drive a motor car is nowadays a common skill, it requires a degree of technical competence. This is recognised by legislation, in all parts of Australia, which regulates learning to drive. Under such legislation, an unrestricted licence to drive is gained only over time, and by degrees, and the restrictions to which a holder of a restricted licence may be subject may include such matters as speed and alcohol consumption. (1986) 162 CLR 376 at 393-394. 7 Pollock, The Law of Torts, (1887) at 359. 8 Salmond, The Law of Torts, (1907) at 23-24. See also Heuston and Buckley, Salmond and Heuston on the Law of Torts, 21st ed (1996) at 223-224. It was not suggested in this case (or in Cook v Cook or in Nettleship v Weston) that the negligence of the driver consisted in undertaking the driving in the first place. There may be circumstances in which a person who takes control of a motor car is so lacking in competence that the act of taking control is itself negligent. Where that would leave an instructor, or supervisor, or other passenger, who directed or permitted the act is not the present problem. According to the circumstances, it could mean that there is no duty of care, or voluntary assumption of risk, or a high degree of contributory negligence, or an absence of causation. In a case, like the present, where it is not claimed that there was such a degree of incompetence, resulting from inexperience, as to make taking control of the vehicle itself an act of negligence, then the hypothesis is that the driver, although inexperienced and potentially reliant on advice and information, was capable of driving the vehicle safely. In fact, in this case the first respondent drove safely for a substantial distance. In some respects, it may have been reasonable to expect him to be more cautious than an experienced driver. It was foreseeable that circumstances might arise in which his lack of experience would increase the risk of an accident. Yet he chose to drive. He thereby took on the capacity to cause death or serious injury to his passengers and others, and the legal responsibility that went with it. Inexperience is one of many attributes that may affect a driver's ability to avoid danger. As was pointed out by counsel for the appellant, a visitor from overseas, who had never previously driven on the left side of the road, or across a desert, may be described as inexperienced if placed in the same situation as the driver in this case. Many other factors may cause impairment of driving skills, in varying degrees. The question is whether, as a matter of legal principle, there is sufficient reason to single out inexperience, or to treat the relationship between an inexperienced driver and a supervisor as modifying the ordinary, objectively expressed, standard of care. To describe a case as special, or exceptional, implies existence of a principle by which it can be recognised, and distinguished from the ordinary. The plurality reasons in Cook v Cook accepted that, as a general rule, the standard of care owed by a driver to someone who might foreseeably be injured by lack of care is objective and impersonal, and is not modified by the personal attributes of the driver, which might include age, skill, alertness, physical or mental health, sobriety or even aspects of temperament, some of which, in the case of the one driver, may alter, perhaps over a short time. This is so because the care that is reasonably required of the driver of a car is a product of the harm that can result from failure to exercise care, and because the alternative would be an infinitely variable standard, responding to the particular combination of attributes possessed by a driver at any given time9. It was concluded in Cook v Cook10 that, because the absence of skill, or experience, was the reason for the instruction or supervision that was undertaken, it was irrational to impose a standard of care owed by the driver to the instructor or supervisor that was not modified to take account of the lack of skill or experience. That, with respect, is not at all obvious. The factors described as special may be significant, in a given case, for issues such as the existence of a duty of care, contributory negligence, voluntary assumption of risk, or causation. Given, however, that it is accepted that the driver owes a duty to the supervisor to take reasonable care for the supervisor's safety; given the wide variability in degrees of inexperience; and given the interaction of experience, or lack of it, with other personal attributes that bear upon safe driving, it is not irrational to impose an objective standard of care rather than to attempt to adjust the standard of care to the level of experience of an individual driver. An alternative view, preferred by Brennan J in Cook v Cook, is that knowledge that the driver was inexperienced (in this case, a knowledge shared by all the passengers) is the key factor, with the result that the standard of care is "the standard of an inexperienced driver of ordinary prudence."11 This approach, however, also raises the difficulty mentioned above. In Nettleship v Weston12, Megaw LJ pointed to the problem of complex and elusive factors that might affect a particular person's ability to take care. I see no answer to the problem. It may be demonstrated by reference to The Insurance Commissioner v Joyce13. Dixon J, in successive sentences14, referred to a "drunken driver" and a "driver affected by drink". It is now generally accepted that even a modest amount of alcohol may cause impairment of a driver's capacity, and the extent of the impairment may vary with other attributes of the driver, perhaps including experience. The difficulty of applying a standard of an inexperienced driver of ordinary prudence is shown by the decisions at trial and in the Court of Appeal in this case. Four judges, bound by authority to apply that standard, and to work 9 See Joslyn v Berryman (2003) 214 CLR 552 at 564 [30] per McHugh J; [2003] HCA 34. 10 (1986) 162 CLR 376 at 384. 11 (1986) 162 CLR 376 at 394. 12 [1971] 2 QB 691 at 708-709. 13 (1948) 77 CLR 39; [1948] HCA 17. 14 (1948) 77 CLR 39 at 57. out the extent to which the accident was the result of inexperience, as compared with some other deficiency, produced four different results. I agree with Gummow, Hayne and Kiefel JJ that Cook v Cook should not be followed, for the reasons and with the consequences they assign. It was not argued for the appellant that a reason for not following Cook v Cook is that the respondents were insured under a statutory scheme of compulsory insurance. Nor was there any argument about whether it would have made a difference if the respondents had been voluntarily insured, or uninsured, or if their insurer had become insolvent15. The insurance that applied was, of course, insurance against legal liability for negligence. The statutory insurance regime operated upon – it did not create – the legal liability. Schemes of compulsory insurance for third party liability in motor accidents are not new. They existed at the time of Cook v Cook, and for a long time before then. It is useful to consider the detail of Lord Denning MR's reasoning in Nettleship v Weston16 in this respect. His Lordship examined the responsibility of a learner driver towards an instructor after first having discussed three other aspects of the driver's responsibility: his or her responsibility in criminal law; his or her responsibility to other persons on or near the highway; and his or her responsibility towards passengers in the car. His Lordship was addressing a matter of legal coherence17. As to the learner driver's responsibility in criminal law, insurance had nothing to do with it. In that respect, as his Lordship noted, it is no defence for a learner to be doing his or her incompetent best18. As to the learner driver's responsibility to persons on or near the highway, his Lordship again noted that it is no excuse that a defendant was only a learner. There was no attenuation of the duty of care. It was in that connection that his Lordship referred to the "high standard" imposed largely as "the result of the policy of the Road Traffic Acts."19 In that part of his reasons his Lordship refers 15 The recent financial failure of a major Australian insurance company serves as a reminder that insurance is not necessarily synonymous with cover. 16 [1971] 2 QB 691 at 697-703. 17 cf Sullivan v Moody (2001) 207 CLR 562; [2001] HCA 59. 18 [1971] 2 QB 691 at 698-699. 19 [1971] 2 QB 691 at 699. to five decided cases. The first20 was a case about negligent management of a tea room. The second21 was a case of damage caused by a skidding car. There is no reference to insurance, or to the policy of any legislation. The third22 was a case of a pedestrian whose arm was bruised, coat torn, and shopping bag damaged by the protruding handle of a motor van. There was "abundant evidence"23 of negligence of the driver. The plaintiff was awarded £10 damages. Again there was no reference to insurance, or the policy of any legislation. The fourth24 was an Admiralty case about a collision between ships. There was no reference to insurance. The fifth25 was a case of personal injuries resulting, not from negligent driving, but from brake failure of an inadequately maintained lorry. There was no reference to insurance. None of the motor vehicle cases referred to indicated, and none of them acknowledged, any "high standard", or addressed the problem of the inexperienced learner. Quite apart from those cases, however, his Lordship undoubtedly was correct to say that a learner's responsibility towards persons on or near the highway is not attenuated. The learner cannot say: "I was doing my best and could not help it." Having regard to the capacity of a motor vehicle to cause harm, and the vulnerability of others on or near the highway, that can be explained by considerations other than compulsory insurance. Indeed, it is probably the other way around: the capacity of a driver to injure others explains compulsory insurance. What is of present significance is that his Lordship referred to the policy of the Road Traffic Acts as a reason for requiring a high standard of care of drivers, not as a reason for declining to differentiate between learner drivers and others. His Lordship then went on to consider the responsibility of a learner driver towards passengers in the car, and again observed that the standard of care was objective26. 20 Glasgow Corporation v Muir [1943] AC 448. 21 Richley (Henderson) v Faull. Richley Third Party [1965] 1 WLR 1454; [1965] 3 All ER 109. 22 Watson v Thomas S Whitney & Co Ltd [1966] 1 WLR 57; [1966] 1 All ER 122. 23 Watson v Thomas S Whitney & Co Ltd [1966] 1 WLR 57 at 60; [1966] 1 All ER 24 The Merchant Prince [1892] P 179. 25 Henderson v Henry E Jenkins & Sons [1970] AC 282. 26 [1971] 2 QB 691 at 700-701. Having done all that, his Lordship asked whether the care owed to a passenger who was also an instructor was less than the care owed according to the criminal law, or the care owed to people on or near the highway, or the care owed to other passengers. He answered that question in the negative, without further reference to insurance27. The respondents in the present case appeared to accept that the standard of care owed by an inexperienced driver to other people on or near the highway, and to passengers in the car, except the supervising passenger, is objective. The question of principle to be decided is whether the position is different in relation to the supervising passenger. The problem of the objectivity of the standard of care of an inexperienced person, or the comparative standards of care owed by an inexperienced person, or a person suffering from some other form of disability or impairment, and an "ordinary" person, is not one peculiar to the drivers of motor vehicles that are subject to a scheme of compulsory third party insurance. A similar problem would arise in many other contexts, where there is no compulsory insurance. If the answer to the problem in the present case depends upon the existence of compulsory insurance, then presumably a different answer would, or at least may, be given in a case where there is no compulsory insurance. The result is both "morally incoherent", as Professor Stapleton described it28, and productive of legal confusion. The law governing the legal rights and obligations of motorists in all parts of Australia, although it varies significantly between different jurisdictions, is a combination of common law and statute. In some jurisdictions, common law principles as to damages have been replaced by detailed statutory regulation. Without doubt, insurance is a major factor in the practical operation of the law of negligence as it applies to motor vehicle accidents, and the various schemes governing insurance against third party liability, some of which include government regulation of the market, reflect legislative policy of great social importance. It may be that Lord Denning understated the position when he said that the standard of care expected of drivers reflected legislative policy. It may be fair to say that, without the availability of reasonably affordable insurance, the application of the principles of the common law of negligence to the risks involved in driving a motor vehicle would mean that few people would drive. The common law makes a defendant liable for all the harm of which his or her negligence is a cause, however slight the moral culpability involved in the 27 [1971] 2 QB 691 at 701-702. 28 Stapleton, "Tort, Insurance and Ideology", (1995) 58 Modern Law Review 820 at negligence, and however extensive the harm. Momentary inattention can be a cause of harm for which few motorists could afford to pay compensation. In the present case, the damages of the appellant were assessed at $9,563,731. The Australian States and Territories have not followed the New Zealand example of dealing with the problem as an issue of social security. The common law continues to apply, but with a heavy overlay, varying in its detail, of statutory prescription and modification. Compulsory third party insurance is one aspect of that overlay. The question in the present case is one of common law principle. Is the standard of care owed by an inexperienced driver to a supervising passenger the same objective standard as that owed to third parties generally? That is a matter that could be regulated by statute29. There is no legislation relevant to these proceedings that touches the point. If the existence of a scheme of compulsory third party insurance is a reason for giving an affirmative answer, and not merely a basis for an inclination to be pleased with such an answer, then there must be a principled explanation for that. If it were not for insurance, the common law would operate with intolerable harshness in its application to driving. That is a sound reason in public policy for legislative intervention. If it were not for third party insurance, it may be assumed that the first respondent would not have been permitted, and (at least if well informed) would not have dared, to drive at all on the occasion in question. Such insurance does not, however, provide a step in a process of reasoning towards an answer to the particular question that arises for decision in this appeal. I agree that the appeal should be allowed, and consequential orders made as proposed by Gummow, Hayne and Kiefel JJ. 29 See, for example, the Motor Accidents Compensation Amendment (Claims and Dispute Resolution) Act 2007 (NSW), which inserts s 141 in the Motor Accidents Compensation Act 1999 (NSW) with effect from 1 October 2008. GUMMOW, HAYNE AND KIEFEL JJ. The appellant (Paul Anthony Imbree) allowed the first respondent (Jesse McNeilly30) to drive a four-wheel drive station wagon31 on Larapinta Drive in the Northern Territory, a gravel road between Kings Canyon and Hermannsburg. The first respondent was then aged 16 years and five months. As the appellant knew, the first respondent had little driving experience, he was not licensed to drive, and he did not hold any learner's permit. He lost control of the vehicle and the vehicle overturned. The appellant, then a front-seat passenger, was seriously injured. What was the standard of care that the first respondent (the driver) owed the appellant (the passenger)? Was it, as this Court held in Cook v Cook32, "that which is reasonably to be expected of an unqualified and inexperienced driver in the circumstances in which the pupil is placed"? Or was it, as the appellant submitted, the same objective standard of care as a licensed driver? These reasons will show that the standard of care which the driver (the first respondent) owed the passenger (the appellant) was the same as any other person driving a motor vehicle – to take reasonable care to avoid injury to others. The standard thus invoked is the standard of the "reasonable driver". That standard is not to be further qualified, whether by reference to the holding of a licence to drive or by reference to the level of experience of the driver. Cook v Cook should no longer be followed. The facts Before the accident which gives rise to this litigation, the appellant had had a great interest in four-wheel drive trips in and around Australia. He had undertaken several off-road trips to far north Queensland and to the Northern Territory. On the trip which leads to this litigation, the appellant was two of his sons (Paul and Reece), an adult friend accompanied by 30 Except in the title to the appeal in this Court, the first respondent's first given name is recorded as "Jesse". That spelling is adopted in these reasons 31 The vehicle was owned by the appellant's employer, the second respondent to this appeal, but the appellant used the vehicle as if it were his own. The two respondents have been jointly represented at all stages of the litigation. No issue in this Court was said to require separate consideration of the position of the second respondent. 32 (1986) 162 CLR 376 at 384 per Mason, Wilson, Deane and Dawson JJ; [1986] HCA 73. (Mr Ben Watson), and the first respondent (a friend of Paul Imbree junior). Paul Imbree junior was then aged 16 years and had just obtained a New South Wales learner's permit to drive a vehicle. The appellant knew that the first respondent had previously driven a four-wheel drive vehicle owned by his grandparents. The appellant knew however that the first respondent did not have a learner's permit. When the party travelled through Dubbo and Nyngan they tried to find an office of the Roads and Traffic Authority at which the first respondent could obtain a permit, but the offices were closed. In the later part of their journey from New South Wales to the Northern Territory, the appellant allowed first his son Paul, and then the first respondent, to drive for about 30 to 40 minutes each. He told both that they should not exceed 80 kmh. Each drove uneventfully. The trip proceeded into the Simpson Desert and again the appellant allowed each of the two boys to drive on two occasions. This driving was in more challenging conditions and again it passed without concern. After visiting Ayers Rock and Kings Canyon, the party headed towards Hermannsburg and Alice Springs on Larapinta Drive. Initially the road was hilly and corrugated and the appellant and Mr Watson drove. When the terrain changed, and the road was what the appellant would later describe as "a very wide two lane dirt track with no significant corrugations compared to what [he had] struck earlier", he allowed first his son Paul, and then the first respondent, to drive. When the first respondent drove, the appellant sat beside him in the front passenger seat. For a time the driving proceeded without any event out of the ordinary. Both the appellant and the first respondent then saw a piece of tyre debris on the road. Instead of straddling and driving over the debris, the first respondent steered the vehicle to the right. The appellant yelled at the first respondent, telling him to brake. He did not. When the vehicle was on the far right-hand side of the road, the first respondent turned sharply to the left and accelerated. This caused the vehicle to roll over. The appellant suffered spinal injuries that have rendered him tetraplegic. The proceedings below The appellant brought proceedings in the Supreme Court of New South Wales against the first respondent as driver and the second respondent as owner of the vehicle. The primary judge, Studdert J, gave judgment for the appellant33. 33 Imbree v McNeilly [2006] NSWSC 680. His Honour rejected34 the respondents' contention that the appellant had voluntarily assumed the risk of injury, found35 that the first respondent had "behaved with carelessness over and above what could be attributed merely to inexperience", and further found36 that the appellant had been contributorily negligent. The appellant's damages, assessed at more than $9.5 million, were reduced by 30 per cent on account of his contributory negligence. The respondents in this Court appealed to the Court of Appeal; the appellant cross-appealed. Both the appeal and the cross-appeal were allowed in part. The Court of Appeal (Beazley, Tobias and Basten JJA) considered37 a number of issues that are not pressed in this Court. In particular, questions of illegality, voluntary assumption of risk, and quantum of damages, were considered by the Court of Appeal, but none of these questions is raised in this Court. All members of the Court of Appeal rightly treated this Court's decision in Cook v Cook as establishing that "[a]ctions which are fairly to be seen as the result of [a learner driver's] inexperience and lack of qualification rather than as having been caused by superimposed or independent carelessness did not, of themselves, constitute a breach of the duty of care"38 which the learner driver owed to a licensed driver who was supervising the learner. The Court of Appeal divided in opinion about whether, in this case, the driver of the vehicle (the present first respondent) had breached the duty of care he owed his front-seat passenger (the present appellant). The majority (Beazley JA and Basten JA) found39 that the driver had been careless, but that the carelessness lay in swerving off the road rather than, as the primary judge had found, steering around the tyre debris. Beazley JA further found40 the driver to have been careless in accelerating as he did. The third member of the Court (Tobias JA) concluded41 34 [2006] NSWSC 680 at [51]. 35 [2006] NSWSC 680 at [48]. 36 [2006] NSWSC 680 at [86]-[87]. 37 McNeilly v Imbree (2007) 47 MVR 536. 38 (1986) 162 CLR 376 at 388 per Mason, Wilson, Deane and Dawson JJ. 39 (2007) 47 MVR 536 at 538-539 [13] per Beazley JA, 555-556 [83] per Basten JA. 40 (2007) 47 MVR 536 at 538 [12]. 41 (2007) 47 MVR 536 at 542 [29]. that the driver's acceleration and over-steering did not breach the standard of care of a driver with the limited skills and experience of this driver. The Court of Appeal also divided in opinion about what apportionment of liability should be made on account of the contributory negligence of the present appellant as the instructor or supervisor of the first respondent as driver. Basten JA42 assessed the appellant's contribution at two-thirds; Beazley JA assessed43 his contribution at one-half. Tobias JA, who had concluded that the driver was not negligent, went on to consider contributory negligence and agreed44 with Basten JA that the appellant's contribution should be assessed as two-thirds. Proceedings in this Court By special leave, the appellant appeals to this Court. His central proposition was that the driver, the first respondent, should be held to have owed him the same objective standard of care as a licensed driver. He submitted that Cook v Cook should be overruled. Because, as he submitted, the Court of Appeal had applied the wrong standard of care, it followed that the apportionment of responsibility had miscarried. The appellant further submitted that the respondents had not shown that any contributory negligence of the appellant was a cause of the damage that he suffered. Finally, as an alternative argument, the appellant submitted that, in any event, the Court of Appeal should not have interfered with the primary judge's assessment of contributory negligence. The respondents sought special leave to cross-appeal. They submitted that although "the approach of this Court in Cook v Cook to the standard of care owed by a driver whose ability is compromised by a lack of skill and experience, or by some other factor, known to the plaintiff, is correct, [it] requires re-statement in contemporary terms". The consequence of that re-statement, so the respondents argued, would be that, consonant with the reasoning of Tobias JA in the Court of Appeal, the appellant's claim for damages should have been dismissed. That is, having regard to the appellant's knowledge of the first respondent's limited skills and experience, the latter's driving did not depart from the standard of care the appellant was entitled to expect the first respondent to exercise. 42 (2007) 47 MVR 536 at 561-562 [111]. 43 (2007) 47 MVR 536 at 539 [15]. 44 (2007) 47 MVR 536 at 546 [48]. Cook v Cook Cook v Cook was decided in 1986. It was one of a large number of decisions made by this Court during the 1980s about the law of negligence. Many of those cases focused upon duty of care. Thus this Court considered45 what duty of care a public authority owed in exercising or not exercising its powers46 and spoke of a "general dependence" upon public authorities to perform their functions with due care47. This Court also re-expressed48 the duty of care owed by an employer to an employee as a non-delegable duty: a duty to ensure that reasonable care and skill was exercised49. And this Court rejected50 a theory of concurrent general and special duties owed by an occupier of land to an entrant in favour of determining only whether, in all the relevant circumstances, the defendant owed a duty of care under the ordinary principles of negligence. These decisions about duty of care must be understood in their historical context. In 1977, in Anns v Merton London Borough Council51, the House of Lords had formulated a two-stage test for determining duty. In 1985, this Court 45 Sutherland Shire Council v Heyman (1985) 157 CLR 424; [1985] HCA 41. 46 See now Pyrenees Shire Council v Day (1998) 192 CLR 330; [1998] HCA 3; Romeo v Conservation Commission (NT) (1998) 192 CLR 431; [1998] HCA 5; Crimmins v Stevedoring Industry Finance Committee (1999) 200 CLR 1; [1999] HCA 59; Graham Barclay Oysters Pty Ltd v Ryan (2002) 211 CLR 540; [2002] HCA 54. 47 Sutherland Shire Council v Heyman (1985) 157 CLR 424 at 464 per Mason J. See now Pyrenees Shire Council v Day (1998) 192 CLR 330 at 343-345 [18]-[20] per Brennan CJ, 385-388 [157]-[165] per Gummow J, 408-412 [225]-[232] per Kirby J; Graham Barclay Oysters Pty Ltd v Ryan (2002) 211 CLR 540 at 658-660 48 Kondis v State Transport Authority (1984) 154 CLR 672; [1984] HCA 61. See also The Commonwealth v Introvigne (1982) 150 CLR 258; [1982] HCA 40. 49 See, now, as to non-delegable duties: Burnie Port Authority v General Jones Pty Ltd (1994) 179 CLR 520; [1994] HCA 13; Scott v Davis (2000) 204 CLR 333; [2000] HCA 52; New South Wales v Lepore (2003) 212 CLR 511; [2003] HCA 4. 50 Australian Safeway Stores Pty Ltd v Zaluzna (1987) 162 CLR 479; [1987] HCA 7. rejected that approach52 preferring, instead, to analyse questions of duty of care by reference to proximity. And for a time, both before and after the decision in Cook v Cook, proximity was seen as the unifying criterion of duties of care53. Many of the decisions about duty of care that have just been mentioned made extensive reference to proximity. By 199954, if not earlier, this Court had rejected proximity as a satisfactory tool for determining whether a defendant owed a duty of care. Further, the three-stage approach described in Caparo Industries Plc v Dickman55 and subsequently adopted by the House of Lords56 was rejected57 in this Court. The reasons of the plurality in Cook v Cook depended, in important respects, upon the application of notions of proximity. Proximity was seen as informing not just whether a duty of care was owed, but also the content of the duty of care that was owed. Thus, the plurality said58 that: "The more detailed definition of the objective standard of care for the purposes of a particular category of case must necessarily depend upon the identification of the relationship of proximity which is the touchstone and control of the relevant category." That is, as their Honours went on to say59: "[T]he more detailed definition of the content of that objective standard will depend upon the relevant relationship of proximity from which it 52 Sutherland Shire Council v Heyman (1985) 157 CLR 424. 53 Jaensch v Coffey (1984) 155 CLR 549 at 584 per Deane J; [1984] HCA 52. See Hill v Van Erp (1997) 188 CLR 159 at 176-177 per Dawson J, 210 per McHugh J, 237-239 per Gummow J; [1997] HCA 9. 54 Perre v Apand Pty Ltd (1999) 198 CLR 180; [1999] HCA 36. 55 [1990] 2 AC 605 at 617-618 per Lord Bridge of Harwich. 56 Marc Rich & Co v Bishop Rock Marine Co Ltd [1996] AC 211. 57 Sullivan v Moody (2001) 207 CLR 562; [2001] HCA 59. 58 (1986) 162 CLR 376 at 382. 59 (1986) 162 CLR 376 at 382. flows and into which the reasonable person of the law of negligence must be projected; it 'is because that relation may vary that the standard of duty or of care is not necessarily the same in every case'60." It was on this footing that the plurality in Cook v Cook concluded61 that: "While the personal skill or characteristics of the individual driver are not directly relevant to a determination of the content or standard of the duty of care owed to a passenger, special and exceptional facts may so transform the relationship between driver and passenger that it would be unreal to regard the relevant relationship as being simply the ordinary one of driver and passenger and unreasonable to measure the standard of skill and care required of the driver by reference to the skill and care that are reasonably to be expected of an experienced and competent driver of that kind of vehicle." Thus, because "it would be to state a half-truth to say that the relationship was, if the pupil was driving, that of driver and passenger ... the standard of care which arises from the relationship of pupil and instructor is that which is reasonably to be expected of an unqualified and inexperienced driver in the circumstances in which the pupil is placed"62. In his separate reasons in Cook v Cook, Brennan J rejected63 "a concept of proximity other than reasonable foreseeability of injury as a tool for analysis or as a practical criterion for determining the existence of a duty of care". It followed, in his Honour's opinion64 that such a concept was not to be used "as a tool for analysis or a practical criterion for determining the standard of care required for discharging a duty of care". Nonetheless, Brennan J held that the circumstances out of which the duty of care owed by the learner driver to the instructor arose included the plaintiff's knowledge, when she accepted carriage in the vehicle, that the driver was inexperienced. It followed, in his Honour's view65 60 The Insurance Commissioner v Joyce (1948) 77 CLR 39 at 56 per Dixon J; [1948] HCA 17. 61 (1986) 162 CLR 376 at 383. 62 (1986) 162 CLR 376 at 384. 63 (1986) 162 CLR 376 at 393. 64 (1986) 162 CLR 376 at 393. 65 (1986) 162 CLR 376 at 394. that "the standard of care required to discharge the driver's duty in those circumstances is the standard of an inexperienced driver of ordinary prudence". Those considerations were summarised As Mason J said in State Government Insurance Commission v Trigwell66, this Court "is neither a legislature nor a law reform agency". But this Court has long since held67 that it can, and if appropriate will, reconsider its earlier decisions. In The Commonwealth v Hospital Contribution Fund68, Gibbs CJ identified four matters which in that case justified departure from earlier decisions. Commissioner of Taxation69 as being that (a) the earlier decisions did not rest upon a principle carefully worked out in a significant succession of cases; (b) there were differences in the reasoning that led to the earlier decisions; (c) the earlier decisions had achieved no useful result but considerable inconvenience; and (d) that the earlier decisions had not been independently acted on in a manner which militated against reconsideration. The need to consider these matters is obvious. It is necessary to do that, however, with a clear recognition of more basic principles. In particular, it is necessary to recognise that, when a court of final appeal considers judge-made law, "[w]hile stare decisis is a sound policy because it promotes predictability of judicial decision and facilitates the giving of advice, it should not always trump the need for desirable change in the law"70 especially, we would add, if the change is necessary to maintain a better connection with more fundamental doctrines and principles. In so far as the reasoning of the plurality in Cook v Cook depended upon the application of notions of proximity, it is reasoning that does not accord with subsequent decisions of this Court denying the utility of that concept as a determinant of duty. Subsequent development of legal doctrine denies the continued existence of the foundation upon which the reasoning of the plurality 66 (1979) 142 CLR 617 at 633; [1979] HCA 40. 67 See, for example, The Tramways Case [No 1] (1914) 18 CLR 54 at 58 per Griffith CJ; [1914] HCA 15; Attorney-General (NSW) v Perpetual Trustee Co Ltd (1952) 85 CLR 237 at 243-244 per Dixon J; [1952] HCA 2. 68 (1982) 150 CLR 49 at 56-58; [1982] HCA 13. 69 (1989) 166 CLR 417 at 438-439 per Mason CJ, Wilson, Dawson, Toohey and Gaudron JJ; [1989] HCA 5. 70 Perre v Apand Pty Ltd (1999) 198 CLR 180 at 216 [92] per McHugh J. appears to have rested71. This observation, however, does not conclude the issues that now arise. There are several reasons why that is so. First, the immediate question in this case concerns the content of the duty of care, not whether any duty of care should be found to exist. Secondly, it is to be noted that Brennan J arrived at substantially the same conclusion as the plurality about the content of the duty of care owed by a learner driver to the instructing or supervising driver, but expressly disclaimed reliance upon proximity. Thirdly, the reasoning of the plurality in Cook v Cook, which gave primacy in determining the content of the duty of care to identifying the relationship between the parties out of which the duty arose, reflected what had been said by Dixon J, in his dissenting reasons in The Insurance Commissioner v Joyce72, more than 30 years before proximity was identified as a concept unifying at least some aspects of the law of negligence. It follows, therefore, that simply to point to the frequency of reference to proximity in the plurality reasons in Cook v Cook, and couple that with the subsequent discarding of proximity as a tool for determining whether a defendant owes a duty of care, provides no sufficient basis for rejecting the principle that it established. It is necessary to look beyond the reliance on proximity reasoning. The reasoning in Cook v Cook, of both the plurality and Brennan J, identified the factual consideration critical to the conclusion reached as being that the plaintiff knew that the driver was inexperienced. That is, what the plaintiff knew was held to affect the standard of care that the plaintiff could expect the learner driver to observe. Nonetheless, the standard of care was held to be an objective standard. That is, the relevant standard of care was identified not as what this plaintiff could reasonably have expected this defendant to have done or not done, but as what a particular class of defendants (within which this defendant fell) could reasonably be expected to do or not do. Thus, the plurality held that the standard of care in a particular case was not to be adjusted "by reference to the physical characteristics and expertise or the usual carefulness or otherwise of the particular driver"73 (emphasis added). Rather, it was held74 that: 71 cf Lamb v Cotogno (1987) 164 CLR 1 at 11; [1987] HCA 47; Thompson v Australian Capital Television Pty Ltd (1996) 186 CLR 574 at 613-615 per Gummow J; [1996] HCA 38. 72 (1948) 77 CLR 39. 73 (1986) 162 CLR 376 at 387. 74 (1986) 162 CLR 376 at 387. "It is only when special and exceptional circumstances clearly transform the relationship between a particular driver and a particular passenger into a special or different class or category of relationship that the case will be one in which the duty of care owed by the particular driver to the particular passenger will be either expanded or confined by reference to the objective standard of skill or care which is reasonably to be expected of a driver to a passenger in the category of a case where that special or different relationship exists." (emphasis added) The onus of establishing facts giving rise to such a special or different class or category was cast75 upon the party asserting it. There have been various statements in this Court to the effect that in many well-settled areas of the law of negligence the existence of a duty of care and its content present no difficulty and that one such example concerns the responsibilities of a motorist on the highway to avoid causing injury to the person to "special and exceptional circumstances" in the passage from Cook v Cook set out above invites the question why the relevant legal relationship should be regarded as any more specific than that of driver and passenger77. As Dias and Markesinis pointed out shortly after Cook v Cook was decided78, the trend of English authority, including Nettleship v Weston79, had been to eschew distinctions between categories of drivers of motor vehicles. The reference Further, the translation of the particular knowledge of a plaintiff into the identification of a separate category or class of relationship governed by a distinct and different duty of care encounters various difficulties. These are both doctrinal and practical. 75 (1986) 162 CLR 376 at 387. 76 Sutherland Shire Council v Heyman (1985) 157 CLR 424 at 441-442 per Gibbs CJ; Modbury Triangle Shopping Centre Pty Ltd v Anzil (2000) 205 CLR 254 at 289-290 [103] per Hayne J; [2000] HCA 61; Vairy v Wyong Shire Council (2005) 223 CLR 422 at 443 [63] per Gummow J; [2005] HCA 62. 77 See Kidner, "The variable standard of care, contributory negligence and volenti", (1991) 11 Legal Studies 1 at 12-13. 78 Tort Law, 2nd ed (1989) at 103-104. The fundamental reason why Cook v Cook should no longer be treated as expressing any distinct principle in the law of negligence is that basic considerations of principle require a contrary conclusion. No different standard of care is to be applied in deciding whether a passenger supervising a learner driver has suffered damage a cause of which was the failure of the learner driver to act with reasonable care. After some elaboration of the basic considerations of principle to which reference is made above, it will be convenient to consider the significance for that elaboration of what was said, well before Cook v Cook, in Joyce. A reasonable learner driver? The basic considerations of principle may be stated as follows. First, the inquiry is about the applicable standard of care. Secondly, the standard to be applied is objective. It does not vary with the particular aptitude or temperament of the individual. Thirdly, it is, and must be, accepted that a learner driver owes all other road users a duty of care that requires the learner to meet the same standard of care as any other driver on the road. The learner may have to display "L-plates" for all other road users to see, but that learner will be held to the same standard of care as any other driver in fulfilling the learner's duty to take reasonable care to avoid injuring other road users. Fourthly, it was not suggested in argument, and there is nothing in Cook v Cook that would suggest, that a learner driver owes a lesser standard of care to any passenger in the vehicle except the licensed driver who sits in the adjoining seat. In particular, it was not suggested that any knowledge of another passenger that the driver was inexperienced affects the standard of care that the driver must observe to avoid injury to that other passenger. Knowledge of inexperience can thus provide no sufficient foundation for applying different standards of care in deciding whether a learner driver is liable to one passenger rather than another, or in deciding whether that learner driver is liable to a person outside the car rather than one who was seated in the car, in the adjoining seat. The other passenger will ordinarily know that the driver is a learner driver; the road user outside the car can see the L-plates. Yet it is not disputed that the learner driver owes each of those persons a standard of care determined by reference to the reasonable driver. To reject knowledge of inexperience as a sufficient basis upon which to found a different standard of care is to reject the only basis, other than proximity, for the decision in Cook v Cook. Yet rejection of knowledge as a basis for applying a different standard of care is required not only by the observation that knowledge of inexperience is held not to affect the standard of care owed to other passengers or other road users who observe a display of L-plates, but also by the essential requirement that the standard of care be objective and impersonal. No matter whether the content of the standard of care is described as that of the "inexperienced driver of ordinary prudence"80 or the "unqualified and inexperienced driver (but with some knowledge of the controls of a motor vehicle) in the situation in which the [driver] was placed"81 there are evident practical difficulties in applying such a standard. The division in opinion in the Court of Appeal in this case illustrates the difficulties that arise82. Both statements of the standard would require the drawing of difficult distinctions between "inexperience" on the one hand and "prudence" on the other, or between a want of application of (as yet unlearned) skills and a want of reasonable care. And both forms of the statement of applicable standard leave unanswered the question whether the distinctions that are drawn are to be applied regardless of how long the person has been learning to drive and regardless of whether the driver has attained a standard (but not the age) at which a licence could be issued. That is, describing the relevant comparator as the reasonable "inexperienced" driver does not sufficiently identify the content of the standard that is intended to be conveyed by use of the word "inexperienced". In particular it leaves undefined what level of competence is to be assumed in such a driver. Further, to describe the relevant comparator as "unqualified" points only to the absence of approved demonstration of adequate driving competence. Demonstration of relevant ability is beside the point. What is at issue is the definition of a standard of reasonable care, not any external recognition of attaining an ability to drive in accordance with that standard. And for like reasons, to describe the relevant comparator as a "licensed driver" diverts attention from the central inquiry: what would a reasonable driver do? Being authorised by the applicable law to drive unsupervised on a public road is neither a necessary nor a sufficient characteristic of the reasonable driver. Holding or not holding the relevant licence is irrelevant to the description or application of the relevant standard of care. The reasonable driver is to be identified by what such a driver would do or not do when driving, not by what authority a driver would need to have in order to drive lawfully. 80 (1986) 162 CLR 376 at 394 per Brennan J. 81 (1986) 162 CLR 376 at 388 per Mason, Wilson, Deane and Dawson JJ. 82 cf Nettleship v Weston [1971] 2 QB 691. Instructor or supervisor? One other possible footing for a conclusion that different standards of care are to be applied to a learner driver according to whether the person who suffered damage was the supervising driver, or was another passenger or other road user, should be examined. Both in Cook v Cook, and in the present case, the relationship between the parties was described by identifying the plaintiff as the "instructor" or "supervisor" of the defendant as a learner driver. What is meant in this context by "instructor" or "supervisor"? Words like "instructor" or "supervisor" carry overtones of command or control. Those overtones may jar if they are heard in the context of a parent who has allowed a 16 year old child who holds a learner's permit to drive the family car. But whatever dissonance may stem from an unwillingness of the learner to respond to command or control, the parent, though licensed to drive the vehicle, may have no experience as a teacher, let alone experience in teaching another to drive a motor vehicle. This would suggest that the term "instructor" may not be apt. The expression "supervisor", however, is not wholly inapt, even in the case of the parent and a child who is not receptive to advice, let alone instruction. Use of the term "supervisor" reflects some important features of the legislative regulation of learning to drive a motor vehicle on public roads. It is convenient to identify those legislative features by particular reference to provisions of the Traffic Act (NT), the Motor Vehicles Act (NT) and the Traffic Regulations (NT) as they were in force at the time of the accident that gives rise to the present litigation. First, driving on a public street in the Territory without a current licence to drive was prohibited83. Provision was made84 for the issue of learner's permits (called a "permit licence") but such a permit would be issued only if the applicant was aged more than 16 years and had passed a test of knowledge of road rules85. (If the applicant had attained the age of 16 years but not the age of 16 years and 6 months, the applicant had also to have passed an approved training course86.) 83 Traffic Act (NT), s 32(1). 84 Motor Vehicles Act (NT), s 9. 85 Motor Vehicles Act, s 10(1). 86 Motor Vehicles Act, s 10(1). The holder of a learner's permit was required87 to display L-plates on the vehicle and to be accompanied88 by the holder of a full (as distinct from provisional) licence to drive. The licensed driver had to sit in the front passenger seat89 and that licensed driver was liable90 for an offence committed by the learner driver "as if the licence holder was the driver of the vehicle". It is this last feature of the statutory landscape which suggests that the licensed driver who sits beside a learner driver is in a position to supervise the learner's conduct. But nothing in the applicable Northern Territory legislation and regulations required the licensed driver to offer the learner some instruction about how to drive. That was a matter left to the participants to resolve. Hence the conclusion, stated earlier, that the use of the word "instructor" may not be apposite if it connotes an educative process. Because the accident happened in the Northern Territory, particular regard must be had to the law of the Territory. That was the law of the place of the wrong91. In considering the development of the common law of Australia, however, it is necessary to consider whether there is a "consistent pattern of legislative policy to which the common law in Australia can adapt itself"92. In that regard, it may be noted that the then applicable regulatory provisions in some Australian jurisdictions other than the Northern Territory placed the licensed driver who must accompany a learner driver in a position of supervision93. By contrast, in South Australia, the accompanying driver was required to supervise and instruct the learner driver in the safe and efficient driving of the motor vehicle94, and in Tasmania, the accompanying driver was to 87 Traffic Regulations (NT), reg 12(4). 88 reg 12(6). 89 reg 12(2) and (6). 90 reg 12(10). 91 John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503; [2000] HCA 36. 92 Esso Australia Resources Ltd v Federal Commissioner of Taxation (1999) 201 CLR 49 at 61-62 [23] per Gleeson CJ, Gaudron and Gummow JJ; [1999] HCA 67. 93 Road Transport (Driver Licensing) Regulation 1999 (NSW), reg 12(5)(a); Road Transport (Driver Licensing) Regulation 2000 (ACT), reg 21(5)(a). 94 Motor Vehicles Regulations 1996 (SA), reg 27(4). instruct the learner95. It may be doubted, therefore, whether a consistent pattern of legislative policy is to be discerned. Nonetheless, it is convenient, for present purposes, to proceed on the basis that the licensed driver who accompanies a learner driver is obliged at least to supervise the learner. It is not necessary to decide whether the ambit of the supervision that may be asserted by that licensed driver extends beyond ensuring compliance with the road law to include all aspects of the learner's operation of the vehicle. And of course if the licensed driver was bound to "instruct" the learner, the obligations of the licensed driver would more readily be understood as encompassing all aspects of the learner's operation of the vehicle. Rather, it must be recognised that there are limits to what supervision or instruction can achieve. There are limits because no amount of supervision or instruction can alter two facts. First, unless the vehicle has been specially modified to permit dual control, it is the learner driver, not the supervisor or instructor, who operates the vehicle. Second, the skill that is applied in operating the vehicle depends entirely upon the aptitude and experience of the learner driver. What is it about the relationship between supervisor and learner that would lead to the conclusion that the reasonable care which the learner must use to avoid damage to the supervisor is less than the reasonable care which the learner must show for the safety of others? If the conclusion were to be based upon how the supervisor could influence (even direct) the learner driver, it would be based upon considerations that are more appropriately considered in connection with contributory negligence. If the supervisor could have influenced the outcome it may be that the supervisor failed to take reasonable care for his or her own safety. That is a matter which goes directly to questions of contributory negligence; it does not touch the question of the driver's negligence. And if the supervisor could not have influenced the outcome, what is the relevance of the supervisory role to the standard of care the learner should exercise in operating the vehicle? No different standard of care The common law recognises many circumstances in which the standard of care expected of a person takes account of some matter that warrants identifying a class of persons or activities as required to exercise a standard of care different 95 Vehicle and Traffic (Driver Licensing and Vehicle Registration) Regulations 2000 (Tas), reg 8(7)(a)(i); cf Road Traffic Act 1974 (WA) s 50 and its requirement that a learner driver be accompanied by a "driving instructor". from, or more particular than, that of some wholly general and "objective community ideal"96. Chief among those circumstances is the profession of particular skill. A higher standard of care is applied in those cases. That standard may be described by reference to those who pursue a certain kind of occupation, like that of medical practitioner, or it may be stated, as a higher level of skill, by reference to a more specific class of occupation such as that of the specialist medical practitioner97. At the other end of the spectrum, the standard of care expected of children is attenuated98. But what distinguishes the principle established in Cook v Cook from cases of the kind just mentioned is that Cook v Cook requires the application of a different standard of care to the one defendant in respect of the one incident yielding the same kind of damage to two different persons, according to whether the plaintiff was supervising the defendant's driving or not. In all other cases in which a different level of care is demanded, the relevant standard of care is applied uniformly. No distinction is drawn according to whether the plaintiff was in a position to supervise, even instruct, the defendant although, of course, if the plaintiff was in that position, a failure to supervise or instruct may be of great importance in deciding whether the plaintiff was contributorily negligent. There is no warrant for the distinction that was drawn in Cook v Cook. Cook v Cook should no longer be followed in this respect. The principle adopted in Cook v Cook departed from fundamental principle and achieved no useful result. It is necessary, of course, to recognise that it is a decision that has stood for more than 20 years. Although it seems that there are few if any decided cases in which it has been applied to deny liability, it must be assumed that its application may have affected the terms on which cases have been compromised and the apportionments of responsibility that have been made by courts and parties. Yet despite these considerations, it is better that the departure from principle is now recognised. The plaintiff who was supervising the learner driver, the plaintiff who was another passenger in the vehicle, the plaintiff who was another road user are all entitled to expect that the learner driver will take reasonable care in operating the vehicle. The care that the learner should take is that of the reasonable driver. 96 Fleming, The Law of Torts, 9th ed (1998) at 119. 97 See, for example, Rogers v Whitaker (1992) 175 CLR 479; [1992] HCA 58. 98 McHale v Watson (1966) 115 CLR 199; [1966] HCA 13. As foreshadowed, it is appropriate to say something more about The The Insurance Commissioner v Joyce The plaintiff in Joyce agreed to travel as passenger in a car driven by a person who, two hours after a collision in which the plaintiff passenger was seriously injured, was found very drunk and asleep under a bush near the scene of the accident. This Court divided (Latham CJ, Rich J; Dixon J dissenting) in holding that the passenger must fail in his action. There was a divergence in opinion about whether the evidence permitted the inference that the driver was evidently drunk when the passenger agreed to get into the car. That division need not be explored. Of present relevance is the analysis by Dixon J of the three different bases upon which the claim of a gratuitous passenger who accepted carriage in a vehicle driven by a person known by the passenger to be drunk would then have been held to fail. Those three bases were: first, no breach of duty; second, voluntary assumption of risk; third, contributory negligence (then a complete defence). Of the first of these bases, no breach of duty, Dixon J said99: "[The passenger] has been regarded as depending upon a relation which by accepting a place in the conveyance he sets up between himself and the person responsible for its management. For those who believe that negligence is not a general tort but depends on a duty arising from relations, juxtapositions, situations or conduct or activities, the duty of care thus arises. For those who take the contrary view, the standard of care is thus determined. But whatever be the theory, the principle applied to the case of the drunken driver's passenger is that the care he may expect corresponds with the relation he establishes. If he knowingly accepts the voluntary services of a driver affected by drink, he cannot complain of improper driving caused by his condition, because it involves no breach of duty." (emphasis added) The same outcome was identified as required if the case were to be analysed by reference to principles of voluntary assumption of risk or contributory negligence. And Dixon J concluded100: 99 (1948) 77 CLR 39 at 57. 100 (1948) 77 CLR 39 at 59-60. "Of the three forms I have set out in which the driver may state his defence, for my own part I prefer the first. It appears to me that the circumstances in which the defendant accepts the plaintiff as a passenger and in which the plaintiff accepts the accommodation in the conveyance should determine the measure of duty and that it is a more satisfactory manner of ascertaining their respective rights than by opposing to a fixed measure of duty exculpatory considerations, such as the voluntary assumption of risk or contributory negligence. No doubt as a sufficient degree of knowledge or appreciation of the conditions giving rise to the danger is necessary under the first as well as under the second principle and as the burden of proving knowledge is upon the defendant, little difference will be seen in the forensic application of the two." (emphasis added) All three forms of analysis were said101 to depend upon proof of "some degree of actual knowledge on the part of the passenger of the alcoholic conditions he is accepting". It was recognised102 that there would be no voluntary assumption of risk if "notwithstanding knowledge, the person concerned has exposed himself to the danger only because of the exigency of the situation in which he stands". And it was further recognised103 that there could be special circumstances which made the conduct of accepting a lift from a drunken driver "reasonable and so prevent it from being contributory negligence, as when he cannot otherwise preserve some interest of sufficient value to justify the risk which his conduct entails". No doubt it was the similarity of the circumstances in which application of principles of voluntary assumption of risk and contributory negligence would be qualified that led to the conclusion that little difference was to be seen in the forensic application of these two principles. The view expressed104 by Dixon J, that it was more satisfactory to ascertain the rights of the parties by determining the measure of the defendant's duty according to the circumstances in which the defendant accepted the plaintiff as a passenger than "by opposing to a fixed measure of duty exculpatory considerations, such as the voluntary assumption of risk or contributory negligence", was founded105 on the premise that the standard of care to be applied 101 (1948) 77 CLR 39 at 57. 102 (1948) 77 CLR 39 at 57. 103 (1948) 77 CLR 39 at 58. 104 (1948) 77 CLR 39 at 59. 105 (1948) 77 CLR 39 at 57. depends upon the particular "relations, juxtapositions, situations or conduct or activities" out of which the duty of care arises. More particularly, two aspects of the relations established by a passenger voluntarily accepting carriage by a drunken driver were given primacy: the notion that "if [the injured person] knows of the danger and runs the risk he has no cause of action"106 and that, as Latham CJ said in Joyce107: "In the case of the drunken driver, all standards of care are ignored. The drunken driver cannot even be expected to act sensibly. The other person simply 'chances it.'" It was the combination of those two notions that resulted in the denial of liability, no matter whether the case was analysed as one of no breach of duty, voluntary assumption of risk, or contributory negligence. The introduction of statutory provisions for apportionment of liability on account of contributory negligence would now effectively preclude complete denial of liability in a case like Joyce, if the other two forms of analysis adopted in that case (no breach, and voluntary assumption of risk) were not adopted. It is necessary, therefore, to focus upon those other two forms of analysis. Voluntary assumption of risk is a doctrine "nowadays but rarely invoked with success"108. In some jurisdictions legislation provides109 that a defence of voluntary assumption of risk is not available in some motor accident cases110. And legislation dealing with assumption of risk, by reference to a notion of "obvious risk", is now common111. 106 Cavalier v Pope [1906] AC 428 at 432 per Lord Atkinson, cited in Bond v South Australian Railways Commissioner (1923) 33 CLR 273 at 277 per Knox CJ and Starke J; [1923] HCA 50. 107 (1948) 77 CLR 39 at 46. 108 Fleming, The Law of Torts, 9th ed (1998) at 334. 109 See, for example, Motor Accidents Act 1988 (NSW), s 76; Motor Accidents Compensation Act 1999 (NSW), s 140; Civil Liability Act 1936 (SA), s 47(6), formerly Wrongs Act 1936 (SA), s 24K(6). 110 Joslyn v Berryman (2003) 214 CLR 552 at 563 [28] per McHugh J; [2003] HCA 111 Civil Liability Act 2002 (NSW), ss 5F-5I; Wrongs Act 1958 (Vic), ss 53-56; Civil Liability Act 1936 (SA), ss 36-39; Civil Liability Act 2003 (Q), ss 13-16; Civil (Footnote continues on next page) None of these statutory provisions was said to be engaged in this case. And because it was not suggested that any of these provisions was engaged, it will be convenient, in the balance of these reasons, to deal with the subject of voluntary assumption of risk without specific reference to the provisions. What is said, however, must be read recognising that if any of the provisions that have been mentioned is engaged, regard must first be had to the statute. Absent relevant statutory modification, the doctrine of voluntary assumption of risk requires112 proof that "the plaintiff freely and voluntarily, with full knowledge of the nature and extent of the risk ... impliedly agreed to incur it". In the absence of some express exclusion of liability or notice of exculpation, demonstrating that a plaintiff both knew of a risk and voluntarily agreed to incur that risk will often be difficult. But if both conditions are satisfied, the plaintiff's claim against the defendant will fail. And the conclusion that a plaintiff voluntarily assumed the risk in question is readily seen as equivalent to concluding that the defendant owed that plaintiff no duty of care. The conclusion that a defendant owed the plaintiff no duty of care is open in a case like Joyce if, as Latham CJ said113, "[i]n the case of the drunken driver, all standards of care are ignored [because the] drunken driver cannot even be expected to act sensibly" (emphasis added). And as indicated earlier in these reasons, it is that same idea which would underpin a conclusion that the plaintiff voluntarily assumed the risk of being driven by a drunken driver. But the analysis that has been made also reveals that a plaintiff's knowledge of the deficiencies of the defendant does not so readily lead to a conclusion of the kind reached in Cook v Cook: that the defendant does owe the plaintiff a duty of care, but that the standard of care to be met is less than the standard which otherwise would be expected. Liability Act 2002 (WA), ss 5E-5F and ss 5M-5P; Civil Liability Act 2002 (Tas), ss 15-17; cf Civil Law (Wrongs) Act 2002 (ACT), ss 42-44. 112 Yarmouth v France (1887) 19 QBD 647 at 657 per Lord Esher MR; Osborne v London and North Western Railway Co (1888) 21 QBD 220 at 223, 224 per Wills J; Letang v Ottawa Electric Railway Co [1926] AC 725 at 731 per Lord 113 (1948) 77 CLR 39 at 46. Reference was made114 in Cook v Cook to the example cited115 by Latham CJ in Joyce of the person who gives a watch to a blacksmith for repair: "If a person deliberately agrees to allow a blacksmith to mend his watch, it may well be said that he agrees to accept a low standard of skill. But even in such a case, the blacksmith is bound to act sensibly, though he is not subject to the responsibilities of a skilled watchmaker." The accuracy of the conclusion expressed may readily be accepted, if only because acting sensibly, the blacksmith should, perhaps, refuse to undertake the task116. But the proposition is not one that provides a safe basis for extrapolation into a general proposition that the standard of care to be met varies according to the state of the plaintiff's knowledge of the defendant's ability to reach that standard. A plaintiff's knowledge and the standard of care Actual knowledge of a defendant's inability to reach a standard of reasonable care may be a necessary, but it would not be a sufficient, step towards a conclusion about voluntary assumption of risk. And both what a plaintiff actually knows, and what that plaintiff ought reasonably to have known, will be relevant to an inquiry about contributory negligence. The answers to both questions (about what a plaintiff knew and what a plaintiff ought to have known) will bear upon whether the plaintiff failed to take reasonable care for his or her own safety. Standing alone, however, a plaintiff's actual knowledge of good reasons to think that the defendant may not meet the standard of the reasonable person provides no sufficient or certain basis for concluding that some lesser yet objective standard of care should be applied. It provides no sufficient basis for that conclusion because there is an unarticulated middle step in reasoning from a plaintiff's knowledge that a defendant may not use reasonable care, to applying to the resolution of a claim for damages for negligence an objective, and thus generalised, standard of care which reduces the required standard of care by reference to some known attribute of the defendant. That middle step can be described in a number of different ways. Using the language of Dixon J in 114 1986) 162 CLR 376 at 382 per Mason, Wilson, Deane and Dawson JJ. 115 (1948) 77 CLR 39 at 46. 116 cf Papatonakis v Australian Telecommunications Commission (1985) 156 CLR 7 at 36 per Deane J; [1985] HCA 3. Joyce117, it could be described as a step that defines or identifies the relevant "relations, juxtapositions, situations or conduct or activities" of or between the parties. Alternatively, it could be described as a step of identifying the relevant characteristics of the hypothesised reasonable actor whose conduct sets the standard of care that is being applied. It is not necessary to choose between those descriptions for they are not intended to be different in their operation. But without first identifying how that middle step is to be taken, the state of the plaintiff's actual knowledge of the defendant's deficiencies provides no certain basis for a conclusion about what is the relevant standard of care. Joyce held118 that no relevant reasonable actor could be identified in that case because a drunken driver "cannot even be expected to act sensibly". By contrast, in Cook v Cook, the relevant reasonable actor was identified119 by the plurality as the "unqualified and inexperienced driver (but with some knowledge of the controls of a motor vehicle) in the situation in which the [driver] was placed when the [licensed driver] instructed her to turn left". As noted earlier, in his separate reasons Brennan J described120 the relevant reasonable actor as "an inexperienced driver of ordinary prudence". The finding of negligence in the courts below Although this matter was decided at trial and on appeal to the Court of Appeal by application to the first respondent of too lax a standard of care, he was found not to have satisfied that standard. It follows that the appellant was entitled to succeed in his claim against both respondents. Had the correct standard of care been applied, the first respondent would have been held negligent. It also follows that the respondents' application for special leave to appeal, to contend first, that the first respondent owed the appellant a standard of care less onerous than that of the reasonable driver, and secondly, that the appellant's claim should accordingly have been dismissed, should be refused. 117 (1948) 77 CLR 39 at 57. 118 (1948) 77 CLR 39 at 46 per Latham CJ. 119 (1986) 162 CLR 376 at 388. 120 (1986) 162 CLR 376 at 394. The findings of contributory negligence in the courts below The findings of contributory negligence in the courts below proceeded from the premise that, taking reasonable care for his own safety, the appellant would have given different instructions to the first respondent. The primary judge identified121 three different instructions the appellant could and should have given the first respondent: "[B]efore [the first respondent] drove on Larapinta Drive, [first] that in the event that the vehicle entered on to the shoulders he ought not to change direction sharply and [second, that] he ought not to accelerate when seeking to return to the road surface proper. [Third, the appellant] having seen the tyre, should have pointed out to the first [respondent] that the proper course was for him to drive over the top of it." In the Court of Appeal, the events which comprised the accident were analysed rather differently from the way in which the primary judge had analysed them. But the differences in analysis were directed to what it was that the first respondent had done that might depart from the standard of care as identified in Cook v Cook. The primary judge's findings about the respects in which the appellant had been contributorily negligent were not disturbed. In this Court the appellant submitted that the primary judge erred in finding that the appellant should have instructed the first respondent not to change direction sharply and not to accelerate when seeking to return to the road surface proper. It was submitted that these instructions reflected too closely what eventually happened and that they were, therefore, instructions crafted only with the benefit of hindsight122. It followed, so the appellant submitted, that the finding was founded on a false premise: that it was reasonable to expect the appellant to offer the first respondent a litany of instructions that would cover every possible eventuality that might have been encountered on the road. It may be accepted that the primary judge's findings about the first two instructions to be given were framed with particular application to the events that 121 [2006] NSWSC 680 at [84]-[85]. 122 cf Romeo v Conservation Commission (NT) (1998) 192 CLR 431; Vairy v Wyong Shire Council (2005) 223 CLR 422. had happened. Reduced to their essentials, however, both instructions amounted to a single piece of advice: do nothing sudden when driving on a dirt road. It was open to the primary judge to find that failure to offer this kind of advice to the first respondent amounted to a want of care for the appellant's own safety. Although the appellant submitted that the primary judge also erred in finding that the appellant had been contributorily negligent in not telling the first respondent to straddle the debris on the roadway, that submission was not further developed. Again it was open to the primary judge to find that the appellant had not taken reasonable care for his own safety when he had observed the debris but had not told the first respondent how to deal with it. As noted earlier, the Court of Appeal set aside the apportionment of responsibility at which the trial judge had arrived. In doing so the Court of Appeal was, of course, comparing the extent to which the departure from what was required of the appellant and the first respondent caused or contributed to the appellant's damage. And in doing that the Court of Appeal was necessarily measuring the responsibility of the first respondent against a lesser standard of care than we would hold to be applicable. No doubt the same point may be made about the basis upon which the primary judge made his apportionment. When it is recognised that one particular respect in which the appellant was found to be contributorily negligent was the failure, having observed the debris on the road, to instruct the first respondent to straddle it, we are of the view that it is right to conclude that the appellant's responsibility for the accident was not insignificant. When coupled with a failure to offer the basic advice to a learner driver to make no sudden change of direction or speed on a dirt road, an apportionment of 30 per cent contributory negligence to the appellant was not unjust. Rather than prolong this litigation further, it is better that this Court substitute its view of the proper apportionment of responsibility by adopting the proportions that were assigned by the primary judge. For these reasons, we would order that the appeal to this Court be allowed with costs. The respondents' application for special leave to appeal to this Court should be refused with costs. The orders of the Court of Appeal of the Supreme Court of New South Wales made on 2 July and 23 July 2007 should be set aside. There was no challenge, in this Court, to some conclusions of the Court of Appeal that would require adjustment of the amount of the verdict entered for the present appellant at trial. The parties should have 7 days in which to submit agreed minutes of the orders this Court should make in consequence of allowing the appeal. In default of agreement upon the orders to be made, each side should file and serve within 14 days of the date of making this order its written submissions as to the form of the orders it contends should be made, and its argument in support of those submissions. Kirby KIRBY J. This appeal comes from a sharply divided decision of the Court of Appeal of New South Wales123. It concerns the common law duty of care owed by a learner driver to a passenger in his motor vehicle who, as a result of the driver's incompetence and inexperience, is injured. The Court of Appeal ultimately upheld the entitlement of Mr Paul Imbree ("the appellant") to recover damages from the driver and owner of the motor vehicle in which he was travelling as a passenger when he was injured and rendered tetraplegic124. However, by a different combination of judges, the damages awarded to the appellant at trial by Studdert J ("the primary judge") were reduced by two-thirds (as against the one-third found by the primary judge)125 because of the appellant's contributory negligence. In this Court the contesting parties seek the substitution of orders favourable to their respective contentions. The challenge to the principle in Cook v Cook The decision in Cook: The proceedings concern the principles that apply to the appellant's recovery under the common law of Australia. Those principles arise for consideration in the context of the liability owed by a driver and owner of a motor vehicle, where an unlicensed learner driver is driving the vehicle under the supervision of a passenger sitting next to him who is fully aware of the driver's inexperience and who is injured as a result of it. In Australia, since 1986, the liability of an inexperienced driver to such a passenger and derivatively of the owner of the vehicle (which in this case was the appellant's employer) has been determined in accordance with the decision of this Court in Cook v Cook126. By the principle stated in that decision, this Court held that the duty of care owed to such a passenger was limited. It was that "reasonably to be expected of an unqualified and inexperienced driver in the circumstances"127. Correctly, the primary judge and all the judges in the Court of Appeal applied that principle. The challenge to the decision: In this Court, the appellant secured special leave to appeal to argue (amongst other things) that Cook was incorrectly decided 123 McNeilly v Imbree (2007) 47 MVR 536. 124 Per Beazley and Basten JJA; Tobias JA dissenting. See joint reasons at [35]. 125 Imbree v McNeilly [2006] NSWSC 680 at [91]. 126 (1986) 162 CLR 376; [1986] HCA 73. 127 (1986) 162 CLR 376 at 384 per Mason, Wilson, Deane and Dawson JJ. Kirby and should no longer be followed; that the principle applicable was one requiring a single, universal, objective standard of care, irrespective of the personal attributes of the driver (including age, inexperience and incompetence); and that, by that standard, there was negligence by the driver and no contributory negligence on the part of the appellant or, at least, that the apportionment made by the primary judge should be restored. The respondents defended the principle in Cook as "correct, but requir[ing] re-statement in contemporary terms". Additionally, they sought special leave to appeal to argue that the driver owed the appellant a less onerous duty of care than that of the normal experienced and licensed driver; that the appellant's entire claim for damages for negligence should be dismissed; or that (at the least) the ultimate orders of the Court of Appeal should be affirmed. Conclusions on the challenge: I agree in the essential conclusions expressed in the reasons of Gummow, Hayne and Kiefel JJ ("the joint reasons"). Specifically, I agree that: The principle in Cook should no longer be followed by Australian courts128; The appellant was entitled to succeed in his claim for negligence against the respondents by reason of the standard of care which the driver owed to him in the circumstances described129; (3) Accordingly, the respondents' application for special leave to propound a duty by the driver to the appellant of an inconsistent and lesser ambit should be refused130; and The discount for contributory negligence ordered by the Court of Appeal was erroneous and that of the primary judge should be restored131. I agree with much that is written in the joint reasons. However, important to my conclusion concerning the duty of care owed by the driver to the appellant is the fact that such liability, although arising under the common law, falls to be determined in the context of statutory prescriptions, enacted in substantially 128 Joint reasons at [71]-[72]. 129 Joint reasons at [88]. 130 Joint reasons at [89]. 131 Joint reasons at [95]-[96]. Kirby common form throughout Australia, providing for a compulsory scheme of third party insurance for the liability of all drivers (and owners) of motor vehicles operating on public roads throughout the nation. Such insurance affords indemnity to drivers and owners against the risk of liability for injury to third parties – whether other passengers in the motor vehicle, drivers or passengers in other motor vehicles or pedestrians – injured on a public road as a result of negligent driving132. Factor of compulsory insurance: The added consideration of compulsory insurance was referred to in the reasons of Lord Denning MR in Nettleship v Weston133. In a factual context similar to that arising in the present appeal, his Lordship departed (as we effectively do) from the approach of Dixon J in The Insurance Commissioner v Joyce134. Lord Denning often exhibited a tendency to identify novel considerations that challenged formal reasoning135. Over the years since Lord Denning wrote his opinion on this subject a greater realisation has emerged concerning the influence that statute has upon the content of the common law. Moreover, judges (and others) are more willing than in the past to acknowledge the relevance of insurance (especially compulsory statutory insurance) to the content of negligence liability, suggesting an acceptance that it is a consideration material to defining the content and standard of the duty of care owed in the circumstances. The ambit of that duty is, in turn, also relevant to the application to this case of further statutory provisions, also applicable throughout Australia, providing for apportionment of liability in respect of proved contributory negligence136. The relevance of the added consideration of compulsory insurance has been discussed in various cases. It was also addressed in the argument of these proceedings before this Court137. It is clearly an aspect of the social reality in 132 In the Northern Territory, the relevant legislation is the Motor Vehicles Act (NT). 133 [1971] 2 QB 691 at 699-700. 134 (1948) 77 CLR 39 at 56; [1948] HCA 17. See Nettleship [1971] 2 QB 691 at 700. 135 cf Re Minister for Immigration and Multicultural Affairs; Ex parte Applicant S20/2002; Appellant S106/2002 v Minister for Immigration and Multicultural Affairs (2003) 77 ALJR 1165; 198 ALR 59; [2003] HCA 30. 136 In the Northern Territory, the applicable law is the Law Reform (Miscellaneous Provisions) Act (NT), s 16(1). The other laws of Australia providing for apportionment are noted in Joslyn v Berryman (2003) 214 CLR 552 at 563 [27] (fn 40) per McHugh J; [2003] HCA 34. 137 See eg [2008] HCATrans 182 at 400-500, 2275-2375, 3280-3290. Kirby which the common law principle falls to be expounded in this case. Its existence encourages my acceptance of a single universal, objective standard of care owed by all drivers. Giving weight to the consideration of compulsory insurance accords with a growing preparedness of the courts to acknowledge the influence of insurance, at least where it is compulsory and provided by statute, in defining the content of legal liability. I would not therefore ignore this consideration. Without giving weight to the availability of compulsory statutory insurance, it would be difficult, in my view, to justify a change in this Court's approach as expressed in Cook138. Despite the super-added ingredient of "proximity" introduced in that case, the decision in Cook essentially followed a line of negligence reasoning that can be traced to Dixon J's dissenting opinion in Joyce139. That is, reasoning that measures the existence and ambit of a duty of care in negligence by reference to personal considerations, of which the inexperience, lack of qualifications and inadequate training and instruction of a learner driver of a motor vehicle are clearly prime examples. Essentiality of the consideration: For this Court to overturn Cook and to substitute a single, uniform and objective standard as the criterion for the existence and ambit of the duty of care, owed by one motorist to third parties, a new legal ingredient is necessary. What is that ingredient that authorises and obliges this Court to adopt a different approach? In my opinion, it is the existence of compulsory motor vehicle third party insurance: a statutory phenomenon that has existed in the context of motor vehicle accidents in Australia for approximately 60 years. Since the inception of this statutory regime, in default of proof of the currency of such insurance, a person's vehicle will not be registered for use on public roads anywhere in the Commonwealth. If such compulsory insurance were not part of the legal background to the expression of the applicable common law, and if it were the case, or even possible, that someone in the position of the driver (or the owner) of the vehicle would, or might, be personally liable for the consequences of that person's driving affecting a passenger (such as the appellant) or other third party it is extremely unlikely, in my view, that the courts would impose on them liability, as in the case of the appellant's claim, sounding in millions of dollars. Such a course would be unrealistic and futile, characteristics the courts usually endeavour to avoid. 138 (1986) 162 CLR 376. 139 (1948) 77 CLR 39 at 59-60. Kirby Repeatedly in recent years this Court has insisted that the proper place to start in legal analysis, where relevant statutory provisions exist, is the statute140. Compulsory third party motor vehicle insurance statutes were enacted throughout Australia between 1935 and 1949. Since then, they have assumed an established place on the legal landscape141. Aside from some matters of detail, they are fundamentally identical. Whatever may be the relevance of liability insurance for other areas of substantive law, in the field of liability of drivers and owners of motor vehicles to those whom they injure, the time has come to adjust the fiction of individual personal liability. This Court should acknowledge the relevance of compulsory insurance to the content of the liability for motor vehicle accident liability. We should draw from the existence of such insurance a persuasive reason for departing from the individual culpability principle previously expressed by this Court in Joyce's case and applied in Cook. In doing so, we should adopt the single, universal, objective standard now proposed by the joint reasons in this Court. After 60 years, it is time that fiction acknowledged reality. The facts, approach and relevant legislation The facts: The basic facts are explained in the joint reasons142. At trial, the respondents submitted, in accordance with the principle in Cook, that Mr Jesse McNeilly143 (the driver) owed the appellant no duty of care because of several considerations revealed in the evidence144. Alternatively, they suggested that the duty owed was limited by such considerations. Thus, the respondents relied on the following facts which, they submitted, were pertinent to the personal culpability of the learner driver in charge of the vehicle when it overturned, injuring the appellant: 140 See cases collected in Central Bayside General Practice Association Ltd v Commissioner of State Revenue (Vic) (2006) 228 CLR 168 at 198 [84] (fn 86); [2006] HCA 43. 141 See Fleming, The Law of Torts, 9th ed (1998) at 442 citing Motor Vehicle Act 1949 (NT); Motor Accidents Act 1988 (NSW); Motor Car Act 1958 (Vic); Motor Accident Insurance Act 1994 (Q); Motor Vehicle Act 1959 (SA); Motor Vehicle (Third Party Insurance) Act 1943 (WA); Motor Accidents (Liability and Compensation) Act 1973 (Tas); and Motor Traffic Act 1936 (ACT). 142 Joint reasons at [28]-[32]. 143 As noted in the joint reasons, except in the title to the appeal in this Court, the first respondent's first given name is recorded as "Jesse". As in the joint reasons, that spelling is adopted here. 144 Imbree [2006] NSWSC 680 at [41]. Kirby The driver was a learner driver: young, inexperienced and unlicensed; The appellant allowed the driver to drive the vehicle in which he was a passenger, knowing that he had these limitations; He allowed the driver to drive on a roadway that was obviously unsuitable for a driver with such a lack of experience; He did so notwithstanding road signs that clearly warned of the dangers of "loose surface, dust, corrugations" and stated "careful driving techniques are advised"145; He allowed this in circumstances of awareness of occasional obstructions on the roadway, such as discarded tyres; and He failed to give careful instruction before and whilst the vehicle was driven, as the conditions obviously demanded. Notwithstanding submissions that it was no longer to be regarded as expressing the law146, the primary judge properly held himself bound to apply the reasoning of this Court in Cook. Studdert J therefore turned to consider whether the appellant could recover notwithstanding that the standard of care that could be expected of the driver had to be adjusted to fit the special relationship that arose in the circumstances, namely that of an instructor/supervisor and a learner Was the duty of care required of the driver (and hence of the respondents) diminished, or even eliminated, because the appellant was aware of the exceptional circumstances that made it unreasonable for him to expect a learner driver to be able to meet the standards of an ordinary, reasonable driver engaged in driving a vehicle in such demanding and potentially dangerous conditions? Would an analysis in accordance with Cook, purporting to apply the general approach of Dixon J in Joyce's case148, justify a reduction, or even the elimination of liability on the part of the respondents because the appellant had: 145 [2006] NSWSC 680 at [19]. 146 [2006] NSWSC 680 at [44]-[45]. 147 [2006] NSWSC 680 at [48]-[49] applying Cook (1986) 162 CLR 376 at 384. 148 (1948) 77 CLR 39 at 56-59. See Cook (1986) 162 CLR 376 at 384-387. Kirby Voluntarily accepted for himself the risks of being a passenger in a vehicle driven by such a driver in such circumstances; . Contributed by his own negligence to the very type of consequence that flowed from permitting a driver of such limited skills to drive the vehicle in such specially dangerous conditions, particularly without affording him adequate instruction and warnings before and during the time that he was driving the vehicle; or Denied himself entitlement to recovery by knowingly permitting the driver to take charge of the vehicle, although he was unlicensed under the applicable law of the Northern Territory (including as a learner, provisional driver or permit licence holder)149? The approach: In response to the foregoing submissions, an immediate question was presented by the fact that the negligence and contributory negligence (if any) occurred in the Northern Territory although the appellant's proceedings were brought, and fell to be decided, in the courts of New South Wales. In Australia, this course of action was legally permissible. New South Wales courts are bound to apply to the facts the law of the place of the wrong. In this case, that law was the law of the Northern Territory150. The common law of Australia is the same in all parts of the Commonwealth. It is to be applied by all courts, subject to any modification occasioned by any relevant statute law "of the place where the acts or omissions occurred that give rise to the civil wrong in question"151. A number of provisions of the statute law of the Northern Territory were drawn to attention and need to be examined. The relevant legislation: The statute law of the Northern Territory includes legislation, as in other States and Territories of the Commonwealth, obliging all drivers and owners of vehicles driven on public roads in the Territory 149 Motor Vehicles Act (NT), s 9; Traffic Regulations (NT), regs 11, 12. The provisions of s 9 of the Motor Vehicles Act (NT) were replaced with effect from 21 June 2007 by the Transport Legislation (Road Safety) Amendment Act 2007 (NT), s 5. 150 John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 540 [86]-[87], 562-563 [157]; [2000] HCA 36. 151 John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 563 [157]. Kirby to be insured against third party risk. The provision in force at the time of the appellant's injury was the Motor Vehicle Act (NT). The respondents' motor vehicle was insured under a compulsory third party motor vehicle insurance policy which, although issued elsewhere in Australia (namely in New South Wales), indemnified the driver and owner of the vehicle against liability resulting from an injury to a third party (such as the appellant) in the Northern Territory. Although the appellant sued to recover from the driver and owner of the motor vehicle, it was uncontested that their liability was undifferentiated. Both of them were represented by lawyers retained by the compulsory third party insurer. In practical terms, the issue of legal principle contested in this appeal concerns the ultimate liability of such insurers for negligence occasioned by the acts and omissions of inexperienced learner drivers such as Mr McNeilly. Throughout the Commonwealth, legislation has also been enacted in the several States and Territories, governing the issuing of licences and permits, including to learner drivers and learner licensees152. Provisions, either in statute or (more commonly) in regulations153, govern various obligations in the case of learner drivers. Such regulations typically concern the obligatory presence of an accompanying licensed driver; the affixing of "L" plates to signify that a learner driver is driving; the obligation of zero or of a diminished permitted blood alcohol level whilst driving; and the observation of a reduced maximum speed. Moreover, in the several States and Territories, differing rules are applicable to licensed drivers who accompany learner drivers or permit holders, specifying the 152 Road Transport (Driver Licensing) Act 1998 (NSW), ss 19-20. 153 Traffic Regulations (NT), regs 11, 12; cf Road Transport (Driver Licensing) Act 1998 (NSW), ss 19, 20 and Road Transport (Driver Licensing) Regulation 1999 (NSW), reg 12(1)(a); Transport Operations (Road Use Management) Act 1995 (Q), s 171(1) and Transport Operations (Road Use Management – Driver Licensing) Regulation 1999 (Q), reg 6(9); Motor Vehicles Act 1959 (SA), s 145(1) and Motor Vehicles Regulations 1996 (SA), reg 28; Road Safety Act 1986 (Vic), s 95(1) and Road Safety (Drivers) Regulations 1999 (Vic), reg 213(1); Road Traffic Act 1974 (WA), s 111 and Road Traffic (Authorisation to Drive) Regulations 2008 (WA) regs 44-55; Vehicle and Traffic Act 1999 (Tas), s 45 and Vehicle and Traffic (Driver Licensing and Vehicle Registration) Regulations 2000 (Tas), reg 8(7); Road Transport (Driver Licensing) Act 1999 (ACT), ss 26, 28 and Road Transport (Driver Licensing) Regulation 2000 (ACT), reg 21(4) and (5). Kirby extent of the accompanying driver's obligations to supervise and/or instruct the pupil154. The foregoing licensing legislation, including in the Northern Territory, obviously contemplates regulation of the training of learner drivers by licensed drivers who thereby assume a measure of responsibility for such training155. As the joint reasons point out156, there are differences in the language of such regulations. In the Northern Territory, it appears sufficient that the licensed driver should travel in a front seat of a vehicle with a learner157 whereas in other Australian jurisdictions express requirements of "supervision" or "instruction" apply. Accepting that some supervision is inherent in the circumstances, a question remains as to the content of that obligation and as to whether omissions or shortcomings operate to eliminate or diminish the driver's common law duty of care to third parties, including to the supervising passenger. No breach of any Northern Territory regulation or statute was pleaded against the appellant nor particularised at trial. Nor was any such breach relied on, or suggested, by any of the judges in the Supreme Court. This Court has long established that provisions made, by or under statute, for the licensing of persons and things do not necessarily create a private right of action in another person injured by the conduct of those who were not licensed158. In the present case, any non-compliance with the regulations was not, as such, causative of the events leading to the appellant's injuries. At most, the regulations do no more than affirm what commonsense dictates, namely that the supervising passenger who is a licensed driver, accompanying the inexperienced learner driver, should give all reasonable advice and information so as to ensure the safety of the vehicle and of others potentially affected whilst it is being so driven. But does any knowledge on the part of the supervising passenger eliminate or diminish the duty of care owed by the learner driver? Alternatively, does it afford the driver a defence of contributory negligence which that driver 154 See Road Transport (Driver Licensing) Regulation 1999 (NSW), reg 12(5) ("supervise"). 155 Northern Territory Government, Driving In The Northern Territory – Road Users' Handbook, 2nd ed (2007) at 5. 156 Joint reasons at [64]-[65]. 157 Traffic Regulations (NT), reg 12(2). 158 Leask Timber and Hardware Pty Ltd v Thorne (1961) 106 CLR 33 at 38 per Dixon CJ, 42 per Kitto J, 46 per Taylor J, 47 per Windeyer J; [1961] HCA 73. Kirby (and the owner) can plead and prove to reduce the recoverable damages proportionately to the respective contributions to the damage? The essential question for decision The essential question: The fundamental question for decision is whether, as this Court held in Cook, the content and ambit of any duty of care owed to a person in the position of the appellant is what is "reasonably to be expected of an unqualified and inexperienced driver in the circumstances"? Alternatively, is it a single, universal, objective standard of care applicable to all drivers (experienced and inexperienced; skilled and unskilled; licensed and unlicensed) when they undertake the driving of a motor vehicle on a public road? I leave aside the driving of objects that are not motor vehicles. I do not deal with driving on private property or the control of objects on the water or in the air. I omit any consideration of the special case of stolen motor vehicles where particular statutory or policy provisions may affect the resolution of the issue. In all of these cases, different considerations may apply. But what is the law applicable to a case such as the present – the normal case of a driver of a motor vehicle on a public road? As the casebooks show, injuries and accidents caused by learner drivers, whilst in charge of motor vehicles on public roads, are not uncommon. Inevitably, licensed and experienced drivers will have (or develop) defects of various kinds that may diminish their capacity to drive motor vehicles with reasonable care, either generally or in particular circumstances. Similarly, different learner drivers will exhibit distinctive and varying abilities (or lack thereof) to perform the functions of driving a motor vehicle with reasonable care. In such matters, and much else, human beings differ in their skills and capacities. Proficiency in the driving of motor vehicles varies in accordance with individual characteristics such as age, eyesight, hearing, manual dexterity, spatial perception, intelligence, comprehension, reaction speed, transient or long-term emotional conditions and so forth. Yet all of those with the ability to drive a motor vehicle with normal care were once learners. Moreover, in order to arrive at reasonable skill in driving, it is necessary to expose the learner to opportunities for varying experiences in driving, both under skilled instruction and under the instruction of non-professional family members or friends, in safe and secluded places as well as public roads presenting varying degrees of challenge for a novice. Opinions in answer: It is no coincidence that the common law of negligence developed from a tort originally expressed by reference to particular categories to one later explained by reference to an overarching legal theory. This Kirby evolution occurred at a time when motor vehicles presented many negligence claims to the courts159. In Australia, this Court has gradually replaced many special rules that were responses to earlier particular case situations with general principles of broad application160. Necessarily, however, any broad principles of the common law must themselves adapt to relevant legislation. Sometimes, such legislation is confined to particular jurisdictions. Whilst it must be applied there, it may not impact on the single common law applicable throughout Australia161. On the other hand, occasionally, legislation may include common themes that apply throughout the nation. In such cases, the common law principle may itself adapt to such legislative provisions. Such is the flexibility and practicality of judge- made law162. Thus, the question presented by these proceedings is whether the existence throughout Australia of legal requirements governing owners and drivers of motor vehicles, to secure and maintain defined insurance against the risks of injury to third parties as a precondition to valid registration and driving of vehicles anywhere in the Commonwealth, is such a universal feature of Australian statute law as to inform the content of the common law rule that is then to be expressed in answer to the question of legal principle presented by this appeal? Until now, the answer to that question has generally been assumed (or stated) to be in the negative. In part, this has been because of an approach taken to the suggested irrelevance of insurance in deriving the content of substantive law. It has also, in part, been specific to the significance of insurance for the law of negligence as it affects the liability of owners and drivers of motor vehicles. In the past, this Court has generally ignored the existence of compulsory 159 See Donoghue v Stevenson [1932] AC 562 at 580-581. 160 See eg Papatonakis v Australian Telecommunications Commission (1985) 156 CLR 7 at 21, 22, 32; [1985] HCA 3; Burnie Port Authority v General Jones Pty Ltd (1994) 179 CLR 520 at 541-544, 547-548; [1994] HCA 13; Jones v Bartlett (2000) 205 CLR 166 at 237 [244]; [2000] HCA 56. 161 Joint reasons at [61]-[65]. 162 Esso Australia Resources Ltd v Federal Commissioner of Taxation (1999) 201 CLR 49 at 61-62 [23]; [1999] HCA 67. Kirby insurance163. Occasionally, when it has been considered (although in contexts different from the present), the relevance of such insurance has been denied164. In England, compulsory liability insurance for owners and drivers of motor vehicles was adopted in 1930, following the pioneering example of New Zealand in 1928165. The relevance of insurance for some aspects of the liability of drivers of motor vehicles was accepted, at least by Lord Denning, in 1971. In Nettleship166, explaining why he could not endorse the approach of Dixon J in Joyce's case, Lord Denning said, in a case having several factual similarities to the present167: "The learner driver may be doing his best, but his incompetent best is not good enough. He must drive in as good a manner as a driver of skill, experience and care, who is sound in mind and limb, who makes no errors of judgment, has good eyesight and hearing, and is free from any infirmity.168 The high standard thus imposed by the judges is, I believe, largely the result of the policy of the Road Traffic Acts. Parliament requires every driver to be insured against third party risks. The reason is so that a person injured by a motor car should not be left to bear the loss on his own, but should be compensated out of the insurance fund. The fund is better able to bear it than he can. But the injured person is only able to recover if the driver is liable in law. So the judges see to it that he is liable, unless he can prove care and skill of a high standard.169 Thus we are, in this branch of the law, moving away from the concept: 'No liability without fault.' We are beginning to apply the test: 'On whom should the 163 As in Joyce (1948) 77 CLR 39 and Cook (1986) 162 CLR 376. 164 As in Lamb v Cotogno (1987) 164 CLR 1; [1987] HCA 47. 165 Fleming, The Law of Torts, 9th ed (1998) at 442. 167 [1971] 2 QB 691 at 699-670. 168 Citing Richley v Faull [1965] 1 WLR 1454; [1965] 3 All ER 109 and Watson v Thomas S Whitney & Co Ltd [1966] 1 WLR 57; [1966] 1 All ER 122. 169 Citing The Merchant Prince [1892] P 179 and Henderson v Henry E Jenkins & Sons [1970] AC 282. Kirby risk fall?' Morally the learner driver is not at fault; but legally she is liable to be because she is insured and the risk should fall on her." In the same case, Salmon LJ agreed with Lord Denning but only in part. He held that "a learner driver is responsible and owes a duty in civil law towards persons on or near the highway to drive with the same degree of skill and care as that of the reasonably competent and experienced driver"170. However, in respect of passengers, his Lordship held that a "special relationship" might displace "this standard or even [negative] any duty, although the onus would certainly be upon the driver to establish such facts"171. In coming to his view, in dissent on this point, Salmon LJ applied the reasoning of Dixon J in Joyce's case. He declared that although that decision had been delivered in 1948, nothing had happened "since which makes it any less convincing now than it was then".172 The third judge in Nettleship (Megaw LJ) agreed with Lord Denning in disapproving the approach of Dixon J in Joyce's case and specifically Dixon J's opinion173 that: "[T]he circumstances in which the defendant [driver] accepts the plaintiff as a passenger and in which the plaintiff accepts the accommodation in the conveyance should determine the measure of duty". According to Megaw LJ174: "Theoretically, the principle as thus expounded is attractive. But, with very great respect, I venture to think that the theoretical attraction should yield to practical considerations." Megaw LJ listed a number of such "practical considerations" that brought him to a different conclusion. These included175: 170 [1971] 2 QB 691 at 703. 171 [1971] 2 QB 691 at 703. 172 [1971] 2 QB 691 at 704. This was a riposte to Lord Denning's suggestion, at 701, that Dixon J "might think differently today". 173 [1971] 2 QB 691 at 707. 174 [1971] 2 QB 691 at 707 referring to Joyce (1948) 77 CLR 39 at 59. 175 [1971] 2 QB 691 at 707-709. Kirby The unpredictability and uncertainty of having differing standards of care owed by the same driver to passengers compared to those owed to other motorists and to pedestrians; The time-consuming debates that would then arise as to the precise knowledge and extent of experience of the learner driver and the standard of the competence and experience of the instructor; The possibility that the defects of the learner driver might not become known to the victim of negligence until the very incident occurred which was alleged to give rise to civil liability; The desirability in "our legal process" of avoiding "varying standards, depending on such complex and elusive factors"176; and The logic inherent in Dixon J's approach would be applicable not just to passengers travelling with learner drivers but also to passengers travelling with other non-learner drivers having known defects or limitations of a physical or temperamental kind. Megaw LJ did not himself refer to the existence of compulsory insurance. In this Court, in support of his argument, the appellant essentially embraced Megaw LJ's list. He argued that it was sufficient to rebut the respondents' arguments that, in the absence of "morally blameworthy" conduct on the part of the driver, they were not legally liable. Re-expressing legal doctrine: It is easy enough to understand why, in this appeal, the appellant skirted around the consideration of compulsory insurance. The relevance of that consideration is, and has long been, a controversial question in our law177. The appellant would not wish to embrace needless controversies. However, the advocate's task, which is to win a case, is not the same as that of a judge, least of all a judge in this Court. When this Court is asked to express governing legal doctrine, and especially when (as here) the formidable reasons of Dixon J in Joyce's case and the explicit holding of the Court in Cook stand in the way of re-expression, it is necessary, in my view, to grapple with the consideration of compulsory third party motor vehicle insurance. That element clearly played a part in 176 [1971] 2 QB 691 at 708. 177 See eg Lewis, "Insurance and the tort system", (2005) 25 Legal Studies 85 at 94-95, Kirby Lord Denning's reasoning in Nettleship. We too should give weight to it. We should do so not to revive obedience to the opinions of English courts (about which Cook continues to state the law applicable to courts in this country178). Instead, we should do so because the common thread in the majority reasoning in Nettleship was the rejection of the "theoretically attractive" approach of Dixon J in Joyce's case out of a preference for "practical considerations" that inform judgments about the liability of drivers, including learner drivers, to third parties. Self-evidently, the consideration that, by law, all such drivers in Australia are indemnified by compulsory third party motor vehicle insurance is a consideration of the greatest practicality and importance. Cook is a decision that has stood for more than 20 years. Countless decisions of courts, lawyers and insurance personnel have been made on the strength of its correctness. In addition, in the past 20 years, many legislative interventions have been adopted in Australia against the background of the principle in Cook. Such laws have regulated both the scope of the indemnity, available under compulsory motor vehicle policies, and the ambit of recovery applicable to persons injured in motor accidents179. I recognise the force of the respondents' argument to the effect that this Court should leave Cook to stand, in the expectation that, if change were needed, because of perceptions of injustice to injured passengers supervising or travelling with learner drivers, such a change should be left to the legislatures which have not been inactive in this field. In some ways, the problem presented in this appeal is similar to that in Brodie v Singleton Shire Council180. Here, too, the issue whether this Court should override established law, and re-express it in a different way, is not clear-cut. For me, its resolution, once again, is a close run thing181. The re-expression of the law has obvious economic consequences about which this Court has no or little specific information. Contrary considerations: Moreover, quite apart from the ordinary considerations of legal authority and judicial restraint, there are (as Lord Denning and Megaw LJ both acknowledged in Nettleship) reasons of legal principle and policy that give a measure of support to the approach adopted in Cook, grounded 178 Cook (1986) 162 CLR 376 at 390. 179 See, for example, State and Federal legislation enacted in recent times collected in Masel (ed), The Laws of Australia: Torts (2003) at 24-26 [3] including legislation on motor accidents and civil liability in most jurisdictions of Australia. 180 (2001) 206 CLR 512 at 591-604 [203]-[237]; [2001] HCA 29. 181 (2001) 206 CLR 512 at 600 [226]. Kirby as it is in the influential reasons of Dixon J in Joyce's case. This is so despite the dalliance in Cook with the now discarded criterion of "proximity". At the core of common law negligence liability lie notions defined by reference to standards that may be expected of a reasonable person. If a person knowingly agrees to travel as a passenger with, and to supervise, a young, inexperienced learner driver, without the protection of dual controls or other mechanical means of taking charge of the motor vehicle should the need arise, why not adhere to a principle of law that the knowledge of such a passenger may reduce, or even eliminate, any legal liability on the part of the driver or owner to that passenger182? Other motorists and pedestrians will normally have no such knowledge or means of knowledge. Even the display of "L" plates on a vehicle, driven by a learner driver, will generally give third parties little or no opportunity to avoid damage, assuming that they are conscious of the plates at all. But the case of passengers with actual knowledge of the driver's limitations is different. Given the absence of a universal no fault liability in the common law of negligence, why should the courts not simply adhere to the notion that a passenger who allows an inexperienced, unqualified person to drive a car under his or her inexpert "supervision" can only reasonably expect the standard of care that such a learner driver can ordinarily be expected to exhibit in the given conditions? The answer to these questions depends, in part, on the list of practical and theoretical considerations which Megaw LJ collated in Nettleship. However, these alone would not, in my view, be sufficient to warrant reversal of the settled law of Australia and its re-expression in terms of a new single, universal and objective standard. To take that step, in my view, it is essential to have regard to the important practical feature of the universal existence of compulsory third party motor vehicle insurance in this country. For me, that is the ingredient that tips the balance in favour of a re-expression of the common law of Australia. It renders an elimination, or qualification, of a duty of care in such circumstances unrealistic, with potential consequences that could be seriously disproportionate and unjust and contrary to the statutes. In short, the principle in Cook tends to defeat the large social purposes that lay behind the enactment of compulsory third party motor vehicle insurance in the case of motor vehicle negligence legislation. In the result, the principles in Cook do not stand as a rule of the common law of Australia. The resulting question: But is the existence of such insurance legally irrelevant to the presence and ambit of a duty of care, breach of which is insured against? Did Lord Denning err in Nettleship by referring to this consideration? 182 Joint reasons at [75]-[76]. Kirby Should I, like the joint reasons and the reasons of Heydon J (and Megaw LJ and others before them) simply ignore such insurance and reach my conclusion without any regard to the requirement for compulsory insurance cover183? Upon these questions, differing opinions have been expressed both by judges and by other respected commentators. The suggested irrelevance of compulsory insurance Res inter alios acta: The traditional view of English law was that the existence, or absence, of a policy of insurance between a party sued and an insurer is irrelevant to any issue about the legal liability of the insured in the first place. This approach can be explained in terms of one of the maxims traditionally recognised by English law: "Res inter alios acta alteri nocere non debet". This holds that a transaction between strangers ought not to injure another party184. The general notion lying behind the maxim is that a person ought not to be affected by something done behind the person's back or to which he or she was not personally a party. More specifically, in the context of insurance, the maxim expresses the idea that insurance provides indemnity for whatever might be found to be the legal liability of the insured. Accordingly, so it is said, the existence of insurance and the contents of any policy are matters independent of, and anterior to, the events that are said to enliven the cover. This reasoning has had a considerable impact on legal thinking in common law countries. There are many, even today, who adhere to it, without qualification. Leading cases: The res inter alios acta principle was invoked in this context by Viscount Simonds in Lister v Romford Ice and Cold Storage Co Ltd185: "[A]s a general proposition it has not, I think, been questioned for nearly 200 years that in determining the rights inter se of A and B the fact that one or other of them is insured is to be disregarded". The same judge later reaffirmed his view in Davie v New Merton Board Mills Ltd186. Speaking of the existence of employer indemnity insurance Viscount Simonds stated: 183 See joint reasons and reasons of Heydon J; cf reasons of Gleeson CJ at [21]-[23]. 184 Wingate, Maximes of Reason (1658) at 327; Coke on Littleton, 15th ed (1794), vol 1 at §231. 185 [1957] AC 555 at 576-577 (footnote omitted). 186 [1959] AC 604 at 627. Kirby "[T]his is not a consideration to which your Lordships should give any weight at all in your determination of the rights and obligations of the parties. … It is not the function of a court of law to fasten upon the fortuitous circumstance of insurance to impose a greater burden on the employer than would otherwise lie upon him." A reason for the silence of Megaw LJ on the insurance issue raised by Lord Denning in Nettleship may be explained by Lord Denning's rejection of Megaw LJ's denial of the relevance of insurance in Launchbury v Morgans187, a case decided only five months previously. There, Megaw LJ had said188: "[I]f one were to bring in questions of insurance, one might speculate … [b]ut this court may not, in accordance with its judicial duty, indulge in such speculation. [Counsel] was doing no more than carrying out his duty to the court in refraining from discussing the insurance position." When Launchbury went to the House of Lords, Lord Wilberforce "Liability and insurance are so intermixed that judicially to alter the basis of liability without adequate knowledge (which we have not the means to obtain) as to the impact this might make on the insurance system would be dangerous and, in my opinion, irresponsible." Words to the same effect were expressed at a similar time by Lord Diplock, extra-curially190. He too resisted the idea of imposing liability "irrespective of fault" on "whoever can most easily cover the risk by liability insurance". Doubtless, this was added by way of response to Lord Denning's question in Nettleship191. Yet Lord Diplock accepted192: 188 [1971] 2 QB 245 at 263. 189 Morgans v Launchbury [1973] AC 127 at 137. 190 Diplock, "Judicial Development of Law in the Commonwealth", [1978] 1 Malaysian Law Journal at cviii. 191 [1971] 2 QB 691 at 700. See above these reasons at [132]. 192 Diplock, "Judicial Development of Law in the Commonwealth", [1978] 1 Malaysian Law Journal, cviii at cxii. Kirby "It may be that is the way that we are going. As respects road accidents it is the way, in part at any rate, some Commonwealth jurisdictions have already gone. But this is welfare legislation. It is outside the province of the law of tort: spreading the risk is not a function to be undertaken by judges under the guise of defining a duty of care owed by one citizen to another." In the context of liability insurance, the traditional view just stated has been endorsed in more recent times, both in the House of Lords193 and in the Opinions in this Court: The closest that this Court has come to considering the issue was Lamb v Cotogno195. The question there was whether, having regard to the system of compulsory insurance under the then Motor Vehicles (Third Party Insurance) Act 1942 (NSW), it was legally appropriate to re-express the common law governing the liability of the driver (or owner) of an insured motor vehicle to pay exemplary damages to a person injured because of the high-handed driving of a driver. In the Court of Appeal of New South Wales, in a dissenting opinion, I expressed the view that the enactment of universal compulsory insurance statutes in Australia rendered it anomalous to burden the insurance fund with liability for exemplary damages awarded for a purpose of punishment196. However, this Court was unpersuaded of the need to re-express the common law in that respect197. The essential holding of the Court in the case is found in the Court's conclusion198: "[T]here is no principle or trend to be discerned in the Motor Vehicles (Third Party Insurance) Act or any other legislation concerning the 193 Hunt v Severs [1994] 2 AC 350 at 363 per Lord Bridge of Harwich. 194 Dobson (Litigation Guardian of) v Dobson [1999] 2 SCR 753 at 794-796 [71]-[75] 195 (1987) 164 CLR 1. See also eg Harriton v Stephens (2006) 226 CLR 52 at 95-96 [139]-[140]; [2006] HCA 15. 196 Cotogno v Lamb (No 3) (1986) 5 NSWLR 559 at 566-570. 197 Lamb (1987) 164 CLR 1 at 11. 198 Lamb (1987) 164 CLR 1 at 12; cf Gray v Motor Accident Commission (1998) 196 CLR 1 at 25 [80]; [1998] HCA 70. Kirby measure of damages to be applied in cases of compulsory insurance. Clearly the Act is drafted against the background of the common law and if any inference is to be drawn from it upon the admittedly contentious question of exemplary damages, it is that there was no intention to disturb the existing situation." The Court's decision in Lamb does not decide the legal question presented by the present appeal. Moreover, since Lamb, this Court has repeatedly held that, where any statutory provision has entered upon, and is relevant to, an issue in legal proceedings, the correct starting point in ascertaining the applicable law is not a past expression of the law by judges but its expression in the positive law made by or under statute or a law adapted to such statutory law. Where enacted law (with its larger democratic legitimacy) impinges upon a legal subject matter, the duty of the courts is to ascertain and express the applicable common law by reference to any such legal rule, where it is relevant199. The relevance of compulsory insurance Lord Denning's early views: From early days, Lord Denning expressed the opinion that the "remarkable development" of the law of negligence200 in the years after the mid-1930s was associated with judicial knowledge and recognition of the existence and availability of universal liability insurance. Initially, his Lordship's observation was made in the context of the liability of occupiers for demised premises201. Later it was extended to employers' liability policies202. Later still he referred to the consideration in motor vehicle policies203. His Lordship then extended his reasoning to a wider range of cases204. 199 For a number of cases in which the Court has made this point see Visy Paper Pty Ltd v Australian Competition and Consumer Commission (2003) 216 CLR 1 at 10 [24] (fn 35); [2003] HCA 59; Central Bayside General Practice v Commissioner of State Revenue (Vic) (2006) 228 CLR 168 at 197-198 [84] (fn 86); [2006] HCA 43. 200 Mint v Good [1951] 1 KB 517 at 527 per Denning LJ. 201 As in Mint [1951] 1 KB 517 at 527. 202 Romford Ice and Cold Storage Co Ltd v Lister [1956] 2 QB 180 at 191-192. 203 Mentioned in Romford [1956] 2 QB 180 at 191; Launchbury [1971] 2 QB 245 at 253; Nettleship [1971] 2 QB 691 at 699-700. 204 See eg Dutton v Bognor Regis Urban District Council [1972] 1 QB 373 at 397- 398; Morris v Ford Motor Co Ltd [1973] QB 792 at 798; Lamb v Camden London (Footnote continues on next page) Kirby Later English authority: As time went on, increasing numbers of English judges, in explaining the content of substantive principles of law, found it relevant to refer to the existence of insurance, sometimes compulsory or otherwise voluntary but available and commonly procured insurance. Thus, in Hodgson v Trapp205 Lord Bridge of Harwich, dealing with the deductibility of various benefits from personal injury damages said: "If we have regard to the realities, awards of damages for personal injuries are met from the insurance premiums payable by motorists, employers, occupiers of property, professional men and others. Statutory benefits payable to those in need by reason of impecuniosity or disability are met by the taxpayer. In this context to ask whether the taxpayer, as the 'benevolent donor', intends to benefit 'the wrongdoer' as represented by the insurer who meets the claim at the expense of the appropriate class of policy holders, seems to me entirely artificial. … To allow double recovery in such a case at the expense of both taxpayers and insurers seems to me incapable of justification on any rational ground." Acknowledgment of the potential relevance of insurance to the resolution of questions before the courts was also explained by Lord Griffiths in Smith v Bush206: "There was once a time when it was considered improper even to mention the possible existence of insurance cover in a lawsuit. But those days are long past. Everyone knows that all prudent, professional men carry insurance, and the availability and cost of insurance must be a relevant factor when considering which of two parties should be required to bear the risk of a loss." To like effect was the opinion of Lord Hoffmann in Morgan Crucible Co Plc v Hill Samuel & Co Ltd207. His Lordship considered that economic realities (including the existence of insurance without which "liability would mean personal ruin") could enter into the judgment of whether a duty of care existed Borough Council [1981] QB 625 at 637-638 referring to Photo Production Ltd v Securicor Transport Ltd [1980] AC 827. 205 [1989] AC 807 at 823. 206 [1990] 1 AC 831 at 858. 207 [1991] Ch 295 at 302-303. Kirby and, if so, its definition208. Five years later, in the House of Lords, Lord Hoffmann resisted the assignment of a duty of care in negligence at common law to highway authorities for the imperfect condition of a highway on the basis that "there is compulsory insurance to provide compensation to the victims. There is no reason of policy or justice which requires the highway authority to be an additional defendant."209 In Marc Rich and Co AG v Bishop Rock Marine Co Ltd210, in the context of defining a duty of care by classification societies to cargo owners, Lord Steyn likewise paid specific regard to the probable costs of imposing such a duty, with the consequential requirement that would then arise to obtain non-compulsory insurance. In a later extra-judicial comment211, Lord Steyn elaborated his views: "The primary aim of tort law is the pursuit of corrective justice. It requires somebody who has harmed another without justification to indemnify the other. There is, however, another perspective, namely considerations of distributive justice. It concentrates on the place of the plaintiff and the defendant in society … Not surprisingly, our courts have not shut their eyes to such considerations: the insurance position of parties has sometimes been treated as relevant." New Zealand authority: In New Zealand, a similar evolution in judicial reasoning occurred in the Court of Appeal evidencing a gradual retreat from the rigid rejection of insurance as universally irrelevant to a recognition of its potential impact on more substantive legal obligations. This development may be seen in the reasons of Woodhouse J in Bowen v Paramount Builders (Hamilton) Ltd212 and in Takaro Properties Ltd v Rowling213, 208 In accordance with Caparo Industries Plc v Dickman [1990] 2 AC 605. The holding in Caparo was not followed by this Court in Sullivan v Moody (2001) 207 CLR 562 at 579 [49]; [2001] HCA 59. However, the point made by Lord Hoffmann remains relevant. 209 Stovin v Wise [1996] AC 923 at 958. This raises a question as to whether such a conclusion, unexpressed, may have affected the decision of the majority of this Court in Roads and Traffic Authority v Royal (2008) 82 ALJR 870; 245 ALR 653; [2008] HCA 19. 210 [1996] AC 211 at 239-241. See also Vowles v Evans [2003] 1 WLR 1607 at 1614. 211 Steyn, "Perspectives of Corrective and Distributive Justice in Tort Law", (2002) 37 The Irish Jurist 1 at 4-5. 212 [1977] 1 NZLR 394 at 419. Kirby written before the commencement of the Accident Compensation Act 1982 (NZ). Likewise, in considering the liability of an individual outside that statute for a fire that broke out in his motor vehicle parked in a building which was thereby damaged, Cooke P concluded that214: "The comparative likelihood as to insurance should not have as much weight as the other considerations, but need not be dismissed as altogether irrelevant." Australian authority: In a number of cases, both in this Court and elsewhere, Australian judges have also reflected (although less frequently) the general judicial trends by now emerging elsewhere. In Shaddock & Associates Pty Ltd v Parramatta City Council [No 1]215, for example, Mason J, citing the United States Restatement and contrasting it with the foregoing opinion of Lord Diplock, acknowledged the relevance of considering, when defining the presence and ambit of a duty of care "the availability of insurance as a protection against liability". Earlier, Stephen J in The Willemstad216, had declined to take into account views expressed by legal writers about the desirability of spreading losses through insurance in deciding whether a tortious duty of care existed. On the other hand, in the Supreme Court of Victoria in Seale v Perry217, McGarvie J expressed himself as more sympathetic to what he took as the emerging trend in the English authorities. To like effect was the opinion of King CJ in Robertson v Swincer218 where the availability, cost and likelihood of insurance were considerations that the Supreme Court of South Australia took into account in deciding whether or not to recognise a duty of care out of a particular relationship. Such realities were also given expression by Clarke JA (Gleeson CJ and Hope AJA agreeing) in Lynch v Lynch219 in defining the ambit 213 [1978] 2 NZLR 314 at 323. 214 Mayfair Ltd v Pears [1987] 1 NZLR 459 at 462. 215 (1981) 150 CLR 225 at 250-251; [1981] HCA 59. 216 Caltex Oil (Australia) Pty Ltd v The Dredge "Willemstad" (1976) 136 CLR 529 at 580-581; [1976] HCA 65. 217 [1982] VR 193 at 237-238. 218 (1989) 52 SASR 356 at 361. 219 (1991) 25 NSWLR 411. Kirby of the respondent's recoverable loss in respect of nursing and allied services in a negligence claim. Clarke JA said220: "In the particular context of a compulsory insurance scheme, and when claims against an uninsured defendant who renders gratuitous services could be regarded as quite exceptional, the considerations of policy in favour of allowing the claim far outweigh those that tell in favour of rejecting it." Over the years, I have also recognised the relevance of insurance to substantive obligations under the common law. I did so in the Court of Appeal of New South Wales in several cases concerned with occupiers' and employers' liability221. Similarly, in this Court, I have referred to the availability, cost and likelihood of insurance as relevant considerations in defining the existence, and ambit, of duties of care owed by local authorities222; landlords223; householders engaged in a garage sale224; and small independent contractors engaged by quasi- employers who may or may not be insured225. In Kars v Kars, Toohey, McHugh and Gummow JJ and I, in joint reasons, observed that226: 220 (1991) 25 NSWLR 411 at 420. 221 Brady v Girvan Bros Pty Ltd Trading as Minto Mall (1986) 7 NSWLR 241 at 244; Western Suburbs Hospital v Currie (1987) 9 NSWLR 511 at 518; Cekan v Haines (1990) 21 NSWLR 296 at 300; Johnson v Johnson, unreported, Court of Appeal (NSW), 10 September 1991 at 10-13; Popovic v Wollongong Spanish Club Ltd, unreported, Court of Appeal (NSW), 16 April 1993 at 3. 222 Pyrenees Shire Council v Day (1998) 192 CLR 330 at 424-425 [253]; [1998] HCA 3. 223 Northern Sandblasting Pty Ltd v Harris (1997) 188 CLR 313 at 401-402; [1997] HCA 39; Jones v Bartlett (2000) 205 CLR 166 at 234-235 [236]. 224 Neindorf v Junkovic (2005) 80 ALJR 341 at 356 [65], 358 [76]; 222 ALR 631 at 648, 651; [2005] HCA 75. 225 Sweeney v Boylan Nominees Pty Ltd (2006) 226 CLR 161 at 193 [106]; [2006] HCA 19. 226 (1996) 187 CLR 354 at 381-382 (footnote omitted). Kirby "[A] review of the relevance of insurance to the development of the common law liability in tort may indeed be timely. However, this is not the occasion for it. In the present case, in a context of compulsory insurance provided by legislation, resort is had to the fact of such insurance to do no more than to recognise the reality that the source of the provision of services is not identical to the source of the plaintiff's recovery. It is used simply to contradict the argument of the appellant resting on a manifestly false premise of fact." A question presented in the present proceedings is whether the developments in legal reasoning that I have now elaborated (and there are many more) support the need to go beyond repeatedly asserting manifestly false premises about facts. Such assertions may suggest that a variable definition of an inexperienced driver's duty of care to passengers will discourage parents and friends from giving permission to learners to have charge of a vehicle when this would be unsafe. Or that it would promote more attention by a supervising passenger to duties of instruction to learner drivers about dangers. Or that it would exclude or moderate recoverable damages to a court with notions of personal culpability. Given the existence of statutory compulsory third party motor vehicle insurance any such suggestions are unrealistic. Compulsory insurance: a special case: In addition to the foregoing Australian cases, there are many earlier decisions in which I have suggested that the existence of compulsory insurance, (particularly in the context of motor vehicle accidents but also in compulsory employer's liability), necessarily provides a contextual consideration that influences the answer to questions such as the existence of a propounded duty of care; its ambit and definition; and the consequences for liability and damages that flow from this consideration227. I have repeated such views in this Court228. Initially, on this subject I was a lone voice. However, as I have shown, in other countries, especially England, this is no longer so. Sometimes, Australian law takes a greater time to catch up with shifts in legal doctrine. The present appeal affords us such an opportunity. The resistance of judges and others to the assignment of risks to a party simply because it has "deep pockets" and has procured insurance against liability, is understandable. However, that concern may be readily distinguished from the 227 Cotogno (No 3) (1986) 5 NSWLR 559 at 570-571; Maitland City Council v Myers (1988) 8 MVR 113 at 119-120; Holland v Tarlinton (1989) 10 MVR 129 at 133- 134; Kappos v Berghoffer (1990) 11 MVR 480 at 481-482; Mitchell v Government Insurance Office (NSW) (1992) 15 MVR 369 at 371-372; Williams v Government Insurance Office (NSW) (1995) 21 MVR 148 at 154. 228 See eg, Gray (1998) 196 CLR 1 at 25 [80], 26-27 [82]. Kirby present case. Here, the liability insurance is compulsory. It has been mandated by statute in respect of the Northern Territory (and everywhere else in Australia) for 60 years and more. It cannot be seriously denied that the existence of this insurance has profoundly affected court decisions in motor vehicle negligence cases. It has done so on such questions as when a duty of care attaches; what the duty requires; and what damages may be recovered in circumstances that would otherwise be ruinous or futile. The availability and existence of voluntary liability insurance is one thing. The compulsory provisions for universal statutory third party insurance of all motor vehicles registered for use on Australian roads is quite another. The latter form of insurance exists to provide coverage against "fault" on the part of drivers of motor vehicles. It does so because of the recognition, by the 1930s, that the use of vehicles would inevitably occasion a toll of death and injury, for which a system of compulsory insurance was essential. That system was necessary to prevent intolerable burdens of unrecoverable losses falling upon persons injured in consequence of the ever-increasing use of motor vehicles on Australian roads of varying conditions. Such persons would otherwise often have been thrown back upon social security entitlements, welfare agencies or their families. Instead, a statutory insurance fund was provided from subventions paid by all motorists. That is the context in which the applicable principle of the common law falls to be determined. Another way in which the existence of compulsory third party motor vehicle insurance operates in this area of tort law concerns the applicability of the second purpose of tort law, namely to encourage care to avoid personal liability and thereby to modify potentially harmful behaviour229. Where, as in this context, the payment of a compulsory (but relatively small) premium exempts the driver or owner from personal liability for negligence in all but the most exceptional of cases, it is hard to see how the second objective of the common law is attained. This simply serves to reinforce the conclusion that the common law liability in issue is not "pure". It is a hybrid form of liability in which the common law is inescapably affected by the presence of compulsory statutory insurance. Opinions of scholars: Distinguished text writers have accepted this reality. For example, Professor John Fleming explained230: 229 See eg Neindorf v Junkovic (2005) 80 ALJR 341 at 359-360 [83]-[87]; 222 ALR 230 Fleming, The Law of Torts, 9th ed (1998) at 13; cf Yates v Jones [1990] Aust Torts Reports ¶81-009 at 67,641. Kirby "[W]hile in theory insurance follows liability, in experience insurance often paves the way to liability. In short, it is a 'hidden persuader'." Professor Peter Cane, in his 2006 edition of Atiyah's Accidents, Compensation and the Law231 accepted that insurance has affected the development of negligence law. Particularly so because "the size of damages awards in personal injury cases is explicable only on the basis that judges are influenced by the widespread presence of insurance"232. Professor Michael Jones, in his Textbook on Torts recognised that the availability of compulsory insurance is well known to the courts and that "in some instances this knowledge influences the shape of legal rules … The best example is the very high objective standard of care required of motorists"233. The author suggested that there are "signs that the courts' attitude to liability insurance is changing" from a total denial of relevance to a more nuanced principle of occasional materiality. In the latest edition of their text Tort Law, Professors Simon Deakin, Angus Johnston and Sir Basil Markesinis234 concluded: "Insurance has … made the imposition of liability more frequent in certain areas of the law – especially traffic accidents and products liability – and has induced some strange twists in traditional concepts as a consequence. … overall, there is no denying the fact that, as a result of modern insurance practices, the notions of 'duty' (and causation) are at times used to conceal insurance dictates and the term 'negligence' is employed in contexts where the defendant could not humanly have avoided the accident in question." These authors also argue that235: "[D]espite the difficulties inherent in such exercises, our courts would be well advised … to consider these insurance arguments more openly. For not only has this approach gained acceptance in modern life, whether we 231 7th ed (2006) at 250. 232 7th ed (2006) at 251. 233 Jones, Textbook on Torts, 8th ed (2002) at 13. 234 6th ed (2008) at 14. 235 6th ed (2008) at 14. Kirby like it or not, it also provides a useful tool (along with others) in solving the problems posed by modern tort cases." Even writers such as Professor Jane Stapleton, who has been resistant to the consideration of insurance in the exposition of substantive tort liability, acknowledges what she calls "[t]he special case of motor vehicle accidents"236. As she observes, in that instance237: "[T]here is … no opportunity for prior bargaining: the parties are strangers. But the case has two unusual features: the desire for self- preservation on both sides means that the 'fault' notion can look particularly artificial in this context; and there is a general belief that an individual's chance of being injured by such 'carelessness' in a road accident is not all that much different from their chance of inadvertently causing such injuries to others. This atypical mutuality of risk means that the pools of potential defendants and potential plaintiffs seem virtually identical. In such a situation, compulsory liability insurance, which technically is about cover for negligently causing injury to others, can appear to be equivalent to a system whereby drivers pay into the same pool for cover for the risk of themselves being injured by negligence." Professor Stapleton's plea that courts should be "vigilant not to allow assumptions made in the traffic context to be generalised" may be accepted238. However, in resolving the present appeal, which arises solely in the motor vehicle context, it is sufficient to add the consideration of compulsory third party motor vehicle insurance to the list of practical considerations collected by Megaw LJ, in favour of acknowledging a single, universal, objective definition of the ambit of the duty of care owed by all drivers to those put at risk by their driving. That single standard, obliging observance of a common duty of reasonable care, applies whether the driver is skilled or inexperienced. It extends to the drivers and passengers of other vehicles on the road, to pedestrians, and to passengers in the vehicle who have knowledge of the incompetence of the driver, including a learner driver. Only this approach serves to fulfil the basic objectives 236 Stapleton, "Torts, Insurance and Ideology", (1995) 58 Modern Law Review 820 at 237 Stapleton, "Torts, Insurance and Ideology", (1995) 58 Modern Law Review 820 at 841-842 (footnote omitted). 238 Stapleton, "Torts, Insurance and Ideology", (1995) 58 Modern Law Review 820 at Kirby of the law of negligence in this context as it operates to protect (by compulsory insurance) all those who use the public roads of this country. That is the basic objective of the statutes requiring third party liability insurance for motor vehicles in use on public roads throughout Australia. It is to be reflected in this Court's statement of the duty owed by all drivers under the common law. It is a consideration that this Court should not continue to ignore. Conclusions and orders When, therefore, I add to the considerations listed by Megaw LJ in Nettleship, that of compulsory statutory liability insurance, mentioned there by Lord Denning, and when I add that consideration to those recounted by the joint reasons, I come to the same conclusions as are reached in the joint reasons. The reasoning in Cook is flawed because of its reliance on the now superseded criterion of "proximity". It is therefore proper for this Court to re- examine that reasoning and to place it upon a firmer doctrinal footing. In doing so, the Court should take into account all of the relevant considerations mentioned in past authority, as well as any relevant considerations of legal principle and policy. The latter invite attention to the statutory context in which the common law duty of care owed by a driver on a public road in Australia falls to be defined. That context includes the universal operation of compulsory third party insurance of broad similarity operating throughout the nation. It is well past time, in this special context, that this reality should be acknowledged as affecting the existence and content of the duty of care owed by the driver of a motor vehicle to others reliant on that driver's skill. On this basis I agree in the conclusions expressed by the joint reasons that the statements in Cook as to the duty of care owed by an unqualified and inexperienced driver should be overruled and replaced with the single standard expressed in terms of the imported skill of the "reasonable driver"239. I also agree in the other conclusions reached in the joint reasons, and for the reasons there given, in disposing of the respondents' application for special leave to cross-appeal; and in deciding the remaining questions in the proceedings, including the appellant's appeal against the disturbance by the Court of Appeal of the determination reached by the primary judge on the issue of contributory negligence. It follows that I agree in the orders proposed in the joint reasons240. 239 Joint reasons at [27]. 240 Joint reasons at [97]-[98]. Kirby 185 HEYDON J. The proceedings before Studdert J and the Court of Appeal were necessarily conducted on the assumption that Cook v Cook241 was correct. That assumption was unfavourable to the plaintiff's interests. In this Court the plaintiff advanced many arguments in support of the contention that Cook v Cook should be overruled. But is it necessary to take that step? In the course of argument it became apparent that the conclusion that there had been actionable negligence causing loss to the plaintiff – a conclusion arrived at by the trial judge and upheld by a majority of the Court of Appeal – could be supported without overruling Cook v Cook. Even if the content of the first defendant's duty to the plaintiff was that mandated by Cook v Cook, the conclusion that there should be a verdict for the plaintiff was correct for the reasons given by Studdert J. It is thus not necessary to consider the correctness of Cook v Cook from the point of view of liability. In relation to contributory negligence, the plaintiff put three submissions in this Court. The first was that there was no causal connection between any contributory negligence and the damage which the plaintiff suffered. The second was that the reasoning which caused the Court of Appeal to increase the percentage by which the plaintiff's damages should be reduced for contributory negligence was erroneous. The third was that if the second submission were accepted, the figure selected by the trial judge should be restored even though, if Cook v Cook were wrong, his approach to contributory negligence had been distorted by that case. The plaintiff's first submission on contributory negligence should be rejected. For the reasons given in the plurality judgment, the plaintiff failed to undermine the conclusion of the courts below that the contributory negligence of the plaintiff had been a cause of the damage that he suffered242. That controversy does not depend on the correctness of Cook v Cook. The plaintiff's second submission about contributory negligence was that while the Court of Appeal majority did not disagree with the three respects in which Studdert J found the plaintiff to have been guilty of contributory negligence, they weighted the relevant factors differently. It was submitted that this did not sufficiently expose any error justifying alteration of Studdert J's percentage. This submission is correct. If the plaintiff had contended that Studdert J's necessary acceptance of Cook v Cook had led him to select too high a percentage for contributory 241 (1986) 162 CLR 376; [1986] HCA 73. negligence, it would have been necessary to examine the question whether Cook v Cook was correct. But the plaintiff's third submission on contributory negligence involved an acceptance of the conclusion reached by Studdert J as to the correct percentage deduction. Like the first two submissions on contributory negligence, it therefore did not involve any reconsideration of Cook v Cook. It follows that the Court of Appeal's orders, so far as they were controversial, can be reversed, and those of Studdert J restored, by accepting submissions of the plaintiff other than the submission that Cook v Cook should be overruled. The plaintiff's submission that Cook v Cook be overruled is not a necessary step towards the reversal of the Court of Appeal's orders or the upholding of Studdert J's orders. For that reason I would reserve my opinion on the correctness of that case. The orders proposed in the plurality judgment should be made. Crennan CRENNAN J. I agree that the appeal should be allowed and orders made as proposed by Gummow, Hayne and Kiefel JJ. I agree with the reasons of the Chief Justice and agree also with the reasons of Gummow, Hayne and Kiefel JJ.

HIGH COURT OF AUSTRALIA Matter No S43/2008 APPELLANT AND JESSIE McNEILLY & ANOR RESPONDENTS Matter No S392/2007 JESSIE McNEILLY & ANOR APPLICANTS AND RESPONDENT Imbree v McNeilly [No 2] McNeilly v Imbree [No 2] [2008] HCA 47 26 September 2008 S43/2008 & S392/2007 ORDER Matter No S43/2008 1. In place of the orders of the Court of Appeal of the Supreme Court of New South Wales made on 2 July 2007 and 23 July 2007 order: appeal dismissed and cross-appeal allowed; set aside the judgment entered on 22 August 2006 and in its place order that: the plaintiff's damages, before reduction for contributory negligence, be assessed at $11,323,622.46; (iii) the plaintiff's damages be reduced by 30 per cent on account of his contributory negligence; the plaintiff have judgment for $7,926,535.72 with costs of the proceedings at first instance on the ordinary basis up to and thereafter on an indemnity basis; including 22 March 2006, and the defendants pay to the plaintiff interest on the judgment calculated up to 12 September 2008 in the sum of $875,000 and thereafter until payment at the rate of $1,100 per day; the defendants have credit in the sum of $3,744,060.84; the appellants and cross-respondents (Jessie McNeilly and Qantas Airways Ltd) pay the costs of the respondent and cross-appellant (Paul Anthony Imbree) of the appeal and the cross-appeal to the Court of Appeal on an indemnity basis. 2. Further order that the costs of the appeal to this Court are to be assessed on an indemnity basis. On appeal from the Supreme Court of New South Wales Representation A S Morrison SC with M R Hall and A J Stone for the appellant in S43/2008 and the respondent in S392/2007 (instructed by Turner Whelan) K P Rewell SC with M A Cleary for the respondents in S43/2008 and the applicants in S392/2007 (instructed by TL Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Imbree v McNeilly [No 2] McNeilly v Imbree [No 2] Procedure – Costs – Offers of compromise – Calderbank offer – Effect. GUMMOW, KIRBY, HAYNE, HEYDON, CRENNAN AND KIEFEL JJ. On 28 August 2008, the Court published reasons for decision in these matters1. The Court made orders allowing the appeal in Matter No S43 of 2008, with costs, and refusing the related application for special leave to appeal (Matter No S392 of 2007), again with costs. In the appeal this Court set aside the orders of the Court of Appeal of the Supreme Court of New South Wales made on 2 July 2007 and 23 July 2007, but the making of further consequential orders was deferred to permit the parties to attempt to agree upon their form, or to identify the points of difference between them. The parties have agreed upon the amount for which Mr Imbree should have judgment, the amount of interest on judgment that should be allowed, and the amount for which the respondents, Mr NcNeilly and Qantas Airways Ltd, should have credit against the judgment and interest. The parties also agree that Mr Imbree should have his costs of the proceedings at first instance in the Supreme Court of New South Wales on the ordinary basis up to and including 22 March 2006 and thereafter on an indemnity basis. The respondents accept that Mr Imbree should also have his costs of the proceedings in the Court of Appeal and in this Court. Contrary to submissions made on Mr Imbree's behalf, however, the respondents say that the costs of the proceedings in the Court of Appeal and in this Court should be on an ordinary basis not an indemnity basis. The competing positions of the parties depend upon what effect is to be given to three offers Mr Imbree made to compromise his claim. The first offer On 21 March 2006, Mr Imbree made an offer of compromise pursuant to r 20.26 of the Uniform Civil Procedure Rules 2005 (NSW). That offer, open for acceptance until 4.00 pm on 22 March 2006, was to consent to judgment in his favour "in the sum of $4.5 million clear of payments to date plus costs as agreed or assessed". At that time payments already made by the respondents are said to have "totalled a little over $2.6 million so the gross offer was effectively a little over $7.1 million plus costs". The offer was not accepted. Imbree v McNeilly; McNeilly v Imbree [2008] HCA 40. Kirby Hayne Crennan The trial judge gave judgment on 22 August 2006. The present respondents filed a notice of appeal to the Court of Appeal on 12 September 2006. The appellant subsequently cross-appealed. The second offer On 15 September 2006, after the present respondents had instituted their appeal to the Court of Appeal, Mr Imbree made a fresh offer of compromise pursuant to r 20.26. This offer was to consent to judgment in his favour "in the sum of $7.55 million inclusive of payments to date plus costs as agreed or assessed". The offer was open for acceptance for 28 days from the date of receipt. It was not accepted. The Court of Appeal gave its judgment in July 2007. The third offer On 16 April 2008, after he had obtained special leave to appeal to this Court, Mr Imbree made a Calderbank offer2. He offered to compromise his claim on terms that he have judgment for what was then the agreed quantum of damages ($11,115,290) reduced by 35 per cent for contributory negligence, together with interest and costs of the trial and the proceedings in the High Court, but with each party bearing its own costs of the proceedings in the Court of Appeal. The offer was not accepted. On what basis should costs be assessed? The effect of the consequential orders upon which the parties are now agreed is that Mr Imbree will have judgment for a principal sum of Mr Imbree made separate offers to compromise his claim at each stage of the proceedings: trial, appeal to the Court of Appeal and the appeal to this Court. The questions that might otherwise arise about the effect to be given to an offer 2 Calderbank v Calderbank [1976] Fam 93. Kirby Hayne Crennan made at or before trial, when deciding what order should be made for costs of an appeal3, do not arise and need not be considered. The amount of the judgment that now is to be entered is larger than the amount for which the litigation would have been compromised if any of Mr Imbree's three offers was accepted. (The first offer was to settle for about $7.1 million; the second was to settle for $7.55 million; the third was to settle for a little less than $7.225 million.) In these circumstances, he should have his costs of his appeal to this Court, and his costs in the Court of Appeal, and at trial after 22 March 2006, on an indemnity basis. The costs of the application for special leave should be determined on the ordinary basis. It is therefore not necessary now to make any further order in that application. There should, however, now be further orders made in Matter No S43 of 2008, in addition to those that were pronounced on 28 August 2008. The further orders proposed are founded upon the parties' agreement that judgment should be entered for $7,926,535.72. In order to comply with s 11 of the Law Reform (Miscellaneous Provisions) Act 1965 (NSW) it is necessary to record in the orders "the total damages that would have been recoverable had there been no contributory negligence". Consistent with the parties' agreement, the total damages should be fixed at $11,323,622.46. Further, although the orders entered in the Court of Appeal did not deal expressly with the cross-appeal to that Court, the orders now to be made should do so. That is best done by ordering that the appeal to that Court by the parties who are respondents in this Court is dismissed and ordering that Mr Imbree's cross-appeal to the Court of Appeal is allowed. Further to the orders made on 28 August 2008, there should now be orders as follows: In place of the orders of the Court of Appeal of the Supreme Court of New South Wales made on 2 July 2007 and 23 July 2007, there should be orders: 3 See, for example, Ettingshausen v Australian Consolidated Press Ltd (1995) 38 NSWLR 404; Brymount Pty Ltd v Cummins (No 2) [2005] NSWCA 69; Baresic v Slingshot Holdings Pty Ltd (No 2) [2005] NSWCA 160. Kirby Hayne Crennan appeal dismissed and cross-appeal allowed; set aside the judgment entered on 22 August 2006 and in its place order that: (iii) the plaintiff's damages, before reduction for contributory negligence, be assessed at $11,323,622.46; the plaintiff's damages be reduced by 30 per cent on account of his contributory negligence; the plaintiff have judgment for $7,926,535.72 with costs of the proceedings at first instance on the ordinary basis up to and thereafter on an indemnity basis; including 22 March 2006, and the defendants pay to the plaintiff interest on the judgment calculated up to 12 September 2008 in the sum of $875,000 and thereafter until payment at the rate of $1,100 per day; the defendants have credit in the sum of $3,744,060.84; the appellants and cross-respondents (Jessie McNeilly and Qantas Airways Ltd) pay the costs of the respondent and cross-appellant (Paul Anthony Imbree) of the appeal and the cross-appeal to the Court of Appeal on an indemnity basis. Further order that the costs of the appeal to this Court are to be assessed on an indemnity basis.

HIGH COURT OF AUSTRALIA APPELLANT AND MINISTER FOR IMMIGRATION AND MULTICULTURAL AND INDIGENOUS AFFAIRS & ANOR RESPONDENTS Applicant NABD of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs [2005] HCA 29 26 May 2005 ORDER Appeal dismissed with costs. On appeal from the Federal Court of Australia Representation: M I Bozic SC with J D Smith for the appellant (instructed by Ebsworth & Ebsworth) J Basten QC with S B Lloyd for the first respondent (instructed by Australian Government Solicitor) No appearance for the second respondent Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Applicant NABD of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs Administrative law – Judicial review – Immigration – Refugees – Appellant, an Iranian, sought a protection visa on the basis that he had converted to Christianity after leaving Iran – Refugee Review Tribunal twice affirmed decision to refuse the appellant a protection visa – Relying on information contained in a country profile, the Tribunal distinguished between Christians in Iran who quietly go about their devotions and those who actively or conspicuously proselytise, and considered that only the latter group would encounter a real chance of persecution – Whether Tribunal asked itself a wrong question by seeking to categorise the way in which the appellant expressed his beliefs – Whether Tribunal addressed whether appellant had a well-founded fear of persecution on the ground of religion – Whether Tribunal had committed jurisdictional error similar to the error identified in Appellant S395/2002 v Minister for Immigration and Multicultural Affairs. International human rights law – Refugees – Refugees Convention – Ground of religion – Freedom of religion as a basic human right. Migration Act 1958 (Cth), s 36(2). Convention relating to the Status of Refugees as amended by Protocol relating to the Status of Refugees. GLEESON CJ. This appeal should be dismissed with costs. The decisions of Emmett J at first instance in the Federal Court, and the Full Court of the Federal Court on appeal, were correct. As in Appellant S395/2002 v Minister for Immigration and Multicultural Affairs1, the present appellant argues that the Refugee Review Tribunal, by to a supposed difference between discreet and attaching significance confrontational behaviour, fell into jurisdictional error, and, in particular, failed to address the question that arose for decision. As in Appellant S395/2002, on my reading of the reasons of the Tribunal, the references to different kinds of behaviour were made in the course of a legitimate process of reasoning on an issue thrown up by the facts of the particular case, and involved no jurisdictional error. The basic facts and issues are set out in the reasons of Hayne and The appellant claimed that he had a well-founded fear that if he returned to Iran he would be persecuted on the ground of religion. In many, perhaps most, cases, the primary basis for what is said to be a well-founded fear of future persecution is an account of past persecution, usually given as the reason for leaving a country of nationality. So it was in this case. The appellant gave an account of flight from Iran into Turkey, with the assistance of a people smuggler, after the Iranian authorities had carried out a raid on the house of a friend who was encouraging the appellant to become a Christian. In elaboration of that case, the appellant said that he travelled to Indonesia, where he studied Christianity further, and became a member of the Uniting Church. He then came to Australia. The appellant's primary case was disbelieved. The story of the raid by the authorities was considered to be fabricated. The Tribunal found that the appellant, who frequently travelled on business, had left Iran legally on his own passport. However, while expressing "serious reservations" about the appellant's motivation, the Tribunal was prepared to accept that he had joined the Uniting Church while in Indonesia. It also accepted that he had undertaken a bible study course of correspondence, and had attended Christian religious gatherings in Indonesia and in a detention centre in Australia. The Tribunal found that he had engaged in activities including "the distribution of pamphlets, speaking to others privately about his faith and encouraging interested persons to attend church services." (2003) 216 CLR 473. Having thus rejected the appellant's evidence of actual persecution in Iran, but having accepted that the appellant had become a Christian after leaving Iran, the Tribunal addressed the question of what was likely to happen to the appellant on account of his religion if he returned to Iran. It was in that context that the Tribunal examined country information concerning the treatment of Christians in Iran. The effect of the country information, from a number of sources, including the Department of Foreign Affairs and Trade, the United States State Department, a professor at the California State University, and newspaper reports, was that there is no simple answer to the question whether Christians are persecuted in Iran. The ultimate concern of the Tribunal, of course, was with the appellant, not with Christians as a class, but it was factually relevant to that concern to consider the country information, and it was legitimate to endeavour to relate generalisations about the treatment of Christians to the position, or likely position, of the appellant. It is not clear what else the Tribunal could do. It did not believe that the appellant had been persecuted in the past because of his interest in Christianity. It was prepared to accept that he had become a Christian after leaving Iran. It was reasonable, and necessary, to inquire about how Christians are treated in Iran. It was not suggested, and it could not reasonably be suggested, that the information considered by the Tribunal was irrelevant. No such ground of appeal is advanced. Naturally, the country information was not related specifically to the case of the appellant, and it was necessary for the Tribunal to deal with it as best it could or, alternatively, dismiss it as entirely unhelpful. That was a choice to be made by the Tribunal in its role as a finder of fact. The country information on the subject of the treatment of Christians in Iran distinguished between "converts to Christianity who go about their devotions quietly and maintain a low profile [who] are generally not disturbed" and persons involved in the "aggressive outreach through proselytising by adherents of some more fundamental faiths". The distinction thus drawn is far from clear-cut, but it is not meaningless. It was open to the Tribunal, as a matter of factual judgment, to accept the distinction offered by the information, and to regard it as useful in considering the position of the appellant. The Tribunal noted that the Uniting Church was not one of the "fundamental faiths" that require proselytising by their adherents, and it did not regard the conduct of the appellant since he had converted to Christianity as involving "aggressive outreach". It made the following findings: "The Tribunal finds that the applicant is able to practise his faith in Iran as he has done outside that country and without facing a real chance of persecution. It is not satisfied that there are any essential aspects of his faith he would be constrained in practising in Iran due to any well-founded fear of persecution. In weighing all the evidence, including the applicant's practice of his faith to date and the tenets of that faith, the Tribunal finds that any decision to avoid proselytizing in Iran or of actively seeking attention on matters of religion is not inconsistent with his beliefs and practices. It finds that the present applicant is not constrained in the practice of his avowed faith, nor would he be in Iran, due to a perception that to behave more openly or aggressively would leave him at risk of persecution." Once the Tribunal accepted, as it was entitled to do on the basis of the country information, that not all Christians in Iran suffer persecution, or a real chance of persecution, then it was required to consider the individual circumstances of the appellant in the light of the available information. It could hardly be contended that, whether they realise it or not, all Christians in Iran are being persecuted by reason of the fact that, if they were ever to turn to "aggressive outreach through proselytising" (even though they may have no intention of doing so), they would suffer retribution. That would be to debase the currency of the language which the Tribunal was bound to apply. Nor could it be contended that any Iranian who becomes a Christian of any denomination suffers a real chance of persecution if he or she ever returns to Iran. That would be tantamount to saying that the country information was completely misleading, and was based on a misunderstanding of what amounts to persecution. No such case was argued. The Tribunal gave proper consideration to the particular circumstances of the appellant. In considering what might happen if he were to return to Iran, it applied a distinction which was neither meaningless nor irrelevant. Its process of factual reasoning was open on the evidence. No jurisdictional error has been shown. McHugh 12 McHUGH J. The issue in this appeal is whether, in assessing the appellant's entitlement to a protection visa under the Migration Act 1958 (Cth), the Refugee Review Tribunal made a jurisdictional error as a result of categorising Iranian Christians as aggressive proselytisers – who would be persecuted for religious beliefs – and quiet evangelists – who would not be persecuted for their beliefs. In my opinion, the Tribunal erred in so categorising Iranian Christians. As a result, the Tribunal failed to direct its mind to, or at all events diverted itself from, the critical issue in the case. That was whether the appellant had a well- founded fear of persecution by reason of his religious beliefs. The duty of the Tribunal was to consider the claims of the appellant by reference to his characteristics and circumstances. This was not a case where determination of a claim for refugee status was advanced or assisted by categorising an applicant as falling within or without a particular sub-group. The evidence failed to show that Christians in Iran are subdivided into "proselytising Christians" and "quietly evangelising Christians". Even more importantly it failed to show that the Iranian authorities recognised any such distinction. Because that was so, classification of Christians was not an appropriate method of assessing the appellant's claim for refugee status. The issue of whether Australia owed a protection obligation to the appellant was not to be answered by dividing Christians into two categories and then asking whether the appellant was a member of the category that was likely to be persecuted. Even if the appellant did not fall into that category, it did not follow that he would not be persecuted. By relying on a bipartite category approach, the Tribunal prevented itself from determining the real question in the case and fell into jurisdictional error. The material facts The appellant is an Iranian national, aged 36. He arrived in Australia on 9 November 2000 and lodged an application for a protection (Class XA) visa on 24 November 2000, claiming that he feared persecution by reason of his religious beliefs. The appellant claimed that he had come to the attention of authorities in Iran because of an interest in Christianity and that he fled Iran secretly without a passport. He then spent about seven months in Indonesia during which time he claimed he further explored Christianity resulting in his baptism in West Timor. He claimed that evidence of the baptism was transmitted back to Iran resulting in inquiries by the authorities that had affected his family and that his father had disowned him. Additionally, he claimed he was subjected to some harassment and threats while in Indonesia as a result of his Christian faith and activities connected with it. They included distributing pamphlets about Christianity. The Refugee Review Tribunal accepted that the appellant had befriended a Christian in Iran with whom he discussed Christianity, but it did not accept the McHugh appellant's account that his departure from Iran was precipitated by the attention of the authorities. Nor did it accept that he failed to seek asylum in Indonesia because of a fear of persecution in that country and ignorance of the relevant procedures. The Tribunal found that the appellant was not a witness of truth in respect of these matters and in fact left Iran on his own passport. Because of these findings, matters that happened prior to the appellant's arrival in Australia have no part in this appeal. The matters on which the Tribunal did accept the appellant's account relate to the period after his arrival in Australia when he was detained in the Immigration Detention Centre at Curtin. The Tribunal accepted that over time the appellant might genuinely have embraced Christianity. The Tribunal accepted that certain actions and activities by the appellant manifested the adoption of that religion. These were: his baptism in Indonesia, a Bible study course by correspondence and attendance at religious gatherings in the detention centre that were organised by a minister of the Uniting Church. The Tribunal further accepted that the appellant had engaged in the religious activities he described at his hearing. These included: distribution of pamphlets about Christianity, speaking to others privately about his faith and encouraging interested persons to attend church services. In his approach to others, the appellant talked about the ills of Islam and told them about the Bible and Christianity. Manner of sharing faith The issue between the parties is the categorisation undertaken by the Tribunal in assessing the appellant's claim. That categorisation focused particularly on the appellant's method of expressing and conveying his Christian faith to others. The Tribunal adopted this categorisation approach based on "country information" to the effect that certain expressions of Christianity would attract the adverse attention of authorities and lead to persecution. No criticism can be made of the Tribunal's reliance on the sources of "country information". In an application such as the present, where the Tribunal has rejected the applicant's claims of past persecution, the Tribunal has only two bases for assessing the likelihood of future persecution. The first is the applicant's conduct in detention. The second is information concerning whether that conduct and any claimed intended conduct would raise a real chance of persecution if the applicant was returned to the country of nationality. Likewise, no criticism can be made of the Tribunal's discussion of the test for a "well-founded fear of persecution". The Tribunal described a well-founded fear as one based on a "real chance", "one that is not remote or insubstantial or a far-fetched possibility". The Tribunal rightly noted that "[a] person can have a McHugh well-founded fear of persecution even though the possibility of the persecution occurring is well below 50 per cent"2. Country information In reaching its conclusion that the appellant did not have a well-founded fear of persecution, the Tribunal relied on a number of passages in the "country information" before the Tribunal on which it relied. It is necessary to set them out in order to understand the reasoning process it employed and the error in that process. The United States State Department reported3: "The Christian community is estimated at approximately 117,000 persons according to government figures. Of these the majority consists of ethnic Protestant denominations and Armenians and Assyro-Chaldeans. evangelical churches also are active; although non-ethnically based faith groups report a greater degree of restriction imposed by authorities on their activities." The Commonwealth Department of Foreign Affairs and Trade observed4: "Iranians who had based their asylum applications on their conversion from Islam to Christianity would, in almost all cases not suffer particular problems if returned, unless they declared to the authorities on return their new religious affiliation. Apostasy is widely reported as carrying a nominal death sentence. However there are only one or two cases (high profile Christian clergy) where this sentence has ever been imposed. … The evidence is that those converts who go about their devotions quietly are generally not disturbed (it is either those who actively in conspicuous proselytization, who have run into difficulties, usually with the local mosque rather than the State authorities. … seek attention, or who are engaged Death sentences for apostasy have traditionally been issued to Baha'is and occasionally Christian converts who have been active in proselytising. However, the death sentence has rarely been carried out for 2 See also Chan v Minister for Immigration and Ethnic Affairs (1989) 169 CLR 379 at 389 per Mason CJ; Minister for Immigration and Ethnic Affairs v Guo (1997) 191 CLR 559 at 571-572 per Brennan CJ, Dawson, Toohey, Gaudron, McHugh 3 Annual Report on International Religious Freedom for 1999: Iran (1999). 4 Country Profile for Use in Refugee Determination: Islamic Republic of Iran McHugh apostasy alone. The majority of religious judges appear reluctant to deliver an execution order for this 'offence' alone. People who do publicly convert away from Islam would however be harassed, possibly imprisoned and threatened with death, if they had been found to be active in proselytising among Muslims. … While the traditional Christian communities (Armenian and Assyrian) do not proselytise and even discourage those Muslims who may express an interest in conversion, the Catholic, Protestant and Evangelical missionary churches have tended to face greater problems with the authorities on account of their links with the West and the greater importance placed on proselytising. Any action interpreted as manifesting an intent to 'influence a Muslim to convert faith' is a serious criminal offence both for the priest and the Muslim concerned. Definition of this provision in the criminal code is moreover arbitrary and ambiguous. Its application is intended to harass. Converts are generally tolerated as long as they maintain a very low profile." The Tribunal also gave weight to information provided to the Canadian Refugee and Immigration Board in 1999 by two different university professors that: "it was not a crime to convert from Islam to Christianity in Iran, although people were strongly discouraged from doing so" "a 'simple person' who converted to Christianity would not have serious problems" "it was very unlikely the Iranian authorities would take notice of the conversion of an individual outside Iran, although if converts had previous problems with the authorities or were actively converting others from Islam, they could be of interest to the authorities". Finally, the Tribunal relied on a newspaper article in which minority religious leaders said that there was no reason for non-Muslim people to leave Iran and the trend to flee the country came at a time of increased religious and social tolerance. The Tribunal's reasoning In its reasons, the Tribunal identified a dichotomy from the "country information" on which it relied and assessed the appellant's claim for a protection The Tribunal distinguished between visa based on "conspicuous", "aggressive" or "active" proselytising and a "quiet sharing of faith" or spreading of the word "as an evangelist". The dichotomy is demonstrated in the following passages from the Tribunal's reasons: that dichotomy. McHugh "[c]onverts who go about their devotions quietly are not bothered; it is only those who actively seek public attention through conspicuous proselytizing who encounter a real chance of persecution." "[c]onverts to Christianity who go about their devotions quietly and maintain a low profile are generally not disturbed … the authorities are not really concerned about ordinary people who convert to Christianity, provided they do not seek to convert others or engage in high profile religious activities." "A distinction can be drawn between the quiet sharing of one's faith as an evangelist and the aggressive outreach through proselytizing by adherents of some more fundamental[ist] faiths." The Tribunal clearly proceeded to assess the appellant on the basis of its two categories. "Although he claims that he feels it his duty to tell others about his faith the evidence is that he is able to do so without facing any serious repercussions providing he does not proselytize." "[t]he applicant would not choose to generally broadcast his practice of Christianity or conspicuously proselytize in Iran. If he were to choose to practise Christianity in Iran and to quietly spread the word the Tribunal concludes there is not a real chance that he would face persecution as a consequence." "The Tribunal accepts that he has discussed Christianity with other detainees, but not that his activities since leaving Iran constitute active attempts to convert others through proselytism as distinct from quiet sharing of his faith." "[t]he applicant is not a member of a denomination that exhorts its adherents to proselytize." "[t]he actual capacity of the applicant to practise his faith in Iran without a well-founded fear of persecution for a Convention reason is consistent both with his Christian teachings in Australia and, similarly, in Indonesia. A requirement to proselytize is not a core component of his faith nor, indeed, at all essential to it." (emphasis added) The appellant submits that the primary error that is revealed in this reasoning process is the failure to assess the appellant according to his individual characteristics and circumstances, that is, a failure to consider whether this appellant faced a real chance of persecution if he was returned to Iran. The error came about, the appellant says, because the Tribunal began by first wrongly two categories of Christian – quiet evangelist and aggressive positing McHugh proselytiser. Only the latter, according to the Tribunal, were attended by a risk of persecution; the former were not at risk. It then considered only whether the appellant belonged to one or other category, concluding that the appellant either faced a chance of persecution or he did not depending on the category assigned. Consequently, the appellant was assessed not according to his individual features and claims but according to an arbitrary classification. The problem with the categorisation approach instead of to stereotypes Dividing applicants for refugee status who fall into social groups, religious sects, nationality or races into sub-categories is a dangerous course. It is dangerous because it has a tendency to assess the applicant's claim by reference the applicant's characteristics and circumstances. The mischief of classification and categorisation in assessing claims for refugee status was discussed in the majority judgments of this Court in Appellant S395/2002 v Minister for Immigration and Multicultural Affairs5. That appeal concerned two Bangladeshi homosexuals who had been refused protection visas by the Tribunal on the basis that, if they lived a discreet life in Bangladesh, they would not be subjected to persecution for their sexuality. Justice Kirby and I identified two errors in the reasoning of the Tribunal. First, the Tribunal constructively failed to exercise its jurisdiction because it erroneously assumed that it is reasonable for a homosexual person in Bangladesh to conform to the laws and social expectations of Bangladeshi society and practice their homosexuality discreetly. The assumption led the Tribunal to fail to consider, in assessing whether the applicants had a well founded fear of persecution, why they had in the past acted discreetly and what consequences might attach to their living openly as homosexuals in that society6. Justices Gummow and Hayne also held that this approach involved jurisdictional error by the Tribunal7. The second jurisdictional error occurred when the Tribunal failed to consider the applicants by reference to the correct "particular social group". By classifying the applicants as discreet homosexuals and analysing the level of persecution that may be expected by that group, the Tribunal failed to assess the applicants as individuals. We said8: (2003) 216 CLR 473. 6 Appellant S395/2002 v Minister for Immigration and Multicultural Affairs (2003) 216 CLR 473 at 490 [43], 492 [50], 493 [51]. 7 Appellant S395/2002 (2003) 216 CLR 473 at 501-502 [83]. 8 Appellant S395/2002 (2003) 216 CLR 473 at 494-495 [55]-[58]. McHugh "[B]y declaring that there is no reason to suppose that the appellants would not continue to act discreetly in the future, the tribunal has effectively broken the genus of 'homosexual males in Bangladesh' into two groups – discreet and non-discreet homosexual males in Bangladesh. the Tribunal directed its mind … consciously or unconsciously, principally to the consequences of the sexual behaviour of the non-discreet members of the particular social group. Certainly, it made only passing reference to other forms of harm to members of the social group generally. And it failed to consider whether the appellants might suffer harm if for one reason or another police, hustlers, employers or other persons became aware of their homosexual identity. The perils faced by the appellants were not necessarily confined to their own conduct, discreet or otherwise. If the Tribunal had placed the appellants in the non-discreet group, it appears that it would have found that they were likely to be persecuted by reason of their membership of that group. Conversely, by placing the appellants in the discreet group, the Tribunal automatically assumed that they would not suffer persecution. But to attempt to resolve the case by this kind of classification was erroneous. It diverted the tribunal from examining and answering the factual questions that were central to the persecution issues. … Whether members of a particular social group are regularly or often persecuted usually assists in determining whether a real chance exists that a particular member of that class will be persecuted. … But neither the persecution of members of a particular social group nor the past persecution of the individual is decisive. History is a guide, not a determinant. … It is a mistake to assume that because members of a group are or are not persecuted, and the applicant is a member of that group, the applicant will or will not be persecuted. The central question is always whether this individual applicant has a 'well-founded fear of being persecuted for reasons of … membership of a particular social group'." (emphasis in original, footnote omitted) Justices Gummow and Hayne in their judgment also pointed to the danger of classification of applicants9: "There are dangers in creating and applying a scheme for classifying claims to protection. Those dangers are greatest if the classes are few and rigidly defined. But whatever scheme is devised, classification carries the 9 Appellant S395/2002 (2003) 216 CLR 473 at 499-500 [76]-[77]. McHugh risk that the individual and distinctive features of a claim are put aside in favour of other, more general features which define the chosen class. Further, there is a serious risk of inverting the proper order of inquiry by arguing from an a priori classification given to the applicant, or the applicant's claim, to a conclusion about what may happen to the applicant if he or she returns to the country of nationality, without giving proper attention to the accuracy or applicability of the class chosen. That is, there is a real risk of assuming (wrongly) that a particular applicant will be treated in the same way as others of that race, religion, social class or political view are treated in that country. It would, for example, be wrong to argue from a premise like 'homosexuality is generally ignored in Bangladesh' to a conclusion that 'this applicant (a homosexual) will not be persecuted on account of his sexuality', without paying close attention to the effect of the qualification of the premise provided by the word 'generally'". Their Honours went on to agree with Kirby J and me that the Tribunal had employed a false dichotomy in assessing the appellants which amounted to a Although the appellant raised in his notice of appeal the first error identified in Appellant S395/2002 – the failure to consider whether the anticipated behaviour of the appellant was a response to the fear of persecution or a voluntary choice – that ground must fail. The Tribunal clearly turned its mind to the reason for the appellant's particular practice of Christianity: "[T]he Tribunal finds that any decision to avoid proselytizing in Iran or of actively seeking attention on matters of religion is not inconsistent with his beliefs and practices. It finds that the present applicant is not constrained in the practice of his avowed faith, nor would he be in Iran, due to a perception that to behave more openly or aggressively would leave him at risk of persecution." Whether or not the Tribunal was right about the appellant's beliefs, or had any evidence for its conclusion (a matter I will consider later), it did consider whether the appellant would refrain from certain forms of practice of Christianity out of a fear of persecution. Having rejected the appellant's claims of past persecution, the Tribunal was entitled to proceed on the basis of its acceptance or rejection of the appellant's claims about his current and intended practice of Christianity. 10 Appellant S395/2002 (2003) 216 CLR 473 at 503 [90]. McHugh When does classification lead to error? Not all classification in refugee cases automatically leads to error. In some cases, classification may be an appropriate method for assessing claims for refugee status. One appropriate case is the classification of the applicant for the purpose of identifying the Refugees Convention reason for which he or she may face persecution. Such cases often raise the question: of which "particular social group" is this applicant a member? The identification of the group may be very broad, such as "Jehovah's Witnesses in Ukraine"11 or it may be refined according to additional circumstances giving rise to the exposure to persecution, such as "married Pakistani women without a close male relative"12 or "young, able-bodied Afghan men"13. The refinement of the category may occur according to place of residence, age, family circumstance, a confessional sub-group within a religion (such as Shi'a or Sunni Muslim), a recognised status within a group and so on. Where such classifications occur, they will aid rather than misdirect the process of assessment. To take an example closer to this case, if there was evidence that, among Christians in Iran, only priests and other ordained persons were ever the subject of mistreatment by the authorities, the only question for the Tribunal would be whether the appellant had such a status within the Christian population, or may be perceived to have that status by those known to persecute. The inquiry in such "sub-group" cases focuses on a quality of the applicant that is susceptible of distinction. The categorisation is according to a feature of the applicant that makes him or her distinguishable from other persons. Subject to the evidence, the classification is one that can readily be affirmed or denied. And, of course, such classification will only be relevant and appropriate if there is evidence that the potential persecutors also make that distinction. If persecution of Christians is generally focused on priests, however, it is of no assistance in determining whether this appellant faces a real chance of persecution to know that he is not a priest. The issue will be whether there is anything in the circumstances of this appellant to take him outside the "general" situation. 11 Minister for Immigration and Multicultural Affairs v Respondents S152/2003 (2004) 78 ALJR 678; 205 ALR 487. 12 Minister for Immigration and Multicultural Affairs v Khawar (2002) 210 CLR 1. 13 Applicant S v Minister for Immigration and Multicultural Affairs (2004) 78 ALJR 854; 206 ALR 242. McHugh The difference between appropriate sub-group classifications and those employed in Appellant S395/2002 and this case is that the latter classifications turn on the applicant's behaviour or the expression of the aspect of the applicant's life which is said to attract persecution for a Convention reason. Gradations of behaviour are inherently difficult to classify, and virtually impossible to divide into two categories. Where the persecution is triggered by awareness or conspicuousness of the conduct claimed to be within the Convention, the Tribunal must take even more care to consider how factors other than the applicant's behaviour may lead to attention from authorities or other citizens. The correct approach involves a careful assessment of the kinds of behaviour that trigger the persecution and the kinds of behaviour in which the applicant has engaged or is likely to engage. And then the Tribunal must consider what other risks of attracting persecution the applicant faces. For example, there may be past persecution or past involvement with authorities for other reasons. Or there may be oppositional family members and neighbours who may inform on an applicant regardless of his or her inconspicuous lifestyle. Where, as in this case, the "country information" is in summary form at a medium level of generality – as may be expected in departmental reports – and there is no past persecution relied on or accepted by the Tribunal, it will be necessary to make a judgment as to whether the anticipated behaviour of the applicant is enough to raise a real chance of persecution. This assessment may involve consideration of a spectra of the practice, conduct or outward display that might attract persecution for a Convention reason. But the assessment must be grounded in the actual situation of the applicant and the evidence he or she presents to the Tribunal. And, as Gummow and Hayne JJ noted in Appellant S395/2002, the fewer the categories of kinds of behaviour employed for making this assessment, the greater the likelihood of falling into the error of merely classifying the applicant according to a false dichotomy and ignoring the gradations within both the evidence of country conditions and the applicant's behaviour14. Gradations the evidence of country conditions may include qualifications that must not be discounted in the use of categories to assess an applicant's claims. In Appellant S395/2002, Gummow and Hayne JJ pointed to the danger of failing to pay attention to the qualification implicit in a term like "generally"15. In the present case, the country information relied on referred to: 14 Appellant S395/2002 (2003) 216 CLR 473 at 499 [76]. 15 Appellant S395/2002 (2003) 216 CLR 473 at 499-500 [77]. McHugh no particular problems for asylum seekers who had based their application on a conversion to Christianity unless they declared to the authorities on return their new religious affiliation; those converts who go about their devotions quietly are generally not disturbed; Converts are generally tolerated as long as they maintain a very low profile. These qualifications alone indicate that this was an inappropriate case for the application of a bipartite classification. There are no recognised sub-groups in Iran of "proselytising Christians" and "quietly evangelising Christians". And even if the evidence supported the proposition that those who could be categorised as "actively proselytising Christians" faced a serious risk of persecution, the finding that this appellant was not such a Christian did not complete the Tribunal's inquiry into his chance of facing persecution. The error in this case As I have explained, the error involved in categorisation and classification occurs only where that process of assessment is inapt to the application. The respondent argued in this Court that the appellant was bound to identify an express or implied statutory prohibition on the method employed by the Tribunal before he could succeed. The Tribunal is obliged to review a reviewable decision in respect of which an application is made for review16. A "decision to refuse to grant a protection visa" is a reviewable decision17. Under s 36(2) of the Migration Act an applicant for a protection visa must be a non-citizen to whom Australia owes protection obligations under the Refugees Convention as amended by the Refugees Protocol. Any error that causes the Tribunal to fail to consider whether the applicant is owed protection obligations is an error going to jurisdiction. The process of categorisation and classification is not what renders the decision in excess of jurisdiction. It is the use of that process to direct the focus of the Tribunal's assessment to something other than the issue of protection obligations owed to the applicant. The task of the Tribunal is mandated by the Migration Act. If the method adopted by the Tribunal prevents the carrying out 16 Migration Act 1958 (Cth), s 414. 17 Migration Act 1958 (Cth), s 411. McHugh of that task, the Tribunal's decision will be attended by error. As Gummow and Hayne JJ said in Appellant S395/200218: "The central question in any particular case is whether there is a well-founded fear of persecution. That requires examination of how this applicant may be treated if he or she returns to the country of nationality. Processes of classification may obscure the essentially individual and fact- specific inquiry which must be made." The first part of the error was the wrong identification of sub-groups of Iranian society. The evidence on which the Tribunal relied did not suggest that the authorities in Iran recognise a sub-group division of active proselytising and quietly evangelising Christians. At most the evidence supported the proposition that those who engaged in aggressive proselytising and conspicuous practice of Christianity faced a greater chance of persecution than other Christians. That conclusion did not support the sub-classification of Christians in Iran generally. The presence of qualifications in the country information about the position of those who behaved less conspicuously or did not proselytise actively and the variety of ways in which that kind of Christian was described indicates that there was no basis for the Tribunal to draw a distinction between the two supposed categories of Christians. Furthermore, the Tribunal employed categorisation in the absence of any evidence that Iranian authorities tolerate any form of faith sharing. The Tribunal's key step in its reasoning process, that a "distinction can be drawn between the quiet sharing of one's faith as an evangelist and the aggressive outreach through proselytizing by adherents of some more fundamental[ist] faiths" has no support in the information on which the Tribunal relied. The only evidence of activities with lower risk was in relation to "converts who go about their devotions quietly" and who "maintain a low profile". The idea of some lesser form of evangelism not amounting to proselytisation in the eyes of Iranian authorities was an assumption by the Tribunal. The Tribunal's distinction was directly in conflict with the evidence on which it relied that: "Any action interpreted as manifesting an intent to 'influence a Muslim to convert faith' is a serious criminal offence both for the priest and the Muslim concerned. Definition of this provision in the criminal code is moreover arbitrary and ambiguous. Its application is intended to harass." 18 Appellant S395/2002 (2003) 216 CLR 473 at 500 [78]. McHugh It is difficult, even linguistically, to distinguish between evangelism and proselytising. The Macquarie Dictionary defines "proselyte" as "one who has come over or changed from one opinion, religious belief, sect, or the like to another; a convert" and "proselytise" is the verb "to make a proselyte of; convert"19. To "evangelise" is, according to the same source, "to preach the gospel to" or "to convert to Christianity". "Evangelist", "evangelism" and other related words derive from the word "evangel" that refers to the teachings of and about Jesus Christ, primarily contained in the four gospels of the New Testament in the Christian Bible. So, any activity related to "evangel" is the preaching, sharing, telling or proclaiming of the Christian faith. In the context of a Muslim community, controlled by an Islamic regime and Muslim authorities, it is difficult to imagine how the Tribunal concluded that the appellant could operate as any kind of evangelist without this being perceived as an intention to "influence a Muslim to convert faith". But it is enough that the Tribunal had no basis in the "country information" or any other evidence before it for its assumption that a category of Christians who engaged in "quiet sharing of one's faith as an evangelist" either existed or was recognised by the authorities in Iran. The second part of the error by the Tribunal was in its application of the categorisation to the appellant, that is, the classification of the appellant by reference to the categories presumed. There are two problems with this aspect of the decision. The Tribunal came to unsubstantiated conclusions about the appellant's Christian beliefs and, by classifying the appellant according to its erroneous categories, failed to ask itself important questions about the appellant's chance of facing persecution in Iran. A number of the conclusions of the Tribunal were unsupported by evidence. The Tribunal referred to and relied on the identification of the denomination of Christianity to which the appellant belongs. The Tribunal said that it was not "a denomination that exhorts its adherents to proselytize". The Tribunal referred at this point to a letter from the appellant's spiritual adviser to the effect that the tenets of the Uniting Church were similar to those of the church in West Timor in which the appellant had been baptized. Insofar as Reverend Watts said anything in that letter about the content of the tenets of the faith that the appellant had embraced, he said: "As a natural consequence of the joy that he feels as a Christian, [the appellant] likes to be able to tell Muslim people he knows about Christianity particularly if they are showing an interest. He has told me he is doing this at Curtin IRPC. It seems that he cannot resist sharing his faith with others. I do not see this as a bad thing but rather that it is great because [the appellant] is merely living out the call of Christ to share the 19 The Macquarie Dictionary, 3rd ed (1997). McHugh good news with others. This is an essential part of being a Christian." (emphasis added) The Tribunal relied on no other evidence of the content of the appellant's faith. As Emmett J noted in his judicial review of the Tribunal's decision20: "It is true that the Tribunal did not inquire into the doctrines of the Uniting Church and specifically into the doctrines of the Uniting Church concerning evangelism. However, ... it is clear that the Tribunal took into account the Christian denomination that had been embraced by the applicant." The Tribunal also did not relate the appellant's denomination to the information it had extracted regarding Christian denominations in Iran21: "While the traditional Christian communities (Armenian and Assyrian) do not proselytise and even discourage those Muslims who may express an interest in conversion, the Catholic, Protestant and Evangelical missionary churches have tended to face greater problems with the authorities on account of their links with the West and the greater importance placed on proselytising." In some cases, a denominational distinction might be the kind of sub-category that could validly be employed in a case involving claimed persecution on religious grounds. In this case, however, the evidence before the Tribunal was that sharing the Christian faith with Muslims was an essential part of the kind of Christianity that the appellant had embraced. If any denominational classification were to be employed, the appellant was clearly a member of a church (Protestant) that was described as placing a greater importance on proselytising and for that reason faced greater difficulties from the Iranian authorities. The Tribunal's reliance on the appellant's denominational affiliation and presumed tenets of faith regarding proselytism had no evidentiary basis. The Tribunal also came to unsupportable conclusions about the appellant's level of activity in sharing his faith. Even on the Tribunal's categorisation, the weight of the evidence concerning the appellant suggested that he did engage in active proselytisation. The Tribunal accepted that the appellant might, on return to Iran, engage in "distribution of pamphlets, speaking to others privately about 20 NABD v Minister for Immigration and Multicultural Affairs (unreported, Federal Court of Australia, 26 March 2002) per Emmett J at [27]. 21 Commonwealth Department of Foreign Affairs and Trade, Country Profile for Use in Refugee Determination: Islamic Republic of Iran (1996). McHugh his faith and encouraging interested persons to attend church services". Unless the Tribunal, illogically, confined these acts to other Christians and defined proselytisation as conduct taking place only in prominent public places, it is unclear how it concluded that these acts in Iran would not amount to proselytisation. At the least, they proceeded well beyond what authorities might view as "influenc[ing] a Muslim to convert faith". An "interested person" would presumably be a person of another faith interested in Christianity. The evidence from Reverend Watts and the appellant, accepted by the Tribunal, was that the appellant was discussing his faith with Muslims in the detention centre. Although in my view the Tribunal erred in its conclusion on this issue, the error is probably one of fact rather than law. It is not necessary to hold that the Tribunal misdirected itself: I have already found that the Tribunal made a jurisdictional error in its approach to the appellant's application. Conclusion The focus on classifying the appellant according to his level of proselytisation led the Tribunal to fail to consider the appellant's individual circumstances as they related to the available information about the risk of persecution for Christians in Iran. The Tribunal did not consider whether, irrespective of its own assessment of the appellant's faith tenets, the appellant's anticipated conduct in Iran might give rise to a real chance of persecution even if it did not amount to proselytisation. In particular, the Tribunal did not address the qualifications present in the "country information" and the passage regarding behaviour perceived as influencing a Muslim to convert faith. The Migration Act requires that every applicant for a protection visa be assessed as an individual. Although in some contexts categorisation is an appropriate methodology for assessment, the categories applied in this case were not based on any evidence before the Tribunal and erroneously classified Christians in Iran by reference to behaviour that was not susceptible of categorisation. The Tribunal made a jurisdictional error when it confined its consideration of the appellant's risk of facing persecution in Iran to the determination of whether he was an "active proselytizing" or "quiet evangelising" Christian. Order The appeal should be allowed. The order of the Full Federal Court should be set aside. In its place, orders should be made allowing the appeal to that Court, granting the application for judicial review in the Federal Court and quashing the decision of the Refugee Review Tribunal, and directing the Tribunal to redetermine the appellant's application for a protection visa according to law. The first respondent should pay the appellant's costs in each Court and the Tribunal. Kirby KIRBY J. In Appellant S395/2002 v Minister for Immigration and Multicultural Affairs22, this Court drew attention to the error of dividing applicants claiming protection as refugees23 into a priori categories: those who, if returned to their country of nationality, might avoid persecution by acting "discreetly" and those who might not. The decision in that case concerned a claim for protection on the basis of a well-founded fear of being persecuted for reasons of membership of a particular social group (homosexuals from Bangladesh). The present is a case involving a claim of well-founded fear of persecution for reasons of religion (a Muslim convert to Christianity from Iran). The decision in Appellant S395 was given after the Full Court of the Federal Court of Australia determined the present case24. The central question in this appeal is whether the impermissibility of the taxonomy revealed in Appellant S395 requires the reversal of the decisions below and a reconsideration by the Refugee Review Tribunal ("the Tribunal"), freed from the postulate of the exercise of "discretion" – in this case identified as "the quiet sharing of one's faith as an evangelist [as distinct from] the aggressive outreach through proselytizing"25. Consistency with the approach adopted in Appellant S395 requires the same outcome. The Tribunal made an error of jurisdiction. That error should have been corrected by the Federal Court. This Court should require the reconsideration of the appellant's case, absent the arbitrary classification adopted. There is no postulate in the Refugees' Convention ("the Convention")26 that, in the exercise of the fundamental freedoms mentioned (including in respect of religion), applicants for protection must act "quietly", "maintain a low profile", 22 (2003) 216 CLR 473. 23 Migration Act 1958 (Cth), s 36. 24 Applicant NABD of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs [2002] FCAFC 249 (decided 22 August 2002). The decision in Appellant S395 was published on 9 December 2003. 25 Decision of the Refugee Review Tribunal, 19 December 2001 (G Brewer, Tribunal Member) ("Decision of the second Tribunal") at 15. 26 Convention relating to the Status of Refugees done at Geneva on 28 July 1951, [1954] Australian Treaty Series No 5; Protocol relating to the Status of Refugees done at New York on 31 January 1967, [1973] Australian Treaty Series No 37 (together described as "the Convention"). Kirby avoid proselytising their views or otherwise act "discreetly" in matters so fundamental27. The Tribunal misdirected itself by imposing this classification on the facts and by failing to consider whether, in Iran, the obligation to act in such a fashion would be the result of the denial of fundamental freedoms, thereby occasioning the "well-founded fear of being persecuted" referred to in the Convention and incorporated in the Migration Act 1958 (Cth) ("the Act"). There are further errors which I explain below. The result is that the appeal should be allowed. The facts and the appellant's case The background facts: A general description of the claim brought by NABD (the appellant) appears in the reasons of Hayne and Heydon JJ28 ("the joint reasons"). Some further elaboration appears in the reasons of Gleeson CJ29. However, I will add some more flesh to the bones. An appreciation of the detailed facts, and the applicable law, produce a different outcome. The appellant is a national of Iran who is now aged 36. He arrived in Australia in November 2000 after having spent seven months in Indonesia. He immediately applied for a protection visa. In January 2001 his application was refused by a delegate of the Minister. In April 2001 the Tribunal affirmed the delegate's decision. That decision was set aside by the Federal Court in June 2001. That Court concluded that the first Tribunal had30: "[F]ailed to interpret correctly the applicable law, in particular the elements implicit in the word 'religion', and its inter-relationship with the likely perceived results in the country of nationality upon return … [and to] apply this understanding of religion and its intersection with persecution to the facts as found." Specifically, the first Federal Court concluded that31: 27 Quoting from the decision of the second Tribunal at 15. 28 Joint reasons at [152]. 29 Reasons of Gleeson CJ at [4]-[6]. 30 [NABD] v Minister for Immigration and Multicultural Affairs [2001] FCA 795 at 31 [NABD] v Minister for Immigration and Multicultural Affairs [2001] FCA 795 at Kirby "[T]he Tribunal has not directed itself to the question as to whether the anticipated limits on the practice of the Christian faith of this applicant and the foresight of any such limitation did or did not amount to persecution or, more accurately, a well-founded fear of persecution." The Federal Court ordered the Tribunal to re-determine the appellant's claim. The Tribunal, differently constituted, reheard the application. In a decision of 19 December 2001, a second tribunal again reached a conclusion adverse to the appellant. It is that decision that is the subject of these proceedings. The appellant's case: In the second tribunal, in support of his claim of a well-founded fear of persecution for reasons of religion were he returned to Iran, the appellant relied upon a series of arguments advanced cumulatively and in the alternative: That he had identified with Christianity in Iran, narrowly escaped arrest before fleeing the country by mountain routes using a false passport, proceeding to Indonesia and ultimately to Australia so as to avoid the risks of persecution in Iran; That he had deepened his interest in Christianity whilst in Indonesia, had been baptised in West Timor and pursued his new religion on his arrival in Australia. Whilst in detention he had contributed to the conversion of more than twenty fellow detainees from Islam to Christianity32; That news of his departure, religious conversion and activities in the detention centre had come to the notice of his father and the authorities in Iran, resulting in his being disowned by the father and becoming of interest to the Iranian authorities; and That he had converted from Islam, the religion of his birth, to Christianity and, as the child of Muslim parents, was thus an apostate, liable under the Shari'a law applicable in Iran to the sentence of death for renouncing Islam; and otherwise to be subject to repressive and discriminatory controls in that country. Such restrictions extended to his exercise of his new-found religious belief, affecting in particular his entitlement to worship openly and without hindrance. They limited severely his ability to promote knowledge about Christianity amongst others, and to contribute to the conversion to Christianity of those who had not yet heard "the good news". 32 See Applicant NABD [2002] FCAFC 249 at [28]. Kirby The decisional history The Tribunal's adverse findings: It is proper to reduce this appeal to its essentials by noting determinations made by the second Tribunal that were arguably open to it on the evidence and that have not been substantially contested in this appeal. The second Tribunal disbelieved the appellant's contention that he had narrowly escaped arrest whilst attending a Christian meeting in Iran. It considered that he had "fabricated" this story, as well as the account of his disguised crossing into Turkey33. Similarly, the Tribunal rejected a letter, said to have come from the appellant's brother, which reported the antagonism of their father towards the appellant and the interest in him of the Iranian authorities34. In such matters, the second Tribunal stated that it had not found the appellant to be a "witness of truth"35. Whilst it accepted that the appellant had been baptised in Indonesia and had engaged in religious activities whilst in detention in Australia, the Tribunal also rejected his claim that, in Australia, he had caused the conversion to Christianity of twenty Islamic detainees. It reached this view having regard to the "strict limits of his inchoate knowledge of [Christianity]"36. These conclusions left open the issue of whether the appellant had himself "genuinely" converted to the Christian religion and what consequence upon the state of his "fear" that that act, without more, would have (if any) were he to be returned to Iran. The second Tribunal noted, in country information to which it referred, the provision of the death penalty in Iran, under one view of Shari'a law, for Muslim apostates. However, it appears to have concluded that such a penalty would not be imposed on the appellant or other persons who "worship privately and maintain a low profile"37. The second Tribunal suggested that it was "not inconsistent with his beliefs and practices" for the appellant, were he returned to Iran, to avoid proselytising the Christian religion or other active conduct that 33 Decision of the second Tribunal at 7-8. 34 Decision of the second Tribunal at 10. 35 Decision of the second Tribunal at 10. 36 Decision of the second Tribunal at 13. 37 Decision of the second Tribunal at 12, quoting from Australia, Department of Foreign Affairs and Trade, Country Profile for Use in Refugee Determination: Islamic Republic of Iran, (1996). Kirby would bring him to official notice38. On this basis, the second Tribunal was "not satisfied that the [appellant] is a person to whom Australia has protection obligations under the Refugees Convention"39. It therefore refused the protection visa that he sought. Decisions of the Federal Court: For a second time, the appellant brought proceedings in the Federal Court. On this occasion, the proceedings were commenced not under the Act for error of law40 (as had been done earlier), but under the Judiciary Act 1903 (Cth), s 39B. Essentially, the appellant's contention on this occasion was that the second Tribunal had failed properly to consider the application to his case of the essential requirements of s 36(2) of the Act so that the purported exercise of its statutory powers was invalid, and not a lawful exercise at all41. In so far as the appellant complained about the way in which the second Tribunal had addressed certain factual matters (notably its assumptions about the beliefs and "tenets" of the Uniting Church denomination of Christianity to which the appellant had become attached in Australia42), the appellant relied for this complaint on the law governing procedural unfairness43. He accepted that it was necessary for him to show jurisdictional error in order to obtain relief from the Federal Court44. It is appropriate to decide the appellant's case on that footing. If jurisdictional error is shown, the privative provisions of the Act would be inapplicable for the reasons explained by this Court in Plaintiff S157/2002 v The Commonwealth45. So much was not contested by the Minister. 38 Decision of the second Tribunal at 16. 39 Decision of the second Tribunal at 16. 40 See NABD v Minister for Immigration and Multicultural Affairs [2002] FCA 384 at 41 Minister for Immigration and Multicultural and Indigenous Affairs v SGLB (2004) 78 ALJR 992 at 1001 [51]; 207 ALR 12 at 24. 42 Decision of the second Tribunal at 15. 43 Dranichnikov v Minister for Immigration and Multicultural Affairs (2003) 77 ALJR 1088 at 1092 [24]-[25], 1101 [86]-[88]; 197 ALR 389 at 394, 406-407. 44 Minister for Immigration and Multicultural Affairs v Wang (2003) 77 ALJR 786 at 793 [37]; 196 ALR 385 at 394-395. 45 (2003) 211 CLR 476 at 494 [37]-[38], 510-511 [92]-[97]. Kirby I mean no disrespect to the judges of the Federal Court by not referring in detail to the reasons for their rejection of the appellant's application for relief. Because their decisions were given before the reasons of this Court in Plaintiff S157 were available, a significant part of the reasons, at first instance, was addressed to the privative provisions of the Act46. This is not now relevant. Further, because both decisions below were given before Appellant S395, they were not alert to the concerns about the classification relied upon under the Convention in terms of postulates of "discreet" and "non-discreet" conduct, were the appellant returned to his country of nationality. This being the case, it is necessary for this Court to reconsider for itself the decision of the Tribunal in order to decide whether it falls into an error analogous with that identified in Appellant S395. In my opinion it does. The applicable legislation There is nothing controversial about the legislation applicable to this case. Principally, it involves s 36(2) of the Act by which, effectively, the criteria stated in the Convention are accepted as part of Australian municipal law. Section 91R of the Act introduces an elaboration of the meaning of "persecution" in its application to claims by persons asserting that Australia has "protection obligations" under the Convention. Relevantly, it is necessary that the "persecution" involve "serious harm to the person" and "systematic and discriminatory conduct". In most circumstances, conduct engaged in by the person after arrival in Australia is to be disregarded47. It was common ground that s 91R was in force in relation to the appellant's claim. But it was equally agreed that it had no material application to his case. If the appellant could show that the Iranian legal and social sanctions against converts from Islam to Christianity would or might apply to him, there is no doubt that the harm to which he would or might be exposed was "serious harm" as defined by s 91R(2). The approach of the second Tribunal Religious freedom in Iran: relevant inhibitions: In order to identify the error of the second Tribunal, it is necessary to record additional passages from its 46 NABD [2002] FCA 384 at [19]-[38]. The Full Court did not consider that it needed to decide the question: [2002] FCAFC 249 at [39]. 47 The Act, s 91R(1), 91R(3). Kirby decision beyond those that appear in the majority reasons48. This is somewhat tedious. However, without a fuller appreciation of the reasoning of the Tribunal, its jurisdictional error is not revealed. The decision of the second Tribunal quoted documents supplied by the Australian Department of Foreign Affairs and Trade ("DFAT") as a country profile of Iran49 and by the United States Department of State Annual Report on International Religious Freedom for 1999: Iran50. The United States document records the fact that 99 percent of the population of Iran is Muslim. The Christian community constitutes only a portion of the remaining 1 percent, being approximately 117,000 persons in all according to Iranian figures. The United States report proceeds51: "The government is highly suspicious of any proselytizing of Muslims by non-Muslims and can be harsh in meting out its response, in particular against Baha'is and evangelical Christians." In the DFAT report, as quoted by the second Tribunal, it is stated52: "Apostasy is widely reported as carrying a nominal death sentence. However, there are only one or two cases (high profile Christian clergy) where this sentence has ever been imposed. Moreover, some senior and influential clerics have recently publicly questioned such an interpretation of Koranic law. The evidence is that those converts who go about their devotions quietly are generally not disturbed (it is either those who actively in conspicuous proselytization, who have run into difficulties, usually with the local mosque rather than the State authorities[)]. The last convert to be sentenced to death was Mehdi Dibaj, a high-profile Christian pastor with a long history of proselytization. He was given a last minute reprieve in early 1992 but found murdered a year later." seek attention, or who are engaged The DFAT report continues: 48 One passage appears in the reasons of Gleeson CJ at [9]. Other passages appear in the joint reasons at [155]-[156]. 49 Decision of the second Tribunal at 11-12. 50 Decision of the second Tribunal at 11. 51 Decision of the second Tribunal at 11. 52 Decision of the second Tribunal at 11-12. Kirby "Death sentences for apostasy have traditionally been issued to Baha'is and occasionally Christian converts who have been active in proselytising. However, the death sentence has rarely been carried out for apostasy alone. … People who do publicly convert away from Islam would … be harassed, possibly imprisoned and threatened with death, if they had been found to be active in proselytising among Muslims. … Those who worship privately and maintain a low profile will be very unlikely to suffer any adverse attention from the authorities for their conversion, unless they are involved in other activities which would attract security interest." In another passage of the DFAT report, reference is made to a legal prohibition on attempting to "influence a Muslim to convert faith" which is described as a "serious criminal offence" both for the Christian and Muslim concerned. The legal provision is described as "arbitrary and ambiguous". Its intention is said to be "to harass". Those working in government and harassment, revolutionary discrimination and possible dismissal if it becomes known that they have converted". "experience workplace organisations may The second Tribunal did not indicate any disbelief of these reports. It would have been astonishing if it had done so, given the unanimity with which, from different sources, the reports spoke of the lack of religious freedom in Iran. In his reasons in the Federal Court, reviewing the second Tribunal's decision, Emmett J quoted from a further document, reinforcing the foregoing reports. This was a background paper prepared by the United Nations High Commissioner for Refugees and published in January 200153. Describing the plight of Christians in Iran, that report states: "A Christian group reported that between 15 and 23 Iranian Christians disappeared between November 1997 and November 1998. Those who disappeared reportedly were Muslim converts to Christianity whose baptisms had been discovered by the authorities. The group reporting the disappearances believed that most of them were killed. In 1999 one organisation reported eight deaths of evangelical Christians at the hands of the authorities in the past 10 years." 53 [2002] FCA 384 at [30]. As Emmett J pointed out, this passage was quoted in the decision of the first Tribunal. It appeared in material that his Honour was prepared to accept was before, or available to, the second Tribunal. See also Boyle and Sheen, Freedom and Belief – A World Report, (1997); cf WAHI v Minister for Immigration and Multicultural and Indigenous Affairs [2003] FCA 908 at [14]. Kirby Read in the light of these apparently authentic and trustworthy descriptions of non-Muslim religious difficulties in Iran, any suggestion of a benign "tolerance" of Iranian converts to Christianity that might flow from the short extract from the country profile quoted in the joint reasons54 is dispelled. Iran is portrayed in the reports as a country with harsh laws and social practices, officially condoned, restricting the individual observance of religion that is permitted in most other countries55. Moreover, Iran is portrayed as a land given to disappearances, murders and reported murders of converts to Christianity, sharp intolerance, possessed of vaguely worded and ambiguous laws that are designed to prevent attempts (or what might be perceived or described as attempts) to convert members of the Muslim majority to Christian beliefs. It can be assumed that the appellant was aware of this situation, in his country of nationality, as described in the reports provided to the Tribunal by the Minister and apparently accepted by it. The conditions described must be kept in mind in judging whether the appellant had a "well-founded" fear of "persecution" for reasons of religion. Genuineness of conversion: Yet was the appellant a "genuine" convert to Christianity? Or was his conversion opportunistic, effected so as to secure a favourable outcome to his application for a protection visa in Australia56? Upon this subject, the second Tribunal's reasons were somewhat ambivalent and, with respect, rather ill-structured. On the one hand, the Tribunal noted that "the [appellant] is among 100 detainees in the same [detention] centre who have embraced Christianity in just eight months"57. Moreover, it gave weight to a report that described the economic downturn in Iran as the source of 54 Joint reasons at [154]. 55 See Sim, Fundamentalist World: The New Dark Age of Dogma, (2004) at 74-75. 56 The "genuineness" of a conversion could be relevant to assessing fear of persecution. It may provide evidence as to the likely behaviour of a person upon return to the country of origin. It should be noted, however, that there is no necessary link between genuineness and fear. An "opportunistic" conversion might still lead a Shari'a judge to view a person as an apostate. A person need not actually be or believe something for their fear of persecution to be well-founded. What is relevant is the perception of the alleged persecutor as to the nature of the belief of the asylum seeker. These perceptions, or whether the persecutor is aware of the belief of the asylum seeker, might be influenced by the genuineness of the conversion, in that it might affect that person's behaviour. 57 Decision of the second Tribunal at 13. Kirby "growing numbers of illegal Iranian immigrants"58. Yet each of these statements, which suggest a doubt on the Tribunal's part concerning the genuineness of the appellant's conversion from Islam to Christianity, appears after the Tribunal records its finding that his application was to be considered on the basis that his Thus, even in respect of the events that preceded the appellant's departure from Iran, the second Tribunal stated that it "accepts that the applicant befriended a Christian in Iran and that he occasionally discussed the Christian faith with him"60. It also accepted that, in Indonesia, he "might have been intimidated by some generalized violence against Christians … and by some personal harassment"61. Whilst finding that some of his claims were not genuine (such as the the appellant's brother) and expressing "serious reservations about his motivations", it stated quite clearly that it "accepts … that [the appellant] might have genuinely embraced Christianity over time"62; that he had been baptised in Indonesia; that he had undertaken Bible study courses by correspondence; and that he had attended religious gatherings in Indonesia and whilst in detention in Australia63. letter attributed to These conclusions led the Tribunal to accept that the appellant "has engaged in other religious activities as outlined by him at the hearing before this Tribunal" and that these included distribution of religious pamphlets, speaking to others privately about his faith and encouraging interested persons to attend church services64. Whilst raising again the question whether the appellant had converted "for convenience", the second Tribunal held back from making such a finding. On the contrary, it proceeded to assume that the appellant "has now done so", that is, embraced Christianity65. Upon that assumption – which cannot be questioned in this Court – the Tribunal then proceeded to consider the appellant's position, were he to return to Iran. 58 Decision of the second Tribunal at 14. 59 Decision of the second Tribunal at 12. 60 Decision of the second Tribunal at 7. 61 Decision of the second Tribunal at 9. 62 Decision of the second Tribunal at 10. 63 Decision of the second Tribunal at 10. 64 Decision of the second Tribunal at 11. 65 Decision of the second Tribunal at 12. Kirby It follows that this is not a case where the Tribunal dismissed the appellant's assertion of religious conversion to Christianity. On the contrary, the acceptance that an interest existed before he left Iran; that he was baptised in Indonesia; and that he had been engaged in Christian activities whilst in detention all indicate that the case was to be approached on the footing of a "genuine" religious conversion. This footing was reinforced by a letter provided to the Tribunal by Reverend Watts, the Uniting Church Minister serving the detention centre where the appellant was held. That letter is reproduced in the reasons of Emmett J66. There is no apparent reason to doubt the truthfulness of its contents: "[The appellant] likes to be able to tell Moslem people he knows about Christianity particularly if they are showing an interest. He has told me he is doing this at [the detention centre]. It seems he cannot resist sharing his faith with others. I do not see this as a bad thing but rather that it is great because [the appellant] is merely living out the call of Christ to share the good news with others. This is an essential part of being a Christian." To say the least, if the appellant were to return to Iran, and to continue such conduct, it would put him on a course of infraction of the laws of that country; specifically expose him to the risk of enlivening the apostasy law; render him vulnerable to complaint to authorities and intimidation for his religious beliefs by anyone with a grudge against him; and subject him to discriminatory practices of a kind unknown today in most countries, including Australia. The apostasy question: The second Tribunal acknowledged in its reasons the existence of the Iranian law against apostasy. It nowhere made a specific finding that the appellant was not exposed to punishment under that law. At the most, this was left to an inference, on the basis that the appellant would not be punished because of the prediction that he would quietly practise his faith and not proselytise67, taking care to "maintain a low profile". That there is a sentence of death attaching to apostasy; that the appellant, on being returned to Iran as someone who has converted to Christianity, would be exposed to that penalty; and that (although rarely carried out) converts had been murdered, had disappeared and had been harassed, in combination, called for a specific conclusion as to whether the crime of apostasy was a real risk so far as the appellant was concerned. No such finding was made. 66 [2002] FCA 384 at [13]. 67 Decision of the second Tribunal at 15. Kirby long been abolished The death penalty has in every Australian jurisdiction68. Enlightened belief in Australia finds that form of punishment abhorrent. Australia is a party to the International Covenant on Civil and Political Rights ("ICCPR")69. The Second Optional Protocol to the ICCPR70 aims at the abolition of the death penalty throughout the world. It commits State Parties to abolish that punishment within their own jurisdiction. The principle adopted in Art 1.1 of the Second Optional Protocol is mirrored in the requirement of the Extradition Act 1988 (Cth) governing the extradition of persons by Australia to countries that maintain the death penalty71. It necessitates the provision of an undertaking to Australia that a person so extradited will not be subject to the death penalty or, if so subject, that the penalty will not be carried out. Without the provision of that undertaking the person – citizen or non-citizen – will not be extradited. Where the Federal Parliament has spoken so clearly on this topic and the Executive Government on behalf of Australia has adhered to the Second Optional Protocol, the Tribunal and the courts of Australia should approach the meaning and application of the Act in ways that are consonant72. It is far from clear that the Tribunal and the Federal Court addressed themselves directly to the appellant's fear about the risk of the imposition of the death penalty, now or in the future, as it might be faced by him were he returned to Iran. That risk would need to be judged by reference not only to current political and religious conditions in Iran but also to possible future conditions. Those conditions might change; not necessarily for the better. These questions were not considered explicitly by the second Tribunal, although clearly raised by the appellant's reference to the dangers of return to Iran for an apostate Muslim like himself. They are crucial in judging whether his "fear" of persecution is "well-founded". 68 Kirby, "The High Court and the death penalty: Looking back, looking forward, looking around", (2003) 77 Australian Law Journal 811 at 817-819. 69 Done at New York on 19 December 1966, [1980] Australian Treaty Series No 23. 70 Done at New York on 15 December 1989, [1991] Australian Treaty Series No 19 ("Second Optional Protocol"). 71 Extradition Act 1988 (Cth), s 22(3)(c). 72 cf Mohamed v President of the Republic of South Africa 2001 (3) SA 893 (CC). Kirby I also agree with the Federal Court of Australia in SGKB v Minister for Immigration and Multicultural and Indigenous Affairs73 that the Tribunal: "... ought to have considered whether or not the mere possibility of a death sentence, regardless of how remote that possibility might be, could itself constitute persecution. In our view, to live under the shadow of such a threat might well do so." The comments of French J in another Federal Court case are equally "The Tribunal found that there was no evidence of low profile apostates attracting persecution of any kind in Iran. The evidence before it however indicates that the death penalty may be inflicted on apostates. When the Tribunal found that there was no evidence of low profile apostates attracting persecution it is not clear that this finding extended to apostates who are known to the authorities. It may be that there is no evidence of low profile apostates attracting persecution because they are not known to be such." Tenets of the Christian religion: In the Federal Court and in this Court, the appellant also complained of the reliance by the Tribunal on assumptions it had made concerning the tenets of the Christian Church with which he had become involved in Indonesia and whilst in detention in Australia. On this, the Tribunal expressed its own view, presumably on the basis of its knowledge of, or perceptions about, the Uniting Church in Australia. The Tribunal accepted specific evidence the appellant "discussed Christianity with other detainees"75, distributed pamphlets and encouraged others to attend church76. that In the reasons of the second Tribunal, it was said77: "In reaching its findings, the Tribunal also gives weight to the fact that the [appellant] is not a member of a denomination that exhorts its adherents to proselytize. A letter from his spiritual adviser indicates that the church the 73 [2003] FCAFC 44 at [21]. 74 WAHI [2003] FCA 908 at [38]. 75 Decision of the second Tribunal at 13. 76 Decision of the second Tribunal at 11. 77 Decision of the second Tribunal at 15-16. Kirby [appellant] attended in Indonesia has similar tenets to the Uniting Church denomination to which he has become attached in Australia. A distinction can be drawn between the quiet sharing of one's faith as an evangelist and the aggressive outreach through proselytizing by adherents of some more fundamental faiths. … [C]ountry information indicates that the actual capacity of the [appellant] to practise his faith in Iran without a well-founded fear of persecution for a Convention reason is consistent both with his Christian teachings in Australia and, similarly, in Indonesia. A requirement to proselytize is not a core component of his faith nor, indeed, at all essential to it." The appellant submitted that this finding, made without specific evidence, involved a procedural unfairness to him. In so far as there was evidence at all on this issue, it was contained in the statement by Reverend Watts that telling other people, specifically Muslim people, about Christian beliefs was "living out the call of Christ to share the good news with others" and "an essential part of being a Christian". It might be true that, in Australia, the Uniting Church does not ordinarily proselytise "aggressively". However, a person who has converted to Christianity, as the appellant was accepted to have done, living in a country overwhelmingly constituted of adherents to a different religion, might feel a greater desire to tell others about his new beliefs. So it certainly was historically in Australia, as in England, in the case of the Protestant denominations which, in 1977, combined in the Uniting Church in Australia. The second Tribunal appears78 to have believed that it could draw the inference which it did on the basis of its own general knowledge rather than proof or, at least, by putting the issue to the appellant so that he could respond to it according to his own beliefs. Once again, this appears to be the type of error exposed in Appellant S395. Instead of concentrating on the appellant's fears and prospective conduct, the Tribunal superimposed an a priori classification derived from its own conceptions of the usual practices of the Christian denomination which the appellant had embraced. Remarkably, it then transferred Australian norms and conduct to the completely different circumstances of the appellant in Iran. This is the kind of error into which this type of classification easily leads the decision-maker. Quiet sharing of Christian faith: Whatever the defects and errors in the foregoing reasoning, I now reach the critical parts of the second Tribunal's decision where its ultimate conclusion was stated. 78 Decision of the second Tribunal at 13. Kirby Influenced by the taxonomy reflected in the DFAT country information, the second Tribunal arrived at the conclusion stated in other reasons79. However, it is very important to note that such conclusion followed a recognition by the Tribunal of the classification adopted in the DFAT materials80: "Information from DFAT indicates that converts who go about their devotions quietly are not bothered; it is only those who actively seek public attention through conspicuous proselytizing who encounter a real chance of persecution." It is therefore against the background of this classification that the Tribunal expressed its opinion that the appellant "would not choose to generally broadcast his practice of Christianity or conspicuously proselytize in Iran"81. Yet this "choice" is given meaning by reference to the peril that the appellant would face were he to "choose" any other course82: "If he were to choose to practise Christianity in Iran and to quietly spread the word the Tribunal concludes there is not a real chance that he would face persecution as a consequence." Viewed in context, the prediction of what would occur is obviously based on the immediately preceding acknowledgment that any hope that a convert to Christianity in Iran would be let alone is dependent on a willingness to proceed "quietly" and to avoid risks of "public attention". The contrary course spells very serious dangers. That this was the dichotomy accepted by the second Tribunal can be seen in several passages in the closing pages of its reasons83: "According to DFAT, Iranian converts to Christianity who go about their devotions quietly and maintain a low profile are generally not disturbed … provided they do not seek to convert others or engage in high profile religious activities." 79 Reasons of Gleeson CJ at [9]; joint reasons at [155]. 80 Decision of the second Tribunal at 13. 81 Decision of the second Tribunal at 13. 82 Decision of the second Tribunal at 13. 83 Decision of the second Tribunal at 15. Kirby And: "A distinction can be drawn between the quiet sharing of one's faith as an evangelist and the aggressive outreach through proselytizing by adherents of some more fundamental faiths." Having accepted that a "quiet" (equivalent to "discreet") practice of religious beliefs was imperative for safety in Iran, the second Tribunal effectively imposed the requirement of "quiet sharing of one's faith" on the appellant, were he to be returned to Iran. Its prediction of what he would do was necessarily dependent upon its assessment of what alone it would be safe for him to do in Iran. The issue for this Court is whether the approach so described constitutes jurisdictional error. Does it involve the Tribunal, as in Appellant S395, in focussing incorrectly upon a classification derived from the practices of the country of nationality? Does this approach divert the Tribunal from addressing itself, as the Act and the Convention require, to whether, in his circumstances, the appellant has sufficiently established a relevant "fear" of persecution "for reasons of … religion". And if he did, whether such fear was "well-founded" in all of the circumstances of the case? The Convention and the ground of religion The Convention in context: The Convention is part of the international law that upholds basic human rights. The Preamble to the Convention recites the Charter of the United Nations and the Universal Declaration of Human Rights ("UDHR") as each affirming "the principle that human beings shall enjoy fundamental rights and freedoms without discrimination"84. The Preamble also recites the United Nations' "profound concern for refugees" and its endeavours "to assure refugees the widest possible exercise of these fundamental rights and freedoms"85. This is why the Convention has been recognised in Australia86, the United Kingdom87 and elsewhere as an instrument embodying principles for the protection of basic human rights. This Court should interpret the Convention accordingly. 84 Convention, Preamble, par 1. 85 Convention, Preamble, par 2. 86 Applicant A v Minister for Immigration and Ethnic Affairs (1997) 190 CLR 225 at 87 R v Immigration Appeal Tribunal; Ex parte Shah [1999] 2 AC 629 at 639 per Lord Steyn. Kirby From this premise, it has been said, correctly in my view, that if a State is "unable or unwilling to afford one of its own citizens his or her human rights as set forth in the UDHR, refugee and asylum law should recognize that individual's right to asylum in a state that will uphold those rights"88. Thus, the Convention is a practical means of "providing tangible redress from certain basic human rights violations", making it amongst "the foremost international human rights instruments"89. The ambit of "persecution" within the Convention remains the subject of debate. However, the term can be described as including the "sustained or systemic violation of basic human rights demonstrative of a failure of state protection"90. The link to international human rights law is important because "it attaches refugee protection to the denial of core human rights and thus forges a close connection to other human rights instruments"91. Religion as a human right: This context also assists in understanding the reference to "religion" in the definition of "refugee" in the Convention, with its express mention of "well-founded fear of being persecuted for reasons of … religion". In practice, it is a ground that has had less attention than others; but that neglect is now being repaired92. Reading the Convention in the context of international human rights law, specifically as that law defends freedom of religion, helps to demonstrate why the imposition of a requirement that a person must be "discreet", "quiet", "low profile" and not "conspicuous" is incompatible with the objects of the 88 Parish, "Redefining the Refugee: The Universal Declaration of Human Rights as a Basis for Refugee Protection", (2000) 22 Cardozo Law Review 223 at 258. 89 Steinbock, "Interpreting the Refugee Definition", (1998) 45 UCLA Law Review 733 at 736. See also Hall, "Quixotic Attempt? The Ninth Circuit, the BIA, and the Search for a Human Rights Framework to Asylum Law", (1998) 73 Washington Law Review 105; Hathaway, "A Reconsideration of the Underlying Premise of Refugee Law", (1990) 31 Harvard International Law Journal 129 at 131-132. 90 Harvey, "The Right to Seek Asylum in the European Union", (2004) 1 European Human Rights Law Review 17 at 20, citing Hathaway, The Law of Refugee Status, 91 Harvey, "The Right to Seek Asylum in the European Union", (2004) 1 European Human Rights Law Review 17 at 21. 92 Musalo, "Claims for Protection Based on Religion or Belief", (2004) 16 International Journal of Refugee Law 165 at 169. Kirby Convention, properly understood. True, the human rights of the applicant for protection must be accommodated to the human rights of other individuals, both in the country of nationality and in the country in which protection is sought. Violent, aggressive or persistently unconsensual conduct "for reasons of … religion" are not protected by the Convention, any more than by other instruments of international law. Yet neither is it an answer to an assertion of a "fear" of being "persecuted for reasons of … religion" that such "fear" is not "well-founded" because it can be avoided by the behavioural expedients of discretion, quietness, maintaining a "low profile" and so forth. Such an approach is incompatible with the inclusion of religious freedom in the Convention. "Religion", in that context, connotes not simply a private belief, or lack of belief, kept secret involves manifestations, and the practice of such a belief, including where relevant in community with others93. So much follows from nothing more than the use in the Convention of the word "religion". the person concerned. Necessarily, This conclusion is reinforced by the developments of international law respecting freedom of religion as a basic human right94. Thus, Art 18 of the UDHR provides that: "Everyone has the right to freedom of thought, conscience and religion; this right includes freedom to change his religion or belief, and freedom, either alone or in community with others and in public or private, to manifest his religion or belief in teaching, practice, worship and observance." Article 18 of the ICCPR is in similar terms, making it clear that the right there expressed is subject "only to such limitations as are prescribed by law and are necessary to protect public safety, order, health, or morals or the fundamental rights and freedoms of others"95. In a General Comment on Art 18 of the ICCPR96, the United Nations Human Rights Committee adopts a wide interpretation of the right of the individual to manifest his or her religion. Such manifestation extends to worship; 93 Wang v Minister for Immigration and Multicultural Affairs (2000) 105 FCR 548 at 94 Anker, Law of Asylum in the United States, 3rd ed (1999) at 403-404. 95 ICCPR, Art 18.3. 96 United Nations, Human Rights Committee, General Comment No 22: The Right to Freedom of Thought, Conscience and Religion (Art 18), (1993) at [4]. Kirby ritual and ceremonial acts; customs; the wearing of distinctive clothing; use of particular languages; choice of leaders; establishment of schools; and "the freedom to prepare and distribute religious texts or publications". In the General Comment, the display of symbols, the conduct of public worship and other observances are included in the concept of "religion". The situation of religious minorities in Iran, as described in the uncontested country descriptions before the second Tribunal, fall far short of this elaboration of the activities inherent in freedom of religion as understood in international human rights law. The general statements in the UDHR and ICCPR have been further elaborated, relevantly, by the Declaration on the Elimination of All Forms of Intolerance and of Discrimination Based on Religion or Belief proclaimed by the General Assembly of the United Nations in 198197. This Declaration states that the "freedom of thought, conscience and religion" includes the manifestation of a religion or belief in "worship, observance, practice and teaching"98. It includes, relevantly, freedom to "worship or assemble"; to "write, issue and disseminate relevant publications"; to "teach a religion or belief in places suitable for these purposes"; and to "establish and maintain communications with individuals and communities in matters of religion or belief at the national and international levels"99. There are similar elaborations of the freedoms inherent in manifesting one's religion or beliefs in regional human rights instruments100. The law, social practices and attitudes to the manifestation of minority religious beliefs in Iran, as described in the uncontested record, seriously conflict with these virtually universal statements of what is involved when international instruments, such as the Convention, refer to the protection of individual rights with respect to "religion". The connection between the reference in the Convention to "religion" and this body of international law is acknowledged in the Handbook on Procedures 97 United Nations, General Assembly Resolution 36/55 (25 November 1981). 98 Art 1.1. 99 Art 6(a), (d), (e), (i). 100 See European Convention for the Protection of Human Rights and Fundamental Freedoms (1950), Art 9.2; American Declaration of the Rights and Duties of Man (1948), Art III; American Convention on Human Rights (1969), Art 12; Arab Charter on Human Rights (1994), Art 27; African Charter on Human and Peoples' Rights (1981), Art 8; Lester and Pannick, Human Rights Law and Practice, 2nd ed (2004) at 324-334 [4.9.3]-[4.9.14]; R (Pretty) v Director of Public Prosecutions [2002] 1 AC 800 at 824 [31]. Kirby and Criteria for Determining Refugee Status, issued by the United Nations High Commissioner for Refugees101. According to that Handbook, a prohibition on religious worship in private or in public and "serious measures of discrimination" imposed on religious grounds enliven the operation of the Convention. It is now well established that the Convention "protects not only religious beliefs, but also religious manifestations"102. What is at stake is not simply the defence of private thoughts and opinions. Of their nature, such internal processes can usually be maintained whatever the oppressive efforts of State power. International instruments, such as the Convention, are concerned with protecting the individual's public activities in interaction with others. This includes being open about one's religion and discussing it freely with others whilst at the same time respecting the rights of others to adhere to a different religion or no religion at all. The foregoing approach to the Convention is further confirmed by decisions of the European Court of Human Rights in elaboration of Art 9 of the European Convention for the Protection of Human Rights and Fundamental Freedoms103. In Kokkinakis v Greece104, that Court affirmed that religious freedom includes the freedom: "[T]o manifest one's religion … not only exercisable in community with others, 'in public' and within the circle of those whose faith one shares, but can also be asserted 'alone' and 'in private'; furthermore, it includes in principle the right to try to convince one's neighbour ... through 'teaching', failing which … 'freedom to change [one's] religion or belief' … would be likely to remain a dead-letter." Similarly, in Metropolitan Church of Bessarabia v Moldova105, the same Court insisted on the right of those of a particular belief to be allowed to "associate freely, without arbitrary interference by the State". This, it was held, was "indispensable to pluralism … and is therefore at the very heart of the protection". Mere "tolerance", in the sense of ignoring a minority religious belief 101 (1992) at [71]-[72]; Vevstad, Refugee Protection – A European Challenge, (1998) 102 Johnson, "Religious Persecution: A Viable Basis for Seeking Refugee Status in the United States?", (1996) Brigham Young University Law Review 757 at 764. 103 See Lester and Pannick, Human Rights Law and Practice, 2nd ed (2004) at 323- 104 (1993) 17 EHRR 397 at 418. 105 (2002) 35 EHRR 13 at [118]. Kirby whilst confirming legal and State protection for others, was said to be no substitute for "recognition", since only recognition is capable of conferring enforceable rights on those concerned106. The idea that individuals have rights to religious freedom, and to change or abandon an earlier religion or religion in general, is thus one that lies at the heart of the word "religion" appearing in the Convention. It does not give religious adherents a carte blanche in the manifestation of their beliefs and the practice of their religion. The assertion of their rights must be respectful of the rights of others. However, the picture of religious intolerance, and the limitations (legal and otherwise) imposed on Christian believers in Iran, especially Muslim converts to Christianity, falls far short of the notion of religious freedom expressed in international law107, to which the Convention is intended to contribute. Postulate of "quiet exercise of faith": Against this understanding of the purpose and content of the reference to "religion" in the Convention, it remains to consider the approach of judicial and other authorities to the suggestion that a "fear" of persecution for reasons of religion will not be "well-founded" if it can be avoided in the country of nationality by the exercise of "discretion" on the part of the putative refugee. Generally speaking, scholars and courts that have considered the identified grounds in the Convention have rejected the notion that such is the content of the freedoms referred to there108. Their rejection is explained by reference to the fact that, were it otherwise, the Convention would itself become an instrument to diminish, instead of to protect and enhance, the nominated freedoms. Courts, tribunals and other decision-makers in countries of refuge would become, effectively, enforcers for those who diminish the identified freedoms instead of the protectors of those who claim that their freedoms are at risk109. 106 (2002) 35 EHRR 13 at [129]. 107 See also Murphy v Ireland [2003] ECHR 352 (10 July 2003) at [65]. 108 See Hathaway, "The Michigan Guidelines on Nexus to a Convention Ground", (2002) 23 Michigan Journal of International Law 211 at 213. 109 Dauvergne and Millbank, "Before the High Court: Applicants S396/2002 and S395/2002, a gay refugee couple from Bangladesh", (2003) 25 Sydney Law Review 97 at 110; Millbank, "Imagining Otherness: Refugee Claims on the Basis of Sexuality in Canada and Australia", (2002) 26 Melbourne University Law Review 144 at 176-177; Kendall, "Lesbian and Gay Refugees in Australia: Now that 'Acting Discreetly' is no Longer an Option, will Equality be Forthcoming?", (2003) 15 International Journal of Refugee Law 715. Kirby In Fosu v Canada (Minister for Employment and Immigration)110 an applicant for refugee status complained of being arrested by authorities in Ghana under a law that prohibited public manifestations of the beliefs of Jehovah's Witnesses. Responding to the decision of the refugee tribunal in Canada that the applicant could pray to God and study the Bible in Ghana, Denault J stated that this was an "unduly limited" conception of the practice of "religion" protected by the Convention111: "The fact is that the right to freedom of religion also includes the freedom to demonstrate one's religion or belief in public or in private by teaching, practice, worship and the performance of rites. As a corollary to this statement, it seems that persecution of the practice of religion can take various forms, such as a prohibition on worshipping in public or private, giving or receiving religious instruction or the implementation of serious discriminatory policies against persons on account of the practice of their religion." Similar conclusions have been reached in Canada in other cases where the Canadian tribunal had applied an approach postulating that the applicant could avoid persecution by concealment and discretion112. In Irripugge v Canada (Minister of Citizenship and Immigration)113, the Federal Court of Canada reversed a refugee tribunal finding that the claimant was not persecuted for practising his religion as a Roman Catholic Christian in China because he could continue to do so in secret and thus avoid coming to the attention of State authorities. Sharlow J found that such an approach to persecution was erroneous, and affirmed the finding in Fosu that being forced to worship in private can amount to "persecution"114. Why should this Court endorse for Australia a narrower and less freedom-respecting view of the content of the Convention? In Australia, individual judges of the Federal Court have adopted an approach similar to the Canadian courts. Thus in Woudneh v Inder115, Gray J, in 110 (1994) 90 FTR 182. 111 (1994) 90 FTR 182 at [5]. 112 Husseini v Minister of Citizenship and Immigration [2002] FCT 177; Sadeghi- Pari v Canada [2004] FCT 282 at [29]. 113 (2000) 182 FTR 47. 114 See also von Sternberg, The Grounds of Refugee Protection in the Context of International Human Rights and Humanitarian Law, (2002) at 31. 115 Unreported, Federal Court of Australia, 16 September 1988 at 19. Kirby the context of the exercise of religion concluded that the "mere fact of the necessity to conceal would amount to support for the proposition that the applicant had a well-founded fear of persecution on religious grounds". There are similar decisions of other judges116. In respect of freedom from political persecution of a political dissenter, also envisaged in the Convention, Madgwick J, in Win v Minister for Immigration and Multicultural Affairs117, expressed the point succinctly in words that I would endorse: "[U]pon the approach suggested by [the Minister], Anne Frank, terrified as a Jew and hiding for her life in Nazi-occupied Holland, would not be a refugee: if the Tribunal were satisfied that the possibility of her being discovered by the authorities was remote, she would be sent back to live in the attic. It is inconceivable that the framers of the Convention ever did have, or should be imputed to have had, such a result in contemplation." The courts in the United States of America have adopted a similar approach to claims of fear of religious persecution where the relevant tribunal has found such a fear inapplicable to a person who keeps a "low profile". In Bastanipour v Immigration and Naturalization Service118, Judge Posner, in the Court of Appeals (7th Circuit), dealing with a case of an Iranian convert to Christianity, rejected the suggestion that the petitioner in that case could conceal his religion and be thereupon free from fear of persecution: "If [the petitioner] has converted to Christianity he is guilty of a capital offense under Iranian law. No doubt there are people walking around today in Iran, as in every other country, who have committed a capital offense but have managed to avoid any punishment for it at all. [The petitioner] might be one of these lucky ones. But his fear that he will not be is well founded." The United States courts have emphasised the importance for religious freedom of the entitlement to practise the religion openly119. In Bucur v Immigration and Naturalization Service120, the Court of Appeals (7th Circuit) 116 eg Minister for Immigration and Multicultural Affairs v Zheng [2000] FCA 50 at [41] per Hill J, [57] per Carr J. 117 [2001] FCA 132 at [18]. See also Omar v Minister for Immigration and Multicultural Affairs (2000) 104 FCR 187 at 200 [42]. 118 980 F 2d 1129 at 1133 (7th Cir, 1992). 119 Najafi v Immigration and Naturalization Service 104 F 3d 943 at 949 (7th Cir, 120 109 F 3d 399 at 405 (7th Cir, 1997). Kirby observed that an essential feature of religious "persecution" is the attempt it involves to preclude those who espouse a particular religion from practising it openly. Doing so challenges the power of those who wish to preserve their own dominance, or the dominance of their ideas, which will only give way to the diversity inherent in freedom when those ideas are publicly perceived to be subject to differing ideas, beliefs and conduct121. According to this view, to reinforce in any way the oppressive denial of public religious practices (or any other feature of freedom essential to human rights) is to participate in the violation of the purposes that the Convention is intended to uphold122. It is to disempower the freedom of the individual who applies for protection by demanding that he or she acquiesce in "discreet" conduct ("the quiet sharing of one's faith"). That is not what the reference to "religion" in the Convention is designed to defend. It would be to diminish the capacity of the Convention to protect individuals from abusive national authority to force them, in the respects identified in the Convention, to survive by the concealment of the fundamental freedoms that the Convention mentions123. Moreover, effectively, it would place an onus on the victim to justify a demand for a basic freedom rather than to require the putative persecutor who, contrary to the international law of human rights demands that the victim "maintain a low profile"124, to justify such abusive conduct. In the South African Constitutional Court125, Sachs J has explained with great clarity how a well-established means to prevent the attainment of fundamental human rights is to pressure the oppressed to be invisible, so that they continue to be regarded as shameful, powerless, exceptional and dangerous to the majority. No Australian tribunal or court has the authority or power directly to inflict such a wrong on a national of another country. Nor should it do so indirectly by imposing such a test for the determination of whether a claimed "fear of persecution" is unfounded, because it could be avoided by subscribing to 121 See Kendall, (2003) 15 International Journal of Refugee Law 715 at 738, 748. 122 See Kendall, (2003) 15 International Journal of Refugee Law 715 at 740. 123 See Kendall, (2003) 15 International Journal of Refugee Law 715 at 739. 124 Decision of the second Tribunal at 15. 125 The National Coalition for Gay and Lesbian Equality v The Minister of Justice (1999) (1) SALR 6 (CC) at [110], [126]. See Kendall, (2003) 15 International Journal of Refugee Law 715 at 736-737. Kirby the oppression that diminishes one of the individual's core freedoms. I agree with Mahoney JA of the Canadian Federal Court of Appeals that126: "A person successfully hiding from his persecutor can scarcely be said to be experiencing no problems. Such a finding is perverse." Conclusion: jurisdictional error is shown Three arguable errors of jurisdiction: There are three preliminary errors in the reasoning of the second Tribunal which suggest that it failed to address itself to the correct legal question or did so in a way that involved procedural unfairness to the appellant. First, its failure to address specifically the appellant's complaint that, as an apostate Muslim, he was liable in Iran, upon prosecution, to the death penalty and thus rendered vulnerable to any enemies or critics of his religious conversion (or other activities). This aspect of his claim was not explicitly decided. It appears simply to have been assumed that he would fall outside the class of Christian converts who, according to the uncontested country information, are murdered or disappear in Iran. This, in my view, was jurisdictional error127. Where there is any risk of death or disappearance, assumption is not good enough. Express findings must be made. Secondly, the Tribunal did not consider the possibility that the situation in Iran might change for the worse for converts. Self-evidently, Iran and its region are volatile, not static. As they have demonstrated, religious forces are capable of asserting themselves. At least arguably, the Shari'a law presents risks to apostates in Iran that cannot be treated as trivial unless a firm conclusion is reached that the "conversion" was opportunistic and would be safely shed upon return, and that in Iran, such a "conversion" would not become known at all and so result in no well-founded fear of persecution. No such conclusion was made in the appellant's case. In reviewing a claim based on apostasy, the Court of Appeals (7th Circuit) has stated that the formalities of conversion and even the sincerity of beliefs is not what is ultimately critical, but rather "what would count 126 Sabaratnam, Thavakaran v Minister for Employment and Immigration, Federal Court of Appeals (Canada) No A-536-90, 2 October 1992, at 2 per Mahoney JA, cited in Kendall, (2003) 15 International Journal of Refugee Law 715 at 739-740. 127 See SGKB v Minister for Immigration and Multicultural and Indigenous Affairs [2003] FCAFC 44 (special leave to appeal refused 14 August 2003: [2003] HCATrans 313); WAHI [2003] FCA 908 at [37]; VFAC v Minister for Immigration and Multicultural and Indigenous Affairs [2004] FCA 367 at [36]; Anker, Law of Asylum in the United States, 3rd ed (1999) at 403-404. Kirby as conversion in the eyes of an Iranian religious judge"128. In the appellant's case, the Tribunal held back from making the necessary findings. It gave the appellant the benefit of the doubt as to his conversion: a course supported by the evidence. It did not address the resulting issue of the fear of the appellant in Australia having regard to the possible reactions of officials in Iran. Thirdly, there is the appellant's complaint of imputing to an adherent to the Uniting Church, tenets of his religion that appear contrary to the evidence of its Minister about the Christian duty to share the message of Jesus with those presently outside his religion. I will set these three errors to one side. I can adopt this course because the outcome in this case, in my view, is clearly governed by the error of the second Tribunal in its approach to the suggestion that the appellant's fear of persecution was not "well-founded" because he could, and would, avoid that outcome by following "the quiet sharing of [his faith]", if returned to Iran and by refraining from what authorities there might regard as "the aggressive outreach through proselytizing". The error of postulating self-censorship: The fundamental error of the second Tribunal in this case is similar to that identified by this Court in Appellant S395. It lay in the second Tribunal's conclusion that "a distinction can be drawn" between "the quiet sharing of one's faith" and aggressive proselytising and in its stated belief that, if returned to Iran, the appellant would adhere to the former classification and avoid the latter, not because of fear of persecution by the Iranian authorities but because that was the kind of Christianity he had accepted. The inter-connectedness of the taxonomy applied by the second Tribunal and its prediction of how the appellant would conduct himself if returned to Iran are critical. Without the a priori classification ("quiet sharing of one's faith" against "aggressive outreach through proselytizing"129), the second Tribunal would not have asked, and decided, the second question of what the appellant would do if returned to Iran. Thus, the classification of "discreet" conduct was accepted, although this is erroneous as this Court later demonstrated in Appellant S395. The classification has no foundation in the Convention. It is destructive of the achievement of the Convention's purpose to uphold a fundamental human right. It diverts attention from the real question posed by the Act, and the Convention, namely whether there is a fear of persecution in the applicant for a Convention reason and whether that fear is "well-founded" in all of the circumstances. 128 Bastanipour 980 F 2d 1129 at 1132 (7th Cir, 1992). 129 Decision of the second Tribunal at 15. Kirby Yet can it be said (as the majority in this Court holds) that the identified classification is ultimately immaterial, so that the real issue depends on the factual finding made by the Tribunal as to how this particular appellant would "choose to" conduct his religion if he were returned to Iran, as a Christian convert130? The joint reasons conclude that it is possible to divorce the uncontested oppressive features of the Iranian State in the matter of religion from the prediction of how the appellant himself would feel about possible persecution in Iran and how he would behave, as an apostate, if returned to that country. With all respect, this approach involves a feat of unrealistic mental gymnastics. The notion that the appellant, upon return to Iran, would act discreetly, keep a "low profile", avoid "aggressive outreach" and "quietly share his faith" might be uncontestable in this Court. However, the idea that he would do so because of his personal "choice"; the tenets of the Uniting Church in Australia; or the pattern of his conduct whilst in the artificial circumstances of immigration detention in this country is fanciful. With the law of apostasy hanging over him, and the chance of murder or disappearance in prospect now, or in unstable conditions in the future, the risk of his freely practising his religion as he chooses would be minuscule. But that was not the question that the Tribunal was required to address. That question, which it failed to consider in the correct way, was whether the appellant's propounded fear was "well-founded", given the uncontested evidence that the Tribunal received of the situation of conversion in Iran. The Tribunal is not entirely at fault in the approach which it took and the conclusion that it reached. The supposed a priori classification that it endorsed was adopted without the benefit of this Court's decision in Appellant S395. Moreover, it was encouraged by some of the language of the DFAT country profile (although not, it should be said, repeated in the United States material or in that of the High Commissioner for Refugees). Following the decision in Appellant S395, it is necessary to rid this area of decisional discourse of the supposed dichotomy between applicants for protection visas who might be able to avoid or diminish the risks of persecution by conducting themselves "discreetly" in denial of their fundamental human rights and those who assert those rights or who might deliberately or even accidentally manifest them, or be thought or alleged to have done so. The most effective way that this Court can ensure that this untextual, irrelevant and undesirable dichotomy is deleted from refugee decisions in Australia is by the insistence that, where it surfaces, the outcome is set aside and the matter remitted for reconsideration, freed from such error. 130 Reasons of Gleeson CJ at [10]; joint reasons at [166]. Kirby In the present case, the classification is patent on the face of the second Tribunal's reasons. It thus invites the application of the principle upheld by this Court in Appellant S395. The suggestion that, although repeatedly mentioned by it, the dichotomy did not affect the second Tribunal's fact-finding about the likely response of the appellant were he returned to Iran, is quite unconvincing. If it was irrelevant to that response, why did the Tribunal repeatedly mention it? By mentioning it, the impact of the a priori classification on the assessment of what the appellant would do is demonstrated. The importance of legal accuracy: I remind myself of the importance of legal accuracy in decisions of this kind. In a case such as the present, decisions of this kind can literally affect the lives of those subject to them131. A rehearing would not ensure the appellant of success in his application for a protection visa. However, it would ensure that the Tribunal addressed itself accurately to the application of the Act to the facts as found. It would also maintain compliance, in the application of this country's law, with the Convention that Australia has ratified. It is a misfortune to order a third hearing of the appellant's application to the Tribunal. However, in my view it is required by the logic of the principle that this Court endorsed in Appellant S395. The possible risks at stake also support that course. Orders I agree in the orders proposed by McHugh J. 131 Abebe v The Commonwealth (1999) 197 CLR 510 at 577-578 [191]; Re Minister for Immigration and Multicultural Affairs; Ex parte Miah (2001) 206 CLR 57 at 147 HAYNE AND HEYDON JJ. The appellant, an Iranian national, sought, but in January 2001 was refused, a protection visa. He claimed that, after he had left Iran and while living in Indonesia, he had embraced the Christian faith. He said that he feared that, if he returned to Iran, he would be executed by the authorities because he had converted from Islam to Christianity. In April 2001, the Refugee Review Tribunal ("the Tribunal") affirmed the decision to refuse the appellant a protection visa. This decision of the Tribunal was set aside by the Federal Court of Australia and the Tribunal, differently constituted, again reviewed the decision to refuse the appellant a protection visa. In December 2001, the Tribunal again affirmed the refusal. The appellant made application to the Federal Court of Australia, pursuant to s 39B of the Judiciary Act 1903 (Cth), for certiorari to quash the Tribunal's decision, mandamus to compel it to review the decision to refuse him a protection visa, and prohibition to prevent the Minister giving effect to the Tribunal's decision. The application was dismissed132 and an appeal to the Full Court of the Federal Court was also dismissed133. By special leave, the appellant now appeals to this Court. The determinative issue in the appeal to this Court is whether the Tribunal addressed the fundamental question that arose in its review of the decision to refuse the appellant a protection visa. That question was: did the appellant have a well-founded fear of persecution on the ground of religion? The appellant contended that the Tribunal did not address that question. He submitted that the Tribunal had sought to categorise the way in which he expressed his belief, with insufficient regard to his individual circumstances, and had asked whether he could avoid persecution while practising his religion in a manner consistent with his core beliefs. He submitted that the Tribunal had thus committed a jurisdictional error similar to the error identified in Appellant S395/2002 v Minister for Immigration and Multicultural Affairs134, decided by this Court after the primary judge and the Full Court decided the present matter. 132 NABD v Minister for Immigration and Multicultural and Indigenous Affairs [2002] FCA 384. 133 Applicant NABD of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs [2002] FCAFC 249. 134 (2003) 216 CLR 473. The Tribunal did not ask itself a wrong question135. It considered whether the appellant had a well-founded fear of persecution if he returned to Iran. It did not ask (as had been the case in Appellant S395/2002) whether it was possible for the appellant to live in Iran in such a way as to avoid adverse consequences. To explain why that is so, it is necessary to say something more about the claims which the appellant made and about the Tribunal's decision. The appellant's claims and the Tribunal's decision The central claim made by the appellant was that, as a convert to Christianity, he would be regarded as an apostate in Iran and, for that reason, would face persecution in that country. He sought to amplify that claim by reference to certain events which he said had occurred before he left Iran, but the Tribunal did not accept that those events had happened, or that he had been "pursued by the authorities [in Iran] for any reason given by him or for any other Convention reason". Rather, the Tribunal accepted that the appellant had been baptised while he was in Indonesia, that he had thereafter undertaken a Bible study course by correspondence, and that he had attended religious gatherings, both in Indonesia and while in immigration detention in Australia. In addition, despite what the Tribunal described as "some serious reservations about the genuineness" of the appellant, it accepted that the appellant had engaged in other religious activities while in detention in Australia including distributing pamphlets, speaking to others privately about his faith, and encouraging interested persons to attend church services held in the detention centre. The Tribunal considered information it had about the way in which Christians were treated in Iran. That information included a publication of the State Department of the United States of America136 and a "Country Profile for use in Refugee Determination: Islamic Republic of Iran (1996)" prepared by the Australian Department of Foreign Affairs and Trade ("DFAT"). The Tribunal summarised the effect of this material by saying that "converts who go about their devotions quietly [in Iran] are not bothered; it is only those who actively seek public attention through conspicuous proselytizing who encounter a real chance of persecution". Although this summary was accurate, it was no more than a summary of a longer and more complex description given by DFAT in its country profile. This 135 Minister for Immigration and Multicultural Affairs v Yusuf (2001) 206 CLR 323 at 351 [82] per McHugh, Gummow and Hayne JJ; Craig v South Australia (1995) 184 CLR 163 at 179. 136 Annual Report on International Religious Freedom for 1999: Iran. country profile recorded that apostasy was widely reported as carrying a nominal death sentence in Iran, but that there were only one or two cases (of what were described as "high profile Christian clergy") where the sentence had ever been imposed and that there were "some senior and influential clerics" in Iran who had recently publicly questioned this interpretation of the Qur'ān. The country profile also recorded that: "Converts are generally tolerated as long as they maintain a very low profile. However, those working in Government and revolutionary organisations may experience workplace harassment, discrimination and possible dismissal if it becomes known that they have converted. The most common source of pressure on converts is from 'concerned' family members." But neither in the Tribunal nor in any of the subsequent court proceedings has the appellant sought to contend that he would be exposed to this kind of conduct, or that such conduct would constitute persecution. It may, therefore, be put to one side. The Tribunal concluded that "the available evidence indicates that if [the appellant] were to practise as a Christian in Iran he would be able to do so in ways he has practised his faith in Australia without facing a real chance of persecution". It went on to say that, although the appellant claimed that he felt it his duty to tell others about his faith, "the evidence is that he is able to do so without facing any serious repercussions providing he does not proselytize". The Tribunal found that the appellant "would not choose to generally broadcast his practice of Christianity or conspicuously proselytize in Iran". Standing alone, that finding would be consistent with the appellant choosing the course described in order to avoid adverse consequences befalling him. But the Tribunal found that the appellant's likely conduct in Iran was not motivated by fear of adverse consequences. It said: "In weighing all the evidence, including [the appellant's] practice of his faith to date and the tenets of that faith, the Tribunal finds that any decision to avoid proselytizing in Iran or of actively seeking attention on matters of religion is not inconsistent with his beliefs and practices. It finds that [the appellant] is not constrained in the practice of his avowed faith, nor would he be in Iran, due to a perception that to behave more openly or aggressively would leave him at risk of persecution." Jurisdictional error? The appellant's case in the courts below has always been, and in this Court was, founded in an allegation of jurisdictional error. The way in which that jurisdictional error has been identified, however, has changed as the case has progressed through the courts, but nothing was said to turn on those changes. In the courts below, some emphasis was given to whether the Tribunal had failed to take into account relevant considerations. In this Court, it was submitted that the Tribunal had fallen into an error of law which caused it to ask itself a wrong question137. It had done so, the appellant submitted, by seeking to categorise the way in which he expressed his beliefs. As was pointed out in Appellant S395/2002138, it is perhaps inevitable that those, like the Tribunal, who must deal with large numbers of decisions about who is a refugee, will attempt to classify cases. There are, however, dangers in creating and applying a scheme for classifying claims to protection. The question for the Tribunal must always be whether the particular applicant is entitled to the visa which is sought. That requires consideration of the criteria prescribed by the Migration Act 1958 (Cth) ("the Act"). In most cases coming to the Tribunal the central question will be, as it was in this case, whether the Tribunal is satisfied139 that the visa applicant is a non-citizen to whom Australia has protection obligations under the Refugees Convention140 as amended by the Refugees Protocol141. The Migration Legislation Amendment Act (No 6) 2001 (Cth) ("the Amending Act"), among other things, introduced the provisions of subdiv AL of Div 3 of Pt 2 of the Act (ss 91R-91X)142. Since these amendments, account must be taken of the provisions of s 91R (concerning what is "persecution") and other provisions of subdiv AL of Div 3 of Pt 2 which may be engaged in a particular case. Although the provisions now found in subdiv AL applied to the appellant 137 Minister for Immigration and Multicultural Affairs v Yusuf (2000) 206 CLR 323 at 351 [82] per McHugh, Gummow and Hayne JJ; Craig v South Australia (1995) 184 CLR 163 at 179. 138 (2003) 216 CLR 473 at 499 [76] per Gummow and Hayne JJ. 139 Migration Act 1958 (Cth), s 36(2). 140 The Convention relating to the Status of Refugees done at Geneva on 28 July 1951. 141 The Protocol relating to the Status of Refugees done at New York on 31 January 142 These amendments apply to applications for a protection visa not granted before these provisions of the Amending Act came into operation on 27 September 2001. See Migration Legislation Amendment Act (No 6) 2001 (Cth), Sched 1, Pt 2, Item 7. nothing was said to turn in this case upon those provisions and they may be put to one side. When reviewing a refusal to grant a protection visa, the question for the Tribunal must always be whether the particular applicant has a well-founded fear of persecution (as persecution is now to be understood143) for a Convention reason. If the applicant fears persecution for a Convention reason, examining whether that fear is well founded requires the Tribunal to decide whether there is a real chance that the applicant would suffer persecution for a Convention reason. As pointed out144 in Chan v Minister for Immigration and Ethnic Affairs, reference to a real chance of persecution must not be substituted for, or be permitted to obscure the content of, the test prescribed in the Convention – whether an applicant holds a well-founded fear of persecution. It is sometimes convenient nonetheless to use the expression "real chance" as a shorthand reference to the nature of the factual inquiry being made. The available material bearing on whether an applicant's subjective fear of persecution for a Convention reason is a fear that is well founded will vary from case to case. Usually, considering whether an applicant's fear is well founded will be assisted by considering how others, in like case to the applicant, are being, or have in the past been, treated145. The difficulties of making such comparisons are obvious. As was pointed out146 in Appellant S395/2002, "the critical question is how similar are the cases that are being compared". It is here that the risks of classification are acute. Putting an applicant in one class rather than in another may determine the outcome of the inquiry; the defining characteristics of the class that is chosen may eliminate from consideration matters that bear upon the chances of the applicant being persecuted. In Appellant S395/2002, the Tribunal was held to have erred by dividing the genus of homosexual males in Bangladesh into two groups – discreet and non-discreet homosexual males. That led, in that case, to the Tribunal assigning the appellants to the former group, without it considering how the appellants wished or intended to behave if returned to Bangladesh. Moreover, the 143 s 91R. 144 (1989) 169 CLR 379 at 389 per Mason CJ, 398 per Dawson J, 407 per Toohey J, 429 per McHugh J. See also Minister for Immigration and Ethnic Affairs v Guo (1997) 191 CLR 559 at 571-575 per Brennan CJ, Dawson, Toohey, Gaudron, 145 Guo (1997) 191 CLR 559 at 575. 146 (2003) 216 CLR 473 at 499 [75] per Gummow and Hayne JJ. classification which was adopted was one which appeared147 to be an incomplete, and therefore inadequate, description of matters following from, and relevant to, sexual identity. More fundamentally, however, the reasoning adopted by the Tribunal in that case revealed that it had not made the essentially individual and fact-specific inquiry which is necessary: does the applicant for a protection visa have a well-founded fear of persecution for a Convention reason? In the present case, the appellant submitted that for the Tribunal to distinguish, as it did, between Christians in Iran who go about their devotions quietly, and those who actively or conspicuously proselytise, revealed error. It was submitted that this revealed error because it showed that the Tribunal had argued from an a priori classification of Christians in Iran to the particular conclusion that the appellant's fears were not well founded because there was not a real chance that the appellant would face persecution in that country. There are two reasons to reject the argument. First, it does not take account of the nature of the information provided to the Tribunal about conditions in Iran. Secondly, it does not accurately reflect the factual findings made, and reasoning recorded, in the Tribunal's reasons for decision. The information available to the Tribunal about Iran was that apostasy was punishable by death. But the information also suggested that there was no real chance of that or other punishment being exacted in any but exceptional cases. Thus the information available to the Tribunal said that there were "only one or two cases (high profile Christian clergy) where this sentence has ever been imposed". Rather, so the information said, "[t]he evidence is that those converts who go about their devotions quietly are generally not disturbed ... [I]t is either those who actively seek attention, or who are engaged in conspicuous proselytization, who have run into difficulties, usually with the local mosque rather than the State authorities". In assessing whether there was a real chance of the appellant being persecuted for a Convention reason, it was essential for the Tribunal to consider the material it had available about conditions in Iran. The information distinguished between those "who go about their devotions quietly" and those who "actively seek attention, or who are engaged in conspicuous proselytization". Applying such a distinction may well be difficult. The two classes are distinct but it may not always be possible to describe an individual's behaviour as falling wholly within one class rather than the other. It follows that there may be cases in which it would be difficult for a decision-maker to choose between the two as an accurate and complete factual description of past or future patterns of behaviour. But the proceedings in the courts below, and on appeal to 147 (2003) 216 CLR 473 at 501-502 [83] per Gummow and Hayne JJ. this Court, were not directed to the sufficiency or accuracy of the Tribunal's fact finding. Rather, the proceedings were necessarily directed to identifying whether there was jurisdictional error. In that respect, attention must be focused upon the findings which the Tribunal made and the reasoning it adopted. In the present case, the Tribunal made findings about the way in which the appellant had hitherto practised his faith and about what he would choose to do in Iran. It accepted that he had discussed Christianity with other detainees but it did not accept that his activities since leaving Iran "constitute[d] active attempts to convert others through proselytism as distinct from quiet sharing of his faith". It concluded that he would not "choose to generally broadcast his practice of Christianity or conspicuously proselytize in Iran". It found that "any decision to avoid proselytizing in Iran or of actively seeking attention on matters of religion is not inconsistent with his beliefs and practices". And, as noted earlier, it found that he was not constrained in the practice of his faith "nor would he be in Iran, due to a perception that to behave more openly or aggressively would leave him at risk of persecution". The Tribunal related its conclusions to the information it had about conditions in Iran. That information drew a distinction which, whatever its difficulties and imperfections, the Tribunal had to consider. It concluded that the appellant's conduct in Australia, if continued in Iran, was properly described as not being proselytizing or actively seeking attention. That is, the Tribunal concluded that the appellant's conduct would fall wholly within one of the descriptions of conduct given in the information it had about treatment of Christians in Iran. At no point in its chain of reasoning did the Tribunal divert from inquiring about whether the fears which the appellant had were well founded. It did not ask (as the Tribunal had asked in Appellant S395/2002) whether the appellant could avoid persecution; it asked what may happen to the appellant if he returned to Iran. Based on the material the Tribunal had, including the material concerning what the appellant had done while in detention, it concluded that were he to practise his faith in the way he chose to do so, there was not a real risk of his being persecuted. No jurisdictional error was demonstrated. The appeal should be dismissed with costs.

HIGH COURT OF AUSTRALIA GUMMOW ACJ, APPELLANT AND ROBERT COLIN NICHOLLS & ORS RESPONDENTS Michael Wilson & Partners Limited v Nicholls [2011] HCA 48 1 December 2011 ORDER Appeal allowed with costs. Set aside paragraphs 3, 4, 5, 6 and 7 of the orders of the Court of Appeal of the Supreme Court of New South Wales made on 15 September 2010. Remit the matter to the Court of Appeal for further consideration of: grounds 5(b) to (c), 6 to 15, 17(b) to (d), 18, 20 and 21 of the Amended Notice of Appeal dated 7 May 2010; and the Notice of Cross-Appeal dated 29 January 2010. Costs of the appeal to the Court of Appeal, including the costs of the hearing on remitter, be in the discretion of that Court. Money paid into Court by the appellant, in satisfaction of a condition of the grant of special leave, be paid out to or at the direction of the appellant. On appeal from the Supreme Court of New South Wales Representation B W Walker SC with M Walton SC and D F C Thomas for the appellant (instructed by Clayton Utz Lawyers) G C Lindsay SC with G W McGrath SC and A D B Fox for the respondents (instructed by Henry Davis York) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Michael Wilson & Partners Limited v Nicholls Courts and judges – Bias – Apprehended bias – Appellant successfully applied ex parte to use respondents' affidavits for foreign proceedings and criminal investigations on several occasions – Judge relied on appellant's unchallenged affidavit evidence – Applications heard in closed court and orders made preventing respondents knowing about applications – Whether fair-minded lay observer might reasonably apprehend judge might not bring impartial and unprejudiced mind to resolution of issues at trial of action. Practice and procedure – Appeal – Trial judge refused respondents' pre-trial disqualification applications – Trial judge offered to make orders facilitating urgent appeal – Whether order on disqualification application capable of appeal – Respondents did not seek leave to appeal – Whether respondents permitted to raise disqualification on appeal from final judgment. Abuse of process – Multiple proceedings – Appellant commenced arbitration proceeding against solicitor in London for breach of fiduciary duty then proceeding against respondents in Supreme Court of New South Wales for knowingly assisting solicitor's breach and in tort – Loss from substantially same breaches of fiduciary duty alleged in both proceedings – Proceedings could not be brought in one venue – Supreme Court delivered judgment before arbitrators delivered award on liability – Findings about appellant's loss differed – Whether Supreme Court proceeding abuse of process. Equity – Remedies – Solicitor liable to appellant for breach of fiduciary duty – Respondents liable to appellant for knowingly assisting solicitor's breach – Whether respondents' liability ancillary to, coordinate with or necessarily limited by solicitor's liability – Equity against double recovery – Whether respondents have equity to prevent appellant enforcing Supreme Court judgment against them where particular loss satisfied pursuant to arbitral award against solicitor. Words and phrases – "abuse of process", "appeal", "apprehended bias", "arbitration", "disqualification", "double recovery", "ex parte application", "multiple proceedings", "order". GUMMOW ACJ, HAYNE, CRENNAN AND BELL JJ. The issues This appeal raised three issues. First, should the judgment entered for the appellant at trial in the Supreme Court of New South Wales have been set aside (as it was by the Court of Appeal) because a fair-minded lay observer might reasonably have apprehended, from what had occurred in several interlocutory applications made before trial by the appellant without notice to the respondents, that the judge might not bring an impartial and unprejudiced mind to the resolution of the issues in the trial? Second, were the respondents (the parties that alleged there was a reasonable apprehension of bias) prevented from making that complaint in an appeal against the final judgment given at trial because they did not seek, before the trial began, to appeal against the trial judge's refusal to recuse himself? Third, did the institution or prosecution (or both institution and prosecution) in the Supreme Court of New South Wales of the appellant's proceedings against the respondents constitute an abuse of the process of the Supreme Court? One of the claims made by the appellant against the respondents in the New South Wales proceedings was that the respondents had knowingly assisted a person not a party to those proceedings in that person's breaches of fiduciary duties to the appellant. The appellant had commenced an arbitration in London against that other person seeking relief for substantially the same breaches of fiduciary duties as the appellant alleged in the New South Wales proceedings. As events turned out, different conclusions were reached in the London arbitration from those reached in the New South Wales proceedings about the loss the appellant suffered as a result of the breaches of fiduciary duty. The three issues raised in this Court should be resolved as follows. There was not a reasonable apprehension that the trial judge was biased. The question of waiver need not be decided. There was not an abuse of process. The appeal should be allowed and consequential orders made. The parties The appellant, Michael Wilson & Partners Limited ("MWP"), was incorporated in the British Virgin Islands. MWP was controlled by Michael Earl Wilson, who described himself as a "corporate transaction lawyer". At the times Gummow ACJ Hayne Crennan Bell relevant to this matter, MWP practised as a law firm and a business consultancy in the Commonwealth of Independent States1 from offices in Kazakhstan. In December 2001, MWP made an agreement with John Forster Emmott, an English and Australian solicitor, that Mr Emmott would join MWP as a director and shareholder with effect from January 2002. They agreed that "in effect" MWP would "operate as a quasi-[p]artnership between them". The agreement provided that each party should have and would observe "the usual partnership obligations and duties to each other". From 24 April 2004 until 1 March 2006, the first respondent (Mr Nicholls, an Australian barrister) was employed by MWP as a senior associate or, as he described himself, a "senior expatriate lawyer". From 1 September 2005 to 9 January 2006, the second respondent (Mr Slater, an Australian solicitor) was employed by MWP as an associate. By the end of June 2006, Messrs Nicholls, Slater and Emmott had all left MWP. Mr Slater did not return to work from annual leave he took from 21 December 2005; Mr Nicholls left employment on 1 March 2006; by letter dated 30 June 2006, Mr Emmott gave notice terminating his agreement with MWP with immediate effect. The third, fourth and fifth respondents ("the Temujin companies") are companies that, at the relevant times, were associated directly or indirectly with some or all of Messrs Nicholls, Slater and Emmott. The exact nature of that association need not be explored. The fourth respondent (Temujin International Ltd – "TIL") operated as a business adviser, agent and arranger, and provided legal services. Two of the Temujin companies (TIL and the third respondent – Temujin Services Ltd) were incorporated in the British Virgin Islands; the third (Temujin International FZE – the fifth respondent) was incorporated in a Free Trade Zone in the United Arab Emirates. Another Temujin company (Temujin Holdings Ltd) and a Kazakhstani limited liability company called Shaikenov & Partners LLP were named as defendants in the New South Wales proceedings, but neither took any active part at first instance, and neither was a party to the subsequent proceedings in the Court of Appeal or this Court. MWP alleged that each of Messrs Nicholls, Slater and Emmott, separately and together, furthered his or their own interests at the expense of MWP. A 1 An association of states that had been constituent republics of the Union of Soviet Socialist Republics. Gummow ACJ Hayne Crennan Bell central allegation was that Messrs Nicholls, Slater and Emmott had conspired together to divert, and had in fact diverted, clients and business opportunities away from MWP to their own benefit by having one or more of the Temujin companies act for the clients in question or by taking advantage of business opportunities that would otherwise have gone to MWP. Arbitration and action MWP sought relief in several different jurisdictions. The persons and entities MWP sued were located in different places. The principal proceedings brought by MWP were an arbitration in London against Mr Emmott and the proceedings in the Supreme Court of New South Wales against Messrs Nicholls and Slater, the Temujin companies and the other defendants mentioned earlier in these reasons. Other litigation in other jurisdictions can conveniently be described as satellite litigation and, although some reference must be made to some of those satellite proceedings, chief focus must fall upon the London arbitration and the New South Wales proceedings. MWP served a notice of arbitration on Mr Emmott in August 2006; it commenced the New South Wales proceedings against Messrs Nicholls and Slater and others in October 2006. It will be necessary to describe the course of events in both proceedings. But before doing that it is desirable to say a little more about why there was both an arbitration and an action and the nature of the claims that were made in each. The London arbitration between MWP and Mr Emmott was instituted in accordance with an arbitration clause contained in the agreement those parties had made. Because Messrs Nicholls and Slater and the other defendants in the New South Wales proceedings were not parties to that (or any other) arbitration agreement with MWP they could not be added as parties to the arbitration between MWP and Mr Emmott. After MWP had commenced its action in New South Wales against Messrs Nicholls and Slater and others, it invited Mr Emmott to consent to being joined as a party to the New South Wales action. Mr Emmott declined that invitation and threatened to seek an anti-suit injunction if MWP took any step to have him joined in the New South Wales proceedings. Thereafter, the London arbitration and the New South Wales proceedings took their separate courses. Because MWP had made the agreement it had with Mr Emmott, the controversy between MWP and those who it alleged had acted together to harm MWP was to be resolved as to part in one venue (the London arbitration) and as to part in another (the Supreme Court of New South Wales). Although MWP Gummow ACJ Hayne Crennan Bell alleged that Mr Emmott had breached fiduciary duties he had owed it, and that Messrs Nicholls and Slater and the corporate defendants in the New South Wales proceedings were liable to MWP because, among other things, they had knowingly assisted Mr Emmott in those breaches, MWP could not have those complaints heard and determined by the one process, whether arbitral or curial. Of the satellite litigation it is enough to notice that, in the Eastern Caribbean Supreme Court, MWP sought and obtained freezing orders against the two Temujin companies that were incorporated in the British Virgin Islands and the appointment of a receiver to several other entities said to be associated with some or other of Messrs Nicholls, Slater and Emmott. In the High Court of Justice in England, MWP obtained freezing orders against Mr Emmott, his wife and others said to be associated with him. In the course of the New South Wales proceedings, MWP made several applications ex parte seeking and obtaining orders against or in relation to Messrs Nicholls and Slater or their assets. It will later be necessary to describe those applications in a little detail for it is those applications and their disposition that lie at the heart of the allegation of apprehended bias. MWP also made complaints or reports to authorities in the British Virgin Islands, the United Kingdom and Switzerland alleging that Mr Emmott had committed criminal offences or that his activities warranted investigation. Again it will be necessary, for the purposes of considering the question of apprehended bias, to notice steps taken in the New South Wales proceedings in connection with the complaint made to Swiss authorities. Before undertaking those tasks, it is as well to identify the general nature of MWP's claims and sketch the course of events in the London arbitration and the New South Wales proceedings. The nature of the claims made by MWP MWP alleged that Mr Emmott had acted in breach of contractual and fiduciary obligations he owed to MWP. It claimed, in the London arbitration, an account of the profits Mr Emmott had made from what it characterised as clients and work he had diverted from MWP to his own benefit. MWP claimed damages for breach of contract, and compensation for the loss occasioned to it by Mr Emmott's breach of fiduciary duties. It appears likely that at some point in the London arbitration MWP also claimed that there should be a general accounting between it and Mr Emmott (in effect, an accounting as between partners) but on the basis of wilful default by Mr Emmott. That was the relief the arbitrators granted. Gummow ACJ Hayne Crennan Bell In the New South Wales proceedings, MWP alleged that Messrs Nicholls and Slater had acted in breach of their contractual and fiduciary obligations and had knowingly assisted Mr Emmott in his breaches of his fiduciary obligations. MWP claimed (amongst other relief) damages, compensation and an account of profits. There was substantial but not exact overlap between the allegations made in both proceedings. In particular, subject to some exceptions which can be put aside as immaterial, there was substantial identity in the allegations made in both proceedings about what clients and business opportunities were said to have been diverted. The course of the London arbitration and the New South Wales proceedings As already recorded, notice of arbitration was given on 14 August 2006 and the New South Wales proceedings were commenced on 9 October 2006. Hearing of the arbitration (on issues of liability only) commenced on 10 November 2008 and concluded on 24 February 2009; trial of the New South Wales proceedings on all issues began on 15 June 2009 and concluded on 10 September 2009. The primary judge in the Supreme Court of New South Wales (Einstein J) delivered reasons for judgment2 on 6 October 2009 and on 11 December 2009 delivered supplementary reasons3 and made final orders granting MWP substantially the relief it had claimed. Among other things, Messrs Nicholls and Slater were held jointly and severally liable to pay MWP $US3,508,793.91, €555,258.94 and $A4,000,000. On 14 December 2009, the present respondents gave notice of appeal to the Court of Appeal of the Supreme Court of New South Wales. On 22 February 2010, the London arbitrators published, as their "Second Interim Award", an interim award on questions of liability. That award held that Mr Emmott was liable to MWP in some but not all of the respects in which Einstein J had found Messrs Nicholls and Slater liable to MWP for knowingly assisting in Mr Emmott's breaches of his fiduciary obligations. In particular, the arbitrators found that some of the clients taken from MWP would not have stayed 2 Michael Wilson and Partners Ltd v Nicholls [2009] NSWSC 1033. 3 Michael Wilson and Partners Ltd v Nicholls [2009] NSWSC 1377. Gummow ACJ Hayne Crennan Bell with MWP once Mr Emmott had left, because they did not want to deal with Mr Wilson. Accordingly, the arbitrators gave MWP no relief against Mr Emmott in respect of the loss of those clients. By contrast, Messrs Nicholls and Slater were held liable in the New South Wales proceedings to compensate MWP in amounts that included an assessment of the value of the lost opportunity for MWP to continue to deal with those clients. On 22 March 2010, in London, MWP filed a Claim form (arbitration) in the High Court of Justice challenging parts of the Second Interim Award under ss 68 and 69 of the Arbitration Act 1996 (UK) (provisions dealing respectively with serious irregularity and appeal on a question of law). This Court was informed that the application has been heard but not determined. The present respondents' appeal against the judgment of Einstein J, and a cross-appeal by MWP, were heard by the Court of Appeal (Basten and Young JJA and Lindgren AJA) in July 2010. That Court allowed4 the appeal, set aside the orders made at first instance, directed that there be a new trial but further directed that the new trial "not commence until the determination of the appeal against the second interim award of the Arbitral Tribunal made on 22 February 2010 in London or, if the appeal is upheld and the Tribunal required to reconsider its reasons in any respect, until the redetermination has been made". The cross-appeal of MWP was dismissed. The Court of Appeal held that there should be a new trial because there had been a reasonable apprehension of bias of the trial judge. It ordered deferral of commencement of the new trial on the footing that otherwise there would be an abuse of process. By special leave, MWP appeals to this Court. Apprehension of bias – the test to be applied It has been established by a series of decisions of this Court5 that the test to be applied in Australia in determining whether a judge is disqualified by 4 Nicholls v Michael Wilson & Partners Ltd (2010) 243 FLR 177. 5 See, for example, Livesey v New South Wales Bar Association (1983) 151 CLR 288; [1983] HCA 17; Johnson v Johnson (2000) 201 CLR 488; [2000] HCA 48; Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337; [2000] HCA 63; Smits v Roach (2006) 227 CLR 423; [2006] HCA 36; Concrete Pty Ltd v Parramatta Design & Developments Pty Ltd (2006) 229 CLR 577; [2006] HCA (Footnote continues on next page) Gummow ACJ Hayne Crennan Bell reason of the appearance of bias (in this case, in the form of prejudgment) is whether a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial and unprejudiced mind to the resolution of the question the judge is required to decide. No party to the present appeal sought in this Court, or in the courts below, to challenge that this was the test to be applied. As the plurality in Johnson v Johnson6 explained, "[t]he hypothetical reasonable observer of the judge's conduct is postulated in order to emphasise that the test is objective, is founded in the need for public confidence in the judiciary, and is not based purely upon the assessment by some judges of the capacity or performance of their colleagues." Because the test is objective it is important to keep an inquiry about apprehension of bias distinct from any inquiry about actual bias. An inquiry about actual bias in the form of prejudgment would require assessment of the state of mind of the judge in question. No doubt that would have to be done, at least for the most part, on the basis of what the judge had said and done. But to allow an inquiry about whether the judge had in fact prejudged some issue to enter into a debate about what a fair-minded lay observer might apprehend is to introduce considerations that are irrelevant to the issue that is to be decided when a party submits that there is or was a reasonable apprehension of bias. The respondents did not submit in this Court or in the courts below that the trial judge had in fact prejudged any issue. The respondents twice submitted to Einstein J that he should recuse himself because there was a reasonable apprehension of bias. On both occasions Einstein J rejected the application. To explain the basis upon which the applications were made and to identify the different stages in the proceedings at which the applications were made, it is necessary to refer to a number of interlocutory applications MWP made in the proceedings. Interlocutory applications In October 2006, MWP obtained freezing orders in relation to certain identified assets of Messrs Nicholls and Slater, both in Australia and elsewhere. Those orders were made by Palmer J. They required Messrs Nicholls and Slater 55; British American Tobacco Australia Services Ltd v Laurie (2011) 242 CLR 283; [2011] HCA 2. (2000) 201 CLR 488 at 493 [12]. Gummow ACJ Hayne Crennan Bell to file affidavits identifying all of their assets including bank accounts and other assets in which they had interests. Later in October 2006, Bergin J made an order, by consent, restricting access to the disclosure affidavits to MWP's legal advisers. In 2007 and 2008, Einstein J heard and determined several applications made by MWP without notice to the defendants in the action. On 26 March 2007, MWP applied to Einstein J, without notice to the defendants, for orders which, among other things, would permit MWP to use the disclosure affidavits that had been made by Messrs Nicholls and Slater in obedience to the orders described above, and the correspondence that related to the affidavits, in proceedings MWP then proposed to institute in "the Eastern Caribbean Supreme Court [and the] High Court of the British Virgin Islands" and for the purpose of "considering the relief and remedies available to [MWP] and possible proceedings in Switzerland". In an affidavit filed in support of the application Mr Wilson described the "possible proceedings in Switzerland" as a criminal complaint against Mr Emmott, another man called Risbey, and entities controlled by them in Switzerland. Mr Wilson said that he believed that "in order to obtain relevant information and to put measures in place to protect assets which are alleged to belong to MWP, criminal proceedings are the most appropriate forum to obtain the relief sought". Neither Mr Nicholls nor Mr Slater was then identified as a person who might be the subject of criminal investigation or charge by Swiss authorities. The application to Einstein J was said to be urgent because of the foreshadowed application in the British Virgin Islands to appoint a receiver to British Virgin Islands entities allegedly controlled by Messrs Nicholls and Slater. It was said that, if Messrs Nicholls and Slater became aware that MWP was making the application to use the disclosure affidavits in connection with an application to appoint receivers, assets controlled by those entities (assets to which MWP alleged it was entitled) would be removed. Einstein J dealt with the application in closed court and made the orders that MWP sought. In his reasons for judgment, Einstein J said that it was "important that the Court scrutinise very closely an application which is made ex parte to vary orders which had been made by consent". He expressed himself to be "satisfied that it is necessary for [MWP] to establish that there has been a significant change in the circumstances" since the consent order was made. The change in circumstances identified was that there were "stark inconsistencies between the affidavits and disclosure information furnished by Mr Slater in the British Virgin Island proceedings as compared with that furnished in similar documents in this jurisdiction" and "likewise discrepancies in the affidavits made Gummow ACJ Hayne Crennan Bell by Mr Nicholls". The reasons set out a list of matters to which the discrepancies were said to relate7. If orders are made without notice to a party it is ordinarily sound practice to require the moving party to give to the opposite party notice of the making of the orders and the material on which the orders were made as soon as reasonably practicable after the making of the orders. The party affected by the orders can then move to have the orders amended or discharged8. And if there is shown to be some real fear that the effect of an order would be frustrated by notice being given before the order is executed, notice of its making and the material on which it is made should nonetheless be given as soon after its making as is consistent with the avoidance of frustration of its effect. There was no consideration given in the reasons of Einstein J to why, if it was necessary to deal with the application ex parte, it was not appropriate to require, once the orders had been carried into effect and the foreshadowed application in the British Virgin Islands dealt with, that MWP give notice to those affected by the orders of both the terms of the orders and the material on which those orders had been made. Rather, on MWP's application, Einstein J ordered, among other things, that MWP's notice of motion and the affidavits on which it had relied not be placed on the Court file; that no part of what had occurred during the hearing or the transcript of the hearing be communicated to any person other than a legal adviser of MWP and otherwise than as was necessary to have the orders taken out; that the associate's note of the making of the orders be kept in the chambers of Einstein J; that the making of the orders not be shown on the Court file. Einstein J also gave leave to MWP to issue a subpoena on a third party returnable on 28 March 2007. The matter came back on for further hearing on 28 March 2007 for the return of the subpoena. On MWP's application, Einstein J made orders for the use of the documents then produced in answer to the subpoena that were in substance identical to the orders of 26 March 2007 in relation to the disclosure affidavits. The third party having not completed its production of documents in cf (2010) 243 FLR 177 at 187 [30]. 8 Owners of SS Kalibia v Wilson (1910) 11 CLR 689; [1910] HCA 77; Thomas A Edison Ltd v Bullock (1912) 15 CLR 679; [1912] HCA 72. See also Cretanor Maritime Co Ltd v Irish Marine Management Ltd [1978] 1 WLR 966; [1978] 3 All ER 164; Smith Kline & French Laboratories (Australia) Ltd v Secretary, Department of Community Services and Health (1989) 89 ALR 366. Gummow ACJ Hayne Crennan Bell answer to the subpoena, Einstein J stood over its further return until 30 March 2007. On 30 March 2007, the matter again came on. Counsel for MWP informed the Court that an order for the appointment of receivers in the British Virgin Islands had been made and that it would soon be enforced. The third party expected to complete production pursuant to the subpoena by the following Tuesday (3 April 2007), so the matter was adjourned to 4 April 2007. Both these further hearings on 28 and 30 March 2007 were conducted in closed court and on both occasions, in addition to the orders described above, orders like those earlier made were made to prevent communication of what had happened in court and to prevent recording on the Court file what orders had been made. However, on both occasions, Einstein J pointed out to the legal representatives of MWP in argument that the "confidentiality parameters" should not remain in place for any longer than was necessary and indicated the desirability of allowing service upon the defendants of MWP's notices of motion, the orders that had been made and the material upon which they had been made. On 5 April 2007, on MWP's application, Einstein J made orders lifting many of the restrictions on publication and the restrictions on recording orders on the Court file and directed MWP to file and serve on the respondents redacted copies of the notices of motion, supporting material, orders and the transcript of proceedings on 26 March 2007. What was to be removed from the copy documents to be filed and served on the respondents was described as: "any parts of those documents which contain any reference to proceedings or potential proceedings in jurisdictions other in [sic than in] the United Kingdom, the British Virgin Islands, Jersey, the Bahamas, Colorado in the United States of America and the proceedings in this Honourable Court". Thus any reference to potential proceedings in Switzerland was removed from the documents served on the respondents. Why this should be done was not examined in the course of the application to Einstein J and was not the subject of any consideration in any reasons for judgment. About one week later (on either 11 or 12 April 2007) MWP made a further ex parte application to Einstein J. MWP sought orders granting it leave (a) to make a criminal complaint to Swiss authorities (and to be joined as a civil party to any criminal proceedings that were instituted), (b) to assist the receiver appointed to the British Virgin Islands entities to furnish a money laundering report to the Financial Investigation Agency in the British Virgin Islands, and (c) to make a criminal complaint to police in the United Kingdom. MWP sought leave to supply and use the disclosure affidavits and associated correspondence Gummow ACJ Hayne Crennan Bell for the purposes of making those complaints, being joined as a party in Switzerland and providing assistance to the authorities. In an affidavit filed in support of the application, Mr Wilson swore that there was a "need for confidentiality" because if any of the defendants to any of the proceedings (including Messrs Nicholls and Slater) became aware of the proposed criminal complaints "there is a danger that the assets controlled by them will be dissipated thereby endangering the purpose of the proposed criminal complaints". Counsel for MWP told Einstein J that, although Messrs Nicholls and Slater were "not the focus of the complaints" that MWP proposed to make, they could be "caught up" in the matter. Why, in these circumstances, their disclosure affidavits should be made available (without their knowledge) to authorities in Switzerland, the British Virgin Islands or the United Kingdom was not explained. MWP again asserted that the matter was urgent because, according to Mr Wilson, there was "a real danger that, as more time passes, more of the assets which are in the hands of Emmott, Nicholls, Slater (and their nominees) and/or their associates and entities controlled by them, will be dissipated and unrecoverable". How this would be done in face of the various freezing orders that had been obtained was not explained. Einstein J made the orders sought. In his reasons for judgment delivered on 12 April 2007, Einstein J said that "to facilitate the effectiveness of the prosecutor's inquiries in each jurisdiction" and "to ensure the effectiveness of steps that may be taken … in Switzerland" the application should remain confidential. Orders were made about disclosure of what had occurred at the hearing and about recording of the orders in similar terms to those that had been made in connection with earlier ex parte applications. Einstein J asked MWP to return to Court on 6 June 2007 to explain "the extent to which and reasons for which the existing confidentiality regime or regimes need to be continued". At that hearing, counsel for MWP submitted that he could not then point to any reason "in relation to asset preservation as a reason for maintaining confidentiality". He further submitted, however, that the existence of "tipping off" legislation (described as legislation that made it an offence to disclose something that may prejudice a serious fraud investigation) in the United Kingdom and British Virgin Islands made it desirable not to alter the then existing regime until authorities in those jurisdictions had been consulted. Being satisfied that no alteration to the existing regime was required, Einstein J adjourned the matter to a date in July for consideration of whether the confidentiality regime should continue. On that day the matter was stood over to the earlier orders about 28 September 2007 without any variation of Gummow ACJ Hayne Crennan Bell confidentiality. Again, at both the 6 June and the July hearings, orders were made about disclosure of what had occurred at the hearing and about the recording of the orders in terms similar to those made in connection with the earlier ex parte applications. In fact the matter seems not to have come on for further hearing until 11 October 2007. On that day, Einstein J was told that there were continuing investigations in England, Switzerland and the British Virgin Islands but that "none of the investigations are directed at prosecuting any party to the New South Wales proceedings". MWP asked Einstein J to direct that the material that had been used in the various applications and had been the subject of confidentiality orders no longer be retained in the judge's chambers but placed in an envelope and put on the Court file subject to an order that the envelope not be opened until further order. Those orders were made. In the reasons for judgment given on 18 October 2007 for making the orders sought by MWP, it was noted that none of the overseas authorities had sought to insist on continuing non-disclosure and that the Swiss authorities had frozen relevant assets. Yet it was said that there was "an obvious risk" that the continuing criminal investigations by authorities "may be impeded if the persons being investigated or identified as possibly assisting in enquiries are forewarned as to the nature of the investigations and the subject matter of the complaints". Why that was still "an obvious risk" was not explained beyond saying that it had been submitted that "questions of timing and extent of disclosures are ordinarily left to the prosecuting authorities themselves, and so should be the case here". The orders for confidentiality that had been made by Einstein J remained in force in one form or another until 13 June 2008, more than a full year after they had first been made. On 13 June 2008, Bergin J made orders by consent giving the legal representatives of the defendants in the action access to the documents that were in the sealed envelope held on the Court file. Those orders prevented any wider disclosure of the material but nothing now turns on that condition. Applications for disqualification On 12 May 2008, about a month before the consent orders were made that gave the defendants access to the material held on the file in a sealed envelope, the defendants asked Einstein J to disqualify himself from hearing any further interlocutory application in the proceedings. The bases upon which this application was made do not appear directly from material reproduced in the appeal books used in this Court. Having regard, however, to what was submitted when later, in May and June 2009, the defendants asked Einstein J to disqualify Gummow ACJ Hayne Crennan Bell himself from trying the action, it may be inferred that the first application for disqualification was based upon what had happened in the earlier interlocutory proceedings. The record available in this Court does not make clear which features of those proceedings founded that complaint. It is not necessary, however, to pursue that aspect of the matter. It is evident from written submissions made at the time of the second disqualification application that the second application was based on a footing no narrower than the first application. In making the second application, the defendants submitted that Einstein J: (a) had "entertained controversial ex parte applications by [MWP], in closed Court, on 7 separate days", (b) had delivered three sets of confidential reasons for judgment, (c) had made confidential orders "designed" to expose the defendants to criminal investigation overseas and to impose upon the defendants an obligation to pay, as part of the ordinary costs of the proceedings, the costs of transcript of the confidential proceedings, and (d) had, in the course of the confidential proceedings, invited MWP to prepare written submissions that could be and were adopted in the preparation of reasons for judgment. identified as being That opportunity was The defendants further submitted that Einstein J had not disclosed the "confidential" proceedings to them "when an opportunity for him to do so the first naturally arose". disqualification application made on 12 May 2008. The defendants submitted that "the nature and extent of the Judge's private dealings" with MWP was disclosed only when consent orders were made on 13 June 2008 giving the defendants' legal representatives access to the materials that had been held on the Court file in a sealed envelope. They submitted that the ex parte orders that Einstein J had made required his acceptance of "'facts' (including opinions and expressions of suspicion) and arguments asserted by Michael Wilson, the principal" of MWP, and "findings that conduct of the Defendants was 'suspicious' and that they could not be trusted: (A) to respect orders of the Court as to the maintenance of confidentiality; (B) to cooperate with police investigations; or (C) not to dissipate assets". The defendants submitted that these findings were "on questions that are the subject of hot contest at the trial and which suggest that [the judge had] prejudged those questions". Einstein J rejected9 the second disqualification application and delivered ex tempore reasons for decision. A few days later the solicitors for the 9 Michael Wilson and Partners Ltd v Nicholls [2009] NSWSC 505. Gummow ACJ Hayne Crennan Bell defendants wrote to the solicitors for MWP saying that the defendants maintained the objection to Einstein J trying the proceeding and asking the solicitors for MWP to join in making an application that the judge recuse himself. Unsurprisingly, the solicitors for MWP refused the invitation to make a joint application and pointed out that Einstein J had granted the defendants "liberty to apply on short notice to obtain an Order to assist in any urgent appeal they might wish to bring in relation to his Honour's ruling". The trial proceeded and, as already noted, MWP succeeded. The respondents in this Court appealed to the Court of Appeal on grounds including grounds alleging that Einstein J should not have tried the case because there was a reasonable apprehension of bias. Apprehension of bias – the Court of Appeal's conclusions The Court of Appeal concluded that Einstein J should have disqualified himself because there was a reasonable apprehension of bias. The principal reasons of the Court of Appeal on this issue were given by Basten JA, who identified10 the circumstances said to be relevant to whether there was a reasonable apprehension of bias. Five matters were identified11 as pointing against that conclusion: (a) the rulings of which complaint was made were interlocutory, not final, (b) there had been a significant lapse of time between the rulings (in 2007) and trial (in 2009), (c) some but not all of the orders and the supporting material were supplied in April 2007 to those against whom the orders had been made, (d) there was no material in the reasons for judgment given in respect of the ex parte applications "which would provide unequivocal support for a reasonable apprehension of prejudgment", and (e) in so far as the matters of concern arising from the interlocutory proceedings may have been thought to affect the assessment by Einstein J of the argument that the proceedings were an abuse of process, that argument had not been raised until four weeks after the trial began. Six matters were said12 to be "countervailing considerations": 10 (2010) 243 FLR 177 at 197-198 [79]-[80]. 11 (2010) 243 FLR 177 at 197-198 [79]. 12 (2010) 243 FLR 177 at 198 [80]. Gummow ACJ Hayne Crennan Bell the material placed before the primary judge was not entirely supportive of the orders made; some of the orders were, in their nature, contestable; neither the transcripts nor the various ex parte judgments revealed full and proper disclosure and consideration of the weaknesses of the applications; it might be thought that the confidentiality regime was maintained beyond a justifiable period; the primary judge acted on a basis as to the credibility and possible criminality of [Messrs Nicholls and Slater], which they had no opportunity to rebut; and the judge made orders on the basis of material put on through the affidavits of Mr Wilson, which he accepted for the purposes of the interlocutory applications, a factor which could have caused him embarrassment when invited to make adverse credit findings against Mr Wilson at the trial." Each of these countervailing considerations was a particular expression of a single central complaint: that "on seven separate days"13 Einstein J had made orders which affected the defendants, without hearing from them, and without providing them with an early opportunity to challenge the bases upon which the orders were made by applying to discharge or vary those orders. In Ebner v Official Trustee in Bankruptcy, the plurality pointed out14 that application of the apprehension of bias principle requires two steps. First, it requires the identification of what it is said might lead the judge to decide a case other than on its legal and factual merits. And second, there must be an articulation of the logical connection between that matter and the feared deviation from the course of deciding the case on its merits. The plurality in Ebner went on to say15 that "[t]he bare assertion that a judge (or juror) has an 'interest' in litigation, or an interest in a party to it, will be of no assistance until 13 (2010) 243 FLR 177 at 199 [85]. 14 (2000) 205 CLR 337 at 345 [8]. 15 (2000) 205 CLR 337 at 345 [8]. Gummow ACJ Hayne Crennan Bell the nature of the interest, and the asserted connection with the possibility of departure from impartial decision making, is articulated". So too, in this case, the bare assertion that the judge appeared to be biased through prejudgment would be of no assistance without articulation of the connection between the events giving rise to the apprehension of bias through prejudgment and the possibility of departure from impartial decision making. In the Court of Appeal, the present respondents sought to articulate the connection between the ex parte applications that had been dealt with by Einstein J and the alleged appearance of prejudgment by pointing to what they said was revealed by the final judgment that had been delivered at trial. They submitted16 that the reasons for judgment delivered at trial "demonstrated a mind which had been, at least subconsciously, influenced to accept the 'case theory' presented by Mr Wilson in his affidavits during the interlocutory proceedings". They submitted17 that Einstein J had not addressed in his reasons arguments that had been made in support of adverse findings about the credibility of evidence Mr Wilson gave at trial, that his Honour had not made sufficiently detailed factual findings to support the conclusions he reached about liability and the relief to be granted and that, although he had apparently accepted the evidence of certain witnesses called on behalf of the defendants, he had "paid no attention to the possible consequences of their evidence in relation to the relief granted". Basten JA noted18 that these considerations might have been thought to demonstrate actual rather than apprehended bias but that no submission of actual bias had been made. Basten JA said19 that it was "not appropriate" to consider that argument further, but continued20: "The alternative basis, on which the appellants [the present respondents] did rely, was that this material confirmed in a practical fashion the reasonableness of the apprehension of bias otherwise created by the pre-trial events. … [I]t may be said that these aspects of the judgment would have prevented any diminution in the apprehension which the lay 16 (2010) 243 FLR 177 at 198 [82]. 17 (2010) 243 FLR 177 at 198-200 [82], [88]-[90]. 18 (2010) 243 FLR 177 at 200 [91]. 19 (2010) 243 FLR 177 at 200 [91]. 20 (2010) 243 FLR 177 at 200 [91]. Gummow ACJ Hayne Crennan Bell observer might otherwise have felt and which might have been laid to rest by persuasive reasoning, inconsistent with the apprehension." (emphasis added) Basten JA concluded21 that there was "substance in each of the complaints made in relation to the judgments" and that it was "sufficient to accept that the final reasons [of Einstein J] did not remove the pre-existing apprehension of bias, as being unfounded". More particularly, Basten JA concluded22 that there was a reasonable apprehension that Einstein J "might not be able to bring an open mind to the issues raised in the trial, and particularly an assessment of the credibility of Mr Wilson on the one hand and Messrs Nicholls and Slater on the other". The judgments given by Einstein J following trial were said23 to "tend to enhance, rather than diminish, the apprehension that would otherwise arise". Apprehended bias not established As pointed out earlier in these reasons, an allegation of apprehended bias requires an objective assessment of the connection between the facts and circumstances said to give rise to the apprehension and the asserted conclusion that the judge might not bring an impartial mind to bear upon the issues that are to be decided. An allegation of apprehended bias does not direct attention to, or permit consideration of, whether the judge had in fact prejudged an issue. To ask whether the reasons for judgment delivered after trial of the action somehow confirm, enhance or diminish the existence of a reasonable apprehension of bias runs at least a serious risk of inverting the proper order of inquiry (by first assuming the existence of a reasonable apprehension). Inquiring whether there has been "the crystallisation of that apprehension in a demonstration of actual prejudgment"24 impermissibly confuses the different inquiries that the two different allegations (actual bias and apprehended bias) require to be made. And, no less fundamentally, an inquiry of either kind moves perilously close to the fallacious argument that because one side lost the litigation the judge was biased, or the equally fallacious argument that making some appealable error, whether by not dealing with all of the losing side's arguments or otherwise, demonstrates prejudgment. 21 (2010) 243 FLR 177 at 200 [92]. 22 (2010) 243 FLR 177 at 201 [94]. 23 (2010) 243 FLR 177 at 201 [94]. 24 (2010) 243 FLR 177 at 200 [91]. Gummow ACJ Hayne Crennan Bell The Court of Appeal was wrong to take account as it did of the reasons for judgment published by Einstein J after the trial in deciding whether in this case there was a reasonable apprehension of bias. The central and determinative question for this aspect of the matter was: might what was done in connection with MWP's ex parte applications reasonably cause a fair-minded lay observer to apprehend that the judge might not bring an impartial mind to the resolution of a question for decision at the trial? Basten JA rightly accepted25 that the making of an interlocutory order does not, of itself, preclude the judge from sitting on the trial of that matter, at least where the orders "are made inter partes and it cannot be said that there has been communication between one party and the judge in the absence of the other party or parties". As Basten JA pointed out26, again correctly, an interlocutory order "will not usually require a judge to determine any matter on a final basis". Here, however, it was said27 that "the fact that one party appeared before the judge on seven separate days in closed court raised a different and additional concern". That concern was identified28 as the possibility "in such circumstances that the judge's mind will become familiar with the character of the plaintiff's case to an extent that, consciously or subconsciously, there will be a tendency to place the further evidence within the pre-existing mental structure" (emphasis added). But the existence of a "concern" described as the possibility of placing the evidence led at trial into a "pre-existing mental structure" does not demonstrate that the fair-minded lay observer might reasonably apprehend that the judge might have prejudged an issue to be decided at trial. In order to establish such a reasonable apprehension it is necessary to analyse more closely the connection that is asserted between the conduct and disposition of interlocutory applications and the possibility of prejudgment. The fact that Einstein J made several ex parte interlocutory orders and on each occasion directed that those applications, the material in support, the reasons for making the orders and the orders themselves not be disclosed to one side of the litigation did not found a reasonable apprehension of prejudgment of the issues that were to be fought at trial. It may well be that the directions not to 25 (2010) 243 FLR 177 at 199 [83]. 26 (2010) 243 FLR 177 at 199 [83]. 27 (2010) 243 FLR 177 at 199 [85]. 28 (2010) 243 FLR 177 at 199 [85]. Gummow ACJ Hayne Crennan Bell disclose material should not have been left in force for as long as they were. Perhaps they should not have been made at all. But if their making or the failure to limit their duration was wrong, that did not found a reasonable apprehension of bias. All of the applications MWP made to Einstein J without notice to the opposite parties were applications about the use that MWP or Mr Wilson could make of the disclosure affidavits made by Messrs Nicholls and Slater and associated correspondence or of documents produced on subpoena. More particularly, a central question in each application was whether that material could be supplied to others. In none of the applications was Einstein J required to make, and in none of the applications did he make, any determination of any issue that was to be decided at trial29. Einstein J did decide that the disclosure affidavits could be made available for use in applications made to another court (for freezing orders and appointment of receivers) and for use by investigating authorities in other countries. And he decided that the proceedings which yielded those orders and the orders themselves should not be disclosed to the present respondents. But in none of the applications was it necessary for Einstein J to make any finding about the reliability of any party or witness, and in none did he make such a finding30. Nor was Einstein J required to make any choice between competing versions of events. All that was required, and all that was found, was that there was apparently credible evidence of a sufficient risk of dissipation of assets to warrant making the confidentiality orders that were made. Neither the hearing nor the disposition of any of the ex parte applications could found a reasonable apprehension of prejudgment of the credit of those who gave evidence in support of the applications. Their credit was not challenged in the ex parte hearings and no decision had to be made about their credit beyond determining that the unchallenged evidence they gave was apparently credible. Nor could the hearing or the disposition of the applications found a reasonable apprehension of prejudgment of the credit of those who had given no evidence in relation to the applications and who first were heard to give evidence at trial. There was, therefore, no sufficient basis to conclude that there was reasonable apprehension that Einstein J might have, as Young JA said31, "put himself into 29 cf British American Tobacco Australia Services Ltd v Laurie (2011) 242 CLR 283. 30 cf R v Watson; Ex parte Armstrong (1976) 136 CLR 248; [1976] HCA 39. 31 (2010) 243 FLR 177 at 205 [122]. Gummow ACJ Hayne Crennan Bell the mindset of accepting that [MWP or MWP's witness] is the 'good guy' and thus the opponent is otherwise". And the Court of Appeal concluded that there was such a reasonable apprehension only by (impermissibly) reasoning backwards from what was decided at trial, and how it was decided, to the conclusion that it might reasonably be apprehended that the judge might have prejudged those matters. Giving up the right to complain? The respondents did not seek leave to appeal against the refusal by Einstein J of their application that he not try the proceedings. In light of the conclusion that there was not a reasonable apprehension of bias in this case, it is not necessary to decide whether the respondents were thus not able to pursue the issue in their appeal against the final judgment given at trial. It is as well, however, to make the following points. It is well established32 that a party to civil proceedings may waive an objection to a judge who would otherwise be disqualified on the ground of actual bias or reasonable apprehension of bias. (It may well be that the principle extends to criminal proceedings but that issue need not be considered.) If a party to civil proceedings, or the legal representative of that party, knows of the circumstances that give rise to the disqualification but acquiesces in the proceedings by not taking objection, it will likely be held33 that the party has waived the objection. Here, of course, the respondents did object to Einstein J trying the proceeding. They did not waive their objection by any failure to raise the point. But could they, having failed in their application to have Einstein J recuse himself, raise the issue on appeal against the final judgment entered at trial? In general, any interlocutory order which affects the final result can be challenged in an appeal against final judgment34. As the majority noted in 32 See Vakauta v Kelly (1989) 167 CLR 568 at 577-579 per Dawson J; [1989] HCA 44 and the cases cited there. 33 See, for example, Smits v Roach (2006) 227 CLR 423 at 439-440 [43] per Gleeson CJ, Heydon and Crennan JJ, 445 [61] per Gummow and Hayne JJ. 34 Gerlach v Clifton Bricks Pty Ltd (2002) 209 CLR 478 at 482-484 [4]-[7] per Gaudron, McHugh and Hayne JJ; [2002] HCA 22. Gummow ACJ Hayne Crennan Bell Gerlach v Clifton Bricks Pty Ltd35, there may be some limits to that general rule but it was not necessary in that case, and is not now necessary, to decide what those limits might be. The majority in Gerlach noted36, however, that there are some kinds of interlocutory decision made otherwise than at trial that may present other issues. In particular37, "[t]here are circumstances in which an interlocutory decision must be treated as concluding an issue between the parties" and reference was made in that regard to O'Toole v Charles David Pty Ltd38 and Fidelitas Shipping Co Ltd v V/O Exportchleb39. In most cases, a judge's refusal of an application that the judge not try, or continue to try, a case on account of reasonable apprehension of bias will constitute a final determination by the judge that the facts and circumstances relied on by the applicant do not establish the relevant apprehension. In such a case, it may be that an applicant who does not seek to challenge the refusal by seeking leave to appeal should be held to have given up the point. In this case, if the respondents were right in asserting that there was a reasonable apprehension of bias, the whole of the trial with its attendant expense and use of court time would be wasted. Of course it must be recognised that the respondents in this case had no right to appeal against the refusal of Einstein J to recuse himself. But the respondents did have a right to seek leave to appeal. As was explained in Gas & Fuel Corporation Superannuation Fund v Saunders40, a later interlocutory order made by a judge who has refused an application that the judge not hear the matter on account of a reasonable apprehension of bias is an order against which leave to appeal can be sought on the ground that the judge who made the order should not have done so. Conversely, as Saunders itself illustrates, where a judge allows an application for 35 (2002) 209 CLR 478 at 484 [8]. 36 (2002) 209 CLR 478 at 484 [8]. 37 (2002) 209 CLR 478 at 484 [8]. 38 (1990) 171 CLR 232 at 245 per Mason CJ; [1990] HCA 44. 39 [1966] 1 QB 630 at 642. 40 (1994) 52 FCR 48 at 64 per Gummow and Heerey JJ. See also Brooks v The Upjohn Company (1998) 85 FCR 469 at 475-476. Gummow ACJ Hayne Crennan Bell disqualification and makes orders effecting that decision41, leave to appeal can be sought against those orders on the ground that they should not have been made. Thus the order against which the respondents could have sought leave to appeal in this case was whatever order was made by Einstein J after he had refused to recuse himself. If, as the respondents asserted, Einstein J should not have continued to sit in the matter, whatever order was made (other than an order adjourning the case for the purpose of allowing another judge to deal with it) was an order which should not have been made by the judge who made it and would found an application for leave to appeal. And as it happened Einstein J made such an order on 4 June 2009 when he set dates for compliance with the general requirements for trial of proceedings in the Equity Division. In so far as Barton v Walker42 holds to the contrary, that decision should not be followed. The decision in Barton v Walker depended upon the proposition that whether a judge should continue to hear a case was a matter only for the judge concerned and that a motion that the judge disqualify himself or herself 41 Gas & Fuel Corporation Superannuation Fund v Saunders (1994) 52 FCR 48 at 42 [1979] 2 NSWLR 740. Gummow ACJ Hayne Crennan Bell was "not cognizable"43; the judge was held44 to make no order on the application for disqualification. The decisions about apprehension of bias that have been given by this Court since Barton v Walker show that a judge's decision to grant or refuse an application for disqualification is not a matter only for the particular judge. As was pointed out45 in the plurality reasons in Ebner, the apprehension of bias principle has its roots in principles fundamental to the common law system of adversarial trial. Whether failure to seek leave to appeal against refusal of an application that a judge not try the case on account of a reasonable apprehension of bias precluded maintenance of the complaint in an appeal against the final judgment would require consideration of whether the failure to seek that leave was reasonable. That would require examination of all relevant circumstances. Ordinarily those would include the stage the proceedings had reached when the disqualification application was made and refused and the consequences that issue of would disqualification until after trial. In this case, trial was fixed to begin within a very short time after the refusal. How much time and money would be spent if the question were to be left over to an appeal against final judgment? The trial of this matter was expected to be very long. A lot of time and money would have been wasted if the judge who tried the proceedings should not have done so. leaving appellate determination of follow from the If it was reasonable in the circumstances of the particular case not to seek leave, and there was no other basis upon which a choice not to persist with the allegation of apprehended bias can be identified as having been made (either then or at some later time), the point would remain open in an appeal against the final judgment. But if it was reasonable in the circumstances to seek leave, and leave was not sought, why should it not be concluded, absent countervailing considerations, that the party making the complaint did not maintain the objection? Simply saying to the opposite party that it is sought to preserve the 43 [1979] 2 NSWLR 740 at 750. See also R v Watson; Ex parte Armstrong (1976) 136 CLR 248 at 266 per Barwick CJ, Gibbs, Stephen and Mason JJ; Rajski v Wood (1989) 18 NSWLR 512; Australian National Industries Ltd v Spedley Securities Ltd (In liq) (1992) 26 NSWLR 411. 44 [1979] 2 NSWLR 740 at 751. 45 (2000) 205 CLR 337 at 343-345 [3]-[7]. Gummow ACJ Hayne Crennan Bell point for consideration in an appeal against final judgment would not of itself be effective to achieve that result. As explained earlier these points need not be decided. It is, however, important to add, contrary to what was said in the Court of Appeal46, that an application for leave to appeal against the rejection of an application that a judge not hear a matter due to apprehended bias may well be a case where the usual criteria47 would require leave to be granted, at least if a long and costly trial would be wasted if the judge's decision were incorrect. Abuse of process? The third issue raised in the appeal to this Court was whether the Court of Appeal was right to hold that there was an abuse of process. It will be necessary to identify the different ways in which the Court of Appeal identified an abuse and the still further ways in which, in the course of the appeal to this Court, the respondents sought to identify an abuse. Before doing so, however, it is as well to say something shortly about the general subject of abuse of process. It has long been recognised that the term "abuse of the process of the court" may be used in different senses48. This case concerns an alleged abuse of the process of the Supreme Court of New South Wales. The respondents submitted that the abuse requires either, as the Court of Appeal held, an order staying the further prosecution of the New South Wales proceedings pending the final determination of the London arbitration, or the dismissal of at least some of the claims that MWP made in the New South Wales proceedings. As the majority pointed out in Batistatos v Roads and Traffic Authority (NSW)49, "[w]hat amounts to abuse of court process is insusceptible of a formulation comprising closed categories". In Ridgeway v The Queen, Gaudron J 46 (2010) 243 FLR 177 at 197 [77] per Basten JA. 47 Adam P Brown Male Fashions Pty Ltd v Philip Morris Inc (1981) 148 CLR 170; [1981] HCA 39; Gerlach v Clifton Bricks Pty Ltd (2002) 209 CLR 478 at 485-486 48 Varawa v Howard Smith Co Ltd (1911) 13 CLR 35 at 55 per Griffith CJ; [1911] HCA 46. 49 (2006) 226 CLR 256 at 265 [9] per Gleeson CJ, Gummow, Hayne and Crennan JJ; [2006] HCA 27. Gummow ACJ Hayne Crennan Bell noted50 that the concept extended to proceedings "instituted for an improper purpose", and to proceedings that are "seriously and unfairly burdensome, prejudicial or damaging"51 or "productive of serious and unjustified trouble and harassment"52. In Rogers v The Queen, McHugh J concluded53 that, although the categories of abuse of process are not closed, many cases of abuse can be identified as falling into one of three categories: "(1) the court's procedures are invoked for an illegitimate purpose; (2) the use of the court's procedures is unjustifiably oppressive to one of the parties; or (3) the use of the court's procedures would bring the administration of justice into disrepute." One recognised class of abuse of process is where proceedings are instituted against a party in a second forum when there are proceedings against that party pending in another and the continuance of the second would be an abuse of the process of the first54. In such a case, the continuance of the second proceedings would be an abuse if it would be unjustifiably oppressive to the party that is named as defendant in both forums. But, of course, that was not this case. The respondents to the appeal in this Court were not, and could not have been, joined as respondents to the London arbitration. And it was not suggested that Mr Emmott could have been joined as a party to the New South Wales proceedings. How then was there said to be an abuse of process in this case? To answer that question it is necessary to begin by identifying when and how the contention was raised. Shortly before the trial began, the respondents applied55 to have the proceedings stayed or dismissed as an abuse of process. As framed, the 50 (1995) 184 CLR 19 at 74-75; [1995] HCA 66. 51 Oceanic Sun Line Special Shipping Co Inc v Fay (1988) 165 CLR 197 at 247; [1988] HCA 32. 52 Hamilton v Oades (1989) 166 CLR 486 at 502; [1989] HCA 21. 53 (1994) 181 CLR 251 at 286; [1994] HCA 42. 54 See, for example, Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538; [1990] HCA 55. 55 [2009] NSWSC 1033 at [586]. Gummow ACJ Hayne Crennan Bell application alleged56 that the institution and maintenance of the proceedings was an abuse of process "in that they have been instituted and maintained for [a] collateral, improper purpose" and that the maintenance of the proceedings was an abuse because MWP had "conducted (and persists in conducting) the proceedings in a manner that is vexatious and oppressive and there is a reasonable apprehension that it will continue to do so". The application set out a list of respects in which it was alleged that MWP and Mr Wilson had acted inappropriately, both during the proceedings and before they were commenced. Determination of that application was deferred57 until trial. The desirability of following that course was not canvassed in argument in this Court. In the first set of reasons for judgment that were published after trial (dealing chiefly with issues of liability) Einstein J rejected58 the application. In the Court of Appeal the respondents again alleged59 that the proceedings should be dismissed as an abuse of process. The alleged abuse appears to have then been formulated in several different ways. Basten JA identified60 it as depending upon three propositions: (a) that there was an "absence of connection between [MWP] and the subject matter of its claims, and New South Wales", (b) "the close connection between [MWP] and the conduct on which the claims were based, and Kazakhstan", and (c) "the relationship involving [MWP] and between the London arbitration Mr Emmott". The first two propositions were rejected61 and were not pursued in this Court. They may be put aside from further consideration. The Court of Appeal's conclusion that there was an abuse depended upon the third proposition concerning the relationship between the claims made in the New South Wales proceedings and those made in the London arbitration. the claims and Basten JA concluded62 that, to the extent that MWP was unsuccessful in the arbitration, it should not be able to pursue claims against the present 56 [2009] NSWSC 1033 at [588]. 57 [2009] NSWSC 1033 at [583]. 58 [2009] NSWSC 1033 at [644]. 59 (2010) 243 FLR 177 at 201 [96]-[97]. 60 (2010) 243 FLR 177 at 201 [97]. 61 (2010) 243 FLR 177 at 201-202 [98]. 62 (2010) 243 FLR 177 at 203 [104]-[105]. Gummow ACJ Hayne Crennan Bell respondents based upon those aspects of Mr Emmott's liability. To do so, Basten JA said63, was to "constitute a collateral challenge to the findings of the arbitrators". Reference was made in this regard to the decision of the Court of Appeal in Rippon v Chilcotin Pty Ltd64, a case directed principally to the application of doctrines of preclusion and, in particular, an extension of that species of preclusion dealt with in Port of Melbourne Authority v Anshun Pty Ltd65. Lindgren AJA described the abuse differently. He identified66 it as being the enforcement of the orders obtained at trial when (a) any liability attaching to the respondents "is ancillary, or coordinate with, liability attributed by the Court to Mr Emmott" and the entitlements of MWP and Mr Emmott had been determined, as between them, in the arbitration, and (b) MWP "must be taken to have received from Mr Emmott, by virtue of the Arbitration Award, satisfaction of any liability owed to [MWP] by Mr Emmott (eg, as a 'co-conspirator' under the common law or in respect of a breach of fiduciary obligations in equity) in common with" the respondents. In this Court, the respondents supported the reasoning of the Court of Appeal but also advanced some further arguments that, in effect, sought to reframe the ways in which an abuse was alleged to arise. The respondents initially placed the chief weight of their arguments in this Court about abuse of process on the proposition that the abuse that had occurred (or would occur) in this case was the same as, or at least analogous to, that considered in Reichel v Magrath67. In that case, "the same question having been disposed of by one case, the litigant [sought] by changing the form of the proceedings to set up the same case again"68. In the course of argument in this Court, the respondents proffered an alternative formulation. They submitted that there was an abuse of the process of 63 (2010) 243 FLR 177 at 203 [104]. 64 (2001) 53 NSWLR 198. 65 (1981) 147 CLR 589; [1981] HCA 45. 66 (2010) 243 FLR 177 at 249-250 [393], [398]. 67 (1889) 14 App Cas 665. 68 (1889) 14 App Cas 665 at 668. Gummow ACJ Hayne Crennan Bell the Supreme Court of New South Wales "insofar as the predominant purpose of [MWP] was the institution or maintenance of the proceedings directed toward obtaining an advantage for which the proceedings were not designed or an advantage beyond what the law offers". The "advantage" was described as being the claim for, or recovery of, compensation from the respondents as accessories to Mr Emmott "independent of the taking of accounts between [MWP] and Mr Emmott and without bringing into account in favour of the Respondents profits or property (by way of set off or otherwise) for which [MWP] is or might be obliged to account to Mr Emmott". Each of the different formulations of the alleged abuse adopted in the Court of Appeal or advanced in argument in this Court is flawed. Neither the institution nor the prosecution to judgment of the proceedings was an abuse of the process of the Supreme Court of New South Wales. No abuse of that process emerged for the first time when the arbitrators reached conclusions that differed from those reached by Einstein J. It is convenient to deal first with the formulation adopted by Basten JA – that there was an abuse because the New South Wales proceedings should be treated as a form of collateral attack upon the arbitrators' findings. In its terms, the proposition appears to presuppose that the arbitral award preceded the institution of, or at least the giving of judgment in, the proceedings in the Supreme Court. But that is not so. The arbitrators' award on issues of liability was not published until after judgment had been entered for MWP in the New South Wales proceedings. In those circumstances there was not, and could not have been, any attack at the trial of the proceedings in the Supreme Court of New South Wales upon any finding of the arbitrators. If the conclusion that there was an abuse because there was some collateral attack upon findings of the arbitrators did not proceed from an erroneous presupposition of the kind described, it is anything but clear when the alleged abuse was said to have arisen or how it was said to be constituted. How could an abuse of that kind be said to have arisen at the commencement of the proceedings? How could it arise before the arbitrators' award was published? How is it that an abuse of process could spring into existence upon the arbitrators making their award after judgment had been given in the proceedings? The respondents offered no explanation, whether by reference to the reasons of Basten JA or otherwise. All of the arguments that asserted there was an abuse of process proceeded, explicitly or implicitly, from a common starting point – that any liability of the respondents to MWP for knowingly assisting Mr Emmott in the breach of his fiduciary duties was limited by the nature and extent of the relief Gummow ACJ Hayne Crennan Bell MWP sought and obtained in the arbitration of its claims against Mr Emmott. That is, as Lindgren AJA put69 the point, the liability of the respondents was no more than "ancillary, or coordinate with," the liability of Mr Emmott. This understanding of the relationship between the liabilities of a defaulting fiduciary and a knowing assistant of the fiduciary's breach should not be accepted. Before explaining why that is so, three important, but nonetheless subsidiary, points should be made about particular aspects of the respondents' arguments about abuse of process. First, to the extent to which the submissions about abuse depended upon the proposition that prosecution of the New South Wales proceedings to judgment, or the subsequent execution of that judgment, might lead to MWP recovering compensation for more than it had lost, the submissions ignored the equity which the respondents (and Mr Emmott) would have to prevent enforcement of an award or judgment against them where to do so would lead to double recovery70. The respondents (and Mr Emmott) would have an equity to prevent enforcement of a judgment (or an award) to the extent to which the claim or claims for compensation for which judgment (or the award) was obtained had been satisfied. And as between Mr Emmott and the respondents the doctrine of contribution71 would regulate the ultimate allocation of the burden of satisfying the particular claims. The spectre of double recovery and unjust allocation of responsibility for satisfaction of liabilities to compensate MWP for loss it suffered must therefore be put aside from consideration in connection with the allegation of an abuse of process. 69 (2010) 243 FLR 177 at 249 [393]. 70 Thompson v Australian Capital Television Pty Ltd (1996) 186 CLR 574 at 608 per Gummow J; [1996] HCA 38; Baxter v Obacelo Pty Ltd (2001) 205 CLR 635 at 653-654 [38]-[40] per Gleeson CJ and Callinan J, 658-659 [56]-[57] per Gummow and Hayne JJ; [2001] HCA 66; Morris v Robinson (1824) 3 B & C 196 at 205-206 [107 ER 706 at 710]; Tang Man Sit v Capacious Investments Ltd [1996] AC 514 at 71 Albion Insurance Co Ltd v Government Insurance Office (NSW) (1969) 121 CLR 342 at 349-350 per Kitto J; [1969] HCA 55; Burke v LFOT Pty Ltd (2002) 209 CLR 282 at 292-293 [14]-[16], 294 [22] per Gaudron ACJ and Hayne J, 298-299 [38] per McHugh J; [2002] HCA 17; Friend v Brooker (2009) 239 CLR 129 at 148-149 [38]-[43] per French CJ, Gummow, Hayne and Bell JJ (Heydon J agreeing); [2009] HCA 21. Gummow ACJ Hayne Crennan Bell The second point is related to the first. The respondents stressed that MWP obtained in the London arbitration an award which required, in effect, a general accounting between MWP and Mr Emmott. Amounts which the arbitrators found Mr Emmott liable to pay MWP would be an important element in that accounting. But it is also clear that for the purposes of that accounting MWP would be obliged to allow amounts which it owed to Mr Emmott in the taking of accounts as on the dissolution of a partnership. The accounts have not yet been taken. Until those accounts are struck, and amounts due between the parties are set off, it is not clear which of MWP or Mr Emmott would owe a net balance to the other. Upon the accounts being struck, MWP may obtain satisfaction of some or all of what the arbitrators find to be owed to MWP by Mr Emmott. If, for example, the amount which Mr Emmott owes MWP were to be less than the total of the amounts due to him from MWP on a final accounting as between partners, the reduction in the amount which MWP would otherwise have owed Mr Emmott would constitute satisfaction of Mr Emmott's liability to MWP. But, contrary to the respondents' submissions, the bare fact that there has been an award which requires the taking of accounts does not constitute satisfaction of Mr Emmott's liability to MWP. It does not entail that MWP is to be barred from pursuing to judgment its claims against persons who it alleges knowingly assisted Mr Emmott in the breach of his fiduciary duties. Nor does it entail that MWP could not enforce the judgment it obtained against persons proved to have knowingly assisted a breach of fiduciary duty by Mr Emmott. Whether the respondents would have an equity to prevent enforcement of the judgment against them would depend upon whether MWP's claims for compensation had been satisfied. The third point to be made is that each of the several different formulations of abuse depended upon treating the claims made against the respondents for knowingly assisting Mr Emmott in a breach or breaches of his fiduciary duties as the only relevant claims made in the New South Wales proceedings. They were not. MWP made, and succeeded72 in, claims against the respondents for the torts of conspiracy and procuring breach of contract. Damages for those torts were not assessed separately73 because it was not shown that the damages allowable would differ in any respect from the amounts to be allowed as equitable compensation for knowingly assisting in the breach of 72 [2009] NSWSC 1033 at [284]-[290], [291]-[302]. 73 [2009] NSWSC 1033 at [582]; [2009] NSWSC 1377 at [49], [64]-[65]. Gummow ACJ Hayne Crennan Bell Mr Emmott's fiduciary duties. But it is not right to treat the success of the claims in tort as irrelevant to the consideration of whether there was an abuse of process in instituting or maintaining the claims that were made against the respondents or in enforcing a judgment that was obtained at trial of those claims. In the New South Wales proceedings the respondents were found liable to MWP for torts that required no proof of breaches by Mr Emmott of his fiduciary obligations. Mr Emmott was not found in the London arbitration to be liable in tort. It was not, and could not be, suggested that the pursuit of the claims in tort that were made against the respondents was an abuse of process. The claim that there was an abuse of the process of the Supreme Court of New South Wales was flawed for a more fundamental reason than the three particular matters that have just been examined. No matter how the allegation of abuse of process was formulated, the allegation depended upon treating the liability of the respondents as necessarily confined by the extent of Mr Emmott's liability to MWP. This was said to be because the respondents' liability to MWP was no more than accessorial to the principal wrongdoing of Mr Emmott. That is not so. The claims against the respondents, as knowing assistants, were not dependent upon the claims made against Mr Emmott in the fashion asserted by the respondents. As MWP rightly pointed out, this Court has held74 that liability to account as a constructive trustee is imposed directly upon a person who knowingly assists in a breach of fiduciary duty. The reference to the liability of a knowing assistant as an "accessorial" liability does no more than recognise that the assistant's liability depends upon establishing, among other things, that there has been a breach of fiduciary duty by another. It follows, as MWP submitted, that the relief that is awarded against a defaulting fiduciary and a knowing assistant will not necessarily coincide in either nature or quantum. So, for example, the claimant may seek compensation from the defaulting fiduciary (who made no profit from the default) and an account of profits from the knowing assistant (who profited from his or her own misconduct). And if an account of profits were to be sought against both the defaulting fiduciary and a knowing assistant, the two accounts would very likely differ75. It follows that neither the nature nor the extent of any liability of the respondents to MWP for knowingly assisting Mr Emmott in a breach or breaches of his fiduciary obligations depends upon the 74 Consul Development Pty Ltd v DPC Estates Pty Ltd (1975) 132 CLR 373 at 397, 408; [1975] HCA 8. See also Farah Constructions Pty Ltd v Say-Dee Pty Ltd (2007) 230 CLR 89 at 159 [160]-[161]; [2007] HCA 22. 75 See Consul Development (1975) 132 CLR 373 at 397-398. Gummow ACJ Hayne Crennan Bell nature or extent of the relief that MWP obtained in the arbitration against Mr Emmott. No doubt the respondents' liability as knowing assistants to a breach of fiduciary duty depends upon proof, in the proceedings against the respondents, that there was a relevant breach of fiduciary duty by Mr Emmott. It may be doubted that MWP would have been precluded from pursuing that allegation in the New South Wales proceedings if, contrary to the fact, the arbitrators had found, before judgment was given in the New South Wales proceedings, that Mr Emmott had not breached his fiduciary obligations in any respect. Such a finding, in proceedings between other parties, would not estop MWP from asserting to the contrary in the proceedings against alleged knowing assistants. The principles stated in Port of Melbourne Authority v Anshun Pty Ltd76 and in Rippon v Chilcotin Pty Ltd77 could not be directly applied. (As explained at the outset of these reasons, the claim against the knowing assistants could not have been brought in the proceedings against Mr Emmott. Once Mr Emmott insisted upon performance of the arbitration clause in his agreement, there had to be separate proceedings against the alleged knowing assistants.) It is not necessary to decide whether some wider principle of abuse of process could be engaged in a case of the kind postulated. In so far as the respondents submitted that there was an abuse because the New South Wales proceedings were directed to obtaining an advantage for which the proceedings were not designed or beyond what the law allows, the submission is circular. To frame the alleged abuse in this way assumes rather than demonstrates that the proceedings have the character or consequence alleged. As already explained, the common starting point for all of the arguments that there was or would be an abuse of the process of the Supreme Court was that MWP's claims against the respondents in the Supreme Court were limited by the nature and extent of the relief it sought and obtained in the arbitration of its claims against Mr Emmott. That premise is flawed. Because it is flawed, this is not a case like Reichel v Magrath78 where, by its proceedings in the Supreme Court of New South Wales, MWP sought to set up the same case as was to be 76 (1981) 147 CLR 589. 77 (2001) 53 NSWLR 198. 78 (1889) 14 App Cas 665. Gummow ACJ Hayne Crennan Bell heard and determined in the arbitration. Because it is flawed, neither the institution nor the prosecution to judgment of the claims against the respondents was an abuse of process. Because it is flawed, execution of a judgment obtained against the respondents as knowing assistants of a breach of duty by Mr Emmott would not be an abuse, but would, as already explained, be subject to the equity that the respondents would have to prevent double recovery. The fact that the same transactions and events are the subject of two separate proceedings in different forums may raise a question about abuse of the process of one or other of those forums, but it does not lead inexorably to the conclusion that there is an abuse. There was no abuse in this case. Conclusion and orders For these reasons MWP's appeal must be allowed. There is no reason why the costs of the appeal to this Court should not follow the event. The parties did not agree what consequential orders should be made in that event. It was accepted that the matter must be remitted for further consideration by the Court of Appeal of grounds of appeal pleaded by the present respondents as appellants in that Court but not yet determined by the Court of Appeal. It was also accepted that the Court of Appeal has not yet determined MWP's cross-appeal to that Court and that the remitter should require consideration of that cross-appeal. The parties differed about whether the remitter should permit the respondents to argue in the Court of Appeal some further aspects of the question of abuse of process that were said not to have been dealt with by the Court of Appeal or raised for consideration in this Court. Given that the Court of Appeal's conclusions about abuse of process were put directly in issue by MWP's appeal to this Court and that the respondents did not seek to justify the conclusion reached or orders made by the Court of Appeal in that regard by reference to any of the matters which they now seek to reserve for further argument on remitter, the consequential orders made in this Court should not take the form the respondents advanced. The respondents should not be permitted, on the remitter, to argue afresh either of grounds 4 or 5(a) in their Amended Notice of Appeal in the Court of Appeal. There should, therefore, be consequential orders setting aside paragraphs 3, 4, 5, 6 and 7 of the orders of the Court of Appeal of the Supreme Court of New South Wales made on 15 September 2010 and remitting the matter for the further consideration by that Court of (a) grounds 5(b) to (c), 6 to 15, 17(b) to (d), 18, 20 and 21 of the Amended Notice of Appeal dated 7 May 2010, and (b) the Notice of Cross-Appeal dated 29 January 2010. The costs of the appeal to the Court of Appeal, including the costs of the hearing on remitter, should be in the discretion Gummow ACJ Hayne Crennan Bell of that Court. Money paid into Court by the appellant, in satisfaction of a condition of the grant of special leave, should be paid out to or at the direction of the appellant. 114 HEYDON J. The respondents did not allege that Einstein J had actually prejudged any issue. It is therefore necessary to put aside complaints which could go only to that question, for example, complaints that Einstein J "actively concealed" matters from the respondents or manifested various predispositions adverse to them. The respondents rather alleged that the circumstances created a reasonable apprehension of prejudgment. Of the six factors which the Court of Appeal saw as supporting that conclusion79, the first five are no more than pointers to possible legal error on the part of Einstein J. Similarly, among the arguments advanced by the respondents in support of the view that there was a reasonable apprehension of prejudgment were arguments that Einstein J had fallen into error in dealing with the ex parte applications which justified appellate intervention. Even if Einstein J had fallen into error, which he did not, that by itself would not support the conclusion that there was a reasonable apprehension of prejudgment. in relation The sixth of the Court of Appeal's six factors related to Einstein J's acceptance of Mr Wilson's evidence on the ex parte applications and the difficulty this could create if his credit were attacked at the trial. In other circumstances the process by which the supposed legal errors were made might have involved Einstein J in deciding facts in issue at the trial, or in assessing the credibility of persons later to give evidence at the trial. But in fact it did not in this case. That is so partly because none of the facts in issue at the trial were relevant to the ex parte applications. And it is so partly because the credit of Mr Wilson, who gave evidence those applications, was unchallenged. In view of the ex parte character of the applications, there was obviously no challenge from the respondents. The respondents did not allege that it was wrong for Einstein J to hear the ex parte applications made by the appellant. They did not allege that that by itself prevented Einstein J from presiding at the trial. Einstein J acted on the affidavit evidence of Mr Wilson on the ex parte applications. But nothing arose requiring Einstein J to accept Mr Wilson's credibility in the sense of making a positive choice between belief and disbelief in the face of material creating possible reasons for disbelief. An assessment of whether a fair-minded lay observer might reasonably apprehend that a judge might not bring an impartial mind to the resolution of the issues at the trial may include attribution to that observer of knowledge that judicial experience is a safeguard against the alleged danger that, having acted on a witness's unchallenged evidence given on one issue at an interlocutory stage, that judge might not fairly evaluate other evidence given by the witness at the trial on other issues, being evidence which was challenged at the trial and had to be 79 See above at [61]. weighed against that of the opposing witnesses, and that it is common for witnesses to be accepted on one issue but not others. Of course it is possible that in particular instances, despite that judicial experience, it should be concluded that there is a reasonable apprehension of prejudgment. It was not demonstrated that that conclusion should be drawn here. The same applies to the alleged danger that Einstein J's prolonged familiarity with the appellant's case gained during the ex parte applications might engender excessive knowledge of it, and, consciously or unconsciously, undue favour towards it in various ways. Therefore the allegation that there was a reasonable apprehension of prejudgment must, with respect to the Court of Appeal's careful reasoning, be rejected. It is accordingly not necessary to consider questions about whether there had been what was perhaps miscalled "waiver" by the respondents of any right to object to Einstein J hearing the trial, and about the correctness of Barton In relation to abuse of process – a part of the appeal which is yet a further reminder of the unwisdom of consenting to arbitration – I agree with the reasoning of Gummow ACJ, Hayne, Crennan and Bell JJ81. I agree too with the orders proposed. 80 [1979] 2 NSWLR 740. 81 Namely, at [91]-[110].

HIGH COURT OF AUSTRALIA APPELLANT AND DIRECTOR OF POLICE THROUGH THE SECRETARY OF JUSTICE AS DIRECTOR OF PUBLIC PROSECUTOR RESPONDENT Ruhani v Director of Police [2005] HCA 42 Date of order: 9 December 2004 Date of publication of reasons: 31 August 2005 Date of further orders: 31 August 2005 ORDER Made on 9 December 2004: The objection to the competency of the appeal is disallowed. Made on 31 August 2005: Motion seeking joinder of the Republic of Nauru and the Commonwealth of Australia dismissed. Appellant to pay the costs of the respondent of the motion. Respondent to pay the costs of the appellant of the objection to competency. Costs provided for in orders (2) and (3) be set off. On appeal from the Supreme Court of Nauru Representation: G Griffith QC with K L Walker and L G De Ferrari for the appellant (instructed by Vadarlis & Associates) P J Hanks QC with S J Lee and S P Donaghue for the respondent (instructed by Clayton Utz) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Ruhani v Director of Police Courts – High Court of Australia – Objection to competency – Whether High Court competent to hear and determine appeals from the Supreme Court of Nauru. Constitutional law (Cth) – Federal judicial power – Original jurisdiction of the High Court – Conferral of jurisdiction on the High Court to hear and determine appeals from the Supreme Court of Nauru – Nauru (High Court Appeals) Act 1976 (Cth) ("the Act") enacted to implement Agreement between Australia and Nauru relating to such appeals – Whether law conferring original jurisdiction on the High Court – Relevance of use of appellate nomenclature in the Act – Relevance of source and identity of rights and obligations to be adjudicated under the Act – Relevance of simultaneous creation and enforcement of rights in the Act – Whether proceedings brought in a matter arising under any law made by Parliament where rights and obligations defined by reference to law of another polity. Constitutional law (Cth) – Federal judicial power – Appellate jurisdiction of the High Court – Conferral of jurisdiction on the High Court to hear and determine appeals from the Supreme Court of Nauru – Whether the Act confers appellate jurisdiction on the High Court to hear such appeals – Whether such appeals heard by the High Court pursuant to s 73 of the Constitution – Whether s 73 of the Constitution exhaustively defines the appellate jurisdiction of the High Court. Constitutional law (Cth) – "External affairs" power – Relations of the Commonwealth with the islands of the Pacific – Whether Act validly confers appellate jurisdiction on the High Court in the exercise of legislative power with respect to external affairs or relations of the Commonwealth with the islands of the Pacific. Practice and procedure – Costs – Motion for indemnity costs – Commonwealth funding respondent's competency objection by way of indemnity arrangement – in proceedings concerning validity of Commonwealth did not appear Commonwealth legislation –Whether Commonwealth liable for costs on an indemnity basis. Practice and procedure – Motion for joinder – Whether Commonwealth or Republic of Nauru should be joined as a party – Whether High Court may order costs against non-party – Whether High Court should so order in circumstances of the case. Words and phrases – "appeals", "appellate jurisdiction", "original jurisdiction", "competency". Constitution, ss 51(xxix), 51(xxx), 73, 75(i), 76(ii). Judiciary Act 1903 (Cth), s 26. Migration Act 1958 (Cth), s 36. Nauru (High Court Appeals) Act 1976 (Cth), ss 4, 5. Nauru Independence Act 1967 (Cth), s 4. GLEESON CJ. Section 5 of the Nauru (High Court Appeals) Act 1976 (Cth) ("the Nauru Act") confers, or purports to confer, upon this Court jurisdiction to hear and determine appeals from the Supreme Court of Nauru in accordance with the terms of an Agreement between the Commonwealth of Australia and the Republic of Nauru. The historical background to the Agreement, and to the legislation, is explained in the reasons of other members of the Court. The appellant was unsuccessful in proceedings for habeas corpus brought by him against the respondent in the Supreme Court of Nauru. He appealed to this Court. An objection to the competency of the appeal was filed by the respondent. It was heard as a preliminary issue. The ground of objection was that s 5 of the Nauru Act is invalid. On 9 December 2004, the Court disallowed the objection to competency. The following are my reasons for joining in that order. The essential ground of invalidity asserted by the respondent was that s 5 of the Nauru Act purports to confer on this Court a form of judicial power that is extraneous to Ch III of the Constitution. The jurisdiction purportedly conferred is not jurisdiction to hear and determine an appeal of a kind referred to in s 73 of the Constitution. That is agreed. Nor, so it is submitted, is it original jurisdiction of a kind identified in s 75 or s 76. That is disputed. In particular, the appellant contends that what is involved is a conferral of original jurisdiction in a matter arising under a law made by the Parliament, within the meaning of s 76(ii). As an alternative to the s 76(ii) argument, the appellant also contended that, even if the jurisdiction conferred by the Nauru Act is not original jurisdiction of the kind referred to in s 75 or s 76, for the reason that it is appellate and not original in character, s 73 is not an exhaustive statement of the Parliament's power to confer appellate jurisdiction on this Court, and the Nauru Act validly confers appellate jurisdiction in the exercise of the legislative power given by s 51(xxix) (external affairs) and s 51(xxx) (relations with Pacific islands). This alternative argument, if it arose, would face the formidable obstacle of a long line of authority in this Court to the effect that Ch III of the Constitution (which, for present purposes, means ss 73, 75 and 76) "is an exhaustive statement of the manner in which the judicial power of the Commonwealth is or may be vested."1 The possibility that the powers conferred upon the Parliament by s 51 to make laws with respect to specified subjects might have included power to create courts with appropriate jurisdiction, beyond the kinds of jurisdiction referred to in Ch III, was rejected by Dixon CJ, McTiernan, Fullagar and Kitto JJ in R v Kirby; Ex parte Boilermakers' Society of Australia2. They said: 1 R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 at 270 per Dixon CJ, McTiernan, Fullagar and Kitto JJ. (1956) 94 CLR 254 at 269. "Had there been no Chap III in the Constitution it may be supposed that some at least of the legislative powers [conferred by s 51] would have been construed as extending to the creation of courts with jurisdictions appropriate to the subject matter of the power. This could hardly have been otherwise with the powers in respect of bankruptcy and insolvency to divorce and matrimonial causes (s 51(xvii)) and with respect (s 51(xxii)). The legislature would then have been under no limitations as to the tribunals to be set up or the tenure of the judicial officers by whom they might be constituted. But the existence in the Constitution of Chap III and the nature of the provisions it contains make it clear that no resort can be made to judicial power except under or in conformity with If the powers conferred by s 51(xxix) and s 51(xxx) extend to the conferral of a jurisdiction on this Court beyond jurisdiction of the kind envisaged in ss 73, 75 and 76, then it is difficult to see why they would not extend to the creation of a court of a kind altogether different from Ch III courts, and to the conferral of judicial power on such a court. If the powers given by s 51 extend to a power to confer jurisdiction, original or appellate, of a kind not envisaged by ss 71-80 (relevantly, ss 73, 75 and 76), then there seems no reason why they would be limited to power to confer such jurisdiction on a Ch III court. Section 122, concerning Territories, has been held at least to some extent to stand apart from this constitutional scheme, and the defence power has been held to extend to the creation of courts-martial, but it is difficult to apply the reasoning in support of those qualifications, if it be proper so to describe them, to the powers presently in question. The reason given for the received doctrine on this subject is that the affirmative words of Ch III granting power to create courts, confer the judicial power of the Commonwealth, and provide for the exercise of jurisdiction, carry a negative implication and "forbid the doing of the thing otherwise"3. That is "a proposition which has been repeatedly affirmed and acted upon by this Court"4. The discernment of such a negative implication in Art III of the United States Constitution, upon which Ch III was modelled, was fundamental to the reasoning of the Supreme Court of the United States in Marbury v Madison5. In that case Marshall CJ, speaking with reference to Art III's assignment of original and appellate jurisdiction, said6: 3 R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 at 270. 4 R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 at 270. 6 5 US 87 at 109 (1803). "Affirmative words are often, in their operation, negative of other objects than those affirmed; and in this case, a negative or exclusive sense must be given to them, or they have no operation at all." It is unnecessary to examine in greater detail the appellant's alternative argument. In my view, the appellant is correct in submitting that the power necessary to sustain the legislation is found in s 76(ii). Chapter III does not use the expression "appellate jurisdiction". That, however, is an expression that is commonly and conveniently used to describe the jurisdiction, conferred by s 73, to hear and determine appeals from certain specified courts within the Australian judicature. The present proceedings do not involve an appeal from any of those courts. The question is not whether, in some other context, or apart from any context, it would be more appropriate to describe the proceedings as appellate than to describe them as original. The question is whether, in the context of Ch III of the Constitution, it is appropriate to describe the jurisdiction conferred on this Court by the Nauru Act as original jurisdiction. The immediate context is s 76(ii), which refers to laws conferring original jurisdiction on the High Court in any matter arising under any laws made by the Parliament. The wider context is Ch III, and the constitutional scheme which has been referred to above in connection with the appellant's alternative argument. In answering the question, the first step is to identify the matter arising under a law made by the Parliament. The relevant law made by the Parliament is the Nauru Act. That is a law which, in its effect upon the rights and obligations of the parties, operates by reference to a law other than Commonwealth law. The content of the law to be applied by a court in the exercise of federal jurisdiction may be derived from some other law system. This happens, for example, when State law is "picked up" as "surrogate federal law" by reason of the operation of s 79 of the Judiciary Act 1903 (Cth)7. An otherwise valid law of the Parliament may pick up the law of Nauru as the law to be applied in determining rights and liabilities in issue in an exercise of federal jurisdiction. Furthermore, such a law may, in the one provision, both create a right and provide a remedy8. The circumstance that the proceedings in which this Court is empowered to review the decision of the Supreme Court of Nauru, and, if appropriate, set aside that decision and make consequential orders, are described as an appeal, (a 7 Austral Pacific Group Ltd (In liq) v Airservices Australia (2000) 203 CLR 136 at 8 R v Commonwealth Court of Conciliation and Arbitration; Ex parte Barrett (1945) 70 CLR 141; Hooper v Hooper (1955) 91 CLR 529 at 535-536. description which, from the point of view of the parties, is perfectly apt), does not determine the nature of the jurisdiction from the point of view of the Australian judicature for the purposes of Ch III of the Constitution. It is not uncommon for proceedings in a federal court, which involve a review of the decision of another decision maker, which are described in legislation as an appeal, and which from the point of view of the parties have the characteristics of an appeal, to involve, from the point of view of the Australian judicature, an exercise of original jurisdiction9. The power conferred upon this Court by the Nauru Act is a power to affirm, reverse or modify the judgment, decree, order or sentence of the Supreme Court of Nauru and to make such orders as should have been made or to remit the case for re-determination. That conferral of power by Australian legislation is made pursuant to the Agreement between the Commonwealth of Australia and the Republic of Nauru. In the present case, the litigation is against an officer of the Republic of Nauru, and questions of enforcement of any orders made by this Court involve relations between the two governments. There is no warrant for any assumption that such orders would be ineffective. There is a matter, that is to say, a controversy between the parties to the proceedings as to their respective rights and liabilities. It arises under a law made by the Parliament in the manner already described. Until the jurisdiction created by s 5 was invoked, the controversy did not involve any Australian law, and it had nothing to do with any part of the Australian judicature. Insofar as the controversy can now be said to arise under a law made by the Parliament, it does so only because the jurisdiction of an Australian court is invoked for the first time. So far as the Australian judicature is concerned, this is a new matter. In the context of Ch III of the Constitution, the jurisdiction invoked is original jurisdiction. For those reasons I joined in the order disallowing the objection to competency. For the reasons given by Gummow and Hayne JJ, I agree in the orders they propose respecting the motion for joinder and the costs of that motion and the objection to competency. 9 Watson v Federal Commissioner of Taxation (1953) 87 CLR 353 at 370-371; Farbenfabriken Bayer Aktiengesellschaft v Bayer Pharma Pty Ltd (1959) 101 CLR 652 at 657; Hembury v Chief of General Staff (1998) 193 CLR 641. McHugh 12 McHUGH J. The ultimate issue in this proceeding was whether the Nauru (High Court Appeals) Act 1976 (Cth) was a valid enactment of the Parliament of the Commonwealth giving this Court jurisdiction to hear and determine an appeal by the appellant against an order of the Supreme Court of Nauru. The issue arose because the respondent, the Director of Police for Nauru, objected to the competency of an appeal lodged in this Court by the appellant, Mr Mohammad Arif Ruhani. On 9 December 2004, this Court disallowed the Director's Notice of Objection to Competency. I joined in the order disallowing the objection to competency and now give my reasons for doing so. In my opinion, the Nauru (High Court Appeals) Act 1976 ("the Nauru Appeals Act") is a valid enactment of the federal Parliament and confers original jurisdiction on this Court to determine the "appeal". It is a law validly made under s 76(ii) of the Constitution which empowers the Parliament to "make laws conferring original jurisdiction on the High Court in any matter ... arising under any laws made by the Parliament". Accordingly, the appeal by Mr Ruhani was competent. Statement of the case Mr Ruhani is an Afghan national. By proceedings commenced in the Supreme Court of Nauru in April 2004, he sought the issue of a writ of habeas corpus directed to the Director of Police. He alleged that he was being held against his will by or on behalf of the Director of Police. In the Supreme Court of Nauru, Connell CJ granted an order nisi directing the Director to show cause why the order nisi should not be made absolute. After a hearing, Connell CJ dismissed the application for a writ of habeas corpus and ordered that the order nisi be discharged. By a Notice of Appeal filed in this Court, Mr Ruhani appeals from the judgment and order of the Supreme Court of Nauru. The material facts Mr Ruhani was brought to the Republic of Nauru on 21 December 2001 by Australian sea transport. The Australian Department of Immigration and Multicultural and Indigenous Affairs rejected his application for refugee status. Under a Memorandum of Understanding between Australia and Nauru10, accommodation for Mr Ruhani and other asylum seekers was established on 10 Memorandum of Understanding between Australia and Nauru for co-operation in the management of Asylum-seekers and related issues, dated 9 December 2002 and extended 25 February 2004. McHugh Nauru at two facilities: Topside and Former State House. Since February 2003 or earlier, Mr Ruhani has been detained in Topside Camp on Nauru. He neither applied for nor consented to the issue of a Nauruan visa for himself. Nor did he authorise any person to apply for a Nauruan visa on his behalf. Nevertheless, he was granted a Nauruan special purpose visa on 7 January 2002, which was subsequently extended at the request of the Australian Government. The International Organization for Migration ("the IOM") manages the facility where Mr Ruhani is detained and provides assistance in obtaining passports and travel documents to asylum seekers who elect to return to their country of origin. Mr Ruhani has not elected to return to his country of origin and has not requested assistance in applying for passports or travel documents from the IOM. Parties' submissions before this Court The Director objected to the competency of this Court to hear Mr Ruhani's "appeal" from the Supreme Court of Nauru. He contends that the Nauru Appeals Act is invalid because it purports to confer on this Court judicial power that is not part of the judicial power of the Commonwealth. The Director submitted that: The Nauru Appeals Act purports to confer appellate jurisdiction on this Court. Section 73 of the Constitution exhaustively defines the appellate jurisdiction of this Court (apart from possible supplementation under s 122 in relation to appeals from Territory courts), and does not authorise the appeal conferred by the Nauru Appeals Act. The Nauru Appeals Act is not supported by any head of legislative power capable of conferring additional jurisdiction on this Court. Alternatively, if the Nauru Appeals Act confers original jurisdiction on this Court, the Act is invalid. That is because the original jurisdiction of this Court is exhaustively defined by ss 75 and 76 of the Constitution and proceedings under the Nauru Appeals Act do not fall within those sections. Counsel for the Director conceded that there was at least one s 76(ii) "matter" arising under the Nauru Appeals Act, namely, the question of whether this Court can rule on the objection to competency. And there was another "matter": the appeal involved the interpretation of the Constitution11. As a result, the Director did not dispute that this Court has jurisdiction to determine the objection to competency. But he contended that the Court had no jurisdiction to determine the merits of the appeal. 11 Constitution, s 76(i). McHugh Counsel for Mr Ruhani contended that this Court has jurisdiction to hear the "appeal" on any one of three bases: original jurisdiction under s 76(ii) "in any matter … arising under any laws made by the Parliament". The source of the relevant law is either the external affairs power (s 51(xxix)) or the power of the Parliament to make laws with respect to the relations of the Commonwealth with the islands of the Pacific (s 51(xxx)); original jurisdiction under s 75(i) "[i]n all matters … arising under any treaty"; and appellate jurisdiction under the Nauru Appeals Act, which is authorised by the power conferred under either s 51(xxix) or s 51(xxx), and the exercise of which is unfettered by the operation of s 73. Background to the Nauru Appeals Act Historical relations between Nauru and Australia and the constitutional arrangements in Nauru with respect to the exercise of judicial power explain the enactment of the Nauru Appeals Act. An agreement made in 1976 between Nauru and Australia12 ("the 1976 Agreement") and the Nauru Appeals Act, which gave domestic effect in Australia to that Agreement, were products of an association between the two countries that extended back to the time of the First World War. This relationship gave rise to the unique provisions of the Act that purport to confer jurisdiction on this Court to hear "appeals" from decisions of the Supreme Court of Nauru. Germany annexed Nauru in 1888, following an agreement between the British and German Governments in 1886 that divided the Western Pacific into spheres of British and German influence13. Australian troops occupied and administered Nauru during the First World War14. The Versailles Conference in 1919 agreed to grant a mandate over Nauru to Governments of the British Empire. The effect of Art 22 of the Covenant of the League of Nations was to grant the mandate on 17 December 1920 to the sovereign of the United Kingdom, Australia and New Zealand. On 2 July 1919, the three nations 12 Australian Treaty Series, (1977), No 11. 13 Anghie, "'The Heart of My Home': Colonialism, Environmental Damage, and the Nauru Case", (1993) 34 Harvard International Law Journal 445 at 450. 14 Anghie, "'The Heart of My Home': Colonialism, Environmental Damage, and the Nauru Case", (1993) 34 Harvard International Law Journal 445 at 450. McHugh concluded an agreement that provided for the administration of Nauru by an Administrator ("the 1919 Agreement")15. Article 1 of the 1919 Agreement operated to vest the administration of Nauru in the Administrator and provided: "The Administrator shall have power to make ordinances for the peace, order and good government of the Island, subject to the terms of this Agreement, and particularly … to establish and appoint courts and magistrates with civil and criminal jurisdiction." The Nauru Island Agreement Act 1919 (Cth) was enacted to give effect to the Agreement. Exercising a power that Art 1 of the 1919 Agreement vested in the Australian Government, the Government appointed the first Administrator and all subsequent Administrators. Exercising the power conferred by Art 1 of the 1919 Agreement, the Administrator made the Judiciary Ordinance 1922. That Ordinance established a Central Court and a District Court. In 1947, Nauru was placed under the United Nations Trusteeship System, which succeeded the League of Nations Mandate System. Between 1947 and 1968, the Republic of Nauru was a United Nations Trust Territory. The Trusteeship Agreement for Nauru replaced the Nauru Mandate. Under the Trusteeship Agreement, the Governments of Australia, New Zealand and the United Kingdom undertook to jointly administer the Territory of Nauru. The administration of Nauru continued under an Administrator appointed by Australia. The Judiciary Ordinance 1957 ("the 1957 Ordinance") repealed all previous Ordinances and established a Court of Appeal as a superior court of record, a Central Court as a superior court of record, and a District Court. Under the 1957 Ordinance, appeals lay from the District Court to the Central Court, and from the Central Court to the Court of Appeal. The Court of Appeal consisted of a single judge who was or had been a Justice of this Court or of the Supreme Court of an Australian State or Territory. In 1965 an agreement was reached between the Governments of the United Kingdom, Australia and New Zealand in respect of the administration of the Trust Territory ("the 1965 Agreement")16. That Agreement provided for the establishment of legislative, executive and judicial branches of government. Under Art 5(1), a Central Court and a Court of Appeal were established "to replace the existing Central Court and Court of Appeal." Under Art 5(4), an appeal lay from a judgment of the Court of Appeal to this Court by leave of this Court. 15 Schedule to the Nauru Island Agreement Act 1919 (Cth). 16 Australian Treaty Series, (1965), No 20. McHugh The Nauru Act 1965 (Cth), which commenced on 18 December 1965, gave effect to the 1965 Agreement, as required under Art 6. Sections 47 and 49 of the Nauru Act 1965 established the Court of Appeal of the Island of Nauru and the Central Court of the Island of Nauru, respectively. Section 53 provided for the continued existence of the District Court of the Island of Nauru. Section 54 provided that appeals from the Court of Appeal of the Island of Nauru were to lie to this Court, upon leave of the High Court. In the Second Reading speech for the Nauru Bill 1965 (Cth) the Minister for Territories advised the House of Representatives that the provision for an appeal to this Court from decisions of the Court of Appeal was a new provision17. The United Nations General Assembly Resolution of 19 December 1967 resolved that the Trusteeship was to be terminated upon the accession of Nauru to independence on 31 January 196818. The Nauru Independence Act 1967 (Cth) ("the 1967 Act") repealed the Nauru Act 1965 and all Acts that extended to Nauru as a Territory of the Commonwealth as from 31 January 196819. The 1967 Act also provided that as from 31 January 1968, Australia was not to exercise any powers of legislation, administration or jurisdiction in and over Nauru20. The arrangements for appeals to this Court from the Court of Appeal ceased upon the commencement of the 1967 Act. Thus, only between 18 December 1965 and 30 January 1968 did appeals to this Court lie from the Court of Appeal. However, the Constitution of Nauru permits appeals from the Supreme Court of Nauru to a court of another country. Article 57(2) of the Constitution provides: "Parliament may provide that an appeal lies as prescribed by law from a judgment, decree, order or sentence of the Supreme Court to a court of another country." On 6 September 1976, Australia and Nauru concluded the 1976 Agreement, which provided for appeals to the High Court of Australia from the Supreme Court of Nauru in certain circumstances. As the recitals to the 1976 Agreement state, the Agreement sought to continue arrangements that had been 17 Australia, House of Representatives, Parliamentary Debates (Hansard), 2 December 1965 at 3501. 18 Resolution 2347 (XXII). 19 The 1967 Act, s 4(1). 20 The 1967 Act, s 4(2). McHugh in place between 18 December 1965 and 30 January 1968, prior to Nauru's independence: "Recalling that, immediately before Nauru became independent, the High Court of Australia was empowered, after leave of the High Court had first been obtained, to hear and determine appeals from all judgments, decrees, orders and sentences of the Court of Appeal of the Island of Nauru, other than judgments, decrees or orders given or made by consent". The Nauru Appeals Act The Nauru Appeals Act gives effect to the 1976 Agreement (the Agreement is appended in the Schedule)21. In the Second Reading speech, the Attorney-General, the Hon R J Ellicott QC, said the source of constitutional power for the Act was the external affairs power (s 51(xxix)) or the power of the Parliament to make laws with respect to the relationship between Australia and the islands of the Pacific (s 51(xxx))22. The Attorney-General recalled that under the legislation in force when Nauru was a Trust Territory an appeal lay by leave to this Court from the judgments, orders and decrees of the Nauru Court of Appeal. He told the House that23: "In the course of negotiations that preceded the independence of Nauru, the Nauruan leaders expressed a wish that provision be made for appeals to the High Court from certain judgments of the Supreme Court of Nauru that was to be established under that constitution. The Government is happy to accede to the desire of the Nauruan leaders and so to enter into the arrangements necessary for a suitable scheme for appeals to the High Court. … The Bill represents a novel and significant step in that for the first time the High Court will function as a final court of appeal from the Supreme Court of another independent sovereign country. … We have had, of course, to consider the source of constitutional power to enable the Parliament to enact the legislation and to confer the 21 Section 4. 22 Australia, House of Representatives, Parliamentary Debates (Hansard), 7 October 23 Australia, House of Representatives, Parliamentary Debates (Hansard), 7 October McHugh jurisdiction on the High Court. The High Court has held that it may have conferred on it appellate jurisdiction other than from the State courts, so long as there is a proper source of power for the Parliament to enact the legislation conferring the jurisdiction. A line of decisions [summarised by Menzies J in Capital TV and Appliances Pty Ltd v Falconer24] has established that the High Court may hear appeals from Territory courts. … In the present case, I believe that the external affairs power provides a sufficient constitutional basis for the Bill. Reference might also be made to the power of the Parliament to make laws with respect to the relations of the Commonwealth with the islands of the Pacific." Section 5 of the Nauru Appeals Act provides for "appeals" from the Supreme Court of Nauru to the High Court: "Appeals lie to the High Court of Australia from the Supreme Court of Nauru in cases where the [1976] Agreement provides that such appeals are to lie." Articles 1 and 2 of the 1976 Agreement set out the cases where "appeals" may and may not be brought to this Court. Sections 37 and 44 of the Appeals Act 1972 (Nauru), as amended by the Appeals (Amendment) Act 1974 (Nauru), permit a person to appeal to this Court in certain criminal and civil matters respectively. Those sections also confer jurisdiction on this Court to hear and determine those appeals. Some appeals lie to this Court as of right but, in other cases, leave to appeal is required. Section 51 of the Appeals Act 1972 (Nauru) provides for judgments and orders of this Court to have force and effect in Nauru as if they were judgments and orders of the Supreme Court of Nauru and to be given effect in Nauru accordingly. Only two reported cases have arisen out of the jurisdiction conferred by the Nauru Act on this Court25. Both concerned criminal matters. Three criminal appeals were lodged in 1998 but were later discontinued26. Until this case, this Court had not directly considered the validity of the Nauru Appeals Act. In Amoe v Director of Public Prosecutions (Nauru)27 and Director of Public Prosecutions (Nauru) v Fowler28, the Court did not refer to the issue of validity. 24 (1971) 125 CLR 591 at 604. 25 Director of Public Prosecutions (Nauru) v Fowler (1984) 154 CLR 627; Amoe v Director of Public Prosecutions (Nauru) (1991) 66 ALJR 29; 103 ALR 595. 26 Australian Law Reform Commission, The Judicial Power of the Commonwealth: A Review of the Judiciary Act 1903 and Related Legislation, Report No 92, (2001) 27 (1991) 66 ALJR 29; 103 ALR 595. 28 (1984) 154 CLR 627. McHugh Under the terms of the 1976 Agreement, there is an appeal to this Court as of right from the exercise of original jurisdiction by the Supreme Court of Nauru, even though the Supreme Court may itself have appellate jurisdiction29. In addition, a trial judge of the Supreme Court of Nauru may grant leave to appeal to this Court in relation to interlocutory civil judgments in the original jurisdiction of the Supreme Court of Nauru30. There is no equivalent right of appeal in relation to domestic appeals31. Jurisdiction conferred on this Court by the Nauru Appeals Act The outcome of this application turns on the characterisation of the jurisdiction that the Nauru Appeals Act purports to confer on this Court. The description of the proceeding as an "appeal" is not decisive. A classic description of an appeal is "the right of entering a superior Court, and invoking its aid and interposition to redress the error of the Court below"32. Appellate jurisdiction, therefore, implies that the subject matter has already been instituted in and acted upon by some other court whose judgment or proceedings are to be revised33. However, the description of an appeal that I have quoted appears to assume that the court below lies within the same curial system as the appellate court. And the implication to which I have referred is also inconclusive, because it does not address the situation where the "other court" lies outside the Australian curial system. Characterisation of the jurisdiction conferred on the Court by the Nauru Appeals Act is critical because it conditions the source of legislative power that supports the conferral of such jurisdiction. The problem is unique: on no other occasion has jurisdiction been conferred on this Court to hear "appeals" from a superior court of record of an independent sovereign nation. In this case, the problem of characterisation is a difficult one because the Nauru Appeals Act uses terminology that is consistent with the exercise of appellate jurisdiction, yet deals 29 1976 Agreement, Art 1A(a) and (b)(i). 30 1976 Agreement, Art 1A(b)(ii). 31 Australian Law Reform Commission, The Judicial Power of the Commonwealth: A Review of the Judiciary Act 1903 and Related Legislation, Report No 92, (2001) 32 Eastman v The Queen (2000) 203 CLR 1 at 33 [104] per McHugh J, citing Attorney-General v Sillem (1864) 10 HLC 704 at 724 [11 ER 1200 at 1209]. 33 See Story, Commentaries on the Constitution, 5th ed (1891), vol 2 at [1761]; Federal Commissioner of Taxation v Munro (1926) 38 CLR 153 at 174. McHugh with proceedings that, when they come before this Court, represent the first engagement of the judicial power of the Commonwealth. The literal meaning of many provisions of the Nauru Appeals Act suggests that the proceeding in this Court is an appeal in the true sense. The Nauru Appeals Act in s 5 speaks of "Appeals to [the] High Court" and provides that "[a]ppeals lie to the High Court of Australia from the Supreme Court of Nauru" in certain cases and that this Court "has jurisdiction to hear and determine appeals" in those cases34. Section 7 of the Act prescribes the quorum for the exercise of the "jurisdiction of the High Court to hear and determine an appeal or an application for leave to appeal under section 5". Section 8 provides for the form of judgment to be given by this Court "in the exercise of its appellate jurisdiction under section 5". The Act also provides that in the case of an appeal, where there is a difference of opinion and there is no majority of the one opinion, "the decision appealed from shall be affirmed."35 The literal meaning of various provisions of the Nauru Appeals Act suggests therefore that the jurisdiction exercised by this Court is appellate. However, the terminology used is not conclusive. The substance of the enactment determines whether this Court is being invested with original or appellate jurisdiction. In the old Taxation Board of Review "appeals", for example, this Court held that the "appeal" involved the exercise of the Court's original jurisdiction despite the legislation referring to an "appeal"36. So it is necessary to examine the substantive provisions of the Nauru Appeals Act to determine whether the jurisdiction is appellate or original. The powers of the Court, when exercising jurisdiction under s 5(2) of the Nauru Appeals Act, are consistent with the exercise of appellate jurisdiction. Examples are the powers of the Court under s 8 of the Nauru Appeals Act to "affirm, reverse or modify the judgment, decree, order or sentence appealed from and [to] give such judgment, make such order or decree or impose such sentence as ought to have been given, made or imposed in the first instance or remit the case for re-determination by the court of first instance, by way of a new trial or rehearing, in accordance with the directions of the High Court." These powers are similar to the power conferred on this Court in the exercise of its appellate jurisdiction by s 37 of the Judiciary Act 1903 (Cth) ("the Judiciary Act"), which provides for this Court to "affirm reverse or modify the judgment appealed from, and [to] give such judgment as ought to have been given in the first instance". 34 Nauru Appeals Act, s 5(1) and (2). 35 Nauru Appeals Act, s 9(b)(ii). 36 See, eg, Watson v Federal Commissioner of Taxation (1953) 87 CLR 353 at 371. McHugh Moreover, the power conferred by s 37 is different from that conferred on this Court in the exercise of its original jurisdiction by s 31 of the Judiciary Act. Section 31 provides for this Court to "make and pronounce all such judgments as are necessary for doing complete justice in any cause or matter pending before However, the difference between the powers conferred by ss 31 and 37 of the Judiciary Act is not a conclusive indicator that the Court exercises appellate jurisdiction when it uses the power of disposition conferred by the Nauru Appeals Act. The power conferred by s 8 is analogous to the powers of a court exercising original jurisdiction when it undertakes first-instance judicial review of an administrative decision. One such power is the power of remittal for re-determination in accordance with the directions of this Court. Further, this Court has held that s 196(1) of the 1951 consolidation of the Income Tax Assessment Act 1936 (Cth) (which was then entitled the Income Tax and Social Services Contribution Assessment Act) invoked the original jurisdiction of this Court, not its appellate jurisdiction37. Section 199(1) referred, in the context of the s 196 "appeal" from the Board of Review, to the power of the Court "by such order [to] confirm, reduce, increase or vary the assessment." This suggests that the powers conferred by s 8 are consistent with the exercise by this Court of original jurisdiction. They are not a conclusive indication that the Court is exercising appellate jurisdiction. The resolution of an "appeal" where the Justices sitting as a Full Court are divided in opinion as to the decision – "the decision appealed from shall be affirmed"38 – also points to the exercise of appellate rather than original jurisdiction. It contemplates that judgment may be given notwithstanding the absence of a majority of opinion. Nevertheless, this factor is also not conclusive. In some instances, despite the absence of a majority of opinion, this Court may give judgment in the exercise of its original jurisdiction. Section 23(2)(b) of the Judiciary Act provides that, when this Court sits as the Full Court in any case other than an appeal from a court listed in s 23(2)(a) (which arguably contemplates the exercise of original jurisdiction), if the Justices are divided in opinion as to the decision to be given on any question, and the Court is equally divided in opinion, "the opinion of the Chief Justice, or if he or she is absent the opinion of the Senior Justice present", prevails. Another matter consistent with the Nauru Appeals Act conferring appellate jurisdiction is that s 8 does not provide for the enforcement and execution of judgments, unlike ss 31 and 37 of the Judiciary Act. Counsel for the 37 See, eg, Watson v Federal Commissioner of Taxation (1953) 87 CLR 353 at 371. 38 Nauru Appeals Act, s 9(b)(ii). McHugh Director submitted that, if this Court is exercising original jurisdiction, then an essential characteristic of a "matter" is that there be a remedy enforceable in this Court. Counsel relied on statements by Gleeson CJ and myself in Abebe v The Commonwealth39. There we said that the existence of a "matter" "cannot be separated from the existence of a remedy to enforce the substantive right, duty or liability." We also said that "there must be a remedy enforceable in a court of justice, that it must be enforceable in the court in which the proceedings are commenced and that the person claiming the remedy must have sufficient interest in enforcing the right, duty or liability to make the controversy justiciable." However, courts may exercise judicial power and original jurisdiction even though no question of "enforcement", as such, arises. Making declarations, giving advice to trustees, receivers and liquidators and granting probate of wills or letters of administration are examples40. In addition, s 31 of the Judiciary Act may apply to an order of this Court exercising original jurisdiction under the Nauru Appeals Act. It would apply, for example, to a costs order, and such an order could be enforced in respect of any assets of a party within the jurisdiction. Section 31 would also apply to any other order, which Nauruan law would then pick up as a "datum" and apply in Nauru. The absence of any provision for the enforcement or execution of a judgment given under s 8 is inconclusive as to whether the jurisdiction is original or appellate. At all events, it does not preclude a conclusion that this Court exercises original jurisdiction when it hears an "appeal" under s 5. Counsel for the Director submitted that, in the absence of a relevant Nauruan law, an order directing the release of Mr Ruhani would not be enforceable and there would be nothing to make such an order enforceable in this Court. Again, however, that is not conclusive. Section 31 has application in such a situation. The courts of Nauru could pick up any judgment of this Court as a "datum" or a "fact" and apply it in Nauru. Another factor pointing to the jurisdiction under the Nauru Appeals Act being appellate is that the Supreme Court of Nauru is a superior court of record of unlimited jurisdiction. In the exercise of its original jurisdiction, this Court has power to set aside a judgment of a superior court of record, such as the Federal Court. However, it can do so only where, as in the case of the Federal Court41, the court is a court of limited jurisdiction. The Supreme Court of Nauru, 39 (1999) 197 CLR 510 at 528 [32]. 40 cf R v Davison (1954) 90 CLR 353 at 368. 41 Re Macks; Ex parte Saint (2000) 204 CLR 158. McHugh by contrast, is a superior court of record42 invested with the widest jurisdiction43, subject to some presently irrelevant exceptions. It is a central thesis of the common law that a superior court of record is assumed to have acted within jurisdiction (because it has jurisdiction to determine its own jurisdiction). As a result, its orders are binding until set aside on appeal. This factor suggests that the orders of the Supreme Court of Nauru are binding unless set aside on appeal and that any review of the orders of the Supreme Court of Nauru can only be an exercise of appellate jurisdiction. The authorities on which the Director relies in support of this contention, however, are concerned with decisions of superior courts of record within the same judicial hierarchy44. The review of decisions of a superior court of record of an independent sovereign nation raises quite different issues. As a result, the reasoning of the Court in those cases is not determinative of the present case and does not compel a conclusion that this Court exercises appellate jurisdiction under the Nauru Appeals Act. The foregoing discussion indicates that the terminology and the substance of the Nauru Appeals Act although consistent with appellate jurisdiction are not necessarily determinative of the class of jurisdiction exercised by the Court under the Act. What, if any, provisions of that Act or other matter indicate that the jurisdiction conferred by the Nauru Appeals Act is original jurisdiction? Counsel for the Director accepted that the term "original jurisdiction" in ss 75 and 76 of the Constitution may mean "the right to enter the jurisdiction of a court for the first time". And precedents in this Court support the proposition that the Court may be exercising original jurisdiction notwithstanding that the conferral of Those precedents – Farbenfabriken Bayer Aktiengesellschaft v Bayer Pharma Pty Ltd45, Watson v Federal Commissioner of Taxation46 and Pasini v United Mexican States47 – were concerned, however, with the review of decisions, not from courts or magistrates, but from persons, authorities or tribunals exercising administrative powers. In jurisdiction refers to an "appeal". 42 Constitution of Nauru, Art 48(1). 43 Courts Act 1972 (Nauru), s 17. 44 See, eg, Eastman v The Queen (2000) 203 CLR 1 at 32-33 [104] per McHugh J; Re Macks; Ex parte Saint (2000) 204 CLR 158 at 184 [49] per Gaudron J, 209-210 45 (1959) 101 CLR 652. 46 (1953) 87 CLR 353 at 371. 47 (2002) 209 CLR 246 at 253-254 [10]-[13] per Gleeson CJ, Gaudron, McHugh and McHugh those cases, there had been no exercise of judicial power of any kind until the so- called "appeal" was brought before a court exercising the judicial power of the Commonwealth. They invoked the original jurisdiction of the relevant court because it was the first time that the matter was brought into a court exercising judicial power. They are different from the present case in that in this case the matter has already been brought before a superior court exercising judicial power, albeit not the judicial power of the Commonwealth. A federal court may also exercise original jurisdiction even though the enactment conferring jurisdiction uses the nomenclature of "appeal" and the decision in respect of which review is sought involved the exercise of judicial power other than the judicial power of the Commonwealth. In Hembury v Chief of General Staff48, for example, this Court held that the Defence Force Discipline Appeals Act 1955 (Cth) conferred original jurisdiction on the Federal Court. Original jurisdiction was conferred despite s 52(3) of that Act conferring on the Federal Court "jurisdiction to hear and determine matters arising under this section with respect to which appeals are instituted in that Court". That Act also provided that such jurisdiction was to be exercised by that Court constituted as a Full Court. The decision in Hembury turned on the review of a decision of the Defence Force Discipline Appeal Tribunal, which is a body that exercises judicial power but not the judicial power of the Commonwealth. Thus, the exercise of original jurisdiction under s 76 of the Constitution is not confined to situations involving the first exercise of judicial power. For constitutional purposes, engagement with the judicial power of the Commonwealth (or the Australian curial system, if the Territories are included) for the first time is a powerful indicator that original jurisdiction under s 75 or s 76 of the Constitution is being exercised. Indeed, if a matter engages the judicial power of the Commonwealth for the first time, then the exercise by a court of federal jurisdiction in relation to that matter must be original jurisdiction unless the jurisdiction is exercised in accordance with s 73 of the Constitution. It is true, of course, that, when this Court exercises jurisdiction under s 73 of the Constitution in respect of State appeals, it is exercising appellate jurisdiction although it is the first time that the judicial power of the Commonwealth is engaged. But that is because such appeals fall within s 73. When the case is not within s 73 the jurisdiction of a federal court exercising the judicial power of the Commonwealth for the first time must be original jurisdiction. As no "matter" arises under the Nauru Appeals Act until proceedings are commenced in this Court, there is no exercise of the judicial power of the 48 (1998) 193 CLR 641 at 653-654 [31]-[33] per Gummow and Callinan JJ, citing Farbenfabriken Bayer Aktiengesellschaft v Bayer Pharma Pty Ltd (1959) 101 CLR 652 at 657 per Dixon CJ. McHugh Commonwealth until this Court exercises its jurisdiction in respect of such proceedings. And the jurisdiction to hear an "appeal" under the Nauru Appeals Act is not jurisdiction falling within s 73 of the Constitution. Thus, despite the use of the term "appeal" and the investment of powers consistent with appellate jurisdiction, the decisive factor in determining the nature of the jurisdiction is that only when an "appeal" under the Nauru Appeals Act is lodged is the judicial power of the Commonwealth engaged. And because the proceeding is not within s 73 of the Constitution it follows that the jurisdiction conferred is original jurisdiction. The Director's argument that the Nauru Appeals Act purports to confer appellate jurisdiction, contrary to s 73 of the Constitution, must therefore be rejected. Source of legislative power authorising the conferral of jurisdiction on this Court However, the fact that the Nauru Appeals Act invests original jurisdiction in this Court is not conclusive of its validity. A grant of original jurisdiction, to be valid, must confer jurisdiction in accordance with s 75 or s 76 of the Constitution. So, the next question for determination is whether the federal Parliament legislated in accordance with either or both of those sections when it conferred original jurisdiction on this Court to hear "appeals" from orders of the Supreme Court of Nauru. Mr Ruhani contended that original jurisdiction was validly conferred under s 76(ii) or, alternatively, s 75(i) of the Constitution. Under s 76(ii), the Parliament of the Commonwealth may confer original jurisdiction on this Court "in any matter … arising under any laws made by the Parliament". Under s 75(i), the Parliament may confer original jurisdiction "[i]n all matters … arising under any treaty". The requirement of "matter" Both ss 76(ii) and 75(i) require that there be a "matter" for the purposes of conferring original jurisdiction on this Court. This Court cannot exercise original jurisdiction if there is no "matter" in the constitutional sense. Whether or not a controversy is a "matter" is not always easy to decide. A proceeding is not itself a "matter" for constitutional purposes. Thus, the mere creation of a proceeding by legislation does not mean that the controversy to be resolved by the proceeding is a "matter … arising under" the relevant Act49. (If the mere creation 49 Collins v Charles Marshall Pty Ltd (1955) 92 CLR 529 at 557-558 per Taylor J. In Collins, this Court held s 31 of the Conciliation and Arbitration Act 1904 (Cth) invalid on the ground that it attempted to invest the Court of Conciliation and Arbitration with appellate jurisdiction from State courts exercising State jurisdiction. McHugh of a proceeding could give rise to a "matter … arising under" the relevant Act, there would be no work for s 76(ii) to do. The law conferring the jurisdiction would be the law under which the "matter" would arise.) In Abebe50, Gleeson CJ and I held that the term "matter" meant "subject matter for determination in a legal proceeding", that is, the "determination of rights, duties, liabilities and obligations in a legal proceeding", and not simply "legal proceeding"51. Gummow and Hayne JJ identified three elements that may be used to ascertain whether there is a "matter"52: "the subject matter for determination in a proceeding", the "right, duty or liability [that] is to be established" and "the controversy between the parties". In determining whether this Court has original jurisdiction under s 76(ii), it is therefore necessary to ascertain whether, firstly, the Nauru Appeals Act confers jurisdiction on this Court, and secondly, a "matter" arises under the Nauru Appeals Act. Similarly, in determining whether this Court has original jurisdiction under s 75(i), it is necessary to ascertain whether a "matter" arises under the 1976 Agreement. In this case, the determination of rights, liabilities and privileges of persons by reference to the law of Nauru is the subject matter of proceedings authorised by the Nauru Appeals Act. One view is that the controversy between the parties is the controversy as to whether the judgment of the Supreme Court of Nauru is right or wrong. Another view – and I think the better view – is that the controversy is whether the Nauruan Immigration Act and regulations made under it properly supported the special purpose visa and the conditions attached to the visa, according to the law of Nauru. On this view, the controversy is whether the grant of the visa and the conditions attaching to the visa were lawful under Nauruan law. Such a question involves the proper construction of the Nauruan Immigration Act and regulations and a determination as to whether the appellant is lawfully detained under that regime. The right, duty or liability to be established is the right of Mr Ruhani not to be unlawfully detained. An alternative formulation is that the Director of Police has a duty not to detain Mr Ruhani unlawfully as a matter of Nauruan law. This right of Mr Ruhani includes the right to have the correctness of the judgment of the Supreme Court of Nauru reviewed by this Court by reference to Nauruan law. The right also includes the right to a determination of the rights, liabilities and privileges of Nauruans by reference to Nauruan law. 50 (1999) 197 CLR 510. 51 Abebe (1999) 197 CLR 510 at 524 [24]. 52 Abebe (1999) 197 CLR 510 at 570-571 [165]. McHugh Section 76(ii) Two requirements must be satisfied before this Court can exercise original jurisdiction under s 76(ii). First, there must be a law conferring jurisdiction on this Court in a "matter". Second, that matter must be a "matter … arising under any laws made by the Parliament". The "matter" in the present case, as I have indicated, is the determination of the right of Mr Ruhani not to be detained unlawfully under Nauruan law. The Nauru Appeals Act confers jurisdiction on this Court in respect of that matter. But the ultimate question is whether the "matter" is one "arising under any laws made by the Parliament". An extensive body of case law has grown up around the question whether or not a "matter" arises under a law of the Parliament of the Commonwealth. One of the most authoritative statements on the issue is that of Latham CJ in R v Commonwealth Court of Conciliation and Arbitration; Ex parte Barrett53. There, his Honour said that a matter arises under a federal law: "if the right or duty in question in the matter owes its existence to Federal law or depends upon Federal law for its enforcement, whether or not the determination of the controversy involves the interpretation (or validity) of the law." Latham CJ did not regard it as essential that the matter depend on federal law for its enforcement as well as its existence; rather, it suffices if one or the other of the criteria was satisfied. Counsel for the Director correctly conceded that the original jurisdiction of this Court under s 76 of the Constitution can be supplemented by federal legislation. However, he submitted that there was no "matter … arising under" the Nauru Appeals Act upon which a conferral of jurisdiction could validly operate. He contended that the mere creation of a proceeding does not mean that the controversy to be resolved by the proceeding is a "matter … arising under" the relevant Act54. In this case the proceeding is a proceeding to determine whether the Supreme Court of Nauru erred. Counsel argued that the Nauru Appeals Act assumes that the relevant rights and duties to be adjudicated in this Court depend for their existence on the law of Nauru. Applying the tests 53 (1945) 70 CLR 141 at 154. 54 Citing Collins v Charles Marshall Pty Ltd (1955) 92 CLR 529 at 557-558 per McHugh articulated by the joint judgments of Gleeson CJ and myself and Gummow and Hayne JJ in Abebe, counsel submitted that the rights of the parties arise under Nauruan law, not Australian law. As the controversy arises under Nauruan law and only under Nauruan law, the "matter" is the controversy arising under Nauruan law. Accordingly, it could not be a "matter … arising under" the Nauru Appeals Act. That Act merely creates the remedy. It is not disputed that the rights and duties of the parties in this case are determined by reference to the terms of Nauruan law. Nor is it disputed that the terms of Nauruan law provide the basis for the subject matter of the proceeding between the parties under the Nauru Appeals Act. However, it is erroneous to suggest that the subject matter of the proceeding between the parties depends only on, and is wholly defined by, the law of Nauru. Sections 5(1), 5(2) and 8 of the Nauru Appeals Act provide a right to institute proceedings in this Court, confer jurisdiction on this Court to hear and determine such proceedings and create a "matter" or controversy between the parties under federal law to be determined by reference to the law of Nauru. Section 5(1) of the Nauru Appeals Act by implication confers a right to institute proceedings in this Court in certain instances, as it provides that "[a]ppeals lie to the High Court of Australia from the Supreme Court of Nauru". Section 5(2) confers jurisdiction on this Court to "hear and determine" proceedings brought under s 5(1). Section 8 confers remedies, the section empowering the Court to "affirm, reverse or modify" the judgment or order of the Supreme Court of Nauru, to "give such judgment [or] make such order … as ought to have been given [or] made … in the first instance" and to remit the case for re-determination in accordance with the directions of this Court. Although s 8 does not expressly say so, by necessary implication it directs this Court to apply the law of Nauru to determine the proceedings brought under s 5(1). To this end, the section operates to give Nauruan law the force of federal law for the purpose of determining the controversy. A "matter" therefore arises under a federal law for the purpose of s 76(ii) because the right or duty in question in this Court – ie, the right of Mr Ruhani not to be detained unlawfully and the duty of the Director of Police to detain persons lawfully – owes its existence to the Nauru Appeals Act. The subject matter of proceedings in respect of which this Court is invested with jurisdiction is defined by the Nauru Appeals Act. That Act identifies Nauruan law as the factum by reference to which the Act operates and Nauruan law as the law to be applied in the resolution of proceedings brought under the Act. This construction of the Act is supported by the words in s 8 that the Court may "give such judgment [or] make such order … as ought to have been given [or] made … in the first instance" (emphasis added). They imply that the Nauru Appeals Act – which is federal law – requires this Court to apply the terms of Nauruan law. The Act does not provide for this Court to give such judgment or make such order "as it deems fit", for example. Instead, the McHugh direction to give such judgment or make such order as ought to have been given or made in the first instance requires this Court to apply the law of that forum to determine the proceeding, which, in this case, is Nauruan law. The provision thus impliedly directs the Court to apply the law of Nauru in determining the controversy. Consequently, the Nauru Appeals Act has the effect of applying Nauruan law as federal law. By necessary implication, for the purpose of the "appeal", the Act gives effect to the law of Nauru as federal law. Nauruan law is applied to resolve the subject matter of the proceeding brought into this Court under the Nauru Appeals Act and, for the purposes of resolving the proceeding, Nauruan law is given the force of federal law. Nauruan law thus forms the factum that gives rise to federal rights. They include the right to have the correctness of the judgment of the Supreme Court of Nauru reviewed by this Court by reference to Nauruan law and the right to a determination of the rights, liabilities and privileges of Nauruans by reference to Nauruan law. The Court did this in Amoe v Director of Public Prosecutions (Nauru)55 and Director of Public Prosecutions (Nauru) v Fowler56 when it applied Nauruan criminal law to resolve appeals brought under the Nauru Appeals Act to this Court. There was no objection to jurisdiction in those cases. By giving Nauruan law the force of federal law for the purposes of a proceeding under the Nauru Appeals Act, that Act gives rise to the controversy and, hence, a "matter" for the purpose of s 76(ii). Several decisions of this Court – Hooper v Hooper57, LNC Industries Ltd v BMW (Australia) Ltd58, The Commonwealth v Evans Deakin Industries Ltd59 and Western Australia v The Commonwealth (Native Title Act Case)60 – support this construction of the Nauru Appeals Act. In Hooper, this Court rejected a challenge to the validity of the Matrimonial Causes Act 1945 (Cth) ("the Matrimonial Causes Act"). That Act purported to invest State and Territory courts with certain jurisdiction in relation to matrimonial causes and directed those courts to exercise the invested 55 (1991) 66 ALJR 29; 103 ALR 595. 56 (1984) 154 CLR 627. 57 (1955) 91 CLR 529. 58 (1983) 151 CLR 575. 59 (1986) 161 CLR 254. 60 (1995) 183 CLR 373 at 484-485. McHugh jurisdiction in accordance with the law of the State or Territory in which the person instituting the proceedings was domiciled. Part III of the Matrimonial Causes Act related to the "[i]nstitution of matrimonial causes by certain persons domiciled in Australia". Section 10(1) provided that a person resident but not domiciled in a State or Territory could "institute proceedings in any matrimonial cause in the Supreme Court of" the State or Territory of residence. Section 10(2) invested the Supreme Court of each State and Territory with federal jurisdiction to hear and determine such proceedings. Section 11 provided that the Supreme Court of the State or Territory was to exercise any jurisdiction with which it was invested under s 10 in accordance with the substantive law of the State or Territory in which the person instituting the proceedings was domiciled. This Court held that Pt III of the Matrimonial Causes Act gave the State laws the force of federal law. It also held that that Part conferred substantive rights, which, when put in suit, gave rise to a "matter … arising under" a law of the Parliament within the meaning of s 76(ii). There was a clear "enactment" of a substantive law of the Commonwealth by the adoption of the relevant State law for the purpose of the suit, and a direction to the forum to apply the substantive law of that State61: "In order to appreciate the real effect of Pt III of the Act, it is necessary to read s 10(1) with s 11, and s 10(2) is then seen as investing the Supreme Courts with the jurisdiction necessary to give effect to rights which are really created by s 10(1) and s 11. Section 10(1) says (to put it shortly) that, where a person is domiciled in one State but has been resident for one year in another State, he or she may institute a 'matrimonial cause' in the Supreme Court of that other State. This, in form, merely authorizes certain persons to take proceedings of a character defined in s 3. As a matter of substance, however, it confers rights, though it does not tell us precisely what those rights are. It is s 11 that tells us precisely what those rights are. They are the rights which the person mentioned in s 10(1) has according to the law of the State in which he or she is domiciled. A substantive 'law of the Commonwealth' is thus enacted, and, whenever a 'matrimonial cause' is instituted putting any of those rights in suit, there is a 'matter' which 'arises' under that law of the Commonwealth. And 'with respect to' that 'matter' State courts may be lawfully invested with federal jurisdiction under s 77(iii) of the Constitution. It is no answer to the above analysis to say that the right put in suit when a 'matrimonial cause' is instituted under the Act is a right created by State law – by the law of the State of the domicil. What the Act does is to 61 Hooper (1955) 91 CLR 529 at 536-537. McHugh give the force of federal law to the State law. The relevant law is administered in a suit instituted under the Act not because it has the the authority of a State, but because Commonwealth. For the purposes of the suit it is part of the law of the Commonwealth. The Act might, in s 11, have defined the rights to which effect was to be given in 'matrimonial causes' by enacting a system of its own. Or it might have defined those rights by reference to the law of England or the law of New Zealand or the law of one particular Australian State. The fact that it chose to adopt the law of the State of the domicil in each particular case cannot affect the substance of the matter." the authority of it has Nothing turned on the fact that the rights to which effect was to be given in "matrimonial causes" were those created by State law. The Court explicitly recognised that the Parliament might have defined those rights by reference to the laws of another polity, for example, the law of England or New Zealand. This obiter dictum supports the conclusion that the fact that the rights to which effect is given under the Nauru Appeals Act are defined by reference to the law of Nauru does not preclude the Act from operating to give those laws the force of federal law. A controversy arising under those laws therefore arises under the Nauru Appeals Act for the purposes of the conferral of jurisdiction on this Court. One difference between Hooper and the present case is that the Matrimonial Causes Act had the effect of changing rights in the provision that permitted or authorised its application. In contrast, the Nauru Appeals Act actually creates a right in the provision that permits or authorises its application. This difference is not significant. If legislation conferring rights is otherwise supported by a head of legislative power, the Parliament can create those rights by reference to the law of another polity. Unlike the Matrimonial Causes Act, the Nauru Appeals Act does not expressly direct the court in which jurisdiction is invested to apply the substantive law of a particular forum. The Nauru Appeals Act does not contain a provision that is directly comparable with s 11 of the Matrimonial Causes Act. The direction to the relevant State or Territory court to exercise the invested jurisdiction in accordance with the law of the State or Territory in which the person instituting the proceedings is domiciled was a clear adoption of the substantive law and a direction to the forum to apply the substantive law of that State or Territory. However, as I have indicated, as a matter of implication, the Nauru Appeals Act adopts the substantive law of Nauru as the substantive law by reference to which the rights and duties of the parties are to be ascertained. The Director contended that Hooper differed from the present case in that this case does not concern the application of, in effect, a choice of law rule. Rather, it involves reviewing the law of Nauru. According to this argument, the controversy remains one arising under the law of Nauru and not one arising under the law of the Commonwealth. However, on its proper construction, s 8 of McHugh the Nauru Appeals Act, by necessary implication, gives effect to the law of Nauru as federal law. The controversy is not simply one of reviewing or applying the law of Nauru or reviewing the correctness of the decision of the Supreme Court of Nauru. Such a conclusion necessarily follows from an examination of the powers conferred on this Court under s 8 of the Nauru Appeals Act to determine proceedings brought under the Act. The broad powers conferred by s 8 suggest that the Court does more than simply review the correctness of the decision of the Supreme Court or apply the law of Nauru. The Court is instead directed to determine the underlying controversy between the parties – in this case, the lawfulness of the appellant's detention. In LNC Industries Ltd, this Court held that a claim in a contractual dispute constituted a "matter" arising under a law of the Commonwealth in respect of which federal jurisdiction was engaged. The claim was framed as a claim for damages for breach of contract or for relief for breach of trust. It was common ground that such a controversy may arise under State law and relief may be available under State law. In this instance, however, the subject matter of the claim owed its existence to federal law. The rights and liabilities of the parties which could become the subject of a contract or trust existed only because of the operation of federal law. The relevant right was the right of a licensee who was permitted under the terms of the licence to import a certain number of motor vehicles to transfer that quota. Federal law and regulations established the licence and quota regimes. For constitutional purposes, a "matter" existed because the subject matter of the contracts and the action arose under and existed only by reason of the provisions of certain federal regulations and the federal Act under which the regulations were made. In their joint judgment, Gibbs CJ, Mason, Wilson, Brennan, Deane and Dawson JJ said62: "When it is said that a matter will arise under a law of the Parliament only if the right or duty in question in the matter owes its existence to a law of the Parliament that does not mean that the question depends on the form of the relief sought and on whether that relief depends on federal law. A claim for damages for breach or for specific performance of a contract, or a claim for relief for breach of trust, is a claim for relief of a kind which is available under State law, but if the contract or trust is in respect of a right or property which is the creation of federal law, the claim arises under federal law. The subject matter of the contract or trust in such a case exists as a result of the federal law." Counsel for the Director submitted that, as the content of the claim in LNC Industries Ltd derived from the regulation, it showed that some "federal" However, as Hooper controversy was required for a matter to arise. 62 LNC Industries Ltd (1983) 151 CLR 575 at 581. McHugh demonstrates, a "matter" owes its existence to federal law if the subject matter of the proceeding exists only because of the federal law. In LNC Industries Ltd, there could be no contract between the parties about the treatment of the import quotas in the absence of the federal regulations. But it does not follow that, for the purposes of identifying a "matter" that owes its existence to federal law, that subject matter must itself be a creature of federal law. If federal law adopts the law of another forum and gives effect to rights and liabilities under that law, there is a "matter … arising under" that law. Investing a court of federal jurisdiction with jurisdiction to determine a proceeding involving those rights and liabilities is investing it with jurisdiction in a "matter" arising under federal law. Evans Deakin Industries Ltd concerned a claim brought by a sub-contractor against the Commonwealth under the Subcontractors' Charges Act 1974 (Q). This Court held that, although s 64 of the Judiciary Act "does not subject the Commonwealth to the operation of State laws", it enabled "the provisions of State law [to] be the measure by reference to which rights and obligations are ascertained in suits to which s 64 applies"63. Evans Deakin Industries Ltd is an example of the assimilating capacity of ss 64 and 79 of the Judiciary Act. Those sections may apply in a way that gives rise to a controversy by reference to a law, in that case a State law, that is picked up and applied by operation of the federal Act. The result is an exercise of federal jurisdiction applying federal law. Evans Deakin Industries Ltd differs from the present case because the present case applies foreign law, but the effect is the same in character. In the joint judgment in the Native Title Act Case64, Mason CJ, Brennan, Deane, Toohey and Gaudron JJ and I held: "There can be no objection to the Commonwealth making a law by adopting as a law of the Commonwealth a text which emanates from a source other than the Parliament65. In such a case the text becomes, by adoption, a law of the Commonwealth and operates as such." 63 Evans Deakin Industries Ltd (1986) 161 CLR 254 at 268 per Brennan J, see also at 264 per Gibbs CJ, Mason, Wilson, Deane and Dawson JJ. 64 (1995) 183 CLR 373 at 484-485. 65 Hooper v Hooper (1955) 91 CLR 529 at 536-537. The law of the States that was picked up as a law of the Commonwealth in that case was statute law, not common law. Where a State statute is thus picked up and enacted as a law of the Commonwealth, the common law which has affected the construction of the text or has attached doctrines to its operation continues to have the same effect on the law (Footnote continues on next page) McHugh The difference between the Native Title Act Case and the present case is that in this case the Nauru Appeals Act purports to "adopt" Nauruan law, rather than the common law or the statute law of a State or Territory. However, as Hooper suggests, nothing turns on this point of distinction. Contrary to the submission of the Director, the finding that by necessary implication s 8 gives the force of federal law to Nauruan law does not create a risk that there would be no coincidence between the determination of this Court and the determination of the Supreme Court of Nauru. It is also incorrect to assume that this Court would not be making such order as ought to have been made below, but rather would be making such order as ought to be made under this adopted law of Australia. There is no disconformity between the law applied in the proceeding before this Court and the law applied in the Supreme Court of Nauru, because there is only a single law applied in this forum as federal law, and that is the law of Nauru. Reasonable minds may differ as to the interpretation and application of that law, but the body of law remains constant. Likewise, there is no risk that this Court would be required in the application of the law of Nauru to exercise jurisdiction that is fundamentally inconsistent with the exercise of federal jurisdiction or the discharge of the duties of a federal judicial officer. If a party brought an "appeal" to this Court in relation to Kable-type legislation66, for example, this Court would refuse to hear it on the basis that the power that the Court is being asked to exercise is incompatible with the integrity, independence and impartiality of this Court. In addition, such an "appeal" may involve a question of Nauruan constitutional law, in which case an appeal would not lie to this Court under the Nauru Appeals Act67. It is also immaterial for constitutional purposes that the Nauru Appeals Act, by operation of ss 5(1), 5(2) and 8, simultaneously creates a "matter", invests this Court with jurisdiction and provides for a remedy68. There can be no dispute that the Parliament is empowered to create a right and provide a remedy at the same time as it invests a court with jurisdiction in the matter. That much is of the Commonwealth as it has or had on the law of the State subject to contrary provision. 66 Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51. 67 Nauru Appeals Act, s 5 and Sched, Art 2(a). 68 See Barrett (1945) 70 CLR 141 at 165 per Dixon J; Hooper (1955) 91 CLR 529 at McHugh clear from the decisions of this Court in Barrett and Hooper. Latham CJ "[I]t is within the power of the Commonwealth Parliament, when legislating upon a subject matter within its constitutional competence, to provide that a court may make orders which are incidental to carrying into effect the legislative scheme, and that a proceeding to obtain such an order is a matter arising under the Federal law. A right is created by the provision that a court may make an order, and such a provision also gives jurisdiction to the court to make the order." Endorsing the approach of Latham CJ, in Hooper this Court accepted that a federal law may at once create a right and provide a remedy by providing that a person may take proceedings in a particular court to obtain a remedy70. It is also not decisive against the existence of a "matter … arising under" a law of the Commonwealth that the Nauru Appeals Act does not expressly provide for enforcement. Unlike the legislation considered in Hooper and Pasini, the Nauru Appeals Act does not expressly provide for the enforcement or execution of judgments or orders. Nevertheless, as Latham CJ acknowledged in Barrett, a matter may exist if the right or duty in question owes its existence to federal law or depends upon federal law for its enforcement. In any event, there is nothing to suggest that the Judiciary Act does not apply in relation to the enforcement in Australia of judgments or orders of this Court in proceedings brought under the Nauru Appeals Act. For example, a costs order may be enforceable within Australia against the assets of a party within the jurisdiction. It is true that the enforcement of some rights and liabilities ultimately depends on Nauruan law. To this end, Art 4(2) of the 1976 Agreement provides for orders of this Court "to be made binding and effective in Nauru." Section 51 of the Appeals Act 1972 (Nauru) provides for judgments and orders of this Court to "have force and effect in Nauru as if they were the judgment and orders of the Supreme Court [of Nauru]" and to be given effect in Nauru accordingly. But there has never been any objection to this Court making orders with respect to matters that can only be enforced out of the jurisdiction. Typically, there is some mutual enforcement or recognition provision, but even the absence of such a provision does not prevent this Court from exercising jurisdiction. As a result, the Nauru Appeals Act is a valid enactment of the federal Parliament that confers original jurisdiction on this Court in respect of a "matter" within the meaning of s 76(ii) of the Constitution. Having reached this 69 (1945) 70 CLR 141 at 155. 70 (1955) 91 CLR 529 at 535-536. McHugh conclusion, it is therefore unnecessary for me to consider whether original jurisdiction is also conferred on this Court under s 75(i). For these reasons, I joined in the order disallowing the Notice of Objection to Competency. The Director should pay the costs of the proceedings in respect to that objection. But I see no reason for making any of the additional orders sought by Mr Ruhani. There is no reason for thinking that the Director will not meet the costs order. In those circumstances, there is no ground for adding either Nauru or the Commonwealth as a party. And there is no case for an order for indemnity costs. The Director had a powerful argument to put in support of his competency objection. It was an objection that was well taken – although it was unsuccessful – in adversary litigation. Because that is so, it would be contrary to the practice of this Court to make an order for the payment of indemnity costs. GUMMOW AND HAYNE JJ. The appellant, an Afghan national, arrived in the Republic of Nauru on 21 December 2001. He was one of a number of "asylum seekers" brought to Nauru at that time by Australian sea transport. Facilities for the accommodation of these persons were established at two localities called "Topside" and "Former State House". By a proceeding instituted in the Supreme Court of Nauru in April 2004, the appellant alleged that he was held at "Topside" against his will by or on behalf of the Director of Police and he sought habeas corpus. The Supreme Court granted an order nisi but on the return the Supreme Court (Connell CJ) discharged the order nisi and dismissed the application. The Chief Justice delivered detailed and written reasons for that decision. By Notice of Appeal filed in this Court on 2 July 2004, the appellant appeals from the judgment and order of the Supreme Court of Nauru and seeks, inter alia, the relief refused by the Supreme Court. Reliance is placed for the jurisdiction of this Court upon the Nauru (High Court Appeals) Act 1976 (Cth) ("the Nauru Act"). The respondent has contended that this Court lacks jurisdiction to entertain the appeal because the Nauru Act is not a valid law of the Commonwealth. This Court has previously exercised, without objection to competency, jurisdiction under the Nauru Act in Director of Public Prosecutions (Nauru) v Fowler71 and Amoe v Director of Public Prosecutions (Nauru)72. The constitutional questions raised by the respondent are of considerable importance. Upon the answer given to them depends, in large measure, the scope for the provision by Australia of direct assistance in the operation of the judicial systems of other countries who seek that assistance. Particular provision for proceedings in this Court under the Nauru Act is made by O 70A of the High Court Rules73. Order 70A r 8 deals with objections to competency of an appeal and provides for the setting down of objections before a Full Court. The respondent's Notice of Objection to Competency of the appeal was dated 28 July 2004. The objection was resisted by the appellant. 71 (1984) 154 CLR 627. 72 (1991) 66 ALJR 29; 103 ALR 595. 73 These proceedings were commenced in the Court before the commencement of the High Court Rules 2004. The references to the High Court Rules are to the High Court Rules 1952 as in force at the relevant times. Given the assertion of invalidity of the Nauru Act, the controversy gave rise to a matter arising under the Constitution or involving its interpretation within the meaning of s 76(i) of the Constitution and s 30(a) of the Judiciary Act 1903 (Cth) ("the Judiciary Act"). It is that jurisdiction of which the Full Court presently has been seized. There was no intervention by the Attorney-General of the Commonwealth, on behalf of the Commonwealth, in exercise of the right conferred upon the first Law Officer of the Commonwealth by s 78A of the Judiciary Act. On 9 December 2004, the Court ordered that the objection to competency be disallowed and reserved all questions of costs. The appeal was then set down and heard on 19 April 2005 by a differently composed Bench. What follows are our reasons for joining in the disallowance of the objection to competency. We also deal in this judgment with the costs of that objection. Various provisions of the Nauru Act turn upon the definition of "Agreement" in s 3. This states: "In this Act, Agreement means the agreement between the Government of Australia and the Government of the Republic of Nauru relating to appeals to the High Court of Australia from the Supreme Court of Nauru that was signed on 6 September 1976, being the agreement a copy of the text of which is set out in the Schedule." The Agreement entered into force on 21 March 197774 and the Nauru Act commenced on that day75. Section 4 of the Nauru Act states: "The Agreement is approved." Before turning to consider the substantive provisions of the Agreement and the provisions of the Nauru Act which reflect the Agreement, two general points should be made concerning the Agreement. The first is that Art 6 provides for the continuation of the Agreement until the expiration of the ninetieth day after notice in writing is given by one Government to the other of its desire to terminate it. No such notice has been given by either Government. Secondly, the preamble to the Agreement includes the following: 74 Australian Treaty Series (1977), No 11. 75 Nauru Act, s 2. "Recalling that, immediately before Nauru became independent, the High Court of Australia was empowered, after leave of the High Court had first been obtained, to hear and determine appeals from all judgments, decrees, orders and sentences of the Court of Appeal of the Island of Nauru, other than judgments, decrees or orders given or made by consent, Taking into acount the desire of the Government of the Republic of Nauru that suitable provision now be made for appeals to the High Court of Australia from certain judgments, decrees, orders and sentences of the Supreme Court of Nauru". The reference to the state of affairs immediately before Nauru became independent is to the commencement of s 4 of the Nauru Independence Act 1967 (Cth) ("the Independence Act"). The effect of s 4 was that on the expiration of 30 January 1968, the day preceding Nauru Independence Day, all Acts of the Commonwealth extending to Nauru as a Territory of the Commonwealth ceased so to extend and the Nauru Act 1965 (Cth) ("the 1965 Act") was repealed; on and after Nauru Independence Day, Australia was not to exercise powers of legislation, administration or jurisdiction in and over Nauru. The preamble to the 1965 Act recited the approval by resolution dated 1 November 1947 of the General Assembly of the United Nations to the placing of the Territory of Nauru under the International Trusteeship system on terms set out in the Trusteeship Agreement, a copy of which was set out in the First Schedule to the 1965 Act76. Articles 2 and 4 of the Trusteeship Agreement designated the Governments of Australia, New Zealand and the United Kingdom as the joint Authority to exercise the administration of the Territory, with 76 The Trusteeship Agreement recited the earlier history of Nauru under a Mandate conferred upon His Britannic Majesty and said to be administered in accordance with the Covenant of the League of Nations by the Government of Australia on the joint behalf of the Governments of Australia, New Zealand and the United Kingdom. Australian legislation immediately before and during the Mandate period included the Nauru Island Agreement Act 1919 (Cth) and the Nauru Island Agreement Act 1932 (Cth). There is further consideration of the Mandate period and of the activities of the British Phosphate Commissioners on Nauru by Megarry V-C in Tito v Waddell (No 2) [1977] Ch 106 at 150-156, in the article by Dr Varsanyi, "The Independence of Nauru", (1968) 7 Australian Lawyer 161 and in two opinions by Sir Robert Garran reproduced as Opinion Nos 1029 and 1048 in Brazil (ed), Opinions of Attorneys-General of the Commonwealth of Australia, responsibility for the peace, order, good government and defence of the Territory77. the joint Authority The preamble to the 1965 Act also recited the entry by the three Governments constituting into an agreement dated 26 November 1965 which made further arrangements for the government of the Territory in accordance with the Trusteeship Agreement. A copy of this agreement was the Second Schedule to the 1965 Act. Article 3 thereof vested the administration of the Territory in an Administrator appointed by the Government of Australia. Article 5 provided for a court system, with an appeal to the High Court of Australia by leave of the High Court. It was in implementation of Art 5 that s 54 of the 1965 Act provided for the exercise of jurisdiction by the High Court to hear and determine, by leave, appeals from the Nauru Court of Appeal. It was this state of affairs which came to an end on the expiration of 30 January 1968, the day preceding Nauru Independence Day. In the Second Reading Speech on the Bill for the Nauru Act, the Attorney- General (Mr R J Ellicott QC) said78: "This Parliament, in the enactment of [the Independence Act], made provision for the final moves of the Nauruan people to the adoption of their own constitution. In the course of negotiations that preceded the independence of Nauru, the Nauruan leaders expressed a wish that provision be made for appeals to the High Court from certain judgments of the Supreme Court of Nauru that was to be established under that constitution. The Government is happy to accede to the desire of the Nauruan leaders and so to enter into the arrangements necessary for a suitable scheme for appeals to the High Court. Accordingly the terms of the necessary Agreement were discussed in detail between officers of the 2 governments and the Agreement was finally made at Nauru on 6 September 1976." We return to consideration of the Nauru Act. Section 5 provides: 77 The terms of the Mandate and then of the Trusteeship Agreement for New Guinea had directly identified the Commonwealth of Australia as sole mandate and trustee authority: Jolley v Mainka (1933) 49 CLR 242 at 273; Fishwick v Cleland (1960) 106 CLR 186 at 194-195. 78 Australia, House of Representatives, Parliamentary Debates (Hansard), 7 October "(1) Appeals lie to the High Court of Australia from the Supreme Court of Nauru in cases where the Agreement provides that such appeals are to lie. The High Court has jurisdiction to hear and determine appeals mentioned in subsection (1). (3) Where the Agreement provides that an appeal is to lie to the High Court of Australia from the Supreme Court of Nauru with the leave of the High Court, the High Court has jurisdiction to hear and determine an application for such leave." Section 5(1) directs attention to and derives its content from the adoption of Arts 1 and 2 of the Agreement. These state: "ARTICLE 1 Subject to Article 2 of this Agreement, appeals are to lie to the High Court of Australia from the Supreme Court of Nauru in the following cases: In respect of the exercise by the Supreme Court of Nauru of its original jurisdiction – In criminal cases – as of right, by a convicted person, against conviction or sentence. In civil cases – as of right, against any final judgment, decree or order; and (ii) with the leave of the trial judge or the High Court of Australia, against any other judgment, decree or order. In respect of the exercise by the Supreme Court of Nauru of its appellate jurisdiction – In both criminal and civil cases, with the leave of the High Court. ARTICLE 2 An appeal is not to lie to the High Court of Australia from the Supreme Court of Nauru – (a) where the appeal involves the interpretation or effect of the Constitution of Nauru; in respect of a determination of the Supreme Court of Nauru of a question concerning the right of a person to be, or to remain, a member of the Parliament of Nauru; in respect of a judgment, decree or order given or made by consent; in respect of appeals from the Nauru Lands Committee or any successor to that Committee that performs the functions presently performed by the Committee; or in a matter of a kind in respect of which a law in force in Nauru at the relevant time provides that an appeal is not to lie to the High Court." The jurisdiction of the High Court to hear and determine appeals and applications for leave under s 5 is to be exercised by a Full Court consisting of not less than two Justices (s 7). This is a law on its face supported by s 79 of the Constitution. This provides that the federal jurisdiction of any court may be exercised by such number of judges as the Parliament prescribes. Section 76(ii) of the Constitution requires more than a bare conferral of jurisdiction; there must be revealed a substantive law under which there arises the matters the subject of the conferral of jurisdiction. The appellant submits that s 5(2) and s 5(3), stating respectively that this Court has jurisdiction to hear and determine the appeals mentioned in s 5(1) and the leave applications mentioned in s 5(3), are laws made by the Parliament in exercise of its authority under s 76(ii) of the Constitution to make laws conferring original jurisdiction on the High Court in any matter "arising under any laws made by the Parliament". The appellant further submits that the relevant matters arise under federal law because they owe their existence to the adoption and translation into Australian law (by s 5(1) and s 5(3) of the Nauru Act) of Arts 1 and 2 of the Agreement. This statutory implementation of the Agreement is an exercise of the powers of the Parliament to make laws with respect to "external affairs" (s 51(xxix)) and "the relations of the Commonwealth with the islands of the Pacific" (s 51(xxx)). The rights and obligations in controversy and for determination in the matter are whether in a particular instance leave to appeal should be granted and, if so, and in cases of an appeal as of right, whether the judgment, decree, order or sentence appealed from should be affirmed, reversed or modified and consequential orders made as provided in s 8 of the Nauru Act. Section 8 will be set out below. These submissions by the appellant should be accepted and those put in opposition by the respondent should be rejected. The result is the conferral upon this Court of original jurisdiction as provided in s 76(ii) of the Constitution. Section 31 of the Judiciary Act makes general provision respecting judgments in the exercise of its original jurisdiction and the execution thereof. This is supplemented by s 8 of the Nauru Act, which provides that in the exercise of its "appellate jurisdiction" under s 5 of that Act, the High Court: "may affirm, reverse or modify the judgment, decree, order or sentence appealed from and may give such judgment, make such order or decree or impose such sentence as ought to have been given, made or imposed in the first instance or remit the case for re-determination by the court of first instance, by way of a new trial or rehearing, in accordance with the directions of the High Court". The Agreement speaks throughout, beginning with its heading, of "appeals" from the Supreme Court of Nauru to the High Court of Australia. Section 57(2) of The Constitution of Nauru, which came into force on Nauru Independence Day, states: "[The] Parliament [of Nauru] may provide that an appeal lies as prescribed by law from a judgment, decree, order or sentence of the Supreme Court to a court of another country." The Appeals (Amendment) Act 1974 (Nauru) amended the Appeals Act 1972 (Nauru) to provide for appeals from the Supreme Court to this Court, in terms later reflected in the Agreement. Hence it was to be expected that, in approving and implementing the Agreement, the Nauru Act would use the same appellate nomenclature adopted initially by and from the perspective of Nauruan law. However, the exercise of jurisdiction by this Court under the Nauru Act represents the first engagement in Australia of any judicial power. From that perspective, which, as a matter of Australian constitutional law and Ch III of the Constitution, is essential for a consideration of the Nauru Act, the jurisdiction is original in nature79. 79 cf Hembury v Chief of the General Staff (1998) 193 CLR 641 at 653-654 [31]-[33]; Pasini v United Mexican States (2002) 209 CLR 246 at 253-254 [10]-[13]. The use in the Nauru Act of appellate nomenclature does not require the contrary conclusion that what has been attempted in the Nauru Act is the addition of a new head of appellate jurisdiction outside the boundary of s 73 of the Constitution. Such an attempt would, as further mentioned hereunder, fail and a construction of the Nauru Act which sustains validity is to be preferred. It should be added that the use by the Parliament of the term "appeal" to identify what has been an exercise of this Court of original jurisdiction extends over a century. Early examples include the Patents Act 1903 (Cth) (s 58), the Land Tax Assessment Act 1910 (Cth) (s 44), and the Income Tax Assessment Act 1915 (Cth) (ss 37, 38). The case law has long established that the terminology adopted in such legislation has not been determinative of the character of the jurisdiction for the purposes of Ch III of the Constitution. Thus, in Minister of State for the Navy v Rae80, Dixon J remarked: "A Compensation Board [acting under the National Security (General) Regulations] cannot, under our constitutional system, exercise any of the judicial power of the Commonwealth. That power is brought into play for the first time when, on so called proceedings to review, the Court determines the compensation. They are in truth originating proceedings in the original jurisdiction, just as are the 'appeals' from the Commissioner of Taxation and from taxation Boards of Review and Valuation Boards." Nor is it a ground of objection to the validity of the Nauru Act that it performs a double function of creating and enforcing rights "in one blow"81. Federal laws drawn in that fashion have been held effective by a line of cases dealing with s 76(ii) of the Constitution. The cases commence with R v Commonwealth Court of Conciliation and Arbitration; Ex parte Barrett82 and are too numerous and too well known to warrant listing here. However, it will be necessary later in these reasons to refer to two of the cases, Hooper v Hooper83 and LNC Industries Ltd v BMW (Australia) Ltd84. 80 (1945) 70 CLR 339 at 340-341. See also Federal Commissioner of Taxation v Munro (1926) 38 CLR 153 at 181; Watson v Federal Commissioner of Taxation (1953) 87 CLR 353 at 370-371. 81 Fisher v Fisher (1986) 161 CLR 438 at 453. 82 (1945) 70 CLR 141. See Zines, Federal Jurisdiction in Australia, 3rd ed (2002) at 83 (1955) 91 CLR 529. 84 (1983) 151 CLR 575. The respondent contended that the rights and obligations to be adjudicated in this Court in exercising jurisdiction under the Nauru Act could not arise under a law of the Commonwealth because their source lay elsewhere, in the law in force in Nauru. That submission is to be rejected. Undoubtedly, from the constitutional perspective of Nauru, the source of the rights and obligations adjudicated in the Supreme Court of Nauru have their source in the law in force in the Republic of Nauru. But, as remarked above, in considering the Australian legislation, there is a change in perspective. A law made by the Parliament in exercise of a power in s 51 of the Constitution, here in pars (xxix) and (xxx), may answer the relevant constitutional description even though it defines rights and obligations by adoption of, or by reference to, the laws of another polity. The joint judgment in Hooper v Hooper indicates that this polity may be external to Australia. That case concerned the Matrimonial Causes Act 1945 (Cth) which provided for the exercise of federal jurisdiction in certain matrimonial causes, based on the residence of the petitioner, but with a provision by s 11 for the law of the State of domicile of the petitioner as the lex causae. Their Honours said in Hooper85: "It is no answer to the above analysis to say that the right put in suit when a 'matrimonial cause' is instituted under the Act is a right created by State law – by the law of the State of the domicil. What the Act does is to give the force of federal law to the State law. The relevant law is administered in a suit instituted under the Act not because it has the authority of a State, but because the Commonwealth. For the purposes of the suit it is part of the law of the Commonwealth. The Act might, in s 11, have defined the rights to which effect was to be given in 'matrimonial causes' by enacting a system of its own. Or it might have defined those rights by reference to the law of England or the law of New Zealand or the law of one particular Australian State. The fact that it chose to adopt the law of the State of the domicil in each particular case cannot affect the substance of the matter." the authority of it has The immediate right, duty or liability to be established by this Court in the exercise of jurisdiction conferred by the Nauru Act is the correctness of the determination by the Supreme Court of Nauru. Were it not for the initial operation of the Constitution and laws of Nauru there would have been no such determination and no occasion for the engagement of the Agreement and its 85 (1955) 91 CLR 529 at 536-537. implementation in Australian law by the Nauru Act. But without that federal law there would be no subject-matter for determination by this Court. Contrary to the respondent's submissions, it is not his case on the objection to competency but that of the appellant which draws support from authorities such as LNC Industries Ltd v BMW (Australia) Ltd86. The plaintiff in LNC sued in the Supreme Court of New South Wales upon an alleged agreement that the defendant would hold for the benefit of the plaintiff certain units of quota for the importation of passenger motor vehicles. The defences concerned contractual and trust issues but did not raise any question under the federal statute and regulations which established the import quota system. Nevertheless, the subject-matter of the contract and trust asserted by the plaintiff was entitlements which existed only as a result of federal law; the consequent exercise by the Supreme Court of federal jurisdiction rendered incompetent an attempted appeal directly to the Privy Council. In the present matter, the question whether the Supreme Court of Nauru erred in discharging the order nisi for habeas corpus would be answered in this Court by reference to the law in force in Nauru; but there is only a "matter" for determination in this Court as a result of the operation of the Nauru Act. For these reasons, the jurisdiction of this Court in the present appeal under the Nauru Act is supported by a law answering s 76(ii) of the Constitution. It is unnecessary to embark upon the reliance placed by the appellant in the alternative upon s 75(i) of the Constitution, dealing with matters "arising under any treaty". However, something more should be said respecting the appellate jurisdiction conferred by s 73 of the Constitution. The exhaustive and exclusive nature of the provisions of Ch III was recently confirmed by Re Wakim; Ex parte McNally87. As Gaudron J later remarked, decisions supporting the conferral of appellate jurisdiction on this Court by laws sustained purely by the Territories power in s 122 of the Constitution are not readily reconciled with that view of Ch III88. This is not an appropriate occasion to consider further the present state 86 (1983) 151 CLR 575. 87 (1999) 198 CLR 511. 88 Re Governor, Goulburn Correctional Centre; Ex parte Eastman (1999) 200 CLR of authority in this area89. It is sufficient to say that from submissions in the present case there appear no grounds of textual necessity or constitutional expediency which would warrant any distortion of Ch III beyond what may presently be required by the case law concerning s 122. For these reasons, we supported the disallowance of the objection to competency. There remains the question of costs of that objection. The appellant moves for an order joining the Republic of Nauru and the Commonwealth of Australia as parties to the proceeding and an order that those added parties pay the appellant's costs of the objection to competency taxed on an indemnity basis. Pursuant to the directions of a single Justice, the parties to the motion have filed their arguments in writing. There is no occasion to require or permit oral amplification of those arguments. The motion should be dismissed with costs. One of the arrangements recorded in the Memorandum of Understanding ("the MOU"), which is described more fully in the judgment of Gleeson CJ, Gummow, Hayne and Heydon JJ on the appeal itself90, was that Australia "will assume full financial responsibility for the administration of activities related to asylum seekers". The appellant tendered in evidence in support of his motion copies of some correspondence between the appellant's solicitor and the Australian Government Solicitor, solicitor for the Commonwealth. The Australian Government Solicitor informed the appellant's solicitor, by letter dated 7 December 2004, that "[u]nder the [MOU] between Australia and Nauru, the Commonwealth will meet any costs orders the respondent is ordered to pay in respect of the High Court proceedings" (identified earlier in that letter as proceedings number C8 of 2004 between Ruhani and the Director of Police). The appellant proffers no reason to doubt the accuracy or veracity of this statement by the Australian Government Solicitor which, in any event, appears to do no more than record the effect of the MOU. That the Commonwealth had agreed to meet the costs of the present litigation was apparent from at least the time that the affidavit exhibiting the MOU was filed in the Supreme Court. In these circumstances there is no occasion now to add parties to the proceeding and there is no reason to make 89 See Putland v The Queen (2004) 78 ALJR 440 at 447 [33]; 204 ALR 455 at 464; Zines, Federal Jurisdiction in Australia, 3rd ed (2002) at 186. 90 Ruhani v Director of Police [No 2] [2005] HCA 43 at [2], [9]. some special order for the costs of the objection to competency. The objection having failed, the respondent should pay the costs of the objection, but the appellant should pay the costs of the motion. These orders should be made respecting the objection to competency and the motion for joinder: (1) Motion seeking joinder of the Republic of Nauru and the Commonwealth of Australia dismissed. The appellant pay the costs of the respondent of the motion. The respondent pay the costs of the appellant of the objection to competency. The costs provided for in orders (2) and (3) be set off. Kirby 126 KIRBY J. These proceedings involve an objection to the competency of a purported appeal from a judgment and orders of the Supreme Court of Nauru91. A connected motion in relation to costs is also before the Court. The facts Mr Mohammad Arif Ruhani (the appellant) was one of three applicants for the issue of a writ of habeas corpus out of the Supreme Court of Nauru. The application was rejected in the decision now challenged in this Court. The appellant is an Afghan national who, with many others, wished to enter Australia, claiming protection under the Refugees Convention and Protocol92. However, he was intercepted at sea and taken to Nauru by a vessel of the Royal Australian Navy. He and 318 others in a like position were then kept (to use a neutral word) in Nauru, pursuant to intergovernmental arrangements between the Governments of Australia and Nauru, eventually expressed in a Memorandum of Understanding ("MoU")93. The other two applicants for habeas corpus were successively permitted to enter Australia. At the time these proceedings were heard by this Court, the appellant had not been given that permission. That is the background to his appeal. The proceedings in this Court were not mounted under the Australian Constitution, s 75(v), to engage the original jurisdiction of the Court in order to question the lawfulness of the actions of officers of the Commonwealth leading to the appellant's removal to Nauru; the execution of the MoU; the application of the legislation as it affected him94; or the role of the officers of the Commonwealth who, as the record shows, played a continuing part in Nauru in "managing" the appellant. Instead, the appellant claims to exercise rights afforded to him both under the law of Nauru and Australian federal law to bring 91 Mohammed Ali Amiri v Director of Police unreported, Supreme Court of Nauru, 15 June 2004 per Connell CJ ("Amiri"). 92 Convention relating to the Status of Refugees done at Geneva on 28 July 1951, [1954] Australian Treaty Series No 5; and the Protocol relating to the Status of Refugees done at New York on 31 January 1967, [1973] Australian Treaty Series No 37. See Migration Act 1958 (Cth), s 36. 93 Memorandum of Understanding between Australia and Nauru for Cooperation in the Management of Asylum Seekers and Related Issues signed on 9 December 2002 and extended by agreement on 25 February 2004. The MoU is discussed by Connell CJ in Amiri at [3]. 94 Border Protection (Validation and Enforcement Powers) Act 2001 (Cth). See Australian Communist Party v The Commonwealth (1951) 83 CLR 1; Vadarlis v Minister for Immigration and Multicultural Affairs (2001) 22(20) Leg Rep SL1. Kirby an appeal to this Court so as to challenge what are said to be errors in the determination by the Supreme Court of Nauru of the case that he brought to that Court challenging the lawfulness of his detention. Because of the nature of the process the appellant has initiated, and the challenge to the validity of that process brought by the Director of Police of Nauru (the respondent), it is unnecessary and would be inappropriate for this Court, at this stage, to consider the substantive merits of the appeal. On the face of things, the respondent's challenge to the competency of the appellant's proceedings presents a dry issue of Australian constitutional law, to be decided in accordance with the text of the Australian Constitution, read with such light as is cast by decisional authority. However, enough has been said about the facts to show that there are peculiarities that give this case more than a purely statutory connection to Australia. Such additional connections may arise in the relations between neighbouring States and the people in those States. They provide the factual setting in which the Australian constitutional questions now fall to be decided. Australian legal links with Nauru Colony and League mandate: Since 31 January 1968, Nauru has been an entirely independent nation. It is not part of the Australian Commonwealth. Specifically it is not an Australian Territory95. With the arrival of the European powers in the Pacific, Nauru was colonised by the German Empire96. Yet, even during this time, the company licensed to exploit the rich phosphate deposits of Nauru was the Pacific Phosphate Company, a corporation domiciled in Australia97. After the commencement of the First World War, Nauru was quickly occupied by an Australian military force. At the end of that war, the Australian Prime Minister called for the annexation of Nauru, as a conquered German colony98. However, after Germany ceded its overseas possessions, including 95 Constitution, s 122. 96 By the Anglo-German Declaration of 1886, signed at Berlin on 6 April 1886. See Varsanyi, "The Independence of Nauru", (1968) 7 The Australian Lawyer 161 at 97 Hunter Miller, The Drafting of the Covenant, (1928), vol 1 at 103. See Varsanyi, "The Independence of Nauru", (1968) 7 The Australian Lawyer 161 at 161. 98 Hunter Miller, The Drafting of the Covenant, (1928), vol 1 at 112. Hunter Miller described this view as "reactionary". See Varsanyi, "The Independence of Nauru", (1968) 7 The Australian Lawyer 161 at 161. Kirby Nauru, under the Versailles Treaty99, a mandate of the League of Nations to administer Nauru was conferred on "His Britannic Majesty"100. Pursuant to an agreement between the Governments of the United Kingdom, Australia and New Zealand ("the 1919 Agreement"), it was provided that Nauru should be administered, under the League mandate, by an Administrator nominated by the Australian Government. This tripartite agreement was subsequently confirmed by the Parliaments of the three nations concerned101. The Australian statute authorising the Australian part in the arrangement was the Nauru Island Agreement Act 1919 (Cth)102. Pursuant to Art 1 of the 1919 Agreement, given effect in this way, the Administrator was empowered to make ordinances (amongst other things) "to establish and appoint courts and magistrates with civil and criminal jurisdiction". A supplementary agreement of 1923103 between the three mandatory powers provided that the State appointing the Administrator should have the power to confirm or disallow ordinances made by the Administrator. In the result, because all of the Administrators of Nauru were appointed by Australia pursuant to the 1919 Agreement, the ultimate power over the content of Nauruan written law for the entire period of the League mandate rested with the Government of the Commonwealth of Australia. This position, under Australian law, reflected the fact that Nauru was classified by the League of Nations as a "Class C" mandate. Under the Covenant of the League104, such mandates were territories described as those that can be "best administered under the laws of the Mandatory as integral portions of its territory"105. That was the way Australia administered Nauru. 99 Art 119. 100 League of Nations, Doc 21/31/14A. See Varsanyi, "The Independence of Nauru", (1968) 7 The Australian Lawyer 161 at 161. 101 Varsanyi, "The Independence of Nauru", (1968) 7 The Australian Lawyer 161 at 102 See Anghie, "'The Heart of My Home': Colonialism, Environmental Damage, and the Nauru Case", (1993) 34 Harvard International Law Journal 445 at 450-452. 103 Approved by the Nauru Island Agreement Act 1932 (Cth). 104 Art 22. 105 Anghie, "'The Heart of My Home': Colonialism, Environmental Damage, and the Nauru Case", (1993) 34 Harvard International Law Journal 445 at 454-456. New Guinea, also a former colony of the German Empire and later a mandated territory, was a "Class C" mandate. As such, it was administered by Australia together with the Australian Territory of Papua. Kirby Pursuant to the powers so conferred, the Administrator of Nauru made ordinances which terminated the former jurisdiction of the courts of the German Empire106, and established courts and provided for an appeal from them to the Administrator107. These arrangements were not repealed until 1957 when the Judiciary Ordinance of Nauru of that year provided for the establishment of a Court of Appeal. That Court was to be "a superior court of record and consist... of one judge"108. Such judge was to be a person who "is, or has been, a justice of the High Court of the Commonwealth or of the Supreme Court of a State or Territory of the Commonwealth"109. In that way, for the first time, a formal link was envisaged between the judiciary of Nauru and a member, or former member, of the judiciary of Australia. United Nations trusteeship: Meantime, the constitutional status of Nauru had continued to evolve. After a short Japanese occupation during the Second World War110, Nauru, like other mandated territories, was brought under the supervision of the Trusteeship Council of the United Nations111. A tripartite trusteeship agreement was eventually approved by the Australian Parliament in the Nauru Act 1965 (Cth). That Act incorporated, in its Second Schedule, the Nauru Agreement of 1965 ("the 1965 Agreement"). The 1965 Agreement provided for the establishment of legislative, executive and judicial branches of government for Nauru. By Art 5(4) of the 1965 Agreement, an appeal was envisaged from the Court of Appeal of Nauru to this Court, with the leave of this Court112. It was thus, by the 1965 Agreement and the Nauru Act 1965 (Cth), that for the first time an institutional link was established by law between the judiciary of Nauru and the judiciary of the Commonwealth of Australia. 106 Judiciary Ordinance 1922 (Nauru) as amended by the Judiciary Ordinance Amendment 1925 (Nauru) and the Judiciary Ordinance Amendment Ordinance 1932 (Nauru). 107 Judiciary Ordinance 1922-1932 (Nauru), s 17. 108 Judiciary Ordinance 1957 (Nauru), s 27(1). 109 Judiciary Ordinance 1957 (Nauru), s 28(3). 110 Varsanyi, "The Independence of Nauru", (1968) 7 The Australian Lawyer 161 at 162. See also Weeramantry, Nauru: Environmental Damage Under International Trusteeship, (1992). 111 Pursuant to the Charter of the United Nations, Ch XII. See United Nations, General Assembly, Resolution 140(II) (1 November 1947). 112 See Nauru Act 1965 (Cth), s 54. Kirby In 1962, a United Nations mission sharply criticised the administration of Nauru113. It recommended that the earliest possible date be fixed for independence. In December 1967, the General Assembly of the United Nations resolved that the tripartite trusteeship over Nauru be terminated114. Independence and later links: By this stage the accession of Nauru to independence on Nauru Independence Day, 31 January 1968, had been decided115. By s 4 of the Nauru Independence Act 1967 (Cth) it was provided that, on the day immediately prior to that day, the Nauru Act 1965 (Cth) was repealed. On and after Independence Day, it was provided that "Australia shall not exercise any powers of legislation, administration or jurisdiction in and over Nauru"116. Although the Nauru Independence Act 1967 (Cth) severed the institutional links briefly created by the Nauru Act 1965 (Cth), and terminated any Australian jurisdiction in and over Nauru, the Constitution of Nauru envisaged that such institutional links might continue. By Art 57 of the Constitution of Nauru it is provided: "(1) Parliament may provide that an appeal lies as prescribed by law from a judgment, decree, order or sentence of the Supreme Court constituted by one judge to the Supreme Court constituted by not less than two judges. Parliament may provide that an appeal lies as prescribed by law from a judgment, decree, order or sentence of the Supreme Court to a court of another country." 113 United Nations, Visiting Mission to the Trust Territories of Nauru and New Guinea, Trusteeship Council, 29th Session, No 2, Report on Nauru, (1962) at 12. See Varsanyi, "The Independence of Nauru", (1968) 7 The Australian Lawyer 161 114 United Nations, General Assembly Resolution 2347 (XXII). See also Commonwealth of Australia Gazette, (1968) at 581 (the gazetted date for independence was 31 January 1968). 115 Nauru Independence Act 1967 (Cth). 116 Nauru Independence Act 1967 (Cth), s 4(2) (emphasis added). Kirby It was pursuant to Art 57(2) of the Nauru Constitution that the Parliament of Nauru, which is created by that Constitution117, later provided for further appeals from the Supreme Court that was likewise created by that Constitution118. It follows that, after Nauruan independence, Australia and Nauru were linked by history and experience but were completely independent nations in relation to each other. To achieve the institutional judicial link envisaged by the Constitution of Nauru, and desired by the Government of Nauru, it became necessary for Australia and Nauru to negotiate the new institutional link. Such negotiation took place. It resulted in a new agreement between the Government of Australia and the Government of the Republic of Nauru. This was signed on 6 September 1976 ("the 1976 Agreement"). Within Australia, approval of the Parliament for the 1976 Agreement was afforded by the Nauru (High Court Appeals) Act 1976 (Cth) ("the Nauru Appeals Act")119. The 1976 Agreement, which is reproduced in the Schedule to the Nauru Appeals Act, recites the position that had obtained before Nauru's independence whereby the High Court of Australia was empowered, after leave, to "hear and determine appeals from all judgments, decrees, orders and sentences of the Court of Appeal of the Island of Nauru". It also recites "the desire of the Government of the Republic of Nauru that suitable provision now be made for appeals to the High Court of Australia from certain judgments, decrees, orders and sentences of the Supreme Court of Nauru". Finally, it recites the "close and friendly relations between the two countries". The 1976 Agreement sets out the cases in which appeals are to lie to this Court120 and instances where an appeal is not to lie121. The latter include "where the appeal involves the interpretation or effect of the Constitution of Nauru"122. Provision is also made by the 1976 Agreement that orders of this Court, on appeals from the Supreme Court of Nauru, "are to be made binding and effective in Nauru"123. Provision is made for the ready termination of the 1976 117 Art 26. 118 Art 48. 120 The 1976 Agreement, Arts 1A and 1B. 121 The 1976 Agreement, Art 2. 122 The 1976 Agreement, Art 2(a). 123 The 1976 Agreement, Art 4(2). Kirby Agreement if that should be desired. Such termination is to take effect after the expiration of 90 days following a written notice of either Government of its desire to terminate the 1976 Agreement124. It was common ground in this appeal that at no time has either of the Governments concerned effected such a termination. Under the Appeals Act 1972 (Nauru), as amended125, the Parliament of Nauru had already made provision for appeals from the Supreme Court of Nauru to this Court. It did so in anticipation of (and in terms later confirmed by) the 1976 Agreement. By that Act, an "appeal" lies to "the High Court". The latter expression is defined as "the High Court of Australia established under the Constitution of Australia"126. For Australia, the Federal Parliament has made facilitating provisions in the Nauru Appeals Act, affording the right to appeal so far as Australian law is concerned. By s 7 of that Act it is provided that: "The jurisdiction of the High Court to hear and determine an appeal … under section 5 shall be exercised by a Full Court consisting of not less than 2 Justices." By s 8 of the Nauru Appeals Act, it is provided: "The High Court in the exercise of its appellate jurisdiction under section 5 may affirm, reverse or modify the judgment, decree, order or sentence appealed from and may give such judgment, make such order or decree or impose such sentence as ought to have been given, made or imposed in the first instance or remit the case for re-determination by the court of first instance, by way of a new trial or rehearing, in accordance with the directions of the High Court." It is pursuant to these enactments, respectively of the Parliaments of Nauru and of Australia, that the appellant has brought his appeal to this Court. He asserts the competency of this Court to hear and determine his proceedings in accordance with the foregoing laws. On the other hand, the respondent contends that the proceedings are incompetent by virtue of the Australian Constitution. It 124 The 1976 Agreement, Art 6(1). 125 Appeals (Amendment) Act 1974 (Nauru), s 10 inserting ss 44 and 45 in the Appeals Act 1972 (Nauru). 126 Appeals (Amendment) Act 1974 (Nauru), s 3(d) inserting a new definition in s 2 of the Appeals Act 1972 (Nauru). Kirby was not suggested that there is any relevant problem under the Nauruan Constitution or laws127. The respondent did not dispute that the determination of the issue of the competency of the appellant's proceedings presented a matter which, itself, properly engaged the jurisdiction and power of this Court. The appellant agreed in that proposition, treating the objection to the competency of the appeal as an aspect of valid proceedings in this Court. The issues Upon the questions argued the respondent's objection the competency of the appellant's appeal, the following issues arise: The character of the proceedings issue: What is the true character of the proceeding initiated in this Court for the purposes of Australian constitutional law? Is it truly an "appeal" as the 1976 Agreement, the legislation and the appellant's process assert? Or is it properly to be classified as an invocation of the original jurisdiction of this Court, although called an "appeal"? The s 73 issue: If the true character of the proceedings is an invocation of the appellate jurisdiction of this Court, is such an "appeal" permissible in accordance with the Australian Constitution, having regard to the terms of s 73 of the Constitution and any implications that arise from that section or from the language of the other provisions of Ch III of the Constitution and its structure? The s 75(i) issue: Having regard to the answers to (1) and (2), or in case those questions are answered unfavourably to the appellant, may the purported "appeal" from the judgment and orders of the Supreme Court of Nauru to this Court be treated as an invocation of the original jurisdiction of this Court pursuant to the self-executing provisions of s 75(i) of the Constitution because arising in a "matter" which itself arises under a treaty, namely the 1976 Agreement between Australia and Nauru envisaging the facility of "appeals" to this Court? The s 76(ii) issue: In case the foregoing questions are answered unfavourably to the appellant, is the jurisdiction of this Court in the 127 Under Nauruan legislation, the jurisdiction of this Court is enlivened by the Constitution of Nauru, Art 57(2) and the Appeals Act 1972 (Nauru) as amended. This jurisdiction is, however, limited: see Nauru Appeals Act, s 5(1) and the 1976 Agreement in the Schedule to that Act, Art 2. Kirby "appeal" correctly original jurisdiction conferred on this Court in a matter arising under "any laws made by the Parliament", namely the Nauru Appeals Act? Is it so to the extent that that Act picks up and gives effect, within this Court, to the law of Nauru applicable to the case? Would any such view of the "original jurisdiction" contradict implied limitations within s 76(ii) or elsewhere in Ch III of the Constitution, that would confine the exercise of such jurisdiction to "matters" apt to the judicial power of the Commonwealth, as distinct from the judicial power of a foreign State? The costs issue: In addition to the foregoing issues, as will appear, an issue arises as to the costs orders that should be made in disposing of the proceedings. The character of the proceedings is appellate Necessity of a neutral approach: The duty of a court established under Australian law, where possible, is to give effect to any federal legislation applicable to the proceedings. The power assigned to this Court by the Australian Constitution, to invalidate laws that do not conform to the Constitution, is a solemn one. It is one not to be ventured upon lightly. Amongst other things, this is because of respect due to the Federal Parliament as the palladium of the representative democracy that is a central feature of the Constitution. But it is also the case because of the checks that exist within the legislative and executive branches, against the enactment of unconstitutional laws. It is the outcome of the approach to challenges to constitutionality required in Australia both by statute128 and the common law129. Thus, it is a settled rule of Australian constitutional law that130: "If the choice is between reading a statutory provision in a way that will invalidate it and reading it in a way that will not, a court must always choose the latter course when it is reasonably open." This Court has taken that approach on many occasions, including where a challenge has been made to the conferral of appellate jurisdiction on this Court and other federal courts131. 128 Acts Interpretation Act 1901 (Cth), s 15A. 129 Residual Assco Group Ltd v Spalvins (2000) 202 CLR 629 at 644 [28]. 130 Residual Assco Group Ltd (2000) 202 CLR 629 at 644 [28]. 131 See eg Federal Commissioner of Taxation v Munro (1926) 38 CLR 153 at 181; Minister of State for the Navy v Rae (1945) 70 CLR 339 at 341. Kirby In discharging this constitutional function, when a party contends invalidity, there is obviously a limit to the extent to which this Court can re- express or re-interpret the words of the Parliament in order to avoid the rock of invalidity which those words appear to present. In every case of such a kind, it is a question of what is "reasonably open". A neutral application of its powers requires this Court to pay heed to this limit. The Court must approach the challenged law without presuppositions. This, in effect, was what the respondent asked this Court to do in taking the first step that he invited. That was to declare the true character of the jurisdiction invoked by the appellant's proceedings as "appellate" and not "original" jurisdiction for the purposes of the Australian Constitution. The respondent took this course because, on the basis of recent judicial observations132, such a conclusion presented a foundation for his submission of constitutional invalidity. Given that the Nauru Appeals Act, the 1976 Agreement and the process filed by the appellant all describe the proceedings undertaken in this case as an "appeal" – and hence suggest, or say, that the jurisdiction invoked is "appellate" – the correct starting point in these proceedings is the one chosen by the respondent. If Australian law purports to confer appellate jurisdiction on this Court, it is appropriate for this Court to assume that the Parliament knew, and intended to do, what it said it was doing. To assume otherwise is to start in quite the wrong place. Appellate jurisdiction – language: The respondent made a compelling argument that the jurisdiction invoked by the appellant in this Court is, for Australian constitutional purposes, appellate and not original. I accept the respondent's argument in this regard. With all respect, the contrary view cannot be reconciled with the language, history and purpose of the law and the character of the proceedings for which that law provides. The language of the Nauru Appeals Act is perfectly clear. Thus, s 5(2) of that Act purports to invest this Court with the jurisdiction to hear and determine "appeals", as defined133. So defined134, they are "[a]ppeals … from the Supreme 132 Gould v Brown (1998) 193 CLR 346 at 402 [63], 426-427 [131]-[132]; Northern Territory v GPAO (1999) 196 CLR 553 at 591-592 [92], 603 [125], 650-651 [256]- [257]; Re Wakim; Ex parte McNally (1999) 198 CLR 511 at 574-575 [111]; Re Governor, Goulburn Correctional Centre; Ex parte Eastman (1999) 200 CLR 322 134 s 5(1) (emphasis added). Kirby Court of Nauru in cases where the [1976] Agreement provides that such appeals are to lie". When reference is made to the 1976 Agreement135, it too talks of "appeals". By way of juxtaposition, such appeals are to lie to the "High Court" in respect of the exercise by the Supreme Court of Nauru of its "original jurisdiction". It is rare indeed (if it has ever happened) for an "appeal" to lie from the original jurisdiction of a Supreme Court of an independent nation to the original jurisdiction of this or any like court. The clearest indication that the jurisdiction so invested was intended to be "appellate" is found in s 8 of the Nauru Appeals Act. That Act, a statute of the Australian Parliament, describes the function which this Court is intended to exercise as "the exercise of its appellate jurisdiction"136. Moreover, the Act invokes the familiar language of appellate orders. Indeed, it describes the intended dispositions in terms taken directly from the Australian Constitution, s 73, the section described in the marginal note as dealing with the "[a]ppellate jurisdiction of High Court". Thus, the Nauru Appeals Act empowers this Court to affirm, reverse or modify the "judgment, decree, order or sentence" that is appealed from. This collection of determinations, typically made in the exercise of primary jurisdiction and subject to appellate correction, is that which appears in s 73 of the Australian Constitution itself. It can scarcely be imagined that, in drafting the Bill that became the Nauru Appeals Act and in enacting it, those responsible were unaware of the distinction drawn in the Australian Constitution between the "appellate jurisdiction" of this Court137 and its "original jurisdiction"138. Whilst the chosen language cannot determine conclusively the character of the jurisdiction, it would require an unreasonable alteration of the character of the jurisdiction expressed by the two legislatures to turn the language of appeals into the substance of original jurisdiction. Prudent conjuring with words is the stuff of constitutional interpretation. Magic belongs elsewhere. Appellate jurisdiction – history: Additionally, when the language of the Nauru Appeals Act is read against the background of its history, its effect, namely investing this Court with appellate jurisdiction, becomes still clearer. The history of the interrelationship between the exercise of the judicial power of Nauru and the personnel and institutions of the Australian executive 135 Art 1. 136 s 8 (emphasis added). 137 In s 73. 138 In ss 75, 76 and 77. Kirby and judicial branches of government139 discloses the gradual emergence of links to the Australian Judicature which were to be avowedly "appellate" in character. At first, an appeal lay to the Administrator who was an officer of the Australian Commonwealth. However, prior to Nauruan independence, as has been explained, a link was established with personnel of the superior Australian courts and later an institutional link with this Court. The last was extinguished upon independence. Then, as such, it was explicitly revived. Moreover, it was revived in terms of an international treaty, being the 1976 Agreement. This was an instrument between two independent nation States, negotiating with each other as legal equals. Whilst the task of characterising the jurisdiction conferred by the Nauru Appeals Act, an Australian federal law, falls for determination by this Court, it cannot be disconnected from its source in the 1976 Agreement. That Agreement did not envisage a relationship between this Court and the Supreme Court of Nauru on the footing that this Court would exercise "original jurisdiction" in relation to the Supreme Court of Nauru. It certainly did not provide, or envisage, that this Court would regard that Supreme Court effectively as a court of inferior jurisdiction subject to the "original jurisdiction" of this Court. On the contrary, the dignity and equality of the States parties which contracted the 1976 Agreement demanded nothing less than an appellate relationship between the two courts. So much was inherent in the fact that the Supreme Court of Nauru was, by the Constitution of Nauru, the highest court of that country. It enjoys the constitutional character of "a superior court of record"140. It is the final municipal court of an independent nation State. It has the statutory character of a court (subject to irrelevant exceptions) enjoying all of the jurisdiction vested in, or capable of being exercised by, the High Court of Justice in England as at the day of independence141. Whilst it is true that, within the Australian Commonwealth, judges of federal courts have been held to be subject to the original jurisdiction of this Court142, that is so only because, within the peculiar language of s 75(v) of the Constitution, such judges have been held to be "officers of the Commonwealth". 139 See above at [130]-[146]. 140 Constitution of Nauru, Art 48(1). 141 Courts Act 1972 (Nauru), s 17(2). See also Civil Procedure Act 1972 (Nauru), s 72 and Custom and Adopted Laws Act 1971 (Nauru), ss 4-6. 142 The Tramways Case [No 1] (1914) 18 CLR 54 at 62, 66-67, 82-83, 86; R v Commonwealth Court of Conciliation and Arbitration; Ex parte Ozone Theatres (Aust) Ltd (1949) 78 CLR 389 at 399. Kirby On no account is a judge of the Supreme Court of Nauru now to be so described. The Nauru Appeals Act must be read in the light of the 1976 Agreement and the status of the contracting parties to that Agreement. As such, it would be a distortion of language, and a misdescription of a serious kind, for this Court to hold that the jurisdiction conferred on it by that Act is "original" within the Australian Constitution. That would not only be contrary to the clear language and purpose of the Nauru Appeals Act, an Australian law. It would be contrary to the evolution of the jurisdiction of the Supreme Court of Nauru following Nauru's independence. For whatever Australian constitutional consequences may follow, the jurisdiction conferred is, as it says it is, "appellate". When the technical legal word "appeal" is used at such a high level of intergovernmental discourse and enactment, this Court should accept its use and give the word its technical meaning. Doing so is as important in a case of this kind as it is in construing the far less important provisions of purely local legislation143. Appellate jurisdiction – purpose: Nor are the powers afforded to this Court by the Nauru Appeals Act appropriate to the exercise of "original" jurisdiction. Had it been intended that this Court would exercise its original jurisdiction, other and different powers, such as the issue of the writs and other remedies of the kind mentioned in s 75 of the Constitution or in the Judiciary Act 1903 (Cth), would have been provided. Unsurprisingly, given the 1976 Agreement, the history, the language and the objects of the Nauru Appeals Act, the remedies afforded to this Court in relation to determinations of the Supreme Court of Nauru were, and were only, those appropriate to the exercise of its appellate jurisdiction. Nor is the language of the appellant's notice of appeal apt to an invocation of this Court's original jurisdiction. In terms, it invokes appellate jurisdiction. It seeks appellate remedies. There is no mention amongst the grounds of appeal of any suggested jurisdictional or like error by the Supreme Court of Nauru. Instead, the notice of appeal, as the 1976 Agreement and the Nauru Appeals Act contemplate, requests this Court to determine the legal merits of the matter as on an appeal which accepts that the same questions have been determined earlier by the Supreme Court of Nauru. Thus, the purpose of the Australian federal law and of the appellant's proceedings is to engage a legal process properly described as "appellate" not "original" in character. In The Tramways Case [No 1]144, Griffith CJ explained 143 cf Palgo Holdings Pty Ltd v Gowans (2005) 79 ALJR 1121 at 1127 [25]; 215 ALR 253 at 260, where the word "pawn" was given a technical meaning despite textual and contextual considerations suggesting the contrary. 144 (1914) 18 CLR 54 at 60-61 per Griffith CJ. See also at 64-65 per Barton J, 72-81 per Isaacs J, 82-83 per Gavan Duffy and Rich JJ, 83-85 per Powers J. Kirby the distinctiveness of appellate jurisdiction. He contrasted it with the purposes and character of original jurisdiction. The former involves a redetermination of the original cause between the same parties by examining the merits and correcting any error in the decision, of fact or law, as may be allowed. The latter is a new proceeding. Typically, it involves different parties. It ordinarily addresses some defect as to jurisdiction. As such, it is usually unconcerned with the merits of the case itself. Normally, its focus is process and conformity with legal powers. By these criteria, the purpose of the "appeal" afforded by the 1976 Agreement and the Nauru Appeals Act, and invoked by the appellant's process, is appellate. It is not an invocation of original jurisdiction. Appellate jurisdiction – true character: Against the background of this analysis, it is not really difficult to classify the proceedings invoked in this case. They are truly a step in an "appeal"145, just as they assert they are. They are designed to correct the errors of the court appealed from, the Supreme Court of Nauru, as a matter of legal substance. They are not, as such, designed to create a wholly new legal right, collateral to the earlier proceedings146. It is true that, occasionally, the Australian Federal Parliament, in a domestic context of federal law, has used the word "appeal", although conferring original jurisdiction, including on this Court147. Typically, such cases involve a review of decisions of persons or inferior tribunals carrying out administrative functions, where the matter is, for the first time, brought into a court that exercises judicial power148. The use of the word "appeal" in this context of jurisdictional subordination is familiar in Australian legal discourse. Indeed, it is acknowledged in federal statute law149. However, in the present context, given the explicit language of the 1976 Agreement and the Nauru Appeals Act, the history that lay behind those instruments, the purpose of the provision of an "appeal", the dignity of the States parties that agreed to it and the character of the jurisdiction that ensued, such local analogies are completely inapplicable. 145 Attorney-General v Sillem (1864) 10 HLC 704 at 724 [11 ER 1200 at 1209]; Victorian Stevedoring and General Contracting Co Pty Ltd and Meakes v Dignan (1931) 46 CLR 73 at 109; Eastman v The Queen (2000) 203 CLR 1 at 32-33 [104]. 146 R v Snow (1915) 20 CLR 315 at 322. See also Munro (1926) 38 CLR 153 at 196. 147 Hembury v Chief of General Staff (1998) 193 CLR 641 at 653 [31]; see also Munro (1926) 38 CLR 153 at 181. 148 cf Watson v Federal Commissioner of Taxation (1953) 87 CLR 353 at 371. 149 Federal Court of Australia Act 1976 (Cth), s 19. Kirby As the Supreme Court of a nation State, respected as independent by Australian law, recognised as such by international law, it is inadmissible to suggest that the judgments, decrees, orders and sentences of Nauru's Supreme Court would be made, or are, subject to this Court's original jurisdiction. This Court should not construe the 1976 Agreement to give effect to a result contrary to its language and purpose150. It should not do so because of imagined local constitutional difficulties with the contrary conclusion. If, in the interpretation of the Australian Constitution, this Court has taken (as it has) a strict view of the meaning of the word "appeal"151, why should it now adopt a different, contrary and malleable meaning for that notion as contemplated, in the context of the Nauruan Constitution, by its statute law – and by the international agreement made with Australia pursuant to such law? Why should it say that, in the latter context, unlike the former, "appeal" means a very different legal process with different consequences, namely an invocation of original jurisdiction? In the result, this Court should construe the Nauru Appeals Act so as to carry the 1976 Agreement into effect according to its terms and not so as to alter and rewrite the Act and the Agreement. Any such rewriting would involve this Court in an intrusion upon the governmental powers that belong to others, both in Nauru and Australia. Still less should we engage in a rewriting that denies the status of the Supreme Court of Nauru as a superior national court of record and thus insusceptible to another court's original jurisdiction, including that of this Court152. It may be true that in the text of the Australian Constitution the words "appellate jurisdiction" do not appear in Ch III153. However, the expression exists in the marginal note to s 73 ("Appellate jurisdiction of High Court"). And it appears there in contrast to the marginal note to s 75 ("Original jurisdiction of High Court"). The juxtaposition is plain and the remedies provided in s 73, and contemplated by s 75, are apt to each specified legal procedure. The remedies 150 Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476 at 492 [29]; Coleman v Power (2004) 78 ALJR 1166 at 1172 [19], 1209 [240]; 209 ALR 182 at 151 Eastman v The Queen (2000) 203 CLR 1 at 12-13 [17]-[18], 25-26 [75]-[76], 41 [131]-[133], 63 [190], 96-97 [290]; cf at 93 [277], 117-118 [356] and cases there cited. 152 Re Macks; Ex parte Saint (2000) 204 CLR 158 at 184 [49]; 209-210 [135]. 153 Reasons of Gleeson CJ at [7]. Kirby that are sought, and are apt, in this case are those proper, and only proper, to the exercise of appellate jurisdiction. It requires extended mental gymnastics to conclude otherwise. It is also true that appellate jurisdiction normally implies that the appellate court lies in the "same curial system" as the court a quo154. But as the availability of appeals to the Judicial Committee of the Privy Council long showed, that "same curial system" is a legal construct. It is defined by legal instruments. It may include the judicial institutions or personnel of another country or of several countries. A number of other appellate courts of the Commonwealth of Nations, present and superseded, demonstrate that this is so155. We should not needlessly demean the Supreme Court of Nauru by reducing its status to the equivalent of the former Australian Taxation Board of Review156, Valuation Boards157, or the Defence Force Discipline Appeal Tribunal158 which were or are not even courts. In this, I agree with what Callinan and Heydon JJ state in their reasons159. Conclusion: jurisdiction is appellate: It follows that I am confirmed in the view that I stated in Re Wakim; Ex parte McNally160. The jurisdiction conferred on this Court by the Nauru Appeals Act is "appellate in character". What is the consequence of this conclusion? The appeals named in s 73 are not exhaustive The respondent's case: On the basis of the foregoing classification, the respondent invoked a series of observations in this Court, some from its earliest days, suggesting that s 73 of the Constitution constitutes an exhaustive statement 154 Reasons of McHugh J at [38]. 155 Such as the newly created Caribbean Court of Justice established to replace appeals to the Privy Council. There may also be mentioned the former regional Commonwealth appellate courts in Africa, the East African Court of Appeal and the West African Court of Appeal, now defunct. 156 See reasons of McHugh J at [43]. 157 Reasons of Gummow and Hayne JJ at [110]. 158 Reasons of McHugh J at [50]. 159 Reasons of Callinan and Heydon JJ at [276]-[285]. 160 (1999) 198 CLR 511 at 608-609 [205]. Kirby of the Court's appellate jurisdiction161. Because there is no explicit provision in s 73 that envisages the conferral of appellate jurisdiction with respect to determinations of a court of a foreign nation, it follows (on the argument of the respondent) that the attempt by the Nauru Appeals Act to confer such jurisdiction on this Court had failed. On the foregoing premises, the respondent contested the capacity of the legislative powers invoked by the appellant to sustain the Nauru Appeals Act162. Such powers, like all of those in s 51, are expressed to be "subject to this Constitution". As such, they are subject to s 73 and Ch III. Section 73 does not afford the power to engage the appellate jurisdiction of this Court. When read with the rest of Ch III, a negative implication arises to exclude laws conferring federal jurisdiction beyond that stated in s 73. The submissions for the respondent draw, in this respect, upon many judicial opinions expressed during the history of this Court, most (but not all) in obiter dicta, inessential to the decision in question. This argument is by no means meritless. If one accepts the view that s 73 of the Constitution exclusively defines the "matters" which may be the subject of the exercise of appellate jurisdiction by this Court, the argument would be compelling. My conclusion that the jurisdiction provided for in the Nauru Appeals Act (and the 1976 Agreement) is appellate would then lead to the success of the respondent's submission and the dismissal of the appellant's purported appeal as incompetent by reason of incompatibility with the Australian Constitution. However, for a number of reasons I cannot agree with this second step in the respondent's argument. I do not agree that s 73 exhaustively defines this Court's appellate jurisdiction. In particular, I do not agree that the "appeals" specified in s 73 of the Australian Constitution represent the universe of the possible appellate jurisdiction of this Court, particularly where the Court is not exercising the judicial power of the Commonwealth as such. Moreover, I do not agree that Ch III of the Constitution contains the negative implications on which the respondent relied. 161 In re Judiciary and Navigation Acts (1921) 29 CLR 257 at 264; R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 at 268; Attorney- General (Cth) v The Queen (1957) 95 CLR 529 at 538; [1957] AC 288 at 312-313; Mellifont v Attorney-General (Q) (1991) 173 CLR 289 at 300. 162 Constitution, s 51(xxix) (external affairs), s 51(xxx) (islands of the Pacific) and s 51(xxxix) (matters incidental to execution of judicial powers). Kirby Section 73 is not exhaustive: The starting point must be the text of the Constitution. It, and not judicial expositions, expresses the law that governs this Court. In terms, s 73 is not expressed negatively. It does not state that this Court shall have jurisdiction in appeals "only" in the three categories mentioned (one of them, today, effectively a dead-letter163). This is a significant omission because, where the need for such a negative stipulation was felt, it was stated in the Constitution, as in the confinement of appeals under s 73(iii) "as to questions of law only" (emphasis added). Had it been the purpose of the Australian Constitution to restrict appeals to this Court to the three categories mentioned, and to them alone, the facultative language used would have been different. As Higgins J observed tellingly in Porter v The King; Ex parte Yee164: "Sec 73 may not give the jurisdiction to hear the appeal, but some other section of the Constitution may. Sec 73 does not say that the jurisdiction of the High Court on appeal shall be confined to appeals from the Courts mentioned in sec 73. It does not even say that 'the jurisdiction of the High Court shall be to hear appeals from the Courts' mentioned. The form of expression used is 'the High Court shall have jurisdiction' etc, just as if it were 'the High Court shall have a marshall'; this would not forbid other officers appointed under some other power." Since a number of the early opinions were written in this Court, to the effect that the specifications in s 73 of the Constitution are exhaustive, three pertinent developments have happened in constitutional exposition. Each is relevant to rebut the suggestion that s 73 is an exhaustive statement of this Court's appellate jurisdiction. First, courts are now much more cautious about the use of the expressio unius principle of construction generally and in the context of constitutional interpretation especially165. In giving meaning to a written text, but especially in a constitutional instrument expressed in brief terms the text of which has proved 163 Constitution, s 73(iii), appeals from "the Inter-State Commission, but as to questions of law only". 164 (1926) 37 CLR 432 at 446 noted in R v Kirby (1956) 94 CLR 254 at 290. See also on appeal Attorney-General (Cth) v The Queen (1957) 95 CLR 529 at 538; [1957] AC 288 at 312-313. 165 Re Wakim (1999) 198 CLR 511 at 605 [200] with reference to Russell v Russell (1976) 134 CLR 495 at 539; Houssein v Under Secretary of Industrial Relations and Technology (NSW) (1982) 148 CLR 88 at 94. Kirby difficult to change, it is now generally accepted that it is a mistake to infer that an affirmative catalogue necessarily excludes every other case. Secondly, the opinion that s 73 of the Australian Constitution was an "exhaustive" statement of the appellate jurisdiction first emerged in a time when the approach to statutory construction in this and other courts was highly literal. This Court was then subject to supervision by the Privy Council166, including in most constitutional matters. Since that time, appellate courts throughout the common law world167, including in this country168 and especially in constitutional matters169, have adopted contextual and purposive approaches to contested problems of legal interpretation. They have generally rejected the approach of verbal literalism. This profound change in the judicial approach to deriving the meaning of contested language needs to be kept in mind by contemporary judges when reading the constitutional expositions of their predecessors. It was natural for judges of this Court in earlier times to adopt a highly literalist approach to problems of constitutional interpretation. That was the approach to the judicial task then generally accepted and, in any case, enforced by the Privy Council. Today, we should be cautious about citing such approaches. They may not represent accurately the contemporary understanding of the law of the Australian Constitution or any national Constitution. Thirdly, this consideration has special significance for constitutional interpretation, more than a century after the adoption of the Australian Constitution. There are too many instances, including in recent cases, to deny the force of Professor P H Lane's observation that a change in the "interpretative method" of this Court on constitutional questions has occurred "from literalism and legalism to a kind of New Realism"170. Professor Lane detected, correctly in 166 Constitution, s 74. 167 eg Investors Compensation Scheme Ltd v West Bromwich Building Society [1998] 1 WLR 896 at 912-913 per Lord Hoffmann; [1998] 1 All ER 98 at 114-115. 168 Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 CLR 337 169 Bropho v Western Australia (1990) 171 CLR 1 at 20 approving Kingston v Keprose Pty Ltd (1987) 11 NSWLR 404 at 421-424. 170 Lane, Commentary on the Australian Constitution, 2nd ed (1997) at x. See also Sue v Hill (1999) 199 CLR 462; Shaw v Minister for Immigration and Multicultural Affairs (2003) 78 ALJR 203; 203 ALR 143; Singh v The Commonwealth (2004) 78 ALJR 1383; 209 ALR 355. Kirby my view, a "greater quest for the purpose in a constitutional provision and an invocation (in some quarters) of contemporary perceptions and values". In my opinion, this is no more than affording such a text a functional analysis. That is an analysis befitting the purpose of the Constitution as an enduring charter of government, necessarily adapting from age to age, within its language, to the needs of governance of the Australian Commonwealth171. When these basic changes of approach are recognised, and given effect, consistently and not selectively, they oblige the present judges of this Court to draw back from the suggestions made in earlier opinions that s 73 is an exhaustive statement of the Court's appellate jurisdiction. The section does not say that. The restraints that apply to the imposition of a restrictive implication172 persuade me that it would be a serious error to read s 73 in such a way. It was perhaps natural in the context of 1901 that the Australian Constitution did not expressly provide in s 73 for the conferral of jurisdiction upon this Court to hear and determine appeals from the judgments of courts of friendly countries beyond Australia, specifically in the Pacific Islands. In those days, such appeals, where they existed, would normally have gone to the Queen in Council, for which, in the Australian case, s 74 of the Constitution provided. But the facility eventually to provide for such appeals existed in s 51173. Only an expansion of a negative implication in Ch III would cut back the availability of that facility in Australia today. Given the need to harmonise the entire Australian Constitution, including ss 51 and 73, and to read the document as a whole and always as an instrument stating the principles of governance of an independent nation174, there are abundant reasons for avoiding the narrow view propounded by the respondent. It represents the breath of a bygone age which we should not continue to inflict on the Constitution without the soundest reasons for doing so. 171 Grain Pool of Western Australia v The Commonwealth (2000) 202 CLR 479 at 522-523 [111]; see also Inglis Clark, Studies in Australian Constitutional Law, 172 Amalgamated Society of Engineers v Adelaide Steamship Co Ltd (1920) 28 CLR 129 at 145, 151-152; cf The Commonwealth v Kreglinger & Fernau Ltd (1926) 37 CLR 393 at 413; Australian National Airways Pty Ltd v The Commonwealth (1945) 71 CLR 29 at 85; Melbourne Corporation v The Commonwealth (1947) 74 CLR 31 at 83; Victoria v The Commonwealth ("the Payroll Tax Case") (1971) 122 CLR 173 Constitution, s 51(xxix) and (xxx). 174 Gould (1998) 193 CLR 346 at 492-494 [304]-[310]. Kirby Section 73 – other exceptions: Moreover, despite repeated judicial affirmations that s 73 represents an exhaustive statement of the appellate jurisdiction of this Court, from the earliest days of the Commonwealth, this Court's practice has been to the contrary. Thus, the Court originally exercised jurisdiction under the Colonial Courts of Admiralty Act 1890 (Imp)175. It has twice exercised jurisdiction in Nauruan appeals176. Although it is true that jurisdiction in those appeals was not contested, it is a fundamental duty of every court, before entering upon the exercise of jurisdiction, to satisfy itself that such jurisdiction exists. This Court has said as much on many occasions177. Presumably, none of the learned Justices who took part in the earlier appeals saw any difficulty in the exercise of the jurisdiction called "appellate". In none of those appeals was an order conventional to the exercise of original jurisdiction made by this Court. The most important exception to the treatment of s 73 as an exhaustive statement of the appellate jurisdiction of this Court concerns the appeals from the Supreme Courts of the Australian Territories. Unless, derivatively, such courts are to be classified as "federal courts" (a view that has been denied at least when they are exercising the judicial power of the Territory concerned178), Territory appeals could not fall within any of the other categories expressly stated in s 73179. Yet the Federal Parliament has validly provided for appeals from Territory courts to this Court. Such appeals are regularly heard and determined. The judgments, decrees, orders and sentences of this Court are made in the disposition of such Territory appeals. 175 See, for example, John Sharp & Sons Ltd v The Katherine Mackall (1924) 34 CLR 420. This jurisdiction was repealed in relation to Australia by the Admiralty Act 1988 (Cth), s 44. 176 Director of Public Prosecutions (Nauru) v Fowler (1984) 154 CLR 627; Amoe v Director of Public Prosecutions (Nauru) (1991) 66 ALJR 29; 103 ALR 595. 177 The Federated Amalgamated Government Railway and Tramway Service Association v The New South Wales Railway Traffic Employés Association (1906) 4 CLR 488 at 495; Federated Engine-Drivers and Firemen's Association of Australasia v Broken Hill Proprietary Co Ltd (1911) 12 CLR 398 at 415. 178 GPAO (1999) 196 CLR 553 at 615-616 [168], 616-617 [170]. 179 Porter (1926) 37 CLR 432; Capital TV and Appliances Pty Ltd v Falconer (1971) 125 CLR 591. Kirby It is not an answer for the respondent, or anyone else, to say that the Territory "exception" is an anomaly that proves the general rule. Either s 73 of the Constitution expresses an exhaustive list or it does not. So long as Territory appeals continue to come to this Court, or to any other federal court within Ch III, they deny, upon this premise, the postulate of exhaustiveness. They are fatal, unless overturned, to the central plank of the second step in the argument of the respondent. They necessarily admit of categories of appeal to Ch III courts from courts beyond those specified in s 73(i) and (ii) of the Constitution. Disjoining Territory appeals from the integrated Judicature of the Australian nation, at this stage of the evolution of the Commonwealth, would be unthinkable. Only ultra-formalism and the narrowest literalism would embrace such an unnecessary and nationally disruptive consequence. True, narrow constitutional views have sometimes prevailed180. However, usually they have been avoided because of the functional approach now taken by this Court to basic questions of constitutional interpretation181. This is not a time, and this is not a subject matter, upon which to embrace such a gnarled and shackled view of the Australian Constitution. Section 73 – "judicial power of the Commonwealth": It is difficult to reconcile all of the case law on the meaning and operation of s 73 in the context of Ch III of the Constitution. One way of doing so was expounded for the appellant. This was to treat s 73, as appearing in Ch III, as an exposition of the structure and content of the "judicial power of the Commonwealth" (emphasis added), which is mentioned in s 71 at the outset of the Chapter. Upon this view, s 73 is designed to provide for this Court's appellate jurisdiction in all Australian federal matters the the exercise of Commonwealth. That includes in appeals from a single Justice of this Court and from federal and State courts as identified in s 73. judicial power of involving the It is true that this view might, with some exceptions, reconcile some of the judicial remarks in this Court with the practice observed in respect of appeals from Territory courts and others not expressly spelled out in s 73182. I do not exclude it. Upon this view, the purpose of s 73 is not to afford an exhaustive list 180 eg Re Wakim (1999) 198 CLR 511. 181 See, for example, Western Australia v The Commonwealth ("the Territory Senators Case [No 1]") (1975) 134 CLR 201; Queensland v The Commonwealth ("the Territory Senators Case [No 2]") (1977) 139 CLR 585. As to the need to give an ample construction to the Constitution, see Abebe v The Commonwealth (1999) 197 CLR 510 at 531 [41] per Gleeson CJ and McHugh J. 182 Gould (1998) 193 CLR 346 at 493-494 [307]-[309]. Kirby but to entrench minimum entitlements to appeal from courts of the several Australian polities (federal and State) viewed as making up the constituent units of the federation. Because appeals from the Supreme Court of a foreign country do not involve the hearing and determination of process from a judgment, decree, order or sentence made in the exercise of the judicial power of the Commonwealth, s 73 would be silent as to such jurisdiction. Nothing else in Ch III expressly forbids it. Whilst I acknowledge the force of this argument, it presents certain difficulties. This is so because, reading s 73 with today's eyes, I regard Territory courts as "other federal court[s]" within s 73(ii). I consider that, their jurisdiction and powers being ultimately traced to s 122 of the Australian Constitution and to federal law, such courts are at all times exercising "[t]he judicial power of the Commonwealth" within the Australian Constitution. Moreover, at least so far as Australian courts are concerned, even on an appeal from a foreign court, they would in my view probably be exercising, in part, the judicial power of the Commonwealth. They would do so because, unless forbidden expressly by s 73 or impliedly by the language of Ch III, part of that judicial power has been deployed for Australian (as well as Nauruan) purposes under s 51 of the Constitution. It is unnecessary to take this point further. I have considered whether I should subordinate my opinion about the meaning of s 73 of the Australian Constitution and the requirements of Ch III to the assertions that the section is an exhaustive statement of this Court's appellate jurisdiction. I have previously expressed my view on this issue183. For the moment, it is a minority one. In matters of ordinary public and private law, judges of this Court normally submit to the considered exposition of the law as stated by the majority184. However, in the interpretation of the fundamental law of the Constitution, a different rule prevails185. 183 Gould (1998) 193 CLR 346 at 491-496 [301]-[312]; Re Wakim (1999) 198 CLR 184 See, for example, Graham Barclay Oysters Pty Ltd v Ryan (2002) 211 CLR 540 at 626 [238] (with reference to the Caparo principle); D'Orta-Ekenaike v Victoria Legal Aid (2005) 79 ALJR 755 at 798 [242]; 214 ALR 92 at 152. 185 Queensland v The Commonwealth (1977) 139 CLR 585 at 593-594; Stevens v Head (1993) 176 CLR 433 at 461-462; Shaw (2003) 78 ALJR 203 at 217 [76]; 203 ALR 143 at 161-162; Coleman v Power (2004) 78 ALJR 1166 at 1219 [289]; 209 ALR 182 at 255; cf Singh (2004) 78 ALJR 1383 at 1437 [265]; 209 ALR 355 at Kirby Where the constitutional point is important, a judge of this Court may continue to give effect to a minority view the judge holds. Such, in my opinion, is the case here. The respondent's textual arguments are unconvincing. The assertions of exhaustiveness have admitted of several clear exceptions. The suggested negative implication fails by the test ordinarily deployed to sustain such implications186. The repetitions of the assertion arguably represent confirmations of interpretations adopted in an earlier time when a highly literalist approach to constitutional and statutory meaning was given effect. The earlier dicta have been insufficiently subjected to fresh scrutiny. There are, it is true, some negative implications to control the conferral of an appellate jurisdiction on this Court from the judgments, decrees, orders and sentences of courts of a foreign country. These include a prohibition on the conferral of jurisdiction that would violate the essential character of a court of the Australian Judicature to which the appeal was brought187. Similarly, it would be fundamentally inconsistent with Ch III of the Australian Constitution to endanger, in any way, the independence of such a court or to threaten to over- burden it, deflecting it from its constitutional and statutory functions in Australia. None of these dangers exists in the present case. Nor were they suggested. The appellant has withdrawn an argument that, potentially, would have involved this Court in the interpretation of the Constitution of Nauru188. With this, the respondent withdrew one ground of his objection to competency of the appeal based on Art 2(a) of the 1976 Agreement. These steps confined the objection to competency to the respondent's arguments based on the Australian Constitution. Conclusion – appellate jurisdiction is valid: The result of my analysis is that there is no express or implied limitation in s 73 of the Australian Constitution, or in any other part of Ch III, that forbids the conferral of the appellate jurisdiction contained in the Nauru Appeals Act. Once this conclusion is reached, there is no relevant restriction upon the enactment by the Australian Parliament of a law conferring jurisdiction and power upon this Court in terms of the Nauru Appeals Act. The legislative power 186 R v Kirby (1956) 94 CLR 254 at 292; Attorney-General (Cth) v The Queen (1957) 95 CLR 529 at 545; [1957] AC 288 at 320; Re Wakim (1999) 198 CLR 511 at 601 187 Gould (1998) 193 CLR 346 at 497 [319]. 188 Ground 6(b). Kirby so to provide appears in ample terms in s 51 of the Australian Constitution, notably in par (xxix) ("external affairs"); par (xxx) ("the relations of the Commonwealth with the islands of the Pacific"); and par (xxxix) ("matters incidental to the execution of any power vested by this Constitution in the Parliament … or in the Federal Judicature"). I have previously referred to the need for, and utility of, such an appellate jurisdiction189. The slightest familiarity with the involvement of Australia in attempts to strengthen the institutions of governance in Pacific countries, including in judicial and legal matters190, demonstrates the importance, both for Australia and for the neighbouring countries themselves, of such judicial links where they are mutually agreed on appropriate terms and conditions, as they were in the case of appeals from the Supreme Court of Nauru. The respondent's arguments, in respect of the ambit of the appellate jurisdiction of this Court, represented an attempt to press upon Ch III of the Australian Constitution a view about its capacity to adapt to succeeding ages akin to A D Hope's ironic description of Australia191: "They call her a young country, but they lie: She is the last of lands, the emptiest, A woman beyond her change of life, a breast Still tender but within the womb is dry." I decline to take such a view of s 73 or of Ch III of the Australian Constitution. That Constitution has proved resilient and generally adaptable to new times and new necessities. The present is simply the latest instance. The womb is not dry. The Australian Parliament is competent to provide for appeals to this Court from courts of neighbouring countries which agree to them, and to do so is, in the present age, beneficial for the purposes of the Commonwealth. Such appeals constitute a useful facility conducive to the advantage of Australia and to a neighbouring State – and to the rule of law and good governance in this region of the world. The provision of the facility is not alien to the legal tradition against which the Australian Constitution was written – on the contrary, it 189 Re Wakim (1999) 198 CLR 511 at 610 [208]. 190 Australia, Australian Agency for International Development (AusAID), Good Governance: Guiding Principles for Implementation, (2000); Australia, AusAID, Twelfth Annual Statement to Parliament on Australia's Development Cooperation Program, (2003) at 8. 191 From "Australia" (1939), reproduced in Ferguson et al (eds), The Norton Anthology of Poetry, 4th ed (1996) at 1373-1374. Kirby conforms to that tradition, adapting it to the present age. It is valid under the Australian Constitution. Intention of founders not determinative: The question is not, with respect, whether the founders of the Australian Commonwealth "considered it necessary, or desirable, to make provision for the bringing of appeals to [this] Court from another dominion or colony of the Empire, let alone from a foreign country"192. Such an approach would forever yoke the Australian Constitution to the intentions and expectations of men of the nineteenth century. Those men neither claimed, nor sought to enjoy, such a power193. The question is rather whether the words which they proposed, which the electors endorsed and which the people of Australia as sovereign accept as the basic law, permit the adaptation that today's governmental needs have produced in a law propounded as constitutionally valid. No other approach is compatible with the way this Court has interpreted and applied the Constitution. This case is not an occasion to change course. The invocation of original jurisdiction is inapplicable Original jurisdiction inapplicable: The objection to competency therefore failed on the foregoing grounds. The proceedings are an "appeal". They permissibly invoke the appellate jurisdiction of this Court. They do not, may not, and do not purport to involve the original jurisdiction of the Court. They are not analogous to proceedings within federal domestic jurisdiction in Australia that are called "appeals" but which are not truly so in their character. Only a strained characterisation of the appellant's process would sustain the application of such a municipal analogy. This being the case, it was unnecessary for me, in order to arrive at my orders, to consider what might have been the case if, contrary to my opinion, the appellant's process was not an "appeal" and the Nauru Appeals Act provided for the invocation of the original jurisdiction of this Court. I shall refrain from adding excessive remarks on an hypothesis with which I strongly disagree. Hypothesis of original jurisdiction: Nevertheless, because other members of this Court have elected to reverse the sequence in which the respondent advanced his objection to the competency of the appeal194, I will add some 192 Reasons of Callinan and Heydon JJ at [286]. 193 Re Wakim (1999) 198 CLR 511 at 599-600 [186]-[187]; see also Inglis Clark, Studies in Australian Constitutional Law, (1901) at 21; Grain Pool (2000) 202 CLR 479 at 522-523 [110]-[112]. 194 Reasons of Gummow and Hayne JJ at [118]. Kirby observations on the hypothesis of an invocation of original jurisdiction. Doing so may be prudent, given the interpretation of s 73 that presently enjoys majority support in this Court. The s 75(i) contention: Gleeson CJ, McHugh J, and Gummow and Hayne JJ find it unnecessary to embark upon the appellant's reliance on s 75(i) of the Constitution concerned with the jurisdiction expressly conferred on this Court "[i]n all matters ... arising under any treaty". In the present case, the appellant suggested that this self-executing conferral of original jurisdiction applied because, albeit indirectly, the "matter" constituted by the substantive controversy between the appellant and respondent arose under the 1976 Agreement, which was a "treaty" in the constitutional sense. I adhere to the view that I expressed in Re East; Ex parte Nguyen195: "A matter arises under a treaty if, directly or indirectly, the right claimed or the duty asserted owes its existence to the treaty, depends upon the treaty for its enforcement or directly or indirectly draws upon the treaty as the source of the right or duty in controversy." In the contest before this Court, presented by the respondent's objection to the competency of the appellant's "appeal", it may be arguable that the original jurisdiction is enlivened by s 75(i), at least to that extent. Once however that "matter" is disposed of, there remains only the "controversy" presented by the substantive appeal. That controversy does not depend on the construction or effect of the treaty, namely the 1976 Agreement scheduled in Australian law to the Nauru Appeals Act. Nor has any other "treaty" been identified as relevant. Instead, the remaining issues in the grounds of appeal, so described, concern only the interpretation of various laws of Nauru in their relation to the facts and specifically the conditions purportedly imposed on the special purpose visas granted to the appellant but allegedly not sought by, consented to or wished for by him. On the face of things, upon this hypothesis, the appellant's invocation of original jurisdiction would face the same difficulties as I identified in Re East196. It would fail because the necessary element of a relevant constitutional "matter" would be missing. 195 (1998) 196 CLR 354 at 385 [72]. 196 (1998) 196 CLR 354 at 386-391 [74]-[84]. Kirby The s 76(ii) contention: Gleeson CJ, McHugh J, and Gummow and Hayne JJ, however, uphold the jurisdiction of this Court to hear and determine the appellant's "appeal" pursuant to s 76(ii) of the Constitution. The respondent submitted that it was incorrect to regard the "matter" in controversy between the parties as "arising under any laws made by the [Australian Federal] Parliament". According to his submission, properly classified, the controversy, in the sense of the dispute about the substantive rights and duties in question, owed its existence solely to the law of Nauru; not to an Australian law made by the Federal Parliament. It would have been natural enough for this Court to have adopted a requirement that a matter must arise directly under the Australian federal law postulated in s 76(ii) of the Constitution. After all, the Court, from its early days, has rejected the suggestion that s 76(i) could found jurisdiction unless there are "matters which present necessarily and directly and not incidentally an issue upon [the] interpretation [of the Constitution]"197. Professor Lane198 observed that "[i]n keeping with the High Court's general literalism I rather expected to find an observation by the Court to the effect that jurisdiction under Constit s 76(ii) does not obtain unless the matter arises 'directly' under a law made by the Parliament". Nevertheless, as he noted, that was not the approach adopted by this Court in Federal Capital Commission v Laristan Building and Investment Co Pty Ltd199. In that case, the right or duty claimed owed its existence, or depended for its enforcement, on regulations that were allegedly authorised by an Ordinance, in turn made under the Seat of Government (Administration) Act 1910 (Cth), s 12. The law invoked was thus twice removed. Yet it was held sufficient to sustain the assumption of jurisdiction under s 76(ii) of the Constitution200. If it is permissible, under s 76(ii), for the Parliament to confer original jurisdiction on this Court in a matter arising indirectly under a law made by the Parliament, the controversy in the present case can readily be so classified. The Australian federal law simply picks up the Nauruan law. It treats it as a factum upon which the exercise of this Court's jurisdiction is performed. 197 James v South Australia (1927) 40 CLR 1 at 40. 198 Lane, Some Principles and Sources of Australian Constitutional Law, (1964) at 199 (1929) 42 CLR 582 at 586-587. 200 Professor Lane contrasts Collins v Charles Marshall Pty Ltd (1955) 92 CLR 529 at 540, 556-557: Lane, Some Principles and Sources of Australian Constitutional Law, (1964) at 175-176. Kirby Of course, many of the same arguments were deployed by the respondent against this construction. Thus, s 76 of the Constitution would, upon one view, be subject to an implied limitation that it was concerned, and only concerned, with "laws made by the [Federal] Parliament" so far as they related to controversies, the resolution of which depended wholly on Australian law. However, that is not a limitation that should be read into s 76 of the Constitution as necessary to its operation. On the contrary, it is not uncommon in controversies in Australian courts, involving private international law, for foreign law to be proved as a fact and for Australian courts to give effect to such law201 where there is no inconsistent Australian law and certainly no countervailing consideration of public policy202. It follows that if, contrary to my preferred conclusion, the jurisdiction of this Court invoked by the appellant pursuant to the Nauru Appeals Act is indeed "original", and not "appellate", I would agree with the opinion expressed by Gleeson CJ, McHugh J and Gummow and Hayne JJ. Upon that hypothesis, there is no express provision in s 76 of the Constitution to forbid such construction. There is nothing in the other provisions of Ch III to stand in the way. Upon that hypothesis, there are many reasons of principle and policy which would support such a construction of s 76(ii). It is consistent with the past authority of this Court that has acknowledged that the "matter" in controversy may arise indirectly under a law made by the Parliament. Here such an indirect connection would certainly exist. But it is important not to overlook the difference between the majority's conception of implied limitations in s 73 and the lack of such implications allowed in s 76(ii) of the Australian Constitution. The constitutional challenge to the appeal fails The observations made in the preceding part of these reasons constitute a secondary, not a preferred, opinion. My primary view remains that the jurisdiction of this Court invoked by the appellant under the Nauru Appeals Act is, as that Act and the 1976 Agreement state, "appellate". As such, it is compatible with s 73 of the Australian Constitution. There is no negative implication either in that section or elsewhere in Ch III that forbids the exercise of such appellate jurisdiction. The exercise is sustained by an Australian law made under s 51 of the Australian Constitution and by a compatible Nauruan law envisaged by the Nauruan Constitution. Arguably, the Australian law is also expressly envisaged by s 51(xxx) of the Australian Constitution, viewed with 201 As was contemplated would be the case in Regie Nationale des Usines Renault SA v Zhang (2002) 210 CLR 491 at 517 [66]-[67]. 202 cf Attorney-General (UK) v Heinemann Publishers Australia Pty Ltd (1988) 165 CLR 30 at 40, 51-52; see also (1987) 10 NSWLR 86 at 179-180. Kirby contemporary eyes. That is why the objection to the competency of the appeal failed. The costs issue Motion for indemnity costs: It remains for me to deal with a motion filed by the appellant, after the hearing of the objection to competency, seeking special orders joining the Commonwealth of Australia and the Republic of Nauru to the proceedings for the purpose of securing against both of those entities an award of indemnity costs in relation to the costs incurred in responding to the objection to competency. Procedural background: The background facts pertaining to the objection to competency are described above. However, to understand the appellant's motion and the orders he seeks, I will record a number of curiosities in these proceedings that are not revealed in the reasons of the other members of this Court. They cast a very different light upon the matter from what at first appears. In preparation for the hearing of this appeal, the respondent, in support of its Australian constitutional objection, filed notices pursuant to s 78B of the Judiciary Act 1903 (Cth). One such notice was served on the Commonwealth. However, upon the return of the objection for separate argument before a Full Court of this Court, neither the Commonwealth nor the Attorney-General of the Commonwealth appeared, as would have been their right under federal law and normal practice. This left the defence of the validity of the Australian legislation to the appellant alone, acting through his lawyers. It was my view, expressed twice at the outset of the hearing203, that this presented a most unsatisfactory state of affairs. It is remarkable, and in my experience wholly unprecedented, where there is an attack on the validity of federal legislation of which the Commonwealth is on notice, for it to absent itself from assistance to the Court, either to support (as would be usual), or possibly to disclaim, the validity of the challenged federal law. To leave the defence of that law, when under attack by a public officer of a foreign country having treaty arrangements with Australia, to another foreigner, detained in that country under arrangements with Australia (and such lawyers as that foreigner can secure from that position of disadvantage), is unique. Yet it was not the only unique feature of this case or of the way it was litigated. Neither during the hearing nor after the objection to competency stood for judgment did the Commonwealth (which appears in this Court in so many 203 [2004] HCATrans 440 at 19, 138. Kirby matters far less sensitive and significant204) seek to appear, to intervene or otherwise to provide oral or written submissions in response to the respondent's arguments challenging the validity of the law providing for appeals to this Court from Nauru under the Australian Constitution. Although the point argued before the Full Court was one which was of potential importance for the meaning and application of the Australian Constitution, the powers of the Australian Federal Parliament and, in particular, as those powers concern the relationships of Australia with neighbouring countries especially of the Pacific Islands, this Court was left to decide the objection without the Commonwealth's assistance. The human mind, ever curious, speculates as to why the Commonwealth was prepared to leave to an indigent foreign refugee in detention the fate of a national law of Australia, potentially of large significance extending beyond the present case and parties. In so far as speculation presents answers to my mind, they do not reflect favourably on the Commonwealth or those who made the decisions on its behalf when notified of the hearing of the objection to competency in this Court. The costs motion and argument Revelation of the MoU: Only when the appellant sought orders for costs against the Commonwealth and Nauru did he flush those entities out of their cocoon of silence. Whereas the earlier silence of Nauru was understandable, that of the Commonwealth was not. The evidence specific to the appellant's motion was restricted. However, the parties' written submissions, and those of Nauru and the Commonwealth, made reference to the record in the earlier proceedings in the Supreme Court of Nauru, detailing the appellant's interception at sea by an Australian sea transport205, his subsequent transportation to Nauru as part of the "Pacific Solution" to redirect persons who were seeking to travel by ship to Australia to claim refugee status in Australia and his eventual detention in facilities in Nauru provided pursuant to the MoU. Understandably, the MoU is expressed at a level of generality appropriate to an agreement between nation States. In consequence of Nauru's provision of detention facilities for the appellant and other asylum seekers at Australia's request, Australia undertook to provide certain "humanitarian and development assistance" to Nauru, as part of a mutual commitment to "cooperate on the management of asylum seekers on Nauru" and to "minimise the administrative burden of managing the Agreement" on the part of Nauru. However, the MoU makes no reference to any particular obligations in respect of identified detainees 204 See, for example, Papakosmas v The Queen (1999) 196 CLR 297 at 299. 205 Amiri unreported, Supreme Court of Nauru, 15 June 2004 at [3] per Connell CJ. Kirby or to any specific obligations of Australia in respect of the conduct of particular legal proceedings, such as those involving the respondent's objection to the competency of the appellant's appeal to this Court. The most that the MoU says in any way relevant to the obligations assumed by Australia is that206: "Australia ... will reasonably compensate Nauru for its assistance and for any losses incurred in this endeavour including accidents or unforeseen incidents resulting directly from ... the residence of asylum seekers on Nauru." No reference is made to any specific arrangements in relation to these proceedings in this Court, either generally or in respect of the relationship, if any, between the respondent and the Commonwealth in the conduct of such proceedings. At least after the matter was specifically raised by the Court, the fact that the Commonwealth, by way of indemnity, was funding the challenge by the respondent to the competency of the appellant's appeal should, in my view, have been brought to this Court's notice. This is because the answers given to the questions asked in court, with respect, led naturally to a conclusion that the Commonwealth and the respondent were at arm's length; and that the sole source of the initiative for the proceedings was a decision on the part of Nauru or its officials, such as the respondent. As it transpires from the affidavits filed in support of the costs motion, not only was the Commonwealth absenting itself from defending the validity of legislation enacted by the Federal Parliament, but it was at the same time providing comfort, by way of an agreed indemnity for costs, to an officer of a foreign country to attack in this Court the validity of Australian federal legislation. I cannot remember a similar position arising in my judicial experience. From my reading, I do not remember any case of a like kind occurring in the entire history of the Commonwealth or of this Court. The Commonwealth should not, of course, be penalised for any lack of full disclosure to the Court by others when the Commonwealth was absent from the hearing. However, that absence takes on a new dimension once the previously undisclosed dealings between Nauru and the Commonwealth in respect of the costs of the proceedings come to light. They were not revealed. Nor was the appellant on notice of them, simply from the terms of the MoU207. In his written submissions, the appellant states that he was unaware of the circumstances of the costs indemnity to the respondent for the competency issue before press reports appeared, revealing the indemnity, on the day following the Kirby conclusion of the hearing of the objection to competency in this Court. I accept that statement. Nauru's objection to joinder and orders: Nauru objected to its joinder and to the making of any order for costs against it. So did the Commonwealth. Each asserted that neither the motion nor any special order of joinder or costs was necessary or appropriate. The suggested reason, which has now found favour with the majority of this Court, is that no difficulty arises for the appellant's recovery of costs against the respondent because Nauru (as the Court now knows) is entitled to an indemnity from the Commonwealth in respect of any costs that it is ordered to pay to the appellant. This, it is said, affords an assurance to the appellant that his costs will be met and this Court's order for costs on the competency hearing fully discharged. The appellant responds that the existence of that indemnity is no answer to his submission that he is entitled, in the circumstances, to a special order for costs and that, to procure such order, prudence suggests that those who will have to pay it should be added as parties for that limited purpose. The Commonwealth supported Nauru's argument that protection of the position of the appellant with respect to costs was unnecessary, by orders of the kind that the appellant had sought, because, on the day that the appellant's notice of motion was served, 7 December 2004, the Australian Government Solicitor had sent a letter to the appellant's solicitors which included the following statement: "Under the Memorandum of Understanding between Australia and Nauru, the Commonwealth will meet any costs orders the respondent is ordered to pay in respect of the High Court proceedings. As such, your motion is unnecessary and an inappropriate use of the Court's time. Your client should have no concern that the respondent will not meet an order for costs made against it in the High Court proceedings, including the competency application." According to the appellant, this belated acknowledgment of the direct interest of the Commonwealth in the respondent's objection to the competency of the appellant's appeal merely compounds objections to the Commonwealth's undisclosed interest in the proceedings. It does not respond to the claim for a special costs order. Power and criteria for a special costs orders Power to provide for costs: Under r 21.05.1(b) of the High Court Rules 2004, the Court or a Justice may order that: "any person who ought to have been joined as a party or whose presence in the proceedings is necessary to ensure that all questions in the matter Kirby are effectively and completely determined be joined as a party" (emphasis added). One question that arose in the appellant's appeal to this Court was the competency of that appeal. That question was raised by the respondent. Another question that has now arisen is the disposition of the costs of the failed objection to competency and the appellant's submission that a special order should be made in his favour. Providing for the costs of proceedings is a normal part of the exercise of the judicial function in determining a matter. This Court, in the exercise of its own jurisdiction and powers, has a large discretion to provide for costs208. Once this Court's jurisdiction and powers are lawfully invoked, it is within the Court's functions to make orders for the costs, if any, that should be ordered in any disposition of proceedings. To the extent that Nauru, in its written argument, submitted that this Court lacked power to go beyond orders disposing of the appeal, whether under the foregoing provision of the Rules or otherwise, because of the terms of s 8 of the Nauru Appeals Act, I would reject that submission. It is natural that that Act should provide for the disposition of an appeal to this Court. But it is equally understandable that other sources of jurisdiction and power, including quite possibly the Australian Constitution itself, permit this Court to make orders for costs consequent upon the disposition of proceedings before it, from whatever source. Were the Court unable to do so, disposition of an appeal in favour of a party would, in many cases, constitute a hollow victory. Costs orders against non-parties: But is it necessary for an order to be made joining Nauru or the Commonwealth? The submissions on behalf of those entities that joinder was unnecessary for factual reasons in my view fail. Whilst it is true that the now-revealed particular indemnity given by the Commonwealth ensures that this Court's costs order against the respondent will ultimately be borne by the Commonwealth, it says nothing about whether a special order should be made, as for indemnity costs or solicitor and client costs, such as the appellant has sought. In so far as the indemnity arrangements are belatedly advanced to repel any need for joinder, I would reject the argument. In my opinion, the appellant's request for a special order must be considered in order to dispose of the motion properly. This conclusion presents, in turn, two issues. The first is whether it is necessary to join a person or entity as a party to proceedings so as to make effective an order for costs against that party or whether it is otherwise 208 Judiciary Act 1903 (Cth), s 26. See also Re McJannet; Ex parte Australian Workers' Union of Employees (Q) [No 2] (1997) 189 CLR 654 at 657. Kirby convenient and proper to do so. The second is whether, in the circumstances of this case, a special costs order should be made. There is no doubt that this Court has the power to make an order for costs against a non-party209. The jurisdiction and power to do so are engaged when that non-party has an interest in the subject of the litigation and where it is demonstrated that it is involved in some real way in the outcome of the matter210. Thus, an involvement in the payment of the costs of particular litigation may constitute such an interest as will attract an order directed to a non-party in respect of the costs211. The exercise of such powers is, of course, subject to observance of those the requirements of procedural fairness. requirements, a non-party will not be ordered to pay any part of the costs of the proceedings without first being notified of that possibility and afforded the opportunity to contest the making of such an order212. Under Nauru: no special costs order: In the present case, the Republic of Nauru and the Commonwealth of Australia were on notice of the appellant's motion. They were both afforded the right to be heard in resistance to a costs order, and in particular a special order for indemnity or solicitor and client costs. To this extent, it is not essential to join the Commonwealth, although it may be appropriate to do so. However, were an order contemplated against Nauru, a foreign State, it would be necessary, and proper, in my view, to join it as a party, out of respect for its status and dignity and so as to permit the different and more substantial questions involved in making any such orders against it to be fully ventilated and decided. In the result, I am unconvinced that Nauru should be joined as a party or that any special costs order should be made against it. Nauru is, in a real sense, already present in the Court in the form of the respondent. He is a public officer of Nauru. Inferentially, he is carrying out decisions made by the Government of Nauru. I therefore see no utility or necessity to join Nauru as a party. Nor do I consider that anything that Nauru or the respondent have done (so far as the evidence shows) attracts any special order for costs against either of them. In these circumstances, it is not necessary to join Nauru to ensure that all questions 209 Judiciary Act 1903 (Cth), s 26. See also Knight v FP Special Assets Ltd (1992) 174 CLR 178. 210 Knight (1992) 174 CLR 178 at 188. 211 Knight (1992) 174 CLR 178 at 192-193, 205; Helljay Investments Pty Ltd v Deputy Commissioner of Taxation (Cth) (1999) 74 ALJR 68 at 74 [25], [27]; 166 ALR 302 212 Victoria v Sutton (1998) 195 CLR 291 at 316-317 [77]. Kirby in the matter, including costs, are effectively and completely determined. In so far as the motion seeks relief against Nauru, I therefore agree with the other members of the Court that it should be dismissed. indemnity order: The Commonwealth: the Commonwealth is different. It must answer to the appellant's claim that it should bear his real costs of resisting the challenge to the competency of the appeal. The simple order that the respondent pay the appellant's costs would entitle the appellant to no more than the bare costs as between party and party. It is within judicial knowledge that such costs represent only a fraction of the real costs that are incurred in bringing, or defending, proceedings in this Court. The position of The appellant has established that the Court should exercise its jurisdiction and power to order that his real costs be paid by the Commonwealth. If a special order were not made, the indemnity given by the Commonwealth to Nauru and the undertaking given by the Commonwealth to meet the appellant's costs of the objection to competency would not go far enough. It is true that this Court, by its costs order, normally provides only for the party and party costs of a successful litigant. But this is not a normal case. A larger costs order, whether for indemnity or solicitor and client costs, will not usually be made, and particularly not against a non-party, unless some feature of the litigation convinces the Court that the party entitled to costs should have a special order. Instances in which such orders are made include where the opponent's conduct has been "plainly unreasonable", pursued for "an ulterior or collateral purpose"213, undertaken in an "unmeritorious, deliberate or high- handed" way214 or where that opponent has been shown to be guilty of "unreasonable conduct, albeit that it need not rise as high as vexation"215. When I have regard to the conduct of the Commonwealth in these proceedings, as now known to the Court, it has been highly unreasonable and such as to warrant the Court's making its disapprobation clear by providing a special costs order. Australian federal legislation was challenged as constitutionally invalid. The Commonwealth was on notice of that challenge. As is now known, it was actually funding the challenge by way of an indemnity arrangement known to the 213 PCRZ Investments Pty Ltd v National Golf Holdings Ltd [2002] VSCA 24 at [36]. 214 New South Wales Medical Defence Union Ltd v Crawford (1993) 31 NSWLR 469 215 Rosniak v Government Insurance Office (1997) 41 NSWLR 608 at 616. Kirby its officers, but unknown Commonwealth and The Commonwealth elected not to appear in this Court to support the validity of the Australian legislation. That validity has now been upheld, but no thanks to the Commonwealth's assistance. Indeed, it is despite its deliberate absence and its now disclosed financial support for the attack upon it. the appellant. the that, where I acknowledge the Commonwealth, or federal Attorney-General, intervene in the proceedings between parties, it is rare for them to be ordered to pay any costs of the parties216. However, here the Commonwealth elected not to intervene. In effect, it left to an indigent foreigner, detained in another country under arrangements with it, to find lawyers to defend the validity of Australian federal legislation. Yet, as is now revealed, it was not at arm's length from the parties. It was directly interested in the outcome. It was supporting one party to the contest, namely the respondent. Specifically, it was doing so at first without disclosing that fact to the appellant or to this Court. In effect, the Commonwealth permitted the view that it took of its financial obligations under the MoU with the Government of Nauru to prevail over its duty to the Constitution of the Commonwealth of Australia and the resolution by this Court of a contest about important principles of Australian constitutional law. I regard this regard as seriously unreasonable. The only way to ensure that it is not repeated is to provide by orders that the appellant, and those who have represented him, are not out of pocket financially. The Government parties and lawyers, who have failed, will not be out of pocket. Why should the appellant and his lawyers, who have succeeded in such circumstances, be so? the Commonwealth the conduct of Although a costs order could be made against the Commonwealth as a non-party which has been heard, I consider that it is preferable that the record be amended to make the Commonwealth a party to the proceedings for the costs disposition that I favour. This would have the additional merit of reflecting, on the record of this Court, the role that the Commonwealth has played, initially undisclosed to this Court, in funding the respondent's challenge to the competency of the appeal, which challenge has failed. Orders The foregoing are my reasons for joining in the orders of the Court, pronounced on 9 December 2004, dismissing the respondent's objection to the competency of the appellant's appeal. To the orders then announced I would add an order, on the appellant's motion for costs, that the Commonwealth of Australia be added as a party to the proceedings. The Commonwealth should be ordered to 216 University of Wollongong v Metwally (1985) 1 NSWLR 722 at 728. Kirby pay the appellant's costs of the objection to competency on an indemnity basis, with credit for the costs recovered from the respondent. CALLINAN AND HEYDON JJ. At the time of federation Nauru was a German possession. It was captured by Australian military forces on the outbreak of World War I and was subsequently administered under a mandate of the League of Nations. Its territory was occupied by Japanese military forces during World War II. Afterwards, under a United Nations trusteeship in favour of Australia, New Zealand and the United Kingdom, Australia administered Nauru on behalf of the Governments of those countries. It is unnecessary to say anything more about the events leading up to the independence of the people of Nauru and the establishment of their republic except that Australia had, during the intervening years, interested itself in the affairs of the territory and has benefited from the exploitation of the substantial resource of phosphate found there. In 1968, its people achieved their independence and the country became a sovereign state. Immediately before that event the Commonwealth Parliament enacted the Nauru Independence Act 1967 (Cth), which, by s 4 provides that after 30 January 1968 all Acts of the Commonwealth ceased to extend to the Republic and that Australia was not to exercise legislative, administrative or judicial powers in, or over, Nauru. Mr Mohammad Arif Ruhani, the appellant, has filed a notice of appeal in this Court against a decision of the Supreme Court of the Republic of Nauru dated 15 June 2004. The appellant is an Afghan national presently residing in Nauru in supervised premises. He was taken there by Australian sea transport at the end of 2001. Together with some other people, he asserted in proceedings for a writ of habeas corpus brought in the Supreme Court of the Republic of Nauru, that he was being held against his will, and that, although he had neither applied for, nor consented to its issue, a visa permitting him, he would no doubt say, in substance compelling him, to reside in the Republic, has been unlawfully issued to him. The Supreme Court of Nauru is constituted by one judge only, Connell CJ, and accordingly the appellant's application was heard by him. His Honour's decision was as follows: "The Applicants, arriving without passports or entry permits, were granted special purpose visas, which have been extended from time to time. The last extension, valid for six months, was issued on 28 January 2004 and at this present juncture, is the legal entitlement for the asylum seekers to remain in Nauru. The consent of or application by the Applicants was not a necessary requirement for the PIO [Principal Immigration Officer] of the visa. The conditions imposed by the PIO in the current extension of the special purpose visa did not constitute an illegal detention either for the purposes of the issue of a Writ of habeas corpus or a complaint under Article 5(4) of the Constitution." the granting by The legislation It is against that decision that the appellant seeks to appeal to this Court. He does so, he contends, as of right pursuant to s 44 of the Appeals Act 1972 (Nauru) as amended, and the Nauru (High Court Appeals) Act 1976 (Cth) ("the domestic Act"). The Director of Police who is the responsible supervising officer in the Republic of the appellant, is named as the respondent to the appeal and has objected to the competency of it. The issue before this Court is whether that objection should be sustained. This Court is not concerned with the validity or otherwise of any Nauruan legislation or with the effect of it. The question before the Court is to be resolved by reference to Australian law, but some attention may need to be given, for the purposes of explanation, to the Nauruan Constitution and to the Appeals Act of that country. Part V is the part of the Constitution of Nauru which deals with the judicature. It says nothing in terms about the High Court of Australia and contemplates, by Art 57, appeals from judges of the Supreme Court sitting alone, to an appellate court constituted by not fewer than two judges of that Court. Article 57(2) does however state that Parliament may provide that an appeal will lie as prescribed by law from a judgment, decree, order or sentence of the Supreme Court, to a court of another country. By a treaty done at Nauru on 6 September 1976, the Government of Australia agreed with the Government of the Republic of Nauru that appeals are to lie from the Supreme Court of Nauru to the High Court of Australia in certain cases as of right, and in others, with the leave of the trial judge, or the High Court of Australia. It is not suggested that the appeal that the appellant wishes to pursue in this instance is one which, if the Court has jurisdiction to entertain it, he may not pursue as of right. One of the articles of the treaty (Art 3) provides that procedural matters in an appeal of this kind are to be governed by the Rules of the High Court. Article 4 provides that pending the determination of an appeal to this Court the judgment, decree, order or sentence to which it relates is to be stayed unless otherwise ordered. The same article provides that the orders of this Court are to be made binding and effective in Nauru. Under Art 6 either nation may give 90 days notice of an intention to terminate the treaty. No such notice has been given and it is not for this Court to speculate upon the reasons why the Republic chooses to challenge the jurisdiction of this Court rather than to terminate the treaty. Similarly, is not for this Court to speculate upon why the Commonwealth chose not to intervene in the proceedings. The treaty was enacted into and became part of the law of Australia by the domestic Act as a schedule to that Act. Section 5 of the domestic Act provides as follows: "Appeals to High Court (1) Appeals lie to the High Court of Australia from the Supreme Court of Nauru in cases where the Agreement provides that such appeals are to lie. The High Court has jurisdiction to hear and determine appeals mentioned in subsection (1). (3) Where the Agreement provides that an appeal is to lie to the High Court of Australia from the Supreme Court of Nauru with the leave of the High Court, the High Court has jurisdiction to hear and determine an application for such leave." Sections 6 and 7 are as follows: Procedure The power of the Justices of the High Court or of a majority of them to make Rules of Court under section 86 of the Judiciary Act 1903 extends to making Rules of Court in relation to matters referred to in paragraph 1 of Article 3 of the Agreement. Quorum The jurisdiction of the High Court to hear and determine an appeal or an application for leave to appeal under section 5 shall be exercised by a Full Court consisting of not less than 2 Justices." Section 8 provides: "Form of judgment on appeal The High Court in the exercise of its appellate jurisdiction under section 5 may affirm, reverse or modify the judgment, decree, order or sentence appealed from and may give such judgment, make such order or decree or impose such sentence as ought to have been given, made or imposed in the first instance or remit the case for re- determination by the court of first instance, by way of a new trial or rehearing, in accordance with the directions of the High Court." Section 9 is as follows: "Decision in case of difference of opinion Where the Justices sitting as a Full Court in accordance with section 7 are divided in opinion as to the decision to be given on any question, the question shall be decided as follows: if there is a majority of the one opinion, the question shall be decided in accordance with the opinion of the majority; or in any other case: in the case of an application for leave to appeal – the application shall be refused; or in the case of an appeal – the decision appealed from shall be affirmed." Section 10 of the domestic Act confers a right of audience upon any person entitled to practise as a barrister or solicitor in any federal court of Australia, or who is on the register or roll of practitioners in this country or Nauru. The respondent's submissions The respondent submits that the jurisdiction of this Court is exhaustively prescribed by Ch III of the Constitution: that chapter is incapable of supporting a conferral of a jurisdiction to hear and determine appeals, whether so designated or not, from a foreign country. The Supreme Court of Nauru is nowhere mentioned in Ch III of the Constitution. The entertainment and disposition of an appeal from the Republic of Nauru cannot be an exercise therefore of the judicial power of the Commonwealth. The jurisdiction that the domestic Act purports to confer is appellate in form and substance. Section 73 of the Constitution confines the appellate jurisdiction of the High Court to a jurisdiction to hear and determine appeals from Justices exercising the original jurisdiction of the Court, from any other federal court or court exercising federal jurisdiction, or from the Supreme Court of any State, or from any other court of any State from which, at the establishment of the Commonwealth, an appeal lay to the Queen in Council, or from the Inter-State Commission as to questions of law only. the Constitution refers only The argument continues, that no other head of constitutional power supports the conferral of what is effectively a Nauruan appellate jurisdiction. Section 122 of to the Territories of the Commonwealth. It has nothing to say about former territories and independent nations. Nor, it was submitted, could a purported exercise of the external affairs power under s 51(xxix), or the Pacific islands power under s 51(xxx)217, or the incidental power under s 51(xxxix) of the Constitution extend to the conferral of a judicial power upon the High Court to hear and determine a proceeding instituted in Nauru against an official of Nauru where the enforcement of the determination depended upon the active co-operation of other officials of the Executive of Nauru. It follows that the domestic Act purporting to give effect to the treaty by making provision for the hearing of appeals from Nauru is invalid. We will return to these submissions later. The appellant's submissions The appellant seeks to counter the respondent's objection to competency upon alternative bases. First, he submits that the jurisdiction for which the domestic Act provides, is a form of original jurisdiction conferrable under s 76(ii) of the Constitution, because it arises under a law made by the Parliament pursuant to s 51(xxix) or s 51(xxx) or both of them, and accordingly gives rise to a matter for determination by the Court. If that is not so, the appellant submits, the "appeal" which he seeks to pursue in this Court is a matter arising under the treaty and falls within the jurisdiction conferred by s 75(i)218 of the Constitution. His last submission is that if the jurisdiction conferred by the domestic Act is not original jurisdiction, then it is appellate jurisdiction of a kind that may validly be conferred under s 73 and ss 51(xxix) and 51(xxx) of the Constitution. The appellant's first proposition may, as a general one, be accepted, that the way in which the proceedings are designated does not necessarily define their character. For this general proposition there is authority, but, as will appear, 217 "the relations of the Commonwealth with the islands of the Pacific". 218 That section provides: "75 In all matters: (i) arising under any treaty; the High Court shall have original jurisdiction." none of it holds that the definition or description of the proceedings is irrelevant, or by any means immaterial. Indeed, the description or definition here, taken with other matters to which we will refer, is relevant and material. The appellant's second proposition is that whenever a matter arising under Commonwealth law is brought for the first time before a court exercising the judicial power of the Commonwealth, that court will be exercising original jurisdiction. It is a necessary part of that submission that this Court, in entertaining an appeal under the domestic Act, would be exercising the judicial power of the Commonwealth because it would, in doing so, be giving effect to a law of the Parliament of the Commonwealth. Resolution of the objection In truth the domestic Act here does give rise to a matter. Its enactment as a federal Act and the need of this Court to pass upon its validity and construe it have that consequence. But what the appellant seeks here is not simply the resolution of that federal matter, but of a further matter, the substantive controversy arising in, and already determined by the Supreme Court of the sovereign state of Nauru. In short there are two matters before the Court one of which the Court has jurisdiction to entertain, and the other which it does not, namely the controversy originating in Nauru and the resolution of which, by binding and enforceable orders, can only be effected in Nauru. What we have said is in no way to deny that a valid and enforceable enactment of the Parliament may have a double function of creating and enforcing rights "in one blow"219. Nor, moreover, does it deny that a right or privilege created by the law of another polity may be given the force of federal law as was the position in Hooper v Hooper220, a case about which more will need to be said later. For present purposes it suffices to say that the adoption by enactment, of legislation of another place, for the purpose of making that legislation binding upon the people of the adopting polity is not what has happened here. For the most part, the cases cited by the appellant for the second proposition have this in common221: they were concerned with matters, whether 219 See the reasons of Gummow and Hayne JJ at [111]. 220 (1955) 91 CLR 529. 221 Federal Commissioner of Taxation v Munro (1926) 38 CLR 153 at 181 per Isaacs J; Federal Commissioner of Taxation v J Walter Thompson (Aust) Pty Ltd (1944) 69 CLR 227 at 228 per Latham CJ; Minister of State for the Navy v Rae (1945) 70 CLR 339 at 340-341 per Dixon J; Watson v Federal Commissioner of Taxation (1953) 87 CLR 353 at 370-371 per Dixon CJ, McTiernan, Williams, (Footnote continues on next page) designated as "appeals" or not, which had been heard in the first instance by boards or tribunals, or other bodies established by the federal polity, which, although apparently intended to, and actually operating in a judicial or quasi- judicial way, were not Ch III courts, or courts of the States or Territories, and were not then exercising, and could not exercise the judicial power of the Commonwealth. The issue therefore in those cases, was not whether the High Court did or did not have jurisdiction to entertain the application for recourse to it, but whether the jurisdiction to be exercised on such recourse was original jurisdiction. On that question the definition or description of the process in question, as an appeal or otherwise, was not decisive. The issue that is presented here is a different issue. It is whether the High Court has any jurisdiction at all to entertain the appellant's claim for relief from this Court. In the cases cited, the issue, as to the true nature of the jurisdiction, only arose for resolution because it was necessary to ascertain the nature of the recourse to this Court in order to lay down the manner of disposition, that is the procedure to be followed in deciding the case and whether an appeal lay to the Full High Court. Reference need be made to one only of those cases cited to demonstrate that this is so. In Minister of State for the Navy v Rae222, the ultimate question was as to the amount of compensation which should be paid by the Commonwealth to the owner of a fishing boat which had been acquired under the wartime National Security (General) Regulations for defence purposes. In the first instance the compensation had been fixed by a naval compensation board established by the Commonwealth. The Minister of State for the Navy was dissatisfied with the assessment of the board. He invoked the jurisdiction of this Court (which came to be exercised by Dixon J) under reg 60G of the National Security (General) Regulations which provided as follows: "(1) If either the Minister or the claimant is dissatisfied with the assessment of a Compensation Board, he may, within one month after receipt of the notice of the assessment of the Board, or, where the assessment was made pursuant to sub-regulation (3) of regulation 60D of these Regulations, within one month after the doing of the thing in respect of which the claim was made, apply to a court of competent jurisdiction for a review of the assessment. Fullagar and Kitto JJ; Farbenfabriken Bayer Aktiengesellschaft v Bayer Pharma Pty Ltd (1959) 101 CLR 652 at 657 per Dixon CJ; Mellifont v Attorney-General (Q) (1991) 173 CLR 289 at 312-313 per Brennan J; Hembury v Chief of the General Staff (1998) 193 CLR 641 at 653 [31] per Gummow and Callinan JJ; Eastman v The Queen (2000) 203 CLR 1 at 34-35 [109]-[110] per McHugh J. 222 (1945) 70 CLR 339. (7) In any matter not provided for in these Regulations the powers, practice and procedure of the court shall be as nearly as may be in accordance with the powers, practice and procedure of the court in civil actions or appeals. (8) For the purposes of this regulation, 'court of competent jurisdiction' means a court of the Commonwealth, or of a State or Territory of the Commonwealth (other than a court presided over by a Justice of the Peace, Magistrate or District Officer), which would have jurisdiction to hear and determine the application if it were an action between subject and subject for the recovery of a debt equal to the compensation claimed in the original claim to the Minister, or when the compensation claimed is wholly or partly in the form of a periodical payment, of a debt equal to the sum which the periodical payment claimed would amount to for the period of one year (or if the claim is in respect of a period of less than one year, for such lesser period), together with the amount of any other items in the claim." It may be noted that the terminology for the invocation of the jurisdiction of the Court there, correctly, was, "apply ... for a review" and not "appeal". His Honour said this of it223: "It is evident that, up to the stage when an application is made to the Court the assessment and award of compensation must be regarded as an administrative matter ... [The judicial power of the Commonwealth] is brought into play for the first time when, on so called proceedings to review, the Court determines the compensation. They are in truth originating proceedings in the original jurisdiction, just as are the 'appeals' from the Commissioner of Taxation and from taxation Boards of Review and Valuation Boards. As the matter concerns a claim ... against the Commonwealth, it is one over which the High Court has original jurisdiction in virtue of s 75(iii) of the Constitution ..." It can also be seen, as his Honour pointed out in the passage quoted, that the High Court had original jurisdiction in any event because the claim for compensation was against the Commonwealth, and, as a matter to which the Commonwealth was a party, was one that could be brought in the original jurisdiction under s 75(iii) of the Constitution. It was only necessary for Dixon J to identify with precision the nature of the jurisdiction to be exercised because 223 (1945) 70 CLR 339 at 340-341. the regulations were not on their face apt for the disposition of proceedings in the High Court. It is the presence and form of Ch III of the Constitution that dictate the special tenderness that the Parliament and this Court have generally, but not invariably, shown224 for the due exercise of federal judicial power by courts and not otherwise in this country. Elsewhere, and in past times, the drawing of a distinction between a court of law and a court of other official business was often of little importance. In Machinery of Justice, Professor Jackson makes this point225: "A 'court' was a place for doing business of a public nature, judicial or otherwise, and wherever we find places with any peculiar standing (Royal Forests, Staple Towns, Cinque Ports) or certain industries (lead mining in the Mendips, tin mining in Devon and Cornwall) or classes of men (merchants, soldiers, the general population differentiated ecclesiastics) we find historically a special body of law with special courts." from Over time various other bodies and offices came to be established such as the General and Special Commissioners of Income Tax (in 1803) and the Board of Railway Commissioners (in 1846). In the latter year, the county courts of England were established by the County Courts Act as judicial tribunals of less formality and rigour than the High Courts of Westminster. They were intended to achieve226: "a system of local civic tribunals adapted to the needs of the great masses of the population and the maximum convenience of forum, simplicity of 224 For more than fifty years, until the Boilermakers' case (R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254), the Court of Conciliation and Arbitration and its like predecessors exercised both arbitral and judicial power as if they were Ch III courts, and, in regarding the judges of the Family Court (R v Watson; Ex parte Armstrong (1976) 136 CLR 248), and of the Federal Court (R v Federal Court of Australia; Ex parte Pilkington ACI (Operations) Pty Ltd (1978) 142 CLR 113) as amenable to writs issued under s 75(v), this Court treated them as "officers" of the Commonwealth rather than as judges of courts from which appeals lay although Ch III itself in terms distinguishes between judges and courts on the one hand, and "officers" on the other. 225 Jackson's Machinery of Justice, 8th ed (1989) at 107. 226 See Wraith et al, Administrative Tribunals, (1973) at 28. procedure, suitors being able to obtain relief and defend themselves ... with summary determination and moderation of expenses …" Review by the courts in its current form and the need therefore to distinguish it from the process by which the first decision was made, are largely products of the twentieth century as a result, among other things, of increased state involvement in many areas of public welfare. A decision as to the nature of the jurisdiction to be exercised by the courts in undertaking the review became important essentially because it affected the nature of the relief, whether by way of prerogative writs or statutory remedies, that could be granted. At federation however, the proliferation of administrative and quasi- judicial tribunals lay in the future, although of course the founders were conscious of the need to distinguish in the Constitution, as they did, between executive and judicial power. One of their concerns was to define, with as much precision as possible, the scope of each of federal original and federal appellate jurisdiction and to provide a remedy for unlawful conduct by officers of the new federal polity (s 75(v)). A second concern was to give effect to another autochthonous expedient227, of the conferring upon a final appellate and constitutional court, of a substantial original jurisdiction as well. A further concern was to ensure that original federal jurisdiction would be exercised in truly federal matters only, without trespass upon State jurisdiction228. No concern or intention on the part of the founders is to be discerned in the language of the debates at the Constitutional Conventions, or in Ch III itself, to transmogrify an appeal into an exercise of original jurisdiction. The appellant's submission that the first contact of a "case" with the High Court involves an exercise of original jurisdiction is plainly wrong. An appeal from a Supreme Court of a State, or the Federal Court is exactly that, an appeal, even though the appeal is the first encounter that the case has with the High Court. It is inapt and wrong to seek to characterize the jurisdiction said to be exercisable here as original jurisdiction for other reasons. Connell CJ in hearing the appellant's application for habeas corpus was sitting as a judge of a court, exercising judicial power. Indeed, the relief sought has been regarded for hundreds of years as uniquely appropriate for the prevention by the courts of excesses and abuses of the Executive and its own administrative bodies and officers. It is the courts which grant the relief against administrative bodies; 227 cf R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 at 268 per Dixon CJ, McTiernan, Fullagar and Kitto JJ. 228 It is now well established in this Court that the Commonwealth may not confer State jurisdiction upon a federal court: Gould v Brown (1998) 193 CLR 346. administrative bodies do not grant it against themselves. We cannot accept that a court invited to reverse the judgment of another court which has dismissed an application for relief of that kind, wherever the court may have sat, would be exercising original jurisdiction. The judgment of the Supreme Court of Nauru cannot be ignored. It would be an affront to all elementary principles of comity to do so. The Supreme Court of Nauru is a real court. The judgment of its Chief Justice is, in every respect, form, substance, application of principle, judicial method, and, it should be emphasized, effect and operation, a judgment of a court, non-compliance with which would be visited in Nauru with all the consequences and sanctions available to any duly established court. To regard an evaluation of that process by a court constituted by several judges of another final court, albeit of a different jurisdiction, proceeding in every relevant respect as if hearing an appeal, as an exercise in original jurisdiction, would be to give effect to a fiction. That the jurisdiction purportedly conferred must be, if anything, appellate, appears most clearly from s 8 of the domestic Act. Courts exercising a jurisdiction to modify a sentence imposed in a criminal jurisdiction, or order a retrial or a new trial, cannot possibly be said to be exercising an original jurisdiction. Any suggestion that the jurisdiction purportedly exercisable by the Court under the domestic Act is original jurisdiction is comprehensively contradicted by the express language of other parts of it, beginning with its short title which is totally inapt for the exercise of anything but appellate jurisdiction. The words of s 5(1) are "[a]ppeals lie to the High Court ... in cases where the Agreement provides that such appeals are to lie". Each of ss 5(1), (2), (3), 7 and 10(2) and (3) refers in terms to "appeal" or "appeals". Section 8 further refers to the giving of judgment in the exercise of an appellate jurisdiction, that ought to have been made "in the first instance". And s 9 makes the sort of provision that is necessary and conventional to resolve a difference of opinion in an appellate court. Every historical and semantic indication is of an intention to confer a genuine appellate jurisdiction. The same is true of the Appeals Act of Nauru. The use of the language of appeal there is plainly deliberate and not a mindless adoption of the nomenclature of earlier enactments. There is not the slightest suggestion in the domestic Act that the jurisdiction intended to be conferred on this Court is of an original kind. Presumably, in the proceeding within original jurisdiction which the majority say is now to take place, the appellant would seek to have the matter entirely reheard as if there had not already been a trial in Nauru despite that the reason for recourse to this Court is that there has been a trial and a judicial decision in Nauru. In some unexpressed way, this Court is now, it is urged, bound to proceed as if such a decision has not been made and no trial has taken place. To proceed in that way would be to proceed in the teeth of the most clearly expressed language possible in the domestic Act. We can no more accept that than we can that the Supreme Court of Nauru is to be treated as a foreign equivalent to an administrative and strictly non-judicial emanation of the federal Parliament. It is inconceivable that the founders would have contemplated, and sought to make constitutional provision for, the exercise of an appellate or an original jurisdiction of the High Court, over the citizens or subjects of another country, nation or colony, that was not a territory. At federation, the Privy Council was the final avenue of appeal for all of the colonies and territories of the British Empire and had no judicial role to play in relation to foreign countries. It is unthinkable that the founders would have considered it necessary, or desirable, to make provision for the bringing of appeals to the High Court from another dominion or colony of the Empire, let alone from a foreign country. That they did not do so in making the constitutional settlement with the United Kingdom and in drafting the Constitution in the form that they did appears from the form of Ch III itself which is silent on these matters. An expansive interpretation of the Constitution is one thing: an interpretation which would confer upon an Australian court, even the High Court, an appellate jurisdiction over the citizens of, and a sovereign foreign power itself, whether as a result of the making of a treaty or otherwise, would be to go far beyond expansiveness and is much further than we are prepared to go. How is this Court to proceed henceforth in this matter? It can only do so by embarking on an elaborate fiction that the "appeal" is not an appeal. Why should the parties not give evidence if this is to be an exercise of original jurisdiction? May they rely upon the Nauruan laws of evidence? Must they be proved? Will not the substantive law be the law of Nauru? It is an irony that the latest statement of that, and its application to the facts proved in this case in Nauru, are to be found in the judgment of Connell CJ. Why should this Court take a different view of those when this Court is exercising original jurisdiction? Are there to be pleadings? What about subpoenas? How will this Court be able to enforce the service of and obedience to them in Nauru? The answer to all of these questions must be whatever the Court chooses to invent for neither the Judiciary Act 1903 (Cth), the Rules of Court, nor the Constitution supplies any answers. The jurisdiction intended to be conferred by the domestic Act is appellate and appellate only. This Court should not construe the treaty to give effect to a result contrary to its language and purpose. Section 73 of the Constitution defines in a clearly exclusive way the appellate jurisdiction of the Court229. Not surprisingly its authors made no attempt to embrace within it the legal affairs of 229 Re Wakim; Ex parte McNally (1999) 198 CLR 511. any other sovereign foreign nation. It is significant that the opening paragraph of s 73 empowers the Parliament to prescribe exceptions to, and regulations for the exercise of the appellate jurisdiction of the Court, but not additions. It may be, we express no concluded view on this, that the Commonwealth could, if it and Nauru were so minded, establish a special tribunal under various heads of constitutional power230, to hear Nauruan appeals but that would be a very different measure from the impermissible one attempted here, of vesting Nauruan appellate jurisdiction in the High Court, a Ch III court. No matter how the jurisdiction purported to be conferred may be characterized there are further reasons why the objection to competency must be upheld. Nauru, by objecting to competency has taken the stance that it is not to be bound by the decision of this Court in this country. Australia is not likely to send a gun boat to the Republic to enforce obedience to a subpoena or a decision of this Court. And, without the real and effective co-operation of Nauru, a decision of this Court will be unenforceable. The remedy sought here is against the executive of a foreign country in a foreign country. As to that, Halsbury's Laws of England puts the matter this way231: "Jurisdiction of a state is strictly territorial in the sense that a state cannot exercise its powers or authority in the territory of another state or elsewhere outside its territory except by virtue of a permissive rule derived from international custom or from a treaty or convention. Thus, a state is not entitled to use physical force in the territory of another state to assert its alleged rights. Nor is it entitled to exert peaceable measures on the territory of any other state by way of enforcement of its national laws without the consent of that other state, by way for example of service of documents, police or tax investigations, or by the performing of notarial acts." (footnotes omitted) In Abebe v The Commonwealth232 Gleeson CJ and McHugh J emphasized the critical element of enforceability233: "The existence of a 'matter', therefore, cannot be separated from the existence of a remedy to enforce the substantive right, duty or liability. 230 But see R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 at 269 per Dixon CJ, McTiernan, Fullagar and Kitto JJ. 231 4th ed, vol 18, par 1532. 232 (1999) 197 CLR 510. 233 (1999) 197 CLR 510 at 528 [32]. That does not mean that there can be no 'matter' unless the existence of a right, duty or liability is established. It is sufficient that the moving party claims that he or she has a legal remedy in the court where the proceedings have been commenced to enforce the right, duty or liability in question. It does mean, however, that there must be a remedy enforceable in a court of justice, that it must be enforceable in the court in which the proceedings are commenced and that the person claiming the remedy must have sufficient interest in enforcing the right, duty or liability to make the controversy justiciable." (emphasis added) This is consistent with the stance taken by the Court from its establishment. In Waterside Workers' Federation of Australia v J W Alexander Ltd234, Isaacs and Rich JJ said this: "But the essential difference [between arbitral and judicial power] is that the judicial power is concerned with the ascertainment, declaration and enforcement of the rights and liabilities of the parties as they exist, or are deemed to exist, at the moment the proceedings are instituted ..." In Rola Co (Australia) Pty Ltd v The Commonwealth235, Latham CJ (with whom McTiernan J agreed) was of the view that a committee of reference did not exercise judicial power because it did not have any power to enforce its own determination. With respect to the definition of judicial power given by Griffith CJ in Huddart, Parker & Co Pty Ltd v Moorehead236 Latham CJ said237: "If a body which has power to give a binding and authoritative decision is able to take action so as to enforce that decision, then, but only then, according to the definition quoted, all the attributes of judicial power are plainly present. I refer to what I say more in detail hereafter, that the Privy Council, in the Shell Case238 ... expressly held that a tribunal was not necessarily a court because it gave decisions (even final decisions) between contending parties which affected their rights." 234 (1918) 25 CLR 434 at 463. 235 (1944) 69 CLR 185. 236 (1909) 8 CLR 330 at 357. 237 (1944) 69 CLR 185 at 199. 238 Shell Co of Australia Ltd v Federal Commissioner of Taxation (1930) 44 CLR 530; Hooper's case, upon which the appellant relies, and to which we said we would return, is of no assistance to the appellant. There Dixon CJ, McTiernan, Williams, Webb, Fullagar, Kitto and Taylor JJ said this239: "It is no answer to the above analysis to say that the right put in suit when a 'matrimonial cause' is instituted under the Act is a right created by State law – by the law of the State of the domicil. What the Act does is to give the force of federal law to the State law. The relevant law is administered in a suit instituted under the Act not because it has the authority of a State, but because the Commonwealth. For the purposes of the suit it is part of the law of the Commonwealth. The Act might, in s 11, have defined the rights to which effect was to be given in 'matrimonial causes' by enacting a system of its own. Or it might have defined those rights by reference to the law of England or the law of New Zealand or the law of one particular Australian State. The fact that it chose to adopt the law of the State of the domicil in each particular case cannot affect the substance of the matter." the authority of it has These points should be made about the passage which we have quoted. The reference to the authority of the Commonwealth is no minor matter. Because the events with which the case and the relevant federal enactment were concerned were ones occurring within, and in respect of persons amenable to the authority of, the Commonwealth, whatever decision was made, was immediately enforceable by and within the Commonwealth. To put the matter another way, the Commonwealth was in a position to enforce the immediate right, duty or liability held to exist by the Court. That is not to say that suits may not be entertained by a federal court, or this Court, simply because the decisions and judgments may be in respect of matters having an extra-territorial effect or operation. But no one has suggested in this case that this Court in entertaining an "appeal" from the Republic of Nauru would be exercising some form of Australian extra-territorial jurisdiction, and nor could any such suggestion be made. No state can exercise its powers or authority in the territory of another state or elsewhere outside its territory unless by treaty, convention or international custom, the other state has assented or may be taken to have assented to the exercise of the relevant power or authority. A state may not use physical force in the territory of another state to give effect to asserted rights and may not otherwise impose sanctions to give effect to its laws in another state. Consent is always required, and it may safely be assumed by reason of the stance that the respondent takes here, that it would not assent in any way to the enforcement of a writ of habeas corpus were this Court to entertain this "appeal", allow it, and order that the decision of the Supreme Court of Nauru be set aside 239 (1955) 91 CLR 529 at 536-537. and that a writ of habeas corpus issue. In other words, neither this Court nor the Commonwealth has here a capacity to fulfil an essential judicial function referred to in Brandy v Human Rights and Equal Opportunity Commission240, of enforcing decisions (in Nauru), albeit that the domestic Act purports to confer a right to come to the Court. In the absence of willingness on the part of the respondent to accept and give effect to an order of this Court, whether in its original or appellate jurisdiction, a decision of this Court would be without efficacy of any kind. Even though courts may and do nowadays make declarations without other ancillary orders, they do not do so unless the declarations will have some real utility or will produce foreseeable consequences. This appears clearly enough from what was said by Mason CJ, Dawson, Toohey and Gaudron JJ in Ainsworth v Criminal Justice Commission241: "It is now accepted that superior courts have inherent power to grant declaratory relief. It is a discretionary power which '[i]t is neither possible nor desirable to fetter … by laying down rules as to the manner of its exercise.'242 However, it is confined by the considerations which mark out the boundaries of judicial power. Hence, declaratory relief must be directed to the determination of legal controversies and not to answering abstract or hypothetical questions243. The person seeking relief must have 'a real interest'244 and relief will not be granted if the question 'is purely hypothetical', if relief is 'claimed in relation to circumstances that [have] not occurred and might never happen'245 or if 'the Court's declaration will produce no foreseeable consequences for the parties'246." 240 (1995) 183 CLR 245 at 268-269 per Deane, Dawson, Gaudron and McHugh JJ. 241 (1992) 175 CLR 564 at 581-582. 242 Forster v Jododex Aust Pty Ltd (1972) 127 CLR 421 at 437 per Gibbs J. 243 See In re Judiciary and Navigation Acts (1921) 29 CLR 257. 244 Forster (1972) 127 CLR 421 at 437 per Gibbs J; Russian Commercial and Industrial Bank v British Bank for Foreign Trade Ltd [1921] 2 AC 438 at 448 per Lord Dunedin. 245 University of New South Wales v Moorhouse (1975) 133 CLR 1 at 10 per Gibbs J. 246 Gardner v Dairy Industry Authority (NSW) (1977) 52 ALJR 180 at 188 per Mason J, see also at 189 per Aickin J; 18 ALR 55 at 69, 71. Courts do not make declarations of the law divorced from an ability to administer and give effect to that law. A decision in this "appeal" would be no more than declaratory in effect, and could not be administered and enforced without the active and co-operative intervention of the respondent in Nauru. Nothing turns on the exercise, on two occasions, of the appellate jurisdiction of this Court, in Nauruan appeals247. Decisions in which the point has not been taken and the different positions not argued, have no more binding force than, for example, the suggestion of McHugh J in argument in Re Wakim; Ex parte McNally248 that the domestic Act might be invalid. Another submission of the appellant is that the "appeal" arises under a treaty within the meaning of s 75(i) of the Constitution. We would reject that argument also. Here there are two matters. The first and the substantive one raises the question whether the appellant is entitled to a writ of habeas corpus to be enforced in Nauru. The other is whether the appellant is entitled to come to this Court, effectively to have the domestic Act and the Constitution construed. Self-evidently, the first of the matters does not arise under a treaty. It arises under Nauruan law exclusively. One aspect of the other matter touches upon but does not arise under the treaty. That is the construction of the domestic Act, and although it may arise out of an Act enacted to give effect to the treaty, that is a different matter from something arising under the treaty itself. Even if it did however, it is not a matter which, if resolved in the appellant's favour, would entitle him to relief enforceable under the treaty and in Nauru. It is not entirely clear whether the appellant was also in some way seeking to contend that the domestic Act was validly made under s 51(xxix), the external affairs power, or s 51(xxx), the Pacific islands power of the Constitution, or a combination of them. Section 51(xxix) has nothing to say about the judicial power for which Ch III makes provision. The other head of power, the Pacific islands power, was conferred for reasons entirely unrelated to judicial power249 and has nothing to say about it either. As we have mentioned, perhaps the Parliament could legislate for the establishment of an appellate tribunal for the Pacific or part of it, with the active support of nations of the region, but such a tribunal would not and may not be the High Court, or a Ch III court of the Commonwealth. 247 Director of Public Prosecutions (Nauru) v Fowler (1984) 154 CLR 627; Amoe v Director of Public Prosecutions (Nauru) (1991) 66 ALJR 29; 103 ALR 595. 248 Re Wakim; Ex parte McNally transcript of proceedings, 2 December 1998 at 4979. 249 For example a vulnerability to other nations seeking to establish Pacific empires and the acquisition, use, residence and repatriation of Pacific island labour. We would uphold the objection to competency. The appellant should pay the respondent's costs of the objection. For the reasons given by the majority, we agree that the notice of motion filed by the appellant and dated 7 December 2004 should be dismissed, and that the appellant should pay the costs of the motion.

HIGH COURT OF AUSTRALIA PALIFLEX PTY LIMITED APPELLANT AND CHIEF COMMISSIONER OF STATE REVENUE RESPONDENT Paliflex Pty Limited v Chief Commissioner of State Revenue [2003] HCA 65 12 November 2003 ORDER Appeal dismissed with costs. On appeal from the Supreme Court of New South Wales Representation: N C Hutley SC with G A Moore, N Perram and K M Richardson for the appellant (instructed by Brock Partners) M G Sexton SC, Solicitor-General for the State of New South Wales with I Mescher for the respondent (instructed by Crown Solicitor for the State of New South Wales) Interveners: D M J Bennett QC, Solicitor-General of the Commonwealth of Australia with G Witynski and N L Sharp intervening on behalf of the Attorney-General of the Commonwealth of Australia (instructed by Australian Government Solicitor) M G Sexton SC, Solicitor-General for the State of New South Wales with I Mescher intervening on behalf of the Attorney-General for the State of New South Wales (instructed by Crown Solicitor for the State of New South Wales) C J Kourakis QC, Solicitor-General for the State of South Australia with J C Pritchard intervening on behalf of the Attorney-General for the State of Western Australia (instructed by Crown Solicitor for the State of Western Australia) C J Kourakis QC, Solicitor-General for the State of South Australia with C Bleby intervening on behalf of the Attorney-General for the State of South Australia (instructed by Crown Solicitor for the State of South Australia) P J Hanks QC with S G E McLeish intervening on behalf of the Attorney- General for the State of Victoria (instructed by Victorian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Paliflex Pty Limited v Chief Commissioner of State Revenue Constitutional law (Cth) – Exclusive powers of Commonwealth Parliament – Place acquired by Commonwealth for public purposes – Subsequent State laws – Whether State laws applied to place on enactment – Whether State laws valid on enactment – Subsequent disposition of place by Commonwealth – Whether State laws applied to place after disposition – Whether State laws valid in application to place after disposition – Whether imposition of land tax under State laws in respect of place enforceable – Constitution, s 52(i) – Land Tax Act 1956 (NSW) – Land Tax Management Act 1956 (NSW). Taxation – Land tax – Place acquired by Commonwealth for public purposes – Subsequent State laws – Whether State laws applied to place on enactment – Whether State laws valid on enactment – Subsequent disposition of place by Commonwealth – Whether State laws applied to place after disposition – Whether State laws valid in application to place after disposition – Whether imposition of land tax under State laws in respect of place enforceable – Constitution, s 52(i) – Land Tax Act 1956 (NSW) – Land Tax Management Act 1956 (NSW). Constitution, s 52(i). Commonwealth Places (Administration of Laws) Act 1970 (NSW). Commonwealth Places (Mirror Taxes) Act 1998 (Cth). Commonwealth Places (Mirror Taxes Administration) Act 1998 (NSW). Land Tax Act 1956 (NSW). Land Tax Management Act 1956 (NSW). State Revenue Legislation Amendment Act 1997 (NSW). GLEESON CJ, McHUGH, GUMMOW, KIRBY AND HAYNE JJ. The transfer of the Land By written contract dated 5 September 1997 and completed 30 January the the appellant, Paliflex Pty Ltd ("Paliflex"), purchased from Commonwealth of Australia ("the Commonwealth") the property known as "Tresco" and located at 97 Elizabeth Bay Road, Elizabeth Bay ("the Land"). Elizabeth Bay is an inner suburb of Sydney bordering Sydney Harbour. The purchase price was $9 million. The transfer in favour of Paliflex was registered on 4 February 1998. It appears that, at all material times, the Land has been registered under the provisions of the Real Property Act 1900 (NSW). From a date in 1922 until the registration of the transfer to Paliflex, the Commonwealth was the registered proprietor of the Land. The transferee, Paliflex, remains the registered proprietor. The contract for sale had been assessed to stamp duty under the Stamp Duties Act 1920 (NSW) ("the Stamp Duties Act") in the sum of $480,490. The validity of the Stamp Duties Act to authorise that assessment and a fine for failure to pay the assessed duty was contested in proceedings in the Supreme Court of New South Wales1. In those proceedings, Austin J upheld the submission by Paliflex, which had been supported by the Attorney-General for the Commonwealth on an intervention, that no moneys were due and owing by Paliflex. This was because the Stamp Duties Act was outside the legislative competence of the New South Wales Parliament to the extent that its provisions purported to apply to a conveyance or agreement for the sale of a property which was, for the purposes of s 52(i) of the Constitution, a place acquired by the Commonwealth for public purposes. No appeal was taken from that decision and its correctness was not questioned in the present appeal. This appeal also concerns the operation of s 52(i) of the Constitution but with respect to the application of New South Wales land tax legislation to the Land. 1 Chief Commissioner of Stamp Duties v Paliflex Pty Ltd (1999) 47 NSWLR 382. McHugh Kirby Hayne The land tax litigation On 20 February 2000, the respondent, the Chief Commissioner of State Revenue ("the Commissioner"), issued to Paliflex a notice of assessment for land tax totalling $98,836 in respect of ownership of the Land by Paliflex on 31 December 1999. Thereafter, on 29 April 2000, the Commissioner issued to Paliflex an assessment in respect of the Land as owned by Paliflex on 31 December 1998. Objections against the two assessments were disallowed. An appeal to the Supreme Court against that disallowance and a cross-claim by the Commissioner to recover on the assessments were heard by Mason P2 on a statement of agreed facts. His Honour dismissed the appeal and entered judgment for the Commissioner on the cross-claim. An appeal by Paliflex was the Court of Appeal (Spigelman CJ, Stein and Heydon JJA)3. The appeal was dismissed but on grounds which went beyond, and differed from, those upon which Mason P had relied. taken The scheme of the New South Wales legislation was that the tax was imposed by the Land Tax Act 1956 (NSW) ("the Tax Act") in respect of the taxable value of land owned at midnight on a specified date and a detailed regime for assessment and collection was provided by the Land Tax Management Act 1956 (NSW) ("the Management Act"). The tax was both imposed and charged upon the land immediately on that date and did not wait upon the issue of an assessment4. The particular provisions which founded the assessments of Paliflex were enacted by the State Revenue Legislation Amendment Act 1997 (NSW) ("the 1997 Act"). The operative provisions of the 1997 Act5 amended the Tax Act and stated that, in respect of the taxable value owned by any person at midnight on 31 December 1997 and 1998, land tax at the scheduled rates was to be paid for the period of 12 months commencing on 1 January in the next succeeding year and in the manner prescribed under the Management Act. 2 Paliflex Pty Ltd v Chief Commissioner of State Revenue (NSW) 2002 ATC 4,124. 3 Paliflex Pty Ltd v Chief Commissioner of State Revenue (NSW) 2002 ATC 5,015. 4 Tooth & Co Ltd v Newcastle Developments Ltd (1966) 116 CLR 167 at 170. 5 Sched 2, Items 4, 5. McHugh Kirby Hayne The land tax system thus illustrates the dictum of Isaacs J with respect to the previous federal tax system, pursuant to the Land Tax Act 1910 (Cth) and the Land Tax Assessment Act 1910 (Cth), that6: "[t]he taxing Act is always speaking in the present. It does not affect to change or menace men's actions, but is a standing declaration of the law with respect to landed estates as they appear to exist at a given moment." Mason P rejected the submissions for Paliflex which he treated as7: "characterising [the Management Act and the Tax Act] as laws with respect to a Commonwealth place that were struck down at birth (1956) as regards the subject land; and were incapable of rising to touch it during a later era of private ownership unless reenacted generally or otherwise made to apply to the land by a specific enactment after [the registration of the transfer on] 4 February 1998", and as putting a case8: land because, "that the [Management Act] was and remains invalid in its application to the [Management Act] was the subject characterised as a the 'places acquired by law with respect Commonwealth for public purposes' and because no legislation enacted after 4 February 1998 reinstated the [Management Act] in its application to the subject land". His Honour concluded the that, upon Management Act and the Tax Act "failed to engage" with the Land in 1956, and s 52(i) did not operate to deny State legislative competence9. It is implicit in the reasoning of Mason P that the liability which later descended upon Paliflex by their proper construction, 6 Attorney-General for Queensland v Attorney-General for the Commonwealth (1915) 20 CLR 148 at 174. The relevant date under that legislation was the 30 June immediately preceding the year for which the land tax was levied and there was no provision for apportionment: Rabett v Forrest (1918) 18 SR (NSW) 131. 7 2002 ATC 4,124 at 4,127. 8 2002 ATC 4,124 at 4,128. 9 2002 ATC 4,124 at 4,128-4,129. McHugh Kirby Hayne reason of its ownership of the Land on 31 December 1998 and 31 December 1999 was not pursuant to any State law with respect to a place acquired by the Commonwealth for public purposes, within the meaning of s 52(i) of the Constitution. The conclusion that the relevant State legislation had no invalid operation with respect to the Land made it unnecessary for Mason P to determine any questions respecting s 14(2) of the Commonwealth Places (Administration of Laws) Act 1970 (NSW) ("the State Administration Act"). That legislation deals, among other topics, with the application of State laws when a place ceases to be a place to which s 52(i) of the Constitution applies. Subject to a qualification not presently relevant, s 14(2) states: "Subject to subsection (3), when a place ceases or has ceased to be a Commonwealth place at a particular time the laws of the State in force at that particular time apply or shall be deemed to have applied in or in relation to that place as if those laws had come into operation at that particular time and every Act, whether passed before or after the commencement of this Act, and every instrument made or having effect under any such Act, shall be read and construed as if it provided expressly that it was intended to so apply or to have so applied." Section 14(2) was enacted in apparent anticipation of certain statements by this Court in Attorney-General (NSW) v Stocks and Holdings (Constructors) Pty Ltd10. These may suggest that, upon the transfer of that land which is the relevant place acquired by the Commonwealth for public purposes, the land ceases to attract the continued exercise of the exclusive federal legislative power and that State law may validly apply by a reference point which is fixed by the loss of the character of the land as a Commonwealth place. The Court of Appeal disagreed with the reasoning of Mason P and went on to decide that Stocks and Holdings required a holding that s 14(2) of the State Administration Act was invalid. The Court of Appeal upheld the validity of the assessments of Paliflex to land tax, but only by reliance upon what was identified the the Mirror Taxes Legislation enacted in 199811 and including 10 (1970) 124 CLR 262 at 267 per Barwick CJ, 275-276 per Menzies J, 280-281 per Windeyer J; cf at 285, 289 per Walsh J. 11 Commonwealth Places (Mirror Taxes) Act 1998 (Cth), Commonwealth Places (Mirror Taxes Administration) Act 1998 (NSW). McHugh Kirby Hayne Commonwealth Places (Mirror Taxes) Regulations 2000 (Cth) and an Arrangement dated 14 February 2002 between the Governor-General and the Governor of New South Wales pursuant to that legislation. The Paliflex submissions Paliflex in this Court attacked the validity of the Mirror Taxes Legislation on various grounds. The appeal should be decided adversely to Paliflex without any reliance upon the Mirror Taxes Legislation to support the assessments and recovery of land tax. Thus, the Court should not enter upon those questions of alleged invalidity. Two necessary steps in the submissions by Paliflex in this Court are that (i) the land tax legislation never applied to the Land at any time after 1956 but, contrary to the holding of Mason P, this was by reason of the denial of State legislative competency by s 52(i) of the Constitution; (ii) s 14(2) of the State Administration Act is invalid. This is said to be on the ground that a federal law tracking the terms of s 14(2) would be supported by s 52(i) of the Constitution; it would have a sufficiently close connection with the Land as a place acquired by the Commonwealth for public purposes, despite its transfer to Paliflex, so that the existence of the exclusive federal power denies that of the State to enact s 14(2). The position which this Court should accept is that at no relevant time since 1956 have the Tax Act and the Management Act had any invalid application to the Land. More precisely, (i) the New South Wales land tax legislation was not invalid when enacted in 1956; there was no purported exercise by the State of what was the exclusive federal power conferred by s 52(i) of the Constitution; (ii) the Land ceased to have the character of a place acquired by the Commonwealth for public purposes on the registration of the transfer to Paliflex on 4 February 1998; and (iii) in its application to the Land on the critical dates of 31 December 1998 and 31 December 1999, the State legislation was not an exercise of power with respect to a place acquired by the Commonwealth for public purposes. These conclusions made it unnecessary formally to determine the validity of s 14(2) of the State Administration Act, but its validity is implicit in the reasoning leading to the above conclusions. The situation in 1956 We turn to consider proposition (i) listed in [16] above and thus to the situation in 1956 when the Tax Act and the Management Act were enacted. At that stage the Land was "property of any kind belonging to the Commonwealth" within the meaning of s 114 of the Constitution and so, without the consent of the McHugh Kirby Hayne Parliament of the Commonwealth, New South Wales could not impose any tax upon it. Further, the Land was one of the "places acquired by the Commonwealth for public purposes" within the meaning of s 52(i) of the Constitution. The Land had been acquired in 1922, but the phrase "acquired by the Commonwealth" carries within itself the notion of being the property of the Commonwealth as a consequence of that acquisition. In Essendon Corporation v Criterion Theatres Ltd12, decided in 1947, this Court had considered s 265(b) of the Local Government Act 1928 (Vic). This provided for the levying of municipal rates "[u]pon every person who occupies ... or if the occupier is the Crown ... then upon the owner" of the rateable property. The Commonwealth was the occupier of the relevant land for defence purposes. But it was held that it was not "the Crown" for the purposes of s 265(b). Nor was the Commonwealth a "person" who occupied the property. The upshot was that liability for rates was not imposed by s 265(b) upon the owner of the land, Criterion Theatres Ltd. One of the grounds of decision taken by Latham CJ was that to construe the phrase "every person" so as to include the Commonwealth would be to impose a tax upon it contrary to s 114 of the Constitution13. Further, both McTiernan J and Williams J14 had stressed that the phrase "every person" ordinarily is not construed as including a body politic. Dixon J had based his decision upon the ground that, independently of what might be the operation of s 114, it was a necessary consequence of the system of government established by the Constitution that the Constitution did not permit the taxing by a State law of the occupation of land for the carrying on by the Commonwealth of measures of defence15. His Honour also had emphasised that the presumption was that in a State statute references to the Crown did not cover the Commonwealth16. 12 (1947) 74 CLR 1. 13 (1947) 74 CLR 1 at 13; cf Bevelon Investments Pty Ltd v Melbourne City Council (1976) 135 CLR 530 at 536-537, 538-539, 544, 548-549, 551. 14 (1947) 74 CLR 1 at 28, 30. 15 (1947) 74 CLR 1 at 18, 22. See also Austin v Commonwealth (2003) 77 ALJR 491; 195 ALR 321. 16 (1947) 74 CLR 1 at 26. See also Commonwealth v Western Australia (1999) 196 CLR 392 at 432-433 [112]-[114]. McHugh Kirby Hayne The Management Act provided in s 7: "Subject to the provisions of this Act, land tax at such rates as may be fixed by any Act shall be levied and paid upon the unimproved value of all lands situated in New South Wales which are owned by taxpayers, and which are not exempt from taxation under this Act." That was to be read with s 9(1) which stated: "Land tax shall be payable by the owner of land upon the taxable value of all the land owned by him and not exempt from taxation under this Act." The term "taxpayer" was defined in s 3 as meaning "any person chargeable with land tax", and "owner" was so defined as to include "every person" deemed by provisions such as s 32 (dealing with occupation, control or use by non-owners) to be the owner. In respect of the Land, there was no third party who could have been classified as a deemed owner. Further, the Commonwealth was not, upon the proper construction of the Management Act by application of the principles referred to in Essendon Corporation, an "owner" or a "taxpayer". The Land was situated in New South Wales within the meaning of s 7 of the Management Act, but it was not "owned" by a "taxpayer" as that section also required. These conclusions are further supported by the opening words of s 2 of the Management Act, reflecting an awareness both of s 114 and of the doctrine of immunity explained by Dixon J in Essendon Corporation and developed very shortly thereafter in Melbourne Corporation v The Commonwealth17. Section 2 of the Management Act begins: "This Act shall be the Commonwealth of Australia Constitution Act, and so as not to exceed the legislative power of the State ...". read and construed subject The second limb of s 2 deals with severance to preserve partial validity. Provisions such as s 2 have appeared in a range of State laws18. Most of the 17 (1947) 74 CLR 31. 18 A general provision following the terms of s 2 was introduced as s 14A of the Interpretation Act 1897 (NSW) by the Interpretation (Amendment) Act 1969 (Footnote continues on next page) McHugh Kirby Hayne decided cases have dealt with the second limb19. However, the significance here of s 2 is in the confirmation by the first limb of a legislative intention, achieved by the subsequent sections to which reference has been made, to stay within the constraints imposed by the Constitution upon the exercise of the property taxing powers of the State legislature. It may be true that in 1956 the scope of s 52(i) of the Constitution was not appreciated20, but that of the other constraints was. The conclusion which follows is that the 1956 legislation was not a law with respect to the Land. The phrase "with respect to" appears in both s 51 and s 52 of the Constitution. It should be given no different meaning in s 52 to that in s 51. That this is so appears from Allders International Pty Ltd v Commissioner of State Revenue (Vict)21. Further, it is not to the point that the law in question may have several characterisations; the task is not to isolate one only of those characterisations as the sole determinant of the sufficiency of connection with the head of legislative power in question. Allders22 and earlier23 and subsequent24 authority confirm these propositions. In particular, Allders rejected the proposition which had been accepted in the Supreme Court of Victoria25 that the (NSW). The present provision in s 31 of the Interpretation Act 1987 (NSW) is expressed in different terms. 19 The cases include Carter v The Potato Marketing Board (1951) 84 CLR 460; Johnson v Commissioner of Stamp Duties [1956] AC 331. See also Harrington v Lowe (1996) 190 CLR 311 at 326-328. 20 See Rose, "The Commonwealth Places (Application of Laws) Act 1970", (1971) 4 Federal Law Review 263; Cowen, "Alsatias for Jack Sheppards?: The Law in Federal Enclaves in Australia", in Sir John Latham and Other Papers, (1965) 171 21 (1996) 186 CLR 630 at 641-642, 661-662, 673. 22 (1996) 186 CLR 630 at 640, 676. 23 See, eg, Northern Suburbs General Cemetery Reserve Trust v The Commonwealth (1993) 176 CLR 555 at 572. 24 See, eg, Grain Pool of Western Australia v Commonwealth (2000) 202 CLR 479 at 25 Allders International Pty Ltd v Commissioner of State Revenue of Victoria (1995) 129 ALR 678. McHugh Kirby Hayne stamp duty legislation could not be a law with respect to a Commonwealth place because it was a law with respect to instruments26. Allders also confirms27 that the boundaries of the power withdrawn by s 52(i) from the States are charted by the grant of exclusive power to the Commonwealth, so that a useful test is to ask whether a federal law similar to the 1956 State legislation would be supported in any of its operations as a law with respect to the Land. The answer must be that such a law would have no connection with the Land, accepting that something more than an insubstantial, tenuous or distant connection is required by the authorities just mentioned. The primary submission, put particularly clearly by the Attorney-General for Victoria as an intervener, should be accepted. The State legislation was not a law with respect to the Land whilst it had the character of a place acquired by the Commonwealth for public purposes; the legislation did not purport to regulate the conduct of persons there, or have any real and substantial impact upon that place. Stocks and Holdings The decision in Stocks and Holdings does not present any obstacle in the path of these conclusions. The land with which that case was concerned had been acquired by the Commonwealth in 1929 as a place for public purposes, namely a rifle range for the defence forces. On 27 June 1951, the County of Cumberland Planning Scheme ("the Scheme") came into force pursuant to the Local Government (Amendment) Act 1951 (NSW) which amended the Local Government Act 1919 (NSW) ("the LG Act"). At that time the land was in use by the Commonwealth for the Long Bay Rifle Range. Stocks and Holdings (Constructors) Pty Ltd later acquired the land at some point prior to 7 February 1968 from the Randwick Council, to which it had been transferred by the Commonwealth in 1965. The first question for the consideration of the Full Court of this Court asked whether, upon the Commonwealth of Australia as owner of the subject land". All five members of the Court answered "No", but, without further explanation to be derived from the the Scheme "bound its enactment 26 (1996) 186 CLR 630 at 641-642, 675-676. 27 (1996) 186 CLR 630 at 638, 676. McHugh Kirby Hayne reasons, the answer is equivocal. That is because the Scheme might not on its own terms have attempted to bind the Commonwealth, or it may have purported to do so but the attempt failed for the denial of State legislative power by s 52(i) of the Constitution. In submissions28 reliance had been placed upon the interpretation given to s 109 of the Constitution in Butler v Attorney-General (Vict)29. This was that the phrase in s 109, "to the extent of the inconsistency, be invalid", means not that the State law is beyond legislative power but that it has no legal operation for so long as the federal law is in force. The submission, as recorded by Barwick CJ30, had been that the Scheme: "should be construed as if it contained a provision that its terms should not apply to land being a place or forming part of a place acquired by the Commonwealth for public purposes so long as the Commonwealth should own or possess such place but that it should apply so soon as the Commonwealth ceased to own or to possess the place". "In my opinion, there are two answers to this submission. The first is that it would not be, in my opinion, an exercise of construction to import such a provision into the scheme. It would, in my opinion, amount to an attempt to legislate. But secondly and more importantly such a provision, in my opinion, would itself offend s 52(i) for the reasons expressed by my 28 (1970) 124 CLR 262 at 265. 29 (1961) 106 CLR 268. 30 (1970) 124 CLR 262 at 267. 31 (1970) 124 CLR 262 at 267. McHugh Kirby Hayne Walsh J32 concluded that, even if the Scheme were construed as suggested, it would still offend s 52(i). His Honour said33: "It is only if the provisions should be understood as having no application at all to lands which had been acquired by the Commonwealth for public purposes and were still held by it, that the Ordinance would avoid the consequences of s 52(i). But if so understood, those lands, although marked upon the map, would not be within the scheme. The scheme would not apply to them." "In my opinion the Ordinance in question, which purported on its face, by cll 26-29, to require the consent of the responsible authority before any building might be erected on the range or the land used for any purpose, was a law with respect to the rifle range. The range was delineated and coloured grey on the scheme map which showed the details of the planning scheme. This colour indicated a 'Special Uses Area'. It is stated in cl 3 that 'special uses' include the use of land or buildings for defence areas." Menzies J put the matter rather differently, saying35: "[T]he Long Bay Rifle Range was at all times within the scheme but ... the scheme imposed no limitation with respect to its use until the land had been acquired from the Commonwealth by the Council, ie until it ceased to be a place acquired by the Commonwealth." Windeyer J36 construed the Scheme as containing an implication that it did "not encroach upon matters the Commonwealth". the exclusive power of that are within 32 (1970) 124 CLR 262 at 288. 33 (1970) 124 CLR 262 at 288. 34 (1970) 124 CLR 262 at 269. 35 (1970) 124 CLR 262 at 278. 36 (1970) 124 CLR 262 at 280. McHugh Kirby Hayne The Tax Act and the Management Act are not concerned with the uses to which any land within a delineated geographic area may be put. They impose fiscal burdens only upon those "owners" who are "taxpayers". These are terms which did not include the Commonwealth. Thus, unlike the situation in Stocks and Holdings, there is no occasion to read down the 1956 legislation to preserve its validity. Nor, that being so, does one find an attempted reading down which would produce a text which itself would fall foul of s 52(i), as did the proposed reading down in Stocks and Holdings. The present case thus falls for decision without the initial complexities which attended the reading in Stocks and Holdings of the Scheme at the time of its commencement. If the premise for the decision in Stocks and Holdings was that the Scheme, in its terms, was a law with respect to a place acquired by the Commonwealth for public purposes, that premise is absent here. The case for Paliflex has to accept that, whilst the Land was owned by the Commonwealth, there was no State law which was a law with respect to it and so tainted by s 52(i) of the Constitution. The question presented in Stocks and Holdings – whether a law with respect to a place acquired by the Commonwealth for public purposes could be read down in such a way that it would no longer bear that characterisation – does not arise. That being so, there is no occasion to reconsider Stocks and Holdings. The situation after the transfer to Paliflex How then does the State legislation fail to support the assessments of Paliflex to tax imposed by reason of its ownership of the Land at dates subsequent to the registration of the transfer by the Commonwealth? The answer, particularly as developed by Paliflex in oral submissions, appeared to depend upon two related propositions. One is that the land tax legislation altered the "incidents of title" to the Land even while it was owned by the Commonwealth because it was apt to decrease the consideration Paliflex had been prepared to pay to acquire it, or any purchaser of the Spencer species37 would have been prepared to pay. Secondly, s 52(i), it was said, protected against State legislative interference with the interest of the Commonwealth in parting with places held by it for public purposes by turning them to maximum revenue account. 37 Spencer v The Commonwealth (1907) 5 CLR 418 at 431-432. McHugh Kirby Hayne Hence, the submission appears to be that it is within the exclusive legislative competence of the Commonwealth to insulate Paliflex (and, perhaps, subsequent owners of the Land) from the imposition of land tax by reason of ownership of the Land at times after registration of a transfer by the Commonwealth. In argument, Paliflex propounded a federal law supported by s 52(i), the text of which was: "A person who acquires a Commonwealth place from the Commonwealth shall not, at the time of acquisition by that person, be then exposed by any enactment of the State to any tax referable to that person's ownership of the place." There is an immediate difficulty with these submissions. It is of an evidentiary nature. The agreed facts do not reveal the manner of, nor considerations which affected, the computation of the purchase price and its acceptance by the Commonwealth as vendor. Further, there may be a real question about what significance is to be attached to economic consequences of the kind asserted in deciding whether an impugned law is a law with respect to a subject-matter identified in s 52(i). As Kitto J said in Fairfax v Federal Commissioner of Taxation38, the question of constitutional validity under s 51 of the Constitution: "is always one of subject matter, to be determined by reference solely to the operation which the enactment has if it be valid, that is to say by reference to the nature of the rights, duties, powers and privileges which it changes, regulates or abolishes; it is a question as to the true nature and character of the legislation: is it in its real substance a law upon, 'with respect to', one or more of the enumerated subjects, or is there no more in it in relation to any of those subjects than an interference so incidental as not in truth to affect its character?"39 38 (1965) 114 CLR 1 at 7. 39 Kitto J referred to Bank of New South Wales v The Commonwealth (1948) 76 CLR 1 at 185-187 per Latham CJ, and Huddart Parker & Co Pty Ltd v Moorehead (1909) 8 CLR 330 at 409-411 per Higgins J. See also Re Dingjan; Ex parte Wagner (1995) 183 CLR 323 at 334 per Mason CJ, 336-337 per Brennan J, 351-352 per Toohey J; Leask v The Commonwealth (1996) 187 CLR 579 at (Footnote continues on next page) McHugh Kirby Hayne It is unnecessary to explore this question of the significance to be given to economic consequences further than to notice that Fairfax was a case in which the economic consequences of the impugned law were held not to deny its character as a law with respect to taxation. There are considerations flowing from the scope and purpose of s 52(i) of the Constitution which, in any event, indicate that the assumptions in Paliflex's submissions should not be accepted. The scope and purpose of s 52(i) Section 52 of the Constitution states: "The Parliament shall, subject to this Constitution, have exclusive power to make laws for the peace, order, and good government of the Commonwealth with respect to: the seat of government of the Commonwealth, and all places acquired by the Commonwealth for public purposes; (ii) matters relating to any department of the public service the control of which is by this Constitution transferred to the Executive Government of the Commonwealth; (iii) other matters declared by this Constitution to be within the exclusive power of the Parliament." In Svikart v Stewart40, Mason CJ, Deane, Dawson and McHugh JJ observed that the terminology of s 52(i) reflected that of cl 17 of s 8 of Art I of the United States Constitution, and that "the American experience was instructive" in the drafting of s 52. The United States provision is as follows: 590-591 per Brennan CJ, 634 per Kirby J; Kartinyeri v Commonwealth (1998) 195 CLR 337 at 372 [58] per Gummow and Hayne JJ; Re Pacific Coal Pty Ltd; Ex parte Construction, Forestry, Mining and Energy Union (2000) 203 CLR 346 at 411 [202] per Gummow and Hayne JJ; and the judgment of the Court in Re Maritime Union of Australia; Ex parte CSL Pacific Inc (2003) 200 ALR 39 at 48 40 (1994) 181 CLR 548 at 561. McHugh Kirby Hayne "The Congress shall have Power ... To exercise exclusive Legislation in all Cases whatsoever, over such District (not exceeding ten Miles square) as may, by Cession of Particular States, and the Acceptance of Congress, become the Seat of the Government of the United States, and to exercise like Authority over all Places purchased by the Consent of the Legislature of the State in which the Same shall be, for the Erection of Forts, Magazines, Arsenals, dock-Yards and other needful Buildings". The phrase "other needful Buildings" extends to "whatever structures are found to be necessary the Federal Government"41, and includes court buildings, customs houses, and locks and dams for the improvement of navigation42. the performance of the functions of In the joint reasons in Svikart, their Honours said of the United States provision43: "The first part of cl 17, relating to the seat of government, is said to have been prompted by occurrences which took place near the close of the Revolutionary War when Congress in session in Philadelphia was surrounded and insulted by a body of mutineers of the Continental Army and the State did little to assist44. The second part, dealing with places purchased with the consent of the State, was thought necessary so that the consent of the State would carry with it political dominion and legislative authority. This was before the right of eminent domain was recognized45, and the view was that, in the case of land acquired without consent, the possession of the United States would be simply that of an ordinary proprietor subject to the legislative authority and control of the State46." 41 James v Dravo Contracting Co 302 US 134 at 143 (1937). 42 James v Dravo Contracting Co 302 US 134 at 142-143 (1937). 43 (1994) 181 CLR 548 at 559. 44 See Spratt v Hermes (1965) 114 CLR 226 at 273. 45 See Kohl v United States 91 US 367 (1875). 46 See Fort Leavenworth Railroad Co v Lowe 114 US 525 at 538, 542 (1885). McHugh Kirby Hayne Special considerations attend the first limb of s 52(i), that concerned with the seat of government of the Commonwealth. Section 125 required that seat to be within territory in New South Wales which was to be granted to or acquired by the Commonwealth. It was held in Svikart47, and affirmed in Re the Governor, Goulburn Correctional Centre; Ex parte Eastman48, that the seat of government and the Australian Capital Territory are not synonymous terms. The result is that s 122 has a large part to play and the power under the first limb of s 52(i) is concerned with political or constitutional aspects of the seat of government rather than with the government of the territory in which it is found. In Svikart, Mason CJ, Deane, Dawson and McHugh JJ concluded49 that the second limb of s 52(i) was intended to provide for exclusive Commonwealth the to places legislative power with respect Commonwealth and that: in a State acquired by "[t]o achieve this in an Australian context there was no need, as there was in the United States, to think in terms of territorial sovereignty. It was sufficient that acquisition of property should carry with it legislative authority without political dominion." To that, reference to s 8550 of the Constitution and to s 51(xxxi) might be added. the In particular, itself vested certain State property (a) s 85(i) 47 (1994) 181 CLR 548 at 561. 48 (1999) 200 CLR 322 at 333-334 [14], 335-336 [22], 353 [82], 369 [120]. 49 (1994) 181 CLR 548 at 560-561. 50 Section 85 states: "When any department of the public service of a State is transferred to the Commonwealth: all property of the State of any kind, used exclusively in connexion with the department, shall become vested in the Commonwealth; but, in the case of the departments controlling customs and excise and bounties, for such time only as the Governor-General in Council may declare to be necessary; the Commonwealth may acquire any property of the State, of any kind used, but not exclusively used in connexion with the (Footnote continues on next page) McHugh Kirby Hayne Commonwealth51, but with an obligation under s 85(iii) to provide compensation; (b) s 85(ii) conferred a specific power of acquisition of State property but for value; and (c) in so far as the acquisition of the place in question was the result of the exercise upon the State or any person of other compulsive powers, s 51(xxxi) required the acquisition to have been on just terms and for a purpose in respect of which the Parliament had power to make laws. Further, where the acquisition is the product, not of the exercise of powers of compulsion, but of agreement then, whilst s 51(xxxi) will have no application52, s 52(i) will. The United States position has developed rather differently in several respects. First, it was only in the second half of the nineteenth century that it was established by Kohl v United States53 and Fort Leavenworth Railroad Co v Lowe54 that the United States held a right of eminent domain "to take private property for public uses when needed to execute the powers conferred by the Constitution"55 and this right was not dependent upon purchase by consent of the department; the value thereof shall, if no agreement can be made, be ascertained in, as nearly as may be, the manner in which the value of land, or of an interest in land, taken by the State for public purposes is ascertained under the law of the State in force at the establishment of the Commonwealth; (iii) the Commonwealth shall compensate the State for the value of any property passing to the Commonwealth under this section; if no agreement can be made as to the mode of compensation, it shall be determined under laws to be made by the Parliament; the Commonwealth shall, at the date of the transfer, assume the current obligations of the State in respect of the department transferred." 51 See R v Bamford (1901) 1 SR (NSW) 337. 52 Trade Practices Commission v Tooth & Co Ltd (1979) 142 CLR 397 at 416-417. 55 114 US 525 at 531 (1885). McHugh Kirby Hayne State legislature required by cl 17 of s 8 of Art I of the Constitution56. Secondly, it has been held that cl 17 is applicable to cases where the State conveys land for a purpose specified therein but reserves and the United States accepts "concurrent jurisdiction" which is "not inconsistent with the jurisdiction ceded to the United States"57. Finally, it was established in Collins v Yosemite Park Co58 that a State may convey, and the Congress may accept, either exclusive or qualified jurisdiction over property acquired, within the geographical limits of a State, for purposes other than those identified in cl 17. These purposes include forests, parks, ranges, wild life sanctuaries and flood control59. However, the United States jurisprudence does assist in indicating the values of federalism which underpin both cl 17 and s 52(i). Writing in The Federalist60, Madison explained the necessity of federal authority over forts, magazines and other "needful buildings" as being that61: "[t]he public money expended on such places, and the public property deposited in them, require that they should be exempt from the authority of the particular State". Thereafter, in Fort Leavenworth62, Field J adopted what had been said in this passage from The Federalist. A significant pointer in the same direction is provided by the phrase in s 52(i) "acquired by the Commonwealth for public purposes" (emphasis added). 56 Worthing v Rowell and Muston Pty Ltd (1970) 123 CLR 89 at 99. 57 James v Dravo Contracting Co 302 US 134 at 145 (1937). 58 304 US 518 at 528-530 (1938). 59 304 US 518 at 529-530 (1938). 60 Essay No 43, 23 January 1788. 61 Kurland and Lerner (eds), The Founders' Constitution, (1987), vol 3 at 219. See also Story, Commentaries on the Constitution of the United States, (1833), vol 3, 62 114 US 525 at 530 (1885). McHugh Kirby Hayne In Worthing v Rowell and Muston Pty Ltd63, Windeyer J said that these words "express a large and general idea". The terms "public use" and "public purpose" had had even before Federation a lengthy and significant history in Australia, particularly with respect to reservations from powers of disposition of the "waste lands" of the Crown64. In Worthing65, Windeyer J expressed the view that the method of acquisition might be by "any process known to the law", including by voluntary disposition inter vivos or testamentary disposition in favour of the Commonwealth. His Honour continued66: "And public purposes are not necessarily purposes for which the Parliament can make laws. I can see no reason why the Commonwealth, or a Commonwealth statutory body on behalf of the Commonwealth, should not be able to accept a gift from a landowner by his deed or will of land for the purpose, say, of a public park, just as I suppose it could become by gift possessed of pictures or books for public use and enjoyment." It is unnecessary for this appeal to determine whether these propositions as to the scope of the phrase "acquired ... for public purposes" in s 52(i) are to be accepted. What is significant is that (a) the "public purposes" spoken of in s 52(i) include at least those in respect of which the Parliament otherwise has power to make laws67 and (b) the word "for" is indicative of a continued or continuing end to be attained or object met by the retention by the Commonwealth of the property consequent upon that process of law by which it was acquired. That retention thus has "a purposive aspect"68. The pursuit of 63 (1970) 123 CLR 89 at 125. 64 Bathurst City Council v PWC Properties Pty Ltd (1998) 195 CLR 566 at 589-590 [58]-[59]; Western Australia v Ward (2002) 76 ALJR 1098 at 1147-1155 [197]- [244]; 191 ALR 1 at 69-81. 65 (1970) 123 CLR 89 at 127. 66 (1970) 123 CLR 89 at 127. 67 cf Victoria v The Commonwealth and Hayden ("the Australian Assistance Plan Case") (1975) 134 CLR 338. 68 cf Victoria v The Commonwealth (Industrial Relations Act Case) (1996) 187 CLR McHugh Kirby Hayne purpose is insulated against the intrusion of State legislative power by the reach of the phrase "with respect to" in the identification of the exclusivity of federal legislative power. The question will be whether the State law in question has a connection with the place concerned which is more than insubstantial, tenuous or distant. In Stocks and Holdings, both Menzies J69 and Windeyer J70 referred to the decision of the Supreme Court of the United States in SRA Inc v Minnesota71 in support of the construction of s 52(i). Windeyer J expressed his conclusion by relating it to the facts in Stocks and Holdings by saying72: "In 1965 the Commonwealth, no longer requiring the whole of its rifle range land, disposed of part by transfer to the Council of the Municipality of Randwick; and later the Council transferred a part of what it had thus acquired to the defendant, Stocks and Holdings (Constructors) Pty Ltd, which proposes to build an hotel there. As I read s 52 of the Constitution, the exclusive power of the Commonwealth with respect to a place it has acquired subsists only so long as it holds the place for that purpose. If the Commonwealth transfers land to the State, it becomes land of the Crown in right of the State. If the Commonwealth transfers it absolutely to a person, it becomes vested in the transferee as tenant in fee simple in right of the State. In either event the authority of the Commonwealth Parliament in respect of the place comes to an end: and so, in my view, do any laws that the Parliament made by virtue only of its exclusive power to make laws with respect to the place, unless the State Parliament legislates to keep them alive. This result flows from the nature of the Commonwealth power under s 52 with respect to places." (emphasis added) Menzies J described73 s 52(i) as an exclusive power to make laws for property so long as it fulfils the description of a place "acquired by the Commonwealth for 69 (1970) 124 CLR 262 at 276-277. 70 (1970) 124 CLR 262 at 280-281. 72 (1970) 124 CLR 262 at 280-281. 73 (1970) 124 CLR 262 at 277. McHugh Kirby Hayne public purposes" but not thereafter. The reasoning of Menzies J and Windeyer J reflected the statement in SRA Inc74: "As the purpose of Clause 17 was to give control over the sites of governmental operations to the United States, when such control was deemed essential for federal activities, it would seem that the sovereignty of the United States would end with the reason for its existence and the disposition of the property." Conclusions with respect to the post-transfer period The construction of the exclusive federal legislative power in s 52(i) and the terminal point fixed by Menzies J and Windeyer J should be accepted. That has fatal consequences for the submissions by Paliflex. The land tax legislation in its support of the liability of Paliflex to land tax by reason of its ownership of the Land on 31 December 1998 and 1999 was not a law with respect to a place acquired by the Commonwealth for public purposes. The land tax legislation did not create or impose any obligation or duty upon the owner of the Land until a date after the registration of the transfer to Paliflex. That may be contrasted with the operation of the stamp duty law upon the transfer of the Land to Paliflex. That duty was imposed upon the instrument by which the Land ceased to have the character of a place acquired by the Commonwealth for public purposes. The stamp duty law was a law with respect to the Land having that character and so trespassed upon the ground marked out by s 52(i). The interest or concern of the Commonwealth in aid of which s 52(i) gave to the Parliament exclusive legislative power subsisted for so long as the Commonwealth held the Land for public purposes and the grant of exclusive power was correspondingly circumscribed. That interest or concern did not extend to the exclusion of any exercise of State legislative power which might tax the ownership of the Land in the hand of a transferee from the Commonwealth. To the extent that it could be shown that the projected operation of a State tax regime might or could affect the price obtained on a transfer by the Commonwealth when land was no longer held for public purposes, the connection would be so insubstantial, tenuous and distant as to be beyond the preserve of federal exclusive legislative power. That is a 74 327 US 558 at 564 (1946). McHugh Kirby Hayne consequence of the construction of the second limb of s 52(i) which sees it as being concerned with the fulfilment of the public purpose, freed from any exercise of State legislative power with respect to the place. It was accepted in argument that there was contained within the exclusive grant in s 52(i) everything incidental to the main purpose of the power, within the sense of McCulloch v Maryland75. Without determining the point, it also may be accepted that, although found in s 51, the grant of law-making power with respect to matters incidental to the execution of legislative powers, conferred by par (xxxix), extends to the incidents in the exercise of the grant in s 52(i). The hypothetical federal law which would immunise Paliflex from liability to land tax would not be incidental to the main purpose of the grant in s 52(i), and would not concern the incidents of the exercise of that grant. It remains to indicate that nothing inconsistent with the above reasoning appears in the treatment by the majority of the third question in Stocks and Holdings. After the transfer of the land by the Commonwealth to Randwick Council in 1965, a new interim development order ("the IDO") was made after suspension by the Minister of the pre-existing Scheme. It was held (Menzies J and Windeyer J dissenting) that upon the true construction of s 342Y of the LG Act the exercise of the power to make the IDO was conditioned upon the continued and valid operation with respect to the land in question of the Scheme the IDO superseded. As explained earlier in these reasons, the Scheme did not have that valid operation. For this reason, dependent upon the construction of s 342Y, not s 52(i) of the Constitution, the majority76 answered "No" the question whether the notification of the IDO in 1965 bound the then owner and subsequent owners, including Stocks and Holdings. Orders For these reasons, which depart from those of the Court of Appeal, the appeal should be dismissed with costs. 75 17 US 159 at 206 (1819). See also Le Mesurier v Connor (1929) 42 CLR 481 at 76 (1970) 124 CLR 262 at 268 per Barwick CJ, 270 per McTiernan J, 289-292 per Callinan CALLINAN J. The facts, the relevant legislation and authorities, the submissions of the parties, and the course of the proceedings are fully stated in the judgment of Gleeson CJ, McHugh, Gummow, Kirby and Hayne JJ in whose proposed orders I would join. The propositions advanced by the appellant immediately strike one as improbable, if not extraordinary. A State law is enacted in respect of land owned at the time of its enactment by the Commonwealth. That law cannot (absent valid mirror or applicable other subsequent legislation) have any valid operation in relation to that land no matter that it may have passed into other hands. Just how improbable the proposition is was brought home during the appellant's submissions when it was unable to say, when challenged, for how long, and for how many successive ownerships the asserted immunity from the State law should or could endure. Were it not for the decision of this Court in Allders International Pty Ltd v Commissioner of State Revenue (Vict)77 and Attorney- General (NSW) v Stocks and Holdings (Constructors) Pty Ltd78 ("Stocks & Holdings"), it is doubtful whether the appellant's arguments could have been credibly advanced at all. The appeal fails on the basis that the two State enactments, the Land Tax Management Act 1956 (NSW) ("the LTMA") and the Land Tax Act 1956 (NSW), never had, or purported to have any application to the Commonwealth and any land owned by it within the State. Each of, and in combination, ss 3, 7 and 9 of the LTMA, the sections by which land tax is levied, refer or are intended to operate in relation to "land ... owned by taxpayers". As the Commonwealth is not a taxpayer it does not answer that description. Furthermore, the Commonwealth is, to put it at its lowest, constitutionally exempt from any obligation to pay land tax to the State. Statements made by some members of the Court in Stocks & Holdings need to be read in the light of the first in particular of the questions stated and answered in that case79: "(1) Whether upon its enactment on 27th June 1951, the County of the Scheme Ordinance Cumberland Commonwealth as owner of the subject land. Planning bound 77 (1996) 186 CLR 630. 78 (1970) 124 CLR 262. 79 (1970) 124 CLR 262 at 292. Callinan Walsh J (with whom Barwick CJ generally agreed80) said this of the State Act and Ordinance under consideration there81: "If upon their proper construction, the 1951 Act and the Ordinance applied to the rifle range land, I think that those enactments must be held to have been to that extent beyond power and invalid. Unless they should be construed as less extensive in meaning than their general terms would indicate, they cannot be held to be wholly valid. It was submitted that the provisions should be by construction confined so that they do not exceed what the Parliament of the State was competent to enact. The learned Solicitor-General for New South Wales submitted that the provisions were not intended to bind the Commonwealth or the land, whilst it remained in Commonwealth ownership, but were intended to bind the land and the owners of it for the time being (whether individuals, corporations or States) after the cessation of Commonwealth ownership. The submission is not simply that the provisions should be construed as not binding the Commonwealth. It is that they should be construed as not intended 'to bind the land' so long as it is owned by the Commonwealth ... To the extent that the 1951 Act and its Schedule should be read as having even the limited application to the land which the informant's arguments must postulate, it would be in my opinion invalid because of s 52(i). I do not mean that there would be any invalidity in showing the land on the map to which the Act refers in order to make it easier to understand the map or simply for the purpose of identifying land and stating facts as to its existing ownership and use. But if no more than that was done, I think that the land would not be brought within the scheme. It would not be land to which the scheme 'applies'. On the other hand, if the enactment is read as making the scheme apply to the land, and as issuing directions as to its use, whether in the present or in the future, I think that it is to that extent beyond legislative power." (emphasis added) McTiernan J reached the same conclusion for similar reasons82. Menzies J expressed, with respect, a persuasive different view83. Stocks & Holdings may however be distinguished. The presence and language of s 7 of the LTMA relevantly bring that Act within the qualification 80 (1970) 124 CLR 262 at 266. 81 (1970) 124 CLR 262 at 285-287. 82 (1970) 124 CLR 262 at 269. 83 (1970) 124 CLR 262 at 275. Callinan expressed by Walsh J in the first two sentences of the passages in his judgment that I have quoted. Section 7 is a provision which states in terms that the apparently general language "all land" is qualified, and is to be confined to "land owned by a taxpayer" or, to put it in the negative, to "land not owned by a non-taxpayer". Accordingly, it is not necessary, as the Court was invited to do, to re-open Stocks & Holdings, or to consider whether the view of Menzies J on this point should be preferred84: "Here, it seems to me, that the exclusion of the Commonwealth and of Commonwealth land from the restrictions and prohibitions of the scheme was so obviously necessary for validity that it is proper to conclude that such exclusion was intended, and, the mere fact that there are no express words of exclusion, does not warrant the invalidation of the scheme as a whole." Nor is it necessary to explore a further possible, at least apparently valid, point of distinction: that because what was in issue there was a planning scheme, applying not only to the rifle range, but also to other land surrounding and near to it, the scheme at the time of its enactment had to be viewed, unlike for example, a land tax enactment, as a composite whole, which for its practical utility had to be wholly valid in its application to all lands to which it purported to apply. In a planning scheme the use to which one parcel of land is to be put may well influence the permissible or desirable uses of other land covered by the scheme and vice versa85. The appellant contended that the two Acts burdened Commonwealth land. It was unable to identify any effect upon it however, except as to its value: in short that the Commonwealth could sell it for more if it were exempt from land tax. Attempts by the appellant to liken this circumstance to a defect in title were unconvincing. That the Commonwealth might get a better price if it could immunise land it owned from land tax for a period, or indefinitely, has nothing to say about the nature and completeness of the title that it can convey. Apart from the more obvious policy considerations arguing against the result sought by the appellant, that land no longer in Commonwealth ownership and therefore no longer used for any public purpose should nonetheless continue to have a tax free status, there is this. The Commonwealth owned no land at the time of Federation. Everything it has (apart from land transferred or ceded to it pursuant to ss 85 and 125 of the Constitution or given to it), must have been acquired either by purchase, overshadowed no doubt by its ultimate power of compulsory 84 (1970) 124 CLR 262 at 275. 85 cf Attorney-General (NSW) v Stocks and Holdings (Constructors) Pty Ltd (1970) 124 CLR 262 at 280 per Windeyer J. Callinan acquisition, or by compulsory acquisition. On acquisition it would have paid no additional sum for it because it was to be used for a Commonwealth public purpose, one relevant incident of which is freedom from State land tax. That follows from settled principle now enacted as s 60 of the Lands Acquisition Act 1989 (Cth) which relevantly provides: "In assessing compensation, there shall be disregarded: any special suitability or adaptability of the relevant land for a purpose for which it could only be used pursuant to a power conferred by or under law, or for which it could only be used by a government, public or local authority; any increase or decrease in the value of the land caused by the carrying out of, or the proposal to carry out, the purpose for which the interest was acquired; and An enactment under the Constitution may not of course be used to construe the Constitution, but s 60 of the Lands Acquisition Act reflects the law in force in relation to compulsory acquisitions at the time of Federation and of which the drafters may be taken to have known. That law is described in Corrie v MacDermott86 on appeal from this Court to the Privy Council which explained the much earlier cases of Hilcoat v Archbishops of Canterbury and York87 and Stebbing v Metropolitan Board of Works88. The principle was shortly stated as89: "The value which has to be assessed is the value to the old owner who parts with his property, not the value to the new owner who takes it over." It would be odd, if having acquired land for a price which was unaffected by the incidents of public ownership, an acquiring authority should be entitled to sell it to an ordinary purchaser at a price enhanced by the continuation of a status entirely inappropriate to its new ownership and usage. 86 (1914) 18 CLR 511; [1914] AC 1056. 87 (1850) 10 CB 327 [138 ER 132]. 88 (1870) LR 6 QB 37. 89 Corrie v MacDermott (1914) 18 CLR 511 at 514; [1914] AC 1056 at 1062. Callinan What I have said is sufficient to dispose of the appeal. It is unnecessary to deal with the applicability or otherwise of the mirror legislation to which the Court of Appeal had regard in deciding the appeal to it. The appeal should be dismissed with costs.

HIGH COURT OF AUSTRALIA NOMINAL DEFENDANT APPELLANT AND GLG AUSTRALIA PTY LIMITED & ORS RESPONDENTS Nominal Defendant v GLG Australia Pty Limited [2006] HCA 11 5 April 2006 ORDER Appeal allowed. Set aside the orders of the Court of Appeal of the Supreme Court of New South Wales dated 23 August 2004 and, in their place, order that the appeal to that Court be dismissed. The first respondent to repay the sum of $132,370.34 to the appellant plus interest calculated at $32.64 per day from 12 November 2004 until the date when this order takes effect. The order in paragraph (a) is suspended for seven days. In the event of the first respondent filing and serving written submissions within that period contending that the order in paragraph (a) is wrong: it will remain suspended until further order; and is directed file and serve written the appellant submissions in reply within a further seven days, and to apply within a further seven days to re-list the matter before a single Justice. The first respondent to pay the appellant's costs of the appeal to the Court of Appeal and of the proceedings in this Court. On appeal from the Supreme Court of New South Wales Representation: P J Deakin QC with P J Nolan for the appellant (instructed by Sparke Helmore) J E Maconachie QC with N J Polin for the first respondent (instructed by Curwood & Partners) Submitting appearance for the second respondent. Submitting appearance for the third respondent. Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Nominal Defendant v GLG Australia Pty Limited Statutes – Motor Accidents Act 1988 (NSW) ("the Act") – Scope of indemnity – Scope of definition of "injury" under s 3(1) of the Act – A system of work involving forklift vehicle produced vibrations causing boxes in container to fall and strike worker – Whether injury "is a result of and is caused during ... the driving of the vehicle" under par (a)(i) of the definition of "injury" – Whether Allianz Australia Insurance Ltd v GSF Australia Pty Ltd (2005) 79 ALJR 1079; 215 ALR 385 required definition of "injury" to be construed consistently with s 69(1) of the Act – Whether injury "caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle" – Whether fault in failing to devise a safe system of work can be invoked as basis of claim for indemnity under the Act – Causation – Whether direct and proximate relationship between the driving of the vehicle and the injuries. Statutes – Construction – Purpose of legislation – Extrinsic materials – Use of ministerial second reading speech – Whether any disparity between Minister's speech and law as enacted – Duty of courts to enacted law. Practice and procedure – Court of Appeal (NSW) – Orders disposing of appeal – Inclusion of orders for costs and interest – Whether such orders involved procedural unfairness in the circumstances. Words and phrases – "injury". Motor Accidents Act 1988 (NSW), ss 3(1), 69(1). GLEESON CJ, GUMMOW, HAYNE AND HEYDON JJ. In its primary aspect this is an appeal from orders of the Court of Appeal, Supreme Court of New South Wales1, allowing an appeal against orders made by the District Court of New South Wales (Delaney DCJ) relating to the application of the Motor Accidents Act 1988 (NSW) ("the Act") to one of two defendants to a claim by a plaintiff for damages for personal injury. Background facts The trial judge found that on 24 August 1999, the plaintiff, Salim Fahd Tleyji, suffered an injury in the following circumstances. He was an employee of Ready Workforce Pty Ltd, a labour hire company ("the employer"). That company supplied his services to GLG Australia Pty Ltd ("the occupier"). The occupier occupied and operated a warehouse at which the unloading of containers of goods took place. For some months the following system, devised by the occupier, had been in operation. A container to be unloaded would be placed in the yard of the warehouse. The plaintiff and others would place boxes from the container onto a pallet placed on a landing in front of the open container. A forklift truck would go up a ramp to the landing, pick up the pallet, and reverse down the ramp. As the forklift truck went up the ramp it caused vibration which was felt through the ramp, the landing and the container. On the day when the plaintiff was injured, the vibration generated by the forklift truck caused boxes stacked in the container to fall and strike the plaintiff as he stood about a metre inside the container. The trial judge found that both the employer and the occupier were liable, having breached their respective duties of care to the plaintiff. He apportioned the damages between the employer and the occupier in the proportion 25:75. The factual findings just summarised and the conclusions drawn from them are no longer controversial. The issues in controversy The controversy in this Court stems from the fact that the occupier's forklift truck was insured by CIC Insurance Ltd2. By the time of the trial that 1 GLG Australia Pty Ltd v Nominal Defendant (2004) 41 MVR 196. 2 The Act only required the forklift truck to be insured if it were to be driven on a public street (s 8), but, provided all other requirements were satisfied, the policy responded to events not taking place on a public street. insurer was in liquidation, and its liabilities under the policy were being dealt with by the Nominal Defendant. Pursuant to s 47A of the Act, the Nominal Defendant applied successfully to be joined as a party "in order to argue that in the circumstances of the case [the insurer had] no obligation under the policy" to indemnify the occupier. Pursuant to s 9 and Sched 1 of the Act, the policy insured "against liability in respect of … injury to a person caused by the fault of the owner or driver of the vehicle". The relevant part of the definition of injury in s 3(1) of the Act was: "[I]njury: (a) means personal or bodily injury caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle if, and only if, the injury is a result of and is caused during: the driving of the vehicle, or a collision, or action taken to avoid a collision, with the vehicle, or (iii) the vehicle's running out of control, or such use or operation by a defect in the vehicle, and The interest of the Nominal Defendant served by the application ran in tandem with an interest of the plaintiff. If the plaintiff's claim were for "an award of damages which relates to the death of or injury to a person caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle" (s 69(1)), Pt 6 of the Act would limit his damages to some degree. If the plaintiff's claim fell outside the quoted words, his damages would be higher. For the occupier, on the other hand, success for the Nominal Defendant and the plaintiff in their arguments would mean that it was without recourse against the Nominal Defendant and exposed to a higher level of damages to be paid to the plaintiff. Thus the issue whether the Nominal Defendant was obliged to indemnify the occupier, and the issue whether the plaintiff's claim against the occupier lay at common law unaffected by the restrictions in Pt 6 of the Act, turned on the identical question: did the plaintiff's injury fall within the definition of "injury" in s 3(1) of the Act? According to the Court of Appeal, the occupier urged on the trial judge a contention – and that it did so is no longer challenged in this Court – that par (a)(i) of the definition of "injury" applied: the accident was caused by the owner (ie the occupier) or driver of the forklift, because it was a result of and was caused during the driving of the vehicle. The trial judge held, however, that the plaintiff's injury "was not caused by the driving of the forklift in any negligent manner but the pursuit of the system of work which was implemented by [the occupier]". The consequence of this conclusion was that the damages payable by the employer amounted to $281,770.30, and those payable by the occupier were $347,015.30. The reason for the difference lay in the fact that parts of the damages payable by the employer were subject to restrictions under the Workers Compensation Act 1987 (NSW), while the damages payable by the occupier were not. A further consequence of this conclusion was that the occupier was not entitled to indemnity from the Nominal Defendant. The Court of Appeal allowed an appeal by the occupier3. The Court of Appeal started from the uncontroversial proposition that the plaintiff's injury was caused by the fault of the occupier, being the owner of the forklift truck. The Court of Appeal held, first, that the fault was a fault "in the use or operation of the vehicle" within the meaning of the opening words in par (a) of the definition of "injury". It said that "the way the vehicle was used was a necessary and important element in the fault of the owner of the vehicle. The system of work was held to be unsafe because it was such that the container, in which boxes were stacked, was caused to vibrate; and it was the forklift truck itself that caused the vibration."4 Secondly, the Court of Appeal held that the injury was caused during "the driving of the vehicle" within the meaning of par (a)(i) of the definition of "injury". It held that par (a)(i) could be satisfied even though the fault of the owner lay elsewhere, and for this it cited an earlier decision of the Court of 3 For the plaintiff the difference in recovery between his success on the question of the applicability of the Act in the District Court and his failure on it in the Court of Appeal was $51,409.77. Like the employer, the plaintiff is a party to the appeal in this Court, and has submitted to any order the Court may make, save as to costs. 4 GLG Australia Pty Ltd v Nominal Defendant (2004) 41 MVR 196 at 207 per Hodgson JA (Tobias JA and McColl JA concurring). Appeal, Allianz Australia Insurance Ltd v GSF Australia Pty Ltd5. The Court continued6: "Since it was the vibration of the container that caused the box to fall on the plaintiff, and since the vibration of the container was caused by the driving of the motor vehicle and occurred during the driving of the motor vehicle, there is no doubt that the requirements of subpara (i) are satisfied, unless it can be said that the causal relationship is not close enough, for some reason. The dissenting judgment of Santow JA in Allianz was essentially on the basis that the injury was not caused by the defect in the vehicle in that case, because the defect would have been quite harmless but for an extraordinary direction given by the plaintiff's employer, the owner of the vehicle, to manually carry out a task that should never have been carried out manually. The majority judges disagreed with this view in that case; but I note in any event that in the current case there is nothing of that nature that could be considered as making it inappropriate to treat the injury as truly caused by the driving of the forklift truck. Accordingly, in this case the injury was a result of and caused during the driving of the vehicle." Subsequent developments The relevant reasons for judgment of the Court of Appeal in this case were delivered on 1 June 2004. The Court of Appeal's reliance on the earlier Court of Appeal decision in Allianz Australia Insurance Ltd v GSF Australia Pty Ltd7 was said by the Nominal Defendant in this appeal to have placed its conclusions in question by reason of this Court having allowed an appeal against that decision on 19 May 20058. Indeed, parts of the Nominal Defendant's arguments were presented on the basis that while the Court of Appeal's position might have been defensible in light of how the definition of "injury" had been construed before the decision of this Court in the Allianz case, that reversal revealed the Court of Appeal's position to be untenable. (2003) 57 NSWLR 321. 6 GLG Australia Pty Ltd v Nominal Defendant (2004) 41 MVR 196 at 207 per Hodgson JA (Tobias JA and McColl JA concurring). (2003) 57 NSWLR 321. 8 Allianz Australia Insurance Ltd v GSF Australia Pty Ltd (2005) 79 ALJR 1079; 215 ALR 385. The decision of this Court in the Allianz case, while certainly relevant in this appeal, is not directly in point in two respects. The first is that the Allianz case turned on par (a)(iv) of the definition of "injury"; this appeal concerns par (a)(i). The second is that in the Allianz case the appellant conceded that there was "fault" on the part of "the owner … of a motor vehicle in the use or operation of the vehicle", to quote the opening words of par (a)9, while in this appeal that matter is contested. The arguments in this Court The second reading speech. The Nominal Defendant's arguments opened by pointing out that the current definition of "injury" in s 3(1) was introduced by the Motor Accidents Amendment Act 1995 (NSW) ("the 1995 Act"). The Nominal Defendant then relied on a statement in the joint judgment in this Court in Allianz Australia Insurance Ltd v GSF Australia Pty Ltd that the purpose of the 1995 Act was to limit the definition of injury by its cause and to narrow the overbroad reading given by the pre-1995 case law to the expression in s 69(1), "caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle"10. The Nominal Defendant then quoted a passage from the second reading speech of the Minister responsible for introducing the bill which became the 1995 Act in the Legislative Council, and which the joint judgment had also quoted11. The Nominal Defendant also relied on the explanatory note to the bill that became the 1995 Act. That note stated that the definition of "injury" had been changed "in order to remove an overlap that exists between motor accident claims and workers compensation claims"12. In contrast, the occupier submitted that while the 1995 Act was intended to narrow cover, it was not intended to obliterate it entirely. 9 Allianz Australia Insurance Ltd v GSF Australia Pty Ltd (2003) 57 NSWLR 321 at 335 per Davies A-JA; Allianz Australia Insurance Ltd v GSF Australia Pty Ltd (2005) 79 ALJR 1079 at 1083 [20] per McHugh J and 1094 [87] per Gummow, Hayne and Heydon JJ; 215 ALR 385 at 390 and 405. 10 (2005) 79 ALJR 1079 at 1093 [80]; 215 ALR 385 at 403. 11 Allianz Australia Insurance Ltd v GSF Australia Pty Ltd (2005) 79 ALJR 1079 at 1093 [81]; 215 ALR 385 at 403-404. 12 Motor Accidents Amendment Bill 1995 (NSW), explanatory note at 2. No fault in use or operation of vehicle. The Nominal Defendant conceded that driving the vehicle up the ramp was the "activity during which the injury [was] sustained"13, and hence that the injury was sustained during the "use or operation of the vehicle". However, the Nominal Defendant submitted that the words "caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle" meant "caused by a tortious use or operation of the vehicle", since "fault" was defined in s 3(1) as meaning "negligence or any other tort". But since there had been no fault in the relevant use of the vehicle, the actual driving, there was no fault in the sense set out in s 3(1), even though there had been fault in designing the system of work which employed the vehicle. Alternatively, even if "use or operation of [a] vehicle" did not mean "tortious use or operation", failure to provide a safe system of work was outside the meaning of the words "use or operation of [a] vehicle". One point at which the occupier challenged these submissions was the construction of "use or operation" as requiring a tortious use or operation. Another was to deny that there was an exhaustive dichotomy between injuries caused in the use or operation of a vehicle and those caused by employing it as part of an unsafe system of work. Counsel relied on the following rejection by Spigelman CJ in Zurich Australian Insurance Ltd v CSR Ltd of an argument that a particular injury caused when a plaintiff lifted a ramp which was part of a trailer was not caused "in the use or operation of" the trailer, but "was caused by an unsafe system of work or in the design of the trailer"14: "Nothing in the language used [in s 3(1)], or the scope, purpose or operation of the Act, suggests that a dual characterisation of 'fault' is impermissible. The definition applies so long as the fault may be characterised in the way set out within it. It matters not that some other characterisation may also be appropriate." Finally, the occupier submitted that the words in par (a) of the definition of "injury" before "if, and only if" were intended to bear a broad meaning, while the cutting down of the reach of the definition was to be found in the causative considerations appearing after the words "if, and only if". 13 Allianz Australia Insurance Ltd v GSF Australia Pty Ltd (2005) 79 ALJR 1079 at 1094 [89]; 215 ALR 385 at 405 (the words "such use or operation" in par (a)(iv) refer to the same "use or operation" as is referred to at the start of par (a)). 14 (2001) 52 NSWLR 193 at 201 (Mason P and Handley JA concurring). Causation. The Nominal Defendant submitted that the Court of Appeal erred in applying a common law test of causation. The statutory test, to be arrived at by examining the particular subject, scope and objects of the 1995 Act, was narrower. The statutory test required a connection which was close, direct, proximate and immediate. The vehicle did not strike the plaintiff, and it operated some distance away from where the plaintiff sustained injury. The chain of vibration from the forklift, through its wheels to the ramp, and thence to the landing, the container and the stacked boxes which fell onto the plaintiff, was too remote. The relevance of the second reading speech The Nominal Defendant's attempt, by close reference to the text of what the Attorney-General said in his second reading speech, to demonstrate that what happened was outside the definition of "injury" was of only limited success. That speech should not be employed beyond the function for which it was employed by this Court in Allianz Australia Insurance Ltd v GSF Australia Pty Ltd, namely, to demonstrate that a purpose of the Act was to narrow the law as laid down in pre-1995 cases15. It is not a permissible use of the speech, for example, to say that, because it referred to crashes and collisions on the roads, and vehicles running out of control, the post-1995 definition of "injury" was limited to injuries caused in these ways, without paying regard to its precise terms. The speech criticised cases holding that the Act applied to injuries sustained during the loading and unloading of vehicles. The present appeal concerned the unloading of a container, and a non-stationary vehicle played a part in the injury; but the speech casts no direct light on the solution to the present problem. The same is true of the explanatory note on which the Nominal Defendant relied. The words of the statute, not non-statutory words seeking to explain them, have paramount significance. Was there "fault of the owner or driver of a motor vehicle in the use or operation of the vehicle"? In Allianz Australia Insurance Ltd v GSF Australia Pty Ltd the joint judgment in this Court pointed out the importance of legislative history in construing the amendments to the definition of "injury" in 1995. It said16: 15 (2005) 79 ALJR 1079 at 1093 [80]-[81], 1096 [101] per Gummow, Hayne and Heydon JJ; 215 ALR 385 at 403-404, 408. 16 (2005) 79 ALJR 1079 at 1093 [84]; 215 ALR 385 at 404. "The third party policy first required by s 10 of the Motor Vehicles (Third Party Insurance) Act 1942 (NSW) … was to provide for insurance 'against all liability incurred by [the] owner … in respect of the death of or bodily injury to any person caused by or arising out of the use of the motor vehicle'. The phrase 'arising out of' was construed as extending to a result that was less immediate than the 'direct' or 'proximate' relationship of cause and effect indicated by the phrase 'caused by'." In 1988, the joint judgment continued, the "words 'arising out of' were banished from the legislation"17. The joint judgment then drew attention to the introduction, also in 1988, of s 69(1), which provides: "This Part applies to and in respect of an award of damages which relates to the death of or injury to a person caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle." In s 3(1) the word "injury" was defined as meaning "personal injury" and as including various matters now appearing in par (b) of the 1995 Act's definition. The joint judgment said: "It might have been thought that the new expression, 'in the use or operation', narrowed the scope of the legislation."18 However, it pointed to a decision just before the 1995 Act which was more consonant with the language of the 1942 Act than the Act in its 1988 form. It then said that "the outcome in that case is illustrative of the situations to which the legislature gave further attention in the 1995 Act"19. Later, after referring to the broad approach to causation in s 82 of the Trade Practices Act 1974 (Cth), the joint judgment said20: "[T]he subject, scope and purpose of the 1995 Act, and the changes it made to [the Act], point in the other direction. The text of the new definition of 'injury' manifests that legislative policy of restricting 17 (2005) 79 ALJR 1079 at 1094 [86]; 215 ALR 385 at 405. 18 (2005) 79 ALJR 1079 at 1094 [86]; 215 ALR 385 at 405. 19 (2005) 79 ALJR 1079 at 1094 [86]; 215 ALR 385 at 405. The case in question, NRMA Insurance Ltd v NSW Grain Corporation (1995) 22 MVR 317, is discussed below. 20 (2005) 79 ALJR 1079 at 1096 [101]; 215 ALR 385 at 408. previous overbroad interpretations of the CTP insurance legislation. A stated object of the changes made by the 1995 Act was (s 2A(1)(b)) the reinstatement of a common law based scheme but (s 2A(2)(a)) to keep premiums 'affordable' by containing 'the overall costs of the scheme within reasonable bounds'. A construction which promotes that object is to be preferred (s 2B(1))." In these ways the joint judgment stressed the narrowing effect of the new language employed to define "injury" in the 1995 Act. On the facts of this case, the relevant respect in which the vehicle was being operated was that it was being driven21. The findings of the trial judge negate any fault on the part of the driver. Those findings were accepted by the Court of Appeal. A challenge in this Court must be rejected for reasons given later. It is true that the occupier was at fault. The fault, however, lay not in the use or operation of the forklift truck, namely, the driving of it. The occupier itself was not driving, nor was the driver it employed driving in a negligent way. The occupier's fault lay in designing and implementing a system of work that involved driving the vehicle in the manner in which it was driven, rather than devising and providing a reasonably safe system of unloading the containers which would not cause vibrations likely to destabilise the boxes being unloaded. Contrary to the submission of the occupier, it is not correct to say that Spigelman CJ's approach to the characterisation of "fault" in s 3(1) in Zurich Australian Insurance Ltd v CSR Ltd22 was accepted as correct by this Court in Allianz Australia Insurance Ltd v GSF Australia Pty Ltd23. There was approval in the joint judgment for another aspect of the Chief Justice's reasoning24. It is 21 Allianz Australia Insurance Ltd v GSF Australia Pty Ltd (2005) 79 ALJR 1079 at 1094 [89]; 215 ALR 385 at 405. 22 (2001) 52 NSWLR 193 at 201 (Mason P and Handley JA concurring). 23 (2005) 79 ALJR 1079; 215 ALR 385. 24 The part of Zurich Australian Insurance Ltd v CSR Ltd (2001) 52 NSWLR 193 which was approved by Allianz Australia Insurance Ltd v GSF Australia Pty Ltd (2005) 79 ALJR 1079 at 1094 [88]-[89]; 215 ALR 385 at 405 was the discussion of the "second submission" at 201, whereas the material relied on by the occupier was that relating to the "first submission" at 200-201. not necessary to decide whether the passage relied on is correct, because even if it is, it does not destroy the Nominal Defendant's argument. The Nominal Defendant did not argue that, because the occupier was at fault in failing to devise a safe system of work, it could not be at fault in the use or operation, ie the driving, of the vehicle. The Nominal Defendant argued only that the occupier was at fault in the first way, but was not at fault in the second. The flaw in the occupier's contention that the words before "if, and only if" are to be broadly construed, while any qualification on the breadth of the definition of "injury" as a whole is to be found in the causative considerations appearing after "if, and only if", is that the contention gives no weight to the word "in" in the expression "in the use or operation of the vehicle". As counsel for the occupier accepted, "in the use" here means with respect to, as a consequence of, or by reason of the use of the forklift truck in the circumstances. That in turn points to the need to examine fault in the actual use or operation of the forklift truck at the particular time and place of the injury, and excludes an inquiry that goes more widely to instances of fault in the planning which led to its deployment and which may have taken place at points of time and place remote from those of the injury. The contention of the occupier that is under discussion was supported by recourse to a statement of Clarke JA that "use or operation" is not to be regarded in a narrow sense25; but the case in which it was made was seen in the joint judgment in this Court in Allianz Australia Insurance Ltd v GSF Australia Pty Ltd26 as an example of the authorities adopting an unduly wide construction of the legislation which it was the purpose of the 1995 Act to narrow. There is no reason to suppose that the narrowing effect of the 1995 Act was to be achieved only by the words after "if, and only if" to the exclusion of those before. The question is one of characterisation. The approach adopted by the joint judgment in Allianz Australia Insurance Ltd v GSF Australia Pty Ltd to the construction of the definition of "injury" introduced by the 1995 Act suggests that the facts of this case are to be characterised as revealing no fault on the part of the owner or driver of the forklift truck in its use or operation. On that ground the appeal must be allowed. 25 NRMA Insurance Ltd v NSW Grain Corporation (1995) 22 MVR 317 at 321 (with Priestley JA and Powell JA concurring). 26 (2005) 79 ALJR 1079 at 1094 [86]; 215 ALR 385 at 405. Was the injury caused by the fault of the owner? Although it is not necessary to deal with this question, it is convenient, in the light of the arguments of the parties, to do so. Assuming, contrary to what has been said, there was fault of the owner or driver of the vehicle in its use or operation, the question is whether the injury was "caused" by that fault, within the meaning of that word as used both at the beginning of par (a) and just before sub-par (i). In Allianz Australia Insurance Ltd v GSF Australia Pty Ltd, the joint judgment stated that the words "is caused" just before sub-par (i) were linked to a criterion that the injury be sustained as the consequence of the events listed in the sub-paragraphs27. Later, the joint judgment said28: "The use in the definition of the emphatic and intensive phrase 'if, and only if' directs attention to notions of predominance and immediacy rather than to more removed circumstances. The definition of 'injury' looks, for the CTP insurance system, to notions of proximate cause found in insurance law. That construction is consistent with the subject, scope and purpose of the 1995 Act." It is true that the Court of Appeal proceeded on a construction of the definition of "injury" from which this Court is differing. However, the conclusion of the Court of Appeal in this case that the causal connection was made out does not appear wrong. On the assumptions which must be made in order to pursue this causation inquiry, the forklift truck was not only the predominant cause, but in a sense the sole cause, of the plaintiff's injury. Its generation of vibrations was proximate and immediate in both time and space. The matter can be tested by examining the position which would have arisen if the occupier had devised a system of work using the forklift truck, but with a device which prevented vibration; and if one day its employee, the driver, had negligently removed that device, so that vibration took place and injured the plaintiff in the manner in which he actually was injured. In that event there would have been "fault of the … driver of a motor vehicle in the use or operation of the vehicle". And that fault could be said to have caused the injury during the driving of the vehicle. The removal of the anti-vibration device was a cause having a predominant, immediate and proximate character. That conclusion is not diluted or negated by the verbal device of describing what happened by 27 (2005) 79 ALJR 1079 at 1095 [94]; 215 ALR 385 at 406. 28 (2005) 79 ALJR 1079 at 1096 [102]; 215 ALR 385 at 408. interposing as many objects as possible between the forklift truck and the boxes which fell on the plaintiff as transmitters of the vibration. Notice of Contention The occupier submitted that the conclusion of the Court of Appeal should be upheld on a ground it rejected – that the injury was caused by the fault of the driver. The submissions were made briefly and in writing, but not orally. They seek to overcome the concurrent findings of the courts below that the driver of the forklift truck was not negligent. The occupier took this Court to no evidence about the driver, save for the unchallenged evidence of an expert that the shaking and swaying of the container, caused by vibration, which the plaintiff observed, should have been obvious to a qualified operator of a forklift with minimal experience. The occupier submitted that this established reasonable foreseeability. Even if that is assumed, the occupier called no witnesses about the system of work. There was no explanation for its failure to do this. There was thus no evidence, if one is to examine the matter from the driver's point of view, as to the magnitude of the risk, the degree of probability of its occurrence, the difficulties that faced the driver in taking alleviating action, or any other conflicting responsibilities he had. Nor did the occupier advance submissions on these topics to this Court. In particular, the occupier did not explain why it was unreasonable for the driver to continue to do what he had been told by the occupier to do, particularly where it had not led to injury in the previous months. The submission underlying the Notice of Contention should be rejected. Orders The appeal should be allowed with costs and the orders of the Court of Appeal set aside. This will have the effect of restoring the trial judge's orders, including his costs orders. The Nominal Defendant directed specific argument to one of the Court of Appeal's costs orders, Order 8, which was said to be wrong quite independently of what construction was given to the definition of "injury". The Court of Appeal ordered the Nominal Defendant to pay certain costs of the occupier in the District Court incurred since 31 May 2002 on the basis that the Nominal Defendant had failed to comply with s 45(1) of the Act, which creates a duty on an insurer to endeavour to resolve a claim as expeditiously as possible. Since s 45(1) would only apply to the Nominal Defendant if the insurer's policy responded to the claim against the occupier, the restoration of the trial judge's order that it did not means that Order 8 can no longer stand. All the same, the Nominal Defendant invited this Court to deal with the merits of the Court of Appeal's reasoning on the point on the ground that the Nominal Defendant wanted it decided because "it is an important point for the operation of the Act". This invitation must, with regret, be declined: to respond to it would be to offer no more than advice on a hypothetical question, and to deal with the point fully would involve the resolution of disputed factual questions. The Nominal Defendant's request for the order in par (a) of Order 3 was made only belatedly, and came to the attention of the occupier's advisers only the night before oral argument. The occupier, ie the first respondent, submitted that the issue raised should be remitted to the Court of Appeal, which would no doubt refer the matter to a single judge, an associate judge, or perhaps a registrar. The drawback to that approach is that it wastes costs and time. It seems preferable to make Order 3(a), but also to make the orders in the other paragraphs in Order 3. The following orders should be made: The appeal is allowed. The orders of the Court of Appeal, Supreme Court of New South Wales, ordered on 23 August 2004 are set aside and in lieu thereof order that the appeal to that Court is dismissed. It is ordered that the first respondent repay the sum of $132,370.34 to the appellant plus interest calculated at $32.64 per day from 12 November 2004 until the date when this order takes effect. The order in paragraph (a) is suspended for seven days. In the event of the first respondent filing and serving written submissions within that period contending that the order in paragraph (a) is wrong: it will remain suspended until further order; and is directed the appellant to file and serve written submissions in reply within a further seven days, and to apply within a further seven days to re-list the matter before a single Justice. The first respondent is to pay the appellant's costs of the appeal to the Court of Appeal and of the proceedings in this Court. Kirby KIRBY J. In Insurance Commission (WA) v Container Handlers Pty Ltd, I remarked that "each case of causation … depends on its own facts. Line-drawing is inescapable in the determination of issues of causation for legal purposes."29 I added that the duty of courts, where such disputes arise under statutory policies of insurance, is to "approach the statutory language from the standpoint of achieving its purpose"30. Decisions based on such statutory language, as applied to particular facts, represent no more than "individual instances". They do not provide binding precedents to be used in resolving cases that involve different facts31. I predicted that borderline cases would continue to present. So it has proved. In little more than a year, this Court has had to consider Allianz Australia Insurance Ltd v GSF Australia Pty Ltd32 and now the present case. The legislation in issue in this appeal, as in Allianz, is the Motor Accidents Act 1988 (NSW) ("the Act"). However, with new facts, the duty of the Court is to apply the legislation to the new circumstances according to its terms and so as to achieve its objects. It is not, as such, to apply judicial dicta, deployed in reasoning addressed to materially different evidence33. Still less is it a duty to give effect to ministerial speeches where the stated aspirations do not fully coincide with the statutory language34. To the extent of any difference, this Court's duty is only to the Act. These observations must be stated at the outset because the decision and reasoning of this Court in Allianz does not require, or suggest, reversal of the judgment of the Court of Appeal of New South Wales upon the primary issue argued in this appeal. Although the Court of Appeal's decision in Allianz35, subsequently overruled by this Court, was referred to in the reasoning of the Court of Appeal in this case36, written before our decision in Allianz was known, 29 (2004) 218 CLR 89 at 127 [116] (footnote omitted). 30 (2004) 218 CLR 89 at 128 [118]. 31 Joslyn v Berryman (2003) 214 CLR 552 at 584 [100], 602 [158]. 32 (2005) 79 ALJR 1079; 215 ALR 385. 33 The Court's insistence on the primacy of the duty to applicable legislation appears in many recent cases. See, eg, Weiss v The Queen (2005) 80 ALJR 444 at 452 [31]; 223 ALR 662 at 671. 34 See below these reasons at [80]-[84]. 35 (2003) 57 NSWLR 321. 36 GLG Australia Pty Ltd v Nominal Defendant (2004) 41 MVR 196 at 207 [55]. Kirby the significant factual distinctions between the two cases were emphasised. Correctly, Allianz was regarded as a distinguishable authority. The accurate application of the legislation to the accepted facts of this case requires an outcome different from Allianz. The Court of Appeal's conclusion was right. The appeal against that conclusion fails. So do subsidiary challenges37. It follows that the appeal should be dismissed. The facts Circumstances of the injury: Mr Salim Tleyji ("the plaintiff") was injured on 24 August 1999 whilst in the employ of Ready Workforce Pty Ltd ("the employer"). The employer was a labour hire company which had provided the plaintiff to perform work in a warehouse of the first respondent, GLG Australia Pty Ltd ("GLG"). The plaintiff worked in GLG's premises, under its control and as directed by employees of GLG. At the material time, the plaintiff was assisting in unloading a container of goods that had been deposited at the premises. Access to the container was gained by a ramp and landing that physically abutted the container. The plaintiff's work involved unloading boxes that were stored inside the container and placing them on a pallet positioned on the landing. A forklift truck, owned by GLG and driven by one of its employees, was required to ascend the ramp to the landing, collect loaded pallets and reverse down the ramp, depositing the pallets elsewhere in the premises. As the forklift truck approached the ramp to ascend to the landing, its tines (or forks) would strike the ramp, causing the ramp, the landing and the container to vibrate. At the moment of his injury, the plaintiff was standing approximately one metre inside the container facing the forklift truck as it ascended the ramp. The motion of the forklift truck caused vibrations, dislodging a number of boxes that fell. They struck the plaintiff and caused him personal injury. It was for such injury that the plaintiff sued his employer and GLG in the District Court of New South Wales, claiming damages. Registration and insurance: The forklift truck was a registered motor vehicle. It was insured in accordance with the Act. The insurance policy was issued by CIC Insurance Ltd ("CIC"). That policy obliged CIC to indemnify GLG, relevantly, "against liability in respect of … injury to a person caused by the fault of the owner or driver of the vehicle ... in the use or operation of the 37 The Nominal Defendant raised questions regarding costs and interest in its appeal. GLG, by notice of contention, raised an issue challenging concurrent findings concerning the fault of the driver. Kirby vehicle in any part of the Commonwealth (whether or not on a road or road related area)"38. The parties agreed that the fact that the plaintiff's injury occurred otherwise than on a road or road related area and that the "vehicle" was a forklift truck operating wholly within GLG's premises were circumstances that were immaterial to any right that GLG had to indemnity. GLG had insured its vehicle. It was entitled to indemnity in the circumstances, to the full extent that the Act provided. The Nominal Defendant: Between the date of the plaintiff's injury and the trial, CIC went into liquidation. Thereafter, as was also agreed, CIC's liabilities under the motor accident policy (if any) were to be borne by the Nominal Defendant referred to in the Act39. Although, at first, the Nominal Defendant rebuffed claims by GLG for indemnity under the statutory policy, eventually, on the eve of the trial, the Nominal Defendant applied to be, and was, joined as a party to the plaintiff's proceedings40. The purpose of this application was said to be to argue that, in the circumstances, there was no obligation under the policy to indemnify GLG. The dispute thus emerging between GLG and the Nominal Defendant was relevant to the amount of damages (if any) that could be recovered by the plaintiff. If, as the Nominal Defendant submitted, the liability of GLG fell outside the Act, the plaintiff was entitled to recover damages calculated in accordance with the common law. If the Act applied, the plaintiff's damages were limited to those recoverable under the Act. The difference was agreed to be approximately $51,000. The Nominal Defendant's arguments Before the primary judge (Delaney DCJ) the Nominal Defendant submitted that the case was to be decided in accordance with the definition of "injury" set out in s 3(1) of the Act. The Nominal Defendant contested that there was any fault of the owner or driver of a motor vehicle in the use or operation of the vehicle. It denied that the injury to the plaintiff was a result of, and was caused during, the driving of the vehicle. 38 The Act, s 9(a), Sched 1, cl 1. 39 The Act, s 26. The Act makes provision for "insolvent insurers" (s 120) and for payments to be made out of the Nominal Defendant's Fund (s 125). 40 Pursuant to the Act, s 47A. Kirby The Nominal Defendant submitted that there had been nothing unusual or negligent in the driving of the forklift truck and that it had been driven as intended and in a way no different from how it had been driven on countless prior occasions. Any relevant "fault" causing personal or bodily injury to the plaintiff was that of GLG as occupier of the premises where the plaintiff's injury occurred and as the primary organiser of the plaintiff's activities. The legislation As originally enacted in 1988, the Act contained a definition of "injury" in s 3(1) which was no more than descriptive of the kinds of harms or pathologies that attracted the operation of the Act. However, the Motor Accidents Amendment Act 1995 (NSW) amended the Act. In unusually imperative language, Parliament included amongst the objects of the Act (applicable at the time of the plaintiff's injury) a duty to acknowledge that41 "participants in the scheme under this Act have shared and integrated roles with the overall aim of benefiting all members of the motoring public by keeping the overall costs of the scheme within reasonable bounds so as to keep premiums affordable". Furthermore, Parliament provided specifically that the Act was to be interpreted and applied by reference to its objects42. This was the context in which the new definition of "injury", critical for this appeal, was inserted in s 3(1) of the Act43. The 1995 amendments omitted the previous definition of "injury" in s 3(1) of the Act and enacted a substitute definition. Paragraph (b) of the substitute definition included the substance of the previous definition of the harms and pathologies covered. However, par (a) added limitations that became the focus of the dispute between the Nominal Defendant and GLG in these proceedings. By virtue of the new definition of "injury", applicable at the time of the plaintiff's injury, the following relevant provision applied: 41 See the Act, s 2A(2)(a). 42 See the Act, s 2B(1). 43 Motor Accidents Amendment Act 1995 (NSW), s 3, Sched 1, cl 4. Kirby "[I]njury: (a) means personal or bodily injury caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle if, and only if, the injury is a result of and is caused during: the driving of the vehicle, or a collision, or action taken to avoid a collision, with the vehicle, or (iii) the vehicle's running out of control, or such use or operation by a defect in the vehicle …" Of the sub-paragraphs mentioned in the foregoing definition of "injury", only that contained in sub-par (i) was suggested to be relevant to GLG's entitlement to indemnity. The word "fault" is defined in s 3(1) of the Act to mean "negligence or any other tort". Part 6 of the Act governs the award of damages for injuries falling within the operation of the Act. By s 69(1) of the Act, appearing in that Part, it is provided that the Part "applies to and in respect of an award of damages which relates to … injury to a person caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle". Thus, s 69(1) of the Act is, as McHugh J described it in Allianz44, "the principal operative provision governing the award of damages under the Act" for which indemnity might be claimed under the statutory policy. It follows that, by that provision, "injury", as defined above, is made a "key term" of the Act. The use of that word in the definition of "motor accident"45, in the description of a "third-party policy"46 and in s 69(1), indicates how the term is mirrored throughout the legislation, incorporating the provisions with their multiple requirements necessary at once to a plaintiff's recovery of damages and to the entitlement of the motor vehicle owner and driver to indemnity for the liability to pay such damages. 44 (2005) 79 ALJR 1079 at 1081 [8]; 215 ALR 385 at 387-388. 45 The Act, s 3(1). 46 The Act, s 9. Kirby The decision of the primary judge Findings at trial: By the time this appeal reached this Court, the only contesting parties were the Nominal Defendant and GLG. The employer and the plaintiff took no part in the appeal. Contingently, the plaintiff was affected by its outcome47 but he left it to the Nominal Defendant to argue for the result most favourable to him. On this basis, it is unnecessary to record all of the findings made at trial. It is sufficient to note those relevant to the dispute between the Nominal Defendant and GLG. The primary judge made findings that GLG "set up the system of work ... to permit the unloading of the container", directed the plaintiff "as to the work he was to perform" and provided the forklift truck to "go up the landing, collect the pallet, and reverse down the ramp"48. He found that the tines of the forklift truck would "strike the bottom of the ramp causing noise and vibration" and that this "was not the fault of the driver but of the system of work"49. He accepted that the vehicle "was not being driven at an excessive speed"50. Instead, it "was being driven as it always was and this always caused vibration on the ramp and into the container"51. The primary judge generally accepted the evidence of the plaintiff52. In the course of considering the liability of the Nominal Defendant, he cited, with apparent acceptance, the following evidence of the plaintiff53: "Q: You said … that each time the forklift drove up the ramp, there was a bang as it hit the ramp? Yeah. There would be some vibration of the ramp and the container? 47 See above these reasons at [51]. 48 Tleyji v Ready Workforce Pty Ltd unreported, District Court of New South Wales, 17 April 2003 (Delaney DCJ) at [9] ("reasons of the primary judge"). 49 Reasons of the primary judge at [9]. 50 Reasons of the primary judge at [9]. 51 Reasons of the primary judge at [9]. 52 Reasons of the primary judge at [6]. 53 Reasons of the primary judge at [35]. Kirby Yeah. Sometimes the forklift … would go at speed and there would be a loud bang or a louder bang? Yeah. There would be a greater vibration? Yeah when it's coming up the ramp, and it did the vibration and when it hit at first." The judge recorded the plaintiff's evidence as to the differential vibrations occasioned by the speed of the driving of the vehicle. However, he said that "[f]rom this evidence I conclude that more likely than not the accident was not caused by the manner of driving of the forklift driver but by the way the work was organised"54. He went on55: "It was argued that the bang or boomp was a negligent driving of the forklift but I do not agree. The vibration occurred as the forklift ascended the ramp. In my opinion, there was nothing which the driver did or omitted to do which contributed to the vibration. I reached that conclusion because on the day of the accident the plaintiff saw the forklift coming up the ramp, the forklift hit the ramp and there was a bang, the forklift then came up the ramp as he was watching it … The plaintiff was then hit on the back when the forklift had just about reached him when the box or boxes fell. He felt the box hit him just as the forklift was reaching the top of the ramp but the forklift was still moving. In my opinion this was not caused by the driving of the forklift in any negligent manner but the pursuit of the system of work which was implemented by [GLG]." Defect in analysis: A defect in the foregoing analysis was identified by the Court of Appeal56. The primary judge approached the question that he had to answer on the basis of an apparent assumption that the liability of the Nominal Defendant depended on a choice between whether the plaintiff's injury was caused by fault in the driving of the forklift truck or in the system of work instituted by its owner. However, in presenting this choice57: 54 Reasons of the primary judge at [36]. 55 Reasons of the primary judge at [37]. 56 (2004) 41 MVR 196 at 204 [42]. 57 (2004) 41 MVR 196 at 204 [42] per Hodgson JA. Kirby "the primary judge did not consider whether the case could fall within the policy and the Act on the basis that the failure of GLG to provide a safe system of work was, in the circumstances, fault of the owner of the forklift truck in the use or operation of that truck, and that the injury was a result of and caused during the driving of the vehicle." Like the Court of Appeal, I consider that it is clear that "[t]he primary judge simply held that the injury was not caused by the driving of the motor vehicle in any negligent manner, and that the motor accident insurer was accordingly not liable"58. This defect of reasoning required the Court of Appeal to apply the Act to the facts as found or inferred and to complete the analysis which had failed at first instance. This the Court of Appeal proceeded to do. The decision of the Court of Appeal The first decision: The reasons of the Court of Appeal were given by Hodgson JA (Tobias and McColl JJA agreeing). Although accepting that, at trial, the plaintiff's allegations against GLG had rested on alternative contentions, namely that it was liable for the negligent driving of the forklift truck by its employee and that it was liable in the way in which the operation of the forklift truck had placed the plaintiff at high risk of injury59, Hodgson JA dismissed as "fanciful" the challenge to the primary judge's finding as to the individual fault of In this way, the case was confined in the Court of Appeal to the liability of GLG as the owner of the motor vehicle. The liability of the Nominal Defendant under the policy therefore depended upon whether the statutory policy responded to GLG's liability as owner for failing to institute a safe system of work, which ultimately represented "the whole basis of the primary judge's decision to award damages to the plaintiff"61. After describing and distinguishing past authority of the Court of Appeal, Hodgson JA came to the following conclusion62: 58 (2004) 41 MVR 196 at 204 [42] (emphasis added). 59 (2004) 41 MVR 196 at 201 [32]. 60 (2004) 41 MVR 196 at 199 [20]. 61 (2004) 41 MVR 196 at 206 [49]. 62 (2004) 41 MVR 196 at 207 [54]-[55]. Kirby "[T]he way the vehicle was used was a necessary and important element in the fault of the owner of the vehicle. The system of work was held to be unsafe because it was such that the container, in which boxes were stacked, was caused to vibrate; and it was the forklift truck itself that caused the vibration … Accordingly, there was in this case fault of the owner of the vehicle in the use or operation of the vehicle. ... Since it was the vibration of the container that caused the box to fall on the plaintiff, and since the vibration of the container was caused by the driving of the motor vehicle and occurred during the driving of the motor vehicle, there is no doubt that the requirements of subpara (i) [of par (a) of the definition of "injury" in s 3(1) of the Act] are satisfied, unless it can be said that the causal relationship is not close enough, for some reason. … [I]n the current case there is nothing … that could be considered as making it inappropriate to treat the injury as truly caused by the driving of the forklift truck. Accordingly, in this case the injury was a result of and caused during the driving of the vehicle." The second decision: In consequence of a declaration that the Court of Appeal made that GLG was entitled to indemnity from the Nominal Defendant, it was necessary to vary the plaintiff's verdict and to recalculate the apportionment between GLG and the employer. GLG and the Nominal Defendant eventually agreed upon the appropriate orders that would follow from the decision of the Court of Appeal save as to two matters. The first was whether, in the appeal, under the statutory policy of insurance, GLG was entitled to indemnity in respect of its costs and hence to an order of the Court of Appeal providing for such costs. The second question was whether GLG was entitled to an order against the Nominal Defendant for interest, at the court rate, on judgment moneys that had earlier been paid to the plaintiff by GLG itself, for want of indemnity. The Court of Appeal, in separately published reasons63, dealt with each of these questions. Having regard to past authority in this Court64, the Court of Appeal accepted that the liability of an insured to the insured's own lawyers, incurred in defending a claim for damages arising out of injury caused by the fault of the owner or driver in the use of a motor vehicle, was not within the words "liability in respect of" such injury in the policy and hence was outside the ordinary ambit of indemnity65. However, the Court of Appeal nevertheless 63 GLG Australia Pty Ltd v Nominal Defendant (No 2) (2004) 13 ANZ Insurance Cases ¶61-644. 64 Commercial and General Insurance Co Ltd v Government Insurance Office (NSW) (1973) 129 CLR 374. See also Owen v State of New South Wales (2004) 41 MVR 65 (2004) 13 ANZ Insurance Cases ¶61-644 at 77,872 [13]. Kirby concluded that, in making its orders, it was empowered otherwise to award costs based on its assessment of the responsibility of the parties for costs incurred by the other parties66. On this footing, it concluded that once the Nominal Defendant had denied liability, GLG had no alternative but to defend itself. Accordingly, costs incurred after the refusal of indemnity were to be "fairly regarded as being due to the Nominal Defendant's incorrect denial of indemnity"67. Similar reasoning was invoked to sustain an order for the payment of interest on the sum which GLG had been obliged to pay to the plaintiff because of the Nominal Defendant's refusal of indemnity68. In the result, the Court of Appeal ordered the Nominal Defendant to pay interest on the judgment moneys that had been paid by GLG to the plaintiff for want of indemnity. It ordered the Nominal Defendant to pay GLG's costs of the District Court proceedings incurred after the refusal of indemnity and to indemnify GLG in respect of the costs order in favour of the plaintiff in those proceedings69. In this Court, in addition to challenging the substantive determination, upholding GLG's entitlement to indemnity under the statutory policy, the Nominal Defendant contested the lawfulness of the Court of Appeal's orders in respect of the costs and interest. The issues Three issues therefore arise in this appeal. The negligence of the driver issue: Did the Court of Appeal err, as GLG asserts by notice of contention, in failing to find that the driver of the forklift truck was also guilty of negligence, requiring consideration of GLG's entitlement to indemnity under the statutory policy upon that basis? Should this Court reopen the concurrent findings of fact of the primary judge and the Court of Appeal in this respect? The indemnity issue: Upon the basis of established fault in the owner of the forklift truck, GLG, was it entitled to indemnity under the statutory policy for which the Nominal Defendant was liable? In the facts found and inferences available to it, did the Court of Appeal err in concluding 66 (2004) 13 ANZ Insurance Cases ¶61-644 at 77,873 [14]. 67 (2004) 13 ANZ Insurance Cases ¶61-644 at 77,874 [17]. 68 (2004) 13 ANZ Insurance Cases ¶61-644 at 77,874 [21]. 69 (2004) 13 ANZ Insurance Cases ¶61-644 at 77,874 [22]. Kirby that the statutory preconditions for indemnity were established? Was such a conclusion inconsistent with the holding or the reasoning expressed by this Court in Allianz? The costs and interest issue: Did the Court of Appeal err in disposing of the costs and interest claims of GLG in the manner that it did? The driver's fault should not be reopened Both the primary judge70 and the Court of Appeal71 found no individual negligence on the part of the driver in the way in which he drove GLG's forklift truck. They found that he drove the vehicle in a normal and regular way. Although his driving caused the tines of the vehicle to strike the ramp, occasioning vibrations, the responsibility for instituting a safe system of work to prevent the plaintiff from being injured as a result of such driving was that of GLG as owner of the vehicle. Although GLG was not the plaintiff's employer, there was no contest that it owed a duty to the plaintiff to institute a safe system in the work assigned to the plaintiff, specifically that which involved him working with the forklift truck72. The conclusions reached at trial and in the Court of Appeal on this point were clearly open. They rest upon concurrent findings of fact as to the conduct of the driver of the forklift truck. This Court will rarely disturb conclusions that depend upon such findings73. No sufficient reason has been shown why it should do so in this appeal. GLG's contention to the contrary should be rejected. Motor vehicle insurance: owner's indemnity Multiple requirements of the Act: In Allianz74, by reference to the provisions of the Act applicable also in the present case, McHugh J helpfully listed the several requirements of the definition of "injury" in s 3(1) of the Act that must be satisfied, relevantly, for indemnity to be available under the 70 Reasons of the primary judge at [37]. 71 (2004) 41 MVR 196 at 199 [20]. 72 Cf Hollis v Vabu Pty Ltd (2001) 207 CLR 21 at 47-50 [66]-[72]. 73 Woods v Multi-Sport Holdings Pty Ltd (2002) 208 CLR 460 at 495-496 [114]; Graham Barclay Oysters Pty Ltd v Ryan (2002) 211 CLR 540 at 568-569 [52]- [53]; Gattellaro v Westpac Banking Corporation (2004) 78 ALJR 394 at 406 [78]- [79]; 204 ALR 258 at 274-275. 74 (2005) 79 ALJR 1079 at 1083 [16]; 215 ALR 385 at 389. Kirby statutory policy. So far as applicable to the present case, those requirements are as follows: there must be 'fault of the owner … of the vehicle'. That is, the owner was negligent or had committed another tort (as 'fault' is defined in s 3); the fault of the owner must be 'in the use or operation' of the vehicle; the injury must be caused 'by' the fault of the owner or driver in the use or operation of the vehicle; the injury must be caused 'during' such use or operation of the vehicle; the injury must be a result of such use or operation". By reason of the findings of the primary judge, undisturbed on appeal, some of the foregoing requirements are not in dispute before this Court. Thus, it is accepted that there was "fault" in the defined sense, on the part of the owner of the vehicle, GLG, in implementing an unsafe system of work (requirement 1). Similarly, although the Nominal Defendant faintly argued to the contrary, it cannot really be disputed that the injury was caused "during" the use or operation of the vehicle, in the temporal sense (requirement 4). GLG's driver was actually manoeuvring the forklift truck, with the plaintiff watching him, when the injury happened to the plaintiff. This analysis confines the questions to be answered to the "use or operation" question (requirement 2) and the other aspects of causation set out in the remaining requirements that are applicable (requirements 3 and 5). As the Act commands75, and as Allianz explains76, the requirements that follow from the definition of "injury" are to be construed accepting that the Act is a statute providing particular and limited insurance coverage for motor vehicles. The purpose of the legislation introducing limitations upon the types of "injury" covered by the Act (and hence indemnified by the statutory policy) was that of "reducing the ambit of coverage, and hence the amount of premiums"77. This was a deliberate purpose. Courts must give effect to, and not frustrate, the 75 See the Act, s 2A. 76 (2005) 79 ALJR 1079 at 1082 [13], 1087-1089 [46]-[55], 1093 [80], 1100 [127]; 215 ALR 385 at 389, 396-398, 403, 413-414. 77 Container Handlers (2004) 218 CLR 89 at 127 [115]. Kirby achievement of that purpose, whatever views they may hold about the wisdom of its policy78. Clearly, the Act is not designed to afford a "universal compensation scheme for all injuries sustained in connection with a motor vehicle"79. By inserting multiple references to the requirement of causation in the critical provision it must be accepted that "an approach that limits the scope of the Act is preferable to one that would extend its application"80. This is especially so when the case is one involving, in some way, the loading and unloading of a vehicle which is stationary at the time of such operations81. Under a predecessor to the Act, this Court had held in Government Insurance Office of NSW v R J Green & Lloyd Pty Ltd82 that: "Any use that is not utterly foreign to its character as a motor vehicle is … covered by the words ['use of a motor vehicle'] … The loading of a vehicle designed to be used, and ordinarily used, for the carriage of goods is a necessary element in its ordinary use. Loading it is incidental to the use of it in the normal way." Cases on the loading and unloading of stationary vehicles83 and other activities involving such vehicles84 occasioned protests from some commentators that such claims constituted an unfair burden on motorists whose premiums for third party insurance supplied the pool of funds from which such claims were to be discharged. It was such protests that led to the 1995 amendments to the Act and the enactment of the Motor Accidents Compensation Act 1999 (NSW) ("the MACA") and like legislation, designed to cut back the entitlement to recovery (and consequently to indemnity) for motor accidents. 78 Cf Purvis v New South Wales (2003) 217 CLR 92 at 103-104 [18]-[20]. 79 Allianz (2005) 79 ALJR 1079 at 1089 [53]; 215 ALR 385 at 397. 80 Allianz (2005) 79 ALJR 1079 at 1089 [53]; 215 ALR 385 at 398. 81 Allianz (2005) 79 ALJR 1079 at 1088-1089 [52]; 215 ALR 385 at 397. 82 (1966) 114 CLR 437 at 446-447 per Windeyer J. 83 Such as NRMA Insurance Ltd v NSW Grain Corporation (1995) 22 MVR 317 and Allianz (2005) 79 ALJR 1079; 215 ALR 385. 84 Mercantile Mutual Insurance (Aust) Ltd v Moulding (1995) 22 MVR 325; cf Container Handlers (2004) 218 CLR 89 at 91 [1]. Kirby The ministerial speech: In deriving the meaning of "use or operation" of the vehicle in the context of the definition of "injury" in s 3(1) of the Act, and the ambit to be attributed to the other aspects of causation contained in the requirements of that definition, the Nominal Defendant placed much emphasis upon the speech of the Attorney-General, introducing the 1995 amendments. "It has become critical to unambiguously impart the underlying aims and objectives of the Motor Accidents Act to the judiciary, lawyers and insurers. It is therefore proposed to introduce objects clauses covering the Act as a whole … as well as certain key provisions in the legislation. In addition, new provisions will provide that the Act is to be construed having regard to these clauses. The CTP policy and the motor accidents scheme simply are not, and were never intended to be, a comprehensive accident compensation scheme providing substantial damages in all cases of injuries connected in some way to the use of a motor vehicle. Common sense and community expectations generally demand that the CTP policy provide coverage in respect of injuries which arise from crashes and collisions on the roads or from vehicles running out of control. Over the years the courts have interpreted the CTP policy as providing for a wide range of injuries often unrelated to motor accidents. For example, the CTP policy has been held to cover injuries sustained during the loading and unloading of vehicles, and injuries sustained while standing on the back of a stationary trailer, and injuries involved in the use of a firearm in a vehicle. ... [T]he expression 'motor vehicle' is widely defined in the Act and covers go-karts and other vehicles, such as forklifts, not normally associated with use on the dedicated public road network. Accidents involving such vehicles have given rise to claims against the Nominal Defendant under the Motor Accidents Act. … It is considered that claims for injury arising from the use of such vehicles should properly be made under such public liability policies and not against the Nominal Defendant." In Allianz, Callinan J quoted the foregoing passage86 in support of his conclusion that the policy, issued under the Act, did not respond to the 85 New South Wales, Legislative Council, Parliamentary Debates (Hansard), 16 November 1995 at 3322 (emphasis added). 86 (2005) 79 ALJR 1079 at 1100-1101 [128]; 215 ALR 385 at 414 referring also to the Interpretation Act 1987 (NSW), s 34 at 79 ALJR 1079 at 1102-1103 [136]; 215 ALR 385 at 416-417. Kirby circumstances of that case. Moreover, the passage cited appears to have influenced his Honour's view that it was "understandable that legislators become exasperated with courts that fail to give effect to the manifest intention of legislation, especially legislation enacted to arrest judicial trends that have become entrenched over the years."87 These added remarks were not reflected in the reasons of the other members of this Court in Allianz. With respect, I do not regard them as part of the binding rule of that decision. Nor do I regard the Attorney-General's speech as affording more than an illustration of the political context in which the 1995 amendments to the Act were enacted. This Court has repeatedly insisted that the Second Reading and other speeches in Parliament may only be used to throw light on the meaning of legislative words, to the extent that such speeches are sustained by the legislative text as subsequently adopted88. It is in the nature of parliamentary speeches that they commonly lack the precision of statutory language. They can sometimes be motivated by forensic and political factors. They occasionally stray into hyperbole. The rule of law requires that this Court give effect to the purpose of Parliament expressed in the law made by or under an enactment89. It is not part of a court's function, as such, to give effect to parliamentary speeches, ministerial media releases or other informal statements unless, validly, they have the specific endorsement of a parliamentary enactment. Saying this is not to discourage the proper use of such materials. It is simply to insist on the primacy of the enacted law. Avoiding the unenacted: When the Minister's words are scrutinised, there are important disparities between his stated purposes and the Bill in support of which he was speaking. Thus, whatever commonsense and community expectations may say in respect of the coverage of injuries "which arise from crashes and collisions on the roads", the definition of "injury" in the Act makes no reference to "crashes". Nor does it confine recovery to "crashes and collisions on the roads". Nor does it limit recovery to injuries "associated with use on the 87 (2005) 79 ALJR 1079 at 1096 [106]; 215 ALR 385 at 408. 88 Re Bolton; Ex parte Beane (1987) 162 CLR 514 at 518; Byrne v Australian Airlines Ltd (1995) 185 CLR 410 at 459; Wik Peoples v Queensland (1996) 187 CLR 1 at 169; Leask v The Commonwealth (1996) 187 CLR 579 at 634; Byrnes v The Queen (1999) 199 CLR 1 at 34 [80]; Mann v Carnell (1999) 201 CLR 1 at 45 [143]; Re Minister for Immigration and Multicultural Affairs; Ex parte Miah (2001) 206 CLR 57 at 95 [132]; The Commonwealth v Yarmirr (2001) 208 CLR 1 at 117 [261]; Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476 at 499 89 Byrne v Australian Airlines Ltd (1995) 185 CLR 410 at 459. Kirby dedicated public road network". Nor does it exclude liability for vehicles "such as forklifts". Nor does the definition of "injury" exclude liability where there is some other "public liability" insurance, compulsory or otherwise. Nor does the definition contain a power or discretion in a court to assign liability to any relevant "public liability policies and not against the Nominal Defendant". If it had been the purpose of the New South Wales Parliament to introduce exclusions, qualifications, powers and discretions in terms of the language used by the Attorney-General in his speech, it was open to it to do so. However, the law as enacted is significantly different. It is that law which this Court must apply. If we do not, we undermine the parliamentary process, damage that institution, and shift power still further from Parliament to the executive and specifically officials who write Second Reading and like speeches, draft explanatory memoranda and prepare media releases. I would not do that. It follows from this analysis that this Court should, in the orthodox way, whilst noting the Attorney-General's explanation of the general purposes of the 1995 amendments, turn to the words as enacted. The Court must give them meaning consistent with the legislative purpose as revealed by the enacted words, taking into account only such background material as is consistent with those words. When this approach is adopted, it is worth repeating a remark of McHugh J in Allianz90, also applicable to this case: "The difficulty of the case arises from the failure of the Act to state expressly or inferentially that that Act does not apply if the Workers Compensation Act or, indeed, any other statutory public liability scheme, applies to the facts of the case." The course mentioned by McHugh J could have been taken. But it was not. It would be quite wrong for this Court to repair that legislative omission. Particularly is this so because the Court is on notice that still further amendments to the Act were adopted by the MACA in 1999 and these too omitted to adopt an automatic or even discretionary exclusion of entitlements (and indemnity) under the Act, along the lines mentioned by the Minister. The fact that such straightforward solutions were available, but not adopted, highlights the duty of this Court to adhere to the statutory language91. 90 (2005) 79 ALJR 1079 at 1081 [8]; 215 ALR 385 at 387. 91 Ferdinands v Commissioner for Public Employment [2006] HCA 5 at [73], [91]- Kirby It should be kept in mind that a decision as to the ambit of the definition of "injury" under the Act does not govern only cases where dual insurance exists or where some other defendant might be liable to the injured person. A decision in the present case will apply to other circumstances, including cases where an injured person would be left without recourse to insurance funds if the circumstances of his or her injury did not fall within the Act92. This consideration is not a reason for adopting a construction of the amended definition of "injury" in the Act in order to provide a deep pocketed defendant for injured plaintiffs, a notion to which Callinan J took exception in Allianz93. It is simply a reminder that the interpretation adopted has consequences for different cases that could result in a narrowing of the application of legislation whose overall purpose is beneficial and protective, although within the limits as expressed. Use or operation of the vehicle: The primary thrust of the Nominal Defendant's arguments in this Court was that GLG's claim for indemnity failed at the threshold within the opening words of the definition of "injury" in s 3(1) of the Act. This was because, even if (on one view) the plaintiff's personal or bodily injury was caused by the "fault" of the owner of a motor vehicle, being the forklift truck, such "fault" lay only in the system of work which that owner had instituted. It did not exist "in the use or operation of the vehicle". This argument must be rejected. Here, the "fault", as found, lay in the defective system of work that the owner of the vehicle had implemented. But that system of work did not exist in a vacuum. Necessarily, it had a factual content. It involved the failure of the owner, GLG, to consider, design and implement a system addressed to the particular problem presented by the tines of the forklift truck striking the ramp repeatedly, causing vibrations through the abutting metal of the platform and into the container and its contents. As earlier cases have shown, in this Court and elsewhere, the word "use" has a wide meaning in this context. In Dickinson v Motor Vehicle Insurance Trust, this Court said that word in the Motor Vehicle (Third Party Insurance) Act 1943 (WA) extended "to everything that fairly falls within the conception of the use of a motor vehicle and may include a use which does not involve locomotion"94. The word has appeared in legislation of the present kind for over 92 Container Handlers (2004) 218 CLR 89 at 123-124 [102]. 93 (2005) 79 ALJR 1079 at 1103 [136]; 215 ALR 385 at 417 referring to Allianz (2003) 57 NSWLR 321 at 323 [4] per Mason P. 94 (1987) 163 CLR 500 at 505. See also Allianz (2005) 79 ALJR 1079 at 1084 [28]; 215 ALR 385 at 391. Kirby fifty years. Even if "use" were restricted to the driving or the manner of control of the motor vehicle (an interpretation narrower than that previously adopted) it would apply to the present case. Similarly, the "operation of the vehicle" was immediately relevant and causative, in the sense of affecting the working or running of the vehicle as such. There was nothing stationary about the forklift truck in the present facts. An essential part of the complaint about the owner's system of work related to the locomotion of the vehicle as its parts struck the ramp. The fault of the owner, relevant to the cause of the plaintiff's injury, was in instituting and persisting with the use or operation of the forklift truck without precautions to prevent adverse and foreseeable consequences of the impact of the tines of the vehicle on the ramp. A safe system of work in this case might have involved stabilising the ramp leading to the container so that the forklift truck could use or operate on the ramp, even striking it, without the risk of vibration. It might have involved disjoining the ramp and landing from the container so that the use and operation of the forklift truck would not transmit vibrations into the container. Or it might have involved using some other means of unloading the container in the circumstances of the danger presented by the use or operation of the forklift truck95. All of these ingredients in the defect of the owner's system of work involved the use or operation of the insured vehicle. The Nominal Defendant's first argument envisaged a complaint about the system of work disjoined from the use or operation of the vehicle. However, that was not the way the case was presented at trial. Nor was it a sensible or practical hypothesis. The use and operation of the forklift without repeated impact, causing vibrations within the connected container, would have been safe and without "fault". The "fault" in the system of work employed was "fault of the owner … in the use or operation of the vehicle" as that vehicle was used and operated in fact. The first argument of the Nominal Defendant therefore fails. Result and cause: This leaves the Nominal Defendant's second argument. The remaining words of the definition of "injury" in s 3(1) of the Act are couched in restrictive terms. Satisfaction of the opening provisions of the definition will not suffice to establish an entitlement (relevantly to indemnity under the statutory policy) unless the latter part of the definition is also found to apply. In this sense, the entirety of the definition must be read as a whole. It should not be split artificially into constituent parts96. 95 (2004) 41 MVR 196 at 206-207 [53]. 96 R v Brown [1996] AC 543 at 561 applied in Collector of Customs v Agfa-Gevaert Ltd (1996) 186 CLR 389 at 397. Kirby Although the sub-paragraphs in par (a) of the definition of "injury" deal with particular varieties of "the use or operation of the vehicle", and although they are stated disjunctively, their purpose is clearly restrictive and cumulative. In effect, Parliament has said that, even if the injury was caused by the fault of the owner in the use or operation of the vehicle, that is not sufficient to give rise, relevantly, to indemnity under a statutory policy. It remains for the claimant, seeking indemnity, to bring the case within one of the particular aspects of the use or operation of the vehicle. The first three sub-categories plainly contemplate the movement of the vehicle. They require both a causal and temporal connection between such movement and the injury that is posited in terms by the opening words of the definition. In the undisputed facts of the present case, the plaintiff's injury was certainly "caused during ... the driving of the vehicle". But this is also insufficient. There is a conjunctive requirement that the injury must also be "a result of" the driving of the vehicle. In the present case, there is no doubt that the injury was the result of the driving of the forklift truck in one sense because it was the impact of the tines on the ramp, during the very driving of the forklift truck, that directly caused the vibrations that dislodged the boxes that fell on the plaintiff, injuring him. The ultimate question thus emerging, as Hodgson JA recognised97, was whether there was anything in the facts of the present case that would make it inappropriate to treat the injury as truly "a result of" and "caused during" the driving of the vehicle. The Nominal Defendant presented two arguments on this question. The first involved the incantation of the mantra that the plaintiff's injury was "a result of" and was "caused during" the unsafe system of work which constituted the true "fault of the owner". As such, it had nothing to do with the "driving of the vehicle". I have already demonstrated why this overly simplistic, even ethereal, view of the evidence must be rejected. A system of work, safe or defective, does not exist disembodied from a wider appreciation of the facts. The present system of work involved the use or operation of a forklift truck which led directly and immediately to the dislodgment of boxes that injured the plaintiff. A safe system of work might still have involved the use or operation of such a vehicle but without the danger of the impact that the defective system of work involved. A similar proposition, suggesting that reliance on an unsafe system of work as the "fault" of a vehicle owner necessarily excludes causation "in the use or operation of" the vehicle, was rejected by the New South Wales Court of 97 (2004) 41 MVR 196 at 207 [55]. See above these reasons at [67]. Kirby Appeal in Zurich Australian Insurance Ltd v CSR Ltd98. There, Spigelman CJ99 said, correctly in my view100: "The … submission was, essentially, one of characterisation. The appellant submitted that the injury was not caused 'in the use and operation of' the [vehicle]. The injury was caused by an unsafe system of work or in the design of the [vehicle]. Nothing in the language used, or the scope, purpose or operation of the Act, suggests that a dual characterisation of 'fault' is impermissible. The definition applies so long as the fault may be characterised in the way set out within it. It matters not that some other characterisation may also be appropriate." Like conclusions have been reached in other decisions of the Court of Appeal. Those decisions were affirmed in Zurich101. I consider that they too are rightly decided. The object and purpose of the narrowing of the definition of "injury" in s 3(1) of the Act was substantially to cut back claims under the Act (including to indemnity) in respect of stationary vehicles, most (but not all) instances of unloading and events having no real connection with the vehicle as a vehicle. The present was not such a case. The use and operation of the vehicle was directly connected with the cause and occasion of the injury to the plaintiff. Applying the language of the Act, the statutory policy had therefore to respond to a claim by the owner based on its fault, being the defective system of work that included the repeated use or operation of the vehicle, as such, in the manner described. The Nominal Defendant's second argument was addressed to what was said to be the indirect character of the connection between the "use or operation of the vehicle", the "driving of the vehicle" and the plaintiff's injury. Thus, it was submitted that, properly analysed, the vehicle was only remotely connected with the cause of the injury so that the causation contemplated by the definition of "injury" in s 3(1) of the Act was not established. Nor, on this argument, would the injury be classified as "a result of" the driving of the vehicle. The Nominal Defendant pointed out that the impact of the tines of the vehicle happened to the ramp, not the plaintiff. This set in train an impact on the platform which, in turn, 98 (2001) 52 NSWLR 193. 99 With the concurrence of Mason P and Handley JA at 212 [102]-[103]. 100 (2001) 52 NSWLR 193 at 201 [29]. 101 (2001) 52 NSWLR 193 at 201 [30] affirming in this respect NRMA Insurance (1995) 22 MVR 317 esp at 319; Balfour Beatty Power Constructions (Australia) Pty Ltd v Government Insurance Office of New South Wales (1996) 24 MVR 162 at 163-164; AMP General Insurance v Brett (1998) 27 MVR 492 at 495. Kirby caused vibration of the container. This had the consequence of the dislodgment of the boxes. Only as a result of such dislodgment and the falling of the boxes was the plaintiff injured. The Nominal Defendant suggested that the causal chain was too indirect or remote. This argument should also be rejected. As a matter of fact, consistent with the evidence found by the primary judge, the impact of the tines on the ramp was the direct and immediate cause of the vibrations that resulted in the plaintiff's injury. The outcome of the impact was virtually instantaneous, once a condition of instability of the boxes in the container was reached. Factually, therefore, there is no indirectness. In any case, there is nothing in the terms of the definition of "injury" in the Act that required the cause and result there mentioned to be "immediate" or "proximate". Thus, the Act does not contain a qualifying adjective or adverb such as "direct" or "directly", as included in the Western Australian legislation102. This Court is not warranted to add such a word to language which is already detailed, particular and strict. In Allianz103, McHugh J cautioned, correctly in my view, against the introduction of "metaphysical concepts such as 'proximate cause' or 'immediate cause'". He said that such expressions "should be avoided, because they provide little, if any, assistance in resolving questions of causation under this Act." Several cases show that particular statutory frameworks may require a finding that no causal connection exists for legal purposes although, in another legal context, a sufficient physical connection might sustain recovery by reference to the policy judgments implicit in the law104. It depends, in each case, upon the purpose of the statute, as derived from its language. Here, the purpose was clearly to restrict claims for motor accidents and hence for indemnity under the statutory policy. There is no contest about this. But the extent of the restriction is not to be found in generalities such as those that assert that this is not "truly" a "motor vehicle case" or is "more properly" a case to which some other policy of insurance responds. Such self-answering statements offer no real explanation as to why any particular case should, or should not, fall within the ambit of the Act. Accepting that minds can differ in 102 See Container Handlers (2004) 218 CLR 89 at 102 [27], 118 [80], 124 [105], 129 103 (2005) 79 ALJR 1079 at 1089 [54]; 215 ALR 385 at 398. 104 (2005) 79 ALJR 1079 at 1089 [55]; 215 ALR 385 at 398. Kirby the characterisation of facts and the drawing of boundaries, cases such as the present are not to be solved by over-simplifications or generalisations. When the Act is applied to the facts as found in the present case, the Court of Appeal was correct to uphold the claim by GLG on the policy issued under the Act. No error has been shown in the reasoning of the Court of Appeal. Subject to what follows the judgment of the Court of Appeal should, to this extent, be affirmed. Consistency with Allianz: Yet is this conclusion inconsistent with the approach adopted by this Court in Allianz? The Nominal Defendant submitted that it was. In my view, this submission should be rejected. Allianz was a claim involving the unloading of containers from the back of a truck. In that case, the truck's own unloading mechanism had become inoperative. The employee was directed to unload the containers manually. The respondent conceded negligence in its system of work. This Court held that the plaintiff's "injury" was not "a result of" the use or operation of the vehicle105 (as required by the Act). As appears from this description, Allianz was a case concerned with a motor vehicle in a completely static condition. The vehicle was stationary. The injury was not "a result of" or "caused during" the driving of the vehicle. The claim pressed in that case relied on the residual instance in par (a)(iv) of the definition of "injury", referring to "such use or operation by a defect in the vehicle". The facts of Allianz are therefore quite different from the present facts. The very complaint that is made here concerns the use or operation of the motor vehicle as a moving object. The Court of Appeal was therefore right to distinguish Allianz and to treat the present case as governed by different considerations and different provisions in the statutory definition of "injury"106. This is not to say that an injury occasioned as a result of the use or operation of a stationary vehicle could never fall within the Act. The relevant point is that this was a basis for distinguishing Allianz. Is there anything in the reasoning in Allianz that suggests an approach different from that which is required by the language of the Act, explained above? I think not. In the reasons of McHugh J in Allianz107, his Honour drew to 105 See Allianz (2005) 79 ALJR 1079; 215 ALR 385. 106 (2004) 41 MVR 196 at 207 [55]. 107 (2005) 79 ALJR 1079 at 1091 [64]; 215 ALR 385 at 400. Kirby attention the distinction between the facts of that case and the earlier decision of the Court of Appeal in Zurich, mentioned above108. He said: "In both Zurich and the present case, the worker was instructed to do something which led to the worker being injured. In Zurich, however, the instruction was to use the vehicle for the purpose and in the manner for which it was intended. In the present case, [the worker] was instructed to use the vehicle in a manner other than its intended use." If this principle is applied here, the driver was clearly using the forklift truck as a motor vehicle for the purpose, and in the manner, for which it was intended. The facts are therefore not analogous to those in Allianz. It follows that upon no proper analysis does the legal rule established in Allianz determine the outcome of this appeal. The joint reasons in Allianz also laid emphasis on the "vehicle … functioning in the ordinary way"109. Those reasons stress the legislative policy of restricting previous interpretations of motor vehicle insurance legislation110. So much may be accepted. However, there is nothing in the joint reasons in Allianz that suggests that the Court is to do anything but apply the Act, restricted as it may be, in accordance with its terms to the facts and circumstances of each case. Whilst the joint reasons in Allianz make reference to the Second Reading Speech of the Attorney-General111, they do this solely for the purpose of deriving the conclusion that the 1995 amendments were intended "to limit the definition of injury by its cause and to narrow what the legislature considered the overbroad reading in the case law"112. In this appeal, that purpose is undisputed. The Nominal Defendant placed particular emphasis upon the statement in the joint reasons in Allianz113 to the effect that "notions of predominance and immediacy", as distinct from "more removed circumstances", must be established between, relevantly, the driving of the vehicle and the injuries. Although I reject this criterion114, the present case qualifies. The actions of the forklift truck 108 These reasons at [98]. 109 (2005) 79 ALJR 1079 at 1095 [95]; 215 ALR 385 at 406. 110 (2005) 79 ALJR 1079 at 1096 [101]; 215 ALR 385 at 408. 111 (2005) 79 ALJR 1079 at 1093 [81]; 215 ALR 385 at 403-404. 112 (2005) 79 ALJR 1079 at 1093 [80]; 215 ALR 385 at 403. 113 (2005) 79 ALJR 1079 at 1096 [102]; 215 ALR 385 at 408. 114 See above these reasons at [102]-[103]. Kirby constituted a predominant and immediate factor in the happening of the plaintiff's injury. This is demonstrated by the instantaneous link between the driving, the resulting impact on the ramp, and the fall of the boxes that immediately followed, injuring the plaintiff. Conclusion: Allianz is inapplicable: With these considerations in mind, this Court in Allianz concluded that the statutory policy was inapplicable. But the present case involved entirely different facts. The policy responds to them. It follows that nothing in Allianz, either in its holding or in its approach, requires an outcome in the present appeal favourable to the Nominal Defendant. The arguments to the contrary should all be rejected. An outcome favourable to GLG in the present case would mean a diminution in the plaintiff's recovery. However, in another case, the result could be the difference between recovery from the motor vehicle insurer and no recovery at all. The orders as to costs and interest Procedures in the Court of Appeal: There remains only the separate challenge by the Nominal Defendant to the orders made by the Court of Appeal in its second decision concerning the supplementary orders made in relation to costs and interest115. I must decide that challenge having regard to the rejection of the Nominal Defendant's arguments on the principal issue in the appeal. That was the foundation on which the Court of Appeal made the additional orders now impugned. Obviously, the Court of Appeal was obliged to determine the Nominal Defendant's appeal by formulating orders and entering judgment on the entirety of the matters in contest between the parties. By the orders formulated in the first decision, the parties were directed to bring in agreed short minutes of order within seven days. In default of agreement as to the final orders, directions were given for the filing of supplementary submissions116. Written submissions were duly made to the Court of Appeal. They were placed before this Court. After the submissions were received, Hodgson JA afforded the parties the opportunity to make still further submissions on whether a cross-claim should be permitted by GLG against the Nominal Defendant for the recovery of money in accordance with the District Court Act 1973 (NSW), s 83A. The Nominal Defendant objected to that course. GLG pressed the Court of Appeal to adopt it. 115 See above these reasons at [68]-[71]. 116 (2004) 41 MVR 196 at 208 [58]. Kirby GLG submitted that the Court of Appeal had the power to grant leave to file a cross-claim pursuant to that Court's powers under the Supreme Court Act 1970 (NSW), s 75A(5) and (6). GLG also submitted the Nominal Defendant suffered no prejudice by leave being granted to file such a cross-claim since it would only formalise the real dispute between the parties, as it had emerged in the trial and on appeal. I am unconvinced that, in the substance of the matters litigated and in the procedures adopted by the Court of Appeal, any procedural unfairness or legal error arose in the course that the Court of Appeal adopted. Orders made within power: Similarly, the conclusions arrived at by the Court of Appeal as to costs and as to interest were open to it. They arose within that Court's large statutory powers both to award costs, having regard to the responsibility of the parties for such costs, and to provide for an order for interest, as s 83A of the District Court Act permitted. In each case, the obligations of the Nominal Defendant to pay costs and interest rest not, as such, on duties inherited from CIC as the statutory insurer of GLG under the Act but because the Nominal Defendant became a litigant successively before the District Court and the Court of Appeal. It was liable, as such, to orders made by the Court of Appeal within its powers, in disposing of an appeal, to deal with ancillary questions such as interest and costs. In the case of this Court, analogous questions have arisen in respect of the power to make orders in relation to costs. Such questions have been decided in ways similar to the approach taken by the Court of Appeal here117. Although the respective powers are not identical, the point of principle is the same. No error has been shown in respect of the orders for costs or interest. So far as the merits of those orders were concerned, they were fully justified by the reasons given by Hodgson JA in the Court of Appeal. Orders The appeal should be dismissed with costs. 117 Cf Re McJannet; Ex parte Australian Workers' Union of Employees (Q) [No 2] (1997) 189 CLR 654 at 656-657; De L v Director-General, NSW Department of Community Services [No 2] (1997) 190 CLR 207 at 220-222; Construction, Forestry, Mining and Energy Union v Australian Industrial Relations Commission (2001) 203 CLR 645 at 660 [41]-[44]; Re Maritime Union of Australia; Ex parte CSL Pacific Shipping Inc (2003) 214 CLR 397 at 421 [63]. Kirby

HIGH COURT OF AUSTRALIA CONSTRUCTION FORESTRY MINING & ENERGY UNION APPELLANT AND MAMMOET AUSTRALIA PTY LTD RESPONDENT Construction Forestry Mining & Energy Union v Mammoet Australia Pty Ltd [2013] HCA 36 14 August 2013 ORDER Appeal allowed. Set aside the orders of the Federal Court of Australia made on 14 August 2012 and, in their place, order that: the appeal from the Federal Magistrates Court of Australia to the Federal Court be allowed; the order of the Federal Magistrates Court made on 20 October 2011 be set aside; and the application be remitted to the Federal Circuit Court of Australia to be heard and determined according to law. On appeal from the Federal Court of Australia Representation J K Kirk SC with T J Dixon for the appellant (instructed by Construction Forestry Mining & Energy Union) S J Wood SC with C O H Parkinson for the respondent (instructed by Lander & Rogers Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Construction Forestry Mining & Energy Union v Mammoet Australia Pty Ltd Industrial law (Cth) – Payments relating to periods of industrial action – Where employer provided employees with accommodation under enterprise agreement – Where employees took "protected industrial action" within meaning of s 408 of Fair Work Act 2009 (Cth) ("Act") – Where employer ceased to provide accommodation to employees for duration of "protected industrial action" – Whether provision of accommodation a "payment to an employee in relation to the total duration of the industrial action" under s 470(1) of Act. Industrial law (Cth) – Enterprise agreement – Whether employees entitled to accommodation under terms of enterprise agreement when not ready, willing and available to work. Words and phrases – "adverse action", "enterprise agreement", "in relation to", "payment", "protected industrial action", "ready, willing and available to work". Fair Work Act 2009 (Cth), ss 323, 332, 340, 342, 408, 470. CRENNAN, KIEFEL, BELL, GAGELER AND KEANE JJ. The appellant, an organisation of employees registered under the Fair Work (Registered Organisations) Act 2009 (Cth), represents the industrial interests of a number of employees of the respondent who worked on construction at the Woodside Pluto Liquefied Natural Gas Project ("the Project") located on the Burrup Peninsula in the remote north-west of Western Australia. The Project principal was Woodside Burrup Pty Ltd ("Woodside"). The employees worked pursuant to "fly in/fly out" arrangements, under which the respondent provided their accommodation while on location. The respondent was notified of the intention of some of its employees, including the four employees who are the subject of these proceedings ("the relevant employees"), to engage in industrial action as part of the process of negotiating an enterprise agreement with the respondent under the Fair Work Act 2009 (Cth) ("the Act"). It is common ground that this action was "protected industrial action" within the meaning of s 408 of the Act. It is also common ground that the respondent did not seek to terminate the employment of the relevant employees as a result of their action. The respondent notified the relevant employees that it intended to cease providing accommodation to them, contending it was obliged to do so during the period of industrial action by s 470(1) of the Act, which provides: "If an employee engaged, or engages, in protected industrial action against an employer on a day, the employer must not make a payment to an employee in relation to the total duration of the industrial action on that day." The respondent's contention was accepted in the Federal Magistrates Court of Australia and on appeal in the Federal Court of Australia. For the reasons which follow, the appeal to this Court should be allowed. Background The employment of the relevant employees was regulated by an enterprise agreement entitled the Mammoet Australia Pty Ltd Pluto Project Greenfields Agreement 2008 ("the Agreement"). The Agreement was an employer greenfields agreement made under s 330 of the Workplace Relations Act 1996 (Cth) ("the WR Act"). The operation of the Agreement was continued as a collective agreement-based transitional instrument by Item 2 of Sched 3 of the Crennan Bell Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (Cth) ("the Transitional Act"). The Agreement passed its nominal expiry date on 19 September 2009 and had not been terminated or replaced by April 2010. The case proceeded on the footing that the terms of the Agreement continued to regulate the employment relationship. Clause 38 of the Agreement was headed "Contract of Service". It contained the following relevant sub-clauses: "STAND DOWNS The Company is entitled to deduct payment for any day or part of a day an Employee cannot be usefully employed because of any strike or any breakdown in machinery or any stoppage of work by any cause for which the Company cannot be reasonably held responsible, as long as the Company has no useful alternative work available. GENERAL CONDITIONS (13) Employees shall have no right to be paid for any time that they are not ready, willing and available to follow all lawful directions of the Company or to carry out all duties that they are capable of performing. ABANDONMENT OF EMPLOYMENT (16) Should an Employee have three (3) consecutive days of unauthorised absence from work, the Employee shall be deemed to have abandoned their employment, unless, through exceptional circumstances they have been unable to communicate their absence to the Company." Crennan Bell Clause 42 of the Agreement provided that "Employees classified as Distant Workers as defined … shall be entitled to the conditions contained at Appendix 7". "Distant Worker" was defined as: "An Employee who is engaged or selected or advised by the Company to proceed from their Usual Place of Residence within Australia to construction work on the Burrup Peninsula and the Employee does so and that work is at such a distance that the Employee cannot return to their Usual Place of Residence each night." "Usual Place of Residence" was defined as: "The Employee's place of residence at which they would usually reside and to which they cannot return to [sic] each night because they have proceeded to work on the Project at the direction of the Company." Appendix 7 contained the following relevant clauses: "(6) The Company shall have the choice of providing each Distant Worker with either suitable board and lodging or paying the Living Away from Home Allowance set out in this Appendix. (16) A Distant Worker shall, for the return journey to the location of their initial engagement, receive the same time, fares and meal payments … provided that no return payments shall be made if the Distant Worker: their employment before terminates or discontinues completing four hundred and eighty (480) Project Working Hours of service on the Site (or prior to the job completion if the work is for less than two months); or is dismissed for incompetence within eight (8) ordinary weeks of commencing on the job; or is dismissed for misconduct." The relevant employees met the definition of "Distant Workers" and the respondent was accordingly obliged by cl 6 of Appendix 7 either to provide them Crennan Bell with suitable accommodation or to pay a living away from home allowance ("LAHA"). The respondent chose to provide their accommodation. Woodside owned the accommodation and the respondent paid Woodside to allow the relevant employees to reside in its premises. On 21 April 2010, the appellant notified the respondent of an intended 28 day stoppage of work on 28 April 2010. On 27 April 2010, the respondent informed the relevant employees that, for the duration of any protected industrial action, the respondent would cease to pay for the relevant employees' accommodation. The respondent required the relevant employees to vacate their accommodation by 6.30 am on 28 April unless they made their own arrangements directly with the management of the accommodation. Legislative context The object of the Act, stated in s 3, is "to provide a balanced framework for cooperative and productive workplace relations that promotes national economic prosperity and social inclusion for all Australians" by means which include those stated in s 3(f): "achieving productivity and fairness through an emphasis on enterprise-level collective bargaining underpinned by simple good faith bargaining obligations and clear rules governing industrial action". Section 19(1) provides: "Industrial action means action of any of the following kinds: the performance of work by an employee in a manner different from that in which it is customarily performed, or the adoption of a practice in relation to work by an employee, the result of which is a restriction or limitation on, or a delay in, the performance of the work; a ban, limitation or restriction on the performance of work by an employee or on the acceptance of or offering for work by an employee; a failure or refusal by employees to attend for work or a failure or refusal to perform any work at all by employees who attend for work; Crennan Bell the lockout of employees from their employment by the employer of the employees." Part 3-3 of the Act deals with industrial action. Within Pt 3-3, Div 2 specifically deals with "protected industrial action", by which employers and employees who are engaged in collective bargaining negotiations for a proposed enterprise agreement are able to advance their competing claims. Its central provision is s 415, which provides, subject to specified exceptions, that no action lies in relation to any protected industrial action under any law in force in a State or Territory. Protected industrial action for a proposed enterprise agreement is defined by s 408 to comprise "employee claim action" (defined in s 409), "employee response action" (defined in s 410) and "employer response action" (defined in s 411). Section 416 provides that an employer engaging in employer response action against employees "may refuse to make payments to the employees in relation to the period of the action." Also within Pt 3-3 of the Act, Div 9 restricts payments to employees relating to periods of industrial action. Section 470(1), the terms of which have already been set out, prohibits an employer making a payment to an employee in relation to the total duration of protected industrial action which an employee engaged or engages in on a day. Section 473 prohibits an employee from accepting, and an employee or employee organisation from asking for, a payment from an employer which would contravene s 470(1). Section 474(1) correspondingly prohibits an employer making a payment to an employee who engaged or engages on a day in any industrial action that is not protected industrial action (the prohibition is on payment to the employee "in relation to … the total duration of the industrial action" if that duration was at least four hours, and otherwise "in relation to … 4 hours of that day") and s 475 correspondingly prohibits an employee from accepting, and an employee or employee organisation from asking for, a payment from an employer which would contravene s 474(1). Sections 470(1), 473, 474(1) and 475 are all civil remedy provisions, contravention of which gives rise to liability to penalty under s 539 of the Act. Section 470(1), by s 470(2), does not apply to a partial work ban. Protected industrial action that amounts to a partial work ban in which an employee engaged or engages against an employer on a day is dealt with in s 471. That section allows the employer, by written notice to the employee, proportionately to reduce the employee's payments in relation to the period starting at the start of the first day on which the employee implemented the partial work ban (or the start of the next day on which the employee performs Crennan Bell work after the day on which the notice was given if that is later) and ending at the end of the day on which the ban ceases. Argued to be relevant to the construction of s 470(1) are several provisions within Pt 2-9 of the Act concerning certain terms and conditions of employment. Section 323 provides: "(1) An employer must pay an employee amounts payable to the employee in relation to the performance of work: in full (except as provided by section 324); and in money by one, or a combination, of the methods referred to in subsection (2); and at least monthly. (2) The methods are as follows: cash; cheque, money order, postal order or similar order, payable to the employee; the use of an electronic funds transfer system to credit an account held by the employee; a method authorised under a modern award or an enterprise agreement. (3) Despite paragraph (1)(b), if a modern award or an enterprise agreement specifies a particular method by which the money must be paid, then the employer must pay the money by that method." to an employee Section 324 allows an employer to deduct an amount from an amount in accordance with s 323(1), amongst other payable circumstances, if the deduction is authorised: in writing by the employee and is principally for the employee's benefit; or by the employee in accordance with an enterprise agreement. Section 332(1) makes clear that an employee's earnings may in some circumstances include "non-monetary benefits", defined in s 332(3) to include "benefits other than an entitlement to a payment of money" to which an employee "is entitled in return for the performance of work" and "for which a reasonable money value has been agreed by the employee and the employer". Crennan Bell The ability to initiate or participate in protected industrial action is, by virtue of sub-ss (1)(b) and (2)(c) of s 341, a "workplace right", in respect of which s 340(1) of the Act relevantly provides: "A person must not take adverse action against another person: because the other person: has a workplace right; or has, or has not, exercised a workplace right; or (iii) proposes or proposes not to, or has at any time proposed or proposed not to, exercise a workplace right; or to prevent the exercise of a workplace right by the other person." By virtue of s 342(1), an employer takes "adverse action" against an employee if the employer "alters the position of the employee to the employee's prejudice" save, relevantly, that by virtue of s 342(3) adverse action does not include action authorised under the Act. The application to the Federal Magistrates Court The appellant applied to the Federal Magistrates Court, seeking relief on the basis that the respondent's refusal to provide accommodation contravened cl 6 of Appendix 7 of the Agreement and constituted adverse action against the relevant employees within the meaning of s 342(1), in contravention of s 340(1) of the Act. Dismissing the application, Lucev FM upheld a submission by the respondent, made at the end of the appellant's case, that the respondent had no case to answer on the basis that the provision of accommodation was the making of a payment prohibited by s 470(1) of the Act. By virtue of s 342(3), the withholding of accommodation therefore could not be adverse action1 and, 1 Construction, Forestry, Mining and Energy Union v Mammoet Australia Pty Ltd (2011) 254 FLR 59 at 84 [114]. Crennan Bell because "[w]hat the [Act] prohibits a collective agreement cannot permit", "[t]he claim for breach of the … Agreement must also therefore fail"2. It was unnecessary for Lucev FM to deal with the respondent's alternative submission that the non-provision of accommodation during the period of protected industrial action did not contravene s 340(1) of the Act or cl 6 of Appendix 7 of the Agreement because the Agreement did not require the respondent to provide accommodation to a Distant Worker if the Distant Worker was not ready, willing and available to work. The reasoning which supported the proposition that the provision of accommodation was the making of a payment prohibited by s 470(1) of the Act was summarised by Lucev FM in the following passage3: "The legislative purpose of s 470 of the [Act], as with its immediate predecessors under the WR Act (variously ss 187AA and 507) is, as it applies to employees taking industrial action, 'that employees are to bear the economic loss of their industrial action'.4 In the circumstances of this case, the Affected Employees would not, contrary to the legislative purpose of s 470 of the [Act], bear the financial consequences of the Protected Industrial Action if Mammoet continued to provide them with the Accommodation (at a cost to Mammoet of $90 per person per day) for the 28-day duration of the Protected Industrial Action. The provision of the Accommodation enables the Affected Employees to live away from home to perform the work so as to earn the other remuneration set out in the … Agreement. The provision of the Accommodation is therefore: (2011) 254 FLR 59 at 84 [115]. (2011) 254 FLR 59 at 83-84 [111]-[113]. 4 O'Shea v Heinemann Electric Pty Ltd (2008) 172 FCR 475 at 487 [32]. See also Independent Education Union of Australia v Canonical Administrators (1998) 87 FCR 49 at 73-74; Ponzio v B & P Caelli Constructions Pty Ltd (2007) 158 FCR Crennan Bell directly related to the work performed by the Affected Employees and to their capacity to earn remuneration for that work; and for reasons set out above, a payment in relation to the work performed by the employee. There is therefore a direct, or at the very least a sufficient and material, connection between the provision of the Accommodation and the work performed by the employees under the terms of the … Agreement. Were the Accommodation to be provided during the period of Protected Industrial Action it would therefore be a 'payment in relation to the total duration of the industrial action on the day of the action'. It would therefore be a payment which must not be made under s 470(1) of the [Act]." (one footnote omitted) This passage highlights the controlling influence of his Honour's view of the perceived legislative purpose that employees should bear, not only the loss of remuneration for the period of protected industrial action, but also the burden of all financial consequences of that action. It also reflects the submission advanced in this Court on behalf of the respondent as to why the provision of accommodation to employees was "in relation to" the total duration of the protected industrial action taken by the relevant employees on the days it took place. The passage invites two observations to which it will be necessary to return in due course. First, on his Honour's view of the legislative purpose, which controls the interpretation of s 470(1) of the Act, an employer must not, on pain of the penalty prescribed by the Act, comply with any contractual or award obligation to employees while they take protected industrial action where the obligation has financial consequences for either party. Secondly, his Honour's conclusion that the relationship required by s 470(1) of the Act, between the "payment to an employee" and "the total duration of the industrial action" on the day or days on which it took place, was satisfied by the "connection between the provision of the Accommodation and the work performed by the employees under the terms of the … Agreement" does not reflect the terms of s 470(1), which is concerned to prohibit a payment where work has not been performed by employees under the terms of the Agreement. The appeal to the Federal Court of Australia The appellant appealed to the Federal Court, where the principal focus of its submissions was that the provision of accommodation under the Agreement Crennan Bell was not a "payment" made "to an employee". In particular, the appellant argued that, in light of s 323(1) of the Act, when s 470(1) of the Act speaks of a "payment to an employee", it necessarily speaks of a payment in money to the employee. Dismissing the appeal, Gilmour J interpreted s 323(1) to mean no more than that an employer must pay an employee "amounts payable to the employee in relation to the performance of work … in money."5 His Honour held that the provision of accommodation by the respondent to each of the relevant employees was a "payment to an employee", but not an amount payable in relation to the performance of work within the meaning of the provision6: "I do not consider that the expression 'payment to an employee' in s 470 should be construed narrowly. The words 'payment' or 'pay' are used variously in the [Act] in combination with other words which have a qualifying or confining effect: 'payment of fees (s 30A(1))'; 'the employer must pay the employee at the employee's base rate of pay for the employee's ordinary hours of work … (s 81(6))'; 'the employer must pay the employee at the employee's base rate of pay for the employee's ordinary hours of work … (s 90(1))' and 'payment of wages and other monetary entitlements (s 139(1)(f)(ii))'. If Parliament had intended that in s 470 the prohibition be solely to the payment of 'wages' or an amount 'payable to the employee in relation to the performance of work' as is found, for example, in s 323(1) then it could have employed that language or language to that effect. It did not do so. Moreover, s 323(1) does not provide, contrary to the appellant's submission that 'employees must be paid "in money"'. Rather, it provides relevantly, that an employer must pay an employee 'amounts payable to the employee in relation to the performance of work … in money'. The relevant payment is thus qualified, which as I have observed is not the case with s 470(1)." (emphasis in original) His Honour considered that the purpose of s 470(1) was to encourage employers and employees to negotiate and resolve disputes by ensuring that each bears the costs of their industrial action, so that the employer bears the cost of 5 Construction, Forestry, Mining and Energy Union v Mammoet Australia Pty Ltd (2012) 206 FCR 135 at 142 [43]. (2012) 206 FCR 135 at 142 [43]. Crennan Bell lost production and the employee receives no payment7. In his Honour's view, this purpose would be undermined if the respondent was permitted to bear the cost of the accommodation8. He explained9: "The appellant's submission, if accepted, would mean, where the provision of accommodation to an employee formed part of his or her wages, that payment of wages by that means was prohibited by s 470. However, where the provision of accommodation did not form part of an employee's wages, but was merely an entitlement, the payment for accommodation, whether to a third party or by way of reimbursement to the employee would not be prohibited. I find that a very unattractive result." His Honour considered that the concept of "payment" in s 470(1) was satisfied here, either as a payment in kind by the respondent by way of the provision of accommodation or as a payment by the respondent to Woodside on behalf of the relevant employees. As to the latter, he saw it as significant that the respondent "provided" the accommodation by paying Woodside for the cost of the accommodation used by the employees10, and saw no relevant difference between the cessation of payment to Woodside for the accommodation and the cessation of payment to employees of LAHA11. He explained12: "It would be an extraordinary result if, by virtue of s 470(1) of the [Act], an employer was prohibited from making payment to its employees of amounts described in the notes to s 323(1) of the [Act], namely, incentive-based payments and bonuses, loadings, monetary allowances, overtime or penalty rates and leave payments but such prohibition did not extend to payments made for accommodation for those employees during the period of protected industrial action." (2012) 206 FCR 135 at 141 [35], [37]. (2012) 206 FCR 135 at 142 [44]. (2012) 206 FCR 135 at 142-143 [45]. 10 (2012) 206 FCR 135 at 143 [46]. 11 (2012) 206 FCR 135 at 143 [47]. 12 (2012) 206 FCR 135 at 143-144 [48]. Crennan Bell His Honour concluded that "payment" in s 470(1) of the Act extends to payments in kind13 and includes the benefit of accommodation provided "to enable the employees to be in a position to perform their employment and earn their pay"14. His view was that a contrary conclusion would have the effect that "it would be the respondent and not the employees who carried that cost of the industrial action", and that such a result "would serve only to undermine the policy of the provision."15 The appeal to this Court In this Court, the appellant again submitted that "payment" in s 470(1) refers to payments in money in conformity with s 323 of the Act. In the alternative, the appellant submitted that, if "payment" in s 470(1) includes the provision of non-monetary benefits such as accommodation, it is nevertheless confined to benefits by way of a quid pro quo for work. The appellant accepted that the purpose of s 470(1) is to deter the taking of protected industrial action, but argued that the provision pursues that purpose by outlawing the payment of "strike pay", that is to say, payment by the employer of the employee's remuneration for a period during which the employee's services were not available to the employer because of the industrial action taken by the employee. The respondent for its part submitted that Gilmour J correctly identified the legislative purpose of s 470(1) of the Act as being to encourage employers and employees to negotiate and resolve disputes by ensuring each bears the cost of industrial action by requiring that the employer bears the cost of lost production and the employee is not paid. To confine the operation of s 470(1) by confining the prohibited payments to those in the nature of a quid pro quo would allow the prohibition to be evaded by the making of a gift. The respondent submitted that Gilmour J was therefore correct to hold that, for the purposes of s 470(1) of the Act, "payment": has a meaning different from "wages" or "earnings"; includes both payment of money and payment in kind; and includes accommodation provided to enable the employees to be in a position to perform their employment and earn their pay. It advanced the proposition (expressly accepted by Lucev FM) that the relationship between the payment to an employee and the "total duration of the industrial action" contemplated by 13 (2012) 206 FCR 135 at 142 [44]. 14 (2012) 206 FCR 135 at 144 [48]. 15 (2012) 206 FCR 135 at 144 [48]. Crennan Bell s 470(1) was satisfied in this case because the provision of accommodation was for the purpose of enabling the relevant employees to work at the location of the Project. The respondent, by notice of contention, also contended that the Agreement on its proper construction did not require the respondent to provide a Distant Worker with accommodation when he or she was not ready, willing and available to work. The respondent submitted that, if its construction of the terms of the Agreement is accepted, its non-provision of accommodation could not constitute "adverse action" under s 342 of the Act. The employees could not have been prejudiced in their employment because they suffered no adverse effect to their existing legal rights. It was said that their rights under the Agreement were unchanged by the respondent's conduct; rather, it was the action of the employees themselves that caused any deterioration in their conditions by reason of their not being ready, willing and available to work and thereby not satisfying cl 6 of Appendix 7 of the Agreement. Application of s 470(1) In Carr v Western Australia16 Gleeson CJ said: "In the interpretation of a provision of an Act, a construction that would promote the purpose or object underlying the Act is to be preferred to a construction that would not promote that purpose or object. … That general rule of interpretation, however, may be of little assistance where a statutory provision strikes a balance between competing interests, and the problem of interpretation is that there is uncertainty as to how far the provision goes in seeking to achieve the underlying purpose or object of the Act. Legislation rarely pursues a single purpose at all costs. Where the problem is one of doubt about the extent to which the legislation pursues a purpose, stating the purpose is unlikely to solve the problem. … Ultimately, it is the text, construed according to such principles of interpretation as provide rational assistance in the circumstances of the particular case, that is controlling. … [T]he general purpose of legislation of the kind here in issue is reasonably clear; but it reflects a political compromise. The competing interests and forces at work in achieving that compromise are well known. 16 (2007) 232 CLR 138 at 142-143 [5]-[7]; [2007] HCA 47. Crennan Bell The question then is not: what was the purpose or object underlying the legislation? The question is: how far does the legislation go in pursuit of that purpose or object?" The idea contained in the last paragraph of this passage was pithily expressed by the Supreme Court of the United States in Rodriguez v United States17: "[N]o legislation pursues its purposes at all costs." One may accept that the purpose of s 470(1) is to allocate the economic loss attributable to industrial action as between employers and employees by requiring employees to bear the burden of the loss of earnings occasioned by the industrial action and the employer to bear the burden of the loss of production. But it is quite plain that the provision does not comprehensively address the allocation of all the costs of industrial action. Nor does it prohibit performance of the entirety of the obligations of an employer to its employees for the duration of the industrial action. Section 470(1) is, rather, directed at a particular kind of transaction: a "payment to an employee" which is "in relation to the total duration of the industrial action" on a day. It is a provision which limits voluntary conduct and sanctions that limitation by the imposition of a penalty. Its text must be read in light of the statutory object expressed in s 3(f) of providing "clear rules governing industrial action". While the full terms of the provision must be borne in mind, it is convenient to organise discussion of its operation into two parts, the first concerned with the transaction of payment to an employee, and the second with the relationship between that transaction and the duration of industrial action. "Payment to an employee" The appellant's argument based on s 323 is not persuasive. The terms of s 323(3) acknowledge that an enterprise agreement may specify a method for the payment of "the money" by a "particular method" other than "in money". The reference in s 323(3) to "the money" is a reference back to the prescription in s 323(1) of "amounts payable to the employee in relation to the performance of work". It is tolerably clear from the terms of s 323(3), and is confirmed by the Explanatory Memorandum which accompanied the Bill for the Fair Work 17 480 US 522 at 525-526 (1987). Crennan Bell Act 200918, that s 323(1) addresses the same mischief addressed by "Truck Acts" as they had by then come to exist in each State19, that is, that an employee's entitlement to payment for work might be compromised by an employer requiring the employee to accept some form of payment in kind of less value than the payment of money forgone. Section 323(3) expressly acknowledges that this mischief is not a concern where the provision is contained in an enterprise agreement. The provision of accommodation by an employer to an employee may involve the transfer from the employer to the employee of an economic benefit. The benefit may even be capable of being measured and expressed in terms of monetary value, by reference to the cost to the employer paid or payable for the accommodation. But that circumstance itself does not mean that there has been a payment by the employer to the employee of that sum. While the signification of "payment" in various sections of the Act may be affected by the particular context in which it appears, none of the other provisions of the Act to which the respondent referred in its argument actually speaks of "payment" of non-monetary benefits. It is true, as Gilmour J noted20, that in other provisions within the Act where the terms "payment" and "pay" are to be found21, the terms are used variously with other words that qualify or confine them, for example "payment of wages and other monetary entitlements" and "pay ... the employee's base rate of pay". It is also true that the term "payment" in s 470(1) is not qualified by the text in which it appears. Nevertheless, the usage of these other provisions is consistently to the effect that when the Act speaks of payment it is speaking of a payment in money. The true construction of "payment" within the meaning of s 470(1) as a payment of money is also suggested by the character of s 470(1) as a civil 18 Australia, House of Representatives, Fair Work Bill 2008, Explanatory Memorandum at 205 [1278]. 19 Industrial Relations Act 1996 (NSW), ss 117-118; Victorian Workers' Wages Protection Act 2007 (Vic), ss 6-7; Fair Work Act 1994 (SA), s 68; Industrial Relations Act 1999 (Q), ss 391-393; Minimum Conditions of Employment Act 1993 (WA), ss 17B-17D; Industrial Relations Act 1984 (Tas), s 51. 20 (2012) 206 FCR 135 at 142 [43]. 21 Fair Work Act 2009 (Cth), ss 30A(1), 81(6), 90(1), 139(1)(f)(ii), 323(1). Crennan Bell remedy provision. It is only a transaction which answers the description of "a payment to an employee" which attracts the penalty imposed22. Like the imposition of criminal liability, the imposition of a civil penalty should be "certain and its reach ascertainable by those who are subject to it."23 That general principle of statutory construction is reinforced in this case by the expressly articulated object of the Act to provide "clear rules governing industrial action"24. These considerations lead us to conclude that liability to the penalty imposed upon a contravention of s 470(1) is not attracted by the transfer of just any economic benefit by an employer to an employee during a period of protected industrial action. Not only would such an imposition be insufficiently clear and of insufficiently ascertainable reach, it would also have the consequence that employers and employees could become liable to a penalty, not only by taking some positive action, but also by doing no more than maintaining the status quo. It is not to be supposed that the legislature intended such a result. "In relation to the total duration of the industrial action" Section 470(1) prohibits the making of "a payment to an employee in relation to the total duration of the industrial action on that day." That is a prohibition upon the making of a payment to recoup, in whole or in part, what would have been payable in relation to the time during which the employee engaged in industrial action had the employee worked during that period. An employee who engages in industrial action does not, for the duration of the industrial action, render the services on which the entitlement to remuneration commonly depends. But to say that is distinctly not to say that entitlements of an employee which are dependent on the subsistence of the contract of employment, rather than the actual performance of services, even if sensibly described as "payments", are "payment[s] … in relation to the total duration of the industrial action". To speak of "a payment to an employee in relation to the total duration of the industrial action" is to speak of a period of 22 Potts' Executors v Inland Revenue Commissioners [1951] AC 443 at 453-455; In re HPC Productions Ltd [1962] Ch 466 at 485. 23 Director of Public Prosecutions (Cth) v Keating (2013) 87 ALJR 657 at 665 [48]; 297 ALR 394 at 404; [2013] HCA 20. See also Trade Practices Commission v TNT Management Pty Ltd (1985) 6 FCR 1 at 47-48. 24 Fair Work Act 2009 (Cth), s 3(f). Crennan Bell employment in respect of which no remuneration is earned by the employee. The concern addressed by s 470(1) of the Act is that the taking of industrial action must not be the occasion of a payment by the employer. The obligation to provide accommodation was not the occasion of the industrial action taken by the relevant employees. The legislative history confirms that the relationship between payment and industrial action contemplated by s 470(1) is that the non-performance of work by the employee is the occasion of the proscribed payment. These indications support the view that the purpose of the provision is to prohibit "strike pay", that is, payments by an employer to "make up", in whole or in part, wages not earned by the employee during the period of industrial action. From 1979 to 1996, there was no prohibition on the making of a payment by an employer to an employee in relation to loss suffered by the employee during a period of industrial action by the employee. The position under s 25A of the Conciliation and Arbitration Act 1904 (Cth), which applied from 25 October 1979 until 28 February 1989, was that an industrial award or agreement, by way of conciliation or arbitration respectively, could not be made "in respect of a claim for the making of a payment to employees in respect of a period during which those employees were engaged in industrial action." Similarly, a dispute over strike pay was excluded from the range of disputes susceptible to resolution under s 124 of the Industrial Relations Act 1988 (Cth), which was in force from 1 March 1989 until 30 December 1996. That state of the law was altered by the enactment of s 187AA(1) of the WR Act, which began operation on 31 December 1996. Until 26 March 2006, s 187AA(1) of the WR Act provided that "[a]n employer must not make a payment to an employee in relation to a period during which the employee engaged, or engages, in industrial action". From 27 March 2006 to 30 June 2009, the WR Act as amended by the Workplace Relations Amendment (Work Choices) Act 2005 (Cth) provided by s 507(1) that: "This section applies if an employee engaged, or engages, in industrial action (whether or not protected action) in relation to an employer on a day." Section 507(2) provided that: "The employer must not make a payment to an employee in relation to: Crennan Bell if the total duration of the industrial action on that day is less than 4 hours—4 hours of that day; or otherwise—the total duration of the industrial action on that day." It is pertinent to note that in the Second Reading Speech which accompanied the Bill introducing s 187AA of the WR Act it was said that25: "It will be unlawful: for an employer to pay strike pay; a union, or its representatives, to take industrial action to pursue strike pay; or for an employee to accept strike pay." In Independent Education Union of Australia v Canonical Administrators, "I consider that s 187AA in the context of Pt VIIIA of the WR Act evinces a policy that collective bargaining should occur in an environment where employer and employee are to appreciate and accept the detrimental consequences for themselves of industrial action used as part of the negotiating armoury. For the employee those consequences are normally loss of remuneration in respect of the period of the industrial action and for the employer they are the loss of production attendant on a lockout. Consistently with that policy, s 187AA is framed to ensure that the loss of remuneration is not recouped after the bargaining is over". The legislative history, the Second Reading Speech, and the observations of Ryan J point strongly to the conclusion that the mischief at which s 470(1) is directed is the payment of strike pay, that is, the making of payments whose relationship to industrial action is to be found in the recoupment of wages lost during the period of the action. There is no suggestion that the purpose of s 470(1) is to suspend the entirety of the employer's obligations under the relationship of employment. Indeed, the Act contemplates the continued subsistence of the employment relationship during and after the industrial action. Whether the prohibition is apt to capture any given payment may depend on the circumstances of the case. For example, a payment by way of a gift might 25 Australia, House of Representatives, Parliamentary Debates (Hansard), 23 May 26 (1998) 87 FCR 49 at 73-74. Crennan Bell be caught if the circumstances were such as to show that it was made by way of recompense for wages not earned. It is not necessary or desirable to attempt an exhaustive statement of those circumstances. It is sufficient for the purposes of this case to say that the entitlement of the relevant employees to accommodation was established under cl 6 of Appendix 7 of the Agreement. The provision of that accommodation was a benefit to which the relevant employees were entitled upon attending at the work site unless and until they were directed to return to their usual place of residence. It was neither a payment of money, nor provided in relation to the non-performance of work during the period of industrial action. Notice of contention The view of the courts below that s 470(1) afforded an answer to the appellant's claims of adverse action and breach of contract meant that the appellant's claim was dismissed. Neither of the courts below addressed the respondent's further contention that the appellant's claim should fail for the reason advanced that the relevant employees were not ready, willing and available to work, and accordingly were not entitled to the provision of accommodation. The respondent seeks to rely on this contention to maintain the decision of the Federal Court. The appellant's primary submission was that this Court should not deal with the notice of contention as it was not addressed below, and because it also involves questions of fact relating to the reasons for which the respondent took the action it did, so that the matter cannot finally be resolved in this Court whatever view is taken of the issues raised by the appeal and the notice of contention. That having been said, it does not appear that the respondent's contention turns on any disputed matters of fact. The respondent submits that, because this contention would justify upholding the decisions below, this Court should deal with it. The decisive consideration favouring dealing with the notice of contention is the circumstance that the resolution of the argument as to the application of s 470(1) of the Act has necessitated some consideration of the terms of the Agreement; and it is undesirable that the ramifications of that consideration upon the respondent's associated arguments relating to the operation of the Agreement should be left in limbo. By virtue of cl 42 of the Agreement, the relevant employees were entitled, as Distant Workers, "to the conditions contained at Appendix 7". Clause 6 of Crennan Bell Appendix 7 of the Agreement entitled the respondent to choose whether to provide each Distant Worker with "suitable board and lodging" or pay LAHA. The Agreement operated upon the employment relationship of the respondent and the relevant employees to effect "an alteration in the rights and obligations of the parties to the contract [of employment], but it did so by force of"27 the WR Act and latterly the Transitional Act. To the extent of any inconsistency between the terms of the employment contract between the parties and the Agreement, the terms of the Agreement prevail28. In this case, the respondent had chosen to provide suitable board and lodging for the relevant employees by virtue of their status as Distant Workers, that is, as employees "advised … to proceed from their Usual Place of Residence within Australia to construction work on the Burrup Peninsula and the Employee does so and that work is at such a distance that the Employee cannot return to their Usual Place of Residence each night." Under the Agreement, the relevant employees' entitlement to suitable board and lodging arose in consequence of their having acted upon the respondent's advice to proceed to the location of the Project. The Agreement does not contain any express provision for the defeasance of an entitlement to accommodation which arose in this way. The respondent argued that the entitlement to accommodation is dependent upon an implied condition that the relevant workers should be ready, willing and available to work during working hours. Absent an implied term of the kind for which the respondent contends, an employee's entitlement to the accommodation would depend employer-employee relationship, pursuant to which the entitlement accrued29. continuance of simply on the It is instructive that the express terms of the Agreement in relation to both travel and accommodation contain no suggestion that the exercise of rights of either party to negotiate in accordance with the provisions of the Act may affect travel or accommodation entitlements. Indeed, the circumstance that sub-cll 6 27 Byrne v Australian Airlines Ltd (1995) 185 CLR 410 at 419; [1995] HCA 24. See also Visscher v Giudice (2009) 239 CLR 361 at 385-386 [71]; [2009] HCA 34. 28 Gapes v Commercial Bank of Australia Ltd (1980) 37 ALR 20 at 21-22, 25. 29 McDonald v Dennys Lascelles Ltd (1933) 48 CLR 457 at 476-477; [1933] HCA 25. Crennan Bell and 13 of cl 38 of the Agreement make express provision for the consequence of a failure by an employee to be available for work suggests that no further implication should be made30. Similarly, cl 16 of Appendix 7 expressly provides for the non-payment of travel costs. The express provisions of the Agreement in relation to the loss of travel entitlements exclude the implication of the condition for which the respondent contends so far as travel entitlements are concerned. The effect of the Agreement is that, while the employment relationship subsists, accommodation is to be provided by the respondent to its employees who have acted upon its instruction to travel to the location of the Project. It is the continuation of the employment relationship and the employee's entitlements under it which is the condition on which the provision of accommodation depends. Finally, even if it were correct to say that the relevant employees ceased to be legally entitled to insist upon the provision of accommodation because they were not ready, willing and available to work, the respondent's denial of accommodation would be an alteration of the position of the relevant employees to their prejudice so as to constitute adverse action within the meaning of s 342 of the Act. Even though the refusal of accommodation would, on this assumption, not be a denial of a legally enforceable entitlement, it would effect a deterioration in the advantage enjoyed by the relevant employees had the refusal of accommodation not occurred. The refusal of the accommodation was not an automatic consequence of the operation of the law upon the conduct of the relevant employees. The denial of the use of accommodation resulted from the respondent's action by way of response to the protected industrial action of the relevant employees. Even if that action put them in breach of the Agreement, the respondent's action in response was a matter of choice by it, a choice which s 340(1) of the Act denied to it. Conclusion The appeal should be allowed. The orders below should be set aside. The application should be remitted to the Federal Circuit Court to be heard and determined according to law. 30 Sandra Investments Pty Ltd v Booth (1983) 153 CLR 153 at 158; [1983] HCA 46.

HIGH COURT OF AUSTRALIA ECOSSE PROPERTY HOLDINGS PTY LTD APPELLANT AND GEE DEE NOMINEES PTY LTD RESPONDENT Ecosse Property Holdings Pty Ltd v Gee Dee Nominees Pty Ltd [2017] HCA 12 29 March 2017 ORDER Appeal allowed with costs. Set aside orders 2 to 5 of the Court of Appeal of the Supreme Court of Victoria made on 4 March 2016 and in their place order that the appeal to that Court be dismissed with costs. On appeal from the Supreme Court of Victoria Representation M J Colbran QC with G D Bloch for the appellant (instructed by Goldhirsch & Shnider) N C Hutley SC with A Hanak for the respondent (instructed by SBA Law) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Ecosse Property Holdings Pty Ltd v Gee Dee Nominees Pty Ltd Contract – Construction and interpretation of contracts – Long-term lease – Standard form contract – Where parties entered lease because unable to effect sale and purchase of land due to planning restrictions – Where standard form lease amended by parties – Where clause pertaining to payment of rates, taxes, assessments and other outgoings ambiguous – Whether parties intended lease to resemble sale and purchase of land – Whether lessee liable to pay all rates, taxes, assessments and other outgoings or only liable to pay those payable in lessee's capacity as tenant. Words and phrases – "commercial purpose and objects", "commercial sense", "deletions from standard form contract", "in respect of the said premises", "payable by the tenant", "reasonable businessperson". KIEFEL, BELL AND GORDON JJ. The facts surrounding the making of the lease that is the subject of this appeal and its terms are set out in Gageler J's reasons. The original lessor was the owner of land which included the land the subject of the lease. Had it not been for town planning restrictions, a subdivision of that land would have taken place and the land the subject of the lease sold to the original lessee. When the parties were unable to achieve a sale and purchase they entered into a lease for a long term, ninety-nine years. The rental for the entire term was paid on entry into the lease. The issue on which the Court of Appeal of the Supreme Court of Victoria divided concerned the significance of cl 13 of the lease to the construction of an ambiguous provision governing liability for the payment of rates, taxes and other outgoings. Clause 13 contained the following information: "The parties acknowledge that it was the intention of the Lessor to sell and the Lessee to purchase the land and improvements hereby leased for the consideration of $70,000.00 and as a result thereof the parties have agreed to enter into this Lease for a term of ninety-nine years in respect of which the total rental thereof is the sum of $70,000.00 which sum is hereby acknowledged to have been paid in full." It is common ground that the consideration there mentioned was more or less equivalent to the market value of the land. The clause on which the appellant relied in bringing the proceedings in the courts below as lessor, for recovery of rates, taxes and other outgoings, from the respondent as lessee, is cl 4, which is in these terms: "AND [the Lessee] also will pay all rates taxes assessments and outgoings whatsoever excepting land tax which during the said term shall be payable by the Landlord or tenant in respect of the said premises (but a proportionate part to be adjusted between Landlord and Tenant if the case so requires)." On the appellant's case, cl 4 obliges the lessee to pay all rates, taxes, assessments and outgoings in respect of the land. On the respondent's case, cl 4 obliges the lessee to pay only those imposts that are levied on it in its capacity as the tenant, leaving the lessor liable to pay those imposts that may be levied on it as owner of the land. For the reasons to be given, the appellant's construction is to be preferred and it follows that the appeal must be allowed. BellJ The appellant's argument focuses on cl 13, which is said to identify the genesis and aim of the transaction between the original lessor and lessee1. Adopting what was said by Kyrou JA, who dissented in the Court of Appeal2, it is said that it was clearly the intention of the parties to recreate, as far as possible, in a lease, the conditions which would have obtained following a sale. On that approach, the position of the lessee under the lease would have more closely resembled that of a purchaser, upon whom liability for rates, taxes and other outgoings would fall. The respondent denies cl 13 the effect for which the appellant contends, observing that the clause does not contain a statement that it was the parties' intention to replicate the conditions of sale and purchase. The respondent points to other reasons for inclusion of cl 13: it was necessary to state the amount of the rent (a need created by the deletion of cl 2), and it was prudent to record that the sum had been paid in full. More generally, the respondent's submission, which found favour with the Court of Appeal majority, is that when the lease is read as a whole there is no warrant for treating cl 13 as an instruction as to its interpretation. It was not disputed in the Court of Appeal that cl 4, as settled by the parties, is ambiguous3 and argument in this Court proceeded upon that acceptance. And it was not disputed that in the circumstances it is open to the court to take account of the words crossed out of the standard form as an aid to the proper construction of the clause4. The deletions do not evidence a prior 1 Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 CLR 337 at 350 per Mason J; [1982] HCA 24. 2 Gee Dee Nominees Pty Ltd v Ecosse Property Holdings Pty Ltd (2016) V ConvR 3 Gee Dee Nominees Pty Ltd v Ecosse Property Holdings Pty Ltd (2016) V ConvR 4 Postle v Sengstock [1994] 2 Qd R 290 at 298 per McPherson JA; Esso Australia Ltd v Australian Petroleum Agents' & Distributors' Association [1999] 3 VR 642 at 647-648 [19] per Hayne J; A Goninan & Co Ltd v Direct Engineering Services Pty Ltd [No 2] (2008) 15 ANZ Insurance Cases ¶61-779 at 76,946 [38]-[40]; and see Lewison and Hughes, The Interpretation of Contracts in Australia, (2012) at 65-66; Timber Shipping Co SA v London & Overseas Freighters Ltd [1972] AC 1 at 15-16 per Lord Reid; Mottram Consultants Ltd v Bernard Sunley & Sons Ltd [1975] 2 Lloyd's Rep 197 at 209. BellJ intent, which could have changed, but rather they identify a matter which, on the face of the document, was rejected by both parties5. The respondent's argument draws on the structure and language of cl 4. The words "Landlord" and "tenant" in the unamended text are not found elsewhere in the lease. Their employment here is suggested to reflect the function of the clause in allocating liability for such enforceable obligations as arise independently of the lease to the lessor and lessee in their respective capacities as landlord and tenant. In the original form of cl 4, the words "AND also will pay", when read with cl 3, identified the party to whom the obligation applied. The words "all rates taxes assessments and outgoings whatsoever excepting land tax" identified the subject of the clause. The words "which during the said term shall be payable by the Landlord or tenant in respect of the said premises" identified the characteristics of the imposts to which the clause applied. The amendments are said by the respondent not to have altered the grammatical structure of the clause, which remains adjectival. The imposts to which the clause applies must have two characteristics: they must be "in respect of the said premises" and they must be "payable by the tenant". It is said the words "payable by the tenant", in their natural and ordinary sense, convey a liability which the tenant is under an enforceable obligation to pay, and which arises independently of the lease. The respondent's construction lays emphasis on the deletion of the words "Landlord or" as signifying the parties' intention that the lessee's obligation be confined to those imposts levied on it as tenant. The respondent also contends that, given the land formed part of a larger parcel, it is to be expected that the mechanism for apportionment contained in parentheses would have been retained had it been the parties' intention to make the lessee liable for the payment of all rates, taxes and other outgoings. The last-mentioned submission directs attention to the concluding words of the clause, "in respect of the said premises". The appellant observes that on the respondent's construction, these words are redundant: if the lessee's liability is confined to the payment of those imposts that are "payable by the tenant" they will necessarily be imposts "in respect of the said premises". The appellant's argument points to the retention of this phrase as a recognised means of conveying that the lessee's liability to pay land tax assessed on the whole of the 5 Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 CLR 337 at 352-353 per Mason J. BellJ lessor's landholdings is confined to the demised land6. On the appellant's construction, the words "payable by the tenant in respect of the said premises" reiterate the lessee's obligation, tying it to the leased premises. It is a construction which the appellant submits rendered the reference to the landlord and the mechanism for apportionment in parentheses in the standard form unnecessary and confusing. The choice to amend cl 4 by crossing out words in the printed text is apt to lessen the force of arguments that depend upon analysis of its grammatical structure. This standard form of farm lease imposed liability on the lessee for the payment of all imposts on the land, save for land tax. As amended, cl 4 reads: "AND [the Lessee] also will pay all rates taxes assessments and outgoings whatsoever which during the said term shall be payable by the tenant in respect of the said premises." As each of the judges below rightly acknowledged, each of the constructions proposed by the parties is plausible. The determination of the proper construction is not advanced by observing that on the appellant's case the phrase "payable by the tenant" is redundant or that on the respondent's case the phrase "in respect of the said premises" is redundant. The amendments to the standard form of lease were poorly crafted. The only explanation for the deletion of the lessee's covenant to the lessor (in relation to all succeeding covenants) in cl 2 and for the retention of cl 3, which in light of the deletion of cl 2 is redundant, is inadvertence. In the circumstances it hardly assists the determination of the proper construction of cl 4 to observe that the effect for which the appellant contends might have been achieved economically by simply deleting the words "excepting land tax". It is well established that the terms of a commercial contract are to be understood objectively, by what a reasonable businessperson would have understood them to mean, rather than by reference to the subjectively stated intentions of the parties to the contract7. In a practical sense, this requires that the reasonable businessperson be placed in the position of the parties. It is from 6 Tooth & Co Ltd v Newcastle Developments Ltd (1966) 116 CLR 167 at 170-171; [1966] HCA 57; Centrepoint Custodians Pty Ltd v Lidgerwood Investments Pty Ltd [1990] VR 411; 112 Acland Street Pty Ltd v Australia and New Zealand Banking Group Ltd (2002) 4 VR 372 at 376 [13] per Ormiston and Phillips JJA; Halsbury's Laws of England, 5th ed, vol 62, par 424. 7 Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640 at 656 [35] and the cases at fn 58; [2014] HCA 7. BellJ that perspective that the court considers the circumstances surrounding the contract and the commercial purpose and objects to be achieved by it8. Clause 4 is to be construed by reference to the commercial purpose sought to be achieved by the terms of the lease. It follows, as was pointed out in the joint judgment in Electricity Generation Corporation v Woodside Energy Ltd9, that the court is entitled to approach the task of construction of the clause on the basis that the parties intended to produce a commercial result, one which makes commercial sense. It goes without saying that this requires that the construction placed upon cl 4 be consistent with the commercial object of the agreement. Consideration of that object invites attention to cl 13. Clause 13 identifies the term of the lease and the amount of the total rental for that term and contains an acknowledgement that it has been paid in full. These statements form part of the operative terms of the lease. What is said at the commencement of cl 13 stands in a different position. It is an explanation of why the parties entered into a lease rather than a sale and purchase, which had been intended. Although expressed in the past tense it may be understood to convey that the circumstances leading to the lease remained unchanged at the time of its execution. Clause 13 explains that in circumstances in which the parties were unable to convey a freehold estate in the land, they had chosen instead to convey a leasehold estate for almost a century for a fixed sum. It is readily to be inferred that this was as close an approximation to their desired outcome as they thought they could arrange. Even without cl 13, the surrounding facts and circumstances which a reasonable businessperson in the position of the parties may be taken to have known would have pointed to that conclusion. Clause 13 itself does not explain how the parties' desire for a sale and purchase was thwarted, but it is a fact that it was the impossibility of subdivision of the land the subject of the lease. The length of the term, prepayment of a sum equivalent to the market value of the land, and the removal of the covenants restricting the lessee's user of and 8 Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640 at 656-657 [35] and the cases at fn 60. (2014) 251 CLR 640 at 656-657 [35]. BellJ capacity to deal with the land10 and the lessor's rights of inspection11 and termination for breach and re-entry12, support the conclusion that the parties' intention was, as Kyrou JA stated it13, to recreate, as far as possible, in a lease, the conditions which would have existed following a sale. The addition of the words "whatever purpose is allowable by law" to the chapeau also supports that conclusion. Clause 13 puts that conclusion beyond doubt. The Court of Appeal majority acknowledged the express statement in cl 13 of the parties' intention, before entering the lease, to effect a freehold sale14. Their Honours considered this explained why the rental for the whole term was paid in a single instalment at the commencement of the lease and why the lessor was given no power to terminate for breach and no power of re-entry. Their Honours considered that it also served to explain the lessee's unfettered rights of assignment and transfer and to build on the land15. Nonetheless, reading the lease as a whole, their Honours were not prepared to find that it was the parties' intention to achieve a transaction that approximated a freehold sale. Their Honours' reservation took into account: (i) that the lessee was burdened by 10 Clause 5, the lessee's covenant to keep the premises in good repair; cl 11, to use the land as a farm in a proper and husband like manner; and cl 13 in its original form, to cultivate the land; see also the addition of cl 16, the lessee's right to repair, rebuild or replace any dwellings or other improvements whether for personal, commercial purposes or otherwise; and cl 15, the lessee's right to assign, transfer, sub-let or grant licences without the consent of the lessor. 11 Clause 8. 12 Clause 10, deletion of the words "or sooner determination"; see also the addition of 13 Gee Dee Nominees Pty Ltd v Ecosse Property Holdings Pty Ltd (2016) V ConvR 14 Gee Dee Nominees Pty Ltd v Ecosse Property Holdings Pty Ltd (2016) V ConvR 15 Gee Dee Nominees Pty Ltd v Ecosse Property Holdings Pty Ltd (2016) V ConvR BellJ continuing obligations16; (ii) the retention of the final proviso17; and (iii) the absence of an option to purchase or a right of renewal, or any provision respecting the improvements at the end of the term18. As Kyrou JA observed, the fact that the rights of the lessee under the lease are not co-extensive with the rights of the owner of the land is not inconsistent with the intention to place the lessee in a position as close as possible to that of the purchaser of a freehold estate19. As Kyrou JA also observed, the retention of the lessee's covenants in cll 6, 7, 10 and 12 serves to protect the lessor's interest in the adjoining land20. They impose limitations of the kind found in restrictive covenants on the subdivision of land. This standard form of farm lease is evidently an old precedent. The final proviso confers on the lessor power to pay any unpaid "rates agreed to be paid by the Lessee as aforesaid" and "distrain sue for or recover" them as if they were arrears of rent under the Landlord and Tenant Acts. As the primary judge 16 Gee Dee Nominees Pty Ltd v Ecosse Property Holdings Pty Ltd (2016) V ConvR ¶54-879 at 65,307 [113]. See cl 6, the lessee's covenant to use best endeavours to keep the land free from rabbits and other vermin and noxious weeds; cl 7, not to destroy timber except for fencing and domestic purposes; cl 10, to deliver up possession of the premises in good repair at the expiration of the term; and cl 12, not to commit any nuisance or suffer anything to be done that might prejudice any insurance in respect of the premises. 17 Gee Dee Nominees Pty Ltd v Ecosse Property Holdings Pty Ltd (2016) V ConvR ¶54-879 at 65,307 [113]. The final proviso is in these terms: "PROVIDED LASTLY and it is hereby agreed and declared that in the event of any rates agreed to be paid by the Lessee as aforesaid being unpaid at any time or times when due to the Shire or Borough or otherwise it shall be lawful for the Lessor to make payment thereof and to distrain sue for or recover as if same were rent in arrears under the Landlord and Tenant Acts." 18 Gee Dee Nominees Pty Ltd v Ecosse Property Holdings Pty Ltd (2016) V ConvR 19 Gee Dee Nominees Pty Ltd v Ecosse Property Holdings Pty Ltd (2016) V ConvR 20 Gee Dee Nominees Pty Ltd v Ecosse Property Holdings Pty Ltd (2016) V ConvR BellJ observed, distress for rent was abolished in Victoria in 194821. The evident purpose of the final proviso was to make summary proceedings for the recovery of rent available as an additional remedy to an ordinary action on the covenants in the lease. The reference to the rates "agreed to be paid by the Lessee" is to cl 4, which the appellant contends is apt to support its construction. However, again, the haphazard amendments made to the printed text lessen the force of that submission. The primary judge was right to consider that the retention of the final proviso is consistent with either construction of the obligation imposed by cl 422. It suffices to observe that its retention does not argue against Kyrou JA's conclusion as to the parties' intention. The Court of Appeal majority's analysis lacks any reason that sounds in commercial sense for the parties to have chosen to amend the usual covenant respecting liability for rates, taxes and other outgoings contained in the standard form with a view to increasing the potential financial burden imposed on the lessor23. The respondent seeks to meet this criticism by submitting that there is insufficient evidence of the "extrinsic details of the transaction" to permit a determination as to the commercial common sense of the Court of Appeal majority's construction. The respondent illustrates the submission by contending that assessment of the commerciality of the agreement would need to take into account the value of the reversion. It would also need to take into account, in the respondent's submission, that at the time the lease was entered into, a lessee in occupation might be levied in relation to rates and land tax. While land tax at that time was usually levied on the owner in respect of the unimproved value of land24, in a case in which the Commissioner of Land Tax was of the opinion that the owner's interest was lessened by the covenants in a lease, he or she was empowered to determine that part of the assessed land tax would be payable by the lessee25. It may be accepted that this lease would have 21 Landlord and Tenant Act 1958 (Vic), s 12. 22 Ecosse Property Holdings Pty Ltd v Gee Dee Nominees Pty Ltd (2014) ANZ ConvR ¶14-020 at 880 [26]. 23 See generally, Chernov, Tenancy Law and Practice: Victoria, 2nd ed (1980) at 103-104; and Woodfall's Law of Landlord and Tenant, vol 1 (Release 106) at 24 Land Tax Act 1958 (Vic), s 6. 25 Land Tax Act 1958 (Vic), s 42(1) and (3). BellJ supported such an assessment26. General rates were levied on the occupier of rateable property and were recoverable from the owner absent agreement to the contrary27. Water and sewerage rates could also have been levied on the lessee in occupation28. Again, absent contrary provision in an agreement, sewerage rates were recoverable from the owner29. Water rates, subject to a limited exception, were not recoverable30. Acceptance that at the time the lease was entered into the lessee may have been levied for land tax and rates and may have had limited rights of recovery against the lessor (any agreement apart) does not explain the commercial sense of amending the clause to increase the lessor's financial obligations. Among other matters, reasonable businesspersons may be taken to appreciate the likelihood that the incidence of rates, taxes and other outgoings on land may be subject to legislative change over the course of a century. Notwithstanding that the consideration was the market value of the land, the lease does not provide an option to renew or to purchase for a nominal sum at the end of the term. The significance of this omission is suggested to favour the conclusion that the parties bargained for the lessor to bear the expense of any imposts levied on it as owner taking into account the value to the lessor of the reversion. An alternative view is the omission was inadvertent; neither the parties nor their advisers turning their minds to how matters might stand in 2087. Kyrou JA was drawn to that explanation31. So are we. A surrounding circumstance of which the reasonable businessperson would be aware is that the lessor company was in receivership. It must be accounted highly unlikely that a receiver would agree to burden the lessor company with uncertain financial obligations over the term of a ninety-nine year lease. The Court of Appeal majority's conclusion failed to give effect to the clear statement of the parties' objective in entering the agreement. It makes no commercial sense, having regard to that objective, for the lessor to remain liable 26 112 Acland Street Pty Ltd v Australia and New Zealand Banking Group Ltd (2002) 4 VR 372 at 376 [13] per Ormiston and Phillips JJA. 27 Local Government Act 1958 (Vic), ss 267(1) and 342(1). 28 Melbourne and Metropolitan Board of Works Act 1958 (Vic), ss 106, 176. 29 Melbourne and Metropolitan Board of Works Act 1958 (Vic), s 177. 30 Melbourne and Metropolitan Board of Works Act 1958 (Vic), ss 106, 108. 31 Gee Dee Nominees Pty Ltd v Ecosse Property Holdings Pty Ltd (2016) V ConvR BellJ for the payment of rates, taxes and other outgoings over the term of the lease. That is especially so where the lessor has taken as consideration for the lease the land value, with no provision for future adjustments. The lessor would have been exposed to uncertainties including the effect that any change of (lawful) land use by the lessee might have had on the amount of any rates, taxes and other outgoings. On its proper construction cl 4 imposes on the lessee the obligation to pay all rates, taxes, assessments and outgoings whatsoever that are payable during the term of the lease in respect of the land. This construction accords with the commercial aim of the parties that the lessee assume the position of owner, so far as a lease may provide, with all of an owner's liabilities. Orders For these reasons, there should be the following orders. Appeal allowed with costs. Set aside orders 2 to 5 of the Court of Appeal of the Supreme Court of Victoria made on 4 March 2016 and in their place order that the appeal to that Court be dismissed with costs. This appeal concerns the construction of an ambiguous term of an unusual and very long lease. The question is whether the term obliges the Lessee to pay all rates, taxes, assessments and outgoings in respect of the leased land or instead only obliges the Lessee to pay those rates, taxes, assessments and outgoings that are levied on the Lessee. In my view, the answer given by the primary judge32 is to be preferred to that given by the majority in the Court of Appeal of the Supreme Court of Victoria33. The answer is that the term obliges the Lessee to pay all rates, taxes, assessments and outgoings in respect of the leased land. The Lessee is accordingly liable to the Lessor for rates and land tax in respect of the leased land that have been levied on the Lessor. The Lease The lease in question was entered into on 19 November 1988, between Westmelton (Vic) Pty Ltd ("Westmelton") as Lessor and Mr Peter Morris as Lessee. The lease is a registered lease for a term of 99 years of 12.15 hectares of land near Melton in Victoria. The 12.15 hectares was at that time part of a larger parcel of nearly 112 hectares of land of which Westmelton was registered proprietor of the estate in fee simple. Subdivision for sale of that larger parcel of land was then prohibited by local planning restrictions. Westmelton was then in receivership. Mr Morris was the stepson of the receiver and manager of The terms and conditions of the lease are set out in a three page memorandum of agreement which was executed by the receiver as agent for Westmelton and by Mr Morris. The memorandum of agreement was evidently prepared by the solicitors instructed by the receiver and the solicitors instructed by Mr Morris adapting the terms of a standard form memorandum of agreement for a farm lease. Taking the printed text of the standard form as their starting point, the solicitors made handwritten deletions and typewritten additions. The result is that the memorandum of agreement as executed is something of a pastiche. The chapeau to the memorandum of agreement first identifies the Lessor and the Lessee. The chapeau next states that "in consideration of the rent hereinafter reserved and of the covenants conditions and agreements hereinafter contained and on the part of the said Lessee to be respectively performed and 32 Ecosse Property Holdings Pty Ltd v Gee Dee Nominees Pty Ltd (2014) ANZ ConvR ¶14-020. 33 Gee Dee Nominees Pty Ltd v Ecosse Property Holdings Pty Ltd (2016) V ConvR observed the said Lessor doth hereby demise and lease" the 12.15 hectares of land identified on an attached plan to the Lessee "in the occupation of whatever purpose is allowable by law with dwellings out-houses and all improvements to have and to hold the same for a term of Ninety-nine (99) years upon the following terms and conditions". The terms and conditions of the lease are then set out in the memorandum of agreement in a series of numbered clauses. Deletions from the printed text of the standard form of cll 1 to 13 are shown as struck through. Additions of a substituted cl 13 and of cll 14 to 16 are shown in typewritten italics. The terms and conditions of the lease as so set out in the memorandum of agreement (omitting only some provisos at the end, which for present purposes are irrelevant) are in their totality as follows: "1. THE term of the tenancy hereby created shall be from the First day of November 1988 to the day of 2. THAT rent for the said term shall be at the clear rental of the first of the said payments to be made on the day of next. And the said Lessee covenants with the Lessor as follows:- 3. THAT the Lessee will pay the rent hereinbefore reserved on the days and in manner hereinbefore appointed for payment hereof. And in the event of the said term being determined by re-entry under the proviso hereinafter contained will pay to the Lessor a proportionate part of the said rent for the fraction of the current year up to the day of such re-entry. 4. AND also will pay all rates taxes assessments and outgoings whatsoever excepting land tax which during the said term shall be payable by the Landlord or tenant in respect of the said premises (but a proportionate part to be adjusted between Landlord and Tenant if the case so requires). 5. AND also will at all times during the said term well and substantially repair maintain scour cleanse and keep in good repair and condition the said premises hereby demised and all fences walls gates hedges ditches drains water courses water holes and other improvements of or belonging to the said demised premises fair wear and damage by fire only excepted. 6. AND also will at his own cost and expense during the said term destroy and use his best endeavours to keep the said land free from rabbits and other vermin thistles and other noxious weeds and will comply with the Vermin and Noxious Weeds Act 1958 and any statutory amendments or re- enactments thereof for the time being respectively and without any notice or notices or order or orders to be served or made thereunder respectively. 7. AND also will not cut down fell ring-bark damage or destroy any timber or trees now or hereafter during the said term growing or standing on the said land except for fencing and domestic purposes. 8. AND also will permit and power is hereby given to the Lessor or its agent with or without workmen or others twice or oftener in every year to enter into and upon the said demised premises or any part thereof to examine the condition thereof and the Lessee agrees to forthwith repair according to notice. 9. AND also will not assign transfer sublet or otherwise part with possession of the said premises or any part thereof without on each occasion first obtaining the consent in writing of the Lessor. 10. AND also will at the expiration or sooner determination of the said term quit and deliver up possession of the said premises in good repair and condition and generally in such state and condition as shall be consistent with the due performance and observance of the foregoing covenants. 11. AND also will use the said land and premises as a farm in a proper and husband like manner and subject to all usual terms covenants and agreements contained in a lease of a farm in addition to those specially contained herein. 12. AND also will not commit any nuisance on the said land nor do nor suffer to be done anything that might prejudice any insurance of the said premises or any part thereof or render necessary the payment of any additional premium beyond the ordinary rate. 13. AND also will cultivate of the said land during the currency of this Agreement. 13. The parties acknowledge that it was the intention of the Lessor to sell and the Lessee to purchase the land and improvements hereby leased for the consideration of $70,000.00 and as a result thereof the parties have agreed to enter into this Lease for a term of ninety-nine years in respect of which the total rental thereof is the sum of $70,000.00 which sum is hereby acknowledged to have been paid in full. 14. Notwithstanding anything contained herein or any act of Parliament Federal or State Regulation or By-law whether as a result of any breach or default of the Lessee or otherwise the Lessor shall not have the power of earlier determination of this Lease or have any power of right of re- entry whatsoever thereby allowing the Lessee quiet and peaceful enjoyment of the land and improvements as aforesaid for the full term of this Lease, regardless of whether or not the Lessee is in breach or default herein. 15. The Lessee shall have the right to assign, transfer, sub-let or grant licences in respect of the premises without obtaining the consent of the Lessor. 16. The Lessee shall without obtaining the consent of the Lessor have the right to repair, rebuild or replace any dwellings, out-houses or other improvements or build further dwellings and out-houses upon the land whether for personal, commercial purposes or otherwise." In 1993, Ecosse Property Holdings Pty Ltd ("Ecosse") purchased the land from Westmelton subject to the lease, thereby becoming the Lessor. In 2004, Gee Dee Nominees Pty Ltd ("Gee Dee") took a transfer of the lease from Mr Morris, thereby assuming the rights and obligations of the Lessee. The proceeding and the outcome below In 2013, Ecosse commenced a proceeding against Gee Dee in the Supreme Court of Victoria. Ecosse claimed a declaration that the lease, on its proper construction, provides that the Lessee is to pay all rates, taxes, assessments and outgoings whatsoever in respect of the land, including land tax. Relying on the construction reflected in that declaration, Ecosse claimed judgment in an amount which it alleged Gee Dee was indebted to it, for rates and land tax levied on it in respect of the land since 2005, together with interest. Gee Dee counterclaimed in the proceeding for a declaration that the lease, on its proper construction, provides that the Lessee is not liable to pay rates, taxes, assessments and outgoings levied on the Lessor in respect of the land. The primary judge (Croft J) made the declaration sought by Ecosse. His Honour adjourned the proceeding insofar as it concerned Ecosse's money claim. Gee Dee appealed to the Court of Appeal, which, by majority (Santamaria and McLeish JJA, Kyrou JA dissenting), allowed the appeal. The Court of Appeal set aside the orders of the primary judge and, in their place, made the declaration sought by Gee Dee. The division of opinion on the central issue Dividing Santamaria and McLeish JJA, on the one hand, and Kyrou JA and Croft J, on the other hand, was the proper construction of cl 4 of the lease. Santamaria, Kyrou and McLeish JJA and Croft J all accepted that the competing constructions advanced by Ecosse and Gee Dee were open on the language of cl 4. All accepted that the proper construction of cl 4 was to be determined by reference to what a reasonable person in the position of the original parties would have understood by that language. All accepted that the language was to be read for that purpose in the context of the memorandum of agreement as a whole and in light of knowledge which the parties can be taken to have had at the time of its execution. Treating the striking through of the words "Landlord or" in the printed text of cl 4 as indicating that the parties considered and rejected the possibility that the Lessee should pay rates, taxes, assessments and outgoings levied on or otherwise payable by the Lessor in respect of the land, Santamaria and McLeish JJA preferred the construction advanced by Gee Dee34. Their Honours emphasised that cl 4 was not tautologous on that construction. The clause served the purpose of enabling the Lessor to hold the Lessee liable to account for failure to satisfy liabilities imposed on the Lessee which might lead to third parties obtaining rights against the land35. Treating cl 13 as indicating that the parties intended the lease to place the Lessee in a position as close to the position of an owner and occupier of the leased land as was possible within the constraints of a lease transaction, Kyrou JA took the same view as Croft J in preferring the construction advanced by Ecosse36. His Honour considered that the words "shall be payable by the tenant", which were left untouched in the standard form of cl 4, were redundant on that construction. He pointed out, however, that the whole of cl 3 (dealing with non-payment of rent) was similarly redundant in light of cl 13's acknowledgement that rent had been paid in full. The redundancy in cl 3 and in cl 4 did nothing more than illustrate the obvious fact that the terms and conditions of the lease as a whole were clumsily drafted37. The appeal to this Court Whatever might have been anticipated at the time of the grant of special leave to appeal, it became apparent from the submissions of the parties in the appeal by Ecosse to this Court that the outcome of the appeal was not going to turn on any contested question of contractual or interpretative principle, let alone 34 Gee Dee Nominees Pty Ltd v Ecosse Property Holdings Pty Ltd (2016) V ConvR 35 Gee Dee Nominees Pty Ltd v Ecosse Property Holdings Pty Ltd (2016) V ConvR 36 Gee Dee Nominees Pty Ltd v Ecosse Property Holdings Pty Ltd (2016) V ConvR ¶54-879 at 65,293 [33], 65,294-65,295 [40]-[42], 65,298 [66]; Ecosse Property Holdings Pty Ltd v Gee Dee Nominees Pty Ltd (2014) ANZ ConvR ¶14-020 at 878- 37 Gee Dee Nominees Pty Ltd v Ecosse Property Holdings Pty Ltd (2016) V ConvR on any question of public importance. Both parties accepted that cl 4 is to be construed by reference to what a reasonable person in the position of the original parties to the lease would have understood by its language, considered in the context of the memorandum of agreement as a whole and against the background of the knowledge which the original parties to the lease can be taken to have had at the time of its execution. Neither party suggested that the language could be understood other than by taking into account that the text was in a printed standard form from which words had been struck through. Gee Dee argued that cl 4 maintains the linguistic structure of the text in the original printed standard form. The opening words – "AND also will pay" – impose an obligation on the Lessee. The rest of the clause is devoted to identifying the content of that obligation: what the Lessee is to pay. What the Lessee is to pay is "all rates taxes assessments and outgoings whatsoever ... which during the [99-year] term shall be payable by the ... tenant in respect of the said premises". Had the original parties intended the Lessee's obligation to the Lessor to extend to paying all rates, taxes, assessments and outgoings, Gee Dee argued, they could easily have expressed that intention unambiguously: by also striking through the words "by the tenant". Gee Dee argued that the clause reflects a choice by the original parties that the Lessee's obligation to the Lessor was instead to be limited to paying those rates, taxes, assessments and outgoings that would become payable during the term of the lease by the Lessee in its capacity as the tenant of the land. That choice is hardly surprising, Gee Dee argued, given that applicable land tax, council rates and water and sewerage rates were in 1988 potentially payable by the tenant of the land38 and that only later did some become payable by the owner39. Had the original parties intended the Lessee's obligation to the Lessor to extend to paying all rates, taxes, assessments and outgoings in respect of the land, Gee Dee went on to argue, there would have been no reason for them to have struck through the concluding words which appeared in parentheses in the original text in the printed standard form of the clause. Gee Dee argued that those words were directed to ensuring that the Lessee paid a proportionate part of rates, taxes, assessments and outgoings payable by the Lessor by reason of its ownership of the larger parcel of land. The same process of apportionment, it 38 Land Tax Act 1958 (Vic), s 42; Local Government Act 1958 (Vic), s 267(1)(b); Melbourne and Metropolitan Board of Works Act 1958 (Vic), ss 98, 176. 39 Local Government Act 1989 (Vic), s 156. argued, might be implicit in the words "in respect of the said premises"40, which remain, but it would be odd to delete an express provision only to achieve the same result by implication. Ecosse argued that the striking through of the words "Landlord or" resulted in an alteration of the linguistic structure of cl 4 from that of the text in the printed standard form. The words "which during the [99-year] term shall be payable by the ... tenant in respect of the said premises" – originally an adjectival clause qualifying the phrase "all rates taxes assessments and outgoings whatsoever" – have become additional words of obligation. Those additional words of obligation serve to reiterate the intention of the original parties that all rates, taxes, assessments and outgoings that would become payable in respect of the land by the Lessor or the Lessee during the term of the lease would be payable by the Lessee alone. The words in parentheses in the original printed standard form, Ecosse argued, were always redundant in light of the words "in respect of the said premises". Their deletion changed nothing of substance. Given that the lease was for 99 years, Ecosse argued, the original parties were unlikely to have been content to leave the incidence of rates, taxes, assessments and outgoings to the vagaries of legislative variation. They opted instead for the certainty of casting the obligation to pay invariably on the Lessee. The preferable construction of cl 4 Clause 4 can only be so construed for what it is: a clumsily tailored variation of an ill-fitting off-the-shelf precedent. To bring linguistic and grammatical precision to its construction would be to burden the clause with more weight than its jumble of words will bear. The competing constructions of cl 4 being open on its language, and the textual indications in favour of each being at best equivocal and at worst conjectural, the choice between them comes down to deciding which is more reasonable considered as a matter of "commercial efficacy or common sense"41. This is a lease for 99 years. The lease is without any restriction as to the purpose to which the land may be put by the Lessee. That is made clear by the chapeau and is spelt out further in cl 16. The lease is also without restriction as to the ability of the Lessee to transfer or to sublet. That is spelt out in cl 15. The 40 See for example Tooth & Co Ltd v Newcastle Developments Ltd (1966) 116 CLR 167 at 170-171; [1966] HCA 57. 41 Gollin & Co Ltd v Karenlee Nominees Pty Ltd (1983) 153 CLR 455 at 464; [1983] HCA 38. Lessor is to have no ability to determine the lease or to re-enter the land during the 99-year term even if the Lessee is in breach or default. So says cl 14. Clause 13 reveals that the lease resulted from earlier intended sale of the land by Westmelton to Mr Morris. Clause 13 also reveals that the single lump sum rental payment of $70,000 was of the amount which had earlier been agreed as the price for that sale. The clause indicates that the commercial purpose of the parties in entering into the lease for 99 years was to replicate the sale which planning restrictions evidently thwarted. That the replication was imperfect, because the transaction had to take a different form, does not detract from the significance of the commercial purpose so indicated. Had the intended sale proceeded, Westmelton would obviously have had no responsibility for any rates, taxes, assessments and outgoings that might at any time afterwards have become applicable in respect of the land. For Westmelton under the lease to assume contractual responsibility for all rates, taxes, assessments and outgoings to which it might as Lessor become statutorily liable in respect of the land for the next 99 years, without any corresponding increase in the lump sum amount it was to receive from Mr Morris, would have been for Westmelton to assume an ongoing commercial risk to which it would not have been exposed if the transaction had gone ahead as a sale. One consequence of the transaction taking the form of a lease was, of course, that Westmelton would hold the reversion. But the value of the reversion under a lease for such a long period cannot without evidence readily be inferred to have been commercially significant. Nothing in the terms of the lease or the context in which the lease was executed suggests that assumption of the risk might be commercially explicable as to the quid pro quo for the value of the reversion. The fact that a receiver acted as agent for Westmelton in entering into the transaction makes attribution of an intention to expose Westmelton to such risk even more problematic. Kyrou JA explained42: "This is because a receiver's duty is to act promptly to take control of the secured property and to take all reasonable care to sell such of that property as is required to pay the secured debt for not less than the market price of the property. Where, as in the present case, part of the secured property cannot be sold, it is understandable that a receiver and manager might agree to a long-term lease involving prepayment of the entire rent in substitution for a proposed sale. However, it would not make any commercial sense for a receiver and manager of a company who enters into such a substituted transaction to burden the company – which would 42 Gee Dee Nominees Pty Ltd v Ecosse Property Holdings Pty Ltd (2016) V ConvR ¶54-879 at 65,295 [47] (footnote omitted). not have been in the best financial health – with long-term obligations to pay Imposts pursuant to a bespoke lease in circumstances where those obligations would not apply if a pro forma lease were entered into." Having regard to those considerations of commercial purpose and commercial context, I think that the view which makes the most commercial sense is that cl 4 was intended to place Westmelton, as Lessor, in a position in relation to rates, taxes, assessments and outgoings in respect of the land that was as near as possible to the position in which Westmelton would have stood as vendor had it sold and not leased the land to Mr Morris. On that basis, I consider that Ecosse's construction is preferable. Orders I agree with the form of orders proposed by Kiefel, Bell and Gordon JJ. Nettle NETTLE J. This is an appeal from a decision of the Court of Appeal of the Supreme Court of Victoria43 on appeal from a decision of a judge of the Supreme Court of Victoria44. It concerns the correct construction of a lease of land. The question is whether, upon its proper construction, cl 4 of the lease obliges the Lessee to pay "all rates taxes assessments and outgoings whatsoever" (hereinafter "rates and taxes") imposed in respect of the leased land during the term of the lease or to pay only those rates and taxes for which the Lessee is liable qua tenant. The primary judge (Croft J) held in favour of the former construction. On appeal, a majority of the Court of Appeal (Santamaria and McLeish JJA, Kyrou JA dissenting) held in favour of the latter. For the reasons which follow, the majority in the Court of Appeal were correct and the appeal should be dismissed. The facts The facts emerge from the judgment of McLeish JA. The lease was entered into on 19 November 1988 between Westmelton (Vic) Pty Limited (receiver and manager appointed) ("Westmelton") as Lessor and Mr Peter Morris as Lessee for a term of 99 years at a total rent of $70,000 payable in full at the commencement of the lease. In about 1993, Ecosse Property Holdings Pty Ltd ("the appellant") acquired the leasehold reversion from Westmelton. By a transfer of lease dated 15 October 2004, Mr Morris assigned and transferred the term of the lease to Gee Dee Nominees Pty Ltd ("the respondent"). Accordingly, the parties to the appeal are successors in title to the parties who entered the lease. The lease, which is a printed standard form "farm lease", was extensively amended by the parties before it was executed. Various parts of the printed provisions were struck out and some clauses added. A number of those amendments were to reflect the fact that the lease was granted for a term of 99 years and that the rent for the whole of the term was paid in full at the commencement of the lease. The leased land comprises 12.15 hectares and was part of a larger parcel of land described in Certificate of Title Volume 7484 Folio 127. At the time of entry into the lease, the larger parcel of land was one of three contiguous "broadacre" lots that Westmelton was subdividing in stages for residential development. At that time, the extant planning scheme restrictions on freehold subdivision prevented the freehold sale of the leased land. On 7 November 2011, 43 Gee Dee Nominees Pty Ltd v Ecosse Property Holdings Pty Ltd (2016) V ConvR 44 Ecosse Property Holdings Pty Ltd v Gee Dee Nominees Pty Ltd (2014) ANZ ConvR ¶14-020. Nettle a separate title was issued in respect of the leased land. Since then, the leased land has been assessed separately for rates and land tax. The leased land has not been subdivided, however, and, until the lease expires, it cannot be. It remains rural farming land. The provisions of the lease The relevant provisions of the lease are as follows. The italicised words and clauses indicate amendments or additions to the printed standard form lease. The parts of the lease that are struck through indicate the intended deletions. THE term of the tenancy hereby created shall be from the First day of November 1988 to the [blank] day of [blank] THAT rent for the said term shall be at the clear [blank] rental of [blank] the first of the said [blank] payments to be made on the [blank] day of [blank] next. And the said Lessee covenants with the Lessor as follows:  THAT the Lessee will pay the rent hereinbefore reserved on the days and in manner hereinbefore appointed for payment hereof. And in the event of the said term being determined by re-entry under the proviso hereinafter contained will pay to the Lessor a proportionate part of the said rent for the fraction of the current year up to the day of such re-entry. AND also will pay all rates taxes assessments and outgoings whatsoever excepting land tax which during the said term shall be payable by the Landlord or tenant in respect of the said premises (but a proportionate part to be adjusted between Landlord and Tenant if the case so requires). AND also will at all times during the said term well and substantially repair maintain scour cleanse and keep in good repair and condition the said premises hereby demised and all fences walls gates hedges ditches drains water courses water holes and other improvements of or belonging to the said demised premises fair wear and damage by fire only excepted. AND also will at his own cost and expense during the said term destroy and use his best endeavours to keep the said land free from rabbits and other vermin thistles and other noxious weeds and will comply with the Vermin and Noxious Weeds Act 1958 and any statutory amendments or re-enactments thereof for the time being respectively and without any notice or notices or order or orders to be served or made thereunder respectively. Nettle AND also will not cut down fell ring-bark damage or destroy any timber or trees now or hereafter during the said term growing or standing on the said land except for fencing and domestic purposes. AND also will permit and power is hereby given to the Lessor or its agent with or without workmen or others twice or oftener in every year to enter into and upon the said demised premises or any part thereof to examine the condition thereof and the Lessee agrees to forthwith repair according to notice. AND also will not assign transfer sublet or otherwise part with possession of the said premises or any part thereof without on each occasion first obtaining the consent in writing of the Lessor. 10. AND also will at the expiration or sooner determination of the said term quit and deliver up possession of the said premises in good repair and condition and generally in such state and condition as shall be consistent with the due performance and observance of the foregoing covenants. 11. AND also will use the said land and premises as a farm in a proper and husband like manner and subject to all usual terms covenants and agreements contained in a lease of a farm in addition to those specially contained herein. 12. AND also will not commit any nuisance on the said land nor do nor suffer to be done anything that might prejudice any insurance of the said premises or any part thereof or render necessary the payment of any additional premium beyond the ordinary rate. 13. AND also will cultivate [blank] of the said land during the currency of this Agreement. The parties acknowledge that it was the intention of the Lessor to sell and the Lessee to purchase the land and improvements hereby leased for the consideration of $70,000.00 and as a result thereof the parties have agreed to enter into this Lease for a term of ninety- nine years in respect of which the total rental thereof is the sum of $70,000.00 which sum is hereby acknowledged to have been paid in full. 14. Notwithstanding anything contained herein or any act of Parliament Federal or State Regulation or By-law whether as a result of any breach or default of the Lessee or otherwise the Lessor shall not have the power of earlier determination of this Lease or have any power of right of re-entry whatsoever thereby allowing the Lessee quiet and peaceful enjoyment of the land and Nettle improvements as aforesaid for the full term of this Lease, regardless of whether or not the Lessee is in breach or default herein. The Lessee shall have the right to assign, transfer, sub-let or grant licences in respect of the premises without obtaining the consent of the Lessor. The Lessee shall without obtaining the consent of the Lessor have the right to repair, rebuild or replace any dwellings, out-houses or other improvements or build further dwellings and out-houses upon the land whether for personal, commercial purposes or otherwise. PROVIDED ALWAYS and these presents are upon the express condition that in case the said rent hereby reserved or any part thereof shall at any time be in arrear for fourteen days after becoming due although no legal or formal demand shall have been made for payment thereof or in case of the breach or non-observance of any of the covenants by the Lessee herein contained or if the Lessee shall become insolvent or liquidate his estate by arrangement or execute any deed or arrangement within the meaning of the Bankruptcy Act 1924-66 it shall be lawful for the Lessor or [blank] agent or any person authorized by [blank] in his behalf thereupon at any time thereafter notwithstanding the waiver or non-exercise of any previous default or right of re-entry to distrain for such rent or proportionate part thereof as aforesaid and to re-enter upon the said premises or any part thereof with a view to determine this lease and thereupon the lease and the term hereby granted shall cease and determine accordingly but without releasing the Lessee from any liability in respect of the breach or non- observance of any covenants on the Lessee's part herein contained. PROVIDED LASTLY and it is hereby agreed and declared that in the event of any rates agreed to be paid by the Lessee as aforesaid being unpaid at any time or times when due to the Shire or Borough or otherwise it shall be lawful for the Lessor to make payment thereof and to distrain sue for or recover as if same were rent in arrears under the Landlord and Tenant Acts." The proceedings at first instance The primary judge considered that cl 13 of the lease, coupled with the absence from the lease of some of the onerous obligations commonly imposed on lessees, signified that the document was intended to be, in effect, a conveyance of the freehold title45. It followed, in his Honour's view, that cl 4 of the lease should 45 Ecosse (2014) ANZ ConvR ¶14-020 at 882 [33], 885 [39]. Nettle not be construed as imposing obligations on the Lessor that would be inconsistent with the position that would have obtained if the parties had achieved a conveyance of freehold title. Consequently, cl 4 should not be construed as imposing an obligation on the Lessor to pay rates and taxes imposed in respect of the land throughout the term of the lease46. The primary judge accepted that the terms of cl 4 of the lease were ambiguous, and accordingly that it was permissible to have regard to the deleted words and clauses appearing on the face of the lease in order to assist in the construction of cl 447. But his Honour rejected the respondent's submission that the deletion from cl 4 of the phrase "excepting land tax" signified that the parties had turned their attention to the issue of liability to land tax to be borne by the Lessee and that the deletion of the words "Landlord or" signified that rates and taxes (including land tax) payable by the Lessor had been deliberately excluded from what should be payable by the Lessee48. The primary judge held that the deletion from cl 4 of the phrase "excepting land tax" showed only that the expression "all rates taxes assessments and outgoings whatsoever" included land tax, and that deletion of the words "Landlord or" was consistent with a contractual intention that the Lessor pay nothing by way of rates and taxes, whether or not those amounts were levied on the Lessor qua owner49. In his Honour's view, it was apparent that such amounts were intended to be "payable by the tenant". He found that the likelihood of that being the contracting parties' intention was supported by the deletion of the words "but a proportionate part to be adjusted between Landlord and Tenant if the case so requires". He reasoned that, if it were intended that the Lessee alone was liable to pay regardless of the party on whom the rates and taxes were levied, there would be no need for any adjustment, and thus that the parties had determined that there was no need of a provision for adjustment50. On that basis, his Honour declared that, upon its proper construction, cl 4 of the lease provided that the Lessee shall pay all rates and taxes whatsoever in respect of the leased land, including land tax. 46 Ecosse (2014) ANZ ConvR ¶14-020 at 887 [47]. 47 Ecosse (2014) ANZ ConvR ¶14-020 at 876 [15]. 48 Ecosse (2014) ANZ ConvR ¶14-020 at 886 [42], 887 [44]-[45]. 49 Ecosse (2014) ANZ ConvR ¶14-020 at 881 [30], 887 [45]. 50 Ecosse (2014) ANZ ConvR ¶14-020 at 887 [45]. Nettle The proceedings before the Court of Appeal In the Court of Appeal, McLeish JA, with whom Santamaria JA agreed51, accepted that cl 4 is ambiguous52 and susceptible of each of the two meanings for which the parties respectively contended53. On the respondent's construction, it imposes an obligation on the Lessee confined to the payment of rates and taxes payable by the Lessee qua tenant in respect of the leased premises. On the appellant's construction, it imposes an obligation on the Lessee to pay all rates and taxes in respect of the leased premises. But, as his Honour observed, there are a number of reasons to prefer the respondent's construction. The appellant's contentions Before this Court, the appellant's contentions largely followed the dissenting reasoning of Kyrou JA. It was submitted that it is necessary to read cl 4 as a reasonable businessperson would read it, having regard to the genesis of the transaction and its context, and so as to avoid commercial nonsense and inconvenience. It was said to be apparent from cl 13 of the lease that the genesis of the transaction was a thwarted intention to enter into a sale and purchase of the land, and thus that to construe cl 4 as the majority in the Court of Appeal did would be productive of a commercial nonsense and inconvenience. It would mean that the Lessor would be liable to pay rates and taxes for a term of 99 years for land which, in substance, is enjoyed by the Lessee as if the Lessee were the owner. By contrast, it was submitted, the construction of cl 4 for which the appellant contends accords with what a reasonable bystander would inevitably adopt. Given that the Lessee's use and enjoyment of the leased land far exceeds the use and enjoyment available under a conventional lease, and is in effect tantamount to ownership, it makes commercial sense to suppose that the contracting parties intended the Lessee to be liable for all rates and taxes imposed in respect of the land. And, in the appellant's submission, the nature of the leased land and the fact that it is held for the purpose of eventual subdivision, together with the fact that Westmelton was in receivership at the time of entry into the lease (and so would not have been likely to accept a long-tail burden in respect of land of which it was seeking to divest itself), makes it even more appropriate that the lease be construed as rendering the Lessee liable for all rates and taxes in respect of the leased land. By contrast, in the appellant's submission, the construction of cl 4 adopted by the majority in the Court of Appeal is capricious, unreasonable, inconvenient 51 Gee Dee Nominees (2016) V ConvR ¶54-879 at 65,289 [1]. 52 Gee Dee Nominees (2016) V ConvR ¶54-879 at 65,305-65,306 [99]-[103]. 53 Gee Dee Nominees (2016) V ConvR ¶54-879 at 65,307-65,308 [118]-[119]. Nettle the Leased Land within and unjust, and ignores the effect of relevant provisions. The majority were in error in treating cl 13 of the lease as a mere statement of past intention54. It should properly be seen as a statement of the genesis of the transaction and a declaration of intent "to place the Lessee as close as possible to the position of an owner/occupier of lease transaction"55. And, according to the appellant, the majority further erred in treating the absence of an option to purchase and a right of renewal as significant indicators of an absence of that intention56. In the appellant's submission, it is just as likely that, because the parties were committing to such a long-term lease, they were not concerned to deal with what would follow at the end of that term. To ask why such options were not included was an exercise in speculation that could shed no light on the constructional choice. the constraints of a Further, in the appellant's submission, the provisions of the lease which oblige the Lessee to keep the land free of vermin and noxious weeds; not to damage timber or trees except for fencing and domestic purposes; not to commit any nuisance or do anything which might prejudice or increase the cost of insurance; and to deliver up the land in good repair and condition at the end of the term, do not suggest an absence of intention to make the transaction as far as possible equivalent to a sale and purchase of the land. Those terms are explicable by the fact that Westmelton retained all of the land adjoining the leased land and was seeking to protect that adjoining land, rather than the reversion in the leased land. Finally, it was said that the majority in the Court of Appeal erred in concluding57 that there was no evidence, and that it could not be assumed, that the burden of the rates and taxes that might be imposed on the Lessor according to the respondent's preferred construction would transform the asset of the lease into a liability for the Lessor. In the appellant's submission, there was evidence, to which the primary judge had regard58, that the financial consequences of the construction of cl 4 for which the respondent contends would impose a burden on the Lessor running to millions of dollars over the term of the lease. It would have been self-evident to the contracting parties that the right of the Lessee to build on the land for commercial purposes without the consent of the Lessor (cl 16) might lead to an increase in the statutory charges and the rateable value of 54 Gee Dee Nominees (2016) V ConvR ¶54-879 at 65,307 [114]. 55 Gee Dee Nominees (2016) V ConvR ¶54-879 at 65,293 [33] per Kyrou JA. 56 Gee Dee Nominees (2016) V ConvR ¶54-879 at 65,307 [116]. 57 Gee Dee Nominees (2016) V ConvR ¶54-879 at 65,306 [107], 65,309 [128]-[129]. 58 Ecosse (2014) ANZ ConvR ¶14-020 at 881 [29]. Nettle the leased land. That makes it all the more likely that the parties intended that the Lessee should be liable for all such rates and taxes. Any other view of the matter was so uncommercial and so unlikely that it should have been rejected. Construction of the lease Relevant principles of construction As the majority in the Court of Appeal recognised59, it is necessary to construe cl 4 objectively by reference to what a reasonable person in the position of the contracting parties would have understood to be the meaning of its language60 when read in light of the document as a whole and the surrounding circumstances known to the parties at the time of the transaction61. As the majority also recognised, it is permissible to have recourse to words and clauses deleted from a standard form or common form agreement, but which remain legible on the face of the document, for the purposes of construing ambiguous language in the executed agreement62. Neither party contended otherwise. Essentially, the appellant's submissions were confined to the way in which the majority applied those principles and, in particular, to the conclusions to which their Honours came. The significance of cl 13 Contrary to the appellant's submissions, there is no error in the significance which the majority in the Court of Appeal attributed to cl 13 of the lease. As McLeish JA remarked63, it is telling that cl 13 refers in the past tense to 59 Gee Dee Nominees (2016) V ConvR ¶54-879 at 65,302-65,303 [88]. 60 Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451 at 461-462 [22]; [2004] HCA 35; Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165 at 179 [40]; [2004] HCA 52. 61 Pacific Carriers (2004) 218 CLR 451 at 461-462 [22]; Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640 at 656-657 [35] per French CJ, Hayne, Crennan and Kiefel JJ; [2014] HCA 7; Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104 at 116 [46]-[47] per French CJ, Nettle and Gordon JJ; [2015] HCA 37. 62 A Goninan & Co Ltd v Direct Engineering Services Pty Ltd [No 2] (2008) 15 ANZ Insurance Cases ¶61-779 at 76,945-76,946 [37]-[40] per Buss JA (Martin CJ and McLure JA agreeing at 76,935 [1], [2]), and the authorities cited therein. See generally Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 CLR 337 at 352-353 per Mason J; [1982] HCA 24. 63 Gee Dee Nominees (2016) V ConvR ¶54-879 at 65,307 [115]. Nettle the intention of the Lessor to sell, and of the Lessee to purchase, the land for $70,000. It is inapt to describe that as evidencing an intention to replicate as far as possible a conveyance of the land. The natural and ordinary meaning of the clause is that, although it was previously the parties' intention to enter into a sale and purchase agreement in respect of the land, once that proved impossible, the parties resolved instead to enter into a lease for a term of 99 years for a total rent of $70,000. As McLeish JA observed, that falls "well short of stating that the parties intend to replicate, so far as possible, a sale and purchase" of the land64. Further, if it had been the intention of the parties that the lease resemble as nearly as possible a sale and purchase of the land, the Lessee would surely have insisted on being granted, and the Lessor would have been prepared to grant the Lessee, an option to purchase the land for nominal consideration, or at least an option to renew the lease for a further extended term at nominal rent. Instead, in utter opposition to the notion of making the transaction resemble as far as possible a sale and purchase of the land, the lease imposed an unqualified obligation on the Lessee to deliver up the land at the expiration of the term in good repair and condition without any provision for compensation in respect of improvements made in the meantime. Furthermore, even allowing for the duration of the lease, the idea that the parties overlooked the need to provide for what was to occur at the end of it is unrealistic. These were commercial parties, who were professionally advised, dealing with land which, as the appellant admitted, had "potential for development as a residential subdivision", in an area of Melton, on the outskirts of metropolitan Melbourne, where, at the time of entry into the lease, development for the purpose of residential subdivision was being actively pursued. The natural inference is that, so far from overlooking the need to provide for what was to occur at the end of the lease, the parties intendedly retained the express unqualified obligation for the Lessee to deliver up the land at the expiration of the term in good repair and condition without compensation for improvements. As was earlier observed, a commercial contract is to be construed objectively according to business commonsense. So construed, it presents as probable that, when the parties amended the standard form lease as they did, an option to purchase and a right of renewal were not included in (or added to) the lease, and a covenant for the Lessee to deliver up the land at the end of the term was included (or not deleted), because the Lessor was not prepared to give up the reversion. The clear implication is that the parties did not intend to make the transaction in effect equivalent to a sale and purchase of the land. 64 Gee Dee Nominees (2016) V ConvR ¶54-879 at 65,307 [114]-[115]. Nettle The appellant sought to resist that conclusion by calling attention to the quantum of the rent in cl 13. But the fact that the total rent paid was commensurate with the parties' estimate of the market freehold value of the land at the time of entry into the lease65 does not point unambiguously in favour of a construction of cl 13 that imputes to the parties an intention to effect a transaction as close as possible to a sale and purchase of the land. Under the lease, both the Lessor and the Lessee accrued benefits which they would not have accrued under a contract of sale. As has just been noted, the Lessor obtained the value of the reversion and, as will be discussed below, the Lessee avoided liability for any future rates and taxes that might be levied upon the owner of the land. Such rates and taxes did, in fact, eventuate and, in the appellant's submission, have been significant. Viewed objectively, however, it is not improbable that $70,000 represented the figure arrived at and agreed upon as rent after the contracting parties balanced their various interests. The significance of other covenants There was also no error in the significance which the majority in the Court of Appeal attributed66 to the provisions of the lease that oblige the Lessee to keep the land free of vermin and noxious weeds (cl 6); not to damage timber or trees except for fencing and domestic purposes (cl 7); not to commit any nuisance and not to do anything which might increase the cost of insurance (cl 12); and to keep the premises in good repair and condition for the purpose of delivery up at the end of the lease (cl 10). It is true that the covenants comprised in cll 6, 10 and 12 (although less so the covenant in cl 7) might provide as much benefit to the Lessor in terms of protecting the Lessor's interests in the adjoining lands as they do in protecting the Lessor's reversion in the leased land. But it does not follow that they can be ignored as significant indicators of the parties' intention that the essential nature of the relationship established by the lease should be one of landlord and tenant. They are just the kind of covenants to be expected in a lease of land, regardless of whether they also serve to protect the Lessor's interests in the adjoining lands. As such, they are an objective indicator of the nature of the lease-like relationship that the parties intended to achieve which points away from an intention to create a transaction which as far as possible resembles a sale and purchase of the land. Evidence of financial consequences The appellant's contention that there was evidence as to the financial consequences of the respondent's preferred construction of cl 4, and that it would involve "millions and millions of dollars", is overstated. The primary judge 65 See Ecosse (2014) ANZ ConvR ¶14-020 at 882 [33]. 66 Gee Dee Nominees (2016) V ConvR ¶54-879 at 65,307 [113]. Nettle made no finding as to the financial consequences of either construction, and his Honour was not asked to do so67. Still less was it established that it would have been evident to the parties at the time of entry into the lease that, if the Lessor were required to bear all rates and taxes except those payable by the Lessee qua tenant, it would necessarily render the lease a liability for the Lessor. At the time of entry into the lease, general rates imposed by municipal councils were levied, subject to some limited exceptions, on a lessee as the occupier of land68; and, although there was a statutory right for a person "rated as occupier of any rateable property ... to recover" a paid amount from the person to whom the former was liable to pay rent, there was no entitlement to recover where a lease provided otherwise69, as cl 4 did. Further, although the larger parcel of land of which the leased land formed part was also rateable property for the purposes of s 251(1), s 254(3) of the Local Government Act 1958 (Vic) provided that general rates could be determined in respect of land "which forms portion of a larger property" and levied on the occupier of that portion. As was earlier mentioned, a lessee "rated as occupier" could not recover that amount from a lessor if such rates were payable by the lessee under the relevant lease, as was the case here. Water and sewerage rates were recoverable by the relevant authority from the occupier of land70. In relation to water rates, an occupier could only recover from rent payable to a lessor an amount that exceeded "the rate charge or sum due by him for the period of his occupancy"71. In relation to sewerage rates, an occupier could recover amounts paid "unless otherwise provided by lease or agreement"72, as cl 4 did. Land tax was levied on the total unimproved value of all land of which a person was the owner73. But s 42 of the Land Tax Act 1958 (Vic) deemed a lessee of land to be liable for land tax "as if owner", and to the exclusion of the legal owner, in circumstances where, in the opinion of the Commissioner, the interest of the legal owner "is lessened by the covenants of any lease", as, for example, might be said of a 99 year lease which expressly precludes a power of 67 Ecosse (2014) ANZ ConvR ¶14-020 at 871 [7]. 68 Local Government Act 1958 (Vic), s 267(1)(b). 69 Local Government Act 1958, s 342(1). 70 Melbourne and Metropolitan Board of Works Act 1958 (Vic), ss 98, 106, 176. 71 Melbourne and Metropolitan Board of Works Act, s 108. 72 Melbourne and Metropolitan Board of Works Act, s 177. 73 Land Tax Act 1958 (Vic), s 8(1). Nettle earlier determination and right of re-entry. In such circumstances, the Commissioner would determine the amount of land tax payable as between the lessee and the legal owner respectively. Accordingly, at the time the lease was entered into, the effect of cl 4 was to ensure that general rates, water and sewerage rates and land tax were payable by the Lessee, and that those amounts could not otherwise be recovered by the Lessee from the Lessor. There were documents before the primary judge and the Court of Appeal that recorded rates and taxes levied in respect of the leased land between 2005 and 2015. They showed a significant liability incurred by the Lessor. But, as the respondent submitted, and the majority in the Court of Appeal concluded, that was not the position when the lease was entered into in 198874. Nor was it a state of affairs that the contracting parties could have anticipated with any degree of precision. At the time of entry into the lease, the leased land was not zoned residential. It was only later when the appellant took steps to have the leased land rezoned to permit residential development, and did so despite the lease preventing development of the land by the Lessor (cl 14) and restricting the extent to which the land could be altered for the purpose of residential development (cl 7), that the tax burden was increased. The increases in rates and land tax from 2005 were a direct consequence of an increase in the land's value upon its rezoning. Certainly, as McLeish JA observed75, "[t]he incidence of statutory charges is notoriously liable to change over time". Legally represented parties may be taken to have known as much, especially in circumstances like these where the lease explicitly adverts to the changeability of other sorts of statutory obligations (cl 6). But it does not follow, on the construction for which the respondent contends, that the financial consequences of cl 4 would have appeared uncommercial or otherwise unreasonable at the time of entry into the lease76. The proper construction of cl 4 The striking out in cl 4 of the words "excepting land tax", "Landlord or" and "but a proportionate part to be adjusted between Landlord and Tenant if the case so requires" is significant. Given the ambiguity in cl 4, it aids in the construction of what remains77. 74 Gee Dee Nominees (2016) V ConvR ¶54-879 at 65,306 [107], 65,309 [128]-[129]. 75 Gee Dee Nominees (2016) V ConvR ¶54-879 at 65,309 [128]. 76 Gee Dee Nominees (2016) V ConvR ¶54-879 at 65,309 [127]-[128]. 77 Codelfa (1982) 149 CLR 337 at 352-353 per Mason J; Esso Australia Ltd v Australian Petroleum Agents' & Distributors' Association [1999] 3 VR 642 at (Footnote continues on next page) Nettle Before the words "excepting land tax" were deleted, their clear effect would have been to exclude land tax from the rates and taxes which the Lessee was liable to pay under cl 4. Hence, the Lessee would not have been liable to pay any land tax in respect of the leased land, whether assessed to the Lessor or at all. The natural and ordinary effect of deleting the words "excepting land tax" was to reverse the exclusion and so to subject the Lessee to a liability to pay such amount of land tax as might be assessed in respect of the leased land and levied upon the Lessee "as if owner"78. Before deletion of the words "Landlord or", the expression "rates taxes assessments and outgoings whatsoever which during the said term shall be payable by the Landlord or tenant" meant rates and taxes which during the said term the Landlord or the tenant becomes liable to pay. The natural and ordinary effect of deleting the words "Landlord or" was to limit the rates and taxes which the Lessee was liable to pay to those for which during the said term the tenant becomes liable. The probability that those two deletions were intended to have their plain and ordinary effect is fortified by the deletion from cl 4 of the express provision for apportionment appearing in parentheses. Since the Lessee was no longer required to pay a proportion of any rates and taxes that the Lessor might become liable to pay qua owner, but was required to pay all rates and taxes that the Lessee might become liable to pay qua tenant, there was no longer need for an apportionment provision. By contrast, if cl 4 had the meaning for which the appellant contends, the deletion of the apportionment provision would be nonsensical. It is not realistic to suppose that the Lessee would have agreed to pay rates and taxes in respect of the land on anything other than a single holding basis79. Given the possibility that, because of the Lessor's other landholdings, the rate of land taxes and other outgoings imposed in respect of the leased land might be assessed on a higher basis than that of a single holding, there would still have been a need for apportionment80. Counsel for the appellant argued that the kind of apportionment necessary to achieve that result was implicit in the lease by the use of the words "in respect 647-648 [19]; Goninan (2008) 15 ANZ Insurance Cases ¶61-779 at 76,945-76,946 [37]-[40] per Buss JA (Martin CJ and McLure JA agreeing at 76,935 [1], [2]). 78 Land Tax Act 1958, s 42. 79 See Tooth & Co Ltd v Newcastle Developments Ltd (1966) 116 CLR 167 at 170-171; [1966] HCA 57. 80 Cf Gee Dee Nominees (2016) V ConvR ¶54-879 at 65,308 [123]. Nettle of the said premises". But, even if that were so81, it is objectively not in the least likely that the parties considered it to be so clear as to make the express parenthetical apportionment provision excess to needs. On any view of the matter, the words "in respect of the said premises" could not be regarded as functioning as an implied apportionment provision unless the expression "which during the said term shall be payable by the tenant in respect of the said premises" were properly to be understood as continuing to operate as an adjectival clause descriptive of the rates and taxes which the Lessee is liable to pay. The appellant's construction of cl 4 requires the opposite. It necessitates acceptance of the proposition that, by reason of the deletion of the words "Landlord or" and the deletion of the express parenthetical apportionment provision, the expression "which during the said term shall be payable by the tenant in respect of the said premises" was transformed from an adjectival clause descriptive of the obligations which the Lessee was required to meet into a reiteration of the earlier imperative that "the Lessee ... will pay". The majority in the Court of Appeal were correct to reject82 the appellant's argument that the words "payable by the tenant" should be construed as a reiteration of the obligation to pay imposed on the Lessee by the previous imperative. Clause 4 is the only provision of the lease that uses the expression "the tenant" in contradistinction to "the Lessee". On the appellant's construction, that distinction is inexplicable. There is no point in changing from "the Lessee" to "the tenant" if the purpose of the phrase "payable by the tenant" is merely to repeat the obligation that "the Lessee ... will pay". By contrast, on the respondent's construction, the distinction is readily explicable. The phrase "payable by the tenant" delimits the kinds of rates and taxes to which the clause applies, namely, those for which the Lessee is liable qua tenant83. Further, given that the parties were legally represented in the preparation of the lease, the idea that "payable by the tenant" was meant to operate as a reiteration of the earlier obligation on the Lessee to pay presents as a remarkably inapt and improbable way for the drafters of the document to have gone about achieving the result contended for. Consequently, despite such other difficulties with the lease as there may be, the appellant's construction of cl 4 is improbable. By contrast, the natural and ordinary meaning of the adjectival clause "which during the said term shall be payable by the tenant in respect of the said premises" is so apt to limit the kind of rates and taxes which the Lessee is liable to pay to those rates and taxes in respect of the leased land that the Lessee is liable to pay qua tenant that it is most probably what was intended. 81 Tooth & Co (1966) 116 CLR 167 at 170-171. 82 Gee Dee Nominees (2016) V ConvR ¶54-879 at 65,305 [101], 65,308 [124]. 83 Gee Dee Nominees (2016) V ConvR ¶54-879 at 65,305-65,306 [102]. Nettle Moreover, as the majority in the Court of Appeal observed, if the parties' intention had been to produce the result for which the appellant contends, it is obvious, and it would have been obvious to the parties entering into the lease, that all that needed to be done was to delete the words "excepting land tax". There is no apparent explanation for why that was not done if the objective were as the appellant contends. The highest the appellant can put its case is that, in view of other unfortunate aspects of the document, and because of the need to construe the document as an honest and reasonable businessperson would do in light of what the appellant contends is the conveyance-like nature of the transaction described in cl 13, all other changes that were made to cl 4 should be treated as being, in effect, meaningless or explicable solely on the basis of inadvertent clumsiness on the part of the drafters. Commercial good sense Much of the appellant's argument before this Court focussed on the commercial consequences for the appellant of the construction of cl 4 adopted by the majority in the Court of Appeal. The thrust of those submissions was that the consequences would be so onerous that, judged according to the standards of an honest and reasonable businessperson, it cannot rationally be supposed that the parties intended to bring about that result. Given the idiosyncratic nature of the lease, the majority's hermeneutic analysis of the words of cl 4 was misplaced and would lead to a conclusion that flouts business commonsense. Commercial reality demanded a construction which yields to what business commonsense requires84. Those submissions are unpersuasive. It has not been established that the parties would necessarily, or even probably, have considered that the Lessor would be worse off by requiring the Lessee to pay all of the rates and taxes, including land tax, which the Lessee might become liable qua tenant to pay in respect of the leased land than by requiring the Lessee to pay a proportion of all rates and taxes, other than land tax, incurred in respect of the land, as the lease initially provided85. The position has changed since the lease was entered into. But that is because of subsequent developments brought about by the unilateral actions of the appellant, and, to some extent, by legislative amendments to the regimes imposing rates and taxes86. There is nothing to suggest that such 84 Antaios Compania Naviera SA v Salen Rederierna AB [1985] AC 191 at 201 per Lord Diplock (the other members of the House of Lords agreeing at 207-209). 85 See [84] above. 86 See Local Government Act 1989 (Vic), s 156; Land Tax Act 2005 (Vic), ss 8, 18, Nettle changes were foreseen at the time of entry into the lease. The appellant did not adduce any evidence directed to that point. Counsel for the appellant submitted that, whether or not changes of the kind that eventuated were foreseen, it is axiomatic that the mere possibility that such changes could occur over time would have been enough to cause a reasonable businessperson in the Lessor's position to insist upon the Lessee paying all rates and taxes levied in respect of the land, and, consequently, that it would be commercially unreal and unreasonable to interpret cl 4 as providing for anything else. That submission is also unpersuasive. It is not at all clear that a reasonable businessperson in the Lessor's position at the time of entry into the lease would have been so concerned about the prospect of future legislative amendments and tax increases as to insist upon a complete indemnity. Still less is it clear that a reasonable businessperson in the Lessee's position at the time of entry into the lease would have agreed to that open-ended liability; especially given that such increases could be brought about  as in fact has occurred  by the unilateral actions of the Lessor or a successor acquiring the leasehold reversion. For all one can say at this stage of remove from the entry into the lease, it would not have been commercially irrational for the Lessor to accept those uncertainties (particularly in light of its holding the reversion in the land) or for the Lessee to yield to the Lessor no more than a liability to pay rates and taxes, including land tax, payable by the Lessee qua tenant. Finally, it is to be observed that, even if the resultant lease were considered to be a remarkably poor deal from the Lessor's point of view (and, to repeat, it is not obvious that it should be so regarded), the precept that commercial contracts be construed as it is thought an honest and reasonable businessperson would construe them will stretch only so far. As Lord Mustill observed in Charter Reinsurance Co Ltd v Fagan87: "There comes a point at which the court should remind itself that the task is to discover what the parties meant from what they have said, and that to force upon the words a meaning which they cannot fairly bear is to substitute for the bargain actually made one which the court believes could better have been made. This is an illegitimate role for a court." 87 [1997] AC 313 at 388 (Lord Goff of Chieveley, Lord Griffiths and Lord Browne-Wilkinson agreeing at 381). Nettle Poor drafting may justify a court in being more ready to depart from the natural and ordinary meaning of the terms of a contract88, and no doubt, the poorer the drafting, the less willing a court should be to be "driven by semantic niceties to attribute to the parties an improbable and unbusinesslike intention"89. But poor drafting provides "no reason to depart from the fundamental rule of construction of contractual documents that the intention of the parties must be ascertained from the language they have used interpreted in the light of the relevant factual situation in which the contract was made"90. Where there is ambiguity which permits of two alternative and semantically not improbable interpretations, construction in accordance with what it may be supposed would be the approach of honest and reasonable businesspersons may assist in choosing one such alternative over the other. But where, as here, the language and surrounding circumstances of a commercial contract present a choice between, on the one hand, a plain, ordinary and commercially not irrational meaning of a clause and, on the other, a meaning which is significantly removed from the natural and ordinary meaning of the terms of the clause, which ill-accords with other provisions of the agreement, and which in the end produces an outcome that is more commercially acceptable from one of the parties' point of view only, the precept runs out of application. Unless the Anglo-Australian objective theory of contract is now to be cast aside, the commercial approach to construction91 is not a licence to alter the meaning of a term that is "clear and fairly susceptible of one meaning only" to achieve a result that the court may think to be reasonable92. 88 Arnold v Britton [2015] AC 1619 at 1628 [18] per Lord Neuberger of Abbotsbury PSC, with whom Lord Sumption and Lord Hughes JJSC agreed (Lord Hodge JSC agreeing at 1637 [66]). 89 Mitsui Construction Co Ltd v Attorney General of Hong Kong (1986) 33 BLR 1 at 14, cited with approval in Gan Insurance Co Ltd v Tai Ping Insurance Co Ltd (No 2) [2001] 2 All ER (Comm) 299 at 306 [13] per Mance LJ. 90 Mitsui Construction (1986) 33 BLR 1 at 14. See also Rainy Sky SA v Kookmin Bank [2011] 1 WLR 2900 at 2910 [26] per Lord Clarke of Stone-cum-Ebony JSC, with whom Lord Phillips of Worth Matravers PSC, Lord Mance, Lord Kerr of Tonaghmore and Lord Wilson JJSC agreed; [2012] 1 All ER 1137 at 1147-1148. 91 Cohen & Co v Ockerby & Co Ltd (1917) 24 CLR 288 at 300 per Isaacs J; [1917] HCA 58; Upper Hunter County District Council v Australian Chilling and Freezing Co Ltd (1968) 118 CLR 429 at 437 per Barwick CJ; [1968] HCA 8. Cf Mannai Investment Co Ltd v Eagle Star Life Assurance Co Ltd [1997] AC 749 at 770-771 per Lord Steyn; Society of Lloyd's v Robinson [1999] 1 WLR 756 at 763 per Lord Steyn (the other Law Lords agreeing at 758, 767-768). 92 Photo Production Ltd v Securicor Transport Ltd [1980] AC 827 at 851 per Lord Diplock. See also Arnold v Britton [2015] AC 1619 at 1628 [18] per (Footnote continues on next page) Nettle The court is not authorised under the guise of construction to make a new contract for the parties at odds with the contract to which they have agreed93. Where, as here, all things considered, the words of a clause are fairly susceptible of only one meaning, they must be given that effect. Conclusion and orders In the result, the appeal should be dismissed with costs. Lord Neuberger PSC, with whom Lord Sumption and Lord Hughes JJSC agreed (Lord Hodge JSC agreeing at 1637 [66]). 93 Johnson v American Home Assurance Co (1998) 192 CLR 266 at 272 [19] per Kirby J; [1998] HCA 14; Charter Reinsurance [1997] AC 313 at 388 per Lord Mustill (Lords Goff, Griffiths and Browne-Wilkinson agreeing at 381).

HIGH COURT OF AUSTRALIA WELLS FARGO TRUST COMPANY, NATIONAL ASSOCIATION (AS OWNER TRUSTEE) & ANOR APPELLANTS AND VB LEASECO PTY LTD (ADMINISTRATORS APPOINTED) & ORS RESPONDENTS Wells Fargo Trust Company, National Association (as owner trustee) v VB Leaseco Pty Ltd (administrators appointed) [2022] HCA 8 Date of Hearing: 4 November 2021 Date of Judgment: 16 March 2022 ORDER Order 3 of the orders of the Full Court of the Federal Court of Australia made on 7 October 2020 be set aside and, in its place, it be ordered that: "the respondents pay the appellants' costs of the proceedings before the primary judge as agreed or assessed". Appeal otherwise dismissed. The appellants pay the respondents' costs of the appeal. The amount of $500,352.99, paid into the Federal Court of Australia by the appellants pursuant to the orders of the Federal Court of Australia made on 10 November 2020, be released to the respondents. On appeal from the Federal Court of Australia Representation B W Walker SC with P F Santucci for the appellants (instructed by Norton Rose Fulbright Australia) J T Gleeson SC with K I H Lindeman for the respondents (instructed by Clayton Utz) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Wells Fargo Trust Company, National Association (as owner trustee) v VB Leaseco Pty Ltd (administrators appointed) Aviation – Aircraft leasing – Where first appellant leased aircraft engines to lessee company – Where administrators appointed to lessee company – Where lease agreements specified obligations for redelivery of aircraft engines – Where Protocol to Convention on International Interests in Mobile Equipment on Matters Specific to Aircraft Equipment ("Protocol") required administrators to "give possession" of aircraft engines upon insolvency-related event – Where specific redelivery obligations under lease agreements preserved by Convention on International Interests in Mobile Equipment but constrained by s 440B of Corporations Act 2001 (Cth) – Whether obligation to give possession under Art XI(2) of Protocol fulfilled by administrators providing opportunity to take possession of aircraft engines in Australia – Meaning of "give possession" in Art XI(2) of Protocol. Words and phrases – "aircraft engines", "aircraft objects", "give possession", "insolvency-related event", "lease agreements", "obligation to give possession", "opportunity to take control", "provide an opportunity for the exercise of the right to take possession", "right to take possession", "rules of insolvency procedure". Corporations Act 2001 (Cth), s 440B. International Interests in Mobile Equipment (Cape Town Convention) Act 2013 (Cth). KIEFEL CJ, GAGELER, KEANE, EDELMAN AND STEWARD JJ. The International Interests in Mobile Equipment (Cape Town Convention) Act 2013 (Cth) ("the Act") enacts that the Convention on International Interests in Mobile Equipment1 ("the Convention") and the Protocol to the Convention on International Interests in Mobile Equipment on Matters Specific to Aircraft Equipment2 ("the Protocol"), so far as they relate to Australia, have the force of law as part of the law of the Commonwealth3. The Convention and the Protocol as so in force must be construed according to the principles applicable to the interpretation of treaties in international law4. The Act goes on to enact that the Convention and the Protocol as so in force prevail to the extent of any inconsistency over any law of a State or Territory and any other law of the Commonwealth5, including relevantly the Corporations Act 2001 (Cth). The Act confers jurisdiction on the Federal Court of Australia and the Supreme Courts of the States and Territories in matters arising under the Act6. This appeal, from a decision of the Full Court of the Federal Court of Australia7 in a matter arising under the Act, turns on the content of the obligation imposed by Art XI(2) of the Protocol on VB Leaseco Pty Ltd ("Leaseco") and its administrators ("the Administrators") to "give possession" of certain aircraft engines to Wells Fargo Trust Company ("Wells Fargo") within 60 days of the occurrence of an "insolvency-related event" constituted by the appointment of the Administrators under Pt 5.3A of the Corporations Act. Was the obligation to redeliver the aircraft engines to Wells Fargo in the United States? Or was the 1 Convention on International Interests in Mobile Equipment (2001) as amended and in force for Australia from time to time. Protocol to the Convention on International Interests in Mobile Equipment on Matters Specific to Aircraft Equipment (2001) as amended and in force for Australia from time to time. Section 7 of the Act. 4 Addy v Federal Commissioner of Taxation (2021) 95 ALJR 911 at 917-918 [23]; 394 ALR 214 at 221-222. Section 8 of the Act. Section 9 of the Act. 7 VB Leaseco Pty Ltd v Wells Fargo Trust Company (2020) 279 FCR 518. obligation no more than to provide Wells Fargo with an opportunity to take control of the aircraft engines in Australia? For reasons to be explained, the obligation of Leaseco and the Administrators was no more than to provide Wells Fargo with an opportunity to take control of the aircraft engines in Australia. The Full Court was correct to so conclude. Facts and procedural history Leaseco, part of the Virgin Australia group, leased the aircraft engines from Wells Fargo, their legal owner. The beneficial owner of the aircraft engines was Willis Lease Finance Corporation ("Willis"). Each agreement for lease provided for the leased aircraft engine to be redelivered by Leaseco to Wells Fargo at a location in Florida to be specified by Wells Fargo upon the expiration or other termination of the lease. Each agreement incorporated terms and conditions set out in a General Terms Engine Lease Agreement ("GTA"). The GTA set out terms which provided for the redelivery of the aircraft engines upon the termination of the lease to the location in Florida specified pursuant to each agreement to be free of all liens and accompanied by specified technical records. The GTA set out an elaborate and prescriptive regime governing the method of redelivery. The GTA also specified events of default, which included the appointment of an administrator, and set out the rights of Wells Fargo on the occurrence of an event of default. The rights of Wells Fargo on the occurrence of an event of default were expressed to include rights to do all or any of the following: to "cancel [Leaseco's] rights of possession and use under any and all [l]eases"; to "terminate [Wells Fargo's] obligations to lease any [aircraft engines] to [Leaseco]"; to demand that Leaseco redeliver any aircraft engine as if on the expiration of the lease or, in the alternative at the option of Wells Fargo, to enter on premises where the aircraft engine was located "and take immediate possession of and remove the same". Following the appointment of the Administrators on 20 April 2020, Willis on 16 June 2020 made a demand for redelivery of the aircraft engines to a specified location in Florida pursuant to the lease agreements, which the Administrators rejected. The Administrators on the same day proffered to Willis an opportunity to take control of the aircraft engines where the aircraft engines happened then to be located in Australia, which was rejected. On 30 June 2020, Wells Fargo and Willis commenced a proceeding in the Federal Court for declarations and other orders against, among others, Leaseco and the Administrators. The proceeding was heard by Middleton J on 17 August 2020. On 3 September 2020, his Honour delivered reasons and made orders the effect of which was to compel Leaseco and the Administrators to redeliver the aircraft engines to the specified location in Florida substantially in accordance with the regime governing the method of redelivery set out in the GTA8. Three weeks later, the Full Court constituted by McKerracher, O'Callaghan and Colvin JJ heard an appeal from the orders of Middleton J. The Full Court rendered its decision allowing the appeal on 7 October 2020. Special leave to appeal to this Court was granted on 12 April 2021. The aircraft engines having been returned in the meantime to the United States, the urgency that had existed in the Federal Court no longer existed in this Court. Underlying the question in the appeal is a question as to the construction of the obligation to "give possession" imposed by Art XI(2) of the Protocol. That underlying question is of general importance within the aviation industry. The immediate practical significance of answering the question in the appeal lies in the bearing the answer will have on the determination of whether the expenses incurred in returning the aircraft engines to the United States are to be borne by Wells Fargo or by the general body of creditors of Leaseco. The Convention The Convention establishes a legal framework for the asset-based financing and leasing of mobile equipment that is of high value or particular economic significance. The Convention does so by providing for the creation and registration of "international interests" to be recognised by "Contracting States" in uniquely identifiable objects within three categories: "airframes, aircraft engines and helicopters", "railway rolling stock" and "space assets"9. 8 Wells Fargo Trust Company, National Association (trustee) v VB Leaseco Pty Ltd (administrators appointed) [2020] FCA 1269. 9 Article 2(3) of the Convention. The Protocol is a protocol to the Convention applicable to uniquely identifiable objects within the first of those three categories, "airframes, aircraft engines and helicopters". The Protocol refers to them as "aircraft objects"10. The rules of construction set out in the Convention and the Protocol provide that the Convention and the Protocol are to be read together as a single instrument11, to be known as "the Convention on International Interests in Mobile Equipment as applied to aircraft objects"12, and that the Protocol is to prevail to the extent of any inconsistency with the Convention13. To ascertain the content of the obligation to "give possession" imposed by Art XI(2) of the Protocol, it is necessary to examine the combined operation of the Convention and the Protocol. To understand how those two instruments operate together, it is instructive first to consider the generic operation of the Convention, and then to note specific modifications introduced by the Protocol. Conformably with the applicable principles of interpretation14, both the generic operation of the Convention and the specific modifications introduced by the Protocol are best understood by having regard to the Official Commentary on the Convention and the Protocol prepared by Professor Sir Roy Goode and approved for distribution by the Governing Council of the International Institute for the Unification of Private Law ("the Official Commentary")15. Foundational to the generic operation of the Convention is the constitution of an "international interest". If created or provided for by an agreement meeting 10 Article I(2)(c) of the Protocol. 11 Article 6(1) of the Convention. 12 Article II(2) of the Protocol. 13 Article 6(2) of the Convention. 14 See Art 31 of the Vienna Convention on the Law of Treaties (1969). 15 Goode, Convention on International Interests in Mobile Equipment and Protocol Thereto on Matters Specific to Aircraft Equipment, Official Commentary, 4th ed (2019), as approved for distribution by the UNIDROIT Governing Council pursuant to Resolution No 5 adopted by the Cape Town Diplomatic Conference. certain formal requirements16, any of three types of interest will be constituted as an international interest17. The first is an interest granted by the chargor under a "security agreement"18, defined as "an agreement by which a chargor grants or agrees to grant to a chargee an interest (including an ownership interest) in or over an object to secure the performance of any existing or future obligation of the chargor or a third person"19. The second is an interest vested in the conditional seller under a "title reservation agreement"20, defined as "an agreement for the sale of an object on terms that ownership does not pass until fulfilment of the condition or conditions stated in the agreement"21. The third – that applicable here – is an interest vested in the lessor under a "leasing agreement"22, defined as "an agreement by which ... the lessor ... grants a right to possession or control of an object ... to ... the lessee ... in return for a rental or other payment"23. The Official Commentary explains the meaning of the word "possession" in that definition, and by implication elsewhere in the Convention and the Protocol, as follows24: "The word 'possession' (in the French text, possession) must here be given a broad meaning. In civil law systems, for example, the concept of possession requires a combination of factual possession of an object and an 16 Article 7 of the Convention. 17 Article 2(2) of the Convention. 18 Article 2(2)(a) of the Convention. 19 Article 1(ii) of the Convention. 20 Article 2(2)(b) of the Convention. 21 Article 1(ll) of the Convention. 22 Article 2(2)(c) of the Convention. 23 Article 1(q) of the Convention. 24 Official Commentary at 27 [2.30]. intention to hold it as owner, so that an equipment lessee is not a possessor but a 'detainer' (détenteur) whose rights are in essence contractual rather than proprietary. But both have rights that can be asserted against third parties other than those with a better right. The word 'possession' is therefore to be construed as covering both possession in the common law sense and détention in the civil law sense". Within the meaning of the Convention – and within the meaning of the Protocol – each of a chargee under a security agreement, a conditional seller under a title reservation agreement and a lessor under a leasing agreement is a "creditor"25. Correspondingly, each of a chargor under a security agreement, a conditional buyer under a title reservation agreement and a lessee under a leasing agreement is a "debtor"26. Chapter III of the Convention is concerned with the remedies available to a creditor in the event of "default", being the occurrence of an event that the creditor and the debtor have agreed to constitute a default27 or (in the absence of agreement as to what will constitute a default) a default which substantially deprives the creditor of what the creditor is entitled to expect under the agreement28. Article 8 makes elaborate provision for the remedies of a chargee under a security agreement. Article 10 makes somewhat sparser provision for the remedies of a conditional seller under a title reservation agreement or a lessor under a leasing agreement. By operation of Art 8(1), a chargee under a security agreement can exercise one or more of a range of specified remedies, one of which is to "take possession or control of any object charged to it". Alternatively, by operation of Art 8(2), the chargee may apply for a court order authorising or directing any of the acts referred to in Art 8(1). Article 8(3) provides that a remedy specified in Art 8(1) "shall be exercised in a commercially reasonable manner", adding that "[a] remedy shall be deemed to be exercised in a commercially reasonable manner where it is exercised 25 Article 1(i) of the Convention. 26 Article 1(j) of the Convention. 27 Article 11(1) of the Convention. 28 Article 11(2) of the Convention. in conformity with a provision of the security agreement except where such a provision is manifestly unreasonable". By operation of Art 10, a conditional seller under a title reservation agreement or a lessor under a leasing agreement can "terminate the agreement and take possession or control of any object to which the agreement relates"29 or "apply for a court order authorising or directing either of these acts"30. The Official Commentary explains that "[w]hether the agreement must be expressly terminated before possession is taken or whether ... the act of taking possession is to be regarded as an implied termination of the agreement are matters to be determined by the applicable law and the terms of the agreement"31. In contrast to Art 8, Art 10 contains nothing to require a remedy for which it provides to be exercised by the seller or lessor in a commercially reasonable manner. Article 12 is headed "Additional remedies". The relevant effect of Art 12 is to spell out that (subject to a requirement for consistency with specified "mandatory provisions"32) a creditor is not prevented from exercising such other remedies as are available to it under the "applicable law", meaning the domestic rules of the law applicable by virtue of the rules of private international law of the forum State33, including remedies agreed between the parties. The Official Commentary explains that "[i]t is therefore open to the parties to agree on cumulation of Convention remedies and those additional remedies provided or permitted by the applicable law"34. Though Art 12 permits additional remedies agreed between the creditor and the debtor, it affords those remedies no enhanced status. Chapter V of the Convention makes extensive provision for the registration of an international interest in an International Registry established under the 29 Article 10(a) of the Convention. 30 Article 10(b) of the Convention. 31 Official Commentary at 79 [2.121]. 32 See Art 15 of the Convention. 33 See Art 5(3) of the Convention. 34 Official Commentary at 80 [2.123]. Convention. Suffice it for present purposes to note that an international interest can be registered, so as to become a "registered interest"35, by either a creditor or a debtor with the consent of the other36. Chapter VIII of the Convention, comprising Arts 29 and 30, addresses the effects of an international interest as against third parties. By operation of Art 29, a registered interest has priority over a subsequently registered interest and also over an unregistered interest37, except for a "non-consensual interest"38 created by operation of law that is permitted to have priority without registration pursuant to a declaration of a Contracting State pursuant to Art 39(1). Pursuant to Art 39(1)(a), Australia has made such a declaration in respect of statutory liens registered in accordance with the Air Services Act 1995 (Cth)39. if registered prior By operation of Art 30(1), an international interest is effective in "insolvency proceedings against the the debtor" commencement of the insolvency proceedings. "[I]nsolvency proceedings" are defined to include any "collective judicial or administrative proceedings, including interim proceedings, in which the assets and affairs of the debtor are subject to control or supervision by a court for the purposes of reorganisation or liquidation"40. "Insolvency administrator" correspondingly means "a person authorised to administer the reorganisation or liquidation, including one authorised on an interim basis, and includes a debtor in possession if permitted by the applicable insolvency law"41. For the purposes of the Convention – and correspondingly for the purposes of the Protocol – "insolvency proceedings" accordingly include administration under Pt 5.3A of the Corporations Act, which 35 Article 1(cc) of the Convention. 36 Article 20(1) of the Convention. 37 Article 29(1) of the Convention. 38 Article 1(s) of the Convention. 39 Australia, Declaration Deposited Under the Cape Town Convention on International Interests in Mobile Equipment Relating to Article 39(1) (2015). 40 Article 1(l) of the Convention. 41 Article 1(k) of the Convention. commences with the appointment of an administrator who is then an "insolvency administrator". Article 30(3)(b) then introduces an important qualification to the operation of Art 30(1) by providing that nothing in Art 30 affects "any rules of procedure relating to the enforcement of rights to property which is under the control or supervision of the insolvency administrator". The purpose and effect of Art 30(3)(b), in the language of the Official Commentary, is to preserve "rules of insolvency procedure designed to limit the enforcement of security or other property rights in the interests of the general body of creditors, for example, by imposing an automatic stay on the enforcement of security and other in rem rights in order to facilitate a reorganisation"42. The rules of procedure relating to the enforcement of rights to property preserved by Art 30(3)(b) of the Convention in relation to international interests registered before the appointment of an administrator include the restrictions imposed by s 440B of the Corporations Act on the exercise of rights that a third party has in property of, or in the possession of, a debtor in administration under Pt 5.3A of the Corporations Act. Relevant to the particular position of Wells Fargo as lessor of the aircraft engines in the possession of Leaseco at the time of the appointment of the Administrators are the restrictions set out in Item 3(b) of the table in s 440B of the Corporations Act, which operate to prevent a lessor from exercising any right to "take possession of" or "otherwise recover" leased property without the consent of the administrator or the leave of the court. The Protocol The Protocol modifies the generic operation of the Convention in respect of international interests in aircraft objects against the background of provisions of the Convention on International Civil Aviation (commonly known as the Chicago Convention)43 which establish rules governing "aircraft", being either helicopters or airframes with aircraft engines installed44. Those modifications include 42 Official Commentary at 396 [4.220]. 43 Convention on International Civil Aviation (1944). 44 Article I(2)(a) of the Protocol. requiring their registration on a register maintained by a "registry authority"45 in a Contracting State. The Protocol contains two provisions which modify the generic operation of the Convention in ways that bear on the question in the appeal. The first provision is Art IX. Headed "Modification of default remedies provisions", Art IX provides in relevant part: In addition to the remedies specified in Chapter III of the Convention, the creditor may, to the extent that the debtor has at any time so agreed and in the circumstances specified in that Chapter: procure the de-registration of the aircraft; and procure the export and physical transfer of the aircraft object from the territory in which it is situated. The creditor shall not exercise the remedies specified in the preceding paragraph without the prior consent in writing of the holder of any registered interest ranking in priority to that of the creditor. Article 8(3) of the Convention shall not apply to aircraft objects. Any remedy given by the Convention in relation to an aircraft object shall be exercised in a commercially reasonable manner. A remedy shall be deemed to be exercised in a commercially reasonable manner where it is exercised in conformity with a provision of the agreement except where such a provision is manifestly unreasonable. The registry authority in a Contracting State shall, subject to any applicable safety laws and regulations, honour a request for de- registration and export if: the request is properly submitted by the authorised party under a recorded irrevocable deregistration and export request authorisation; and 45 Article I(2)(o) of the Protocol. the authorised party certifies to the registry authority, if required by that authority, that all registered interests ranking in priority to that of the creditor in whose favour the authorisation has been issued have been discharged or that the holders of such interests have consented to the de-registration and export. Article IX modifies the remedies available to a creditor under Arts 8 and 10 of the Convention in the event of default in two uncontroversial respects. The first modification is, by Art IX(1), to provide to the creditor (whether a chargee, conditional seller or lessor) additional Convention remedies to the extent at any time agreed to by the debtor (whether a chargor, conditional buyer or leesee). The additional remedies are: to procure de-registration of the aircraft with the co- operation of the registry authority of the Contracting State under Art IX(5); to procure export of the aircraft object with the co-operation of the registry authority of the Contracting State under Art IX(5); and to procure physical transfer of the aircraft object from the territory in which it is situated. The other modification is, by Art IX(3), to subject all of the Convention remedies available to the creditor in relation to an aircraft object to the requirement that the remedy be exercised in a commercially reasonable manner. Whilst Art IV(3) of the Protocol permits the debtor and creditor by agreement to derogate from or vary the effect of other provisions of the Protocol, it specifically prevents them derogating from or varying the effect of Art IX(3). The provision of the Protocol central to the appeal is Art XI, which is headed "Remedies on insolvency". Where, pursuant to Art 30(1) of the Convention, an international interest is effective in insolvency proceedings against a debtor, to the extent that Art XI is applicable, Art XI operates to displace the operation of Art 30(3)(b). Article XI is expressed to apply only where a Contracting State that is the "primary Art XXX(3)47. The "primary insolvency jurisdiction" encompasses the place of jurisdiction"46 has made a declaration pursuant insolvency 46 Article I(2)(n) of the Protocol. 47 Article XI(1) of the Protocol. incorporation of the debtor in respect of which there has occurred an "insolvency- related event"48, here, the commencement of insolvency proceedings. Article XXX(3) allows for a choice between two alternative versions of Art XI. Australia has chosen Alternative A49. Alternative A is expressed in the following terms: "2. Upon the occurrence of an insolvency-related event, the insolvency administrator or the debtor, as applicable, shall, subject to paragraph 7, give possession of the aircraft object to the creditor no later than the earlier of: the end of the waiting period; and the date on which the creditor would be entitled to possession of the aircraft object if this Article did not apply. For the purposes of this Article, the 'waiting period' shall be the period specified in a declaration of the Contracting State which is the primary insolvency jurisdiction. References in this Article to the 'insolvency administrator' shall be to that person in its official, not in its personal, capacity. Unless and until the creditor is given the opportunity to take possession under paragraph 2: the insolvency administrator or the debtor, as applicable, shall preserve the aircraft object and maintain it and its value in accordance with the agreement; and the creditor shall be entitled to apply for any other forms of interim relief available under the applicable law. 48 Article I(2)(m)(i) of the Protocol. 49 Australia, Declaration Deposited Under the Protocol to the Convention on International Interests in Mobile Equipment on Matters Specific to Aircraft Equipment Regarding Article XXX(3) (2015). Sub-paragraph (a) of the preceding paragraph shall not preclude the use of the aircraft object under arrangements designed to preserve the aircraft object and maintain it and its value. The insolvency administrator or the debtor, as applicable, may retain possession of the aircraft object where, by the time specified in paragraph 2, it has cured all defaults other than a default constituted by the opening of insolvency proceedings and has agreed to perform all future obligations under the agreement. A second waiting period shall not apply in respect of a default in the performance of such future obligations. 8. With regard to the remedies in Article IX(1): they shall be made available by the registry authority and the administrative authorities in a Contracting State, as applicable, no later than five working days after the date on which the creditor notifies such authorities that it is entitled to procure those remedies in accordance with the Convention; and the applicable authorities shall expeditiously co-operate with and assist the creditor in the exercise of such remedies in conformity with the applicable aviation safety laws and regulations. No exercise of remedies permitted by the Convention or this Protocol may be prevented or delayed after the date specified in paragraph 2. 10. No obligations of the debtor under the agreement may be modified without the consent of the creditor. 11. Nothing in the preceding paragraph shall be construed to affect the authority, if any, of the insolvency administrator under the applicable law to terminate the agreement. 12. No rights or interests, except for non-consensual rights or interests of a category covered by a declaration pursuant to Article 39(1), shall have priority in insolvency proceedings over registered interests. The Convention as modified by Article IX of this Protocol shall apply to the exercise of any remedies under this Article." Pursuant to Art XI(3), Australia has declared the "waiting period" for the purposes of Art XI(2)(a) to be the period of 60 days50. Implicit in Art XI(2)(b), and in the structure of Alternative A as a whole, is the assumption that the rules of insolvency procedure preserved by Art 30(3)(b) of the Convention will have resulted in an automatic stay of the enforcement of such right to possession as the creditor would be able to exercise under Art 8 or Art 10 of the Convention or under domestic law (including under an agreement between the creditor and the debtor) as preserved by Art 12 of the Convention. The Official Commentary explains51: "The underlying premise is that the commencement of the insolvency proceedings produces a stay on the creditor's right to possession. Where this is not the case or where any stay has been lifted the creditor becomes entitled to possession even if the waiting period has not expired. In other words, paragraph 2(b) is to be interpreted as if it read 'would be entitled, or becomes entitled, to possession of the aircraft object notwithstanding the insolvency proceedings or other insolvency-related event'." Unless the stay of enforcement imposed under the applicable rules of insolvency procedure is lifted so as to engage Art XI(2)(b), Art XI(2) operates to oblige the debtor or insolvency administrator (as applicable in the particular insolvency proceedings) to "give possession" of the aircraft object to the creditor no later than the end of the waiting period of 60 days from the insolvency-related event. In the meantime, Art XI(5)(a) operates to oblige the debtor or insolvency administrator to preserve and maintain the aircraft object and its value in accordance with the underlying agreement between the creditor and the debtor, and Art XI(6) operates to ensure that the debtor or insolvency administrator is not precluded from using the aircraft object under arrangements designed to preserve and maintain it and its value. If, by the end of the 60-day waiting period, the debtor 50 Australia, Declaration Deposited Under the Protocol to the Convention on International Interests in Mobile Equipment on Matters Specific to Aircraft Equipment Regarding Article XXX(3) (2015). 51 Official Commentary at 516 [5.64]. or insolvency administrator has cured all defaults (other than a default constituted by the opening of insolvency proceedings which is incurable) and has agreed to perform all future obligations under the agreement, Art XI(7) permits the debtor or insolvency administrator to retain possession of the aircraft object. Through the combination of Art XI(6) and Art XI(7), the debtor or insolvency administrator is therefore able to avail itself of a one-off 60-day opportunity, from the commencement of the insolvency proceedings until the end of the waiting period, to use the aircraft object to attempt to trade out of default. If the debtor or insolvency administrator is unwilling or unable to avail itself of that opportunity, then the debtor or insolvency administrator must perform the obligation imposed by Art XI(2) no later than the end of the 60-day period. The content of the obligation imposed by Art XI(2) of the Protocol That brings us to the content of the obligation imposed on the debtor or insolvency administrator by Art XI(2) of the Protocol to "give possession" of the aircraft object to the creditor. Wells Fargo argues that the obligation is to deliver (in the case of a debtor who is a chargor) or redeliver (in the case of a debtor who is a conditional buyer or a lessee) the aircraft object to the creditor in compliance with the agreement between the debtor and the creditor. The argument is that the need to deliver or redeliver the aircraft object in compliance with the agreement either is inherent in the requirement to "give possession" to which Art XI(2) refers or arises in the performance of that obligation as an aspect of the requirement of Art IX(3) that "[a]ny remedy given by the Convention ... shall be exercised in a commercially reasonable manner". The argument cannot be accepted. Unlike Art IX(1) of the Protocol, Art XI(2) of the Protocol does not in form or in substance give an additional remedy to the creditor. Neither Art XI(9) nor Art XI(13) of the Protocol suggests to the contrary. And although Art X(6) of the Protocol refers to "the remedies in Article IX(1)", the Official Commentary notes that this is a "drafting slip" and that the reference should be to Art 13 of the Convention52. The requirement of Art IX(3) of the Protocol therefore has no application to the performance of the obligation that Art XI(2) imposes on the debtor or insolvency administrator. 52 Official Commentary at 506 [5.49]. The content of the obligation imposed by Art XI(2) needs to be understood in the context that Art XI of the Protocol is framed to apply in circumstances where the creditor has a right to take possession of the aircraft object under Art 8 or Art 10 of the Convention by reason of the occurrence of an event of default and where the enforcement of that right is restricted by reason of the commencement of insolvency proceedings through the operation of rules of insolvency procedure preserved by Art 30(3)(b) of the Convention. What Art XI(2) of the Protocol does in those circumstances is to impose an obligation on the debtor or insolvency administrator, performance of which can be delayed during the waiting period of 60 days when the debtor or insolvency administrator is permitted by Art XI(6) to use the aircraft object. If and when performed, performance of the obligation to "give possession" triggers an ability on the part of the creditor to exercise the right to take possession that the creditor has under Art 8 or Art 10 of the Convention notwithstanding the rules of insolvency procedure preserved by Art 30(3)(b) of the Convention. The operation of Art 30(3)(b) of the Convention is overridden to that limited extent. Article XI(13) of the Protocol then ensures that the Convention as modified by Art IX of the Protocol applies to the exercise by the creditor of the Convention right to take possession. In particular, it ensures that the requirement of commercial reasonableness referred to in Art IX(3) of the Protocol applies to the exercise of the Convention right to take possession. There is no reason to attribute to the term "possession" in Art XI(2) of the Protocol anything other than the constant meaning that the term has in Art XI(5) and Art XI(7) of the Protocol, in Art 8 and Art 10 of the Convention and elsewhere in the Convention and the Protocol. Throughout the Convention and the Protocol, the reference to "possession" is to physical control to the exclusion of others. For the debtor or insolvency administrator to "give possession" to the creditor within the meaning of Art XI(2) of the Protocol is for the creditor to be "given the opportunity to take possession" within the meaning of Art XI(5) of the Protocol: it is for the debtor or insolvency administrator to take whatever steps may be necessary to provide an opportunity for the exercise of the right to take possession which the creditor has under Art 8 or Art 10 of the Convention. If the creditor then chooses to take up the opportunity to exercise that right to take possession, the rules of insolvency procedure preserved by Art 30(3)(b) of the Convention will not stand in the way. Having taken possession of the aircraft object in the exercise of such right as the creditor has to take possession, the creditor is then in a position to exercise further rights under Art IX(1) of the Protocol to procure the de-registration of the aircraft and the export and physical transfer of the aircraft object. Article IX(5) of the Protocol contemplates that the creditor, in exercising those further rights, may take steps to procure the physical transfer of the aircraft object from the territory in which it is situated. And Art XI(8) of the Protocol obliges the Contracting State where the aircraft object is located to "expeditiously co-operate with and assist" the creditor in this regard. The strength of the argument on behalf of Wells Fargo lies in the notion that the expression "give possession" in Art XI(2) of the Protocol, considered in isolation, might be thought to comprehend the burden of the effort and expense necessary to return the aircraft object to the physical possession of the creditor at a nominated location. But as Arts IX(1), IX(5) and XI(8) make plain, under the Protocol the physical transfer of the aircraft object from the territory of a Contracting State where it might happen to be located is something quite different from giving or taking possession. It is the creditor who is to undertake, and be responsible for, the burden of the effort and expense of the physical transfer of aircraft objects from the Contracting State to the location nominated by the creditor. This aspect of the context in which Art XI(2) of the Protocol operates tends distinctly against Wells Fargo's argument that this burden is necessarily part of "giving possession". Telling strongly against Wells Fargo's argument is also that no right to procure the expeditious de-registration of the aircraft or the export and physical transfer of the aircraft object is available to the debtor or the insolvency administrator during the waiting period of 60 days from the insolvency-related event or at all. For Art XI(2) to impose an obligation to deliver or redeliver the aircraft object to the creditor by the end of the waiting period would effectively negate the opportunity afforded to the debtor or insolvency administrator by Art XI(6) and Art XI(7) to use the aircraft object to attempt to trade out of default during that same period. To construe the obligation imposed by Art XI(2) of the Protocol as being to facilitate the exercise of the creditor's right to take possession under Art 8 or Art 10 of the Convention aligns the operation of Art XI(2) with the operation of the provision of the United States Bankruptcy Code53 on which Alternative A of Art XI 53 11 USC §1110. of the Protocol was substantially based54. The obligation imposed by that provision to "surrender and return"55 equipment to a secured party, lessor or conditional vendor has been construed to mean no more than that "you get [the equipment] immediately and you get it as is, where it is"56. To so construe the obligation also attributes to Art XI(2) of the Protocol an operation consistent with the "underlying purpose" of Art XI as identified in the Official Commentary57, being "to reflect the realities of modern structured finance, in particular to facilitate capital market financing, by ensuring as far as possible that, within a specified and binding time-limit, the creditor either (a) secures recovery of the object or (b) obtains from the debtor or the insolvency administrator, as the case may be, the curing of all past defaults and a commitment to perform the debtor’s future obligations". Application Applying that construction of the obligation imposed by Art XI(2) of the Protocol, the position of Wells Fargo under the Convention as modified by the Protocol and in force under the Act can be summarised as follows. On the appointment of the Administrators, Wells Fargo had a right under Art 10 of the Convention to take possession or control of the aircraft engines and had rights under the GTA preserved by Art 12 of the Convention which included to demand redelivery of the aircraft engines as if on the expiration of the leases. Without the consent of the Administrators or the leave of the court, Wells Fargo was constrained by the operation of s 440B of the Corporations Act as preserved by Art 30(3)(b) of the Convention from exercising any of those rights. The Administrators' invitation to Willis, and in effect to Wells Fargo, to take control of the aircraft engines where they were situated in Australia fulfilled the obligation to "give possession" imposed on the Administrators and Leaseco by Art XI(2) of the Protocol. That invitation allowed Wells Fargo to exercise its right 54 See Gray, Gerber and Wool, "The Cape Town Convention aircraft protocol's substantive insolvency regime: a case study of Alternative A" (2016) 5 Cape Town Convention Journal 115 at 123-130. 55 11 USC §1110(c)(1). In re Republic Airways Holdings Inc (2016) 547 BR 578 at 586. 57 Official Commentary at 514-515 [5.61] (emphasis added). to take possession under Art 10 of the Convention notwithstanding s 440B of the Corporations Act as preserved by Art 30(3)(b) of the Convention so as to assume physical control of the aircraft engines to the exclusion of others. If Wells Fargo chose to exercise its right under Art 10 of the Convention, Art IX(3) of the Protocol required it to do so in a commercially reasonable manner. And if Wells Fargo chose to exercise its right under Art 10 of the Convention, Wells Fargo also had the ability to exercise additional rights under Art IX(1) of the Protocol as enhanced by Art XI(8) of the Protocol to procure the expeditious de- registration of the aircraft on which the aircraft engines were installed and to procure the expeditious export and physical transfer of the aircraft engines subject to any statutory lien registered in accordance with the Air Services Act. Unaffected all the while was Wells Fargo's right under the GTA as preserved by Art 12 of the Convention to demand redelivery of the aircraft engines. Similarly unaffected was the operation of s 440B of the Corporations Act as preserved by Art 30(3)(b) of the Convention to constrain the exercise of that right to demand redelivery under the GTA. Disposition The appeal is to be dismissed with costs. Certain consequential orders are to be made to accommodate the arrangement between the parties which facilitated the return of the aircraft engines pending the outcome of the appeal.

HIGH COURT OF AUSTRALIA MINISTER FOR IMMIGRATION AND CITIZENSHIP APPELLANT AND SZKTI & ANOR RESPONDENTS Minister for Immigration and Citizenship v SZKTI [2009] HCA 30 26 August 2009 ORDER Appeal allowed. Set aside the orders made by the Full Court of the Federal Court of Australia on 28 May 2008, and in their place make the following orders: "(a) Appeal allowed in part. Set aside Order 3 of the orders made by the Federal Magistrates Court of Australia on 22 October 2007, and in its place order that the first respondent to the application in that Court pay the applicant's costs, if any. Appeal otherwise dismissed. First respondent to pay the appellant's costs of the appeal." Appellant to pay the first respondent's costs of the appeal to this Court. On appeal from the Federal Court of Australia Representation S B Lloyd SC with L A Clegg for the appellant (instructed by Sparke Helmore Lawyers) R P L Lancaster with S J Free for the first respondent (instructed by Gilbert & Tobin Lawyers) Submitting appearance for the second respondent Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Minister for Immigration and Citizenship v SZKTI Immigration – Refugees – Review by Refugee Review Tribunal ("RRT") – Person telephoned, for purpose of obtaining information from that person, without procedures set out in ss 424(3) and 424B of Migration Act 1958 (Cth) ("Act") being followed – Whether RRT breached ss 424(3) and 424B of Act. Immigration – Refugees – After hearing, RRT obtained further information – Whether information raised new and additional issues – Whether RRT was obliged by s 425(1) of Act to invite first respondent to further hearing. Words and phrases – "get any information", "invite", "issues arising in relation to the decision under review". Migration Act 1958 (Cth), Pt 7 Div 4, ss 424, 424B, 425(1). FRENCH CJ, HEYDON, CRENNAN, KIEFEL AND BELL JJ. This appeal, brought from the Full Court of the Federal Court of Australia (Tamberlin, Goldberg and Rares JJ) ("the Full Court")1, and the appeal in Minister for Immigration and Citizenship v SZLFX ("SZLFX")2 were heard together. This is because a common issue of statutory construction under the Migration Act 1958 (Cth) ("the Act")3 arises in each appeal. What is said in these reasons on that issue applies also to SZLFX. The submissions in SZLFX concerning the common issue have been considered here. The first respondent is a citizen of the People's Republic of China. A submitting appearance was filed by the second respondent, the Refugee Review Tribunal ("the RRT"). For the reasons that follow, this appeal should be allowed. Summary of applicable legislation It is necessary to summarise the applicable legislation in order to understand the issues of statutory construction, which are framed by reference to a number of provisions. A delegate of the Minister can decide whether to grant or refuse a protection visa. Part 7 of the Act provides for administrative review of such decisions by the RRT. Division 4 of Pt 7 (ss 422B-429A) is a code of procedure4 for the conduct of that review (s 422B). In conducting the review the RRT is given a general power to "get any information that it considers relevant" under s 424(1) of the Act. Section 424(2) provides that "[w]ithout limiting subsection (1), the Tribunal may invite a person to give additional information." As pointed out by Gleeson CJ in SAAP v Minister for Immigration and Multicultural and Indigenous Affairs ("SAAP")5, this must be additional to information obtained under s 418, which provides for 1 SZKTI v Minister for Immigration and Citizenship (2008) 168 FCR 256. [2009] HCA 31. 3 Reprint No 10 is the applicable version of the Act for both this case and SZLFX. 4 See the Second Reading Speech on the Migration Legislation Amendment Bill (No 1) 1998: Australia, Senate, Parliamentary Debates (Hansard), 12 November 1998 at 214. See also the Explanatory Memorandum to the Migration Legislation Amendment Bill (No 1) 1998 (Cth) at [117]. (2005) 228 CLR 294 at 299 [4]; [2005] HCA 24. Crennan Bell the supply of the file of the Secretary to the Minister's department ("the Secretary"), or under s 423, which provides for the supply of statutory declarations and written arguments. On the facts of this case, "additional information" also includes information additional to that obtained or provided during the course of a hearing under s 425. In this case nothing turns on whether "additional information" could be read down to mean no more than "additional" to that which has already been given by the person from whom additional information is sought6. Section 424(3)(a) relevantly provides that an invitation by the RRT to a person to give additional information under s 424(2) must be given by one of the methods specified in s 441A. That section specifies methods of service by which the RRT "gives documents" to a person. Therefore, an invitation "to give additional information" under s 424(2) must be in a document to conform with Section 424B lays down certain requirements for any invitation so as to specify the methods and times by which a response to an invitation can be given. Section 425 provides that, subject to certain exceptions which are not presently relevant, the RRT must invite the applicant for review to appear before it "to give evidence and present arguments relating to the issues arising in relation to the decision under review." Issues The central issue in this appeal, which is also the central issue in SZLFX, is whether the RRT may telephone a person, for the purpose of obtaining information from that person, without following the procedures set out in ss 424(3) and 424B, having regard to s 441A of the Act which is incorporated by reference into s 424(3). It is common ground between the parties in both matters that the relevant procedures in ss 424(3) and 424B were not followed. The issue of whether the RRT was required to "get any information" by an invitation in writing, turns essentially upon the construction of the relevant statutory provisions. There is also an issue concerning the application of s 425 which arose only in this appeal. 6 Cf SZLPO v Minister for Immigration and Citizenship [2009] FCAFC 51. Crennan Bell The review by the RRT On 23 April 2006, the first respondent arrived in Australia and, on 23 May 2006, he applied for a Protection (Class XA) visa. The first respondent claims to fear persecution in China because he is a member of a religious group that the Chinese Communist Party refers to as the "Shouters" but which its members call the "Local Church". He alleges that his religious activities included spreading the Gospel while he was in China. He claims to fear that the Chinese authorities will arrest him if he returns to China because of his membership of the Local Church. On 19 August 2006, a delegate of the Minister refused to grant a protection visa to the first respondent. On 18 September 2006, the first respondent applied to the RRT for review of the delegate's decision and he attended an RRT hearing on 25 October 2006. At the hearing, the first respondent said that he participated in a Local Church group in Sydney. The first respondent gave the name of the most senior person of that Local Church group as "Tony" but he did not give any further details about that person. Following the hearing, on 24 January 2007, the RRT wrote two letters to the first respondent. One of the letters, which was headed "Invitation to Provide Information", included the following: "At your hearing, you gave some evidence about your religious practice in China. You also gave some evidence about your connection with the Local Church in Australia. You mentioned the name of the suburbs where church members meet; you described in general terms some of the activities that you participated in; and you named a few contact persons by first name, most prominent of whom was 'Tony'. The information you gave was extremely vague, and you did not provide details of witnesses or other material that might reasonably be expected to support your claims. The Tribunal requests information. that you provide the following additional The names, positions and any further details of the persons with whom you undertake religious activities, including 'Tony'. If any of these persons hold official positions within the church, you may also wish to provide statements from them describing their Crennan Bell knowledge of and connection with you. You may also wish, in any response to this letter, to provide any other evidence to assist your case." By letter dated 7 February 2007, the first respondent replied to both letters. Attached to his letter was a second letter, which bore the letterhead of "The Local Church in Sydney". The second letter stated: "This is to confirm that [the first respondent] has been meeting regularly with the church for the past nine months. Please do not hesitate to contact Tony Cheah on [mobile telephone number] should you have any further enquiry." The letter was signed by Mr Tony Cheah and Mr David Foley, whom the first respondent referred to as "Elders" of the Local Church. On 4 April 2007, some five months after the hearing, the RRT telephoned Mr Cheah on the mobile telephone number which was provided in that letter. Following this telephone conversation, the RRT wrote to the first respondent on 11 April 2007. That letter set out certain information and explained why, in the RRT's view, it was relevant to the first respondent's application in the following terms: "The Tribunal spoke to Mr Tony Cheah on 4 April 2007, to follow up the letter that he and Mr David Foley wrote on 5 February 2007, in which they 'confirm[… that you have] been meeting regularly with the church for the past nine months.' Mr Cheah confirmed the following: - He knows you personally; - He believes you come from Fuqing, Fujian; - He 'understands' that you were a Christian in China; - You attend the Local Church in Blacktown, and are involved in learning scripture, 'training' to assist in services and in setting up the meeting place. However, Mr Cheah said he did not know whether you were a member of any Local Church in China; where you had lived and worked in China; or whether you had experienced any problems there. Crennan Bell This information is relevant for the following reasons: It appears that Mr Cheah's knowledge of you is superficial. It is surprising that you have not had occasion to inform him of any association with the Local Church in China and your alleged experiences there. - This may in turn suggest that you have become involved in the Local Church only in Australia (depending on the Tribunal's assessment of your claims with respect to China). - Mr Cheah's statements that you are 'learning scripture', 'training' to assist with services and helping set up meeting rooms may also indicate that you are a newcomer to the church and possibly Christianity, and not a longer-term Christian as you claim. In assessing whether you have a well-founded fear of persecution in China, the Tribunal is required by s 91R(3) of the Act to disregard conduct that you have engaged in in Australia, unless it is satisfied that you have done so other than for the purpose of strengthening your claim to be a refugee. Factors that may influence whether the Tribunal is satisfied may include the credibility of your claimed experiences in China, and the nature of your activities in Australia." The letter invited the first respondent to comment upon the information. In a statutory declaration dated 26 April 2007, which the first respondent's migration agent provided to the RRT, the first respondent commented on the information. These comments included the following: "The reason why I have not informed Mr Cheah of my association with the Local Church in China as well as my sufferings and experiences there is that I am afraid of being misunderstood and I do not like being regarded as a person who may intend to use the Local Church as a vehicle for seeking protection in Australia. As a member of the Local Church, I am required to continue learning scripture every day, because studying [the] Bible is particularly important for a member of the Local Church. Also, I am obligated to contribute to the Local Church; and thus it is quite normal that I have accepted training to assist with services or helping set up meeting rooms." Crennan Bell The RRT affirmed the decision under review on 15 May 2007. The RRT concluded that the first respondent was not a person to whom Australia owed protection obligations and, therefore, the first respondent was not entitled to a Protection (Class XA) visa. In reaching this decision, the RRT found that the first respondent was not a practising Christian at the time of his departure from China. The RRT found that the first respondent did not have a genuine commitment to Christianity and therefore would not engage in, or need to refrain from, religious conduct in China that might give rise to a real chance of Convention-related7 persecution. In making these findings, the RRT relied upon the telephone call which it had made to Mr Cheah. In reasoning towards the conclusion that the first respondent was not a Christian when he left China, the RRT stated8: "The Tribunal finds that the applicant's documentary and witness evidence sheds little light on his claimed Christian practice in China. As noted in the Tribunal's letter of 11 April 2007, Mr Cheah's (and Mr Foley's) written and oral advice to the Tribunal revealed only a superficial knowledge of the applicant's profile in China, indicating an 'understanding' that he had been a Christian there. The absence of any reference to the applicant's activities in China, let alone his claimed past harm and future concerns, amounts to weak support for the applicant's claims. The applicant commented that he did not wish the church to view him as a person who was using them to advance his refugee application. This contrasts markedly with the applicant's reliance on the church in China, for financial, logistic and other assistance, in circumstances where the church itself faces considerable risks. Whatever the reason for the Local Church in Sydney knowing very little about the applicant, the Tribunal finds that it provides scant support for the applicant's claim to have been an active Christian in China." Later in the RRT's reasons, it was also observed that, among other things, it was "the content and tenor of the superficial comments from Mr Cheah" that 7 The Convention relating to the Status of Refugees done at Geneva on 28 July 1951 as amended by the Protocol relating to the Status of Refugees done at New York on 31 January 1967. 8 Refugee Review Tribunal, Statement of Decision and Reasons, 15 May 2007 ("Reasons of the RRT") at 14-15. Crennan Bell suggested that "the applicant's exposure to Christianity is recent, superficial and limited."9 The Federal Court proceedings The first respondent sought judicial review in the Federal Magistrates Court of the RRT's decision. He did not allege any breach of s 424 of the Act. His application was dismissed10. An appeal by the first respondent to the Federal Court of Australia came before Rares J on 4 March 2008. His Honour identified the issue at the centre of this appeal on his own motion and the matter was ultimately referred to the Full Court. The Full Court allowed the appeal on the basis that the RRT could not obtain information by telephone from Mr Cheah without complying with s 424(2) and (3) of the Act11. The appeal to this Court The appeal to this Court mainly requires a determination of whether the RRT breached ss 424(3) and 424B and whether, if it did, that amounted to jurisdictional error, in which case relief would be available despite s 474 of the Act, which covers privative clause decisions12. Those questions turn on the construction of the provisions in the wider statutory context13, particularly Div 4 of Pt 7, in order to determine both how ss 424(3) and 424B apply and the effect of any failures to comply with them. There is also a Notice of Contention from the first respondent, asserting that the RRT was obliged to, but did not, issue a second invitation to the first respondent to appear before the RRT to give evidence and present arguments regarding what were said to be additional issues arising from the RRT's telephone enquiries of Mr Cheah. This was described as a failure to comply with 9 Reasons of the RRT at 16. 10 SZKTI v Minister for Immigration [2007] FMCA 1904. 11 SZKTI v Minister for Immigration and Citizenship (2008) 168 FCR 256 at 270 12 Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476; [2003] HCA 2. 13 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 381 [69] per McHugh, Gummow, Kirby and Hayne JJ; [1998] HCA 28. Crennan Bell s 425(1) of the Act and was said to be a jurisdictional error by reference to SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs ("SZBEL")14. Applicable legislation It is necessary to give more detailed consideration to some of the provisions which are relevant to the task of construing s 424. Section 422B15 provides that Div 4 of Pt 7 "is taken to be an exhaustive statement of the requirements of the natural justice hearing rule in relation to the matters it deals with" in respect of the RRT's conduct of its review. The general nature of the RRT's "way of operating"16 is described in s 420(1)17 as "fair, just, economical, informal and quick." The RRT "is not bound by technicalities, legal forms or rules of evidence" (s 420(2)(a)) and "must act according to substantial justice and the merits of the case" (s 420(2)(b)). Section 420 does not prescribe any particular procedure18. Section 424 relevantly states: In conducting the review, the Tribunal may get any information that it considers relevant. However, if the Tribunal gets such information, the Tribunal must have regard to that information in making the decision on the review. (2) Without limiting subsection (1), the Tribunal may invite a person to give additional information. 14 (2006) 228 CLR 152; [2006] HCA 63. 15 This section came into effect on 4 July 2002 and was inserted into the Act by the Migration Legislation Amendment (Procedural Fairness) Act 2002 (Cth). 16 Heading to s 420; see SAAP (2005) 228 CLR 294 at 298 [1] per Gleeson CJ. 17 In Div 3 of Pt 7, headed "Exercise of Refugee Review Tribunal's powers". 18 Minister for Immigration and Multicultural Affairs v Eshetu (1999) 197 CLR 611 at 635 [74]-[77] per Gaudron and Kirby JJ, 664-668 [176]-[179] per Callinan J endorsing the reasons for judgment of Lindgren J in Sun Zhan Qui v Minister for Immigration and Ethnic Affairs unreported, Federal Court of Australia, 6 May 1997 Crennan Bell The invitation must be given to the person: except where paragraph (b) applies—by one of the methods specified in section 441A; or Section 441A specifies the methods by which documents can be served. Documents can be given "by hand" (s 441A(2)), or be provided by "[h]anding [them] to a person at [the] last residential or business address" who appears to be at least 16 (s 441A(3)), or be given by "[d]ispatch by prepaid post or by other prepaid means" (s 441A(4)) or by "[t]ransmission by fax, e-mail or other electronic means" (s 441A(5)). Section 424A(1) provides for the RRT to give to the applicant for review, in any way that it considers appropriate, particulars of information that the RRT considers would be the reason, or part of the reason, for affirming the decision under review, to ensure, so far as is reasonably practicable, that the applicant understands why it is relevant, and to invite the applicant to comment on it. Any invitation under s 424(2) is subject, not only to the formal requirements of s 424(3), but also to the formal requirements of s 424B, which is headed "Invitation to give additional information or comments". Section 424B relevantly provides: If a person is: invited under section 424 to give additional information; or the invitation is to specify the way in which the additional information … may be given, being the way the Tribunal considers is appropriate in the circumstances. If the invitation is to give additional information … otherwise than at an interview, the information … [is] to be given within a period specified in the invitation, being a prescribed period or, if no period is prescribed, a reasonable period. If the invitation is to give information … at an interview, the interview is to take place: Crennan Bell at the place specified in the invitation; and at a time specified in the invitation, being a time within a prescribed period or, if no period is prescribed, a reasonable period. Section 424C provides that the failure of any person to respond within time to a formal invitation under s 424(2) does not prevent the RRT from proceeding to make a decision. It is also relevant to note that the RRT has a power to summon a person to give evidence and/or produce documents under s 427(3). It is an offence to fail to attend (s 432(1)) or to refuse to answer a question which the RRT requires to be answered (s 433(1)). A person who is summoned to appear before the RRT to give evidence is given the same protection as a witness in proceedings in the Administrative Appeals Tribunal (s 435(2)). The RRT is empowered to take evidence on oath or affirmation (s 427(1)(a)). In the context of s 429A(a), which provides that evidence can be given "by telephone", the first respondent's complaint is not that the evidence of Mr Cheah was given by telephone; rather, the complaint is that the telephone call contained an invitation to give additional information which should have been in writing, and was not. Submissions in this Court That the review process followed by the RRT is inquisitorial has already been remarked by this Court19. In that context the Minister submitted that there were three powers by which the RRT could obtain information, with a descending order of consequences for any refusal to respond: first, by compulsory process (s 427(3)), a breach of which constitutes an offence; secondly, by formal invitation (s 424(2)), where a failure to respond to the 19 For example, in SAAP (2005) 228 CLR 294 at 300 [8] per Gleeson CJ, 313-314 [55] per McHugh J, 330 [112] per Gummow J, 351 [197] per Hayne J. See also SZBEL (2006) 228 CLR 152 at 164 [40]; SZAYW v Minister for Immigration and Multicultural and Indigenous Affairs (2006) 230 CLR 486 at 491 [4]; [2006] HCA 49; Minister for Immigration and Multicultural and Indigenous Affairs v QAAH of 2004 (2006) 231 CLR 1 at 17 [40] per Gummow ACJ, Callinan, Heydon and Crennan JJ, 46-47 [134]-[137] per Kirby J; [2006] HCA 53. Crennan Bell invitation allows the RRT to proceed to make a decision on the review without giving a hearing (ss 424C(1) and 425(2)(c)); and thirdly, by an informal process seeking voluntary answers, where no potential adverse consequences to the applicant for review are engaged. Section 424(1) was construed by the Minister as a general facultative power in aid of the inquisitorial functions of the RRT, distinguishable from both the compulsory process under the Act and the formal statutory process which could result in the loss of a right to a hearing. By way of comparison, the Minister construed s 424(2) as a special or particular method (other than compulsory process) by which the RRT can obtain additional information. Failure by the applicant to respond to an invitation under s 424(2) carries the consequence that the RRT may make a decision on the review without inviting the applicant for review to appear at a hearing (ss 424C(1) and 425(2)(c)). The applicant in those circumstances is not entitled to a hearing (s 425(3)). That consequence distinguished this method of obtaining information from the general informal power to get information under s 424(1). Refusal to provide information under s 424(1) carries no adverse consequences for the applicant in respect of the right to a hearing under s 425. In support of his construction of s 424, the Minister relied on the statutory context, some historical matters, and the express language of relevant provisions. For the reasons which follow, these submissions of the Minister should be accepted despite an argument from the first respondent that emphasised procedural fairness and relied on the authority of Anthony Hordern & Sons Ltd v Amalgamated Clothing and Allied Trades Union of Australia ("Anthony Hordern")20. That reliance will be discussed later in these reasons. Some historical matters. Before the enactment of the Migration Legislation Amendment Act (No 1) 1998 (Cth), which inserted ss 424, 424A, 424B, 424C and 425 as they were substantially in operation for this case, the former s 424 contained a limit on what constitutes "the papers" in a review. As explained by Gummow J in SAAP21: "that expression ['the papers'] comprised only the documents given to the Registrar under s 418 (the file the Secretary to the Minister's department 20 (1932) 47 CLR 1 at 7 per Gavan Duffy CJ and Dixon J, 20-21 per McTiernan J; [1932] HCA 9. 21 (2005) 228 CLR 294 at 334 [128]. Gummow J was in dissent in the result but his Honour's observations quoted above are not controversial. Crennan Bell had supplied) and s 423 (statutory declarations and written arguments provided by the Secretary of the Minister's department and by the applicant in relation to the decision under review) of the Act." The amendments permitted expansion of the documentary evidence before the RRT and linked an applicant's right to a hearing to compliance with an invitation to give additional information or comments on additional information. In explaining the purpose of these changes in the Second Reading "This code [of procedure] includes such matters as the giving of a prescribed notice of the timing for a hearing, and a requirement that applicants be given access, and time to comment, on adverse material relevant to them." In addition, he stated that the Bill contained a number of measures to allow for more flexible processes in both the Migration Review Tribunal and the RRT. These included: "enabling the Tribunals to use telephone or other media to conduct personal hearings or to require other witnesses to appear before them; and allowing Tribunals to proceed to a decision without delay, if an applicant does not respond to a notice to attend a hearing or provide comment. Taken together, these changes mean that people with bona fide review applications will be given a decision more quickly and a better decision if the initial decision is wrong."23 The statutory context. Under s 415(1), the RRT is given all the powers and discretions that are conferred by the Act on the person who made the decision. These include the power to get information which is thought to be relevant (s 56(1)) and the power to invite an applicant to give additional information (s 56(2)). An invitation to provide information can be to provide it over the telephone (s 58(1)(e)) and the procedures in s 58 do not prevent the Minister from obtaining information from an applicant by telephone or in any other way (s 59(2)). The powers given under s 56 work simultaneously with the 22 Australia, Senate, Parliamentary Debates (Hansard), 12 November 1998 at 214. 23 Australia, Senate, Parliamentary Debates (Hansard), 12 November 1998 at 214. Crennan Bell powers given under s 42424, although there is no constraint similar to that found in s 424(2) because under s 56(2) the Minister may "orally or in writing" invite an applicant "to give additional information". Where an application for review is made to the RRT, the Secretary is obliged to give the Registrar of the RRT a statement about the decision under review and copies of the documents considered by the Secretary to be relevant to the review (s 418). As already mentioned, Div 3 of Pt 7 is concerned with the exercise of the RRT's powers which are to be used in providing a review that is "fair, just, economical, informal and quick" (s 420(1)). Division 4 of Pt 7 is concerned with the conduct of the review. Division 5 of Pt 7 requires the RRT to prepare a written statement of reasons (s 430) and provides for provision of those reasons to both the applicant for review and the Secretary (ss 430A-430D). Division 6 of Pt 7 contains offences. It is an offence for a person served with a summons to attend to fail to attend (s 432(1)) or to refuse to answer a question that the RRT requires the person appearing to answer (s 433(1)). Division 7 of Pt 7 contains miscellaneous provisions and Div 7A of Pt 7 provides for the giving and receiving of review documents. As to the conduct of the review, with which this case is concerned, an applicant for review is entitled to give the RRT a statutory declaration and written arguments (s 423(1)). The Secretary may also provide written arguments (s 423(2)). The RRT must invite an applicant for review to comment on adverse material (ss 424A and 424B). The RRT is authorised by s 424C to make a decision on the review if there is no response to an invitation to comment within the time allowed. Section 425(1) obliges the RRT to invite applicants to appear before it to give evidence and present arguments although that obligation ceases if an applicant fails to respond to an invitation (s 425(2)(c)). It can also be noted that the RRT can require the Secretary to arrange for the making of investigations and to report back to it (s 427(1)(d)) and, as already noted, the RRT may allow for the giving of evidence by telephone (s 429A). 24 SAAP (2005) 228 CLR 294 at 333 [126] per Gummow J. Crennan Bell Section 424 Such is the historical and statutory context in which s 424 falls to be assessed. Section 424(1) confers a "general power"25 on the RRT to "get any information that it considers relevant." The only limitation on that power is that the RRT "must have regard" to that information in making its decision. As pointed out by the first respondent, the general power is apt for the obtaining of country information which might involve research or utilisation of library resources or publicly available information on the internet. However, the language is plainly not confined so as to preclude the obtaining of information from a person by telephone. That process is consonant with the inquisitorial nature of the RRT and the statutory obligation upon it to adopt procedures which are not only "fair [and] just" but are also "economical, informal and quick."26 It is true, as was pointed out by the first respondent, that such a procedure does not require a record of the questions asked of Mr Cheah, a transcript or note of his response, or any other way to assess whether or not the RRT's summary of the conversation was accurate and complete. However, so much follows from the statutory silence in s 424(1) about how the RRT "may get any information that it considers relevant." Further, s 429A, which permits the giving of evidence by telephone, does not require any record of what is asked or of any response. What is important from the viewpoint of procedural fairness is that the applicant for review is given an opportunity to comment on the additional information. That was given in this case by the letter conforming with s 424A which was sent to the first respondent soon after the telephone call to Mr Cheah. In support of his position that s 424(1) should not be construed as authorising the RRT to exercise the specific power in s 424(2) to "invite a person to give additional information", otherwise than in accordance with the mandatory language in ss 424(3) and 424B, the first respondent relied on the principle of construction enunciated in the Anthony Hordern case. Anthony Hordern concerned the Commonwealth Conciliation and Arbitration Act 1904 (Cth) and two powers for the making of an award relating to giving preference to unionists. 25 SAAP (2005) 228 CLR 294 at 299 [4] per Gleeson CJ; see also at 312 [50] per McHugh J, 352 [199] per Hayne J. 26 Section 420(1). Crennan Bell In Anthony Hordern27, Gavan Duffy CJ and Dixon J said: "When the Legislature explicitly gives a power by a particular provision which prescribes the mode in which it shall be exercised and the conditions and restrictions which must be observed, it excludes the operation of general expressions in the same instrument which might otherwise have been relied upon for the same power." In Minister for Immigration and Multicultural and Indigenous Affairs v Nystrom28, Gummow and Hayne JJ said: "Anthony Hordern and the subsequent authorities have employed different terms to identify the relevant general principle of construction. These have included whether the two powers are the 'same power', or are with respect to the same subject matter, or whether the general power encroaches upon the subject matter exhaustively governed by the special power. However, what the cases reveal is that it must be possible to say that the statute in question confers only one power to take the relevant action, necessitating the confinement of the generality of another apparently applicable power by reference to the restrictions in the former power." (footnotes omitted) In the context of the introductory wording of s 424(2), "[w]ithout limiting subsection (1)", Leon Fink Holdings Pty Ltd v Australian Film Commission ("Leon Fink")29 was relied on by the Minister. That case concerned the powers of the Australian Film Development Corporation ("the Corporation") to make loans. Section 20(1) of the Australian Film Development Corporation Act 1970 (Cth) provided that "[t]he functions of the Corporation are to encourage the making of Australian films and to encourage the distribution of Australian films both within and outside Australia." Section 21(1)(a) provided that "without limiting the generality of the foregoing" the Corporation "has power … to make loans … to producers of Australian films". The Corporation made loans to borrowers in circumstances where neither the borrower, nor the guarantor of the loan, was a producer of Australian films. 27 (1932) 47 CLR 1 at 7. 28 (2006) 228 CLR 566 at 589 [59]; [2006] HCA 50. 29 (1979) 141 CLR 672; [1979] HCA 26. Crennan Bell After referring to Anthony Hordern, Mason J said30: "In this case the words 'without limiting the generality of the foregoing' evince an intention that the general power should be given a construction that accords with the width of the language in which it is expressed and that this construction is not to be restricted by reference to the more specific character of that which follows. The clause therefore operates to negative the restrictive implication which might otherwise have been derived from the presence of the specific power to lend contained in par (a) [of s 21(1)]." The first respondent countered the Minister's reliance on the reasoning of Mason J in Leon Fink by pointing to Dainford Ltd v Smith31, in which Brennan J held that similar words, namely, "[w]ithout limiting the generality of any other provision of this section", did not displace the Anthony Hordern principle. The first respondent's submission turns on the proposition that s 424(1) and (2) cover the same powers, that s 424(2) is encompassed within, or is a subset of, the general power in s 424(1). There is a difficulty with that submission. Section 424(1) puts into statutory form a power to obtain information by asking questions. This is an obvious power to give to an inquisitorial body. Subject to not interfering with the liberty of another, making an enquiry with no power to compel an answer is not an unlawful activity32. No adverse consequences flow against the applicant for review if the applicant, or any other person questioned, fails to co-operate or to give the information sought. By comparison, the specific power in s 424(2) governed by ss 424(3) and 424B, to give an invitation in writing to provide additional information, results in the adverse consequence that an applicant who fails to respond to an invitation in writing is deprived of the entitlement to a hearing. These critical distinctions emphasise the fact that the powers in ss 424(1) and 424(2) are, in law, significantly dissimilar. The general power to "get" information and the specific power to "invite" in writing the giving of additional information are capable of co-existing without the latter being repugnant to the former. Further, an oral request for information 30 (1979) 141 CLR 672 at 679. 31 (1985) 155 CLR 342 at 361-362; [1985] HCA 23. 32 Clough v Leahy (1904) 2 CLR 139 at 157 per Griffith CJ; [1904] HCA 38. Crennan Bell would be authorised not only by s 424(1) of the Act but also by s 56(1), by reason of the operation of s 415 which has been explained above. The Full Court gave prominence and weight to the view that ss 424(2) and (3) and 424B were important provisions in relation to procedural fairness. So they are. However, nothing in those sections detracts from the obvious purpose of s 424(1), the general terms of which permit the getting of information from a person by telephone. It would be cumbersome to require the RRT to telephone a person for the purpose of getting information only after an invitation in writing to give additional information is given to that person. Such a requirement would seem inimical to the RRT's way of operating as "economical, informal and quick."33 Given all the considerations described above, the phrase "[w]ithout limiting subsection (1)", as it occurs in s 424(2), means that the procedural restrictions on the specific power to issue an invitation to give additional information do not qualify the RRT's general power in s 424(1) to "get any information that it considers relevant". Accordingly the circumstances of this case did not involve a breach of either s 424(3) or s 424B. Section 425 A further issue, and one which did not arise in SZLFX, arose in relation to s 425(1) of the Act, which provides: "The Tribunal must invite the applicant to appear before the Tribunal to give evidence and present arguments relating to the issues arising in relation to the decision under review." (emphasis added) It was contended by the first respondent in his written submissions that the information given by Mr Cheah raised new and additional issues and accordingly the RRT was obliged to issue an invitation to a second hearing. These were identified as (i) the alleged failure of the first respondent to inform Mr Cheah of his association with the Local Church in China, where he had lived and worked in China, and whether he had experienced any problems there; (ii) the alleged fact that the first respondent was a newcomer to the Local Church and not a "longer-term Christian"34; and (iii) that Mr Cheah's account of his relationship 33 Section 420(1). 34 Letter from the RRT to the first respondent of 11 April 2007: see [14] above. Crennan Bell with the first respondent suggested that the first respondent's religious activity in Australia was done only for the purpose of strengthening his claim to be a refugee. The Minister's written submissions responded that the issues were not new. The RRT had specifically put in issue the first respondent's claim to be a committed Christian, to be a leader or organiser, and to have a fear of persecution by reason of religious activities. In oral submissions, counsel for the first respondent offered a different characterisation of the new issue, identifying it as being the first respondent's account to Mr Cheah and Mr Cheah's knowledge of the first respondent's past activities in China. During the hearing, the RRT had questioned important aspects of the first respondent's evidence and raised as an issue the truth of his claim of an association with the Local Church in China. For example, the RRT queried the first respondent's membership of a church about whose members and history he knew so little and raised country information inconsistent with the first respondent's evidence. The RRT also queried whether church meetings could be secret as claimed by the first respondent. The RRT drew attention to inconsistencies in the first respondent's claims, asked the first respondent to compare his practice of religion in China with his practice of religion in Australia and informed him that his evidence regarding his religious practice had been "vague and lacking detail". Finally, the RRT asked the first respondent whether he had told Mr Cheah about his review application. Whether an issue must be raised with an applicant for the purposes of a further hearing under s 425(1) will depend on the circumstances of each case. Matters may arise requiring an invitation to a further hearing. However, that is not the case in the present matter. Here, Mr Cheah's evidence was additional evidence about an extant issue; it did not constitute the raising of a new or additional issue such as to trigger the obligation to give another hearing. This distinguishes the facts here from those considered in SZBEL. The extant issue was whether the first respondent had been an active Christian in China. Mr Cheah's knowledge of the first respondent's past activities in China deriving from any account given to him by the first respondent was directly related to that issue. Further, s 422B of the Act suggests that there is no residual procedural fairness requirement to give another hearing extraneous to Div 4 of Pt 7. If there were any extraneous right to procedural fairness, as suggested by the first respondent, there was no breach of the obligation here. Importantly, the first respondent had an opportunity to deal with Mr Cheah's information by responding (as he did) to the letter from the RRT conforming with s 424A. Crennan Bell Conclusions The Full Court erred in applying the principle in Anthony Hordern and construing s 424(2) of the Act as limiting the generality of s 424(1). The RRT can lawfully obtain information by telephone without following the formal procedures set out in ss 424(3) and 424B. The first respondent also fails in respect of his Notice of Contention. The RRT was not obliged in the circumstances to issue a invitation to the first respondent to again appear before For the reasons given, no jurisdictional errors arose as a result of not following the procedures laid down in ss 424(3) and 424B or because the RRT did not give the first respondent an additional hearing under s 425. Order The appeal should be allowed. In accordance with an undertaking given on behalf of the Minister, the Minister is to pay the first respondent's costs and the orders for costs given below in favour of the first respondent will not be disturbed.

HIGH COURT OF AUSTRALIA Matter No P47/2016 WESTERN AUSTRALIAN PLANNING COMMISSION APPELLANT AND SOUTHREGAL PTY LTD & ANOR RESPONDENTS Matter No P48/2016 WESTERN AUSTRALIAN PLANNING COMMISSION APPELLANT AND TREVOR NEIL LEITH RESPONDENT Western Australian Planning Commission v Southregal Pty Ltd Western Australian Planning Commission v Leith [2017] HCA 7 8 February 2017 P47/2016 & P48/2016 ORDER Matter No P47/2016 Appeal allowed. Set aside orders (a) and (b) of the Court of Appeal of the Supreme Court of Western Australia made on 24 March 2016, and in their place order that: appeal allowed; the respondents pay the appellant's costs; and set aside orders 2, 3 and 4 of Beech J made on 22 December 2014, and in their place order that: the question of law be answered: No; and the plaintiffs are to pay the defendant's costs. The respondents pay the appellant's costs of the appeal to this Court. Matter No P48/2016 Appeal allowed. Set aside orders (a) and (b) of the Court of Appeal of the Supreme Court of Western Australia made on 24 March 2016, and in their place order that: appeal allowed; the respondent pay the appellant's costs; and set aside orders 2, 3 and 4 of Beech J made on 22 December 2014, and in their place order that: the question of law be answered: No; and the plaintiff is to pay the defendant's costs. The respondent pay the appellant's costs of the appeal to this Court. On appeal from the Supreme Court of Western Australia Representation K M Pettit SC with T C Russell for the appellant in both matters (instructed by State Solicitor (WA)) D F Jackson QC with P McQueen for the respondents in both matters (instructed by Lavan) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Western Australian Planning Commission v Southregal Pty Ltd Western Australian Planning Commission v Leith Town planning (WA) – Compensation – Where land reserved for public purpose under planning scheme – Where s 173 of Planning and Development Act 2005 (WA) makes provision for landowner to be compensated where land injuriously affected by making or amendment of planning scheme – Where, under s 177, compensation not payable until land first sold after reservation or responsible authority refuses development application or grants application on unacceptable conditions – Where landowners purchased land affected by planning scheme after date of reservation – Where purchasers applied to develop land and were refused – Whether purchasers entitled to compensation. Words and phrases – "compensation", "injurious affection", "planning scheme", "reservation". Metropolitan Region Town Planning Scheme Act 1959 (WA), s 36. Planning and Development Act 2005 (WA), ss 171, 173, 174, 176, 177. Town Planning and Development Act 1928 (WA), ss 11, 12. KIEFEL AND BELL JJ. The Peel Region Scheme is a planning scheme made pursuant to the provisions of the Planning and Development Act 2005 (WA) ("the PD Act"). It came into effect in March 20031 and relevantly reserved the land in question in these appeals for a public purpose, namely for regional open space. At that time the land was owned by persons other than the respondents. In October 2003 Southregal Pty Ltd ("Southregal") and Mr Wee, the respondents in the first appeal, purchased land affected by the reservation and in 2008 applied to develop it. In June 2003 Mr Leith, the respondent in the second appeal, purchased land affected by the reservation and in 2009 applied to develop it. Both applications were refused on account of the reservation. The respondents each claimed compensation pursuant to the provisions of Pt 11 of the PD Act. The claims were refused by the appellant, the Western Australian Planning Commission ("the WAPC"), on the basis that compensation under the PD Act was only available to the person who owned the land at the time of its reservation. Each of the respondents brought proceedings in the Supreme Court of Western Australia, in which they claimed to be entitled to compensation. The Court directed that a Special Case be prepared. The primary judge (Beech J) stated the question arising on each Special Case as: "Whether a person to whom s 177(2)(b) of [the PD Act] would otherwise apply can be entitled to compensation pursuant to ss 173 and 177(1)(b) of the PD Act, in circumstances where the land has been sold following the date of the reservation, and where no compensation has previously been paid under s 177(1) of the PD Act." Beech J answered the question arising on each Special Case in the affirmative2. The Court of Appeal upheld that decision3. The provisions of Pt 11 of the PD Act Part 11 of the PD Act makes provision for a landowner to be compensated, including where land has been injuriously affected by a planning scheme. Section 173(1) provides: 1 Although the Peel Region Scheme came into effect prior to the commencement of the PD Act, the effect of the statutory regime is that any entitlement of the respondents to compensation for injurious affection is governed by the PD Act. 2 Leith v Western Australian Planning Commission [2014] WASC 499. 3 Western Australian Planning Commission v Southregal Pty Ltd (2016) 49 WAR Bell "Subject to this Part any person whose land is injuriously affected by the making or amendment of a planning scheme is entitled to obtain compensation in respect of the injurious affection from the responsible authority." Section 174 details the circumstances in which land may be injuriously affected. Section 174(1) relevantly provides: "Subject to subsection (2), land is injuriously affected by reason of the making or amendment of a planning scheme if, and only if – that land is reserved (whether before or after the coming into operation of this section) under the planning scheme for a public purpose; Section 176(1) provides that a claimant or responsible authority may apply to the State Administrative Tribunal to determine any question as to whether land is injuriously affected. Sub-section (2) provides that any question as to the amount and manner of payment of compensation is to be determined by arbitration, in the absence of agreement on some other method of determination. Section 177(1) and (2) deals with when compensation "is payable" and to whom it is payable. It provides: "(1) Subject to subsection (3), when under a planning scheme any land has been reserved for a public purpose, no compensation is payable by the responsible authority for injurious affection to that land alleged to be due to or arising out of such reservation until – the land is first sold following the date of the reservation; or the responsible authority – refuses an application made under the planning scheme for approval of development on the land; or (ii) grants approval of development on the land subject to conditions that are unacceptable to the applicant. (2) Compensation for injurious affection to any land is payable only once under subsection (1) and is so payable – Bell (a) under subsection (1)(a) to the person who was the owner of the date of reservation referred land at the subsection (1)(a); or (b) under subsection (1)(b) to the person who was the owner of the date of application referred land at the subsection (1)(b), unless after the payment of that compensation further injurious affection to the land results from – (c) an alteration of the existing reservation of the land; or the imposition of another reservation of the land." Section 177(3)(a) provides that, "[b]efore compensation is payable" under s 177(1), in the case of the first sale, the person appointed to determine the amount of compensation must be satisfied of three matters: the owner of the land has sold the land at a lesser price than the owner might reasonably have expected to receive had there been no reservation of the land under the planning scheme; the owner before selling the land gave written notice to the responsible authority of the owner's intention to sell the land; and (iii) the owner sold the land in good faith and took reasonable steps to obtain a fair and reasonable price for the land. In the case of refusal of a development application, or approval on conditions unacceptable to the applicant, s 177(3)(b) provides that the person determining compensation must be satisfied that the application was made in good faith. Section 178(1)(a) relevantly requires that a claim for compensation for injurious affection to land by the making or amendment of a planning scheme where land is reserved is to be made within six months of either the sale of the land, the refusal of a development application or its approval on unacceptable conditions. Section 179(1) provides that the amount of compensation for injurious affection arising out of the land being reserved for public purposes is not to exceed the difference between the value of the land as so affected by the existence of the reservation and the value of the land if it were not so affected. Section 179(2) provides that the values are to be assessed as at the date on which the land is sold; an application for approval of development is refused; or the approval is granted subject to unacceptable conditions. Bell The focus of these appeals is on ss 173, 177(1) and 177(2). Western Australian Planning Commission v Temwood Holdings Pty Ltd In Western Australian Planning Commission v Temwood Holdings Pty Ltd4, consideration was given by this Court to s 11 of the Town Planning and Development Act 1928 (WA) and s 36 of the Metropolitan Region Town Planning Scheme Act 1959 (WA) ("the MRTPS Act"). Section 11(1) is in terms substantively equivalent to s 173 of the PD Act; s 36(3)(a) and (b) is substantively equivalent to s 177(1)(a) and (b); and s 36(3a)(a) and (b) is substantively equivalent to s 177(2)(a) and (b). For ease of reference we will refer to the equivalent provisions of the PD Act when discussing the reasons in Temwood. In Temwood, a developer purchased land that included coastal foreshore which had previously been reserved under a town planning scheme. The WAPC approved the development application for three subdivisions of the land subject to a condition in each case that the developer cede the relevant portion of the foreshore reserve to the Crown, free of costs and without compensation. The condition was held to be valid. More relevantly for present purposes, what was described by Gummow and Hayne JJ as a "threshold issue" arose concerning the provisions equivalent to ss 173 and 177. As their Honours explained5, if the developer, as successor in title to the owner of the land when the foreshore was reserved, enjoyed no statutory right to compensation for injurious affection, then much of its case would fail. Their Honours held that the developer was not entitled to claim compensation. McHugh J and Callinan J came to the opposite view. Heydon J considered that the issue did not arise and did not address it. McHugh J's reasons did not differ from those of Gummow and Hayne JJ on all aspects of the construction of the provisions in question. It was the introduction of the equivalent of s 177(2)(b) in 1986 which provided the critical point of departure in his Honour's reasons, as will be explained. Gummow and Hayne JJ and McHugh J were agreed6 that the equivalent of s 173(1) conferred on the owner of land injuriously affected by a planning (2004) 221 CLR 30; [2004] HCA 63. 5 Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30 at 67-68 [94]. 6 Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30 at 45 [30] per McHugh J, 68 [95] per Gummow and Hayne JJ. Bell scheme an entitlement to compensation. McHugh J considered7 that the entitlement was best described as a "liberty" or "expectation". However, his Honour and Gummow and Hayne JJ considered8 it to be possible that the nature of the entitlement was such that it might survive any repeal of the equivalent of s 173(1), by the application of the provisions of the Interpretation Act 1984 These observations may be put to one side. The point made by McHugh J10 was that the equivalent of s 177(1) had the effect of postponing the entitlement. Until one of the three events there listed occurred, "there is no interest, right or privilege that the owner of the Land could enforce against anyone"11. Gummow and Hayne JJ also held12 that the equivalent of s 177(1) had the effect that the right to payment was deferred until one of those events occurred. The point of departure between Gummow and Hayne JJ and McHugh J is as follows. Gummow and Hayne JJ were of the view13 that the equivalent of s 177(1) is to be construed by treating the deferral of the entitlement to payment as terminated upon the first of the three events to occur. Once one of the three events triggered a claim for compensation, the later occurrence of the two remaining events could not trigger a further claim. On this construction, because the land in question in these proceedings was first sold to the respondents by persons who owned the land at the date of reservation, the respondents are not able to claim compensation. 7 Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30 at 45 [30]. 8 Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30 at 46 [31] per McHugh J, 68 [96] per Gummow and Hayne JJ. Interpretation Act 1984 (WA), s 37(1)(c). 10 Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30 at 45 [30]. 11 Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30 at 45 [31]. 12 Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30 at 70 [102]. 13 Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30 at 70 [103]. Bell McHugh J accepted that had the question in Temwood arisen before 1986, the better construction of the equivalent of s 177(1) would have yielded the result referred to above14. However, his Honour considered that the amendments made in 1986, which effectively inserted the equivalent of s 177(2)(b) ("the 1986 amendments"), changed the category of persons who could claim compensation. Prior to the 1986 amendments, the then s 36(3a) provided that15: "Compensation for injurious affection to any land is payable only once under paragraph (a) of subsection (3) of this section and is payable to the person who was the owner of the land at the date of reservation referred to in that paragraph …" (emphasis added) In 198616, the part emphasised became, with a few minor changes, par (a) of s 36(3a). It referred to compensation payable under s 36(3)(a), which is the equivalent of s 177(1)(a). There was then inserted a par (b) into s 36(3a), in essentially the same terms as s 177(2)(b), which is set out above. It referred to compensation payable under the equivalent of s 177(1)(b) and provided that it is payable to "the person who was the owner of the land at the date of application". It may be observed that the equivalent to s 173(1) was not amended at the time the equivalent of s 177(2)(b) was inserted. The respondents contend that these amendments must be taken to acknowledge that the owner of the land at the date of application for development approval may be a different person from the person who was the owner of the land at the date of reservation. It may be inferred that Gummow and Hayne JJ did not consider that the equivalent of s 177(2)(b) had any effect on the operation of the statutory scheme. It did not entitle a subsequent purchaser, such as the developer in that case, to claim compensation. Their Honours considered that its inclusion might simply accommodate special situations, such as the death of the owner before sale or development applications made by those taking the land by testamentary or 14 Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30 at 47-48 [37]. 15 Metropolitan Region Town Planning Scheme Act 1959-1982 (WA), s 36(3a). 16 Metropolitan Region Town Planning Scheme Amendment Act 1986 (WA), s 9. Bell intestate succession17, but that par (b) did not have any application where there has been a sale by the owner as indicated in par (a). McHugh J, on the other hand, considered18 that the inclusion of the provision meant that the equivalent of s 173(1) could no longer operate to confine the persons entitled to receive compensation. In his Honour's view, the equivalent provision to s 177(2)(b) must be given effect in its terms, which apply it to a subsequent owner. His Honour considered19 it to be an unlikely construction that that provision would operate only where the owner at the date of reservation made a development application or where land was conveyed other than by sale, for example by will or operation of law. In his Honour's view, a purchaser who was not the owner at the date of reservation and whose development application was refused or was approved subject to unacceptable conditions may be entitled to compensation, for otherwise the words "owner of the land at the date of application" would have little scope for operation. His Honour concluded that the provision must be regarded as giving an independent claim of compensation unrelated to the fact of ownership at the date when the scheme was made. McHugh J does not appear to have considered how this construction of the equivalent of s 177(2)(b), extending the right to claim compensation, is conformable with the terms and effect of the equivalent of s 173(1). Callinan J did and held20 that the provision equivalent to s 173(1) should not be read as confined to persons who actually owned the land at the time the scheme was made. Gummow and Hayne JJ rejected such a construction. Their Honours considered that the equivalent of s 173(1), and the words "by the making of" appearing in it, controlled the provisions which followed21. 17 Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30 at 71 [108]. 18 Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30 at 48 [38]. 19 Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30 at 48-49 [40]. 20 Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30 at 89-90 [161]. 21 Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30 at 70 [102]. Bell The courts below The primary judge adopted the approach of McHugh J to the construction of s 177(2). Beech J held22 that s 177(1) and (2), read together, provided for two alternative, independent rights to compensation. Further, in defining, in s 177(2)(b), the class of persons who might claim compensation under s 177(1)(b), Parliament had specifically chosen to distinguish the position under s 177(1)(a), so as to include a person who is the owner at the date of the development application but who need not have been the owner at the date of reservation23. The Court of Appeal upheld that decision. Martin CJ, with whom Newnes JA and Murphy JA agreed, said24 that s 177(2) is specifically directed to the identification of the person entitled to claim compensation. It expressly refers to the entitlement of two classes of persons: the owner at the date of the reservation; and the owner at the date of an application for development approval which is refused or is approved subject to unacceptable conditions. The construction of the relevant provisions The relevant part of Pt 11 has a discernible structure. The provisions in question deal with different subject matters but are to be read together. Entitlement to compensation There can be no doubt that s 173(1) confers an entitlement to compensation in the event that land is injuriously affected by a planning scheme. It confers an entitlement on the landowner, as evinced by the words "any person whose land". This is confirmed by s 173(3), which provides that "[a] responsible authority may make agreements with owners for the development of their land during the time that the planning scheme or amendment is being prepared". Some such provision for compensation has been provided at least since 192825. That entitlement is provided because the person's land is injuriously affected by "the making or amendment of a planning scheme". These words are reiterated in ss 174(1) and 175. Pursuant to s 174(1)(a), land is injuriously affected if it is reserved for a public purpose. Section 179 acknowledges that the 22 Leith v Western Australian Planning Commission [2014] WASC 499 at [50]. 23 Leith v Western Australian Planning Commission [2014] WASC 499 at [52]. 24 Western Australian Planning Commission v Southregal Pty Ltd (2016) 49 WAR 25 Town Planning and Development Act 1928 (WA), s 11. Bell value of land reserved under a planning scheme may be affected by the existence of the reservation. In Temwood, Gummow and Hayne JJ, adopting what was said by Ipp J (Wallwork and Owen JJ agreeing) in Bond Corporation Pty Ltd v Western Australian Planning Commission26, said27 that the legislation may be seen to recognise that owners of land suffer loss merely by the reservation of land for public purposes, without any action on their part. They suffer loss by way of a reduction in the market value of their land by reason of the reservation. No reference is made in s 173(1) to a person who purchases land which is already affected by a reservation. It does not suggest that anyone but a landowner at the time of reservation will be entitled to compensation. A purchaser does not fall within the description of a person whose land is affected "by the making" of a planning scheme. A purchaser would only be entitled to compensation if there was, subsequent to that person becoming the owner, an amendment of the planning scheme which injuriously affected the purchaser's land. Compensation is payable Section 173(1) provides for an entitlement "to obtain compensation". It does not say it is payable on the event of reservation. Section 177(1) provides the point at which a responsible authority becomes liable to pay compensation. According to that provision, compensation will not be payable "until" either (a) the land is first sold; or (b) a development application is refused or is approved on conditions unacceptable to the applicant. It follows that it is only when one of these three events occurs that a claim may be made for compensation. It appears to us also to follow from the use of the disjunctive "or" that once one of the three events triggers a claim for compensation, the later occurrence of the other two events cannot trigger a further claim, as was held28 by Gummow and Hayne JJ in Temwood. The reference in s 177(2) to 26 (2000) 110 LGERA 179 at 187-188 [34]. 27 Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30 at 68 [95]. 28 Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30 at 70 [103]. Bell compensation being "payable only once" supports this construction29. It further follows that in the present case, since the land has been "first sold" to the respondents, the refusal of their development application cannot trigger a further claim. The respondents submit that this is not a correct construction of s 177(1) and that it requires the words "the first to occur of" to be read into s 177(1). That submission should not be accepted. It is not necessary to read words into s 177(1) for it to operate in the way described. It follows from the structure and language of the provision, as explained above. It is not possible, as the respondents submit, to read the sub-section as allowing a claim for compensation despite the fact that it has been "first sold". The respondents also rely upon what was said by the Court of Appeal with respect to the position of a purchaser from the owner at the time of reservation. Martin CJ considered30 that a purchaser could have a claim to compensation in the event that the vendor had not claimed compensation. In these proceedings, it would appear that the owners of the land at the time of its reservation did not claim compensation when the land was sold to the respondents. Section 177(1) does not identify who may claim compensation. It states three events, one of which will trigger an entitlement to make a claim for compensation. It does not need to identify who may make a claim. Section 173(1) has already done so. The person entitled to obtain compensation is the owner of the land when it is reserved. Reading the words "payable only once", which appear in s 177(2), with s 177(1) does not advance the construction for which the respondents contend. Those words do not convey that compensation must be paid at least once. If one assumes that every owner of land which is reserved will suffer some loss, an assumption which appears to be made by the statute, the fact that an owner might not make a claim for compensation is not comprehended by the statute and it makes no provision for it. Something further needs to be said concerning the persons involved in the events referred to in s 177(1), before turning to s 177(2). 29 Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30 at 71 [108]. 30 Western Australian Planning Commission v Southregal Pty Ltd (2016) 49 WAR Bell The owner of the land at the time that it is reserved is, obviously enough, the person referred to in the first event, that is, the person who may first sell after reservation. The owner may also be the person who makes an application for development on the land which is refused or is approved subject to unacceptable conditions. But s 177(1) also allows for the possibility that another person might be the applicant, a person who is not an owner at all. That possibility arises from the reference in s 177(1)(b)(ii) to the conditions being unacceptable to "the applicant", not the owner. Section 177(3)(b) likewise refers to "the applicant". It is not difficult to understand why these provisions do not assume that only an owner of land could, or would, apply for development approval. Not all landowners could afford to develop their land or wish to bear the cost of an application to develop, particularly over land the subject of a reservation for public purposes. A developer, however, might wish to investigate the likelihood of approval before committing to a purchase. The form provided for such an application under the Peel Region Scheme31 would appear to allow for this possibility, provided that the application was made with the consent of the owner of the land. It is with this understanding, and an understanding of the scheme of the provisions generally, that one approaches s 177(2). "Payable to" and s 177(2)(b) Section 177(2) is not concerned with the identification of persons who may claim compensation. Rather, the purpose of s 177(2) is to identify the person to whom payment is to be made. This identification occurs after a claim is made and the responsible authority has agreed to pay compensation or a determination has been made that it must be paid. It seems to us that s 177(2)(b) is simply concerned to ensure that, whoever was the applicant for development approval, the payment must be made to the owner. In drafting s 177(2) and its predecessor it may have been overlooked that, in reality, the owner referred to in par (b) would in fact be the owner of the land at the date of reservation. A refusal of an application for development or its approval on unacceptable conditions could only trigger a claim for compensation under s 177(1)(b) if the land had not been first sold by the owner at the date of reservation. In that case it would be retained by that owner. It does not seem to us to matter unduly that s 177(2)(b) is not really necessary. The rationale for it – its intended operation – is clear enough. It was intended to ensure that payments were made to owners and not to someone else. 31 Peel Region Scheme (WA), cl 28, Sched 1. Bell It was not intended to extend the category of persons who could make a claim for compensation upon the refusal, or approval on unacceptable conditions, of a development application beyond persons identified by s 173(1). Nothing in the provisions of Pt 11 suggests that a subsequent purchaser of land, rather than its owner at the time of the reservation, was to be a claimant for compensation. The references to "first sold" and "payable only once" point the other way. In the second reading speech of the Bill which, in 1968, added the reference to compensation being payable "only once"32, the responsible Minister said33: "The provision for the payment of compensation in such cases was designed to protect the owner of land at the time the scheme – or an amendment – included land in a reservation so that when he later sells the property he is compensated by the authority if he is unable to realise the full market value. Subsequent purchasers are aware of the scheme provisions at the time of purchase … and would not be at the same disadvantage as the original owner." This statement recognises what may be obvious enough. A purchaser may be taken to be aware of the status of land, as subject to reservation, and may be expected to adjust the purchase price accordingly. This is the loss which the statute predicts the original owner will suffer. The MRTPS Act was relevantly amended again in 1969 to add the words "and is payable to the person who was the owner of the land at the date of reservation"34. Martin CJ in the Court of Appeal35 referred to two – apparently 32 Metropolitan Region Town Planning Scheme Act Amendment Act 1968 (WA), s 3(d). 33 Western Australia, Legislative Council, Parliamentary Debates (Hansard), 3 September 1968 at 754. 34 Metropolitan Region Town Planning Scheme Act Amendment Act 1969 (WA), s 2. 35 Western Australian Planning Commission v Southregal Pty Ltd (2016) 49 WAR Bell conflicting – statements made by the Minister for Town Planning with respect to this amendment. In the second reading speech the Minister36 said that: "Subsequent owners are expected to acquaint themselves with details affecting the land before purchasing", but went on to say: "Such owners are, of course, protected by the provisions relating to development and compensation in the event of an adverse decision by the authority." However, in response to a question from the Deputy Leader of the Opposition in the Legislative Assembly, the Minister for Education confirmed37 that the Bill introducing the amendment: "is designed to ensure that the owner at the time of reservation, and he alone, will be compensated for any loss of value due to reservations." (emphasis added) Up until 1986 the legislation consistently referred only to the owner of land at the time the planning scheme came into effect as entitled to obtain compensation. It was concerned to compensate the owner for what was recognised to be an injurious affection to the land by the planning scheme. The courts below considered that the 1986 amendments changed this position. However, one would have to wonder why Parliament would then suddenly decide to extend that entitlement to subsequent purchasers by permitting them to claim compensation when their development application was refused or subjected to unacceptable conditions. They do not suffer the loss that the original owner has suffered. The circumstances relating to the respondents furnish examples. Southregal and Mr Wee purchased their land for $2.6 million and claim compensation of $51.6 million; Mr Leith paid $1.28 million for his land and now claims $20 million in compensation. There is no background from which it may be inferred that the 1986 amendments had the effect for which the respondents contend and which the 36 Western Australia, Legislative Council, Parliamentary Debates (Hansard), 4 November 1969 at 2098. 37 Western Australia, Legislative Assembly, Parliamentary Debates (Hansard), 12 November 1969 at 2608. Bell courts below held. Further, at the time the Bill which inserted the equivalent of s 177(2)(b) was read the second time, the Minister for Planning said38 that: "The matters provided for in this Bill do not constitute major changes to the present … legislation". This was repeated in the Legislative Council39. The responsible Ministers identified the concern to which the amendments with respect to the payment of compensation were addressed as claims being paid more than once in relation to the same portion of land. A construction of s 177(2)(b) which does not read it as referable to a subsequent purchaser who makes a development application has the advantage of consistency, which, after all, is the primary object of statutory construction40. Sections 173 and 177(1) and (2) may be understood to refer to the owner at the time of reservation as the person entitled to compensation; the person who claims compensation; and the person to whom compensation is paid. The construction favoured by the Court of Appeal, on the other hand, would be productive of inconsistency as between ss 173 and 177(2). Instead of s 173 conferring an entitlement only on the owner at the time of reservation, if s 177(2) is to have the operation which the Court of Appeal held, an entitlement to compensation must be taken somehow to run with the land and pass to the subsequent owner. An argument to that effect was rejected by Gummow and In Temwood, Callinan J implicitly acknowledged that an inconsistency would arise, for his Honour considered it necessary42 to read the equivalent of s 173(1) so as to permit a broadening of the class of claimant. However, the 38 Western Australia, Legislative Assembly, Parliamentary Debates (Hansard), 12 June 1986 at 173. 39 Western Australia, Legislative Council, Parliamentary Debates (Hansard), 2 July 40 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 381 [69]; [1998] HCA 28. 41 Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30 at 69-70 [100]-[102]. 42 Western Australian Planning Commission v Temwood Holdings Pty Ltd (2004) 221 CLR 30 at 89-90 [161]. Bell proper construction of s 177(2)(b) does not necessitate such a drastic step. The opening words of s 173(1) – "Subject to this Part" – do not warrant reading s 173(1) as subject to a provision dealing with another topic. In context, those words merely require that s 173(1) be read with what follows. This is not to say that s 173(1) should be regarded as the controlling provision, as the appellant submits, but simply that it be read with s 177(1) and (2) so that it produces a harmonious result. Lastly, whilst it must be accepted that words chosen by the legislature should be given meaning and endeavours should be made to avoid them being seen as redundant, they should not be given a strained meaning, one at odds with the scheme of the statute. Moreover, it has been recognised more than once that Parliament is sometimes guilty of "surplusage" or even "tautology"43. The possibility that Parliament may not have appreciated that the reference in s 177(2)(b) was not necessary, and was liable to confuse, is not a reason for giving it a literal interpretation44. Conclusion The appeals should be allowed with costs. The orders of the Court of Appeal should be set aside and in lieu thereof it should be ordered that the appeals from the decision of Beech J made on 22 December 2014 be allowed with costs and the answer to the question of law for determination in each Special Case and the declarations made by his Honour be set aside. The question of law stated for determination in each Special Case should be answered "no". The respondents should pay the costs of the hearing before Beech J. 43 Leon Fink Holdings Pty Ltd v Australian Film Commission (1979) 141 CLR 672 at 679; [1979] HCA 26; Commissioners for Special Purposes of Income Tax v Pemsel [1891] AC 531 at 589; see also Beckwith v The Queen (1976) 135 CLR 569 at 574; [1976] HCA 55. 44 See Chu Kheng Lim v Minister for Immigration (1992) 176 CLR 1 at 12; [1992] HCA 64. Nettle Section 177(2) of the Planning and Development Act 2005 (WA) ("the PD Act") stipulates to whom compensation is payable if land is injuriously affected by the making or amendment of a planning scheme reserving land for public purposes. The issue in these appeals is whether s 177(2) of the PD Act affords a right of compensation only to the owner of the land at the time of the land's reservation under the planning scheme or whether s 177(2) also affords an alternative right of compensation to a subsequent purchaser of the injuriously affected land. The judge at first instance (Beech J) and the Court of Appeal of the Supreme Court of Western Australia (Martin CJ, Newnes and Murphy JJA agreeing) held for the latter. For the reasons which follow, we consider that the right of compensation is confined to the former and, on that basis, that the appeals to this Court should be allowed. The facts and relevant legislation are as set out in the reasons of Kiefel and Bell JJ and need not be repeated. Proceedings at first instance At first instance, the following question of law was said to arise in each case from the special case45: "Whether a person to whom s 177(2)(b) of the [PD Act] would otherwise apply can be entitled to compensation pursuant to ss 173 and 177(1)(b) of the PD Act, in circumstances where the land has been sold following the date of the reservation, and where no compensation has previously been paid under s 177(1) of the PD Act." In answering that question, Beech J acknowledged that, "considered in isolation", the natural reading of s 173 is that it provides compensation only to a person who owns land at the time that a planning scheme is made or amended and thereby injuriously affects the land, and requires that the injurious affection must arise from the making or amendment of the planning scheme, as opposed to its existence46. But, his Honour said, to read s 173 as so imposing an unqualified temporal restriction on the entitlement to compensation would be inconsistent with the terms of s 177(2)(b)47: "In defining, in s 177(2)(b), the class of persons entitled to make a claim under s 177(1)(b), Parliament has specifically, and unmistakeably, 45 Leith v Western Australian Planning Commission [2014] WASC 499 at [15]. 46 Leith [2014] WASC 499 at [42]. 47 Leith [2014] WASC 499 at [44], [52]. Nettle chosen to distinguish the position under s 177(1)(a). Under s 177(1)(a), it is those who own at the time of reservation who can claim. Under s 177(1)(b), it is those who own at the time of the development application. The legislature can be taken to know that most owners acquire title by purchase. One of the two alternative triggering events in s 177(1) is the first sale. In those circumstances, if the legislature had intended that: upon the first of the alternative triggering events in s 177(1)(a) and s 177(1)(b), the single right to compensation is exhaustively activated; and thus upon the first sale of the land no further claim for compensation could ever be made; I think it unlikely that the legislature would have chosen to define the class of persons upon whom the right to claim compensation under s 177(1)(b) was conferred by the general words 'the person who was the owner at the date of the application'. In my view, there is no sufficient foundation in s 177, or elsewhere in pt 11 of the PD Act, for treating the general words of s 177(2)(b) as intended to capture only a (relatively small) subset of those within the ambit of the words used, namely only those who acquired title other than by sale. For these reasons, I consider that the breadth and generality of the language of s 177(2)(b) provides strong support for [the respondents'] construction." Beech J concluded48 that the language of s 177(1) and (2) read together is consistent with the creation of two alternative but otherwise independent rights: the first in favour of the owner of the land at the date it is reserved under a planning scheme, being a right to claim compensation when the land is first sold following reservation; and the second in favour of the owner of the land at the date that a development application is made in respect of the land, being a right to claim compensation when and if the application is refused, or granted on unacceptable conditions. Proceedings in the Court of Appeal The reasoning of the Court of Appeal was substantially to the same effect and, in the result, Martin CJ, with whom Newnes and Murphy JJA agreed, held 48 Leith [2014] WASC 499 at [50]. Nettle that Beech J was correct49: on the proper construction of s 177(2)(b) of the PD Act, a person who was not the owner of the land at the time it was reserved for a public purpose, but who acquired the land by purchase after reservation, and who was the owner at the time an application for approval of development on the land was refused, or granted subject to unacceptable conditions, has an entitlement to compensation for injurious affection, provided that compensation arising out of the relevant reservation has not previously been paid. Constructional choice In Western Australian Planning Commission v Temwood Holdings Pty Ltd50, this Court was divided as to the proper construction of s 36(1), (3) and (3a) of the Metropolitan Region Town Planning Scheme Act 1959 (WA) ("the MRTPS Act"). Those provisions were the legislative predecessors of, and in relevant respects identical in their effect to, ss 173 and 177(1) and (2) of the PD Act. Gummow and Hayne JJ held51 that s 36(1)52 established but one entitlement to compensation, which inured in favour only of the owner of the land at the date of the making of a relevant planning scheme, and that the effect of s 36(3) (now, in effect, s 177(1) of the PD Act) was to defer the enforceability of that right until the first to occur of the sale of the land or the rejection, or grant subject to conditions unacceptable to the applicant, of an application for development approval made by the owner of the land. Their Honours reasoned that s 36(3a) (now, in effect, s 177(2) of the PD Act) supported that conclusion. They posited that the reference in s 36(3a)(b) (now, in effect, s 177(2)(b) of the PD Act) to the owner of the land at the date of application "accommodates such special situations as the death by the owner before any sale and the making of a development application by those volunteers taking the land by testamentary or intestate succession from that owner"53, and does not apply to purchasers of the land. 49 Western Australian Planning Commission v Southregal Pty Ltd (2016) 49 WAR 487 at 492 [9], 515-516 [110] per Martin CJ (Newnes and Murphy JJA agreeing at 50 (2004) 221 CLR 30; [2004] HCA 63. 51 Temwood (2004) 221 CLR 30 at 70 [102]-[103]. 52 Section 36(1) incorporated, and provided for the application of, ss 11 and 12 of the Town Planning and Development Act 1928 (WA). 53 Temwood (2004) 221 CLR 30 at 71 [108]. Nettle McHugh J held54, to the contrary, that it was impossible to escape the conclusion that s 36(3a)(b) applied to a subsequent owner, and that there was no reason to confine the class of subsequent owner to those who had obtained ownership otherwise than by purchase of the land. His Honour was of the view55 that Gummow and Hayne JJ's explanation of s 36(3a)(b), as providing for the special situations of testate and intestate succession, was such an "unlikely construction that it must be rejected". McHugh J concluded56 that s 36(3a)(a) and (b) created two independent rights and that there was no reason to think that one of those rights should lapse where the other was not pursued. To similar effect, although for different reasons, Callinan J held57 that, upon its correct construction, s 11(1) of the Town Planning and Development Act 1928 (WA) ("the TPD Act") (which was imported by s 36(1) of the MRTPS Act (see now, s 173 of the PD Act)) did not confine the right to compensation to the owner of the land at the time of a reservation. It afforded a right to compensation to "[a]ny person" whose land was injuriously affected by the making of a planning scheme and, in Callinan J's view, that included any person who owned the land at the time of reservation or subsequently, if affected by its reservation. Callinan J did not accept that s 36(3) should be read as confined to the first to occur of the sale of the land or the rejection, or grant subject to unacceptable conditions, of a development application, but considered that s 36(3a) prevented double or multiple payments58. Heydon J found59 it unnecessary to deal with the point. As Martin CJ observed60 in the Court of Appeal, given the division of opinion in Temwood, it is surprising that the Parliament did not make any change to the form of s 36(3a) of the MRTPS Act when the provision was reconstituted as s 177(2) of the PD Act in 2005. Its retention makes it necessary for this Court now to choose between the competing interpretations of s 36(3a) of the MRTPS Act expressed in Temwood. 54 Temwood (2004) 221 CLR 30 at 48 [38]. 55 Temwood (2004) 221 CLR 30 at 48-49 [40]. 56 Temwood (2004) 221 CLR 30 at 49 [41]. 57 Temwood (2004) 221 CLR 30 at 89-90 [161]. 58 Temwood (2004) 221 CLR 30 at 90-91 [164]-[167]. 59 Temwood (2004) 221 CLR 30 at 95 [180]. 60 Southregal (2016) 49 WAR 487 at 497 [30]. Nettle Standing alone, s 177(1) of the PD Act conveys the meaning that there is but one right to compensation, which inures in favour of a person whose land is injuriously affected by its reservation for a public purpose under a planning scheme and which becomes payable to that person only once upon the first to occur of the two events specified in pars (a) and (b) of s 177(1)61. As will become apparent, that meaning also accords with the legislative predecessors of s 177(1). By contrast, if the purpose of s 177(1) were to create two independent rights to compensation (and assuming that were consistent with the remaining provisions of Pt 11, Div 2 of the PD Act)  as Beech J and the Court of Appeal held to be the case  it is to be expected that s 177(1) would have been drafted in terms that compensation is not payable: under par (a), until the land is first sold following the date of the reservation; and under par (b), until the responsible authority refuses an application made under the planning scheme for approval of development on the land or grants approval of development on the land subject to conditions that are unacceptable to the applicant. Admittedly, as McHugh J identified in Temwood62 in relation to s 36(3a) of the MRTPS Act, the difficulty with construing a provision like s 177(1) as providing for compensation to be payable only once upon the first to occur of the two events specified in pars (a) and (b) of s 177(1) is the difference between the way in which the payee is described in s 177. Section 177(2)(a) provides that, where compensation becomes payable upon the first sale of the land following its reservation under a planning scheme, it is payable to "the owner of the land at the date of reservation". In contrast, s 177(2)(b) provides that, where compensation becomes payable upon refusal, or grant subject to unacceptable conditions, of an application for development approval, it is payable to "the owner of the land at the date of application". The difference might be thought to suggest that the owner of the land at the date of the application for development approval could be a person other than the owner of the land at the date of the reservation of the land. That would create the possibility of compensation consequent upon the refusal, or grant subject to unacceptable conditions, of an application for development approval not becoming payable until after the first sale of the land 61 See and compare Kettering Pty Ltd v Noosa Shire Council (2004) 78 ALJR 1022 at 1028-1029 [28]-[30]; 207 ALR 1 at 9-10; [2004] HCA 33; Temwood (2004) 221 CLR 30 at 70-71 [103]-[108] per Gummow and Hayne JJ. 62 Temwood (2004) 221 CLR 30 at 47-48 [35]-[38]. Nettle following the reservation. But, as will be seen, the history of the legislation and the extrinsic materials demonstrate that that is not the purpose of the provision. History of the legislation  s 177 of the PD Act and its predecessors Consideration of a statutory provision's legislative history, and particularly the provision's predecessors, serves to illuminate the meaning most apt to be attributed to it, especially where its meaning appears equivocal63. The history of this legislation begins with the TPD Act. So far as is relevant, ss 11 and 12 of the TPD Act provided that: "11 (1) Any person whose land or property is injuriously affected by the making of a town planning scheme shall, if such person makes a claim within the time, if any, limited by the scheme (such time not being less than six months after the date when notice of the approval of the scheme is published in the manner prescribed by the regulations), be entitled to obtain compensation in respect thereof from the responsible authority[.] (3) Where a town planning scheme is altered or revoked by an order of the Minister under this Act, any person who has incurred expenditure for the purpose of complying with the scheme shall be entitled to compensation from the responsible authority, in so far as any such expenditure is rendered abortive by reason of the alteration or revocation of the scheme. 12 (1) Where land or property is alleged to be injuriously affected by reason of any provisions contained in a town planning scheme, no compensation shall be payable in respect thereof if or so far as the provisions are also contained in any public general or local Act, or in any order having the force of an Act of Parliament, in operation in the area, or are such as would have been enforceable without compensation, if they had been contained in by-laws lawfully made by the local authority." 63 Beckwith v The Queen (1976) 135 CLR 569 at 578-583 per Mason J; [1976] HCA 55; Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation (1981) 147 CLR 297 at 306 per Gibbs CJ, 310-311 per Stephen J, 319-323 per Mason and Wilson JJ, 324, 334 per Aickin J; [1981] HCA 26. Cf Pearce and Geddes, Statutory Interpretation in Australia, 8th ed (2014) at 88-89 [3.2]. See also Interpretation Act 1984 (WA), s 19(1). Nettle Plainly enough, s 11(1) of the TPD Act created but one right to compensation  a right which inured solely in favour of the owner of the land at the time of the making of the town planning scheme  in respect of injurious affection caused to land by the making of a town planning scheme. That was necessarily implicit in the way in which the provision framed injurious affection as an event coincidental with the making of a town planning scheme the occurrence of which immediately gave rise to a right to compensation in the person "whose land" was affected by the event of injurious affection. As is also apparent, the right to compensation so created was liable to be defeated unless the owner of the land at the time of the making of the town planning scheme made his or her claim for compensation within the time limited by the scheme. The next step was the enactment in 1959 of the MRTPS Act, which established the Metropolitan Region Scheme consequent upon a report commissioned by the Western Australian Government published in 1955 and entitled Plan for the Metropolitan Region: Perth and Fremantle: Western Australia64. Section 36 of the MRTPS Act in effect imported ss 11 and 12 of the TPD Act and applied them to the Metropolitan Region Scheme, in modified form, as follows65: "(1) For the purposes of applying the provisions of sections eleven and twelve of the [TPD] Act to the provisions of the [Metropolitan Region] Scheme, the former provisions shall be read and construed as if  the [Metropolitan Region Planning] Authority were the 'responsible authority or local authority' wherever referred to in the sections; and the passage, 'varied, amplified or revoked by the Authority' were substituted for the passage, 'altered or revoked by an order of the Minister under this Act' in subsection (3) of section eleven; and those provisions included subsections (3), (4), (5) and (6) of this section. 64 Stephenson and Hepburn, Plan for the Metropolitan Region: Perth and Fremantle: Western Australia, (1955). 65 As it appeared immediately prior to its amendment in 1968, discussed below at Nettle Subject to subsection (4) of this section, where under the Scheme any land has been reserved for a public purpose, no compensation is payable by the responsible authority for injurious affection to that land alleged to be due to or arising out of such reservation until  the land is first sold following the date of the reservation; or the responsible authority refuses an application made under the Scheme for permission to carry out development on the land or grants permission to carry out development on the land subject to conditions that are unacceptable to the applicant. section  Before compensation is payable under subsection (3) of this (a) where the land is sold, the person lawfully appointed to the compensation shall be the amount of determine satisfied  (iii) that the owner of the land has sold the land at a lesser price than he might reasonably have expected to receive had there been no reservation of the land under the Scheme; that the owner before selling the land gave notice in writing to the responsible authority of his intention to sell the land; and that the owner sold the land in good faith and took reasonable steps to obtain a fair and reasonable price for the land; or (b) where the responsible authority refuses an application made under the Scheme for permission to carry out development on the land or grants permission to carry out development on the land subject to conditions that are unacceptable to the applicant, the person lawfully appointed to determine the amount of compensation shall be satisfied the application was made in good faith. that (5) A claim for compensation under subsection (3) of this section shall be made at any time within six months after the land is sold or the application for permission to carry out development on the land is refused or the permission is granted subject to conditions that are unacceptable to the applicant. Nettle (6)(a) Subject to this section, the compensation payable for injurious affection due to or arising out of the land being reserved under the scheme for a public purpose, where no part of the land is purchased or acquired by the Authority, shall not exceed the difference between  the value of the land as so affected by the existence of such reservation; and the value of the land as not so affected. (b) The value referred to in subparagraphs (i) and (ii) of paragraph (a) of this subsection shall be assessed as at the date the land is sold as referred to in paragraph (a) of subsection (3) of this section or the date on which the application for permission to carry out development on the land is refused or the permission is granted subject to conditions that are unacceptable to the applicant." In the second reading speech relating to the introduction in 1962 of sub-ss (3)-(5) into s 36 of the MRTPS Act, the Minister explained that the relevant statutory body lacked sufficient immediate resources to compensate all owners whose land might be injuriously affected by the reservation of the large amounts of land which were to be reserved under the Metropolitan Region Scheme. In order to overcome that difficulty, the purpose of s 36(3) was to defer the need to pay compensation until the injurious affection resulting from the reservation of the land came home to the owner upon sale of the land or upon rejection, or grant subject to unacceptable conditions, of an application for development approval66: "It can properly be argued that reservation under the scheme depreciates the value of land. However, the depreciation is, in many cases, hypothetical and becomes real only when the land is sold at a price which reflects this depreciation, or when development is frustrated by a refusal of consent under the scheme. The amendment proposes that compensation for injurious affection be limited to two circumstances: where a sale is effected at a depressed value attributable to reservation under the scheme, or where consent to develop is refused on the ground of reservation under the scheme." 66 Western Australia, Legislative Assembly, Parliamentary Debates (Hansard), 4 September 1962 at 820. Pausing here, the following points may be noted: Nettle By so importing the provisions of s 11(1) of the TPD Act, s 36(1) of the MRTPS Act created a right to compensation  which inured solely in favour of the owner of the land at the time of the making of the relevant town planning scheme  for the injurious affection caused to the owner's land due to or arising out of the making of the scheme. By s 36(3) of the MRTPS Act, the enforceability of the right to compensation so created by s 36(1) was deferred so as not to become "payable" until and unless the land were first sold or the relevant statutory body refused an application for development approval or granted the application on conditions which were unacceptable to the applicant. Because the right to compensation created by s 36(1) inured solely in favour of the owner at the time of the making of the relevant town planning scheme, it was necessarily implicit in s 36(3) that the deferral of the enforceability of that right was a deferral until the first to occur of the first sale of the land following its reservation under the scheme, or a refusal, or grant subject to unacceptable conditions, of an application for development approval. Perforce of s 36(4)(a)(ii), in the case of the sale of the land, compensation was not "payable" unless, before selling the land, the owner gave notice in writing to the responsible authority of the owner's intention to sell the land. Perforce of s 36(6)(b): in the case of a claim for compensation due to or arising out of the sale of the land, compensation was to be assessed as at the date of sale; and in the case of a claim for compensation arising out of an application for approval to carry out development on the land being refused, or being granted subject to conditions unacceptable to the applicant, compensation was to be assessed as at the date of the refusal, or grant subject to unacceptable conditions, of the application. In either case, compensation was not payable unless the owner of the land at the time it was reserved made his or her claim for compensation within six months after the first sale of the land, or after the refusal, or grant subject to unacceptable conditions, of an application for development approval, as required by s 36(5). Nettle Since the owner of the land at the date of the reservation under the scheme was the only person capable of making the first sale of the land following the reservation, he or she was referred to in s 36(4)(a)(i), in relation to a claim for compensation consequent upon that sale, as "the owner of the land". By contrast, since it was possible for a person other than the owner of the land at the date of reservation to make an application for approval to develop the land before the first sale of the land following reservation, s 36(3)(b), (4)(b) and (6)(b) referred, in relation to a claim for compensation consequent upon refusal, or grant subject to unacceptable conditions, of such an application, to conditions that were unacceptable to "the applicant", rather than unacceptable to the owner. In 1968, the MRTPS Act was amended by the Metropolitan Region Town Planning Scheme Act Amendment Act 1968 (WA) ("the 1968 Amendment Act") by, inter alia, the insertion of a new s 36(3a), as follows67: "(3a) Compensation for injurious affection to any land is payable only once under paragraph (a) of subsection (3) of this section, unless after the payment of that compensation further injurious affection to the land results thereafter from an alteration of the existing reservation on the land or the imposition of another reservation thereon." As may be apparent from what has already been said about the history of the legislation, the effect of that amendment was implicit in s 36(3) without the amendment. But, as is clear from the second reading speech concerning the introduction of sub-s (3a), it emerged that there was some doubt about the matter which needed to be resolved68: "[The amendment] clarifies a provision of subsection (3) of section 36. The wording of the present section leaves some doubt as to the intent of the provision, which indicates that compensation for injurious affection does not become payable  in the case of land reserved under the provisions of the metropolitan region scheme  until the land is first sold. The provision for the payment of compensation in such cases was designed to protect the owner of land at the time the scheme  or an 67 Metropolitan Region Town Planning Scheme Act Amendment Act 1968 (WA), s 3(d). 68 Western Australia, Legislative Council, Parliamentary Debates (Hansard), 3 September 1968 at 754. Nettle amendment  included land in a reservation so that when he later sells the property he is compensated by the authority if he is unable to realise the full market value. Subsequent purchasers are aware of the scheme provisions at the time of purchase ... and would not be at the same disadvantage as the original owner." The absence from the second reading speech of any mention of doubt about the identity of the intended payee of compensation consequent upon refusal, or grant subject to unacceptable conditions, of an application for development approval implies that, at that stage, it was not thought that there was any doubt that compensation under s 36(3)(b) was payable only to the person who was the owner of the land at the date of its reservation under the relevant planning scheme. In 1969, s 36(3a) of the MRTPS Act was amended by the Metropolitan Region Town Planning Scheme Act Amendment Act 1969 (WA) ("the 1969 Amendment Act") so as to introduce the following words into the provision (as indicated by italics)69: "Compensation for injurious affection to any land is payable only once under paragraph (a) of subsection (3) of this section and is payable to the person who was the owner of the land at the date of reservation referred to in that paragraph, unless after the payment of that compensation further injurious affection to the land results thereafter from an alteration of the existing reservation on the land or the imposition of another reservation thereon." Once again, it may be appreciated from what has already been said that the effect of this amendment was implicit in s 36(3) prior to the further amendment in 1969, especially following the introduction of s 36(3a) in 1968. But, as was explained in the second reading speech pertaining to the 1969 Amendment Act, some doubt had arisen since the last occasion70: "Last year I introduced an amendment to the Metropolitan Region Town Planning Scheme Act which, among other things, attempted to define more clearly the meaning of 'first sold' as it relates to the payment of compensation for injurious affection. 69 See Metropolitan Region Town Planning Scheme Act Amendment Act 1969 (WA), s 2(b). 70 Western Australia, Legislative Assembly, Parliamentary Debates (Hansard), 6 November 1969 at 2285. Nettle Under section 36 of the Metropolitan Region Town Planning Scheme Act the authority is responsible for the payment of compensation for injurious affection of land reserved under the provisions of the metropolitan region scheme. Payment of this compensation is deferred, however, until either, firstly, the land is first sold after it has been reserved or, secondly, an application to develop it is refused by the authority or, alternatively, approved but with conditions attached which are unacceptable to the owner. The compensation provisions are intended to protect the interest of the owner of land at the time it is reserved and are not intended to be transferable. It devolves upon subsequent owners to acquaint themselves of the details affecting the land before purchasing it. The Crown Law Department is of the opinion that the provisions of the 1968 amendment are capable of a much wider interpretation than the one intended. It appears that as the Act now stands if a seller who is unaware of the provisions of the Act disposes of his property at less than the unaffected market value and fails to claim compensation for injurious affection, then this right passes to the new owner. The original owner is thus deprived of his right to be compensated for loss of value through the The purpose of this amendment is to ensure that reservation. compensation for injurious affection is received only by the person who owned the land at the time of the reservation." (emphasis added) Pausing at that point, it is to be observed that, despite the stated doubts about the meaning of s 36(3a) and, consequently, about the meaning of s 36(3)(a), it was not then suggested that there was any doubt about the meaning of s 36(3)(b). Noting the emphasised sections of the second reading speech last referred to, it appears to have been thought clear that compensation was payable under s 36(3)(b) only in relation to a refusal, or grant subject to unacceptable conditions, of a development application lodged before the date of the first sale of the land following reservation and, in that event, only to the person who was the owner of the land at the date of reservation. In 1986, s 36 of the MRTPS Act was further amended by the Metropolitan Region Town Planning Scheme Amendment Act 1986 (WA) ("the 1986 Amendment Act") as follows71: 71 Metropolitan Region Town Planning Scheme Amendment Act 1986 (WA), s 9. Nettle "Section 36 of the [MRTPS] Act is amended by repealing subsection (3a) and substituting the following subsection  '(3a) Compensation for injurious affection to any land is payable only once under subsection (3) and is so payable  under paragraph (a) of that subsection to the person who was the owner of the land at the date of reservation; or under paragraph (b) of that subsection to the person who was the owner of the land at the date of application, referred to in that paragraph, unless after the payment of that compensation further injurious affection to the land results from  an alteration of the existing reservation thereof; or the imposition of another reservation thereon.'" As was earlier noticed72, standing alone, s 36(3a) as so amended could perhaps be read as signifying that the person referred to in s 36(3a)(a) as "the person who was the owner of the land at the date of reservation" need not be the same person as the person referred to in s 36(3a)(b) as "the person who was the owner of the land at the date of application". But if that were so, it would have meant that, as a result of the 1986 amendment to s 36(3a), the effect of s 36(3) also had been changed with effect that, thenceforth, if the owner of the land at the date of reservation did not claim compensation under s 36(3)(a) or (b), a subsequent purchaser of the land could claim compensation under s 36(3)(b). Read against the background of the legislative history that has been referred to, that presents as most unlikely. If it had been so, it would have meant that the amendment had worked a fundamental change to the central concept of s 36(1) (that the right to compensation for which it provides should inure solely to the benefit of a person who was the owner of land at the date of the making of a town planning scheme) and further a fundamental change to the central concept of s 36(3) (that the enforceability of the right to compensation for which s 36(1) provides should be deferred until the first to occur of the first sale of the land following its reservation under a scheme or the refusal, or grant subject to unacceptable conditions, of an application for development approval). There is, however, 72 See [68] above. Nettle nothing otherwise about the 1986 Amendment Act which suggests that its purpose was to make fundamental changes to the MRTPS Act and, so far as may be relevant, the second reading speech relating to the 1986 Amendment Act expressly states to the contrary73: "The matters provided for in this Bill do not constitute major changes to the present metropolitan region scheme legislation but they are part of the Government's comprehensive package of initiatives for speeding up and improving the statutory planning process. ... [I]t is proposed to amend the Act in relation to the payment of compensation for land which has been reserved under the metropolitan region scheme so that it is clear that compensation for injurious affection is paid only once to the person who is the owner at the date of reservation when the land is first sold following the date of reservation; or the person who is the owner at the time when the responsible authority refuses an application for development on the land or grants permission subject to conditions which are unacceptable to the owner. At present there is uncertainty about claims being able to be paid more than once in respect of the same portion of land." (emphasis added) Admittedly, it is not entirely clear what other purpose the drafter of the 1986 Amendment Act had in mind in drawing the distinction between "the person who was the owner of the land at the date of reservation" in s 36(3a)(a) and "the person who was the owner of the land at the date of application" in s 36(3a)(b). But, if the object of the exercise had been to create two independent rights to compensation, to amend s 36(3a) in the way that was done would have been a very odd way of going about it. For, as has been emphasised, prior to 1986, the only right to compensation was the right to compensation created by s 36(1) (read in conjunction with s 11 of the TPD Act), which inured solely in favour of the owner of the land at the time of the making of the relevant planning scheme. Thus, it is clear that until 1986 the sole function of s 36(3) (read in conjunction with s 36(3a)) was to defer the enforceability of the right created by s 36(1) until the first to occur following the reservation of the land under a scheme of the sale of the land or the rejection, or grant subject to unacceptable conditions, of a development application. Accordingly, if the purpose of the 1986 amendment to s 36(3a) had been to create a new right in favour of a subsequent purchaser  that is, a right in favour of a subsequent purchaser to compensation consequent upon an unsuccessful application for development approval lodged by the subsequent purchaser after the first sale of the land  it is 73 Western Australia, Legislative Council, Parliamentary Debates (Hansard), 2 July Nettle only to be expected that the 1986 Amendment Act would have been directed to restructuring the right-creating provisions of s 36(1), rather than amending the deferment-of-enforceability provisions of s 36(3a) while making no change to If, however, the purpose of the 1986 amendment were merely to emphasise that the enforceability of the right to compensation created by s 36(1) was deferred until the first to occur of a sale of the land and a rejection, or grant subject to unacceptable conditions, of a development application  as was stated to be the case in the second reading speech  it makes evident sense that the amendment was confined to the deferment-of-enforceability provisions of s 36(3a) and made no change to the right-creating provisions of s 36(1). No doubt the purpose of so emphasising the deferment of the right to compensation could have been achieved without drawing the distinction in s 36(3a) between the "owner of the land at the date of reservation" and the "owner of the land at the date of application". But it will be recalled74 that, even as it stood prior to the 1968 Amendment Act, and certainly at each point afterwards until the 1986 Amendment Act, s 36 drew a comparable distinction. Since the owner of the land at the date of reservation was understood to be the only person capable of making the first sale of the land following reservation, he or she was referred to in s 36(4)(a)(i) (in relation to a claim for compensation consequent upon the first sale of the land following the reservation) simply as "the owner of the land". By contrast, since it was possible for a person other than the owner of the land at the date of reservation to make an application for development approval before the first sale of the land following reservation, s 36(3)(b), (4)(b) and (6)(b) referred to "the applicant", rather than the owner, in relation to a claim for compensation consequent upon a refusal, or grant subject to unacceptable conditions, of such an application. The distinction drawn in s 36(3a) as amended by the 1986 Amendment Act  between the owner of the land at the date of reservation and the owner of the land at the date of application  is consistent with that approach and more generally with the history of the legislation. More particularly, when s 36(3a) was amended in 1969, the fact that compensation consequent upon the first sale of the land following reservation was payable only to the owner of the land at the date of reservation was emphasised by an express statement to that effect. The fact that a corresponding amendment was not made in relation to compensation arising from an anterior rejection, or grant subject to unacceptable conditions, of an application for development approval implied that, at least at that stage, it was not considered to 74 See [73] above. Nettle be in doubt that compensation of the latter variety was payable only to the owner of the land at the date of reservation. As a result, when in 1986 it was decided that an amendment was required to make that position clearer (as was stated to be the case in the second reading speech pertaining to the 1986 Amendment Act) it appears most likely that the reason the drafter referred in s 36(3a)(b) to "the person who was the owner of the land at the date of application" was to recognise that a person other than the owner of the land at the date of reservation was capable of making a development application in relation to the land before the first sale of the land, and, therefore, to make clear that, in the event of such an application being made, compensation would be payable to the owner of the land at the date of application, rather than to the applicant. As counsel for the appellant emphasised in argument, it had been commonplace since at least 1963 for an owner of land to allow a prospective purchaser of the land to apply for development approval in order to assess the development potential of the land. If such an application were successful, the sale price could then be structured accordingly and, in that event, there would be no occasion for compensation. If the application were unsuccessful, the owner might then claim compensation under s 36(3)(b) without proceeding to sale. Hence it appears that the purpose of s 36(3a)(b) was to stress that the compensation would be payable to the "owner of the land at the date of application" rather than to the "applicant". A further and related reason to draw such a distinction between the owner at the date of reservation and the owner at the date of application was that the expression "owner of the land at the date of application" aligned with the circumstance that, under s 36(6)(b), the amount of compensation payable pursuant to s 36(3)(b) was to be assessed as at the date on which the application was refused, or granted subject to conditions unacceptable to the applicant. Yet another reason might have been that, because s 36(3a)(a) provided that compensation arising upon the first sale of the land following reservation was payable to the owner of the land at the date of reservation (in contradistinction to the owner of the land at the date of sale), and by that means excluded the possibility of compensation being payable to the purchaser, consistency of approach was that s 36(3a)(b) should provide for compensation payable to the owner of the land at the date of application (in contradistinction to the owner of the land as at the date of rejection, or grant subject to unacceptable conditions, of the application), and by that means to exclude the possibility of compensation being payable to a purchaser under a contract of sale made between the date of application and the date of refusal, or grant subject to unacceptable conditions, of the application. to require thought As was earlier observed, in Temwood Gummow and Hayne JJ posited that the reason for the distinction between "owner" in s 36(3a)(a) and (b) was to make specific provision for the testate and intestate successors of the owner of the land Nettle at the date of reservation75. McHugh J regarded that idea as untenable76; and, with respect, it is difficult to defend. The improbability of the purpose of the distinction being to provide for testate and intestate succession is illustrated by the circumstance recognised by Beech J and the Court of Appeal77 that, although the testate and intestate successors of the owner of the land at the date of reservation would be able to claim compensation in the event of the refusal, or grant subject to unacceptable conditions, of a development application, they would be denied the right to claim compensation upon the first sale of the land. There is no logic in that. Alternatively, if it is to be assumed that "the person who was the owner of the land at the date of reservation" includes the testate and intestate successors in title of the person who was the legal owner of the land at the date of reservation, the distinction would be pointless. It remains, however, that, because there were other logical and more compelling reasons for the drafter of the 1986 Amendment Act to draw a distinction between the owner at the date of reservation and the owner at the date of application, there is good reason to eschew a construction of the amendment to s 36(3a) that would have brought about a fundamental change in the structure of the compensation provisions of the MRTPS Act. Viewed against the history of the legislation, it is very much more probable, and therefore the preferable construction, that the amendment proceeded from the assumption implicit in the MRTPS Act from its inception that the right to compensation identified in s 36(3)(b) could only ever arise in the event of an unsuccessful development application lodged before the first sale of the land following reservation and, in that event, compensation would be payable to the owner of the land, rather than the applicant for development approval. Is that sufficient reason to prefer the meaning of s 36(3a) identified by Gummow and Hayne JJ to the meaning identified by McHugh J? Counsel for the respondents submitted that to construe the legislation in the manner identified by Gummow and Hayne JJ would require reading in a large number of words or reading the terms of the legislation otherwise than according to their natural and ordinary meaning. That is not so. It is true that, according to orthodox statutory interpretation principles, the difference between the expressions "owner of the land at the date of reservation" and "owner of the land at the date of application" prima facie suggests that each expression has a different meaning. But, given that the right to compensation created by s 36(1) was the right to compensation 75 Temwood (2004) 221 CLR 30 at 71 [108]. 76 Temwood (2004) 221 CLR 30 at 48-49 [40]. 77 Leith [2014] WASC 499 at [51]-[52]; Southregal (2016) 49 WAR 487 at 510-511 Nettle under s 11(1) of the TPD Act (as modified by s 36(1) and following provisions), which inured solely for the benefit of the owner of land at the time the relevant planning scheme was made, it logically accords with the scheme of the legislation and is not repugnant to the natural and ordinary meaning of the text to construe the difference between the two expressions as denoting no more than the two different circumstances in which compensation was payable to the person who was the owner of the land at the time it was reserved for a public purpose under a planning scheme: either the first sale of the land following reservation (hence, "the owner of the land at the date of reservation"); or, if an application for development approval were lodged before the first sale of the land following reservation, rejection, or grant subject to unacceptable conditions, of that application (hence, "the owner of the land at the date of application"). Counsel for the respondents further submitted that to construe the legislation in the manner identified by Gummow and Hayne JJ would lead to the irrational consequence that, if a person who was an owner of land at the date of reservation entered into a contract for sale of the land which remained uncompleted at the date of reservation, the owner of the land at the date of reservation would receive the benefit of having sold the land at a pre-reservation price, and yet would be entitled to claim compensation, whereas the purchaser, who agreed to pay a pre-reservation price, would be precluded from claiming compensation. By contrast, it was said that, if the provisions were construed as creating two independent rights to compensation in the manner identified by McHugh J, it would conduce to the more just and, therefore, more likely intended result that the purchaser would be entitled to claim compensation. But that submission is not persuasive either. Assuming the facts were as suggested, the vendor would have been the owner of the land at the date of reservation and the only person entitled to claim compensation under s 36. Although a purchaser under an uncompleted contract of sale of land has an equitable interest in the land, or at least acquires an equitable interest in the land once the contract becomes enforceable by specific performance78, the way in which s 36 referred to the owner and provided for payment of compensation only once signifies that what was meant by "the owner of the land" was the legal owner of the land79. But it is unlikely that an owner of land would have been able to sell the land at a pre-reservation price so shortly 78 Chang v Registrar of Titles (1976) 137 CLR 177 at 184-185 per Mason J, 189-190 per Jacobs J; [1976] HCA 1. 79 Bond Corporation Pty Ltd v Western Australian Planning Commission (2000) 110 LGERA 179 at 188 [37] per Ipp J (Wallwork and Owen JJ agreeing at 191 [58], Nettle before the land was to be reserved that the contract of sale would remain uncompleted at the date of reservation. (The notice provisions of the MRTPS Act meant that the possibility of reservation would have been announced long before the date of reservation80.) And, even if that did occur, the amount of compensation payable to the owner under s 36(3)(a) would have been nil. Section 36(6) capped the amount of compensation payable at the difference between the values of the land as unaffected by the reservation and the land as so affected, and, ex hypothesi, the owner would have received under the contract the value of the land as unaffected. Certainly, in those circumstances, the purchaser would have had no right to compensation. But, as was submitted in the course of argument, the only circumstance in which a purchaser would have need of compensation would be where the purchaser had failed to undertake the kinds of inquiries which the Parliament considered ought ordinarily to be undertaken and if undertaken would have revealed that the land was likely to be reserved81. As was noticed in the second reading speech pertaining to the 1968 Amendment Act, purchasers are aware of the scheme provisions at the time of purchase and are not at the same disadvantage as the original owner. When the PD Act was enacted in 2005, it had as one of its objects consolidation of the MRTPS Act and the TPD Act82. Consequently, as has been seen, Div 2 of Pt 11 of the PD Act (ss 172-183) appears in substantially identical terms to the comparable provisions of the MRTPS Act and the TPD Act. It is accepted that mutatis mutandis the provisions of the PD Act are to be construed as having the same effect as the predecessor provisions83. It follows that s 177(2)(b) is to be construed as having the same operation as s 36(3a)(b) of the MRTPS Act. Conclusion For these reasons, we consider that the appeals should be allowed with costs and agree with the orders proposed by Kiefel and Bell JJ. 80 Metropolitan Region Town Planning Scheme Act 1959 (WA), ss 33(2)(b), (c), (e), (h), (i), 33A(2)(b), (c) and (8)(a). See also Planning and Development Act 2005 (WA), ss 43, 54, 58. 81 See [78] above. 82 Planning and Development Act, s 3(1)(a). 83 Planning and Development Act, s 3(2). KEANE J. The Peel Region Scheme ("the PRS") came into effect in Western Australia on 20 March 2003. The PRS reserved certain land within the scheme area for public purposes, as regional open space. After the PRS came into effect, the respondents in both appeals became the owners of parcels of land within the PRS area. Southregal Pty Ltd and Mr Wee entered into a contract to purchase their land before the PRS came into force, but settlement of that contract did not occur. They entered into a new contract, which subsequently settled, after the PRS came into force. Mr Leith made, and completed, a contract to buy his land after the PRS came into force. The respondents applied to the appellant in each appeal ("the Planning Commission") for development approval in respect of their land. Their applications were refused by the Planning Commission and the respondents claimed compensation for injurious affection. It was common ground that, although the PRS came into effect before the enactment of the Planning and Development Act 2005 (WA) ("the Act"), by virtue of the Planning and Development (Consequential and Transitional Provisions) Act 2005 (WA) the respondents' claims for compensation for injurious affection were to be determined under Pt 11 of the Act84. The claimants contended that compensation was payable to them under s 177(2)(b) of the Act, as the persons who were the owners of the land at the time that the applications for development approval were refused. The Planning Commission declined each claim for compensation on the basis that none of the claimants was a "person whose land is injuriously affected by the making ... of a planning scheme" within s 173(1) of the Act, in that none of the claimants was the owner of land affected by the PRS at the time it came into force. Pursuant to s 176 of the Act, the claimants commenced arbitration proceedings in respect of their claims for compensation. By consent of the parties, special cases were stated for the determination of a question of law by the Supreme Court of Western Australia. The question, as reformulated by the primary judge, was: "Whether a person to whom s 177(2)(b) of [the Act] would otherwise apply can be entitled to compensation pursuant to ss 173 and 177(1)(b) of [the Act], in circumstances where the land has been sold following the 84 Leith v Western Australian Planning Commission [2014] WASC 499 at [7]-[9]. It is convenient henceforth to refer to the respondents in both appeals compendiously as "the claimants". date of the reservation, and where no compensation has previously been paid under s 177(1) of [the Act]."85 The question was resolved in the claimants' favour, by both the primary the Court of Appeal (Martin CJ, Newnes and judge (Beech J)86 and It may be noted that the final formulation of the question reflected the Planning Commission's insistence that it was irrelevant that there had not been a claim for compensation by the person who was the owner of each parcel of land at the time the PRS came into effect88. Given the position taken by the Planning Commission, and the absence of any suggestion in the record that the owners of the claimants' parcels of land at the time the PRS came into effect have made a claim for compensation under the Act, one may fairly approach the question posed for determination on the basis that the persons who sold the land to the claimants made no claim for compensation under the Act. For the sake of completeness, it may also be noted that an issue between the parties as to whether the interest of two of the claimants, Southregal and Mr Wee, in the land under their contract at the time of the reservation was sufficient to entitle them to claim compensation was hived off for separate determination after the resolution of the present appeals89. The focus of attention in this Court, as in the Courts below, was upon the interrelation between ss 173(1) and 177 of the Act. It is convenient to turn now to summarise those provisions, and the context in which they appear in Div 2 of Pt 11 of the Act. 85 Leith v Western Australian Planning Commission [2014] WASC 499 at [15]. 86 Leith v Western Australian Planning Commission [2014] WASC 499. 87 Western Australian Planning Commission v Southregal Pty Ltd (2016) 49 WAR 88 Leith v Western Australian Planning Commission [2014] WASC 499 at [12]-[15]. 89 Western Australian Planning Commission v Southregal Pty Ltd (2016) 49 WAR The Act Section 171(1) of the Act provides that: "If compensation has been paid under a provision of this Part in relation to a matter or thing no further compensation is payable under any other provision of this Act as a result of the same matter or thing." Section 173 of the Act relevantly provides: "(1) Subject to this Part any person whose land is injuriously affected by the making or amendment of a planning scheme is entitled to obtain compensation in respect of the injurious affection from the responsible authority. (2) Despite subsection (1) a person to obtain compensation under this section on account of any building erected, or any contract made, or other thing done with respect to land included in a planning scheme after the date of the approval of a planning scheme or amendment … is not entitled (3) A responsible authority may make agreements with owners for the development of their land during the time that the planning scheme or amendment is being prepared." By virtue of s 4(1) of the Act, the Planning Commission is a "responsible authority" for the purposes of s 173, and the term "land" is defined to include "any interest in land". The Planning Commission contended that s 173 creates an entitlement to compensation for injurious affection at the moment in time when the planning scheme comes into force, and that this entitlement arises exclusively in favour of the then owner of the land, so that a person who purchases affected land has no entitlement to compensation under the Act. It is convenient to note here that s 173(3) speaks expressly of "owners" during the time before the planning scheme actually comes into force. This express reference to owners during that period of time may be contrasted with the more expansive reference in s 173(1) to "any person whose land is injuriously affected by the making or amendment of a planning scheme" unconfined by an express temporal association with respect to the coming into force of the planning scheme. Section 174 explains what s 173 means when it speaks of land being injuriously affected by the making or amendment of a planning scheme. It relevantly provides: ... [L]and is injuriously affected by reason of the making or amendment of a planning scheme if, and only if – that land is reserved (whether before or after the coming into operation of this section) under the planning scheme for a public purpose; the scheme permits development on that land for no purpose other than a public purpose; or the scheme prohibits wholly or partially – the continuance of any non-conforming use of that land; or the erection, alteration or extension on the land of any building in connection with or in furtherance of, any non-conforming use of the land, which, but for that prohibition, would not have been an unlawful erection, alteration or extension under the laws of the State or the local laws of the local government within whose district the land is situated." The injurious affection of relevance in this case is described in s 174(1)(a). It should be noted that the reservation in question did not involve restrictions on development or use of the kind referred to in s 174(1)(b) or (c). It may also be noted that s 174 contains an express provision as to its temporal operation. Section 176(2) provides for the determination by arbitration of "[a]ny question as to the amount and manner of payment … of the sum which is to be paid as compensation under [Div 2]". Section 177 provides: "(1) Subject to subsection (3), when under a planning scheme any land has been reserved for a public purpose, no compensation is payable by the responsible authority for injurious affection to that land alleged to be due to or arising out of such reservation until – the land is first sold following the date of the reservation; or the responsible authority – refuses an application made under the planning scheme for approval of development on the land; or grants approval of development on the land subject to conditions that are unacceptable to the applicant. Compensation for injurious affection to any land is payable only once under subsection (1) and is so payable – under subsection (1)(a) to the person who was the owner of the land at subsection (1)(a); or the date of reservation referred under subsection (1)(b) to the person who was the owner of the land at subsection (1)(b), the date of application referred unless after the payment of that compensation further injurious affection to the land results from – an alteration of the existing reservation of the land; or the imposition of another reservation of the land. Before compensation is payable under subsection (1) – (a) when the land is sold, the person lawfully appointed under section 176 to determine the amount of the compensation is to be satisfied that – the owner of the land has sold the land at a lesser price than the owner might reasonably have expected to receive had there been no reservation of the land under the planning scheme; the owner before selling the land gave written notice to the responsible authority of the owner's intention to sell the land; and (iii) the owner sold the land in good faith and took reasonable steps to obtain a fair and reasonable price for the land; (b) when the responsible authority refuses an application made under the planning scheme for approval of development on the land or grants approval of development on the land subject to conditions that are unacceptable to the applicant, the person lawfully appointed under section 176 determine the amount of the compensation is to be satisfied that the application was made in good faith." Section 177(2)(b) is the provision which is the nub of the Planning Commission's difficulty in this case. It expressly provides that compensation is payable to the person who is the owner of affected land at a time after the reservation has come into effect. The provision thus applies literally to persons such as the claimants. To uphold the Planning Commission's argument would be to deny s 177(2)(b) its literal operation. The Planning Commission suggested that the purpose of s 177(2)(b) is to ensure that it is the owner of the land, rather than the applicant for development approval, to whom compensation is payable. That may well be so, but that suggestion does not explain how the language used in s 177(2)(b) is consistent with the Planning Commission's contention that the owner of the land referred to in s 177(2)(b) is the same person as the owner of the land referred to in s 177(2)(a). time Section 178 provides for compensation may be made. It provides: limits within which a claim for "(1) A claim for compensation for injurious affection to land by the making or amendment of a planning scheme is to be made – in the case of a claim in respect of injurious affection referred to in section 174(1)(a) or (b), at any time within 6 months after – the land is sold; the application for approval of development on the land is refused; or (iii) the approval is granted subject to conditions that are unacceptable to the applicant; in the case of a claim in respect of injurious affection referred to in section 174(1)(c), within the time, if any, limited by the planning scheme. The time limited by a planning scheme under subsection (1)(b) is to be not less than 6 months after the date when notice of the approval of the scheme is published in the manner prescribed by the regulations." Section 179 sets limits on the amount of compensation which may be paid for injurious affection arising out of the reservation of land for public purposes. Section 179(1) relevantly provides that: "the compensation payable for injurious affection due to or arising out of the land being reserved under a planning scheme … is not to exceed the difference between – the value of the land as so affected by the existence of such reservation; and the value of the land as not so affected." Section 179(2) provides that these two values are to be assessed as at the date on which: the land is sold as referred to in section 178(1)(a); the application for approval of development on the land is refused; the approval is granted subject to conditions that are unacceptable to the applicant." Section 181 of the Act should also be noted. It provides that a responsible authority may recover compensation from an owner of land to whom compensation for injurious affection to land has been paid if a reservation is revoked or reduced. It entitles a responsible authority to recover a refund, determined as a proportion of the value of the land as at the date on which the refund becomes payable. It is relevant to note that the section operates where compensation for injurious affection to land has been "paid to an owner of land in the circumstances set out in section 177" (emphasis added). In this way, s 181 acknowledges that compensation under s 177(2) is payable to an owner of affected land who may not have been the owner of the land at the date a reservation for public purposes came into effect. The primary judge The primary judge accepted that the "natural" meaning of s 173(1), considered in isolation, is that only a person who owned the land at the date it became injuriously affected is eligible for compensation90. However, his Honour 90 Leith v Western Australian Planning Commission [2014] WASC 499 at [42]-[43]. considered that to read s 173 as imposing an unqualified temporal restriction on the entitlement to compensation would not be consistent with s 177(2)(b)91. The primary judge considered that s 177(2)(b) expressly contemplates that compensation payable under s 177(1)(b) is not restricted to the person who was the owner at the time of the making or amendment of a planning scheme92. His Honour did not accept that the unqualified language of s 177(2)(b) encompasses only those successors in title of the owner at the time of the making of a planning scheme who acquire title otherwise than by sale by that owner93. The Court of Appeal In the Court of Appeal, Martin CJ, with whom Newnes and Murphy JJA agreed, acknowledged that, read in isolation, s 173 is capable of supporting the construction for which the Planning Commission contended; however, his Honour held that s 173 must be read in the context of the Act as a whole94. In this regard, his Honour noted95 that the construction advanced by the Planning Commission could be accepted only if the ordinary effect of the words of s 177 was constrained by limitations not found in the actual words of the Act. Martin CJ rejected the Planning Commission's suggestion that s 177(2)(b) confers an entitlement to compensation only upon a person who obtains ownership of the land through succession or intestacy from the owner at the time the planning scheme came into force96. His Honour noted97 that there was nothing in s 177(2), or in any of the secondary materials, which would suggest that this was the legislature's intention, and there was no reason in public policy why such a distinction would be intended. 91 Leith v Western Australian Planning Commission [2014] WASC 499 at [44]. 92 Leith v Western Australian Planning Commission [2014] WASC 499 at [44]. 93 Leith v Western Australian Planning Commission [2014] WASC 499 at [52]. 94 Western Australian Planning Commission v Southregal Pty Ltd (2016) 49 WAR 95 Western Australian Planning Commission v Southregal Pty Ltd (2016) 49 WAR 96 Western Australian Planning Commission v Southregal Pty Ltd (2016) 49 WAR 97 Western Australian Planning Commission v Southregal Pty Ltd (2016) 49 WAR The appeals to this Court The Planning Commission contended that s 177(2)(b) should not be given its literal meaning but should be construed on the basis that its reference to the person who was the owner of the land at the date of the application referred to in s 177(1)(b) should be understood as referring exclusively to the person who was the owner of the land at the date of reservation. The construction of s 177(2)(b) urged by the Planning Commission does in Marshall v not accord with Director General, Department of Transport98, where her Honour said: the approach described by Gaudron J "The right to compensation for injurious affection following upon the resumption of land is an important [property] right … and statutory provisions conferring such a right should be construed with all the generality that their words permit. Certainly, such provisions should not be construed on the basis that the right to compensation is subject to limitations or qualifications which are not found in the terms of the statute." This approach to construction was approved by McHugh, Gummow, Hayne, Callinan and Heydon JJ in Kettering Pty Ltd v Noosa Shire Council99. The Planning Commission urged a departure from a literal reading of s 177(2)(b), with its more expansive view of the right to compensation, by reference to limitations which are not to be found in the terms of the statute. In particular, the Planning Commission relied upon the legislative precursors of s 177, which were said to indicate that s 177, in its current form, has a narrower operation than its literal meaning. That approach not only departs from that supported by Marshall and Kettering, but also requires the drawing of an inference of a legislative intention not to alter the effect of earlier legislation. The drawing of that inference becomes more and more problematic the farther the inference travels from the statutory language used by the legislature. In this case the inference has to travel a long way and to overcome a number of hurdles. For the reasons that follow, I consider that the primary judge and the Court of Appeal were correct to answer the question posed by the parties in the affirmative. That answer best accords with the settled approach to the construction of legislation of this kind and with the text, context and purpose of 98 (2001) 205 CLR 603 at 623 [38]; [2001] HCA 37. 99 (2004) 78 ALJR 1022 at 1029 [31]; 207 ALR 1 at 10; [2004] HCA 33. Pt 11 of the Act100. The reasons which follow address the submissions made by the parties under the following topics: the temporal operation of s 173(1); whether s 173 controls the subsequent provisions of Pt 11; the textual and contextual considerations bearing upon the legal meaning of s 177; and the purpose of s 177. The temporal operation of s 173(1) The Planning Commission submitted that the reference in s 173(1) to "any person whose land is injuriously affected by the making or amendment of a planning scheme" fastens on the impact upon the owner at the time of the making of the scheme to vest exclusively in that owner a right to compensation, rather than looking to the ongoing operation of the scheme upon owners from time to time of land affected by the scheme. the Planning Commission placed particular reliance upon The Planning Commission submitted that, if the mere existence of a planning scheme were sufficient to create an entitlement to compensation, there would be no need for the words "making or amendment of" in s 173(1)101. In this regard, the circumstance that, in Western Australian Planning Commission v Temwood Holdings Pty Ltd102, Gummow and Hayne JJ treated the words "by the making of" in the then statutory equivalent of s 173(1) as suggesting the necessary temporal connection between ownership of land and the making of the planning scheme in order to give rise to an entitlement to compensation. This view did not, however, command the assent of a majority of this Court in Temwood; and so it was not regarded as decisive by the Court of Appeal in this case. In addition, the Court of Appeal did not regard this view as persuasive. Martin CJ said103 that the injurious affection resulting from the making or amendment of a planning scheme may have an effect upon a person who comes to own affected land, which may or may not entitle that person to compensation. The question depends upon the operation of the later provisions of Pt 11, to which s 173 is expressed to be subject. On this view, the relevant question is as 100 See Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27 at 46-47 [47]; [2009] HCA 41; Certain Lloyd's Underwriters v Cross (2012) 248 CLR 378 at 388-390 [23]-[26]; [2012] HCA 56. 101 See Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 382 [71]; [1998] HCA 28. 102 (2004) 221 CLR 30 at 68 [95]-[96]; [2004] HCA 63 ("Temwood"). 103 Western Australian Planning Commission v Southregal Pty Ltd (2016) 49 WAR to the identity of the person entitled to compensation upon the occurrence of the events which crystallise the inchoate entitlement conferred by s 173. Those events are the subject matter of the express provisions of s 177. Murphy JA, in addition to agreeing with Martin CJ, observed that the interpretation advanced by the Planning Commission would "have greater force if s 173(1) used the word 'upon', so that the relevant phrase in s 173(1) read 'upon the making or amendment of a planning scheme'"104. The claimants submitted that, as the Court of Appeal held105, there is no difficulty in reading the reference in each of s 173(1) and s 174(1) to injurious affection arising from "the making or amendment of a planning scheme" as recognition that each occasion on which a planning scheme is made or amended may result in injurious affection for which compensation is to be provided by the Act. The claimants submitted that it would be wrong to treat s 173(1) as having an operation, temporal or otherwise, that is unaffected by the other provisions which inform its meaning (such as s 174) and practical operation (such as s 177). The claimants' submission should be accepted. The temporal operation attributed to s 173(1) by Gummow and Hayne JJ in Temwood depends upon inference from the language in which s 173(1) is expressed. It is significant, in this regard, that within s 173, sub-s (3) is explicit in its temporal operation whereas sub-s (1) is not. Further, the circumstance that s 173(1) creates an entitlement in "any person" is not entirely consistent with the notion that the entitlement is exclusive to the person who is the owner at the time that the planning scheme comes into force. The collocation of s 173(1) and (3) is significant in this regard. The circumstance that s 173(3) expressly refers to "owners" of land while the planning scheme is being prepared, and therefore before it comes into force, suggests that the benefit of s 173(1) is not confined exclusively to owners of affected land at the time the planning scheme comes into force. In addition, the temporal significance placed by the Planning Commission on the circumstance that s 173(1) speaks of land being injuriously affected "by the making" – rather than by the existence – of a planning scheme appears to be overstated, if not misplaced, when one looks at the context in which s 173 appears. In this regard, it may be noted that s 179(1)(a) speaks of the value of land as affected "by the existence" of a reservation under a planning scheme, and not by the making of the planning scheme. 104 Western Australian Planning Commission v Southregal Pty Ltd (2016) 49 WAR 105 Western Australian Planning Commission v Southregal Pty Ltd (2016) 49 WAR More importantly, s 177(2)(b) is explicit in its temporal operation in favour of the person who is the owner of affected land at a time after the reservation has come into force. As noted above, a literal reading of the express provisions of s 177(2)(b) provides an answer to the specific question to be determined. The answer for which the Planning Commission argued can be sustained only if s 173(1) confines, in some way, the scope of the operation of s 177(2)(b). One must, therefore, turn to consider the Planning Commission's submission that s 173(1) controls s 177 so as to deny a literal operation to the latter provision. Section 173(1) controls s 177 The Planning Commission's argument under this rubric commenced with the uncontroversial proposition that, in order to reconcile apparently conflicting provisions of a statute, a court may be required to determine which is the leading provision and which is the subordinate provision and which must give way to the other106. The Planning Commission went on to submit that the effect of s 173(1) is that the meaning of the provisions which follow is controlled by it, because s 173(1) is the leading provision. In Temwood107, Gummow and Hayne JJ said that the opening words of the then statutory equivalent of s 173(1) were "controlling words of what follows". The Planning Commission argued that the sequence of provisions in Div 2 of Pt 11 of the Act supports the "controlling" effect of s 173(1). But while the Planning Commission was able to draw support from what was said by Gummow and Hayne JJ, McHugh and Callinan JJ took a contrary view108. Prior to 1986, s 36(3a) of the Metropolitan Region Town Planning Scheme Act 1959 (WA) ("the MRTPS Act") provided: "Compensation for injurious affection to any land is payable only once under paragraph (a) of subsection (3) of this section and is payable to the person who was the owner of the land at the date of reservation referred to in that paragraph". 106 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 107 (2004) 221 CLR 30 at 70 [102]. 108 Temwood (2004) 221 CLR 30 at 48 [38], 89-92 [161]-[172]. In 1986109, s 36(3a) was repealed and a new sub-section was substituted; the sub-section then provided: "Compensation for injurious affection to any land is payable only once under subsection (3) and is so payable – under paragraph (a) of that subsection to the person who was the owner of the land at the date of reservation; or under paragraph (b) of that subsection to the person who was the owner of the land at the date of application". In Temwood110, McHugh J agreed that the interpretation favoured by Gummow and Hayne JJ represented the better view during the period prior to the 1986 legislative amendments, but considered that the amendments, which added the express reference to development applications now contained in s 177(2)(b), altered the effect of the legislation so that it is "impossible to escape the conclusion … that [the provision] applies to a subsequent owner". The Planning Commission's submission should not be accepted. Section 173(1) begins with the words "Subject to this Part". These words are distinctly inconsistent with the proposition that the later provisions of Pt 11 of the Act are subordinate to and controlled by s 173(1). The introductory words of s 173(1) are consistent with the view that, while s 173(1) gives rise to an inchoate entitlement to compensation for injurious affection, it is necessary to go to the later provisions of Pt 11 to ascertain the nature and extent of that entitlement and its practical effect. Given that the content of the entitlement to compensation which arises under s 173(1) is expressed to be subject to the later provisions of Pt 11, it is hardly surprising that McHugh J concluded in Temwood111 that the effect of the then equivalent of s 173(1) was altered by the enactment of what was to become s 177(2). One cannot resolve the difficulty which s 177(2)(b) poses for the Planning Commission's argument by treating s 173(1) as the controlling provision, which creates a right to compensation exclusive to the owner at the date of reservation, and s 177 as an ancillary provision, which serves no purpose other than to defer the realisation of that right by that owner. 109 Metropolitan Region Town Planning Scheme Amendment Act 1986 (WA), s 9. 110 (2004) 221 CLR 30 at 48 [38]. 111 (2004) 221 CLR 30 at 48 [38]. Section 177: textual considerations The Planning Commission submitted that the reference to "owner" in s 177(2)(b) of the Act, consistently with its view of the exclusivity of the entitlement created by s 173(1), includes a person who obtains ownership of land otherwise than by purchase, for example by testamentary or intestate succession, from the original owner112. It was argued that the use of a different date in s 177(2)(b), the date of a development application, rather than the date of reservation, accommodates the possibility of a successor in title by then having become the owner113. The Planning Commission's attempt to give meaning to s 177(2)(b) as serving to accommodate the position of those owners who obtain property through testamentary or intestate succession is not persuasive. To confine the entitlement to the payment of compensation to those who have obtained property "otherwise than by purchase", and thereby to limit the provision's operation by reading into it words to confine its operation, would be contrary to the orthodox approach to the interpretation of provisions such as this. But in any event, there is no reason why these words would have been used if their only purpose was to cover such successors in title of the owner at the date the reservation came into effect: such persons would have been covered simply by use of the term "owner". The claimants submitted that s 177(2) clearly distinguishes between the entitlement of the owner of the land at the date of reservation and the entitlement of the owner at the date of application for the development approval. It may be that an application might be made for development approval by a person who has not yet become the owner of the land, but that possibility is no reason to disregard, or to confine, the express language in which s 177(2)(b) is expressed. And as will be seen, there was no hint of an intention to confine the scope of s 177(2)(b) in the ministerial statement of purpose which accompanied the enactment of its direct legislative predecessor. The Planning Commission sought to argue that s 177(2)(b), by its reference to the owner of the land at the date of an application for approval, exhibits a concern to ensure that if the application for approval was made by a person who was not, at that time, the owner, compensation would be payable to the owner at that time, even if the applicant subsequently became the owner. The Planning Commission argued that a consequence of the claimants' argument is that contemporaneous applications for compensation may be made by the 112 Temwood (2004) 221 CLR 30 at 71 [108] per Gummow and Hayne JJ. 113 Cf Western Australian Planning Commission v Southregal Pty Ltd (2016) 49 WAR previous owner (arising from the sale) and the new owner (arising from the development application) and the Act contains no provision to resolve such competing claims. The difficulty with this aspect of the argument of the Planning Commission is that the Act, in s 177(2) and (3), addresses the possibility of competing claims by alternative owners. Consistently with s 171(1), sub-ss (2) and (3) of s 177 ensure that compensation is payable only once, and that it will become payable upon the first to occur of the events described in s 177(2). The person described in s 177(2)(a) will be in a position to determine that issue, subject to complying with s 177(3)(a). In the absence of compliance by that person with s 177(3)(a), compensation under s 177(2)(a) can never become payable to that person. As noted above, this case has proceeded on the footing that the owners of the parcels of land in question at the date of reservation did not comply with s 177(3)(a). And so, while s 177(2) may be understood as providing for compensation to be payable upon the first of the events referred to in s 177(2)(a) or (b) to occur, in this case compensation never became payable under s 177(2)(a). The purpose of s 177 is to identify the events upon which compensation is to be payable, and the person to whom it is to be payable. That person is the first person to satisfy the requirements of s 177(3). It is not only the owner of the land at the date of reservation who can satisfy the requirements of s 177(3). A consideration of the context in which s 177 appears is not apt to alter that conclusion. Section 177: contextual considerations The Planning Commission submitted that eligibility for compensation for the two non-reserve forms of injurious affection can stem only from s 173(1), because there is no provision comparable to s 177(2) that applies to s 174(1)(b) and (c). For those types of injurious affection, it was submitted that only the owner at the date of the making or amendment of the scheme is entitled, and a sale of the land necessarily terminates all entitlement. The Planning Commission submitted that s 173(1) cannot have two meanings – a non-temporal meaning for s 174(1)(a) and a temporal meaning for s 174(1)(b) and (c); rather, the natural meaning of s 173(1) controls all eligibility for compensation. Therefore, it was argued, s 173(1) retains its "natural" meaning and controlling status for the purposes of s 174(1)(b) and (c). But, as the claimants noted, s 174 sets out three circumstances in which land is affected by the making or amendment of a planning scheme. In this regard, s 174(1)(a), on the one hand, refers to reservations for public purposes, whereas pars (b) and (c) deal with terms of the planning scheme which have immediate effect on the ability to develop land. It is hardly surprising that the legislation should make different provision for the payment of compensation in respect of the different effects of these different kinds of restrictions upon the value of the interest of an owner in land. Next, s 178(1) provides relevantly that – in a case arising under s 174(1)(a) – a claim for payment of compensation may be made at any time within six months after the events set out in either s 177(1)(a) or (b) have occurred. The Planning Commission argued that it would be anomalous if different claims should be subject to different time limits. The claimants responded that s 178(1)(a) gives rise to the question "a claim by whom", and that that question is answered in different ways by s 177(2)(a) and (b). Section 177(2) expressly provides that compensation is "payable only once under subsection (1)", and defines the persons to whom such compensation may be payable. Those persons fall into two categories, defined by different criteria, being: the person who was the owner at the date of reservation114, where the claim for compensation is based on an entitlement arising under s 177(1)(a) (ie on the first sale after the reservation); and the person who was the owner at the time of the application referred to in s 177(1)(b), where that application was unsuccessful, or granted on conditions unacceptable to that applicant115. That the terms of Pt 11 refer to two different sets of circumstances, arising at different times, may also be seen from the use of differing criteria in s 177(3)(a) and (b), and the differing dates for assessment provided for by s 179(2)(a) on one hand, and by s 179(2)(b) and (c) on the other. The Planning Commission submitted that the assessment of compensation is governed by s 179(1), so that, whether at first sale or upon a development application, the assessment is based on an opinion on what is likely and unlikely to be approved. The Planning Commission submitted that it is this assessment which establishes the extent of loss apparent, not the sale or development application outcome. But the terms of s 179 expressly contemplate that the compensation payable for injurious affection may reflect not only the diminution in the price the land may command upon sale in the market, but also the diminution in value attributable to refusal of development approval or a grant of approval upon unacceptable conditions. In any event, one should not approach the construction of Pt 11 of the Act, and s 179 in particular, on the assumption that the compensation for which the Part provides is confined to compensation for loss suffered by reason of a diminution in the value of land realisable by sale. This notion is better discussed in the context of a discussion of the purpose of s 177. 114 Section 177(2)(a). 115 Section 177(2)(b). The purpose of s 177 Several excerpts from Hansard may usefully be noted here as having a bearing upon an understanding of the purpose of s 177 of the Act. A concern directly on the point at issue here was raised in 1969 in the Legislative Assembly116 in response to the Second Reading Speech117 for the enactment of a Bill118 to amend s 36 of the MRTPS Act. In answer to the question, the Minister for Education said119: "The Bill ... is designed to ensure that the owner at the time of reservation, and he alone, will be compensated". This answer supports the view urged by the Planning Commission. It may be accepted that, before the 1986 amendments, it was clear that only the owner of land at the date of the reservation was entitled to be paid compensation, but it is not apparent that that intention survived the amendment. The more explicit the change in the text of the legislation effected by an amendment, the less compelling is an inference, based on legislative history, that no change in effect was intended by the amendment. When one looks at the materials which explain the introduction of the then equivalent of s 177(2)(b), it is apparent that the principal concern was to ensure that compensation is paid only once. That concern was pursued by the enactment of a measure which, read literally, contemplated that more than one owner of affected land may be eligible for a payment of compensation for injurious affection. In 1986, in the Second Reading Speech120 by the Minister for Planning, in relation to the Bill121 for the enactment of provisions in the same terms as would ultimately become s 177 of the Act as a further amendment to the MRTPS Act, it was said that "[t]he matters provided for in this Bill do not constitute major 116 Western Australia, Legislative Assembly, Parliamentary Debates (Hansard), 12 November 1969 at 2607-2608. 117 Western Australia, Legislative Council, Parliamentary Debates (Hansard), 4 November 1969 at 2098. 118 Metropolitan Region Town Planning Scheme Act Amendment Bill 1969 (WA). 119 Western Australia, Legislative Assembly, Parliamentary Debates (Hansard), 12 November 1969 at 2608. 120 Western Australia, Legislative Assembly, Parliamentary Debates (Hansard), 12 June 1986 at 173. 121 Metropolitan Region Town Planning Scheme Amendment Bill 1986 (WA). changes to the present metropolitan region scheme legislation". The Minister went on to refer to a "comprehensive package of initiatives for speeding up and improving the statutory planning process", and then, having discussed those matters of process, the Minister said: "Next, it is proposed to amend the Act in relation to the payment of compensation for land which has been reserved under the metropolitan region scheme so that it is clear that compensation for injurious affection is paid only once to the person who is the owner at the date of reservation when the land is first sold following the date of reservation; or the person who is the owner at the time when the responsible authority refuses an application for development on the land or grants permission subject to conditions which are unacceptable to the owner. At present there is uncertainty about claims being able to be paid more than once in respect of the same portion of land." The Second Reading Speech is significant in two respects. First, it identifies the mischief at which s 177 was directed. That mischief was uncertainty as to the possibility of more than one claim for compensation becoming payable in respect of the same parcel of land. The proposed measure was clearly intended to ensure that compensation is paid once only in respect of the one reservation; but there was no indication of an intention that only the owner at the time of reservation should be paid compensation. Much less was there an indication that compensation should not be paid at all if it were not payable to the person who was the owner at the date the reservation came into effect, even though a subsequent owner actually suffers a diminution in value because the refusal of a development approval (or approval on unacceptable conditions) means that the land may not be exploited to its highest and best (and most valuable) use. It cannot be said that the language of s 177, in its ordinary meaning, "leads to a manifest contradiction of the apparent purpose of the enactment, or to some inconvenience or absurdity which can hardly have been intended"122. Secondly, the Second Reading Speech contains no hint that the then equivalent to s 177(2)(a) and (b) was intended to refer to the very same person, ie the owner of the land at the date the reservation came into effect. It offers no reason to suppose that s 177(2) does not intentionally differentiate between the person who was the owner at the date of reservation and the person who was the owner at the date of an application for development approval in respect of reserved land. Indeed, the assumption on which s 177(2) proceeds is that 122 Cf Langan, Maxwell on the Interpretation of Statutes, 12th ed (1969) at 228. compensation may be claimable by more than one owner. That is why it provides that it is to be payable only to one of them. The Planning Commission submitted that a person who comes to purchase land reserved under a planning scheme knows, or should know123, of the restriction giving rise to the injurious affection. It submitted that the decision of the Court of Appeal would allow a person who has paid an "affected" price, and has therefore suffered no loss on the purchase, to be paid compensation. The Planning Commission submitted that it is an implicit object of the regime not to "compensate" persons who have suffered no loss. The argument advanced on behalf of the Planning Commission proceeds on the assumption that the adverse effect of a planning scheme in relation to a particular parcel of land will be manifest in the reduction of the market value of the land reflected in the price achieved upon the first sale of the land after the planning scheme comes into effect. But this case offers a concrete example of the fragility of that assumption. In this regard, at the time of the reservation, two of the claimants, Southregal and Mr Wee, were not the owners of the land; they entered into the first contract of sale before the reservation had come into effect. More generally, Pt 11 of the Act does not employ the concept of "loss" as a measure of compensation. As the primary judge observed, Pt 11 of the Act is concerned to provide for the payment of compensation where land is injuriously affected by a planning scheme, as explained by s 174124. It is wrong to approach the proper interpretation of Pt 11 of the Act as if it were solely concerned to provide compensation measurable by reference to the first sale by an owner of affected land. While the sale price may be less than it otherwise would have been because the effect of the reservation is factored in, in some general way, to the price of the first sale after the reservation comes into effect, s 177(2)(b) and s 179(2)(b) and (c) expressly contemplate a diminution in value arising out of the reservation and the subsequent refusal of an application for development approval or grant of an approval on unacceptable terms. It must be borne in mind that the reservation of land for public purposes does not operate to resume land or effect an absolute prohibition on development. Whether a reservation of land for public purposes actually diminishes the value of land in a sufficiently material way, so as to entitle the owner of the land to payment of compensation, may not be known until an application for a development approval is refused. And that diminution in value may bear little relationship to the price paid by the owner. 123 See cl 47(1) of the PRS, under which a "certificate" is issued on settlement requisitions "stating the manner in which [the land] is affected by the Scheme". 124 Leith v Western Australian Planning Commission [2014] WASC 499 at [59]. The Planning Commission's argument sits uneasily with the reasoning of the Full Court of the Supreme Court of Western Australia in Bond Corporation Pty Ltd v Western Australian Planning Commission125. In that case, the Full Court held126 that "sale" in the then statutory equivalent of s 177(1) of the Act meant "conveyance" rather than "agreement to sell". It is not necessary in these appeals to consider whether Bond Corporation was correctly decided because no party sought to challenge the decision or the reasoning of the Court in that case. It is sufficient for present purposes to note the difficulty in accommodating the terms of s 177(3)(a)(iii), which expressly contemplate the taking of steps which can only be taken before the making of an agreement to sell, with the view that sale means a conveyance which may occur after a reservation has come into effect, in circumstances where the vendor had no opportunity to comply with s 177(3)(a)(iii). More relevantly for present purposes, in Bond Corporation, Ipp J, with whom Wallwork and Owen JJ agreed, said127: "Owners of land suffer loss merely by the reservation of land for public purposes. That loss is constituted simply by the reduction in the market value of the land caused by the reservation and the inability of the owner to use the land for purposes conflicting with the reservation (even where the owner does not intend to develop the land in any way). The loss sustained on reservation occurs without the owner taking any action in connection with the land, and while the owner still holds the land in the form it was in immediately prior to the reservation. When compared to the kind of loss sustained on conveyance or development refusal where owners are prevented from developing land in accordance with their genuine intent, the loss suffered on reservation is less concrete or tangible. The point to be noticed is that Parliament, by s 36(3), provided that compensation was not to be payable upon that kind of loss being sustained." The reference by Ipp J to "s 36(3)" is a reference to s 36(3) of the MRTPS Act, which was a precursor to s 177(1) of the Act. The point to be made here is that Ipp J rejected the proposition that the loss "constituted simply by the reduction in the market value of the land caused by the reservation" was the 125 (2000) 110 LGERA 179 ("Bond Corporation"). 126 (2000) 110 LGERA 179 at 190-191 [50]-[51]. 127 Bond Corporation (2000) 110 LGERA 179 at 187-188 [34]. object of the compensation for which the legislation provided. His Honour went on to say128: "It seems to me that loss caused by the entering into of an agreement of sale at a price lower than the price the land would have fetched but for the reservation, is a loss that falls into the same category as loss sustained on reservation. Until the owner actually receives payment of the purchase price for the land (ordinarily upon conveyance), the loss suffered upon the agreement of sale being entered into differs little in character from the loss suffered upon the land being reserved. In a limited sense each of those losses can be described as 'paper' losses inasmuch as they do not result in the owner of land actually receiving less for the land on sale, or being unable to use the land as genuinely intended." Having made the point that the legislation is not concerned to provide compensation for notional or paper losses, Ipp J went on to say129: "In my opinion, the philosophy underlying the deferment of payment of compensation as provided for by [the MRTPS Act] is that compensation for injurious affection should only be payable when the owner of the land involved suffers a significantly more tangible loss than that which occurred when the land was reserved. … I prefer the argument that Parliament intended [the MRTPS Act] to provide that payment for compensation should be only be made [sic] when the owner of land actually receives less money for the land than he or she would have received had there been no reservation, or when the genuine intention of the owner to develop the land is frustrated by a development refusal brought about by the reservation." Two points may be made here. First, as Ipp J explained in Bond Corporation, the Act contemplates the possibility of a diminution in the value of land which does not crystallise sufficiently to entitle an owner to a payment of compensation until the refusal of an application for development approval or the approval of an application on unacceptable conditions. The Act provides that this diminution in value is compensable by a payment of compensation, whatever price the owner at that time may have paid for the land. The extent of compensation payable for injurious affection in such a case will, by the application of s 179(1), reflect the diminution in the value of the land attributable to the owner's inability to use the reserved land in accordance with its highest and best use at the date specified in s 179(2)(b) or (c). 128 Bond Corporation (2000) 110 LGERA 179 at 188 [35]. 129 Bond Corporation (2000) 110 LGERA 179 at 188 [37]. Secondly, while it is no doubt possible to draw a formal distinction between the creation of a right and the deferment of its realisation by payment, the difference may have no significance as a matter of substance. While it may be possible to say that s 173(1) of the Act creates a right to compensation, the realisation of which is deferred by s 177(1), it is no less true to say as a matter of substance that injurious affection by reservation is not compensable until the diminution in value is determined by sale or the refusal of a development application or approval on unacceptable terms, whichever first occurs. Accordingly, to accept that the right to compensation created by s 173(1) is not realisable until the occurrence of the first of the events contemplated by s 177(2) is to accept no more than that s 173(1) is subject to s 177, which is what s 173(1) expressly states. This is not to assert that s 173(1) creates a right of compensation which "runs with the land". Rather, it is to acknowledge that the operation of s 177, and in particular s 177(2)(b) and s 177(3)(b), explains the nature, effect and practical operation of s 173(1). Conclusion Each appeal should be dismissed with costs.

HIGH COURT OF AUSTRALIA AUSTRALIAN COMPETITION AND CONSUMER COMMISSION APPELLANT AND FLIGHT CENTRE TRAVEL GROUP LIMITED RESPONDENT Australian Competition and Consumer Commission v Flight Centre Travel Group Limited [2016] HCA 49 14 December 2016 ORDER Appeal allowed. Set aside the order of the Full Court of the Federal Court of Australia made on 31 July 2015, and in its place order that: the appeal be allowed in part; the respondent be granted leave to file its amended notice of cross-appeal dated 3 August 2016; the cross-appeal be allowed in part; the declaration made by Logan J on 28 March 2014 be varied as follows: in paragraph 1, omit the words "distribution and booking services international passenger air travel" and replace them with the words "international airline tickets"; for in each of paragraphs 1(a), (b), (c), (d), (e) and (f), omit the words "distribution and booking"; (iii) in each of paragraphs 1(a), (b) and (f), omit the words "the retail or distribution margin received by Flight Centre for its booking and distribution services would be maintained" and replace them with the words "the price Flight Centre charged its supply of international airline tickets would be maintained, and that the price Singapore Airlines charged for its supply fixed, international airline controlled or maintained"; tickets would be for in each of paragraphs 1(c) and (d), omit the words "the retail or distribution margin received by Flight Centre for its booking and distribution services would be maintained" and replace them with the words "the price Flight Centre charged its supply of international airline tickets would be maintained, and that the price Emirates charged for its supply of international airline tickets would be fixed, controlled or maintained"; and for and distribution services would in paragraph 1(e), omit the words "the retail or distribution margin received by Flight Centre for its booking maintained" and replace them with the words "the price Flight Centre charged its supply of international airline tickets would be maintained, and that the price Malaysia Airlines charged for its supply fixed, international airline controlled or maintained"; and tickets would be for each party bear its own costs of the proceedings in the Full Court to date. Remit the matter to the Full Court of the Federal Court of Australia for the determination of the appeal and cross-appeal insofar as they relate to penalty. On appeal from the Federal Court of Australia Representation J T Gleeson SC, Solicitor-General of the Commonwealth with M R Hodge and R C A Higgins (instructed by Australian Government Solicitor) B W Walker SC with M I Borsky for the respondent (instructed by King & Wood Mallesons) M H O'Bryan QC with N P De Young for the International Air Transport Association, as amicus curiae (instructed by Minter Ellison Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Australian Competition and Consumer Commission v Flight Centre Travel Group Limited trade practices – Substantially Trade practices – Restrictive lessening competition – Price fixing – Where travel agent sold international airline tickets on behalf of airlines – Where travel agent attempted to induce airlines to agree not to discount price at which international airline tickets offered directly to customers – Whether travel agent acting as agent for airlines – Whether travel agent and airlines "in competition" notwithstanding travel agent supplied as agent for airlines – Trade Practices Act 1974 (Cth), ss 45(2)(a)(ii), 45(3), 45A. Trade practices – Restrictive trade practices – Market definition – Relevance of "functional approach" to market definition. Words and phrases – "agency agreement", "agent", "competition", "functional approach to market definition", "international air carriage", "market", "price fixing", "substantially lessening competition". Trade Practices Act 1974 (Cth), ss 4E, 45, 45A. Introduction There is a considerable demand in Australia for international air travel. International airlines operating in Australia provide air travel services and sell those services principally through travel agents under contractual arrangements. They also sell directly to consumers. This appeal concerns a travel agent which, between August 2005 and May 2009, tried to persuade three airlines whose tickets it sold, under contractual arrangements with them, not to undercut it in their direct sales. The Australian Competition and Consumer Commission ("ACCC") alleged that the agent was a competitor of the airlines in relevant markets and had contravened s 45 of the Trade Practices Act 1974 (Cth) ("the Act"), as it stood during the relevant time, by proposing an arrangement or understanding with a view to maintaining or controlling the price of air tickets supplied to consumers. The answer to the question whether the agent contravened the Act turns critically upon whether or not the agent was, in any relevant sense, in competition with the three airlines, which were its principals at the time it made the proposals. I would answer that question in the negative. In that respect I am in disagreement with the other members of the Court and I would dismiss the appeal. Procedural background Between August 2005 and May 2009, the period relevant to this appeal, Flight Centre Travel Group Ltd ("Flight Centre"), then called Flight Centre Ltd, conducted a travel agency business in Australia and overseas through a distribution network comprising shopfronts, call centres and the internet. It sold international passenger air travel services to consumers pursuant to a standard form Passenger Sales Agency Agreement ("PSAA") between itself and various carriers. The form of agreement had been prepared by the International Air Transport Association ("IATA"). Flight Centre also offered consumers travel advice about possible destinations and available flights on different airlines to those destinations. It received payment from customers for air travel booked through it and remitted the amounts less commission to the airlines. The airlines whose international passenger air travel services Flight Centre sold also sold directly to prospective passengers. In 2012, the ACCC commenced proceedings against Flight Centre, alleging that, between 19 August 2005 and 16 May 2009, it had contravened s 45(2)(a)(ii) of the Act. Flight Centre was said to have proposed to Emirates, Malaysia Airlines and Singapore Airlines an arrangement or understanding containing a provision which had the purpose and/or was likely to have the effect of fixing or controlling or maintaining prices for the supply of the services which it and they were selling. On the premise that Flight Centre, although their agent, was also in competition with those airlines, it was said that by operation of a deeming provision, s 45A(1) of the Act1, the proposed arrangement or understanding had the purpose or would have or be likely to have the effect of substantially lessening competition and that by proposing it Flight Centre had contravened s 45. As appears from the provisions of ss 45 and 45A, the characterisation of Flight Centre as a competitor of the airlines, whose services it provided to its customers, was necessary in order to establish the contraventions alleged. The primary judge2 found that Flight Centre and the airlines were in competition in a market for booking and distribution services and that Flight Centre's conduct reflected in a series of emails to the airlines constituted an attempt to induce each of them to make an arrangement that would have contravened s 45(2)(a)(ii) of the Act by virtue of s 45A of the Act3. His Honour rejected the contention that Flight Centre and the airlines were in competition in the market for flights. Only the airlines supplied flights as only they operated aircraft4. The Full Court5 held that, to the extent that rivalry existed between Flight Centre and the three airlines, it was in respect of the market for the supply of international passenger air travel services in which it wanted to sell as many flights as it could on behalf of the airlines. The more flights it sold, the more it would receive in the form of commission and other incentive-based payments under "preferred airline agreements" entered into with the three airlines. The more direct sales the airlines effected, the fewer agency sales Flight Centre could make and the less commission it could earn6. But, as their Honours correctly held, that rivalrous or competitive behaviour was not in a market in which both Flight Centre and the airlines supplied goods or services in competition with each 1 Repealed by item 21 of Sched 1 to the Trade Practices Amendment (Cartel Conduct and Other Measures) Act 2009 (Cth) with effect from 24 July 2009. Section 45A was superseded by Div 1 of Pt IV of the Act; subs (1) was in effect replaced by the purpose/effect condition in s 44ZZRD(2). 2 Australian Competition and Consumer Commission v Flight Centre Ltd (No 2) (2013) 307 ALR 209. (2013) 307 ALR 209 at 261 [197]. (2013) 307 ALR 209 at 244 [135]. 5 Flight Centre Ltd v Australian Competition and Consumer Commission (2015) 234 FCR 367. (2015) 234 FCR 367 at 402 [173]-[174]. other. Only the airlines supplied international passenger air travel services. Flight Centre operated in the market for such services, but only as agent for the airlines7. There was no separate market for distribution and booking services8. In this respect it was held that the primary judge had erred because he transferred or transplanted the rivalry or competition which he had found existed in a broad sense into that non-existent market. The ACCC's primary and secondary cases on appeal The primary case advanced by the ACCC, as explained in the joint judgment of Kiefel and Gageler JJ9, was that Flight Centre competed with each of the airlines in markets for the provision of distribution services to international airlines and for the provision of booking services to customers. Whether or not Flight Centre was in any relevant sense in competition with the airlines, I agree with their Honours that, as the Full Court held, it would be quite artificial to describe an airline selling directly to its customers as providing distribution services to itself in competition with distribution services provided to it by travel agents. As their Honours observe, booking flights, issuing tickets and collecting fares were inseparable elements of the sale of air tickets10. The ACCC's secondary case, as described in the joint judgment11, was that Flight Centre sold international air tickets in competition with the airlines in a market for the supply of contractual rights to international air carriage to customers. These reasons are concerned with that secondary case insofar as it depends on the proposition that Flight Centre was acting in competition with the airlines which had appointed it as their agent. The detailed facts are set out in the other judgments but it is necessary to make reference to the contractual arrangements between Flight Centre and the airlines which lie at the heart of their agency relationship. The Passenger Sales Agency Agreement The appointments of Flight Centre as agent with authority to sell air tickets for Emirates, Malaysia Airlines and Singapore Airlines were effected pursuant to the PSAA, which it had entered into on 28 June 1995. The PSAA (2015) 234 FCR 367 at 402-403 [175]. (2015) 234 FCR 367 at 403 [176]. 9 Reasons for judgment of Kiefel and Gageler JJ at [48], [64]. 10 Reasons for judgment of Kiefel and Gageler JJ at [73]-[74]. 11 Reasons for judgment of Kiefel and Gageler JJ at [50], [61]. was expressed to be made between Flight Centre, described as "the Agent", and "each IATA Member (hereinafter called 'Carrier') which appoints the Agent, represented by the Director General of IATA acting for and on behalf of such IATA Member". The agreement came into effect as between the Agent and any particular carrier upon appointment of the Agent by the Carrier in accordance with Sales Agency Rules in effect in the country of the Agent's location12. The appointment of an Agent could be withdrawn by the Carrier by notice in writing and in accordance with the Sales Agency Rules, with effect from the last day of the month following the month in which notice was given13. The Agent was authorised by the agreement to "sell air passenger transportation on the services of the Carrier" which had appointed it and on the services of other air carriers as authorised by the Carrier14. The sale of air passenger transportation encompassed activities necessary to provide a passenger with a valid contract of carriage including the issue of a valid air ticket15 and the collection of monies for it. The Agent was also authorised to sell ancillary and other services as authorised by the Carrier16. All services sold pursuant to the PSAA were to be sold on behalf of the Carrier and in compliance with the Carrier's tariffs, conditions of carriage and written instructions provided to the Agent. The Agent was not permitted to vary or modify the terms and conditions set out in any ticket used for services provided by the Carrier17. It was not in dispute, however, that the Agent could, consistently with the PSAA, sell tickets to consumers at a price which it determined. The Agent had no proprietary rights to tickets and the Carrier could at any time require the immediate return of any tickets deposited but not yet issued to customers18. The Agent could not issue tickets through a third party automated ticketing system without the authority of the Carrier19. The Agent was to be 12 PSAA, cl 1. 13 PSAA, cl 13. 14 PSAA, cl 3.1. 15 Referred to in the PSAA as a "Traffic Document". 16 PSAA, cl 3.1. 17 PSAA, cl 3.2. 18 PSAA, cl 6.1. 19 PSAA, cl 6.3. remunerated by the Carrier for each sale of air transportation and ancillary services20. Under the PSAA, the Agent received "at-source" commission for each ticket sold. The commission comprised a percentage of the published fare, which was a fare fixed by the Carrier for the relevant seat on the particular flight. Agents were informed of published fares through an electronic reservation system called the Global Distribution System21. The Agent was required to collect the amount payable for the transportation or other service sold by it on behalf of the Carrier and was responsible for payment of the amount to the Carrier. All monies collected by the Agent, including applicable commissions which the Agent was entitled to claim, were the property of the Carrier and held by the Agent in trust for the Carrier until satisfactorily accounted for and settlement made. The Agent would remit to the Carrier the amount of the published fare less the "at-source" commission22. As found by the primary judge, the price which each airline paid for the services provided by Flight Centre was the retail or distribution margin which was retained with the airline's permission23. If Flight Centre sold a ticket for more than the published fare, it would recover a greater margin comprising the "at-source" commission and the excess over the published fare24. At the relevant time, the three airlines sold 80 to 85 per cent of their tickets through travel agents. The remainder were sold directly by the airlines25. Flight Centre also entered into preferred airline agreements with each of Emirates, Malaysia Airlines and Singapore Airlines during the relevant period. Under those agreements it could earn additional commissions and payments broadly dependent upon sales volume26. 20 PSAA, cl 9. 21 (2015) 234 FCR 367 at 370-371 [15]. 22 PSAA, cl 7.2. 23 (2013) 307 ALR 209 at 248 [151]. 24 (2015) 234 FCR 367 at 371 [17]. 25 (2013) 307 ALR 209 at 220 [37]. 26 (2015) 234 FCR 367 at 371 [18]. Agents and competition The proposition that an agent and a principal, both selling the services of the principal, compete with each other in a market for the sale of those services does not command ready assent. The word "agent" connotes in law a person who has the authority or capacity to create legal relations between a person who occupies the position of principal and third parties27. The legal concept is encapsulated in the maxim quoted in Petersen v Moloney28, "[q]ui facit per alium facit per se" — he who does an act through another does it himself29. That being said, it must be accepted that, in the parlance of trade and commerce, the term "agent" is not confined to the concept of an agent at law30. This case, however, is not concerned with competitive conduct in the wider sphere of "commercial agents". For any given principal and agent at law, the incidents of their legal relationship arise at common law and equity subject to the particular terms of any contract between them. There may be a variety of related activities outside the framework of the agency agreement, and permitted by it, which an agent carries on to enhance its marketing position in relation to the principal's services or which are otherwise conducted for profit on its own account. In the conduct of some such extraneous activities an agent might compete with its principal without contravening their contractual relations or any incidents of those relations. The ACCC submitted, and it is correct, that the PSAA did not define the full range of services offered by Flight Centre. Those included travel intermediary services which the airlines themselves offered when engaged in direct selling. But that is beside the point. In this case, the alleged contravening conduct related to an activity by Flight Centre which lay at the heart of an agency relationship, namely the sale by Flight Centre or its airline principals of contractual rights to travel on those airlines. That is the only activity to which the alleged contravening proposals by Flight Centre related. The Full Court 27 International Harvester Co of Australia Pty Ltd v Carrigan's Hazeldene Pastoral Co (1958) 100 CLR 644 at 652; [1958] HCA 16. 28 (1951) 84 CLR 91 at 94; [1951] HCA 57. 29 See also Motel Marine Pty Ltd v IAC (Finance) Pty Ltd (1964) 110 CLR 9 at 13; [1964] HCA 7. 30 (1958) 100 CLR 644 at 652 quoting Kennedy v De Trafford [1897] AC 180 at 188 per Lord Herschell. found correctly that this case had nothing to do with the broader range of services The ACCC referred to the approach taken in the European Union to vertical pricing arrangements between commercial agents and those on whose behalf they acted. The relevant law is to be found in Art 101(1) of the Treaty on the Functioning of the European Union (formerly Art 81(1) of the Treaty Establishing the European Community). That Article prohibits, inter alia32: "all agreements between undertakings ... which have as their object or effect the prevention, restriction or distortion of competition within the internal market, and in particular those which: directly or indirectly fix purchase or selling prices or any other trading conditions". The term "undertaking" embraces, as the European Court of Justice has held, "every entity engaged in an economic activity, regardless of the legal status of the entity and the way in which it is financed"33. A genuine agent is considered to be a part of the same economic unit as its principal, with the result that the two are regarded as a single "undertaking" and conduct between them does not engage the prohibition34. A finding that one entity is an integral part of another entity's business or undertaking might be sufficient, but plainly is not necessary, to support a conclusion that they cannot be in competition with each other. A principal and its agent in the market for the supply of the principal's goods or services sold by both agent and principal may resemble a single economic unit for some purposes but not for others. An agent at law for a principal pursuant to an agency agreement may well be viewed as acting as one economic unit with its principal when it creates contractual rights as between third parties and the principal. It is 31 (2015) 234 FCR 367 at 400 [161]. 32 Treaty on the Functioning of the European Union, OJ C 202 of 7 June 2016, Art 101(1). Formerly Treaty Establishing the European Community, OJ C 321E of 29 December 2006, Art 81(1). 33 Höfner and Elser v Macrotron GmbH [1991] ECR I-1979 at I-2016 [21]. 34 Coöperatieve vereniging "Suiker Unie" UA v Commission of the European Communities [1975] ECR 1663 at 1998 [480], 2007 [539]; DaimlerChrysler AG v Commission of the European Communities [2005] ECR II-3319 at II-3358 [86]; Confederación Española de Empresarios de Estaciones de Servicio v Compañía Española de Petróleos SA [2006] ECR I-11987 at I-12033 [40]-[42]. inconsistent with that characterisation of its action according to the law of agency to treat such action as capable of being competitive with its principal in the sense relevant to the operation of the Act. It should be added that if an agent bears some financial risk associated with its activities and does not have an obligation to act generally in the interests of its principal, this does not establish that it is in competition with its principal when it comes to the supply to third parties of contractual rights to the principal's goods or services. There are examples of manufacturers or wholesalers or the originators of services entering into agreements with dealers or "agents" which include provision for "top-down" vertical price controls, ie, controls imposed on the dealers or agents. United States cases on such arrangements have drawn uneasy distinctions between "agents" selling products on consignment at prices specified by their "principals"35, "dealers" selling products at a specified price under a "coercive" pricing arrangement36 and "dealers" reselling products under a supply agreement37. So far as the Sherman Act prohibition on agreements in restraint of trade is concerned38: "Consignment arrangements, and in fact all agency relations, are agreements. If they happen also to be agreements which restrain trade, they are within the Sherman Act's scope. On the basis of elementary principle, agreements are in restraint of trade if they restrain competition in price in the market between persons who stand in either an actual or a potential competitive relationship." Relevantly for present purposes, that analysis focuses upon persons who are or are potentially in competition with each other. In that respect the text of s 45, unlike §1 of the Sherman Act, is explicit. The present case, however, is not concerned with a price fixing provision in the PSAA itself, nor with any "top- down" conduct of the airlines pursuant to the PSAA. Nor is it concerned with "top-down" price fixing by a principal resulting from upward pressure by travel agents in a network of agents which are in competition with each other. 35 United States v General Electric Co 272 US 476 (1926). 36 Simpson v Union Oil Co of California 377 US 13 (1964) in which a coercive pricing arrangement embodied in a dealership agreement for sale on consignment and applied to a very large network of dealers was held to contravene §1 of the Sherman Act, 15 USC §§1-7. 37 Dr Miles Medical Co v John D Park & Sons Co 220 US 373 (1911). 38 Rahl, "Control of an Agent's Prices: The Simpson Case — A Study in Antitrust Analysis", (1966) 61 Northwestern University Law Review 1 at 14. The ACCC argued that the agency relationship between Flight Centre and the airlines did not defeat the proposition that Flight Centre was supplying a service to consumers in competition with the airlines. That latter argument depended, it was said, upon an examination of the conditions under which and the extent to which Flight Centre could be said to be an agent of the airlines. That examination, however, yields the conclusion that what Flight Centre did in selling an air ticket was properly regarded as the action of the airline itself. Further, the market in which Flight Centre and the airlines were selling was the market in which international airlines competed for the sale of their services. There was no "market" for the supply of the tickets of a particular carrier. Flight Centre's expressed concerns and proposals about the pricing practices of its principals did not involve the making of a proposal by one competitor to another in any relevant market. Pursuant to the legally binding authority conferred upon it by each airline, Flight Centre created, with each sale, a contractual relationship between the airline and the customer. The subject matter of that contractual relationship was the right to fly with the airline. It may be accepted that in creating that contractual relationship Flight Centre was strictly "supplying" a service within the definition of the term "supply" as "provide, grant or confer"39. The services it was supplying fell within that aspect of the definition of "services" in the Act which referred to "any rights ... that are, or are to be, provided, granted or conferred in trade or commerce"40. It may also be accepted that the greater the number of consumers who chose to deal with an airline principal directly rather than with Flight Centre, the less the return to Flight Centre. There is no doubt that a differential between the prices offered by the airline and the prices offered by Flight Centre to consumers had the potential to affect Flight Centre's economic interests by creating an economic incentive for consumers to deal with the airline rather than it or vice versa. Its concerns about the effect of the airlines' pricing practices on its economic interests could be seen to be analogous to those of one competitor about the pricing practices of another. Nevertheless, in relation to the supply of contractual rights Flight Centre's conduct is properly to be regarded as that of the airline. Its concerns about pricing are not amenable to characterisation as competitive for the purposes of the Act. That characterisation assumes a concept of competition under the Act which is in tension with that of an agency relationship at law. It opens the door to an operation of the Act which would seem to have little to do with the protection of competition. 39 Act, s 4(1), definition of "supply". 40 Act, s 4(1), definition of "services". In my opinion, Flight Centre was not in competition, in any relevant market, with the airlines for which it sold tickets. Its proposals with respect to the pricing practices of its principals were not proposals offered by it as their competitor but as their agent. I would dismiss the appeal with costs. Introduction The substantial question in this appeal is whether Flight Centre Travel Group Limited (previously Flight Centre Limited) was in competition with Singapore Airlines, Malaysia Airlines and Emirates when Flight Centre attempted to induce each of those airlines to agree not to discount the price at which that airline offered international airline tickets directly to customers. The short answer is that Flight Centre was in competition with each airline. The competition was in a market for the supply, to customers, of contractual rights to international air carriage. The competition existed in that market notwithstanding that Flight Centre supplied in that market as agent for each airline. Flight Centre accordingly contravened s 45(2)(a)(ii) of the Trade Practices Act 1974 (Cth) as then in force. Facts Flight Centre carried on the business of a travel agent, in Australia and elsewhere, from shop fronts and call centres, and over the internet. As a travel agent, Flight Centre engaged in conduct which can be described, in practical and commercial terms, as selling international airline tickets to customers. The international airline tickets were contractual rights entitling customers to be provided with international air carriage by airlines which were members of the International Air Transport Association. Those airlines included Singapore Airlines, Malaysia Airlines and Emirates. Flight Centre's authority to sell international airline tickets to customers was conferred by a standard form Passenger Sales Agency Agreement, which Flight Centre had entered into with the International Air Transport Association on behalf of its member airlines. In the Agency Agreement, Flight Centre was referred to as "the Agent", each airline was referred to as "the Carrier", and an international airline ticket was referred to as a "Traffic Document". The Agency Agreement provided: "[T]he Agent is authorised to sell air passenger transportation on the services of the Carrier and on the services of other air carriers as authorized by the Carrier. The sale of air passenger transportation means all activities necessary to provide a passenger with a valid contract of carriage including but not limited to the issuance of a valid Traffic Document and the collection of monies therefor. The Agent is also authorized to sell such ancillary and other services as the Carrier may authorize". The Agency Agreement continued: "[A]ll services sold pursuant to this Agreement shall be sold on behalf of the Carrier and in compliance with Carrier's tariffs, conditions of carriage and the written instructions of the Carrier as provided to the Agent. The Agent shall not in any way vary or modify the terms and conditions set forth in any Traffic Document used for services provided by the Carrier, and the Agent shall complete these documents in the manner prescribed by the Carrier". The Agency Agreement further provided that, on the issue of a Traffic Document by the Agent, the Agent was obliged to pay the Carrier a nett amount. The nett amount was in practice calculated as the fare published by the Carrier to travel agents, through an electronic reservation system known as a Global Distribution System, less a percentage of that published fare known as "at-source commission". A Carrier was not constrained by the Agency Agreement from selling international airline tickets through another travel agent or directly to customers. The Agent was free under the Agency Agreement to sell or not to sell an international airline ticket of any Carrier. The Agent was also free under the Agency Agreement to sell any ticket to any customer at any price. The higher the price at which the Agent sold a ticket to a customer relative to the nett amount which the Agent was obliged to pay to the Carrier, the greater the Agent's retail margin on the sale. Part of Flight Centre's marketing strategy was a "price beat guarantee". Flight Centre advertised that it would better the price for an airline ticket quoted by any other Australian travel agent or website, including a website operated by an airline, by $1 and would give the customer a voucher for $20. The price beat guarantee made Flight Centre commercially vulnerable to an airline choosing to offer tickets directly to customers at a discount to the fare which the airline published to travel agents. That is what Singapore Airlines, Malaysia Airlines and Emirates each chose to do. In series of emails sent to Singapore Airlines, Malaysia Airlines and Emirates between 2005 and 2009, Flight Centre tried to get each airline to agree to stop offering international airline tickets directly to customers at prices lower than the fares published to travel agents. Flight Centre went so far as to threaten to stop selling the tickets of each airline if that airline did not agree. Provisions Section 45(2)(a)(ii) of the Act prohibited a corporation from making a contract or arrangement, or arriving at an understanding, if a provision of the proposed contract, arrangement or understanding had the purpose, or would have or be likely to have the effect, of "substantially lessening competition". Section 45A(1) deemed a provision of a contract, arrangement or understanding to have the purpose, effect or likely effect of substantially lessening competition if, relevantly, two conditions were satisfied. The first was that the provision had the purpose, effect or likely effect of fixing, controlling or maintaining the "price" for "services supplied" by one party to the contract, arrangement or understanding. The second was that the services in relation to which the price was fixed, controlled or maintained were supplied "in competition with" the other party to the contract, arrangement or understanding. Section 45(3) relevantly provided that "competition" for the purposes of ss 45 and 45A meant "competition in any market in which a corporation that is a party to the contract, arrangement or understanding ... supplies ... services". For the purposes of the Act, s 4(1) defined "price" to include "a charge of any description" and defined "services" to include "any rights … benefits, privileges or facilities that are, or are to be, provided, granted or conferred in trade or commerce". The same provision defined "supply", in relation to services, to include "provide, grant or confer" and defined "supplied" to have a corresponding meaning. Section 4C(b) extended the definition of supply, in relation to services, by providing that a reference to supplying services included a reference to agreeing to supply services. For the purposes of the Act, s 4E defined "market" to mean "a market in Australia and, when used in relation to any … services, [to include] a market for those … services and other … services that are substitutable for, or otherwise competitive with, the first-mentioned … services". Finally, for the purposes of the Act, s 84(2) provided that any conduct engaged in on behalf of a body corporate "by a director, servant or agent of the body corporate within the scope of the person's actual or apparent authority" was to be deemed "to have been engaged in also by the body corporate". Sections 76(1)(a)(i) and 76(1)(d) of the Act empowered the Federal Court, if satisfied that a person "attempted to induce" another to contravene a provision of Pt IV "whether by threats or promises or otherwise", to order the person to pay such pecuniary penalty as that Court determined to be appropriate. Section 77 allowed a proceeding for the recovery of pecuniary penalty to be instituted by the Australian Competition and Consumer Commission ("the ACCC") within six years of a contravention. Pecuniary penalty proceeding In a proceeding for the recovery of pecuniary penalty commenced in the Federal Court in 2012, the ACCC alleged that, by sending the emails between 2005 and 2009, Flight Centre attempted to induce Singapore Airlines, Malaysia Airlines and Emirates each to make a contract or arrangement, or arrive at an understanding, with Flight Centre, in contravention of s 45(2)(a)(ii) of the Act read in light of s 45A of the Act. Satisfaction of the first condition of s 45A(1) presented little difficulty in the proceeding. The primary judge found that, by sending the emails, Flight Centre attempted to induce each airline to make a contract or arrangement, or arrive at an understanding, with Flight Centre. The proposed contract, arrangement or understanding contained a provision that the airline would stop offering international airline tickets directly to customers at prices lower than the fares the airline published to travel agents. The provision had the purpose and direct effect of fixing, controlling or maintaining the price at which that airline sold international airline tickets directly to customers. The provision had the further purpose and indirect effect of fixing, controlling or maintaining Flight Centre's commission (and therefore its retail margin) on its sales of that airline's tickets to customers41. Flight Centre did not contest those findings on appeal. The critical issue in the proceeding concerned satisfaction of the second condition of s 45A(1). The issue was whether a price fixed, controlled or maintained by the proposed provision was in respect of services supplied by Flight Centre and by each airline in competition with each other. Resolution of that issue required: starting with the price that was fixed, controlled or maintained; identifying the services to which that price related; and identifying and defining the market in which those services and the competing services were supplied. The ACCC's primary case concerning satisfaction of the second condition of s 45A(1) started with the fixing, controlling or maintaining of Flight Centre's commission (and therefore its retail margin) on its sales of an airline's tickets. The primary case was that Flight Centre and each airline supplied services in 41 Australian Competition and Consumer Commission v Flight Centre Ltd (No 2) (2013) 307 ALR 209 at 230 [101], 236 [114], 247 [146], 248-249 [151]-[152], 250 competition with each other in two complementary markets. One was an "upstream market", identified as a market for "distribution services to international airlines". The other was a "downstream market", identified as a market for "booking services to customers". The services supplied in the market for distribution services to international airlines were services pertaining to the process of selling an airline ticket. They included booking the flight with the airline, issuing the ticket and collecting the fare. Travel agents supplied those services to airlines. Airlines supplied equivalent services to themselves when airlines sold tickets directly to customers. The services supplied in the market for booking services to customers were services pertaining to the process of buying an airline ticket. They included booking the flight for the customer and having the ticket issued to the customer. Travel agents supplied those services to customers, and airlines supplied at least some of those services to customers when selling tickets directly to customers. The sale to, and purchase by, a customer of an international airline ticket, according to the ACCC's primary case, involved the supply of a distribution service to the airline and the supply of a booking service to the customer. That was so when the sale was made by the airline as much as when the sale was made by Flight Centre. Flight Centre's commission on the sale was the single charge that it made, and therefore the single price that it received, for supplying each of those two distinct services. The ACCC's secondary case concerning satisfaction of the second condition of s 45A(1) was considerably less elaborate but also considerably more obscure. It started with the fixing, controlling or maintaining of the price at which an airline sold tickets directly to customers. The secondary case was that the services in respect of which that price was fixed, controlled or maintained were services which the airline supplied in competition with Flight Centre in a market for the supply to customers of "international passenger air travel services". Unfortunately, the ACCC did not identify with precision what it meant by international passenger air travel services and did not identify with precision the market in which those services were supplied. Plainly, the supply to a customer of international passenger air travel proceeded in two stages. The first stage was the sale to the customer of a ticket conferring a contractual right to carriage. The second stage was performance of that contract by actual carriage. Equally plainly, travel agents and airlines each engaged in selling tickets but only airlines engaged in actual carriage. The primary judge rejected the ACCC's secondary case for the simple reason that Flight Centre did not engage in actual carriage42. The primary judge proceeded nevertheless to accept the essential elements of the ACCC's primary case, save that he saw what the ACCC had proffered as complementary markets for distribution services to international airlines and for booking services to customers as parts of a single market for "distribution and booking services". In that single market, according to the primary judge, travel agents participated "Janus-like" as "travel intermediar[ies]". The international airlines chose to compete with travel agents by supplying services of the same description "in-house", thereby "cutting out the middle man"43. The primary judge found the second condition of s 45A(1) to have been satisfied on that basis, and accordingly found Flight Centre to have contravened s 45(2)(a)(ii). His Honour made declarations of contravention and ordered that Flight Centre pay pecuniary penalty. Appeal to the Full Court Flight Centre appealed to the Full Court against the declarations of contravention and on penalty. The ACCC cross-appealed only on penalty. In the result the issues of penalty were not reached. Overturning the critical findings of the primary judge concerning satisfaction of the second condition of s 45A(1), the Full Court allowed Flight Centre's appeal against the declarations of contravention because it rejected the ACCC's primary case as artificial. The Full Court explained that artificiality on a number of bases. Prime amongst them was the unreality of introducing the notion of the supply of another service into a transaction involving nothing more of commercial substance than sale to, and purchase by, a customer of an international airline ticket. What the ACCC chose to describe as booking services were in reality no more than essential and inseparable incidents of selling a ticket to a customer, and an airline selling a ticket directly to a customer could not realistically be described as supplying a distribution service to itself44. 42 Australian Competition and Consumer Commission v Flight Centre Ltd (No 2) (2013) 307 ALR 209 at 244 [135]. 43 Australian Competition and Consumer Commission v Flight Centre Ltd (No 2) (2013) 307 ALR 209 at 244 [137]-[138], 245 [142]. 44 Flight Centre Ltd v Australian Competition and Consumer Commission (2015) 234 FCR 367 at 395 [134], 397-398 [149]-[150]. The Full Court accepted that Flight Centre competed with the airlines for the sale of airline tickets to customers. The Full Court described that competition as occurring in a market for "the supply of international passenger air travel services" to customers, as advanced by the ACCC as its secondary case. The Full Court noted that the ACCC had not appealed from the primary judge's rejection of its secondary case45. The Full Court expressed the view that, in any event, the circumstance that Flight Centre sold airline tickets and provided ancillary and other services to customers as agent for the airlines meant that Flight Centre's sales of tickets and provision of those services to customers were not to be treated as acts of its own but rather as acts for and on behalf of the airlines. The competition between Flight Centre and the airlines was not competition between suppliers who competed in any market as principals, and for that reason was not relevant for the purposes of s 45A of the Act46. The Full Court summarised its conclusions as follows47: "The impugned conduct, the agreements proposed in Flight Centre's emails to the airlines, did not occur in a market in which Flight Centre and the airlines both supplied services in competition with each other. It occurred in the market for the supply of international passenger air travel services: a market in which the primary judge correctly found (and the ACCC does not now dispute) Flight Centre was agent for, and did not relevantly compete with, the airlines. To the extent that the conduct involved the fixing of prices, it was not caught by the deeming provision in s 45A because it did not occur in a market in which Flight Centre and the airlines competed in respect of the supply of services, as required by s 45A of the Act. The primary judge erred in concluding otherwise." The Full Court allowed Flight Centre's appeal, set aside the primary judge's orders and dismissed the proceeding. 45 Flight Centre Ltd v Australian Competition and Consumer Commission (2015) 234 FCR 367 at 370 [8], 402-403 [173]-[175]. 46 Flight Centre Ltd v Australian Competition and Consumer Commission (2015) 234 FCR 367 at 398 [152]-[153], 400 [162]-[163], 403 [181]. 47 Flight Centre Ltd v Australian Competition and Consumer Commission (2015) 234 FCR 367 at 404 [182]. Appeal to this Court In its appeal by special leave to this Court, the ACCC seizes on the Full Court's recognition of Flight Centre having competed with the airlines for the sale of tickets to customers to re-enliven its secondary case in a somewhat more focussed manner. The circumstance that Flight Centre sold only as agent for each airline, the ACCC argues, did not disqualify Flight Centre's sale of an airline's tickets from having been a supply by Flight Centre in a market in competition with that airline. There can be no doubt as to the jurisdiction of this Court to entertain the ACCC's argument notwithstanding the ACCC's failure to put that argument to the Full Court48. Flight Centre protests, but acknowledges that the ACCC's re- enlivened secondary case falls within the scope of the issues joined before the primary judge and points to no forensic prejudice49. Flight Centre's substantive response is pitched at the level of principle. An agent, it says, does not compete with the agent's principal for the supply of the principal's services. The nature of Flight Centre's competition with each airline for the sale of that airline's tickets to customers, it says, was no different from the nature of the rivalry which might have existed between that airline's own internal sales staff jostling each other to obtain sales commission: the competition related to supplies in a market, but was not competition between suppliers in that market. The ACCC persists in the appeal with its primary case that Flight Centre competed with each airline in markets for distribution services to international airlines and for booking services to customers. The ACCC argues that the rejection of its primary case by the Full Court resulted from a failure to take a sufficiently functional approach to market definition. That separate aspect of the ACCC's argument is best addressed before turning to the question of agency. Limits of the functional approach The critical condition for the application of s 45A, it will be recalled, was that the services in relation to which a price was fixed, controlled or maintained were supplied by one party to the contract, arrangement or understanding in competition with the other party. Section 45(3) operated with s 4E to require that competition to occur in a market in which the other party supplied either the 48 Crampton v The Queen (2000) 206 CLR 161 at 171-172 [12]-[14], 182-184 [47]- [52], 214 [148]-[150], 216 [155]; [2000] HCA 60. 49 Cf Suttor v Gundowda Pty Ltd (1950) 81 CLR 418 at 438-439; [1950] HCA 35. same services or services that were substitutable for, or otherwise competitive with, those services. A market is a metaphorical description of an area or space (which is not necessarily a place) for the occurrence of transactions. Competition in a market is rivalrous behaviour in respect of those transactions. A market for the supply of services is a market in which those services are supplied and in which other services that are substitutable for, or otherwise competitive with, those services also are actually or potentially supplied. A market is commonly defined by reference to its dimensions. The dimensions of a market are commonly described in terms of product (the types of services supplied), function (the level within a supply chain at which those services are supplied) and geography (the physical area within which those services are supplied). A market might sometimes also usefully be described as having a temporal dimension (referring to the period within which the supplies occur). No issue has been raised in this case about either of the last two of those dimensions of market definition. The controversy has been about the first, and to a lesser extent about the second. Flight Centre and the airlines transact within the chain of supply of what the ACCC chooses to describe as international passenger air travel services to customers. But what, relevantly, do they supply, to whom, and at what price? The question does not necessarily admit of a unique answer. Because "[t]he economy is not divided into an identifiable number of discrete markets into one or other of which all trading activities can be neatly fitted", the identification and definition of a market for particular services will often involve "value judgments about which there is some room for legitimate differences of opinion"50. Identifying a market and defining its dimensions is "a focusing process", requiring selection of "what emerges as the clearest picture of the relevant competitive process in the light of commercial reality and the purposes of the law"51. The process is "to be undertaken with a view to assessing whether the substantive criteria for the particular contravention in issue are satisfied, in the commercial context the subject of analysis"52. "The elaborateness of the 50 Queensland Wire Industries Pty Ltd v Broken Hill Proprietary Co Ltd (1989) 167 CLR 177 at 196; [1989] HCA 6. 51 Singapore Airlines Ltd v Taprobane Tours WA Pty Ltd (1991) 33 FCR 158 at 178. 52 Australian Competition and Consumer Commission v Australia and New Zealand Banking Group Ltd (2015) 236 FCR 78 at 107 [137]. exercise should be tailored to the conduct at issue and the statutory terms governing breach"53. Market definition is in that sense purposive or instrumental or functional. The functional approach to market definition is taken beyond its justification, however, when analysis of competitive processes is used to construct, or deconstruct and reconstruct, the supply of a service in a manner divorced from the commercial context of the putative contravention which precipitates the analysis. Castlemaine Tooheys Ltd v Williams & Hodgson Transport Pty Ltd54 is an illustration. There a brewer supplied beer to retailers, offering retailers the choice of collecting the beer from the brewer's depot for one price or having the beer delivered to the retailer's premises for a higher price. The brewer contracted with a particular haulage contractor to make the deliveries. A rival haulage contractor claimed that the brewer was engaged in the practice of exclusive dealing in contravention of ss 47(1) and 47(6) of the Act, the claimed contravention being constituted by the brewer supplying beer to a retailer on condition that the retailer acquire haulage services from the preferred contractor. The claim failed on the basis that what the brewer supplied and what the retailer acquired was in reality nothing other than delivered beer. Wilson J explained55: "Here the transactions under scrutiny encompassed no more than the supply of goods. The beer was to be supplied at the premises of the retailer. Each supply was a single transaction which could not be broken up into its several elements of sale and delivery without doing violence to the reality. Delivery to the premises was an essential and therefore In different inseparable concomitant of the supply of the beer. circumstances it might well be appropriate to characterize the delivery of the goods as the supply of a service. But not here. No question of supplying a service arises." The ACCC's primary case encounters essentially the same problem as did the claim in Castlemaine Tooheys. The problem is one of economic theory doing violence to commercial reality. The ACCC attempts to map the processes of competition between Flight Centre and the airlines to the second condition of s 45A(1) by advancing as its 53 Brunt, "'Market Definition' Issues in Australian and New Zealand Trade Practices Litigation", (1990) 18 Australian Business Law Review 86 at 127. 54 (1986) 162 CLR 395; [1986] HCA 72. 55 (1986) 162 CLR 395 at 403. primary case that the price fixed, controlled or maintained was Flight Centre's commission and that the services to which that price related were distribution services to international airlines and booking services to customers. Essential to that case was that Flight Centre supplied at least one of those services in a market in which the airline supplied the same services or services that were substitutable for, or otherwise competitive with, those services. There is no want of realism in describing Flight Centre as having provided distribution services to an airline when selling that airline's ticket to a customer in accordance with the Agency Agreement. It is quite artificial, however, to describe the same airline as having provided those services (or any other services) to the airline itself when selling a ticket directly to a customer. Booking the flight, issuing the ticket and collecting the fare were part and parcel of the airline making the sale. They were inseparable concomitants of that sale. Conversely, what a customer acquired when purchasing an international airline ticket could not realistically be described as more than the ticket. That was so whether the customer purchased from Flight Centre or directly from an airline. No doubt, an element of customer service was involved in making the sale. But that element of service was inseparable from the sale transaction. It was no different in kind, and little different in degree, from the attention to the requirements of the individual customer typically involved in the retail sale of a motor vehicle or of a pair of shoes. Whatever other difficulties the ACCC's primary case might encounter, it was unsustainable because it rested on attributing to Flight Centre and to the airlines the making of supplies of services of a description which did not accord with commercial reality. The Full Court's rejection of the primary case was for that reason correct. Agency and competition The term "agency" is "used in the law to connote an authority or capacity in one person to create legal relations between a person occupying the position of principal and third parties"56. An agent is "a person who is able, by virtue of authority conferred upon him, to create or affect legal rights and duties as between another person, who is called his principal, and third parties"57. 56 International Harvester Co of Australia Pty Ltd v Carrigan's Hazeldene Pastoral Co (1958) 100 CLR 644 at 652; [1958] HCA 16. 57 Petersen v Moloney (1951) 84 CLR 91 at 94; [1951] HCA 57. The relationship of agency is ordinarily created by contract between the principal and agent. Coexisting with the contractual relationship ordinarily is a fiduciary relationship in virtue of which the agent is constrained by a duty of loyalty to exercise the authority conferred by the principal in the interests of the principal, to the exclusion of the interests of the agent. Nevertheless, "it is the contract that regulates the basic rights and liabilities of the parties", with the result that "[t]he fiduciary relationship, if it is to exist at all, must accommodate itself to the terms of the contract so that it is consistent with, and conforms to, them"58. Fundamentally, "the rights and duties of the principal and agent are dependent upon the terms of the contract between them, whether expressed or implied", as a consequence of which "[i]t is not possible to say that all agents owe the same duties to their principals: it is always necessary to have regard to the express or implied terms of the contract"59. The potential for competition to exist between an agent and a principal for the making of supplies in a market needs to be considered against that background of the general law of agency. Consideration of whether the Act admitted of that potential needs to start with how the core function of the agent of creating legal relations between the principal and third parties was characterised within the scheme of the Act. Within the scheme of the Act, a contractual right met the definition of a service and the conferral of a contractual right met the definition of a supply. The Act also specifically spelt out that supplying a service included agreeing to a supply of a service. Sufficiently on the first basis, but additionally on the second, making a contract conferring a right to a supply of a service was itself a supply of a service. That was so whether making the contract was conduct of a principal or an agent. Section 84(2) of the Act, the terms of which have been noted, deemed conduct engaged in by an agent of a corporate principal within the scope of the agent's authority to have been engaged in for the purposes of the Act also by the corporate principal. Importantly, the provision did not deem the conduct not to have been engaged in by the agent. The provision resulted instead in the conduct of the agent becoming for the purposes of the Act conduct of the principal as well as conduct of the agent. 58 Hospital Products Ltd v United States Surgical Corporation (1984) 156 CLR 41 at 97; [1984] HCA 64. 59 Kelly v Cooper [1993] AC 205 at 213-214. The Act therefore contained nothing inherently inconsistent with the notion of an agent and a principal both being suppliers of contractual rights against the principal. Nor did it contain anything inconsistent with the notion of an agent supplying contractual rights against the principal in competition with the principal supplying contractual rights directly against itself. Whether an agent had legal capacity to compete with a principal was left to the general law, which in turn left the existence of that capacity to the contract between the principal and the agent: to the scope of the authority conferred on the agent by the principal; and to the extent, if at all, to which the agent was constrained in the exercise of that authority by a duty of loyalty. An agent lacking authority to negotiate with third parties would lack the means of engaging in competition. An agent constrained by a contractual or fiduciary obligation to act only in the interests of the principal would lack both the requisite autonomy and the requisite incentive. To the extent that an agent might be free to act, and to act in the agent's own interests, the mere existence of the agency relationship did not in law preclude the agent from competing with the principal for the supply of contractual rights against the principal. Whether or not competition might exist in fact then depended on the competitive forces at play. taken the approach That position is broadly consistent with DaimlerChrysler AG v Commission of the European Communities60. The European Court of First Instance there held that prohibitions against agreements restricting competition61 had no application "where an agent, although having separate legal personality, does not independently determine his own conduct on the market, but carries out the instructions given to him by his principal ... with which he forms an economic unit"62. The contrast drawn was between an agent who "works for the benefit of his principal" and "who must carry out his principal's instructions" and an agent allowed by the terms of the agreement with the principal "to perform duties which from an economic point of view are approximately the same as those carried out by an independent dealer"63. The position in the United States concerning the relevance of agency to agreements in restraint of trade is more complex. The prevailing view has been 60 [2005] ECR II-3319. 61 Article 81(1) of the Treaty Establishing the European Community. 62 [2005] ECR II-3319 at II-3359 [88]. 63 [2005] ECR II-3319 at II-3358 [86]-[87]. to see the relationship of principal and agent as an exception to the per se rule against price fixing64. But the exception has come to be seen to have no application where "the agent is really a dealer". The line between agent on the one hand, and dealer or distributor or reseller on the other hand, has been acknowledged to be "indistinct" and to lie somewhere on a "continuum bounded at one end by the manufacturer's full-time employees and at the other by vast, autonomous distribution enterprises". The appropriate inquiry has in those circumstances been said to necessitate a multifactorial objective determination of "whether the agency relationship has a function other than to circumvent the rule Adopting that approach, the United States Court of Appeals for the Seventh Circuit held, in Illinois Corporate Travel Inc v American Airlines Inc66, that a travel agent was an agent of an airline as distinct from a reseller of the airline's tickets, with the result that the airline did not contravene the per se rule against price fixing in refusing to allow a travel agent to rebate part of the travel agent's commission to purchasers of the airline's tickets. Important to the analysis in that case were the market circumstances that airlines established and publicised the prices of tickets, thereby setting and bearing the risk associated with their own marketing strategies, and that travel agents were exposed to no financial risk in making sales other than the potential loss of commission on a refunded ticket67. The circumstances of this case are not the same as Illinois Corporate Travel. And the inquiry undertaken in that case is not the same as that required for the purposes of the Act. Critical to the outcome of the ultimate question of whether Flight Centre sold international airline tickets to customers in a market in competition with the airlines are two considerations. The first is that Flight Centre's authority under the Agency Agreement extended not only to deciding whether or not to sell an airline's tickets but also to setting its own price for those tickets. The second is that there is no suggestion that Flight Centre was constrained in the exercise of that authority to prefer the interests of the airlines to its own. 64 United States v General Electric Co 272 US 476 (1926). 65 Morrison v Murray Biscuit Co 797 F 2d 1430 at 1436-1438 (1986). 66 806 F 2d 722 (1986). 67 806 F 2d 722 at 725-726 (1986). See also Illinois Corporate Travel Inc v American Airlines Inc 889 F 2d 751 at 753 (1989). Flight Centre was free in law to act in its own interests in the sale of an airline's tickets to customers. That is what Flight Centre did in fact: it set and pursued its own marketing strategy, which involved undercutting the prices not only of other travel agents but of the airlines whose tickets it sold. When Flight Centre sold an international airline ticket to a customer, the airline whose ticket was sold did not. The competition which the Full Court accepted to have occurred in fact was not, as Flight Centre seeks to put it, merely competition in relation to supplies in a market. It was competition between suppliers in a market. The outcome of the appeal does not turn on the precise dimensions of that market. The ACCC's persistence in describing it as a market for international passenger air travel services nevertheless tends to blur the product and functional dimensions of the market in a way which obscures the point that the supplies for which Flight Centre and the airlines competed were not supplies of carriage services but rather supplies of contractual rights to carriage services. The market is better identified as having been a market for the supply of contractual rights to international air carriage to customers or, in short, as a market for international airline tickets. Conclusion and orders The appeal should be allowed. The primary judge's declarations of contravention of s 45(2)(a)(ii) should stand, with adjustments to reflect the ACCC's success in establishing its secondary case as distinct from its primary case concerning satisfaction of the second condition of s 45A(1). In recognition of its failure to pursue that secondary case in the Full Court, the ACCC should not have its costs of the appeal to this Court and should not have its costs to date of the appeal to the Full Court. The following orders should be made: Appeal allowed. Set aside the order of the Full Court of the Federal Court of Australia made on 31 July 2015, and in its place order that: the appeal be allowed in part; the respondent be granted leave to file its amended notice of cross-appeal dated 3 August 2016; the cross-appeal be allowed in part; the declaration made by Logan J on 28 March 2014 be varied as follows: (iii) in paragraph 1, omit the words "distribution and booking services for international passenger air the words travel" "international airline tickets"; them with replace and in each of paragraphs 1(a), (b), (c), (d), (e) and (f), omit the words "distribution and booking"; in each of paragraphs 1(a), (b) and (f), omit the words "the retail or distribution margin received by Flight Centre for its booking and distribution services would be maintained" and replace them with the words "the price Flight Centre charged for its supply of international airline tickets would be maintained, and that the price Singapore Airlines charged for its supply of international airline tickets would be fixed, controlled or maintained"; in each of paragraphs 1(c) and (d), omit the words "the retail or distribution margin received by Flight Centre for its booking and distribution services would be maintained" and replace them with the words "the price Flight Centre charged for its supply of international airline tickets would be maintained, and that the price Emirates charged for its supply of international airline tickets would be fixed, controlled or maintained"; and in paragraph 1(e), omit the words "the retail or distribution margin received by Flight Centre for its booking and distribution services would be maintained" and replace them with the words "the price Flight Centre charged for its supply of international airline tickets would be maintained, and that the price Malaysia Airlines charged for its supply of international airline tickets would be fixed, controlled or maintained"; and each party bear its own costs of the proceedings in the Full Court to date. Remit the matter to the Full Court of the Federal Court of Australia for the determination of the appeal and cross-appeal insofar as they relate to penalty. Nettle NETTLE J. This is an appeal from a decision of the Full Court of the Federal Court of Australia (Allsop CJ, Davies and Wigney JJ) that, for the purposes of the Trade Practices Act 1974 (Cth) (now the Competition and Consumer Act 2010 (Cth)), the respondent ("Flight Centre") was not relevantly in competition with airlines for which it sold airline tickets as an agent, and thus had not engaged in anti-competitive conduct contrary to s 45(2)(a)(ii) of the Trade Practices Act. Before this Court, the appellant ("the ACCC") advanced two theories as to the competition between Flight Centre and certain airlines68. Its primary case was that Flight Centre and the airlines were in competition with each other in either or both of a market for the supply of distribution services to airlines or a market for the supply of booking services to customers. The alternative case, as finally propounded, was that Flight Centre and the airlines were in competition with each other in a market for the sale of airline tickets to customers. It was not in dispute that if the Court found that Flight Centre was in competition with the airlines in one of the supposed markets Flight Centre would have engaged in anti-competitive conduct contrary to s 45(2)(a)(ii) of the Trade Practices Act. For the reasons which follow, the alternative case should be accepted and the appeal should be allowed. The facts (i) Flight Centre's business Flight Centre operated a travel agency business in Australia and overseas comprised of a large network of shopfronts and call centres, as well as an internet presence. Its employees included "travel consultants" who dealt directly with potential customers. One of Flight Centre's main areas of business was the sale of international passenger air travel services to customers on behalf of airlines. Flight Centre did not operate any aircraft. Flight Centre offered customers travel advice and facilitation services that included advice about particular overseas destinations and the availability of flights offered by different airlines to those destinations, the booking of international air travel on behalf of customers and the receipt of payment from customers for that air travel ("booking services"). Flight Centre provided booking services via direct contact with customers in its shops and by telephone. The booking of international air travel with Flight Centre was not available via the internet. 68 The relevant airlines in this case were Emirates, Malaysia Airlines and Singapore Airlines ("the airlines"). Nettle Simultaneously, Flight Centre provided distribution services to the airlines, by disseminating to the public information about the availability of each airline's flights and by dealing with potential passengers in relation to ticketing ("distribution services"). Cumulatively, Flight Centre performed the role of an intermediary by contracting with a customer for carriage on a particular flight on behalf of the airline concerned, but in doing so acted on behalf of the customer concerned. (ii) Flight Centre's relationship with the airlines Airlines used the distribution network of third parties, like Flight Centre, to make the availability of their air travel services known to potential passengers. At the same time, as an alternative to dealing through an intermediary, airlines offered tickets for sale directly to the public (a process described as "disintermediation"). Potential passengers could therefore book a flight either through an intermediary, like Flight Centre, or directly with an airline. Flight Centre's reward for securing a customer's booking on behalf of an airline, and similarly an airline's reward for securing that booking directly, was an amount of money (described as the "retail or distribution margin"), which was part of the grossed-up fare paid by the passenger for the airline ticket. Sometimes, travel agents, including Flight Centre, also charged customers a separate "service fee". At relevant times, international airlines used several different Global Distribution Systems ("GDS") to make flights available for sale by travel agents. Relevantly, each airline did that by loading the airline's "published fare" onto the GDS. An airline's published fare was the price determined by the airline for a particular airline ticket. It included an amount of "at-source commission" and so enabled the calculation of the "nett fare" that the travel agent was required to remit to the airline on sale of the ticket. Flight Centre was party to a standard form Passenger Sales Agency Agreement ("the PSAA") made between individual travel agents and the International Air Transport Association ("IATA") on behalf of its members. Each of the airlines was a member of IATA and, therefore, party to the PSAA with Flight Centre. Under that agreement, Flight Centre was free to promote and sell any of the airlines' flights, but whenever Flight Centre entered into a transaction with a customer by issuing a ticket for a flight on a particular airline, Flight Centre did so as agent for that airline. On receipt of the fare from the customer, Flight Centre was bound forthwith to remit the fare, less at-source commission, to the airline. Nettle (iii) Rivalry and competition between Flight Centre and the airlines Under the PSAA, Flight Centre was free to sell an airline ticket at any price it chose. But, regardless of the price at which it sold an airline ticket, Flight Centre remained bound to remit the nett fare to the airline. Consequently, if Flight Centre sold an airline ticket at a price above the published fare, Flight Centre received a margin greater than the at-source commission included in the published fare; if it sold an airline ticket at a price below the published fare, it received a margin less than the at-source commission; and, if it sold an airline ticket at a price below the nett fare, it made a loss on the sale. Flight Centre was, however, also free to set and impose additional service fees. As part of its marketing strategy, Flight Centre advertised that it would better the price for an airline ticket quoted by any other Australian travel agent or website, including websites operated by airlines, by $1, and that it would give the potential customer a voucher for $20 ("the Price Beat Guarantee"). As a result of customers being able to cite a lower fare available directly from an airline's website, the financial cost to Flight Centre of honouring the Price Beat Guarantee became of enduring and increasing commercial concern to Flight Centre and a key threat to Flight Centre's business. There was also a separate but related concern that Flight Centre was losing sales to the airlines as a result of customers dealing directly with airlines via their websites. During the relevant period, there was a discernible trend of airlines bypassing intermediaries, like Flight Centre, by making greater use of the internet to offer airline tickets for sale directly to customers at prices less than the published fares available on the GDS. Flight Centre referred in its internal documents to such direct sales as "External Threats" and "Industry or Market Driving Forces", and recorded that direct sales created two particular problems for its business. The first was the risk of losing sales to the airlines when potential customers chose to deal directly with an airline via its website in light of the lower fares there available. The second was Flight Centre needing to better fares offered directly by the airlines in order to secure sales, particularly under the Price Beat Guarantee, and therefore making a loss on those sales. Flight Centre thus recognised that it was in competition with airlines offering direct sales to customers. At trial, there was also evidence from two other market participants, Mr Clarke, the Chairman of Webjet Ltd, an online travel agency, and Ms Schwass, the operator of Travel by Tracey, a travel agency shopfront business. They deposed that they regarded themselves as being in competition with airlines which made direct sales to customers. Their evidence was consistent with the evidence of the only expert called at trial, an economist named Dr FitzGerald. Dr FitzGerald stated that in his opinion: Nettle "travel agents do compete – horizontally – with international airlines at the retail level of the international travel market. This is very clearly so, since if one makes the sale, the other does not. What they are competing for at this level, of course, is the retail or distribution margin". (emphasis in original, footnote omitted) Dr FitzGerald identified a single overarching market for international travel and ancillary products with downstream and upstream levels. He said that booking services were supplied downwards by travel agents and airlines (selling directly) to customers, and distribution services were supplied upwards by travel agents to the airlines and by airlines to themselves (through "self-supply", which eliminated the need to use a third party). In Dr FitzGerald's opinion, the relevant market was best identified as the downstream or distribution functional level of the single overarching market in which travel agents compete with airlines for the supply of booking and distribution services. Dr FitzGerald's opinion was consistent with the ACCC's primary case but, of course, that is not determinative. Expert evidence may provide a measure of assistance in appreciating the applicable economic principles but, ultimately, it is for the court to discern and define the relevant market as a question of fact69. (iv) The impugned conduct Between 19 August 2005 and 16 May 2009, Flight Centre sent six series of emails to the airlines evidencing the rivalry or competition between Flight Centre and the airlines in relation to the sale of tickets and attempting to persuade the airlines not to engage in further direct sales to customers at discounted prices ("the emails"). It is that conduct which the ACCC alleged was contrary to s 45(2)(a)(ii) of the Trade Practices Act. Relevant legislation At relevant times, s 45 of the Trade Practices Act provided, so far as is relevant, as follows: "(2) A corporation shall not: (a) make a contract or arrangement, or arrive at an understanding, if: the proposed contract, arrangement or understanding contains an exclusionary provision; or 69 Trade Practices Commission v Australia Meat Holdings Pty Ltd (1988) 83 ALR Nettle a provision of the proposed contract, arrangement or understanding has the purpose, or would have or be likely to have the effect, of substantially lessening competition; or give effect to a provision of a contract, arrangement or understanding, whether the contract or arrangement was made, or the understanding was arrived at, before or after the commencement of this section, if that provision: is an exclusionary provision; or has the purpose, or has or is likely to have the effect, of substantially lessening competition. (3) For the purposes of this section and section 45A, competition, in relation to a provision of a contract, arrangement or understanding or of a proposed contract, arrangement or understanding, means competition in any market in which a corporation that is a party to the contract, arrangement or understanding or would be a party to the proposed contract, arrangement or understanding, or any body corporate related to such a corporation, supplies or acquires, or is likely to supply or acquire, goods or services or would, but for the provision, supply or acquire, or be likely to supply or acquire, goods or services." Section 45A provided, so far as is relevant, that: "(1) Without limiting the generality of section 45, a provision of a contract, arrangement or understanding, or of a proposed contract, arrangement or understanding, shall be deemed for the purposes of that section to have the purpose, or to have or to be likely to have the effect, of substantially lessening competition if the provision has the purpose, or has or is likely to have the effect, as the case may be, of fixing, controlling or maintaining, or providing for the fixing, controlling or maintaining of, the price for, or a discount, allowance, rebate or credit in relation to, goods or services supplied or acquired or to be supplied or acquired by the parties to the contract, arrangement or understanding or the proposed parties to the proposed contract, arrangement or understanding, or by any of them, or by any bodies corporate that are related to any of them, in competition with each other." "Market" was defined in s 4E as follows: "For the purposes of this Act, unless the contrary intention appears, market means a market in Australia and, when used in relation to any Nettle goods or services, includes a market for those goods or services and other goods or services that are substitutable for, or otherwise competitive with, the first-mentioned goods or services." "Services" were defined in s 4(1), as far as is relevant, as follows: "services includes any rights (including rights in relation to, and interests in, real or personal property), benefits, privileges or facilities that are, or are to be, provided, granted or conferred in trade or commerce ... but does not include rights or benefits being the supply of goods or the performance of work under a contract of service." "Supply" was defined in s 4(1) as follows: "supply, when used as a verb, includes: in relation to goods—supply (including re-supply) by way of sale, exchange, lease, hire or hire-purchase; and in relation to services—provide, grant or confer; and, when used as a noun, has a corresponding meaning ..." The proceeding at first instance At first instance, the ACCC put its case in two alternative ways. The ACCC's primary case was that Flight Centre and the airlines were in competition with each other in the market for intermediary booking and distribution services and that Flight Centre's conduct in sending the emails was an attempt to induce the airlines to enter into a contract, arrangement or understanding with Flight Centre that would prevent the airlines from undercutting Flight Centre through direct sales, thus protecting Flight Centre's retail or distribution margin in the market for the provision of one or other of those services. The ACCC's alternative case was that Flight Centre and the airlines were in competition with each other in the market for the provision of international air travel services and that Flight Centre's conduct in sending the emails was an attempt to induce the airlines to enter into a contract, arrangement or understanding with Flight Centre that would prevent the airlines from undercutting Flight Centre through direct sales, thereby protecting Flight Centre's retail or distribution margin in the market for the supply of international air travel services. In either event, it was contended, Flight Centre's conduct was an attempt to induce a contravention of s 45, as read with s 45A, of the Trade Practices Act. Nettle The primary judge found that Flight Centre and the airlines were in competition with each other in the market for intermediary booking and distribution services and that Flight Centre's conduct in sending the emails constituted "a concerted pattern of reactive corporate conduct"70 amounting to an attempt to induce each airline to enter into a contract, arrangement or understanding with Flight Centre the airline from undercutting Flight Centre through direct sales and thereby protect Flight Centre's retail or distribution margin in respect of booking and distribution services71. On that basis, his Honour held that Flight Centre's conduct was an attempt to induce a contravention of s 45, as read with s 45A, of the Trade Practices Act. that would prevent The appeal to the Full Court The Full Court were critical of the primary judge's finding that the relevant market in which Flight Centre's impugned conduct had occurred was one for booking and distribution services. Their Honours stated that a market so defined did not correspond to any of the markets pleaded, lacked precision and clarity, and was in any event artificial72. In the Full Court's view, the affixation of labels such as "intermediary services" or "booking and distribution services" tended to obscure, or at least did not significantly assist in, the proper consideration of the relevant supplies and the relevant market73. In reality, the Full Court held, an airline's conduct in selling an airline ticket directly to a customer (including the ancillary conduct of making the flight known to the customer and booking the flight) could not sensibly be regarded as the provision by the airline of a service to itself74. It "was in fact an artificial construct that did not truly reflect the commercial reality of the relevant commercial relationship and dealings"75. The Full Court considered that the primary judge's conclusion was also fraught because it required that distribution services supplied by airlines 70 Australian Competition and Consumer Commission v Flight Centre Ltd (No 2) (2013) 307 ALR 209 at 225-226 [82]. 71 Flight Centre (No 2) (2013) 307 ALR 209 at 261 [197]. 72 Flight Centre Ltd v Australian Competition and Consumer Commission (2015) 234 FCR 367 at 393 [126]-[127], 395 [134]. 73 Flight Centre (2015) 234 FCR 367 at 394 [129]. 74 Flight Centre (2015) 234 FCR 367 at 395-396 [134]-[137]. 75 Flight Centre (2015) 234 FCR 367 at 403 [176]. Nettle "in-house" be substitutable for the intermediary services supplied by Flight Centre and other agents; and they were not76. Although the ACCC did not persist with its alternative case before the Full Court, the Full Court recognised that there was rivalry between Flight Centre and the airlines "in respect of the market for the supply of international passenger air travel services"77, but held that it was not rivalry that existed "in a market in which both Flight Centre and the airlines supplied goods or services in competition with each other"78. Their Honours reasoned that was so because only the airlines supplied international passenger air travel services and "Flight Centre operated in the market for such services, but only as an agent for the airlines"79. The Full Court therefore concluded that80: "The impugned conduct, the agreements proposed in Flight Centre's emails to the airlines, did not occur in a market in which Flight Centre and the airlines both supplied services in competition with each other. It occurred in the market for the supply of international passenger air travel services: a market in which the primary judge correctly found (and the ACCC does not now dispute) Flight Centre was agent for, and did not relevantly compete with, the airlines. To the extent that the conduct involved the fixing of prices, it was not caught by the deeming provision in s 45A because it did not occur in a market in which Flight Centre and the airlines competed in respect of the supply of services, as required by s 45A of the Act. The primary judge erred in concluding otherwise." The appeal to this Court Before this Court, the ACCC once again sought to put its case on both the primary and alternative bases advanced at first instance. That course was opposed. Counsel for Flight Centre contended that, because the ACCC had put its case before the Full Court only on the primary basis of the supposed market for booking and distribution services and did not argue on the alternative basis of a market for the sale of airline tickets, the ACCC could not now be heard to say that the Full Court erred in failing to decide the case in favour of the ACCC on the alternative basis, which was not in issue before the Full Court. 76 Flight Centre (2015) 234 FCR 367 at 396 [138]. 77 Flight Centre (2015) 234 FCR 367 at 402 [173]. 78 Flight Centre (2015) 234 FCR 367 at 402-403 [175]. 79 Flight Centre (2015) 234 FCR 367 at 403 [175]. 80 Flight Centre (2015) 234 FCR 367 at 404 [182]. Nettle That contention should be rejected. Inasmuch as the ACCC put its case at first instance on both bases, Flight Centre had every opportunity to contest the argument that there was a market for the sale of airline tickets in which it and the airlines competed and to adduce evidence in opposition to that argument. It chose not to do so. Consequently, this is not a case where a respondent has been deprived of an opportunity properly to meet a case which is put against it for the first time on appeal81. Further, although when the matter was before the Full Court the ACCC did not press the argument that the primary judge's conclusion could be upheld on the alternative basis of a market for the sale of airline tickets, the issue as to Flight Centre's agency for the airlines in the supposed market for the supply of booking and distribution services was in essential respects identical to the agency issue in relation to the market for the sale of airline tickets. It is apparent from the Full Court's reasons that their Honours actively considered the possibility of upholding the primary judge's conclusion on the alternative basis of the market for the sale of airline tickets but rejected it for the sole reason that Flight Centre acted as each airline's agent in the sale of that airline's tickets82. That was also the only substantive basis on which Flight Centre sought to counter the ACCC's alternative case in this Court. Accordingly, this is not a case where this Court has been deprived of the advantage of the court below's consideration of the response to an argument. In substance, the position is as if the ACCC had persisted with its alternative argument before the Full Court and the Full Court had rejected it for the reason which in fact they gave. In those circumstances, it would be illogical and would ill-accord with a just disposition of this appeal to eschew consideration of the effect of Flight Centre's conduct on competition in the market for the sale of airline tickets. For the sake of good order, however, during the course of the hearing of this appeal, the ACCC sought leave nunc pro tunc to file an amended notice of cross-appeal to the Full Court and an amended notice of appeal to this Court, copies of which have since been provided to the Court. In order finally to regularise the position, leave was granted in respect of the amended notice of appeal to this Court and I agree with Kiefel and Gageler JJ that leave to file the amended notice of cross-appeal to the Full Court should now be granted. 81 Cf Suttor v Gundowda Pty Ltd (1950) 81 CLR 418 at 437-439; [1950] HCA 35; Coulton v Holcombe (1986) 162 CLR 1 at 7-8 per Gibbs CJ, Wilson, Brennan and Dawson JJ; [1986] HCA 33. 82 Flight Centre (2015) 234 FCR 367 at 402-403 [173]-[176]. Nettle The market for booking and distribution services For the reasons which the Full Court gave, and for the reasons which Kiefel and Gageler JJ give, the Full Court were correct to hold that the supposed market for the provision of booking and distribution services was an artificial construct that does not truly engage the commercial reality of the relevant commercial relationship and dealings, and thus that Flight Centre and the airlines were not in competition with each other in any such market. The market for the sale of airline tickets The Full Court were incorrect, however, to find that Flight Centre and the airlines were not in competition with each other in the market for the provision of international air travel services or, more precisely, for the sale of international airline tickets. It is true, as the Full Court found, that only the airlines operated aircraft and, in that sense, only the airlines were capable of supplying the service of carrying passengers by air from one international destination to another. Flight Centre neither operated aircraft, nor undertook to carry passengers by air, whether by itself or through any agent. But, as was earlier recorded, "services" were expansively defined in s 4(1) of the Trade Practices Act as including "any rights ... benefits, privileges or facilities that are, or are to be, provided, granted or conferred in trade or commerce", and "supply" also was expansively defined as including, in relation to services, "provide, grant or confer". It requires no extension of the natural and ordinary meaning of those words as defined to characterise the sale of an airline ticket by a travel agent, like Flight Centre, to a customer as a supply to that customer of the right, enforceable against the relevant airline, to be carried by that airline on the flight to which the ticket relates. It is also true, as the Full Court found83, that whenever Flight Centre sold an airline ticket to a customer it did so as agent for the relevant airline. But, as will be seen, on the facts of this case, to say that Flight Centre acted as the agent of the airline means no more than that Flight Centre was endowed by the relevant airline with authority to create in favour of the customer the right to be carried by the airline on the flight for which the airline ticket was provided. As defined in s 4E of the Trade Practices Act, a market for goods or services means a "market for those goods or services and other goods or services that are substitutable for, or otherwise competitive with, the first-mentioned goods or services". Ultimately, therefore, the existence of a market for goods or services is determined by the extent of their substitutability. Substitutability is, however, a matter of degree. The greater the degree of substitutability between 83 Flight Centre (2015) 234 FCR 367 at 394 [131]. Nettle goods or services, the greater the degree of competition between suppliers of those goods or services, and vice versa84. A market for goods or services within the meaning of s 4E is taken to exist where there is such a degree of substitutability between the goods or services of suppliers in the same or a related geographic area, and thus such competition between them, that the market power of each is significantly constrained85. From the point of view of a prospective customer, an airline ticket sold by Flight Centre on behalf of an airline would be in most respects functionally identical to an airline ticket sold directly by the airline. Apart, perhaps, from the prospective customer's perception of extra sales service and purchasing convenience, the only difference between the two offerings would be price. Consequently, from the point of view of the prospective customer, the airline ticket sold by Flight Centre on behalf of an airline would be close to perfectly substitutable for the airline ticket sold directly by the airline; and, in terms of generally accepted competition principles86, that means that the cross-price elasticity of demand as between an airline ticket sold by Flight Centre and an airline ticket sold directly by the airline would approach positive infinity. Other things being equal, that connotes a high degree of competition between airline tickets sold by Flight Centre on behalf of airlines and airline tickets sold directly by each airline87 and, therefore, the existence of a market for the sale of airline tickets in which both Flight Centre and the airlines competed. When dealing with the ACCC's primary contention that Flight Centre was in competition with the airlines in the market for the supply of booking and distribution services, the Full Court observed, correctly, that one of the difficulties with the argument was that, because each airline sold only its own tickets, a market for booking services could only exist in relation to the airline tickets of a particular airline88. That difficulty does not arise, however, in 84 Arnotts Ltd v Trade Practices Commission (1990) 24 FCR 313 at 331-332. 85 Queensland Wire Industries Pty Ltd v Broken Hill Proprietary Co Ltd (1989) 167 CLR 177 at 187-189 per Mason CJ and Wilson J, 196 per Deane J; [1989] HCA 6; Singapore Airlines Ltd v Taprobane Tours WA Pty Ltd (1991) 33 FCR 158 at 178 per French J, citing Areeda and Kaplow, Antitrust Analysis, 4th ed (1988) at 572; Monroe Topple & Associates Pty Ltd v Institute of Chartered Accountants in Australia (2002) 122 FCR 110 at 144 [135]-[136] per Tamberlin J. 86 Ruffin, Modern Price Theory, (1988) at 114-115; Call and Holahan, Microeconomics, 2nd ed (1983) at 67. 87 Ruffin, Modern Price Theory, (1988) at 114-115. See also Wold, Demand Analysis, (1953). 88 Flight Centre (2015) 234 FCR 367 at 400-401 [164]. Nettle relation to the market for the sale of airline tickets. Although each airline sold only its own tickets, each airline was in competition with each other airline for the sale of airline tickets and Flight Centre sold all of the airlines' tickets. Possibly, the degree of substitutability between the different airlines' tickets was not as complete as that between an airline's ticket sold by Flight Centre on behalf of the airline and an airline's ticket sold by that airline directly. There might have been sufficient actual or perceived differences in terms of quality and convenience that the choice between the offerings of different airlines was not entirely dependent on price. But it was never suggested that such differences resulted in there being other than a very high level of price competition between the airlines for the sale of their respective tickets. To the contrary, the evidence of Flight Centre's appreciation of the difficulties posed by the airlines' conduct in selling tickets directly, and the evidence of Mr Clarke and Ms Schwass as to the economic pressures to which their businesses were subject, left no doubt that Flight Centre's ability to sell one airline's tickets at prices satisfactory to Flight Centre was constrained almost as much by prices set by other airlines for the sale of their competing tickets as it was by the prices set by the subject airline for the sale of its tickets directly to customers89. The market in which Flight Centre was in competition with each of the airlines was, therefore, the market for airline tickets in respect of all airlines. Sales as agent The Full Court took the view that, because Flight Centre sold airline tickets as the agent of the airlines, only the airlines – and not Flight Centre – were in competition with each other for the sale of airline tickets90. Before this Court, counsel for Flight Centre argued in support of that view that, because every sale made by Flight Centre as agent for an airline increased the airline's sales generally, it was illogical to speak of the airlines being in competition with Flight Centre. The reality, counsel submitted, was that it was inevitably to the advantage of the airline for Flight Centre to sell as many of the airline's tickets as possible, at whatever price Flight Centre chose. That submission should be rejected. It overlooks the fact that, although the airline's interest in Flight Centre selling the airline's tickets as an agent was to some extent informed by the number of tickets sold by Flight Centre, it was also 89 See and compare Rural Press Ltd v Australian Competition and Consumer Commission (2003) 216 CLR 53 at 72-73 [45] per Gummow, Hayne and Heydon JJ; [2003] HCA 75; Boral Besser Masonry Ltd v Australian Competition and Consumer Commission (2003) 215 CLR 374 at 457 [257] per McHugh J; [2003] HCA 5; Arnotts (1990) 24 FCR 313 at 334. 90 Flight Centre (2015) 234 FCR 367 at 404 [182]. Nettle affected by the amount of the commission which Flight Centre was paid for its services as agent. Contrary to Flight Centre's submissions, it may be inferred from the fact that the airlines commenced to sell tickets directly to customers that, to the extent that each airline was able to sell tickets directly to customers rather than through Flight Centre as its agent, the airline preferred to do so because it avoided the need to pay commission on those sales. Some self-serving correspondence sent by the airlines to Flight Centre at the time of the impugned conduct does not significantly detract from the strength of that inference. Plainly enough, Flight Centre and the airlines were in competition for the sale of airline tickets, with the result that an arrangement between Flight Centre and the airlines to fix the prices at which the airlines were prepared to sell when dealing directly with customers would have had or been likely to have had the effect of reducing the level of competition between Flight Centre and the airlines in that market. Counsel for Flight Centre contended that, because Flight Centre sold an airline's tickets as agent for that airline, Flight Centre's position vis-à-vis the airline was relevantly no different from the position of an in-house, captive, commission-based salesperson. In counsel's submission, it would be nonsense to suppose that, when such a salesperson attempts to influence his or her principal to raise prices in order to increase the amount of the salesperson's commission, he or she thereby engages in anti-competitive conduct. Rather, such events are properly to be regarded as the principal being supplied with information by the in-house salesperson as to the best price able to be charged by the principal without prejudicing staff relations with the salesperson. Counsel argued that it was the same when Flight Centre supplied information to the airlines as to the best price which could be set by the airlines for direct sales while maintaining a satisfactory relationship with Flight Centre as its commission-based agent. That submission should also be rejected. The supposed analogy between an in-house, captive, commission-based salesperson and Flight Centre is inapt. Ex hypothesi, in the case of the salesperson, the principal retains contractual power to determine the level of prices at which the salesperson is permitted to sell the principal's products. For that reason, the salesperson is incapable of putting downward competitive pressure on those prices91. By contrast, Flight Centre had an unimpeded contractual right to determine the prices at which it sold an airline's tickets to customers and, consequently, a contractually unimpeded power to put downward competitive pressure on the prices charged by the airline for its tickets in direct sales. It follows that for Flight Centre to propose to the airlines that the airlines increase their prices for the purpose of direct sales was necessarily to propose a lessening of downward competitive 91 United States v General Electric Co 272 US 476 at 488 (1926); Illinois Corporate Travel Inc v American Airlines Inc 806 F 2d 722 at 724-725 (7th Cir 1986). Nettle pressure on prices and, consequently, a reduction in the level of competition between Flight Centre and the airlines for the sale of airline tickets. Counsel for Flight Centre called in aid a number of judgments from courts in the United States of America which he submitted showed that it ought not be considered anti-competitive conduct for a manufacturer to set the prices at which it requires its dealers and distributors to sell its goods. He instanced in particular the decisions of the Supreme Court of the United States in United States v General Electric Co92 and Simpson v Union Oil Co of California93 and the decisions of the United States Court of Appeals in Morrison v Murray Biscuit Company94 and Illinois Corporate Travel Inc v American Airlines Inc95. Those decisions, however, are either distinguishable or, properly understood, opposed to Flight Centre's contentions. It is convenient to begin with Murray Biscuit. Murray Biscuit Company ("Murray Biscuit") was a manufacturer of biscuits that distributed its products through brokers and wholesale distributors. Brokers were commission-based agents who took orders from grocery stores in assigned territories for the purchase of Murray Biscuit products at prices set by Murray Biscuit. Each broker was required to forward all orders to Murray Biscuit, which would then fill each order directly by sending the ordered goods to the purchasing grocery store and invoicing and receiving payment from that store. Thereafter, Murray Biscuit remitted a commission of five per cent of the invoiced price to the broker "as compensation for [the broker's] services"96. In contrast, distributors were independent wholesalers to whom Murray Biscuit sold and delivered its products at wholesale prices, which were eight per cent below the price offered to grocery stores in brokered sales97. Once a distributor had so bought and paid for Murray Biscuit products, the distributor was free to re-sell the products to grocery stores at whatever prices the distributor chose. Morrison was one of Murray Biscuit's distributors. After some time and correspondence, Murray Biscuit terminated Morrison's distribution agreement on the basis of complaints by one of Murray Biscuit's brokers that Morrison was operating in the broker's territory and undercutting the broker's invoiced prices98. Morrison brought an action against 94 797 F 2d 1430 (7th Cir 1986). 95 806 F 2d 722 (7th Cir 1986). 96 Murray Biscuit 797 F 2d 1430 at 1434 (7th Cir 1986). 97 Murray Biscuit 797 F 2d 1430 at 1434-1435 (7th Cir 1986). Nettle Murray Biscuit alleging a conspiracy between Murray Biscuit and the broker to suppress price competition, contrary to the Sherman Anti-Trust Act99. Morrison's action against Murray Biscuit failed because it was held that there was insufficient evidence of Murray Biscuit having agreed with either Morrison or the broker as to the prices to be charged for its products100. Although it was recognised that the broker's complaints suggested the existence of a price-fixing agreement to which Morrison was party, it was considered equally possible that the real substance of the broker's complaint was that Murray Biscuit had failed to bind Morrison to an agreement as to a price floor, or simply that Morrison had entered the broker's territory and undercut the broker's prices by increasing supply101. Thus, to a very large extent, the decision in Murray Biscuit turned on its own facts. Counsel for Flight Centre contended that the real significance of Murray Biscuit was, however, the Court of Appeals' observations concerning the apparent tension between the Supreme Court's reasoning in General Electric and later in Union Oil. In General Electric, it was held that it was not a contravention of the Sherman Anti-Trust Act for a supplier to fix the prices to be charged by its agents for sale of the supplier's goods102. By contrast, in Union Oil, it was held that it was a contravention of the Sherman Anti-Trust Act for an oil company to fix the prices at which its retail dealers were permitted to sell gasoline to the public, even though the retail dealers were, at law, the oil company's consignment agents, who received the gasoline on consignment from the oil company and sold it as agents for the company103. As the Court of Appeals stated in Murray Biscuit, given that the Supreme Court in Union Oil expressly declined104 to 98 Murray Biscuit 797 F 2d 1430 at 1435 (7th Cir 1986). 99 1890 (15 USC §§1-7), as amended by the Clayton Act 1914 (15 USC §§12-27), on which many of the anti-competition prohibitions of the Trade Practices Act were to some extent based: Melway Publishing Pty Ltd v Robert Hicks Pty Ltd (2001) 205 CLR 1 at 36-37 [91] per Kirby J; [2001] HCA 13. 100 Murray Biscuit 797 F 2d 1430 at 1435-1436 (7th Cir 1986). 101 Murray Biscuit 797 F 2d 1430 at 1435-1436 (7th Cir 1986). 102 General Electric 272 US 476 at 490, 493-494 (1926). 103 Union Oil 377 US 13 at 20-21 (1964). 104 Union Oil 377 US 13 at 22-23 (1964). Nettle overrule General Electric, it was not immediately apparent how the differences between the two decisions should be resolved105. The discrimen appeared to the Court in Murray Biscuit106 to be that in Union Oil, notwithstanding the legal position of the retail dealers as consignment agents, the "so-called retail dealer 'consignment' agreement" was a "clever manipulation of words"107, having no function other contradistinction to the position in General Electric, the oil company and the retail dealers were not "a unified economic consciousness incapable of conspiring with itself"108. the rule against price-fixing. to circumvent than Applying those observations to this case, counsel for Flight Centre submitted that, because the agency arrangement between Flight Centre and the airlines was not in any sense a contrivance devoid of purpose other than to circumvent the law against price-fixing, but was rather a longstanding method of airlines selling tickets to customers, the reasoning in General Electric showed that the airlines and Flight Centre were properly to be regarded as a unified economic consciousness that was incapable of agreeing with itself to maintain certain prices. That submission is not persuasive. To the extent that the reasoning in General Electric is capable of translation to the context of s 45A of the Trade Practices Act, it may be seen to support the relatively unremarkable proposition that, without more, the appointment by a manufacturer of an agent to sell its goods at prices determined by the manufacturer does not contravene the prohibition against price-fixing. In order to engage the operation of s 45A, the parties to a contract, arrangement or understanding to fix the price of goods or services which they supply must be in competition with each other for the supply of those goods or services. Of itself, the appointment by a manufacturer of an agent to sell its goods on its behalf does not mean that the manufacturer and the agent are in competition with each other for the sale of those goods to the public. But, equally, in the circumstances of a given case, it may be that the manufacturer and the agent are in competition with each other. So much indeed is confirmed by the decision of the United States Court of Appeals in American Airlines. 105 Murray Biscuit 797 F 2d 1430 at 1436-1437 (7th Cir 1986). 106 Murray Biscuit 797 F 2d 1430 at 1436-1437 (7th Cir 1986). 107 Union Oil 377 US 13 at 14, 22, 24 (1964). 108 Pink Supply Corp v Hiebert Inc 788 F 2d 1313 at 1317 (8th Cir 1986), quoted in Murray Biscuit 797 F 2d 1430 at 1436 (7th Cir 1986). Nettle In American Airlines, a travel agent sought a preliminary injunction to restrain what it alleged was unlawful price maintenance comprised of American Airlines' refusal to allow the travel agent to sell tickets on behalf of American Airlines below the prices set by the airline. The application for a preliminary injunction was refused on several bases, although principally because the relationship between American Airlines and travel agents was considered to be one of "genuine agency"109 attracting the operation of the rule in General Electric. It followed that the applicant was unable to establish the kind of per se contravention of the Sherman Anti-Trust Act that was necessary to ground preliminary relief. But, as the Court of Appeals remarked, that did not necessarily exclude the possibility that the applicant would be able at trial to establish that American Airlines' market power was such that its maintenance of higher prices was not productive of sufficient non-price benefits to make the price effects of the restraint "worth the price"110 from the perspective of consumers. Evidently, the idea that the maintenance of prices might not generate sufficient non-price benefits to make the price effects of the restraint "worth the price" imports a body of anti-trust jurisprudence and a range of considerations which differ from those that apply to s 45A of the Trade Practices Act. The Sherman Anti-Trust Act's conception of competition appears to be less "atomistic"111 than that which applies under the Trade Practices Act. Even so, American Airlines is relevant for present purposes in confirming that, despite the rule in General Electric, it is accepted that price-fixing arrangements between principal and agent are capable of having a substantially anti-competitive effect for the purpose of the Sherman Anti-Trust Act depending on the circumstances. Counsel for Flight Centre also placed reliance on a decision of the European Court of First Instance in DaimlerChrysler AG v Commission of the European Communities112 that the relationship between Mercedes-Benz and its sales agents in Germany was such that the sales agents should be regarded as in effect employees of Mercedes-Benz and therefore as forming a "single economic unit"113 with Mercedes-Benz. That was considered to be so notwithstanding that the sales agents were authorised to grant discounts out of their commission in such amounts as they should determine and were required to bear the costs of 109 American Airlines 806 F 2d 722 at 729 (7th Cir 1986) (emphasis in original). 110 American Airlines 806 F 2d 722 at 727 (7th Cir 1986). 111 American Airlines 806 F 2d 722 at 727 (7th Cir 1986). 112 [2005] ECR II-3319. 113 DaimlerChrysler [2005] ECR II-3319 at II-3358 [86], see also at II-3363 [102]. Nettle purchasing demonstration vehicles (which could prove difficult to re-sell at a profit), carry out all work under the Mercedes-Benz warranty and acquire and stock spare parts at their own economic risk114. It was held115 that the agreements between Mercedes-Benz and the sales agents, which included sales territory restraints, were not in breach of the applicable prohibition on anti-competitive conduct116. Flight Centre's reliance on the decision in DaimlerChrysler is misplaced. As has been seen, that case was concerned with whether exclusive territorial arrangements were anti-competitive, not with whether they amounted to price-fixing, and it was decided under legislation that is substantially different from ss 45 and 45A of the Trade Practices Act. Moreover, the reasoning does not assist in the circumstances of a case like this where, as a result of a longstanding practice of airlines selling tickets through travel agents at prices determined by the travel agents and the airlines subsequently adopting a practice of offering sales directly to customers as an alternative to sales through travel agents, there arises a degree of competition between airlines and travel agents with the result that travel agents attempt to maintain levels of sales by undercutting the prices offered by the airlines. Nothing said in the reasoning in DaimlerChrysler is opposed to the conclusion that, in the circumstances of this case, the making of an agreement or arrangement between an airline and a travel agent for the airline to raise its prices when selling directly to customers, so as to permit the travel agent to maintain its sales volume while increasing prices, would be anti-competitive. Counsel for Flight Centre next referred to the decision of this Court in Castlemaine Tooheys Ltd v Williams & Hodgson Transport Pty Ltd117, in which it was held that it was not exclusive dealing by means of third line forcing, contrary to s 47(6) of the Trade Practices Act, for Castlemaine Tooheys to sell beer on terms and at a price that included delivery to the purchaser's premises by a third party carrier acting as an agent118. Although not entirely clear, the point of counsel's submission seemed to be that, if Castlemaine Tooheys and the third party carrier were properly to be regarded as one entity for the purposes of 114 DaimlerChrysler [2005] ECR II-3319 at II-3331-II-3332 [13]-[16]. 115 DaimlerChrysler [2005] ECR II-3319 at II-3369 [122]. 116 Treaty Establishing the European Community, Art 81(1). 117 (1986) 162 CLR 395; [1986] HCA 72. 118 Castlemaine Tooheys (1986) 162 CLR 395 at 402 per Gibbs CJ (Dawson J agreeing at 406), 403 per Wilson J (Dawson J agreeing at 406), 405-406 per Brennan J (Deane J agreeing at 406). Nettle delivering beer to the purchaser, the airlines and Flight Centre should properly be regarded as one entity for the purposes of selling airline tickets to customers. If so, that submission should also be rejected. The difficulty with it is that, in Castlemaine Tooheys, it followed, from the fact that the arrangement for the carriage of the beer to the purchaser's premises was an arrangement between Castlemaine Tooheys and the carrier to which the purchaser was not party, that the carrier's services were supplied to Castlemaine Tooheys and not to the purchaser. That being so, it could not be said that Castlemaine Tooheys had required the purchaser to acquire carriage services from the carrier, either as a condition of purchasing the beer or at all, and, consequently, there was no exclusive dealing by means of third line forcing. By contrast here, Flight Centre was party to the sales of airline tickets which it made to customers, albeit as agent on behalf of the airlines, just as the airlines were party to the sales which they made directly. When Flight Centre prevailed on the airlines to increase the prices at which they sold airline tickets directly, it did so on its own behalf and not on behalf of the airlines. For that reason, its conduct can be seen as having the purpose or having, or being likely to have, the effect of substantially lessening competition in the market for the sale of international airline tickets. The decisions of the Federal Court in Paul Dainty Corporation Pty Ltd v The National Tennis Centre Trust119 and Australian Automotive Repairers' Association (Political Action Committee) Inc v Insurance Australia Ltd (formerly NRMA Insurance Ltd) (No 6)120, to which counsel also made reference, are distinguishable on the same basis. Counsel for Flight Centre sought in passing to distinguish a finding of Drummond J at first instance in Australian Competition and Consumer Commission v IMB Group Pty Ltd (in liq)121 that, where investors in an investment scheme were required as a term of the scheme to take out an insurance policy from the particular insurer nominated by IMB, that policy was supplied by the nominated insurer to the investors and acquired by the investors from the nominated insurer. That holding is consistent with the ACCC's contention in this case that, although Flight Centre sold airline tickets as agent for the airlines, Flight Centre supplied the airline tickets to the customer and the customer dealing with Flight Centre acquired the airline tickets from Flight Centre. Counsel for Flight Centre contended, however, that the finding was problematic and that, significantly, it was not expressly endorsed by the Full 119 (1990) 22 FCR 495. 120 [2004] FCA 700. 121 (2002) ATPR (Digest) ¶46-221; [2002] FCA 402. Nettle Court in that case122. In counsel's submission, the better view is that which was expressed by the Full Court in this case, that, where an agent has power and authority to sell for and on behalf of a principal, it is less likely that the agent can be considered to compete with the principal in relation to the supply of goods or services within the scope of the agency123. Generally speaking, it may be correct that, where an agent has authority to sell for and on behalf of the agent's principal, it is less likely than in other circumstances that the agent and the principal compete with each other for the sale of the goods or services in question. But so to observe in the present case really takes the matter no further. As Drummond J's holding in IMB Group helps to illustrate, the question of whether an agent, as opposed to an agent's principal, should be regarded as supplying the principal's goods or services depends as much as anything on the nature, history and state of relations between the principal and the agent so far as they relate to the supply of the goods or services. As has been seen, in a case like Castlemaine Tooheys, where the agent never had any dealings with the purchaser and thus the agent acted in fact and law solely on behalf of the principal, what was supplied to the purchaser was supplied by the principal, albeit through the agency of another. But where, as here, there had developed over time a practice of the agent having the principal's authority to supply customers with the principal's services at prices determined by the agent, the factual reality and legal substance of the matter was that it was the agent that supplied the services to the customer, albeit as the agent of the principal. Conclusion and orders In the result, it should be held that Flight Centre's conduct in attempting to persuade the airlines to increase the prices at which they sold airline tickets directly to customers was an attempt to enter into a contract, arrangement or understanding which had or was likely to have the effect of fixing, controlling or maintaining the price for airline tickets in the market for the sale of airline tickets in which both Flight Centre and the airlines competed. The conduct thus contravened s 45 of the Trade Practices Act. On that basis, I agree with the orders proposed by Kiefel and Gageler JJ. 122 Australian Competition and Consumer Commission v IMB Group Pty Ltd [2003] 123 Flight Centre (2015) 234 FCR 367 at 400 [163]. 149 GORDON J. Flight Centre sent emails, or a series of emails, to Singapore Airlines, Malaysia Airlines and Emirates proposing that each airline not sell its online airfares at prices lower than those determined by that airline and published to Flight Centre through a Global Distribution System ("the GDS"). Did Flight Centre engage in price fixing contrary to s 45(2)(a)(ii) of the Trade Practices Act 1974 (Cth) ("the TPA")? The answer is "yes". The analysis of the decisions below, the bases of the appeal to this Court and the limits of the functional approach in defining a market are set out in the reasons of Kiefel and Gageler JJ and I gratefully adopt them. The appeal should be allowed. I agree with the orders proposed by Kiefel and Gageler JJ. The primary judge's declarations of contravention of s 45(2)(a)(ii) of the TPA should stand adjusted in the manner proposed by Kiefel and Gageler JJ. However, I would reach the same conclusion – that Flight Centre engaged in price fixing contrary to s 45(2)(a)(ii) of the TPA – for different reasons. Flight Centre's principal contention was that, because it was the "agent" of each airline, it was not, and could not be, "in competition with" each airline for the purposes of s 45A(1) of the TPA. That contention fails at the first hurdle. At the point at which Flight Centre was dealing with its own customers in its own right without reference to any interests of any airline, the description of Flight Centre as "agent" is wrong factually. Flight Centre, in its own right, was competing against all sellers of tickets, which included the airlines and other travel agents. Flight Centre was not acting as agent. Further, the description of Flight Centre as "agent" is irrelevant for the purposes of the applicable provisions of the TPA. Section 45A is concerned with proscribing various practices in respect of pricing that are "restrictive". It is concerned with competition. Whether Flight Centre was, at some stage of the transaction, to be labelled or characterised as "agent" of the airlines was not the statutory question and does not resolve the appeal. These reasons will summarise the facts, address the applicable statutory provisions and, applying those provisions to the facts, conclude that Flight Centre contravened s 45(2)(a)(ii) of the TPA. Facts Flight Centre sells international airline tickets to customers. Flight Centre was a party to a Passenger Sales Agency Agreement ("the PSAA"), entered into between the International Air Transport Association ("the IATA"), on behalf of its airline members, and individual travel agents. Each of Singapore Airlines, Malaysia Airlines and Emirates was a member of the IATA and therefore each was party to the PSAA. Clause 3 of the PSAA authorised Flight Centre, as the "Agent", to sell international airline tickets, referred to as "air passenger transportation on the services" of an airline, on behalf of the airline, being an IATA member. That clause also defined the "sale of air passenger transportation" to mean "all activities necessary to provide a passenger with a valid contract of carriage including but not limited to the issuance of a valid Traffic Document and the collection of monies therefor". Flight Centre received an "at-source commission" for each sale. The commission was calculated as a percentage of the "published fare" for the relevant seat on the particular flight. The published fare was determined by the airlines and published to Flight Centre through the GDS. Flight Centre also entered into "preferred airline agreements" with certain airlines and, through those agreements, derived from those airlines additional incentive-based commissions and other payments, including payments to Flight Centre for promotional activities on behalf of those airlines. Flight Centre entered into preferred airline agreements with each of Singapore Airlines, Malaysia Airlines and Emirates. When Flight Centre made a sale on behalf of an airline, it held the customer's money on trust for the relevant airline until Flight Centre remitted the "nett amount" (the published fare less the at-source commission) to that airline and retained the balance as commission. The PSAA did not oblige Flight Centre to sell tickets on behalf of any particular airline, or to sell tickets at the published fare. Flight Centre could sell a ticket for less than the nett amount and make a loss in respect of that sale. Equally, the PSAA did not oblige the airlines to sell tickets exclusively through Flight Centre, or to sell any tickets sold directly to customers at the published fare. The airlines did not make all seats on their flights available through the GDS, and sold tickets directly to customers via the internet and telephone, often at prices less than the published fare. The ability of the airlines to sell directly to customers at prices less than the published fare was problematic for Flight Centre for two reasons. First, Flight Centre had its own "price beat guarantee", where it advertised that if a customer produced a quote from an airline or another agent for a ticket that was available and able to be booked, it would better that fare by $1 and give the potential customer a $20 voucher, while still being bound by the PSAA to remit the nett amount to the relevant airline. Second, if an airline sold a ticket directly to the customer at a price less than the published fare, Flight Centre would be unable to sell the customer a ticket with that airline and earn commission pursuant to the PSAA, making it less likely to meet sales targets and receive incentive-based commissions and other payments under the preferred airline agreements. Flight Centre's conduct Presumably in an attempt to resolve those problems, between August 2005 and May 2009, Flight Centre sent the following six emails or series of emails to the following airlines: (1) On 19 August 2005, Flight Centre sent an email to Singapore Airlines "formally express[ing] [Flight Centre's] opposition & concern" at Singapore Airlines' discounted online fares, which had caused Flight Centre to be "faced with being uncompetitive" and to incur "significant" losses. The email also asked Singapore Airlines why it "would go out of [its] way to undercut travel agents in general by such a large amount". (2) On 17 March 2006, Flight Centre sent a further email to Singapore Airlines saying that [its discounted online fares] eat into the available market" and "[t]he less margin, the less likely a consultant will want to sell [Singapore Airlines' tickets]". that "there must be acknowledgement (3) On 30 May 2008, Flight Centre sent an email to Emirates stating that "if a customer only wants a ticket" it would be "a difficult sell" for Flight Centre when Emirates is offering bonus points through its website, and that Emirates' discounted online fares "serve to undermine [Flight Centre's] ability to drive the [preferred airline agreement]". (4) On 31 December 2008, Flight Centre sent a further email to Emirates stating that in many instances, due to the discounted fares offered by Emirates when booking online, Flight Centre was only able to earn 3% on each ticket sold, rather than 7%. Flight Centre also expressed its concern that Emirates' additional online offers were "continuing to cause great difficulties for [Flight Centre] in retaining customers" and that Flight Centre consultants would likely "steer future clients away from [Emirates] ... for fear that they will lose the client direct". Flight Centre expressed a desire to work "proactively together to drive the [Emirates] product", but only in the event that, among others, the online discount related "issues" were addressed. Between February and March 2009, Flight Centre sent a series of emails to Malaysia Airlines stating that the discounted online fares were "clearly now hurting [Flight Centre's] brand" and assuring Malaysia Airlines that if it "change[d] [its] pricing policies ... 2009 could be a relatively good year for [it] in Australia", but that unless that happened "now, the damage that [would] be done to the [Malaysia Airlines] brand, certainly within Flight Centre, [would] take some time to repair". Flight Centre also stated that if Malaysia Airlines really wanted Flight Centre's help promoting its offers, then the discounting of online fares "MUST stop". In May 2009, Flight Centre sent a series of emails to Singapore Airlines to the effect that, if Singapore Airlines did not agree to a number of matters, including that it would not "undercut" Flight Centre in relation to online ticket sales, it would be best for Flight Centre and Singapore Airlines to "go [their] separate ways". Flight Centre sought agreement from Singapore Airlines that its online fares would be the same as those published through the GDS. Contravention of s 45(2)(a)(ii) of the TPA During the relevant period, s 45(2)(a)(ii) of the TPA provided that a corporation shall not make a contract or arrangement, or arrive at an understanding, if a provision of the proposed contract, arrangement or understanding has the purpose, or would have or be likely to have the effect, of substantially lessening competition. For the purposes of s 45, s 45A(1) deemed a provision of an actual or proposed contract, arrangement or understanding to have the purpose or to have or to be likely to have the effect prohibited by s 45 if: "the provision has the purpose, or has or is likely to have the effect, as the case may be, of fixing, controlling or maintaining, or providing for the fixing, controlling or maintaining of, the price for … goods or services supplied or acquired … by the parties to the contract, arrangement or understanding or the proposed contract, arrangement or understanding, or by any of them, or by any bodies corporate that are related to any of them, in competition with each other." (emphasis added) the proposed parties A key requirement of s 45A(1) was that the parties be "in competition with each other". Section 45(3) provided that "competition", for the purposes of ss 45 and 45A: "in relation to a provision of a contract, arrangement or understanding or of a proposed contract, arrangement or understanding, means competition in any market in which a corporation that is a party to the contract, arrangement or understanding or would be a party to the proposed contract, arrangement or understanding ... supplies or acquires, or is likely to supply or acquire, goods or services or would, but for the provision, supply or acquire, or be likely to supply or acquire, goods or services." (emphasis added) Market The effect of s 45(3) was that, for s 45A to operate, there must be a "market" in which there is "competition". And, relevantly, s 45(3) also required that in that "market", at least one of the parties to the contract, arrangement or understanding "supplies ... goods or services". "[M]arket" was defined in s 4E of the TPA to mean "a market in Australia and, when used in relation to any goods or services, includes a market for those goods or services and other goods or for, or otherwise competitive with, services the first-mentioned goods or services". substitutable that are Here, the relevant market in Australia is the market in which Flight Centre, every other travel agent and every IATA member airline compete to sell to a customer a "valid contract of carriage" on an airline – a ticket. A ticket is a contractual "right", enforceable by customers against an airline, "provided, granted or conferred in trade or commerce", and thus falls within the statutory definition of "services"124. If a travel agent or an airline sells a ticket, the others do not. Flight Centre and the airlines are supplying the same service – a ticket entitling the named holder to travel at a scheduled time on a scheduled date on an identified airline between identified places. The tickets supplied by the airlines and by Flight Centre were substitutable: in response to changing prices over a period of time, the tickets supplied by Flight Centre were substitutable for those supplied by the airlines when customers were given a sufficient price incentive125. That is not surprising. They were supplying the same service – a ticket entitling the named holder to travel at a scheduled time on a scheduled date on an identified airline between identified places. For the purposes of the TPA, Flight Centre, each other travel agent and each airline "supply" a service as they relevantly provide, grant or confer the ticket to a customer126. 124 s 4(1) of the TPA. 125 See Re Queensland Co-operative Milling Association Ltd – Proposed Merger (1976) 8 ALR 481 at 517 cited in Queensland Wire Industries Pty Ltd v Broken Hill Proprietary Co Ltd (1989) 167 CLR 177 at 188; [1989] HCA 6. 126 See par (b) of the definition of "supply" in s 4(1) of the TPA. The matter may be tested this way. For the purposes of the TPA, "supply" and "acquire" are words of wide import127 that are inter-related or symmetrical128. "Supply" is the counterpart of "acquire". In relation to services, "acquire" is defined as including "accept"129. Even without that inclusive statutory language, "acquire" in its ordinary and natural meaning would include the receipt or acceptance of a service130, here a ticket. From the perspective of the customer, who acquires the service by "accepting" the ticket, it is the fact that Flight Centre is to provide, grant or confer the ticket that is important, not whether it does so as the so-called "agent" for an airline. Competition Section 45A(1) required that the parties to the contract, arrangement or understanding be "in competition with each other". The area of competition and rivalry between Flight Centre and each airline was close. The emails showed Flight Centre's obvious concern that when an airline offered discounted prices for tickets, Flight Centre's customers would stop buying tickets from Flight Centre and instead buy tickets from the airline. The emails indicated that, in circumstances where an airline was selling discounted tickets, Flight Centre (a) saw itself as "faced with being uncompetitive"; (b) considered those tickets as "eat[ing] into the available market"; (c) regarded the airline as undercutting it and damaging its brand; and (d) experienced difficulties in retaining, and feared it would lose, its customers, who would move to buying a ticket directly from an airline. Flight Centre contended that there was and could be no competition between it and each of the airlines for the purposes of s 45A(1) of the TPA because of the terms of the PSAA. In short, it contended that a principal cannot be in competition with its "agent" because, under the law of agency, the "agent" supplies the good or service on behalf of the "principal". 127 See ss 4(1) and 4C of the TPA. cf The Commonwealth v Sterling Nicholas Duty Free Pty Ltd (1972) 126 CLR 297 at 309; [1972] HCA 19. 128 See Cook v Pasminco Ltd (2000) 99 FCR 548 at 552 [26]. 129 par (b) of the definition of "acquire" in s 4(1) of the TPA. 130 cf Castlemaine Tooheys Ltd v Williams & Hodgson Transport Pty Ltd (1985) 7 FCR 509 at 531 and on appeal in Castlemaine Tooheys Ltd v Williams & Hodgson Transport Pty Ltd (1986) 162 CLR 395 at 404-405; [1986] HCA 72. "Agent" is one of the most "commonly and constantly abused" words131. Flight Centre's focus on the fact that it is identified as the "Agent" in the PSAA is too narrow. That focus seeks to put two important facts out of consideration. First, in its dealings with customers, Flight Centre began by acting as principal – just like each airline and each other travel agent. It acted as principal in telling the customer that "I will get you a deal", "I will sell you a ticket at the best price". At that point, Flight Centre and each airline were in direct competition – to sell a ticket. Second, under the PSAA, Flight Centre is the agent for more than one airline, and it is the rivalry between Flight Centre and its many principals that creates one aspect of the market and the competition. The description of Flight Centre as "principal" or "agent" at various stages of the transaction of selling a ticket to a customer may be legally accurate, but it masks the proper identification of the rivalrous behaviours that occur at the point at which Flight Centre is dealing with its own customers in its own right without reference to any interests of any airline. At that point, the description of Flight Centre as "agent" is simply wrong. At that point, Flight Centre in its own right was competing against all sellers of tickets, which includes the airlines and other travel agents. Flight Centre was not acting as agent. For those reasons, Flight Centre was in competition with each airline for the purposes of s 45A(1) of the TPA. Purpose of the proposed contract, arrangement or understanding The words "contract", "arrangement" and "understanding" were not defined in the TPA. The case was rightly conducted on the basis that there was not, in fact, a contract, arrangement or understanding that contravened s 45(2)(a)(ii)132. None of the airlines could be said to have agreed to anything of that kind. Rather, the case against Flight Centre was that, by its conduct contained in the emails or series of emails sent to the airlines, it had "attempted to induce, a to contravene person, whether by threats or promises or otherwise", 131 See Colonial Mutual Life Assurance Society Ltd v Producers and Citizens Co-operative Assurance Co of Australia Ltd (1931) 46 CLR 41 at 50; [1931] HCA 53 quoting Kennedy v De Trafford [1897] AC 180 at 188. 132 See Australian Competition and Consumer Commission v Flight Centre Ltd (No 2) (2013) 307 ALR 209 at 211 [7], 249 [153]. s 45(2)(a)(ii)133. That is, Flight Centre had attempted to induce the airlines to enter into a contract, arrangement or understanding that had the purpose of substantially lessening competition. Whether the proposed contract, arrangement or understanding had the prohibited purpose of fixing, controlling or maintaining the price for a ticket is to be determined subjectively, having regard to the "end [the parties] had in view"134. Flight Centre's conduct shows that its end view was for the airlines to stop selling tickets online at prices less than those published to Flight Centre through the GDS. Although Flight Centre could sell the ticket at whatever price it chose, the airlines set the price of the ticket by publishing the fare through the GDS. The published fare was essentially a recommended retail price. The purpose of Flight Centre's proposed contract, arrangement or understanding was to fix the price of the airlines' online tickets so that they were at least the same as the recommended retail prices published through the GDS. As Heerey J said in Trade Practices Commission v Service Station Association Ltd135, "[o]f course if traders agree between themselves that each will follow published recommended prices, that may well amount to a fixing, controlling or maintaining of prices". That, in substance, was what Flight Centre was proposing, contrary to s 45(2)(a)(ii). Absent the proposed contract, arrangement or understanding, Flight Centre would have continued to compete with the airlines in the market for the sale of tickets to customers, with neither party constrained as to the prices at which they could offer to sell a ticket. Conversely, if the airlines were to implement Flight Centre's proposal, the airlines would no longer be free to fix and charge their own prices independently of Flight Centre, and there would be no or at least less competition or rivalry between Flight Centre and the airlines for the sale of tickets to customers. Accordingly, the future state of competition in the market for the sale of tickets would have been substantially lessened if Flight Centre's proposed contract, arrangement or understanding had been implemented. 133 s 76(1)(a)(i) and (1)(d) of the TPA; Australian Competition and Consumer Commission v Flight Centre Ltd (No 2) (2013) 307 ALR 209 at 211 [5]. 134 News Ltd v South Sydney District Rugby League Football Club Ltd (2003) 215 CLR 563 at 573 [18]; [2003] HCA 45. 135 (1992) 109 ALR 465 at 485 affirmed on appeal in Trade Practices Commission v Service Station Association Ltd (1993) 44 FCR 206 at 229. Provisions such as s 45A "manifest legislative concern with the injury to to keep up prices"136 (emphasis added). competition by practices apt The provision is concerned with proscribing various practices in respect of pricing that are "restrictive". It is concerned with competition. Flight Centre's proposal, if implemented, would have substantially lessened competition by keeping up prices. Whether Flight Centre was, at some stage of the transaction, properly to be characterised as an agent of the airlines is not the statutory question and does not resolve the appeal. Conclusion The two conditions in s 45A(1) were satisfied. The parties to the proposed contract, arrangement or understanding were "in competition with each other" in a market, and the proposed contract, arrangement or understanding was to fix, control or maintain the price of services in that market. The proposed contract, arrangement or understanding therefore had the purpose of substantially lessening competition and contravened s 45(2)(a)(ii). the purpose of Orders The appeal should be allowed. I agree with the orders proposed by Kiefel and Gageler JJ. The primary judge's declarations of contravention of s 45(2)(a)(ii) of the TPA should stand adjusted in the manner proposed by 136 Boral Besser Masonry Ltd v Australian Competition and Consumer Commission (2003) 215 CLR 374 at 428 [158]; [2003] HCA 5.

HIGH COURT OF AUSTRALIA CHANNEL SEVEN ADELAIDE PTY LTD APPELLANT AND RESPONDENT Channel Seven Adelaide Pty Ltd v Manock [2007] HCA 60 13 December 2007 ORDER Appeal dismissed. Special leave to cross-appeal be granted and the cross-appeal be treated as instituted, heard instanter and allowed. Set aside orders 2-5 of the Full Court of the Supreme Court of South Australia made on 18 October 2006 and, in their place, order that paragraphs 3.1-3.39, 8.1 and 8.2 of the further amended defence be struck out. The appellant pay the respondent's costs of the appeal and the cross- appeal. On appeal from the Supreme Court of South Australia Representation R J Whitington QC with S J Doyle for the appellant (instructed by Kelly & Co Lawyers) G O'L Reynolds SC with N J T Swan, R W Potter and A Williamson for the respondent (instructed by Lawson Smith Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Channel Seven Adelaide Pty Ltd v Manock Defamation – Defences – Fair comment – Promotion of a future edition of a television programme alleged to be defamatory – Defendant pleaded fair comment on a matter of public interest – Whether the allegedly defamatory statements constituted fact or comment – Distinction between fact and comment – Whether the facts on which the comments were alleged to be based were sufficiently identified – Construction of the rule from Pervan v North Queensland Newspaper Co Ltd (1993) 178 CLR 309 – Relevance of imputations conveyed by the promotion – Whether the alleged comments were fair – Whether reasonableness is a requirement of fairness. Defamation – Pleading and practice – Whether defence of fair comment should have been struck out – Whether defendant should be given an opportunity to re- plead defence of fair comment. Words and phrases – "comment", "fact", "fair", "imputation", "substratum of fact", "sufficiently indicated". GLEESON CJ. The facts and issues in the appeal are set out in the reasons of Gummow, Hayne and Heydon JJ ("the joint reasons"). I agree with the orders proposed in those reasons. What the joint reasons describe as issues (c), (d), and (e) come down to a question similar to that which Eady J formulated for decision in Lowe v Associated Newspapers Ltd1. There a newspaper had described a "manoeuvre" of the claimant as "a repellent piece of financial chicanery." The defamatory meaning alleged was that the claimant had obtained ownership of a football club "by underhand and dishonest means". Eady J said that the plea of fair comment was "to be scrutinised in order to see whether the particulars are such that a person could indeed honestly come to the conclusion, in the light of them, that the claimant had been dishonest."2 In the present case, the meaning alleged was based on an assertion in the published matter, which related to a murder trial, that there was evidence "they kept to themselves", with a background picture identifying the respondent with "them". The respondent had been an expert witness at the trial. The meaning alleged in the pleadings, and assumed for the purposes of the present argument to have been conveyed, was that the respondent had deliberately concealed evidence. It was in substance the same as what had been said in the publication. To this, the appellant raised a defence of fair comment. The particulars, unlike the published matter, set out the facts on which the "comment" was said to have been based. Those facts included allegations of inadequacy of the respondent's investigation into the death of the victim, inaccuracy and inconsistency in his evidence, failure to act promptly in certain respects, absence of sound scientific grounds for some of his reasoning, and errors of various kinds. Neither individually nor collectively did they raise matters such that a person could honestly have come to the conclusion, in the light of them, that the respondent had deliberately concealed evidence. I agree with what is said in the joint reasons about issues (c), (d), and (e). The issues described in the joint reasons as (a) and (b) are related, although distinct. The protection from actionability which the common law gives to fair and honest comment on matters of public interest is an important aspect of freedom of speech. In this context, "fair" does not mean objectively reasonable. The defence protects obstinate, or foolish, or offensive statements of opinion, or inference, or judgment, provided certain conditions are satisfied. The word "fair" refers to limits to what any honest person, however opinionated or prejudiced, would express upon the basis of the relevant facts. [2007] QB 580 at 585 [8]. In Pervan v North Queensland Newspaper Co Ltd3, McHugh J described as "the conventional case of fair comment" one where the basis of the comment appears in the publication and the reader (or viewer, or listener) is able to judge whether the facts justify the comments. He said that was very different from what he called "the Kemsley situation". It will be necessary to return to consider exactly what such a situation is, but, in one respect, this description of the conventional case may be unduly narrow. The defence is concerned with comment based on facts. The truth of those facts will affect the viability of the defence. The distinction between a comment (such as an expression of an opinion, or inference, or evaluation, or judgment) and the factual basis of the comment, blurred though it may be in many communications, affects the application of the defence in a number of ways. So long as a reader (or viewer, or listener) is able to identify a communication as a comment rather than a statement of fact, and is able sufficiently to identify the facts upon which the comment is based, then such a person is aware that all that he or she has read, viewed or heard is someone else's opinion (or inference, or evaluation, or judgment). The relationship between the two conditions mentioned in the previous sentence is that a statement is more likely to be recognisable as a statement of opinion if the facts on which it is based are identified or identifiable. However, to satisfy the requirements for the defence, it is not necessary that the facts upon which the comment is based be stated in the terms of the communication itself. The rationale is also satisfied if, to use the language of the majority in Pervan, the facts are "sufficiently indicated or notorious to enable persons to whom the defamatory matter is published to judge for themselves how far the opinion expressed in the comment is well founded"4. It is more accurate, therefore, to describe as conventional a case where the facts upon which the comment is based are stated in the terms of the communication, or are sufficiently indicated or notorious to enable persons to whom the defamatory matter is published to identify it as comment on those facts and to assess for themselves whether the facts support the comment. If the purported facts upon which the comment is based are not true, the defence does not lie. Hence, Bingham LJ's summation that "comment may only be defended as fair if it is comment on facts (meaning true facts) stated or sufficiently indicated."5 (We are not concerned, in this appeal, with questions that arise where there is a privilege that covers the statement of facts.) (1993) 178 CLR 309 at 341. (1993) 178 CLR 309 at 327. 5 Brent Walker Group Plc v Time Out Ltd [1991] 2 QB 33 at 44. There was argument in this case as to whether the majority in Pervan went too far in saying that the persons to whom the defamatory matter is published must be able to judge for themselves how far the opinion expressed in the comment is well founded. In Pryke v Advertiser Newspapers Ltd6, King CJ said: "A statement can be regarded as comment as distinct from allegation of fact only if the facts on which it is based are stated or indicated with sufficient clarity to make it clear that it is comment on those facts." That statement of principle was not in dispute. If the condition stated is satisfied, then in the ordinary case the person to whom the comment is published will be able to assess its foundation. What is "the Kemsley situation"? The author of the headnote to the report of the case7 summarised Lord Porter's opinion thus: "Newspapers, being submitted to the public, are a proper subject-matter of comment in the same way as literary works and the comment on them, in order to be fair, need not be confined to their literary content." That reflects what Lord Porter said at pages 355 and 356 of the report. What Lord Porter said, about matters submitted to the public, was substantially to the same effect as what had appeared in a leading text on the law of tort for some years before Kemsley v Foot and that, in turn, reflected the authorities referred to by the author of that text. The eighth edition of Salmond on the Law of Torts (for example), published in 1934, described the defence of fair comment in a way that went further than the customary descriptions. The author said8: "A fair comment on a matter which is of public interest or is submitted to public criticism is not actionable." The reason for the defence was said to be this9: "Comment or criticism is essentially a statement of opinion as to the estimate to be formed of a man's writings or actions. Being therefore a mere matter of opinion, and so incapable of definite proof, he who expresses it is not called upon by the law to justify it as being true, but is allowed to express it, even though others disagree with it, provided that it is fair and honest." (1984) 37 SASR 175 at 192. 7 Kemsley v Foot [1952] AC 345. 8 Salmond on the Law of Torts, 8th ed (1934) at 438. 9 Salmond on the Law of Torts, 8th ed (1934) at 439. As to matters submitted to public criticism, which he treated separately from matters of public interest (although obviously the two could overlap), the author said10: "He who voluntarily gives up his right of privacy by submitting himself or his deeds to public scrutiny and judgment must submit to the exercise of a right of public comment. This right, therefore, extends to books and every form of published literature, works of art publicly exhibited, and public musical or dramatic performances. So also with any form of appeal to the public, such as advertisements, circulars, or public speeches." In the Court of Appeal in Kemsley v Foot11, both Somervell LJ and Birkett LJ (with whom Jenkins LJ agreed) assimilated the conduct of the newspaper proprietor to that of an author, artist, or performer (or, nowadays, a professional sportsman), who submits a work or publication or performance to the public. Obviously, the readers of a commentary on a theatrical performance may not be able to see the performance and judge for themselves whether the commentary is well supported. Yet the defence of fair comment is open. Whether one treats this as a particular aspect of the public interest, or as a different subject of comment, is not presently important. The essence of "the Kemsley situation" is that certain forms of conduct are of such a nature as to invite comment. That is the genus of which books, and artistic works, and theatrical performances are species. Where conduct is "submitted to public criticism", then, so long as statements about that conduct are presented as comment and not as facts, it is not necessary that a reader, viewer or hearer of the comment should be in a position to form his or her own opinion. Conduct of that kind stands apart from "the conventional case". It was the conventional case to which Lord Nicholls of Birkenhead was referring in Reynolds v Times Newspapers Ltd12 and Cheng v Tse Wai Chun13, and to which the majority in this Court was referring in Pervan14. In the present case, the condition stated by King CJ in Pryke was not satisfied. To be protected by the defence of fair comment, the defamatory matter had to be recognisable as comment and not as a statement of fact. The facts on 10 Salmond on the Law of Torts, 8th ed (1934) at 441 (reference omitted). 11 [1951] 2 KB 34 at 42, 50-51. 12 [2001] 2 AC 127 at 201. 13 (2000) 3 HKCFAR 339 at 347-348. 14 (1993) 178 CLR 309 at 327. which the matter was based were neither stated nor indicated with sufficient clarity to make it clear that it was comment on those facts. It is important to bear in mind the nature of the published matter. It was a short, promotional item. Some people who saw it would also watch the later programme which was being promoted. Many would not. The reasons why they would not might be various. For some, it may have been inconvenient. For some, it may have been impossible. Others might simply have had better things to do. There are, no doubt, circumstances where the connection in time, place, or form between that which is being promoted and the promotional material is such that the two can be linked for the purpose of identifying a sufficient indication of facts by the promotional material. The indication, however, must be to the ordinary reader, or viewer, or hearer of the promotional material. The matter published was very brief and was calculated to have a strong impact. It would be naive to think that the broadcaster was conveying to the viewers that what it was saying was only the broadcaster's opinion, and that other opinions might be open. It is artificial to separate the four sentences used by the broadcaster. So far as the respondent's reputation was concerned, the sting was in the use of his image, and the words: "The evidence they kept to themselves." The first sentence, announcing "new Keogh facts", plainly represented to viewers that new facts had emerged that were to be revealed in the programme being promoted. The promise to reveal facts that were not previously known to the general public was at the forefront of the promotional exercise. That promise was followed immediately by a reference to the evidence that "they" (the respondent) "kept to themselves". That would not appear to an ordinary reasonable viewer as an opinion as distinct from a statement of fact. The first, third and fourth sentences gave context and colour to the second sentence, but the substance of what was published was that the broadcaster was in a position to reveal new facts about the Keogh trial, and that the forensic pathologist had kept material evidence to himself. That was clearly capable of conveying the meaning that he deliberately concealed evidence, and it was presented in the form of fact, not comment. No doubt, from a marketing point of view, there was a good reason for that. That may be why, as counsel observed, brief advertisements are sometimes unpromising material for a defence of fair comment. The impact they are designed to achieve may be difficult to reconcile with a requirement that an allegation must be recognisable as comment and not as a statement of fact. In this respect, television promotions are not in some special category. Nor, for that matter, are promotions generally. Publishers and broadcasters may have their own commercial imperatives. The form in which those imperatives manifest themselves changes from time to time with changes in technology. The matter of present importance is that the law of defamation distinguishes between comment and statements of fact, even if publishers and broadcasters do not. The rationale for that was explained by Bingham LJ in Brent Walker Group Plc v Time Out Ltd15. The defence on which the appellant seeks to rely applies to allegations that are recognisable as comment rather than as statements of fact. The allegation against the respondent was not of that kind. 15 [1991] 2 QB 33 at 44. GUMMOW, HAYNE AND HEYDON JJ. This appeal raises a range of issues concerning the common law defence to a defamation action of fair comment on a matter of public interest. The defence was pleaded to an action commenced in the District Court of South Australia in 2004 but which is yet to go to trial. The case comes to this Court from an appeal heard by the Full Court of the Supreme Court against the outcome of a strike-out application. The factual background In March 1994, Anna-Jane Cheney was found dead in her bath. Her fiancé, Henry Keogh, was charged with her murder. The jury failed to agree at his first trial, but on 23 August 1995 he was convicted at a second trial and sentenced to life imprisonment, with a 25 year non-parole period. He has brought an appeal to the South Australian Court of Criminal Appeal, an application for special leave to appeal to this Court, and two petitions to the Governor of South Australia for mercy, all without success. Dr Colin Manock ("the plaintiff") is a forensic pathologist. He was formerly the Senior Director of Forensic Pathology at the State Forensic Science Centre. He conducted a forensic examination into Anna-Jane Cheney's death, and gave evidence for the prosecution at the criminal trials. On 5 March 2004 at approximately 7.00pm Channel Seven Adelaide Pty Ltd ("the defendant") broadcast what the parties have called a "promotion" on television as part of a programme known as Today Tonight. The item was promoting a future edition of Today Tonight. The presenter said: "The new Keogh facts. The evidence they kept to themselves. The data, dates and documents that don't add up. The evidence changed from one Court to the next." While these words were being said, a picture of the plaintiff was displayed in the background, slightly above the presenter. The presenter then said, according to the further amended defence: "They're so smug and complacent about how fantastic our court system is, that we need an urgent wakeup call." And: "Unless the investigation is thorough then the court proceedings aren't going to be complete because they're only getting part of the story." The issues in outline In Pervan v North Queensland Newspaper Co Ltd16 this Court gave some consideration to the common law defence of fair comment. No application to reopen Pervan's case was made by either party to the present appeal, but they disagree as to the meaning and significance of what was said in Pervan's case. The "promotion" broadcast by the defendant was designed to catch the attention of viewers and to retain their interest in watching the future programme. What was held out to viewers was the revelation of "new" facts. These would not be facts already known. Hence a submission by the defendant the effect of which would be to change the defence from one of fair comment on facts accurately and truly stated to one of fair comment on indicated topics of public interest. For the reasons which follow this submission should be rejected. The issues on the appeal also concern the distinction between fact and comment; the consequences of the intermingling of fact and comment; the sufficiency of identification of the factual basis for the comment; and the requirement that the defence address the meaning of the defamatory matter pleaded by the plaintiff. The procedural background The pleadings. On 22 March 2004 the plaintiff instituted proceedings in defamation against the defendant. The statement of claim alleged that the promotion "in its ordinary and natural meaning meant and was understood to mean that the plaintiff had deliberately concealed evidence from the trials of Mr Keogh when he was tried for murder". Obviously if that meaning is found, the promotion made a very grave allegation of misconduct by the plaintiff – a serious crime17, a most serious breach of duty on the part of a professional assisting the authorities in a murder prosecution, and a wicked act which could have caused a grave injustice to the accused. 16 (1993) 178 CLR 309. 17 The Criminal Law Consolidation Act 1935 (SA), s 243, provides that it is an offence to conceal anything that may be required in evidence at judicial proceedings with the intention of influencing the outcome of judicial proceedings. Section 242(1) creates the offence of making a false statement under oath. For each offence the penalty is imprisonment for 7 years. On 16 June 2004 the defendant filed a brief defence denying all allegations. On 2 March 2005 that defence was replaced by an amended defence denying that the promotion bore the meaning alleged by the plaintiff, denying that it referred solely or primarily to the plaintiff, and pleading numerous positive defences including fair comment on a matter of public interest, justification, absence of reputation and qualified privilege. On 12 July 2005 a further amended defence was filed. The defendant's plea of fair comment took the following form: "Further, or in the alternative, the defendant says that the following words: the new Keogh facts; the evidence they kept to themselves; the data, dates and documents that don't add up; and the evidence changed from one Court to the next, constitute fair comment on a matter of public interest." There followed 10 pages of particulars18. The first of those pages, under the heading "Particulars of Public Interest", pars 3.5-3.17, made various allegations on that subject. The last nine of those pages, under the heading "Particulars of facts upon which comment is based", in pars 3.18-3.39, alleged that the plaintiff had conducted an inadequate investigation and given inaccurate evidence19. 18 They are set out in Manock v Channel Seven Adelaide Pty Ltd (2006) 95 SASR 462 19 The District Court Rules 1992 (SA) (Civil), r 46A.02(b), provided: "All pleadings are to: (b) plead only the material facts relied upon and not the evidence or arguments by which they are to be proved". Rule 46A.05(2)(b) and (c) provided: "The Defence must plead, but plead only: (Footnote continues on next page) The defendant's plea of justification appeared in pars 4 and 5 of the further amended defence. They alleged that the promotion meant that the plaintiff's evidence at the criminal trials was "unsatisfactory to the knowledge of the plaintiff" and that, on that meaning, the promotion was true; the particulars of justification offered were pars 3.18-3.39. Paragraphs 6 and 7 alleged that the plaintiff's reputation as a forensic pathologist had been so impaired by various events before the promotion was broadcast that it was incapable of damaging his reputation. Paragraph 8 alleged that: "[T]he promotion was published on an occasion of qualified privilege in that the broadcast constituted the discussion of government and political matters and the defendant's conduct in publishing the promotion was reasonable in the circumstances." (b) the material facts relied upon to constitute any ground of defence on which the defendant bears an evidentiary or a legal onus of proof; (c) such further material facts as are necessary to give other parties fair notice of the defendant's case which they will have to meet". Rule 46A.09(1) and (2) provided: "(1) No order is to be made that any further material facts are to be pleaded other than where the material facts pleaded do not disclose facts sufficient to give the other parties fair notice of the case which they will have to meet and the party seeking them would be significantly prejudiced in the conduct of its case by not having them. (The intent of Rule 46A is that parties should include all material facts in their pleadings as initially filed so that there is no unfairness to another party by any lack of particularity and if they have not done so the trial Judge may refuse to allow that party to present a case which is outside the terms of its pleading.) (2) No pleading is embarrassing for want of particularity unless the missing particulars would be ordered under (1)." Paragraph 3 of the further amended defence is structured on the theory that pars 3.1-3.4 are material facts which are not particulars, and pars 3.5-3.39, inter alia, are material facts which are, in the language of r 46A.09(1) and (2), designed to give "particularity" under r 46A.05(2)(c) to the material facts in pars 3.1-3.4 pleaded pursuant to r 46A.05(2)(b) by giving the plaintiff fair notice of the case he has to meet. Under the heading "Particulars of the Discussion of Government and Political Matters" there appeared, among other allegations, the following two paragraphs: "8.1 The defendant repeats paragraphs 3.5-3.39 inclusive of this Amended Defence; The defendant repeats paragraphs 6.1-6.3 Amended Defence". inclusive of this The District Court proceedings at first instance. On 27 September 2005 the District Court of South Australia (Master Rice) struck out pars 3.17-3.18, 3.26-3.28 and 3.33-3.34 of the further amended defence. The Master also struck out the justification defence in pars 4 and 5 on the ground, inter alia, that proof that the plaintiff knew the evidence called to be unsatisfactory did not establish the truth of the imputation pleaded by the plaintiff. And the Master struck out the impaired reputation defence in par 620. The District Court appeal. The plaintiff appealed to a judge of the District Court (Judge Muecke) against the Master's failure to strike out pars 3.13-3.16, 3.19-3.25 and 3.29-3.39. The defendant cross-appealed against the Master's order striking out pars 3.17-3.18, 3.26-3.28 and 3.33-3.34. The defendant did not cross-appeal against the Master's order striking out pars 4-6. Judge Muecke noted that the plaintiff had not sought before the Master, and did not seek before him, to strike out pars 3.1-3.4 – the paragraphs alleging as material facts that the words of the promotion constituted fair comment on a matter of public interest. He therefore approached the controversy on the basis that the words in the promotion which the defendant alleged were fair comment were capable of being construed as a comment21. Judge Muecke held that pars 3.13-3.17, 3.18 (in part), 3.26.1, 3.26.3 and 3.35.11.3.2 be struck out22. 20 Manock v Channel Seven Adelaide Pty Ltd unreported, District Court of South Australia, 27 September 2005. The Master's order does not refer to par 7, but his reasons for judgment, at [48]-[52], suggest that he intended to strike it out. 21 Manock v Channel Seven Adelaide Pty Ltd [2005] SADC 168 at [16]-[17]. 22 The last two paragraphs were struck out on the basis that certain affidavit evidence was given to the Medical Board Tribunal after 5 March 2004, which it was: Manock v Channel Seven Adelaide Pty Ltd [2005] SADC 168 at [33]-[40]. It was conceded on the appeal that the particulars to pars 3.26.1, 3.26.2 and 3.26.3 had to be abandoned for the same reason, and it follows that those paragraphs must be treated as abandoned. The Supreme Court appeal. The plaintiff then appealed to a single judge of the Supreme Court of South Australia (Bleby J), who referred the appeal to the Full Court. The appeal was against "that portion of the judgment which did not strike out ... the balance of paragraph 3.18 to 3.39". The plaintiff thus continued not to object to pars 3.1-3.4. The plaintiff's position was that even if pars 3.18- 3.39 were struck out, the defendant "ought to be given one final opportunity to plead particulars to support its defence of fair comment ... [and] in the event that Channel Seven was unable to do so, para 3 should be struck out"23. The Full Court (Gray, White and Layton JJ) allowed the appeal and ordered that pars 3.18-3.39 be struck out. It gave leave to the defendant to amend the further amended defence within 28 days. The ground of the Full Court's decision, shortly put, is that "the substance of the comment cannot have a substantially different ... meaning than the imputation alleged by the plaintiff" and that a defence of fair comment must address the imputation pleaded by the plaintiff24. This, the Full Court held, pars 3.18-3.39 failed to do. The appeal to this Court The notice of appeal. By special leave, the defendant appealed to this Court. It seeks orders having the effect of reinstating pars 3.18-3.39. The notice of appeal took issue with the central part of the Full Court's reasoning. The defendant maintained its position of not challenging the Master's striking out of pars 4-6. The notice of contention. The plaintiff filed a notice of contention. The contention in question was that pars 3.18-3.39 should have been struck out on 15 grounds which could be described as conventional pleading objections. The notice of cross-appeal. The plaintiff also sought special leave to cross-appeal. The notice of cross-appeal sought an order that not only pars 3.18- 3.39 of the particulars be struck out (as the Full Court had), but that pars 3.1-3.17 be struck out as well. The attack on pars 3.1-3.17, and in particular on pars 3.1- 3.4, had not been made before the Master, Judge Muecke or the Full Court. Of the 18 grounds of cross-appeal, the first 15 repeated the grounds in the notice of contention. The last three of the 18 grounds, appearing as par 2(p)-(r), were: 23 Manock v Channel Seven Adelaide Pty Ltd (2006) 95 SASR 462 at 472 [21]. 24 Manock v Channel Seven Adelaide Pty Ltd (2006) 95 SASR 462 at 479-480 [40] and [43]. "(p) paragraphs 3.1-3.4 constitute statements of fact not opinion; paragraphs 3.1-3.4 cannot constitute comments on the facts pleaded at paragraphs 3.5-3.39; alternatively, paragraphs 3.1-3.4 constitute comments inextricably intermingled in the publication with factual matter." The issues. It is convenient to deal with the issues in the following order, which is different from the order in which they are presented by the notices of appeal, cross-appeal and contention. (a) Do pars 3.1-3.4 of the further amended defence plead comment? (b) Are the facts on which the supposed comment is alleged to be based sufficiently identified? Is the meaning pleaded by the plaintiff relevant to the defence of fair comment pleaded by the defendant? Even if the answer to (c) is "Yes", would the number and nature of the criticisms made in pars 3.19-3.39 lead an honest person to agree that the plaintiff had deliberately concealed evidence? (e) Did the Full Court address the wrong question by asking whether the defendant's particulars of fact were capable of proving the truth of the meaning pleaded by the plaintiff? Should the defendant's defence of fair comment have been struck out in any event by reason of pleading deficiencies? For the reasons stated below, the answers given to questions (a)-(e) are (a) No25; (b) No26; (c) Yes27; (d) No28; and (e) No29. Question (f) need not be answered. The answer to each of the first four questions constitutes an 25 See [33]-[44]. 26 See [45]-[75]. 27 See [76]-[78]. 28 See [88]-[92]. 29 See [93]-[94]. independent reason for the conclusion that the appeal must be dismissed and the cross-appeal allowed. Do the allegations in pars 3.1-3.4 plead comment? Relevant approach. In Favell v Queensland Newspapers Pty Ltd30 this Court approved the following statement of McPherson JA as a correct approach where application is made to strike out defamation pleadings as disclosing no cause of action: "Whether or not [the pleading] ought to and will be struck out [as disclosing no cause of action] is ultimately a matter for the discretion of the judge who hears the application. Such a step is not to be undertaken lightly but only, it has been said, with great caution. In the end, however, it depends on the degree of assurance with which the requisite conclusion is or can be arrived at. The fact that reasonable minds may possibly differ about whether or not the material is capable of a defamatory meaning is a strong, perhaps an insuperable, reason for not exercising the discretion to strike out. But once the conclusion is firmly reached, there is no justification for delaying or avoiding that step [at] whatever stage it falls to be taken." The same applies to the striking out of defences. Thus the fact, for example, that reasonable minds might possibly differ about whether the pleaded material is fact or comment is a strong reason for not striking out the allegations, but once the conclusion is firmly reached that it is fact, there is no justification for not giving effect to that conclusion. Significance of issue. If pars 3.1-3.4 do not plead comment at all, but only facts, the plaintiff's cross-appeal must succeed. That is because, as facts, they might be material to a defence of justification, but that defence was struck out by the Master, without later complaint by the defendant. As facts, they might also be material to a defence of qualified privilege. But, as facts, they cannot constitute fair comment on a matter of public interest, and should be struck out together with the particulars pleaded in pars 3.5-3.39. If some, but not all, of pars 3.1-3.4 plead comment, those that do not cannot constitute fair comment on a matter of public interest, and pars 3.5-3.39 would have to be scrutinised to see whether they were capable of supporting the allegations which did plead comment. 30 (2005) 79 ALJR 1716 at 1719 [6] per Gleeson CJ, McHugh, Gummow and Heydon JJ; 221 ALR 186 at 189. Distinguishing fact and comment. In Brent Walker Group Plc v Time Out Ltd Bingham LJ said31: "The law is not primarily concerned to provide redress for those who are the subject of disparaging expressions of opinion, and freedom of opinion is (subject to necessary restrictions) a basic democratic right. It is, however, plain that certain statements which might on their face appear to be expressions of opinion (as where, for example, a person is described as untrustworthy, unprincipled, lascivious or cruel) contain within themselves defamatory suggestions of a factual nature. Thus the law has developed the rule ... that comment may only be defended as fair if it is comment on facts (meaning true facts) stated or sufficiently indicated." (emphasis added) In Goldsbrough v John Fairfax & Sons Ltd32 Jordan CJ said that for the defence of fair comment to succeed, "it is essential that the whole of the words in respect of which it is relied on should be comment". He continued33: "It must be indicated with reasonable clearness by the words themselves, taking them in the context and the circumstances in which they were published, that they purport to be comment and not statements of fact; because statements of fact, however fair, are not protected by this defence. In other words, it must appear that they are opinions stated by the writer or speaker about facts, which are at the same time presented to, or are in fact present to, the minds of the readers or listeners, as things distinct from the opinions, so that it can be seen whether the opinions are such that they can fairly be formed upon the facts." (emphasis added) A "discussion or comment" is to be distinguished from "the statement of a fact"34. "It is not the mere form of words used that determines whether it is comment or not; a most explicit allegation of fact may be treated as comment if it would be understood by the readers or hearers, not as an independent imputation, but as an 31 [1991] 2 QB 33 at 44. 32 (1934) 34 SR (NSW) 524 at 531-532. 33 He cited Myerson v Smith's Weekly Publishing Co Ltd (1923) 24 SR (NSW) 20 at 26-27; Cole v The Operative Plasterers Federation of Australia (NSW Branch) (1927) 28 SR (NSW) 62 at 67-68. 34 Popham v Pickburn (1862) 7 H & N 891 at 898 [158 ER 730 at 733] per Wilde B. inference from other facts stated."35 As the passages quoted from Bingham LJ and Jordan CJ above illustrate, the distinction between fact and comment is commonly expressed as equivalent to that between fact and opinion36. Cussen J described the primary meaning of "comment" as "something which is or can reasonably be inferred to be a deduction, inference, conclusion, criticism, judgment, remark, observation, etc"37. It follows that a comment can be made by stating a value judgment, and can also be made by stating a fact if it is a deduction from other facts. Thus, in the words of Field J38: "[C]omment may sometimes consist in the statement of a fact, and may be held to be comment if the fact so stated appears to be a deduction or conclusion come to by the speaker from other facts stated or referred to by him, or in the common knowledge of the person speaking and those to whom the words are addressed and from which his conclusion may be reasonably inferred. If a statement in words of a fact stands by itself naked, without reference, either expressed or understood, to other antecedent or surrounding circumstances notorious to the speaker and to those to whom the words are addressed, there would be little, if any, room for the inference that it was understood otherwise than as a bare statement of fact". (emphasis added) The question of construction or characterisation turns on whether the ordinary reasonable39 "recipient of a communication would understand that a statement of fact was being made, or that an opinion was being offered"40 – not 35 Cole v The Operative Plasterers Federation of Australia (NSW Branch) (1927) 28 SR (NSW) 62 at 67 per Ferguson J (Street CJ and Gordon J concurring). 36 For example, Mackay v Bacon (1910) 11 CLR 530 at 535-536 per Griffith CJ; Smith's Newspapers Ltd v Becker (1932) 47 CLR 279 at 302 per Evatt J; O'Shaughnessy v Mirror Newspapers Ltd (1970) 125 CLR 166 at 173 per Barwick CJ, McTiernan, Menzies and Owen JJ; Petritsis v Hellenic Herald Pty Ltd [1978] 2 NSWLR 174 at 196 per Mahoney JA. 37 Clarke v Norton [1910] VLR 494 at 499. 38 O'Brien v Marquis of Salisbury (1889) 6 TLR 133 at 137. 39 Crawford v Albu 1917 AD 102 at 105 per Bristowe J, approved at 125 by Solomon JA. See also Rocca v Manhire (1992) 57 SASR 224 at 235; Kerr v Conlogue (1992) 65 BCLR (2d) 70 at 84. 40 Petritsis v Hellenic Herald Pty Ltd [1978] 2 NSWLR 174 at 182 per Reynolds JA. "an exceptionally subtle" recipient41, or one bringing to the task of "interpretation a subtlety and perspicacity well beyond that reasonably to be expected of the ordinary reader whom the defendant was obviously aiming at"42. The present circumstances create two particular difficulties for the defendant in resisting the conclusion that the material was fact, not comment. First, it is harder for a viewer of television to distinguish fact and comment than it is for a person reading printed material, as Blackburn CJ noted43: "It is obvious that a television viewer receives a succession of spoken words and visual images, which he is unable to have repeated for the purpose of reflection or clarification; whereas a reader of printed material normally has it all before him at will, and has unlimited facilities for re- reading. In my opinion it is important in the case before me, when considering whether there is material which can be perceived to be comment, as distinct from fact, but based upon stated fact, to remember that the viewer sees and hears the material simultaneously, and only once." (emphasis added) Secondly, the "ordinary" recipient at whom the defendant here was aiming is to be identified remembering that the defendant was using a commercial television channel to broadcast in prime time a brief promotion of a television programme to be viewed at prime time. "The new Keogh facts". This statement is a statement that new facts had emerged in the Keogh case. Whether or not new facts had emerged in the Keogh case is a question of fact, not opinion: either they had or they had not. And the proposition that new facts had emerged is not put as a deduction or conclusion from other facts: for the statement that there were new facts in the Keogh case is a statement that there were facts which the public did not already know and which would be described to them for the first time if they watched the programme being promoted by the promotion. Like the second and third statements, this statement is not said to be a matter of "opinion", "comment", "conclusion", "deduction" or "observation" from which a reader might infer that it was a matter of comment, not fact. 41 Smith's Newspapers Ltd v Becker (1932) 47 CLR 279 at 302 per Evatt J. 42 London Artists Ltd v Littler [1969] 2 QB 375 at 398 per Edmund Davies LJ. 43 Comalco Ltd v Australian Broadcasting Corporation (1985) 64 ACTR 1 at 40. "The evidence they kept to themselves". Although it is not clear to whom the word "they" referred, the simultaneous showing of the plaintiff's picture suggests that it must have referred to a class which included the plaintiff. To say that the plaintiff kept evidence to himself is to say that he deliberately concealed it. Whether he did is a question of fact. Fletcher Moulton LJ said that in an imputation that certain plaintiffs had "dishonestly" and "corruptly" supplied a newspaper with information, the words "dishonestly" and "corruptly" were44: "not comment, but constitute allegations of fact. It would have startled a pleader of the old school if he had been told that, in alleging that the defendant 'fraudulently represented', he was indulging in comment. By the use of the word 'fraudulently' he was probably making the most important allegation of fact in the whole case." Similarly, to allege that the plaintiff did not give certain evidence because he deliberately concealed it is to state a fact. And in Davis v Shepstone45 Lord Herschell LC said: "[T]he distinction cannot be too clearly borne in mind between comment or criticism and allegations of fact, such as that disgraceful acts have been committed, or discreditable language used. It is one thing to comment upon or criticise, even with severity, the acknowledged or proved acts of a public man, and quite another to assert that he has been guilty of particular acts of misconduct." To say of an expert witness called by the prosecution in a murder trial that he concealed evidence in the circumstances pleaded is not to criticise his acknowledged or proved acts; it is to assert that he has been guilty of a particular act of misconduct. And the "evidence they kept to themselves" is in the same category as "the new Keogh facts" – that is, the statement is not a deduction from other facts, but a reference to evidence which the public did not already know and which would be described to them if they watched the programme being promoted. "The evidence changed from one Court to the next". This too is a statement of fact. Its merits are tested by comparing what testimony was given or what documents were tendered in one case with the testimony and documents in another. The statement, preceded as it is by reference to the "new Keogh facts", suggests that the changes in question would be described in the 44 Hunt v Star Newspaper Co Ltd [1908] 2 KB 309 at 320. 45 (1886) 11 App Cas 187 at 190. programme when viewed, would come as a revelation to viewers, and would be inferred from other already known facts. "The data, dates and documents that don't add up". Unlike the other three allegations, this may be more than a statement of fact. Attempting to "add up" the "data, dates and documents" suggests a process of evaluation and judgment. However, in par 2(r) of the notice of cross-appeal the plaintiff contended that "paragraphs 3.1-3.4 constitute comments inextricably intermingled in the publication with factual matter". The plaintiff is here relying on Fletcher Moulton LJ's injunction in Hunt v Star Newspaper Co Ltd46: "[C]omment in order to be justifiable as fair comment must appear as comment and must not be so mixed up with the facts that the reader cannot distinguish between what is report and what is comment ... The justice of this rule is obvious. If the facts are stated separately and the comment appears as an inference drawn from those facts, any injustice that it might do will be to some extent negatived by the reader seeing the grounds upon which the unfavourable inference is based. But if fact and comment be intermingled so that it is not reasonably clear what portion 46 [1908] 2 KB 309 at 319-320. The second to fourth sentences quoted were approved soon after, in 1911, in the "Libel and Slander" title of Halsbury's Laws of England, 1st ed, vol 18, par 1285, n (e); the authors were Sir Rowland Vaughan Williams and A Romer Macklin. The passage was also given speedy approval by Veeder, "Freedom of Public Discussion", (1910) 23 Harvard Law Review 413 at 419-420. The passage was later approved in Myerson v Smith's Weekly Publishing Co Ltd (1923) 24 SR (NSW) 20 at 27 per Ferguson J (Cullen CJ and Gordon J concurring); Thompson v Truth and Sportsman Ltd (No 4) (1930) 31 SR (NSW) 292 at 299 per Ferguson J; Thompson v Truth and Sportsman Ltd (No 4) (1932) 34 SR (NSW) 21 at 24-25 per Lords Tomlin, Thankerton and Macmillan and Sir Lancelot Sanderson; Gardiner v John Fairfax & Sons Pty Ltd (1942) 42 SR (NSW) 171 at 178 per Davidson J; and London Artists Ltd v Littler [1969] 2 QB 375 at 395 per Edmund Davies LJ. It was accepted as correct by Lord Porter in Kemsley v Foot [1952] AC 345 at 359-360, with the qualification that Fletcher Moulton LJ "had not to consider whether the facts must be set out in full or whether a reference to well known or easily ascertainable facts was a sufficient statement of those relied on", and hence was saying nothing about that issue. The passage is quoted and accepted as correct in Gatley on Libel and Slander, 10th ed (2004), par 12.11. See also Goldsbrough v John Fairfax & Sons Ltd (1934) 34 SR (NSW) 524 at 531- 532 per Jordan CJ ("facts ... as things distinct from the opinions"); Orr v Isles (1965) 83 WN (Pt 1) (NSW) 303 at 312 per Walsh J ("if severable") and 329 per Taylor J ("must not be ... mixed up with the facts"). purports to be inference, he will naturally suppose that the injurious statements are based on adequate grounds known to the writer though not necessarily set out by him. In the one case the insufficiency of the facts to support the inference will lead fair-minded men to reject the inference. In the other case it merely points to the existence of extrinsic facts which the writer considers to warrant the language he uses ... Any matter, therefore, which does not indicate with a reasonable clearness that it purports to be comment, and not statement of fact, cannot be protected by the plea of fair comment." And in Smith's Newspapers Ltd v Becker, Evatt J, speaking of a newspaper article containing a heading "German Quack runs riot on the Murray Flats", said47: "[S]o fortunate an avenue of escape via fair comment will seldom, if ever, be open to a newspaper which uses defamatory headlines or headings, without making it quite clear that a mere expression of opinion is being announced to the world, upon the basis of the facts to be stated in a subjoined article. Streamer headlines, the intermingling of facts with actual or possible expressions of opinion and screaming posters are features of this age of industrialism, and praise or blame is no concern of ours. But the legal defence of fair comment will very rarely protect defamatory matter contained in such journalism, not because the motives of the proprietors are mercenary (resembling those of all other industries), but because of the impossibility of achieving sensations, and still effecting a clear separation of the facts from the defamatory expressions of opinion." The process of characterising the statement is not made easier by its obscurity. It is not clear whether it is said that there are inconsistencies between the data, dates and documents (and if so whether they are already known to viewers, or whether they are in the category of the "new Keogh facts"), or whether, although the data, dates and documents are consistent, they are incapable of proving Mr Keogh's guilt, or whether there is a mixture of these contentions. This obscurity strongly suggests that while there may be a comment – an opinion, an evaluation, a judgment, an ultimate inference – being asserted, it is impermissibly mixed up and intermingled with factual material. The four sentences taken together. To this point the four sentences making up the promotion have been analysed separately, but the same conclusion would follow if they are taken together. The defendant submitted that the 47 (1932) 47 CLR 279 at 303-304. imputation of which the plaintiff complained arose not from the express words of the four sentences, but as a conclusion, judgment or inference from some or all of the four sentences. It was said that if it arose it was an "implied statement of deliberate concealment of evidence". There are two flaws in this submission. First, the plain meaning of the second sentence in particular is identical with the imputation: the imputation thus does not depend on any process of implication from the context and circumstances. Secondly, even if the imputation did depend on a process of implication, it remains the case that facts and comment are closely and inseverably intermingled in the publication. Thus the statements pleaded in pars 3.1-3.4 of the further amended defence, whether taken separately or together, are not comments. On these grounds pars 3.1-3.4 of the further amended defence should be struck out, and with them their supporting allegations in pars 3.5-3.39. Are the facts on which the supposed comment is alleged to be based sufficiently identified? Classification of the fair comment rules. It is often said that in addition to the rule, considered in the preceding section, that the fair comment defence does not apply to material unless it is in truth comment rather than fact, there is a rule that material cannot be fair comment unless "the facts on which it is based are stated or indicated with sufficient clarity to make it clear that it is comment on those facts"48. That is, the alleged comment must be sufficiently linked to facts being commented on by reason of those facts being stated in the publication containing the comment, or being referred to in it, or being notorious49. Justifications have been offered for the first rule which are compatible with, but distinct from, those offered for the second. One justification for the first rule is that the law, in striking a balance between the plaintiff's interest in reputation and 48 Pryke v Advertiser Newspapers Ltd (1984) 37 SASR 175 at 192 per King CJ. 49 An example of the rules being separately stated is Cheng v Tse Wai Chun (2000) 3 HKCFAR 339 at 347 per Lord Nicholls of Birkenhead NPJ. See also Pervan v North Queensland Newspaper Co Ltd (1993) 178 CLR 309 at 327 per Mason CJ, Brennan, Deane, Dawson, Toohey and Gaudron JJ and 333 and 347-351 per McHugh J; Petritsis v Hellenic Herald Pty Ltd [1978] 2 NSWLR 174 at 182 per Reynolds JA ("Even though a statement may be in form a comment, it cannot properly be regarded as such unless the facts or matter on which it is based is stated or sufficiently indicated"). competing interests in free speech, allows much more freedom to defendants who make defamatory comments than to those who publish untrue defamatory facts50: "To prohibit criticism in matters of public interest unless the critic could vouch the truth in fact of his comment would be incompatible with the principles of popular government. Abuses might exist; there might be misconduct on the part of public men; there might be extravagance and corruption; yet no person would venture to speak. Hence the law protects and encourages the interchange of opinion so vital to the conduct of popular government, even though others may believe, and it may subsequently appear, that the imputation was in fact mistaken and unjust." While "[f]air comment cannot be made a cloak for defamatory misstatements of fact", it is the case that a "great deal of latitude is permitted to those who engage in criticism of the conduct and character of persons in the public arena"51. One justification for the second rule is that given by Fletcher Moulton LJ in Hunt v Star Newspaper Co Ltd52: "[A]ny injustice ... will be to some extent negatived by the reader seeing the grounds upon which the unfavourable inference is based." "When the facts are truthfully stated, comment thereon, if unjust, will fall harmless, for the former furnish a ready antidote for the latter."53 Further, the "facts on which the comment is based [must be] sufficiently indicated or notorious to enable persons to whom the defamatory matter is published to judge for themselves how far the opinion expressed in the comment is well founded"54. They could conclude that "the writer may by his opinion, libel himself rather than the subject of his remarks"55. Another justification for the second rule is that if 50 Veeder, "Freedom of Public Discussion", (1910) 23 Harvard Law Review 413 at 51 Pryke v Advertiser Newspapers Ltd (1984) 37 SASR 175 at 191 per King CJ. 52 [1908] 2 KB 309 at 319, quoted above at [41]. 53 Veeder, "Freedom of Public Discussion", (1910) 23 Harvard Law Review 413 at 420. To "state accurately what a man has done, and then to say that in your opinion such conduct is dishonourable or disgraceful, is comment which may do no harm, as everyone can judge for himself whether the opinion expressed is well-founded or not": Christie v Robertson (1889) 10 NSWLR 157 at 161 per Windeyer J. 54 Pervan v North Queensland Newspaper Co Ltd (1993) 178 CLR 309 at 327 per Mason CJ, Brennan, Deane, Dawson, Toohey and Gaudron JJ. 55 Popham v Pickburn (1862) 7 H & N 891 at 898 [158 ER 730 at 733] per Wilde B. the underlying facts are not referred to the reader, the reader "will naturally suppose that the injurious statements are based on adequate grounds known to the writer though not necessarily set out by him"56. That is, "if the facts are not known, the opinion carries with it the implication of facts which will justify it"57. It is sometimes suggested that the search for linkage between the supposed comment and the facts commented on is relevant not only to the second rule, but also to the first. On one view, a lack of linkage is a factor which may support the conclusion that the material is not comment. Thus in Petritsis v Hellenic Herald Pty Ltd Reynolds JA said that the factors which are relevant to deciding whether a publication is fact or comment include "the relationship between the material relied upon and the alleged comment"58. On this view, the fact that material fails to satisfy the second rule may be a sign that it does not satisfy the first either: for the fact that there is no apparent link between the supposed comment and any facts may be explained by the absence of any facts to be linked, leaving the supposed comment as in reality a factual statement. A more extreme view is that that relationship is not merely a relevant factor, but essential. Thus in Crawford v Albu Bristowe J said59: "[T]he allegation must appear and be recognisable to the ordinary reasonable man as comment and not as a statement of fact and for this purpose it is necessary that the facts intended to be referred to should be clearly identified. They need not be set out. They may be merely referred to." (emphasis added) It follows from the words "for this purpose" that if there are no facts clearly identified, the supposed "comment" is not comment, but fact. This latter approach, which tends to collapse the two rules into one, was tentatively advocated by the defendant. It is not necessary to decide whether this submission is correct, for whether there are two rules or one, in this case the 56 Hunt v Star Newspaper Co Ltd [1908] 2 KB 309 at 319 per Fletcher Moulton LJ, quoted above at [41]. 57 Harper and James, The Law of Torts, (1956), vol 1, §5.28 at 459. 58 [1978] 2 NSWLR 174 at 182. 59 1917 AD 102 at 105. Similarly, in Goldsbrough v John Fairfax & Sons Ltd (1934) 34 SR (NSW) 524 at 532 Jordan CJ said: "A statement of opinion, if made to a person who has not had brought to his mind the facts on which it is based, is a statement of fact and not a comment." (emphasis added) material claimed by the defendant to be fair comment does not satisfy any of them. The majority in Pervan's case. For Australia, the rule that the facts on which the supposed comment is alleged to be based must be sufficiently identified was stated in Pervan v North Queensland Newspaper Co Ltd60. Mason CJ, Brennan, Deane, Dawson, Toohey and Gaudron JJ posed the following question about s 377(8) of the Criminal Code (Q)61: "Is the protection under that sub-section for comment which is fair only available when the facts on which the comment is based are indeed true and stated, referred to or notorious to those to whom the matter is published?" (emphasis added) They answered that question by saying that s 377(8) did not depart from the defence of fair comment as it exists at common law. In a passage referred to below as "the first passage", they said that that defence62: "is not lost by the absence of a statement of the facts on which the comment is based provided ... the facts on which the comment is based are sufficiently indicated or notorious to enable persons to whom the defamatory matter is published to judge for themselves how far the opinion expressed in the comment is well founded". (emphasis added) Their answer to the question posed was thus in the affirmative: the fair comment defence was not available unless the facts on which the comment was based were "stated, referred to or notorious to those to whom the matter [was] published". Their reasoning depends on giving the same answer to the question if asked 60 (1993) 178 CLR 309 at 316. 61 Section 377(8) provided: "It is a lawful excuse for the publication of defamatory matter – If the publication is made in good faith in the course of, or for the purposes of, the discussion of some subject of public interest, the public discussion of which is for the public benefit, and if, so far as the defamatory matter consists of comment, the comment is fair." 62 (1993) 178 CLR 309 at 327. about the common law. The reason they gave for that state of affairs was: "If the publication of defamatory matter is to be excused as fair comment under s 377(8), the reader must be enabled to judge for himself or herself whether it is fair."63 The reason so stated in what will be called "the second passage" has been repeatedly given as the basis for the common law rules relating to the fair comment defence64. The first passage from Pervan's case just quoted cited a common law authority, Kemsley v Foot65. The part of Lord Porter's speech in that case referred to by that citation began with the statement: "The question, therefore, in all cases is whether there is a sufficient substratum of fact stated or indicated in the words which are the subject-matter of the action ...". The majority in Pervan's case, by their repeated use of the words "the facts" in the first passage, revealed that they understood Lord Porter at that point in his speech to be using the words "substratum of fact" to mean "the facts". Lord Porter then said66 his view was "well expressed" in the following quotation from Odgers on Libel and Slander67: 63 (1993) 178 CLR 309 at 327. 64 Thus Fletcher Moulton LJ gave that reason in the third to sixth sentences quoted above from his much approved judgment in Hunt v Star Newspaper Co Ltd [1908] 2 KB 309 at 319-320, quoted above at [41]. See, for authorities approving what he said, n 46. In Reynolds v Times Newspapers Ltd [2001] 2 AC 127 at 201, Lord Nicholls of Birkenhead said: "Readers and viewers and listeners can make up their own minds on whether they agree or disagree with defamatory statements which are recognisable as comment and which, expressly or implicitly, indicate in general terms the facts on which they are based." He repeated that view in Cheng v Tse Wai Chun (2000) 3 HKCFAR 339 at 347, 352 and 353. In Kemsley v Foot [1952] AC 345 at 356-357 Lord Porter approved a passage from Odgers on Libel and Slander advancing that reason in a portion emphasised in the quotation from it below at [48]. See also [45] above. 65 [1952] AC 345 at 356. 66 [1952] AC 345 at 356. This quotation from Odgers continues onto the next page, but the majority in Pervan's case did not refer to that material. 67 6th ed (1929) at 166-167. "Sometimes ... it is difficult to distinguish an allegation of fact from an expression of opinion. It often depends on what is stated in the rest of the article. If the defendant accurately states what some public man has really done, and then asserts that 'such conduct is disgraceful', this is merely the expression of his opinion, his comment on the plaintiff's conduct. So, if without setting it out he identifies the conduct on which he comments by a clear reference. In either case, the defendant enables his readers to judge for themselves how far his opinion is well founded; and, therefore, what would otherwise have been an allegation of fact becomes merely a comment. But if he asserts that the plaintiff has been guilty of disgraceful conduct and does not state what that conduct was, this is an allegation of fact for which there is no defence but privilege or truth. The same considerations apply where a defendant has drawn from certain facts an inference derogatory to the plaintiff. If he states the bare inference without the facts on which it is based, such inference will be treated as an allegation of fact. But if he sets out the facts correctly, and then gives his inference, stating it as his inference from those facts, such inference will, as a rule, be deemed a comment." (emphasis added) According to the propositions which are stated in the first passage by the six majority Justices in Pervan's case, and which are supported by their reference to Odgers, a sufficient linkage between the comment alleged and the factual material relied on can appear in three ways: the factual material can be expressly stated in the same publication as that in which the comment appears (ie by "setting it out"); the factual material commented on, while not set out in the material, can be referred to (ie by being identified "by a clear reference"); and the factual material can be "notorious". Those propositions are supported by other authority in Australia68, England69, South Africa70, Hong Kong71 and the United 68 See the emphasised parts of the passages quoted above from Goldsbrough v John Fairfax & Sons Ltd (1934) 34 SR (NSW) 524 at 531-532 (see [35]) and Comalco Ltd v Australian Broadcasting Corporation (1985) 64 ACTR 1 at 40 (see [37]). See also Myerson v Smith's Weekly Publishing Co Ltd (1923) 24 SR (NSW) 20 at 26-27; Cole v The Operative Plasterers Federation of Australia (NSW Branch) (1927) 28 SR (NSW) 62 at 67; and Hawke v Tamworth Newspaper Co Ltd [1983] 1 NSWLR 699 at 704. 69 See the emphasised parts of the passages quoted from O'Brien v Marquis of Salisbury (1889) 6 TLR 133 at 137 (see [35]); Brent Walker Group Plc v Time Out Ltd [1991] 2 QB 33 at 44 (see [35]); Reynolds v Times Newspapers Ltd [2001] 2 AC 127 at 201 (see [52]). 70 See the emphasised part of the passage quoted above at [46] from Crawford v Albu 1917 AD 102 at 105. 71 Cheng v Tse Wai Chun (2000) 3 HKCFAR 339 at 347 per Lord Nicholls of Birkenhead NPJ: "[T]he comment must explicitly or implicitly indicate, at least in general terms, what are the facts on which the comment is being made. The reader or hearer should be in a position to judge for himself how far the comment was well founded." 72 It is desirable to concentrate on the American position before the influence of New York Times Co v Sullivan 376 US 254 (1964) pushed United States authority into a different framework of thinking. Restatement of the Law of Torts, (1938), vol 3, §606 required that comment be on "a true or privileged statement of fact" or "upon facts otherwise known or available to the recipient as a member of the public". Comment (b) said: "the facts upon which the opinion is based must be stated or they must be known or readily available to the persons to whom the comment or criticism is addressed". Section 606 has frequently been applied: eg Hoan v Journal Co 298 NW 228 at 236 (Wis, 1941); Kinsley v Herald & Globe Association 34 A 2d 99 at 102 (Vt, 1943); Fisher v Washington Post Co 212 A 2d 335 (DC App, 1965). There is other authority to the same effect: Cohalan v New York Tribune Inc 15 NYS 2d 58 at 61 (NY Sup, 1939); A S Abell Co v Kirby 176 A 2d 340 at 348 (Md, 1961). In Eikhoff v Gilbert 83 NW 110 at 113 (Mich, 1900), Hooker J (Montgomery CJ and Long J concurring) said that the material must afford "an opportunity to judge whether the statement was a proper deduction from the facts upon which it was based or not". The same position is supported by writers, for example, Baker, "Libel from Comment on Facts Generally Known", (1963) 23 Maryland Law Review 76 at 80; Harper and James, The Law of Torts, (1956), vol 1, §5.28 at 458-459; Thayer, "Fair Comment as a Defense", (1950) (Footnote continues on next page) An historian of the fair comment rule73 has concluded that those propositions were made explicit for the first time (after being implicit in earlier authority) as long ago as 188974. That historian saw this development as important, for in protecting only publications which "set out their premises explicitly", it increased the ease with which persons exposed to the publications could engage with them, it increased the significance given to reasoning and analysis, and it thus "both imposed and encouraged a minimum standard of reasoned debate"75. The defendant's submissions on the construction of Pervan's case. However, the defendant submitted that the reading just given to Pervan's case rested on a misconstruction of the first passage in Pervan's case. It submitted that that passage meant only that it "is enough that the subject matter, or factual substratum, of the comment" be "notorious or sufficiently indicated". The purpose of the supposed rule was to indicate to the reader, hearer or viewer merely that what was said was an opinion; to adhere to the stricter rule applied by the plaintiff in order to achieve a wider purpose, namely to receive sufficient factual material to enable an assessment of whether the opinion was right or wrong, would be unduly damaging to "the right of free expression". The defendant contended that the construction it urged was supported by another passage in the majority reasoning, by McHugh J's reasoning in his dissenting judgment in Pervan's case (which the defendant argued was not inconsistent with that of the majority), and by Kemsley v Foot (on which McHugh J's reasoning rested). It also submitted that that construction accorded with the view of Eady J in Lowe v Associated Newspapers Ltd76. It will be seen, then, that the defendant was not seeking to have Pervan's case overruled; rather it contended that on its proper construction it supported the defendant's submission. Wisconsin Law Review 288 at 289; Titus, "Statement of Fact Versus Statement of Opinion – A Spurious Dispute in Fair Comment", (1962) 15 Vanderbilt Law Review 1203 at 1239-1240. Despite what were plainly extensive researches, the defendant cited no American case which is to the contrary of the test stated by the majority in Pervan v North Queensland Newspaper Co Ltd (1993) 178 CLR 309 at 73 Mitchell, The Making of the Modern Law of Defamation, (2005) at 179. 74 O'Brien v Marquis of Salisbury (1889) 6 TLR 133 at 137. 75 Mitchell, The Making of the Modern Law of Defamation, (2005) at 179. 76 [2007] QB 580 at 588-600 [21]-[60]. Lowe v Associated Newspapers Ltd. To some extent these submissions, and the analysis in Lowe v Associated Newspapers Ltd on which they are based, pose a false issue. The question is not, as some passages in Lowe's case suggest77, whether all the facts relied on to support the comment must be expressly stated in the published material. Thus the principal object of the attacks made by counsel for the defendant and upheld by Eady J in Lowe's case, namely Lord Nicholls of Birkenhead's approach, did not assert any proposition of that kind. In Reynolds v Times Newspapers Ltd Lord Nicholls required only that the defamatory statements "expressly or implicitly ... indicate in general terms the facts on which they are based"78. Similarly, in Cheng v Tse Wai Chun, Lord Nicholls said only that "the comment must explicitly or implicitly indicate, at least in general terms, what are the facts on which the comment is being made"79. The question is rather whether the proposition stated by the majority in Pervan's case is correct, namely that the facts on which comment is supposedly based are "stated, referred to or notorious". That is a proposition compatible with Lord Nicholls' approach. It also accords with the following agreed statement by English counsel as late as 200280: "[I]t is necessary ... to decide whether the hypothetical person could honestly express the commentator's views on the assumption that he knows (a) facts accurately stated in the article, (b) facts referred to in the article and (c) facts that are so well known that they may be described as general knowledge". Eady J recorded counsel for the defendant in Lowe's case as contending that that was "an illustration of how deeply the heresy has taken hold in the minds of practitioners and judges; that is to say, the mistaken belief (as she submits) that it is a necessary ingredient in a defence of fair comment that the facts upon which the comment was based should be set out, at least in general terms, in the words complained of"81. 77 For example [2007] QB 580 at 596 [42]. A similar extreme proposition is put up to be demolished by Lord Ackner in Telnikoff v Matusevitch [1992] 2 AC 343 at 361, in a passage relied on by the defendant. 78 [2001] 2 AC 127 at 201 (emphasis added). See n 64. 79 (2000) 3 HKCFAR 339 at 347 (emphasis added). See n 71. 80 Branson v Bower [2002] QB 737 at 748 [30]. Agreements by counsel are not authorities and do not make the law, but they can provide lucid statements of it. 81 Lowe v Associated Newspapers Ltd [2007] QB 580 at 591 [25]. The conclusion reached by Eady J is, with respect, not wholly clear. He rejected the submissions of counsel for the plaintiff and upheld the pleading of fair comment on which the defendant was relying. He quoted Lord Porter's statement that the key question was: "Is there subject-matter indicated with sufficient clarity to justify comment being made?"82 He contended that Kemsley v Foot held "that comment may be made, if the matter is already before the public, without setting out the facts on which the comment is based – provided the subject matter of the comment is plainly stated"83. Later he said that Kemsley v Foot held that "a defendant is not precluded from pleading extrinsic facts in support of a plea of fair comment"84. He also said85: "[T]he readers need to be able to distinguish facts from comment for the defendant to be permitted to rely upon the defence of fair comment. A bald comment, made in circumstances where it is not possible to understand it as an inference, is likely to be treated as an assertion of fact which will only be susceptible to a defence of justification or privilege. Where facts are set out in the words complained of, so that the reader can see that an inference or opinion is based upon them, then the defence of fair comment will be available; but the defendant is not tied to the facts stated in the article. He may invite the jury to take into account extrinsic facts 'known to the writer' as part of the material on which they are to decide whether a person could honestly express the opinion or draw the inference. Whilst it is necessary for readers to distinguish fact from comment, it is not necessary for them to have before them all the facts upon which the comment was based for the purpose of deciding whether they agree with the comment (or inference). I draw that conclusion with all due diffidence, since Lord Nicholls has twice expressed the opposite view, but it does seem consistent with principle and, in particular, with the undoubted rule that people are free to express perverse and shocking opinions and may nevertheless succeed in a defence of fair comment 82 Kemsley v Foot [1952] AC 345 at 357: see Lowe v Associated Newspapers Ltd [2007] QB 580 at 596 [42]. 83 Lowe v Associated Newspapers Ltd [2007] QB 580 at 596 [42]. 84 Lowe v Associated Newspapers Ltd [2007] QB 580 at 599 [55]. 85 Lowe v Associated Newspapers Ltd [2007] QB 580 at 599-600 [55]-[57]. without having to persuade reasonable readers, or the jurors who represent such persons, to concur with the opinions. It is difficult to see why it should matter whether a reader agrees; what matters is whether he or she can distinguish fact from comment." Of course it does not "matter whether a reader agrees": the point is that material which the reader perceives only to be a comment will be less damaging than material which the reader may take to be a factual assertion, particularly if the comment is not supported by the facts. To this point Eady J's reasoning appears to accept in full the defendant's attack on the "heresy" reflected in the agreed statement of English counsel and in Lord Nicholls' approach. On that reasoning all that matters is that a subject matter be indicated – not a substratum of facts, let alone precisely identified facts. However, Eady J at once retreated from that conclusion by saying that sometimes the process by which a reader can distinguish fact from comment "will be possible, as it was in Kemsley v Foot, without any facts being stated expressly, because either they are referred to or they are sufficiently widely known for the readers to recognise the comment as comment"86. He gave three examples of these distinctions87: "(i) the minister is unfit to hold public office because he lied to the House of Commons; (ii) the minister is unfit to hold public office because of what he said in the House last week; (iii) Mr A (who is widely known to have pleaded guilty to perjury) is unfit to hold public office. Obviously, in the first example the fact is stated, in the second it is referred to, and in the third the facts are notorious." (emphasis added) So to reason is to adopt the approach taken by the majority in Pervan's case, not to reject it, for it concentrates on "facts", not "subject matter". The third passage in Pervan's case. Whatever the present state of English law, the defendant's submissions in relation to the majority reasoning in Pervan's case centred on what will be called below "the third passage" – the majority's statement that they had arrived at88: 86 Lowe v Associated Newspapers Ltd [2007] QB 580 at 600 [57]. 87 Lowe v Associated Newspapers Ltd [2007] QB 580 at 600 [58]. 88 (1993) 178 CLR 309 at 330. "a rejection of the appellant's final contention that, if the whole of the publication consisted of comment, there were no facts relevantly stated or indicated on which it was based. There was a clear substratum of fact on which the publication was based, consisting of the statements made in Parliament, and that is all that is required." (emphasis added) The "statements made in Parliament" were statements alleging that the appellant, a member of a Shire Council, had misapplied the Council's cyclone relief funds and had been "feathering his own nest". The respondent newspaper published an advertisement for a public meeting in the following terms89: "Councillors feathering their own nests? Funds being misappropriated? This is doing [irreparable] damage to the image of our shire. It is now more important than ever to attend the ratepayers and residents meeting at the Grand Central Hotel Tuesday, 12th August at 8 pm." By "substratum of fact" the majority meant the statements in Parliament, which were notorious, having been the subject of a fair report by the newspaper which had published the advertisement and of replies by the Council, various councillors and the appellant's brother, to the allegations published by that newspaper90 – a process described as "the subsequent newspaper debate"91. That is, "substratum of fact" meant only "facts". The two expressions were used indifferently in the two sentences making up the third passage. There is thus nothing in the third passage, relied on by the defendant, which is inconsistent with the first passage, relied on by the plaintiff. McHugh J's dissenting judgment in Pervan's case. The defendant also contended that the explanation of the defence of fair comment in McHugh J's dissenting judgment was not inconsistent with the majority reasoning. The passage on which the defendant relied began with a statement that a defamatory comment may be based on facts "not published in the article". It continued92: "This is often the case where a play or sporting spectacle is being reviewed, but it is certainly not limited to plays or spectacles. To raise the defence of fair comment in this class of case, it is sufficient that either 89 (1993) 178 CLR 309 at 310. 90 (1993) 178 CLR 309 at 314 and 332. 91 (1993) 178 CLR 309 at 318. 92 (1993) 178 CLR 309 at 340. expressly or by implication the defendant has identified the subject matter of the comment. The defence is available even though the publication does not state or indicate the facts which form the basis of the comment. As long as the subject matter of the comment is identified, the defendant is entitled to the benefit of the defence of fair comment if he or she is able to prove one or more facts which will justify the comment93. The difference between identifying the subject matter or substratum of fact of the comment and the facts which justify the comment is vital. The comment must indicate the subject matter or substratum of fact of the comment, but the defence does not fail because the publication does not indicate the individual facts which are the basis of the comment. It is the 'substratum' of fact94 not the individual facts which must be identified. If a critic states that a professional footballer played badly and the jury holds that the statement is comment, the critic is entitled to rely on any fact which will support that comment even though the fact is not stated in the article or notorious and no reader saw the game." "The distinction between the subject matter or the substratum of fact and the facts which justify the comment is drawn out in two illuminating passages in the speech of Lord Porter in Kemsley v Foot. The first states96: 'the inquiry ceases to be – Can the defendant point to definite assertions of fact in the alleged libel upon which the comment is made? and becomes – Is there subject matter indicated with sufficient clarity to justify comment being made? and was the comment actually made such as an honest, though prejudiced, man might make?' 93 Kemsley v Foot [1952] AC 345 at 358, 362. 94 Kemsley v Foot [1952] AC 345 at 356. 95 (1993) 178 CLR 309 at 340-342. 96 [1952] AC 345 at 357. The second states97: 'In a case where the facts are fully set out in the alleged libel, each fact must be justified and if the defendant fails to justify one, even if it be comparatively unimportant, he fails in his defence. Does the same principle apply where the facts alleged are found not in the alleged libel but in particulars delivered in the course of the action? In my opinion, it does not. Where the facts are set out in the alleged libel, those to whom it is published can read them and may regard them as facts derogatory to the plaintiff; but where, as here, they are contained only in particulars and are not published to the world at large, they are not the subject matter of the comment but facts alleged to justify that comment. In the present case, for instance, the substratum of fact upon which comment is based is that Lord Kemsley is the active proprietor of and responsible for the Kemsley Press. The criticism is that that press is a low one. As I hold, any facts sufficient to justify that statement would entitle the defendants to succeed in a plea of fair comment. Twenty facts might be given in the particulars and only one justified, yet if that one fact were sufficient to support the comment so as to make it fair, a failure to prove the other nineteen would not of necessity defeat the defendants' plea.' ([McHugh J's] emphasis.) Equally illuminating is a passage in the speech of Lord Oaksey98: 'A defendant who has made a defamatory comment on a matter of public importance must be entitled to adduce any relevant evidence to show that the comment was fair, and in order to do so much be entitled to allege and attempt to prove facts which he contends justify the comment. Whether the facts alleged are satisfactorily proved or not, it will still be for the jury to say whether they consider that the comment in the circumstances proved might have been made by an honest man.' Fair comment in the Kemsley situation is very different from what may be called the conventional case of fair comment. In the conventional 97 [1952] AC 345 at 357-358. Lord Tucker expressly agreed (at 362) with this passage in Lord Porter's speech. 98 [1952] AC 345 at 361. case, the basis of the comment appears in the publication. The reader is able to judge whether the facts justify the comment. Once the defendant proves the facts which are the basis of the comment, that person is entitled to the benefit of the defence unless the opinion expressed by the defendant was not honestly held. But in a situation such as that in Kemsley, the reader does not know what facts were the basis of the comment. Unless litigation ensues, the reader will never know what particular facts the defendant had in mind. Moreover, as the second passage from the speech of Lord Porter makes plain, the defence may succeed even though some or most of the 'facts' which the defendant had in mind were untrue. If the facts forming the basis of the comment always had to be drawn to the reader's attention, effective comment on many subjects would be frustrated. No doubt, it is for this reason that the common law provides for a defence of fair comment if the subject matter or 'substratum of fact' of the comment is sufficiently indicated without requiring that the particular facts justifying the comment be set out or indicated. The plaintiff's protection is found in the rule that the defence will fail unless the defendant proves the truth of sufficient facts to justify the comment." The defendant also pointed out that although Lord Porter quoted Odgers as saying "the defendant enables his readers to judge for themselves how far his opinion is well founded"99, McHugh J had said that the later passages from Lord Porter which he had quoted "make it plain that his Lordship was not saying that the facts which justify the comment must be placed before the reader. Quite the contrary."100 Several points must be made about the defendant's reliance on these passages. First, McHugh J's comments on the common law position were dicta. The case turned on s 377(8) of the Criminal Code (Q), and McHugh J held that s 377(8) differed from the common law101. Secondly, although McHugh J's account of the common law followed closely the reasoning in Kemsley v Foot, recourse to the written arguments, and the transcript of the oral arguments, in Pervan's case confirms what the reported 99 See above at [48]. 100 (1993) 178 CLR 309 at 345. 101 (1993) 178 CLR 309 at 342. arguments suggest – that counsel did not refer to Kemsley v Foot. The first ground of the notice of appeal in that case was: "The Full Court erred in holding that for the purposes of [s 377(8)] it was not necessary for the [respondent] to establish that so much of the defamatory publication as consisted of comment had to be true or based on true facts stated." The appellant contended that "fair comment" in s 377(8) "imports the common law requirement that fair comment be an honest or genuine opinion expressed with regard to facts that are truly stated or identified". The respondent contended that "fair comment" in s 377(8) did not cause "all the requirements of the common law defence of fair comment [to] be imported into [s 377(8)], including the requirements of proving that any comment be based on facts truly stated". The arguments of the parties do not reveal any controversy between them in relation to the content of the common law rule about facts being "stated or identified" or "stated". It is thus not surprising that they did not refer to any common law case bearing on that question, and in particular did not refer to Thirdly, it may be true that facts which are not stated, referred to or notorious in reviews of plays or sporting spectacles can form the basis of a fair comment defence – perhaps because it is not easy to break up the relevant parts of the play or sporting spectacle into particular facts, or perhaps because the play or sporting spectacle is identified and its promoter holds it out for comment. It may also be true that that principle extends beyond reviews of plays or sporting spectacles. Perhaps the somewhat special facts of Kemsley v Foot fall fairly within the principle so extended; or the outcome may be justified on the ground that the facts about the Kemsley newspapers underlying the comment "lower than Kemsley" were notorious. Lord Porter in Kemsley v Foot did not suggest that the principle relevant to plays and spectacles extended to all publications. He said102: "If an author writes a play or a book or a composer composes a musical work, he is submitting that work to the public and thereby inviting comment ... The same observation is true of a newspaper. Whether the criticism is confined to a particular issue or deals with the way in which it is in general conducted, the subject-matter upon which criticism is made has been submitted to the public, though by no means all those to whom 102 [1952] AC 345 at 355-356. the alleged libel has been published will have seen or are likely to see the various issues. Accordingly, its contents and conduct are open to comment on the ground that the public have at least the opportunity of ascertaining for themselves the subject-matter upon which the comment is founded." But, subject to an argument put by the defendant to be considered below103, the present circumstances are very remote from the problems arising with plays, sporting spectacles, newspapers or anything like them. The defendant submitted that "it is difficult to see the rationale for confining this category of case in that way". If the defendant were contending that the majority approach in Pervan's case should be overruled, it would be necessary to give detailed attention to that submission. It would also be necessary to consider submissions by the defendant that the paramount interest in free speech was unduly restricted by that approach, particularly in relation to very short broadcasts like the promotion, and submissions seeking to identify the precise rationale of particular rules with a view to ensuring that the rules conform to those rationales. But since the defendant's argument is presented only as a question of working out what the majority in Pervan's case meant, it is not necessary to deal with these policy-based and potentially radical submissions. The specific use made by the defendant of McHugh J's analysis. The defendant sought to make use of McHugh J's analysis of the common law in the following way. It submitted that the majority "reasons (like those of McHugh J) appear to indicate an endorsement of the approach taken in Kemsley v Foot". It referred to the first passage from the majority judgment quoted above104 and said: "While their Honours referred to a requirement that the 'facts' be sufficiently indicated or notorious, the passage cited from the speech of Lord Porter in Kemsley v Foot uses the term 'substratum of fact'. (And, as McHugh J explained, the balance of their Lordships' speeches in Kemsley v Foot make it clear that the common law only requires that the substratum of fact, or subject matter, of the comment be sufficiently indicated or notorious.) Further, when the majority returned to this issue later in their reasons [in the third passage], they decided the issue on the basis that the 'substratum of fact' (as opposed to the 'facts') had been made clear.105" 103 See [70]. 105 (1993) 178 CLR 309 at 330. The defendant also submitted that the suggestion by the majority in Pervan's case that readers or viewers must be in a position to judge for themselves whether the comment was well founded had its origins in the extract from Odgers contained in Lord Porter's speech in Kemsley v Foot. It submitted: "For the reasons explained by McHugh J ... this sentence cannot be reconciled with the balance of the speeches ... in [Kemsley v Foot], and it follows that Lord Porter cannot have intended to endorse that particular sentence from Odgers. Given the apparent approval by the majority in Pervan of the decision in Kemsley v Foot, the majority's reference to a reader being able to judge the fairness of the comment cannot be taken literally, or as expressing a universal requirement. It is unlikely that their Honours intended to depart from the effect of Kemsley v Foot in this way." These arguments must be rejected. The reasoning just quoted seems to be: despite Lord Porter's stated approval of the criticised sentence in the Odgers passage, that sentence is irreconcilable with the rest of Kemsley v Foot, and so Lord Porter did not in fact approve it; therefore the approval given by the majority in Pervan's case of the entire Odgers passage was in truth not an approval of the criticised sentence despite its summary and repetition. Whatever the merit of step (a), step (b) does not follow from it – particularly since the criticised sentence in Odgers is in fact supported by much other authority106. In short, the citation by the majority in Pervan's case of a single page of Lord Porter's speech, most of which is a quotation from Odgers, cannot be taken as an adoption of all that Lord Porter said in other parts of his speech. Nor can a passing reference to "substratum of fact" in the third passage amount to an adoption, as a general rule, of any principle that the facts on which the comment is based need not be "stated, referred to or notorious to those to whom the matter is published". First, that would contradict the answer which the majority gave to the question they isolated for determination in relation to s 377(8), for the answer they gave to the question posed about s 377(8) was the 106 See n 64. same as that which they gave in describing the common law: the facts on which the comment is based must be "stated, referred to or notorious". Secondly, for reasons given above107, in the third passage the majority were using the expression "substratum of fact" to mean "facts". It would be peculiar to treat the meaning of the principle stated in the first passage as being controlled by reference to an expression, "substratum of fact", used only in the course of the application of the principle in the third passage, but not in the course of its statement in the first passage. Survival of the majority approach. The defendant contended that what McHugh J said was a statement of the general law not limited to plays and sporting spectacles. It is not clear that it is to be read in that way. But even if it can be so read, it does not follow that it is either a guide to, or not inconsistent with, the majority approach. If the defendant's construction of the majority reasoning were sound, it would mean that the majority had concurred, without saying so, in an account of the common law relating to fair comment which, however much it might be supported by remarks in Kemsley v Foot on which they did not rely, was out of line with longstanding authority in many jurisdictions108. The majority would have changed the fair comment defence from one of fair comment on facts indicated and accurately stated into one of fair comment on indicated topics of public interest. To have made that change would have been to take a radical step not suggested as appropriate either by the main trends in the authorities or by any relevant principle. In these circumstances it is not possible to construe the majority as having taken any of these steps. The defendant's construction of what the majority said is not correct. Analogy with plays and spectacles. Finally, the defendant submitted that the present case was analogous to plays or spectacles and should be governed by the special rules that apply to them. The defendant referred to what Lord Porter said about how playwrights, authors and composers submit their work to the public and invite comment109: "Not all the public will see or read or hear it but the work is public in the same sense as a case in the Law Courts is said to be heard in public. In many cases it is not possible for everyone who is interested, to attend a trial, but in so far as there is room for them in the court all are entitled to 108 See above at [49]. 109 Kemsley v Foot [1952] AC 345 at 355. do so, and the subject-matter upon which comment can be made is indicated to the world at large." This argument might call for close consideration if the imputation had been limited to what the plaintiff had done in court. But in large measure it was directed at what he had not done in court and at what he had done outside it, in the investigation stage – that is, it was directed to non-public events. Of the 20 paragraphs set out in pars 3.19-3.25 and 3.27-3.39 (par 3.26 having been abandoned), only eight relate to the behaviour of the plaintiff in court (as distinct from his behaviour outside the court and the behaviour of others in court). The defendant submitted that the forensic investigation was inextricably linked to the trial because "an aspect of the criticism is that in giving evidence in Court the [plaintiff] failed to disclose certain matters arising out of the investigation". That does not alter the fact that many of the matters alleged in pars 3.19-3.39 either had nothing to do with the plaintiff or had nothing to do with what could be observed of the plaintiff's conduct in court, and hence were quite unascertainable by viewers. The plaintiff's attack on Kemsley v Foot. The plaintiff attacked the correctness of Kemsley v Foot on the ground that it extended a line of authority holding that where the defamatory material was criticism of literary, musical or artistic works which had been published or made available to the public, sufficient identification of the facts commented on could be found if the works were clearly identified in the publication even though they were not reproduced in it. The extension attacked by the plaintiff was an extension to holding, in relation to criticism of how well-known newspapers were conducted, that the facts were sufficiently identified by setting out excerpts from the newspapers and making adverse allegations about their inaccuracy, untruthfulness, faults of tone and improper dealing with the news reported in them. That attack of the plaintiff was designed to forestall the further extension which the defendant's submissions called for. The plaintiff pointed to what it described as language involving dangerous slides from "facts" to "substratum of fact" to "subject matter" or "topics"110, and said that to embrace these slides generally would be to change the law very radically. 110 An example discussed by the plaintiff is the first of the passages in Lord Porter's speech quoted by McHugh J in Pervan's case (1993) 178 CLR 309 at 340, quoted above at [57]. That passage was preceded by the words: "it was ultimately admitted on behalf of the appellant that the facts necessary to justify comment might be implied from the terms of the impugned article and therefore ...": Kemsley v Foot [1952] AC 345 at 357. It does not follow from the circumstance that the "facts" can legitimately be "implied" from the impugned publication that (Footnote continues on next page) The correctness of the plaintiff's attack need not be considered in this appeal. None of the three passages in the majority judgment in Pervan's case depended on any of these slides. They rest on the need for the facts on which comment is based to be "stated, referred to or notorious" – the facts, not a different thing labelled a "substratum of fact", a "subject matter" or a "topic". The law in Australia must be found in the majority judgment in Pervan's case, not in Lord Porter's speech. Since the defendant did not seek to have it overruled, it must be applied. Conclusion. The factual material relied on in pars 3.19-3.39 of the further amended defence relates to the investigation of Anna-Jane Cheney's murder and Mr Keogh's criminal trials. First, if the four sentences pleaded in pars 3.1-3.4 of the further amended defence are, as the pleading alleges, comment, the promotion does not expressly state any facts on which that comment is being made. They do not identify the "evidence they kept to themselves", or any facts on which that statement is based. They do not specify the "data, dates and documents", or the discrepancies between them which prevent them from adding up. They do not say what the "new" facts are. They do not specify the "evidence" which changed or any facts on which that statement is based. Secondly, the four sentences do not identify, "by a clear reference" or otherwise, any facts, let alone those referred to in pars 3.19-3.39. Thirdly, it has not been shown that there are any notorious facts on which those four sentences can be understood as making comment. That there are no notorious facts is suggested by the statement: "The new Keogh facts". If they are new to viewers, and are only to be revealed when the programme being promoted is broadcast, they are not notorious. It is true that pars 3.15 and 3.16 of the "Particulars of Public Interest" refer to a television programme and a newspaper article voicing "a number of concerns regarding the conviction of Mr Keogh and, in particular, the forensic investigations and evidence of the plaintiff". But there is no allegation that those concerns were the matters referred to in the promotion. Paragraph 3.17 refers to a complaint to the Medical Board of South Australia about the plaintiff's conduct "in relation to his investigations and evidence in the Ms Cheney case", but this was not alleged to be notorious. So far as pars 3.19-3.39 refer to inadequacies in the plaintiff's investigations, they are not alleged to be notorious. And so far as pars 3.19-3.39 refer to errors in the plaintiff's evidence, while the trials took place in public, it is not alleged that those errors are notorious. Indeed the defendant accepted that at least some of the facts were not notorious: its the inquiry should shift from an inquiry into whether there are assertions of fact in the alleged libel to whether some "subject matter" has been indicated. position was that they did not have to be notorious, and that it was sufficient that the "subject matter" was notorious. It follows that pars 3.1-3.4 do not comply with the rules stated in Pervan's case. The facts which pars 3.19-3.39 alleged to be the facts on which the comments are based are not sufficiently indicated or notorious to enable the viewers who saw the promotion to judge for themselves how far the opinions expressed in the "comments" were well founded. That conclusion is sufficient to lead to the conclusion that pars 3.1-3.39 should be struck out. Is the meaning pleaded by the plaintiff relevant to the defence of fair comment pleaded by the defendant? The plaintiff pleaded that the meaning of the promotion was that he "had deliberately concealed evidence from the trials of Mr Keogh". None of pars 3.18-3.39, pleaded in support of the defendant's plea of fair comment, squarely state that the plaintiff "deliberately concealed" (that is, consciously suppressed) evidence. Many of them were either about the shortcomings of persons other than the plaintiff or inadequacies in the plaintiff's investigation of the crime. The balance alleged inaccuracies, inconsistencies and unreliabilities in the plaintiff's evidence, but, subject to one argument of the defendant to be considered later111, not deliberate concealment. It was on this ground that the Full Court decided to order that pars 3.18-3.39 should be struck out: "The defence of fair comment must address the imputation pleaded."112 The defendant's argument rested on two propositions: unlike the position in New South Wales, under the now repealed Defamation Act 1974, s 9(2), which rendered each of the plaintiff's imputations a cause of action, at common law the cause of action lies in the words or matter published; the defence of fair comment "is not directed to meaning (let alone the plaintiff's imputation). Comment is concerned with the form of expression, that is, comment attracts protection because of the form in 111 See [88]-[92]. 112 Manock v Channel Seven Adelaide Pty Ltd (2006) 95 SASR 462 at 480 [43] per which it is expressed. It follows logically that the defence of comment is, and should be, directed to the words or matter complained of, and not the imputations conveyed." Pleading does not meet defendant's criterion. Even if the defendant is correct in arguing that it suffices for the defence of comment to be directed to the words complained of, the pleading does not meet that criterion. If the words referred to in par 3.2 of the further amended defence, "the evidence they kept to themselves", had not been used, the promotion would have been a very different and much less serious defamation. Paragraphs 3.5-3.39 do not allege any instance of the plaintiff keeping evidence to himself – that is, deliberately suppressing it. The defendant relied on pars 3.25.2, 3.26.1, 3.33.3, 3.35, 3.35.4, 3.35.15, 3.38.2 and 3.39.2. Paragraph 3.26.1 must be treated as abandoned, because the particulars given have been abandoned for the reason that the event referred to post-dated the broadcast. Paragraphs 3.25.2 and 3.33.3 do not allege deliberate suppression. Paragraph 3.35 alleges that the plaintiff "failed to adequately disclose the basis" for his exclusion of accidental drowning as a possible cause of death and par 3.35.4 alleges that "he knew that he had not excluded on any scientific basis" the possible causes of death which did not involve foul play. To allege a failure "adequately" to disclose leaves open the possibility of some disclosure. To allege that the plaintiff knew that he had failed to exclude matters "on any scientific basis" leaves open other possibilities. Neither paragraph alleges deliberate suppression. Paragraph 3.35.15 shares these characteristics of pars 3.35 and 3.35.4. Paragraphs 3.38.2 and 3.39.2 allege a failure by the plaintiff to disclose in evidence his failure to conform to certain aims and requirements, but they do not allege that the plaintiff was conscious of those aims and requirements, or of his failure to conform to them. One cannot deliberately suppress something unless one is aware of that thing, and turns one's mind to it at a time when it should be disclosed. Indeed in the end the defendant conceded that taken individually the paragraphs did not allege any deliberate failure to disclose. Flaws in defendant's criterion. However, it is desirable to deal with the parties' arguments on the issue of principle113. 113 There is authority against the defendant's contention. It is contradicted by the following dictum of Brennan CJ and McHugh J in Chakravarti v Advertiser Newspapers Ltd (1998) 193 CLR 519 at 528 [8]: "A plea of ... fair comment ... in respect of an imputation not pleaded by the plaintiff does not plead a good defence." See also Moir v Flint [2002] WASC 48 at [24] per McLure J. One point about nomenclature should be made. Both the Full Court114 and the parties spoke of the meaning which the plaintiff pleaded of the promotion as an "imputation". That is not an uncommon usage in discussing the common law defence of fair comment115. But in view of the fact that the cases in New South Wales on the Defamation Act 1974 apply the expression "imputation" – because it was the expression compelled by s 9 – it is desirable to avoid that expression when discussing the common law, which applies in South Australia. One vice in the defendant's argument was that it consisted of, and relied largely on116, statements asserting the desired conclusion but without any explanation of why that conclusion followed in principle. The fullest explanation of why the conclusion follows in the authorities on which the defendant relied appears in a case which does not involve the common law defence, but rather the defence given by the Defamation Act 1974 (NSW), Pt 3, Div 7. In Petritsis v Hellenic Herald Pty Ltd117 Samuels JA said: "[A] defence of comment, accepting that the comment is defamatory, is not concerned with the precise nature of the defamatory meaning or imputation. It asserts that, whatever the defamatory character of the matter ... the words complained of are comment (within Div 7) and are, therefore, not actionable. The defence does not challenge that the matter has a defamatory meaning, or defamatory meanings; or what those meanings are. It is directed to the character of the vehicle by which those meanings, whatever they are, are conveyed; that is by a statement of fact or by a statement of opinion. It must, therefore, penetrate beyond the alleged meanings to the raw material of the actual words employed. In my opinion, a defence of comment under the 1974 Act must be directed, not to the imputations specified in the statement of claim, but to the matter as defined in s 9(1). It should identify those parts of the matter which the defendant accepts as defamatory and alleges to be comment ... 114 Manock v Channel Seven Adelaide Pty Ltd (2006) 95 SASR 462 at 480 [43] per 115 See, for example, Peter Walker & Son Ltd v Hodgson [1909] 1 KB 239 at 253 per Buckley LJ. 116 For example, Bob Kay Real Estate Pty Ltd v Amalgamated Television Services Pty Ltd (1985) 1 NSWLR 505 at 512 per Hunt J: "[T]he common law defence of fair comment was never directed to the imputation". 117 [1978] 2 NSWLR 174 at 193. See Reynolds JA's similar conclusion at 184. [The trial judge] may tell the jury that the defendant ... contends that the words said to carry the imputations are not statements of fact, but statements of opinion. And this is the issue which he may invite the jury first to consider; because, if the portions of the matter which allegedly give rise to the imputations specified amount to comment, then if that comment satisfies the provisions of Div 7, the defence is made good, subject to s 34(2). It is only if the jury rejects the defence that they need to examine the imputations. Whether the jury starts with comment, or with truth, their consideration of comment concerns the matter and not the imputations." That passage ceased to represent the law in relation to the fair comment defence under the Defamation Act 1974 (NSW)118. In any event, Samuels JA had dealt with the common law position earlier when he said that the problem did not arise before 1974119: "The defendant pleaded fair comment either to 'the matter complained of which is defamatory of the plaintiff' (a defence of comment is, of course, a plea in confession and avoidance120), or to a specified portion of the matter complained of 'which is defamatory of the plaintiff'. In every case, the defence was pleaded to the matter alleged to be defamatory and not to the particular imputations which that matter was alleged to convey." Here the defendant, after denying the meaning alleged by the plaintiff and denying that the promotion referred to the plaintiff, "[f]urther, or in the alternative", pleaded fair comment to the matter complained of which is defamatory of the plaintiff, namely the four sentences set out in par 4 of the statement of claim and pars 3.1-3.4 of the further amended defence. The issues set up by the pleadings are thus structured as follows. The plaintiff pleaded in par 5 of the statement of claim only one meaning – that the plaintiff had deliberately concealed evidence. The defendant denied that the promotion bore 118 David Syme & Co Ltd v Lloyd [1984] 3 NSWLR 346 at 356-358 and 361; Lloyd v David Syme & Co Ltd [1986] AC 350 at 365; Radio 2UE Sydney Pty Ltd v Parker (1992) 29 NSWLR 448 at 470-471; New South Wales Aboriginal Land Council v Perkins (1998) 45 NSWLR 340; cf Bob Kay Real Estate Pty Ltd v Amalgamated Television Services Pty Ltd (1985) 1 NSWLR 505. 119 Petritsis v Hellenic Herald Pty Ltd [1978] 2 NSWLR 174 at 191-192. 120 Goldsbrough v John Fairfax & Sons Ltd (1934) 34 SR (NSW) 524 at 531 [per Jordan CJ: "The defence is one which assumes the defamatory nature of the matter complained of."] that meaning. If the plaintiff were to fail to establish that the promotion bore that meaning or a meaning not substantially different, the trial judge would not have to go further and the proceedings would be dismissed. If the plaintiff's allegation were to succeed and the defendant's denial were to be rejected, the defendant's further and alternative plea of fair comment would have to be considered. There would be no disparity or difference between the "precise nature of the defamatory meaning" on the one hand and the "matter" or "the raw material of the actual words employed" on the other. The matter sued on – 28 words spoken while a picture of the plaintiff was displayed on the screen – would have been found to have had the meaning alleged, and the only question would be whether those 28 words, bearing that meaning, constituted fair comment. Hence the defendant's contention that in this case the meaning pleaded by the plaintiff is irrelevant to the defence of fair comment at common law is wrong. It is wrong because by the time the trial judge comes to consider the fair comment defence the question of meaning will have been decided adversely to the defendant. The meaning found is the comment to be scrutinised for its fairness. An initial question will be whether the ordinary reasonable viewer would have understood that the meaning found to have been conveyed was conveyed as comment121. Another question would be whether that meaning was objectively fair. Another would be whether it was based on true facts. Each of the questions must be answered by treating the comment as being the 28 words in the meaning which the court found. If the defendant's contention were not wrong, it would be open to the defendant to contend that the promotion bore some meaning other than the defamatory meaning which the trial judge had already found, which is impossible. What the Privy Council said in Lloyd v David Syme & Co Ltd122, in a case on the Defamation Act 1974 (NSW), is equally applicable to the common law: "Comment must have a meaning, and ex hypothesi the [trier of fact is] proceeding on the footing that its meaning is defamatory in the sense of the pleaded imputations which have been found established." 121 Myerson v Smith's Weekly Publishing Co Ltd (1923) 24 SR (NSW) 20 at 26; Smith's Newspapers Ltd v Becker (1932) 47 CLR 279 at 296-297 and 302; Bailey v Truth and Sportsman Ltd (1938) 60 CLR 700 at 724-725; Radio 2UE Sydney Pty Ltd v Parker (1992) 29 NSWLR 448 at 464 and 469. 122 [1986] AC 350 at 365 per Lords Keith of Kinkel, Elwyn-Jones, Roskill and Griffiths. Similarly, in Pervan's case123 the majority said: "[A]t common law ... it is for the jury to decide whether what has been published is a statement of fact or an expression of opinion. It is only if the imputation is reasonably capable of being regarded only as fact or only as comment that the trial judge may take the question away from the jury." Thus it is "the imputation" which must be "reasonably capable of being regarded ... only as comment". The defendant's position depends on a distinction between the "raw material of the actual words employed" and their meaning. Words are, when used orally, sounds, and when used in writing, marks on paper or some other material. In some contexts words have significance independently of their meanings. If the question is whether a person is dumb, the fact that a witness heard that person speak words in a language which the witness cannot speak would be relevant, even though the witness did not understand their meaning. If the question is whether a piece of paper was blank or not, the fact that a person observes marks on it is relevant even though the person cannot say what those marks, being words, are because of illiteracy. Words arranged in a montage could be part of a work of visual art even though they are in a language unknown to viewers. But outside contexts of this kind, the only significance of words lies in their meaning. There is no relevant difference between the "raw material of ... actual words" and their meaning. Another flaw in the defendant's position is that the defendant accepts, correctly, that the meaning of defamatory words is relevant to the fair comment defence in several ways: in determining whether the comment is fair; in determining the issue of malice, to which an absence of honest belief in the proposition stated is relevant; in determining whether the plaintiff's pleaded meaning was conveyed as a statement of fact or a statement of opinion; in determining whether the plaintiff's pleaded meaning and the defendant's comment relate to the same allegation; in determining whether the comment is based on facts which are true or protected by privilege, a question which cannot be answered without assessing what the comment means; and in determining whether the comment relates to a matter of public interest, which also depends on its meaning. It would be anomalous if the meaning of the comment is relevant in all these respects, but not relevant in an assessment of whether it responds to the meaning of the promotion pleaded by the plaintiff. 123 (1993) 178 CLR 309 at 317 per Mason CJ, Brennan, Deane, Dawson, Toohey and Finally, the defendant's submissions would lead to an injustice. In this case the defendant's submissions would lead to the conclusion that if the plaintiff establishes the meaning pleaded, he will have been accused of deliberately concealing evidence, while the defendant will escape liability by saying merely that he was incompetent and mistaken in various respects. There is a great gulf between displaying incompetence and deliberately concealing evidence. For these reasons too pars 3.1-3.39 should be struck out. Could the criticisms in pars 3.19-3.39 lead an honest person to think that the plaintiff had deliberately concealed evidence? The defendant submitted that an "honest person, allowing for the fact that that person might be prejudiced and hold exaggerated or obstinate views, could, on the basis of the pleaded accumulation of such a large number of inconsistencies and inadequacies, hold the opinion that there had been some deliberate concealment on the part of the plaintiff". This submission must be rejected. First, the test propounded does not accord with classic statements of the law. Thus in Goldsbrough v John Fairfax & Sons Ltd124 Jordan CJ said comment could not be fair "if the opinion is one that a fair-minded man might not reasonably form upon the facts on which it is put forward as being based" (emphasis added). And in O'Shaughnessy v Mirror Newspapers Ltd125 Jacobs and Mason JJA said: "[D]efamatory matter which appears to be a comment on facts stated or known but is not an inference or conclusion which an honest man, however biased or prejudiced, might reasonably draw from the facts so stated or known will not be treated as comment" (emphasis added). In final address it was submitted the High Court said that "reasonableness was not a requirement of the test". But neither at the place indicated by the submission126 nor elsewhere did the High Court explicitly deny what Jacobs and Mason JJA had said. It is true that Barwick CJ, McTiernan, Menzies and Owen JJ stated as a test for fair comment that it be an that on appeal the defendant that case for 124 (1934) 34 SR (NSW) 524 at 532. 125 (1970) 72 SR (NSW) 347 at 361. 126 O'Shaughnessy v Mirror Newspapers Ltd (1970) 125 CLR 166 at 175. "honest expression of opinion ... as an inference open to a fair-minded person"127, without any reference to the adverb "reasonably", but this omission appears to lack significance: there was no specific attack by the Court on Jacobs and Mason JJA's test, there were no submissions from counsel about its correctness, and in the course of argument128 Barwick CJ adopted a similar test in saying that one question was "whether what was said travelled beyond what a reasonable and honest man might in the circumstances have thought or said" (emphasis added). items of allegedly Secondly, an accumulation of inadequate or incompetent work, none of which is said to be a piece of deliberate concealment, is incapable of leading an honest person reasonably – or, for that matter, a fair- minded person acting honestly – to the conclusion that there was deliberate concealment. As indicated earlier129, to reach that conclusion would be a grave result. An honest person acting reasonably, or a fair-minded person acting honestly, would look for more than instances of incompetence, however many there were said to be. These are further reasons for striking out pars 3.1-3.39. Did the Full Court wrongly ask whether the facts pleaded by the defendant were capable of proving the truth of the meaning pleaded by the plaintiff? The defendant submitted, in the words of ground 3.3 of the notice of appeal, that the Full Court erred in holding "that it is necessary that the facts relied upon in support of the comment be capable of supporting the comment in the sense pleaded by the plaintiff and hence address (and, it seems, be capable of establishing as true) the imputation of deliberate concealment of evidence". The defendant argued: "Whereas the particulars of fact pleaded in support of a justification defence must be capable of establishing the truth of the plaintiff's imputation, particulars of fact in a fair comment defence perform an entirely different function. Particulars of fact pleaded in support of a fair comment defence are the facts put forward by the defendant as those upon which the comment was 127 O'Shaughnessy v Mirror Newspapers Ltd (1970) 125 CLR 166 at 176. 128 O'Shaughnessy v Mirror Newspapers Ltd (1970) 125 CLR 166 at 171. 129 See [76]-[78]. based and which are capable of sustaining the comment as objectively fair. There is no occasion for the Court to consider whether those facts are capable of establishing the truth of either the defendant's comment or the plaintiff's imputation." These submissions are based on a misreading of the Full Court's judgment. The Full Court saw the question as being whether the facts pleaded in pars 3.19-3.39 were capable of supporting the fair comment defence130. The Full Court did nothing inconsistent with the propositions of law stated in the defendant's submissions. Pleading deficiencies The plaintiff's notice of contention criticised the form in which pars 3.1- 3.39 were pleaded. Since the conclusions reached above require the striking out of these paragraphs on other grounds, and since the defendant's criticisms of the Full Court's reasoning have been rejected, it is not necessary to consider these arguments. Orders and repleading The Full Court struck out pars 3.18-3.39 of the further amended defence. The reasoning set out above requires the striking out of pars 3.1-3.4 as well, and hence, as a consequence, pars 3.5-3.17. It follows that par 8.1 ("The defendant repeats paragraphs 3.5-3.39 ...") must also be struck out. The same is true of par 8.2 ("The defendant repeats paragraphs 6.1-6.3 ..."), because Master Rice struck out pars 6.1-6.3. However, the defendant submitted that it should have leave to replead the paragraphs struck out – that is, pars 3.1-3.4, 3.5-3.39, 8.1 and 130 Manock v Channel Seven Adelaide Pty Ltd (2006) 95 SASR 462 at 480-481 [43]- [46] per Gray and Layton JJ. 131 The making of this application came about in the following way. As the result of a change in position by the plaintiff, by letter of 26 September 2007 the Registrar requested further submissions from the parties on various questions. One was whether leave should be given to the defendant to replead pars 3.1-3.4, 3.5-3.39, 8.1 and 8.2 if any of them were struck out. On 9 October 2007 the defendant contended that it should have leave to replead unless the defects were incapable of being cured. The warning in the Registrar's letter of 26 September 2007 that the defendant might be deprived of an opportunity to replead pars 3.1-3.4 and any other paragraphs which were struck out led it to advance submissions in support of its being given that opportunity. The defendant's application to replead these paragraphs appears to rest on an assumption shared by many parties to defamation litigation, particularly defendants. That assumption is that proceedings can proceed in very leisurely fashion through every level of appeal in relation to repeated pleading refinements. Quite apart from the excessive consumption of court time which this custom engenders – disproportionate when compared with other forms of litigation – it has the effect of being unfair to the less well-resourced of the two parties, as continual rounds of repleading keep the party which does not want to face trial well away from that ordeal. The assumption ought not to receive any encouragement. The repleading which the defendant now wishes to undertake should have been undertaken at much earlier stages in this litigation. Paragraph 8.2 required attention at least from the time par 6 was struck out by Master Rice. Paragraph 8.1 required attention from the same time, since Master Rice struck out various parts of pars 3.5-3.39. The same is true of pars 3.5-3.39 themselves. The repleading which the defendant wishes to undertake should not be permitted now unless the interests of justice plainly require it. The defendant did not in terms deal with the question whether leave should be granted to replead pars 3.1-3.4 in specific terms, although it did make an application to do so. That application should be rejected. The defects in pars 3.1-3.4 described above132 are incapable of being cured by amendment. Turning to pars 3.5-3.39, they have been exposed to much criticism, and to examination by 10 judicial officers sitting at four levels of appeal, without any concession by the defendant that there is anything wrong with them save in minor respects which have been abandoned. The defects identified in the reasoning set out above in relation to the first five issues are incapable of being cured by further pleading. The defects are more fundamental than the possible defects to which the defendant referred in its submissions as being curable – defects of form and pleading "facts going beyond those sufficiently indicated in the matter". It is therefore not appropriate that the defendant have leave to replead pars 3.5-3.39. The defendant proposes to amend par 8.1 by replacing the existing cross- reference to pars 3.5-3.39 with a full setting out of their text. The defendant pointed out that the cross-reference to pars 3.5-3.39 was not attacked as defective until the matter came before this Court. It also pointed out that even if those paragraphs did not support a defence of fair comment, it did not follow that they could not support the defence of extended qualified privilege. It submitted that pars 3.5-3.17, taken with pars 8.2-8.9, sufficiently pleaded "the government and political matter" relied on to establish the occasion of privilege. And it submitted that pars 3.19-3.39 were "maintainable as an articulation ... of the particular aspects of the forensic investigation and evidence which the [defendant] says either have been, or are worthy of being, the subject of the public and political debate and discussion referred to in [pars 3.13-3.17 and 8.3-8.9]". Whatever the adequacy of pars 8.3-8.9, these two submissions must be rejected. None of the matters alleged in pars 3.5-3.39 are referred to in the relevant publication – the promotion. Hence they cannot be said to be particulars of the allegation in par 8 that the promotion "constituted the discussion of government and political matters". A publication cannot be said to discuss government and political matters if it does not refer to them. Further, the matters which are said to have made up the "discussion" which the promotion is alleged to have constituted, according to pars 3.5-3.39, do not relate to the imputation that the plaintiff had deliberately concealed evidence: a discussion about supposedly incompetent investigation and testimony is not a discussion about deliberately concealed evidence. It follows that there should be no leave to replead in relation to par 8.1. Finally, turning to par 8.2, the defendant noted that it had not been attacked before the present appeal. It noted that pars 6.1-6.3 "pleaded an impaired reputation on the part of the [plaintiff] by reason of errors made by the [plaintiff] in his role as Senior Director of Forensic Pathology at the State Forensic Science Centre, the publicity given to those errors, and other public allegations about the [plaintiff]". It submitted that the object of par 8.2, in picking up pars 6.1-6.3, was to assert that deficiencies in the plaintiff's conduct as Senior Director, including his conduct in respect of the Keogh prosecution, had become a source of significant public concern and debate, with the result that his conduct had become a matter of significance in the politics and government of South Australia, justifying the discussion (and proposed discussion) in the defendant's broadcast. These submissions must be rejected. The defendant did accept that par 8.2 so far as it incorporates pars 6.1-6.3 "might be better pleaded". But the defendant wanted to replead along the lines of pars 6.1-6.3. The plea of bad reputation made in these paragraphs is in this case irrelevant to qualified privilege. Further, the matters referred to in pars 6.1-6.3 are not referred to in the promotion, and are incapable of constituting particulars of an allegation that it "constituted the discussion of government and political matters". In addition, like pars 3.5-3.39, which to some degree pars 6.1-6.3 resemble, they pose issues about the plaintiff's competence, but say nothing relevant to an allegation that he deliberately concealed evidence. The appropriate orders are: (1) Appeal dismissed; Special leave to cross-appeal be granted and the cross-appeal be treated as instituted, heard instanter and allowed; Set aside orders 2-5 of the Full Court of the Supreme Court of South Australia made on 18 October 2006 and, in their place, order that paragraphs 3.1-3.39, 8.1 and 8.2 of the further amended defence be struck out; and The appellant pay the respondent's costs of the appeal and the cross- appeal. Kirby 103 KIRBY J. Justice David Ipp has described defamation as the "Galapagos Islands Division" of the Australian law of torts133. He has explained how the tort of defamation has "evolved all on its own" and "created legal forms and practices unknown anywhere else". His sharpest comments were reserved for the subject matter of this appeal134: "Pleadings in defamation actions are as complex, as pedantic and as technical as anything known to Dickens135. Interlocutory disputes continue to beset plaintiffs and there are often massive delays in getting defamation cases to trial." Seventeen years earlier I described the same features of defamation practice as "unduly and unnecessarily complex"136. I expressed regret for the "excess of refinement"137 that "ensnare[s] plaintiffs unjustly in burdensome, costly and dilatory pleading disputes"138 when the preferable course would normally be to get the litigation as quickly as possible before the tribunal of fact "for a robust and commonsense decision that will reflect the general merits of the case"139. I continue to hold these opinions. I have repeated them in this Court140. Similar issues now arise, not out of the defamatory imputations alleged by a plaintiff (as in the foregoing cases), but from the defendant's defence of fair comment. The boot is therefore on the other foot. Nevertheless, in the dying hours of the common law of defamation in Australia, specifically as applicable to statements published in the State of South Australia before the Uniform 133 Ipp, "Themes in the law of torts", (2007) 81 Australian Law Journal 609 at 615. 134 (2007) 81 Australian Law Journal 609 at 615. 135 See Burrows v Knightley (1987) 10 NSWLR 651 at 654 per Hunt J. 136 Drummoyne Municipal Council v Australian Broadcasting Corporation (1990) 21 NSWLR 135 at 149. 137 (1990) 21 NSWLR 135 at 151. 138 (1990) 21 NSWLR 135 at 151. 139 (1990) 21 NSWLR 135 at 151. See also Kenyon, Defamation: Comparative Law and Practice, (2006). 140 Chakravarti v Advertiser Newspapers Ltd (1998) 193 CLR 519 at 578 [139]; Favell v Queensland Newspapers Pty Ltd (2005) 79 ALJR 1716 at 1721-1722 [20]- [22]; 221 ALR 186 at 192-193. Kirby Defamation Acts141 commenced operation, it would be desirable for this Court, so far as it can, to uphold sensible procedures and to discourage rulings that impede the prompt, just and lawful resolution of such claims. Where possible, such disputes should be resolved at trial, rather than in interlocutory skirmishes, of which these proceedings are but the latest unhappy illustration. The proceedings, issues, concurrence and disagreement The joint reasons: Before this Court are an appeal and cross-appeal from a judgment of the Full Court of the Supreme Court of South Australia142. The reasons of Gummow, Hayne and Heydon JJ ("the joint reasons") describe the factual and procedural background143. They also describe the appeal, notice of contention and cross-appeal in this Court144. They identify the issues requiring decision145. One has only to reflect on the course of the litigation, concerning a television broadcast that went to air nearly four years ago, and the different opinions of so many judicial officers, at four levels in the courts, before any trial is had of the merits, to realise how destructive of the utility of the cause of action is this form of interlocutory litigation. If such pleading skirmishes are suitable for review by a final national court, this can only be because considerations of principle are presented for decision. As matters transpire, there are three such considerations. The resulting issues: I will follow the style of reference to the parties and the issues contained in the joint reasons. Thus, the issues for decision in the proceedings are: The comment or fact issue146; 141 Defamation Act 2005 (SA). The Uniform Defamation Acts have been enacted in each of the jurisdictions of the Commonwealth; cf George, Defamation Law in Australia, (2006) at 96-97. 142 Manock v Channel Seven Adelaide Pty Ltd (2006) 95 SASR 462. 143 Joint reasons at [14]-[27]. 144 Joint reasons at [28]-[30]. 145 Joint reasons at [31]. 146 Joint reasons at [33]-[44]. Kirby The sufficient identification of facts issue147; The correlative meanings issue148; The deliberate concealment issue149; The response to the plaintiff's meaning issue150; The residual pleading deficiencies issue151; and The consequential orders issue152. Issues of concurrence: Upon the premises on which they proceed, I agree with the substance of the joint reasons in their treatment of the issues numbered (3), (4), (5) and (6). However, I agree in part only with the resolution of issue (1). If that had been the full extent of my disagreement, I would, in all probability, have considered whether such substantial concurrence would be enough to join the joint reasons, given the other alternative pathways that they provide for coming to the conclusions that they reach. But there is more. Disagreement and orders: The centrepiece of the joint reasons is a detailed analysis, comprising almost half of their length, concerning the requirement that, to be entitled to avail itself of the defence of fair comment, the defendant must, in the matter complained of, sufficiently identify the facts upon which the comment is alleged to be based. The defendant must do so either by stating those facts in appropriate detail or by making adequate reference to them, or it must refer to facts that are so notorious that they do not require explicit elaboration. As this issue is explained, I disagree with the analysis in the joint reasons153. I therefore disagree with the conclusion that, on this basis, pars 3.1- 3.39 of the further amended defence154 ("the defence") should be struck out. 147 Joint reasons at [45]-[75]. 148 Joint reasons at [76]-[87]. 149 Joint reasons at [88]-[92]. 150 Joint reasons at [93]-[94]. 151 Joint reasons at [95]. 152 Joint reasons at [96]-[102]. 153 Joint reasons at [45]-[75]. 154 Set out in the joint reasons at [22]. Kirby Having come to different conclusions upon two lines of reasoning that support the outcome favoured in the joint reasons, it is necessary for me to address the orders that would be appropriate to dispose of the defendant's appeal and of the plaintiff's cross-appeal (and notice of contention). Because my opinion is a minority one, and because it partly follows the earlier reasoning of McHugh J in Pervan v North Queensland Newspaper Co Ltd155, I must explain my reasons and the slightly different orders to which they lead me. Recognisable comment or fact? Classification of statements: The first pathway provided by the joint reasons to their conclusion, adverse to the defendant, is the opinion that none of the statements in pars 3.1-3.4 of the defence156 constitute "comment". On that basis, upholding an argument advanced by the plaintiff in his cross-appeal, but not propounded by him in the Full Court157, the joint reasons conclude that none of the core statements in the matter complained of constitute "comment". Accordingly, by definition, they cannot be "fair comment", protected by the common law. To be defensible, they must rely on other grounds of defence, if available, such as justification or privilege. It is on the basis that the statements pleaded in pars 3.1-3.4 were statements of fact and not comment that the joint reasons conclude that those grounds of defence should be struck out. Because the remaining allegations, relied on in pars 3.5-3.39, are supportive of (and dependent on) the statements pleaded in pars 3.1-3.4, this conclusion leads the joint reasons to an outcome that the entire defence of fair comment in par 3 of the defence must be rejected. The joint reasons observe that the answer to the first issue "constitutes an independent reason for the conclusion that the appeal must be dismissed and the cross-appeal allowed"158. Bulwark of free speech: The defence of fair comment is extremely important to the exercise of free expression in Australia. It has been rightly described as "the bulwark of free speech in the law of defamation"159. In effect, it 155 (1993) 178 CLR 309 at 340-351. 156 Set out in the joint reasons at [22]. 157 Joint reasons at [26]-[27]. 158 Joint reasons at [32]. 159 Sutherland, "Fair Comment by the House of Lords?", (1992) 55 Modern Law Review 278 at 278; cf Rares, "No Comment: The Lost Defence", (2002) 76 (Footnote continues on next page) Kirby allows everyone to express opinions, so long as the necessary legal preconditions are met. Those preconditions do not distinguish between orthodox and heterodox comments; majority and minority comments; popular and unpopular, "moral" and "immoral", respectful and disrespectful comments. This Court should not take a narrow view of what constitutes a "comment", for the purpose of attracting the fair comment defence. It has not done so in the past160. To the extent that it takes a narrow view, it will place an unwarranted restriction on the availability of the defence of fair comment. It will thereby impose unjustified restrictions upon freedom of discussion and the expression of opinions in our community. It is by freedom of discussion, including the expression of unorthodox, heretical, unpopular and unsettling opinions, that progress is often made in political, economic, social and scientific thinking. Courts have to give more than lip-service to free expression, including in the making of protected comment, lest legal protection for comment on a matter of public importance becomes illusory or non-existent from a practical point of view161. It is by the public expression of diverse opinions, expressed as comment, that our form of society is distinguished from others which enjoy a lesser freedom162. I accept that a price has to be paid for the defence of fair comment. Some comment is intensely hurtful, unreasonable and unjust. Publishers of mass media, such as the defendant, enjoy great power to harm reputation and manipulate public perceptions, including by published comments. One way of doing so (more common today than in the past) is by mixing fact and opinion in Australian Law Journal 761 at 773-774; Kenyon, "Defamation, Artistic Criticism and Fair Comment", (1996) 18 Sydney Law Review 193 at 213-216. See also reasons of Gleeson CJ at [3]. 160 Pervan (1993) 178 CLR 309 at 317-318 per Mason CJ, Brennan, Deane, Dawson, Toohey and Gaudron JJ, 333 per McHugh J. On this issue in Pervan, the Court was unanimous. 161 See Pervan (1993) 178 CLR 309 at 328; Slim v Daily Telegraph Ltd [1968] 2 QB 157 at 170; Telnikoff v Matusevitch [1992] 2 AC 343 at 361 per Lord Ackner (diss). 162 For example, it was the persistently expressed belief in Mr Andrew Mallard by his family and supporters and critical media comment on the proceedings leading to his conviction of murder that eventually led to a second challenge to that conviction before this Court. Orders quashing his conviction were followed by acceptance that he was in fact innocent and by an inquiry into the circumstances of his conviction. See Mallard v The Queen (2005) 224 CLR 125. Kirby the presentation of "news". This is why some limitations on the ambit of the fair comment defence are necessary in the law. It is why the ambit of fair comment involves a threshold differentiation between what is classified as a "fact" and what is classified as a "comment". Point of distinction: No clear line can be drawn between a "comment" and a statement of "fact". No single differentiating test can be propounded as a universal rule. Great care must therefore be taken at the interlocutory stage of a defamation action in classifying hurtful, opinionative statements as statements of fact rather than comment. It is not quite correct to describe the classification as "a matter for the discretion of the judge"163. It is, however, certainly a matter calling for judgment and evaluation on the part of the judge. Part of the process of judgment and evaluation involves a recognition of the great importance which the defence of fair comment affords to the enjoyment of comparatively free expression of opinions in Australia. Exclusion of the defence of fair comment at an interlocutory stage, in advance of a trial on the merits (and more especially, as now proposed, its complete exclusion from the trial164), is a most serious step. It deprives a defendant of a most important defence. It is a defence especially significant for a publisher and broadcaster, like the defendant, operating in the public media. It requires a very clear case to warrant sending such a defendant to trial without the opportunity of argument based on that defence. Loss of the defence might happen at trial, when the merits of the case are before the tribunal of fact (judge or jury). That is one thing. Pre- trial exclusion of the defence, effectively as unarguable, is quite another. Recognisable comment: Are any of the matters pleaded by the defendant in pars 3.1, 3.2, 3.3 or 3.4 arguably recognisable as comments? Or are all of them (as the joint reasons hold) statements of fact? I will assume, as the joint reasons do, that par 3.1, with its reference to "the new Keogh facts", constitutes, on its own, a statement of fact and not a comment165. The words are the defendant's. They are not hedged about with protective indicia of comment such as "in our opinion", or "in other words", or "we would say", or "Channel Seven believes"166. 163 cf joint reasons at [33] citing Favell (2005) 79 ALJR 1716 at 1719 [6]; 221 ALR 164 Joint reasons at [98]-[99]. 165 Joint reasons at [38]. 166 cf George, Defamation Law in Australia, (2006) at 340. Kirby While it is possible that the word "new" connotes the broadcaster's differentiation between "facts" earlier presented in evidence at Mr Keogh's trial for murder and facts that are "fresh" and "different" in the sense of recently discovered, I would not dissent from the view of my colleagues that par 3.1 is simply a statement of fact. Paragraph 3.1 of the defence is thus susceptible to the strike-out order favoured in the joint reasons. When, however, I pass beyond par 3.1, the characterisation of the statements as "fact" is much more contentious. It is a basic mistake to divorce the impugned words, as they appear in the matter complained of, from the context in which they appear. That context was a brief promotional broadcast published by a commercial television broadcaster to a mass audience. The broadcast was one aimed at attracting as many viewers as possible, who saw the promotion, to view and listen to the advertised broadcast. The whole point of the promotion was to encourage the greatest possible attention to the entire programme. The defendant is not, was not pretending to be, and would not be seen by the vast majority of its audience as, an authoritative public tribunal for determining guilt or innocence, propriety or wrong-doing. On the return of the plaintiff's action at trial, it is at least arguable that the tribunal of fact could conclude that the ordinary, reasonable viewer, watching the promotion, would conclude that statements made there were nothing more than comments by the broadcaster. In short, the promotion, arguably, did nothing but indicate to those who saw it that, at the advertised time, they would have the opportunity of viewing and hearing a description of facts and statements of opinion, advanced by or for the defendant, concerning the Keogh case and the role in it of the (pictured) plaintiff. The promotion arguably offered comment on the promised "new Keogh facts" (which, by inference, the plaintiff should have disclosed to authorities but which had been "kept to themselves" (par 3.2)); that data, dates and documents "don't add up" (par 3.3); and that evidence called before the earlier courts was "changed from one Court to the next" (par 3.4). All of these appear to be recognisable as comments, ie remarks, observations or criticisms by the defendant, support for which was promised in the advertised programme. Opinions, conclusions and criticisms: Given that, self-evidently, the defendant had no authority to decide any such matters conclusively, it is impossible to say that the statements pleaded in pars 3.2-3.4 of the defence were pure statements of fact. To the contrary, they appear as opinions in the form of conclusions or criticisms, based on foreshadowed facts. As such, they arguably Kirby amount to comments, for which the fair comment defence was available in law, and not facts, for which it was not167. Revealed in the analysis in the joint reasons is the danger of taking each of the impugned paragraphs separately and out of the context in which the matter complained of was published. Promotions and advertisements, especially on Australian commercial television, are generally received by those who view and hear them for what they purport to be – attempts to attract a large viewing audience with the aim of increasing advertising revenue and thereby generating profits for the broadcaster's shareholders. Entertainment, personality, sensation, opinions and comment are commonly the means by which such profits are maximised. Sometimes, incidentally, larger causes are advanced. But, for the most part, material such as that in pars 3.2-3.4 may be characterised as promotional "comment". To exclude the fair comment defence, plaintiffs may be able to demonstrate that the comment does not relate to a matter of public interest168, a classification which, at common law, the judge rather than the jury had to make169. Or the publication may be contested on the basis that the comment was not fair, in the sense of not being the defendant's honest opinion170. Or it may not be based on facts that are sufficiently indicated within the rule to which I will next turn. Or the plaintiff may be able to establish that, although the statements were comment, they were denied the fair comment defence because they were affected by malice171. However, to classify pars 3.2-3.4 as pure statements of fact and not comment, and to deprive the defendant of the fair comment defence in advance of the trial on that basis, is in my opinion wrong. Such a classification takes the words and images out of context. It divorces them from the character of a promotional broadcast on commercial television. It overlooks their object and purpose. And it seriously diminishes the availability of the fair comment defence in a way that is unjustifiable and undesirable. 167 See George, Defamation Law in Australia, (2006) at 345. 168 Pervan (1993) 178 CLR 309 at 317 per Mason CJ, Brennan, Deane, Dawson, 169 Bellino v Australian Broadcasting Corporation (1996) 185 CLR 183 at 191; Henwood v Harrison (1872) LR 7 CP 606 at 628. 170 Falcke v The Herald and Weekly Times Ltd [1925] VLR 56 at 69-75; Bickel v John Fairfax & Sons Ltd [1981] 2 NSWLR 474 at 487, 498. 171 Pervan (1993) 178 CLR 309 at 329; Davis v Shepstone (1886) 11 App Cas 187. Kirby Outcome: comments not facts: The first thoughts of the plaintiff, before the Full Court, were therefore correct. In a full hearing on the merits at trial, the defendant might fail in its fair comment defence. In South Australia, that trial would take place before a judge sitting alone and not with a jury172. Nevertheless, the interlocutory argument on the availability of the defence proceeded in the same way as it would in those jurisdictions of Australia that have hitherto preserved different modes of jury trial for the determination of some or all of the factual issues arising in such trials. It follows that the first argument advanced for the plaintiff in his cross- appeal should be rejected. The contrary opinion expressed in the joint reasons rests on a differentiation between "fact" and "comment" that would seriously reduce the availability and utility of the fair comment defence to the public media in Australia. This is not a step that this Court has previously taken. It is not one that I would take now. It is a step that has the potential to erode free expression. Our society is strong and vibrant enough for, and often benefits from, the robust expression of opinions. The reference to the factual basis for a comment Sufficient indication of factual basis: An even more serious limitation on the availability of the fair comment defence to media organisations such as the defendant is the conclusion, expressed in the joint reasons, that the facts, on which the comment was based, must be sufficiently indicated at the time of the publication of the matter complained of. It was not contested that the general test to be applied was that propounded in the joint majority reasons in Pervan173: "[T]he facts on which the comment is based [must be] sufficiently indicated or notorious to enable persons to whom the defamatory matter is published to judge for themselves how far the opinion expressed in the comment is well founded." Self-evidently, if the facts are "sufficiently indicated" by setting them out in the matter complained of or if, in the particular circumstances concerning the 172 The position in Australia in relation to jury trials before and after the Uniform Defamation Acts 2005 is explained in George, Defamation Law in Australia, 173 (1993) 178 CLR 309 at 327 (footnote omitted). Kirby plaintiff, they are notorious, no issue for striking out the defence of fair comment on this basis will arise. The defence will go to trial. The defendant did not contend that the comment relating to the plaintiff concerned notorious facts. Having regard to its assertion in the promotion of "new … facts", such a contention would have been unpersuasive. Similarly, because of the brevity of the promotion, it was not submitted that the factual material on which the posited comment was made appeared, in terms, in the publication complained of. In the nature of a promotional broadcast, such could scarcely ever be the case. The question for decision by this Court is therefore whether, by reference to any earlier binding or persuasive authority, a narrow or broad view should be taken of what is meant by the requirement of sufficient "indication" of the facts for the purpose of attracting the common law defence of fair comment. Use of foreign judicial authority: The joint reasons approach the resolution of this question as if it can be decided entirely divorced from what those reasons disparagingly describe as "policy-based and potentially radical submissions"174. However, such remarks address what seem to me to be the wholly orthodox and unremarkable submissions of the defendant. The defendant argued that, in resolving this issue in the present appeal, it would be necessary to give weight to society's interest in "encouraging free discourse through the expression of opinion". When there is no clearly applicable earlier determination of a legal issue in Australia, in reasoning expressed by a majority of this Court addressed to the same legal question as in the case at hand, this Court will derive a new or elaborated principle by analogical reasoning from earlier authority. Such earlier authority will, primarily, be this Court's own decisions. In common law cases, they may be supplemented, where appropriate, by reference to the reasoning of the Privy Council, particularly in the period when it was the ultimate appellate court of Australia; to the reasons of English courts of high authority; and (where relevant) to reasoning in decisions of other foreign courts grappling with the same or similar problems175. However, no decision of any court of a foreign country is any longer binding in Australia as a matter of law. 174 Joint reasons at [63]. 175 Viro v The Queen (1978) 141 CLR 88; cf Commissioner of Stamp Duties (NSW) v Pearse (1953) 89 CLR 51; Skelton v Collins (1966) 115 CLR 94; Public Transport Commission (NSW) v J Murray-More (NSW) Pty Ltd (1975) 132 CLR 336; Cook v Cook (1986) 162 CLR 376. Kirby We look to the reasons of foreign courts for the assistance that they may provide for the ascertainment of the content of the Australian common law. It is especially relevant to consider foreign decisional law in cases where Australian constitutional176 or statutory law177 has copied the law of foreign nations. But it is a mistake to treat overseas judicial observations on the common law as if they conclusively state the common law of this country, with its distinctive legal and social characteristics. It is an even more serious mistake to select passages from earlier opinions in overseas courts, and to analyse them textually as if, ipsissima verba, they represent a statement of the contemporary common law of Australia. Worst of all is it a mistake to treat words in judicial speeches of the House of Lords, which was never part of the Australian judicial hierarchy, as affording, statute-like, an authoritative statement of the ambit of the fair comment defence provided by the common law of Australia to allegedly defamatory matter published in this country. With respect, these appear to me to be the mistakes that have occurred in the central part of the joint reasons. They include a close textual examination of the 1952 House of Lords decision in Kemsley v Foot178, including the passage in Lord Porter's leading speech in that decision which endorsed a quotation from the 1929 sixth edition of the English text Odgers on Libel and Slander179. Decision in Pervan's case: Much attention is then given by the joint reasons to the current state of English authority180 and to the opinion of Lord Nicholls of Birkenhead, expressed in the Hong Kong Court of Final Appeal181. 176 See eg D'Emden v Pedder (1904) 1 CLR 91; Ex parte Nelson [No 2] (1929) 42 CLR 258 at 263 per Isaacs J; Huddart Parker Ltd v The Commonwealth (1931) 44 CLR 492 at 524-526 per Evatt J; Australian Coastal Shipping Commission v O'Reilly (1962) 107 CLR 46 at 55-56 per Dixon CJ, 66 per Menzies J. 177 Coventry v Charter Pacific Corporation Ltd (2005) 227 CLR 234; Central Bayside General Practice Association Ltd v Commissioner of State Revenue (2006) 228 CLR 168 at 198-200 [85]-[90]; Cornwell v The Queen (2007) 81 ALJR 840 at 848- 853 [32]-[54], cf at 870-871 [134]-[137]; 234 ALR 51 at 61-69, 92-93. 178 [1952] AC 345. See joint reasons at [48]. 179 6th ed (1929) at 166-167, quoted in Kemsley [1952] AC 345 at 356-357. 180 Joint reasons at [52]-[55]; cf Telnikoff [1992] 2 AC 343 at 361; Reynolds v Times Newspapers Ltd [2001] 2 AC 127 at 201; Lowe v Associated Newspapers Ltd [2007] QB 580 at 588-600 [21]-[60]. 181 Cheng v Tse Wai Chun (2000) 3 HKCFAR 339 at 347. See the joint reasons at Kirby Ultimately, the joint reasons accept, as they were bound to, that this Court must find the rule applicable to the present case in its own earlier authority. They nominate Pervan182. However, when Pervan is properly analysed, it can be demonstrated that neither the joint reasons in that case, nor any other decision of this or another Australian court, answer the exact problem now presented for our decision. Pervan was a case concerned not with the common law of defamation but with the enacted provisions of s 377 of the Criminal Code (Q). Section 377(8) of that Code provided that there was a "lawful excuse for the publication of defamatory matter" if the publication was "made in good faith in the course of, or for the purposes of, the discussion of some subject of public interest, the public discussion of which is for the public benefit, and if, so far as the defamatory matter consists of comment, the comment is fair". The reference in the first part of the enacted Queensland defence to the requirement that the relevant discussion must be "for the public benefit" has never been part of the common law. In particular, it has never been part of the law of South Australia. Necessarily, in deciding Pervan, this Court was therefore concerned not with the common law of Australia but with the meaning of the defence provided in the Queensland Code. The primary holding in Pervan was that s 377(8) of the Code did not import a requirement that the "comment", upon which the defendant relied, had to be based on facts which were true. Nor did s 377(8) require that the publisher hold the opinion expressed in the defamatory publication. Such were the issues in that case. The publication sued upon in Pervan was an advertisement in a regional newspaper. The advertisement, in the public notices section of the newspaper, summoned a meeting of ratepayers. The notice repeated statements made originally under privilege in the Queensland Parliament183. Factual circumstances more different from the present case would be difficult to imagine. Pervan addressed a statute not the common law. It related to a defence of fair comment expressed in distinctive terms in a particular setting. It concerned a publication in a regional newspaper, not a broadcast on a commercial television station. And the publication appeared in a notice in permanent printed form, not a brief broadcast of a promotional advertisement. To conclude that, for the defendant to succeed in invoking a defence of fair comment in the circumstances of the present case, it must persuade this 182 See joint reasons at [72]. 183 Pervan (1993) 178 CLR 309 at 331-332. Kirby Court to overrule a legal principle for which Pervan stands (as the joint reasons suggest184) mis-states the requirement of the Australia law of precedent185. Although due respect will be paid to judicial observations, as a matter of law, only the ratio decidendi is binding. The ratio decidendi of Pervan is, as I have demonstrated, far removed from the legal question in issue in this appeal. That question is, relevantly, whether, in a publication such as the words and images broadcast by the defendant in the promotion, the facts in respect of which the defence of fair comment was claimed were sufficiently "indicated". Was this achieved by identifying the time and place where, very soon afterwards and conveniently, those who wished to receive the promised facts could do so, in order to decide for themselves whether such comment was, or was not, "fair" in the legal sense? Or was this "identification" insufficient to meet the common law requirement? Considering concepts not words: To attempt to draw from the judicial dicta in Pervan a legal rule binding in the present case is to fall into an error quite frequent in common law reasoning. It is to perceive legal rules as inextricably related to particular evidentiary facts rather than as endeavours to express a general legal principle, albeit in the context of particular facts. The general principle that emerges from the case law governing the defence of fair comment at common law is that, to be "fair" in the legal sense, a "comment" must sufficiently identify the facts on which it is based so that the recipient of the publication may form his or her own view about the comment. The relevant facts may be identified in one of three ways: Sometimes, the relevant facts will be identified in the publication itself; Sometimes, although referred to, they will not be elaborated because they are notorious. As such, they will be known both to the publisher and the recipient; and Sometimes, whilst neither stated nor notorious, they may be "identified" or "referred to" adequately, so as to enliven the fair comment defence. The question in this appeal is whether the present facts and circumstances fall within this third category. That question is not answered by invoking the words used in Pervan. Still less is the question decided authoritatively or conclusively by any earlier decision. 184 Joint reasons at [63]. 185 See Garcia v National Australia Bank Ltd (1998) 194 CLR 395 at 417-418 [56]. Kirby Test of sufficient identification: For these reasons, I disagree with the analysis on this point, contained in the joint reasons. In his minority reasons in Pervan, McHugh J correctly recognised that the defence of fair comment was available at common law beyond circumstances where the comment was based on facts themselves published in the matter complained of186. Clearly, in Pervan, McHugh J was not postulating a particular legal subcategory of cases "where a play or sporting spectacle is being reviewed"187. I deprecate reasoning in such tiny subcategories, based on no more than factual illustrations afforded by earlier judicial reasons188. Such an approach was expressly disclaimed by McHugh J in Pervan189. Indeed, his Honour was seeking to express a conceptual category, necessarily larger than one confined to plays or sporting spectacles. The concept that he described was conformable with the legal concept apparent in earlier cases, even if (for the most part) it had not required elaboration there, as it does here. As McHugh J put it190: "To raise the defence of fair comment in this class of case ['based on facts which are not published in the article'], it is sufficient that either expressly or by implication the defendant has identified the subject matter of the comment … As long as the subject matter of the comment is identified, the defendant is entitled to the benefit of the defence of fair comment if he or she is able to prove one or more facts which will justify the comment." In support of this proposition addressed to the underlying legal concept, McHugh J referred to passages in the reasoning in Kemsley191. Given that the legal issues under consideration in Pervan were significantly different from those now presented in this appeal, it is distracting to debate (as the joint reasons do192) whether counsel's arguments in Pervan contain 186 (1993) 178 CLR 309 at 335 ("comment … based on defamatory facts that are published with the comment"), 336 ("based on non-defamatory facts which are published with the comment"), 340 ("based on facts which are not published in the article"). 187 (1993) 178 CLR 309 at 340. 188 See joint reasons at [70]. 189 (1993) 178 CLR 309 at 340 ("it is certainly not limited to plays or spectacles"). 190 (1993) 178 CLR 309 at 340 (emphasis added, footnote omitted). 191 [1952] AC 345 at 358, 362. 192 Joint reasons at [61]. Kirby no reference to Kemsley. That is entirely irrelevant to the task that this Court now faces. In Pervan, the joint reasons193, as well as those of McHugh J, refer to Kemsley. The speeches in Kemsley, so far as they describe a "substratum of facts" required to provide the recipient of a publication with sufficient facts to judge the "fairness" of a comment, are useful. However, they are useful only as illustrations of the way, historically, the common law principles have evolved. In this appeal, this Court reaches a point in the elaboration of decisional law where there is a need for a new and different expression of the old principles. We may look to the matters of history in the hope that, so assisted, we will develop any new principles by analogical reasoning so that they fit comfortably into the surrounding body of the common law. But we deceive ourselves, and mistake the judicial process in which we are engaged, if we pretend that the governing legal rule exists, fully formed, in the remarks written by judges in earlier cases. Inescapability of legal policy: Unpleasant, therefore, as the joint reasons appear to have considered the need to evaluate questions of legal policy194, it is my respectful view that attempts to resolve the problem presented, solely by the invocation of obiter dicta in Pervan or other earlier cases, divorced from legal policy and principle, are doomed to fail. This is so because, when the judges wrote Kemsley, Pervan and the other decisions cited in this appeal, none of them had under consideration a problem precisely like the one that this Court now faces. When the sixth edition of Odgers (approved in Kemsley) was published in 1929, television was in the earliest stages of its development. John Logie Baird had only recently (in 1926) demonstrated the first system that would be refined into what we now know as television195. Even when Kemsley was decided in 1952, mass audience television was still rudimentary. Pervan itself was not addressed to the availability of the common law defence of fair comment to a brief television promotion. The case concerned the print media. In judging whether the defence of fair comment may be available to such a broadcast, this Court deludes itself if it considers that the answer is to be extracted directly from judicial remarks addressed in a different time, to a different technology, presenting different legal problems. 193 (1993) 178 CLR 309 at 317, 327. 194 Joint reasons at [63]. 195 "Baird, John Logie", in Encarta World English Dictionary, (1999) at 134. Kirby I accept that weighing the considerations of legal policy at stake in an appeal such as this is not a simple task. However, we needlessly complicate this Court's function by pretending that there is a clearly applicable common law rule. Or by protesting that it should be derived in a policy-free zone. It is equally clearly the case that mixing fact and comment can involve serious risks of abuse of the power of publishers such as the defendant. Keeping comment separate from the purported presentation of facts enhances the proper evaluation of the comment by its recipients. It avoids the usurpation or attempted usurpation of evaluation. Likewise, demanding that sufficient facts must be stated (or be notorious or adequately identified) contemporaneously with the publication of the comment enhances the recipient's capacity to perceive the comment for what it is, to evaluate it and to reach conclusions about it. Relevant changes in technology: The technology of communications has advanced greatly since the early cases on the fair comment defence were decided. Because that defence is very important to the maintenance of free expression in Australian society, it is essential that the understanding of the ambit of the defence at common law should keep pace with (and be relevant to) the new technology by which comment is now often published. That new technology includes television, notably commercial television in which every minute of broadcasting time is extremely valuable. The value of air time results in highly abbreviated communications. They may contain, at once, the publication of useful facts, fair comment and material damaging to honour and reputation. If, to attract a defence of fair comment, it were a requirement of the common law of Australia that a promotion measured in seconds had to contain all relevant facts that a recipient would need to judge the "fairness" of the comment, self-evidently this would destroy the practical availability of that defence for many such publications. Unless some abbreviated identification of notorious facts were adequate to the circumstances, the brevity of the promotion would effectively render the contemporaneous presentation of the relevant facts impossible. Nor is the problem so presented confined to promotional broadcasts on television. Many of the new electronic technologies by which publications are now made (email, text message, interactive internet exchanges etc) place a high premium on brevity. Is the common law defence of fair comment to be expelled from application to publications using these new technologies simply because the message itself does not elaborate the facts upon which the publisher relied to sustain the "fairness" of the comment? These are not esoteric questions. They may affect the survival of the fair comment defence as relevant to the electronic media by which the majority of businesses and individuals in Australia communicate today. In expressing the content of the fair comment defence for the present case, and reaching into legal Kirby writings that preceded the contemporary technology, this Court should spare a thought for the significance of what it now decides for other forms of electronic publication, beyond that presently in issue. These reasons demonstrate why it is a mistake simply to apply earlier dicta on the common law, addressed almost exclusively to print media, without adequate analysis of the basic legal concept in issue and without appropriate consideration of the changing technology of communications in respect of which the defence of fair comment will be invoked. Specification of available facts: In the present appeal, the recipient of the matter complained of in the promotional broadcast was arguably afforded an adequate specification of where and when the facts relied on by the commentator could be found. The recipient was told how, without undue inconvenience or delay, he or she might obtain those facts. This was indeed encouraged by the publisher. In such circumstances, in my view, it would be open to the trier of fact to conclude that the facts were sufficiently "identified" in the promotion, in order to attract the fair comment defence. If such an approach is not taken to the availability of the defence under the common law of Australia, this Court must face the consequence that, in many media, its decision will effectively abolish or greatly confine the defence at common law and any statutory equivalents that are held to import the common law requirements. Because of the significance of the fair comment defence for free expression in Australia, this is a step I would not take. Some recipients of communications in the form of the defendant's promotion would not watch the promoted programme. Some would therefore not receive the "new … facts" at all or receive them in their entirety196. Some would form their own opinions about the plaintiff solely on the comment contained in the promotion. Those who did not watch the full programme (or some of them) might derive, or retain, from the promotional broadcast adverse conclusions about the plaintiff. In determining the ambit of the fair comment defence at common law, weight must be given to the cases where the foundation (if any) for the comment fails to catch up with the damage occasioned by the abbreviated broadcast. On the other hand, effectively to withdraw the fair comment defence from all such abbreviated communications would, potentially, be such a serious erosion of free expression, specifically of opinions, that this Court should reject it as a universal rule. A viewer watching a promotion such as that complained of on a commercial television broadcast could be expected to retain a degree of scepticism about such promotions in general and any comments contained within 196 cf reasons of Gleeson CJ at [10]-[11]. Kirby them, in particular. In the circumstances of abbreviated electronic publications, it is therefore not unreasonable to treat as sufficiently "identified" facts that are referred to in the matter complained of which the recipient can conveniently and with reasonable promptness access. Such a principle would apply fairly to the extended television programme referred to in the defendant's promotion. It would also apply fairly to facts conveniently and readily accessible in interactive forms of electronic communication for which, likewise, the fair comment defence continues to play an important role in protecting free expression. Conclusion: adequate identification: When, in the present proceedings, the foregoing approach is taken to the problem presented, the answer to the second issue is clear. Although the publication, in what I would hold to be the defendant's comments broadcast in the promotion, did not itself contain all of the facts necessary to allow the recipient to evaluate the comment being made (communication of all such facts being impossible in that type of publication), the facts relied on were sufficiently "identified". They were adequately "referred to". The recipients were told when and where such facts would be available. If they were interested they could conveniently, promptly and without cost have secured access to those facts. That is arguably enough to attract the fair comment defence. No legal authority in this Court requires a conclusion different from the one that I favour197. Nor does legal authority persuasively suggest a contrary result198. Relevant considerations of legal policy and legal principle support this adaptation and extension of earlier expositions of the common law defence of fair comment. Most such expositions were written before the advent of modern telecommunications. They were stated without consideration of the impact 197 The closest analogy is the consideration of defamatory headlines in Smith's Newspapers Ltd v Becker (1932) 47 CLR 279 at 303-304 per Evatt J. 198 See A S Abell Co v Kirby 176 A 2d 340 at 348 (1961), where the Court of Appeals of Maryland acknowledged the possibility of incorporation of facts by reference. See also Fisher v Washington Post Co 212 A 2d 335 at 338 (1965) where the District of Columbia Court of Appeals concluded that it was sufficient that the facts should be "available to the public"; Cohalan v New York Tribune Inc 15 NYS 2d 58 at 61 (1939) ("accessible to any one who wished to examine the record"); Restatement of the Law of Torts, (1938), vol 3 at 277, commenting on §606; cf Jensen, "Recent Developments in the Law of Privilege and Fair Comment", (1965) 42 North Dakota Law Review 185 at 191 ("readily available"); Taylor, "Constitutional Limitations on the Defenses of Fair Comment and Conditional Privilege", (1965) 30 Missouri Law Review 467 at 470 ("known or available to the recipient") and Harper, "Privileged Defamation", (1936) 22 Virginia Law Review 642 at 659 ("accessible to" the recipient). Kirby which such technology has on the defence. In expressing the common law, we cannot ignore those impacts. The decision that the defence of fair comment is arguably available in such circumstances is not, of course, an indication that it will necessarily be upheld. It would remain for the tribunal of fact at the trial to decide whether the words published constitute comment or fact; whether the defendant can prove the truth of every fact so identified as the basis of the comment199; whether or not the comment relates to a matter of public interest; whether it is "fair"200; and if all the foregoing is established, whether the defence is defeated by proof of malice on the part of the defendant201. All of these are issues for trial. They are not apt to interlocutory peremptory determination which is what the plaintiff now seeks. The proper outcome to the substantive issues Consequences of concurrence: For the foregoing reasons, I reject each of the first two lines of reasoning favoured in the joint reasons202. However, this leaves me in agreement with the other arguments in the joint reasons affording alternative, and independent, grounds for arriving at the conclusion that pars 3.1- 3.39 of the defence should be struck out203. I also agree with the treatment in the joint reasons of the remaining pleading issues204. So do my differences with the joint reasons on the two issues that I have explained require different orders disposing of these proceedings? Claim of deliberate concealment: My disagreement with the joint reasons over issues (1) and (2) is not ultimately determinative. In the circumstances of 199 Peter Walker & Son Ltd v Hodgson [1909] 1 KB 239 at 250, 254, 256-257. 200 O'Shaughnessy v Mirror Newspapers Ltd (1970) 125 CLR 166 at 173. 201 O'Shaughnessy v Mirror Newspapers Ltd (1970) 72 SR (NSW) 347 at 352; Pervan (1993) 178 CLR 309 at 329. 202 That the defence of fair comment is unavailable because (1) the statements pleaded in pars 3.1-3.4 constitute statements of fact, not comment; and (2) the relevant facts are not sufficiently identified as required by law. 203 That the defence of fair comment pleaded by the defendant must address the meaning pleaded by the plaintiff, which it does not do; and that the matters pleaded in pars 3.1-3.39 are insufficient to lead an honest person to think that the plaintiff deliberately concealed evidence. 204 Joint reasons at [96]. Kirby this case, agreement on issues (3) and (4) is fatal to the defendant's reliance on fair comment as pleaded. The plaintiff pleaded that the meaning of the promotion upon which he relied was that he had "deliberately concealed evidence from the trials of Mr Keogh" (emphasis added). This is the interpretation of the matter complained of with which the plaintiff goes to trial. In any fair comment defence, the defendant is substantially obliged to respond to that pleading. There may have been other interpretations of the publication (eg that the plaintiff was grossly careless, unprofessional, incompetent etc). However, the plaintiff has not chosen to sue on those interpretations. He has nailed his colours solely to the mast of dishonesty. Thus, he has not sued the defendant for defamation in respect of the full programme which the promotion foreshadowed. I agree with the conclusion expressed in the joint reasons205 that there is a great difference between a person such as the plaintiff displaying incompetence (or carelessness, unprofessionalism etc), on the one hand, and deliberately concealing evidence that could result in the conviction of an accused person of murder, on the other. If, at trial, the plaintiff succeeded in establishing the meaning he had pleaded, it is and should be no defence at law for the defendant to prove that the plaintiff was incompetent and mistaken in the performance of his professional duties. If the plaintiff failed to prove that meaning, his action must likewise fail. Resulting strike-out order: The result is that the facts pleaded in pars 3.1- 3.39 must be struck out. However, I would make that order on these grounds alone. I would not make that order on the analysis of the ambit and requirements of the fair comment defence. It follows that there must be consequential amendment to other paragraphs of the defence206. Still further paragraphs should be treated as struck out, for reasons explained in the joint reasons207. Ordinary facility to re-plead: This leaves only the issue of re-pleading. Ordinarily, where there has been dispute about the admissibility of pleadings, a party is afforded the opportunity to reconsider its position in the light of the court's ruling on the applicable law. The party which fails is normally permitted 205 Joint reasons at [86]. See also reasons of Gleeson CJ at [2]. 206 Joint reasons at [96] referring to par 8.1. 207 See joint reasons at [25], [101]. Kirby to re-plead208. Re-pleading may be refused where the party's case is obviously hopeless and doomed to fail or where repeated opportunities to re-plead have failed or been abused. The present is a case where there must, in any event, be a trial of the plaintiff's action on the merits. This is so because the defendant has grounds of defence that are unaffected by the disputes over the defence of fair comment. Certainly, the trial has been grossly delayed over the fair comment controversies, as the joint reasons hold. Cases do exist where courts will mark their disapproval of the unjustified conduct of proceedings by making appropriate orders, including as to costs209. The joint reasons decide that the defendant should be given no opportunity to re-plead its fair comment defence. The stated explanation210 is that the pleadings have been repeatedly criticised without any concession by the defendant that there was anything substantially wrong with them. The joint reasons also refer to what appear to me to be policy considerations concerning delays generally in defamation litigation, the delays in the present case and the need to teach the defendant and other powerful publishers like it a salutary lesson. I agree that, where established law or legal practice is abused or not complied with, the correct way for a court to mark disapproval and right legal wrongs is to make orders giving effect to such conclusions, not just to resort to judicial admonitions in the form of dicta211. However, there were novel questions in issue in this appeal. Fair warnings of novel outcomes: This is not a case where there has been unanimity, in the various levels in which these proceedings have been litigated, concerning the relief to which the plaintiff was entitled. I agree that, generally speaking, repeated re-pleading is unfair to less well-resourced litigants, usually plaintiffs, and should be discouraged. However, it is one thing to mark disapproval of a party's conduct of the litigation by imposing costs orders. It is another to put a party out of court in an action, or on an aspect of its legal claims, 208 See The Laws of Australia, Title 5, "Civil Procedure", Subtitle 5.2, "Pleadings and Amendment" at 136 [111]; see also Thorpe v The Commonwealth [No 3] (1997) 71 ALJR 767 at 774-775; 144 ALR 677 at 686-687. 209 cf Nowlan v Marson Transport Pty Ltd (2001) 53 NSWLR 116 at 128-129 [28]- [32] per Heydon JA; cf Sweeney v Boylan Nominees Pty Ltd (2006) 226 CLR 161 210 Joint reasons at [99]. 211 Libke v The Queen (2007) 81 ALJR 1309 at 1322 [49]-[50]; 235 ALR 517 at 532- 533; Gately v The Queen [2007] HCA 55 at [48]. Kirby after deciding disputed questions of law regarding the elements of a claim or defence that that party has sought to plead. By inference, this Court granted special leave to the defendant because there were contestable questions of defamation pleading practice to be settled. Those questions have now been decided. Indeed, by virtue of the plaintiff's cross-appeal, they have been decided in a way different from the conclusion reached in the Full Court. In the Full Court, the plaintiff did not even object to pars 3.1-3.4, which this Court now strikes out with no right to re-plead. The plaintiff there agreed that the defendant should be afforded a final opportunity to plead particulars in support of its defence of fair comment212. Now to deny the defendant that opportunity strikes me as unfair. The defendant received no warning of the risk that it might be deprived of its normal right to re-plead, if the present appeal were decided against it213. Normally, a party would be warned of such a peril, either in earlier judicial observations of a general kind or in exchanges during oral argument. No such warning was afforded to the defendant here. The course now adopted may be viewed as a punishment to the defendant for pursuing its legal rights which this Court granted it leave to argue. It is true that the defendant may find it difficult to re-plead a fair comment defence in the light of the conclusions expressed in the joint reasons and also in my own reasons. However, it should have the opportunity to take advice on the point, the warning having now been given to it and others in a similar position. I would grant leave to re-plead but impose a strict time limit within which to do so. Re-pleading and importance of fair comment: Doubtless my differing conclusion in respect of the proper orders is influenced to some degree by the views that I hold concerning the importance of the fair comment defence in the protection of free expression in Australia, particularly in the broadcasting media, such as the defendant. The defence of fair comment, and the pleading of that defence, can be abused and misused, that is true. Yet, ultimately, the right of fair comment defends the entitlement of us all to live in a society where diverse comments and opinions may be expressed under fair conditions established by law. This Court now having spoken on the subject, the defendant should have a last opportunity to be advised on whether it can re-plead – just as the plaintiff accepted before the Full Court that it should have. The saga has been protracted and expensive. Further such litigation is to be discouraged, including by appropriate costs orders. However, the present proceedings having come so far, they must be finished justly. 212 Manock (2006) 95 SASR 462 at 472 [21]. 213 cf Parker v Director of Public Prosecutions (1992) 28 NSWLR 282 at 293-297. Kirby Orders I agree in the orders proposed in the joint reasons214. To those orders I would propose that a fifth order be added: The appellant to have leave within twenty-eight days to re-plead particulars to support its defence of fair comment, consistently with the reasons of this Court. 214 Joint reasons at [102].

HIGH COURT OF AUSTRALIA CLIVE FREDERICK PALMER & ANOR PLAINTIFFS AND THE STATE OF WESTERN AUSTRALIA & ANOR DEFENDANTS Palmer v Western Australia [2021] HCA 5 Date of Hearing: 3 & 4 November 2020 Date of Order: 6 November 2020 Date of Publication of Reasons: 24 February 2021 ORDER The questions stated for the opinion of the Full Court in the special case filed on 22 September 2020 be answered as follows: Are the Quarantine (Closing the Border) Directions (WA) and/or the authorising Emergency Management Act 2005 (WA) invalid (in whole or in part, and if in part, to what extent) because they impermissibly infringe s 92 of the Constitution? Answer: On their proper construction, ss 56 and 67 of the Emergency Management Act 2005 (WA) in their application to an emergency constituted by the occurrence of a hazard in the nature of a plague or epidemic comply with the constitutional limitation of s 92 of the Constitution in each of its limbs. The exercise of the power given by those provisions to make paras 4 and 5 of the Quarantine (Closing the Border) Directions (WA) does not raise a constitutional question. No issue is taken as to whether the Quarantine (Closing the Border) Directions (WA) were validly authorised by the statutory provisions so that no other question remains for determination by a court. (b) Who should pay the costs of the special case? Answer: The plaintiffs. Representation P J Dunning QC with R Scheelings and P J Ward for the plaintiffs (instructed J A Thomson SC, Solicitor-General for the State of Western Australia, with J D Berson for the defendants (instructed by State Solicitor's Office (WA)) P J F Garrisson SC, Solicitor-General for the Australian Capital Territory, with H Younan SC and A M Hammond for the Attorney-General for the Australian Capital Territory, intervening (instructed by ACT Government Solicitor) M E O'Farrell SC, Solicitor-General for the State of Tasmania, with S K Kay for the Attorney-General for the State of Tasmania, intervening (instructed by Solicitor-General of Tasmania) G A Thompson QC, Solicitor-General of the State of Queensland, with F J Nagorcka and K J E Blore for the Attorney-General of the State of Queensland, intervening (instructed by Crown Law (Qld)) M J Wait SC, Solicitor-General for the State of South Australia, with F J McDonald for the Attorney-General for the State of South Australia, intervening (instructed by Crown Solicitor's Office (SA)) P J Hanks QC with P P Thiagarajan and T M Wood for the Attorney-General for the State of Victoria, intervening (instructed by Victorian Government Solicitor's Office) T J Moses with L S Peattie for the Attorney-General for the Northern Territory, intervening (instructed by Solicitor for the Northern Territory) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Palmer v Western Australia interstate Constitutional law (Cth) – Freedom of trade, commerce, and intercourse – Where s 56 of Emergency Management Act 2005 (WA) ("EM Act") empowered Minister to declare state of emergency – Where s 67 empowered authorised officer to direct or prohibit movement of persons into emergency area – Where Minister for Emergency Services declared state of emergency in Western Australia in respect of COVID-19 pandemic – Where State Emergency the Border) Directions (WA) Coordinator ("Directions") – Where paras 4 and 5 of Directions prohibited persons from entering Western Australia unless exempt traveller – Whether EM Act or in s 92 of infringed constitutional Directions Constitution – Whether infringement determined by reference to authorising provisions of EM Act – Whether provisions of EM Act imposed impermissible burden on interstate trade, commerce or intercourse – Whether exercise of power to make Directions raised constitutional question. issued Quarantine (Closing impermissibly limitation Words and phrases – "burden", "COVID-19", "differential", "discrimination", trade, "emergency", "emergency management", "freedom of commerce, and intercourse", "hazard", "intercourse", "interstate movement", "plague or epidemic", “protectionist”, "reasonable necessity", "state of emergency", "structured proportionality", "trade and commerce". interstate Constitution, s 92. Emergency Management Act 2005 (WA), ss 56, 58, 67, 72A. Quarantine (Closing the Border) Directions (WA), paras 4, 5, 27. KIEFEL CJ AND KEANE J. On 11 March 2020 the World Health Organization declared COVID-19 a pandemic. On 15 March 2020 the Minister for Emergency Services for Western Australia declared a state of emergency with effect from 16 March 2020 in respect of the pandemic pursuant to s 56 of the Emergency Management Act 2005 (WA) ("the EM Act"). The area to which the state of emergency declaration was to apply was Western Australia. The Commissioner of Police, as the holder of the office of State Emergency Coordinator1, issued the Quarantine (Closing the Border) Directions (WA) ("the Directions"), which took effect from 5 April 2020. The EM Act Section 56 of the EM Act, in relevant part, provides: "(1) The Minister may, in writing, declare that a state of emergency exists in the whole or in any area or areas of the State. The Minister must not make a declaration under this section unless the Minister – has considered Coordinator; and the advice of the State Emergency is satisfied that an emergency has occurred, is occurring or is imminent; and is satisfied that extraordinary measures are required to prevent or minimise – loss of life, prejudice to the safety, or harm to the health, of persons or animals". An "emergency" is defined2 to mean "the occurrence or imminent occurrence of a hazard which is of such a nature or magnitude that it requires a significant and coordinated response". The meaning of "hazard" includes "a plague or an epidemic". A state of emergency declaration (an "emergency declaration") remains in force for three days after the time it first has effect if it is not extended by a EM Act, s 10. EM Act, s 3. declaration made by the Minister under s 583. Section 58(4) relevantly provides that an emergency declaration may be extended for a period not exceeding 14 days. It may be further extended from time to time4. The original emergency declaration of 15 March 2020 was so extended and further extended and remained current at the time of the hearing. There is no dispute that the Directions were authorised by the EM Act. The EM Act contains general powers such as those in s 72A(2), whereby an authorised officer may "take, or direct a person or a class of person to take, any action that the officer considers is reasonably necessary to prevent, control or abate risks associated with the emergency". But s 67 is most clearly directed to the border restrictions here in question. Its relevant parts were included in the EM Act as passed and provide: "For the purpose of emergency management during an emergency situation or state of emergency, a[n] ... authorised officer may do all or any of the following – direct or, by direction, prohibit, the movement of persons, animals and vehicles within, into, out of or around an emergency area or any part of the emergency area". The State Emergency Coordinator (the Commissioner of Police) is an authorised officer5. The emergency area according to the emergency declaration is Western Australia. The words "emergency management", which appear in s 67, mean "the management of the adverse effects of an emergency" and relevantly include "prevention" ("the mitigation or prevention of the probability of the occurrence of, and the potential adverse effects of, an emergency") and "response" ("the combating of the effects of an emergency, provision of emergency assistance for casualties, reduction of further damage, and help to speed recovery")6. It is an offence to fail to comply with a direction7. The effect of the Directions is to close the border of Western Australia to all persons from any place unless they were the subject of exemption under the Directions. Paragraph 4 of the Directions provides that "[a] person must not enter EM Act, s 57, s 58(1). EM Act, s 58(1). EM Act, s 3 (definition of "authorised officer"). EM Act, s 3 (definition of "emergency management" (a) and (c)). EM Act, s 86(1). Western Australia unless the person is an exempt traveller". The term "exempt traveller", defined in para 27, refers to a person falling within certain categories such as officials or personnel concerned with national and State security and governance, persons providing health services or persons whose entry is approved on compassionate grounds, and who complies with any specified terms or conditions. Paragraph 5 of the Directions states that in certain circumstances even exempt travellers must not enter Western Australia, for example where they have certain defined symptoms or have been identified as a close contact with a person At the time this matter was heard, the Chief Health Officer for Western Australia had given advice to the Premier of Western Australia concerning easing of the border controls. The Premier and the Minister for Health had announced publicly that the "existing hard border exemption system will be removed and replaced with an updated nationwide health-based threshold that allows for safe travel into Western Australia" from interstate on conditions. Subject to the latest available health advice, it was planned to enact the new interstate border measures under the EM Act on 14 November 2020. The plaintiffs nevertheless proceeded with the hearing of their matter because, they contended, the Premier's announcement was highly conditional and there was an important, justiciable controversy to be resolved. The plaintiffs' challenge The first sentence of s 92 of the Constitution provides that: "On the imposition of uniform duties of customs, trade, commerce, and intercourse among the States, whether by means of internal carriage or ocean navigation, shall be absolutely free." The first plaintiff is a resident of the State of Queensland and the Chairman and Managing Director of the second plaintiff. He travels to and from Western Australia for purposes associated with the second plaintiff and for other purposes, and whilst in Perth stays at a residence maintained by the second plaintiff. He has not, to his knowledge, suffered any symptoms of COVID-19. His application to enter Western Australia as an "exempt traveller" was refused. The second plaintiff is a company with interests in iron ore projects in Western Australia and is engaged in litigation and arbitration in that State. It has offices and personnel in Perth, where many of its records are held. Other personnel, including professional advisers who would normally work in both Brisbane and Perth, are likewise unable to enter Western Australia. It contended that its business and other interests are harmed or inhibited. In proceedings commenced on 25 May 2020 in the original jurisdiction of this Court the plaintiffs claim a declaration that "either the authorising Act and/or the Directions are invalid, either wholly or in part … by reason of s 92 of the Constitution". The plaintiffs' claims to invalidity and the particulars provided of them refer to the Directions and their effects. The plaintiffs claim that the Directions impose an effective burden on the freedom of intercourse among the Australian people in the several States by prohibiting cross-border movement of persons, backed by a criminal sanction. Alternatively, they allege that the freedom of trade and commerce guaranteed by s 92 is contravened because the Directions impose an effective discriminatory burden with protectionist effect. The defendants, the State of Western Australia and the Commissioner of Police for Western Australia, deny the plaintiffs' allegations. In their defence they plead that s 67 and other provisions of the EM Act do not have the purpose of economically protecting the State of Western Australia, rather they have the legitimate purpose of protecting the population of Western Australia against risks arising from emergency situations. The continuation in force of the Directions, pursuant to the EM Act, does not have a protectionist purpose and is reasonably necessary to achieve, and is compatible with, the legitimate purpose of protecting the Western Australian population against the health risks of COVID-19 where there are no other equally effective means available to achieve that purpose which would impose a lesser burden on interstate trade or commerce. Likewise, it is pleaded the States, whether by movement or communication, is prevented only to the extent that is reasonably necessary and that there are no other, equally effective means which impose a lesser burden on that intercourse. intercourse among that No agreement could be reached between the parties as to the facts necessary to determine the defendants' claim of the reasonable need for and efficacy of the measures contained in the Directions, which would have enabled an earlier hearing of the matter by this Court. By order made on 16 June 2020, that issue was remitted to the Federal Court of Australia for hearing and determination pursuant to s 44 of the Judiciary Act 1903 (Cth). On 25 August 2020 Rangiah J of that Court made findings of fact. The findings on remitter After hearing evidence from a number of witnesses, including the Chief Health Officer for Western Australia and experts in public health medicine, epidemiology, and infectious diseases, Rangiah J found that certain facts relating to COVID-19 and SARS-CoV-2, which had been pleaded by the defendants as particulars of the justification for the Directions, had been proved8. The facts so found included the following. COVID-19 is a disease caused by the coronavirus SARS-CoV-2. Clinical and epidemiological knowledge about them is relatively uncertain, their being a new pathogen and disease. SARS-CoV- 2 may be transmitted by a person who is asymptomatic and unaware that they have the disease. Where there is community transmission of SARS-CoV-2 its natural growth rate is exponential and must be minimised through certain measures. The risk of community transmission is substantially increased if measures of the kind contained in the Directions are removed. There are no known testing measures which are themselves sufficient to prevent community transmission. The consequences of community transmission of SARS-CoV-2 and the development of COVID-19 are substantial, including the increased risk of death – particularly for members of the population who are over 70 years of age, members of the population with pre-existing medical conditions or members of the Aboriginal or Torres Strait Islander population – and the risk that the hospital system in Western Australia will be unable to cope. There is no known vaccine, and no treatment presently available to mitigate the risks of severe medical outcomes or mortality for a person who contracts COVID-19. At the conclusion of his detailed reasons his Honour summarised the overall findings he had made9. His Honour considered that the risk to the health of the Western Australian population is a function of two factors: the probability that COVID-19 would be imported into the population and the seriousness of the consequences if it were imported. Whilst the existing border restrictions do not eliminate the potential for importation of COVID-19 from other States or Territories, because they allow "exempt travellers" to enter Western Australia, they have been effective to a "very substantial extent" to reduce the probability of COVID-19 being imported into Western Australia from interstate. His Honour explained that the uncertainties involved in predicting all relevant factors are such that the probability of persons infected with COVID-19 entering Western Australia in the hypothetical situation where border restrictions are removed cannot be accurately quantified. His Honour therefore undertook qualitative assessments of the probability that persons infected with COVID-19 would enter Western Australia if the border restrictions were completely removed. His Honour assessed the risk of persons coming from Australia as a whole and from Victoria as high; from New South Wales as moderate; from South Australia, Palmer v Western Australia [No 4] [2020] FCA 1221 at [363]-[364]. Palmer v Western Australia [No 4] [2020] FCA 1221 at [366]. the Australian Capital Territory and the Northern Territory as low; from Tasmania as very low; and from Queensland as uncertain, due to the recent reintroduction of the disease in that State. It is evident that there have been some changes in the circumstances of the States since his Honour's assessments. The plaintiffs contended that Queensland would now be regarded as a low, rather than uncertain, risk and the situation in Victoria has changed. It will not be necessary to come to a concluded view about these contentions. They are not determinative of any issue in the proceedings. His Honour considered that if persons entered the Western Australian community whilst infectious there would be a high probability that the virus would be transmitted into the Western Australian population and at least a moderate probability that there would be uncontrolled outbreaks. If there were uncontrolled outbreaks, the consequences would include the risk of death and hospitalisation, particularly for the vulnerable groups mentioned above. In a worst-case scenario, the health consequences could be "catastrophic". His Honour observed that Western Australia had not had any cases of community transmission since 12 April 2020 as a result of the combination of the border restrictions and other measures. Western Australia could not safely manage the number of people in hotel quarantine if it were sought to replace the border restrictions with mandatory hotel quarantine for all entrants to the State. If the restrictions were replaced by a suite of measures including exit and entry screening, the wearing of face masks on aeroplanes and for 14 days after entry into the State, and testing at intervals, they would be less effective than the border restrictions in preventing the importation of COVID-19. A combination of that suite of measures together with a "hotspot" regime, involving either quarantining or banning persons entering from designated areas in the other States or Territories, would also be less effective than the border restrictions. His Honour concluded that in view of the uncertainties involved in determining the probability that COVID-19 would be imported into Western Australia from elsewhere in Australia, and the potentially serious consequences if it were imported, "a precautionary approach should be taken to decision-making about the measures required for the protection of the community". The questions reserved The parties subsequently agreed a Special Case pursuant to which the following questions were stated for the opinion of the Full Court of this Court: "(a) Are the Quarantine (Closing the Border) Directions (WA) and/or the authorising Emergency Management Act 2005 (WA) invalid (in whole or in part, and if in part, to what extent) because they impermissibly infringe s 92 of the Constitution? (b) Who should pay the costs of the special case?" On 6 November 2020 the Court answered the questions as follows: "(a) On their proper construction, ss 56 and 67 of the Emergency Management Act 2005 (WA) in their application to an emergency constituted by the occurrence of a hazard in the nature of a plague or epidemic comply with the constitutional limitation of s 92 of the Constitution in each of its limbs. The exercise of the power given by those provisions to make paras 4 and 5 of the Quarantine (Closing the Border) Directions (WA) does not raise a constitutional question. No issue is taken as to whether the Quarantine (Closing the Border) Directions (WA) were validly authorised by the statutory provisions so that no other question remains for determination by a court. The plaintiffs." These are our reasons for joining in the answers given. What s 92 precludes Although it is sometimes convenient to refer to s 92 as having two limbs – the trade and commerce limb and the intercourse limb – the words "trade, commerce, and intercourse" are stated in the section as a composite expression. The observation that until Cole v Whitfield10 decisions of this Court did not treat the two limbs as substantially different11 is clearly correct. Section 92 has been regarded as concerned with all kinds of movement across State borders12. Cole v Whitfield It is well understood that Cole v Whitfield marked a turning point in s 92 jurisprudence. Prior to that decision, s 92 had been regarded by many as (1988) 165 CLR 360. 11 APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 456 [400] 12 Bank of New South Wales v The Commonwealth ("the Bank Nationalisation Case") (1948) 76 CLR 1 at 381-382 per Dixon J. guaranteeing the right of individuals to engage in trade, commerce and intercourse. The broad effects of such an approach were mitigated by the "criterion of operation" doctrine, by which s 92 was applied only to laws directed to an essential attribute of interstate trade, commerce or intercourse13. These interpretations were rejected in Cole v Whitfield14, where the Court instead adopted an approach which had regard to the character of a law and its effects upon freedom of interstate trade and commerce. In Cole v Whitfield15 the Court said that the guarantee in s 92, that interstate trade, commerce and intercourse be "absolutely free", was not to be taken literally. The section should not be construed as precluding an exercise of legislative power which would impose any barrier or restriction on interstate trade or commerce16 or interstate intercourse17. This view of s 92 had consistently been applied in cases which preceded Cole v Whitfield18 and it was to be confirmed in subsequent cases19. Cole v Whitfield explained that so far as s 92 concerned interstate trade and commerce it should be understood to preclude particular types of burdens on that trade or commerce, such as discriminatory burdens of a protectionist kind. It held that a law will relevantly discriminate if on its face it subjects interstate trade or commerce to a disability or disadvantage or if the operation of the law in fact 13 See Gratwick v Johnson (1945) 70 CLR 1 at 20 per Dixon J. (1988) 165 CLR 360 at 400-402. (1988) 165 CLR 360 at 394. 16 Cole v Whitfield (1988) 165 CLR 360 at 398. 17 Cole v Whitfield (1988) 165 CLR 360 at 393. 18 See, eg, R v Smithers; Ex parte Benson (1912) 16 CLR 99 at 110 per Barton J; Gratwick v Johnson (1945) 70 CLR 1 at 13 per Latham CJ. 19 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 56 per Brennan J; Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 192-193 per Dawson J; APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 394 [178] per Gummow J. produces such a result20. The freedom which s 92 guarantees is freedom from discriminatory burdens which have a protectionist effect21. Discrimination in a legal sense involves a comparison of relative equals by which one is treated unequally, or of unequals treated equally22. It involves the notion of effecting a disadvantage to one23. So understood, for the purposes of s 92, a law discriminates when it treats interstate trade or commerce differently, as compared with intrastate trade or commerce, and effects a disadvantage to interstate trade or commerce. Not all laws which apply differentially so as to effect a discriminatory burden on interstate trade or commerce will infringe s 92. This possibility arises because the guarantee of freedom is not absolute, as previously discussed. Where such a law has a purpose which is evidently not of a protectionist kind it may, subject to a further requirement, be valid. The law in Cole v Whitfield was of this kind. The respondents in Cole v Whitfield sought to bring crayfish to Tasmania from South Australia in the course of their interstate trade. The regulation in question prohibited the possession of crayfish less than a particular size in Tasmania. The law was seen as burdening interstate trade24. It was protectionist in purpose, but in a sense different from protectionism in trade. Its purpose was to protect and conserve a valuable natural resource, namely the stock of Tasmanian crayfish. This purpose, the Court said, is not a form of protection which gives a market advantage25. It concluded that the law could not be described as discriminatory and protectionist in the sense referable to s 9226. 20 Cole v Whitfield (1988) 165 CLR 360 at 394, 399. 21 Cole v Whitfield (1988) 165 CLR 360 at 394-395. 22 See Castlemaine Tooheys Ltd v South Australia (1990) 169 CLR 436 at 478, 480 per Gaudron and McHugh JJ. 23 See Cole v Whitfield (1988) 165 CLR 360 at 399. 24 Cole v Whitfield (1988) 165 CLR 360 at 409. 25 Cole v Whitfield (1988) 165 CLR 360 at 409. 26 Cole v Whitfield (1988) 165 CLR 360 at 410. The law's character as non-protectionist was not the only feature which saved it from invalidity. It is important to observe what was said in Cole v Whitfield concerning the need for the law. The Court said27 that the extension of the prohibition beyond crayfish in Tasmania to imported interstate crayfish was necessary to prevent undersized crayfish being caught in Tasmanian waters. It was necessary because it was not possible for the State to undertake inspections other than random inspections and it could not determine which were and which were not Tasmanian crayfish. The Court may be understood to say that there was no real alternative to the prohibition on the sale and possession of undersized crayfish imported from interstate if the statutory objective of protection of crayfish stock in Tasmania was to be achieved. The purpose of the law in Cole v Whitfield may be contrasted with the purposes identified with respect to the laws in question in Castlemaine Tooheys Ltd v South Australia28. It was accepted in the joint judgment of Mason CJ, Brennan, Deane, Dawson and Toohey JJ29 that there were "rational and legitimate" grounds for the apprehension that non-refillable bottles contribute to the problem of litter and decrease the State's energy resources. If the legislative measures were "appropriate and adapted" to the resolution of those problems, their Honours said, they would be consistent with s 92. That would be so if the burden imposed on interstate trade "was incidental and not disproportionate" to the achievement of those purposes. The joint judgment in Castlemaine Tooheys concluded30 that neither purpose provided "an acceptable explanation or justification for the differential treatment" given to the plaintiffs' products. Betfair Pty Ltd v Western Australia ("Betfair No 1")31 was more clearly to articulate that the justification required of a discriminatory law which burdened interstate trade was that it be reasonably necessary to achieve its non-protectionist purpose. 27 Cole v Whitfield (1988) 165 CLR 360 at 409-410. (1990) 169 CLR 436. 29 Castlemaine Tooheys Ltd v South Australia (1990) 169 CLR 436 at 473-474. (1990) 169 CLR 436 at 477. (2008) 234 CLR 418. Betfair No 1 – justifying a burden In the joint judgment in Betfair No 132 it was said that considerations to which weight must be given in an assessment of the "proportionality" between the differential burden imposed by the laws on an out-of-State producer, compared with the position of in-State producers, suggested the application of a criterion of "reasonable necessity" to the law in question. In North Eastern Dairy Co Ltd v Dairy Industry Authority of NSW33, Mason J had said that "[a]s the defendant has failed to show that the discriminatory mode of regulation selected is necessary for the protection of public health, it is in my judgment not a reasonable regulation of the interstate trade in pasteurized milk". That view of the matter, it was said in Betfair No 1, "should be accepted as the doctrine of the Court"34. It was, their Honours observed, consistent with the explanation given in Cole v Whitfield of the justification of the total prohibition on sale of undersized crayfish. The first plaintiff in Betfair No 1 conducted a betting exchange in Tasmania through the use of the internet and telephone call centres. Legislation in Western Australia made it an offence for a person to use a betting exchange and an offence to make available information as to the field of a horse or greyhound race in Western Australia, without authorisation. The first-mentioned law effected a discriminatory burden of a protectionist kind; the second operated to the competitive disadvantage of interstate operators such as the first plaintiff, imposing a discriminatory burden of a protectionist kind35. Western Australia argued that the measures were necessary to protect the integrity of the racing industry in that State. In the section of the joint judgment headed "Acceptable explanation or justification?"36, it was said that even allowing for the presence of some such threat to the racing industry, to which the legislative provisions might be directed, the prohibitions could not be justified. They could not be justified if there was the prospect of an alternative method of countering the (2008) 234 CLR 418 at 476-477 [101]-[103] per Gleeson CJ, Gummow, Kirby, Hayne, Crennan and Kiefel JJ. (1975) 134 CLR 559 at 608. (2008) 234 CLR 418 at 477 [103]. 35 Betfair No 1 (2008) 234 CLR 418 at 481 [118], [120]. 36 Betfair No 1 (2008) 234 CLR 418 at 479 [110]. threat and that method was "effective but non-discriminatory regulation"37. The joint judgment accepted that different legislative measures taken by Tasmania with respect to betting exchanges fulfilled these criteria. The prohibitions effected by the legislation in Western Australia could not therefore be said to be "necessary". Their Honours concluded that "the prohibitory State law is not proportionate; it is not appropriate and adapted to the propounded legislative object"38. Interstate movement – a distinction? The guarantee of freedom of interstate intercourse may be taken to refer to both physical movement and communication across State borders, and to be directed to the circumstance where borders are used as barriers to freedom of movement between States. Until now there has been no occasion since Cole v Whitfield fully to consider the distinction drawn in that case between this freedom and that respecting interstate trade and commerce. Consistently with the rejection of the individual rights approach with respect to interstate trade and commerce, the Court in Cole v Whitfield regarded s 92 as effecting a limit on laws which may be made affecting those subjects. But in discussion about interstate intercourse it took quite a different approach. It regarded the guarantee of freedom of interstate movement as extending to a "guarantee of personal freedom 'to pass to and fro among the States without burden, hindrance or restriction'"39, drawing in part on what had been said by Starke J in Gratwick v Johnson40. It is understandable why it was thought necessary in Cole v Whitfield to make plain that s 92 was not intended as a protection of individual interstate traders. It was concerned more generally with effects on interstate trade and commerce. It is not entirely clear why it was thought necessary to retain the notion of a right of persons to pass between the States. It was not fully explained. The matter in Cole v Whitfield engaged only the trade and commerce limb. Having distinguished the intercourse limb, no further discussion about it was engaged in. It was put to one side. 37 Betfair No 1 (2008) 234 CLR 418 at 479 [110]. 38 Betfair No 1 (2008) 234 CLR 418 at 479-480 [109]-[112]. 39 Cole v Whitfield (1988) 165 CLR 360 at 393. (1945) 70 CLR 1 at 17. A basis given in Cole v Whitfield for distinguishing between the two limbs was that some forms of interstate intercourse are likely of their nature to be immune from legislative or executive interference. If a like immunity were accorded to trade and commerce "anarchy would result"41. Since s 92 had never been understood to guarantee freedom to this extent, there is no reason, the Court said, for insisting on a strict correspondence between the freedoms42. Some support for the distinction drawn in Cole v Whitfield was said to arise from history. It may be accepted that interstate movement was not adopted at a later point in the course of the Convention Debates and that it was no mere afterthought43. But as earlier observed44, prior decisions of this Court respecting s 92 did not meaningfully distinguish between the two limbs. The nature of the guarantee provided with respect to them was not regarded as different. In its application to either of the freedoms it was not regarded as absolute. This hardly suggests that interstate movement should be favoured with some kind of immunity. The distinction drawn in Cole v Whitfield has the obvious consequence that guarantees of freedoms appearing in the one provision of the Constitution are to be treated differently. This might suggest incoherence, which is not regarded as a desirable outcome for constitutional interpretation. More importantly, the distinction drawn in Cole v Whitfield is not consistent with a modern approach to constitutional interpretation. The distinction does not derive any support from the text of s 92. The text does not provide a basis for treating one of three elements of the composite expression "trade, commerce, and intercourse among the States" as connoting or requiring that some different test be applied to them45. Cole v Whitfield did not discuss whether the approach there taken to discriminatory burdens imposed by a law on freedom of interstate trade and commerce, shorn of its economic aspects, might be applied to the freedom of interstate intercourse. It is that prospect which should now be addressed. 41 Cole v Whitfield (1988) 165 CLR 360 at 393. 42 Cole v Whitfield (1988) 165 CLR 360 at 393-394. 43 Cole v Whitfield (1988) 165 CLR 360 at 387-388. 44 At [27] above. 45 APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 456-457 Interstate movement and discrimination It must be accepted that protectionist discrimination and its economic effects are not likely to be relevant to interstate movement. Further, a law which differentiates between interstate movement and intrastate movement may not advantage the latter to any real extent. Nevertheless it is possible to compare the effects of a law on interstate movement with its effects on intrastate movement. That is to say the test of discrimination which is applied to the trade and commerce limb could be applied to the intercourse limb. Moreover, as Hayne J observed in APLA Ltd v Legal Services Commissioner (NSW)46, the text of s 92 does not suggest that some different test be applied to the two limbs. Queensland, intervening, submitted that a law may be taken to burden freedom of interstate movement for the purposes of s 92 where it discriminates against that movement47. Discrimination should be required for both limbs of s 92 as a matter of construction, because textually s 92 does not disclose a basis for requiring discrimination for one limb and not the other; the intercourse limb may otherwise largely subsume the trade and commerce limb; and general laws that burden interstate movement may be held invalid. Queensland submitted that a law which burdens interstate movement should be subject to a requirement of justification, in the same way as is required where interstate trade and commerce is burdened. These submissions should be accepted. Burdens on interstate movement as reasonably necessary? In some judgments concerning the intercourse limb it has been suggested that the measure taken by the law should be no more than is "reasonably required" to achieve the object of the law48. In another case it was said that a law should be (2005) 224 CLR 322 at 456-457 [402]. 47 Referring to Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 58-59 per Brennan J; Cunliffe v The Commonwealth (1994) 182 CLR 272 at 333 per Brennan J, 384 per Toohey J; Kirk, "Section 92 in its Second Century", in Griffiths and Stellios (eds), Current Issues in Australian Constitutional Law: Tributes to Professor Leslie Zines (2020) 253 at 279-280. 48 AMS v AIF (1999) 199 CLR 160 at 179 [45] per Gleeson CJ, McHugh and Gummow JJ, 232-233 [221] per Hayne J; APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 353 [38] per Gleeson CJ and Heydon J, 393-394 [177], [179] per Gummow J. "reasonably necessary" to a legitimate purpose49 or "necessary or appropriate and adapted"50 to that. The former test would seem to be more readily capable of justification; however, it is not necessary to discuss the differences between the tests or state a preference. These cases predate the acceptance by this Court in Betfair No 151 of a test of reasonable necessity as explaining or justifying a burden on the freedom of interstate trade and commerce. Since a law which discriminates against interstate movement will prima facie be invalid because it burdens the freedom, logically it should be capable of being justified in the same way. There is good reason in principle why the tests for justification of both limbs should be the same. It should therefore be accepted that a law which is directed to discriminating against, or in fact discriminates against, interstate movement is invalid as contrary to s 92 unless it is justified by reference to a non-discriminatory purpose. It may be justified if it goes no further than is reasonably necessary to achieve a legitimate object, as this Court held in Betfair No 1. It is important to bear in mind what this test requires. The approaches taken by this Court in Cole v Whitfield and Betfair No 1 are instructive. The test of reasonable necessity is not a conclusion to be stated after an impression is gained about a law's purpose and how that purpose is sought to be achieved. It requires more than a view that there exists a need to which it is the statute's purpose to respond and the measures taken are reasonable. The test is to be applied in a concrete way to determine whether the measures which the law permits are themselves reasonably necessary. It is obviously logically relevant to, if not demanded by, that enquiry whether there may be alternative, effective measures available to achieve the same object but which have less restrictive effects on the freedom. If there are, the law in question cannot be said to be reasonably necessary. This is what those cases teach52. 49 Cunliffe v The Commonwealth (1994) 182 CLR 272 at 307-308 per Mason CJ, 396 50 Cunliffe v The Commonwealth (1994) 182 CLR 272 at 346 per Deane J. 51 At [37] above. 52 Cole v Whitfield (1988) 165 CLR 360 at 408-410; Betfair No 1 (2008) 234 CLR 418 at 479-480 [110]-[112] per Gleeson CJ, Gummow, Kirby, Hayne, Crennan and Kiefel JJ; see also Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 51 per In some cases which preceded Betfair No 1, and which concerned both the intercourse limb and the implied freedom of political communication, it was said that a legislative measure which incidentally burdens a freedom (which is to say has that unintended, collateral effect) needs to be "appropriate and adapted"53, "neither inappropriate nor disproportionate", "proportionate"54 or reasonably proportionate55 for the law to be valid. It may be said that at the least Betfair No 1 recognised the connection between the test of reasonable necessity and the concept of proportionality. It is possible to go further. The content given to the test in its application in that case, namely that there was a practicable alternative, clearly aligns it with the second test in structured proportionality, as discussed in McCloy v New South Wales56. The origins of structured proportionality are well known, as is its acceptance by many courts, including common law courts, around the world. It has been the subject of much academic discussion. Sir Anthony Mason57 has described structured proportionality as a "very good illustration" of one of the advantages of comparative law, namely that one "can learn from how other people go about things". The test of structured proportionality, he observed, had been advocated in Canada in R v Oakes58, and applied in the United Kingdom in Bank Mellat v Her 53 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 57 per Brennan J; Cunliffe v The Commonwealth (1994) 182 CLR 272 at 346 per Deane J. 54 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 195 per Dawson J; Cunliffe v The Commonwealth (1994) 182 CLR 272 at 307-308 per Mason CJ, 366 per Dawson J, 396 per McHugh J. 55 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at (2015) 257 CLR 178 at 210 [57], 216 [76] per French CJ, Kiefel, Bell and Keane JJ. 57 Winkelmann et al, "Panel Discussion: Judging", in Mount and Harris (eds), The Promise of Law: Essays Marking the Retirement of Dame Sian Elias as Chief Justice of New Zealand (2020) 471 at 478. [1986] 1 SCR 103. Majesty's Treasury [No 2]59, in New Zealand in R v Hansen60 and in Australia in McCloy. He said: "The structured proportionality approach is something that courts have learnt, not only from Oakes but from Professor Barak in his book on proportionality61. It is a prime example of how you can learn from others." Whilst structured proportionality has its origins elsewhere, it is capable of being applied and must be applied in a particular constitutional context. Its adaptability in part accounts for its adoption globally. And as has been observed62, the joint reasons in McCloy sought to explain structured proportionality as an "indigenous progression of the law rather than an example of explicit 'borrowing' from other jurisdictions". It is not difficult to discern why courts have favoured its application. It reflects a rational approach to the question of whether a law which burdens a right or freedom can be justified, which requires the courts to make something of a value judgment. It discourages conclusory statements, which are apt to disguise the motivation for them, and instead exposes a court's reasoning. It is not obvious that the fact the same questions are to be applied in each case, albeit to different statutory contexts, is a bad thing. It might be said that it reflects the certainty to which the law aspires. It has not been suggested in any case since McCloy that a line of argument otherwise available as a means of justifying a law has been foreclosed. No one could doubt that proportionality is necessary to justification. This Court has repeatedly said so. It cannot be suggested that structured proportionality is a perfect method. None is, but some method is necessary if lawyers and legislators are to know how the question of justification is to be approached in a given case. Structured proportionality certainly seems preferable to its main competitors. It has been said63 that calibrated scrutiny will ultimately end up as a rules-based [2007] 3 NZLR 1. 61 Barak, Proportionality: Constitutional Rights and their Limitations (2012). 62 Chordia, Proportionality in Australian Constitutional Law (2020) at 164. 63 Sir Anthony Mason, "Foreword", in Chordia, Proportionality in Australian Constitutional Law (2020) v at vi, summarising Chordia, Proportionality in Australian Constitutional Law (2020), ch 5. approach, even though it seeks to avoid that outcome, and that the problem with tiered scrutiny is that the court's task becomes one merely of categorising the case. Long before McCloy it had been suggested by Jeremy Kirk that the stages of structured proportionality are discernible in judgments regarding s 92, albeit not expressly acknowledged by the Court as such64. The author gives as an example the judgment of Stephen and Mason JJ in Uebergang v Australian Wheat Board65. Their Honours said that validity could depend on whether there were alternative, practicable means of achieving the legitimate end with less effect on interstate trade. Their Honours also said that the test to be applied is that the legislation be "no more restrictive than is reasonable in all the circumstances, due regard being had to the public interest", which is to say balancing with the "need which is felt for regulation". This reasoning, Kirk considers, includes strict proportionality and is directed to assessing the justification of an impugned law's infringement of the s 92 freedom. There may not be universal acceptance of the application of the three tests of structured proportionality to s 92, although it is difficult to comprehend what criticism could be levelled at a requirement that a law be suitable to its non-discriminatory purpose. This is a question which is invariably addressed in the process of construing the statute in question. One view which has been expressed66 is that the rule stated in Cole v Whitfield with respect to the trade and commerce limb leaves no room for questions of balancing. On the other hand, notions of balancing have been said by Professor Leslie Zines67 to be evident in Castlemaine Tooheys, which was decided after Cole v Whitfield. An acceptance of the tests of structured proportionality does not affect what was said in Cole v Whitfield. It simply explicates the tests for justification, as Betfair No 1 did. Once it is accepted that Betfair No 1, in its application to all the freedoms protected by s 92, requires that a discriminatory law must be justified as reasonably necessary, in the sense that it is understood in proportionality analysis, there seems 64 Kirk, "Constitutional Guarantees, Characterisation and the Concept of Proportionality" (1997) 21 Melbourne University Law Review 1 at 13-16, referred to in Chordia, Proportionality in Australian Constitutional Law (2020) at 147. (1980) 145 CLR 266 at 304-306. 66 Chordia, Proportionality in Australian Constitutional Law (2020) at 151; see also at 143, referred to in Sir Anthony Mason, "Foreword", in Chordia, Proportionality in Australian Constitutional Law (2020) v at vi. 67 Zines, The High Court and the Constitution, 5th ed (2008) at 59. no reason why it should not be justified as adequate in its balance. It may be shown that there is no real alternative to the law, but in some cases the burden on a freedom will be very great and the measures permitted by the law of evidently little importance, which is to say the burden is out of proportion to the need for it. Why should the burden not be said to be unjustified? Castlemaine Tooheys was a case of this kind. Proportionality in the strict sense has been considered to be appropriate by a majority of this Court in implied freedom cases68. It is a justification which the defendants sought to make out in this case. It should be understood to reflect the proper role of this Court as the guardian of constitutionally protected freedoms. This method of justification of a law may assume special importance where the law has a powerful public, protective purpose. The example given by the Commonwealth in McCloy69, when it sought to invoke this justification, was the object of protecting security of the nation at a time of war. Similar metaphors have been applied in public discussion about the crisis affecting the health of persons The plaintiffs, the defendants and at least three of the intervenors accepted that proportionality analysis which includes an analysis of this kind is appropriate to be utilised in considering whether a burden on s 92 is justified. No relevant distinction can be drawn as between the implied freedom of political communication and the s 92 freedoms in this regard. Each are the subject of a constitutional guarantee which has been held not to be absolute. If a burden is effected on a freedom it may be justified by any rational means. The balancing exercise is one such means and it is likely to assume special importance where statutory measures have a purpose as important as the protection of health and life. Section 92 precludes Section 92 may be understood to preclude a law which burdens any of the freedoms there stated, as subjects of constitutional protection, where the law discriminates against interstate trade, commerce or intercourse and the burden 68 McCloy v New South Wales (2015) 257 CLR 178 at 218-220 [84]-[89] per French CJ, Kiefel, Bell and Keane JJ; Clubb v Edwards (2019) 267 CLR 171 at 208- 209 [96]-[102] per Kiefel CJ, Bell and Keane JJ, 266-269 [270]-[275] per Nettle J, 341-345 [491]-[501] per Edelman J; Comcare v Banerji (2019) 93 ALJR 900 at 914- 915 [38]-[42] per Kiefel CJ, Bell, Keane and Nettle JJ, 944-945 [202]-[206] per Edelman J; 372 ALR 42 at 57-59, 98-99. (2015) 257 CLR 178 at 218 [84]. cannot be justified as proportionate to the non-discriminatory, legitimate purpose of the law which is sought to be achieved. Whether it is proportionate is to be determined by the tests of structured proportionality as explained by this Court. A constitutional limitation Victoria, intervening, submitted that the principal question reserved for this Court can and should be answered by reference to the authorising provisions of the EM Act rather than by reference to any particular exercise of those statutory powers, namely the Directions. The defendants adopted these submissions. The submissions should be accepted. They accord with what was said by this Court in Wotton v Queensland70. In Wotton, the Corrective Services Act 2006 (Qld) conferred a discretion to attach such conditions to a parole order as a parole board reasonably considered necessary to ensure the prisoner's good conduct or to prevent the prisoner committing an offence. The discretionary power, in its application to prisoners on parole, could effect a burden on the implied freedom of political communication and the conditions which were attached to the plaintiff's parole order did just that. Although argument was directed to the validity of those conditions, the question of the constitutional limitation effected by the implied freedom was determined by reference to the statute. Drawing upon what Brennan J said in Miller v TCN Channel Nine Pty Ltd71, the joint judgment in Wotton72 explained that the exercise of the statutory power to condition the parole order might be subject to judicial review under the Judicial Review Act 1991 (Qld), but the question of compliance with the constitutional limitation is answered by the construction of the statute. This is consistent with an understanding that constitutionally guaranteed freedoms operate as limits on legislative and executive power. Their Honours accepted that73: "if, on its proper construction, the statute complies with the constitutional limitation, without any need to read it down to save its validity, any complaint respecting the exercise of power thereunder in a given case, such (2012) 246 CLR 1. (1986) 161 CLR 556 at 613-614. (2012) 246 CLR 1 at 9-10 [10], 13-14 [21], [24] per French CJ, Gummow, Hayne, Crennan and Bell JJ; see also at 29-30 [74] per Kiefel J. 73 Wotton v Queensland (2012) 246 CLR 1 at 14 [22]. as that in this litigation concerning the conditions attached to the Parole Order, does not raise a constitutional question, as distinct from a question of the exercise of statutory power". The provisions of the Corrective Services Act were held to comply with the constitutional limitation on State legislative power because they were reasonably necessary or reasonably appropriate and adapted to a legitimate purpose, as Lange v Australian Broadcasting Corporation74 requires, which is to say they were proportionate75. The clarification of where the constitutional question involving freedoms resides is admittedly recent. The delay in stating it may in part be explained by difficulties which attended administrative law and its remedies76 for some time and which have only been resolved relatively recently. In any event the approach taken in Wotton is that which should now be followed. In some cases difficult questions may arise because the power or discretion given by the statute is broad and general. No such question arises in this matter. As will be seen, the power to prohibit or restrict entry into a declared emergency area, which may be the whole of Western Australia, is largely controlled by the EM Act itself and is proportionate to its purposes. Discrimination, burden and justification The power provided by s 56(1) of the EM Act to make an emergency declaration is controlled by s 56(2), which requires that there be an "emergency" or that one is imminent and that extraordinary measures are necessary to protect the life and health of persons. The definitions of "emergency" and "hazard" identify an epidemic as subject to such measures. When an emergency declaration is made it remains in effect for only a short period. Its extension for a longer period requires a further declaration by the Minister. Whilst a state of emergency exists action for the purpose of management of the emergency may be taken, including for the prevention of the occurrence of a plague or an epidemic. By s 67, the prohibition of the movement of persons into a declared emergency area is such an action. (1997) 189 CLR 520. 75 Wotton v Queensland (2012) 246 CLR 1 at 16 [31]-[33] per French CJ, Gummow, Hayne, Crennan and Bell JJ; see also at 33-34 [89]-[92] per Kiefel J. 76 Stellios, "Marbury v Madison: Constitutional Limitations and Statutory Discretions" (2016) 42 Australian Bar Review 324 at 327-328. The plaintiffs submitted that the Directions are directed to preventing interstate movement. Conformably with an approach which has regard to the provisions of the EM Act, the plaintiffs may be understood to submit that those provisions in their application to prevent the entry of persons into Western Australia may be seen as directed to preventing interstate movement. The text of these provisions does not provide support for that submission. They are not directed to the Western Australian border and movement across it. They apply to an emergency area the subject of an emergency declaration, which may be the whole or part of the State, and they may apply to all persons outside the emergency area who seek to enter the area, whether from other States or Territories or from overseas. It cannot therefore be said that by their terms ss 56(1) and 67 of the EM Act discriminate against interstate movement. It must be accepted that in its application to a person coming to the border of Western Australia from the other States and Territories and seeking entry, s 67 will hinder interstate movement and, to that extent, discriminate against it. For the discrimination to occur in this connection it is not necessary that s 67 be seen to favour intrastate movement, as explained earlier in these reasons. But to the extent that s 67 discriminates against interstate movement by preventing it, the provision effects a burden on the freedom. The plaintiffs contended that the decision of this Court in Gratwick v Johnson77 applies to this case. They did not seek to rely upon the aspect of that decision which gave effect to a personal right to pass freely between the States. The plaintiffs did not contend for such a right in connection with the intercourse limb of s 92. They may be understood to submit that the EM Act provisions are not materially different from the regulations which were held to be invalid in Gratwick. The submission cannot be accepted. The regulations in Gratwick provided that no person should travel by rail or vehicle between the States without a permit. They were held to be directed against and a direct interference with freedom of intercourse among the States78. The regulations in Gratwick may readily be distinguished from the provisions of the EM Act, which have a purpose other than to restrict unauthorised movement. The restrictions they authorise are directed to the protection of the health of residents of Western Australia. (1945) 70 CLR 1. 78 Gratwick v Johnson (1945) 70 CLR 1 at 14 per Latham CJ, 16 per Rich J, 17 per Starke J, 19-20 per Dixon J, 22 per McTiernan J. It was not necessary for the Court in Gratwick to consider whether the law was necessary for a purpose other than to prevent interstate movement since none was suggested. Earlier authority had held that a State law which restricted interstate movement for other, legitimate reasons might be valid. In R v Smithers; Ex parte Benson79, Barton J, in describing the scope of the freedom assured to citizens by s 92, said that he should not be thought to say that it destroyed the right of States to take "any precautionary measure in respect of the intrusion from outside the State of persons who are or may be dangerous to its domestic order, its health, or its morals". And in Ex parte Nelson [No 1]80, which concerned prohibitions on the introduction of infected or contagious livestock into a State, it was said that whilst the establishment of freedom of trade between the States is a most notable achievement of the Constitution, it would be a strange result if that achievement had the effect of stripping the States of the power to protect their citizens from the dangers of infectious diseases, however those dangers might arise. Mason J's view of the measures in the North Eastern Dairy Co81 case may be seen to proceed from a similar viewpoint, although his Honour concluded they went further than was necessary for the purpose of protecting the public from contaminated milk. The plaintiffs accepted that if the purpose of the restrictions is held to be to prevent infectious diseases such as COVID-19 spreading into the Western Australian community, the question becomes one of justification. They then argued that it cannot be shown that the power to restrict the entry of persons into Western Australia is suitable or necessary to that purpose. The power to restrict should be capable of being adapted or lessened to accommodate the different levels of risk which persons seeking entry into the State might present. There can be no doubt that a law restricting the movement of persons into a State is suitable for the purpose of preventing persons infected with COVID-19 from bringing the disease into the community. Further, the matters necessary to be considered before such restrictions can be put in place, including with respect to an emergency declaration and the shortness of the period of an emergency declaration, suggest that these measures are a considered, proportionate response to an emergency such as an epidemic. The plaintiffs may be understood to contend that there is an alternative to a power of prohibition on persons from outside Western Australia entering the State. Entry could be allowed to persons from States where the disease is largely under control and who present a low risk of bringing it into the community. The (1912) 16 CLR 99 at 110. (1928) 42 CLR 209 at 218 per Knox CJ, Gavan Duffy and Starke JJ. (1975) 134 CLR 559 at 607-608, 616. underlying premise of this argument is that there is a level of risk which may be regarded as acceptable. This misapprehends Rangiah J's findings. His Honour did not suggest that a low risk of an infected person entering Western Australia was acceptable from a public health perspective. His Honour considered that once a person infected with COVID-19 enters the community there is a real risk of community transmission and that it may become uncontrollable. Because of the uncertainties about the level of risk and the severe, or even catastrophic, outcomes which might result from community transmission, a precautionary approach should be adopted. These findings leave little room for debate about effective alternatives. They provide no warrant for reading the power to prohibit entry into Western Australia during a pandemic down to accommodate some undefined level of risk. Accepting that s 67 must accommodate a requirement that it be exercised proportionately, the defendants' submission that there is no effective alternative to a general restriction on entry must be accepted. The defendants also submitted that once it is accepted that the purpose of the EM Act provisions is a legitimate, non-discriminatory purpose of protecting the public health of residents of Western Australia and that there are no other reasonable means available to achieve that purpose, it follows that they have established that the laws are adequate in the balance. This somewhat misstates the latter justification, proportionality in the strict sense. It requires that the importance of the public health purpose be measured against the extent of the restriction on the freedom. It must be accepted that the restrictions are severe but it cannot be denied that the importance of the protection of health and life amply justifies the severity of the measures. The same conclusions apply to the plaintiffs' case respecting interstate trade and commerce. The plaintiffs did not provide extensive written submissions on this alternative aspect of their case and did not further elaborate on them in oral argument. They did not rely upon evidence as to economic effects such as might be weighed against effects on health, assuming that is possible. The only additional matter that they raised respecting the laws so far as concerns interstate trade is that they have a protectionist purpose in the sense applicable to trade. That is clearly incorrect. Section 92 of the Constitution emphatically and imperatively declares that "trade, commerce, and intercourse among the States ... shall be absolutely free". The "riddle of s 92" lies in the question begged by the constitutional text: "absolutely free from what?"82 Cutting through the debris left by some 140 earlier failed judicial attempts to resolve that riddle, Cole v Whitfield83 provided a partial resolution. The partial resolution proceeded on the understanding that "[t]he notions of absolutely free trade and commerce and absolutely free intercourse are quite distinct and neither the history of [s 92] nor the ordinary meaning of its words require that the content of the guarantee of freedom of trade and commerce be seen as governing or governed by the content of the guarantee of freedom of intercourse"84. Cole v Whitfield authoritatively determined that trade and commerce among the States is guaranteed by s 92 to be absolutely free from "discriminatory burdens of a protectionist kind"85. The guarantee of the trade and commerce limb is of absolute freedom from laws imposing differential burdens on interstate trade or commerce (in comparison to intrastate trade or commerce) which cannot be justified as a constitutionally permissible means of pursuing constitutionally permissible non-discriminatory legislative ends and which operate to the competitive advantage of intrastate trade or commerce. Subsequent cases on the trade and commerce limb of the guarantee86 eventually settled on the standard to be met for a differential burden on interstate trade or commerce to be justified as a constitutionally permissible means of pursuing a non-discriminatory legislative 82 Wilcox Mofflin Ltd v New South Wales (1952) 85 CLR 488 at 539. (1988) 165 CLR 360. (1988) 165 CLR 360 at 388. (1988) 165 CLR 360 at 394, 398. See also at 407-408. 86 Bath v Alston Holdings Pty Ltd (1988) 165 CLR 411; Street v Queensland Bar Association (1989) 168 CLR 461; Castlemaine Tooheys Ltd v South Australia (1990) 169 CLR 436; Barley Marketing Board (NSW) v Norman (1990) 171 CLR 182; APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322; Betfair Pty Ltd v Western Australia (2008) 234 CLR 418 ("Betfair [No 1]"); Betfair Pty Ltd v Racing New South Wales (2012) 249 CLR 217 ("Betfair [No 2]"); Sportsbet Pty Ltd v New South Wales (2012) 249 CLR 298. end. The standard, authoritatively determined in Betfair Pty Ltd v Western Australia ("Betfair [No 1]"), is that of "reasonable necessity"87. What intercourse among the States is guaranteed by s 92 to be absolutely free from, Cole v Whitfield left to be resolved on another day. Left also for another day was the associated question of how the "intercourse limb" relates to the "trade and commerce limb" in respect of intercourse that occurs in trade or commerce. Subsequent cases touching on the intercourse limb88 have yielded no definitive answer. The occasion for resolution of that part of the riddle of s 92 left unresolved by Cole v Whitfield arose in the midst of a pandemic in the context of determining a proceeding brought by a resident of Queensland against the State of Western Australia, in the original jurisdiction conferred on the High Court by s 75(iv) and under s 76(i) of the Constitution, challenging directions contained in the Quarantine (Closing the Border) Directions (WA) ("the Directions") made under the Emergency Management Act 2005 (WA) ("the Act"). The Act, to the detail of which I will in due course turn, relevantly empowers the Western Australian Minister for Emergency Services to make and periodically renew a declaration that a state of emergency exists in an "emergency area", comprising the whole or any area or areas of Western Australia, in respect of the occurrence of a plague or epidemic of a nature that requires a significant and coordinated response89. For so long as a state of emergency declaration is in force, the Act empowers an authorised officer to give a general direction prohibiting movement of persons into or out of the declared emergency area for the purpose of combating the effects of the declared emergency90. On 15 March 2020, the Minister for Emergency Services made, and afterwards periodically renewed, a declaration that a state of emergency existed in (2008) 234 CLR 418 at 477 [102]-[103]. See also Betfair [No 2] (2012) 249 CLR 88 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106; Nationwide News Pty Ltd v Wills (1992) 177 CLR 1; Cunliffe v The Commonwealth (1994) 182 CLR 272; AMS v AIF (1999) 199 CLR 160; APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322. 89 Section 56 of the Act, read with the definitions of "emergency", "emergency area" and "hazard" in s 3 of the Act. 90 Section 67 of the Act, read with the definition of "emergency management" in s 3 of the Act. the whole of Western Australia in respect of "the pandemic caused by COVID- 19". For the express purpose of "limit[ing] the spread of COVID-19"91, the State Emergency Coordinator soon afterwards made, and then periodically revised, the Directions. The impugned directions were expressed to prohibit entry of persons into Western Australia92. On 6 November 2020, I joined in answering questions reserved in the proceeding for the consideration of the Full Court. The answer to the sole substantive question in which I then joined was to the effect that the provisions of the Act which authorised the making of directions of the kind impugned comply with both limbs of s 92 in all their potential applications. The consequence was that the validity of the impugned directions raised no constitutional question. The plaintiffs had disavowed any argument that the impugned directions were not authorised by the Act. The challenge to the impugned directions therefore failed. Now giving reasons for the decision I then reached, I proceed immediately to explain my reasoning on the substantive issues. The structure of my reasoning is as follows. At the outset, I deal with the resolution of that part of the riddle of s 92 left unresolved by Cole v Whitfield. I address what it means for intercourse among the States to be absolutely free: it means interstate intercourse must be absolutely free from discriminatory burdens of any kind. The guarantee of the intercourse limb is of absolute freedom from laws imposing differential burdens on interstate intercourse (in comparison to intrastate intercourse) which cannot be justified as a constitutionally permissible means of pursuing constitutionally permissible non- discriminatory legislative ends. I explain as well that the guarantees of absolute freedom of trade and commerce and absolute freedom of intercourse each apply to intercourse that occurs in trade or commerce. Next, I explain why compliance with the guarantees of absolute freedom of trade and commerce and absolute freedom of intercourse was appropriately determined by considering whether the provisions of the Act which authorise the making of directions of the kind impugned met the standard of reasonable necessity required to comply with both limbs of s 92 in all their potential applications, rather than by considering whether the impugned directions directly complied with that standard. Next, I turn to "structured proportionality". In short, I reject it. My view is that the standard to be met for a differential burden on interstate trade or commerce or on interstate intercourse to be justified as a constitutionally permissible means 91 Paragraph 1 of the Directions. 92 Paragraphs 4 and 5 of the Directions. of pursuing a constitutionally permissible non-discriminatory legislative end should remain the standard of reasonable necessity authoritatively determined in Betfair [No 1]. Finally, having established the parameters of what I consider to be the appropriate analysis, I explain quite briefly how the relevant provisions of the Act meet the requisite standard of constitutional justification. Interstate intercourse: absolutely free from what? The resolution of that part of the riddle of s 92 left unresolved by Cole v Whitfield was provided by Jeremy Kirk SC in an essay published on the eve of the onset of the pandemic93. The argument presented in the essay was an elaboration of an argument put by the Attorney-General of the Commonwealth intervening in Cole v Whitfield94. The argument was adopted by the Attorney-General of Queensland intervening in the present proceeding, and was ultimately accepted by the plaintiffs in reply. I am persuaded that the argument is sound. The argument, which I accept, is to the effect that intercourse among the States is guaranteed by s 92 to be absolutely free from all discriminatory burdens. The guarantee of the intercourse limb is of absolute freedom from laws imposing differential burdens on interstate intercourse (in comparison to intrastate intercourse) which cannot be justified as a constitutionally permissible means of pursuing non-discriminatory legislative ends. The standard to be met for a differential burden on interstate intercourse to be justified as a constitutionally permissible means of pursuing a non-discriminatory legislative end, no differently from the standard to be met for a differential burden on interstate trade or commerce to be justified as a constitutionally permissible means of pursuing a non- discriminatory legislative end, is the standard of reasonable necessity. Understood in that way, the guarantee of absolute freedom of interstate intercourse mirrors the guarantee of absolute freedom of interstate trade and commerce to the extent that: each invokes the same essential notion of discrimination as lying in "the unequal treatment of equals, and, conversely, in the equal treatment of unequals"95; each posits the same essential comparison between that which is interstate and that which is intrastate; each demands "an acceptable 93 Kirk, "Section 92 in its Second Century", in Griffiths and Stellios (eds), Current Issues in Australian Constitutional Law: Tributes to Professor Leslie Zines (2020) (1988) 165 CLR 360 at 368. 95 Castlemaine Tooheys Ltd v South Australia (1990) 169 CLR 436 at 480. explanation or justification for [any] differential treatment"96; and each imposes, as the measure of justification for differential treatment, satisfaction of the same standard of reasonable necessity. The guarantee of absolute freedom of interstate intercourse differs from the guarantee of absolute freedom of interstate trade and commerce only to the extent that absolute freedom of interstate intercourse extends to freedom from discriminatory burdens of any kind. That is to say, the guarantee of absolute freedom of interstate intercourse is infringed by any differential burden on interstate intercourse that cannot be justified. An unjustified differential burden on interstate intercourse need not operate to the competitive advantage of intrastate trade or commerce. That understanding of the intercourse limb fits comfortably with the imputed constitutional purpose of s 92 indicated by the pre-federation history expounded in Cole v Whitfield97 and elaborated in Betfair [No 1]98. The purpose was "to create a free trade area throughout the Commonwealth and to deny to Commonwealth and States alike a power to prevent or obstruct the free movement of people, goods and communications across State boundaries"99. The constitutional purpose derives from a structural imperative. Betfair [No 1] drew attention to the "apparent, albeit at times inconvenient, truth" that democratically elected legislatures in a political subdivision of a federal system have a structural incentive to "protect and promote the interests of their own constituents"100. The Constitution of the Commonwealth of Australia, like that of the United States, "was framed under the dominion of a political philosophy less parochial in range"101. 96 Castlemaine Tooheys Ltd v South Australia (1990) 169 CLR 436 at 477; Betfair [No 1] (2008) 234 CLR 418 at 478-480 [106]-[113]. (1988) 165 CLR 360 at 385-391. (2008) 234 CLR 418 at 454-459 [21]-[32]. (1988) 165 CLR 360 at 391. 100 (2008) 234 CLR 418 at 459-460 [34]-[35], quoting Tribe, American Constitutional Law, 3rd ed (2000), vol 1 at 1051-1052. 101 Betfair [No 1] (2008) 234 CLR 418 at 460 [35], quoting Baldwin v G A F Seelig Inc (1935) 294 US 511 at 523. By 1891, when the First National Australasian Convention, on the motion of Sir Henry Parkes, resolved principles "to establish and secure an enduring foundation for the structure of a federal government"102, the inconvenient truth of democratically elected legislatures in political subdivisions of a federal system having a structural incentive to protect and promote the interests of their own constituents had been demonstrated through long experience in the United States. There, forces of localism had repeatedly been experienced to result in State laws protecting in-State traders and producers against out-of-State traders and producers. The Supreme Court had repeatedly held State laws of that protectionist character to be within the purview of the freedom of trade guaranteed by the "dormant" operation of the "commerce clause"103, relevantly expressed to confer power on the United States Congress "[t]o regulate Commerce with foreign Nations, and among the several States"104. But much the same forces of localism had also been experienced to result in State laws prohibiting entry into a State by non-State citizens within categories considered to be undesirable105, taxing entry into a State by non-State citizens106, taxing citizens seeking to leave a State and taxing non-State citizens seeking simply to pass through a State107. Countering those forces in a non-commercial context, the Supreme Court had declared in 1867 that, independently of the dormant operation of the commerce clause, all citizens of the United States, "as members of the same community, must have the right to pass and repass through every part of it without interruption, as freely as in [their] own States"108. Of the principles proposed by Sir Henry Parkes, and that were later adopted by the First National Australasian Convention, the first was "[t]hat the powers and privileges and territorial rights of the several existing colonies shall remain intact, 102 Official Report of the National Australasian Convention Debates (Sydney), 4 March 103 Notably, Guy v Baltimore (1879) 100 US 434 and Minnesota v Barber (1890) 136 US 313, discussed in Betfair [No 1] (2008) 234 CLR 418 at 462-464 [42]-[47]. 104 United States Constitution, Art I, §8, cl 3. 105 New York v Miln (1837) 36 US 102. 106 The Passenger Cases (1849) 48 US 283. 107 Crandall v Nevada (1867) 73 US 35. 108 Crandall v Nevada (1867) 73 US 35 at 49, quoting The Passenger Cases (1849) 48 US 283 at 492. See Willoughby, The Constitutional Law of the United States, 2nd ed except in respect to such surrenders as may be agreed upon as necessary and incidental to the power and authority of the National Federal Government". The second, which necessarily qualified the first and which came to be embodied in s 92, was "[t]hat the trade and intercourse between the federated colonies ... shall be absolutely free"109. Speaking to the second of those principles, and of its centrality to the Australian federal project, Sir Henry Parkes said110: "By my next condition I seek to define what seems to me an absolutely necessary condition of anything like perfect federation, that is, that Australia, as Australia, shall be free − free on the borders, free everywhere − in its trade and intercourse between its own people; that there shall be no impediment of any kind − that there shall be no barrier of any kind between one section of the Australian people and another; but, that the trade and the general communication of these people shall flow on from one end of the continent to the other, with no one to stay its progress or to call it to account; in other words, if this is carried, it must necessarily take with it the shifting of the power of legislation on all fiscal questions from the local or provincial parliaments to the great national Parliament sought to be created. To my mind, it would be futile to talk of union if we keep up these causes of disunion. It is, indeed, quite apparent that time, and thought, and philosophy, and the knowledge of what other nations have done, have settled this question in that great country to which we must constantly look, the United States of America." As noted by Professor La Nauze111, the second principle was agreed to without discussion and "'absolutely free' was, to coin a phrase, absolutely free of legal criticism in open Convention". Understanding the intercourse limb of s 92 as a guarantee of absolute freedom from discriminatory burdens also fits well with Cole v Whitfield's reference to the intercourse limb extending to "a guarantee of personal freedom"112, 109 Official Report of the National Australasian Convention Debates (Sydney), 4 March 110 Official Report of the National Australasian Convention Debates (Sydney), 4 March 111 La Nauze, "A Little Bit of Lawyers' Language: The History of 'Absolutely Free', 1890-1900", in Martin (ed), Essays in Australian Federation (1969) 57 at 70-71. 112 (1988) 165 CLR 360 at 393. the content of which was indicated by Gratwick v Johnson, where the operation of s 92 was described as protecting against legislation "pointed directly at the passing of people to and fro among the States"113. That reference to personal freedom was plainly to freedom of movement of persons and cannot be taken to suggest the conferral of an individual right. The language used in Gratwick to describe the freedom was drawn from James v The Commonwealth114 which, as Cole v Whitfield went on to observe, employed a "notion of freedom as at the frontier" on one view little different from "the notion of freedom from burdens of a discriminatory kind"115. Gratwick usefully illustrates a differential burden on interstate intercourse which was not justified as a constitutionally permissible means of pursuing a constitutionally permissible non-discriminatory legislative end. Found wanting in that case was a statutory order purporting to prohibit interstate, but not intrastate, travel by rail or commercial passenger vehicle during a time of war. As put by Dixon J, the prohibition imposed by the statutory order was "simply based on the 'inter-Stateness' of the journeys it assume[d] to control"116. Although the statutory order was purportedly made pursuant to a statutory regime confining orders restricting movement to those in the interests of defence of the Commonwealth and effectual prosecution of the war, his Honour observed that it was "going a long way to suggest that the imperative demands of national safety necessitate a general prohibition operating in every part of the continent of travelling without a permit by public conveyance, but only if it is a journey with its terminus a quo in one State and its terminus ad quem in another State"117. Three other pre-Cole v Whitfield cases can be seen in retrospect as turning on the application of the intercourse limb of s 92. Each of them also serves as an example of a differential burden on interstate intercourse which, to comply with the guarantee of absolute freedom of interstate intercourse, needed to be justified as reasonably necessary to the pursuit of a non-discriminatory legislative end. 113 (1945) 70 CLR 1 at 17. See also at 14. 114 (1936) 55 CLR 1; [1936] AC 578. 115 (1988) 165 CLR 360 at 397. 116 (1945) 70 CLR 1 at 19. 117 (1945) 70 CLR 1 at 20. The earliest was R v Smithers; Ex parte Benson118. There, a law prohibited the "coming into" New South Wales of persons convicted of serious offences in other States. The law thereby imposed a differential burden on persons entering the State in comparison to persons having equivalent antecedents already in the State. The burden can be seen in retrospect to have been incapable of justification by reference to a standard of reasonable necessity. The burden was in fact sought to be justified on the basis that its imposition was a permissible means of pursuing the amorphous end of "the self-protection of the State"119. The reasoning of Griffith CJ120 and of Barton J121 directly picked up the approach of the Supreme Court of the United States to the implication of freedom of movement between States. Although the expression of their reasoning was redolent of an attitude towards constitutional interpretation now long rejected, their preparedness to recognise an implication along those lines underscores Sir Henry Parkes' emphasis on the criticality of freedom of interstate intercourse to the Australian federal system. Had it not been expressed, freedom of interstate intercourse under the Constitution would have had to have been implied. Higgins J, who like Isaacs J saw the case as turning solely on the application of s 92, said that the freedom of movement held by the Supreme Court of the United States to be implied in the Constitution of the United States "is expressed in sec 92 of our Constitution, so far as regards State boundaries"122. The other two cases, Ex parte Nelson [No 1]123 and Tasmania v Victoria124, both concerned State phytosanitary legislation empowering prohibition of importation into a State of animals or vegetables sourced from an area of another State affected by contagious diseases. In the first, a qualified prohibition of limited duration, during a period in which there existed "reason to believe" that a contagious disease existed, was held valid by a statutory majority. In the second, a blanket prohibition of unlimited duration was held invalid unanimously. 118 (1912) 16 CLR 99. 119 (1912) 16 CLR 99 at 104. 120 (1912) 16 CLR 99 at 108-109. 121 (1912) 16 CLR 99 at 109-110. 122 (1912) 16 CLR 99 at 119. 123 (1928) 42 CLR 209. 124 (1935) 52 CLR 157. After Cole v Whitfield, in Nationwide News Pty Ltd v Wills125, despite disavowing the proposition that discrimination is an "essential feature of an impermissible burden imposed on interstate intercourse"126, Brennan J in effect articulated an understanding of the intercourse limb as a guarantee of freedom from discriminatory burdens. His Honour explained that s 92 does not "purport to place interstate intercourse in a position where it is immune from the operation of laws of general application which are not aimed at interstate intercourse". He went on to describe the object of the section as being "to preclude the crossing of the border from attracting a burden which the transaction would not otherwise have to bear" as distinct from being "to remove a burden which the transaction would otherwise have to bear if there were no border crossing"127. That understanding of the intercourse limb as a guarantee of freedom from discriminatory burdens was applied by Brennan J in Nationwide News128 to hold that s 92 had nothing to say about a law of general application which burdened interstate political communication in precisely the same way as it burdened intrastate political communication, with the consequence that there was no need to consider whether the burden on interstate communication was justified in order to determine that the section was not infringed. In Cunliffe v The Commonwealth129, the same understanding was again applied by Brennan J130, as well as by Toohey J131, to hold that the intercourse limb had nothing to say about a law of general application which burdened interstate non-commercial communication in the same way as it burdened intrastate non-commercial communication, although Deane J132 (with whom Gaudron J expressed agreement133), Dawson J134, and 125 (1992) 177 CLR 1. 126 (1992) 177 CLR 1 at 57. 127 (1992) 177 CLR 1 at 58-59. 128 (1992) 177 CLR 1 at 60. 129 (1994) 182 CLR 272. 130 (1994) 182 CLR 272 at 333. 131 (1994) 182 CLR 272 at 384. 132 (1994) 182 CLR 272 at 346. 133 (1994) 182 CLR 272 at 392. 134 (1994) 182 CLR 272 at 366. McHugh J135 all proceeded explicitly or implicitly on the understanding that the intercourse limb, unlike the trade and commerce limb, was capable of being infringed by a law of general application. In AMS v AIF136, an issue arose about the application of the equivalent statutory guarantee of absolute freedom of trade, commerce and intercourse between a State and the Northern Territory137 to a differential burden on intercourse imposed by a judicial order made in an exercise of statutory discretion. The order had the practical effect of impeding the individual to whom it was directed moving from Perth to Darwin138. The question raised by the guarantee, which did not need to be answered because the judicial order was to be set aside on appeal for other reasons, was framed by Gleeson CJ, McHugh and Gummow JJ in terms of whether the impediment imposed was greater than that "reasonably required" to achieve the statutory objective139. The framing of the question in AMS in terms of whether a burden imposed on interstate intercourse was "reasonably required" to achieve the statutory objective, was subsequently adopted and applied by a majority in APLA Ltd v Legal Services Commissioner (NSW)140. Minor linguistic divergences aside, the "reasonably required" standard as then adopted and applied was indistinguishable in substance from the "reasonable necessity" standard settled upon in relation to the trade and commerce limb three years later in Betfair [No 1]. The standard was applied in APLA to legislative provisions which operated to burden interstate intercourse in the same way as they burdened intrastate intercourse. However, no argument was put in APLA that the burden on interstate intercourse did not need to be justified because the burden was not differential. Neither the outcome nor the reasoning therefore stands in the way of now recognising the intercourse limb to be confined to discriminatory burdens. 135 (1994) 182 CLR 272 at 396-397. 136 (1999) 199 CLR 160. 137 Section 49 of the Northern Territory (Self-Government) Act 1978 (Cth). 138 (1999) 199 CLR 160 at 179 [45]. 139 (1999) 199 CLR 160 at 179 [45]. See also at 233 [221]. 140 (2005) 224 CLR 322 at 353 [38], 393-394 [177], 461 [420]. See also at 481-482 By way of summation, the constitutional purpose of s 92 identified in Cole v Whitfield is best served by "re-integrating"141 its two limbs: by continuing to accept the trade and commerce limb as a guarantee that interstate trade and commerce is to be absolutely free from discriminatory burdens of a protectionist kind, and by recognising the intercourse limb as a guarantee that interstate intercourse is to be absolutely free from discriminatory burdens of any kind. Re- integration is supported by the reasoning of Brennan J in Nationwide News and by the reasoning of Brennan and Toohey JJ in Cunliffe, is consistent with the reasoning of Gleeson CJ, McHugh and Gummow JJ in AMS and is not prevented by the approach taken in the absence of contrary argument in APLA. Intercourse occurring in trade or commerce Re-integration brings complementarity. Recognising that each limb of s 92 of the Constitution guarantees freedom from discriminatory burdens, and that each limb demands the same standard of justification for a law imposing a differential burden, harmonises the operation of the two limbs in a manner that meets concerns expressed in Nationwide News142 and in APLA143 that each limb might have the potential to subsume the other. Each limb has a separate operation. In respect of intercourse occurring in trade or commerce, the two limbs overlap. To the extent they overlap, the guarantee of each must be observed. The result, in the language of Spigelman CJ in Cross v Barnes Towing and Salvage (Qld) Pty Ltd144, is that "a law which operates ... so that it regulates behaviour that may, but need not necessarily, be trade and commerce, will have to pass both tests". Compliance with both limbs will be required of a law which differentially burdens a form of interstate intercourse which occurs in trade or commerce or which may, but need not necessarily, occur in trade or commerce. The appropriate level of analysis Like the implied constitutional guarantee of freedom of political communication, the express constitutional guarantee of absolute freedom of trade, commerce and intercourse among the States is a limitation on Commonwealth, 141 Kirk, "Section 92 in its Second Century", in Griffiths and Stellios (eds), Current Issues in Australian Constitutional Law: Tributes to Professor Leslie Zines (2020) 142 (1992) 177 CLR 1 at 83-84. 143 (2005) 224 CLR 322 at 390-391 [162]-[165], 458 [408]. 144 (2005) 65 NSWLR 331 at 344 [44]. State and Territory executive power as much as it is a limitation on Commonwealth, State and Territory legislative power145. In respect of executive action which takes such legal force or effect as it may have only from legislation, however, the relevant operation of each constitutional guarantee is solely as a limitation on legislative power. The specifically relevant operation of each is as a limitation on the power to enact the legislation which purports to give the executive action legal force or effect. Where executive action purporting to be taken pursuant to statute imposes a burden argued to infringe the implied constitutional guarantee of freedom of political communication or the express constitutional guarantee of absolute freedom of trade, commerce and intercourse among the States, two distinct questions accordingly arise: one constitutional, the other statutory. The statutory question is whether the executive action is authorised by the statute. The constitutional question is whether the statute complies with the constitutional guarantee if, and insofar as, the statute authorises the executive action. Those two distinct questions arise in respect of the making of subordinate or delegated legislation in the same way as they arise in respect of any other executive action pursuant to statute. Our conception of subordinate legislation, as Dixon J explained in Victorian Stevedoring and General Contracting Co Pty Ltd and Meakes v Dignan146, is that it is wholly dependent for its force and effect on the enactment, and the continuing operation of the statute by which it is authorised. The distinction between the two questions has not been universally observed. The distinction was perhaps less apparent in theory and less workable in practice when judicial review of executive action undertaken in the exercise of discretionary powers conferred by statute was less developed147. Only in R v Toohey; Ex parte Northern Land Council148 was the position established that an exercise of statutory discretion by a vice-regal representative in ministerial council is reviewable on the basis that it exceeds the scope of statutory discretion or is 145 Cole v Whitfield (1988) 165 CLR 360 at 394, 409; Capital Duplicators Pty Ltd v Australian Capital Territory (1992) 177 CLR 248 at 275-276. 146 (1931) 46 CLR 73 at 101-102. 147 See Buck v Bavone (1976) 135 CLR 110 at 118-119, discussing Hughes and Vale Pty Ltd v New South Wales [No 2] (1955) 93 CLR 127; Miller v TCN Channel Nine Pty Ltd (1986) 161 CLR 556 at 614. 148 (1981) 151 CLR 170. See also FAI Insurances Ltd v Winneke (1982) 151 CLR 342 undertaken for a purpose not authorised by the statute. And only in Kirk v Industrial Court (NSW)149 was the position established that a State Supreme Court has constitutionally entrenched jurisdiction to remedy State executive action undertaken in excess of power conferred by State legislation. Even now, the statutory question can converge with the constitutional question in respect of executive action undertaken in the exercise of a discretionary power conferred by a statutory provision that is so broadly expressed as to require it to be read down as a matter of statutory construction to permit only those exercises of discretion that are within constitutional limits150. And even now, prudential considerations can favour framing the statutory question raised for determination on the facts of a case in a manner that minimally confines the scope of the constitutional question needing to be addressed151. The question whether a burden imposed through the exercise of a statutory discretion is justified across the range of potential outcomes of the exercise of that discretion might not yield a ready answer. The severable operation of the provision conferring the discretion in the event of non-compliance of some exercises of the discretion with the constitutional guarantee might be clear-cut. In that combination of circumstances, a court called upon to determine whether a legislative provision conferring the discretion complies with a constitutional guarantee to the extent that the provision purports to authorise particular discretionary executive action in issue might well proceed to answer the statutory and constitutional questions compendiously by focusing on the particular exercise of statutory discretion without embarking on a consideration of whether the provision conferring the discretion is compliant or non-compliant in all its applications. Thus, as Gummow J pointed out in APLA152 in the context of a challenge to subordinate legislation, there can still be cases in which the statutory and constitutional questions can be appropriately determined by melding them into a composite hypothetical question. If the subordinate legislation in issue had been 149 (2010) 239 CLR 531. 150 Miller v TCN Channel Nine Pty Ltd (1986) 161 CLR 556 at 613-614; APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 373 [104]; Wotton v Queensland (2012) 246 CLR 1 at 9-10 [10]; Betfair [No 2] (2012) 249 CLR 217 at 151 See Clubb v Edwards (2019) 267 CLR 171 at 192-193 [32]-[36], 216-217 [135]- 152 (2005) 224 CLR 322 at 373 [104], quoting O'Sullivan v Noarlunga Meat Ltd (1954) 92 CLR 565 at 594. enacted as legislation, would that legislation have been compliant with the constitutional guarantee in issue? The parties were content to adopt just that approach in the present case. Proceeding as if the Directions had been enacted as Western Australian legislation, and accepting the prohibition by the Directions of the entry of persons into Western Australia to impose a differential burden on interstate intercourse which might or might not be in trade or commerce, the parties joined issue on the factually intensive question of whether that prohibition could be justified at the time of the hearing as a constitutionally permissible means of pursuing the constitutionally permissible non-discriminatory legislative end of safeguarding the health of persons in Western Australia. The plaintiffs sought for that purpose to unpick and restitch the findings of fact made on remittal by Rangiah J153. The defendants sought to adopt, update and supplement his Honour's conclusions. The problem with conflating the statutory and constitutional questions in that manner, however, was that treating the Directions as if they had been enacted as Western Australian legislation failed to acknowledge the constitutional significance of critical constraints built into the scheme of the Act which sustained the Directions. The hypothetical analysis simplified the constitutional question to the point of obscuring the manner of its answer. Better in the circumstances of the case was to adopt the approach urged by the Attorney-General of Victoria, with the support of the Attorneys-General of Tasmania and Queensland, all of whom intervened in the proceeding, of squarely addressing the constitutional question at the level and in the manner indicated in Wotton v Queensland154 and applied there and in Comcare v Banerji155. The constitutional question so isolated was whether the provisions of the Act, insofar as they authorised the making of directions imposing a differential burden on interstate intercourse, are sufficiently constrained in their terms to allow a conclusion to be reached that imposition of a burden of that nature meets the requisite standard of justification across the range of potential outcomes. The answer to that constitutional question being in the affirmative for reasons to which I will eventually come, and no separate statutory question being 153 Palmer v Western Australia [No 4] [2020] FCA 1221. 154 (2012) 246 CLR 1 at 14 [22]. See also Stellios, "Marbury v Madison: Constitutional limitations and statutory discretions" (2016) 42 Australian Bar Review 324 at 335- 337, discussing Hogan v Hinch (2011) 243 CLR 506 and Wainohu v New South Wales (2011) 243 CLR 181. 155 (2019) 93 ALJR 900 at 915-916 [44], 924-925 [96]; 372 ALR 42 at 59, 72. raised in the proceeding as to whether the Directions complied with the Act, no further factual analysis was required in order to answer the principal question reserved. The requisite standard of justification Explained in Cole v Whitfield was that its re-interpretation of s 92 involved "a belated acknowledgment of the implications of the long-accepted perception that 'although the decision [whether an impugned law infringes s 92] was one for a court of law the problems were likely to be largely political, social or economic'"156. Foreseen was that the approach it ushered in would bring "a new array of questions in its wake"157 and give rise to "questions of fact and degree on which minds might legitimately differ"158. Further explained in Castlemaine Tooheys Ltd v South Australia was that "[t]he question whether a particular legislative enactment is a necessary or even a desirable solution to a particular problem is in large measure a political question best left for resolution to the political process" and that a court would be in an invidious position were it to hold "that only such regulation of interstate trade as is in fact necessary for the protection of the community is consistent with the freedom ordained by s 92"159. Drawing on a mode of analysis long adopted in the Supreme Court of the United States in relation to the dormant operation of the commerce clause, Castlemaine Tooheys addressed the question of whether there existed "an acceptable explanation or justification" for the differential burdening of interstate trade by the legislation in issue in that case by accepting that the legislature had "rational and legitimate grounds" for apprehending that the legislation imposing the differential burden contributed to the resolution of a legislatively identified problem. The manner in which the question was answered was by examining whether the legislative scheme imposing the differential burden was "appropriate and adapted" to the achievement of its legislative purpose such that incidental and not interstate disproportionate"160. Examined in that manner, the legislative scheme was found wanting because the burden it imposed on interstate trade was significantly greater the "burden imposed on trade was 156 (1988) 165 CLR 360 at 408, quoting Freightlines & Construction Holding Ltd v New South Wales (1967) 116 CLR 1 at 5; [1968] AC 625 at 667. 157 (1988) 165 CLR 360 at 408. 158 (1988) 165 CLR 360 at 409. 159 (1990) 169 CLR 436 at 473. 160 (1990) 169 CLR 436 at 473, 477. than that sufficient to achieve the legislative object161 and because it contained a wholly unexplained provision for exemption to be granted to intrastate traders162. Betfair [No 1] refined the standard of appropriateness and adaptedness referred to in Castlemaine Tooheys into one of reasonable necessity163. The measure of reasonable necessity, it was then said, "should be accepted as the doctrine of the Court"164. The significance of Betfair [No 1]'s refinement of Castlemaine Tooheys' standard of appropriateness and adaptedness into one of reasonable necessity needs to be understood against the background of the intervening formulation in Lange v Australian Broadcasting Corporation165, and refinement in Coleman v Power166, of the analytical framework for determining whether a law infringes the implied freedom of political communication. The Lange-Coleman analytical framework requires a law burdening political communication, whether differentially or not, to be justified as "reasonably appropriate and adapted" to the advancement of a legitimate purpose in a manner compatible with the maintenance of the constitutionally prescribed system of government. Lange had contained the following notation on terminology167: "Different formulae have been used by members of this Court in other cases to express the test whether the freedom provided by the Constitution has been infringed. Some judges have expressed the test as whether the law is reasonably appropriate and adapted to the fulfilment of a legitimate purpose. Others have including proportionality. In the context of the questions raised by the case stated, there is no need to distinguish these concepts. For ease of expression, favoured different expressions, 161 (1990) 169 CLR 436 at 474. 162 (1990) 169 CLR 436 at 475-476. 163 (2008) 234 CLR 418 at 477 [102]-[103]. 164 (2008) 234 CLR 418 at 477 [103]. 165 (1997) 189 CLR 520 at 567-568. 166 (2004) 220 CLR 1 at 51 [95]-[96], 77-78 [196], 82 [211]. 167 (1997) 189 CLR 520 at 562. throughout these reasons we have used the formulation of reasonably appropriate and adapted." Gleeson CJ had returned to the competing formulae in Mulholland v Australian Electoral Commission168: "Whichever expression is used, what is important is the substance of the idea it is intended to convey. Judicial review of legislative action, for the purpose of deciding whether it conforms to the limitations on power imposed by the Constitution, does not involve the substitution of the opinions of judges for those of legislators upon contestable issues of policy. When this Court declares legislation to be beyond power, or to infringe some freedom required by the Constitution to be respected, it applies an external standard. Individual judgments as to the application of that standard may differ, but differences of judicial opinion about the application of a constitutional standard do not imply that the Constitution means what judges want it to mean, or that the Constitution says what judges would prefer it to say." Gleeson CJ had observed that "[f]or a court to describe a law as reasonably appropriate and adapted to a legitimate end is to use a formula which is intended, among other things, to express the limits between legitimate judicial scrutiny, and illegitimate judicial encroachment upon an area of legislative power"169. His Honour had observed that "[t]he concept of proportionality has both the advantage that it is commonly used in other jurisdictions in similar fields of discourse, and the disadvantage that, in the course of such use, it has taken on elaborations that vary in content, and that may be imported sub silentio into a different context without explanation"170. Having treated appropriateness and adaptedness and proportionality as broadly equivalent expressions of the constitutional standard, however, Gleeson CJ had gone on in Mulholland to adopt the terminology of reasonable necessity as the appropriate expression of the measure of justification required of a law which targeted political communication, as distinct from a law of general application which merely burdened political communication in the same way as it burdened other communication. His Honour had explained the application of that more stringent measure "to involve close scrutiny, congruent with a search for 168 (2004) 220 CLR 181 at 197 [32]. 169 (2004) 220 CLR 181 at 197 [33]. 170 (2004) 220 CLR 181 at 197-198 [34]. See also Roach v Electoral Commissioner (2007) 233 CLR 162 at 178-179 [17]. 'compelling justification'"171. In a subsequent discussion in Thomas v Mowbray172, to which attention was drawn in Betfair [No 1]173, Gleeson CJ noted that "reasonable necessity" conveys a standard for the making of an evaluative judgment of a nature not uncommonly undertaken in the judicial process across a range of subject-matters. Reasonable necessity, it is important to recognise, expresses a standard that guides the making of an evaluative judgment as distinct from a test that substitutes for the making of an evaluative judgment. The standard cannot be reduced to the presence or absence of a single factor or of a predetermined range of factors. Justification of a burden by reference to the more general standard of appropriateness and adaptedness or proportionality being a matter of degree, reasonable necessity signifies that the requisite degree of justification is high. Correspondingly, reasonable necessity indicates a need for a heightened level of scrutiny. Against that background, the standard of reasonable necessity can be seen to have been adopted in Betfair [No 1], in preference to continuing with the more general expressions of appropriateness and adaptedness or proportionality, in order to convey the stringency of the scrutiny to be applied to determine the acceptability of a proffered justification for a differential burden on interstate trade or commerce. Then pointed out174 was that the heightened standard of reasonable necessity had in fact been met by the differential burden on interstate trade held to comply with the trade and commerce limb in Cole v Whitfield. Also pointed out175 was that the heightened standard had been applied by Mason J in North Eastern Dairy Co Ltd v Dairy Industry Authority of NSW176 to hold that the differential burden on interstate trade in that case had not been justified as "necessary for the protection of public health". 171 (2004) 220 CLR 181 at 200 [40], referring to Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 169 and Levy v Victoria (1997) 189 CLR 579 at 618. 172 (2007) 233 CLR 307 at 331-333 [20]-[26]. 173 (2008) 234 CLR 418 at 477 [102]. 174 (2008) 234 CLR 418 at 477 [103]. 175 (2008) 234 CLR 418 at 477 [102]. 176 (1975) 134 CLR 559 at 608. The standard of reasonable necessity so accepted for the purpose of s 92 as expressing the measure of justification demanded by the trade and commerce limb for a law imposing a differential burden on interstate trade or commerce, as I have already noted, equally expresses the measure of justification demanded by the intercourse limb for a law imposing a differential burden on interstate intercourse. The question to which I now turn is whether the standard of reasonable necessity should be supplemented or supplanted by structured proportionality of the kind imported as a "tool of analysis" or "test" for considering the application of the implied freedom of political communication in McCloy v New South Wales177. Here I am conscious of being drawn yet again into an abstracted debate about methodology more appropriate to the pages of a law review than to the pages of a law report. Over the years, I have followed the march of structured proportionality from its German homeland, first to South Africa, then to Canada, and then to other common law jurisdictions, before its entry into Australia in McCloy. I understand its attraction. I unreservedly share the aspiration of those who adhere to it to produce predictable outcomes through a transparent process of reasoning employing judicially manageable standards. Going further, I embrace the need to distinguish legislatively chosen means (what the law does) from legislatively chosen ends (what the law is designed to achieve) when applying any standard of justification in novel circumstances to determine whether a law infringes a constitutional guarantee. I embrace the need to consider how and to what extent the legislatively chosen means impact on the freedom protected by the constitutional guarantee. I embrace the need to consider the degree of connection between the legislatively chosen means and the legislatively chosen ends. I accept that, in so doing, there can often be utility in considering whether, and if so what, other means of achieving the same or similar ends might have a less drastic impact on the freedom protected by the constitutional guarantee. And I accept that need can arise to consider the systemic benefit of achieving the legislatively chosen ends relative to the systemic detriment caused by the impact of the legislatively chosen means on the freedom protected by the constitutional guarantee. All of that is to acknowledge the dimensions of the overall inquiry inherent in a novel application of the standard. I can even concede that there might be utility in attaching standardised labels to subsidiary inquiries indicated by those dimensions. To be clear, my concern structured proportionality ("Verhältnismäßigkeit"), of the kind translated and presented in tabular form in is with 177 (2015) 257 CLR 178 at 193-195 [2]-[3]. inquiries McCloy178, and of the kind which the Second Senate of the German Federal Constitutional Court recently castigated the European Court of Justice for failing to understand179. Structured proportionality commands the undertaking of consecutive "necessity" "suitability" ("Erforderlichkeit"), ("Zumutbarkeit") or "appropriateness" ("Angemessenheit"). Structured proportionality exhaustively defines, and in so doing confines, each of those standardised inquiries. Relevant considerations not captured within "suitability", as strictly defined, or "necessity", as strictly defined, are pushed down to be swept up in the residual inquiry into "adequacy of balance" or "appropriateness". "adequacy of balance" ("Geeignetheit"), into and Quite apart from my reservations about judicial importation of a tool of legal analysis forged in a different institutional setting within a different intellectual tradition and social and political milieu where it has been deployed for different purposes, my concern about structured proportionality as a tool of legal analysis, as I have sought to explain before180, is with its rigidity. Part of my concern is that the sequencing and linguistic precision of the standardised three-stage test tends to obscure the purpose for which the overall inquiry is undertaken. In consequence, it tends to lessen the sensitivity of the overall inquiry to the constitutional values which underlie the constitutional freedom protected by the constitutional guarantee at stake181. Oliver Wendell Holmes emphasised "the need of scrutinizing the reasons for the rules which we follow". "We must", as he put it, "think things not words, or at least we must constantly translate our words into the facts for which they stand, if we are to keep to the real and the true."182 178 (2015) 257 CLR 178 at 193-195 [2]. 179 Bundesverfassungsgericht [German Federal Constitutional Court], Judgment of the Second Senate of 5 May 2020, 2 BvR 859/15, 2 BvR 1651/15, 2 BvR 2006/15, 2 BvR 980/16. 180 McCloy v New South Wales (2015) 257 CLR 178 at 234-238 [140]-[149]; Murphy v Electoral Commissioner (2016) 261 CLR 28 at 71-73 [99]-[105]; Brown v Tasmania (2017) 261 CLR 328 at 376-377 [157]-[161]; Clubb v Edwards (2019) 267 CLR 171 at 224-225 [159]-[160]. 181 McCloy v New South Wales (2015) 257 CLR 178 at 235-238 [142]-[149]; Murphy v Electoral Commissioner (2016) 261 CLR 28 at 71-72 [99]-[101]. 182 Holmes, "Law in Science and Science in Law" (1899) 12 Harvard Law Review 443 Another part of my concern is that the limited scope of the analysis required and permitted at each stage of the standardised three-stage test tends to shape the overall inquiry in ways that actually work against the goal of producing predictable outcomes through a transparent process of reasoning. Factors having no, or little, bearing on the true inquiry thrown up by the facts and the law in a particular case that are required by the standardised verbal formulae to be considered in sequence end up receiving unwarranted analytical prominence. Factors bearing on the true inquiry thrown up by the facts and the law in a particular case that do not readily fit within any of the standardised verbal formulae end up suffering one or more of a number of possible fates. They get ignored or suppressed or downplayed. They get squeezed into one or more of the standardised verbal formulae in a manner that distorts the identification of the factors themselves or that distorts the language in which the formulae are expressed. Or they get accommodated through the creation of qualifications, which get patched onto, or carved out of, the standardised verbal formulae, creating rules upon rules183. Australian constitutional history has taught us, the hard way, that evaluative judgment is inescapable in constitutional adjudication and that no good can come of attempting to avoid it or unduly to canalise it. The natural judicial tendency to the creation of rules in the hope of generating predictable outcomes on constitutional issues of social and economic significance drove the adoption of both the "criterion of operation" doctrine formulated to govern application of s 92184 and the associated "criterion of liability" doctrine formulated to govern application of s 90 of the Constitution185. Both doctrines were shown through transparency but only experience confusion186. Both were ultimately discarded: the first in Cole v Whitfield, the second in Ha v New South Wales187. to produce neither predictability nor 183 Murphy v Electoral Commissioner (2016) 261 CLR 28 at 71-72 [98]-[101]. 184 Associated with Hospital Provident Fund Pty Ltd v Victoria (1953) 87 CLR 1. 185 Associated with Dennis Hotels Pty Ltd v Victoria (1960) 104 CLR 529 and Bolton v Madsen (1963) 110 CLR 264. 186 As to the confusion attending the criterion of liability doctrine of s 90, see: Philip Morris Ltd v Commissioner of Business Franchises (Vict) (1989) 167 CLR 399 at 429-433; Capital Duplicators Pty Ltd v Australian Capital Territory [No 2] (1993) 178 CLR 561 at 582-584. 187 (1997) 189 CLR 465. Of the criterion of operation doctrine, Cole v Whitfield noted that it "appeared to have the advantage of certainty, but that advantage proved to be illusory"188. Cole v Whitfield elaborated189: "In truth the history of the doctrine is an indication of the hazards of seeking certainty of operation of a constitutional guarantee through the medium of an artificial formula. Either the formula is consistently applied and subverts the substance of the guarantee; or an attempt is made to achieve uniformly satisfactory outcomes and its application." the formula becomes uncertain Writing extra-judicially at a time when the criterion of operation and criterion of liability doctrines were unravelling, Sir Kenneth Jacobs (in a passage to which I have drawn attention in the past190) stated191: "Linguistic refinement of concept (much less mere verbalisation) is no substitute for social reality; it can, indeed, result in fineness of distinction which makes it ever more difficult to predict a course of judicial decision. On the other hand, an overtly imprecise concept can yield a degree of certainty in application, provided the reasons for choice are also made as overt as we can. The test of reasonableness and unreasonableness may often yield more certainty than many rules of law couched in terms of apparent precision and decisiveness." After making the point that "[i]n the law of negligence the uncertain test of reasonableness gives much more predictability of outcome for a particular case than can be found when such a prediction must be based on some rules of law, in the conditions to which the games which lawyers play have reduced these rules", 188 (1988) 165 CLR 360 at 384. 189 (1988) 165 CLR 360 at 402. See also the discussion of Mansell v Beck (1956) 95 CLR 550 in Stellios, Zines's The High Court and The Constitution, 6th ed (2015) at 190 Clubb v Edwards (2019) 267 CLR 171 at 224 [159]. 191 Jacobs, "The Successor Books to 'The Province and Function of Law' – Lawyers' Reasonings: Some Extra-judicial Reflections" (1967) 5 Sydney Law Review 425 at 428, quoted in Stellios, Zines's The High Court and The Constitution, 6th ed (2015) "The law which seeks certainty in reasoning, which attends to verbal distinction while ignoring or affecting to ignore social reality, becomes truly uncertain in the sense that it becomes increasingly impossible to predict the course which decisions are likely to take. It is only as the area of choice becomes recognised and the factors operating to determine that choice are also then recognised, that one can feel any assurance upon the likely course of legal decision. This may not have been of such great importance in a society where the law-makers constituted by and large a single socially conscious group, as it surely is in the pluralist society which we now have." Since McCloy, structured proportionality has not come to dominate all facets of our constitutional analysis. It was treated as "inapposite" in determining whether electoral procedures were compatible with the constitutionally prescribed system of representative government in Murphy v Electoral Commissioner192. Its application to Ch III of the Constitution was rejected in Falzon v Minister for Immigration and Border Protection193. The present question is whether structured proportionality should now be incorporated into our analysis of the application of s 92. My answer is in the words of Sir Anthony Mason: "the Cole v Whitfield interpretation has brought an element of certainty and stability to a question which was a source of confusion over a long period of time. So why abandon that interpretation?"194 Nothing is broken; nothing should be fixed. The empowering provisions conform to the standard of reasonable necessity That brings me at last to explain how I came to form the evaluative judgment that the provisions of the Act which authorise the making of directions prohibiting movement of persons into Western Australia comply with the guarantee of each limb of s 92 in all their potential applications. My analysis began by looking to the legislatively identified end to be achieved by directions of that nature. The legislatively identified ends of the Act emerge from its interlocking statutory definitions of "emergency" and "hazard" 192 (2016) 261 CLR 28 at 53 [39]. See also at 94 [202]. 193 (2018) 262 CLR 333 at 343-344 [25]-[32]. 194 Mason, "Foreword", in Chordia, Proportionality in Australian Constitutional Law (2020) v at vi. See also Simpson, "Section 92 as a Transplant Recipient?", in Griffiths and Stellios (eds), Current Issues in Australian Constitutional Law: Tributes to Professor Leslie Zines (2020) 283 at 291-292. and "emergency management"195. The relevant end to emerge from those definitions is that of managing the adverse effects of a plague or epidemic of a nature that requires a significant and coordinated response. There being no contextual reason to doubt that legislative identification of the relevant legislative end, my analysis took me next to an examination of the means legislatively chosen to pursue that legislative end. The legislated means comprise two principal components. Each is hedged with constitutionally significant qualifications. The foundational component is the conferral of power on the Minister for Emergency Services to make a "state of emergency declaration": a declaration in writing to the effect that a state of emergency, constituted by the occurrence or imminent occurrence of a hazard (relevantly being a plague or epidemic) of a nature that requires a significant and coordinated response, exists in an "emergency area" which comprises the whole or any area or areas of Western Australia196. Reposing a power of that nature in a Minister reflects the reality that, within our constitutional system of representative and responsible government, at the State level as at the Commonwealth level, "[t]he Executive Government is the arm of government capable of and empowered to respond to a crisis"197. That ministerial power to make a state of emergency declaration is subject to two significant limitations. The first is a jurisdictional limitation to be found in the express and implied preconditions to the exercise of the power. The express preconditions are that the Minister has considered the advice of the State Emergency Coordinator198 (who has statutory responsibility for coordinating the response to an emergency during a state of emergency199), is "satisfied" that "an emergency has occurred, is occurring or that "extraordinary measures are required to prevent or minimise ... loss of life, ... or is further "satisfied" relevantly imminent"200, and 195 Section 3 of the Act. 196 Section 56(1) of the Act. 197 Pape v Federal Commissioner of Taxation (2009) 238 CLR 1 at 89 [233]. 198 Section 56(2)(a) of the Act. 199 Section 11(1) of the Act. 200 Section 56(2)(b) of the Act. harm to the health, of persons"201. Combined with the requirement for the state of emergency declaration to specify the emergency area within which the declared state of emergency exists, those preconditions operate to impose what has elsewhere been referred to as a "triple lock" of "seriousness, necessity and geographical proportionality"202 on the ministerial power to make a state of emergency declaration, each of the components of which is subject to judicial review. The requirement for the Minister to be "satisfied", both of the occurrence or imminence of an emergency and of the need for extraordinary measures to prevent or minimise loss of human life or harm to human health, requires that the Minister in fact form a state of mind that can be described as one of satisfaction and implies that the Minister must form the requisite state of mind reasonably and on a correct understanding of the Act203. To fulfil the condition of reasonableness, the state of mind formed by the Minister must be one that is open to be formed by a reasonable person in the position of the Minister on the basis of the information available to the Minister and must be one that is in fact formed by the Minister through an intelligible process of reasoning on the basis of that available information204. The second significant limitation is a temporal limitation on the legal effect of an exercise of the ministerial power. A state of emergency declaration has a finite duration. Unless sooner revoked by the Minister205, the declaration remains in force for an initial period of only three days206. Thereafter, the declaration can be extended and further extended by further ministerial declarations in writing but only for incremental periods each generally not exceeding 14 days207. Implicit in 201 Section 56(2)(c)(i) of the Act. 202 Lee, Adams, Campbell and Emerton, Emergency Powers in Australia, 2nd ed (2019) at 179, referring to Walker and Broderick, The Civil Contingencies Act 2004: Risk, Resilience, and the Law in the United Kingdom (2006) at 52, 72-73. 203 Graham v Minister for Immigration and Border Protection (2017) 263 CLR 1 at 30 204 ABT17 v Minister for Immigration and Border Protection (2020) 94 ALJR 928 at 936 [19]-[20]; 383 ALR 407 at 413. 205 Section 59 of the Act. 206 Section 57 of the Act. 207 Section 58 of the Act. the statutory scheme, as accepted by the defendants in argument, is that the ministerial power of extension is subject to the same preconditions as those that govern exercise of the power to declare an initial state of emergency. The power to give directions prohibiting movement of persons into, out of, or around an emergency area or part of an emergency area208 is one of a suite of emergency powers capable of being exercised only during such period as a declaration of a state of emergency remains in force209. The power is reposed in the State Emergency Coordinator or another officer authorised by the State Emergency Coordinator210. The power of direction is expressly limited to being exercised "[f]or the purpose of emergency management". "Emergency management" refers to management of the adverse effects of the declared emergency, including by way of preventing (including mitigating the probability of the occurrence of) or responding to (meaning combating the effect of) the declared emergency211. How far the authorised officer might choose to go to prevent or respond to the adverse effects of a declared emergency is not the subject of express statutory prescription. Nor is there a requirement that a particular direction prohibiting movement to be given must be (or must be considered by the authorised officer to be) the least restrictive means of preventing or responding to the adverse effects of the declared emergency to the chosen extent. No doubt, the discretion of the authorised officer could have been more tightly confined. But "[t]he reason why such a discretion is left at large is not hard to conjecture": it is that "legislative foresight cannot trust itself to formulate in advance standards that will prove apt and sufficient in all the infinite variety of facts which may present themselves"212. What is significant is that the purpose of emergency management is the sole purpose for which the power of direction can be exercised. And the discretion to exercise the power for that purpose is subject to the standard implied condition that 208 Section 67 of the Act. 209 Section 65 of the Act. 210 Sections 3 (definition of "authorised officer") and 61 of the Act. 211 Section 3 of the Act, definition of "emergency management". 212 Swan Hill Corporation v Bradbury (1937) 56 CLR 746 at 757. See also Miller v TCN Channel Nine Pty Ltd (1986) 161 CLR 556 at 613. it can only ever be exercised by the authorised officer reasonably on the basis of the information available to the authorised officer. The result is that, whilst the discretionary power of direction can extend to authorise the giving of a direction which on its face or in its practical effect imposes a differential burden on interstate intercourse (which might or might not be in trade or commerce), the power can only ever be exercised reasonably for the sole purpose of managing a designated emergency in a designated emergency area for so long as there is in force a state of emergency declaration, of the continuing need for which the Minister must periodically be stringently satisfied. My conclusion was, and remains, that the cumulation of those statutory constraints means that a differential burden on interstate intercourse that might result from an exercise of the power of direction is justified according to the requisite standard of reasonable necessity across the range of potential exercises of the power. Being justified, such a differential burden is not discriminatory. Much less is it protectionist. 167 GORDON J. The plaintiffs challenged the Quarantine (Closing the Border) Directions (WA) made by the State Emergency Coordinator213 under the Emergency Management Act 2005 (WA). The Directions prevented movement of most people into Western Australia from elsewhere (whether overseas or other parts of Australia). The Directions could not lawfully be made unless certain statutory conditions were met. A state of emergency had to be declared by the Minister for Emergency Services ("the Minister")214. The Minister could do that only if they had considered the advice of the State Emergency Coordinator215 and if satisfied that, relevantly, extraordinary measures were required to prevent or minimise loss of life, prejudice to the safety, or harm to the health, of persons216 from, in this case, an epidemic217. That declaration being in place, the State Emergency Coordinator had then to be satisfied that, for the management of the adverse effects of the epidemic (including mitigation or prevention of the potential adverse effects)218, the nature and magnitude of the epidemic required a significant and coordinated response219, which included, by direction, prohibiting the movement of most people into Western Australia220. The plaintiffs did not allege that these statutory conditions had not been met but did submit that paras 4 and 5 of the Directions infringed s 92 of the Constitution. On their proper construction, the provisions of the Act authorising the Directions comply with the constitutional limitation in s 92. Thus, the plaintiffs 213 The State Emergency Coordinator is an office held by the Commissioner of Police and, among other things, is responsible for "coordinating the response to an emergency during a state of emergency": Emergency Management Act, ss 10 and 214 Emergency Management Act, s 67, read with s 56. 215 Emergency Management Act, s 56(2)(a). 216 Emergency Management Act, s 56(2)(c)(i). 217 Emergency Management Act, s 56(2)(b), read with s 3 definitions of "emergency" and "hazard". Referred to by the Minister as a "pandemic" in the Declaration of State of Emergency dated 15 March 2020. 218 Emergency Management Act, s 3 definition of "emergency management". 219 Emergency Management Act, s 3 definition of "emergency". 220 Emergency Management Act, s 67. not alleging that the Directions were beyond the powers given by the Act, the plaintiffs' challenge failed. The factual background and procedural history, which I gratefully adopt, are set out in the reasons of Kiefel CJ and Keane J221. These are my reasons for joining in the answers given on 6 November 2020 to the questions stated for the opinion of the Full Court. The substantive question stated for the opinion of the Full Court raised two issues: the relationship between the two limbs of s 92 of the Constitution where an impugned law is said to infringe both limbs; and the analytical framework for assessing the plaintiffs' submission that the Directions infringed s 92, when the plaintiffs did not challenge the constitutional validity of the provisions of the Act under which the Directions were made and did not allege that the express statutory conditions for the exercise of the power to make the Directions had not been met. Before turning to those issues, it is necessary to address the Act. Emergency Management Act The Act provides for the "prompt and coordinated organisation of emergency management" in Western Australia222. It was common ground that ss 56 and 67 of the Act were the source of the power to make paras 4 and 5 of the Directions. Part 5 of the Act is headed "State of emergency". Within Div 1 of Pt 5, s 56(1) confers power on the Minister to "declare that a state of emergency exists in the whole or in any area or areas of the State". On 15 March 2020, four days after the World Health Organization declared COVID-19 to be a pandemic, the Minister declared a state of emergency over Western Australia in respect of the pandemic. The statutory conditions for the exercise of the power to declare a state of emergency are prescriptive and cumulative: the Minister must have considered the advice of the State Emergency Coordinator223; the Minister must be satisfied that an emergency has occurred, is occurring or is imminent224; and the Minister must be satisfied that extraordinary measures are required to prevent or minimise, 221 Reasons of Kiefel CJ and Keane J at [8]-[24]. 222 Emergency Management Act, long title. 223 Emergency Management Act, s 56(2)(a). 224 Emergency Management Act, s 56(2)(b). among other things, loss of life, prejudice to the safety, or harm to the health, of persons225. The term "emergency" is defined as "the occurrence or imminent occurrence of a hazard which is of such a nature or magnitude that it requires a significant and coordinated response"226 (emphasis added). The term "hazard" is in turn defined to include "a plague or an epidemic" and any other event, situation or condition that is capable of causing or resulting in loss of life, prejudice to the safety, or harm to the health, of persons227. And it is the hazard – the emergency – that has occurred, is occurring or is imminent in respect of which the Minister must be satisfied that extraordinary measures are required to prevent or minimise, among other things, loss of life, prejudice to the safety, or harm to the health, of persons, before the Minister can declare a state of emergency. The Minister's satisfaction as to these matters must be formed reasonably and on a correct understanding of the law228. In this case, but for the Minister being satisfied that an epidemic has occurred, is occurring or is imminent and that extraordinary measures are required to prevent or minimise loss of life, prejudice to the safety, or harm to the health, of persons, there could be no state of emergency declaration. And, of no less significance, any state of emergency declaration is of limited duration229. The initial state of emergency declaration remains in force for three days (unless sooner revoked)230 and then can only be extended by the Minister by further written declaration, relevantly, for a period that must not exceed 14 days231. Each time the state of emergency declaration is extended, the prescriptive and cumulative statutory conditions to the making of such a declaration must be satisfied. The powers that may be available if a state of emergency declaration is in force are addressed in Div 1 of Pt 6 of the Act, headed "Powers during emergency 225 Emergency Management Act, s 56(2)(c)(i). 226 Emergency Management Act, s 3 definition of "emergency". 227 Emergency Management Act, s 3 paras (d) and (f)(i) of the definition of "hazard". 228 See Graham v Minister for Immigration and Border Protection (2017) 263 CLR 1 229 Emergency Management Act, ss 57 and 58. 230 Emergency Management Act, s 57(b). 231 Emergency Management Act, s 58(1) and (4)(a). situation or state of emergency"232. Section 67(a) provides that, for the purpose of emergency management during a state of emergency233, an authorised officer234 may, among other things, "direct or, by direction, prohibit, the movement of persons ... within, into, out of or around an emergency area[235] or any part of the emergency area". The term "emergency management" is defined236 to mean: "the management of the adverse effects of an emergency including – prevention – the mitigation or prevention of the probability of the occurrence of, and the potential adverse effects of, an emergency; and preparedness – preparation for response to an emergency; and response – the combating of the effects of an emergency, provision of emergency assistance for casualties, reduction of further damage ... and recovery ...". The state of emergency took effect from midnight on 16 March 2020 and, pursuant to s 58 of the Act, every 14 days has been extended by the Minister. During the state of emergency, the State Emergency Coordinator issued the Directions, which were amended from time to time. At the time of the hearing before this Court, the Directions relevantly provided that "[a] person must not enter Western Australia unless the person is an exempt traveller"237 and that an exempt 232 Emergency Management Act, s 65. 233 Section 67 is also expressed to apply for the purpose of emergency management during an "emergency situation". Section 50 addresses the circumstances in which an emergency situation declaration may be made. The power in s 50 was not in issue in this matter. 234 Defined to mean the State Emergency Coordinator and a person authorised under s 61 of the Act: Emergency Management Act, s 3 definition of "authorised officer". 235 Defined to mean "the area to which an emergency situation declaration or a state of emergency declaration applies": Emergency Management Act, s 3 definition of "emergency area". 236 Emergency Management Act, s 3 definition of "emergency management". 237 Directions, para 4. At the time of the hearing before this Court, an exempt traveller was defined in para 27 as certain persons in the following classes: senior government traveller must not enter Western Australia if the person has certain COVID-19 symptoms, has been notified that they are a "close contact" of a person with COVID-19, is awaiting a test result after having been tested for COVID-19, or has received a positive test and has not received certification that they have recovered from COVID-19238. The preamble confirmed that "[t]he purpose of these directions is to limit the spread of COVID-19". That was consistent with the observation, in the paragraphs prior to the preamble, that the World Health Organization had declared COVID-19 a pandemic on 11 March 2020. Section 92 of the Constitution The difficulties that inhere in s 92 of the Constitution are longstanding239. A cause of the difficulties is that s 92 applies to the "diverse and changing nature" of interstate trade, commerce and intercourse240 and, thus, the principles applied in the decided cases have evolved from specific circumstances and features raising unique considerations241. This case is the next in line. It concerns steps taken by one State in response to the global pandemic of COVID-19. The steps taken were extraordinary (in effect closing Western Australia at its borders by generally preventing persons from entering the State). But the circumstances in which these steps were taken were extraordinary – a global pandemic that had killed many officials carrying out their duties; active Australian military personnel required to be on duty in Western Australia; members of the Commonwealth Parliament; persons carrying out functions under Commonwealth law; the Premier of Western Australia and members of their staff; persons requested to assist in the provision of health services in Western Australia; persons engaged in transport, freight and logistics into or out of Western Australia; persons who have specialist skills; "FIFO" employees who are not specialists and their families; emergency service workers; judicial officers and staff of courts, tribunals and commissions; and persons whose entry is otherwise approved on specified grounds. 238 Directions, para 5. 239 Cole v Whitfield (1988) 165 CLR 360 at 392. 240 Cole (1988) 165 CLR 360 at 383-385, 392. See also Betfair Pty Ltd v Western Australia ("Betfair No 1") (2008) 234 CLR 418 at 452-454 [12]-[20]. 241 See Gratwick v Johnson (1945) 70 CLR 1 at 19; Cole (1988) 165 CLR 360 at 393; AMS v AIF (1999) 199 CLR 160 at 178 [43]. people, where the vector of the pandemic was human and the disease could be transmitted by a person who was asymptomatic242. Despite the extraordinary circumstances giving rise to the extraordinary measures, the constitutional limitation of s 92 continues to apply and must be satisfied. Aspects of the guarantee in s 92 must frame the analysis. Section 92 does not confer a personal right to engage in interstate trade, commerce and intercourse243; it is a limit on legislative and executive power244. And the guarantee in s 92 that "trade, commerce, and intercourse among the States ... shall be absolutely free" does not confer immunity from all regulation245. It does not prevent the making of laws which impose a differential burden on interstate trade, commerce and intercourse if the differential burden is reasonably necessary to achieve a legitimate object of the law246. Interstate "trade, commerce, and intercourse" – composite or to be divided? Although this Court in Cole v Whitfield said that "[t]he notions of absolutely free trade and commerce and absolutely free intercourse are quite distinct"247 and that the content of one limb need not govern the content of the other248, 242 Palmer v Western Australia [No 4] [2020] FCA 1221 at [84], [88]-[89]. 243 Miller v TCN Channel Nine Pty Ltd (1986) 161 CLR 556 at 609-610; Cole (1988) 165 CLR 360; Betfair Pty Ltd v Racing New South Wales ("Betfair No 2") (2012) 249 CLR 217 at 266-267 [42]-[44]. 244 Cole (1988) 165 CLR 360 at 394; Australian Capital Television Pty Ltd v The Commonwealth ("ACTV") (1992) 177 CLR 106 at 150; Betfair No 2 (2012) 249 CLR 217 at 258 [14]. 245 Cole (1988) 165 CLR 360 at 394; Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 54, 58; ACTV (1992) 177 CLR 106 at 192-194; Cunliffe v The Commonwealth (1994) 182 CLR 272 at 307, 346, 395. 246 Cunliffe (1994) 182 CLR 272 at 366, 396; AMS (1999) 199 CLR 160 at 179 [45], 179-180 [48], 232-233 [221]; APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 353 [38], 393-394 [177], 461 [420]; Betfair No 1 (2008) 234 CLR 418 at 477 [102]; Betfair No 2 (2012) 249 CLR 217 at 269 [52], 295 [136]. 247 (1988) 165 CLR 360 at 388. 248 (1988) 165 CLR 360 at 387-388. See also Nationwide News (1992) 177 CLR 1 at 54-55, 82-83; ACTV (1992) 177 CLR 106 at 192; Cunliffe (1994) 182 CLR 272 at the phrase "trade, commerce, and intercourse" should be treated as a composite and not be divided. Cole and the cases since do not provide any compelling reason why the content of the trade and commerce limb and the content of the intercourse limb should be different. For the following reasons, it should now be accepted that s 92 is to be treated as a whole and is centrally concerned with discrimination – an unjustified differential burden249 on interstate trade, commerce and intercourse, compared with intrastate trade, commerce and intercourse. First, there is no textual basis for separating the components of s 92. As Hayne J said in APLA Ltd v Legal Services Commissioner (NSW)250, the text of s 92 does not readily yield a distinction between interstate trade and commerce, and interstate intercourse. Any distinction between the trade and commerce limb on one hand and the intercourse limb on the other can have purpose and utility only if it leads to different content being given to the freedom s 92 provides in relation to each limb251. As his Honour said, nothing in the text of s 92 reveals why that should be so and, in particular, nothing in the text readily reveals any basis for treating one of three elements of a composite expression which forms the subject of the guarantee as "connoting, let alone requiring, the application of some different test from the test to be applied to the other elements"252. Indeed, the phrase "trade, commerce, and intercourse among the States" is part of a constitutional guarantee concerned to protect the composite concept – interstate "trade, commerce, and intercourse". Impugned laws sometimes burden interstate trade and commerce and interstate intercourse253. So much was argued in this case. Second, considering the guarantee as a composite concept is consistent with the purpose of s 92, which is "to create a free trade area throughout the Commonwealth and to deny to [the] Commonwealth and States alike a power to prevent or obstruct the free movement of people, goods and communications 307, 346, 395; AMS (1999) 199 CLR 160 at 192 [98]; APLA (2005) 224 CLR 322 249 See Betfair No 1 (2008) 234 CLR 418 at 476 [101]; Betfair No 2 (2012) 249 CLR 250 (2005) 224 CLR 322 at 456-457 [401]-[402]. 251 APLA (2005) 224 CLR 322 at 456 [401]. 252 APLA (2005) 224 CLR 322 at 456-457 [402]. 253 See, eg, Nationwide News (1992) 177 CLR 1 at 54-55, 59; APLA (2005) 224 CLR across State boundaries"254. To accept that s 92 protects interstate trade, commerce and intercourse from laws which discriminate against – impose an unjustified differential burden on – interstate trade, commerce and intercourse, thus accords with its purpose. As has rightly been said in relation to interstate intercourse255: "That purpose does not require that the guarantee apply to general laws which do not seek to employ State borders as a barrier to free movement ... Section 92 should be understood not so much as a guarantee of freedom of movement per se, but as a restriction on using State borders to keep outsiders out, or keep insiders in. It is that which is offensive to the federal nation." Put in different terms, a discriminatory element – an unjustified differential burden on interstate trade, commerce and intercourse, compared with intrastate trade, commerce and intercourse – is what underpins s 92. The "essence of the legal notion of discrimination" is in "the unequal treatment of equals, and, conversely, in the equal treatment of unequals"256, or "a departure from equality of treatment"257. It may be accepted that the nature of the discrimination differs between the two limbs. For trade and commerce, the discrimination is protectionist, namely the "protection of domestic [intrastate] industries against foreign [interstate] competition"258. For intercourse, the discrimination is between intrastate as distinct from interstate movement or activity. Although the nature of the discrimination may differ, that does not detract from the fact that discrimination must exist and create an unjustified differential burden in favour of intrastate – as distinct from interstate – trade, commerce and intercourse. Third, recognising that the concern of the guarantee is to protect against laws which impose an unjustified differential burden on interstate trade, commerce and intercourse in favour of intrastate trade, commerce and intercourse is no new idea. It has long been accepted that laws infringing the guarantee of free 254 Cole (1988) 165 CLR 360 at 391. See also Nationwide News (1992) 177 CLR 1 at 255 Kirk, "Section 92 in its Second Century", in Griffiths and Stellios (eds), Current Issues in Australian Constitutional Law: Tributes to Professor Leslie Zines 256 Castlemaine Tooheys Ltd v South Australia (1990) 169 CLR 436 at 480. 257 Cole (1988) 165 CLR 360 at 399. 258 Betfair No 1 (2008) 234 CLR 418 at 455-456 [24], quoting Cole (1988) 165 CLR 360 at 392-393. See also Cole (1988) 165 CLR 360 at 408. interstate trade and commerce are those that discriminate (in a protectionist sense) against interstate trade and commerce, in favour of intrastate trade and commerce259. But the discriminatory element has also featured in intercourse cases. As Brennan J said in Nationwide News Pty Ltd v Wills, "discrimination against interstate intercourse of a particular kind and in favour of intrastate intercourse of a like kind would be a badge of invalidity"260. In Cunliffe v The Commonwealth261, Toohey J recognised that s 92 was also concerned with protecting interstate intercourse from laws which discriminate against it in favour of intrastate intercourse. His Honour rejected a submission that freedom of interstate intercourse could be impaired "by a law of general application, that is, a law which applies indifferently to communications regardless of whether they are intrastate or interstate communications" (emphasis added)262. And, as has been observed, what is offensive to the federal nation, recognised in s 92, is an unjustified differential burden imposed by a law which extends to "using State borders to keep outsiders out, or keep insiders in"263. Fourth, if the intercourse limb of the guarantee is not concerned with differential burdens, then the intercourse limb may be too broad. It could undermine the limited scope of the trade and commerce limb264. Thus, unless the intercourse limb of s 92 is confined to laws which impose differential burdens on 259 See, eg, North Eastern Dairy Co Ltd v Dairy Industry Authority of NSW (1975) 134 CLR 559 at 608; Cole (1988) 165 CLR 360 at 394, 398, 407-408; Castlemaine Tooheys (1990) 169 CLR 436 at 465-467; Betfair No 1 (2008) 234 CLR 418 at 481 [118], [121], 482 [122]; Betfair No 2 (2012) 249 CLR 217 at 260 (1992) 177 CLR 1 at 57; see also 58-59. However, Brennan J held that "discrimination is not an essential feature of an impermissible burden imposed on interstate intercourse": at 57. See also Cunliffe (1994) 182 CLR 272 at 333. 261 (1994) 182 CLR 272. 262 Cunliffe (1994) 182 CLR 272 at 384. 263 Kirk, "Section 92 in its Second Century", in Griffiths and Stellios (eds), Current Issues in Australian Constitutional Law: Tributes to Professor Leslie Zines 264 Cole (1988) 165 CLR 360 at 408. See Kirk, "Section 92 in its Second Century", in Griffiths and Stellios (eds), Current Issues in Australian Constitutional Law: Tributes to Professor Leslie Zines (2020) 253 at 253-254, 270, 275-277. interstate intercourse, a law which does not impose a differential burden on interstate trade, commerce or intercourse would not burden the trade and commerce limb, yet it might burden the intercourse limb if it restricts movement across a border. Similarly, if the intercourse limb is not confined to differential burdens, it could also give greater protection than is required, for the purpose of s 92, to interstate intercourse compared with intrastate intercourse. Laws that restrict both interstate and intrastate intercourse (and do not impose a differential burden on interstate intercourse as compared with intrastate intercourse) may be held to burden interstate intercourse but not intrastate intercourse, thereby privileging interstate over intrastate movement265. That would go beyond s 92's purpose of preventing State borders from being used as barriers to trade, commerce and federal nation266. intercourse Thus, as foreshadowed, in the context of the constitutional guarantee in s 92, the burden on interstate trade, commerce and intercourse must be a differential one. in a manner is offensive that the And, as has long been established, the unjustified differential burden, the discriminatory burden, can arise from the legal operation as well as the practical operation of the law267. Where the impugned law arguably burdens both limbs of s 92, it is necessary for the law to satisfy both limbs. The trade and commerce limb does not prevail268. Neither limb subsumes the other. To the extent that earlier decisions of this Court hold otherwise269, they no longer reflect the law on s 92. Section 92 analysis The first step is to ask whether the impugned law, in its legal or practical operation, imposes a differential burden on interstate trade, commerce or intercourse in favour of intrastate trade, commerce or intercourse. If there is no 265 Kirk, "Section 92 in its Second Century", in Griffiths and Stellios (eds), Current Issues in Australian Constitutional Law: Tributes to Professor Leslie Zines 266 See [183] above. 267 Cole (1988) 165 CLR 360 at 399-400, 407-408. 268 See Cross v Barnes Towing and Salvage (Qld) Pty Ltd (2005) 65 NSWLR 331 at 344 [44]. cf APLA (2005) 224 CLR 322 at 353-354 [39], 390-391 [165], 458 [408]. 269 See, eg, Cole (1988) 165 CLR 360 at 387-388; ACTV (1992) 177 CLR 106 at 192; Cunliffe (1994) 182 CLR 272 at 346, 395. such differential burden, that is the end of the inquiry and the law does not infringe the constitutional guarantee in s 92. Where, however, the law does impose a differential burden of that kind on interstate trade, commerce or intercourse, it is necessary to identify the law's object or objects. That entails "an objective inquiry answered by reference to the meaning of the law or to its effect"270. The inquiry resembles that used "when seeking to identify the mischief to redress of which a law is directed or when speaking of 'the objects of the legislation'"271. It is a search for "what the law is designed to achieve in fact"272. The object or purpose of the law is not merely relevant, it is "the crucial determinant of validity"273. If the only object of the law is to erect State borders as barriers against freedom of trade, commerce or intercourse, that will be the end of the inquiry274. Without more, the law is discriminatory; it will infringe the constitutional guarantee in s 92 and be invalid. But where the law has a legitimate object, the question then is whether the differential burden imposed by that law is justified275. The test of justification applied in the past, to which reference has been made, and which continues to apply, is whether the differential burden imposed by the impugned law is reasonably necessary to achieve a legitimate object of that law276 or, in other words, 270 APLA (2005) 224 CLR 322 at 394 [178], citing Nationwide News (1992) 177 CLR 271 APLA (2005) 224 CLR 322 at 394 [178]. See also Brown v Tasmania (2017) 261 CLR 328 at 363 [101], 392 [208], 432 [321]. 272 McCloy v New South Wales (2015) 257 CLR 178 at 232 [132], citing APLA (2005) 224 CLR 322 at 394 [178]. 273 ACTV (1992) 177 CLR 106 at 195. See also Nationwide News (1992) 177 CLR 1 at 274 See ACTV (1992) 177 CLR 106 at 194; Cunliffe (1994) 182 CLR 272 at 366. See also R v Smithers; Ex parte Benson (1912) 16 CLR 99; Gratwick (1945) 70 CLR 1, especially at 14-15, 16, 19. 275 Cole (1988) 165 CLR 360 at 408; Castlemaine Tooheys (1990) 169 CLR 436 at 467, 471; APLA (2005) 224 CLR 322 at 394 [178]; Betfair No 2 (2012) 249 CLR 217 at 276 See fn 246 above. whether it constitutes reasonable regulation277. If yes, the constitutional guarantee in s 92 will not be infringed; if no, it will be infringed. The idea of "reasonable regulation" has been approved by this Court in relation to both intercourse and trade and commerce. As to the former, the Court has asked whether the burden on interstate intercourse is greater than "reasonably required" to achieve a legitimate object of the legislation in Cunliffe278, AMS v AIF279 and APLA280. In relation to trade and commerce, the Court has asked whether the burden on trade and commerce is "reasonably necessary" to achieve a legitimate non-protectionist purpose in Betfair Pty Ltd v Western Australia ("Betfair No 1")281 and Betfair Pty Ltd v Racing New South Wales ("Betfair No 2")282. A similar approach had previously been taken in North Eastern Dairy Co Ltd v Dairy Industry Authority of NSW283 and Cole284. For the purposes of s 92, there is no difference of substance between "reasonably required" and "reasonably the "reasonably necessary" formulation, which was most recently approved in Betfair necessary", convenient adopt and 277 AMS (1999) 199 CLR 160 at 178 [43] (citing The Commonwealth v Bank of NSW ("the Bank Nationalization Case") (1949) 79 CLR 497 at 639-641; [1950] AC 235 at 309-311); Betfair No 1 (2008) 234 CLR 418 at 477 [102] (quoting North Eastern Dairy (1975) 134 CLR 559 at 608), 477 [103] (quoting Cole (1988) 165 CLR 360 278 (1994) 182 CLR 272 at 366; cf 396. 279 (1999) 199 CLR 160 at 179 [45], 179-180 [48], 232-233 [221]. 280 (2005) 224 CLR 322 at 353 [38], 393-394 [177], 461 [420]. 281 (2008) 234 CLR 418 at 477 [102]-[103], where the majority of the Court endorsed the application "of a criterion of 'reasonable necessity'". 282 (2012) 249 CLR 217 at 269 [52], 295 [136]. 283 (1975) 134 CLR 559 at 608. 284 (1988) 165 CLR 360 at 409-410. No 1285 and Betfair No 2286, and has been used in various constitutional and other legal contexts287. The need for some "reservation" on the absolute nature of the guarantee of "free" trade, commerce and intercourse in s 92 was explained by the Privy Council in The Commonwealth v Bank of NSW ("the Bank Nationalization Case")288. As their Lordships stated289: "Every case must be judged on its own facts and in its own setting of time and circumstance, and it may be that in regard to some economic activities and at some stage of social development it might be maintained that prohibition with a view to State monopoly was the only practical and reasonable manner of regulation and that inter-State trade commerce and intercourse thus prohibited and thus monopolized remained absolutely free." (emphasis added) Recognising that there are limits to the freedom in s 92 does not "involve inconsistency with the words 'absolutely free': it is simply to identify the kinds or classes of burdens, restrictions, controls and standards from which the section guarantees absolute freedom"290. As the Privy Council observed, and the history of the cases concerning s 92 have demonstrated time and time again, the "reservation"291 on the absolute nature of the constitutional guarantee in s 92 was, and remains, necessary to meet societal changes and the impact of those changes on interstate trade, commerce and intercourse. And the societal changes are ever-increasing in their complexity and varied in their nature292. They are multi-faceted, concern multiple disciplines and are not limited by the physical area of a State or nation. 285 (2008) 234 CLR 418 at 477 [102]-[103]. 286 (2012) 249 CLR 217 at 269 [52], 295 [136]. 287 See Thomas v Mowbray (2007) 233 CLR 307 at 331-333 [21]-[26]. 288 (1949) 79 CLR 497 at 640; [1950] AC 235 at 311. 289 Bank Nationalization Case (1949) 79 CLR 497 at 640-641; [1950] AC 235 at 311. 290 Cole (1988) 165 CLR 360 at 394. 291 Bank Nationalization Case (1949) 79 CLR 497 at 640; [1950] AC 235 at 311. 292 See, eg, Betfair No 1 (2008) 234 CLR 418 at 452-454 [12]-[20]. But the reservation is not at large. The application of the limits is governed by the objects of the impugned law293 and the test of reasonable necessity becomes one which, at least in large measure, is self-defining in its operation294. As the Court said in Cole295 in relation to trade or commerce: "if a law, which may be otherwise justified by reference to an object which is not protectionist, discriminates against interstate trade or commerce in pursuit of that object in a way or to an extent which warrants characterization of the law as protectionist, a court will be justified in concluding that it nonetheless offends s 92." Asking whether a differential burden on interstate trade, commerce or intercourse is reasonably necessary to achieve an object of the law is directed to determining whether the law is properly characterised as discriminating against interstate trade, commerce or intercourse compared with intrastate trade, commerce or intercourse. For both limbs, there is an inquiry into whether the impugned law may be characterised as "relevantly discriminatory"296. For both limbs, the question of validity is binary: whether or not a restriction on trade, commerce or intercourse transgresses the freedom297. For both limbs, the answer to that binary question depends on the objects of the impugned law and whether the differential burden imposed is reasonably necessary to achieve a legitimate object – an object other than imposing a differential burden on interstate trade, commerce or intercourse in favour of intrastate trade, commerce or intercourse. Or, to adopt the language used in Castlemaine Tooheys Ltd v South Australia298, the inquiry is whether the true purpose of the law, in its legal and practical operation, is to achieve a legitimate object or to effect a form of prohibited discrimination. 293 APLA (2005) 224 CLR 322 at 461 [422]. 294 APLA (2005) 224 CLR 322 at 462 [425]. 295 (1988) 165 CLR 360 at 408, quoted in Castlemaine Tooheys (1990) 169 CLR 436 296 See Castlemaine Tooheys (1990) 169 CLR 436 at 472. 297 See Chordia, Proportionality in Australian Constitutional Law (2020) at 143, 298 (1990) 169 CLR 436 at 472. cf ACTV (1992) 177 CLR 106 at 143-144; Cunliffe (1994) 182 CLR 272 at 324, 352, 388. Those inquiries are not assisted by adopting structured proportionality as a tool of analysis. It is unnecessary to repeat the concerns expressed elsewhere about the rigidity of structured proportionality or the validity of the reasons proffered for adopting it299. Those concerns are no less real in the context of s 92. If a law imposes a differential burden on interstate trade, commerce or intercourse and a legitimate purpose of the law is identified, to then ask whether there are compelling alternative, reasonably practicable means of achieving that legitimate purpose which impose a lesser burden, is to ask a question the content of which depends on what is meant by "compelling" and "reasonably practicable means". The absence of alternative means may suggest that the purpose of the law is in truth to achieve the legitimate purpose alleged300. But, the existence of alternative means cannot be conclusive because the test for s 92 is one of characterisation – is the differential burden imposed by the impugned law reasonably necessary to achieve a legitimate object of that law? To treat the existence of alternative means as conclusive that s 92 is infringed, in every case, would be an approach that is too rigid and prescriptive301. It would fail to accommodate the specific circumstances and features of the trade, commerce or intercourse in issue. It would ignore the injunction that in questions concerning the application of s 92, the Court should "in each case ... decide the matter, so far as may be, on the specific considerations or features which it presents"302. And, there will be cases where an inquiry into the existence of alternative means will simply not be possible – for example, where the impugned provisions are part of a complex legislative scheme and there is no ready comparator303 or, as in this case, where an inquiry into the existence of alternative 299 McCloy (2015) 257 CLR 178 at 281-282 [308]-[311]; see also 222 [98], 234-238 [140]-[150]; Murphy v Electoral Commissioner (2016) 261 CLR 28 at 122-124 [294]-[305]; see also 72 [101]; Brown (2017) 261 CLR 328 at 464-468 [427]-[438]; see also 376-379 [159]-[165]; Clubb v Edwards (2019) 267 CLR 171 at 304-310 [389]-[404]; see also 224-225 [159]-[160]. 300 See Castlemaine Tooheys (1990) 169 CLR 436 at 472. cf Betfair No 1 (2008) 234 CLR 418 at 479-480 [110]-[112]. 301 See Murphy (2016) 261 CLR 28 at 122-123 [298]-[299]; Brown (2017) 261 CLR 302 Gratwick (1945) 70 CLR 1 at 19. 303 cf Murphy (2016) 261 CLR 28 at 123 [303]. See also Clubb (2019) 267 CLR 171 at means would be futile304. In the context of s 92, there can be no "one size fits all" approach305. Second, to require the balancing stage of structured proportionality as an additional step of analysis for s 92 would be to introduce a new element that would be contrary to the foundations and current operation of s 92. As explained, the freedom in s 92 is absolute but subject to a reservation306. Determining whether s 92 has been infringed involves an inquiry about the objects of the impugned law. The balancing stage of structured proportionality is not only concerned with identifying the objects of the impugned law307. Rather, the balancing stage of structured proportionality requires "a value judgment, consistently with the limits of the judicial function, describing the balance between the importance of the purpose served by the restrictive measure and the extent of the restriction it imposes on the freedom"308. Section 92 neither permits nor requires this further inquiry. Adopting and adapting what was said in Castlemaine Tooheys, "there is no place for a secondary test to invalidate laws which have been found to lack a [discriminatory] purpose or effect. Rather, the two tests are combined as one inquiry into the characterization of the law as [discriminatory] or otherwise"309. And a secondary test – the balancing stage of structured proportionality – would introduce a degree of values-based decision making that s 92 not only can avoid310, but must. The Court is often not well-placed to make such value 304 See [208] below. 305 See, eg, McCloy (2015) 257 CLR 178 at 235 [142]; Brown (2017) 261 CLR 328 at 306 Bank Nationalization Case (1949) 79 CLR 497 at 640; [1950] AC 235 at 311. See also Cole (1988) 165 CLR 360 at 394; Nationwide News (1992) 177 CLR 1 at 54, 58; ACTV (1992) 177 CLR 106 at 192-194; Cunliffe (1994) 182 CLR 272 at 307, 307 McCloy (2015) 257 CLR 178 at 219 [87]. 308 McCloy (2015) 257 CLR 178 at 195 [2], 218-219 [83]-[87]. 309 (1990) 169 CLR 436 at 471. 310 See Chordia, Proportionality in Australian Constitutional Law (2020) at 143, 149, judgments where the nature of trade, commerce and intercourse is complex, multi- faceted and evolving311. Analytical framework for s 92 challenge As explained, the plaintiffs did not challenge the constitutional validity of s 56 or s 67 of the Act, or allege that the express statutory conditions for the exercise of the power to make the state of emergency declaration under s 56312 or the Directions under s 67 had not been met. The plaintiffs submitted that the putative burden on the freedom guaranteed by s 92 arose because of the Directions. As a majority of this Court held in Wotton v Queensland313, "if, on its proper construction, the statute complies with the constitutional limitation, without any need to read it down to save its validity, any complaint respecting the exercise of power thereunder in a given case ... does not raise a constitutional question, as distinct from a question of the exercise of statutory power". That approach had earlier been taken by Brennan J in Miller v TCN Channel Nine Pty Ltd314 and has subsequently been applied in Comcare v Banerji315. It is correct in principle because it reflects that a discretion conferred by statute "must be exercised by the repository of a power in accordance with any applicable law, including s 92"316. As Victoria submitted, here, the putative burden "has its source in statute"317 and its source is necessarily subject to the s 92 "limitation upon legislative power"318. Thus, the question is whether, on their proper construction, ss 56 and 67 of the Act comply with the constitutional limitation of s 92, without any need to read 311 See, eg, Betfair No 1 (2008) 234 CLR 418 at 452-454 [12]-[20]. 312 Or to extend the state of emergency declaration: see [175] above. 313 (2012) 246 CLR 1 at 14 [22]. 314 (1986) 161 CLR 556 at 607, 611, 614. See also AMS (1999) 199 CLR 160 at 176 315 (2019) 93 ALJR 900 at 916 [44], 924-925 [96], 945-946 [209]-[210]; 372 ALR 42 316 Miller (1986) 161 CLR 556 at 613-614. 317 Wotton (2012) 246 CLR 1 at 14 [22]. 318 Wotton (2012) 246 CLR 1 at 14 [22]. the Act down to save its validity in its application to the case at hand319. Put differently, do those sections, by their terms, confer a power that "is so constrained that its exercise cannot be obnoxious to the freedom guaranteed by s 92"320. The answer is yes. Validity of ss 56 and 67 of the Emergency Management Act The first question is whether ss 56 and 67 of the Act impose a differential burden on the freedom of interstate trade, commerce or intercourse. By itself, s 56 could not burden interstate trade, commerce or intercourse as it only deals with the Minister's power to make a state of emergency declaration, not the consequences or effect of any declaration. However, an exercise of the power under s 67(a) could burden interstate trade, commerce or intercourse given that it permits the making of a direction prohibiting "the movement of persons, animals and vehicles within, into, out of or around an emergency area or any part of the emergency area". If the emergency area is adjacent to the Western Australian border, and if the direction is for the purpose of emergency management during a state of emergency, s 67(a) could support a direction prohibiting movement across the Western Australian border which differentiates between trade, commerce or intercourse across the Western Australian border as compared with intrastate trade, commerce or intercourse, in its legal and practical operation. It is then necessary to identify the object of the impugned provisions. Sections 56 and 67 are evidently concerned with managing a state of emergency321. That object is one other than erecting State borders as barriers against freedom of trade, commerce or intercourse and it is a legitimate object322. 319 Wotton (2012) 246 CLR 1 at 9-10 [10], 13-14 [21]-[22], 16 [31]; Brown (2017) 261 CLR 328 at 442-443 [356]; Banerji (2019) 93 ALJR 900 at 916 [44], 924-925 [96], 945-946 [209]-[210]; 372 ALR 42 at 59, 72, 100. See also Miller (1986) 161 CLR 556 at 607, 611, 614; AMS (1999) 199 CLR 160 at 176 [37], 179 [45], 179-180 [48], 232-233 [221]. cf Sportsbet Pty Ltd v New South Wales (2012) 249 CLR 298 at 317 [14]. 320 Miller (1986) 161 CLR 556 at 607. 321 See [174] above. 322 See [191] above. The final question is whether the differential burden is reasonably necessary for that legitimate object323. Although no separate question of differential burden arises under s 56, the conditions to the Minister's power to make a state of emergency declaration in s 56 and the limited duration of that declaration324 are relevant to whether the differential burden under s 67 is reasonably necessary for a legitimate object of the impugned provisions. The power in s 67(a) may only be exercised when a state of emergency has been declared under s 56. In addition, the statutory conditions in s 67(a) to the power of an authorised officer to prohibit movement, by direction, are so confined that any exercise of the power is reasonably necessary for the object of managing a state of emergency325. Each discretion is "effectively confined so that an attempt to exercise the discretion inconsistently with s 92 is not only outside the constitutional power – it is equally outside statutory power and judicial review is available to restrain any attempt to exercise the discretion in a manner obnoxious to the freedom guaranteed by s 92"326. Sections 56 and 67 are not provisions where the discretion is insufficiently controlled or is so wide as to be susceptible of being exercised inconsistently with s 92. Put in different terms, the discretion granted by these provisions is not wider than the Constitution can support327; it cannot be exercised in a manner obnoxious to the freedom guaranteed by s 92328. The statutory indicia are so tightly constrained that a differential burden can be placed on interstate trade, commerce and intercourse only in extraordinary and highly particular circumstances, namely to meet an emergency constituted by, in this case, an epidemic, the management of the adverse effects of which required a significant and coordinated response. That differential burden is not discriminatory. Here, the search for some alternative legislative means for dealing with the epidemic is futile, given the tightly constrained statutory indicia, and in circumstances where the disease was highly contagious and potentially deadly, 323 See fn 246 above. 324 See [174]-[175] above. 325 See [176] above. 326 Miller (1986) 161 CLR 556 at 614. 327 Miller (1986) 161 CLR 556 at 611. 328 Miller (1986) 161 CLR 556 at 607, 611, 612, 614. the vector was human and the disease could be transmitted to others, sometimes many others, by a person who was asymptomatic329. The conclusion that the differential burden capable of being imposed by ss 56 and 67 of the Act is reasonably necessary where an emergency is constituted by a hazard in the nature of an epidemic – and is not discriminatory and does not infringe s 92 – is supported by both history and authority. During the Convention Debates, Mr O'Connor, in addressing s 92, considered that States may330: "prohibit[] both persons and animals, when labouring under contagious diseases, from entering their territory. They may pass any sanitary laws deemed necessary for this purpose, and enforce them by appropriate regulations. It is upon this reserved right of self-protection that quarantines are permitted to interfere with the freedom of commerce and of human intercourse." That view has been reflected in decisions of this Court, as well as the Privy Council, holding that s 92 will likely not be infringed by a law which has the object of protecting the citizens of a State from disease or some other threat to health. For example, as Brennan J observed in Nationwide News, "permissible regulation ... might take the form 'of excluding from passage across the frontier of a State creatures or things calculated to injure its citizens'"331. On their proper construction, ss 56 and 67 of the Act, in their application to an emergency constituted by the occurrence of a hazard in the nature of an epidemic, comply with the constitutional limitation of s 92 of the Constitution in each of its limbs. They do not impose an unjustified differential burden on interstate trade, commerce or intercourse in favour of intrastate trade, commerce or intercourse. They are not discriminatory. 329 Palmer [2020] FCA 1221 at [84], [88]-[89]. cf Betfair No 1 (2008) 234 CLR 418 at 330 Official Record of the Debates of the Australasian Federal Convention (Sydney), 22 September 1897 at 1062. 331 (1992) 177 CLR 1 at 58, quoting Bank Nationalization Case (1949) 79 CLR 497 at 641; [1950] AC 235 at 312. See also Ex parte Nelson [No 1] (1928) 42 CLR 209 at 218-219; James v Cowan (1932) 47 CLR 386 at 396; [1932] AC 542 at 558; Tasmania v Victoria (1935) 52 CLR 157 at 168-169, 175-176; Fergusson v Stevenson (1951) 84 CLR 421 at 434-435; North Eastern Dairy (1975) 134 CLR 559 at 607-608; Permewan Wright Consolidated Pty Ltd v Trewhitt (1979) 145 CLR 1 at 25; Castlemaine Tooheys (1990) 169 CLR 436 at 472. It was open for the plaintiffs, when the Minister issued the state of emergency declaration and every 14 days when it was renewed, and when the State Emergency Coordinator issued the Directions and each time the Directions were amended, to challenge one or more of the exercises of those statutory powers on the grounds that the relevant actions were beyond power. No such challenge was ever made. For these reasons I agreed with the orders that were made on 6 November Edelman Introduction The central question in the special case in the original jurisdiction of this Court concerns the challenge by the plaintiffs, Mr Palmer and a privately held company under his direct and personal executive management, to the validity of the Quarantine (Closing the Border) Directions (WA). Those directions were made under the Emergency Management Act 2005 (WA) for the purpose of responding to the COVID-19 pandemic. The essence of the plaintiffs' case is that the Quarantine (Closing the Border) Directions are invalid by operation of s 92 of the Constitution because they involve an impermissible derogation from one or both aspects of the guarantee in that provision, those aspects being freedom of trade and commerce and freedom of intercourse. The relevant and operative part of s 92 of the Constitution provides that "[o]n the imposition of uniform duties of customs, trade, commerce, and intercourse among the States, whether by means of internal carriage or ocean navigation, shall be absolutely free". For more than a century, the meaning and effect of this provision has been disputed. Much of this dispute was resolved in Cole v Whitfield332, where this Court held that the "trade [and] commerce ... among the States" aspect of s 92 was to be absolutely free from unjustified discrimination of a protectionist nature by Commonwealth or State legislation. There were three strands to the reasoning in Cole v Whitfield which were not the subject of submissions in that case, which were not necessary for the decision, and which are not yet fully resolved. The first strand is the reasoning of the Court which treated the intercourse aspect of s 92, the movement across State borders generally by dealings or communications between people, as extending beyond freedom from laws that discriminate between the States in their treatment of that intercourse. It should not have been so extended. The second strand is the assumption of the Court that the discrimination with which the trade and commerce aspect is concerned is limited to protectionism, the most prolific form of discrimination among States in trade and commerce. Although it is not necessary to decide this point finally in this case, the proscribed discrimination should not have been so limited. The third strand, which was developed in Betfair Pty Ltd v Western Australia333, is how discrimination among the States can be justified. Legislation will discriminate when its purpose or effect is to burden trade, commerce, or 332 (1988) 165 CLR 360. 333 (2008) 234 CLR 418. Edelman intercourse in one State more than another. To avoid offending the guarantee in s 92, that burden must be justified by a transparent analysis of structured proportionality. Bringing these strands together, each aspect of s 92 should be aligned so that the provision is understood as a single freedom from unjustified discrimination concerning trade, commerce, or intercourse in Commonwealth or State legislation, with justification to be assessed in a transparent way. A preliminary question arises in this case. That question concerns the subject of the challenge to validity. As in many constitutional cases in the past, the central focus of the plaintiffs' challenge to validity was an instrument, which is a particular application of primary legislation, rather than the primary legislation itself. The instrument is the Quarantine (Closing the Border) Directions made under the Emergency Management Act. The validity of that primary legislation, as the source of authority for the Quarantine (Closing the Border) Directions, must be the starting point for the assessment of the validity of the directions as an exercise or application of that authority. Where the relevant provisions of the primary legislation are open-textured and can be disapplied from any invalid application then it will rarely be appropriate for a court to speculate upon whether the provisions are valid in all their applications, including hypothetical circumstances that are not before the court. It will usually be necessary to consider the validity of the provisions in relation to particular applications before the court or, slightly more generally, to applications of the general kind of those before the court. Sections 56 and 67 of the Emergency Management Act, in combination, are the sources of authority for the Quarantine (Closing the Border) Directions. Sections 56 and 67 are open-textured provisions which can be disapplied from any application which would be invalid334. The answer given by this Court on 6 November 2020 to the central question in the special case was that ss 56 and 67 are valid in their application to circumstances that encompass a general type of direction which includes the Quarantine (Closing the Border) Directions. For the reasons below, I join in the orders made by the Court. Sections 56 and 67 of the Emergency Management Act Section 56 empowers the Minister for Emergency Services, as the responsible Minister335, to declare that a state of emergency exists over the whole or any part of the area of Western Australia. One condition for the making of that 334 Interpretation Act 1984 (WA), s 7. 335 See Interpretation Act, s 12. Edelman declaration is that the Minister is satisfied that extraordinary measures are required to prevent or minimise, among other things, loss of people's lives or harm to their health. A state of emergency declaration gives rise to powers under s 67 which can be exercised during the period the declaration remains in force. A state of emergency declaration remains in force initially for three days336, but can be extended, or further extended, by periods that do not exceed 14 days337. By itself, s 56 has no effect, and imposes no burden, upon freedom of interstate trade, commerce, and intercourse. Section 67, which depends for its operation on s 56, has the potential to impose a burden upon freedom of interstate trade, commerce, and intercourse. It provides, among other things, that for the purposes of emergency management, during a state of emergency, an authorised officer may prohibit the movement of persons into or out of the "emergency area"338. In that sphere of its application it allows for possible restrictions on entry to the State of Western Australia, such as those contained in the Quarantine (Closing the Border) Directions. Restrictions on entry of this nature have the effect of burdening the freedom of interstate trade, commerce, and intercourse by discrimination. A person resident outside Western Australia, unlike a person resident within Western Australia, could be subject to restrictions or exclusions on conducting in-person trade and commerce in Western Australia, or on engaging in in-person dealings or communications generally in Western Australia. The level of application at which to assess validity of the Emergency Management Act The premises of the answer given by this Court Two days after the conclusion of the hearing of this special case, this Court answered the first question concerning the alleged invalidity of the Quarantine (Closing the Border) Directions and the authorising Emergency Management Act, at least by majority, as follows: "On their proper construction, ss 56 and 67 of the Emergency Management Act 2005 (WA) in their application to an emergency constituted by the occurrence of a hazard in the nature of a plague or epidemic comply with the constitutional limitation of s 92 of the Constitution in each of its limbs. 336 Emergency Management Act 2005 (WA), s 57. 337 Emergency Management Act, s 58. 338 Emergency Management Act, s 3 (definition of "emergency area"). Edelman The exercise of the power given by those provisions to make paras 4 and 5 of the Quarantine (Closing the Border) Directions (WA) does not raise a constitutional question. No issue is taken as to whether the Quarantine (Closing the Border) Directions (WA) were validly authorised by the statutory provisions so that no other question remains for determination by a court." There are two premises underlying the answer given by this Court. The first, as the State of Victoria correctly submitted, is that questions of constitutional validity should be determined at the level of an empowering statute339, leaving questions concerning the validity of actions taken under the statute, including regulations, directions and administrative action, to be resolved by reference to whether the valid statute empowers that action. The need to adjudicate questions of validity at the level of an empowering statute arises irrespective of whether the action under the statute is administrative action or delegated legislation. Hence, contrary to the plaintiffs' submissions, an analysis of the validity of the action under the statute does not depend upon fine distinctions arising under s 41 of the Interpretation Act 1984 (WA) between "subsidiary legislation"340 and administrative action341. Just as the "first duty of any Court, in approaching a cause before it, is to consider its jurisdiction"342, the starting point in an assessment of the validity of any administrative action or delegated legislation is the source of authority for that administrative or legislative act. If the administrative or legislative act has a valid source of authority then the question is generally whether the act falls within that source or is ultra vires. The second premise to the answer given by this Court is that it is not appropriate in this case to affirm the validity of the relevant statutory provisions in the Emergency Management Act, such as ss 56 and 67, in all of their applications. 339 Wotton v Queensland (2012) 246 CLR 1 at 14 [22]. 340 Interpretation Act, s 5 (definition of "subsidiary legislation"). 341 See Sea Shepherd Australia Ltd v Western Australia (2014) 313 ALR 184. 342 Hazeldell Ltd v The Commonwealth (1924) 34 CLR 442 at 446. See also Federated Engine-Drivers and Firemen's Association of Australasia v Broken Hill Proprietary Co Ltd (1911) 12 CLR 398 at 415; Old UGC Inc v Industrial Relations Commission (NSW) (2006) 225 CLR 274 at 290 [51]; Federal Commissioner of Taxation v Tomaras (2018) 265 CLR 434 at 477 [132]; Leeming, Authority to Decide: The Law of Jurisdiction in Australia, 2nd ed (2020) at 37-38. cf Wilkie v The Commonwealth (2017) 263 CLR 487 at 521-522 [56]-[57]. Edelman That is not to deny that in some cases affirming the validity of the relevant statutory provisions in all their applications will be appropriate. For instance, in Wotton v Queensland343, the State of Queensland successfully defended the validity of s 200(2) of the Corrective Services Act 2006 (Qld), which permitted the imposition of conditions upon parole that the parole board reasonably considered to be necessary, on the basis that the provision effectively incorporated the requirement for constitutional justification and was therefore valid in its entirety. There was no need, in answering the constitutional question, to descend to the level of a particular application of the statute, namely the particular conditions imposed by the parole board. On the other hand, there are other circumstances, including those in this case, where it is not appropriate for the Court to assess the validity of statutory provisions in relation to all of their applications. In cases where statutory provisions are open-textured – where their interpretation requires them to be "applied distributively"344 to numerous different circumstances – and do not expressly incorporate sufficient limitations as to be facially compliant with the Constitution345 then the Court should rarely adjudicate upon the validity of all applications of the relevant statutory provision. It is enough to conclude that the provisions can be "disapplied"346 or, in unfortunate terminology better used in the 343 (2012) 246 CLR 1. See also Comcare v Banerji (2019) 93 ALJR 900 at 945-946 [207]-[211]; 372 ALR 42 at 99-101. 344 Bank of New South Wales v The Commonwealth (1948) 76 CLR 1 at 369. 345 See, eg, Miller v TCN Channel Nine Pty Ltd (1986) 161 CLR 556 at 613-614, quoting Inglis v Moore [No 2] (1979) 25 ALR 453 at 459; Cunliffe v The Commonwealth (1994) 182 CLR 272 at 331; Attorney-General (SA) v Adelaide City Corporation (2013) 249 CLR 1 at 88 [216]. 346 Clubb v Edwards (2019) 267 CLR 171 at 316-322 [421]-[433]; Comcare v Banerji (2019) 93 ALJR 900 at 945-946 [210]-[211]; 372 ALR 42 at 100-101. See also Australian Railways Union v Victorian Railways Commissioners (1930) 44 CLR 319 at 377, quoting Newcastle and Hunter River Steamship Co Ltd v Attorney-General for the Commonwealth (1921) 29 CLR 357 at 369, "operate on so much of its subject matter as Parliament might lawfully have dealt with"; Bank of New South Wales v The Commonwealth (1948) 76 CLR 1 at 369, "confined in its operation"; Vella v Commissioner of Police (NSW) (2019) 93 ALJR 1236 at 1250 [53]; 374 ALR 1 at 16, "extended only to those orders for which the section might 'lawfully be applied'". Edelman interpretation of the meaning of words rather than in their application347, "read down" to exclude any hypothetical applications that might be constitutionally invalid. The Court can focus upon the application of the provision to the relevant facts before the Court or facts of that general kind. Sections 56 and 67 of the Emergency Management Act are open-textured provisions which do not expressly ensure freedom from discrimination in trade, commerce, and intercourse. They are capable of being disapplied to the extent that any hypothetical application would lead to invalidity348. Contrary to the oral submissions of the State of Victoria, it is neither necessary nor appropriate for the Court to adjudicate upon the validity of every application of those provisions. The answer given by this Court does not do so. The appropriate level of generality at which to assess validity The answer given by this Court to the first question in this special case concerned the validity of ss 56 and 67 of the Emergency Management Act in their applications of a particular kind. The provisions were not divided into severable parts349. Instead the answer focused upon the provisions "in their application" as follows: although not overtly expressed, the application was limited in the answer to the limb of s 67 concerned with a "state of emergency" as declared under s 56, rather than the limb concerned with an "emergency situation" as declared under s 50; the application was limited in the answer to the purpose of emergency management of a declared state of emergency under s 56 where the "emergency" – defined in s 3 to mean the occurrence or imminent occurrence of a hazard in certain circumstances – involves "a plague or an epidemic" rather than other limbs of the definition of "hazard" in s 3. Those other limbs include: cyclones, earthquakes or other natural events; fires; road, rail or air crashes; terrorist acts; or events prescribed by regulations that are capable of causing harm to the health of persons or animals, or damage to property or the environment. The focus of the answer 347 But, in that context, see Hume, "The Rule of Law in Reading Down: Good Law for the 'Bad Man'" (2014) 37 Melbourne University Law Review 620 at 623-624. See also Dawson v The Commonwealth (1946) 73 CLR 157 at 178. 348 Interpretation Act, s 7. 349 Clubb v Edwards (2019) 267 CLR 171 at 314-316 [418]-[420]. Edelman in its reference to plague or "epidemic", from epi dēmos ("upon people"350), is limited to human disease; (iii) the application was limited in the answer to "the occurrence of a hazard", and did not extend to the "imminent occurrence of a hazard" within the definition of "emergency" in s 3, thus excluding from consideration applications based upon anticipated events that might not occur; and the application, by its confinement to a plague or an epidemic and its focus on human disease, was impliedly limited in the answer to a state of emergency where the Minister is satisfied that extraordinary measures are required to prevent or minimise "loss of life, prejudice to the safety, or harm to the health, of persons", rather than "loss of life, prejudice to the safety, or harm to the health, of ... animals" (s 56(2)(c)(i)), "destruction of, or damage to, property" (s 56(2)(c)(ii)), or "destruction of, or damage to, any part of the environment" (s 56(2)(c)(iii)). By focusing only upon particular textual aspects of ss 56 and 67, this Court's answer focused upon the application of the legislation to facts falling within a category based upon circumstances of the same general kind as those before it. There might, at first blush, be thought to be tension between, on the one hand, assessing validity, as the answer to the first question in this special case does, by focusing upon the application of legislation to circumstances of the same general kind as those before the Court and, on the other hand, remarks made in the joint judgment in Wotton v Queensland351 which accepted a submission that "whether a particular application of the statute, by the exercise or refusal to exercise a power or discretion conferred by the statute, is valid is not a question of constitutional law". This tension is one reason that Professor Stellios suggested that the decision of Crennan and Kiefel JJ in Attorney-General (SA) v Adelaide City Corporation352, which assessed the compatibility of a by-law with the constitutional implied freedom of political communication, might be "at odds with the approach accepted in Wotton"353. But there is a difference between (i) assessing the validity of an open-textured legislative provision, such as a general by-law making power, by 350 Porta, A Dictionary of Epidemiology, 6th ed (2016). 351 (2012) 246 CLR 1 at 14 [22]. 352 (2013) 249 CLR 1 at 88-90 [217]-[222]. 353 Stellios, "Marbury v Madison: Constitutional limitations and statutory discretions" (2016) 42 Australian Bar Review 324 at 341. Edelman reference to limited applications of that legislative provision, and (ii) assessing the validity of the by-law ("the particular application") itself. The former engages questions of constitutional power: "[i]f Parliament had enacted [the by-laws] directly, would they be valid?"354. The latter should only be a question of whether the by-law falls within the valid legislative power. It is arguable that the answer given to the first question in this special case should have been framed with greater focus upon the validity of the Emergency Management Act in its application to the particular facts of this case, including the terms of the Quarantine (Closing the Border) Directions, which were the basis for the finding of facts by Rangiah J. That focus was present in the careful submissions made by the State of Western Australia, which, as I note below, had the onus of justifying any discrimination between States in relation to trade, commerce, or intercourse in the Emergency Management Act355. Courts will not usually need to uphold the validity of open-textured legislation in its application to circumstances that are not before the court and not sought to be validated by the parties. There would have been no difficulty in further confining the answer to the first question in this special case to the validity of the Emergency Management Act in its application to circumstances in the nature of those contained in the Quarantine (Closing the Border) Directions. Such a more refined answer would exclude further applications that are irrelevant to the facts before this Court such as whether directions could be made in any epidemic under s 67(c) to close all roads and access routes into Western Australia, without any exceptions, or, under s 67(b), to direct the removal of persons infected with any plague or disease from Western Australia. A more confined answer that focuses closely upon the precise circumstances before the Court is also consistent with the approach taken by many decisions of this Court including those before and after Wotton v Queensland356, none of which has ever been suggested to be wrong for taking this approach. 354 APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 373 [104], quoting O'Sullivan v Noarlunga Meat Ltd (1954) 92 CLR 565 at 594. 355 See, and compare, Street v Queensland Bar Association (1989) 168 CLR 461 at 511-512; McCloy v New South Wales (2015) 257 CLR 178 at 201 [24]; Brown v Tasmania (2017) 261 CLR 328 at 370 [131]. 356 For example, Hartley v Walsh (1937) 57 CLR 372 (Dried Fruits Regulations (Vic), reg 22); R v University of Sydney; Ex parte Drummond (1943) 67 CLR 95 (National Security (Universities Commission) Regulations (Cth), reg 16); Adelaide Company of Jehovah's Witnesses Inc v The Commonwealth (1943) 67 CLR 116 (National Security (Subversive Associations) Regulations (Cth)); Gratwick v Johnson (1945) Edelman Although I initially doubted whether it was appropriate for this Court to express the level of application of the answer considerably higher than that to which most of the parties had made submissions, I am now satisfied that it is appropriate to assess the validity of ss 56 and 67 of the Emergency Management Act at a higher level of generality than the Quarantine (Closing the Border) Directions, although at a more particularised level of application than all applications of those provisions. I have formed that view for three reasons. First, although the State of Western Australia sought to justify ss 56 and 67 of the Emergency Management Act at the particular level of the Quarantine (Closing the Border) Directions, the State of Victoria sought to justify ss 56 and 67 in all their applications. Secondly, no submissions were made about how a choice of the appropriate level of generality should be made for the assessment of the application of ss 56 and 67. Thirdly, I am satisfied that ss 56 and 67, as confined in their application in the three textual ways that I have mentioned, are consistent with s 92 of the Constitution. I therefore join in the orders that were made. Aligning the two aspects of s 92 of the Constitution The two aspects of s 92 In Cole v Whitfield357, by focusing upon the particular application of the legislation to the regulations before the Court, this Court effectively upheld the validity of s 9 of the Fisheries Act 1959 (Tas) in its application to regs 31(1)(d)(ix) and 31(1)(d)(x) of the Sea Fisheries Regulations 1962 (Tas). Central to the Court's reasoning was that "the freedom guaranteed to interstate trade and commerce under s 92 is freedom from discriminatory burdens in the protectionist sense"358. 70 CLR 1 (Restriction of Interstate Passenger Transport Order made under the National Security (Land Transport) Regulations (Cth)); North Eastern Dairy Co Ltd v Dairy Industry Authority of NSW (1975) 134 CLR 559 (Pure Food Regulations (NSW), reg 79(10)(c)); Cole v Whitfield (1988) 165 CLR 360 (Sea Fisheries Regulations 1962 (Tas), reg 31(1)(d)); Levy v Victoria (1997) 189 CLR 579 (Wildlife (Game) (Hunting Season) Regulations 1994 (Vic), reg 5); APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 (Legal Profession Regulation 2002 (NSW), Pt 14); Attorney-General (SA) v Adelaide City Corporation (2013) 249 CLR 1 (By-law No 4 entitled "Roads" made by the Corporation of the City of Adelaide); Queensland Nickel Pty Ltd v The Commonwealth (2015) 255 CLR 252 (Clean Energy Regulations 2011 (Cth), Div 48 of Pt 3 of Sch 1). 357 (1988) 165 CLR 360. 358 Cole v Whitfield (1988) 165 CLR 360 at 395. Edelman Discrimination involves the "departure from equality of treatment"359. It occurs where there is the "unequal treatment of equals, and, conversely, [the] equal treatment of unequals"360. A law can have the purpose of discrimination or it can have the effect of discrimination. In either case, a conclusion of discriminatory treatment will be easiest to draw where the law, on its face, purports to treat States differently. Where the discrimination does not appear from the text of the law, it is necessary to show that the purpose or effect of the law is to discriminate based upon its expected practical operation. In the trade and commerce aspect of s 92, the relevant discrimination involves unequal treatment by a law that confers a trading or commercial advantage upon persons within one State compared with those in another. Conversely, the law imposes a trading or commercial burden upon those in the second State when compared with the first. But the advantage or burden must concern trade or commerce. In Cole v Whitfield, for example, it was held that, although the law operated in a discriminatory way for the protection and conservation of "the stock of Tasmanian crayfish", the law was not relevantly discriminatory because the evidence did not establish that Tasmanian crayfish production gained any competitive advantage such as "by eliminating undersized imported crayfish from the local market"361. trade and commerce called protectionism. Protectionism The focus in Cole v Whitfield was upon the particular type of discrimination involves discrimination, in the form of either a protectionist purpose or a protectionist effect362, in favour of the local State by conferring a competitive or market advantage over one or more other States. The assessment of a local competitive advantage requires consideration of economic concepts of cross-elasticity of supply and demand to identify competition between goods or services in the local State and other States. This is the economist's approach to determining, for example, whether "breakfast cereals compete with bacon and eggs"363. It is difficult to avoid these economic concepts in the assessment of protectionism, although some cases after Cole v Whitfield have applied the requirement for protectionist discrimination in a loose manner, without precision in assessing the protectionist 359 Cole v Whitfield (1988) 165 CLR 360 at 399. 360 Castlemaine Tooheys Ltd v South Australia (1990) 169 CLR 436 at 480. 361 (1988) 165 CLR 360 at 409. 362 Cole v Whitfield (1988) 165 CLR 360 at 407-408. 363 Staker, "Section 92 of the Constitution and the European Court of Justice" (1990) 19 Federal Law Review 322 at 344-345. Edelman nature of the impugned laws364, and it has been observed that "protectionism may be considered to be unnecessary to the economic theory of competition"365. More will be said of protectionism later in these reasons but at this point it suffices to say that protectionism is only one form of discrimination in trade and commerce that imposes burdens on persons in one State compared with another. Although protectionism is by far the most common form of discrimination relevant to the trade and commerce aspect of s 92, and the form with which the Court was concerned in Cole v Whitfield, there are other forms of discrimination that could be just as damaging to the purpose of s 92. For instance, State legislation might have the unintended effect of conferring a competitive disadvantage upon local trade and commerce when compared with another State. Or the Commonwealth might confer a competitive advantage on one State to the disadvantage of another. Or a State might confer a competitive advantage on one foreign State over another in an industry in which there is no competition in the local State. For instance, suppose that Western Australian legislation imposed an unjustified prohibition upon the sale in Western Australia of a type of good insofar as it was manufactured in New South Wales but not insofar as that type of good was manufactured in Queensland. Even if no manufacturer in Western Australia competed in the market for that type of good, so that the discrimination was only between products from New South Wales and Queensland, it is difficult to see why that discrimination, if unjustified, would be consistent with the freedom of trade rationale underlying In Cole v Whitfield it was accepted that the constitutional protection of free intercourse among the States – free "movement ... across State borders"366 generally involving interstate "dealings or communication between individuals"367 with "a corresponding increase in their acquaintance with one another and with the 364 Bath v Alston Holdings Pty Ltd (1988) 165 CLR 411 at 426; Castlemaine Tooheys Ltd v South Australia (1990) 169 CLR 436 at 476; Staker, "Section 92 of the Constitution and the European Court of Justice" (1990) 19 Federal Law Review 322 365 Kiefel and Puig, "The Constitutionalisation of Free Trade by the High Court of Australia and the Court of Justice of the European Union" (2014) 3 Global Journal of Comparative Law 34 at 41. 366 Gerner v Victoria (2020) 95 ALJR 107 at 115 [28], quoting Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 192. 367 Macquarie Dictionary, 7th ed (2017), vol 1 at 789, "intercourse", sense 1. Edelman different parts of the Continent"368 – was not confined to guarding against protectionist discrimination, or even discrimination at all. The Court asserted that there was no correspondence "between the freedom guaranteed to interstate trade and commerce and that guaranteed to interstate intercourse"369. The Court said that the freedom of interstate intercourse extended to "a guarantee of personal freedom 'to pass to and fro among the States without burden, hindrance or restriction'"370. The treatment in Cole v Whitfield of interstate intercourse as a "personal freedom" was not a suggestion that s 92 operated as a guarantee of a personal right rather than as a restriction upon legislative power. It was to emphasise the height of the barriers to the imposition of any burden upon interstate intercourse. That approach, by which s 92 was seen to guarantee more than merely freedom from discriminatory burdens, was not necessary for the decision in Cole v Whitfield and should not be followed. Instead, for the reasons below, the test for contravention of the intercourse aspect of s 92 should be aligned with that applicable to the trade and commerce aspect. The test should involve an enquiry into whether the impugned law, without justification, discriminates between States by burdening one State more than another. The most common instance of such discrimination, and the intercourse with which this case was concerned and to which the State of Queensland pointed, is discrimination between intrastate and interstate intercourse. Extending the discrimination test to the intercourse aspect of s 92 Interstate commerce is very often associated with, and inextricable from, interstate intercourse, as can be seen in the expression used before federation of "commercial intercourse"371. The association of the two is usually so close that Sir Robert Garran had thought that it might be better to leave out the words "and intercourse" because "[t]rade and commerce have always been held to include intercourse, and the insertion of 'intercourse' [in s 92] may limit the meaning of 368 Griffith, Notes on Australian Federation: Its Nature and Probable Effects (1896) at 369 Cole v Whitfield (1988) 165 CLR 360 at 394. 370 Cole v Whitfield (1988) 165 CLR 360 at 393, quoting Gratwick v Johnson (1945) 70 CLR 1 at 17. 371 See, for instance, references to "commercial intercourse" in Official Record of the Debates of the Australasian Federal Convention (Melbourne), 18 February 1898 at 1155 (Mr Solomon) and Report from the Committee on Provisions Relating to Finance, Taxation, and Trade Regulation, to the Committee on Constitutional Machinery, Functions, and Powers (23 March 1891). Edelman 'trade and commerce' elsewhere"372. But the conclusion that "intercourse" is limited by a requirement that its purpose be trade and commerce is a formal fallacy, inferring inevitability from usual association. That conclusion has never been accepted. It was expressly rejected in Nationwide News Pty Ltd v Wills373 by Deane and Toohey JJ. In Cole v Whitfield374 this Court had proceeded on the assumption that the freedom of intercourse was not limited to intercourse in trade and commerce. It is one thing to conclude, correctly, that the expression "trade, commerce, and intercourse among the States ... shall be absolutely free" does not require that intercourse be for the purpose of trade and commerce. But it is quite another to conclude that fundamentally different tests should be applied to the freedom of trade and commerce on the one hand, and the freedom of intercourse on the other. Nevertheless, the reasoning in Cole v Whitfield375 to the effect that these two aspects of the constitutional freedom in s 92 should be treated differently has largely been unquestioned in later cases. But not always. The clearest example of an approach which substantially assimilates the two aspects of s 92 was that taken by Toohey J in Cunliffe v The Commonwealth376. In that case, the provisions of Pt 2A of the Migration Act 1958 (Cth), which regulated the operation of migration agents, were said to contravene the freedom of interstate intercourse. The provisions were said to burden interstate communications immigration representations. In the majority for holding the provisions entirely valid, Toohey J dismissed the submission that the provisions were contrary to s 92, saying377: immigration assistance and involved 372 Draft Commonwealth Bill: Amendments suggested by R R Garran, Garran Papers, MS 2001, Box 10, ANL. 373 (1992) 177 CLR 1 at 82-83. See also Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 192. 374 (1988) 165 CLR 360 at 388. 375 (1988) 165 CLR 360 at 394. 376 (1994) 182 CLR 272 at 384. See also at 333, Brennan J reiterating his views from Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 53-61 but cf at 57 "discrimination is not an essential feature of an impermissible burden imposed on interstate intercourse". 377 Cunliffe v The Commonwealth (1994) 182 CLR 272 at 384. Edelman "Pt 2A is a law of general application. Neither in its terms nor in its operation does it impose any burden on interstate intercourse which it would not impose, absent State borders." The approach of Toohey J requires consideration of whether the impugned law discriminates between dealings or communications between persons based upon State boundaries. To burden intercourse in any State by reference to State borders is to discriminate against interstate intercourse. This reasoning applies the discrimination focus from the trade and commerce aspect to the intercourse aspect. The reasoning of Toohey J has powerful support in the text, the context, and the purpose of s 92. As to the text, "intercourse" appeared from the first draft of the clause which became s 92 in the expression "trade or intercourse"378. The composite nature of the expression "trade, commerce, and intercourse" militates against different tests for the trade and commerce aspect on the one hand and the intercourse aspect on the other. Each of the components of that expression is governed by the same qualifiers, from which the test derives, "absolutely free"379 and "among the States". As Hayne J observed in APLA Ltd v Legal Services Commissioner (NSW)380, the text of s 92 involves "three elements of a composite expression (trade, commerce, and intercourse among the States)" and "does not readily yield a distinction" between those elements. As to context, many transactions which constitute trade and commerce among the States will also constitute intercourse among the States381. Goods that are provided in commerce across State boundaries are usually transported by people. Services that are provided in commerce across State boundaries are usually provided by people. Hence, many laws that concern commerce across State boundaries will often concern the movement of people across the same boundaries. If the two aspects of s 92 have different tests there will be an inevitable "tension"382 between them. Should a law concerning commercial intercourse always be required to satisfy both tests, with the practical effect that the more stringent test 378 Cole v Whitfield (1988) 165 CLR 360 at 387. 379 Rose, "Cole v Whitfield: 'Absolutely Free' Trade?", in Lee and Winterton (eds), Australian Constitutional Landmarks (2003) 335 at 350. 380 (2005) 224 CLR 322 at 456-457 [401]-[402]. 381 APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 456 [400], quoting Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 59. 382 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 83. Edelman for intercourse would be applied to commercial intercourse rather than the less stringent test for trade and commerce? Or should a law concerning commercial intercourse only be required to satisfy the test for trade and commerce, in effect subjecting a law that burdens intercourse to a less stringent test where that intercourse is in trade and commerce383? Another approach, described by one commentator as "very unsatisfactory"384, is for the test to be applied to depend upon whether the law is characterised as one concerning trade and commerce or one concerning intercourse385. None of these approaches is without difficulty. As to purpose, each aspect of s 92 shares a common purpose of ensuring free movement across borders of goods, services, dealings, and communications. When Sir Henry Parkes proposed the motion in 1891 that "trade and intercourse between the federated colonies ... shall be absolutely free" he saw trade and intercourse as part of a composite expression, with the common goal of removing barriers "of any kind between one section of the Australian people and another"386. Hence, if the intercourse aspect of s 92 shares a focus upon discrimination between the States then it can readily be seen to align with the single purpose of s 92 "to create a free trade area throughout the Commonwealth and to deny to Commonwealth and States alike a power to prevent or obstruct the free movement of people, goods and communications across State boundaries"387. Without a requirement for discrimination, a near-absolute freedom of intercourse would put interstate intercourse "on a privileged or preferred footing, immune from burdens" to which other intercourse is subject388. The effect of this conclusion is that s 92 prohibits any form of unjustified discrimination between States in relation to intercourse among the States. No person should be subject to unjustified restrictions by reference to State borders on dealings or communication, whether constituting commercial or non-commercial intercourse. The intercourse aspect of s 92 is concerned with 383 APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 390-391 384 Rose, "Cole v Whitfield: 'Absolutely Free' Trade?", in Lee and Winterton (eds), Australian Constitutional Landmarks (2003) 335 at 351. 385 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 83-84. 386 Official Report of the National Australasian Convention Debates (Sydney), 4 March 387 Cole v Whitfield (1988) 165 CLR 360 at 391. 388 See Cole v Whitfield (1988) 165 CLR 360 at 402. See also Kirk, "Section 92 in its Second Century", in Griffiths and Stellios (eds), Current Issues in Australian Constitutional Law: Tributes to Professor Leslie Zines (2020) 253 at 279. Edelman discrimination in relation to intercourse between any States, not merely intercourse between a foreign State and the local State. Hence, a law enacted in Western Australia that imposes restrictions on entry into Western Australia upon residents of New South Wales but no such restrictions upon residents of Queensland involves a burden upon intercourse among the States by two types of discrimination. The law must be justified not merely by reference to the restriction upon New South Wales residents vis-à-vis Western Australian residents but also by reference to the restriction upon New South Wales residents vis-à-vis Queensland residents. Protectionism in the trade and commerce aspect of s 92 Despite the force of Queensland's submission that the test for the intercourse aspect should align with that for the trade and commerce aspect, and despite the obvious need for freedom of intercourse, which need not be commercial, not to be confined to freedom from protectionist discrimination, no party challenged the assumption in Cole v Whitfield that the discrimination between the States in the trade and commerce aspect of s 92 is limited to protectionist discrimination. As explained above, protectionism is the "protection of domestic [intrastate] industries against foreign [interstate] competition"389. It gives "the domestic product or the intrastate trade in that product a competitive or market advantage over the imported product or the interstate trade in that product"390. Of all the concepts invoked in the explication of s 92 in Cole v Whitfield, the concept of protectionism has been described as "the one least known to constitutional law in Australia"391. It is, by far, the most common manner by which State laws might discriminate between States in trade and commerce. But it is not the only manner. The assumption in this case, based solidly in long-standing392, accepted393 precedent, that any requirement for discrimination in a test for freedom of interstate 389 Cole v Whitfield (1988) 165 CLR 360 at 393, quoted in Betfair Pty Ltd v Western Australia (2008) 234 CLR 418 at 455-456 [24]. 390 Castlemaine Tooheys Ltd v South Australia (1990) 169 CLR 436 at 467. 391 Carney, "The Re-Interpretation of Section 92: The Decline of Free Enterprise and the Rise of Free Trade" (1991) 3 Bond Law Review 149 at 155. 392 Gratwick v Johnson (1945) 70 CLR 1. 393 Cole v Whitfield (1988) 165 CLR 360 at 393, 406. Edelman the States" intercourse would not be limited to protectionist discrimination was correctly made. There is no basis in the text, context, or purpose of s 92 to limit the concept laws concerning dealings or of discrimination "among communications between people which are protectionist. Such an unduly limited approach: (i) would not prohibit a Commonwealth law from discriminating between two States or a State law from discriminating between other States; (ii) would not prohibit a State law from discriminating against the interests of the local State in favour of another State; and (iii) would not prohibit a Commonwealth or State law from discriminating in favour of one State by conferring advantages upon that State other than competitive or market advantages. Indeed, the leading decision concerning the intercourse aspect of s 92 involved a Commonwealth law that impermissibly discriminated between intrastate and interstate intercourse, without any suggestion that this discrimination was protectionist394. The assumption, whilst correct, highlights the incongruity in prohibiting all forms of discrimination among the States under the intercourse aspect but prohibiting only protectionist discrimination under the trade and commerce aspect of s 92. Indeed, one mark of various early versions of the free trade theory adopted by this Court was the focus upon discrimination generally rather than protectionist discrimination. As this Court observed in Cole v Whitfield395, the decision in Fox v Robbins396 was "a classic instance of discrimination". Although, as Barton J observed, the higher licence fee for sale of interstate wine involved "inter-state protection"397, the approach in that case, like others398, did not confine discrimination between any States to protectionism399. A broader conceptualisation of discrimination – that is, beyond protectionist discrimination – also accords closely with many statements during the Convention Debates. Those statements emphasised the importance of interstate free trade 394 Gratwick v Johnson (1945) 70 CLR 1. 395 (1988) 165 CLR 360 at 406. 396 (1909) 8 CLR 115. 397 Fox v Robbins (1909) 8 CLR 115 at 123. 398 See New South Wales v The Commonwealth (1915) 20 CLR 54 at 79; Duncan v Queensland (1916) 22 CLR 556 at 574; The Commonwealth and Commonwealth Oil Refineries Ltd v South Australia (1926) 38 CLR 408 at 439-440. 399 Fox v Robbins (1909) 8 CLR 115 at 120, quoting Welton v State of Missouri (1875) 91 US 275 at 281. See also at 124 ("whether their State of origin be the taxing State or another"), 127 ("the discriminating charge"). Edelman generally, freedom from "everything in the nature of an obstruction placed in the way of intercolonial trade"400, rather than a concern which was confined to the most common circumstance of discrimination in trade and commerce, namely protectionism. Accordingly, the constraint imposed in Cole v Whitfield which limited discrimination in trade and commerce among the States only to protectionist discrimination has been powerfully criticised as contrary to the underlying purpose of s 92 to ensure a unitary free trade area401. In the absence of any challenge to the protectionist element in the test for the trade and commerce aspect, this issue need not be finally resolved. Nevertheless, given (i) the need to explain and consider the discrimination test in the intercourse aspect of s 92 in this case, (ii) the nature of the composite expression "trade, commerce, and intercourse among the States" and (iii) the obvious incongruity arising from the adoption of a test based on a narrower type of discrimination for the trade and commerce aspect and the need for resolution of the tension between the two aspects of s 92, it is necessary to make four further observations about an assumption which treats the trade and commerce aspect, unlike the intercourse aspect, as concerned only with discrimination in a "protectionist sense"402. free First, whilst trade "commonly signified"403 an absence of protectionism, that was not, and is not, its only signification. Free trade also signifies freedom from any kind of discrimination in trade and commerce. As is recognised also by the complementary provisions of ss 99 and 102 of the Constitution (which enshrined the same anti-discrimination goal404), protectionism is not the only manner in which discrimination can impair trading and commercial 400 Official Record of the Debates of the Australasian Federal Convention (Melbourne), 11 March 1898 at 2373 (Mr Deakin). See also Quick and Garran, The Annotated Constitution of the Australian Commonwealth (1901) at 845 "unburdened by State restrictions, regulations, or obstructions". 401 Staker, "Section 92 of the Constitution and the European Court of Justice" (1990) 19 Federal Law Review 322; Puig, The High Court of Australia and Section 92 of the Australian Constitution (2008). 402 Cole v Whitfield (1988) 165 CLR 360 at 394. 403 Cole v Whitfield (1988) 165 CLR 360 at 392-393. 404 Cole v Whitfield (1988) 165 CLR 360 at 392. Edelman and freedom within a "national economic unit"405. Other examples might be a Commonwealth law that discriminates in trade and commerce between two States by imposing a competitive disadvantage on one, or a State law in trade and commerce which discriminates only between other States or discriminates against the interests of the local State in favour of another State. As Professor Zines has said406, the "anti-protectionist" version of free trade is narrower than "a broader 'common market' approach". There is no apparent reason why the trade and commerce aspect of s 92 should be confined to the narrow approach. A test which focuses upon discrimination in trade and commerce generally, rather than merely upon protectionist discrimination, has thus been said to produce "results corresponding very closely with the picture [albeit vague] which seems to have been envisaged by the Convention"408. by Professor Stellios407, subsequently adopted Secondly, the only discrimination that was alleged in Cole v Whitfield was discrimination in a protectionist sense. Underlying the reasoning that the test for the trade and commerce aspect must be limited only to protectionist discrimination may have been a formal fallacy based on the fact that most observed instances of discrimination, and most of the discussion at the Convention Debates, involved protectionism. This formal fallacy may also have been the reason that this Court said in Cole v Whitfield that the pre-1900 United States cases on the negative commerce clause were not of "any assistance" in the interpretation of s 92409, a view that has since been quietly jettisoned410. As I have noted above, a similar formal fallacy based upon the usual association of interstate trade with interstate intercourse has not been committed; interstate intercourse has not been limited to commercial intercourse. 405 Betfair Pty Ltd v Western Australia (2008) 234 CLR 418 at 461 [39], quoting Castlemaine Tooheys Ltd v South Australia (1990) 169 CLR 436 at 470. 406 Zines, The High Court and the Constitution, 5th ed (2008) at 195. 407 Stellios, Zines's The High Court and the Constitution, 6th ed (2015) at 195. 408 Bailey, "Interstate Free Trade: The Meaning of 'Absolutely Free'" (1933) 7 Australian Law Journal 103 at 104. 409 (1988) 165 CLR 360 at 405. 410 Betfair Pty Ltd v Western Australia (2008) 234 CLR 418 at 459-464 [33]-[48]. See Gleeson, "What's left of Cole v Whitfield?" (2013) 24 Public Law Review 97 at 101. Edelman Thirdly, the Court in Cole v Whitfield acknowledged that the existence of the intercourse aspect suggested a "wider operation"411 of the trade and commerce aspect than merely guarding against discrimination in a protectionist sense. But the force of this point was thought to be diminished because the Court assumed that if the test treated the trade and commerce aspect and the intercourse aspect alike then "anarchy would result"412. This assumption would not have been made if the Court had accepted that freedom of intercourse was also concerned with guarding against discrimination generally between the States in relation to intercourse. Fourthly, although the removal of the protectionist element from discrimination in the trade and commerce aspect involves some adjustment to the understanding of the trade and commerce aspect outlined in Cole v Whitfield, in practical effect an almost identical adjustment is required by recognising a test for discrimination, without a requirement of protectionism, for the intercourse aspect of s 92. This is because interstate trade and commerce will almost always involve intercourse. An example of a case where the same adjustment would have to be made even without removing the protectionist element from discrimination in the trade and commerce aspect is Barley Marketing Board (NSW) v Norman413. In Barley Marketing Board, the defendants attempted to engage in interstate commercial intercourse by selling barley grown in New South Wales to a buyer in Victoria. New South Wales legislation prohibited the defendants from doing so by establishing a marketing board into which was vested title to all barley coming into existence in New South Wales. The Court observed that there was no evidence that the scheme restricted the supply of barley to other States414 and that there was no vesting of title to imported barley415. Further, it appears there was no evidence before the Court that the prices at which the board sold the barley interstate were higher than those prices which New South Wales producers would have charged in interstate sales416. The Court therefore held that the scheme was not 411 (1988) 165 CLR 360 at 393. 412 Cole v Whitfield (1988) 165 CLR 360 at 393. 413 (1990) 171 CLR 182. 414 Barley Marketing Board (NSW) v Norman (1990) 171 CLR 182 at 204. 415 Barley Marketing Board (NSW) v Norman (1990) 171 CLR 182 at 201-202, referring to North Eastern Dairy Co Ltd v Dairy Industry Authority of NSW (1975) 134 CLR 559. 416 Compare Gray, "Compulsory Marketing Schemes and Section 92 of the Australian Constitution" (2014) 33 University of Tasmania Law Review 317 at 331. Edelman protectionist417. If the requirement of protectionism were removed the case would have to be assessed against a broader criterion of discrimination. The defendants were subject to restrictions upon selling in Victoria that did not apply to producers in Victoria. The focus in the case upon protectionism meant that it was not necessary for the Court to explore whether this discrimination in the course of commercial intercourse conferred an advantage on Victorian producers which was unjustified. But since the defendants' conduct involved commercial intercourse between the States, and thus engaged the intercourse aspect of s 92, that broader assessment of discrimination would be required anyway by complete consideration of the unitary freedom of trade, commerce, and intercourse. Justifying discrimination by a structured proportionality analysis Putting to one side the difficulties involved in limiting discrimination in the trade and commerce aspect to protectionist discrimination, the test for compliance with s 92 can be simply expressed. The constitutional guarantee that "trade, commerce, and intercourse among the States ... shall be absolutely free" imposes a requirement that laws concerning movement across a border – whether it be goods, persons, or communications or other intangibles – cannot discriminate by imposing an unjustified burden on trade, commerce, or intercourse in one State compared with another. The development of a transparent and concise test of discrimination should not be undermined by a vague and opaque approach to justification. A significant step was taken in Castlemaine Tooheys Ltd v South Australia418 towards making transparent the approach to justification of a law that burdens trade, commerce, or intercourse in the proscribed way. In that case, five members of this Court said that a law that imposes a burden upon interstate trade and commerce would be "appropriate and adapted" if it imposed a burden that was incidental and was not disproportionate to the object to be achieved. themselves, words This step, while significant, did not complete the movement towards transparency. By like "appropriate and adapted" or "disproportionate" still conceal underlying reasoning and leave open a vast area for the exercise of discretion and subjective preference. More is also needed to provide clarity (i) for the State and Commonwealth Parliaments and (ii) for the States and the Commonwealth to attempt to discharge their onus of justifying relevantly discriminatory laws. Judicial reasoning concerning constitutional validity of legislation should not be a black box to be unlocked only when parties 417 Barley Marketing Board (NSW) v Norman (1990) 171 CLR 182 at 204. 418 (1990) 169 CLR 436 at 473. Edelman to a later case seek explanation for the earlier exercise of discretion. As Professor Birks observed when discussing unstructured discretion419: "The whole point of the rule of law is to ensure that power which cannot be put under the law should be accountable to the electorate and that, for the rest, we all live under the law, not under the wills and whims of a person or a group of people. The blessings of this commitment have been overlooked by the discretionary remedialists, who suddenly suppose that the judges should be the one group answerable only to God." It is no surprise that a form of structured proportionality analysis has been said to have been adopted by "virtually every effective system of constitutional justice in the world, with the partial exception of the United States"420, and even there the balancing approach may be best understood as a less structured form of proportionality421. In Australia, a structured proportionality analysis is now well established in the context of the implied freedom of political communication as a means to elucidate concepts such as "appropriateness". It was an analysis that was adopted by a majority of this Court in McCloy v New South Wales422, Brown v Tasmania423, Unions NSW v New South Wales424, and Clubb v Edwards425. The need for structure and transparency is no less for an analysis of the compatibility of laws with s 92. A similar analysis should be adopted, to make explicit that which would otherwise be implicit, when assessing whether a law which places a burden on the freedom guaranteed by s 92 is justified426. 419 Birks, "Three Kinds of Objection to Discretionary Remedialism" (2000) 29 University of Western Australia Law Review 1 at 15. 420 See Clubb v Edwards (2019) 267 CLR 171 at 332 [466], quoting Stone Sweet and Mathews, "Proportionality Balancing and Global Constitutionalism" (2008) 47 Columbia Journal of Transnational Law 72 at 74 and referring to Barak, Proportionality: Constitutional Rights and their Limitations (2012) at 181-210. 421 Clubb v Edwards (2019) 267 CLR 171 at 331 [465]. 422 (2015) 257 CLR 178 at 193-195 [2]-[3]. 423 (2017) 261 CLR 328 at 368-369 [123]-[127], 416-417 [278]. 424 (2019) 264 CLR 595 at 615 [42], 638 [110]. 425 (2019) 267 CLR 171 at 186 [5]-[6], 264-265 [266], 330-331 [462]-[463]. 426 See Kirk, "Constitutional Guarantees, Characterisation and the Concept of Proportionality" (1997) 21 Melbourne University Law Review 1 at 12-15; Kiefel, Edelman Structured proportionality makes explicit and transparent the only three independent grounds upon which a law might be held invalid as contrary to s 92. First, a law will be invalid if its very purpose is to undermine the freedom guaranteed by s 92. Secondly, a law will be invalid if its means of achieving its legitimate purpose are not "reasonably necessary", in the sense that those means burden the freedom guaranteed by s 92 substantially more than obvious and compelling alternatives which could achieve the purpose of the law to the same extent. Thirdly, and in absolutely exceptional cases, a law will be invalid if its legitimate, but trivial, purpose is inadequate to support the extent of the burden placed upon the high constitutional purpose of s 92. The "structure" in structured proportionality is rigid in its refusal to countenance fictions or hidden grounds for invalidating legislation. As a matter of logic, each stage of the enquiry also follows the preceding stage. The first requires the identification of a legitimate purpose. The second requires assessment of the extent to which the means of achieving that legitimate purpose, not some other – hypothetical or fictional – purpose, is necessary. The third assesses whether, despite the reasonable necessity of the means adopted to achieve the legitimate purpose, the purpose nevertheless cannot justify the burden upon the constitutional freedom. One objection to this form of structured proportionality is that there is no place for the third stage of the analysis. In Betfair Pty Ltd v Western Australia427 the third stage was not mentioned. The third stage requires a comparison of the importance of competing policies, upon which Parliament is far better suited to judge in a representative democracy. There is great force to this objection. In Clubb v Edwards428, I explained why this third basis for invalidating laws must be highly exceptional. The third stage permits the invalidation of a law even though the purpose of the law is legitimate and despite the means adopted being reasonably necessary to achieve that purpose. In other words, invalidation at the third stage of a law that has satisfied the first two stages might have the effect that Parliament can never legislate to achieve that legitimate purpose. Ultimately, however, as I "Section 92: Markets, Protectionism and Proportionality – Australian and European Perspectives" (2010) 36(2) Monash University Law Review 1 at 10, 13-15; Stellios, Zines's The High Court and the Constitution, 6th ed (2015) at 57; Kirk, "Section 92 in its Second Century", in Griffiths and Stellios (eds), Current Issues in Australian Constitutional Law: Tributes to Professor Leslie Zines (2020) 253 at 259; cf Puig, The High Court of Australia and Section 92 of the Australian Constitution (2008) at 143-150; Chordia, Proportionality in Australian Constitutional Law (2020) at 427 (2008) 234 CLR 418 at 464 [48], 477 [102]. 428 (2019) 267 CLR 171 at 341-344 [491]-[498]. Edelman explain later in these reasons, there may be extreme examples of laws whose legitimate but trivial purpose cannot justify a necessary, but extreme, burden upon the important freedom of trade, commerce, and intercourse. Another objection involves an assertion that structured proportionality can have the effect that unspecified factors are ignored or suppressed or that too much weight is put on specified factors. On this view, it is better to allow unspecified factors to roam free, perhaps unmentioned and possibly even subconscious, in a broad evaluative judgment of invalidity. But what are these factors and how would they lead to a conclusion of invalidity? And as to the complaint about excessive weight, why should legislation be held valid if it failed any of the stages of structured proportionality analysis? For instance, is it to be suggested that legislation should be upheld despite having an illegitimate purpose or despite adopting means which burden the s 92 freedom but are not reasonably necessary to achieve its legitimate purpose? Proportionality stage one: the purpose of the law A question which is logically anterior to any other stage of proportionality analysis is whether the law is suitable in that it has a rational connection with a legitimate purpose. In the context of justifying a law that would otherwise be contrary to s 92, the question is most neatly expressed as whether the law has an illegitimate purpose. If one of the very purposes of the legislative provision is to discriminate in the manner prohibited by s 92 then the law cannot be justified. Section 92, as a constitutional norm, could not sanction a law with the very purpose of undermining that norm. The purpose of the legislative provision, in this sense, is the object, goal, or aim of the law rather than merely the effect of the law429. Of course, since purpose or intention can be inferred from likely effect430, a discriminatory effect of the law that is very likely or an obvious substantial disproportion with expressed objects of the law might be bases for an inference that the discrimination was an intended purpose. But a law will only fail at this stage if one of its very purposes is to achieve that which was proscribed. Expressions such as "pointed directly at"431, "aimed 429 See, generally, Unions NSW v New South Wales (2019) 264 CLR 595 at 656-657 [168]-[172]. See also McCloy v New South Wales (2015) 257 CLR 178 at 205 [40]; Brown v Tasmania (2017) 261 CLR 328 at 362 [99], 392 [209], 432-433 [322]. 430 Zaburoni v The Queen (2016) 256 CLR 482 at 488 [8]; SZTAL v Minister for Immigration and Border Protection (2017) 262 CLR 362 at 394-397 [96]-[101]. 431 R v Smithers; Ex parte Benson (1912) 16 CLR 99 at 118. Edelman at"432, or "directed against"433, might be said to be "unsatisfactory" descriptions434 because to the extent that those expressions mean something different from purpose then they should not be sufficient for establishing invalidity. Proportionality stage two: reasonable necessity If the law has a legitimate purpose but has an effect of discriminating between States in trade, commerce, or intercourse, then the next stage of structured proportionality involves asking whether the means used to achieve that legitimate purpose are reasonably necessary for achieving that purpose. As in the context of the implied freedom of political communication435, the question of reasonable necessity in relation to s 92 will be assessed according to the availability and obviousness of means that could achieve the same legitimate purpose to the same extent but without burdening, or with a lesser burden on, the freedom guaranteed by s 92. In Cole v Whitfield436, this Court said that even if the law had conferred an advantage on local trade it would have been justified because the regulation was a "necessary means" of enforcing the prohibition against catching undersized crayfish. But, without the qualification of "reasonableness", a requirement for necessary means might be misunderstood as a test of the ingenuity of counsel. It might imply that a defendant could not justify a law if, as could have been done in this case, counsel for the party challenging the law could identify any manner by which the law's objects could be achieved by any other, less restrictive means. That consequence is avoided by the decisions on s 92 which clarified that this consideration is concerned with whether the law burdens the freedom by means that are more restrictive than is "reasonable" to achieve its purposes437. 432 Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 at 58. 433 Milk Board (NSW) v Metropolitan Cream Pty Ltd (1939) 62 CLR 116 at 127. 434 Compare Cole v Whitfield (1988) 165 CLR 360 at 401. 435 See McCloy v New South Wales (2015) 257 CLR 178 at 210 [57]; Clubb v Edwards (2019) 267 CLR 171 at 336-338 [476]-[480]. 436 (1988) 165 CLR 360 at 409. 437 Uebergang v Australian Wheat Board (1980) 145 CLR 266 at 306; Castlemaine Tooheys Ltd v South Australia (1990) 169 CLR 436 at 469, cf at 480 ("alternative means involving no or a lesser burden"). See also AMS v AIF (1999) 199 CLR 160 Edelman In Betfair Pty Ltd v Western Australia438, consistently with earlier decisions439, six members of this Court said in a joint judgment that the enquiry should be described as one of "reasonable necessity" and that these terms should be "accepted as the doctrine of the Court". In that case, a Western Australian law was held not to be "proportionate" because it was not shown to be reasonably necessary. As the joint judgment explained, there was an apparent legislative alternative, taken by Tasmanian law, which did not involve discrimination440. This description of "reasonable necessity" has been correctly described as a "mirror", to an extent, of the same enquiry in the context of structured proportionality analysis used in relation to the implied freedom of political communication441. It should be emphasised that reasonableness is not a monolithic standard442. In other areas it is now accepted that the threshold of reasonableness, or intensity of review, can vary between different categories of case443. It is enough in this case to say that in the context of s 92 the reasonableness threshold means there will be a margin of appreciation afforded to Parliament before its legislation will be found to fall outside the boundaries of choice of the means by which to implement the legislative purpose. at 179 [45], 233 [221]; APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 353 [38], 393-394 [177], 461 [420]. 438 (2008) 234 CLR 418 at 477 [102]-[103]. 439 See North Eastern Dairy Co Ltd v Dairy Industry Authority of NSW (1975) 134 CLR 559 at 584; Cunliffe v The Commonwealth (1994) 182 CLR 272 at 308. 440 Betfair Pty Ltd v Western Australia (2008) 234 CLR 418 at 479 [110]. 441 McCloy v New South Wales (2015) 257 CLR 178 at 210 [57]. See also Unions NSW v New South Wales (2019) 264 CLR 595 at 615 [42]. 442 See Minister for Immigration and Border Protection v SZVFW (2018) 264 CLR 541 at 567 [59], 574 [84], 584-586 [133]-[135]; Clubb v Edwards (2019) 267 CLR 171 443 Minister for Home Affairs v DUA16 (2020) 95 ALJR 54 at 61 [26]. Edelman Proportionality stage three: adequacy in the balance The final stage of structured proportionality is perhaps the most controversial. It requires asking whether the law is adequate in its balance444. Even if the means adopted by the law are reasonably necessary to achieve its purpose, there will be some cases where the purpose of the law is nevertheless not of sufficient importance to justify the burden that the law places on interstate trade, commerce, or intercourse given the high importance and purpose of s 92 of the Constitution. A law will be inadequate in the balance if, notwithstanding that the law is the only reasonable means of achieving the purpose, the extent of the discrimination and thus the incursion into the freedom of trade, commerce, or intercourse cannot be justified given the purpose of the law445. Considerations of high public policy are involved in this balancing of, on the one hand, Parliament's purpose and, on the other hand, the importance of freedom of trade, commerce, and intercourse and the extent to which that freedom is burdened. A foundational principle of the Constitution is representative democracy, which generally requires that significant policy decisions be left to the branch of government best suited to make them: the Parliament. However, the description of the s 92 freedom as "absolute" supports the possibility of invalidity where Parliament puts a necessary but extreme burden on the subject matter of s 92 in order to achieve a purpose that is trivial, usually assessed by reference to the context and importance that Parliament itself has placed on the purpose. Sections 56 and 67 of the Emergency Management Act are justified in their relevant application Sections 56 and 67 serve a legitimate purpose The plaintiffs' central submission alleged a substantial identity between the Quarantine (Closing the Border) Directions and the Restriction of Interstate Passenger Transport Order held by this Court to be invalid in Gratwick v Johnson446. The primary legislation considered in Gratwick was an open-textured wartime power under the National Security Act 1939 (Cth) to make regulations for securing the public safety and defence of the Commonwealth. The regulations 444 See Clubb v Edwards (2019) 267 CLR 171 at 208 [96], 209 [102], 266-267 [270], 341-344 [491]-[498]; Comcare v Banerji (2019) 93 ALJR 900 at 914 [38], 936 [165]; 372 ALR 42 at 57, 88. 445 cf Clark King & Co Pty Ltd v Australian Wheat Board (1978) 140 CLR 120 at 446 (1945) 70 CLR 1. Edelman made included the National Security (Land Transport) Regulations (Cth), under which a power was exercised to pass the Restriction of Interstate Passenger Transport Order, which, in para 3(a), prohibited travel by rail or commercial passenger vehicle from one State to another without a permit. The Order did not "depend ... for its practical operation or administration upon the movement of troops, munitions, war supplies, or any like considerations". It was "simply based on the 'inter-Stateness' of the journeys"447. On the questionable assumption that the Order would otherwise have been permitted by the primary legislation and regulations, it was held to be invalid. It might have been more accurate to have held the primary legislation invalid insofar as it authorised regulations that would permit such an order. But the key point is that the purposes, not merely the effect, of the Order included discriminating between intrastate and interstate intercourse. The plaintiffs also relied upon the decision in R v Smithers; Ex parte Benson448, where this Court considered the prohibition in s 3 of the Influx of Criminals Prevention Act 1903 (NSW) upon certain criminals entering New South Wales from other States. This Court held that the provision was invalid. Isaacs and Higgins JJ did so on the ground that the provision contravened s 92 of the Constitution. Isaacs J described s 92 as an "absolute prohibition on the Commonwealth and States alike to regard State borders as in themselves possible barriers to intercourse between Australians"449. Higgins J spoke of how the legislation was "pointed directly at the act of coming into New South Wales"450. A natural understanding of these passages, and an explanation for the result, is that s 92 imposes an absolute prohibition upon laws with the object, and not merely the effect, of burdening interstate intercourse. Although one object of s 3 was to reduce the number of criminals in New South Wales, the reasoning of Isaacs and Higgins JJ seemed to be that another object (or, as Isaacs J put it, the "regard" of the State), and not merely an effect, was to discriminate between intrastate intercourse for criminals within New South Wales and interstate intercourse for criminals outside New South Wales. The result in both of these decisions is consistent with the approach to s 92 since Cole v Whitfield, which invalidates a law whose purpose is the very thing that s 92 prohibits: discriminating between the States in relation to intercourse. That is not the case with ss 56 and 67 of the Emergency Management Act. 447 Gratwick v Johnson (1945) 70 CLR 1 at 19. 448 (1912) 16 CLR 99. 449 R v Smithers; Ex parte Benson (1912) 16 CLR 99 at 117. 450 R v Smithers; Ex parte Benson (1912) 16 CLR 99 at 118 (emphasis in original). Edelman Section 56 of the Emergency Management Act was part of the legislation when it was passed in 2005. Its purpose was "to put appropriate arrangements in place to deal with the catastrophic natural or man-made emergencies that may befall our state"451. Section 67 was also part of the 2005 Act but it was amended in 2020 in response to what was described in Parliament as the "unprecedented emergency" after "a state of emergency was declared [on 15 March 2020] in respect of the pandemic caused by COVID-19"452. In each case the manifest purpose was to create, and to make conditional, broad powers for the Minister to manage a broad range of emergencies. The discrimination in ss 56 and 67 is reasonably necessary Even where the purpose of a statutory provision concerns a matter of great public importance, the provision will contravene s 92 if its effect is to impose an excessive discriminatory burden by means which are not reasonably necessary. For instance, in Tasmania v Victoria453 a majority of this Court held invalid an application of s 4 of the Vegetation and Vine Diseases Act 1928 (Vic) which empowered proclamations to prohibit the importation into Victoria of any tree, plant or vegetable which, in the opinion of the Governor in Council, is likely to introduce any disease or insect into Victoria. In a conclusion which would be equally appropriate to the application of the test now accepted for s 92, and in a context in which few vegetables were immune from liability to some disease, Dixon J said that it is absurd to suppose that a State could legislate to provide it with a power454 "entirely uncontrolled to forbid absolutely the importation of a commodity from another State because the State Executive expresses the opinion that a vegetable disease may be introduced if importation is allowed". Sections 56 and 67, in their limited application to a state of emergency constituted by the occurrence of a hazard in the nature of a plague or epidemic, might empower directions which discriminate in an extraordinary way in relation to freedom of trade, commerce, or intercourse. For instance, within the sphere of application of this Court's answer, the sections appear to empower directions as 451 Western Australia, Legislative Assembly, Parliamentary Debates (Hansard), 17 August 2005 at 4120. 452 Western Australia, Legislative Assembly, Parliamentary Debates (Hansard), 31 March 2020 at 1824. 453 (1935) 52 CLR 157. 454 Tasmania v Victoria (1935) 52 CLR 157 at 186. Edelman restrictive as closing all roads and access routes to Western Australia for all purposes and without exception. Such a closure would amount to an impregnable and absolute discriminatory barrier to all trade, commerce, and intercourse that required dealings in person or the contemporaneous transfer of physical things. But despite the possibility of severe discriminatory effects, the terms of ss 56 and 67, in their application as limited in the answer given by this Court, do not exceed the threshold of reasonable necessity because of several significant restrictions. First, an extreme direction such as that described above can only be made under s 67 if the Minister has declared a state of emergency455. That declaration cannot be made unless, relevantly, the Minister: has considered the advice of the State Emergency Coordinator456; is satisfied that an emergency in the nature of a plague or epidemic has occurred or is occurring457; and is satisfied that extraordinary measures are required to prevent or minimise loss of life, prejudice to the safety, or harm to the health, of people458. Secondly, unless the state of emergency is extended by the Minister, which extension cannot exceed 14 days for the purposes of exercising powers under s 67459, it remains in force for only three days460. Thirdly, directions made under s 67 must be "[f]or the purpose of emergency management" during the state of emergency. Section 3 defines "emergency management" as including matters relating to prevention of, preparedness for, response to, and recovery from, the adverse effects of an emergency, relevantly here the occurrence of a hazard in the nature of a plague or epidemic. The requirement that the directions given by an authorised officer be "[f]or the purpose of emergency management" is objective, unlike the subjectivity involved in the proclamation power in Tasmania v Victoria. Although "purpose" bears its usual meaning in this context, namely object or aim, the constraint is significant because the less reasonably necessary an extreme direction is (such as 455 Emergency Management Act, s 56(1). 456 Emergency Management Act, s 56(2)(a). 457 Emergency Management Act, s 56(2)(b). 458 Emergency Management Act, s 56(2)(c). 459 Emergency Management Act, s 58(4). 460 Emergency Management Act, s 57. Edelman closing all roads without exception) the more likely it is that an inference will be drawn that the direction is not solely for the purpose of emergency management. Fourthly, although s 67, unlike s 66(3), does not expressly provide that directions must be "reasonably required for the purposes of emergency management" (emphasis added), the usual implication of reasonableness would confine the discretion of the authorised officer to make directions that are reasonable in light of the purpose of emergency management. Nevertheless, the nature of this usual implication, and the extreme nature of the circumstances in which the power is being exercised, might require the threshold for a finding of legal unreasonableness of any direction to be higher than that which might be conveyed by an express condition of being "reasonably required" for the purpose of emergency management461. The legislative response by Western Australia might have been more limited with less intrusion into the freedom prescribed by s 92. Some simple examples are that the extension of a state of emergency might have been limited to seven days and the power to make directions under s 67 might have been expressly limited to those that are reasonably required. But the existence of such possible lesser intrusions upon the s 92 freedom does not mean that ss 56 and 67 of the Emergency Management Act are invalid in their relevant applications for two reasons. First, although ss 56 and 67 permit applications that burden substantially the s 92 freedom, by allowing for both a wide range of directions that could discriminate and a considerable depth or extent of discrimination, the purpose of the provisions – responding to emergencies – requires a great deal of flexibility. It might be expected that the loss of that flexibility by provisions involving a lesser burden would prevent Parliament's purpose being achieved to the same degree. In other words, the lesser intrusions might not achieve Parliament's purpose to the same degree. Secondly, and in any event, ss 56 and 67 in their particular applications identified by this Court are well within a margin of reasonable legislative responses that minimise the intrusions upon the s 92 freedom. The burden imposed by the Emergency Management Act is adequate in the balance In the context of s 92, a test for adequacy in the balance effectively asks whether the extent of the burden that the law imposes upon the freedom that is prescribed by s 92 can ever be justified by that law's purpose. In other words, the balance is between, on the one hand, the importance of the constitutional freedom of trade, commerce, and intercourse and the extent to which that freedom is burdened by the law and, on the other hand, the purpose of the law that is said to justify that burden. I reiterate that this stage of analysis will only lead to a conclusion of invalidity in extreme circumstances: a conclusion that the law is 461 Minister for Home Affairs v DUA16 (2020) 95 ALJR 54 at 61 [26]. Edelman inadequate in the balance comes very close to saying that Parliament can never legislate to achieve its policy since even a law that is reasonably necessary to achieve that purpose will be invalid. The important purpose of the freedom of interstate intercourse is well summarised by the description by Sir Samuel Griffith of the expected benefits of free intercourse462: "The effects, both social and material, of such an enlargement of knowledge and extension of movement could not fail to be highly beneficial. The present lack of more general acquaintance and intercourse is, indeed, probably one of the most serious obstacles now existing in the way of Federation." An example of a law whose purpose might be considered inadequate when balanced against the weight of the purpose of s 92 and the extent of the burden effected by the law is one which was considered to be "at the least doubtful" in 1903 by Mr Deakin, then Attorney-General of the Commonwealth463. Tasmanian legislation464 imposed a charge for the admission to Tasmania of various categories of person including those who were unable to support themselves or who were likely, "in the opinion of the Collector, to become a charge upon the public". Even assuming that the purpose of decreasing the financial burdens to the State of persons in that relevant class was a legitimate purpose, that purpose might be inadequate in the balance against the discriminatory effect of the law and its undermining of the purpose of s 92. Hence, even if there were no other reasonably available means of reducing those costs, this legislation might be invalid. By contrast, the purpose of public health provisions such as ss 56 and 67 is plainly sufficient to justify even the deep and wide burden that the application of those provisions can place upon the freedom prescribed by s 92. Indeed, at federation it was contemplated that the application of provisions of this nature might be justified despite the imposition of such deep or wide burdens. During the Sydney debates, after one of the delegates, Dr Cockburn, expressed a fear that the clause as drafted might prevent laws prohibiting the passing of cattle across State borders or the introduction of diseased vines into South Australia, Mr O'Connor, 462 Griffith, Notes on Australian Federation: Its Nature and Probable Effects (1896) at 463 See Brazil and Mitchell (eds), Opinions of Attorneys-General of the Commonwealth of Australia (1981), vol 1 at 172-173. 464 Passengers Act 1885 (Tas), s 3. Edelman quoting from a prolific writer from the United States465, set out a good description of the operation of structured proportionality in this area466: "By parity of reason addressed to the protection of the public health, states may exercise their police powers to the extent of prohibiting both persons and animals, when labouring under contagious diseases, from entering their territory. They may pass any sanitary laws deemed necessary for this purpose, and enforce them by appropriate regulations. It is upon this reserved right of self-protection, that quarantines are permitted to interfere with the freedom of commerce and of human intercourse. But this power is not without its limitations, and its exercise must be restricted to directly impending dangers to health, and not to those who are only contingent and remote. Hence, while diseased persons or diseased animals, and those presumedly so from contact with infected bodies or localities, may be prevented from entering a state, any general law of exclusion, measured by months, or operating in such a way as to become a barrier to commerce or travel, would be a regulation of commerce forbidden by the constitution. Such a statute being more than a quarantine regulation, transcends the legitimate powers of a state." Subsequently, Mr Barton said, in terms reflecting the first stage of structured proportionality, that "the power to prevent the introduction of diseases would still remain with the states, except in so far as any state law was found to be an intentional derogation from the freedom of trade"467. Conclusion For these reasons, I join in the orders that were made on 6 November 2020. 465 Ordronaux, Constitutional Legislation in the United States: Its Origin, and Application to the Relative Powers of Congress, and of State Legislatures (1891) at 466 Official Record of the Debates of the Australasian Federal Convention (Sydney), 22 September 1897 at 1062. 467 Official Record of the Debates of the Australasian Federal Convention (Sydney), 22 September 1897 at 1064.

HIGH COURT OF AUSTRALIA XYZ AND PLAINTIFF THE COMMONWEALTH OF AUSTRALIA DEFENDANT XYZ v The Commonwealth [2006] HCA 25 Date of Order: 17 November 2005 Date of Publication of Reasons: 13 June 2006 ORDER The questions set out in the Case Stated dated 2 June 2005 are answered as follows: Is either of sections 50BA and 50BC of the Crimes Act 1914 (Cth) a law "with respect to … External affairs" within section 51(xxix) of the Constitution? Yes, both of them. If the answer to question (1) is "no", is either of sections 50BA and 50BC of the Crimes Act 1914 (Cth) otherwise a valid law of the Commonwealth? This question does not arise. By whom should the costs of the Case Stated to the Full Court of this Honourable Court be borne? The plaintiff. Representation: S J Gageler SC with K L Walker for the plaintiff (instructed by Buxton & Associates) D M J Bennett QC, Solicitor-General of the Commonwealth with R J Orr for the defendant (instructed by Australian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Constitutional law (Cth) – External affairs – Plaintiff charged with three offences of engaging in sexual activity with a child under 16 years while outside Australia contrary to ss 50BA and 50BC of the Crimes Act 1914 (Cth) – Whether either of ss 50BA and 50BC of the Crimes Act are laws with respect to external affairs – Whether "external affairs" extends to any place, person, matter or thing lying outside the geographical limits of Australia – Whether "external affairs" is restricted to subjects having some connection with Australia – Whether "external affairs" is restricted to matters touching or concerning the relationships of Australia with other countries and international organisations – Whether "external affairs" extends to "matters of international concern" – Relevance of proposition treaty obligations. that "external affairs" extends implementation of Constitutional law (Cth) – Constitutional interpretation – Whether permissible to consider separately the meaning of components of a composite phrase – Relevance of distorting or alarming possibilities – Relevance of possible lacuna in the plenitude of the combined legislative powers of the various Parliaments of the Australian federation – Relevance of original meaning of the Constitution – Relevance of development of Australian nationhood – Relevance of extra- territorial reach of other heads of legislative power in s 51 to the interpretation of s 51(xxix) – Relevance of principles of international law concerning extra- territorial the legislation – Relevance of Commonwealth – Relevance of notion of proportionality. federal character of the Constitutional law (Cth) – Overruling – Whether leave necessary to reopen such authority of the Court as upheld the geographical externality principle – Whether such authority should be overruled. Criminal law – Sexual offences – Child sex tourism offences – Crimes Act 1914 (Cth), ss 50BA, 50BC – Whether such offences valid laws under the Constitution. Words and phrases – "external affairs". Constitution, ss 51(xxix), 51(xxxviii). Australia Act 1986 (Cth), s 2. Crimes Act 1914 (Cth), ss 50AD, 50BA, 50BC. Criminal Code (Cth), s 11.1(1). GLEESON CJ. The issue in this case concerns the constitutional validity of legislation enacted by the Parliament which makes it a criminal offence, punishable by the law of Australia, for an Australian citizen or resident, while outside Australia, to engage in certain forms of sexual activity involving children. The Court was informed that legislation of that nature (aimed primarily at what is sometimes called "sex tourism") has been enacted by some 34 countries. The power relied upon to support the legislation is that conferred by s 51(xxix) of the Constitution, that is, the power to make laws for the peace, order, and good government of the Commonwealth with respect to external affairs. Sections 50BA and 50BC of the Crimes Act 1914 (Cth) respectively make it an offence for a person, while outside Australia, to engage in sexual intercourse with a person under 16, or to commit an act of indecency on a person under 16. By virtue of s 50AD, the first-mentioned "person" relevantly means a person who was, at the time of the offence, an Australian citizen or a resident of Australia. The plaintiff is an Australian citizen. He has been committed for trial in Victoria for offences against the above laws. The offences are said to have been committed in Thailand in 2001. The alleged victim is neither a citizen nor a resident of Australia. By a case stated, questions as to the validity of the laws were reserved for the decision of a Full Court. Those questions were answered at the conclusion of argument. The Court held that the legislation is valid, and said that reasons would be given at a future date. No issue of statutory construction arises. That the legislation has, or purports to have, extra-territorial effect is clear. In terms, it relates to conduct outside Australia, but is limited in its operation to the conduct of Australian citizens or residents. Within Australia, territorial legislative jurisdiction with respect to crimes involving sexual abuse of children is exercised by the State and Territory legislatures. The assertion of extra-territorial criminal jurisdiction is not, in itself, contrary to the principles of international law. As has already been noted, an exercise of extra-territorial jurisdiction in respect of this kind of offence has been undertaken by many other countries. The territorial principle of legislative jurisdiction over crime is not the exclusive source of competence recognised by international law. Of primary relevance to the present case is the nationality principle, which covers conduct abroad by citizens or residents of a state. Jurisdiction is also exercised by states under the passive nationality principle, under which foreigners are punished for conduct harmful to nationals of the legislating state, the principle which enables protection of the security of the state, and principles concerning the repression of certain kinds of crime1. 1 Generally, see Brownlie, Principles of Public International Law, 6th ed (2003) at 299-306; Oppenheim's International Law, 9th ed (1992), vol 1 at 456-479; In re Piracy Jure Gentium [1934] AC 586 at 589. The fact that international law does not regard criminal jurisdiction as limited to jurisdiction based upon the territorial principle is relevant to the nature of external affairs. It identifies a topic of potential concern to a national legislature. The relevance does not result from any limiting effect upon the construction of the Constitution. Section 51 is a grant of legislative power, and the fact that conceptions of state sovereignty, both at common law and in international law, embrace the existence of a power of the kind exercised by the legislation in question is of assistance in giving content to the constitutional idea of external affairs. The considerations that there are other bases of jurisdiction, that their boundaries are not entirely clear, that the practice of states in asserting extra-territorial jurisdiction varies, and that such assertions may give rise to difficulties in international relations are additional reasons for not giving the power a narrow and confined meaning. Although the present case is not concerned with legislation governing, or purporting to govern, the conduct of foreigners in foreign countries, there are well-known examples of assertions by states of legislative competence of that kind, extending to conduct of foreigners which is lawful where it occurred. Antitrust legislation of the United States of America is one such case. In cases of ambiguity, rules of construction may guide the interpretation of legislation so as to conform to international law2. In this Court, in Meyer Heine Pty Ltd v China Navigation Co Ltd3, early Commonwealth legislation against anti-competitive conduct was construed as applying only to conduct within Australia. Three aspects of that decision should be noted. First, the legislation was enacted in 1906, and amended in 1910, at a time when there was still "an uncertain shadow upon the competence of the Australian Parliament to pass an Act having extra-territorial operation"4. Secondly, there was in the language of the legislation itself a very clear indication that its operation was territorially confined. That was a decisive consideration in the reasoning of the majority. Thirdly, Taylor J said that the presumption of territoriality was a rule of interpretation only "and, if by a local statute otherwise within power, provision is made 'in contravention of generally acknowledged principles of international law' it is binding upon and must be enforced by the courts of this country"5. Anti-terrorist legislation provides another example of circumstances in which many states are concerned to legislate with respect to conduct occurring outside their territorial borders, and with respect to conduct of foreigners. 2 R v Jameson [1896] 2 QB 425 at 430. (1966) 115 CLR 10. (1966) 115 CLR 10 at 43 per Windeyer J. (1966) 115 CLR 10 at 31. Where a state legislates with respect to the conduct abroad of its citizens and residents, and exercises judicial power only upon their return, there is ordinarily no invasion of the domestic concerns of the place where the conduct occurred. Plainly, however, it may be otherwise when other jurisdictional principles are invoked in aid of extra-territorial legislative competence. Professor Brownlie has summarised the effect of international law as follows6: "Extra-territorial acts can only lawfully be the object of jurisdiction if certain general principles are observed: (iii) that there should be a substantial and bona fide connection between the jurisdiction; the subject-matter and the source of that the principle of non-intervention in the domestic or territorial jurisdiction of other states should be observed; that a principle based on elements of accommodation, mutuality, and proportionality should be applied. Thus nationals resident abroad should not be constrained to violate the law of the place of residence." No doubt the provisions of s 50AD of the Crimes Act, confining (so far as is presently relevant) the operation of the legislation to the conduct of Australian citizens and residents, are explained in part by a desire on the part of the Parliament to conform to international expectations, and to confine the operation of extra-territorial legislation to a basis that is internationally accepted. As was noted earlier, we are not here concerned with a problem of construction of the Crimes Act. Legislation, including criminal legislation, is commonly expressed without territorial reference, and is construed and applied on the understanding "that the legislature of a country is not intending to deal with persons or matters over which, according to the comity of nations, the jurisdiction properly belongs to some other sovereign or State"7. This legislation is expressed to apply to conduct outside Australia, but only where engaged in by persons over whom Australia, according to the comity of nations, has jurisdiction. Nor are we concerned with legislation which manifests a clear intention to reach beyond bounds that would be regarded as acceptable according to the comity of nations. 6 Brownlie, Principles of Public International Law, 6th ed (2003) at 309. 7 Niboyet v Niboyet (1878) 4 PD 1 at 7, cited by Dixon J in Barcelo v Electrolytic Zinc Co of Australasia Ltd (1932) 48 CLR 391 at 424. See also R v Jameson [1896] 2 QB 425 at 430 per Lord Russell of Killowen CJ. The issue raised in the present case is whether a law which applies to conduct outside Australia by Australian citizens or residents is within the legislative competence of the Parliament as being a law for the peace, order, and good government of Australia with respect to external affairs. The resolution of the issue turns upon the construction of the Constitution and, in particular, the expression "external affairs". It is not argued that the formula "for the peace, order, and good government of the Commonwealth" imports any relevant limitation on legislative power8. The argument for the plaintiff is that the Parliament's power to make laws with respect to external affairs is, and is only, a power to make laws with respect to relations between Australia and other countries. Because, in 1901, those other countries included Great Britain and other parts of the British Empire, "external affairs" was regarded as a more appropriate expression than "foreign affairs". Great Britain was not then "foreign". The power, it is said, was conferred to allow the Commonwealth Parliament to enact legislation regulating "relations between Australia and other countries, including other countries within the Empire"9. This, in 1901, and for many years thereafter, was seen as "the substantial subject matter of external affairs"10. The corollary of the argument is that s 51(xxix) does not confer a general power to legislate extra-territorially. For this argument to succeed, it would be necessary for the Court to depart from the decision in Polyukhovich v The Commonwealth11, and to decide that the construction placed upon s 51(xxix) by every member of the Court in that case was wrong. In my view, the Court, upon reconsideration, should hold that Polyukhovich was correctly decided insofar as the decision bears upon the question of construction that arises in this case. Insofar as the decision goes beyond that, and bears, for example, upon Ch III of the Constitution, it is not presently relevant and it is unnecessary and inappropriate to say anything further about it. There was a difference between the view of s 51(xxix) taken by Mason CJ, Deane J, Dawson J, Gaudron J and McHugh J, on the one hand, and the views of Brennan J and Toohey J on the other. That difference does not affect the point presently in issue. Polyukhovich held that the external affairs power covers, but is not limited to, the matter of Australia's relations with other countries. It also includes a power to make laws with respect to places, persons, matters or things outside the geographical limits of, that is, external to, cf Polyukhovich v The Commonwealth (1991) 172 CLR 501 at 635-636 per Dawson J, 695 per Gaudron J. 9 R v Burgess; Ex parte Henry (1936) 55 CLR 608 at 643 per Latham CJ. 10 R v Burgess; Ex parte Henry (1936) 55 CLR 608 at 643. 11 (1991) 172 CLR 501. Australia12. That conclusion represents the current doctrine of the Court on the external affairs power, and should be maintained because it is correct. In Victoria v The Commonwealth ("the Payroll Tax Case")13 Windeyer J, explaining the constitutional consequences of certain developments during the twentieth century, said: "The Colonies which in 1901 became States in the new Commonwealth were not before then sovereign bodies in any strict legal sense; and certainly the Constitution did not make them so. They were self- governing colonies which, when the Commonwealth came into existence as a new Dominion of the Crown, lost some of their former powers and gained no new powers. They became components of a federation, the Commonwealth of Australia. It became a nation. Its nationhood was in the course of time to be consolidated in war, by economic and commercial integration, by the unifying influence of federal law, by the decline of dependence upon British naval and military power and by a recognition and acceptance of external interests and obligations." The development of Australia's nationhood, which included the shedding of inhibitions on its capacity to legislate extra-territorially, and the attainment and maturing of its international status as an independent state rather than a component part of the British Empire, inevitably had consequences for the practical content of the constitutional concept of external affairs. No clearer example of the consequences of that development could be given than one which touches a matter of history upon which the argument for the plaintiff relies. It is true that, in considering the matter of Australia's relations with Great Britain and the other parts of the Empire, Australians in the late nineteenth century would not have described those as "foreign" relations or affairs. Yet, 100 years later, four members of this Court14, in Sue v Hill15, held that the United Kingdom was a "foreign power" within the meaning of that expression in s 44 of the Constitution. Reference was made to statements by Windeyer J in Bonser v La Macchia16 that 12 Polyukhovich v The Commonwealth (1991) 172 CLR 501 at 528 per Mason CJ, 602 per Deane J, 632 per Dawson J, 696 per Gaudron J, 714 per McHugh J; Horta v The Commonwealth (1994) 181 CLR 183; Victoria v The Commonwealth (The Industrial Relations Act Case) (1996) 187 CLR 416 at 485 per Brennan CJ, Toohey, Gaudron, McHugh and Gummow JJ. 13 (1971) 122 CLR 353 at 395-396. 14 Gleeson CJ, Gaudron J, Gummow J and Hayne J. 15 (1999) 199 CLR 462. 16 (1969) 122 CLR 177 at 223-224. the law had followed the facts, and that Australia had become "by international recognition ... competent to exercise rights that by the law of nations are appurtenant to, or attributes of, sovereignty"17. The developments in nationhood and international status that affected so profoundly Australia's relationship with the United Kingdom have also affected the nature of the external affairs that are now of potential legislative concern. The same developments have been recognised for their effect upon the practical content of the power to make laws with respect to naturalization and aliens. An example of such recognition is Nolan v Minister for Immigration and Ethnic Affairs18. The rights that, by the law of nations, are regarded as appurtenant to, or attributes of, sovereignty include the right to regulate, by legislation, the conduct outside Australia of Australian citizens or residents. That is not the full extent of the right, but it is sufficient for present purposes. If the argument for the plaintiff is correct, how is that right now to be exercised by, or on behalf of, Australia? This was the concern raised by Jacobs J in New South Wales v The Commonwealth ("the Seas and Submerged Lands Act Case")19. In that case counsel for Victoria put the same argument as has been put for the plaintiff in this case. The argument is reported as follows20: "A law is not within s 51(xxix) simply because it deals with or operates upon a thing which is outside Australia. The subject matter is restricted to things which are the subject of the relations between Australia and other countries. The word 'affairs' in par (xxix) is apt to describe relationships between governments." Jacobs J's response21 to that argument is worth quoting in full, because of its influence on later decisions, especially Polyukhovich: "The words 'external affairs' must be given their ordinary meaning. It is true that the operation of the power may have been limited in 1900 by the concept that Australia, lacking sovereignty, could legislate only for its territory; but that limitation, if it existed, did not alter the meaning of the words. It is not a sufficient reason for reading down the meaning of these words that there are other provisions of the Constitution, eg s 51(xxx), which expressly confer power to legislate with extra-territorial effect or which, eg s 51(x), may place a particular limitation in favour of the States on the power to legislate extra-territorially. 17 (1999) 199 CLR 462 at 487. 18 (1988) 165 CLR 178. 19 (1975) 135 CLR 337. 20 (1975) 135 CLR 337 at 347. 21 (1975) 135 CLR 337 at 497-498. The express power of the Australian Crown to make laws with respect to places outside, or matters or things done outside the boundaries of the Commonwealth is no more fettered by notions of extra-territoriality than is the power possessed by the British Crown. That power attached to the British Crown by virtue of the pre-eminence and excellence which it claimed and which, even though there be limitations imposed by the common law itself as well as by statute on its exercise by the Crown in Council, is wholly without limit when exercised by the Crown in Parliament. Hence sprang the sovereignty of the British Parliament at Westminster and it followed that no statute of that Parliament could be held invalid on any ground whatsoever, even if it invaded the rights of the Crown or of the subject under the common law, even if it operated extra- territorially and even if it violated international law. Clearly the Crown in the Australian Executive Council and in the Australian Parliament has one bound which the British Parliament has not, for it cannot transgress the Constitution. But subject to that Constitution it in Council and in Parliament has that pre-eminence and excellence as a sovereign Crown which is possessed by the British Crown and Parliament. Exactly when it attained those qualities is a matter of the constitutional history of the British Commonwealth of Nations largely reflected in the Imperial Conferences following the Great War. Legal recognition came through the Statute of Westminster, 1931 and its later adoption by Australia. Now the Constitution is the only limitation. There is no gap in the constitutional framework. Every power right and authority of the British Crown is vested in and exercisable by the Crown in Australia subject only to the Constitution. The State legislatures do not have that sovereignty which the British legislature and now the Australian legislature possess. A State can only legislate in respect of persons acts matters and things which have a relevant territorial connexion with the State, a connexion not too remote to entitle the law to the description of a law for the peace welfare and good government of the State ... The words of s 51 of the Constitution do not import any similar territorial limitation and there now is none in the case of the Australian legislature. The words 'external affairs' can now be given an operation unaffected by any concept of territorial limitation. The result is that the Commonwealth, outside the boundaries of the States and subject to any particular constitutional injunctions, may make laws on all subject matters in exercise of its sovereignty." That reasoning was criticised in argument in the present case as having been based upon a misconception as to the limits of State legislative power. The capacity of State Parliaments to enact legislation with extra-territorial reach, a matter now dealt with in the Australia Act 1986 (Cth), s 2(1), was discussed in Union Steamship Co of Australia Pty Ltd v King22, and more recently in Mobil Oil Australia Pty Ltd v Victoria23. State legislation requires a relevant territorial connection, but the test of relevance is to be applied liberally, and even a remote or general connection will suffice24. Jacobs J was writing before Union Steamship, but Polyukhovich was decided after that case, and in Polyukhovich Deane J (who had been a party to the joint judgment in Union Steamship) expressly agreed with the passage from the judgment of Jacobs J quoted above25. Dawson J also emphasised the point that had been made by Jacobs J26. The legislation presently in question provides a compelling example of the matter that concerned Jacobs J. Let it be assumed that, consistently with conceptions of sovereignty, it is of legitimate concern for Australia to regulate the conduct, outside Australia, of Australian citizens and residents in relation to sexual abuse and exploitation of children. The proposition that Australia's capacity to respond to that concern depends upon legislative activity by the States and Territories is surprising. The plaintiff is a citizen of Australia. Presumably, on the plaintiff's argument, it would be for the Parliament of Victoria to regulate his conduct in Thailand. And, presumably, legislative competence would be based upon his Victorian residence. Even if that were sufficient connection, on the plaintiff's approach, Australia's capacity to deal with the phenomenon of sex tourism would be limited to the existence of a pattern of potentially different State and Territory legislation. The problem would be even more obvious in cases of extra-territorial legislation based upon the passive nationality principle or the principle of protecting Australia's security. What State power would extend to the enactment of a law aimed at conduct of foreigners, abroad, threatening or damaging Australians or their property? Would a State law against terrorist activity abroad aimed at Australian persons or property be limited to activity aimed at persons or property in that State? There are some forms of extra-territorial legislation that would not have even a remote or general connection with the States. If the Commonwealth Parliament cannot legislate with respect to such matters, then the federal system "denies the completeness of Australian legislative power"; a conclusion which, as 22 (1988) 166 CLR 1. 23 (2002) 211 CLR 1. 24 (2002) 211 CLR 1 at 22-23 [9]. 25 (1991) 172 CLR 501 at 603. 26 (1991) 172 CLR 501 at 638. Dawson J said in Polyukhovich, "is unacceptable in terms of constitutional theory and practice"27. To deny to the Commonwealth Parliament the power for which the defendant contends would expose a substantial weakness in Australia's capacity to exercise to the full the powers associated with sovereignty. The plaintiff argues that this potential weakness is either non-existent, or exaggerated. In that respect only, the plaintiff invokes State and Territory legislative power and additionally points to s 51(xxxviii). If the power of the Commonwealth Parliament to legislate extra-territorially to the same extent as could the Parliament of the United Kingdom at 1901 depends upon the concurrence of the Parliaments of all the States, that supports the point made by Jacobs J. Although the plaintiff points to State legislative power to answer the defendant's argument, the dispute about the meaning of s 51(xxix) that arises in this case is not one that raises the kinds of concern about what is sometimes referred to as the federal balance that are raised by some other disputes about that provision28. It is the aspect of the external affairs power that the plaintiff acknowledges, and asserts constitutes its entire content, that gives rise to problems of that kind. The plaintiff accepts that the power at least includes power to make laws with respect to matters affecting Australia's relations with other countries, and that includes matters the subject of treaties entered into by Australia. It has sometimes been said that, if a subject matter is of international and not purely domestic concern, that is itself enough to make that subject matter a part of Australia's external affairs. This was said, for example, by Stephen J, in Koowarta v Bjelke-Petersen29, in a context where his Honour equated matters of international concern with areas properly the subject matter of international agreement. Indeed, in this case, the defendant, as an alternative submission, put that prohibition of conduct involving the abuse and exploitation of children is itself a matter of international concern, and of concerted international action. Because the defendant's primary argument, based on externality, should be accepted, it is unnecessary to resolve that question. The argument, however, and the potential width of a concept which may go beyond obligations assumed by Australia under a treaty, to matters that could properly be the subject of a treaty the potential for extension of illustrates Commonwealth legislative capacity by resort to what is, in this case, the uncontroversial aspect of s 51(xxix). The range of topics that might, on one view, be described as being of international concern, is wide and constantly that be what is meant), 27 (1991) 172 CLR 501 at 638. 28 Polyukhovich v The Commonwealth (1991) 172 CLR 501 at 632 per Dawson J. 29 (1982) 153 CLR 168 at 217. increasing. We do not need, in this case, to address the problem that arises from the need to relate the external affairs power to the federal scheme. That problem arises out of what is, on the plaintiff's argument, the essence of s 51(xxix). We are here concerned with that aspect of s 51(xxix) that allows the Australian body politic to exercise the plenitude of power which flows from nationhood and independence. That involves no threat to the legislative capacity of the States. The reasoning in Polyukhovich was criticised as being based upon inappropriate literalism. In particular, it was said to be erroneous to consider, separately, the meanings of "external" and "affairs", and build a composite meaning from the result. There are many instances where it is misleading to construe a composite phrase simply by combining the dictionary meanings of its component parts30. In the law of defamation, "public interest" does not mean "of interest to the public"; and it may be doubted that a topic is relevantly of international concern simply because it is discussed at an overseas conference. The argument, however, does not do justice to the reasoning in Polyukhovich, which was based upon a consideration of the constitutional consequences of Australia's emergence as a nation, and its independence of Great Britain. Furthermore, the alternative solution offered by the plaintiff, said to involve a purposive construction, is in truth founded upon an incomplete and inadequate description of the relevant purpose. As was emphasised in Sue v Hill31, the framers of the Constitution were building for the future, and creating a union that would become an independent nation. The Constitution's purpose is not to be taken to be circumscribed by the circumstances of dependence which then applied. Indeed, in 1901 much of what was involved in Australia's relations with other countries was attended to in London rather than in Australia. If the grant of power were not forward-looking, its scope would have been quite limited. Just as the United Kingdom has now become a foreign power, Australia has attained full independence, and the kinds of matters of extra-territorial legislative concern that were potentially the subject of regulation by the United Kingdom Parliament are now potentially part of the external affairs with which the Australian Parliament may be concerned. It is for those reasons that I joined in the answers to the questions in the case stated that were announced at the conclusion of argument. 30 eg General Accident Fire and Life Assurance Corporation Ltd v Commissioner of Pay-roll Tax [1982] 2 NSWLR 52. In the course of argument before the Privy Council, Lord Wilberforce remarked that an Australian who looked up the words "commission" and "agent" in a dictionary would probably be surprised to be told that, in England, a commission agent is a bookmaker. 31 (1999) 199 CLR 462 at 487-488 [51]-[52] per Gleeson CJ, Gummow and Hayne JJ, 524-525 [162] per Gaudron J. Crennan GUMMOW, HAYNE AND CRENNAN JJ. The plaintiff is an Australian citizen. On 18 September 2003, he was committed to stand trial in the County Court of Victoria on three charges of offences, each alleged to have been committed in Thailand between 4 July 2001 and 13 December 2001. The first charge was that the plaintiff engaged in sexual intercourse with a child under 16 years, contrary to s 50BA(1) of the Crimes Act 1914 (Cth) ("the Crimes Act"). The second charge was that he attempted to engage in sexual intercourse with a child under 16 years contrary to s 50BA(1) of the Crimes Act and s 11.1(1) of the Criminal Code (Cth) ("the Code"). The third charge was that he committed an act of indecency on a child under 16 years contrary to s 50BC(1)(a) of the Crimes Act. The child referred to in the charges is not and never has been an Australian citizen or resident. When committed to stand trial on the charges, the plaintiff entered a plea of not guilty. On 17 January 2005, the Commonwealth Director of Public Prosecutions filed an indictment in the County Court of Victoria alleging the commission by the plaintiff of the acts identified in each of the charges. In advance of his arraignment in the County Court, the plaintiff, on 25 February 2005, instituted an action in the original jurisdiction of this Court seeking a declaration that ss 50BA and 50BC of the Crimes Act are not valid laws of the Commonwealth. A Justice stated a case for consideration of the Full Court under s 18 of the Judiciary Act 1903 (Cth). The following questions were reserved by the case stated for the consideration of the Full Court: Is either of sections 50BA and 50BC of the [Crimes Act] a law "with respect to ... External affairs" within section 51(xxix) of the Constitution? If the answer to question (1) is "no", is either of sections 50BA and 50BC of the [Crimes Act] otherwise a valid law of the Commonwealth? By whom should the costs of the case stated to the Full court of this Honourable court be borne? At the conclusion of the hearing by the Full Court on 17 November 2005, the Court answered the questions as follows: (1) Yes, both of them. This question does not arise. The plaintiff. Crennan What follows are our reasons for joining in the order made on 17 November 2005. The legislation Sections 50BA and 50BC are included in Pt IIIA of the Crimes Act (ss 50AA-50GA). This Part is headed "Child Sex Tourism" and was inserted into the Crimes Act by s 3 of the Crimes (Child Sex Tourism) Amendment Act 1994 (Cth). The legislation has since been amended by the Law and Justice Legislation Amendment (Application of Criminal Code) Act 2001 (Cth)32. Section 50BA(1) states: "A person must not, while outside Australia, engage in sexual intercourse with a person who is under 16. Penalty: Imprisonment for 17 years." Paragraph (a) of s 50BC(1) states: "A person (the first person) contravenes this section if, while the first person is outside Australia: the first person commits an act of indecency on a person who is under 16". Section 50AD, so far as material, provides: "A person must not be charged with an offence against this Part that the person allegedly committed outside Australia unless, at the time of the offence, the person was: an Australian citizen; or a resident of Australia". The second charge, that of attempting to engage in sexual intercourse with a child under 16 years, is founded upon s 50BA(1) of the Crimes Act supported by s 11.1(1) of the Code. The Code provision states: 32 Sched 10. Crennan "A person who attempts to commit an offence is guilty of the offence of attempting to commit that offence and is punishable as if the offence attempted had been committed." As already indicated, the plaintiff contended that ss 50BA and 50BC were invalid because neither was a law supported by the external affairs power in s 51(xxix) of the Constitution. The questions stated for and answered by the Full Court identified the two sections without confining them to s 50BA(1) and par (a) of s 50BC(1), but no point was taken on that account. We proceed on the footing that, if s 50BA(1) and par (a) of s 50BC(1) are valid, the provisions as a whole are valid. It also is to be remarked that the answer by the Full Court that s 50BA and s 50BC are valid did not confine the reach of the external affairs power to acts allegedly committed outside Australia by Australian citizens or residents. The modern doctrine In the joint judgment of five members of the Court in the Industrial Relations Act Case33, it was said: "The modern doctrine as to the scope of the power conferred by s 51(xxix) was adopted in Polyukhovich v The Commonwealth34. Dawson J expressed the doctrine in these terms35: '[T]he power extends to places, persons, matters or things physically external to Australia. The word "affairs" is imprecise, but is wide enough to cover places, persons, matters or things. The word "external" is precise and is unqualified. If a place, person, matter or thing lies outside the geographical limits of the country, then it is external to it and falls within the meaning of the phrase "external affairs".' 33 Victoria v The Commonwealth (1996) 187 CLR 416 at 485 per Brennan CJ, Toohey, Gaudron, McHugh and Gummow JJ. 34 (1991) 172 CLR 501. 35 (1991) 172 CLR 501 at 632. Crennan Similar statements of the doctrine are to be found in the reasons for judgment of other Justices: Mason CJ36; Deane J37; Gaudron J38; and McHugh J39. They must now be taken as representing the view of the Court." In the present case, the "matter or thing" which lies outside the geographical limits of Australia is the conduct proscribed by the terms of ss 50BA and 50BC of the Crimes Act ("A person must not" and "A person ... contravenes this section if" respectively). The result is that the proscribed conduct falls within the meaning of the phrase "external affairs" and supplies a sufficient "constitutional fact". Such an outcome is consistent with what was foreseen by Dixon J in R v Burgess; Ex parte Henry40. His Honour accepted that the power conferred by s 51(xxix) would enable the Parliament to make laws operating outside the limits of the Commonwealth, even if the "primary purpose" of the head of power was not to regulate conduct occurring abroad. Dixon J added41: "The limits of the power can only be ascertained authoritatively by a course of decision in which the application of general statements is illustrated by example." The case law The plaintiff's primary submission is that s 51(xxix) does not support a law "simply because that law operates on matters or events outside Australia". The Commonwealth submits to the contrary. The plaintiff further contends that, to the extent that this Court held otherwise in Polyukhovich42 and Horta v The 36 (1991) 172 CLR 501 at 528-531. 37 (1991) 172 CLR 501 at 599-603. 38 (1991) 172 CLR 501 at 695-696. 39 (1991) 172 CLR 501 at 712-714. 40 (1936) 55 CLR 608 at 668-669. 41 (1936) 55 CLR 608 at 669. See also the remarks of Deane J in The Commonwealth v Tasmania (The Tasmanian Dam Case) (1983) 158 CLR 1 at 258. 42 (1991) 172 CLR 501. Crennan Commonwealth43, those decisions are incorrect and should be overruled. The considered statement in the Industrial Relations Act Case44, set out above, was said to be but comment made in passing. At the time the information against him was laid, Polyukhovich was an Australian citizen and resident45 and the charges arose out of events in the then Soviet Union during the Second World War, in which Australia had been allied to the Soviet Union. As to Horta, there was an obvious and substantial nexus between Australia and exploration for petroleum resources in the Timor Gap46. Hence, the outcome in those cases might be supported upon a qualified view of the scope of the external affairs power. Two further authorities should be mentioned here. In De L v Director- General, NSW Department of Community Services47, the Court upheld the validity of regulations made under the Family Law Act 1975 (Cth), whose support by the Hague Convention respecting international child abduction was called into question. In the joint judgment of six members of this Court, it was said of this submission48: "The subject matter of the Regulations, the return of children abducted from Australia and the return of children abducted to Australia, is concerned with the movement of children between Australia and places physically external to Australia. It thus falls within the content of the phrase 'external affairs' in s 51(xxix) of the Constitution. Accordingly, the legislative authority for the making of the Regulations, found in s 111B [of the Family Law Act], is to be supported in this sense as a law with 43 (1994) 181 CLR 183. 44 (1996) 187 CLR 416 at 485. 45 (1991) 172 CLR 501 at 523. 46 (1994) 181 CLR 183 at 194. See further Commonwealth v WMC Resources Ltd (1998) 194 CLR 1. 47 (1996) 187 CLR 640. 48 (1996) 187 CLR 640 at 650 per Brennan CJ, Dawson, Toohey, Gaudron, McHugh Crennan respect to external affairs49 independently of the Convention50, and the Regulations, in turn, take this character." The citation of the Industrial Relations Act Case as containing an authoritative exposition of the external affairs power should be noted. Thereafter, in R v Hughes51, the view was expressed by all members of this Court that a federal law regulating the placing by Australian investors of moneys in the United States would attract s 51(xxix). The law would relate to matters territorially outside Australia but would touch and concern Australia. Several points are to be made respecting these authorities. The first is that what was said in Hughes and decided in Polyukhovich, Horta and De L concerned legislation which touched and concerned Australia. Accordingly, these authorities may be supported on a narrower reading of s 51(xxix) than the requirement of a geographically external matter or thing, as urged by the Commonwealth and denied by the plaintiff. The second concerns the plaintiff's challenge to the broader reasoning apparent in these cases and the need for the plaintiff first to obtain leave before pressing his point to conclusion. It is unnecessary to embark upon the question of what is involved in the statement in the joint judgment in Evda Nominees Pty Ltd v Victoria52 that leave of the Court is required before the Court hears argument urging it to depart from "the actual decision" in earlier cases53. That is because any re-opening would be futile. The reading of s 51(xxix) accepted in the Industrial Relations Act Case is correct and denies the reading for which the plaintiff contends in the present case. The construction of s 51(xxix) The broad terms in which heads of legislative power may be expressed in the Constitution do not provide a sound basis for a reading which restricts their scope out of fear of some distorting or alarming possibility. The point has been 49 Industrial Relations Act Case (1996) 187 CLR 416 at 485, 566-568, 571-572. 50 Industrial Relations Act Case (1996) 187 CLR 416 at 486-489, 566-568, 571-572. 51 (2000) 202 CLR 535 at 556 [42], 583 [118]. 52 (1984) 154 CLR 311 at 316. 53 As to stare decisis in constitutional cases, see Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 554. Crennan made in this Court on various occasions54. One such distorting possibility has had an apparent influence upon some minority judgments in cases upholding legislation based upon treaties touching "domestic" matters. But that particular concern is of no moment in the present case. The distinction was explained as follows by Dawson J in the course of his judgment upholding the legislation challenged in Polyukhovich. His Honour remarked55: "In perceiving that the Constitution requires the exclusion of domestic matters from the ambit of the external affairs power, I have elsewhere pointed to the division of legislative power between the Commonwealth and the States and have observed that, if international concern over entirely domestic matters were sufficient to bring those matters within the external affairs power, par (xxix) would have the potential to obliterate the division which s 51 was intended to effect. To construe par (xxix) in that way would be to disregard entirely its constitutional setting." "But if, as I think to be the case, it is necessary to have regard to the scheme of the Constitution in construing the external affairs power, the result is different with regard to circumstances external to Australia. For although the sovereignty of the Australian nation is divided internally between the Commonwealth and the States, there is no division with respect to matters which lie outside Australia. There the sovereignty of the nation is the sovereignty of the Commonwealth which may act as if it were a unitary state without regard to the 'conceptual duality' within Australia to which Stephen J referred to in the Seas and Submerged Lands Case57. There is no corresponding capacity on the part of the States, either singly or together." 54 Western Australia v The Commonwealth ("the Territorial Senators Case") (1975) 134 CLR 201 at 271, 275; Queensland v The Commonwealth (1977) 139 CLR 585 at 604-605; Kartinyeri v Commonwealth (1998) 195 CLR 337 at 380-381 [87]- [88]; Sue v Hill (1999) 199 CLR 462 at 480 [26]. 55 (1991) 172 CLR 501 at 638. 56 (1991) 172 CLR 501 at 638. 57 New South Wales v The Commonwealth (1975) 135 CLR 337 at 458. Crennan To that his Honour added58: "Indeed, any limitation upon the power of the Commonwealth to legislate with respect to matters outside the country would leave a gap in the totality of legislative power which the Constitution bestows upon the Commonwealth and the States. An interpretation of the Constitution which denies the completeness of Australian legislative power is unacceptable in terms of constitutional theory and practice. Apart from express or implied constitutional prohibitions or limitations, it is not to be contemplated that there are laws which no Parliament has the power to pass". Counsel for the plaintiff challenged this reasoning. They pointed to what was said to be the plentitude of the extraterritorial legislative competence of the States spelt out or confirmed by s 2 of the Australia Act 1986 (Cth) and the decision shortly thereafter in Union Steamship Co of Australia Pty Ltd v King59. Further, s 51(xxxviii) of the Constitution ensured there need be no "gap" between the competence of the Parliament at Canberra and that at Westminster, if there be the request or concurrence of State Parliaments60. The words "within the Commonwealth" in s 51(xxxviii) do not import a territorial limitation upon laws supported by that head of power61. Of these submissions two things may be said. First, they assume at a theoretical level a common legislative purpose among the States. However, practical considerations suggest that a common purpose may sometimes be absent. Secondly, it is appropriate to recall, in dealing with the interrelation 58 (1991) 172 CLR 501 at 638. 59 (1988) 166 CLR 1. 60 Paragraph (xxxviii) reads: "[T]he exercise within the Commonwealth, at the request or with the concurrence of the Parliaments of all the States directly concerned, of any power which can at the establishment of this Constitution be exercised only by the Parliament of the United Kingdom or by the Federal Council of Australasia". 61 Port MacDonnell Professional Fishermen's Assn Inc v South Australia (1989) 168 CLR 340 at 376-378. Crennan between s 51(xxix) and other heads of legislative power, what was said by Latham CJ in Burgess. His Honour remarked62: "It has been argued that s 51(xxix) should be construed as giving power to make laws only with respect to some external aspect of the other subjects mentioned in s 51. Prima facie it would be as reasonable to argue that any other single power conferred by s 51 is limited by reference to all the other powers conferred by that section – which is really an unintelligible proposition. There is no reason whatever why placitum xxix should not be given its natural and proper meaning, whatever that may be, as an independent express legislative power." Words of O'Connor J, uttered in 1908 and often repeated in this Court63, are in point when construing s 51(xxix). In Jumbunna Coal Mine, No Liability v Victorian Coal Miners' Association64, after noting that the broad and general terms of the Constitution were "intended to apply to the varying conditions which the development of our community must involve", O'Connor J continued65: "For that reason, where the question is whether the Constitution has used an expression in the wider or in the narrower sense, the Court should, in my opinion, always lean to the broader interpretation unless there is something in the context or in the rest of the Constitution to indicate that the narrower interpretation will best carry out its object and purpose." Hence that branch of the argument for the Commonwealth in the Seas and Submerged Lands Case66 that the sea and the shelf were external to Australia and therefore proper subjects for legislation under s 51(xxix) because "external" 62 (1936) 55 CLR 608 at 639. See also the judgments of Mason J and Jacobs J in the Seas and Submerged Lands Case (1975) 135 CLR 337 at 471, 497. 63 See, for example, R v Public Vehicles Licensing Appeal Tribunal (Tas); Ex parte Australian National Airways Pty Ltd (1964) 113 CLR 207 at 225-226; Port MacDonnell Professional Fishermen's Assn Inc v South Australia (1989) 168 CLR 340 at 378-379; Street v Queensland Bar Association (1989) 168 CLR 461 at 527, 554. See generally Grain Pool of Western Australia v Commonwealth (2000) 202 CLR 479 at 492 [16]. 64 (1908) 6 CLR 309 at 368. 65 (1908) 6 CLR 309 at 368. 66 (1975) 135 CLR 337 at 342. Crennan means external to the Australian land mass. That submission was accepted and developed by Barwick CJ, Mason J and Jacobs J67. Murphy J68 said that the power was not limited to the making of laws for the implementation of treaties or conventions. In particular, Mason J emphasised that the term "affairs" was not limited to relationships with other countries69. From this basis there developed the statements of principle respecting the construction of s 51(xxix) encapsulated a decade ago in the passage in the Industrial Relations Act Case70 set out earlier in these reasons. The plaintiff criticised this course of development in the construction of s 51(xxix), but it is in line with well-settled principles of constitutional interpretation. Particular submissions by the plaintiff The plaintiff urged that the proposition that it suffices for validity of a law reliant upon s 51(xxix) that it operates on matters, persons or things external to Australia is contrary to the connotation of the phrase "external affairs" as understood in 1900. To that the following statement in the Industrial Relations Act Case71 is in point: "[T]he external relations of the Australian colonies were in a condition of continuing evolution and, at time, were regarded as such. that Accordingly, it is difficult to see any justification for treating the content of the phrase 'external affairs' as crystallised at the commencement of federation, or as denying it a particular application on the ground that the application was not foreseen or could not have been foreseen a century ago." With respect to the position in the United States, Holmes J spoke memorably to like effect in State of Missouri v Holland72. 67 (1975) 135 CLR 337 at 360, 470-471, 497-498. 68 (1975) 135 CLR 337 at 503. 69 (1975) 135 CLR 337 at 470. 70 (1996) 187 CLR 416 at 485. 71 (1996) 187 CLR 416 at 482. 72 252 US 416 at 433 (1920). Crennan The plaintiff further submitted that what is supported by par (xxix) is the implementation of international obligations under treaties and under customary international law. That may readily be accepted, but there is no pregnant negative that the power has no other operation. The point is illustrated by what was said by Dawson J in The Tasmanian Dam Case73: "It is, of course, true that a law can be a law with respect to external affairs although it is not made in the implementation of any international obligation. The subject-matter of the law may of itself be within that category although it is not passed pursuant to any international obligation. Such matters as diplomatic rights and immunities, the treatment of fugitive offenders, the determination of external boundaries or the excitement of disaffection against other countries are affairs which, on their face and without more, are within the legislative power of the Commonwealth". Finally, the plaintiff referred to the territorial reach of other heads of legislative power in s 51 of the Constitution as bearing upon (and confining) the interpretation of s 51(xxix). That matter has been considered earlier in these reasons. The Commonwealth's submissions The Commonwealth correctly submitted that legislation proscribing conduct engaged in outside Australia, such as s 50BA and s 50BC of the Crimes Act, is supported by the external affairs power. That is so without the further requirement, here imposed by s 50AD, that the person alleged to have committed the offence outside Australia must be an Australian citizen or a resident of Australia. However, the Commonwealth also submitted, as an independent ground for validity, that the subject-matter of the provisions in question is a "matter of international concern". Particular reliance was placed upon what had been said on that subject by Stephen J in Koowarta v Bjelke-Petersen74. His Honour remarked75: 73 (1983) 158 CLR 1 at 300-301. 74 (1982) 153 CLR 168. 75 (1982) 153 CLR 168 at 217. Crennan "A subject-matter of international concern necessarily possesses the capacity to affect a country's relations with other nations and this quality is itself enough to make a subject-matter a part of a nation's 'external affairs'." The phrase "matter of international concern" appears to have been introduced in the consideration by Willoughby of the treaty-making provisions of the United States Constitution76. In the first edition of his treatise, published in 1910, Willoughby sought to limit, not expand, the authority of the President in that regard by contrasting the use of the treaty-making power to regulate or control matters properly and fairly "matters of international concern", and its use to regulate or control matters of domestic law ordinarily relating "to the reserved powers of the States or to the private rights of the individuals"77. Thereafter, in 1920, arguments of that nature were rejected in State of Missouri v Holland78. In The Tasmanian Dam Case79, four Justices appear to have indicated that the presence of a subject-matter of international concern sufficed to attract the exercise of the external affairs power even in the absence of a treaty. Dawson J preferred to see the requirement of international concern as a restriction on the power80. The subject was revisited in Polyukhovich81. Some of the unsettled questions concerning the use of the notion of international concern were raised in argument in the present case. However, 76 cf Henkin, Foreign Affairs and the Constitution, (1972) at 152, which gives the primary source as a speech by Charles Evans Hughes in 1929. 77 Willoughby, The Constitutional Law of the United States, (1910), vol 1, §190; cf The Constitution of the United States of America, Analysis and Interpretation, 79 (1983) 158 CLR 1 at 131-132 per Mason J, 171-172 per Murphy J, 222 per Brennan J, 258-259 per Deane J. 80 See Richardson v Forestry Commission (1988) 164 CLR 261 at 322-323. 81 (1991) 172 CLR 501 at 561-562 per Brennan J, 604-605 per Deane J, 657-658 per Crennan given the direct path by which the legislation in question is upheld, these questions may be left for a later occasion on which they arise. Kirby KIRBY J. These proceedings on a case stated for the opinion of the Full Court82 concern the constitutional validity of two sections83 of the Crimes Act 1914 (Cth) ("the Crimes Act"). It is pursuant to those sections that the plaintiff, who is an Australian citizen, has been charged with sexual offences involving "a person who is under 16"84. The offences are alleged to have occurred in the Kingdom of Thailand. On 17 November 2005, having heard the arguments of the parties, this Court answered the questions stated in terms upholding the validity of the sections. I agreed in the answers given by the Court. It remains for me to state my reasons. In his text on constitutional law, Professor P H Lane states that "external affairs" was "once a phrase that had some kind of peculiar connotation with a resulting extent". He complains that now this Court "does not explain 'external affairs' as an identifiable notion"85. Whilst this statement is not entirely accurate, at least in respect of that aspect of "external affairs" upon which the Commonwealth primarily relied for the validity of the legislation contested in this case, the general complaint deserves attention. The issue is of constitutional importance because of the risk, expressed by the plaintiff, that the approach to the constitutional validity of the federal legislation urged by the Commonwealth could cause an unravelling of the balances established in the applicable federal legislative power by reference, in particular, to facts, persons or things existing beyond Australia's geographical borders. Unquestionably, this is a significant issue for the Constitution and for the meaning and limits of the powers of the Federal Parliament. The plaintiff charged that, in the recent elaborations of the "external affairs" power86, this Court had taken a wrong turning. He submitted that the Court should now return 82 Case stated by Hayne J, 2 June 2005. The name of the plaintiff was anonymised, taking into account s 15YR(1) of the Crimes Act 1914 (Cth). See [2005] HCATrans 311. 83 Sections 50BA and 50BC. 84 Crimes Act, ss 50BA(1) and 50BC(1)(a). 85 Lane's Commentary on The Australian Constitution, 2nd ed (1997) at 284. 86 Constitution, s 51(xxix). Kirby to earlier doctrine lest the more recent explanation of the power become entrenched so as to wound the federation87. This case affords an occasion suitable to consider this submission88. In the end, it does not avail the plaintiff, for the constitutional validity of the legislation may be upheld on an alternative elaboration of the power. However, the point needs to be noticed so that it is not lost for a future occasion when it might prove to be determinative. The facts and legislation The facts: The plaintiff is charged with offences against ss 50BA and 50BC of the Crimes Act. He denies his guilt of the alleged offences. However, no submission was put to the effect that, if the offences are constitutionally valid, they do not apply to him, to a "person who is under 16" and to the place outside Australia (namely Thailand) where the "physical elements … of the offence[s]"89 are alleged to have occurred. The details of the charges are set out in the reasons of Gummow, Hayne and Crennan JJ90. It is not necessary for me to repeat them. One point to notice at the outset is that, as the general age of consent in Thailand was said to be fifteen years, there is thus a possibility that, under the impugned provisions, an Australian citizen or permanent resident might be rendered liable in Australia for acts happening in Thailand that would not constitute a criminal offence in that country. The plaintiff complained about this and about other features of the legislation. It will be necessary to return to those complaints91. Whether they ultimately have any relevance to the accusations against the plaintiff is unknown, lying as they do outside the facts appearing in the case stated. International background: The federal legislation challenged in these proceedings has a background. It can best be understood in the context of a number of events occurring both within and outside Australia. 87 Specifically as to the plenary ambit of s 51(xxix) of the Constitution in any law with respect to facts, persons and things beyond the geographical limits of Australia. 88 Cf Dalton v NSW Crime Commission [2006] HCA 17 at [94]-[97]. 89 Crimes Act, s 50BA(2). See also s 50BC(2). 90 Reasons of Gummow, Hayne and Crennan JJ at [21]-[23]. 91 See below these reasons at [146]. Kirby Of critical importance was the adoption by the General Assembly of the United Nations, on 20 November 1989, of the Convention on the Rights of the Child ("the CRC"). Australia ratified that Convention in January 199192. So have most other nation states. Stimulated by the CRC, and by the commitments contained within it93, a number of initiatives were taken within the United Nations Organisation, designed to protect children from various harms and dangers94. Eventually, an Optional Protocol to the CRC was adopted by the General Assembly on 25 May 2000. By Art 4.2(a) of that Protocol it is provided that: "Each State Party may take such measures as may be necessary to establish its jurisdiction over the offences referred to in article 3, paragraph 1 [including '[s]exual exploitation of the child'] … (a) [w]hen the alleged offender is a national of that State or a person who has his habitual residence in its territory". Australia, through the federal Executive Government, took a leading part in drafting, proposing and securing the adoption of this Protocol95. However, the Commonwealth did not rely upon the Protocol as a treaty which the provisions of the Crimes Act in question were designed to implement96. Nevertheless, the Commonwealth submitted that the Protocol indicated that the subject matter of the Crimes Act was one of "international concern" and was relevant to Australia's relationships with other nation states and with international organisations. relevant The plaintiff raised no objection to the tender by the Commonwealth of a great deal of material concerning initiatives within the international community, and in Australia97, concerning the protection of children from sexual acts by 92 [1991] Australian Treaty Series 4. 93 CRC, esp Arts 19, 34. 94 A World Summit for Children was held in September 1990, concluding with the World Declaration on the Survival, Protection and Development of Children. 95 See speech by the Hon D Kerr MP, Minister for Justice, at the opening of the World Congress on Family Law and Children's Rights, Sydney, 4 July 1993 at 4. 96 The Protocol was not in force when the Crimes Act was amended in 1994 by the Crimes (Child Sex Tourism) Amendment Act 1994 (Cth). That amendment inserted in the Crimes Act the offences with which the plaintiff is charged. 97 Such as the convening of the First World Congress on Family Law and Children's Rights, Sydney, 4 July 1993. Kirby foreign nationals98. Such material provides further background against which the impugned provisions of the Crimes Act may be understood. The issues As I approach these proceedings, there are five issues: The geographical externality issue: Is a federal law that operates extraterritorially with respect to facts, persons or things geographically external to Australia, for that reason alone, necessarily a law with respect to "external affairs" within the meaning of s 51(xxix) of the Constitution? Does the present authority of this Court uphold that proposition? If so, should this Court simply apply that authority and, without more, answer the question stated adversely to the plaintiff, notwithstanding the criticisms of that authority advanced by the plaintiff? The leave to reopen issue: Contingently on a determination of the first issue adverse to his arguments, the plaintiff sought leave, if necessary, to reopen such authority of the Court as upheld the geographical externality principle for the content of the "external affairs" power in the Constitution. Is leave necessary to permit any such reopening of a past ruling concerning the meaning of a provision of the Constitution? If so, should such leave be granted? The reversal of authority issue: If leave to reargue the correctness of the geographical externality principle for the meaning of s 51(xxix) of the Constitution is granted or is not required, should the principle be reconsidered by the Court in the light of earlier authority, the language, structure and purpose of s 51(xxix) and other relevant considerations? Should that principle be overruled or re-expressed having regard to the plaintiff's arguments? The alternative validity issue: If the geographical externality principle should be overruled or re-expressed, or if that question should be reserved for a decision in a case where it is essential to the result, is the law impugned by the plaintiff in these proceedings nonetheless valid under the Constitution because: it is adequately demonstrated that the law in issue is with respect to a matter of "international concern" affecting Australia and thus, without more, concerns a subject within s 51(xxix) of the Constitution; or 98 [2005] HCATrans 957 at 2660. See also at 2999. Kirby it is sufficiently connected with the legislative powers of the Federal Parliament with respect to crimes of the nominated type committed overseas by an Australian national or permanent resident on the basis that such crimes affect, or may affect, the external relations of Australia with other nation states or international organisations? The proportionality issue: Assuming that one of the suggested criteria for establishing the validity of the law impugned by the plaintiff is arguable, is the law nonetheless invalid because, upon analysis, it is disproportionate (not "reasonably appropriate and adapted") to the power of the Federal Parliament to enact such a law in the terms of the contested provisions of the Crimes Act? The geographical externality principle The geographical externality criteria: The reasons of Gummow, Hayne and Crennan JJ explain the geographical externality principle, as it has been elaborated to describe the ambit of the powers of the Federal Parliament to make the laws with respect Constitution99. to "external affairs", pursuant to s 51(xxix) of Those reasons state that the principle, in the terms in which it was expressed in Victoria v The Commonwealth (Industrial Relations Act Case)100, is "[t]he modern doctrine". This is the very complaint that the plaintiff makes against the principle, in so far as it claims to express part of Australian constitutional law. He argues that it represents a departure from a carefully formed past doctrine based on a more faithful application of the constitutional text. He submits that it involves the acceptance of an unsettling new approach which was not adequately considered when adopted101 and has not been sufficiently analysed in the cases in which it has subsequently been applied102. 99 Reasons of Gummow, Hayne and Crennan JJ at [30]-[45]. 100 (1996) 187 CLR 416 at 485. See reasons of Gummow, Hayne and Crennan JJ at 101 Polyukhovich v The Commonwealth (War Crimes Act Case) (1991) 172 CLR 501 at 528-531 per Mason CJ, 599-603 per Deane J, 632 per Dawson J, 695-696 per Gaudron J, 712-714 per McHugh J. 102 Horta v The Commonwealth (1994) 181 CLR 183 at 193-194; Industrial Relations Act Case (1996) 187 CLR 416 at 485 per Brennan CJ, Toohey, Gaudron, McHugh and Gummow JJ; De L v Director-General, NSW Department of Community Services (1996) 187 CLR 640 at 650 per Brennan CJ, Dawson, Toohey, Gaudron, (Footnote continues on next page) Kirby In obiter remarks, I have earlier accepted the geographical externality principle in cases where it was not criticised or questioned in argument103. So, it seems, have other present members of this Court. The plaintiff argued that this was the error that should now be corrected104. The plaintiff said that the holding in Polyukhovich v The Commonwealth (War Crimes Act Case)105, where, for the first time, a majority of this Court endorsed the geographical externality principle, had been accepted uncritically in subsequent cases. Now, so it was suggested, was the time to pause and reconsider the "modern doctrine" with the benefit of critical analysis, which the Court needed in order to sharpen its federal jurisprudence106 and to correct a dangerous wrong turning. Various arguments can be mounted to sustain alternative rationales supporting the actual orders of this Court in Polyukhovich, quite apart from the geographical externality principle. Thus, I agree with the reasons of Gummow, Hayne and Crennan JJ that the outcomes in Polyukhovich, and in later cases, can be supported "upon a qualified view of the scope of the external affairs power"107. In some of the cases since Polyukhovich, the constitutional validity of the federal law was not contested108. In one case the impugned principle was not McHugh and Gummow JJ; cf at 680-682 of my own reasons; R v Hughes (2000) 202 CLR 535 at 556 [42] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne 103 De L (1996) 187 CLR 640 at 668 fn 79; Re Aird; Ex parte Alpert (2004) 220 CLR 308 at 334 [82] fn 103. 104 Apart from Horta, the Industrial Relations Act Case, Hughes and De L, see, eg, Shaw v Minister for Immigration and Multicultural Affairs (2003) 218 CLR 28 at 85 [182] per Callinan J. Specific mention is made in Aird (2004) 220 CLR 308 at 313 [7] of the subject provisions of the Crimes Act. 105 (1991) 172 CLR 501 at 528, 549, 599, 632, 696 and 712. 106 Selway and Williams, "The High Court and Australian Federalism", (2005) Publius 107 Reasons of Gummow, Hayne and Crennan JJ at [34]; cf reasons of Callinan and 108 De L (1996) 187 CLR 640 at 668; cf Hughes (2000) 202 CLR 535 at 583 [118]. Kirby critical to the point ultimately decided109. In other cases the law in question substantially relied on a treaty, implementation of which is an undisputed basis for a valid federal law relying on s 51(xxix) of the Constitution110. In other instances there were, as the reasons of Gummow, Hayne and Crennan JJ state, "obvious" and "substantial" connections between Australia and the contested subject matter111. Thus, in Polyukhovich there was at least one matter of "international concern", being the response of nation states to established instances of crimes of universal jurisdiction, provision for which is arguably also a matter affecting Australia's relations with other states and international organisations and thus a law with respect to "external affairs" upon those grounds112. Nevertheless, all this being said, the ratio decidendi to be derived from Polyukhovich depends not on what a majority of this Court might have reasoned in arriving at their conclusions but upon the way in which the majority in fact reasoned. Moreover, the binding rule is to be derived from the legal principles accepted by those members of the Court who, for common reasons, agreed in the Court's orders113. The principle in Polyukhovich did not emerge out of thin air. It had a number of heralds in the earlier dicta of individual Justices of this Court. These included Jacobs J in New South Wales v The Commonwealth ("the Seas and Submerged Lands Act Case")114; Barwick CJ in Robinson v Western Australian Museum115; Murphy J in Viro v The Queen116; Mason J in Koowarta v 109 Aird (2004) 220 CLR 308. The decisive point argued concerned the compatibility of the legislation with the requirements of Ch III of the Constitution. 110 Industrial Relations Act Case (1996) 187 CLR 416. 111 Reasons of Gummow, Hayne and Crennan JJ at [34]. 112 Polyukhovich (1991) 172 CLR 501 at 684 per Toohey J. 113 Garcia v National Australia Bank Ltd (1998) 194 CLR 395 at 417-418 [56]. See MacAdam and Pyke, Judicial Reasoning and The Doctrine of Precedent in Australia, (1998), Ch 10. 114 (1975) 135 CLR 337 at 497. See also at 360 per Barwick CJ, 470-471 per Mason J, 503 per Murphy J. 115 (1977) 138 CLR 283 at 294. See also at 335 per Mason J. 116 (1978) 141 CLR 88 at 162. See also Pearce v Florenca (1976) 135 CLR 507 at Kirby Bjelke-Petersen117; and Deane J in The Commonwealth v Tasmania (The Tasmanian Dam Case)118. Still, the turning point occurred in Polyukhovich when the geographical externality principle gathered support from a majority of the Justices. That majority included Dawson J119 who, before Polyukhovich, had repeatedly expressed the strongest reservation over an expansive interpretation of the "external affairs" power of the Constitution, lest the power, so expanded, be used to disturb the internal federal balances between the Commonwealth and the States beyond that which was clearly required by Australia's participation in the international community and by its relations with other nation states and international organisations. The consideration that Dawson J in Polyukhovich treated as critical to tipping the balance in favour of acceptance of the geographical externality principle was his view that "[t]he word 'external' is precise and is unqualified"120. Facts, persons and things lying outside the geographical limits of this country fell within the description "external to it" and thus within the language of s 51(xxix) of the Constitution. It was this reasoning that the plaintiff sought to challenge in these proceedings. In my view, this Court should not brush the challenge aside. We should address it, so far as it is necessary to do so in order to reach an outcome. A binding rule? From the foregoing it follows that if the "modern doctrine", as propounded by a majority in Polyukhovich, correctly expresses the ambit of s 51(xxix) of the Constitution, the conduct proscribed by ss 50BA and 50BC of the Crimes Act, being with respect to facts, persons or things outside the geographical limits of Australia, falls within the meaning of the phrase "external affairs". This supplies a sufficient "constitutional fact" to sustain the validity of those sections121. That conclusion, without more, unless its underlying principle is overruled or re-expressed more narrowly, therefore supports the orders announced by this Court. It sustains the constitutional validity of the charges brought against the plaintiff. 117 (1982) 153 CLR 168 at 223. See also at 211 per Stephen J. 118 (1983) 158 CLR 1 at 255-256; cf at 171-172 per Murphy J. 119 (1991) 172 CLR 501 at 632. 120 (1991) 172 CLR 501 at 632, cited in the reasons of Gummow, Hayne and 121 Reasons of Gummow, Hayne and Crennan JJ at [31]. Kirby The plaintiff did not really contest any of the foregoing. Nor did he suggest that it was possible, in the language of the impugned provisions, to read them down or to re-express them in some way, so as to affect their validity on this hypothesis. For its part, the Commonwealth did not argue for a source of constitutional validity other than s 51(xxix) of the Constitution. Nor, as I have said, was any treaty nominated, the implementation of which would sustain the validity of the contested provisions under that paragraph. This being the case, it is necessary to consider immediately whether the plaintiff requires, and if so whether he should have, leave to reopen the geographical externality principle as a rule of Australian constitutional law. Constitutional reargument requires no leave The supposed requirement of leave: As this Court unanimously said in Lange v Australian Broadcasting Corporation122, it is not bound by its previous decisions123. Nor has it laid down any particular rule or rules or set of factors for reopening the correctness of earlier authority124. Obviously, the Court approaches with caution any suggested reconsideration of a legal principle, including one affecting an understanding of the meaning of the Constitution, which has been decided by a majority of the Justices. Nevertheless, there is no doubt that the Court will re-examine such a principle if it involves a question of "vital constitutional importance"125 and it considers it to be "manifestly wrong"126. As all members of the Court said in Lange127: 122 (1997) 189 CLR 520 at 554. 123 Damjanovic & Sons Pty Ltd v The Commonwealth (1968) 117 CLR 390 at 396; Queensland v The Commonwealth (1977) 139 CLR 585 at 610; Baker v Campbell (1983) 153 CLR 52 at 102. 124 Cf reasons of Callinan and Heydon JJ at [204]-[205]. 125 Queensland v The Commonwealth (1977) 139 CLR 585 at 630. See also The Commonwealth v Cigamatic Pty Ltd (In Liquidation) (1962) 108 CLR 372 at 377. 126 Australian Agricultural Co v Federated Engine-Drivers and Firemen's Association of Australasia (1913) 17 CLR 261 at 278-279; The Tramways Case [No 1] (1914) 18 CLR 54 at 58, 69, 83. 127 (1997) 189 CLR 520 at 554. Kirby "Errors in constitutional interpretation are not remediable by the legislature128, and the Court's approach to constitutional matters is not necessarily the same as in matters concerning the common law or statutes." Various considerations of principle and convenience argue against the reopening of the constitutional rules expressed in Polyukhovich. I will assume that the cases since that decision that have applied the geographical externality principle add nothing of importance to the content of that rule. The rule emerged, as I have shown, from observations and reasoning of individual Justices expressed over more than a decade. Brennan CJ and Toohey J, who expressed a different view in Polyukhovich, nonetheless appear (to the extent necessary) to have endorsed its reasoning without relevant qualification in the Industrial Relations Act Case129. In consequence, at least to some extent, the principle has been used to sustain particular provisions of federal legislation, the validity of which might be cast in doubt by adoption of a more qualified view of the scope of the external affairs power130. Yet are these simply the customary reasons for the exercise of care in giving effect to an opinion about constitutional meaning that is different from that adopted by an earlier majority in this Court? Or is there a procedural barrier of leave that must be overcome, in order to secure consideration by this Court of any submissions critical of past authority about the meaning of the Constitution? No leave is required: In my view, leave is not required by a party in order to advance arguments contesting a previous determination by the Court as to the meaning of the Constitution. My reasons for that opinion are identical to those stated by Deane J in Evda Nominees Pty Ltd v Victoria131. As my own reasons 128 Queensland v The Commonwealth (1977) 139 CLR 585 at 630; Street v Queensland Bar Association (1989) 168 CLR 461 at 588. 129 (1996) 187 CLR 416 at 485. See also Horta (1994) 181 CLR 183; Hughes (2000) 202 CLR 535 at 556 [42]. 130 Amongst other legislation, the Commonwealth referred to Historic Shipwrecks Act 1976 (Cth); Foreign Proceedings (Excess of Jurisdiction) Act 1984 (Cth), ss 5(a)(v) and 7; Weapons of Mass Destruction (Prevention of Proliferation) Act 1995 (Cth), s 6(3)(b); Space Activities Act 1998 (Cth), s 108(2)(b); Environment Protection and Biodiversity Conservation Act 1999 (Cth), ss 5(2) and 5(5); Crimes at Sea Act 2000 (Cth); Transport Safety Investigation Act 2003 (Cth), s 6. Some at least of these provisions might be sustained by treaty obligations or by other explanations of the power afforded by the Constitution, s 51(xxix). It is unnecessary to decide such questions. 131 (1984) 154 CLR 311 at 316. Kirby have been stated in several cases132, including recently133, I will not repeat them now. In the present case, the plaintiff was allowed to present his full arguments. His counsel did so134. I therefore agree with the reasons of Gummow, Hayne and Crennan JJ that it is unnecessary in this case to embark on a detailed examination of the meaning and application of the majority opinion in Evda135. That question should be left to a case, if any exists, where it must be determined. This is not such a case. I therefore proceed directly to the geographical externality principle. It was the the primary basis upon which constitutional validity of the provisions of the Crimes Act challenged by the plaintiff. I accept that a number of arguments can be advanced in favour of the approach expressed in that principle. Many of them are collected, or referred to, in the reasons of Gummow, Hayne and Crennan JJ. the Commonwealth supported Support for the geographical externality principle The textual foundation: If the anchor for constitutional interpretation is the text136, certain textual indications lend support to the "modern doctrine". Section 51(xxix) does not, in its terms, confine itself to "Australia's external affairs". Nor does it expressly limit itself to subjects having some special, and defined, connection with Australia137. The word "affairs" has a "wide and indefinite meaning". This is what has led advocates of the current approach to conclude that s 51(xxix)138: 132 Eg Brownlee v The Queen (2001) 207 CLR 278 at 312-315 [100]-[108]; British American Tobacco Australia Ltd v Western Australia (2003) 217 CLR 30 at 80 133 Permanent Trustee Australia Ltd v Commissioner of State Revenue (Vict) (2004) 220 CLR 388 at 451-453 [176]-[180]. 134 [2005] HCATrans 957 at 1194. 135 Reasons of Gummow, Hayne and Crennan JJ at [38]. 136 Tucker, "Textualism: An Australian Evaluation of the Debate between Professor Ronald Dworkin and Justice Antonin Scalia", (1999) 21 Sydney Law Review 567. 137 Polyukhovich (1991) 172 CLR 501 at 599 per Deane J. 138 Polyukhovich (1991) 172 CLR 501 at 599. Kirby "encompass[es] both relationships and things: relationships with or between foreign States and foreign or international organizations or other entities; matters and things which are territorially external to Australia regardless of whether they have some identified connexion with Australia or whether they be the subject matter of international treaties, dealings, rights or obligations". The broad constitutional grant: The general principle commanding a broad construction of the constitutional text lends additional support to the is some countervailing geographical externality principle unless consideration that has the effect of cutting down the grant139. Certainly, the principle as it presently stands involves a very wide view of the constitutional grant of power, encompassing as it does the power to make laws without limitation with respect to facts, persons or things anywhere in the world external to Australia. there Early federal history: As a matter of history, even before federation, the Australian colonies were beginning to take an active part, within the British Empire, in matters of external concern, as for example by involvement in the Universal Postal Union, formed in 1874140. Once the Commonwealth was established, the Imperial authorities insisted that the international face of the new federal polity which would be recognised by the Crown was the Commonwealth, and not the States. This position was illustrated in the Vondel Case that arose in April 1902 concerned with the conduct of South Australian officials dealing with seamen who had deserted from a Dutch ship. The responsible British Minister, Joseph Chamberlain, rebuffed the attempt of the Lieutenant-Governor of South Australia (Sir Samuel Way) to contest the insistence of the British authorities that the State should deal through the Federal Government and its officials141: 139 Jumbunna Coal Mine, No Liability v Victorian Coal Miners' Association (1908) 6 CLR 309 at 368 per O'Connor J. See reasons of Gummow, Hayne and Crennan JJ at [39]; cf reasons of Callinan and Heydon JJ at [180]. 140 Zines, "The Growth of Australian Nationhood and its Effect on the Powers of the Commonwealth", in Zines (ed), Commentaries on the Australian Constitution, (1977) 1 at 7. See also Harrison Moore, "The Commonwealth of Australia Bill", (1900) 16 Law Quarterly Review 35 at 39. The latter described the power with respect to "external affairs" as a "dark one". He suggested that it was designed to overcome the question, still then vexing Canada, as to whether the Federal Parliament had the power to enact laws with extraterritorial operation. 141 Australia, Correspondence respecting the Australian Commonwealth and States in regard to External Affairs, (1903) (Footnote continues on next page) the Constitutional Relations of Kirby "So far as other communities in the Empire or foreign nations are concerned the people of Australia form one political community for which the Government of the Commonwealth alone can speak, and for everything affecting external states or communities, which takes place within its boundaries, that Government is responsible. The distribution of powers between the Federal and State Authorities is a matter of purely internal concern of which no external country or community can take any cognizance. It is to the Commonwealth and the Commonwealth alone that, through the Imperial Government, they must look, for remedy or relief for any action affecting them". Whilst not specific to the geographical externality principle, the stated approach shows how, from the very beginning of the Commonwealth, federal officials and federal law were expected, within the Empire, to bear the sole responsibility for Australia's relationships ("affairs") with nations, organisations and entities external to Australia. The external discrimen: Given the necessity to draw lines in respect of the respective lawmaking and other responsibilities of the federal, State and Territory polities, the relevant line that s 51(xxix) of the Constitution provides, suggested by the reference to "affairs" that are "external", is one that begins at the outer limit of the Australian land mass. This, at least, affords an objective discrimen. It refers to the entirety of the rest of the world and, indeed, so far as relevant, any "affairs" that lie beyond that142. "Affairs" and "relations": By reference to the juxtaposition of language in s 51(xxx) (with its mention of "the relations of the Commonwealth with the islands of the Pacific"143), the suggestion can be made that if it was intended that "external affairs" refer, and refer only, to "relations" of the Commonwealth with other states, that is what would have been said. Instead, the paragraph is more open-textured. It refers to several areas of legal operation including (but not limited to) the implementation of treaties entered with other nation states, organisations or entities144. [Cd 1587] at 26. See also Zines, "The Growth of Australian Nationhood and its Effect on the Powers of the Commonwealth", in Zines (ed), Commentaries on the Australian Constitution, (1977) 1 at 17-18. 142 As for example dealt with in the Space Activities Act 1998 (Cth). 143 Ruhani v Director of Police (2005) 79 ALJR 1431 at 1467 [201]-[202]; 219 ALR 144 Seas and Submerged Lands Act Case (1975) 135 CLR 337 at 503 per Murphy J. Kirby Once it is accepted that the Constitution is not to be confined to meanings that were held, or to applications that were expected, at the time of its adoption in 1900145, a functional analysis of its terms lends support to the geographical externality principle. Responding to external concerns: Clearly, the ambit of international treaties has expanded enormously in recent decades, thereby unquestionably enlarging the denotation of s 51(xxix)146. It would be a constitutional misfortune if the Australian Constitution were unable effectively to respond to these changes147. If the legislative power conferred by s 51(xxix) were "inapt to embrace the wide responsibilities and obligations now falling upon the Commonwealth ... [which] needs a more ample grant of legislative power to enable it to conduct a foreign policy that is adequate to ensure its security, and to play its proper part as a member of the … institutions which contribute at the present time towards the maintenance of international order [and] the welfare of human beings on a world-wide scale"148, the result would be a serious inconvenience. While such an inconvenience is not determinative, and some inconvenience is inherent in a constitutional instrument expressing limited powers, where the language of the grant suggests a broader view, that view will generally be preferred having regard to the character of the document in which the grant is made149. The geographical externality principle largely solves these suggested problems. It avoids the "irksome"150 necessity to seek a formal amendment of the constitutional text. It allows the Constitution, read with today's eyes, to respond to the necessities of the present age. To the extent that the text permits it, 145 Sue v Hill (1999) 199 CLR 462 referred to in the reasons of Gleeson CJ at [13]; cf reasons of Callinan and Heydon JJ at [153]-[155]. See also Re Wakim; Ex parte McNally (1999) 198 CLR 511 at 552-553 [44] and Grain Pool of Western Australia v The Commonwealth (2000) 202 CLR 479 at 522-523 [111]. 146 Al-Kateb v Godwin (2004) 219 CLR 562 at 590 [65] (referring to the fact that Australia is a party to about 900 treaties). 147 Industrial Relations Act Case (1996) 187 CLR 416 at 482. See reasons of 148 Starke, "The Commonwealth in International Affairs", in Else-Mitchell (ed), Essays on the Australian Constitution, 2nd ed (1961) 343 at 374. 149 Cf reasons of Callinan and Heydon JJ at [201]-[203]. 150 Industrial Relations Act Case (1996) 187 CLR 416 at 565 per Dawson J. Kirby Australia, as a nation, should be capable of enacting laws, as other nations can do, with respect to "a place, person, matter or thing [that] lies outside the geographical limits of the country"151. Safeguards for the federation: Whatever problems and fearsome possibilities may be conceived, including in the form of a Trojan horse dressed in the colours of "external affairs" that could invade the usual subjects of State powers under the Constitution (the anxiety that most troubled Dawson J152), that concern is irrelevant in the case of federal laws addressed to subject matters arising in or affecting facts, persons or things geographically external to Australia153. In such a case the dangers of constitutional nightmares are thereby avoided, or at least significantly lessened154. This is so because, substantially, States are only concerned with lawmaking for their own geographical territory and not beyond. No constitutional "cripple": There are strong reasons of principle for interpreting the Constitution so as to avoid the risk that the Federal Parliament, in terms of its capacity to make laws apt to the contemporary world, would be an international "cripple", with a gap in its lawmaking powers where that gap is not compelled by the constitutional text155. To the plaintiff's suggestion that any "gap" of this kind could be filled, conformably with the Constitution, by invoking s 51(xxxviii)156, the cumbersome procedures and practical difficulties in adopting that course and limited instances where that paragraph has been used. That head of constitutional power hardly responds, in an effective way, to the current the Commonwealth responded with a reminder of 151 Polyukhovich (1991) 172 CLR 501 at 632 per Dawson J. 152 Polyukhovich (1991) 172 CLR 501 at 632. 153 Polyukhovich (1991) 172 CLR 501 at 632 per Dawson J. See also The Tasmanian Dam Case (1983) 158 CLR 1 at 300-301. 154 See, eg, Western Australia v The Commonwealth ("the Territorial Senators Case") (1975) 134 CLR 201 at 271. The plaintiff contested this argument on the basis that the geographical externality principle afforded a foundation for federal laws burdening Australians within Australia, simply by reference to a fact, person or thing beyond Australia in some way said to be relevant to the terms of the law. 155 Seas and Submerged Lands Act Case (1975) 135 CLR 337 at 498 per Jacobs J, 503 per Murphy J. See also Polyukhovich (1991) 172 CLR 501 at 529-530. Contra reasons of Callinan and Heydon JJ at [184]-[188]. 156 Reasons of Gummow, Hayne and Crennan JJ at [41]-[42]. Kirby necessities of national and international governance157. The Commonwealth invoked the gradual expansion of the recognised powers of legislative extraterritoriality that had accompanied the emergence of Australia as an independent nation and the consequential decline of Imperial inhibitions that had been held applicable in the first decades after federation158. The geographical externality principle was thus, at once, a response to the changing international context in which the Constitution must now operate and a consequence of the necessity for the Commonwealth to be in a position to respond effectively to that context. So went the main arguments of the Commonwealth. Resulting difficulties: Despite the powerful arguments of legal authority and also of legal principle and policy supporting the geographical externality principle, the plaintiff made a number of telling criticisms of that approach. It is necessary to take those criticisms into account in deciding whether the principle, now challenged, should be overruled or re-expressed. Problems of the geographical externality principle The original expectations: So far as it is relevant, it seems tolerably clear that, in its purest form, the geographical externality principle was not an approach to s 51(xxix) of the Constitution that would have been accepted by the framers of the Constitution or accepted within the setting of the British Empire in the early decades of federation159. The reasons of Callinan and Heydon JJ demonstrate why this is so160. Historically, the very reason for adopting in s 51(xxix) the expression "external affairs", as distinct from "foreign affairs", was to address the comparatively limited grant of legislative power which, in 1900, was thought apt to the Federal Parliament of Australia. Most of the "affairs" relevant to dealings between members of the British Empire were then still the responsibility of the Imperial Government at Westminster. So far as legislating with respect to 157 Cf R v Foster; Ex parte Eastern and Australian Steamship Co Ltd (1959) 103 CLR 256 at 306-307 per Windeyer J; reasons of Callinan and Heydon JJ at [187]. 158 "The Report of the Conference on the Operation of Dominion Legislation and Merchant Shipping Legislation, 1929", in Keith (ed), Speeches and Documents on the British Dominions: 1918-1931, (1932) 173 at 182; cf Hanks, Constitutional Law in Australia, 2nd ed (1996) at 225; Croft v Dunphy [1933] AC 156 at 163. 159 See, eg, Quick and Garran, The Annotated Constitution of the Australian Commonwealth, (1901) at 631-632. 160 Reasons of Callinan and Heydon JJ at [157]-[173]. Kirby external relations was concerned, in the early days of federation that remained in large part the continuing responsibility and concern of the Imperial authorities. "Affairs" and "relations": Allowing that the Constitution must be construed according to what it means now, not what it meant in 1900, the starting point for the plaintiff was suggested by the text. The word "external" in s 51(xxix) was designed to connote relationships and things connected with other nations and with international organisations, both within and outside the British Empire. But for the legal opinion that parts of the British Empire were not "foreign" to each other161, the words in s 51(xxix) would probably have read "foreign affairs". That, then, was the real subject matter with which (absent the Imperial gloss) the power was intended to deal. Yet once that ambit is understood, it is clear that, in its ordinary Australian meaning, "external affairs" connotes "international relations; activities of a nation arising from its dealings with other nations"162. The plaintiff urged this Court to return to that meaning, which, he argued, was implicit in the composite idea of "external affairs". Even allowing for a contextual and non-originalist approach to the meaning of s 51(xxix) of the Constitution, the plaintiff submitted that the terms of the paragraph were confined to relationships with foreign nations, a concept that should be restored. Uniform earlier authority: The plaintiff argued that the adoption of the "modern doctrine" of s 51(xxix) had involved a radical shift from the earlier decisions of this Court concerning the meaning of that paragraph. In R v Burgess; Ex parte Henry163, counsel explicitly advanced an earlier version of the geographical externality principle. However, it was not accepted by the Court. It is clear enough from the reasons of all members of the Court in Ex parte Henry that they derived much significance for the meaning of the phrase from the word "affairs", used in conjunction with "external". Their Honours' approach was not ostensibly confined to construing the power strictly in accordance with what it had been taken to include in 1900. On the contrary, some of their reasons in that case explicitly traced the gradual emergence of Australia's international personality164. 161 See now Sue v Hill (1999) 199 CLR 462. 162 See Macquarie Dictionary, 4th ed (2005) definition of "foreign affairs" (at 553). By cross-reference, the same definition is provided for "external affairs" (at 499). 163 (1936) 55 CLR 608 at 614; cf at 640. 164 See, eg, (1936) 55 CLR 608 at 640-642 per Latham CJ. Kirby Nevertheless, the proposition that s 51(xxix) should be construed as giving power to make laws with respect to matters external to Australia, as such, was not adopted. Latham CJ said that "the substantial subject matter of external affairs" was "[t]he regulation of relations between Australia and other countries, including other countries within the Empire"165. The Chief Justice considered the phrase as equivalent to a power to make laws with respect to "foreign affairs or relations"166. A like connotation, equating "affairs" to "the more common expression" of "foreign relations of a State", was accepted by Starke J167. In his reasons, Dixon J expressed the "evident … purpose" of the paragraph as being168: "to authorize the Parliament to make laws governing the conduct of Australians in and perhaps out of the Commonwealth in reference to matters affecting the external relations of the Commonwealth". Similarly, Evatt and McTiernan JJ, whilst acknowledging that the expression "external affairs" was one "of wide import", said169: "It is frequently used to denote the whole series of relationships which may exist between States in times of peace or war. It may also include measures designed to promote friendly relations with all or any of the nations." There is nothing in any of the reasons in Ex parte Henry to lend support to the geographical externality principle. On the contrary, all the reasons appear to accept that "external affairs" is concerned with external relations or relationships of Australia with other nation states. This is the essential meaning that the plaintiff asked this Court to restore. Meaning of composite expressions: As a textual matter, there is a difficulty in some of the more recent reasoning of members of this Court, so far as they have attempted to explain the expression in s 51(xxix) by splitting up the words and giving separate meaning to "external" and to "affairs" as, arguably, Deane J did in Polyukhovich170. We now appreciate that this is an inaccurate way 165 (1936) 55 CLR 608 at 643 (emphasis added). 166 (1936) 55 CLR 608 at 643 (emphasis added). See also at 640. 167 (1936) 55 CLR 608 at 658 (emphasis added). 168 (1936) 55 CLR 608 at 669 (emphasis added). 169 (1936) 55 CLR 608 at 684 (emphasis added). 170 (1991) 172 CLR 501 at 599. Kirby of construing composite expressions171. Each part of such an expression throws light on the meaning of the rest. Each must be taken into account. The Constitution did not here use the word "foreign" or "external" in association with "matters"172 or "people"173 or "disputes"174. Still less did the Constitution confer on the Federal Parliament, as the British North America Act of 1867 had done in Canada175, a legislative power to make laws with respect to the general subject of crime which, with expanding notions of extraterritorial operation of laws, could apply to facts, persons and things occurring in the territory of foreign countries. It was the context of the phrase considered as a whole, and especially the use of the word "affairs", that led Gibbs CJ in Koowarta176 to favour confining the application of the power in s 51(xxix) of the Constitution to "public business, transactions or matters concerning men or nations collectively"177. The plaintiff therefore urged that this meaning of the phrase "external affairs" was grounded in more than half a century of this Court's authority. It was more consonant with the evident purpose of the power and its history as appearing in a written Constitution conferring specific and limited powers upon the new Federal Parliament that it created. The plaintiff called for this Court to reverse its departure from the earlier doctrine that had followed the embrace by a minority of the new argument of the Commonwealth in the Seas and Submerged Lands Act Case178. 171 R v Brown [1996] AC 543 at 561 per Lord Hoffmann; Collector of Customs v Agfa- Gevaert Ltd (1996) 186 CLR 389 at 396-397. This legal analysis is sustained by modern research into universal elements in human languages and their structure; the modes of acquisition of language by children; and the essentiality of context to give meaning to individual words: Diamond, The Rise and Fall of The Third Chimpanzee, (1991) at 125-151. See also reasons of Gleeson CJ at [19] and reasons of Callinan and Heydon JJ at [176]. 172 As it does in ss 51(xxxvi), (xxxvii), (xxxix) and 52(ii), (iii). 173 As it does in s 51(xxvi). 174 As it does in s 51(xxxv). 175 Now in the Constitution Act 1867 (Can), s 91(27). 176 (1982) 153 CLR 168. 177 (1982) 153 CLR 168 at 188. 178 (1975) 135 CLR 337 at 342. Contrast the arguments advanced at 347. Kirby Reconciliation with treaty strictness: Whilst the plaintiff accepted, and authority supported, the notion that s 51(xxix) extended beyond the making of treaties and laws to give those treaties effect within Australia, he submitted that a comparatively unbridled power, suggested by the geographical externality principle, was incompatible with a unified notion of the meaning of the paragraph in the Constitution. He argued that it risked unravelling the careful limitations which the Court's previous expositions of s 51(xxix) had established. Thus, if all that were required to sustain a federal law as valid was some application or relevance to a place, person or thing existing beyond the geographical boundaries of Australia (and especially if, as some dicta proposed, the opinion of the Parliament was to be treated as conclusive as to that connection179) the previous insistence of Australian constitutional law upon close conformity between the provisions of a treaty and the federal laws enacted to give such treaty effect180 would be effectively put at nought. Why bother implementing a treaty, the plaintiff asked rhetorically, if the strictures of compliance with the treaty were unnecessary and all that was required to uphold the validity of a federal law was that it could be characterised as one "with respect to" a fact, person or thing geographically external to Australia? The plaintiff argued that there was an unresolved tension between the geographical externality principle and the principle upholding the constitutional validity of laws based on treaties. The tension could only be resolved by a return to the expositions of s 51(xxix) appearing in Ex parte Henry which, the plaintiff insisted, were already ample enough to permit lawmaking by the Federal Parliament as required for Australia's full participation in relationships with other nations where grounded in an obligation of legal derivation, not a nebulous concern. Endangering past authority: In elaboration of this last submission, the plaintiff argued that, if the geographical externality principle were correct, it would open the constitutional doors to federal lawmaking with respect to an enormous range of subjects. It would suggest that earlier important decisions of this Court had been wrongly decided. Thus, if it could be argued that the Communist Party Dissolution Act 1950 (Cth), held not to be a law with respect to "defence"181, was nonetheless a law 179 See, eg, Polyukhovich (1991) 172 CLR 501 at 653-654 per Toohey J. 180 See, eg, Industrial Relations Act Case (1996) 187 CLR 416 at 489. 181 Constitution, s 51(vi). Kirby with respect to "external affairs"182 because of the world-wide character of the communist threat found by the Federal Parliament to exist beyond Australia and because of the service outside Australia of an Army battalion then operating under the United Nations flag in Korea, the decision in the Communist Party Case183 could have been different. That decision denied the power of the Federal Parliament, by statutory preamble, to find conclusively the existence of the requisite constitutional power184. remain questions of characterisation of the law as one "with respect to" facts, persons or things large ambit geographically external encompassed by the "modern doctrine" is beyond question. Particularly is this so because of the accumulation of matters beyond Australia's borders that are now relevant to the claims of federal lawmakers to make laws having effect within those borders. There would to Australia. However, the very Dangers to federalism: The plaintiff also pointed out that it is not accurate to suggest, simply because a place, person or thing is geographically outside the mainland territory of Australia, that it necessarily falls beyond State lawmaking powers, so that any federal laws enacted on the basis of the "modern doctrine" could cause no effective disturbance to the federal-State balance. the geographical externality principle, States now enjoy substantial powers to enact laws having extraterritorial operation185. Quite apart from this consideration, as the present case its most ample demonstrates, application, would certainly authorise federal laws that cut across the enactment of State laws otherwise having operation within the State's own territory. An example may be seen in ss 50DA and 50DB of the Crimes Act providing "[o]ffences of benefiting from, or encouraging, offences against this Part". Those sections, which appear to be directed to travel organisations and like bodies engaged in advertising or promoting child sex tourism, might ordinarily be the subject of State laws, expressing State offences for conduct that would often occur wholly, or substantially, within the borders of the State concerned. The notion which Dawson J appeared to accept in Polyukhovich186, that there was no 182 Constitution, s 51(xxix). 183 Australian Communist Party v The Commonwealth (1951) 83 CLR 1. 184 (1951) 83 CLR 1 at 189-195; cf at 161. 185 Mobil Oil Australia Pty Ltd v Victoria (2002) 211 CLR 1 at 22-26 [7]-[18], 33-38 [45]-[62], 53-58 [111]-[121]; cf at 82 [188]. See also Australia Act 1986 (Cth), 186 (1991) 172 CLR 501 at 632. Kirby danger to the federal-State balance in the geographical externality principle, appears erroneous or at least doubtful in the light of provisions such as ss 50DA and 50DB of the Crimes Act. In constitutional terms, this particular issue might not be a large problem. However, it cannot be said to be "of no moment"187, at least in the present case. The plaintiff complained that the Commonwealth had confused the expansion of the extraterritorial operation of a constitutional power that already exists and the expansion of the power itself, beyond its previously acknowledged ambit. The plaintiff urged this Court to return to adherence to that distinction, which, he said, was essential to the scheme of a written federal Constitution that divided power between the several lawmakers in Australia and demanded conformity with its provisions if enacted law were to be valid. Whilst accepting that the grant of power to the Federal Parliament to make laws for the peace, order and good government of the Commonwealth was expressed in the language of a grant and not in terms of a limitation upon power, the plaintiff argued that the character of the federal Constitution and its purposes required a relevant nexus to exist between the constitutional interests of the Commonwealth and the subject matters to which an enacted federal law was addressed. To the extent that such a law went beyond "external affairs", in the sense of the relationships between nation states (and now relationships with international organisations), it exceeded the proper subject matter of s 51(xxix) of the Constitution. It was therefore invalid. Alternative validity and the avoidance of problematic issues Conflicting features of the Constitution: The arguments of the plaintiff in this case have planted a doubt in my mind concerning the geographical externality principle. It is a doubt that was not previously there. I do not accept, as the plaintiff urged, that the Polyukhovich principle should be overruled. However, the plaintiff's submissions call attention to some difficulties in the "modern doctrine" that have not, so far, received sufficient attention from this Court. Such attention may be needed in future cases where the sole constitutional foundation available or propounded for a federal law is that it is made with respect to facts, persons or things external to Australia, without connection otherwise to relationships with other nation states and with international organisations that seem to be implied by the composite expression "external affairs". In accepting arguments about the scope of federal legislative powers, this Court should be conscious of two important and sometimes conflicting features 187 Cf reasons of Gummow, Hayne and Crennan JJ at [39]. Kirby of the Constitution. The first is the federal character of the polity thereby created. This introduces checks and balances. It divides the power of lawmaking. The divisions are essential to the constitutional design. They are also protective of individual liberties and personal freedoms. Liberties and freedoms can sometimes be endangered by the concentration of power within modern government188. It may therefore be necessary for this Court to look afresh at its federalism jurisprudence to ensure that it accords with the constitutional text and purpose. The second feature is the functional capacity of the Constitution to adapt so as to be relevant to a world in which Australia must now operate as an independent nation state – a world quite different from that of 1900. In that world, there are now so many facts, persons and things external to Australia's geographical borders that, if this is accepted as a valid criterion for sustaining federal laws applicable to facts, persons and things within Australia, there would be almost no limit to the lawmaking power thereby accorded to the Federal Parliament. This is why Brennan J in Polyukhovich189 proposed the need for some additional factor of connection ("nexus" with Australia) to reconcile the second stated feature with the first. The present case suggests to me that the Court needs to revisit Brennan J's reasoning and to elaborate the geographical externality principle further before applying it as an accepted doctrine of Australian constitutional law. Avoiding problematic issues: Having identified the problems raised by the plaintiff, I can circumvent them in this case. There is, in my view, an alternative foundation for the constitutional validity of the challenged provisions of the Crimes Act. At the risk of being criticised as "unduly timorous or full of self- doubt"190, I will therefore place the geographical externality principle aside in the present case. I will do so because of what I regard as unresolved difficulties that can be left to another day. The main alternative bases propounded by the Commonwealth for affirming that the impugned provisions of the Crimes Act constitute laws with respect to "external affairs" were that, on the uncontested materials placed before 188 Thus in Australia, whatever the inconvenience, the military are always subject to "civil power [and] constitutional norms": see X v The Commowealth (1999) 200 CLR 177 at 230 [166]. 189 (1991) 172 CLR 501 at 552-553. 190 Allan, "'Do the Right Thing' Judging? The High Court of Australia in Al-Kateb", (2005) 24 University of Queensland Law Journal 1 at 11. Kirby this Court, they were laws with respect to a "matter of international concern" or laws affecting Australia's external relationships with other nation states and with international organisations. Should either of these arguments be accepted? Do they sustain the provisions of the Crimes Act as valid laws, made under the Constitution? A matter of international concern The Commonwealth's submissions: The Commonwealth submitted that, on the basis of the materials received by the Court, the challenged provisions of the Crimes Act were supported by the external affairs power on the footing that they were laws with respect to a "matter of international concern" and thus within the ambit of s 51(xxix) of the Constitution. In past decisions of this Court, several Justices have suggested that the criterion "matter of international concern" describes a proper subject of the Commonwealth with respect to which the Federal Parliament is empowered under the Constitution to enact laws191. the "external affairs" of An obvious difficulty with the expression "matter of international concern" is that, at its widest, it could refer to a diverse multitude of topics, lacking any precise definition or meaning192. As long ago as 1936, Latham CJ recognised the impact on time and space of modern inventions which imposed on nations everywhere (including Australia) a duty to "endeavour to discover means of living together upon practicable terms"193. In the intervening seventy years, the dimensions of international concern have expanded exponentially. Evidence in the materials received by this Court in the present case for such "international concern" in respect of sexual offences by foreign nationals against children included: The adoption by the General Assembly of the United Nations on 20 November 1989 of the CRC, which had entered into force in 1990194; 191 See, eg, Koowarta (1982) 153 CLR 168 at 217 per Stephen J. See also at 235 per Mason J, 242 per Murphy J; cf at 202, 207 per Gibbs CJ. 192 Polyukhovich (1991) 172 CLR 501 at 561 per Brennan J, 657 per Toohey J. See also reasons of Callinan and Heydon JJ at [219]. 193 Ex parte Henry (1936) 55 CLR 608 at 640. 194 The CRC, Art 19 commits state parties to take "all appropriate legislative ... measures to protect the child from all forms of ... injury or abuse ... including sexual abuse, while in the care of ... any ... person who has the care of the child". Article 34 commits state parties to "protect the child from all forms of sexual (Footnote continues on next page) Kirby The adoption by the General Assembly of the United Nations on 25 May 2000 of the Optional Protocol to the CRC195; The appointment by the Secretary-General of the United Nations196 of a Special Rapporteur on the Sale of Children, Child Prostitution and Child Pornography with a mandate to report on those topics to the United Nations Commission on Human Rights. According to an early report by the Special Rapporteur, he welcomed the Australian laws in question in this case as a desirable response to the "transnational sexual exploitation of children"197; The adoption annually between 1994 and 1997 of resolutions of the United Nations Commission on Human Rights, addressed, amongst other things, to promoting effective international responses to transnational problems of child abuse; The signature of particular Memoranda of Understanding in 1997 and 1998 between the Government of Australia and, respectively, the governments of the Philippines and the Fiji Islands, designed to combat child sexual abuse committed by Australian nationals in such countries198; exploitation and sexual abuse [including by] national, bilateral and multilateral measures". 195 The Protocol commits state parties to prohibit child prostitution (Art 1) and to establish jurisdiction, relevantly "[w]hen the alleged offender is a national of that State or a person who has his habitual residence in its territory" (Art 4.2(a)). Although not binding on Australia at any relevant time, the Protocol entered into force generally on 18 January 2002. 196 Pursuant to United Nations Commission on Human Rights, Resolution 1993/82. 197 United Nations, Report to the Commission on Human Rights of the Special Rapporteur on the Sale of Children, Child Prostitution and Child Pornography (Mr Vitit Muntarbhorn), Economic and Social Council, E/CN.4/1994/84 (14 January 1994) at [170]. See also at [166]-[169]. 198 Memorandum of Understanding Between the Government of Australia and the Government of the Republic of the Philippines for Joint Action to Combat Child Sexual Abuse and Other Serious Crime, 11 October 1997; Australia-Fiji Memorandum of Understanding for Joint Action to Combat Child Sexual Abuse and Other Serious Crimes, 18 December 1998. Kirby The enactment by a large number of nation states199 of legislation providing for criminal offences in respect of sexual conduct of their nationals with children outside the national borders of the states concerned; and The report published by the House of Representatives Standing Committee on Legal and Constitutional Affairs on the 1994 Bill that introduced into the Crimes Act the provisions the subject of the present proceedings200. Against the background of this international and national evidence, the Commonwealth submitted that, whatever the precise ambit of the expression "matter of international concern" might be, the subject of sexual offences against children by Australian nationals in foreign countries was such a matter. It was therefore one that attracted the power to enact laws under s 51(xxix) of the Constitution. The contrary arguments: In resisting these submissions, the plaintiff repeated many of his earlier arguments to challenge the proposed criterion of "matter of international concern". Once it is accepted that the legislative power with respect to "external affairs" is not confined, as such, to giving effect to binding treaties, the plaintiff acknowledged that some other verbal explanation had to be found to support legislation apt to the full engagement of Australia with the external world, as it now exists. The plaintiff complained that the suggested criterion of a "matter of international concern" was far too broad to provide a stable and meaningful foundation for the legislative validity of federal laws under s 51(xxix) of the Constitution. On this view, some additional adjectival qualification (such as "real", "genuine", "widespread", "pressing", "established" or "undisputed") had to be deployed to confine the power to an ambit that is clear and proper to its context201. Alternatively, some other controlling requirement must be introduced, 199 The Commonwealth's submission stated, by reference to an international survey, that thirty-four countries had enacted such laws and that two others (Argentina and South Africa) had such laws in preparation at the time of the survey. 200 Australian Parliament, House of Representatives, Standing Committee on Legal and Constitutional Affairs, Report on the Crimes (Child Sex Tourism) Amendment Bill 1994 (May 1994) at 1-3 [1.2.1]-[1.2.8]. 201 The context includes the existence of the power in a Constitution of defined and limited federal powers that is intended to operate in a polity that is divided into federal, State and Territory governments. Kirby by an alternative verbal formula (such as having a strong "nexus between Australia and the supposed subject of external affairs" or "capable of being reasonably considered to be 'appropriate or adapted'" to addressing the concern202) so as to prevent any suggested "matter of international concern" from becoming a means that would destroy the federal character of the Australian Constitution. Certainly, a vastly increased number of matters are now of "international concern". They expand every day. As a criterion of federal law, the concept would therefore be virtually limitless and potentially destructive of Australian federal arrangements. It is desirable that the Federal Parliament, as the legislature of the national government of Australia, should be able to make laws with respect to matters of international concern to the fullest extent possible as the legislatures of other independent nations may do. However, this is subject to certain qualifications203. First, such laws must conform to the constitutional requirements stated in an instrument of government of defined and limited powers. Relevantly, they must be laws with respect to "external affairs". Secondly, they must be laws compatible with the divisions of power within the federal polity. Thus, at the very least, they must not, in the guise of being laws with respect to "external affairs", endanger the continued existence and constitutional viability of the States provided for in the Constitution. Thirdly, any such laws must conform to the other requirements of the Constitution, such as those contained in Ch III. The notion that the Federal Parliament in Australia must have plenary and untrammelled power to make laws having some relationship to international or external concerns is not one that is unarguably consistent with such a carefully calibrated, limited and federal constitutional document. The powers of the Parliament under s 51(xxix) are broad indeed. They are more than ample for most purposes. But they are not and cannot be unlimited. It is the Constitution that limits them. And it is the duty of this Court to uphold the limits. Conclusion: an undeveloped concept: As with the geographical externality principle, I prefer to put this second argument of the Commonwealth to one side. The suggestion that the constitutional validity of federal laws could be demonstrated by showing that they were made with respect to a "matter of international concern" is still undeveloped in Australia204. This second argument 202 Reasons of Callinan and Heydon JJ at [221]. 203 See, eg, Re Wakim (1999) 198 CLR 511. 204 Reasons of Callinan and Heydon JJ at [217]. Kirby may, like the first, assign insufficient attention to the appearance of the word "external" in connection with the word "affairs". It is therefore appropriate to move, finally, to the third argument for validity advanced by the Commonwealth, namely that the contested law is one with respect to the international relationships of Australia with other nation states and international organisations and on that basis is within the external affairs power of the Constitution. I can take this step immediately because, as will appear, I am of the view that it provides a convincing argument for validity. It is an argument that gives full force to the word "affairs" in the constitutional grant. It is also one that is consistent with the long-standing authority of the Court that the power afforded in s 51(xxix) is one concerned at its core with international relationships. Relationships with nation states and international organisations The active nationality principle: The understanding of how this third explanation of the ambit of "external affairs" comes about first requires brief mention of a development of international law that occurred during the first century of the Commonwealth. Starting from a general principle that "crime is local" and historically part of the public law of a nation205, international law might have developed in a way that forbade one nation state making its own laws imposing criminal liability by reference to the conduct of its own nationals within the territory of another nation state206. Such laws might have been viewed as an infringement by the former nation state of the sovereign rights of the latter. However, this is not the way international law in fact developed. Instead, the active nationality principle holds that "[t]here is no restriction on the competence in international law of a State to prosecute its own nationals for acts done on foreign territory"207. In the present case, both Thailand (under the territorial principle) and Australia (under the active nationality principle) could exercise jurisdiction over the plaintiff in full conformity with international law. The international relations of nation states, including those of Australia and 205 Lipohar v The Queen (1999) 200 CLR 485 at 497 [15], 542 [141], 546-547 [154]. 206 See, eg, the dissent of Judge Moore in The Case of the SS "Lotus" (1927) Permanent Court of International Justice (Series A, No 10) at 92-93. 207 Aird (2004) 220 CLR 308 at 347 [123] quoting O'Connell, International Law, 2nd ed (1970), vol 2 at 824. See also Shearer, Starke's International Law, 11th ed (1994) at 210-211; Shaw, International Law, 5th ed (2003) at 588-589; Restatement of the Foreign Relations Law of the United States, 3d, §421(2)(d); cf reasons of Gleeson CJ at [4]. Kirby Thailand, have developed in accordance with this principle of international law. Indeed, the principle has been clear, at least since the decision of the Permanent Court of International Justice in The Case of the SS "Lotus"208 more than seventy years ago. Necessarily, a prosecution based on the active nationality principle affects, to some degree, the external relations of Australia with other nation states, notably in this case with Thailand. It does so because both nations assert a right to impose criminal liability by reference to events that happened within the territory of Thailand and which involved alleged conduct with at least one person there who, by inference, is a Thai national or resident. That person and possibly others in Thailand might be called upon to give evidence in a prosecution of the plaintiff. Some might possibly have to come to Australia for that purpose. To this extent, the relations between Australia and a country external to Australia, namely Thailand, are affected, to some degree at least, by the provisions of the Crimes Act whose validity the plaintiff contests. Once a relationship with another nation state is enlivened (as it necessarily is in the facts of the present case) there is incontestably an "external affair". No doubt or hesitation can arise in the attribution of that phrase to the relationship between states that is inherent in the criminal process envisaged in the present case by the contested provisions of the Crimes Act. That the provisions intended to enliven the foregoing principle of international law governing the relations between nation states is clear from the terms of s 50AD of the Crimes Act stating that a person must not be charged with an offence of the impugned kind, allegedly committed outside Australia, unless, at the time of the offence, the person was an Australian citizen or a permanent resident of Australia. On the facts contained in the stated case, the plaintiff's Australian citizenship sufficiently enlivens that provision. It afforded a clear connection between the plaintiff and the subject matter of the federal law209. On this footing, within this view of the ambit of s 51(xxix) of the Constitution, power existed under that paragraph to enact the law. As the notion of the power of the Federal Parliament to enact laws having extraterritorial 208 (1927) Permanent Court of International Justice (Series A, No 10) at 18-20. 209 Polyukhovich (1991) 172 CLR 501 at 551-553 holding that there must be some "nexus ... between Australia and the 'external affairs' which a law purports to affect". Kirby operation was enlarged210, the impediments to the making of such federal law evaporated so long as the relationship with another state was affected by the intended prosecution. Subject to what follows, the effects on the relationship with Thailand (and in other cases with other nation states by the very terms of the contested provisions of the Crimes Act) sufficiently found the validity of the provisions in s 51(xxix) of the Constitution. Characterisation of the law: There are dicta in the cases that might be understood as suggesting that the courts should defer to the Federal Parliament or the Executive of the Commonwealth in the determination of the relations of Australia with other nation states and with international organisations. Such dicta might suggest that whether such relations sustain laws of the impugned kind is a matter exclusively for the Parliament or the Executive to decide211. Certainly, in the Australian system of government, the conduct of foreign relations is peculiarly the responsibility of the Executive Government of the Commonwealth212. It is not, as such, a responsibility of courts. Nevertheless, the rule of law is a foundational principle of the Australian Constitution. It is inherent in the provisions and purposes of Ch III of the Constitution. This Court cannot surrender, or renounce, its duty of determining the character of a law where the constitutional validity of that law is questioned. The Parliament cannot, by preamble or statutory assertion, exclude the courts from the performance of their constitutional function to decide contested questions as to the meaning and validity of a federal law. This is as true of a law said to be supported by s 51(xxix) of the Constitution as one supported by any other source of constitutional power. It is not necessary in this case to explore this issue further. The Commonwealth did not rely solely on the language of the Crimes Act, without more. On the contrary, it placed much material before this Court to explain the background and purpose of that law. That material was received as affording constitutional facts upon which the Court was invited to act. 210 Seas and Submerged Lands Act Case (1975) 135 CLR 337 at 497-498, cited by 211 Polyukhovich (1991) 172 CLR 501 at 530-531 per Mason CJ: "It is enough that Parliament's judgment is that Australia has an interest or concern. It is inconceivable that the Court could overrule Parliament's decision on that question." Cf Horta (1994) 181 CLR 183 at 194. 212 Attorney-General (United Kingdom) v Heinemann Publishers Australia Pty Ltd (1988) 165 CLR 30 at 50-51 per Brennan J. See also Thorpe v The Commonwealth [No 3] (1997) 71 ALJR 767 at 777-779; 144 ALR 677 at 689-692. Kirby The facts so received unquestionably demonstrated the active involvement of many states, including Australia, in multilateral and bilateral relationships designed to respond effectively to sexual offences by the nationals of those states against children in other states. As well, active debates in the agencies of the United Nations and in other international and regional bodies over the past two decades have concerned the protection of children from sexual conduct on the part of foreign nationals. The material received by the Court affords clear evidence that the subject matter of the challenged provisions of the Crimes Act is (and already was when the law was enacted) one relevant to the external relations of Australia with the international organisations concerned. The participation of many nation states in the activities of such international organisations reinforces the conclusion already reached that the subject of the law is one with respect to the relations of the Commonwealth with nation states other than Australia and thus within s 51(xxix) of the Constitution213. Conclusion: validity is sustained: Subject to what follows, this conclusion is sufficient to sustain the constitutional validity of the impugned provisions of the Crimes Act. These provisions are shown to be laws with respect to the relationships (relevantly between Australia and Thailand) affected by the alleged conduct in Thailand of an Australian national. They also affect the relationship between Australia and the United Nations treaty body with responsibility for the implementation of the CRC, a treaty that Australia has ratified. Upon this basis, even on a qualified understanding of the external affairs power, a constitutional foundation for the challenged law is proved. The law, although having operation within Australia, is made with respect to Australia's international relationships. It is thus valid under the Constitution as a law with respect to "external affairs". The proportionality argument fails An argument of proportionality: The plaintiff had one last argument. It was not expressed in terms of proportionality. However, that is what, in my view, the argument involved. The plaintiff complained that, even if the constitutional criteria postulated by the Commonwealth for the validity of a federal law on sexual conduct of Australian nationals and permanent residents 213 Cf R v Sharkey (1949) 79 CLR 121 at 136. See also Seas and Submerged Lands Act Case (1975) 135 CLR 337 at 450 per Stephen J; Koowarta (1982) 153 CLR 168 at 190-191 per Gibbs CJ, 221 per Stephen J, 234 per Mason J; Kirmani v Captain Cook Cruises Pty Ltd [No 1] (1985) 159 CLR 351 at 439 per Deane J. Kirby with children outside Australia were established214, the impugned provisions of the Crimes Act extended beyond, and differed from, these criteria. The plaintiff argued that the provisions of the law, in their potential field of operation, were invalid because the contested sections of the Crimes Act far overreached the power relied upon. Having regard to the preceding analysis, the question so presented arises for me only in respect of that elaboration of the external affairs power expressed in terms of the relationships of Australia with foreign states and international organisations. Accepting that criterion, is the contested law disproportionate (that is, not "reasonably appropriate and adapted")215 to the exercise of the external affairs power so understood? In support of this argument, the plaintiff pointed to a number of features of the law. Thus, the relevant provisions of the Crimes Act are not confined (as they might have been) to the implementation of a treaty (such as the Protocol to the CRC) or even, if that would be valid, of any Memorandum of Understanding with Thailand, such as those that have since the enactment of the law been negotiated with the Philippines and the Fiji Islands. The result, so the plaintiff submitted, was a law of general application that imposed Australian criminal sanctions upon conduct occurring overseas, included some conduct that was not criminal in the place where the conduct happened. This was so in the case of Thailand where the age of consent was said to be fifteen years, not sixteen as provided in the Crimes Act of Australia. A fortiori, the law also applied to events involving Australian citizens and permanent residents in countries with substantially lower ages of consent for lawful sexual relations. For instance, Canada adopts a general age of consent of fourteen years for most sexual activity. The same age is said to apply in Albania, Croatia, China, Colombia, Germany, Hungary and Iceland. In some countries, such as Chile and Mexico, the age of consent is said to be twelve years216. 214 Namely (1) geographical externality to Australia of the relevant facts, persons or things; (2) being with respect to a matter of international concern, however delimited; and (3) its impact on the relations of Australia with foreign states and international organisations. 215 Cf Cunliffe v The Commonwealth (1994) 182 CLR 272 at 300, 324, 338, 387-388; Lange (1997) 189 CLR 520 at 567 fn 272; Theophanous v The Commonwealth [2006] HCA 18 at [68]-[71]. 216 Conventionally, under English, Scots and other law, the male age of consent to sexual intercourse for the purpose of marriage was 14 years and for females 12 years, a fact reflected in several royal marriages: see Lee, 1603, (2003) at 92. Large numbers of women were married in England at the age of 15 years well into the nineteenth century: Wilson, The Victorians, (2002) at 324. Kirby In these circumstances, the plaintiff asked how criminalising, according to Australian law, conduct that was not criminal where it occurred could ever possibly affect the relationships between nation states or with international organisations? Instead, he submitted, the law represented an illegitimate and over-extensive attempt, beyond the available federal power, to impose Australian cultural norms on activities happening elsewhere in the world. The spectre was presented of an adult Canadian citizen who was an Australian permanent resident being prosecuted on his return to Australia for consensual sexual intercourse or activity lawful in Canada with a person older than fourteen but younger than sixteen years217. Alternatively, the danger was propounded of the Federal Parliament, supposedly based on Australia's relationships with other nation states or international organisations, enacting laws cutting across different laws enacted by the Australian States on a wide range of matters. Different ages of consent for the purposes of State and Territory criminal laws have long been a feature of Australian legislation218. The potential use of federal law to undermine the effect of reforms achieved by States and Territories locally was implicit in these submissions. In default of a provision limiting criminal liability in Australia to a case of equivalent liability in the place where the relevant events occurred219, the plaintiff argued that the true character of the impugned law was not, as asserted, a law with respect to the external relationships of the Commonwealth with other nation states or international organisations. It was revealed, instead, as a law with respect to a crime involving a matter of postulated domestic concern for which the Federal Parliament had no applicable the Constitution. legislative power under 217 Criminal Code (Canada), s 151. 218 Bronitt and McSherry, Principles of Criminal Law, 2nd ed (2005) at 602. The authors trace the variations and changes to the age of consent in Australia to "successive moral panics about white sex slavery in the 1880s, the anti-homosexual campaigns of the 1950s and child pornography in the 1970s"; cf Bavin-Mizzi, "Understandings of Justice: Australian Rape and Carnal Knowledge Cases, 1876- 1924", in Kirkby (ed), Sex Power and Justice, (1995) 19. 219 As in the Sexual Offences Act 2003 (UK), s 72. In New Zealand an extraterritorial offence is created of engaging outside New Zealand in sexual conduct with a child which, if done in New Zealand, would be an offence against the Crimes Act 1961 (NZ). See Crimes Amendment Act 1995 (NZ), s 2 inserting s 144A into the Crimes Act. Kirby The law is proportionate: Having regard to the terms of the impugned provisions of the Crimes Act, these arguments should not be accepted in the circumstances of this case. Assuming for present purposes that the constitutional power cannot rely on a criterion of operation merely by reference to geographical externality, and putting aside the suggested criterion of a "matter of international concern", the remaining explanation of s 51(xxix) of the Constitution suffices to sustain the validity of this law. This is so despite apparent discrepancies in the operation of the federal law in particular cases. True, there is no statutory reason why an instance of the kind postulated involving the hypothesised Canadian citizen could not arise220. However, in a law of general application applying to acts occurring anywhere other than Australia, such discrepancies are bound to arise in a minority of instances because the Australian federal legislation chooses to adopt a uniform age of consent of sixteen years. The prosecutorial discretion; the judicial conduct of the trial; the common sense of juries; and the exercise of discretions in any punishment that is imposed might respond to disparities of the kind complained of by the plaintiff, were they to arise in practice. Such disparities do not deprive the provisions of the Crimes Act under which the plaintiff has been charged of the constitutional character that sustains their validity upon the basis that I have explained. They remain laws with respect to Australia's relationships with other nation states, in this case Thailand. And for constitutional validity that is enough. It may be said that, if laws of the present kind were to become common, other countries could impose on people criminal responsibility for acts, not necessarily sexual, done or omitted whilst in Australia, although such acts are perfectly lawful here. However, these are complaints that do not affect the validity of the law contested in this case. There was no suggestion in the materials before this Court that any particular problem had arisen out of the legislation of a very large number of nation states that have already imposed extraterritorial criminal liability upon their nationals for offences against children occurring in foreign jurisdictions221. The age of sixteen chosen by the Federal Parliament is now the most common age of consent applicable in Australian criminal law222. In so far as it is relevant to determining the constitutional 220 The provisions of the Criminal Code (Cth), s 10.5 do not appear to limit prosecutions of persons for offences by reference to the definition of a "law", as there appearing, which refers to a "law of the Commonwealth". See [2005] HCATrans 957 at 1465, 1485. 221 Set out in ECPAT International, Child Sex Tourism Action Survey, (April 2001) at 222 Bronitt and McSherry, Principles of Criminal Law, 2nd ed (2005) at 605. Kirby question of proportionality ("reasonably appropriate and adapted"), and thus the constitutional character of the law, the Australian legislation is neither unusual nor impermissibly overreaching. It appears generally consistent with laws passed by many other nation states. That feature of the law brings it within the external affairs power of the Constitution as that power has long been understood. the Commonwealth: The validity of the impugned law can therefore be decided in the present case without reaching any final conclusion on the more difficult constitutional namely "geographical arguments propounded by externality" and "matter of international concern". In my view, both of these arguments require further analysis and elaboration to ensure that they are consistent with the essential constitutional postulate of federalism and with the notion inherent in that postulate that the Constitution is one of divided and limited lawmaking powers. Such division is often the best safeguard of limited government and of personal freedom. It is therefore a division to be cherished and safeguarded. When it is at any risk, it behoves this Court to proceed with caution. Conclusion: the legislation is valid The provisions of the Crimes Act contested by the plaintiff are valid federal laws. They are sustained by s 51(xxix) of the Constitution. They are validly made with respect to Australia's external relations with other nation states and with international organisations. The provisions of the Crimes Act relevant to this case are proportionate to the exercise of the power so granted to the Federal Parliament for that purpose. That is sufficient to uphold validity. Other the suggested arguments advanced by constitutional validity of the disputed laws do not therefore need to be decided. the Commonwealth to support The foregoing are my reasons for joining in the orders announced by the Court at the end of argument on 17 November 2005223. 223 [2005] HCATrans 957 at 3160. CALLINAN AND HEYDON JJ. The legislation and background circumstances are set out in other judgments. The defendant contended that ss 50BA and 50BC of the Crimes Act 1914 (Cth) were valid on four bases224. (a) A law that operates on conduct geographically external to Australia is necessarily a law with respect to external affairs within the meaning of s 51(xxix) of the Constitution225. (b) A law that operates on conduct geographically external to Australia necessarily affects Australia's external relations and is thus a law with respect to external affairs. In any event, ss 50BA and 50BC are laws in fact concerning Australia's external relations. Sections 50BA and 50BC are laws with respect to external affairs on the basis that the extraterritorial prohibition of the sexual exploitation of children is a matter of sufficient international concern. The arguments of the plaintiff denying validity are to be preferred. They correspond broadly with the reasoning set out below. Is a law that operates on conduct geographically external to Australia a law with respect to external affairs? The defendant urged an affirmative answer. That answer is supported by three decisions of, and numerous dicta in, this Court. The view reflected in that answer will be called the "geographic externality" view of s 51(xxix) for short. 224 The defendant did not contend that the legislation was supportable as being reasonably appropriate and adapted to give effect to a treaty to which Australia is a party, such as the Convention on the Rights of the Child; nor as fulfilling any obligations Australia may have under customary international law; nor as falling under any head of power other than s 51(xxix); nor as capable of validation by being read down. 225 Section 51(xxix) provides: "The Parliament shall, subject to this Constitution, have power to make laws for the peace, order, and good government of the Commonwealth with respect to: (xxix) external affairs". Approaches to construction. The defendant submitted that the correct question in the present context is: what do the words "external affairs" mean "to us as late twentieth century Australians?"226 This is hard to square with many statements by members of this Court227 that the constitutional words bear the meaning "they bore in the circumstances of their enactment by the Imperial Parliament in 1900"228. It is also hard to square with the following unanimous statement by the Court about the history of s 92229: "Reference to the history ... may be made, not for the purpose of substituting for the meaning of the words used the scope and effect – if such could be established – which the founding fathers subjectively intended the section to have, but for the purpose of identifying the contemporary meaning of language used, the subject to which that language was directed and the nature and objectives of the movement towards federation from which the compact of the Constitution finally emerged." These inquiries seem pointless unless, in general, the meaning of an expression in the Constitution like "external affairs" comprises the meanings which skilled lawyers and other informed observers of the federation period would have attributed to it, and, where the expression was subject to "dynamism"230, the meanings which those observers would reasonably have considered it might bear in future. What individual participants in the Convention debates said it was intended to mean, or meant, either during those debates or later, is no doubt immaterial, save to the extent that their linguistic usages are the primary sources from which a conclusion about the meaning of the words in question can be drawn. Further, no doubt the mere fact that a particular instance of the 226 Re Wakim; Ex parte McNally (1999) 198 CLR 511 at 553 [44] per McHugh J. 227 For example, those quoted by McHugh J in Eastman v The Queen (2000) 203 CLR 228 King v Jones (1972) 128 CLR 221 at 229 per Barwick CJ. 229 Cole v Whitfield (1988) 165 CLR 360 at 385 per Mason CJ, Wilson, Brennan, Deane, Dawson, Toohey and Gaudron JJ (emphasis added). See also State of Tasmania v The Commonwealth of Australia and State of Victoria (1904) 1 CLR 329 at 358-360 per O'Connor J; Breavington v Godleman (1988) 169 CLR 41 at 230 Grain Pool of Western Australia v The Commonwealth (2000) 202 CLR 479 at 496 [23] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ. expression "external affairs" was not foreseen, or could not have been foreseen, in 1900, does not conclusively indicate that the instance in question could not now fall within it231. But, subject to considerations of those kinds, it might be asked whether it is not legitimate to seek to measure the ambit of the power by reference to the meaning which, in 1900, that expression bore or might reasonably have been envisaged as bearing in the future. In this case, the question of the extent to which views contemporary with the federation period should be taken into account is not crucial and need not be decided. That is because in relevant respects the meaning held then and the meaning which the words bear now are identical. The constitutional structure. Dealings between Australia and the rest of the world rest on two constitutional foundations: the power vested in the executive under s 61 and the power granted to the legislature under s 51(xxix). At least for a time after 1901, the executive did not enter treaties directly with other nations to any significantly greater extent than the Australian colonies had. Now it does so routinely. But entry into a treaty or other international agreement may make it appropriate to enact legislation to give it domestic force, as, for example, where legislation is desirable to secure to Australian citizens the benefits which entry into the treaty was designed to bring. That is the function which the legislative power granted by s 51(xxix) serves. In Victoria v The Commonwealth (Industrial Relations Act Case)232 the joint judgment demonstrated, by detailed reference to developments before and at the time of federation, that: (a) while before 1900 the Imperial Government negotiated treaties on behalf of itself and the colonies, there was a practice of consulting those colonies that, like the Australian colonies, had advanced towards constitutional independence, before concluding commercial treaties that applied to them; 231 Victoria v The Commonwealth (Industrial Relations Act Case) (1996) 187 CLR 416 at 482 per Brennan CJ, Toohey, Gaudron, McHugh and Gummow JJ. 232 (1996) 187 CLR 416 at 476-484 per Brennan CJ, Toohey, Gaudron, McHugh and Gummow JJ. Similar points are made by Twomey in "Sue v Hill – The Evolution of Australian Independence", in Stone and Williams (eds), The High Court at the Crossroads: Essays in Constitutional Law, (2000) 77 and "Federal Parliament's Changing Role in Treaty Making and External Affairs", in Lindell and Bennett (eds), Parliament: The Vision in Hindsight, (2001) 37. The analysis puts in doubt or qualifies several factual assertions made in The Commonwealth v Tasmania (The Tasmanian Dam Case) (1983) 158 CLR 1 at 124 and 126 per Mason J. there was also a practice of including in those treaties a clause providing for the voluntary adherence of a colony; the number and range of treaties entered by the Imperial Government had increased and was continuing to increase; there also existed international organisations in which constituent parts of the British Empire like the Australian colonies had the vote; and there was a practice of leaving colonial legislatures free to determine whether it was necessary to legislate to give effect to a treaty entered into by the Imperial Government. Contemporary lawyers would have foreseen that Commonwealth legislation of that kind would be needed in relation to the same type of treaty, whether with nation States or international organisations, after 1900. Now, of course, Commonwealth legislation implements only treaties entered into by the executive of the Commonwealth, rather than, as was the case in the early years after 1900, treaties largely entered into by the Imperial authorities. But that fact is, as counsel for the defendant said, merely a "fresh denotation" of s 51(xxix) arising out of the development of Australia's international personality233. Usages in the federation period. It is clear that in the federation period skilled lawyers and other informed observers gave "external affairs" a meaning which included relations between the Commonwealth and other parts of the British Empire, and also relations between the Commonwealth and nations outside the Empire. Evatt and McTiernan JJ were of that view in R v Burgess; Ex parte Henry234. In support of that view, they pointed to, among other things, linguistic usages, in 1887 and 1902 respectively, by British statesmen who were exceptionally knowledgeable about Imperial and colonial affairs – Sir Charles 233 Thus Mason J, after contending that the framers' expectations in relation to s 51(xxix) were irrelevant, pointed out that in any event the difference between those expectations and events as they actually fell out "seems to have been a difference in the frequency and volume of external affairs rather than a difference in kind": The Commonwealth v Tasmania (The Tasmanian Dam Case) (1983) 158 CLR 1 at 126-127. 234 (1936) 55 CLR 608 at 684-685. Other examples of those usages can be found in the House of Commons debates on the Commonwealth of Australia Constitution Bill in 1900. The most distinguished lawyers and political thinkers in the House attended and participated in these debates – for example, H H Asquith, R B Haldane, James Bryce and Sir William Anson – and in this fact there lay a certain safeguard against any nonchalance or thoughtlessness on the part of members of the Government. The statements referred to below are cited, not necessarily as accurate accounts of the effect of s 51(xxix), but as examples of contemporary usage. In his speech introducing the Bill, Joseph Chamberlain, Secretary of State for the Colonies, made a plain allusion to the external affairs power and to s 61: "everything which has to do with the exterior relations of the six colonies concerned will be a matter for the Commonwealth, and not for the individual Governments"235. A little later in that speech, while arguing for the preservation of Privy Council appeals, the Secretary of State cited s 51(xxix) among other placita to which he called "special attention" because they involved interests outside Australia as well as "locally". He said "external affairs" was "a phrase of great breadth and vagueness, which, unless interpreted and controlled by some other provision, might easily ... give rise to serious difficulties". He went on: "It will be seen that almost all the points to which I have thus called special attention are matters in which the Imperial Government may have to deal with foreign countries. It is important, therefore ... that measures of this kind, which may involve the Imperial Government in the most serious responsibility, should be interpreted by a tribunal in which all the parties have confidence."236 On 21 June 1900, Sir Robert Finlay, the Attorney General, said that s 51 contained "certain most important powers not now enjoyed at all by any of the Australian colonies, such as powers with reference to foreign affairs"237. It is not in dispute that the expression "external affairs" was used in s 51(xxix) in preference to "foreign affairs" in order, as Brennan CJ, Toohey, Gaudron, McHugh and Gummow JJ have said, "to make it clear that the power comprehended both the relationship between the Commonwealth of Australia and other parts of the then British Empire and the relationship with foreign 235 United Kingdom, House of Commons, Parliamentary Debates (Hansard), 14 May 1900 at 46 (emphasis added). 236 United Kingdom, House of Commons, Parliamentary Debates (Hansard), 14 May 1900 at 54-55 (emphasis added). 237 United Kingdom, House of Commons, Parliamentary Debates (Hansard), 21 June 1900 at 648 (emphasis added). countries"238. That language is significant. It points against the grant of a wider power to legislate on matters located externally to Australia. It points towards a more specific power for the legislature to act in a manner complementing the executive's conduct of Australia's relationships with foreign nations and international organisations. If "external affairs" are those which relate to relationships between countries, it is necessary to identify the particular relationship on which the legislation relying on s 51(xxix) rests. A "relationship" in this sense means a dealing between Australia and another country. That dealing can be a treaty, but it need not be: any of a vast range of diplomatic relationships between Australia and other countries could, depending on the circumstances and subject to the Constitution, be a relevant dealing. On this view, what "external affairs" cannot include is something which is the subject of a unilateral act or desire on the part of Australia. That lacks the mutuality inherent in the conduct of "affairs" in the sense of a relationship or dealing with another nation or an international organisation. The plaintiff's contention that the power to legislate in relation to external affairs extends beyond legislation implementing treaties to other relationships with other countries, but not beyond that point to include legislation about geographically external matters, is supported by other material reflective of the views of distinguished lawyers contemporary with the federation period, or persons acquainted with those views. While the writers and judges now to be referred to were not considering the precise point under consideration in this case, what they said suggests that the meaning of "external affairs" in the federation period did not include the geographic externality view. In chronological order, the first opinion to consider is that of Quick and Garran. Their conclusion on s 51(xxix) was239: "As already pointed out[240], it can hardly be intended to confer extra- territorial jurisdiction; where that is meant, as in other sub-sections, it is 238 Victoria v The Commonwealth (Industrial Relations Act Case) (1996) 187 CLR 416 at 482 (emphasis added). 239 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, 240 Earlier, Quick and Garran had pointed out that the only provisions in the Constitution Act explicitly relating to extraterritorial operation of laws were covering cl 5 ("the laws of the Commonwealth shall be in force on all British ships, the Queen's ships of war excepted, whose first port of clearance and whose port of (Footnote continues on next page) distinctly expressed. It must be restricted to matters in which political influence may be exercised, or negotiation and intercourse conducted, between the Government of the Commonwealth and the Governments of countries outside the limits of the Commonwealth. This power may therefore be fairly the external interpreted as applicable representation of the Commonwealth by accredited agents where required; (2) the conduct of the business and promotion of the interests of the Commonwealth in outside countries; and (3) the extradition of fugitive offenders from outside countries." The volume of the "matters" to which Quick and Garran referred has perhaps turned out to be much greater than they would have envisaged at the time. This has come about as a result of the United Kingdom authorities, particularly at the Imperial Conferences of 1923 and 1926, ceasing to oppose full diplomatic representation and treaty making power for the Dominions. But it does seem that Quick and Garran did not see the words of s 51(xxix) as bearing a meaning consistent with the existence of a power to legislate with respect to things identified by reference to their location externally to Australia. The defendant contended that the views of Quick and Garran were not shared by other prominent writers at the time. It cited only an article by W Harrison Moore suggesting that the effect of s 51(xxix) was to prevent Commonwealth statutes from being "impugned on the ground that they reach beyond local affairs; in other words, the rule against laws 'intended to operate extraterritorially' will within the Commonwealth be a rule of construction only, and not a rule in restraint of power"241. That statement did not exhaustively define the content of "external affairs". It is difficult to enlist W Harrison Moore as a supporter of the geographic externality view when regard is had to what he said in 1910242: "[T]he 'external affairs' of the Commonwealth, like the foreign affairs of the Empire, are primarily matters of negotiation and administrative policy rather than of legislation. So far however as the conduct of external affairs may require the co-operation of the legislative power, the authority destination are in the Commonwealth") and s 51(x) ("fisheries in Australian waters beyond territorial limits"): at 354-355. 241 "The Commonwealth of Australia Bill", (1900) 16 Law Quarterly Review 35 at 39. 242 The Constitution of the Commonwealth of Australia, 2nd ed (1910) at 460-461 (emphasis added). Passages similar to the first two sentences quoted appeared in the first edition (1902) at 142-143. Nothing in either edition supports the geographic externality view. of the Parliament extends ... [I]n very many cases, legislation may be necessary to give effect to international obligations, or to assert international rights. So far as the exercise of such a power is consistent with the unity of the Empire, and the responsibility of the Imperial Government in respect to foreign affairs ... the Commonwealth Parliament would appear to have power to make provision." The mere fact that conduct takes place outside Australia does not create an international obligation or an international right. Soon after federation, O'Connor J, one of the most prominent framers of the Constitution, said243: "The control of trade and commerce with other countries, the imposition of Customs duties, immigration, quarantine, and external affairs, are all different aspects of Australia's relations with other countries." He also said that taken as a whole these powers "vest in the Commonwealth the power of controlling in every respect Australia's relations with the outside world"244. One lawyer whose early career was contemporary with federation – he was studying law when the Constitution was enacted – was Latham CJ. His language in R v Burgess; Ex parte Henry245 is significant. He could "draw no distinction" between the terms "external or foreign affairs or relations". He said: "The establishment of a political community the possibility, indeed the practical certainty in the world as it exists to-day, of the establishment of relations between that community and other political communities. Such relations are necessarily established by governments, which act for their people in relation to other peoples, rather than by legislatures which make laws for them." involves He called this a "fact of international intercourse". He said: 243 Attorney-General of NSW v Collector of Customs for NSW (1908) 5 CLR 818 at 842 (emphasis added). 244 (1908) 5 CLR 818 at 842 (emphasis added). 245 (1936) 55 CLR 608 at 643-645 (emphasis added). "The regulation of relations between Australia and other countries, including other countries within the Empire, is the substantial subject matter of external affairs." He also said: "The execution and maintenance of the Constitution, particularly when considered in relation to other countries, involves not only the defence of Australia in time of war but also the establishment of relations at any time with other countries, including the acquisition of rights and obligations upon the international plane." After discussing respectively s 61, s 51(xxix) and s 75(i) (conferring on this Court original jurisdiction in all matters "arising under any treaty") he said: "These provisions contemplate not the relations of the States of Australia with other countries but the relations of Australia, including all the States, with other countries." Another contemporary of federation was Starke J – then a barrister in possession of a good practice, and destined to appear in many constitutional cases early in the life of this Court. He asked246: "[W]hat else are external affairs of a State – or, to use the more common expression, the foreign affairs or foreign relations of a State – but matters which concern its relations and intercourse with other Powers or States and the consequent rights and obligations?" The adult life of Dixon J began after federation, but his legal education and early professional life commenced only a short time later. In his view, it was not to "be supposed [of s 51(xxix)] that its primary purpose was to regulate conduct occurring abroad. ... I think it is evident that its purpose was to authorize the Parliament to make laws governing the conduct of Australians in and perhaps out of the Commonwealth in reference to matters affecting the external relations of the Commonwealth."247 Evatt and McTiernan JJ were in the same position as Dixon J, although a little younger. It has been seen that they treated "external affairs" as dealing not only with the "relationship" between the Commonwealth and other parts of the 246 R v Burgess; Ex parte Henry (1936) 55 CLR 608 at 658 (emphasis added). 247 R v Burgess; Ex parte Henry (1936) 55 CLR 608 at 668-669 (emphasis added). British Empire, but also with the "relationship" between the Commonwealth and foreign States. They also said that the expression "external affairs"248: "is frequently used to denote the whole series of relationships which may exist between States in times of peace or war. It may also include measures designed to promote friendly relations with all or any of the nations." that These early statements about "external affairs", with their constant references the to "relationships" and "relations", do not suggest contemporaries of federation perceived "external affairs" as bearing a meaning giving power to enact in legislation the unilateral desires of the executive to control conduct taking place externally to Australia without any relation with another country or an international organisation being involved. The view, shared by every member of the Court in R v Burgess; Ex parte Henry, that the expression "external affairs" refers to relationships between Australia and other countries or international organisations, does not limit s 51(xxix) to the implementation of treaties. For example, legislation related to the preservation of friendly relations with other Dominions249 or other countries250 may be supported by s 51(xxix). However, the geographic externality view of s 51(xxix) goes beyond these criteria. Extradition at federation. Any contention that a contemporary of federation would understand "external affairs" to include the conduct of Australian residents in regions external to Australia, so that s 51(xxix) could support legislation rendering that conduct criminal even though it was not criminal by local law, would be contradicted by the contemporary understanding of extradition. The passage quoted from Quick and Garran above reveals that extradition was well to the forefront of their minds, at least. In a later passage they discussed the nature of extradition, its general dependence on treaties, and the consolidation of extradition law in the Extradition Act 1870 (Imp). They then "The Imperial Extradition Act (1870), 33 and 34 Vic c 52, consolidated the law then in force relating to the apprehension and 248 R v Burgess; Ex parte Henry (1936) 55 CLR 608 at 684 (emphasis added). 249 R v Sharkey (1949) 79 CLR 121. 250 Koowarta v Bjelke-Petersen (1982) 153 CLR 168 at 234 per Mason J. 251 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, surrender to foreign States of fugitive offenders. It provides that where an arrangement has been made by Her Majesty with any foreign State, respecting the surrender to such State of any fugitive criminals, Her Majesty may, by Order in Council, direct that the procedure and machinery of the Act should apply in the case of such foreign State: that Her Majesty may limit the operation of the Order to fugitive criminals in specified parts of Her dominions, and render it subject to such conditions, reservations, and exceptions as may be deemed expedient. The schedule to the Act contains a list of the crimes for which a suspected offender may be surrendered, subject to the restrictions that no fugitive shall be surrendered to a foreign State (1) for an offence of a political nature, or (2) unless provision is made by the law of that State that he shall not, when surrendered, be detained or tried in that State for any other offence committed prior to his surrender." They then explained how it would be possible, by reason of s 18 of the Extradition Act, for Commonwealth legislation to be enacted regulating "all negotiations and proceedings for the enforcement of extradition treaties entered into by Great Britain with foreign powers"252. In the course of the 19th century, certain key rules evolved from State practice in relation to extradition. Two of them were stated by Quick and Garran in the passage just quoted – the political offence doctrine and the speciality rule. A third was the double criminality rule. That rule required that the conduct constituting an extraditable offence should be punishable as a crime not only under the law of the requesting State but also under the law of the extraditing State. Thus the Extradition Act, s 9, prevented extradition unless the crime for which extradition was sought was an "extradition crime", namely a crime which, if committed within England or within English jurisdiction, would be one of the crimes described in the first schedule. That schedule listed numerous offences known to English law. Contemporaries of federation would have appreciated that the laws of the Australian jurisdictions, both before and after federation, often differed markedly from those of jurisdictions outside the Empire, and indeed from those of many jurisdictions within it. It is unlikely that contemporaries of federation would have perceived "external affairs" as used in s 51(xxix) as bearing a meaning sufficiently extensive to confer power to enact legislation rendering criminal conduct outside Australia which was not criminal by the law of the place where it occurred. A perception of that kind could not have stood with the contemporary 252 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, understanding of the double criminality rule as part of the law of extradition. In the light of that understanding, it would have been seen as futile for Australia to enact legislation of that kind if the person contravening it could not be prosecuted outside Australia and could not be extradited to Australia. Arguments for the geographic externality view Three broad lines of reasoning have been employed to support the geographic externality view. One turns on a textual analysis of the meaning of "external affairs" by inquiring what "affairs" means and what "external" means. The second rests on the absence of any territorial restriction in the opening words of s 51 of the Constitution. The third relies on the supposed existence of a "lacuna" in governmental power in Australia which would exist if the geographic externality view were wrong253. "External affairs" textually analysed The prevailing approach. Members of the Court in R v Burgess; Ex parte Henry propounded the view that "external affairs" refers to the relationships between Australia and other countries. That view prevents the expression from being dissected into two parts. This process of dissection, however, was the approach adopted in Polyukhovich v The Commonwealth (War Crimes Act Case) in which, for the first time, a clear majority of the Court decided, as distinct from saying, that the geographic externality view was correct: five Justices in an unqualified form and two Justices with a qualification. In that case, for example, 253 The defendant advanced a further argument. It said that to limit s 51(xxix) to legislation concerning relations with other nations would be limiting it to something which did not exist in 1901, hence making s 51(xxix) a purely anticipatory power, for it was not the Commonwealth but the Imperial Government which then conducted relations with other nations. The weakness of the argument was demonstrated in Victoria v The Commonwealth (Industrial Relations Act Case) (1996) 187 CLR 416 at 476-484 per Brennan CJ, Toohey, Gaudron, McHugh and Gummow JJ: the power to legislate with respect to external affairs included a power to implement treaties, whichever Government – British or Commonwealth – made those treaties, and the same must be true of dealings with other nations short of treaty making. 254 (1991) 172 CLR 501 at 599. Similar reasoning was employed at 632 by Dawson J, at 695-696 by Gaudron J and at 712-713 by McHugh J. The reasoning was first employed by Mason J in New South Wales v The Commonwealth ("the Seas and Submerged Lands Act Case") (1975) 135 CLR 337 at 470-471 and developed by him in Koowarta v Bjelke-Petersen (1982) 153 CLR 168 at 223. "The word 'external' means 'outside'. As a matter of language, it carries no implication beyond that of location. The word 'affairs' has a wide and indefinite meaning. It is appropriate to refer to relations, matters or things. Used without qualification or limitation, the phrase 'external affairs' is appropriate, in a constitutional grant of legislative power, to encompass both relationships and things: relationships with or between foreign States and foreign or international organizations or other entities; matters and things which are territorially external to Australia regardless of whether they have some identified connexion with Australia or whether they be the subject matter of international treaties, dealings, rights or obligations." The reasoning is – "affairs" are relations, matters or things; "external" means "territorially external to Australia"; therefore as long as a "matter" or "thing" is territorially external to Australia it is within the expression "external affairs"; and legislation may be enacted about it whether or not it relates to Australia's international relations with other countries or international organisations. The preferred approach. It is sometimes inappropriate to dissect a composite phrase into particular parts, give each part a meaning which that part has when used in isolation, and combine those meanings so as to give the composite phrase a meaning at odds with the meaning it has when construed as a composite phrase. "[It is a] fallacy ... to treat the words of an English sentence as building blocks whose meaning cannot be affected by the rest of the sentence ... This is not the way language works. The unit of communication by means of language is the sentence and not the parts of which it is composed. The significance of individual words is affected by other words and the syntax of the whole."255 Here, the better view is that "external affairs" in its context in s 51(xxix) is to be construed as a composite term and that the plural form of the noun has importance. Indeed, Deane J himself had earlier and rightly adopted this view in The Commonwealth v Tasmania (The Tasmanian Dam Case)256: 255 R v Brown [1996] AC 543 at 561 per Lord Hoffmann (Lord Browne-Wilkinson concurring), approved in Collector of Customs v Agfa-Gevaert Ltd (1996) 186 CLR 389 at 396-397 by Brennan CJ, Dawson, Toohey, Gaudron and McHugh JJ. 256 (1983) 158 CLR 1 at 253-254. "The phrase 'external affairs' is, like the phrase 'foreign affairs' and 'foreign relations', a composite one in which the noun exists in its plural form ... The use of the singular 'external affair' to refer to a particular matter or aspect of 'external affairs' is not only inapposite: it is liable to convey incorrect shades of meaning which will assume added significance if one proceeds to engage in the reverse process of defining the limits of the external affairs power by reference to whether a particular matter or object can or cannot properly be described as an 'external affair'." As noted above, Latham CJ could "draw no distinction" between the phrases "external or foreign affairs or relations"257, and Starke J appears to have been of the same opinion258. The meaning of "foreign affairs" is not usefully elicited by reasoning that an "affair" is anything and that "foreign" means anything that is situated outside a district. The expression "foreign affairs" means now what it meant in 1900: "international relations; activities of a nation arising from its dealings with other nations"259. And the expression "foreign relations" also means now what it meant in 1900: "the relationship between nations arising out of their dealings with each other" and "the field of foreign affairs"260. Contrary to what the defendant submitted, the expression "external affairs" has the same meaning. Once it is accepted, as this Court has, that the expression "external affairs" was selected to apply to relationships between Australia and places which were external to it, either because they were other parts of the British Empire or because they were foreign countries261, it becomes clear that not only is it wrong to analyse the meaning of the expression "foreign affairs" by looking at the meaning of each of the two words separately, but it is also wrong to adopt the same process for "external affairs". Criticisms of the prevailing approach. But even if it were right to analyse the expression "external affairs" by taking the meaning of each word in isolation, it does not follow that of the various meanings of "affairs", those which are least appropriate to the context should be selected to give a widening effect – 257 R v Burgess; Ex parte Henry (1936) 55 CLR 608 at 643. 258 R v Burgess; Ex parte Henry (1936) 55 CLR 608 at 658. 259 Macquarie Dictionary, Federation Edition (2001). 260 Macquarie Dictionary, Federation Edition (2001), meanings 1 and 2. 261 Victoria v The Commonwealth (Industrial Relations Act Case) (1996) 187 CLR 416 at 482 per Brennan CJ, Toohey, Gaudron, McHugh and Gummow JJ. "matters", "things" – while that which is most appropriate is given no more than a partial role – "relationships". Nor, if "external affairs" is to be the subject of analysis by looking at the meaning of each word separately, is it legitimate to reason, as a matter of language, that the word "external" carries, as Deane J said it carried, "no implication beyond that of location"262. No doubt many of the meanings of "external" do have an implication of "location". But several go beyond mere location. One meaning is "[c]onnected with, or having reference to, what is outside; having an outside object or sphere of operation"263. Another is "[h]aving reference to dealings with foreign countries"264. A like meaning is "relating to or concerned with what is outside or foreign: external commerce"265. Another like meaning is "coming from or relating to a country or institution other than the main subject: a department of external affairs"266. If the meaning of "external affairs" to modern Australians is crucial to the construction of s 51(xxix), many of them will remember that while Australia was slower than other Dominions to develop its own diplomatic service and its own independent foreign policy, when it began to do so in the 1930s, that development proceeded through the "Department of External Affairs" before it was renamed the "Department of Foreign Affairs", and this institution, under both names, was the means by which Australia conducted its relations with other nations, whether they were inside or outside the British Empire, and with international organisations. For these reasons, textual analysis points against the correctness of the geographic externality view of s 51(xxix)267. The geographic externality of legislative subject-matter may afford a reason why the legislation bears directly on Australia's relations with other countries, but it does not necessarily mean, as the defendant contended, that the legislation is legislation with respect to external 262 Polyukhovich v The Commonwealth (War Crimes Act Case) (1991) 172 CLR 501 263 Oxford English Dictionary, 2nd ed (1989), meaning 5a. 264 Oxford English Dictionary, 2nd ed (1989), meaning 5b. 265 Macquarie Dictionary, Federation Edition (2001), meaning 5. 266 Concise Oxford English Dictionary, 11th ed (2004). 267 The defendant supported the geographic externality view by pointing to the contrast between "external affairs" in s 51(xxix) and "the relations of the Commonwealth with the islands of the Pacific" in s 51(xxx). No member of this Court has relied on the contrast, and it is insufficient to defeat the conclusions which flow from the ordinary meaning of s 51(xxix). affairs. The grant of a legislative power may well need to be construed with all the generality which the words used admit268; but the words "external affairs" are insufficiently general to include the geographic externality view, and the principle just referred to does not permit the widening of the constitutional words beyond what their meaning will permit. Absence of territorial limitation on s 51 The second basis advanced for the geographic externality view of s 51(xxix) rests on the fact that the words "peace, order, and good government of the Commonwealth" at the start of s 51 of the Constitution have no territorial limitation. Thus in New South Wales v The Commonwealth ("the Seas and Submerged Lands Act Case")269 Jacobs J said that while a "State can only legislate in respect of persons acts matters and things which have a relevant territorial connexion with the State", s 51 imports no similar territorial limitation. The "Crown in the Australian Executive Council and in the Australian Parliament ... has that pre-eminence and excellence as a sovereign Crown which is possessed by the British Crown and Parliament". That position was attained, Jacobs J said, no later than the adoption by Australia in 1942 of the Statute of Westminster 1931 (Imp). "The words 'external affairs' can now be given an operation unaffected by any concept of territorial limitation." According to Mason CJ, who agreed with this reasoning in Polyukhovich v The Commonwealth270: "It follows that the legislative power of the Parliament with respect to matters external to Australia, using 'matters' in a comprehensive sense, is not less in scope than the power of the Parliament of the United Kingdom with respect to such matters." That reasoning supports the view that the "Crown in the Australian Executive Council" has power as extensive as the British Crown has (or at least had) in relation to dealings with the external world – a position which has 268 Grain Pool of Western Australia v The Commonwealth (2000) 202 CLR 479 at 492 [16] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ, quoting from R v Public Vehicles Licensing Appeal Tribunal (Tas); Ex parte Australian National Airways Pty Ltd (1964) 113 CLR 207 at 225-226 per Dixon CJ, Kitto, Taylor, Menzies, Windeyer and Owen JJ, which applied Jumbunna Coal Mine, No Liability v Victorian Coal Miners' Association (1908) 6 CLR 309 at 367-368 per O'Connor J. 269 (1975) 135 CLR 337 at 498. 270 (1991) 172 CLR 501 at 529-530. Others who have relied on this reasoning include, in that case, Dawson J at 633-634 and McHugh J at 713. arguably obtained at least since the Imperial Conference of 1926. The reasoning also supports the view that whichever power in s 51 is under consideration is not limited in its territorial operation beyond any limitation inherent in the particular terms of the placitum granting the power. That flows from s 2 of the Statute of Westminster 1931 (Imp), nullifying the operation of the Colonial Laws Validity Act 1865 (Imp) and doctrines of repugnancy, and s 3, giving the Commonwealth Parliament full powers to make laws having extraterritorial operation. But to say that the relevant power is not limited as to its territorial operation beyond any limitation flowing from its terms is not to say anything about whether there is, in fact, any territorial limitation flowing from its terms. Hence it does not follow that the subject-matter on which legislation can be enacted under s 51(xxix) is wider now than it was in 1901. And it does not follow that a "concept of territorial limitation" which existed in s 51(xxix) before the Crown in the Australian Parliament attained "that pre-eminence and excellence as a sovereign Crown which is possessed by the British Crown and Parliament" was removed when that event took place. For, as Jacobs J accepted, there is one difference even after that event: in Australia the Constitution applies. Thus Menzies J, speaking of pars (i) to (xxxix) of s 51, was correct to say: "The Statute of Westminster does not remove any restriction stated expressly in, or to be inferred from, the language of these paragraphs."271 Accordingly, the geographic externality view is not supported by recourse to the opening words of s 51 of the Constitution or the consequences of Australian independence. A lacuna in Australian governmental power A third, and related, argument for the geographic externality view is that if it were not correct, a lacuna might exist. Thus in Polyukhovich v The 271 R v Foster; Ex parte Eastern and Australian Steamship Co Ltd (1959) 103 CLR 272 (1991) 172 CLR 501 at 602-603. Dawson J reasoned similarly at 638. See also Mason CJ at 529-530, and see New South Wales v The Commonwealth ("the Seas and Submerged Lands Act Case") (1975) 135 CLR 337 at 498 per Jacobs J. Another way of putting this was employed by Murphy J in New South Wales v The Commonwealth ("the Seas and Submerged Lands Act Case") (1975) 135 CLR 337 at 503: if the geographic externality view were not correct, Australia would be an "international cripple unable to participate fully in the emerging world order". "... Commonwealth laws with respect to matters, things or persons outside Australia are likely to operate in areas where there will commonly be no competing State interests with the result that, in the absence of Commonwealth legislative power, there would be a lacuna in the plenitude of combined legislative powers of the various Parliaments of the Australian federation. It has long been recognized in this Court that, subject to express and implied constitutional limitations and guarantees, no such lacuna exists in legislative authority in relation to internal matters ... With the emergence of Australia as a fully sovereign and independent nation, there remains no acceptable basis for maintaining any such lacuna in the combined powers of the Parliaments of the federation to legislate for this country with respect to extraterritorial matters beyond that resulting from the limitations which the Constitution itself expressly or impliedly imposes." The argument that there is a lacuna is not an argument that there is a lacuna in the power of the Commonwealth under s 61 to deal with the external world. On the other hand, the capacity of the executive to deal with the external world under s 61 may be reduced if there is no corresponding legislative power to enact Australian laws which the dealings of the executive would make desirable. Underlying Deane J's reasoning is the assumption that at all costs the constitutional language must be construed so as to achieve the result most desired by the analyst. That assumption fails to recognise that the Constitution was a creation of a particular time and of particular circumstances by particular voters influenced by particular leaders to establish a particular form of federation. Its makers, both in Australia and in London, were hard-headed and unsentimental. Its form was moulded by pressures proceeding from conflicting interests. It is thus almost certain to contain what some observers, then and now, would regard as flaws. It is not a permissible approach to the Constitution to adopt strained constructions in order to avoid consequences which a particular analyst may dislike, such as a constitutional vacuum. Federation was a great achievement, but it was an achievement for which various prices had to be paid. It is possible that one of those prices is a limitation on the power of the Commonwealth to legislate extraterritorially which cannot be overcome efficiently by State legislative power or which, to an extent, cannot be overcome at all by the States. That possibility cannot be excluded merely because it is thought to be undesirable. Nature does not necessarily abhor a constitutional vacuum. Even if it did, velleity would not fill that vacuum. Is there in truth any relevant lacuna if the geographic externality view is wrong? In answering that question, it is necessary to bear in mind several considerations. First, even in the circumstances where s 51(xxix) does not give power to the Commonwealth to legislate extraterritorially, the Commonwealth may legislate extraterritorially in relation to matters over which it has some head of power other than s 51(xxix). Secondly, since 1986 it has been clear that State Parliaments have plenary power to enact laws having an extraterritorial operation: Australia Act 1986 (Cth), s 2(1); Australia Act 1986 (UK), s 2(1). There must be a relevant connection between the circumstances on which State legislation operates and the particular State, but it is clear that this requirement is liberally applied, and that even a remote and general connection between the subject-matter of the legislation and the State may suffice273. Thirdly, the apprehended lacuna would be narrowed further if uniform State legislation were enacted – if necessary, at the Commonwealth's suggestion. Finally, the power conferred on the Commonwealth by s 51(xxxviii) to exercise, at the request or with the concurrence of the States, "any power which [could] at the establishment of [the] Constitution be exercised only by the Parliament of the United Kingdom", is one that may be exercised by the making of laws within the Commonwealth which operate outside the Commonwealth. Thus it operates to "ensure that a plenitude of residual legislative power is vested in and exercisable in co-operation by the Parliaments of the Commonwealth and the States"274. It may be that even if the last two possibilities reduce the theoretical existence of a lacuna to vanishing point, the requisite political cooperation may not always be easily achievable. But, if the matter is sufficiently important to the well-being of the nation, one should not be too pessimistic about the possibility of achieving consensus275. The reference at the end of the passage quoted from Deane J's reasons for judgment in Polyukhovich v The Commonwealth to limitations on extraterritorial legislation which the Constitution imposes is crucial. The question is: "does s 51(xxix) give power to legislate extraterritorially merely because the matter to which the legislation relates is geographically external to Australia?" That in turn raises the question: "is there some limitation on extraterritorial legislation 273 Union Steamship Co of Australia Pty Ltd v King (1988) 166 CLR 1 at 14 per Mason CJ, Wilson, Brennan, Deane, Dawson, Toohey and Gaudron JJ. 274 Port MacDonnell Professional Fishermen's Association Inc v South Australia (1989) 168 CLR 340 at 381 per Mason CJ, Brennan, Deane, Dawson, Toohey, 275 The defendant submitted that as a matter of public international law, pursuant to the nationality principle, no-one disputes the right of a nation to subject its citizens abroad to the operation of its own penal laws. It is not, however, the concern of public international law to deal with whether, as a matter of the internal constitutional law of a federal nation, that right can be exercised by the central power or only by the component units. created by the express terms of s 51(xxix)?" If there is no such limitation, the emergence of Australia as a fully sovereign and independent nation does not make s 51(xxix) wider than it was before. If there is any such limitation, it is hard to see how that emergence abolished it: for to abolish it would be to amend the Constitution, and the Constitution can only be amended by recourse to s 128. Either way, the emergence relied on is immaterial. And even if s 51(xxix) on its true construction were to leave a lacuna because of theoretical or practical limits on State power, that consequence cannot legitimately be avoided by wishing for, or applying, another construction. Geographic externality view to be rejected in principle Independently of authority, the arguments advanced by the plaintiff are to be preferred. But the matter is not free from authority. The extent to which authority forms a barrier to their acceptance must now be examined. Authorities in favour of the geographic externality view New South Wales v The Commonwealth. The geographic externality view of s 51(xxix) first appeared in developed form in New South Wales v The Commonwealth in the judgments of Mason J and Jacobs J, and perhaps in that of Barwick CJ276. Whether Barwick CJ shared the geographic externality view depends on what he meant by "affair" when he said: "The power extends ... to any affair which in its nature is external to" Australia. A brief remark by Murphy J277 suggests that he shared this view, but his observations were undeveloped, and it is clear that his conclusion rested on the fact that the legislation under challenge effectively implemented the Convention on the Territorial Sea and the Contiguous Zone and the Convention on the Continental 276 (1975) 135 CLR 337 at 360 per Barwick CJ, 470-471 per Mason J and 497 per 277 (1975) 135 CLR 337 at 502-504. Shelf. In some measure the reasoning of Barwick CJ278 and Mason J279 also rested on Australia's adhesion to these Conventions. Contrary to what the headnote suggests, Jacobs J280 specifically denied that the legislation could be upheld by recourse to the Conventions. There is thus a controversy about whether the geographic externality view is a basis for the decision in New South Wales v The Commonwealth. Gaudron J281 and McHugh J282 thought it was not. Mason J thought it was283. Deane J thought it arguably was284. Gibbs CJ thought that no more than three Justices stated the geographic externality view, and then only as an alternative ground of decision285. The controversy turns partly on what Barwick CJ meant by "affair", partly on whether Murphy J's brief statement about the geographic externality view was a ground of decision, and partly on the extent to which the reasoning of those Justices finding support in the Conventions can be regarded as having put the geographic externality view as an independent ground of decision or merely as a dictum. In New South Wales v The Commonwealth286, Mason J contended that the geographic externality view accorded with what Evatt and McTiernan JJ said in R v Burgess; Ex parte Henry287. As counsel for the plaintiff submitted, it is difficult to see why. The contention must depend on the discussion by Evatt and 278 (1975) 135 CLR 337 at 361-366. 279 (1975) 135 CLR 337 at 472-476. 280 (1975) 135 CLR 337 at 496-497. 281 Polyukhovich v The Commonwealth (War Crimes Act Case) (1991) 172 CLR 501 282 Polyukhovich v The Commonwealth (War Crimes Act Case) (1991) 172 CLR 501 283 Koowarta v Bjelke-Petersen (1982) 153 CLR 168 at 223. 284 Polyukhovich v The Commonwealth (War Crimes Act Case) (1991) 172 CLR 501 at 600 and 602. 285 Koowarta v Bjelke-Petersen (1982) 153 CLR 168 at 190. 286 (1975) 135 CLR 337 at 471. 287 (1936) 55 CLR 608 at 678. McTiernan JJ of Evatt J's judgment in Jolley v Mainka288 and on their statement about the legislation for the Mandated Territory of New Guinea in that case: "[O]f necessity the legislation ... was in respect of matters geographically external to the Commonwealth."289 To select those words as supporting the geographic externality view is to ignore the central basis of Evatt J's reasoning in Jolley v Mainka. He saw the legislation as directed solely towards the performance of international obligations in relation to the former German colony owed to the League of Nations by Australia in its capacity as a signatory of the Treaty of Versailles and a mandatory of the League. Evatt J traced these obligations through Arts 118 and 119 of the Treaty of Versailles, Art 22 of the Covenant of the League of Nations, and the resolutions of the Council of the League made on 5 August 1920, 1 December 1920 and 17 December 1920. The last of these issued the relevant mandate to "His Britannic Majesty, to be exercised on his behalf by the Government of the Commonwealth of Australia"290. That this was the basis of Evatt J's reasoning in Jolley v Mainka was stressed by Evatt and McTiernan JJ in R v Burgess; Ex parte Henry291. The Developments before Polyukhovich v The Commonwealth. geographic externality view was next advanced in Robinson v Western Australian Museum292 and Viro v The Queen293. The passages are brief obiter dicta. There is nothing to show that any argument was presented on the point. The geographic externality view was repeated in Koowarta v Bjelke-Petersen294. The relevant statements were brief, but were part of passages upholding the 288 (1933) 49 CLR 242. 289 (1936) 55 CLR 608 at 678. 290 (1933) 49 CLR 242 at 270-273. 291 (1936) 55 CLR 608 at 678-679. 292 (1977) 138 CLR 283 at 294 per Barwick CJ, at 335 per Mason J and possibly at 293 (1978) 141 CLR 88 at 162 per Murphy J. 294 (1982) 153 CLR 168 at 223 per Mason J and 237 per Murphy J. In Polyukhovich v The Commonwealth (War Crimes Act Case) (1991) 172 CLR 501 at 528 Mason CJ said that Stephen J at 211 adhered to the geographic externality view and that Gibbs CJ in The Commonwealth v Tasmania (The Tasmanian Dam Case) (1983) 158 CLR 1 at 97 did so too. There, Gibbs CJ merely repeated what Stephen J had said. If Stephen J did state the geographic externality view, he did so in vague terms in a case not calling for a decision on the point. validity of the legislation in question as implementing a treaty. As noted above, it is questionable, however, whether it was right to say, as Mason J said, that in New South Wales v The Commonwealth295, "a majority of this Court decided that the power extends to matters and things, and ... persons, outside Australia"296. In The Commonwealth v Tasmania297 Murphy J repeated the geographic externality view, but in a judgment turning on the opinion that the legislation under challenge was valid as implementing a treaty. Polyukhovich v The Commonwealth and after. There is no doubt that the statements by the majority in Polyukhovich v The Commonwealth supporting the geographic externality view were necessary to the conclusion that s 9 of the War Crimes Act 1945 (Cth) was valid to the extent that it operated on conduct outside Australia298. The reasoning of Brennan J299 and Toohey J300, supporting a version of the geographic externality view which is qualified by the need for some Australian nexus, was necessary to their conclusion also. In Horta v The Commonwealth301 the Court upheld legislation relating to an area of the Continental Shelf independently of the fact that it implemented a treaty. The Court observed that whether or not the opinion of Brennan J and required some connection between affairs geographically external to Australia and Australia was correct, the requirement for which it called was, in any event, satisfied302. that s 51(xxix) In Victoria v The Commonwealth303 Brennan CJ, Toohey, Gaudron, McHugh and Gummow JJ said that the unqualified geographic externality view 295 (1975) 135 CLR 337. 296 Koowarta v Bjelke-Petersen (1982) 153 CLR 168 at 223. 297 (1983) 158 CLR 1 at 171-172. 298 (1991) 172 CLR 501 at 528-529 per Mason CJ, 602-603 per Deane J, 632 per Dawson J, 695-696 per Gaudron J and 712-713 per McHugh J. 299 (1991) 172 CLR 501 at 550-551. 300 (1991) 172 CLR 501 at 654. 301 (1994) 181 CLR 183. 302 (1994) 181 CLR 183 at 193-194. 303 (1996) 187 CLR 416 at 485. on which the reasoning of the majority relied in Polyukhovich v The Commonwealth must now be taken as expressing the view of the Court. That was a significant pronouncement. At the time its significance lay in the fact that Brennan CJ and Toohey J, who had not adhered to the unqualified geographic externality view in Polyukhovich v The Commonwealth, now expressed adherence to it. It later became more significant when that pronouncement was referred to with approval by a majority of the Court in passages necessary for its decision in De L v Director-General, NSW Department of Community Services304. The actual result in Victoria v The Commonwealth, however, turned on the treaty implementation aspect of s 51(xxix). In De L v Director-General, NSW Department of Community Services305 it was said that the Family Law (Child Abduction Convention) Regulations 1986 (Cth), dealing with the return of children abducted from Australia and the return of children abducted to Australia, were valid under s 51(xxix) independently of whether they implemented an international Convention to which Australia was party. It was said that movements of children between Australia and places physically external to Australia were "external affairs". These statements were necessary steps in the Court's reasoning. Horta v The Commonwealth was followed in R v Hughes306, but the geographic externality view was not a necessary step towards the conclusion that the relevant legislation was valid in that case, since the Court found its validity to be supported by s 51(i). The defendant relied on the following statement of Callinan J307 in Shaw v Minister for Immigration and Multicultural Affairs: "'External affairs' is a simple and clear expression. It is concerned with events, places and people external to Australia and their relation to Australia." When that statement is read in context, it does not support the defendant's arguments. There are two dicta upholding the geographic externality view in Re Aird; Ex parte Alpert308 but they did no more 304 (1996) 187 CLR 640 at 650 per Brennan CJ, Dawson, Toohey, Gaudron, McHugh 305 (1996) 187 CLR 640 at 650 per Brennan CJ, Dawson, Toohey, Gaudron, McHugh 306 (2000) 202 CLR 535 at 556 [42] per Gleeson CJ, Gaudron, McHugh, Gummow, 307 (2003) 218 CLR 28 at 85 [182] (emphasis added). 308 (2004) 220 CLR 308 at 317 [27] per McHugh J and 334 [82] per Kirby J. than cite Polyukhovich v The Commonwealth. Another statement in Re Aird; Ex parte Alpert309 that the legislation in issue in the present case is valid was a dictum only, and of a very tentative kind. There is also a statement in the same case that legislation making all crimes committed by Australian nationals abroad triable and punishable in Australia could be supported by the external affairs power310. That was a dictum as well. The five statements referred to in this paragraph were each uttered in a case in which no argument of the kind advanced to the Court in this case was offered. Indeed the respondent in Re Aird; Ex parte Alpert expressly disavowed reliance on the external affairs power. This survey suggests that although the geographic externality view has attracted considerable support within the Court since 1975, it formed the ratio in Polyukhovich v The Commonwealth, Horta v The decidendi only Commonwealth and De L v Director-General, NSW Department of Community Services. In view of the division of opinion on this point in relation to New South Wales v The Commonwealth, it cannot be said that the geographic externality view clearly forms part of the ratio decidendi of that case. The three relevant decisions were decided within a five year period. They are relatively recent. Polyukhovich v The Commonwealth was fully argued by counsel and the opinions of the Justices were fully reasoned. It stands in contrast with the later two cases. In neither of them was any application made for leave to reargue the correctness of Polyukhovich v The Commonwealth. In the former the Court held without elaboration that on any of the views stated in Polyukhovich v The Commonwealth the legislation was valid. In the latter it simply applied the majority view in Polyukhovich v The Commonwealth (which the majority in Victoria v The Commonwealth311 had said "must now be taken as representing the view of the Court"). Inconvenience and injustice. These three cases have not become so woven into the fabric of the law as to be irremovable without causing serious damage. The defendant argued, in answer to the plaintiff's contention that the cases resting on the geographic externality view should be overruled, that this view had produced results which were neither inconvenient nor unjust. This, it was said, was demonstrated by a "range of Commonwealth legislation that potentially relies on the principle". Thirteen enactments were referred to. It was submitted, without detailed examination of the enactments, that while some of 309 (2004) 220 CLR 308 at 313 [7] per Gleeson CJ. ("That legislation was presumably enacted under the external affairs power".) 310 (2004) 220 CLR 308 at 361 [168] per Callinan and Heydon JJ. 311 (1996) 187 CLR 416 at 485. these gave effect to international obligations, in all of them Parliament had relied on the geographic externality view, and in some Parliament had given the legislation an extraterritorial effect where the "relevant convention may not expressly impose such an obligation". The defendant did not, however, unequivocally submit that any of this legislation was supported only by the geographic externality view of s 51(xxix). In view of the speculative and tentative character of the submissions, and the undesirability of determining the constitutional validity of legislation where that is not in issue and has not been the subject of any specific argument by the parties, it is undesirable to examine in detail each piece of legislation referred to. There is no doubt that the geographic externality view is useful for the Commonwealth, but questions of inconvenience, even grave inconvenience, have little weight on issues of constitutional interpretation312. Further, no doubt the geographic externality view will often not operate unjustly, although it arguably does where the action prohibited by Australian legislation is not contrary to the law of the place in which the action occurs. What is significant, however, is that the defendant did not contend that its rejection would cause the collapse of significant legislative schemes, or would, by reason of its having been relied on in some other way, cause inconvenience or injustice beyond that which might flow from the existence of any lacuna which that would leave. But, in any event, even if inconvenience or injustice were the yardstick, a case brought under the legislation challenged here could itself produce inconvenience. Assume that an Australian national conducts himself in a foreign country in a way which is not criminal by the law of that foreign country but which would be criminal under the challenged legislation. Assume that he is charged in Australia but returns to the foreign country. Assume that the extradition law of that country adopts the double criminality doctrine. The double criminality doctrine would prevent the Australian national being extradited to Australia. Overruling. In The Commonwealth v Hospital Contribution Fund Gibbs CJ acknowledged that the Court has power to reconsider past authority but also held that such power was to be exercised "with restraint"313. Gibbs CJ then pointed to various matters relevant, in that case, to the reversal of earlier authority. Three of them were that the past decisions did not rest on a principle 312 See, for example, Ha v New South Wales (1997) 189 CLR 465 at 503 per Brennan CJ, McHugh, Gummow and Kirby JJ. 313 (1982) 150 CLR 49 at 56. that had been carefully reasoned through a series of cases314, that the past authorities led to "no useful result, but [rather] considerable inconvenience"315 and that the past decisions had not been acted upon by legislatures in a manner which would lead to adverse consequences if they were overruled316. Callinan J, in Esso Australia Resources Ltd v Federal Commissioner of Taxation317, was of the view that these matters were not to be applied in a mechanistic way and raised further questions relevant to a reconsideration of past authority. One was "whether the decision of a bench which itself may have overturned what had for a long time been regarded as settled legal orthodoxy should have a monopoly on the thinking on the topic in question for all time". The statements of Gibbs CJ and Callinan J suggest that the authorities under challenge should be overruled. A wholesale overruling will not be necessary, however. In this case the defendant concurred with the plaintiff's proposition that the results in Polyukhovich v The Commonwealth and Horta v The Commonwealth could be justified on other grounds. To state this proposition is not to deny that, if not overruled, the cases stand as authority for the reasoning they employed318; but the proposition does diminish any inconvenience that might be thought to flow from those cases being overruled on this point. The geographic externality view should be rejected. To the extent that it was a necessary step in the reasoning of three cases, they should be overruled. Are ss 50BA and 50BC laws that, since they operate on conduct geographically external to Australia, necessarily affect Australia's external relations? The defendant's argument was that since the legislation operated on a matter external to Australia, it had an "inevitable" effect on Australia's external relations. This does not follow. It might have such an effect; it might not. The effect is not established merely by pointing to the fact that the legislation operates on conduct geographically external to Australia. 314 (1982) 150 CLR 49 at 56. 315 (1982) 150 CLR 49 at 57. 316 (1982) 150 CLR 49 at 58. 317 (1999) 201 CLR 49 at 104-105 [164]. 318 See Victoria v The Commonwealth (Industrial Relations Act Case) (1996) 187 CLR 416 at 484 per Brennan CJ, Toohey, Gaudron, McHugh and Gummow JJ. Do ss 50BA and 50BC concern Australia's external relations? The defendant's argument was that the prohibition of child sexual exploitation by Australian residents and citizens abroad concerned, affected and was designed to protect Australia's relations with other countries. It relied on statements in the Second Reading Speech delivered by the Minister for Justice, Mr Duncan Kerr, on introducing the Crimes (Child Sex Tourism) Amendment Bill 1994, containing the clauses which became ss 50BA and 50BC. He said that a minority of Australian citizens and residents were now known internationally as major offenders in several Asian countries; that Australia was "gaining an unenviable reputation in the world press" in relation to child sex tourism; and that the Asian countries which are chiefly affected "welcome any assistance ... that other governments can give"319. The House of Representatives Standing Committee on Legal and Constitutional Affairs said that the sexual abuse of children by Australian men in Asia "brings Australia into disrepute and ought not to be tolerated by Australians at home"320. There are the following difficulties with these submissions. The statements relied on do not actually say that the conduct targeted by the legislation has worsened Australia's relations with other nations, or that enactment of the legislation would improve them. Even if they did, it is questionable whether assertions by members of the executive or by parliamentary committees (as distinct from the public and solemn acts of the executive in entering a treaty and of the legislature in implementing it321) can establish a factual condition precedent to a constitutional power to legislate. To accept that they do would give the executive the power not only to enable the Commonwealth legislature to legislate on anything (whether inside or outside Australia) which may affect Australia's relations with other nations, and thereby radically alter the distribution of powers for which the Constitution provides322 – 319 Australia, House of Representatives, Parliamentary Debates (Hansard), 3 May 1994 at 73. He also, unlike the defendant in this case, relied on "international obligations to protect children", citing Australia's ratification of the Convention on the Rights of the Child on 17 December 1990. 320 Report on the Crimes (Child Sex Tourism) Amendment Bill 1994, (1994), par 2.3.9. 321 The Commonwealth v Tasmania (The Tasmanian Dam Case) (1983) 158 CLR 1 at 322 This is not a problem in relation to legislation, like that involved here, which is purely extraterritorial. It could be a problem where the legislation is not purely extraterritorial. a course which the cases on treaty implementation323 permit, subject to safeguards324 – but also to do so on the strength of the "bare ipse dixit"325 of an executive officer or member of Parliament without equivalent safeguards. The latter step is very different from the former. A further consideration relates to extradition. Extradition is a voluntary act of a sovereign power usually carried out pursuant to a treaty in the interests of comity between nations. For Australia to criminalise conduct in a foreign country, the law of which does not prohibit it, as has been seen, tends to futility by reason of the double criminality rule. It does not fit coherently with extradition law and custom. In addition, it might also affect the relations of Australia with other nations adversely, because, unless it results from a treaty with those nations and extradition arrangements are in place, it could be seen as an attempted intrusion, however ineffectual, into the affairs of those other nations. The defendant also pointed to two memoranda of understanding entered by Australia, one with the Philippines and the other with Fiji, for joint action to combat child sexual abuse. These, however, post-dated the introduction of ss 50BA and 50BC, and the operation of those provisions in any event is not limited to the territory of those nations or indeed of any other nations that may have requested Australia's assistance in combating child sexual abuse. Finally, the defendant's submission does not explain how it is to be reconciled with the fact that the operation of ss 50BA and 50BC may adversely affect Australia's relations with countries having a lower age of consent than the age of 16 referred to in ss 50BA and 50BC. A national of one of those countries who is a resident of Australia could be convicted under ss 50BA and 50BC for acts in his or her country of nationality even though those acts were lawful under the law of that country. 323 Koowarta v Bjelke-Petersen (1982) 153 CLR 168; The Commonwealth v Tasmania (The Tasmanian Dam Case) (1983) 158 CLR 1. 324 The law could not discriminate against a State or prevent it from continuing to exist and function; there must be a Convention; the Convention must be "bona fide"; and the law must be reasonably and appropriately adapted to give it effect. 325 The phrase is Lord President Cooper's in Davie v Magistrates of Edinburgh 1953 SC 34 at 40. Are ss 50BA and 50BC laws with respect to external affairs on the basis that the extraterritorial prohibition of the sexual exploitation of children is a matter of international concern? The defendant's arguments. The defendant argued that laws on matters of international concern were supported by s 51(xxix). Below, this will be called the "international concern doctrine" for short326. The defendant argued that the sexual exploitation of children, and its extraterritorial prohibition, were matters of international concern. The defendant said there were 34 countries which had legislation similar to ss 50BA and 50BC – about a sixth of the nations of the world; but the Court was told nothing of the legislative position in the other five-sixths of those nations. The defendant also relied on the Convention on the Rights of the Child adopted by the General Assembly of the United Nations on 20 November 1989; the Optional Protocol to that Convention on the Sale of Children, Child Prostitution and Child Pornography adopted by the General Assembly of the United Nations on 25 May 2000; declarations adopted at various World Congresses (including two World Congresses Against Commercial Sexual Exploitation of Children); and various resolutions of the United Nations Commission on Human Rights and the United Nations General Assembly. While the Convention on the Rights of the Child entered into force generally on 2 September 1990, was ratified by Australia on 17 December 1990, and entered into force for Australia on 16 January 1991, the Optional Protocol to that Convention on the Sale of Children, Child Prostitution and Child Pornography was not in force when ss 50BA and 50BC came into force. That Optional Protocol was adopted on 25 May 2000 and entered into force generally on 12 February 2002. Australia has signed it, but not ratified it; hence it is not a party to it. Further, the two World Congresses and many of the resolutions of the United Nations Commission on Human Rights and the United Nations General Assembly came into being after the challenged legislation came into force. 326 It should be emphasised that the question whether the sexual exploitation of children, and its extraterritorial prohibition, is a "matter of international concern" within the legal context of the international concern doctrine and Australian constitutional law, which was controversial in this case, is entirely distinct from the question of whether the sexual exploitation of children is a "matter of international concern" in a more general sense which, of course, it is – it troubles many people around the world. If it be assumed that this material demonstrates that in some sense the sexual exploitation of children is a matter of international concern, the question arises whether the international concern doctrine exists – the view that the Commonwealth has power by virtue of s 51(xxix) to legislate on a matter of international concern. The authorities. There is no case in this Court deciding that the international concern doctrine exists. There are dicta which support the view, or which some contend support the view, that it does327. But there is less to these 327 R v Burgess; Ex parte Henry (1936) 55 CLR 608 at 687 per Evatt and McTiernan JJ ("the Parliament may well be deemed competent to legislate for the carrying out of 'recommendations' as well as the 'draft international conventions' resolved upon by the International Labour Organization or of other international recommendations or requests upon other subject matters of concern to Australia as a member of the family of nations" – a dictum limited in several respects); Koowarta v Bjelke-Petersen (1982) 153 CLR 168 at 217 per Stephen J ("A subject- matter of international concern necessarily possesses the capacity to affect a country's relations with other nations and this quality is itself enough to make a subject-matter a part of a nation's 'external affairs'"), at 234 per Mason J ("a matter which is of external concern to Australia having become the topic of international debate, discussion and negotiation constitutes an external affair before Australia enters into a treaty relating to it") and at 242 per Murphy J ("matters of international concern" said to be "the observance in Australia of international standards of human rights"); The Commonwealth v Tasmania (The Tasmanian Dam Case) (1983) 158 CLR 1 at 131 per Mason J, at 171 per Murphy J ("it is not necessary that the subject be one of concern demonstrated by the other nation States generally. For example, concern expressed by the world's scientific community or a significant part of it over action or inaction in Australia might be enough to bring a matter within Australian external affairs") and at 258-259 per Deane J (quoting Evatt and McTiernan JJ); Polyukhovich v The Commonwealth (War Crimes Act Case) (1991) 172 CLR 501 at 560-561 per Brennan J, 604-605 per Deane J and 657 per Toohey J. In Richardson v Forestry Commission (1988) 164 CLR 261 at 322 Dawson J said a majority in The Commonwealth v Tasmania (The Tasmanian Dam Case) (1983) 158 CLR 1 supported "sufficient international concern" as a basis for attracting power under s 51(xxix); whether or not they did (his assertion that Brennan J did at 222 may be doubted and a key part of the passage in Mason J's opinion at 129-132 he relies on has been called "somewhat ambiguous": Zines, The High Court and the Constitution, 4th ed (1997) at 294), he proceeded Polyukhovich v The Commonwealth (War Crimes Act Case) (1991) 172 CLR 501 at 604-605 Deane J suggested that several Justices in Richardson v Forestry Commission supported "sufficient international concern" but it is hard to see that any did apart from Dawson J in the special sense just mentioned. the proposition with considerable coolness. to discuss dicta than meets the eye. Some of them do not in fact support the international concern doctrine as a means of widening s 51(xxix); rather, for example, they discuss whether it narrows s 51(xxix) in its treaty implementation aspect. It is curious that a doctrine potentially narrowing s 51(xxix) so far as it depends on treaties is said to widen s 51(xxix) where no treaty can be relied on. All the dicta, so far as they were approving, were unnecessary for the actual outcome of the particular reasoning in which they appeared. They tended to be passing remarks made in the course of enunciating some more final conclusion, but not all of them were directed to the international concern doctrine itself. Assuming that a matter of "international concern" can be interpreted and defined, the outer limits of and the difficulties in applying such a doctrine do not, with respect, appear to have been tested in the authorities. In addition to the dicta just discussed, there is also an actual decision of a single judge of the Federal Court of Australia applying the international concern doctrine328. In that case it was twice seen as important to state that the legislation related to matters of international concern both when it was enacted and when it was contravened329. These statements reflect the possibility that at different times a matter may not be of international concern, may then become of international concern, and may then cease to be of international concern again330. But if validity is to depend on the position not only at the time of enactment but also at the time of contravention, the outcome will be that legislation which was once invalid can later become valid, and legislation which was valid when enacted can become invalid. This volatility, and the elusiveness331 connected with attempts to define "international concern", strongly suggest that the international concern doctrine does not exist; for if it did, it would operate antithetically to the rule of law. To those attempts it is now necessary to turn. What is a matter of international concern? The defendant endeavoured in various ways to overcome the criticism that the international concern doctrine is too vague to be employed as a basis on which to support legislation under s 51(xxix). The defendant submitted that it sufficed if the concern were 328 Souliotopoulos v La Trobe University Liberal Club (2002) 120 FCR 584 at 598- 600 [51]-[57] per Merkel J. 329 Souliotopoulos v La Trobe University Liberal Club (2002) 120 FCR 584 at 598 [51] and 599 [53]. 330 See Polyukhovich v The Commonwealth (War Crimes Act Case) (1991) 172 CLR 501 at 562 per Brennan J. 331 The criticism is Mason J's: The Commonwealth v Tasmania (The Tasmanian Dam Case) (1983) 158 CLR 1 at 123. expressed in resolutions passed at international meetings attended by the representatives of governments (as distinct from private interests). But many things are discussed at international meetings and many resolutions passed about them: are they all of international concern332? The defendant submitted that one could list "a fairly small number of" matters which, though their boundaries were admittedly fuzzy, were clearly of international concern – global warming, genocide, race relations, torture, terrorism, space exploration, air safety, marine safety and exploitation of children. It suggested that smoking cigarettes and drinking alcohol were not of international concern, unless some United Nations conference called for a prohibition on use of these substances. The submission did not, however, explain what the distinction was between these subjects and the many other subjects discussed at international conferences. The defendant could not explain how many nations, or which classes and numbers of persons within nations, must share a concern before a matter becomes one of "international concern". And it did not explain what evidence might demonstrate international concern. At least outside the field of constitutional law, the courts have taken judicial notice of governmental matters such as the existence of a state of war and the recognition of a foreign State by reliance on a certificate from the executive. The question of whether this should be done where the facts are disputed constitutional facts has been left open333. On the other hand, it has been said that the fact of entry into, and of ratification of, an international Convention evidences the judgment of the executive and of Parliament that the subject-matter of the Convention is of international character; and further that whether the subject-matter of a Convention is of international concern is not a question "on which the Court can readily arrive at an informed opinion" but rather one which involves "nice questions of sensitive judgment which should be left to the executive government for determination"334. Whether a subject-matter not dealt with by a Convention is of international concern involves equally difficult questions. But if international concern is to be demonstrated otherwise than by public and solemn acts like treaties, what other material, proved by what means, can be considered? The opinions of national governments, and the opinions of particular segments of their populations, can differ across the world: the defendant did not explain how conflicting "international concerns" are to be 332 This difficulty troubled Brennan J in Polyukhovich v The Commonwealth (War Crimes Act Case) (1991) 172 CLR 501 at 561-562. 333 Attorney-General (Cth) v Tse Chu-Fai (1998) 193 CLR 128 at 149 [54] per Gaudron, McHugh, Gummow, Kirby, Hayne and Callinan JJ. 334 The Commonwealth v Tasmania (The Tasmanian Dam Case) (1983) 158 CLR 1 at taken into account in evaluating the existence of Commonwealth legislative power under s 51(xxix)335. The difficulty of identifying "matters of international concern" is connected, then, with a difficulty in measuring the extent of the international concern. Which countries share the concern and which do not? Can the concern be said to exist, or to be international, if no treaty has been entered? No doubt many people in many different countries share concerns, but it has not been demonstrated that, in the absence of formal arrangements about them to which Australia is a party, those matters could possibly be regarded as external affairs within the placitum336. What limits are there to the Commonwealth's power to legislate? Further, assuming a matter of "international concern" could be identified, the defendant did not explain what boundaries there are to the Commonwealth's power to legislate in relation to it. Will the Commonwealth have plenary power under s 51(xxix) to legislate on a subject of "international concern"? If so, the external affairs power would be a power of very broad scope and would be capable of unduly disrupting the distribution of powers between the States and the Commonwealth – an outcome which the Court, in developing the application of s 51(xxix) so far as treaty implementation is concerned, has endeavoured to minimise337. the Commonwealth plenary power, how is the power to be limited? Would the power of the Commonwealth be limited to legislation that is "capable of being reasonably considered to be 'appropriate and adapted'" to addressing the concern338? That test, employed in applying s 51(xxix) in relation to implementing treaties339, seems very hard to apply to matters of international international concern doctrine does not give the 335 Some of the materials on which the defendant relied revealed that Australian lawyers had expressed hostility to the enactment of the impugned legislation by reason of its potentially unfair effects on accused persons. 336 It will be remembered that although the defendant pointed to the Convention on the Rights of the Child to show that the sexual exploitation of children was a matter of international concern, it did not seek to uphold the challenged legislation as giving effect to that Convention. 337 See above at [209], notes 324 and 325. 338 As Deane J suggested in Polyukhovich v The Commonwealth (War Crimes Act Case) (1991) 172 CLR 501 at 604-605. 339 Victoria v The Commonwealth (Industrial Relations Act Case) (1996) 187 CLR 416 at 487 per Brennan CJ, Toohey, Gaudron, McHugh and Gummow JJ. concern: for treaties, indeterminate though the language of some of them is, are normally incomparably more detailed and specific than "matters of international concern". Novelty of the doctrine. If s 51(xxix) could support legislation on matters of "international concern" it would be a means of upholding the legislation struck down in Australian Communist Party v The Commonwealth340. If anything could be described as being a matter of international concern, it was Communism in the 1950s. Yet it did not occur to any of the Justices or any of the many counsel during the lengthy arguments in that hard-fought case that the legislation banning the Australian Communist Party could be validated because it related to a matter of international concern. That is not logically fatal to the defendant's argument, but it weakens its credibility. The international concern doctrine is negated by another aspect of Australian Communist Party v The Commonwealth. It has been said that whether a subject-matter is of international concern is not a question on which the Court can "substitute its judgment for that of the executive government and Parliament"341. This was said in relation to the treaty aspect of s 51(xxix). If this statement is to be taken as part of the international concern doctrine, it is analogous to Latham CJ's approach to the defence power in Australian Communist Party v The Commonwealth342: "The decisions to fight Germany and Japan were not made by the Court. The Court was not asked, and did not presume, to hold laws valid or invalid on the ground that the war was or was not really a war for the defence of Australia. The laws were held valid not because the Court agreed with the policy of the Government and Parliament in regarding Germany and Japan as enemies, but because the legislation was held to have a real connection with the war against Germany and Japan. In other words, the action of the Government in declaring war and of Parliament in adopting that decision and legislating in pursuance of it itself created a defence situation which provided a basis for the legislation." From this Latham CJ concluded that it was not open to the courts to challenge the truth of recitals in the impugned legislation averring that the activities of the Australian Communist Party made it necessary, for the security and defence of 340 (1951) 83 CLR 1. 341 The Commonwealth v Tasmania (The Tasmanian Dam Case) (1983) 158 CLR 1 at 342 (1951) 83 CLR 1 at 151-152 (original emphasis). Australia, to dissolve it. This conclusion was not accepted by the majority343. Indeed, it went beyond the defendants' argument in that case which treated the preamble as conclusive not of the facts recited but only of the existence of the legislative opinions disclosed344. The similarity between Latham CJ's conclusion and the international concern doctrine in this respect casts grave doubt on the latter. Divisions about the doctrine. The international concern doctrine has never been decisive in this Court. Its life has been quite short. But it has caused sharp divisions within the Court already. Thus in The Commonwealth v Tasmania345 Mason J said of a law being sustained as implementing a treaty under s 51(xxix): "The law must conform to the treaty and carry its provisions into effect. The fact that the power may extend to the subject-matter of the treaty before it is made or adopted by Australia, because the subject-matter has become a matter of international concern to Australia, does not mean that Parliament may depart from the provisions of the treaty after it has been entered into by Australia and enact legislation which goes beyond the treaty or is inconsistent with it." Of this Dawson J said in Richardson v Forestry Commission346: "I cannot see why, if it is international concern which gives a subject- matter the character to bring it within the description of external affairs, the conclusion of a limited treaty upon that subject-matter should place outside the external affairs power that part of the subject-matter which is beyond the limits of the treaty. Nor can I see why legislation passed with respect to a matter of international concern should no longer be legislation with respect to external affairs simply because Australia becomes a party to a treaty upon a more limited basis than is reflected by the legislation." One solution to these problems would be to reject the existence of "international concern" not reflected in treaties as a basis for s 51(xxix) validity. Indeed, Mason J was concerned to negate the possibility that s 51(xxix) gave no legislative power to implement a treaty unless it was shown, independently of the 343 See, for example, Dixon J at 200-201. 344 See Dixon J at 191. 345 (1983) 158 CLR 1 at 131-132. 346 (1988) 164 CLR 261 at 325. decisions of the executive to enter it and the legislature to implement it, to be of international concern; he did not appear to be endeavouring to advocate s 51(xxix) as giving a power to legislate on any matter of international concern347. There are immense difficulties facing any court wishing to recognise, as a matter of decision, the international concern doctrine. The arguments advanced in this case have not resolved those difficulties. In these circumstances it would not be right to uphold the legislation impugned in this case by reliance on the doctrine. Inapplicability of the doctrine to the present legislation. Even if there are relevant matters of international concern, and even if the international concern doctrine is sound, that doctrine could not support ss 50BA and 50BC. The material relied on by the defendant reveals concern – let it be assumed to be "international" – about the sale of children, child prostitution and child pornography. Sections 50BA and 50BC do not criminalise that conduct, they criminalise different conduct. The material also reveals general concern about sexual activity involving children under 12 – not under 16, because some of the legislation relied on by the defendant for another purpose reveals that in some countries, no matter how many Australians might deprecate it, activity with children as young as 12 is lawful, and in others with children as young as 14 or 15. If the material demonstrates a general concern about children under 12, the legislation, in criminalising conduct with older children, goes beyond the area of international concern. Questions reserved At the conclusion of the hearing the Court answered the reserved questions in favour of the defendant. For the reasons we have stated, we did not join in those orders. Instead, we favour the following answers to the questions reserved for the consideration of the Full Court: 347 The Commonwealth v Tasmania (The Tasmanian Dam Case) (1983) 158 CLR 1 at The defendant.

HIGH COURT OF AUSTRALIA MAHRAN BEHROOZ APPELLANT AND SECRETARY OF THE DEPARTMENT OF IMMIGRATION AND MULTICULTURAL AND INDIGENOUS AFFAIRS & ORS RESPONDENTS Behrooz v Secretary of the Department of Immigration and Multicultural and Indigenous Affairs [2004] HCA 36 6 August 2004 ORDER Appeal dismissed. Appellant to pay costs of first respondent. On appeal from the Supreme Court of South Australia Representation: J W K Burnside QC with J P Manetta for the appellant (instructed by Jeremy Moore & Associates) D M J Bennett QC, Solicitor-General of the Commonwealth, with M A Perry for the first and second respondents (instructed by Australian Government Solicitor) No appearance for the third and fourth respondents Intervener D S Mortimer SC with J K Kirk intervening on behalf of the Human Rights and Equal Opportunity Commission (instructed by the Human Rights and Equal Opportunity Commission) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Behrooz v Secretary of the Department of Immigration and Multicultural and Indigenous Affairs Immigration – Appellant charged with offence of escape by unlawful non-citizen from immigration detention contrary to s 197A of the Migration Act 1958 (Cth) – Appellant sought issue of witness summonses pursuant to Magistrates Court Act 1991 (SA) seeking production of documentary material relating to conditions and complaints about conditions at detention centre – Whether material sought by witness summonses could have assisted appellant in his defence – Whether, by reason of conditions at detention centre, it could be said that appellant did not escape from "immigration detention" within the meaning of the offence. Immigration – Constitutional law (Cth) – Whether detention under harsh or inhumane conditions is authorised by the Migration Act 1958 (Cth) – Whether Migration Act 1958 (Cth) only authorises detention under conditions that are reasonably capable of being seen as necessary for migration control purposes – Whether detention in harsher conditions would be punitive and therefore could not validly be authorised except as a consequence of the exercise of the judicial power under Ch III of the Constitution – Distinction between lawful authority to detain and means by which detention is achieved and enforced – Relevance of potential availability of other civil, criminal or administrative remedies to the construction of the statutory offence – Relevance of Constitutional principles and international law to construction of statutory offence. Constitutional law (Cth) – Construction of the Constitution – Whether international law applicable to interpretation of the Constitution. Words and phrases – "detain", "detainee", "immigration detention". Constitution, Ch III. Migration Act 1958 (Cth), ss 3A, 5, 189, 196, 197A, 273. Magistrates Court Act 1991 (SA), s 20. GLEESON CJ. The question in this appeal concerns the relevance, to a charge of escaping from immigration detention contrary to s 197A of the Migration Act 1958 (Cth) ("the Act"), of information about the general conditions at the place of detention from which the alleged offender escaped. This is an issue of law, and was argued as such by the parties to the appeal. It comes down to a question of construction of s 197A, understood in the light of other provisions of the Act, and of the Constitution. The forensic context in which the question arises is as follows. The Woomera Immigration Reception and Processing Centre ("the detention centre") was established as an immigration detention centre pursuant to s 273 of the Act. The appellant1 was detained at the detention centre as an unlawful non-citizen pursuant to the obligation imposed by s 189 of the Act. He allegedly escaped. He was charged with a contravention of s 197A. The maximum penalty for such an offence is imprisonment for five years. The charge came before a South Australian magistrate. There was some debate in the Supreme Court of South Australia as to whether the proceedings were summary, or by way of committal preparatory to indictment. It is not suggested that, for present purposes, anything turns on that. The appellant was represented by senior counsel, as he has been at all times since. The appellant's lawyers sought, and obtained, the issue of witness summonses pursuant to the Magistrates Court Act 1991 (SA). Those summonses sought the production of extensive documentary material relating to conditions at the detention centre. The first and second respondents made an application to the magistrate to have the summonses set aside. There were two grounds for the application. One was that, by reason of their form and content, and the volume of material they sought, the summonses were oppressive2. The other was that the information sought was irrelevant, and therefore the issue of the summonses had no legitimate forensic purpose3 or, to express the point in terms of ss 3 and 20 of the Magistrates Court Act, the material of which they required production was not and could not be of evidentiary value4. The magistrate dismissed the application. There was an appeal to the Supreme Court of South Australia. The appeal was upheld at first instance by Gray J, who accepted the second of the two arguments stated above. As to the first, relating 1 When this matter was listed for hearing there were two other named appellants. The Court was informed that they have been removed from Australia, and the criminal charges against them dropped. At the hearing, the Court ordered that their grant of special leave to appeal be rescinded. The record has been amended accordingly. 2 Commissioner for Railways v Small (1938) 38 SR (NSW) 564. 3 R v Saleam (1989) 16 NSWLR 14. 4 Carter v Hayes (1994) 61 SASR 451. to oppression, he would have declined to interfere with the magistrate's discretion. For the reasons that follow, there is no occasion to pursue that aspect of the matter. Gray J allowed the appeal, and set aside the summonses. The Full Court of the Supreme Court of South Australia (Lander and Besanko JJ, Bleby J dissenting), refused leave to appeal. The legal basis upon which the Supreme Court of South Australia acted in setting aside the summonses is well established. It was expressed by Bigham J in R v Baines5, a criminal case in which there was an application to set aside subpoenas to testify on the ground that they were not issued for a legitimate forensic purpose, as follows: "But the Court has to inquire whether its process has been issued against [the potential witnesses] with the object and expectation on reasonable grounds of obtaining from them evidence which can be relevant." In the present case, the nature of the information sought to be obtained by the issue of the summonses appears from a reading of the summonses, and was elaborated in argument. It was information concerning the conditions at the detention centre at or about the time of the appellant's escape. The potential relevance of that information was said to be that it would, or might, disclose that the conditions of detention of the appellant were such that the detention was punitive, that it was not a form of detention authorised by the Act, and that, therefore, escape from such detention did not contravene s 197A. In the appellant's written submissions in this Court, the relevance was stated as follows (referring to all appellants): "In defence of the charges, the appellants say that the conditions at Woomera, in their harshness, go beyond anything that could reasonably be regarded as necessary for migration purposes. They say, therefore, that their detention at Woomera was not valid 'immigration detention' and escaping from it could not constitute escape from immigration detention." Such a defence must be understood in the light of the terms of the Act. It is accepted by the appellant, for the purposes of the argument, that he is an unlawful non-citizen. It is accepted that he was detained at the detention centre. It is accepted that the detention centre was established as such pursuant to s 273 of the Act. It is accepted, for the purposes of the argument, that the appellant escaped from the detention centre. Section 197A provides: [1909] 1 KB 258 at 261. "A detainee must not escape from immigration detention." Section 5 defines "detain" to mean to take, keep, or cause to be kept, in immigration detention. The word "detainee" takes its meaning from that definition. Section 5 defines "immigration detention" relevantly, to mean being held in a detention centre established under the Act. It is clear that the appellant was being held in such a detention centre. The conditions under which he was being held do not form part of the statutory concept of "immigration detention". As was noted above, the proposed defence, to which the information sought is said to be relevant, must turn upon the meaning of s 197A, read in the light of s 5, and also in the light of s 3A of the Act, which limits its application to that which is constitutionally valid. The argument for the appellant amounts to the proposition that, by reason of conditions at the detention centre, it is, or may be, possible to conclude that the appellant was not in immigration detention within the meaning of s 197A, and, therefore, did not escape from immigration detention. It is important to note what is not in issue. In order to establish a defence to the charge against him, it is not sufficient for the appellant to demonstrate, if he can, that conditions at the detention centre were such as to give the inmates a cause of action for damages, or a right to declaratory or injunctive relief, or a claim to some remedy in administrative law. (The potential availability of relief of that kind cannot be brushed aside, conveniently, as a fantasy. The appellant has, at every stage of this litigation, been represented by senior counsel.) The appellant seeks to demonstrate that, by reason of the conditions at the detention centre, he, and presumably all the other inmates, had the right to leave. He seeks to demonstrate that escaping from the detention centre was not prohibited by s 197A. There is a possible ambiguity in the expression "unlawful detention". It may refer to a case where one person has no right to detain another; the person detained has a right to be free. It could also be used to refer to a case in which the detention is authorised by law, but the conditions under which the detention is taking place are in some respects contrary to law. In the second case, the detainee may be entitled to complain, and may have legal remedies, but it does not follow that he or she is entitled to an order of release from custody, much less that he or she is entitled, in an exercise of self-help, to escape. The argument for the appellant appears to involve an intermediate position: that, while, as an unlawful non-citizen, his detention was required ("mandatory"), conditions as harsh as those at the detention centre were unlawful; and that, by reason of those conditions, what was involved at the detention centre was not "immigration detention". There is nothing novel about courts having to deal with a claim by a prisoner, or someone subjected to a form of detention authorised by law, that the conditions of custody are harsh, oppressive, or even intolerable. In R v Deputy Governor of Parkhurst Prison; Ex parte Hague6, Lord Bridge of Harwich said: "I sympathise entirely with the view that the person lawfully held in custody who is subjected to intolerable conditions ought not to be left without a remedy against his custodian, but the proposition that the conditions of detention may render the detention itself unlawful raises formidable difficulties. If the proposition be sound, the corollary must be that when the conditions of detention deteriorate to the point of intolerability, the detainee is entitled immediately to go free. It is impossible, I think, to define with any precision what would amount to intolerable conditions for this purpose ... The logical solution to the problem, I believe, is that if the conditions of an otherwise lawful detention are truly intolerable, the law ought to be capable of providing a remedy directly related to those conditions without characterising the fact of the detention itself as unlawful." The decision of the House of Lords in that case was applied by the Court of Appeal of New South Wales in 1995 in Prisoners A-XX Inclusive v State of New South Wales7, where a group of inmates of New South Wales prisons unsuccessfully claimed habeas corpus, contending that the failure to provide them with condoms exposed them to a risk of life-threatening illness. The Court of Appeal also considered Canadian and United States authority on the question. The Supreme Court of the United States, in Bell v Wolfish8, noted that there had been a series of cases before that Court involving constitutional challenges to prison conditions or practices. That case concerned prisoners held in custody pending trial. Various conditions of their confinement were said to be punitive, and therefore unconstitutional. Speaking for the majority, Rehnquist J made the point that, by hypothesis, a person complaining of conditions of confinement is being confined against his or her will: a form of treatment which, in itself, would be described, in a colloquial sense, as punitive. He said: "Not every disability imposed during pretrial detention amounts to 'punishment' in the constitutional sense, however. Once the Government [1992] 1 AC 58 at 165. (1995) 38 NSWLR 622. 8 441 US 520 at 537 (1979). has exercised its conceded authority to detain a person pending trial, it obviously is entitled to employ devices that are calculated to effectuate this detention. Traditionally, this has meant confinement in a facility which, no matter how modern or how antiquated, results in restricting the movement of a detainee in a manner in which he would not be restricted if he simply were free to walk the streets pending trial. Whether it be called a jail, or prison, or a custodial center, the purpose of the facility is to detain. Loss of freedom of choice and privacy are inherent incidents of confinement in such a facility. And the fact that such detention interferes with the detainee's understandable desire to live as comfortably as possible and with as little restraint as possible during confinement does not convert the conditions or restrictions of detention into 'punishment'." It is one thing to challenge the lawfulness of conditions of confinement, or of practices adopted by those in charge of prisons; it is another thing to assert a right to be freed by court order; and it is another thing again to assert a right to escape. One closely confined area in which the law has accepted a limited form of right to escape concerns the common law principle of necessity. In the Victorian case of R v Loughnan9, and the New South Wales case of Rogers10, consideration was given to the principles according to which a person, confronted in prison with some peril involving a threat to life or safety, may lawfully take steps, proportionate to the danger, to avoid the threat. Such steps do not ordinarily involve remaining at large in the community for an indefinite period. Thus, for example, there are United States authorities which make it a condition of pleading necessity as an excuse for escaping from prison that the prisoner, after escape, must report immediately to the proper authorities when he has attained a position of safety from the immediate threat11. The Supreme Court of Victoria, in Loughnan, said this was a matter of evidentiary significance, rather than a legal condition12. In Southwark London Borough Council v Williams13, Edmund Davies LJ, discussing the defence of necessity, pointed out that "the law regards with the deepest suspicion any remedies of self-help, and permits those remedies to be resorted to only in very special circumstances". In the present case, Gray J 10 (1996) 86 A Crim R 542. 11 People v Lovercamp 43 Cal App 3d 823 (1974); United States v Bailey 444 US 394 12 [1981] VR 443 at 451, 459. 13 [1971] Ch 734 at 745. recorded that there was no suggestion that the appellant was proposing to advance a defence of necessity, and it was not contended that he was compelled to escape to avoid some peril. Where a situation of necessity arises, it may justify action taken by a prisoner or detainee to get out of harm's way, but it does not mean that the prisoner or detainee becomes free from all the constraints of custody, or may escape into the community and remain at large. The first and second respondents do not submit, and have not at any stage of the proceedings submitted, that the Act authorises conditions of immigration detention that are inhumane, or that it removes what would otherwise be the rights of detainees to seek legal redress for civil wrongs or criminal offences to which they may be subjected. In that respect, they point to s 256 of the Act, which requires that detainees be given all reasonable facilities for obtaining legal advice or taking legal proceedings in relation to their immigration detention. What is in question is whether, by reason of their conditions of detention, detainees may lawfully escape. The argument for the appellant is that the information sought by the witness summonses is relevant because it will, or may, establish that conditions at the detention centre were such that the appellant was not in immigration detention within the meaning of s 197A. The reason is said to be that, in the Act's constitutionally valid application (see s 3A), the detention which is in contemplation is detention which is not punitive in nature, whereas detention under harsh or inhumane conditions is punitive. The detention which the Act contemplates, authorises, and requires is detention of unlawful non-citizens (aliens) pending processing of their visa applications or deportation. Section 189 provides that, if an officer knows or reasonably suspects that a person in the migration zone is an unlawful non- citizen, the officer must detain the person. (Reference has already been made to s 273, which empowers the establishment of detention centres.) Section 196 provides that an unlawful non-citizen detained under s 189 must be kept in immigration detention until he or she is removed or deported (under ss 198, 199 or 200) or granted a visa. Applications for a visa are commonly made on the basis that the applicant is a person to whom Australia owes protection obligations under the Refugees Convention14. Section 198 provides, in sub-s (6), that an officer must remove as soon as reasonably practicable an unlawful non-citizen who is a detainee if the non-citizen has made a visa application and the application has been finally determined in a manner adverse to the applicant. Visa applications are dealt with administratively in the first instance, but are 14 The Convention relating to the Status of Refugees done at Geneva on 28 July 1951, as amended by the Protocol relating to the Status of Refugees done at New York on 31 January 1967. subject to a potentially lengthy process of administrative and judicial review. Cases regularly come before this Court in circumstances where this Court is invited to undertake a fifth level of decision-making in respect of a visa application. Some visa applicants hold temporary visas, and are not in immigration detention, but those who do not have visas may be detained for a substantial period while their litigation proceeds. The constitutional validity of the system of mandatory detention, which was introduced in 1992, was challenged unsuccessfully in this Court in Chu Kheng Lim v Minister for Immigration15. The Court held that the legislation was a valid exercise of the power, conferred by s 51(xix) of the Constitution, to make laws with respect to naturalization and aliens. Mason CJ said16: "I agree with [Brennan, Deane and Dawson JJ] that the legislative power conferred by s 51(xix) of the Constitution extends to conferring upon the Executive authority to detain an alien in custody for the purposes of expulsion or deportation and that such authority constitutes an incident of executive power. I also agree that authority to detain an alien in custody, when conferred in the context and for the purposes of executive powers to receive, investigate and determine an application by that alien for an entry permit and (after determination) to admit or deport, constitutes an incident of those executive powers and that such limited authority to detain an alien in custody can be conferred upon the Executive without contravening the investment of the judicial power of the Commonwealth in Ch III courts." The concluding portion of that passage refers to an argument, dealt with extensively by Brennan, Deane and Dawson JJ, and rejected, that detention of the kind there under consideration was an exercise of judicial power, and could not be conferred constitutionally on Brennan, Deane and Dawson JJ17, distinguishing explicitly between citizens and aliens, said that, subject to certain well-established exceptions, the involuntary detention of a citizen is penal or punitive in character and exists only as an incident of judicial power. (Gaudron J said in another case that the exceptions are so numerous and important that it is difficult to sustain the primary proposition as a general rule18.) The position with respect to aliens is different because of their vulnerability to exclusion or deportation, which flows from both the common law and the the Executive. 15 (1992) 176 CLR 1. 16 (1992) 176 CLR 1 at 10. 17 (1992) 176 CLR 1 at 26-32. 18 Kruger v The Commonwealth (1997) 190 CLR 1 at 110. provision of the Constitution. In that respect, I would interpolate, exclusion includes what was referred to by the Solicitor-General of the Commonwealth in argument in Chu Kheng Lim as power to make laws "to prevent aliens who ... come to Australia without permission from entering the community pending a decision whether to grant them an entry permit or to remove them from the country"19. Authority to detain an alien in custody, Brennan, Deane and Dawson JJ said, in the context and for the purposes of executive powers to receive, investigate and determine an application for an entry permit and, after determination, to admit or deport, is not punitive in nature, and not part of the judicial power of the Commonwealth. In the case of a citizen, what is punitive in nature about involuntary detention (subject to a number of exceptions) is the deprivation of liberty involved. But an alien does not have a right without permission to enter Australia or to become part of the community. The alien's vulnerability to exclusion and deportation alters the nature of the detention when it is for the purpose described above. It is an incident of the executive power to exclude people who have no right to enter Australia, to process their applications for permission to enter, and to deport them if their applications fail. That being the nature of the power of detention, there is no warrant for concluding that, if the conditions of detention are sufficiently harsh, there will come a point where the detention itself can be regarded as punitive, and an invalid exercise of judicial power. Whatever the conditions of detention, the detention itself involves involuntary deprivation of liberty. For a citizen, that alone would ordinarily constitute punishment. But for an alien, the detention is an incident of the exclusion and deportation to which an alien is vulnerable. Harsh conditions of detention may violate the civil rights of an alien. An alien does not stand outside the protection of the civil and criminal law. If an officer in a detention centre assaults a detainee, the officer will be liable to prosecution, or damages. If those who manage a detention centre fail to comply with their duty of care, they may be liable in tort. But the assault, or the negligence, does not alter the nature of the detention. It remains detention for the statutory purpose identified above. The detention is not for a punitive purpose. The detainee is deprived of his or her liberty, but not as a form of punishment. And the detainee does not cease to be in immigration detention within the meaning of the Act. The information the subject of the witness summonses might have assisted the appellant to demonstrate that he had a legitimate cause for complaint about his conditions of detention, and that he had a case for legal redress. But it could not have assisted an argument that he was not in immigration detention, or that s 197A did not validly prohibit his escape. The definition of "immigration detention" in s 5 of the Act includes being held in a detention centre established 19 (1992) 176 CLR 1 at 6-7. under the Act. The appellant was being held in a detention centre so established. By definition, he was in immigration detention. The nature of this detention was established by the statutory provisions pursuant to which, and for the purpose of which, his detention was required. The statutory definition applied to this case. That from which he escaped was immigration detention. The conditions at the detention centre could not alter the case. For that reason, the information was irrelevant to the charge of a contravention of s 197A. The purpose for which the summonses were issued was not a legitimate forensic purpose. The decision of Gray J, and of the Full Court of the Supreme Court of South Australia, was correct. The appellant's appeal should be dismissed with costs. McHugh 24 McHUGH, GUMMOW AND HEYDON JJ. Since the grant of special leave in this case on 14 August 2003, the parties identified as the second and third appellants in the special leave application, Mr Mahmood Gholani Moggaddam and Mr Davood Hossein Amiri respectively, have been removed from Australia and a nolle prosequi has been entered in each instance. On the first day of the hearing in this Court, the grant of special leave in their favour was rescinded. Mr Behrooz remains the sole appellant. This appeal turns upon the operation of s 197A of the Migration Act 1958 (Cth) ("the Act") and associated provisions. Section 197A was added to the Act with effect from 27 July 200120. It states: "A detainee must not escape from immigration detention. Penalty: Imprisonment for 5 years." A prosecution for an offence against s 197A may be instituted at any time within five years after the commission of the offence (s 492(1)). The term "immigration detention" is defined in s 5(1) of the Act so as to include: "being held by, or on behalf of, an officer ... in a detention centre established under this Act". Section 273 empowers the Minister for Immigration and Multicultural and Indigenous Affairs ("the Minister") on behalf of the Commonwealth to cause the establishment and maintenance of centres for the detention of persons authorised under the Act. One such centre is the Woomera Immigration Reception and Processing Centre ("Woomera") which is proximate to the township of Woomera in the far north of South Australia, some 500 kilometres from Adelaide. Australasian Correctional Management Pty Ltd ("Management") and Australasian Correctional Services Pty Ltd ("Services") are, by arrangement with the Commonwealth, responsible for the management of Woomera. Management and Services are the third and fourth respondents in this Court but played no active role in the appeal. The Secretary of the Department of Immigration and Multicultural and Indigenous Affairs ("the Department") is the first respondent. The second respondent is the Attorney-General of the Commonwealth. 20 By the Migration Legislation Amendment (Immigration Detainees) Act 2001 (Cth), Sched 1, Item 3. McHugh The appellant, Mr Behrooz, is an Iranian national and unlawful non-citizen who was detained at Woomera. He was among six detainees alleged to have escaped from Woomera in the early hours of 18 November 2001. At the time of his alleged escape, the appellant had been in immigration detention under the Act for about 12 months. The Magistrates Court Act 1991 (SA) ("the Magistrates Act") establishes the Magistrates Court of South Australia as a court of record (ss 4, 5). It is one of those State courts invested with federal jurisdiction by s 68 of the Judiciary Act 1903 (Cth) ("the Judiciary Act")21. By information sworn on 21 November 2001 and laid under the Summary Procedure Act 1921 (SA), Mr Behrooz and the two former appellants were charged with escaping from immigration detention contrary to s 197A of the Act. Summonses for production Section 20 of the Magistrates Act empowers that Court to require the production of "evidentiary material", a term given a broad meaning in s 3. On 10 January 2002, on application of the appellants, there were issued out of the Port Augusta Magistrates Court summonses to Management, Services and the proper officer of the Department. All summonses sought production of evidentiary material which had come into existence since 1 December 1999 and referred in specified ways to conditions at Woomera. Applications were made by the recipients to set aside the summonses as oppressive and abuses of the process of the Court. After a contested hearing in which the Attorney-General of the Commonwealth intervened and was represented by senior counsel, the Magistrates Court delivered reasons for judgment on 24 May 2002. The Court was satisfied by the appellants that, upon the balance of probabilities, documents were sought which were likely to be relevant to their proposed defence to the charges of escaping contrary to s 197A of the Act. The Court recorded that defence as being: "[E]ven though detention for the purposes of [the Act] was capable of being valid detention, if the conditions of detention were so obviously 21 There has been no submission that Woomera is located in a "Commonwealth place" within the meaning of the Commonwealth Places (Application of Laws) Act 1970 (Cth), so as to render State laws applicable (s 4) and invest federal jurisdiction in State courts by force of s 7 of that statute. See Pinkstone v The Queen (2004) 78 ALJR 797 at 803-805 [33]-[41], 813 [81]-[82]; 206 ALR 84 at McHugh harsh as to render them punitive, then the detention went beyond that which was authorised by the Act and was necessarily illegal." Detention at Woomera was said to be of this character, so that a detainee who escaped did not escape from a form of detention authorised by the statute. The applications to set aside the summonses were dismissed, save in respect of those documents relating to periods outside the period of 23 months prior to 18 November 2001 and which related solely to minors. The period of 23 months was the longest period for which any of the three appellants had been in detention before their alleged escape. The Supreme Court An appeal was taken by the first respondent to the Supreme Court of South Australia constituted by a single judge (Gray J)22. The Supreme Court allowed the appeal and set aside the summonses. Mr Behrooz and the other appellants then moved the Full Court of the Supreme Court for leave to appeal. The application for leave was refused (Lander and Besanko JJ; Bleby J dissenting)23 on 16 January 2003. In this Court Mr Behrooz seeks an outcome setting aside that refusal of leave to appeal from the orders of Gray J, granting that leave and reinstating the order of the magistrate. In the Full Court of the Supreme Court, the majority supported the conclusion reached by Gray J. Their Honours held that it was not reasonably arguable that Gray J had erred in concluding that there had been a failure by the appellants to identify a defence to the charges under s 197A which was known to law24. Section 196(1) states that an unlawful non-citizen detained under s 189 "must be kept in immigration detention until" removal from Australia under s 198 or s 199, deportation under s 200 or the grant of a visa. Shortly before the South Australian Full Court decision, the Full Federal Court had held in NAMU 22 Secretary, Department of Immigration and Multicultural and Indigenous Affairs v Behrooz (2002) 84 SASR 453. 23 Behrooz v Secretary, Department of Immigration, Multicultural and Indigenous Affairs (2003) 84 SASR 479. 24 (2003) 84 SASR 479 at 480. McHugh of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs25 that "the factual consequences" of detention for a particular individual did not render s 196(1) invalid in its application to that individual. The majority of the South Australian Full Court concluded that, even if by the documents production of which was sought there was disclosed "evidentiary material" within the meaning of the Magistrates Act which would support a case based on the harshness of conditions at Woomera, such a case could not provide a defence to the charges under s 197A. Lander and Besanko JJ said26: "The [appellants] seek to argue that their detention at [Woomera] was unlawful because of the harshness of the conditions at [Woomera]. The status of the [appellants] as unlawful non-citizens is not challenged. The fact that in the first instance they were lawfully detained, pursuant to s 189 of [the Act], is not disputed. The [appellants] do not question the validity of any section of [the Act], particularly s 196 of the Act. Thus, it is not disputed that in being detained they were in immigration detention. There is no dispute that [Woomera] was established as an immigration detention centre pursuant to the Act. We cannot see how it can be said that the harshness of the conditions at [Woomera] can lead to the conclusion that the [appellants] were no longer detainees or in some way they were no longer being held in immigration detention. We do not accept that harshness of conditions in a detention centre means that a detention centre ceases to have the character of a detention centre by reason that the harshness of conditions is contrary to the power of detention in the Act. Thus, we are of the opinion that even if the harshness of conditions was established that would not mean that any of the elements of this offence under s 197A of the Act would remain unproved." The appeal to this Court The appellant challenges the reasoning in that passage. No challenge is made to the decision of the Full Federal Court in NAMU, but it is said that the 25 (2002) 124 FCR 589 at 596-598. 26 (2003) 84 SASR 479 at 480. McHugh issue here differs. The issue is said to be not whether s 196(1) of the Act which mandates a continued detention is valid, given "the factual consequences" for particular detainees, but whether the Act "can and does authorize the kinds of conditions that prevailed at Woomera; and if not, whether the [appellant was] in valid immigration detention there". Gray J had noted that the materials before the Supreme Court did not provide information about conditions at Woomera "which directly affected or related to any of [the appellants]"27. Section 197A posits a "detainee", a term defined in s 5(1) as meaning "a person detained". The restraint by which or the place where the person is detained is the "immigration detention" from which it is made an offence to escape. The submissions on the appeal, for their success, require acceptance of the proposition that a person detained in what is other than "immigration detention" in the defined sense of that term is unconstrained by s 197A from escaping that detention. The appellant relies upon the definition of "detain" in s 5(1) to support the proposition that "immigration detention" may include the taking of action and using of force which is no more than "reasonably necessary" for migration control purposes. Thereby the appellant seeks to constrain the prohibition against escape the purpose and imposed by s 197A with notions of proportionality of the conditions of confinement at Woomera. The definition of "detain" in s 5(1) is that it: "means: take into immigration detention; or keep, or cause to be kept, in immigration detention; and includes taking such action and using such force as are reasonably necessary to do so." An example of meaning (a) is provided by s 189. This imposes upon officers what otherwise would be an incompletely expressed duty to "detain" certain persons; the definition makes it clear that the duty is discharged by the taking of persons into "immigration detention". An example of meaning (b) is provided by s 273 which authorises the establishment of centres for the detention of persons whose detention is authorised under the Act, that is to say, by keeping or causing them to be kept in "immigration detention". 27 (2002) 84 SASR 453 at 455. McHugh The phrase in the definition of "detain", "as are reasonably necessary to do so", amplifies by the use of the term "include" what is meant by to "take into" and to "keep, or cause to be kept". As Hayne J explains in his reasons, the phrase does not qualify what is meant by "immigration detention". That is the central element for s 197A and to that term we now turn. "Immigration detention" The definition of "immigration detention" in s 5(1) spans various kinds of restraint, of which being held in a detention centre is but one. The definition reads: "immigration detention means: being in the company of, and restrained by: an officer; or in relation to a particular detainee – another person directed by the Secretary to accompany and restrain the detainee; or being held by, or on behalf of, an officer: in a detention centre established under this Act; or in a prison or remand centre of the Commonwealth, a State or a Territory; or (iii) in a police station or watch house; or in relation to a non-citizen who is prevented, under section 249, from leaving a vessel – on that vessel; or in another place approved by the Minister in writing; but does not include being restrained as described in subsection 245F(8A), or being dealt with under paragraph 245F(9)(b)". Further, the term "officer" encompasses a wide variety of individuals, as is apparent from the definition in s 5(1): McHugh "officer means: an officer of the Department, other than an officer specified by the Minister in writing for the purposes of this paragraph; a person who is an officer for the purposes of the Customs Act 1901, other than such an officer specified by the Minister in writing for the purposes of this paragraph; or a person who is a protective service officer for the purposes of the Australian Protective Service Act 1987, other than such a person specified by the Minister in writing for the purposes of this paragraph; or a member of the Australian Federal Police or of the police force of a State or an internal Territory; or a member of the police force of an external Territory; or a person who is authorised in writing by the Minister to be an officer for the purposes of [the Act]; or any person who is included in a class of persons authorised in writing by the Minister to be officers for the purposes of [the Act], including a person who becomes a member of the class after the authorisation is given." So, for example, s 249(1) empowers an officer to take such action and use such force as are necessary to prevent a person reasonably suspected to be an unlawful non-citizen from leaving a vessel on which the person arrived in Australia; being held by an officer in these circumstances is "immigration detention". Again, a person who is in the company of and restrained by an officer for the purposes of executing a deportation order would be in "immigration detention" (ss 206, 253). Further, s 252F renders applicable as federal laws certain State and Territory laws where detainees are held "in immigration detention in a prison or remand centre of a State or Territory". These examples, drawn from the variety of operations of the definition of "immigration detention" and thus of the reach of s 197A, support a central submission by the first and second respondents. The submission is that there is a relevant distinction to be drawn between lawful authority to detain and the means by which the detention is achieved and enforced, including the conditions of the detention. McHugh The first exclusion in the concluding lines of the definition of "immigration detention" assists in making the point. "Immigration detention" does not include being restrained as described in s 245F(8A). That sub-section states: "If an officer detains a ship or aircraft under this section, any restraint on the liberty of any person found on the ship or aircraft that results from the detention of the ship or aircraft is not unlawful, and proceedings, whether civil or criminal, in respect of that restraint may not be instituted or continued in any court against the Commonwealth, the officer or any person assisting the officer in detaining the ship or aircraft." In such provisions the Act evinces a distinction between the creation and continuance of the state or condition of being in "immigration detention" and the civil and criminal liabilities which officers may encounter in relation thereto. What otherwise might be civil or criminal liability arising by acts done by officers in the exercise of authority to detain persons is qualified by a number of express provisions28. One such is s 245F(8A) set out above. In addition, action in good faith and with no more than reasonable force is excused in a range of cases. These include body searches (ss 245FA, 252), and removal of persons from ships and aircraft (s 245F(9A), (9B), (10)). No such qualification to what otherwise would be liabilities of officers under the criminal or civil law is made in respect of that species of immigration detention with which the present appeal is concerned. These considerations give added force to the conclusion expressed by the primary judge as follows29: "If intolerable conditions were established to exist at [Woomera] civil equitable and [administrative law] remedies may be pursued. Criminal sanctions may also be available. The custodians of detainees are legally accountable. The [appellants'] detention pursuant to [the Act] is valid. As their detention is lawful the proposed defence cannot arise as a matter of law." 28 cf Daniels Corporation International Pty Ltd v Australian Competition and Consumer Commission (2002) 77 ALJR 40 at 43 [11], 49 [43], 57 [90], 66-67 [134]; 192 ALR 561 at 565, 573, 584-585, 597. 29 (2002) 84 SASR 453 at 472. McHugh In this Court, the first and second respondents accepted that the Act does not authorise detention in inhumane conditions. Rather, it was submitted, the Act: "provides a scheme which operates against the fabric of the common law and State law pursuant to which remedies are available to redress issues relating to conditions of detention and treatment of detainees, to the extent to which they are not inconsistent with the Act". The reference to inconsistency with the statute was to the line of authority exemplified by Crimmins v Stevedoring Industry Finance Committee30 which indicates that a common law duty of care will not be imposed where to do so would be inconsistent with a particular statutory scheme. Subject to that qualification, the respondents accept that the statute confers no immunity from liability in negligence for breach of a duty of care nor from the application of the general criminal law. Their submission adds: "Equally, for example, an action for damages may lie for assault or trespass to the person, subject to express or implied statutory authority to carry out such acts as in the case of bodily searches or the provision of medical treatment without consent." Those propositions should be accepted and provide an answer to the primary submission of the appellant respecting the construction of s 197A. While the conditions in which detention is suffered may attract remedies of the nature indicated above, they do not deny the legality of the immigration detention and so cannot found a defence to a charge under s 197A. Additional authorities This conclusion is reached without particular assistance otherwise than by way of loose analogy from the reasoning in two decisions to which much reference was made in submissions. The first is that of the House of Lords in R v Deputy Governor of Parkhurst Prison, Ex parte Hague31. In that case, the House of Lords decided that the operation of legislation which provided lawful authority for the detention of convicted prisoners was not qualified or abrogated by conditions of detention of particular prisoners. In Prisoners A-XX Inclusive v 30 (1999) 200 CLR 1. McHugh State of New South Wales32, the New South Wales Court of Appeal referred to Hague as authority supporting its conclusion that with the New South Wales legislation, as with that in the United Kingdom, "intolerable" conditions of detention did not deprive imprisonment of its continued statutory basis. Reference was made in argument to a number of decisions of the United States Supreme Court. These have concerned two questions. The first is whether conditions or treatment of convicted federal and state prisoners may attract protection of residual "liberty interests" by the Due Process Clause and by the proscription in the Eighth Amendment of the infliction of cruel and unusual punishments. Wolff v McDonnell33 and Sandin v Conner34 indicate that the conduct of disciplinary systems and procedures may enliven the Due Process Clause. In 1976, it was decided in Estelle v Gamble35 that there was an Eighth Amendment violation by reason of failure to provide adequate medical care. Thereafter, in Wilson v Seiter36, Scalia J, delivering the opinion of the Court, explained: "[W]e see no significant distinction between claims alleging inadequate medical care and those alleging inadequate 'conditions of confinement'. Indeed, the medical care a prisoner receives is just as much a 'condition' of his confinement as the food he is fed, the clothes he is issued, the temperature he is subjected to in his cell, and the protection he is afforded against other inmates." On the other hand, the Supreme Court has warned federal trial courts not to become "enmeshed in the minutiae of prison operations"37. The second question concerns the remedy for such violations of constitutional rights, in particular the availability of habeas corpus for deprivation of "residual liberty", in addition to the civil action under 42 USC 32 (1995) 38 NSWLR 622 at 628-630. 36 501 US 294 at 303 (1991). 37 Bell v Wolfish 441 US 520 at 562 (1979). See, generally, Antieau and Rich, Modern Constitutional Law, 2nd ed (1997), vol 2, pars 41.45-41.52. McHugh §1983. That statutory action is for deprivation of "any rights, privileges, or immunities secured by the Constitution and laws", the remedy being by "an action at law, suit in equity, or other proper proceeding for redress"38. In Prisoners A-XX Inclusive v State of New South Wales39, Sheller JA referred to the detailed discussion of the United States position respecting habeas corpus by the Supreme Court of Canada in Miller v The Queen40. Sheller JA concluded that, on the United States authorities placed before the Court of Appeal, the reach of the "residual liberty" to found a writ of habeas corpus for "intolerable conditions" was unsettled41. However, it is to be noted that the actions which reached the Supreme Court in the authorities referred to above, Wolff v McDonnell, Sandin v Conner, Estelle v Gamble and Wilson v Seiter, were proceedings under §1983. It is unnecessary further to consider these matters in this appeal. Enough has been said to indicate that the primary question in the United States has been the reach of the constitutional guarantees found in express terms not seen in Australia. Other grounds The conclusion that the decision of Gray J was properly based on his Honour's conclusion that the proposed defence could not arise as a matter of law makes it unnecessary to consider further grounds advanced in this Court to support the setting aside of the summonses. While Gray J allowed the appeal and set aside the summonses on the ground indicated, his Honour also held that the magistrate had not otherwise erred in declining to set the summonses aside on grounds that they were oppressive or involved an abuse of process42. Upon these matters this Court should find it unnecessary to enter. 38 42 USC §1983 derives from s 2 of the Civil Rights Act of 1866 (14 Stat 27) and s 1 of the Ku Klux Klan Act of 1871 (17 Stat 13): Wright and Kane, Law of Federal Courts, 6th ed (2002), §22A, n 11. 39 (1995) 38 NSWLR 622 at 630-633. 40 (1985) 24 DLR (4th) 9. 41 (1995) 38 NSWLR 622 at 633. 42 (2002) 84 SASR 453 at 473-478. McHugh Order The appeal should be dismissed with costs. Kirby In Rhodes v Chapman43, Brennan J, in the Supreme Court of the United States, observed that where "voteless, politically unpopular, and socially threatening" detainees bring proceedings before the courts to assert or defend their legal rights, judicial intervention may be indispensable "if constitutional dictates – not to mention considerations of basic humanity – are to be observed". I agree with this proposition. It informs my approach to this appeal. The appeal concerns whether "immigration detention" ceases to be such, within the Migration Act 1958 ("the Act"), when the conditions of that "detention" are inhuman or intolerable. In my view, it is arguable that it does: detention is not "immigration detention" if it involves conditions that are inhuman or intolerable. Evidence on the point was therefore admissible in these proceedings, indeed critical. The court below erred in concluding that the issue was not legally arguable. The facts The "escape" and charges: Mr Mahran Behrooz ("the appellant"), a national of Iran, arrived in Australia without a visa. He was designated by the Act an "unlawful non-citizen"44. He was taken into immigration detention. From early 2000, he was held at the Woomera Immigration Reception and Processing Centre ("Woomera"). On or about 18 November 2001 the appellant left (to use a neutral expression) Woomera along with other detainees being held there. He was subsequently taken back into custody. Together with two others (Mr Mahmood Gholani Moggaddam and Mr Davood Hossein Amiri) he was charged with an offence against s 197A the Act. The offence was that "being a detainee [he] escaped from Immigration Detention". The section provides: "A detainee must not escape from immigration detention. Penalty: Imprisonment for 5 years." Similar charges were brought against Mr Moggaddam and Mr Amiri. They made common cause with the appellant in their defence. However, between the decision under appeal and the hearing in this Court they were, at their own request, removed from Australia. The Director of Public Prosecutions 43 452 US 337 at 354, 358 (1981). See Taylor, "Detained Aliens Challenging Conditions of Confinement and the Porous Border of the Plenary Power Doctrine", (1995) 22 Hastings Constitutional Law Quarterly 1087 at 1127. Kirby withdrew the criminal proceedings against each of them. The proceedings against the appellant remain on foot. The magistrate's ruling: In the Magistrate's Court of South Australia, the appellant foreshadowed a defence that he wished to bring in answer to the charge. In part, the defence was based on the terms of the Act, on their face, and in part upon those terms as understood in the light of the Constitution. Counsel indicated that he wished to argue that the conditions in which the appellant was kept at Woomera were "so obviously harsh" as to fall outside the notion of "immigration detention" as envisaged by the Act and as permitted by the Constitution. Because the conditions in which he was kept did not, therefore, amount to "immigration detention", the appellant's departure from those conditions did not constitute an "escape from immigration detention" within s 197A. He was therefore entitled to be acquitted of the charge. The appellant placed certain materials before Mr Moss CM in a hearing in the Magistrate's Court relating to the charge. These were designed to demonstrate the bona fides and factual arguability of the defence just stated. In an attempt to establish the defence by relevant evidence, witness summonses were issued by the Magistrate's Court in January 2002 at the request of the appellant. These required the departmental and management organisations responsible for Woomera to produce to the Court documents concerning the conditions at Woomera and complaints received about those conditions. An application was made on behalf of the recipients of the summonses for an order setting them aside. The Attorney-General of the Commonwealth intervened to support that application. In substance, the Chief Magistrate rejected the application. With some modifications as to detail, he confirmed the summonses. Decisions in the Supreme Court: Against those orders, an appeal45 was taken to the Supreme Court of South Australia. It was heard by the primary judge (Gray J). His Honour rejected one of the two bases argued, namely that the summonses were expressed in terms that were oppressive46. However, he upheld the primary objection that the appellant had not "established that the material sought by the summonses has evidentiary value in the proceedings"47. Principally, his Honour concluded that the appellant had not identified a "defence known to the law" and that his complaint about the conditions in which he was held at Woomera, even if proved, could not, "as a matter of law make the 45 And a proceeding for judicial review which did not ultimately have to be decided. 46 Secretary, Department of Immigration and Multicultural and Indigenous Affairs v Behrooz (2002) 84 SASR 453 at 457 [11], 477-478 [88]-[90]. 47 Behrooz (2002) 84 SASR 453 at 473 [72]. Kirby detention unlawful"48. On that basis, the primary judge set the witness summonses aside. The appellant then sought leave to appeal. His application came before the Full Court of the Supreme Court of South Australia49. That Court dealt only with the arguability of the defence. It did not consider the primary judge's determination of the issue relating to alleged oppression. A majority of the Full Court (Lander and Besanko JJ) favoured refusal of leave to appeal50. Their Honours considered it arguable that the primary judge had placed too high an onus on the appellant in rejecting the factual relevance of the materials that the appellant had sought in the summonses51. However, like the primary judge, the majority concluded that the evidence sought could not, as a matter of law, establish a defence to the charge under s 197A. The other judge constituting the Full Court (Bleby J) dissented. He concluded that the appellant had an arguable case and that the issues were of obvious importance for the operation of the Act. He would have granted leave to appeal52. The hearing in this Court: By special leave, the appellant now brings an appeal to this Court. Some of the issues argued in the case overlapped those presented in concurrent proceedings53. However, unlike those proceedings, it is not possible in my view to resolve the appellant's arguments in this appeal by means of statutory interpretation, confining the issues for decision to the four corners of the Act. Here, the issues are more numerous and complex. In resolving those issues, this Court had the considerable assistance of written submissions filed for the Human Rights and Equal Opportunity Commission ("HREOC"). Whilst not offering argument addressed to the merits of the appellant's case, HREOC's 48 Behrooz (2002) 84 SASR 453 at 473 [73]. 49 Behrooz v Secretary, Department of Immigration, Multicultural and Indigenous Affairs (2003) 84 SASR 479. 50 Behrooz (2003) 84 SASR 479 at 479 [1], 480 [10]. See also reasons of McHugh, Gummow and Heydon JJ (the "joint reasons") at [35]; reasons of Callinan J at 51 Behrooz (2003) 84 SASR 479 at 479-480 [2]-[3]. 52 Behrooz (2003) 84 SASR 479 at 480 [11]. See reasons of Callinan J at [202]. 53 In Al-Kateb v Godwin [2004] HCA 37 and Minister for Immigration and Multicultural and Indigenous Affairs v Al Khafaji [2004] HCA 38. Kirby submissions added a dimension to the arguments by reference to the obligations accepted by Australia under international law, affecting the "detention" of the appellant. It is easy for a Court such as this to overlook such important legal perspectives. To the extent that it does, this Court places itself outside the mainstream of constitutional and common law doctrine as it is developing in virtually every country of the world54. Common ground Uncontested issues: The issues for decision in the appeal were narrowed by a high measure of common ground between the parties. For the appellant it was conceded that, in accordance with the Act, he was an "unlawful non- citizen"55 and that, his initial detention, as such, was lawful56. The appellant did not contest the constitutional power of the Federal Parliament to enact provisions for the detention of an alien such as himself57. It was not the appellant's case that, because of the conditions of his "detention" at Woomera he was entitled to free release into the Australian community. He confined his claim to the assertion of a defence to the criminal charge brought against him and to his argument that the conditions in which he was kept did not answer, under the Act or the Constitution, to a legally permissible form of administrative "detention". The respondents accepted that the witness summonses were addressed to the proper officers of their organisations and that the course of appealing against the Chief Magistrate's order had interrupted the trial of the appellant on a serious criminal charge. They also accepted that if the trial were to go ahead without all, or any, evidence as sought in the summonses, it would have to be decided on the limited factual basis that the appellant could otherwise provide. Thus, it would be determined without the benefit of evidence procured from the respondents. If a defence were legally available, this would place the appellant in an intolerable position. The appellant conceded that, for the purpose of advancing his submission that his detention amounted to a form of "punishment", impermissible under the 54 See, for example, Lawrence v Texas 539 US 558 (2003). See also Koh, "International Law as Part of Our Law", (2004) 98 American Journal of International Law 43. 55 Behrooz (2003) 84 SASR 479 at 480 [5]-[6]. 56 Under the Act, ss 5, 14(1), 189(1). 57 Under the Constitution, s 51(xix). See also s 51(xxvii). The validity of immigration detention was upheld in Chu Kheng Lim v Minister for Immigration (1992) 176 CLR 1. Kirby Constitution and outside that contemplated by the Act, the mere fact that immigration detention impinged on his liberty, did not make it punitive as such. The respondents, for their part, conceded that the Act does not authorise detention in inhuman or intolerable conditions. However, they argued that the remedies for inhuman detention lay not in denial of the legality of the detention itself, but in tortious, administrative and other proceedings brought to challenge the alleged mistreatment. The appellant did not assert that he was compelled to escape from Woomera by an immediate threat or danger. Nor did he propound a defence to the charge brought against him based on the doctrine of necessity in criminal law58. He confined the defence, for which he sought to procure the evidence specified in the summonses, to one based on the meaning of "detention" as provided in the Act and as permitted by the Constitution. Three added facts: This Court was informed, without opposition, of three facts. First, that as a result of the interruption occasioned by the interlocutory appeal to the Supreme Court, the trial of the appellant had been delayed pending the outcome of these proceedings. Secondly, that a number of communications complaining about the conditions of immigration detention under the Act at Woomera and elsewhere had been taken to the Human Rights Committee of the United Nations ("UNHRC"). We were supplied with copies of the views of the UNHRC and other bodies upon some such communications59. Thirdly, the Court was told that, since the happening out of which the charge against the appellant arose, the immigration detention centre at Woomera has been closed60. The applicable legislation The system of mandatory detention: The provisions of the Act relevant to the determination of the appeal, in addition to s 197A under which the appellant is charged are set out, or referred to, in other reasons61. I will not repeat any of this material. 58 Behrooz (2002) 84 SASR 453 at 472-473 [71] per Gray J, referring to R v Loughnan [1981] VR 443 at 448. 59 A v Australia, Human Rights Committee Communication No 560/1993; C v Australia, Human Rights Committee Communication No 900/1999; Baban v Australia, Human Rights Committee Communication No 1014/2001. See also Bakhtyari v Australia, Human Rights Committee Communication No 1069/2002. 60 [2003] HCATrans 306 at 433. 61 Joint reasons at [25], [44]; reasons of Hayne J at [159]-[164]; reasons of Callinan J Kirby Different countries have established various schemes for the determination of claims to refugee status under the Refugees Convention62. Australia's enactment of a system of mandatory detention for persons arriving without due authority is not the only response available to that problem63. However, the reasons for it are sometimes explained by reference to considerations of history, geography, the size of the continent, its scattered centres of population and the absence of any general obligation to carry identity documents within Australia. The appellant accepted the constitutional validity of the scheme established by the Act to impose regulations upon entrants to Australia's "migration zone"64, to require the identification of non-citizens, to detain those attempting to enter without authority, to hold them in detention whilst processing any application they might make to remain in Australia and to remove or deport those remaining non-citizens determined to have no authority to remain or who, like the appellant's co-accused, request their own removal65. Conditions of detention: The Act lays down relatively clear obligations to effect detention in given circumstances66; what that detention involves, in terms of physical action and place67; and what must ensue "as soon as reasonably 62 Convention relating to the Status of Refugees done at Geneva on 28 July 1951, [1954] Australian Treaty Series No 5; Protocol relating to the Status of Refugees done at New York on 31 January 1967, [1973] Australian Treaty Series No 37. 63 Billings, "A Comparative Analysis of Administrative and Adjudicative Systems for Determining Asylum Claims", (2000) 52 Administrative Law Review 253 at 268- 269. In 1998, the HREOC report Those Who've Come Across the Seas: Detention of Unauthorised Arrivals, recommended that the detention of asylum seekers should be a last resort, for use only on exceptional grounds (at 53). This recommendation has not been accepted by the Parliament. The Parliamentary Joint Standing Committee on Migration subsequently undertook a review of the Act. However, it concluded that no alternative to mandatory detention was acceptable given the absence of a national identity card in Australia and the consequent difficulty of identifying illegal non-citizens once they had crossed the frontier. 64 See the Act, ss 5(1), 6, 13(1), 14(1). See also Migration Amendment (Excision from Migration Zone) Act 2001 (Cth) and Migration Amendment (Excision from Migration Zone) (Consequential Provisions) Act 2001 (Cth). 65 See the Act, s 4 ("Object of Act"), set out in the reasons of Callinan J at [203]. 66 The Act, s 189, set out in the reasons of Callinan J at [209]. 67 The Act, s 5. See reasons of Callinan J at [204]. Kirby practicable" for the removal (or deportation) of the non-citizen. However, it is generally silent concerning the conditions of such detention. In particular, nothing is said in the Act specifically about the minimum conditions that must be observed for people held in "immigration detention" or at "a detention centre". On the face of things, this might appear to leave such conditions to the unfettered discretion of the Minister, accountable for them to the Parliament, or to officials and other persons (such as the respondents) concerned in the organisation and maintenance of detention centres. The Act permits regulations to be made which might conceivably include provisions for the conditions of persons in "immigration detention"68. However, it is apparent that, to the relevant time, no such regulations had been made to govern the conditions of detention centres69. True, there are immigration detention standards. The appellant complained that these were not complied with in his case70. The absence of a statutory elaboration of the conditions within an immigration detention centre does not mean that there are no standards which the law of this country will uphold. Correctly, the respondents accepted that the Act, being made as a law to operate "against the fabric of the common law and State law", would not authorise administrative detention in inhuman and intolerable conditions. The obligations implied into the Act by the general law, or grafted onto its provisions, could not contradict the necessities, express or implied, in valid provisions of the Act71. But the respondents submitted that the way to enforce any complaint about inhuman or intolerable conditions was by proceedings brought for that purpose. It was not self-help, such as by escape from "detention". The authority to be in immigration detention being established by law, escape could not therefore be lawful. The respondents supported the conclusion of the Supreme Court that the argument to the contrary was legally untenable. The issues The following issues arise in the appeal: Approach to the claim for summary relief: What approach was it proper for the courts below to take to the respondents' application for peremptory relief against the witness summonses sought by the appellant? Was it 68 The Act, s 273. 69 [2003] HCATrans 458 at 6465-6467. 70 [2003] HCATrans 458 at 6469-6484. 71 See Crimmins v Stevedoring Industry Finance Committee (1999) 200 CLR 1 at 34 Kirby appropriate in the circumstances for the Supreme Court to grant such relief? The common law and escape from custody: What light, if any, does the common law throw on the meaning of "immigration detention" and the entitlement of a detainee to leave such "detention" to avoid allegedly inhuman and intolerable conditions? The constitutional necessity of a federal source and judicial order for punishment: What light does the Constitution throw on, or what meaning does the Constitution require of, the phrase "immigration detention" in s 197A of the Act, for an offence against which the appellant has been charged? International law and arbitrary detention: What light, if any, do the obligations assumed by Australia under international law throw on the meaning of "escape" and "immigration detention" in s 197A? Exhausting alternative remedies: Is it an answer to the complaints of the appellant concerning the allegedly inhuman and intolerable conditions of his "immigration detention" that he may bring proceedings for relief under administrative law, or for civil wrongs, but not a challenge to the validity and lawfulness of his "detention"? An arguable "defence" under the Act: In the light of the resolution of the foregoing issues, does the appellant have an arguable defence to the charge under s 197A of the Act, based on the conditions of his immigration detention, so that he is entitled, in principle, to obtain the evidence directed to that defence as sought in the witness summonses? The argument of oppression and remitter: If the answers to the foregoing issues are favourable to the appellant, are the witness summonses in their terms oppressive, entitling the respondents, on their notice of contention, to relief on that ground? If it be necessary to decide this issue, should it be determined by this Court or by the Supreme Court? Approach to the claim for summary relief The decision of the Chief Magistrate the present proceedings was one occasioned by the application for the respondents seeking, in effect, summary relief against the witness summonses. Four points need to be made in relation to this issue. They are significant for the conclusion that I will ultimately reach. triggered that Disadvantages of interlocutory appeals: This Court has repeatedly affirmed that it is ordinarily undesirable that the course of a criminal trial should Kirby be interrupted by interlocutory appeals72. Even where the point in issue is legally important and arguable, where its resolution might save time or affect other persons or result in a termination of the trial, reasons of principle normally demand that appellate interlocutory intervention be refused73. In part, this approach is taken to avoid oppression of individuals by interlocutory appeals brought by the prosecution or misuse of criminal process by well-resourced litigants who prolong proceedings without real merit. In part, it arises because of the law's experience that many interlocutory issues resolve themselves in the course of a trial74. Normally, such issues are resolved more satisfactorily on the basis of findings based on evidence rather than holdings made on hypotheses adopted in advance of the evidence. The course adopted by the respondents in this case, in interrupting the trial of the appellant, arguably denied this Court a proper evidentiary foundation upon which to rest conclusions of significance for the meaning of the Act and the operation of the Constitution upon the Act. A majority of this Court now reaches its conclusion without having the desirable evidentiary foundation in the primary court, which is the way this Court has repeatedly said cases of the present kind should ordinarily be decided. Restraint in peremptory relief: The peremptory relief sought by the respondents was governed by established principles that insist upon restraint on the part of judges exercising such jurisdiction whether by way of appeal or judicial review. Such restraint, which applies to civil as well as criminal applications, arises from a number of considerations, some of them already mentioned. Rulings on the availability of a legal action or defence are normally better made by courts when any evidence, said by the party propounding the action or defence, has been adduced. Legal issues are rarely, if ever, wholly disjoined from facts. Facts cast light upon the operation of the law. Factual merits are not irrelevant to the way courts, which are sworn to do justice, respond to alternative elaborations of the law. It is futile to suggest that the substance of law is somehow disconnected from facts. Because, under the rule of law, parties propounding serious actions or defences are normally entitled to have their day in court, it is exceptional to stop them in their tracks on the footing that they have no arguable cause of action or no arguable defence. The exceptional character of the relief sought at trial in the 72 eg Smith v The Queen (1994) 181 CLR 338 at 346; Director of Public Prosecutions (SA) v B (1998) 194 CLR 566 at 591-593. 73 eg R v Elliott (1996) 185 CLR 250 at 257. 74 In re the Will of F B Gilbert (dec’d) (1946) 46 SR (NSW) 318 at 323. Kirby Magistrate's Court was doubled when the respondents lost the application there, interrupted the trial further and renewed their demand in the Supreme Court. To the extent that discretionary considerations and considerations involving the evaluation of complex materials were found in the Magistrate's Court to support the matter proceeding in the normal way, these were added reasons for restraint on the part of the primary judge. The Full Court was bound to observe and uphold such restraint. The approach to be taken to the application made by the respondents before the Chief Magistrate is not in doubt. It is established by analogy to the approach taken by this Court in many cases75. In Dey v Victorian Railways Commissioners76, Dixon J explained that a "case must be very clear indeed to justify the summary intervention of the court to prevent a plaintiff submitting [the plaintiff's] case for determination in the appointed manner by the court with or without a jury". A similar insistence on "great care" before denying a party the "opportunity for the trial of [the party's] case by the appointed tribunal" was voiced by Barwick CJ in General Steel Industries Inc v Commissioner for Railways (NSW)77. The foregoing words, expressed in the context of civil proceedings, have added force in a case such as the present. Here, what is at stake is the right of the appellant to defend himself against an indictable criminal charge. Ordinary principles suggest an added requirement of caution before preventing such a person obtaining evidence, as he is advised, in order to establish matters relevant to his resistance to the charge. This is especially so where the "defence" propounded amounts, in effect, to a challenge to the capacity of the prosecution to prove an essential element of the offence charged against him78. It is true that argument, "perhaps even of an extensive kind, may be necessary to demonstrate that" the issue to which the evidence is directed "is so clearly untenable that it cannot possibly succeed"79. However, it is the repeated instruction of this Court that peremptory relief of the kind sought by the 75 eg Dey v Victorian Railways Commissioners (1949) 78 CLR 62; General Steel Industries Inc v Commissioner for Railways (NSW) (1964) 112 CLR 125; Jackamarra v Krakouer (1998) 195 CLR 516 at 529 [35]. 76 (1949) 78 CLR 62 at 91. 77 (1964) 112 CLR 125 at 130. 78 Namely "escape from immigration detention". See the Act, s 197A. 79 General Steel (1964) 112 CLR 125 at 130. Kirby respondents in the present case "must be sparingly exercised"80. As McHugh J has explained, in relation to a civil case, "the mere fact that the plaintiff's prospects of success are slim is not enough to strike out a pleading"81. A fortiori, the mere fact that the arguments of a defendant in a criminal proceeding present novel and difficult issues is not enough to strike out the process that seeks to adduce evidence propounded as evidence to resistance to the charge. In our legal system, the proper place and time to resolve novel and difficult questions of law in such matters is normally in the trial and the regular appellate system after trial. It is not in interlocutory process82. Special restraint in new areas of law: This is not to deny that proper cases will exist where a firm conclusion may be reached with reasonable efficiency and on limited materials that the propounded action or defence is "doomed to fail". However, where the law is uncertain, where it is in a "state of transition"83 and (I would add) where the resolution concerns aspects of fundamental human rights and criminal liability, the restraints normally applicable to applications for summary relief are enlarged. This is because of the "undesirability of courts attempting to formulate legal rules against a background of hypothetical facts" involving "the potential unfairness to [parties] if their cases were finally ruled upon before they were able, with the benefit of [court procedures], to refine their factual allegations"84. Like judges who have gone before (and in much simpler cases) "I share the unease … at deciding questions of legal principle without knowing the full facts"85. Evidentiary foundation for bona fides: Enough facts were adduced before the Chief Magistrate to demonstrate, in the words of Bleby J in the Full Court, that "the issues concerned are of importance … in the operation of the [Act]"86. 80 Esanda Finance Corporation Ltd v Peat Marwick Hungerfords (1997) 188 CLR 81 Esanda (1997) 188 CLR 241 at 271. 82 See Fejo v Northern Territory (1998) 195 CLR 96 at 122 [29], 134-135 [66]-[67]. 83 E (A Minor) v Dorset County Council [1995] 2 AC 633 at 694; Woolcock Street Investments Pty Ltd v CDG Pty Ltd (2004) 78 ALJR 628 at 654 [138]; 205 ALR 84 E (A Minor) [1995] 2 AC 633 at 693 per Sir Thomas Bingham MR, citing argument recorded in Lonrho Plc v Fayed [1992] 1 AC 448 at 469-470. 85 E (A Minor) [1995] 2 AC 633 at 693 per Sir Thomas Bingham MR. 86 Behrooz (2003) 84 SASR 479 at 480 [11]. Kirby With respect, in the Supreme Court only Bleby J adopted the correct legal approach to the application mounted by the respondents. However, although the appellant was deprived by the resolution of that application of the full evidentiary foundation he sought for his arguments, there was sufficient evidence before the Chief Magistrate to make it clear that the appellant was not wasting the time of the courts. He was propounding a serious and potentially important issue to be tried. It is true that much of the material filed by the appellant in the Magistrate's Court was not specifically related to Woomera87. Some of it was "vague"88 and addressed to times distant from the appellant's alleged "escape"89. Some was from sources not wholly independent and dispassionate. However, the appellant fairly pointed out that this was inherent in denying him access to recorded and official material specific to complaints and investigations concerning conditions in Woomera at the time of his alleged offence. For all that, there remained a considerable body of disturbing evidence, assembled for the appellant's case, from which inferences might be drawn that the conditions of supposed "detention" in which he was kept were inhuman and intolerable. I will not repeat all of this evidence, necessarily untested at this stage of the proceedings. But it includes that included in an address by Professor Richard Harding, Inspector of Custodial Services in Western Australia, based on an inspection of the Curtin Detention Centre in Western Australia which, as he put it, like that at Woomera, was "in the middle of nowhere"90. Professor Harding described the conditions that he had seen as "an absolute disgrace": involving gross overcrowding, broken toilets, unprivate conditions, lack of medical and dental facilities, combining with a situation at Curtin said to be "almost intolerable" and a statement that such "evidence as exists indicates things are little better at the other Centres"91. 87 Behrooz (2002) 84 SASR 453 at 467 [48]. 88 Behrooz (2002) 84 SASR 453 at 470 [64]. 89 Behrooz (2002) 84 SASR 453 at 470 [64]. 90 Harding, "Standards and Accountability in the Administration of Prisons and the International Immigration Detention Centres", unpublished speech Corrections and Prisons Association Conference, Perth, 30 October 2001 ("Harding"). The conclusions are cited by the primary judge: Behrooz (2002) 84 SASR 453 at 467 [49]-[50]. 91 Harding, cited in Behrooz (2002) 84 SASR 453 at 467-468 [50]. Note that this statement was misquoted in the reasons of the primary judge as "things are a little better at other centres" (emphasis added to identify misquotation). Kirby A detailed newspaper report describes what is said to have been the unanimous advice to the Minister for Immigration calling for the closure of Woomera and other measures to help avert a "human tragedy of unknowable proportions"92. This report, based on the opinion of the Immigration Detention Advisory Group whom the Minister reportedly called in to negotiate with hunger-strikers at Woomera, demanded an end to the "demonisation" of the detainees. Another report recounts reports of suicide, hunger-strikes and self- harm93. The report states that "[a]lmost every day, asylum seekers inside [Woomera] cut and slash their bodies, drink shampoo or try to hang themselves. But mostly they are ignored". A psychiatric nurse is quoted in the report as stating that the detainees felt they "were treated like animals … medication [was] fed through wire mesh to detainees and [there was] a pervasive belief that suicide was the only way out". According to this nurse, "Woomera is a totally traumatising, alienating experience because they are not treated with humanity"94. Particularly distressing is the recorded description of the alleged treatment of children kept in detention, one of whom, detained at Woomera, reportedly went mute for a time in apparent reaction to his experiences95. Conclusion: available inferences: The materials adduced before the Magistrate's Court are far from perfect. However, given the limitations upon the gathering of evidence, in default of court-assisted process, they sufficiently answer any suggestion that the contentions made for the appellant concerning the conditions of his detention at Woomera before his "escape" were factually unarguable and groundless. If it could be shown that conditions such as those described existed and were legally relevant to the charge which the appellant faced, enough was before the Chief Magistrate to support his conclusion that the appellant should have the opportunity to procure relevant evidence96. Courts in other lands might turn a blind eye to such materials. But the independent courts of the Australian Judicature are not so indifferent to such evidence as to reject the inferences that reasonably arise from it97. 92 The Age, 29 January 2002 at 1, cited in Behrooz (2002) 84 SASR 453 at 468 [53]. 93 The Age, 24 April 2002, cited by the primary judge: Behrooz (2002) 84 SASR 453 94 Cited in Behrooz (2002) 84 SASR 453 at 468-469 [54]. 95 Australian Broadcasting Corporation, Asylum Seekers in Detention: Health Report, 13 August 2001, in evidence below. 96 See Carter v Hayes SM (1994) 61 SASR 451. 97 See Rasul v Bush 72 USLW 4596 (2004). Kirby The common law and escape from custody Common law and prisoners' escapes: From before the time of Hale's Pleas of the Crown98, the common law has generally resisted the notion that conditions in prison, even if extreme, afford a legal excuse to a prisoner for effecting an escape. In People v Whipple99, Houser J, citing Hale's work, stated100: "[I]t is said that 'if a prison be fired by accident, and there be a necessity to break prison to save his life, this excuseth the felony'. The sole authority for such declaration of the common law is Coke's Second Institutes, 590, where, without the citation of either judicial or other authority in its support, the statement occurs that if 'a man imprisoned for petit larceny or for killing of a man se defendendo, or by misfortune, and break prison, it is no felony, because he shall not for the first offense subire judicium vitae vel membri. Et sic de similibus'. But whatever may be the common law with reference to escape, where either 'se defendendo', misfortune, or 'first offense' is or may be invoked as a defense to the accusation for which imprisonment has resulted, so far as the decisions by the courts of sister states are concerned, neither the insanitary condition of the jail101, fear of violence from third persons102, nor unmerited punishment at the hands of the custodian103 will present a situation which in the law may be accepted as an excuse for violation of the statute. In the case of State v Cahill104, the defendant was charged with escaping from a solitary cell of the penitentiary, rather than from the prison itself. He presented the defense that while in solitary confinement his food consisted of an insufficient quantity of bread and water; that the cell was infested with bugs, worms, and vermin; that the toilet was so out of repair that when it was flushed the water ran out upon the floor; that the 98 (1736) vol 1 at 611. 100 279 P 1008 at 1009 (1929). 101 State v Davis 14 Nev 439 (1880); 33 Am Rep 563 (1880). 102 Hinkle v Commonwealth 66 SW 816 (1902). 103 Johnson v State 50 SE 65 (1905). 104 194 NW 191 at 193 (1923). Kirby cell was without a chair, bed, or other reasonable comforts. He further claimed that he had been suffering from lung trouble, and that the cell was rendered unhealthful by the conditions existing and the manner in which it was kept. In deciding the particular question of whether such conditions would constitute a defense to the crime of escape, the court, in part, said: 'The quantity of bread furnished appellant was inadequate if the confinement was protracted over many days, but neither this nor the other matters complained of afforded him the slightest justification for escaping from the cell, or attempting to secure his liberty from confinement.'" I accept this statement of the common law as applicable to Australia. Decisions given in more recent times in this country105 and in the House of Lords106 add strength to it as an accurate exposition of the law's approach. So do the reasons of policy mentioned in Whipple. These include the inadmissibility of allowing "a prisoner to decide whether the conditions justify him in attempting to escape", a prospect destructive of prison discipline and inviting a danger of the "slaying or serious wounding" of officers, guards and other prisoners that might arise from resisting attempts at escape107. The appellant did not challenge this line of legal authority. Nor did he seek to invoke the defence of necessity, applicable, for example, where a person (out of necessity) breaks free from a prison which is on fire108. Instead, the appellant's argument met this line of authority head-on. He distinguished the requirement of a prisoner serving a lawful sentence following conviction of a criminal charge, as punishment imposed by a court of law and his own situation as a person merely confined to an administrative status, namely "immigration detention", and then pursuant to an Act of Parliament without any conviction, judicial order or proof of an offence. Answering a statutory question: I accept the appellant's argument that the issue presented by the case he seeks to bring in answer to the charge against him under s 197A of the Act is not resolved by considerations of the common law. It is a statutory question. It presents issues concerned with the meaning of words in an Australian statute ("escape" and "immigration detention") enacted by the Federal Parliament, as understood having regard to the provisions of the Constitution. 105 Prisoners A-XX Inclusive v State of NSW (1995) 38 NSWLR 622. 106 R v Deputy Governor of Parkhurst Prison; Ex parte Hague [1992] 1 AC 58. 107 Whipple 279 P 1008 at 1010 (1929). 108 Whipple 279 P 1008 at 1009 (1929), citing Hale's Pleas of the Crown (1736) vol 1 Kirby In Whipple, the judges109 were asked only to say whether positive law excused or justified the escape of the prisoner in that case from his confinement following a criminal conviction and therefore warranted the conclusion that the instruction given to the jury in that case had been erroneous. The appellate judges reached their conclusion "with very great reluctance". They did so only because of what they took to be the state of "the established law"110. They acknowledged that "if the facts were as stated by the defendant, he was subjected to brutal treatment of extreme atrocity"111. They felt unable to find legal error. However, the issue in Whipple was not the issue raised in these proceedings. From first to last that issue concerns the meaning and operation of a provision in a law enacted by the Parliament. Upon that question statements about the common law, and indeed the provisions of constitutional protections in other countries112, are of little assistance. Whatever such authorities may say, the question for us remains whether, at a certain point, it is reasonably arguable that intolerable conditions of custody, if proved to exist in his "immigration detention", would provide the appellant with a lawful answer to a charge brought against him under s 197A of the Act. The other members of this Court are of the opinion that it is not reasonably arguable that they would. I am of the opposite opinion. Three considerations, two of them deriving from the Australian Constitution and one from international law, lead me to my result. The constitutional necessity of a federal source Judicial determination of the law: The first step in deciding questions of constitutional validity of federal legislation is to construe the statutory provisions113. This is a course common to constitutional courts everywhere. It 109 Houser J (Conrey PJ and York J concurring). See Whipple 279 P 1008 at 1009, 110 Whipple 279 P 1008 at 1010 (1929). 111 Whipple 279 P 1008 at 1010 (1929). 112 See, for example, joint reasons at [54]-[56]; reasons of Callinan J at [222]. 113 Bank of NSW v The Commonwealth (1948) 76 CLR 1 at 185-186 per Latham CJ; R v Hughes (2000) 202 CLR 535 at 565-566 [66]; Residual Assco Group Ltd v Spalvins (2000) 202 CLR 629 at 662 [81]. Kirby sometimes provides a complete answer to a legal question, without the need to resort to constitutional invalidation114. In Australia, it is basic to the operation of a statute affording powers to the Executive Government of the Commonwealth that the law cannot "have the effect of making the conclusion of the legislature final and so the measure of the operation of its own power"115. The Parliament is not able to recite itself into power by declaring the existence of a constitutional fact comprising an actual and factual connection between the law and the subject matter upon which the law operates116. The existence, or absence, of such a fact can only be decided, in case of dispute, by In Australian Communist Party v The Commonwealth ("Communist Party Case"), Williams J made this point succinctly117: judiciary. the "[I]t is clear to my mind that it is the duty of the Court in every constitutional case to be satisfied of every fact the existence of which is necessary in law to provide a constitutional basis for the legislation". This, then, is the "axiom" of judicial review which derives from the structure of the Constitution and the separation of the judicial power which the Constitution establishes118. Only the judiciary, and ultimately this Court, can determine whether a power sought to be exercised by the Federal Parliament was in fact conferred on it by the Constitution. When the meaning of "immigration detention" as appearing in s 197A of the Act is in question (as it is in the present case) it is not for the Parliament to state conclusively what it means. That function is the responsibility of the courts, ultimately this Court. By established constitutional doctrine, and more recently with encouragement from the Parliament itself119, this Court, in the event of 114 As it does in the companion proceedings in Al-Kateb [2004] HCA 37 and Al Khafaji [2004] HCA 38. See also Zadvydas v Davis 533 US 678 at 689 (2001). 115 Australian Communist Party v The Commonwealth ("Communist Party Case") (1951) 83 CLR 1 at 193 per Dixon J, 206 per McTiernan J, 263 per Fullagar J. See also Re Wakim; Ex parte McNally (1999) 198 CLR 511 at 602 [193]. 116 Communist Party Case (1951) 83 CLR 1 at 193. 117 (1951) 83 CLR 1 at 222. 118 Winterton, "The Significance of the Communist Party Case", (1992) 18 Melbourne University Law Review 630 at 650. 119 The Act, s 3A. See also Acts Interpretation Act 1901 (Cth), s 15A. Kirby doubt, will prefer a construction of a disputed legislative text that ensures that it remains within its constitutional powers to one that would involve the law travelling beyond the powers that belong to the Parliament120. Thus a Minister may assert that a fact exists, such as the fact that the appellant was in "immigration detention" at the time that he "escaped". But that assertion is not, and cannot be, conclusive in Australian law. Nor can an Act of Parliament make it conclusive. It cannot do so by the use of preambles (as in the Communist Party Dissolution Act 1950 (Cth)). Nor can it do so by the use of statements of objects, or of definitions (as in the Act in question here). As Fullagar J explained in the Communist Party Case121: "The validity of a law or of an administrative act done under a law cannot be made to depend on the opinion of the law-maker, or the person who is to do the act, that the law or the consequence of the act is within the constitutional power upon which the law in question itself depends for its validity. A power to make laws with respect to lighthouses does not authorize the making of a law with respect to anything which is, in the opinion of the law-maker, a lighthouse." The assertion by a Minister or by officials or others performing the work of Executive Government that a person was at a relevant time in "immigration detention" cannot be conclusive of that fact. To paraphrase the words of Kitto J in the Communist Party Case, such a construction would mean that it is "impossible to attribute to the legislation any other [conclusion] than that [the Executive] may exercise [its] power [to detain] with complete immunity from judicial interference"122. To avoid such a result, incompatible with the assumption of the rule of law upon which the Constitution is drawn, the assertion is not conclusive. It remains for a court (ultimately this Court) to declare whether the Act applies to the established facts proved in the particular circumstances of the case. Examinability of executive assertions: This is a powerful reason for rejecting the respondents' argument that s 197A of the Act applied to the appellant simply because he was in Woomera at the time he "escaped". The 120 See The Commonwealth v Tasmania (The Tasmanian Dam Case) (1983) 158 CLR 1 at 161-167. See also Jumbunna Coal Mine NL v Victorian Coal Miners' Association (1908) 6 CLR 309 at 364; Ex parte Walsh and Johnson; In re Yates (1925) 37 CLR 36 at 93; Attorney-General (Vict) v The Commonwealth (1945) 71 CLR 237 at 267. 121 (1951) 83 CLR 1 at 258 (emphasis added). 122 (1951) 83 CLR 1 at 280. Kirby appellant wishes to assert that the conditions in Woomera did not, at the time of his "escape" amount to "immigration detention" of the kind for which the Parliament provided in the Act. If need be, the appellant wishes to contend that an attempt to provide a form of administrative restraint, called "immigration detention", that involved inhuman and intolerable conditions would exceed the powers afforded to the Parliament by the Constitution123. Only a court could determine such issues. A court would do so in the normal way by the application of the law to the facts proved in the evidence. Under our Constitution, it would not do so simply by accepting the assertion of the Minister or proof that at some earlier time the appellant had arrived in Australia as an "unlawful non-citizen" and for that reason had been taken into "immigration detention". I agree in this respect with the joint reasons in Attorney-General (WA) v Marquet124: "[Australian] constitutional norms accord an essential place to the obligation of the judicial branch to assess the validity of legislative and executive acts against relevant constitutional requirements. As Fullagar J said, in Australian Communist Party v The Commonwealth, 'in our system the principle of Marbury v Madison is accepted as axiomatic'. It is the courts, rather than the legislature itself, which have the function of finally deciding whether an Act is or is not within power." By parity of reasoning, it is the courts, rather than the legislature itself, that have the function of deciding finally whether disputed facts enliven a statutory provision. Where a law, otherwise understood, would exceed the applicable constitutional powers of the Parliament, this Court in discharge of its own functions, will read down that law or hold it invalid to any extent necessary125. If, therefore, on its true construction, s 197A purported to mean that this Court could not determine the meaning of "immigration detention", and therefore that it was not open to this Court to find that certain extreme conditions fell outside "immigration detention" as provided by the Parliament, such meaning would exceed the limits of legislative and executive power under the Constitution. It would contradict the basic function of the judiciary to decide such questions authoritatively. As explained above126, s 197A should be read so 123 Constitution, s 51(xix) ("aliens"). See also s 51(xxvii) ("immigration and emigration"). 124 (2003) 78 ALJR 105 at 116 [66]; 202 ALR 233 at 248 (footnotes omitted). 125 R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 at 267- 278 per Dixon CJ, McTiernan, Fullagar and Kitto JJ; Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476 at 513-514 [104]. 126 These reasons, above at [109]. Kirby that it conforms with the Constitution. Therefore, s 197A should not be read so as to prevent this Court from determining the meaning of "immigration detention". It presents a question, examinable by the courts, as to whether, in a given case, particular conditions, proved by evidence, amount to "immigration detention" for the purpose of the offence there provided or not. The contrary cannot be asserted consistently with the limited powers of the Parliament and in declaring conformity, or Executive and disconformity, with constitutional powers. the function of the courts To the extent that there is any ambiguity in the language of s 197A of the Act, the section should be read as permitting the appellant to challenge, in the way he proposes, the application of the section to the facts concerning him. To allow this follows from the requirement explicit in the section that the place from which the appellant "escaped" should answer to the statutory description of "immigration detention". It also follows implicitly from the constitutional necessity I would call "proportionality"127) between the propounded heads of constitutional power128, necessary to the validity of the section, and the statutory provision for detention of persons such as the appellant. to demonstrate a valid connection (which Putting it quite simply, whereas, as this Court has held129, the constitutional head of power supports the administrative confinement of a person such as the appellant in "immigration detention", implicitly under reasonable and humane conditions, it would not support his prolonged confinement in inhuman and intolerable conditions. If that form of confinement were attempted in Australia it would be unlawful. It would be contrary to the Constitution. To the extent that the appellant could prove that the conditions in Woomera before his "escape" were inhuman and intolerable, he could avail himself not only of an argument arising out of the meaning of s 197A of the Act but also of a constitutional argument that any other meaning would undermine the validity of the section under the Constitution. The constitutional necessity of a judicial order for punishment Punishment only by judicial order: This last observation leads to a second way of demonstrating that the appellant's "defence" is reasonably arguable. It 127 Levy v Victoria (1997) 189 CLR 579 at 645-646. See also Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 561-562. 128 Principally the power to make laws with respect to "aliens". See Constitution, s 51(xix). 129 Lim (1992) 176 CLR 1. Kirby has exactly the same consequence. It provides support for a construction of s 197A of the Act that would permit the appellant to prove that the conditions of his custody immediately prior to his "escape" were so inhuman and intolerable as to amount to "punishment". Not only would this conclusion arguably take the conditions of his custody outside the description of "immigration detention" as the Parliament provided under the Act. Under the Constitution, it would also arguably threaten the validity of ss 197A and 198 in their application to the appellant. This is because, under federal law, the infliction of punishment, as such, is reserved by the Constitution to the judiciary. It cannot be imposed, as such, by the legislature or the executive government. Such a point was made clear by this Court in Chu Kheng Lim v Minister for Immigration130. As the joint reasons in that case explained131: "… [T]he two sections [of the Act as it then stood] will be valid laws if the detention which they require and authorize is limited to what is reasonably capable of being seen as necessary for the purposes of deportation or necessary to enable an application for an entry permit to be made and considered. On the other hand, if the detention which those sections require and authorize is not so limited, the authority which they purportedly confer upon the Executive cannot properly be seen as an incident of the executive powers to exclude, admit and deport an alien. In that event, they will be of a punitive nature and contravene Ch III's insistence that the judicial power of the Commonwealth be vested exclusively in the courts which it designates." If, by evidence, the appellant could demonstrate that the conditions in which he was held at Woomera immediately before he left that place passed beyond the language of the Act ("immigration detention") and the purposes for which the Parliament had provided in the Act for detention (holding, processing, admitting or expelling "unlawful" alien entrants) he would have a reasonable argument that his custody not only fell outside the "immigration detention" for which the Parliament had provided. It would also fall outside any such administrative detention for which the Parliament could provide, without the prior authorisation of a judicial order. 130 Lim (1992) 176 CLR 1. 131 Lim (1992) 176 CLR 1 at 33 per Brennan, Deane and Dawson JJ. See also Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51 at 97, 131. Kirby Inhuman conditions as punishment: This is a point that distinguishes the issue which the appellant sought to raise from those considered under the common law cases or in jurisdictions where a constitutional norm such as that he invoked is unavailable. It may be accepted that detention of illegal alien entrants to Australia is a burden on their liberty. However, as such, it is not "punishment" of the kind reserved under federal law to the consequences of a judicial order. It may also be allowed that, in federal law, the categories of "exceptional cases", involving involuntary detention without a judicial order132, are not forever closed133. They certainly extend beyond the "exceptional cases" mentioned in Lim. Nevertheless, the basic rule established by Lim remains true today. That case holds that normally "the involuntary detention of [an individual] in custody by the State is penal or punitive in character and, under our system of government, exists only as an incident of the exclusively judicial function of adjudging and punishing criminal guilt"134. It is one thing to establish, and enforce, a form of administrative custody for the detention of aliens unlawfully entering Australia and for the limited purposes envisaged by the Act. Arguably, it is quite a different thing, outside the Act and beyond constitutional power, to subject such an alien as a detainee to inhuman and intolerable conditions. If such conditions could be proved by evidence, it would be reasonably arguable, as a matter of statutory construction, that "escape" from them was not escape from "immigration detention", as enacted and as constitutionally permitted. Arguably, it would be no more an "escape" from "immigration detention" than it would be for the detainee to "escape" from equivalent inhuman and intolerable conditions into which the detainee had been illegally confined in a wholly private detention facility falling outside the Act. Or in an offshore cage selected in the vain hope of avoiding accountability to the standards of Australian law135. On such issues, the designation of the detention facility and the name on the gate could be no more determinative of its statutory and constitutional character than was the name on the gate of the facilities established by oppressive regimes. What matters, in our system of law, is the legal and constitutional character of the "detention". That character is not decided finally by the name 132 eg Committal without bail awaiting trial; quarantine against infectious diseases; detention on account of mental illness; infliction of discipline by military tribunals; and possible powers of detention in wartime. See Lim (1992) 176 CLR 1 at 28. 133 Lim (1992) 176 CLR 1 at 55; Kable (1996) 189 CLR 51 at 121; Kruger v The Commonwealth (1997) 190 CLR 1 at 162. 134 Lim (1992) 176 CLR 1 at 27. 135 See Rasul v Bush 72 USLW 4596 (2004). Kirby that the Parliament adopts or the description which the Executive asserts. It is decided by courts of law applying legal standards to proved evidence. That is why the decision to prevent the appellant from adducing the evidence that he has propounded, in resistance to the charge brought against him, was legally erroneous. Proof that "punishment" was lawfully inflicted under a valid order of a criminal court might indeed prevent examination of the character and incidents of the punishment that followed, so long at least as it could possibly answer to the description of "imprisonment". But that answer was not available in the present case. Here, there was no judicial order of punishment. There was no judicial order of commitment to imprisonment. An assertion that the true character of the "detention" imposed on the appellant was a form of punishment (permitted, if at all, under the Constitution "only as an incident of the exclusively judicial function of adjudging and punishing criminal guilt"136) presented a reasonably arguable allegation that could only be decided by a court acting on evidence. The appellant was therefore entitled to secure evidence addressed to that issue. He was wrongly deprived of that evidence. International law and arbitrary detention Relevant provisions of international law: A still further consideration reinforces the foregoing conclusions. It is derived from international law binding on Australia pursuant to the provisions of the International Covenant on Civil and Political Rights ("ICCPR")137. Australia is a party to that treaty and to the First Optional Protocol that supplements it138. The latter renders Australia accountable to the UNHRC for derogations from its obligations under the ICCPR. The influence of the ICCPR on the development of Australian law was explained by this Court in Mabo v Queensland [No 2]139. Leaving aside the contested question of whether the Constitution may be construed by reference to 136 Lim (1992) 176 CLR 1 at 27. 137 Done at New York on 19 December 1966, [1980] Australian Treaty Series No 23. See Nowak, UN Covenant on Civil and Political Rights: CCPR Commentary 138 First Optional Protocol to the International Covenant on Civil and Political Rights, done at New York on 19 December 1966, [1991] Australian Treaty Series No 39. 139 (1992) 175 CLR 1 at 42. See also Minister for Immigration and Ethnic Affairs v Teoh (1995) 183 CLR 273 at 287-288; AMS v AIF (1999) 199 CLR 160 at 180 Kirby international law140, it has long been established by the authority of this Court that statutes are to be interpreted and applied so as to be in conformity with international law141. The presumption of compliance applies "as far as [the] language [of the statute] permits"142. However, that is true of all rules for the construction of legislation where language necessarily takes primacy. Ambiguity in the written law will often stimulate consideration of the requirements of international law143. It is not in my view essential to demonstrate ambiguity in the meaning of the provision of a statute before this canon of construction may be applied144. If the language permits an interpretation that is consistent with international law, that is the construction that should be favoured by Australian courts. I take this to be uncontroversial where, as here, the relevant federal statutory provision (s 197A) was enacted after the ICCPR was signed and ratified by Australia145. The interpretive principle applies equally to customary international law and treaty law. The ICCPR is a particularly relevant source of international law because Australia has voluntarily accepted the obligations expressed in it, and in the Protocol. It must therefore be taken to have accepted the obligation to ensure that its enacted laws conform to the requirements of the ICCPR. It is also particularly relevant because Australia has submitted itself to the scrutiny of the UNHRC on alleged infractions of such obligations. Whilst the views of the 140 See Newcrest Mining (WA) Ltd v The Commonwealth (1997) 190 CLR 513 at 657- 661; Kartinyeri v The Commonwealth (1998) 195 CLR 337 at 383-386 [95]-[101], 417-419 [166]-[167]; Re East; Ex parte Nguyen (1998) 196 CLR 354 at 380-381 [68]; Austin v The Commonwealth (2003) 77 ALJR 491 at 543-544 [257]; 195 ALR 141 Dating back to Jumbunna Coal Mine (1908) 6 CLR 309 at 363 per O'Connor J. See also Kartinyeri (1998) 195 CLR 337 at 384 [97] per Gummow and Hayne JJ. 142 Teoh (1995) 183 CLR 273 at 287; Kartinyeri (1998) 195 CLR 337 at 384 [97], 386 [101]; AMS v AIF (1999) 199 CLR 160 at 180 [50]. 143 See, for example, The Commonwealth v Yarmirr (2001) 208 CLR 1 at 130 [292]; Regie Nationale des Usines Renault SA v Zhang (2002) 210 CLR 491 at 544-545 [150]; Western Australia v Ward (2002) 213 CLR 1 at 242 [566]. 144 See Lacey, "Judicial Discretion and Human Rights: Expanding the Role of International Law in the Domestic Sphere", (2004) 5 Melbourne Journal of International Law 108 at 127-129. 145 s 197A of the Act was inserted in 2001: Migration Legislation Amendment (Immigration Detainees) Act 2001 (Cth). See Teoh (1995) 183 CLR 273 at 288; Plaintiff S157/2002 (2003) 211 CLR 476 at 492 [29]. Kirby UNHRC do not constitute decisions that are legally binding upon the "State party concerned"146, they are entitled to close attention by courts such as this, as the Privy Council remarked in Tangiora v Wellington District Legal Services Committee147. Reflecting rights long recognised and protected by the common law and earlier recognised in the Universal Declaration of Human Rights148, the ICCPR contains provisions relevant to the detention of "unlawful non-citizen[s]" under the Act149 and the conditions in which (and time during which) such persons might be so detained. Relevant requirements are found in Art 9 of the ICCPR. This is concerned with the right to liberty and security of the person and the right to be exempt from arbitrary detention and to bring proceedings without delay in respect of the lawfulness of detention. Article 10(1) of the ICCPR contains the requirement that persons deprived of their liberty must "be treated with humanity and with respect for the inherent dignity of the human person". By Art 7 it is provided that "[n]o one shall be subjected to torture or to cruel, inhuman or degrading treatment or punishment". Both by the common law, and by force of such provisions of international law, infringement of these rights is not lawful in this country unless sustained by "a clear expression of an unmistakable and unambiguous intention" in valid legislation150. 146 McGoldrick, The Human Rights Committee: Its Role in the Development of the International Covenant on Civil and Political Rights, (1994) at 151 [4.39]. 147 [2000] 1 NZLR 17; [2000] 1 WLR 240 at 244-245. See also Minister for Immigration and Multicultural and Indigenous Affairs v B (2004) 78 ALJR 737 at 764 [148]; 206 ALR 130 at 167. Cases from other jurisdictions referring to the views of the UNHRC include: Legality of the Threat or Use of Nuclear Weapons (Advisory Opinion) (1996) ICJ 226 at 507, 578; Kurt v Turkey (1998) 27 EHRR 373 at 397-399, 414-415, 435-436; Matadeen v Pointu [1999] 1 AC 98 at 115-116; Knight v Florida 528 US 990 at 996 (1999); Reyes v The Queen [2002] 2 AC 235 at 255-256 [41]; Suresh v Canada (Minister of Citizenship and Immigration) [2002] 1 SCR 3 at 40-41 [66]-[67]. 148 General Assembly Resolution 217(III)(A) of 10 December 1948. See also Charter of the United Nations, signed at San Francisco on 26 June 1945, Arts 1(3), 55, 56. 149 The Act, ss 189, 196. 150 Coco v The Queen (1994) 179 CLR 427 at 438; Daniels Corp International Pty Ltd v Australian Competition and Consumer Commission (2002) 213 CLR 543 at 553 [11] per Gleeson CJ, Gaudron, Gummow and Hayne JJ, 562-563 [43] per McHugh J, 580-582 [103]-[106] of my own reasons. Kirby When, therefore, in respect of unlawful non-citizens within Australia, the Act permits derogations from personal freedom, and authorises a form of administrative custody called "immigration detention", it will be presumed (in the absence of clear statutory provisions to the contrary151) that what the Parliament has provided for is, and is only, a form of "detention" that complies with the norms stated in the ICCPR, relevantly, Arts 7, 9 and 10. Application of ICCPR to the Act: To take a clear example, the imposition of physical or mental torture as a regular incident of "immigration detention" could never be necessary or appropriate for administrative custody of that kind152. The fact that, if it existed, it would breach Art 7 of the ICCPR assists an Australian court such as this to arrive at that conclusion. Similarly, if the conditions of "detention" were to take on an attribute, or character, of retribution or punishment for the deterrence of other would-be "unlawful" aliens tempted to enter Australia without authority, this too would contravene the ICCPR. In default of a judicial order, the imposition of such punitive measures could not, conformably with the Constitution, exist based upon the operation of the Act so far as it provides for "immigration detention". The provisions of the ICCPR reinforce the conclusion to which, in any case, this Court's decision in Lim would lead. Immigration detention, as such, must not be punitive. Even more clearly, it must not involve conditions that are inhuman and intolerable153. The respondents themselves accepted that the Act did not authorise inhuman and intolerable conditions in immigration detention. That concession properly recognises the need to read the Act in a way that avoids an operation of federal law that would conflict with international law. However, once that concession is made, a party with a serious claim of a breach of international law must be in a position, on that basis and without delay, to contest the lawfulness of any detention alleged to contravene such standards154. As the appellant accepted, and HREOC submitted, the remedies for unlawful conditions of detention would not necessarily extend to release into the community. Instead, the appropriate remedy might be no more than removal from being subjected to the conditions of detention that were inhuman and intolerable. Or it might extend to providing, in a case such as the present, an answer to a criminal offence expressed in terms that assume that the "detention" is lawful. 151 See, for example, B (2004) 78 ALJR 737 at 765-766 [155]-[159]; 206 ALR 130 at 152 Tan Te Lam v Superintendent of Tai A Chau Detention Centre [1997] AC 97 at 153 See Tan Te Lam [1997] AC 97 at 111. 154 ICCPR, Art 9.4. Kirby The provision of a facility for judicial scrutiny of the true legal character of the "immigration detention" of the appellant at the time of his "escape", to allow examination of its alleged features as "arbitrary", "unlawful", involving inhuman and intolerable conditions without respect for the dignity of the human person and subjecting the appellant to "cruel, inhuman or degrading treatment or punishment"155, would ensure the conformity of the Act under Australian law with the ICCPR. The alternative construction would not. This Court should adopt the meaning that most clearly conforms with the obligations that Australia has freely assumed under the ICCPR. It should avoid a construction that could occasion a breach of those obligations. This conclusion confirms the reasonable arguability in law of the answer which the appellant wishes to give to the charge that he faces of an offence against s 197A of the Act. In this appeal, it affirms the correctness of the dissenting view of Bleby J in the Full Court. Exhausting alternative remedies An absurd proposition: But can it be said, as the respondents submitted, that the appellant has remedies under administrative law, by the law of torts and otherwise for any alleged derogations from humane and tolerable conditions in "immigration detention"? Should it be held that these, and these alone, are the remedies available to him and that, by their existence, they exclude any right to challenge the lawfulness of his "escape" from such conditions? In Whipple156, Houser J acknowledged the intuitive weakness of this argument although, in the circumstances of that case, involving escape of a convicted prisoner, held under judicial order, he felt obliged to give it effect: "In a remote mountain camp, far from the sheriff's office, what relief could [the prisoner] obtain by telling his custodian that he wanted to see the sheriff? If the defense could be admitted at all, it should not be conditioned upon the making of a plainly useless request." The absurdity of restricting a person such as the appellant to collateral remedies is even more plain in this case than it was in Whipple. It is no answer to state that this appellant was represented by senior counsel (by inference acting pro bono). The overwhelming majority of asylum seekers who come to this Court are self-represented, and they are so because they lack the resources to 155 ICCPR, Art 7. 156 279 P 1008 at 1010 (1929). Kirby retain counsel. People confined in immigration detention are ordinarily likely to be impecunious, powerless, with limited command of the English language and, in a place as remote as Woomera, with extremely restricted access to legal assistance (and that ordinarily focussed solely on pursuit of a protection visa). Such individuals are much less able even than persons not in detention to pursue expensive civil claims against the Commonwealth and its officials where they commonly stand in peril of costs orders if they fail. for arguments affording substantive In any case, by the time any such claims reached a court hearing, it would be likely that most of the persons bringing them would have been removed from Australia. The provision to them of a visa to return for the trial would be highly doubtful, to say the least. And, in any case, the Act provides only the smallest toehold rights enforceable under administrative law. By way of contrast, the entitlement available to a person such as the appellant to resist a criminal prosecution based on an offence alleged against s 197A is a realistic one, capable of ready judicial determination. When a person is subjected to criminal process our law is usually tender to that person's right to defend himself or herself by a strict proof of every ingredient of the alleged crime. Even an animal, when cornered, is entitled to defend itself. Human beings have their human dignity, human rights and fundamental freedoms accorded by Australian and international law. Affording real remedies: This Court should not answer the appellant's endeavour to defend himself from prosecution for such offence by alluding to his "rights" to legal redress that are devoid of any real content or protection. Doing so would involve the Court not only in refusing a forum to determine the "lawfulness of his detention" in a way critical to the determination of his actual legal position157. It would also involve a failure of the Australian judicature to address a serious complaint of official unlawfulness in a context where that issue is relevant to the disposition of an actual legal controversy. The matter can be tested this way. Assume that the appellant was indeed subjected in "immigration detention" at Woomera to prolonged inhuman, intolerable, degrading and unhealthy conditions. Assume that there were no effective means of securing internal redress. Assume also that no effective remedies were available to him to repair serious affronts to his human rights and dignity. These are not unrealistic assumptions to make in today's world – even in respect of the modes of detention carried out by officials of "civilised" societies. In such circumstances, to deny the appellant the argument that he now propounds would, in practice, involve the Australian judiciary washing its hands of his case and of any unlawfulness that he could show in the conditions of his detention in answer to the criminal charge that his detainers now wish to bring against him. 157 ICCPR, Art 9.4. Kirby In my view, this Court should answer the present case in a realistic way, informed by the preceding considerations that I have identified. We should not give a legal answer that future generations will condemn and that we ourselves will be ashamed of. An arguable "defence" under the Act The appellant therefore has a reasonably arguable answer to the prosecution brought against him under s 197A of the Act. It is not strictly a "defence". That is because it is for the prosecution to prove every element of the crime with which it has charged the appellant. However, in practical terms, having proved the uncontested facts that the appellant arrived in Australia as an "unlawful non-citizen", was taken into "immigration detention" and was detained at Woomera which he left otherwise than in accordance with the Act, the prosecutor would establish a prima facie case. To mount an answer to that case, challenging the character of the "detention", in terms of the Act, and the character of his departure as an "escape" from such "detention", the appellant would need to rely on evidence. Forensically, he would be bound to tender such evidence. It was to that end that the appellant issued the witness summonses out of the Magistrate's Court. Because I reject the assertion that the answer to the charge alleging an offence against s 197A of the Act is unavailable to the appellant as a matter of law, I am of the view that the primary judge erred in setting aside the appellant's witness summonses. The majority of the Full Court erred in failing to correct the primary judge's error. I agree with the Full Court's conclusion that the primary judge placed too high an onus on the appellant in suggesting that, before witness summonses would be allowed, he was bound to demonstrate that his proposed defence would succeed158. However, I do not accept the majority's conclusion that the appellant's complaints about the conditions of his "detention" could not, in law, afford an arguable answer to the charge, apt to respond to an extreme case. Nor do I believe that the theoretical availability of other civil remedies affords the only context in which the judiciary could respond to the appellant's complaints159. Such a hollow answer does not represent the law of Australia. It is contrary to the language of the Act, the requirements of the Constitution and the obligations assumed by Australia under international law. It is therefore one that I would reject. 158 Behrooz (2003) 84 SASR 479 at 480 [3]. 159 Behrooz (2003) 84 SASR 479 at 480 [9]. Kirby The argument of oppression and remitter The notice of contention: The foregoing conclusions require that the appeal be allowed. However, by a notice of contention, the first respondent submitted that the order of the Full Court should be sustained on the basis that the primary judge ought to have held that the witness summonses were oppressive and/or an abuse of process. It will be remembered that this was one of the two substantive issues raised in the challenge brought to the Supreme Court against the order of the Chief Magistrate160. The materials sought in the witness summonses related to documents in the respondents' files concerning the appellant and other detainees at Woomera, past and present, together with incident reports and materials on medical histories and other confidential documents. The first respondent, by affidavit read in the Supreme Court, suggested a number of reasons why the witness summonses were oppressive. In summary, these were: (1) that they imposed an unreasonable burden in collecting and identifying the voluminous materials sought; (2) that already a very heavy obligation had been imposed identifying relevant files, photocopying items and anonymising some of them for privacy and like reasons; and (3) that public policy objections would arise, together with privacy objections, that would consume undue time and expense to sort out. The primary judge rejected this argument, finding that no error of principle had been demonstrated in the refusal of the Chief Magistrate to set the summonses aside upon this ground. There is no record that the respondents persisted with this point in the Full Court, by a notice of contention. The Full Court does not deal with it in its reasons. The issue raised by the notice of contention in this Court was fully argued in oral and written submissions. It is fair to say, as the appellant did, that it would have been unlikely that any of the respondents would have secured special leave to appeal on this point, had it stood alone. Remitter to the Full Court: Nevertheless, although this Court will sometimes dispose of appeals on the basis of a notice of contention, even one raising arguments never advanced in the courts below161, my own view is that such a course should be reserved for a truly exceptional case. Ordinarily, where necessary, such points should be dealt with by the intermediate court. Any other 160 These reasons, above at [68]. 161 See Gattellaro v Westpac Banking Corp (2004) 78 ALJR 394; 204 ALR 258. Kirby course may unjustly deprive a party of the opportunity of further appellate reconsideration of a decision on the point. I cannot say that the complaint of oppression by the very wide terms of the witness summonses is unarguable. On the contrary, I can understand the opinion which Callinan J expresses in his reasons concerning the scope of the summonses162. As my disposition of this appeal is a minority one, I will not delay over this issue. It is sufficient to say that, for the establishment of the answer which the appellant wishes to bring to the charge against him under s 197A of the Act, much more precisely drawn summonses would have sufficed. Had this been the only objection to the witness summonses, practical considerations might well have encouraged negotiations between the parties and identification by the appellant of the essential evidence that he demanded. In the way the appeal was argued this issue was not ultimately refined. It is not suitable for decision by this Court. Orders The appeal should be allowed with costs. The order of the Full Court of the Supreme Court of South Australia should be set aside. In lieu of that order, there should be substituted an order granting leave to appeal against the orders of the primary judge. Those orders should be set aside. The proceedings should be returned to the Full Court of the Supreme Court of South Australia to dispose of the questions raised in the notice of contention filed by the first respondent in this Court. The costs of the appeal to the Full Court of the Supreme Court of South Australia should abide the final disposition of the application to that Court, made consistently with the decision of this Court. 162 Reasons of Callinan J at [224]. Hayne 152 HAYNE J. The Migration Act 1958 (Cth) ("the Act") requires that unlawful non-citizens be kept in immigration detention until one of three events occurs (the non-citizen is removed or deported from Australia or is granted a visa). The appellant is, and since before 18 November 2001 has been, an unlawful non-citizen. He has not been removed from Australia and has not been granted a visa. "Immigration detention" means, among other things, being held in a detention centre established under the Act. The appellant was being held at the Woomera Immigration Reception and Processing Centre ("Woomera"), a place which had been established as a detention centre. Section 197A provides that a person detained must not escape from immigration detention. The penalty prescribed is imprisonment for five years. It is alleged that the appellant escaped from Woomera. This appeal raises two issues. First, could the conditions in which persons were held be so bad that the place of detention ceased to be a detention centre? These reasons will seek to demonstrate that, contrary to the appellant's submissions, the conditions under which a person is held at a detention centre are irrelevant to whether the detention from which the person escaped was "immigration detention". The second issue, which would arise only if the appellant succeeded on the first issue, concerns the breadth of summonses to witnesses issued on the appellant's behalf requiring the production of documents which it is alleged may show what were the conditions under which the appellant was detained at Woomera. The proceedings below The appellant was charged in the Port Augusta Magistrates Court with escaping from immigration detention. The particulars given of that offence were that on or about 18 November 2001 the appellant, being a detainee at Woomera, escaped. The appellant obtained the issue of witness summonses under the Magistrates Court Act 1991 (SA) (s 20), one of which was directed to the proper officer of the Department of Immigration and Multicultural and Indigenous Affairs. Similar summonses were issued to the proper officer of the third and fourth respondents. Each summons required the production of any document which had come into existence since 1 December 1999 and met one or more of the descriptions set out in nine paragraphs. It is enough to describe the documents that were sought as being concerned with conditions and complaints about conditions at Woomera. The Secretary of the Department and the third and fourth respondents each applied to set aside the witness summonses on the ground that each summons was oppressive and an abuse of process. In substance two matters were identified as requiring that conclusion. First, it was said that "the issue to which all of the documents may be relevant is an issue upon which, for constitutional reasons, the [appellant] cannot possibly succeed". Secondly, each summons was said to be too wide. Hayne The Chief Magistrate of South Australia, Mr Moss, dismissed the application to set aside the summonses. Pursuant to s 42 of the Magistrates Court Act, the Secretary of the Department and the third and fourth respondents appealed to the Supreme Court of South Australia. At first instance, Gray J allowed the appeals163 and ordered that the summonses be set aside. By majority (Lander and Besanko JJ; Bleby J dissenting), the application of the appellant (and two other men charged with him, but since removed from Australia) for leave to appeal to the Full Court of the Supreme Court of South Australia was dismissed164. The majority of the Court held165 that it was not "reasonably arguable that [the primary judge] erred in concluding that the [appellant] had not identified a defence known to law". Their Honours went on to say166: "We cannot see how it can be said that the harshness of the conditions at [Woomera] can lead to the conclusion that the [appellant and the others then party to the proceeding] were no longer detainees or in some way they were no longer being held in immigration detention. We do not accept that harshness of conditions in a detention centre means that a detention centre ceases to have the character of a detention centre by reason that the harshness of conditions is contrary to the power of detention in the Act." By special leave the appellant now appeals to this Court. The third and fourth respondents took no active part in the proceedings in this Court. This appeal was heard at the same time as the appeals in Al-Kateb v Godwin167 and Minister for Immigration and Multicultural and Indigenous Affairs v Al Khafaji168. 163 Secretary, Department of Immigration and Multicultural and Indigenous Affairs v Behrooz (2002) 84 SASR 453. 164 Behrooz v Secretary, Department of Immigration, Multicultural and Indigenous Affairs (2003) 84 SASR 479. 165 (2003) 84 SASR 479 at 480 [4]. 166 (2003) 84 SASR 479 at 480 [7]-[8]. 167 [2004] HCA 37. 168 [2004] HCA 38. Hayne The contentions There was no evidence in the courts below which would permit any finding of fact about what the conditions at Woomera were at any time, whether on or before 18 November 2001 or since. The application which gives rise to the present appeal concerned summonses to witnesses. There has been no trial of the proceeding brought against the appellant. There has been no occasion for the courts below, and there is, therefore, no occasion for this Court, to make any finding about those conditions. This appeal must be decided by reference to possibilities: could the conditions at Woomera have been so bad that it ceased to be a detention centre? The appellant submitted that the Act only authorised, and could only validly authorise, detention that is reasonably capable of being seen as necessary for migration control purposes. Detention in what the appellant described as "inhumane conditions" was not, and could not validly be, authorised by the Act. So much followed, it was submitted, from the Act's definition of "detain" and from a constitutional inhibition on the infliction of punishment under federal legislation except in the exercise of the judicial power of the Commonwealth. Although the two branches of the argument (one about the construction of the Act, and the other about constitutional limitations) overlapped, it is desirable to begin considering them by dealing with the question of statutory construction. Construction of the detention provisions The scheme of the Act's provisions for the mandatory detention of unlawful non-citizens is described in my reasons in Al-Kateb169. I will not repeat that description here. It is necessary in this matter, however, to say more about both the Act's definition of "immigration detention" and its definition of "detain". "Immigration detention" is defined, in s 5 of the Act, as meaning: being in the company of, and restrained by: an officer; or in relation to a particular detainee—another person directed by the Secretary to accompany and restrain the detainee; or being held by, or on behalf of, an officer: in a detention centre established under this Act; or 169 [2004] HCA 37 at [199], [210]-[211]. Hayne in a prison or remand centre of the Commonwealth, a State or a Territory; or (iii) in a police station or watch house; or in relation to a non-citizen who is prevented, under section 249, from leaving a vessel—on that vessel; or in another place approved by the Minister in writing; but does not include being restrained as described in subsection 245F(8A), or being dealt with under paragraph 245F(9)(b)." It will be seen that the definition is in two, disjunctive, parts. The first (dealt with in par (a)) turns upon the identity of the person effecting the restraint. The person, in whose company the detainee must be and by whom the restraint is effected, must be an officer or another person directed by the Secretary to accompany and restrain that detainee. The second part of the definition (par (b)) refers to being held by or on behalf of an officer at any of five kinds of place, of which one is "a detention centre established under this Act". Section 273 of the Act authorises the Minister, on behalf of the Commonwealth, to "cause detention centres to be established and maintained". A "detention centre" is defined, for the purposes of s 273, as "a centre for the detention of persons whose detention is authorised" under the Act. Although s 273 permits the making of regulations to "make provision in relation to the operation and regulation of detention centres", no regulations have been made about those subjects. One of the elements of the offence of escaping from immigration detention is, of course, the demonstration that there was an escape from what the Act identifies as immigration detention. For present purposes, it may reasonably be anticipated that the case to be made against the appellant is that he escaped from being held by, or on behalf of, an officer in a detention centre established under the Act. One necessary element in the proof of that case would be that Woomera was a detention centre established under the Act. May the appellant answer that case by pointing to the conditions which existed at Woomera? (When I say "pointing to" I leave aside any question there may be about which side would bear an onus of proof about the matter and any question about the standard of proof.) The appellant's statutory construction argument focused upon the Act's definition of "detain". "Detain" is defined, in s 5, as meaning: take into immigration detention; or keep, or cause to be kept, in immigration detention; Hayne and includes taking such action and using such force as are reasonably necessary to do so." "Detain" is used in s 189 of the Act. Among other things, that section obliges an officer to "detain" a person who the officer knows or reasonably suspects to be an unlawful non-citizen in the migration zone. "Detain" is not used in s 197A, which provides that "[a] detainee must not escape from immigration detention". But "detained" is used in the Act's definition of "detainee" as meaning "a person detained". It follows that, subject as always to any contrary intention appearing, the definition of "detain" informs the meaning of "detainee"170. The appellant submitted that the words "as are reasonably necessary to do so", appearing at the end of the definition of "detain", govern all that precede them in the definition. In particular, so it was submitted, the detention and conditions of detention permitted and required by those provisions of the Act which used "detain", or one of its parts of speech, were limited to detention reasonably necessary for migration control purposes. Although the argument necessarily directed attention to the conditions of detention, it was framed as an argument which would mark both the temporal and the physical boundaries of permissible detention by reference to what was "reasonably necessary". The immediate answer to this aspect of the appellant's contentions is that the words of the definition of "detain" do not bear the meaning asserted. The phrase "as are reasonably necessary to do so" qualifies the expressions "taking such action" and "using such force". Those expressions, in turn, amplify what is meant by "take into" immigration detention and "keep, or cause to be kept" in immigration detention. It is to those actions which "to do so" refers. The phrase "as are reasonably necessary to do so" does not qualify what is meant by "immigration detention". That latter term is, as has earlier been pointed out, a defined term. One of its meanings is being held by, or on behalf of, an officer at a particular kind of place. The conditions that exist at that place form no part of the statutory identification of what is "immigration detention". A constitutional limitation? Is there, as the appellant contended, a constitutional reason to confine the statutory meaning of immigration detention to detention in such conditions as are reasonably capable of being seen as necessary for migration control purposes? Is there a constitutional reason to conclude that the appellant's detention would cease to be immigration detention if the conditions of confinement passed 170 Acts Interpretation Act 1901 (Cth), s 18A. Hayne beyond what was reasonably capable of being seen as necessary for migration control purposes? In the courts below, the appellant explicitly disavowed any contention based on doctrines of necessity. He did not seek to make such a case in this Court. Thus he may be taken to have disclaimed any argument that his departure (to use a designedly neutral term) from Woomera was necessary to preserve his life or limb. No argument was advanced by analogy with the prisoner who leaves a gaol because it is on fire and, to stay within the prison boundaries, would be to risk death or serious injury171. Rather, the appellant's argument depended upon identifying "immigration detention" in a way that not only permitted, but required, consideration of the conditions experienced by the detainee. The first and second respondents (the Secretary of the Department and the Attorney-General of the Commonwealth) accepted that the Act does not authorise detention in inhumane conditions. But they submitted that the conditions under which the appellant was detained are irrelevant to whether he escaped from "immigration detention". Central to the appellant's contentions was that there is no "meaningful" (presumably in the sense of legally relevant) distinction to be drawn between detention and the conditions of detention. The appellant submitted that there can be no detention without conditions of detention, and that detention, and the manner of detention are one and the same thing. Thus, so the argument proceeded, the Act can only validly authorise detention under conditions that are reasonably capable of being seen as necessary for migration control purposes. The appellant's argument founded upon what was said in the joint reasons of Brennan, Deane and Dawson JJ in Chu Kheng Lim v Minister for Immigration172. There, their Honours said, of what were the then provisions of ss 54L and 54N of the Act, that those sections: "will be valid laws if the detention which they require and authorize is limited to what is reasonably capable of being seen as necessary for the purposes of deportation or necessary to enable an application for an entry permit to be made and considered. On the other hand, if the detention which those sections require and authorize is not so limited, the authority which they purportedly confer upon the Executive cannot properly be seen as an incident of the executive powers to exclude, admit and deport an alien. In that event, they will be of a punitive nature and contravene 171 Hale, The History of the Pleas of the Crown, (1736) (1971 reprint), vol 1 at 611. 172 (1992) 176 CLR 1 at 33. Hayne Ch III's insistence that the judicial power of the Commonwealth be vested exclusively in the courts which it designates." As is apparent from my reasons in Al-Kateb173, I consider that the line which their Honours drew between the valid authorisation of executive detention and punitive detention is difficult to identify with certainty. Further, the distinction which was drawn in Chu Kheng Lim does not take into account that a law requiring the detention of unlawful non-citizens until they are removed, deported or granted a visa, would be a valid law of the Commonwealth to the extent to which it provided for the exclusion of an unlawful non-citizen from the Australian community which he or she did not have permission to join. Whether or not there are these difficulties about the distinction drawn in this passage in Chu Kheng Lim, its application would not lead to the conclusion asserted by the appellant about the relevance of conditions of detention to the charge of escape which has been laid against him. The appellant accepted that there were cases in which detention of non-citizens was reasonably necessary for migration control purposes. The particular mode of immigration detention permissible was said to depend on the particular circumstances of individual cases. To detain non-citizens in conditions harsher than those reasonably necessary for migration control purposes was said to be punitive. Because it was punitive it could not validly be authorised except as a consequence of the exercise of the judicial power under Ch III of the Constitution. The Act, in terms, authorised the appellant's detention at any of a number of identified places. By its definition of "detain", the Act permitted taking such action and using such force as was reasonably necessary to keep the appellant at one of those places of detention. Otherwise, the Act was silent about how the appellant might be treated while at a place of detention. If it is assumed, for the purposes of argument, that it could be shown that those kept at a place of detention were treated harshly, the lawfulness of such treatment may very well be open to challenge. The detaining authority owes duties of reasonable care to those whom it detains174. To use more than such force as is reasonably necessary to keep someone in detention would constitute an assault. So the examples could be multiplied. But the place at which the person is detained would remain one of the places identified by the Act where to be held by or on behalf of an officer would mean being in "immigration detention". And any want of valid legislative authority to commit those acts or 173 [2004] HCA 37 at [258]. 174 Howard v Jarvis (1958) 98 CLR 177 at 183. Hayne make those omissions, which together are said to render the conditions of detention harsh or punitive, denies the lawfulness of those acts and omissions. It does not deny the lawfulness of detention at the place identified in the Act. The question which the appellant sought to pose – can the appellant's detention at Woomera, in the conditions he experienced, be seen as reasonably necessary for migration control purposes? – cannot be confined to an inquiry about conditions of detention. As was pointed out in argument, the logical consequence of this contention (that detention could be permitted only for migration control purposes) was that s 189 of the Act was invalid in so far as it provided for the mandatory detention of all unlawful non-citizens. Necessarily, the question posed would permit the answer that, in a particular case, no restraint of any kind on the liberty of the non-citizen was necessary. That is, the question is one which challenges not only the conditions in which detainees are held, it challenges the validity of those provisions requiring mandatory detention of unlawful non-citizens. For the reasons I give in Al-Kateb, I consider that those provisions of the Act which provide for the mandatory detention of unlawful non-citizens for the period described in s 196 of the Act are valid laws of the Commonwealth. Once that conclusion is reached, it follows that the inquiry about conditions of detention must be irrelevant. What the Act fastens upon is the place of detention, not the conditions experienced while at that place. The limitation on power of the kind to which the appellant points affects the lawfulness of what is done and not done at that place. It does not deny the applicability of the statutory description "immigration detention" to being kept at such a place. It is unnecessary, therefore, to confront the formidable difficulties which an inquiry about conditions would present for identifying when, exactly, detention passed from lawful to unlawful175. The summonses The material sought by the witness summonses relating only to the conditions of detention at Woomera, the summonses should have been set aside. Because an appeal to the Full Court against the orders of Gray J would, therefore, have failed, the Full Court's order refusing leave to appeal to that Court should not be disturbed. It is, therefore, unnecessary to reach the second, subsidiary, issue which was raised: whether the witness summonses were too wide. The summonses required the identification of documents which came into existence between 175 R v Deputy Governor of Parkhurst Prison; Ex parte Hague [1992] 1 AC 58; Prisoners A–XX Inclusive v New South Wales (1995) 38 NSWLR 622. Hayne 1 December 1999 and 18 November 2001. The evidence adduced at the hearing of the application to set aside the summonses suggested that it would be necessary to examine more than 3,000 files, more than 1,500 electronic documents and about 6,000 incident reports. About 745 hours had already been spent by at least 47 officers in identifying and locating files and it was estimated that completion of the process would be likely to take more than a further 1,000 hours. The task to be undertaken was, therefore, very large. Without first identifying the issue in the case to which such material may be relevant, it is not possible to conclude, from those figures alone, that the summonses were oppressively wide. Further, these being criminal proceedings, in which procedures for discovery of documents were not available, the drawing of analogies between the obligations imposed by the witness summonses, and those which would arise under processes of discovery, are not conclusive of whether the summonses should be set aside as an abuse of process. Summonses to witnesses requiring the production of documents or other materials are not to be used for purposes other than requiring production of those documents and materials to the court176. That the documents sought by these witness summonses included documents created nearly two years before the date of the appellant's alleged offence, taken with the breadth of subjects covered by the specification of documents made in the summonses, may well suggest strongly that the summonses were not issued for the purpose of production of the documents to the court, so much as for the purpose of permitting the appellant's advisers to trawl through what was produced in the hope of generating lines of inquiry not otherwise available to support the case which it was sought to make. To decide whether that is so, however, would require a much closer analysis of the categories of documents sought, by reference to a relevant legal issue. Having concluded that the issue which the appellant seeks to raise is irrelevant, that inquiry cannot be made. The appeal must be dismissed with costs. 176 Commissioner for Railways v Small (1938) 38 SR(NSW) 564 at 574; National Employers' Mutual General Association Ltd v Waind & Hill [1978] 1 NSWLR 372 Callinan CALLINAN J. The principal question in this appeal is whether harsh conditions of detention of illegal entrants to this country may constitute punishment of a kind which may only be imposed by courts in the exercise of judicial power. Facts Mr Behrooz is the sole appellant. Two other appellants, who were granted special leave in this matter, have been removed from Australia and the criminal charges against them dropped. Special leave in their favour was rescinded by the Court at the hearing. The appellant was charged on information that: "On or about the 18th day of November 2001 being a detainee escaped from Immigration Detention contrary to section 197A of the Migration Act 1958." Particulars were provided: "On or about the 18th day of November 2001 the defendant being [a detainee] at the Woomera Immigration [Reception and Processing] Centre escaped." Section 197A of the Migration Act 1958 (Cth) ("the Act") provided: "A detainee must not escape from immigration detention. Penalty: Imprisonment for 5 years." For some time prior to 18 November 2001, the appellant had been in immigration detention at the Woomera Immigration Reception and Processing Centre ("Woomera"), a centre established pursuant to the Act. The Magistrates Court On 10 January 2002, on the appellant's application, the Magistrates Court at Port Augusta issued summonses to the Department of Immigration and Multicultural and Indigenous Affairs ("DIMIA"), Australasian Correctional Management Pty Ltd and Australasian Correctional Services Pty Ltd. The summonses sought the production of material as follows: "Evidentiary Material The documents to be produced are any documents which came into existence since 1st December 1999 and which: Callinan contain or refer to complaints or concerns about conditions in Woomera; contain or refer to protests about conditions in Woomera; contain recommendations or requests for improvement of the conditions in Woomera; contain reports on: protests by detainees at Woomera; the physical health of detainees at Woomera; the psychological health of detainees at Woomera; comprise records or reports of incidents or disturbances at Woomera reportable under or covered by Incident Reporting Procedures or Emergency Procedures detailed in Operational Orders; contain a record or report concerning any of: (a) Davood Hossein Amiri (d) Mahmood Gholani Moggaddam (e) Mehran Behrooz contain or refer to the services, facilities, activities and programs designed to meet the individual needs of each of: (a) Davood Hossein Amiri (d) Mahmood Gholani Moggaddam (e) Mehran Behrooz Callinan contain or refer to the policy or procedures at Woomera regarding: professional visits to detainees; social visits to detainees; visits to detainees by humanitarian or welfare groups; contain concerns of or criticisms by: (a) United Nations High Commissioner for Refugees; (b) Human Rights and Equal Opportunity Commission; (c) Amnesty International regarding the conditions of detention at Woomera." In March and April 2002 applications were made by the respondents to set aside each of the summonses on the following grounds: The witness summons ... involves a matter arising under the Constitution or involving its interpretation. The witness summons ... is oppressive and an abuse of the process of the Court because: the issue to which all of the documents may be relevant is an issue upon which, for constitutional reasons, the [appellant] cannot possibly succeed; in any event: iii) the volume of material sought is excessive; the subpoena is indirectly seeking discovery and, in particular, it requires elaborate exercises of judgment by the [respondents]; and the subpoena refers to production of documents for time periods when the [appellant was] not in detention and seeks documents in relation to minors when the [appellant is an adult]." The respondents sought these orders: Callinan That proceedings in respect of the summons be stayed pending compliance with the provisions of section 78B of the Judiciary Act That the summons be set aside. Any other orders that the Court sees fit." The applications were heard on 6 and 7 May 2002. The Chief Magistrate (Moss CM) delivered reasons on 24 May 2002 foreshadowing his proposed orders. At the request of the respondents, the Chief Magistrate refrained from pronouncing orders, and adjourned the matter for one week, to allow the Commonwealth to consider the making of an application to remove the application to this Court. No application was in fact made. On 31 May 2002 the Chief Magistrate again refrained from pronouncing orders and adjourned the matter for another week to allow the Commonwealth to formulate a case for the Chief Magistrate to state to the Supreme Court of South Australia. On 7 June 2002 the Chief Magistrate rejected the Commonwealth's application to state a case and pronounced his orders. In his reasons, the Chief Magistrate noted the submissions of counsel for the appellant: "... even though detention for the purposes of [the] Migration Act was capable of being valid detention, if the conditions of detention were so obviously harsh as to render them punitive, then the detention went beyond that which was authorised by the Act and was necessarily illegal. In effect [counsel for the appellant] argues that if the detention is in fact punitive, then it must necessarily be illegal. ... it is the very nature of the detention which determines whether it is lawful or unlawful. If the detention is in fact punitive detention, then it is not detention which is authorised by the Act, notwithstanding that the sections are a valid constitutional enactment and hence the detention is unlawful. If follows that escape from such detention does not amount to an offence." He concluded: "I am of the view that [the appellant's] argument is a powerful one. At this stage, however, I do not have to decide the issue. It will be for the magistrate who hears the case and that may not be me, to make a decision upon the law that relates to the charges. It would be embarrassing for that magistrate if I were to now try to determine that legal issue in advance. For the purpose of those applications to set aside the subpoena, I must decide whether or not the [appellant's] outlined defence has, in a legal sense, any prospect of success. I do not agree with the arguments of the Callinan learned Solicitor General that the [appellant's] defence must necessarily fail upon legal grounds. On the contrary I think it has a perfectly good chance. It therefore follows that the applications cannot succeed on this point." The Chief Magistrate generally rejected the respondents' submissions as to the oppressive nature of the subpoena. After hearing the cross-examination of one of the respondents he found: "the Department will be perfectly up to the task of sifting through the documents and producing those which may, at the end of the day, be critically relevant to the [appellant's] proposed defence." He made one exception: "only insofar as to exempt documents which relate to periods outside the period of 23 months prior to 18 November 2001 or which relate solely to minors." The Supreme Court of South Australia The respondents appealed to the Supreme Court of South Australia (Gray J). In the alternative, to meet the possibility that an appeal might not lie as of right, the respondents sought leave to appeal, and judicial review in the nature of certiorari and mandamus pursuant to s 17 of the Supreme Court Act 1935 (SA) and r 9 of the Supreme Court Rules. No issue arises in this Court as to the appropriateness of the procedure adopted and as to the jurisdiction of the Supreme Court of South Australia to deal with the matter. A major submission advanced by the appellant was that his detention at Woomera went beyond anything that could reasonably be regarded as necessary for the purposes of the Act. His detention was not a form of detention authorised by law. A detainee who escaped from Woomera was not therefore escaping from immigration detention. The appellant accordingly had a defence against each of the charges. The appellant did not contend that he had a defence of necessity. No foundation was laid for a submission that the appellant's escape was excusable because of any grave predicament with which he was confronted. Nor was it claimed that the appellant was compelled to escape from Woomera by threat or danger: nor was it suggested that there was any threat that was "present and continuing" in the sense that it effectively neutralised his will when he escaped. Callinan After referring to the provisions of the Act relating to immigration detention and cases in Australia and the United Kingdom, Gray J concluded as follows177: "The [appellant has] not established that the material sought by the summonses has evidentiary value in the proceedings. The material does not directly establish the conditions of the [appellant's] detention. The material does not raise an arguable case of punitive detention. The material does not establish a link between the conditions of detention at [Woomera] and the [appellant's] alleged escape. The [appellant's] detention is authorised by the Migration Act. The [appellant has] not identified a defence known to the law. The [appellant's] complaint raises allegations about the conditions of [his] lawful detention. Those complaints cannot as a matter of law make the detention unlawful. The [appellant does] not seek relevant material. The summonses are set aside." Although it was not necessary for him to do so, his Honour also decided a further argument advanced by the respondents, that in its width, absence of particularity, intrusion upon confidentiality, and irrelevance to the appellant's situation in detention, each summons was oppressive, and should for that reason be set aside. His Honour would not however have been prepared to set aside the The appellant sought leave to appeal to the Full Court of the Supreme Court of South Australia (Lander, Bleby and Besanko JJ). Lander and Besanko JJ disposed of the application in this way179: "Gray J decided the matter against the [appellant] on two grounds. First, assuming for the purpose of considering this point that the [appellant has] identified a defence known to law, he held that the material the [appellant] put forward was not, as a matter of fact, sufficient to establish that the documentary material sought by the subpoenas was evidentiary material: ss 3 and 20(1) of the Magistrates Court Act 1991 (SA). 177 Secretary, Department of Immigration and Multicultural and Indigenous Affairs v Behrooz (2002) 84 SASR 453 at 473 [72]-[73]. 178 Secretary, Department of Immigration and Multicultural and Indigenous Affairs v Behrooz (2002) 84 SASR 453 at 477-478 at [90]. 179 Behrooz v Department of Immigration and Multicultural and Indigenous Affairs (2003) 84 SASR 479 at 479-480 [2]-[7]. Callinan We think it is arguable that his Honour erred in this respect in that he placed too high an onus on the [appellant]. It is reasonably arguable that, although the court must be satisfied that the subpoenas do not involve a fishing expedition or have not been issued for an improper or collateral purpose, the [appellant does] not have to establish a prima facie or arguable case that the proposed defence will succeed before subpoenas will be allowed. We think it is arguable that what is required will depend on the circumstances of the particular case, but that in this case his Honour erred in his statement of the level of proof or satisfaction required from the [appellant]. However, we do not think it is reasonably arguable that his Honour erred in concluding that the [appellant] had not identified a defence known to law. This is fatal to the [appellant's] application irrespective of the outcome of the first point. The [appellant seeks] to argue that [his] detention at [Woomera] was unlawful because of the harshness of the conditions at [Woomera]. The status of the [appellant] as [an] unlawful non-citizen is not challenged. The fact that in the first instance [he was] lawfully detained, pursuant to s 189 of the Migration Act 1958 (Cth), is not disputed. The [appellant does] not question the validity of any section of the Migration Act particularly s 196 of the Act. Thus, it is not disputed that in being detained [the appellant was] in immigration detention. There is no dispute that [Woomera] was established as an immigration detention centre pursuant to the Act. We cannot see how it can be said that the harshness of the conditions at [Woomera] can lead to the conclusion that the [appellant was] no longer [a detainee] or in some way [he was] no longer being held in immigration detention." Bleby J was of a different view180: "I would grant leave to appeal. In my opinion, the [appellant has] an arguable case on both the grounds on which Gray J decided the appeal from the magistrate. The issues concerned are of importance, of course, in the operation of the Migration Act. For those reasons I would grant leave." 180 Behrooz v Department of Immigration and Multicultural and Indigenous Affairs (2003) 84 SASR 479 at 480 [11]. Callinan The appeal to this Court Before dealing with the arguments of the parties I should set out, as at the date of the appellant's escape from Woomera, the relevant provisions of the Act. Section 4 should be noted first: "Object of Act The object of this Act is to regulate, in the national interest, the coming into, and presence in, Australia of non-citizens. To advance its object, this Act provides for visas permitting non- citizens to enter or remain in Australia and the Parliament intends that this Act be the only source of the right of non-citizens to so enter or remain. To advance its object, this Act requires persons, whether citizens or non-citizens, entering Australia to identify themselves so that the Commonwealth government can know who are the non-citizens so entering. To advance its object, this Act provides for the removal or deportation from Australia of non-citizens whose presence in Australia is not permitted by this Act." Section 5 defined what it meant to "detain" a person: "detain means: take into immigration detention; or keep, or cause to be kept, in immigration detention The same section defined "immigration detention" as follows: "immigration detention means: being held by, or on behalf of, an officer: in a detention centre established under this Act; or in another place approved by the Minister in writing; Callinan Section 36 of the Act provided as follows: "Protection visas There is a class of visas to be known as protection visas. (2) A criterion for a protection visa is that the applicant for the visa is: a non-citizen in Australia to whom the Minister is satisfied Australia has protection obligations under the Refugees Convention as amended by the Refugees Protocol; or a non-citizen in Australia who is the spouse or a dependant of a non-citizen who: is mentioned in paragraph (a); and holds a protection visa. Protection obligations (3) Australia is taken not to have protection obligations to a non-citizen who has not taken all possible steps to avail himself or herself of a right to enter and reside in, whether temporarily or permanently and however that right arose or is expressed, any country apart from Australia, including countries of which the non-citizen is a national. (4) However, if the non-citizen has a well-founded fear of being persecuted in a country for reasons of race, religion, nationality, membership of a particular social group or political opinion, subsection (3) does not apply in relation to that country. (5) Also, if the non-citizen has a well-founded fear that: a country will return the non-citizen to another country; and the non-citizen will be persecuted in that other country for reasons of race, religion, nationality, membership of a particular social group or political opinion; subsection (3) does not apply in relation to the first-mentioned country. Callinan Determining nationality For the purposes of subsection (3), the question of whether a non- citizen is a national of a particular country must be determined solely by reference to the law of that country. Subsection (6) does not, by implication, affect the interpretation of any other provision of this Act." Section 176 referred to detention, but not to detention under Div 7 of the Act: "Reason for Division This Division is enacted because the Parliament considers that it is in the national interest that each non-citizen who is a designated person should be kept in immigration detention until he or she: leaves Australia; or is given a visa." Section 182 referred to temporal limitations but applied only to certain aliens: "No immigration detention or removal after certain period Sections 178 and 181 cease to apply to a designated person who was in Australia on 27 April 1992 if the person has been in application immigration detention after commencement for a continuous period of, or periods whose sum is, 273 days. an entry application for a designated person has been refused; and apart from this subsection, section 178 would cease to apply to the person; and the person begins court or tribunal proceedings in relation to the refusal; that section applies to the person during both these proceedings and the period of 90 days after they end, whether or not this subsection has applied to that entry application before." Callinan Section 189 in Div 7 of the Act was expressed in mandatory language: "Detention of unlawful non-citizens If an officer knows or reasonably suspects that a person in the migration zone (other than an excised offshore place) is an unlawful non-citizen, the officer must detain the person. If an officer reasonably suspects that a person in Australia but outside the migration zone: is seeking to enter the migration zone (other than an excised offshore place); and (b) would, if in the migration zone, be an unlawful non-citizen; the officer must detain the person. If an officer knows or reasonably suspects that a person in an excised offshore place is an unlawful non-citizen, the officer may detain the person. If an officer reasonably suspects that a person in Australia but outside the migration zone: is seeking to enter an excised offshore place; and (b) would, if in the migration zone, be an unlawful non-citizen; the officer may detain the person. In subsections (3) and (4) and any other provisions of this Act that relate to those subsections, officer means an officer within the meaning of section 5, and includes a member of the Australian Defence Force." Section 196 provided as follows: "Period of detention (1) An unlawful non-citizen detained under section 189 must be kept in immigration detention until he or she is: removed from Australia under section 198 or 199; or deported under section 200; or granted a visa. Callinan To avoid doubt, subsection (1) does not prevent the release from immigration detention of a citizen or a lawful non-citizen. To avoid doubt, subsection (1) prevents the release, even by a court, of an unlawful non-citizen from detention (otherwise than for removal or deportation) unless the non-citizen has been granted a visa." Section 198 was very comprehensively expressed and provided as follows: "Removal from Australia of unlawful non-citizens (1) An officer must remove as soon as reasonably practicable an unlawful non-citizen who asks the Minister, in writing, to be so removed. (2) An officer must remove as soon as reasonably practicable an unlawful non-citizen: (a) who is covered by subparagraph 193(1)(a)(i), (ii) or (iii) or paragraph 193(1)(b), (c) or (d); and (b) who has not subsequently been immigration cleared; and (c) who either: has not made a valid application for a substantive visa that can be granted when the applicant is in the migration zone; or has made a valid application for a substantive visa, that can be granted when the applicant is in the migration zone, that has been finally determined. (2A) An officer must remove as soon as reasonably practicable an unlawful non-citizen if: the non-citizen is covered by subparagraph 193(1)(a)(iv); and since the Minister's decision (the original decision) referred to in subparagraph 193(1)(a)(iv), the non-citizen has not made a valid application for a substantive visa that can be granted when the non-citizen is in the migration zone; and in a case where the non-citizen has been invited, in accordance with section 501C, to make representations to Callinan the Minister about revocation of the original decision – either: the non-citizen has not made representations in accordance with the invitation and the period for making representations has ended; or the non-citizen has made accordance with the invitation and the Minister has decided not to revoke the original decision. representations The fact that an unlawful non-citizen is eligible to apply for a substantive visa that can be granted when the applicant is in the migration zone but has not done so does not prevent the application of subsection (2) or (2A) to him or her. (5) An officer must remove as soon as reasonably practicable an unlawful non-citizen if the non-citizen: is a detainee; and (b) was entitled to apply for a visa in accordance with section 195, to apply under section 137K for revocation of the cancellation of a visa, or both, but did neither. (6) An officer must remove as soon as reasonably practicable an unlawful non-citizen if: the non-citizen is a detainee; and the non-citizen made a valid application for a substantive visa that can be granted when the applicant is in the migration zone; and one of the following applies: the grant of the visa has been refused and the application has been finally determined; (iii) the visa cannot be granted; and the non-citizen has not made another valid application for a substantive visa that can be granted when the applicant is in the migration zone. (7) An officer must remove as soon as reasonably practicable an unlawful non-citizen if: Callinan the non-citizen is a detainee; and Subdivision AI of Division 3 of this Part applies to the non- citizen; and either: the non-citizen has not been immigration cleared; or the non-citizen has not made a valid application for a substantive visa that can be granted when the applicant is in the migration zone; and either: the Minister has not given a notice under paragraph 91F(1)(a) to the non-citizen; or the Minister has given such a notice but the period mentioned in that paragraph has ended and the non- citizen has not, during that period, made a valid application for a substantive visa that can be granted when the applicant is in the migration zone. (8) An officer must remove as soon as reasonably practicable an unlawful non-citizen if: the non-citizen is a detainee; and Subdivision AJ of Division 3 of this Part applies to the non- citizen; and either: the Minister has not given a notice under subsection 91L(1) to the non-citizen; or the Minister has given such a notice but the period mentioned in that subsection has ended and the non- citizen has not, during that period, made a valid application for a substantive visa that can be granted when the applicant is in the migration zone. (9) An officer must remove as soon as reasonably practicable an unlawful non-citizen if: the non-citizen is a detainee; and Callinan Subdivision AK of Division 3 of this Part applies to the non- citizen; and either: the non-citizen has not been immigration cleared; or the non-citizen has not made a valid application for a substantive visa that can be granted when the applicant is in the migration zone; and either: the Minister has not given a notice under subsection 91Q(1) to the non-citizen; or the Minister has given such a notice but the period mentioned in that subsection has ended and the non- citizen has not, during that period, made a valid application for a substantive visa that can be granted when the applicant is in the migration zone. (10) For the purposes of subsections (6) to (9), a valid application under section 137K for revocation of the cancellation of a visa is treated as though it were a valid application for a substantive visa that can be granted when the applicant is in the migration zone." The appellant's argument relied to a substantial extent upon the decision and some statements made in this Court in Chu Kheng Lim v Minister for Immigration181. There, the detainees had argued that the purpose of the Act was, invalidly, to authorize, indeed compel members of the Executive to arrest and detain by imprisoning them, persons otherwise than by order of a court exercising judicial power: that the detention was in short therefore punitive. By a majority the Court held that the relevant provision of the Act, s 54R, was invalid because it purported to direct the courts about the manner of exercise of their judicial power. Here the appellant argued that his detention was unlawful by reason of the conditions of it, allegedly of squalor, deprivation, overcrowding and harshness, and amounting therefore to punishment. I should immediately point out that these allegations are denied and have not been the subject of any forensic contest. It should also be observed that much of the material upon which the appellant would wish to rely may not be admissible in evidence, both as to form and 181 (1992) 176 CLR 1. Callinan substance. It is not entirely clear whether the appellant was also seeking to make a case of the same kind as the non-governmental parties in Al-Kateb v Godwin182 and Minister for Immigration and Multicultural and Indigenous Affairs v Al Khafaji183, that indefiniteness of detention deemed their detention unlawful. Nothing was however proved about the prospects or otherwise of deportation of the appellant to some other country, and accordingly the arguments advanced in those cases have no application to him. If they did I would reject them for the same reasons as I do in those cases. The statements in Lim upon which the appellant based his case need to be put in context. That context includes this statement as to the breadth of the aliens power in the joint judgment of Brennan, Deane and Dawson JJ184: "The legislative power conferred by s 51(xix) with respect to 'aliens' is expressed in unqualified terms. It prima facie encompasses the enactment of a law with respect to non-citizens generally. It also prima facie encompasses the enactment of a law with respect to a particular category or class of non-citizens, such as non-citizens who are illegal entrants or non-citizens who are in Australia without having presented a visa or obtained an entry permit. Such a law may, without trespassing beyond the reach of the legislative power conferred by s 51(xix), either exclude the entry of non-citizens or a particular class of non-citizens into Australia or prescribe conditions upon which they may be permitted to enter and remain; and it may also provide for their expulsion or deportation.185" Passages to and upon which the appellant points and relies are as follows186: "There are some qualifications which must be made to the general proposition that the power to order that a citizen be involuntarily confined 182 [2004] HCA 37. 183 [2004] HCA 38. 184 (1992) 176 CLR 1 at 25-26. 185 See, eg, Robtelmes v Brenan (1906) 4 CLR 395 at 400-404, 415, 420-422; Ex parte Walsh and Johnson; In re Yates (1925) 37 CLR 36 at 83, 94, 108, 117, 132-133; O'Keefe v Calwell (1949) 77 CLR 261 at 277-278, 288; Koon Wing Lau v Calwell (1949) 80 CLR 533 at 555-556, 558-559; Pochi v Macphee (1982) 151 CLR 101 at 186 (1992) 176 CLR 1 at 28-29, 33. Callinan in custody is, under the doctrine of the separation of judicial from executive and legislative powers enshrined in our Constitution, part of the judicial power of the Commonwealth entrusted exclusively to Ch III courts. The most important is that which Blackstone himself identified … namely, the arrest and detention in custody, pursuant to executive warrant, of a person accused of crime to ensure that he or she is available to be dealt with by the courts. Such committal to custody awaiting trial is not seen by the law as punitive or as appertaining exclusively to judicial power. Even where exercisable by the Executive, however, the power to detain a person in custody pending trial is ordinarily subject to the supervisory jurisdiction of the courts, including the 'ancient common law' jurisdiction, 'before and since the conquest', to order that a person committed to prison while awaiting trial be admitted to bail187. Involuntary detention in cases of mental illness or infectious disease can also legitimately be seen as non-punitive in character and as not necessarily involving the exercise of judicial power. Otherwise, and putting to one side the traditional powers of the Parliament to punish for contempt188 and of military tribunals to punish for breach of military discipline189, the citizens of this country enjoy, at least in times of peace190, a constitutional immunity from being imprisoned by Commonwealth authority except pursuant to an order by a court in the exercise of the judicial power of the Commonwealth. In the light of what has been said above, the two sections will be valid laws if the detention which they require and authorize is limited to what is reasonably capable of being seen as necessary for the purposes of deportation or necessary to enable an application for an entry permit to be made and considered. On the other hand, if the detention which those sections require and authorize is not so limited, the authority which they purportedly confer upon the Executive cannot properly be seen as an 187 See Blackstone, Commentaries, 17th ed (1830), bk 4 par 298. 188 See R v Richards; Ex parte Fitzpatrick and Browne (1955) 92 CLR 157; Polyukhovich v The Commonwealth (1991) 172 CLR 501 at 626. 189 See R v Bevan; Ex parte Elias and Gordon (1942) 66 CLR 452; Re Tracey; Ex parte Ryan (1989) 166 CLR 518; Re Nolan; Ex parte Young (1991) 172 CLR 460; Polyukhovich v The Commonwealth (1991) 172 CLR 501 at 626-627. 190 It is unnecessary to consider whether the defence power in times of war will support an executive power to make detention orders such as that considered in Little v The Commonwealth (1947) 75 CLR 94. Callinan incident of the executive powers to exclude, admit and deport an alien. In that event, they will be of a punitive nature and contravene Ch III's insistence that the judicial power of the Commonwealth be vested exclusively in the courts which it designates." The next passage upon which the appellant relies should be set out191: "The powers of detention in custody which are conferred upon the Executive by ss 54L and 54N are limited by a number of significant restraints imposed by other provisions of Div 4B. Section 54Q effectively limits the total period during which a designated person can be detained in custody under Div 4B to a maximum total period of 273 days after the making of an application for an entry permit. For the purposes of that maximum period, time does not run while events beyond the control of the Department, such as delay in the supply of information or delay in court or tribunal proceedings, are preventing the finalization of the entry application. Section 54P(2) requires that a designated person be removed from Australia as soon as practicable after he or she has been in Australia for at least two months (or a longer prescribed period) without making an entry application. Section 54P(3) requires the removal of a designated person from Australia as soon as practicable after the refusal of an entry application and the finalization of any appeals against, or reviews of, that refusal. Those limitations upon the executive powers of detention in custody conferred by ss 54L and 54N go a long way towards ensuring that detention under those powers is limited to what is reasonably capable of being seen as necessary for the purposes of deportation or to enable an entry application to be made and considered. circumstances where the facts of the present case demonstrate that Div 4B could authorize detention in custody for a further 273 days of persons who had already been unlawfully held in custody for years before the commencement of the Division, those limitations would not, in our view, have gone far enough were it not for the provision of s 54P(1)." Nonetheless, It is upon the next paragraph however that the appellant seeks to place the greatest emphasis192: "Ours is a Constitution 'which deals with the demarcation of powers, leaves to the courts of law the question of whether there has been any excess of power, and requires them to pronounce as void any act 191 (1992) 176 CLR 1 at 33. 192 (1992) 176 CLR 1 at 36. See also at 10 per Mason CJ, 58 per Gaudron J, 65 and 71 Callinan which is ultra vires'193. All the powers conferred upon the Parliament by s 51 of the Constitution are, as has been said, subject to Ch III's vesting of that judicial power in the courts which it designates, including this Court. That judicial power includes the jurisdiction which the Constitution directly vests in this Court in all matters in which the Commonwealth or a person being sued on behalf of the Commonwealth is a party194 or in which mandamus, prohibition or an injunction is sought against an officer of the Commonwealth195. A law of the Parliament which purports to direct, in unqualified terms, that no court, including this Court, shall order the release from custody of a person whom the Executive of the Commonwealth has imprisoned purports to derogate from that direct vesting of judicial power and to remove ultra vires acts of the Executive from the control of this Court. Such a law manifestly exceeds the legislative powers of the Commonwealth and is invalid. Moreover, even to the extent that s 54R is concerned with the exercise of jurisdiction other than inconsistent with Ch III." (emphasis added) this Court's directly vested constitutional jurisdiction, It is the appellant's principal submission that if the conditions of his detention can be shown to be inhumane in fact, the detention is in substance punitive no matter how it is described, and indeed, regardless of any expressed purpose. As to this, the respondents' argument should be accepted: that the appellant's submission conflates two separate issues, of the unlawful authority to detain, on the one hand, and of the conditions within detention on the other. The constitutional requirement of the exercise of judicial power by the judiciary is only infringed if the conferral of authority to detain does not fall within an exceptional class not of a punitive character. The question whether the law authorizing detention (and saying nothing about the conditions of it) is reasonably capable of being seen as necessary for a legitimate purpose within the aliens power, cannot be concerned with a qualitative assessment of the conditions of detention. It is concerned with the purpose of the law authorizing detention. The appellant accepts that the Act and the detention under it do not deprive him of his right to sue in tort or to pursue other causes of action generally available to citizens and others in the community. Similarly, it may be that remedies would be available for infringement of, or failure to comply with, regulations or guidelines (if any) governing or affecting immigration detention. 193 R v Richards; Ex parte Fitzpatrick and Browne (1955) 92 CLR 157 at 165 per Dixon CJ, McTiernan, Williams, Webb, Fullagar, Kitto and Taylor JJ. 194 Constitution, s 75(iii). 195 Constitution, s 75(v). Callinan The Act certainly provides no charter for detention in brutal conditions196. As Gray J said197 in his reasons, "[t]he custodians of detainees are legally accountable." This Court has not been called upon to correct, or to compel compliance with any arrangements whether made by regulation or otherwise, for the humane detention of aliens. This can be compared and contrasted with the decision of the Supreme Court of the United States in Bell v Wolfish198 (a case of pre-trial detention) upon which the appellant relied. There, the Court left open the possibility of habeas corpus to review and correct conditions of confinement in breach of constitutional guarantees of that nation, but not to permit release from detention. The Court said199: "[t]the parties concede that to ensure their presence at trial, these persons legitimately may be incarcerated by the Government prior to a determination of their guilt or innocence ... it is the scope of their rights during this period of confinement prior to trial that is the primary focus of this case." (emphasis added) It is unnecessary to decide the extent to which the reasoning and decision in that case were influenced by constitutional guarantees of that country of a kind not to be found in the Australian Constitution, and its jurisprudence in relation to them. The case here is of a quite different kind in any event. The appellant seeks to strike down, or at least read down, s 198 of the Act on constitutional grounds, for infringement of Ch III of the Constitution. What was said by Lord Bridge of Harwick in R v Deputy Governor of Parkhurst Prison; Ex parte Hague, although a case of imprisonment by judicial order, is of some relevance here200: 196 To the extent to which detention centres established under the Act are located in a Commonwealth place, State laws will be applied as Commonwealth laws by virtue of the operation of the Commonwealth Places (Application of Laws) Act 1970 (Cth). 197 Secretary, Department of Immigration and Multicultural and Indigenous Affairs v Behrooz (2002) 84 SASR 453 at 472 [70]. 199 441 US 520 at 523 (1979). 200 [1992] 1 AC 58 at 165. Callinan "... the proposition that the conditions of detention may render the detention itself unlawful raises formidable difficulties. If the proposition be sound, the corollary must be that when the conditions of detention deteriorate to the point of intolerability, the detainee is entitled immediately to go free. It is impossible, I think, to define with any precision what would amount to intolerable conditions for this purpose. ... The law is certainly left in a very unsatisfactory state if the legality or otherwise of detaining a person who in law is and remains liable to detention depends on such an imprecise criterion and may vary from time to time as the conditions of his detention change." Conditions of detention cannot invalidate the grant and exercise of the power to detain in immigration detention. I would also conclude that the summonses should be set aside on the ground of oppression as the meaning of that ground has been explained in The Commissioner for Railways v Small201. On their face the appellant seeks an enormous amount of material. The width is breathtaking, for example: any documents "which contain or refer to complaints or concerns about conditions in Woomera" or "contain concerns of or criticisms by [various bodies who have no authority under Australian law to prescribe conditions of detention in this country] regarding the conditions of detention at Woomera". The summonses are imprecise in their terms. What is sought goes far beyond what might legitimately be sought as part of, or even as leading to a train of inquiry. The summonses are of a fishing nature. They assume matters, for example that there are documents in existence in relation to, and that there have been or there should have been, programmes designed to meet the separate needs of the appellant and other detainees. Having regard to their multiple deficiencies, it would not be for this Court to seek to salvage something from them that could properly be the subject of a valid summons. For these further reasons the summonses should have been wholly set aside. The appeal should be dismissed with costs. 201 (1938) 38 SR (NSW) 564 at 574-575 per Jordan CJ.

HIGH COURT OF AUSTRALIA TRUST COMPANY OF AUSTRALIA LTD APPELLANT AND COMMISSIONER OF STATE REVENUE RESPONDENT Trust Company of Australia Ltd v Commissioner of State Revenue [2003] HCA 23 1 May 2003 ORDER 1. Appeal allowed with costs. 2. Set aside the orders made by the Queensland Court of Appeal dated 20 July 2001 and, in place thereof, order that: (i) the questions in the Case Stated be answered as follows: Question (a): is the Form 1 Transfer (Annexure "D") an instrument whereby property was conveyed, transferred or assigned to or was vested in the person within the meaning of s 49(1)(a) of the Stamp Act 1894? Answer: yes. Question (b): if "yes" to (a), is the Assessment Notice issued 27 March, 2000 the result of a reassessment by the Commissioner pursuant to s 80 of that Act? Answer: unnecessary to answer. Question (c): if "yes" to (b), is the original assessment that which is contained in the document entitled "ASSESSMENT NOTICE", bearing Lodgement Number 011 858 466 - 9 and, if so, is such assessment the result of the forming of the opinion by the Commissioner pursuant to s 22(2)(a) of that Act that the Form 1 Transfer was not chargeable with any duty because of s 54(6) of that Act consequent upon duty having been paid on the Contract of Sale (Annexure "C")? Answer: unnecessary to answer. Question (d): if "yes" to (c), is the assessment of the Commissioner, contained in the Assessment Notice issued 27 March, 2000, on the Form 1 Transfer instrument valid? Answer: unnecessary to answer. Question (e): if "no" to (b), should the appellant be entitled to the benefit of the application of s 54(6) of that Act? Answer: the condition in the question may be ignored and the balance of the question answered "yes". Question (f): is the assessment of the Commissioner contained in the Assessment Notice issued 27 March, 2000 in the sum of $653,475.00 on the Form 1 Transfer instrument correct and, if not, what duty, if any, is payable? Answer: No, and s 54(6) takes effect according to its terms. Question (g): how should the costs of and incidental to the stating of this case and of the appeal be borne and paid? Answer: the costs of and incidental to the stating of the case and the appeal should be borne by the Commissioner of State Revenue. (ii) costs of and incidental to the proceedings in the Queensland Court of Appeal to be borne by the Commissioner of State Revenue. On appeal from the Supreme Court of Queensland McHugh Kirby Hayne Callinan Representation: D G Russell QC with M L Robertson for the appellant instructed by Creagh Weightman Lawyers) K D Dorney QC with D Marks for the respondent (instructed by Crown Solicitor for the State of Queensland) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Trust Company of Australia Ltd v Commissioner of State Revenue Stamp duties – Where land intended to be subject of managed investment scheme – Contract of sale between vendor, responsible entity of scheme and custodian of scheme property – Transfer pursuant to contract made to custodian alone – Ad valorem duty paid on contract – Whether transfer liable to ad valorem duty – Whether transfer to custodian was a transfer made to the purchaser within s 54(6) Stamp Act 1894 (Q). Words and Phrases: "made to the purchaser". Managed Investments Act 1998 (Cth). Stamp Act 1894 (Q), ss 54(1), 54(3), 54(6), 54(6A). GLEESON CJ. This is an appeal from a decision of the Court of Appeal of the Supreme Court of Queensland (McMurdo P, Thomas JA, Helman J)1. The issue in the case concerns stamp duty on a contract for sale, and then on a transfer, of land intended to be the subject of a managed investment scheme. The Managed Investments Act 1998 (Cth), required the appointment of an independent party (in this case, the appellant) to acquire and hold scheme property. In order to determine whether that resulted in liability to two amounts of ad valorem duty, it became necessary to apply s 54 of the Stamp Act 1894 (Q) ("the Stamp Act"). The Stamp Act has since been repealed. Moreover, the particular problem revealed by this case was later dealt with by special legislation2. However, the present case must be resolved by reference to the Stamp Act in the form it took at the time. There were three parties to the contract of sale. Riverfront Developments Pty Ltd was described in the contract as Vendor. Cromwell Property Securities Ltd ("Cromwell") was described as Purchaser. The appellant was described as Custodian. A Custody Agreement previously entered into between Cromwell and the appellant was annexed to the contract. The land the subject of the contract was to be scheme property of a managed investment scheme. The central question is whether the transfer of the land to the appellant pursuant to the contract was a transfer made to the purchaser, within the meaning of s 54(6) of the Stamp Act. If it was, then, ad valorem duty having been paid upon the contract, it was not further payable upon the transfer. If it was not, then ad valorem duty was also payable upon the transfer. The facts, and legislative provisions, are set out in the reasons of Gummow and Hayne JJ, and Callinan J. I will refer to them only to the extent necessary to explain my conclusion. The provisions of the contract of sale were not perfectly consistent. However, the respective roles of Cromwell and the appellant were evidently intended to give effect to the Custody Agreement, which was referred to in, and annexed to, the contract, and which formed the commercial setting for the transaction. The purchase price was $17,500,000. The deposit was to be paid by the Purchaser. Special Condition 12, dealing with payment of the balance of purchase price, contained an irrevocable direction from the vendor to Cromwell as Purchaser and the appellant as Custodian to pay the amount payable on 1 Trust Company of Australia Limited v Commissioner of Stamp Duties (2001) 47 ATR 418. 2 Revenue Laws Amendment Act 2000 (Q), s 29. completion in a certain manner. Special Condition 11, headed "Limitation of Liability", contained the following provision: The Vendor acknowledges and agrees that the Purchaser and the Custodian enter into this Contract only in their capacity as Responsible Entity and Custodian respectively of the Scheme and in no other capacity. Any liability of the Purchaser and the Custodian arising under or in connection with this Contract is strictly limited to the extent to which (and can be enforced against the Purchaser and the Custodian only to the extent to which) it can be satisfied out of property of the Scheme out of which the Purchaser and the Custodian are actually indemnified for the liability." The same Special Condition also provided: The Vendor and the Purchaser acknowledge that the Custodian is a party to this Contract solely for the purpose of accepting a transfer of the Property in its capacity as Custodian of the Riverfront Planned Investment ('the Scheme') pursuant to a Custody Agreement ... a copy of which is annexed to this Contract ..." The Custody Agreement, in cl 4, identified the responsibilities of the Custodian. They included a duty "to enter into a contract to purchase the Scheme Property", and "to hold the Scheme Property ... on [Cromwell's] behalf". At first sight, the Custody Agreement might suggest that, as between Cromwell and the appellant, it was only the appellant which would enter into the contract to purchase the scheme property. That would be consistent with the language of cl 4 of the Custody Agreement. However, the purchase price was being provided by, or at least through, Cromwell, and the property was to be acquired and held by the appellant as trustee for Cromwell. Cromwell would in turn be bound by the trusts of the managed scheme. As Special Condition 11.6 of the contract of sale acknowledged, neither Cromwell nor the appellant was to be the beneficial owner of the land, and both of them contracted only in their respective capacities under the managed investment scheme. One thing is clear. As between Cromwell and the appellant, on completion of the contract the appellant was entitled to a transfer of the subject land in its own capacity, and not merely as nominee of Cromwell. It was of the essence of the managed scheme that legal title to the subject property would be acquired by the appellant, and not by Cromwell. Clause 4(b) of the standard conditions of contract, as amended, provided that, on completion, there would be delivered "a properly executed transfer of the Land from the Vendor to the Custodian". If it had become necessary for the Vendor to bring an action for specific performance of the contract of sale, then both Cromwell and the appellant would have been necessary parties to the proceedings3. The framing of an order for payment of the balance of purchase price would have been complicated by the contractual provisions set out above. Subject to the limitation of liability contained in Special Condition 11, the effect of Special Condition 12, read together with the references in the Custody Agreement to the responsibilities of the appellant, would be to justify an order against both defendants. And the order would have contained a requirement that the balance of the purchase price be paid upon delivery of a transfer of the subject land to the appellant4. That is the contractual context in which the provisions of s 54 of the Stamp Act must be applied. The relevant provisions are sub-ss 54(1), (3), (6) and (6A). The following features may be noted. First, s 54(1) imposes ad valorem duty, not only on a contract for the sale of property, but also on any contract whereby any person becomes entitled, or may become entitled, to the conveyance or transfer of any property. Such a contract might not necessarily involve any dealing of a kind that could ordinarily be described as a purchase. Nevertheless, ad valorem duty is imposed; and the question then arises as to how the Act deals with duty on a transfer to the person entitled under the contract. That question is addressed (if it is addressed at all) by sub-s (6). Secondly, s 54(3) deems an option to purchase, for the purposes of s 54, to be an agreement for sale of the subject property, and attracts ad valorem duty accordingly. Once again, the grantee of the option would not ordinarily be described, at least at that stage, as a purchaser, but ad valorem duty is paid and the same question arises when a transfer is executed in favour of the grantee of the option. Thirdly, s 54(6) provides that, where duty has been paid in conformity with the foregoing provisions, the transfer made to the purchaser shall, upon production of the stamped contract, not be chargeable with any duty. The clear intent is to negate liability for double duty where a contract is charged with ad valorem duty, and then there is a transfer pursuant to the contract, where it can be described as a transfer to the purchaser. 3 Fry on Specific Performance, 6th ed (1921) at 75, 639. 4 Seton, Forms of Judgments and Orders, 7th ed (1921), vol 3 at 2171. Fourthly, s 54(6A) provides that s 54(6) does not apply in respect of a transfer made to a person other than the person named as purchaser in the contract to which the transfer is intended to be pursuant unless the commissioner is satisfied that the person named in the contract as purchaser was acting as agent for the transferee. The argument for the respondent, upheld in the Court of Appeal, is that, in the present case, Cromwell was the only party capable of being described as "the purchaser" within the meaning of s 54(6); the transfer to the appellant executed pursuant to the contract was not a transfer "made to the purchaser"; and therefore s 54(6) had no application. This conclusion, it is said, is reinforced by s 54(6A), which refers, in connection with s 54(6), to "the person named as purchaser in the contract". In my view, that argument depends upon an over-simplification of both the contract and s 54. As was noted above, the contract referred to, and reflected, the managed scheme, which was its genesis, and the respective roles of the appellant and Cromwell Property Securities Ltd in that scheme. Although the contract described Cromwell as Purchaser and the appellant as Custodian, they would both have been necessary parties to an action for specific performance. Subject to the limitations of their liability, an order for the payment of the purchase price could have been made against both. That order would have been conditional upon the delivery by the vendor of a transfer to the appellant as Custodian. In those circumstances, quite apart from the scheme of s 54, it is far from clear that Cromwell is correctly described as the purchaser, to the exclusion of the appellant. When regard is had to their roles, and their respective rights and obligations, under the contract, the appellant has as much claim as Cromwell to be identified as the purchaser. Section 54(6), as its introductory words make plain, applies to the whole of s 54(1), and also to s 54(3). The expression "the purchaser" must be construed as being sufficiently flexible to enable it to have that application. In relation to what might be described as the second limb of s 54(1), if there is a contract whereby a person becomes entitled to a transfer of property, and the contract is charged with ad valorem duty, and a transfer is made to that person, then, either there is relevantly a transfer made to the purchaser, or s 54(6) would have no application. In relation to s 54(3), the grantee of an option is not, under the option agreement, a purchaser, yet s 54(6) appears to be intended to apply to a transfer to such a person if the option agreement has been charged with ad valorem duty as a contract. I do not regard it as necessary for the appellant to rely on the second limb of s 54(1); although it would be available. Rather, I refer to the second limb of s 54(1), and to s 54(3), to indicate the need to give a sufficiently flexible interpretation to s 54(6) in order to enable it to achieve its evident purpose. This seems to me to be consistent with, and required by, ordinary principles of statutory construction. To give the word "purchaser" in s 54(6) a narrow and inflexible interpretation would deprive it of its capacity to achieve its manifest purpose. It would apply to only part of s 54(1), and not at all to s 54(3). It requires a degree of flexibility. Furthermore, the contract to which it must be applied in the present case is one in which the search for a single "purchaser" does not yield an unequivocal answer. In my view, having regard to the structure of the contract, the first limb of s 54(1) can be applied, and for the purposes of s 54(6), it can be concluded that the transfer to the appellant was a transfer made to the purchaser. The definite article in s 54(6) does not require that, where there are two potential candidates for the description, one of them must be identified as purchaser to the exclusion of the other. That would serve no legislative purpose. To treat the appellant as purchaser conforms to the purpose of s 54(6), and does no violence to the language. Section 54(6A), although in form expressed as a qualification to s 54(6), in substance expands its operation, subject to a certain condition. It does not narrow the meaning of s 54(6), but deals with a particular issue, that is to say, agency. It was said on behalf of the respondent that the argument for the appellant amounted, in effect, to the contention that s 54(6) would apply in any case in which a transfer was made in conformity with the contract of sale. There is more to the present case than that. The role of the appellant, the nature of the appellant's responsibilities under the Custody Agreement annexed to the contract of sale, the obligation to pay the balance of purchase price, and the right to receive a transfer as a condition of payment of the price, mean that the transfer was a transfer made to the purchaser, with the result that s 54(6) is satisfied. The appeal should be allowed with costs. I agree with the consequential orders proposed by Gummow and Hayne JJ. ("TCA") challenged an assessment by GUMMOW AND HAYNE JJ. The appellant, Trust Company of Australia ("the Limited Commissioner") to duty under the Stamp Act 1894 (Q) ("the Act")5, in the sum of $653,475 upon a Form 1 transfer under the Land Title Act 1994 (Q) ("the Transfer"). That instrument was dated 29 November 1999 and it identified Riverfront Developments Pty Ltd ("Riverfront") as transferor and TCA as transferee. These were the only parties to the instrument. The subject property was the land and improvements at 301 Coronation Drive, Milton ("the Land"). The purchase price was $17.5 million. respondent the Section 24 of the Act establishes a procedure to test in the Supreme Court of Queensland the decision of the Commissioner upon an objection to an assessment. This involves the stating by the Commissioner of a case setting out the questions submitted for judicial determination. The present Case Stated was heard in the first instance by the Court of Appeal. Stamp duty is charged by s 4 of the Act upon the several instruments and at the rates specified in Sched 1, subject to any applicable exemption. The duty is payable by each and every person who signs or executes the instrument in question (s 26(1)(a)). One of the headings in Sched 1 is "Conveyance or Transfer". The Transfer was made on completion of a contract of sale ("the Contract") made the same day. The parties to the Contract were identified therein as Riverfront as the "Vendor", Cromwell Property Securities Limited ("Cromwell") as "Purchaser" and TCA as "Custodian". Pursuant to the terms of the Contract, the purchase price was paid in exchange for a properly executed transfer from Riverfront to TCA. The Commissioner assessed the Contract and the Transfer to duty in each case in the sum of $653,475. The Commissioner determined that an "exemption" pursuant to s 54(6) of the Act did not apply to the transfer to TCA because that transfer had not been made to the "purchaser" under the Contract. The "purchaser" spoken of in s 54(6) was, so the Commissioner determined, Cromwell, not TCA, and Cromwell was not a party to the transfer. 5 The Act was repealed by s 509 of the Duties Act 2001 (Q), but s 512 thereof provides for the continued application of the repealed statute to instruments executed before the commencement of the new statute. The Court of Appeal (McMurdo P, Thomas JA, Helman J) answered the questions in the Case Stated in a manner favourable to the position adopted by the Commissioner6. The nature of the transaction When producing the Contract and the Transfer to the Commissioner, the solicitors for Cromwell had written to describe the nature of the transaction. Cromwell was the responsible entity and trustee for a syndicate of investors known as the Riverfront on Coronation Planned Investment Scheme ("the Scheme"). Pursuant to a document styled "Custody Agreement" and dated 4 October 1999 between Cromwell and TCA, TCA had been appointed Custodian of the assets of the Scheme. The solicitors wrote that that appointment was "a requirement of the Managed Investments Act amendments to the Corporations Law which require separation of legal and equitable title in Managed Investment Schemes". They added that the role of TCA was "limited to holder of the legal title pursuant to the [Custody] Agreement". Paragraphs (a) and (b) of cl 4.1 of the Custody Agreement stated the duties of the Custodian as including the entry into a contract to purchase the Land and to hold the Land "on [Cromwell's] behalf". At the material time, by force of changes introduced by the Managed Investments Act 1998 (Cth), Ch 5C (ss 601EA-601QB) of the Corporations Law ("the Law") made provision for the regulation of managed investment schemes. Provision also was made in Pt 7.3 (ss 780-840) of Ch 7 for the issue of licences authorising the operation of managed investment schemes. Section 784(2) empowered the Australian Securities and Investments Commission ("ASIC") to attach conditions to the grant of licences. A licence under s 784 was issued by a delegate of ASIC to Cromwell on 15 March 1999. Condition 10 required Cromwell not to hold scheme property of a registered scheme and to appoint another person to hold scheme property, unless there applied certain provisions relieving it from that obligation. The result in the present case appears to have been that TCA held the legal (ie registered) title to the Land on trust for Cromwell which, in turn, was trustee of the equitable title in favour of the syndicate of investors whose moneys had funded the purchase of the Land7. 6 Trust Company of Australia Limited v Commissioner of Stamp Duties (2001) 47 ATR 418. 7 Comptroller of Stamps (Vict) v Howard-Smith (1936) 54 CLR 614 at 621-622. In the Court of Appeal, Thomas JA said8: "In this matter the Commissioner has exacted ad valorem stamp duty twice in respect of what was in substance a single sale of property. The relevant parties did not seek to avoid duty on the sale of the property or engage in manoeuvres for any extraneous purpose. In relation to the acquisition of a property they simply followed the rather complicated requirements of the [Law] and the Managed Investments Act 1998 (Cth) which are designed to protect members of the public in relation to managed investment schemes. Those provisions require the appointment of a 'custodian' to hold the relevant property. The State of Queensland has now apparently recognised the undesirability of subjecting entities to additional duties by reason of their compliance with such statutory requirements. There is now an express exemption applicable to a situation such as the present one9. However, this provision only took effect on 17 November 2000 and is not retrospective." The Contract Before turning to consider the text and construction of the relevant provisions of the Act, it is convenient to identify more fully the salient provisions of the Contract. For the purposes of the application of the Act, what is essential is the legal characterisation of the obligations provided in the Contract, not the identification of the labels used therein as a means of identification of the particular parties. What is to be ascertained is "the real and true meaning" of the instrument sought to be brought to duty10. The Contract was based upon the first edition of the form adopted by the Real Estate Institute of Queensland Limited and approved by the Queensland Law Society Incorporated for conveyances of Torrens title, Crown leasehold title of commercial land, buildings and units. The Contract incorporated standard conditions identified as the "Standard Commercial Conditions". These were then (2001) 47 ATR 418 at 420. 9 Revenue Laws Amendment Act 2000 (Qld); see Explanatory Notes 2000 at 1708, 10 Limmer Asphalte Paving Co v Commissioners of Inland Revenue (1872) LR 7 Ex amended by Annexure A to the Contract. Reading these provisions together, the following emerges. TCA was identified as "Custodian", Riverfront as "Vendor" and Cromwell as "Purchaser". The balance of the purchase price was to be paid on completion in exchange for a properly executed transfer of the Land from the Vendor to the Custodian (cl 4(b)). The Vendor was required to do all acts and to execute all documents necessary for the purpose of completing the sale and ensuring that the Custodian obtained good and valid title to the Land (cl 10.1). If the Purchaser failed to pay the balance of the purchase price as provided in cl 4, then the Vendor was empowered to terminate the contract (cl 13.1). Clauses 11.4 and 11.5 of the "Special Conditions" of the Contract contained respectively covenants by the Custodian to do all things required of it under the Custody Agreement to enable the Purchaser to observe and perform its obligations under the Contract, and by the Purchaser to do all things, including the giving of instructions to the Custodian, to enable the Custodian to comply with its obligations under the Contract. Clause 11.3 contained an acknowledgment by the parties that the rights of the Purchaser and the Custodian under the Contract were several and not joint or joint and several. The Purchaser acknowledged that the consideration for the payment of the purchase price to the Vendor was satisfied by the Vendor complying with the requirement under cl 4(b) for a transfer to the Custodian (cl 11.2). Finally, cl 11.1 stated that the Vendor and Purchaser acknowledged that the Custodian was a party to the Contract "solely for the purpose of accepting a transfer of the Property in its capacity as Custodian of [the Scheme] pursuant to [the] Custody Agreement". The contractual relationships The Contract thus was so framed as immediately to create tripartite relationships. This was not, for example, the case of a contract between Riverfront and Cromwell with TCA, by subsequent arrangement, becoming a sub-purchaser from Cromwell. There was to be but one transaction, the terms for the performance of which were fixed from the outset and between all the actors. That situation may be contrasted with the various situations considered by Aickin J in Lord v Trippe11. His Honour referred to the proposition by Sir George Jessel MR in Earl of Egmont v Smith12 that: 11 (1977) 51 ALJR 574 at 582; 14 ALR 129 at 143-144. 12 (1877) 6 Ch D 469 at 474. "[a]n ordinary contract of sale is not only to convey to the purchaser, but to convey as the purchaser shall direct." Here, there was but one obligation expressly stipulated as to conveyance and that was conveyance in favour of the Custodian; the conveyance that was made thus was not in exercise of any power to direct a conveyance but in discharge of an obligation to convey to a particular party to the Contract itself. Aickin J also referred to13: "a common enough practice in real estate transactions for the contract itself to provide that the transfer is to be made to the purchaser or his nominee, but that gives a power to substitute or nominate a different transferee, not a different contracting party. The vendor becomes bound to transfer to the nominee upon the purchaser paying or procuring the payment of the purchase money and otherwise complying with the terms of the contract." Again, the Vendor at all times under the Contract was bound to transfer to the Custodian because the Contract so stipulated, not because there was a subsequent nomination of the Custodian by the Purchaser. Finally, Aickin J referred to another quite different situation, that where14: "a purchaser under a contract of sale may, in the absence of special circumstances, assign his interest in the contract and the assignee then becomes entitled to all the rights of the purchaser upon notice being given to the vendor. The vendor has, in this sense also, a right to nominate a transferee to take the transfer of the property comprised in the contract." Arrangements falling within one or other of these categories possibly may give rise to issues in assessment for stamp duty under s 54 and other provisions of the Act15. But they would not be the issues which arise on this appeal. 13 (1977) 51 ALJR 574 at 582; 14 ALR 129 at 143. 14 (1977) 51 ALJR 574 at 582; 14 ALR 129 at 144. 15 cf Lake Victoria Ltd v Commissioner of Stamp Duties (1949) 49 SR (NSW) 262; Vickery v Woods (1952) 85 CLR 336. Section 54 The provisions of s 54 immediately relevant to the issues on this appeal are as follows: "(1) Any contract or agreement for sale of any property or any contract or agreement whereby a person becomes entitled or may, provided the terms and conditions thereof are met, become entitled to the conveyance or transfer of any property shall be charged with the same duty as if it were an instrument of conveyance of the property. (6) Where duty has been duly paid in conformity with the foregoing provisions, the conveyance or transfer or conveyances or transfers made to the purchaser shall upon production of the contract or agreement or contracts or agreements, duly stamped not be chargeable with any duty, and the commissioner, upon application, either shall denote the payment of the ad valorem duty upon the conveyance or transfer or conveyances or transfers, or shall transfer the ad valorem duty thereto." (emphasis added) The terms "conveyance" and "transfer" include every instrument whereby property is conveyed, transferred or assigned to or is vested in any person Provisions such as s 54 have a long history in revenue law. This appears to have begun in the United Kingdom with s 18 of the Customs and Inland Revenue Act 1889 (UK)16 which was repealed and replaced by s 15 of the Revenue Act 1889 (UK)17, in turn replaced by s 59 of the Stamp Act 1891 (UK)18. These provisions were introduced to remedy a perceived defect in s 70 of the Stamp Act 1870 (UK)19, which had been disclosed by the decision in The Commissioners of Inland Revenue v G Angus & Co20. 16 52 Vict c 7. 17 52 & 53 Vict c 42. 18 54 & 55 Vict c 39. 19 33 & 34 Vict c 97. 20 (1889) 23 QBD 579. See Piper, The Stamp Laws and Duties, (1912) at 195; Sergeant and Sims on Stamp Duties and Capital Duty and Stamp Duty Reserve Tax, 9th ed (1988) at 143-144. In its original form, s 54(1) of the Act provided: "Any contract or agreement made in the Colony of Queensland, under hand and seal or under seal only, or under hand only, for the sale of any equitable estate or interest in any property whatsoever, shall be charged with the same ad valorem duty to be paid by the purchaser as if it were an actual conveyance on sale of the estate, interest, or property contracted or agreed to be sold." The origin of the present s 54(6) is found in the original s 54(3): "Where duty has been duly paid in conformity with the foregoing provisions, the conveyance or transfer made to the purchaser or sub-purchaser, or any other person on his behalf or by his direction, shall not be chargeable with any duty, and the Commissioners, upon application, either shall denote the payment of the ad valorem duty upon the conveyance or transfer, or shall transfer the ad valorem duty thereto upon production of the contract or agreement, or contracts or agreements, duly stamped." The references in the original s 54(3) to sub-purchasers, those acting on behalf of another, and those taking by direction, have been removed. Counsel for the appellant carefully traced the series of legislative steps by which these and other changes to s 54 were brought about. However, the issue which arises on this appeal is best approached by turning immediately to construe sub-ss (1) and (6) of s 54 as they stood at the relevant time. It may be added that the conclusion yielded by that effort does not appear inconsistent with anything in the legislative history. Section 54(1) does not distinguish between contracts and agreements but does deal distinctly with (i) contracts or agreements for the sale of any property and (ii) contracts or agreements whereby a person becomes entitled to the conveyance or transfer of any property or may become so entitled provided the terms and conditions of the contract or agreement are met. It may be, as counsel for the appellant suggested, that category (ii) was introduced at least partly on the footing that category (i) dealt only with immediately executed rather than executory contracts or agreements. However that may be, the Contract fell within category (ii). Provided the terms and conditions thereof were met, for example, the tendering of the purchase money on completion, the Custodian became entitled to the transfer of the Land. That entitlement arose by reason of the terms and conditions of the Contract. That meant that the connecting factor made requisite by the term "whereby" in s 54(1) is satisfied. It followed that the Contract was properly charged with the same duty as if it had been an instrument of conveyance of the Land. No party suggests the contrary. The next step is to construe sub-s (6) in its relation to sub-s (1) in the circumstances of this case. The matters just discussed concerning the application here of sub-s (1) indicate that the condition precedent to the operation of sub-s (6) was satisfied. That condition is expressed by the words "[w]here duty has been duly paid in conformity with the foregoing provisions". The balance of sub-s (6) assumes and operates expressly upon the footing that in respect of the instrument attracting the payment of duty in conformity with sub-s (1), there will be a party to answer the statutory description "the purchaser" to whom a transfer of the land is made. The phrase "made to the purchaser" identified the Transfer made under and in performance of those provisions of the Contract whereby the Custodian became entitled to the Transfer. The term "the purchaser" in s 54(6) takes its colour not simply or exclusively from the law of vendor and purchaser, but from the earlier provisions of s 54, in particular, in this case, s 54(1). Section 54(1) is so drawn that a covenant under seal to transfer, unsupported by consideration, will attract duty under that provision. The transferee would not ordinarily be described as "the purchaser" but the transfer made in performance of the covenant would attract the operation of s 54(6) because duty had been paid in conformity with s 54(1). An understanding of the operation of s 54(6) may be further assisted by regard to s 54(3). This deals with options and states: "Where an agreement which creates an option or right of purchase of any property provides that such property, or any part thereof, shall be conveyed or transferred to any person pending the exercise of the option or right of purchase, or where, in connection with such an agreement, such property, or any part thereof, shall be, or be agreed in any other manner to be, so conveyed or transferred, the agreement creating the option or right of purchase shall, for the purposes of this section, be deemed to be an agreement for the sale of the whole of the property the subject of the option or right of purchase." As a deemed agreement for the sale of the whole of the property the subject of the option, the agreement becomes an agreement which attracts the charging of duty under s 54(1). The grantee of the option would not ordinarily be described as a "purchaser". That is not to deny to that party the character of "the purchaser" for the subsequent operation of s 54(6). Something also should be said respecting s 54(6A). This provides that s 54(6) may apply where the Commissioner is satisfied of various matters, even though the instrument is a conveyance or transfer made to a person other than the person named as purchaser in the contract or agreement of sale to which the conveyance or transfer is intended to be pursuant. Once it be concluded, as it should be, that, in the present case, TCA was "the purchaser" for the purposes of s 54(6), s 54(6A) is not engaged. Certainly s 54(6A) does not deny or qualify the beneficial operation s 54(6) already has. In the result, the construction of s 54(6) for which TCA contends should have been accepted by the Court of Appeal. Other authorities Something should be said of two authorities referred to in the judgments of the Court of Appeal and relied upon by the Commissioner. Each is a decision of this Court. Neither was concerned with the construction of the Act. The first decision is Dudley Buildings Pty Ltd v Rose21. This was a vendor and purchaser dispute. The Court was concerned with which of two persons who were, at various times, entitled to a transfer of certain lands and buildings in Melbourne, was the purchaser thereof at a particular time. The Court held that this was the person who had certain obligations in addition to the right to a transfer. Turning to the present appeal, TCA under the Contract had the right to a transfer of the Land and it covenanted for the benefit of Riverfront that it would do all things required of it under the Custody Agreement to enable Cromwell to observe and perform its obligations to Riverfront. Dudley Buildings does not assist the Commissioner. The second decision is Commissioner of Stamp Duties (NSW) v Pendal Nominees Pty Ltd22. The Court there was concerned with two provisions in the Stamp Duties Act 1920 (NSW). The first was s 17(1). This restated the general principle that an instrument containing or relating to several distinct matters is to be separately and distinctly charged with duty in respect of each of them. In that regard, reference was made23 to Limmer Asphalte Paving Co v Commissioners of Inland Revenue24. Nothing in the present case turns upon that rule of construction. The second provision in the New South Wales statute comprised certain paragraphs under the heading "Declaration of Trust" in the Second Schedule. These included the phrase "a person in whom property is vested as the apparent 21 (1933) 49 CLR 84. 22 (1989) 167 CLR 1. 23 (1989) 167 CLR 1 at 10, 24, 34. 24 (1872) LR 7 Ex 211 at 217. purchaser". But, whilst the judgments in Pendal were the subject of detailed examination in oral submissions on this appeal, the unsurprising result is that what was determined in Pendal is of no assistance in determining the construction of s 54 of the Act. Conclusions TCA emphasised in its submissions the statement by Dixon J in Executor Trustee & Agency Co of South Australia Ltd v Federal Commissioner of Taxation25 to the effect that unless the intention "is clear beyond any doubt", a taxing statute should not be interpreted in a fashion which "results in the imposition of double taxation". These remarks were made when dealing with an income tax case. The statute with which the Court is presently concerned relevantly imposes a duty upon particular instruments rather than overall transactions. Therefore it may be a little difficult to rely upon detestation of double taxation as a guiding principle of statutory construction. It is true, as Thomas JA pointed out in the passage set out earlier in these reasons, that the Commissioner seeks to recover ad valorem stamp duty twice in respect of what in substance was but one sale by Riverfront of the Land. Nevertheless, the conclusion that the submissions of TCA should be accepted in preference to those of the Commissioner has been reached directly upon the construction of s 54, and without regard to any overriding or general considerations of the nature referred to by Dixon J. Orders The appeal should be allowed with costs. The orders made by the Court of Appeal should be set aside and in place thereof it should be ordered that the appeal to that Court be allowed and that the questions in the Case Stated be answered as follows: "Yes." (b), (c), (d) Unnecessary to answer. "The condition in the question may be ignored and the balance of the question answered 'Yes'." "No, and s 54(6) takes effect according to its terms." 25 (1932) 48 CLR 26 at 44. "The costs of and incidental to the stating of the case and the appeal should be borne by the Commissioner of State Revenue." To supplement the answer to question (g), it also should be ordered that the costs of and incidental to the proceedings in the Queensland Court of Appeal be borne by the Commissioner. Kirby KIRBY J. This appeal26 raises an awkward point of contested statutory construction. Historically the point arises because of the superimposition of an amending law (namely the Managed Investments Act 1998 (Cth)) ("the federal law") having the consequence of altering the then Corporations Law of the State of Queensland in a way that had implications for the operation upon the parties of Queensland revenue legislation then in force, namely the Stamp Act 1894 (Q)27 ("the State Act"). Keeping this historical fact in mind provides the key to resolving the present controversy. The issues and purposive construction of revenue laws The ultimate issue in the appeal is whether an instrument of transfer of property to the appellant was chargeable with stamp duty in accordance with the State Act. The only basis propounded to sustain the submission of the appellant (Trust Company of Australia Ltd) that the instrument of transfer was not liable to the duty levied by the Commissioner (the respondent) was that, for the purposes of the State Act, the appellant was to be characterised as the "purchaser" of the property thereby conveyed to it. The facts are set out in other reasons. I will not repeat them. There may be "merits" arguments that support the appellant's submission. One could contend that the law at the relevant time should have so provided (as the judges of the Court below appeared to acknowledge28). The outcome urged by the respondent may appear somewhat unfair in that what was "in substance a single sale of property"29 is thereby subjected to ad valorem stamp duty twice by the decision under appeal. On the face of things, that might seem a surprising result for the operation of the State Act. But if it is one that the mind would naturally resist, the struggle can only continue to the extent that the terms of the legislation permit. 26 From a unanimous judgment of the Court of Appeal of the Supreme Court of Queensland: Trust Company of Australia Ltd v Commissioner of Stamp Duties (2001) 47 ATR 418 ("Trust Company"). 27 The legislation has since been repealed and replaced by the Duties Act 2001 (Q) but without affecting The Commissioner of Stamp Duties provided for in the repealed legislation has been replaced by a Commissioner of State Revenue from 1 March 2001. See Taxation Administration Act 2001 (Q), s 7(1). instruments earlier executed. its operation upon 28 See Trust Company (2001) 47 ATR 418 at 420 [2] per McMurdo P, 420 [5] per 29 Trust Company (2001) 47 ATR 418 at 420 [5] per Thomas JA. Kirby The Court below was aware of the element of discordancy in the result that it favoured. It felt unable to overturn the respondent's assessment. It concluded that the language of the State Act, applied to the facts of the case, was not susceptible to techniques of judicial re-interpretation designed to stretch the words to produce what might be considered a "just" outcome. I generally favour a purposive construction of legislation30. It is the approach that represents the contemporary doctrine of this Court31. Indeed, I go further and consider that it is emerging as a common mode of solving problems not only in words contained in written laws made by, or under the authority of, a legislature but also in disputed language in contracts and other legal instruments32. Revenue legislation is not in a category immune from the general principles of statutory interpretation33. The purposive approach applies to the ascertainment of the meaning of such legislation as to that of other written laws34. If the Queensland Parliament had considered in advance the consequences for stamp duty on instruments executed in relation to the transactions in question it might well have provided a clarification, or express exemption, to prevent the imposition of what effectively amounts to a form of double taxation upon what was in essence one inter-dependent transaction. In the end, that Parliament did act. However, it did so too late to assist the appellant. The other members of this Court have concluded, contrary to the opinion of the Court of Appeal, that the State Act may be interpreted in a way that avoids the apparent injustice of the exaction of a second amount of duty. If I could 30 Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 381-382 [69]-[71]; Boral Besser Masonry Ltd (now Boral Masonry Ltd) v Australian Competition and Consumer Commission (2003) 77 ALJR 623 at 686 [383]; 195 ALR 609 at 695. 31 Bropho v Western Australia (1990) 171 CLR 1 at 20 approving Kingston v Keprose Pty Ltd (1987) 11 NSWLR 404 at 421-424. 32 B & B Constructions (Aust) Pty Ltd v Brian A Cheeseman & Associates Pty Ltd (1994) 35 NSWLR 227 at 234-235. See also Kirby, "Towards a Grand Theory of Interpretation - The Case of Statutes and Contracts", (2003) 24 Statute Law Review 33 Deputy Commissioner of Taxation v Chant (1991) 24 NSWLR 352 at 356-357. 34 Steele v Deputy Commissioner of Taxation (1999) 197 CLR 459 at 477 [52]; Austin v Commonwealth (2003) 77 ALJR 491 at 514 [102], 542 [251]; 195 ALR 321 at 352, 390-391; cf Wilson v Commissioner of Stamp Duties (1988) 13 NSWLR 77 at 79-80. Kirby agree I would, because it is a happy outcome when legal analysis permits a result that accords with a decision-maker's opinion of what is just or fair in the merits sense. It would be naïve to deny that, in the process of statutory interpretation, judges, at every level of the hierarchy, are affected by their sense of justice in giving meaning to words. It may have been enough in 1872 to say that a court simply ascertains and declares "the real and true meaning of the instrument" sought to be brought to duty35. But today we know that the adjectives "real and true" add little to the process of interpretation. Contemporary theories of legal construction – indeed of decision-making more generally – are alive to the much more complex process of reasoning that is ordinarily involved. Presuppositions, unconscious inclinations and other like mysteries doubtless affect a judge's ultimate decision. I will not delve into any of these. It will be enough for me to state briefly the legal considerations on the basis of which I differ from the majority in this Court. I would uphold the decision of the Court of Appeal and dismiss the appeal. The instrument was correctly brought to tax Statutory context and legislative intention: The duty of a court, where the law has been reduced to written form (whether in an act of Parliament or a law made with the authority of the same) must be, and only be, to uphold the law so made36. A court's duty is not to the principles of the common law that preceded the legislative form nor to early, or other, or foreign statutes. Obedience to the text of legislative provisions is founded on a critical postulate of democratic governance In our Commonwealth it is the first duty of the courts to give effect to a valid legislative purpose where it is expressed in law. The primacy of that obligation derives from the special legitimacy of the written law that may, in turn, be traced to the imputed endorsement of such a law by legislators elected by the people. This means that courts must give effect to the purpose of the lawmaker, ascertained by reference to the language in which that purpose is expressed. the Australian Constitution. inherent that 35 Limmer Asphalte Paving Co v Commissioners of Inland Revenue (1872) 7 Ex 211 at 214. See reasons of Gummow and Hayne JJ at [32]. 36 Regie National des Usines Renault SA v Zhang (2002) 76 ALJR 551 at 579 [146]- [147]; 187 ALR 1 at 40. Kirby Courts may sometimes perceive, and feel able to overcome, injustices, mistakes and omissions in the written law37. But if the text is relevantly clear, and applicable to the case in hand, no court may substitute its own view of what the law should be (or perhaps would have been if only Parliament had considered the case and foreseen the instance that arose to present a difficulty). The critical term in the State Act in question in this appeal is "purchaser". It is the key word in s 54(6) of that Act. It is true that such a word, like any other, takes its colour and meaning from its context. In a case such as the present, the process of characterisation must necessarily take account of the circumstances of the transaction and the terms of the contract, in order to identify the character and role of each of the parties to that transaction. It must also have regard to the legislative context in order to ascertain the meaning of the term "the purchaser" in the applicable statutory provision. That legislative context undoubtedly includes the succeeding sub-section of the State Act. That sub- section, s 54(6A), reads: (6A) Subsection (6) does not apply in respect of a conveyance or transfer made to a person other than the person named as purchaser in the contract or agreement for sale to which the conveyance or transfer is intended to be pursuant unless the commissioner is satisfied that at the time the contract or agreement for sale was executed the person named therein as purchaser was acting in the transaction evidenced by such contract or agreement as agent for the person to whom the conveyance or transfer is made … and was so acting under authority given to him or her by such person in writing executed prior to the execution of the contract or agreement for sale." (emphasis added) It is a serious error of interpretation to approach the meaning of "purchaser" in s 54(6) of the State Act without paying regard to the elaboration of that sub-section introduced by s 54(6A). The need to interpret the two sub- sections together is signalled by the opening words of s 54(6A) and by the highly specific language in which the qualification thereby introduced is stated. The Queensland Parliament has addressed the identification of the "purchaser" for the purposes of s 54(6) of the State Act in very precise language. Presumably it has done so to overcome the risk of schemes of tax avoidance whereby a person might claim that someone else, and not it, was the "purchaser" and thus liable to duty. To avoid such disputes, strict preconditions to the application of s 54(6) 37 cf Tokyo Mart Pty Ltd v Campbell (1988) 15 NSWLR 275 at 283; Bermingham v Corrective Services Commission of NSW (1988) 15 NSWLR 292 at 302. Kirby are laid down, since that provision affords a mechanism for exemption from duty that would otherwise be levied. Relevantly, the "purchaser" must be "named as [such] in the contract or agreement for sale" unless the Commissioner reaches a satisfaction (not available in the present case) that the person named as "purchaser" was acting as an agent under authority. The high particularity of the conditions for receiving the benefits of the effective exemption from duty in s 54(6) speak strongly against the construction urged by the appellant. If the Queensland Parliament took the trouble to address, in such a specific way, the prerequisites to the application of the exemption, it is no part of the function of this Court to brush those preconditions aside and to read s 54(6) as if s 54(6A) did not exist. A statutory text must be read as a whole. Words or sub-sections should not be read in isolation38. The only proper way to ascertain the relevant purpose of Parliament is to read the entire Act, or at least the Chapter or Part in question, and certainly the whole section of the provision in dispute. With respect, s 54(6A) does not say that s 54(6) may apply where the Commissioner is satisfied of various matters although the instrument is a conveyance or transfer made to a person other than the person named as purchaser in the contract or agreement for sale to which the conveyance or transfer is intended to be pursuant. On the contrary, by its terms, s 54(6A) clearly states that "[s]ubsection (6) does not apply" in the particular circumstances. The first logical step in considering a suggested invocation of s 54(6) of the State Act in the particular case is therefore to ask the question: "First, does s 54(6) apply at all?" In the present case, the transfer pursuant to the contract for sale was to a person "other than the person named as purchaser in the contract", namely the appellant. The appellant was identified in the contract as the "custodian". Further, as the Court of Appeal recognised, the person identified as the "purchaser" in the contract for sale (Cromwell Property Securities Ltd) could not be characterised as the appellant's agent. Therefore, the relief against the payment of duty on the instrument of transfer pursuant to s 54(6) (as expanded by s 54(6A)) was not available to the appellant. Within the four walls of the applicable section, this tells against the construction urged by the appellant. Self-description and identifying the purchaser: It is true that the word "purchaser" is not expressly defined either in the State Act or the instrument in question in this case and, as a general proposition, is susceptible to various 38 CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408; Boral Besser Masonry Ltd (now Boral Masonry Ltd) v Australian Competition and Consumer Commission (2003) 77 ALJR 623 at 686-687 [385]-[386]; 195 ALR 609 Kirby meanings depending on the context39. However, the position of the appellant can only be described as the "purchaser" in the present case by doing a measure of violence to that concept as it is ordinarily understood in the English language. This Court should not undertake such a course simply to avoid what may seem to be an instance of "double taxation"40. The appellant was not the "purchaser" within the ordinary meaning of that word. As contemplated by s 54(1) of the State Act, a "purchaser", under a relevant contract, was the person bearing the contractual obligations ordinarily borne by a purchaser. Principally, these obligations include the purchaser's contractual obligation to pay the purchase price. No such obligation was assumed by the appellant. To be a "purchaser" a person must normally assume a purchaser's obligations as well as enjoy its rights41. In the cases, a distinction is commonly drawn between a person entitled to take a conveyance, on the one hand, and a "purchaser" on the other42. According to such authority, the appellant is not readily characterised as the "purchaser" of the subject property. As the respondent submitted before this Court, any obligations undertaken by the appellant under the contract for sale were minimal. This is an unsurprising conclusion given that, in the contract for sale, another party (Cromwell) is specifically named as the "purchaser". As the text of that instrument, set out with added emphasis in the reasons of Callinan J43 shows, there was a perfectly good "purchaser" in these transactions. That was Cromwell. For this Court now to say, contrary to the terms of the instruments and notwithstanding the nomenclature used by the parties to describe the way they saw themselves, that there were in fact two "purchasers", namely the appellant as well as Cromwell, is unconvincing. Self-description cannot compel a particular decision under the State Act concerning the character of a party propounded as a "purchaser". But whilst the descriptions adopted by the parties are not determinative of the effect of the 39 cf Commissioner of Stamp Duties (NSW) v Pendal Nominees Pty Ltd (1989) 167 CLR 1 at 16-17. 40 cf reasons of Gummow and Hayne JJ at [55]; reasons of Callinan J at [121] with reference to Executor Trustee & Agency Co of South Australia Ltd v Federal Commissioner of Taxation (1932) 48 CLR 26 at 44. 41 Dudley Buildings Pty Ltd v Rose (1933) 49 CLR 84 at 97. 42 eg Vickery v Woods (1952) 85 CLR 336 at 343-344; Commissioner of Stamp Duties (NSW) v Pendal Nominees Pty Ltd (1989) 167 CLR 1 at 16, 21-22, 32. 43 See reasons of Callinan J at [98]-[104]. Kirby statutory provisions on the relevant instruments, in the present instance, as the Court of Appeal correctly recognised, the identification of the parties accords with the roles they respectively performed as understood after reading the applicable statutory provisions. It is therefore unsurprising that the Court of Appeal should have taken the instrument and the requisite character of the appellant at face value. Its opinion that the appellant was not the "purchaser" for the purposes of s 54(6) of the State Act is unremarkable. Without more, I would reach the same conclusion. The supervening federal law: This conclusion is strongly reinforced when it is remembered that the true character of the appellant for the purposes of the scheme and the instant transaction was that introduced into the Corporations Law following the passage of the federal law. It introduced a capacity quite distinct from that of a "purchaser" under the State Act. Indeed, the distinct capacity was superimposed by law upon the private intentions of the parties (if any) as evidenced in their written instruments. Put shortly, the appellant was appointed as a "custodian", as contemplated by the legislative scheme instituted by the Corporations Law44. That arrangement operated throughout Australia for the purposes of regulating a "managed investment scheme". Pursuant to the legislative scheme, initiated by the federal law for the protection of the investing public in Australia, and given effect by the amendments to the Corporations Law, the appellant had a special statutory function. Whilst, in some cases, it might be possible for such a person to be a "purchaser" under the State Act, or under a private instrument, in my view, that was not the scheme contemplated by the law applicable to this case. Under that law, the status assigned to the appellant was that of a special kind of statutory "trustee". The appellant was thus interposed between the "vendor" and the "purchaser" (namely, Riverfront Developments Pty Ltd and Cromwell). As contemplated by the legislative scheme (and consistent with the identification of the parties in the contract for sale), the appellant was neither the "vendor" nor the "purchaser". The duties and functions required of the appellant by the Corporations Law deny either appellation to it. Specifically, they deny that the appellant was, or could be, a "purchaser" for the purposes of s 54(6) of the State Act. The federal law and consequent amendment to the Corporations Law are each expressed in terms of "trustee" and "beneficiary"45. 44 See now the Corporations Act 2001 (Cth), s 601EA(2)(a). 45 See eg Corporations Law s 601ED(4)(b). Kirby To the complaint that this construction is unduly narrow and condones a form of double taxation, the answer is that it is the meaning clearly expressed by the law enacted by the Queensland Parliament. There are two aspects to the legislative purpose evidenced in s 54(6) of the State Act, as read in its statutory context, and the distinction there drawn between a purchaser and a transferee. On the one hand, the provision aims to ensure that any instrument of transfer of real property pursuant to a contract for sale is dutiable if the transfer is to someone other than the purchaser. As a corollary, the purchaser is relieved from paying double duty where duty has been paid on the contract for sale. Therefore, Parliament considered that in some instances the transferee of property would not be the same as the purchaser. Such an arrangement can be effected for a variety of reasons, sometimes commercial, or sometimes in order to comply with statutory conditions similar to those imposed on Cromwell as the responsible entity of the managed investment scheme in the present instance. Had Cromwell purchased the property first, and then sought to put in place the arrangement with the appellant as a custodian in order to comply with its licence, duty would have been payable on both steps of that transaction. When Parliament enacted s 54(6) of the State Act, it had no reason to anticipate, or provide for, the eventuality that supervened with the passage of the federal and State laws requiring the interposition between the vendor and purchaser of a party having the "custodial" or "trustee" functions of the appellant. The Queensland Parliament can therefore scarcely be blamed for not having anticipated, and provided for, such a statutory development. Taxation and serial property transactions: The supposed presumption against a construction of revenue laws that results in "double taxation"46 does not, in my view, represent the present approach of this Court to the interpretation of ambiguous taxing legislation. Old approaches of this kind, favouring the taxpayer, are less persuasive today given the democratic legitimacy of the legislature to enact revenue laws as it chooses, the larger needs of modern government served by taxation and the proliferation of sophisticated schemes for tax avoidance47. However that may be, I agree with Gummow and Hayne JJ48 that 46 Executor Trustee & Agency Co of South Australia Ltd v Federal Commissioner of Taxation (1932) 48 CLR 26 at 44. See reasons of Callinan J at [121]. 47 Federal Commissioner of Taxation v Westraders Pty Ltd (1980) 144 CLR 55 at 79- 80 per Murphy J (diss); Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation (1981) 147 CLR 297 at 319-323; Austin v Commonwealth (2003) 77 ALJR 491 at 514 [102], 542 [251]; 195 ALR 321 at 352, 390-391; cf Hill, "Á Judicial Perspective on Tax Law Reform", (1998) 72 Australian Law Journal 685 at 688-690. 48 Reasons of Gummow and Hayne JJ at [55]. Kirby any such presumption as stated by Dixon J in Executor Trustee & Agency Co of South Australia Ltd v Federal Commissioner of Taxation49, is not available in this case. Dixon J was there dealing with income taxation. Different considerations arise in cases of stamp duty. As illustrated by the present case, the impost of the latter form of taxation may fall upon the business dealings of propertied interests. In such cases it cannot necessarily always be assumed that Parliament intended to avoid double taxation. It remains, in each instance, to ascertain the meaning of the statutory provision from its language. In this area of the law, duty is typically levied upon the instruments executed by the parties and not upon their substantive dealings or transactions50. Like other statutes of this kind, the State Act levies duty on instruments, rather than on transactions (with some specific amelioration provided in s 54(6), as elaborated and expanded by s 54(6A)). In a particular case, by focusing on the instruments, this approach may occasionally produce an outcome that may seem to impose an unfair result given the "real" or "practical" effect of composite transactions or inter-related dealings between the parties. However, as this is the way such revenue laws are typically expressed (and as the State Act is expressed here), it is beside the point to emphasise the nature of the transactions or dealings if the analysis of the instruments in question results in a different conclusion, as it does here. There is no reason why the present State Act should be assumed to depart from the foregoing basic principle. It is a principle that applies the purposive rule of construction to legislation that imposes taxation. As Rowlatt J noted in Cape Brandy Syndicate v Inland Revenue Commissioners51: "[I]n a taxing Act one has to look merely at what is clearly said … There is no equity about a tax. There is no presumption as to a tax … One can only look fairly at the language used." A hard case affords no occasion to depart from such time-honoured legal concepts. Subsequent legislative repair: A further consideration should be mentioned. Following the execution of the instrument brought to duty in this 49 (1932) 48 CLR 26 at 44. 50 cf DKLR Holding Co (No 2) Pty Ltd v Commissioner of Stamp Duties (NSW) (1982) 149 CLR 431 at 449; Commissioner of State Revenue v Pioneer Concrete (Vic) Pty Ltd (2002) 76 ALJR 1534 at 1540 [34]; 192 ALR 56 at 64. 51 [1921] 1 KB 64 at 71 (emphasis added). Kirby case, the Queensland Parliament enacted the Revenue Laws Amendment Act 2000 (Q)52. By that Act53, exemptions were enacted that would have the effect, after 2000, of exempting a "custodian" (such as the appellant) from liability for duty on a transfer such as the one brought to duty in this case. Citing authority54, the respondent pointed to this amendment, to the explanatory notes distributed with the Bill that became the Act of 2000 (explaining the need for the amendment) and to the fact that the construction urged by the appellant would, in effect, leave such amendment with no work to do55. It would hold that Parliament had made a mistake and enacted an alteration to the State Act that was never necessary. I accept56, and have been party to57, decisions in which this Court has thrown cold water on the assumptions, inherent in the old approach, that legislatures pay vigilant attention to the decisions of courts concerning legislative meaning, that they always act in a consistent way and that they never make a mistake in the understanding of the written or unwritten law. Such assumptions are, as Dixon J remarked of one of them in R v Reynhoudt58, "quite artificial". Nevertheless, without embracing the view that the supervening legislative amendment is conclusive as to the meaning of s 54(6) of the State Act at the relevant time (as the respondent's argument seemed to suggest) I agree with what Dawson J said in Taikato v The Queen59: 54 eg Grain Elevators Board (Vict) v Dunmunkle Corporation (1946) 73 CLR 70 at 55 This is a relevant consideration: Commissioner of State Revenue v Pioneer Concrete (Vic) Pty Ltd (2002) 76 ALJR 1534 at 1544 [52]; 192 ALR 56 at 69. 56 eg Flaherty v Girgis (1987) 162 CLR 574 at 594; Hepples v Federal Commissioner of Taxation (1992) 173 CLR 492 at 539. 57 eg Zickar v MGH Plastic Industries Pty Ltd (1996) 187 CLR 310 at 351. See also 58 (1962) 107 CLR 381 at 388: noted in Zickar v MGH Plastic Industries Pty Ltd (1996) 187 CLR 310 at 329. 59 (1996) 186 CLR 454 at 471-472 (footnote omitted). See also the point reserved by Callinan J in Commissioner of State Revenue v Pioneer Concrete (Vic) Pty Ltd (2002) 76 ALJR 1534 at 1544 [54]; 192 ALR 56 at 69. Kirby "Whilst it is not possible to take the amendments to [the legislation] into account in interpreting the section as it was before the amendments, at least upon the view which I take which is that the prior legislation is unambiguous, the kind of circumstances which are relevant in determining whether the appellant [could invoke] the unamended section." those amendments serve indicate In effect, the amendments enacted by the Queensland Parliament in 2000 acknowledged that an adjustment to the State Act was needed to remove a potential source of unfairness and prospects of double taxation. This was, in substance, the response of the Queensland Parliament to the alteration in the Corporations Law in consequence of the supervening federal law, whose impact had, by inference, not been foreseen or appreciated at the relevant time. It is possible (as Callinan J considers) that, in enacting its amending statute in 2000, to correct the position for future cases like the appellant's case, the Queensland Parliament was making a mistake. I would certainly not go so far as to say that it was necessarily confirming the application of the previous law or decisions of courts (if any) and decisions of the respondent as to the view of the State Act that is under scrutiny in this appeal. However, the alternative interpretation of the amendment is that an unintended legislative disharmony arising from laws originating from different Australian law-makers was eventually noted and corrected where it should be – by the legislature, and not by a court. Respecting limited parliamentary reform: Much has recently been made of the duty of courts, including this Court, to give effect to legislation and to leave amendment to the proper place in Parliament. Where, as here, the relevant Parliament has acted with due speed, this Court should hesitate long to come to the view that it enacted a futility. Unfortunately for the appellant, the amending Act of 2000 was not expressed to have retrospective operation so as to apply to the appellant's case. That omission itself seems to affirm the purpose of the Queensland Parliament that, for cases such as that of the appellant, falling in the interval between the passage of the amendment to the Corporations Law (following the enactment of the federal law) and the passage of the amendment to the State Act, the successive instruments would be brought to tax according to their respective terms and in accordance with the State Act as it stood at that time. Were it otherwise, it would have been easy to provide that the amendment should have had a retrospective application. But that was not done. Kirby Conclusion and orders The result is that, in my view, the Court of Appeal was correct in the conclusion that it reached about the meaning of the State Act as derived from the language in which that Act was then expressed. The respondent was correct to assess the Form 1 transfer, in issue in the case, as an instrument within the State Act60. He was right to conclude that such instrument was liable to duty as the Act then stood. The exemptions provided for in the State Act had no application. The specifically worded concession did not apply. The subsequent statutory reform gave no relief. The Court of Appeal was right to uphold the respondent's decision. When future problems of statutory interpretation are presented to this and other courts the outcome in the present appeal may be cited to emphasise the scope of judicial choice in discharging the interpretive function. Choice in such matters is inescapable, as the division of judicial opinion about the meaning of the legislation in this case shows. But the selection of the preferred choice, that is ultimately made by a court, is more transparent if the relevant considerations of legal history, principle and policy are identified. Rarely is the choice to be elucidated solely from the language of the statutory text. What is "over- simplified", or "narrow" and "inflexible" to one judge is simply fidelity to the proper understanding of the legislation for another61. The appeal should be dismissed with costs. The answers given to the Case Stated by the Court of Appeal of the Supreme Court of Queensland were correct and should be confirmed. 60 s 49(1)(a). 61 cf reasons of Gleeson CJ at [15], [18]. Callinan CALLINAN J. Cromwell Property Securities Limited ("Cromwell") was granted a dealer's licence under s 784 of the Corporations Law on 1 September 1997. The licence authorized Cromwell to operate managed investment schemes relating to real property and to carry on a securities business as the responsible "entity" of those schemes. It was a relevant condition of the licence that Cromwell not hold scheme property in its own name but appoint a custodian to do so. Managed investment schemes are subject to the provisions of Ch 5C of the Corporations Law (ss 601EA to 601QB), which commenced on 1 July 1998. Under s 601FB(2) of that Law the responsible "entity" of a registered scheme has the power to appoint an agent, or otherwise engage a person, to do anything that it is authorized to do in connexion with the scheme. One purpose of the sub-section is to permit the appointment of a custodian62. A custodianship agreement between Trust Company of Australia Limited (the appellant) and Cromwell (as manager) was executed on 4 October 1999. The agreement contained these recitals: "A. The Manager proposes to be the responsible entity of Riverfront on Coronation Planned Investment (the Scheme). The Manager has the power and authority to appoint an agent to hold assets in relation to the Scheme. The Custodian has indicated to the Manager that it is willing to act as custodian of the Scheme on the terms and conditions set out in this Agreement. In its capacity as trustee and responsible entity of the Scheme and in that capacity only, the Manager wishes to appoint the Custodian as custodian of the Scheme. The Custodian has agreed to accept that appointment on the terms and conditions set out in this Agreement." Clauses 4(1) and 4(2) of the agreement contemplated that the appellant would act and stand in all respects as the purchaser and legal owner of the scheme property: "4.1 Scope of appointment Having regard to the nature of the Scheme, it is intended that the Custodian's duties will be as follows:- 62 Robson's Annotated Corporations Law, 6th ed (2001) at 806. Callinan to enter into a contract to purchase the Scheme Property (and contracts to purchase any other land which is to become an Asset); to hold the Scheme Property (and any other land or other Assets of the Scheme) on the Manager's behalf; to open and maintain Bank Accounts to hold: application money; and rent and other income of the Scheme; to enter into Leases of Land of the Scheme on the Manager's behalf; to do such other things as are agreed in writing between the Manager and the Custodian from time to time; the Manager agrees that the Custodian or any Sub-custodian may hold any property including any Assets on a pooled basis or in an omnibus account in accordance with any class order issued by ASIC or any specific relief from the requirements of section 601FC(I)(i) of the Corporations Law granted by ASIC in relation to the Scheme; the Custodian may appoint or engage at the Manager's expense accountants, auditors, barristers, solicitors, advisers, consultants, brokers, counter parties, couriers or other persons (not being persons appointed under clause 5) where it considers their appointment or engagement necessary or desirable for the purpose of exercising its powers or performing its duties under this Agreement. The Custodian is not liable for any loss, damage or expense suffered or incurred as a result of any act or omission whatever, including a negligent act or omission, of a person appointed or engaged under this clause 4.1(g); the Custodian may in the ordinary course of business, without reference to the Manager, effect transactions in which the Custodian has directly or indirectly a material interest, or a relationship of any kind with another person, which may involve a potential conflict of the Custodian's duty to the Manager, and the Custodian is not liable to account to the Manager for any profit, commission or those remuneration made or received in relation Callinan transactions or any connected transactions. A reference in this clause to the Custodian includes a Sub-custodian; the Custodian is authorised to comply with any obligation imposed on it by law; the Custodian may do any other things which it considers necessary, desirable, incidental to or in furtherance of the matters referred to in this clause; subject to this Agreement, the Custodian has absolute discretion as to the exercise of all powers, authorities and discretions vested in it under this Agreement; the services of the Custodian under this Agreement are not exclusive. The Custodian is free to provide similar service to others, and is not obliged to disclose to the Manager anything which comes to its notice in the course of providing services to others or otherwise than in the performance of this Agreement; the Custodian is not obliged to see whether, in exercising any of its powers or performing any of its duties under this agreement in accordance with Proper Instructions, the person issuing the Proper Instructions is acting in proper exercise or performance of his powers or duties; and the Custodian is not responsible for checking or ascertaining the value of any property or whether the price to be paid for any property is proper or reasonable or whether any transaction which it is instructed to effect accords with the prospectus, constitution, information memorandum, investment policy or limit for the time being established for or in force in relation to the Scheme. requirements, compliance 4.2 Holding property The Custodian must hold Assets as follows: In the case of Land, unless the Manager agrees otherwise, in its own name. To the extent permitted by the relevant Governmental Agency the Custodian must ensure that all Certificates of Title record that the Land in question is held by the Custodian on the Manager's behalf." (emphasis added) Callinan Other relevant clauses were as follows: "10. LIABILITY AND INDEMNITY 10.1 Standard of care The Custodian agrees to exercise and to procure that its agents and Subcustodians exercise all due care and diligence in carrying out the provisions of this Agreement. The Custodian will not be liable to the Manager for any action taken or omitted to be taken by it or any Subcustodian or other agent where the Custodian or the Subcustodian or agent acted in good faith and without negligence, but will be liable for any action taken or omitted to be taken by it or any Subcustodian or other agent in breach of the standard of care specified in this clause. 10.2 Specific instructions Subject to the Custodian meeting the requisite standard of care specified in clause 10.1, the Custodian will not be liable to the Manager for any damage, loss or expense resulting from or caused errors by the Manager or the Property Manager in their Proper Instructions to the Custodian; acts, omissions or insolvency of a Securities System; or complying with a Proper Instruction. 10.3 Responsibility for loss If the Manager suffers any loss: arising from the Custodian's, its Subcustodian's or other agent's performance of, or failure to perform, its obligations under this Agreement; and for which the Custodian is liable under this Agreement. The Custodian shall indemnify the Manager for the direct loss suffered by it, but shall not indemnify the Manager against any consequential or special damages, economic loss or loss arising from any special circumstances of the Manager. 10.4 Disputes or conflicting claims Callinan If any dispute or conflicting claim is made by any person or persons with respect to any asset in an Account, the Custodian shall be entitled to refuse to act in respect of that asset until either: such dispute or conflicting claim has been finally determined by a court of competent jurisdiction or settled by agreement between conflicting parties, and the Custodian has received written evidence satisfactory to it of such determination or agreement; or The Custodian has received an indemnity, reasonably satisfactory to it, to hold it harmless from and against any and all loss, liability and expense which the Custodian may incur as a result of its actions. 10.5 The Custodian not responsible for title The Custodian shall not be responsible for the title, validity or genuineness, including good deliverable form, of any Asset or evidence of title to an Asset. 10.6 Indemnity The Manager agrees to indemnify the Custodian for any action taken or omitted to be taken by it and from all claims, expenses, demands, damages, losses and liabilities relating to Assets and the holding of Assets where the Custodian acts in good faith and without negligence, but the Manager will not indemnify the Custodian for any action taken or omitted to be taken by the Custodian in breach of the standard of care specified in this clause." On 29 November 1999, notwithstanding the clear words of cl 4(1) of the custodianship agreement which imposed upon the appellant the duty of entering into the contract as purchaser, Cromwell (naming itself as purchaser) and the appellant entered into a contract for the purchase of land and improvements in Brisbane for the sum of $17,500,000 (subject to some non-relevant adjustments). The contract was generally in accordance with a form approved by the Queensland Law Society Incorporated. Some changes and additions were however made to it. The parties to the contract and others involved in its preparation and completion were described as follows: Custodian: Vendor: Vendor's solicitors: Purchaser: Trust Company of Australia Limited Riverfront Developments Pty Ltd Cromwell Property Securities Limited Callinan Purchaser's solicitors: Stakeholder: Creagh Weightman Lawyers Creagh Weightman Lawyers In a number of instances the appellant and Cromwell were treated by the drafter of the contract interchangeably as purchaser by the insertion of the words "or custodian" after the word "purchaser" in the contract but not invariably so. Clause 4(b) of the standard form was amended to read as follows: "The balance of the Purchase Price shall be paid on the Date for Completion in exchange for: A properly executed transfer of the Land from the Vendor to the Custodian capable of immediate registration (after stamping) in the appropriate office free from Encumbrances (other than those set out in Item L) and title to the Property (other than the Land) free from Encumbrances (other than those set out in Item L) but subject to the conditions of this Contract." (emphasis added) New cll 5(1)(c) and 5(1)(d) were inserted so that cl 5 in its entirety read as follows: "5 KEYS Immediately on completion, the Vendor shall deliver all Keys, which are in the possession or under the control of the Vendor, in accordance with any notice given in writing by the Purchaser to the Vendor and failing such notice the Vendor shall deliver the Keys: to the Purchaser, if the Purchaser is present personally at completion; to the Purchaser's solicitor at completion, if the Purchaser is not present personally; to the Custodian, if the Custodian is present personally at Completion; to the Custodian's solicitor at Completion if the Custodian is not present personally at Completion; to the Vendor's Agent at the address shown in Item B, if neither the Purchaser nor any solicitor acting for the Purchaser is present personally at completion; Callinan to and left at the Property if none of the provisions of clauses 5.1(a), 5.1(b), 5.1(c), 5.1(d) or 5.1(e) are applicable." (emphasis added) As a result of further amendments cll 6, 10, 21.2, 24 and 27.4 became as follows: INVESTMENT OF DEPOSIT If either the Vendor or the Purchaser directs by notice in writing to the Stakeholder to invest the Deposit then (where the Stakeholder is lawfully able) the Stakeholder shall invest the Deposit with any Financial Institution permitted by law for the investment of trust money until the Date for Completion. If this Contract is completed, all interest accruing on the investment of the Deposit shall be shared equally between the Vendor and the Purchaser. If this Contract is not completed for any reason, the interest accruing on the Deposit shall be paid to the party entitled to the Deposit upon termination of this Contract. The Deposit and any accrued interest shall be invested at the risk of the party to whom the Deposit and accrued interest is ultimately payable and the Stakeholder shall not be liable for any loss suffered by the Vendor or the Purchaser in consequence of an investment pursuant to clause 6.1. To facilitate investment of the Deposit, the Vendor and the Purchaser shall notify its tax file number to the Stakeholder within 4 Business Days following the date of this Contract. The Vendor and the Purchaser authorise the Stakeholder to prepare and lodge any taxation return necessary in respect of the Deposit and interest and to pay any tax assessed out of the Deposit and interest and indemnify the Stakeholder against any taxation assessed in respect of such interest. The Vendor and the Purchaser shall be deemed to be presently entitled in equal shares to any interest accrued for the purposes of the Income Tax Assessment Act 1936. EXECUTION AND PRODUCTION OF DOCUMENTS 10.1 Subject to compliance by the Purchaser with the Purchaser's obligations under or by virtue of this Contract the Vendor shall as Callinan required do all acts and execute all documents necessary for the purpose of completing the sale and ensuring that the Custodian obtains a good and valid title to the Property but all transfer documents, any declaration required pursuant to clause 4(c), and all instruments or declarations required pursuant to clause 4(d) shall be prepared by and at the expense of the Purchaser and delivered to the Vendor within a reasonable time prior to the Date for Completion. If so requested by the Purchaser or the Custodian, the Vendor shall deliver to the Purchaser or the Custodian, prior to the Date for Completion, photocopies of the documents executed by the Vendor. 10.3 After execution of the transfer, if so requested by the Purchaser or the Custodian and upon payment of the usual production fee by the Purchaser, the Vendor shall cause the transfer to be tendered to the Office of State Revenue for stamping, together with any declaration referred to in clause 4(c) and thereupon the Vendor shall be deemed to have complied with the Vendor's obligations under clause 4(c). If an instrument of title is required to register a transfer of the Land and the instrument of title relating to the Land also relates to other land, the Vendor shall not be obliged to deliver it to the Purchaser or the Custodian but shall enter into such reasonable covenants with the Purchaser or the Custodian as the Purchaser or the Custodian may require for production of the instrument of title. If the instrument of title is partially cancelled the Vendor shall not be obliged to produce a separate instrument of title on completion. 10.6 Where either clause 10.4 or clause 10.5 apply, the Purchaser shall bear the cost of any new instrument of title relating to the Land. 21.2 The Vendor authorises the Purchaser or the Custodian or the Purchaser's or the Custodian's solicitor to inspect all records relating to the Property held by the Local Government or other body maintaining any such records and will if requested by the Purchaser or the Custodian sign an appropriate authority to the Local Government or other body for the purposes of this clause 21. Callinan 24 MERGER Despite completion and despite the registration of the transfer in favour of the Custodian, any general or special condition (or any part or parts thereof) to which effect is not given by completion or registration and which is capable of taking effect after completion or registration shall remain in full force and effect. 27.4 For the purposes of this clause 27, a party's address for notices shall in the case of the Vendor be the address specified in Item C and in the case of the Purchaser shall be the address specified in Item E and in the case of the Custodian, shall be at the following address: BRISBANE QLD 4000." (emphasis added) Settlement of the purchase was effected on 20 November 1999 by the exchange of the balance of the price for the title deed to the land, and an executed transfer of it in favour of the appellant in Form 1 version 3 of the Schedule to the Land Title Act 1994 (Q) dated 29 November 1999. It is in par 5 of that document, beside the word "transferee" that the appellant's name appears. The vendor, Cromwell and the appellant also brought into existence a document designated as Form 24 setting out an apportionment of the price as between real property and personal property. There, after the words "Details of Transferee/Purchaser" the name of the appellant appears. The appellant's solicitors submitted the contract and the transfer to the Commissioner of State Revenue (the respondent) for stamping with a letter of 3 December 1999 which purported to explain the transaction in this way: "The enclosed Contract and transfer deal with the transfer of land described on the transfer to a syndicate of investors known as Riverfront on Coronation Planned Investment Scheme. Cromwell Property Securities Limited is the responsible entity and trustee of the Scheme and is the proper party to be nominated as the Purchaser in the Contract of Sale. Pursuant to a Custody Agreement dated 4 October 1999 between Cromwell Property Securities Limited and Trust Company of Australia Limited, Trust Company of Australia Limited is appointed as Custodian of Callinan the Scheme. The appointment of a Custodian is a requirement of the Managed Investments Act amendments to the Corporations Law which require separation of legal and equitable title in Managed Investment Schemes. The role of Trust Company of Australia Limited is limited to holder of the legal title pursuant to the Custodian Agreement. We refer you to the following clauses of the Custody Agreement which sets out the following duties: 4.1(a) – entering into a contract to purchase the Scheme property; 4.1(b) – holding the Scheme property on the Manager's behalf." The respondent on the same date replied as follows: "I refer to your letter of 3 December 1999 and note that you act for a party in relation to this matter. Although I am not yet in a position to issue an assessment of duty, I am prepared to release the transfer to you as requested upon payment of the sum of $653,475 on account of the duty to be assessed together with your undertaking to satisfy any further requisitions and to pay any further duties assessed in addition to $653,475. This offer has been extended to you on the understanding that the matter is of the utmost urgency and should not be taken as a precedent for any future transactions. This matter will receive prompt attention, and you will be advised of the outcome in the near future." On 29 November 1999 the respondent issued a nil assessment on the transfer. On the same date however it issued a further assessment as follows: "My assessment of stamp duty for the documents lodged is as follows: Doc Date of Document 1 29 NOV 1999 Document Description Consideration/Value Duty Duty Category CONV/TRANSFER – OTHER CONTRACT OF SALE Parties 2 29 NOV 1999 Document Description Parties Callinan CROMWELL SECURITIES PTY LTD PROPERTY RIVERFRONT DEVELOPMENTS PTY LTD CONV/TRANSFER – OTHER TRANSFER PROPERTY REAL TRUSTEE COMPANY OF AUSTRALIA LTD CROMWELL SECURITIES PTY LTD PROPERTY RIVERFRONT DEVELOPMENTS PTY LTD 3 04 OCT 1999 NO DUTY PAYABLE Document Description Parties AGREEMENT TRUSTEE COMPANY OF AUSTRALIA LTD CROMWELL SECURITIES PTY LTD PROPERTY Assessment Total Less Amount Paid Amount Due The appellant objected to the assessment on several grounds as follows: The assessment is an amended assessment. Callinan By assessment notice dated 6 January 2000 the Commissioner assessed duty on the Transfer and, after allowing a rebate pursuant to subsection 54(6) of the Act in relation to duty paid on the contract of sale, determined that no amount of duty was exigible on the Transfer. The Commissioner did not ascertain any facts after the date of the making of the assessment of 6 January 2000 which established that the duty as so assessed was assessed at an insufficient amount. In the premises the assessment is ultra vires and void. The Transfer was executed and delivered to the transferee in completion of a certain contract dated 29 November 1999. The contract was duly stamped and duty was paid thereon in accordance with section 54 of the Act. In the premises a rebate of duty was allowed to the Objectors pursuant to subsection 54(6) of the Act such that no duty was chargeable on the Transfer." In disallowing the objection the respondent wrote this: "The Contract was assessed under Section 54(1) of the Stamp Act 1894 ("the Act") and the duty was calculated at the rates set out in paragraph 4(a) of the Conveyance or Transfer head of charge in Schedule 1 of the Act.63 63 "(4) Of any property (except stock or marketable security or right in respect of shares) - upon a sale for a consideration in money or money's worth of not less than the full unencumbered value of the property - Duty calculated on the amount or value of the consideration at the following rate - Not exceeding $20 000 - $1.50 duty for every $100 and also for any fractional part of $100 of the value of the consideration. Exceeding $20 000 but not exceeding $50 000 - $300 duty plus $2.25 for every $100 and also for any fractional part of $100 of the value of the consideration in excess of $20 000. (Footnote continues on next page) Callinan The Transfer was assessed under Section 49(1) of the Act and the duty was calculated at the rates set out in paragraph 4(a) of the Conveyance or Transfer head of charge in Schedule 1 of the Act." The correctness of the respondent's disallowance of the appellant's objection was put in issue in a case stated for the determination of the Court of Appeal of Queensland (McMurdo P, Thomas JA and Helman J) which unanimously found for the respondent. Helman J, who wrote the leading judgment, was of the opinion that the appellant was not a, or the purchaser, within the meaning of s 54(6) of the Stamp Act 1894 (Q), (the "Act")64 and accordingly was not entitled to a rebate of stamp duty to the extent stamp duty had been levied and paid on the contract. His Honour stated his conclusion in this paragraph65: "While the purchaser under a contract of sale of land will generally be the transferee of the land it does not follow that the transferee is always the purchaser. A purchaser has the right at common law to nominate a transferee to take title instead of the purchaser, unless of course the vendor Exceeding $50 000 but not exceeding $100 000 - $975 duty plus $2.75 for every $100 and also for any fractional part of $100 of the value of the consideration in excess of $50 000. Exceeding $100 000 but not exceeding $250 000 - $2 350 duty plus $3.25 for every $100 and also for any fractional part of $100 of the value of the consideration in excess of $100 000. Exceeding $250 000 but not exceeding $500 000 - $7 225 duty plus $3.50 for every $100 and also for any fractional part of $100 of the value of the consideration in excess of $250 000. Exceeding $500 000 - $15 975 duty plus $3.75 for every $100 and also for any fractional part of $100 of the value of the consideration in excess of 64 The Act was repealed by s 509 of the Duties Act 2001 (Q), but s 512 thereof provides for the continued application of the repealed statute to instruments executed before the commencement of the new statute. 65 Trust Co of Australia Ltd v Commissioner of Stamp Duties (2001) 47 ATR 418 at Callinan and purchaser exclude that right by agreement: Egmont v Smith66, Re Davies67, and Peter Butt, 'Purchaser "or nominee"'68. Mr Butt continued69: 'If the purchaser exercises the right, the vendor must transfer the property to the nominee instead of to the purchaser. However, a nomination does not substitute the nominee as the purchaser. The parties to the contract remain the vendor and the purchaser. If the purchaser breaches the contract, it is to the purchaser that the vendor must look for recourse, not the nominee: Nguyen v Taylor70. In this regard, a nomination is to be contrasted with an assignment of the contract. An assignee becomes entitled to all the purchaser's rights under the contract, once notice has been given to the vendor: Shaw v Harris (No 2)71. A nomination is also to be contrasted with a novation of the contract. A novation substitutes a new contract for the old one: Olsson v Dyson72'. Special conditions 11.1 and 11.3 of the contract of sale make it clear that the appellant was restricted to the role of transferee and that the role of purchaser, as it is understood in this context, fell to Cromwell and to it alone. That conclusion is enough to dispose of the argument advanced for the appellant that the appellant is entitled to the exemption provided for in s 54(6)." Thomas JA accepted that the term "purchaser" might bear different connotations in different contexts but thought that a dictum of Dixon J in Dudley Buildings Pty Ltd v Rose73 apt to disqualify the appellant from being the purchaser here because it did not assume obligations under the contract74: 66 (1877) 6 Ch D 469 at 474. 67 [1989] 1 Qd R 48 at 53. 68 (1997) 71 Australian Law Journal 12. 69 (1997) 71 Australian Law Journal 12 at 12. 70 (1992) 27 NSWLR 48 at 60. 71 (1992) 3 Tas R 167 at 207. 72 (1969) 120 CLR 365 at 389 73 (1933) 49 CLR 84. 74 (1933) 49 CLR 84 at 97. Callinan "The position of purchaser involves contractual obligations as well as rights. 'purchaser' connotes some of these obligations." The very expression The appeal to this Court The appellant's appeal is confined to one ground in this Court: "The Court below was wrong in deciding that the Appellant was not the purchaser named in the agreement dated 29 November 1999 between Riverfront Developments Pty Ltd, the Appellant and Cromwell Property Securities Ltd (that had been charged with duty pursuant to subsection 54(1) of the Act) for the purposes of subsection 54(6A) of the Act and, thus, was wrong in deciding that the instrument of transfer dated 29 November 1999 between Riverfront Developments Pty Ltd and the Appellant was not exempt from duty pursuant to subsection 54(6) of the Act." Section 49(1)(a) to (d) of the Act defines some of the terms used in it. "49(1) For the purposes of this Act: 'conveyance' and 'transfer' include every instrument and every decree or order of a court:- (a) whereby property is conveyed, transferred or assigned to or is vested in a person; or (b) whereby property is vested, without an instrument of conveyance, transfer or assignment, in any person upon notification to or registration or recording by the registrar or other person having the duty under an Act of noting, registering or recording a vesting or dealing in property; or (c) whereby property is vested, without an instrument of conveyance, transfer or assignment, whether by operation of law or otherwise; or (d) whereby a vesting of the kind specified in paragraph (c) is notified to or registered or required to be noted, registered or recorded by the registrar or other person having the duty under an Act of noting, registering or recording vestings or dealings in property …" And the same sub-section defines "transferee": Callinan "'transferee', in respect of a conveyance or transfer, means the person to whom property is conveyed, transferred or assigned or in whom property is vested." The term "transferee" is used in one place, in sub-s (6B) of s 54 of the Act which provides as follows: "Certain contracts to be chargeable as conveyances Any contract or agreement for sale of any property or any contract or agreement whereby a person becomes entitled or may, provided the terms and conditions thereof are met, become entitled to the conveyance or transfer of any property shall be charged with the same duty as if it were an instrument of conveyance of the property. Subsection (1) does not apply to a contract or agreement for sale of any property (other than any equitable estate or interest is property outside Queensland or which is solely comprised of any goods, livestock, wares or merchandise. in any property) which Where an agreement which creates an option or right of purchase of any property provides that such property, or any part thereof, shall be conveyed or transferred to any person pending the exercise of the option or right of purchase, or where, in connection with such an agreement, such property, or any part thereof, shall be, or be agreed in any other manner to be, so conveyed or transferred, the agreement creating the option or right of purchase shall, for the purposes of this section, be deemed to be an agreement for the sale of the whole of the property the subject of the option or right of purchase. The determination of such option or right of purchase shall be deemed to be a rescission of an agreement for sale. In order to obtain a refund of the duty on the rescission of any such agreement, the application for the refund of duty may be made at any time within the time limited by subsection (7A) or within 6 months after the date of such rescission whichever period is last to expire. Where any property has been conveyed or transferred pursuant to, or in connection with, the agreement, no refund of duty shall be made pursuant to subsection (7A) unless evidence is produced, satisfactory to the commissioner, that Callinan the property has been reconveyed or retransferred to the person by whom it was so conveyed or transferred and there shall be deducted from any such refund of duty, the duty which would have been paid on the consideration for such option or right of purchase but for the provisions of subsections (3) to (3B). If a company incorporated in Queensland or a corporation registered in Queensland acquires for a consideration in money or money's worth any property in Queensland and a contract or an agreement for the sale or an instrument of conveyance of the property is not executed or, being executed, is not duly stamped with ad valorem duty, then in the case of a company incorporated or a corporation registered in Queensland, the certificate of incorporation shall be deemed to be the instrument of conveyance of such property and, for the purposes of section 4B to have been signed or executed by the company or corporation and shall be chargeable accordingly with ad valorem conveyance duty. Where any property locally situate in Queensland is acquired for a consideration in money or money's worth, and the whole or any part of the conditions of such sale are set out or referred to in any instrument executed subsequently by any of the parties thereto, such instrument shall, unless a contract of sale or other the acquisition of the property, duly stamped, is produced, be chargeable with ad valorem conveyance duty in respect of the said sale, in addition to any other duty payable on the said instrument. instrument relating the conveyance or Where duty has been duly paid in conformity with the foregoing provisions, transfer or conveyances or transfers made to the purchaser shall upon production of the contract or agreement or contracts or agreements, duly stamped not be chargeable with any duty, and the commissioner, upon application, either shall denote the payment of the ad valorem duty upon the conveyance or transfer or conveyances or transfers, or shall transfer the ad valorem duty thereto. Subsection (6) does not apply in respect of a conveyance or transfer made to a person other than the person named as purchaser in the contract or agreement for sale to which the conveyance or transfer is intended to be pursuant unless the commissioner is satisfied that at the time the contract or Callinan agreement for sale was executed the person named therein as purchaser was acting in the transaction evidenced by such contract or agreement as agent for the person to whom the conveyance or transfer is made (either as a general agent or in relation to the particular transaction) and was so acting under authority given to him or her by such person in writing executed prior to the execution of the contract or agreement for sale. The commissioner shall not be satisfied for the purposes of subsection (6A) solely on the basis of a document which purports to be an authority given to the purchaser by the transferee in writing executed prior to the execution of the contract or agreement for sale. Where the purchaser under a contract or agreement for sale is expressed to be a named person or his or her nominee, then for the purposes of subsection (6A) the purchaser named therein shall be taken to be such named person. Neither the transaction nor the documents evidencing it with which the Court is concerned is within sub-ss (2), (3), (4), (5) or (6C) of s 54 of the Act. Sub-sections (6A) and (6B) will require separate consideration. The respondent's argument The Court of Appeal accepted the respondent's principal argument that duty had not been paid in conformity with s 54(1): that accordingly s 54(6) did not operate to relieve the appellant from liability for stamp duty on the transfer to it. The respondent's argument can be distilled into four propositions. The reference in s 54(6) to a purchaser must be taken to mean literally the person expressly named or identified as "purchaser" in the contract. The "purchaser" named in the contract is Cromwell and not the appellant. The use of the words "named as purchaser" in s 54(6A) shows that there is a real distinction between a person designated by a purchaser in, and by a contract, and anyone else who may take a transfer of the property the subject of it. It follows that the appellant is not the purchaser for the purposes of, or within the meaning of s 54(6) of the Act, and is therefore not entitled to any rebate of duty to the extent that stamp duty may already have been paid by a party to the contract. Callinan The argument, the respondent submits, is correct notwithstanding the purpose of the transaction and the consequences of it which Thomas JA in the Court of Appeal summarized in this passage75: "In this matter the Commissioner has exacted ad valorem stamp duty twice in respect of what was in substance a single sale of property. The relevant parties did not seek to avoid duty on the sale of the property or engage in manoeuvres for any extraneous purpose. In relation to the acquisition of a property they simply followed the rather complicated requirements of the Corporations Law and the Managed Investments Act 1998 (Cth) which are designed to protect members of the public in relation to managed the appointment of a 'custodian' to hold the relevant property." Those provisions require investment schemes. The respondent's argument fails Otherwise than to the extent that the Act may make provision for the payment of stamp duty in respect of transactions, or in respect of documents which the Act might require be brought into existence for the purpose of the imposition of stamp duty upon them, it is instruments upon which stamp duty has traditionally been leviable. If it were otherwise, and the parties were bound to look to the substance of the matter, there would be no question that the assessment by the respondent of the transfer for full ad valorem duty should be regarded as opportunistic and unmeritorious. Although it is not for the Court to decide the case on issues of merit, and effect must be given to the language of the Act, regard may, indeed should, be had in construing the Act to another dictum of Dixon J, in Executor Trustee & Agency Co of South Australia Ltd v Federal Commissioner of Taxation76: "No interpretation of a taxing Act should be adopted which results in the imposition of double taxation unless the intention to do so is clear beyond any doubt." I would reject the respondent's arguments. Among other matters, they fail to give due effect to s 54(1) of the Act in respect of which these points need be made. First, it refers to a "contract ... for sale of any property". The emphasis should be upon the singular: a contract, that is an arrangement for [one] sale of … [the] property: an entitlement to the [one] conveyance or [one] transfer of … property. The second matter to notice is that it does not use the word "purchase", "purchaser" or "transferee", but instead the person "entitled to the conveyance or 75 Trust Co of Australia Ltd v Commissioner of Stamp Duties (2001) 47 ATR 418 at 76 (1932) 48 CLR 26 at 44. Callinan transfer". Right from the outset here it was always intended, and the contract made clear that there would be only one and the same transferee under it, to the appellant. The contract here was a contract within the meaning of s 54(1) of the Act. It was a contract for the sale of a property. And it was one whereby a person, the appellant, became entitled to a transfer or conveyance of the property. Indeed, cl 10.1 of the contract obliged the vendor to ensure that the appellant obtain a good and valid title to it. The appellant acquired other rights under the contract. Each of these was enforceable by it. That is so in terms of the contract itself without recourse to ss 54 and 5577 of the Property Law Act 1974 (Q) which 77 "54 Effect of joint contracts and liabilities (1) Subject to this and to any other Act - (a) a promise made by 2 or more persons shall, unless a contrary intention appears, be construed as a promise made jointly and severally by each of those persons; and (b) a liability which is joint shall not be discharged, nor shall a cause of action with respect to the liability be extinguished, because of any fact, event, or matter except to the extent that the same would because of the fact, event or matter be discharged or extinguished if the liability were joint and several and not joint. (2) In this section - 'promise' includes a promise under seal, a covenant, whether express or implied under this Act, and a bond or other obligation under seal. 55 Contracts for the benefit of third parties (1) A promisor who, for a valuable consideration moving from the promisee, promises to do or to refrain from doing an act or acts for the benefit of a beneficiary shall, upon acceptance by the beneficiary, be subject to a duty enforceable by the beneficiary to perform that promise. (2) Prior to acceptance the promisor and promisee may, without the consent of the beneficiary, vary or discharge the terms of the promise and any duty arising from it. (3) Upon acceptance - (a) the beneficiary shall be entitled in the beneficiary's own name to such remedies and relief as may be just and convenient for the enforcement of the (Footnote continues on next page) Callinan duty of the promisor, and relief by way of specific performance, injunction or otherwise shall not be refused solely on the ground that, as against the promisor, the beneficiary may be a volunteer; and (b) the beneficiary shall be bound by the promise and subject to a duty enforceable against the beneficiary in the beneficiary's own name to do or refrain from doing such act or acts (if any) as may by the terms of the promise be required of the beneficiary; and (c) the promisor shall be entitled to such remedies and relief as may be just and convenient for the enforcement of the duty of the beneficiary; and (d) the terms of the promise and the duty of the promisor or the beneficiary may be varied or discharged with the consent of the promisor and the beneficiary. (5) In so far as a duty to which this section gives effect may be capable of creating and creates an interest in land, such interest shall, subject to section 12, be capable of being created and of subsisting in land under any Act but subject to that Act. (6) In this section - 'acceptance' means an assent by words or conduct communicated by or on behalf of the beneficiary to the promisor, or to some person authorised on the promisor's behalf, in the manner (if any), and within the time, specified in the promise or, if no time is specified, within a reasonable time of the promise coming to the notice of the beneficiary. 'beneficiary' means a person other than the promisor or promisee, and includes a person who, at the time of acceptance is identified and in existence, although that person may not have been identified or in existence at the time when the promise was given. 'promise' means a promise - (a) which is or appears to be intended to be legally binding; and (b) which creates or appears to be intended to create a duty enforceable by a beneficiary; and includes a promise whether made by deed, or in writing, or, subject to this Act, orally, or partly in writing and partly orally. 'promisee' means a person to whom a promise is made or given. (Footnote continues on next page) Callinan almost certainly would also have independently conferred a right upon the appellant to call for the [one] transfer of the property. What is obvious is that the drafter of the contract did not pay sufficient attention to the formulation of the various parties' rights and obligations arising under it. The provisions of cl 4(1) which imposed the duty of purchasing upon the appellant (and not Cromwell) was, for a start, apparently overlooked. But the true nature of the transaction is equally obvious from the contract itself: as one of sale to be effected by one vendor to one transferee, as legal owner, for money from one original source, the investors. Accordingly the contract was chargeable "with the same duty as if it were an [or the] instrument of conveyance of the property" in accordance with s 54(1) of the Act. The fact of only one sale, one contract, one purchase price, and one person entitled to the transfer, all strongly suggests, and the language of s 54(1) in my opinion, requires, that there should, and will be only one exaction of stamp duty. Duty has, therefore, to use the language of s 54(6) "been duly paid in conformity with [one of] the foregoing provisions", that is s 54(1) of the Act. Even so, the respondent submits, there is a further requirement imposed by sub-s (6), that the transfer be made to "the purchaser", a requirement that is not satisfied here. It is true that the legal personality identified as the purchaser in the contract is Cromwell. It is also true that the solicitors who submitted the contract and the transfer to the respondent for assessment of stamp duty described Cromwell as the "proper party to be nominated as the Purchaser in the Contract of Sale" in their letter of 3 December 1999 which I earlier set out. Neither a description nor a misdescription in the letter, or indeed in the contract itself, can be determinative of the question whether the appellant is capable of being "the purchaser" within the meaning of s 54 of the Act, any more than a misdescription of a purchaser as someone other than a purchaser could be determinative of the application of the section. The Act does not contain any definition of a purchaser. There is no reason here why "purchaser" as used in s 54(6) should not be regarded as a term which is relevantly interchangeable with the expression, "whereby a person becomes entitled ... to the ... transfer" pursuant to the contract, referred to in s 54(1). The language of the whole section does not dictate any contrary conclusion. Furthermore, an analysis of the contract itself does not require any different an answer. 'promisor' means a person by whom a promise is made or given. (7) Nothing in this section affects any right or remedy which exists or is available apart from this section." Callinan The appellant was at all times intended to be, and is described as "the custodian", an expression which has no particular significance except for the purposes of the Corporations Law. As a result of the amendments to the standard form contract, the appellant became entitled, for example, to all documents in the possession of the vendor which it or Cromwell might reasonably require to manage the property, and to prepare custodian terms in respect of it. By the amended cl 7.4 of the contract, the custodian or Cromwell was entitled to terminate the contract in the event of default by the vendor. And in the event of such a termination, the custodian would be entitled to a refund of the deposit and other money that may have been paid to the vendor pursuant to the contract. These provisions are sufficient to indicate that the appellant, which was a party to the contract, had real and substantial rights under it, including its enforcement, rights in effect as an alternative to Cromwell. It was always contemplated that the custodian would become the legal owner, that is to say, the registered owner under the Land Titles Act 1994 (Qld) of the property. This follows from the express language of cll 11.1 and 11.2 of the contract. And cl 11.6 is an acknowledgment by the vendor that Cromwell and the appellant entered into the contract as "responsible entity" and as "custodian" of the scheme and in no other capacity, and that accordingly their liability under the contract is strictly limited to the extent that it can be satisfied out of the property of the scheme, and to the extent that they can be actually indemnified for any such liability. It seems to me that there is no reason why, under the contract the appellant might, or could not have been described as the purchaser. Indeed, the custodianship agreement expressly contemplated it. It was no more the original source of the purchase price than the appellant was. The funds for the purchase were sourced from the money provided by the investors under the scheme which both Cromwell and the appellant were bound to use strictly in accordance with it, including the provision of one purchase price to the vendor to enable, not Cromwell but the appellant to take one transfer and title to the property. Cromwell had no right to nominate any other transferee or purchaser. Only the appellant could be the transferee. It seems to me to have been a misnomer to describe Cromwell, which was the mere manager, and relevantly a conduit pipe of the investor's funds to the vendor, as the purchaser. Again, to paraphrase language used by Dixon J, this was a case in which "the [that is one] contract entered into by the appellant contemplated and the [appellant] … took the transfer because that is what the parties to the contract intended.78" In those circumstances, the requirements of s 54(1) have been satisfied. I am prepared to read "purchaser" in s 54(6) as a reference to the appellant, as the legal personality actually taking the transfer following production of the agreement under, and in pursuance of which it was executed. It may also be noted that it was not 78 Vickery v Woods (1952) 85 CLR 336 at 345. Callinan suggested by the respondent that a reading of the sub-section in this way had any bearing upon, or implications for the operation of any other sections of the Act. Something should be said about s 54(6A) of the Act. It could not in my opinion operate to exclude the operation of s 54(6) even if the appellant were not "named as purchaser in the contract". Cromwell is nowhere described as an agent, but the relationship between it and the appellant was governed by obligations of a fiduciary kind and of a strict nature well capable of being described as giving rise to a relationship of agency. Indeed, the custodianship agreement did not permit Cromwell to purchase the property or take a transfer of it itself. Accordingly, in entering the contract, Cromwell must have been acting in a fiduciary capacity or as an agent on behalf of the appellant (and ultimately the scheme members) for the proposed legal owner, the appellant. Furthermore, there was in existence before the execution of the contract an authority, the custodianship agreement itself, obliging Cromwell not to take the transfer, but so to conduct itself as to ensure that the appellant did so. One of the respondent's arguments was that amendments which were made to the Act in 2000 were designed to cover this situation, and to relieve a custodian such as the appellant from liability for duty on the transfer: accordingly, if the Act before 2000 had that effect, the amendments were unnecessary. Assuming, as I am prepared to do, that the amendments would cover this case and operate to relieve the appellant from a liability for duty, I still do not regard the fact of the amendments as requiring a different interpretation of s 54 as it stood at the time of this transaction. Section 54 before 2000 is far from pellucid. The amendments may have been designed to make clear what was obscure before. Recently, this Court has expressed reservations about the use to which amendments to enactments may be put to construe pre-amendment legislation79. Misapprehensions are from time to time held by legislatures about the effect of legislation: for example, in Queensland Electricity Generating Board v New Hope Collieries Pty Ltd80 the Privy Council held that an enactment of the United Kingdom Parliament which had been expressly repealed by the Queensland Legislature had never applied in the State. I would allow the appeal with costs and make the following orders. The questions posed in the Case Stated to the Queensland Court of Appeal should be answered as follows: 79 Commissioner of State Revenue v Pioneer Concrete (Vic) Pty Ltd (2002) 76 ALJR 1534; 192 ALR 56. [1989] 1 Lloyd's Rep 205. Callinan Question (a) Question (b) Question (c) Question (d) Question (e) Question (f) Question (g) Yes; Unnecessary to answer; Unnecessary to answer; Unnecessary to answer; (the condition can be ignored) Yes; No; Nil; The costs of and incidental to the stating of the case and the appeal should be borne by the respondent. The costs of and incidental to this appeal should be borne by the respondent.

HIGH COURT OF AUSTRALIA PLAINTIFF AND THE COMMONWEALTH OF AUSTRALIA DEFENDANT Blunden v Commonwealth of Australia [2003] HCA 73 10 December 2003 ORDER Answer the questions reserved in the Case Stated as follows: On the basis of the Statement of Agreed Facts, to the extent that the plaintiff alleges negligence on the part of servants or agents of the defendant in international waters: Question (a) Is the plaintiff's action subject (by operation of ss 56, 79, 80 and 80A of the Judiciary Act 1903 (Cth) or otherwise) to the statutory limitation period prescribed by s 3 of 21 Jac I c 16 (as it applied in the ACT) or alternatively by s 11 of the Limitation Act 1985 (ACT), as alleged in par 7 of the defendant's amended defence dated 14 December 2001, filed in the Supreme Court of the Australian Capital Territory in proceedings SC 324 of 1998 ("the amended defence")? Answer The plaintiff's action is subject to the provisions of the Limitation Act 1985 (ACT). Question (b) Is the plaintiff's action subject (by operation of ss 56, 79, 80 and 80A of the Judiciary Act 1903 (Cth) or otherwise) to the statutory limitation period prescribed by s 3 of 21 Jac I c 16 (as it applied in NSW) or alternatively s 14(1) and/or s 63(1) of the Limitation Act 1969 (NSW), as alleged in pars 7 and 8 of the amended defence? Answer Question (c) Is the plaintiff's action subject to none of the statutory limitation periods pleaded in pars 7 and 8 of the amended defence, as alleged in par 2 of the plaintiff’s reply dated 8 February 2002 filed in the Supreme Court of the Australian Capital Territory in proceedings SC 324 of 1998? Answer Does not arise. Representation: G F Little SC with E J Techera for the plaintiff (instructed by Pamela Coward & Associates) D M J Bennett QC, Solicitor-General of the Commonwealth with A W Street SC, P J Hanks QC and T M Howe for the defendant (instructed by Australian Government Solicitor) Interveners: M G Sexton SC, Solicitor-General for the State of New South Wales with M J Leeming for the Attorney-General for the State of New South Wales (instructed by Crown Solicitor for New South Wales) C J Kourakis QC, Solicitor-General for the State of South Australia with N D Charlesworth intervening on behalf of the Attorney-General for the State of South Australia (instructed by Crown Solicitor's Office (South Australia)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Blunden v Commonwealth of Australia Federal jurisdiction – Tort – Negligence – Accident on high seas – Action commenced by plaintiff in Supreme Court of Australian Capital Territory – Limitation law – Application of s 80, Judiciary Act 1903 (Cth) – Whether limitation law of Australian Capital Territory applies – Whether "laws of the Commonwealth" include common law of Australia unmodified by statute law in force in forum – Whether scope for adoption of additional common law choice of law rule. Constitution, s 75(iii). Judiciary Act 1903 (Cth), ss 56, 79, 80. Limitation Act 1985 (ACT), ss 11, 36, 56. Navigation Act 1912 (Cth), ss 260, 261, 261A. Limitation Act 1623 (21 Jac I c 16), s 3. GLEESON CJ, GUMMOW, HAYNE AND HEYDON JJ. At night on 10 February 1964, two ships of the Royal Australian Navy came into collision on the high seas some 18 miles off the Australian coast. The ships were the aircraft carrier HMAS Melbourne and the destroyer HMAS Voyager. The ships were exercising together. They had sailed to the exercise area from Jervis Bay. The Melbourne struck the Voyager and the Voyager sank. The litigation, an element of which is before the Full Court on a Case Stated by a single Justice, arises from those events. At the time of the collision, the plaintiff, Mr Blunden, was serving as an Able Seaman on the Melbourne. The Supreme Court action On 14 May 1998, long after the events of 10 February 1964, Mr Blunden instituted an action in the Supreme Court of the Australian Capital Territory ("the Territory") against the Commonwealth of Australia. He seeks damages for injuries and disabilities suffered by reason of the responsibility of the Commonwealth for negligent acts and omissions with respect to the collision between the Melbourne and the Voyager. The injuries and disabilities specified are: "Chronic post-traumatic stress disorder Major depressive disorder Alcohol abuse Shock and sequelae". By order made 11 March 2003, there was removed into this Court pursuant to s 40(2) of the Judiciary Act 1903 (Cth) ("the Judiciary Act"): "[t]he part of the cause involving the question of what, if any, limitation law applies to the plaintiff's claim for damages, in so far as it relates to any negligent acts or omissions by servants or agents of the Commonwealth in international waters". The Case Stated poses questions designed to resolve that issue by identification of the applicable limitation statute law, if there be any. The events of 10 February 1964 gave rise to earlier litigation in this Court. Parker v The Commonwealth1 was an action brought in the original jurisdiction by the dependants of a member of the company of the Voyager who lost his life (1965) 112 CLR 295. at sea. Mr Parker was on the ship in a purely civil capacity and thus was not disqualified under the law, as it then was understood2, from bringing an action for negligence3. The action was heard in 1965 by Windeyer J, sitting in Melbourne. His Honour applied the law of Victoria4. The issues which arise in this case did not fall for decision in Parker. By its defence to Mr Blunden's action, the Commonwealth pleads in the alternative that the action was barred or extinguished or was not maintainable by reason of the law with respect to limitation of actions in force in the Territory or in force in New South Wales. In that regard, nothing turns upon the classification once given to limitation laws as procedural in nature. Section 56 of the Limitation Act 1985 (ACT) ("the Limitation Act") states: "If the substantive law of another place being a State, another Territory or New Zealand, is to govern a claim before a court of the Territory, a limitation law of that place is to be regarded as part of that substantive law and applied accordingly by the court." At the relevant time, the expression "limitation law" was defined in s 55 as meaning: "a law that provides for the limitation or exclusion of any liability or the barring of a right of action in respect of a claim by reference to the time when a proceeding on, or the arbitration of, the claim is commenced". The statute law of New South Wales and elsewhere now make similar provision5. In their operation with respect to the limitation laws of other States and Territories, ss 55 and 56 of the Limitation Act reflect what subsequently in John Pfeiffer Pty Ltd v Rogerson was recognised by all members of the Court as the common law in Australia6. cf Groves v The Commonwealth (1982) 150 CLR 113. 3 Parker v The Commonwealth (1965) 112 CLR 295 at 301-305. (1965) 112 CLR 295 at 306-307. 5 Choice of Law (Limitation Periods) Act 1993 (NSW). (2000) 203 CLR 503 at 542-544 [97]-[100], 563 [161], 574 [193]. The jurisdiction of the Supreme Court Section 56 of the Judiciary Act provides, among other things, that a person making a claim against the Commonwealth in tort may bring suit against the Commonwealth, where the claim did not arise in a State or Territory, in the Supreme Court of any State or Territory (s 56(1)(c)). All process in that suit which is required to be served upon the Commonwealth shall be served upon the Attorney-General or upon some other person appointed to receive service (s 63). It is accepted by the parties that the jurisdiction invoked by the institution of the action in the Supreme Court of the Australian Capital Territory was federal jurisdiction. The relevant head of federal jurisdiction was that in s 75(iii) of the Constitution, and thus was attracted by the identity of a party, namely the Commonwealth, as the defendant7. It is established by The Commonwealth v Mewett8 that the liability of the Commonwealth in tort is created by the common law and that s 75(iii) of the Constitution denies any operation to doctrines of Crown or Executive immunity which otherwise might be pleaded in an action to recover damages in respect of a common law cause of action. The applicable law The question then becomes one of identification of the applicable body of law by which the controversy is to be resolved through the exercise of judicial power. That inquiry as to the applicable law in federal jurisdiction is distinct from, though it may involve, the identification of choice of law rules. The distinction was emphasised in the joint judgment in Pfeiffer9. It has significance for the present case. The Commonwealth in its submissions contends for the recognition of a common law choice of law rule in terms which would render it curially applicable only in the exercise of a particular species of federal jurisdiction. 7 Re McJannet; Ex parte Minister for Employment, Training and Industrial Relations (Q) (1995) 184 CLR 620 at 653. (1997) 191 CLR 471. See also Austral Pacific Group Ltd (in liq) v Airservices Australia (2000) 203 CLR 136 at 157 [59]; Smith v ANL Ltd (2000) 204 CLR 493 at 502 [16]; and British American Tobacco Australia Ltd v Western Australia (2003) 77 ALJR 1566; 200 ALR 403. (2000) 203 CLR 503 at 527-528 [43], 530-531 [53]-[54]. For his part, the plaintiff founds upon the reasoning in the following passage from the judgment of Gaudron and Gummow JJ in Smith v ANL Ltd10: "There was no law of the Commonwealth which enacted a limitation regime of general operation to civil actions pursued in federal jurisdiction. That meant that, unless and until the operation of the [Judiciary Act] was enlivened, the common law applied and there was no limitation period which operated in respect of Mr Smith's causes of action11." (emphasis added) The substance of the submissions for the plaintiff is that, whilst there has been attracted the provisions of that statute providing for the jurisdiction of the Supreme Court in his action against the Commonwealth, there has not been attracted those provisions, in particular s 80 of the Judiciary Act, which would apply in that action modifications made by the statute law of the Territory to the common law with respect to limitations. Preliminary matters There are preliminary matters to be noted before dealing with the case presented by the plaintiff. Actions in tort for negligence are classified as transitory actions. Of those actions, it was said in the joint judgment in Lipohar v "Transitory actions (i) may be sued upon in the forum if it has jurisdiction over the person of the defendant; (ii) this is so regardless of the 'law area' where the facts creating the cause of action happened to occur; but (iii) one or more issues may be determined by the court of the forum by reference to a 'choice' it makes, under its common law rules, of the law of another 'law area' as the lex causae." (footnote omitted) That passage makes the point later developed in Pfeiffer that questions of jurisdiction, in the sense of authority to decide, are logically distinct, and better kept separate, from choice of law questions13. 10 (2000) 204 CLR 493 at 503 [17]. 11 See Georgiadis v Australian and Overseas Telecommunications Corporation (1994) 179 CLR 297 at 301, 312. 12 (1999) 200 CLR 485 at 527 [105]. 13 (2000) 203 CLR 503 at 521-522 [25]-[28]. What was said in Lipohar and Pfeiffer is to be read with the later rejection in The Commonwealth v Yarmirr14 of the submission that the common law in Australia does not "extend", "apply" or "operate" beyond low-water mark and the rejection of the corollary that, absent statute, no rights deriving from events occurring beyond that limit may be enforced in Australian courts. That body of common law includes what sometimes has been called the general principles of maritime law or the maritime law of the world. The point was explained, with particular reference to England, by Lord Diplock in The Tojo Maru15. His "Outside the special field of 'prize' in times of hostilities there is no 'maritime law of the world,' as distinct from the internal municipal laws of its constituent sovereign states, that is capable of giving rise to rights or liabilities enforceable in English courts. Because of the nature of its subject-matter and its historic derivation from sources common to many maritime nations, the internal municipal laws of different states relating to what happens on the seas may show greater similarity to one another than is to be found in laws relating to what happens upon land. But the fact that the consequences of applying to the same facts the internal municipal laws of different sovereign states would be to give rise to similar legal rights and liabilities should not mislead us into supposing that those rights or liabilities are derived from a 'maritime law of the world' and not from the internal municipal law of a particular sovereign state." In the present action, the Supreme Court of the Territory had the necessary jurisdiction over the transitory action by reason of s 56 of the Judiciary Act and the amenability of the Commonwealth to service of the process of the Supreme Court in accordance with s 63 of that Act. The Supreme Court had the necessary federal jurisdiction by reason of the identity of the defendant. It should be mentioned here that Mr Blunden did not seek to invoke the jurisdiction conferred upon the Supreme Court of the Territory by ss 9 and 39 of the Admiralty Act 1988 (Cth) ("the Admiralty Act") in respect of proceedings 14 (2001) 208 CLR 1 at 45-46 [34]-[35]. 16 [1972] AC 242 at 290-291. See also Moragne v States Marine Lines Inc 398 US commenced as actions in personam on a maritime claim17. The critical events pre-dated the commencement of the Admiralty Act by many years. That makes it unnecessary to consider the construction of the limitation provision in s 37 of that Act. Nor is there any occasion to consider the basis upon which under earlier Imperial legislation English courts of Admiralty entertained actions in respect of damage sustained on the high seas and arising out of the operation of Royal Navy ships18. Nor do questions arise respecting the doctrine of laches as developed in courts of Admiralty19. Rather, the general position with respect to actions on the case such as that for negligence is that, statute apart, there is no limitation bar at common law. Section 80 of the Judiciary Act What then is the applicable law in the action commenced by Mr Blunden? That inquiry directs attention, in the first instance, to s 80 of the Judiciary Act. This states: "So far as the laws of the Commonwealth are not applicable or so far as their provisions are insufficient to carry them into effect, or to provide adequate remedies or punishment, the common law in Australia as modified by the Constitution and by the statute law in force in the State or Territory in which the Court in which the jurisdiction is exercised is held shall, so far as it is applicable and not inconsistent with the Constitution and the laws of the Commonwealth, govern all Courts exercising federal jurisdiction in the exercise of their jurisdiction in civil and criminal matters." (emphasis added) It will be convenient later in these reasons to refer further to the emphasised passage in s 80; it is this to which the submissions for the plaintiff direct particular attention. The next step, if it is necessary to take it to provide an answer to the particular question that arises, is provided by s 79 of the Judiciary Act. That states: 17 Rule 5 of the Admiralty Rules 1988 prescribes a particular form for documents filed in proceedings under the principal Act. 18 HMS Sans Pareil [1900] P 267; The Hero [1911] P 128; affd [1912] AC 300. See also HMS Inflexible (1856) Swab 32 [166 ER 1003]. 19 See Moragne v States Marine Lines Inc 398 US 375 at 406 (1970). "The laws of each State or Territory, including the laws relating to procedure, evidence, and the competency of witnesses, shall, except as otherwise provided by the Constitution or the laws of the Commonwealth, be binding on all Courts exercising federal jurisdiction in that State or Territory in all cases to which they are applicable." (emphasis added) In The Commonwealth v Mewett20, Gaudron J emphasised that (i) s 80 is one of the "laws of the Commonwealth" to which s 79 is expressly subjected and (ii) the application, in the exercise of federal jurisdiction, of the common law rules for choice of law is directed by s 80. To proposition (ii), two points should be added. The first is that the application of any rules of the common law will, in the terms of s 80, be subjected to any modification, in the present case, by the statute law in force in the Territory. The second is that, if there is no common law choice of law rule relevant to the issues in the litigation, but the common law rule as to the absence of time bars is modified by Territory law, then s 80 applies that modification, and this furnishes the limitation law which governs the action. Counsel for Mr Blunden submitted that Territory law could not be brought into play in this way because to do so would be to "enlarge the reach" of the Limitation Act. That submission should be rejected. The Limitation Act plainly applies to actions instituted in the Supreme Court. That institution in the Territory court supplies the connecting link with the Territory statute. It is not to the point that the events giving rise to the cause of action upon which the plaintiff relies occurred on the high seas. In its submissions, the Commonwealth correctly emphasised that the issues reflected in the order for removal into this Court were left open in Regie Nationale des Usines Renault SA v Zhang21. In the joint judgment of five members of the Court in Renault22, the following passage appears: "The submission by the Renault companies is that the reasoning and conclusion in Pfeiffer that the substantive law for the determination of rights and liabilities in respect of intra-Australian torts is the lex loci delicti should be extended to foreign torts, despite the absence of the significant factor of federal considerations, and that this should be without 20 (1997) 191 CLR 471 at 522. 21 (2002) 210 CLR 491. 22 (2002) 210 CLR 491 at 520 [75]-[76]. the addition of any 'flexible exception'. That submission should be accepted. [emphasis added] To that outcome, several caveats should be entered. In Pfeiffer, reference is made to the difficulty in identifying a unifying principle which assists in making the distinction, in this universe of discourse, between questions of substance and those of procedure. The conclusion was reached that the application of limitation periods should continue to be governed by the lex loci delicti and, secondly, that23: 'all questions about the kinds of damage, or amount of damages that may be recovered, would likewise be treated as substantive issues governed by the lex loci delicti.' (Original emphasis.) We would reserve for further consideration, as the occasion arises, whether that latter proposition should be applied in cases of foreign tort. We also would reserve for further consideration in an appropriate case the Moçambique rule24 and the standing of Potter v Broken Hill Proprietary Co Ltd25. Special considerations also apply to maritime torts and what Dicey calls 'aerial' torts26." (emphasis added) Three points are to be made here. First, some care is needed with the expression "foreign tort". What it identifies is a foreign system of law in force at the locus delicti. It is that foreign legal system for which allowance is made by the common law rules of choice of law in the particular forum. Secondly, where, as in this case, the relevant events giving rise to a "maritime tort" occurred on the high seas, one asks what body of law other than that in force in the forum has any better claim to be regarded by the forum as the body of law dispositive of the action litigated in the forum?27 23 John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 544 [100]. 24 After British South Africa Co v Companhia de Moçambique [1893] AC 602. 25 (1906) 3 CLR 479. 26 Collins (ed), Dicey and Morris on The Conflict of Laws, 13th ed (2000), vol 2 at 27 cf Foote, A Concise Treatise on Private International Law, 5th ed (1925) at 524. Thirdly, as is implicit in posing the issue in that way, there is no scope here for the application of what has been called the "vested rights theory" or "obligation theory". This would treat the law in force at the place of the wrongful act as the only possible source of the obligation Mr Blunden seeks to enforce and this would determine both the existence of the obligation and its extent. The theory, associated with the judgment of Willes J in Phillips v Eyre28 and Holmes J in Slater v Mexican National Railroad Co29, was rejected in Koop v Bebb30 and that rejection was affirmed in Pfeiffer31. In any event, the facts of the present case illustrate the deficiencies of the theory, there being no foreign legal system operative at the locus delicti to provide the source of the obligation32. The "floating island" metaphor upon which the plaintiff relies for one branch of the argument is an unsuccessful attempt to accommodate the vested rights theory to the facts. It will be necessary to return to that aspect of the submissions. It should be stressed that this case does not present any issues that may appear in other cases of tort actions arising on the high seas. Various questions may arise in those actions. They may include the significance to the forum of the interest of the law of the flag of a foreign vessel in its "internal economy"33 or the interest of the law of the place in a federal nation where a relevant ship is registered34. In the case of proceedings not brought in Admiralty, but arising out 28 (1870) LR 6 QB 1 at 28. 30 (1951) 84 CLR 629 at 644. 31 (2000) 203 CLR 503 at 526-527 [39]-[40]. See also Pozniak v Smith (1982) 151 CLR 38 at 52-53, and cf the references to the judgment of Willes J in Phillips v Eyre by Lord Scott of Foscote in Kuwait Airways Corpn v Iraqi Airways Co (Nos 4 and 5) [2002] 2 AC 883 at 1119-1120, 1123. 32 cf Hancock, Torts in the Conflict of Laws, (1982) at 271-272; Finlayson, "Shipboard torts and the conflict of laws", (1986) 16 Victoria University of Wellington Law Review 119 at 143. 33 cf Re Maritime Union of Australia; Ex parte CSL Pacific Shipping Inc (2003) 77 ALJR 1497 at 1506-1507 [49]-[54]; 200 ALR 39 at 51-53. 34 cf Canadian National Steamships Company Ltd v Watson [1939] SCR 11; Cotter v Huddart Parker Ltd (1941) 42 SR (NSW) 33 at 46; revd on other grounds (1942) 66 CLR 624; Tetley, "Choice of Law – Tort and Delict – Common Law/Civil Law/Maritime Law – Maritime Torts", (1993) 1 Tort Law Review 42; Dicey and (Footnote continues on next page) of a collision between vessels of different flags, they may include consideration of whether there is any reason not to apply the law of the forum35. The Commonwealth emphasised that the ships of the Royal Australian Navy, in 1964 and at present, do not have a port or place of registration in the sense of that seen in statutes such as Pt V of the Shipping Registration Act 1981 (Cth). Nor, in 1964, did the Royal Australian Navy recognise for its ships the concept of a "home port". The plaintiff's submissions As already noted, the plaintiff maintains that the common law applies in its pristine form, without modification by any applicable statute. That consequence is said to flow from a particular construction placed upon the opening words of s 80. Those opening words condition the operation of the balance of s 80 upon two circumstances. The first is that "the laws of the Commonwealth" are not applicable. The second is that the provisions of "the laws of the Commonwealth" are insufficient to carry them into effect or to provide adequate remedies or punishment. The submission for the plaintiff is that the expression "the laws of the Commonwealth" includes the common law in Australia and is not confined to statute law. The phrase "the laws of the Commonwealth" appears elsewhere than in s 80. In The Commonwealth v Colonial Combing, Spinning and Weaving Co Ltd36, Knox CJ and Gavan Duffy J said37: "The phrase 'the laws of the Commonwealth' is found in [covering cl 5] of the Commonwealth of Australia Constitution Act and in various places in the Constitution itself. In every case it probably means Acts of the Parliament of the Commonwealth." Morris, The Conflict of Laws, 13th ed (2000), vol 2, §35-066-§35-070. See also as to the territorial sea Union Shipping New Zealand Ltd v Morgan (2002) 54 NSWLR 690 at 730-733, 735-736. 35 cf Lloyd v Guibert (1865) LR 1 QB 115; Chartered Mercantile Bank of India v Netherlands India Steam Navigation Co (1883) LR 10 QBD 521. 36 (1922) 31 CLR 421. 37 (1922) 31 CLR 421 at 431. See also Re Colina; Ex parte Torney (1999) 200 CLR Here, the expression is to be read with the section in which it appears, taken as a whole. The text of s 80 speaks on the one hand of the common law in Australia and on the other hand of the modification thereof by the Constitution and statute law. The phrase "the laws of the Commonwealth" in the opening words of s 80 plainly identify statute law. The plaintiff from this false basis sought to develop the argument that the Australian common law was not insufficient in any way and that it supplied the lex loci delicti. Therefore, it was said, the balance of s 80 was not applicable and the Limitation Act did not enter the picture. This argument also should be rejected. One asked, so the submission ran, where the tort occurred on the high seas, what was the law applying to the place of the tort and the answer was that it was the Australian common law because the tort occurred on an Australian ship "carrying its Australian law". Involved in that approach to the matter is the long discredited "floating island" theory. In 1883, Lindley LJ described the analogy whereby ships were identified with the territory of the states to which they belong as a "fruitful source of error" and as "more often misleading than the reverse"38. Later, Lord Atkin, in giving the decision of the Privy Council in Chung Chi Cheung v The King, said39: "However the doctrine of extraterritoriality is expressed, it is a fiction, and legal fictions have a tendency to pass beyond their appointed bounds and to harden into dangerous facts. The truth is that the enunciators of the floating island theory have failed to face very obvious possibilities that make the doctrine quite impracticable when tested by the actualities of life on board ship and ashore." Moreover, the attempt to invoke the "floating island" theory was misplaced. In the present case, the two ships were Royal Australian Navy ships and the action is brought in an Australian court. The theory, as Chung Chi Cheung illustrates, treated men of war and public ships of a foreign state as part of the territory of that foreign state, with the consequence that the jurisdiction of the forum court would be excluded for certain purposes, in particular in respect of acts done or persons found on the foreign ship. The present case concerns 38 Chartered Mercantile Bank of India v Netherlands India Steam Navigation Co (1883) 10 QBD 521 at 544-545. 39 [1939] AC 160 at 174. See also Cunard v Steamship Co v Mellon 262 US 100 at 123 (1923); O'Connell, The International Law of the Sea, (1984), vol 2 at 735-737. neither a foreign ship nor the jurisdiction of the Supreme Court of the Territory but the identification of the applicable law in the exercise of federal jurisdiction which has properly been invoked. The plaintiff also submitted, again upon the foundation of the particular construction he seeks to give to the opening words of s 80, that it is the common law, in its form modified by the Navigation Act 1912 (Cth) ("the Navigation Act"), which is adequate to provide remedies with procedures to carry them into effect. The consequence, again, is said to be that there is no occasion for the operation of the balance of s 80 to attract the operation of the Australian common law as modified, relevantly, by the Limitation Act. That submission should not be accepted. The particular provisions in the Navigation Act to which reference was made are ss 260 and 261. They appear in Div 11 of Pt V of the Act, the Division being headed "Collisions, loss and damage". The sections are stated by s 261A40 to "apply in the case of ships belonging to the Australian Navy as they apply in the case of other ships". Section 260 provides for the liability of the owners of ships to be joint and several: "[w]here loss of life or personal injuries are suffered by any person on board a ship owing to the fault of that ship and of any other ship or ships". It does not speak to Mr Blunden's claim. In the unusual circumstances of this case, both ships were in the same ownership. Nor does s 261. That provides a right of contribution in the circumstances where s 260 operates. In any event, the fundamental point remains that, to Mr Blunden's claim, the provisions of the federal statute law, s 80 itself apart, would be insufficient to provide him with any adequate remedies. It is necessary for him to look to the common law in Australia to provide the liability of the Commonwealth in tort and for s 75(iii) of the Constitution to deny any immunity the Commonwealth might otherwise have enjoyed. The applicable law in the exercise of the necessary federal jurisdiction is by s 80 directed to be the common law in Australia as modified, for Mr Blunden's action, by the statute law in force in the Territory. It is not possible for Mr Blunden to fashion a case whereby in the adjudication of his claim there is applied by s 80 the common law in its pristine form. 40 Added by the Navigation Act 1958 (Cth) and amended by the Navigation Amendment Act 1979 (Cth) and the Navigation Amendment Act 1980 (Cth). The Commonwealth's submissions The preferred submission for the Commonwealth is that, in the circumstances of the present case, there should be recognised as an appendix to the common law choice of law rules in Australia a proposition as follows: "Where the events giving rise to the Commonwealth's liability occur in international waters and involve ships that carry the flag of a federal nation but which (unlike merchant vessels) do not have a port of registration, the locus delicti is that law area within Australia with which the events have the closest relevant connection." It is then said that in the case of the collision between the Melbourne and the Voyager on 10 February 1964, that place was the Territory as the seat of the administration and operation of the Royal Australian Navy. A secondary submission is based upon observations by Gaudron J in Mewett41 that the events in question there had their closest connection with the last port of the ship on which the plaintiffs were injured. The submission now made is that on the facts of the present case the closest relevant connection was with New South Wales, thereby engaging the limitation law of that State. The Jervis Bay area was said to extend beyond the Territory bearing that name and into New South Wales. The Commonwealth submissions then proceed by recourse to s 80 of the Judiciary Act. It is submitted that, within the meaning of that section, the common law in Australia provides as stated above and that in this respect the common law is not modified by the Constitution or (on the primary submission) by the statute law in force in the Territory. The outcome of that process would be to treat as applicable the provisions of the Limitation Act. It will be necessary later in these reasons to refer further to those provisions. Before doing so, it is convenient to consider the outcome which would follow if s 80 were applied, but on the footing that the common law choice of law rules did not include the modification or addition for which the Commonwealth contends and thus did not speak to this case. If s 80 be read in that way, the result is directly achieved that the common law in Australia with respect to absence of time limitations of personal actions is modified with respect to the Territory by the Limitation Act, and that statute speaks to actions such as the present instituted in the courts of the Territory. The result then is that the 41 (1997) 191 CLR 471 at 527. Commonwealth properly pleaded that the relevant limitation regime is that found in the Territory statute. That result, in our view, is the correct outcome of the identification of the applicable law as required by s 80 of the Judiciary Act. The submissions for the Commonwealth may lead to the same outcome in the present litigation. However, that would not necessarily be so where the forum was a court of another Territory or of a State. Hence the necessity to distinguish between the two paths of reasoning. The proper law of the tort? In Pfeiffer the claims of the lex fori were deferred to those of the lex loci delicti. Here there is no "law area" to be found on the high seas which can provide the lex loci delicti. The question then becomes whether there is any other legal system which has a better claim than the forum which is to be treated by the forum as the body of law by which the action is to be decided. The phrase "body of law", in this context, identifies the statute law in force in some other State or Territory. This is because the issue removed into this Court has been limited to the liability of the Commonwealth in respect of certain negligent acts or omissions, and the Commonwealth can, in this case, be sued in the Supreme Court of any State or Territory or in any other court of competent jurisdiction in any State or Territory. The possibility of an external "body of law" being selected as the "proper law" may be discounted. Moreover, given the identity of the Commonwealth, the occasion for the curial operation of the proposed rule always would arise in a court identified in s 56 of the Judiciary Act and in the exercise of a particular head of federal jurisdiction and not otherwise. The reasoning in Pfeiffer considered the claims of what might be called the proper law of the tort. It is to that theory that the Commonwealth appeals, in substance, in its submissions in this case. However, of that theory, it was said in Pfeiffer42: "What emerges very clearly from the United States experience in those States where the proper law of the tort theory has been adopted is that it has led to very great uncertainty. That can only increase the cost to parties, insurers and society at large." 42 (2000) 203 CLR 503 at 538 [79]. Of further significance for the present case is the additional observation43: "Moreover, it might be thought that, often enough, the search for the proper law of the tort has led, in the United States, to the application of the law of the forum simply because the plaintiff chose to institute the proceedings in that place." The Commonwealth urges in favour of its submissions the opportunity provided to "forum shopping" by allowing the applicable law to remain that of the forum. It refers to the differences between the different limitations statutes in force in the various States and Territories. Views may vary as to the evil of choice of law rules which, in the absence of a body of law operative at the locus delicti, permit plaintiffs to select the forum with the limitation regime most favourable to them. However, the present litigation concerns a limited category within the class of maritime torts. In argument the Solicitor-General of the Commonwealth sought to expand the possible content of that category of Commonwealth liability in respect of negligent conduct in the navigation of ships of the Royal Australian Navy on the high seas by reference to various examples. But these by their fanciful nature served only to emphasise the point just made respecting the limited nature of the category for which there is proposed a "proper law of the tort" supplemental to the common law choice of law rules. In addition, the proposed rule would place the Commonwealth in a position peculiar to itself. The relevant policy of the law is exemplified in the denial by s 75(iii) of the Constitution to the Commonwealth of any immunity in tort which it otherwise might have enjoyed. The policy also is reflected in the provisions of s 64 of the Judiciary Act, which has stood without relevant amendment since 1903. Section 64 states: "In any suit to which the Commonwealth or a State is a party, the rights of parties shall as nearly as possible be the same, and judgment may be given and costs awarded on either side, as in a suit between subject and subject." One strand of the reasoning in British American Tobacco Australia Ltd v Western Australia44 concerned s 64. Importance was attached to the consideration that s 64 was designed, within certain limits, to place the Commonwealth and other 43 (2000) 203 CLR 503 at 538 [78]. 44 (2003) 77 ALJR 1566; 200 ALR 403. litigants upon the same footing, not to protect or advance any special position to be occupied by the Commonwealth. Further, the situation with which this case is concerned is but a further illustration of the consequences of the failure of the Commonwealth for more than a century to enact a limitation regime of comprehensive application to civil actions pursued in federal jurisdiction. The remedy, if there need be one, for long has lain in the hands of the Parliament itself. Conclusions For these reasons the preferred submission put by the Commonwealth should not be accepted. Rather, the applicable law is to be identified by proceeding directly through s 80 to the modification of the common law respecting limitation of actions which is effected by the relevant statute law of the Territory, namely the Limitation Act. The Limitation Act was enacted long after the events giving rise to Mr Blunden's cause of action. However, it applies to certain causes of action which accrued before, as well as after, the commencement of the statute. At the relevant time, Pt III (ss 30-42) was headed "Postponement of the Bar". Division 3.2 (ss 35-42) was headed "Personal injuries, latent damage to property and economic loss". The effect of ss 35 and 36(1) is that Div 3.2 applies in relation to actions for damages where the damages claimed consists of or includes damages in respect of personal injuries and the cause of action accrued before the commencement of the Limitation Act. These provisions in Div 3.2 qualify the general provisions for periods of limitation made in Pt II (ss 9-29). In particular, the six year limitation period specified in s 11 is, by s 9, subjected to the provisions of Pt III. At the relevant time, s 36 empowered the Supreme Court to order that the period within which an action may be brought is extended "for such period as it determines" (s 36(2)). This is not an occasion for this Court to enter upon the application of s 36(2) to Mr Blunden's action. An application by him under that provision was declined in the Supreme Court but an appeal to the Full Court of the Federal Court was allowed45. The Commonwealth applied to this Court for special leave to appeal. It was pointed out on the hearing of that application that the Full Court had made no orders consequential on its allowing the appeal. The application for special leave was stood over and the parties were invited to 45 Blunden v Commonwealth of Australia [2000] FCA 1581. approach the Full Court of the Federal Court to seek a complete disposition of the appeal to that Court46. Mr Blunden's counsel stated that the issue of extension of time remained unresolved. This was said to be because from the order of the Full Court it was not clear whether the Full Court was to be understood, in addition to allowing the appeal, to have itself gone on to grant leave under the Limitation Act or to have done no more than set aside the decision of the primary judge and send the matter back for further determination in the Supreme Court. These will be matters for attention on the further progress of Mr Blunden's action consequent upon the determination now provided of the issue respecting the applicable limitation law. Orders The questions in the Case Stated should be answered as follows: The plaintiff's action is subject to the provisions of the Limitation Act 1985 (ACT). (b) No. (c) Does not arise. It will be for a single Justice to remit to the Supreme Court that part of the cause removed into this Court and for the Supreme Court to give effect to the answers provided to the Case Stated. The costs of the Case Stated should be the costs of the cause in this Court. It will be for the Justice making the order for remitter to the Supreme Court to deal with that question of costs in this Court. 46 The Commonwealth v Blunden, unreported, 12 October 2001. Kirby KIRBY J. This is a Case Stated47 in which questions have been reserved for the Full Court in respect of part of a cause removed into this Court from the Supreme Court of the Australian Capital Territory ("the Supreme Court"). The questions concern whether proceedings brought in that Court by Mr Barry Blunden ("the plaintiff") against the Commonwealth of Australia ("the Commonwealth") are subject to a defence based on a statute of limitations. The submissions on the Case Stated oblige this Court to consider an issue arising in relation to the choice of law rules that are to be applied by Australian courts in respect of proceedings that have an arguable connection with more than one Australian jurisdiction and which arise out of an event occurring in international waters, on the high seas. In John Pfeiffer Pty Ltd v Rogerson48 this Court, in relation to an intra- national tort connected to more than one Australian jurisdiction, decided that questions of substantive law were governed by the law of the place of the wrong within Australia (the lex loci delicti)49. In Regie Nationale des Usines Renault SA v Zhang50, in respect of an inter-national tort involving acts or omissions that occurred outside Australia, sued for in an Australian court, the Court concluded that the same rule applied. The law governing the determination of the rights of the plaintiff and the liability of a defendant in such a case was that of the law of the place of the wrong51. Now, a new problem has presented. It concerns the law to be applied in respect of a tort that occurs on the "high seas", that is, beyond the geographical territory of Australia and beyond any internal waters or any waters which Australian law treats as territorial waters. Specifically, it concerns the substantive law to be applied in determining the liability of the Commonwealth for negligent acts and omissions alleged to have occurred in the control and operation of a naval vessel belonging to the Commonwealth, HMAS Voyager, when it collided with another such vessel, HMAS Melbourne, allegedly causing injuries and damage to the plaintiff. 47 By order of Gummow J dated 1 May 2003. 48 (2000) 203 CLR 503. 49 (2000) 203 CLR 503 at 542-544 [97]-[100], 563 [161], 574 [193]. 50 (2002) 210 CLR 491 at 520 [75]-[76], 535 [123]. 51 Regie Nationale des Usines Renault SA v Zhang (2002) 210 CLR 491 at 520 [75], Kirby To recover damages in respect of the injuries and damage that he claims he sustained as a result of the collision, the plaintiff instituted an action in the Supreme Court. In its defence, pleaded in answer to that claim, the Commonwealth relied upon three statutes of limitations, expressed in the alternative. These were the Imperial Act that first so provided52, the Act of the Australian Capital Territory53 or the Act of the State of New South Wales54. The Commonwealth did not plead any alleged limitation principle of the common law. Specifically, it did not plead any principle of laches developed by the English courts of Admiralty which might have been received as part of the law of Australia in colonial times55. Neither Pfeiffer nor Zhang resolves the point in contest between the plaintiff and the Commonwealth. Unless the vessels of the Royal Australian Navy ("RAN") were to be regarded, by a legal fiction, as part of the territory of Australia, a kind of floating island of Australian jurisdiction (thereby constituting the tort for which the plaintiff sued an intra-Australian one in accordance with Pfeiffer), the issue presented identifies an apparent gap in the statement of principles contained in Pfeiffer and Zhang. It involves neither an intra- Australian tort nor a tort where the place of the alleged wrong was the jurisdiction of a nation state other than Australia and hence an inter-national tort. It falls to this Court to fill any such gap. To do so, the Court must consider in the normal way whether any valid and applicable written law provides the answer. No party suggested that any provision of, or inference from, the Constitution was relevant to the resolution of the question56. If no ordinary legislation is found to be relevant, the common law of Australia must be developed, by analogous reasoning extending the principles stated in Pfeiffer and Zhang. Ultimately, in our legal system, there is never a legal lacuna. Where the Constitution, statute law and previously expressed common law are silent, it remains for the courts, ultimately this Court, to state the applicable rule. 52 Limitation Act 1623 (21 Jac I c 16), s 3. 53 Limitation Act 1985 (ACT), s 11. 54 Limitation Act 1969 (NSW), ss 14, 63(1). 55 The Key City 81 US 653 at 660 (1871); The Kong Magnus [1891] P 223 at 228; The "Alletta" [1974] 1 Lloyd's Rep 40 at 44-46; cf Erlanger v New Sombrero Phosphate Company (1878) 3 App Cas 1218 at 1279. See also Moragne v States Marine Lines Inc 398 US 375 at 406 (1970). 56 John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 557 [140]; Juenger, "Tort Choice of Law in a Federal System", (1997) 19 Sydney Law Review 529 at 534- Kirby The facts and arguments of the parties The relevant facts are contained in the reasons of Gleeson CJ, Gummow, Hayne and Heydon JJ ("the joint reasons")57. The tort for which the plaintiff sued the Commonwealth occurred in 1964. The action which the plaintiff began to recover damages was not commenced until 1998. The action was thus brought more than 34 years after the alleged wrong. Stated generally, the purpose of limitation statutes is to relieve parties of vexation by other parties complaining of legal wrongs many years after those wrongs are alleged to have happened. Although in some circumstances courts of Chancery58 afforded relief against belated claims and courts of Admiralty sometimes gave analogous relief within their jurisdiction59, the common law did not develop a general principle to oblige the commencement of proceedings within a given time. It was to repair the perceived injustice of the common law in this respect that legislation was first enacted in England providing for the limitation of actions60. The Limitation Act 1623 imposed a time limit of six years on the bringing of personal actions, including in respect of actions on the case, of which the tort of negligence upon which the plaintiff sues is an example61. In this Court, the plaintiff endeavoured to show that, because of the peculiar place where the wrong to him had occurred (on the high seas), there was no applicable Australian statute law providing for the application to his action of 57 Joint reasons at [1]-[5]. 58 This occurred both under the doctrines of equity and by virtue of statute: eg Real Property Limitation Act 1833 (3 & 4 Will IV c 27), s 2; Civil Procedure Act 1833 (3 & 4 Will IV c 42), ss 2 and 3; Trustee Act 1888 (51 & 52 Vict c 59), s 8. Equity applied the Limitation Act 1623 (21 Jac I c 16) "by analogy": Knox v Gye (1872) LR 5 HL 656 at 674. See also Meagher et al, Equity Doctrines and Remedies, 4th ed (2002) at 1031 [36-005]. 59 The Key City 81 US 653 at 660 (1871); The Kong Magnus [1891] P 223 at 228; The "Alletta" [1974] 1 Lloyd's Rep 40 at 44-46; Moragne v States Marine Lines Inc 398 US 375 at 406 (1970). 60 In its terms, the Limitation Act 1623 (21 Jac I c 16) (with subsequent modifications) applied to nominated proceedings and before 1833 did not, either in the United Kingdom or any part of Australia, explicitly bar a suit in equity. See Meagher et al, Equity Doctrines and Remedies, 4th ed (2002) at 1009 [34-005]- 61 21 Jac I c 16, s 3. Kirby a limitation period. From this, the plaintiff's argument proceeded that, in effect, the original common law applied to his claim in tort unmodified by any limitation statute. There was thus no limitation period applicable to the commencement of his action. Whilst this might seem anomalous, it was simply a consequence of the unique place of the wrong in his case. The plaintiff submitted that the Federal Parliament could have enacted a general statute of limitations which, subject to the Constitution62, restricted the time within which a person, such as the plaintiff, could sue the Commonwealth in respect of alleged acts or omissions of negligence for which the Commonwealth was otherwise liable. Alternatively, subject to the Constitution, the Federal Parliament could have enacted a special limitation period applicable to actions of tort brought against the Commonwealth by defence force personnel or in respect of negligence occurring on the high seas on a vessel of the RAN such as HMAS Melbourne or HMAS Voyager. It had done none of these things. The foregoing omissions were, it was suggested, more significant when the position arising out of the collision relevant to the plaintiff's case was contrasted with cases of maritime collisions expressly provided for by federal law, notably a collision between ships of different ownership63. In this connection, it is also relevant to notice the Crimes at Sea Act 2000 (Cth)64. By that Act it is provided (s 6(1)) that the substantive criminal law of a nominated Australian territory (the Jervis Bay Territory65) applies to, and in relation to, Australian ships, as if the act in question had been committed in a State or Territory of Australia. Provision is also made for the application of Australian criminal laws to Australian citizens travelling on foreign ships in certain circumstances (s 6(2)). The Act recognises the controlling force of "jurisdiction … recognised under principles of international law" (s 6(5) and (9)). Although such provisions have no applicability to the present case, concerned as it is with the law of tort, they demonstrate the fact that, where there is a will, the Federal Parliament can enact specific laws governing the consequences under Australian 62 eg Constitution, s 75(iii). See The Commonwealth v Mewett (1997) 191 CLR 471. 63 Navigation Act 1912 (Cth), ss 260, 261. The Act governs shipowners' liability for loss of life or personal injury, providing that it is to be joint and several. It does not withdraw defences arising independently of s 260. 64 The Crimes at Sea Act 2000 (Cth) was preceded by the Crimes at Sea Act 1979 (Cth), relevantly in like terms. 65 Under the Jervis Bay Territory Acceptance Act 1915 (Cth), s 4A, the laws in force in the Australian Capital Territory are, so far as applicable, in force in the Jervis Bay Territory. Kirby municipal law of events having an Australian connection although actually occurring on the high seas, that is, in international waters. The foregoing statutory provisions had no application to the plaintiff's case. There was no general or particular federal legislation directed (as it might have been) to the consequences, including for the limitation of actions, against the Commonwealth of torts happening on the high seas involving naval vessels of the Commonwealth and arising out of collisions between such vessels. For more than a century, for a reason that is elusive, the Federal Parliament has failed to enact a limitation statute applicable to federal proceedings66. It has relied upon the applicable law (if any) of the relevant State or Territory as a kind of surrogate law67. Perhaps the task of drawing such a statute has been regarded as too difficult. Perhaps it has been overtaken by other, more urgent, priorities. Perhaps the Commonwealth has found the current arrangements satisfactory. The Commonwealth's primary submission was that the correct approach to the ascertainment of a limitations period applicable to the plaintiff's action involved the acceptance, and extension, of the fundamental principle endorsed by this Court in both Pfeiffer and Zhang. For a cause of action arising on the high seas involving ships flying the flag of Australia, this meant, so it was argued, the identification of the jurisdiction within Australia with which the events, giving rise to the alleged wrong, had the "closest connection". The Commonwealth submitted that this was the way by which the substantive law applicable to such a case would be discovered (including any applicable statute of limitations). It would produce a solution to the present case that most closely conformed to the approach adopted by this Court in Pfeiffer and Zhang. In short, if the law applicable to an action of negligence brought in an Australian court, with jurisdiction to decide it, for intra-Australian and non- Australian torts, was the law of the place of the wrong, some adaptation was necessary where the place of the wrong was the high seas, having no applicable limitations law as such. To find the applicable law, analogous reasoning would point the court to the Australian jurisdiction with the "closest connection" to the relevant facts. The difficulties that might follow in respect of wrongs allegedly arising out of the control and conduct of vessels flying a foreign flag (or in respect of a collision between naval and civilian vessels or naval vessels of different flags) did not arise in this case. It was clear that an Australian court must apply Australian law. But in choosing between the applicable laws of the 66 The Commonwealth v Mewett (1997) 191 CLR 471 at 552. 67 Under the Judiciary Act 1903 (Cth), ss 79, 80. Kirby several Australian jurisdictions, the one to be applied was not that of the forum chosen by the plaintiff. It was the law of the jurisdiction within Australia having the "closest connection" with the alleged wrong. The Commonwealth submitted that, as the wrong alleged by the plaintiff had involved the control and direction of an Australian naval vessel, the appropriate search was for the relevant Australian jurisdiction having the closest connection to the control and direction of that vessel at the time of the alleged wrong. According to the Commonwealth68, this was either the Australian Capital Territory (as the principal seat of the administration and operations of the RAN), or New South Wales (as the Australian State with the last port of the vessel on the journey on which the plaintiff was injured)69. The Imperial Act, although nominated in the Commonwealth's defence, was not supported by any viable argument. The context of international law The high seas are not a law-free zone. They are subject to international law, expressed both in treaties to which Australia is a party70 and in customary international law71. In discovering Australia's municipal law on the subject before the Court in these proceedings, it is appropriate to begin the task (and to resolve any uncertainties), so far as possible, in accordance with the principles of the international law applicable to the high seas. It was not submitted by any party or intervener that international law provided a clear principle to resolve the search for the rule of municipal law to be applied to decide the dispute between the plaintiff and the Commonwealth on the limitations issue in the Case Stated. Of its nature, it is unlikely that international law would concern itself in the civil liability of a nation state to an employee of the Executive Government of that state claiming damages in respect of injuries which, although suffered on the high seas, allegedly arose as a consequence of 68 See also joint reasons at [36]-[37] where the alternative submissions are set out. 69 Applying The Commonwealth v Mewett (1997) 191 CLR 471 at 527 per Gaudron J. 70 Convention on the High Seas done at Geneva on 29 April 1958, 1963 Australia Treaty Series 12 (entered into force for Australia on 13 June 1963), the "high seas" being all parts of the sea not included in the territorial sea or internal waters of a state. See also United Nations Convention on the Law of the Sea done at Montego Bay on 10 December 1982, 1994 Australia Treaty Series 31 (entered into force for Australia on 16 November 1994), which defines the "high seas" differently but in respects immaterial to this discussion. 71 Commonwealth v Yarmirr (2001) 208 CLR 1 at 121-126 [272]-[282]. Kirby negligence solely attributable to the control and direction of a naval vessel or vessels flying the flag of that state. In so far as there is an applicable principle of public international law, it is that extra-territorial acts may only be rendered subject to the exercise of jurisdiction by national courts applying domestic law if certain rules are observed. One of these rules is that there must be a substantial and bona fide connection between the subject matter and the source of the jurisdiction relied upon72. "[C]ourts ordinarily confine the assertion and exercise of their jurisdiction to matters arising in relation to the territory over which the polity that has established the court enjoys legal authority. The principle of public international law requiring a substantial and bona fide connection between the subject matter and the source of jurisdiction74 affords a reason for restraint in the exercise of judicial power beyond that territory. That reason is ultimately based upon notions of comity, reciprocity, and mutual respect between different legal jurisdictions. Those considerations tend to advance the just and efficient administration of the law and the avoidance of conflict caused by excessive assertions of jurisdiction." The rule of international law that "a State may not exercise its authority on the territory of another State" gives effect to the "principle of sovereign equality among all Members of the United Nations, as laid down in Article 2, paragraph 1, of the Charter of the United Nations"75. It is for this reason that, notwithstanding the possible establishment of jurisdiction, in the sense of power over a defendant which is liable to be sued, an Australian court might, in a given case, in circumstances different from the present, refrain from exercising that jurisdiction in respect of a wrong allegedly occurring on the high seas. For example, if the wrong occurred on the high seas in conditions of armed conflict, hostilities between nations or collisions between vessels flying different flags, forum and questions of justiciability, sovereign immunity, convenient 72 Brownlie, Principles of Public International Law, 5th ed (1998) at 313. See Regie Nationale des Usines Renault SA v Zhang (2002) 210 CLR 491 at 527 [102]. 73 (2002) 210 CLR 491 at 528 [105]. 74 Compania Naviera Vascongado v SS Cristina [1938] AC 485 at 496-497; Tolofson v Jensen [1994] 3 SCR 1022 at 1047. 75 Democratic Republic of the Congo v Belgium [2002] ICJ 1 at [1]; 41 ILM 536 at Kirby ascertainment of any applicable law could arise. Such questions would be resolved by an Australian court with due regard to the principle of international law that ordinarily restricts the exercise of the authority of municipal courts to their own geographical territory, to any internal or proximate territorial waters and to events or things having relevant connections with the state concerned. In the present case no such difficulties arise. The Commonwealth is present everywhere in the Australian nation. It is thus present in the Australian Capital Territory, where the plaintiff has brought his action. Its liability to the plaintiff in respect of the control and direction of naval vessels flying the Australian flag is clearly, and probably only, an Australian legal question, susceptible, in the event of dispute, to resolution by an Australian court. No rule of public international law provides, or suggests the need for, an exception, modification or adaptation of Australian law as applicable to the Commonwealth for the negligence for which it is alleged to be liable to the plaintiff. Some of the arguments before this Court proceeded as if there were no relevant context of public international law. In the end, that was a correct conclusion because of the substantial and bona fide connection between the subject matter of the plaintiff's action and the source of the Australian jurisdictions relied upon. However, given the place of the wrong alleged by the plaintiff, it is important that this first step in reasoning should be taken. In other circumstances, that step could control, or certainly affect, the ascertainment of the rule applicable in an Australian court otherwise having jurisdiction over the parties. In this case, for Australian law and an Australian court to apply its domestic prescriptions to events happening on the high seas, either by applying the provisions of a statute or a principle of the common law of Australia, would offend no rule of public international law. Finding the applicable law: the "closest connection" principle It is therefore necessary to decide what the applicable Australian law is and whether any statute of limitations received into Australian law from English law, any enacted Australian statute or any principle of the common law applies to the plaintiff's action to present a time bar. The facts in the Case Stated make it clear that, as national naval vessels of Australia, neither HMAS Melbourne nor HMAS Voyager was registered in any port or had a home port as such. For electoral purposes, the City of Melbourne was taken to be the home port of members of the crew on both ships but only where such crew members did not have a bona fide place of living onshore. Shortly before the subject collision, HMAS Melbourne sailed from Sydney and anchored in naval waters in New South Wales. It did so before setting out for the rendezvous with HMAS Voyager. The nearest landfall was the Jervis Bay Territory. HMAS Voyager left Sydney and anchored in Jervis Bay before sailing for the naval exercise area where the collision occurred at 8.56 pm on Kirby 10 February 1964. The impact happened on the high seas some 18.4 nautical miles from Cape St George. That cape is part of Jervis Bay Territory but the foreshore near the Cape, between low and high water, is part of the State of New South Wales. Under the Naval Defence Act 1910 (Cth) and Naval Forces Regulations made under that Act, the RAN was controlled and administered in 1964 by the Naval Board. That body was located in the Australian Capital Territory. It was accountable to the Minister for the Navy or the Minister of whatever designation having equivalent responsibility. At the time of the collision, the flag officer commanding the naval exercise in which the plaintiff was injured was physically present in Canberra, in the Australian Capital Territory. Although he had departed HMAS Melbourne on the day prior to the collision, he retained operational control of the Australian fleet and, specifically, of the naval exercise in which the two vessels were engaged. Those vessels had departed Australian territorial waters on the morning of the collision. They were scheduled to return to those waters that evening. The foregoing were the facts upon which the Commonwealth relied for its assertion that the law of the place of the wrong applicable to the plaintiff's action was either the Australian Capital Territory (as the Australian jurisdiction having the "closest connection" with the wrong) or New South Wales (as the Australian jurisdiction from whose waters the two vessels had departed and to which they were to return). In the Commonwealth's submission, this represented the accurate application of this Court's insistence in Pfeiffer and Zhang upon the operation of the law of the place of the wrong both to intra-national torts and torts having an inter-national character, with a connection with some other national jurisdiction. The present is not the first case in which a question concerning the applicable law has arisen in respect of an alleged maritime tort happening on the high seas. Where a tort is committed in international waters and only one ship is involved, the traditional approach of the English common law, in respect of actions brought in an English court, has been to apply the choice of law rules for a foreign tort as explained in Phillips v Eyre76. Where, however, the flag of that ship is a federal state, the relevant law area has conventionally been regarded as that of the place where the ship is registered77. Where a tort is committed on the 76 (1870) LR 6 QB 1 at 28-30. 77 Collins (ed), Dicey and Morris on The Conflict of Laws, 13th ed (2000) vol 2 at 1537. See also North and Fawcett (eds), Cheshire and North's Private International Law, 13th ed (1999) at 663 citing Canadian National Steamships Co v Watson [1939] 1 DLR 273. Kirby high seas, involving another ship (as in the case of collision between two ships of different flags or a common foreign flag) English courts have applied English law for the determination of such maritime disputes78. Having regard to the decisions of this Court79 overruling in other contexts the approach taken in Phillips v Eyre, it would be anomalous to return to that principle for the solution of the present problem. The approach of the English courts does not determine the common law of Australia. Still less does English law have anything to say to the application of Australian legislation to a case before an Australian court. Least of all can English law govern the way in which an Australian court must exercise federal jurisdiction, which is enlivened in this case by the identity of the defendant sued by the plaintiff, namely the Commonwealth80. These considerations led the Commonwealth to urge a distinct Australian approach to the ascertainment of the law of the place of the wrong in the present circumstances. Because neither HMAS Melbourne nor HMAS Voyager had a port of registration or home port as such, the Commonwealth argued that the federal puzzle in the case should be resolved by determining the Australian jurisdiction with which the wrong had the "closest connection". This, in the Commonwealth's primary submission, was the Australian Capital Territory, as the seat of the Naval Board81 and the place of ultimate control and direction of the manoeuvres82 and the location of those with the ultimate capacity to control and direct the operation of the vessels for whose acts and omissions the Commonwealth was vicariously liable. Alternatively, it was New South Wales, being the place of the last port of call of the two ships; their expected port of destination at the end of the manoeuvres; the place most proximate to their last anchorage points; and the place in Australia with closest proximity to the point of collision. 78 See Collins (ed), Dicey and Morris on The Conflict of Laws, 13th ed (2000) vol 2 at 1539-1540; North and Fawcett (eds), Cheshire and North's Private International Law, 13th ed (1999) at 663-664. 79 John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503; Regie Nationale des Usines Renault SA v Zhang (2002) 210 CLR 491. 80 Constitution, s 75(iii). 81 cf The Admiralty v Owners of the Steamship Divina (The Truculent) [1952] P 1; Western Australia v Watson [1990] WAR 248 at 270. 82 cf Burk v The Commonwealth [2002] VSC 453 at [2]. Kirby The fundamental objection of the Commonwealth to the adoption of any other approach to the ascertainment of the law of the place of the wrong was that, effectively, it surrendered the determination of that place to the election of a plaintiff. It did so by reference to the plaintiff's conduct in commencing proceedings in a court of a particular Australian jurisdiction. Because it was suggested a plaintiff should not enjoy the privilege to determine, or influence, in any way, the substantive law applicable to the resolution of his or her claim, it was argued that the applicable law existed prior to, and independently of, the plaintiff's selection of the venue of the proceedings. It existed by operation of law. In the present case, because the wrong had not occurred within the geographical boundaries either of an Australian jurisdiction or a foreign jurisdiction, a new rule was necessary. The "closest connection" principle was therefore propounded as the best available rule to fulfil that need. I have explained this argument in some detail because it has obvious logical attractions. Finding the applicable law: federal legislation Rules of the common law are stated by judges to apply in the spaces left by the operation of the written law, whether expressed in the Constitution or in, or under, valid legislation. Where statute law applies and is constitutionally valid, it is the first duty of courts in a municipal legal system to give them effect83. In the case of ambiguity, the requirements of statute law may sometimes be adapted to conform so far as possible to the international obligations of the state84, as for example to comply in that way with any applicable principles of international human rights law85. Moreover, there is an inevitable interaction between the provisions of statute law and the decisions of judge-made law86, just as equity also developed its approach to the law of limitations by analogy with 83 Regie Nationale des Usines Renault SA v Zhang (2002) 210 CLR 491 at 543-544 84 Chu Kheng Lim v Minister for Immigration (1992) 176 CLR 1 at 38; Pearce and Geddes, Statutory Interpretation in Australia, 5th ed (2001) at 57-58 [3.8]; cf The Paquete Habana 175 US 677 at 700 (1900). 85 Mabo v Queensland [No 2] (1992) 175 CLR 1 at 42; Kartinyeri v Commonwealth (1998) 195 CLR 337 at 417-418 [166]; Re Minister for Immigration and Multicultural Affairs; Ex parte Epeabaka (2001) 206 CLR 128 at 151-152 [69]; Plaintiff S157/2002 v Commonwealth (2003) 77 ALJR 454 at 462 [30]; 195 ALR 24 at 34; Attorney-General (WA) v Marquet (2003) 202 ALR 233 at 277 [180]. 86 Gray v Motor Accident Commission (1998) 196 CLR 1 at 25-27 [80]-[83], 46-47 Kirby the statutes of limitations87. However, in an Australian court whose jurisdiction is validly invoked, the primary step is to ascertain the requirements of any applicable statute law. If such law exists, is valid, relevant, clear and applicable, it must be applied in conformity with the requirements of the Constitution88. It cannot be ignored. Nor can it be overridden by any suggested choice of law doctrine of the common law. The plaintiff, having commenced proceedings in the Supreme Court of the Australian Capital Territory, invoked the jurisdiction of a court within the Australian Judicature89. The first question to be decided is, therefore, whether that Court has jurisdiction over the matter. As this Court has repeatedly emphasised, that question is distinct, and separate from, the question of the applicable law. Jurisdiction concerns the amenability of the parties to a court's orders and a court's competence in respect of a claim90. Because here the Commonwealth is a party, present everywhere throughout the nation, the jurisdictional requirement was clearly fulfilled in the plaintiff's proceedings. Nor was there any suggestion that the proceedings should be stayed or dismissed on the ground that the forum was inconvenient91. No one argued that this was a case where the claim was procedurally unenforceable, as might have been the case had a specific federal law confined claims such as the plaintiff's to a specialised tribunal or particular procedures92. Clearly, it was established that the Supreme Court had jurisdiction. But this left to be ascertained the law that would govern any rights that the plaintiff had against the Commonwealth, and specifically, whether the applicable law included any statute of limitations and, if so, its terms. The Commonwealth of Australia is created by the Constitution. As such, it is only liable to be sued in accordance with any relevant constitutional 87 Meagher et al, Equity Doctrines and Remedies, 4th ed (2002) at 1015-1016 88 Constitution, covering cl 5. 89 Re Governor, Goulburn Correctional Centre; Ex parte Eastman (1999) 200 CLR 90 John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 562 [154]. 91 John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 562 [154]; cf Regie Nationale des Usines Renault SA v Zhang (2002) 210 CLR 491 at 545-551 [152]- 92 John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 548-549 [116]. Kirby prescription or any liability validly imposed by other law. Without such a legal entitlement to sue, the plaintiff could not sue the Commonwealth for the wrong allegedly done to him in 1964, as if the Commonwealth were amenable to a common law claim as a natural person might be. By making the Commonwealth a party to his action, the plaintiff invoked the exercise of federal jurisdiction by the Supreme Court93. Within that jurisdiction, the Commonwealth was not liable, as such, to the written law of a territory (such as the Australian Capital Territory). To render such law applicable to the Commonwealth, it was necessary for that consequence to be imposed on it by a law duly enacted by the only legislature to which the Commonwealth is amenable, namely by or under federal legislation94. To make good his claim against the Commonwealth, therefore, the plaintiff needed such a federal law. He could not pick and choose: taking the federal laws he liked and rejecting those he disliked. He was bound by the law applying to his action against the Commonwealth, both facultative and restrictive. The Commonwealth could not claim immunity from liability to the plaintiff in tort. To the extent that Crown or Executive immunity applies to the States provided for in the Constitution95, the Commonwealth is in a different position by reason of the provisions of s 75(iii) of the Constitution96. However, the amenability of the Commonwealth to the jurisdiction of an Australian court and the absence of immunity, only takes a person in the position of the plaintiff so far. To succeed in his claim, the plaintiff still needs a federal law that renders the Commonwealth liable to him for negligence. Just as he needed a federal law to render the written law applicable to the Commonwealth, the plaintiff must rely on federal legislation to attract the unwritten law, specifically that establishing the liability of the Commonwealth to him in tort97. 93 Northern Territory v GPAO (1999) 196 CLR 553 at 591 [91], 605 [132], 649 [248], 94 Solomons v District Court of New South Wales (2002) 211 CLR 119 at 136 [28], 147 [62], 151-152 [81]-[82]; R v Gee (2003) 77 ALJR 812 at 828 [100]; 196 ALR 95 A question referred to in British American Tobacco Australia Ltd v Western Australia (2003) 77 ALJR 1566 at 1592-1593 [138]-[144]; 200 ALR 403 at 438- 96 The Commonwealth v Mewett (1997) 191 CLR 471 at 545-552. 97 In federal jurisdiction, a court's power with respect to the unwritten law comes from federal legislation. Section 80 of the Judiciary Act 1903 (Cth) directs a court to apply the "common law in Australia" and it is by such means that the common (Footnote continues on next page) Kirby That law is found in the Judiciary Act 1903 (Cth), relevantly ss 79 and 8098. By s 80 the "common law in Australia as modified … by the statute law in force in the … Territory in which … the jurisdiction is exercised … shall … govern all Courts exercising federal jurisdiction … in civil … matters". It is by this means, and by s 64 of the same Act that, in the proceedings brought by the plaintiff, the Commonwealth is rendered liable to him as it otherwise would be in a suit between the plaintiff and a natural person. The common law, modified by the applicable statute in force in the Territory, applies to fill the gaps in the written law. I agree with the joint reasons that the opening words of s 80 of the Judiciary Act refer only to statute law99. They do not refer to the common law absent limitation statutes. The result of this conclusion is that, because there is no relevant provision in the Constitution or federal statute law inconsistent with this consequence, the laws (relevantly) of the Australian Capital Territory are binding on a court "exercising federal jurisdiction" in that Territory. The only condition is that the case must be one to which such laws are "applicable". On what footing could it be said that the Limitation Act 1985 ("the Act") of the Australian Capital Territory, as part of the "statute law in force in the … Territory in which … the jurisdiction is exercised", is not "applicable" to the case brought by the plaintiff? Three propositions need to be considered. First, it cannot be said that the Act is not "applicable" by reason of the fact that the cause of action arose outside the Australian Capital Territory. In its terms, the Act is addressed to proceedings commenced in a Territory court. Indeed, although the Act was enacted after the plaintiff's cause of action arose, I agree with the joint reasons that its effect100 is that it applies to actions of the kind brought by the plaintiff, whenever the events out of which it arose occurred101. On the face of things, therefore, and by its terms, the Act attaches to the law may be applied to render the Commonwealth liable in tort: Commonwealth v Mewett (1997) 191 CLR 471 at 522, 525-526, 554. The 98 The sections are set out in the joint reasons at [16]-[17]. 99 Joint reasons at [28]-[29] applying The Commonwealth v Colonial Combing, Spinning and Weaving Co Ltd (1922) 31 CLR 421 at 431. 100 The Act, ss 35, 36. 101 Joint reasons at [46]. Kirby plaintiff's action. In this sense, it is "applicable" to his case in federal jurisdiction102. Secondly, the Act is not inapplicable because limitation laws are classified as being of a procedural character. In Australia, statutes of limitations are no longer treated as "procedural" laws; they are "substantive" laws103. As well, by legislation in common form throughout Australia, such statutes have been declared to be "part of that substantive law [to be] applied accordingly by the court"104. I pass by the fact that this statutory alteration itself occurred after the plaintiff's claim accrued. I will assume that, by its terms, the legislation applies in this respect to the action brought by the plaintiff. However, there remains a potential problem in this statutory realignment of the character of statutes of limitations. The legislation so providing is conditioned in its operation upon the existence of specified circumstances. It applies only105: "If the substantive law of another place being a State, another Territory or New Zealand, is to govern a claim before a court of the Territory". According to the argument of the plaintiff, the substantive law applicable to his case was, and was only, that of the place of the wrong. It was therefore the law applicable with respect to the Australian vessels on the high seas. It was not the substantive law of "another place" within the geographical area of Australia (or New Zealand) as defined. It was on this basis that the plaintiff argued that no statute of limitations was picked up and applied to his action as a surrogate law made applicable in federal jurisdiction106. The flaw in this argument is that it overlooks the language of s 80 of the Judiciary Act. It is that section that renders the common law in Australia applicable to the Supreme Court in its exercise of federal jurisdiction in the plaintiff's case against the Commonwealth107. That application comes at a price. 102 Judiciary Act 1903 (Cth), ss 79 and 80. 103 John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 542-544 [97]-[100], 563 [161], 574 [193]. See joint reasons at [6]. 104 The Act, s 56. There are like provisions in the limitation laws of other Australian jurisdictions. See joint reasons at [7]-[8]. 105 The Act, s 56. The provision is set out in the joint reasons at [6]. 106 The expression "surrogate law" appears to be derived from Maguire v Simpson (1977) 139 CLR 362 at 408 per Murphy J: see Solomons v District Court of New South Wales (2000) 49 NSWLR 321 at 324 [10]. 107 The Commonwealth v Mewett (1997) 191 CLR 471 at 522, 525-526, 554. Kirby The common law applicable is that "as modified … by the statute law in force in the … Territory in which the Court in which the jurisdiction is exercised is held". The selfsame provision that the plaintiff needs to render the Commonwealth liable to him at common law imports the "modification" of its terms by the Act. By such provision, that statute is given effect to govern the Supreme Court exercising federal jurisdiction in the plaintiff's civil matter. The plaintiff cannot accept the provisions of s 80 of the Judiciary Act, rendering the common law applicable to his claim against the Commonwealth, but reject the "modification" enacted by the same provision, subjecting that common law claim to the limitations statute of the Australian Capital Territory. By the terms of s 80, the two go together. Thirdly, it could be argued that the Act is inapplicable because the only law "applicable" to the plaintiff's claim is, in accordance with Pfeiffer and Zhang, that of the place of the wrong, that is, the high seas, where there was no applicable limitations law. However, this is just another way of expressing the second argument. It is subject to the same defect. To the extent that the plaintiff, in suing the Commonwealth, needs s 80 of the Judiciary Act to provide the applicable substantive common law, he attracts the benefits and burdens of that section. He thereby renders the Commonwealth liable to the common law of Australia. However, it is only such common law "as modified … by the statute law in force in the … Territory". And that includes the Act with its applicable limitation requirements. Conclusion: the limitations law of the Territory applies The foregoing result is unsurprising in a case having no relevant non- Australian legal features. It conforms to the constitutional postulate that denies the operation of any immunity of the Commonwealth, with the effect that liability may attach to the Commonwealth at common law108. It also conforms to the principle in the Judiciary Act subsuming such liability on the part of the Commonwealth to a position analogous to that of a natural person sued in equivalent proceedings109. In such proceedings a natural person could invoke the applicable statute of limitations. By the terms of federal law, so can the Commonwealth when sued in an Australian court exercising federal jurisdiction. 108 Constitution, s 75(iii). See The Commonwealth v Mewett (1997) 191 CLR 471 at 491, 531, 545-552; cf Mutual Pools & Staff Pty Ltd v The Commonwealth (1994) 179 CLR 155 at 217; Castles, "The elusive common law and Section 80 of the Judiciary Act 1903 (Cth)", (1989) 63 Australian Law Journal 490 at 492; Selway, "The Source and Nature of the Liability in Tort of Australian Governments", (2002) 10 Tort Law Review 14 at 26. 109 Judiciary Act 1903 (Cth), s 64. Kirby If this renders the Commonwealth liable to the limitations law of the Australian jurisdiction in which the plaintiff commences the proceedings, it is simply a Kirby consequence of the federal statute applicable to the case110. The Federal Parliament might have applied uniformly a more objective approach, indifferent to the venue of the proceedings chosen by the plaintiff. So far it has not done so. This reasoning makes it unnecessary to resolve the arguments advanced for the Commonwealth concerning the identification of the law of the place of the wrong having the "closest connection" with the wrong for which the plaintiff sues. Such an issue might need to be resolved in a claim arising out of events on the high seas involving different parties, having factual connections with several jurisdictions, in and out of Australia111. In some circumstances, it might be debatable as to precisely where an alleged "wrong" occurred112. That factual problem is not presented in the present case. Nor is there a competition here between an Australian jurisdiction and a foreign jurisdiction, such as arose in Zhang. There is no principle of public international law that restrains, or suggests modification of, the application to the case of the statute law enacted by the Federal Parliament. The plaintiff, having validly invoked an available Australian jurisdiction, attracted to the determination of the applicable law federal legislation that decides the contested point concerning the limitations law relevant to this case. In an Australian court no principle of the common law concerning choice of law could override such a statutory prescription. The statute must be given effect. It requires the application to the plaintiff's action of the Limitation Act of the Australian Capital Territory. This is so because that Act modifies the common law in the Territory in terms that are applicable to the case. It therefore has effect on the rights and obligations of the parties by force of the federal statute picking up and applying the Australian Capital Territory Act. Orders I agree in the disposition of the Commonwealth's application for special leave as explained in the joint reasons113. The questions in the Case Stated should be answered in the terms proposed in the joint reasons. The orders proposed there should be made. 110 Kirk, "Conflicts and Choice of Law within the Australian Constitutional Context", (2003) 31 Federal Law Review 247 at 273. 111 John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 561 [150.10]. 112 Regie Nationale des Usines Renault SA v Zhang (2002) 210 CLR 491 at 539 [133]. 113 Joint reasons at [47]-[49]. Callinan CALLINAN J. Next to waging war, preparing for it, by training in conditions simulating it, is one of the most dangerous activities that humankind can undertake. Accidents are bound to happen, and because they do, it is to be hoped that the nation will make generous provision, by way of pensions, medical treatment and otherwise, for those service people who fall victim to them. It was in the course of such a training exercise that two warships of the Royal Australian Navy came into collision on the high seas some 18 or so miles off the Australian coast on 10 February 1964. The plaintiff who was a seaman on one of the ships claims to have suffered personal injuries as a result of the collision. He has sued the defendant for damages in the Supreme Court of the Australian Capital Territory. No question arises at this stage as to the application and binding force of the reasons and decision of this Court in Groves v The Commonwealth114 in which the narrow question, whether an injured serviceman who was engaged in assisting in the carriage on an air force aeroplane of civilian passengers when he suffered injuries as a result of an act of negligence unrelated to hostilities or training for them, could maintain an action against the Commonwealth, was answered affirmatively. The only question which does arise, again a relatively narrow one, is: "what, if any, limitation law applies to the plaintiff's claim for damages, in so far as it relates to any negligent acts or omissions by servants or agents of the Commonwealth in international waters". In the circumstances of this unique case, three possible answers to the question were canvassed in argument: by the plaintiff, that no limitation law applied; and, by the defendant, either the limitation laws of New South Wales being the law area in Australia closest to the place of the tort, the negligently caused collision; or, the limitation laws of the forum selected by the plaintiff, the Australian Capital Territory. As is pointed out in the joint judgment, if the substantive law of New South Wales were the law applicable to the case, s 56 of the Limitation Act 1985 (ACT) would have the effect of applying the limitation law of that State to the plaintiff's action. And because the plaintiff's claim did not arise in a State or Territory of the Commonwealth s 56 of the Judiciary Act 1903 (Cth) enabled the 114 (1982) 150 CLR 113. Feres v United States (1950) 340 US 135 is not cited in Groves. It appears to reject categorically any liability, whether in peacetime or otherwise, in respect of injuries sustained by service people in carrying out any of their duties. See also Keeton et al, Prosser and Keeton on the Law of Torts, 5th ed Callinan plaintiff to sue in any Supreme Court of the country, including the Supreme Court of the Australian Capital Territory. I agree, for the reasons set out in the joint judgment, that neither the Admiralty Act 1988 (Cth) nor the Navigation Act 1912 (Cth) applies to this case. I agree with their Honours' construction of s 80 of the Judiciary Act and that115: "the provisions of the federal statute law, s 80 itself apart, would be insufficient to provide [the plaintiff] with any adequate remedies." Further, in view of the Commonwealth's abstention from enacting a limitations act of general and detailed application to suits against it, complaints of forum shopping, as undesirable in my opinion as that may be, have somewhat of a hollow ring to them. I agree with the joint judgment that there is no other legal system having a better claim than the Australian Capital Territory, the law of which is to be treated as the body of law by which the plaintiff's action is to be decided. Their Honours' conclusion, that the applicable law is to be identified by reference to s 80 of the Judiciary Act, which has the effect of modifying any common law respecting limitation of actions, by applying to it, the relevant statute law of the Australian Capital Territory which includes the Limitation Act, is in my respectful opinion the correct one. Its effect is fully stated in the joint judgment. I agree with the answers which their Honours give to the questions in the Case Stated and to the orders that they propose. 115 Judgment of Gleeson CJ, Gummow, Hayne and Heydon JJ at [35].

HIGH COURT OF AUSTRALIA DQU16 & ORS AND APPELLANTS MINISTER FOR HOME AFFAIRS & ANOR RESPONDENTS DQU16 v Minister for Home Affairs [2021] HCA 10 Date of Hearing: 4 February 2021 Date of Judgment: 7 April 2021 ORDER Appeal dismissed with costs. On appeal from the Federal Court of Australia Representation C A Webster SC with I J King and E C Graham for the appellants (instructed A M Mitchelmore SC with G J Johnson for the first respondent (instructed by Australian Government Solicitor) Submitting appearance for the second respondent Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS DQU16 v Minister for Home Affairs Immigration – Visas – Application for protection visa – Where s 36(2) of Migration Act 1958 (Cth) provides two criteria for grant of protection visa – Where s 36(2)(a) provides refugee criterion – Where s 36(2)(aa) provides complementary protection criterion – Where Court in Appellant S395/2002 v Minister for Immigration and Multicultural Affairs (2003) 216 CLR 473 ("Appellant S395") held asylum seeker cannot be expected to hide or change behaviour manifesting protected characteristic under Refugees Convention for purposes of assessing claim under s 36(2)(a) – Where s 36(2)(aa) requires assessment of whether "significant harm" a "necessary and foreseeable consequence" of applicant's return to receiving country − Where first appellant applied for protection visa under both ss 36(2)(a) and 36(2)(aa) – Where Immigration Assessment Authority found first appellant would modify behaviour on return to Iraq − Whether failure to consider principle in Appellant S395 under s 36(2)(aa) constituted jurisdictional error. Words and phrases – "absolute and non-derogable", "complementary protection", "Convention Against Torture", "cruel, inhuman or degrading treatment or punishment", "innate or immutable characteristics", "International Covenant on Civil and Political Rights", "manifestation of a Convention characteristic", "membership of a particular social group", "modification of behaviour", "necessary and foreseeable consequence", "non-refoulement obligations", "real chance", "real risk", "refugee", "Refugees Convention", "sale of alcohol", "significant harm", "well-founded fear of persecution". Migration Act 1958 (Cth), ss 5H, 5J, 36(2)(a), 36(2)(aa). KIEFEL CJ, KEANE, GORDON, EDELMAN AND STEWARD JJ. Section 36(2) of the Migration Act 1958 (Cth) relevantly provides two criteria for the grant of a protection visa: that the applicant is a non-citizen in Australia "in respect of whom the Minister is satisfied Australia has protection obligations because the person is a refugee" under s 36(2)(a); and, if the applicant does not satisfy that criterion, that the applicant meets the complementary protection criterion under s 36(2)(aa), which gives effect to some of Australia's non-refoulement obligations under international instruments. The first appellant, an Iraqi national, sought a protection visa relying on s 36(2)(a) and s 36(2)(aa) of the Migration Act. The first appellant said he feared persecution1, and would suffer significant harm2, if returned to Iraq because, while in Iraq, he sold alcohol, which is banned by local law in some parts of Iraq and considered "immoral" and "un-Islamic" by Sunni and Shi'ite extremists. The claims of the second and third appellants, the first appellant's wife and child, depended on the claims of the first appellant. The Immigration Assessment Authority ("the Authority") found that the first appellant had not been personally targeted for reasons relating to the sale of alcohol, that he did not face a real risk of harm if returned to Iraq because he had sold alcohol previously, and, critically for this appeal, that if the first appellant returned to Iraq he would not continue to sell alcohol. The Authority affirmed the decision of the delegate of the then Minister for Immigration and Border Protection3 ("the Minister") not to grant and determination of, the first appellant's claim under s 36(2)(a) was not in issue in this Court. appellants protection visas. The Authority's approach the This Court held in Appellant S395/2002 v Minister for Immigration and Multicultural Affairs4 that, in assessing the refugee criterion in s 36(2)(a), an asylum seeker cannot be expected to hide or change behaviour that is the manifestation of a protected characteristic under the Convention relating to the Status of Refugees as modified by the Protocol relating to the Status of Refugees 1 Migration Act, s 36(2)(a). 2 Migration Act, s 36(2)(aa). 3 Now the Minister for Home Affairs. (2003) 216 CLR 473 at 489-491 [40]-[43], 500-502 [80]-[83], 503 [88]. Gordon Edelman Steward ("the Convention") in order to avoid persecution5. Appellant S395 preceded both the insertion of s 36(2)(aa)6 and subsequent amendments to s 36(2)(a)7. The sole question raised by this appeal is whether the Authority committed jurisdictional error in failing to apply the principle in Appellant S395 when considering the first appellant's application for complementary protection under s 36(2)(aa)8, namely, in failing to ask why the first appellant would not sell alcohol if he returned to Iraq. The appellants' contention that the Authority should have applied that principle when considering the first appellant's application for complementary protection was based on what was said to be the protective objective behind s 36(2)(aa) and the absolute and non-derogable nature of the international obligations to which it gives effect, as well as what were said to be similarities between s 36(2)(a) and s 36(2)(aa). As these reasons will explain, the differences in the text, context and purpose of s 36(2)(a) and s 36(2)(aa) and, thus, in the construction and application See also Minister for Immigration and Border Protection v SZSCA (2014) 254 CLR Section 36(2)(aa) (Complementary Protection) Act 2011 (Cth), s 2(1), Sch 1, item 12. in March 2012: Migration Amendment commenced Section 36(2)(a) was substantively amended, and ss 5H and 5J were inserted, in 2014 as part of a suite of amendments introduced by the Migration and Maritime Powers Legislation Amendment (Resolving the Asylum Legacy Caseload) Act 2014 (Cth), s 2(1), Sch 5, items 7 and 10. The relevant amendments commenced on 18 April 2015. for Immigration and Border Protection 8 The appellants' application in the Federal Circuit Court of Australia for judicial review of the Authority's decision was dismissed on 3 August 2017: see DQU16 v Minister [2017] FCCA 1818. On 14 December 2018, the Federal Court of Australia granted the appellants an extension of time to appeal to the Federal Court against the judgment of the Federal Circuit Court, subject to the notice of appeal being confined to the single ground that the Authority committed jurisdictional error by failing to apply the principles in Appellant S395 when considering the complementary protection criterion under s 36(2)(aa) of the Migration Act: see DQU16 v Minister for Home Affairs [2018] FCA 1695. On 22 April 2020, the Federal Court dismissed the appeal: see DQU16 v Minister for Home Affairs [2020] FCA 518. Gordon Edelman Steward of the separate criteria in s 36(2)(a) and s 36(2)(aa) compel the conclusion that the principle in Appellant S395 in relation to s 36(2)(a) (whether as that provision was framed at the time of the decision or as now in force) does not apply to the statutory task when considering the complementary protection criterion in s 36(2)(aa). The appeal should be dismissed. Appellant S395 and the statutory task under s 36(2)(a) In Appellant S395, this Court was concerned with a claim for protection based on a person's refugee status under what became s 36(2)(a) of the Migration Act9. Central to the reasoning in Appellant S395 was the definition of "refugee" in Art 1A(2) of the Convention. The definition contains four cumulative elements10: "(1) the person concerned must fear 'persecution' in the country of his or her nationality; (2) the persecution so feared must be 'for reasons of race, religion, nationality, membership of a particular social group or political opinion'; (3) that fear of persecution for one or more of those Convention reasons must be 'well-founded'; and (4) the person must be outside the country of his or her nationality 'owing to' that well-founded fear". It is sufficient for present purposes to focus on the second and third elements of the definition. Both elements reflect that the purpose of the Convention is to "protect the individuals of every country from persecution on the grounds identified in the Convention whenever their governments wish to inflict, or are powerless to prevent, that persecution"11. The third element of the definition, which is objective, "requires the decision-maker to decide what may happen if the applicant returns to the country of nationality"12. That element requires 9 As in force in 2001, s 36(2) provided that "[a] criterion for a protection visa is that the applicant for the visa is a non-citizen in Australia to whom Australia has protection obligations under the Refugees Convention as amended by the Refugees Protocol". 10 SZSCA (2014) 254 CLR 317 at 330 [35]. 11 Appellant S395 (2003) 216 CLR 473 at 489 [40]; see also 490-491 [41]. 12 Appellant S395 (2003) 216 CLR 473 at 499 [73]. Gordon Edelman Steward consideration of the situation of a particular applicant and "identification of the relevant Convention reasons that the applicant has for fearing persecution"13. The Refugee Review Tribunal ("the Tribunal") in Appellant S395 had accepted that it was not possible for the protection visa applicants in that case to live openly as homosexuals in Bangladesh, but found that they had previously conducted themselves "discreetly" in Bangladesh, and there was no reason to suppose that they would not continue to do so if they returned to that country. The Tribunal concluded that the applicants were not entitled to protection visas. The Tribunal's reasoning was held to be fallacious. The principle for which Appellant S395 stands is that "a fear of persecution for a Convention reason, if it is otherwise well-founded, remains well-founded even if the person concerned would or could be expected to hide his or her race, religion, nationality, membership of a particular social group, or political opinion by reason of that fear to avoid a real chance of persecution"14. The principle and "directs attention to why the person would or could be expected to hide or change the manifestation of a Convention characteristic"15 behaviour (emphasis added). thereby that The rationale for the principle is that a person who would otherwise be entitled to protection under s 36(2)(a) will not, and should not, lose that protection if it can be shown that the person would or could avoid persecution by sacrificing a protected attribute under the Convention. The principle, and its rationale, ensure that "the very protection that the Convention is intended to secure" for those facing persecution because of a protected attribute is not undermined, or surrendered, by requiring such a person to conceal that attribute on return to their home country16. 13 Appellant S395 (2003) 216 CLR 473 at 499 [73]. 14 SZSCA (2014) 254 CLR 317 at 330 [36]. 15 SZSCA (2014) 254 CLR 317 at 330-331 [37]. 16 SZSCA (2014) 254 CLR 317 at 330 [36], citing HJ (Iran) v Secretary of State for the Home Department [2011] 1 AC 596 at 656 [110]. Gordon Edelman Steward Section 36(2)(a) was amended in 2014. At the same time, ss 5H and 5J were inserted17: s 5H provides a definition of "refugee" and s 5J provides a definition of "well-founded fear of persecution", largely codifying the definition of "refugee" under the Convention. The question that s 36(2)(a) asks is whether a person is owed protection obligations because they are a refugee. The statutory definition of "refugee" in s 5H directs attention to whether a person is unable or unwilling to avail himself or herself of the protection of his or her country of nationality, or unable or unwilling to return to the country of his or her former habitual residence, owing to a well-founded fear of persecution for one of the reasons set out in s 5J(1) (which in turn correspond to the five grounds for refugee status listed in Art 1A(2) of the Convention: race, religion, nationality, membership of a particular social group or political opinion). A fear of persecution will be "well-founded" if there is a "real chance" that the person will suffer the feared persecution if returned18. A "real chance" is a prospect that is not "remote" or "far-fetched": it does not require a likelihood of persecution on the balance of probabilities19. Section 5J(3) provides exceptions to what constitutes a well-founded fear of persecution. It provides that a person does not have a well-founded fear of persecution "if the person could take reasonable steps to modify his or her behaviour so as to avoid a real chance of persecution in a receiving country", unless the modification, among other things, relates to fundamental, innate or immutable characteristics. The qualification has the effect that s 5J(3) is not inconsistent with the principle in Appellant S39520. 17 Migration and Maritime Powers Legislation Amendment (Resolving the Asylum Legacy Caseload) Act 2014 (Cth), Sch 5, item 7. 18 Migration Act, s 5J(1)(b). The real chance of persecution must relate to all areas of a receiving country: Migration Act, s 5J(1)(c). 19 Chan v Minister for Immigration and Ethnic Affairs (1989) 169 CLR 379 at 389, 398, 407, 429; Australia, House of Representatives, Migration and Maritime Powers Legislation Amendment (Resolving the Asylum Legacy Caseload) Bill 2014, Explanatory Memorandum at 10. See also Minister for Immigration and Citizenship v SZQRB (2013) 210 FCR 505 at 551 [242]; CGA15 v Minister for Home Affairs (2019) 268 FCR 362 at 369-370 [22]. 20 Australia, House of Representatives, Migration and Maritime Powers Legislation Amendment Explanatory Memorandum at 174 [1194]. See also, for example, Minister for the Asylum Legacy Caseload) Bill (Resolving Gordon Edelman Steward Statutory task under s 36(2)(aa) Section 36(2)(aa), which implemented the regime for "complementary protection" and with which this appeal is concerned, was inserted into the Migration Act21 to provide an additional basis to s 36(2)(a) for the grant of a protection visa. Section 36(2)(aa) provides: "A criterion for a protection visa is that the applicant for the visa is: a non-citizen in Australia (other than a non-citizen mentioned in paragraph (a)) in respect of whom the Minister is satisfied Australia has protection obligations because the Minister has substantial grounds for believing that, as a necessary and foreseeable consequence of the non-citizen being removed from Australia to a receiving country, there is a real risk that the non-citizen will suffer significant harm". Section 36(2)(aa) applies where the applicant does not fall within s 36(2)(a) of the Act22 and it engages some, but not all, of Australia's non-refoulement obligations under the International Covenant on Civil and Political Rights ("the ICCPR") and the Convention Against Torture and Other Cruel, Inhuman or Degrading Treatment or Punishment ("the CAT")23. The provision was introduced to "allow all claims by visa applicants that may engage Australia's non-refoulement obligations under the [identified] human rights instruments to be considered under Immigration and Border Protection v BBS16 (2017) 257 FCR 111 at 140 [82]; AWL17 v Minister for Immigration and Border Protection [2018] FCA 570 at [41]. The Minister accepted that the principles in Appellant S395 may still be relevant in determining whether a person is a "refugee" under s 5H. 21 Migration Amendment (Complementary Protection) Act 2011 (Cth), with effect from 24 March 2012. 22 SZTAL v Minister for Immigration and Border Protection (2017) 262 CLR 362 23 SZTAL (2017) 262 CLR 362 at 365-366 [1]-[5]; Minister for Immigration and Citizenship v MZYYL (2012) 207 FCR 211 at 215 [18]-[20]. Gordon Edelman Steward a single protection visa application process, with access to the same transparent, reviewable and procedurally robust decision-making framework ... available to applicants who make claims that may engage Australia's obligations under the ... Convention"24. Importantly, however, s 36(2)(aa) only relevantly captures Australia's non-refoulement obligations under the ICCPR and the CAT, by which Australia agreed not to return a non-citizen to a receiving country where they would be subjected to the death penalty, arbitrarily deprived of their life or subjected to torture or cruel, inhuman or degrading treatment or punishment: it does not incorporate into domestic law any of the other protections contained within the ICCPR as a basis upon which a protection visa may be granted. The question s 36(2)(aa) asks is whether the decision-maker has substantial grounds for believing that there is a real risk that a person will suffer significant harm, as defined in s 36(2A) and subject to the matters in s 36(2B) and (2C), as a "necessary and foreseeable consequence" of the person's return to a receiving country. The inquiry is prospective. There are three elements that must be satisfied for the prospective harm to satisfy s 36(2)(aa): (1) the decision-maker must have substantial grounds for believing (2) that, as a necessary and foreseeable consequence of the non-citizen being removed from Australia to a receiving country, (3) there is a real risk that the non-citizen will suffer significant harm. The circumstances constituting "significant harm" are exhaustively identified in s 36(2A) in the following terms: "[I]f: the non-citizen will be arbitrarily deprived of his or her life; or the death penalty will be carried out on the non-citizen; or the non-citizen will be subjected to torture; or the non-citizen will be subjected to cruel or inhuman treatment or punishment; or 24 Australia, House of Representatives, Migration Amendment (Complementary Protection) Bill 2011, Explanatory Memorandum at 1. Gordon Edelman Steward the non-citizen will be subjected to degrading treatment or punishment." The specific harms identified in paras (a) and (b) of s 36(2A), namely, arbitrary deprivation of life and being subject to the death penalty, are intended to give effect to Art 6 of the ICCPR, which prohibits the arbitrary deprivation of life and prescribes when the death penalty may be carried out in countries which have not abolished it25. "[T]orture", in para (c), is defined26 to mean "an act or omission by which severe pain or suffering, whether physical or mental, is intentionally inflicted on a person" for specific identified purposes including intimidating or coercing the person or a third person. In order to fall within para (d) or (e) of s 36(2A), the acts or omissions constituting "cruel or inhuman treatment or punishment" or "degrading treatment or punishment", by definition27, are considered against Art 7 of the ICCPR28. Relevantly, "cruel or inhuman treatment or punishment" means an act or omission by which, among other things, "severe pain or suffering, whether physical or mental, inflicted on a person" or "pain or suffering, whether physical or mental, is intentionally inflicted on a person so long as, in all the circumstances, the act or omission could reasonably be regarded as cruel or inhuman in nature". The other kind of harm – "degrading treatment or punishment" – refers to "an act or omission that causes, and is intended to cause, extreme humiliation which is unreasonable". intentionally The decision-maker must also consider, in the context of paras (c) to (e) of s 36(2A), whether the acts or omissions arise from, or are inherent in or 25 Regarding arbitrary deprivation of life, see SZDCD v Minister for Immigration and Border Protection [2019] FCA 326 at [33]-[35]. 26 Migration Act, s 5(1) definition of "torture". 27 Migration Act, s 5(1) definitions of "cruel or inhuman treatment or punishment" and "degrading treatment or punishment". 28 Although the definitions are not taken from the ICCPR, which does not provide a definition of "cruel, inhuman or degrading treatment or punishment": see SZTAL (2017) 262 CLR 362 at 366 [4]-[5], 377 [45], 387 [78]. Gordon Edelman Steward incidental to, lawful sanctions that are not inconsistent with the Articles of the ICCPR29. Principle in Appellant S395 does not apply to complementary protection claims As is self-evident, the text of s 36(2)(a) and s 36(2)(aa) is different and therefore, unsurprisingly, the statutory questions are different: they are not interchangeable. And they are different because the purpose of the inquiry under each provision is different30. Determining whether a person has a well-founded fear of persecution for a Convention reason under s 36(2)(a) is a fundamentally different inquiry to the question in s 36(2)(aa). Section 36(2)(a) seeks to define to a person seeking refuge. when a protection visa will be granted Under s 36(2)(aa), the question is whether a person can be returned to a particular State: and the provision is formulated by reference to the consequences of a non-citizen's removal to a particular State. The fact that the Explanatory Memorandum to the Migration Amendment (Complementary Protection) Bill 2011, containing what became s 36(2)(aa), recorded31 that Australia's non-refoulement obligations under the ICCPR and the CAT are "absolute and cannot be derogated from" does not support the contention that the principle in Appellant S395 has any application in assessing the complementary protection criterion under s 36(2)(aa). The relevant question is not what the ICCPR and the CAT provide, but rather the statutory question posed by s 36(2)(aa)32, which engages some, but not all, of Australia's non-refoulement 29 Migration Act, s 5(1) definitions of "cruel or inhuman treatment or punishment", "degrading treatment or punishment" and "torture". 30 See, eg, Minister for Immigration and Citizenship v Anochie (2012) 209 FCR 497 at 516 [78]; SZQRB (2013) 210 FCR 505 at 526 [99]-[100]; SZTAL (2017) 262 CLR 31 Australia, House Representatives, Migration Amendment (Complementary Protection) Bill 2011, Explanatory Memorandum at 3. 32 Dietrich v The Queen (1992) 177 CLR 292 at 305; Minister for Immigration and Ethnic Affairs v Teoh (1995) 183 CLR 273 at 287; CPCF v Minister for Immigration and Border Protection (2015) 255 CLR 514 at 527-528 [10]-[12]. Gordon Edelman Steward the ICCPR and the CAT33. The statutory question, obligations under namely whether a person can be removed to a particular State without suffering identified forms of harm, is framed by reference to the risk of a non-citizen suffering significant and specified harm as a necessary and foreseeable consequence of removal to a receiving country. Assessing the risk that a non-citizen will suffer significant harm within s 36(2A) necessarily involves an assessment of the individual circumstances of the non-citizen and the basis on which the non-citizen claims that those circumstances give rise to the requisite degree of risk as a necessary and foreseeable consequence of removal to a receiving country. Another important difference arising from the different statutory text and purpose of the inquiry under s 36(2)(a) and s 36(2)(aa) is that the nature of the harm at which each provision is directed is different. The Convention will be satisfied by persecution which may fall well short of death, torture or irreparable harm. Non-refoulement obligations under the ICCPR are directed at irreparable harm of the specific kinds contemplated in Arts 6 and 7 of the ICCPR, which include being arbitrarily deprived of life or subjected to the death penalty; subjected to torture; subjected to cruel or inhuman treatment or punishment; or subjected to degrading treatment or punishment. In relation to the harm at which s 36(2)(aa) is directed, two further aspects of the provision are of particular significance. The definition of "significant harm" in s 36(2A) is not formulated by reference to a person's inherent or immutable beliefs, attributes, characteristics or membership of a particular group. And assessment of the risk of that harm under s 36(2)(aa) does not involve finding a nexus between the harm feared by the non-citizen and those beliefs, attributes or the non-citizen's membership of a particular group. characteristics, or The provision only requires an assessment of the "necessary and foreseeable consequence[s]" of a person's return to a receiving country. It is a corollary of the statutory test in s 36(2)(aa) being framed in those terms that where a risk of "significant harm" can be avoided by modification of behaviour, such modification does not involve a manifestation of the very harm at which the criterion in s 36(2)(aa) is directed. Of course, in some, perhaps many, cases in which the criterion in s 36(2)(aa) is satisfied, the basis for the risk of significant harm will be inherent to, or an immutable characteristic of, the non-citizen and modification of conduct may 33 SZTAL (2017) 262 CLR 362 at 365-366 [1]-[5]; MZYYL (2012) 207 FCR 211 at 215 Gordon Edelman Steward not be possible. The bases for the claimed risk of significant harm are not prescribed but may include, for example, the fact that an applicant may have already committed an offence for which they will receive the death penalty if returned to a receiving country. In those cases, the principle in Appellant S395 not only is inapplicable as a matter of statutory construction but is necessarily superfluous: no modification of behaviour could avoid the risk of significant harm. In other cases, a decision-maker may find that a non-citizen is in a position to, and would, on their return to a receiving country, modify their behaviour in a way which would avoid the relevant significant harm so that the harm would not be the necessary and foreseeable consequence of their removal to that country. In those cases, there is nothing in the text, context or purpose of s 36(2)(aa) requiring the decision-maker to consider why the non-citizen would modify their behaviour. That an applicant might modify their behaviour in response to the possibility of significant harm as defined in s 36(2A) does not itself involve a realisation of the harm at which s 36(2)(aa) is directed. The underlying motivation of the applicant is not required to be considered under s 36(2)(aa). It is simply the case that, if, by modification of behaviour, a person will avoid a risk of harm of the kind at which s 36(2)(aa) is directed, it cannot be said to be a "necessary and foreseeable consequence" of the person's refoulement to that place that they will be at risk of that kind of harm34. that the approach The appellants' further contention, Appellant S395 applies when considering s 36(2)(aa) because the test for "real chance" in s 36(2)(a) is the same as that required for "real risk" under s 36(2)(aa), is misconceived35. "Real chance" and "real risk", in s 36(2)(a) and s 36(2)(aa) respectively, are the standards by which the decision-maker is required to assess the relevant risks of harm. That the standards by which the relevant risks of harm are to be assessed are the same does not address the fact that the statutory question, including, importantly, the relevant kinds of harm against which the risks are to be assessed, is substantively different in each provision. taken 34 See CRI026 v Republic of Nauru (2018) 92 ALJR 529 at 541 [43]; 355 ALR 216 It has been accepted in the Full Court of the Federal Court that the "real risk" standard that applies to complementary protection under s 36(2)(aa) is the same as the "real chance" test applicable under s 36(2)(a): see, eg, SZQRB (2013) 210 FCR Gordon Edelman Steward The decision in Appellant S395, therefore, does not apply to a claim for complementary protection. The rationale for the principle in Appellant S395 does not, and cannot, apply to the inquiry under s 36(2)(aa), which requires an assessment of the "necessary and foreseeable consequence[s]" of a person returning to a receiving country. The decision is not directed at a prohibition on refoulement to the kinds of harm contemplated in the ICCPR and the CAT. Indeed, as Gageler J recognised in Minister for Immigration and Border Protection v SZSCA, in the course of warning against the extension of the principle in Appellant S395 "beyond its rationale", the principle has no application to a person who would or could be expected to hide or change their behaviour when that behaviour is not a manifestation of a Convention characteristic36 – a warning now given effect by s 5J(3), which expressly requires a decision-maker to have regard to the prospect of behavioural modifications which are unrelated to Convention characteristics. Something further needs to be said about s 5J(3). The appellants contended that the absence of an equivalent provision to s 5J(3) in relation to s 36(2)(aa) was indicative of a legislative intention to limit the application of the principle in Appellant S395 to refugee claims arising under s 36(2)(a), but not to limit its application to complementary protection claims under s 36(2)(aa). That contention should be rejected. For the reasons stated37, the principle in Appellant S395 has no application to the assessment of a complementary protection claim under s 36(2)(aa). In any event, the appellants' contention misunderstands the effect of s 5J(3). The sub-section provides that a person does not have a well-founded fear of persecution if the person could take reasonable steps to modify his or her behaviour so as to avoid persecution, other than modifications of the kind listed in s 5J(3)(a) to (c), which are modifications relating to characteristics protected by the Convention: that is, innate or immutable characteristics of the person, such as identity, disability, race, ethnicity, religious beliefs, sexual orientation and so on. As the Explanatory Memorandum38 to the Bill that introduced s 5J(3) expressly noted, the sub-section is consistent with the principle stated in Appellant S395 and (2014) 254 CLR 317 at 330-331 [37]-[38]. 37 See [18]-[25] above. 38 Australia, House of Representatives, Migration and Maritime Powers Legislation the Asylum Legacy Caseload) Bill Amendment Explanatory Memorandum at 174 [1194]. See also [10] above. (Resolving Gordon Edelman Steward that its rationale. It preserves the protection that the Convention intended to secure, and ensures is not "extended beyond its rationale"39. The principle will therefore not apply where a person may be expected to modify behaviour that is not a manifestation of a Convention characteristic. the principle articulated in Appellant S395 Overlapping claims and s 36(2)(a) s 36(2)(aa) overlap, Although the statutory questions posed by s 36(2)(a) and s 36(2)(aa) are different, it has long been recognised40 that, to the extent that the factual bases for claims under a decision-maker, when considering the complementary protection criterion under s 36(2)(aa), is entitled to refer to and rely on any relevant findings the decision-maker made when considering the refugee criterion under s 36(2)(a). The question under s 36(2)(aa) then is whether, in light of those and any other relevant findings, as a necessary and foreseeable consequence of the non-citizen being removed from Australia to a receiving country, there is a real risk that the non-citizen will suffer significant harm of the kind prescribed in s 36(2A), subject to s 36(2B) and (2C). And, as will be seen, that is what the Authority did in this case. Appellants' claims and the decision of the Authority The appellants are Iraqi nationals and Shia Muslims from Nasiriya, Dhi Qar, Iraq. The second and third appellants are the wife and child of the first appellant. The in Australia as first and second appellants arrived "unauthorised maritime arrivals" within the meaning of s 5AA of the Migration Act on 23 August 2012. The in Australia. Subsequently, on 3 September 2015, the appellants lodged applications for temporary protection visas. The first appellant claimed protection as a refugee under s 36(2)(a) and complementary protection under s 36(2)(aa). The second and third appellants did not apply for protection in their own rights, but as members of the first appellant's family unit under s 36(2)(b)(i) and (c)(i) of the Migration Act. third appellant was born 39 SZSCA (2014) 254 CLR 317 at 330 [37]. 40 See, eg, SZSGA v Minister for Immigration, Multicultural Affairs and Citizenship [2013] FCA 774 at [56]; SZSQG v Minister for Immigration and Citizenship (2013) 136 ALD 360 at 375-377 [84]-[93]; SZSHK v Minister for Immigration and Border Protection (2013) 138 ALD 26 at 34 [31]; BCX16 v Minister for Immigration and Border Protection (2019) 164 ALD 313 at 318 [23]. Gordon Edelman Steward On 9 September 2016, a delegate of the Minister refused to grant the appellants protection visas. That decision was referred to the Authority for review under the fast track review scheme provided by Pt 7AA of the Migration Act. The basis of the first appellant's claims for protection were summarised in the Authority's reasons. The first appellant worked as a private alcohol seller in Nasiriya between 2010 and 2012, selling liquor obtained from Baghdad from his car at various locations and arranging sales by phone. In 2012, he discovered that the "Mahdi Army", or "JAM", as it was referred to in the Authority's reasons, a "strong militant group", was planning to kill him because of his work as an alcohol seller. Around this time, he reported being shot at and chased by a vehicle or motorbike. He subsequently arranged to leave Iraq due to his fear of harm. Authority's consideration of s 36(2)(a) from The Authority commenced by considering the first appellant's claim for protection as a refugee under s 36(2)(a). The Authority accepted the first appellant's claim that he worked as an alcohol seller in Iraq, noting that he had consistently made this claim since arriving in Australia. The Authority referred to reports, for Refugees, the United Nations High Commissioner that in primarily conservative Shi'ite communities alcohol shops are banned by local law, while in the major cities of Baghdad, Basrah, Kirkuk and Mosul, shops and bars are severely restricted by the "conservative political and social atmosphere" because the consumption of alcohol is considered "un-Islamic" or "immoral behaviour". The Authority also accepted that alcohol sellers and those consuming alcohol have been targets of violence inflicted by militia groups in the past and that Sunni and Shi'ite extremists have in the past reportedly attacked liquor shops "with impunity". But the Authority did not accept the first appellant's claims that he was followed by members of the Mahdi Army, that he was shot at or chased by a vehicle or motorbike, or that he "is or was" of interest to the Mahdi Army or militia groups for reasons relating to the sale of alcohol, the consumption of alcohol by the first appellant or his friends, or any smuggling of alcohol between Iraq and Iran. The Authority accordingly found that the first appellant and his family did not face a "real chance" of harm on these bases now or in the foreseeable future. The Authority then considered the first appellant's claim that "because the sale of alcohol is forbidden by Islamic law, [the first appellant] will not be forgiven [on return to Iraq] even if he were to cease this conduct". Having regard to s 5J(3) of the Migration Act, the Authority considered that, because the first appellant could take reasonable steps to modify his behaviour so as to avoid a real chance of Gordon Edelman Steward persecution by ceasing to sell alcohol on return, and there was no country information indicating that persons who had previously sold alcohol are targeted once they have stopped, the first appellant did not have a well-founded fear of persecution on the basis that he had sold alcohol in the past. In addressing the first appellant's future employment, the Authority turned to the question of whether he would continue to sell alcohol upon return to Iraq. The Authority's reasons record that at his interview for a temporary protection visa, the first appellant initially stated that it would not be an option for him to return to Iraq and not sell alcohol, but when asked whether it had ever been an option for him to stop selling alcohol after finding out that the Shia militia were interested in him, he said he had decided to quit. After setting out the first appellant's education and employment history, which included having completed nursing studies and working as a mechanic, the Authority concluded that if the first appellant was returned to Iraq, he would be concerned about his own safety and the safety of his wife and child and he would not engage in selling alcohol. For the purposes of s 5J(3), the Authority turned to consider whether the first appellant could take reasonable steps to modify his behaviour so as to avoid a real chance of persecution by ceasing to sell alcohol on return and concluded that he could. It was observed in the Federal Court that it was implicit in the Authority's reasoning that the Authority proceeded on the basis that the first appellant may have satisfied the protection visa criterion in s 36(2)(a) on the basis that being a "seller of alcohol" constitutes "membership of a particular social group" for the purposes of the definition of "refugee" in s 5H and the reasons listed in s 5J(1). It suffices for present purposes to observe that the Authority's conclusion under s 5J(3), consistent with the principle in Appellant S395, was only open if, in the circumstances faced by the first appellant, feared persecution by reason of being an alcohol seller was not a manifestation of a Convention characteristic: that is, it was not a fear faced because of the first appellant's "membership of a particular social group" under s 5J(1). As noted above, the Authority's approach to, and determination of, the first appellant's claim under s 36(2)(a) was not in issue in this Court. Authority's consideration of s 36(2)(aa) The Authority then turned to consider the first appellant's claim for complementary protection under s 36(2)(aa). The Authority correctly identified the statutory question: whether there were substantial grounds for believing that, as a necessary and foreseeable consequence of the first appellant being removed from Australia to Iraq, there was a real risk that he would suffer significant harm within the meaning of s 36(2A). Relevantly, and critically for the purposes of the Gordon Edelman Steward present appeal, having earlier found that the first appellant would not work as an alcohol seller upon his return to Iraq, the Authority found that he did not face "a real risk of harm" in Iraq on that basis. Accordingly, the Authority found that there were not substantial grounds for believing that, as a necessary and foreseeable consequence of the first appellant being returned to Iraq, there was a real risk that he would suffer significant harm of a kind listed in s 36(2A). And, as has been explained, the Authority did not commit jurisdictional error in not applying the principle in Appellant S395 when considering the first appellant's application for complementary protection under s 36(2)(aa). The conclusion that there was no real risk of significant harm to the first appellant as a necessary and foreseeable consequence of him being returned to Iraq followed from the finding that he would not sell – that is, there was no real possibility of him selling – alcohol when he returned to Iraq. Other cases may be less clear cut. In some cases, it may not be possible to make as definite a conclusion about an applicant's future conduct as the Authority did here. It is always necessary to recall that the question is whether there is a real risk of significant harm if an applicant is returned to a receiving country. That assessment will depend on the facts in any given case. As the first appellant's wife and child did not make their own claims for protection, the Authority found that they did not meet the family unit criteria in s 36(2)(b)(i) or (c)(i). On 2 November 2016, the Authority affirmed the decision of the delegate not to grant the appellants protection visas. Conclusion and orders For those reasons, the Authority did not make the jurisdictional error the appellants alleged. The appeal should be dismissed with costs.

HIGH COURT OF AUSTRALIA SDCV AND APPELLANT DIRECTOR-GENERAL OF SECURITY & ANOR RESPONDENTS SDCV v Director-General of Security [2022] HCA 32 Date of Hearing: 7 & 8 June 2022 Date of Judgment: 12 October 2022 ORDER Appeal dismissed with costs. On appeal from the Federal Court of Australia Representation C L Lenehan SC with T M Wood and S N Rajanayagam for the appellant (instructed by Michael Jones, Solicitor) S P Donaghue QC, Solicitor-General of the Commonwealth, with M J H Varley and M F Caristo for the respondents (instructed by Australian Government Solicitor) M G Sexton SC, Solicitor-General for the State of New South Wales, with M W R Adams for the Attorney-General for the State of New South Wales, intervening (instructed by Crown Solicitor's Office (NSW)) J A Thomson SC, Solicitor-General for the State of Western Australia, with J M Vincent for the Attorney-General for the State of Western Australia, intervening (instructed by State Solicitor's Office (WA)) G A Thompson QC, Solicitor-General of the State of Queensland, with F J Nagorcka and K J E Blore for the Attorney-General of the State of Queensland, intervening (instructed by Crown Law (Qld)) M J Wait SC, Solicitor-General for the State of South Australia, with L M Foran for the Attorney-General for the State of South Australia, intervening (instructed by Crown Solicitor (SA)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS SDCV v Director-General of Security Constitutional law (Cth) – Judicial power of Commonwealth – Where adverse security assessment of appellant, accompanied by statement of grounds, certified by Director-General of Security on behalf of Australian Security Intelligence Organisation ("ASA decision") – Where appellant's visa cancelled on character grounds in consequence of ASA decision – Where appellant applied to Administrative Appeals Tribunal for merits review of ASA decision – Where Minister administering Australian Security Intelligence Organisation Act 1979 (Cth) issued certificates under s 39B(2)(a) of Administrative Appeals Tribunal Act 1975 (Cth) ("AAT Act") stating that disclosure of some of contents of documents relating to ASA decision would be contrary to public interest because disclosure would prejudice security of Australia ("certificated matter") – Where Tribunal provided with certificated matter but certificated matter not disclosed to appellant or appellant's legal representatives – Where Tribunal affirmed ASA decision – Where appellant appealed to Federal Court of Australia pursuant to s 44 of AAT Act – Where s 46(1) of AAT Act allowed Federal Court to have regard to certificated matter in determining appeal – Where s 46(2) of AAT Act provided that Federal Court shall do all things necessary to ensure that certificated matter not disclosed to any person other than member of court as constituted for purposes of proceeding – Where certificated matter not disclosed to appellant or appellant's legal representatives in Federal Court – Whether s 46(2) of AAT Act invalid on basis that Ch III of Constitution precludes making of law that denied party to proceedings in court of federal judicature fair opportunity to respond to evidence on which order of court which finally altered or determined right or legally protected interest of party might be based – Whether s 46(2) of AAT Act invalid on basis that it required or authorised Federal Court to act in manner inconsistent with essential character of court or with nature of judicial power. Words and phrases – "adverse security assessment", "all things necessary to ensure", "balancing exercise", "denial of disclosure", "essential characteristics of a court", "fair opportunity to respond", "forensic advantage", "gist", "judicial power of the Commonwealth", "national security", "officer of the court", "practical injustice", "procedural fairness", "public interest", "public interest immunity", "special advocate". Constitution, Ch III. Administrative Appeals Tribunal Act 1975 (Cth), ss 39A, 39B, 43AAA, 44, 46. Australian Security Intelligence Organisation Act 1979 (Cth), s 54. KIEFEL CJ, KEANE AND GLEESON JJ. The appellant's visa was cancelled on character grounds pursuant to s 501(3) of the Migration Act 1958 (Cth) in consequence of an adverse security assessment ("ASA") certified by the first respondent, the Director-General of Security ("the Director-General"), on behalf of the Australian Security Intelligence Organisation ("ASIO") ("the ASA certificate"). The ASA certificate was accompanied by a statement of grounds, which is deemed part of that assessment and which is required to contain all information that has been relied upon by ASIO in making the assessment, other than information the inclusion of which would, in the opinion of the Director-General, be contrary to the requirements of security1. Together, the ASA certificate and the statement of grounds comprise "the ASA decision". The ASA decision was authorised under the Australian Security Intelligence Organisation Act 1979 (Cth) ("the ASIO Act"). The ASA certificate stated that the appellant had been assessed to be, directly or indirectly, a risk to security2, and that it would not be consistent with the requirements of security for the appellant to continue to hold his visa, and recommended that his visa be cancelled3. The appellant was entitled to be informed that the ASA decision had been made and to be provided with a copy of it, except to the extent that the Minister administering the ASIO Act ("the ASIO Minister")4 certified in writing that the Minister was satisfied, relevantly, that disclosure to a person of the statement of grounds, or of a particular part of that statement, would be prejudicial to the interests of security5. The appellant was provided with a statement of grounds noted to have sections omitted in consequence of a certificate signed by the ASIO Minister under s 38(2)(b) of the ASIO Act ("the public interest non-disclosure certificate")6. Accordingly, the appellant was not to be, and was never, informed of all the information with respect to the ASA decision. s 37(2) of the Australian Security Intelligence Organisation Act 1979 (Cth). See s 4 of the ASIO Act, definition of "security". SDCV v Director-General of Security (2021) 284 FCR 357 at 371 [49]. 4 Administrative Appeals Tribunal Act 1975 (Cth), s 3(1), definition of "ASIO Minister". s 38(1), (2) of the ASIO Act. SDCV v Director-General of Security (2021) 284 FCR 357 at 371 [50]. The ASA decision was furnished to the Department of Home Affairs7. Subsequently, as noted above, the Minister for Home Affairs cancelled the appellant's visa pursuant to s 501(3) and (6)(g) of the Migration Act, on the basis that the Minister reasonably suspected that the appellant did not pass the character test and was satisfied that the cancellation of his visa was in the national interest. On the same day, the appellant was provided with a notice of visa cancellation and the stated grounds accompanying the ASA certificate8. The appellant applied to the Administrative Appeals Tribunal ("the Tribunal") for review of the merits of the ASA decision. For the purposes of the review by the Tribunal, the ASIO Minister issued certificates under s 39B(2)(a) of the Administrative Appeals Tribunal Act 1975 (Cth) ("the AAT Act") stating that disclosure of some of the contents of documents relating to the ASA decision would be contrary to the public interest because it would prejudice the security of Australia ("the certificated matter"). The Tribunal was provided with the certificated matter; but it was not disclosed to the appellant or to his lawyers9. Further, in order to prevent the disclosure of the certificated matter, the ASIO Minister issued certificates under s 39A(8) of the AAT Act, which had the effect that part of the hearing before the Tribunal was conducted in the absence of the appellant and his lawyers. In the "open" session, the Tribunal heard evidence called by both the Director-General and the appellant. Evidence was heard in the "closed" session in the absence of the appellant10. The Tribunal accordingly wrote two sets of reasons: "open" reasons, which did not refer to the certificated matter and were seen by the appellant and his lawyers; and "closed" reasons, which addressed matters in the "closed" session and were not seen by them11. The Tribunal affirmed the ASA decision. The Tribunal's "open" reasons recorded that the Tribunal was not able to form a view on whether the ASA SDCV v Director-General of Security (2021) 284 FCR 357 at 371 [51]. SDCV v Director-General of Security (2021) 284 FCR 357 at 370 [44], 371 [51]. SDCV v Director-General of Security (2021) 284 FCR 357 at 373 [59], 377 [70]. 10 SDCV and Director-General of Security [2019] AATA 6112 at [5]-[6]. 11 SDCV v Director-General of Security (2021) 284 FCR 357 at 373 [59]-[61], decision was justified based on the evidence led in the "open" session12. The reasons continued13: "We have written closed reasons for decision based upon the classified evidence placed before us and have concluded, based upon that evidence, that the ASA [decision] is justified and that the reviewable decision should be affirmed." The appellant appealed against the decision of the Tribunal to the Federal Court of Australia pursuant to s 44 of the AAT Act. The right of appeal under s 44 is confined to questions of law. The appellant raised five substantive grounds of appeal, including a contention that the Tribunal's decision was not open on the evidence before it. The appeal was heard in the original jurisdiction14 of the Federal Court by a Full Court (Bromwich and Abraham JJ, Rares J agreeing). The Federal Court rejected each substantive ground of appeal, concluding, among other things, that the ASA decision was warranted by the evidence available to the Tribunal15. By reason of s 46(1) of the AAT Act, the Federal Court was allowed to have regard to the certificated matter in determining the appeal; but the certificated matter was not disclosed to the appellant or to his legal representatives. In that regard, s 46(2) of the AAT Act provided that the Court "shall … do all things necessary to ensure that the [certificated] matter is not disclosed to any person other than a member of the court as constituted for the purposes of the proceeding". In the course of the appeal to the Federal Court, the appellant also challenged the constitutional validity of s 46(2) of the AAT Act. The Federal Court rejected the constitutional challenge16, and made a declaration that s 46(2) is a valid law of the Commonwealth. The appeal to this Court is concerned only with the appellant's challenge to the validity of s 46(2) of the AAT Act. The appellant's contention is that Ch III of the Constitution precludes the making of a law that denies a party to proceedings in a court of the federal judicature a fair opportunity to respond to the evidence on 12 SDCV and Director-General of Security [2019] AATA 6112 at [19]. 13 SDCV and Director-General of Security [2019] AATA 6112 at [20]. 14 Federal Court of Australia Act 1976 (Cth), s 19(2). 15 SDCV v Director-General of Security (2021) 284 FCR 357 at 361 [1], 16 SDCV v Director-General of Security (2021) 284 FCR 357 at 369 [40], 397 [168]. which an order of the court which finally alters or determines a right or legally protected interest of that party might be based, and that s 46(2) is such a law. As will be explained, there is a fatal artificiality in the appellant's attempt to analyse the effect of s 46(2) without regard to the circumstance that it has no operation independent of s 46(1). Section 46, considered as a whole, does not disadvantage a person in the position of the appellant: it simply offers that person a statutory remedy in addition to the remedies otherwise provided by law, that additional remedy being attended with forensic consequences different from those attending those other remedies. But even if attention is confined to s 46(2) as if it stood alone, it was not apt to occasion practical injustice to the appellant in the determination of his appeal under s 44. In this regard, it is necessary to appreciate the limited statutory rights of the appellant to enter and remain in Australia, the susceptibility of those rights to cancellation upon the making of an ASA, and the undisputed validity, irrespective of any challenge to the ASA decision or its outcome, of the statutory denial of disclosure to the appellant of security-sensitive information including, on review and appeal, the certificated matter. The rights of a visa holder were always qualified by the statutory process of the executive government to deny the visa holder disclosure of security-sensitive grounds for the making of an ASA. It should also be understood that s 46 of the AAT Act applies to an appeal under s 44, which is but one avenue of challenge to the decision of the Tribunal. The appellant might have challenged the Tribunal's decision in proceedings for judicial review under s 75(v) of the Constitution17 or s 39B of the Judiciary Act 1903 (Cth)18, and in those proceedings s 46 would have had no application and so the appellant's alleged disadvantage under s 46(2) would have been avoided. Of course, if the appellant had chosen to bring his challenge to the decision of the Tribunal pursuant to one of those avenues, he would not have enjoyed the forensic advantage conferred by s 46(1) because public interest immunity would likely have prevented the use of the certificated matter by the Federal Court19. The appellant's argument in this Court is that the vice of s 46(2) of the AAT Act lies in allowing evidence adverse to him to be considered by the Federal Court without his being afforded the opportunity to know and respond to it. But on no view can it be supposed that s 46(2) could be construed such that the appellant might have pursued an appeal under s 44 with the benefit of s 46(1) and shorn of 17 Plaintiff M47/2012 v Director-General of Security (2012) 251 CLR 1 at 146 [376]. 18 Sagar v O'Sullivan (2011) 193 FCR 311 at 312 [1]. 19 See SDCV v Director-General of Security (2021) 284 FCR 357 at 396-397 [166]. the alleged disadvantage of s 46(2). The appellant's choice of s 44 as the avenue of challenge to the ASA decision reflects a judgment that ss 44 and 46 offered him the best chance of a successful challenge to the ASA decision. No practical injustice was caused to the appellant by reason of his choice of preferred remedy. One cannot maintain the proposition that one has been subjected to a practical impediment by reason of the presence of a known obstacle on the path that one has chosen to pursue. As to the possibility that the real vice of s 46(2) of the AAT Act lies in its creation of an institutional difficulty for the Federal Court in hearing and determining an appeal pursuant to s 44 by denying the appellant the ability to know and to respond to evidence adverse to him, it is necessary to appreciate that Ch III of the Constitution does not entrench the adversarial system of adjudication and its incidents as defining characteristics of the courts for which it provides20. The limitation imposed by s 46 on the ability of a person in the position of the appellant to participate in an appeal on a question of law under s 44 does not, in any way, compromise the functioning or impartiality or independence of the Federal Court. Before discussing these matters further, it is necessary to summarise the appellant's circumstances, the statutory context in which the appellant's appeal came before the Federal Court, and the reasons of that Court. The appellant's circumstances This Court has before it the Tribunal's "open" reasons for its decision and a redacted version of the Federal Court's judgment. The following chronology of events leading up to this appeal is drawn from that material. The appellant is a citizen of Lebanon. He married his wife, who is an Australian citizen, in 2010. On 13 December 2012, the appellant was granted a Class BS Subclass 801 Partner (Residence) visa. He made an application for Australian citizenship21. Several of the appellant's relatives were connected with an organisation known as the Islamic State of Iraq and the Levant ("ISIL")22, which was, and 20 Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 100 [157]. 21 SDCV v Director-General of Security (2021) 284 FCR 357 at 370 [45]. 22 SDCV v Director-General of Security (2021) 284 FCR 357 at 370 [46]. remains, specified as a terrorist organisation23. In a summary of the statement of grounds for the ASA certificate, ASIO described ISIL as24: "an Iraq and Syria-based Sunni extremist group and former al-Qa'ida affiliate that adheres to the global jihadist ideology. ISIL follows an extreme interpretation of Islam which is anti-Western, promotes sectarian violence, and targets those who do not agree with its interpretation as infidels and apostates." Some of the appellant's relatives were convicted of and sentenced to imprisonment for attempted terrorism offences committed in Australia. ASIO investigated the appellant as to whether he was involved in those terrorism offences but he was not found to have been involved. Nevertheless, the appellant was advised that his citizenship bestowal ceremony, which was necessary for the conferral of his citizenship, had been delayed pending consideration of whether his visa should be cancelled25. The ASA decision and the cancellation of the appellant's visa As noted above, on 21 August 2018, the appellant's visa was cancelled, the ASA decision having been furnished to the Department of Home Affairs on 16 August 201826. Pursuant to ss 37(2)(a), 38(1), 38(2)(b) and 38(5) of the ASIO Act, a person the subject of an ASA is to be informed of the grounds for the ASA and given all the information relied upon in making it, except to the extent that the Director-General, acting reasonably and under a correct understanding of the law, concludes that such disclosure would be "contrary to the requirements of security"; or the ASIO Minister is satisfied that disclosure "would be prejudicial to the interests of security". Parts of the statement of grounds that accompanied the ASA certificate were deleted in accordance with s 38(2)(b) of the ASIO Act. These 23 See para (b) of the definition of "terrorist organisation" in s 102.1 of the Criminal Code (Cth); s 5 of the Criminal Code (Terrorist Organisation – Islamic State) Regulations 2020 (Cth). 24 SDCV v Director-General of Security (2021) 284 FCR 357 at 372 [54]. 25 SDCV v Director-General of Security (2021) 284 FCR 357 at 370-371 [47]-[48], 26 SDCV v Director-General of Security (2021) 284 FCR 357 at 371 [51]. deletions were consequent upon the public interest non-disclosure certificate signed by the ASIO Minister27. It is to be noted that statutory rights as a visa holder are subject to cancellation upon the making of an ASA, in respect of which the visa holder is to be kept uninformed of security-sensitive information bearing upon its making. So long as the administrative decisions concerning the non-disclosure of that information are valid, an ASA may be made, and the rights of a visa holder to enter and remain in Australia may be cancelled, on the basis that such information must not be disclosed to the subject of an ASA. Any claim by a visa holder to vindicate his or her rights as such must necessarily proceed subject to the prohibition on disclosure of security-sensitive information. The application to the Tribunal As noted above, the appellant sought review of the merits of the ASA decision by the Tribunal pursuant to s 54 of the ASIO Act28. Pursuant to ss 39A and 39B of the AAT Act, the review was conducted in the Security Division of the Tribunal constituted by two Deputy Presidents and a Senior Member. The appellant was subsequently furnished with a revised statement of grounds, in consequence of a partial revoking of the public interest non-disclosure certificate upon the grounds that certain information was no longer prejudicial to security. This statement recorded that the appellant: had support for politically motivated violence and ISIL; and employed communications security tradecraft practices while engaging with individuals of security concern, including Syria-based individuals affiliated with ISIL29. In relation to the appellant's alleged support for politically motivated violence and ISIL, the revised statement of grounds recorded that the appellant had said in interviews that he had never supported or been affiliated with any group in the Syria/Iraq conflict, including ISIL. ASIO's assessment was that these statements were likely to have involved untruthful answers, because the appellant believed it would have had an adverse effect on his citizenship application or his ability to continue to hold his visa30. 27 SDCV v Director-General of Security (2021) 284 FCR 357 at 371 [50]. 28 SDCV v Director-General of Security (2021) 284 FCR 357 at 371 [52]. 29 SDCV v Director-General of Security (2021) 284 FCR 357 at 371-372 [53]. 30 SDCV v Director-General of Security (2021) 284 FCR 357 at 372 [57]. In relation to the appellant's alleged employment of communications security tradecraft practices while engaging with individuals of security concern, the revised statement of grounds recorded that the appellant was found: to have used a covert phone obtained specifically to communicate with his brother based in Syria, using an encrypted messaging app; also to have used that covert phone to communicate with a relative who was an ISIL leadership figure and to communicate with Australian-based family members of security interest who had been convicted of very serious offences (as noted above, the appellant was not found to have been involved in those offences); to have disposed of that covert phone, as the appellant said he had done when interviewed by ASIO, because of fears that he may have done something illegal by using it; and to have provided inaccurate information to ASIO about the existence, use and disposal of the covert phone, and that this demonstrated a heightened security awareness which indicated that the communications were likely of security concern31. As noted above, the appellant's application to the Tribunal was unsuccessful. The Tribunal's "open" reasons record that it was not able to be satisfied whether the ASA decision was justified on the evidence led in open session, but that it was so satisfied based upon the evidence before it in the closed session32. The legislative framework for the proceedings in the Tribunal Section 37(5) of the ASIO Act provides that no proceedings, other than an application to the Tribunal under s 54, shall be brought in any court or tribunal in respect of the making of a security assessment, including an ASA, or anything done in respect of a security assessment in accordance with the ASIO Act. Such a review is conducted in the Security Division of the Tribunal in accordance with ss 39A and 39B of the AAT Act. 31 SDCV v Director-General of Security (2021) 284 FCR 357 at 372-373 [58]. 32 SDCV and Director-General of Security [2019] AATA 6112 at [19]-[20]. Pursuant to s 39A(3) of the AAT Act, the Director-General is obliged to present to the Tribunal all relevant information available to the Director-General, whether favourable or unfavourable to an applicant. Section 39A(6) of the AAT Act provides that, subject to s 39A(9), an applicant and a person representing an applicant may be present when the Tribunal is hearing submissions made or evidence adduced by, relevantly, the Director-General. Section 39A(8) of the AAT Act provides that the ASIO Minister may, by signed writing, certify that evidence proposed to be adduced or submissions proposed to be made by or on behalf of, relevantly, the Director-General are "of such a nature that the disclosure of the evidence or submissions would be contrary to the public interest because it would prejudice security or the defence of Australia". Section 39A(9) provides that, if such a certificate is given, an applicant "must not be present when the evidence is adduced or the submissions are made"; and "a person representing the applicant must not be present when the evidence is adduced or the submissions are made unless the ASIO Minister consents". If a person representing an applicant is present when such evidence is adduced or such submissions are made, it is an offence for the representative to disclose any such evidence or submission to the applicant or to any other person, punishable by two years' imprisonment33. The Tribunal must first hear evidence adduced and submissions made by, relevantly, the Director-General. The Tribunal must next permit an applicant, if he or she so desires, to adduce evidence before, and make submissions to, the Tribunal34. Section 39B of the AAT Act applies to a proceeding in the Security Division to which s 39A applies35. Section 39B(2)(a) provides that if the ASIO Minister certifies, by signed writing, that the disclosure of information with respect to a matter stated in the certificate, or the disclosure of the contents of a document, would be contrary to the public interest "because it would prejudice security or the defence or international relations of Australia", the remaining provisions of s 39B have effect. In this regard, s 39B(3) provides that where information has been disclosed or documents have been produced to the Tribunal for the purposes of a proceeding, the Tribunal "must, subject to subsections (4), (5) and (7) and 33 s 39A(10) of the AAT Act. 34 s 39A(12), (13) of the AAT Act. 35 s 39B(1) of the AAT Act. section 46, do all things necessary to ensure", relevantly, "that the information or the contents of the document are not disclosed to anyone other than a member of the Tribunal as constituted for the purposes of the proceeding". Section 39B(7) of the AAT Act provides that s 39B does not prevent the disclosure of information or of the contents of a document to a member of the Tribunal's staff in the performance of his or her duties as a member of the Tribunal's staff. Section 39B(8) of the AAT Act provides that s 39B excludes the operation, apart from s 39B, of any rules of law relating to the public interest that would otherwise apply in relation to the disclosure of information or of the contents of documents in a proceeding. Section 39B(11) of the AAT Act further provides that it is the duty of the Tribunal, even though there may be no relevant certificate under s 39B, to ensure, so far as it is able to do so, that, in or in connection with a proceeding, information is not communicated or made available to a person contrary to the requirements of security. Upon the conclusion of the Tribunal's review, it must make and record its findings in relation to the security assessment, and those findings may state the opinion of the Tribunal as to the correctness of, or justification for, any opinion, advice or information contained in the assessment36. The Tribunal must cause copies of its findings to be given to an applicant, the Director-General, the Commonwealth agency, State or authority of a State to which the assessment was given, and the ASIO Minister37. However, the Tribunal may direct that the whole or a particular part of its findings, so far as they relate to a matter that has not already been disclosed to an applicant, is not to be given to the applicant or to the Commonwealth agency, State or authority of a State to which the assessment was given38. The legislative framework for the proceedings in the Federal Court Section 44(1) of the AAT Act provides that a party to a proceeding before the Tribunal may appeal to the Federal Court, on a question of law, from any decision of the Tribunal in that proceeding. The Federal Court "shall hear and 36 s 43AAA(2) of the AAT Act. 37 s 43AAA(4) of the AAT Act. 38 s 43AAA(5) of the AAT Act. determine the appeal and may make such order as it thinks appropriate by reason of its decision"39. In particular, the Federal Court may make "an order affirming or setting aside the decision of the Tribunal and an order remitting the case to be heard and decided again ... by the Tribunal in accordance with the directions of the Court"40. The Federal Court may make findings of fact in certain circumstances41. For those purposes, the Federal Court may have regard to evidence given in the proceeding before the Tribunal, and may receive further evidence42. Section 46(1)(a) of the AAT Act provides relevantly that when an appeal is instituted in the Federal Court in accordance with s 44: "the Tribunal shall, despite subsections 36(2), 36B(2) and 39B(3) of this Act, ... cause to be sent to the Court all documents that were before the Tribunal in connexion with the proceeding to which the appeal ... relates and are relevant to the appeal". Section 46(2) of the AAT Act provides relevantly: "If there is in force in respect of any of the documents a certificate in accordance with subsection 28(2), 36(1), 36B(1) or 39B(2) of this Act ... certifying that the disclosure of matter contained in the document would be contrary to the public interest, the Federal Court of Australia ... shall, subject to subsection (3), do all things necessary to ensure that the matter is not disclosed to any person other than a member of the court as constituted for the purposes of the proceeding." In the course of the hearing of the appeal in this Court there was some discussion of whether s 46(1) and s 46(2) were merely machinery whereby the record of the proceedings in the Tribunal was transmitted to the Federal Court. It is not necessary to pursue this question further. It is sufficient to say that these provisions determined what material might be before the Federal Court and what material the appellant and his lawyers might see. As noted earlier, the Federal Court had before it the evidence and submissions that were before the Tribunal, 39 s 44(4) of the AAT Act. 40 s 44(5) of the AAT Act. 41 s 44(7) of the AAT Act. 42 s 44(8) of the AAT Act. from both the "open" and "closed" sessions, as well as the Tribunal's "open" and "closed" reasons43. Section 46(3) of the AAT Act provides relevantly: the certificate referred to in subsection (2) relating to matter contained in the document does not specify a reason referred to in paragraph 28(2)(a) or (b), 36(1)(a) or (b), 36B(1)(a), or 39B(2)(a) of this Act ... as the case may be; a question for decision by the Federal Court of Australia ... is whether the matter should be disclosed to some or all of the parties to the proceeding before the Tribunal in respect of which the appeal was instituted ...; and the court decides that the matter should be so disclosed; the court shall permit the part of the document in which the matter is contained to be inspected accordingly." Section 46(4) of the AAT Act provides that "[n]othing in [s 46] prevents the disclosure of information or of matter contained in a document to an officer of the court in the course of the performance of his or her duties as an officer of the court". The Federal Court In respect of the appellant's challenge to the validity of s 46(2) of the AAT Act before the Federal Court, his counsel argued that legislation providing for a determination by a Ch III court must, without exception, ensure that a person whose right or interest may finally be altered or determined by a court order has a fair opportunity to respond to the evidence on which that order might be based44. The Federal Court rejected that argument. Bromwich and Abraham JJ, with whom Rares J agreed45, proceeded on the basis that it was uncontroversial that Parliament cannot require a court within 43 SDCV v Director-General of Security (2021) 284 FCR 357 at 373 [64]. 44 SDCV v Director-General of Security (2021) 284 FCR 357 at 380 [86]. 45 SDCV v Director-General of Security (2021) 284 FCR 357 at 361 [1]. Ch III of the Constitution to exercise the judicial power of the Commonwealth in a manner that is inconsistent with the essential character of a court or with the nature of judicial power46. Their Honours stated that "it may be accepted that procedural fairness is an essential feature of a Ch III court"47. For their Honours, as for this Court, the question was "whether, taken as a whole, the Court's procedures avoid practical injustice"48. In this regard, their Honours noted that the only circumstance in which s 46(2) of the AAT Act applies is when an appeal is brought against a decision of the Tribunal on a question of law; the appellant did not suggest that he was, or should have been, entitled to the certificated matter either at the stage at which the administrative decision was made by the Director-General, or at the stage of merits review in the Tribunal49. Their Honours also noted that they were not concerned with a case where the impugned legislation allowed a party to move the Court for an order which affected or altered the rights or interests of a person on the basis of evidence which was not available to the person affected by the order because of public interest and national security issues50. Bromwich and Abraham JJ said that the Commonwealth Parliament may validly create a regime in which, for good reason, the court may have access to information that a party affected may not. Their Honours noted that this Court has, on numerous occasions, upheld the validity of legislation which had that very consequence51. In their Honours' view, s 46 of the AAT Act could be described, as 46 SDCV v Director-General of Security (2021) 284 FCR 357 at 380 [84], citing Chu Kheng Lim v Minister for Immigration, Local Government and Ethnic Affairs (1992) 176 CLR 1 at 27. 47 SDCV v Director-General of Security (2021) 284 FCR 357 at 380 [84], citing Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 71 [67], 99 [156], 105 [177], 48 SDCV v Director-General of Security (2021) 284 FCR 357 at 380 [85], citing Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 100 [157]. 49 SDCV v Director-General of Security (2021) 284 FCR 357 at 392 [140]. 50 SDCV v Director-General of Security (2021) 284 FCR 357 at 392 [141]. 51 SDCV v Director-General of Security (2021) 284 FCR 357 at 393 [148]-[149], citing Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532, K-Generation Pty Ltd v Liquor Licensing Court (2009) 237 CLR 501 and South Australia v Totani (2010) 242 CLR 1. See also Graham v Minister for Immigration and Border Protection (2017) 263 CLR 1 at 31-32 [62]. the legislation was in those decisions, as having "an outcome comparable with that of the common law respecting public interest immunity, but with the difference that the Court itself may make use of the information"52. Their Honours also reasoned that when assessing the validity of s 46(2) of the AAT Act and whether there is a practical injustice, one must do so against the background of the legislative scheme as a whole and the counterfactual situation – that is, the position if s 46(2) did not exist53. In relation to these considerations, "It is plain that the regime involves significant modifications of the requirements of procedural fairness. That said, the regime is rather nuanced, with different categories of material being addressed according to the basis of the certification, with only the core categories of public interest immunity falling within the mandated non-disclosure. This is in the context where the regime provides that all the material is to be provided to the Tribunal, favourable and unfavourable, and that that material is to be before the Court on appeal. The Court can take that material into account in considering the appeal, albeit without submissions on it from the appellant, he or she having not seen the material. In respect to any submissions on the material by the respondent, either in writing or orally in closed court, it is to be expected that the obligations of the type that apply in ex parte hearings, in addition to the respondent's model litigant obligations, would apply. This is to be contrasted with what would occur in such a situation absent s 46(2), in the context of this regime. The material before the decision-maker would not be before the Court on any appeal. Such material could be the subject of a subpoena, but inevitably there would be a public interest immunity claim and where those claims are made and supported by cogent material, the claim would ordinarily or likely succeed". 52 SDCV v Director-General of Security (2021) 284 FCR 357 at 393 [149], quoting Graham v Minister for Immigration and Border Protection (2017) 263 CLR 1 at 31-32 [62], referring to Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532. 53 SDCV v Director-General of Security (2021) 284 FCR 357 at 394 [154]. 54 SDCV v Director-General of Security (2021) 284 FCR 357 at 396 [161]-[162], citing Plaintiff M46 of 2013 v Minister for Immigration and Border Protection (2014) 139 ALD 277 at 282-284 [26]-[30] and Sagar v O'Sullivan (2011) 193 FCR Their Honours concluded that if the Federal Court were not provided with the certificated matter pursuant to s 46, the appellant "would likely be in a worse position than he is now"55. Their Honours explained56: "Absent the provision for a merits review, the only challenge would be by way of judicial review of the ASA, which would occur without access to the material upon which the decision was based. The material before the decision-maker may be subpoenaed, but if there was a successful claim of public interest immunity, that material would not be before the Court. For the reasons set out above, in the context where the material relates to national security, it can safely be assumed that any claim of public interest immunity would have significant prospects of success. When regard is had to the regime considered as a whole, and the context in which s 46(2) exists, it cannot be contended that an appellant having appealed by way of s 44 from the decision of the Tribunal has suffered a practical injustice such that s 46(2) is invalid." The appellant's argument in this Court It was common ground in this Court, as it was in the Federal Court57, that Parliament cannot require a court within Ch III of the Constitution to exercise the judicial power of the Commonwealth in a manner inconsistent with the character of a court or the nature of judicial power. It was also common ground that procedural fairness is an essential feature of a Ch III court and that, as was said by the plurality in Condon v Pompano Pty Ltd58, the ultimate question is "whether, taken as a whole, the court's procedures for resolving the dispute accord both parties procedural fairness and avoid 'practical injustice'". The appellant submitted that a law that requires a court to adopt an unfair procedure infringes the limitation identified by Brennan, Deane and Dawson JJ in Chu Kheng Lim v Minister for Immigration, Local Government and Ethnic Affairs59 that Ch III of the Constitution precludes the enactment of a law that requires or authorises a court to exercise the judicial power of the Commonwealth 55 SDCV v Director-General of Security (2021) 284 FCR 357 at 396 [165]. 56 SDCV v Director-General of Security (2021) 284 FCR 357 at 396-397 [166]-[167]. 57 SDCV v Director-General of Security (2021) 284 FCR 357 at 380 [84]-[85]. (2013) 252 CLR 38 at 100 [157]. (1992) 176 CLR 1 at 27. "in a manner which is inconsistent with the essential character of a court or with the nature of judicial power". The appellant, while acknowledging that the requirements of procedural fairness are not fixed, argued that there is a "minimum requirement" of procedural fairness such that, if a court is to make an "order that finally alters or determines a right or legally protected interest of a person", the court must afford to that person "a fair opportunity to respond to evidence on which that order might be made"60. The appellant submitted that that opportunity may be afforded in different ways, namely allowing the affected person to be given the "gist" of the evidence, to have special advocates appointed to represent a person's interests, or both, as a means to achieve the necessary minimum requirement of procedural fairness. The critical divergence between the appellant and the respondents is that the respondents argued that the "minimum requirement" of an opportunity to know and respond to adverse material before the Federal Court, insisted upon by the appellant, is not invariably required to prevent practical injustice in an appeal under s 44 of the AAT Act from the Tribunal to the Federal Court. Practical injustice and a "minimum requirement" As to the appellant's reliance upon Chu Kheng Lim as the foundation of his argument, it is to be noted that the passage from Chu Kheng Lim quoted above focussed upon the exclusivity of the constitutional function of Ch III courts to adjudge and punish criminal guilt. That passage was a step in the reasoning to the conclusion that Ch III "precludes the enactment ... of any law purporting to vest any part of that function [namely the adjudgment and punishment of criminal guilt] in the Commonwealth Executive"61. Chu Kheng Lim did not suggest that the content of procedural fairness, characteristic of a Ch III court, is fixed by a "minimum requirement"; and it cast no doubt on the proposition that the requirements of procedural fairness are "adaptable to the environment in which it is applied"62. Nor does any subsequent decision of this Court establish that there is a "minimum requirement" of procedural fairness applicable to all proceedings in a Ch III court. As will be seen, those statements of high authority are to the contrary. 60 Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 105 [177]. See also 108 [188]. 61 Chu Kheng Lim v Minister for Immigration, Local Government and Ethnic Affairs (1992) 176 CLR 1 at 27. 62 Pathan v Secretary of State for the Home Department [2020] 1 WLR 4506 at 4522 [55]; [2021] 2 All ER 761 at 777. See also Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 99-100 [156]-[157]. The question whether practical injustice may be caused to a litigant is not to be resolved by reference to fixed rules as to the "minimum requirement" of procedural fairness that apply in every case in which the judicial power of the Commonwealth is engaged. Whether practical injustice may be occasioned to a litigant depends upon the nature of the proceedings and the rights and interests at stake63. So, in the adjudgment and punishment of criminal guilt, a person's liberty may, speaking generally, be taken away only in judicial proceedings involving observance of all the procedural safeguards that attend a criminal trial; but there is no support in the decided cases for the view that the requirements of procedural fairness that attend a criminal trial are also guaranteed by Ch III in relation to an appeal to a court as an adjunct to a statutory regime under which statutory rights depend upon administrative decisions. Indeed, it is salutary to acknowledge that, as French CJ said in Pompano, even in a criminal proceeding, where the claim to the full gamut of procedural protections of the accused in the interest of fairness is at its strongest, the accused may be denied disclosure of information that may lead to the identification of an informant. In that regard, French CJ said64: "Procedural fairness, manifested in the requirements that the court be and appear to be impartial and that parties be heard by the court, is defined by practical judgments about its content and application which may vary according to the circumstances. Both the open court principle and the hearing rule may be qualified by public interest considerations such as the protection of sensitive information and the identities of vulnerable witnesses, including informants in criminal matters." And that may be so even where only the "gist" of the information is sought, because the gist of the information will often suffice to identify the informant65. Gypsy Jokers That practical judgments, legislative or judicial, about the content and application of procedural fairness may vary with the claim to consideration of matters of public interest is illustrated by this Court's decision in Gypsy Jokers Motorcycle Club Inc v Commissioner of Police66. In that case, the Corruption and Crime Commission Act 2003 (WA) ("the CCA") authorised the Commissioner of 63 Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 99-100 [156]-[157]. 64 Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 72 [68]. 65 R (Haralambous) v Crown Court at St Albans [2018] AC 236 at 273 [63]. (2008) 234 CLR 532. Police to issue a "fortification removal notice" in respect of premises67. Section 72(2) of the CCA provided that the Commissioner could not issue such a notice unless the Commissioner "reasonably believe[d]" that the premises were "heavily fortified" and "habitually used as a place of resort by members of a class of people a significant number of whom may reasonably be suspected to be involved in organised crime"68. Section 76 of the CCA conferred on the Supreme Court of Western Australia a power to review whether the Commissioner could have reasonably held the belief required by s 72(2) when issuing the fortification removal notice69. The impugned provision was s 76(2), which stated70: "The Commissioner of Police may identify any information provided to the court for the purposes of the review as confidential if its disclosure might prejudice the operations of the Commissioner of Police, and information so identified is for the court's use only and is not to be disclosed to any other person, whether or not a party to the proceedings, or publicly disclosed in any way." The plurality (Gummow, Hayne, Heydon and Kiefel JJ) rejected the challenge to the validity of s 76(2) on the basis that, on its proper construction, it did not render unexaminable by the Supreme Court the decision of the Commissioner71, noting that the legislative regime had "an outcome comparable with that of the common law respecting public interest immunity, but with the difference that the Court itself may make use of the information in question"72. 67 Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532 68 Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532 69 Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532 70 Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532 71 Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532 72 Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532 Crennan J, with whom Gleeson CJ agreed73, came to the same conclusion74 and also considered an argument advanced on behalf of the appellant that the procedure established by s 76(2), whereby information identified as confidential by the Commissioner could not be disclosed to an applicant for judicial review, constituted a denial of procedural fairness75. Crennan J said76: "The appellant's particular complaints alleging a want of procedural fairness were that it did not have access to material adverse to it and the Court was deprived of the benefit of its submissions on such material. Parliament can validly legislate to exclude or modify the rules of procedural fairness provided there is 'sufficient indication'77 that 'they are excluded by plain words of necessary intendment'78. Whether the obligation to accord procedural fairness is satisfied will always depend on all the circumstances. For example, in a joint judgment of five members of this Court in Applicant VEAL of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs79, it was recognised, by reference to Sankey v Whitlam80 and Alister 73 Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532 74 Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532 75 Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532 76 Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532 77 Commissioner of Police v Tanos (1958) 98 CLR 383 at 396. 78 Annetts v McCann (1990) 170 CLR 596 at 598; Jarratt v Commissioner of Police (NSW) (2005) 224 CLR 44 at 56 [24]. (2005) 225 CLR 88. (1978) 142 CLR 1. v The Queen81, that courts 'mould their procedures to accommodate what has become known as public interest immunity'82. The statutory modification of procedural fairness achieved by s 76(2) (including any effect on the giving of reasons) is indistinguishable from the modification of procedural fairness which can arise from the application of the principles of public interest immunity." This passage recognises that the balancing exercise undertaken by the legislature in its determination of the requirements of procedural fairness is no less legitimate than the balancing exercises conducted in the exercise of judicial power. Of this passage in Gypsy Jokers, the plurality in Pompano said83: "The plurality [in Gypsy Jokers] said nothing to indicate that s 76(2), by allowing only the Court to have access to the confidential information, might, on that account, be of doubtful validity. Rather, the plurality's conclusion in Gypsy Jokers proceeded from an acceptance that, as Crennan J rightly pointed out, 'Parliament can validly legislate to exclude or modify the rules of procedural fairness'." True it is that Gypsy Jokers was concerned with State legislation, and was decided on the basis of the principles in Kable v Director of Public Prosecutions (NSW)84, whereas the impugned legislation here is a Commonwealth law and no reference to Kable is necessary to explain why the implications of Ch III of the Constitution are engaged. But there is no principled basis to distinguish between State and federal courts as components of the federal judicature in relation to their institutional obligations to accord procedural fairness. The Kable doctrine is derived from the requirement of Ch III that State courts must conform to the description of a court in Ch III in order to fulfil their role as potential repositories of federal jurisdiction and as part of the integrated court system in Australia; and as Gaudron J said in Kable, "there is nothing anywhere in the Constitution to suggest that it permits of different grades or qualities of justice, (1984) 154 CLR 404. 82 Applicant VEAL of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs (2005) 225 CLR 88 at 98 [24]. (2013) 252 CLR 38 at 98 [152] (footnote omitted). (1996) 189 CLR 51. depending on whether judicial power is exercised by State courts or federal courts created by the Parliament"85. It may be noted that s 46(2) of the AAT Act applies only when there is in force a valid certificate in accordance with, relevantly, s 39B(2) of the AAT Act. In Hussain v Minister for Foreign Affairs86, Sagar v O'Sullivan87 and Traljesic v Attorney-General (Cth)88 it was recognised that a person adversely affected by an ASA is entitled to seek judicial review of the decision to issue such a certificate. The appellant did not seek to challenge the validity of the ASIO Minister's certificates issued under s 39A(8) or s 39B(2) in the Federal Court or otherwise89. In addition, as Bromwich and Abraham JJ observed90, the appellant could have argued before the Tribunal that the certificates of the ASIO Minister were invalid as an improper exercise of an administrative discretion, and that, accordingly, ss 39A and 39B were not applicable to the review before the Tribunal. The circumstance that a person in the position of the appellant may test the validity of a certificate of the ASIO Minister in any of these ways forecloses one argument that might have been advanced, but was not pursued in this Court, against the validity of s 46(2)91. That argument might have been to the effect that legislation which purported to direct the courts as to the manner and outcome of the exercise of their jurisdiction would be apt impermissibly to impair the character of the courts as independent and impartial tribunals92. Section 46 of the AAT Act does not purport to direct the Federal Court to act upon an unexaminable opinion of the ASIO Minister as to whether disclosure of certificated matter would be 85 Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51 at 103. (2008) 169 FCR 241 at 258 [47]-[49]. (2011) 193 FCR 311 at 312 [1]. (2006) 150 FCR 199. See also Plaintiff M47/2012 v Director-General of Security (2012) 251 CLR 1 at 146 [376]; Minister for Immigration and Border Protection v SZMTA (2019) 264 CLR 421 at 438 [18]. 89 SDCV v Director-General of Security (2021) 284 FCR 357 at 377 [71]. 90 SDCV v Director-General of Security (2021) 284 FCR 357 at 377 [72]. 91 See Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 92 See Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR contrary to the public interest because, relevantly, it would prejudice security or the defence or international relations of Australia93. But where there is no challenge to the decision to issue a certificate, no question can arise as to the lawfulness of the denial of disclosure to a person in the position of the appellant of security-sensitive information (at the time of the making of an ASA) or certificated matter (at the review before the Tribunal). The bringing of an appeal to the Federal Court does not change that state of affairs. HT v The Queen Before the Federal Court, the appellant relied "heavily"94 on a passage from this Court's decision in HT v The Queen95. In that case, the issue was whether the appellant, who was a police informer, was denied procedural fairness in a Crown appeal against sentence because confidential evidence about her assistance to the police was provided by the Crown to the sentencing judge and the Court of Criminal Appeal of New South Wales, but was not seen by the appellant or her legal representatives96. All members of this Court held that the appellant was denied procedural fairness97. Before the Federal Court98, and in this Court, the appellant relied, in particular, on the following passage from the judgment of Kiefel CJ, Bell and Keane JJ99: "It is a fundamental principle of our system of justice that all courts, whether superior or inferior, are obliged to accord procedural fairness to parties to a proceeding100. This obligation requires not only that courts be open and judges impartial but that the person against whom a claim or charge is made be given a reasonable opportunity of being heard, which is 93 cf Kirk v Industrial Court (NSW) (2010) 239 CLR 531 at 579-581 [95]-[99]. 94 SDCV v Director-General of Security (2021) 284 FCR 357 at 391 [136]. (2019) 269 CLR 403. 96 HT v The Queen (2019) 269 CLR 403 at 412 [2], 413 [4], 414 [9], 415 [10]. 97 HT v The Queen (2019) 269 CLR 403 at 419 [27], 426 [55], 430-431 [66]. 98 SDCV v Director-General of Security (2021) 284 FCR 357 at 378 [75]-[76]. 99 HT v The Queen (2019) 269 CLR 403 at 416 [17]. 100 Cameron v Cole (1944) 68 CLR 571 at 589; Commissioner of Police v Tanos (1958) 98 CLR 383 at 395-396; Taylor v Taylor (1979) 143 CLR 1 at 4; Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 99 [156]. to say appearing and presenting his or her case101. In an adversarial system it is assumed, as a general rule, that opposing parties will know what case an opposite party seeks to make and how that party seeks to make it102. A party can only be in a position to put his or her case if the party is able to test and respond to the evidence on which an order is sought to be made103." The appellant's reliance on this passage as support for his argument was misconceived. HT was concerned with the legitimacy of a departure by a court from the general principles of procedural fairness applicable to criminal proceedings within the adversarial system. HT was not concerned with any question as to the limit of legislative power to enact measures that may curtail the familiar incidents of any other type of hearing, much less with the legitimacy of measures intended to accommodate national security considerations that would be compromised by full disclosure. There is nothing in the passage cited to suggest otherwise. Similarly, in relation to the appellant's reliance upon remarks, apparently helpful to his argument, in the decision of the Supreme Court of the United Kingdom in Al Rawi v Security Service104 by Lord Kerr of Tonaghmore JSC, his Lordship was not concerned with the limits of legislative power to modify the principles of procedural fairness. As French CJ noted in Pompano, in Al Rawi the Supreme Court was addressing the limits of the inherent power of a trial court in the exercise of civil accommodate public interest immunity claims at common law105. French CJ went on to observe that Al Rawi did not provide an answer to the constitutional question as to the validity of the legislation under challenge in Pompano106. to develop procedural innovations jurisdiction 101 Cameron v Cole (1944) 68 CLR 571 at 589; Taylor v Taylor (1979) 143 CLR 1 at 4. 102 Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 100 [157]. 103 Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 359 [56]; International Finance Trust Co Ltd v New South Wales Crime Commission (2009) 240 CLR 319 at 348 [39]; Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 105 [177], 108 [188]. 104 [2012] 1 AC 531 at 592-593 [91], [93]. 105 Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 63 [47]. 106 Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 64 [49]. Finally altering or determining rights In support of the appellant's contention that the denial by s 46(2) of the AAT Act of an opportunity to know and respond to evidence adverse to him is inconsistent with Ch III of the Constitution, the appellant relied principally upon dicta of Gageler J in Pompano. There his Honour stated107: "My view, in short, is that Ch III of the Constitution mandates the observance of procedural fairness as an immutable characteristic of a Supreme Court and of every other court in Australia. Procedural fairness has a variable content but admits of no exceptions. A court cannot be required by statute to adopt a procedure that is unfair. A procedure is unfair if it has the capacity to result in the court making an order that finally alters or determines a right or legally protected interest of a person without affording that person a fair opportunity to respond to evidence on which that order might be made." This statement was made in relation to legislation which affected property rights and individual liberty108. His Honour, in speaking of legislation that might "result in the court making an order that finally alters or determines a right or legally protected interest of a person", was not speaking of procedural rights whereby a right or legally protected interest, much less a wholly statutory right, might be vindicated. Rather, his Honour was concerned with the loss of rights or legally protected interests that cannot be determined other than fairly by judicial proceedings. The point is that this passage cannot be understood as supporting the notion that full disclosure of adverse material is mandated merely by the conferral of a right of appeal. In any event, it should be noted that the view expressed by Gageler J did not command the support of the other members of the Court in Pompano; and that this view has not, before or since, garnered the support of a majority of this Court. This Court's decision in Pompano involved consideration of the principles stated in Kable. The plurality, in rejecting the argument for the invalidity of the legislation challenged in that case, said109: 107 Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 105 [177]. See also 108 [188], 108 Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 48 [7]. 109 Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 99-100 [156]-[157]. "The rules of procedural fairness do not have immutably fixed content. As Gleeson CJ rightly observed110 in the context of administrative decision-making but in terms which have more general and immediate application, '[f]airness is not an abstract concept. It is essentially practical. Whether one talks in terms of procedural fairness or natural justice, the concern of the law is to avoid practical injustice'. To observe that procedural fairness is an essential attribute of a court's procedures is descriptively accurate but application of the observation requires close analysis of all aspects of those procedures and the legislation and rules governing them111. Consideration of other judicial systems may be taken to demonstrate that it cannot be assumed that an adversarial system of adjudication is the only fair means of resolving disputes. But if an adversarial system is followed, that system assumes, as a general rule, that opposing parties will know what case an opposite party seeks to make and how that party seeks to make it. As the trade secrets cases show, however, the general rule is not absolute. There are circumstances in which competing interests compel some qualification to its application. And, if legislation provides for novel procedures which depart from the general rule described, the question is whether, taken as a whole, the court's procedures for resolving the dispute accord both parties procedural fairness and avoid 'practical injustice'." (emphasis in original) This passage makes the important point, uncontradicted by any decision of this Court, that the question whether legislative alteration of the rules of procedural fairness is apt to cause practical injustice in any particular proceeding is not to be resolved on the basis that Ch III mandates adherence to the adversarial system of litigation, much less to all the incidents familiar within that system. It has never been suggested that the Constitution denies the legitimacy of legislative curtailment of disclosure in litigation involving trade secrets or confidential information, or the protection of children, or informants in criminal cases. That being so, there is no reason to complicate the analysis of whether the prescription of a particular procedure occasions practical injustice by asking whether the proceeding is adversarial and then asking what the adversarial system requires. One may simply ask the question whether, having regard to "all aspects of [a 110 Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam (2003) 214 CLR 1 at 14 [37]. 111 See, eg, RCB v Justice Forrest (2012) 247 CLR 304. court's] procedures and the legislation and rules governing them"112, the impugned legislation is an occasion of practical injustice. The passage from the plurality in Pompano also directs attention to the need for consideration of the rights and interests of the appellant at stake in an appeal under s 44 of the AAT Act from the Security Division of the Tribunal. To a consideration of those rights one may now turn. The appellant's rights The appellant is a non-citizen. His rights to enter and remain in Australia depend on his holding a valid visa under the Migration Act113. Other statutory provisions circumscribe those rights: in particular, the appellant was liable to have his visa cancelled under s 501(3) of the Migration Act in consequence of the making of an ASA under the ASIO Act114. Any entitlement of the appellant to disclosure of information with respect to an ASA was statutory; under statute, it could be denied by decisions of officers of the executive government where those officers considered that the public interest in Australia's security required non-disclosure of that information115. It is undisputed that, apart from s 46(2) of the AAT Act, the denial of disclosure to the appellant of security-sensitive information, including the certificated matter, was effected lawfully. And that was so irrespective of any challenge to the validity of the ASA decision and of the outcome of that challenge. The appellant's rights were always circumscribed by the denial of disclosure of security-sensitive information pursuant to unchallenged administrative decisions made under unchallenged laws. The statutory provisions that allowed the appellant to challenge the ASA decision in the Tribunal maintained that state of affairs in consequence of the certificates issued by the ASIO Minister under the AAT Act. The right of appeal to the Federal Court is itself a creature of statute. On the appellant's appeal under s 44 of the AAT Act, s 46(2) maintained the position regarding non-disclosure of security-sensitive information relating to the ASA decision, while s 46(1) allowed the Federal Court to consider all of the material that was before the Tribunal in reviewing the ASA decision and which was relevant 112 Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 99 [156]. 113 Migration Act 1958 (Cth), s 42. 114 Migration Act 1958 (Cth), s 501(3)(c), (d), (6)(g); s 4 of the ASIO Act, definition of "security". 115 ss 37(2), 38(1), (2) of the ASIO Act. to the appeal. The Federal Court was thereby enabled to decide the appeal before it on the same material as that on which the Tribunal proceeded116. In considering the rights and interests of the appellant that were at stake in his appeal, it must be appreciated that he was, at all times, denied disclosure of the certificated matter by the laws regulating his presence in Australia. It may be observed that the statement by Gageler J in Pompano on which the appellant's argument relied presupposes that the rights the protection of which are at stake in the proceeding in question are different from the "right" to bring that proceeding. The unfairness which is to be avoided is the loss of those rights otherwise than by a fair judicial process. In the present case, the only right of the appellant that was relevantly at stake in the appeal to the Federal Court was his right to hold his visa or, more precisely, his right to hold his visa unless he had been the subject of a valid ASA117. The appellant's right to hold his visa free of the consequences of an erroneous ASA was subject to the qualification that an ASA was to be made with him having no access to security-sensitive information relating to the ASA. The lawfulness of that qualification upon the appellant's rights has not been challenged. The determination of the appeal without disclosure of the certificated matter reflected the substance of the appellant's rights to access that material, that is to say, that he was by law denied disclosure. The Federal Court's duty to "do all things necessary to ensure that the [certificated] matter is not disclosed to any person other than a member of the court as constituted for the purposes of the proceeding" meant that the appellant had no right to disclosure of security-sensitive information relating to the ASA decision; and whether he was entitled to hold his visa free of the consequences of an erroneous ASA was to be determined on that footing. The denial of an opportunity for the appellant to know the totality of information that justified the making of the ASA decision was an incident of the statutory regime under which the appellant was permitted lawfully to enter and remain in Australia. The statutory regime under which he was present in Australia as a visa holder denied him that information when the ASA decision was made. That was also the case before the Tribunal. There is no question that this state of affairs was lawfully imposed. Section 46(2) of the AAT Act maintained that state of affairs on the appeal to the Federal Court. 116 cf R (Haralambous) v Crown Court at St Albans [2018] AC 236 at 271 [57]. 117 Migration Act 1958 (Cth), s 501(3)(c), (d), (6)(g); s 4 of the ASIO Act, definition of "security". The appellant suffered no practical injustice in the determination of his appeal to the Federal Court without either him or his lawyers having access to the certificated matter. He suffered no loss of rights by reason of being denied full disclosure because his right to hold a visa unless he was the subject of a valid ASA was circumscribed by the requirement that he not be informed of security-sensitive information in relation to that decision. Indeed, it would be "productive potentially of injustice and absurdity" if the Federal Court were to allow the appeal and remit the matter for determination by the Tribunal "on a basis different from that which the [Tribunal] had quite rightly adopted and been required to adopt when first considering the matter"118. An additional remedy but no additional right The same conclusion may be reached by considering more closely the operation of s 46 of the AAT Act as a whole. The appellant attacked the reasoning of the Federal Court119 that s 46(2) did not cause practical injustice to the appellant because, if s 46(2) did not exist, the certificated matter would still have been covered by public interest immunity and so would have been unavailable to the Court. The appellant argued that, in the absence of s 46(2), if a claim for public interest immunity were upheld, the certificated matter would not be available to either party or to the Court. On that basis, the appellant would not be subject to the alleged forensic disadvantage of being denied the opportunity to know and respond to the certificated matter that was available to the Federal Court. The appellant's argument is flawed in its focus upon the operation of s 46(2) as if it has an operation independent of s 46(1). Had the appellant challenged the validity of the ASA decision by judicial review proceedings under s 75(v) of the Constitution or s 39B of the Judiciary Act immediately upon the making of that decision, there can be no doubt as a practical matter that those proceedings would have been heard and determined on the footing that the certificated matter could not be disclosed to the appellant for the purposes of those proceedings120. Nothing in the legislative regime which provided, validly, for the making of the ASA decision altered the position that the law required that the certificated matter not be disclosed to the appellant on appeal to the Federal Court. Section 46(2) of the AAT Act confirmed that this state of 118 See R (Haralambous) v Crown Court at St Albans [2018] AC 236 at 271 [57]. 119 SDCV v Director-General of Security (2021) 284 FCR 357 at 396-397 [162]-[167]. 120 See, eg, Sagar v O'Sullivan (2011) 193 FCR 311 at 313 [4]-[6]. affairs was not altered by the operation of s 46(1) in relation to an appeal under It is clear, as a matter of statutory construction, that s 46(2) of the AAT Act has no operation independently of s 46(1), and so one cannot begin to answer the question whether the determination of the appellant's appeal to the Federal Court involved practical injustice by focussing exclusively on s 46(2) as if it does. When one considers the operation of s 46 as a whole, it is readily apparent that it confers an additional remedy upon a person in the position of the appellant but does not alter the state of affairs under which that person is lawfully denied disclosure of security-sensitive information. As noted above, s 46 of the AAT Act applies to an appeal to the Federal Court under s 44, which provides an alternative to the constitutionally entrenched avenue of judicial review in s 75(v) of the Constitution121 and the further statutory avenue of judicial review under s 39B of the Judiciary Act122 as a means of challenge to an ASA. On one hand, pursuing one of those avenues would have avoided the procedural disadvantage identified by the appellant. On the other hand, neither of those avenues would have included the advantage assured to the appellant by s 46(1), in having the certificated matter placed before the Court. Without s 46(1), a person in the position of the appellant might struggle to make out the error for which he or she contends before the Federal Court123, especially in a case such as the appellant's where one of the asserted errors was that the Tribunal's decision was not open on the evidence before it. Section 46(1) thus provides a forensic benefit to a litigant in the position of the appellant. It cannot be supposed that, if this Court were to hold that Parliament may not validly call upon a Ch III court to entertain an appeal under s 44 of the AAT Act which is affected by s 46(2), it would follow that a person in the position of the appellant could proceed with the appeal free of the forensic "disadvantage" imposed by s 46(2) but with the forensic advantage of s 46(1). If s 46(2) is invalid by reason of its inconsistency with Ch III, then s 46 is invalid in its entirety. The provisions of s 46 cannot have been intended to operate otherwise than as a 121 Plaintiff M47/2012 v Director-General of Security (2012) 251 CLR 1 at 146 [376]. 122 Hussain v Minister for Foreign Affairs (2008) 169 FCR 241 at 258 [47]-[49]; Sagar v O'Sullivan (2011) 193 FCR 311 at 312 [1]. 123 Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532 at 556 [24]; Sagar v O'Sullivan (2011) 193 FCR 311 at 313 [4]-[6]. package: in this regard s 46(2) makes no sense at all without s 46(1). The courts have no power to engage in a rewriting of s 46 to alter its intended effect. If s 46 of the AAT Act were invalid in its entirety, it is, as a practical matter, distinctly unlikely that the Federal Court would ever be able to consider information precluded from disclosure by certificates issued by the ASIO Minister on an appeal under s 44. Public interest immunity could be expected to prevent the use of such information by the Federal Court. As a practical matter, it is safe to say that, in the appellant's case, there is no good reason to think that the certificated matter could have been disclosed to the Federal Court in the absence of s 46(1). The choice of an alternative avenue of challenge under s 75(v) of the Constitution or s 39B of the Judiciary Act would not have offered the forensic advantage provided by an appeal under s 44 of the AAT Act; but it would have obviated the forensic "disadvantage" that is said to be the basis of the appellant's argument in this Court. That being so, it is difficult to accept that the avoidable consequences of s 46(2) caused him any practical injustice. The appellant chose the remedy that carried the benefit of s 46(1) available only on the terms contained in s 46(2). That s 46 of the AAT Act stands or falls in its entirety highlights the artificiality of the appellant's complaint, and helps to demonstrate that s 46(2) was not apt to cause him any practical injustice in the determination of his appeal to the Federal Court. That is because the effect upon his appeal of the forensic consequences of s 46(2) cannot be considered separately from the forensic advantage conferred by s 46(1): one comes with the other. To the extent that the benefit of s 46(1) may be thought to outweigh the limitation imposed by s 46(2) so that a person in the position of the appellant chooses to pursue an appeal under s 44 rather than the other available avenues of challenge, no practical injustice is suffered. There is only the choice of a remedial procedure that is less advantageous for an appellant than it might have been, but, nevertheless, more advantageous for an appellant than the alternatives, none of which can sensibly be said to be practically unjust. Each alternative remedy is simply what the law provides, that being indisputably a matter for the Parliament. The choice of remedy was a matter for the appellant. Case-by-case decisions – by the court? The appellant argued that s 46(2) of the AAT Act operates impermissibly in a "blanket" fashion to deny an appellant information about the case against him or her, whereas cases involving trade secrets or confidential information proceed on a case-by-case analysis by a court of what fairness requires in the particular case before that court, with the appropriate procedure being moulded by the court itself. The appellant argued that, in considering a claim for public interest immunity, a court must, in each case, engage in a balancing exercise which takes into account both whether any harm would be done by the production of the documents, and whether the administration of justice would be frustrated or impaired if the documents were withheld124; in contrast, s 46(2) does not allow for this case-by-case balancing of competing interests by the Federal Court. Rather, the appellant argued, s 46(2) precludes the Court from tailoring an order to ensure "basic procedural fairness"125. The appellant's argument cannot be accepted. No decision of this Court supports a constitutional imperative that the balance of competing public interests in litigation must always be left to be struck on a case-by-case basis by a court. Indeed in Nicholas v The Queen126, this Court rejected the contention that "only the courts may determine what the public interest requires" in balancing competing considerations relating to the protection of the integrity of the court's processes and the pursuit of other objectives within legislative power127. Nor does Ch III give rise to a constitutional impediment to the Parliament deciding that s 46(2) of the AAT Act was necessary or appropriate to maintain the balance of the competing public interests struck by the provisions in the ASIO Act limiting the appellant's rights to disclosure of security-sensitive information. Disclosure of the information on which an ASA has been made, or even the "gist" of that information, is apt to enable the identification by the person the subject of an ASA of the sources of information adverse to his or her interests. Parliament was entitled to proceed on the basis that, given the security context in which that information is provided, the human sources of that information will be willing to co-operate with the authorities only on the basis of assurances that their identities, and the information that may identify them, would be kept confidential. 124 Alister v The Queen (1983) 154 CLR 404 at 412. 125 HT v The Queen (2019) 269 CLR 403 at 426 [52]. 126 (1998) 193 CLR 173. 127 Nicholas v The Queen (1998) 193 CLR 173 at 272 [233]. See also 197 [37], In Gypsy Jokers128, the plurality approved the following remarks of Deane J in Australian Broadcasting Commission v Parish129: "The results of an undue discounting of legitimate claims to confidentiality are likely to be both the deterrence of the subject from having recourse to courts of justice for the vindication of legal rights or the enforcement of criminal law and the discouragement of willing co-operation on the part of witnesses whose evidence is necessary to enable the ascertainment of truth. The interests of the administration of justice plainly make it desirable that obligations of confidence be not lightly overruled and that legitimate expectations of confidentiality as to private and confidential transactions and affairs be not lightly disregarded. In some cases, where publicity would destroy the subject matter of the litigation, the avoidance of prejudice to the administration of justice may make it imperative that the ordinary prima facie rule of open justice in the courtroom gives way to the overriding need for confidentiality." The exercise of judicial discretion to balance the public interest in open justice with the competing public interest in encouraging complainants and witnesses to come forward may require close consideration of the evidence by the court before which the proceedings are pending. But in the context of the administration of laws establishing the system of migration into this country, a systemic approach to the assessment of risks to national security within that system calls, reasonably and rationally, for the establishment of procedures for the making of ASAs by officers of the executive government who are in a position to give reliable assurances of confidentiality, backed by appropriate legislation, to persons who are potential sources of relevant information concerning immigrants. The systemic importance of maintaining the confidentiality assured by these provisions supports the conclusion that the reliability of assurances of confidentiality to sources of information should not be jeopardised on appeal from the Tribunal to the Federal Court by a "case-by-case" assessment by the Court. In D v National Society for the Prevention of Cruelty to Children130, Lord Simon of Glaisdale said: 128 Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532 129 (1980) 29 ALR 228 at 255. 130 [1978] AC 171 at 235. "The overriding rule is the general one that courts of law must recognise their limitations for decision-making – that there are many matters in which the decision is more appropriately made by the collective wisdom of Parliament on the advice of an executive (itself collective in a system of Cabinet government) briefed by officials who have investigated over a wide field the repercussions of the decision. Such, for example, are those decisions which may affect ... the public safety, in contradistinction to decisions where the court can feel reasonably confident that there are unlikely requiring extra-forensic action – for example, where the subject matter is 'lawyers' law': see, for example, Director of Public Prosecutions v Shannon131." to be unforeseen repercussions The primary responsibility for balancing the competing interests of open justice and national security in relation to immigration matters rests with the Parliament elected by the people and the executive government responsible to the Parliament132. Chapter III of the Constitution does not deny Parliament the power to recognise, and balance, the competing interests that rationally and reasonably bear upon the terms on which a person may seek to vindicate in a court a claim to enjoy rights conferred by statute which are susceptible to removal by administrative decisions authorised by statute. Striking the balance of competing public interests requires consideration of expert opinion, predictive assessments, and political and social evaluations, the making of which is legislative rather than judicial in character. Chapter III of the Constitution separates the judicial power of the Commonwealth from legislative power; it does not diminish the legislative power of the Parliament within its proper field. The integrity of the Federal Court The appellant argued that a court's institutional integrity hinges on its possessing, and maintaining, the essential characteristics that mark it apart from other decision-making bodies, and a law which purports to remove those characteristics altogether will therefore infringe the Chu Kheng Lim principle. Section 46(2) of the AAT Act does not require the Federal Court to act in a way that is inconsistent with the essential characteristics of a court. Chapter III of the Constitution precludes the imposition by the Parliament upon the courts of the federal judicature of the "grossly unjudicial chore" of determining an appeal by a process inconsistent with the due exercise of judicial power133; but the task of the 132 cf A v Hayden (1984) 156 CLR 532 at 548-549. 133 Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51 at 133. Federal Court under s 44 is not rendered unduly complex or difficult by s 46(2). Nor is the integrity of the Federal Court affected by s 46(2). In Graham v Minister for Immigration and Border Protection134, this Court was concerned with a challenge to the validity of s 503A(2) of the Migration Act. The effect of s 503A was that if a certain category of confidential information was communicated to the Minister for Immigration and Border Protection, the Minister could not be required to divulge or communicate that information to a court, a tribunal, a parliament or parliamentary committee, or any other body or person135. The plaintiff in Graham argued, relevantly, that s 503A(2) was invalid under Ch III of the Constitution on the basis that it required a federal court to exercise judicial power in a manner which was inconsistent with the essential character of a court or with the nature of judicial power136. In particular, the plaintiff submitted that it is an essential function of courts to find facts relevant to the determination of rights in issue, and that s 503A(2) prevented the courts from doing so, thereby constituting an impermissible interference with their function137. It is to be noted that the majority in Graham (Kiefel CJ, Bell, Gageler, Keane, Nettle and Gordon JJ) rejected that submission, holding that s 503A(2) was valid, except to the extent that s 503A(2)(c) operated to prevent the Minister for Immigration and Border Protection from being required to divulge or communicate information to this Court when exercising jurisdiction under s 75(v) of the Constitution, or to the Federal Court when exercising jurisdiction under s 476A(1)(c) and (2) of the Migration Act138. Importantly for present purposes, the majority in Graham recorded a submission by the parties defending the validity of the legislation that "as a matter of policy, it may be accepted that admissible evidence should be withheld only if and to the extent the public interest requires it, but that there is no constitutional 134 (2017) 263 CLR 1. 135 Graham v Minister for Immigration and Border Protection (2017) 263 CLR 1 136 Graham v Minister for Immigration and Border Protection (2017) 263 CLR 1 137 Graham v Minister for Immigration and Border Protection (2017) 263 CLR 1 138 Graham v Minister for Immigration and Border Protection (2017) 263 CLR 1 principle which requires the courts to be the arbiter of that question"139. Their Honours stated that this submission "should be accepted to the extent that the question of where the balance may lie in the public interest has never been said to be the exclusive preserve of the courts, nor has it ever been said that legislation may not affect that balance"140. Their Honours went on to observe that "[t]he fact that a gazetted agency and the Minister may control the disclosure of information does not affect the appearance of the court's impartiality"141. And so, in the instant case, the impartiality and independence of the Federal Court is not affected by the maintenance of the limitations on the appellant's entitlement to disclosure of the certificated matter. Partial invalidity The appellant advanced an alternative argument to the effect that s 46(2) of the AAT Act may be only partially invalid. This alternative argument proceeded on the basis that s 15A of the Acts Interpretation Act 1901 (Cth) requires s 46(2) to be read down to comply with the constitutional limitation. In this regard, it was argued on behalf of the appellant that s 46(2) should be read as if it provided to the effect that the Court "shall ... do all things necessary in the due exercise of judicial power to ensure that the [certificated] matter is not disclosed to any person ..."; the point being that, read in this way, s 46(2) would afford an appellant the minimum opportunity to know and respond to the evidence adverse to him or her, and s 46(2) would be valid. Alternatively, the appellant argued that any operation of s 46(2) that exceeds the constitutional limit be severed or disapplied. The argument concluded that if s 46(2) cannot be read down or disapplied, as the appellant suggested, then it is wholly invalid. The reading of the statutory text proposed by the appellant is not open. For good or ill, it is clear that the intention of s 46(2) of the AAT Act is to ensure that there be no disclosure of the certificated matter save as permitted by the other provisions of s 46. The terms of s 46 are clear beyond peradventure that the only 139 Graham v Minister for Immigration and Border Protection (2017) 263 CLR 1 140 Graham v Minister for Immigration and Border Protection (2017) 263 CLR 1 141 Graham v Minister for Immigration and Border Protection (2017) 263 CLR 1 exceptions to the express requirement of s 46(2) are expressly stated in the other provisions of s 46. It should also be said that s 46 of the AAT Act cannot be construed to allow the appointment of special counsel to whom the matter the subject of ministerial certificates might be disclosed. Section 46(4), which allows disclosure to an "officer of the court", does not contemplate the appointment of special counsel to whom disclosure of such matter might be made so as to overcome the effect of s 46(2). As Foster J rightly held in National Archives of Australia v Fernandes142, when one pays due regard to the objects and purposes of the AAT Act, and of s 46 in particular, one cannot understand the expression "officer of the court" in s 46(4) as including "any legal practitioner admitted to practice by an appropriate Court in Australia ... [T]he expression ... is meant to refer to public servants employed in the Court to assist the judges in the performance of their judicial function." In addition, the appointment of special counsel to represent a person in the position of the appellant, as urged on the appellant's behalf, would not resolve the practical consequences otherwise occasioned by s 46(2). As the plurality noted in Pompano, special counsel to whom the certificated material was disclosed "could not, without disclosing the existence or content of the information ... ask [the appellant] to comment on what the lawyer had been told. The lawyer could assemble no ammunition to launch an attack upon the veracity of a confidential source alleged to have provided [certificated matter] without disclosing that source's existence"143. Conclusion and orders The appellant was lawfully denied the right to know the totality of information which led to the making of the ASA decision under unchallenged laws and unchallenged administrative decisions directed to the preservation of confidentiality in the interests of national security. Section 46(2) of the AAT Act was consistent with the statutory provisions establishing the rights of the appellant to enter and remain in Australia. Moreover, s 46(2) did not affect the integrity of the Federal Court in the independent and impartial performance of its functions. An appeal under s 44 of the AAT Act, to which s 46 applies, is additional to the available remedies under s 75(v) of the Constitution or s 39B of the Judiciary Act. As a practical matter, any "disadvantage" to the appellant occasioned by s 46(2) would have been avoided by the choice of proceedings under these other 142 (2014) 233 FCR 461 at 468 [44]. 143 Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 100-101 [161]. remedies. But such a choice would have denied the appellant the forensic advantage offered by s 46(1) in having the certificated matter provided to the Court. Section 46(2) operated inseparably from s 46(1) to provide the appellant with forensic advantages different from those otherwise provided by law. The appellant, having chosen to pursue the remedy that afforded those advantages, suffered no practical injustice. The decision of the Federal Court was correct. The appeal to this Court should be dismissed. The appellant should pay the costs of the appeal to this Court. 104 The question in this appeal is of a kind which has arisen in numerous national jurisdictions on numerous occasions since the notorious events of 11 September 2001. To what extent is the ordinary principle that a party to litigation is entitled to know the evidence relied on against them capable of legislative modification in the interests of national security? Questions of that kind have been addressed in the United States under the rubric of the constitutional guarantee of "procedural due process"144. They have been addressed in Canada by reference to constitutionally enshrined "principles of fundamental justice"145. In the European Union146, and in the United Kingdom147, they have been addressed by reference to the human right to a "fair hearing". In Australia, a question of that kind engages Ch III of the Constitution. In particular, it engages the requirement of procedural fairness, which "lies at the heart of the judicial function"148. Procedural fairness is essential to the exercise of the judicial power of the Commonwealth149. Observance of procedural fairness is an essential characteristic of any "court" capable of being invested by the Commonwealth Parliament with the judicial power of the Commonwealth150. The precise question in the appeal is to be addressed within that constitutional frame of reference. The question concerns s 46(2) of the Administrative Appeals Tribunal Act 1975 (Cth) ("the AAT Act") in its application to a document containing information disclosure of which has been certified by the Minister administering the Australian Security Intelligence Organisation Act 1979 (Cth) ("the ASIO Minister") under s 39B(2)(a) of the AAT Act to be contrary to 144 The "due process" clause of the Fifth Amendment to the Constitution of the United States. Eg Hamdi v Rumsfeld (2004) 542 US 507. 145 Section 7 of the Canadian Charter of Rights and Freedoms. Eg Charkaoui v Canada (Citizenship and Immigration) [2007] 1 SCR 350; Canada (Citizenship and Immigration) v Harkat [2014] 2 SCR 33. 146 Article 6 of the Convention for the Protection of Human Rights and Fundamental Freedoms. Eg A v United Kingdom (2009) 49 EHRR 29. 147 Article 6 of Sch 1 to the Human Rights Act 1998 (UK). Eg Tariq v Home Office [2012] 1 AC 452; Al Rawi v Security Service [2012] 1 AC 531; R (Haralambous) v Crown Court at St Albans [2018] AC 236. 148 International Finance Trust Co Ltd v New South Wales Crime Commission (2009) 240 CLR 319 at 354 [54]. 149 See Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 359 [56]. 150 Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 71 [67], 99 [156], 105 [177]. the public interest "because it would prejudice security or the defence or international relations of Australia". The question is whether s 46(2), in that application, operates to require the Federal Court of Australia to adopt a procedure that is unfair when exercising the judicial power of the Commonwealth to hear and determine an appeal on a question of law from a decision of the Administrative Appeals Tribunal ("the AAT") under s 44 of the AAT Act. Section 46(2) of the AAT Act operates against the background of the general requirement of s 46(1). The general requirement is that, upon the institution of an appeal under s 44, the AAT must send to the Federal Court all documents that were before the AAT in connection with the proceeding to which the appeal relates and that are relevant to the appeal. Having been sent to the Federal Court, the documents remain within the custody and control of the Federal Court until the conclusion of the appeal, when the Federal Court must return them to the AAT. The documents in the meantime are available to the Federal Court, and ordinarily to the parties, in the conduct of the appeal so as to be able to be considered by the Federal Court in the determination of the appeal. Where triggered by the ASIO Minister's prior certification under s 39B(2)(a) of a document sent to the Federal Court by the AAT under s 46(1), s 46(2) requires that the Federal Court "do all things necessary to ensure that the [certified information] is not disclosed to any person other than a member of the court as constituted for the purposes of the proceeding". Disclosure "to an officer of the court in the course of the performance of his or her duties as an officer of the court" is specifically permitted by s 46(4). The requirement to ensure non- disclosure is otherwise unqualified. There may be some flexibility as to the means adopted. There is no flexibility as to the outcome to be achieved: the wholesale preclusion of disclosure of any part of the certified information to any other person, including any party to the appeal as well as any legal representative of any party to the appeal151. That blanket proscription of disclosure of certified information will not be a problem for a party to the appeal who is already aware of the certified information and is already aware that the certified information had been in a document before the AAT in connection with the proceeding to which the appeal relates. That party will have the benefit of knowing that the information will automatically be available to the Federal Court on the hearing of the appeal and will be able to tailor submissions on the appeal accordingly. Typically, that party will be a respondent before the Federal Court. Typically, that party will be an executive officer of the Commonwealth. Depending on the issues in the appeal and on the degree of relevance or perceived relevance of the certified information to the resolution of those issues, 151 National Archives of Australia v Fernandes (2014) 233 FCR 461 at 468 [44]. the blanket proscription may well be a problem for a party to the appeal who is unaware of the information. By force of the proscription, that party will never know the information despite it being able to be considered by the Federal Court in the determination of the appeal. Typically, that party will be an applicant before the Federal Court. Typically, that party will be an individual. My opinion is that the blanket proscription by s 46(2) of the AAT Act of disclosure of information certified under s 39B(2)(a) of the AAT Act renders the process by which the Federal Court is to hear and determine an appeal under s 44 of the AAT Act procedurally unfair. To explain that opinion, I will say something more about the nature of an appeal under s 44 of the AAT Act and about the parameters of the inquiry to be undertaken in considering whether s 46(2) renders the process by which the Federal Court is to hear and determine such an appeal procedurally unfair. I will address the minimum content of procedural fairness as an aspect of a judicial process. I will then explain, in a manner responsive to various arguments of the respondents and interveners, why s 46(2) results in the process by which the Federal Court is to hear and determine an appeal failing to meet that minimum content. The nature of an appeal under s 44 of the AAT Act The Commonwealth Parliament can invest the judicial power of the Commonwealth in the Federal Court only through the conferral under s 77(i) of the Constitution of federal jurisdiction with respect to a "matter" of a kind described in s 75 or s 76 of the Constitution. The constitutional term "matter" is broad152. The term encompasses subject-matters appropriate for the exercise of judicial power which do not involve a controversy about existing legal rights or obligations153. 152 Hobart International Airport Pty Ltd v Clarence City Council (2022) 96 ALJR 234 at 249 [46]; 399 ALR 214 at 227. 153 R v Davison (1954) 90 CLR 353 at 367-368; Secretary, Department of Health and Community Services v JWB (Marion's Case) (1992) 175 CLR 218 at 257; Wilson v Minister for Aboriginal and Torres Strait Islander Affairs (1996) 189 CLR 1 at 11 (footnote 39); Macedonian Orthodox Community Church St Petka Inc v His Eminence Petar Diocesan Bishop of Macedonian Orthodox Diocese of Australia and New Zealand (2008) 237 CLR 66 at 91 [64]; Palmer v Ayres (2017) 259 CLR That said, a controversy between parties about existing legal rights or obligations is the paradigm154. "The unique and essential function of the judicial power is the quelling of such controversies by ascertainment of the facts, by application of the law and by exercise, where appropriate, of judicial discretion."155 The federal jurisdiction conferred on the Federal Court by s 44 of the AAT Act to hear and determine an appeal on a question of law from a decision of the AAT is a conferral of judicial power to hear and determine a matter within that paradigm. Although styled an "appeal", the federal jurisdiction conferred is original jurisdiction156. The original jurisdiction is conferred under s 77(i) of the Constitution with respect to a matter arising under the AAT Act, being a matter of a kind described in s 76(ii) of the Constitution. The terms in which that original federal jurisdiction is legislatively conferred by s 44 of the AAT Act make plain that the jurisdiction is invoked by one party to a proceeding before the AAT (typically, an individual aggrieved by the primary decision which was reviewed by the AAT and in turn by the decision of the AAT on the review157) raising against another party to that same proceeding before the AAT (typically, the executive officer of the Commonwealth who made the primary decision which was reviewed by the AAT158) a controversy as to whether the decision made by the AAT on the review159 was materially affected by an error of law160. The duty of the Federal Court on the hearing and determination of the appeal161 is limited to resolving the controversy so raised, and the power of the Federal Court to make final orders in the appeal162 is limited to 154 See Huddart, Parker & Co Pty Ltd v Moorehead (1909) 8 CLR 330 at 357. 155 Fencott v Muller (1983) 152 CLR 570 at 608. See also Wilson v Minister for Aboriginal and Torres Strait Islander Affairs (1996) 189 CLR 1 at 11, 21-22. 156 Committee of Direction of Fruit Marketing v Australian Postal Commission (1980) 144 CLR 577 at 585. 157 See s 30(1)(a) of the AAT Act. 158 See s 30(1)(b) of the AAT Act. 159 Section 43 of the AAT Act. 160 Section 44(1) of the AAT Act. See Comptroller-General of Customs v Pharm-A- Care Laboratories Pty Ltd (2020) 270 CLR 494 at 513 [40]. 161 Section 44(3) of the AAT Act. 162 Section 44(4)-(5) of the AAT Act. the making of orders appropriate to reflect that resolution163. To facilitate performance of that duty and the exercise of that power, the Federal Court is given ancillary jurisdiction to find facts supplementary to those which were found by the AAT in making the decision under appeal164. But neither the principal jurisdiction to hear and determine the appeal nor the ancillary jurisdiction to find additional facts requires or permits the Federal Court to engage in a process that is directed to anything other than the quelling of the controversy between the parties before it about existing legal rights. Whether the Commonwealth Parliament could invest the Federal Court, or any other court, with federal jurisdiction to determine the lawfulness of an administrative decision made under Commonwealth legislation outside the paradigm of that court being called upon to quell a controversy between parties about existing legal rights is a large question. The question has not been argued and need not be resolved in order to answer the specific question in this appeal. Were the question ever squarely to arise for consideration, the impact of moving outside the paradigm on the independence of the judiciary underpinned by Ch III's separation of the judicial power of the Commonwealth would need to be examined. Within a constitutional system built on the understanding that "the absolute independence of the judiciary is the bulwark of the constitution against encroachment whether by the legislature or by the executive"165, the perception if not the actuality of judicial independence would be called into question were the function of a judge reviewing the legality of administrative action to merge into that of an auditor or an ombudsman. To adopt an observation made by Isaacs J in New South Wales v The Commonwealth166 and endorsed by the majority in R v Kirby; Ex parte Boilermakers' Society of Australia167, were a court to have an active duty to "watch the observance of ... laws, to insist on obedience to their mandates, and to take steps to vindicate them if need be", "its essential feature as an impartial tribunal would be gone, and the manifest aim and object of the constitutional separation of powers would be frustrated". 163 Minister for Immigration and Multicultural Affairs v Thiyagarajah (2000) 199 CLR 343 at 356-357 [34], quoting Minister for Immigration and Ethnic Affairs v Gungor (1982) 42 ALR 209 at 220. 164 Section 44(7)-(10) of the AAT Act. 165 Wilson v Minister for Aboriginal and Torres Strait Islander Affairs (1996) 189 CLR 1 at 13, quoting Attorney-General of the Commonwealth of Australia v The Queen (1957) 95 CLR 529 at 540; [1957] AC 288 at 315. 166 (1915) 20 CLR 54 at 93. 167 (1956) 94 CLR 254 at 271. The AAT, and the executive officer of the Commonwealth who made the primary decision reviewed by the AAT so as to become a party to the proceeding before the AAT, are situated by the AAT Act in an administrative continuum168. The administrative continuum ends with the AAT. The Federal Court is not part of it. The function performed by the Federal Court when hearing and determining an appeal under s 44 of the AAT Act is the quintessential judicial function of exercising judicial power to quell a controversy between the parties to an administrative process about the lawfulness of the resultant administrative decision. The judicial function performed by the Federal Court is adjudicative, not procuratorial. The judicial process engaged in by the Federal Court in the performance of that judicial function is adversarial, not inquisitorial. The need for procedural fairness within the judicial process That brings me to the parameters of the inquiry to be undertaken in considering whether s 46(2) of the AAT Act renders the process by which the Federal Court is to hear and determine an appeal under s 44 procedurally unfair. The respondents argue that a broad and pragmatic inquiry is warranted. They argue that s 46(2) cannot be divorced from s 46(1) and that s 46 cannot be considered in isolation from s 44. They say that the provisions together constitute a legislative package by means of which a peculiar statutory jurisdiction is conferred on the Federal Court with its own peculiar process. The respondents argue that it is the fairness of the package as a whole which needs to be assessed. They argue that the fairness of the package as a whole can only be assessed having regard to the alternatives available to a party seeking to challenge the lawfulness of a decision of the AAT. The respondents point out that, absent an appeal under s 44 of the AAT Act, a party to a proceeding before the AAT seeking to challenge the lawfulness of its decision would be relegated to applying for judicial review of the decision on the basis of jurisdictional error either in the original jurisdiction conferred on this Court by s 75(v) of the Constitution or in the equivalent original jurisdiction conferred on the Federal Court under s 77(i) of the Constitution by s 39B(1) of the Judiciary Act 1903 (Cth). On any application for judicial review, that party would bear the onus of proving the facts necessary to establish that the decision of the AAT is affected by jurisdictional error. To discharge that onus of proof, the party would be able to invoke the compulsory processes of the court to obtain production of the documents that had been before the AAT. An attempt by the party to do so would likely be met by a claim of public interest immunity if and to the extent that 168 Shi v Migration Agents Registration Authority (2008) 235 CLR 286 at 300-301 [45], quoting Jebb v Repatriation Commission (1988) 80 ALR 329 at 333-334. a document contained information disclosure of which might be considered by a responsible executive officer of the Commonwealth to prejudice security or the defence or international relations of Australia. That claim of public interest immunity from production would not inevitably be upheld by the court in whole or in part on a balancing of considerations. But to the extent the claim was upheld by the court, it would result in the document containing the information being withheld from the party and also from the court. Not only would the party be handicapped in discharging the onus of proof, but the court would "arrive at a decision on something less than the entirety of the relevant materials"169. The respondents go on to point out that the jurisdiction to hear and determine an appeal on a question of law legislatively conferred on the Federal Court by s 44 of the AAT Act is not confined to an error of law which has resulted in jurisdictional error. To that extent, the jurisdiction conferred by s 44 of the AAT Act is broader than the jurisdiction conferred by either s 75(v) of the Constitution or s 39B(1) of the Judiciary Act170. What is more, the respondents point out, a party invoking the additional jurisdiction conferred on the Federal Court by s 44 of the AAT Act is relieved of the need to invoke compulsory processes to obtain the production of documents and to run the gauntlet of a claim for public interest immunity. That is because s 46(1) ensures that all documents that were before the AAT and that are relevant to the appeal will automatically be available to the Federal Court on the hearing of the appeal. For that considerable procedural benefit, so the argument goes, the party pays the small price imposed by s 46(2). The price is that, if certified by the ASIO Minister under s 39B(2)(a), the information contained in those documents will not be disclosed to that party. Taking the downside of s 46(2) together with the upside of s 46(1), the respondents argue, a party to a proceeding before the AAT who wants to challenge the lawfulness of its decision is better off with an appeal under s 44 of the AAT Act than without an appeal under s 44 of the AAT Act. The party has not lost any right to challenge the lawfulness of the decision under s 75(v) of the Constitution or s 39B(1) of the Judiciary Act. The party has gained an additional and more expansive right to challenge the lawfulness of the decision by a dedicated streamlined process. Being no more than an incident of the process by which that additional and more expansive right to challenge the lawfulness of the decision is exercised, the respondents argue, the requirement of s 46(2) of the AAT Act occasions no "practical injustice". 169 Church of Scientology v Woodward (1982) 154 CLR 25 at 61. See eg Sagar v O'Sullivan (2011) 193 FCR 311. 170 Allan v Transurban City Link Ltd (2001) 208 CLR 167 at 172-173 [11]. I cannot accept that mode of analysis. The with-jurisdiction-and-without- jurisdiction comparison proffered by the respondents is to my mind beside the point. It can be no answer to an argument that a process required to be followed in the purported exercise of jurisdiction is unfair to say that something is better than nothing. Chapter III of the Constitution does not admit of "grades or qualities of justice"171. "The circumstance that [an institution] has been established by legislation as a court means that any jurisdiction conferred on it is necessarily conditioned by the requirement that it observe procedural fairness in the exercise of that jurisdiction."172 The Commonwealth Parliament is not constitutionally required to confer any federal jurisdiction on any court under s 76 or s 77 of the Constitution. But whatever federal jurisdiction it chooses to confer is constitutionally incapable of being exercised by a court other than in accordance with a judicial process. Procedural fairness is a requirement to be observed within a judicial process. At least where a matter with respect to which jurisdiction is conferred is within the paradigm of a controversy between parties about existing legal rights, procedural fairness requires that each party to the controversy be afforded a fair opportunity to be heard in the course of the judicial process by which that controversy gets resolved. That involves being afforded a fair opportunity to be heard in relation to the facts to be found, in relation to the ascertainment of the applicable law, and in relation to the application of that law to the facts. The expression "practical injustice" is appropriately used as a synonym for procedural unfairness173. What is important to bear in mind in using that synonym, however, is that the practical injustice referred to is procedural injustice. Gleeson CJ coined the expression in Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam174. His Honour there described a procedural irregularity in the process by which an administrative decision was 171 Wainohu v New South Wales (2011) 243 CLR 181 at 229 [105]. 172 Oakey Coal Action Alliance Inc v New Acland Coal Pty Ltd (2021) 95 ALJR 128 at 137 [47] (emphasis added); 386 ALR 212 at 222. 173 Eg Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 99-100 [156]-[157]; HT v The Queen (2019) 269 CLR 403 at 417 [18]. 174 (2003) 214 CLR 1 at 13-14 [37]. made as having occasioned no "practical injustice" in circumstances where "[t]he applicant lost no opportunity to advance his case"175. The content of procedural fairness within a judicial process More than half a century ago, in England, Upjohn LJ said176: "It seems to be fundamental to any judicial inquiry that a ... properly interested party must have the right to see all the information put before the judge, to comment on it, to challenge it and if needs be to combat it, and to try to establish by contrary evidence that it is wrong. It cannot be withheld from him in whole or in part. If it is so withheld and yet the judge takes such information into account in reaching his conclusion without disclosure to those parties who are properly and naturally vitally concerned, the proceedings cannot be described as judicial." That explanation of the content of procedural fairness in an adversarial judicial process within the common law tradition might here and now be said to be a purist view expressed in a less complicated age in a place where the term "judicial" bore no constitutional significance. The explanation might be said to have been an overstatement even then and there. Exigencies of national security and public safety in this century have prompted recognition of the historical truth that judges have in fact taken information undisclosed to one or more parties into account in reaching conclusions in a variety of atypical cases over a long period without the processes in which they have engaged having been thought unjudicial177. Nonetheless, the statement of Upjohn LJ reflects the historical norm and continues to reflect the institutional ideal. The statement encapsulates the standard method of application within a judicial process of a standard incident of procedural fairness. Expressed at a level of generality, that standard incident of procedural fairness is that a party liable to be affected by an exercise of power has an entitlement "to put information and submissions to the decision-maker in support of an outcome that supports his or her interests", being an entitlement which "extends to the right to rebut or qualify by further information, and comment by 175 (2003) 214 CLR 1 at 14 [37]-[38]. 176 In re K (Infants) [1963] Ch 381 at 405-406, quoted in Tariq v Home Office [2012] 1 AC 452 at 513 [103] and cited in Al Rawi v Security Service [2012] 1 AC 531 at 177 Eg Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 100 [157], 109 [192]. way of submission, upon adverse material from other sources which is put before the decision-maker"178. The historical norm and institutional ideal are reflected in what was described in HT v The Queen179 as a "general rule" within "an adversarial system": "that opposing parties will know what case an opposite party seeks to make and how that party seeks to make it". The want of procedural fairness found in HT v The Queen, where a court of criminal appeal had re-sentenced an offender having regard to evidence which was withheld from the offender, was explained in terms of an unjustified departure from the general rule in the circumstances of the case180. Condon v Pompano Pty Ltd181 can be treated as authority for the proposition that a legislated departure from the general rule does not necessarily result in non- compliance with the standard of procedural fairness required by Ch III of the Constitution of a court engaged in a judicial process. How then is the difference between compliance and non-compliance with that standard determined? There is much to be said for an approach which would require any legislated departure from the general rule to be no more than is reasonably necessary to protect a compelling public interest. That approach might be thought to cohere with the approach favoured in Hogan v Hinch182 to determining the consistency with Ch III of the Constitution of a legislated departure from "the general rule that judicial proceedings shall be conducted in public"183. French CJ often emphasised that open justice and natural justice are closely related aspects of a judicial process184. Be that as it may, the appellant does not argue for such an approach. In the absence of argument, I do not propose to explore the approach further. The argument of the appellant approaches the question from a different direction. The argument posits that the procedural fairness required of a court engaged in a judicial process has a minimum content. For the identification of that 178 Commissioner for Australian Capital Territory Revenue v Alphaone Pty Ltd (1994) 49 FCR 576 at 591-592, quoted in SZBEL v Minister for Immigration and Multicultural and Indigenous Affairs (2006) 228 CLR 152 at 161-162 [29]. 179 (2019) 269 CLR 403 at 416 [17]. 180 (2019) 269 CLR 403 at 424 [46], 426 [52]. See also at 427-428 [57]-[58], 430 [64]. 181 (2013) 252 CLR 38 at 87-88 [116]-[120]. 182 (2011) 243 CLR 506 at 552-554 [85]-[91]. 183 Russell v Russell (1976) 134 CLR 495 at 520. 184 See, eg, South Australia v Totani (2010) 242 CLR 1 at 43 [62]. minimum content in terms adequate to resolve the precise question in the appeal, the appellant relies on something I said in Pompano. There I said185: "A court cannot be required by statute to adopt a procedure that is unfair. A procedure is unfair if it has the capacity to result in the court making an order that finally alters or determines a right or legally protected interest of a person without affording that person a fair opportunity to respond to evidence on which that order might be made." That statement of principle was formulated in the context of considering a procedure in accordance with which evidence undisclosed to a party might be used as a sword in seeking an order against that party. But the principle, if sound, must apply equally to a procedure in accordance with which evidence undisclosed to a party might be used as a shield in resisting an order sought by that party. I see no reason to resile from the principle as formulated. Of course, a great deal turns on what is taken to be meant by a "fair opportunity". In formulating the principle, I used the expression in the orthodox sense of meaning an opportunity that is fair in the "circumstances of the particular case"186. Whether a process is fair in the circumstances of a particular case, as the Full Court of the Federal Court subsequently noted in Shrestha v Migration Review Tribunal187 with reference to Lam, cannot be determined by reference to a single consideration but depends on "the particular circumstances in which that process occurs, including (but not limited to) the statutory setting, the characteristics of the parties involved, what is at stake for them, the nature of the decision to be made, and steps already taken in the process". A fair opportunity to respond to evidence in the circumstances of a particular case is an opportunity that is fair having regard, amongst other considerations, to the significance of the evidence to the resolution of the controversy before the court and to any competing public interest that might exist in maintaining the secrecy of the evidence. I did not mean in Pompano to convey that a fair opportunity to respond to evidence could only ever be provided by full disclosure of that evidence to a party. I did mean to convey that an unyielding requirement for evidence that is acted upon by a court to be kept secret has the capacity to result in the denial to a particular party of an opportunity to respond to particular evidence which is fair in the circumstances of a particular case. 185 (2013) 252 CLR 38 at 105 [177]. 186 Kioa v West (1985) 159 CLR 550 at 585. See also at 563, 611, 633. 187 (2015) 229 FCR 301 at 310 [49]. See also Roberts v Harkness (2018) 57 VR 334 at Understood in that sense, my statement of principle does not appear to have been contradicted by anything in other reasons for judgment in Pompano. The judicial process in issue in Pompano was one pursuant to which the Supreme Court of Queensland was empowered to make a control order against a respondent. The Supreme Court could make the control order on the basis of information not disclosed to the respondent if it had declared that information to be "criminal intelligence". The power of the Supreme Court to declare information to be criminal intelligence was to be exercised in advance of the application for the control order and was discretionary. In exercising that discretion, the Supreme Court was expressly permitted to consider whether such prejudice as disclosure might cause to a designated public interest "outweigh[ed] any unfairness to a respondent"188. All members of this Court in Pompano reasoned to the conclusion that the judicial process in issue was consistent with Ch III of the Constitution. Hayne, Crennan, Kiefel and Bell JJ reached that conclusion taking the view that fairness to a known respondent was a matter to which the Supreme Court was bound to have regard when deciding whether to declare information to be criminal intelligence189. I took the view that the requirement for the Supreme Court to weigh unfairness to a respondent when deciding whether to declare information to be criminal intelligence went a long way towards ensuring that non-disclosure to the respondent would not be unfair, but not quite far enough190. My concern was that an assessment made by the Supreme Court, in advance of an application for a control order, that a protected public interest outweighed unfairness to a respondent might turn out to be wrong on the hearing of an application191. That concern was assuaged by the inherent jurisdiction of the Supreme Court to stay an application in the event of insurmountable unfairness emerging192. French CJ likewise considered that the Supreme Court "would have a discretion to refuse to act upon criminal intelligence where to do so would give rise to a degree of unfairness in the circumstances of the particular case which could not have been contemplated at the time that the criminal intelligence declaration was made"193. 188 See s 72(2) of the Criminal Organisation Act 2009 (Qld). 189 (2013) 252 CLR 38 at 101 [162]. 190 (2013) 252 CLR 38 at 112-113 [201]-[204]. 191 (2013) 252 CLR 38 at 113 [205]. 192 (2013) 252 CLR 38 at 115 [212]. 193 (2013) 252 CLR 38 at 80 [88]. Thus, all members of the Court in Pompano treated the capacity of a court to be satisfied that non-disclosure of particular information to a particular party would not be unfair as important to the consistency with Ch III of the Constitution of the judicial process in issue. Pompano does not deny the proposition that an inflexible legislative requirement for a court to withhold from a party information on which the court can base an order adverse to that party may be inconsistent with Ch III of the Constitution. Neither Gypsy Jokers Motorcycle Club Inc v Commissioner of Police194 nor Graham v Minister for Immigration and Border Protection195 is authority to the contrary. Gypsy Jokers was considered in Pompano. As I pointed out in Pompano196, the statement of Crennan J (with whom Gleeson CJ agreed) in Gypsy Jokers that "Parliament can validly legislate to exclude or modify the rules of procedural fairness"197 must be read in light of her Honour's conclusion that the provision there in issue198 effected no more than a "modification"199. Moreover, her Honour's conclusion was expressed in terms that "[t]he statutory modification of procedural fairness achieved ... [was] indistinguishable from the modification of procedural fairness which can arise from the application of the principles of public interest immunity"200. To similar effect, Gummow, Hayne, Heydon and Kiefel JJ observed that the provision produced "an outcome comparable with that of the common law respecting public interest immunity, but with the difference that the Court itself may make use of the information in question"201. Necessarily implicit in that explanation of the operation of the provision was an understanding that the provision not only left it to the court "to determine upon evidence provided to it whether the disclosure of the information might have the prejudicial effect spoken 194 (2008) 234 CLR 532. 195 (2017) 263 CLR 1. 196 (2013) 252 CLR 38 at 108 [190]. 197 (2008) 234 CLR 532 at 595 [182]. 198 Section 76(2) of the Corruption and Crime Commission Act 2003 (WA). 199 (2008) 234 CLR 532 at 595-597 [181]-[189]. 200 (2008) 234 CLR 532 at 596 [183]. 201 (2008) 234 CLR 532 at 559 [36]. of"202 but also permitted the court to balance the prejudicial effect of non- disclosure on the ability of a party to present that party's case203. Graham had nothing to say about procedural fairness as an aspect of judicial process. Indeed, no argument about procedural fairness was put or considered in Graham. That is hardly surprising given that the provision there centrally in issue prevented disclosure not only to a party but also to a court204. The principle on which Graham turned was that a Commonwealth law cannot impair the ability of the court, through the application of a judicial process, to discern and declare whether or not the conditions of and constraints on the lawful exercise of a power legislatively conferred on an officer of the Commonwealth have been observed in a particular case205. For the reasons I set out in Pompano, it should be recognised that a court determining a justiciable controversy between parties cannot be required by statute to adopt a procedure that has the capacity to result in the court making a final order without affording a party adversely affected by the order an opportunity – fair in the circumstances of the particular case – to respond to evidence on which the order might be made. To recognise that constitutional minimum is not to deny the capacity of a legislature to enact standardised rules of procedure by which sensitive information might be received into evidence without being disclosed to a party. The broader and more inflexibly a standardised rule proscribing disclosure is framed, however, the greater must be the danger of breach of the constitutional minimum. At least that is so absent some form of safety valve by means of which the court can ensure either that the adverse order is not made or that disclosure will occur if the court forms the view that non-disclosure is unfair in the circumstances of the particular case. Observance of the constitutional minimum where a court is authorised by statute to engage in a process of adjudication taking account of information which relates to national security does no violence to the allocation of functional responsibilities inherent in the constitutional separation of the judicial power of the Commonwealth. Subject to regulation by the Commonwealth Parliament206, functional responsibility for national security undoubtedly lies, as it has always lain, with the Executive Government of the Commonwealth. Yet the onetime 202 (2008) 234 CLR 532 at 558 [33]. 203 See Alister v The Queen (1983) 154 CLR 404 at 412. 204 Section 503A(2)(c) of the Migration Act 1958 (Cth). 205 (2017) 263 CLR 1 at 27-29 [48]-[53]. 206 Brown v West (1990) 169 CLR 195 at 202; Plaintiff M68/2015 v Minister for Immigration and Border Protection (2016) 257 CLR 42 at 93 [122]. notion that "those who are responsible for national security must be the sole judges of what the national security requires"207 has long been regarded as "too absolute"208. Courts can and do weigh considerations of national security when doing so is necessary for the performance of the judicial function. They do so aware of their institutional limitations and of the consequent need for them to adopt a cautious approach209. If a court can be trusted to receive national security information into evidence in determining the rights of the parties to a particular case, it is not too glib to say that the court should be trusted to weigh the interests of national security appropriately in considering what fairness to one or more of those parties requires in the circumstances of that case. The problem with s 46(2) of the AAT Act Because it has the capacity to result in the Federal Court having regard to information to which a party has not been afforded an opportunity to respond that is fair in the circumstances of the particular appeal, s 46(2) of the AAT Act in its application to information certified under s 39B(2)(a) renders the process by which the Federal Court is to hear and determine an appeal under s 44 procedurally unfair. The problem with s 46(2) in that operation lies in its rigidity in compelling a court never to disclose the certified information to a party or to a legal representative of a party irrespective of the degree of relevance or perceived relevance of the information to the resolution of an issue in the appeal and irrespective of the degree of prejudice to security or the defence or international relations of Australia that would result from disclosure to that party or legal representative. The problem of rigidity – of insensitivity to the possibility that some measure of disclosure might be needed to ensure procedural fairness in the circumstances of a particular appeal – is not alleviated by the miscellany of other considerations relied on by the respondents and interveners in argument. True it is that having automatic access to the whole of the relevant information that had been before the AAT and that is relevant to the appeal through the operation of s 46(1) avoids the unedifying prospect of the Federal Court being forced to determine the appeal on incomplete information. But having access to the whole of the material does not make the procedure by which the Federal Court determines the appeal by reference to that information fair. 207 The Commonwealth v Colonial Combing, Spinning and Weaving Co Ltd (1922) 31 CLR 421 at 442, quoting The Zamora [1916] 2 AC 77 at 107. 208 A v Hayden (1984) 156 CLR 532 at 548. See also at 591. 209 See Church of Scientology v Woodward (1982) 154 CLR 25 at 74-76; Alister v The Queen (1983) 154 CLR 404 at 435, 455. The Federal Court in determining the appeal can adjust the weight which it gives to certified information having regard to the circumstance that the information has been withheld from disclosure under s 46(2). But that is not part of the solution. Actually, it is part of the problem. Lord Kerr JSC eloquently explained in Al Rawi v Security Service210 that evidence insulated from challenge has the potential to mislead. The same is true of evidence insulated from contextual explanation. The capacity of a party unable to respond to certified information to seek judicial review of the certification decision of the ASIO Minister in this Court under s 75(v) of the Constitution or the Federal Court under s 39B(1) of the Judiciary Act does not solve the problem. The question for either court on an application for judicial review would be limited to whether the certification decision was invalid by reason of jurisdictional error. The court would not itself enter into the merits of whether disclosure would in fact be contrary to the public interest. The court would not have any occasion to consider the impact of non- disclosure on the fairness of the conduct of the appeal. No order the court could make could relieve against the intransigent preclusive effect on disclosure of a valid certification. The ability of the Federal Court sometimes to disclose the "gist" or substance of certified information without breach of the proscription in s 46(2) might ameliorate the problem in some cases. But it cannot solve the problem in every case. Whether something of use might be disclosed about certified information without disclosing the information itself (and thereby potentially jeopardising security, defence or international relations) is a fine question the answer to which must be highly context specific. The gist might sometimes be able to be given without disclosing the certified information. Not always. And giving the gist might often be enough to allow a fair opportunity to respond. Again, not always. Nor, it should be added, would the problem of rigidity be solved were the power of the Federal Court to control its own procedure to extend to the appointment of an officer to advocate for the interests of a party unable to respond to certified information. The absolute ban on disclosure to a party or to a legal representative of a party would remain. Whether the power of the Federal Court would extend to the appointment of such an officer is a topic on which I prefer to express no opinion. Comparison with a "closed material procedure" of a kind judicially fashioned by the Supreme Court of the United Kingdom in R (Haralambous) v 210 [2012] 1 AC 531 at 592 [93]. See also Zuckerman, Zuckerman on Civil Procedure, 4th ed (2021) at 1027 [19.107]. Crown Court at St Albans211 for the purpose of conducting judicial review of a decision based on national security information serves only to highlight the rigidity of s 46(2) of the AAT Act. It was said in Haralambous that "[a]s a matter of principle, open justice should prevail to the maximum extent possible" and that "[a]ny closed material procedure 'should only ever be contemplated or permitted by a court if satisfied, after inspection and full consideration of the relevant material ... that it is essential in the particular case' and should, of course, be restricted as far as possible"212. The rigidity of s 46(2) of the AAT Act is further pointed up when its operation is contrasted with the statutory "closed material procedure" for which provision is made in the Justice and Security Act 2013 (UK)213. The procedure applies in a particular civil proceeding only where the court itself first declares that the procedure will apply in that proceeding. To declare that the procedure will apply, the court itself must be satisfied not only that disclosure of the material would be damaging to the interests of national security but also that application of the procedure is in the interests of the fair and effective administration of justice in the proceeding214. A declaration once made must be kept under review by the court and can be revoked by the court at any time if the court considers that application of the procedure is no longer in the interests of the fair and effective administration of justice in the proceeding215. For so long as a declaration remains in force, sensitive material can be withheld from a party only with permission of the court216. The entire procedure by which sensitive material considered by a court can be withheld from a party is therefore subject to the control of the court and is tailored to the circumstances of the individual case. Finally, little assistance is to be gained by looking to the United States. A number of United States Courts of Appeals have rejected facial challenges brought on procedural due process grounds to a number of rigid congressional proscriptions of disclosure of certified national security information able to be 212 [2018] AC 236 at 272 [61], quoting Tariq v Home Office [2012] 1 AC 452 at 499- 213 See Zuckerman, Zuckerman on Civil Procedure, 4th ed (2021) at 1018-1023 214 Section 6 of the Justice and Security Act 2013 (UK). 215 Section 7 of the Justice and Security Act 2013 (UK). 216 Section 8 of the Justice and Security Act 2013 (UK); Pt 82 of the Civil Procedure Rules 1998 (UK); see also Zuckerman, Zuckerman on Civil Procedure, 4th ed considered by a court ex parte and in camera217. In so doing, they have applied a balancing test derived from the decision of the Supreme Court of the United States in Mathews v Eldridge218. That test does not draw a clear distinction between procedural due process in an administrative process and procedural due process in a judicial process. The manner of its application is therefore of marginal utility in considering the content of procedural fairness as an aspect of a judicial process under Ch III of the Constitution. Noteworthy nevertheless is that the Court of Appeals for the District of Columbia appears to have accepted that a proscription of disclosure of national security information has the potential to result in a denial of procedural due process in its application to the circumstances of a particular case in which a court, having considered the material ex parte and in camera, forms the view that it "cannot discharge its responsibility ... unless a petitioner's counsel has access to as much as is practical of the classified information"219. Section 46(2) of the AAT Act is inseverable Being incompatible with Ch III of the Constitution because it renders the process by which the Federal Court is to hear and determine an appeal under s 44 of the AAT Act procedurally unfair, s 46(2) is invalid in its application to information certified under s 39B(2)(a). Being invalid in its application to information certified under s 39B(2)(a), s 46(2) must also be invalid at least in its application to information certified under s 28(2)(a) or s 36(1)(a), which are in terms indistinguishable from s 39B(2)(a). Section 15A of the Acts Interpretation Act 1901 (Cth) requires 46(2) in those applications to be severed from the remainder of the AAT Act unless and to the extent that the requirement is displaced by a contrary intention appearing in the AAT Act. An intention to the contrary of s 15A exists if and insofar as the AAT Act manifests a positive intention that its provisions are to operate as a whole or not at all220. The respondents argue that the AAT Act manifests a positive intention that s 46 is to have no operation if s 46(2) cannot have full operation. I accept that argument. Section 46 operates as an integrated scheme. To sever s 46(2) in its application to information certified under s 39B(2)(a) would give s 46(1) a 217 Eg In re National Security Agency Telecommunications Records Litigation (2011) 671 F 3d 881 at 902-904; Fares v Smith (2018) 901 F 3d 315 at 323-326. 218 (1976) 424 US 319 at 335. 219 Fares v Smith (2018) 901 F 3d 315 at 322-323, quoting Bismullah v Gates (2007) 501 F 3d 178 at 187. 220 See Knight v Victoria (2017) 261 CLR 306 at 325 [35]. drastically different practical operation which would run counter to the purpose for which s 46(2) was evidently enacted. No party or intervener argues that s 46 is inseverable from the remainder of the AAT Act. Section 44 remains unaffected. The compulsory processes of the Federal Court, including by way of subpoena and notice to produce, also remain unaffected. Those processes are available to be used to ensure that documents relevant to an appeal under s 44 that were before the AAT in connection with the proceeding to which an appeal relates, subject to any successful claim to public interest immunity from production and subject to any confidentiality orders which the Federal Court might be persuaded to make, are available to both parties and can also be placed before the Federal Court on the hearing of the appeal. Orders I would allow the appeal and make the consequential orders proposed by 167 GORDON J. This is an appeal from a decision of the Full Court of the Federal Court of Australia, on appeal from a decision of the Security Division of the the Administrative Appeals Tribunal ("the Tribunal") under s 44(1) of Administrative Appeals Tribunal Act 1975 (Cth) ("the AAT Act"). In the Tribunal, the appellant had unsuccessfully sought merits review221 of an adverse security assessment given by the Australian Security Intelligence Organisation ("ASIO") under the Australian Security Intelligence Organisation Act 1979 (Cth) ("the ASIO Act"). In the Tribunal proceeding, the Minister administering the ASIO Act ("the ASIO Minister")222, as a member of the Executive, issued certificates under s 39B(2)(a) of the AAT Act on the ground that disclosure of the material the subject of the certificates ("the certified matter") would be contrary to the public interest because it would prejudice the security of Australia223. The appellant did not challenge the validity of the certificates. On the Federal Court proceeding being instituted by the appellant, s 46(1) of the AAT Act required the Tribunal to send to the Court all documents before the Tribunal which were relevant to the appeal, including the certified matter. Section 46(2), however, required the Federal Court to adopt a procedure that allowed the Director-General of Security and the Court to rely upon the certified matter but prevented any disclosure of that material to the appellant and his legal representatives, thereby denying the appellant any opportunity to respond to the certified matter. One of the appellant's grounds of appeal in the Federal Court alleged that the Tribunal's decision was not open on the evidence. The Director-General addressed that ground by reference to the certified matter and by reference to submissions to which the appellant could not respond. The Federal Court concluded, on the basis of the certified matter and submissions, that there was ample evidence for the conclusion that the adverse security assessment was justified. The appellant challenged the validity of s 46(2) of the AAT Act as infringing Ch III of the Constitution on the basis that it denied him procedural fairness. The Full Court of the Federal Court unanimously rejected that challenge. For the reasons that follow, s 46 of the AAT Act is contrary to Ch III of the Constitution and is wholly invalid. 221 Australian Security Intelligence Organisation Act 1979 (Cth), s 54. 222 AAT Act, s 3(1) definition of "ASIO Minister". 223 See [184] below. Chapter III and procedural fairness Two principles underpin the strict separation of Commonwealth judicial power: the judicial power of the Commonwealth may only be exercised by a body that is a "court" within the meaning of Ch III of the Constitution224 (a "Ch III court") and a federal court may only exercise the judicial power of the Commonwealth or a power incidental thereto225. Flowing from Ch III's exclusive vesting of the judicial power of the Commonwealth in Ch III courts and the implication that no Parliament can require a court to act in a manner repugnant to its institutional integrity226, "there is implicit a requirement that those 'courts' exhibit the essential attributes of a court and observe, in the exercise of that judicial power, the essential requirements of the curial process, including the obligation to act judicially"227. While the essential characteristics of a court and the meaning and content of "judicial power" may defy exhaustive and precise definition228, observance of procedural fairness is both an essential characteristic of a court229 and an essential incident of the exercise of 224 R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 at 270. 225 Boilermakers (1956) 94 CLR 254 at 269-270. 226 Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51. See also Fardon v Attorney-General (Qld) (2004) 223 CLR 575 at 591 [15], 598-599 [37], 648 [198]; Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 88-89 [123]; Attorney-General (NT) v Emmerson (2014) 253 CLR 393 at 424 [40]; Kuczborski v Queensland (2014) 254 CLR 51 at 98 [139]; Vella v Commissioner of Police (NSW) (2019) 269 CLR 219 at 245-246 [55]. 227 Leeth v The Commonwealth (1992) 174 CLR 455 at 487. See also Waterside Workers' Federation of Australia v J W Alexander Ltd (1918) 25 CLR 434 at 442, 451; Polyukhovich v The Commonwealth (1991) 172 CLR 501 at 607, 689, 703-704; Chu Kheng Lim v Minister for Immigration, Local Government and Ethnic Affairs (1992) 176 CLR 1 at 27; Nicholas v The Queen (1998) 193 CLR 173 at 185 [13], 228 As to the essential or defining characteristics of courts see, eg, Forge v Australian Securities and Investments Commission (2006) 228 CLR 45 at 76 [64]; Emmerson (2014) 253 CLR 393 at 426 [44]. As to the meaning of "judicial power" see, eg, Minister for Home Affairs v Benbrika (2021) 95 ALJR 166 at 204 [146]; 388 ALR 1 at 43-44 and the authorities there cited. 229 See, eg, Hogan v Hinch (2011) 243 CLR 506 at 541 [45]; Wainohu v New South Wales (2011) 243 CLR 181 at 208 [44]; Plaintiff S10/2011 v Minister for Immigration and Citizenship (2012) 246 CLR 636 at 672 [117]; Pompano (2013) judicial power230. Put simply, "[p]rocedural fairness lies at the heart of the judicial function"231 – requirements of "procedural fairness"232. The "[a]brogation of natural justice" is, therefore, "anathema to Ch III of the Constitution"233. to observe judicially" to "act the The requirement to accord procedural fairness is to be understood as inhering or lying in the very nature of the common law system of adversarial trial administered in Australian courts234. Fairness "transcends the content of more particularized legal rules and principles and provides the ultimate rationale and touchstone of the rules and practices which the common law requires to be 252 CLR 38 at 71-72 [67]-[68], 99 [156], 105 [177], 106-108 [181]-[188], 110 [194]; North Australian Aboriginal Justice Agency Ltd v Northern Territory (2015) 256 CLR 569 at 594 [39(3)] ("NAAJA"). 230 See, eg, Leeth (1992) 174 CLR 455 at 469-470; Wilson v Minister for Aboriginal and Torres Strait Islander Affairs (1996) 189 CLR 1 at 22; Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82 at 101 [42]; International Finance Trust Co Ltd v New South Wales Crime Commission (2009) 240 CLR 319 at 354-355 [53]-[57], 366-367 [97]-[98], 379-381 [141]-[145]; TCL Air Conditioner (Zhongshan) Co Ltd v Judges of the Federal Court of Australia (2013) 251 CLR 231 HT v The Queen (2019) 269 CLR 403 at 430 [64] (footnote omitted). See also International Finance Trust (2009) 240 CLR 319 at 354 [54], 380-381 [143]-[144]. 232 Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321 at 366. See also Testro Bros Pty Ltd v Tait (1963) 109 CLR 353 at 363, 372; R v Trade Practices Tribunal; Ex parte Tasmanian Breweries Pty Ltd (1970) 123 CLR 361 at 373; Grollo v Palmer (1995) 184 CLR 348 at 359-360; Wilson (1996) 189 CLR 1 at 17, 233 Pompano (2013) 252 CLR 38 at 110 [194]. 234 cf International Finance Trust (2009) 240 CLR 319 at 374 [127]. See also Harris v Caladine (1991) 172 CLR 84 at 150; Re Nolan; Ex parte Young (1991) 172 CLR 460 at 496; Gipp v The Queen (1998) 194 CLR 106 at 122-123 [48]-[50]; Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337 at 343-344 [3]-[4]; Re Minister for Immigration and Multicultural Affairs; Ex parte Epeabaka (2001) 206 CLR 128 at 136 [22]-[23]; Forge (2006) 228 CLR 45 at 76 [64]; Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175 at 188-189 [23]-[24]; Lee v New South Wales Crime Commission (2013) 251 CLR 196 at 266 [176], 267 [181]; Pompano (2013) 252 CLR 38 at 46 [1]; Kuczborski (2014) 254 CLR 51 observed in the administration of the substantive criminal [and civil] law"235. The method of "administering justice" that lies at the heart of the common law tradition236 requires that courts adopt "a procedure that gives each interested person an opportunity to be heard and to deal with any case presented by those with opposing interests"237. "[T]he right of a party to meet the case made against him or her"238 – "to know key elements of the case against them"239 – is "intrinsic to the integrity of courts"240 operating in an adversarial system. It follows that "[n]o court in Australia can be required by statute to adopt an unfair procedure"241, recognising, of course, that a procedure is "not necessarily unfair because it is less than perfect"242. That is so even where the unfair procedure operates to disadvantage an applicant who brings proceedings (including judicial review or equivalent proceedings to enforce the limits on the lawful exercise of administrative power) at their own motion. And it is so irrespective of the fact that the legal rights at issue are statutory and irrespective of the applicant's unchallenged legal status in Australia. With that said, "[t]he rules of procedural fairness do not have immutably fixed content ... '[F]airness is not an abstract concept. It is essentially practical. Whether one talks in terms of procedural 235 Dietrich v The Queen (1992) 177 CLR 292 at 326, quoted in McHugh, "Does Chapter III of the Constitution Protect Substantive as well as Procedural Rights?" (2001) 21 Australian Bar Review 235 at 240. 236 Pompano (2013) 252 CLR 38 at 46 [1] (footnote omitted). See also NAAJA (2015) 256 CLR 569 at 621 [134]; Garlett v Western Australia [2022] HCA 30 at [115], 237 Wilson (1996) 189 CLR 1 at 17. 238 Nicholas (1998) 193 CLR 173 at 208 [74]. See also Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 359 [56]; Pompano (2013) 252 CLR 38 at 46 [1]. 239 Groves, "Exclusion of the Rules of Natural Justice" (2013) 39 Monash University Law Review 285 at 285. 240 Groves, "Exclusion of the Rules of Natural Justice" (2013) 39 Monash University Law Review 285 at 286. See also Forge (2006) 228 CLR 45 at 76 [63]; see also 67-68 [41], 121 [192]; Hogan (2011) 243 CLR 506 at 541 [45]; Wainohu (2011) 243 CLR 181 at 208 [44]. 241 Pompano (2013) 252 CLR 38 at 110 [194]; see also 105 [177]. See also Stellios, The Federal Judicature: Chapter III of the Constitution, 2nd ed (2020) at 545-546 242 Dietrich (1992) 177 CLR 292 at 365 (footnote omitted). fairness or natural justice, the concern of the law is to avoid practical injustice'"243. Procedural fairness necessarily has a variable content; it can be "provided by different means in different contexts and may well be provided by different means in a single context"244. It "is defined by practical judgments about its content and application"245. It is unnecessary in this case to traverse the metes and bounds of the sorts of procedures that might transgress the constitutional limitation – that is, by impermissibly abrogating natural justice or reducing the content of procedural fairness to "nothingness"246. The essential point is that a legislative procedure, viewed as a whole, cannot validly operate in a way that renders a court unable to respond to potential "practical injustice"247. Put differently, legislation cannot deprive a court of "the power to ensure, so far as practicable [and, it might be added, having regard to the particular context of the case], fairness between the parties"248. To conclude otherwise would render any limitation derived from Ch III which purported to protect the fairness of the judicial process meaningless. It would be "to construe Ch III ... as being concerned only with labels and as requiring no more than that the repository of judicial power be called a court", which "would be to convert it into a mockery, rather than a reflection, of the doctrine of separation of powers"249. As members of this Court have said on many 243 Pompano (2013) 252 CLR 38 at 99 [156] (quoting Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam (2003) 214 CLR 1 at 14 [37]); see also 105 [177], 108 [188]. See also HT (2019) 269 CLR 403 at 424 [46], 244 Pompano (2013) 252 CLR 38 at 105 [177], 111 [195]. See also Dietrich (1992) 177 CLR 292 at 364; International Finance Trust (2009) 240 CLR 319 at 354 [54]. 245 Pompano (2013) 252 CLR 38 at 72 [68]. 246 Pompano (2013) 252 CLR 38 at 110 [192]; see also 105 [177]. See also Kioa v West (1985) 159 CLR 550 at 615-616. 247 See Pompano (2013) 252 CLR 38 at 100 [157], 108 [188]. See also HT (2019) 269 CLR 403 at 424 [46]. 248 International Finance Trust (2009) 240 CLR 319 at 355 [55]. 249 Polyukhovich (1991) 172 CLR 501 at 607. occasions, the concern of Ch III is with substance, not form250: it "cannot be evaded by formal cloaks"251. As a "general rule" within an adversarial system "opposing parties will know what case an opposite party seeks to make and how that party seeks to make it"252. That "general rule" is not "absolute"253. It will not always be the case that parties (personally or by their representatives) "know of all of the material on which the Court is being asked to make its decision"254. In certain classes of case, a departure from the "general rule" may be justified. Where there is such a departure, how a court moulds its procedures to afford a fair opportunity for a party to respond to the case put by another party varies from case to case and from issue to issue; it depends, among other things, on the particular decision-making context, the competing interests to be balanced, and the rights and interests at stake. Examples of circumstances where the "general rule" may be modified include: public interest immunity claims255; confidential information cases, 250 Leeth (1992) 174 CLR 455 at 486-487; Lim (1992) 176 CLR 1 at 27; Nicholas (1998) 193 CLR 173 at 233 [148]; Re Woolley; Ex parte Applicants M276/2003 (2004) 225 CLR 1 at 35 [82]; Graham v Minister for Immigration and Border Protection (2017) 263 CLR 1 at 27 [48]; Benbrika (2021) 95 ALJR 166 at 190-191 [78], 209 [168], 217 [203]; 388 ALR 1 at 26-27, 50, 60; Alexander v Minister for Home Affairs (2022) 96 ALJR 560 at 578 [72], 580 [79], 595 [158], 632 [337]; 401 ALR 438 at 454, 456, 476, 525. 251 Re Woolley (2004) 225 CLR 1 at 35 [82]. 252 Pompano (2013) 252 CLR 38 at 100 [157] (emphasis in original). See also Bass (1999) 198 CLR 334 at 359 [56]; International Finance Trust (2009) 240 CLR 319 at 348 [39], 354 [54], 374-375 [127], 379-380 [141]-[143]; Magaming v The Queen (2013) 252 CLR 381 at 401 [65]; HT (2019) 269 CLR 403 at 416 [17], 429-430 253 Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532 at 597 [189]; Pompano (2013) 252 CLR 38 at 72 [68], 100 [157]. 254 cf Pompano (2013) 252 CLR 38 at 88 [118] (emphasis in original); see generally 255 See Pompano (2013) 252 CLR 38 at 109 [192]; HT (2019) 269 CLR 403 at 420 [32], 421 [34], 432 [71]-[72]. See also Alister v The Queen (1983) 154 CLR 404 at 412; New South Wales v Public Transport Ticketing Corporation [No 3] (2011) 81 NSWLR 394 at 397 [10], 398 [20]; Al Rawi v Security Service [2012] 1 AC 531 at 592 [92]; Jaffarie v Director-General of Security (2014) 226 FCR 505 at 514-515 [27]; Re Timor Sea Oil & Gas Australia Pty Ltd (In liq) (2020) 389 ALR 545 at 550 including trade secrets cases256; legal professional privilege claims257; receipt of confidential affidavits in support of an application by a liquidator for an examination summons258; and cases where gender-restricted evidence is involved in native title claims259. Certain cases which are not "adversarial" in the ordinary sense, where the role of the court is "protective", have also justified departures from the "general rule", including: cases concerning children within a statutory the historical parens patriae welfare jurisdiction jurisdiction260; judicial advice proceedings for the purpose of protecting the interests of a trustee and trust261; cases invoking the court's power (which is "protective in nature") to approve a settlement claim by a person under a legal incapacity262; and applications for approval of representative proceedings, in respect of which the court assumes a "protective role in relation to the interests of that originated from 256 See Gypsy Jokers (2008) 234 CLR 532 at 596 [184]-[185] and the cases there cited; Pompano (2013) 252 CLR 38 at 100 [157], 101 [161]; HT (2019) 269 CLR 403 at 423-424 [44]-[46], 427-428 [58], 431 [67], 433-434 [75]-[77]. See also Al Rawi [2012] 1 AC 531 at 585 [64]; Renshaw v New South Wales Lotteries [2020] NSWSC 257 See Pompano (2013) 252 CLR 38 at 109 [192]; Hancock v Rinehart [2016] NSWSC 12 at [7], [27]-[29], [31], [34]; Rinehart v Rinehart [2016] NSWCA 58 at [29]-[31]. 258 See Simionato v Macks (1996) 19 ACSR 34 at 62-63; Re Normans Wines Ltd (Receivers and Managers Appointed) (In liq) (2004) 88 SASR 541 at 554-555 259 See Western Australia v Ward (1997) 76 FCR 492 at 495; see also 499, 508. 260 See In re K (Infants) [1965] AC 201 at 240-241; Fountain v Alexander (1982) 150 CLR 615 at 633; M v M (1988) 166 CLR 69 at 76; Secretary, Department of Health and Community Services v JWB (Marion's Case) (1992) 175 CLR 218 at 258-259; Palmer v Ayres (2017) 259 CLR 478 at 516 [102]. 261 Minister for Immigration and Multicultural and Indigenous Affairs v B (2004) 219 CLR 365 at 378 [8]; Macedonian Orthodox Community Church St Petka Inc v His Eminence Petar Diocesan Bishop of Macedonian Orthodox Diocese of Australia and New Zealand (2008) 237 CLR 66 at 91 [64], 94 [72]. 262 See Fisher v Marin [2008] NSWSC 1357 at [29]. class members"263 "akin to that of a guardian"264 and not unlike the role of the court in approving compromises on behalf of infants or persons under a legal incapacity265. Equally, Parliament may fashion "novel procedures" that balance competing interests in certain classes or categories of case, which depart from or qualify the "general rule"266, provided that the procedures adopted include adequate safeguards to enable the court to respond to potential "practical injustice"267 and to ensure, "so far as practicable [having regard to the particular context of the case], fairness between the parties"268. In other words, Parliament must ensure that the processes of the court, viewed as a whole, are not unfair. Chapter III courts must retain their ability to protect the fairness of the judicial process whilst recognising that it is implicit within "the notion of 'fairness'" that "sometimes, the rules governing practice, procedure and evidence must be tempered by reason and commonsense to accommodate the special case that has arisen because, otherwise, prejudice or unfairness might result"269. As will be seen, the immediate difficulty is that s 46(2) of the AAT Act impermissibly excludes procedural fairness for a whole class of case by removing the ability of the Federal Court to respond to potential "practical injustice"270; it removes the ability of the Court to ensure, "so far as practicable [having regard to the particular context of the case], fairness between the parties"271. Section 46(2) 263 See Kelly v Willmott Forests Ltd (In liq) [No 4] (2016) 335 ALR 439 at 443 [3]; see also 454 [62]. See also Carnie v Esanda Finance Corporation Ltd (1995) 182 CLR 398 at 408. 264 Australian Securities and Investments Commission v Richards [2013] FCAFC 89 at 265 Tasfast Air Freight Pty Ltd v Mobil Oil Australia Ltd [2002] VSC 457 at [4], cited with approval in Richards [2013] FCAFC 89 at [8]. 266 Pompano (2013) 252 CLR 38 at 100 [157]; see also 47 [5], 103 [169], 110 [193]. 267 See Pompano (2013) 252 CLR 38 at 100 [157], 108 [188]. See also HT (2019) 269 CLR 403 at 424 [46]. 268 International Finance Trust (2009) 240 CLR 319 at 355 [55]. 269 Dietrich (1992) 177 CLR 292 at 363. 270 See Pompano (2013) 252 CLR 38 at 100 [157], 108 [188]. See also HT (2019) 269 CLR 403 at 424 [46]. 271 International Finance Trust (2009) 240 CLR 319 at 355 [55]. purports to "obliterate one of [the] most important attributes"272 of Ch III courts – the observance of procedural fairness. It cannot do so consistently with Ch III of the Constitution. Construction of s 46 of the AAT Act In considering validity, the starting point is the proper construction of s 46(2) of the AAT Act273. It is necessary to consider the operation of s 46(2) within the framework of the statutory scheme within which it sits – a regime governing the merits review function conferred upon the Tribunal in relation to security assessments given by ASIO under the ASIO Act274. One of the functions of ASIO under the ASIO Act is to provide advice to Ministers and Commonwealth authorities in respect of matters relating to security insofar as those matters are relevant to their functions and responsibilities275, including furnishing "security assessments"276 to Commonwealth agencies. An "adverse security assessment" or a "qualified security assessment" must be accompanied by a "statement of the grounds for the assessment", which forms part of the assessment277. The statement of grounds must "contain all information that has been relied on by [ASIO] in making the assessment, other than information the 272 cf Russell v Russell (1976) 134 CLR 495 at 520. 273 See Fairfax v Federal Commissioner of Taxation (1965) 114 CLR 1 at 7; Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476 at 498-499 [53]; Coleman v Power (2004) 220 CLR 1 at 21 [3], 68 [158]; Gypsy Jokers (2008) 234 CLR 532 at 553 [11]; NAAJA (2015) 256 CLR 569 at 581 [11]; Brown v Tasmania (2017) 261 CLR 328 at 428-429 274 ASIO Act, s 54. 275 ASIO Act, s 17(1)(c). 276 ASIO Act, s 37(1). "[S]ecurity" is defined to include, among other things, "the protection of, and of the people of, the Commonwealth and the several States and Territories from: (i) espionage; (ii) sabotage; (iii) politically motivated violence; (iv) promotion of communal violence; (v) attacks on Australia's defence system; or (vi) acts of foreign interference; whether directed from, or committed within, Australia or not": ASIO Act, s 4 definition of "security". 277 ASIO Act, s 37(2); see also s 35(1) definitions of "adverse security assessment" and "qualified security assessment". inclusion of which would, in the opinion of the Director-General, be contrary to the requirements of security"278. Where a security assessment in respect of a person is furnished by ASIO to a Commonwealth agency, the agency must "within 14 days ... give to that person a notice in writing, to which a copy of the assessment is attached, informing him or her of the making of the assessment"279. However, if the Minister issues a certificate certifying that they are satisfied that the withholding of notice "is essential to the security of the nation"280 then s 38(1) does not require a notice to be given281; and if the Minister issues a certificate certifying that disclosure of the statement of grounds or a particular part of that statement "would be prejudicial to the interests of security"282, then the copy of the assessment attached to a notice under s 38(1) "shall not contain any matter to which the certificate applies"283. There are two mechanisms available to a person to challenge a security assessment made in respect of them. The first is by seeking judicial review in the High Court under s 75(v) of the Constitution or in the Federal Court under s 39B of the Judiciary Act 1903 (Cth). As the Solicitor-General of the Commonwealth properly accepted, in light of Plaintiff S157/2002 v The Commonwealth284, s 37(5) of the ASIO Act – which relevantly provides that no proceedings, other than an application to the Tribunal under s 54, shall be brought in any court or tribunal in respect of the making of an assessment – would not prevent review for jurisdictional error. The second is by seeking merits review under s 54 of the ASIO Act in the Tribunal285. Where an applicant seeks merits review under s 54 of the ASIO Act, the Director-General must "present to the Tribunal all relevant information available to the Director-General, whether favourable or unfavourable to the 278 ASIO Act, s 37(2)(a). 279 ASIO Act, s 38(1). 280 ASIO Act, s 38(2)(a). 281 ASIO Act, s 38(4). 282 ASIO Act, s 38(2)(b). 283 ASIO Act, s 38(5) (emphasis added). 284 (2003) 211 CLR 476. 285 See AAT Act, s 17B(2)(a). applicant"286. However, the ASIO Minister may issue a written certificate certifying that the disclosure of information with respect to a matter stated in the certificate, or the disclosure of the contents of a document, would be contrary to the public interest: (a) because it would prejudice security or the defence or international relations of Australia; (b) because it would involve the disclosure of deliberations or decisions of the Cabinet or a Committee of the Cabinet or of the Executive Council; or (c) for any other reason stated in the certificate that could form the basis for a claim by the Crown in right of the Commonwealth in a judicial proceeding that the information or the contents of the document should not be disclosed (a "s 39B(2) certificate")287. If a s 39B(2) certificate is given then, subject to s 39B(4), (5) and (7) and s 46, the Tribunal must "do all things necessary to ensure", relevantly, "that the information or the contents of the document are not disclosed to anyone other than a member of the Tribunal as constituted for the purposes of the proceeding"288. A party to a proceeding before the Tribunal may appeal to the Federal Court, on a question of law, from any decision of the Tribunal in that proceeding289. The regime for placing the record of the Tribunal proceeding before the Federal Court is akin to the historical use of the writ of certiorari, issued by a superior court to direct that the record of the lower court or tribunal be sent to the superior court for review290. When a party to a proceeding before the Tribunal appeals to the Federal Court on a question of law under s 44(1) of the AAT Act, s 46(1)(a) of the AAT Act states that the Tribunal must, relevantly, "cause to be sent to the Court all documents that were before the Tribunal in connexion with the proceeding to which the appeal ... relates and are relevant to the appeal". Rules 33.23 and 33.26 of the Federal Court Rules 2011 (Cth) provide that an appeal book in a prescribed form is to be prepared whereby the formal decision of the Tribunal and the reasons for the decision as well as the record of the Tribunal proceeding are effectively lifted up and placed before the Federal Court; indeed, all of the material in the Comprehensive Reference Index – being a complete index of the record of the 286 AAT Act, s 39A(3). 287 AAT Act, s 39B(2); see also s 39A(8)-(10) regarding certificates issued by the ASIO Minister in respect of evidence proposed to be adduced or submissions proposed to be made by or on behalf of the Director-General. 288 AAT Act, s 39B(3)(a) (emphasis added). 289 AAT Act, s 44(1). 290 See Henderson, Foundations of English Administrative Law: Certiorari and Mandamus in the Seventeenth Century (1963) at 84, 89-91; Griffiths v The Queen (1977) 137 CLR 293 at 313; Re McBain; Ex parte Australian Catholic Bishops Conference (2002) 209 CLR 372 at 470 [276]. evidence in the Tribunal – is taken to "form part of the appeal book for the appeal". When the Federal Court proceeding has ended, the Court must "cause the documents" provided to the Court under s 46(1)(a) "to be returned to the Tribunal"291. Section 46(2) relevantly provides that "[i]f there is in force in respect of any of the documents a certificate in accordance with [s 39B(2) of the AAT Act] certifying that the disclosure of matter contained in the document would be contrary to the public interest, the Federal Court ... shall, subject to subsection (3), do all things necessary to ensure that the matter is not disclosed to any person other than a member of the court as constituted for the purposes of the proceeding" (emphasis added). Read in context, "the documents" is a reference to the documents provided to the Federal Court under s 46(1). What the term "matter" captures will depend on the terms of the certificate – for example, whether the certificate attaches a range of documents or simply identifies a particular piece of factual information, topic or issue as the subject of the certificate. Although the entirety of the relevant record of the Tribunal proceeding must be made available to the Federal Court and may be relied upon by both the Director-General and the Court, the Court is obliged, by reason of s 46(2), not to permit the applicant to inspect any part of the record that is the subject of a s 39B(2) certificate or to order the disclosure of any certified matter, including, for example, an unredacted copy of the Tribunal's reasons insofar as the reasons contain certified matter. Section 46(3) relevantly provides that if the s 39B(2) certificate "does not specify a reason referred to in [s] 39B(2)(a)", and a question arises as to whether "the matter should be disclosed to some or all of the parties to the proceeding before the Tribunal in respect of which the appeal was instituted", and the Court decides that the matter should be disclosed, then the Court must permit the part of the document in which the matter is contained to be inspected. In other words, the regime varies depending on the basis on which a s 39B(2) certificate is issued. If a certificate is issued under s 39B(2)(a) (on the basis that disclosure would prejudice security or the defence or international relations of Australia) then the Court can never authorise the material to be inspected. Section 46 wholly invalid By forbidding the Court in any and every case from making any certified matter available to the applicant or any representative of the applicant, s 46(2) binds the Federal Court to a procedure that has the potential to result in 291 AAT Act, s 46(1)(b). unfairness292. Viewed as a whole, s 46 renders the Federal Court unable to respond to potential "practical injustice"293. Put differently, s 46(2) deprives the Federal Court of "the power to ensure, so far as practicable [having regard to the particular context of the case], fairness between the parties"294. Insofar as s 46(2) operates in respect of a certificate issued under s 39B(2)(a), it imposes a blanket and inflexible non-disclosure requirement, operating as a strait-jacket on the Court's ability to minimise or alleviate practical injustice and requiring the Court to act "unjudicially"295. Section 46(2) assumes and requires that if a certificate has been issued under s 39B(2)(a) of the AAT Act, the certified matter can never be disclosed to any person296 (including the applicant and their legal representatives) in any circumstance, notwithstanding that it must be "relevant to the appeal"297 and despite the fact that it is provided to the Court and may be relied upon by both the Director-General and the Court. That is, it starts from an assumption "that procedural fairness should altogether be denied in order that sensitive information be kept confidential"298 and it permits of no exceptions. Section 46(2) deprives the Court of the power to determine whether procedural fairness, judged by reference to practical considerations arising in a particular case, requires disclosure of any aspect of the certified matter to the applicant or their legal representatives before an order is made, and it deprives the 292 Pompano (2013) 252 CLR 38 at 110 [194]; see also 105 [177]. See also Stellios, The Federal Judicature: Chapter III of the Constitution, 2nd ed (2020) at 545-546 293 See Pompano (2013) 252 CLR 38 at 100 [157], 108 [188]. See also HT (2019) 269 CLR 403 at 424 [46]. 294 International Finance Trust (2009) 240 CLR 319 at 355 [55]. 295 cf Benbrika (2021) 95 ALJR 166 at 222-223 [223]; 388 ALR 1 at 68. See also Testro Bros (1963) 109 CLR 353 at 363, 372; Tasmanian Breweries (1970) 123 CLR 361 at 373; Bond (1990) 170 CLR 321 at 366; Leeth (1992) 174 CLR 455 at 487; Grollo (1995) 184 CLR 348 at 359-360; Wilson (1996) 189 CLR 1 at 17, 23. 296 Other than a member of the Court as constituted for the purposes of the proceeding or an officer of the Court in the course of the performance of their duties as an officer of the Court: see AAT Act, s 46(2) and (4). 297 AAT Act, s 46(1). 298 cf HT (2019) 269 CLR 403 at 423 [43]. Court of the power to determine the procedure by which the disclosure might be made299. Section 46(2) does not modify, or depart from, the "general rule" – that a party has a right to know and meet the case made against them – in a manner that ensures the judicial process, as a whole, is not unfair 300. It is to the opposite effect: it requires the Court to "do all things necessary to ensure" that the certified matter is not disclosed to any person other than a member of the Court as constituted for the purposes of the proceeding. The express terms and stated purpose of s 46(2) do not permit the Court to refuse to consider relevant certified matter unless that certified matter was disclosed legal representatives. Unless s 46(2) is invalid, the Court simply cannot disobey the statutory command. That conclusion is reinforced by the fact that, as the Solicitor-General of the Commonwealth acknowledged, if the Court was to refuse to consider the certified matter unless it was disclosed to an applicant or an applicant's legal representatives, there would be an "endless loop" – the appeal under s 44 of the AAT Act would be conducted as if the decision-maker was not entitled to rely on the certified matter, and the Court would allow the appeal and remit it to the Tribunal, only for the Tribunal to again rely on the certified matter and make the same decision. Put simply, it would make no sense to conduct an appeal on a question of law on a different evidentiary record to the evidentiary record upon which the primary decision-maker relied301. to an applicant or an applicant's In some contexts, depending on the terms of the certificate issued by the Executive, the Court may be able to disclose the gist of the certified matter at a sufficiently high level of generality, such that it would avoid disclosing the "matter contained in the document" within the meaning of s 46(2). Whether that is so will depend not on the degree of sensitivity of the information, but on the level at which the Executive described the certified matter. In at least some cases, the Court must be prevented from disclosing even the gist of the certified matter even where the disclosure would pose a trivial risk to security or the defence or international relations of Australia relative to the prejudice that non-disclosure would cause to an individual. The Court would be precluded from addressing that practical injustice. The point of present importance is that the Court is deprived of any capacity to consider and mould its procedures to avoid practical injustice to the parties in a 299 cf International Finance Trust (2009) 240 CLR 319 at 355 [56]. 300 See [176]-[179] above. 301 cf R (Haralambous) v Crown Court at St Albans [2018] AC 236 at 265 [42], particular proceeding. That deprives the Court of an essential incident of the judicial function and thus an essential characteristic of a court. Obscuring the proper inquiry The Director-General and the Attorney-General of the Commonwealth (together, "the Commonwealth") submitted that any want of procedural fairness was irrelevant because, first, providing any form of appeal from a merits review was better than none and, second, an applicant could always seek judicial review of the validity of the certificate. Each argument obscured the proper inquiry. The jurisdiction of the Federal Court to hear and determine appeals under s 44(1) of the AAT Act from decisions of the Tribunal reviewing a security assessment "is necessarily conditioned by the requirement that it observe procedural fairness in the exercise of that jurisdiction"302. Having established a mechanism for seeking merits review of a security assessment (which Parliament did not have to do) and having established an avenue of appeal on a question of law to the Federal Court (which Parliament also did not have to do), the question is whether that regime impairs an essential characteristic of the Court or an essential incident of the exercise of judicial power. The availability and possible forensic advantages or disadvantages of a separate avenue of review (judicial review under s 75(v) of the Constitution or s 39B of the Judiciary Act) – as well as the nature or extent of an applicant's unchallenged legal status in Australia – have no bearing on that question; they are irrelevant to the validity of The fact that an applicant can test the validity of a certificate issued under s 39B(2) also says nothing about whether the procedure mandated by s 46(2) is practically unjust. While the ability of an applicant (or the Court on its own motion) to consider the validity of a certificate might be relevant in the context of an argument of the kind in issue in Gypsy Jokers Motorcycle Club Inc v Commissioner of Police303 and K-Generation Pty Ltd v Liquor Licensing Court304 to the effect that the independence of the Court was undermined by the Executive controlling or directing the Court, it may be put to one side for present purposes. Judicial review of the validity of a certificate is directed to the process adopted by the ASIO Minister in issuing the certificate – namely, whether the certificate was lawfully issued. Judicial review of the validity of a certificate is not directed to, and cannot address, whether s 46(2) requires the Federal Court "to adopt an unfair 302 Oakey Coal Action Alliance Inc v New Acland Coal Pty Ltd (2021) 95 ALJR 128 at 137 [47]; 386 ALR 212 at 222 (emphasis added). 303 (2008) 234 CLR 532. 304 (2009) 237 CLR 501. procedure"305 in a particular class of case because, viewed as a whole, s 46(2) renders to potential "practical injustice"306. the Federal Court unable respond Put differently, the ability to review the validity of a certificate – and, if the certificate is valid, the lawfulness of the denial of disclosure to the applicant of security-sensitive information (at the time of the making of the adverse security assessment) or the certified matter (at the review before the Tribunal) – does not change the fact that s 46(2) deprives the Federal Court of "the power to ensure, so far as practicable [having regard to the particular context of the case], fairness between the parties"307. The Federal Court is a Ch III court. The question is whether the state of affairs prescribed by s 46(2) is permitted under Ch III. It is not. Section 46(4) Some reference was made in argument to whether s 46(4) would permit the appointment of a special counsel "to assist the Court" hearing an appeal from the Tribunal. There is no basis to read into s 46(4) of the AAT Act a power to permit the appointment of a special counsel "to assist the Court" in determining whether the certified matter reveals error in a security assessment. Neither a legal practitioner representing a party nor a special counsel is "an officer of the court" within the meaning of s 46(4)308. That would not remedy the lack of flexibility afforded to the Court under s 46(2) to respond to potential practical injustice in the circumstances of a particular case. Section 46(2) not severable Section 46(2) and the other sub-sections in s 46 form part of an inseverable scheme. It is evident from the text of s 46, considered as a whole, that Parliament would not have enacted a regime whereby the Tribunal would provide to the Court "all documents that were before the Tribunal" that were relevant to the appeal309 in 305 Pompano (2013) 252 CLR 38 at 110 [194]; see also 105 [177]. See also Stellios, The Federal Judicature: Chapter III of the Constitution, 2nd ed (2020) at 545-546 306 See Pompano (2013) 252 CLR 38 at 100 [157], 108 [188]. See also HT (2019) 269 CLR 403 at 424 [46]. 307 International Finance Trust (2009) 240 CLR 319 at 355 [55] (emphasis added). 308 See National Archives of Australia v Fernandes (2014) 233 FCR 461 at 468 [44(a)]. 309 AAT Act, s 46(1). the absence of the statutory protection afforded by s 46(2) preventing disclosure of a certified matter. Section 46(3) is a clear indication that Parliament turned its mind to the circumstances in which the Court could balance competing interests in determining whether or not to disclose a certified matter, and that, having done so, Parliament made a conscious choice not to permit such balancing in respect of certificates issued on the basis that disclosure would be contrary to the public interest "because it would prejudice security or the defence or international relations of Australia"310. That is, Parliament intended that s 46 would apply in its entirety or not at all to certified matter of that kind. Any form of the appellant's proposed reading down or severance would involve reversing the balance struck by Parliament regarding competing public interests and would result in a radical departure from the regime contemplated by Parliament311. "The Court cannot re-write a statute and so assume the functions of the legislature"312. Appellant's argument not foreclosed by existing authority The Commonwealth submitted that previous decisions of this Court compelled the view that s 46(2) was valid. That submission is rejected. The Commonwealth relied principally on three cases – Gypsy Jokers313, Condon v Pompano Pty Ltd314 and Graham v Minister for Immigration and Border Protection315. 310 AAT Act, s 39B(2)(a). 311 cf Gypsy Jokers (2008) 234 CLR 532 at 551 [5]. See also Pidoto v Victoria (1943) 68 CLR 87 at 111; Bank of New South Wales v The Commonwealth (1948) 76 CLR 1 at 372; Pompano (2013) 252 CLR 38 at 87 [114]; Spence v Queensland (2019) 268 CLR 355 at 414-416 [87]-[90]. 312 Bank of New South Wales (1948) 76 CLR 1 at 164. 313 (2008) 234 CLR 532. 314 (2013) 252 CLR 38. 315 (2017) 263 CLR 1. Gypsy Jokers In Gypsy Jokers316, the Court upheld the validity of s 76(2) of the Corruption and Crime Commission Act 2003 (WA), a State law challenged on Kable grounds317. Section 76 provided for a limited form of judicial review by the Supreme Court of fortification removal notices issued by the Commissioner of Police under s 72. Gypsy Jokers does not foreclose the appellant's argument in this case for four reasons. First, only two Justices in Gypsy Jokers squarely dealt with the procedural fairness argument put by the appellant. Only Crennan J, with whom Gleeson CJ agreed318, expressly rejected that argument319. Her Honour concluded that "Parliament can validly legislate to exclude or modify the rules of procedural fairness provided there is 'sufficient indication' that 'they are excluded by plain words of necessary intendment'"320. Crennan J left open the question of whether the Commonwealth Parliament could enact a provision analogous to s 76(2)321. Gummow, Hayne, Heydon and Kiefel JJ did not address the appellant's procedural fairness argument322. Instead, their Honours focused on whether there was a "legislative mandate for dictation to the Supreme Court by the Commissioner of the performance of its review function"323. Kirby J, in dissent, held that s 76(2) involved "an impermissible legislative direction to the Supreme Court"324, without separately addressing the appellant's procedural fairness argument. In this appeal, the Commonwealth asked the Court to read a single sentence of the plurality's judgment – where their Honours stated that "the operation of [the] legislative regime [had] an outcome comparable with that of the common law 316 (2008) 234 CLR 532. 317 See Kable (1996) 189 CLR 51 at 95-96, 103, 116, 143. 318 Gypsy Jokers (2008) 234 CLR 532 at 549-550 [1]. 319 Gypsy Jokers (2008) 234 CLR 532 at 596 [183], 597 [191]. 320 Gypsy Jokers (2008) 234 CLR 532 at 595-596 [182] (footnotes omitted, emphasis added); see also 551 [7]. 321 Gypsy Jokers (2008) 234 CLR 532 at 596 [186]. 322 cf Gypsy Jokers (2008) 234 CLR 532 at 552-553 [10], 592 [166]. See also Pompano (2013) 252 CLR 38 at 98 [152]-[153]. 323 Gypsy Jokers (2008) 234 CLR 532 at 559 [36]. 324 Gypsy Jokers (2008) 234 CLR 532 at 563 [52]. rejection of respecting public interest immunity, but with the difference that the Court itself [could] make use of the information in question"325 – as if it constituted a fairness argument. considered That contention is rejected. Read fairly and in context326, that observation of the plurality was part of their Honours' analysis of why the legislative regime did not involve a legislative mandate for dictation to the Court by the Commissioner of the performance of its review function. the appellant's procedural Second, in considering the second part of s 76(2), which stated that confidential information provided by the Commissioner was "for the court's use only and [was] not to be disclosed to any other person ... or publicly disclosed in any way"327, Gummow, Hayne, Heydon and Kiefel JJ held that "'use' entails all that is necessary or appropriate for the exercise by the Supreme Court of its jurisdiction to conduct the 'review' identified in s 76(1)"328. In other words, their Honours contemplated that the passive voice adopted in the provision necessarily accommodated a discretion – the Court could decline to use material where it would be procedurally unfair. Indeed, this explains why their Honours did not separately address the appellant's procedural fairness argument. It was unnecessary to do so. Third, while it is true that in Pompano, Hayne, Crennan, Kiefel and Bell JJ said that the decision in Gypsy Jokers "point[ed] firmly against" accepting the central proposition advanced in Pompano as to the invalidity of the impugned provisions in that case329, that observation must be understood in light of a proper understanding of what that central proposition was. As their Honours explained, the argument for invalidity "asserted that in deciding any dispute a State Supreme Court must always follow an adversarial procedure by which parties (personally or by their representatives) know of all of the material on which the Court is being asked to make its decision" because otherwise "there would be such a departure from procedural fairness that the institutional integrity of the Supreme Court would be impaired"330. Their Honours observed that that central proposition was 325 Gypsy Jokers (2008) 234 CLR 532 at 559 [36]. 326 See Gypsy Jokers (2008) 234 CLR 532 at 558-559 [31]-[36]. 327 See Gypsy Jokers (2008) 234 CLR 532 at 558 [30] (emphasis added). 328 Gypsy Jokers (2008) 234 CLR 532 at 559 [35] (footnote omitted, emphasis added). 329 Pompano (2013) 252 CLR 38 at 98 [153]. 330 Pompano (2013) 252 CLR 38 at 88 [118] (emphasis in original); see also 87-88 "absolute", permitting of no qualification or exception331. The procedural fairness argument raised by the appellant in this case is not absolute. That Gypsy Jokers was thought to "point[] firmly against" the procedural fairness argument in Pompano does not, therefore, provide an answer to this case332. Fourth, although the respondents in Pompano did not seek leave to reopen Gypsy Jokers, Hayne, Crennan, Kiefel and Bell JJ did not treat Gypsy Jokers as a complete answer to the absolute procedural fairness argument made by the respondents. After considering Gypsy Jokers, their Honours said that "lest it be said that the point was not dealt with expressly by a majority of the Court in Gypsy Jokers, it [was] as well to explore the issue further"333, following which their Honours went on to consider the absolute argument put by the respondents. Gageler J was similarly of the view that the procedural fairness argument put in Pompano was not foreclosed by Gypsy Jokers334. Pompano Nor is anything that was said in Pompano335 determinative of the validity of s 46(2) of the AAT Act. In Pompano, the Court upheld the validity of provisions in the Criminal Organisation Act 2009 (Qld) that prevented disclosure of declared "criminal intelligence" information to an affected party to certain proceedings. As the Solicitor-General of the Commonwealth properly acknowledged, the statutory regime in issue in Pompano contained a number of features that are distinguishable from the regime in issue in this case, such that it is not "a very close analogue" of s 46 of the AAT Act. First, in deciding whether to declare information to be "criminal intelligence", the Supreme Court was permitted to have regard to investigations, whether enabling discovery of the existence or identity of an informer, or danger to anyone's life or physical safety "outweigh[ed] any unfairness to a respondent"336. In other words, a balancing exercise was expressly contemplated. Indeed, the plurality held that "[i]n many cases, including those where the respondent to a considerations of prejudice criminal the 331 Pompano (2013) 252 CLR 38 at 88 [119]; see also 87-88 [116]-[118]. 332 cf Pompano (2013) 252 CLR 38 at 98 [153]. 333 Pompano (2013) 252 CLR 38 at 98 [153]. 334 Pompano (2013) 252 CLR 38 at 108-109 [189]-[190]. 335 (2013) 252 CLR 38. 336 Criminal Organisation Act, s 72(2). substantive application is known or can be ascertained, [fairness to a respondent] is a matter to which the Court would be bound to have regard"337. the affidavits accompanying Second, the plurality held that the respondents' constitutional challenge had to be determined on the basis of their Honours' construction of ss 8 and 10338. On that construction, the Commissioner of the Queensland Police Service was required to "give, in the application for a declaration that an organisation is a criminal organisation, and the application, detailed particulars of what [was] alleged against the respondent organisation and how the Commissioner put[] the case for making a declaration"339. The plurality said that, in combination, the provisions required "the Commissioner to tell the respondent the whole of the case which the Commissioner [sought] to make in support of the application for a declaration"340. Put in different terms, "the criminal intelligence provisions den[ied] a respondent knowledge of how the Commissioner [sought] to prove an allegation; they [did] not deny the respondent knowledge of what [was] the allegation that [was] made"341. Those features of the regime in Pompano are distinguishable from the regime in issue in this case. Further, and in any event, the Court in Pompano was not concerned with an argument of the kind in issue in this case. As explained above, the argument put by the respondents in Pompano was "absolute"342. Nor does Graham343 foreclose the appellant's argument in this case. In Graham, insofar as the plaintiff advanced an argument in favour of invalidity of s 503A(2) of the Migration Act 1958 (Cth) on the basis that it substantially impaired a court's "institutional integrity", the argument was focused on s 503A(2)(c) operating to preclude information from being provided to the 337 See Pompano (2013) 252 CLR 38 at 101 [162]; see also 112-113 [203]. 338 Pompano (2013) 252 CLR 38 at 84 [105]. 339 Pompano (2013) 252 CLR 38 at 84 [105] (emphasis added); see also 84 [104]. See also Criminal Organisation Act, ss 8(2)(c), 8(2)(d) and 8(3). 340 Pompano (2013) 252 CLR 38 at 84 [103] (footnote omitted). 341 Pompano (2013) 252 CLR 38 at 101 [163] (emphasis in original). See also Stellios, The Federal Judicature: Chapter III of the Constitution, 2nd ed (2020) at 550 342 See [208] above. 343 (2017) 263 CLR 1. court344. It was argued that, in that operation, it had the effect of "striking at the heart of the court's ability to ascertain the facts"345. The majority relevantly said that the plaintiff's argument proceeded on the basis that "it is an essential function of courts to find facts relevant to the determination of rights in issue" and that s 503A(2) prevented courts from doing so and, therefore, constituted an interference with their function346. The plaintiff's argument in Graham was not squarely put (or considered) on the basis that the legislative regime in issue in that case undermined the court's essential characteristic of affording procedural fairness. Nothing in this Court's reasoning in Graham should, therefore, be understood as having endorsed the validity of s 503A(2) insofar as it concerned non-disclosure to the plaintiff. Moreover, and in any event, s 503A(2)(c) relevantly operated so that the relevant Minister or officer could not be "required" to divulge or communicate information or material to a court or any person, but there was nothing to stop the court from divulging information to a person. Conclusion and orders For those reasons, s 46 of the AAT Act is wholly invalid. The appeal should be allowed and it should be declared that s 46 of the AAT Act is wholly invalid. Paragraphs 1 to 3 of the order of the Full Court of the Federal Court of Australia of 9 April 2021 should be set aside and the matter remitted to the Federal Court for determination according to law. 344 See Graham (2017) 263 CLR 1 at 21-22 [29]. 345 Graham (2017) 263 CLR 1 at 6; see also 22 [29]. 346 Graham (2017) 263 CLR 1 at 22 [29] (emphasis added). Edelman The extremes of procedural unfairness and institutional injustice Could it ever be procedurally fair for a court to decide that a person was lawfully stripped of their permanent right to remain in Australia for reasons which the person will never be given, based upon specific allegations about which the person will never be told, involving evidence which the person will never see and will never be able to address, and without hearing from any counsel to represent the person's interests? "[A] trial procedure can never be considered fair if a party to it is kept in ignorance of the case against [them]."347 The circumstance described above would not be a fair process if conducted by an administrative tribunal. But administrative tribunals are not required to meet the standards of judicial fairness and this appeal is not concerned with the fairness of a tribunal procedure. Nor would it be a fair process if conducted by a court. But it must be accepted that such a process will not substantially impair the institutional integrity of a court if it is justified as being no more than is reasonably necessary to protect a strong countervailing interest. The question raised by this appeal thus reduces to whether s 46(2) of the Administrative Appeals Tribunal Act 1975 (Cth) ("the AAT Act") is justified in requiring a court to deny an appellant procedural fairness in reliance upon the countervailing interests, no matter how weak, in three categories of confidential information set out in s 39B(2). That denial of procedural fairness is not justified. The absence of two obvious means of protecting the interests of an appellant, and the institutional integrity of the court, is fatal to validity: (i) a power for the court to consider the interests of an appellant when refusing disclosure under s 46(2); or (ii) a power to appoint a special advocate to represent the interests of an appellant, to the extent possible without full instructions. The appeal should be allowed and orders made as proposed by Gordon J. Agreement with other reasons and the structure of these reasons The background and legislative provisions are set out in detail in the reasons of Gordon J and those of Steward J. I agree with Gordon J's interpretation of s 46 and with her Honour's reasoning and conclusions that s 46(2) is inseverable from the other provisions in s 46 and cannot be read down. As the appellant conceded in oral argument, this also means that it cannot be disapplied. I also agree with her 347 Home Secretary v AF [No 3] [2010] 2 AC 269 at 355 [63]. Edelman Honour's reasons for concluding that the question on this appeal is not resolved by the decisions of this Court in Gypsy Jokers Motorcycle Club Inc v Commissioner of Police348, Condon v Pompano Pty Ltd349 or Graham v Minister for Immigration and Border Protection350. instruments of I emphatically agree with Gordon J that the appellant's unchallenged legal status in Australia is irrelevant to this appeal. The threshold at which a court's procedures become to compromise substantially the institutional integrity of the court, cannot vary according to the labels assigned to a person by Commonwealth legislation – citizen, permanent resident, or anything else. Those labels cannot be used to create different grades or qualities of justice in the Constitution351. Hence, legislation that impairs the institutional integrity of a court by a procedure of gross injustice cannot be saved merely because the injustice is meted out upon a long-term permanent resident of Australia who has not obtained the statutory status of an Australian citizen. threatening injustice, I agree with Steward J that s 46(2) gives rise to potential procedural unfairness to an appellant. Steward J interprets s 46 as permitting the court to respond to that procedural unfairness in ways including the appointment of a special advocate to represent the interests of an appellant. With great respect, I have concluded that such an interpretation is not open. If it were open, then the validity of s 46(2) would be much more finely balanced. The remainder of these reasons are concerned with the following steps toward my conclusion: (1) The Constitution does not prohibit all procedural unfairness. (2) Procedural unfairness must be justified. (3) The AAT Act does not permit balancing the interest of an appellant and the countervailing interest. (4) The ASIO Minister controls the extent of permitted disclosure. (5) The AAT Act does not authorise the appointment of a special advocate. 348 (2008) 234 CLR 532. 349 (2013) 252 CLR 38. 350 (2017) 263 CLR 1. 351 See Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51 at 103. Edelman (1) The Constitution does not prohibit all procedural unfairness In Garlett v Western Australia352, I explained the nature of the principle that derives from Kable v Director of Public Prosecutions (NSW)353 as one that is "based upon a presupposition in Ch III of the Constitution that Australian courts, including federal and State courts recognised in Ch III of the Constitution and possessing, or capable of possessing, federal jurisdiction, remain institutions of justice". The Kable principle has been expressed variously as one that is concerned with legislation that affects a court in a manner that is "incompatible with", or "repugnant to", or which "substantially impairs", its "institutional integrity" or role as a repository of judicial power354. The ultimate effect of the Kable principle is that there will come a point at which the administration of justice by a court is substantially impaired, either in the formal manner in which judicial power is exercised or in its substantive application, such that the court may no longer be seen as an institution of justice. The application of the Kable principle has become notoriously difficult to predict. Unmoored from any legal rules, it is a principle dripping with open texture: when is the administration of justice "impaired"? How much impairment is "substantial"? When is the exercise of power "repugnant to" the integrity of a court? What matters are part of the "institutional integrity" of a court? In relation to procedural fairness, it is not merely the outcome of the application of the Kable principle that is difficult to predict. There is also inconsistency in reasoning. Professor Gray has observed that some of the reasoning in this Court concerning an absolute constitutional limit upon Parliament's power, precluding a denial of procedural fairness by a court, is difficult to reconcile intellectually with other reasoning that would permit such denial in some circumstances. He asserts that if this Court "wishes to depart from its previous positions, it should state so"355. 352 [2022] HCA 30 at [242]. 353 (1996) 189 CLR 51. 354 See Fardon v Attorney-General (Qld) (2004) 223 CLR 575 at 591 [15], 598-599 [37], 617 [101], 648 [198], 655-656 [219]; Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 88-89 [123]; Attorney-General (NT) v Emmerson (2014) 253 CLR 393 at 424 [40]. See also Kuczborski v Queensland (2014) 254 CLR 51 at 98 [139]; Vella v Commissioner of Police (NSW) (2019) 269 CLR 219 at 245-246 [55]. 355 Gray, Criminal Due Process and Chapter III of the Australian Constitution (2016) Edelman On the one hand, members of this Court have said that to require a court to act contrary to procedural fairness "may well" be to require a court to act in a non-judicial manner356 and that a "defining characteristic" or "essential attribute" of a court is the application of procedural fairness357. Consequently, on this view, the institutional integrity of a court would be "distorted"358, or a court would act in a manner "repugnant to"359 the exercise of judicial power, if it no longer exhibited procedural fairness. It has been said that establishing a body as a court by legislation "means that any jurisdiction conferred on it is necessarily conditioned by the requirement that it observe procedural fairness"360. It has even been said that the essential character of a court necessitates that a court cannot be authorised to proceed in a manner that does not ensure the right of a party to meet the case against them361 or "at the very least" ensure a party "a fair opportunity to respond to evidence on which [a court] order might be based"362. On the other hand, it has also been said, sometimes even in the same cases, that "the hearing rule may be qualified by public interest considerations"363 and that open justice has "long been subject to qualifications"364. And the results in cases such as Gypsy Jokers365 and Pompano366 involve this Court upholding as 356 Leeth v The Commonwealth (1992) 174 CLR 455 at 470. 357 See Wainohu v New South Wales (2011) 243 CLR 181 at 208 [44]; Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 71 [67], 99 [156]; North Australian Aboriginal Justice Agency Ltd v Northern Territory (2015) 256 CLR 569 at 594 358 Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 71 [67]. 359 Hogan v Hinch (2011) 243 CLR 506 at 541 [45]. 360 Oakey Coal Action Alliance Inc v New Acland Coal Pty Ltd (2021) 95 ALJR 128 at 137 [47]; 386 ALR 212 at 222. 361 Nicholas v The Queen (1998) 193 CLR 173 at 208 [74]. 362 Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 108 [188]. 363 Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 72 [68]. 364 Hogan v Hinch (2011) 243 CLR 506 at 541 [46]. 365 (2008) 234 CLR 532. 366 (2013) 252 CLR 38. Edelman valid legislation that authorises a court to act in a manner that, at least in some circumstances, will be procedurally unfair. One way to resolve this tension might be on the basis that procedural fairness must look beyond fairness to a person. On this view, procedural fairness requires either a diluted notion of "fairness between the parties"367 or some philosophical notion of fairness of "process" abstracted from the individual and the decision-maker (the "process" being anthropomorphised with a mind capable of making decisions and taking actions368). If this view were taken, there might be circumstances in which strong countervailing interests could somehow make it "fair" for a court to order the deportation of a permanent resident of this country, without providing that person with: (i) the determinative evidence against them; (ii) an opportunity to respond to that evidence personally or through a person acting as a representative of their interests; or (iii) the determinative reasons for their deportation. No true notion of fairness could support such a conclusion. That is because fairness is individual. It is not a zero sum game. Its most basic rationale is respect for the human dignity of an individual369. The tension should be resolved in a different way. It should be accepted that it is always procedurally unfair, and individually unjust, to deprive a person of the right to be heard on any significant issue that might affect the final result of a proceeding. Nevertheless, for legislation to be constitutionally invalid, the institutional integrity of a court must be "substantially impair[ed]" by the absence of procedural fairness370. As Rawls wrote, "[b]y the principle of fairness it is not possible to be bound to unjust institutions, or at least to institutions which exceed the limits of tolerable injustice (so far undefined)"371. There will be instances of 367 International Finance Trust Co Ltd v New South Wales Crime Commission (2009) 240 CLR 319 at 355 [55]. 368 Compare Oakey Coal Action Alliance Inc v New Acland Coal Pty Ltd (2021) 95 ALJR 128 at 143 [81]; 386 ALR 212 at 230. 369 International Finance Trust Co Ltd v New South Wales Crime Commission (2009) 240 CLR 319 at 381 [144]; Hossain v Minister for Immigration and Border Protection (2018) 264 CLR 123 at 137 [40], 147-148 [72]; MZAPC v Minister for Immigration and Border Protection (2021) 95 ALJR 441 at 465 [100]; 390 ALR 590 at 614-615; Plaintiff M1/2021 v Minister for Home Affairs (2022) 96 ALJR 497 at 515 [53]; 400 ALR 417 at 433. 370 Wainohu v New South Wales (2011) 243 CLR 181 at 208 [44]; North Australian Aboriginal Justice Agency Ltd v Northern Territory (2015) 256 CLR 569 at 593-594 371 Rawls, A Theory of Justice, rev ed (1999) at 96. Edelman procedural unfairness where the injustice is tolerable, and the institutional integrity of the court is not substantially impaired, because the procedural unfairness is justified by a compelling countervailing interest and that injustice is the minimum that is reasonably necessary to protect that interest. Some of those instances might involve circumstances where relevant material held by one party is denied to the other party. As Gordon J explains in her reasons in this case372, there are exceptional cases where the substantial interest of one person justifies a court derogating from the procedural fairness generally afforded in adversarial litigation to another person: confidential information and trade secrets cases; legal professional privilege claims; a liquidator's application for an examination summons; and gender-restricted evidence in native title cases. These are circumstances in which a procedure that is less fair, or even potentially unfair, to one party has been repeatedly tolerated. The Solicitor-General of the Commonwealth was therefore correct to submit on this appeal that "a fair judicial procedure ... is not the only public interest in play". But that is not a licence for a court to be empowered or required to act unfairly in a wholesale manner. Two points must be made about those exceptional cases. First, none involves the extreme procedural unfairness of: (i) preventing a person, in a case them; involving serious consequences, from knowing (ii) preventing a person from responding to that case personally or through counsel; or (iii) depriving a person of reasons to explain why they lost. Such an extreme circumstance aptly fits the description given by Lord Neuberger of Abbotsbury MR in Al Rawi v Security Service373 of violating "an irreducible minimum requirement of an ordinary civil trial". the case against That extreme circumstance contrasts with gender-restricted evidence in native title cases, where the court can make orders to ensure that the evidence is available to legal representatives or anthropologists of the relevant gender374. It also contrasts with trade secrets cases, where, as Lord Dyson JSC observed375, it is "commonplace to deal with the issue of disclosure by establishing 'confidentiality rings' of persons who may see certain confidential material which is withheld from one or more of the parties to the litigation at least in its initial stages". Indeed, his Lordship added that he was not aware of any trade secrets case in which "one party 373 [2012] 1 AC 531 at 546 [30]. 374 See, eg, Western Australia v Ward (1997) 76 FCR 492 at 495. 375 Al Rawi v Security Service [2012] 1 AC 531 at 585 [64]. See also Mobil Oil Australia Ltd v Guina Developments Pty Ltd [1996] 2 VR 34 at 39-40; HT v The Queen (2019) 269 CLR 403 at 423 [44], 427-428 [58]. Edelman was denied access to evidence which was being relied on at the trial by the other party". Secondly, although many of these exceptional cases will involve procedural unfairness, that unfairness is justified by the strength of the countervailing interest and by confining the unfairness to the minimum degree that is reasonably necessary to protect that interest. For instance, in claims for public interest immunity or legal professional privilege, if the claim is upheld, the document cannot be used and no decision can be made adversely to a person in reliance upon the document. Further, even in the process of claiming the privilege, the party making the claim is required to set out, in evidence available to the other party to scrutinise and test, the facts from which the court can assess the basis for the claim of privilege in order to avoid unfairness to the other party376. And in public interest immunity claims, the unfairness to a party opposing the claim has sometimes been further mitigated such as by appointment of a special advocate, who might be chosen and paid for, at least in part, by that party377. Even in applications that are sometimes non-adversarial, such as judicial advice to trustees, for reasons of procedural fairness to interested parties, those applications are no longer commonly made ex parte and confidential expert opinions on matters of law are difficult to justify378. (2) Procedural unfairness must be justified In Vella v Commissioner of Police (NSW)379, four members of this Court said that "the boundaries of the Kable principle are not sharp" and clarity requires that the categories in which the principle applies "must develop in a principled, coherent, and systematic way rather than as evaluations of specific instances". This is particularly apparent in the tensions that have arisen, sometimes within the same cases or even the same judgments, in considering whether a denial of procedural fairness has so "substantially impaired" the institutional integrity of the court that it casts doubt upon its character as an institution of justice. 376 See Rinehart v Rinehart [2016] NSWCA 58 at [29]-[31]. 377 New South Wales v Public Transport Ticketing Corporation [No 3] (2011) 81 NSWLR 394 at 398 [20], 404 [34], 406 [40(g)]. 378 Plan B Trustees Ltd v Parker [No 2] (2013) 11 ASTLR 242 at 253 [43]. 379 (2019) 269 CLR 219 at 246 [56]. Edelman The starting point must be that, since procedural fairness can be variable in quality380, the mere fact that a procedure might be improved, or made fairer, is not sufficient to substantially impair the institutional integrity of a court. The procedure must be positively unfair. Some procedures might be less fair than others, or they might exhibit less than "absolute fairness", without crossing the threshold at which they become unfair381. Fairness is not a one-size-fits-all concept. Even procedural unfairness is not sufficient. As explained in the section above, there are exceptional cases which might sometimes involve procedural unfairness to one party but where that procedural unfairness is justified by the need to protect a countervailing interest. But the procedural unfairness must be no more than is reasonably necessary to protect that countervailing interest, and the interest must be sufficiently compelling. Although it was not put in these terms, there was effectively no dispute on this appeal that the countervailing interests in the three categories of confidentiality set out in s 39B(2) are sufficient to justify some procedural unfairness. Those categories in s 39B(2) include information that, if disclosed, would be contrary to the public interest: (i) because it would prejudice security or the defence or international relations of Australia; (ii) because it would involve disclosure of the deliberations or decisions of the Cabinet or a Committee of the Cabinet or of the Executive Council; or (iii) for any other reason that could form the basis for a claim in judicial proceedings of non-disclosure by the Crown in right of the Commonwealth. Whilst some circumstances in those categories might not involve considerations of great importance, others may. But even where the matter is of great importance, the existence of that strong countervailing interest cannot justify procedural unfairness beyond that which is reasonably necessary to protect the interest. Otherwise, the court would become an instrument of plain and unnecessary injustice. In forgoing any constraint that would require the minimisation of procedural unfairness, the submissions of the respondents overreached. The respondents' argument was that a countervailing interest set out in s 39B(2) could permit any procedural unfairness under the AAT Act because, if the Commonwealth Parliament had not legislated for an appellant to have a right of merits review and an "appeal" on a question of law, many of those who contested 380 Dietrich v The Queen (1992) 177 CLR 292 at 364; International Finance Trust Co Ltd v New South Wales Crime Commission (2009) 240 CLR 319 at 354 [54]; Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 99 [156], 105 [177], 111 [195]; HT v The Queen (2019) 269 CLR 403 at 417 [18], 430 [64]. 381 Jago v District Court (NSW) (1989) 168 CLR 23 at 49. See also Dietrich v The Queen (1992) 177 CLR 292 at 365; MZAPC v Minister for Immigration and Border Protection (2021) 95 ALJR 441 at 477 [160]; 390 ALR 590 at 630. Edelman adverse security assessments would fail. This is a submission that the end can always justify the means. In other words, the "gift" to an appellant of an administrative merits review hearing and an appeal on a question of law can justify requiring a court to act in a manner that so substantially impairs its institutional integrity that it may cease to be seen as an institution of justice. Such a submission has never been accepted in this Court. It cannot be accepted on this appeal. Similarly, it is a simple logical fallacy to treat the existence of some exceptional cases where the court's institutional integrity is not substantially impaired by the denial of procedural fairness as permitting legislation that authorises a denial of procedural fairness in any case at all. Without any constraint limiting procedural unfairness to that which is reasonably necessary to protect a strong countervailing interest, the Kable principle would not even prohibit Parliament from authorising judicial proceedings that treated an applicant for judicial review as though they were attending a dress rehearsal for a clown show. (3) The AAT Act does not permit balancing the interest of an appellant and the countervailing interest An "appeal" on a question of law under s 44 of the AAT Act is not an appeal in any legal sense. It is, instead, a proceeding in the original jurisdiction of the court382. It is in the nature of judicial review383. Although it is now common to conceive of the issue of a writ of certiorari in judicial review proceedings as quashing a decision, that was not the original role of the writ. Historically, the writ of certiorari was used only to remove the record of the proceedings to the court. It only became common practice at the end of the 19th century to combine a motion to quash a decision with an application for a writ of certiorari384. In other words, by the writ of certiorari385: "the Queen's Bench Division in England and the Supreme Courts of the colonies required the judges or officers of inferior jurisdictions to certify or send proceedings before them to the Queen's Bench or Supreme Courts. The proceedings were removed 'for the purpose of examining into the legality 382 Committee of Direction of Fruit Marketing v Australian Postal Commission (1980) 144 CLR 577 at 585. 383 See Roy Morgan Research Centre Pty Ltd v Commissioner of State Revenue (Vict) (2001) 207 CLR 72 at 79 [15]; Osland v Secretary to Department of Justice [No 2] (2010) 241 CLR 320 at 331-332 [18]-[19]. 384 Short and Mellor, Crown Practice (1890) at 110. 385 Re McBain; Ex parte Australian Catholic Bishops Conference (2002) 209 CLR 372 Edelman of such proceedings, or for giving fuller or more satisfactory effect to them than could be done by the Court below'". Section 46(1) of the AAT Act is a modern version of such a removal mechanism. On an "appeal" under s 44, the Tribunal is required by s 46(1)(a) to "cause to be sent to the Court all documents that were before the Tribunal in connexion with the proceeding to which the appeal ... relates and are relevant to the appeal". It was by this means that the documents in this case were before the court. Whether or not they were tendered by one of the parties, or incorporated into an "appeal" book, the documents formed part of the record for review by the court. As Gordon J observes in her reasons, four members of this Court in Gypsy Jokers386 said that the statutory regime in that case, which provided that tendered material was "for the court's use only", contemplated all that was necessary or appropriate for the exercise of jurisdiction to conduct the review. That regime readily accommodated the ability of the court to refuse to use material that was prejudicial to a respondent due to concerns of procedural unfairness. Similarly, as Gordon J also observes, the statutory regime considered in Pompano387 expressly contemplated a balancing exercise which took into account any procedural unfairness to the party deprived of the information. By contrast, the regime in this case contains no provision for the court to consider the interests of an appellant: the statutory presupposition in s 46(2) is that the court will consider the documents. This is unsurprising. It would not mitigate the procedural unfairness occasioned by s 46(2) for a court to refuse to consider s 44 material on an "appeal". Unlike the denial of procedural fairness to a respondent to an application under the legislative regime in Gypsy Jokers, a refusal by a court to consider s 44 material would exacerbate the procedural unfairness to an appellant. In many cases, such a refusal would make it impossible for an appellant, acting with propriety, even to make a submission that an error of law existed in the unredacted reasons for decision. Further, in many cases, it would be impossible for an appellant to demonstrate, or even to identify the existence of, an error of law without the court considering the underlying materials upon which the Tribunal relied. There is, therefore, no provision in the AAT Act for a court to mitigate the procedural unfairness occasioned by s 46(2) by any measure that has regard to both the interests of the appellant and the importance of the countervailing interest in s 39B(2). There is no power for a court to consider disclosure of some or all of the material by balancing that matter against the potential extreme procedural unfairness to an appellant, even where the public interest involved under s 39B(2) 386 (2008) 234 CLR 532 at 559 [35]; see also at 558 [30]. 387 (2013) 252 CLR 38. Edelman might be trivial, such as a minor aspect of the international relations of Australia or something at the low end of the spectrum of matters that could form the basis for a claim of privilege by the Crown in right of the Commonwealth in the documents. It may be a large step to say that such a trivial countervailing interest supports the non-disclosure of relevant documents that will never be used against a party. But it is a giant leap to say that such a trivial countervailing interest supports the non-disclosure of a document that will be used against a party. (4) The ASIO Minister controls the extent of permitted disclosure The literal terms of s 39B(2) appear to contemplate that a certificate issued by the ASIO Minister388 might be expressed in one of two manners. First, the ASIO Minister might certify that the "disclosure of information with respect to a matter stated in the certificate" would be contrary to the public interest because it falls within one or more of the three confidentiality categories. This would extend not merely to the most trivial instances within those categories but to anything "with respect to" those matters. In the context of confidentiality, the words "with respect to" have "a very wide meaning"389. They extend to anything that could have the potential to disclose the information. Secondly, the ASIO Minister might certify that "the disclosure of the contents of a document" would be contrary to the public interest because it falls within one or more of the three confidentiality categories. It was not submitted by any party to this appeal that there was any difference in substance between the two manners in which a certificate under s 39B(2) might be issued by the ASIO Minister. It was implicitly accepted by all parties that a certificate issued in either manner would express the "matter contained in the document" which, by s 46(2), the court must do all things necessary to ensure is not disclosed to any person other than a member of the court as constituted for the purposes of the proceeding. The decision of the ASIO Minister that a matter, however trivial, might fall within one or more of the three confidentiality categories, and the decision of the ASIO Minister as to the level of generality at which the "matter" in the certificate is expressed, will both significantly affect what the court is permitted to disclose. By leaving these powers to the ASIO Minister rather than the court, the court is deprived, without any reason or justification, of two means by which it might 388 The "ASIO Minister" is the Minister administering the Australian Security Intelligence Organisation Act 1979 (Cth): Administrative Appeals Tribunal Act 1975 (Cth), s 3(1). 389 See Technical Products Pty Ltd v State Government Insurance Office (Q) (1989) 167 CLR 45 at 47. See also Workers' Compensation Board (Q) v Technical Products Pty Ltd (1988) 165 CLR 642 at 653-654; Technical Products Pty Ltd v State Government Insurance Office (Q) (1989) 167 CLR 45 at 54. Edelman otherwise have been authorised to mitigate the extreme procedural unfairness to an appellant caused by the non-disclosure. This contrasts sharply with at least two ways in which the court might have been authorised to consider the reasonable necessity of the extreme procedural unfairness, and to mitigate it. First, provision could have been made requiring the ASIO Minister to provide evidence to the court that could justify the certification that a matter falls within a category in s 39B(2). This would have empowered the court to ensure that any procedural unfairness to an appellant is reasonably necessary. Although reference was made in submissions on this appeal to the mechanism of judicial review of a certificate given by the ASIO Minister, that mechanism affords almost no protection to the interests of an appellant. It would be nearly impossible for an appellant to obtain orders on judicial review quashing the certificate, given the likelihood of a claim for public interest immunity over the underlying material. Even making a submission to that effect is one of extreme difficulty390. In a submission designed to respond to the near-impossibility of judicial review of a certificate by an appellant, the Solicitor-General of the Commonwealth submitted that the court could review the validity of a certificate of its own motion. Although a court would not be required to do so391, it is theoretically possible that a court might seek to satisfy itself that the certificate was valid, establishing the jurisdictional fact in s 46(2) that "there is in force in respect of any of the documents a certificate"392. But even if a court did seek to satisfy itself of that validity, there is little more than a theoretical possibility at the very outer reaches of the realms of remoteness of the court concluding, without any evidence of the practical effect or consequences of the material being disclosed, that there is even a prima facie case that the ASIO Minister had no rational or reasonable basis to issue the certificate. Secondly, and compounding the first point, the court might have been authorised to disclose to an appellant, after submissions and evidence from interested parties including the ASIO Minister, the gist of the material where that was possible in a way that did not reveal, at the appropriate level of specificity, the "matter contained in the document" that the court (rather than the ASIO Minister) was satisfied required protection. 390 See Traljesic v Attorney-General (Cth) (2006) 150 FCR 199 at 212 [33]; Kim v Attorney-General (Cth) (2013) 215 FCR 228 at 252 [106]. 391 See Hussain v Minister for Foreign Affairs (2008) 169 FCR 241 at 256-257 [41]. 392 Compare Minister for Immigration and Border Protection v SZMTA (2019) 264 CLR 421 at 438 [18]-[19]. Edelman This way of mitigating procedural unfairness would allow the court to engage in what the Supreme Court of the United Kingdom described as "gisting"393. But by leaving the description of the "matter contained in the document", and therefore the decision about the level of generality at which it is expressed, to the ASIO Minister rather than the court, the extent to which any "gisting" is possible under s 46(2) is effectively controlled by the ASIO Minister. There is, again, little to no ability for the court to mitigate any procedural unfairness where the ASIO Minister has described the material at a high level of generality. The prospect of any review of the generality of the description of "the matter", either by an appellant or by the court of its own motion, is even further removed from the realms of reality than the prospect of any review of the certificate to ascertain whether the material falls within a category in s 39B(2). It can immediately be accepted that in any regime the importance of "countervailing interests of state security"394 might sometimes mean that even "gisting" is not possible, resulting in procedural unfairness. But there will be other cases where the force of such interests is not present. The court has little to no authority to mitigate that injustice. (5) The AAT Act does not authorise the appointment of a special advocate Another manner in which the procedural unfairness of s 46(2) might have been mitigated is by providing for the appointment of a special advocate to whom disclosure of the certified matter could be made, and who would represent the interests of an appellant, although without the ability to inform an appellant about the content of the certified matter. There would still remain significant procedural unfairness to an appellant due to the limited ability of the special advocate to obtain instructions relating to the material unless, after viewing the material, the special advocate were to make a successful judicial review application to invalidate the certificate and thus remove the legal barrier to disclosure to the appellant of the material. But the availability of a special advocate to represent the interests of an appellant would have been a significant step towards ensuring that the procedural unfairness was no more than is reasonably necessary to protect the countervailing interest. The Solicitor-General of the Commonwealth submitted that, if it were necessary to save the validity of s 46, it was open to apply the power in s 46(4) in a manner that extended to appointment of a special advocate. That sub-section provides that nothing in s 46 "prevents the disclosure of information or of matter 393 R (Haralambous) v Crown Court at St Albans [2018] AC 236 at 253 [14], 272-273 394 See R (Haralambous) v Crown Court at St Albans [2018] AC 236 at 273 [63]. Edelman contained in a document to an officer of the court in the course of the performance of his or her duties as an officer of the court". Even if, with or without the saving grace of s 15A of the Acts Interpretation Act 1901 (Cth), the application of "an officer of the court" could extend to a special advocate, s 46(4) would still fall short of a regime that could permit the appointment of a special advocate who could represent the interests of an appellant. It is arguable that an existing statutory regime for the appointment of a special advocate, coupled with either an inherent or a general power of the court to protect its own processes from injustice, could permit the extension of the special advocate regime to related circumstances395. It is also arguable that a court has the power to appoint a special advocate for the limited purpose of assisting with issues concerning public interest immunity to establish the admissible evidence or record, rather than the actual deployment of evidence or consideration of the record396. But, in the absence of a statutory regime, there is no power for a court to appoint a special advocate to mitigate the procedural unfairness that arises from matters including an inability to access the very record upon which the court is to adjudicate. The many policy and functional decisions required to create a scheme for appointment of a special advocate in the context of a final judicial adjudication are not matters that can be resolved by a court. Those decisions are the province of the legislature, as can be seen by comparison with the statutory regime for the appointment of a special advocate in the National Security Information (Criminal and Civil Proceedings) Act 2004 (Cth) ("the NSICCP Act"). First, an immediate question that would need to be confronted is who is suitable for appointment as a special advocate? In matters that might involve highly sensitive Commonwealth issues, what level of security clearance is necessary? How is the court to judge the level of sensitivity of the information? How is the court to know whether the special advocate has any conflict of interest that should prevent them from accessing the information? The NSICCP Act makes careful provision for these issues. A court may only appoint a person as a special advocate if: (i) the person meets any requirements specified in the regulations397, which include that the person has 395 R v Collaery [No 11] (2022) 364 FLR 418. 396 New South Wales v Public Transport Ticketing Corporation [No 3] (2011) 81 NSWLR 394 at 405 [38]. 397 National Security Information (Criminal and Civil Proceedings) Act 2004 (Cth), s 38PA(2)(a). Edelman received relevant training398, meets the satisfaction of the Attorney-General399, is an eligible former judge, an eligible senior counsel or an eligible legal practitioner400, and is not otherwise disqualified401; and (ii) the court has given the parties legal representatives, the opportunity to make submissions about who the court should the Attorney-General, and the proceedings and their Further, in order to avoid the prospect of conflicts of interest, regulations made under the NSICCP Act provide that a special advocate must give the court written notice of all interests that the special advocate has or acquires that conflict, or could conflict, with the proper performance of their functions, or the exercise of their powers403. Secondly, what are the boundaries of the role of the special advocate? Can the special advocate take any instructions from the appellant prior to seeing the material? How should communication occur after the special advocate has seen the material? Could the special advocate be the subject of a subpoena to reveal any instructions given by the party whose interests are to be represented? The NSICCP Act provides for the special advocate to represent the interests of the party in the proceeding, but limits that role to making written and oral submissions, adducing evidence, and cross-examining witnesses at any part of a hearing in the proceeding during which the party and the party's legal representative are not entitled to be present404. The NSICCP Act provides that the special advocate may only communicate with the party and the party's legal 398 National Security Information (Criminal and Civil Proceedings) Regulation 2015 (Cth), s 20A(b). 399 National Security Information (Criminal and Civil Proceedings) Regulation 2015 (Cth), s 20A(d). 400 National Security Information (Criminal and Civil Proceedings) Regulation 2015 (Cth), s 20A(a). 401 National Security Information (Criminal and Civil Proceedings) Regulation 2015 (Cth), s 20A(c). 402 National Security Information (Criminal and Civil Proceedings) Act 2004 (Cth), s 38PA(2)(b). 403 National Security Information (Criminal and Civil Proceedings) Regulation 2015 (Cth), s 20C. 404 National Security Information (Criminal and Civil Proceedings) Act 2004 (Cth), s 38PB. Edelman representative in written communication approved by the court405. The party and the party's legal representative may only communicate with the special advocate in writing, and the party may only do so through their legal representative406. But the NSICCP Act also provides that, although the relationship between the special advocate and the party is not that of legal representative and client, legal professional privilege applies407. Thirdly, if the special advocate is appointed by the court, who is to pay the fees of the special advocate? And does the special advocate obtain the protection of counsel immunity? Regulations made under the NSICCP Act provide that the special advocate may charge the Commonwealth in accordance with the Legal Services Directions 2017 (Cth) or at a higher rate as the Attorney-General approves408. They further provide that no action, suit, or proceeding may be brought against a special advocate in relation to anything done, or omitted to be done, in good faith by the person in the performance of their functions or the exercise of their powers as a special advocate409. Conclusion The Kable principle invalidates legislation where it substantially impairs the institutional integrity of a court such that the court may cease to be seen as an institution of justice. If anything more than lip service is to be paid to that principle, it should apply where a court is required to act in a manner that perpetuates extreme procedural unfairness upon an individual in circumstances where that unfairness is not reasonably necessary to protect a compelling countervailing interest. On the only interpretation of s 46 of the AAT Act which I consider to be open, the extreme procedural unfairness contained in s 46(2) is an unfairness that is plainly beyond that which is reasonably necessary to protect the compelling interests in s 39B(2). 405 National Security Information (Criminal and Civil Proceedings) Act 2004 (Cth), ss 38PF(2)(b), 38PF(3)-(6). 406 National Security Information (Criminal and Civil Proceedings) Act 2004 (Cth), s 38PF(8)-(9). 407 National Security Information (Criminal and Civil Proceedings) Act 2004 (Cth), s 38PC. 408 National Security Information (Criminal and Civil Proceedings) Regulation 2015 (Cth), s 20B. 409 National Security Information (Criminal and Civil Proceedings) Regulation 2015 (Cth), s 20E. Orders should be made as proposed by Gordon J. Edelman STEWARD J. I agree with Kiefel CJ, Keane and Gleeson JJ that s 46(2) of the Administrative Appeals Tribunal Act 1975 (Cth) ("the AAT Act") is a valid law of the Commonwealth. Generally, for the reasons given by their Honours, the decisions of this Court in Gypsy Jokers Motorcycle Club Inc v Commissioner of Police410 and in Condon v Pompano Pty Ltd411 necessarily foreclose the proposition advanced by the appellant that a "baseline" and elementary standard of procedural fairness exists which must be upheld in every case. It was said that whenever a court is required to make an order that finally alters or determines a right or legally protected interest of a person without affording that person a "fair opportunity" to respond to evidence on which that order might be made, that baseline is offended, and the court thereby acts inconsistently with Ch III of the Constitution412. Such a proposition is, with great respect, too broadly expressed. There are narrow circumstances where a court may justifiably deny an applicant a fair opportunity to respond to evidence deployed against them without causing "practical injustice"413. I, otherwise, and with very great respect, differ with some parts of the reasons of Kiefel CJ, Keane and Gleeson JJ. Those differences are explained below. In addition, for the reasons that follow, I do not consider that s 46(2), properly construed, necessarily prevents the Federal Court of Australia from affording such a fair opportunity in every case. The applicable statutory scheme In considering whether the Federal Court could afford a person such as the appellant a fair opportunity to meet adverse allegations, one must commence with the statutory scheme. The Minister administering the Australian Security Intelligence Organisation Act 1979 (Cth) ("the ASIO Act"; "the ASIO Minister") here issued four certificates pursuant to s 39A of the AAT Act. That provision prescribes the power of the Administrative Appeals Tribunal ("the AAT") to review the correctness of security assessments made by the first respondent ("the Director-General") in accordance with Div 2 of Pt IV of the ASIO Act. Section 39A was introduced into the AAT Act by the Law and Justice Legislation Amendment Act (No 1) 1995 (Cth). In general terms, this Act abolished the former Security Appeals Tribunal and transferred relevant functions of that Tribunal to a 410 (2008) 234 CLR 532. 411 (2013) 252 CLR 38. 412 Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 105 [177] per 413 Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 99 [156] per Hayne, Crennan, new Security Division of the AAT. Section 39A was modelled on what was previously s 58 of the ASIO Act414. Section 39A was drafted to resolve two potentially conflicting interests. On the one hand, there is the need for an applicant to be afforded procedural fairness. Section 39A serves that objective in various ways: by giving an applicant who has been issued with a security assessment an opportunity for merits review of that assessment by an independent tribunal (s 39A(1)); by imposing a "duty" on the Director-General to present to the AAT "all relevant information available ... whether favourable or unfavourable to" an applicant (s 39A(3)); by giving the AAT the power to require either or both parties to attend or be represented in order to identify the matters in issue or to facilitate the conduct of the hearing (s 39A(4)); subject to a qualification, by giving an applicant a right to be present when the AAT is hearing submissions made or evidence adduced by the Director-General or the governmental agency to which the security assessment was given (s 39A(6)); by giving an applicant a right to adduce evidence and make submissions to the AAT (s 39A(13)); by giving the AAT the right to invite, on its own initiative, a person to give evidence, or to summon a person to give evidence (s 39A(14)); and by obliging the AAT, subject to what follows, to give a party an opportunity to give further evidence where the AAT considers that such a party "should be further heard" (s 39A(16)). On the other hand, there is the public interest in preserving the secrecy of highly sensitive information in the possession of the Director-General concerning Australia's security. This is reflected in the provisions of the ASIO Act. Section 17(1)(a) of the ASIO Act provides, amongst other things, that a function of ASIO is to "obtain, correlate and evaluate intelligence relevant to security". Section 17(1)(b) provides further that a function of ASIO is also to communicate such intelligence "for purposes relevant to security". However, pursuant to s 18 of the ASIO Act, such a communication can only be made by the Director-General or a person acting with the Director-General's authority; otherwise, it is generally an offence to disclose intelligence gathered by ASIO (s 18(2)). The term "security" is defined in s 4 as follows: "security means: the protection of, and of the people of, the Commonwealth and the several States and Territories from: espionage; 414 Australia, House of Representatives, Law and Justice Legislation Amendment Bill (No 3) 1994, Explanatory Memorandum at 7 [32]. sabotage; (iii) politically motivated violence; promotion of communal violence; attacks on Australia's defence system; or acts of foreign interference; whether directed from, or committed within, Australia or not; and the protection of Australia's territorial and border integrity from serious threats; and the carrying out of Australia's responsibilities to any foreign country in relation to a matter mentioned in any of the subparagraphs of paragraph (a) or the matter mentioned in paragraph (aa)." The public interest in protecting the confidentiality of secret intelligence gathered by ASIO has long been recognised by this Court. Because of the special nature of that public interest, the Director-General's obligation to give discovery in a given case has usually been regarded as limited in nature. Thus, in Church of Scientology v Woodward, Brennan J observed415: "[D]iscovery would not be given against the Director-General save in a most exceptional case. The secrecy of the work of an intelligence organization which is to counter espionage, sabotage, etc. is essential to national security, and the public interest in national security will seldom yield to the public interest in the administration of civil justice." (citation omitted) Section 39A of the AAT Act also recognises this public interest. Pursuant to s 39A(5), the hearing of a proceeding concerning the correctness of a security assessment must take place in private. If the Director-General so requests, the AAT must do all things necessary to ensure that the identity of a person giving evidence on behalf of the Director-General is not revealed (s 39A(11)). Pursuant to s 39A(9), an applicant and their representative must be excluded from proceedings when certified "evidence" is adduced or certified "submissions" are made to the AAT. Evidence or submissions may be certified if disclosure of such material 415 (1982) 154 CLR 25 at 76. See also R v Lewes Justices; Ex parte Secretary of State for Home Department [1973] AC 388 at 407 per Lord Simon of Glaisdale; Leghaei v Director-General of Security (2007) 241 ALR 141 at 147 [52] per Tamberlin, would be contrary to the "public interest because it would prejudice security or the defence of Australia" (s 39A(8)). Some observations should be made about these provisions. First, the AAT does not itself decide whether particular evidence or submissions should be certified; rather, that is a matter reserved to the ASIO Minister. Secondly, the scope of what evidence and what submissions may not be disclosed is a matter determined in accordance with what each certificate identifies and describes. Thirdly, the validity of a certificate can be challenged, on judicial review grounds, in a court416. A precondition for the lawfulness of a given certificate would be whether the ASIO Minister had acted within the bounds of legal reasonableness and on a correct understanding of the law, in certifying that the disclosure of evidence or a submission would be contrary to the public interest417. Where a certificate describes evidence and submissions in only a highly generalised or broad fashion, that may show that the ASIO Minister has misunderstood what is in the public interest for the purposes of s 39A(8). That may be because the boundaries of what evidence and what submissions cannot be disclosed are circumscribed only by what it is in the public interest to keep secret. The validity of a certificate may also be susceptible to challenge before the AAT, even though any opinion formed by that Tribunal concerning that issue would have no binding legal effect. Nonetheless, in determining its procedures under s 39A, the AAT is entitled to form a view as to whether a certificate given by the ASIO Minister is, in a given case, valid418. The ASIO Minister also issued certificates pursuant to s 39B(2) of the AAT Act. Section 39B was also inserted into the AAT Act in 1995, and was modelled on what was previously s 59 of the ASIO Act419. It is central to this appeal. Like s 39A, s 39B includes rules which promote procedural fairness and rules which protect sensitive material from disclosure. The section only applies to a proceeding to which s 39A applies (s 39B(1)). Unlike s 39A, which applies to "evidence" and to "submissions", s 39B applies to the non-disclosure of "information with respect 416 Hussain v Minister for Foreign Affairs (2008) 169 FCR 241 at 258 [47]-[48] per Weinberg, Bennett and Edmonds JJ. See also Traljesic v Attorney-General (Cth) (2006) 150 FCR 199; Kim v Attorney-General (Cth) (2013) 215 FCR 228. 417 Minister for Immigration and Border Protection v SZMTA (2019) 264 CLR 421 at 438 [19] per Bell, Gageler and Keane JJ. 418 Minister for Immigration and Border Protection v SZMTA (2019) 264 CLR 421 at 438 [18] per Bell, Gageler and Keane JJ; cf Collector of Customs (NSW) v Brian Lawlor Automotive Pty Ltd (1979) 24 ALR 307. 419 Australia, House of Representatives, Law and Justice Legislation Amendment Bill (No 3) 1994, Explanatory Memorandum at 7 [32]. Steward to a matter stated in the certificate" or the "contents of a document". Pursuant to s 39B(2), the ASIO Minister may certify that disclosure of information or the contents of a document would be contrary to the public interest for one of three reasons: first, because it would prejudice security or the defence or international relations of Australia; secondly, because it would involve disclosure of Cabinet documents and the like; or thirdly, because the information or the contents of the document could be the subject of a claim for public interest immunity. Consistently with the public interest in maintaining confidentiality over sensitive intelligence held by ASIO, the AAT must "do all things necessary" to prevent disclosure of certified information or the certified contents of a document to anyone other than a member of the Tribunal (s 39B(3)). Even without a certificate, the AAT is obliged to ensure that information is not made available to a person "contrary to the requirements of security" (s 39B(11)). However, consistently with the need to provide procedural fairness, the giving of a relevant certificate does not excuse a person who is required by the AAT Act to disclose information or to produce a document to the AAT (eg pursuant to s 39A(3)) from performing that duty. In addition, if a given certificate does not invoke, as a reason for non-disclosure, either of the first or second reasons set out above, the presiding member may authorise the disclosure of the information, or of the contents of the document, to the applicant, if the member is satisfied that the "interests of justice" outweigh the reason given for non-disclosure (s 39B(5)). In so deciding, the member must have regard to the desirability that the parties should be made aware of all relevant matters (s 39B(6)). The observations I have made about the certification of evidence or submissions for the purposes of s 39A apply equally to the certification of information or the contents of a document for the purposes of s 39B. Pursuant to s 43AAA of the AAT Act, the AAT must, generally speaking, make findings about whether a security assessment was correct and then disclose those findings to the applicant, the Director-General, the ASIO Minister, and the Commonwealth agency, State or State authority to which the assessment was given. Section 43AAA(5) empowers the AAT to direct that the whole or a part of its findings are not to be given to the applicant or to the applicable Commonwealth agency, State or State authority. Significantly, it is the AAT that is empowered to decide what findings, or parts thereof, are not to be disclosed. In making such a decision, the AAT must comply with its obligation of non-disclosure in relation to any certified information and the certified contents of any document for the purposes of s 39B(3), as well as its duty in relation to information pursuant to s 39B(11). A finding may, no doubt, be expressed without breaching these obligations because, for example, of the use of highly generalised language. Pursuant to s 44 of the AAT Act, a party may relevantly "appeal" a decision of the Security Division to the Federal Court. The appeal is generally limited to Steward "question[s] of law"420. Pursuant to s 45, the AAT may, with the agreement of its President, refer a question of law to the Federal Court for decision. In either case, pursuant to 46(1)(a), and despite s 39B(2) and (3), the AAT must send to the Federal Court "all documents that were before the Tribunal in connexion with the proceeding to which the appeal or reference relates and are relevant to the appeal or reference". Section 46(2) provides that where, relevantly, there is in respect of any of the "documents" a certificate "in force" in accordance with s 39B(2) certifying that disclosure of a "matter contained in the document" would be "contrary to the public interest", the Federal Court shall "do all things necessary to ensure that the matter is not disclosed to any person other than a member of the court as constituted for the purposes of the proceeding". Section 46(4) creates an exception to this rule for disclosure to "an officer of the court in the course of the performance of his or her duties as an officer of the court". Section 46(3) permits disclosure of a "matter" in circumstances similar to those set out in s 39B(5) as described above. The following observations about s 46 should be made. First, the reference in s 46(2) to a certificate certifying the non-disclosure of a matter contained in a document is apt to refer to a certificate made pursuant to s 39B(2) that identifies the contents of a document that should not be disclosed. Secondly, the reference in s 46(2) to a certificate "in force" should, in context, be read as a reference to a certificate that has not been withdrawn, or to a certificate the validity of which has not been successfully challenged in a court. Thirdly, s 46(2) does not address the admissibility into evidence of any certified document, or part thereof, in the Federal Court. Nor does it directly seek to interfere with the Federal Court's obligation to conduct a fair hearing. Instead, having been given custody of documents from the AAT, s 46(2) simply prohibits the Court from itself disclosing any certified matters contained in those documents to anyone other than a member or officer of the Court. Whilst s 44 of the AAT Act refers to an appeal to the Federal Court, and whilst the Federal Court Rules 2011 (Cth) refer to a person filing a "notice of appeal"421 for that purpose, the Court nonetheless exercises its original, and not appellate, jurisdiction when hearing any such appeal422. Upon the filing of a notice of appeal, r 33.18 of the Federal Court Rules then obliges the Registrar of the AAT to lodge with the Registry of the Federal Court "a copy of the decision", a "copy of the reasons" (if any), a copy of the transcript (if any), and a list of the documents sent to the Court pursuant to s 46(1) of the AAT Act. Curiously, in a case where 420 As to what is a "question of law", see generally Haritos v Federal Commissioner of Taxation (2015) 233 FCR 315. 421 Rule 33.12. 422 Federal Court of Australia Act 1976 (Cth), s 19(2). Steward the AAT has redacted its reasons in accordance with s 43AAA(5) of the AAT Act, r 33.18 does not specify whether the decision to be lodged is the redacted copy, the unredacted copy, or both. Pursuant to r 33.23(1), an applicant must file an appeal book, which must include423: "the formal decision of the Tribunal and the reasons for the decision"; a "complete index of the record of the evidence in the Tribunal"; a "chronological list of all documents received in evidence"; a "list of the affidavit evidence"; a "list of exhibits"; and the "exhibits and evidence to which the parties refer in the parties' submissions". Pursuant to r 33.24, a Registrar of the Federal Court must settle the index for Part A of the appeal book (dealing with the core set of standard items) as well as for Part B (a comprehensive reference index). These Rules are silent as to how an applicant, even with the assistance of a Registrar of the Federal Court, is to comply with this obligation where s 39B certificates have been issued. However, pursuant to r 33.22, the Federal Court may give directions "for determining what documents and matters were before the Tribunal" and concerning the "contents of the appeal book". In a case where certificates have been issued pursuant to s 39B, this will require the Court to take such steps as it can, consistently with its obligation under s 46(2), to ensure that the record of what was before the AAT is, to the extent the applicant requires it, included in the appeal book. It does not follow from the foregoing process for the filing of the AAT decision and of an appeal book that the material is thereby before the Court. The preparation of the appeal book conveniently identifies the material the parties wish to rely upon. But if a party wishes to rely upon documents that were before the AAT, then the documents will need to be tendered into evidence. It is the act of tendering the documents and having them adduced into evidence that places them before the Court424. That act may be express or, as is sometimes the case with appeals pursuant to s 44 of the AAT Act, it may be implied from the joint conduct of the parties in relying upon the contents of an agreed appeal book. In that respect, the supply of documents to the Federal Court pursuant to s 46 of the AAT Act is not analogous to the provision by an inferior court to a superior court of the "record" of that lower court in judicial review proceedings. That "record" only comprises the documentation that initiates a proceeding, the 423 Rule 33.26. 424 Evidence Act 1995 (Cth), s 48. pleadings (if any) and the adjudication425. It has never included the evidence before the lower court or the transcript (if any)426. It follows that the act of supplying documents, including certified documents, to the Federal Court pursuant to s 46 does not result in the Court being obliged to receive them into evidence or otherwise to consider them. Section 46(1) simply provides a means of transporting the documents to the Court, and implicitly thereafter authorises their ongoing custody by the Court until their return to the AAT in accordance with s 46(1)(b). Section 46 otherwise does not oblige the Court to do anything with the documents, save for the obligation of non-disclosure imposed by s 46(2). The capacity to afford procedural fairness The Federal Court's capacity to ensure that it relevantly provides procedural fairness – including for the purposes of making directions pursuant to r 33.22, settling certain parts of a proposed appeal book, and considering a tender (whether express or implied) of documents contained in an appeal book – is not inhibited by s 46(2) of the AAT Act, save that, if the obligations of procedural fairness required the Court itself to disclose certified documents, or their contents, to an applicant, it could not do so. However, the capacity of a court to alter its ordinary procedures to secure a measure of procedural fairness, or to ameliorate procedural unfairness arising from the need to maintain a competing interest, is well known. As Kiefel CJ, Bell and Keane JJ observed in HT v The Queen427: "It should not be assumed that procedural fairness should altogether be denied in order that sensitive information be kept confidential. Just as the principle of open justice has been held to yield to the need to do justice in a particular case, so must the requirements of natural justice in a particular case yield to some extent." (footnote omitted) Their Honours then observed428: "It is well known that the courts have modified and adapted the content of the general rules of open justice and procedural fairness in particular kinds of cases. ... [E]ach case has to be decided on its own facts 425 Hockey v Yelland (1984) 157 CLR 124 at 142-143 per Wilson J. 426 Hockey v Yelland (1984) 157 CLR 124 at 143 per Wilson J; Craig v South Australia (1995) 184 CLR 163 at 180-182 per Brennan, Deane, Toohey, Gaudron and 427 (2019) 269 CLR 403 at 423 [43]. 428 (2019) 269 CLR 403 at 423 [44]. Steward and on the broad principle that the court has the task of deciding how justice can be achieved taking into account the rights and needs of the parties. The relevant party should have as full a depth of disclosure as would be consistent with the adequate protection of the secret." In my view, the last sentence of the foregoing passage is the decisive consideration. On one view, it is unfair, in the colloquial sense of that word, for evidence to be admitted and then deployed against a party without that party having an opportunity to see that evidence and then to test its accuracy and probative value. But as the reasons of Kiefel CJ, Keane and Gleeson JJ explain, practical injustice is not a necessary consequence of the denial of such an opportunity429. Moreover, even where, by reason of s 46(2), the Federal Court itself cannot supply certified documents to an applicant, any resulting unfairness might nonetheless be capable of being cured in a number of different ways in order to ensure that "justice can be achieved"430. In a given case, those solutions may be less or more effective; indeed, in some cases, they may not be effective at all. Everything will depend on the given circumstances. But nothing in s 46(2) expressly addresses the duty of the Court to avoid presiding over an unfair trial. Some of the possible ways of fulfilling that duty include the following. First, it would be open to the Court to order that the gist of certified documents be disclosed by the Director-General to an applicant. So long as this fell short of disclosing any certified matters, the Solicitor-General of the Commonwealth accepted that such an order would be permissible, unless the countervailing interests of state security made that impossible. The communication of the gist of information which is immune from disclosure on public interest grounds has been developed by the courts in the United Kingdom in the interests of procedural fairness. In R (Haralambous) v Crown Court at St Albans, Lord Mance DPSC observed431: "As a matter of principle, open justice should prevail to the maximum extent possible. Any closed material procedure 'should only ever be contemplated or permitted by a court if satisfied, after inspection and full consideration of the relevant material as well as after hearing the submissions of the special advocate, that it is essential in the particular case': Tariq v Home Office [2012] 1 AC 452, para 67; and should, of course, be restricted as far as possible. Further, the nature of the issue may require, 429 See [67]. 430 HT v The Queen (2019) 269 CLR 403 at 423 [44] per Kiefel CJ, Bell and Keane JJ. 431 [2018] AC 236 at 272 [61]. Steward as a minimum, disclosure of the 'gist' of the closed material, to enable the person from whom it is withheld to address the essence of the case against him: A v United Kingdom (2009) 49 EHRR 29, Secretary of State for the Home Department v AF (No 3) [2010] 2 AC 269 (a control order case). This will be so, where the issue affects the liberty of the person". The reference in the foregoing passage to a "closed material procedure" is to a court in judicial review proceedings receiving and considering confidential evidence that cannot be disclosed due to public interest immunity, which is equivalent, in substance, to the procedure provided for by s 46 of the AAT Act. The rationale for such a procedure is to enable judicial review to be "effective" where a lower tribunal or court has considered the very material subject to public interest immunity432. The references in s 46(2) to a "matter contained in [a] document" and to "the contents of a document" in s 39B(2) are references not only to what is actually said in a document but also to the substance of what has been said. However, acceptance of the proposition that disclosure of the gist of a certified document might, in a given case, be communicated to an applicant without breaching s 46(2) suggests that a high-level summary of what has been said in a certified document may not constitute disclosure of either the contents of a document or a matter contained in it. For example, the type of activity alleged might be communicated without the need to identify the specifics of what took place, the names of individuals involved, or other like details. Such a generalised disclosure might not be contrary to the public interest. Having said that, there may be occasions when even disclosing the general nature of an activity might, by reason of its nature, imperil, for example, the safety of a foreign informant. As the Victorian Court of Appeal recognised in Chief Commissioner of Police v Nikolic433, there is no minimum standard of "gisting" that applies in every case; in some contexts, "the importance of protecting highly sensitive information may have the consequence that the principles of procedural fairness do not require the disclosure of even the substance or gist of that information to the person who is the subject of the decision in question"434. Plainly, what might be disclosed would depend on the particular facts and circumstances. Secondly, both the Commonwealth accepted, although with some hesitation, that it was possible for the Solicitor-General of the appellant and 432 R (Haralambous) v Crown Court at St Albans [2018] AC 236 at 269 [52] per Lord Mance DPSC. 433 (2016) 338 ALR 683. 434 (2016) 338 ALR 683 at 703 [74] per Maxwell P, Osborn and Kaye JJA. Steward the Federal Court to appoint a special advocate who could examine certified material and unredacted reasons and make independent submissions to the Court. Such an advocate would do so subject to an obligation not to say or do anything that might tend to disclose certified material to an applicant. It was also accepted, however, that this would only be possible if such a special advocate could constitute an "officer of the court" for the purposes of s 46(4) of the AAT Act. In National Archives of Australia v Fernandes435, Foster J rejected a submission that the phrase "officer of the court" in s 46(4) should include any lawyer acting on behalf of a party. That is plainly correct. But in reaching this conclusion, his Honour decided that the phrase "officer of the court" only referred to "public servants employed in the Court to assist the judges in the performance of their judicial function"436. With respect, that construction of the phrase is too narrow. In New South Wales v Public Transport Ticketing Corporation [No 3]437, Allsop P (as his Honour then was) observed that whilst there was no statutory foundation for the appointment of a special advocate in public interest immunity cases, the Supreme Court of New South Wales had an inherent power to do so where disclosure to the special advocate did not injure the public interest and where there existed exceptional circumstances438. With respect, that conclusion is correct, although the need for exceptional circumstances in every case may be doubted. The Federal Court has the same inherent power, arising as it does from a court's jurisdiction to do that which is incidental to its judicial function439. An independent lawyer appointed by the Court to be a special advocate to assist it in exercising judicial power is an "officer of the court" for the purposes of s 46(4); such a person holds an office, that of special advocate, and does so at the direction of and for the benefit of the Court in the discharge of its duty to afford procedural fairness. That interpretation is more consistent with the constitutional imperative that the Court adhere to the requirement to provide procedural fairness in its exercise of federal judicial power440. 435 (2014) 233 FCR 461. 436 (2014) 233 FCR 461 at 468 [44(a)]. 437 (2011) 81 NSWLR 394. 438 (2011) 81 NSWLR 394 at 397 [10]. 439 New South Wales v Public Transport Ticketing Corporation [No 3] (2011) 81 NSWLR 394 at 397 [15]. 440 Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 71 [67] per French CJ, 99 [156] per Hayne, Crennan, Kiefel and Bell JJ; Acts Interpretation Act 1901 (Cth), s 15A. In Public Transport Ticketing Corporation, Allsop P also usefully explained the procedural fairness dilemma that can arise when a party is denied access to relevant material, and how this can be ameliorated by the appointment of a special advocate. His Honour said441: "There are a number of circumstances in which the courts have been faced with a handicap or a difficulty in efficiently or justly resolving an aspect of a dispute where one party cannot see the material upon, or in respect of which, the court must adjudicate. Fairness may be compromised because the nature of the right or privilege asserted or claimed is one that excludes the other party from an examination of relevant material, but to disclose it to the other party for the purpose of resolving the claim of right would destroy that very right (if legitimately claimed). Further, fairness may be compromised by the court examining the material without a contradictor. This is, in part, alleviated by the recognition that the hearing without the substantive participation of the other party will have features of an ex parte application, thereby requiring appropriate disclosure from the party claiming the right. Nevertheless, it is easily seen how the other party may feel less than fully satisfied with the decision of the court, the foundation of which it cannot know or understand. Further, efficiency, to a degree, is impeded. A court, without a contradictor, must seek to understand the litigious context of the claim of right and assess it with only one side assisting. ... The promotion of fairness and expedition in the resolution of proceedings may be seen to justify the court, in a proper case and without destroying or affecting the right concerned, making a properly fashioned order for the employment of a special counsel to make submissions in relation to documents or information to which the other party is not privy. The circumstances of what is a proper case and the fashioning of the order to avoid any deleterious effect on the claimed right will be particular to each case. It will be important, in the fashioning of such orders, to retain a focus upon substance, not form or labels. Thus, what I have said by way of general approach could extend to the appointment of an amicus curiae or assessor who could be seen as acting on behalf of, and assisting, the court in a manner that would support the conclusion that the right to non-publication beyond the court's necessary examination of the documents had not been affected or breached". The use of a special advocate as a contradictor to assist the court, and as a means of mitigating any procedural unfairness, is a device known in the United 441 (2011) 81 NSWLR 394 at 398 [19]-[20]. Steward Kingdom and in Canada. In Secretary of State for the Home Department v MB442, Lord Hoffmann adopted the following description of the "Canadian procedure" given by the Grand Chamber of the European Court of Human Rights443: "[A] Federal Court judge holds an in camera hearing of all the evidence, at which the applicant is provided with a statement summarising, as far as possible, the case against him or her and has the right to be represented and to call evidence. The confidentiality of security material is maintained by requiring such evidence to be examined in the absence of both the applicant and his or her representative. However, in these circumstances, their place is taken by a security-cleared counsel instructed by the court, who cross- examines the witnesses and generally assists the court to test the strength of the State's case. A summary of the evidence obtained by this procedure, with necessary deletions, is given to the applicant." The foregoing represents a sensible combination of both the appointment of special advocate and the disclosure of the gist of the certified documents. Lord Hoffmann made the following additional observations about the adoption of the Canadian procedure in the United Kingdom444: "The Canadian model is precisely what has been adopted in the United Kingdom, first for cases of detention for the purposes of deportation on national security grounds (as in Chahal) and then for the judicial supervision of control orders. From the point of view of the individual seeking to challenge the order, it is of course imperfect. But the Strasbourg court has recognised that the right to be informed of the case against one, though important, may have to be qualified in the interests of others and the public interest. The weight to be given to these competing interests will depend upon the facts of the case, but there can in time of peace be no public interest which is more weighty than protecting the state against terrorism and, on the other hand, the Convention rights of the individual which may be affected by the orders are all themselves qualified by the requirements of national security. There is no Strasbourg or domestic authority which has gone to the lengths of saying that the Secretary of State cannot make a non- derogating control order (or anything of the same kind) without disclosing material which a judge considers it would be contrary to the public interest to disclose. I do not think that we should put the Secretary of State in such an impossible position and I therefore agree with the Court of Appeal that 442 [2008] AC 440 at 484-485 [51]-[54]. 443 Chahal v United Kingdom (1996) 23 EHRR 413 at 472 [144]. 444 [2008] AC 440 at 485 [54]. in principle the special advocate procedure provides sufficient safeguards to satisfy [the right to a fair hearing]." Of course, the terms of appointment of a special advocate by an order of the Court would need to be carefully calibrated to the needs of a given appeal. Orders of the kind made in the Public Transport Ticketing Corporation case illustrate this. They included: an order for the nomination of a special advocate; an order for the obtaining of initial instructions from the excluded party before giving the special advocate access to the confidential material; an order that the special advocate not disclose the contents of that confidential material to anyone other than the Court and the relevant State body; an order that the special advocate make submissions to the Court; and an order that the excluded party pay the costs of the special advocate in the first instance445. It may also be accepted that the utility of the appointment of a special advocate will depend upon the circumstances of the case. There will be cases where, because disclosure to an applicant of even the gist of the allegations made is not possible, the special advocate will be unable to obtain sufficient instructions from the applicant. There will also be cases where, even with disclosure of the gist of what is alleged, adequate instructions may not be capable of being given. In such cases, the special advocate may be unable to give the court any real assistance. But such possibilities may ultimately and practically prove largely to be illusory given that appeals to the Federal Court pursuant to s 44 of the AAT Act are almost always limited to questions of law; an inability to obtain instructions will often have little practical effect on the capacity of the special advocate to make submissions to the Court about the presence of error. In any event, notwithstanding the difficulties that might arise in a given case, it does not follow that the appointment of a special advocate could never cure any shortcoming in procedural fairness in a given case. Thirdly, to the extent the Director-General sought to tender documents, whether in whole or part, that were the subject of certification pursuant to s 39B(2), it would be open to the Court to require, as a condition of admission into evidence, those documents, or parts of those documents, to be shown to an applicant's legal representatives on a confidential basis. The Court, cognisant of the ethical obligations owed by an applicant's legal representatives to the administration of justice, has the ability to mould the conditions and restrictions governing the disclosure of certified materials by the Director-General on a case-by-case basis with a view to balancing, to the extent possible, the competing imperatives of national security and procedural fairness446. No such direction would involve the Court itself failing to do "all things necessary to ensure" that certified matters in 445 (2011) 81 NSWLR 394 at 405-406 [40] per Allsop P. 446 cf R v Khazaal [2006] NSWSC 1061 at [33]-[39] per Whealy J. the documents held by the Court pursuant to s 46(1) were not disclosed to another person. The Solicitor-General of the Commonwealth agreed with this proposition. Whether the Director-General, as a model litigant, would be obliged to tender certified documents is not a matter that needs to be decided. The foregoing is not intended to be an exhaustive list of the means by which the Federal Court could afford a sufficient degree of procedural fairness, or a sufficient reduction in any procedural unfairness, in appeals from the Security Division of the AAT. In respect of each appeal, the Court will need to mould what relief can be given to overcome the disadvantage suffered by the applicant as a result of the provision to the Court, but not to the applicant, of certified material. If, notwithstanding the aforementioned options, the Court considers that it cannot sufficiently mitigate the disadvantage suffered by the applicant and that to proceed with the appeal without affording the applicant a fair opportunity to respond to the case against them would be productive of practical injustice, it is not compelled to do so. Contrary to what might be assumed, neither s 46(1) nor s 46(2) obliges the Federal Court to adopt a "closed material procedure"447 in an appeal from a decision of the Security Division of the AAT. As previously explained, s 46(1) provides for the transfer of documents to the Federal Court, and s 46(2) prohibits disclosure of certified material to any person other than a member of the Federal Court. But the provisions do not compel the Court to adopt any other specific course of action448. In Al Rawi v Security Service, Lord Kerr of Tonaghmore JSC said of the closed material procedure adopted in the United Kingdom449: "The defendants' second argument proceeds on the premise that placing before a judge all relevant material is, in every instance, preferable to having to withhold potentially pivotal evidence. This proposition is deceptively attractive – for what, the defendants imply, could be fairer than an independent arbiter having access to all the evidence germane to the dispute between the parties? The central fallacy of the argument, however, lies in the unspoken assumption that, because the judge sees everything, he is bound to be in a better position to reach a fair result. That assumption is misplaced. To be truly valuable, evidence must be capable of withstanding challenge. I go further. Evidence which has been insulated from challenge may positively mislead. It is precisely because of this that the right to know the case that one's opponent makes and to have the opportunity to challenge 447 See R (Haralambous) v Crown Court at St Albans [2018] AC 236. 448 cf Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 105 [177]-[178] per 449 [2012] 1 AC 531 at 592-593 [93]. Steward it occupies such a central place in the concept of a fair trial. However astute and assiduous the judge, the proposed procedure hands over to one party considerable control over the production of relevant material and the manner in which it is to be presented. The peril that such a procedure presents to the fair trial of contentious litigation is both obvious and undeniable." In a given case, it would be open to a judge, mindful of the concerns of Lord Kerr, to decline a tender of certified documents or otherwise to refuse to consider documents certified pursuant to s 39B of the AAT Act. But there will be other cases where it will be justifiable for a judge to consider the certified documents, especially when urged to do so by an applicant and where this will make adjudication of the questions of law the subject of the appeal more "effective". In neither of those scenarios is a judge compelled to preside over a hearing that would be productive of practical injustice. That is because, even where the Court declines to consider the certified documents transmitted to it pursuant to s 46(1) of the AAT Act, it would remain open to the Court, in the exercise of its original jurisdiction, to revert to the principles and procedures that would have governed the appeal in the absence of s 46 – including, for example, the rules of public interest immunity, which would almost certainly apply to deny both the appellant and the Court any access to certified material450. For the reasons explained below and by Kiefel CJ, Keane and Gleeson JJ451, that counterfactual position forecloses the appellant's contention that s 46 mandates the adoption of an unfair procedure. Because the duty and the capacity of the Court to provide different forms of procedural fairness, of the kind described above, are not necessarily precluded by s 46(2) of the AAT Act, it is a valid law. If it were otherwise, like Gordon J and Edelman J, I may well have formed the view that s 46(2) was not a valid law. It follows that what in substance divides us is the way we construe s 46(2). Appeal not inimical to the exercise of judicial power As mentioned, there will be appeals where, by reason of the nature of the certified material, the Federal Court will not be able to provide an applicant with a fair opportunity to respond to the evidence against them by any of the above means. The certified material may be so sensitive that any form of disclosure would be too dangerous. The possibility of such a case, however, of itself does not make s 46(2) an invalid law. That is because this type of appeal, even with its 450 See SDCV v Director-General of Security (2021) 284 FCR 357 at 396 [161]-[162] per Bromwich and Abraham JJ. 451 See [75]-[83]. Steward adoption of an unfair procedure, is not inimical to an exercise of federal judicial power. In that respect, one commences with the observation that some degree of caution should be exercised in drawing implications from the essential nature of judicial power which fetter the exercise of legislative or executive authority. That is because, as Kitto J famously observed, "it has not been found possible to frame an exhaustive definition of judicial power"452. Indeed, Sir Owen Dixon, writing extra-judicially, once remarked that the doctrine of the separation of powers was an "artificial and almost impractical classification"453. In determining here what is inimical to the exercise of judicial power, one cannot consider the operation of s 46, to the extent that it has inhibited, or even denied, the provision of the usual norms of procedural fairness, in isolation. If an appeal from the Security Division is ultimately and otherwise beneficial to an applicant, justice is not denied but is served. And that is so even though, as Edelman J observes, the resulting procedure adopted by the Court may be seen, in and of itself, to be unfair – indeed, in some cases, acutely so. The provisions of the AAT Act concerning merits review of security assessments reflect choices made by the Parliament to enhance the rights of applicants who have been the subject of adverse security assessments, whilst at the same time preserving the confidentiality of intelligence held by the Director- General in the public interest. It is a legislative scheme that comprises a carefully balanced solution to conflicting rights and interests and that, when originally enacted in the ASIO Act, was a breakthrough in the common law world. Thus, in the Second Reading Speech for the Bill that became the ASIO Act, the following was noted454: "The statutory procedures for notification of security assessments and for rights of appeal in large part implement the recommendations of Mr Justice Hope. They represent the first attempt, at least in a common law country, to provide a comprehensive statutory framework regulating the making of security assessments of individuals and providing a right of appeal to an independent judicial tribunal. They therefore represent one of 452 R v Trade Practices Tribunal; Ex parte Tasmanian Breweries Pty Ltd (1970) 123 CLR 361 at 373. 453 Dixon, "The Law and the Constitution", in Crennan and Gummow (eds), Jesting Pilate and Other Papers and Addresses, 3rd ed (2019) 170 at 181. 454 Australia, House of Representatives, Parliamentary Debates (Hansard), 22 May the most important steps taken in this Parliament for many years directed to the protection of the rights of individuals." The Second Report of the Hope Royal Commission on Intelligence and Security, which recommended the establishment of a statutory right of merits review of security decisions in what is now the Security Division of the AAT, records Hope J's acute recognition of the need to balance private and public rights. His Honour described the "central problem" of a proposed security appeals system as "the difficulty of reconciling the needs and rights of the state with the needs and rights of the individual"455. Hope J wrote456: "The understandable desire of individuals to have all the rules of natural justice applied to security appeals must be denied to some extent, unfortunate though this may be. ... I do not think, however, that a security appeals system in which the appellant always had the right to hear all the evidence and to cross-examine all the witnesses, without restriction, would be either possible or desirable. In some cases, it may not be possible to inform the appellant of the whole of the case against him, although he must always be told as much of that case, and all the rules of natural justice must be applied as fully as is consistent with the national interest. The most common difficulty in any appeal against a security assessment is the protection of intelligence sources. ... If this protection is to be maintained, despite the existence of an appeals system, it will be necessary for the appeals tribunal to be able to allow evidence to be given in the absence of the appellant or his representatives, to be able to disallow cross-examination, and to admit hearsay evidence. Indeed, the description of some material relied upon to support an adverse or qualified assessment may be such as to identify the source. It may therefore be necessary to limit or totally to prohibit the giving of information in relation to that material to the appellant. These propositions derogate from the rules of natural justice, but they have been proved necessary in other countries which respect those rules. They are justified, and are only justified, by reference to the security of the nation. In some cases, in addition to the protection of sources, the security issue involved in the case may be so sensitive that to give any information concerning it to the appellant will be impossible." 455 Australia, Royal Commission on Intelligence and Security: Second Report (1977) at 456 Australia, Royal Commission on Intelligence and Security: Second Report (1977) at The provisions of the AAT Act, described above, faithfully implement Hope J's concerns and reflect a measured "trade-off" between the need to protect the security interests of the nation and the benefit of providing independent merits review of security assessments. The resulting legislation is plainly beneficial. It is even more beneficial with the existence of judicial oversight pursuant to s 44 of the AAT Act. Without this regime, a person who has been the subject of an adverse security assessment would have a less effective right of appeal from a decision of the Security Division. That is because it is practically inevitable in such proceedings that the Director-General would successfully claim public interest immunity over certified documents457, and the Court would be unable to understand fully the reasons of the AAT based on all of the evidence that was before it. Parliament has sought to avoid such an iniquitous result by enacting appeal rights which provide for the possibility of the Court considering all of that evidence. It follows that an appeal from the Security Division of the AAT to the Federal Court – notwithstanding the limitations imposed on the Court by s 46(2) of the AAT Act, which, in a given case, may deprive an applicant of a fair opportunity to respond to adverse evidence – is nonetheless beneficial to a litigant in the position of the appellant. For that reason, the adoption by the Court of such a procedure does not result in an applicant suffering "practical injustice"458, and is not inconsistent with Ch III of the Constitution. In unadorned terms, the regime is better than nothing. In the context of a clearly recognised public interest in protecting the non-disclosure of highly sensitive intelligence, s 46(2) is a valid and necessary law of the Commonwealth, which forms part of an otherwise beneficial regime. Edelman J would criticise the foregoing conclusion as an example of an end justifying the means. With respect, that may well be so. But it nevertheless represents an acceptance that in order to provide an applicant in circumstances such as these with a meaningful – as distinct from meaningless – chance of independent review with subsequent judicial oversight, there is a necessary and regrettable cost that may need to be incurred. In this context, that cost does not offend justice. I agree with the orders proposed by Kiefel CJ, Keane and Gleeson JJ. 457 Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532 at 550-551 [5] per Gleeson CJ, 556 [23]-[24] per Gummow, Hayne, Heydon and Kiefel JJ. See also Church of Scientology v Woodward (1982) 154 CLR 25 at 60 per Mason J, 76 per Brennan J; R v Khazaal [2006] NSWSC 1061 at [30]-[32] per Whealy J; Leghaei v Director-General of Security (2007) 241 ALR 141 at 147 [52] per Tamberlin, Stone and Jacobson JJ. 458 Condon v Pompano Pty Ltd (2013) 252 CLR 38 at 99 [156] per Hayne, Crennan,

HIGH COURT OF AUSTRALIA THE QUEEN AND APPLICANT RESPONDENT The Queen v Taufahema [2007] HCA 11 21 March 2007 ORDER Special leave to appeal granted. Appeal allowed. Set aside the order of the New South Wales Court of Criminal Appeal made on 8 May 2006 entering a verdict of acquittal and in its place order that there be a new trial. On appeal from the Supreme Court of New South Wales Representation N R Cowdery QC with D M L Woodburne and J A Girdham for the applicant (instructed by Solicitor for Public Prosecutions (New South Wales)) T A Game SC with G A Bashir for the respondent (instructed by Legal Aid Commission of New South Wales) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS The Queen v Taufahema Criminal law – Joint criminal enterprise – Extended common purpose – Respondent alleged to be party to a joint criminal enterprise – Respondent convicted of murder – Appeal against conviction allowed on the ground of a wrong direction on a question of law – Conviction quashed and verdict of acquittal entered. Criminal law and procedure – Retrial – Whether the verdict of acquittal should be set aside and a new trial ordered – Whether retrial can be ordered where the classification of the joint criminal enterprise differs from that presented at the first trial – Whether difference of classification constitutes a new case not made at the first trial – Meaning of "new case" – Whether retrial appropriate where case at trial adopted by prosecution for tactical reasons – Whether granting retrial on a "new case" is consistent with even-handed disposition of criminal appeals. Courts – Court of Criminal Appeal – Criminal Appeal Act 1912 (NSW), s 8(1) – Discretion of Court of Criminal Appeal to order new trial upon successful appeal against conviction – Circumstances to be taken into account. Courts – High Court of Australia – Practice and procedure – Special leave to appeal – Application by Crown for special leave to appeal against a verdict of acquittal entered by a Court of Criminal Appeal – Circumstances to be taken into account. Words and phrases – "new case", "foundational crime", "extended common purpose". Crimes Act 1900 (NSW), ss 18, 33B, 546C. Criminal Appeal Act 1912 (NSW), ss 5(1), 6(1), 6(2), 8(1). GLEESON CJ AND CALLINAN J. Following a trial in the Supreme Court of New South Wales before Sully J and a jury, the respondent was convicted of the murder of Senior Constable Glenn McEnallay. He was sentenced to imprisonment for 23 years, with a non-parole period of 16 years. He appealed against his conviction. The Court of Criminal Appeal (Beazley JA, Adams and Howie JJ) allowed the appeal and quashed the conviction1. The Court of Criminal Appeal declined to order a new trial, and entered a verdict of acquittal. That aspect of the orders of the Court of Criminal Appeal is the subject of the present application. The applicant does not challenge the quashing of the conviction, but contends that there should be a new trial. Although it is submitted that the Court of Criminal Appeal erred in declining to order a new trial, the argument now advanced by the applicant in support of such an order was not put to that Court, and the applicant has made it clear that, at a new trial, the case against the respondent would differ in certain respects from the case argued at the original trial and in the Court of Criminal Appeal. The death of Senior Constable McEnallay Senior Constable McEnallay was shot and killed by Sione Penisini, who was convicted of murder following a plea of guilty. The charge against the respondent was based upon his alleged complicity in the conduct of Sione Penisini. The relevant legal principles, which are not in dispute, will be identified below. First it is necessary to state, in summary form, the circumstances said to have given rise to such complicity. At about 5.30 pm on 27 March 2002, two police officers, who were off duty, saw a green Holden car travelling at excessive speed in a Sydney suburban area. They noted the registration number. They reported what they had seen to Senior Constable McEnallay, a highway patrol officer who was in the vicinity. He made radio enquiries, and learned that the vehicle had been reported stolen some months earlier. Soon afterwards, he saw the vehicle. In it there were four men. Senior Constable McEnallay called for assistance, and drove up behind the vehicle. The vehicle increased speed, and he pursued. The pursuit was brief. The Holden collided with an obstacle on the road and stopped. Sione Penisini, one of the passengers, left the vehicle with a loaded revolver in his hand, and fired a number of shots into the police car from close range, mortally wounding Senior Constable McEnallay. The four men, each armed with a revolver, ran away. They were chased by police officers who had arrived at the scene shortly after the shooting of Senior Constable McEnallay. Three of the men (including the respondent) were captured immediately. One was arrested some days later. 1 Taufahema v The Queen (2006) 162 A Crim R 152. Callinan Apart from Sione Penisini, the other three men in the Holden were the respondent, who was the driver, the respondent's brother, John Taufahema, and Meli Lagi. All four men were on parole at the time of the incident. That was a matter of significance in the prosecution case. Apart from the weapons which each man carried when running away from the police, the police found, in or near the Holden, two pairs of gloves and a hockey mask. In outlining the prosecution case for the purpose of a pre-trial ruling on evidence, the prosecutor said: "It is the Crown case that the motive for the shooting and the motive for attempting to escape from the pursuing police ... was the fact that each of them was on parole; that each of them was in possession of a firearm, in a reported stolen vehicle, which firearm was loaded and also found in the vehicle was a mask and gloves of the type that would readily be used to effect disguise for the purpose of carrying out crime of some sort." The prosecution case was that the four men all understood that, if apprehended, they would have been found to be in breach of their parole conditions, and would have been returned to prison to complete their sentences in custody. The respondent was charged with, and convicted of, unauthorised possession of a Smith and Wesson .357 revolver. That conviction is not the subject of this application. He was also charged with, and convicted of, murder. Criminal complicity The murder charge against the respondent was based on secondary liability. The principal offender was Sione Penisini. Under s 18 of the Crimes Act 1900 (NSW) ("the Crimes Act"), Sione Penisini was guilty of murder because it was his act which caused the death of the police officer, and that act was done with intent to kill or inflict grievous bodily harm, or with reckless indifference to human life. Since he fired at Senior Constable McEnallay from close range, there was a compelling inference that he acted with intent to kill or inflict grievous bodily harm. The principle of secondary liability of present relevance was stated by Brennan CJ, Deane, Dawson, Toohey and Gummow JJ in McAuliffe v The Queen2: "The doctrine of common purpose applies where a venture is undertaken by more than one person acting in concert in pursuit of a common criminal design. Such a venture may be described as a joint criminal enterprise. Those terms – common purpose, common design, concert, joint criminal enterprise – are used more or less interchangeably (1995) 183 CLR 108 at 113-114. Callinan to invoke the doctrine which provides a means, often an additional means, of establishing the complicity of a secondary party in the commission of a crime. The liability which attaches to the traditional classifications of accessory before the fact and principal in the second degree may be enough to establish the guilt of a secondary party: in the case of an accessory before the fact where that party counsels or procures the commission of the crime and in the case of a principal in the second degree where that party, being present at the scene, aids or abets its commission. But the complicity of a secondary party may also be established by reason of a common purpose shared with the principal offender or with that offender and others. Such a common purpose arises where a person reaches an understanding or arrangement amounting to an agreement between that person and another or others that they will commit a crime. The understanding or arrangement need not be express and may be inferred from all the circumstances. If one or other of the parties to the understanding or arrangement does, or they do between them, in accordance with the continuing understanding or arrangement, all those things which are necessary to constitute the crime, they are all equally guilty of the crime regardless of the part played by each in its commission. Not only that, but each of the parties to the arrangement or understanding is guilty of any other crime falling within the scope of the common purpose which is committed in carrying out that purpose. Initially the test of what fell within the scope of the common purpose was determined objectively so that liability was imposed for other crimes committed as a consequence of the commission of the crime which was the primary object of the criminal venture, whether or not those other crimes were contemplated by the parties to that venture. However, in accordance with the emphasis which the law now places upon the actual state of mind of an accused person, the test has become a subjective one and the scope of the common purpose is to be determined by what was contemplated by the parties sharing that purpose." The principle referred to in the second of the above paragraphs is sometimes described as "extended common purpose"3. In Clayton v The Queen4, the majority gave the following example: "If a party to a joint criminal enterprise foresees the possibility that another might be assaulted with intention to kill or cause really serious 3 Clayton v The Queen (2006) 231 ALR 500 at 504 [14]. (2006) 231 ALR 500 at 504-505 [17]. Callinan injury to that person, and, despite that foresight, continues to participate in the venture, the criminal culpability lies in the continued participation in the joint enterprise with the necessary foresight."5 If the alleged common criminal design, or the joint criminal enterprise, in this case had been the shooting of Senior Constable McEnallay, the case would have been one of common purpose of the kind described in the first of the two paragraphs from McAuliffe quoted above. A case of extended common purpose is one that alleges that the shooting occurred as an incident in the pursuit of some different criminal enterprise, but was foreseen by the respondent as a possibility, the respondent's culpability lying in the participation in the enterprise with such foresight. The total time that elapsed between the first observation of Senior Constable McEnallay by the four men in the Holden and the fatal shooting was less than one minute. According to the applicant, it was probably closer to 20 seconds. The prosecution set out to satisfy the jury, first, that the respondent was a party to a criminal enterprise and, secondly, that the nature of the enterprise was such that the respondent could and did foresee the shooting as a possible outcome of the pursuit of the enterprise. Bearing in mind the sequence of events and the time frame, the development of a plausible case of extended common purpose was not without its problems. If four criminals, suddenly confronted by a police officer, flee, it is not self-evident that they are doing so in pursuance of an understanding or arrangement to flee. It is at least possible that they have decided individually that flight is a good idea. One thing, however, is clear. It was not the prosecution case at trial, or in the Court of Criminal Appeal, that the joint criminal enterprise which formed the foundation of the respondent's secondary liability for murder extended in time beyond the period between the first observation of the victim by the four men in the Holden and the shooting of the victim by Sione Penisini. Specifically, it was not the prosecution case at trial that this was, to take up an expression used in the applicant's submissions in this Court, "an armed robbery gone awry". An armed robbery is a joint criminal enterprise, and often it would be plausible to suggest that one of the participants foresaw the possibility that another participant would make hostile and fatal use of a weapon. At trial, the prosecution did not attempt to prove that the four men were on their way to commit an armed robbery. In the course of a pre-trial argument about the admissibility of certain evidence, Sully J remarked that the evidence about the way in which the men were equipped indicated that they "were obviously up to no good and the odds are they were going to commit a 5 See also Gillard v The Queen (2003) 219 CLR 1; Chang Wing-Siu v The Queen [1985] AC 168; Hui Chi-ming v The Queen [1992] 1 AC 34; R v Powell [1999] 1 Callinan robbery". However, he went on to disclaim any suggestion that such a case could be left to the jury, and the prosecutor did not seek to make out such a case. Being "up to no good" is not a sufficiently particular description of a joint criminal enterprise. Suspicion that the men were "going to commit a robbery" is one thing; proof is another. The prosecution did not invite the jurors to find that this was a case of "an armed robbery gone awry", and Sully J did not direct them that it was open to make such a finding. The specification of the joint criminal enterprise for the application of the principles of criminal complicity inevitably influenced the course of the trial. It was central to the trial judge's decision to admit certain evidence; it explained certain features of the conduct of the defence case; and it determined the way in which the prosecution case was left to the jury. The course of the trial Before the respondent was arraigned, there was argument, and a ruling by the trial judge, about the admissibility of evidence that all four occupants of the Holden were on parole. Reference has been made earlier to the prosecution submission about the motive of the men in avoiding arrest. The prosecution argued that the evidence was relevant to motive, and that, in applying s 137 of the Evidence Act 1995 (NSW), Sully J should accept that the probative value of the evidence outweighed the danger of unfair prejudice. Sully J, ruling that the evidence was admissible, said: "The Crown contends that that evidence is admissible, in particular against the accused at his trial, for the reason that it shows that he, the accused, had a strong motive to adhere, individually, to a joint criminal enterprise, namely, the avoidance by all or any of the four men of their lawful apprehension by the police, the shooting of Constable McEnallay having been an incident of the carrying out of that enterprise." As the prosecution case was opened to the jury (although not as the case was finally left to the jury) it was in one respect different from the case as understood by Sully J in his pre-trial ruling on evidence. In his opening, the prosecutor said: "It is the Crown case that the accused was a party to a joint criminal enterprise that involved the use of a firearm by Sione Penisini; that that joint criminal enterprise was to use a firearm to prevent their lawful arrest, and detention by police ... [i]n this case Constable McEnallay, and it is contemplated during the course of that use of a firearm by this accused, that is his contemplation of the use of the firearm by Sione Penisini involved the possibility that there might be death or a serious injury occasioned. It is in that way that the Crown says that this Callinan accused is also guilty of murder, notwithstanding that he didn't fire any shots at all." That way of putting the case did not necessarily involve extended common purpose. Sione Penisini fired at Senior Constable McEnallay from close range. If there had been a joint criminal enterprise to use a firearm, that is to say, a concerted plan, to which the respondent was a party, to use a firearm to prevent arrest, in the circumstances it is difficult to imagine what kind of use might have been in prospect other than the use that in fact occurred. If there had been a joint plan, to which the respondent was a party, to use a firearm to prevent arrest, and the way in which the men intended to avoid arrest was that one of them would get out of the car and shoot at the police officer, then no extension of ordinary principles of common purpose would be necessary in order to make the respondent liable for culpable homicide. There was, however, no direct evidence of any such joint plan. It is not clear that it should have been inferred. In any event, as the trial progressed, the case altered. The alleged joint criminal enterprise to use a firearm to prevent arrest became, as foreshadowed by Sully J in his pre-trial ruling, simply a joint enterprise to evade arrest, and the conduct of Sione Penisini became, not conduct to which the respondent had agreed and which he had planned, but merely conduct which he foresaw as a possibility. Such a case may have been easier to prove factually. The prosecutor said he acted on "the KISS principle ..., that is keeping it simple". Plainly, it was a tactical decision, calculated to narrow the area of possible doubt, and therefore to make the prosecution case easier to establish. Two points should be noted. First, in the present application the prosecution does not seek to put, or to be given another opportunity to put, a case of the kind opened and later withdrawn: a case that there was an agreement (in the sense explained in McAuliffe), to which the respondent was a party, that Sione Penisini would get out of the car and shoot the police officer. A case of murder on that basis would be straightforward legally, although factually difficult, but it is no longer the prosecution case, and ceased to be so during the trial. Secondly, the case the prosecution now seeks to make (extended common purpose founded on a joint criminal enterprise of armed robbery, of which the shooting was a foreseen incident) was never put at any stage of the trial. Although, and perhaps because, the prosecution did not undertake the task of proving that the four men in the Holden were on their way to an armed robbery, the defence called evidence to show that three of the men, but not the respondent, were planning a robbery, or a series of robberies, in Melbourne. This, presumably, was to explain the contents of the vehicle, in a manner that exculpated the respondent. The respondent gave evidence about how he came to be driving the car, and about his movements on the day in question. Then the defence called a witness, Manuel Cackau, who said that he was to be the fourth man in the planned robberies. The plan, he said, was that he, Sione Penisini, Callinan John Taufahema and Meli Lagi, would drive to Melbourne. The jury might well have regarded the evidence of the respondent and Manuel Cackau as implausible, but in the way the case was finally left to them that hardly mattered. In cross- examining the respondent, the Crown prosecutor did not put it to him that he was intending to participate in an armed robbery. The prosecutor put to the respondent that, being on parole, he knew that if he was caught with a gun he was in trouble. At the close of the evidence, and before final addresses, there was discussion, in the absence of the jury, about the way the case would be left to the jury. Some of that is presently irrelevant. What is of importance is the way in which the joint criminal enterprise relied upon by the prosecution was refined and defined. This was reflected in the prosecutor's address and in the trial judge's summing-up. In his address to the jury, the prosecutor said: "Here, the Crown says that there was a joint criminal enterprise to escape from lawful apprehension or detection by the men in the car; and the Crown says that in the course of carrying out that escape, one of them, Sione Penisini, shot at the policeman deliberately and fired those shots in such a way that they caused fatal wounds that he so unfortunately suffered. He did so whilst participating, the Crown says, in a joint criminal enterprise that all four men had embarked upon ... and were continuing upon at the time he fired the shots. For this accused to be guilty, the Crown says that he had to be participating in a joint criminal enterprise, namely, one of escaping jointly with the others or commonly with the others, from lawful apprehension by the police; that when he did so, he contemplated that a firearm might be used in some way to effect their escape; and that with that knowledge he contemplated a risk that death or serious injury might be caused, even unintentionally, by one of the participants; and that having contemplated that risk, he is guilty of the murder if one of the participants in the joint criminal enterprise caused the death of someone." The expression "even unintentionally" appears to invite error, but that is beside the present point. Between the opening and closing addresses of the prosecutor the alleged joint criminal enterprise had been watered down, to the tactical advantage of the prosecution. No longer did the prosecution need to establish a joint plan to shoot Constable McEnallay. There was now said to be merely a joint enterprise to escape from lawful apprehension by the police. The respondent was said to have contemplated that a firearm might be used in some Callinan way to effect the escape. The jurors were told that this was enough to convict the respondent of murder. The trial judge gave the jury both written and oral directions as to the principles of criminal complicity and the application of those principles to the case. In his written directions he said: "The simplest approach is to ask whether the Crown has satisfied you beyond reasonable doubt: that the actions of the four men who were travelling in the [Holden] then being driven by the accused, give rise to an they had reached [an] agreement or inference understanding that all four of them would jointly evade lawful apprehension by [Senior Constable McEnallay]; and that that the accused then knew that there was at least one loaded revolver then being carried in the vehicle; and that the accused realised that, in the circumstances and the atmosphere then obtaining, there was a risk that any one of the men in the [Holden] might fire that weapon at the police officer; and that in such an event there was a real risk that the police officer might be killed or at least seriously injured; and that such risks crystallised in the shooting in fact by Penisini of the police officer. If you are so satisfied beyond reasonable doubt, then this accused is as responsible as Penisini for the death of that police officer." On that way of putting the case against the respondent, the joint enterprise was identified as evasion of lawful apprehension by Senior Constable McEnallay. It was not necessary for the prosecution to establish any agreement to shoot (or shoot at, if in the circumstances of this case there is a difference) the police officer. All that was necessary was for the respondent to realise that there was a risk that, in carrying out the agreement to evade apprehension, one of the other men in the car might shoot at the police officer. There remained, of course, the factual question: if four men, suddenly confronted by a police officer, try to get away, what is it that demonstrates that they have agreed to do so? Agreement is the key to this form of secondary liability. Without that, the case fails. There was a legal problem with the way the case was left to the jury. Evading apprehension by a police officer is not itself a crime. There are certain Callinan crimes that a person might commit in the course of evading apprehension. Section 33 of the Crimes Act makes it an offence maliciously to shoot at any person with intent to resist lawful apprehension. Section 33B makes it an offence to use, or attempt to use, or threaten to use an offensive weapon with intent to prevent or hinder lawful apprehension. There are other cognate offences, one of which was raised in argument in the Court of Criminal Appeal. The way in which the prosecution originally put its case identified a joint enterprise which, if it existed, was criminal. However, it may have been harder to establish factually. Ultimately, the enterprise relied on was expressed in a way that was open to legal criticism. Trial counsel for the respondent complained about this change in the prosecution case, but to no avail. The jury convicted, and there is no reason to doubt that they followed what the trial judge described as the simplest approach to their task. The decision of the Court of Criminal Appeal The only ground of appeal to the Court of Criminal Appeal that is of present relevance was that the trial judge misdirected the jury on joint criminal enterprise and common purpose. It was submitted, among other things, that the "foundational crime" put to the jury was "not open as a matter of law". In the course of written and oral argument in the Court of Criminal Appeal the prosecution did not seek to maintain that evading lawful apprehension is itself necessarily a crime, but argued that Sully J had in mind the offence created by s 546C of the Crimes Act, that is, resisting or hindering a member of the police force in the execution of his duty. In Leonard v Morris6, Bray CJ said of the corresponding South Australian provision that hindering involves any form of interference or obstruction which makes the duty of a police officer substantially more difficult of performance. He did not define resisting. Adams J, with whom Beazley JA and Howie J agreed, said: "The Crown contended in this Court that the foundational crime was that created by s 546C of the Crimes Act 1900. Whilst not resiling, in terms, from the case put below, that the foundational offence was evading arrest, the Crown prosecutor in this Court contended that another available offence was that of hindering the officer in the execution of his duty. One major obstacle in the way of this submission is that such a case was not put at trial. (1975) 10 SASR 528 at 530-532. Callinan It was submitted that the word 'hinder' is a word of ordinary parlance without any special meaning and that its usual definition (for example, that in the Shorter Oxford English Dictionary) is 'to keep back, delay, impede, obstruct, prevent'. By not stopping the [Holden] when Senior Constable McEnallay signalled that he should do so by operating the siren and the flashing lights on his vehicle, it is submitted that the [respondent] sought to delay or impede an impending lawful arrest. (I interpolate that, the officer undoubtedly wished the vehicle to heed the signals and stop but whether he was then intending to arrest anybody is uncertain.) The Crown also contends, relying on the fact that all four offenders fled the scene, that they had agreed that they would run away from the officer and that the agreement to run away was an agreement to 'hinder' in the sense, again, of delaying or impeding and hopefully preventing their arrest. The researches of counsel did not produce any authority stating or approving such a wide use of 'hinder'. If correct, it would mean, for example, that an offender in Sydney who heard that a warrant for his arrest had been issued in Perth and left his place of residence to hide from the police would be guilty of an offence where the effective changing of his address was, in fact, to delay, impede or prevent it. (I mention that – as appears from the trial judge's directions extracted below – the Crown case at trial was not merely that the occupants of the car agreed to evade the officer, but that they had agreed to avoid arrest. There was no evidence, as stated above, that the officer was intending to arrest anyone when he was killed.) In Leonard v Morris ... Bray CJ ... described the actus reus of the offence established by section 546C as 'any active interference or obstruction which makes the duty of the police officer substantially more difficult of performance'. This passage was adopted as correct by Sully J in Worsley v Aitken & Anor ... Worsley, it was alleged, took hold of the police officer's jacket when the officer was endeavouring to assist another officer then in the course of arresting another person during a melee, saying to the officer 'leave him alone, he's done nothing'. The officer desisted from his attempt to assist with the arrest of the suspect and pushed Worsley away before returning to his task. Of course, Sully J was there considering an actual physical interference by the accused person with the arrest which the officer was about to effect. That is not the use of hinder upon which the Crown relies in this case. The description of the actus reus of this offence given by Bray CJ in Leonard v Morris has been regarded, in my experience, as applicable in this State for decades and I would not be prepared to extend the offence any further by a wider use of the word 'hinder' than that which it has hitherto been understood to have. I am of the view that the actus reus of the offence created by s 546C is indeed that ascribed to it by Bray CJ in Callinan Leonard v Morris. It follows that the foundational offence upon which the Crown relied did not exist. In the circumstances, this conclusion is fatal to the correctness of the conviction. It is important, I think, to point out that it was not – at least, ultimately, for good reason I think – the Crown case that the [respondent] had a common purpose with Penisini to use a gun to threaten or attack Senior Constable McEnallay in order to evade or avoid arrest. There was simply no evidentiary basis for such a case, as the prosecutor at trial conceded. The highest point at which the Crown could aim was that the [respondent] foresaw the possibility that Penisini might use his weapon against the officer (though, on my view, this must be mere speculation). There was no evidence that could justify the conclusion that the [respondent] agreed with Penisini that he should use the gun to threaten, let alone shoot at the police officer or that he encouraged him to do so." On the question whether there should be an order for a new trial, Adams J said: "I propose that the conviction be quashed. In my view, there is no evidentiary basis for a conclusion that the [respondent] was party to an agreement that all four men would attempt to evade the police officer, as distinct from having made a decision that he would attempt to do so and knew that the others would do the same. Nor was there a basis for concluding that he adverted to the possibility that one of the others might use a gun in the course of evading the officer. The case proposed in this Court by the Crown, namely that there was an agreement to hinder the officer in the execution of his duty, was not put at trial and this Court should not order a new trial to permit such a different case to be put: R v Chekeri ... More fundamentally, the hindering identified – the running away – is not hindering within the meaning of s 546C of the Act. There is thus no foundational offence or joint criminal enterprise upon which the Crown can rely for the purpose of establishing the culpability of the [respondent] for the (conceded) unintentional consequence of shooting the police officer. As the [respondent] could not be convicted of murder or manslaughter on the cases as formulated by the Crown both at trial and in this Court, it seems to me that it is not appropriate to order a new trial." By the conclusion of argument in the Court of Criminal Appeal, the prosecution, at various stages of the proceedings, had identified the joint criminal enterprise, participation in which resulted in the respondent's complicity in the crime of murder, in three different ways. First, the joint enterprise (or common criminal design) was said to be using a firearm to avoid arrest and detention. That would have involved an agreement that a firearm would be used to avoid arrest. This was abandoned during the trial. Secondly, as the case was left to the jury, the joint enterprise was said to be to evade lawful apprehension. Thirdly, in Callinan the Court of Criminal Appeal, the joint enterprise was said to be hindering or resisting a police officer in the execution of his duty. It was suggested in argument in this Court that the Court of Criminal Appeal misapplied legal principle by requiring for extended common purpose in a murder case, not merely an agreement to commit what was called the foundational offence, but also an agreement to the act causing the death of the victim. No such error appears from the reasons of Adams J. His reasoning, as would be expected, responded to the case as put to the Court of Criminal Appeal. He merely pointed out, with justification, that, for the attempted evasion of apprehension which was said to constitute the joint criminal enterprise which was the "foundational offence", there had to be an agreement (in the sense explained in McAuliffe) and not merely four men all attempting to get away from the police officer. Adams J did not suggest that, on the case as finally put by the prosecution, it would have been necessary to show, in addition to a "foundational" joint criminal enterprise, an agreement to the shooting. The applicant's primary submission is that there should be a new trial so as to enable the prosecution to put, and a jury to consider, a case that this was "an armed robbery gone awry". On such a case, which was not put at trial or in the Court of Criminal Appeal, the relevant joint criminal enterprise, to which the respondent was a party, was armed robbery, and the respondent's secondary liability for the murder of Senior Constable McEnallay arose from his continuing participation in that enterprise with the foresight of the possibility that another person might be assaulted with intention to kill or cause really serious injury to that person. If that had been the prosecution case at the trial before Sully J, the course of the trial would almost certainly have been different. The question of the admissibility of the evidence that the respondent and the other men in the Holden were all men with criminal convictions who were on parole at the time of their observation by Senior Constable McEnallay would have taken on a different complexion. It was obviously to the advantage of the prosecution to have that evidence, but the basis upon which Sully J decided to admit the evidence would not apply. Secondly, the conduct of the defence case would probably have been different. It is hardly likely that the defence would have called Manuel Cackau as a witness. Thirdly, the relationship between the "foundational crime" and the allegedly foreseen shooting of a third party would have borne a different aspect. Where a case of murder is based upon the form of culpability described as "extended common purpose", the identification of the joint criminal enterprise, participation in which results in the accused's secondary liability, is an important particular of the case which the accused must meet. That is not to say that the prosecution must be able to identify the joint criminal enterprise with complete specificity. However, the judge and the jury must know enough about the Callinan enterprise to enable a decision to be made, first, as to whether it is criminal, and, secondly, as to whether the shooting was within the scope of the common purpose reflected in that joint criminal enterprise in that it was foreseen as a possible incident of the enterprise as explained in cases such as McAuliffe and Clayton. The judge must know enough about the enterprise to rule on questions of admissibility of evidence. Counsel for the accused must know enough about the enterprise to decide how to conduct the defence case. That is why, in the proceedings before Sully J, so much attention was devoted, before and during the trial, to the formulation of this aspect of the prosecution case. The function of particulars in criminal proceedings was explained in Johnson v Miller7, Giorgianni v The Queen8, and Stanton v Abernathy9. If to do so is not inconsistent with the interests of justice, particulars may be amended during the course of a criminal trial, as they were in the present case. The joint criminal enterprise that was left to the jury for consideration at the end of the trial was different from that opened by the prosecution. The joint criminal enterprise put in argument in the Court of Criminal Appeal was different again. As has been explained, by the end of argument in the Court of Criminal Appeal, the prosecution at various stages of the proceedings had particularised the "foundational crime" said to be the source of the respondent's secondary liability for murder in three different ways. Yet those three different particulars had one thing in common: the focus of attention was the conduct of the four men in the Holden during the very brief time between their first observation of Senior Constable McEnallay and the shooting of Senior Constable McEnallay by Sione Penisini, and their desire to evade apprehension by him. It was this that made admissible the evidence that they were all on parole at the time. That was said to be the motive for their joint plan to avoid apprehension, and the existence of that alleged joint plan was what was said to produce the consequence that, when one of the men, in the course of attempting to avoid apprehension, shot and killed the police officer, they were all guilty of homicide. The application for special leave to appeal In R v Benz10, this Court discussed the considerations relevant to the exercise of its power to grant special leave to appeal from a decision of a Court of Criminal Appeal which has quashed a conviction and entered a verdict of (1937) 59 CLR 467 at 489. (1985) 156 CLR 473 at 497. (1990) 19 NSWLR 656. 10 (1989) 168 CLR 110. Callinan acquittal. An example of the exercise of that power is R v Rogerson11. As Mason CJ explained in Benz12, while there is a reluctance to grant special leave to appeal against an acquittal by an intermediate appellate court, sometimes expressed by reference to the need to show "very exceptional circumstances"13, the considerations of double jeopardy that would apply to an attempt to appeal from a verdict of acquittal by a jury are not the same as those that apply when a convicted person has initiated the appellate process, which includes the possibility of a decision by a final court of appeal. If an intermediate court of appeal, whose jurisdiction has been invoked by a convicted person, makes an error in that person's favour, the possibility remains of correction of that error within the appellate process itself. This will be of special importance if the error is of such a kind as is likely to affect the general administration of the criminal law, as in the case of an erroneous decision on a point of law or procedure of general application. It may also be of significance where correction of error is necessary to ensure the due administration of justice in the individual case14. It is, however, unnecessary to pursue the question of the kind of error by a Court of Criminal Appeal that will justify intervention by this Court even in the case of an acquittal. It is unnecessary because, in this case, the Court of Criminal Appeal made no error. Its reasons for decision, which were addressed to the arguments that were put to it, were correct. The applicant for special leave to appeal to this Court contends that the order of the Court of Criminal Appeal, by entering an acquittal and failing to order a new trial, was wrong, not because of any error in the reasoning of the Court of Criminal Appeal on the arguments put to it, but because, for a reason not advanced to or considered by the Court of Criminal Appeal, there should have been an order for a new trial. In brief, the purpose of the application for special leave to appeal is to have this Court, in the exercise of its appellate jurisdiction, vary the orders made by the Court of Criminal Appeal in allowing the appeal to that Court, and order that there be a new trial for a reason not previously argued. In Eastman v The Queen15 this Court rejected the idea that a court exercising criminal appellate jurisdiction has an obligation, of its own motion, to examine the material before it in search of any possible miscarriage of justice, regardless of the way in which the case has been put to it. In the present case, the 11 (1992) 174 CLR 268. 12 (1989) 168 CLR 110 at 111-113. 13 R v Lee (1950) 82 CLR 133 at 138. 14 R v Benz (1989) 168 CLR 110 at 113-114. 15 (2000) 203 CLR 1. Callinan Court of Criminal Appeal was not obliged, of its own motion, to consider whether there might have been a way of putting the case against the present respondent, even though not advanced at trial or before the Court of Criminal Appeal, which, if accepted by a jury, would have warranted his conviction for culpable homicide, whether murder or manslaughter. The failure of the Court of Criminal Appeal to undertake such a course was not an error, and does not constitute a precedent that, in the general interests of the administration of justice, requires correction. Let it be supposed, however, contrary to the fact, that, at some stage before final orders had been made by the Court of Criminal Appeal, the present applicant had approached that Court to have the matter listed for further argument, and had submitted that, if the appeal were allowed, there should be an order for a new trial in order to enable the prosecution to put against the accused a case of culpable homicide, based on extended common purpose, in which the relevant joint criminal enterprise was an armed robbery. Unless it can be shown that the Court of Criminal Appeal's proper response to such an application would have been to hear the argument, agree with it, and order a new trial then the present application to this Court must fail. Even if that could be shown, there would be a further question relating to the limitations on the circumstances in which this Court will allow an appeal on a ground not taken at trial or in an intermediate appellate court16. If, however, that could not be shown, it would be unnecessary to examine that further question. If an application of the kind supposed had been made to the Court of Criminal Appeal, that Court would have had to consider the nature of its power, upon allowing an appeal, to order a new trial. The source of that power is s 8(1) of the Criminal Appeal Act 1912 (NSW) which provides that on an appeal against conviction on indictment, the court may, either of its own motion, or on the application of the appellant, order a new trial in such manner as it thinks fit, if the court considers that a miscarriage of justice has occurred, and, that having regard to all the circumstances, such miscarriage of justice can be more adequately remedied by an order for a new trial than by any other order which the court is empowered to make. As Dawson J pointed out in King v The Queen17, that section confers a broad discretion, and the discretion is to be exercised in accordance with settled principles. Dawson J said18: 16 See, for example, Crampton v The Queen (2000) 206 CLR 161. 17 (1986) 161 CLR 423 at 433. 18 (1986) 161 CLR 423 at 433. Callinan "It is well established that the discretion to order a new trial should not be exercised when the evidence in the court below was not sufficiently cogent to justify a conviction or to allow the Crown to supplement a case which has proved to be defective. In particular, the Crown should not be given an opportunity to make a new case which was not made at the first trial." In support of the proposition in the second sentence of that paragraph, Dawson J referred to what was said by Dixon J in R v Wilkes19. What, in the context, is meant by "a new case"? Plainly, it does not mean a different charge. Subject to certain rules of preclusion, or to considerations of oppression, if the prosecuting authorities fail to establish that an accused person committed one offence they may later charge him or her with another offence. In such circumstances, there is no new trial in other than a colloquial sense. There is a further and different trial. In the context of a new trial for the same offence, the reference to a "new case" must be to the particulars of the charge, and to the nature of the evidence that will be adduced in support of it, not to the elements of the offence. It may be asked why "the Crown should not be given an opportunity to make a new case which was not made at the first trial". If the prosecuting authorities at trial fail to satisfy the jury of their case, as particularised, then that is the end of the matter. As a general rule, the jury's acquittal prevents a further attempt to prove the same offence. The prosecution cannot bring the same charge again, relying on new evidence, or new arguments. If, however, there is a conviction at trial, but the conviction is quashed on appeal, and there is an evidentiary basis for a possible "new case", can the Court of Criminal Appeal order that the prosecution may attempt, at a new trial, to make out a new case? The considerations identified in Crampton v The Queen20 as reasons for the rule confining the circumstances in which a new point may be taken in this Court on a criminal appeal by an accused person are relevant in this context also. In particular, the adversarial procedure of criminal justice, which is bound up with notions of judicial independence and impartiality, and according to which the issues at trial are chosen and defined by the parties and their counsel, is at the heart of the matter. It is the executive branch of government that decides whether to prosecute, and what charges to lay. A trial is fought as a contest between the executive government and a citizen. The judge presides neutrally over that contest. Counsel for the respective parties define the issues, decide what witnesses will be called and what questions will be asked, and decide what 19 (1948) 77 CLR 511 at 518. 20 (2000) 206 CLR 161 at 172-173 [15]-[20]. Callinan arguments will be pursued and what will be abandoned. The general rule that litigants are bound by the conduct of their counsel, a rule essential to the adversarial system, applies with at least as much force to the prosecution as to the defence. The decision by trial counsel for the prosecution in the present case concerning the identification of the relevant joint criminal enterprise was a considered decision, with plain tactical implications. They included the admissibility of the evidence that the four men in the car were all on parole, and the ease or difficulty of proof of the alleged enterprise. The case which the applicant now seeks an opportunity to make at a new trial is a new case within the principles earlier stated. It is a case based on a radically different particularisation of the joint criminal enterprise fundamental to the respondent's alleged secondary liability for the killing of Senior Constable McEnallay. The Court of Criminal Appeal should have refused an order for a new trial on that basis, if an attempt had been made to raise the argument. That being so, the present application to this Court should fail. Two further matters may be noted. First, it is far from clear that the case which the prosecution now seeks to put, and which was not put at trial, is of substantial plausibility. It is one thing to say that the four men in the Holden were up to no good and that it looks as though they were equipped for crime, probably an armed robbery. It does not follow that the evidence justifies a conclusion, beyond reasonable doubt, that at the time Senior Constable McEnallay came upon them they had embarked upon such a criminal enterprise. That may help to explain why this new way of putting the prosecution case was discarded in the first place. It is consistent with Sully J's original reaction to the case. We do not know, and cannot know, why the "armed robbery gone awry" theory did not appeal to counsel for the prosecution at trial. We do not know what was in counsel's brief. However, from such as we know, his decision not to follow that line of argument was understandable. This leads to the second matter. Suppose the respondent's appeal to the Court of Criminal Appeal had failed. Suppose his conviction of murder had been upheld, and he had sought special leave to appeal to this Court. Suppose he attempted to advance an argument that had not been put by his counsel at trial or in the Court of Criminal Appeal. He would have had to show exceptional circumstances to be allowed to put the argument. If it appeared that the argument had not been put in the courts below for a tactical reason, his prospects of being allowed to raise it in this Court for the first time would have been negligible. It would be anomalous if the prosecution were in a different position. The adversarial system has its advantages, and disadvantages, but it should work in a fashion that is even- handed. Callinan Conclusion Special leave to appeal should be refused. Crennan GUMMOW, HAYNE, HEYDON AND CRENNAN JJ. The background The procedural background. The relevant background can be stated briefly. Motekiai Taufahema ("the accused") was convicted by a jury after a trial in the Supreme Court of New South Wales of murdering Senior Constable Glenn McEnallay. He was also convicted of unlawful possession of a Smith and Wesson .357 revolver. The Court of Criminal Appeal allowed an appeal against the murder conviction, and ordered an acquittal rather than a new trial. The prosecution seeks special leave to appeal against that order. The factual background. There was evidence before the jury capable of supporting the following factual conclusions. Senior Constable McEnallay died seven days after being shot by Sione Penisini. Penisini was one of four men in a car which had been observed driving at excessive speed and erratically in other ways. Earlier in the day Penisini had telephoned the accused and his brother, John Taufahema. The latter two then travelled by train from Punchbowl to Blacktown. At Blacktown Station they met Meli Lagi. The three men went by taxi to Penisini's house, picked him up, and collected a car from a friend of Penisini. All four men were on parole. The car had been reported to the police as having been stolen. Although the accused was not licensed to drive, he drove the car to his house. He then drove the car until it came under the observation of Senior Constable McEnallay, who had been alerted by other police officers to the fact that the car had been seen being driven erratically on the way to the accused's house. The following events then took place in no more than a minute before Senior Constable McEnallay was shot. The car containing the four men was pursued by and fled from Senior Constable McEnallay, struck a gutter, and stopped. Senior Constable McEnallay summoned aid. The four men leaped from the car. Penisini fired five shots into the windscreen of the police car, four of which hit Senior Constable McEnallay, and one of which caused head wounds from the effects of which he later died. The four men, each carrying a loaded gun, which had been stolen two weeks earlier, ran away, but were pursued by police officers who had responded to Senior Constable McEnallay's call for aid. Penisini and John Taufahema were soon arrested after attempting to "car-jack" a passing vehicle. The accused was also soon arrested after being seen hiding the gun he was carrying behind some flowerpots in a garden (a matter about which he later lied to the police). The fact that the accused was in possession of the gun is no longer in dispute; his conviction on that charge was not in issue. Lagi was arrested some days later. Crennan The police found in the car a hockey mask and a pair of gloves, and when they apprehended Penisini and John Taufahema they found nearby a second pair of gloves, a pair of sunglasses and a pouch of ammunition. They also found loose bullets near the car driven by the accused. A primary claim which the accused made in an interview with the police and in his evidence at the trial was that he had no knowledge that there were any loaded firearms or other incriminating items in the car, and that he only came to possess a gun when Penisini threw him one after firing the shots. He also called a witness, Manuel Cackau, whose evidence, on the accused's argument, tended to suggest that while Cackau and the other three men planned to travel to Melbourne in order to commit robberies, the accused was not party to that agreement. The prosecution case at the trial. The prosecution put its case in two ways at the trial. It opened the case to the jury by saying that the accused was party to a joint criminal enterprise, namely one involving the use of a firearm to prevent the lawful arrest of the men in the car by the police. But the prosecution case by the end of the trial as put by prosecution counsel to the jury and as explained in the trial judge's summing up was that there was a joint enterprise to evade arrest, involving the shooting of a police officer as a foreseen possibility. Ground 2.4 Ground 2.4 of the applicant's draft Notice of Appeal was: "The Court of Criminal Appeal erred in refusing to order a re-trial and entering a verdict of acquittal in the circumstances of the present case." The Court of Criminal Appeal's conclusions. The key elements of the position arrived at by the end of the Court of Criminal Appeal's judgment were as follows. It was necessary to allow the accused's appeal to the Court of Criminal Appeal because the directions of the trial judge were erroneous in relation to the foresight necessary if the accused were to be convicted of murder. In substance, counsel for the prosecution conceded that in the Court of 21 Taufahema v The Queen (2006) 162 A Crim R 152 at 165 [38]. Crennan It was also necessary to allow the appeal for another reason. The prosecution case was left to the jury as depending on an agreement to commit a particular "foundational crime" in the course of which another crime had been committed which had been within the contemplation of the accused22. The difficulty identified by the Court of Criminal Appeal was that while the "foundational crime" relied on at the trial was a "crime of avoiding lawful arrest", that was in truth no crime23. A further difficulty arose out of an attempt to sidestep this difficulty by relying on an alternative candidate for the "foundational crime", advanced, according to the Court of Criminal Appeal, only in that Court24, namely hindering a police officer in the execution of his duty. The Court of Criminal Appeal concluded that the evidence was incapable of supporting the view that any agreement to commit that crime had been made25. In this Court the Director of Public Prosecutions did not quarrel with the Court of Criminal Appeal's reasoning in those respects. The Court of Criminal Appeal also found other flaws in the trial judge's directions: they did not sufficiently distinguish between separate decisions by each of the four men in the car to escape and an agreement between them to do so26. In this Court the Director of Public Prosecutions did not quarrel with the Court of Criminal Appeal's reasoning in these respects either. Since the summing up rested on a "wrong decision" of a "question of law" within the meaning of s 6(1) of the Criminal Appeal Act 1912 (NSW), and 22 Whether this part of the criminal law is usefully to be analysed by reference to "foundational crimes" is a matter which arose in argument. It did not form any part of the proposed grounds of appeal and in view of the brevity of the argument on the point, and the fact that it is not decisive of the outcome of this case, nothing more is said about it. But see Gillard v The Queen (2003) 219 CLR 1 at 39 [124] per 23 Taufahema v The Queen (2006) 162 A Crim R 152 at 160-161 [20]-[23] and 162 24 Taufahema v The Queen (2006) 162 A Crim R 152 at 161 [24]. 25 Taufahema v The Queen (2006) 162 A Crim R 152 at 161-162 [24]-[27]. 26 Taufahema v The Queen (2006) 162 A Crim R 152 at 163 [30]. Crennan since no question of the proviso to that sub-section being applied could arise, the Court of Criminal Appeal was obliged to allow the appeal27. Section 6(2) of the Criminal Appeal Act provides: "Subject to the special provisions of this Act, the court shall, if it allows an appeal under section 5(1) against conviction, quash the conviction and direct a judgment and verdict of acquittal to be entered." Among the "special provisions" is s 8(1) which provides: "On an appeal against a conviction on indictment, the court may, either of its own motion, or on the application of the appellant, order a new trial in such manner as it thinks fit, if the court considers that a miscarriage of justice has occurred, and, that having regard to all the circumstances, such miscarriage of justice can be more adequately remedied by an order for a new trial than by any other order which the court is empowered to make." Thus a final question was left – whether the Court of Criminal Appeal should order an acquittal or a new trial. To that question little attention was directed in argument before the Court of Criminal Appeal, and the ground on which the prosecution now says that a new trial should have been ordered, instead of the acquittal which the Court of Criminal Appeal actually ordered, was not raised with the Court of Criminal Appeal. The fundamental issue. One of the key "circumstances" referred to in s 8(1), and one of the key factors in assessing whether a new trial is an adequate 27 Section 6(1) provides: "The court on any appeal under section 5(1) against conviction shall allow the appeal if it is of opinion that the verdict of the jury should be set aside on the ground that it is unreasonable, or cannot be supported, having regard to the evidence, or that the judgment of the court of trial should be set aside on the ground of the wrong decision of any question of law, or that on any other ground whatsoever there was a miscarriage of justice, and in any other case shall dismiss the appeal; provided that the court may, notwithstanding that it is of opinion that the point or points raised by the appeal might be decided in favour of the appellant, dismiss the appeal if it considers that no substantial miscarriage of justice has actually occurred." Crennan remedy, is "the public interest in the due prosecution and conviction of offenders"28. It is in "the interest of the public ... that those persons who are guilty of serious crimes should be brought to justice and not escape it merely because of some technical blunder by the judge in the conduct of the trial or in his summing up to the jury."29 This passage highlights two points about the present case. First, there is no doubt that Senior Constable McEnallay was murdered; almost all murders are very serious crimes, and murders of police officers while carrying out their duties are no exception to that generalisation. Secondly, whether or not one chooses to call the errors identified by the Court of Criminal Appeal "blunders", they were certainly "technical", and they were errors by the trial judge rather than by the prosecution. For it was the trial judge rather than the prosecution who bore primary responsibility for the circumstances which led the Court of Criminal Appeal to allow the appeal30. Apart from the errors in summing up criticised by the Court of Criminal Appeal, it was by reason of the trial judge's influence, in a long debate with counsel for the prosecution after the evidence had closed but before final addresses, that the prosecution ended up not pressing its original case as opened to the jury, instead relying only on a case turning on a "foundational crime" of evading lawful apprehension which does not exist. The fact is that the trial which took place was a flawed one. The question is whether an order for a new trial is a more adequate remedy for the flaws in that trial than an order for an acquittal – that is, an order terminating the possibility of any investigation by a jury, in an unflawed fashion, of the accused's role in the circumstances leading to Senior Constable McEnallay's death. An order for acquittal conflicts with "the desirability, if possible, of having the guilt or innocence of the [accused] finally determined by a jury which, according to the constitutional arrangements applicable in [New South Wales], is the appropriate body to make such a decision."31 In Reid v The 28 R v Anderson (1991) 53 A Crim R 421 at 453 per Gleeson CJ. 29 Reid v The Queen [1980] AC 343 at 349 per Lords Diplock, Hailsham of St Marylebone, Salmon, Edmund-Davies and Keith of Kinkel. 30 cf R v Anderson (1991) 53 A Crim R 421 at 453 per Gleeson CJ (pointing to investigative failures by the authorities and "inappropriate and unfair" conduct by the prosecution at the trial). 31 R v Anderson (1991) 53 A Crim R 421 at 453 per Gleeson CJ. Crennan Queen32 the Privy Council approved the following statement of the Full Court of Hong Kong33: "It is in the interest of the public, the complainant, and the appellant himself that the question of guilt or otherwise be determined finally by the verdict of a Jury, and not left as something which must remain undecided by reason of a defect in legal machinery." The reference to "complainant" is to be explained by the fact that that case was one in which a doctor allegedly raped a patient. It is not only those who live to complain about crime whose interests are relevant, but also the relatives and friends of those who do not. The Full Court of Hong Kong described the case before it as one "of peculiar heinousness", and so is this case. The question, then, is whether there is some good reason for not allowing a jury to decide whether the prosecution can prove its case, and for allowing the matter to remain undecided because of the defects in the first trial. Insufficiency of evidence at one trial does not justify an order for a second trial. In Gerakiteys v The Queen34, Gibbs CJ, when considering what was a sound exercise of the power of a court of criminal appeal to order a new trial, said: "It would conflict with basic principle to order a new trial in a case in which the evidence at the original trial was insufficient to justify a conviction35." That proposition rests in part on the idea that if the evidence is unchanged at the second trial, accused persons should not be placed in jeopardy of conviction by a second jury where an appellate court has found that the evidence was insufficient 32 [1980] AC 343 at 350 per Lords Diplock, Hailsham of St Marylebone, Salmon, Edmund-Davies and Keith of Kinkel. 33 Ng Yuk Kin v The Crown (1955) 39 HKLR 49 at 60 per Gould, Gregg and 34 (1984) 153 CLR 317 at 321. See also at 322 per Murphy J, 331 per Deane J. 35 See Reid v The Queen [1980] AC 343 at 349-350 per Lords Diplock, Hailsham of St Marylebone, Salmon, Edmund-Davies and Keith of Kinkel; and see also R v Wilkes (1948) 77 CLR 511 at 518 per Dixon J and Andrews v The Queen (1968) 126 CLR 198 at 211 per Barwick CJ, McTiernan, Taylor, Windeyer and Owen JJ. Crennan at the first trial; and in part on the idea that a new trial should not be ordered merely to give the prosecution an opportunity of mending its hand and presenting new evidence at the second trial which it failed to present at the first36. That proposition does not apply in relation to either of the ways in which the prosecution case was put at this trial. That is partly because the prosecution does not propose to rely on any of these ways at the second trial which it is seeking. It is partly because the appeal did not succeed by reason of evidentiary insufficiency, but by reason of the fact that the foundational crime relied on was not a crime, and by reason of deficiencies in the summing up. The accused's notice of appeal in the Court of Criminal Appeal did not contend that the jury's verdict was unreasonable or could not be supported having regard to the evidence. The case to be advanced at the second trial. The question whether there should have been an order for a new trial must be approached in the light of the way in which the prosecution wishes to conduct the second trial. It desires to contend that the accused and the other three men in the car were engaged in a joint criminal enterprise of armed robbery, and that shooting another person was foreseen as a possible incident of that enterprise. The issue is whether, had the Court of Criminal Appeal been informed of that desire, it ought to have ordered a new trial. That the prosecution should have raised this point for the first time in this Court is regrettable, but there is no absolute bar to accused persons doing this37, and there can be no absolute bar to the prosecution doing so as well. Immaterial factors. Among the factors which conventionally point against orders for new trials are some which were not relied on and do not arise here. One is whether a significant part of a sentence has been served38: here only a relatively small part of a very long sentence of 23 years imprisonment with a 16 year non-parole period has been served. Another is the expense and length of a second trial39: here the first trial took 15 days, but this was not disproportionate to its importance. Another is the length of time between the alleged offence and 36 Reid v The Queen [1980] AC 343 at 349-350 per Lords Diplock, Hailsham of St Marylebone, Salmon, Edmund-Davies and Keith of Kinkel. 37 Crampton v The Queen (2000) 206 CLR 161. 38 Jiminez v The Queen (1992) 173 CLR 572 at 590 per McHugh J. 39 Reid v The Queen [1980] AC 343 at 350. Crennan the new trial40: here it is not so great as to prejudice the accused. Another is whether a successful appellant to the Court of Criminal Appeal has been released from custody41: here the accused remained in custody after the Court of Criminal Appeal's order for acquittal, serving his sentence on the conviction for unlawful possession of a firearm. Other factors are relevant, but it is not said that they are here decisive, for example the fact that a trial is an ordeal for accused persons (and, it may be added, for witnesses and others affected by the prosecution and the events giving rise to it). Whether accused persons should have to undergo that ordeal for a second time, through no fault of their own, depends upon whether the interests of justice require it42. It is desirable to concentrate on the grounds said to justify the refusal of special leave to appeal. They are five in number. They may be analysed under the heads of prosecution tactics, departure from well-considered earlier tactics, no opportunity to make a new case, an implausible case and parity of treatment for prosecution and defence. Prosecution tactics. Counsel for the accused relied heavily on the contention that it was in effect oppressive for the prosecution, having failed to achieve success in the way it ran the first trial, to try to achieve success in a second trial, particularly since the point on which it seeks to have a second trial was not raised before its special leave application to this Court. If that contention were sound, the prosecution could never raise a fresh point in this Court, and there could never be an appeal in this Court against an order of acquittal made by a court of criminal appeal. Yet the prosecution can raise fresh points in this Court, just as accused persons can, and there can be successful appeals in this Court against orders of acquittal made by intermediate courts of appeal, unusual though they may be. At other points of his argument, counsel for the accused did correctly concede that the Court of Criminal Appeal had discretionary power to order a new trial in the present circumstances, however difficult the decision 40 Parker v The Queen (1997) 186 CLR 494 at 520 per Dawson, Toohey and McHugh JJ. See also R v Anderson (1991) 53 A Crim R 421 at 453 per Gleeson CJ; Reid v The Queen [1980] AC 343 at 350 per Lords Diplock, Hailsham of St Marylebone, Salmon, Edmund-Davies and Keith of Kinkel. 41 Everett v The Queen (1994) 181 CLR 295 at 302 per Brennan, Deane, Dawson and Gaudron JJ quoted discussion of a similar point in R v Wilton (1981) 28 SASR 362 at 367-368 per King CJ. 42 Reid v The Queen [1980] AC 343 at 350. Crennan whether to do so or not. It follows that since the Court of Criminal Appeal was not asked to exercise its discretion on the basis now relied on, this Court may examine what that Court should have done if it had been asked to exercise it on that basis. That makes it necessary to examine whether the particular circumstances render it wrong to grant this particular special leave application and allow the appeal. Departure from well-considered earlier tactics. A related submission turned on the proposition that it is common for appellate courts to conclude that no miscarriage of justice arises where an error of the trial judge is not complained of by counsel appearing for the accused in a criminal trial, or counsel otherwise conducts the trial in a particular way. However, it does not follow that counsel for the prosecution is debarred from requesting a new trial to be conducted on a different basis from an earlier trial in which a conviction was obtained and then set aside on appeal, merely because the basis on which the earlier trial was conducted appears to have been a carefully considered one. That may be a relevant factor, but it is to be taken into account with all other relevant factors, one of which is how different the new basis is from the old, and in what ways. No opportunity to make a new case. A third ground said to justify the refusal of special leave to appeal was also pressed strongly by counsel for the accused. It relies on Dawson J's statement in King v The Queen43, which the prosecution did not dispute, that "the Crown should not be given an opportunity to make a new case which was not made at the first trial". It reasons that a "new case" is to be assessed by reference to the particulars of the charge, and to the nature of the evidence that will be adduced in support of it. The reasoning draws an analogy with the restrictions on an accused person taking a new point in a criminal appeal. It states that the decision of counsel for the prosecution at the trial to identify the joint criminal enterprise as he did was a considered decision, with plain tactical implications, two of which were the admissibility of the evidence that the four men in the car were all on parole, and the ease or difficulty of proof of the alleged enterprise. The case intended for the second trial is a "new case" because it is a case based on a radically different particularisation of the joint criminal enterprise. The authorities on whether appellate courts should order a new trial or an acquittal offer very little explicit exposition of what is meant, conceptually, by a "new case which was not made at the first trial". However, the way the authorities have been decided tends to show that the "new case" test is not easy 43 (1986) 161 CLR 423 at 433. Crennan for accused persons to satisfy. It is proposed to examine four of those authorities. The authorities commonly cite44 Dixon J's judgment in R v Wilkes45. R v Wilkes was a case in which a man and his wife were charged with three offences: the manslaughter of one Mrs Boulton; conspiracy with Boulton and one Mr Prior to procure the unlawful miscarriage of Boulton; and conspiracy with Prior to defeat the course of public justice. Prior was given a pardon, and was the main prosecution witness. Dixon J said that the prosecution "presented a case ... depending upon the view that the prisoners and [Prior] had been engaged in a series of steps directed to procuring the abortion of a pregnant woman, and that in the attempt to procure the abortion they, or one or more of them, had killed her and then had attempted to conceal their crime by telling a lying story accounting for the body."46 Below that "case" will be called "the initial case". The jury acquitted on the first two counts but convicted on the third. The Court of Criminal Appeal of South Australia allowed an appeal in the following words47: "In the light of the seeming inconsistency of the verdicts, the absence of corroboration of Prior, and the criticisms we have made of the learned judge's directions, we cannot feel satisfied that the verdicts have been reached upon proper grounds. We do not think that this is a case in which we should order a new trial. There was, of course, evidence upon which a jury properly directed could have found the appellants guilty on the third count, and in ordinary circumstances it would have been proper to order a new trial. The present case is, however, complicated by the verdict on the first and second counts. We have no power to set aside a judgment of acquittal following a verdict of not guilty, and, consequently, we cannot order a new trial on all three counts. If we had the power we would do so ... On a new trial confined to the third count, Prior's story will have to be told again at length, in order to make it intelligible. In directing the jury afresh, the presiding judge must warn the jury against the danger of acting 44 Thus Dawson J did so in King v The Queen (1986) 161 CLR 423 at 433, McHugh J did so in Jiminez v The Queen (1992) 173 CLR 572 at 590, and Kirby J did so in Parker v The Queen (1997) 186 CLR 494 at 539. 45 (1948) 77 CLR 511 at 518. 46 R v Wilkes (1948) 77 CLR 511 at 517. 47 R v Wilkes (1948) 77 CLR 511 at 513-514. Crennan on his evidence. It will also be necessary[48] to tell them that, as between the Crown and the accused, it has been conclusively established that they did not kill Mrs Boulton and, further, that they did not conspire with Prior and Mrs Boulton to procure her miscarriage. With these directions, doubt will immediately arise as to Prior's story, and the judge is likely to feel that he ought to advise the jury not to convict." "On the case made for the Crown it was difficult for the jury to convict on the third count consistently with their acquittal on the first two counts. Logical possibilities have been suggested as to the manner in which the jury might have arrived at the result. It is suggested that they might have failed to believe substantial parts of the story to which the accomplice deposed and have combined the rest with part of the account given by the accused, which they may have been inclined to accept. The suggestion is that in some such way the jury may have supposed that the attempted abortion which caused the deceased's death was carried out, not by the accused, but by an unnamed and unknown person who would be a fifth actor in the drama." "It must be conceded of course that, as logical possibilities, such hypotheses are conceivable. But the case made for the Crown did not contemplate any such supposition, and it would in my opinion be entirely unsatisfactory to leave a verdict of guilty on the third count standing on the assumption that the jury took such a view. It is a view which is contrary to all the probabilities ... and it is contrary to the substance of the case presented to them by the learned judge in his summing up, and, as I have no doubt, by the Crown. To set aside a verdict of such a description is an ordinary example of the proper use of the power conferred upon the Court of Criminal Appeal. It is an exercise of the discretion of the court from whose order we ought not to grant special leave to appeal." 48 Dixon J questioned whether it would be necessary to tell the jury these things, while accepting their correctness: R v Wilkes (1948) 77 CLR 511 at 518. 49 R v Wilkes (1948) 77 CLR 511 at 517. 50 R v Wilkes (1948) 77 CLR 511 at 517-518. Crennan In this passage Dixon J was making it plain that he saw the conclusion of the court below as defensible by reason of inconsistency in the verdicts. To allow an appeal on that ground is to set aside the jury verdict as unreasonable; it is to say that, accepting the acquittals on the first two counts, and the jury's view of the evidence as reflected in the acquittals, as correct, the remaining evidence was insufficient to justify a conviction on the third count. That is an application of the proposition referred to above, that where a criminal appeal succeeds on the ground that the evidence at the trial is insufficient to justify a conviction, it is against principle to order a new trial. That point was made by Dixon J when he turned specifically to the new trial issue51: "After quashing the conviction, the Supreme Court went on to say that they would not order a new trial, and their Honours gave a number of reasons why they would not order a new trial. Again, I think that it was for them to decide in the exercise of their discretion whether they would or would not order a new trial. I myself most certainly would have come to the same conclusion, namely, that in the circumstances a new trial should not be granted. I would have done so because it would necessitate the presentation by the Crown either of the case on which the accused had substantially been acquitted or of a new case which had not been made at the first trial, a case moreover which, I should have thought, was highly improbable and a desertion of the assumptions which the jury's previous verdict seems to require." By "the case on which the accused had substantially been acquitted" Dixon J meant what was called above "the initial case". By the "new case" Dixon J meant the "logical possibilities" involving a "fifth actor in the drama" as the person responsible for the attempted abortion. So viewed, R v Wilkes is remote from the present circumstances. There is here no inconsistency of verdicts. The accused here has not been acquitted by a jury, substantially or at all, in relation to any charge. Neither the jury nor the Court of Criminal Appeal has made any factual finding in favour of the accused; the Court of Criminal Appeal has merely found errors in the summing up and legal errors about the foundational crime. And the "new case" here is not one which depends on merely "logical possibilities" or "conceivable hypotheses" which postulate some new crime committed by a "fifth actor". It cannot be said that the "new case" here is either highly improbable or one which deserts the assumptions which the jury's verdict requires. 51 R v Wilkes (1948) 77 CLR 511 at 518. Crennan A second case discussing the principle that the Crown should not be given an opportunity to make a new case which was not made at the first trial is King v The Queen52. In that case Dawson J (Gibbs CJ, Wilson and Brennan JJ concurring) stated that principle and said it would have applied in circumstances similar to those discussed by Dixon J in R v Wilkes involving inconsistent verdicts53. In King v The Queen, King and Matthews were charged with murdering King's wife. King was convicted but Matthews was acquitted. The Court of Criminal Appeal of New South Wales directed a new trial. King sought special leave to appeal on the ground that an acquittal should have been ordered. "If the verdict against King in this case was inconsistent with the verdict in favour of Matthews, then the Crown could properly succeed against King upon a retrial only by putting a new case. It certainly ought not be allowed to proceed in any retrial upon a basis inconsistent with the jury's verdict of acquittal of Matthews." However, he concluded that the two verdicts given by the jury were not inconsistent, and the new trial order stood. There is no difficulty arising from inconsistency of verdicts in the present application for special leave to appeal. Jiminez v The Queen55 is a third example of a case discussing this principle, with it being decided not to order a new trial because, to use the words of the only judge who relied on this point, McHugh J, "a second trial would allow the Crown to make a case different from that which it put to the jury at the first trial."56 That was a case in which the prosecution contended at the trial that the accused could be convicted of causing death by driving in a manner dangerous to the public by reason of having gone to sleep. On appeal the prosecution conceded that that approach was erroneous in law. McHugh J concluded57: 52 (1986) 161 CLR 423. 53 (1986) 161 CLR 423 at 433. 54 (1986) 161 CLR 423 at 433. 55 (1992) 173 CLR 572. 56 (1992) 173 CLR 572 at 590. 57 (1992) 173 CLR 572 at 589. Crennan "Having regard to the concession which the Crown made in this Court, the only case which the Crown could put against the applicant was that he was guilty of driving in a manner dangerous to the public because he knew or ought to have known that there was a real risk that he would fall asleep. But that case was never put to the jury." He then said58: "[T]he case for the Crown at the trial was so radically different from the only case which could be put on the concessions of the Crown in this Court that there has been no trial according to law." The latter case was a "new case". Thus the initial case in Jiminez v The Queen turned on events after going to sleep, the other on events before. The two cases dealt with events different in time, place and quality. Plainly the difference between the two "cases" under consideration in Jiminez v The Queen is of a quite different kind from the two "cases" in the present application for special leave to appeal. Finally, in Parker v The Queen59 Dawson, Toohey and McHugh JJ refused to order a new trial to enable the prosecution to present a fresh case which would require "a substantial amendment to the indictment", including a change in the persons from whom the property allegedly was stolen. Here no amendment to the indictment is called for. These authorities suggest that the difference between the case relied on in a first trial and the case to be relied on in a second trial must be substantial if the difference is to stand as a bar to an order for a second trial. In the present case, what the prosecution proposes to do at the second trial of the accused is not to advance any factual allegation inconsistent with what the jury or the Court of Criminal Appeal have already found, and not to advance any factual allegation inconsistent with the case advanced at the first trial. It proposes to tender the circumstantial evidence tendered at the first trial – of the telephone calls made by the four men on the day in question, of the surveillance of two of the men as they travelled by railway, of their movements around Sydney, and of the incriminating materials they possessed (four loaded guns, all stolen; extra ammunition; a hockey mask; two pairs of gloves; sunglasses). That 58 (1992) 173 CLR 572 at 590. 59 (1997) 186 CLR 494 at 520. Crennan evidence illuminates the nature of the enterprise on which the men were engaged. The enterprise can be characterised in different ways. That is, what the prosecution proposes to do is rely on the same evidence as was called at the first trial, but to seek to characterise the facts which that evidence may establish in a different way, but not a radically different way. At the first trial the criminal enterprise revealed by the evidence was not called "armed robbery", but the evidence was capable of supporting the inference that it was. Indeed, the defence embraced that inference in calling Cackau to say that the three men other than the accused were engaged in an enterprise of armed robbery. All the prosecution proposes to do at the second trial is to rely on an inference which could have been drawn in the first trial. The evidence that the four men were on parole, which was held relevant at the first trial as showing that the accused had a strong motive to adhere to a joint enterprise of avoiding apprehension by the police, will not necessarily be held irrelevant at the second trial. It may be relevant at that trial as going to the possibility of a firearm being used, for the consequences of apprehension for persons engaged in the joint enterprise of robbery are likely to be seen by them as worse if they were on parole. It has not been shown that the evidence to be called by the prosecution at the second trial will be different in any other respect. Counsel for the accused conceded that if the characterisation which the prosecution wishes to make of the evidence at the second trial had been put at the first, there would have been no difference in the evidence called, except for Cackau. In fact it has not been shown that the accused would not have called Cackau had the "new case" been presented at the first trial, since the point of doing so was to seek to establish that the accused was not part of the criminal enterprise. That goal was as important as it will be in the second trial, and the only way of achieving it was to call Cackau. As for tactical considerations, no doubt it was easier for the prosecution to seek to establish the case left to the jury than the case opened at the first trial at a factual level, and possibly the "new case", had it occurred to counsel for the prosecution, was originally not run because of its perceived difficulty. In the circumstances as they have unfolded, however, it is hard to see why it is unfair for the prosecution to be allowed to remould its case in the manner proposed. What has happened may be regrettable and undesirable, but it is not sinister. Implausible case? The fourth ground for dismissing the application for special leave to appeal which has been relied on is said to be that it is far from clear that the "new case" is of substantial plausibility. Assuming this to be relevant at all, it is necessary to remember that the Privy Council said in Reid v The Queen60 that "it is not necessarily a condition precedent to the ordering of a 60 [1980] AC 343 at 350 per Lords Diplock, Hailsham of St Marylebone, Salmon, Edmund-Davies and Keith of Kinkel. Crennan new trial that the Court of Appeal should be satisfied of the probability that it will result in a conviction." Their Lordships said that even if on the second trial an acquittal is more likely than a conviction, a second trial can be ordered. While counsel for the accused pointed to factual difficulties in the contention which the prosecution wished to advance in the second trial, he did concede that if there were a second trial, the contention amounted to a case which could go to the jury. Parity of treatment for prosecution and defence. The fifth ground relied on for dismissing the application is that counsel for the accused could only have put a new argument to this Court in exceptional circumstances, and the same rule should apply to counsel for the prosecution. It may be accepted that the same principle should apply to both prosecution and defence when an attempt is made, in relation to the validity of a conviction, to rely on an argument in an appellate court which was not advanced at trial. It may also be accepted that that is so in relation to whether, after an appellate court has held that a criminal trial has miscarried on legal grounds, an order should be made for a new trial or an acquittal. But it has not been shown that acceptance of the prosecution's arguments in this case involves treating it any differently from the accused. Conclusion. Had the basis on which the prosecution wishes to proceed in the second trial been put to the Court of Criminal Appeal, the correct order would have been an order for a new trial. Grounds 2.1-2.3 Grounds 2.1-2.3 of the draft Notice of Appeal are as follows: "2.1 The Court of Criminal Appeal adopted an unduly narrow and erroneous approach to the determination of what constitutes a foundational crime for the purposes of ascribing liability to secondary parties to offences committed as possible incidents of that foundational offence. The Court of Criminal Appeal wrongly confined the definition of the foundational offence to an offence committed in the context of a contingency arising in the course of the joint enterprise without any, or proper, regard to the joint enterprise already in progress from which the contingency resulting in the incidental offence arose. This narrow approach to the definition of the foundational offence required the Crown to establish a separate foundational offence distinct from the joint criminal enterprise already in progress. Crennan The Court of Criminal Appeal erred in holding that a secondary participant in a joint criminal enterprise involving carrying loaded firearms from which a deliberate shooting eventuates cannot be guilty of either murder or manslaughter unless it can be established that there was a separate agreement to commit a foundational offence, distinct from the existing joint enterprise, arising from the circumstances immediately before the shooting, of which shooting was a possible incident." It is not necessary to deal with these grounds. The order which the prosecution seeks is an order that the Court of Criminal Appeal's verdict of acquittal be set aside and that in lieu thereof there be an order for a new trial. Whether that order should be made depends on what conclusion is reached about ground 2.4. Grounds 2.1-2.3 could be sound without affecting the verdict of acquittal, and they could be unsound without affecting the reasoning leading to the conclusion that there should be a new trial. The prosecution submitted that the Court of Criminal Appeal's supposed errors were important, and likely to affect other cases. That may be doubted: the Court of Criminal Appeal's reasoning is so closely linked to the particular facts of this case as to prevent it standing for any general principle of law. It must also be doubted whether the Court of Criminal Appeal fell into the errors alleged. Orders Special leave to appeal should be granted. The appeal should be allowed. The order of the New South Wales Court of Criminal Appeal entering a verdict of acquittal should be set aside, and in lieu thereof there should be an order for a new trial. Kirby KIRBY J. These proceedings come from orders of the Court of Criminal Appeal of New South Wales61. By those orders, that Court62 unanimously quashed the murder conviction of Mr Motekiai Taufahema ("the respondent"). That conviction was based on the respondent's liability as a party to a joint criminal enterprise63 resulting in the fatal shooting of a police officer, Senior Constable In place of that conviction, the Court of Criminal Appeal ordered that a verdict of acquittal be entered. It is against the latter order that the prosecution has sought special leave to appeal to this Court. The panel before whom the application for special leave was argued referred the application to be heard by a Full Court64. The application was duly argued as on the return of an appeal. As is usually the case, once matters reach this Court, there are arguments for both sides. However, consistently with the past authority of the Court and with the applicable legal principles, special leave to appeal should be refused. The background facts The circumstances of homicide: The facts are stated in other reasons65 and in the reasons of Adams J which constitute those of the court below66. On 27 March 2002, the respondent was one of four persons travelling in a motor vehicle which had been reported as stolen. He was driving the vehicle in a southern suburb of Sydney. The vehicle was noticed by the deceased, who was driving an unmarked police vehicle67. He pursued it, activating the siren and lights68. After attempting to accelerate away from the deceased's vehicle, the 61 Taufahema v The Queen (2006) 162 A Crim R 152. 62 Adams J; Beazley JA and Howie J concurring. 63 See reasons of Gleeson CJ and Callinan J at [6]-[10] ("joint reasons"). 64 [2006] HCATrans 526 at 460 per Gleeson CJ and Heydon J. 65 Joint reasons at [2]-[5]; reasons of Gummow, Hayne, Heydon and Crennan JJ at [42]-[45] ("majority reasons"). 66 (2006) 162 A Crim R 152 at 154-158 [2]-[15]. 67 (2006) 162 A Crim R 152 at 154-155 [5]. 68 (2006) 162 A Crim R 152 at 154 [2]. Kirby vehicle driven by the respondent soon came to a stop69 after hitting a gutter70. The occupants of the vehicle, including the respondent, hurriedly alighted. One occupant, Mr Sione Penisini, as he was leaving the vehicle, fired a number of shots in the direction of the deceased. One of these shots killed the deceased. Meanwhile, the respondent and the other occupants of the vehicle he was driving fled on foot. According to the respondent, Mr Penisini threw him an object wrapped in a bandanna which, as he caught it, he realised was a gun. In the course of his flight on foot, the respondent disposed of this object behind some flower pots in the backyard of a nearby house, but it was quickly recovered. After his apprehension, the respondent underwent interview by police that was electronically recorded. Essentially, he asserted that he was merely the driver of the vehicle and had gone along with his brother, Mr John Taufahema, a passenger who sat behind him in the vehicle. The respondent claimed he was unaware of the presence of the guns, or of gloves, a mask and pouch and extra bullets that were later found in or near the car. He stated that it had been his intention to alight from the car to visit a friend at a residence close to where the confrontation with the deceased had occurred. A defence witness, Mr Manuel Cackau, testified that he had agreed with Mr Penisini that they would commit armed robberies in Melbourne. He was waiting to be collected by Mr Penisini and the two other men (Mr John Taufahema and Mr Meli Lagi) when the deceased was killed. He, and not the respondent, had been the fourth man involved in the plan to proceed to Melbourne for this concededly criminal purpose71. All bar one of the occupants of the vehicle driven by the respondent were arrested on the day of the events resulting in the deceased's death72. Mr Penisini, the shooter, pleaded guilty to the offences of murder, unauthorised use of a firearm and attempted carjacking in circumstances of aggravation (the last offence occurring during his unsuccessful endeavour to escape police apprehension). The joint trial of the respondent together with Mr John Taufahema and Mr Lagi was listed to commence in August 2003 before Wood CJ at CL and a jury. However, the respondent's counsel was ill on that day, occasioning the postponement of his trial. The trial of his brother and Mr Lagi eventually proceeded. In the case of Mr John Taufahema, the trial resulted in jury verdicts of guilty of murder; of the use of an offensive weapon 69 See (2006) 162 A Crim R 152 at 154 [2]. 70 (2006) 162 A Crim R 152 at 155-156 [9]. 71 See also joint reasons at [15]. 72 The fourth man, Mr Lagi, was arrested some days later. Kirby with intent to prevent arrest; of attempted carjacking; and of use of a prohibited firearm. Mr Lagi was acquitted of murder but found guilty of the offences of using an offensive weapon in company to prevent arrest and possessing a prohibited firearm. In October 2003, sentences of imprisonment were imposed by Wood CJ at CL on each of those accused, and on Mr Penisini73. The trial of the respondent: When the delayed trial of the respondent commenced in March 2004 before Sully J and a jury, he was arraigned on an indictment containing three counts. The first count alleged that he had murdered the deceased. The second count alleged that he had shot at the deceased in company with Mr Penisini, his brother and Mr Lagi with intent to avoid lawful apprehension. The third count alleged possession of an unauthorised firearm. The respondent pleaded not guilty to all counts. The prosecution abandoned the second count during the trial. The jury returned verdicts of guilty on the first and third counts. On the conviction of possession of an unauthorised firearm, the trial judge sentenced the respondent to a fixed term of five years imprisonment to date from the commencement of his custody on 27 March 2002 and to expire on 26 March 2007. However, on the conviction of murder, the respondent was sentenced to 21 years imprisonment with a non-parole period of 14 years. This resulted in an overall sentence of 23 years imprisonment with a non-parole period of 16 years. It was the latter conviction alone that the respondent challenged in his appeal to the Court of Criminal Appeal. He did not contest his conviction and sentence in respect of the firearm offence. The respondent has been in custody since his arrest on 27 March 2002. At the time of the hearing of the present application, the respondent was serving his sentence for the firearm offence, which he is due to complete on 26 March 2007. The respondent has already served the balance remaining on an outstanding custodial sentence, which had been revived when a parole order, earlier made in an unrelated matter, was revoked after the respondent was apprehended in the foregoing circumstances. Notwithstanding the result in this case, the respondent is also serving a non-parole period for unrelated offences in respect of convictions entered on 27 May 2005. That sentence will expire on 26 November The prosecution did not assert that the respondent was guilty of personally using the firearm against the deceased or in that sense responsible for the deceased's homicide. The only footing upon which the prosecution propounded the guilt of the respondent for the crime of murder was on the basis of his being 73 On appeal, Mr John Taufahema's conviction for murder was quashed and a new trial ordered: Taufahema v The Queen [2007] NSWCCA 33. Kirby involved in an extended common purpose arising out of a joint criminal enterprise with other offenders. Much time was taken in the respondent's trial before Sully J to identify the "foundational crime" which the alleged offenders had agreed together to commit, in the execution of which the "incidental crime" was committed, namely the killing of the deceased74. In this Court, much of the argument was addressed to the attempt by the prosecution, which the respondent submits should not be allowed, to propound a "foundational crime" for a retrial that is different from that propounded by the prosecution whether before Wood CJ at CL or before Sully J or in the Court of Criminal Appeal75. It is this proposed shifting of ground on the part of the prosecution that enlivens the most important issues argued in the present application. At trial and on appeal An earlier joint trial: In respect of the earlier trial of the respondent's brother and Mr Lagi, the prosecution presented its case on the basis that the "foundational crime" was an offence against s 33B of the Crimes Act 1900 (NSW)76. That provision made it an offence for any person to use, attempt to use, threaten to use, or possess an offensive weapon, or to threaten injury to any person, relevantly, "with intent to prevent or hinder the lawful apprehension or detention … of himself … or hinder a member of the police force from investigating any act or circumstance which reasonably calls for investigation by the member". It was on this basis that Wood CJ at CL directed the jury in the joint trial in respect of the murder count against Mr John Taufahema and Mr Lagi. The jury in that proceeding were told that the prosecution had to prove that each accused "was party to a joint enterprise with the men who were in this company that, if faced with the possibility of being arrested, one or other of them would use a firearm with intent to prevent such arrest". That jury were also told that the accused might be convicted if "it was possible that, in using a firearm to prevent their arrest, the user would do so in a way that either resulted in the death of, or really serious bodily injury to, the person attempting to arrest them"77. 74 These are the expressions used by Hunt CJ at CL in Tangye (1997) 92 A Crim R 545 at 558, cited in (2006) 162 A Crim R 152 at 160 [19]. 75 For an analysis of the principles of "criminal complicity" in the context of this case, see joint reasons at [6]-[10]. 76 See also joint reasons at [21]. 77 Extracted in (2006) 162 A Crim R 152 at 160 [21]. Kirby There was no mention in this charge of a "foundational crime" of being a party to a joint enterprise to commit an armed robbery, or robberies, in Melbourne or anywhere else, in pursuance of which, the "incidental crime" of the homicide of the deceased had occurred. The "joint enterprise" was focussed exclusively on the alleged agreement, if faced with arrest, that one of the participating accused would use a firearm to prevent that possibility. The respondent's trial: When the respondent's trial was commenced before Sully J and a new jury, unsurprisingly perhaps, given the earlier trial of his brother and of Mr Lagi (and the successful outcome of the prosecution so far as the brother was concerned), the same approach was initially taken by the prosecutor. However, in the course of the respondent's trial, the prosecutor expressly withdrew the contention that the "foundational crime" was the alleged offence against s 33B of the Crimes Act. Instead, he relied on what was described as "an attempt to evade or avoid lawful apprehension"78. Moreover, in the Court of Criminal Appeal, the prosecution did not seek to sustain the trial contention that the "foundational crime" was an offence under s 33B79. Instead, in the Court of Criminal Appeal, the prosecution contended that the "foundational crime" was quite different, namely that created by s 546C of the Crimes Act80. That is a provision making it an offence for a person to resist or hinder a member of the police force in the execution of his or her duty. The prosecution did not, in terms, exactly resile from the case that had been put at trial. However, in the Court of Criminal Appeal, it contended that the prosecution was entitled to rely on the other "available offence", of hindering an officer in the execution of his duty81. Given the specific language of s 546C of the Crimes Act, the Court of Criminal Appeal was unwilling to extend that offence beyond preventing or hindering lawful apprehension to the broader offence of evading or avoiding lawful apprehension propounded as the "foundational crime" on the appeal to that Court. In this Court, the prosecution did not seek to contest the conclusions of the Court of Criminal Appeal in rejecting the successive ways in which, at trial or on appeal, it had propounded the relevant "foundational crime" to sustain the "extended common purpose" that it alleged had existed between the respondent and the other occupants of the vehicle. Instead, the prosecution propounded a 78 See (2006) 162 A Crim R 152 at 160-161 [22]. See also joint reasons at [16]-[22]. 79 (2006) 162 A Crim R 152 at 161 [22]. 80 (2006) 162 A Crim R 152 at 161 [24]. 81 (2006) 162 A Crim R 152 at 161 [24]. Kirby new, and quite different, joint criminal enterprise. This was allegedly that involving the men setting out to commit armed robbery, with loaded pistols (the foundational crime), in the course of doing which, the applicable "incidental crime" occurred, namely the intervention of a police patrol car and the confrontation with the deceased, in the course of which Mr Penisini shot the deceased and killed him. The respondent argues that, not only does this presentation of a new prosecution case amount to a case quite different from that propounded against him at trial, it was not even hinted at before the Court of Criminal Appeal. On this basis, the respondent submits that the prosecution should not have another fresh and different chance to secure his conviction on a completely distinct footing. The applicable legislation: The power of the Court of Criminal Appeal, in disposing of the respondent's appeal to it, was relevantly that set out in s 8(1) of the Criminal Appeal Act 1912 (NSW)82. This states: "On an appeal against a conviction on indictment, the court may, either of its own motion, or on the application of the appellant, order a new trial in such manner as it thinks fit, if the court considers that a miscarriage of justice has occurred, and, that having regard to all the circumstances, such miscarriage of justice can be more adequately remedied by an order for a new trial than by any other order which the court is empowered to make." One such order which "the court is empowered to make" is that provided in s 6(2) of the same Act. By that provision it is enacted: "Subject to the special provisions of this Act, the court shall, if it allows an appeal under section 5(1) against conviction, quash the conviction and direct a judgment and verdict of acquittal to be entered." The reference to s 5(1) is a reference to the right of appeal enjoyed by a person "convicted on indictment" where the appeal is taken to the court "(a) against the person's conviction on any ground which involves a question of law alone". The respondent's appeal to the Court of Criminal Appeal was such an appeal. He successfully alleged that there was "no evidentiary basis for a conclusion that [the respondent] was party to an agreement that all four men would attempt to evade the police officer, as distinct from having made a decision that he would attempt to do so and knew that the others would do the same"83. The Court also held that the prosecution case, based on s 546C of the 82 See also majority reasons at [48(e)]. 83 (2006) 162 A Crim R 152 at 165 [39]. Kirby Crimes Act, as propounded on appeal, was not that which had been propounded at trial. Thus, it held that it should not "order a new trial to permit such a different case to be put"84. Critically, the Court found that running away did not amount in law to "hindering" a police officer within s 546C of the Crimes Act. Hence, the "foundational offence" necessary to establishing a joint criminal enterprise involving the respondent was non-existent in each of the ways the prosecution had earlier sought to express its case85. The Court of Criminal Appeal: It was in the foregoing circumstances that the Court of Criminal Appeal addressed itself to the discretion which it enjoyed. This required it to consider whether the miscarriage of justice that the respondent had demonstrated should be cured by making "an order for a new trial" or by making the "other order" which it was empowered to make in the circumstances, namely the order of quashing the conviction and directing that a judgment and verdict of acquittal be entered. In the exercise of its discretion, and in the circumstances now sufficiently described, the Court of Criminal Appeal reached the conclusion that the "other order" should be made. It said86: "There is … no foundational offence or joint criminal enterprise upon which the Crown can rely for the purpose of establishing the culpability of the [respondent] for the (conceded) unintentional consequence of shooting the police officer. As the [respondent] could not be convicted of murder or manslaughter on the cases as formulated by the Crown both at trial and in this Court, it seems to me that it is not appropriate to order a new trial." This, then, is the way that the court below reached the conclusion that a verdict of acquittal should be entered. It so ordered. Now, the prosecution comes to this Court seeking special leave to appeal to propound its new and different basis for a conviction of the respondent of murder on the basis of a "joint criminal enterprise". Certainly, it is not the basis previously suggested. It was not the basis upon which the jury had originally convicted the respondent. Nor does it appear to have been the basis, in the joint trial, in which that jury convicted Mr John Taufahema. It had never been ventilated until after the Court of Criminal Appeal, within the issues before it, entered the verdict of acquittal in the case of the charge of murder against the 84 (2006) 162 A Crim R 152 at 165 [39] applying Chekeri (2001) 122 A Crim R 422 85 (2006) 162 A Crim R 152 at 165 [39]. 86 (2006) 162 A Crim R 152 at 165 [39]. Kirby respondent. Should such a course, so very belatedly advanced, now be permitted and facilitated by this Court? The issues The requirement of special leave: The immediate question is whether this Court should grant the prosecution's application for special leave to appeal and allow its appeal, in the circumstances disclosed, on the basis that, without relying on any new or different evidence, the prosecution should be afforded the opportunity of a retrial at which it might present the case against the respondent in a new and different way. Anterior to the resolution of that question is whether the applicant has demonstrated that the Court of Criminal Appeal erred in declining to order a retrial and in entering the verdict of acquittal in the circumstances of the case, although not on any basis then propounded before that Court. Other reasons in this Court have explored in some detail the background facts, the conduct of the trial and of the appeal, and the issues for decision87. However, to arrive at my orders, it is sufficient for me to recognise that, in disposing of the appeal to it, the Court of Criminal Appeal enjoyed a broadly expressed discretionary power to dispose of the appeal before it by ordering a new trial or by entering an acquittal. It elected in favour of the latter course. It did so on the basis of arguments put to it which the applicant now seeks, in this Court, substantially to abandon, alter and re-express. Changing course in this way is not impermissible in law. Nor are the arguments advanced by the applicant without force. However, a principled consideration of the arguments, in the disposition of a matter of such a serious character, attracts the application of well-established rules which it is the duty of this Court to apply, in a way conforming to law. Principles governing the application: The actual decision of the Court of Criminal Appeal to enter an order of acquittal of the respondent was made without extended elaboration. Doubtless this was because of the way in which the question of the disposition was presented to that Court for its decision. As this Court is now asked to grant special leave in order to reverse the disposition, and to order a new trial, three basic principles of law are enlivened. First, as has been said many times, this Court is not simply another court of criminal appeal. The Court's constitutional functions constitute it a court of 87 Joint reasons at [1]-[32]; majority reasons at [41]-[56]. Kirby error88. In discharging that responsibility, and considering an application for special leave to appeal, this Court is required to exercise its discretion, whether to grant or refuse special leave, so as to fulfil that function. In accordance with federal law, it is required to have regard, amongst other things, to considerations of national and public importance as to the state of the law and also to the interests of the administration of justice, including in the particular case89. Secondly, the Court of Criminal Appeal was obliged to perform its function, of deciding the order for the disposal of the appeal to it, by conforming to the legislation granting it jurisdiction and power. Relevantly, this required it to enter an order of acquittal or, if a demonstrated miscarriage of justice could "be more adequately remedied" by so doing, to order a new trial. An omission to advance a relevant ground of appeal before the Court of Criminal Appeal does not provide a constitutional barrier to a party later raising a fresh argument in this Court. The "error" in the disposition of the Court of Criminal Appeal may be demonstrated retrospectively, and objectively, by reference to a ground advanced for the first time in this Court, whilst the proceedings are still current before the Judicature90. So much has been said in respect of grounds of appeal advanced belatedly by an accused. In point of legal principle, the same must be true for a ground raised belatedly by the prosecution91. Thirdly, in recognition of the particular duties of the prosecution (particularly in the accusatorial form of criminal justice observed in Australia), its superior resources and the significant burden of repeated criminal trials on persons accused, special obligations must be assumed by the prosecution in an appeal, when seeking to overturn an order of acquittal. As Dixon J observed in 88 Mickelberg v The Queen (1989) 167 CLR 259 at 267, 279, 298-299; Eastman v The Queen (2000) 203 CLR 1 at 79-89 [240]-[266]. See also Australian Broadcasting Corporation v O'Neill (2006) 80 ALJR 1672 at 1696 [95]; 229 ALR 457 at 484. 89 Judiciary Act 1903 (Cth), s 35A. See Crampton v The Queen (2000) 206 CLR 161 at 173 [20] per Gleeson CJ: "[A] second appeal is intended to be reserved for special cases. It is not there for the purpose of giving any sufficiently determined and resourceful litigant a third chance of success." 90 Gipp v The Queen (1998) 194 CLR 106 at 116 [23] per Gaudron J, 154-155 [138] of my own reasons, and 161 [164] per Callinan J; Crampton (2000) 206 CLR 161 91 cf majority reasons at [57]-[58]. 92 (1948) 77 CLR 511 at 516. Kirby "An application for special leave to appeal from a judgment of acquittal is a rare thing." Such an appeal has been held to be constitutionally permissible93. However, it invokes "an exceptional discretionary power"94. Repeatedly, this Court95, intermediate courts96 and other courts, including the Privy Council97, in similar terms, have stressed that98: "It is not in the interests of justice as administered under the common law system of criminal procedure that the prosecution should be given another chance to cure evidential deficiencies in its case against the defendant." And, moreover99: "The Crown should not be permitted to present a quite different case through a new trial. … [I]t would be unfair to the appellant to order a new trial in which he would have to meet a significantly different case to that the jury were asked to consider." In particular circumstances, the foregoing broad statements have been adapted by reference to specific considerations relevant to the particular case100. 93 Lloyd v Wallach (1915) 20 CLR 299. But cf Secretary of State for Home Affairs v 94 Wilkes (1948) 77 CLR 511 at 516-517. 95 See eg King v The Queen (1986) 161 CLR 423 at 433; Jiminez v The Queen (1992) 173 CLR 572 at 590-591; Parker v The Queen (1997) 186 CLR 494 at 520-521, 96 See eg Anderson (1991) 53 A Crim R 421 at 453 per Gleeson CJ; Ibbs (2001) 122 A Crim R 377 at 384-386 [26]-[33] per Malcolm CJ; Chekeri (2001) 122 A Crim R 422 at 434 [57]-[61] per Howie J. 97 Reid v The Queen [1980] AC 343 at 349-350 per Lords Diplock, Hailsham of St Marylebone, Salmon, Edmund-Davies and Keith of Kinkel; Tsang Ping-nam v The Queen [1981] 1 WLR 1462 at 1467. 98 Reid [1980] AC 343 at 349-350. 99 Parker (1997) 186 CLR 494 at 520 per Dawson, Toohey and McHugh JJ. 100 Some such considerations are collected in Reid [1980] AC 343 at 349-350. Kirby In determining the present application for special leave, this Court must take all relevant considerations into account, having regard to the new arguments pressed upon it by the parties. In these reasons, I will first list a number of considerations which I recognise support a grant of special leave. I will then identify the competing considerations that ultimately persuade me that special leave to appeal should be refused. Considerations supporting a grant of special leave Extended common purpose criminal liability: In Clayton v The Queen101, six Justices of this Court rejected an application for special leave to appeal brought by three prisoners to challenge their convictions of murder on the basis of extended common purpose liability. The applicants criticised this aspect of the common law of Australia as expressed in earlier decisions of this Court102. They submitted that it was inconsistent with basic legal principles governing criminal liability for intended acts; that it was anomalous and asymmetrical in its operation considering other rules governing accessorial liability; that it was disproportionate in its consequences which include criminal punishment for mere possibilities found to have been foreseen by the accused; that it addressed the problem of anti-social group behaviour in an over-inclusive way; that it was needlessly complex for explanation to juries; and that it was destructive of an effective place for manslaughter to reflect varying degrees of moral culpability of individual accused for serious crimes committed incidentally to an unlawful joint purpose103. These criticisms, or some of them, might arguably be illustrated by the prosecution's accusation of murder against the present respondent. However, the respondent made no such complaint. His counsel accepted the law on extended common purpose liability. Following this Court's recent decision in Clayton, that was the correct position to adopt. Whatever doubts or hesitations existed earlier104 concerning the common law of Australia in this respect, the decision in Clayton has to be taken as settling the matter, at least for the present. It upholds the liability of secondary offenders 101 (2006) 231 ALR 500. 102 McAuliffe v The Queen (1995) 183 CLR 108; Gillard v The Queen (2003) 219 CLR 103 Clayton (2006) 231 ALR 500 at 522-528 [87]-[117]. 104 See Gillard (2003) 219 CLR 1 at 18-22 [46]-[54]. Kirby in those jurisdictions of Australia where the common law applies. Such liability exists where a primary offender has committed a crime within the contemplation of the secondary offender as a possible incident in the execution of their agreed joint criminal enterprise and thus within the scope of an unlawful extended common purpose. Since the present appeal was argued, the Court of Criminal Appeal of New South Wales has quashed the murder conviction of Mr John Taufahema and ordered a new trial of that charge105. This was done, in part, because that Court found a misdirection by Wood CJ at CL in respect of the elements of extended common purpose liability106. In Clayton107, one of the considerations that persuaded me to favour a re-expression of the common law on this subject was its needless complexity both for trial judges explaining the law to a jury and for juries comprehending and applying it. If two such able and experienced judges as Sully J and Wood CJ at CL, both undoubted experts in the criminal law, could err in their directions to the jury on this subject, something appears to be needed to render the law simpler and more comprehensible. The majority in Clayton108 rejected the opportunity. I must accept that decision. But this Court will see many more cases of this kind until the underlying law is re-expressed either by the Court or by Parliament in a way that addresses the present defects and uncertainties. In the present matter, the reaffirmation by the Court of extended common purpose liability was accepted by the Court of Criminal Appeal as the starting point for its analysis109. Leaving aside the way that, at trial and on appeal, the prosecution elected to present its case, and to identify there the "extended common purpose" of which it accused the respondent, there was evidence before the jury upon which the jury could potentially conclude, contrary to the respondent's sworn testimony, that he was more than a temporary driver relieving until Mr Cackau took over the driving to fulfil the alleged plan to commit armed robberies in Melbourne. The respondent's jury might have concluded that there was some joint criminal purpose, anterior to the incidental shooting of the deceased by Mr Penisini, that preceded any decision to use the weapons in the vehicle so as to escape apprehension. 105 Taufahema [2007] NSWCCA 33. 106 See Taufahema [2007] NSWCCA 33 at [27]-[36]. 107 (2006) 231 ALR 500 at 527-528 [113]-[117]. 108 (2006) 231 ALR 500 at 502 [2]-[3]. 109 (2006) 162 A Crim R 152 at 158-160 [18]. Kirby Evidence supporting such an inference, as called in the respondent's trial, included: the prior arrangements between the several accused; the four occupants of the car; the four guns that were carried in the car; and the mask and the ammunition found in the car. These facts might arguably combine to give rise to an inference of an anterior foundational crime long before the four participants turned their attention (if they did) to the risk of police apprehension and what they would do if it ever materialised. On the face of things, it would seem unlikely that so many guns would be carried in the vehicle to defend the occupants' right to have a suburban joy ride without police or other interruption. On this footing, there is merit in the prosecution's present complaint that, by focussing on any extended common purpose that the occupants of the vehicle (including the respondent) had concerning escape from the deceased police officer, the courts below subverted the operation of the extended common purpose doctrine by the overly narrow approach they took to defining the "foundational offence". In effect, they concentrated on the incidental, rather than the foundational, offence. On this reasoning, it would follow that the killing of the deceased was incidental to whatever purpose the occupants of the vehicle shared in setting out in the first place with so many weapons and with the disguises and additional ammunition they had. By focussing on the incidental crime, and any agreement that existed in respect of it, the trial of the respondent squandered the very substantial advantage that extended common purpose liability affords to the prosecution. Searching for the "lowest common denominator" foundational crime permits the prosecution to rope participants to any anterior agreement to commit that foundational crime into liability for incidental crimes committed by other participants in the course of the joint enterprise, foreseen as a possible consequence of its execution. This makes the clear specification of the foundational crime a matter of great importance. In order to fulfil the ambit of the doctrine of extended common purpose liability, as explained in McAuliffe v The Queen110 and confirmed in Clayton111, the prosecution now seeks the opportunity to re-express its argument as to the respondent's liability for murder of the deceased. It attempts to do so in a way apparently more harmonious with a correct understanding of that doctrine and a correct appreciation of the inferences available as to the anterior joint purpose of the occupants of the motor vehicle which the deceased police officer intercepted. Given that the present proceedings are still alive before the Judicature, in the 110 (1995) 183 CLR 108 at 113-114. See also joint reasons at [6]-[7]. 111 (2006) 231 ALR 500 at 502 [2]-[3]. Kirby form of the application for special leave to appeal to this Court, should the prosecution not now be given the chance, at last, to present its case against the respondent as the recently reaffirmed law of extended common purpose liability permits? Death of a police officer: Unlawful homicide is a serious challenge to the social order. But unlawful homicide of a police officer is a specially serious affront. As the evidence of this case shows, Senior Constable McEnallay was performing his duties in a proper and professional way when he was killed. His death imposes on those responsible for the prosecution of criminal offences arising from that happening a high duty to bring all those liable for related criminal wrongdoing to justice, in accordance with the full letter of the law. In R v Benz112, explaining the circumstances in which this Court would grant special leave against the decision of a court of criminal appeal quashing a conviction and entering a judgment and verdict of acquittal (or ordering a new "The circumstances available to the Crown to support an application for special leave to appeal will necessarily be limited to matters of public importance and will, for that reason, ordinarily be more confined than those available to support an application by a convicted person. It is in that sense that the grant of special leave to the Crown is said to be exceptional." The killing of a police officer in the course of discharging his lawful duties is self-evidently an event of public importance. To that extent, the prosecution of those who may be responsible for it in law affords a consideration in favour of the grant of special leave to ensure that such can take place. The proper function of a jury: The respondent's acquittal was ordered by the Court of Criminal Appeal. However, the jury had earlier returned a guilty verdict against the respondent, although on a basis which the prosecution does not now seek to support. The reasoning of the jury is unknown. However, it would not be surprising if the jury had rejected the evidence of Mr Cackau and of the respondent and reached a conclusion that the respondent was part and parcel of whatever joint purpose took the four offenders into their heavily armed journey on the day of the deceased's death. Whether this is so or not, it is not irrelevant 112 (1989) 168 CLR 110. 113 (1989) 168 CLR 110 at 131-132. Kirby that when the jury, the constitutional tribunal of fact, considered all of the evidence, they reached a conclusion adverse to the respondent. By inference, therefore, they dismissed his evidence that he was no more than a temporary driver of the vehicle intended for further criminal use by others114. In Reid v The Queen115, the Privy Council, enumerating some of the many factors deserving of consideration when deciding between entry of a verdict of acquittal and of an order for a new trial, endorsed observations of the Full Court of Hong Kong in Ng Yuk Kin v The Crown116. That Court had said that, even where an acquittal on a fresh trial is on balance more likely than a conviction: "It is in the interest of the public, the complainant, and the [accused] himself that the question of guilt or otherwise be determined finally by the verdict of a Jury, and not left as something which must remain undecided by reason of a defect in legal machinery." Those remarks were made in a case involving a charge of rape. However, the Privy Council observed that they stated "a consideration that may be of wider application than to that crime alone"117. An occasion of judicial error: It is for the prosecutor, within wide boundaries set by the law118, to determine how the prosecution's accusation will be presented against the accused. Once that determination is made, the prosecution is bound by the manner in which its counsel elects to present the case119. At the trial of the respondent, the prosecutor opened the prosecution case on the basis that there had been a joint criminal enterprise to "fire a weapon at Senior Constable McEnallay in order to avoid ... lawful apprehension". This was allegedly done with the contemplation of the possibility of death or serious injury being occasioned to the deceased. It is clear, from a later exchange between the prosecutor and the trial judge, that the framing of the prosecution case in this way entailed a considered decision on the prosecutor's part. 114 See also joint reasons at [15]-[22]. 115 [1980] AC 343 at 350-351. 116 (1955) 39 HKLR 49 at 60 per Gould, Gregg and Wicks JJ. 117 [1980] AC 343 at 350. 118 Note Mallard v The Queen (2005) 224 CLR 125 at 133 [17] referring to Grey v The Queen (2001) 75 ALJR 1708; 184 ALR 593. See also at 150-151 [64]-[67]. 119 Malvaso v The Queen (1989) 168 CLR 227 at 233; Everett v The Queen (1994) 181 CLR 295 at 303. Kirby At the conclusion of the evidence, the prosecutor stated that the alternative charge had been incorrectly framed as based on s 33A of the Crimes Act whereas the prosecution had actually intended to use the offence against s 33B as the foundational offence. That alternative charge was thus withdrawn by the prosecutor. That step led the respondent, through his counsel, to admit to his guilt of the third count on the basis of his possession of an unauthorised firearm after the shooting of the deceased. This, in turn, led to the respondent's conviction of that offence. This left only the single count of murder on the basis of extended common purpose to be tried by the jury. It was after the close of the evidence in the trial, and before the addresses, that the trial judge proposed an alternative foundational offence to the prosecutor as the basis for the invocation of the doctrine of joint criminal enterprise and extended common purpose responsibility. This was the offence of "avoiding lawful apprehension". The trial judge suggested that this could be attractive to the prosecution as it would permit the prosecutor, in his closing address, to "start off with a virtual no contest". It was in this way, on the following day in the trial, in his closing address to the jury, that the prosecutor proceeded to alter his case to assert a joint criminal enterprise of escaping from lawful apprehension. It was put to the jury that the respondent contemplated, in company with the other occupants of the vehicle, that a firearm might be used to effect escape from apprehension and that there was a risk of death or serious injury resulting, even if without specific intention on the part of the respondent or even the principal offender to kill the deceased or cause really serious injury120. As the Court of Criminal Appeal demonstrated (and is not now in dispute in this application), there was no such offence, as suggested by the trial judge, known to the law of the State121. It was not a common law offence. Nor was it an offence within the terms of ss 33B, 58 or 546C of the Crimes Act. To the extent that the prosecution belatedly advanced that theory, in the course of the trial and in the closing address to the jury, it erred. 120 The joint reasons note at [18] that this characterisation of extended common purpose liability invites error in so far as it disclaims the need to contemplate the requisite degree of intention on the part of the principal offender. See also Taufahema [2007] NSWCCA 33 at [27]-[36]. 121 (2006) 162 A Crim R 152 at 160-161 [20]-[24], 162 [27]. See also majority reasons at [48(b)]. Kirby Nevertheless, the error was one that arose as a result of the suggestion of the trial judge122. Of course, his Honour was attempting to narrow the issues and facilitate and simplify the trial, always a proper endeavour in itself. But the result was the introduction of an erroneous complication, not originally of the prosecution's own making. As it derived from a judicial initiative, the mistake that followed arguably attracts the further remarks of the Privy Council in Reid123: "[T]he interest of justice that is served by the power to order a new trial is the interest of the public ... that those persons who are guilty of serious crimes should be brought to justice and not escape it merely because of some technical blunder by the judge in the conduct of the trial or in his summing up to the jury." A retrial involves various burdens including expense and anxiety to the participants and inconvenience to the public124. However, in so far as the ultimately erroneous way by which the prosecution advanced the respondent's liability as a party to a joint criminal enterprise arose out of a judicial intervention, that consideration must be taken into account in deciding what should follow when assessing the prosecutor's own responsibility for the erroneous course that then followed at the trial. On the other hand the prosecutor had a full opportunity to criticise and reject the judicial suggestion. To the contrary, he embraced it with alacrity, endorsed it and adopted it as his own. Same evidence – arguable case: In presenting the different propositions which the applicant wishes to advance at a fresh trial, namely identification of the "foundational offence" as being participation with the other occupants of the motor vehicle in a joint criminal enterprise of armed robbery, the applicant disclaimed an endeavour to rely on fresh or new evidence at a second trial125. The applicant did not deny that, at the trial of the respondent, it had not formulated the foundational offence as that of participation in armed robbery. Nevertheless, in so far as the disinclination to order a new trial derives from a concern that the opportunity will be used to tender different evidence and to seek the conviction of the accused on the basis of an entirely new case, the applicant denied that this was its aim. In fact, the applicant was critical of the failure of those involved in the subject trial for failing to separate "the antecedent joint 122 See also majority reasons at [51]. 123 [1980] AC 343 at 349. 124 Reid [1980] AC 343 at 350. 125 See majority reasons at [68]. Kirby enterprise on which the men were embarked" from the "incidental offence" that then arose, namely the shooting of the deceased. On the face of things, there would arguably have been evidence in the testimony called before the jury in the subject trial, on the basis of which the jury might have concluded that the respondent was a party to whatever joint enterprise the occupants of the motor vehicle had when they organised the guns, extra ammunition, mask and other implements, long before the deceased came on the scene. The jury were not bound to accept the testimony either of the respondent or of Mr Cackau. Indeed, they may have rejected that evidence. Given that there were four persons in the vehicle and four guns (and given also the earlier arrangements by which the respondent went to some trouble to join the other occupants and also to drive the vehicle and attempt to evade a police car), the jury might have been persuaded to the requisite standard that whatever joint criminal purposes the other occupants had in mind, the respondent fully shared them. In short, it could not be concluded that, presenting the foundational offence as an agreement of the four occupants to engage in the same armed robbery or robberies, a conviction of the respondent on such a basis was unlikely. To the contrary, the alternative foundational offence now propounded seems entirely arguable and sensible. The only surprising consideration is that it did not so appear to the prosecution either in the subject trial of the respondent (or in the earlier trial involving his brother and Mr Lagi) or in the presentation of the appeal before the Court of Criminal Appeal. This is not, therefore, a case where the application should be approached on the basis that, at a second trial, the respondent would likely not be convicted126. Nor was it suggested, during argument, that any "evidence which tended to support the defence at the first trial would not be available at the new trial", concededly a powerful factor against an appellate court ordering a new trial127. This is not to say that the respondent's conviction would be a foregone conclusion at a new trial. Far from it. There was some evidence supporting the respondent's contention that he was no more than an accidental, temporary driver, and an imperfect and incompetent one, who became involved for a short but fateful journey, at the behest of his brother. Although the new presentation of the 126 cf majority reasons at [69]. 127 Reid [1980] AC 343 at 350. Kirby prosecution's case is not unpersuasive, whether it is of "substantial plausibility" is "far from clear"128. Ultimately, however, the prosecution merely sought the opportunity to present it for the verdict of a jury. Manslaughter and retrial: At the hearing before the Court of Criminal Appeal, the respondent sought to add a ground of appeal complaining about the failure of the trial judge to "leave the offence of manslaughter as an alternative verdict for the jury's consideration"129. The prosecution agreed to the addition of a ground of appeal raising that issue. The Court declared that it was "fairly arguable"130. It proceeded to deal with it in accordance with the observations of this Court in Gillard v The Queen131. The Court concluded that, in certain specified circumstances, the respondent would "only be guilty of manslaughter" and accordingly that "the alternative verdict of manslaughter must have been left to the jury and it would have been an error of law not to do so"132. The applicant argued in this Court133 that the only basis upon which manslaughter could properly be left to the jury would be if there were evidence to support the count of the indictment charging the respondent with murder. If the trial judge was mistaken in failing to direct the jury on manslaughter, the remedy for that omission would be not acquittal but a direction for a new trial in which a proper direction on manslaughter was given134. On this basis, the applicant suggested an inconsistency between the conclusion on the manslaughter ground of appeal and the ultimate disposition of acquittal entered by the Court of Criminal Appeal. 128 Joint reasons at [39]. 129 (2006) 162 A Crim R 152 at 163 [33]. 130 (2006) 162 A Crim R 152 at 163 [33]. 131 See (2006) 162 A Crim R 152 at 164 [35], citing Gillard (2003) 219 CLR 1 at 13- 132 (2006) 162 A Crim R 152 at 164-165 [35]-[37]. 133 See [2006] HCATrans 662 at 10-75, 515-615. 134 Gilbert v The Queen (2000) 201 CLR 414 at 423 [22], 442 [104]; Gillard (2003) 219 CLR 1 at 15 [30], 16 [35], 30 [85], 42 [134]. An exception arises where, for example, the prosecution does not seek an order for retrial: Griffiths v The Queen (1994) 69 ALJR 77; 125 ALR 545, noted by Corns, "The discretion of a Court of Appeal to order a new trial or a verdict of acquittal", (2006) 30 Criminal Law Journal 343 at 353. Kirby The prosecutor's proper function: Whilst not denying the availability of an order of acquittal in the present case, as a matter of law, the applicant also correctly pointed to a number of recent decisions of this Court in which the Court has emphasised the normal primacy of the prosecution authorities, within the Executive Government, in determining whether or not to put an accused person, whose first trial had miscarried, up for retrial. This deference to the prosecutorial discretion has been explained by reference to considerations derived from the separation of powers inherent in Australia's constitutional arrangements. That is to say, the prosecution operates within the Executive Government and is conventionally entrusted with the power and responsibility of deciding whether a new trial should be had after the failure of a first trial135. Various exceptions to this rule have been acknowledged in the cases including, relevantly, where "it would be wrong by making an order for a new trial to give the prosecution an opportunity to supplement a defective case"136. Another exception is where the evidence adduced at a first trial did not, and could not as a matter of law, prove the offence charged against the accused137. Observing this principle of restraint, in instances where an appellate court has concluded that a miscarriage of justice has occurred, even one probably involving the conviction of an innocent person, this Court in the exercise of its powers has generally left it to the prosecution authorities to decide whether or not to elect to have a retrial to renew its accusation of criminal wrongdoing138. Occasionally, in particular cases, the Court has specifically drawn to notice the possibility that, although a retrial is ordered, it might not in fact follow139. Nevertheless, ordinarily, this Court has left it to prosecuting authorities. The substitution of orders of acquittal has been rare; orders for retrial, on the other hand, are common140. 135 Dyers v The Queen (2002) 210 CLR 285 at 314 [81]; cf Crampton (2000) 206 CLR 161 at 173 [18]-[19]; Mallard (2005) 224 CLR 125 at 141-142 [43], 157-158 136 Dyers (2002) 210 CLR 285 at 314-315 [82], quoting Director of Public Prosecutions (Nauru) v Fowler (1984) 154 CLR 627 at 630. 137 Crampton (2000) 206 CLR 161 at 187-188 [64]-[65]. 138 See eg Mallard (2005) 224 CLR 125 at 142 [44], 158 [91]-[94]. 139 As in Stanoevski v The Queen (2001) 202 CLR 115 at 130 [61]; Dyers (2002) 210 CLR 285 at 297 [23]; Mallard (2005) 224 CLR 125 at 141-142 [43]. See also Corns, "The discretion of a Court of Appeal to order a new trial or a verdict of acquittal", (2006) 30 Criminal Law Journal 343 at 353-354. 140 Corns, "The discretion of a Court of Appeal to order a new trial or a verdict of acquittal", (2006) 30 Criminal Law Journal 343 at 355 (Tables 2 and 3). Kirby The applicant complained that, in this case, the Court of Criminal Appeal's order of acquittal had deprived the prosecuting authorities of the opportunity to consider and, if so decided, to propound a new case against the respondent to replace the defective theories of his liability for murder successively propounded by the original prosecutor141. If it could properly do so within the evidence called at the first trial, the applicant submitted that it should not be denied its normal entitlement to so decide. Other considerations: The applicant relied on a number of further considerations. Above all, it emphasised the submission that there was evidence to go to the jury and that the irregularity that had occurred in the first trial had been one of failing to present the case properly, rather than one involving a lack of evidence against the respondent142. It was also pointed out that, although the respondent had been acquitted of murder by order of the Court of Criminal Appeal, he had remained in custody, serving sentences for other crimes, including the firearm offence in the third count of the subject indictment to which he had eventually pleaded guilty. Accordingly, were this Court to set aside his acquittal and order a retrial, such an order would not involve his return to custody143. This is a specially burdensome attribute of interference with an order of acquittal where restoration of imprisonment may be the immediate consequence144. I acknowledge the force of the foregoing submissions. They were advanced with the usual skill and fairness of the Director of Public Prosecutions for New South Wales. However, I must now state the considerations that lead me to reject them. I do so acknowledging, as Latham CJ did in Wilkes145, that decisions on such matters will sometimes involve relatively small matters of difference – nowhere more so than where the legal issue that is addressed is whether this Court should grant or refuse special leave to appeal to challenge an order of acquittal in a criminal case. 141 cf Tran v The Queen (2000) 105 FCR 182. 142 cf Peacock v The King (1911) 13 CLR 619 at 641 per Griffith CJ. 143 cf majority reasons at [55]. 144 Everett (1994) 181 CLR 295 at 305. 145 (1948) 77 CLR 511 at 514-515. Kirby Special leave to appeal should be refused Discretionary order: no error: Because, under the Constitution, this Court's appellate jurisdiction is only enlivened by a demonstration of error, it is important to start with a recognition (which the applicant did not contest) that the Court of Criminal Appeal enjoyed the undoubted power and discretion to enter an order of acquittal in the respondent's appeal to it. Indeed, the premises upon which the prosecution argued its case in the intermediate court (now abandoned) ensured that the entry of an acquittal was strongly supportable, if not ultimately inevitable. For this Court to interfere with an order of such a discretionary kind, the applicant must not only secure special leave to appeal, itself "exceptional" or "very exceptional" where an order of acquittal has been made by the State's most senior judges146. It must do so in a case where what is demonstrated is not, as such, that the Court of Criminal Appeal erred in deciding the appeal before it on the basis then propounded, but that, retrospectively, for new grounds submitted for the first time in this Court, error can be shown on quite a new and different footing. In Crampton v The Queen147, following observations in the earlier decision in Gipp v The Queen148, this Court held that such a new ground could be raised (and was not incompatible with the Court's constitutional function as an appellate court of error). However, it also emphasised that special leave to appeal on such new ground would be granted only in "exceptional circumstances"149. In a sense, this is a manifestation of the deep-rooted principle of the law against double jeopardy in its various forms150. 146 Wilkes (1948) 77 CLR 511 at 516-517; Benz (1989) 168 CLR 110 at 111-112, 119-120, 127-128, 146. See also R v Lee (1950) 82 CLR 133 at 138; R v Glennon (1992) 173 CLR 592 at 595, 617, 618; R v Rogerson (1992) 174 CLR 268 at 289, 147 (2000) 206 CLR 161. 148 (1998) 194 CLR 106 at 154-155 [138]. 149 (2000) 206 CLR 161 at 173-174 [20]-[21], 206-207 [122], 216-217 [156], 219 [165]; cf Giannarelli v The Queen (1983) 154 CLR 212 at 221. 150 Everett (1994) 181 CLR 295 at 305. See also Pearce v The Queen (1998) 194 CLR 610 at 636 [90] citing Green v United States 355 US 184 at 187-188 (1957); R v Tait and Bartley (1979) 24 ALR 473 at 476-477. Kirby It follows that the case which the applicant now propounds must be thrice exceptional. It seeks "special" leave which, without more, is exceptional. It seeks to overturn a judicial order of acquittal, also exceptional. And it seeks to do so by relying on a ground, and issues, not presented below, which this Court has said will only be permitted in "exceptional circumstances". Procedurally and substantively, therefore, the applicant must establish a most exceptional case to succeed. No argument was suggested by the applicant to the effect that insistence on such considerations of exceptionality was inconsistent with this Court's constitutional function or with the statutory provisions for the grant of special leave151. On the basis of the established authority of this Court, the foregoing statements of the law mark out the very exceptional relief that the applicant is seeking from the Court. Statutory power for the order made: The powers granted to courts of criminal appeal vary, as between different jurisdictions in Australia. Presumably for this reason, a disparity has been observed in the practice of different courts of criminal appeal in entering verdicts of acquittal upon a demonstration of error in the conduct of criminal trials152. In New South Wales, the language of s 8(1) of the Criminal Appeal Act appears to require the appellate court to reach an affirmative conclusion that a demonstrated miscarriage of justice "can be more adequately remedied by an order for a new trial than by any other order" before a retrial may be ordered (emphasis added). This language affords some support to the remark of Griffith CJ in 1911, by reference to the then applicable Victorian statute, that the power to grant a new trial, following a successful criminal appeal resulting in the quashing of a conviction, was one to "be used with great caution" and not to "be granted as of course in every case"153. The terms of s 8(1) of the Criminal Appeal Act are doubtless also the source of the opinion expressed by Murphy J in King v The Queen, that where a criminal appeal succeeds, and a conviction is quashed, the prosecution bears the onus of demonstrating "that a new trial is the most appropriate remedy"154. However that may be, the discretion afforded by the legislation to the Court of 151 cf Rogerson (1992) 174 CLR 268 at 311-312. 152 The disparity is noted in Corns, "The discretion of a Court of Appeal to order a new trial or a verdict of acquittal", (2006) 30 Criminal Law Journal 343 at 355. At common law no power existed to permit the setting aside by a court of a jury verdict of acquittal once entered: see Everett (1994) 181 CLR 295 at 306. 153 Peacock (1911) 13 CLR 619 at 641. 154 (1986) 161 CLR 423 at 426. Kirby Criminal Appeal of the Supreme Court of New South Wales is undoubtedly a very broad one155. According to conventional principles of appellate review, such a discretionary disposition is not one that this Court would disturb simply because its judges might have reached a different conclusion or because intuitive feelings suggest to them a different outcome in the particular case. Here, the applicant has not identified any of the well-known bases for disturbance of the discretionary order of the Court of Criminal Appeal156. Nor has the applicant suggested that this Court was obliged in law or fact to exercise the discretion in favour of a retrial, still less for a party which did not now challenge the fact that the miscarriage of justice found on appeal was one which the prosecution's own conduct of the trial below had helped to bring about. Unless, therefore, the retrospective force of the new way that the prosecution wishes now to present the charge of murder against the respondent is sufficient to warrant that course, the conventional approach in this Court to respect discretionary orders made within the power of the court below would ordinarily restrain this Court from granting special leave or disturbing the order made. Rule forbidding a new case: It is important, in approaching the present application, to appreciate the strength and persistence of this Court's repeated statements that the prosecution should not be given an opportunity to make a new case which it had not made at the first trial. One of the reasons why the Court of Criminal Appeal entered the verdict of acquittal in the present matter, and not an order for a new trial, was the fact that, as presented to it, the case for the prosecution could not be sustained at any such retrial157: "As the [respondent] could not be convicted of murder or manslaughter on the cases as formulated by the Crown both at trial and in this Court … it is not appropriate to order a new trial." There was no error in this conclusion, given its premises. To the contrary, it complied with the repeated instruction of this Court. 155 King (1986) 161 CLR 423 at 433 per Dawson J; cf Gerakiteys v The Queen (1984) 153 CLR 317 at 321. 156 As stated, for example, in House v The King (1936) 55 CLR 499 at 504-505 per Dixon, Evatt and McTiernan JJ. 157 (2006) 162 A Crim R 152 at 165 [39]. Kirby Thus, in Jiminez v The Queen158, McHugh J stated: "[T]he sufficiency of evidence to support the charge is not the only factor to be considered. Other factors lead to the conclusion that, despite there being evidence which, if accepted, would make out a charge of culpable driving, a new trial should not be ordered. First, as a general rule, a new trial should not be ordered to enable the Crown to make a new case at a second trial. In the present case, a second trial would allow the Crown to make a case different from that which it put to the jury at the first trial. … When all the circumstances are taken into account, the interests of justice do not require that the [accused] should be put to the expense, stress and inconvenience of a new trial so that the Crown can put a case which it did not put at the first trial. The general rule that a new trial will not be ordered so that the Crown can put a different case at a second trial must prevail." It should be noted that the application of these remarks has not been confined to cases where, at any second trial, the prosecution might wish to adduce fresh evidence not presented at the first trial. Whilst that possibility would certainly reinforce the reluctance to order a retrial, it is by no means essential. What is decisive is the impermissible course of allowing the prosecution, having once failed, to enjoy a further opportunity to succeed on a different case, even within the same evidence. Essentially, this is what the applicant is now seeking to do in a retrial of the respondent. Rationale for the rule: The reasons for the reluctance of appellate courts to permit the prosecution a second chance to make its accusation good, are bound up, as the Privy Council put it in Reid159, with established features of the "common law system of criminal procedure". Those features are numerous but four of them are immediately applicable. They are all relevant to the determination that must now be made by this Court. They are: Under the Australian system of criminal justice the prosecution, whether the Crown or the State160, is a special party. By long-established convention and practice, the prosecution acts as a model litigant, exhibiting fairness in prosecutorial decisions and thereby contributing, 158 (1992) 173 CLR 572 at 590-591 (footnote omitted). 159 [1980] AC 343 at 349-350. 160 In Western Australia, prosecutions are now brought in the name of the State. See Acts Amendment and Repeal (Courts and Legal Practice) Act 2003 (WA), Pt 8, with operation from 1 January 2004. Kirby with the courts, to the observance of high standards of justice in criminal trials161; The accusatorial form of criminal prosecution, observed in Australia162, requires the prosecution to establish the criminal accusations made by it against an accused and to make good the precise offence charged in the indictment. Ordinarily, it is not for the accused to demonstrate innocence. If the prosecution, having framed and presented the indictment and the evidence in the way that it selects, fails, it should not normally "have a second chance"163; Involved in such restrictions is "an aspect of the principle of double jeopardy"164. This requires that normally, where a conviction has been quashed as a result of some defect in the prosecution at trial and where to order a retrial would permit the prosecution to make a new or different case before another jury, that facility will be withheld. Doing so protects the accused, safeguards the court's judicial processes and properly disciplines the prosecution; and . A further feature of the common law system is that litigants, as a general rule, are bound by the conduct of trials, as much in criminal as in civil litigation, by their legal representatives165. It is this consideration that in criminal appeals has put a limitation on the entitlement of accused persons to blame their trial counsel for what they claim, after conviction, were errors of law, fact, tactics or judgment resulting in a miscarriage of justice166. The corollary to this rule is that courts must be cautious in expanding the circumstances in which the prosecution will be permitted to blame its own original trial counsel for what is said to be a miscarriage of 161 Lawless v The Queen (1979) 142 CLR 659 at 677-678; Mallard (2005) 224 CLR 162 RPS v The Queen (2000) 199 CLR 620 at 630 [22]. 163 Parker (1997) 186 CLR 494 at 539. 164 Chekeri (2001) 122 A Crim R 422 at 434 [58]. 165 See Rondel v Worsley [1969] 1 AC 191 at 241; R v Birks (1990) 19 NSWLR 677 at 683-684; Crampton (2000) 206 CLR 161 at 173 [18], 217-218 [159]-[162]. 166 Crampton (2000) 206 CLR 161 at 218-219 [163] per Hayne J citing Giannarelli v Wraith (1988) 165 CLR 543 at 555-556. See also TKWJ v The Queen (2002) 212 CLR 124; Ali v The Queen (2005) 79 ALJR 662; 214 ALR 1; Nudd v The Queen (2006) 80 ALJR 614; 225 ALR 161. Kirby justice occasioned by a mistake by the prosecution in presenting the case in a defective way, resulting in an order of acquittal167. Burden of criminal prosecution: In Reid, the Privy Council acknowledged the special burden of repeated criminal prosecutions on an accused168: "[A]ny criminal trial is to some extent an ordeal for the defendant, which the defendant ought not to be condemned to undergo for a second time through no fault of his own unless the interests of justice require that he should do so." In this Court, similar, and still stronger, remarks have been made in many cases, particularly by Deane J. Thus, in Davern v Messel169, his Honour said170: "[W]hat is involved is essentially a choice between two competing points of view in support of each of which decisions and statements of authority can be called in aid. Ultimately, I have come to the conclusion that the preferable view is that, for the purposes of the application of the relevant principle, an acquittal on the merits includes an acquittal by the order of an appellate court of competent jurisdiction on an appeal instituted by an accused against his conviction. In reaching that conclusion, I am influenced by what I see as the rationale of the common law principle precluding appeals from acquittals and by the weight, as distinct from quantity, of authority. The 'universal maxim of the common law' that no person is to be brought into jeopardy more than once for the same offence … has been correctly described by Black J as 'one of the oldest ideas found in western civilization' with roots running deep into Greek and Roman times: Bartkus v Illinois171. It is reflected in the patristic maxim that 'not even God judges twice for the same act'. … In its extended application, it operates to preclude at least some appeals from verdicts of acquittal. The 'underlying idea' of the rule was said by Black J (Green v United States172) 167 See joint reasons at [37]. 168 [1980] AC 343 at 350. 169 (1984) 155 CLR 21. 170 (1984) 155 CLR 21 at 67. 171 359 US 121 at 151-152 (1959). 172 355 US 184 at 187-188 (1957). Kirby to be that 'the State with all its resources and power should not be allowed to make repeated attempts to convict an individual for an alleged offence' thereby subjecting him to embarrassment, expense, continuing anxiety and insecurity and 'enhancing the possibility that even though innocent he may be found guilty'." In his reasons in Davern, Deane J went on to describe the superior position typically enjoyed by the prosecution and the lasting burden which being prosecuted for a criminal offence represents for the accused173: "[I]n common law countries … both the prosecutor and the court in a criminal case are essentially emanations of the same entity. Regardless of whether it be seen or described in terms of the sovereign or the people, that entity is the State. It is the State that establishes and maintains the judicial system. It is the State that brings an accused person before that judicial system on a charge of an offence against the law of the State. It is in the State's favour that the overwhelming balance of power and resources will ordinarily lie. If, in that context, a competent court in the State's own system rules that the State's charge should be dismissed and makes an order that the person against whom the State has brought proceedings is acquitted and discharged, there is plainly much to be said for the view that, as a matter of ordinary fairness, that person should be entitled to be released both from custody and jeopardy on that charge. Put another way, the citizen who is told by a competent court of the State that the State's proceedings against him are resolved in his favour should not awake on the morrow to be told he faces renewed jeopardy on that charge either by reason of the institution by the State of new proceedings against him or by reason of an appeal by the State against its own court's decision." In R v Rogerson174, Deane J returned to give these words special emphasis in the context of a prosecution application for special leave to appeal to this Court against an acquittal of an accused person: "Inevitably, an accused person whose acquittal by a Court of Criminal Appeal is singled out for a comparatively rare grant of special leave to appeal to this Court is likely to feel, with some justification, that he or she has been singled out for adverse treatment."175 173 (1984) 155 CLR 21 at 67-68. 174 (1992) 174 CLR 268 at 291. 175 See also Walton v Gardiner (1993) 177 CLR 378 at 396-398 and Gill v Walton (1991) 25 NSWLR 190 at 200, 207, 217. Kirby The proper place at which a criminal accusation should normally conclude is at the trial176. As Deane J pointed out in Jago v District Court (NSW)177, "where an allegation of serious crime is involved, the burden of criminal proceedings first falls upon an accused at the time when [such an accusation is] threatened. ... [L]iberty is either destroyed by imprisonment or compromised by the restraints involved in release upon bail." Indeed, it remains at peril until final disposition. "In Mills v The Queen179, Lamer J identified some of the other 'vexations and vicissitudes' of pending criminal proceedings, namely, 'stigmatization of the accused, loss of privacy, stress and anxiety resulting from a multitude of factors, including possible disruption of family, social life and work, legal costs, uncertainty as to the outcome and sanction'. If none but the guilty were accused of crime, the harshness of the burden would be alleviated by the consideration that the accused had brought it upon himself by his criminal conduct and subsequent denial of guilt and by the fact that account could be taken of pre-trial incarceration in the ultimate sentencing process. In truth, of course, the innocent as well as the guilty are accused of crime and the notions of fairness and decency which sustain our society dictate that an accused is presumed to be innocent unless and until he is convicted. For a person who is innocent of wrong- doing, the burden involves undeserved mental, social and often financial damage. And that damage will not be erased by ultimate acquittal. Life may be resumed but the mental, social and financial scars will ordinarily endure." As the applicant pointed out, the respondent may not have been released to liberty following the Court of Criminal Appeal's order for his acquittal. Yet following the order of the Court of Criminal Appeal he was entitled, under ordinary circumstances, to consider that his ordeal on the charge of murdering the deceased police officer was at an end. Something truly "exceptional" is required for this Court now to revive it. Tactical decisions and even-handedness: A particular consequence of the "common law system of criminal procedure", and of its consequence that accused persons are ordinarily bound by the conduct of their legal representatives, has been a reluctance of courts of criminal appeal to permit an accused, having 176 Crampton (2000) 206 CLR 161 at 217 [157] per Hayne J. 177 (1989) 168 CLR 23 at 55. 178 (1989) 168 CLR 23 at 55. 179 [1986] 1 SCR 863 at 919-920. Kirby second thoughts on appeal, to challenge miscarriages of justice said to have arisen from tactical decisions made by trial counsel in the course of the trial. This reluctance has a very practical foundation. Such decisions are made in trials on countless occasions every day. If they were susceptible to being reopened on appeal, few forensic choices could be treated as final. Trials, and appeals, might never conclude. For this reason, in very many cases, this Court has declined to permit accused persons to reopen decisions made by counsel at trial, characterised as those made for tactical reasons180. There is no reason of principle why the same rule, holding the accused to the tactical decisions of legal representatives, should not apply with equal force to tactical decisions made at trial by prosecuting counsel181. Indeed, because defence counsel more frequently have less experience, expertise and resources, any principle of equality would require that the rule holding a party to the tactical choices made by trial representatives should apply with even greater rigour in the case of a prosecutor. For the present application, this Court should apply the same principle. There can be no doubt that, in this case, the framing of the indictment and the identification of the initial "foundational offence", propounded before the jury by the prosecutor, were carefully considered prosecutorial decisions. Inferentially, they were taken in a way that it was believed at the time best advanced the prosecution case against the respondent182. They were tactical decisions. Many such decisions are "technical"183. The prosecution should be held to them. If the prosecution is not, it will give rise to a justifiable conclusion that this Court does not hold the scales evenly but applies a different standard and a different rule to accused persons and their legal representatives from that which it applies to the prosecution. This is not a course that I would adopt. The rule holding parties to their trial tactics applies to a decision to alter course during the trial. In the present case such a decision was reached at the conclusion of the evidence, following the dialogue already described between the 180 Recent examples include Stanoevski (2001) 202 CLR 115 at 121-122 [21]; TKWJ (2002) 212 CLR 124 at 128 [8], 130-131 [16]-[17] per Gleeson CJ; cf at 132-135 [24]-[33], 137-138 [43], 139 [49] per Gaudron J, 157 [102]-[104] per Hayne J; cf my reasons in Gipp (1998) 194 CLR 106 at 151-155 [130]-[138] and Suresh v The Queen (1998) 72 ALJR 769 at 780 [56]-[58]; 153 ALR 145 at 160-161. See also Birks (1990) 19 NSWLR 677 at 686. 181 See joint reasons at [37]. 182 See above these reasons at [128]-[134]. 183 cf majority reasons at [51]. See also joint reasons at [10]. Kirby prosecutor and the trial judge184. A study of the transcript demonstrates that the prosecutor specifically acknowledged that he embraced the suggestion of the trial judge on the basis of what he described as the "KISS principle … that is keeping it simple"185. To reinforce the conclusion that this represented a conscious tactical decision on the part of the prosecutor, the transcript indicates that the prosecutor considered the matter over the luncheon adjournment and then still further overnight. It was only then that the alternative count based on s 33B of the Crimes Act was withdrawn and the prosecutor's first decision to change the expression of the foundational offence for "joint criminal enterprise" was made. In the course of his closing address on the following day, the prosecutor re-expressed the prosecution case to assert a joint criminal enterprise involving the respondent of "escaping from lawful apprehension". In this case, it cannot, therefore, be denied that it was for the tactical decision of keeping the prosecution case "simple" that the prosecutor elected to abandon the case as originally presented, on which he had earlier relied for the respondent's conviction. Instead, the prosecutor repeatedly told the jury that the prosecution case was that there was a joint criminal enterprise to escape and that the respondent was liable for murder as a result of an incident arising from that precise venture. It is quite wrong to ascribe to the trial judge the primary responsibility for what occurred186. He made a suggestion. But it was embraced and endorsed by the prosecutor after due deliberation. In these circumstances, the summary in the reasons of the Court of Criminal Appeal concerning the conduct of trial counsel for the applicant was accurate. So was that Court's description of the still further changes to the formulation of the "foundational offence" by the time the case reached the appeal hearing187. Whatever doubts might occasionally arise as to whether the decision of trial counsel for an accused person was truly made for "tactical reasons" (or was simply an ignorant, inexperienced or incompetent choice with which the accused is thereafter to be burdened by the operation of a convenient legal rule), there can be absolutely no doubt in the present proceedings of the conscious election of the prosecutor at the respondent's trial and appeal. An experienced 184 See above these reasons at [129]-[131]. 185 "KISS" for "Keep It Simple, Stupid", an admonition popularly ascribed to the urging of the wife of United States presidential candidate Hubert Humphrey whose failure to observe it deprived him of success in the election. 186 cf majority reasons at [51]. 187 (2006) 162 A Crim R 152 at 160-161 [20]-[22], 162 [27]. Kirby advocate took considered and deliberate decisions. At trial, he did so for the self-proclaimed tactical reason which he graphically described as motivated by "KISS". Consistently with less this Court's repeated compelling and considered circumstances) that accused persons are bound by tactical decisions made by their legal representatives, so must be the prosecution with its larger body of experience, expertise and resources. Any other approach would be lacking in the even-handedness that is the precious hallmark of equal justice as between the prosecution and the accused before our courts. insistence (in much In many courts, of different legal traditions, the prosecution is a special branch of government which enjoys an enhanced professional status akin to the judiciary. In such countries (as formerly in some of the old police courts in some parts of Australia) the prosecutor has a special and elevated seat in the court, higher than the ordinary Bar table and closer to the judicial bench. In Australia today, the prosecutor and the representatives of the accused appear at the same table and their equality before the law is enforced by the courts. We should not now waver and apply a different and unequal rule as to tactical decisions made by a prosecutor from that which we regularly apply to tactical decisions made by the legal representatives of the accused. Every time in the future that prosecutors argue that the accused cannot rely on a persuasive submission because of tactical decisions taken by their trial counsel, appellate courts will be obliged to remember this case. Other considerations: There are other relevant considerations mentioned during the argument that can be noted in passing. The applicant complained that the Court of Criminal Appeal's decision acquitted the respondent of all culpability for the shooting of the deceased police officer and precluded further proceedings in this respect against the respondent. However, it was the prosecution that, at trial, had abandoned the alternative charge against the respondent under s 33B of the Crimes Act. This resulted in the respondent's being convicted of the firearm offence for which he was sentenced to five years imprisonment. For his part, the actual perpetrator of the shooting of the police officer, Mr Penisini, pleaded guilty to murder. In consequence, he received a most substantial sentence of imprisonment for that most grievous crime. The respondent is still serving his sentence for the firearm offence, as well as for other unrelated offences188. He did not walk away scot-free from his involvement. Nor did the other two offenders. 188 See above at [84]-[85]. Kirby When, in all of the foregoing circumstances, I ask myself whether the triple requirement of an exceptional case is established to warrant this Court's granting special leave to the applicant to permit the prosecution to re-express its case in a way not advanced at trial or before the Court of Criminal Appeal in order to subject the respondent, although acquitted, to a new trial for murder on a different basis, I reach the conclusion that the request should fail189. I arrive at this conclusion without enthusiasm. I say this because it is at least arguable that, had the prosecution at the original trial of the respondent formulated its theory of the case as it now propounds it, and presented that theory clearly and simply throughout, the respondent might have been convicted of murder of the deceased police officer on the basis of liability as a secondary offender for an extended common purpose with the actual perpetrator of the fatal shots, Mr Penisini. Nevertheless, that was not the way the prosecution acted, either at trial or in the intermediate court. Consistently with long-established legal principles, often repeated and frequently applied, the prosecution should not at such a late stage have a new and different opportunity to overturn the respondent's acquittal because it has belatedly arrived at a new and different case which it now wants to present before a new and different jury. The impartial application of basic legal principles is the more important in criminal appeals because the circumstances in which such principles are invoked sometimes make it painful to apply the principles with judicial dispassion and complete even-handedness. Yet these are the features of the rule of law that is the bedrock of Australia's constitutional government and the best assurance of personal liberties190. It is the duty of the courts, including this Court, to give them effect. Order The application for special leave to appeal should be refused. 189 See also (2006) 162 A Crim R 152 at 165 [39]. 190 Australian Communist Party v The Commonwealth (1951) 83 CLR 1 at 193 per Dixon J; Kartinyeri v Commonwealth (1998) 195 CLR 337 at 381 [89]; Plaintiff S157/2002 v Commonwealth (2003) 211 CLR 476 at 513 [103]. Kirby

HIGH COURT OF AUSTRALIA AND PLAINTIFF COMMONWEALTH OF AUSTRALIA DEFENDANT Ruddick v Commonwealth of Australia [2022] HCA 9 Date of Hearing: 15 February 2022 Date of Order: 9 March 2022 Date of Publication of Reasons: 25 March 2022 ORDER The questions of law stated for the opinion of the Full Court in the Special Case filed on 3 December 2021 be answered as follows: Are any of items 7, 9, 11 and 14 of Sch 1 to the Electoral Legislation Amendment (Party Registration Integrity) Act 2021 (Cth) invalid, in whole or in part, on the ground that they infringe the implied freedom of political communication? Answer: In relation to items 11 and 14 of Sch 1 to the Electoral Legislation Amendment (Party Registration Integrity) Act 2021 (Cth), the answer is "No". Otherwise unnecessary to answer. Are any of items 7, 9, 11 and 14 of Sch 1 to the Electoral Legislation Amendment (Party Registration Integrity) Act 2021 (Cth) invalid, in whole or in part, on the ground that they preclude the direct choice by the people of Senators and Members of the House of Representatives, contrary to ss 7 and 24 of the Constitution? Answer: In relation to items 11 and 14 of Sch 1 to the Electoral Legislation Amendment (Party Registration Integrity) Act 2021 (Cth), the answer is "No". Otherwise unnecessary to answer. In light of the answers to Questions 1 and 2, what relief, if any, should issue? Answer: None. Who should pay the costs of and incidental to this special case? Answer: The plaintiff. Representation B W Walker SC with R Scheelings for the plaintiff (instructed by Speed and Stracey Lawyers Pty Limited) S P Donaghue QC, Solicitor-General of the Commonwealth, with B K Lim and C Ernst for the defendant (instructed by Australian Government Solicitor) M G Sexton SC, Solicitor-General for the State of New South Wales, with M W R Adams for the Attorney-General for the State of New South Wales, intervening (instructed by Crown Solicitor's Office (NSW)) J A Thomson SC, Solicitor-General for the State of Western Australia, with G M Mullins for the Attorney-General for the State of Western Australia, intervening (instructed by Solicitor-General's Office (WA)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Ruddick v Commonwealth of Australia Constitutional Law (Cth) – Parliament – Elections – Senate and House of Representatives – Senators and members of House of Representatives to be "directly chosen by the people" – Where amendments to Commonwealth Electoral Act 1918 (Cth) ("2021 Amendments") constrained political party applying for registration from using name, abbreviation or logo which had word in common with name or abbreviation of prior registered party without that party's consent – Where 2021 Amendments provided that existing party could not remain registered if earlier registered party objected to existing party's name or logo and that name or logo had word in common with name or abbreviation of earlier registered party – Whether 2021 Amendments precluded direct choice by the people of senators and members of House of Representatives. Constitutional Law (Cth) – Implied freedom of communication on government or political matters – Whether 2021 Amendments infringed implied freedom. Words and phrases – "ballot paper", "directly chosen by the people", "implied freedom", "informed choice", "legitimate purpose", "registered political parties", "voter confusion". Constitution, ss 7, 24, 64, 128. Commonwealth Electoral Act 1918 (Cth), ss 129, 129A, 134A, 210A, 214, 214A. Electoral Legislation Amendment (Party Registration Integrity) Act 2021 (Cth), Sch 1 items 7, 9, 11, 14. KIEFEL CJ AND KEANE J. The Liberal Democratic Party, of which the plaintiff is a member and the endorsed lead New South Wales Senate candidate for the forthcoming federal election, was registered under the Commonwealth Electoral Act 1918 (Cth) ("the Act") on 17 December 2008. The Liberal Democratic Party describes itself as "Australia's only classical liberal (or libertarian) political party". It is not disputed that a classic expression of liberalism as a political philosophy is to be found in John Stuart Mill's text On Liberty. Since that time the word "liberal" has been used in the name of a number of political parties and organisations in Australia, including Prime Minister Deakin's "Liberal Party", whence the Liberal Party of Australia derived its name in 1945. The Liberal Party of Australia states that its political philosophy is "individual freedom and free enterprise" or, as put in its constitution, "political liberty and the freedom and dignity of man". We gratefully adopt Gageler J's summary of the relevant facts and statutory provisions. The legislative items in question in the special case ("the impugned provisions") were inserted into the Act on 3 September 2021. They have the effect that an application for the registration of a political party must be refused by the Australian Electoral Commission ("the AEC"), or that a registered political party must be deregistered, if its name or logo contains a word that is in the name of a prior registered political party, unless that party consents to the use of the word. The Liberal Democratic Party has thereby become subject to deregistration on the objection of the Liberal Party of Australia because of its use of the word "liberal". We agree with Gageler J that the impugned provisions are invalid as inconsistent with the limitations placed on legislative power by ss 7 and 24 of the Constitution. We agree with the answers to the special case questions proposed by his Honour. The impugned provisions restrict or distort the informed choice of the people as electors, by preventing the presentation to them of a candidate's affiliation with their political party on a ballot paper, and by preventing the candidate from communicating that affiliation and what it entails to electors. There can be no substantial reason or justification for those restrictions, because the Act already provided the means by which any real likelihood of voter confusion could be ascertained and dealt with, in a manner which was effective for that purpose and did not burden the implied freedom of communication to the same extent1. 1 McCloy v New South Wales (2015) 257 CLR 178 at 210 [57], 217 [81] per French CJ, Kiefel, Bell and Keane JJ; Brown v Tasmania (2017) 261 CLR 328 at 371-372 [139] per Kiefel CJ, Bell and Keane JJ; LibertyWorks Inc v The Commonwealth (2021) 95 ALJR 490 at 509 [78] per Kiefel CJ, Keane and Gleeson JJ; 391 ALR 188 at 207. The amended provisions Prior to the insertion of the impugned provisions into the Act, s 129(1) of the Act relevantly provided that the AEC was to refuse an application for registration of a political party if, in its opinion, the name of the party that it wished to use for the purposes of the Act: so nearly resembles the name … of another political party (not being a political party that is related to the party to which the application relates) that is a recognised political party that it is likely to be confused with or mistaken for that name …; or is one that a reasonable person would think suggests that a connection or relationship exists between the party and a registered party if that connection or relationship does not in fact exist". The term "recognised political party" was defined by s 129(2) to mean: a Parliamentary party; a registered party; or a party registered or recognised for the purposes of a State or Territory law relating to elections and that had endorsed a candidate under its current name in an election for a State or Territory Parliament or Assembly in the previous five years. Section 129A(c) and (d) provided for the refusal of registration of a political party's logo on substantially the same grounds as s 129(1)(d) and (da). Section 134A(1) provided for the deregistration of a registered political party where the AEC was satisfied of like grounds as above, unless the party changed its name or logo. The scheme for registration of political parties was introduced into the Act in 1984 in the context of legislative provisions for the direct funding of political parties and reference to party affiliation on the ballot paper2. The latter is of evident benefit to both candidates and voters for what it may convey about a candidate. The provisions themselves are, as is expressed in s 129(1)(da) and otherwise implied, based upon what a reasonable person might think when faced with the name or logo of a political party on a ballot paper. It has not been suggested that there has been any difficulty in their application by the AEC, or the Administrative Appeals Tribunal ("the AAT") on merits review, or that any uncertainty has resulted from the decisions of those bodies. 2 Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 186 [1] per In Re Woollard and Australian Electoral Commission3, the AAT, constituted by Gray, French and R D Nicholson JJ, set aside a refusal of registration of a party named "liberals for forests" which had been made pursuant to s 129(1)(d) of the Act and substituted a decision that the name be registered. In their Honours' view4, the resemblance to the name of the Liberal Party of Australia by the use of the generic term "liberals" was limited. It was unlikely, their Honours held, that an elector seeing the two names on a ballot paper would draw the conclusion that "liberals for forests" is a political party related to the Liberal Party of Australia. It was not "likely" in the sense that there was a real chance that that would occur. In 2009 the AAT upheld5 the registration of the Australian Fishing and Lifestyle Party over the objection of the Fishing Party on similar grounds, namely that the words "and Lifestyle" were sufficient to distinguish the two parties such that a person would not be confused or mistaken. On the other hand, in an internal review by the AEC of a delegate's decision to register "The New Liberals", the AEC determined that the similarity between that name and the registered abbreviation "Liberal" was such as to be likely to result in electors being confused in distinguishing one party from the other6. The point presently to be made is not whether the above determinations were correct, but rather that the Act provided the means by which questions as to voter confusion arising from the names of political parties could be decided. The basis of the impugned provisions As earlier mentioned, the impugned provisions will result in a refusal of the registration, or the deregistration, of a political party where the party's name includes a word appearing in the name of another political party. An express (2001) 32 AAR 492. 4 Re Woollard and Australian Electoral Commission (2001) 32 AAR 492 at 507 [45]- 5 Re Fishing Party and Australian Electoral Commission (2009) 110 ALD 172. 6 Australian Electoral Commission, Review of the delegate's decision dated 3 June 2021 to register "The New Liberals", AEC reference LEX872, 7 December 2021 at <https://aec.gov.au/Parties_and_Representatives/Party_Registration/Registration_ Decisions/2021/electoral-commission-decision-mr-hirst.pdf>. available exception to the application of the impugned provisions is the word "democratic", although it is obviously commonly used by political parties. The Explanatory Memorandum to the impugned provisions states7 that the amendments to s 129: "are intended to minimise the risk that a voter might be confused or potentially misled in the exercise of their choice at an election due to a political party having a registered name or abbreviation similar to that of an unrelated registered political party." Although it explains8 that the word "democratic" was treated as an exception due to its widespread historical use and its connection to the intrinsic function of all Australian political organisations, no explanation is provided for why the excepted word would not also confuse or mislead. The impugned provisions can be traced to a recommendation by the Joint Standing Committee on Electoral Matters ("the JSCEM"), which is comprised of members of the House of Representatives and senators who are also members of registered political parties, in its Report on the conduct of the 2019 federal election and matters related thereto. The reasoning of the JSCEM9 may be summarised as follows. It is that the vote of the Australian Labor Party is impaired where the Democratic Labour Party is listed higher on the ballot paper and the vote of the Liberal Party of Australia is similarly impaired where the Liberal Democratic Party is listed higher on the ballot paper. Acknowledging, as is the fact, that that position is the subject of a "random draw", the report says that the order of names on a ballot paper can make a few percentage points difference in the result of a seat "because voters have been misled". The JSCEM considered that "voter choices and election outcomes should not be distorted by duplicative names appearing on the register of political parties". It may be observed that the report states a conclusion that voters are misled because of the random allocation of the location of a party name on the ballot paper rather than any effect of the name itself. The facts stated in the special case take 7 Australia, House of Representatives, Electoral Legislation Amendment (Party Registration Integrity) Bill 2021, Explanatory Memorandum at 9 [19]. 8 Australia, House of Representatives, Electoral Legislation Amendment (Party Registration Integrity) Bill 2021, Explanatory Memorandum at 8-9 [18]. 9 Australia, Parliament, Joint Standing Committee on Electoral Matters, Report on the conduct of the 2019 federal election and matters related thereto (December 2020) the matter no further. It is there said that in previous federal elections where the name of the Liberal Democratic Party appeared above the line on a Senate ballot paper and it drew a position to the left of the Liberal Party of Australia, the Liberal Democratic Party received a higher share of the vote than where it drew a position to the right of the Liberal Party of Australia. The defendant also relies upon an admission said to have been made by the plaintiff on the pleadings and a concession made publicly by Senator David Leyonhjelm of the Liberal Democratic Party as to the potential for confusion by reference to party names. We agree with the analysis of Gageler J on these. Nothing in the facts or opinions stated in the special case demonstrates that a word contained in the name of another, registered, political party of itself gives rise to a real risk of confusion on the part of voters as to the party affiliation of a candidate for election. What they do confirm is what political scientists refer to as "the donkey vote", namely the effect that a party's position on a ballot paper may have on its share of the vote. That in turn may be thought to be a consequence of compulsory voting. But the special case does not demonstrate that the potential for confusion is attributable to the use of a word in a party's name alone. Constitutional limitations The Constitution does not require any particular electoral system. Apart from limitations arising from the Constitution itself, the Constitution permits "scope for variety" in the details of an electoral system10. It is left to the Parliament to determine the type of electoral system, and that includes a scheme for the registration of political parties. It is no part of the role of this Court to pronounce upon aspects of an electoral system which are within the legislative power of the Parliament. It is the role of the Court to ensure that the limitations that the Constitution itself places upon legislative powers affecting the choice of the people as electors are observed. If they are not, the Court is duty bound to hold legislative provisions which are inconsistent with them to be invalid. As mentioned at the outset of these reasons, the constitutional limitations relevant to the impugned provisions arise from ss 7 and 24 of the Constitution. The first concerns the requirement there stated that senators and members of the House of Representatives are to be "directly chosen by the people". It may be inferred from that statement that the system of elections which may be provided for must satisfy the requirements of the constitutionally prescribed system of representative 10 Attorney-General (Cth); Ex rel McKinlay v The Commonwealth (1975) 135 CLR 1 at 56 per Stephen J. government11. The other limitation of which the Court spoke in Lange v Australian Broadcasting Corporation12, arising from ss 7 and 2413, is that legislation providing for an electoral system must not infringe the implied constitutional freedom on communication of matters of politics and government. The words of ss 7 and 24 have come to be accepted as a constitutional protection of the right to vote14. Their express requirement of a "direct choice by the people" and the notion of choice itself necessarily implies that the choice be free, fair and informed15. In Lange16, the Court explained that the choice spoken of is a true choice, one which gives an opportunity to electors to gain an appreciation of the available alternatives, and that the freedom of political communication enables the people to exercise a free and informed choice as electors. So implied freedom of political understood, communication gives effect to the requirement of choice by the people, which is fundamental to our system of representative government. the constitutionally guaranteed An impairment of choice has been said to require that there be a substantial reason for it to be constitutionally valid17. An impairment of or burden on the implied freedom of political communication requires that it be justified18. The level 11 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 557. (1997) 189 CLR 520 at 567. 13 And the other constitutional provisions referred to in Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 559-562. 14 Roach v Electoral Commissioner (2007) 233 CLR 162 at 174 [7] per Gleeson CJ. 15 See Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 560. 16 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 560. 17 Roach v Electoral Commissioner (2007) 233 CLR 162 at 174 [7] per Gleeson CJ, 199-200 [85]-[86] per Gummow, Kirby and Crennan JJ; Rowe v Electoral Commissioner (2010) 243 CLR 1 at 19-20 [22]-[24] per French CJ, 59 [161] per Gummow and Bell JJ, 121 [384] per Crennan J; Wotton v Queensland (2012) 246 CLR 1 at 34 [90] per Kiefel J; Murphy v Electoral Commissioner (2016) 261 CLR 28 at 51 [34] per French CJ and Bell J, 57 [50], 60 [61], 61 [63] per Kiefel J, 67 [84]-[85] per Gageler J, 106-107 [244] per Nettle J, 121 [291] per Gordon J. 18 McCloy v New South Wales (2015) 257 CLR 178 at 213 [68] per French CJ, Kiefel, Bell and Keane JJ; Brown v Tasmania (2017) 261 CLR 328 at 369 [127] per Kiefel CJ, Bell and Keane JJ; Comcare v Banerji (2019) 267 CLR 373 at 398-399 of justification must be commensurate with the extent of the burden19. In reality the requirements of a substantial reason and justification amount to the same thing. They both require that the legislative measure be proportionate to the purpose it seeks to achieve20. The system of registration under the Act provides for the presentation to the electorate of a choice of candidates who are seen to be affiliated with a political party. The name of the political party will almost certainly contain words which convey that the person is associated with a party which has a particular philosophy, policy platform or leadership. The word "liberal" is such a word. In the context of a legislative regime which provides for the presentation to the electorate of candidates affiliated with a political party, the impugned provisions deny that means of communication solely because of the use of the word "liberal" and do so even where its use will not, in fact, cause any elector to be confused or misled. The impugned provisions prevent an elector from identifying a candidate with all that is associated with the name of a political party with which that candidate is affiliated. In their effect, they are apt to restrict or distort the choice presented to an elector, and so they are not compatible with the irreducible minimum requirement of the Constitution that the choice presented to electors be an informed choice. It is not in dispute that the name of a political party appearing next to the name of a candidate on a ballot paper is a form of political communication. There can be no dispute that the impugned provisions burden the freedom and do so to a considerable extent. The decision in Mulholland v Australian Electoral Commission21 is not an impediment to such a conclusion, nor to the questions which follow as to whether the impugned provisions can be justified. We agree with Gageler J that the decision in Mulholland should be understood according to the issues there presented and the arguments there put. We would add that it is not entirely obvious that those [29] per Kiefel CJ, Bell, Keane and Nettle JJ; LibertyWorks Inc v The Commonwealth (2021) 95 ALJR 490 at 504 [45] per Kiefel CJ, Keane and Gleeson JJ; 391 ALR 188 at 199-200. 19 Brown v Tasmania (2017) 261 CLR 328 at 367 [118], 369 [128] per Kiefel CJ, Bell 20 Roach v Electoral Commissioner (2007) 233 CLR 162 at 199-200 [85]-[86] per Gummow, Kirby and Crennan JJ; Murphy v Electoral Commissioner (2016) 261 CLR 28 at 57 [50], 60 [61], 61 [63] per Kiefel J. (2004) 220 CLR 181. members of the Court identified by his Honour22 spoke with one voice on the question of whether a law, which excluded certain information from the register, burdened the freedom. The focus of the reasons of their Honours largely centred on whether the appellant needed to point to a right or entitlement to have provided the asserted means of communication23. Whether the same approach would now be taken to the freedom, and the effect upon it, may be doubted but need not be further considered. On any view, the conclusion reached in Mulholland cannot foreclose a consideration as to whether the implied freedom of political communication is burdened by these particular provisions. No substantial reason is shown for the significant impairment that the impugned provisions effect on the choice of electors; their significant burden on the freedom cannot be justified. They are directed principally to a problem which does not arise from a word in a party name, but rather from the location of the name on a ballot paper. In so far as they may have as a purpose the reduction of voter confusion, they do not need to go as far as they do. They are not necessary because, at the time the impugned provisions were inserted, there was an obvious and compelling alternative which is as practicable in achieving that purpose but does not unnecessarily impair choice or burden the freedom. The alternative is to be found in the provisions of ss 129(1), 129A and 134A(1) as they stood at that time. 22 McHugh J, Gummow and Hayne JJ, Callinan J, and Heydon J. See reasons of 23 Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 223 [105] per McHugh J, 245-247 [182]-[187] per Gummow and Hayne JJ, 297-298 [336]- [337] per Callinan J, 303-304 [354] per Heydon J. This special case in a proceeding in the original jurisdiction of the High Court raises for the opinion of the Full Court questions about the validity of certain Items in Sch 1 to the Electoral Legislation Amendment (Party Registration Integrity) Act 2021 (Cth) ("the Amending Act"). The impugned Items purport to insert provisions into the Commonwealth Electoral Act 1918 (Cth) ("the Act"). The effect of those provisions, if valid, would be to deny registration to, and compel deregistration of, a political party the name of which contains a word in the name of an earlier registered political party. Pursuant to those provisions, the Liberal Democratic Party (registered on 7 September 2007), of which the plaintiff is a member and by which the plaintiff has been endorsed as a candidate for election at the forthcoming election of senators for the State of New South Wales, faces deregistration on the objection of the Liberal Party of Australia (registered on 22 June 1984) if it does not change its name. The Liberal Democratic Party would then be incapable of reregistration under that name without the consent of the Liberal Party. The questions raised by the special case are as to the compatibility of the insertion into the Act of those provisions denying registration and requiring deregistration of political parties with two overlapping limitations on the power of the Commonwealth Parliament, under s 51(xxxvi) read with ss 10 and 31 of the Constitution, to make laws for the conduct of elections to the Senate and to the House of Representatives. One is the limitation inhering in the "constitutional bedrock"24 of the express requirement of ss 7 and 24 of the Constitution that senators and members of the House of Representatives be "directly chosen by the people". The other limitation is that which inheres in the implied requirement of ss 7 and 24 as well as of ss 6, 49, 62, 64, 83 and 128 of the Constitution that there be freedom of political communication25. At the heart of the express requirement of ss 7 and 24 of the Constitution, and centrally informing the implied requirement of freedom of political communication, is the twice-employed constitutional concept of choice by the people. The requisite choice by the people has been established by authority to be a "true choice", involving those of the people who are electors having "an opportunity to gain an appreciation of the available alternatives"26. Thus, the 24 Rowe v Electoral Commissioner (2010) 243 CLR 1 at 12 [1], quoting Roach v Electoral Commissioner (2007) 233 CLR 162 at 198 [82]. 25 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 559-562. 26 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 560, quoting Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at constitutionally mandated choice by the people is an "informed choice as electors"27. Lange v Australian Broadcasting Corporation28 establishes that any law made by the Commonwealth Parliament or by any State Parliament or Territory Legislature which, for any purpose and at any time, imposes a legal or practical impediment to receipt by electors of information capable of bearing on the making of an informed electoral choice must be demonstrated to satisfy two conditions in order to be justified as compatible with the implied freedom of political communication. The purpose of the law must be compatible with the constitutionally prescribed system of government. The manner in which the law pursues that purpose must also be compatible with the constitutionally prescribed system of government29. Coherence of constitutional principle and methodology requires that a law made by the Commonwealth Parliament which imposes a legal or practical impediment to receipt by electors of information bearing on them making an informed choice between candidates for election, both during and outside of an election period, must satisfy the same two conditions in order to be justified as compatible with the core operation of ss 7 and 24 of the Constitution – that senators and members of the House of Representatives be directly chosen by the people. Those two conditions have not been demonstrated to be satisfied by the impugned Items in the circumstances of this case. The sole attributed purpose advanced in argument by the Commonwealth in support of the impugned Items is the purpose of minimising confusion on the part of electors as to the party affiliation of candidates for election to the Senate and to the House of Representatives. There is, and could be, no dispute that the attributed purpose is compatible with the constitutionally prescribed system of government. The difficulty is with the manner in which the impugned Items might be thought to pursue that attributed purpose. The legislated discrimen by reference to which registration of a political party is denied, and by reference to which deregistration of a registered political party can be required – the mere fact that the name of the political party contains a word that is in the name of an earlier registered political party – has not been demonstrated to be necessary for the fulfilment of the attributed purpose. 27 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 560. (1997) 189 CLR 520. 29 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 561-562; McCloy v New South Wales (2015) 257 CLR 178 at 193-195 [2], 230-231 [126], Denial of registration of a political party prevents information about the party affiliation of candidates affiliated with that party from appearing on ballot papers for elections to the Senate and to the House of Representatives. The impugned Items accordingly create a legal impediment to the receipt by electors of information which bears on the making of an informed choice between candidates in the casting of their ballots. There is a further, indirect but substantial, consequential practical impediment to political communication. It is that the impugned Items render less effective the communication to electors, both during and outside of an election period, of information about the party affiliation of those candidates whose party affiliation cannot appear on the ballot paper. The limitations on the power of the Commonwealth Parliament under s 51(xxxvi) read with ss 10 and 31 of the Constitution imposed by the core operation of ss 7 and 24 of the Constitution and by the implied freedom of political communication are both thereby engaged. For want of demonstrated justification the impugned Items infringe both limitations. The best place to start to explain the pathway to that result is to note particular aspects of the pre-existing and continuing provisions of Pt XI of the Act governing the registration of political parties. The genesis and detail of the impugned Items can then be examined. Why the core operation of ss 7 and 24 of the Constitution must require the same justification as the implied freedom of political communication for a law which impedes receipt by electors of information bearing on making an informed electoral choice can then be addressed before finally explaining how those limitations are engaged and infringed by the impugned Items. The registration of political parties Political parties, being organisations the objects or activities of which are or include the promotion of the election to the Senate or to the House of Representatives of candidates endorsed by them30, have been a constant feature of national politics since federation. Provision for the registration of political parties was introduced by the insertion of Pt XI into the Act in 198431. The insertion was as an incident of a package of reforms which first allowed for the printing of the names and abbreviations of political parties on ballot papers as well as for the printing of ballot papers for elections to the Senate to include a horizontal line 30 See s 4(1) of the Act (definition of "political party"). 31 Upon the commencement of the Commonwealth Electoral Legislation Amendment Act 1983 (Cth). allowing electors the option of "above the line" voting for candidates or groups of candidates and "below the line" voting for individual candidates32. The purpose of then allowing for the printing of the names and abbreviations of political parties on ballot papers was spelt out in a report of the Joint Select Committee on Electoral Reform in 1983 as being to "assist voters in casting their vote in accordance with their intentions"33. Political parties at that time represented in the Senate and in the House of Representatives soon afterwards applied for and obtained registration. Those political parties included the Australian Labor Party (ALP), the Democratic Labour Party and the Liberal Party. The Liberal Party had been formed in 1945 by the then Leader of the Opposition, Robert Menzies. He deliberately borrowed the name of the party earlier formed by Prime Minister Alfred Deakin in 1909. The Australian Labor Party (originally named the "Australian Labour Party") had been formed in 1900, tracing its roots to colonial labour parties which had contested seats in colonial elections as early as 1891. The Democratic Labour Party (originally named the "Australian Labour Party (Anti-Communist)") had notoriously "split" from the Australian Labor Party in 195534. The broad architecture of the scheme for the registration of political parties in Pt XI of the Act has not altered since its introduction in 1984, although there have been numerous and frequent adjustments to its detail (including by the addition in 2016 of provision for the registration of party logos35). The Electoral Commissioner is required to establish and maintain a Register of Political Parties36. The Australian Electoral Commission ("the AEC") is required, on application37 and following public notification and consideration of 32 See now ss 209 and 214 of the Act and Forms E and F in Sch 1 to the Act. 33 Australia, Parliament, Joint Select Committee on Electoral Reform, First Report (September 1983) at 69 [3.43]. 34 See Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 249- 35 Section 126(2)(ba) of the Act, inserted by the Commonwealth Electoral Amendment Act 2016 (Cth). 36 Section 125 of the Act. 37 Section 126 of the Act. any objection38, to register a political party by entering the name of the party and any abbreviation of its name (as well as any party logo) in the Register if the AEC is satisfied that the political party can and should be registered in accordance with the Part39. The AEC is required to proceed in much the same way where it receives an application to change the registration of a registered political party, including by changing its registered name or abbreviation (or logo)40. There are also circumstances in which the AEC is required to deregister a political party by removing its name from the Register. They include if the AEC becomes satisfied on reasonable grounds that a specified condition for deregistration exists41. One of the specified conditions for deregistration is where an objection against the continued use of a name (or logo) has been upheld by the AEC42. A decision of the AEC is in each case subject to internal review within the AEC and to external merits review by the Administrative Appeals Tribunal ("the AAT")43. One of the preconditions to registration is that a political party must have and maintain a prescribed minimum number of members44. Correspondingly, one of the conditions for deregistration is if a registered political party fails to maintain that prescribed minimum number45. That element of the scheme, originally known as "the 500 rule", was unanimously held to withstand constitutional challenge in Mulholland v Australian Electoral Commission46. Further reference to Mulholland will need to be made later in these reasons in addressing the constitutional concept of informed choice. Leaving to one side the provisions purportedly inserted by the impugned Items, the names and abbreviations that are permitted to be registered for political parties have been and continue to be governed by s 129(1) and (2) of the Act. In 38 Section 132 of the Act. 39 Section 133 of the Act. 40 Section 134 of the Act. 41 Section 137 of the Act. See also ss 135 and 136 of the Act. 42 Section 137(1)(ca) of the Act. 43 Section 141 of the Act. 44 Section 123(1) (definition of "eligible political party") and s 124 of the Act. 45 Section 137(1)(b) of the Act. (2004) 220 CLR 181. the form in which they have existed since 200447, s 129(1) and (2) have provided and continue to provide: "(1) The [AEC] shall refuse an application for the registration of a political party if, in its opinion, the name of the party or the abbreviation of its name that it wishes to be able to use for the purposes of this Act (if any): comprises more than 6 words; is obscene, frivolous or vexatious; is the name, or is an abbreviation or acronym of the name, of another political party (not being a political party that is related to the party to which the application relates) that is a recognised political party; so nearly resembles the name, or an abbreviation or acronym of the name, of another political party (not being a political party that is related to the party to which the application relates) that is a recognised political party that it is likely to be confused with or mistaken for that name or that abbreviation or acronym, as the case may be; or is one that a reasonable person would think suggests that a connection or relationship exists between the party and a registered party if that connection or relationship does not in fact exist; or comprises the words 'Independent Party' or comprises or contains the word 'Independent' and: the name, or an abbreviation or acronym of the name, of a recognised political party; or (ii) matter that so nearly resembles the name, or an abbreviation or acronym of the name, of a recognised political party that the matter is likely to be confused with or mistaken for that name or that abbreviation or acronym, as the case may be. 47 Since the commencement of the Electoral and Referendum Amendment (Enrolment Integrity and Other Measures) Act 2004 (Cth). In this section: recognised political party means a political party that is: a Parliamentary party; or a registered party; or registered or recognised for the purposes of the law of a State or a Territory relating to elections and that has endorsed a candidate, under the party's current name, in an election for the Parliament of the State or Assembly of the Territory in the previous 5 years." In 2001, before the insertion of s 129(1)(da), the AAT (constituted by Gray, French and R D Nicholson JJ), on review of a decision of the AEC, found that the registration of a political party known as "liberals for forests" would not contravene s 129(1)(d) and decided that the party should be registered with that name48. The AAT said of the confusion or mistake to which s 129(1)(d) refers49: "The confusion or mistake that is relevant ... is that of the elector preparing to vote by marking the ballot paper at an election. It is the judgment of the elector in that brief time in the polling booth that is to be protected." Construing the expression "confused with or mistaken for" in s 129(1)(d) "according to the ordinary meaning of its words", the AAT observed that "[p]olitical parties in Australia use, and historically have used, in their names generic words such as 'Australia', 'liberal', 'labour', 'democrat', 'national', 'christian', 'progressive', 'socialist' and the like". The AAT opined that "[a]bsent clear language to contrary effect, the disqualifying provision is not to be construed so as to lock up generic words as the property of any organisation when it comes to names that can be used on the ballot paper"50. Addressing the content of the term "likely" in s 129(1)(d), the AAT gave the following unimpeachable explanation51: 48 Re Woollard and Australian Electoral Commission (2001) 32 AAR 492. (2001) 32 AAR 492 at 500-501 [23]. (2001) 32 AAR 492 at 505 [40]. (2001) 32 AAR 492 at 505 [38]. "The term 'likely', in this setting, is a direction to the [AEC] to make an assessment of the risk that registration will have the consequences referred to. That risk will not be remote or fanciful but, within the limits imposed by the language of the paragraph, will be relevant to the integrity of the voting process. It may be a risk seen as affecting all electors or it may be seen as affecting a proportion of that population. The assessment will have regard to the fact that not all electors are equally knowledgeable of political parties, nor equally intelligent in discriminating between different terms used on a ballot paper, nor equally literate in appreciating that terms do differ. The task of assessment involves a practical judgment. It is the kind of judgment which courts are frequently called on to make and one which administrators with the appropriate expertise are also required to make from time to time." In 2009, after the insertion of s 129(1)(da), the AAT (presided over by Tamberlin J) affirmed on review a decision of the AEC to register the "Australian Fishing and Lifestyle Party" over the objection of "The Fishing Party"52. The AAT reiterated the approach to s 129(1)(d) taken in 2001. The AAT identified the purpose of s 129(1)(da), like the purpose of s 129(1)(d), as being "to avoid confusion or mistake by voters at the ballot box"53. The AAT reasoned that "the words 'and Lifestyle' are sufficient to aurally and visually distinguish the two parties as separate entities without risk of confusion or mistake, and would prevent a reasonable person from thinking there was any connection or relationship between the two parties"54. The Liberal Democratic Party, as has already been mentioned, was registered in 2007. At the time of that initial registration, it was registered as the "Liberty and Democracy Party" with the abbreviation "LDP". On application, and over the objection of the Liberal Party, the AEC in 2008 changed the registered name of the "Liberty and Democracy Party" to the "Liberal Democratic Party" with the abbreviation "Liberal Democrats (LDP)". On further application, and again over the objection of the Liberal Party, the AEC in 2013 changed the registered abbreviation from "Liberal Democrats (LDP)" to "Liberal Democrats". On each occasion, the decision of the AEC to change the registration was affirmed on internal review. On neither occasion was the change found by the AEC to contravene either s 129(1)(d) or s 129(1)(da). On neither occasion did the Liberal Party seek review of the decision by the AAT. 52 Re Fishing Party and Australian Electoral Commission (2009) 110 ALD 172. (2009) 110 ALD 172 at 178 [39]. (2009) 110 ALD 172 at 179 [40]. The only section of the Act to address the continuing registration of the name or abbreviation (or logo) of a political party once that name or abbreviation (or logo) has been registered is s 134A. Leaving out provisions purportedly inserted by the impugned Items, s 134A in the form in which it has existed since 2016 provided and continues to provide: (aa) one registered political party (the parent party) was registered under section 126 before another registered party (the second party); and the [AEC] is satisfied that: the name or logo of the parent party is the same as, or relevantly similar to, the name or logo of the second party and the parties are not related at the time of the objection; or the name or logo of the second party is one that a reasonable person would think suggests that a connection or relationship exists between the second party and the parent party and that connection or relationship does not in fact exist; [and] the registered officer of the parent party objects in writing to the continued use of the name or logo by the second party; the [AEC] must: uphold the objection; ... For the purposes of paragraph (1)(a), the name or logo of a party is relevantly similar to the name or logo of another party if, in the opinion of the [AEC], the name or logo so nearly resembles the name or logo of the other party that it is likely to be confused with or mistaken for that name or logo. In this section: logo of a registered political party means the logo of the party that is entered in the Register. name, in relation to a registered political party, means: the name of the party that is entered in the Register; or the abbreviation, entered in the Register, of the name of the party." The language of s 134A(2) replicates the language of s 129(1)(d), just as the language of s 134A(1)(a)(ii) replicates the language of s 129(1)(da). The evaluative assessment required of the AEC, and of the AAT on review of a decision of the AEC, by s 134A(1)(a)(i) and (ii) when considering the deregistration of a political party is therefore essentially the same as the evaluative assessment required of those same entities by s 129(1)(d) and (da) when considering the registration of a political party. The impugned Items of the Amending Act The impugned Items of the Amending Act have their genesis in a recommendation of the Joint Standing Committee on Electoral Matters ("the JSCEM") in its 2020 Report on the conduct of the 2019 federal election and matters related thereto55. The members of the JSCEM then comprised senators and members of the House of Representatives from the Liberal Party, the National Party of Australia, the Australian Labor Party and the Queensland Greens. Participating members for the inquiry into the 2019 federal election included representatives of other political parties then represented in the Senate and the House including the Liberal National Party of Queensland, the Country Liberal Party (NT), Pauline Hanson's One Nation and Centre Alliance. The Democratic Labour Party had long since ceased to be represented in either the Senate or the House. The Liberal Democratic Party had ceased to be represented in the Senate as a result of the 2019 federal election. Recommendation 23 of the JSCEM in its 2020 report was that s 129 of the Act be amended "to permit the Electoral Commissioner to remove a name or a part of a name from an existing or proposed party that replicates a key word or words in the name of another recognised party that was first established at an earlier 55 Australia, Parliament, Joint Standing Committee on Electoral Matters, Report on the conduct of the 2019 federal election and matters related thereto (December 2020), recommendation 23. time"56. The totality of the reasoning of the JSCEM in support of that recommendation as set out in the report was as follows57: "Analysis of election results frequently includes commentary about how the Labor vote is impaired in some seats where the Democratic Labor [sic] Party is listed higher on the ballot paper, while the Liberal vote can be similarly depressed where the Liberal Democratic Party is listed higher. Accordingly, the random draw of candidate name order for a ballot paper can make a few percentage points difference to the result in a seat, because voters have been misled. The Committee considers that voter choices and election outcomes should not be distorted by duplicative names appearing on the register of political parties. Indeed the two instances referred above involve minor parties copying names of major parties, presumably for purposes of appealing to part of the same voter base. There is enough variety in the English language, to warrant party name registrations being distinguishable. It can be misleading and – some would even argue a form of 'freeloading' – for a party to replicate the public branding of another party rather than seek to build recognition and credibility in its own right." For the purpose of analysis in the present case, the impugned Items of the Amending Act can be narrowed to Items 7 and 11. Other impugned Items (those inserting machinery provisions as well as those dealing with logos) raise no distinct constitutional issues and do not call for separate analysis. Item 7 has the purported effect of adding the following command to the AEC at the end of s 129: "Names to be registered only with consent The [AEC] must refuse an application for the registration of a political party if: 56 Australia, Parliament, Joint Standing Committee on Electoral Matters, Report on the conduct of the 2019 federal election and matters related thereto (December 2020) 57 Australia, Parliament, Joint Standing Committee on Electoral Matters, Report on the conduct of the 2019 federal election and matters related thereto (December 2020) either of the following apply: the applicant party's name contains a word that is in the name, or the abbreviation of the name, of a registered political party; the proposed abbreviation of the applicant party's name contains a word that is in the name, or abbreviation of the name, of a registered political party; and the application is not accompanied by the written consent, to the use by the applicant party of the word in its name or abbreviation, of: if there is only one registered political party to which paragraph (a) applies – the registered political party's registered officer; or otherwise – the registered officer of the first such political party to be registered. Subsection (3) of this section, and [subsection] 134A(1), do not apply to: a function word; or a collective noun for people; or the name of a country, the word 'country', or a recognised geographical place in Australia; or the word 'democratic'. In applying subsection (3) or (5) of this section, or ... subparagraph 134A(1)(a)(iii), in relation to a word, other grammatical forms, and commonly accepted variants (including abbreviations, contractions and alternative forms), of the word are to be treated in the same way as the word." Item 11 has the purported effect of inserting into s 134A(1)(a), as an additional basis for the AEC upholding an objection by a "parent party", that: "(iii) the name or logo of the second party contains a word that is in the name, or abbreviation of the name, of the parent party; and". The materials before the Court demonstrate that, as a result of an objection having been made by the Liberal Party pursuant to s 134A(1)(a)(iii) as purportedly inserted by Item 11, the Liberal Democratic Party now faces the inevitability of deregistration if it does not change its name. By force of s 129(3) as purportedly inserted by Item 7, the Liberal Democratic Party could not thereafter be reregistered with the name it has had since 2008 without the consent of the Liberal Party. That denial of reregistration following deregistration is sufficient for the plaintiff to have standing to challenge Item 7 in addition to Item 11. Illustrating the operation of Items 7 and 11, and foreshadowed in the reasoning of the JSCEM in its 2020 report, is a fact which is not set out in the special case but which is a matter of public record and which was acknowledged by the Solicitor-General on the hearing of the special case. The fact is that an objection pursuant to s 134A(1)(a)(iii) as purportedly inserted by Item 11 has been made by the Australian Labor Party to the continuing registration of the Democratic Labour Party and has been upheld by the AEC58. That objection by the Australian Labor Party to the continuing registration of the Democratic Labour Party was made possible by an historical quirk of fate. Following the insertion of Pt XI into the Act, the Australian Labor Party was registered on 31 May 1984. Although the timing would have seemed of no significance at the time, the Democratic Labour Party was not registered until some weeks later, on 20 July 1984. The significance of that timing cannot be assumed to have been ignored in the drafting of Items 7 and 11. If the Democratic Labour Party is now to be deregistered through the operation of Item 11, s 129(3) as purportedly inserted by Item 7 would prevent reregistration of the Democratic Labour Party under the name by which it has been known since 1957 without the consent of its historical antagonist the Australian Labor Party. The explanatory memorandum to the Bill for the Amending Act explained the purpose of Item 7 as follows59: "The amendments in Item 7 are intended to minimise the risk that a voter might be confused or potentially misled in the exercise of their choice at an election due to a political party having a registered name or abbreviation similar to that of an unrelated registered political party. The amendments respond to Recommendation 23 from the JSCEM Report on the conduct of the 2019 federal election and matters thereto. The principle of the change 58 Notice of party registration decision: objection to continued use of a name and abbreviation – Australian Labor Party (ALP)'s objection to Democratic Labour Party (19 November 2021). 59 Australia, House of Representatives, Electoral Legislation Amendment (Party Registration Integrity) Bill 2021, Explanatory Memorandum at 9 [19]. is to ensure registered political parties are sufficiently distinct in name, while also providing appropriate exceptions for non-key words. The Macquarie Dictionary of Australia currently recognises over 138,000 distinctive headwords and phrases, almost all of which can be used for party names and allow parties to communicate their distinctive characteristics to the public." In respect of Item 11, the explanatory memorandum relevantly stated no more than that Item 11 "inserts new subparagraph 134A(1)(a)(iii) to provide an additional ground for the operation of the existing section 134A [which] reflects the amendment[] in Item[] 7"60. No further explanation of Item 11 appears in any other extrinsic material. Attention needs to be given to the exceptions to ss 129(3) and 134A(1)(a)(iii) for which provision is made in s 129(5) and (6). The explanatory memorandum explained the intended operation of the exceptions in s 129(5)(a)-(d) as follows61: "Item 7 also inserts new subsection 129(5) ... This reflects the intention of new subsection 129(3) to prevent the registration of party names and abbreviations that risk causing voter confusion with existing registered names and abbreviations. The phrases 'a function word', 'a collective noun for people', and 'the name of a country', and word 'country' in new subsection 129(4) are to be given their ordinary meaning. 'Collective noun for people' is intended to include words including, but not limited to 'Party', 'Group', 'Alliance', 'Network' and 'Team'. 'Recognised geographical place' is intended to include the name of Australian towns, cities, states and territories, as recognised by State, Territory and Commonwealth authorities ... 60 Australia, House of Representatives, Electoral Legislation Amendment (Party Registration Integrity) Bill 2021, Explanatory Memorandum at 10 [27]. 61 Australia, House of Representatives, Electoral Legislation Amendment (Party Registration Integrity) Bill 2021, Explanatory Memorandum at 8-9 [12]-[13], [15]- The word 'democratic' is treated as an exception, because it has a unique position as both being of widespread historical use in political party naming conventions, and being directly related to the intrinsic function of all Australian political organisations. The word can also be used to distinguish a political organisation from other forms of voluntary associations or professional groups that share a key word in its name." By way of explanation for s 129(6), the explanatory memorandum stated62: "Item 7 also inserts new subsection 129(6) ... This is intended to cover pluralisation and commonly accepted spelling variants of a word, for example, 'color' and 'colours'." The combination of the exceptions in s 129(5)(a)-(c) meant that no political party represented in the Senate or in the House of Representatives at the time of passage of the Amending Act became vulnerable to deregistration on the objection of any other, despite having common words or variants of words in their names. The exception in s 129(5)(d) meant that the Democratic Labour Party could not itself have objected under s 134A(1)(a)(iii) to the continuing registration of the Liberal Democratic Party or any other political party registered after 1984 having the word "democratic", or a variant of the word "democratic", in its name. The constitutionally mandated conditions of an informed choice The opening words of s 7 of the Constitution declare: "[t]he Senate shall be composed of senators for each State, directly chosen by the people of the State". The opening words of s 24 correspondingly declare: "[t]he House of Representatives shall be composed of members directly chosen by the people of the Commonwealth". Focusing on the second of those declarations, McTiernan and Jacobs JJ observed in Attorney-General (Cth); Ex rel McKinlay v The Commonwealth63 that, whilst those words are incapable of being "re-written or paraphrased" in an "exact manner", they "express a distinct concept or notion capable of application as a constitutional requirement". The words fall to be applied "to different circumstances at different times". The provision raises "a question of degree", which "cannot be determined in the abstract", and which "depends in part upon the 62 Australia, House of Representatives, Electoral Legislation Amendment (Party Registration Integrity) Bill 2021, Explanatory Memorandum at 8 [17]. (1975) 135 CLR 1. common understanding of the time"64. In the same case, Stephen J referred to the words as embodying principles of "representative democracy ..., direct popular election, and the national character of the lower House"65. Nothing in these reasons should be taken to detract from the force of those observations. For the purpose of the present case there is no need to attempt to expand on them. Except for the purpose of reinforcing consistency of constitutional methodology, the present case also affords no occasion to revisit the significance attributed to direct choice by the people in past decisions of this Court which have considered the options available to the Commonwealth Parliament in the exercise of the legislative power conferred on it by s 51(xxxvi) of the Constitution, read variously with ss 7, 8, 10, 24, 29, 30 and 31 of the Constitution, to determine the qualifications of electors66, to prescribe the manner in which electoral divisions are to be determined67, to determine whether or not choice by electors is to be compelled68, and to prescribe the manner in which choice by electors is to be expressed and interpreted69. The focus of attention in the present case can instead be confined to the specific quality of the constitutional concept of choice by the people authoritatively expounded in Lange – that it be an "informed choice"70. (1975) 135 CLR 1 at 35-36. (1975) 135 CLR 1 at 56. 66 See Roach v Electoral Commissioner (2007) 233 CLR 162; Rowe v Electoral Commissioner (2010) 243 CLR 1; Murphy v Electoral Commissioner (2016) 261 CLR 28. 67 See Attorney-General (Cth); Ex rel McKinlay v The Commonwealth (1975) 135 CLR 1; McGinty v Western Australia (1996) 186 CLR 140. 68 See Judd v McKeon (1926) 38 CLR 380. 69 See McKenzie v The Commonwealth (1984) 59 ALJR 190; 57 ALR 747; Langer v The Commonwealth (1996) 186 CLR 302; Day v Australian Electoral Officer (SA) (2016) 261 CLR 1. (1997) 189 CLR 520 at 560-561. In Lange, after reiterating the point made by Dawson J in Australian Capital Television Pty Ltd v The Commonwealth71 that "the choice given by ss 7 and 24 must be a true choice with 'an opportunity to gain an appreciation of the available alternatives'", the Court reasoned that, "[t]hat being so, ss 7 and 24 and the related sections of the Constitution necessarily protect that freedom of communication between the people concerning political or government matters which enables the people to exercise a free and informed choice as electors"72. "If the freedom is to effectively serve the purpose of ss 7 and 24 and related sections, it cannot be confined to the election period. Most of the matters necessary to enable 'the people' to make an informed choice will occur during the period between the holding of one, and the calling of the next, election. If the freedom to receive and disseminate information were confined to election periods, the electors would be deprived of the greater part of the information necessary to make an effective choice at the election." Hence, any Commonwealth, State or Territory law which at any time effectively burdens freedom of communication about government or political matters must meet the conditions of compatibility with the constitutionally prescribed system of representative and responsible government formulated in Lange74 and refined in subsequent cases75: first, that the purpose of the law be compatible with the constitutionally prescribed system of government; and second, that the manner in which the law pursues that purpose must also be compatible with that constitutionally prescribed system of government. (1992) 177 CLR 106 at 187. (1997) 189 CLR 520 at 560. (1997) 189 CLR 520 at 561. (1997) 189 CLR 520 at 561-562, 567-568. 75 See now McCloy v New South Wales (2015) 257 CLR 178 at 193-195 [2], 230-231 [126], [129], 258 [220], 280-281 [306]; Brown v Tasmania (2017) 261 CLR 328 at Fidelity to that understanding of "informed choice" expounded in Lange, and repeated many times since76, together with constancy of constitutional methodology, necessitate that the approach taken to ensuring the ability of the people to make an informed choice is no less stringent during the actual process of an election than it is during the period between one election and the next. It follows that a law made by the Commonwealth Parliament under s 51(xxxvi) read with ss 10 and 31 of the Constitution which has the legal or practical operation of excluding or impeding receipt by electors of information relevant to making an informed choice between candidates in the process of casting a ballot must be justified as satisfying the same two conditions in order to be compatible with the core operation of ss 7 and 24 of the Constitution whether or not the law might also engage the implied freedom of political communication. That conclusion as to the need for consistency of approach gains further support from Roach v Electoral Commissioner77 and Rowe v Electoral Commissioner78. There, laws made by the Commonwealth Parliament under s 51(xxxvi) read with ss 8 and 30 of the Constitution operated to exclude classes of people from the category of electors and were found not to satisfy exactly the same two conditions articulated in Lange. In consequence, those laws were held to be incompatible with ss 7 and 24 of the Constitution. Mulholland should not be understood as authority to the contrary. In that case "the 500 rule" was held to infringe neither the core operation of ss 7 and 24 nor the implied freedom of political communication despite the rule being recognised to have the effect of excluding the name of a political party having fewer than 500 members from appearing on a ballot paper. Mulholland's acceptance of the compatibility of "the 500 rule" with the core operation of ss 7 and 24 of the Constitution to require electors to have an opportunity to make an informed choice is best understood, using the language of Gleeson CJ, as resulting from the combination of two circumstances: that "[i]n the context of a system of registration of political parties ... the imposition of a requirement of some minimum level of support ... [is] consistent with the 76 McCloy v New South Wales (2015) 257 CLR 178 at 193-194 [2]; Unions NSW v New South Wales ("Unions No 2") (2019) 264 CLR 595 at 614 [40]; Gerner v Victoria (2020) 95 ALJR 107 at 114 [24]; 385 ALR 394 at 401. (2007) 233 CLR 162 at 174 [7], 182 [23]-[24], 198-199 [83], 199-200 [85]-[86], 202 (2010) 243 CLR 1 at 19-21 [23]-[26], 56-62 [150]-[168], 118-121 [372]-[385]. constitutional concept of direct choice by the people"79; and that "the number 500 is not so large as to be outside the range of choice reasonably available to Parliament if a number is to be chosen at all"80. On that basis, Mulholland is best understood as a case in which both conditions expounded in Lange for compatibility with ss 7 and 24 of the Constitution, both in their core operation and in the context of the implied freedom of political communication, were readily found to be satisfied. The combination of circumstances which led to satisfaction of the conditions for compatibility with the core operation of ss 7 and 24 of the Constitution also meant that "the 500 rule" did not infringe the implied freedom of political communication if and to the extent that the rule imposed a legal or practical impediment on the communication or receipt by electors of information capable of bearing on the making of an informed choice. A majority of the Court – Gleeson CJ81, Kirby J82, Callinan J83 and Heydon J84 – each so reasoned. The conclusion of an overlapping majority of the Court – McHugh J85, Gummow and Hayne JJ86, Callinan J87 and Heydon J88 – that "the 500 rule" did not burden political communication at all is more problematic. The conclusion needs to be understood in the context of how argument was joined. The argument for the appellant emphasised the legal operation of the rule to exclude a political party having fewer than 500 members from registration and thereby to exclude from the ballot paper reference to the affiliation of a candidate with that excluded political (2004) 220 CLR 181 at 195 [26]. (2004) 220 CLR 181 at 192 [20]. (2004) 220 CLR 181 at 200-201 [41]. (2004) 220 CLR 181 at 270-273 [261]-[267], 279 [292]. (2004) 220 CLR 181 at 297 [333]-[335]. (2004) 220 CLR 181 at 305 [357], 306 [362]. (2004) 220 CLR 181 at 223-224 [105]-[107]. (2004) 220 CLR 181 at 245-246 [182]-[183], 247 [186], 248-249 [191]-[192]. (2004) 220 CLR 181 at 297-298 [336]-[337]. (2004) 220 CLR 181 at 303-304 [354], 305 [356]. party89. The response to that argument put by the Attorney-General of the Commonwealth, intervening, was that a communication by means of the ballot paper is not a communication between people and is for that reason beyond the scope of the protection of the implied freedom90. Within the parameters of those competing arguments, members of the Court other than Gleeson CJ and Kirby J were persuaded to the view that exclusion of information relevant to electoral choice from the ballot paper did not of itself burden freedom of communication because it did not impede the exercise of a liberty to communicate that existed independently of executive action91. That conclusion is not uncontroversial92 and might be thought to be open to reconsideration in light of subsequent reasoning in Brown v Tasmania93. The conclusion was not sought to be relied on in response to an argument put in Day v Australian Electoral Officer (SA)94, to the effect that the implied freedom of communication was infringed by aspects of the form of a ballot paper of which complaint was made in that case95, and played no part in the Court's unanimous rejection of that argument96. That said, the conclusion of five members of the Court in Mulholland that "the 500 rule" did not burden political communication because it did not impede the exercise of liberty to communicate that existed independently of the ballot paper was not sought to be reopened in the present case. The conclusion must be respected. Without now departing from that conclusion in Mulholland, the conclusion cannot be taken to deny the potential for political communication to be burdened, and the implied freedom thereby to be engaged, to the extent that exclusion from (2004) 220 CLR 181 at 183. (2004) 220 CLR 181 at 184. (2004) 220 CLR 181 at 184. 92 See Stellios, Zines's The High Court and the Constitution, 6th ed (2015) at 567-570, (2017) 261 CLR 328 at 383-386 [183]-[189]. (2016) 261 CLR 1. (2016) 261 CLR 1 at 19 [37E]. (2016) 261 CLR 1 at 25 [57]. a ballot paper of reference to the party affiliation of a candidate can be found to impose a practical impediment to communication of information relevant to electoral choice in the exercise of the liberty of communication which exists at common law. If the name of the political party with which a candidate is affiliated cannot appear with the name of that candidate on a ballot paper, standard methods of communication with electors by political advertising such as billboards, corflutes and how-to-vote cards linking the candidate with the political party will inevitably be less effective. There is a distinct air of unreality in the argument put by the Commonwealth to the contrary. The reality, as fairly put on behalf of the plaintiff, is that "no political party would spend money on campaign advertising using one party name, when the ballot contains a different party name". Before leaving Mulholland, an observation of Gummow and Hayne JJ97 with which Kirby J agreed98 deserves to be highlighted. The observation is to the effect that an appreciation of the interests involved in considering the operation of ss 7 and 24 of the Constitution is assisted by reference to experience in the United States captured in an observation of Professor Laurence Tribe. The observation quoted by their Honours was99: "Few prospects are so antithetical to the notion of rule by the people as that of a temporary majority entrenching itself by cleverly manipulating the system through which the voters, in theory, can register their dissatisfaction by choosing new leadership." Professor Tribe continued100: "Constitutional review of election and campaign regulation amounts, in large part, to accommodating the fear of a temporary majority entrenching itself with the necessity of making the election a readable barometer of the electorate's preferences. It is not surprising, therefore, that the vigor of judicial review of election laws has been roughly proportioned to their potential for immunizing the current leadership from successful (2004) 220 CLR 181 at 237-238 [157]. See also Murphy v Electoral Commissioner (2016) 261 CLR 28 at 70-71 [95]. (2004) 220 CLR 181 at 257 [223]. 99 Tribe, American Constitutional Law, 2nd ed (1988) at 1097 §13-18. See also Issacharoff and Pildes, "Politics As Markets: Partisan Lockups of the Democratic Process" (1998) 50 Stanford Law Review 643 at 644-652. 100 Tribe, American Constitutional Law, 2nd ed (1988) at 1097 §13-18 (footnotes omitted and original emphasis). attack. Thus, courts have reviewed rather summarily laws that specify eligibility requirements for particular candidates, but have more carefully appraised the fairness and openness of laws that determine which political groups can place any candidate of their choice on the ballot." The observation resonates with an observation made by Mason CJ in Australian Capital Television101 by reference to experience in Australia. Having stated that "[t]he raison d'être of freedom of communication in relation to public affairs and political discussion is to enhance the political process (which embraces the electoral process and the workings of Parliament), thus making representative government efficacious", Mason CJ continued: "The enhancement of the political process and the integrity of that process are by no means opposing or conflicting interests and that is one reason why the Court should scrutinize very carefully any claim that freedom of communication must be restricted in order to protect the integrity of the political process. Experience has demonstrated on so many occasions in the past that, although freedom of communication may have some detrimental consequences for society, the manifest benefits it brings to an open society generally outweigh the detriments. All too often attempts to restrict the freedom in the name of some imagined necessity have tended to stifle public discussion and criticism of government." The present relevance of those observations is twofold. They reinforce the appropriateness of approaching the core operation of ss 7 and 24 of the Constitution consistently with the approach taken to the implied freedom of political communication. They serve also to orientate and calibrate the appropriate intensity of judicial scrutiny. The reasoning of at least six members of the Court in Brown102 supports the proposition that the nature and extent of the impediment to receipt by electors of information capable of bearing on informed electoral choice imposed by a law can bear on the intensity of the judicial scrutiny warranted to determine whether the manner in which the law pursues its attributed purpose is compatible with the constitutionally prescribed system of government. 101 (1992) 177 CLR 106 at 145. 102 (2017) 261 CLR 328 at 367 [118], 369 [128], 389-390 [200]-[202], 423 [291], 460 My own preferred expression of that proposition, which I explained in Brown103, adopts the language of Mason CJ in Australian Capital Television104 as picked up by Gleeson CJ in Mulholland105 to say that a law directed to political communication which discriminates between political viewpoints demands the application of a test of strict necessity consistent with the need for a "compelling justification"106. That standard of justification is especially appropriate to be applied to a law which discriminates in favour of incumbency. It is the standard to be applied in the circumstances of the present case. Unions NSW v New South Wales ("Unions No 2")107 confirms that the onus of demonstrating, to the appropriate standard of justification, that the manner in which a law pursues its purpose is compatible with the constitutionally prescribed system of government rests on those who seek to uphold its validity. The absence of a compelling justification for the impugned Items At least to the extent that they would, if valid, restrict receipt by electors by means of a ballot paper of information about the party affiliation of a candidate for election to the Senate or the House of Representatives, the impugned Items engage the core requirement of ss 7 and 24 of the Constitution. At least to the extent that they would in those circumstances operate practically to impede communication to electors of information about party affiliation, the impugned Items also engage the implied freedom of political communication. Plainly enough, the purpose of the impugned Items would not be compatible with the constitutionally prescribed system of government were their purpose identified simply by reference to their immediate effect – the deregistration of and denial of reregistration to one political party in the name of which is a word that is also in the name of an earlier registered political party. The system of representative and responsible government prescribed by the Constitution does not admit of incumbent political parties giving themselves monopolies over words that express political ideologies. The Commonwealth attributes to the totality of the impugned Items the wider purpose of minimising confusion on the part of electors as to the party 103 (2017) 261 CLR 328 at 389-390 [201]-[202], quoting Tajjour v New South Wales (2014) 254 CLR 508 at 580-581 [151]. 104 (1992) 177 CLR 106 at 143. 105 (2004) 220 CLR 181 at 200 [40]. 106 (1992) 177 CLR 106 at 143. 107 (2019) 264 CLR 595. affiliation of candidates for election to the Senate and to the House of Representatives. That is consistent with the purpose attributed to Item 7 in the explanatory memorandum to the Bill for the Amending Act, by reference to the 2020 report of the JSCEM. The attributed purpose of minimising confusion on the part of electors as to the party affiliation of candidates for election is not only compatible with the constitutionally prescribed system of government; it is positively supportive of that system. The purpose, moreover, is the same as the purpose of the pre-existing and continuing provisions for denial of registration and for deregistration in s 129(1)(d) and (da) and in s 134A(1)(a)(i) and (ii) and (2) of the Act respectively. Given the manner in which the attributed purpose is already served by the pre-existing and continuing operation of s 129(1)(d) and (da) and s 134A(1)(a)(i) and (ii) and (2) of the Act, where then is to be found the necessity for deregistration on the objection of an earlier registered political party, and denial of reregistration to a political party without the consent of an earlier registered political party, on the sole basis that its name contains a word already contained in the name of that earlier registered political party? As a matter of logic or linguistics, it simply does not follow from the mere fact that one name contains a word contained in another name that confusion of those names might occur. That point can be starkly illustrated by reference to the word "democratic", which is carved out from the scope of the words covered by s 129(3) and by s 134A(1)(a)(iii) through the operation of s 129(5)(d) working in conjunction with s 129(6). The proposition could not seriously be advanced that electors are likely to confuse the Liberal Democratic Party with the Democratic Labour Party. Moving beyond logic and linguistics to our national experience, Australian political history through the second half of the twentieth century flies in the face of the Democratic Labour Party being confused with the Australian Labor Party by reason only of each of them having a commonly accepted variant of the word "labour" in its name. The JSCEM in its 2020 report, it will be recalled, moved from noting frequent commentary on election results about "how the Labor vote is impaired in some seats where the Democratic Labor [sic] Party is listed higher on the ballot paper, while the Liberal vote can be similarly depressed where the Liberal Democratic Party is listed higher" to a conclusion that election outcomes were being distorted by "duplicative names appearing on the register of political parties" by a process of reasoning that is at best opaque. The Commonwealth seeks to establish a factual foundation for a causal connection between the mere commonality of words appearing in the names of political parties and the likelihood of confusion on the part of electors as to the party affiliation of candidates. Within the parameters of the special case, the Commonwealth does so by focusing on the particular prospect of electors confusing the Liberal Democratic Party with the Liberal Party on the basis of each having the word "Liberal" in its name. The Commonwealth seeks to make that prospect good by relying on a formal admission made by the plaintiff as well as on inferences said to be available to be drawn from material contained in the special case pertaining to the conduct of the 2010, 2013, 2016 and 2019 federal elections. The formal admission on which the Commonwealth relies is in the plaintiff's reply to the defence of the Commonwealth. To understand the significance of the admission, it is necessary to understand the structure of the defence. The defence pleads the compatibility of the impugned Items, both with the core requirement of ss 7 and 24 of the Constitution and with the implied freedom of political communication, by reference to facts and considerations which relevantly include the following: (a) in at least the 2013 and 2016 elections for the Senate, some voters who intended to vote for the Liberal Party instead unintentionally voted for the Liberal Democratic Party because they were confused as to the party affiliation of Liberal Democratic Party candidates; (b) the purpose of the impugned Items is to reduce the risk of electors being confused as to the party affiliation of candidates; (c) the purpose referred to in (b) is consistent with Australia's constitutional system of representative and responsible government because it supports or enhances informed choice by electors of their representatives in the Parliament; (d) the impugned Items are rationally connected to the purpose referred to in (b); and (e) the impugned Items are necessary in the sense that there is no obvious and compelling, reasonably practical, alternative means of achieving the purpose referred to in (b). The reply joins issue with the defence except in relation to the fact pleaded in (a). That fact, says the reply, "the plaintiff admits in relation to the 2013 Senate election". The admission in the reply is therefore that, in the 2013 Senate election, some electors who intended to cast their ballot for the Liberal Party instead unintentionally cast their ballot for the Liberal Democratic Party because they were confused as to the party affiliation of Liberal Democratic Party candidates. Critically missing is any admission that those electors confused the Liberal Democratic Party with the Liberal Party merely on the basis of each of them having the word "Liberal" in the party's name. The material contained in the special case presents a more complex picture. The special case records that the only candidate endorsed by the Liberal Democratic Party who ever won a seat at a federal election is Senator David Leyonhjelm. He was elected as a senator for New South Wales at the 2013 half- Senate election and then re-elected at the 2016 double dissolution election. The special case records Senator Leyonhjelm having made public statements after the 2013 half-Senate election to the effect that "some people" mistook the "Liberal Democrats" for the "Liberals" just as they might also have mistaken the "Liberal Democrats" for the "Christian Democrats" or the "Australian Democrats". Drilling down further into what occurred at the 2013 half-Senate election for New South Wales, the special case quotes the following extract from the JSCEM's Interim report on the inquiry into the conduct of the 2013 Federal Election108: "Concerns have also been raised about the construction of Senate ballot papers and party branding contributing to voter confusion which resulted, most publicly in New South Wales, in votes going to the Liberal Democratic Party rather than the Liberal/Nationals. This in part had to do with the position the party drew on the ballot paper in the first column, together with the size of the ballot paper resulting in the party name 'Liberal' and 'Democrats' being split across two lines, leaving 'Liberal' as the more prominent part of the party name." A copy of the ballot paper for the 2013 half-Senate election for senators for New South Wales described in that interim report of the JSCEM is annexed to these reasons. The registered abbreviation of the Liberal Democratic Party, "Liberal Democrats", appears above the line in column A on the far left, with the word "Liberal" appearing above the word "Democrats". A composite name formed from the registered abbreviations of the Liberal Party and the National Party, "Liberal & Nationals", appears above the line in column Y in about the middle of the ballot paper, with the word and symbol "Liberal &" appearing above the word "Nationals". The relative positions of all political parties on the ballot paper was the product of a randomised system of ballot placement for which provision is made in the Act109. The splitting of "Liberal Democrats" in the printing of the ballot paper so that the word "Liberal" appeared above the word "Democrats" in column A is what is suggested in the quoted extract from the interim report of the JSCEM to have been a practical consequence of the sheer size of the ballot paper. The special case also refers more generally to the phenomenon known colloquially in Australia as the "donkey vote". The phenomenon is known by political scientists as the "ballot order effect" or "ballot position effect". The 108 Australia, Parliament, Joint Standing Committee on Electoral Matters, Interim report on the inquiry into the conduct of the 2013 Federal Election (May 2014) at 2 109 Section 213 of the Act. special case records that, at the 2010, 2013, 2016 and 2019 federal elections, when the Liberal Democratic Party appeared above the line on a Senate ballot paper, it received a higher share of the vote when it drew a position on the ballot paper to the left of the Liberal Party than it did when it drew a position to the right of the Liberal Party. The special case also records that the same was not true of any other party that contested those elections, none of which had the word "Liberal" in its name. The special case also includes a copy of an objection to a political party named "The New Liberals" made to the AEC by the Liberal Party in 2021, annexed to which was a report of market research commissioned by the Liberal Party. The market research report indicated the result of a survey of some 2,000 voters across Australia in March 2021 to be that roughly two thirds of participants thought that the name "The New Liberals" suggested some form of connection with the Liberal Party and said that they would be confused about who to preference if candidates from both the Liberal Party and The New Liberals were to stand in their electorate. The highest that any of the material in the special case rises is to demonstrate that a real issue can from time to time arise as to whether the particular name of some other party which has the word "Liberal" in its name might be confused with the name "Liberal Party". That name-specific risk of confusion is a risk of the very sort that the pre-existing and continuing provisions – ss 129(1)(d) and (da) and 134A(1)(a)(i) and (ii) and (2) of the Act – are peculiarly adapted to redress. On any objection by the Liberal Party to the continuing registration of the Liberal Democratic Party in reliance on s 134A(1)(a)(i) and (ii) and (2) of the Act, the AEC and the AAT, on any application for review of a decision of the AEC, would need to determine whether there exists a meaningful risk of an elector preparing to vote by marking the ballot paper at an election confusing the particular name "Liberal Party" with the particular name "Liberal Democratic Party". That is an issue which the AEC determined in the negative in 2008 in a decision which the AEC affirmed on internal review, and from which the Liberal Party did not appeal to the AAT. It is not an issue which now needs to be determined by this Court in order to answer the questions raised in the special case, and it is not an issue which could be determined solely on the material contained in the special case. What the material in the special case fails to demonstrate is that the mere fact that one political party contains in its registered name a word contained in the registered name of another, earlier registered political party is alone enough to support the conclusion that there exists a meaningful risk of confusion on the part of electors as to the party affiliation of candidates for election to the Senate or to the House of Representatives. No necessity for the impugned Items has therefore been demonstrated to exist, much less a necessity which can be characterised as rising to the level of a compelling justification. Formal answers to questions Four questions are formally stated in the special case for the opinion of the Full Court. The first and second ask whether any of Items 7, 9, 11 and 14 of Sch 1 to the Amending Act is in whole or in part invalid on the ground that it infringes the implied freedom of political communication or on the ground that it precludes direct choice by the people of senators and members of the House of Representatives contrary to ss 7 and 24 of the Constitution. The answer to each question is that each impugned Item is wholly invalid on the ground identified in the question. The third question asks what, if any, relief should issue. The answer is that a declaration should be made reflecting the answers to the first two questions. The final question asks who should pay the costs of and incidental to the special case. The answer is the defendant. GORDON, EDELMAN AND GLEESON JJ. Introduction In 2021, after a series of amendments over many years to the Commonwealth Electoral Act 1918 (Cth) designed to reduce voter confusion at federal elections, the Commonwealth Parliament enacted items 7, 9, 11 and 14 of Sch 1 to the Electoral Legislation Amendment (Party Registration Integrity) Act 2021 (Cth) ("the 2021 Amendments"). In broad terms, those amendments constrain a registered political party from using a name or logo on the election ballot paper if that name or logo has a word in common with the name of a previously registered political party. The purpose of the 2021 Amendments is plain. It is to reduce confusion. In the 2013 federal election, the Liberal Democratic Party appeared first, and substantially to the left-hand side of the parties described collectively as the "Liberal & Nationals", on the New South Wales Senate ballot paper. In the estimation of the Liberal Democratic Party Senate candidate David Leyonhjelm, who was elected on that occasion, more than half of the votes received by the Liberal Democratic Party, being up to 5.5 per cent of all votes in the 2013 New South Wales Senate election, may have been the result of confusion with electors voting, by mistake, for the Liberal Democratic Party instead of the Liberal & Nationals. On that analysis, almost 241,000 votes were miscast. Two days after the election, Senator Leyonhjelm said that "you can't deny that some people would have ... mistaken us for the Liberals", and accepted that it was "possible" that confusion could have contributed 75 per cent of the votes for the Liberal Democratic Party. This case, as presented and argued, was particularly concerned with the application of the 2021 Amendments to the Liberal Democratic Party. If applied to the Liberal Democratic Party to preclude the use of its name on the ballot paper for a federal election, they would not prevent the party being registered under an alternative name, so that candidates could be identified on the ballot paper as affiliated with the same party bearing that alternative name. Alternatives conveying a similar view point include the party's previous name, the "Liberty and Democracy Party", or the name which the party has recently sought to register, the "Liberty & Democracy Party". The 2021 Amendments would not prevent the Liberal Democratic Party from campaigning, advertising, or communicating in any way under the name "Liberal Democratic Party". They would not prevent the Liberal Democratic Party from handing out "how to vote" cards with details of candidates endorsed by the Liberal Democratic Party, if it wished to continue to campaign under that name. They would not prevent endorsed candidates of the party from being identified on the ballot paper with the logo and initialism of "LDP". In this special case, Mr Ruddick, the lead Senate candidate endorsed by the Liberal Democratic Party for New South Wales, challenged the validity of the 2021 Amendments. He claims that the 2021 Amendments are contrary to the requirements in ss 7 and 24 of the Constitution that candidates for election be "directly chosen by the people" and, further or alternatively, that the 2021 Amendments contravene the implied freedom of political communication. Neither claim can succeed. Both fail at the threshold. None of the material in the special case demonstrates that the 2021 Amendments impair or burden the quality of any electoral choice by the people or the freedom of political communication. The Constitution does not confer upon political parties a licence to obtain votes by confusion. "[T]he ballot, being a means of protecting the franchise, should not be made an instrument to defeat it"110. The 2021 amendments to the Commonwealth Electoral Act The law from 1984 Historically, ballot papers for federal elections did not include any party endorsement with the names of candidates111. That changed when, in 1983112, a scheme was introduced for the registration of political parties which permitted registered parties to have their name (or, later, a registered abbreviation of it)113, and eventually their party logo114, printed on the ballot paper next to the name of a candidate endorsed by the party. The 1983 amendments permitted registration of a political party only in certain circumstances, which included compliance with provisions designed to avoid confusion of parties by electors115. The provisions included a first-in-time priority to registered parties and Parliamentary parties which prevented 110 Langer v The Commonwealth (1996) 186 CLR 302 at 347. 111 Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 213 [78]. 112 Commonwealth Electoral Legislation Amendment Act 1983 (Cth). 113 Commonwealth Electoral Act 1918 (Cth), ss 210A, 214. 114 Commonwealth Electoral Amendment Act 2016 (Cth); Commonwealth Electoral Act 1918 (Cth), s 214A. 115 Commonwealth Electoral Act 1918 (Cth), s 58G, now s 129. registration of any subsequent party with a name or abbreviation that: (i) "is the name, or is an abbreviation or acronym of the name", of the prior registered party or Parliamentary party; or (ii) "so nearly resembles the name, or an abbreviation or acronym of the name" of the prior registered party or Parliamentary party that it was likely to be confused with or mistaken for the prior registered party or Parliamentary party. In 2004, further amendments were made to the Commonwealth Electoral Act in order to address continuing confusion116. Section 129(1)(da) was introduced to prevent registration of a political party if, in the opinion of the Electoral Commission, the proposed name of the party "is one that a reasonable person would think suggests that a connection or relationship exists between the party and a registered party if that connection or relationship does not in fact exist". But even with these further amendments, Parliament considered there was still a likelihood of significant confusion. In 2005, the Joint Standing Committee on Electoral Matters observed that "[c]onfusion still arises, however, because parties that registered names prior to the 2004 amendments are still permitted to use those names"117. The Committee quoted a submission of the Liberal Party that the party name "liberals for forests" is "potentially confusing and can mislead voters into believing that liberals for forests has some connection to the Liberal Party or gives its preferences to the Liberal Party"118. The confusion at the 2013 federal election The confusion provisions failed to prevent significant confusion in voting in 2013. With Mr Leyonhjelm as its lead candidate, the Liberal Democratic Party received 415,901 votes (9.5 per cent of the votes) for the Senate election for New South Wales. In the 2013 election, the ballot paper for the Senate in New South Wales listed the "Liberal Democrats" in the first column and the Liberal Party and the 116 Electoral and Referendum Amendment (Enrolment Integrity and Other Measures) Act 2004 (Cth). 117 Joint Standing Committee on Electoral Matters, Report of the Inquiry into the Conduct of the 2004 Federal Election and Matters Related Thereto (2005) at 95 118 Joint Standing Committee on Electoral Matters, Report of the Inquiry into the Conduct of the 2004 Federal Election and Matters Related Thereto (2005) at 96 National Party, grouped together as the "Liberal & Nationals", in the 25th column. Although there was an average swing in favour of the Liberal Party and the National Party of 0.68 per cent and 2.06 per cent respectively across the House of Representatives seats in New South Wales and an overall swing of 3.61 per cent in the two-party preferred vote, in the Senate election for New South Wales there was a swing of 4.75 per cent against the Liberal Party and the National Party. interview In a radio two days after the 2013 federal election, Senator Leyonhjelm said that the Liberal Democratic Party had initially expected a vote of about 2.5 to 3 per cent, which rose to about 4 per cent as a result of "donkey" votes due to the party's first position on the ballot paper. That view is consistent with a careful academic analysis that estimated that the benefit of being placed first on a ballot paper was, on average, a 1 per cent increase in a candidate's vote share119. Senator Leyonhjelm referred to the 9.5 per cent of votes received and added that "you can't deny that some people would have ... mistaken us for the Liberals", although he speculated that the confusion might also have been with the Christian Democrats or the Australian Democrats. He accepted that it was possible that confusion could have contributed 75 per cent of the Liberal Democratic Party votes. In an interim report on the inquiry into the conduct of the 2013 federal election, the Joint Standing Committee on Electoral Matters referred to concerns about "voter confusion", particularly in New South Wales, with "votes going to the Liberal Democratic Party rather than the Liberal/Nationals"120. The Committee observed that part of the reason may have been the position of the Liberal Democratic Party in the first column on the ballot paper combined with the format of the ballot paper, with "Liberal" as the more prominent part of the name on the line above "Democrats". It is also open to conclude that confusion was caused by the presence of similar names beyond any independent effect of ballot paper position. That statement needs explanation by reference to the facts stated in the special case. The correlation between the Liberal Democratic Party's position on the ballot paper and its increased share of the vote was not identified in respect of any 119 King and Leigh, "Are Ballot Order Effects Heterogeneous?" (2009) 90 Social Science Quarterly 71. 120 Joint Standing Committee on Electoral Matters, Interim report on the inquiry into the conduct of the 2013 Federal Election: Senate voting practices (2014) at 2 other party that contested the 2010, 2013, 2016 and 2019 elections. In the 2013 election, the Liberal Democratic Party was placed in the first position on the ballot paper, and significantly to the left of the Liberal Party. The Liberal Democratic Party received 9.5 per cent of the vote in that election. That contrasts with the party's results in the 2010, 2016 and 2019 elections, where it received 2.31 per cent, 3.09 per cent and 1.91 per cent of the vote respectively. That is, in the 2013 election, the Liberal Democratic Party received approximately three times the share of the vote that it received in its next best election. By contrast, the share of the vote received by other minor parties who drew the first position on the New South Wales Senate ballot paper in 2010, 2016 and 2019 was between 0.56 per cent and 1.18 per cent of the vote – far less than the 9.5 per cent that the Liberal Democratic Party received. In its 2020 report, the Joint Standing Committee on Electoral Matters referred to the combination of the ballot position of the Liberal Democratic Party and the Democratic Labor Party121 and their use of "Liberal" and "Labor" as affecting the vote by a few percentage points, as voters had been misled122. Although it is not possible to identify and then disaggregate all possible factors that might have contributed to the 9.5 per cent vote that the Liberal Democratic Party received, it is an available inference from those facts and matters, together with Mr Ruddick's admissions on the pleadings and in the agreed facts as to confusion in fact caused by the word "Liberal" in the party name, that the confusion caused by the similar name was responsible for a significant part of the increase in that vote. Further legislative responses to avoid confusion The Joint Standing Committee on Electoral Matters produced a further report in 2016 concerning the introduction of logos on ballot papers for reasons including assisting voters "to clearly locate their intended vote on the ballot 121 The spelling of the registered name of the Democratic Labour Party was changed from "Labor" to "Labour" in 2013. 122 Joint Standing Committee on Electoral Matters, Report on the conduct of the 2019 federal election and matters related thereto (2020) at 144 [7.41]-[7.42]. paper"123. Those suggestions resulted in further amendments to the Commonwealth Electoral Act to permit the use of logos on ballot papers124. In December 2020, the Joint Standing Committee on Electoral Matters published a report on the conduct of the 2019 election. After consideration of the need to distinguish "party name registrations" because "voter choices and election outcomes should not be distorted by duplicative names", the Committee recommended that "section 129 of the Commonwealth Electoral Act 1918 should be amended to permit the Electoral Commissioner to remove a name or a part of a name from an existing or proposed party that replicates a key word or words in the name of another recognised party that was first established at an earlier time"125. This recommendation was the impetus for the 2021 Amendments. The 2021 amendments Parliament responded to the recommendation of the Committee by introducing the 2021 Amendments. The explanatory memorandum to the 2021 Amendments explained that the purpose of the amendments was to avoid confusion and to enhance the informed choice of voters: "[w]here overlap of names causes voters to mistake one party for another, it can distort their choices, in some cases by attracting a voter mistakenly to a party they did not intend to support and in other cases deterring them from supporting a party that they might otherwise give consideration to"126. The explanatory memorandum also observed that exceptions were provided for "non-key words" and that "[t]he Macquarie Dictionary of Australia currently recognises over 138,000 distinctive headwords and phrases, almost all of which can be used for party names and allow parties to communicate their distinctive characteristics to the public"127. 123 Joint Standing Committee on Electoral Matters, Advisory Report on the Commonwealth Electoral Amendment Bill 2016 (2016) at 27 [3.45]. 124 Commonwealth Electoral Amendment Act 2016 (Cth); Commonwealth Electoral Act 1918 (Cth), s 214A. 125 Joint Standing Committee on Electoral Matters, Report on the conduct of the 2019 federal election and matters related thereto (2020) at 144 [7.41]-[7.45]. 126 Australia, House of Representatives, Electoral Legislation Amendment (Party Registration Integrity) Bill 2021, Explanatory Memorandum at 5 [14]. 127 Australia, House of Representatives, Electoral Legislation Amendment (Party Registration Integrity) Bill 2021, Explanatory Memorandum at 9 [19]. The impugned provisions have two central effects. First, items 7 and 9 impose an additional requirement for registration of a new party, and hence for a party name (or abbreviated name) and logo to appear with the name of an endorsed candidate on the ballot paper. The additional requirement, contained in ss 129(3), 129(6) and 129A(2), is that the name, abbreviation or logo of an applicant party must not, without the consent of the prior registered political party, contain a word that is in the name, or the abbreviation of the name, of the prior registered political party. Secondly, by items 11 and 14, introducing ss 134A(1)(a)(iii) and 134A(1A), an existing party cannot remain registered under its name if an earlier registered party objects to the existing party's name or logo and that name or logo contains a word that is in the name, or the abbreviation of the name, of the prior registered political party. In each case, there are exceptions for the repetition in a party name of a function word, a collective noun for people, the name of a country, the word "country", a recognised geographical place in Australia, and the word "democratic"128. There is also a separate expansion of the operation of the provisions so that they extend not merely to the same word in the name or abbreviation of an earlier registered party, but also to grammatical forms and commonly accepted variants (including abbreviations, contractions, and alternative forms) of the word129. The reference to grammatical forms of the word is to the grammatical concept of inflections of the word but not to derivatives of the word130. Inflections (or inflectional forms) arise from the application of morphological rules to a common lexical base and have been described as "different forms of the same word"131. For instance, most nouns inflect for number and case (eg including liberal, liberals, liberal's). By contrast, derivatives are new words formed by adding to an existing lexical base (eg liberal, liberalism, liberality)132. 128 Commonwealth Electoral Act 1918 (Cth), s 129(5). 129 Commonwealth Electoral Act 1918 (Cth), s 129(6). 130 Greenbaum, The Oxford English Grammar (1996) at 470. 131 Huddleston and Pullum, The Cambridge Grammar of the English Language (2002) at 27. See also at 1567-1570. 132 Huddleston and Pullum, The Cambridge Grammar of the English Language (2002) Legitimacy of the purpose of the 2021 amendments As explained above, the history and sequence of amendments to the Commonwealth Electoral Act has been one of evolving legislative responses to minimise confusion. Each of the reports of the Joint Standing Committee on Electoral Matters identified a need to respond to voter confusion. It was against that background that the 2021 Amendments were enacted. The Assistant Minister began the second reading speech of the Electoral Legislation Amendment (Party Registration Integrity) Bill 2021 (Cth) by identifying that the purpose of the impugned provisions was to "reduce the risk of voter confusion". He added that the Bill "responds to reports of the Joint Standing Committee on Electoral Matters", concluding that "these provisions will enhance the integrity of the electoral process by reducing the likelihood of voters inadvertently associating or confusing political parties with similar-sounding names"133. Mr Ruddick submitted, however, that the purpose of the 2021 Amendments was illegitimate. Parliament cannot enact legislation for a purpose or design that is inconsistent with the Constitution134. Mr Ruddick submitted that the purpose of the 2021 Amendments was inconsistent with ss 7 and 24 of the Constitution and the implied freedom of political communication because it was "anti-competitive" in the sense that, despite references in the extrinsic materials to a purpose of avoiding confusion, the "real mischief" and the "true purpose" of the provisions is to reduce competition between major parties and minor parties. Mr Ruddick pointed to paras 7.41 to 7.44 in the 2020 Joint Standing Committee on Electoral Matters report, which made a number of references to major parties and minor parties. Mr Ruddick's submission was essentially that the purpose of the 2021 Amendments expressed in the explanatory memorandum and in the second reading speech was a sham. It can be accepted that statements of purpose in an explanatory memorandum or a second reading speech are not conclusive, but it is a significant step to conclude that express statements in such extrinsic materials are a pretence designed to conceal an anti-competitive purpose. The identification of a legislative purpose involves "ordinary processes of interpretation, including considering the meanings of statutory words in the 133 Australia, House of Representatives, Parliamentary Debates (Hansard), 12 August 134 McCloy v New South Wales (2015) 257 CLR 178 at 203 [31]; Clubb v Edwards (2019) 267 CLR 171 at 194 [44]. provision, meanings of other provisions in the statute, the historical background to the provision, and any apparent social objective"135. Here, all of these matters support the expressed concern in the explanatory memorandum and second reading speech of reducing voter confusion. The concern of ss 129, 129A and 134A, read as a whole, is with voter confusion. The historical background, and the Commonwealth Electoral Act read as a whole136, reveals an "inferred legislative imperative"137 to avoid confusion. In those circumstances, the Court should not lightly infer an unexpressed and constitutionally impermissible purpose138. Even the statements of the Joint Standing Committee on Electoral Matters to which Mr Ruddick refers do not support any other purpose. The relevant paragraphs precede the Committee's recommendation for the amendment of s 129 of the Commonwealth Electoral Act. Relevantly, after referring to frequent election commentary "about how the Labor vote is impaired in some seats where the Democratic Labor Party is listed higher on the ballot paper, while the Liberal vote can be similarly depressed where the Liberal Democratic Party is listed higher", the Committee explained its conclusion as having the purpose of avoiding confusion139: "The Committee considers that voter choices and election outcomes should not be distorted by duplicative names appearing on the register of political parties. Indeed the two instances referred above involve minor parties copying names of major parties, presumably for purposes of appealing to part of the same voter base." And, as has been explained and as the Committee recognised, confusion occurred independently of the order of the parties on the ballot paper. 135 Unions NSW v New South Wales (2019) 264 CLR 595 at 657 [171] (footnotes omitted). 136 Acts Interpretation Act 1901 (Cth), s 11B. See also Commissioner of Stamps (SA) v Telegraph Investment Co Pty Ltd (1995) 184 CLR 453 at 463; Plaintiff S297/2013 v Minister for Immigration and Border Protection (2014) 255 CLR 179 at 186 [25]. 137 Spence v Queensland (2019) 268 CLR 355 at 417 [96], quoting McCloy v New South Wales (2015) 257 CLR 178 at 262 [233]. 138 cf Unions NSW v New South Wales (2019) 264 CLR 595 at 627 [79]. 139 Joint Standing Committee on Electoral Matters, Report on the conduct of the 2019 federal election and matters related thereto (2020) at 144 [7.43]. The Liberal Democratic Party and the objection under s 134A On 7 September 2007, a party was registered under the Commonwealth Electoral Act as the "Liberty and Democracy Party", with the abbreviation "LDP". The Liberty and Democracy Party contested the 2007 federal election under that name, endorsing 47 candidates for the House of Representatives and 14 candidates for the Senate. The Liberty and Democracy Party changed its name to the Liberal Democratic Party, registering that name under the Commonwealth Electoral Act on 17 December 2008. The Liberal Democratic Party contested the federal elections in 2010, 2013, 2016, and 2019. The only one of its endorsed candidates to win a seat was Senator Leyonhjelm in the circumstances described above in these reasons. On 9 November 2021, the Federal Director of the Liberal Party of Australia made an objection to the Australian Electoral Commission, under s 134A of the Commonwealth Electoral Act, to the continued use of the name "Liberal Democratic Party" and the abbreviation "Liberal Democrats". How this proceeding was run In his statement of claim in this Court, Mr Ruddick pleaded that the 2021 Amendments were invalid for two reasons. First, in an apparent reference to s 7 of the Constitution, Mr Ruddick pleaded that the impugned provisions were inconsistent with the constitutional requirement of representative government "which requires Senators to be directly chosen by the people". Secondly, Mr Ruddick pleaded that the impugned provisions burdened communication on government or political matters and were contrary to the implied freedom of political communication in the Constitution. In relation to both pleaded reasons for invalidity, Mr Ruddick focused upon the asserted importance of a political party's name on the ballot paper as a means of electoral communication, including by reference to a recognised political tradition like "liberalism". Mr Ruddick asserted that the impugned provisions vest property in party names and political traditions in incumbent parties. The "specific burden" Mr Ruddick focused upon was the consequences of the objection by the Liberal Party, namely that if the Liberal Democratic Party is deregistered, his name would not be associated with his political party, which has "twenty years of reputational capital", on the ballot paper. In light of the obvious confusion between the "Liberal & Nationals" and the "Liberal Democrats", Mr Ruddick admitted in his pleadings that in the 2013 election for the Senate, "some voters who intended to vote for the Liberal Party instead unintentionally voted for the Liberal Democratic Party because they were confused as to the party affiliation of Liberal Democratic Party candidates". The most likely cause of that confusion was the inclusion of the word "Liberal" in the party name. The special case that was agreed focused almost exclusively on the circumstances of the Liberal Democratic Party and the effect of the 2021 Amendments precluding the use of the word "Liberal" on the ballot paper to describe the party affiliation of a candidate of any registered political party other than the Liberal Party. This was not merely because Mr Ruddick's interests are most directly affected by the inability to use the word "Liberal". It was also because the evidence that the 2021 Amendments could affect the use of any other word by an existing political party, whether registered or not, was sparse. It will be recalled that the 2021 Amendments do not extend to: a function word (such as "the"); the word "democratic"; the word "country" or a name of a country, such as "Australia"; or a collective noun for people, such as "party", "network" or "team". And, as will be explained below, the 2021 Amendments do not extend to derivatives of the same word or even to variants of the same word unless that word is commonly accepted in Australia as a variant. As to existing registered political parties that might be affected by the 2021 Amendments, the special case mentioned only the Democratic Labour Party. The special case referred to statistics from which it might, albeit perhaps with more statistical information than was provided, be open to infer that, on average, up to 1.1 per cent of the vote for the Democratic Labour Party in above-the-line State and federal elections was due to voters confusing that party with the Australian Labor Party. But nothing more was said about the Democratic Labour Party, including whether even a single voter might not be sufficiently informed to vote for a candidate if that party were required to register its name, and be named on the ballot, by an alternative such as "Democratic Labouring Party" or "Democratic Labourers Party". Indeed, in oral submissions in this Court, when reference was made to the application of the word "labor" to existing parties affected by the 2021 Amendments, senior counsel for Mr Ruddick said that it raised "concerns" which are "otherwise irrelevant to this case". The Solicitor-General of the Commonwealth referred to material outside the special case, published on the website of the Australian Electoral Commission, concerning a notice to deregister the Democratic Labour Party dated 27 January 2022 based on non-satisfaction of the requirement that a party have at least 1,500 members. Unless that requirement is satisfied, the Democratic Labour Party is liable to be deregistered irrespective of the operation of the 2021 Amendments. There is a further difficulty that arises from the manner in which this special case was presented. Although Mr Ruddick has standing, that does not mean he is permitted to "roam at large" over the impugned provisions or to advance grounds of challenge other than those which bear on the validity of the impugned provisions in their application to him140. More particularly, he is confined by the factual basis he agreed to in the special case141 supplemented by evidence of recent applications by the Liberal Democratic Party to change its registered party name and logo. Relevantly, the proposed name change is to the "Liberty & Democracy Party". The Australian Electoral Commission is required to deal with these applications in accordance with Pt XI142. With the exception of incidental references in quoted or annexed materials, none of the facts stated in the special case expressly refer to or address items 7 or 9 of Sch 1 to the 2021 Amendments. And it is not possible to draw any inference from the facts stated in the special case as to the potential engagement of those items. Mr Ruddick has not merely failed to establish that "there exists a state of facts which makes it necessary to decide [the validity of items 7 and 9] in order to do justice in the ... case and to determine the rights of the parties"143, which would invite the application of prudential considerations144 to whether the Court should determine the constitutional validity of those items. Mr Ruddick has failed to put before this Court any facts against which the validity of items 7 and 9 can be tested. If the validity of items 11 and 14 of Sch 1 to the 2021 Amendments is upheld, there can be no warrant for this Court to attempt to consider "an abstract or hypothetical 140 The Real Estate Institute of NSW v Blair (1946) 73 CLR 213 at 227; Knight v Victoria (2017) 261 CLR 306 at 324-325 [33]. 141 Mineralogy Pty Ltd v Western Australia (2021) 95 ALJR 832 at 846 [56]; 393 ALR 142 Commonwealth Electoral Act 1918 (Cth), s 134. 143 Lambert v Weichelt (1954) 28 ALJ 282 at 283. 144 See Lambert v Weichelt (1954) 28 ALJ 282 at 283; Tajjour v New South Wales (2014) 254 CLR 508 at 588-589 [174]-[176]; Knight v Victoria (2017) 261 CLR 306 at 324-325 [32]-[33], 326 [36]-[37]; Clubb v Edwards (2019) 267 CLR 171 at Zhang v Commissioner of Australian Federal Police (2021) 95 ALJR 432 at 437-438 [21]-[23]; 389 ALR 363 at 368-369; Mineralogy Pty Ltd v Western Australia (2021) 95 ALJR 832 at 846-847 [56]-[60], 852-854 [100]-[107]; 393 ALR question outside the scope of the suit"145 by considering items 7 and 9, about which there were neither agreed facts involving any application to Mr Ruddick or the Liberal Democratic Party nor any argument about their application. Threshold issues for the constraints upon legislative power The constraint deriving from ss 7 and 24 of the Constitution Sections 7 and 24 of the Constitution require that the senators for each State and the members of the House of Representatives shall be "directly chosen by the people", meaning the people of the State and the people of the Commonwealth respectively. The phrase "directly chosen by the people" contains, by explicature from the requirement of direct choice, implied constraints upon legislative power. The requirement of direct choice by the people does not bear its literal meaning146. As McTiernan and Jacobs JJ said in Attorney-General (Cth); Ex rel McKinlay v The Commonwealth147, a literal meaning would require a unanimous choice by all people, including children. But, as they explained, nor do the words "directly chosen by the people" mean nothing more than a choice by a direct vote of those people whom Parliament recognises as electors. By implication from the expressed words in their context148, the sections say "much more than this"149. The decisions of this Court in Roach v Electoral Commissioner150, Rowe v Electoral Commissioner151, and Murphy v Electoral Commissioner152 recognised that one requirement of direct choice by the people in ss 7 and 24 is that the 145 British Medical Association v The Commonwealth (1949) 79 CLR 201 at 258. 146 Langer v The Commonwealth (1996) 186 CLR 302 at 342. 147 (1975) 135 CLR 1 at 35-36. 148 See McGinty v Western Australia (1996) 186 CLR 140 at 170. 149 Attorney-General (Cth); Ex rel McKinlay v The Commonwealth (1975) 135 CLR 1 150 (2007) 233 CLR 162. 151 (2010) 243 CLR 1. 152 (2016) 261 CLR 28. reference to "the people" restricts the extent to which Parliament can burden or reduce the universal adult franchise. Provided that the threshold issue of a burden upon the franchise is established, Parliament will only be justified in imposing that burden if it does so for a substantial reason, being a reason which is "reasonably appropriate and adapted to serve an end which is consistent or compatible with the maintenance of the constitutionally prescribed system of representative government"153. What a court will accept as a substantial reason will vary over time, including with changing social conditions. For instance, whether or not they could ever have been justified154, there could not be any justification for the laws that existed in all States except South Australia155 and Western Australia156 that denied the vote at the first Commonwealth election to women157, or the laws in Queensland and Western Australia that banned Aboriginal people from the electoral roll158. In the assessment of whether a substantial reason exists to justify imposing a burden on the franchise, it must be borne in mind that the requirement of "direct choice by the people" was intended only as a basic structural requirement, or the "bare foundations of the electoral law"159. This deliberate design of the Constitution included leaving Parliament with a wide leeway of choice, even concerning the fundamental features of the operation of elections160. As Reid and 153 Roach v Electoral Commissioner (2007) 233 CLR 162 at 199 [85]. 154 See Attorney-General (Cth); Ex rel McKinlay v The Commonwealth (1975) 135 CLR 1 at 69; McGinty v Western Australia (1996) 186 CLR 140 at 221-222. 155 Constitution Amendment Act 1894 (SA). 156 Constitution Acts Amendment Act 1899 (WA). 157 New South Wales Constitution Act 1855 (Imp) (18 & 19 Vict c 54), Sch 1, s 11; Victoria Constitution Act 1855 (Imp) (18 & 19 Vict c 55), Sch 1, s 5. 158 Reid and Forrest, Australia's Commonwealth Parliament 1901-1988 (1989) at 95. 159 Reid and Forrest, Australia's Commonwealth Parliament 1901-1988 (1989) at 86. See also Rowe v Electoral Commissioner (2010) 243 CLR 1 at 121 [386]. 160 Murphy v Electoral Commissioner (2016) 261 CLR 28 at 113-114 [263]-[264], citing Official Report of the National Australasian Convention Debates (Adelaide), 15 April 1897 at 672-675; Official Record of the Debates of the Australasian Federal Convention (Melbourne), 16 March 1898 at 2445-2446. See also McGinty v Western Australia (1996) 186 CLR 140 at 183-184, 279-280; Mulholland v Forrest observed, "[t]he architects of the Constitution placed great faith in the capacity of the elected senators and members to design statute law for a system of representative self-government, notwithstanding that they would be legislating in their own interest"161. For the same reasons, an overly broad approach restraining Parliament's leeway of choice should not be taken in determining the threshold issue, namely, whether the plaintiff can establish that there has been some burden imposed upon the franchise. For instance, in Murphy v Electoral Commissioner162, four members of this Court held that there was no burden on the franchise by provisions of the Commonwealth Electoral Act which suspended enrolments, transfers of enrolment and other changes to the electoral rolls from 8 pm on the seventh day after the date of the writ of the election until after the close of the poll for the election163. The plaintiffs' submission that there was a burden on the franchise involved impermissibly isolating one aspect of the voting system (the suspension period) and considering it separately from the remainder of the system164. As French CJ and Bell J said, "[t]he impugned provisions do not become invalid because it is possible to identify alternative measures that may extend opportunities for enrolment"165. This special case concerns a different dimension of the requirement in ss 7 and 24 of "direct choice by the people" but a dimension to which the same general principles should apply. Mr Ruddick focused upon the requirement that the senators for each State be "chosen", which is distinct from a requirement that they be "elected". The notion of "choice" is broader than "elected" because "choice" connotes a requirement of quality of information, just as the concept of "the people" is broader than merely "the electors". The constraint implied by the Australian Electoral Commission (2004) 220 CLR 181 at 188 [6], 207 [64], 236-237 [154]; Rowe v Electoral Commissioner (2010) 243 CLR 1 at 22 [29], 49-50 [125], 161 Reid and Forrest, Australia's Commonwealth Parliament 1901-1988 (1989) at 87, cited in McGinty v Western Australia (1996) 186 CLR 140 at 279-280. 162 (2016) 261 CLR 28. 163 (2016) 261 CLR 28 at 55 [42], 88 [181], 125 [308]. 164 (2016) 261 CLR 28 at 128 [321]. 165 (2016) 261 CLR 28 at 55 [42]. requirement of choice is that the people must have the ability to make an informed choice, which restricts Parliament's ability to constrain the extent to which the people can "convey and receive opinions, arguments and information concerning matter intended or likely to affect voting"166. The Commonwealth's submission that there is a distinction – a dichotomy – between a law that imposes an impediment to universal adult suffrage and laws that regulate the electoral system without excluding any electors from the franchise is inapposite167. Like the restriction implied by the notion of "the people", the restriction implied by the requirement of "choice" in ss 7 and 24 must not be applied in an over-broad manner which would fail to respect the constitutional design of leaving to Parliament the choice of how to legislate for every aspect, except the bare foundations, of the electoral system. It can be accepted that the implied constitutional mandate that the choice be informed168 takes the meaning of ss 7 and 24 further than the "common parlance" of "to choose", which "means no more than to make a selection between different things or alternatives submitted, to take by preference out of all that are available"169. An example where care was taken not to apply the constraints of ss 7 and 24 in an overly broad manner is the decision in Langer v The Commonwealth170. In that case, five members of this Court upheld the validity of an amendment to the Commonwealth Electoral Act which prohibited the printing, publication, or distribution of material that encouraged people to vote at an election in a way that would be informal. The provision was valid, even though it deprived electors of information that would assist them to vote, in a lawful manner, so as to deny their preferences going to a candidate for whom they did not want to vote. 166 Australian Capital Television Pty Ltd v The Commonwealth (1992) 177 CLR 106 at 232. See also at 228. 167 McGinty v Western Australia (1996) 186 CLR 140 at 220. 168 Murphy v Electoral Commissioner (2016) 261 CLR 28 at 88-89 [184]. 169 Judd v McKeon (1926) 38 CLR 380 at 383. 170 (1996) 186 CLR 302. The broader freedom of political communication constraint In Lange v Australian Broadcasting Corporation171, this Court recognised an implied freedom of political communication as a separate and broader restriction upon legislative power. This implied freedom was based not merely upon ss 7 and 24 but also upon the structure of the Constitution and provisions such as ss 64 and 128172, each of which "give rise to implications of their own"173. Provided that a law has a legitimate purpose, a threshold issue for determining the validity of any law alleged to infringe the implied freedom of political communication is whether the law effectively burdens freedom of communication about government or political matters either in its terms, operation, or effect174. Since the implication is "an implication of freedom under the law of an ordered society"175, any burden upon the freedom of political communication must be measured against the valid, existing laws which form a "constitutionally valid baseline"176. Proof that the law imposes a burden requires that the existing freedom is curtailed or restricted in some way. In Levy v Victoria177, McHugh J made the same point about the measurement of a burden against existing, valid laws, saying that the implied freedom "gives immunity from the operation of laws that inhibit [an existing] right or privilege to communicate political and government matters ... [T]hat right or privilege must exist under the general law." 171 (1997) 189 CLR 520. 172 (1997) 189 CLR 520 at 567. 173 (1997) 189 CLR 520 at 561. 174 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 567. 175 Cunliffe v The Commonwealth (1994) 182 CLR 272 at 337. 176 Brown v Tasmania (2017) 261 CLR 328 at 443 [357]. See also at 365 [109], 408 177 (1997) 189 CLR 579 at 622. See also Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 222 [102], 223-224 [107]-[108], 246 [184], 298 The same point was reiterated in Brown v Tasmania178. In the joint judgment of Kiefel CJ, Bell and Keane JJ, their Honours said that it was "logical to approach the burden which a statute has on the freedom by reference to what [persons] could do were it not for the statute"179. Nettle J said that the freedom is only a "freedom to communicate by lawful means"180. Gordon J said that "[t]o the extent that the impugned law is congruent with the existing law, it is any incremental burden that needs justification"181. And Edelman J said that there can be no burden on the freedom if "the conduct about which legislation is concerned is independently unlawful, so that there was no legal freedom to communicate about government or political matters"182. The position in the United States This Court has repeatedly cautioned against reliance upon United States authorities concerning the Bill of Rights183. In the United States, the type of issue that arises in this case would concern express, individual rights under the First and Fourteenth Amendments to the United States Constitution, rather than implied constraints upon legislative power. Yet, as Gummow and Hayne JJ demonstrated by their review of United States authorities in Mulholland v Australian Electoral Commission184, even with the express guarantees of the First and Fourteenth Amendments, the United States courts have, in the words of Professor Tribe, accommodated "the fear of a temporary majority entrenching itself with the 178 (2017) 261 CLR 328. 179 (2017) 261 CLR 328 at 365 [109]. 180 (2017) 261 CLR 328 at 408 [259]. 181 (2017) 261 CLR 328 at 456 [397]. 182 (2017) 261 CLR 328 at 502-503 [557]. 183 Theophanous v Herald & Weekly Times Ltd (1994) 182 CLR 104 at 125; McGinty v Western Australia (1996) 186 CLR 140 at 187, 202-203; Levy v Victoria (1997) 189 CLR 579 at 594; Coleman v Power (2004) 220 CLR 1 at 48 [88], 75-76 [187]-[188]; Monis v The Queen (2013) 249 CLR 92 at 207 [326]; McCloy v New South Wales (2015) 257 CLR 178 at 202 [29], 258 [219]; Brown v Tasmania (2017) 261 CLR 328 at 475 [465]-[466]; Clubb v Edwards (2019) 267 CLR 171 at 345-349 184 (2004) 220 CLR 181 at 240-242 [165]-[169]. necessity of making the election a readable barometer of the electorate's preferences"185. the democratic process at The Supreme Court of the United States has repeatedly said that "[t]here is surely an important state interest in ... avoiding confusion, deception, and even the general election"186. As frustration of Professor Douglas has observed, in the application of that important State interest a distinction should be drawn between, on the one hand, laws that affect candidates, such as restricting their ability to run for office or their position or description on a ballot paper, and, on the other hand, laws that affect voters in their ability to choose between candidates187. As Rehnquist CJ said in Timmons v Twin Cities Area New Party188, in a judgment with which five other members of the Supreme Court joined, the Supreme Court of the United States has "repeatedly upheld reasonable, politically neutral regulations that have the effect of channeling expressive activit[ies] at the polls". In that case, the Supreme Court reiterated its rejection of the proposition that a party "has a right to use the ballot itself to send a particularized message, to its candidate and to the voters, about the nature of its support for the candidate" for the reason that "[b]allots serve primarily to elect candidates, not as forums for political expression"189. In Sarvis v Judd190, Virginian laws that provided for a tiered ordering of the ballot paper were upheld despite their intended effect of "placing the candidates of the established, and larger, parties ahead of smaller parties and independents on 185 Tribe, American Constitutional Law, 2nd ed (1988) at 1097 §13-18. 186 Jenness v Fortson (1971) 403 US 431 at 442; American Party of Texas v White (1974) 415 US 767 at 782 fn 14; Storer v Brown (1974) 415 US 724 at 732-733; Munro v Socialist Workers Party (1986) 479 US 189 at 193-194, 203. See also Bullock v Carter (1972) 405 US 134 at 145; Lubin v Panish (1974) 415 US 709 at 712-713, 715; Anderson v Celebrezze (1983) 460 US 780 at 788-789; Timmons v Twin Cities Area New Party (1997) 520 US 351 at 364-365. 187 Douglas, "Is the Right to Vote Really Fundamental?" (2008) 18 Cornell Journal of Law and Public Policy 143 at 184. 188 (1997) 520 US 351 at 369, quoting Burdick v Takushi (1992) 504 US 428 at 438. 189 (1997) 520 US 351 at 363. See also Burdick v Takushi (1992) 504 US 428 at 438, 190 (2015) 80 F Supp 3d 692 at 699. the ballot, thereby depriving the Candidates of an opportunity to reap the windfall vote". The response in that case to the State interest to "prevent voter confusion"191 was a measure that intentionally advantaged larger parties in the presentation of information on the ballot paper. In contrast, the 2021 Amendments are not merely facially neutral in their effect upon presentation of information: as explained below, there is no evidence that voters will be deprived of the opportunity to make an informed electoral choice and there is no factual basis to conclude that any advantage will accrue to a prior registered party, other than to secure the votes of people who would otherwise have been confused. In Independent Party v Padilla192, the Court of Appeals for the Ninth Circuit considered the validity of §5001(a) of the California Elections Code, which required, as a condition before official political party status was granted, that "[t]he designated name shall not be so similar to the name of an existing party so as to mislead the voters, and shall not conflict with that of any existing party or political body that has previously filed notice pursuant to subdivision (b)". The Ninth Circuit upheld, on the basis of the State interest in avoiding confusion in the democratic process, the application of §5001(a) to deny "official political party status" to the "Independent Party" in circumstances in which the "American Independent Party" was an existing official political party. A subsequent application for certiorari was denied by the Supreme Court193. Mr Ruddick did not establish any burden on electoral choice or the freedom of political communication As explained above, a threshold issue for Mr Ruddick in his submissions concerning constraints on legislative power arising from (i) ss 7 and 24 of the Constitution, and (ii) the implied freedom of political communication was to establish that the 2021 Amendments placed some burden on, respectively, informed electoral choice or the ability to communicate on government or political matters. Both of Mr Ruddick's submissions fail at this threshold stage. Mr Ruddick effectively asks this Court to infer that the quality of electoral choice, or the freedom of communication on government or political matters, will be impaired due to the inability of a candidate to have, accompanying their name on the ballot paper, the name and logo of a party which includes a word used in another party's name. That conclusion is not self-evident. Rather, on the material 191 (2015) 80 F Supp 3d 692 at 706. 192 (2017) 702 Fed Appx 631. 193 Independent Party v Padilla (2018) 138 S Ct 1342. before the Court, the expected conclusion would be the opposite. The likely effect of the narrow restrictions imposed by the 2021 Amendments is, overall, to improve the clarity, and hence the quality, of electoral choice and communication on government or political matters. The starting point is the impugned provisions of items 11 and 14 of the 2021 Amendments, which introduced ss 134A(1)(a)(iii) and 134A(1A) concerning existing registered political parties with a word in their name or logo that is used in the name or abbreviation of an earlier registered political party which objects to the use of that word. As explained above, the manner in which Mr Ruddick's challenge was made focused upon the application of these provisions to the Liberal Democratic Party. On the assumption that the 2021 Amendments would operate to require the deregistration of the Liberal Democratic Party under that name, as it was registered after the Liberal Party, Mr Ruddick's submission invites consideration of how that deregistration would impair the quality of electoral choice by the public, or the quality of communication on government or political matters to the public. Apart from the content of the ballot paper, deregistration of the Liberal Democratic Party would not preclude any communication with the public, including communication using the name "Liberal Democratic Party". The only potential restraint on the quality of electoral choice by the public, or on communication on government or political matters to the public, is that, by s 169 of the Commonwealth Electoral Act, a candidate for election endorsed by the Liberal Democratic Party, such as Mr Ruddick, would be unable to have that party name printed adjacent to their name on the ballot paper. Yet, as the 2013 election demonstrated, that would have the effect of reducing confusion and thus enhancing the quality of electoral choice by the public. Even if it were accepted that there was some small constraint upon political communication and the quality of electoral choice by the inability of a candidate endorsed by the Liberal Democratic Party to use the word "liberal" on the ballot paper, the net effect would still be an enhancement of electoral choice and the quality of communication on government or political matters to the public. Contrary to Mr Ruddick's submissions, the Liberal Democratic Party would not be precluded, or impaired in any real way, from using its name to communicate any message of political philosophy. As the Commonwealth correctly submitted, items 11 and 14 do not preclude registration of names which use derivatives of the word "Liberal" in its title. The variety of the English language permits many possible derivatives of a word, compounds of the word, or synonyms for the word. The same point can be made in relation to another political party mentioned in the special case, the "liberals for forests". In 2001, the Administrative Appeals Tribunal held that the "liberals for forests" did not present any "real risk" of being confused with or mistaken for the "Liberal Party of Australia" or the name "Liberal"194, although the Tribunal accepted that "[i]t may be that some persons will draw the inference that members of 'liberals for forests' are former members or have some affiliation with the Liberal Party of Australia or one of its State divisions"195. The latter confusion by electors was not held to be sufficient to preclude registration of the "liberals for forests". Just four years later, in its 2005 report, the Joint Standing Committee on Electoral Matters concluded that confusion between the liberals for forests and the Liberal Party was the reason for the narrow defeat of the National Party candidate for Richmond in the 2004 federal election. The Committee referred to evidence that the "how to vote" card for the liberals for forests replicated the colours and layout of previous Liberal Party "how to vote" cards and emphasised the word "LIBERALS" in capitals, overshadowing "for forests"196. The obvious inference to be drawn from the material in the special case is that the absence of the party name "liberals for forests" on the ballot paper would enhance the quality of electoral choice and political communication by reducing the potential for confusion. Conversely, there was no fact in the special case, and no written or oral submission from Mr Ruddick, which would permit any inference that, if the liberals for forests were prevented from using the word "liberal" in their party name on the ballot paper, the quality of choice of even a single elector, or any communication on a government or political matter, would be impaired in any way. The liberals for forests, in this example, could have continued to operate and campaign under that same name or a similar name and hand out "how to vote" cards with that or a similar name, which explained that liberals for forests would be named on the ballot paper with the chosen alternative, including any derivative word from "liberal". 194 Re Woollard and Australian Electoral Commission (2001) 32 AAR 492 at 507 [46]. 195 Re Woollard and Australian Electoral Commission (2001) 32 AAR 492 at 507 [46]. 196 Joint Standing Committee on Electoral Matters, Report of the Inquiry into the Conduct of the 2004 Federal Election and Matters Related Thereto (2005) at 115 The implied freedom of political communication was not engaged Mr Ruddick's case based on freedom of political communication fails for a further reason. His submissions are indistinguishable from the basis upon which five members of this Court in Mulholland v Australian Electoral Commission197 upheld the validity of earlier amendments to the registration scheme in the Commonwealth Electoral Act. Mr Ruddick did not seek leave to challenge the correctness of that decision. implied the Like this case, the appeal in Mulholland concerned Pt XI of the Commonwealth Electoral Act. Mr Mulholland, the registered officer of the Democratic Labor Party, challenged two conditions for a political party to obtain registration and have its name printed on the ballot paper as contrary to the implied freedom of political communication. Those conditions were: (i) the party must have 500 members, and (ii) two or more parties could not count the same person as a member for the purposes of registration. Each of McHugh J, Gummow and Hayne JJ, Callinan J and Heydon J expressly approved the reasoning of McHugh J in Levy v Victoria198 and held that proof of a burden on the freedom of political communication requires "proof that the challenged law burdens a freedom that exists independently of that law"199. Mr Mulholland's challenge failed because the Democratic Labor Party had no right to be included on the ballot paper, independently of the provisions of the Commonwealth Electoral Act200. Conclusion The questions of law stated for the consideration of the Full Court in the Special Case filed on 3 December 2021 should be answered as follows: Question 1. Are any of items 7, 9, 11 and 14 of Sch 1 to the Electoral Legislation Amendment (Party Registration Integrity) Act 2021 (Cth) invalid, in whole or in part, on the ground that they infringe the implied freedom of political communication? 197 (2004) 220 CLR 181. 198 (1997) 189 CLR 579 at 622. 199 (2004) 220 CLR 181 at 223-224 [107]-[108]. See also at 246 [184], 247 [186]-[187], 200 (2004) 220 CLR 181 at 224 [110], 247 [186], 298 [337], 303-304 [354]. Answer: In relation to items 11 and 14 of Sch 1 to the Electoral Legislation Amendment (Party Registration Integrity) Act 2021 (Cth), the answer is "No". Otherwise unnecessary to answer. Question 2. Are any of items 7, 9, 11 and 14 of Sch 1 to the Electoral Legislation Amendment (Party Registration Integrity) Act 2021 (Cth) invalid, in whole or in part, on the ground that they preclude the direct choice by the people of Senators and Members of the House of Representatives, contrary to ss 7 and 24 of the Constitution? Answer: In relation to items 11 and 14 of Sch 1 to the Electoral Legislation Amendment (Party Registration Integrity) Act 2021 (Cth), the answer is "No". Otherwise unnecessary to answer. Question 3. In light of the answers to Questions 1 and 2, what relief, if any, should issue? Answer: None. Question 4. Who should pay the costs of and incidental to this special case? Answer: The plaintiff. STEWARD J. The amendments made to the Commonwealth Electoral Act 1918 (Cth) ("the Act") by the Electoral Legislation Amendment (Party Registration Integrity) Act 2021 (Cth) may rightly be characterised as heavy-handed. Conferring upon this country's two major political parties enduring monopolies over the words "liberal" and "labor" (or "labour") for the purposes of party registration under the Act, and as a solution to voter confusion, may be unappealing. However, this Court has traditionally deferred to the legislative branch in the case of laws regulating federal elections. That is because the concept of "representative democracy" comprehends a large range of virtues and possibilities. As Keane J observed in Murphy v Electoral Commissioner201, it is "not permissible to deduce from one's 'own prepossessions' of representative democracy a set of irreducible standards against which the validity of Parliament's work may be tested". The invalidation of "Parliament's work" must therefore be reserved to those more extreme laws which offend the most essential of democratic values and systems. On balance, that is not this case. The joint reasons of Gordon, Edelman and Gleeson JJ demonstrate that the amendments made to the Act in 2021 enhance the quality of a free and informed election by the further elimination of confusion arising both from the use of the same key word in the name of two parties and from the location of a party name on a ballot paper, especially in relation to a Senate ballot. It is for that reason that I respectfully concur with the reasons of their Honours and agree with their answers to the questions stated for the consideration of the Full Court. I otherwise refer to my reasons in LibertyWorks Inc v The Commonwealth concerning the implied freedom of political communication202. 201 (2016) 261 CLR 28 at 86 [177] (footnote omitted). 202 (2021) 95 ALJR 490 at 554-556 [298]-[304]; 391 ALR 188 at 267-269.

HIGH COURT OF AUSTRALIA GUMMOW ACJ COMMISSIONER OF TAXATION APPELLANT AND RESPONDENT Commissioner of Taxation v McNeil [2007] HCA 5 22 February 2007 ORDER Appeal allowed. Set aside order 1 of the Full Court of the Federal Court made on 8 August 2005 and in its place order that the appeal to that Court be allowed, the orders of Conti J made on 14 April 2004 be set aside, and the appeal by the taxpayer against Commissioner made on 31 October 2002 be dismissed. the objection decision of the The appellant pay the costs of the respondent of this appeal. On appeal from the Federal Court of Australia Representation B J Shaw QC with G J Davies QC and S H Steward for the appellant (instructed by Australian Government Solicitor) D H Bloom QC with W G Muddle and K J Deards for the respondent (instructed Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Commissioner of Taxation v McNeil Income tax – Derivation of income – Respondent acquired shares which were later the subject of a buy-back arrangement that gave the respondent "sell-back rights" – The sell-back rights were held on trust and sold for the absolute benefit of the respondent – The increase in value of the sell-back rights was subject to capital gains tax upon sale – Whether the remaining income from the sale was subject to either income tax or capital gains tax – Whether the remaining proceeds of sale amounted to a derivation of income according to ordinary concepts – Whether character of receipt as income to be determined according to its quality in the hands of the recipient or the character of the expenditure by the other party – Whether sell-back rights can be treated as being "severed" or "detached" from the respondent's shares for taxation purposes. Income tax – Statutory interpretation – Whether subdiv D of Div 2 of Pt III of the Income Tax Assessment Act 1936 (Cth) formed a "code" regarding taxation of receipts by shareholders from companies. Words and phrases – "for the absolute benefit of", "income", "in satisfaction", "code", "sell-back right". Corporations Law, Ch 2J, ss 257A-257J. Income Tax Assessment Act 1936 (Cth), Pt III, Div 2, subdiv D. Income Tax Assessment Act 1997 (Cth), s 6-5. GUMMOW ACJ, HAYNE, HEYDON AND CRENNAN JJ. The respondent ("the taxpayer") is a widow of advanced years who has lived all her life in Australia. The amount of income tax at stake in this appeal is less than $600. The year of income in question is that which ended on 30 June 2001. The litigation has been treated as a test case, in the circumstances which are more fully described later in these reasons, and is said by the appellant ("the Commissioner") to affect more than 80,000 taxpayers. The taxpayer succeeded at first instance in the Federal Court (Conti J)1 and an appeal by the Commissioner was dismissed by the Full Court (French and Dowsett JJ; Emmett J dissenting)2. No order for costs was made by Conti J. An agreement was made between the parties that there be no order as to costs in the Full Court. It was a condition of the grant to the Commissioner of special leave to appeal to this Court that the Commissioner pay the costs of the appeal in any event and not seek to disturb the position respecting costs in the Federal Court. The SGL buy-back scheme In 1987, the taxpayer acquired a parcel of shares in St George Building Society Ltd. In 1992, these were converted into ordinary shares in St George Bank Ltd ("SGL") upon its change from a building society to a corporation carrying on the business of banking. Since 1992, shares in SGL have been listed for quotation on the Australian Stock Exchange ("ASX"). In the years following 1992, the profitability of SGL increased. As a result of rights issues, share- rounding plans and other events, at the time of the critical announcement by SGL on 12 January 2001 ("the record date"), the taxpayer's shareholding comprised 5,450 ordinary shares. On the record date, SGL announced an off-market buy-back of ordinary shares to the approximate value of $375 million; the buy-back was said to be designed to enhance returns to shareholders and to be the first step in proposals to convert existing preference shares to ordinary shares and issue new preference shares. The buy-back was to be funded by SGL from existing cash resources which, in turn, were to be replaced substantially by the issue of the new preference shares. 1 McNeil v Commissioner of Taxation (2004) 206 ALR 44. 2 Commissioner of Taxation v McNeil (2005) 144 FCR 514. Gummow ACJ Hayne Crennan The number of ordinary shares the subject of the announcement represented approximately 5 per cent of the then issued capital of SGL. For every 20 ordinary shares held at the record date and rounded down to the nearest whole number, SGL on 19 February 2001 ("the listing date") would issue to St George Custodial Pty Ltd ("Custodial") as trustee for the shareholder one "sell-back right". This would yield 272 sell-back rights for the taxpayer. The term "buy-back" was used from the perspective of SGL, while "sell-back" was used from the perspective of shareholders. Each sell-back right was to be a put option to oblige SGL to buy back one share for $16.50. Excluded from direct participation on the same terms as other ordinary shareholders were shareholders having a registered address outside Australia and New Zealand, and employees of SGL who held shares under certain employee share benefits schemes. More limited arrangements were made for these "excluded shareholders" to participate indirectly in the buy-back. The taxpayer was not an excluded shareholder. Implementation of the proposed share buy-back was governed, as a matter of company law, by what was then Div 2 (ss 257A-257J) of Pt 2J-1 of Ch 2J of the Corporations Law3. Chapter 2J was headed "Transactions Affecting Share Capital" and in various respects replaced or qualified the previous law respecting reductions in share capital, in particular the prohibition upon the purchase by a company of its own shares4. An appreciation of this change in the underlying company law is important when considering various of the revenue decisions to which the Court was referred in argument in this case. Section 257A of the Corporations Law permitted a company to buy back its own shares if the buy-back did not materially prejudice the ability of the company to pay creditors and the company followed the procedures laid down in Div 2. Section 257B(1) specified the procedures appurtenant to different types of buy-backs. In respect of what were classed as "selective buy-backs", s 257D stipulated special requirements for the obtaining of shareholder approval, beyond those requirements for "equal access schemes" (see s 257B(2)). No issue arises respecting compliance with Div 2. It is unnecessary to resolve apparent differences in submissions of the parties respecting the classification of the SGL buy-back scheme as a "selective" or "equal access" scheme. 3 See now Corporations Act 2001 (Cth), Ch 2J, Pt 2J-1, Div 2. 4 Trevor v Whitworth (1887) 12 App Cas 409; Thornett v Federal Commissioner of Taxation (1938) 59 CLR 787 at 795-796. Gummow ACJ Hayne Crennan The arrangements announced by SGL on the record date were implemented and controlled by a series of interconnected deeds poll, to which further reference will be made. Each of these documents was executed on the record date, 12 January 2001. On 10 January, ordinary shares in SGL had been traded at $13.88; the highest price at which shares had previously been traded was $14.10. On the listing date, 19 February, the share price was between $14.45 and $14.64 per share. The right to require SGL to purchase a share for $16.50 had a value represented by the amount by which that sum exceeded the market value. The parties agreed for the purposes of these proceedings that on that date the market value of one sell-back right was $1.89. Accordingly, the market value of the taxpayer's sell-back rights at the listing date was $514. On the listing date, SGL granted to Custodial more than 22 million sell- back rights to be held on the terms of the arrangements made by the deeds poll. The taxpayer and the other shareholders who had wished to obtain legal title to all or some of their sell-back rights so as to be able personally to sell their shares back to SGL or sell the sell-back rights on the market had been obliged to give a direction to Custodial before 5.00 pm on 16 February ("the election date"), that is to say, before the grant of those rights on 19 February. The taxpayer gave no such direction. The result of the controlling instruments in cases where no direction was given was that, on the grant by SGL on 19 February of 272 sell- back rights to be held for the taxpayer by Custodial as trustee, Custodial was obliged to sell those rights to a merchant bank, Credit Suisse First Boston Australia Equities Ltd ("CSFB"). CSFB was required to trade or exercise those rights and to account to Custodial as trustee for the taxpayer. From the issue date, the sell-back rights were listed and traded on the ASX and this continued until 13 March 2001 ("the listing period"). In this way, there was created a market in the sell-back rights themselves. This was important for those shareholders who did not wish to exercise the legal title to some or all of their sell-back rights or who, like the taxpayer, stood by and took no steps before the election date to acquire that legal title. The existence of this market also would help facilitate attainment of SGL's announced intentions of effecting a buy-back to the extent of about 5 per cent of its issued capital. The explanatory material sent by SGL to shareholders made it plain that shareholders not wishing to do so did not have to sell any shares to SGL. But the material also told shareholders that they could purchase additional sell-back rights on the ASX and thereby increase the number of shares they could oblige SGL to acquire. In this way, the sell-back rights are more readily seen to have been separate and detached from the shares in respect of which they had been granted by SGL; the rights were objects of commerce and by reason of Gummow ACJ Hayne Crennan acquisition by another shareholder could be exercised in respect of shares of that shareholder. The issue of the 272 sell-back rights for the taxpayer and what then ensued did not involve any return of capital paid up on her shares, nor any variation or re-expression of her rights as a shareholder. Shareholders, such as the taxpayer, who before the election date gave no directions in respect of their entitlements were to be paid the proceeds of trading activities in their rights which were to be conducted on their behalf by CSFB. But, unlike those shareholders who exercised their sell-back rights to require SGL to purchase their shares at the buy-back price of $16.50, or who purchased additional rights on the ASX and exercised them, these shareholders retained their shares. The issues on the appeal The taxpayer's 272 sell-back rights were included in more than 11 million sell-back rights sold by Custodial to CSFB on 20 February 2001. These then were sold by CSFB on the ASX during the listing period or exercised by CSFB itself in accordance with the CSFB Deed Poll. On 2 April 2001, the taxpayer received her portion of the proceeds, being $576.64, by direct deposit into her bank account with SGL. Of that sum, $62.64 represented the increase in the realisable value after the issue date. The taxpayer concedes that the sum of $62.64 was assessable income as a capital gain. The dispute turns upon the character of the balance of $514, representing market value at the issue date. The Commissioner seeks to bring this to tax either as income according to ordinary concepts, pursuant to s 6-5 of the Income Tax Assessment Act 1997 (Cth) ("the 1997 Act") or as a capital gain. However, if the Commissioner succeeds in his reliance upon s 6-5, then the anti-overlap provision of s 118-20 means that if the same event gives rise to both income and a capital gain, the capital gain is reduced to the extent that income was assessable. As an Australian resident, the assessable income of the taxpayer included income according to ordinary concepts derived directly or indirectly from all sources; in determining the existence of a derivation and when it occurred, the taxpayer was taken by s 6-5(4) "to have received the amount as soon as it [was] applied or dealt with in any way on [her] behalf or as [she directed]". Having allowed the taxpayer's objection, Conti J remitted the matter to the the Commissioner for reassessment according to law. Commissioner, the Full Court divided. French and Dowsett JJ, in separate judgments, held that the appeal failed. There had been no derivation of income and no capital gain beyond the $62.64. Emmett J disagreed and concluded that there had been a derivation of income to which s 6-5 applied. Although that On appeal by Gummow ACJ Hayne Crennan conclusion made it unnecessary to do so, Emmett J went on to consider the issue respecting capital gains tax and decided this adversely to the Commissioner. The majority of the Full Court erred in application of the principles respecting the derivation of income according to ordinary concepts. It follows that the appeal should be allowed on that ground. This renders it unnecessary to consider the operation of the capital gains provision. The Commissioner primarily submits that the grant on 19 February 2001 of the 272 sell-back rights in respect of the taxpayer's shareholding and held by Custodial for her absolute benefit was the derivation of income by her in the amount of $514 and, alternatively, further submits that, in any event, the receipt of the proceeds on 2 April 2001 was income in her hands. It is the primary submission that should be accepted, so that the alternative submission need not be determined. General principles Before turning to explain why the appeal should have that outcome, and before looking more closely at the documents by which the share buy-back procedures were implemented, there are several preliminary points to be made. First, whether a particular receipt has the character of the derivation of income depends upon its quality in the hands of the recipient, not the character of the expenditure by the other party5. It follows, despite indications to the contrary in the judgments of the majority in the Full Court6, that the character of the sell- back rights held for the taxpayer is not determined by considerations that her entitlement arose out of the decision by SGL to effect the buy-back process and that this involved capital restructuring by SGL. The Commissioner correctly submits that, while the share buy-back scheme explains the involvement of SGL and the genesis of the conferral of the entitlement upon the taxpayer, for revenue purposes it does not explain the character of her sell-back rights. Secondly, as a general proposition, a gain derived from property has the character of income and this includes a gain to an owner who has waited 5 GP International Pipecoaters Pty Ltd v Federal Commissioner of Taxation (1990) 170 CLR 124 at 136. (2005) 144 FCR 514 at 529, 530, 568-569. Gummow ACJ Hayne Crennan passively for that return from property7. The question then becomes one whether, as the Commissioner contends, the rights enjoyed by the taxpayer arose and were severed from, and were a product of, her shareholding in SGL, which she retained. The metaphor of severance and like expressions were used by Pitney J in Eisner v Macomber8 in a passage accepted in Federal Commissioner of Taxation v Montgomery9 as identifying the core meaning of "income" where the character of a gain associated with property is at stake. It should be pointed out with respect to the application to this case of the reasoning in Eisner that, contrary to one approach in the Full Court10, the taxpayer was not in a like position to a party who received payment to give up part of a profit-yielding structure or on the sale of new rights in the nature of a profit à prendre which were carved out of that structure. The taxpayer's shareholding in SGL remained untouched. Further, the sell-back rights which the taxpayer enjoyed and which were turned to account on her behalf did not represent any portion of her rights as a shareholder under the constitution of SGL. The sell-back rights were generated by the execution, and subsequent performance, of covenants in the deeds poll, to which further reference now should be made. The deeds poll Three deeds poll, all made on 12 January 2001, the record date, established the scheme arrangements as they affected the taxpayer11. By the Sell Back Right Deed Poll executed by SGL in favour of parties including shareholders, such as the taxpayer, who were registered at the record date, and also Custodial and CSFB, SGL covenanted to grant the sell-back rights to Custodial "for the absolute benefit" of those shareholders (cl 2(a)). The 7 Parsons, Income Taxation in Australia: Principles of Income, Deductibility and Tax Accounting, (1985) at 87-89. 8 252 US 189 at 206-207 (1920). See also Inland Revenue (1999) 198 CLR 639 at 660-663 [62]-[69]. Commissioners v Blott; Inland Revenue Commissioners v Greenwood [1921] 2 AC 10 (2005) 144 FCR 514 at 569. 11 The Deed Poll (Excluded Shareholder) may be put to one side. Gummow ACJ Hayne Crennan entitlements of those shareholders who did not take up their legal title to the rights were to be sold to CSFB, to be dealt with by CSFB under the CSFB Deed Poll (cl 2(c)). The Deed Poll (Shareholders) was executed by SGL and Custodial. The latter as trustee, was obliged to hold absolutely for each "participating shareholder" the proceeds of the dealings by CSFB in those entitlements not taken up by shareholders (cl 2.2); Custodial appointed CSFB its paying agent to effectuate payment by SGL of those proceeds to shareholders (cl 3.2). The CSFB Deed Poll was executed by CSFB in favour of parties including those "non-acceptance shareholders" such as the taxpayer, and also SGL and Custodial. CSFB was obliged to sell on the ASX or to exercise the sell-back rights relative to those shareholders and to deal with the proceeds as already described (cl 3). In the events that happened, including the election of the taxpayer not to take the steps necessary to acquire legal title to her sell-back rights, she became, at the issue date, entitled at least to the observance and performance of the obligations owed to her under the deeds poll by Custodial and CSFB. Further, it may also be said that she acquired a beneficial interest in the covenants supporting the obligation assumed by SGL to honour the relevant put options it had created by deed poll. However the situation be treated from the viewpoint of the principles of equity12, two relevant observations may be made. First, the taxpayer's rights were accrued, not merely executory, and were vested in her. Secondly, that result applied notwithstanding the apparent absence of any consideration moving from her; this result was a significant consequence in the law from the use of covenants in the deeds poll13. Previous authorities in this Court Counsel for the taxpayer referred to various authorities in this Court in which issues arose respecting the revenue character of certain distributions to shareholders. The authorities began with Commissioner of Taxation (NSW) v 12 cf CPT Custodian Pty Ltd v Commissioner of State Revenue (2005) 224 CLR 98; Halloran v Minister Administering National Parks and Wildlife Act 1974 (2006) 80 ALJR 519; 224 ALR 79. 13 Jones v Bartlett (2000) 205 CLR 166 at 206-207 [141]. Gummow ACJ Hayne Crennan Stevenson14. The taxpayer had participated in an informal distribution of assets of a family company in advance of an attempted voluntary liquidation. The majority in this Court (Rich, Dixon, Evatt and McTiernan JJ) held that no part of the money received by the taxpayer was a dividend, profit or bonus paid by the company within the meaning of the New South Wales taxation legislation and that the legislation brought to tax distributions or detachments of profit by a in retirement or company as a going concern but not "distributions extinguishment of the shares"15. Rich, Dixon and McTiernan JJ stressed that the case turned upon the construction of the legislation and the definition of "dividend"16. Stevenson was applied, with respect to the Income Tax Assessment Act 1922 (Cth) ("the 1922 Act"), in Thornett v Federal Commissioner of Taxation17. At stake was the revenue nature of money and investments being part of the assets of a company which the taxpayer was paid out upon cancellation of certain issued shares in that company. The reduction of capital had received court confirmation under applicable companies legislation. This Court held that the distributions to the taxpayer were not a dividend, bonus or profit, credited, paid or distributed to a shareholder within the meaning of the 1922 Act. Latham CJ said that what the transaction "really amounted" to was "a surrender by a shareholder of all capital interest in the company in return for a lump sum payment"18. Federal Commissioner of Taxation v Blakely19 concerned the revenue treatment under the Income Tax Assessment Act 1936 (Cth) ("the 1936 Act"), as it stood amended in 1942, of distributions to shareholders in an informal liquidation conducted without any action to put the company into liquidation or to appoint a liquidator. This Court held that, as s 44 of the 1936 Act then stood, there had been no distribution by way of dividend out of profits of the company as required to attract that provision. Section 47, as it then stood, did not apply 14 (1937) 59 CLR 80. 15 (1937) 59 CLR 80 at 103. 16 (1937) 59 CLR 80 at 98-99, 103. 17 (1938) 59 CLR 787. 18 (1938) 59 CLR 787 at 796. 19 (1951) 82 CLR 388. Gummow ACJ Hayne Crennan because there had been no distribution by a liquidator in the winding-up. Fullagar J (with whose reasons Dixon J agreed) considered that what had been received was of a capital rather than income nature; there had been "a realization" of a share investment but "no detachment or severance from the funds of the company of money or other assets as representing a profit made by the company", and nothing in the 1936 Act gave the character of income to what otherwise was a capital receipt20. The reasoning in Stevenson and Thornett was followed. Thereafter, in Federal Commissioner of Taxation v Uther21, it was decided (Taylor and Menzies JJ; Kitto J dissenting) that s 44 of the 1936 Act, read with the definition of "dividend" in s 6(1) as it then stood, did not bring into assessable income the excess of the amount received by a shareholder in respect of shares cancelled in consequence of a duly confirmed reduction of capital over the amount actually paid up on those shares. Later, in Federal Commissioner of Taxation v Slater Holdings Ltd, the reasoning of Kitto J was said by Gibbs CJ (with whom Mason, Brennan, Deane and Dawson JJ agreed) to be "compelling"22. Kitto J23 took a view of the legislation which differed from that of Fullagar J in Blakely; the particular dividend provisions in question looked not to the nature of the receipt (as principle generally required) but to the nature of the source from which the distribution was made; here, that was profits. In Slater Holdings, Gibbs CJ summed the matter up as follows24: "Fullagar J was right in saying that the distribution made to the shareholders in Federal Commissioner of Taxation v Blakely was a capital receipt according to general principles, but he gave insufficient weight to the change that had been effected to the law by defining 'dividend' so as to include a distribution made by a company to any of its shareholders." In the meantime, as a sequel particularly to the majority decision in Uther, the definition of "dividend" in the 1936 Act was replaced and amendments were made to s 44 by the Income Tax Assessment Act (No 4) 1967 (Cth). Section 44 is 20 (1951) 82 CLR 388 at 407. 21 (1965) 112 CLR 630. 22 (1984) 156 CLR 447 at 457. 23 (1965) 112 CLR 630 at 640. 24 (1984) 156 CLR 447 at 457. Gummow ACJ Hayne Crennan the central provision in subdiv D, headed "Dividends", of Div 2 of Pt III of the 1936 Act. Division 2, which begins with s 25, deals with "Income". The first submission by the taxpayer Counsel for the taxpayer referred to the above decisions of this Court and to the structure of Div 2 of Pt III of the 1936 Act to claim support for her case in two respects. First, the reasoning in these cases was said to indicate an error in the case put by the Commissioner, the error being in speaking of the sell-back rights as severed or detached from the taxpayer's shares. It was said that the Commissioner conflated two rights, the "general right" to returns of capital, this being "part of the variety of rights making up the share", on the one hand, and the grant by SGL of the sell-back rights in "effectuation" of the foregoing "general right". In further support of this submission, counsel referred in particular to passages in Ord Forrest Pty Ltd v Federal Commissioner of Taxation25. There, Gibbs J and Mason J, in the course of dismissing an argument in terrorem by the taxpayer as to the consequences of holding that the Gift Duty Assessment Act 1941 (Cth) applied to the particular facts, denied the general proposition that there was an element of gift where a share was allotted for less than its true value26. Mason J said that "the allotment is made to a member in satisfaction of the rights which he enjoys as a shareholder ... under [the corporation's] memorandum and articles of association"27. Nor was there an element of gift in an offer made by a company to its shareholders of renounceable (ie, saleable) rights to take up new shares in proportion to then existing holdings28. From that standpoint, the taxpayer submitted that the issue of bonus shares and of renounceable rights does not give rise to the derivation by the shareholder of income according to ordinary concepts, because, for the reasons explained by Gibbs J and Mason J in Ord Forrest, there was not the requisite "detachment" or "severance" from the existing shareholding. 25 (1974) 130 CLR 124. 26 (1974) 130 CLR 124 at 150-151, 155-157. 27 (1974) 130 CLR 124 at 156. 28 (1974) 130 CLR 124 at 151, 157. Gummow ACJ Hayne Crennan The taxpayer also relied in this respect upon Federal Commissioner of Taxation v Miranda29 and Macmine Pty Ltd v Commissioner of Taxation (Cth)30. However, the question there was whether the sale of rights made at a profit attracted s 26(a) of the 1936 Act and did not concern what may have been the revenue nature of those rights as they were issued. Contrary to the taxpayer's submission, it is insufficient to say that SGL issued the sell-back rights to Custodial on behalf of shareholders "in partial satisfaction of the shareholders' right to participate in reductions of capital", this being "within the congeries of rights comprising the shares". It is the character of the grant of rights to the shareholders that, as already explained, is decisive. It is not the reduction of capital effected by SGL pursuant to the new statutory processes provided by the Corporations Law. The gain made by the taxpayer upon grant of the sell-back rights and the subsequent receipt of the proceeds of sale on her behalf was not the receipt of a distribution of any form of the assets of SGL. Nor, as explained earlier in these reasons, was the sell-back scheme provided "in satisfaction" of the rights of shareholders under the constitution of SGL. The scheme took its life from the deeds poll executed on the record date. Thus, there is no sound analogy between this case and the liquidation and informal distribution cases beginning with Stevenson31, and the cases dealing with the dividend provisions of the 1936 Act. Nor is the receipt of bonus shares a sound analogy to the position of the taxpayer here. Bonus shareholders do not receive a gain severed and detached from their existing shareholding. Rather, their proportional interest in the business of the company is re-expressed in the sense explained in Inland Revenue Commissioners v Blott32. In that case, Viscount Finlay, with reference to Eisner33, said34: 29 (1976) 11 ALR 85. 30 (1979) 53 ALJR 362; 24 ALR 217. 31 (1937) 59 CLR 80. 32 [1921] 2 AC 171 at 192-196. 33 252 US 189 at 207 (1920). 34 [1921] 2 AC 171 at 195. Gummow ACJ Hayne Crennan "In the present case the bonus or so-called dividend was not severed from the capital; on the contrary, it was added to it. ... What might have been paid as income went to increase the capital of the company. The shareholder got his proportionate share in the business of the company as increased by the additional capital." The first submission by the taxpayer should be rejected. The taxpayer's second submission The taxpayer also submitted what was said to be a "code" argument. This was that s 44 and companion sections in subdiv D of Div 2 of Pt III of the 1936 Act together constitute a complete code with respect to the taxation of receipts by shareholders from companies. The term "code" ordinarily is used to describe the statutory replacement of the common law upon a particular subject35. However, taxes are imposed and levied by statutes and the term "code" has an awkward application in that setting36. Moreover, the practice for laws of the Commonwealth imposing taxation not to deal in the one Act both with imposition of taxation and the assessment, collection and recovery of the tax37 indicates that the 1936 Act, when read with the 1997 Act, cannot be said to constitute a "code" in any real sense of the term. It is to be recalled that the 1936 Act and the 1997 Act, for income years following that which ended on 30 June 1998, have concurrent operation; although the latter now contains the general provisions rendering income liable to taxation, the former still contains specific provisions governing the taxation of certain forms of income. Section 44 of the 1936 Act is one of those provisions (see s 10-5, 1997 Act). In essence, the submission by the taxpayer on this branch of the case is that the application of the generally expressed provision in s 6-5 of the 1997 Act is to be restricted by a process of construction giving an exhaustive operation to the dividends subdivision in the 1936 Act. That exhaustive 35 See, for example, Gamer's Motor Centre (Newcastle) Pty Ltd v Natwest Wholesale Australia Pty Ltd (1987) 163 CLR 236 at 243-244; Bellino v Australian Broadcasting Corporation (1996) 185 CLR 183 at 220. 36 Malika Holdings Pty Ltd v Stretton (2001) 204 CLR 290 at 309 [63]. 37 See Permanent Trustee Australia Ltd v Commissioner of State Revenue (Vict) (2004) 220 CLR 388. Gummow ACJ Hayne Crennan operation of subdiv D of Div 2 of Pt III of the 1936 Act, for the submission to be accepted, must cover not only receipts by shareholders which are brought to tax as assessable income by the subdivision, but also receipts which are not dividends in the defined sense of the term and are not otherwise reached by the subdivision. Thus, the "exhaustive" operation of the subdivision gives it a negative effect which is found by implication and goes beyond the terms of the subdivision. Both sides agree that the taxpayer's sell-back rights were not "dividends" in the statutory sense. It may be assumed for present purposes that the rights to ordinary concepts. otherwise would give rise Nevertheless, if the "code" argument be correct, they cannot do so. It would be an heroic exercise, and certainly not one previously undertaken in the cases to which the taxpayer referred, to construe the dividend provisions, which bring in gains, some of which would otherwise be of a capital nature, as implicitly excluding from the general income provision what otherwise would fall within it. income according The exercise must fail. The taxpayer gave many examples of the inclusion in the dividend provisions of measures to deem as assessable income that which would not be income according to ordinary concepts. But that does not support the implicit exclusion from s 6-5 of the 1997 Act of other items of income according to general concepts. Counsel invoked the decision of this Court applying s 109 of the Constitution by reference to the "covering" of a "field". But it is agreed, as noted above, that the grant of the sell-back rights fell outside the dividend provisions which must mark out the field. The general position respecting the relations between the general and specific provisions of the 1936 Act was indicated by Dixon CJ and Williams J in Federal Commissioner of Taxation v Dixon38 as follows: "As a result of s 25 what is gross income derived directly or indirectly from all sources or all sources in Australia, as the case may be, depends upon what is income. ... [The 1936 Act] begins with the general conception of gross income and specifies in s 23 what is exempt and in s 26 and other sections particular classes of income that are to be included. Sometimes these classes of income appear to be specified simply for 38 (1952) 86 CLR 540 at 555. Gummow ACJ Hayne Crennan greater certainty, sometimes because they do not fall within the natural understanding of gross income". The same is true of the relationship between the general provision of s 6-5 of the 1997 Act and the specific provisions contained, amongst other places, in subdiv D of Div 2 of Pt III of the 1936 Act. In Reseck v Federal Commissioner of Taxation39, differing views were expressed as to the relationship between s 26(d) of the 1936 Act, including in the assessable income 5 per cent of the capital sum of certain allowances and gratuities, and s 25(1). Stephen J (who dissented as to the outcome in Reseck) asked whether any "conflict" arose between the two provisions and referred to authorities dealing with the relationship between an earlier and later statute, particularly where a specific provision was followed by a general provision40. However, whilst the 1936 Act was much amended, both s 25(1) and s 26(d) had not been materially changed. No question of implied repeal arose41. Gibbs J, who, with Jacobs J, formed the majority in Reseck, construed s 26(d) as having both a charging and liberating effect, to tax both a percentage of an amount otherwise not brought to tax at all and a percentage of an amount otherwise assessable in full42. Two points should be made here. First, this reasoning as to the relationship between s 25(1) and s 26(d) is an anticipation of the processes of construction of the one statute, now required by Project Blue Sky Inc v Australian Broadcasting Authority43, whereby apparent conflict is alleviated. Secondly, there is no such conflict in the first place between s 25(1) and the dividend provisions which is presented by the circumstances of the present case. 39 (1975) 133 CLR 45. 40 (1975) 133 CLR 45 at 53-54. 41 cf Minister for Immigration and Multicultural and Indigenous Affairs v Nystrom (2006) 81 ALJR 1; 230 ALR 370. 42 (1975) 133 CLR 45 at 50. 43 (1998) 194 CLR 355 at 381-382 [70]-[71]. See also Peldan v Anderson (2006) 80 ALJR 1588; 229 ALR 432. Gummow ACJ Hayne Crennan Jacobs J, the remaining member of the Court in Reseck, began from the standpoint that, because s 26(d) brought in only 5 per cent of the sum received, only one of the two sections could be applicable44. His Honour concluded that as a "special provision" which, with s 26(e) "cover[ed] the whole subject matter of allowances, gratuities and compensation", s 26(d) must be given effect in preference to the general provision of s 25(1)45. The reference to the covering of the whole field does not assist the taxpayer in the present case. First, this is not a case of amounts brought into assessable income, wholly or in part, by two provisions. Secondly, the "special provision" has no operation in the present case and no legislative intention is disclosed to imply a negative which limits the general provision of s 25(1). The taxpayer's second submission should be rejected. Conclusions and orders For the reasons stated earlier in these reasons, the Commissioner's submissions that the majority of the Full Court erred should be accepted. In particular, on the listing date, 19 February 2001, when the taxpayer's sell-back rights were granted by SGL to Custodial "for the absolute benefit" of the taxpayer, as stated in the Sell Back Right Deed Poll, there was a derivation of income by her represented by the market value of her rights of $51446. That conclusion makes it unnecessary to consider the income nature of the receipt of the proceeds on 2 April 2001. The appeal should be allowed and order 1 of the orders of the Full Court set aside. In place thereof, the appeal to that Court should be allowed, the orders of Conti J made on 14 April 2004 set aside and the appeal by the taxpayer against the objection decision of the Commissioner made on 31 October 2002 dismissed. The Commissioner is to pay the costs of the taxpayer of the appeal to this Court. 44 (1975) 133 CLR 45 at 57. 45 (1975) 133 CLR 45 at 57. 46 cf Abbott v Philbin [1961] AC 352. Callinan CALLINAN J. The issues, the facts and the relevant statutory provisions are set out in the joint judgment. Because my opinion is a dissenting one, and I agree in substance with the reasoning of the majority in the Full Court of the Federal Court, it is not necessary for me to state in elaborate detail why I would decide the appeal differently from the majority in this Court. The key to unlock the problem here is to be found in the observation of French J, that the money received by the respondent47: "… was not an entitlement derived from profits earned by the company. It arose out of the decision by the company to reduce its issued capital through a buy back process." And that, inevitably was what happened when the transactions for which the documents provided were carried into full effect: the capital, including the value of the respondent's rights as a shareholder in respect of it, became less than it would otherwise have been, because St George Bank Limited ("SGL") had expended some of that capital in buying some of its own shares and reducing thereby the number of shares on issue. In my view the character of a payment for the purposes of the statutory definition of income, that is, "income according to ordinary concepts", is not always to be, indeed cannot always be, determined simply and solely by reference to its quality in the hands of a recipient. I do not take GP International Pipecoaters Pty Ltd v Federal Commissioner of Taxation48 and the other cases referred to in the reasons for decision there, to be denying reference to the full circumstances leading to the receipt in the hands of the taxpayer. It will usually only be by reference to a transaction as a whole that the quality of a receipt, otherwise perhaps even unintelligible, will begin to be able to be ascertained. In GP International this Court was dealing with an argument that a receipt was disbursable by the taxpayer and should not for that reason be treated as income, and was not enjoining courts in the future from examining the whole of a transaction to identify the quality of a receipt. The fact that the capital of the company suffered a reduction is far from irrelevant. But even if it were, and it were possible, as realistically I do not think it is, to look only to what the respondent had in her hands, the result is the same. She was left with a sum of money, and, it may readily be accepted, the same notional pieces of property, her shares, intact, representing a contingent 47 Commissioner of Taxation v McNeil (2005) 144 FCR 514 at 529 [44] per French J. 48 (1990) 170 CLR 124 at 136 per Brennan, Dawson, Toohey, Gaudron and Callinan entitlement to the capital of SGL reduced by reason of the expenditure of some of it to buy back its shares. The money that the respondent received was not "severed" from the shareholding in SGL. It was the result of a reorganisation of the capital of the company which effectively gave shareholders access to a component of it that they would not otherwise have had. It was not a dividend, nor was it analogous to one. The appellant, in his determination (the subject of the appeal) said this: "Although the [sell back] Rights were granted for the benefit of shareholders for nil consideration, they had a value because possession of a Right entitled the holder to sell SGL shares back to SGL for a price which exceeded the market value of the SGL shares." This statement wrongly assumes that the quoted price of the shares on the stock exchange from time to time was necessarily the correct and exclusive value of the shares. The fact that the sell back rights, available to shareholders, had an additional value shows that this is not so. In this case SGL's directors knew better than those in the usual marketplace, the stock exchange. Perhaps that value, coming to attach as it did specifically to shareholders' sell back rights, may have been a consequence wholly, or in part, of a perception, or the actuality, of the "tax-effectiveness" of the scheme, as three judges in the Courts below and I hold in effect it to be, but there is nothing unusual about that. Of course, the likely incidence of tax may affect value. If an example be required, Tait v Federal Commissioner of Taxation49 in which special provisions relating to the incidence of income tax upon graziers was held in this Court to affect the value of a deceased's estate for the purpose of federal estate duty, provides it. That the value of a species of property may be so affected does not change its character. The quoted price on the stock exchange of the shares in SGL was not the full measure of the value of the shares to shareholders on the relevant date as the directors of SGL knew, and took steps to establish by setting in motion the arrangements that they did. I agree with these passages in the judgment of Dowsett J50: "The Commissioner's case assumes that in the latter case, the relevant shareholding would remain unchanged, that the proceeds of sale 49 (1967) 116 CLR 620. 50 Commissioner of Taxation v McNeil (2005) 144 FCR 514 at 559 [178], 562-563 Callinan were produced by the Taxpayer's investment without any diminution in its value. This assumption is made superficially more attractive by the fact that sale of the Sell Back Rights led to the Taxpayer receiving money from a third party, not from SGL. However it is obvious that the only reason for purchasing Rights would be in order to exercise them by selling shares to SGL. That was an attractive opportunity because SGL was offering an amount which was well above the prevailing market price. A purchaser of Sell Back Rights would pay a price which reflected, to some extent at least, the gain to be made by selling shares to SGL, which gain was to be derived from the assets of SGL. By creating Sell Back Rights, SGL ensured that shareholders who chose not to sell their own shares would nonetheless participate indirectly in the distribution of SGL assets which was an essential element of the Scheme. The special sense in which I use the expression 'distribution of SGL assets' is obvious. In examining the Scheme, one must keep in mind the legal context in which it was designed and implemented. Shareholders had contractual and statutory rights as against SGL and inter se. In buying back one of its shares, SGL was buying the relevant shareholder's right to participate in dividends and in any surplus of assets over liabilities in a winding up. In this case, it seems that those rights were worth more than the paid up value of the share. The market price reflected the market's assessment of that value, but SGL offered an even greater amount. One must proceed upon the basis that SGL's offer reflected the Board's assessment of the true value of the shares. It is unlikely that the Board decided to buy the shares at a price above the amount which it considered to be their true value. Presumably, the board considered that the market was under-valuing the shares. For this reason, the offer was attractive to some, perhaps many, shareholders to whom market price was more important than the possible return from a notional winding up. What, then, was the purpose of the arrangement concerning the shareholders who did not accept the offer? It is conceivable that it was designed as a convenient mechanism for ensuring that the 5% target was achieved. However it is significant that those who designed the Scheme considered that there would be a worthwhile market for the Sell Back Rights, probably because the offer was well above the market price. Clearly, SGL considered that shareholders who chose not to sell should, nonetheless, be able to participate in the benefit of the Scheme. Given that such benefit cannot be characterised as a gift, one must ask why that view should have prevailed. The only likely answer is that as the Scheme involved the disbursement of company assets, there was at least a possibility to such shareholders, either because the value of their shares on an asset-backing the outcome would be disadvantageous that Callinan basis might be reduced (perhaps because the Board erred in assessing the value of the shares) or because the Scheme might have an adverse effect on the market price of the shares." I am unable to accept that the sell back rights which the respondent enjoyed, and which were turned to account on her behalf, did not represent any portion of her rights as a shareholder under the constitution of SGL; or that anything turns upon the execution of the scheme for what was, clearly, a reduction of capital, by the performance of covenants in deeds poll. Indisputable rights that the respondent had as a shareholder included her right with other shareholders to insist upon the application of the capital of SGL diligently and honestly in pursuance of its objects, and, in the event that there was an excess of it which SGL's directors thought might prudently be returned to shareholders, that it be returned to them in the same proportions as their shareholdings bore to all of the shareholdings in the company. It was not the deeds poll that breathed life into the scheme under which the respondent received the value of her sell back rights. The deeds poll recorded the scheme, and ensured that the respondent would receive her due under it, but the scheme itself had more to it than them. The availability of excess capital, SGL's directors' decision to return it to the shareholders, the selection and adoption of the means of doing so, the retention by shareholders, such as the respondent, of their shares intact, the actual reduction of capital that ensued, and the receipt of the value of the sell back rights by the shareholders, were the major elements of the scheme and constituted in totality its "life". I would also regard the cases, as to which there is unanimity only in that they are not determinative, to the extent that they are illuminating, as tending to support the respondent's position rather than the appellant's. By reason of the careful analysis by Dowsett J of them, it is unnecessary for me to do more than say that I agree with it. Capital Gain I am also in agreement with Dowsett J in the Full Court of the Federal Court that the "event" upon which the appellant relied, the issue of the sell back rights, did not of itself result in the receipt by the respondent of money, or indeed an entitlement to receive money. What is taxable in a given case is the capital gain calculated by reference to the amount of the capital proceeds "because of the 'Capital Gains Event'". And "capital proceeds" includes money, "other consideration … received" or money that a taxpayer is "entitled to receive" "because of the … event"51. "Consideration" is a term which involves an element 51 cf Commissioner of Taxation v McNeil (2005) 144 FCR 514 at 570 [218]-[220]. Callinan of exchange52, something which is missing here in relation to the sell back rights53. I would dismiss the appeal with costs. 52 Commissioner of Taxation v Scully (2000) 201 CLR 148 at 166 [25] per Gaudron ACJ, McHugh, Gummow and Callinan JJ. 53 cf Commissioner of Taxation v McNeil (2005) 144 FCR 514 at 570-571 [220].

HIGH COURT OF AUSTRALIA CHETAN SHRESTHA APPELLANT AND MINISTER FOR IMMIGRATION AND BORDER PROTECTION & ANOR RESPONDENTS BISHAL GHIMIRE AND APPELLANT MINISTER FOR IMMIGRATION AND BORDER PROTECTION & ANOR RESPONDENTS SHIVA PRASAD ACHARYA APPELLANT AND MINISTER FOR IMMIGRATION AND BORDER PROTECTION & ANOR RESPONDENTS Shrestha v Minister for Immigration and Border Protection Ghimire v Minister for Immigration and Border Protection Acharya v Minister for Immigration and Border Protection [2018] HCA 35 15 August 2018 M141/2017, M142/2017 & M143/2017 ORDER Each appeal is dismissed with costs. On appeal from the Federal Court of Australia Representation G A Costello with M W Guo for the appellants in all matters (instructed by Da Gama Pereira & Associates) C J Horan QC with A Aleksov for the first respondent in all matters (instructed by DLA Piper Australia) Submitting appearance for the second respondent in all matters Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Shrestha v Minister for Immigration and Border Protection Ghimire v Minister for Immigration and Border Protection Acharya v Minister for Immigration and Border Protection Migration – Cancellation of visa – Student visa – Where Minister for Immigration and Border Protection empowered to cancel visa if satisfied that any circumstances which permitted grant of visa no longer existed – Where delegate of Minister decided to cancel visa – Review of decision by Migration Review Tribunal – Where each appellant granted visa as "eligible higher degree student" – Where definition of "eligible higher degree student" required that visa applicant who proposed to undertake another course of study before and for purposes of principal course of study be enrolled in that other course of study – Where visa holder was enrolled in another course of study for purposes of principal course of study at time of grant of visa – Where visa holder ceased to be enrolled in that other course of study – Where Tribunal concluded that visa holder no longer "eligible higher degree student" – Where Tribunal concluded that circumstance which permitted grant of visa no longer existed – Whether Tribunal made error of law by considering legal characterisation of circumstance rather than circumstance itself – Whether jurisdictional error. Words and phrases – "another course of study", "circumstances", "eligible higher degree student", "error of law", "factual circumstances", "jurisdictional error", "principal course of study", "reasonably and on a correct understanding and application of the applicable law", "satisfied". Migration Act 1958 (Cth), s 116. Migration Regulations 1994 (Cth), Sched 2, cll 573.111, 573.223. KIEFEL CJ, GAGELER AND KEANE JJ. These three appeals were heard concurrently with the appeal in Hossain v Minister for Immigration and Border Protection1. Each falls to be determined in the application of the holding in that case that an incorrect understanding and application of the law in making a decision in the purported exercise of decision-making authority conferred by the Migration Act 1958 (Cth) does not constitute a jurisdictional error justifying the grant of relief under or by reference to s 75(v) of the Constitution if a correct understanding and application of the law could not in the circumstances have resulted in the decision that was made being a different decision. The decision-making authority in question in each appeal was that conferred by s 116(1)(a) of the Migration Act, which provided that "the Minister may cancel a visa if he or she is satisfied that ... any circumstances which permitted the grant of the visa no longer exist". The provision adopts the familiar structure of conferring on a repository (the Minister or his or her delegate) a specified discretion (to cancel a visa) which can only be exercised if a specified precondition is met (that he or she is satisfied that any circumstances which permitted the grant of the visa no longer exist). The satisfaction of the Minister or delegate required to meet that precondition is a state of mind formed reasonably and on a correct understanding and application of the applicable law2. The Full Court of the Federal Court in the decision under appeal3 held by majority that the word "circumstances" in s 116(1)(a) is properly construed as referring to a state of affairs as distinct from a legal characterisation of a state of affairs. That construction was challenged by notice of contention in the appeals. The question of the construction of that word in the section, however, does not warrant consideration by this Court. The appeals can and should be determined on the assumption that the majority's construction was correct. Each appeal arises from a separate decision of the Migration Review Tribunal which affirmed on review a separate decision of a delegate of the Minister purporting to cancel a student visa, a prescribed criterion for the grant of which was that the applicant met the definition of an "eligible higher degree student". An element of that definition, which can be described for ease of reference as "the enrolment element", required that, if a visa applicant proposed [2018] HCA 34. 2 Wei v Minister for Immigration and Border Protection (2015) 257 CLR 22 at 35 [33]; [2015] HCA 51. 3 Shrestha v Minister for Immigration and Border Protection (2017) 251 FCR 143 at to undertake another course of study before and for the purposes of a principal course of study, the visa applicant had to be enrolled in that other course4. The Tribunal in each case found that the holder of a student visa, who had been found to have met the enrolment element by reason of having been enrolled in a particular course at the time of grant of the visa, was no longer enrolled in that course. The Tribunal had then gone on in each case to consider whether a different course of study in which the visa holder had later enrolled satisfied the enrolment element, concluding in each case that the different course of study did not satisfy that element. Being satisfied that the decision to grant the student visa had been based in part on the "circumstance" of the applicant meeting the enrolment element and that that circumstance no longer existed, the Tribunal turned its attention to the exercise of discretion. Weighing the personal situation of the visa holder, the Tribunal concluded in each case that the student visa should be cancelled. Each decision of the Tribunal was challenged in an application for judicial review in the Federal Circuit Court. In each case, the application was dismissed by the Federal Circuit Court5. On appeal to the Full Court of the Federal Court, Bromberg and Charlesworth JJ found that the Tribunal had in each case misconstrued and misapplied the word "circumstances" in s 116(1)(a) by treating the relevant circumstance as fulfilment of the enrolment element of the definition instead of treating the relevant circumstance as enrolment in the particular course in which the visa holder was enrolled at the time of grant6. Given that the Tribunal was in each case satisfied that the visa holder was no longer enrolled in the particular course in which he or she had been enrolled at the time of grant, however, the majority found that the Tribunal's legal error had no effect on fulfilment of the precondition to the exercise of discretion. Together with Bromwich J, who dissented in relation to the construction of the word "circumstances" and who found no legal error in the reasoning of the Tribunal in relation to the precondition, Bromberg and Charlesworth JJ also found that treating the relevant circumstance as enrolment in the particular course could 4 Clause 573.111 of Sched 2 to the Migration Regulations 1994 (Cth). 5 Shrestha v Minister for Immigration and Border Protection [2016] FCCA 828; Ghimire v Minister for Immigration and Border Protection [2016] FCCA 1440; Acharya v Minister for Immigration and Border Protection [2016] FCCA 1240. (2017) 251 FCR 143 at 146 [8], 167 [108]. have had no effect on the findings which the Tribunal made or on the reasoning which the Tribunal adopted when it turned to the exercise of discretion. They concluded, therefore, that the Tribunal's legal error could have had no impact on the decisions which the Tribunal made in fact to cancel each visa7. Bromberg and Charlesworth JJ each characterised the Tribunal's legal error as a jurisdictional error, but treated the fact that the error could have had no impact on the Tribunal's decision as a reason to refuse relief as a matter of discretion8. Bromwich J indicated that he too would have refused relief as a matter of discretion had he considered the Tribunal to have erred9. For the reasons given in Hossain v Minister for Immigration and Border Protection, the fact that the postulated legal error could have had no impact on the Tribunal's decisions denied that error the character of a jurisdictional error. The postulated legal error at most led the Tribunal to ask a superfluous question. The Tribunal's reasons for decision in each case make perfectly clear that its treatment of the relevant circumstance (as meeting the enrolment element of the definition of an "eligible higher degree student", rather than as enrolment in the particular course in which the visa holder had been enrolled at the time of grant of the visa) did not impact on anything which the Tribunal otherwise did in finding facts and in reasoning to a conclusion as to the preferable exercise of discretion. For that reason, the postulated legal error could not have taken the decision of the Tribunal beyond the authority conferred on the Tribunal. The nature of the postulated legal error lends itself to analogy with cases in which a decision-maker has authority to exercise discretion but is mistaken as to the statutory source of that authority. The mistake as to the source of authority has consistently been held not to take the exercise of discretion beyond the statutory authority which the decision-maker actually has10 unless the mistake (2017) 251 FCR 143 at 148 [16]-[17], 170 [126]. (2017) 251 FCR 143 at 147-148 [11]-[18], 169-171 [121]-[128]. (2017) 251 FCR 143 at 153-155 [41]-[48]. 10 Eg Brown v West (1990) 169 CLR 195 at 203-204; [1990] HCA 7; Johns v Australian Securities Commission (1993) 178 CLR 408 at 426, 469; [1993] HCA leads the decision-maker to ignore statutory requirements which might have resulted in the exercise of the discretion being different had they been observed11. Each appeal is to be dismissed with costs. 11 Australian Education Union v Department of Education and Children's Services (2012) 248 CLR 1 at 16-17 [34]; [2012] HCA 3; Mercantile Mutual Life Insurance Co Ltd v Australian Securities Commission (1993) 40 FCR 409 at 412. Nettle Edelman Introduction Each appellant in these appeals was granted a Student (Temporary) (class TU) Higher Education Sector (subclass 573) visa under s 65 of the Migration Act 1958 (Cth). Delegates of the Minister cancelled the appellants' visas on substantively the same grounds. In each case, the Migration Review Tribunal ("the Tribunal") affirmed the delegate's decision and the Federal Circuit Court of Australia dismissed an application for judicial review. On appeal to the Full Court of the Federal Court of Australia, a majority held that the Tribunal had made a jurisdictional error but dismissed the appeals on the basis that the discretion not to issue writs of certiorari should have been exercised because the error could not have made any difference to the result. The appellants submitted that the Full Court erred by concluding that the discretion should have been exercised not to issue writs of certiorari. An issue of law raised by these appeals was dealt with on the appeal in Hossain v Minister for Immigration and Border Protection12, which was heard concurrently with them. In that case, it was held that an error of law that would have made no difference to the result is not generally a jurisdictional error. Absent a finding of jurisdictional error, a writ of certiorari cannot issue to quash a decision of the Tribunal13. However, these appeals should be resolved on a point that logically precedes that issue. By notice of contention, the Minister submitted that the appeals should be dismissed on the basis that the Tribunal made no error of law. That submission should be accepted. The appeals should be dismissed. The grant of visas to the appellants The criteria for the visa granted to the appellants were prescribed by Subclass 573 of Sched 2 to the Migration Regulations 1994 (Cth). Those criteria included cl 573.223(1)(b), which provided that the decision maker must be satisfied that the visa applicant meets the requirements of cl 573.223(1A) or Of these two possibilities, the appellants were granted visas under sub-cl (1A), which included a requirement that the applicant be an "eligible higher degree student". Clause 573.223 relevantly provided as follows: 12 [2018] HCA 34. 13 Migration Act 1958 (Cth), s 474; Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476 at 506 [76]-[77]; [2003] HCA 2. Nettle Edelman "(1A) If the applicant is an eligible higher degree student who has a confirmation of enrolment in each course of study for which the applicant is an eligible higher degree student: the applicant gives the Minister evidence that the applicant has: a level of English language proficiency that satisfies the applicant's eligible education provider; and educational qualifications required by the eligible education provider; and the Minister is satisfied that the applicant is a genuine applicant for entry and stay as a student, having regard to: the stated intention of the applicant to comply with any conditions subject to which the visa is granted; and any other relevant matter; and the Minister is satisfied that, while the applicant holds the visa, the applicant will have sufficient funds to meet: the costs and expenses required to support the applicant during the proposed stay in Australia; and the costs and expenses required to support each member (if any) of the applicant's family unit. If the applicant is not an eligible higher degree student, or does not have a confirmation of enrolment in each course of study for which the applicant is an eligible higher degree student: the applicant gives the Minister evidence in accordance with the requirements mentioned in Schedule 5A for the highest assessment level for the applicant; and the Minister is satisfied that the applicant is a genuine applicant for entry and stay as a student, having regard to: the stated intention of the applicant to comply with any conditions subject to which the visa is granted; and Nettle Edelman any other relevant matter; and the applicant will have access the Minister is satisfied that, while the applicant holds the funds visa, demonstrated or declared the requirements in Schedule 5A relating to the applicant's financial capacity." in accordance with the The definition of "eligible higher degree student" ("the EHDS definition"), contained in cl 573.111, was as follows: "eligible higher degree student means an applicant for a Subclass 573 visa in relation to whom the following apply: the applicant is enrolled in a principal course of study for the award a bachelor's degree; or a masters degree by coursework; the principal course of study is provided by an eligible education provider; if the applicant proposes to undertake another course of study before, and for the purposes of, the principal course of study: the applicant is also enrolled in that course; and that course is provided by the eligible education provider or an educational business partner of the eligible education provider." At the time the appellants received their visas, they satisfied each of criteria (a), (b), and (c) of the EHDS definition. All of them were enrolled in a principal course of study for the award of a bachelor's degree with an eligible education provider, and all of them proposed to undertake, and were enrolled in, a diploma course with an educational business partner of the eligible education provider before commencing their bachelor's degree course. One of the appellants, Mr Acharya, subsequently changed his enrolment to a different bachelor's degree and a different diploma but, at that time, he continued to satisfy criteria (a), (b), and (c) of the EHDS definition. It was not suggested on his appeal that anything turned upon this difference. Nettle Edelman The cancellation of the appellants' visas The appellants' studies were not a success. At the end of the first semester of the diploma courses, each appellant ceased to be enrolled in the diploma course although maintaining enrolment in the proposed, subsequent bachelor's degree. Delegates of the Minister cancelled the appellants' visas. At the relevant time, s 116(1)(a) of the Migration Act provided that, subject to sub-ss (2) and (3), which are not relevant to these appeals, "the [decision maker] may cancel a visa if he or she is satisfied that ... any circumstances which permitted the grant of the visa no longer exist". The Tribunal and the Federal Circuit Court The approach taken by the Tribunal to each appellant was effectively the same. The Tribunal's reasoning in relation to Mr Shrestha is illustrative. Mr Shrestha was granted a visa on the basis of his enrolment in a Bachelor of Information Technology with an eligible education provider (Deakin University) and a Diploma of Computing with an educational business partner of that provider (Melbourne Institute of Business & Technology). Mr Shrestha failed all of the units that he undertook in his Diploma of Computing. He then enrolled in cookery courses. The Tribunal held that although Mr Shrestha remained enrolled in the Bachelor of Information Technology at Deakin University, he ceased being "enrolled in another course of study before and for the purposes of the principal course of study and provided by an education[al] business partner of Deakin". The cookery courses in which he subsequently enrolled were not "before, and for the purposes of, the principal course of study" within criterion (c) of the EHDS definition. Nor did Mr Shrestha provide any evidence of enrolment in another course of study that was a pathway to the Bachelor of Information Technology in which he was enrolled. The Tribunal concluded as follows: "Accordingly, the Tribunal finds that [Mr Shrestha] is not an eligible higher degree student. He therefore does not satisfy the requirements of cl 573.223(1A) and a circumstance which permitted the grant of the visa no longer exists." The Tribunal held that the non-existence of a circumstance that permitted the grant of Mr Shrestha's visa enlivened the discretion under s 116(1)(a) of the Migration Act to cancel his visa. After considering the circumstances relevant to the exercise of the discretion to cancel the visa, the Tribunal held that it should be cancelled. The delegate's decision was therefore affirmed by the Tribunal. Nettle Edelman In each case, an application to the Federal Circuit Court for judicial review was dismissed. The Full Court The Full Court heard the three appeals together14. In their judgments, their Honours used the circumstances of Mr Shrestha to illustrate the common issues raised on the appeals. By a notice of contention, the Minister raised a legal issue that is logically anterior to a consideration of the particular grounds of appeal. That legal issue is whether the Tribunal had asked the wrong question when applying the test for cancellation of a visa under s 116(1)(a) of the Migration Act. In the Full Court, Charlesworth J (with whom Bromberg J relevantly agreed) held that the Tribunal had asked itself the wrong question and that a jurisdictional error had been established. However, their Honours dismissed the appeals on the basis that the outcome could not have been any different. As Charlesworth J correctly explained, the power under s 116(1)(a) of the Migration Act to cancel a visa if "any circumstances which permitted the grant of the visa no longer exist" directed attention on these appeals to each appellant's enrolment in the diploma course as the relevant circumstance upon which the visa was granted. Her Honour said, also correctly, that at the time of the cancellation decision Mr Shrestha was no longer enrolled in the diploma, so the power to cancel the visa was enlivened15. However, her Honour held that the Tribunal had erred by proceeding on the basis that the power to cancel Mr Shrestha's visa "turned upon whether or not he satisfied the EHDS definition and perhaps to a lesser extent, the criteria under cl 573.223(1A)"16. An example can illustrate her Honour's point about the difference between (i) a legal conclusion as to whether the EHDS definition is satisfied, and (ii) a factual conclusion as to whether the circumstances underlying the EHDS definition have changed. Suppose an applicant were granted a visa on the basis of enrolment to study for a bachelor's degree falling within criteria (a) and (b) of the EHDS definition. If the applicant failed the degree but, immediately prior to failure, enrolled in a different degree that satisfied criteria (a) and (b) of the EHDS definition, the applicant would continue to satisfy the EHDS definition and the ministerial discretion to cancel the applicant's visa would not be 14 Shrestha v Minister for Immigration and Border Protection (2017) 251 FCR 143. 15 (2017) 251 FCR 143 at 167 [108]. 16 (2017) 251 FCR 143 at 167-168 [109]. Nettle Edelman enlivened. The process might then be repeated in relation to the second degree. If the decision maker asked himself or herself only whether the EHDS definition was still satisfied, then he or she could not cancel the applicant's visa for this reason even though the factual circumstances that permitted the grant of the applicant's visa no longer existed. Charlesworth J considered that the Tribunal erred by focusing upon the more onerous standard for cancellation of whether Mr Shrestha had ceased to meet the EHDS definition, rather than by considering the circumstance of Mr Shrestha's enrolment in the diploma course, which enrolment had ceased to exist. Her Honour considered that this error by the Tribunal was a jurisdictional error. Nevertheless, the appeals were dismissed because her Honour considered that the more onerous test applied by the Tribunal meant that the outcome would not have been any different. Bromwich J also dismissed the appeals. However, his Honour did so because he concluded that the Tribunal had not made any error of law. At one point in his Honour's reasons, he described the enquiry for s 116(1)(a) in terms similar to those that Charlesworth J correctly said were erroneous: whether "the circumstance of each appellant being an EHDS no longer existed"17. However, the approach taken by his Honour to the issue raised by s 116(1)(a) of the Migration Act – whether circumstances which permitted the grant of the visa no longer exist – was to consider "the basis upon which each appellant met the criterion of being an EHDS at the time of each visa grant" and whether each appellant still met that basis at the time of considering cancellation18. "The correct approach, adopted by the Tribunal, was to consider how each of the appellants met the criterion of being an EHDS at the time of the grant of each visa; and how each no longer met that criterion, either by way of diploma enrolment at the time of each delegate's decision, or at all by the time of each Tribunal decision. The visa criterion did not change. A relevant circumstance of each appellant did change, such that they no longer met the visa criterion that existed at the time of the grant of each visa." 17 (2017) 251 FCR 143 at 152 [34]. 18 (2017) 251 FCR 143 at 152 [31]. 19 (2017) 251 FCR 143 at 152 [32]. Nettle Edelman The Tribunal did not make any error of law The approach taken by Bromwich J is correct. The requirement in s 116(1)(a) of the Migration Act – that the decision maker must be satisfied that "circumstances which permitted the grant of the visa no longer exist" – is concerned with factual circumstances. The criteria in the EHDS definition are factual circumstances that can permit the grant of a visa. Although the grant of the visa also requires, by cl 573.223(1)(b) of the Migration Regulations, that the decision maker must be satisfied that the visa applicant meets the requirements of either cl 573.223(1A) or cl 573.223(2), and although a state of mind is capable of being a fact, it was properly common ground on these appeals that a "circumstance" in s 116(1)(a) does not include the ministerial state of mind. In other words, s 116(1)(a) is not to be construed as though it applied to "ministerial satisfaction about ministerial satisfaction"20, ie if the Minister is satisfied that the Minister is satisfied that the requirements of cl 573.223 no longer apply. The approach taken by the Tribunal in each case was not to focus upon the EHDS definition divorced from its underlying circumstances or basis. Rather, as Bromwich J explained, the Tribunal, correctly, considered whether the criteria in the EHDS definition that permitted the grant of the visa no longer existed. As explained above in relation to Mr Shrestha, the Tribunal concluded that the circumstances that permitted the grant of his visa, as with the other appellants, included the satisfaction of the facts in criterion (c) of the EHDS definition. Like the other two appellants, Mr Shrestha satisfied those facts at the time of the grant of his visa but did not do so at the time of cancellation of his visa. At the time of cancellation a circumstance that permitted the grant of his visa no longer existed. Conclusion The conclusion that the Tribunal made no error of law, and therefore could not have committed a jurisdictional error, is sufficient to uphold the notice of contention. Each appeal must be dismissed with costs. 20 Minister for Immigration and Multicultural Affairs v Zhang (1999) 84 FCR 258 at

HIGH COURT OF AUSTRALIA Matter No S77/2016 AND PLAINTIFF AUSTRALIAN ELECTORAL OFFICER FOR THE STATE OF SOUTH AUSTRALIA & ANOR DEFENDANTS Matter No S109/2016 PETER JAMES MADDEN & ORS PLAINTIFFS AND AUSTRALIAN ELECTORAL OFFICER FOR THE STATE OF TASMANIA & ORS DEFENDANTS Day v Australian Electoral Officer for the State of South Australia Madden v Australian Electoral Officer for the State of Tasmania [2016] HCA 20 13 May 2016 S77/2016 & S109/2016 ORDER Matter No S77/2016 Application dismissed. The plaintiff pay the second defendant's costs of the application. Matter No S109/2016 Application dismissed. The plaintiffs pay the eighth defendant's costs of the application. Representation P E King with F C Brohier for the plaintiff in S77/2016 (instructed by McKells Solicitors) P E King for the plaintiffs in S109/2016 (instructed by McKells Solicitors) Submitting appearance for the first defendant in S77/2016 Submitting appearance for the first to seventh defendants in S109/2016 N J Williams SC with N J Owens and C L Lenehan for the second defendant in S77/2016 and the eighth defendant in S109/2016 (instructed by Australian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Day v Australian Electoral Officer for the State of South Australia Madden v Australian Electoral Officer for the State of Tasmania Constitutional law – Election of Senators – Validity of provisions of Commonwealth Electoral Act 1918 (Cth) as amended by Commonwealth Electoral Amendment Act 2016 (Cth) – Whether provisions for voting above or below dividing line on ballot paper prescribed more than one method of choosing Senators contrary to s 9 of Constitution – Whether indicating vote for party or group above dividing line contrary to requirement in s 7 of Constitution that Senators be "directly chosen by the people" – Whether prescription of "Droop quota" resulted in effective disenfranchisement – Whether instructions on ballot paper infringed implied freedom of political communication or system of representative government. Words and phrases – "above the line", "ballot paper", "below the line", "directly chosen by the people", "dividing line", "Droop quota", "free and informed vote", "group voting ticket", "method of choosing senators", "preferential voting". Constitution, ss 7, 9 and 24. Commonwealth Electoral Act 1918 (Cth), ss 4(1), 123, 124, 126, 168, 169, 209(1), 210, 214, 214A, 239, 268, 268A, 269, 272 and 273. FRENCH CJ, KIEFEL, BELL, GAGELER, KEANE, NETTLE AND Introduction Two applications have been brought in the original jurisdiction of the Court challenging the validity of provisions of the Commonwealth Electoral Act 1918 (Cth) ("the Act") as amended by the Commonwealth Electoral Amendment Act 2016 (Cth) ("the Amendment Act"). The challenged provisions concern the new form of the Senate ballot paper and the process for marking it. The new process requires an elector to number sequentially at least six squares above the dividing line on the ballot paper. A group of candidates may be granted a square above the line on request. Where a group of candidates has so requested, the name of the political party that endorsed them and the party logo will appear adjacent to the square above the line. The numbering of squares above the line indicates the elector's preference for the candidates in the first numbered group or party in the order in which they appear below the dividing line, followed by the candidates of the second numbered group or party and so on up to the number of the elector's choices. The new process also requires electors who wish to vote below the dividing line to number at least 12 candidates in the order of their preference. The plaintiff in application S77 of 2016 is a Senator for the State of South Australia. The first plaintiff in application S109 of 2016 is a candidate for the next Senate election in Tasmania. Each of the remaining six plaintiffs in that application is an elector for one of the States or Territories other than South Australia and Tasmania. The plaintiffs rely principally upon ss 7 and 9 of the Constitution. Section 7 of the Constitution provides that the Senate "shall be composed of senators for each State, directly chosen by the people of the State, voting, until the Parliament otherwise provides, as one electorate." Section 9 provides that the Parliament of the Commonwealth may make laws "prescribing the method of choosing senators, but so that the method shall be uniform for all the States." It also provides that "[s]ubject to any such law, the Parliament of each State may make laws prescribing the method of choosing the senators for that State." The plaintiffs seek declarations and writs of mandamus and prohibition directed to the Australian Electoral Officers for the States and Territories and to the Commonwealth. They contend that the new form of ballot paper and the Bell Nettle Gordon alternative means for marking it above and below a dividing line constitute a prescription of more than one method of choosing Senators, contrary to s 9 of the Constitution. They separately contend that by allowing electors to indicate a vote for a party or group designated above the line on the ballot paper, the Act departs from the requirement in s 7 that Senators will be "directly chosen by the people". The basis for that argument is that a vote above the line is a vote for the relevant group or party as an intermediary and not a direct choice of named candidates. They further argue that the interaction of those provisions with the prescription of a quota of votes upon which a candidate will be taken to have been elected infringes effectively disenfranchises some electors. The plaintiffs also submit that the ballot form now prescribed misleads electors about their voting options and thereby infringes the implied freedom of political communication. The impugned sections of the Act are also said, in a general way, to have detracted from the franchise for no substantial reason and to be invalid on that account. a principle of proportional representation and For the reasons that follow, those submissions should not be accepted. The applications should be dismissed with costs. It is useful to refer briefly to the legislative history of voting processes for the Senate which preceded the challenged amendments. A brief history of Senate voting processes The recent amendments to the Act form the latest episode in an historical evolution of the voting methods and procedures for Senate elections since Federation. The Commonwealth Electoral Act 1902 (Cth) ("the 1902 Act") provided for a "first past the post" system for the election of Senators. Each elector had a number of votes equal to the number of vacancies and marked a cross in the square opposite the name of the candidates for whom they voted1. The candidates with the greatest number of votes were elected to the available vacancies2. That system was replicated in the Act when enacted in 19183. 1 1902 Act, s 150. 2 1902 Act, s 161. 3 Act, ss 123 and 135(7). Bell Nettle Gordon The Act was amended in 19194 to provide for the first time for preferential voting for Senate elections. Each elector was required to express preferences for twice the number of candidates to be elected plus one5. Candidates would be excluded and their preferences distributed until one candidate achieved an absolute majority of unexhausted ballots6. That candidate would win the first seat. The further preferences of the first successful candidate's vote would be distributed among the remaining candidates followed by a count for the second vacancy. Candidates would be excluded and preferences distributed until a second candidate achieved an absolute majority of the unexhausted ballots. That candidate would win the second seat. The distribution of preferences would continue until sufficient successful candidates were identified to fill all vacancies. A procedure under which candidates could be grouped on a Senate ballot paper was introduced into the Act in 19227. Grouped candidates were given priority over ungrouped candidates in the printing of ballot papers8. Candidates within groups were arranged in alphabetical order and the ordering of the groups was alphabetical9. The groups were identified on the ballot paper not by party names but by letters depending upon their position on the ballot paper, thus A for the first group and B for the second group and so on10. 4 Commonwealth Electoral Act 1919 (Cth) ("the 1919 Act"). 5 Act, s 123(a) as inserted by the 1919 Act, s 7. 6 Act, s 135 as inserted by the 1919 Act, s 9. 7 Commonwealth Electoral Act 1922 (Cth) ("the 1922 Act"). 8 Act, s 105A(a) as inserted by the 1922 Act, s 11. 9 Act, s 105A(b) and (c) as inserted by the 1922 Act, s 11. 10 Act, s 105A(d) as inserted by the 1922 Act, s 11. Bell Nettle Gordon Compulsory voting was introduced in 192411. A further amendment in 1934 required electors to express sequential preferences for all candidates on a Senate ballot paper12. The counting rules remained the same. In 1940, the Act was again amended so that a group of candidates could choose the order in which the names of candidates within the group were listed on the ballot paper13. The ordering of the groups on the ballot paper was done by ballot rather than alphabetically14. Ungrouped candidates were ordered by ballot15. Candidates were grouped in columns for the first time16. Proportional representation was introduced in 194817. Full preferential voting was retained. To be elected a candidate had to receive a specified proportion (or quota) of the total number of formal votes. That quota was calculated by dividing the total number of formal votes by one more than the number of candidates and adding one. In a half-Senate election for six vacancies, the required quota would be one-seventh of the total number of votes plus one18. This is known as the "Droop quota"19. Each elector had a single vote, which would be transferable in accordance with the elector's preferences. If a candidate were elected and had more votes than the quota then a surplus vote would 11 Commonwealth Electoral Act 1924 (Cth). 12 Commonwealth Electoral Act 1934 (Cth), s 8 amending s 123 of the Act. 13 Act, s 72B as inserted by the Commonwealth Electoral Act 1940 (Cth) ("the 1940 Act"), s 7. 14 Act, s 105A(c) as inserted by the 1940 Act, s 17. 15 Act, s 105A(e) as inserted by the 1940 Act, s 17. 16 1940 Act, s 26 replacing Form E in the Schedule to the Act. 17 Commonwealth Electoral Act 1948 (Cth) ("the 1948 Act"). 18 Act, s 135(5)(b) and (c) as inserted by the 1948 Act, s 3. 19 Named after London barrister and mathematician HR Droop, who first proposed the quota in 1868. See Tideman, "The Single Transferable Vote", (1995) 9 The Journal of Economic Perspectives 27 at 30. Bell Nettle Gordon transfer to the elector's next preferred candidate still alive in the count. Unlike the previous system, it would not be transferred as a whole vote but at a fractional "transfer value"20. An excluded candidate would have his or her votes distributed in accordance with preferences21. In the Second Reading Speech for the 1948 amendments Dr HV Evatt said22: "The great defect, from the representation aspect, of both the old 'first past the post' and the more recently used 'block majority' system is that at an election, generally all seats in a State are won by candidates of the one party, leaving a minority of between 40 to 50 per cent of the electors without any representation at all in the Senate." Registration of political parties, the printing of their names on ballot papers, group voting tickets and the division of the ballot paper by a line allowing the option of above the line voting for political parties or groups and below the line voting for individual candidates were introduced in 198323. Under that system an elector could mark a square designated by reference to a particular political party or group above the line and thereby cast a vote for all candidates according to preferences for that election set out on a group voting ticket lodged with the Australian Electoral Commission and displayed at the polling booth on a poster24. The operation of these provisions as they existed immediately prior to the 2016 amendments is explained later in these reasons. The Joint Select Committee on Electoral Reform in 1983 recommended the adoption of the group ticket voting option because of the high rate of 20 Act, s 135(5)(e)-(g) as inserted by the 1948 Act, s 3. 21 Act, s 135(5)(i) as inserted by the 1948 Act, s 3. 22 Australia, House of Representatives, Parliamentary Debates (Hansard), 16 April 23 Commonwealth Electoral Legislation Amendment Act 1983 (Cth) ("the 1983 Act"), which commenced on 21 February 1984. 24 Act, s 107A as inserted by the 1983 Act, s 82. An option to provide a pamphlet of group voting tickets was later provided by s 216 of the Act as amended by the Electoral and Referendum Amendment Act (No 1) 2001 (Cth), s 36. Bell Nettle Gordon unintentional error, resulting in informality, brought about by requiring electors to express preferences for all candidates on a Senate ballot paper25. The rules for below the line votes for individual candidates were also amended to allow for a limited number of sequencing errors by the elector without the vote being treated as informal26. Although ballot papers were divided by a line and provided for group voting above that line and individual voting below it, neither of the terms "above the line" or "below the line" featured prominently in the Act prior to the 2016 amendments27. The 1983 amendments also changed the ways in which transfer values were calculated and assigned for Senate candidates with a surplus. Under the new method, if a candidate achieved an above-quota surplus, all of that candidate's ballot papers, not only the surplus, would be transferred to other candidates at a fractional value28. In proposing and explaining that change the Joint Select Committee on Electoral Reform observed in September 1983 that the earlier transfer system provided for a transfer only of a candidate's surplus ballot papers, which might be an unrepresentative sample of their actual ballot papers. The Committee also observed that for candidates who achieved a surplus following the distribution of preferences their first preference votes could not be included in a subsequent transfer29. The new system was consistent with the Committee's recommendations30. 25 Joint Select Committee on Electoral Reform, First Report, (1983) at 62 [3.23]. 26 Act, s 133B(1) as inserted by the 1983 Act, s 103. 27 Section 273A of the Act, prior to the Amendment Act, concerned how the Divisional Returning Officer was to deal with informal "wholly above-the-line ballot papers". It defined that term as a ballot paper that has one or more ticks, crosses or other marks above the dividing line and no marks below the dividing line: Act, s 273A(10). No other mention was made of "above the line" voting. 28 Act, s 135(5)-(28) as inserted by the 1983 Act, s 105(f). 29 Joint Select Committee on Electoral Reform, First Report, (1983) at 57-58 [3.11]. 30 Joint Select Committee on Electoral Reform, First Report, (1983) at 65 [3.34]. Bell Nettle Gordon In 1987, the Act was further amended to allow for incumbent and ungrouped Senators to lodge individual voting tickets setting out preferences for all candidates31. It entitled any such Senator who lodged a ticket to have a square above the line. Non-incumbent ungrouped candidates remained unable to have above the line squares or to lodge voting tickets32. Registered political parties and party designations The form of the ballot paper before and after the Amendment Act must be understood in the light of the continuing provisions for the registration of political parties and the process by which party designations are recognised on the ballot paper. The relevant provisions have not been materially altered by the Amendment Act. Part XI of the Act provides for the registration of "eligible political parties". Section 124 provides that "[s]ubject to this Part, an eligible political party may be registered under this Part for the purposes of this Act." The term "Political party" is defined in s 4(1) of the Act as: "an organization the object or activity, or one of the objects or activities, of which is the promotion of the election to the Senate or to the House of Representatives of a candidate or candidates endorsed by it." An "eligible political party" is defined in s 123(1) as a political party that: either: is a Parliamentary party; or has at least 500 members; and is established on the basis of a written constitution (however described) that sets out the aims of the party." 31 Commonwealth Electoral Amendment Act 1987 (Cth) ("the 1987 Act"). 32 Act, s 211A as inserted by the 1987 Act, s 26. Bell Nettle Gordon The term "Parliamentary party" is also defined in s 123(1) as "a political party at least one member of which the Commonwealth." Applications for registration of a political party are made to the Electoral Commission33, which maintains a Register of Political Parties34. the Parliament of is a member of The Act provides for the grouping of candidate names on Senate ballot papers pursuant to requests made under s 168. Section 168(1) provides that: "Two or more candidates for election to the Senate may make a joint request: that their names be grouped in the ballot papers; or that their names be grouped in the ballot papers in a specified order." In printing ballot papers for a Senate election the names of candidates who made requests under s 168(1) shall be printed in groups on the ballot paper in accordance with their requests and before the names of candidates who have not made such requests35. The ordering of the groups is determined by the Australian Electoral Officer under a ballot process36. Section 169(1) provides for a request by the registered officer of a registered political party that the name or registered abbreviation of the name of that party be printed on the ballot papers for an election adjacent to the name of a candidate who has been endorsed by that party37. Section 214 provides for the printing of political party names on the ballot papers. 33 Act, s 126. 34 Act, s 125. 35 Act, s 210(1)(a). 36 Act, s 213. 37 "Registered abbreviation" is defined in s 210A(1). In relation to the name of a registered political party it means the abbreviation (if any) of the name of the party entered in the Register of Political Parties. Bell Nettle Gordon The provisions for registration of political parties and their limitation to parties of at least 500 members were held in Mulholland v Australian Electoral Commission38 not to infringe the requirements of ss 7 and 24 of the Constitution that Senators and Members of the House of Representatives be "directly chosen by the people". Gleeson CJ observed of the rules for the printing of ballot papers39: "Here, the rules in question preserve a full and free choice between the competing candidates for election. The electors are presented with a true choice. The available alternatives between candidates are set out on the ballot paper. The process of choice by electors is not impeded or impaired." McHugh J in the same case pointed to the extent to which the Constitution leaves it to the Parliament to determine the matter of electoral systems, including specification of particular voting methods such as preferential or proportional voting or first past the post voting40. In a similar vein, Gummow and Hayne JJ observed that care is called for in elevating a "direct choice" principle to a broad restraint upon legislative development of the federal system of representative government41. Those general observations weigh against the plaintiffs' arguments in this case. Group ticket voting Section 169(4), as it stood before the Amendment Act, provided that where a request had been made under s 169(1) for the printing of a political party name or registered abbreviation of a party name on the ballot papers, and where the candidates proposed to have a group voting ticket registered, they could further request that the name of the registered political party that endorsed the 38 (2004) 220 CLR 181; [2004] HCA 41. 39 (2004) 220 CLR 181 at 192 [18]. 40 (2004) 220 CLR 181 at 207 [64]. 41 (2004) 220 CLR 181 at 237 [156]. Bell Nettle Gordon candidates be printed on the ballot papers adjacent to the square printed in relation to the group above the dividing line. The concept of a "group voting ticket" was explained in s 211 and provision made for it in ss 211, 211A and 216, each of which has been repealed by the Amendment Act. Candidates grouped pursuant to a request under s 168 could lodge a written statement with the Australian Electoral Officer that they wished electors to indicate their preferences in relation to all the candidates in the election in up to three alternative orders of preference specified in their statement42. Those orders would give preferences to the candidates lodging the statement before any other candidate. Where a group of candidates had at least one group voting ticket registered for the purposes of that election, a square was required to be printed on the ballot papers for use in the election above the names of those candidates (ie, above the dividing line)43. An ungrouped candidate, who was a sitting Senator, could also lodge with the Australian Electoral Officer a written statement of up to three orders of preference (an "individual voting ticket")44. Section 216, prior to the Amendment Act, provided for the display at polling booths of either or both of a poster showing the tickets and a pamphlet showing the tickets. It also prescribed the layout of the posters and pamphlets. The system for group ticket voting above the line was held valid by Gibbs CJ in McKenzie v The Commonwealth45. The plaintiff in that case was a candidate for election as a Senator for the State of Queensland. He sought a declaration that the provisions of the Act authorising the use of a ballot paper providing for above the line group ticket voting were invalid. Gibbs CJ observed46: 42 Act, s 211(1) and (2) prior to repeal by the Amendment Act. 43 Act, s 211(5) prior to repeal by the Amendment Act. 44 Act, s 211A(1) and (2) prior to repeal by the Amendment Act. 45 (1984) 59 ALJR 190; 57 ALR 747; [1984] HCA 75. 46 (1984) 59 ALJR 190 at 191; 57 ALR 747 at 749. Bell Nettle Gordon "[I]t is not right to say that the Constitution forbids the use of a system which enables the elector to vote for the individual candidates by reference to a group or ticket." The Chief Justice went on to observe that political parties existed long before the Constitution was adopted and that there was no reason to imply an inhibition on the use of a method of voting which recognised political realities provided that the Constitution itself did not contain any indication that such a method was forbidden47. He also rejected an argument that the provisions offended general principles of justice by discriminating against candidates who were not members of established parties or groups. The Chief Justice quoted the words of Stephen J in Attorney-General (Cth); Ex rel McKinlay v The Commonwealth48: "[I]t is not for this Court to intervene so long as what is enacted is consistent with the existence of representative democracy as the chosen mode of government and is within the power conferred by s 51(xxxvi) [of the Constitution]." "[I]t cannot be said that any disadvantage caused by the [impugned provisions] to candidates who are not members of parties or groups so offends democratic principles as to render the sections beyond the power of the Parliament to enact." Similar challenges have been rejected by single Justices of the Court in Abbotto v Australian Electoral Commission50, McClure v Australian Electoral 47 See also discussion of the party political system in Mulholland v Australian Electoral Commission (2004) 220 CLR 181 at 196 [29] per Gleeson CJ, 213-214 [78] per McHugh J, 237 [155] per Gummow and Hayne JJ. 48 (1975) 135 CLR 1 at 57-58; [1975] HCA 53 quoted in (1984) 59 ALJR 190 at 191; 57 ALR 747 at 749. 49 (1984) 59 ALJR 190 at 191; 57 ALR 747 at 749. 50 (1997) 71 ALJR 675; 144 ALR 352; [1997] HCA 18. Bell Nettle Gordon Commission51 and Ditchburn v Australian Electoral Officer (Qld)52. In the latter case it was unsuccessfully contended that above the line voting for a group ticket was contrary to the requirement that members of the Senate be "directly chosen" by the people53. The pre-amendment Senate ballot paper Section 209(1) provides that "[b]allot papers to be used in a Senate election shall be in Form E in Schedule 1." Prior to the Amendment Act Form E appeared as set out in Annexure 1 to these reasons. It comprised two parts divided by a thick black line. Each of the squares above the line was designated with the name of a registered political party or the word "Independent". An elector could cast a vote by ticking one of those squares to indicate "the voting ticket you wish to adopt as your vote". That is to say, the elector adopted the preferential voting sequence of that particular party or independent as his or her own voting preference without having to fill out any further squares. The squares below the line set out the name of each candidate and the registered political party to which that candidate belonged or the term "Independent" if there were no relevant registered political party. Independent candidates were located under the heading "Ungrouped" on the right of the ballot paper. Section 239(1) provided, before the Amendment Act, that an elector should mark his or her vote on the Senate ballot paper by: "(a) writing the number 1 in the square opposite the name of the candidate for whom the person votes as his or her first preference; and (b) writing the numbers 2, 3, 4 (and so on, as the case requires) in the squares opposite the names of all the remaining candidates so as to indicate the order of the person's preference for them." 51 (1999) 73 ALJR 1086; 163 ALR 734; [1999] HCA 31. 52 (1999) 165 ALR 147; [1999] HCA 40. 53 (1999) 165 ALR 147 at 148 [3], 149-150 [5]. Bell Nettle Gordon Alternatively, an elector could vote according to a group voting ticket. Section 239(2) provided that a vote could be marked on a ballot paper by writing the number 1 in a square (if any) printed on the ballot paper where a group of candidates or an individual candidate (as the case may be) had lodged a statement of a group or individual voting ticket. The vote would then be taken as a vote for all candidates in the order set out in the relevant group or individual voting ticket54. The provisions giving effect to group ticket voting were repealed by the Amendment Act. Amendments affecting the form and marking of the Senate ballot paper The Amendment Act amended the form of the Senate ballot paper to the new Form E appearing in Annexure 2 to these reasons. Like its predecessor, it comprises two parts separated by a thick black dividing line. As noted above, s 169(1) provides that the registered officer of a registered political party may request that its name or registered abbreviated name be printed on the ballot paper adjacent to the name of a candidate endorsed by that party. Section 214(1) provides for the printing of the registered party name or abbreviation on the ballot paper adjacent to the candidate's name. The amended s 169(4) provides that where such a request is made in respect of candidates at a Senate election and the candidates have asked to be grouped in the ballot paper under s 168, a further request may be made for the name of the registered political party that endorsed the candidates to be printed on the ballot paper adjacent to the square printed above the line in relation to the group. Section 214(2)(d) provides for the registered name of the party to be printed on the ballot paper adjacent to that square. Section 126 of the Act as amended provides for an application for registration of a political party to optionally include a logo of the party to be entered into the Register55. The Act as amended also provides, by s 214A, for the printing of a party logo adjacent to the name of the party on the ballot paper56. The terms "above the line" and "below the line" are now defined in s 4(1) of the Act. Thus, a square is printed "above the line" on a ballot paper if printed in accordance with s 210(1)(f)(ii) and "below the line" if printed in accordance 54 Act, s 272. 55 Act, s 126(2)(ba). 56 Act, s 214A(2). Bell Nettle Gordon with s 210(1)(f)(i). Section 210(1)(f), introduced by the Amendment Act, provides: "except as otherwise provided by the regulations: a square must be printed opposite the name of each candidate; and for candidates who made a request under section 168 that their names be grouped in the ballot papers for the election—a square must be printed above the dividing line and above the squares printed opposite those names." The term "dividing line" is defined as "the line on a ballot paper that separates the voting method described in subsection 239(1) from the voting method described in subsection 239(2)."57 Subsections (1) and (2) of s 239 now provide: "Voting below the line Subject to subsection (2), a person must mark his or her vote on the ballot paper in a Senate election by: (a) writing at least the numbers 1 to 12 in the squares printed on the ballot paper below the line (with the number 1 being given to the candidate for whom the person votes as his or her first preference, and the numbers 2, 3, 4 and so on to at least the number 12 being given to other candidates so as to indicate the order of the person's preference for them); or if there are 12 or fewer squares printed on the ballot paper below the line—numbering the squares consecutively from the number 1 (in order of preference as described in paragraph (a)). 57 Act, s 4(1). Prior to the Amendment Act, a nearly identical definition appeared in s 273A(10), the sole difference being that the subsection referred to "the ballot paper" as opposed to "a ballot paper". Bell Nettle Gordon Voting above the line (2) A vote may be marked on a ballot paper by: (a) writing at least the numbers 1 to 6 in the squares (if any) printed on the ballot paper above the line (with the number 1 being given to the party or group for whom the person votes as his or her first preference, and the numbers 2, 3, 4, 5 and 6 being given to other parties or groups so as to indicate the order of the person's preference for them); or if there are 6 or fewer squares printed on the ballot paper above the line—numbering the squares consecutively from the number 1 (in order of preference as described in paragraph (a))." The use of the term "voting method" in the definition of "dividing line" was said by the plaintiffs to indicate that the Act prescribed two methods of choosing Senators, contrary to s 9 of the Constitution. That argument can be dismissed immediately. The construction of the constitutional term "method", and its application, is not determined by the use of that word in the Act. Section 272, prior to the Amendment Act, provided for Senate ballot papers marked above the line to be taken to have been marked according to group voting tickets. The new s 272 applies if one or more numbers are written in the squares printed on the ballot paper above the line in relation to groups of candidates (each group being a "preferenced group"). Under s 272(2) the ballot paper is then taken to have been marked as if: each candidate in a preferenced group was given a different number starting from 1; and candidates in a preferenced group were numbered consecutively starting with the candidate whose name on the ballot paper is at the top of the group to the candidate whose name is at the bottom; and the order in which candidates in different preferenced groups are numbered is worked out by reference to the order in which the groups were numbered on the ballot paper, starting with the group marked 1; and Bell Nettle Gordon (d) when all the candidates in a preferenced group have been numbered, the candidate whose name is at the top of the next preferenced group is given the next consecutive number." The effect of a number written in a square printed on the ballot paper above the line is a vote for the group of candidates appearing below the line in the order in which they appear, in accordance with the group's position in the elector's order of preferences, above the line. Formal and informal ballot papers Section 268 provides for the circumstances in which ballot papers will be treated as informal. Prior to the Amendment Act, s 268(1)(b) provided that a vote for the Senate would be treated as informal if the ballot paper had no vote indicated on it, or it did not indicate the elector's first preference for one candidate and the order of his or her preference for all the remaining candidates. The new par (b) provides for a ballot paper to be treated as informal if: "subject to sections 268A and 269, in a Senate election, it has no vote indicated on it, or it does not indicate the voter's first preference for 1 candidate and then consecutively number at least 11 other candidates in the order of his or her preference". The new s 268A provides line. Section 268A(1) is a vote saving provision. It provides that a ballot paper in a Senate election is not informal under s 268(1)(b) if: formal votes below the for the voter has marked the ballot paper in accordance with paragraph 239(1)(b); or if there are more than 6 squares printed on the ballot paper below the line—the voter has consecutively numbered any of those squares from 1 to 6 (whether or not the voter has also included one or more higher numbers in those squares)." As noted earlier, s 239(2) provides that a vote above the line is effected by writing in at least the numbers 1 to 6 in the party or group squares (if any) appearing there. If there are fewer than six squares then all squares should be marked. Section 269(1), like s 268A(1), is a vote saving provision. It provides that a ballot paper is not informal under s 268(1)(b) if the elector has marked it in accordance with s 239(2) or has marked the number 1 or the number 1 and one or Bell Nettle Gordon more of the higher numbers in squares printed on the ballot paper above the line. This means that a formal above the line vote can be cast by marking just one of the squares with the number 1. The scrutiny Section 273 of the Act provides for the scrutiny, or counting, of votes in Senate elections. No amendments relevant to the present case were made to the section by the Amendment Act58. Section 273(8) and following are the key provisions setting out the process for the counting of votes. Section 273(8) provides for the calculation of the "Droop quota" discussed above. Any candidate who receives a number of first preference votes equal to or greater than the quota will be elected immediately. The number of votes of each elected candidate in excess of the quota (the "surplus") is then transferred at a proportionate rate (the "transfer value") in accordance with preferences59. As surplus votes are transferred, more candidates may reach the quota and be elected. However, if none of the remaining candidates reach the quota, the candidate with the lowest number of votes is excluded from the count and his or her votes are distributed based on preferences60. If a candidate obtains a quota following this process, his or her surplus votes will be transferred at the transfer value to the remaining candidates61 and the process of transfer, exclusion and distribution continues until all vacancies are filled. If at any stage the number of 58 Items 29 and 30 of Sched 1 to the Amendment Act made adjustments to the procedures followed by the Divisional and Assistant Returning Officer after the receipt of the ballot papers and provided for the use of containers rather than parcels to transmit ballot papers. The method for the calculation of the quota, the transfer value and the determination of which candidates are to be elected remain the same as before the amendments. 59 Act, s 273(9). 60 Act, s 273(13). 61 Act, s 273(14). Bell Nettle Gordon continuing candidates is equal to the number of remaining vacancies, those candidates are elected62. The plaintiffs' arguments The plaintiffs' arguments may be summarised as follows: The option of "optional first past the post/preferential" voting for parties above the line and "compulsory preferential" voting for candidates below the line, for which the Act now provides, constitutes more than one method of choosing Senators and is contrary to the requirement in s 9 of the Constitution that there be only one method. The option of above the line voting for one or more registered parties or groups contravenes the requirement in s 7 of the Constitution that Senators for each State be "directly chosen by the people". The changes to the form of ballot paper and the provisions for marking it above the line, read with s 273(8) of the Act, infringe a constitutional requirement of "directly proportional representation" in the Senate. The new form of ballot paper and the instructions on it are likely to mislead or deceive electors in relation to the casting of votes and thereby to hinder or interfere with their exercise of a right to a free and informed vote. It describes only two ways of voting and suppresses disclosure of other ways of voting which are formal. The new form of ballot paper mandates an uninformed choice by electors, preventing the free flow of information and hence impairing the implied freedom of political communication and the system of representative government. Arguments A, B and C sought to challenge features of the system that have existed since at least 1983. Argument D is directed at the form of the ballot paper. Argument E is a "catch all" submission. None of the above arguments has any merit and each can be dealt with briefly. 62 Act, s 273(18). Bell Nettle Gordon Argument A: The method of choosing Senators The first argument advanced by the plaintiffs involved the following propositions: Section 9 of the Constitution refers to one method of choosing Senators which shall be uniform for all the States. There are two methods prescribed pursuant to the Act as amended. One is an above the line "party list method", the other is a below the line "candidate list method". The characterisation of the two voting processes as two methods is supported by the new definition of "dividing line", which appears in s 4(1) of the Act, as a line which "separates the voting method described in subsection 239(1) subsection 239(2)." That argument has been rejected earlier in these reasons63. voting method described from the The Act as amended authorises a first past the post vote for a registered political party listed above the line on the ballot paper because it treats as formal a vote for just one of those parties. The difference in voting methods is substantial, not just formal. The term "method of choosing senators" appearing in s 9 of the Constitution entered the constitutional drafting process at the Melbourne Convention in March 1898 at the suggestion of the Convention's Drafting Committee. Clause 10 of the draft, which later became s 9 of the Constitution, had provided up to that time for the Parliament of the Commonwealth to make laws prescribing "the times, the places, and a uniform manner of choosing the senators" and for the Parliament of each State, subject to such laws, similarly to "determine the time, place, and manner of choosing the senators for that State." Bell Nettle Gordon The amendment appearing on the draft, in the hand of Robert Garran, substituted what became the language of s 9 of the Constitution64. The use of the term "method" instead of "manner" was suggested by Alfred Deakin at the Adelaide Convention in April 1897. As a result of interventions by Isaac Isaacs and Edmund Barton, Deakin was concerned that the word "manner" might not be wide enough to cover an alteration in the system of voting if so desired. He said65: "If 'manner' relates rather to the conduct of an election and the general provisions made for taking votes, is it wide enough to cover also, and to a certainty, a variety of systems of voting which might perhaps be indicated by the word 'method'? Would it not be desirable to take care that those States which think fit to adopt a system of proportional voting for the representation of minorities shall have power to do so, and that the Parliament of the Federal Commonwealth shall also be able to adopt such a system if it thinks desirable?" The debate was inconclusive but it was the change of wording suggested by Deakin which was subsequently effected through the Drafting Committee in the dying days of the Melbourne Convention in 1898. Against that background it is not surprising that Quick and Garran observed in their Annotated Constitution66: "[T]he power to prescribe the method of choosing senators extends to the regulation of the whole process of election, including the mode of nomination, the form of writs and ballot papers, the mode of voting, the mode of counting votes, &c. The section would thus enable the State Parliaments provisionally, and the Federal Parliament ultimately, to 64 Williams, The Australian Constitution: A Documentary History, (2005) at 1012- 1013 and see commentary at 802. 65 Official Report of the National Australasian Convention Debates, (Adelaide), 15 April 1897 at 673. 66 Quick and Garran, The Annotated Constitution of the Australian Commonwealth, Bell Nettle Gordon prescribe the mode in which an elector should record his vote, eg, whether he should vote for as many candidates as there are vacancies to be filled at the election, or whether he should have the option of 'plumping' for a less number of candidates or of concentrating his vote, or whether he should mark some or all of the candidates in the order of his preference." The Commonwealth argued for a broad construction of the term "method" along the lines of that set out in Quick and Garran's commentary. The Commonwealth drew attention to the reference in the quoted passage to the elector's "option of 'plumping' for a less number of candidates or of concentrating his vote". As the Commonwealth submitted, the authors there referred expressly to the possibility of an electoral system involving the option of voting in two quite distinct ways. The plaintiffs contended for a narrower construction but did not say what that construction was save that the single method did not embrace the options of above the line and below the line voting offered to electors under the Act. As the Commonwealth submitted, the evident purpose of s 9 was to provide for a method of choosing Senators uniform across the States. "Method" is a constitutional term to be construed broadly allowing for more than one way of indicating choice within a single uniform system. What the plaintiffs contended for is a pointlessly formal constraint on parliamentary power to legislate in respect of Senate elections which has nothing to do with the purpose of national uniformity. Each of the above the line and below the line voting options is a way of casting votes for a number of candidates named on the ballot paper. A formal vote can be cast above the line by marking a square against the name of just one political party whose candidates appear below the line. Such a vote adopts as the elector's order of preference the order in which candidates appear below the line. In the case of a party with only two candidates, an example offered by the plaintiffs, an elector who numbers only that party's square above the line votes for its two candidates in the order in which they appear below the line. An elector casting a vote below the line may number as few as six named candidates and still cast a formal vote. The common effect of the different ways of completing a formal Senate ballot paper is to require the elector to choose between named candidates, but to leave the number of candidates chosen to the discretion of the elector, within the limits described. The availability of that Bell Nettle Gordon discretion does not involve the creation of more than one method of choosing Senators. The plaintiffs' submissions should be rejected. Argument B: Senators "directly chosen" The plaintiffs submitted that the requirement in s 7 of the Constitution that the Senators for each State be "directly chosen by the people of the State" refers to candidates elected without the intervention of any intermediary or third party. Above the line voting by marking squares designated by reference to political parties was said to offend against that requirement. The plaintiffs submitted that above the line voting was not a vote for an individual "except derivatively through the operation of the Act". The vote cast was for an intermediary, being the named political party. That characterisation was said to be made clear because it was not possible to preference individual candidates in above the line voting but only parties or groups registered for that purpose. The plaintiffs' characterisation should not be accepted. A vote marked above the line is as much a direct vote for individual candidates as a vote below the line. To number a square above the line identifies the candidates appearing beneath that square below the line. That much was made plain by the plaintiffs' own examples of ballot papers completed above the line. An elector is provided with a direct choice. An elector who does not wish to use the above the line facility is able to vote by allocating preferences below the line. The term "directly chosen by the people" appearing in s 7 also appears in s 24 of the Constitution, which requires that the House of Representatives "shall be composed of members directly chosen by the people". The requirement of direct choice excludes indirect choice by an electoral college or some other intermediary67. That is not the case here. The argument that above the line voting amounts to something other than a direct choice of individuals is untenable. The plaintiffs' submission must be rejected. 67 Attorney-General (Cth); Ex rel McKinlay v The Commonwealth (1975) 135 CLR 1 at 21 per Barwick CJ, 44 per Gibbs J, 56 per Stephen J, 61 per Mason J. Bell Nettle Gordon Argument C: disenfranchisement "Directly proportional representation" and effective The plaintiffs in their written submissions argued that the new form of Senate ballot paper compromised what they called the principle of "directly proportional representation" in the Senate or the "direct proportionality principle". The principle was said to be derived from s 7 of the Constitution, read with ss 24 and 128. Section 24 provides for the constitution of the House of Representatives by "members directly chosen by the Commonwealth" and requires that "the number of such members shall be, as nearly as practicable, twice the number of the senators." It also requires that the number of Members of the House chosen in the several States shall be in proportion to the respective numbers of their people. The principle of proportional representation by reference to population is plainly not applicable to the Senate, where, by virtue of s 7, each State has equal representation, regardless of population. the people of The asserted "direct proportionality principle" was said to be infringed by the Act in two respects: The means of calculating a quota and directing preferences under s 273 was said to result, in an ordinary half-Senate election, in one-seventh of the relevant State electorate being excluded from the count. The vice attributed by the plaintiffs to s 273 was said to be compounded the by what post/preferential party list method of voting above the line". the plaintiffs described as "the optional first past The argument was elusive. In a written outline of their oral submissions the plaintiffs summarised their propositions by saying that the operation and effect of the changes meant that those who voted for candidates of minor parties would "lose the benefit of their vote flowing down the preference chain." The plaintiffs' submissions did not identify any relevant constraint on electors in the means available to them for completing a formal Senate ballot paper. The complaint seemed to be that a large proportion of electors, faced with the "eye-catching appeal [of] a party vote", would simply follow the instructions on the ballot paper for voting above the line and would therefore lose the opportunity to cast "a full and effective vote". Bell Nettle Gordon For reasons already explained, the marking of squares above the line is a vote for candidates whose names appear below the line. Electors may choose to complete all squares below the line, or at least 12 of them, and can cast a formal vote even if they complete only six. They can complete all squares above the line, or at least six of them, and can cast a formal vote by marking only one. There is no principle of "direct proportionality" to be infringed. There is no disenfranchisement in the legal effect of the voting process. The plaintiffs' argument, based upon effects adverse to the interests of so called "minor parties", was in truth an argument about the consequences of elector choices between above the line and below the line voting and in the number of squares to be marked. It should be rejected. Argument D: A free and informed vote The fourth argument advanced by the plaintiffs was that the new form of the Senate ballot paper is misleading in that it "fails to inform the voter that an effective preferential vote requires voting for all candidates and to only preference six risks vote exhaustion and does not set out the full range of voting options". One of the options said not to be mentioned is that the elector need only complete one square above the line. The allegedly misleading character of the ballot paper is said to constitute a burden on the implied freedom of political communication. The argument fails at its threshold. The ballot paper does not mislead. It correctly states the statutory requirements that at least six squares be marked for above the line voting (unless there are fewer than six squares in total) and at least 12 squares be marked below the line (unless there are fewer than 12 squares in total). The fact that it does not refer to provisions of the Act which count the completion of one square above the line as formal and six squares below the line as formal is hardly surprising. They are vote saving provisions. The premise of this argument is not made out. Argument E: Representative government The last argument advanced by the plaintiffs was a kind of "catch all" proposition repeating the complaint in the previous argument and the complaint of effective disenfranchisement. These complaints were gathered into a proposition that a constitutional principle of representative government, and with it the freedom of political communication, are both impaired by the Act as Bell Nettle Gordon amended. No point was made under this heading that has not already been rejected in relation to the plaintiffs' other arguments. Conclusion The following orders should be made. In application S77 of 2016: The application is dismissed. The plaintiff is to pay the second defendant's costs of the application. In application S109 of 2016: The application is dismissed. The plaintiffs are to pay the eighth defendant's costs of the application Annexure 1 Annexure 2

HIGH COURT OF AUSTRALIA APPELLANT AND THE QUEEN RESPONDENT Braysich v The Queen [2011] HCA 14 11 May 2011 ORDER Appeal allowed. Set aside the order of the Court of Appeal of the Supreme Court of Western Australia made on 16 October 2009 dismissing the appeal against conviction and, in its place, order that: the appeal to that Court be allowed; the appellant's convictions be quashed; and the matter be remitted to the District Court of Western Australia for a new trial. On appeal from the Supreme Court of Western Australia Representation M J McCusker QC with S J Lemonis for the appellant (instructed by Ainslie W B Zichy-Woinarski QC with W F Gillan for the respondent (instructed by Commonwealth Director of Public Prosecutions) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Braysich v The Queen Criminal law – Evidence – Burden of proof – Defences – Directions to jury – Appellant charged with creating a false or misleading appearance of active trading in securities – Appellant deemed to have created false or misleading appearance of active trading if proved to have caused a sale of securities where, to his knowledge, there was no change in beneficial ownership of securities – Section creating offence included a defence to prove that the purpose or purposes of the trades was not or did not include purpose of creating a false or misleading appearance of active trading ("proscribed purpose") – Where appellant did not give direct evidence of whether subjective purpose or purposes included proscribed purpose – Trial judge ruled defence not raised and withheld defence from jury – Whether character evidence as to honesty and other evidence in defence case sufficient to require defence to be left to jury – Whether, taking evidence at its highest, jury could conclude on balance of probabilities that appellant lacked proscribed purpose. Corporations – Financial services and markets – Market misconduct and other prohibited conduct – False trading and market rigging. Words and phrases – "balance of probabilities", "evidential burden", "false or misleading appearance of active trading", "legal burden". Corporations Act 2001 (Cth), s 1401. Corporations Law, ss 998, 1311(1). FRENCH CJ, CRENNAN AND KIEFEL JJ. Introduction Following a trial before a judge and a jury in the District Court of Western Australia, the appellant, a stockbroker, was convicted on 10 November 2007 of 25 counts of creating a false or misleading appearance of active trading in securities on the stock market. The offence was created by s 998(1), read with s 1311(1), of the Corporations Law of Western Australia, as incorporated into the Corporations Act 2001 (Cth) ("the Corporations Act") by operation of s 1401 of that Act1. The convictions should be quashed. The trial miscarried. The Crown case on each of the counts was that the appellant had caused a sale of listed shares to be made in circumstances in which, to the appellant's knowledge, there was no change in their beneficial ownership. If that fact were established he was, by force of s 998(5) of the Corporations Law, deemed to have created a false or misleading appearance of active trading in the shares. The finding of fact and the application of the deeming provision were therefore sufficient for conviction. The appellant, however, wished to rely at trial upon a statutory defence, under s 998(6) of the Corporations Law, that the purpose or purposes for which he caused the sales to take place did not include the purpose of creating a false or misleading appearance of active trading. It is common ground that he would have had the burden of establishing that defence on the balance of probabilities. The trial judge ruled at the close of the appellant's testimony that he had not raised the statutory defence. On the basis of that ruling his Honour refused to allow the appellant to call expert evidence to rebut an expert witness called by the Crown in anticipation of the appellant's reliance upon the defence. Counsel was not permitted to address the jury on the defence and the jury were told that it had no application to the appellant. The defence was able to be availed of by his co-accused, who had been his client and one of the principals in the impugned transactions. The trial judge directed the jury accordingly. The Court of Appeal of the Supreme Court of Western Australia (Pullin, Buss and Miller JJA) dismissed an appeal against conviction2. It held that the statutory defence was properly withheld from the jury and the objection to the appellant's expert evidence properly allowed. The Court of Appeal also held 1 See further at [5]-[8]. 2 Braysich v The Queen (2009) 260 ALR 719. Crennan that, in any event, there had been no substantial miscarriage of justice and that, had it come to a different view of the trial judge's rulings, it would have dismissed the appeal3. In this Court, the Crown expressly disclaimed reliance upon and support for that aspect of the Court of Appeal's decision. The appeal to this Court is brought by special leave granted on 30 July 2010 by Hayne and Bell JJ. Its outcome turns upon whether the trial judge erred in withdrawing the statutory defence from the jury and in not permitting the appellant to call expert evidence said to be relevant to that defence. In our opinion his Honour did so err. The statutory framework The indictment, dated 9 August 2007, alleged contraventions by the appellant of ss 998(1) and 1311(1) of the Corporations Act. The reference to those provisions was incomplete. The conduct said to constitute the offences occurred in 1998. The relevant offence creating provisions at that time were ss 998 and 1311 of the Corporations Law, given statutory force in Western Australia by the Corporations (Western Australia) Act 1990 (WA). Section 1401 of the Corporations Act relevantly incorporates into that Act provisions of the Corporations Law of the various States and Territories which had given rise to criminal liabilities in existence immediately before the commencement of the Act on 15 July 20014. That section creates new and substituted liabilities under the incorporated provisions which are equivalent to the old liabilities. It follows that the matter founding the jurisdiction of the District Court of Western Australia was the justiciable controversy arising from contested allegations of contraventions by the appellant of the "substituted, carbon-copy" of ss 998 and 1311 of the Corporations Law5. The relevant parts of s 998 as it stood at the time of the alleged offences were: 3 Applying the proviso in s 30(4) of the Criminal Appeals Act 2004 (WA), discussed in Mahmood v The State of Western Australia [No 2] [2008] WASCA 259. 4 Corporations Act, s 1401(2). 5 Applying the explanation of the operation of s 1401 in Forge v Australian Securities and Investments Commission (2006) 228 CLR 45 at 92 [115] per Gummow, Hayne and Crennan JJ; [2006] HCA 44. Crennan "(1) A person shall not create, or do anything that is intended or likely to create, a false or misleading appearance of active trading in any securities on a stock market or a false or misleading appearance with respect to the market for, or the price of, any securities. (5) Without limiting the generality of subsection (1), a person who: enters into, or carries out, either directly or indirectly, any transaction of sale or purchase of any securities, being a transaction that does not involve any change in the beneficial ownership of the securities; shall be deemed to have created a false or misleading appearance of active trading in those securities on a stock market. In a prosecution of a person for a contravention of subsection (1) constituted by an act referred to in subsection (5), it is a defence if it is proved that the purpose or purposes for which the person did the act was not, or did not include, the purpose of creating a false or misleading appearance of active trading in securities on a stock market. The reference in paragraph (5)(a) to a transaction of sale or purchase of securities includes: a reference to the making of an offer to sell or buy securities; and a reference to the making of an invitation, however expressed, that expressly or impliedly invites a person to offer to sell or buy securities." Section 1311, a general offence provision, provided that a person doing an act that the person was forbidden to do by or under a provision of the Corporations Law was guilty of an offence unless that or another provision of the Law provided that the person was guilty, or not guilty, of an offence. Crennan Section 998 of the Corporations Act, now repealed, differed slightly in its language from s 998 of the Corporations Law6. The operation of s 1401 of the Corporations Act is such that the text of s 998 of the Corporations Law is the applicable text for the purposes of this appeal. The charges against the appellant The indictment contained 26 counts against the appellant7, which took the following three forms: That the appellant created a false or misleading appearance of active trading in the ordinary fully paid shares of Intrepid Mining Corporation NL ("Intrepid") on the Australian Stock Exchange ("the ASX"), in that he caused to be made an offer to buy [a number of] ordinary fully paid shares in Intrepid and thereby caused to be carried out a transaction that did not involve any change in the beneficial ownership of [an equal or lesser number of] the shares, contrary to ss 998(1) and 1311(1) of the Corporations Act8. As above, save that the charge was that the appellant caused to be made an offer to sell9. As in 1 above, save that the allegation was that he "caused to be carried out a transaction that did not involve any change in the beneficial ownership in respect of [a number of] ordinary fully paid shares in Intrepid". The charge did not indicate whether the transaction involved an offer to sell or to buy the shares10. The appellant was convicted on all but one of the counts11. 6 The Financial Services Reform Act 2001 (Cth), s 3 and Sched 1(1) repealed s 998 of the Corporations Act and replaced it with s 1041B of the Corporations Act on 11 March 2002. 7 The indictment was a joint indictment against the appellant and his co-accused, who was charged with 259 counts. 8 Counts numbered 260-262, 264, 265, 267, 269, 270, 272 and 276-278. 9 Counts 263, 268 and 271. 10 Counts 266, 273-275 and 279-285. 11 Count 283. Crennan An account of the evidence at trial and the conduct of the trial is set out in the reasons for judgment of Bell J12. It is sufficient for the purposes of these reasons to refer to salient features of the prosecution and defence cases and the contested rulings of the trial judge. The prosecution case The prosecution case against the appellant involved the following contentions: The appellant was a broker with Paul Morgan Securities Pty Limited The appellant's co-accused, Dean Scook, was, at the time of the transactions giving rise to the charges, a client of Paul Morgan. Two other men (Lance and Steven Masel) and companies controlled by them were also involved in the transactions13. A finance company called Walthamstow Pty Ltd ("Walthamstow"), controlled by the Masels14, advanced money to Scook and Challiston Pty ("Challiston"), a company controlled by Scook, between Ltd November 1997 and April 1998 under loan facility letters and bridging loans to enable Challiston to buy shares in Intrepid on the market or by placement15. Under the finance arrangements, Walthamstow would pay the purchase price of the Intrepid shares acquired by Challiston at settlement16. As security for its advances, Walthamstow held, in its own name, the Intrepid shares acquired by Challiston17. 12 Reasons for judgment of Bell J at [68]-[78]. 13 Lance Masel had died by the time of the trial. 14 (2009) 260 ALR 719 at 724 [12](a). 15 (2009) 260 ALR 719 at 724 [17](c). 16 (2009) 260 ALR 719 at 724 [17](a), (b) and (d). 17 (2009) 260 ALR 719 at 724 [17](b) and (c). Crennan Challiston retained a beneficial interest in the Intrepid shares which it had purchased with Walthamstow's advances18. The appellant had opened a trading account at Paul Morgan in the name of Challiston and commenced taking instructions to trade on the Challiston account on market on 20 January 1998. The appellant, between 2 February 1998 and 27 February 1998, on 26 occasions, caused the sale of Intrepid shares on account of Walthamstow (as vendor) to Challiston (as purchaser). The appellant rebooked each of the shares to Walthamstow on or before the settlement date under a rebooking procedure19. Even though the shares were rebooked to Walthamstow after their purported sales to Challiston, Challiston remained at all times their The appellant was generally aware of the financial arrangements between Walthamstow and Challiston. The Crown relied upon the rebooking procedures, inter alia, to support the inference that the appellant knew that the shares were to be held by Walthamstow as security for its advances to Challiston. The prosecution did not allege that the appellant and Scook were involved in a joint criminal enterprise. There was no allegation of joint or common purpose or of accessorial complicity on the part of the appellant. Admissions made by the appellant at trial included: that Challiston was the buyer and Walthamstow the seller of the relevant shares; that Scook gave instructions for the buy order; 18 (2009) 260 ALR 719 at 725 [18]. 19 (2009) 260 ALR 719 at 723-725 [10]-[19]. 20 (2009) 260 ALR 719 at 724-725 [17]-[18]. Crennan that Paul Morgan was the broker for both buyer and seller; and the time and place of each of the buy orders, sell orders and trades21. The appellant did not admit that he effected all of the relevant transactions. He denied that they did not involve any change in beneficial ownership and denied that he knew that Challiston was the beneficial owner of the shares held in Walthamstow's name22. The defence case The appellant's evidence-in-chief included the following elements: nothing was ever said to him by the Masels to the effect that any shares sold on Walthamstow's account were not beneficially owned by it; he was told by Scook that he wanted his purchases of Intrepid shares rebooked to Walthamstow and sales to come from Walthamstow; he was asked by Paul Morgan's compliance manager, Carol Simpson, to ensure that there would be a change in beneficial ownership in any sale from Walthamstow to Challiston; in February 1998 he effected buy orders and sell orders in relation to the Challiston and Walthamstow accounts. Buy orders were on the Challiston account and there were sell orders to the market on the Walthamstow account; he would always rebook the shares sold to Challiston to the account of Walthamstow on the fifth working day after receiving and effecting the instruction; he tried to ensure that he wrote separate orders so that shares held by Walthamstow for Challiston were sold to the market and not issued to Challiston; 21 (2009) 260 ALR 719 at 726 [20]. 22 (2009) 260 ALR 719 at 726 [23]. Crennan he did not ever knowingly execute a sell order with respect to Intrepid shares from Walthamstow to Challiston which did not involve a change of beneficial ownership; and he did not make any trade between the two companies where he knew that there was no change in beneficial ownership and went "to quite a lot of trouble to not do that." In cross-examination the appellant said that he understood the purpose of the rebooking was "[f]or us to get paid." He thought it was part of a finance arrangement between Messrs Masel and Scook. He accepted that he had never before come across an arrangement which required rebooking of the type in question. It was completely new to him in his many years of experience as a broker. At one point in his cross-examination, the following exchange took place: Did it cross your mind that Mr Scook – and I am here harking back of course to the business rules – was a person that you must have understood would have an interest in creating a false appearance of active trading? It didn't occur to you? No, it wouldn't have occurred to me there that he was a person who wanted to create false active trading. We are talking about 29 or 30 January. Did you not know that he was a person who was taking a very active interest in trading in IRO? No, sir. Did you ever come to that realisation? In what period please, sir? At any time did it occur to you that Mr Scook was a person who was doing a lot of trading in Intrepid shares? In 2003 when I got the brief? It never occurred to you even at the end, towards 27 February, that Mr Scook was doing a lot of trading in these shares? You went and spoke to Mr Scook and what did you ask him? I asked him why we were rebooking the stock and he said, 'It's the way I'd like to do it.' He said that he can go speak to the Masels and ask them to pay for the shares on T plus five and that they would then sell the shares and I'd been asked by Carol to get a copy of any agreement if there was one and he said to me the agreements were varied and that therefore it would be of no benefit. Crennan Did you convey this then back to Ms Simpson? Yes. Six character witnesses were called on behalf of the appellant. They all deposed to his honesty. The Crown case against the appellant appears to have been a strong one. However, as explained below, in determining whether the statutory defence should be left to the jury, it was necessary for the trial judge to take the evidence at its most favourable to the appellant and to consider whether it would be open to the jury, in respect of each of the charges, to be satisfied on the balance of probabilities that the appellant did not have the purpose of creating a false or misleading appearance of active trading in the securities. Questions of the weight to be accorded to the evidence and the credibility of the appellant were matters for the jury. The expert evidence The expert witness called by the prosecution, Professor Raymond da Silva Rosa, gave oral evidence about answers he had provided, in two written reports, to questions posed to him by the Australian Securities and Investments Commission in relation to the trades effected by both the appellant and his co- accused. In brief his answers were: the Intrepid shares traded by the appellant for each day covered by the 26 counts against the appellant ranged from 1.58 per cent to 58.14 per cent of the total volume of Intrepid shares traded on each of those days; the most likely effect of the transactions would have been to increase the price of Intrepid shares; Intrepid's adjusted share price increased over the period of the trades from $1.22 to a maximum of $1.42 before closing at $1.30 on the last day of the period; the transactions would have created, or contributed to, the appearance of an informed investor taking a position in Intrepid; the transactions would have contributed to an appearance of active trading in Intrepid shares; and it was likely that had the transactions not occurred, investors would have had less confidence that there was a liquid market in Intrepid shares. Crennan The appellant was subject to substantial cross-examination on issues about which Professor da Silva Rosa had given evidence. Those issues concerned the volume of transactions in Intrepid shares, the significance of that volume for the appearance of the liquidity of the stock and the effect, on the perceived volume of sales and the price of the stock, of the execution of the transactions late on a trading day. The ruling on the appellant's expert evidence After the Crown the appellant had given evidence, counsel for foreshadowed an objection to the two expert witnesses which the defence had indicated it wished to call. Reports prepared by the appellant's experts had been provided to the prosecution prior to commencement of the trial23. No proofs of evidence or reports were put before the trial judge. All that the judge had before him was the oral description, proffered by Crown counsel, who described the proposed testimony as: a critique by Dr Michael Aitken of Professor da Silva Rosa's reports in relation to the transactions in which the appellant was involved and of Professor da Silva Rosa's conclusion that changes in the prices and volumes of Intrepid shares could have no reasonable explanation other than an attempt to manipulate the share trading. Dr Aitken was formerly a professor at the University of Sydney and was an expert in stock exchange surveillance systems and trading24; and consideration by Mr Guy Le Page, a geologist and investment analyst, of factors affecting the value of shares, the state of the nickel market in 1997 and 1998 and whether there could have been factors affecting the price of Intrepid shares other than an attempt to manipulate the market. The trial judge said, in his ruling on the objection, that "the proposed evidence, does not have probative consequence in the issue to be determined by the jury." His Honour's reasons for reaching that conclusion did not elucidate its basis beyond his evident acceptance of the submission made by counsel for the Crown that "the evidence cannot properly be [led] because it does not go to any issues between the [C]rown and Braysich particularly having regard to the nature of the evidence given by Braysich." That evidence, as described by the trial judge, was that the appellant at no stage knew or believed that the shares in the 23 (2009) 260 ALR 719 at 754 [142]. 24 (2009) 260 ALR 719 at 754 [142]. Crennan Walthamstow account were held by that company other than as their beneficial owner. His Honour also referred to the appellant's evidence that "he took positive steps because of some concerns to ensure that the position was that these transactions involved a change in beneficial ownership." The logic of the ruling seems to have been that the appellant's case that he did not know or believe that there was no change in beneficial ownership involved an implied disclaimer of the statutory defence. The logic was erroneous. The implication could not follow from the appellant's case. It would have been open to the appellant to say that he believed there was a change in beneficial ownership and to contend, by reference to his own direct evidence or otherwise, that he did not have any purpose of creating a false or misleading appearance of active trading. It would have been open to him to maintain the latter contention, even if the first were rejected. It was not to the point that he did not expressly state that he had no such subjective purpose. In principle he could point to any evidence, his own and/or that of other witnesses, which, as a matter of logic or human experience, was inconsistent with the existence of the proscribed purpose and therefore tending against the probability that he had that purpose. He could invite the jury, on the basis of such evidence, to conclude that it was not likely, on the balance of probabilities, that he had the proscribed purpose. The judge's ruling was framed on a basis which prematurely foreclosed those possibilities and thus the question whether, at the close of the appellant's case and that of his co-accused, there was evidence upon which the jury properly instructed could reasonably find the statutory defence made out. The trial judge's ruling on closing addresses Before addressing the jury in closing, counsel for the appellant said to the trial judge: "My understanding from your Honour's ruling yesterday is that I am not permitted to address the jury on the question of the statutory defence of 'no purpose.' It was on that basis that the two witnesses were excluded so I wouldn't want to trespass on your Honour's direction." The trial judge said: "They were excluded on the basis there's no evidence of other purpose." Counsel responded: "I understood it was your Honour's ruling, I just wanted to make sure that that means I can't address on it." Crennan The prosecutor added that there was no point addressing on the question since there was no evidence of it. The trial judge said: "Anyway, consistent with the view I have taken, I will be telling the jury that that isn't an issue. So under those circumstances, it would seem that it ought to be left alone." Counsel for the defence said: "I understand that, your Honour, I with respect disagree." In the circumstances his Honour's remarks amounted to a ruling, although it might have been expressed more definitively, that there was no evidence upon which the statutory defence could be left to the jury. Given that his Honour justified the ruling by reference to his decision on the admissibility of the appellant's expert evidence it was underpinned by a logic dependent upon the evidence given by the appellant and upon the absence of any statement by him about his purpose. The ruling was not based upon a consideration of the whole of the evidence. Moreover, the observation by his Honour that "there's no evidence of other purpose" appears to have involved a misconstruction of the statutory defence. It implied a requirement that the appellant establish positively that he had some purpose other than the proscribed purpose in order to make out the defence. Section 998(6) only required him to negative the proscribed purpose. The trial judge's direction to the jury The trial judge directed the jury that all counts against the appellant alleged that he created a false or misleading appearance of active trading. His Honour gave some general directions about the law: "Where a count alleges that the accused person created a false or misleading appearance the [C]rown is relying upon what is called a deeming provision and it is important that you understand this." He outlined the operation of s 998(5), and said: "so a person who carries out a transaction that doesn't involve any change in the beneficial ownership of the securities – is at law deemed to have created a false or misleading appearance of active trading – unless he establishes a defence about which I will speak shortly." Crennan Directing the jury specifically in relation to the appellant, the trial judge said: "In respect of the counts against Mr Braysich, if you are satisfied that he executed – arranged the transaction deliberately, or facilitated the transaction is probably a better word, deliberately, and that the shares being sold were beneficially owned by Challiston and consequently there was no change in beneficial ownership and he had knowledge that there was no change in beneficial ownership, the proper verdict would be one of guilty. So that is in respect to the Braysich counts. The [C]rown must satisfy you beyond reasonable doubt (1) that he facilitated the transaction, secondly that it was a transaction where there … was no change in beneficial ownership and thirdly and importantly that he had knowledge that there was no change in beneficial ownership." The following day his Honour gave the jury a further direction in relation to the appellant. In the course of that direction he said: "As I said to you yesterday, the defence of other purpose to which I made reference in respect of the created counts alleged against Mr Scook, is not applicable with Mr Braysich, who says that he at all times believed that there was a transfer of beneficial interest in respect to these transactions, so that defence is not a matter that comes up in consideration when looking at the counts against him." This direction, like the response to the appellant's counsel at the close of the evidence, reflected the reasoning that lay behind his Honour's decision that the appellant's expert witnesses could not be called. Counsel for the appellant maintained, before the trial judge, that the statutory defence was open to his client and that the jury ought to have been directed accordingly. The trial judge declined to redirect the jury. The basis upon which his Honour directed the jury that the "no purpose" defence was not available to the appellant was its implied preclusion by the appellant's evidence that he believed that there had been a transfer of the beneficial interest in the shares the subject of the respective transactions. That was an erroneous basis. The different question to which the Court of Appeal directed its attention, was whether there was any evidence sufficient to go to the jury upon which they could conclude on the balance of probabilities that the defence was made out. Crennan The reasoning of the Court of Appeal The principal judgment in the Court of Appeal was delivered by Buss JA, with whom Pullin and Miller JJA agreed. His Honour's reasoning involved the following steps: If the prosecution proves beyond reasonable doubt that the accused knowingly engaged in the activity described in s 998(5)(a) then, subject to s 998(6), the prosecution will have established the offence created by the first limb of s 998(1) read with s 1311(1)25. The accused will have "knowingly engaged" in the activity described in s 998(5)(a) if he or she knew that the transaction of sale or purchase of securities did not involve any change in the beneficial ownership of the securities26. If the prosecution proves beyond reasonable doubt that the accused knowingly engaged in the "relevant activity", the accused will be convicted unless he or she, in reliance on the statutory defence, proves on the balance of probabilities that none of the purposes for which he or she engaged in the relevant activity included the purpose of creating a false or misleading appearance of active trading27. The defence will not be made out if the accused "merely raises a reasonable doubt as to whether he or she had the proscribed purpose, or merely establishes that there is a reasonable and rational inference, available on the evidence, that he or she did not have the proscribed purpose."28 That was a statement about the legal burden resting on an accused who invoked the statutory defence. The trial judge was not bound to leave the statutory defence to the jury "unless there was evidence on the basis of which the jury, acting reasonably and properly directed, could conclude that the defence had been made out." It was "necessary that there be evidence on the basis of which the jury, acting reasonably, could be satisfied, on the balance of 25 (2009) 260 ALR 719 at 733 [54]. 26 (2009) 260 ALR 719 at 733 [54]. 27 (2009) 260 ALR 719 at 743 [94]-[96]. 28 (2009) 260 ALR 719 at 743 [97]. Crennan probabilities, that none of the appellant's purposes for entering into or carrying out any transaction, the subject of a count against him, included the purpose of creating a false or misleading appearance of active trading in Intrepid shares on the ASX."29 It was necessary for the appellant to prove on the balance of probabilities a negative proposition about his subjective state of mind30. The appellant did not give any evidence to the effect that his subjective purposes did not include the proscribed purpose31. Buss JA accepted, correctly, that it "may not be essential, in a particular case, that there be direct evidence as to the accused's subjective purposes, including the absence of the proscribed purpose; that is, it may be possible, in a particular case, for the absence of the proscribed purpose to be inferred from other (objective) evidence."32 Evidence as to the appellant's good character and reputation for honesty did not bear upon his subjective purpose or purposes33. The defence under s 998(6) may be available to an accused who denies knowledge that transactions within s 998(5)(a) involved no change in The fact that the appellant was a stockbroker executing the trades in question in the ordinary course of his business on instructions from his clients and the absence of any evidence that either Mr Scook or Steven Masel ever told him that the purpose of either of them was to create a false or misleading appearance of active trading and his alleged belief that they were reputable people "[did] not address the appellant's subjective purpose or purposes."35 29 (2009) 260 ALR 719 at 748-749 [118]. 30 (2009) 260 ALR 719 at 749 [120]. 31 (2009) 260 ALR 719 at 749 [123]. 32 (2009) 260 ALR 719 at 750 [125](a). 33 (2009) 260 ALR 719 at 751 [125](g). 34 (2009) 260 ALR 719 at 750 [125](a). 35 (2009) 260 ALR 719 at 750 [125](b) and (c). Crennan The evidence relied upon by the appellant36 was, at best, circumstantial evidence from which an inference could be drawn that at all material times he was acting in the ordinary course of his business as a stockbroker in carrying out the relevant transactions37. The absence of any direct evidence as to the appellant's subjective purpose or purposes, including the absence of any direct evidence that he did not enter into or carry out the transactions for the proscribed purpose, was a "critical omission". The circumstantial evidence was not "sufficient" to require the trial judge to leave the statutory defence to the jury38. On the evidence as a whole the jury acting reasonably could not have been satisfied, on the balance of probabilities, that none of the appellant's subjective purposes for entering into or carrying out any transaction the subject of a count against him, included the proscribed purpose39. Professor da Silva Rosa's evidence ceased to be relevant to the appellant because the appellant did not invoke the statutory defence40. Grounds of appeal The grounds of appeal in this Court were: The Court of Appeal erred in law in holding that it is not an error of law for a Trial Judge to direct the jury that a statutory defence open to an accused (the onus of proof of which lies on the accused) is not available to the accused and cannot be considered by the jury because in the opinion of the Trial Judge there is insufficient evidence (albeit some circumstantial evidence) from which the jury could conclude on the balance of probabilities that the defence had been made out. 36 Set out more fully by Buss JA at (2009) 260 ALR 719 at 749-752 [123]-[125]. 37 (2009) 260 ALR 719 at 752 [126]. 38 (2009) 260 ALR 719 at 752 [126]. 39 (2009) 260 ALR 719 at 752 [126]. 40 (2009) 260 ALR 719 at 756 [151]. Crennan The Court of Appeal further erred in law in holding, in effect, that if an accused does not give direct evidence to 'invoke' the statutory defence then it is not an error of law for the Trial Judge to direct defence counsel that it is not open to defence counsel to raise that defence for the consideration of the jury, and then to direct the jury that the defence (although available to a co-accused) is not available to the accused. The Court of Appeal further erred in law in [not] holding that it was an error of law for the Trial Judge before the defence had closed its case to direct that the defence could not call two expert witnesses (whose evidence arguably would have supported the statutory defence) on the ground that the Trial Judge at that stage did not consider the statutory defence was available." The grounds of appeal direct attention to the proper function of the trial judge in a trial by jury and the relationship of that function to the directions that may be given to a jury on whether there is evidence before them upon which a particular defence is open. The evidential burden and the function of the trial judge The indictment, alleging, as it did, offences against a law of the Commonwealth41, attracted the mandate in s 80 of the Constitution that "[t]he trial on indictment of any offence against any law of the Commonwealth shall be by jury". That section constitutes "an adoption of the institution of 'trial by jury' with all that was connoted by that phrase in constitutional law and in the common law of England."42 In a trial by jury the issues of fact are decided by the jury "in the presence and under the superintendence of a judge empowered to instruct them on the law"43. It is an "elementary principle of the criminal law that unless express statutory provision to the contrary be made, the onus lies upon the Crown 41 As noted earlier, s 1401 of the Corporations Act created new and substituted liabilities, under the provisions of the Corporations Law as incorporated into the Corporations Act, equivalent to the pre-existing liabilities for contraventions of the Corporations Law. 42 R v Snow (1915) 20 CLR 315 at 323 per Griffith CJ; [1915] HCA 90. 43 Cesan v The Queen (2008) 236 CLR 358 at 390 [103] per Gummow J; [2008] HCA 52, citing Capital Traction Co v Hof 174 US 1 at 13-14 (1899). Crennan throughout to negative defences sufficiently raised."44 The authority and responsibility of the judge to instruct the jury on questions of law requires the judge "to put to the jury every lawfully available defence open to the accused on the evidence even if the accused's counsel has not put that defence and even if counsel has expressly abandoned it."45 It may also require a direction to the jury that there is no evidence capable of supporting a particular defence to the charge and that they are not to consider that defence in their deliberations46. In such a case the accused is said to have failed to meet the "evidential burden" necessary to raise the defence. Such a direction may be made in respect of a defence which, if open, the prosecution, bearing the "legal burden" of proof, would have to negative beyond reasonable doubt47. It may also be made in respect of a statutory defence, such as that created by s 998(6), which by statute the accused is required to establish48. The standard of proof necessary to discharge the legal burden imposed upon the accused in such a case is proof on the balance of probabilities49. The distinction between the "legal burden" and the "evidential burden" has been explained in this Court as the difference between "the burden … of establishing a case, whether by preponderance of evidence, or beyond a reasonable doubt" and "the burden of proof in the sense of introducing 44 King v The Queen (2003) 215 CLR 150 at 168 [52] per Gummow, Callinan and Heydon JJ; [2003] HCA 42. 45 Fingleton v The Queen (2005) 227 CLR 166 at 198 [83] per McHugh J (footnote omitted); [2005] HCA 34, and see Pemble v The Queen (1971) 124 CLR 107 at 117-118 per Barwick CJ; [1971] HCA 20. 46 Da Costa v The Queen (1968) 118 CLR 186 at 213-215 per Owen J, Kitto, Menzies and Windeyer JJ agreeing; [1968] HCA 51; Lee Chun-Chuen v The Queen [1963] AC 220 at 229-230 per Lord Devlin; Parker v The Queen (1964) 111 CLR 665 at 681-682; [1964] AC 1369 at 1392. 47 As to the defences at common law and created by statute where the accused bears an evidential burden, despite the prosecution's legal burden, see generally Cross on Evidence, 8th Aust ed (2010) at [7050]. 48 Parker v The Queen (1964) 111 CLR 665 at 681-682; [1964] AC 1369 at 1392. 49 See eg Sodeman v The King (1936) 55 CLR 192 at 216 per Dixon J; [1936] HCA 75; Johnson v The Queen (1976) 136 CLR 619 at 644 per Barwick CJ, 653-654 per Gibbs J, 660 per Mason J agreeing; [1976] HCA 44. Crennan evidence"50 (emphasis in original). It has also been explained in the 8th Australian edition of Cross on Evidence by reference to the distinction between the functions of judge and jury51: "The concept of the evidential burden is the product of trial by jury and the possibility of withdrawing an issue from that body. Unlike the concept of the legal burden it is not a logical necessity of litigation about questions of fact: 'If it were to be said of any issue, that it was not covered by an evidential burden, the only effect would be to remove the judge's filtering power in respect of that issue'." What the preceding passage makes clear is that the term "evidential burden" directs attention to the function of the trial judge when instructing the jury about the issues which they are required to determine. The question for the trial judge There are some "defences" in respect of which the accused bears no evidential burden because the negativing of such defences is an integral part of the prosecution's positive case, on which it bears the legal burden. It is not necessary here to discuss which defences fall into that category and which defences give rise to an evidential burden on the accused. Where, as in the present case, a statute creating an offence provides for a defence and imposes the legal burden of establishing that defence on the accused, then the accused also bears the evidential burden. For that evidential burden to be met there must be evidence upon which the trial judge can properly direct the jury that the defence is open as a matter of law. If a trial judge has to consider whether, at the close of the evidence in a criminal trial, a particular defence should be left to the jury, the question which the trial judge will have to ask himself or herself will be: In a case where the legal burden is on the prosecution and the evidential burden on the accused – is there evidence which, taken at its highest in favour of the accused, could lead a reasonable jury, properly instructed, to 50 Purkess v Crittenden (1965) 114 CLR 164 at 167-168 per Barwick CJ, Kitto and Taylor JJ; [1965] HCA 34. 51 Cross on Evidence, 8th Aust ed (2010) at [7200] (footnote omitted). Crennan have a reasonable doubt that each of the elements of the defence had been negatived52? In a case in which both the legal burden and the evidential burden rest upon the accused – is there evidence which, taken at its highest in favour of the accused, could lead a reasonable jury, properly instructed, to conclude on the balance of probabilities that the defence had been established? It is the latter question which should have been asked in this case at trial. It can be reframed by reference to s 998(6) into an inquiry whether there was evidence from which a reasonable jury, properly instructed, could find that it was more likely than not that the appellant lacked the proscribed purpose. Put another way – was there evidence from which the jury could conclude that it was unlikely, in the sense of improbable, that the appellant had the proscribed purpose? The appellant was not required to produce evidence of his subjective purpose or purposes in order to meet the legal burden of establishing the statutory defence. The legal burden on him was to prove on the balance of probabilities that he lacked the proscribed purpose. One way of doing that was to adduce or point to evidence inconsistent with the proposition that he had that purpose. He did not have to point to evidence of his actual purpose in order to invoke the defence. Any evidence that could support an inference that the appellant did not have the proscribed purpose was relevant to the statutory defence. The question whether he had discharged the "evidential burden" was to be answered accordingly. It may be observed that the appellant never had the benefit of a consideration by the trial judge of the whole of the evidence in light of the question which the trial judge was required to ask himself in determining whether the defence should be left to the jury. In fairness to the trial judge, it does not appear that he had the benefit of submissions directing him to that question. That question was only asked and answered adversely to the appellant by the Court of Appeal. An important element of the evidence relevant to the discharge of the evidential burden by the appellant was evidence of his good character. 52 A question on the formulation of which there is "little direct authority" – Cross on Evidence, 8th Aust ed (2010) at [7050]. See Stingel v The Queen (1990) 171 CLR 312; [1990] HCA 61 in relation to the defence of provocation. Crennan The evidence of good character Section 998(6) imposed a legal burden on the appellant to negative, on the balance of probabilities, a dishonest purpose. The appellant called extensive evidence going to his honesty. The question arises – how should such evidence have been used? In this case, the answer is not difficult. In Attwood v The Queen the Court said53: "The expression 'good character' has … a known significance in relation to evidence upon criminal trials; for it denotes a description of evidence in disproof of guilt which an accused person may adduce. He may adduce evidence of the favourable character he bears as a fact or matter making it unlikely that he committed the crime charged." Their Honours quoted with approval the observation of Cockburn CJ in R v Rowton54: "The fact that a man has an unblemished reputation leads to the presumption that he is incapable of committing the crime for which he is being tried." The statement in Attwood and the quotation from the judgment of Cockburn CJ were reiterated in Simic v The Queen55 albeit with the qualification, apparently directed to the statement by Cockburn CJ, that it "did not purport to be a full statement of the law on the subject". The admission and use of evidence of good character has a long history. It dates back, as Gummow J pointed out in Melbourne v The Queen56, to a time before the accused became a competent witness when there was generally no question of a jury using such evidence in an assessment of the accused's testimonial credit. Its history has been characterised by conceptual confusion between reputation and actual disposition. As McHugh J said in Melbourne, character refers to the inherent moral qualities or disposition of a person. It is to be contrasted with reputation, which refers to the public estimation or repute of a 53 (1960) 102 CLR 353 at 359; [1960] HCA 15. 54 (1865) Le & Ca 520 at 530 [169 ER 1497 at 1502]. 55 (1980) 144 CLR 319 at 333; [1980] HCA 25. 56 (1999) 198 CLR 1 at 26 [68]; [1999] HCA 32. Crennan person irrespective of that person's inherent qualities57. The evidence in the present case went to the actual disposition of the appellant. The witnesses called on his behalf testified to their dealings with him, and knowledge of him, as an honest person. In the end, as Gummow J said in Melbourne58: "The issues in the particular case and the nature of the evidence of 'good character' which is proffered will guide the process of reasoning of the tribunal of fact on the path to providing an answer to the ultimate question of whether the accused is guilty beyond reasonable doubt." The same proposition applies to the use of evidence of good character in support of the statutory defence in this case. In discussing what is required of a judge directing a jury where evidence of good character has been called, Hayne J, in Melbourne, referred to the common example of an accused of previous undoubted honesty in money matters being tried for an offence of fraudulently obtaining financial advantage. In such a case, as his Honour observed59: "the judge may think it appropriate to draw the attention of the jury to the fact that prior good character may be thought, by them, to make it less likely that the accused acted with dishonest intent." His Honour added the caveat that on those bare facts there is no requirement that the judge give such a direction. But his observation recognised the potential relevance of evidence of honesty to the likelihood that an accused person has acted dishonestly. The statutory defence in s 998(6) raises an issue of honesty. The purpose of creating a false or misleading appearance of active trading is a dishonest purpose. Evidence of the appellant's honesty was capable of supporting a submission that it was improbable that he acted with that dishonest purpose. The Court of Appeal's dismissal of the evidence of the appellant's good character as evidence which "does not address his subjective purpose or purposes"60 was an 57 (1999) 198 CLR 1 at 15 [33]. 58 (1999) 198 CLR 1 at 28 [72] (footnote omitted). 59 (1999) 198 CLR 1 at 57 [156]. 60 (2009) 260 ALR 719 at 751 [125](g). Crennan error. The Court failed to consider the relevance of the evidence to the question whether the appellant was unlikely to have had the proscribed dishonest purpose. Grounds 1 and 2 – whether the evidential burden was discharged The appellant's submissions pointed to a number of aspects of the evidence at trial, including his own evidence, that were said to be relevant to the presence or absence of the proscribed purpose. As already explained, in assessing that evidence and its relevance, it is necessary to bear in mind that the purpose which he was required to negative on the balance of probabilities was a dishonest purpose. Evidence upon which the appellant relied in contending that he had met the evidential burden included: His evidence given in cross-examination that it did not cross his mind, nor did he understand, that Mr Scook had an interest in creating a false appearance of active trading. His evidence that he acted only upon instructions from people known to him to be reputable business people. His evidence that he was aware that the ASX business rules required him to consider whether the person placing an order with him might have an interest in creating a false appearance of active trading and whether the relevant order appeared to have a legitimate commercial reason. Evidence from six character witnesses as to his honesty. Whatever weight might be attached to these aspects of the evidence in light of the evidence taken as a whole, it cannot be said they were irrelevant to whether the appellant lacked the proscribed dishonest purpose in effecting the transactions the subject of the charges against him. A jury, if they considered such evidence at its most favourable to the appellant, could well ask: is it really likely that an honest man who is acting on instructions from reputable people, who he has no reason to believe have a dishonest purpose, is himself acting with the dishonest purpose of creating a false appearance of active trading in shares – when he was aware of the requirements of the business rules of the ASX and of the law? It may be said that the narrow focus of the question renders it artificial. However, it is framed as it is to illustrate that there was a basis rooted in logic and experience upon which a reasonable jury, considering the evidence identified above, might come to a conclusion in favour of the appellant on the balance of probabilities. The reality of the jury's ultimate decision-making would be more complex because they would have to decide whether to accept all or any of those Crennan favourable elements of the evidence and weigh them up against evidence in the case pointing in another direction. Nevertheless, the question as framed is one which counsel for the defence could fairly have put to the jury and should have been allowed to put to the jury in his closing address. It was evidence which, viewed at its most favourable to the appellant, could have led the jury to be satisfied on the balance of probabilities that he lacked the proscribed purpose under s 998(6). In coming to a contrary conclusion the Court of Appeal erred. It is true that much of the appellant's evidence was directed to his assertion that he did not know of the absence of any change in beneficial ownership of the shares the subject of the impugned transactions. There is a question whether evidence directed to that assertion is to be excluded from consideration in relation to the statutory defence. It may be said that the sequence of decision- making required of the jury by the structure of s 998 would render evidence of the requisite lack of knowledge irrelevant to the absence of the proscribed purpose. The assumed sequence involves the following steps: If the jury were to decide that they were not satisfied beyond reasonable doubt that the appellant knew that there was no change in the beneficial ownership of the shares involved in the transactions, the appellant would be acquitted – cadit quaestio. If the jury were to decide that they were satisfied beyond reasonable doubt that the appellant had the requisite knowledge, then they would necessarily have rejected the evidence that he did not have that knowledge. It is only if the jury were satisfied beyond reasonable doubt that the appellant had the requisite knowledge that they would need to consider the statutory defence (assuming that defence to be open on the evidence). On this basis it might be argued that evidence by the appellant that he lacked the incriminating knowledge should not be taken into account in deciding whether he discharged the evidential burden imposed by the statutory defence. Such logic, while attractive, should not be treated as exhaustive of the reasoning to be applied in determining whether evidence of lack of incriminating knowledge, for the purpose of s 998(5), may be relevant to the statutory defence. The jury may reach a finding adverse to an accused on the question of knowledge by a variety of paths. That finding will involve rejection of the accused's evidence in so far as it bears directly upon his knowledge. Nevertheless, elements of the evidence relating to the circumstances in which an accused person claimed not to have had the relevant knowledge may not have been rejected and may be relevant to the existence of the proscribed purpose. It is not Crennan necessary for the disposition of this appeal to determine whether, and to what extent, such evidence might have remained "in play". A cautious approach to ruling it out is indicated. In the present case, the jury returned verdicts of guilty on the relevant counts, each of which necessarily involved a finding, adverse to the appellant, that he knew that there was no change in the beneficial ownership of the shares in each of the relevant transactions. Those verdicts cannot be relied upon in this appeal. They could only be invoked, as they were by the Court of Appeal, to determine whether, notwithstanding legal error by the trial judge, there had been no substantial miscarriage of justice. That determination by the Court of Appeal was not supported or relied upon by the Crown. The appeal should succeed on grounds 1 and 2, which overlap. The submissions in support of both were ultimately directed to the sufficiency of the evidence at trial to discharge the evidential burden resting on the appellant in respect of the statutory defence under s 998(6). There was evidence upon which that defence should have been left to the jury. Ground 3 – the expert evidence The record concerning the content of the expert evidence which the appellant wished to adduce was sketchy. There were no expert reports or proofs of evidence marked for identification or otherwise before the District Court. Counsel said very little about the content of that evidence at trial. If there is a retrial, no doubt the foundation for the admission of such evidence will be elaborated with some particularity and the trial judge fully apprised of its significance. It is clear enough that the basis upon which the trial judge rejected the evidence at the close of the appellant's testimony was erroneous. However, having regard to the success of the appellant on the first two grounds of appeal, it is unnecessary to deal further with this ground. Conclusion The order of the Court should be: Appeal allowed. Set aside the order of the Court of Appeal of the Supreme Court of Western Australia made on 16 October 2009 dismissing the appeal against conviction and, in its place, order that: the appeal to that Court be allowed; Crennan the appellant's conviction be quashed; and the matter be remitted to the District Court of Western Australia for a new trial. HEYDON J. I agree that the appeal should be dismissed for the reasons given by Bell J, and would add only three things. It was submitted for the appellant that one purpose of his conduct was performing a service for a client in return for a fee and that that was a purpose which was not the purpose of creating a false or misleading appearance of active trading in securities on a stock market. But the purpose of performing a service for a client for a fee is a purpose compatible with the existence of a purpose of creating a false or misleading appearance, unless there is evidence that the first purpose is the sole purpose. The evidence in this case could not establish that the first purpose was the sole purpose. As Bell J points out, a person may act with the purpose of bringing about a result (like creating a false or misleading appearance of active trading) without necessarily having a financial or other interest in that result. And a person may also act with the purpose of bringing about that result even if another purpose was to perform a service for a client in return for a fee. The purpose of performing a service for a fee does not exclude the purpose of creating a false or misleading appearance of active trading. Each item on which the appellant relied in support of his argument that evidence existed to justify his defence under s 998(6) of the Corporations Act 2001 (Cth) was not inconsistent with the defence in the sense that it did not contradict it61. The difficulty is that none of them supported it. Secondly, even if the expert evidence filed by the appellant was capable of constituting evidence of the appellant's purpose, which is a proposition postulating a very indirect and Byzantine form of reasoning, the trial judge's failure to take it into account was not wrong. That is because it was never tendered. No argument was ever put as to why a tender should have succeeded in relation to the s 998(6) defence. Nor was it demonstrated in this Court how the expert evidence supported the s 998(6) defence. Thirdly, s 998(6) is unorthodox. It reverses the burden of proof, and calls for proof of a negative proposition. The appellant's testimony did not contain direct evidence of that negative proposition. What is the evidentiary significance of a person in the position of the appellant failing to give direct testimony? In a civil case, Commercial Union Assurance Co of Australia Ltd v Ferrcom Pty Ltd62, Handley JA extended the principles of Jones v Dunkel63 to a case where a 61 For the legislative background, see n 66 in the reasons for judgment of Bell J. 62 (1991) 22 NSWLR 389 at 418-419. 63 (1959) 101 CLR 298; [1959] HCA 8. party failed to ask a witness questions in chief on a particular topic. He said64: "I do not consider that inferences should be drawn favourable to a party whose counsel refrained from asking any question on [the particular] topic." Could that reasoning be employed in a criminal case like the present65? Could it be employed adversely to the accused? Could it be employed on a submission that there was no evidence to support the s 998(6) defence? These questions were only briefly raised in argument. In view of the existence of other reasons for dismissing the appeal, it is not necessary to examine them. 64 Commercial Union Assurance Co of Australia Ltd v Ferrcom Pty Ltd (1991) 22 NSWLR 389 at 419. 65 Cf Dyers v The Queen (2002) 210 CLR 285 at 291 [6]; [2002] HCA 45. Bell Introduction The appellant was convicted, following a trial before Wisbey DCJ and a jury in the District Court of Western Australia, of 25 counts of false trading on the stock market. Each count charged the appellant with having created a false or misleading appearance of active trading in the ordinary shares of Intrepid Mining Corporation NL ("Intrepid") on the Australian Stock Exchange ("the ASX")66. A person who enters into, or who carries out, the sale or purchase of any securities in circumstances that do not involve any change in the beneficial ownership of the securities is taken to have created a false and misleading appearance of active trading in those securities under a deeming provision67. It is a defence to a prosecution that depends upon the operation of the deeming provision if the accused proves that the purpose or purposes for which he or she engaged in the transaction was not, or did not include, the purpose of creating a false or misleading appearance of active trading in the securities ("the proscribed purpose")68. The procedural history The prosecution depended upon the deeming provision in proof of each of the counts. None of the transactions were said to have involved a change in the beneficial ownership of the shares. At the time of these events the appellant was a director of a stockbroking firm, Paul Morgan Securities Pty Ltd ("Paul Morgan Securities"). One of his clients was Dean Scook, who controlled a company, Challiston Pty Ltd ("Challiston"). Another was Steven Masel. Another was Lance Masel, who with 66 The offences were alleged to have occurred in February 1998. At the time, the offence was created by s 998(1), read with s 1311(1), of the Corporations Law. A the contravention of s 998(1) of commencement of the Corporations Act 2001 (Cth) ("the Corporations Act") is a pre-commencement liability under s 1401(1) of the Corporations Act for which substituted liability equivalent to the pre-commencement liability applies under s 1401(3) of the Act: see Forge v Australian Securities and Investments Commission (2006) 228 CLR 45 at 88-92 [103]-[115] per Gummow, Hayne and Crennan JJ; [2006] HCA 44. the Corporations Law occurring before 67 Corporations Act, s 998(5). 68 Corporations Act, s 998(6). Bell Steven controlled a finance company, Walthamstow Pty Ltd ("Walthamstow"). Challiston and Walthamstow each had accounts with Paul Morgan Securities. In late 1997 and early 1998 Dean Scook entered into a series of share finance facilities with Walthamstow in order to fund the purchase of parcels of shares in Intrepid. One of Walthamstow's requirements under the finance arrangements was that the shares purchased by Dean Scook or Challiston were to be held in Walthamstow's name as security for the loan monies. Shares purchased by Challiston through Paul Morgan Securities as sponsoring broker on CHESS69 were "re-booked" by the appellant on the instructions of Dean Scook or Steven Masel to the Walthamstow account. The offences related to the placement of orders by the appellant effecting the purchase by Challiston of parcels of Intrepid shares that were held on the Walthamstow account as security for the loan advances made by it to Challiston. Beneficial ownership of the shares at all times remained with Challiston. The transactions were carried out between 2 and 27 February 1998. Since the prosecution depended upon proof of acts that engaged the deeming provision it was not necessary to prove that any transaction had created a false or misleading appearance of active trading on the ASX. Nonetheless, expert evidence to prove that the transactions had created that appearance in order to rebut the anticipated statutory defence was led in the prosecution case. The appellant gave evidence that he had not known that there had been no change in the beneficial ownership of the shares. However, he did not state that he had not had the proscribed purpose in carrying out the transactions. He proposed to lead expert evidence to counter that led in the prosecution case. The trial judge found that expert evidence was not relevant to any issue between the parties. His Honour considered that the statutory defence had not been raised in circumstances in which the appellant's case was that he did not know the character of the transactions. The appellant was convicted of 25 of 26 counts charged in the indictment against him70. He was sentenced to 12 months' imprisonment on one count, subject to him being immediately released on entering a bond to be of good behaviour for a period of two years71. He was fined the sum of $1,000 on each of the remaining counts. 69 The Clearing House Electronic Subregister System, operated by the ASX. 70 The appellant was acquitted of count 283. Alibi evidence had been led in relation to this count. 71 Crimes Act 1914 (Cth), s 20(1)(b). Bell It was a joint trial. Dean Scook was charged in the same indictment with 259 counts of false trading in Intrepid shares. One hundred of these counts charged offences in the alternative. In the event, Dean Scook was convicted of 158 offences. Many of the transactions charged against Dean Scook had been carried out by him through other firms of stockbrokers. The prosecution did not contend that the appellant was aware of these other transactions. It did not seek to make a case that Dean Scook and the appellant had been engaged in a joint criminal enterprise. The appellant unsuccessfully appealed against his convictions to the Court of Appeal of the Supreme Court of Western Australia (Pullin, Buss and Miller JJA). He appeals by special leave to this Court on grounds which challenge the rejection of the expert evidence in his case and the refusal to leave the statutory defence for the jury's consideration. For the reasons that follow I would dismiss the appeal. The evidence The central issue in the appeal concerns the sufficiency of the evidence to raise the statutory defence and for this reason it is helpful to refer to the appellant's evidence in somewhat greater detail. What follows is a summary of parts of that evidence. In January 1998 the appellant opened accounts for Challiston and Walthamstow with Paul Morgan Securities. In late January 1998 on Dean Scook's instructions the appellant effected the purchase of a parcel of Intrepid shares for Challiston. Dean Scook asked the appellant to re-book the shares to the Walthamstow account. The appellant did so. In the result the shares purchased by Challiston were held in Walthamstow's name with Paul Morgan Securities as the sponsoring broker. Re-booking was unusual. Ordinarily, it was carried out to correct errors. The officer charged with ensuring compliance with the ASX business rules at Paul Morgan Securities was Carol Simpson. She asked the appellant for further information about the re-booking of the Challiston shares to the Walthamstow account. She told the appellant that she wanted to make sure that there had been a change in the beneficial ownership of the shares. The appellant knew that Walthamstow was acting for Dean Scook or Challiston in connection with the purchase of Intrepid shares but he did not know the details of the finance arrangements. He was aware that under the ASX business rules it was necessary that there be a change in the beneficial ownership of securities that were traded. Steven Masel, on behalf of Walthamstow, advised Paul Morgan Securities that Dean Scook was authorised to sell shares held on its account. Bell Following his discussion with Carol Simpson, the appellant asked Dean Scook about the nature of his finance arrangements with Walthamstow. Dean Scook said that he had a long association with Walthamstow and that there were a variety of finance agreements between them. He did not disclose the details of these arrangements. The appellant told Dean Scook that Carol Simpson was concerned about the re-booking of transactions because of the possibility of trading without a change of beneficial ownership. Dean Scook assured the appellant that this would not occur. He undertook to inform the appellant whether he was selling shares which he owned or shares that Walthamstow owned. The appellant relayed the contents of this discussion to Ms Simpson. He proposed that he would keep a record of sales on the Walthamstow account in which Walthamstow was the owner and those in which Dean Scook was the owner. Ms Simpson agreed to this proposal. Following these discussions, during February 1998 the appellant placed buy and sell orders effecting the purchase by Challiston of Intrepid shares held on the Walthamstow account. Instructions for the buy orders were always given by Dean Scook. The appellant received instructions for the sell orders from Dean Scook or Lance Masel. Settlement was on a "T plus five" basis, meaning within five working days from the date of the transaction. After placing the buy orders the appellant would speak to Steven Masel, or Steven Masel would contact the appellant, and instructions would be received to re-book the shares to the Walthamstow account. The appellant did not put through sell orders on the Walthamstow account without being advised whether the shares belonged to Walthamstow or to Challiston. He kept a record of the advice that he was given concerning the ownership of the shares, designating parcels as "Lance" or "Dean" parcels respectively. In this way the appellant sought to make sure that he did not trade shares belonging to Challiston held on the Walthamstow account to Challiston. He did not knowingly execute any sell orders from Walthamstow to Challiston that did not involve a change in beneficial ownership. On the occasions when Dean Scook told the appellant that the sell order related to shares owned by him, the appellant ensured that the stock was not purchased by Challiston. The appellant did not press Lance Masel or Dean Scook for more information about He regarded himself as providing "an execution service". It was a service that did not include the provision of advice to either client. their dealings. It did not occur to the appellant that Dean Scook had an interest in creating a false appearance of active trading in Intrepid's shares. The appellant had not perceived any irregularity about the conduct of Dean Scook's trading. Dean Scook was a "believer" in Intrepid, whereas the appellant believed that Lance Masel had made a profit and that he was "moving on". Bell The appellant was pleased when the Masels started trading with Paul Morgan Securities since he was keen to see the firm grow. At the time the appellant opened the Walthamstow account, it appeared that Walthamstow was an existing Intrepid shareholder. The Masels were major traders on the ASX and the appellant assumed that their holdings in Intrepid were substantial. The expert evidence Professor Raymond da Silva Rosa, the Director of the Western Australian Centre for Capital Markets Research at the University of Western Australia, gave evidence for the prosecution of the effect of the transactions charged against Dean Scook ("the yellow trades"), the effect of the transactions charged against the appellant ("the green trades") and the combined effect of the yellow and green trades on the appearance of trading on the ASX. His report and a supplementary report, both containing opinions about the effect of the green trades, were in evidence. Parts of the reports dealing with the green trades were projected onto a screen during the course of his oral evidence. Professor da Silva Rosa said that the green trades would have been likely to increase the price of Intrepid shares. He believed that they would have created, or contributed to, the appearance of an informed investor in possession of "positive news" about Intrepid taking a position in the stock. He also believed that the green trades would have contributed towards the appearance of active trading in Intrepid. In the absence of the green trades Professor da Silva Rosa said that it was likely that investors would have had less confidence that there was a liquid market in Intrepid shares. The conduct of the trial – the expert evidence The determinations of the admissibility of the appellant's expert evidence and the availability of the statutory defence were not assisted by the informality with which each was approached by trial counsel. At the end of the appellant's evidence the prosecutor informed the Court that expert reports by Dr Michael Aitken and Mr Guy Le Page had been served on the prosecution before the trial. The prosecutor foreshadowed that he would object to the admission of expert evidence in the appellant's case on the ground of relevance. The appellant's counsel did not tender the reports and seek a ruling on the admissibility of the opinions expressed in them. It does not appear from material in the appeal books that counsel made the submissions that were developed on appeal as to the claimed relevance of opinion evidence to a circumstantial case supporting the statutory defence. There was no evidence before the trial judge or on appeal as to the contents of either report. From the prosecutor's summary of their contents, it appears that each report was directed to establishing that there existed reasonable explanations for the changes in the price of Intrepid shares, and in the volume of Bell trading in Intrepid stock, other than that the market in Intrepid's stock was being manipulated to convey a false or misleading appearance of active trading. The appellant's expert evidence was not formally rejected, neither report having been tendered. The trial judge did indicate his acceptance of the prosecutor's submission. His Honour said the expert evidence did not "have probative consequence in the issue to be determined by the jury." Following this indication the appellant's counsel raised the use that was to be made of Professor da Silva Rosa's reports. The prosecutor responded by expressing his willingness to withdraw "the report". In context, the exchange is to be understood as referring to both of Professor da Silva Rosa's reports. The two reports were withdrawn and thereafter no further reference was made to Professor da Silva Rosa's evidence in the trial. The material parts of the trial judge's remarks made in response to the foreshadowed objection are set out below: "[T]he subsection [s 998(6)] provides that it is … a defence if it is proved that the purpose or purposes for which Braysich did that act was not or did not include the purpose of creating a false or misleading appearance. Mr Braysich gave evidence and enunciated in very clear terms that he at no stage had knowledge or belief that the shares in the Walthamstow account were held by that company other than as the beneficial owner and that he did not engage in any transaction in the knowledge that there was no change in beneficial ownership. In fact his evidence is to the effect that he took positive steps because of some concerns to ensure that the position was that these transactions involved a change in beneficial ownership. It is proposed by Mr Braysich to call at this stage the two experts, the content of whose evidence has been outlined a short time ago. The Crown asserts that the evidence cannot properly be led because it does not go to any issues between the Crown and Braysich particularly having regard to the nature of the evidence given by Braysich. In my view, having regard to the way the case has proceeded, there is no room in the evidence of Braysich or the other material adduced in the Crown case and the case of the accused, Scook, from which the jury would be entitled to infer another purpose. The case against Braysich stands or falls on the deeming provision." The availability of the statutory defence Following the judge's "ruling" on the relevance of the expert evidence, the appellant's counsel raised the question of the statutory defence: Bell "McCusker, Mr: Secondly, while I am on my feet, your Honour, I think I correctly understand your Honour to say that when I address the jury I am not permitted to put to them that purpose is an issue. Wisbey DCJ: We can discuss that later but there is no – the case presented by – the evidence presented by Mr Braysich is otherwise. McCusker, Mr: Perhaps we can have a discussion about that later. Contrary to the tenor of the concluding portion of this exchange, the appellant's counsel appears to have considered that the trial judge had ruled that the statutory defence was not available. After the close of the appellant's case, when the issue properly fell for consideration, the only discussion concerning the defence was: "McCusker, Mr: Your Honour, just before the jury comes in, there is one matter I would like to clarify, I did raise it yesterday. My understanding from your Honour's ruling yesterday is that I am not permitted to address the jury on the question of the statutory defence of 'no purpose'. It was on that basis that the two witnesses were excluded so I wouldn't want to trespass on your Honour's direction. Wisbey DCJ: They were excluded on the basis there's no evidence of other purpose. McCusker, Mr: I understood it was your Honour's ruling, I just wanted to make sure that that means I can't address on it. Wisbey DCJ: Yes. Do you wish to be heard on this, Mr Hall? Hall, Mr: I would have thought from Mr McCusker's point of view there is no point in addressing on it since there is no evidence of it. Wisbey DCJ: Anyway, consistent with the view I have taken, I will be telling the jury that that isn't an issue. So under those circumstances, it would seem that it ought to be left alone. McCusker, Mr: I understand that, your Honour, I with respect disagree." The trial judge directed the jury that the defence under s 998(6) did not apply to the trial of the appellant. At the conclusion of the summing up the appellant's counsel sought to preserve his position. He submitted that: "Just for the record I think your Honour has ruled on both these points but we do maintain that the defence under sections 998(5) [sic, s 998(6)] is available to Mr Braysich." Bell It does not appear from the material in the appeal books that the appellant's counsel at any time explained to the trial judge the basis upon which the statutory defence was said to have been raised. On appeal to this Court, it is said that his Honour, wrongly, concluded that the appellant's failure to give evidence that he did not have the proscribed purpose was determinative against the defence. Particular criticism is directed to the statement that there was no basis upon which the jury might uphold the defence because the case "stands or falls on the deeming provision" given that the defence is confined to a prosecution in which the deeming provision is engaged. The trial judge's ex tempore remarks were made in the context of his consideration of the relevance of expert evidence to the issues in the trial. It is not clear that his Honour, assisted by relevant argument, would have been of the view that absence of the proscribed purpose within the meaning of s 998(6) could only be established by direct evidence. It is not clear that he was doing more than expressing his view about the capacity of the evidence to support the statutory defence in this case. The reasons of the Court of Appeal The central issue in the Court of Appeal was whether the trial judge erred in withholding the statutory defence. The Court of Appeal found that he had not. In the Court of Appeal's view, even if it was an error of law not to leave the defence, it was not an error that had occasioned a substantial miscarriage of justice. In this Court the respondent acknowledged that if the statutory defence should have been left for the jury's consideration, it would not be appropriate to dismiss the appeal upon the basis that no substantial miscarriage of justice had occurred72. The Court of Appeal accepted that direct evidence of an accused person's purpose or purposes, including the absence of the proscribed purpose, is not a condition of raising the statutory defence73. However, it concluded that the evidence was insufficient to raise the defence74. The Court of Appeal grouped the evidence relied upon in support of the appellant's circumstantial case that he did not possess the proscribed purpose into 72 Criminal Appeals Act 2004 (WA), s 14(2). 73 Braysich v The Queen (2009) 260 ALR 719 at 750 [125]. 74 Braysich v The Queen (2009) 260 ALR 719 at 752 [126]. Bell seven categories75. In summary, and preserving the Court of Appeal's lettering, this evidence was: the appellant was a stockbroker and the transactions were carried out in the ordinary course of his business on the instructions of his clients and did not involve the provision of any advice (the "execution service" evidence); (c) Dean Scook and Steven Masel were known to the appellant and believed by him to be reputable. There was no evidence that either had told him that the purpose of either was to create a false or misleading appearance of active trading; the appellant had no motive to create a false or misleading appearance of active trading in Intrepid stock. The only benefit he received from executing the transactions was the receipt of discounted brokerage fees; (e) Mr Scook's evidence was that it was not his purpose to create a false or misleading appearance of active trading in Intrepid; the appellant's purpose in completing two sell order notes had been to distinguish between shares sold on the Walthamstow account that were beneficially owned by it and those shares that were beneficially owned by Challiston; the appellant was of good character and had a reputation for honesty; and the cross-examination of the appellant by the prosecutor on matters relevant to whether the appellant had the purpose of creating a false or misleading appearance of active trading in Intrepid stock included the appellant's knowledge of the ASX business rules and his denials that certain transactions had raised his suspicions. It also included the appellant's belief that there existed legitimate commercial reasons explaining the transactions: that Dean Scook was a "believer" in the stock and that Lance Masel had made a profit and was "moving on". The Court of Appeal said of the evidence summarised in (b), (c), (e), (f), (g) and (h) that in each case it did not address the appellant's subjective purpose 75 Braysich v The Queen (2009) 260 ALR 719 at 750-752 [125]. 76 Braysich v The Queen (2009) 260 ALR 719 at 750-752 [125]. Bell The Court of Appeal was critical of the appellant's submission that the evidence pointed to the absence of any financial motive for engaging in market manipulation. It characterised the evidence summarised at (d) above as misleading if relied upon to prove absence of motive77. The Court of Appeal noted that there was other evidence that was capable of bearing on the appellant's motive78. This evidence included that Paul Morgan Securities had received a fee in the order of $55,000 to $60,000 for underwriting a private placement of Intrepid shares. It also included evidence that Paul Morgan Securities and Saxby Bridge Pty Ltd, a company in which the appellant had a substantial shareholding, had obtained other benefits in connection with that placement. The Court of Appeal said that in the circumstances of this case the absence of direct evidence of the appellant's purpose or purposes in carrying out the transactions was a "critical omission."79 In its view, a jury properly directed as to the law and acting reasonably could not be satisfied on the balance of probabilities that the appellant's purposes did not include the proscribed purpose in carrying out the transactions. It followed that the trial judge had been correct in not leaving the statutory defence for the jury's consideration80. The appellant's submissions The appellant contends that the Court of Appeal erred in much the same way that he submits the trial judge erred. His failure to give evidence, in terms, that he did not have the proscribed purpose is said to have been treated at trial and on appeal as determinative of the capacity of the evidence to raise the defence. A second complaint is that the Court of Appeal examined the evidence in isolation, concluding that individual facts or circumstances did not bear on proof of his purpose, without considering the capacity of the evidence as a whole to support the inference that it was probable that in carrying out the transactions he did not have the proscribed purpose81. The appellant's third complaint is that the evidence raising the defence ought to have included the expert evidence which the trial judge rejected. 77 Braysich v The Queen (2009) 260 ALR 719 at 750 [125]. 78 Braysich v The Queen (2009) 260 ALR 719 at 750-751 [125]. 79 Braysich v The Queen (2009) 260 ALR 719 at 752 [126]. 80 Braysich v The Queen (2009) 260 ALR 719 at 752 [127]. 81 cf R v Hillier (2007) 228 CLR 618 at 638 [48] per Gummow, Hayne and Crennan JJ; [2007] HCA 13. Bell Before addressing these criticisms of the Court's reasoning it is convenient to consider proof of the offence created by s 998(1) of the Corporations Act as the offence stood at the time. The offence of false trading Section 998 relevantly provided: "(1) A person shall not create, or do anything that is intended or likely to create, a false or misleading appearance of active trading in any securities on a stock market or a false or misleading appearance with respect to the market for, or the price of, any securities. (5) Without limiting the generality of subsection (1), a person who: enters into, or carries out, either directly or indirectly, any transaction of sale or purchase of any securities, being a transaction that does not involve any change in the beneficial ownership of the securities; shall be deemed to have created a false or misleading appearance of active trading in those securities on a stock market. In a prosecution of a person for a contravention of subsection (1) constituted by an act referred to in subsection (5), it is a defence if it is proved that the purpose or purposes for which the person did the act was not, or did not include, the purpose of creating a false or misleading appearance of active trading in securities on a stock market." Proof that a transaction created a false or misleading appearance of active trading in securities on the stock market will often be attended by the difficulty of distinguishing between transactions that have that effect because they are designed to have that effect and those that have that effect even though they are carried out for legitimate commercial purposes82. However, certain classes of transaction are well recognised as being carried out for the purpose of market 82 North v Marra Developments Ltd (1981) 148 CLR 42 at 58 per Mason J; [1981] HCA 68; see also Goldwasser, Stock Market Manipulation and Short Selling, (1999) at 62. Bell manipulation. These include "wash sales" and "matched orders"83. "Wash sales" are transactions of sale and purchase in which there is no change in the beneficial ownership of the securities84. "Matched orders" are transactions in which a person making an offer to buy or sell securities knows that an associate has made, or will make, a corresponding offer to sell or buy the same number of securities at the same price. Section 998(1) makes it an offence to create a false or misleading appearance of active trading in securities on a stock market. Section 998(5) deems the conduct of "wash sales" in par (a) and "matched orders" in pars (b) and (c) to have the effect of creating that appearance. The Court of Appeal, correctly, held that the presumption of mens rea is not displaced either expressly or by necessary implication in the offence found in "the first limb" of s 998(1) (creating a false or misleading appearance of active trading on a stock market)85. It said that the requisite blameworthy state of mind for this offence is purpose: the prosecution must prove that it was the accused's purpose to create a false or misleading appearance of active trading in the securities86. In the case of a prosecution invoking the deeming provision, the Court of Appeal said that it was necessary to prove beyond reasonable doubt that the accused knowingly engaged in the activity described in s 998(5)87. The analysis reads the requirement of knowledge into s 998(5). It is, of course, common to read a provision creating a serious criminal offence such as this offence88 as requiring proof of knowledge or some other blameworthy state of mind89. 83 Goldwasser, "The Regulation of Stock Market Manipulation and Short Selling in Australia", in Walker, Fisse and Ramsay (eds), Securities Regulation in Australia and New Zealand, 2nd ed (1998) 515 at 519. 84 Section 998(7) provides that a purchase or sale of securities does not involve a change in the beneficial ownership for the purposes of the section if a person who had an interest in the securities before the purchase or sale, or an associate of the person in relation to those securities, has an interest in the securities after the purchase or sale. 85 Braysich v The Queen (2009) 260 ALR 719 at 741 [86]. 86 Braysich v The Queen (2009) 260 ALR 719 at 742 [89]. 87 Braysich v The Queen (2009) 260 ALR 719 at 743 [94]. 88 The offence is punishable by a maximum sentence of five years' imprisonment and/or a fine of 200 penalty units: s 1311(3) and Sched 3 of the Corporations Act. 89 He Kaw Teh v The Queen (1985) 157 CLR 523; [1985] HCA 43. Bell An alternative interpretation of the provision, taking into account the relationship between sub-ss (1), (5) and (6), is that proof of knowledge is not a requirement of the engagement of sub-s (5). Section 998(5) does not create an offence. It is a provision that facilitates proof of the offence created by s 998(1). It might have been thought that the function of s 998(6) in a prosecution of a s 998(1) offence when "constituted by an act referred to in subsection (5)" (emphasis added) was to transfer the onus of negativing the existence of a blameworthy state of mind to the accused. It is not uncommon in the provision of a statutory offence to transfer the onus with respect to the mental element to the accused, requiring that he or she persuade the jury on the balance of probabilities of the absence of "any criminal intention."90 However, the Court of Appeal's analysis of the operation of s 998 accorded with the way in which the trial was conducted. At trial the prosecution accepted that it was required to prove three elements of the offence: (i) that the appellant entered into or carried out the transaction charged in each count; (ii) that the transaction did not involve a change in the beneficial ownership of the shares; and (iii) that the appellant knew that fact91. Since the analysis, which was favourable to the appellant, was not in issue in this Court it is appropriate, in addressing the grounds of challenge, to assume its correctness92. Proof that an accused had knowledge of the facts and circumstances making his or her act criminal will frequently serve to establish that he or she possessed the purpose, or intention, of producing the result that flowed from the doing of the act. The defence provided by s 998(6) recognises that entering into or carrying out a transaction of sale or purchase that is known not to involve a change in beneficial ownership might be for purposes that do not include the proscribed purpose. The sufficiency of the evidence to raise the statutory defence Section 998(6) is a true defence. The legal burden is placed upon the accused to prove that he or she did not have the proscribed purpose in entering into, or carrying out, the transaction. It requires the accused to prove a negative as to his or her state of mind at the time of the transaction. That burden is 90 Sweet v Parsley [1970] AC 132 at 150 per Lord Reid. 91 Braysich v The Queen (2009) 260 ALR 719 at 724 [14]. 92 Section 998 has been repealed. The offence of false trading and market rigging is now provided in s 1041B of the Corporations Act. This offence applies to all financial products traded on financial markets. The s 1041B offence contains a deeming provision that is broadly similar to that found in s 998(5). The fault element of the offence created by s 1041B is not specified and is accordingly to be ascertained by reference to Ch 2 of the Criminal Code (Cth). Bell discharged by proof on the balance of probabilities93. The accused must first discharge an evidential burden of demonstrating that there is sufficient evidence to warrant the defence being left for the jury's consideration. Proof of a person's state of mind is a fact which like any other may be proved by circumstantial evidence94. Provided that there was evidence upon which the jury acting reasonably could have concluded that the appellant's purposes in carrying out the transaction charged did not include the proscribed purpose, the trial judge was obliged to leave the statutory defence for the jury's consideration. The determination of the sufficiency of the evidence to raise the defence was to be made after the close of the evidence. At that time it was necessary to identify the evidence upon which it would be open to find that the defence was made out. The determination is analogous to the determination of an application that there is "no case to answer". The capacity of evidence to prove a defence (on the balance of probabilities) or the elements of an offence (beyond reasonable doubt) is a question of law95. The determination requires that the evidence is taken at its highest. This recognises that weighing evidence, finding facts and drawing inferences from the facts are matters for the jury to decide. In the case of a defence, the jury may draw any inference fairly open on the evidence favouring its acceptance and reject those parts of the evidence that are against that acceptance. The appellant's evidence at trial was directed to his primary case – that he did not know that there had not been a change in the beneficial ownership of the shares. His omission to state that he did not have the proscribed purpose in carrying out the transactions did not preclude him from reliance on that alternative case in the event that the jury decided the question of knowledge against him. The jury was free to approach its deliberations in whatever way it chose96. However, as earlier noted, the statutory defence could only arise in the event that s 998(5) was engaged. The appellant was entitled to be acquitted in the event that the prosecution failed to prove to the criminal standard that in carrying out the transaction charged he knew there had been no change in the beneficial ownership of the shares. It was necessary for the trial judge to identify evidence 93 Sodeman v The King (1936) 55 CLR 192; [1936] HCA 75. 94 Plomp v The Queen (1963) 110 CLR 234; [1963] HCA 44. 95 Hocking v Bell (1945) 71 CLR 430 at 497 per Dixon J; [1945] HCA 16. See also Glass, "The Insufficiency of Evidence to Raise a Case to Answer", (1981) 55 Australian Law Journal 842. 96 Stanton v The Queen (2003) 77 ALJR 1151; 198 ALR 41; [2003] HCA 29. Bell from which it was open to find that the appellant's purposes in carrying out the transaction knowing that it did not involve a change in beneficial ownership did not include the proscribed purpose. Once the issue of knowledge was determined against the appellant, as it had to be before consideration of the statutory defence arose, some parts of the evidence on which the appellant relied as supporting his circumstantial case, that he did not have the proscribed purpose, ceased to have the capacity to do that work. The point is illustrated by the appellant's reliance on evidence that he had not suspected that Dean Scook wanted to manipulate the market in Intrepid's shares. In the Court of Appeal and in this Court the appellant submitted that it was open to reason from this evidence that it was unlikely that he had a purpose of creating a false or misleading appearance. However, regardless of whether the jury accepted the appellant's evidence on this topic, it was evidence that could not provide a basis for inferring that the appellant did not have the proscribed purpose in carrying out a transaction knowing that it involved no change in beneficial ownership. This explains the Court of Appeal's rejection of the evidence summarised in (c), (e), (f), (g) and (h) as not going to proof of the appellant's purpose. It is convenient to consider the refusal to receive the appellant's expert evidence before addressing the evidence summarised in (b) and The absence of the expert evidence The Court of Appeal said that the trial judge had been right to exclude the appellant's expert evidence. This was a conclusion that flowed from the Court's acceptance that the appellant had not raised the statutory defence. The Court of Appeal said that Professor da Silva Rosa's evidence had ceased to be relevant when the statutory defence was not raised and it followed that no occasion arose to rebut that evidence. It said that the appellant was not entitled, by expert evidence or otherwise, to "go behind" the deeming provision once that provision was engaged97. The appellant complains that the Court of Appeal did not address the nub of his argument, which was that the expert evidence went to proof of his purpose within s 998(6). In his submission, the admission of Professor da Silva Rosa's evidence carried with it implicit recognition that proof that the transactions did, or did not, have the effect of creating a false or misleading appearance of active trading on the ASX was logically relevant to the assessment of whether in carrying out the transactions he had that outcome as one of his purposes. 97 Braysich v The Queen (2009) 260 ALR 719 at 756 [151]. Bell All that is known of the content of the opinion evidence that the appellant wished to lead is that it went to demonstrating that reasonable explanations could be posited for the changes in the price of Intrepid shares and in the volume of trading in Intrepid other than that the market in Intrepid stock was being manipulated. Proof of those explanations was not capable of affecting the likelihood that the appellant did not have the proscribed purpose in carrying out transactions of sale and purchase on the market knowing that they did not involve any change of beneficial ownership. At the end of the appellant's evidence, when the prosecutor raised the question of the relevance of expert evidence to the issues in the trial, it was open to the trial judge to review the basis upon which Professor da Silva Rosa's evidence had been received and to exclude it. The prosecutor's submissions invited such a course. So much was acknowledged by his offer to withdraw Professor da Silva Rosa's reports. It is regrettable that no attention was given to Professor da Silva Rosa's oral evidence. It, too, should have been withdrawn and the jury should have been given a direction to put the whole of his evidence out of consideration when dealing with the appellant's case. However, there is no reason to doubt the Court of Appeal's conclusion that the omission did not occasion a miscarriage of justice. Neither party made any reference to Professor da Silva Rosa's evidence in the course of their closing addresses. Senior counsel for the appellant did not ask the trial judge to give any direction concerning the matter. Conclusion The appellant's circumstantial case that he did not have the proscribed purpose in carrying out the transactions knowing that they did not involve a change in beneficial ownership comes down to the evidence summarised in (b) and (d) above. Together they support his submission that he was doing no more than providing an "execution service": the appellant, a man of good character, carried out the transactions on his clients' instructions in his professional capacity as a stockbroker. From this evidence it is said to have been open to conclude that it was probable that the appellant's only purposes were to perform a service for his clients (the evidence summarised in (b) above) in return for discounted brokerage fees (the evidence summarised in (d) above). In considering the sufficiency of the circumstantial evidence to raise the defence the appellant is right to point to evidence from which it was open to infer that he did not have a financial incentive to engage in manipulation of the market. Whether this was the inference to be drawn from the whole of the evidence was a matter for the jury to determine. In what follows, the assessment of the "execution service" evidence includes taking into account the appellant's lack of financial motive for manipulating the market in Intrepid's shares. Bell Although the Court of Appeal said that the evidence summarised in (b) above did not address the appellant's subjective purpose, it went on to acknowledge that the inference was open that at all material times the appellant was acting in the ordinary course of his business as a stockbroker in carrying out the transactions98. The Court of Appeal is to be understood as having concluded that the "execution service" evidence did not provide a sufficient foundation for leaving the statutory defence for the jury's consideration. An understanding of the reasons for the Court of Appeal's conclusion requires consideration of proof of purpose within s 998(6) and what it means to create a false or misleading appearance of active trading in securities on a stock market. In North v Marra Developments Ltd99 Mason J said of a provision of a New South Wales statute framed in similar terms to s 998(1)100 that: "The section seeks to ensure that the market reflects the forces of genuine supply and demand. By 'genuine supply and demand' I exclude buyers and sellers whose transactions are undertaken for the sole or primary purpose of setting or maintaining the market price." His Honour went on to explain of the transactions under consideration in that case that absent disclosure to the market of their true nature they would appear to be real or genuine, there being no overt sign of market support or manipulation. This gave the transactions the false or misleading appearance101. His Honour's remarks have been frequently cited in cases dealing with similar legislation, including cases dealing with s 998(1)102. The Court of Appeal 98 Braysich v The Queen (2009) 260 ALR 719 at 752 [126]. 99 (1981) 148 CLR 42 at 59. 100 Section 70 of the Securities Industry Act 1970 (NSW) provided that "[a] person shall not create or cause to be created or do anything which is calculated to create, a false or misleading appearance of active trading in any securities on any stock market in the State, or a false or misleading appearance with respect to the market for, or the price of, any securities." 101 North v Marra Developments Ltd (1981) 148 CLR 42 at 59. 102 Fenwick v Jeffries Industries Ltd (1995) 13 ACLC 1334 at 1345-1346; Fame Decorator Agencies Pty Ltd v Jeffries Industries Ltd (1998) 28 ACSR 58 at 62-63 per Gleeson CJ; Australian Securities Commission v Nomura International plc (1998) 89 FCR 301 at 391-392; R v Manasseh (2002) 167 FLR 44 at Bell drew on those remarks in its discussion of the meaning of creating a false or misleading appearance of active trading103. The Court of Appeal said that "active trading" requires something more than ordinary volume or price changes in the securities in question. In this respect it cited with approval104 the following passage from "Regulation of Stock Market Manipulation"105: "The determination whether a particular pattern of new trading has created actual or apparent active trading is a function of the prior state of the market in the security, the number of shares actively traded, and the general level of market activity as well as of the particular trading attributable to the alleged manipulator. Therefore, generalization as to how much trading is active trading is impossible." There was no issue as to the Court of Appeal's analysis in these respects. Transactions of sale and purchase in which there is no change of beneficial ownership do not reflect genuine forces of supply and demand in the market, and for this reason, if the true circumstances are not disclosed, are apt to convey a false or misleading appearance of active trading. Section 998(6) recognises that a person may enter into, or carry out, such a transaction for purposes that do not include the purpose of creating that appearance. "Purpose" in s 998(6) is to be understood as connoting the intention of bringing about the result to which the intent is directed106. Thus, the appellant carrying out transactions of sale and purchase of shares in Intrepid on the ASX knowing that they were transactions in which there was no change of beneficial ownership of the shares might nonetheless demonstrate that his purposes did not include the proscribed purpose. Evidence identifying a commercial or other purpose for a person carrying out a transaction caught by the deeming provision (being a purpose other than the creation of a false or misleading appearance of active trading) may suffice to raise the defence. There was no evidence of that character here. The "execution service" submission tends to overlook the fact that a person may act with the purpose of bringing about a result without necessarily having a financial or other interest in that outcome. The appellant, a stockbroker, was aware that trades not involving a change in beneficial ownership are not to be carried out on the ASX. He carried out such 103 Braysich v The Queen (2009) 260 ALR 719 at 744 [102]. 104 Braysich v The Queen (2009) 260 ALR 719 at 743-744 [100]. 105 "Regulation of Stock Market Manipulation", (1947) 56 Yale Law Journal 509 at 106 He Kaw Teh v The Queen (1985) 157 CLR 523 at 569-570 per Brennan J. Bell transactions. The fact that he did so in return for the payment of fees, on the instructions of valued clients, could not, without more, establish that it was probable that his purposes did not include the outcome that the conduct of transactions on the ASX not involving sales by a genuine seller to a genuine buyer was likely to produce. The Court of Appeal was right to conclude that the evidence was insufficient to warrant leaving the statutory defence for the jury's consideration. I would dismiss the appeal.

HIGH COURT OF AUSTRALIA MINISTER FOR IMMIGRATION AND BORDER PROTECTION APPELLANT AND YOGESH KUMAR & ORS RESPONDENTS Minister for Immigration and Border Protection v Kumar [2017] HCA 11 8 March 2017 ORDER Appeal allowed. Set aside orders 2-4 of the orders of the Federal Court of Australia made on 23 February 2016 and, in their place, order that: order 2 of the orders of the Federal Circuit Court of Australia made on 14 September 2015 be set aside; and the appeal to that Court otherwise be dismissed. The appellant pay the first, second and third respondents' costs of the appeal to this Court. On appeal from the Federal Court of Australia Representation G R Kennett SC with P M Knowles for the appellant (instructed by Australian Government Solicitor) M D Howard SC with D V Blades for the first to third respondents (instructed by Cathal Smith Legal Pty Ltd) Submitting appearance for the fourth respondent Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Minister for Immigration and Border Protection v Kumar Statutes – Interpretation – Acts Interpretation Act 1901 (Cth), s 36(2) – Where first respondent's application for visa received and taken to be made on Monday 13 January – Where first respondent able to meet visa criteria in Migration Regulations 1994 (Cth) if first respondent held valid second visa at time of application – Where first respondent's second visa expired on Sunday 12 January – Whether s 36(2) of Acts Interpretation Act allowed application to be assessed as if it had been made before expiry of first respondent's second visa. Words and phrases – "an Act requires or allows", "last day", "prescribed or allowed by an Act", "state of affairs", "thing to be done", "time of application". Acts Interpretation Act 1901 (Cth), s 36(2). Migration Act 1958 (Cth), ss 31, 45, 46, 47, 65. Migration Regulations 1994 (Cth), Sched 2, cl 572.211. BELL, KEANE AND GORDON JJ. Section 36(2) of the Acts Interpretation Act 1901 (Cth) ("the Interpretation Act") provides that if an Act "requires or allows a thing to be done" and "the last day" for the doing of the thing is a Saturday, a Sunday or a holiday then the thing may be done on the next day that is not a Saturday, a Sunday or a holiday. The issue in the appeal is whether the Migration Act 1958 (Cth) ("the Act") and the Migration Regulations 1994 (Cth) ("the Regulations"), governing the first respondent's application for a specified class of visa, provide a "last day" for the application to be made. The statutory scheme The Act requires a non-citizen who wants a visa to apply for a visa of a particular class1. An application is only valid if it is an application for a visa of a class that is prescribed and conforms to the requirements of the Regulations2. Schedule 1 to the Regulations sets out the requirements for the making of a valid application for a visa. Schedule 2 to the Regulations contains the criteria for the grant of visas of specified classes3. The appellant, the Minister for Immigration and Border Protection ("the Minister"), is required to consider a valid application for a visa4. After considering a valid application, if the Minister is satisfied that any charges payable have been paid, the prescribed criteria for the visa have been satisfied and the grant is not prevented by law, he or she is to grant the visa. If the Minister is not so satisfied, he or she is to refuse to grant the visa5. The Regulations prescribe a class of visa known as a Subclass 572 (Vocational Education and Training Sector) visa ("a 572 visa"). Clause 572.211 of Sched 2 to the Regulations specifies the criteria that must be satisfied at the time of making an application for a 572 visa. In the case of an application that is made in Australia, the applicant may meet the requirements of cl 572.211 if he or she is the holder of a visa of a class or subclass specified in sub-cl (2). The Subclass 485 (Temporary Graduate) visa ("a 485 visa") is a subclass specified for 1 Migration Act 1958 (Cth), s 45. 2 Migration Act 1958 (Cth), s 46(2). 3 Migration Act 1958 (Cth), s 31(3). 4 Migration Act 1958 (Cth), s 47(1). 5 Migration Act 1958 (Cth), s 65(1). Bell the purposes of sub-cl (2)(d)6. An applicant who is in Australia may also meet the requirements of cl 572.211, notwithstanding that he or she does not hold a substantive visa, provided his or her last substantive visa was one of the classes or subclasses specified in sub-cl (3). The first and second respondents' visa application The first and second respondents are married and the third respondent is their son ("the respondents")7. The first respondent applied for a 572 visa as the primary applicant and the second respondent applied for a 572 visa as his dependent spouse. Their application was required to be made to an office of the Department of Immigration and Border Protection ("the Department")8. The application was received at the Department's Perth office on Monday, 13 January 2014. The first respondent's 485 visa expired on Sunday, 12 January 2014. On 16 May 2014, a delegate of the Minister refused to grant the 572 visas to the first and second respondents because at the date the application was made the first respondent did not meet the criteria specified in cl 572.211. On Monday, 13 January 2014, the first respondent was not the holder of a substantive visa within one of the classes or subclasses specified in cl 572.211(2), his 485 visa having expired on Sunday, 12 January 2014, nor was his previous substantive visa of one of the classes or subclasses specified in cl 572.211(3). The first and second respondents applied to the Migration Review Tribunal ("the Tribunal") for a review of the delegate's decision. The Tribunal agreed with the delegate's conclusion that the first respondent did not satisfy the criteria specified in cl 572.211. On 29 January 2015, the Tribunal affirmed the delegate's decision. The Federal Circuit Court The respondents sought judicial review of the Tribunal's determination in the Federal Circuit Court of Australia (Judge Street). The respondents submitted that the Tribunal erred by failing to apply s 36(2) of the Interpretation Act, which provides: 6 Migration Regulations 1994 (Cth), Sched 2, cl 572.211(2)(d)(iia). 7 The fourth respondent is the Administrative Appeals Tribunal, which entered a submitting appearance. 8 Migration Regulations 1994 (Cth), reg 2.10(2A)(b) and reg 1.03 definition of "Immigration". Bell an Act requires or allows a thing to be done; and the last day for doing the thing is a Saturday, a Sunday or a holiday; then the thing may be done on the next day that is not a Saturday, a Sunday or a holiday. Example: If a person has until 31 March to make an application and 31 March is a Saturday, the application may be made on Monday 2 April." It was the respondents' case before the Federal Circuit Court that "the requirements of cl 572.211(2)" were a thing that the Act and the Regulations "allowed" to be done for the purposes of s 36(2)9. The respondents drew an analogy with the statutory example of the operation of s 36(2)10. It is to be observed that unlike the example, the Act and the Regulations impose no time limit on the making of an application for a 572 visa. Nonetheless, the respondents submitted that s 36(2) operated such that the first respondent continued to meet the requirements of cl 572.211(2)(d)(iia) on Monday, 13 January 2014. The argument called in aid Burchett J's dissenting reasons in Zangzinchai v Millanta for the proposition that it is not necessary that an Act or regulations prescribe in terms that something shall be done within a particular period in order to engage s 36(2)11. Judge Street considered that cl 572.211(2) does not prescribe or allow anything to be done, but rather identifies a state of affairs that must exist as a criterion for the making of a valid application12. It followed that s 36(2) of the Interpretation Act had no application, a conclusion which his Honour considered to be in line with the majority's reasons in Zangzinchai13. 9 Kumar v Minister for Immigration [2015] FCCA 2573 at [9]. 10 Kumar v Minister for Immigration [2015] FCCA 2573 at [4]. 11 Kumar v Minister for Immigration [2015] FCCA 2573 at [8] citing Zangzinchai v Millanta (1994) 53 FCR 35 at 42, 48. 12 Kumar v Minister for Immigration [2015] FCCA 2573 at [11]. 13 Kumar v Minister for Immigration [2015] FCCA 2573 at [12] citing Zangzinchai v Millanta (1994) 53 FCR 35 at 38-39 per Neaves and Beazley JJ. Bell The decision of the Full Court of the Federal Court of Australia in Zangzinchai considered the scope of s 36(2) of the Interpretation Act as it stood before amendment in 2011 ("the 2011 amendments")14. At the time, s 36(2) provided: "Where the last day of any period prescribed or allowed by an Act for the doing of anything falls on a Saturday, on a Sunday or on a day which is a public holiday or a bank holiday in the place in which the thing is to be or may be done, the thing may be done on the first day following which is not a Saturday, a Sunday or a public holiday or bank holiday in that place." In Zangzinchai, an unsuccessful applicant for an extended eligibility (economic) entry permit sought a review of the decision before the Immigration Review Tribunal. The Migration (Review) Regulations 1989 (Cth) conditioned eligibility for a review on the lawful presence in Australia of the applicant for review when he or she lodged that application. The applicant had lodged his application on Monday, 2 March 1992. The Immigration Review Tribunal declined to review the decision not to grant the entry permit, holding that the applicant had ceased to be lawfully present in Australia on the expiration of his temporary entry permit on 1 March 1992, a Sunday. Upholding the Immigration Review Tribunal's decision, Neaves and "The regulations did not prescribe or allow a time in which an application for an extended eligibility (economic) entry permit might be made. Rather, different consequences flowed depending upon whether the application was made while the applicant was or was not the holder of a temporary entry permit. If a person made an application after a temporary entry permit had expired, the person had to satisfy different criteria before being eligible for the grant of a further entry permit, than was the case if the person was the holder of an entry permit at the time of application." Burchett J, in dissent, would have allowed the appeal. His Honour favoured imputing to the legislature the intention of giving s 36(2) "the widest 14 Acts Interpretation Amendment Act 2011 (Cth), Sched 1, item 93. 15 Zangzinchai v Millanta (1994) 53 FCR 35 at 39. Bell possible scope"16. His Honour considered that s 36(2) applied "where the effect of an Act is to prescribe or allow 'anything' to be done on a Sunday etc, whether or not that effect arises out of a direct and precise prescription"17. What his Honour did not explain was how s 36(2) operated in the circumstances to deem the applicant in Zangzinchai to be lawfully present in Australia on Monday, 2 March 1992. The respondents' appeal to the Federal Court of Australia The respondents appealed to the Federal Court of Australia (North J)18. His Honour found that the primary judge erred by asking whether s 36(2) of the Interpretation Act applied to the criteria specified in cl 572.211(2) when the thing that the Act "allows" to be done is for a non-citizen to apply for a visa19. His Honour distinguished Zangzinchai on the basis that it was concerned with the earlier form of s 36(2) of the Interpretation Act. North J observed that the earlier form of the provision applied where a period was "prescribed or allowed by an Act", while the current provision applies where an Act "requires or allows" a thing to be done. His Honour considered the latter formulation gives the provision a broader operation20. His Honour held that s 36(2) does not say it operates only as an extension of time; rather, it "allows the thing … to be done … on the later date as if it were being done on the earlier 16 Zangzinchai v Millanta (1994) 53 FCR 35 at 47-48. 17 Zangzinchai v Millanta (1994) 53 FCR 35 at 48 (emphasis in original). 18 Kumar v Minister for Immigration and Border Protection (2016) 243 FCR 146. North J at 147 [4]-[6] noted that there was some confusion as to the parties to the appeal. The first and second respondents applied for 572 visas. It does not appear that an application was made on behalf of their son, the third respondent. The first and second respondents applied for review to the Tribunal. The first to third respondents sought judicial review of the Tribunal's decision in the Federal Circuit Court and on appeal from that Court to the Federal Court. It was accepted by the parties in the Federal Court that the determination of the first respondent's appeal would determine the outcome of the appeals brought by the second and third respondents. 19 Kumar v Minister for Immigration and Border Protection (2016) 243 FCR 146 at 20 Kumar v Minister for Immigration and Border Protection (2016) 243 FCR 146 at Bell date"21. As a matter of fact, his Honour said, the last day for the first respondent to apply for the 572 visa was Sunday, 12 January 201422. It followed that s 36(2) operated to allow the application for the 572 visa to be made on Monday, 13 January 201423. In order for "the thing" to be "done", the circumstances existing on Sunday, 12 January 2014 were, by operation of the sub-section, to be regarded as existing on Monday, 13 January 201424. The respondents' appeal was allowed, the decision of the Tribunal quashed and the matter remitted for determination in accordance with law25. Special leave to appeal was granted by Kiefel and Nettle JJ on 2 September 2016. The Minister appeals to this Court contending that the Federal Court erred in holding that s 36(2) of the Interpretation Act had the effect that the first respondent's application for a 572 visa was to be assessed as if that application had been made before the expiry of his 485 visa. As a condition of the grant of special leave, the Minister agreed to pay the respondents' costs in this Court regardless of the outcome of the appeal and not to disturb the costs order below. For the reasons to be given, the appeal must be allowed. The submissions The Minister's short point is that the Act and the Regulations do not impose a time limit on the making of an application for a 572 visa. Section 36(2) operates to extend time in a case in which the last day for doing a thing that is required or allowed by an Act falls on a Saturday, a Sunday or a holiday. The first respondent's application for a 572 visa, made on 13 January 2014, was not time-barred. It was accepted as a valid application. The first respondent's circumstances on 13 January 2014 were such that he did not satisfy the criterion specified in cl 572.211(2)(d)(iia) or any other of the criteria for the grant of a 572 21 Kumar v Minister for Immigration and Border Protection (2016) 243 FCR 146 at 22 Kumar v Minister for Immigration and Border Protection (2016) 243 FCR 146 at 23 Kumar v Minister for Immigration and Border Protection (2016) 243 FCR 146 at 24 Kumar v Minister for Immigration and Border Protection (2016) 243 FCR 146 at 25 Kumar v Minister for Immigration and Border Protection (2016) 243 FCR 146 at Bell visa. The Minister submits that the vice in North J's analysis is that cl 572.211(2)(d)(iia) is found to be met even though at the time the first respondent made his application he did not hold a 485 visa. The respondents submit that under the Act and the Regulations the first respondent was allowed to apply for a 572 visa as the holder of a 485 visa. The last day on which he could make an application for a 572 visa that was capable of being granted was Sunday, 12 January 2014. As the last day for making that application was a Sunday, the respondents contend that s 36(2) is engaged to allow it to be made on Monday, 13 January 2014. The respondents disavow North J's analysis that s 36(2) operates to allow the thing in question to be effectuated on the later date as if the thing were being done on the earlier date26. And the respondents disavow that s 36(2) operates to alter the criteria in cl 572.211. Nonetheless they contend that "if the application could be made on a Sunday if the Department was open – the Department was not open – it can be made on the Monday, the next working day". They submit that North J was correct to distinguish Zangzinchai on the basis that the current provision has a broader operation than the provision it replaced. In the alternative, they submit that Zangzinchai was wrongly decided. The 2011 amendments Had the object of the 2011 amendments been to substantively alter s 36(2), giving it a broader operation than the operation of its predecessor as explained by the majority in Zangzinchai, it is to be expected that that intention would have been clearly expressed. Contrary to North J's analysis, there is no material difference between the former and the current provisions: nothing turns on the use of the past tense of the verb "prescribe" in the former provision and the use of the present tense of the verb "require" in the current provision. As the Minister submits, the breaking-up of a single sentence into sub-paragraphs in the current provision is in line with modern drafting conventions. Where an Act has expressed a particular idea in a form of words and a later Act appears to express the same idea in a different form of words for the purpose of using a clearer style, the ideas are not to be taken to be different merely on that account27. The Explanatory Memorandum to the Bill for the 2011 amendments supports the conclusion that the amendment of s 36(2) was not intended to substantively alter 26 Kumar v Minister for Immigration and Border Protection (2016) 243 FCR 146 at 27 Acts Interpretation Act 1901 (Cth), s 15AC. Bell the operation of the provision, but rather was to make the provision more "user friendly"28. Memorandum29: the following passage from the Explanatory "Section 36, which deals with how time periods are to be calculated, is being modernised by use of a table to show how different scenarios are to be interpreted in Commonwealth Acts and provides examples for each of the items in the table. It is intended to capture a broader range of situations that are likely to arise from time to time – such as where an Act specifies a period for doing something and the place for doing the thing is closed on the first or last day of doing that thing." The reference to capturing a broader range of situations is to be understood as the introduction of the table in sub-s (1)30 in place of the former 28 Australia, House of Representatives, Acts Interpretation Amendment Bill 2011, Explanatory Memorandum at 35 [225]. 29 Kumar v Minister for Immigration and Border Protection (2016) 243 FCR 146 at 151 [25] citing Australia, House of Representatives, Acts Interpretation Amendment Bill 2011, Explanatory Memorandum at 35 [224]. 30 Section 36(1) provides (examples omitted): A period of time referred to in an Act that is of a kind mentioned in column 1 of an item in the following table is to be calculated according to the rule mentioned in column 2 of that item: Calculating periods of time Column 1 Item If the period of time: is expressed to occur between 2 days is expressed to begin at, on or with a specified day is expressed to continue until a specified day is expressed to end at, on or with a specified day is expressed to begin from a specified day Column 2 then the period of time: includes both days. includes that day. includes that day. includes that day. does not include that day. (Footnote continues on next page) Bell provision, which provided that where any period of time was dated from a day, act or event, the time was to be reckoned exclusive of that day, act or event. It also is to be understood as a reference to the introduction of sub-s (3), which defines "holiday" in relation to the time for doing a thing so as to include both public holidays and, in the case of a thing that is to be done at a particular place or office, a day on which the place or office is closed for the whole day. The Explanatory Memorandum also stated that "[the amendment] does not substantively change the existing policy"31. It is true, as North J observed, that the Explanatory Memorandum does not identify that policy32. Nonetheless, such as it is, the Explanatory Memorandum provides no support for a conclusion that the 2011 amendments broadened the scope of s 36(2). The operation of s 36(2) as it then stood was touched upon in Associated Dominions Assurance Society Pty Ltd v Balmford33. The issue raised by Zangzinchai and by the present appeal was not addressed in Balmford; however, the statements in Balmford are consistent with the majority's analysis in Zangzinchai in reading s 36(2) as an interpretive rule serving to extend time in the stated circumstances and not to otherwise alter or affect rights or obligations under the Act34. Conclusion It is not in question that s 36(2) is not confined to statutory provisions that expressly stipulate a "last day" for a thing to be done. As the Minister submits, the last day for doing something under an Act may be calculated by reference to is expressed to begin after a specified day is expressed to end before a specified day does not include that day. does not include that day. 31 Australia, House of Representatives, Acts Interpretation Amendment Bill 2011, Explanatory Memorandum at 35 [225]. 32 Kumar v Minister for Immigration and Border Protection (2016) 243 FCR 146 at 33 (1950) 81 CLR 161; [1950] HCA 30. 34 Associated Dominions Assurance Society Pty Ltd v Balmford (1950) 81 CLR 161 at 181 per Williams J, 181-182 per Webb J, 186-187 per Fullagar J. Bell an event such as the service of a statutory notice35, the presentation of a bankruptcy petition36, the accrual of a cause of action37 or other circumstance. Where an Act "requires or allows a thing to be done", whether expressly or by necessary implication, and the last day for doing the thing is a Saturday, a Sunday or a holiday, s 36(2) allows that the thing may be done on the next day that is not a Saturday, a Sunday or a holiday. As earlier explained, no time limit is imposed expressly or by necessary implication under the Act and the Regulations on the making of an application for a 572 visa. It is common ground that the first and second respondents' application was validly made on 13 January 2014. On that day the first respondent was not the holder of a 485 visa. He did not meet any of the criteria specified in cl 572.211(2) or (3) for the grant of a 572 visa. The last day on which the first respondent might have applied for a 572 visa relying on his status as the holder of a 485 visa was Sunday, 12 January 201438. However, recognition of that fact does not engage s 36(2). Section 36(2) states a rule with respect to the time for the doing of a thing which an Act requires or allows to be done. It does not otherwise alter the rights or obligations conferred or imposed by the Act. The language of s 36(2) cannot be read as deeming the thing to be done as if it were being done on the earlier date, nor as deeming a state of affairs that existed on the earlier date to be in existence on the later date. Orders For these reasons the following orders should be made. Appeal allowed. Set aside orders 2-4 of the orders of the Federal Court of Australia made on 23 February 2016 and in their place order that: 35 Associated Dominions Assurance Society Pty Ltd v Balmford (1950) 81 CLR 161. 36 Roskell v Snelgrove (2008) 246 ALR 175. 37 Price v J F Thompson (Qld) Pty Ltd [1990] 1 Qd R 278. 38 Since the first and second respondents' application was validly made, one avenue to the grant of 572 visas remained: following unsuccessful review before the Migration Review Tribunal (now the Administrative Appeals Tribunal), the Minister was empowered under s 351 of the Migration Act 1958 (Cth) to substitute a decision more favourable to the applicant whether or not the Tribunal had the power to make that other decision. Bell order 2 of the orders of the Federal Circuit Court of Australia made on 14 September 2015 be set aside; and the appeal to that Court otherwise be dismissed. The appellant pay the first, second and third respondents' costs of the appeal to this Court. GAGELER J. Section 36(2) of the Acts Interpretation Act 1901 (Cth) is a straightforward extension of time provision. The sub-section applies if an Act requires or allows a thing to be done and if the last day for doing the thing is a Saturday, a Sunday or a holiday. Where it applies, the sub-section allows the thing to be done on the next day that is not a Saturday, a Sunday or a holiday. The example of its operation given in the sub-section itself is instructive. The example is of a person having until 31 March to make an application and of 31 March being a Saturday. The example explains that the sub-section allows the person to make the application on Monday 2 April. Other examples of the operation of the sub-section can be given by reference to cases which have concerned its operation or the operation of cognate provisions. If an Act allows an instrument attracting stamp duty to be stamped without penalty within a month of execution and the month expires on a Sunday, the effect of the sub-section is to allow the instrument to be stamped without penalty on the following Monday39. If an Act allows a mortgagor to remedy a default by a date specified in a notice given to the mortgagor by a mortgagee in order to avoid foreclosure and the date so specified is a Sunday, the effect of the sub-section is to allow the mortgagor to remedy the default on the following Monday so as to avoid foreclosure40. If an Act requires an action for damages to be commenced within three years after a cause of action accrues and the three years expires on a holiday, the effect of the sub-section is to allow an action to be commenced on the next day that is not a Saturday, a Sunday or another holiday41. If an Act allows for the making of an order by a court extending the period at the expiration of which a creditor's petition will lapse at any time before the expiration of the period of 12 months from the date of presentation of the petition and that latter period expires on a holiday, the court can make the order on the next day that is not a Saturday, a Sunday or another holiday42. Those examples do not exhaust the operation of the sub-section. They do illustrate when and how the sub-section operates. The sub-section operates when an Act expressly or by implication requires or allows something to be done within a period of time and where that period expires on a Saturday, a Sunday or a holiday. The sub-section then operates to extend the period within which the thing might be done to the next day that is not a Saturday, a Sunday or a holiday: 39 Eg Wall v Commissioner of Stamps (1899) 18 NZLR 74. 40 Eg Price v Williams [1979] 2 NZLR 374 at 376-377. 41 Eg Thomson v Les Harrison Contracting Co [1976] VR 238. Cf Price v J F Thompson (Qld) Pty Ltd [1990] 1 Qd R 278. 42 Eg Roskell v Snelgrove (2008) 246 ALR 175. it gives to the thing if done on that next day the same legal effect as the thing would have had if the thing had been done within the period required or allowed by the Act. That is the long and the short of it. The first respondent seeks to make the sub-section do more. He seeks to make the sub-section applicable to his circumstances by characterising, as a thing which the Migration Act 1958 (Cth) allowed to be done, the making by him under s 45 of an application for a Student (Temporary) (Class TU) Subclass 572 (Vocational Education and Training Sector) visa that was capable of being granted by the Minister under s 65(1). The visa the subject of the application could only be granted if the Minister were able to be satisfied under s 65(1)(a)(ii) of the criteria prescribed under s 31(3) by cl 572.211 of Sched 2 to the Migration Regulations 1994 (Cth). The last day on which he could make an application capable of being so granted on the basis of the Minister's satisfaction of the criterion prescribed by cl 572.211(2) was the last day on which he still held his Subclass 485 (Temporary Graduate) visa. The first respondent argues that, as that day was a Sunday, s 36(2) of the Acts Interpretation Act operated to allow him to make the application on the following Monday. The problem with the argument is that it conflates the thing allowed to be done by the first respondent with the things required to be done by the Minister. The thing allowed to be done by the first respondent was the making of a valid application for the visa under s 45. The things required to be done by the Minister, following the making of a valid application, were consideration of the application under s 47 and the making of a decision under s 65(1) either to grant the visa under s 65(1)(a), if satisfied relevantly that the criteria prescribed by cl 572.211 were met, or to refuse to grant the visa under s 65(1)(b) if not so satisfied. Nothing in the Migration Act imposed any limit on the time for the making by the first respondent of a valid application under s 45 for a Subclass 572 (Vocational Education and Training Sector) visa. Irrespective of whether the first respondent made it on the Sunday on which he still held his Subclass 485 (Temporary Graduate) visa or on the following Monday, the making by him of a valid application had the same legal effect. The making of the application required the Minister to consider the application under s 47 and to make a decision under s 65(1). The circumstance of the application having been made on the Monday meant that the criterion prescribed by cl 572.211(2) could not be met and the Minister was obliged by s 65(1)(b) to refuse to grant the visa. Section 36(2) was not engaged, and had no relevant operation. Zangzinchai v Millanta43, in my opinion, was quite a different case. Section 36(2) in an earlier form was there held by majority to be inapplicable to a 43 (1994) 53 FCR 35. provision addressed to when an applicant for a visa might apply to the Immigration Review Tribunal for review of a decision to refuse a visa44. The provision was not addressed to the criteria for the grant of a visa. The correctness of the conclusion of the majority in that case is contestable. To reject it would be to say nothing of the correct conclusion in this case. For these reasons, I would allow the appeal and make the consequential orders proposed by the plurality. 44 Regulation 21(3)(a) of the Migration (Review) Regulations 1989 (Cth). Nettle NETTLE J. Section 65 of the Migration Act 1958 (Cth) provides, inter alia, that, if the Minister for Immigration and Border Protection (the appellant in this Court, hereinafter "the Minister") is satisfied that a visa application satisfies the criteria prescribed by the Migration Act or the Migration Regulations 1994 (Cth) ("the Regulations"), the Minister is to grant the visa or, if not so satisfied, to refuse the visa. Clause 572.211 of Sched 2 to the Regulations relevantly provides that the criteria to be satisfied at the time of application for a Subclass 572 (Vocational Education and Training Sector) visa include that the applicant is the holder of a Subclass 485 (Temporary Graduate) visa. The first respondent ("Mr Kumar") was the holder of a Subclass 485 visa that expired on Sunday, 12 January 2014. On Friday, 10 January 2014, Mr Kumar posted an application for a Subclass 572 visa to the Department of Immigration and Border Protection. The application was not received by the Department until Monday, 13 January 2014, one day after Mr Kumar's Subclass 485 visa had expired. It was common ground between the parties that the date Mr Kumar's application was made for the purposes of the Migration Act and the Regulations was the date that it was received by the Department, that is, Monday, 13 January 2014. On 16 May 2014, a delegate of the Minister refused Mr Kumar's application for a Subclass 572 visa on the ground that, because his Subclass 485 visa had expired one day before the Department received the application, Mr Kumar was not the holder of a Subclass 485 visa at the time of application for a Subclass 572 visa. Mr Kumar's wife, whose visa application was practically dependent on that of her husband, and their son are also respondents to this appeal45. The question for decision is whether s 36(2) of the Acts Interpretation Act 1901 (Cth) operated so as to extend, until Monday, 13 January 2014, the time in which Mr Kumar was allowed to make an application for a Subclass 572 visa that was capable of being granted under s 65 of the Migration Act. For the reasons which follow, that question should be answered, yes. History of the litigation Mr Kumar applied to the Migration Review Tribunal for review of the delegate's decision to refuse his application for a Subclass 572 visa. After a 45 Mr Kumar and his wife applied to the Migration Review Tribunal for review of the delegate's decision. Mr Kumar, his wife and their son sought judicial review of the Tribunal's decision in the Federal Circuit Court of Australia, and then appealed the Federal Circuit Court's decision to the Federal Court of Australia. It will be convenient throughout to only refer to Mr Kumar. Nettle hearing, the Tribunal affirmed the delegate's decision. The Tribunal made no reference to s 36(2) of the Acts Interpretation Act. Mr Kumar applied for judicial review of the Tribunal's decision in the Federal Circuit Court of Australia. Judge Street concluded46 that he was bound by the decision of the Full Court of the Federal Court of Australia in Zangzinchai v Millanta47 to hold that cl 572.211 of Sched 2 to the Regulations is not a provision that requires or allows a thing to be done within the meaning of s 36(2) of the Acts Interpretation Act, but is rather a provision that identifies a state of affairs that must exist at the time of application for a visa, and thus a provision to which s 36(2) of the Acts Interpretation Act has no application. His Honour accordingly dismissed Mr Kumar's application. Mr Kumar then appealed to the Federal Court of Australia. North J allowed the appeal, holding48 that, as a result of amendments to s 36 of the Acts Interpretation Act since Zangzinchai was decided, s 36(2) so operated in this case as to allow Mr Kumar to lodge his application for a Subclass 572 visa on Monday, 13 January 2014, as if he had lodged it the day before. By grant of special leave, the Minister appeals to this Court. Section 29(1) of the Migration Act empowers the Minister to grant visas permitting non-citizens to travel to and enter Australia and/or remain in Australia. Section 31(3) of the Migration Act provides that the Regulations may prescribe criteria for a visa or a specified class of visa. Section 45 provides that, generally, a non-citizen who wants a visa must apply for a visa of a particular class. 46 Kumar v Minister for Immigration [2015] FCCA 2573 at [13]-[14]. 47 (1994) 53 FCR 35. 48 Kumar v Minister for Immigration and Border Protection (2016) 243 FCR 146 at 49 Notwithstanding this judgment's use of the present tense, the description of the operation of the legislation is of its operation as at January 2014. Nettle Section 65 provides, so far as is relevant, as follows: "Decision to grant or refuse to grant visa (1) After considering a valid application for a visa, the Minister: if satisfied that: the health criteria for it (if any) have been satisfied; and the other criteria for it prescribed by this Act or the regulations have been satisfied; ... is to grant the visa; or if not so satisfied, is to refuse to grant the visa." Schedule 2 to the Regulations relevantly provides as follows: "572.21—Criteria to be satisfied at time of application If the application is made in Australia, the applicant meets the requirements of subclause (2) ... (2) An applicant meets the requirements of this subclause if the applicant is: the holder of a visa of one of the following subclasses: (iia) Subclass 485 (Temporary Graduate)". The decision in Zangzinchai At the time of the decision in Zangzinchai, s 36(2) of the Acts Interpretation Act was as follows: Nettle "Where the last day of any period prescribed or allowed by an Act for the doing of anything falls on a Saturday, on a Sunday or on a day which is a public holiday or a bank holiday in the place in which the thing is to be or may be done, the thing may be done on the first day following which is not a Saturday, a Sunday or a public holiday or bank holiday in that place." In Zangzinchai, the applicant was the holder of a temporary entry permit that expired on Sunday, 1 March 1992. He applied for an extended entry permit the following day. His application was refused and he sought a review of that decision. Under the terms of the applicable legislation, an applicant for an entry permit could apply for review of a decision only if the applicant was "lawfully present in Australia, when he or she lodged the application"50. The majority of the Full Court (Neaves and Beazley JJ) held that the decision was not a reviewable decision because the applicant's existing temporary entry permit had expired on the Sunday, one day before he lodged the application for an extended entry permit, and, therefore, because the applicant was not lawfully present in Australia when he lodged the application51. Their Honours endorsed a passage from an earlier decision of the Immigration Review Tribunal to the effect that s 36(2) of the Acts Interpretation Act did not apply because52: "its application depends, according to the terms of the section, upon the prescription of a period for the doing of something and the Act and Regulations do not contain any such prescription of time for the making of an application for an entry permit. An application for a further temporary entry permit may be made at any time, even if, as in the present case, the applicant is an illegal entrant in which case however certain further criteria must be satisfied. The lawful status of a non-citizen cannot exist without, and is a quality arising from, the possession of an entry permit. Therefore lawful status is lost by a temporary resident as a passive act through the expiry of an entry permit and can only be regained or maintained by the grant of, and not the application for, a further temporary entry permit in respect of which, as already noted, there is no time prescription in the Act or Regulations." (emphasis in original) Burchett J dissented. His Honour held53 that the application of s 36(2) was not confined to cases in which legislation "prescribed" a period for the doing 50 Zangzinchai (1994) 53 FCR 35 at 36-37. 51 Zangzinchai (1994) 53 FCR 35 at 38-39. 52 Re Sekido unreported, Immigration Review Tribunal, 6 March 1992 at 9 per Senior Member L Certoma, quoted in Zangzinchai (1994) 53 FCR 35 at 39. 53 Zangzinchai (1994) 53 FCR 35 at 42, 44. Nettle of a thing but extended also to instances where legislation "allowed" a period of time for the doing of a thing. In his Honour's view, legislation could be said to "allow" a period of time for the doing of a thing, even if it did not in terms precisely prescribe such a period, so long as it indirectly established a period in which the thing was to be done. So construed, his Honour concluded54, s 36(2) was to be understood as permitting the application for an extended entry permit to be lodged "as an effective application, on the Monday or other applicable day". The reasoning of the Court below In 201155, s 36 of the Acts Interpretation Act was amended to its present form, such that it now reads, relevantly, as follows: "Calculating time an Act requires or allows a thing to be done; and the last day for doing the thing is a Saturday, a Sunday or a holiday; then the thing may be done on the next day that is not a Saturday, a Sunday or a holiday. Example: If a person has until 31 March to make an application and 31 March is a Saturday, the application may be made on Monday 2 April. In this section: holiday, in relation to the time for doing a thing, means: a day that is a public holiday in the place in which the thing is to be or may be done; and 54 Zangzinchai (1994) 53 FCR 35 at 48. 55 Acts Interpretation Amendment Act 2011 (Cth), Sched 1, item 93. Nettle if the thing is to be or may be done at a particular office or other place  a day on which the place or office is closed for the whole day." In the Federal Court, North J held that the reasoning of the majority in Zangzinchai does not apply to the amended form of s 36(2), because56: "[t]he previous version of the section operated on a period prescribed, or allowed, by an Act, whereas the current version operates on a broader set of circumstances where an Act requires or allows a thing to be done." His Honour concluded that the amended form of s 36(2) "allows the thing in question to be done; that is to say, it allows for the thing to be effectuated on the later date as if it were being done on the earlier date"57. The Minister's contentions Before this Court, the Minister contended that North J's construction of s 36(2) is plainly wrong. In the Minister's submission, the Explanatory Memorandum relating to the 2011 amendment leaves no room for doubt that the purpose of the amendment was "not substantively [to] change the existing policy" of the provision but rather only to make it "more user friendly"58. It follows, in the Minister's submission, that s 36(2) in its amended form is to be construed just as it was construed by the majority in Zangzinchai in its pre-amendment form. In the Minister's submission, North J's construction of s 36(2) should further be rejected because it would radically alter the criteria applicable to the grant of a Subclass 572 visa. It would mean that, despite the express statutory requirement that an applicant for a Subclass 572 visa be the holder of a Subclass 485 visa at the time of application, an applicant could succeed in an application for a Subclass 572 visa without being the holder of a Subclass 485 visa at the time of application. In the Minister's submission, it cannot be supposed that that is the purpose or effect of s 36(2). 56 Kumar (2016) 243 FCR 146 at 151 [24]. 57 Kumar (2016) 243 FCR 146 at 149 [15]. 58 Australia, House of Representatives, Acts Interpretation Amendment Bill 2011, Explanatory Memorandum at 35 [225]. Nettle The Minister also contended that North J's construction of s 36(2) is contrary to the way in which s 36(2) was construed in Re Tavella59 and by this Court in Associated Dominions Assurance Society Pty Ltd v Balmford60. Consideration The effect of the 2011 amendment to s 36(2) With respect, there appears to be some force in North J's conclusion that the 2011 amendment brought about a substantive change to the operation of s 36(2). Standard dictionary definitions of "prescribe"61 and "require"62 suggest that prescription involves a more explicit stipulation than requirement; the distinction deriving in part from the etymological root of "prescribe", praescribere, connoting a direction in writing63. It appears also to be of significance that the provision as amended no longer refers to a "period" allowed by an Act. As amended, it presents as capable of application to a situation in which an Act has the practical effect of requiring or allowing a thing to be done by a particular "last day" without necessarily setting out a last day before which the thing is to be done. There is some support for that notion, too, in the example of the intended operation of the provision, which appears in the Act immediately below sub-s (2), and particularly in the general phrasing of the imperative: "Example: If a person has until 31 March to make an application and 31 March is a Saturday, the application may be made on Monday 2 April." (emphasis added) Admittedly, as the Minister submitted, the Explanatory Memorandum states that the amendment did "not substantively change the existing policy"64. 59 (1953) 16 ABC 166. 60 (1950) 81 CLR 161; [1950] HCA 30. 61 See, for example, The Oxford English Dictionary, 2nd ed (1989), vol 12 at 390-391; The Australian Oxford Dictionary, 2nd ed (2004) at 1020; Black's Law Dictionary, 10th ed (2014) at 1373. 62 See, for example, The Oxford English Dictionary, 2nd ed (1989), vol 13 at 681-682; The Australian Oxford Dictionary, 2nd ed (2004) at 1095; Black's Law Dictionary, 10th ed (2014) at 1498. 63 Partridge, Origins: A Short Etymological Dictionary of Modern English, 4th ed 64 Australia, House of Representatives, Acts Interpretation Amendment Bill 2011, Explanatory Memorandum at 35 [225]. Nettle But considered changes to the text of a legislative provision cannot be overridden by an executive pronouncement65. And, far from supporting the Minister's preferred construction, the Explanatory Memorandum also records that the amendment was "intended to capture a broader range of situations"66. Accordingly, as at present advised, I would not exclude the possibility that the changes made by the 2011 amendment were sufficient reason to depart from the reasoning in Zangzinchai. For present purposes, however, it is unnecessary to decide that point, because, even if the 2011 amendment did not alter the substantive effect of s 36(2), there are compelling reasons to depart from the reasoning in Zangzinchai as to the application of s 36(2) to ss 45 and 65 of the Migration Act. The application of s 36(2) As was earlier recorded, s 36(2) of the Acts Interpretation Act applies where an Act requires or allows a thing to be done and the last day for doing the thing is a Saturday, a Sunday or a holiday. Relevantly, s 45 of the Migration Act allows a thing to be done, namely, a non-citizen to apply for a visa of a particular class, in this case a Subclass 572 visa. Section 45 does not specify the last day for making such an application, but cl 572.211 of Sched 2 to the Regulations, coupled with s 65 of the Migration Act, relevantly mandates that the Minister cannot grant an application for a Subclass 572 visa unless at the time of application the applicant is the holder of a Subclass 485 visa. Axiomatically, a "Subclass 485 (Temporary Graduate)" visa is only ever issued on a temporary basis and thus for a period of time that must expire. It follows that it is a criterion for acceptance of an application for a Subclass 572 visa that "at time of application" the applicant's most recently issued Subclass 485 visa has not expired. As will be explained later in these reasons, that is a sufficient basis to conclude that, within the meaning of s 36(2) of the Acts Interpretation Act, the Migration Act (specifically ss 45 and 65, combined with cl 572.211 of Sched 2 to the Regulations) allows an applicant to make an application for a Subclass 572 visa that is capable of being granted under s 65 only if the application is made before the applicant's most recently issued Subclass 485 visa expires. It will be recalled that the majority in Zangzinchai held that s 36(2) in its pre-amendment form did not apply to an application for an entry permit because 65 Re Bolton; Ex parte Beane (1987) 162 CLR 514 at 518 per Mason CJ, Wilson and Dawson JJ; [1987] HCA 12; Lacey v Attorney-General (Qld) (2011) 242 CLR 573 at 598 [61] per French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ; [2011] HCA 10. 66 Australia, House of Representatives, Acts Interpretation Amendment Bill 2011, Explanatory Memorandum at 35 [224]. Nettle "its application depends, according to the terms of the section, upon the prescription of a period for the doing of something and the [Migration Act] and Regulations do not contain any such prescription of time for the making of an application for an entry permit"67. So to approach the construction of s 36(2) is unduly limited. Section 36(2) in its pre-amendment form was not limited only to cases in which a section of an Act prescribed a period for the doing of a thing. It applied also where an Act allowed a period for the doing of a thing and, as Burchett J observed, what an Act allows is a broader concept than what it prescribes. As his Honour put it68: "On the face of the provision, the use of the expression, 'or allowed by an Act', makes it clear that s 36(2) applies where, according to the true construction of an Act, a period is allowed for the doing of something; it is not necessary to find a provision prescribing in terms that something shall be done within a particular period. That the subsection is not concerned with the formulation of a prescription is also made clear by the way it operates. It does not say that a statement of a period shall be read as extending to the day after a Sunday etc. It is not so tied to the manner in which an Act may be drafted. (That could have been seen as involving possibly fortuitous limitations upon the scope of the Acts Interpretation Act.) Instead, it goes to the substance, providing that 'the thing may be done on the first day following …'. I think this provision must be construed as meaning 'done effectively', and that it should be given its full impact upon the substance of what other legislation, to be interpreted in the light of the Acts Interpretation Act, may allow." (emphasis in original) At the time of the enactment of the Acts Interpretation Act in 1901, there were provisions comparable to s 36(2) in several of the Australian States and in New Zealand. As Burchett J observed69, and the margin notes of the Acts Interpretation Act recorded, s 36 was closely based on s 35 of the Interpretation Act 1897 (NSW)70. It was also similar in form to s 24(1) of the Interpretation in Wall v Act 1888 (NZ). Commissioner of Stamps71. The question in that case was whether s 24(1) of the Interpretation Act 1888 had the effect of extending the time in which an latter provision fell for consideration The 67 Zangzinchai (1994) 53 FCR 35 at 39, quoting with approval from Re Sekido unreported, Immigration Review Tribunal, 6 March 1992 at 9. 68 Zangzinchai (1994) 53 FCR 35 at 42. 69 Zangzinchai (1994) 53 FCR 35 at 41. 70 See also Acts Shortening Act 1858 (NSW), s 11. 71 (1899) 18 NZLR 74. Nettle instrument could be stamped without penalty under the Stamp Act 1882 Amendment Act 1885 (NZ) ("the Stamp Act"). Section 24(1) of the Interpretation Act 1888 provided that: "If the time limited by any Act for any proceeding, or the doing of anything under its provisions, expires or falls upon a holiday, the time so limited shall be extended to, and such thing may be done on, the day next following which is not a holiday ..." Section 4 of the Stamp Act relevantly provided that: "any unstamped or insufficiently-stamped instrument may be stamped or further stamped by the Commissioner after the first execution thereof, on payment of the unpaid duty and fine in addition to the duty as follows: (1) When such instrument is presented to be stamped more than one month and less than three months after execution, a fine of twenty-five per centum on the amount of duty payable. (2) When such instrument is presented to be stamped more than three months after execution, a fine of one hundred per centum on the amount of the duty payable ..." Stout CJ concluded that s 4 of the Stamp Act could be regarded as a provision which limited the time for the doing of a thing under the statute, namely, stamping an instrument without penalty, and that s 24(1) of the Interpretation Act 1888 "applies just as much as in any other case of the time limited for the doing of an act expiring on a Sunday"72. Although s 4 of the Stamp Act did not provide in terms that an instrument had to be, or could only be, stamped within a specified period of time  it was permissible to stamp an instrument at a later time on payment of a penalty as specified in sub-s (1) or sub-s (2)  the effect of s 4 of the Stamp Act was, in substance, to allow an instrument to be stamped without penalty, or with a lesser penalty, within a specified period of time and that was enough to qualify the provision as one which limited the time for the doing of anything within the meaning of s 24(1) of the Interpretation Act 1888. As Burchett J also observed in Zangzinchai73, a later version of s 24(1) of the Interpretation Act 1888 was similarly construed by the New Zealand Court of Appeal in Price v Williams74. The issue there was whether s 25(a) of the Acts 72 Wall (1899) 18 NZLR 74 at 77. 73 (1994) 53 FCR 35 at 46-47. 74 [1979] 2 NZLR 374. Nettle Interpretation Act 1924 (NZ) applied to a notice of default given under s 92 of the Property Law Act 1952 (NZ). Section 25(a) of the Acts Interpretation Act 1924 provided that, if the time limited by any Act for the doing of anything under its provisions expired or fell upon a holiday, the time so limited should be extended to the day next following which was not a holiday. Section 92 of the Property Law Act provided that a power under a mortgage to sell land or enter into possession of land was not to become exercisable unless and until the mortgagee served a notice of not less than one month, specifying the default and a date on which the power would become exercisable and requiring the owner to remedy the default. The New Zealand Court of Appeal held that, although s 92 of the Property Law Act did not directly impose a time limit, it did so indirectly by providing for a date to be fixed in the notice and by stipulating that the power of sale could only be exercised on or after that date75. In substance, the provision required that the remedying of the default be done before that date, and in that way it limited the time in which the default could be remedied. Accordingly, because the time limit for remedying the default fell on a Sunday, the mortgagor in that case could, perforce of s 25(a) of the Acts Interpretation Act 1924, effectively remedy the default on the following Monday. In Thomson v Les Harrison Contracting Co76, Harris J applied similar reasoning to the application of s 31A(1) of the Acts Interpretation Act 1958 (Vic) to s 5(6) of the Limitation of Actions Act 1958 (Vic). Section 31A(1) of the Acts Interpretation Act 1958 provided in terms that: "Where the time limited by any Act for the doing of any act or thing expires or falls upon a holiday the act or thing may be done on the day next following that is not a holiday." Section 5(6) of the Limitation of Actions Act provided in terms that: "No action for damages ... shall be brought after the expiration of three years after the cause of action accrued." On the facts in Les Harrison Contracting, the three years provided for in s 5(6) expired on a holiday. Hence, the question was whether s 31A(1) of the Acts Interpretation Act 1958 could be relied upon to extend the time for the issue of a writ to the next day following that was not a holiday. Harris J held77 that, although s 5(6) of the Limitation of Actions Act did not in terms provide for "the time limited" for the bringing of an action, it would be artificial to confine the application of s 31A(1) only to provisions which expressly provide for "the time limited". It accorded with the evident purpose of the provision to construe it as applying also to provisions which, not in terms or directly, but in substance or indirectly, limited the time in which something was to be done. 75 Price v Williams [1979] 2 NZLR 374 at 376-377. 77 Les Harrison Contracting [1976] VR 238 at 242-243. Nettle Parity of reasoning dictates that ss 45 and 65 of the Migration Act, and cl 572.211 of Sched 2 to the Regulations, should be approached in the same way. By allowing a non-resident to make an application for a visa of a particular class, and by providing that an application not be capable of grant under s 65 unless it satisfies the criteria prescribed by the Regulations (one of which was, in this case, that the applicant be the holder of a current Subclass 485 visa), ss 45 and 65 together "allow" a non-citizen who is the holder of a current visa as required by the Regulations to make a visa application and indirectly limit the time in which that may be done to the period during which the applicant's current visa remains in force. Significantly, in this case, the Minister did not attempt to confront the reasoning in Wall, Price v Williams or Les Harrison Contracting. Instead, counsel for the Minister asserted, without explanation, that s 36(2) has no work to do in circumstances where a statutory provision attaches a particular consequence to the existence of certain facts at a particular time. So to contend is to divert attention from the enquiry required by s 36(2). If the statutory imposition of such consequences serves to require or allow a thing to be done by a particular time, s 36(2) may be engaged. There are also textual indications in cl 572.211 of Sched 2 to the Regulations that support that approach. The criteria in cl 572.211(2) and (3) may be seen as, in effect, directed towards two alternatives, one where an applicant's visa is still in force and the other where an applicant's visa has expired. Clause 572.211(2)(d)(iii) provides that an applicant for visa satisfies the conditions of that sub-clause if, "at time of application", the applicant is the holder of a Subclass 497 (Graduate  Skilled) visa, which is a substantive visa. Clause 572.211(3)(a), (b)(v) and (c)(i), taken together, provide that an applicant also satisfies the conditions of the sub-clause78 if, at time of application, the applicant is no longer the holder of a substantive visa, but the application is made within 28 days of the day when the last substantive visa ceased to be in effect. The former provision provides in terms for the criteria of acceptability where an application for visa is made while the last substantive visa remains current. The latter provisions provide in terms for the criteria of acceptability where an application for visa is made within 28 days of the last substantive visa ceasing to be current. Both provide for the time in which an acceptable application for visa may be made. And, since cl 572.211(2)(d)(iia) is in form identical to cl 572.211(2)(d)(iii), except that the former refers to a "Subclass 485 (Temporary Graduate)" visa and the latter to a "Subclass 497 (Graduate  Skilled)" visa, it is natural to conceive of cl 572.211(2)(d)(iia) as applying to a Subclass 485 visa in the same way that cl 572.211(2)(d)(iii) applies to a Subclass 497 visa; which is to 78 Migration Regulations, Sched 2, cl 572.211(1). Nettle say, by providing for the period in which an acceptable application for visa may be made. A deeming or fiction? It was contended on behalf of the Minister that to construe ss 45 and 65 of the Migration Act, for the purpose of s 36(2) of the Acts Interpretation Act, as allowing a thing to be done and as providing for the time in which that thing is to be done would involve a deeming or fiction that an applicant for visa whose previous Subclass 485 visa has in fact expired at the time of application is still the holder of a current Subclass 485 visa at the time the application is received on the next following business day. forced a construction of That submission is unpersuasive. Treating ss 45 and 65 of the Migration Act as providing for a time in which something is to be done involves no more deeming or fiction than characterising the express requirement that an applicant be the holder of a Subclass 485 visa at the time of application as a necessarily implied requirement that the application for visa be made before the expiry of the applicant's last issued Subclass 485 visa. In principle, that is no different from, and no more cl 572.211(2)(d)(iia) than, characterising a prohibition against a mortgagee entering into possession of mortgaged premises before expiration of a specified period of notice as a provision which allows the mortgagor to remedy a default within the specified period of notice79. It is no more an artificial exercise in deeming or fiction than treating a provision that a cause of action shall not be brought more than a specified number of years after the accrual of the cause of action as a provision which allows an action to be brought within that time80. Nor is it any more an artificial exercise in deeming or fiction than to say of a provision that a class of instrument may be stamped without penalty, or with a lesser penalty, within a specified period of time following execution, that it is a provision which allows a thing to be done and limits the time in which it may be done81. the criterion specified Granted, the above examples involve statutory provisions which specifically identified a period of time in which something could be done with particular consequences. Sections 45 and 65 of the Migration Act and cl 572.211 of Sched 2 to the Regulations do not do that in terms. But they do specifically refer to criteria that must be satisfied at the time of application in order to attract a particular consequence, namely, that the application is capable of being granted 79 See and compare Price v Williams [1979] 2 NZLR 374. 80 See and compare Les Harrison Contracting [1976] VR 238. 81 See and compare Wall (1899) 18 NZLR 74. Nettle by the Minister under s 65. One of those criteria, and the one enlivened in this case, is that an applicant be the holder of a Subclass 485 visa "at time of application". As previously observed, a Subclass 485 visa is a temporary visa which is issued for a finite period of time. Relevantly, therefore, the criterion of an application for visa that is capable of being granted under s 65 is that the application be made before the applicant's last issued Subclass 485 visa has expired. It follows  to adopt and adapt the language of de Jersey J in Price v J F Thompson (Qld) Pty Ltd82  that, although ss 45 and 65 and cl 572.211 are cast in the form of a criterion of acceptability, they no less prescribe a period of time. By providing that it is a criterion of acceptability that an applicant be the holder of a Subclass 485 visa at the time of application, ss 45 and 65 and cl 572.211 carry with them the ineluctable corollary that an application for visa which is capable of being granted must be made before the expiration of the applicant's most recently issued Subclass 485 visa. That is the necessary implication of the criterion of acceptability and so it must be regarded as part of what ss 45 and 65 and cl 572.211 provide. To say otherwise is to deny the natural and ordinary effect of the provisions. The Minister further contended that, even so, it would be improper to characterise the operation of ss 45 and 65 as such because deeming an applicant who is not in fact the holder of a Subclass 485 visa at the time of application to have been the holder of a Subclass 485 visa at the time of application would work a radical change to the operation of the statutory criteria of acceptability. That submission is also unpersuasive. As is illustrated in part by the examples already given, in truth most applications of s 36(2) of the Acts Interpretation Act or cognate provisions involve a coordinate degree of deeming or fiction which affects the operation of the subject statutory criteria. In the case of provisions for the stamping of instruments without penalty, application of s 36(2) or a cognate provision involves the fiction that an instrument, which is in fact not lodged for stamping until after the expiration of the penalty-free period, is lodged for stamping before the expiration of the penalty-free period. That affects the subject statutory criteria by extending the period for stamping. In the case of provisions prohibiting the entry of a mortgagee into possession until after a specified period of notice of default has been given, application of s 36(2) or a cognate provision involves the fiction that, despite the requisite period of notice having been given, the mortgagee is to be taken as having not given the requisite period of notice until the business day next following the Saturday, Sunday or public holiday on which the requisite period of notice expired. That affects the subject statutory criteria by extending the period for rectification. In the case of provisions for the limitation of actions, application of s 36(2) or a cognate provision involves the 82 [1990] 1 Qd R 278 at 286. Nettle fiction that a limitation period that in fact expires on a Saturday, Sunday or public holiday is as yet still unexpired on the next business day. And that affects the subject statutory criteria by extending the period in which action may be brought. The effect upon subject statutory criteria of such deeming or fiction as results from the operation of s 36(2) or a cognate provision on each of those provisions cannot be regarded an unlikely or unintended consequence. Mutatis mutandis, the same holds for the effect upon statutory criteria of such deeming or fiction as results from the operation of s 36(2) on ss 45 and 65 and cl 572.211. Decisions in Re Tavella and Balmford A good deal was made in the Minister's written submissions before this Court, as it was before the Court below, of the decision of Clyne J in Re Tavella as to the inapplication of s 36(2) of the Acts Interpretation Act to the legislative predecessor to s 44(1)(c) of the Bankruptcy Act 1966 (Cth). In similar terms to s 44(1)(c), the predecessor provision83 forbade the presentation of a bankruptcy petition unless "the act of bankruptcy on which the petition is grounded has occurred within six months before the presentation of the petition". Clyne J held84 that the provision did not prescribe a day for presenting a petition, and accordingly that, although the day six months after the act of bankruptcy was a Sunday, s 36(2) of the Acts Interpretation Act did not operate so as to extend the date for presentation of the petition to the following Monday. Re Tavella does not have the significance which the Minister sought to attribute to it. As Burchett J noticed in Zangzinchai85, the reasoning in Re Tavella is problematic in that it was based on decisions86 that have since been doubted or in some instances expressly disapproved87; and, indeed, counsel for the Minister in this Court conceded that the reasoning in Re Tavella is at best opaque. 83 Bankruptcy Act 1924 (Cth), s 55(1)(c). 84 Re Tavella (1953) 16 ABC 166 at 168. 85 (1994) 53 FCR 35 at 44-45. 86 Déchène v City of Montreal [1894] AC 640; Gelmini v Moriggia [1913] 2 KB 549; M'Niven v Glasgow Corporation 1920 SC 584. 87 See Hodgson v Armstrong [1967] 2 QB 299 at 319-321 per Davies LJ, cf at 323-324 per Russell LJ dissenting; Pritam Kaur v S Russell & Sons Ltd [1973] QB 336 at 349 per Lord Denning MR, 353, 355 per Megarry J; Price v J F Thompson [1990] 1 Qd R 278 at 284 per Moynihan J, cf at 282 per Carter J dissenting. See also Marren v Dawson Bentley & Co Ltd [1961] 2 QB 135 at 141-143; The Clifford Maersk [1982] 1 WLR 1292; [1982] All ER 905. Nettle More importantly, however, there is no reason in principle to confine the application of s 36(2) of the Acts Interpretation Act to legislation which in terms, or, in other words, "directly", allows for a thing to be done within a specified period of time. Although the central aim of statutes like the Acts Interpretation Act is the facilitation of consistency in statutory construction88 and the avoidance of unnecessary repetition89, it does not follow that a particular provision within such a statute may not have a particular, different purpose. In order to appreciate the particular purpose of s 36(2), it is necessary to have regard to the legislative history of the provision and ultimately to the common law rule of statutory interpretation from which it derives. Once that historical context is understood, it can be seen that the provision is essentially remedial in nature and thus aptly described as providing a "safeguard"90 for persons required or allowed to do a thing by the operation of an Act. Remedial legislation like s 36(2) should be construed in a manner that gives effect to the remedy and secures the result which it is the purpose of the legislation to achieve91. It follows, as is demonstrated by the decision of the New Zealand Court of Appeal in Price v Williams, that a provision like s 36(2) is logically to be understood as applying as much to legislation that in substance, or "indirectly"92, allows for a thing to be done within a specified period of time as to a provision which in terms, or directly, allows for a thing to be done within a specified period of time. That point is further emphasised by the decision of the Full Court of the Supreme Court of Queensland in Price v J F Thompson93. 88 See Hands v Law Society (1890) 17 Ont App 41 at 57, where Burton JA observed: "I think the passing of such an Act may be regarded as a gentle intimation by the Legislature to the Courts that it understands what it is saying and means what it says." Cf In the Matter of The Fourth South Melbourne Building Society (1883) 9 VLR (E) 54 at 58. 89 Attorney-General (Q) v Australian Industrial Relations Commission (2002) 213 CLR 485 at 492 [7] per Gleeson CJ; [2002] HCA 42. 90 Elan Copra Trading Pty Ltd v JK International Pty Ltd (2005) 226 ALR 349 at 359 [36] per White J (Doyle CJ and Perry J agreeing at 350 [1], [2]). 91 Butler (or Black) v Fife Coal Co Ltd [1912] AC 149 at 178-179 per Lord Shaw of Dunfermline; Mathews v Foggitt Jones Ltd (1926) 37 CLR 455 at 464 per Isaacs J; [1926] HCA 13. 92 Price v Williams [1979] 2 NZLR 374 at 376, 377. 93 [1990] 1 Qd R 278. See also Re Eid and Secretary, Department of Families, Housing, Community Services and Indigenous Affairs (2013) 138 ALD 180 at Nettle Possibly, there may be some reason in policy to adopt a different approach in the case of bankruptcy legislation94. Depending on its terms, character and any necessary implication95, it may be that such legislation evinces an intention to displace s 36(2)96. Alternatively, it may be that the purpose of 36(2) should be seen as confined to conferring an advantage on persons required or permitted to do something within a period of time, as opposed to persons having power to impose duties or obligations on other persons97. Leastways, that is how some scholars have understood the holding in Balmford98 and it accords with the rationale of the common law rule of construction from which s 36(2) derives99. The result in Re Tavella, albeit not Clyne J's reasoning, is consistent with that sort of approach. By contrast, however, there is nothing in principle or policy about ss 45 and 65 of the Migration Act that warrants a restrictive approach to the application of s 36(2) of the Acts Interpretation Act. Sections 45 and 65 do not in any sense provide for a visa applicant to impose a duty on another person. They allow an applicant to make an application for visa that is capable of being granted under s 65 during the currency of the applicant's most recently issued visa. There is no reason in principle or policy why s 36(2) should not apply. The Minister's reliance on the decision of this Court in Balmford is equally misplaced. In Balmford, the question was whether s 36(2) so operated as to validate an invalid notice served by the Insurance Commissioner on an insurance company under s 55(1) of the Life Insurance Act 1945 (Cth). Section 55(2) of the Life Insurance Act provided that, if the company failed to show cause within the period of not less than 14 days specified in the notice, the 94 Cf Roskell v Snelgrove (2008) 246 ALR 175 at 182-183 [44]-[47]. 95 Pfeiffer v Stevens (2001) 209 CLR 57 at 73-74 [56] per McHugh J; [2001] HCA 71. See also Blue Metal Industries Ltd v Dilley (1969) 117 CLR 651 at 656; [1970] AC 827 at 846. 96 Acts Interpretation Act, s 2(2). 97 Wignalls Smallgoods Pty Ltd v Kent (2002) 10 Tas R 460 at 465 [18] per Slicer J (Crawford J agreeing at 461 [1], Evans J agreeing at 465 [22]). See and compare Pritam Kaur [1973] QB 336 at 353 per Megarry J. 98 Pearce and Geddes, Statutory Interpretation in Australia, 8th ed (2014) at 299 99 See, for example, In re North; Ex parte Hasluck [1895] 2 QB 264 at 270 per Lord Escher MR; Pritam Kaur [1973] QB 336 at 353-356 per Megarry J; Mucelli v Government of Albania [2009] 1 WLR 276 at 298 [84] per Lord Neuberger of Abbotsbury; [2009] 3 All ER 1035 at 1058; R (Modaresi) v Secretary of State for Health [2013] 4 All ER 318 at 329 [33] per Baroness Hale of Richmond. Nettle Commissioner could proceed to make an investigation of the company's business. The notice in fact given provided a period of less than 14 days expiring on a Sunday. The Commissioner argued that, although the period of notice given was only 13 days, the notice was not invalid because s 36(2) extended the time for compliance to the next following Monday, and thereby extended the period of notice to 14 days100. The argument was rejected. Williams, Webb and Fullagar JJ reasoned101 separately, but to similar effect, that, if the notice had been of at least 14 days expiring on a Saturday, Sunday or other holiday, s 36(2) would have operated to extend the time for compliance to the next business day. But, because the notice was of less than 14 days, it did not comply with the mandatory statutory requirement that it be of not less than 14 days, and thus it was invalid. And, being invalid, it was not something to which s 36(2) could apply102. By contrast, ss 45 and 65 of the Migration Act do not specify a minimum period of notice and they do not provide for one person to impose a duty on another. They allow an applicant for visa to make an application that is capable of being granted under s 65 right up to the moment that the applicant's current visa expires. There is also nothing about ss 45 and 65 which implies that an application made after the expiration of an applicant's existing visa is invalid. An application which satisfies the requirements of Sched 1 to the Regulations (which the application in this case did) is a valid application, notwithstanding that it may not satisfy the requirements of Sched 2. It is just that, although validly made, an application cannot be granted under s 65 unless the requirements of Sched 2 are met. The re-enactment rule Finally, it should be mentioned that underlying the Minister's written submissions was the suggestion that this Court should not depart from the construction of s 36(2) of the Acts Interpretation Act adopted by the majority in Zangzinchai because s 36(2) was re-enacted in 2011 in substantially the same form after the provision had been so construed. That submission is not persuasive either. Granted, where legislation is re-enacted after being judicially interpreted, there is something of a presumption 100 Balmford (1950) 81 CLR 161 at 175-176 per Latham CJ. 101 Balmford (1950) 81 CLR 161 at 181 per Williams J, 181-182 per Webb J, 186-187 102 Balmford (1950) 81 CLR 161 at 181 per Williams J, 181-182 per Webb J, 186-187 Nettle that the legislature has thereby approved the interpretation103. But, as was observed in Salvation Army (Victoria) Property Trust v Fern Tree Gully Corporation104, the presumption should not lead the court to perpetuate a construction of a statutory provision which it considers to be erroneous. Over time and with changes in the "mechanics of law-making", the importance of the presumption has declined105. Accordingly, as was stated in Flaherty v Girgis106, the rule is nowadays of much less use as a guide and will not be permitted to prevail over an interpretation otherwise appearing to be correct107. It is to be observed, too, that the rule has typically been confined in its application to the re-enactment of a provision in identical terms108. It is, therefore, particularly inapposite in a case like this where the legislature has deliberately employed different wording from the earlier form of the provision. Possibly, the change in format made by dividing the provision into paragraphs was essentially only stylistic, seeking to make the form of the provision align more closely with modern drafting techniques without necessarily changing its substantive effect. But the change from "prescribe" to "require" cannot be dismissed on that basis. In the absence of other explanation, it presents as bringing the operation of the provision more closely into line with Burchett J's reasoning in Zangzinchai. 103 Ex parte Campbell; In re Cathcart (1870) LR 5 Ch App 703 at 706 per Lord James; Pillar v Arthur (1912) 15 CLR 18 at 22 per Griffith CJ; [1912] HCA 51; Barras v Aberdeen Steam Trawling and Fishing Co Ltd [1933] AC 402 at 412 per Viscount Buckmaster, 442 per Lord Russell of Killowen; Platz v Osborne (1943) 68 CLR 133 at 141 per Rich J; [1943] HCA 39. 104 (1952) 85 CLR 159 at 174 per Dixon, Williams and Webb JJ; [1952] HCA 4. 105 R v Reynhoudt (1962) 107 CLR 381 at 388 per Dixon CJ; [1962] HCA 23. 106 (1987) 162 CLR 574 at 594 per Mason ACJ, Wilson and Dawson JJ; [1987] HCA 107 See also Zickar v MGH Plastic Industries Pty Ltd (1996) 187 CLR 310 at 329 per Toohey, McHugh and Gummow JJ; [1996] HCA 31; Foots v Southern Cross Mine Management Pty Ltd (2007) 234 CLR 52 at 75 [63] per Gleeson CJ, Gummow, Hayne and Crennan JJ; [2007] HCA 56. 108 Ex parte Campbell (1870) LR 5 Ch App 703 at 706 per James LJ; Pillar v Arthur (1912) 15 CLR 18 at 22 per Griffith CJ (where weight is placed on "identical language"); Thompson v Smith (1976) 135 CLR 102 at 109 per Gibbs J (Mason J and Aickin J agreeing at 109); [1976] HCA 56; Quality Bakers v Australian Liquor, Hospitality and Miscellaneous Workers Union, NSW Branch (2004) 139 IR 416 at 430 [40]. Cf Te v Minister for Immigration and Ethnic Affairs (1999) 88 FCR 264 at 272 [29]-[30]. Nettle In the result, for the reasons already stated, the construction of s 36(2) adopted by the majority in Zangzinchai does not appear to be correct. It unnecessarily limits the operation of the sub-section in a way that is not supported by the text, purpose or context of the provision, and which is inconsistent with the balance of authority as to the proper construction of comparable provisions. Such presumption as there may be because of the re-enactment of s 36(2) after the decision in Zangzinchai is not a sufficient reason to prefer the majority's reasoning in that case to the construction of s 36(2) which otherwise appears to be correct. Conclusion It follows that I would dismiss the appeal, but it is unnecessary to make an order as to costs in light of the Minister's undertaking to pay the first, second and third respondents' costs in this Court.

HIGH COURT OF AUSTRALIA WACB AND APPELLANT MINISTER FOR IMMIGRATION AND MULTICULTURAL AND INDIGENOUS AFFAIRS RESPONDENT WACB v Minister for Immigration and Multicultural and Indigenous Affairs [2004] HCA 50 7 October 2004 1. Appeal allowed with costs. ORDER 2. Set aside the orders of the Full Court of the Federal Court of Australia made on 21 August 2002 and, in place thereof, order that: a) the appeal to the Full Court be allowed with costs, and b) order 2 of the orders of French J made on 26 October 2001 be set aside. On appeal from the Federal Court of Australia Representation: J L Cameron for the appellant (instructed by Freehills) D M J Bennett QC, Solicitor-General of the Commonwealth with P R Macliver for the respondent (instructed by Australian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS WACB v Minister for Immigration and Multicultural and Indigenous Affairs Immigration – Refugees – Non-citizen – Illiterate and unaccompanied minor in immigration detention – Application for review by the Federal Court of decision of Refugee Review Tribunal – Whether under s 478(1)(b) of the Migration Act 1958 (Cth) the application for review was lodged within 28 days of the applicant being notified of the decision – Whether applicant "notified of the decision" under s 478(1)(b) by being told of outcome of decision – Whether giving to the applicant the written statement under s 430 is required for notification under s 478(1)(b). Statutes – Construction – Whether under s 478(1)(b) of the Migration Act 1958 (Cth) the application for review was lodged within 28 days of the applicant being notified of the decision – Whether the Minister's obligations as statutory guardian under s 6 of the Immigration (Guardianship of Children) Act 1946 (Cth) are relevant to the construction of s 478(1)(b). Words and phrases – "Notified of the decision", "decision", "give". Migration Act 1958 (Cth), ss 430, 430A, 430B, 430C, 430D, 478. Immigration (Guardianship of Children) Act 1946 (Cth), ss 5, 6, 6A. GLEESON CJ, McHUGH, GUMMOW AND HEYDON JJ. This appeal from the Full Court of the Federal Court (Whitlam, North and Stone JJ)1 arises out of an objection to competency taken by the respondent ("the Minister") before the Federal Court. French J upheld that objection and dismissed the application2. The Full Court agreed. The objection3 was that the appellant's application for judicial review of a decision by the Refugee Review Tribunal ("the RRT") had been lodged out of time. At first instance, in the Full Court, and in this Court, the appellant's case has been presented by counsel appearing pro bono. As will become readily apparent, without that assistance the appellant would have lacked any means effectively to utilise his access to the exercise of the judicial power of the Commonwealth. The legal issues are of a highly technical nature. Of central importance is the construction of s 478 of the Migration Act 1958 (Cth) ("the Act") as it stood before the commencement of the Migration Legislation Amendment (Judicial Review) Act 2001 (Cth) (the privative clause amendment), but after the commencement of the Migration Legislation Amendment Act (No 1) 1998 (Cth) ("the 1998 Act"). The importance of the changes introduced by the 1998 Act will become apparent later in these reasons. At the relevant time, Pt 8 of the Act, headed "Review of decisions by Federal Court", included s 478 which stated: "(1) An application under section 476 or 477 must: be made in such manner as is specified in the Rules of Court made under the Federal Court of Australia Act 1976; and be lodged with the Registry of the Federal Court within 28 days of the applicant being notified of the decision. The Federal Court must not make an order allowing, or which has the effect of allowing, an applicant to lodge an application outside the period specified in paragraph (1)(b)." Sections 476 and 477 provided the grounds under which an application for judicial review might have been made to the Federal Court. 1 WACB v Minister for Immigration and Multicultural Affairs (2002) 122 FCR 469. (2001) 113 FCR 524. 3 Taken pursuant to O 54B r 3 of the Federal Court Rules ("the Rules") made under the Federal Court of Australia Act 1976 (Cth). McHugh The task on this appeal is to construe the phrase "notified of the decision" in s 478(1)(b), in light of the subject, scope and purpose of the relevant provisions of the Act. The facts The appellant is a male who alleges that he was born in Afghanistan in 1985. He arrived in Australia by boat on 17 December 2000 and is an unlawful non-citizen within the meaning of the Act. At the time of his arrival, and at all relevant times, the appellant was an unaccompanied minor who allegedly could neither read nor write in either English or his native language, and had received no education in Afghanistan other than lessons in the Koran at his local mosque. On 1 January 2001, he applied for a protection visa. The application was prepared by a migration agent. On 25 January 2001, a delegate of the Minister refused the appellant's application. The appellant applied for review of the delegate's decision by the RRT. On 15 March 2001, the RRT affirmed the delegate's decision. The substantive reasons given by the RRT for affirming the delegate's decision are not relevant to the issues in this appeal. At all material times for the purposes of this appeal, the appellant was in immigration detention at the Curtin immigration reception and processing centre ("the Curtin centre") near Derby in Western Australia. On 16 March 2001, a facsimile transmission was sent to the Curtin centre from the Melbourne Registry of the RRT. The facsimile comprised 18 pages. The coversheet was addressed to the Manager of the Curtin centre and requested that the Manager "immediately pass the accompanying correspondence and decision" to the appellant. It was followed by a two page letter from the Deputy Registrar in the Melbourne Registry of the RRT and addressed to the appellant at the Curtin centre, a debit note for a "RRT $1,000 Post Decision Fee", and 14 pages of reasons of the RRT, all in English. The letter informed the appellant that the RRT had decided that he was not entitled to a protection visa. It also told him that he had the right to seek review of the decision by the Federal Court, and that an application for review must be lodged with that Court within 28 days of notification of the decision. The letter included the statement "I strongly advise you to seek legal advice if you wish to seek review by the Court". If the appellant had "any questions about [his] current residency status in Australia", he was told to "contact [his] regional office" of the Minister's Department. McHugh There was an address for service (a firm of migration agents in Melbourne4) provided by the appellant to the RRT that differed from that of the Curtin centre. However, at the relevant time, the provisions of the Act respecting review by the RRT did not provide for delivery of the decision to a representative if the applicant was in immigration detention. What then was communicated to the appellant was the subject of disputed evidence before the primary judge. The primary judge found that the appellant had been told by the Manager, speaking through an interpreter whose name the appellant did not remember, that the RRT had refused his application for a protection visa and that he had 28 days within which to apply for judicial review by the Federal Court5. According to the appellant, the documents were then handed to Ms Alamar, a counsellor employed by the company managing the Curtin centre, who took him into another room and told him, it would appear in the Dari language, that the RRT had refused his application because they did not believe he was an Afghan. The primary judge did not resolve whether, contrary to what the Manager of the Curtin centre said was his recollection, but consistent with the appellant's evidence, the reasons for the RRT's decision had not been handed to the appellant on 16 March 2001. According to the appellant, the documentation was handed to Ms Alamar and remained with her until requested by the appellant "some" weeks later. Ms Alamar did not give evidence and neither the appellant nor the Manager of the Curtin centre, both of whom gave evidence on affidavit, was cross-examined. Accordingly, on this aspect of the matter, the appellant's account was not challenged by the Minister. Nor, in the Full Court, did the Minister by notice of contention or cross-appeal complain of the absence of a finding in the Minister's favour on any factual issue. On the construction of the Act advanced by the Minister, the date upon which the documentation was given to the appellant was irrelevant. However, as will appear, upon the proper construction of the statute the ascertainment of that date indeed was critical for a successful objection to the competency of the Federal Court proceeding and the Minister had the burden of establishing lack of competency. 4 See Pt 3, Div 3 of the Act. (2001) 113 FCR 524 at 538. McHugh Notification provisions The appellant submitted that s 478 should be read by reference to, or as picking up, the provisions in Pt 7, Div 5 of the Act, headed "Decisions of Refugee Review Tribunal". Part of this Division (ss 430A-430D) was described as a "code" for the delivery, or notification, of decisions by the RRT to the applicant and the Secretary of the Minister's Department ("the Secretary"). The term "code" is usually employed to describe a statute replacing the common law on a particular subject, such as bills of exchange and sale of goods6, but may conveniently be used here. An integral element of the code is the stipulation that a written statement containing inter alia the reasons for the RRT's decision to be "given" to the applicant, putting it shortly, either at the time the decision is handed down, or within 14 days of the date on which the decision is handed down. The appellant submitted first that, by reading s 478 together with the code, time does not begin to run until the written statement is given to the applicant. In oral argument, the appellant went further and submitted that the written statement must be translated and communicated to him orally (given he was illiterate) in order to qualify as notification of the decision under s 478. As will appear, the first of these submissions should succeed. Further reference to the second submission is made in the penultimate paragraph of these reasons, under the heading "Other matters". Sub-section (1) of s 430, which is headed "Refugee Review Tribunal to record its decisions etc", provides: "Where the [RRT] makes its decision on a review, the [RRT] must prepare a written statement that: sets out the decision of the [RRT] on the review; and sets out the reasons for the decision; and sets out the findings on any material questions of fact; and refers to the evidence or any other material on which the findings of fact were based." 6 Gamer's Motor Centre (Newcastle) Pty Ltd v Natwest Wholesale Australia Pty Ltd (1987) 163 CLR 236 at 243-244. McHugh Sub-section (3), which is not presently relevant, provides that the RRT must return to the Secretary certain documents after preparing the written statement in sub-s (1). Sub-section (2) was repealed by the 1998 Act and replaced with ss 430A-430D ("the code"). It had provided: "The [RRT] must give the applicant and the Secretary a copy of the statement prepared under subsection (1) within 14 days after the decision concerned is made." Section 430A, headed "Tribunal must invite parties to handing down of decision", is self-explanatory. It indicates that one rationale of the code may be to ensure that applicants are informed of RRT decisions so as to minimise the scope for complaints of lack of procedural fairness7. Sections 430B-430D provide five methods by which the applicant may be notified of the decision, each depending on the individual circumstances of the applicant. The decision may be notified orally. It may be notified in writing (a) to an applicant in immigration detention; (b) to an applicant present at the handing down of the decision (ie, not in immigration detention); (c) to an applicant's representative present at the handing down; or (d) to an applicant's representative who is not present at the handing down of the decision. These methods of notification will be considered later in these reasons. This code is also mirrored in Pt 5, Div 6 of the Act, which contains the equivalent provisions in relation to proceedings before the Migration Review Tribunal ("the MRT"). The written statement provision in s 430(1) in respect of the RRT is mirrored in s 368(1) in respect of the MRT. (The present case did not involve any decision reviewable by the MRT rather than the RRT.) When regard is had to the legislative history of the notification provisions, their subsequent amendment, the operation and function of the code, and the purpose of s 478, it will be apparent that what is required to constitute notification of the decision under s 478(1)(b) is a fulfilment of the code. This requires, in a case such as the present where a written rather than oral decision was given by the RRT, the giving of the written statement provided for in s 430(1). We turn first to the legislative history. 7 Both the Explanatory Memorandum and Second Reading Speech of the Minister on the Bill for the 1998 Act are silent as to the rationale of the code. McHugh Legislative history of the notification provisions: the 1989 amendments The notification provisions, including the code in Pt 7, Div 5 of the Act, have a provenance. The progenitor of s 478(1)(b) is s 138(3) of the Act. This was inserted by s 26 of the Migration Legislation Amendment Act 1989 (Cth) and remained in the Act until 19928. Sub-section (1) of s 138, which was headed "Appeal to Federal Court on question of law", provided that an appeal lay to the Federal Court on a question of law from any decision of the Immigration Review Tribunal ("the IRT"). Section 138(3) provided: "An appeal shall be instituted within 28 days after the appellant is notified under section 135 of the decision concerned." As it then stood, the Act did not contain a provision equivalent to s 478(2), requiring the Federal Court not to make an order allowing an applicant to lodge an application outside the time limit. Section 135 of the Act9, headed "Tribunal to record its decisions etc and to notify parties"10, relevantly provided: "(1) Where the Tribunal makes its decision on a review, the Tribunal shall prepare a written statement that: sets out the decision of the Tribunal on the review; sets out the reasons for the decision; sets out the findings on any material questions of fact; and refers to the evidence or any other material on which the findings of fact were based. 8 Originally inserted as s 64V(3), and later renumbered s 138(3) by s 83 of the Migration Legislation Amendment Act 1994 (Cth) ("the 1994 Act"). 9 Originally inserted as s 64S, and later renumbered s 135 by s 83 of the 1994 Act. 10 The emphasised part of the heading was repealed by the 1998 Act; notification is now dealt with by the code inserted by that Act, rather than s 430(2). McHugh The Tribunal shall give the applicant and the Secretary a copy of the statement prepared under subsection (1) within 14 days after the decision concerned is made." Reading s 138(3) together with s 135, it is apparent that time began to run only when notification under s 135 was complete, ie, once the written statement was given to the applicant within 14 days of the decision being made. Section 135(1) of the Act is now mirrored in s 430(1) (for the RRT) and s 368(1) (for the MRT). At the time that ss 135 and 138 were in force, the Act contained a two-tier system of review. Following an adverse decision by the Minister or his or her delegate, the applicant was able to seek internal review through the Migration Internal Review Office ("the MIRO")11. A further adverse decision entitled the applicant to seek external review through the IRT12. The applicant's entitlement to "appeal" to the Federal Court on a question of law arose upon an adverse decision by the IRT. The 1992 amendments The Migration Reform Act 1992 (Cth) expanded the system of review by splitting external review over two bodies. The RRT was created to review protection visa decisions, whilst the IRT retained the residual jurisdiction. The MIRO was also retained. These changes necessarily caused the legislative structure of the Act to change. The Federal Court review jurisdiction was no longer limited to decisions made by the IRT. It was expanded to cover decisions by the RRT13. Accordingly, s 138 was repealed and s 478 was inserted14, together with a new Pt 8 dealing with which decisions were reviewable by the Federal Court. A new Pt 4A, later renumbered Pt 715, was inserted establishing the RRT. Section 166E headed "Refugee Review Tribunal to record its decisions etc and to notify parties", mirrored s 135, and relevantly provided: 11 See s 115 of the Act as it then stood and the Migration (Review) Regulations (Cth) (repealed). 12 See s 116 of the Act as it then stood and the Migration (Review) Regulations (repealed). 13 See s 166LA of the Act, and later renumbered s 475 by s 83 of the 1994 Act. 14 Inserted as s 166LD, and later renumbered by s 83 of the 1994 Act. 15 See s 83 of the 1994 Act. McHugh "(1) Where the [RRT] makes its decision on a review, the [RRT] must prepare a written statement that: sets out the decision of the [RRT] on the review; and sets out the reasons for the decision; and sets out the findings on any material questions of fact; and refers to the evidence or any other material on which the findings of fact were based. The [RRT] must give the applicant and the Secretary a copy of the statement prepared under subsection (1) within 14 days after the decision concerned is made." This was later renumbered s 43016. Thus, as it stood following the 1992 amendments, the only substantive changes (the relocation of the review entitlement to a new Part of the Act, and the establishment of the RRT) did not appear to effect a change in what constituted notification of the decision. Section 478(1)(b) now required that an application be lodged with the Registry of the Federal Court within 28 days of the applicant being "notified of the decision", rather than within 28 days of the applicant being "notified under section 135 of the decision concerned". The change was necessary to reflect the expansion in the review regime, but the provisions concerned with notification (the former s 135(2)) were not altered. Both provisions now required that the written statement be given to the applicant within 14 days after the decision concerned was made (s 430(2) (the RRT) and s 368(2) (the MRT)). Accordingly, the relevant act of notification of the decision was still the giving of the written statement. It may be observed that the ss 135 and 138 scheme for judicial review created by the 1989 amendments is reflected in ss 500(6B) and 501G(1) of the Act as it currently stands. These provisions deal with appeals to the Administrative Appeals Tribunal ("the AAT") from character related decisions. Section 500(6B) provides: "If a decision under section 501 of this Act relates to a person in the migration zone, an application to the [AAT] for a review of the decision 16 See s 83 of the 1994 Act. McHugh must be lodged with the [AAT] within 9 days after the day on which the person was notified of the decision in accordance with subsection 501G(1)". (emphasis added) Section 501 of the Act empowers the Minister (s 501(3)) or his or her delegate (ss 501(1) and 501(2)) to refuse to grant or cancel a person's visa if satisfied that the person does not "pass the character test" (or some variation on this criterion)17. Section 501G(1), headed "Refusal or cancellation of visa – notification of decision" relevantly provides: "If a decision is made under subsection 501(1) or (2) or 501A(2) or section 501B or 501F to: refuse to grant a visa to a person; or cancel a visa that has been granted to a person; the Minister must give the person a written notice that: sets out the decision; and specifies the provision under which the decision was made and sets out the effect of that provision; and sets out the reasons (other than non-disclosable information) for the decision". (emphasis added) The 1998 amendments In 1998, ss 430 and 368 were further amended by the repeal of sub-s (2), the 14 day period for delivery of the written statement, and the insertion into Pts 7 and 5 of more detailed provisions that have been described as the code. As indicated above, there are five methods by which a tribunal decision individual the applicant, each depending on the may be delivered circumstances of the applicant. First, a decision may be delivered orally18. The relevant provisions provide that the tribunal must give the applicant and the Secretary a copy of the 17 See s 501(6) of the Act. 18 Sections 430D(1) and 368D(1). McHugh written statement (under s 430(1) (the RRT) or s 368(1) (the MRT)) within 14 days after the decision is made; the applicant "is taken to be notified of the decision" on the day on which the decision is made. Secondly, where an applicant is in immigration detention (as was the appellant here) the tribunal must give the applicant and the Secretary a copy of the written statement within 14 days after the decision is made19. Unlike an oral decision, an applicant in immigration detention is not taken to be notified of the decision on the day on which the decision is made. If the decision is not an oral decision and if the applicant is not in immigration detention, then the date of the decision is taken to be the date on which the decision is handed down20. A tribunal's decision, in these circumstances, may be handed down by reading the outcome of the decision, despite whether or not either or both the applicant and the Secretary are present21. These provisions apply to the third, fourth and fifth methods of delivery, to which we turn. Thirdly, where an applicant is present at the handing down, the tribunal must give the applicant a copy of the written statement22. The same applies to the Secretary23. Fourthly, if the applicant is not present at the handing down of the decision, the tribunal must "notify the applicant of the decision by giving the applicant a copy" of the written statement within 14 days after the day on which the decision is handed down24. The same applies to the Secretary25. 19 Sections 430D(2) and 368D(2). 20 Sections 430B(4) and 368B(4). 21 Sections 430B(3) and 368B(3). 22 Sections 430B(5) and 368B(5). 23 Sections 430B(5) and 368B(5). 24 Sections 430B(6) and 368B(6). 25 Sections 430B(7) and 368B(7). McHugh The fifth method of delivery is to a representative of the applicant. The relevant provisions (ss 430C and 368C) are headed "Applicant taken to be notified when representative notified". Section 430C provides: If a representative of the applicant is present at the handing down of a decision under section 430B, the applicant is taken to be notified of the decision on the day on which the decision is handed down. If a representative of the applicant is notified of a decision under subsection 430B(6), the applicant is taken to be notified of the decision on the day on which the representative is so notified." This brief description reveals that an element common to four of the five methods is the giving of the written statement. Other than the first method (oral decision), which deems the applicant to be notified upon handing down (and for which ordinarily there would then be no written reasons), the code is fulfilled only when the written statement is given to the applicant or to the applicant's representative. Thus, in the present case (the second method above), notification of the decision under the Act and thus under s 478(1)(b) did not occur until the written statement was given to the appellant. Accordingly, an examination of the legislative history of the notification provisions, and the various methods of notification inserted by the 1998 amendments, reinforces the importance of the written statement as the medium of notification. Conclusions as to construction As remarked earlier in these reasons, Pt 8, which includes s 478, is headed "Review of decisions by Federal Court". These provisions confer upon certain unsuccessful visa applicants (and in some circumstances the Minister26) an entitlement, limited in scope, to seek judicial review in the Federal Court. Section 478 is facilitative of that entitlement, not destructive of it. While an applicant must lodge the application within 28 days from the date of notification and the Court may not extend that period, nevertheless the Act confers an entitlement to review, albeit one with a limited threshold. This state of affairs may be contrasted with the power given to the Federal Court by s 11(1)(c) of the Administrative Decisions (Judicial Review) Act 1977 (Cth) to extend the time limit which otherwise applies to the institution of applications for judicial review. 26 See s 479 of the Act. McHugh The restriction in s 478 is of a different character to that of typical statutes of limitation which operate to impose a limit of time upon an existing right of action. They operate to bar the prosecution of actions otherwise not subject to such a time limit. In that sense, statutes of limitation are preventative. However, s 478 does not "bar an existing cause of action"; rather, "[i]t imposes a condition which is of the essence of a new right"27. Thus, s 478(1)(b) and s 478(2) restrict what otherwise would be the conferral upon the Federal Court of jurisdiction by the Parliament under ss 76(ii) and 77(i) of the Constitution. The new jurisdiction so conferred is remedial in nature, although the remedy is confined by the time restriction upon the institution of the proceeding. The provision of information to the unsuccessful visa applicant by the RRT is a necessary step to equip the applicant with the wherewithal to institute such a proceeding in the Federal Court. Paragraph (a) of s 478(1) stipulates that an application to the Federal Court be made in the manner specified by the Rules. At the relevant time, those Rules28 required that an application be in accordance with Form 56. This required the applicant to describe how he or she was aggrieved by the decision, the grounds for the application, and the orders sought. That information may be acquired for use in this way by an examination of the reasons of the RRT indicated in the written statement. In oral argument, the Minister referred to various matters said to be of a practical nature, and bearing upon the lodgment of applications in the Federal Court. It was said that an applicant armed with the written statement would be in no better position than if he or she had merely been told of the outcome in the RRT. This was said to be because most applicants (like the appellant in this case) do not have the appropriate skills to frame an application which complies with the Rules. No doubt it was with that in mind that the RRT in its letter to the appellant urged him to seek legal advice if he wished to seek review by the Federal Court. However that may be, the inquiry before the Court is one of statutory construction and it does not assist to consider whether this particular appellant could, unaided, have understood the reasons even if they had been provided to him on 16 March 2001. 27 Australian Iron & Steel Ltd v Hoogland (1962) 108 CLR 471 at 488; Rudolphy v Lightfoot (1999) 197 CLR 500 at 507-508 [10]-[11]. 28 O 54B r 2(1). McHugh The Minister also submitted that the Act draws a distinction between "the decision" and the "reasons for the decision" such that, where s 478(1)(b) refers to an applicant being notified of "the decision", it does not require the written statement (which includes the reasons for the decision) to be given. The distinction was the basis upon which, in its joint judgment, the Full Court dismissed the appeal29. The Minister argued that the distinction is most notably seen in s 430(1) (and also s 368(1)). The written statement provided for includes, inter alia, (a) the decision of the tribunal and (b) the reasons for the decision. If this submission were correct it would leave open the issue of that which constitutes notification in s 478(1)(b), presumably to be filled by reference to its ordinary meaning, and it would ignore the structure and historical development of the Act. However, the construction of s 478(1)(b) is apparent from the text and structure of the Act itself. Hence, such a submission, which at first blush may appear to have merit due to the equivalent language in s 478(1)(b) and s 430(1)(a), should be rejected. Notification of the decision under s 478(1)(b) requires that the code in Pt 7, Div 5 (the RRT) or in Pt 5, Div 6 (the MRT) be observed. In all cases, other than where the tribunal decision is given orally, notification of the decision for the purposes of s 478 occurs when the written statement is given to the applicant for review by the Federal Court. At the relevant time, the word "give" used in s 430D(2), the applicable provision in this case, was not defined. Accordingly, it is the ordinary meaning of the word, understood in its context, that must be considered. The context is that the RRT must give the applicant a copy of the written statement. In that setting, to give a document ordinarily requires its physical delivery, not some act of constructive delivery of possession which, at general law, may suffice to transfer property in a chattel30. It will not be enough to communicate to the applicant orally that the document has arrived, or to communicate the gist of the document, or even to read the document to the applicant. What is required is that the written statement be physically given to the applicant. Only once this has occurred can it be said that s 478(1)(b) is enlivened and time begins to run. The appellant's evidence that the written statement was not "given" until requested by him from Ms Alamar "some" weeks after he was told of the adverse decision by the RRT has not been controverted by the Minister who had the burden of establishing the objection to competency. 29 (2002) 122 FCR 469 at 473-474. 30 See Gamer's Motor Centre (Newcastle) Pty Ltd v Natwest Wholesale Australia Pty Ltd (1987) 163 CLR 236 at 255. McHugh Misdescription and subsequent amendments to the code Although the word "give" in s 430D(2) was not defined, it was defined for the purposes of s 430B(6) (and s 368B(6)). Section 430B(6) dealt with the third method of notification described earlier in these reasons. It provided that, if the applicant was not present at the handing down of the decision, then a copy of the written statement was to be given to the applicant within 14 days by one of the methods specified in s 441A. Section 441A was provided for by Sched 3, Item 12 of the 1998 Act. However, Item 12 may have been ineffective because the amendment was misdescribed. The amendment sought to insert s 441A "[a]t the end of Division 7 of Part 6". No such Division existed. Presumably the Parliament intended to insert s 441A at the end of Div 7 of Pt 7, which is concerned with the RRT. In Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation31, Gibbs CJ said that the canons of construction should not be treated so rigidly as to prevent the implementation of a realistic solution in the case of a drafting mistake32. However, his Honour went on to say that, where the language of a statutory provision is clear and unambiguous, and is consistent and harmonious with the other provisions of the enactment, it must be given its ordinary and grammatical meaning33. In this case it is unclear how this would be resolved. In any case, the applicable provision for this appeal is s 430D(2) (which deals with the second method), not s 430B(6). 31 (1981) 147 CLR 297. 32 (1981) 147 CLR 297 at 304. See also Maxwell on the Interpretation of Statutes, 12th ed (1969) at 228; Craies on Statute Law, 7th ed (1971) at 520-521. In R v Wilcock (1845) 7 QB 317 [115 ER 509] the Payment of Workmen's Wages Act 1818 (UK) (58 Geo III c 51) repealed several Acts described by their titles and dates, including an Act said to have been passed in 13 Geo III. However, the title of the Act described did not agree with any title enacted in that period, but did agree with a title enacted in 17 Geo III. Recognising that a drafting error had been made, Lord Denman CJ said ((1845) 7 QB 317 at 338 [115 ER 509 at 518]): "A mistake has been committed by the Legislature; but, having regard to the subject matter, and looking to the mere contents of the Act itself, we cannot doubt that the intention was to repeal the 17 G 3, and that the incorrect year must be rejected." 33 (1981) 147 CLR 297 at 305. McHugh Since the misdescription in the 1998 Act, the Parliament has, by the enactment of the Migration Legislation Amendment (Electronic Transactions and Methods of Notification) Act 2001 (Cth), provided for deeming provisions for all forms of communications from both the MRT and the RRT to applicants, including the delivery of written statements. By reason of the time of their commencement, these provisions do not apply in this case. They provide that documents delivered by a variety of methods (including facsimile and email) are taken to be received by an applicant at a certain time. For example, an applicant in immigration detention is deemed by s 441C(5) of the Act to have been given the written statement provided under s 430(1) at the end of the day on which it is faxed to the immigration detention centre. Other matters The appellant submitted that it was relevant to the determination of what constituted notification of the decision in s 478(1)(b) to consider the obligations of the Minister as the guardian of unaccompanied minors under the Immigration (Guardianship of Children) Act 1946 (Cth) ("the Guardianship Act"). In R v Director-General of Social Welfare (Vict); Ex parte Henry34, this Court held that the Guardianship Act was a valid exercise of the immigration power in s 51(xxvii) of the Constitution. Since then, the Act has been amended such that the criterion of operation is no longer an "immigrant child" but a "non-citizen child". The validity of the Act was not challenged in this appeal. The appellant submitted that for the Minister, as statutory guardian, the interests of the minor were paramount and took precedence over the Minister's statutory obligations under the Act as the opposing litigant in the Federal Court and this Court. This submission is ill-founded. Any role the Minister may have as guardian is not altogether clear given the language of the relevant sections of the Guardianship Act35. However, any such role is irrelevant to the question of construction raised by this appeal. The question is how to construe the phrase 34 (1975) 133 CLR 369. 35 Section 6 provides that the Minister shall be the guardian of every "non-citizen child" who arrives in Australia. The expression "non-citizen child" is defined in s 4AAA as a child who (a) has not turned 18; (b) enters Australia as a non-citizen; and (c) intends, or is intended, to become a permanent resident of Australia. A question may arise as to whether a person who enters Australia unlawfully and who has no entitlement to remain in Australia without permission can meet s 4AAA(b) and (c). McHugh "notified of the decision" in s 478(1)(b) of the Act. Any obligation of the Minister under a different enactment can have no effect on that construction. In any event, although s 6A(1) of the Guardianship Act provides that a non-citizen child shall not leave Australia except with the consent in writing of the Minister, s 6A(4) qualifies this, stating: "This section shall not affect the operation of any other law regulating the departure of persons from Australia." The appellant also submitted that the fact that he had little or no education and was illiterate was also relevant to the construction of s 478(1)(b). He contended that, whilst what was required was delivery of the written statement under s 430(1), it was also necessary that it be translated into a language understandable to the appellant (either orally or in writing). As discussed, s 478 is construed by reference to the provisions of the Act. The Act provides a complete answer. The Act does not distinguish between notification given to a person in the position of the appellant and any other visa applicant. Nor does it distinguish between applicants with differing levels of education or literacy. Order The appeal should be allowed with costs, and the orders of the Full Court set aside. In place thereof, it should be ordered that the appeal to the Full Court be allowed with costs, and order 2 of the orders of French J made on 26 October 2001 be set aside. The result is that the appellant's substantive application for review will proceed for hearing and determination in the ordinary course. Kirby KIRBY J. This appeal comes from a judgment of the Full Court of the Federal Court of Australia36. That court confirmed the orders of the primary judge (French J)37. The result upheld a conclusion that a purported application for judicial review brought by a claimant for protection as a refugee, WACB (the appellant), was incompetent because out of time. In this Court, the appellant challenges the construction placed by the Federal Court upon the Migration Act 1958 (Cth) ("the Migration Act")38. He also argues that the result below may be overcome because the Minister for Immigration and Multicultural and Indigenous Affairs ("the Minister") is his "guardian", pursuant to s 6 of the Immigration (Guardianship of Children) Act 1946 (Cth) ("the Guardianship Act"). In such circumstances, the appellant submits that the Minister failed to comply with relevant duties as his guardian and that this affected the Minister's right to obtain relief under the Migration Act on the ground of the appellant's time default. The facts The appellant's refugee claim: The appellant claims that he was born in Afghanistan in 1985 of Hazara ethnicity. His exact birth date is unknown. However, it was accepted that at all material times he was a minor39. On 17 December 2000, the appellant arrived in Australia by boat without authority. At the time of his arrival, he was an unaccompanied non-citizen child. On 2 February 2001, he applied for a protection visa under the Migration Act40. At the time of the appellant's application, the Taliban regime was in control of that part of Afghanistan from which the appellant said he derived. The appellant claimed that he could neither read nor write; nor could he tell the time. He had spent his life in a mountainous area as a shepherd tending to three sheep. He had no education apart from lessons in the Koran at the local mosque. Although he had visited a nearby "sub-village", he had never been to the larger village closest to his home41. His father, who had supported an opposition group 36 WACB v Minister for Immigration and Multicultural Affairs (2002) 122 FCR 469. 37 (2001) 113 FCR 524. 38 See reasons of Gleeson CJ, McHugh, Gummow and Heydon JJ ("joint reasons") at 39 (2001) 113 FCR 524 at 526 [4]. 40 (2001) 113 FCR 524 at 526 [2]. 41 Refugee Review Tribunal, Decision and Reasons for Decision, ref V01/12237, 15 March 2001 at 6. Kirby opposed to the Taliban, had disappeared about nine months before his application, presumably taken into custody or killed. His mother had arranged for him to escape Afghanistan in order to avoid either the same fate or being sent to fight in the Taliban's war. The appellant escaped through Pakistan. Under the control of a smuggler, he travelled on false documents to Singapore and Indonesia and thence to Australia. If the foregoing facts had been believed, the appellant had an arguable case that he was entitled to a protection visa as a refugee within the definition in the Refugees Convention42, given effect by the Migration Act43. Notification of the Tribunal's ruling: At all material times, the appellant was in immigration detention at the Curtin immigration detention centre ("Curtin") at Derby on the northern coast of Western Australia. On 25 January 2001, a delegate of the Minister refused the appellant's application44. The appellant applied for review of the delegate's decision by the Refugee Review Tribunal ("the Tribunal"). On 15 March 2001, the Tribunal affirmed the delegate's decision. The Tribunal concluded that the appellant had fabricated the claims he had advanced. It reached this view on the basis of discrepancies that it found in the appellant's testimony. Because there was "no other material on which the Tribunal [could] be satisfied that he [had] a well founded fear of persecution for reasons of a Convention ground", the Tribunal dismissed the claim that the appellant was entitled to a protection visa as a refugee45. The Tribunal's decision had been reserved. It was handed down in Melbourne. There then followed the events critical to the first point argued in this appeal. On 16 March 2001, by facsimile, confirmed by an affirmative transmission report that was proved, eighteen pages of documentation were sent to the Manager of Curtin. The reasons of the Tribunal comprise fourteen pages. A coversheet, a two page letter in English addressed to the appellant and a debit note for an "RRT $1,000 Post Decision Fee" make up the balance of the eighteen pages. The letter to the appellant, apparently in standard form, includes the following statement: 42 Convention relating to the Status of Refugees done at Geneva on 28 July 1951, [1954] Australian Treaty Series No 5, and Protocol relating to the Status of Refugees done at New York on 31 January 1967, [1973] Australian Treaty Series 43 Section 36(2). 44 (2001) 113 FCR 524 at 526 [2]. 45 Refugee Review Tribunal, Decision and Reasons for Decision, ref V01/12237, 15 March 2001 at 13. Kirby "The Tribunal has decided that you are not entitled to a Protection Visa. I enclose a copy of the Tribunal's decision and reasons. … The Tribunal's file on your application is now closed. You have the right to seek review of this decision by the Federal Court. An application for review must be filed with the Court within twenty-eight (28) days of notification of the decision. … I strongly advise you to seek legal advice if you wish to seek review by the Court." The letter contains a translation neither of its essential contents nor of the Tribunal's reasons. Nor does it indicate that the appellant could request the person responsible for his detention to afford reasonable facilities to him for obtaining legal advice or taking legal proceedings46. Instead, much of the communication is concerned with a demand that the appellant pay to the federal Collector of Public Moneys the sum of $1,000 stated to be a "debt to the Commonwealth of Australia". If the debt remained unpaid, the notification warns, "you will be unable to obtain a visa in the future". Resolution of conflicts of evidence: A conflict of evidence arose concerning what happened when the foregoing facsimile transmission was received at Curtin. That conflict was explored before the primary judge in the Federal Court. The appellant filed an application for review of the Tribunal's decision in that court on 3 May 2001. On 21 May 2001, the then Minister caused a notice of objection to the competency of that application to be filed. He asked for summary relief, namely dismissal of the application on the footing that the Federal Court lacked jurisdiction to hear it because it had not been lodged within the 28 day period then prescribed by the Migration Act47. It was the Minister's motion that directed attention to the obligations imposed by law, including on the Minister, to ensure that the appellant was notified of the decision of the Tribunal in such a way as to commence the running of time in the Federal Court applicable to such a case. Before the primary judge, the Manager of Curtin, Mr Greg Wallis, gave evidence by affidavit that a meeting had taken place at Curtin on 16 March 2001, attended by the appellant. Based on his "standard practice" and a confirmatory note that he had written on the facsimile cover sheet, Mr Wallis stated that he "personally handed the Tribunal decision in this matter to the applicant on 16 March 2001". The handwritten note, bearing that date, was in evidence and is 46 Migration Act, s 256. 47 Section 478(1)(b). This provision of the Act was repealed and replaced by the Migration Legislation Amendment (Judicial Review) Act 2001 (Cth), s 3, Sched 1, Pt 1, cl 7; Pt 2, cl 8 (1). It was common ground that s 478 continued to apply to the appellant's entitlements. Kirby in confirmatory terms. It includes the hand-written note stating "Advised of 28 day appeal period for Federal Court". The appellant also swore an affidavit deposing to the circumstances of the meeting on 16 March 2001. He stated that Mr Wallis was present with an Afghan interpreter and a "Ms El Ham". This is a reference to Ms Elham Alamar, a counsellor with qualifications in psychology employed by the company managing Curtin. According to the appellant, Mr Wallis told him that he had been rejected by the Tribunal. He was upset and began crying. Mr Wallis did not give the appellant any papers. Rather, he gave them to Ms Alamar "and said that she would explain what had happened". The appellant stated that Ms Alamar took him to another room "and told me that I had not been able to prove that I was Afghan, and that the witnesses had said that they did not know me". The last statement is an apparent reference to a conclusion of the Tribunal that certain Afghan witnesses, tendered at the hearing, did not prove that they knew the appellant and his family. According to the appellant, Mr Wallis did not tell him anything about applying for review to the Federal Court. He only learned about this at Curtin "about three weeks later". He denied that Mr Wallace had told him that he had 28 days to apply to the Federal Court. He stated that Ms Alamar did not give him the Tribunal decision on the day of the meeting but only when he asked for it weeks later. He said that she did not interpret the decision for him and that "the decision has never been translated for me by anyone" from the Minister's Department. Neither Mr Wallis nor the appellant was cross-examined on his affidavit. The primary judge generally preferred the evidence of Mr Wallis48. For the appellant, it was accepted, properly, that this conclusion was open to the judge. The matter must therefore be approached on the footing that, for whatever legal consequences follow, the appellant was advised of the outcome of his application to the Tribunal and of the 28 day time limit. The primary judge concluded, as a possibility, that "the [appellant] was so distressed at hearing that he was not to receive a visa, that he did not register the other things he was told"49. The primary judge did not resolve the other contested issue of fact, namely whether the documents themselves, including the Tribunal decision and reasons, were given to the appellant or to Ms Alamar. Having regard to the appellant's age, apparent illiteracy and background, it seems reasonable to accept that the documents were handed to Ms Alamar and remained 48 (2001) 113 FCR 524 at 536 [34]. 49 (2001) 113 FCR 524 at 536 [34]. Kirby with her until requested by the appellant some weeks later. The fact that the Minister was seeking summary relief and that counsel did not cross-examine the appellant on his version of events makes such a conclusion one that is appropriate for this Court to accept. However, the Minister argued that, having regard to the provisions of the Migration Act, these considerations were irrelevant. It is therefore necessary to examine the requirements of that Act. The applicable legislation Provisions of the Migration Act: The critical provisions of the Migration Act, upon which the Minister relied, are to be found in s 478, as it stood at the material time. Although the Minister relied only on s 478(1)(b), it is useful to examine that paragraph in the context of the entire section: "(1) An application under section 476 or 477 must: be made in such manner as is specified in the Rules of Court made under the Federal Court of Australia Act 1976; and be lodged with a Registry of the Federal Court within 28 days of the applicant being notified of the decision. The Federal Court must not make an order allowing, or which has the effect of allowing, an applicant to lodge an application outside the period specified in paragraph (1)(b)." The appellant's application for judicial review was one that sought to engage ss 476 or 477 of the Migration Act. Those sections provide the grounds under which applications might be made for judicial review by the Federal Court. Accordingly, the precondition for the application of s 478 was satisfied. No provision was made in the section, or elsewhere in the Migration Act, for an extension of the time specified in s 478(1)(b). In this respect, s 478 is different – and by inference deliberately different – from other provisions for judicial review of administrative decisions in the Federal Court50. Section 478(2) makes it abundantly clear that no such extension could be permitted whether under other general powers belonging to the Federal Court or otherwise. The difficulty of, and potential injustices flowing from, this situation have been noted in the past by the Federal Court51 and by this Court52. However, at the material time, the 50 See Administrative Decisions (Judicial Review) Act 1977 (Cth), s 11(1)(c). 51 Barzideh v Minister for Immigration and Ethnic Affairs (1997) 72 FCR 337 at 341. 52 Re Minister for Immigration and Multicultural Affairs; Ex parte Miah (2001) 206 CLR 57 at 88 [107], 126-127 [223]-[224]. Kirby Act imposed an inflexible time constraint upon the exercise of the Federal Court's jurisdiction to provide judicial review on the application of persons such as the appellant53. The validity of such provisions was upheld by this Court in Abebe v The Commonwealth54. Such validity was not contested in this appeal. The constitutional issues that arise for legislative attempts to impose constraints on the judicial review jurisdiction of this Court, afforded by s 75 of the Constitution, were not raised in this case55. In 1998, the Migration Legislation Amendment Act (No 1) 1998 (Cth) introduced a new and more detailed Div 5 into Pt 7 of the Migration Act governing decisions of the Explanatory Memorandum distributed with the Bill that became the 1998 Act, the provisions of the Division were intended to constitute a "code" governing the making, handing down and notification of the decisions of the Tribunal56. By s 430(1) of the Migration Act, the Tribunal was required to prepare a written statement of identified content: the Tribunal. According "(1) Where the Tribunal makes its decision on a review, the Tribunal must prepare a written statement that: sets out the decision of the Tribunal on the review; and sets out the reasons for the decision; and sets out the findings on any material questions of fact; and refers to the evidence or any other material on which the findings of fact were based." 53 cf Miah (2001) 206 CLR 57 at 126-127 [223]-[224]; Re Minister for Immigration and Multicultural Affairs; Ex parte "A" (2001) 185 ALR 489 at 496 [31]-[34]. 54 (1999) 197 CLR 510 at 534 [50], 593 [237], 605 [279]-[281]. 55 Campbell and Groves, "Time Limitations on Applications for Judicial Review", (2004) 32 Federal Law Review 29 at 36-41. 56 Australia, Senate, Migration Legislation Amendment Bill (No 1) 1998 (Cth), Explanatory Memorandum, (1998) at [3]; see Migration Act, s 422B(1), inserted after the relevant time by the Migration Legislation Amendment (Procedural Fairness) Act 2002 (Cth), Sched 1, cl 6. Kirby This provision follows a template common in federal legislation57. The procedures to be followed in delivering the Tribunal's decisions were spelt out by the new sections inserted in 1998. Section 430A of the Migration Act provides that certain persons (by inference, those at liberty) are to be invited to attend the handing down of decisions by the Tribunal. However, the section has no application to the appellant because it expressly excludes "a decision on the application of a person who is in immigration detention."58 Such was the case of the appellant at the time the decision of the Tribunal concerning him was handed down. Similarly, s 430B has no application to a "person who is in immigration detention."59 Nevertheless, that section is notable because, in the procedures for which it provides, it draws a distinction between a "decision" of the Tribunal and "the outcome of the decision". By s 430B(3) it is provided: "(3) The Tribunal's decision may be handed down: by reading the outcome of the decision; and (b) whether or not either or both the applicant and the Secretary are present."60 The section goes on to provide61 that: "(4) The date of the decision is the date on which the decision is handed down." If the applicant and the Secretary of the Minister's Department are present at the handing down, the Tribunal must give each a copy of the statement prepared under s 430(1)62. However, s 430B(6) provides: 57 It was earlier inserted in the Migration Act as s 166E by s 32 of the Migration Reform Act 1992 (Cth) and was later renumbered as s 430 by the Migration Legislation Amendment Act 1994 (Cth), s 83. 58 Migration Act, s 430A(1)(b). 59 Migration Act, s 430B(1)(b). 60 Emphasis added. 61 Migration Act, s 430B(4) (emphasis added). 62 Migration Act, s 430B(5). Kirby If the applicant is not present at the handing down of the decision, the Tribunal must notify the applicant of the decision by giving the applicant a copy of the statement prepared under subsection 430(1). The copy must be given to the applicant: (a) within 14 days after the day on which the decision is handed down; and by one of the methods specified in section 441A." Although s 430B also has no application to the appellant's case, the appellant argued that it afforded a contextual guide to the way in which s 430D (which did apply to his case) was intended to operate. By s 430C of the Migration Act, provision is made for deemed notification to the applicant where a representative of the applicant is present at the handing down of the decision under s 430B. As s 430B had no application to the appellant's case, neither does s 430C. The appellant did have a "representative" before the primary judge, apparently acting pro bono. It does appear that some, at least, of the information sent by facsimile transmission to Curtin was also transmitted on 16 March 2001 by that means to the appellant's representative. However, such notification did not engage s 430C. There was no suggestion that the representative was present when the Tribunal's decision was handed down. The final provision in the series, inserted into the Migration Act in 1998, is s 430D. That is the section governing the case of a person, like the appellant, "in immigration detention". It appears under the heading "Tribunal must notify parties (parties not invited to handing down of decision)". Section 430D states: If the Tribunal gives an oral decision on an application for review, the Tribunal must give the applicant and the Secretary a copy of the statement prepared under subsection 430(1) within 14 days after the decision concerned is made. The applicant is taken to be notified of the decision on the day on which the decision is made. If the applicant is in immigration detention, the Tribunal must give the applicant and the Secretary a copy of the statement prepared under subsection 430(1) within 14 days after the decision concerned is made." The reference in s 430D(1) to the giving of an "oral decision" does not appear referable to the appellant's case. The added sections in Div 5 of Pt 7 of the Migration Act draw a distinction between the giving of "oral" decisions (that Kirby is, ex tempore) and the giving of decisions apt to be "handed down" (that is, in written form)63. In the appellant's case the decision was in written form. It was therefore "handed down". Accordingly, on the assumption that s 430D(1) applies to a person in immigration detention, it was not engaged in this instance. The provisions of the Migration Act that governed the procedures to be followed by the Tribunal in the giving of its decisions in respect of an applicant in immigration detention (such as the appellant) were contained in s 430D(2). Provisions of the Guardianship Act: In this review of relevant legislation it is appropriate also to notice provisions of the Guardianship Act relevant to the appellant's second argument. The constitutional validity of that Act was not challenged in this appeal. The Guardianship Act provides for the guardianship of "non-citizen children" as defined64. Such children include a person who "has not turned 18" and who "enters Australia as a non-citizen" and "intends, or is intended, to become a permanent resident of Australia."65 By s 6 of the Guardianship Act, it is provided: "The Minister shall be the guardian of the person, and of the estate in Australia, of every non-citizen child who arrives in Australia after the commencement of this Act to the exclusion of the father and mother and every other guardian of the child, and shall have, as guardian, the same rights, powers, duties, obligations and liabilities as a natural guardian of the child would have, until the child reaches the age of 18 years or leaves Australia permanently, or until the provisions of this Act cease to apply to and in relation to the child, whichever first happens." By the Guardianship Act66, provision is made forbidding a "non-citizen child" from leaving Australia "except with the consent in writing of the Minister" and making it an offence for any other person to aid, abet, counsel or procure a non-citizen child to leave Australia contrary to the provisions of s 6A of the Guardianship Act. Provision is also made in that Act67 for the Minister, "in relation to any matters or class of matters, or in relation to any non-citizen child or class of non-citizen children, by writing under his hand, [to] delegate to any officer or authority of the Commonwealth or of any State or Territory all or any of his powers and functions under this Act". 63 See s 430A(1). 64 Section 4AAA. 65 Guardianship Act, s 4AAA. 66 Section 6A. 67 Section 5. Kirby Although it appeared from argument that certain delegations of powers have been made under s 5 of the Guardianship Act to State and Territory welfare authorities (without, it seems, accompanying State laws authorising the exercise of such powers delegated under federal law68), at the times material to the present case the Minister had not delegated his powers under the Guardianship Act to federal officials or anyone else in respect of the appellant or non-citizen children of the same class as the appellant. Specifically, no delegation has been made so as to avoid any conflict of duty said to arise with respect to the appellant (or children in the same class) by reason of the Minister's duties under the Migration Act and the Guardianship Act respectively. The decisional history Decision of the primary judge: In the Federal Court, the primary judge dealt first with the objection to competency of the appellant's application for judicial review69. He questioned whether the Guardianship Act was intended to apply to non-citizen children arriving in Australia, as the appellant had, without authority and not as an immigrant under the auspices of either a government or any non-governmental migration organisation70. However that might be, he concluded that the Guardianship Act did not render ineffective the notification which the appellant had received under the Migration Act. In the primary judge's view, whatever might be the case for a child of tender years incapable of comprehending the nature of the proceedings71, the capacity of the appellant to pursue his entitlements under the Migration Act could not be doubted72. It was not affected by the Guardianship Act, assuming that Act to be applicable to such a case. This took the primary judge to the question whether the appellant had been "notified of the decision" under s 478(1)(b) of the Migration Act on 16 March 2001. If he had been, it was common ground that his application for 68 See R v Hughes (2000) 202 CLR 535 at 549 [18]-[19], 552 [29], 568 [74], 569 69 (2001) 113 FCR 524 at 536 [35]. 70 (2001) 113 FCR 524 at 536-537 [35]-[36] by reference to Australia, House of Representatives, Parliamentary Debates (Hansard), 31 July 1946 at 3369. 71 (2001) 113 FCR 524 at 537 [37]. 72 See Gillick v West Norfolk and Wisbech Area Health Authority [1986] 1 AC 112 at 188 per Lord Scarman; Secretary, Department of Health and Community Services v JWB and SMB (Marion's case) (1992) 175 CLR 218. Kirby judicial review to the Federal Court was out of time. By reference to previous authority of the Federal Court73, the primary judge decided that being "notified" in this context meant the giving of notice or information in circumstances that the receiver "can understand what it is that he or she has been told"74. On the basis of the facts as he found them, the primary judge concluded that the appellant had been notified of the "decision". By inference, he distinguished notification of the "reasons" for decision and the "statement" provided for in s 430(1) of the Migration Act. For the primary judge, it was enough that the appellant had been notified of the "decision" and he found that this had happened on 16 March 2001 as evident from the appellant's affidavit and on the common ground that he had been distressed on hearing of the Tribunal's "decision" (by inference upon learning that the "decision" was adverse to him). The primary judge drew attention, in his concluding remarks, to apparent departures in the practices concerned from the guidelines published by the United Nations High Commissioner for Refugees concerning the way that claims to refugee status by unaccompanied children, such as the appellant, should be handled75. Amongst other things, the procedures in these guidelines call, in effect, for an adult guardian to look after the interests of such a child76: "8.3 Not being legally independent, an asylum-seeking child should be represented by an adult who is familiar with the child's background and who would protect his/her interests. Access should also be given to a qualified legal representative. This principle should apply to all children, including those between sixteen and eighteen, even where application for refugee status is processed under the normal procedures for adults." The appellant's case was dealt with on the footing that the appellant had not reached his sixteenth year when the contested events occurred. 73 Long v Minister for Immigration, Local Government and Ethnic Affairs (1996) 65 FCR 164; Salehi v Minister for Immigration and Multicultural Affairs [2001] FCA 995. See (2001) 113 FCR 524 at 538 [41]. 74 (2001) 113 FCR 524 at 537 [40]. 75 (2001) 113 FCR 524 at 538-539 [43]-[44]. 76 (2001) 113 FCR 524 at 539 [44], quoting Office of the United Nations High Commissioner for Refugees, Guidelines on Policies and Procedures in dealing with Unaccompanied Children Seeking Asylum, (1997) at 12. See also Office of the United Nations High Commissioner for Refugees, Handbook on Procedures and Criteria for Determining Refugee Status, (1992) at 50 [213]-[219]. Kirby Decision of the Full Court: The Full Court of the Federal Court unanimously confirmed the orders of the primary judge77. At the hearing of the appeal to that court, counsel for the appellant informed the Full Court that the only ground on which the appellant wished to rely was that the primary judge had erred in holding that the appellant had been "notified" of the Tribunal's "decision" for the purposes of s 478(1)(b) of the Migration Act. Upon that issue, the Full Court rejected the suggestion that previous authority of the Federal Court was inapplicable by reason of amendments to the Migration Act78. In accordance with that authority, the Full Court rejected the submission that the appellant had not been "notified" of the "decision" of the Tribunal until the statement provided for in s 430 of the Migration Act had been given to the appellant in a language that was comprehensible to him. For the Full Court, it was critical that the Migration Act (as expressed in the provisions applicable to the appellant's case) now drew a distinction between the Tribunal's "decision" and the "statement" setting out its "reasons" and "findings"79. The Full Court went on to reject the appellant's complaint about the effectiveness of the Tribunal's "decision" based on the appellant's status as a "non-citizen child" under the Guardianship Act. That issue was addressed by reference only to its suggested relevance to the "notification issue"80. However, it was rejected having regard to the primary judge's conclusion that the appellant had understood the "decision" when it was "notified" to him. Appeal to the High Court: By special leave, the appellant now appeals to this Court. Special leave was granted upon the two grounds foreshadowed. The first raised a suggested jurisdictional error on the part of the Tribunal, such that no "decision" under the Migration Act had occurred engaging the time limits provided by s 478(1)(b). The second involved the appellant's argument concerning the meaning of being "notified" in the context. However, when the appeal was heard, the appellant sought to enlarge the grounds of appeal to include a third challenge to the decision of the Full Court with respect to the application and relevance of the point raised under the Guardianship Act. The Minister objected to this enlargement, asserting that it would permit questions to be addressed by this Court that had not been the subject of evidence at trial or 77 WACB (2002) 122 FCR 469. 78 WACB (2002) 122 FCR 469 at 472-474 [11]-[15], applying WACA v Minister for Immigration and Multicultural Affairs (2002) 121 FCR 463. 79 WACB (2002) 122 FCR 469 at 473-474 [15]. 80 WACB (2002) 122 FCR 469 at 475 [22]. Kirby determination in the Full Court81. The appellant was allowed to argue the added ground, subject to later consideration of any questions of procedural unfairness. The appellant's arguments on notification Troubling procedures in the case: The primary thrust of the appellant's case, as presented, concerned the notification point. The appellant was out of time for prosecuting his application for judicial review in the Federal Court by about three weeks. Reference was made both to the practical difficulties that he faced and to the unresolved finding of fact said to be important for the proper application of the Act. The problems facing a person in the position of the appellant are obvious. He was a minor, accepted to be under sixteen years of age. He was in detention in a foreign country without parents, family or friends. He was confined in a remote part of Australia. He was unable to secure employment so as to pay for interpreters and legal advice of his choosing. Although he had assistance from an immigration service (presumably without charge) details of that assistance were not proved. Certainly, at Curtin, the appellant would not have had full access to legal advice. By s 256 of the Migration Act, the Parliament has provided that the person responsible for his immigration detention must afford him all reasonable facilities for obtaining legal advice or taking legal proceedings in relation to his detention. However, this provision is enlivened by "the request of the person in immigration detention". Even at the time of notification of the outcome of his application to the Tribunal, there is no indication that the appellant was informed of this provision. No mention is made of it in the correspondence. Instead, that correspondence contains detailed notification of the appellant's debt to the Commonwealth of $1,000 and the consequences of non-payment. How a person in the appellant's predicament could be expected, realistically, to make such a payment is not revealed. To say the least, there are aspects of the procedure affecting the appellant that are very troubling. Whether the appellant was of Afghan origin or not, it appears clear that his command of the English language was minimal. From the record it is clear that his education and experience were severely confined. He was substantially illiterate. Even providing him with a written statement of the Tribunal's decision, reasons and findings in the English language would have meant nothing to him. Providing it in his own language would also have been of no immediate use to him, except as it could be read to him by any literate detainees fluent in that language who happened to be at Curtin. According to the evidence, no adult was appointed by the Minister, or anyone else, to assist the appellant during his 81 See Suttor v Gundowda Pty Ltd (1950) 81 CLR 418 at 438; Louinder v Leis (1982) 149 CLR 509 at 529. Kirby minority or, in effect, to act as his guardian. At the very most, he had access to Ms Alamar. However, she was an employee of the organisation contracted to conduct the detention facility on behalf of the Minister. She was not in a position to act independently as the appellant's assistant and adviser. In such circumstances, and having regard to the comparative brevity of the time default, it is difficult for a court of justice not to look most closely at the statutory language to see whether any ambiguity might properly be resolved so as to ensure that a person, such as the appellant, is afforded a real opportunity to engage the judicial branch of Australian government. The Act provides for such engagement, in this case of the Federal Court. In default of an effective engagement of the Federal Court, a possible consequence could be an increase in applications to this Court for discretionary relief under the Constitution82 – an outcome not immediately appealing. The appellant's submissions: Against this background, it was argued for the appellant that he had not been "notified of the decision" as s 478(1)(b) of the Migration Act required. Hence, it was submitted that the time limit of 28 days for the lodgment of an application to the Federal Court had not commenced. At least, it was submitted, it had not commenced until the appellant had received from Ms Alamar the "statement" under s 430 of the Migration Act. It would appear that this may have occurred three weeks after the conversation with Ms Alamar on 16 March 2001. For the appellant, it was said that this Court should resolve any undetermined issue of fact in his favour. This was because he had not been cross-examined on his testimony; Ms Alamar had not been called to deny it; the testimony was consistent with the appellant's apparent illiteracy; and, in case of doubt, the issue should be so decided because it was the Minister who was seeking summary relief in the Federal Court based on affidavit evidence alone. The appellant disputed the conclusions of the Federal Court that being "notified of the decision" meant no more than being notified of the result of the Tribunal's hearing. To construct this argument, the appellant relied on four steps. First, he said that the word "notified" connoted something more than mere provision of information. From the meaning of the word83 and from its context in 82 Constitution, ss 75(iii) and 75(v). See Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476. 83 In the Encarta World English Dictionary (1999) at 1294 the first given meaning is "Tell officially: to inform or warn …". In the Macquarie Dictionary, 3rd ed (rev) (2001) at 1311 and the Shorter Oxford English Dictionary, 5th ed (2002) at 1947 the connotation of official signification is not stated, although in the examples (Footnote continues on next page) Kirby s 478 of the Migration Act, it implied a formal or official notification for a particular purpose84. That purpose was to set in train proceedings of considerable importance to persons, such as himself, claiming refugee status. It engaged the jurisdiction of the Federal Court, a court established under Ch III of the Constitution. Moreover, as s 478(1) of the Migration Act indicated, the notification of the decision was to be such as to permit an "application" to the Federal Court to be made as specified under the Rules of that Court. Those Rules85 contemplate appropriate particularity in the identification of the grounds of an application for judicial review. In the context, therefore, the requirement to "notify" the appellant of the "decision" had to be one that involved a notification apt for its purpose, namely the initiation with appropriate specificity of an application to the Federal Court. Secondly, the appellant argued that s 478 had to be read as an integral part of the "code" provided by the Migration Act for the delivery of "decisions" of the Tribunal. That "code" included s 430(1) of the Act, which contemplated the provision of a "written statement" that would afford precisely the material upon which a person (such as the appellant) in immigration detention could effectively initiate judicial review of the kind envisaged by ss 476 and 477 of the Migration Act. The obligation to provide copy of that "statement" to a potential applicant for judicial review, within a brief time, indicated the intended interaction of notification of the "decision" and provision of the "statement". In the case of a person (such as the appellant) in immigration detention, the "code" required the Tribunal to give an applicant (and the Secretary) a copy of the "statement" within fourteen days after the "decision" concerned was made86. Where this was not done, the appellant submitted, time would not run because the provision of the statement as well as a notification of the "decision" was part of the inter-related scheme of the Migration Act. Thirdly, the appellant pointed out that the amendments to the Migration Act, enacted in 1998, drew an express distinction between the provision of "the outcome of the decision"87 and "being notified of a decision"88. By inference, given in the Shorter Oxford English Dictionary the connotations are of official notifications. 84 See Antico v C E Heath Casualty and General Insurance Ltd (1996) 38 NSWLR 85 Federal Court Rules (Cth), O 54B, rr 1, 2(1), Form 56A. 86 Migration Act, s 430D(2). 87 Section 430B(3)(a). 88 Section 478(1)(b). Kirby after 1998, "being notified of a decision" meant more than mere notification of the "outcome of the decision". It followed, according to the appellant, that the notification by Mr Wallis of the result of the appellant's application to the Tribunal was not enough to notify the appellant of the decision. Nor did to such a immediately notification. thereafter amount Fourthly, the appellant emphasised the need to construe the Migration Act with its purpose in mind, namely to facilitate effective engagement of the Federal Court by an application under s 476 or s 477 of that Act. In the case of illiterate unaccompanied minors (but also in many other cases) it was of the nature of the "applications" for which the Parliament has provided that they were of great importance to the persons affected and to the fulfilment of Australia's national protection obligations under the Refugees Convention. In such circumstances, the words "notified of the decision" should be construed to amount to a real and effective notification – one that would fulfil the purpose of engaging the jurisdiction of the Federal Court. It was not sufficient, in the case of a blind applicant, to provide such a person silently with a document typed in the ordinary way in the English language. Similarly, in the case of an illiterate minor, it was not sufficient to "notify … the decision" by telling him of its "outcome". It was essential to provide him with the statement envisaged by s 430(1) and indeed a translation of that statement or its main part into the language that could be read to (and understood by) him, as constituting the essential "reasons" and "findings" of the Tribunal. Nothing less was sufficient to render the statutory right to judicial review a substantive reality. Because it was common ground that no such translation had been provided, the appellant had not been "notified of the decision". The time limit in s 478 of the Migration Act was not engaged. The Federal Court had jurisdiction to hear the application. The appellant was "notified" of the "decision" Duty of fidelity to the Act: It will be apparent that I have much sympathy for the appellant's predicament. On the factual merits it would be impossible to feel otherwise. If I could properly find in his favour, I would. If I could join with the other members of the Court in their analysis and conclusions, I would gladly do so. However, I cannot. I must therefore explain why the appellant's arguments should not be accepted. A natural feeling of sympathy may not distort the application of the Migration Act to achieve the purpose of the Parliament, however rigid and unjust that purpose may appear89. That Act applies to a wide range of applicants. So long as it is valid in this respect (a matter not contested), the Migration Act must be given effect according to the terms enacted by the 89 See Minister for Immigration and Multicultural and Indigenous Affairs v B (2004) 78 ALJR 737 at 768-769 [171]-[176] of my own reasons; 206 ALR 130 at 173-174. Kirby Parliament. It is no part of this Court's function to adopt a strained interpretation in order to cure or avoid the apparent injustice of the particular case. Critical notification of a "decision": The essential problem for the appellant's construction is that the time limit fixed by the Migration Act for applications for judicial review to the Federal Court is expressed by reference to being "notified" of the "decision". That is how s 478(1)(b) is worded. When regard is had to s 430 of the Migration Act, it is clear from its language that it draws a sharp distinction between the "decision on a review" and the "reasons for the decision", "findings on any material questions of fact" and reference "to the evidence or any other material"90. The "written statement", to which s 430 of the Migration Act refers, is also differentiated from the "decision of the Tribunal". In such a context, the reference to being "notified of the decision"91 must be taken to be a reference to notification of the result of the Tribunal's review. Separate provision is made for the "written statement". That separate provision is also reflected in the sections that were added to the Migration Act in 199892. History of legislative changes: With all respect, the course of the legislative history strongly tells against the conclusion now embraced by the majority of this Court. The former provisions of s 138(3) of the Migration Act, described as the "progenitor"93 of s 478(1)(b), made its command perfectly clear. An appeal was to be instituted "within 28 days after the appellant is notified under section 135 of the decision concerned."94 Section 135 was the provision requiring the relevant tribunal "to record its decisions etc and to notify parties"95. As the majority in this Court point out96, the italicised words were repealed by the amendment inserted into the "code" introduced in 1998. The Parliament deliberately deleted not only the provision in the heading to the section referring to notification to the parties (a matter of itself not, perhaps, determinative). It also deleted the cross-reference to the "statement" provisions – so that this explanation of the mode of notification by the "statement" (now under s 430 for such cases) was specifically withdrawn. The change in the heading was accurate. 90 Migration Act, s 430(1). 91 Migration Act, s 430D(1). 92 See ss 430A(4)(a), 430B(5), 430B(6), 430B(7), 430D(2). 93 Joint reasons at [16]. 94 Migration Act, s 138(3) (emphasis added). 95 Migration Act, heading (emphasis added). 96 Joint reasons at [17], fn 10. Kirby The special statutory form of notification was repealed. Thereafter, notification was to assume its ordinary meaning. Such was the will of the Parliament. "Decision" means result: Whilst it is true that s 430B of the Migration Act refers to the reading of the "outcome of the decision", that provision cannot affect the appellant's case or the meaning, as applicable to his case, of s 478 of the Migration Act. This is because s 430B(1)(b) of that Act makes it clear that the section in which reference is made to "the outcome of the decision" has no application to a person, like the appellant, "who is in immigration detention". The reference to "outcome" in that section cannot therefore distort the meaning of "the decision" throughout the entirety of that Part of the Migration Act. The "decision" is the result of the review undertaken by the Tribunal. Both in its ordinary meaning, and in the differentiations drawn by the Migration Act, the "decision" is thus separate from, and different to, the reasons, findings and reference to material and the "written statement" for which the Migration Act specifically provides. In my respectful opinion, it would involve an artificial and contra-textual interpretation of the Migration Act to adopt a different view. In the case of a person in detention, like the appellant, s 430D of the Migration Act applies. That section is poorly worded. Section 430D(2) is the only subsection specifically addressed to an applicant "in immigration detention" when the decision is made other than as an "oral decision", to which s 430D(1) applies. Such wording is curious because, although the heading appears to relate to all parties not invited to the handing down of the decision97, only s 430D(2) is expressed to apply to an applicant in immigration detention. Section 430D(1) applies where the Tribunal delivers an "oral decision" and not one that is in writing and suitable to be "handed down", as the decision in the appellant's case was98. If s 430D applies in its totality to an "applicant … in immigration detention", it is expressly stated in s 430D(1) that "the applicant is taken to be notified of the decision on the day on which the decision is made". By a statutory fiction, that provision reinforces the commencement of the running of time for the purpose of s 478 of the Migration Act so that time starts running on the day on which the "decision" was made, whether or not (and whenever) the applicant was made aware of it. The context of rigid time limits: A careful reading of s 430D of the Migration Act will dispel any lingering belief that a court might have entertained that the Parliament was here endeavouring (although in a cumbersome way) to 97 Migration Act, s 430D, heading. 98 Migration Act, s 430D(2). Kirby make sure that time would not run against a person such as the appellant until he received the "written statement" provided for in s 430 of that Act. That requirement, which once expressly applied, was expressly repealed. This Court has no authority to put it back again. It follows that, once again, this Court is faced with an inflexible, unyielding provision of the Migration Act, passed into law by the Parliament of the Commonwealth. Whatever may be thought of such provisions, courts are bound by the Constitution to give effect to them when valid. We have done so before99. In this case, in my view, we should do so again. Assuming, as I would hold, that s 430D(1) does not apply to the appellant's case so as to fix him with deemed notice even before he was informed of the result of the Tribunal's review, but that only s 430D(2) applies to him, the terms of s 430D(1) indicate clearly enough the deliberate rigidity of the time provisions of the Migration Act in respect of cases such as the appellant's. That sub-section shows that it would not be correct to read the Migration Act on an assumption, apparently accepted by the majority in this Court, that its purpose was to protect and facilitate the right to judicial review provided in that Act100. An analysis of the object of the time provisions in the Migration Act indicates that, to the contrary, those provisions were intended by the Parliament to impose extremely severe limitations which are very short and rendered expressly unyielding even to special circumstances101. Concern about delays in the conclusion of determinations of refugee status in the four-tiered processes available in Australia is notorious. In such circumstances, the legislative imposition of a brief, inflexible time limit upon applications for judicial review of Tribunal decisions can cause no real surprise. At least this is so, viewing the Migration Act wholly within an Australian context102. There was no duty to translate: In the provisions of the Migration Act for the preparation of a written statement by the Tribunal, no requirement for translation of the reasons, findings, evidence or any shorter summary is spelt out. A general obligation of translation would involve significant public costs. Had translation been the purpose of the Parliament, it would therefore have been 99 B (2004) 78 ALJR 737; 206 ALR 130; Singh v Commonwealth of Australia [2004] HCA 43. 100 B (2004) 78 ALJR 737 at 768 [171]; 206 ALR 130 at 173. 101 See also s 478(2). 102 See B (2004) 78 ALJR 737 at 768 [171]; 206 ALR 130 at 173. Kirby expected that express provision would be made in that regard. Other federal103, State104 and Territory105 legislation in Australia makes express provision for translation of specified documents and other matters. The Migration Act does not. In the face of statutory silence, and especially in this Act, this Court could not introduce obligations of translation on the false hypothesis that such a purpose should be attributed to the Parliament by techniques of statutory construction. In the case of this Act, the revealed purposes of the Parliament were quite the opposite. When the requirements of s 478(1)(b) of the Migration Act are read against the background of the foregoing considerations, it is clear that the appellant was "notified" of the "decision" of the Tribunal on 16 March 2001. The duty of the Tribunal to give an applicant a copy of the statement under s 430(1) of the Migration Act was a separate and distinct obligation106. Originally, it was integrated with notification but that integration was deliberately repealed. In the appellant's case, the time when that statement was provided was therefore distinct from the time of being "notified" of the "decision". However desirable it might be to afford to persons in the position of the appellant a notification, in a language in which they are fluent, of the "decision", the substance of the s 430(1) "statement" and a warning about the strict time limit for commencing proceedings in the Federal Court, the Migration Act makes no provision in that respect. It would not be a valid performance of this Court's duty of interpretation of s 478(1)(b) for it to import a precondition of the supply of the "statement" (still less a translation of the whole or some unspecified part thereof) into the clear language of that paragraph. 103 See Australian Security Intelligence Organisation Act 1979 (Cth), s 34H; Crimes Act 1914 (Cth), ss 23F(2), 23N, 23YDA; Defence Force Discipline Act 1982 (Cth), ss 101C(2A), 101U(2)(a), 101U(3); International Transfer of Prisoners Act 1997 (Cth), s 6(3). 104 See Mental Health Act 1990 (NSW), s 292; Crimes (Forensic Procedures) Act 2000 (NSW), s 98; Crimes Act 1958 (Vic), s 464D; Occupational Health, Safety and Welfare Act 1986 (SA), s 21(2); Environment, Resources and Development Court Act 1993 (SA), s 46; Summary Offences Act 1953 (SA), s 81(3)(c); Evidence Act 1929 (SA), s 14; Mental Health Act 1996 (WA), s 97(4)(a); Criminal Law (Detention and Interrogation) Act 1995 (Tas), s 5; Forensic Procedures Act 2000 (Tas), s 60. 105 Human Rights Act 2004 (ACT), s 22(2)(a). 106 Section 430D(2). Kirby Conclusion: the decision was "notified": By the clear language of s 478(1)(b) of the Migration Act and the equally clear purpose of the Parliament, the time for the lodgment of the application for judicial review in the Federal Court began to run from the moment the appellant was notified of the "decision". Whatever problem might arise where an applicant had no ability at all to understand the limited information to be contained in such notification107, it does not arise in this case. The notification was given orally. The appellant was told that he had lost. That much was not contested. That much was translated into the appellant's language. His awareness of it is confirmed by his immediate emotional response which was common ground. He broke down and sobbed. The primary judge and the Full Court were correct as a matter of law to decide as they did. They were doing no more than the Constitution requires108. They were giving effect to the language and purpose of a valid enactment of the Federal Parliament according to its terms. That is also the duty of this Court. The Minister's alleged obligations as guardian The appellant's arguments: Before the Full Court, the only way that the appellant argued the application of the Guardianship Act was as that Act affected the appellant's being "notified" of the decision. This argument suggested that, because under the Guardianship Act the Minister was the statutory guardian of the appellant as a "non-citizen child" and because the Minister had not delegated his functions as such guardian, he was bound to ensure, in the appellant's case, that the appellant was "notified of the decision" in a meaningful way. In short, it was complained that the Minister had failed in his duties as statutory guardian of the appellant by omitting to provide the appellant, a minor under his protection, with such assistance as was necessary so that the notification of the "decision" and its significance for the appellant would be brought home to him in order that his legal rights might be effectively and promptly safeguarded109. Having regard to the meaning that I would adopt of the expression "the applicant being notified of the decision" in s 478(1)(b) of the Migration Act as it then stood, the omissions (if any) of the Minister under the Guardianship Act are irrelevant to the commencement of the running of time against the appellant for 107 cf Felts v Murphy 201 US 123 at 128 (1906). See La Vigne and Vernon, "An Interpreter Isn't Enough: Deafness, Language and Due Process", (2003) Wisconsin Law Review 843 at 886-892. 108 Constitution, covering cl 5. 109 Creyke, "Current and Future Challenges in Judicial Review Jurisdiction: A Comment", (2003) AIAL Forum 42 at 49, where the anomaly and apparent conflict of interest and duty in the Minister's position are called to notice. Kirby the bringing of an application to the Federal Court for judicial review. By specific provision, the Migration Act has chosen as its trigger for the running of time a particular and clearly identified event. So long as the person who wished to apply to the Federal Court had been "notified of the decision", duties (if any) arising under other legislation were irrelevant for this purpose. At least they were irrelevant in a case such as the present where there is no question that the "decision", understood as explained above, was "notified" in the sense of formally signified to the appellant in terms that he could understand. The issue does not arise: Once one accepts (as I would) that "the decision", in this context, means the result of the Tribunal's review, rather than its reasons and findings, the ambit of the understanding necessary to be "notified" under the Migration Act is very limited. On the findings made by the primary judge in this case, confirmed by the Full Court, such notification was fulfilled in the case of the appellant. He understood the result of the decision. This being so, it is unnecessary for this Court, in these proceedings, to consider the defects (if any) in the Minister's performance of the guardianship function provided for in s 6 of the Guardianship Act. During argument, a question arose as to whether the Guardianship Act applies at all to alien children, such as the appellant, arriving in Australia as an "unlawful non-citizen"110. The Solicitor-General of the Commonwealth took instructions and affirmed that the Minister's position was that the Guardianship Act applied to the Minister in respect of a person such as the appellant. Specific provisions exclude any general ones: Assuming (without deciding) that this is the case, it does not alter the operation of the Migration Act in the express terms in which s 478 was enacted111. Any general powers and obligations of the Minister under the Guardianship Act would have to be read as subject to the more specific provisions of the Migration Act, enacted to apply with respect to all applications for judicial review of decisions of the Tribunal created by the latter Act. By its specific terms, s 478 of the Migration Act was enlivened in the appellant's case by "being notified of the decision" of the Tribunal. Such explicit provisions take priority over any general duties owed by the Minister under the Guardianship Act. The Migration Act accepts the hypothesis that persons notified of adverse decisions, even if not explicitly so informed, would know that they have to pursue any rights to challenge or question such decisions very quickly. Whether or not that is a correct hypothesis to accept in the case of persons in immigration detention, such as the appellant, it is the one adopted by the Parliament and reflected in s 478. Courts must give effect to such provisions. 110 Migration Act, ss 189, 196. 111 See B (2004) 78 ALJR 737 at 769 [176]; 206 ALR 130 at 174. Kirby Requirements of procedural fairness: If, as was asserted, the Minister was indeed the guardian of the appellant as a "non-citizen child" within the Guardianship Act, questions might arise as to whether the Minister fulfilled his duties as guardian in the present case. For several reasons, however, any such questions would have to be left to such separate proceedings as might be brought in respect of them. First, there is a threshold question, not yet finally determined, as to whether the Guardianship Act applies to a case such as the appellant's. Secondly, there is an issue as to what the incidents of such a statutory guardianship would be in such a case. Thirdly, because of the limited way in which this point was argued in the courts below, evidence was not specifically addressed to it and the only point about it, decided by the Full Court, related to the notification point upon which that Court held against the appellant. Fourthly, if the issue arises at all, it is outside the grounds upon which special leave was initially granted to the appellant. It is only raised by motion in a challenge to an earlier ruling of the Federal Court that does not bind this Court112. In these circumstances, it would be necessary, in the view that I take, for consideration of the requirements of the Guardianship Act to await other proceedings in which the issue had been litigated from the start and refined by the decision of an intermediate court. The complaint of no "decision" by the Tribunal Finally, the appellant's grounds of appeal complained that the Full Court erred when, before dismissing the appellant's appeal, it failed to consider whether there had been jurisdictional error on the part of the Tribunal with the effect that there had been no "decision" under the Migration Act that could engage the time limit fixed by s 478(1)(b). I am prepared to assume that the "decision" referred to in s 478(1)(b) of the Migration Act must be read so as to refer to a "decision" which involved neither a failure to exercise jurisdiction nor an excess of jurisdiction conferred by the Act113. However, the substantive complaints of the appellant related to what happened after the "decision" of the Tribunal was made, as that word was to be construed in the context. Having regard to the preceding conclusion and to the way this appeal was argued, there is no separate merit in the jurisdictional point. The Tribunal made its decision and handed it down. It was notified to the 112 The appellant's motion sought to add a ground complaining that the Full Court of the Federal Court had erred "when it applied the decision … in Odhiambo v Minister for Immigration and Multicultural Affairs which is distinguishable both on its facts and by the manner in which the appeal was conducted." 113 Plaintiff S157/2002 (2003) 211 CLR 476 at 495 [41], 506 [76]. Kirby appellant. The appellant belatedly sought judicial review of that decision. Before the Federal Court, upon the Minister's preliminary objection as to the competency of the application, the appellant's complaint concerned how the decision was communicated to him. It did not complain that no true "decision" was ever made by the Tribunal. Conclusion and order The Minister is entitled to succeed. That is because of the inflexible time limitation deliberately enacted by the Parliament in respect of all cases of judicial review by the Federal Court directed to this particular Tribunal concerning persons such as the appellant. So long as such provisions are valid under the Constitution (and they were not challenged in this appeal), this Court must give effect to them in an appeal such as this114. It must do so whatever views might be held about the operation of the Migration Act in the circumstances of the particular case. Whilst I would gladly have come to the opposite view out of sympathy to the appellant, I cannot do so upon my analysis of the Migration Act. There is no relevant ambiguity. The purpose of the Migration Act is clear. The judicial duty is to give effect to the law. It follows that the appeal must be dismissed. 114 See Plaintiff S157/2002 (2003) 211 CLR 476 at 535-536 [165]-[166].

HIGH COURT OF AUSTRALIA HARBOUR RADIO PTY LIMITED APPELLANT AND RESPONDENT Harbour Radio Pty Limited v Trad [2012] HCA 44 5 October 2012 ORDER Appeal allowed. Set aside the orders of the Court of Appeal of the Supreme Court of New South Wales made on 22 March 2011, and in lieu thereof order that: the appeal to that Court be allowed; the orders of the Common Law Division made on 6 August 2009 be set aside. Declare that the defence of qualified privilege at common law with respect to imputations (a), (b), (c), (d), (g) and (j) is made good. Remit the matter to the Court of Appeal for consideration of: the defences of substantial truth with respect to imputations (b), (c), (d) and (g) and contextual truth with respect to imputations (h) and any questions of remitter to the Common Law Division for assessment of damages if the Court of Appeal holds that a defence of contextual truth does not apply in relation to imputations (h) and all questions of costs of proceedings in the Common Law Division and the Court of Appeal. No order as to costs of the appeal or cross-appeal to this Court. On appeal from the Supreme Court of New South Wales Representation R G McHugh SC with G R Rubagotti for the appellant (instructed by Banki G O'L Reynolds SC with C A Evatt and R K M Rasmussen for the respondent (instructed by Turner Freeman Lawyers) at the hearing on 3 February 2012 G O'L Reynolds SC with R K M Rasmussen for the respondent (instructed by Turner Freeman Lawyers) at the hearing on 5 March 2012 Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Harbour Radio Pty Limited v Trad Defamation – Defences – Qualified privilege – Contextual truth – Substantial truth – Reply to criticism – Malice – Where appellant made broadcast in response to statements made by respondent – Whether defence of qualified privilege applicable to statements – Whether broadcast sufficiently connected to criticism by respondent – Whether broadcast made bona fide to vindicate reputation of appellant – Whether broadcast actuated by malice – Whether community standard test of "right-thinking" person relevant to substantial or contextual truth defence – Whether audience composed of ordinary decent persons relevant to substantial truth or contextual truth defence. Words and phrases – "contextual truth", "malice", "qualified privilege", "substantial truth". Defamation Act 1974 (NSW), ss 3, 7A, 9, 11, 15, 16. GUMMOW, HAYNE AND BELL JJ. The principal issues of defamation law in this appeal from the New South Wales Court of Appeal (Tobias, McColl and Basten JJA)1 concern the defence at common law of qualified privilege. The proceedings are governed by the Defamation Act 1974 (NSW) ("the 1974 Act"), rather than the Defamation Act 2005 (NSW)2. The effect of s 11 of the 1974 Act was to preserve the common law defence. The objects stated in s 3 of the 1974 Act include the provision of "effective and appropriate remedies for persons whose reputations are harmed by the publication of defamatory matter" (par (a)) and, on the other hand, ensuring "that the law of defamation does not place unreasonable limits on the publication and discussion of matters of public interest and importance" (par (b)). It will be apparent that there may be some tension between these objects. Further, the width of the principles governing the defence of qualified privilege emphasises the need, in deciding whether they apply in a particular case, to scrutinise closely the circumstances of the case, the situation of the parties and the events leading up to and surrounding the defamatory publication in question3. The sequence of events leading up to this litigation begins in 2005 with major public disturbances in New South Wales at Cronulla Beach. These have become known generally as the "Cronulla Riots" and have been perceived by some as a confrontation between adherents of Islam and persons of European descent who are not Muslims. The peace rally Approximately one week after the Cronulla Riots, the respondent (Mr Trad) attended and was one of the speakers at a "peace rally" in Hyde Park, in the centre of Sydney. This was held on Sunday 18 December 2005 and was attended by about 5000 people. Representatives of the media were present. In the course of his speech Mr Trad said: 1 Trad v Harbour Radio Pty Ltd (2011) 279 ALR 183. (2011) 279 ALR 183 at 185 [2]. 3 Guise v Kouvelis (1947) 74 CLR 102 at 116; [1947] HCA 13; Bashford v Information Australia (Newsletters) Pty Ltd (2004) 218 CLR 366 at 373 [10], 417 [139]; [2004] HCA 5. Bell "I never lost my faith in the great people of this nation and if a handful of students can muster so many thousands of true Australians here today, then this is a poke in the eye of those racist rednecks in tabloid journalism". Later in his speech Mr Trad used words, the effect of which was to place specifically at least part of the blame for the Cronulla Riots on the appellant's commercial radio station, Radio 2GB. He said that there was "a great deal of shame in tabloid journalism" and that "one talk back radio station ... seems to be nothing other than the mouthpiece of the Howard government over the last few years". The crowd responded "2GB", and Mr Trad continued, "[t]his station yes[. I]t is winning the ratings in its small niche in the Sydney market, it is winning the ratings, it is whipping up fears." He added that Muslims in Australia were "suffering as a result of the racist actions of predominantly one radio station". Lengthy extracts from Mr Trad's speech are set out in the reasons of the Court of Appeal4. The broadcast In a program that went to air on Radio 2GB at about 10.05am on the next day, Monday 19 December 2005, and which lasted some 11 minutes with at least one commercial break, the radio "host", Mr Jason Morrison, conducted a monologue. This was broken by a short excerpt from a recording of the public rally the day before, and by talk-back calls involving a discussion between him and the callers. The text of the broadcast, being the matter complained of by Mr Trad in his defamation action against the appellant ("2GB"), is set out in the reasons of the Court of Appeal5. In his amended statement of claim, Mr Trad alleged that the matter complained of conveyed imputations which he identified by reference to numbered paragraphs in the text of what Mr Morrison had said, as follows: "[13] Now that's Keysar Trad at a peace rally ... Now I'm sorry about the quality of that [recording of the rally], but as I said Chris [Glasscock] our reporter there had to pull back because it wasn't safe for him to be standing at the front while all this was going on. [14] And it goes on, there is about ten minutes of this bile about how evil and hate filled this radio station is and about how we incite people to (2011) 279 ALR 183 at 189-190 [14]. (2011) 279 ALR 183 at 186-189 [11]. Hayne Bell commit acts of violence and racist attitudes. I don't think that I've ever quite done that, like he did. In fact I don't think anyone here has ever done anything quite like that. ... [16] Now, Keysar Trad, you are a disgraceful individual and I'm not alone in thinking this, I won't talk to you on the air because you represent no one's views other than your own, so you know, why you call up purporting to be from the Islamic community is beyond me. You are one guy who basically has been marginalized. And I think the more you say the more you represent to me that you are a dangerous individual to be out there trying to represent the views because I think you're responsible about more misinformation about the Islamic community of the attitudes of Christian Australians than any other person. [17] Now he is widely perceived as a pest, that's the way I see him, he is not a peacemaker, so why he was invited to a peace rally is beyond me. ... [24] ... I mean this guy has a media monitoring company basically watching about any reference about him or for any reference that he believes will be advantageous towards his cause and there he is straight on the phone straight on the fax pumping out letters of complaint, he is one of the most complaining people around the place and he does nothing to try to address the actual issues, he just wants to sort of hatchet job people who once gave him the privileged position that he thinks he has." (emphasis added) The course of the litigation Section 7A of the 1974 Act sets up procedures for the trial of defamation actions which depart radically from the common law system of trial6. The common law classified as a question of law the question whether the matter complained of was or was not capable of bearing a defamatory meaning, and as a question of fact for the jury whether the matter was or was not defamatory. The issue whether an occasion was one of qualified privilege was for decision by the judge, that of whether the privilege was forfeited by malice was for the jury7. The s 7A structure divides the trial process into three stages. John Fairfax Publications Pty Ltd v Gacic (2007) 230 CLR 291 at 303-305 [31]-[41]; [2007] HCA 28. 7 Minter v Priest [1930] AC 558. Bell At the second stage, that pursuant to s 7A(3) of the Act, a jury found that the following eight imputations were conveyed in the 2GB broadcast and were defamatory of the plaintiff, Mr Trad: the plaintiff stirred up hatred against a 2GB reporter which caused him to have concerns about his own personal safety; the plaintiff incites people to commit acts of violence; the plaintiff incites people to have racist attitudes; the plaintiff is a dangerous individual; the plaintiff is a disgraceful individual; the plaintiff is widely perceived as a pest; the plaintiff deliberately gives out misinformation about the Islamic community; the plaintiff attacks those people who once gave him a privileged position."8 The issues before this Court require close attention to the terms of each of these imputations. The Court of Appeal correctly observed that at least some of the imputations are expressed in terms which are unclear9. However, in the amended statement of claim, by way of particulars of each imputation, reference was made to a numbered paragraph in the text of the broadcast, as indicated above10. Any challenge to the form of the imputations should have been taken before the s 7A jury trial. Each of these imputations constituted a cause of action, as s 9 of the 1974 Act confirmed. The third and final stage laid down by s 7A(4) required the Supreme Court (McClellan CJ at CL), not a jury, to determine all issues of law and fact relating to any defence raised by 2GB and to determine the amount of any damages to be awarded to Mr Trad. The defences upon which 2GB relied included those of substantial truth and contextual truth respectively under ss 15 (2011) 279 ALR 183 at 185 [2]. (2011) 279 ALR 183 at 205-206 [94]-[100]. Hayne Bell and 16 of the 1974 Act11, and fair comment on a matter of public interest under Pt 3 Div 7 of the Act (ss 29-35). 2GB also pleaded that each imputation was published on an occasion of qualified privilege at common law. The occasion was said to be a response by 2GB to the public attack by Mr Trad at the peace rally. McClellan CJ at CL dismissed Mr Trad's case and entered judgment for 2GB. His Honour found that imputations (b), (c), (d) and (g) were substantially 11 Section 15 stated: "(1) Notwithstanding section 11, the truth of any imputation complained of is not a defence as to that imputation except as mentioned in this section. (2) It is a defence as to any imputation complained of that: the imputation is a matter of substantial truth, and the imputation either relates to a matter of public interest or is published under qualified privilege." Section 16 provided: "(1) Where an imputation complained of is made by the publication of any report, article, letter, note, picture, oral utterance or other thing and another imputation is made by the same publication, the latter imputation is, for the purposes of this section, contextual to the imputation complained of. (2) It is a defence to any imputation complained of that: the imputation relates to a matter of public interest or is published under qualified privilege, one or more imputations contextual to the imputation complained relate to a matter of public interest or are published under qualified privilege, and are matters of substantial truth, and by reason that those contextual imputations are matters of substantial truth, the imputation complained of does not further injure the reputation of the plaintiff." (emphasis added) Bell true and had the effect that the publication of imputations (a), (h), (j) and (k) occasioned no further injury to the reputation of Mr Trad. Further, his Honour upheld the defence of qualified privilege in respect of all the imputations and rejected the claim by Mr Trad that the privilege was defeated by malice. With respect to the defence of comment his Honour found that imputations (b), (c), (d) and (g) were expressions of opinion based upon Mr Trad's attack on 2GB at the peace rally. On appeal by Mr Trad, the Court of Appeal held that the primary judge had erred in this respect12. There is no ground of appeal in this Court concerning that issue. The Court of Appeal also held that the findings by the primary judge of substantial truth had "proceeded on a false basis" and could not be sustained13, and 2GB challenges that outcome. With respect to qualified privilege, the Court of Appeal differed in part from the primary judge and held that the defence should not have been upheld as regards imputations (c), (h) and (k). This was said to be because these imputations were not "sufficiently linked" to the occasion of qualified privilege, being the response by 2GB to the public attack by the respondent14. The Court of Appeal ordered that the proceedings be remitted to the Common Law Division for the assessment of damages in relation to these three imputations15. The appeal to this Court The principal emphasis by 2GB has been upon restoration of the holding of the primary judge in its favour on qualified privilege as to all the imputations. On his part, Mr Trad seeks to expand his success in the Court of Appeal and to achieve rejection of the qualified privilege defence in respect of the remaining imputations (a), (b), (d), (g) and (j), and an order for remitter to the Common Law Division for assessment of damages on all imputations. 2GB also complains of the treatment by the Court of Appeal of its defences of truth and contextual truth. 12 (2011) 279 ALR 183 at 203-206 [88]-[102]. 13 (2011) 279 ALR 183 at 203 [87]. 14 (2011) 279 ALR 183 at 209 [111]-[113]. 15 (2011) 279 ALR 183 at 210 [125]. Hayne Bell With respect to qualified privilege, something should be said immediately about the relationship between imputations (b) and (c). The former was that Mr Trad incites people "to commit acts of violence", the latter was that he incites people "to have racist attitudes". The Court of Appeal upheld the defence of qualified privilege with respect to (b) but not to (c). In submissions to this Court the parties submitted that each imputation should share the fate of the other. That is to say, if 2GB succeeded in its submissions both imputations would attract the privilege, and if Mr Trad succeeded neither would do so. As remarked above, the peace rally and the broadcast were sequelae to the Cronulla Riots, which attracted considerable public attention. The defence of qualified privilege was pleaded by 2GB on the footing that the broadcast was a response made to the public after Mr Trad had attacked 2GB, in public, at the peace rally the previous day, and so satisfied the requirement for the defence of a reciprocity of duty or interest. There was some attention in submissions to this Court to the nature of this reciprocity in such cases of public replies to public criticism. A starting point is that it is only in exceptional cases that the common law has recognised an interest or duty to publish defamatory matter to the general public16. Each side then presented a submission as to what followed as a matter of fundamental principle. Neither submission should be accepted. The Court of Appeal observed that in the situation here the defamation law "provides a rare example of the law permitting an individual to seek self-redress by conduct that would otherwise be unlawful"17. Mr Trad was anxious to restrict the permitted scope of the counter-attack by 2GB. To that end, counsel referred to the analogy with self-defence in cases of assault to which reference was made in Norton v Hoare [No 1]18. This was decided before Adam v Ward19. Self-defence is not at large and, for example, 16 Stephens v West Australian Newspapers Ltd (1994) 182 CLR 211 at 261; [1994] HCA 45; Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 570; [1997] HCA 25. 17 (2011) 279 ALR 183 at 207 [108]. 18 (1913) 17 CLR 310; [1913] HCA 51. Bell does not extend to blows struck in revenge20. Hence the attraction of the analogy Counsel for Mr Trad submitted that cases where qualified privilege was claimed for defamatory responses to attacks were not readily accommodated to what had been said by Parke B in Toogood v Spyring21 and to what counsel called "a duty and interest analysis". It may be accepted that the accommodation is not readily made, but it has been made. One asks, what duties or interests were engaged between 2GB as publisher and the listeners to whom the broadcast was made?22 It should be emphasised that it is here that the necessary reciprocity is to be found, not in any relationship between 2GB and Mr Trad, although it was with this that the broadcast largely was concerned, as a response (or retaliation) to criticism of 2GB by Mr Trad at the peace rally. This consideration will be relevant particularly when considering imputation (k)23. In Mowlds v Fergusson24, Dixon J explained what should be accepted as the applicable law to a case such as the present in the following terms: "Any communication which the defendant might make tending to vindicate his conduct or rehabilitate his reputation would be a subject of privilege provided that the person to whom he made the communication were one proper to receive it. It is commonly said that the recipient must possess an interest or be under a duty which corresponds with the interest of the person making the communication: See, eg, White v J & F Stone (Lighting and Radio) Ltd25, a case with which Somerville v Hawkins26 and 20 McClelland v Symons [1951] VLR 157 at 162-163. 21 (1834) 1 Cr M & R 181 at 193 [149 ER 1044 at 1050]. 22 See Bashford v Information Australia (Newsletters) Pty Ltd (2004) 218 CLR 366 at 377 [23] per Gleeson CJ, Hayne and Heydon JJ. 24 (1940) 64 CLR 206 at 214-215; [1940] HCA 38; cf Norton v Hoare [No 1] (1913) 17 CLR 310 at 318 per Barton ACJ. 25 [1939] 2 KB 827 at 834. 26 (1851) 10 CB 583 [138 ER 231]. Hayne Bell Taylor v Hawkins27 should be compared. Where the defamatory matter is published in self-defence or in defence or protection of an interest or by way of vindication against an imputation or attack, the conception of a corresponding duty or interest in the recipient must be very widely interpreted. In Adam v Ward28 the interest of every citizen in the welfare of the army seems to have been considered enough by Lord Atkinson, who alone of their Lordships emphasized the necessity of reciprocity29." Contrary to the respondent's submission, this reasoning is not at odds with what had been said in this Court, before Adam v Ward30 was decided, in Norton v Hoare [No 1]31 by Barton ACJ32 and Isaacs, Gavan Duffy and Rich JJ33. In Norton, Isaacs, Gavan Duffy and Rich JJ referred to various authorities which to them showed34: "that in defence of property an assault on the person or the property of another may be justified, if necessary for the protection of the defendant's property. And see Halsbury's Laws of England35. Though couched in somewhat different terms, the rule is substantially based on the same to privileged fundamental considerations as communications formulated in Toogood v Spyring36, which, as Parke B says37, must be 'fairly warranted by any reasonable occasion or exigency', that with regard 27 (1851) 16 QB 308 [117 ER 897]. 28 [1917] AC 309 at 343. 29 [1917] AC 309 at 334. 31 (1913) 17 CLR 310. 32 (1913) 17 CLR 310 at 318. 33 (1913) 17 CLR 310 at 322. 34 (1913) 17 CLR 310 at 322. 35 Volume 9, "Criminal Law and Procedure" at 609 [1231]. 36 (1834) 1 Cr M & R 181 [149 ER 1044]. 37 (1834) 1 Cr M & R 181 at 193 [149 ER 1044 at 1050]. Bell and, of course, honestly made, and these facts must, by analogy to Wright v Ramscot38, appear in the plea." The phrase "honestly made" acknowledges that malice will defeat the privilege. In the same case Barton ACJ said39: "The defendant is allowed to defend himself in the same field in which the plaintiff has assailed him – if the attack is through the press, then again the press may be used in answer: See Laughton v Bishop of Sodor and Man40. The aggressor cannot, as Mr Odgers puts it41, 'subsequently come to the Court as plaintiff, to complain that he has had the worst of the fray'. But in such cases the defendant must see to it that his retort, if vigorous, is fair; that is, that it does not go beyond the occasion." (emphasis added) The significance for the present case of what was said thereafter by Dixon J in Mowlds v Fergusson is that where the occasion is a response, by publication to the general public of defamatory matter, to a public attack upon the defendant by the plaintiff, the consideration of what is relevant to the attack requires particular care. The response must be commensurate with an occasion which is in an exceptional category. Exceptionally, the law has recognised an interest in 2GB to publish defamatory matter to the general public, which has an interest in hearing the response of the talk-back broadcaster to the public criticisms by Mr Trad of 2GB. No doubt vigorous use of language has long been a characteristic of public debate in this country. But in the conduct of public affairs the law, in general, does not encourage persuasion by public vilification and by an abdication of reason. However, by classifying its response as a "counter-attack" 2GB seeks to broaden the scope of its interest in publishing defamatory matter to its audience. The 2GB submission 2GB appeared to pitch its case at the level that "it is legitimate to go on the counter-attack" and in so doing "to impugn the general veracity of the attacker". Certainly, it has been suggested, with reference to what was said by 38 (1667) 1 Saund 84 [85 ER 93]. 39 (1913) 17 CLR 310 at 318. 40 (1872) LR 4 PC 495 at 504. 41 A Digest of the Law of Libel and Slander, 5th ed (1911) at 292. Hayne Bell Parke B in Wright v Woodgate42, that, at least initially, the function of qualified privilege was to rebut malice43. 2GB sought to develop this view of the privilege so that the significance of a reply in the excessive terms used in the imputations could only be to provide evidence from which malice might be inferred and the privilege thereby defeated; and the plea by Mr Trad of malice had failed. Some recent support for the approach by 2GB may appear from the pugilistic epithets used by the New Zealand Court of Appeal in Alexander v Clegg44 in describing the privilege as one "to hit back" by a "counterpunch" rather than "to keep one hand behind [the defendant's back]". Some further support for this view of the law was said by 2GB to be provided by statements by Latham CJ and Williams J in their joint reasons in Penton v Calwell45. However, Mr Trad correctly responded that the width of 2GB's proposition would extend the scope of the privilege too far and distort the balance indicated by pars (a) and (b) of s 3 of the 1974 Act. The law respecting qualified privilege developed, by no means systematically, in the years after the ruling by Parke B in Toogood v Spyring46. This had been in terms reflecting (but without acknowledgment) the writings of Starkie47. The subsequent course of decision in England, leading up to Adam v Ward48, has been analysed in Mr Paul Mitchell's work The Making of the Modern Law of Defamation49. The modern emphasis in the formulation of the defence is upon the existence of the relevant duties and interests rather than immediately upon the state of mind of the defendant. 42 (1835) 2 Cr M & R 573 at 577 [150 ER 244 at 246]. 43 Mitchell, "Duties, Interests, and Motives: Privileged Occasions in Defamation", (1998) 18 Oxford Journal of Legal Studies 381 at 392-393. 44 [2004] 3 NZLR 586 at 602 [61]-[63]. 45 (1945) 70 CLR 219 at 242-243; [1945] HCA 51. 46 (1834) 1 Cr M & R 181 [149 ER 1044]. 47 Starkie, A Treatise on the Law of Slander and Libel, and incidentally of Malicious Prosecutions, 2nd ed (1830) vol 1 at 292. Bell The result is that stated as follows by Cory J, speaking for the Supreme Court of Canada, in Botiuk v Toronto Free Press Publications Ltd50: "[T]he privilege is not absolute. It may be defeated in two ways. The first arises if the dominant motive for publishing is actual or express malice. Malice is commonly understood as ill will toward someone, but it also relates to any indirect motive which conflicts with the sense of duty created by the occasion. Malice may be established by showing that the defendant either knew that he was not telling the truth, or was reckless in that regard. Second, qualified privilege may be defeated if the limits of the duty or interest have been exceeded. In other words, if the information communicated was not reasonably appropriate to the legitimate purposes of the occasion, the qualified privilege will be defeated." To similar effect is the earlier statement by Jordan CJ in Mowlds v Fergusson51: "If anyone complains that the communication defames him, the burden of proof lies on the complainant to establish either that the defamatory matter was irrelevant to the purposes of the occasion or else that it was made in order to serve some other purpose than the purposes warranted by the occasion." In Skalkos v Assaf52, the New South Wales Court of Appeal emphasised that the decision of the jury in that case as to the absence of malice did not foreclose the question whether the defamatory imputations were published within the occasion of privilege. Given the distinct role of the jury at common law to determine an issue of malice, to which reference has been made above53, that result is not surprising. Finally, in Cush v Dillon54, French CJ, Crennan and Kiefel JJ observed: 50 [1995] 3 SCR 3 at 29 [79]-[80]. 51 (1939) 40 SR (NSW) 311 at 318. 52 (2002) Aust Torts Reports ¶81-644 at 68,528 [27], 68,530 [40]-[42]. 54 (2011) 243 CLR 298 at 310 [25]; [2011] HCA 30. Hayne Bell "The inquiry which precedes that of actual malice is undertaken in order to determine the boundaries of the privilege55, by reference to the duty or interest which gave rise to it. It may be said to involve an objective assessment. It is not to be confused with an inquiry as to whether a person was actuated by malice in using exaggerated words. As Earl Loreburn observed in Adam v Ward56, a statement which exceeds the occasion may be evidence of malice, but 'the two things are different'." The foundation of the privilege The statement of principle by Dixon J at first instance in Penton looks to the foundation of the privilege and should be accepted. In that case, by way of response to attacks made by the plaintiff under parliamentary privilege upon the press coverage of the escape of Japanese prisoners of war at Cowra, the newspaper, of which the defendant was editor, responded that the plaintiff was "maliciously and corruptly untruthful" and "a dishonest, calculating liar". In the action in the original jurisdiction of this Court the question was whether the form of this libel took it outside the qualified privilege claimed for the occasion, so that the plea should be struck out. This was a question on which the Court divided. What is presently of importance is that Dixon J said57: "The foundation of the privilege is the necessity of allowing the party attacked free scope to place his case before the body whose judgment the attacking party has sought to affect. In this instance, it is assumed to be the entire public. The purpose is to prevent the charges operating to his prejudice. It may be conceded that to impugn the truth of the charges contained in the attack and even the general veracity of the attacker may be a proper exercise of the privilege, if it be commensurate with the occasion. If that is a question submitted to or an argument used before the body to whom the attacker has appealed and it is done bona fide for the purpose of vindication, the law will not allow the liability of the party attacked to depend on the truth or otherwise of defamatory statements he so makes by way of defence." (emphasis added) 55 As observed by Kirby J in Bashford v Information Australia (Newsletters) Pty Ltd (2004) 218 CLR 366 at 435 [193]-[194]. 56 [1917] AC 309 at 321. 57 (1945) 70 CLR 219 at 233-234; cf Watts v Times Newspapers Ltd [1997] QB 650 Bell In this passage it is the phrase "and it is done bona fide" which indicates the distinct role of malice to defeat what otherwise would be a good plea. The phrase "be commensurate with" reflects what was said by Earl Loreburn in Adam v Ward58. Earlier, in Loveday v Sun Newspapers Ltd59 Starke J had said that the privilege is not absolute, and that the answer by the person attacked "must be relevant to the attack and must not be actuated by motives of personal spite or ill will". In Bashford v Information Australia (Newsletters) Pty Ltd60, Gleeson CJ, Hayne and Heydon JJ asked "whether the matter which defamed the appellant was sufficiently connected to the privileged occasion to attract the defence". These notions of what is "commensurate with the occasion", "relevant to the attack", and "sufficiently connected" reflect the idea captured by Parke B in Toogood v Spyring61 in the phrase "fairly warranted by any reasonable occasion or exigency". That the matter complained of is sufficiently connected to the privileged occasion to attract the defence may appear upon any one of several considerations. The matter may be sufficiently connected with the content of the attack, or it may go to the credibility of the attack, or to the credibility of the person making that attack. Questions of degree inevitably will be presented. Conclusions respecting qualified privilege Mr Trad had attacked 2GB by placing at least part of the blame for the Cronulla Riots upon the "tabloid journalism" practised by one particular talk-back radio station, namely 2GB. It was a relevant and reasonable response by 2GB to direct attention to the credibility of the attacker by imputing hypocrisy to Mr Trad as one who himself incited people to commit acts of violence and to have racist attitudes, and as one who at the peace rally had stirred up hatred against a 2GB reporter, causing him concern about his personal safety (imputations (a), (b) and (c)). 58 [1917] AC 309 at 321. 59 (1938) 59 CLR 503 at 516; [1938] HCA 28. 60 (2004) 218 CLR 366 at 378 [27]. 61 (1834) 1 Cr M & R 181 at 193 [149 ER 1044 at 1049-1050]. Hayne Bell Imputation (j) ranges more widely but is linked to par [16] of the broadcast62. In identifying Mr Trad as one who himself deliberately gives out misinformation about the Islamic community, it also seeks to undermine his credibility in complaining at the peace rally of the mistreatment of the community by 2GB. Imputations (d) and (g) are also linked by the pleading to par [16]. This text indicates that the imputations involved more than, as counsel for Mr Trad put it in this Court, 2GB "just having a crack at him". The misinformation was said to be of such a degree of seriousness as to render him a dangerous person, thus further undermining his credibility; further, it was disgraceful for Mr Trad at the peace rally to purport to represent the Islamic community in his attack upon 2GB when he had been marginalised by that community. Imputations (d) and (g) were protected by qualified privilege. Accordingly, the primary judge correctly concluded that 2GB's defence of qualified privilege applied to imputations (a), (b), (c), (d), (g) and (j). Imputation (k) is obscurely expressed. Such coherence as it does have is provided by the portion of the 2GB broadcast set out in par [24]63. The imputation seems to fix upon the relationship between Mr Trad and the media as the source of the relevant reciprocity of interest. The point then made appears to be that Mr Trad rose to prominence in Islamic community affairs by use of the facilities provided by the media, yet at the peace rally he criticised the media. Imputation (k) exceeded the occasion of the privilege. The Court of Appeal correctly decided that it was not a retort by way of vindication which was fairly With respect to imputation (h), the Court of Appeal was correct in deciding that to publish of Mr Trad that he was a pest, without more, was not a relevant response to the attack on 2GB. Counsel for Mr Trad correctly emphasised that the charge of being a pest in no way reflected on Mr Trad's credibility in making the charges against 2GB. The result is that the primary judge should have held that imputations (h) and (k) were not protected; the Court of Appeal was correct with respect to imputations (h) and (k) but erred in rejecting the defence in respect of imputation (c). 62 Set out at [7]. 63 Set out at [7]. 64 (2011) 279 ALR 183 at 209 [112]. Bell The question thus becomes whether this Court should enter upon the issue of whether the Court of Appeal erred in failing to hold that the privilege of 2GB with respect to imputations (a), (b), (c), (d), (g) and (j) nevertheless was defeated by the malice of 2GB. Malice With respect to the case presented by Mr Trad on his appeal to the Court of Appeal, that the primary judge had erred in concluding that he had not proved 2GB was actuated by malice in publishing the matter complained of, the Court of Appeal said65: "The substance of [Mr Trad's] case on malice was that [2GB] and its agent, Mr Morrison, had taken no steps to verify the situation faced by [2GB's] reporter, Mr Glasscock, before attacking [Mr Trad] and had, accordingly done so either knowing that assertion to be false or with reckless indifference to the truth or falsity of his attack. The difficulty [Mr Trad] faced was that he bore the onus of proof with respect to malice, but was not able to show precisely how Mr Morrison came to form the (incorrect) views which he expressed in the matter complained of as to the situation in which Mr Glasscock found himself at the rally, nor what steps Mr Morrison may have taken to clarify the situation. [Mr Trad] relied solely upon the fact that the videotape of the rally did not support claims of aggression towards Mr Glasscock and that Mr Morrison said that he had viewed the video. Factually, those two statements were true, but they were not sufficient to demonstrate that Mr Morrison knew what he said to be false or made his statements with reckless indifference to the truth or falsity of his attack." Against that holding by the Court of Appeal, Mr Trad seeks an extension of time to file an application for special leave to cross-appeal. 2GB correctly responds that leave ordinarily will be refused if, were leave to file granted, there would be no grant of special leave. The grounds of the proposed cross-appeal deal both with the extension sought of Mr Trad's success on the qualified privilege question, and with malice (ground 2(f)). Mr Trad also seeks an extension of time to file a notice of contention. The proposed notice would raise an issue respecting the truth defences and the issue 65 (2011) 279 ALR 183 at 209 [115]-[116]. Hayne Bell that "the whole of the qualified privilege defence should have been rejected because of malice". Insofar as the issue of malice is concerned, this goes beyond the scope of r 42.08.5 of the High Court Rules 2004, which deals with notices of contention in this Court. These notices may be given only by a respondent who "does not seek a discharge or variation of a part of the judgment actually pronounced or made". But this respondent seeks to do so. The Court of Appeal rejected part, not the whole, of the qualified privilege defence, and ordered remitter for assessment of the damages in relation to three of the eight imputations. The proposed notice of contention would be incompetent insofar as it seeks to deal with the issue of malice and an extension of time to that extent should be refused. (The question of the truth defences will be considered later in these reasons.) The issue respecting malice which Mr Trad wishes to press in this Court is encompassed not by r 42.08.5, but by the proposed cross-appeal in ground 2(f), by which he seeks the setting aside of the Court of Appeal orders so as to achieve a remitter for the assessment of damages on all imputations. One ground on which this outcome is sought is that the Court of Appeal should have found that Mr Trad "had established that the reply by the employee was actuated by malice" (ground 2(f)). Leave to file the notice of cross-appeal out of time should be granted, but with the excision of ground 2(f). There would be insufficient prospects of success in demonstrating error by the Court of Appeal in its conclusions in the passage set out above to warrant a grant of special leave on proposed ground 2(f), and no ground of general importance is involved here. Mr Trad sought to bolster his case for a grant of special leave on the issue of malice by directing attention to the state of mind of Mr Glasscock. He, like Mr Morrison, was an employee of 2GB. It was said that the issue of Mr Glasscock's malice, for which his employer was vicariously liable, had been run at trial. The best passage in support was identified as one in the closing submissions by counsel then appearing for Mr Trad. This falls short of sufficient indication that the focus of the case at trial was on Mr Glasscock rather than Mr Morrison to warrant entry by this Court upon this matter. This particularly is so given the absence of agitation of the point by Mr Trad in the Court of Appeal. Truth There remains the treatment by the Court of Appeal of the defences of substantial truth (s 15) and contextual truth (s 16). Bell The Court of Appeal held66 that the primary judge had erred in not asking the question "whether, given the attitudes and views he found [Mr Trad] held, a right-thinking member of the Australian community would consider" that he incites people to commit acts of violence, and to have racist attitudes, is a dangerous individual, and is a disgraceful individual (imputations (b), (c), (d) and (g)). Having found error in principle by the primary judge, the Court of Appeal, however, did not go on to apply what it saw as correct principles so as to produce a definitive result. Hence 2GB seeks remitter to the Court of Appeal for this to take place. For his part, in the Court of Appeal, Mr Trad had (1) challenged, as a matter of law, the invocation of the "right-thinking" person, and (2) disputed the factual findings upon which the primary judge had held that imputations (b), (c), (d) and (g) were substantially true and related to a matter of public interest (s 15). By his proposed notice of contention, Mr Trad seeks to support the reversal by the Court of Appeal of the primary judge's decision on the truth defences but on the ground "that the general community standard test was irrelevant to [the determination] of the truth defences". An extension of time to file a notice of contention limited to that complaint should be granted to Mr Trad. For its part, 2GB submits that the Court of Appeal was correct in its identification of the right-thinking community member test, but erred in holding that the primary judge had not applied it and, on remitter from this Court, itself should apply it. The invocation of "right-thinking" persons as a criterion of the defamatory nature of the matter in question was doubted by Griffith CJ in Slatyer v The Daily Telegraph Newspaper Co Ltd67 if it identified anything other than "a man of fair average intelligence". More recently, in Radio 2UE Sydney Pty Ltd v Chesterton68, French CJ, Gummow, Kiefel and Bell JJ disfavoured any additional requirement of "right-thinking" and preferred, as the referee of the issue of whether a person had been defamed, an audience composed of ordinary decent persons, being reasonable people of ordinary intelligence, experience and education who brought to the question their general knowledge and experience of worldly affairs. Their Honours added that such a criterion "may be seen as a 66 (2011) 279 ALR 183 at 202 [79], [81], 203 [84], [86]. 67 (1908) 6 CLR 1 at 7; [1908] HCA 22. 68 (2009) 238 CLR 460 at 466-467 [4]-[6], 477-478 [39]-[40]; [2009] HCA 16. Hayne Bell benchmark by which some views would be excluded from consideration as unacceptable"69. A legislative objective of the procedures under s 7A of the 1974 Act was to overcome the complexities said to arise from the common law division of functions between judge and jury70. Chesterton concerned the alleged inadequacy of jury directions at the second stage, under s 7A(3), when the jury determined whether the matter complained of carried the imputations and, if so, whether they were defamatory. Under s 7A(4) McClellan CJ at CL alone was required to determine all issues of fact and law relating to 2GB's defences. Issues of fact upon which a defence of substantial truth turns may present a ready choice for decision by the judge sitting, as did McClellan CJ at CL, at the s 7A(4) stage. But in other cases the imputation may depend upon more than primary fact finding. Upon that factual substratum an assessment of an evaluative nature may be required by the terms in which the imputation is expressed. Imputation (g) is of that character. In such a case the judge should look to the reaction of an audience composed in the manner as described above by reference to Chesterton. This is not how the primary judge proceeded, nor, having found error by the primary judge, did the Court of Appeal proceed in this way in the determination of imputation (g). Moreover, as 2GB submits, the Court of Appeal misconceived the primary judge's approach to imputations (b), (c) and (d). His Honour's consideration of the application of a test based on community standards was confined to the substantial truth of imputation (g). The findings by McClellan CJ at CL respecting the views held by Mr Trad on the topics of women victims of sexual violence, homosexuals, Jews, child martyrs, terrorism, Anglo-Irish Australians and Hindus informed his conclusion of the substantial truth of imputations (b), (c) and (d). His Honour found that the communication of Mr Trad's views demonstrated the substantial truth of the imputation that he incites people to commit acts of violence (imputation (b)) and that he is a dangerous individual (imputation (d)). He found that Mr Trad's encouragement of others to share his views demonstrated the substantial truth of the racist attitudes imputation (imputation (c)). incites people that Mr Trad to have 69 (2009) 238 CLR 460 at 478 [40]. 70 John Fairfax Publications Pty Ltd v Gacic (2007) 230 CLR 291 at 303-304 [33]. Bell In the Court of Appeal Mr Trad challenged the factual basis of the findings by McClellan CJ at CL (grounds 4 to 9). His appeal respecting the adverse truth findings succeeded on a ground not taken by him, that McClellan CJ at CL had proceeded on "a false basis"71. In the absence of a notice of contention by 2GB seeking to uphold the findings on any different basis, the Court of Appeal found it unnecessary to address the parties' submissions as to the factual basis for them72. 2GB has succeeded in its appeal against the setting aside of the primary judge's findings of substantial truth. In the result, it will be necessary for the Court of Appeal to reconsider so much of the appeal by Mr Trad as challenged the holding of the primary judge upon the defences under s 15 and s 16. There was no cross-appeal by 2GB to the Court of Appeal with respect to the rejection by the primary judge of the defence of substantial truth to imputation (h), that Mr Trad is widely perceived as a pest, or imputation (j), that Mr Trad deliberately gives out misinformation about the Islamic community. (His Honour, however, held that, because imputations (b), (c), (d) and (g) were substantially true, the publication of imputations (a), (h), (j) and (k) did not occasion further injury to Mr Trad's reputation73.) 2GB relies, in its appeal to this Court, on the ground that the Court of Appeal erred in holding that imputation (h) was not protected by qualified privilege. But, as appears above74, the Court of Appeal was correct in this respect. Conclusions and orders Upon his summons filed 28 October 2011 Mr Trad should have an extension of time until 14 days hereafter to file (a) a notice of contention limited to the truth defences as indicated in the draft notice and (b) a notice of cross-appeal limited to grounds 2(a)-(e) in the draft notice. There should be a grant nunc pro tunc of special leave to cross-appeal upon those grounds 2(a)-(e). But the cross-appeal, which seeks a result that no imputation is protected by qualified privilege, should be dismissed. 71 (2011) 279 ALR 183 at 203 [87]. 72 (2011) 279 ALR 183 at 203 [87]. 73 See [13]. 74 See [41]. Hayne Bell The appeal by 2GB should be allowed. The orders of the Court of Appeal made on 22 March 2011 should be set aside. The appeal to that Court should be allowed and the orders made by McClellan CJ at CL on 6 August 2009 set aside. There should be a declaration that the defence of qualified privilege at common law with respect to imputations (a), (b), (c), (d), (g) and (j) is made good. There should be remitted for consideration by the Court of Appeal in the light of the reasons of this Court: the defences of substantial truth with respect to imputations (b), (c), (d) and (g) and contextual truth with respect to imputations (h) and (k); any questions of remitter to the Common Law Division for assessment of damages if the Court of Appeal holds that a defence of contextual truth does not apply to imputations (h) and (k); all questions of costs of proceedings in the Common Law Division and the Court of Appeal. In this Court there should be no costs orders on either the appeal or the cross-appeal. Each side has had some, but limited, success in this Court. HEYDON J. The background facts are set out in other judgments. Qualified privilege and malice Much of the argument turned upon whether the appellant could successfully raise the defence of qualified privilege. The respondent seeks to defeat that defence by contending that the appellant acted with malice. The appellant submits that so far as the notice of contention raises malice in relation to some imputations, it should be dismissed. The appellant also submits that there should be no grant of special leave to appeal on malice in relation to the remaining imputations. One reason advanced for the appellant's submission is that the respondent "ha[d] lost at every stage of the litigation" on the malice issue. This was not a claim that this Court should not substitute its own view for concurrent findings by the trial judge and the Court of Appeal. No claim of that kind could credibly have been made. The reasoning of the trial judge and the reasoning of the Court of Appeal were not identical or in any sense concurrent. And even if the reasoning had been, that would not in itself have been a bar to success. The respondent submitted that neither the trial judge nor the Court of Appeal had "given due consideration" to malice. Perhaps because of the multiplicity of other issues with which the parties belaboured the trial judge and the Court of Appeal, that was, with respect, a submission that had some force. The malice issue arose as follows. Imputation (a) in par 3 of the respondent's amended statement of claim was: "The [respondent] stirred up hatred against a 2GB reporter [Mr Chris Glasscock] which caused him to have concerns about his own personal safety." The imputation flowed from statements made in a broadcast on the appellant's radio station by Mr Morrison, the appellant's employee. Those statements concerned a "peace rally" which Mr Glasscock reported on, and at which the respondent gave an address. In par 2 of his reply, the respondent pleaded: "Further in reply to the defence of qualified privilege … the [respondent] says the [appellant] was actuated by express malice in the publication of the matter complained of. Particulars (a) Wrongful failure to make proper enquiries before publication of the imputations in the matter complained of. False and/or misleading particulars of truth and contextual truth insofar as they apply to [imputation (a) and other imputations]." Particular (b) of par 2 of the reply refers to pars 6 and 7(a) of the appellant's amended defence. Paragraph 6 of the appellant's amended defence pleaded that imputation (a) was a matter of substantial truth. And par 7(a) of the amended defence repeated imputation (a), with six other imputations75. They were said to be contextual imputations which were substantially true. If imputation (a) is false, the appellant's plea that it was a matter of substantial truth was also false. On 15 May 2009, three days before the trial began, the respondent's solicitors wrote to the appellant's solicitors a letter stating: "We refer to the Reply herein and advise that the [respondent] proposes to add to the Particulars of Malice the following paragraph; 'The [appellant] by itself, its servant and agent Jason Morrison spoke and published of and concerning the [respondent] the words set out in annexure "A" of the Amended Statement of Claim including words relating to the intimidation of and misconduct towards Chris Glasscock which said words the [appellant], its servant and agent Jason Morrison either knew to be false or were spoken with reckless indifference to their truth or falsity.'" At the trial, the appellant did not seek to justify imputation (a). The trial judge found it to be false. That finding was inevitable. The respondent denied the imputation in chief. He was not cross-examined to suggest that this testimony was false. The appellant did not call Mr Morrison to support imputation (a). Nor did the appellant call Mr Glasscock, who, according to Mr Morrison's broadcast, spoke to Mr Morrison while covering the peace rally. After contrary submissions, at the very end of this appeal the appellant admitted that Mr Glasscock was one of its employees. An inference is to be drawn that the evidence of Mr Morrison and Mr Glasscock could not have assisted the appellant. An inference is also to be drawn that at least Mr Glasscock, who attended the peace rally, knew at all material times, particularly the time of the broadcast, that imputation (a) was false. The appellant submitted that inferences could not be drawn against it on an issue on which it did not bear the burden of proof. However, an inference adverse to the appellant can be drawn if there exists some evidence against the appellant. That condition is satisfied. The terms of Mr Morrison's broadcast, taken with a key admission by the appellant, contain a considerable amount of material supporting an inference that, if Mr Morrison correctly described what Mr Glasscock said to him, Mr Glasscock knew that what he said to Mr Morrison was false. The appellant's failure to call Mr Glasscock supports that inference. 75 See above at [7]. The appellant also submitted that whether or not it pressed a defence of justification at trial is "wholly irrelevant" to the question of malice at the time of the broadcast. That is not so. The decision to abandon a solemnly pleaded specific defence without satisfactory explanation can be significant. It can be particularly significant where it positively makes so serious an allegation as that the respondent "stirred up hatred against [Mr Glasscock] which caused him to have concerns about his own personal safety"76. And it can be particularly significant where the appellant had already admitted to the respondent on 3 May 2006 that imputation (a) was false77. The respondent submitted that the appellant's statements were malicious because Mr Glasscock knew that it was untrue for Mr Morrison to say that Mr Glasscock feared for his own safety during the respondent's speech at the peace rally. If a defendant knows a statement is untrue at the time of its making, this is "almost invariably conclusive evidence of malice."78 The relevant statements are those of Mr Morrison about what happened at the peace rally at the time when the respondent was addressing it. Some of the parts of the broadcast which support malice are as follows. Mr Morrison said that during the peace rally Mr Glasscock had called. He continued: "The phone call I got from him was one of fear because half way through this peace rally things turned very hostile and hostile against this radio station but also towards Chris himself." Further, Mr Morrison said: "Chris Glasscock our reporter down there called to say that he had significant concerns about his own personal safety because [the respondent] had turned his little moment of peace into a hate 2GB rally." A little later on Mr Morrison claimed: "it didn't take [the respondent] long at this rally to point the finger again at us. But I gotta say it wasn't just at us, he started to point out our reporter in the crowd [ie Mr Glasscock] … [T]here was [the respondent] pointing out the 2GB reporter and pointing out the microphone in the crowd and highlighting that it's these people, pointing at 2GB, these people stirring up the hatred." Mr Morrison then played a recording, in part, of what the respondent said at the rally. Before he did so, Mr Morrison said: "Now the audio on this is not brilliant because [Mr Glasscock] had to retreat, so we only have, you know, long shot audio recording". When the broadcast of the respondent's speech stopped, Mr Morrison said: "Now I'm sorry about the quality of that, but as I said [Mr Glasscock] our reporter there had to pull back because it wasn't safe for 76 See Clerk and Lindsell on Torts, 20th ed (2010) at 1553 [22-214]. 77 See below at [75]. 78 Roberts v Bass (2002) 212 CLR 1 at 32 [77] per Gaudron, McHugh and Gummow JJ; [2002] HCA 57. him to be standing at the front while all this was going on." Finally, Mr Morrison addressed the respondent. He said: "don't take it out on a young reporter on his own in a crowd of people that you're whipping up." In significant measure, what Mr Morrison said was untrue. The respondent did not gesture or point at Mr Glasscock. Mr Glasscock did not "retreat" or "pull back". On 3 May 2006, the Chief Operating Officer of the radio station admitted in a letter to the respondent: "It is clear from the footage that the information given to Mr Morrison [by Mr Glasscock] was incorrect at the time of the rally, and that you did not gesture towards our reporter during your speech, nor did he retreat from the stage during your speech." The letter went on: "I have spoken to Mr Morrison about this misinformation, and we have agreed that when he is next on air (during June) he will clarify this error." That was not technically a formal admission. But in substance it served the same function. It had the same reliability. At the trial, counsel for the appellant accepted that Mr Glasscock did not retreat while the respondent was addressing the rally. It is clear that the source of the respondent gestured or pointed at Mr Glasscock and that Mr Glasscock retreated or pulled back was Mr Glasscock. information that In considering whether the appellant knew that what it was saying about the respondent gesturing or pointing and Mr Glasscock retreating or pulling back was untrue, the relevant human minds are those of Mr Morrison and Mr Glasscock. If Mr Morrison did not know that what he was saying was untrue, but was correctly describing what Mr Glasscock said to him, there is no doubt that Mr Glasscock did know that what he said to Mr Morrison was untrue. In his closing address to the trial judge, junior counsel for the respondent submitted that the suggestion that Mr Glasscock pulled back "is all nonsense and Mr Glasscock knew it was untrue." He submitted: "Mr Morrison is given these deliberately false statements, knowingly false statements by Mr Glasscock presumably knowing they would be repeated on air, which they were." "The plaintiff pleaded malice on behalf of the defendant, alleging that the defendant failed to make proper enquiries before publication. The plaintiff also pleaded that the defendant had pleaded false and misleading particulars of truth. In addition, the plaintiff alleged that the defendant knew the words in the broadcast 'including words relating to the 79 Trad v Harbour Radio Pty Ltd [2009] NSWSC 750 at [145]-[146]. intimidation and misconduct towards Chris Glasscock' were false or that it was recklessly indifferent to the truth or falsity of those words. As the defendant emphasised in submissions the plaintiff led no evidence in support of these matters. However, there was evidence from the visual recording of the plaintiff's speech that the 2GB reporter remained in position in front of the plaintiff during his speech. There was no gesture made by the plaintiff towards him. Nevertheless, the obvious hostility of the crowd towards 2GB and the prominence of the reporter who was holding a microphone which identified him as from 2GB would undoubtedly have made him feel uncomfortable and vulnerable. In these circumstances Mr Morrison may have legitimately but erroneously come to the conclusion that Mr Glasscock, feeling threatened, had withdrawn from a prominent position. Ultimately there is no evidence from which I could conclude that Mr Morrison as opposed to Mr Glasscock knew that his remarks on air were false. Even if Mr Morrison knew that this allegation which he broadcast was false I am not persuaded that the dominant purpose of the defendant in making the broadcast was improper." The key reasoning is in the last three sentences. The possibility raised in the third last sentence must be rejected. Mr Morrison stated that Mr Glasscock's phone call "was one of fear". He stated that the respondent "started to point out" Mr Glasscock in the crowd. He stated that Mr Glasscock had "significant concerns about his own personal safety" because of the respondent's behaviour. And Mr Morrison stated that Mr Glasscock had to retreat, and that he had to pull back. This contradicted the possibility that it was Mr Morrison's unassisted idea that Mr Glasscock had retreated or pulled back. When the transcript of the broadcast is read as a whole, the conclusion stated by Mr Morrison that Mr Glasscock had withdrawn does not appear to be based on any personal inference by Mr Morrison from circumstances such as the hostility of the crowd. Its detailed circumstantial character – gesturing, pointing, retreating, pulling back – can only have been based on what Mr Glasscock told Mr Morrison. Mr Morrison passed on what Mr Glasscock told him. Mr Morrison apparently endeavoured to support the verisimilitude of what Mr Glasscock told him by twice attributing the poor quality of the recording of the respondent's speech to Mr Glasscock's retreat from the respondent. The last two sentences in the passage just quoted from the reasons for judgment of the learned trial judge are immaterial. It is sufficient that Mr Glasscock knew the material which he supplied to Mr Morrison was not true. The Court of Appeal criticised these two sentences. But it said that its criticisms did "not undermine the finding of fact, namely, that Mr Morrison, believing that what he said was true, had not been shown to have acted with malice." Earlier, the Court of Appeal said80: "The substance of the [respondent's] case on malice was that the [appellant] and its agent, Mr Morrison, had taken no steps to verify the situation faced by the [appellant's] reporter, Mr Glasscock, before attacking the [respondent] and had, accordingly done so either knowing that assertion to be false or with reckless indifference to the truth or falsity of his attack. The difficulty the [respondent] faced was that he bore the onus of proof with respect to malice, but was not able to show precisely how Mr Morrison came to form the (incorrect) views which he expressed in the matter complained of as to the situation in which Mr Glasscock found himself at the rally, nor what steps Mr Morrison may have taken to clarify the situation. The [respondent] relied solely upon the fact that the videotape of the rally did not support claims of aggression towards Mr Glasscock and that Mr Morrison said that he had viewed the video. Factually, those two statements were true, but they were not sufficient to demonstrate that Mr Morrison knew what he said to be false or made his statements with reckless indifference to the truth or falsity of his attack." In fact, it was not clear that the video which Mr Morrison viewed had included a recording of the respondent's speech. That qualification aside, the answer to the Court of Appeal's reasoning is that the inquiry is not limited to Mr Morrison's state of mind. It is an inquiry into the corporate state of mind of the appellant, and that mind is the combination of Mr Morrison's and Mr Glasscock's minds. In this Court, the appellant contended that malice on its part resting on Mr Glasscock's state of mind had not been pleaded. That is true, in the sense that the respondent particularised Mr Morrison's malicious state of mind, not Mr Glasscock's. The appellant therefore relies on the principle in Suttor v Gundowda Pty Ltd81 that: "[w]here a point is not taken in the court below and evidence could have been given there which by any possibility could have prevented the point from succeeding, it cannot be taken afterwards." The appellant submitted that "the evidence … does not establish … that [Mr Glasscock] was actuated by malice." That submission is incorrect for the reasons given above82. Was there any evidence which could have been called at trial which by any possibility could have defeated the respondent's argument on 80 Trad v Harbour Radio Pty Ltd (2011) 279 ALR 183 at 209 [115]-[116]. 81 (1950) 81 CLR 418 at 438; [1950] HCA 35. 82 See above at [73]-[75]. malice? It must be remembered that what the respondent had to establish was the appellant's malice. It must also be remembered that if the appellant knew that its statements were untrue when they were made, malice is probably established. Either Mr Glasscock had retreated because of a gesture by the respondent, or he had not. The evidence, particularly the appellant's admission in the letter from the Chief Operating Officer, is that he had not. Once it is accepted that Mr Glasscock had not retreated because of a gesture by the respondent, and that Mr Glasscock had falsely told Mr Morrison that he had, no evidence from Mr Glasscock could have altered the conclusion that Mr Glasscock knew that he had told Mr Morrison something untrue. Mr Glasscock was the only possible source of the "information given to Mr Morrison … at the time of the rally" which the Chief Operating Officer's letter described as "incorrect". It was not possible that Mr Glasscock could have been innocently mistaken. The appellant submitted that the case had never ceased to be the one which was run on the pleadings. "All the evidence that was admitted was relevant to the case particularised about [Mr] Morrison's state of mind. The fact that counsel for [the respondent] made a glancing reference to 'the knowledge of Mr Glasscock' … in address, after the evidence was closed, does not turn this into a Leotta. The address on behalf of the appellant at AB334.42-48 shows that, consistently with the pleadings, the appellant was proceeding on the basis that 'the relevant state of mind … is that of the person who does the act' of publication alleged, namely, [Mr] Morrison. See also at AB340.20. Evidence of [Mr] Glasscock's state of mind was relevant on the pleadings to the extent that it might support an inference about [Mr] Morrison's state of mind. But [Mr] Glasscock's state of mind was not independently relevant to malice in its own right."83 These submissions must be rejected. First, the evidence in the form of the admission contained in the Chief Operating Officer's letter of 3 May 2006 cannot have been relevant only to Mr Morrison's state of mind. He was not at the rally. Mr Glasscock was. Secondly, it is not correct to describe the address of counsel for the respondent as containing only a "glancing reference" to Mr Glasscock's knowledge. Counsel said: "We have two employees of 2GB, neither of them giving evidence, with an inference that both of them put their heads together to 83 The reference to "a Leotta" is to Leotta v Public Transport Commission (NSW) (1976) 50 ALJR 666; 9 ALR 437. cook up allegations against the plaintiff to justify all those eight terrible imputations." He continued: "This is a reply to a nonexistent attack we say cooked up between Mr Glasscock and Mr Morrison, or as a result of Mr [Glasscock], a 2GB employee, giving Mr Morrison (as said) led Mr Morrison, which triggered him off into a diatribe against the plaintiff. Either way Mr Glasscock is an employee of 2GB, must accept some of the responsibility if not the whole of the responsibility for this broadcast by Mr Morrison". information which And he said: "All they have done is attack [the respondent's] integrity because of the false allegations that he put Mr Glasscock in fear of his life." This part of counsel's address was interspersed with questions from the trial judge about what he was to do with the fact that either Mr Glasscock or Mr Morrison "got it wrong." The following exchanges are also relevant: "HIS HONOUR: Your point is you don't have to prove which one of them was telling untruths, one of them must be. [COUNSEL FOR THE RESPONDENT]: Well, one or both. HIS HONOUR: Yes, that's your point. HIS HONOUR: Well, put shortly, your point is that 2GB didn't set out to correct the impression as to what it may or may not have been doing relevant to the Cronulla riots, rather, it set out to attack the plaintiff saying – you say wrongly – that he stirred up the crowd against Mr Glasscock. [COUNSEL FOR THE RESPONDENT]: That's it in a nutshell, your Honour. HIS HONOUR: That's the way you put it. [COUNSEL FOR THE RESPONDENT]: Yes, your Honour. HIS HONOUR: And whether it, I suppose, expresses the occasion or expressed as malice, you say you win on either count – [COUNSEL FOR THE RESPONDENT]: Correct. HIS HONOUR: – on that issue?" Counsel for the appellant addressed the trial judge in reply on the question of malice over 12 pages of the transcript. He did not submit that Mr Glasscock's state of mind was irrelevant to the question of the appellant's malice. He did advance various arguments for the view that neither Mr Glasscock nor Mr Morrison were actuated by malice. He also denied that Mr Glasscock was "the responsible state of mind, or a part of the responsible state of mind" of the appellant. But he never submitted that an inquiry into that question was not open on the pleadings, or that the respondent was changing his case and should not be permitted to do so after the evidence had closed. The appellant referred to two pieces of transcript in the passage from his submissions to this Court quoted above84. The first was: "[COUNSEL FOR THE APPELLANT]: Well, he says something, apparently. He conveys some information to Mr Morrison. But the relevant state of mind, your Honour, is that of the person who does the act, because – and this is the crucial point – HIS HONOUR: That is true, but that mind is informed by Mr Glasscock. [COUNSEL FOR THE APPELLANT]: The question is one of motive and purpose. That's my – that's the fundamental proposition. It's the motive or purpose of the person who does the publication." That was a submission – and there were others to that effect during the reply – that Mr Morrison's state of mind was the only state of mind that could be material in law. It was not a submission that on the pleadings Mr Morrison's was the only relevant state of mind. The other passage to which the appellant referred concerns exhibit B, the letter of 3 May 2006 from the Chief Operating Officer to the respondent. The submission was: "this was information given to Mr Morrison and so far as the evidence in this document touched upon Mr Morrison's state of mind at all it really exculpates Mr Morrison. That is why I took your Honour to the authority dealing with the question of whose state of mind it is. So, the proposition is [Mr] Morrison is the actuating relevant mind and there is no suggestion in this that he was acting on anything other than the information that he had such as he understood it. That is exhibit B." The authority referred to was Palmer v John Fairfax & Sons Ltd85. Hunt J there said: 84 See above at [82]. 85 (1986) 5 NSWLR 727 at 733. "As a corporation, the defendant has no mind of its own, and its state of mind must be found in the mind of those persons who did the act for which it is sought to be made responsible." The proposition does not support the appellant's case. Mr Morrison's statement was an act for which both Mr Morrison and Mr Glasscock were responsible. However, the present point is simply that counsel was making a submission about the law, not complaining about departure from the pleadings. Finally, the appellant submitted that evidence of Mr Glasscock's state of mind was relevant on the pleadings only to the extent that it might support an inference about Mr Morrison's state of mind. It is difficult to see how it was relevant except as being an ingredient in the appellant's state of mind. It was relevant to the substantive allegation in par 2 of the respondent's reply, even if it was irrelevant as being outside the three particulars given in that paragraph86. But no complaint about that kind of irrelevance was made at the trial. Rather, the appellant confronted the problem on its merits. The appellant cited Brennan J's approval in Stephens v West Australian Newspapers Ltd87 of Egger v Viscount Chelmsford88. But those cases did not involve an inquiry into which two employees caused a single defendant to have a malicious state of mind. They were directed to the state of affairs as between two defendants. The liability of each defendant depended upon that defendant's own state of mind, unaffected by the malice of any other defendant. The appellant's submission treats Mr Morrison as a defendant and Mr Glasscock as a potential defendant. Neither was in fact a defendant. The only defendant was the appellant. The only determinative state of mind was that of the appellant. The issue concerns which human minds that state of mind is to be found in. That precise point was not explicitly considered in any of the few cases cited by the parties. Did Mr Glasscock's knowledge of the falsity of what he said to Mr Morrison and therefore of what Mr Morrison said cause the appellant's state of mind to be malicious? It did. In determining the corporate state of mind of the appellant, it is necessary to take into account the state of mind of the relevant employees – the first employee who broadcast the propositions in question and the second employee who informed the first employee of those propositions. The second employee knew the propositions were incorrect and knew it was likely that the 86 See above at [68]. 87 (1994) 182 CLR 211 at 254-255; [1994] HCA 45. first employee would use them in broadcasting about the peace rally. In that regard the appellant submitted: "Mr Morrison in the broadcast says he had had some conversation of the day with Mr Glasscock. He does not say, 'Mr Glasscock told me to publish this' or anything of the kind, and although Mr Glasscock is a reporter, undoubtedly it is not at all clear that he understood that he was going to be saying something to Mr Morrison, which Mr Morrison would then be publishing in this respect." Yet it is almost inevitable that when one radio journalist employed to work for a radio station says something newsworthy to another radio journalist who is employed to work for the same station and who is to deliver a broadcast about a strikingly interesting event like the peace rally, what the first says will in fact be broadcast by the latter. The first employee knew that the propositions he was communicating were seriously damaging propositions. Since he was advancing them as part of a counter-attack, it may be inferred that he intended them to be seriously damaging. His broadcast took place on the day following the peace rally. That allowed an interval in which the first employee could have checked the accuracy of what the second employee had told him in the heat of the peace rally, given it cool reflection, and analysed its correctness closely with the second employee with a view to ensuring that there was not some error in perception or transmission. Taking the states of mind of the two employees together with their behaviour in relation to the likely broadcasting of what the second had said to the first, the conduct of the appellant in broadcasting the propositions was malicious. That is because it was at least reckless as to the truth or falsity of the propositions. In short, there are two possibilities. One possibility is that Mr Morrison falsely told his audience that Mr Glasscock had complained that he had been put in fear, and retreated, because the respondent gestured at him: if so, Mr Morrison's state of mind was malicious and the appellant is fixed with it. The other possibility is that Mr Morrison truthfully told his audience that Mr Glasscock had complained that he had been put in fear, and retreated, because the respondent gestured at him: if so, the admission by the Chief Operating Officer proved that what Mr Glasscock said was false, and it must have been false to his knowledge. For the above reasons, that fixed the appellant with malice. Accordingly, leave to file ground 2(f) of the notice of cross-appeal should be granted. The cross-appeal should be allowed on that point. In consequence, the defence of qualified privilege must fail. Substantial truth and contextual truth issues The trial judge applied a "right-thinking member of the Australian community" test to imputations (b), (c), (d) and (g). He concluded on that basis that those imputations were substantially true. The trial judge also concluded that they had the effect that the publication of imputations (a), (h), (j) and (k) did not occasion further injury to the respondent's reputation. That is, the "findings that the plaintiff incites acts of violence, incites racial attitudes, is dangerous and perhaps most significantly is a disgraceful individual occasion such injury that the other imputations are incapable of causing further injury."89 The Court of Appeal considered that the trial judge had not applied the selected test correctly. In its view, the correct question in relation to imputation (b), for example, was "whether, given the attitudes and views properly found to be held by the [respondent], a right-thinking member of the Australian community would consider that the [respondent] incites people to commit acts of violence."90 The Court of Appeal concluded that the trial judge's test caused his findings of substantial truth to proceed "on a false basis". It said that those findings "cannot be sustained."91 The Court of Appeal did not itself apply what it thought to be the correct question to the problem. In this Court, the appellant relied on ground 6 of the notice of appeal. It stated: "The Court of Appeal erred: in holding that, notwithstanding that the learned trial judge had identified the correct test as to the substantial truth of imputations (b), (c), (d) and (g) (namely, the views of right-thinking members of the Australian community generally), his Honour failed to apply that test (or to apply it 'in those terms'), such that 'the findings of substantial truth proceeded on a false basis and cannot be sustained'; in failing to make its own findings in respect of the defences of truth and contextual truth." The third order sought was: "In the event that the appeal is allowed only in respect of ground 6, the orders of the Court of Appeal made on 22 March 2011 be set aside and the matter be remitted to the Court of Appeal for determination of the defences of truth and contextual truth." 89 Trad v Harbour Radio Pty Ltd [2009] NSWSC 750 at [129]. 90 Trad v Harbour Radio Pty Ltd (2011) 279 ALR 183 at 202 [79]. 91 Trad v Harbour Radio Pty Ltd (2011) 279 ALR 183 at 203 [87], referring to 200 In its written submissions, the appellant put the following submission in support of ground 6: "The Court of Appeal agreed that the general community standards test adopted by the trial judge was the correct test. However, despite the absence of any ground of appeal, submissions or even discussion at the hearing on this issue, the Court of Appeal held that the trial judge did not in fact apply that test. This conclusion appears to have been based on the failure of the trial judge, on each occasion he was dealing with a factual matter, to recite the test word for word and then mechanically posit an answer." (footnotes omitted) The second sentence makes a serious allegation. However, it is not necessary to investigate its merits. In relation to imputation (g) – that the respondent "is a disgraceful individual" – counsel for the respondent more than once challenged the appellant to state what conduct the respondent had been guilty of which made it substantially true to call him "a disgraceful individual". The appellant did not say. The appellant did point to a large number of opinions which the respondent was said to hold and which many people might very strongly disagree with. But that does not ipso facto establish that the respondent is a disgraceful individual. Nor, despite a similar challenge, did the appellant say what particular acts merited the respondent being called someone who incited people to commit acts of violence (imputation (b)), who incited people to have racist attitudes (imputation (c)), or who was dangerous (imputation (d)). The respondent submitted that the Court has power to decline to remit proceedings to the Court of Appeal. The respondent also submitted that in view of the appellant's failure to provide a satisfactory basis on which the Court of Appeal could work, even assuming in the appellant's favour that the Court of Appeal erred in some way, the power to remit ought not to be exercised. Those submissions should be accepted. The respondent pointed out that whatever damages the respondent eventually gets, if any, will have been nibbled down to nothing by the expense of this futile litigation. It is time to bring it to a halt. But at least one more stage cannot be avoided – the assessment of damages. Orders The appeal should be dismissed with costs. Special leave to appeal should be granted on par 2(f) of the notice of cross-appeal, and the cross-appeal should be allowed on that ground with costs. In lieu of the Court of Appeal's orders, there should be orders that the whole of the respondent's appeal to that Court be upheld with costs, that the proceedings be remitted to the Common Law Division for the assessment of damages in relation to imputations (a), (b), (c), (d), (g), (h), (j) and (k), and that the order as to the costs of the first trial in the Common Law Division be determined by the judge who assesses the quantum of damages. KIEFEL J. This appeal concerns a broadcast by the appellant's radio station, Radio Station 2GB, on 19 December 2005 during which the host, Jason Morrison, made statements defamatory of the respondent, Keysar Trad. On the day prior to the broadcast, Mr Trad had addressed an event in Hyde Park, Sydney, which was promoted as a "peace rally" and was intended to counter the effects of events known as "the Cronulla riots", which had occurred some days previously. The trial judge in the Supreme Court of New South Wales, McClellan CJ at CL, observed that the riots "were perceived by many people as a confrontation between adherents to the Muslim faith and persons of Caucasian heritage."92 Mr Trad was one of a number of speakers at the rally and several persons from the media were present, including a reporter from 2GB. During Mr Trad's address he made some attacks upon 2GB. What was said by Mr Morrison on air on 19 December 2005 concerning Mr Trad was a response to that attack. Mr Trad brought an action for defamation against the appellant (which I shall refer to as "2GB"). 2GB defended the action on the basis that the defamatory statements were made on an occasion of qualified privilege and were therefore protected at common law. Such a defence is preserved by the Defamation Act 1974 (NSW)93 ("the 1974 Act"). 2GB also relied upon the defences of substantial and contextual truth which are provided by ss 15 and 16, respectively, of that Act. The attack and the response A transcript of Mr Trad's speech, which included interjections made by members of the crowd gathered at the rally, was tendered at trial. Although he did not explicitly refer to "the Cronulla riots", Mr Trad alluded to those riots early in his address. He accused "those racist rednecks in tabloid journalism" of mustering "5000 people filled with hatred" for the purposes of the riots. It is evident from the opening and concluding words of his address that Mr Trad considered the federal government and certain segments of the media to be responsible for the riots. He and the crowd identified 2GB as a "mouthpiece" of the government. He accused 2GB of "whipping up fears" and of being "racist criminals", and accused the government of having "fuelled hatred" and of being "racist rednecks" and "evil fearmongers". He further accused 2GB of causing suffering to many Muslims in Australia. 92 Trad v Harbour Radio Pty Ltd [2009] NSWSC 750 at [6]. 93 This Act has been superseded by the Defamation Act 2005 (NSW). However, as the broadcast was aired before 1 January 2006, the Defamation Act 1974 (NSW) governs these proceedings. In the broadcast aired the following day, Mr Morrison described Mr Trad as a "well known apologist for the Islamic community spewing hatred and bile at anyone who did not agree with [his] philosophies and principles including this radio station". He said that Mr Glasscock, a reporter for 2GB who had been present at the rally, had been concerned for his own safety because Mr Trad had turned the event into a "hate 2GB rally." Mr Morrison repeated the essence of what Mr Trad had said about how 2GB "incite[s] people to commit acts of violence and [have] racist attitudes", in response to which he said, "I don't think that I've ever quite done that, like he did." One section of the broadcast gave rise to a number of the imputations that were found by the jury. Mr Morrison said: "Now, Keysar Trad, you are a disgraceful individual and I'm not alone in thinking this, I won't talk to you on the air because you represent no one's views other than your own, so you know, why you call up purporting to be from the Islamic community is beyond me. You are one guy who basically has been marginalized. And I think the more you say the more you represent to me that you are a dangerous individual to be out there trying to represent the views because I think you're responsible about more misinformation about the Islamic community of the attitudes of Christian Australians than any other person. Now he is widely perceived as a pest, that's the way I see him, he is not a peacemaker, so why he was invited to a peace rally is beyond me." Towards the conclusion of the broadcast, Mr Morrison said of Mr Trad: "he does nothing to try to address the actual issues, he just wants to sort of hatchet job people who once gave him the privileged position that he thinks he has." The imputations At trial, a jury found that statements made in the broadcast contained the following imputations concerning Mr Trad and were defamatory of him94: [Mr Trad] stirred up hatred against a 2GB reporter which caused him to have concerns about his own personal safety; [Mr Trad] incites people to commit acts of violence; [Mr Trad] incites people to have racist attitudes; 94 Trad v Harbour Radio Pty Ltd [2009] NSWSC 750 at [2]. [Mr Trad] is a dangerous individual; [Mr Trad] is a disgraceful individual; [Mr Trad] is widely perceived as a pest; [Mr Trad] deliberately gives out misinformation about the Islamic community; [Mr Trad] attacks those people who once gave him a privileged position." Under the 1974 Act, each of the imputations constituted a separate cause of action95. Questions as to the applicability of the defences pleaded by 2GB to those imputations fell to be determined by McClellan CJ at CL, pursuant to s 7A(4)(a) of that Act. The defence of qualified privilege • Findings in the Supreme Court McClellan CJ at CL held that the defence of qualified privilege applied to all of the imputations. His Honour referred to the statement of Starke J in Loveday v Sun Newspapers Ltd96, that a person attacked has "both a right and an interest in repelling or refuting the attack, and the appeal to the public gives it a corresponding interest in the reply." His Honour considered that the attack by Mr Trad was a serious one and that 2GB was entitled to defend itself against it97. His Honour was satisfied that the broadcast was a response to Mr Trad's attack. Subject to the question of malice, 2GB was entitled to a vigorous response. The response was, in his Honour's view, proportionate to the attack98. The Court of Appeal of the Supreme Court of New South Wales (Tobias, McColl and Basten JJA) observed that qualified privilege is a rare example of the law permitting an individual to seek self-redress by conduct that would otherwise be unlawful, by making defamatory statements99. Their Honours considered the 95 John Fairfax Publications Pty Ltd v Gacic (2007) 230 CLR 291 at 299 [16], 314 [70]; [2007] HCA 28. 96 (1938) 59 CLR 503 at 515; [1938] HCA 28. 97 Trad v Harbour Radio Pty Ltd [2009] NSWSC 750 at [137]. 98 Trad v Harbour Radio Pty Ltd [2009] NSWSC 750 at [140]-[141]. 99 Trad v Harbour Radio Pty Ltd (2011) 279 ALR 183 at 207 [108]. question in this case to be whether the defamatory matter is relevant to the occasion of qualified privilege100. However, their Honours also identified another question as arising: "whether the response exceeded permissible limits."101 A question which therefore arises on this aspect of the appeal is whether some test of reasonableness of response is to be applied to limit the scope of the privilege in a case of this kind. The law clearly requires that defamatory statements made in response to an attack be relevant to the allegations made in the attack or to the vindication of a defendant's reputation or interests. Statements which seem excessive in their language or content are to be considered in connection with the question of the defendant's malice, in respect of which the plaintiff bears the onus of proof. A consideration of the operation of the privilege and its relationship with the question of malice does not, in my view, provide support for a requirement additional to that of relevance, in order for the privilege to apply. • Background to the privilege An appreciation of the place, historically, of malice in defamation law is necessary to an understanding of the proper operation of qualified privilege. Until the early to mid-19th century, malice was the "foundation" of the action for defamation102. A person making a defamatory statement was presumed to be malicious. Such an approach may owe something to the ecclesiastical courts, although a more general explanation may be that, absent an explanation by the defendant, it was assumed that there could be no reason why anyone would defame another, other than malice103. In any event, the defence of qualified privilege emerged in the 1760s, in cases involving references given by masters about their servants, and its function was to reverse the burden of proof of malice such that it was borne by the plaintiff104. 100 Trad v Harbour Radio Pty Ltd (2011) 279 ALR 183 at 209 [111]. 101 Trad v Harbour Radio Pty Ltd (2011) 279 ALR 183 at 207 [108]. 102 Mitchell, "Duties, Interests, and Motives: Privileged Occasions in Defamation", (1998) 18 Oxford Journal of Legal Studies 381 at 381, quoting Whiteley v Adams (1863) 15 CB (NS) 392 at 414 per Erle CJ [143 ER 838 at 846]. 103 Mitchell, "Duties, Interests, and Motives: Privileged Occasions in Defamation", (1998) 18 Oxford Journal of Legal Studies 381 at 383. 104 Mitchell, "Duties, Interests, and Motives: Privileged Occasions in Defamation", (1998) 18 Oxford Journal of Legal Studies 381 at 383-390. The starting point for a consideration of the intended operation of the privilege is therefore the law's assumption that a defamatory statement was made maliciously. This assumption is overcome if the law holds that an occasion arose which warranted the making of the defamatory statement. An occasion for the making of such a statement may arise where the maker of the statement has a duty or an interest, which the law recognises, in making the statement (questions of reciprocity of interest will be discussed later in these reasons). When such an occasion arises, the statement is protected by a privilege afforded by the law. The duty or interest is regarded as creating the occasion to speak and the occasion prevents the law assuming malice. The privilege is qualified, because it may be lost if actual malice is proved by the plaintiff. This summary of the operation of the defence of qualified privilege is borne out by what was said by Parke B in the following quoted passage from Toogood v Spyring105: "In general, an action lies for the malicious publication of statements which are false in fact, and injurious to the character of another (within the well-known limits as to verbal slander), and the law considers such publication as malicious, unless it is fairly made by a person in the discharge of some public or private duty, whether legal or moral, or in the conduct of his own affairs, in matters where his interest is concerned. In such cases, the occasion prevents the inference of malice, which the law draws from unauthorized communications, and affords a qualified defence depending upon the absence of actual malice. If fairly warranted by any reasonable occasion or such communications are protected for the common convenience and welfare of society; and the law has not restricted the right to make them within any narrow limits." and honestly made, exigency, It has been pointed out that Parke B did not intend Toogood v Spyring to be definitive of the privilege, but rather illustrative106. In Wright v Woodgate107, which Parke B heard with Alderson and Gurney BB and Lord Abinger CB the year following Toogood v Spyring, Parke B said108: "The proper meaning of a privileged communication is only this; that the occasion on which the communication was made rebuts the inference 105 (1834) 1 Cr M & R 181 at 193 [149 ER 1044 at 1049-1050]. 106 Mitchell, "Duties, Interests, and Motives: Privileged Occasions in Defamation", (1998) 18 Oxford Journal of Legal Studies 381 at 392. 107 (1835) 2 Cr M & R 573 [150 ER 244]. 108 Wright v Woodgate (1835) 2 Cr M & R 573 at 577 [150 ER 244 at 246]. prima facie arising from a statement prejudicial to the character of the plaintiff, and puts it upon him to prove that there was malice in fact – that the defendant was actuated by motives of personal spite or ill-will, independent of the occasion on which the communication was made." In Cush v Dillon109, it was explained that the defence of qualified privilege is based upon notions of public policy, that in some circumstances the freedom to speak may assume more importance than an individual's right to the protection of his or her reputation. Parke B in Toogood v Spyring spoke of statements made in circumstances where the privilege arose as being protected "for the common convenience and welfare of society"110. Statements such as this should be understood in light of the policy of the law which promotes freedom of speech where the occasion for doing so arises. They provide no support for the application of some further social standard of reasonableness which would limit the scope of the privilege. McHugh J in Bashford v Information Australia (Newsletters) Pty Ltd111 considered that the words in Toogood v Spyring did not express a test which may prevent the privilege arising112. I respectfully agree. Judgments nowadays sometimes refer to what was said in Toogood v Spyring about the basis of the privilege being the "common convenience and welfare of society" by way of conclusion or as confirming the view taken as consistent with those ends. It has been said113 that in the period following Toogood v Spyring, some judges used the notion of "the common convenience and welfare of society" as the basis of the defence, but that this had its detractors, including Lord Esher MR, who (when Brett LJ) initially supported it114 only to later abandon it115 in favour of determining whether a duty or interest on the part of the defendant existed. Part of the confusion in this period is attributed to a lack of clear understanding about the relationship between qualified privilege and malice. It may be that that confusion continues today. 109 (2011) 243 CLR 298 at 305 [12] per French CJ, Crennan and Kiefel JJ; [2011] HCA 30; see also Aktas v Westpac Banking Corporation (2010) 241 CLR 79 at 89 [22], 108-109 [89]-[91]; [2010] HCA 25. 110 Toogood v Spyring (1834) 1 Cr M & R 181 at 193 [149 ER 1044 at 1050]. 111 (2004) 218 CLR 366 at 386-387 [55]; [2004] HCA 5. 112 As observed in Aktas v Westpac Banking Corporation (2010) 241 CLR 79 at 103- 104 [72] per Heydon J; and see 110 [97] per Kiefel J. 113 Mitchell, The Making of the Modern Law of Defamation, (2005) at 161-162. 114 Waller v Loch (1881) 7 QBD 619 at 622. 115 Pullman v Hill & Co [1891] 1 QB 524 at 528. Further, in the course of the development of the defence of qualified privilege, a test of whether "it is right in the interests of society to speak" was applied for a time, but it was applied to mitigate the arbitrary effects of a strict duty/interest test and to avoid questions about the scope of duties or interests116. Its limitations became evident when the question was raised whether the privilege could apply when the defendant was mistaken as to whether there was a duty to speak. (It was held that an honest belief in the existence of a duty sufficed117.) The courts subsequently reverted to the approach suggested in Toogood v Spyring118. It is of interest to observe that some Australian jurisdictions introduced statutory excuses for the publication of defamatory matter where the matter was published "for the public good"119, but as an alternative defence to that arising where a statement is made in the protection of interests. So far as concerns the common law privilege which is founded upon the existence of a duty or interest to speak, the leading cases such as Adam v Ward120 do not suggest an assessment of the public interest as necessary or appropriate to the scope and operation of the privilege. Rather, they require that a defamatory statement made in response to an attack be relevant to the occasion and to the vindication of the defendant's reputation. • Duty or interest to speak in cases of attack Generally, the law requires that there be a reciprocity of duty and interest as between the maker of a defamatory statement and the recipient of it121. It has 116 Mitchell, "Duties, Interests, and Motives: Privileged Occasions in Defamation", (1998) 18 Oxford Journal of Legal Studies 381 at 401. 117 Waller v Loch (1881) 7 QBD 619 at 621 per Jessel MR. 118 Mitchell, "Duties, Interests, and Motives: Privileged Occasions in Defamation", (1998) 18 Oxford Journal of Legal Studies 381 at 402-404. 119 See: Defamation Act 1889 (Q), s 16(1)(c) or, prior to 16 June 1995, Criminal Code (Q), s 377(1)(c), a predecessor of which was considered in Telegraph Newspaper Co Ltd v Bedford (1934) 50 CLR 632; [1934] HCA 15; Defamation Act 1957 (Tas), s 16(1)(c); and Criminal Code (WA), s 357(3), all of which were repealed as part of the adoption of the uniform defamation law. 120 [1917] AC 309 at 320-321. 121 Adam v Ward [1917] AC 309 at 334; Cush v Dillon (2011) 243 CLR 298 at 305 [11]; Roberts v Bass (2002) 212 CLR 1 at 26 [62]; [2002] HCA 57. been suggested that this requirement may have arisen in line with later developments in the torts of deceit and negligence122. In Norton v Hoare [No 1]123, Barton ACJ observed that in cases involving defamatory statements made in response to attacks on a defendant's reputation or interests, there may not be the same community of interest, or corresponding interest, as there is in other cases of privilege124. The case confirmed that a defendant nevertheless had a right to respond to attacks. The principal question in Norton v Hoare [No 1] was whether the entitlement extends to attacks upon a defendant's property interests, as well as his or her reputation125. It was in the context of the defence of property that an analogy was drawn with what may be done by way of self-defence126. The usefulness of the analogy may be doubted and does not appear to have been taken up in later cases. It is notable that Norton v Hoare [No 1] was decided before Adam v Ward, which explained much about the operation of the defence of qualified privilege. Adam v Ward involved an attack by the plaintiff, a member of Parliament, in Parliament, upon an Army General. The plaintiff alleged that the General had made deliberately misleading statements concerning one or more officers in a confidential report. An enquiry into the allegation, by the Army Council, vindicated the General and did so, in part, by identifying the plaintiff as one of the officers who had been made the subject of the report and had been called upon to retire from the service. A letter written by the secretary of the Council, containing these facts, was published not only to the General, but also to the press. Lord Atkinson alone in Adam v Ward appears to have addressed the question of the interest of the public in the matter published about the plaintiff. His Lordship observed that every person may be taken to have an interest in the British Army, including its discipline and efficiency127. In Mowlds v 122 Mitchell, "Duties, Interests, and Motives: Privileged Occasions in Defamation", (1998) 18 Oxford Journal of Legal Studies 381 at 405-406. 123 (1913) 17 CLR 310; [1913] HCA 51. 124 Norton v Hoare [No 1] (1913) 17 CLR 310 at 318. 125 See Norton v Hoare [No 1] (1913) 17 CLR 310 at 318 per Barton ACJ. 126 Norton v Hoare [No 1] (1913) 17 CLR 310 at 318 per Barton ACJ, 321-322 per Isaacs, Gavan Duffy and Rich JJ. 127 Adam v Ward [1917] AC 309 at 343. Fergusson128, Dixon J referred to Lord Atkinson's statement to explain that notions of corresponding duty or interest must be "very widely interpreted" when defamatory matter is published in self-defence, in defence or protection of an interest, or by way of vindication of reputation following an attack129. It was accepted at an early point in the development of the privilege that a defendant might be entitled to speak using the same medium as the plaintiff, when responding to what had been said by the plaintiff. In Hibbs (Clerk) v Wilkinson130, the editor of the defendant newspaper pointed out to readers that the plaintiff had published in the newspaper extracts of reviews that contained misquotations favouring the plaintiff. Erle CJ, in directing the jury, said that although it was a case of a kind which was "more rare" than the usual case of defamatory statements involving a servant, it was governed by the same principles131. In Stephens v West Australian Newspapers Ltd132, McHugh J observed that the need for reciprocity might defeat a claim of qualified privilege where the defamatory statement has been made to the general public and that it is only in "exceptional cases" that a person has "an interest or duty to publish defamatory matter to the world at large"133. However, his Honour accepted that circumstances may exist where the public's interest is such as to warrant such publication134. In such a case there seems no reason to doubt that the same principles relating to the defence of qualified privilege are to be applied, as Erle CJ suggested, and nothing to suggest that they require modification. Mowlds v Fergusson did not involve the publication of a defamatory statement at large. Nevertheless, it does provide an example of how this Court has dealt with the requirement of reciprocity. The facts of the case may be stated summarily: in 1934 the respondent (R), a police inspector, made a report on, inter alia, the conduct of A; R was criticised by a Royal Commission concerning 128 (1940) 64 CLR 206; [1940] HCA 38. 129 Mowlds v Fergusson (1940) 64 CLR 206 at 214-215. 130 (1859) 1 F & F 608 [175 ER 873]. 131 Hibbs (Clerk) v Wilkinson (1859) 1 F & F 608 at 610 [175 ER 873 at 874]. 132 (1994) 182 CLR 211 at 261 (footnote omitted); [1994] HCA 45. 133 See also Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 570; [1997] HCA 25. 134 Stephens v West Australian Newspapers Ltd (1994) 182 CLR 211 at 261-262. that report; at the request of the Premier of the State, R produced another report in which he sought to justify his 1934 report and in that process defamed A; R showed the report to C, who had been the Commissioner of Police at the time of the 1934 report, and thereby published the defamation. The Court held that the publication of the statements by R to C were protected by qualified privilege. But it will be observed that this was so notwithstanding that the interests of R and C did not correspond in the usual sense. R was not impelled to make the statement because of some duty towards C or because of an interest C had. He made the statement in the course of seeking to defend himself. Starke J saw R as having a duty or interest to justify himself to his former chief, C, and considered that C had a duty or interest to hear that justification135. Dixon J considered that the Premier's request placed R upon his defence. The Commissioner's attack upon him called for a vindication of his reputation and C was a person to whom R might look for vindication, given his knowledge of all the facts136. His Honour additionally considered that C had an interest in knowing a consequence of his own former administration137. Dixon J appears to have doubted that it is necessary that there be reciprocity of interest in every case and to have considered that a defendant's own interests may be sufficient to sustain the defence. In Mowlds v Fergusson, in discussing the requirement of reciprocity, his Honour quoted that part of the statement in Toogood v Spyring138 where Parke B spoke of communications "fairly made by a person … in the conduct of his own affairs, in matters where his interest is concerned", which, Dixon J observed, "demands no community, reciprocity or correspondency either of interest or duty."139 Dixon J repeated these observations in Guise v Kouvelis140, prefacing them with the remark that, "[t]he reduction of matters of privilege to formulas of duty and interest and of corresponding interest or duty has tended to the introduction of dialectical tests in a matter essentially of doctrine and, moreover, a matter covered by many decided cases which do not always respond easily to the formulas." 135 Mowlds v Fergusson (1940) 64 CLR 206 at 211-212. 136 Mowlds v Fergusson (1940) 64 CLR 206 at 214-215. 137 Mowlds v Fergusson (1940) 64 CLR 206 at 215. 138 (1834) 1 Cr M & R 181 at 193 [149 ER 1044 at 1049-1050]. 139 Mowlds v Fergusson (1940) 64 CLR 206 at 215. 140 (1947) 74 CLR 102 at 125; [1947] HCA 13. In Loveday v Sun Newspapers Ltd141, to which McClellan CJ at CL referred in this case, two statements were published by the defendant newspaper in one article. One was an attack by a body against the Canterbury Municipal Council for refusing the plaintiff relief work, and the other was a statement in reply by the town clerk of the Municipality of Canterbury, which said that the plaintiff had been refused the work because of unsatisfactory conduct on his part. The Court accepted that the Council and the clerk were entitled to reply and that the occasion was privileged. Starke J observed that a person attacked has a right and an interest in repelling or refuting the attack, and that an appeal by the attacker to the public gives the public a corresponding interest in the reply142. In Penton v Calwell143, Arthur Calwell, a member of Parliament, alleged in Parliament that a newspaper had refused to abide by wartime censorship restrictions in reporting the escape of prisoners of war in New South Wales. The newspaper editor responded in an article, in which it was claimed that Mr Calwell had lied, and called him "maliciously and corruptly untruthful; in other words a dishonest, calculating liar"144, and invited him to take action against the newspaper in court. The Court held that the statements were privileged, being made in reply to attacks upon the character or conduct of the defendant or in the protection of his interests145. In doing so it varied the decision of Dixon J at first instance, on an application to strike out part of the defence. In his judgment, Dixon J did not depart from anything he had earlier said concerning the privilege. His Honour said that "the purpose of the privilege is to enable the defendant on his part freely to submit his answer, whether it be strictly defensive or be by way of counter-attack, to the public to whom the plaintiff has appealed"146; and, further, that "[t]he foundation of the privilege is the necessity of allowing the party attacked free scope to place his case before the body whose judgment the attacking party has sought to affect … The purpose is to prevent the charges operating to his prejudice."147 The point of disagreement between the 141 (1938) 59 CLR 503. 142 Loveday v Sun Newspapers Ltd (1938) 59 CLR 503 at 515. 143 (1945) 70 CLR 219; [1945] HCA 51. 144 Penton v Calwell (1945) 70 CLR 219 at 225-226. 145 Penton v Calwell (1945) 70 CLR 219 at 243 per Latham CJ and Williams J, 250 146 Penton v Calwell (1945) 70 CLR 219 at 233. 147 Penton v Calwell (1945) 70 CLR 219 at 233-234. Full Court and Dixon J concerned the effect of the "invitation" to sue upon the operation of the defence. It will be necessary to say something about the approach of Dixon J later in these reasons, when further considering whether any test beyond that of relevance is to be applied in cases of this kind. For present purposes it may be observed that the cases consistently regard an attack by a plaintiff in the public sphere as creating an interest in responding to a like audience, and that the public is regarded as having an interest in hearing that response. In the present case, as the trial judge observed, Mr Trad made a serious attack upon 2GB and one of its commentators. It follows that 2GB had an interest in vindicating its reputation. Mr Trad's attack was made to the public at large – to the persons present at the rally and to other persons through the media outlets there present. 2GB was therefore entitled to respond to the public. • The requirement of relevance It has never been suggested that the defence of qualified privilege is absolute. It is not unbounded and may be lost on proof of actual malice. An attack upon a defendant's reputation does not provide an occasion for defamatory remarks having no connection to the attack or the need for the defendant to vindicate himself or herself. But it is not necessary to confine the scope of the privilege by other considerations, such as whether the response goes too far, is unreasonable or is out of proportion to the attack. Such considerations are essentially subjective and may create uncertainty as to the operation of the defence, which is largely a question of law. Moreover, such considerations may have the effect of blurring the boundary between facts relevant to the privilege and facts relevant to the issue of malice. A test of relevance is necessarily objective and does not confuse matters pertaining to the subjective question of whether a defendant was improperly motivated, and therefore malicious in using the words complained of, with matters from which it may be concluded that the words were spoken on an occasion of qualified privilege. When words are found to have been spoken on an occasion of privilege, the onus of proving malice on the part of the defendant shifts to the plaintiff. If the plaintiff discharges the onus the privilege is defeated. Absent proof of malice, the privilege operates to protect statements which have the required connection to the occasion. The cases decided by this Court in the context of defamatory statements in reply consistently refer only to a test of relevance as a limitation upon the defence of qualified privilege. In the first edition of Gatley's text148 the distinction mentioned was maintained. It was said that a person whose character has been attacked is entitled to respond and if in doing so he makes defamatory statements about the person who attacked him, "such statements will be privileged, provided they are fairly relevant to the accusations made against him and published bonâ fide."149 Such a person was entitled to appeal to the same audience as his attacker and if, in answering the attack, "he makes relevant defamatory statements about the person who has attacked him, such statements are primâ facie privileged."150 Decisions of this Court appear to have adopted such an approach. In Loveday v Sun Newspapers Ltd151, Starke J said that "[t]he privilege is not absolute: in case a person is attacked the answer must be relevant to the attack and must not be actuated by motives of personal spite or ill will independent of the occasion on which the communication was made". In Guise v Kouvelis152, Dixon J, although in dissent in the result, observed that "unless the words complained of were so foreign to the occasion that they must be held extraneous or irrelevant, the rest is all matter for the jury." "The rest", plainly, is evidence going to malice, which was at that time the province of the jury. Likewise, in Penton v Calwell it was held that if the occasion exists, the protection extends to communications relevant to the matter which gives rise to the occasion153. Latham CJ and Williams J said that, when a person has been seriously and abusively attacked, "the terms of his reply are not measured in very nice scales, but excess in reply may so exceed a reasonable view of the necessities of the occasion as to provide evidence from which malice may be inferred."154 In Penton v Calwell, Dixon J had held that the form of the defamation took it outside the privilege claimed for the occasion155. It is apparent that his 148 Law and Practice of Libel and Slander in a Civil Action, (1924). 149 Gatley, Law and Practice of Libel and Slander in a Civil Action, (1924) at 262. 150 Gatley, Law and Practice of Libel and Slander in a Civil Action, (1924) at 264. 151 (1938) 59 CLR 503 at 516. 152 (1947) 74 CLR 102 at 118. 153 (1945) 70 CLR 219 at 242 per Latham CJ and Williams J, 250 per Starke J. 154 Penton v Calwell (1945) 70 CLR 219 at 243. 155 Penton v Calwell (1945) 70 CLR 219 at 234. Honour considered the newspaper editor's invitation to sue to have this effect, whereas the Full Court considered that it did not prevent the defence arising, there being no inconsistency between the invitation to sue and the operation of the defence156. In the course of his reasons, Dixon J said that the defendant might, in the exercise of the privilege, impugn the truth of the charges and even the veracity of the attacker "if it be commensurate with the occasion."157 Of itself this statement is not strong support for an additional test such as proportionality, given in particular his Honour's approach to the operation of the privilege in Guise v Kouvelis. Such a test was not at the forefront of the concerns expressed by his Honour in Penton v Calwell. His Honour clearly considered that the invitation to sue denied the defence, in large part because it showed that the newspaper editor's response was not directed to the appropriate audience, the public. His Honour said that "the purpose of the privilege is to enable the defendant … freely to submit his answer … to the public to whom the plaintiff has appealed"158 and "[t]he foundation of the privilege is the necessity of allowing the party attacked free scope to place his case before the body whose judgment the attacking party has sought to affect. In this instance, it is assumed to be the entire public."159 In any event, the Full Court did not agree with his Honour's view that the challenge or invitation to sue was not for the purpose of self-defence and relevant thereto160. Latham CJ, Williams and Starke JJ held that the language used by the defendant in repelling the defamatory accusations fell to be considered in connection with malice161. More recently, the statement of Dixon J in Guise v Kouvelis162 that, "unless the words complained of were so foreign to the occasion that they must 156 Penton v Calwell (1945) 70 CLR 219 at 245 per Latham CJ and Williams J, 247- 248 per Rich J, 250 per Starke J. 157 Penton v Calwell (1945) 70 CLR 219 at 234. 158 Penton v Calwell (1945) 70 CLR 219 at 233. 159 Penton v Calwell (1945) 70 CLR 219 at 233-234. 160 Penton v Calwell (1945) 70 CLR 219 at 244-245 per Latham CJ and Williams J, 250 per Starke J. See also at 247-248 per Rich J. 161 Penton v Calwell (1945) 70 CLR 219 at 243 per Latham CJ and Williams J, 250 162 (1947) 74 CLR 102 at 118. be held extraneous or irrelevant, the rest is all matter for the jury", was approved in Cush v Dillon163. And in Bashford164, it was held that the court below had been right to conclude that the defamatory matter was sufficiently connected to the occasion of privilege to attract the defence. In Cush v Dillon, it was argued that the defamatory statements "went too far" and thus fell outside of the "umbrella of the applicable privilege"165. After quoting Parke B's statement in Toogood v Spyring166, French CJ, Crennan and "Adam v Ward confirms that there may be limits to what may be said upon a subject on an occasion of qualified privilege and that those limits are to be tested by the connection of the statement to the subject." In Adam v Ward, Earl Loreburn had observed that "the fact that an occasion is privileged does not necessarily protect all that is said or written on that occasion" and that anything "not relevant and pertinent to the discharge of the duty … or the safeguarding of the interest which creates the privilege will not be protected."168 It may be necessary for the trial judge to consider whether the defendant has published something "beyond what was germane and reasonably appropriate to the occasion".169 Lord Dunedin spoke of a statement not within the privilege as one which was "quite unconnected with and irrelevant to the main statement"170; Lord Atkinson of "foreign and irrelevant matter"171; and Lord 163 (2011) 243 CLR 298 at 310 [26]. 164 Bashford v Information Australia (Newsletters) Pty Ltd (2004) 218 CLR 366 at 165 Cush v Dillon (2011) 243 CLR 298 at 307 [17] per French CJ, Crennan and 166 See at [110]. 167 Cush v Dillon (2011) 243 CLR 298 at 308 [19]. 168 Adam v Ward [1917] AC 309 at 320-321. 169 Adam v Ward [1917] AC 309 at 321. 170 Adam v Ward [1917] AC 309 at 327. 171 Adam v Ward [1917] AC 309 at 340. Shaw of Dunfermline of matter which was "not in any reasonable sense In Adam v Ward173, it was contended that the language to be used on a privileged occasion must be only "such as is reasonably necessary to enable the party making it to protect the interest or discharge the duty upon which the qualified privilege is founded" in order to have the protection of the defence. Lord Atkinson said, emphatically, that "this is not the law"174 and Lord Finlay LC considered that excessive language went to the issue of malice175. In Nevill v Fine Arts and General Insurance Company176 Lord Esher MR distinguished an excessive statement, otherwise connected to the privileged occasion, from one which has no connection. His Lordship said: "There may be an excess of the privilege in the sense that something has been published which is not within the privileged occasion at all, because it can have no reference to it. Instances have been put during the argument of cases where a defendant on an occasion which is privileged as between himself and some other person makes some defamatory statement affecting a third person which has nothing to do with the privileged occasion, in which case, of course, that third person would have a right of action against the defendant, and, as between him and the defendant, there would be no privileged occasion. But when there is only an excessive statement having reference to the privileged occasion, and which, therefore, comes within it, then the only way in which the excess is material is as being evidence of malice." Reference was made to this passage in Cush v Dillon177, where it was then said178: 172 Adam v Ward [1917] AC 309 at 348. 173 [1917] AC 309 at 334-335. 174 Adam v Ward [1917] AC 309 at 335. 175 Adam v Ward [1917] AC 309 at 318. 176 [1895] 2 QB 156 at 170. 177 (2011) 243 CLR 298 at 309-310 [24]. 178 (2011) 243 CLR 298 at 310 [25] (footnotes omitted). "The inquiry which precedes that of actual malice is undertaken in order to determine the boundaries of the privilege, by reference to the duty or interest which gave rise to it. It may be said to involve an objective assessment. It is not to be confused with an inquiry as to whether a person was actuated by malice in using exaggerated words. As Earl Loreburn observed in Adam v Ward, a statement which exceeds the occasion may be evidence of malice, but 'the two things are different'." Conclusions regarding relevance and privilege The attacks upon 2GB were serious. They accused it and certain of its hosts of racism and of inciting hatred. 2GB was entitled to address the public in response, to vindicate its reputation and interests. In doing so it was permitted some scope in achieving these objectives, so long as its responses were relevant to the attack and to the vindication of its reputation as affected by the attack. Imputations (a), (b) and (c) call the attention of the public to Mr Trad's own conduct and motives. It does not matter to the defence that Mr Morrison may have been mistaken about whether the reporter in fact feared for his safety. The essential point was that Mr Trad himself appeared to fuel fear and hatred against 2GB, which was the very accusation he had directed against it. The three imputations suggest hypocrisy upon his part and that his true purpose in making the attack on 2GB was to incite racism and violence. These counter-accusations are directly relevant to what Mr Trad had levelled at 2GB and it was entitled to reply in this way. The statements challenged his credibility and cast doubt upon his motives for attacking 2GB. Imputations (a), (b) and (c) also provide the context for imputations (d) and (g), that Mr Trad is "dangerous" and "disgraceful". Imputations (d) and (g) may also be viewed as linked to the statements that Mr Trad does not represent the views of the Muslim community and presents misinformation, particularly about issues concerning that community (imputation (j)). They are likewise responses addressed to the public which suggest that he is not to be trusted in what he says. therefore as supportive of 2GB's position. Imputations (h) and (k) do not, however, have a proper connection to matters of attack upon 2GB, nor are they put forward as challenges to Mr Trad's credibility and A "pest" (imputation (h)) is someone who is annoying and may be so because they interfere in matters which are not of their concern. It may therefore imply some officiousness in the person's conduct. But the attacks upon 2GB were not of this nature, as a comparison with 2GB's other responses shows. No link is evident between this statement and the attacks. It is difficult to infer precisely what the jury understood by imputation (k). The terms of the imputation merely repeat the statement made by Mr Morrison that Mr Trad attacks those who once gave him a privileged position. This may imply some kind of disloyalty, although it is far from clear who provided him with the position and what the position was. It was suggested in argument that it was the media, which had previously given him a platform from which to express his views. If this is the case, it is not a relevant response to the substance of the attacks upon 2GB nor does it pertain to anything concerning Mr Trad that might cast doubt upon the attack he made. Imputations (h) and (k) are therefore not protected by the privilege. These imputations will therefore necessitate consideration of the defence of truth and in particular that of contextual truth. Malice Proof of malice requires that it be shown that a defendant was actuated by an improper motive, one foreign to the occasion and therefore destructive of the privilege179. In this case Mr Trad pleaded that 2GB had not made proper enquiries and had pleaded false and misleading particulars of truth. These allegations directed attention to the statements made by Mr Morrison, that the 2GB reporter present at the rally, Mr Glasscock, feared for his safety because of the conduct of Mr Trad. McClellan CJ at CL observed that, whilst 2GB did not lead evidence on the issue, the visual recording of Mr Trad's speech showed the 2GB reporter positioned in front of Mr Trad during his speech. His Honour found that the prominence of the reporter's position, his identification as a reporter from 2GB and the obvious hostility of the crowd towards 2GB may well have engendered a feeling of vulnerability in him. In these circumstances, his Honour considered that Mr Morrison may have come to an understandable, though erroneous, view that the reporter had felt it necessary to withdraw from a prominent position. His Honour was unable to conclude that Mr Morrison knew his remarks were wrong or that he was improperly motivated when he made them180. Although the Court of Appeal expressed reservations about the terms of his Honour's findings, it did not consider that the essential finding, that Mr Morrison had not been shown to have acted with malice, could be disturbed181. On this appeal, argument on behalf of Mr Trad was directed to the knowledge of Mr Glasscock as proof of malice. It was argued that Mr Glasscock would have known that the statement that he was concerned for his safety was 179 Roberts v Bass (2002) 212 CLR 1 at 30-31 [75]-[76]; Cush v Dillon (2011) 243 CLR 298 at 311 [28]. 180 Trad v Harbour Radio Pty Ltd [2009] NSWSC 750 at [146]. 181 Trad v Harbour Radio Pty Ltd (2011) 279 ALR 183 at 210 [118]. untrue. I am not satisfied that this argument was squarely raised at trial or on the appeal below. In any event it misunderstands the relevant issue at trial, which was not what Mr Glasscock may have later appreciated about what Mr Morrison had said. If 2GB were to be held vicariously liable, it would be because the defamatory improperly motivated when he made statements. The evidence did not permit such a conclusion. I agree with the joint reasons that the respondent should be refused an extension of time to file a notice of contention on the issue of malice. I also agree that leave to file the notice of cross-appeal should exclude ground 2(f). Truth McClellan CJ at CL considered statements that had previously been made by Mr Trad on a number of topics, including racism, homosexuality, punishments for a wife's adultery and the responsibility some women should bear in the case of rape. This comprised, in part, Mr Trad's reflections upon what had been said by others on those subjects and included some controversial statements made by Sheikh Taj el-Din al-Hilali182. His Honour found that the defence of substantial truth (s 15) applied to imputations (b), (c), (d) and (g)183. 2GB did not seek to justify imputations (a) and (k) as substantially true and, in McClellan CJ at CL's view, failed to prove imputations (h) and (j)184. However, his Honour held that the defence of contextual truth (s 16) applied to these four imputations. His Honour held that, because imputations (b), (c), (d) and (g) were substantially true, imputations (a), (h), (j) and (k) did not occasion further injury to Mr Trad's reputation185. The approach generally adopted by his Honour in applying the defence of substantial truth was to consider whether the views expressed by Mr Trad would be acceptable to "right thinking" members of the Australian community186. His Honour's conclusions were expressed to follow upon the application of such a 182 Trad v Harbour Radio Pty Ltd [2009] NSWSC 750 at [27]-[97]. 183 Trad v Harbour Radio Pty Ltd [2009] NSWSC 750 at [129]. 184 Trad v Harbour Radio Pty Ltd [2009] NSWSC 750 at [98], [121], [123], [129]. 185 Trad v Harbour Radio Pty Ltd [2009] NSWSC 750 at [129]. 186 Trad v Harbour Radio Pty Ltd [2009] NSWSC 750 at [20], [34], [45], [47], [51], test, even though at earlier points in his reasons his Honour had referred to "general community standards" as relevant187. The question raised by the defence, however, was not what such persons might think of Mr Trad's views. The question was whether he could be said to have incited people to commit acts of violence (imputation (b)); to have incited people to have racist attitudes (imputation (c)); and to be a dangerous (imputation (d)) and disgraceful (imputation (g)) individual, because of the views he had expressed. Only with respect to the more difficult of the imputations respecting the application of the defence, imputation (g), did his Honour conclude as a fact that Mr Trad was a disgraceful person188. His Honour's findings with respect to the other imputations did not reach a conclusion of the substantial truth of the defamatory imputations. They were limited to the opinion that right-thinking persons might have of his views. Although applying the test of the views of right-thinking persons, his Honour made mention189 of the decision of this Court in Radio 2UE Sydney Pty Ltd v Chesterton190, where reference was made to the standards of the general community as applicable. In that case, it was observed that the expression "right- thinking", used in connection with the hypothetical referee of moral or social standards, had been criticised191. It was said that the expression should not be understood to involve particular moral or social standards, but to describe a person who shares the standards of ordinary, decent persons in the general community. By this means, views which would be considered unacceptable by such persons would be excluded from the hypothetical referee's consideration192. It is not apparent that his Honour applied such standards. His Honour's consistent references to "right thinking" persons, in an unqualified way and in the context of moral judgments upon the views expressed by Mr Trad, leads one to doubt that the standards of ordinary persons in the community were applied. Moreover, the proper question posed for the hypothetical referee was not addressed, as has been explained. 187 Trad v Harbour Radio Pty Ltd [2009] NSWSC 750 at [14], [16]-[17], [20]. 188 Trad v Harbour Radio Pty Ltd [2009] NSWSC 750 at [114]. 189 Trad v Harbour Radio Pty Ltd [2009] NSWSC 750 at [16]. 190 (2009) 238 CLR 460 at 479 [43]; [2009] HCA 16. 191 Radio 2UE Sydney Pty Ltd v Chesterton (2009) 238 CLR 460 at 477-478 [39]. 192 Radio 2UE Sydney Pty Ltd v Chesterton (2009) 238 CLR 460 at 477 [38], 478 [40]. The Court of Appeal observed the latter difficulty in much of his Honour's approach193, with the result that the findings respecting the defence could not be sustained194. However, the Court of Appeal did not go further and either conclude the matter for itself or remit the matter for consideration on the correct basis, in the absence of a notice of contention inviting that course to be taken. I agree with the joint reasons that it will be necessary for the Court of Appeal to reconsider so much of Mr Trad's appeal as concerns the defences of substantial truth and contextual truth. It will be necessary for consideration to be given to the defence of substantial truth with respect to each of imputations (b), (c), (d) and (g). Although the defence of qualified privilege applies to these four imputations, their substantial truth will need to be considered in order that a conclusion as to the defence of contextual truth respecting imputations (h) and (k) may be reached. These latter imputations do not have the protection of the privilege. Conclusion and orders I agree with the orders proposed in the joint reasons, with one qualification. In my view the appellant should have its costs of this appeal and the proceedings below. It succeeded on the main issue, the application of the defence of qualified privilege, and on the issue of malice. Remitter of the issue of substantial truth, for the purpose of a final determination on imputations (h) and (k), was inevitable and does not constitute success on the part of the respondent such as to warrant denying the appellant its costs. 193 Trad v Harbour Radio Pty Ltd (2011) 279 ALR 183 at 202 [79], [81], 203 [86]. 194 Trad v Harbour Radio Pty Ltd (2011) 279 ALR 183 at 203 [87].

HIGH COURT OF AUSTRALIA IN THE MATTER OF AN APPLICATION BY THE CHIEF COMMISSIONER OF POLICE (VICTORIA) APPLICANT/APPELLANT In the Matter of an Application by the Chief Commissioner of Police (Vic) [2005] HCA 18 Date of Order: 10 August 2004 Date of Publication of Reasons: 20 April 2005 M49/2004, M50/2004, M102/2004 and M103/2004 ORDER Matter No M49/2004 Application for special leave to appeal dismissed. Applicant to pay the intervener's costs of the application. Matter No M50/2004 Application for special leave to appeal dismissed. Applicant to pay the intervener's costs of the application. Matter No M102/2004 Appeal dismissed. Appellant to pay the intervener's costs of the appeal. Matter No M103/2004 Appeal dismissed. Appellant to pay the intervener's costs of the appeal. On appeal from the Supreme Court of Victoria Representation: F X Costigan QC with G J C Silbert for the applicant/appellant (instructed by Victorian Government Solicitor) D F R Beach SC with A T Strahan for the Age Company Limited, intervening in all matters (instructed by Minter Ellison Lawyers) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS In the Matter of an Application by the Chief Commissioner of Police (Vic) Practice and procedure – Appeal from order of trial judge to prohibit, for a limited time, the publication of methods and material used by police in murder investigations – Whether appeal to Court of Appeal barred by s 17A(3) of the Supreme Court Act 1986 (Vic) – Whether appeal lay as of right, or only by way of leave – Provision of additional written submissions following conclusion of hearing – Proper procedure to be observed. Procedural fairness – Whether Court of Appeal decided substantive issues without providing the Chief Commissioner of Police sufficient opportunity to present argument. Constitutional law (Cth) – Appeal to High Court – Manner of conduct of proceedings in Court of Appeal – Elaboration of record by affidavit evidence – Whether affidavit admissible – Whether orders subject to appeal – Whether disjoined from administration of the law – Whether statutory publication prohibition orders sufficiently connected with concluded criminal trials – Whether necessary and appropriate to consider questions. Words and phrases – "leave to appeal", "appeal as of right", "procedural fairness", "determination", "interlocutory", "in relation to". Supreme Court Act 1986 (Vic), ss 17A(3), 17A(4)(b), 18, 19. Crimes Act 1958 (Vic), s 567. GLEESON CJ, McHUGH, GUMMOW, HAYNE AND HEYDON JJ. During two separate and unrelated trials for murder1 in the Supreme Court of Victoria, evidence was led about the methods by which police had investigated the murders and ultimately obtained admissions by each accused. Although the evidence was given in open court, the police wanted to prevent further publication of these methods. The Chief Commissioner of Police (Victoria) (the present appellant – "the Commissioner") applied in each case for orders, pursuant to s 18 of the Supreme Court Act 1986 (Vic), prohibiting publication of the methods that had been used or of any material that would identify some undercover police. In each case, the trial judge made an order prohibiting publication of this information but, contrary to the submissions that had been made by the Commissioner, each order provided that it would remain in force only until a stated day. (The Commissioner had asked that the order be made without any time limit.) In each case, the order was made or repeated in open court and thereafter was entered in the ordinary way. The settled orders indicate that the applications were made on oral application by counsel for the Commissioner, supported by evidence. In each case, counsel for the Director of Public Prosecutions and the accused were present, at least for that part of the applications dealt with in open court and, in one case, counsel for The Age Company Limited ("The Age"), publisher of that newspaper, also was present in open court. In each case, the Commissioner sought to appeal to the Court of Appeal of Victoria. Two notices of appeal were filed, each entitled "In the matter of the Supreme Court Act 1986 s18" and "In the matter of The Queen v [the accused person at whose trial the application had been made]". In each appeal, the Commissioner filed a summons seeking two orders: that the Commissioner "have leave to appeal, if leave be necessary, against the orders" made by the trial judge; that the orders made by the trial judge "be continued pending the hearing of this appeal" and such further or other orders as the Court deemed fit. 1 R v Tofilau and R v Favata. The summonses came on for hearing by the Court of Appeal on 9 October 2003, being the day before the orders prohibiting publication were due to expire. The Age sought leave to intervene and, there being no other contradictor, was granted that leave. On 12 February 2004, the Court of Appeal made orders in each case that "[t]he application be dismissed". The authenticated orders of the Court of Appeal in each case recorded that the "application" which was dismissed was the application for leave to appeal. By special leave, the Commissioner appealed to this Court against each of those orders on two grounds: first, that the Court of Appeal erred in failing to hold that the Commissioner had an appeal to the Court of Appeal as of right and, secondly, that the Court of Appeal had denied the Commissioner procedural fairness. Against the possibility that no appeal (whether as of right or by leave) lay to the Court of Appeal against the orders made at first instance, the Commissioner applied for special leave to appeal from those orders. Those applications for special leave were heard at the same time as the appeals. At the conclusion of the hearing, this Court ordered that both appeals and both applications for special leave be dismissed and that the Commissioner pay the intervener's costs of the appeals and the applications. As was said at the time of making the orders, the applications for special leave were dismissed for the reason that there were insufficient prospects of success of an appeal to warrant a grant of special leave. What follows are our reasons for joining in the orders dismissing the appeals. The orders at first instance Sections 18 and 19 of the Supreme Court Act are an example of State legislation, like that considered in James Hardie & Coy Pty Ltd v Seltsam Pty Ltd2, which performs a double function, namely the creation of obligations and imposition of liabilities together with conferral of jurisdiction with reference to them. The occasion for the exercise of such jurisdiction may arise in the course of adjudication of a dispute of which the Court already is seized, here the two trials for murder. Another example is the third party contribution procedure considered in James Hardie, the exercise of which founded the appeal to the New South Wales Court of Appeal and then to this Court. (1998) 196 CLR 53 at 64-65 [22]-[24]. Section 18 of the Supreme Court Act empowers that Court, "in the circumstances mentioned in section 19", to make a number of different orders. One of those3 is an order "prohibiting the publication of a report of the whole or any part of a proceeding or of any information derived from a proceeding". Six different circumstances are mentioned in s 19. Only two need be noticed. The Supreme Court may make an order under s 18 "if in its opinion it is necessary to do so in order not to ... (b) prejudice the administration of justice; or (c) endanger the physical safety of any person". An order preventing publication of information derived from a proceeding that would identify a police officer who, at the time of the order, was engaged in some undercover operations may readily be seen to be an order directed to the circumstance identified in s 19(c). By contrast, it may be much more difficult to demonstrate that preventing publication of information about police investigative techniques would be necessary in order not to prejudice the administration of justice. In the present cases, the orders that were made at first instance (although cast in different terms) were directed to preventing publication by print or electronic means of particular investigative techniques that police had used. Those techniques depended upon the use of what were called "scenarios" and both orders prohibited publication of the "details" of those scenarios. In addition, both orders prohibited the publication of names or images of the undercover operatives who gave evidence at trial. It is neither necessary nor appropriate to examine the terms of the orders made at first instance. There was little or no argument in this Court about their terms. It is important, however, to notice that the apparently simple language in which ss 18 and 19 of the Supreme Court Act are cast may conceal a number of difficult questions whose resolution, in any particular case, would bear directly upon the way in which an order made under those sections would have to be framed. First, the relevant power given by s 18 is to make an order prohibiting the "publication" of certain matters. Even if, as was done in the orders now under consideration, the order identifies the prohibited act of publication by reference to the methods of publication (here, print or electronic means), what is the reach of that prohibition? Does it extend to publication in law reports, in transcripts of evidence, in notes of evidence made by a solicitor (published to another lawyer)? s 18(1)(c). Secondly, although there may be little doubt about what is meant by "a report of the whole or any part of a proceeding", what is meant by "any information derived from a proceeding"? Is that latter description satisfied if it can be shown that the subject of the publication was a subject dealt with in evidence or argument in the proceeding? Or must the information contained in the report have come to the attention of the publisher (first, only, chiefly) from what was said and done in the proceeding? These are questions the answers to which may both be informed by, and reflect on, what is meant by the various circumstances mentioned in s 19 – most notably the circumstance described as "prejudic[ing] the administration of justice". But they are not questions that were considered in argument and it would therefore be wrong now to attempt to answer them. As noted above, the orders made at first instance expired by effluxion of time. In order to allow the Commissioner to challenge the correctness of those orders, orders were made by single Judges of the Supreme Court extending the operation of the prohibitions until the completion of the Commissioner's proceedings, first in the Court of Appeal, and later in this Court. Again, the terms of those extending orders need not be noticed. But what that course of events demonstrates (if it were not otherwise clear) is that the orders which the Commissioner obtained at first instance were not orders that finally determined any right or obligation. The Court of Appeal's decision In its reasons, the Court of Appeal did not discuss whether, if an appeal lay to that Court, it lay as of right or only by leave. Rather, the Court addressed the logically prior question whether any appeal lay to the Court of Appeal or was barred by s 17A(3) of the Supreme Court Act. Section 17A(3) provided that: "Except as provided in Part VI of the Crimes Act 1958, an appeal does not lie from a determination of the Trial Division constituted by a Judge made on or in relation to the trial or proposed trial of a person on indictment or presentment." Were the orders made at first instance "a determination ... made on or in relation to the trial ... of a person on ... presentment"? Although the Court of Appeal examined a number of decisions of this Court4 and the Supreme Court of Victoria5 touching upon this question, it did not decide whether s 17A(3) precluded an appeal by the Commissioner against the orders that had been made at first instance. Rather, the Court said6 that it was prepared to assume, without deciding, that the Commissioner was correct in submitting that the Court had jurisdiction and that it made this assumption "for the purpose of enabling [it] to determine the substantive issue debated before [it] – namely whether the trial judges were in error in making the limited suppression orders which they did". The Court said7 that it was prepared to take this course because it had "reached a firm and united view upon that issue". The Court's reasons canvassed a number of considerations of which three can be seen as most important to the conclusion reached. They were, first, what was called8 "[t]he principle of open justice", secondly, the practical difficulties presented by questions of duration and the scope of effectiveness of the orders sought9 and, thirdly, what was thought10 to be the practical ineffectiveness of orders of the kind made to prevent dissemination of the information among "those who move in 'underworld' circles". The Court concluded11 that, there being no sufficient countervailing factors, there was "no basis for the making of the orders to suppress indefinitely the matters encompassed by the orders made" where indefinite suppression "would be both offensive to principle and almost certainly ineffectual". 4 For example, Smith v The Queen (1994) 181 CLR 338. 5 R v Kean and Mills [1985] VR 255; Victoria Legal Aid v Lewis [1998] 4 VR 517. In the Matter of an Application by Chief Commissioner of Police (Vic) for Leave to Appeal [2004] VSCA 3R at [22]. [2004] VSCA 3R at [22]. [2004] VSCA 3R at [25]. [2004] VSCA 3R at [45]. 10 [2004] VSCA 3R at [42]-[43], [46]. 11 [2004] VSCA 3R at [47]. The Commissioner submitted that it was apparent from the reasons of the Court of Appeal that the Court had decided the substantive issues which the Commissioner had sought to canvass on an appeal to the Court. The burden of the Commissioner's argument in this Court was that she had had no sufficient opportunity to present argument on those substantive issues and, therefore, had been denied procedural fairness. Filing further submissions and evidence in the Court of Appeal That the Commissioner had wanted a further opportunity to make submissions about the substantive issues was said to be shown by a memorandum which counsel for the Commissioner had sent to the Court of Appeal on 8 December 2003, after the oral argument on 9 October 2003 and before delivery of judgment. (The Court of Appeal had not given leave to file further submissions.) The memorandum said that the Commissioner "seeks the opportunity to file further material directly pertinent to the Application for Leave to Appeal and to make further submissions based on that material and the material already before the Court". It went on to say that the Commissioner did not wish to make any further submissions "in relation to jurisdiction". Two days later, again without leave, the Commissioner filed a further affidavit by the solicitor having the carriage of the matter on behalf of the Commissioner. The deponent deposed to information she had been given by police about the use of investigative techniques, of the kind referred to in the orders made at first instance, in relation to homicides that had occurred in New South Wales, South Australia and Western Australia. With this affidavit, the Commissioner filed further "Supplementary Submissions of the Appellant based on Additional material". Those submissions were said to be limited to the reasons why leave to appeal should be granted and emphasised what were said to be the significance and importance of the issues in the administration of justice in Victoria and elsewhere. On 15 December 2003, The Age filed what was called a "supplementary note" stating that The Age did not wish to make any further submissions on the question of jurisdiction or the application for leave to appeal. The note said that if leave was granted, The Age wanted to make submissions on the substantive issues and to seek leave to cross-appeal. On its face, the course followed appears to depart from, and to be sharply at odds with, orderly procedures for the disposition of matters before an appellate court. In R v Theophanous12, the Court of Appeal of Victoria had pointed out (not for the first time) that, in an appeal, once argument has been presented at the hearing, leave is necessary before further submissions may be made, and that leave to do so will be granted only in very exceptional circumstances13. Yet, without leave, further evidence and further submissions were filed after argument had concluded. Further, the course of events described reveals at least some inexactness of understanding of what issues were to be determined by the Court of Appeal. The Commissioner's contention that she was denied procedural fairness proceeded from the premise (not always clearly identified) that the only issue for debate before the Court of Appeal at the hearing on 9 October 2003 was an issue about that Court's jurisdiction. The reasons subsequently published by the Court of Appeal demonstrate that this was an issue which was agitated. The reasons record14 that the Commissioner and The Age both submitted, in response to queries raised by the Court of Appeal, that the Court had jurisdiction to entertain the application. But it was not demonstrated that this was the only issue for debate. What was before the Court of Appeal? There was no evidence or other material to which we were taken that showed that the Court of Appeal confined argument to a question about its jurisdiction. The very abbreviated account of proceedings before the Court of Appeal, given in an affidavit filed in this Court as evidence of what had happened below15 (there being no transcript of the argument), did not suggest that there was any order made, or anything said in the course of argument, that confined the issues for consideration. Conversely, there was no evidence or material which showed that the Court of Appeal enlarged the proceeding to hear argument as on a full appeal. 12 (2003) 141 A Crim R 216 at 286 [204]. 13 R v Zhan Yu Zhong [2003] VSCA 56 at [2]-[4]. See also Eastman v Director of Public Prosecutions (ACT) (2003) 214 CLR 318 at 330 [29]. 14 [2004] VSCA 3R at [12], [14]. 15 cf Government Insurance Office of NSW v Fredrichberg (1968) 118 CLR 403 at Rather, what were before the Court of Appeal, for argument, were the Commissioner's summonses seeking, first, "leave to appeal, if leave be necessary" and, secondly, continuation of the orders made at first instance. This second aspect of the application was overtaken by the extending orders mentioned earlier. (We were told that the Court of Appeal suggested this course but nothing turns on how or why this happened.) The only live issue before the Court of Appeal was that presented by the Commissioner's application for leave to appeal, if leave were necessary. Appeal to the Court of Appeal as of right? If, as the Court of Appeal assumed in its reasons, s 17A(3) of the Supreme Court Act did not preclude an appeal to that Court it was necessary, as the Commissioner's summonses acknowledged, to consider whether an appeal lay as of right or only by leave. Although this question was not mentioned in the Court of Appeal's reasons, those reasons were consistent with the Court assuming that leave was necessary. Whether leave was necessary depended upon the application of s 17A(4)(b). That section provided that an appeal does not lie to the Court of Appeal without the leave of the Judge constituting the Trial Division, or of the Court of Appeal, from a judgment or order in an interlocutory application except in certain cases. In Roy Morgan Research Centre Pty Ltd v Commissioner of State Revenue (Vict)16, it was noted that, on its face, s 17A(4)(b) directed attention to the nature of the application as interlocutory rather than to the nature of the order. It was also noted17 that the Court of Appeal has taken the view that the substitution of the expression "judgment or order in an interlocutory application" for the expression "interlocutory judgment", which was formerly used, involved no change in meaning18. The Court of Appeal has therefore since applied to 16 (2001) 207 CLR 72 at 82 [23]. 17 Roy Morgan Research Centre Pty Ltd v Commissioner of State Revenue (Vict) (2001) 207 CLR 72 at 82 [23]. 18 Border Auto Wreckers (Wodonga) Pty Ltd v Strathdee [1997] 2 VR 49; Little v Victoria [1998] 4 VR 596. s 17A(4)(b) the tests adopted in Licul v Corney19. The correctness of that approach was not challenged in this Court and it is, for that reason, neither necessary nor appropriate to examine it. But it follows inevitably from that understanding of s 17A(4)(b) that, if an appeal lay to the Court of Appeal, it lay only by leave. The orders which were made at first instance did not finally dispose of any rights20 and none of the exceptions to s 17A(4)(b) was said to be engaged. (In particular, it was not said that these were cases of "granting or refusing an injunction"21.) It is for these reasons that the first ground of appeal advanced in each case in this Court (that the Court of Appeal erred in failing to hold that the Commissioner had an appeal as of right) failed. It is not necessary to examine what we have called the logically prior question about the operation of s 17A(3). The Court of Appeal having reached no conclusion on that question, we would reserve its consideration for a case in which it was necessary to decide the point. Want of procedural fairness? Leave to appeal being necessary, if there was an appeal, it was for the party seeking leave, the Commissioner, to demonstrate to the Court of Appeal why leave should be granted. Showing that there was an arguable case of error was a necessary, but not sufficient, step in obtaining leave. Whether or not the Court of Appeal directed counsel's attention in argument to the logically prior question of whether any appeal lay, the return of the Commissioner's summonses seeking leave to appeal was the occasion to show an arguable case of error. What arguments were advanced, and what evidence was relied on to found those arguments, was a matter for the party seeking leave. The fact that it was later thought that other arguments might have been advanced, or that other evidence might have been relied on, does not demonstrate any want of procedural fairness. If, as the Court of Appeal concluded22, there was "no basis for the making of the orders to suppress indefinitely the matters encompassed by the orders", it 19 (1976) 180 CLR 213. See also Hall v Nominal Defendant (1966) 117 CLR 423; Carr v Finance Corporation of Australia Ltd [No 1] (1981) 147 CLR 246. 20 Licul v Corney (1976) 180 CLR 213 at 225. 21 s 17A(4)(b)(ii). 22 [2004] VSCA 3R at [47]. was open to that Court to conclude that the application for leave to appeal should fail. A conclusion that an order from which leave to appeal is sought is plainly right does not constitute some impermissible foray into issues that would arise only on a grant of leave and the hearing of an appeal. It is no more than an emphatic rejection of one aspect of the argument that must be made in support of a grant of leave. No want of procedural fairness was demonstrated. It is for these reasons that the second ground of appeal failed. Other, larger, questions that might have arisen in the appeals, about whether the orders made at first instance or by the Court of Appeal are within the appellate jurisdiction of this Court conferred by s 73 of the Constitution, were not addressed by counsel. There having been no argument of the points, and their decision being unnecessary for disposing of either the appeals or the applications for special leave, we express no view about them. Nor, given the grounds of appeal to this Court, is it necessary or appropriate to express any view about the reasoning of the Court of Appeal on the substantive questions which the Commissioner sought to agitate in that Court concerning the intersection of the need to administer justice openly and the provisions of ss 18 and 19 of the Supreme Court Act. Kirby KIRBY J. Four proceedings were commenced in this Court by the Chief Commissioner of Police (Vic) ("the Chief Commissioner"). Ultimately, each of them concerned a complaint that orders made for the non-publication of evidence in criminal trials in the Supreme Court of Victoria were erroneously limited in their duration and should be extended indefinitely. At the conclusion of argument the proceedings were dismissed. I now state my reasons for joining in the Court's orders. The history of the proceedings Two of the proceedings were heard as appeals23, pursuant to grants of special leave to appeal24, from a judgment of the Court of Appeal of the Supreme Court of Victoria25. That judgment represented the determination by the Court of Appeal of separate proceedings brought before that Court as purported appeals and, alternatively, summonses for leave to appeal, against orders made by two judges of the Supreme Court (Osborn J26 and Teague J27). Those determinations, in turn, decided applications by the Chief Commissioner for orders prohibiting the publication of evidence in the criminal trials over which those judges presided. The orders in issue were made by each judge pursuant to the Supreme Court Act 1986 (Vic)28 ("the Supreme Court Act"). The orders, the duration of which was later extended in the Supreme Court to the hearing and determination of the proceedings in this Court, were each originally subject to expiry on specified dates after the anticipated conclusion of the respective criminal trials. The Chief Commissioner contended that the orders should have been of indefinite duration, subject to liberty to apply in future to terminate their operation. She argued that, in terminating the operation of the orders as they did, the trial judges had erred, justifying appellate correction. 23 In High Court matters M34 and M35 of 2004. 24 [2004] HCATrans 127 at [553]. 25 In the matter of an application by Chief Commissioner of Police (Vic) for leave to appeal [2004] VSCA 3R. 26 In R v Tofilau, orders originally made on 22 September 2003 by Osborn J in the Supreme Court of Victoria, Trial Division. 27 In R v Favata, orders originally made on 23 September 2003 by Teague J in the Supreme Court of Victoria, Trial Division. 28 ss 18 and 19. Kirby Concurrent with the appeals from the judgment of the Court of Appeal, which dismissed the proceedings of the Chief Commissioner29, special leave to appeal to this Court was sought, directly from the orders of the respective trial judges. Those applications were commenced against the possibility that this Court might decide that no appeal lay from the orders of the trial judges to the Court of Appeal (a jurisdictional question determined by the Court of Appeal30). Or alternatively, in case a direct appeal proved available and necessary to permit the Chief Commissioner's arguments of substance to be decided by this Court, as it was put, effectively for the first time on the submissions which the Chief Commissioner sought to advance. Before the trial judges, at the time that the Chief Commissioner's respective applications for suppression orders were first made, each of the accused persons was represented. However, there was no representation of either of the accused (who by then had been convicted of murder in each trial) when the Court of Appeal considered the Chief Commissioner's proceedings before it. This Court was told that appeals by the prisoners against their convictions are pending in the Court of Appeal. Those appeals have not been decided. Nothing in these reasons is intended to foreclose any specific complaint of either prisoner concerning the lawfulness of proceedings adopted by police in his case. This Court was informed that the prisoners were aware of these proceedings. However, they did not appear. Nor did they signify a wish to be heard upon the resolution of the issues that the Chief Commissioner asked this Court to decide. The Court of Appeal permitted The Age Company Limited, publisher of The Age newspaper in Melbourne ("the Age"), leave to appear before it as an intervener. That Court did so having regard to legal authority and to the fact that there would otherwise be no contradictor to the applications made to the Court of Appeal on behalf of the Chief Commissioner31. On the return of the appeals and the applications before this Court, the Age again appeared to contest several of the arguments of the Chief Commissioner. It provided written and oral submissions that helped to refine a number of the issues in the proceedings. It was not a party to the proceedings in this Court. Here too it appeared as an intervener. The hearing of the appeals and applications was expedited. At the conclusion of argument, the Court pronounced orders dismissing the appeals and applications and ordering the Chief Commissioner to pay the costs of the Age. 29 [2004] VSCA 3R at [48]. 30 [2004] VSCA 3R at [14]-[22]. 31 [2004] VSCA 3R at [11]. Kirby The Court delayed the termination of the operation of the subject orders for a short interval to permit the Chief Commissioner to consider and, if advised, to renew applications to the Trial Division of the Supreme Court for particular extensions of the prohibition on the publication of evidence given in the respective trials identifying police operatives in a way that might endanger their safety. However, the attempt of the Chief Commissioner to secure general orders from this Court affording prohibition for an indefinite period of publication of evidence that would identify the police methods used in the two trials was rejected32. And that was the principal objective of the Chief Commissioner in the courts below, as in this Court. The background facts The orders in issue in these proceedings concerned (to use a neutral word) evidence given in the prosecution cases brought separately against Mr Alipapa Tofilau and Mr Lorenzo Favata. Each accused was charged with murder. Each of the trials took place in the Supreme Court in September 2003. In each case the trial was by jury. In each, the accused had been the subject of a police operation designed to secure admissions and inculpating evidence. Each accused had been a prime suspect whom police believed to be responsible for the murders in question. However, in each case police had earlier concluded that they did not have sufficient evidence to establish the accused's guilt. Adapting Evidence was given in each trial by undercover operatives of the Covert Investigation Unit of Victoria Police. techniques of police investigation that had earlier been employed successfully in Canada and the United States, a "Cold Case Unit" had been established within the Homicide Squad of the Victoria Police. This unit planned strategies that were designed to win the confidence of the accused persons and thereby to procure confessions as well as evidence concerning the murder in question that, in effect, could only be known by the person who performed, or was involved in, the murder. Securing the confessional and other evidence required the undercover agents to work according to "scenarios" designed and developed to establish the conditions in which either the evidence desired by police would be forthcoming or the suspect was exculpated. It is not necessary for these reasons to describe in detail the methods used. According to evidence tendered for the Chief Commissioner, the methods used to secure the testimony tendered in the trials of Messrs Tofilau and Favata have been deployed in other Victorian cases resulting in six convictions. Three other cases of the same type were said to be awaiting trial in Victorian courts. The methodology was also relevant to undercover police operations in New 32 [2004] HCATrans 286 at [3065]-[3070]. Kirby South Wales and Western Australia. The Chief Commissioner expressed concern that, if the methods and "scenarios" described in the evidence, adduced in open court in the trials of Messrs Tofilau and Favata, became generally known to the public, through reportage of the evidence and counsel's addresses in the subject trials, this would not only diminish the prospects of the successful use of such techniques to clear up unsolved serious crime in the future. It could also endanger the safety of undercover agents, including those presently engaged in covert operations of this kind. By publicity in the general media, knowledge of the new methods would spread in ways less likely to occur than through discussion of the acceptability of such police methods in judicial reasons33; legal and academic literature34; word of mouth descriptions of the comparatively few spectators who might have attended the Tofilau and Favata trials; or in-prison discussions undermining the effectiveness and safety of the otherwise promising police techniques35. In each case, therefore (and apparently in other cases in other States where the methods have been deployed), applications were made for suppression orders designed to prevent general reportage of that part of the evidence at the trial, or of addresses concerning such evidence, that would publicise the methods with the consequences that the Chief Commissioner sought to avoid. The first relevant order was made by Osborn J on 22 September 2003 in relation to the trial of Mr Tofilau. It was made following a hearing conducted in part in closed court. The order was in the following terms (omitting the names of specified witnesses): "1. [Pursuant to s 18(1) of the Supreme Court Act] [p]ublication by print or electronic means of the following material be prohibited: photographic or any other images of the undercover operatives; a report of any part of the proceedings or information derived therefrom which could identify any of the undercover operatives as members of the Victoria Police; 33 cf R v Swaffield (1998) 192 CLR 159; R v Mentuck [2001] 3 SCR 442; R v ONE [2001] 3 SCR 478. 34 eg Palmer, "Applying Swaffield: Covertly Obtained Statements and the Public Policy Discretion", (2004) 28 Criminal Law Journal 217; Bronitt, "Constitutional Rhetoric v Criminal Justice Realities: Unbalanced Responses to Terrorism?", (2003) 14 Public Law Review 76 at 79; Palmer, "Applying Swaffield Part II: Fake gangs and induced confessions", (2005) 29 Criminal Law Journal 111. 35 [2004] VSCA 3R at [42]. Kirby (iii) the names of the undercover operatives; the evidence of the witnesses *** and ***; (vii) the evidence of the witness *** save and except for the fact that a confession was made by the accused to police members on 17 March 2002 but not including any detail of police undercover methodology; details of the sixteen scenarios comprising such methodology referred to above which will be given in evidence by the aforementioned witnesses; the opening and closing addresses of Counsel insofar as they reveal the methodology disclosed by the abovenamed witnesses in relation to the sixteen scenarios; (viii) the cross-examination of the informant and any police witnesses as to the methodology referred to above; the fact of the use of any of the sixteen scenarios as an investigative tool used by the Victoria Police. This order remain in force until 10 October 2003. In the trial of Mr Favata, Teague J on 23 September 2003 made an order in substantially similar terms. Like Osborn J, his Honour declined the Chief Commissioner's request to make the order one having operation for an indefinite time. He too fixed the duration of the order by reference to the anticipated duration of the trial. The orders were later extended whilst the Chief Commissioner's applications and appeals were underway. Such extensions were designed to protect the utility of the proceedings. The decision of the Court of Appeal In the Court of Appeal the Chief Commissioner challenged the orders so made and specifically their limited periods of operation. In respect of the orders concerning the trial of Mr Tofilau, the proceedings in the Court of Appeal were commenced on 1 October 2003. According to the record, a notice of appeal bearing that date, and a summons of the same day seeking leave to appeal in the alternative, were presented to the Court of Appeal registry together with a supporting affidavit. The affidavit identified confidential evidence presented by police at the trial of Mr Tofilau and the transcript of the closed court proceedings Kirby leading to Osborn J's order. The confidential evidence was produced to the Court registry in a sealed envelope. Similar documentation was presented to the Court of Appeal registry on 7 October 2003 appealing, or applying for leave to appeal, from the order of Teague J concerning the similar evidence in Mr Favata's trial. In each matter, the documentation was intituled by reference to the proceedings between the Queen and the respective accused. The documents nominated the Chief Commissioner as "appellant" and "applicant" respectively and referred to the Supreme Court Act, s 18, under which each application for the subject orders had been made. The appeals and applications in the two cases were heard together by the Court of Appeal on 9 October 2003. It was undisputed that the argument in that Court occupied, in all, an hour and a half. In this Court, the Chief Commissioner was permitted to rely on an affidavit by her solicitor concerning what then followed. This evidence was tendered to establish the complaint which the Chief Commissioner made to this Court concerning an alleged want of procedural fairness, said to have arisen in the course adopted by the Court of Appeal in disposing of the proceedings. It will be necessary to return to the procedure adopted36. For the present, it will be assumed that it was permissible and that the evidence is available for consideration by this Court. According the solicitor's affidavit, on 8 December 2003, a memorandum was forwarded by counsel for the Chief Commissioner to the Court of Appeal which, it was said, made it clear that the Chief Commissioner assumed that the issue to be decided by the Court of Appeal was restricted to "the question of jurisdiction". In the submissions signed by counsel, the Chief Commissioner submitted: "Nor does [the Chief Commissioner] wish at this stage to make submissions on the substantive issues which will be raised in the Appeal if the Court either assumes jurisdiction or grants leave to appeal. Those substantive issues are complex and may require analysis of interstate and overseas authorities. ... These submissions are limited to the reasons why leave to appeal should be granted". In addition to the foregoing, further affidavits by the solicitor for the Chief Commissioner and by a police witness, each dated 10 December 2003, were filed in the Court of Appeal registry. The further affidavit of the solicitor referred to communications with police undercover units in other States of Australia; 36 See below at [69]-[72]. Kirby confirmed that methods similar to those used in the instant cases were being deployed in those States; and reported "similar concerns to those expressed by Victoria Police, should the media be permitted to reveal details of the technique [of using undercover scenario investigations]". The affidavit also foreshadowed the likelihood that an application would be made to this Court for special leave to appeal should the decision of the Court of Appeal prove adverse to the Chief Commissioner. No foundation, in the Rules of Court or in any leave expressly granted by the Court of Appeal, was cited for the course adopted in filing these supplementary materials. Whether they reached the judges of the Court of Appeal is unknown. They were not specifically referred to in the Court of Appeal's reasons, published when its orders were pronounced. This Court has deprecated such actions in respect of its own hearings37. Where leave has not been given publicly for supplementary submissions and evidence, the provision of such material to court registries without permission of the court, publicly signified, is a derogation from the principle of the open administration of justice. It should not occur. If new points of importance arise in the case whilst a matter stands for judgment, the proper course (unless statute or court rules permit otherwise) is for the proceeding to be relisted so that an application to enlarge the record can be made and determined in open court. Had that course been followed in the present proceeding, it is likely that the apparent misapprehension on the part of those representing the Chief Commissioner would have been cleared up. The later complaint of procedural unfairness might then have been avoided. In response to the supplementary submission and affidavits of the Chief Commissioner that were served on it, the Age filed its own "supplementary note" in the Court of Appeal registry on 15 December 2003. This signified that it did "not wish to make any further submissions on the question of jurisdiction or the application for leave to appeal". However, the Age indicated that it wished to "make submissions [in the event that leave to appeal were granted] on the substantive issues in the appeal in response to [the affidavits filed by the Chief Commissioner] including [those] sworn on 10 December 2003". The Age also foreshadowed that, in the event that leave to appeal were granted, it would seek leave to cross-appeal for orders that the orders made in each case be limited to the names or photographic or other images of the undercover police operatives 37 Stuart v The Queen (1959) 101 CLR 1 at 10. ("We think we should add that while these reasons were in preparation a communication was made on behalf of the Crown to the Principal Registrar of material said to bear on the prisoner's capacity to understand English. This communication we have entirely ignored and we do not think it ought to have been made.") Kirby involved and reports of any part of the proceedings that would identify those persons. The Chief Commissioner contended that these submissions, on the part of the Age, indicated the expectation of the intervener in the Court of Appeal that leave to appeal would be decided by that Court separately from, and anterior to, the consideration of "the substantive issues in the appeal". That, it was suggested, was what the Chief Commissioner had also anticipated. This is not, however, the way the Court of Appeal decided the proceedings. Its reasons were published and orders made on 12 February 2004. The title sheet to the unanimous decision of the Court (Winneke P, Ormiston and Vincent JJA) discloses the approach. The case is described as "In the matter of an application by Chief Commissioner of Police (Vic) for leave to appeal". After outlining the course of the proceeding and (in general terms) the techniques involved in the activities of the undercover operatives deployed in relation to the respective cases of Messrs Tofilau and Favata38, the greater part of the reasons of the Court of Appeal was devoted to the preliminary question of whether (as the Chief Commissioner asserted), she was entitled to appeal as of right against the suppression orders; whether (as the Age asserted) the Chief Commissioner required the leave of the Court to appeal; or whether no appeal lay to the Court of Appeal in such a case39. Without finally resolving Ultimately, for reasons that will be described below, the Court of Appeal concluded that it had jurisdiction to determine the Chief Commissioner's proceedings. the Chief Commissioner had an appeal as of right or could appeal only if leave were granted40, it is clear that the Court of Appeal proceeded to treat the matter as an application for leave. The final order made indicates as much41; as does the title to the Court's reasons. issue whether the Subject to any legislative provisions governing court procedures or any considerations of procedural fairness raised by the course of proceedings, it is common for a court, disposing of leave or special leave, to do so with appropriate consideration of the legal and factual merits of the applicant's case. Where the court reaches a clear view that the applicant's case lacks sufficient merit (and is therefore likely, or bound, to fail if leave were granted), a refusal of leave ordinarily follows. To grant leave in such circumstances would be futile, 38 [2004] VSCA 3R at [8]. 39 [2004] VSCA 3R at [14]-[22]. 40 See eg [2004] VSCA 3R at [22]. 41 [2004] VSCA 3R at [48]. ("[T]he applications should be dismissed.") Kirby involving pointless costs to the applicant (and any respondent parties) and the public costs involved in an extended appellate hearing. In this case the Court of Appeal said that it was prepared, for the purpose of its disposition, to assume that counsel for the Chief Commissioner was correct in his submissions (which were that the Chief Commissioner had a right of appeal or, at least, to seek leave to appeal). The Court of Appeal said42: "[W]e are prepared to assume (without deciding) [this] for the purpose of enabling us to determine the substantive issue debated before us – namely whether the trial judges were in error in making the limited suppression orders which they did. We are prepared to do this because we have reached a firm and united view upon that issue." In coming to that view, and giving it effect in the way that it did, in the sequence of events described, the Chief Commissioner submitted that the Court of Appeal had deprived her of procedural fairness. Specifically, it had disposed of the proceedings on the footing that there was an "appeal" without affording the Chief Commissioner the right to present full argument as on the return of an appeal. It had expressly assumed that there was an "appeal"; but it had treated the matter, in effect, as no more than an application for leave to appeal. It had failed to respond to the suggested indications in the initial hearing and the requests in the subsequent communication in December 2003, showing that the Chief Commissioner wished to be heard separately and upon additional materials, before the substantive question was decided. And it had deprived itself (in a matter of importance to the Chief Commissioner, other police and the community) of full argument on a point of large significance for the administration of justice in the particular cases and more generally43. The Age contested the suggested breach of procedural fairness alleged by the Chief Commissioner. It had consistently submitted to the Court of Appeal that the only entitlement of the Chief Commissioner to engage the jurisdiction of that Court was if leave to appeal were granted. Supported by the summary of the Chief Commissioner's submissions as reproduced in the reasons of the Court of Appeal44, the Age argued that the "substantive issue" in that Court had been sufficiently identified and addressed in the initial hearing. In so far as the additional submissions and evidence were pressed upon the Court of Appeal 42 [2004] VSCA 3R at [22]. 43 Moevao v Department of Labour [1980] 1 NZLR 464 at 481; Walton v Gardiner (1993) 177 CLR 378. See also Attorney-General v Leveller Magazine [1979] AC 44 [2004] VSCA 3R at [31]. Kirby whilst its judgment was under consideration, it was open to that Court (if it gave any consideration to the material) to conclude that there was nothing new in principle or that no reason had been shown why the Chief Commissioner should be allowed to present new and different materials at such a late stage. The applicable legislation The relevant provisions of the Supreme Court Act are ss 17, 17A, 18 and 19. So far as applicable, the sections governing the right of appeal to the Court of Appeal provide: "17. Business to be disposed of by Trial Division constituted by a Judge The Trial Division constituted by a Judge may hear and determine all matters, whether civil or criminal, not required by or under this or any other Act … to be heard and determined by the Court of Appeal. (2) Unless otherwise expressly provided by this or any other Act, an appeal lies to the Court of Appeal from any determination of the Trial Division constituted by a Judge. 17A. Restrictions on appeals (1) An order made by the Trial Division constituted by a Judge – by consent of the parties; or as to costs which are in the discretion of the Trial Division – is not subject to appeal to the Court of Appeal except by leave of the Court of Appeal or by leave of the Judge constituting the Trial Division which made the order. Except as provided in Part VI of the Crimes Act 1958, an appeal does not lie from a determination of the Trial Division constituted by a Judge made on or in relation to the trial or proposed trial of a person on indictment or presentment. Kirby (4) An appeal does not lie to the Court of Appeal – from an order allowing an extension of time for appealing from a judgment; or (b) without the leave of the Judge constituting the Trial Division or of the Court of Appeal, from a judgment or order in an interlocutory application, being a judgment or order given by the Trial Division constituted by a Judge, except in the following cases – when the liberty of the subject or the custody of minors is concerned; The reference in s 17A(3) to Pt VI of the Crimes Act 1958 (Vic) ("the Crimes Act") is a reference to the Part of that Act governing "Appeals in criminal cases [and] references on petitions for mercy". By s 567, the Crimes Act provides for a right of appeal in criminal cases. However, the right of appeal so afforded is confined by s 567 (relevantly) to an appeal by "a person convicted on indictment" or presentment. By virtue of the provisions of the Crimes Act, such a person "may appeal under this Part to the Court of Appeal". Four circumstances of appeal are specified in s 567. They are appeal: "against … conviction on any ground of appeal which involves a question of law alone"45; upon a certificate where the appeal is against conviction on a ground of appeal "which involves a question of fact alone, or a question of mixed law and fact"46; with the leave of the Court of Appeal (notwithstanding the absence of a certificate) on the lastmentioned grounds47; and with the leave of the Court of Appeal against sentence unless the sentence is one fixed by law48. Provision is also made in Pt VI of the Crimes Act for an appeal against sentence passed on a person convicted of specified serious offences brought in particular cases by the Director of Public Prosecutions49. There is no express provision in Pt VI of the Crimes Act permitting a right of appeal against an order made under s 18 of the 45 Crimes Act, s 567(a). 46 Crimes Act, s 567(b). 47 Crimes Act, s 567(c). 48 Crimes Act, s 567(d). 49 Crimes Act, s 567A. Kirby Supreme Court Act where the order is made in relation to any criminal proceeding. The provisions of the Supreme Court Act governing orders prohibiting publication of evidence are relevantly as follows: "18. Power to close proceedings to the public The Court may in the circumstances mentioned in section order that the whole or any part of a proceeding be heard in closed court; or order that only persons or classes of persons specified by it may be present during the whole or any part of a proceeding; or (c) make an order prohibiting the publication of a report of the whole or any part of a proceeding or of any information derived from a proceeding. This section applies to any proceeding, whether civil or criminal. (4) A person must not contravene an order made … under this section. Penalty: 1000 penalty units or imprisonment for 3 months. 19. Circumstances in which order may be made under section 18 The Court may make an order under section 18 if in its opinion it is necessary to do so in order not to – endanger the national or international security of Australia; prejudice the administration of justice; or endanger the physical safety of any person; Kirby The resulting issues Against this background of the history of the proceedings, the arguments of the parties and the applicable legislation, the following issues arise for consideration by this Court: The constitutional issues: Are the appeals or applications by the Chief Commissioner competent, in accordance with the Constitution, to engage the appellate jurisdiction and power of this Court? The appeal hearing issue: If so, did the Court of Appeal err in failing or omitting to conclude that the Chief Commissioner had an appeal to it as of right against the orders respectively made in the Trial Division of the Supreme Court by Osborn J and Teague J? Did the Court of Appeal err in failing or omitting to hear such appeals as required by law? The procedural fairness issue: Did the Court of Appeal err in failing to accord procedural fairness (natural justice) to the Chief Commissioner when it disposed of the substance of her proposed appeal as an application for leave to appeal without affording a full opportunity to her to present evidence and argument in support of her contentions? The direct approach issue: Having regard to the answers to the foregoing, is special leave required and should it be granted to the Chief Commissioner, to appeal directly to this Court from the orders of the judges in the Trial Division of the Supreme Court of Victoria? Should any time default in that regard be cured so as to permit special leave to be granted and the appeals to be disposed of on their merits? Three constitutional questions Questions of jurisdiction and power: In the course of argument in this Court a number of constitutional questions were raised by the Court that had either not been noticed, or not sufficiently identified50, prior to the hearing. It is necessary to mention these questions although the Court had only limited submissions upon them. This is because they concern the jurisdiction and powers of this Court in the present proceedings. Although neither the Chief Commissioner nor the Age argued a want of jurisdiction – indeed each asserted that jurisdiction existed – it is the first rule of every court, where a real question is raised as to its jurisdiction and powers (or as to the exercise thereof), that the court must satisfy itself that the jurisdiction exists and that the powers may be exercised. 50 With appropriate notices under the Judiciary Act 1903 (Cth), s 78B. Kirby Reception of evidence as to the proceedings: One of the constitutional questions has already been mentioned in passing. It can be disposed of with relative ease. It concerns the admissibility in this Court of affidavits read on behalf of the Chief Commissioner, designed to show what occurred in the Court of Appeal as relevant to the suggested unfairness of that Court's action in proceeding to dispose of the substance of the Commissioner's submissions. This Court has held51, and recently reaffirmed52, that the "appeals" provided for in s 73 of the Constitution are strict appeals. They require the exercise by this Court of its appellate jurisdiction based on the record of the court from which the appeal comes53. Upon this footing, this Court has refused to permit fresh evidence to be tendered once the appellate jurisdiction of the Court is engaged. Opinions have been expressed that have questioned this holding54. However, the authority of the Court was not questioned in these proceedings. It should be taken to apply to them. Is the affidavit that describes the conduct of the proceedings in the courts below new evidence in the sense forbidden by the foregoing authority? Or does it represent nothing more than an attempt to express and describe the record of the earlier proceedings in a way equivalent to a verbatim elaborated transcript of what took place when those proceedings were before the Supreme Court of Victoria? Some intermediate appellate and trial courts have verbatim transcripts of argument in all or most cases. Where these exist it is relatively easy to examine the way in which a case was presented. Such transcripts are commonly treated as part of the record.55 As such, they would be available to this Court to assist in an otherwise admissible complaint of procedural unfairness. Evidence beyond the record, to supplement the transcript as recorded by the official shorthand writer has been received by this Court in cases where the record is imperfect or incomplete: see Government Insurance Office of NSW v 51 Victorian Stevedoring and General Contracting Co Pty Ltd and Meakes v Dignan (1931) 46 CLR 73 at 85, 87, 107-110, 112-113; Mickelberg v The Queen (1989) 167 CLR 259 at 265-271, 274-275, 297-298. 52 Eastman v The Queen (2000) 203 CLR 1 at 12-13 [17], 26 [78], 35 [111], 63 [190], 53 Mickelberg (1989) 167 CLR 259; Eastman (2000) 203 CLR 1. 54 Eastman (2000) 203 CLR 1 at 93 [276]-[277], 123 [369]-[370]; Mickelberg (1989) 167 CLR 259 at 282-284, 288. 55 cf Craig v South Australia (1995) 184 CLR 136 at 180-183. Kirby Fredrichberg56. This approach was noted, without disapproval, in Eastman v The Queen57. As finally tendered, I do not regard the substance of the affidavit of the solicitor for the Chief Commissioner, concerning what occurred in the Court of Appeal, as understood by that solicitor, as offending against the established constitutional rule. It permissibly elaborates the record. But it must be read with the rest of the record, including the statements in the Court of Appeal's reasons concerning the matters that were submitted to that Court during argument on the hearing. Procedural fairness and a superior court: A second question raised by this Court during argument is whether, in the exercise of the appellate jurisdiction of this Court, it is open to a party to challenge a judgment or orders of a State Supreme Court on grounds that contend that those orders are affected by procedural unfairness and liable to be set aside on that basis. Traditionally, the judges of superior courts, such as a State Supreme Court, were not liable to the prerogative remedies addressed to inferior courts on the basis that they had acted outside their jurisdiction by failing to observe the requirement of procedural fairness58. A possible question was raised as to whether that limitation controlled the appellate jurisdiction of this Court in such a way as to exclude relief for procedural unfairness on the part of a superior court of record, such as the Supreme Court of Victoria. This issue was not argued at any length. That was because there was no party with an interest to do so. However, it is sufficient to say that the appellate jurisdiction of this Court, deriving as it does from the Constitution, should be given the widest possible ambit to cure injustices, procedural as well as substantive, in a Supreme Court as in other courts without distinction. This 56 (1968) 118 CLR 403 at 410, 416-417, 422-423. 57 (2000) 203 CLR 1 at 59 [182], 90 fn 354. 58 R v Commonwealth Court of Conciliation and Arbitration; Ex parte Ozone Theatres (Aust) Ltd (1949) 78 CLR 389 at 399; R v Metal Trades Employers' Association; Ex parte Amalgamated Engineering Union, Australian Section (1951) 82 CLR 208 at 241; cf R v Gray; Ex parte Marsh (1985) 157 CLR 351 at 393. It has long been established that the constitutional writs provided for in s 75(v) of the Constitution may be issued to officers of the Commonwealth who are also superior court judges in courts created by the Parliament, where they exceed jurisdiction. See the Tramways Case [No 1] (1914) 18 CLR 54 at 62, 66-67, 82-83, 86. Such writs do not, however, apply to a judge of a State court exercising federal jurisdiction vested in that court: R v Murray and Cormie; Ex parte The Commonwealth (1916) 22 CLR 437 at 452-453, 464, 471. Kirby Court has previously assumed as much.59 I will do so for the purpose of these proceedings. Engaging a constitutional "appeal": Thirdly, and more troubling, is a point also raised by the Court during argument concerning whether the subject judgment and order of the Court of Appeal (and the orders of the trial judges) in the Supreme Court of Victoria in this case are "judgments … [or] orders" within s 73 of the Constitution. And whether the controversy tendered by the appeals of the Chief Commissioner to this Court and her applications for special leave tender a "matter" apt for determination by this Court in the exercise of the judicial power of the Commonwealth. The difficulty in this third constitutional point is highlighted by the fact that the application of the Chief Commissioner, both in the Trial Division of the Supreme Court and in the Court of Appeal, had no contesting party in the ordinary sense. The Age provided a contradictor for some of the contentions of the Chief Commissioner. But the Age's interest was focused, naturally enough, on the potential effect of any over-wide suppression order upon the exercise of its newspaper's asserted right to report the particular criminal trials and to discuss matters of general significance arising from them. As such, the Age was only peripherally concerned in the issue of the jurisdiction of the Court of Appeal. It did not have a general brief, or possibly the standing, to advance all of the public interest considerations that were presented by the Chief Commissioner's applications. Perhaps significantly, by the time the Court of Appeal came to deliver its reasons, and to pronounce its judgment and orders, the parties initially named in the title to the process that originally invoked that Court's jurisdiction (namely the Queen and the two accused persons by then convicted prisoners) were omitted. Nor was the Age named as a party. Being content with the order of the Court of Appeal, it did not seek to exercise a party's rights in this Court. It did not seek to appeal or cross- appeal. It did not need to. It was satisfied with the Court of Appeal's dispositions. It therefore remained an intervener. The cardinal rule for the exercise of the judicial power of the Commonwealth was stated by this Court in its early days in In re Judiciary and Navigation Acts60. It was not questioned in these proceedings. The Court there 59 Pantorno v The Queen (1989) 166 CLR 466 at 476, 483 (setting aside a decision of the Supreme Court of Victoria (Court of Criminal Appeal) on the grounds that the Court erred in law by failing to accord the accused procedural fairness). See also R v Lewis (1988) 165 CLR 12 at 16-17. 60 (1921) 29 CLR 257. Kirby refused to give an advisory opinion on whether various sections and schedules of the Navigation Act 1912 (Cth) were valid enactments of the Federal Parliament. It established the rule that the legislature61: "cannot authorize this Court to make a declaration of the law divorced from any attempt to administer that law. … [W]e can find nothing in Chapter III of the Constitution to lend colour to the view that Parliament can confer power or jurisdiction upon the High Court to determine abstract questions of law without the right or duty of any body or person being involved". In Mellifont v Attorney-General (Q)62, this Court, in the joint reasons63, pointed out that the foregoing passage contains two critical concepts: "One is the notion of an abstract question of law not involving the right or duty of any body or person; the second is the making of a declaration of law divorced or dissociated from any attempt to administer it". These possible problems of a constitutional character were likewise not fully argued. In the absence of such argument, I am unconvinced that they present a barrier to the exercise of the appellate jurisdiction of this Court. There is no doubt that, subject to the Constitution, the courts below made orders which, pursuant to the Supreme Court Act were binding according to their terms until set aside or terminated. Each of the orders, whilst they remained in force, could give rise in case of breach to proceedings for a penalty and, possibly, for prosecution for contempt of court. Provision for the orders made is expressly envisaged by ss 18 and 19 of the Supreme Court Act. The Chief Commissioner was a proper person to enliven the jurisdiction of the Supreme Court of Victoria to make such orders, having regard to the terms of s 19, especially pars (b) and (c). The orders were sought in connection with two extant criminal trials, involving named accused and identified witnesses. I do not believe that the determination of the Chief Commissioner's appeal involves a decision on an abstract question of law devoid of the right or duty of the bodies and persons to whom the orders under s 18 of the Supreme Court Act were addressed. Far from being divorced or dissociated from the attempt to administer the law, the orders are closely connected with the administration of criminal justice in two criminal trials. 61 (1921) 29 CLR 257 at 266-267. 62 (1991) 173 CLR 289 at 303. 63 Mason CJ, Deane, Dawson, Gaudron and McHugh JJ. Kirby In particular, the protection of the identity of undercover police agents who gave evidence in the trials is a legitimate and a highly practical and important purpose of the administration of criminal justice. In this way, the possible constitutional difficulty presented during argument is answered sufficiently to permit the remaining questions to be decided in these proceedings. The appearance of the Age, as intervener, and the breadth and assistance of the arguments presented by the Age helped, in part, to overcome possible constitutional problems that might have arisen had the proceedings in this Court progressed entirely ex parte. This resolution of the constitutional questions, by reference to the close interrelationship of the judgment and orders made by the courts below and the substantive trials of the accused persons is also relevant to the jurisdiction of the Court of Appeal. It gives emphasis to the essential connection between the suppression orders in issue and the criminal trials to which those orders related. The jurisdiction of the Court of Appeal Determining jurisdiction: Determining the jurisdiction of the Court of Appeal was potentially the Chief Commissioner required leave to appeal (as the Age asserted) that fact would affect the character of the hearing and the conduct of the hearing and the manner of its disposition. these proceedings. important There was no contest that the respective trial judges had the jurisdiction and power to hear and determine the applications made by the Chief Commissioner that the hearing of part of the proceedings before them, in the respective criminal trials of Messrs Tofilau and Favata, should take place in closed court64. Likewise, it was not disputed that the judges had the jurisdiction and power to make orders prohibiting the publication of a report "of the whole or any part of a proceeding or of any information derived from a proceeding"65. Subject to what follows, the orders made were not within the categories expressly identified in the Supreme Court Act as requiring leave to appeal from the Court of Appeal or from the judge constituting the Trial Division66. Nor were the orders within the categories in respect of which it is provided that an appeal does not lie at all to the Court of Appeal67. In one trial, the Chief Commissioner 64 Supreme Court Act, ss 17(1) and 18(1)(a). 65 Supreme Court Act, ss 17(1) and 18(1)(c). 66 Supreme Court Act, s 17A(1), (2), (3A) and (4)(b). 67 Supreme Court Act, s 17A(4)(a) and (6). Kirby had requested the trial judge to reserve the orders "for the consideration of the Court of Appeal"68. However, the trial judge refused this request, considering that it was his duty to decide the matter for himself69. A similar request was not made before the other judge. Appeal as of right?: The Chief Commissioner's argument that a right of appeal to the Court of Appeal existed in this case depended, in part, upon the language of s 17(2) of the Supreme Court Act; in part, upon the history and suggested purpose of the appeal provisions in that Act; and, in part, on considerations of general principle concerning the wide interpretation of the powers conferred by statute on courts of general jurisdiction, such as the Supreme Court70. In essence, the Chief Commissioner submitted that the suppression orders made by the judges in the Trial Division were distinct and sui generis. They were made in the exercise of the Supreme Court's powers, expressly conferred on it by the Parliament of Victoria71. Although the conferral of such powers envisaged a "proceeding, whether civil or criminal", that was already before the Court72 the order could (as in the present cases) be sought and obtained by a non- party in defence of the statutory interests nominated73. In this way, such orders stood apart from the "proceeding" in question. They were not interlocutory to such proceedings in the normal sense. There is no doubt that s 17(2) of the Supreme Court Act would permit an appeal from the "determination" of the Trial Division constituted by a judge under s 18 of the Supreme Court Act, subject to the opening words of that sub- section ("unless otherwise expressly provided by this or any other Act"). As this in Roy Morgan Research Centre Pty Ltd v Court unanimously held Commissioner of State Revenue (Vict)74, the choice of the word "determination" 68 Supreme Court Act, s 17B(2). 69 Transcript of argument R v Tofilau, 22 September 2003 at 5-6, 15 per Osborn J. 70 See eg Electric Light and Power Supply Corporation Ltd v Electricity Commission of NSW (1956) 94 CLR 554 at 560. See also Roy Morgan Research Centre Pty Ltd v Commissioner of State Revenue (Vict) (2001) 207 CLR 72 at 78 [11], 91 [53]. 71 Supreme Court Act ss 18(1) and 19. 72 Supreme Court Act s 18(2). 73 Supreme Court Act s 19. 74 (2001) 207 CLR 72. Kirby in s 17(1) of the Supreme Court Act was clearly intended to embrace "a wide variety of judicial decisions"75. All of the considerations mentioned in Roy Morgan support the proposition that prima facie a "determination", in the form of an order under s 18 of the Supreme Court Act, potentially engages the appellate jurisdiction of the Court of Appeal, subject only to express exclusions. The history of the amendments to the appeal provisions in the Supreme Court Act were set out, as they stood to that date, in this Court's decision in Smith v The Queen76. As was decided in that case, so in this. The critical words are the words of exception. The crucial question is not whether the "determination" of the primary judge enlivens an appellate right. It is whether the express exclusions take the case out of the category of appeal as of right, obliging consideration of whether an appeal lies by leave or not at all. It follows that the important words in the present case are those that qualify the facility provided by s 17(2) of the Supreme Court Act ("unless otherwise expressly provided by this or any other Act") and the words appearing in s 17A(3) (excluding appeal "from a determination of the Trial Division constituted by a Judge made on or in relation to the trial or proposed trial of a person on indictment or presentment"). In the latter case, the only appeal that lies to the Court of Appeal (except as otherwise expressly provided) is that provided in Pt VI of the Crimes Act. In Smith, this Court held that the provision which is now s 17A(3) excluded an appeal by the Crown against an order permanently staying a criminal prosecution. The reason for the language of exclusion in the provision was explained in the joint reasons in that case77: "[I]t can hardly be assumed that [the Court] would have concluded that the Crown had a right of appeal against any ruling made against it at or before the trial – a right not shared by an accused – merely because it had no right of appeal under Pt VI of the Crimes Act. It would appear that s 14(3) 75 (2001) 207 CLR 72 at 78 [10], 87 [38]; cf The Commonwealth v Bank of NSW (1949) 79 CLR 497 at 625; [1950] AC 235 at 294 and Australian Consolidated Press Ltd v Uren (1967) 117 CLR 221 at 228; [1969] 1 AC 590 at 630 where the width of the word "decision" in s 74 of the Constitution is described. 76 (1994) 181 CLR 338 at 344-345. See also [2004] VSCA 3R at [14]-[17]. The words now appearing in s 17A(2) were then in s 42(2) of the Supreme Court Act, with reference to "the Full Court" in the place of "the Court of Appeal", as now appearing. 77 (1994) 181 CLR 338 at 346 per Mason CJ, Dawson, Gaudron and McHugh JJ. Kirby was intended to avoid the fragmentation of criminal trials by appeals brought from rulings before or during the course of a trial, whilst allowing appeals where there was a conviction … ." The same consideration applies to these proceedings to explain the relevantly identical terms of s 17A(3) of the Supreme Court Act as now appearing. There is no reason to give those words a construction different from that provided by this Court in Smith. There is every reason to give them the same construction. The ambit of the exclusion stated in s 17A(3) is a deliberately wide one. The scope of the word "determination" has already been mentioned. Equally important is the adjectival clause of place ("made on or in relation to the trial or All that is required to engage s 17A(3) is that the proposed trial"). "determination" in question was made "in relation to" a criminal trial to which Pt VI of the Crimes Act applies. As the Court of Appeal correctly pointed out in these proceedings, the posited connection to the trial appearing in those words is very broad. In the context of criminal trials, the legislative policy is explained by the longstanding resistance of the courts to interlocutory appeals that interrupt the course of criminal proceedings78. The foregoing is also the approach that the Court of Appeal has taken in decisions after Smith and prior to this one79. Moreover, as the Court of Appeal observed in the present case, it is what is required by the clear language of the express exclusion stated in s 17A(3) of the Supreme Court Act as explained in Smith. Nothing in Roy Morgan suggests a different conclusion. It is impossible to conclude that the provision of s 17A(3) of the Supreme Court Act is other than an "express provision" within s 17(2) excluding an appeal as of right from the "determinations" made by the judges of the Trial Division in this case. Appeal by leave?: This conclusion excludes the operation of the general provision of s 17(2) otherwise affording an appeal as of right in cases of this kind. It leaves only the question whether, notwithstanding such express provision, appeals "in relation to" a trial, or proposed trial, of a person on 78 [2004] VSCA 3R at [16]-[17]. See also Barton v The Queen (1980) 147 CLR 75 at 108; Sankey v Whitlam (1978) 142 CLR 1 at 25-26, 82; R v Elliott (1996) 185 CLR 79 See eg Victoria Legal Aid v Lewis [1998] 4 VR 517. The Chief Commissioner argued that Lewis was wrongly decided having regard to the fact that s 17(2) of the Supreme Court Act was inserted in 1984 to provide a right of appeal where none had previously existed; cf Fernandez v DPP (2002) 5 VR 374 at 380. This Court did not consider this argument persuasive in Smith (1994) 181 CLR 338 at 345. Kirby indictment or presentment as provided in Pt VI of the Crimes Act80, might be brought from the orders of the trial judges made under s 18 of the Supreme Court Act by leave of the Court of Appeal. The answer to that question is also governed by the express provision "otherwise" in the Supreme Court Act which provides that, subject to two exceptions not presently relevant, no appeal lies from an "order in an interlocutory application" within s 17A(4) of that Act without the leave of the judge constituting the Trial Division or of the Court of Appeal. By its terms, s 18 of the Supreme Court Act envisages the making of "orders". But are the subject orders "interlocutory" in the sense used in s 17A(4)? And if they are interlocutory within the meaning of that sub-section, is it open to the Chief Commissioner to apply for leave to appeal against those orders notwithstanding that they fall within the exclusionary provision of s 17A(3)? In Salter Rex & Co v Ghosh81, Lord Denning MR remarked that the answer to the question whether an order was "final" or "interlocutory" was so uncertain that "the only thing for practitioners to do is to look up the practice books and see what has been decided on the point". Where a new case arises, he cautioned, judges must do "the best we can with it". There was in his Lordship's opinion "no other way". In the case books, a dispute existed as to whether, for the purpose of this classification, the court looked at the practical consequences of the determination in question or at the nature of the application made and its legal effect. This Court has preferred the latter approach82. In Licul v Corney83 Gibbs J, although dissenting in the result, accurately described the approach to be taken84: "The distinction between final and interlocutory judgments is not always easy to draw and there has been disagreement as to the test by which the question whether a judgment is final or interlocutory is to be determined. One view … is that the test depends on the nature of the application made 80 ss 567, 567A. 81 [1971] 2 QB 597 at 601; cf Dousi v Colgate Palmolive Pty Ltd (1987) 9 NSWLR 82 Carr v Finance Corporation of Australia Ltd [No 1] (1981) 147 CLR 246 at 248, 254, 256-257; Sanofi v Parke Davis Pty Ltd [No 1] (1982) 149 CLR 147 at 153. 83 (1976) 180 CLR 213. 84 (1976) 180 CLR 213 at 225. Kirby to the Court. The other view which, since Hall v Nominal Defendant85 should, I think, be regarded as established in Australia, depends on the nature of the order made; the test is: Does the judgment or order, as made, finally dispose of the rights of the parties?" In the present case, the order made under s 18 of the Supreme Court Act did not finally dispose of the Chief Commissioner's rights, on new and different evidence, to apply again for an order under s 18. When attention is paid to the legal effect and classification of the order sought, such order was therefore interlocutory. The fact that the Chief Commissioner was not a party to the original criminal proceedings, although the proceedings were brought "in relation to the trial or proposed trial of a person on indictment or presentment", also assists in that classification. The Chief Commissioner's applications obviously "relate[d] to" the trials of Messrs Tofilau and Favata. Initially they were so described in the documentation filed by her solicitors. They did not finally resolve the rights of the parties to those proceedings. They did not even finally dispose of the rights of the Chief Commissioner to the order she sought, a fact demonstrated by the numerous supplementary applications made whilst the present proceedings were progressing through the courts. Even if the orders are interlocutory, and therefore fall within s 17A(4), it is not clear from the text of the provision whether it is still open to the Chief Commissioner to apply for leave to appeal under that section notwithstanding that the orders are also caught by s 17A(3). The relationship between ss 17A(3) and 17A(4) was not addressed by the parties in their submissions. I therefore proceed on the assumption, without deciding the point, that even if an order is excluded by s 17A(3), an appeal by leave under s 17A(4) may still be available in the alternative. Conclusion: leave required: It follows that the correct construction of the Supreme Court Act and the Court of Appeal's own reasoning ought to have led it to a conclusion that an appeal against the orders of the trial judges lay to it, but only by leave. Obviously enough, this is what, by its ultimate disposition, the Court of Appeal eventually concluded. It dismissed the "applications", that is, for leave. It made no order in relation to the purported "appeals" which, by inference, it decided were not available to the Chief Commissioner as of right. 85 (1966) 117 CLR 423. Kirby It might have been preferable for the Court of Appeal to have resolved the point expressly in its reasons instead of leaving its conclusion to inference86. The course that it took, and some of its consequential reasons, led the Chief Commissioner to believe that the Court accepted the existence of a right of appeal which it then proceeded to determine, as such, without a further hearing of such appeal because it had "reached a firm and united view upon that issue"87. However, in law, leave was required. The order made, the substantial reasoning and the title to the Court of Appeal's reasons and order all sufficiently indicate that that was its final conclusion. In so concluding, the Court of Appeal did not err. No occasion therefore arises on this ground for this Court to correct its order. Procedural fairness and the substantive disposition Establishing the alleged unfairness: The foregoing conclusion has consequences for the Chief Commissioner's argument that the course adopted by the Court of Appeal in disposing of the proceedings before it by reference to "the substantive issue debated before us"88, involved a breach of the requirements of procedural fairness. If the legal character of the proceedings before the Court of Appeal was, as I would hold, applications by the Chief Commissioner upon summonses for leave to appeal against the duration of the orders made by the trial judges under s 18 of the Supreme Court Act, it was proper and orthodox for the Court of Appeal to consider the substantive determination of the applications made by the trial judges in deciding those summonses. Such considerations are commonly given weight in disposing of leave applications. Although the special leave jurisdiction of this Court is somewhat different, and raises distinct and national considerations89 (and typically now follows distinct procedures) it is very common for this Court, in exercising its special leave powers, to give consideration to the substantive merits of the applicant's argument, although alone they will not suffice to attract leave90. 86 Cuthbertson v Hobart Corporation (1921) 30 CLR 16 at 25; Witness v Marsden (2000) 49 NSWLR 429 at 448 per Heydon JA. 87 [2004] VSCA 3R at [22]. 88 [2004] VSCA 3R at [22]. 89 See Judiciary Act 1903 (Cth), s 35A. 90 See eg Director of Public Prosecutions v United Telecasters Sydney Ltd (1990) 168 CLR 594 at 602. Kirby It is a serious matter to contend that a court, such as the Court of Appeal of a Supreme Court of a State, has denied a party procedural fairness. The evidentiary burden of establishing that complaint rests on the litigant who makes it. Occasionally, a mistake or oversight will be proved warranting relief on those grounds. But before giving such relief, it is necessary that the foundation be established. In the present case, even when the affidavit material tendered to enlarge the record is considered, the complaint of unfairness in the procedures adopted by the Court of Appeal is not shown. At the most, what appears to have happened is that an assumption was made, amongst those representing the Chief Commissioner, that the Court of Appeal would adopt a two-stage approach to the hearing and invite the parties to return with added submissions on "the substantive issue". For several reasons, that assumption was not, and is not, justified in these proceedings. issue ought The focus on jurisdiction: First, the attention of the Court of Appeal to the jurisdictional the Chief Commissioner to the possibility that one outcome could be a rejection of the asserted right to appeal and a holding that, at most, the Chief Commissioner had the alternative entitlement asserted by her summonses, namely the right to seek leave to appeal. those representing to have alerted In the ordinary course of appellate litigation before a court as busy as the Court of Appeal of Victoria, it would be common for the Court to dispose, in the one hearing, of both a jurisdictional question and, if leave were required, the leave question. A well-represented litigant, such as the Chief Commissioner, would have to be prepared for that eventuality. If a different or special course of hearings was proposed or desired, it would have been necessary to make an application for such a course in the clearest of terms, supported by good reasons. The record and evidence before this Court fall far short of demonstrating that any such request was made, certainly before the post-hearing supplementary submission and evidence transmitted to the Court of Appeal registry in December Submissions on the substantive question: Secondly, it is clear from the reasons of the Court of Appeal that, during the oral hearing, the Chief Commissioner and the Age each addressed detailed submissions to the substantive question relating to the "continued suppression from public disclosure of the use of a technique to secure admissions from suspected persons"91. The Court of Appeal set out, in summary form, the nature of those submissions. As recorded, they were addressed to the utility, success and effectiveness of the police techniques adopted; the use being made of them by police in Victoria and other Australian States; the suggested diminution in their 91 [2004] VSCA 3R at [31]. Kirby utility once publicity was given to what had happened; and the special risks to which the undercover operatives were exposed given that the subjects of the It was not disputed that such submissions had been made or that the submissions had not referred to the decisions of the Supreme Court of Canada in R v Mentuck93 and R v ONE94, examined in the Court of Appeal's reasons95. The close similarity of the issues considered in the Canadian cases and the police methods the subject of the Chief Commissioner's applications, made it inevitable (especially in an appeal requiring leave) that attention would be addressed by the Court of Appeal to such evidence as was available to show the similarities and differences of the Canadian situation. The factual features of the techniques were bound to be evaluated, as was the difference potentially presented by the reliance of the Canadian court on the provisions of the Canadian Charter of Rights and Freedoms, a matter expressly referred to by the Court of Appeal96. Expedition and economy of proceedings: Thirdly, an obviously relevant consideration was the urgency of a speedy decision in the proceedings. The case had come before the Court of Appeal, as later this Court, with a high measure of expedition. So much was required by the nature of the proceedings which potentially affected the rights and interests of the accused and people in a like position but also affected the public interest. It was chiefly the public's interest in the open conduct of court proceedings, specifically in criminal trials, that had caused the decisions of both judges in the Trial Division to limit the duration of their orders, initially to the expected hearing of each trial. The clear authority of this Court97, of other final courts98 and of other Australian courts99 lays consistent emphasis on the fact that the principle of open 92 [2004] VSCA 3R at [31]. 93 [2001] 3 SCR 442. 94 [2001] 3 SCR 478. 95 [2004] VSCA 3R at [24], [44]. 96 [2004] VSCA 3R at [44] fn 38. 97 Russell v Russell (1976) 134 CLR 495 at 520. 98 Scott v Scott [1913] AC 417 at 435-437; R v Mentuck [2001] 3 SCR 442 at 472- Kirby justice is deeply entrenched in our law. It is not an absolute principle. Subject to the Constitution, it may be modified by legislation, such as that enacted in the form of the Supreme Court Act, ss 18 and 19. But the resolution of claims for the closure of courts during criminal trials (even the exclusion from part of them of counsel for the accused where the accused is also absent)100 and limitations imposed by judicial orders on reportage of proceedings conducted in open court remain wholly exceptional in this country. The determination of their extent and lawfulness was a matter requiring prompt judicial decision in these proceedings. On the face of things, it was not a matter that could be allowed to proceed languidly in a series of interlocutory steps, if that could be avoided. This was so particularly because, pending final resolution and contrary to the initial orders of each of the judges in the Trial Division of the Supreme Court, the restriction on publication had been extended whilst the proceedings were still current. The character of the proceedings, therefore, added to the necessity on the part of those representing the Chief Commissioner to make completely clear any request that was made for a staged timetable of hearings different from the course that might otherwise be observed. No such request was proved. Avoiding futile orders: Fourthly, it was inevitable, and proper, that, in resolving an application for leave, the Court of Appeal would turn its attention to the utility of permitting an appeal. Such considerations caused the Court of Appeal, in disposing of the applications, to address the "immense practical difficulties" presented by the arguments of the Chief Commissioner "whether considered in terms of duration [or] scope of effectiveness" of the orders sought101. It is common in disposing of an application for leave (or special leave) for the appellate court to consider whether the provision of the relief sought would 99 John Fairfax & Sons Ltd v Police Tribunal of NSW (1986) 5 NSWLR 465 at 476- 477 ("Police Tribunal Case"); Raybos Australia Pty Ltd v Jones (1985) 2 NSWLR 100 In the trial of Mr Tofilau, counsel for the Chief Commissioner asked to be heard in the absence of the defendant and counsel for the defence. The accused's counsel did not oppose that course but he had earlier indicated that he opposed "suppression of the methodology" and "of all publicity", which he described as "inconceivable". See transcript R v Tofilau, 22 September 2003 at 7. In the trial of Mr Favata, his counsel likewise announced that he was "instructed to oppose any ban on reporting these matters that would amount to a ban on reporting the activities of the undercover police officers". He did not oppose an order protecting their names. See transcript, R v Favata, 23 September 2003 at 369. 101 [2004] VSCA 3R at [45]. Kirby be futile because of changing circumstances, whether of law or fact. The impossibility of ensuring that a mandatory order will be complied with has for a very long time been a factor that courts take into account when deciding whether injunctive orders should be made102. In the state of the record and evidence placed before it, there was no error on the part of the Court of Appeal in considering such matters. The possibility, indeed likelihood, that such considerations would be given attention ought to have been obvious to those representing the Chief Commissioner. Given the public reportage of North American cases concerning police methods in some ways similar to those used in the present case, the availability of such information on the internet, and the presumed discussion of the techniques used in trials and within Australian prisons, it was inevitable that leave application, the Chief Commissioner would have considerations such as those that weighed in the reasons of the Court of Appeal103: to face, on a "[T]he idea that an order of the kind sought in these cases could be thought to be effective to stop the passing on of information [including the use of methods of the kind here employed] is, if we may say so, fatuous, for the threat of punishment for contempt of such orders, even if that involved an order for imprisonment, would be of little deterrent effect on persons serving extensive terms for murder or their colleagues"104. The Court of Appeal was clearly, and properly, open to argument concerning the need for specific and long-term protection of the identity of the undercover operatives, a course not disputed by the Age below or in this Court105. However, the Age rightly directed the Court's attention to the public interest, amongst other things, in community discussion of the tactics used by police106. 102 [2004] VSCA 3R at [45] citing Attorney-General v Colney Hatch Lunatic Asylum (1868) LR 4 Ch App 146 at 154 per Lord Hatherley LC. 103 [2004] VSCA 3R at [42]. 104 See also the comment of the Court of Appeal [2004] VSCA 3R at [42] fn 36. In her submissions, the Chief Commissioner argued that she had wished to provide further evidence to the Supreme Court on the methodology used, particularly the fact that the "targets were chosen with great care, and not from the prison population". 105 See eg Marks v Beyfus (1890) 25 QBD 494 at 498; Cain v Glass (No 2) (1985) 3 NSWLR 230 at 242-243, 247-248 (in relation to the identity of police informants). 106 [2004] VSCA 3R at [24] citing Mentuck [2001] 3 SCR 442 at [50]. Inevitably many cases have been decided at trial and on appeal in Australia concerning (Footnote continues on next page) Kirby Potentially, that interest would be inhibited by an unrestricted or long-term prohibition on publication such as the Chief Commissioner was seeking and the trial judges had refused. It is not sufficient for the assurance of open justice in this country that the doors of a court should be unlocked. Fair and accurate reports of what occurs in courtrooms is an essential attribute of the administration of justice in Australia107. To the extent that the Supreme Court Act ss 18 and 19 impinge upon these essential features of the Australian court system, the exercise of the powers there provided must take the principle of open justice into close account. The Court of Appeal and the primary judges were correct to so decide. Those representing the Chief Commissioner must have known that those considerations would be weighed in determining summonses for leave to appeal, if that became essential, as it did. Tendering impermissible submissions: Fifthly, the belated attempt on the part of the Chief Commissioner to enlarge the record by communicating, apparently without leave, additional submissions and evidence whilst the proceedings were under consideration by the Court of Appeal does not alter the foregoing conclusion. The Court would have been entitled to ignore the unsolicited materials. Alternatively, it would have been open to regard them as adding nothing of substance for the leave application to the submissions previously put. If additional evidence was thought to be essential, beyond that which had been placed before the trial judges when the subject orders were sought (or the Court of Appeal when the matters were argued there), it would also have been open to the Court of Appeal to ask itself why it should act upon such additional material as to problems said to have arisen for police in North America. That material did not amount to "fresh evidence". The failure to tender it, at first instance or earlier, was unexplained. Procedural considerations: Sixthly, it is possible that the mistaken expectation amongst those representing the Chief Commissioner arose because of the usual procedure of this Court in now generally hearing separately special leave applications and the appeal pursuant to special leave, where such leave is "[s]ubterfuge, ruses and tricks … employed by police, acting in the public interest": see Swaffield (1998) 192 CLR 159 at 220 [155]; cf R v Heaney and Welsh [1998] 4 VR 636 at 647; Vale (2001) 120 A Crim R 322 at 335-336 [52], 337 [56]. See also Roba (2000) 110 A Crim R 245 at 251; Dewhirst (2001) 122 A Crim R 403 at 408 [26]; Binning v Lehman (2002) 133 A Crim R 294; R v Chimirri (2002) 136 A Crim R 381; R v Juric (2002) 4 VR 411 at 443-444 [54]. 107 Police Tribunal Case (1986) 5 NSWLR 465 at 476-477; Waterhouse v Broadcasting Station 2GB Pty Ltd (1985) 1 NSWLR 58 at 62. Kirby granted. The practice of intermediate courts in Australia varies. But it is not uncommon for that practice to follow the course that was observed by this Court in earlier times when leave considerations were often telescoped into the hearing of substantive appeals. If there was any doubt at all, and if it was considered important, it was the duty of those representing the Chief Commissioner to clear up the doubt. Even after the Court of Appeal pronounced its orders, and before those orders were formalised, it would have been open to the Chief Commissioner to approach the Court of Appeal in open court, to suggest a misapprehension as to the procedures that would be followed, and to request vacation of the orders so that any outstanding matters of substance could be argued108. No such application was made. One inference available is that any such application would have been rebuffed summarily given the way the proceedings had been argued, as apparently understood by the Court of Appeal itself and as understood by the Age. Conclusion: no procedural unfairness: The Chief Commissioner has not established that the Court of Appeal failed to accord her procedural fairness. That complaint should be rejected. The applications from the primary orders Having regard to the conclusion that an appeal lay from the orders made by the respective trial judges under the Supreme Court Act, s 18, by leave of the Court of Appeal and not as of right, the disposition of the summonses for leave to appeal brought the orders so made into the Court of Appeal for its determination. Having correctly treated the proceedings as it did, as "applications" (that is, for leave), the disposition by the Court of Appeal of those applications obviates the necessity, or appropriateness, of this Court's granting special leave to appeal directly from the orders of the trial judges. The proceedings having been decided regularly within the hierarchy of the Supreme Court of Victoria, the proper way to bring them before this Court, if at all, was by the procedure of appeal by special leave109. That procedure having been invoked, special leave having been granted and the appeal from that order heard and decided, it would be inappropriate for this Court to permit a separate appeal from the orders of the trial judges. The only conceivable argument for permitting such a course would be if it was shown that a serious injustice had occurred, for whatever reason, because of 108 De L v Director-General, NSW Department of Community Services [No 2] (1997) 190 CLR 207 at 215-216. 109 Judiciary Act 1903 (Cth), s 35(1)(a). Kirby the failure of the Court of Appeal to permit the Chief Commissioner to advance, as on a substantive appeal, all of the arguments that she wished to offer in support of correction of the primary orders and substitution of orders under the Supreme Court Act, s 18, of indefinite duration. It was made clear that the Chief Commissioner attached great importance to her applications and to the suggested need to protect from media coverage and discussion in Australia the techniques and "scenarios" used in securing the convictions of Messrs Tofilau and Favata. That is why I have taken pains to explain the police concerns and to outline the Chief Commissioner's arguments. It is possible that disclosure and discussion of the subject methods in the media (if it occurred) would, as a practical matter, come to much wider notice than would occur through discussion in law reports, academic journals, word of mouth and prison gossip. Necessarily, the determination of the present proceedings could not foreclose either the amendment of the duration of the previous orders (for the protection of the identity of the undercover operatives) or the making of new and different orders in these or other cases, based on new and different evidence and argument. That is the nature of interlocutory orders of such a kind. However, nothing was put to this Court that warranted a conclusion different from that of the Court of Appeal. On the basis of the materials in the record, it was open to the trial judges to refuse orders of indefinite duration designed to prevent publication of the police methods disclosed in open court in the trials of the two accused. Deciding in the way the trial judges did was consonant with the legal principles applicable to the exercise of the powers afforded by the Supreme Court Act, s 18. Assuming that this Court might, in a wholly exceptional case, in order to repair a serious injustice, grant special leave to appeal from the orders of a trial judge in circumstances such as this, the present were not exceptional cases of such a kind. That is why the applications were refused. Orders The orders of the Court were pronounced at the conclusion of argument on 10 August 2004. The foregoing are my reasons for joining in those orders.

HIGH COURT OF AUSTRALIA PORT OF NEWCASTLE OPERATIONS PTY LIMITED APPELLANT AND GLENCORE COAL ASSETS AUSTRALIA PTY LTD & ORS RESPONDENTS Port of Newcastle Operations Pty Limited v Glencore Coal Assets Australia Pty Ltd [2021] HCA 39 Date of Hearing: 7 September 2021 Date of Judgment: 8 December 2021 ORDER Vary the orders of the Full Court of the Federal Court of Australia made on 24 August 2020 by inserting a new order 5: "The determination according to law by the Tribunal on remitter pursuant to order 1 be confined to redetermining the scope of the Navigation Service Charge." Appeal otherwise dismissed. On appeal from the Federal Court of Australia Representation C A Moore SC with D J Roche for the appellant (instructed by Clayton Utz) N J Young QC with N P De Young QC and M P Costello for the first respondent (instructed by Clifford Chance) S B Lloyd SC with C M Dermody for the third respondent (instructed by Submitting appearance for the second respondent Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Port of Newcastle Operations Pty Limited v Glencore Coal Assets Australia Pty Ltd Trade practices – Competition – Access to services – Where declared service under Pt IIIA of Competition and Consumer Act 2010 (Cth) ("Act") for provision of right to access and use certain infrastructure at Port of Newcastle ("Port") – Where operator of Port fixed navigation service charge and wharfage charge under Ports and Maritime Administration Act 1995 (NSW) for use of certain port infrastructure – Where access dispute concerned amount of navigation service charge and wharfage charge – Whether Australian Competition Tribunal ("Tribunal") erred in determining range of circumstances in which navigation service charge payable – Whether Tribunal erred in determining amount of navigation service charge – Meaning of "access" in Pt IIIA of Act – Construction of s 44X(1)(e) of Act – Application of pricing principles in s 44ZZCA of Act. Words and phrases – "access", "access dispute", "competition", "declaration of a service", "depreciated optimised facility", "navigation service charge", "physical use", "pricing principles", "provider", "regulated asset base", "service", "third party", "use", "user contributions". replacement cost", "essential Competition and Consumer Act 2010 (Cth), Pt IIIA, ss 44X(1)(e), 44ZZCA. Ports and Maritime Administration Act 1995 (NSW), ss 48(4), 50, 51, 67. KIEFEL CJ, GAGELER, GORDON, STEWARD AND GLEESON JJ. This is an appeal by special leave from a decision of the Full Court of the Federal Court (Allsop CJ, Beach and Colvin JJ)1 given on an appeal on questions of law from a decision of the Australian Competition Tribunal2. The appeal raises issues of statutory construction central to the operation of Pt IIIA of the Competition and Consumer Act 2010 (Cth) ("the Act"). The appellant is Port of Newcastle Operations Pty Limited ("PNO"). Since 2014, PNO has been the lessee from the State of New South Wales of the Port of Newcastle and has been the "operator" of the Port under the Ports and Maritime Administration Act 1995 (NSW) ("the PMA Act"). The Port is one of the largest coal exporting ports in the world. The Port is the only commercially viable means of exporting coal from more than 30 operating coal mines in the Hunter Valley. PNO, in its capacity as operator of the Port, relevantly controls use by those involved in the export of coal of two categories of facility at the Port. One is the loading berths, located at the three terminals at the Port, at which ships are loaded with coal for export. The other is the shipping channels, through which ships entering the Port must pass to reach the loading berths and through which ships once loaded must again pass to exit the Port. The shipping channels were constructed by dredging and associated public works undertaken by the State of New South Wales at various times over the course of more than a century before the State leased the Port to PNO. The first respondent is Glencore Coal Assets Australia Pty Ltd ("Glencore"). It is the largest producer of coal in the Hunter Valley. It owns or operates roughly a third of the mines producing the coal that is exported through the Port. To facilitate the export through the Port of the coal that Glencore produces at its mines, Glencore has entered into a series of long term "take or pay" contracts with downstream service providers. It has organised for the coal to be transported from the mine to the Port under long term contracts both with rail haulage providers and separately with Australian Rail Track Corporation, which provides 1 Glencore Coal Assets Australia Pty Ltd v Australian Competition Tribunal (2020) 280 FCR 194. 2 Application by Port of Newcastle Operations Pty Ltd [2019] ACompT 1. use of the track. It has organised for the coal then to be loaded onto ships berthed at one of the three terminals located at the Port, under a long term contract with the coal loader operating at that terminal. Most of the coal produced by Glencore that is by those means transported by rail from the mine to the Port and there loaded onto ships berthed at a terminal is sold by Glencore to overseas buyers under "free on board" ("FOB") contracts. Under a standard FOB contract, the seller is required to deliver the goods sold onto a ship nominated by the buyer at the named port of shipment. The buyer bears all shipping and subsequent costs. The buyer is typically the charterer of the ship, the terms on which the ship is chartered by the buyer being a matter of separate contractual arrangement between the buyer and the owner or operator of the ship. Some of the coal is sold by Glencore to overseas buyers under "cost, insurance and freight" ("CIF") contracts. Under a standard CIF contract, the seller is required to contract for and pay the costs and freight necessary to bring the goods to the named port of destination and is required to contract for insurance cover against the buyer's risk of loss or damage to the goods. The seller is typically the charterer of the ship, the terms on which the ship is chartered by the seller being a matter of separate contractual arrangement between the seller and the owner or operator of the ship. The other respondents to the appeal are the Tribunal and the Australian Competition and Consumer Commission ("the ACCC"). The Tribunal has appropriately entered a submitting appearance. The ACCC has chosen to present submissions which support the decision of the Full Court. Whether the litigious posture of the ACCC is consistent with the principle in R v Australian Broadcasting Tribunal; Ex parte Hardiman3 was touched on but not developed in the course of the hearing. The absence of further consideration in these reasons of the posture of the ACCC should be understood as neither condemnation nor condonation. To allow the issues raised in the appeal to be understood, it is appropriate to set out the scheme of Pt IIIA of the Act and to note the relevant provisions of the PMA Act before going on to record the procedural history and to examine the reasoning of the Tribunal and of the Full Court. (1980) 144 CLR 13. Gordon Steward Gleeson Part IIIA of the Act Part IIIA of the Act is headed "Access to services". The Part was inserted into the Act, then known as the Trade Practices Act 1974 (Cth), by amendment in 1995 ("the 1995 Act")4. Insertion of the Part implemented a provision of the Competition Principles Agreement5 agreed to by the Council of Australian Governments ("COAG") that year in accordance with a recommendation in the report two years earlier of the National Competition Policy Review chaired by ("the Hilmer Report")6. the Commonwealth Parliament of the Bill for the 1995 Act was preceded by release by COAG for public comment of a package of material containing an exposure draft both of the Bill and of the Competition Principles Agreement ("the Information Package")7. Introduction into Following an extensive review by the Productivity Commission in 20018, Pt IIIA was amended in 2006 ("the 2006 Act")9. Aspects of the Part in the form inserted by the 1995 Act were considered by this Court in 200810. Other aspects of the Part in the form amended by the 2006 Act were subsequently considered by this Court in 201211. Following a further review of the Part by the Productivity 4 Competition Policy Reform Act 1995 (Cth). 5 Competition Principles Agreement, 11 April 1995, cl 6. 6 National Competition Policy (1993), ch 11. 7 National Competition Policy: Draft Legislative Package (1994). Productivity Commission, Review of the National Access Regime, Report No 17 Trade Practices Amendment (National Access Regime) Act 2006 (Cth). 10 BHP Billiton Iron Ore Pty Ltd v National Competition Council (2008) 236 CLR 11 Pilbara Infrastructure Pty Ltd v Australian Competition Tribunal (2012) 246 CLR Commission in 201312 and consideration of the Part in the context of a more general review of competition policy undertaken by the Competition Policy Review chaired by Professor Ian Harper which reported in 2015 ("the Harper Review")13, the Part was amended most recently in 2017 ("the 2017 Act")14. Part IIIA is economic and pro-competitive in its orientation. The first of its two express objects, inserted by the 2006 Act following a recommendation of the Productivity Commission in 2001, is to "promote the economically efficient operation of, use of and investment in the infrastructure by which services are provided, thereby promoting effective competition in upstream and downstream markets"15. That is the principal object of the Part. It alludes to the operation of its central provisions. The second of the two express objects, also inserted by the 2006 Act following a recommendation of the Productivity Commission in 2001, is to "provide a framework and guiding principles to encourage a consistent approach to access regulation in each industry"16. It alludes not to the operation of central provisions of the Part but to provisions which apply the framework and principles established by the Part in the pursuit of the principal object to facilitate industry- specific access regimes17 and to guide the structure and content of State and Territory access regimes18. For present purposes, the second object can be put to one side. 12 Productivity Commission, National Access Regime, Inquiry Report No 66 (2013). 13 Competition Policy Review, Final Report (2015). 14 Competition and Consumer Amendment (Competition Policy Review) Act 2017 (Cth). 15 Section 44AA(a) of the Act. 16 Section 44AA(b) of the Act. 17 Section 44F(1)(b) and Div 6 of Pt IIIA of the Act. 18 Section 44F(1)(a) and Div 2A of Pt IIIA of the Act. The expression of the principal object of the Part clarifies the solution which Pt IIIA provides to what was identified in the Hilmer Report as "the 'essential facilities' problem". The Hilmer Report explained the problem as follows19: "Some economic activities exhibit natural monopoly characteristics, in the sense that they cannot be duplicated economically. While it is difficult to define precisely the term 'natural monopoly', electricity transmission grids, telecommunication networks, rail tracks, major pipelines, ports and airports are often given as examples. Some facilities that exhibit these characteristics occupy strategic positions in an industry, and are thus 'essential facilities' in the sense that access to the facility is required if a business is to be able to compete effectively in upstream or downstream markets. ... Where the owner of the 'essential facility' is not competing in upstream or downstream markets, the owner of the facility will usually have little incentive to deny access, for maximising competition in vertically related markets maximises its own profits. Like other monopolists, however, the owner of the facility is able to use its monopoly position to charge higher prices and derive monopoly profits at the expense of consumers and economic efficiency." The classic example of the essential facilities problem is provided by the facts in United States v Terminal Railroad Association of St Louis20. Getting into or out of St Louis by rail required the use of either of two bridges spanning the Mississippi River. An association of railroad companies acquired control of both bridges. They charged non-members the same price as they charged themselves. The price, however, was a monopoly price that disadvantaged non-members. Discussions of the essential facilities problem in a regulatory context often refer to an essential facility having natural monopoly characteristics, access to which is needed to compete effectively in an upstream or downstream market, as a "bottleneck facility" or "bottleneck monopoly". The metaphor is apt to describe the kind of facility with which Pt IIIA is concerned. The metaphor was taken up 19 Hilmer Report at 240-241 (footnotes omitted). by the Tribunal in 200021, by the Productivity Commission in 200122 and by the Harper Review in 201523. Division 1 of Pt IIIA sets out a number of definitions. Three of those definitions, contained within s 44B, are central to Pt IIIA's solution to the essential facilities problem. The first is the definition of "service", which is relevantly as follows: "service means a service provided by means of a facility and includes: the use of an infrastructure facility such as a road or railway line; The second is the definition of "provider", which is as follows: "provider, in relation to a service, means the entity that is the owner or operator of the facility that is used (or is to be used) to provide the service." The third is the definition of "third party", which is as follows: "third party, in relation to a service, means a person who wants access to the service or wants a change to some aspect of the person's existing access to the service." The term "access", which appears in the heading to Pt IIIA and in the third of those definitions and throughout Pt IIIA, is undefined. The meaning to be attributed to the undefined term in the context of the Part is central to the resolution of issues in the appeal that will be examined in due course. At this point, it is convenient simply to record an explanation of the term given by COAG in commentary on the Bill for the 1995 Act forming part of the 21 Re Sydney Airports Corporation Ltd (2000) 156 FLR 10 at 37 [82]. 22 Productivity Commission, Review of the National Access Regime, Report No 17 23 Competition Policy Review, Final Report (2015) at 72-74. Information Package. Linking the proposed statutory use of the term to the essential facilities problem identified in the Hilmer Report, COAG explained24: "The term 'access' means the ability of suppliers or buyers to purchase the use of essential facilities on fair and reasonable terms. An essential facility is a transportation or other system which exhibits a high degree of natural monopoly; that is, a competitor could not duplicate it economically. A natural monopoly becomes an essential facility when it occupies a strategic position in an industry such that access to it is required for a business to compete effectively in a market upstream or downstream from the facility. Possible examples of such facilities are electricity transmission lines, gas pipelines, water pipelines, railways, airports, telecommunication channels and sea ports. Such facilities can be owned by private or public sector organisations." To that contextual explanation of the meaning of "access", it will be appropriate in due course to return. Part IIIA sets out to achieve its principal object of promoting the economically efficient operation of, use of and investment in the infrastructure by which services are provided, and of thereby promoting effective competition in upstream and downstream markets, by setting up a regulatory process by which a third party can gain access to a service provided by means of a facility. The regulatory process involves two distinct stages. The first stage of the process involves the declaration of a service for the purpose of the Part. Division 2 allows any person to ask the National Competition Council ("the NCC") to recommend that a particular service be declared25. Following consideration of the request by the NCC and the making by the NCC of a recommendation, one way or the other, the "designated Minister", who might be a Minister of the Commonwealth or of a State or Territory26, is obliged to declare 24 National Competition Policy: Draft Legislative Package (1994) at 1.10. 25 Section 44F of the Act. 26 Section 44D of the Act. or decide not to declare the service27. The decision of the designated Minister, either way, is subject to merits review by the Tribunal28. The declaration of a service, if made by the designated Minister or by the Tribunal on review, must be published29 and must be included in a public register maintained by the ACCC30. The declaration, once made, operates prospectively for such period as is specified in the declaration31 unless earlier revoked32. The criteria governing the decision of the designated Minister or of the Tribunal on review, to declare or not to declare a service, have altered as a result of the 2017 Act. Before the 2017 Act, the first of the criteria of which the designated Minister or the Tribunal needed to be satisfied in order to declare a service – "criterion (a)" – was "that access (or increased access) to the service would promote a material increase in competition in at least one market (whether or not in Australia), other than the market for the service"33. As a consequence of the 2017 Act, criterion (a) has been recast. Now it requires satisfaction "that access (or increased access) to the service, on reasonable terms and conditions, as a result of a declaration of the service would promote a material increase in competition in at least one market (whether or not in Australia), other than the market for the service"34. That change to criterion (a) has changed the analysis required to be undertaken by the NCC in making a recommendation, by the designated Minister in deciding to declare or not to declare a service, and by the Tribunal on review of 27 Section 44H of the Act. 28 Section 44K of the Act. 29 Sections 44HA and 44K(9) of the Act. 30 Section 44Q(b) of the Act. 31 Section 44I of the Act. 32 Section 44J of the Act. 33 Former section 44H(4)(a) of the Act. 34 Section 44CA(1)(a) of the Act. a decision of the designated Minister. Formerly, the analysis involved comparing the extent of future competition in an upstream or downstream market if there was access with the same if there was no access35. Latterly, the analysis involves a comparison of the extent of future competition in an upstream or downstream market were there to be declaration of the service with the same if there was no declaration of the service. The 2017 Act affected the events relating to the subject matter of the appeal in ways that will be noted in explaining the procedural background to the appeal. No party to the appeal has argued that the change to criterion (a) altered the underlying meaning of the term "access". As will be seen, criterion (a) in the form in which it now stands as a result of the 2017 Act nevertheless has a bearing on how the term "access" is best to be understood. The second stage of the regulatory process, dealt with in Div 3, involves a third party gaining "access" to the service declared through conferral of what has been described as "an enforceable right to negotiate"36. The provision conferring that right is s 44S(1): "If a third party is unable to agree with the provider on one or more aspects of access to a declared service, either the provider or the third party may notify the [ACCC] in writing that an access dispute exists, but only to the extent that those aspects of access are not the subject of an access undertaking that is in operation in relation to the service." Notification of an access dispute in the exercise of the right conferred by s 44S(1) has the effect of commencing an arbitration before the ACCC. The parties to that arbitration are the provider and the third party as well as "any other person who applies in writing to be made a party and is accepted by the [ACCC] as having a sufficient interest"37. 35 Sydney Airport Corporation Ltd v Australian Competition Tribunal (2006) 155 FCR 124 at 146-148 [76]-[89]; Port of Newcastle Operations Pty Ltd v Australian Competition Tribunal (2017) 253 FCR 115 at 133-134 [86]-[89]. 36 BHP Billiton Iron Ore Pty Ltd v National Competition Council (2008) 236 CLR 145 37 Section 44U of the Act. Unless it terminates the arbitration, the ACCC is obliged to make a written final determination "on access by the third party to the service"38. Amongst the circumstances in which the ACCC is permitted to terminate the arbitration are where it considers the notification of the dispute to have been vexatious and where it considers the subject matter of the dispute to be trivial, misconceived or lacking The permitted scope of the final determination to be made by the ACCC, and the considerations that must be taken into account in making it, are set out in some detail in Div 3. Section 44V(2) provides in part: "A determination may deal with any matter relating to access by the third party to the service, including matters that were not the basis for notification of the dispute. By way of example, the determination may: require the provider to provide access to the service by the third party; require the third party to accept, and pay for, access to the service; specify the terms and conditions of the third party's access to the service; require the provider to extend the facility; Section 44V(2A) adds: "Without limiting paragraph (2)(d), a requirement referred to in that paragraph may do either or both of the following: require the provider to expand the capacity of the facility; require the provider to expand the geographical reach of the facility." 38 Section 44V(1) of the Act. 39 Section 44Y of the Act. Section 44W(1) provides in part: "The [ACCC] must not make a determination that would have any of the following effects: resulting in the third party becoming the owner (or one of the owners) of any part of the facility, or of extensions of the facility (including expansions of the capacity of the facility and expansions of the geographical reach of the facility), without the consent of the provider; requiring the provider to bear some or all of the costs of extending the facility (including expanding the capacity of the facility and expanding the geographical reach of the facility); requiring the provider to bear some or all of the costs of maintaining extensions of the facility (including expansions of the capacity of the facility and expansions of the geographical reach of the facility); Section 44X(1) provides in part: "The [ACCC] must take the following matters into account in making a final determination: the objects of this Part; the legitimate business interests of the provider, and the provider's investment in the facility; the public interest, including the public interest in having competition in markets (whether or not in Australia); the interests of all persons who have rights to use the service; the direct costs of providing access to the service; the value to the provider of extensions (including expansions of capacity and expansions of geographical reach) whose cost is borne by someone else; the operational and technical requirements necessary for the safe and reliable operation of the facility; the economically efficient operation of the facility; the pricing principles specified in section 44ZZCA." Section 44ZZCA, to which reference is made in s 44X(1)(h), provides in part: "The pricing principles relating to the price of access to a service are: that regulated access prices should: be set so as to generate expected revenue for a regulated service or services that is at least sufficient to meet the efficient costs of providing access to the regulated service or services; and include a return on investment commensurate with the regulatory and commercial risks involved; and that access pricing regimes should provide incentives to reduce costs or otherwise improve productivity." The final determination made by the ACCC is subject to review by the Tribunal at the request of any party to the arbitration40. The review by the Tribunal is "a re-arbitration of the access dispute", for the purposes of which the Tribunal 40 Section 44ZP(1) of the Act. has the same powers as the ACCC41. The result of the review is a decision of the Tribunal, either affirming or varying the final determination42. The final determination, as made by the ACCC or as it might be affirmed or varied by the Tribunal on review, operates to bind the parties to the arbitration for the period specified in the determination43, subject to variation by consent44, and must be recorded in a public register maintained by the ACCC45. A party to a final determination that has been affirmed or varied by the Tribunal on review has a right to "appeal" to the Federal Court from the decision of the Tribunal46. That "appeal", which is in truth a proceeding in the original jurisdiction of the Federal Court47, is "on" and therefore limited to "a question of law"48. A question of law on an appeal can include a question about whether the decision of the Tribunal to make the final determination was arrived at by a process of reasoning that was compliant with s 44X(1). The final aspect of the scheme of Pt IIIA to be noted is the power49 and jurisdiction50 conferred on the Federal Court to enforce a final determination. On the application of a party to the determination, the Federal Court can enforce the 41 Section 44ZP(3) and (4) of the Act. 42 Section 44ZP(6) of the Act. 43 Section 44ZO of the Act. 44 Section 44ZU of the Act. 45 Section 44ZZL of the Act. 46 Section 44ZR(1) of the Act. 47 Section 19(2) of the Federal Court of Australia Act 1976 (Cth). 48 Section 44ZR(1) of the Act. See Haritos v Federal Commissioner of Taxation (2015) 233 FCR 315 at 348-349 [85], quoting Brown v Repatriation Commission (1985) 7 FCR 302 at 304. 49 Section 44ZZD(1) of the Act. 50 Section 15C of the Acts Interpretation Act 1901 (Cth). determination by injunction, by order for compensation or by other appropriate order, if satisfied "that another party to the determination has engaged, is engaging, or is proposing to engage in conduct that constitutes a contravention of the determination". The PMA Act The rights, obligations and powers of PNO as the operator of the Port are regulated under the PMA Act. That includes imposing limits on the kind of charges that PNO is permitted to fix and to recover. In relation to use of the navigation channels and loading berths at the Port, the PMA Act limits PNO to fixing and recovering "navigation service charge" and "wharfage charge". The navigation service charge that can be fixed by PNO51 is in respect of "the general use" by a vessel of the Port, imposed by reference to the gross tonnage of the vessel, on each entry of the vessel into the Port52. The charge therefore covers the use by the vessel of navigation channels. The charge is payable by the "owner" of the vessel. The meaning of "owner" for this purpose is extended by s 48(4) of the PMA Act to include a person who, "on the person's own behalf or on behalf of another", "(a) exercises any of the functions of the owner of the vessel" or who "(b) represents to [PNO] that the person has those functions or accepts the obligation to exercise those functions". The wharfage charge that can be fixed by PNO53 is payable in respect of "availability of a site at which stevedoring operations may be carried out"54, and therefore covers the availability of a loading berth. The charge is calculated by reference to the quantity of cargo loaded or unloaded at the site and is payable by 51 Section 51 of the PMA Act. 52 Section 50 of the PMA Act. 53 Section 62 of the PMA Act. 54 Section 61(1), read with s 47(1) (definition of "stevedoring") and s 59 (definition of "site"), of the PMA Act. the person who is the owner of the cargo immediately before it is loaded or unloaded55. Section 67 of the PMA Act permits PNO to enter into an agreement with a person who is liable to pay either navigation service charge or wharfage charge. The agreement into which PNO is permitted to enter can make provision for, or with respect to, fixing the amount of either kind of charge payable by that person. To the extent that provision is made in an agreement, the agreement displaces the amount of the charge otherwise determined by PNO. The mechanism in s 67, in combination with the capacity for Glencore to make use of the extended meaning of "owner" in s 48(4)(b) so as to become liable to pay the navigation service charge even when it sells FOB, means that an obligation pertaining to the amount of the navigation service charge or wharfage charge payable by Glencore to PNO as the result of the final determination of an access dispute under Pt IIIA can be fashioned so as to be able to be performed within the scope of the PMA Act. No question of "operational inconsistency"56 between Pt IIIA of the Act and the PMA Act arises for consideration in the appeal. Procedural history Following increases in amounts fixed as navigation service charge and as wharfage charge after PNO became operator of the Port in 2014, Glencore in 2015 asked the NCC to recommend declaration of the service provided by PNO by means of the shipping channels and loading berths at the Port. The NCC recommended against that declaration. The designated Minister, who was then the Acting Treasurer, decided not to make the declaration. Glencore applied to the Tribunal for review of the decision of the Acting Treasurer. The outcome of the review was that the Tribunal in 2016 set aside the decision of the Acting Treasurer and declared a service identified in the following terms57: 55 Section 61(2) and (3) of the PMA Act. 56 cf The Commonwealth v Western Australia (1999) 196 CLR 392 at 417 [61]-[62], 57 Application by Glencore Coal Pty Ltd [No 2] [2016] ACompT 7. "[T]he provision of the right to access and use the shipping channels (including berths next to wharves as part of the channels) at the Port of Newcastle (Port), by virtue of which vessels may enter a Port precinct and load and unload at relevant terminals located within the Port precinct and then depart the Port precinct." That declaration will be referred to in these reasons as "the Declaration". The service identified in the Declaration will be referred to as "the Service". The Declaration was for a period specified to expire in 2031. In deciding to make the Declaration, the Tribunal found the Service to be "a necessary input for effective competition" in what the Tribunal identified to be the "market for the export of coal from the Hunter Valley". Applying criterion (a) as it then stood, the Tribunal concluded that access to the Service would promote a material increase in competition in that market, and in other identified dependent markets, in comparison to the competition that would exist were there to be no access to the service58. An application by PNO for judicial review of the decision of the Tribunal to make the Declaration was dismissed by the Full Court of the Federal Court in 201759. So, the initial declaration stage of the regulatory process ended. Glencore had in the meantime triggered the second stage of the regulatory process by notifying the ACCC of the existence of an access dispute in relation to the Service. Glencore had described the dispute in its notification to the ACCC as follows: "Although PNO is currently providing access (and maintaining that it will always do so) the terms of access, in particular the navigation service charges for coal vessels, are unreasonable and Glencore is seeking to negotiate with PNO on reducing these charges to approximately their pre- privatisation levels ... . Glencore submits that, at the very least, an economically efficient charge is likely to be significantly lower than the rates which are currently being applied by PNO." 58 Application by Glencore Coal Pty Ltd [2016] ACompT 6 at [113], [121]. 59 Port of Newcastle Operations Pty Ltd v Australian Competition Tribunal (2017) 253 FCR 115. The notification of the access dispute had commenced an arbitration to which Glencore and PNO were parties. The ACCC made its final determination on the access dispute in 2018. Glencore then applied to the Tribunal for review of the ACCC's final determination. The outcome of that review was the decision of the Tribunal in 2019, which varied that final determination60. That decision will be referred to in these reasons as "the Tribunal Decision". The final determination as varied by the Tribunal will be referred to as "the Final Determination". Glencore appealed from the Tribunal Decision to the Full Court. Finding errors of law in the Tribunal Decision, the Full Court set aside the Tribunal Decision and remitted the matter to the Tribunal for determination according to law61. It is from that decision of the Full Court, which will be referred to as "the Full Court Decision", that PNO now appeals to this Court. Before turning to examine the Tribunal Decision and the Full Court Decision, something more must be recorded about the complicated procedural history. Following the 2017 Act, the NCC recommended revocation of the Declaration. As the Treasurer – being the designated Minister at the time – did not publish a decision on the recommendation within the requisite time period, the Declaration was revoked by operation of a deemed decision of the Treasurer62. Then, in 2020, the New South Wales Minerals Council, an industry body of which Glencore is a member, asked the NCC again to recommend declaration of a service identified in terms materially identical to the Service. The NCC recommended against declaration, and in 2020 the Treasurer, as designated Minister, decided not to make a declaration. The New South Wales Minerals Council then applied to the Tribunal for review of the decision of the Treasurer. After the grant of special leave to appeal from the Full Court Decision, the Tribunal decided to affirm the decision of the Treasurer63. Applying criterion (a) 60 Application by Port of Newcastle Operations Pty Ltd [2019] ACompT 1 at [610]. 61 Glencore Coal Assets Australia Pty Ltd v Australian Competition Tribunal (2020) 280 FCR 194. 62 See s 44J(7) of the Act. 63 Application by New South Wales Minerals Council [No 3] [2021] ACompT 4. in its current form, the Tribunal was not satisfied that access on reasonable terms and conditions as a result of declaration of the service would promote a material increase in competition in another market in comparison with the circumstances likely to prevail in the absence of declaration64. Glencore and PNO have made clear that it is common ground that the revocation of the Declaration in 2017 has had no effect on the arbitration of the access dispute which Glencore notified to the ACCC in 201665. It appears to be common ground that the revocation of the Declaration will have no effect on the operation or enforcement of the final determination of that access dispute that will result either from the Tribunal Decision being restored (if this appeal is allowed and the Full Court Decision is set aside) or from a decision to be made by the Tribunal in the future (if this appeal is dismissed and the order remitting the matter to the Tribunal made by the Full Court is left to stand)66. The appeal can therefore be taken to continue to bear on the rights of the parties. Tribunal Decision The Final Determination, which resulted from the Tribunal Decision, was expressed to govern both the wharfage charge and the navigation service charge payable by Glencore to PNO for a period commencing in 2018 and expiring in 2031. The wharfage charge as determined in the Final Determination will be referred to in these reasons as "the Wharfage Charge". The navigation service charge as determined in the Final Determination will be referred to as "the Navigation Service Charge". The Wharfage Charge was uncontroversial at the time of the Tribunal Decision and remains uncontroversial. The Wharfage Charge was the subject of agreement between Glencore and PNO reached in the course of the arbitration and was not in dispute in the re-arbitration before the Tribunal. The Navigation Service Charge was controversial at the time of the Tribunal Decision in two respects. The first concerned the range of circumstances in which 64 Application by New South Wales Minerals Council [No 3] [2021] ACompT 4 at 65 See s 44I(4)(a) of the Act. 66 See s 44I(4)(b) of the Act. the Navigation Service Charge was to be payable by Glencore to PNO. The second concerned the calculation of the amount of the Navigation Service Charge. Scope of the Navigation Service Charge In the final determination reviewed by the Tribunal, the ACCC had determined that the navigation service charge was to be payable by Glencore to PNO in either of two circumstances. One was where Glencore, either directly or by an agent, chartered a ship to enter the Port and load its coal. The other was where Glencore brought itself within the extended meaning of "owner" in s 48(4)(b) of the PMA Act by representing to PNO that it had the functions of the owner, or accepted the obligation to exercise those functions, in order for a ship to enter the Port and load its coal. In the Final Determination, the Tribunal confined the scope of the Navigation Service Charge to the circumstance where Glencore owns or, either directly or by an agent, charters a ship to enter the Port and load its coal. The Final Determination thereby extended the Navigation Service Charge to circumstances where Glencore sold its coal CIF but excluded the Navigation Service Charge from circumstances where Glencore sold its coal FOB. The Tribunal arrived at its decision to confine the scope of the Navigation Service Charge taking a narrow view of what was meant by "[t]he provision of the right to access and use the shipping channels" in the description of the Service in the Declaration. Implicit in the Tribunal's adoption of that narrow view was an acceptance by the Tribunal of a submission by PNO to the effect that the reference to "access" within the description of the Service in the Declaration is closely tied to physical use. The Tribunal appears to have been persuaded to the view that, for a "service" constituted by a "use" of an infrastructure facility, no more than one person can answer the description of a "third party" who wants "access" to that "service" in connection with a particular vessel67. Amount of the Navigation Service Charge The controversy about the amount of the Navigation Service Charge was relatively narrow and highly technical. To make the controversy intelligible, 67 Application by Port of Newcastle Operations Pty Ltd [2019] ACompT 1 at [148]- something needs to be said about the methodology to which the controversy was related. Before the ACCC and before the Tribunal, Glencore and PNO agreed that the appropriate methodology to determine the amount of the navigation service charge to be payable by Glencore to PNO was a "building block model" ("BBM"). The BBM on which they agreed was a modified version of the Australian Energy Regulator's publicly available "Post-Tax Revenue Model". According to the agreed BBM, the amount of the navigation service charge to be payable by Glencore to PNO was to be based on a "maximum allowed revenue" ("MAR") to be allowed to PNO. The MAR was to consist of a number of components – the building blocks. The main building block of the MAR was a "return on capital" ("ROC"), to be calculated by applying a "weighted average cost of capital" ("WACC") to the value of the "regulated asset base" ("RAB"). The RAB comprised the assets required to provide the Service. The parties were agreed that the RAB was valued appropriately using a "depreciated optimised replacement cost" or "DORC" methodology, according to which the assets required to provide the Service were to be valued at the cost of replacing the remaining useful life of those assets. DORC methodology does not measure the cost of replacing assets in fact used to provide a service. Rather, it measures the cost that a hypothetical new entrant would incur to replace the assets using the latest technology in order to provide the service in the most up-to-date and cost-efficient way. The methodology in that way seeks to emulate what would happen to the value of the assets required to provide a service in a hypothetical competitive market for the service where the service provider faced competition from an efficient new entrant. The purpose of valuing the RAB at DORC when using the BBM was thereby to exclude monopoly profit from the ROC and in turn from the MAR. The controversy between the parties concerned whether the RAB, arrived at using DORC methodology, should be adjusted downwards, thereby reducing the MAR. The downwards adjustment, proposed by Glencore and resisted by PNO, was to take account of the historical circumstance that some of the original investment made by the State of New South Wales in creating the shipping channels and associated public works now used by PNO to provide the Service could be argued to have been funded by "user contributions" in the form of levies and charges imposed by the State on past users of the Port. The ACCC had thought that such an adjustment was appropriate. Having calculated the optimised replacement cost of the RAB at $2.17 billion, the ACCC deducted $912 million to account for what it calculated to be the optimised replacement cost of user contributions, to arrive at an adjusted optimised replacement cost of $1.26 billion. The ACCC then depreciated that adjusted optimised replacement cost to arrive at a DORC value of the RAB of $1.16 billion. The consequence of valuing the RAB at $1.16 billion was that the navigation service charge payable by Glencore to PNO was determined to be $0.6075 (as at 1 January 2018). The ACCC had explained its reasons for making that adjustment as follows68: "The [ACCC] considers that deducting user funded capital contributions from the DORC value used to establish PNO's initial RAB is in the interests of those who have a right to use the Service (section 44X(1)(c)) because it will ensure that users do not pay for the same assets twice: once through their initial investment and again through PNO's charges. This in turn promotes the economically efficient operation of, use of and investment in the Service (sections 44X(1)(aa) and (g)) and also takes into account the value to PNO of extensions where the cost has already been borne by users (section 44X(1)(e)). At the same time, the DORC value net of user contributions ensures that PNO is able to earn sufficient revenue to recover its efficient costs (sections 44X(1)(h) and 44ZZCA(a)(i)), which is in the legitimate business interests of PNO and its investment in the facility (section 44X(1)(a))." The Tribunal took a different view. In relation to the construction of s 44X(1)(e), it took the view that "this factor is directed at situations where the determination requires the provider to extend the facility (for example by extending a train line to a third party's mine) and is not applicable here"69. In consequence, it thought that s 44X(1)(e) "does not of itself require the deduction of user contributions", though it added that "at the very least, the circumstances of 68 ACCC, Final Determination: Statement of Reasons – Access dispute between Glencore Coal Assets Australia Pty Ltd and Port of Newcastle Operations Pty Ltd (18 September 2018) at 136. 69 Application by Port of Newcastle Operations Pty Ltd [2019] ACompT 1 at [54]. the contribution need to be examined"70. It thought that adjusting the DORC downwards by reference to user contributions to arrive at an RAB could not generate efficient charges and was unwarranted in the circumstances71. It thought that "precluding a return on all the assets that are part of the facility (sunk or not) would send a signal to future investors in other natural monopoly assets that they risked having their investment, once made, treated as sunk, with future returns confiscated"72. It thought that disputation over the treatment of user contributions could not be resolved by "simplistic claims that users should not have to pay twice" and that "[o]nly clear indications of an understanding by the access provider and an expectation by the access user that future pricing would be adjusted in some way for the value of those assets could justify excluding them from the RAB"73. There was, it noted, "no evidence of any such understandings or expectations"74. The Tribunal added that "even if some regard was had to the financing of particular dredging projects (for instance), this would need to be done as part of a comprehensive examination of historical matters" which "would include the benefits provided by the State in return for contributions, the history of under- recovery by the State, the question of which users would be entitled to the benefit of any contributions and the users' expectations"75. It recorded that none of those matters were capable of being considered on the material before it76. The Tribunal accordingly restored the optimised replacement cost of the RAB to $2.17 billion, which it then depreciated to arrive at a DORC value of $2.08 billion. The result of valuing the RAB at $2.08 billion instead of $1.16 billion was to increase the Navigation Service Charge payable by Glencore to PNO in 70 Application by Port of Newcastle Operations Pty Ltd [2019] ACompT 1 at [300]. 71 Application by Port of Newcastle Operations Pty Ltd [2019] ACompT 1 at [278]. 72 Application by Port of Newcastle Operations Pty Ltd [2019] ACompT 1 at [354]. 73 Application by Port of Newcastle Operations Pty Ltd [2019] ACompT 1 at [359]- 74 Application by Port of Newcastle Operations Pty Ltd [2019] ACompT 1 at [361]. 75 Application by Port of Newcastle Operations Pty Ltd [2019] ACompT 1 at [365]. 76 Application by Port of Newcastle Operations Pty Ltd [2019] ACompT 1 at [365]. accordance with the Final Determination from $0.6075 to $1.0058 (as at 1 January Full Court Decision The Full Court took the view that the reasoning adopted in the Tribunal Decision to arrive at the Final Determination was affected by errors of law in relation to both the scope of the Navigation Service Charge and the amount of the Navigation Service Charge. Scope of the Navigation Service Charge The Full Court found that, in confining the scope of the Navigation Service Charge to circumstances where Glencore chartered a ship to enter the Port and load its coal, the Tribunal had taken an unduly physical view of what was meant by "the provision of the right to access and use the shipping channels" in the description of the Service in the Declaration. "Our fundamental disagreement with the Tribunal and the basis of our view that it misconstrued the Service, and thus asked itself the wrong question, is that access to and use of the shipping channels are not limited to, or indeed even governed by, the notion of physical access or use by the control and navigation of the vessel entering and leaving the Port to carry the coal. The broad context of the purpose of the declaration as directed to the relevant dependent market of the production, sale and export of coal makes that limitation or focus inappropriate. Access and use can be relevantly economic though connected closely and clearly, indeed immediately, to the physical activity involved. No particular general principle is at play here. Coal is exported in ships in respect of which any exporter may or may not have a particular or direct contractual arrangement. Whether or not an exporter makes any particular arrangement directly in controlling the physical or commercial deployment of the vessel does not affect a conclusion as a matter of meaning of the text of the Service that the exporter is accessing or using the shipping channels when, by its sale arrangement, it causes a vessel to enter the Port. It does so, that is it causes a vessel to enter the Port, when it sells CIF or FOB, irrespective of whether 77 Glencore Coal Assets Australia Pty Ltd v Australian Competition Tribunal (2020) 280 FCR 194 at 229 [158]. it owns, demise charters, time charters, or voyage charters the vessel, or not, as the case may be." The Full Court identified an alternative basis on which it considered that the Tribunal had erred. The Service, as the Full Court saw it, was indivisible. There was no dispute that Glencore accessed that part of the Service which comprised use of the loading berths where Glencore sold FOB. There was also no dispute that, in respect of its access to that part of the Service, Glencore was liable to pay the Wharfage Charge. If Glencore accessed that part of the Service which comprised use of the loading berths, as the Full Court saw it, Glencore also necessarily accessed the other part of the Service, which comprised the shipping channels needed to get to and from the loading berths78. The Full Court added the following observation79: "If, as we consider to be the case, Glencore is accessing and using the Service and shipping channels, the determination through a bilateral arbitration can, under s 44V(2), set the terms of access as between Glencore and PNO such that another person who may have a right of access to the shipping channels to carry Glencore's coal and who may be subject to the [Navigation Service Charge], can, through Glencore be given the ability or option of taking up Glencore's arbitrated price. The precise mechanism need not be set out here, save to say that it would need to be a product of the arbitrated bilateral rights and obligations between Glencore and PNO and conform practically to the workings of the Port and the PMA Act. This would ensure the benefit to Glencore of the arbitrated terms of access, and if for its own commercial reasons a shipowner or charterer wanted to pay more (for some preferential access, or its own commercial reasons otherwise) it would not be bound to take Glencore's arbitrated price. That may or may not be a commercial issue for Glencore: to be solved either in its contractual arrangements with the buyer or the shipowner or by making a representation for the purposes of s 48(4)(b) of the PMA Act. Such an arrangement falls entirely within the clause 'any matter relating to access by 78 Glencore Coal Assets Australia Pty Ltd v Australian Competition Tribunal (2020) 280 FCR 194 at 229-230 [159]-[160]. 79 Glencore Coal Assets Australia Pty Ltd v Australian Competition Tribunal (2020) 280 FCR 194 at 230 [162]. [Glencore]' in the chapeau to s 44V(2). The working out of such arrangements in the terms would be a matter for the Tribunal in the re- arbitration." The Full Court further added80: "Nor would there be any exceeding of the reach of Pt IIIA. The terms of access of Glencore are being fixed by determination which includes a mechanism of delivering an equivalent price to another party whose access overlaps or coincides with Glencore's access, so as to provide terms of access for Glencore. To require PNO to give the relevant shipowner a mechanism to take a [navigation service charge] of not more than $X as one of the terms and conditions of access by Glencore to the Service is only to ensure, or to make more likely, that Glencore will obtain the economic benefit of the declaration of the Service for its access to the Service." Amount of the Navigation Service Charge The Full Court went on to find that, in declining to arrive at an RAB by adjusting the DORC downwards by reference to user contributions, the Tribunal misconstrued and misapplied the mandatory consideration in s 44X(1)(e) and the pricing principle in s 44ZZCA(a)(ii) of the Act when determining the amount of the Navigation Service Charge. The requirement of s 44X(1)(e) to take into account "the value to the provider of extensions ... whose cost is borne by someone else" was construed by the Full Court as requiring account to be taken of "instances where the cost has been borne by someone other than the provider or access seeker [and] where the extension was not the outcome of the exercise of rights conferred by Part IIIA itself"81. On that construction, according to the Full Court, the Tribunal "was obliged to take into account the present value to PNO of extensions being borne by others by reason of past user contributions". It followed that, "[b]y approaching 80 Glencore Coal Assets Australia Pty Ltd v Australian Competition Tribunal (2020) 280 FCR 194 at 231-232 [167] (emphasis in original). 81 Glencore Coal Assets Australia Pty Ltd v Australian Competition Tribunal (2020) 280 FCR 194 at 250 [243]. the issue in the way that it did, the Tribunal closed out that possibility in a manner that was not consistent with the correct interpretation of s 44X(1)(e)"82. The pricing principle in s 44ZZCA(a)(ii) – that regulated access prices should "include a return on investment commensurate with the regulatory and commercial risks involved" – was construed by the Full Court to require "the formulation of an appropriate conclusion as to the value of the extent of the investment to be used in the assessment of the extent of return". This, according to the Full Court, the Tribunal "failed to do ... because of its view that a capital value determined in accordance with the agreed DORC methodology (without adjustment for any user funded contributions) was a value that would conform to the statutory requirement. That was not necessarily so."83 Issues In its appeal to this Court, PNO challenges the reasoning adopted by the Full Court in discerning legal error on the part of the Tribunal both in relation to the scope of the Navigation Service Charge and in relation to the amount of the Navigation Service Charge. In relation to the scope of the Navigation Service Charge, PNO argues that the Full Court was wrong to characterise Glencore, when selling FOB, as a "third party" in relation to the Service within the meaning of Pt IIIA of the Act. The statutory reference to "access", PNO argues, connotes some measure of control over physical activity. Mere economic benefit from the physical activity of another is not enough. When selling FOB, Glencore is not a person who wants "access" to that part of the Service which comprises use of the shipping channels. The only person who wants "access" to use of the shipping channels in that circumstance is the owner or charterer of the ship, with whom Glencore has no contractual relationship and in respect of whom it therefore has no control. In relation to the amount of the Navigation Service Charge, PNO argues that the Full Court misconstrued s 44X(1)(e) and overstated the effect of s 44ZZCA(a)(ii) of the Act. 82 Glencore Coal Assets Australia Pty Ltd v Australian Competition Tribunal (2020) 280 FCR 194 at 252 [254]. See also at 258 [288]. 83 Glencore Coal Assets Australia Pty Ltd v Australian Competition Tribunal (2020) 280 FCR 194 at 254 [267]. For the reasons which follow, PNO's argument about the scope of the Navigation Service Charge is to be rejected, while its argument about the amount of the Navigation Service Charge is to be accepted. Scope of the Navigation Service Charge The issues concerning the scope of the Navigation Service Charge are best addressed by construing the meaning of "access" in the context of Pt IIIA of the Act before turning to construe the Service as identified in the Declaration. The meaning of "access" in the context of Pt IIIA The principles of statutory construction are familiar. Oftentimes they can seem banal. The task of construing "access" in the context of Pt IIIA of the Act is nonetheless assisted by noticing four of those principles and highlighting their present significance. First, Pt IIIA is "always speaking in the present"84. One corollary is that the 1995 Act, the 2006 Act and the 2017 Act must now be read together85 "as a combined statement of the will of the legislature"86. Another corollary is that meaning must now be attributed to the ongoing reference to "access" having regard to how well a potentially attributable meaning fits within the scheme of Pt IIIA as that scheme has emerged from the totality of those amendments. Here, the fact that notification of the access dispute predated the 2017 Act arguably means that the Act as it stood before the 2017 Act governed the substantive rights in issue in the re-arbitration before the Tribunal87. Certainly, the reference to "access" in the description of the Service can only be understood in the context of the Act at the 84 Attorney-General for Queensland v Attorney-General for the Commonwealth (1915) 20 CLR 148 at 174. See Aubrey v The Queen (2017) 260 CLR 305 at 321- 322 [29]-[30]; R v A2 (2019) 269 CLR 507 at 552 [141], 562 [169]. 85 Section 11B(1) of the Acts Interpretation Act 1901 (Cth). 86 Commissioner of Stamps (SA) v Telegraph Investment Co Pty Ltd (1995) 184 CLR 453 at 463; Plaintiff S297/2013 v Minister for Immigration and Border Protection (2014) 255 CLR 179 at 186 [25]. 87 Section 7(2) of the Acts Interpretation Act 1901 (Cth); Esber v The Commonwealth (1992) 174 CLR 430 at 438-441. time the Declaration was made in 2016. Be that as it may, the operation of the 2017 Act cannot be ignored in assessing the fit of a potentially attributable meaning within the scheme of the Part88. Second, the ongoing reference to "access" in the text of Pt IIIA must be construed in the context of the Part as a whole within a broader context that includes the course of the legislative history of the Part and extrinsic materials pertaining to that legislative history. Understanding that broader context "has utility if, and in so far as, it assists in fixing the meaning of the statutory text"89. Third, as has been repeatedly emphasised in the context of Pt IIIA, "access" is "an ordinary English word" to be understood "in its ordinary English sense"90. That "access" retains its ordinary English meaning is common ground on the appeal. The contest between the parties is as to the applicable shade of ordinary meaning. The constructional choice presented accordingly "turns less on linguistic fit than on evaluation of the relative coherence of the alternatives with identified statutory objects or policies"91. Fourth, the constructional choice falls to be made in the application of the principle of purposive construction92 reflected in the statutory instruction that "the interpretation that would best achieve the purpose or object" of a Commonwealth Act "is to be preferred to each other interpretation"93. Application of that principle 88 Grain Elevators Board (Vict) v Dunmunkle Corporation (1946) 73 CLR 70 at 85- 86; Masson v Parsons (2019) 266 CLR 554 at 573-574 [28]. 89 Federal Commissioner of Taxation v Consolidated Media Holdings Ltd (2012) 250 CLR 503 at 519 [39]; Thiess v Collector of Customs (2014) 250 CLR 664 at 671 90 Port of Newcastle Operations Pty Ltd v Australian Competition Tribunal (2017) 253 FCR 115 at 130 [72], explaining Sydney Airport Corporation Ltd v Australian Competition Tribunal (2006) 155 FCR 124. 91 Taylor v Owners – Strata Plan No 11564 (2014) 253 CLR 531 at 557 [66]; SAS Trustee Corporation v Miles (2018) 265 CLR 137 at 149 [20]. 92 Thiess v Collector of Customs (2014) 250 CLR 664 at 672 [23]. 93 Section 15AA of the Acts Interpretation Act 1901 (Cth). requires that the term "access", no less than the term "service", be construed "in a way that would advance the attainment of the large national and economic The ultimate choice is therefore as to the shade of ordinary meaning of the term "access" that best gives effect to Pt IIIA's object of promoting the economically efficient operation of, use of and investment in the infrastructure by which services are provided and of thereby promoting effective competition in upstream and downstream markets. The 2017 Act takes on this significance in making that choice. Before the 2017 Act, it could be said in somewhat generic terms that "the access referred to in criterion (a)" – and by implication the "access" referred to elsewhere in Pt IIIA – "is access by any third party"95. Now, as a result of the 2017 Act, it is apparent that the mechanism through which the relevant object of the Part is sought to be achieved must be considered to be the "access" that a "third party" is given to a declared "service" by operation of the right to negotiate that s 44S(1) confers as a consequence of declaration. Starting therefore with the definitions of "third party" and "service" in s 44B, two things are immediately apparent. One is that "access to [a] service" is not the same as "the use of an infrastructure facility". The use of an infrastructure facility is a "service". "Access" to that service is not the same as the service itself: it is a different and wider concept; "access" can include "use" but "access" is not limited to "use". The other is that, to be a "third party" in relation to the service, a person need be no more than a person who "wants access to the service". Moving next to the incidents of the right to negotiate that s 44S(1) confers on a person who wants "access" to a declared service, it is apparent that the content of whatever "access" to a service comprising the use of an infrastructure facility that might be obtained through the exercise of the right to negotiate is circumscribed by the nature of the right. The outcome of the exercise of the right to negotiate is limited in the first instance to what might be determined by agreement between the person and the owner or operator of the facility. In default 94 BHP Billiton Iron Ore Pty Ltd v National Competition Council (2008) 236 CLR 145 at 161 [42]; Pilbara Infrastructure Pty Ltd v Australian Competition Tribunal (2012) 246 CLR 379 at 418 [97]. 95 Port of Newcastle Operations Pty Ltd v Australian Competition Tribunal (2017) 253 FCR 115 at 146 [140]. of agreement, the outcome of the exercise of the right is limited to what might be determined in an arbitration to which the person and the owner or operator are parties. Of course, some other interested person might volunteer to join a negotiation, so as to become a party to an agreement. Or some other interested person might choose to apply to become a party to an arbitration, so as to become bound by its final determination. Otherwise, the most that can come out of the exercise of the right to negotiate in relation to a declared service is a set of bilateral obligations, arrived at by agreement or determination by arbitration of disagreement, between a person who wants "access" to the use of the facility and the owner or operator of that facility. Nothing in Div 3 confines the bilateral obligations that might be agreed or imposed by a final determination of an access dispute to obligations concerning the use of the facility by the person who wants "access" to the use of the facility or to obligations concerning the use of the facility by someone who is in an ongoing contractual relationship with that person. To the contrary, as s 44V(2) is at pains to spell out, a determination can "deal with any matter relating to access by the third party to the service". The right of a third party to negotiate in relation to a declared service in that way replicates what might be expected to occur if the owner or operator of the facility by which the service in question is provided were operating in a competitive market, rather than being in a position to exercise monopoly power. In a competitive market, the threat of new entry would incentivise the owner or operator of the facility to negotiate towards agreement with any person in a given chain of supply who sincerely wanted to ensure the ability of that person, or of any other person in the chain of supply, to use the facility on reasonable terms and conditions. Were the owner or operator to refuse to negotiate on the basis that the person was not to be the actual user of the facility, the person would have the incentive and ability to look to making an agreement with the owner of a competing facility in order to secure the chain of supply. Of the range of potential meanings that the term "access" is capable of bearing as a matter of ordinary English96, the meaning that appears best to result in the right to negotiate operating to achieve the relevant object of promoting the economically efficient operation and use of, and investment in, the infrastructure by which services are provided is "[t]he right or opportunity to benefit from or use a system or service"97. In respect of a person who is a competitor in a sufficiently connected upstream or downstream market there is no reason to confine or further refine that meaning. The meaning accords with the straightforward explanation given by COAG in 1994 in the Information Package already quoted that "[t]he term 'access' means the ability of suppliers or buyers to purchase the use of essential facilities on fair and reasonable terms"98. The nature of an essential facility – a "bottleneck facility" – is that its use by someone in a supply chain is needed to compete effectively in a market that is upstream or downstream from the facility. To a supplier or buyer who is a competitor in that upstream or downstream market who wants to ensure that the use of the bottleneck facility is on fair and reasonable terms, it cannot matter which person in the supply chain actually uses that facility. To deny the right to negotiate to a competitor in a sufficiently connected upstream or downstream market who sincerely wants an opportunity to benefit from the use of an infrastructure facility by someone else, would have the potential to constrain the economically efficient operation and use of that infrastructure facility. In circumstances where the person is reliant on the use of the infrastructure facility by someone who is part of the person's chain of supply to an upstream or downstream market but is not someone with whom the person has a direct ongoing contractual relationship, the denial of the right to negotiate would have the potential to constrain the ability of that person to engage in effective competition in that upstream or downstream market. In both of those respects, the denial of the right to negotiate is antithetical to the achievement of the express object of the Part. The latter point is well enough illustrated by the circumstances of the present case. As is obvious, and as was for good measure spelt out in evidence 96 See Port of Newcastle Operations Pty Ltd v Australian Competition Tribunal (2017) 253 FCR 115 at 128 [67], quoting Re Virgin Blue Airlines Pty Ltd (2005) 195 FLR 97 Oxford English Dictionary, 3rd ed (2011), published online March 2021. 98 National Competition Policy: Draft Legislative Package (1994) at 1.10. placed before the Tribunal, wharfage charge pertaining to the use of the loading berths at the Port and navigation service charge pertaining to the use of the shipping channels at the Port both contribute to the landed cost of coal sold by Glencore to a buyer. That is so whether the coal is sold CIF (in which case the charterer of the ship physically using the shipping channels is typically Glencore) or FOB (in which case the charterer of the ship physically using the shipping channels is typically the buyer). To extend to Glencore the right to negotiate about the amount of the navigation service charge that might be fixed by PNO when Glencore sells CIF, but to deny to Glencore the right to negotiate about the amount of the navigation service charge that might be fixed by PNO when Glencore sells FOB, would be to constrain and distort the contractual choices available to Glencore as a competitor in the downstream market in which it sells its coal. The right to negotiate that arises from an expansive understanding of the meaning of "access" no doubt allows for the imagination to conjure the occurrence of multiple access disputes over access to the same service initiated by third parties at multiple points in a supply chain. Extrapolating from the circumstances of the present case, it is possible to imagine persons other than Glencore also invoking the right to negotiate with PNO about the amount of the navigation service charge applicable to the use of the shipping channels by a particular ship carrying coal sold by Glencore – for example, the shipowner and the overseas buyer, and even a customer of the overseas buyer. To imagine the prospect of practical mischief resulting from multiple access disputes is quite unreal. Once access is determined on reasonable terms and conditions, the bottleneck is unblocked. All in the supply chain benefit. The incentive for someone else in the supply chain to go to the trouble and incur the expense of invoking the right to negotiate in the hope of achieving a better arbitrated outcome must be slight. Trivial or vexatious attempts to invoke the right to negotiate can be put to one side on the basis that they are readily capable of being weeded out in the exercise by the ACCC of its power to terminate an arbitration. If overlapping substantive arbitrations of disputes over access to the same service were ever to occur, those disputes would be required to be determined by the same arbitrator – the ACCC – applying the same statutory criteria. This would mean that the chance of inconsistent final determinations would for practical purposes be non-existent. None of that is to suggest that any person who might in any way benefit economically from the use of a service provided by means of an essential facility will be a "third party" having a right to negotiate with the provider of the service. The ripples of economic affection can be far reaching. Having regard to the principal object of Pt IIIA, economic effects felt outside the chain of supply leading to competition in an upstream or downstream market lie beyond the scope of the Part. The Service as described in the Declaration The Declaration, it will be recalled, relevantly described the Service as "the provision of the right to access and use the shipping channels (including berths next to wharves as part of the channels) at the Port". Plainly, the introductory reference to "the provision of the right to access" is surplusage. Having regard to the structure of the definition of "service" set out in s 44B of the Act, the service declared by the Declaration is "the use" of an infrastructure facility constituted by the shipping channels, which are treated for the purposes of the Declaration as including the berths. In circumstances where Glencore wants to ensure that it can continue to enjoy the economic benefit that it unquestionably gets from the ability of ships, loading and carrying the coal that it sells to overseas buyers, to use the shipping channels and berths at the Port, Glencore is a person who wants "access" to the Service. Glencore is thereby a "third party". By operation of the Declaration, Glencore as a "third party" has a right to negotiate with PNO about the amount of the navigation service charge that PNO might fix for the Service. That is so whether Glencore sells FOB or CIF. By exercising the right to negotiate through notifying an access dispute about the amount of the navigation service charge payable in respect of ships carrying the coal that it sells to overseas buyers either FOB or CIF, Glencore became entitled to an arbitrated bilateral outcome. The outcome to which Glencore became entitled was no less than could have been achieved without arbitration had PNO been willing to reach an agreement with Glencore about the amount of the navigation service charge payable by Glencore as permitted under the provisions of the PMA Act. The Full Court was, on that basis and to that extent, correct to conclude that the Tribunal had erred in law in treating the permissible scope of the Final Determination as confined to circumstances where Glencore exercised some measure of control over the physical activity of moving a vessel through a shipping channel. The Full Court was therefore correct to set aside the Tribunal Decision and to remit the matter to the Tribunal for redetermination of the Final Determination. Equally, however, the arbitrated outcome to which Glencore became entitled by exercising the right to negotiate was no more than could have been achieved without arbitration had PNO been willing to reach an agreement with Glencore about the amount of the navigation service charge payable by Glencore as permitted under the provisions of the PMA Act. The Full Court would have been incorrect to the extent that its additional observations, already quoted99, might indicate that the Tribunal's re-arbitration of the access dispute could result in a determination governing the circumstances in which PNO would seek and accept payment of the Navigation Service Charge from a person other than Glencore in respect of the particular use of the shipping channels by a particular ship carrying coal sold by Glencore. Subject to the constraints of tort and competition law, and to the provision of contractual consideration, one person can ordinarily enter into a binding contract with another person about the price at which that second person will offer a service to a third person. The third person will then become liable to pay the price to the second person under a separate contract that will be formed between the second person and the third person if and when the offer is made and accepted. Here, however, the terms of the PMA Act do not permit PNO to enter into that kind of bilateral arrangement having potential consequences for a third person. It will be recalled that s 67 of the PMA Act relevantly goes no further than to permit PNO to enter into an agreement about the amount of the navigation service charge with a person who is liable to pay the navigation service charge. Absent any other person with a sufficient interest having chosen to become a party to the arbitration of the access dispute between PNO and Glencore, the only person who has the potential to become liable to pay the Navigation Service Charge as a result of the Final Determination is Glencore. When Glencore sells FOB, Glencore can answer the description of a person who is liable to pay the Navigation Service Charge only by acting to bring itself within the extended meaning of "owner" of a vessel in s 48(4)(b) of the PMA Act so as to accept the obligation to pay the Navigation Service Charge. The Tribunal on remitter must therefore be confined to determining the circumstances in which the Navigation Service Charge will be payable by Glencore to PNO. In respect of the particular use of the shipping channels by a particular ship carrying coal sold by Glencore, the concern of the Tribunal will be to work out a practical mechanism to govern when and how Glencore will invoke 99 See Glencore Coal Assets Australia Pty Ltd v Australian Competition Tribunal (2020) 280 FCR 194 at 230 [162] and 231-232 [167], quoted at [76] above. s 48(4)(b) of the PMA Act to represent to PNO that it accepts the obligation to pay the Navigation Service Charge. There is no occasion to consider the additional basis on which the Full Court concluded that the Tribunal had erred in law, which involved construing the Declaration's description of the Service as describing one indivisible use of shipping channels and loading berths. Turning as it did on the peculiar wording of a now revoked statutory instrument, that additional basis for the Full Court's conclusion raises no issue of principle. Amount of the Navigation Service Charge Section 44X(1)(e) of the Act The obligation imposed on the Tribunal by s 44X(1), to take specified matters into account in making the Final Determination, was an obligation to "give weight" to each of those matters as a "fundamental element"100 of the decision- making process in which the Tribunal engaged to arrive at the Final Determination. Provided the Tribunal so took each of the specified matters into account, how the Tribunal factored each of them into its decision-making process was a matter for it101 subject to the implied condition that its decision-making power be exercised within the bounds of reasonableness102. No issue of unreasonableness has been raised in the present case. It will be recalled that the Full Court found the Tribunal had misconstrued and misapplied s 44X(1)(e). For reasons to be explained below, the Full Court erred in its own construction of that provision. Before addressing the proper construction of s 44X(1)(e), it may be instructive to say something about the methodology that ought to be adopted by a court reviewing a decision of the Tribunal to determine whether that decision was affected by an erroneous construction. Were the reference in s 44X(1)(e) to "extensions (including expansions of capacity and expansions of geographical reach) whose cost is borne by someone 100 R v Hunt; Ex parte Sean Investments Pty Ltd (1979) 180 CLR 322 at 329. 101 Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 at 41. 102 Attorney-General (NSW) v Quin (1990) 170 CLR 1 at 36; ABT17 v Minister for Immigration and Border Protection (2020) 269 CLR 439 at 445 [3]. else" apt to encompass the creation by the State of New South Wales of the shipping channels and associated public works now used by PNO to provide the Service funded by "user contributions" from past users of the Port, a legal foundation would exist for an argument that the Tribunal, in refusing to make an allowance for the value to PNO of the shipping channels and associated public works so created, misconstrued s 44X(1)(e) in making the Final Determination in a manner that was "material" to its decision "in the sense that the decision which was in fact made by the Tribunal might have been different if the error of law had not occurred"103. Evaluation of that argument would involve an examination of the extensive reasons that the Tribunal gave for choosing not to make an allowance by adjusting the DORC downwards by reference to "user contributions" to arrive at an RAB. That reasoning would not be "construed minutely and finely with an eye keenly attuned to the perception of error" in examining whether the Tribunal in fact acted upon a misconstruction of the provision104. Consideration of the materiality of any misconstruction upon which it might be found to have acted would then fall to be undertaken mindful that the Tribunal "is constituted by a judge of the Federal Court and two experts"105, making it "well fitted to decide the issues of fact and opinion to be resolved by it", and mindful that the curial supervisory jurisdiction to correct for error of law "ought not be used as a basis for a complete re-evaluation of the findings of fact, a reconsideration of the merits of the case or a re-litigation of the arguments that have been ventilated, and that failed, before the person designated as the repository of the decision-making power"106. When s 44X(1)(e) is read within the context of Div 3 of Pt IIIA as a whole, however, it is apparent that its reference to "extensions (including expansions of capacity and expansions of geographical reach) whose cost is borne by someone 103 Comptroller-General of Customs v Pharm-A-Care Laboratories Pty Ltd (2020) 94 ALJR 182 at 192 [40]; 375 ALR 98 at 109. 104 Minister for Immigration and Ethnic Affairs v Wu Shan Liang (1996) 185 CLR 259 105 Pilbara Infrastructure Pty Ltd v Australian Competition Tribunal (2011) 193 FCR 106 Re Minister for Immigration and Multicultural Affairs; Ex parte Applicant S20/2002 (2003) 77 ALJR 1165 at 1184 [114]; 198 ALR 59 at 84 (footnotes omitted); Pilbara Infrastructure Pty Ltd v Australian Competition Tribunal (2011) 193 FCR 57 at 62 else" is a reference only to extensions undertaken for the purpose of providing a third party with access in the context of Div 3 itself. In particular, s 44X(1)(e) can be seen to form part of a coherent self-contained statutory scheme. The service provider can be required under s 44V(2)(d) to extend a facility (including under s 44V(2A) by expanding the capacity or geographical reach of the facility). But by s 44W(1)(e) and (ea) the service provider cannot be required to bear any of the costs of the extension of the facility. The third party, or an associated entity, can therefore end up bearing the costs of the extension of the facility. But by s 44W(1)(d) the third party cannot become the owner of the extension without the consent of the service provider. Section 44X(1)(e) operates in those circumstances to redress the balance by requiring the value to the service provider of an extension of the facility for which the service provider bears no cost to be brought to account in the final arbitral determination of an access dispute between the service provider and a third party. The use of the present tense in s 44X(1)(e) confirms that operation. The "someone else" to whom it refers is simply someone other than the service provider. That might be the third party in dispute with the service provider. Or it might be one or more other third parties who are currently bearing the costs of the extension of the facility by reason of one or more previous arbitral determinations. Or it may be one or more of their associated entities. Legislative history confirms that reading. Specifically, s 44X(1)(e) as originally enacted can be seen to have been framed in a manner consistent with a policy objective set out in the Competition Principles Agreement107 by which COAG had agreed that any dispute resolution body established by a State or Territory should, when deciding disputes as to third party access to services provided by means of essential infrastructure facilities, take account of "the economic value to the owner of any additional investment that the person seeking access or the owner has agreed to undertake". While the language of s 44X(1)(e) was different, as the Full Court pointed out108, and while s 44X(1)(e) forms part of a Commonwealth legislative scheme not that of a State or Territory, there is no reason to think that there was a different policy intent. The policy was consistent in 1995, and was consistently followed through in the subsequent amendment of s 44X(1)(e) in 2017. 107 Clause 6(4)(i)(iii). 108 Glencore Coal Assets Australia Pty Ltd v Australian Competition Tribunal (2020) 280 FCR 194 at 207 [51]. The 2017 Act amended s 44X(1)(e) by inserting the bracketed words. It did so as part of a suite of amendments which included the insertion of s 44V(2A) and of s 44W(1)(ea). The suite of amendments gave effect to a recommendation of the Productivity Commission in 2013 that Pt IIIA should be amended "to confirm the prevailing interpretation by the [Tribunal] that the terms 'extend', 'extensions' and 'extending' in sections 44V, 44W and 44X include expansions of a facility's capacity"109. The Productivity Commission had gone on in the recommendation to explain the intent of the amendment to be "that when making an access determination, the [ACCC] can require a service provider to expand the capacity of its facility (in addition to being able to require a geographical extension) and that the safeguards in sections 44W and 44X apply to directed capacity expansions". The Explanatory Memorandum for the 2017 Act correspondingly stated110: "The intent of these amendments is to clarify that the [ACCC] can require a service provider to expand the capacity of its facility (as well as being able to require a geographical extension) when making an access determination. The amendments also clarify that the safeguards in sections 44W and 44X apply to directed capacity extensions." The construction of s 44X(1)(e) to which the Full Court was persuaded cannot be sustained. Section 44ZZCA(a)(ii) of the Act Section 44X(1)(h) obliged the Tribunal to take the pricing principles specified in s 44ZZCA into account in making the Final Determination. The Tribunal in fact took the pricing principle specified in s 44ZZCA(a)(i) into account when it adopted the BBM allowing for an MAR providing for an ROC to be calculated by reference to an RAB valued using a DORC methodology. The Tribunal in fact took the pricing principle specified in s 44ZZCA(a)(ii) into account when it took regulatory and commercial risk into account in determining the WACC considered appropriate to be used as the applicable ROC. Section 44ZZCA(a)(ii) simply did not bear on the issue addressed by the Tribunal 109 Productivity Commission, National Access Regime, Inquiry Report No 66 (2013) at 110 Australia, House of Representatives, Competition and Consumer Amendment (Competition Policy Review) Bill 2017, Explanatory Memorandum at 109. concerning whether the RAB as valued using a DORC methodology should be adjusted downwards by reference to user contributions. The Full Court was mistaken to think that the application, through s 44X(1)(h), of s 44ZZCA(a)(ii) required more of the Tribunal than what the Tribunal in fact did. Conclusion The upshot is that the Full Court was wrong to discern legal error on the part of the Tribunal in relation to the amount of the Navigation Service Charge, but that the Full Court was right to discern legal error on the part of the Tribunal in relation to the scope of the Navigation Service Charge. The Tribunal's error in relation to the scope of the Navigation Service Charge was alone sufficient to justify the order of the Full Court setting aside the Tribunal Decision and remitting the matter to the Tribunal for determination according to law. That order must stand. For the avoidance of doubt, it will be supplemented with a direction making clear that the Tribunal will be confined on remitter to redetermining the scope of the Navigation Service Charge. For reasons already given, the redetermination of the scope of the Navigation Service Charge according to law will not extend beyond determining when and how Glencore will be obliged to pay the Navigation Service Charge to PNO consistently with the terms of the PMA Act. As Glencore and PNO have each had a significant measure of success on the appeal, each should bear its own costs of the appeal and there should be no disturbance of the orders for costs made by the Full Court. The ACCC should bear its own costs in any event. In the result, the orders made by the Full Court will be varied to include a direction confining the Tribunal on remitter to redetermining the scope of the Navigation Service Charge. The appeal will otherwise be dismissed with no order as to costs.

HIGH COURT OF AUSTRALIA WARREN HALLORAN AND THE PERSONS NOMINATED IN THE ATTACHED SCHEDULE OF OWNERSHIP APPELLANTS AND MINISTER ADMINISTERING NATIONAL PARKS AND WILDLIFE ACT 1974 RESPONDENT Halloran v Minister Administering National Parks and Wildlife Act 1974 [2006] HCA 3 9 February 2006 ORDER Vary Order 2 of the Court of Appeal of the Supreme Court of New South Wales entered on 17 August 2004, so as to read: "Declare that upon the admissible evidence tendered at the proceeding before Talbot J the applicant, Pacinette Pty Ltd, has not established that it is the owner of an interest in the land the subject of the Notice of Acquisition published in the Government Gazette dated 19 June 1998 and is entitled for the purposes of these proceedings to maintain its claim under s 37 of the Land Acquisition (Just Terms Compensation) Act 1991 in respect of nominated lots 140, 1629 and 1063." Vary Order 3 of the Court of Appeal of the Supreme Court of New South Wales entered on 17 August 2004, so as to read: "Declare that upon the admissible evidence tendered at the proceeding before Talbot J, the Beneficial Ownership Claimants in Class 2 referred to in the Amended Points of Claim dated 28 December 2000 have not established that they are entitled to maintain claims under s 37 of the Land Acquisition (Just Terms Compensation) Act 1991 in respect of land resumed by Notices of Acquisition published in the Government Gazette on 19 June 1998 and on 18 September 1998." Otherwise, appeal dismissed with costs. On appeal from the Supreme Court of New South Wales Representation: S D Rares SC with R G McHugh for the appellants (instructed by Blake Dawson Waldron) A H Slater QC with H R Sorensen for the respondent (instructed by Crown Solicitor for New South Wales) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Halloran v Minister Administering National Parks and Wildlife Act 1974 Compulsory acquisition – Compensation – Minister acquired land by compulsory process pursuant to Land Acquisition (Just Terms Compensation) Act 1991 (NSW), s 19 – Where land comprised many individual parcels each of which was a separate lot in a deposited plan – Transactions purportedly undertaken with the effect that lots beneficially held by a small number of registered proprietors were distributed among a larger number of equitable owners ("May 1998 transactions") – May 1998 transactions included dealings between Sealark Pty Ltd ("Sealark") and Pacinette Pty Ltd ("Pacinette") – Sealark held equitable interest in land – Pacinette constituted as trustee of unit trust in which Ordinary Class and A Class units could be allotted – A Class unit holders entitled to fractional interest in assets received in consideration of the allotment of the units, which assets were to form a separate fund to the ordinary fund – Pacinette as trustee empowered to redeem A Class units – A Class units intended to be allotted to Sealark in consideration of the transfer of Sealark's interest in the land to Pacinette as trustee – Pacinette intended to acquire equivalent number of Ordinary Class units paid for by bill of exchange drawn by Pacinette on Sealark as an accommodation party – Sealark intended to redeem all A Class units and Pacinette to pay redemption moneys by endorsing bill of exchange to Sealark – Assets of A Class fund were thereby to become assets in the ordinary fund the entire equitable interest in which was vested in Pacinette – Whether transactions effective in law – Whether claimants for compensation had an equitable interest in the land compulsorily acquired. Company law – Meetings – Transaction between Sealark and Pacinette was one of 770 similar transactions which made up the May 1998 transactions – Documents for the May 1998 transactions were mostly signed in one sitting in the offices of the appellants' solicitors, where those documents included minutes of meetings of the boards of directors of both Sealark and Pacinette – Whether evidence disclosed that May 1998 transactions occurred – Whether the meetings said to be recorded in the minutes occurred. Statute of frauds – Requirement of writing – Disposition of equitable interests – Whether requirements of Conveyancing Act 1919 (NSW), s 23C(1)(c) were complied with in the course of dealings between Sealark and Pacinette. Bills of exchange – Delivery – Negotiation by indorsement and delivery – Whether bill of exchange tendered in payment for units – Whether bill of exchange negotiated by indorsement and delivery – Whether mere intention to take steps involving tender and negotiation of bill of exchange sufficed to effectuate equitable transfer of interest in land to Pacinette. Stamp duty – May 1998 transactions designed to ensure that Stamp Duties Act 1920 (NSW) ("Stamp Duties Act"), Pt 3, Div 3A was inapplicable to those transactions – No duty paid on those transactions – Whether transactions dutiable – Whether change in beneficial ownership occurred as a result of transfer by Sealark of its interest in the land to Pacinette as trustee in consideration of the issue of A Class units – Whether no change in beneficial ownership because Sealark was sole unit holder of A Class units – Whether change in beneficial ownership occurred as the consequence of the issue or redemption of units in a unit trust scheme for the purposes of s 44(2)(d) of the Stamp Duties Act – Whether s 29(3) of the Stamp Duties Act applied to bar admission of any documentary evidence to prove the transaction creating the equitable interests in the land in proceedings for compensation for compulsory acquisition of the land. Words and phrases – "beneficial ownership", "occurring as the consequence of the issue or redemption of units in a unit trust scheme". Bills of Exchange Act 1909 (Cth), s 33(1). Conveyancing Act 1919 (NSW), s 23C(1)(c). Land Acquisition (Just Terms Compensation) Act 1991 (NSW), ss 19, 20, 37. Land and Environment Court Act 1979 (NSW), s 57(1). Stamp Duties Act 1920 (NSW), ss 29(3), 44-44F. GLEESON CJ, GUMMOW, KIRBY AND HAYNE JJ. The respondent, the Minister administering the National Parks and Wildlife Act 1974 (NSW) ("the Minister"), is an "authority of the State" within the meaning of the Land Acquisition (Just Terms Compensation) Act 1991 (NSW) ("the Compensation Act"). Section 19 of that statute empowers an authority of the State to acquire land by compulsory process with the effect, given by s 20, that the land vests in the acquiring authority "freed and discharged from all estates, interests, trusts, restrictions, dedications, reservations, easements, rights, charges, rates and contracts in, over or in connection with the land". Section 37 of the Compensation Act confers upon "[a]n owner of an interest in land" which has been divested, extinguished or diminished by the acquisition, an entitlement the acquiring authority of to payment by compensation. The expression "[a]n owner of an interest in land", as a consequence of definitions in s 4, identifies any person who has "a legal or equitable estate or interest in the land" or "an easement, right, charge, power or privilege over, or in connection with, the land". The appellants assert entitlements to compensation under s 37 of the Compensation Act, which the Minister disputes. It should be noted that the compulsory acquisition is effected on the date of publication in the New South Wales Government Gazette ("the Gazette") of an acquisition notice (s 20). In February 1997, the Director-General of National Parks and Wildlife had been served with notices requesting acquisition of the land in question in this case. Thereafter, and following urging by the appellants that the matter be expedited, by notices published in the Gazettes of 19 June 1998 and 18 September 1998, there was vested in the Minister by the compulsory processes of the Compensation Act parcels of land totalling about 2,639 hectares. The land was acquired for the Jervis Bay National Park. The situation of the land adjacent to Jervis Bay has the significance that will now be described. The resumed land The resumed land included parcels in various certificates of title issued under the provisions of the Real Property Act 1900 (NSW) ("the RP Act"). There was a large number, said to be several thousands, of parcels of land each of which was a separate lot in a deposited plan. Few, if any, of the lots of a suitable size for development as dwellings have ever been so occupied and the development of the land does not reflect this state of subdivision. This state of affairs provided the occasion for the transactions to which reference will be made, undertaken with a view to the obtaining for the appellants of a greater measure of compensation on resumption than that which otherwise Kirby Hayne would have been payable. The reasons for the existence of that state of affairs are found in the history of the Jervis Bay area. The Jervis Bay Territory Acceptance Act 1915 (Cth) ratified and confirmed an agreement between the Commonwealth and the State of New South Wales for the surrender to and acceptance by the Commonwealth of territory to be annexed to, and to form part of, what was then known as the Territory acquired by the Commonwealth for the Seat of Government (s 4)1. In the Second Reading Speech in the House of Representatives on the Bill for that statute, the responsible Minister said that the Royal Australian Naval College was already situated within the area in question and that in due course other buildings such as dockyards would be constructed there2. It appears that a large tract of land to be retained within New South Wales was subdivided into parcels of a suitable size for town development to support the development of the proposed port in the federal Territory. The anticipated town development did not take place. It may be noted that, in its form as enacted in 1900, s 113 of the RP Act had provided for the deposit with the Registrar-General of a map showing allotments into which the land for a proposed township was divided. Section 113 was repealed by s 196(12) of the Conveyancing Act 1919 (NSW) ("the Conveyancing Act"). The modern New South Wales system of subdivision and deposited plans was not introduced until 19193. The litigation The Compensation Act deals with compensation claims by a system of objections and appeals to the Land and Environment Court of New South Wales4. The appellants appeal to this Court against a decision of the New South Wales Court of Appeal (Spigelman CJ, Ipp and Bryson JJA)5 allowing an appeal by the 1 The Commonwealth v Woodhill (1917) 23 CLR 482 at 486. 2 Australia, House of Representatives, Parliamentary Debates (Hansard), 8 July 3 By s 196 of the Conveyancing Act and Pt XII (ss 320-342) of the Local Government Act 1919 (NSW). 4 Pt 3, Div 5 (ss 66-68). 5 Minister Administering National Parks and Wildlife Act 1974 v Halloran (2004) 12 BPR 22,391. Kirby Hayne Minister against orders made by the Land and Environment Court (Talbot J) in compensation proceedings6. Limited provision for an appeal to the Court of Appeal was made by the Land and Environment Court Act 1979 (NSW). Section 57(1) of that statute conferred a right to appeal "on a question of law". One of the complaints made by the appellants in this Court is that the Court of Appeal itself engaged in fact- finding and thus exceeded its statutory mandate. The proceedings in the Land and Environment Court Talbot J required the appellants (the applicants in that Court) to deliver points of claim that identified the value of the claims they made, the components of the claim, and the basis of the valuations relied on. This was done by dividing the land into a number of different categories and the appellants into three different classes – "bare trustee claimants", "beneficial ownership claimants" and "registered proprietors with beneficial ownership". For present purposes, the categories into which the land was divided may be ignored. Attention must be given to land, of any category, in respect of which the second class of appellants (the "beneficial ownership claimants" or "class 2 claimants" as they were called in the proceedings in the Land and Environment Court) claimed to have a beneficial interest. Pacinette Pty Ltd ("Pacinette") was one of these class 2 claimants. By consent of the parties, Talbot J ordered, on 27 October 1999, that there be determined, as a separate question, whether Pacinette established, on the evidence led at the hearing of the question, that it is an owner of an equitable interest in three lots the subject of the first of the two notices of acquisition, that which appeared in the Gazette of 19 June 1998. By order made on 9 December 1999 the separate question was answered in the affirmative7. The Minister then sought to reagitate that question before Talbot J, at least in so far as it was to be understood as deciding whether other class 2 claimaints had obtained an equitable interest in land the subject of either acquisition. 6 Halloran and Sealark Pty Ltd v Minister Administering National Parks and Wildlife Act 1974 (1999) 105 LGERA 405; Halloran v Minister Administering the National Parks and Wildlife Act 1974 [2003] NSWLEC 171. 7 Halloran and Sealark Pty Ltd v Minister Administering National Parks and Wildlife Act 1974 (1999) 105 LGERA 405 at 426. Kirby Hayne Talbot J declined to permit that to be done, holding that the earlier judgment precluded the Minister from contending that other class 2 claimants had not obtained the equitable interests each claimed8. The upshot was that the two proceedings before Talbot J established the entitlement of each class 2 claimant, and all those entitlements have been involved in the subsequent appeals to the Court of Appeal and this Court. The Court of Appeal By leave, the Minister appealed to the Court of Appeal against both the interlocutory order made by Talbot J on 9 December 1999 answering the separate question, and the order made by Talbot J on 17 July 2003 on the motion in which the Minister had sought to reagitate the issue determined in Pacinette's case in its application to other class 2 claimaints. The Court of Appeal allowed the Minister's appeal9. The central conclusion reached by Bryson JA (with whose reasons Spigelman CJ and Ipp JA agreed) was that the appeal be allowed for the reason that the transactions which the appellants alleged had taken place in May 1998 had not occurred. Bryson JA said10: "On [the] evidence the only conclusion reasonably available is that the meetings did not occur, the written offers which were purportedly authorised were not delivered and the oral acceptances on which the scheme depends were never made." The appellants complain fact-finding by the Court of Appeal. that this statement represented impermissible The Court of Appeal set aside the answer given by Talbot J to the separate question. In its place the Court of Appeal ordered that there be a declaration that Pacinette is not the owner of an interest in the land the subject of the notice of acquisition, and is not entitled, for the purposes of the proceedings in the Land and Environment Court, to maintain its claim under s 37 of the Compensation 8 Halloran v Minister Administering the National Parks and Wildlife Act 1974 [2003] NSWLEC 171. 9 Minister Administering National Parks and Wildlife Act 1974 v Halloran (2004) 12 BPR 22,391. 10 (2004) 12 BPR 22,391 at 22,413. Kirby Hayne Act. The Court further ordered that there should be a declaration that the other class 2 claimants are not entitled to maintain claims under s 37 of the Compensation Act in respect of land the subject of either of the notices of acquisition. By special leave the appellants now appeal to this Court. The questions of preclusion considered by Talbot J at the second hearing do not arise in this Court. The fiscal considerations The present appellants claimed compensation of more than $46.7 million. They alleged that some of those individuals and companies included as appellants held no more than a bare legal title to parts of the resumed land but that the remaining appellants (all of them corporations controlled by the first appellant, Mr Warren Halloran) had at the date of the relevant notice in the Gazette an equitable interest in one or more of the parcels of land which thereby attracted an entitlement to compensation under s 37 of the Compensation Act. The equitable interests in question were said to have been created or acquired as a result of events occuring during May 1998. This was after the giving of the initial notices in February 1997, to which reference has been made, and after the scheme of arrangement, to which reference will be made. In the approach that we take, the question for this Court is whether the Court of Appeal erred in concluding that the appellants had not established, within the available evidence, as a result of the May events described by the Minister as steps taken in pursuance of a "scheme", that the equitable interest had been created or acquired so as to attract the entitlement to compensation upon subsequent resumption. It will be necessary to refer to the events of May 1998 in fuller detail. At this point it is to be emphasised that what was done was informed by two particular fiscal considerations. The first was identified by Bryson JA as follows11: "The general effect of these transactions is that whereas earlier a small number of registered proprietors each held a large number of lots in deposited plans, now each of 283 different equitable owners owns a number of non-contiguous lots. Underlying these events is the view that if compensation is assessed on proper principles a larger sum in total would 11 (2004) 12 BPR 22,391 at 22,393. Kirby Hayne be payable to the many claimants who each hold non-contiguous lots than will have been payable to a small number of claimants who held the same lots agglomerated into large contiguous parcels." The second fiscal consideration was the incidence of stamp duty imposed by Div 3A of Pt 3 of the Stamp Duties Act 1920 (NSW) ("the Stamp Duties Act") with respect to the steps taken in May 1998 to vest an equitable interest in the non-contiguous parcels of land. Division 3A (ss 44-44F) departs from the traditional form of stamp duty legislation by in substance imposing a duty on transactions rather than instruments. In Chief Commissioner of Stamp Duties v ISPT Pty Ltd12, Mason P described Div 3A as an anti-avoidance measure designed to strike at a broad sweep of tax avoidance schemes, some of which had been described in the Second Reading Speech on the Bill for the Stamp Duties (Amendment) Act 1987 (NSW). Among other situations, Div 3A applies to "a transaction which ... causes or results in a change in the beneficial ownership of an estate or interest in ... land situated in New South Wales" (s 44(1)(a)). However, this reference to a change in beneficial ownership does not include such a change "occurring as the consequence of ... the issue or redemption of units in a unit trust scheme" (s 44(2)(d))13. A party to a transaction to which Div 3A applies which is not effected or evidenced by an instrument chargeable with ad valorem duty as, or as on, a conveyance, which that person would have been liable to pay, is obliged by s 44A(1) to lodge a statement with respect to the transaction; this is then deemed to be a chargeable instrument (s 44A(5)). No unstamped instrument in respect of a transaction to which Div 3A applies but for which there has been no compliance with s 44A shall in non-criminal proceedings be pleaded or given in evidence for the purpose of proving that a change in the beneficial ownership to which the transaction relates 12 (1998) 45 NSWLR 639 at 642. 13 The expression "Unit trust scheme" is defined in s 3(1) as meaning: "any arrangements made for the purpose, or having the effect, of providing, for persons having funds available for investment, facilities for the participation by them, as beneficiaries under a trust, in any profits or income arising from the acquisition, holding, management or disposal of any property whatsoever pursuant to that trust". Kirby Hayne occurred (s 29(3)). Thus, s 29(3) "strikes that instrument with sterility ... unless and until the public requirement of taxation has been complied with"14. The sequence of steps taken in May 1998 and their form were designed by the appellants to attract the holding by the majority of the Court of Appeal (Meagher JA and Fitzgerald A-JA; Mason P dissenting) in ISPT that the particular transaction in issue in that case did not attract duty under Div 3A. However, three points should be made. The first is that, after a detailed analysis of ISPT in the later case of ISPT Nominees Pty Ltd v Chief Commissioner of State Revenue (NSW)15, Barrett J concluded16 that he was bound by the Court of Appeal's decision only in so far as it included a decision that the transaction in question there did not engage s 44(1) of the Stamp Duties Act, and that there was no majority view on questions respecting formalities for the creation of trusts and the characteristics of sub-trusts. The second is that ISPT involved consideration of unit trust deeds but in advance of the decision of this Court in CPT Custodian Pty Ltd v Commissioner of State Revenue17. Further reference will be made to CPT later in these reasons. The third is that success of the avoidance scheme implemented in ISPT depended on a matter of timing. As Mason P pointed out18, it was critical to the taxpayer's argument based on s 44(2)(d) that no change in beneficial ownership occurred until step 7 of the 11 steps listed by him19. Hence the importance of sequence. The purely equitable nature of the interest held by Sealark Pty Ltd ("Sealark") (to which further reference will also be made) further distinguishes the facts of this case from those in ISPT. There, Coles Myer Property Investments Pty Ltd ("CMP") had been the owner of the shopping centres at Forster and Bondi Junction20. As such, it was inaccurate to speak of CMP as the 14 Dent v Moore (1919) 26 CLR 316 at 324. 15 [2003] ATC 4,697 at 4,734-4,744. The judgment of Barrett J is incompletely reported (2003) 59 NSWLR 196. 16 [2003] ATC 4,697 at 4,744. 17 (2005) 79 ALJR 1724; 221 ALR 196. 18 (1998) 45 NSWLR 639 at 645. 19 (1998) 45 NSWLR 639 at 643-644. 20 (1998) 45 NSWLR 639 at 642-643, 655. Kirby Hayne owner of a distinct legal and beneficial title or interest; it had the whole right of property in the land21. In response to the oral submissions for the appellants in this Court, the Minister submitted that (a) as just remarked, it was difficult to discern any true ratio decidendi in the majority reasons in ISPT, (b) there were material differences between the steps taken in ISPT and those in the present case, particularly with the purported use of an accommodation bill of exchange, (c) the Minister reserved the State's position as to the incidence of stamp duty upon a transaction which differed from the ISPT transaction, and (d) if, as the appellants had contended in oral submissions, there had been a "direct passage" of beneficial ownership from Sealark to Pacinette by what was called the "first event", Div 3A of Pt 3 of the Stamp Duties Act would have applied; in the absence of compliance with s 44A, the "sterilisation" provision of s 29(3) of that statute would bar the admission of any documentary evidence to prove the transaction in the compensation proceedings. The propositions respecting the Stamp Duties Act upon which the Minister now relies are of a technical legal nature. Talbot J dealt with the admissibility of documents, in the light of Div 3A of Pt 3 of the Stamp Duties Act, in his first judgment, that upon the separate question. His Honour admitted the documents, having regard, in particular, to what appeared to follow from ISPT. There can be no successful objection to the Minister advancing them if, although in play before Talbot J, the stamp duty issues were not pressed in the Court of Appeal. The appellants referred to a letter dated 25 March 2004, post-dating the proceedings before Talbot J but received in evidence in the Court of Appeal, in which the Chief Commissioner of State Revenue had indicated that there was no liability under Div 3A in respect of "the Pacinette transaction". That indication cannot bind the Minister in the present litigation which concerns the operation of the Compensation Act. This is so particularly where, as will be made apparent later the Chief Commissioner was encouraged by the appellants to act, namely that all of the steps proposed to be taken in May 1998 had been taken, is shown to be false. the evident assumption upon which these reasons, 21 DKLR Holding Co (No 2) Pty Ltd v Commissioner of Stamp Duties (NSW) (1982) 149 CLR 431 at 442, 463, 473-474; CPT Custodian Pty Ltd v Commissioner of State Revenue (2005) 79 ALJR 1724 at 1729 [25]; 221 ALR 196 at 202-203. Kirby Hayne It is yet to be decided whether the amount of compensation will be increased by the segmentation of the land into non-contiguous lots. This is because both in the interlocutory proceedings in the Land and Environment Court and in the Court of Appeal argument has turned on the resolution of the separated question relating to the efficacy of the steps taken in May 1998 to vest in Pacinette a distinct equitable (and compensable) interest in each of its non-contiguous parcels of land. Later in these reasons, under the heading "Conclusions", it will be necessary to consider the significance of the outcome of the appeal in this Court for further proceedings in the Land and Environment Court. As has been noted, the position of Pacinette has been treated as representative of the entitlement of the class 2 claimants. Something more needs to be said of Pacinette. There were three lots of land dealt with in the first of the notices of acquisition, that of 19 June 1998, and in the first proceeding before Talbot J. Before 12 December 1997, the registered proprietor in respect of each lot was Port Stephens Development Pty Ltd ("Port Stephens"). By order of the Federal Court of Australia made that day and entered on 19 December 1997, the Court approved a scheme of arrangement and ordered that the whole of the undertaking, property and liabilities of Port Stephens be transferred to Sealark. The Court also ordered that Port Stephens be dissolved without winding up. These orders were expressed as having been made pursuant to ss 411 and 413 of the "Corporations Law". The reference is to be taken as invoking (a) the application in New South Wales, by force of s 7 of the Corporations (New South Wales) Act 1990 (NSW), of the Corporations Law ("the Law") as set out in s 82 of the Corporations Act 1989 (Cth), and (b) the exercise of the jurisdiction purportedly conferred upon the Federal Court by s 42(3) of the State statute as originally enacted. The making of these Federal Court orders preceded the decisions of this Court in Re Wakim; Ex parte McNally22 and Re Macks; Ex parte Saint23. The upshot of these decisions is that, by the valid operation of s 6 of the Federal Courts (State Jurisdiction) Act 1999 (NSW), the rights and liabilities of all persons are and always have been the same as if the order made by the Federal 22 (1999) 198 CLR 511. 23 (2000) 204 CLR 158. Kirby Hayne Court with respect to Port Stephens had been a judgment of the Supreme Court of New South Wales ("the Supreme Court"). Section 86 of the RP Act authorised the Registrar-General to record a court order which had been served upon the Registrar-General and which vested in any person land under the provisions of the RP Act, whereupon that person would become the registered proprietor. Section 46C empowered the Registrar- General on the Registrar-General's own motion, and obliged the Registrar- General when given a written request, to register a person vested by the operation of a statute. At the time of the preparation of an agreed statement of facts for the second hearing by Talbot J in 2003 no entries had been made in respect of the vesting of land in the Minister pursuant to the 1998 acquisition notices. At the time of the May 1998 transactions and the date of the acquisition notices, the registered proprietor of the lots in question was still shown as Port Stephens. Sealark was not registered as proprietor until 2 October 1998. The transfers by which the registration of Sealark was achieved were expressed as made pursuant to the order of the Federal Court and on their face were executed under the common seal of Port Stephens on 5 March 1998. Section 413 of the Law, which it must be remembered is to be treated as a law of New South Wales, indicates that, by virtue of what is now the deemed order of the Supreme Court, the property in question was transferred to and vested in Sealark. The order in terms was expressed as effecting a transfer to Sealark pursuant to s 413. However, there was some consideration in argument as to whether the appropriate provision of the Law was not s 413 but s 1336. The latter is a generally expressed provision dealing with the vesting of property pursuant to court orders. Section 1336 makes it clear that, where a transfer or transmission may be registered under a law such as the RP Act, the property does not vest at law until those registration requirements are satisfied although it has earlier vested in equity. With respect to the land registered under the provisions of the RP Act, references to vesting at law and vesting in equity are apt to mislead. The Torrens system is one of title by registration, not of registered title24. The assimilation of the registered title to a legal title may be convenient so long as it is appreciated what is involved. It is likewise with respect to the use of the term "equitable" to 24 Breskvar v Wall (1971) 126 CLR 376 at 385; Figgins Holdings Pty Ltd v SEAA Enterprises Pty Ltd (1999) 196 CLR 245 at 264 [27]. Kirby Hayne describe interests recognised in accordance with the principles of equity but not found on the Register25. As has been explained, whether the relevant vesting section with respect to the order was s 413 or s 1336 of the Law, these provisions were made by New South Wales statute law, to be read with the basic provisions of another law of that State, namely the RP Act26. The vesting referred to in s 413, unlike that in s 1336, in terms does not refer to unregistered or equitable interests. However, that is how both provisions should be understood when read with the RP Act. This apparent digression is of importance for the present case. At the time of the May transactions and the date of the first acquisition notice, 19 June 1998, Sealark was not the registered proprietor of the three lots in which Pacinette later claimed to have had an interest. At best, as the appellants conceded in argument, Sealark had an unregistered, and, in that sense, an equitable interest. The compensation claim which Pacinette made thus could only be in respect of an equitable interest acquired or derived from the equitable interest of Sealark. The question then becomes one of the legal efficacy in the compensation proceedings of the steps by which, before the resumption date of 19 June 1998, Sealark dealt with its equitable interest. Did these steps lead to the result that on 19 June 1998 Pacinette had an equitable interest in the lots? To consideration of those steps we now turn. The events of May 1998 Creation of unit trusts On 6 May 1998, Mr Philip Howell, a director of both Pacinette and Sealark, gave a power of attorney to a Canberra solicitor, Mr Gerald Santucci, authorising Mr Santucci to execute trust deeds on his behalf. Seven hundred and seventy trust deeds were prepared including deeds for a trust to be established by Mr Howell as settlor to be called The Pacinette Property Trust. Pacinette was to be the trustee of the trust. 25 Chan v Cresdon Pty Ltd (1989) 168 CLR 242 at 256-257, 261. 26 See Shergold v Tanner (2002) 209 CLR 126 at 136-137 [34]-[35]; cf South-Eastern Drainage Board (SA) v Savings Bank of South Australia (1939) 62 CLR 603 at 622, 630, 635; Travinto Nominees Pty Ltd v Vlattas (1973) 129 CLR 1 at 33-35. Kirby Hayne On 5 May 1998, $7,680 had been deposited to a bank account as the settlement sum of $10 in respect of 768 of the trusts. Subsequently, a further $20 was deposited. The evidence does not reveal which two trusts were the subject of the second deposit of $20, but nothing was said to turn on this. On 9 May 1998, Mr Santucci, as attorney for Mr Howell, executed the 770 deeds of trust. The Pacinette Property Trust Deed The Pacinette Property Trust Deed ("the Pacinette Trust Deed") provided that the trustee (Pacinette) would hold the capital and income of the "Trust Fund" (all the property held by the trustee upon the trusts of the deed) on trust for the "Registered Holders in proportion to the number of Units held by them, subject to the rights and restrictions specified in the Schedule for A Class units". A "Registered Holder" was defined as "the person for the time being registered under the provisions of this Deed as the holder of a Unit and includes persons jointly registered". The deed obliged the trustee to "keep and maintain an up-to- date register of all Registered Holders" showing certain information. The Pacinette Trust Deed provided that initially there should be two classes of units – Ordinary Class and A Class. No special rights or restrictions attached to Ordinary Class units; A Class units had the rights, and were subject to the restrictions, specified in the schedule to the deed. Those rights and restrictions were as follows: If the trustee allotted A Class units, the cash or property received in consideration of the allotment was to form a separate fund (the "A Fund"). A Class unit holders were entitled to a fractional interest in the corpus of the A Fund. A Class unit holders were not entitled to any interest in the assets of the Trust Fund, and Ordinary Class unit holders were not entitled to any interest in the assets of the A Fund. The trustee was empowered, on the request of an A Class unit holder and without the consent of Ordinary Class unit holders, to redeem units held by an A Class unit holder at a price of $1 per unit. There could be no redemption of A Class units unless all the units of that class were redeemed at the same price. Upon redemption of the A Class units, the assets previously part of the A Fund ceased to be assets of that fund and became a part of the Trust Fund. The deed provided that Sealark was to be the Registered Holder of the initial 10 A Class units. Kirby Hayne Subject to the rights and restrictions attaching to the A Class units, the Pacinette Trust Deed further provided that every unit conferred an interest in the Trust Fund, but did not confer any interest in any particular part of the Fund or any investment27. The appellants submitted that the Pacinette Trust Deed permitted Pacinette, as trustee, to deal with itself by issuing units to itself, redeeming those units, or dealing with property held or to be held by Pacinette in its capacity as trustee. The respondent did not submit to the contrary and questions of self-dealing may be set aside from further consideration. The scheme It is necessary, at this point, to distinguish between the several steps the appellants thereafter sought to take and what was done. Before spelling out the steps that were intended, it is as well to describe the essence of the intended scheme. It was: Land of which Port Stephens was registered proprietor would be vested in Sealark by order made on approval of a scheme of arrangement between Port Stephens and its members. Sealark (holder of the 10 issued A Class units in The Pacinette Property Trust) would, by acceptance of a written offer made by Pacinette, sell its land to Pacinette, as trustee, in consideration of the issue to Sealark of a further 79,000 A Class units and the land would be an asset of the A Fund. Pacinette, personally, would acquire 79,010 Ordinary Class units in The Pacinette Property Trust and pay for those units by a bill of exchange drawn by Pacinette on Sealark, for an amount of $79,010, accepted by Sealark as an accommodation acceptor, and payable on demand to Sealark would redeem all its A Class units and Pacinette would pay the redemption moneys by endorsing the bill of exchange to Sealark. Because all the A Class units were redeemed, what had been an asset in the A Fund (the land) would become an asset in the Trust Fund. 27 cf CPT Custodian Pty Ltd v Commissioner of State Revenue (2005) 79 ALJR 1724 at 1728 [18]-[21]; 221 ALR 196 at 201-202. Kirby Hayne Pacinette as trustee would sell the land to Pacinette in its personal capacity, in consideration of the redemption of all the units Pacinette held in the trust (79,010 Ordinary Class units). Section 23C of the Conveyancing Act requires, among other matters28, that a disposition inter vivos of an equitable interest subsisting at the time of the disposition "must be in writing" signed by the disponer or the agent of the disponer lawfully authorised in writing (s 23C(1)(c)); but this requirement "does not affect the creation or operation of resulting, implied, or constructive trusts" (s 23C(2)). Nothing in s 23C affects "the operation of the law relating to part performance" (s 23E(d)). Section 54A is a distinct provision29. It is concerned not with dispositions but with the bringing of actions upon contracts for the sale or other disposition of land or any interest in land; the requirement in s 54A(1) for a signed memorandum or note does not affect the law relating to part performance (s 54A(2)). The focus of the Minister's submissions was on s 23C rather than s 54A. The steps described above were designed on the expressed assumption, erroneous for the reasons given, that the subject of the sale to Pacinette as trustee (point (b)) was ownership of the land the subject of the scheme of arrangement, rather than an unregistered or subsisting equitable interest therein within the terms of s 23C(1)(c) of the Conveyancing Act. The desired outcome in point (f), if the trust property be properly identified, was that the whole of the equitable interest in the land was thereby vested in Pacinette, freed from any trust obligation of Pacinette in respect of it and compensable under s 37 of the Compensation Act. On one view, the scheme represented by these steps failed by reason of misidentification of the subject-matter. But the ultimate issue concerns the existence of a compensable interest in Pacinette at the resumption date. The 28 Paragraph (a) of s 23C(1) deals with the creation or disposition of an interest in land and par (b) with declarations of trust respecting any land or any interest therein; the content of the writing requirement is not expressed in the same way in pars (a), (b) and (c), which may make significant the suggested overlap between the other terms of the three paragraphs: see Adamson v Hayes (1973) 130 CLR 276. The present appeal may be determined without embarking upon those questions. 29 See Theodore v Mistford Pty Ltd (2005) 79 ALJR 1503 at 1505 [4], 1508 [29]; 219 ALR 296 at 298, 303. Kirby Hayne appeal may be considered on the footing that what was proposed and what was actually done was in respect of properly identified subject-matter. that for Pacinette The Minister emphasises to have acquired a compensable interest in the resumed land it was necessary to establish the occurrence of two sequential events. The "first event" was that the interest of Sealark had become an asset of The Pacinette Property Trust (point (b)). If that cannot be established by the appellants, then the second event would not be material because of the lack of the necessary subject-matter in that trust. The "second event" is the issue and redemption of units leading to point (f). The particular intended steps First, there were five steps intended to set up The Pacinette Property Trust and issue A Class units to Sealark. Those steps were: (i) Mr Howell would request Pacinette to accept appointment as trustee of The Pacinette Property Trust and pay the settlement sum. The directors of Sealark (Mr Halloran and Mr Howell) would resolve to accept the issue of 10 A Class units at $1 per unit in The Pacinette Property Trust. (iii) Sealark would execute an acceptance of the 10 A Class units. (iv) The directors of Pacinette (Mr Halloran and Mr Howell) would resolve that the company accepted appointment as trustee, and accepted the tender of the settlement sum, and would resolve that the company apply the settled sum to the issue of 10 A Class units to Sealark and issue a Unit Certificate to Sealark. Pacinette would issue a Unit Certificate to Sealark. Then there were to be a further 18 steps intended to vest in Pacinette the beneficial interest in land previously owned by Sealark. Steps (vi)-(x) together constituted the "first event" identified in the Minister's submissions, and the balance the "second event". (vi) The directors of Pacinette, as trustee for The Pacinette Property Trust, would resolve to make a written offer to buy the land in consideration of the allotment to Sealark of 79,000 $1 A Class units in The Pacinette Property Trust and to authorise Mr Howell to execute that offer on behalf of Pacinette as trustee and deliver it to Sealark. Kirby Hayne (vii) The written offer, executed by Mr Howell on behalf of Pacinette, would be delivered to Sealark. (viii) The directors of Sealark would resolve to accept the offer and authorise Mr Howell to inform a meeting of the trustee of The Pacinette Property Trust of its acceptance. (ix) The directors of Pacinette would resolve to allot 79,000 $1 A Class units in The Pacinette Property Trust to Sealark and issue a Unit Certificate. The Unit Certificate would be issued. (xi) The directors of Pacinette would then resolve to apply for 79,010 $1 Ordinary Class units in The Pacinette Property Trust and authorise Mr Howell to execute the necessary application. (xii) Mr Howell would execute the necessary application by Pacinette for those units. (xiii) Pacinette would pay for the Ordinary Class units by a bill of exchange drawn by Pacinette on Sealark in an amount of $79,010, accepted by Sealark as an accommodation acceptor, and payable on demand to (xiv) The directors of Sealark would then resolve to ask for redemption of all the A Class units at a price of $1 and authorise Mr Howell to execute the necessary request for redemption. (xv) Mr Howell would execute the necessary request for redemption. (xvi) The directors of Pacinette, as trustee, would resolve: to allot 79,010 Ordinary Class units in The Pacinette Property Trust to redeem all the A Class units in the trust held by Sealark. (xvii) Pacinette, as trustee, would then indorse the bill of exchange to Sealark and satisfy payment of the redemption proceeds in this way. (xviii) Pacinette, as trustee, would issue a Unit Certificate to itself as holder of 79,010 Ordinary Class units. Kirby Hayne (xix) The directors of Pacinette would then resolve to make a written offer to purchase the land held by the trust in consideration of the redemption of 79,010 Ordinary Class units and authorise the directors to make a written offer to be delivered to The Pacinette Property Trust. (xx) Pacinette would then make and deliver the written offer. (xxi) The directors of Pacinette, as trustee, would resolve to accept the offer and authorise Mr Howell to inform the directors of Pacinette of its acceptance. (xxii) The directors of Pacinette would then note that the offer had been accepted. (xxiii) At some point in the process (a point not identifiable by reference to any proposed resolution of directors) Sealark was to give an irrevocable power of attorney to Pacinette (expressed to be in consideration of $10) to deal with the land in any way it saw fit. The events Documents were prepared to record each of these intended steps in respect of each of the 770 transactions. The documents included minutes of meetings (including those of separate meetings for steps (ii), (iv), (vi), (viii), (ix), (xi), (xiv) and (xvi)), offers to sell land, unit certificates and bills of exchange. They did not include any separate registers of unit holders for the various trusts. (It may be assumed that this failure, of itself, would not necessarily deny the entitlement of unit holders30.) Over all these documents there hovered the sterilising effect of s 29(3) of the Stamp Duties Act if they were "in respect of" a Div 3A transaction. On 11 May 1998, Mr Halloran, Mr Howell, Ms Earleen Kenny (the secretary of Pacinette) and two solicitors for the Halloran interests (Mr Seller, the partner of the firm having carriage of the matter, and Ms Cleary, then an employee solicitor of the firm) met at the offices of that firm of solicitors. Mr Seller explained to the meeting the intended steps and did so by reference to one particular set of documents that has not since been identified beyond the fact that it was not the Pacinette documents. Mr Seller then asked Mr Halloran, Mr Howell and Ms Kenny to agree that "as regards each other transaction and 30 See Simultaneous Colour Printing Syndicate v Foweraker [1901] 1 KB 771. Kirby Hayne transfer of land [other, that is, than the one taken as an example] that they occur in the same order and fashion". He said that "[a]ll the transactions are exactly the same and by going through one transaction we are effectively going through all the transactions and then all that remains is the signing of the completed documents". Mr Halloran, Mr Howell and Ms Kenny all said that they understood this. Subsequently, each of Mr Halloran, Mr Howell and Ms Kenny signed all of the various documents, but each did that separately and the documents were not shown to have been signed in an order that reflected the sequence of steps described above. The Pacinette documents were dated 14 May 1998. It appears that this date was chosen because it was the day on which the last of the necessary signatures was appended to documents relating to the Pacinette transaction. In addition to the various documents that were said to record or to give effect to the intended steps described above, Ms Kenny subsequently made two statutory declarations in respect of each transaction. In one she declared that she had been present at a meeting on 14 May 1998 of directors of Sealark at which she "heard" Mr Halloran and Mr Howell hold a meeting resolving to accept a written offer by The Pacinette Property Trust to sell the land in consideration of the allotment of 79,000 $1 A Class units in the trust; in the other she declared that she had been present at a meeting of directors of Pacinette as trustee of The Pacinette Property Trust at which she "heard" Mr Halloran and Mr Howell hold a meeting resolving to accept a written offer to sell the land in consideration of the redemption of units in The Pacinette Property Trust by Pacinette. Each statutory declaration was made on 22 May 1998. The Minister's contentions First, the Minister contends, as the Court of Appeal held, that Talbot J erred because the evidence and agreed facts do not establish that the steps said to have taken place in May 1998 actually occurred. The submission was developed by saying that, because the elaborate and sequential steps (particularly respecting the drawing, acceptance and negotiation of a bill of exchange) had not been taken, the scheme had not been implemented in accordance with its design; as a result, Pacinette had held at the resumption date no compensable equitable interest. Several points should be made immediately concerning the width of the Minister's first contention. One is that it is not said that the transactions were Kirby Hayne integers in a scheme which was a "sham" in the received sense given in the authorities referred to in Equuscorp Pty Ltd v Glengallan Investments Pty Ltd31. Another is that the Minister accepts that contractual assent may be inferred from conduct, and that, any requisite statutory formalities apart, company directors may act informally and may manifest unanimous consent without the passage of formal resolutions. In that regard, the Minister accepts the authorities collected by Powell JA in MYT Engineering Pty Ltd v Mulcon Pty Ltd32. Furthermore, the mere fact that a number of meetings are held simultaneously does not deprive the resolutions of efficacy. If, for example, three people are the sole shareholders in each of a number of companies, however large that number may be, they could effectively resolve, on a single occasion, in their capacities as the shareholders of all those companies, in a manner binding all those companies; assuming, of course, that the subject-matter of such resolution was otherwise within the power of a general meeting of the shareholders of each company. The Minister's second contention is that if, contrary to the first contention, all the steps in the scheme actually occurred, they were ineffective to vest the equitable interests for which Pacinette claims compensation because there was a fatal want of compliance with statutory formalities. The statutory formalities were those made necessary by s 23C of the Conveyancing Act. Thirdly, if neither of the two above objections succeeds in supporting dismissal of the appeal, the Minister further contended in oral submissions noted above that because stamp duty which was properly exigible was not paid, proof of the transaction relied upon for the first event was denied by s 29(3) of the Stamp Duties Act. For reasons which will be stated after dealing with further matters, it is upon this third ground that the appeal should be dismissed. The significance of what was done in May From what happened at the offices of the solicitors, it may be concluded that the parties expressed assent to the taking of the various intended steps. Those who controlled both Sealark and Pacinette (and the other companies 31 (2004) 218 CLR 471 at 486-487 [46]. 32 (1997) 140 FLR 247 at 266; 15 ACLC 1057 at 1073-1074; 25 ACSR 78 at 92. (An appeal to this Court was allowed, but on grounds not presently material: MYT Engineering Pty Ltd v Mulcon Pty Ltd (1999) 195 CLR 636.) See also the analysis by Dixon CJ, Williams and Kitto JJ of the transaction in War Assets Pty Ltd v Federal Commissioner of Taxation (1954) 91 CLR 53 at 86-91. Kirby Hayne involved), both as controllers of the corporators of those companies and as directors, agreed that the steps be taken. Some of those steps required the execution of documents. Not all of those steps were taken. In particular, the steps constituting the "second event", involving the issue and redemption of units, were to be taken in consideration of dealings with the bill of exchange. Something more should be said respecting the bill. The bill of exchange was drawn by Pacinette and accepted by Sealark as an accommodation party. That is, Sealark signed the bill "without receiving value therefor, and for the purpose of lending his name to some other person" (Bills of Exchange Act 1909 (Cth) ("the Bills of Exchange Act"), s 33(1)). As an accommodation party, Sealark was liable on the bill to a holder for value33 but had a right of indemnity against Pacinette as drawer34. Sealark's acceptance was effective whether or not Sealark accepted the bill before it had been signed by Pacinette as drawer, or while otherwise incomplete35. On its face, the bill ultimately executed by Pacinette as drawer and Sealark as acceptor was valid according to its tenor and gave rise to the liability of Sealark as acceptor prescribed by s 59 of the Bills of Exchange Act and the liability of Pacinette as drawer prescribed by s 60 of that Act, as well as Sealark's right against Pacinette to be indemnified against its liability. The intended dealings with the bill were: first, its use by Pacinette to pay for Ordinary Class units in The Pacinette Property Trust, and then its negotiation by indorsement by Pacinette as trustee to Sealark to satisfy payment to Sealark of the proceeds of redemption of Sealark's A Class units in the trust. As has already been noted, the evidence led at trial, in this respect, as in others36, revealed what was intended to be done with the bill rather than what was done. In particular, there was no direct evidence given that the bill was ever tendered in payment for units37, or that the bill, payable as it was to order, was 34 Coles Myer Finance Ltd v Federal Commissioner of Taxation (1993) 176 CLR 640 35 s 23(1)(a). 36 (2004) 12 BPR 22,391 at 22,409-22,410. 37 Bills of Exchange Act, s 26. Kirby Hayne ever negotiated by indorsement and delivery of the bill38. The evidence about the way in which the documents were signed precludes a finding that there was at any particular point in a series of transactions either a delivery of the bill or a negotiation of the bill by indorsement and delivery. It may fairly be said that this must not be permitted to obscure the facts that: there was a bill of exchange drawn by Pacinette on Sealark, accepted by Sealark, and payable to Pacinette as trustee; and the bill was indorsed by Pacinette as trustee to Sealark. Moreover, as Mason P properly emphasised in ISPT39, equity does not work to defeat the lawful intentions of parties; its preference of substance to form and its regard for what ought to be done as having been done are indications of the contrary inclination. The parties agreed, for the valuable consideration of mutual promises of future performance, that the several intended steps would thereafter be taken. A failure to consummate that agreement in its terms would not necessarily discharge equity from any further concern with the matter where, as in this case, an issue is presented for later curial determination whether one or other or none of the parties subsequently held an equitable interest compensable upon resumption by a public authority. If one or more of the parties had released its equitable rights, or perhaps, for reason of a defence of laches, acquiescence, delay or estoppel, had lost its claim to equitable protection, that would be another matter. But no such case was presented by the Minister. The Court of Appeal allowed the appeal because of its opinion that the purported transactions did not occur. We will assume, without deciding the point, that it was open, on the limited appeal before that Court, for the Court of Appeal to proceed to that conclusion. However, that conclusion did not compel the further conclusion that Pacinette and the other appellants did not hold a compensable equitable interest. 38 Bills of Exchange Act, ss 13(4), 36(3). 39 (1998) 45 NSWLR 639 at 650. Kirby Hayne Nevertheless, that does not mean that the appellants must succeed in this Court. Their appeal fails on another ground. Change in beneficial ownership Was the design for the first event one for a "transaction" which would cause or result in "a change in the beneficial ownership [by Sealark] of an estate or interest in ... land situated in New South Wales", as stated in s 44(1)(a) of the Stamp Duties Act? The term "beneficial ownership" used in s 44(1) is apt to include as the subject-matter of that "ownership" an equitable estate or interest. The interest of Sealark was of this nature. Where an interest to be transferred is, as here, a creature of equity, equity requires a clear expression of intention to make an immediate disposition; that, in the absence of an applicable statutory requirement, suffices40. If the transaction is a contract rather than a conveyance, then consideration is essential to attract the support of equity41. It was essential for the design respecting the first event that there be no written contract for the sale by Sealark to Pacinette as trustee of The Pacinette Property Trust. What might be called stamp duty considerations dictated that absence of a written contract. However, there was to be a written offer, accepted by Sealark and recorded in minutes, and the issue of a certificate for the 79,000 $1 A Class units which was the consideration moving to Sealark. At the time when that consideration was provided to Sealark, if not earlier upon acceptance by Sealark of the written offer42, a change in the relationship between Sealark and Pacinette took place. The equitable interest in the land later to be resumed was now vested in Pacinette as a trustee of The Pacinette Property Trust. In the eye of equity, which provided the critical conspectus because the subject-matter was purely equitable, nothing remained to be done in order to define the respective rights of Sealark and Pacinette with respect to that equitable interest; a court of equity might be asked to protect rights completely defined in 40 See Norman v Federal Commissioner of Taxation (1963) 109 CLR 9 at 30-31. 41 Norman v Federal Commissioner of Taxation (1963) 109 CLR 9 at 31. 42 The authorities considering the extent to which it is accurate to say that a trust may have arisen at that earlier stage were considered in Tanwar Enterprises Pty Ltd v Cauchi (2003) 217 CLR 315 at 330-331 [47], 332-333 [53], 351 [106]. Kirby Hayne this way43. It may be convenient to describe Sealark in these circumstances as in the position of a trustee for Pacinette under a bare trust involving no duties. But there would be much to be said for the view that the intrusion of the notion of a trust at that stage would be superfluous, were it not for s 23C of the Conveyancing Act. On one view of the situation of the parties, the absence of a disposition in writing signed by Sealark to comply with par (c) of s 23C(1) would be met by reliance upon s 23C(2) and a constructive trust binding Sealark, in the events that had happened, in favour of Pacinette. On another view of the matter, any assertion of a lack of efficacy for want of compliance with par (c) of s 23C(1) would be to use the statute as an instrument of fraud44. Whichever form of reasoning be employed, and it is unnecessary for this appeal to choose between them, the result is that in the circumstances postulated there has been a change in the "beneficial ownership" spoken of in s 44(1) of the Stamp Duties Act. However, it no doubt is true that Sealark would hold all the issued A Class units in The Pacinette Property Trust. Would the fact that Sealark was sole unit holder of those units have the consequence, as the appellants submitted, that the "beneficial ownership" of the equitable interest in land had not changed because that interest was still to be found, by reason of the issue of the units, in the hands of Sealark? The answer must be that there had been a change. Consistently with the reasoning in CPT Custodian Pty Ltd v Commissioner of State Revenue45 and with the terms of the Pacinette Trust Deed, to which reference has been made earlier in these reasons, Sealark would not have any interest in any particular part of the Trust Fund or in any investment thereof. It may then be said, as the appellants appeared to submit, that as a result of the first event there would be a "direct passage" of the beneficial ownership to Pacinette and that, disregarding the second event as superfluous, this sufficed to identify a compensable equitable interest in Pacinette at the time of the resumption of the land. 43 Tailby v Official Receiver (1888) 13 App Cas 523 at 547. 44 Theodore v Mistford Pty Ltd (2005) 79 ALJR 1503 at 1508-1509 [30]-[31]; 219 ALR 296 at 303. 45 (2005) 79 ALJR 1724; 221 ALR 196. Kirby Hayne However, that conclusion would in compensation proceedings that the first event had occurred. The first event critically depended upon proof of written materials, short of a written contract of sale, but still essential to the scheme. The appellants set out to prove these matters, including the written offer and acceptance recorded in the minutes, and the issue of the Unit Certificate (steps (vi), (viii) and (x)). Talbot J held that they had done so. But the sterilising operation of s 29(3) of the Stamp Duties Act denied that proof. The conclusion that s 29(3) applied is only made good if the materials were proffered in proof of a transaction to which Div 3A applied. What has been said so far is that the terms of s 44(1) were satisfied. However, regard must be had to s 44(2). In its form at the date of the May 1998 events, this stated: "A reference to a change in beneficial ownership in this section does not include a reference to a change in beneficial ownership occurring as the consequence of: the appointment of a receiver or trustee in bankruptcy, the appointment of a liquidator, the making of a compromise or arrangement under Part VIII of the Companies (New South Wales) Code which has been approved by the court, the issue or redemption of units in a unit trust scheme, the surrender of a lease, the transfer or conveyance of any estate or interest in property as a security, including the pledging or charging of property, or the release or termination of an option for the purchase of property." (emphasis added) In written submissions provided after the conclusion of oral argument, the parties developed their conflicting constructions of s 44(2), particularly of par (d), in its application to the circumstances of the litigation and in light of the reasoning in CPT Custodian Pty Ltd46. 46 (2005) 79 ALJR 1724; 221 ALR 196. Kirby Hayne Section 44(2) fixes upon a list of dispositive events in the law which have the consequence that there occurs a change in beneficial ownership. Such steps as the creation of a security, the surrender of a lease and the appointment of a trustee in bankruptcy may readily be seen as having this character. Cases may be envisaged where the critical event for a change in beneficial ownership is the issue or redemption of units in a unit trust scheme. It is unnecessary to determine whether the redemption of units involved in the second event would answer this description. However, in the present case, the change in the beneficial ownership of the relevant subject-matter, the equitable interest of Sealark, was not brought about as the consequence of the issue of units in a unit trust. The change was brought about, and was the consequence of, the fact that the consideration (no matter what form that consideration took) was provided by Pacinette to Sealark. The change was thus the consequence of the operation of the doctrines of constructive trusts or of the use of statutes as instruments of fraud or both. As with so many questions of causation, it may be possible to say that the result that Pacinette itself held the equitable interest upon the trusts of the Pacinette Trust Deed was the product of many circumstances. And one feature of one of the circumstances, the provision of the consideration by Pacinette to Sealark, was the form of consideration provided: the issue of units in a unit trust scheme. But, within the sense of s 44(2), the result that Pacinette held the equitable interest upon the trusts of the Pacinette Trust Deed was the consequence of the equitable doctrines and principles that have been identified. The result is that s 44(1) of the Stamp Duties Act applied to the first event and that s 29(3) was engaged in the proceedings before Talbot J. The Minister's submission that the appellants have not established by admissible evidence in the compensation proceedings the occurrence of what has been described as the first event should be accepted. That being so, there was no relevant subject-matter upon which the second event might operate and it need not now be further considered. Conclusions The separate question decided affirmatively by Talbot J was framed in terms asking whether Pacinette had "established on the admissible evidence tendered at the hearing of this question" that it is an owner of an interest in the land in question and is entitled to maintain its claim under s 37 of the Compensation Act. That question should have been answered in the negative. Kirby Hayne On the view it took of the facts and of the efficacy of what had been attempted but not achieved, the Court of Appeal went further than returning a negative answer to the separate question. The Court of Appeal ordered that there be a declaration that Pacinette "is not the owner of an interest in the land" and "is not entitled" to maintain its claim under s 37 of the Compensation Act. Talbot J had dismissed the motion in which the Minister had sought to deal with the other class 2 claimants and made no declaration respecting those claimants. The Court of Appeal set aside Talbot J's order and declared that the relevant class 2 claimants "are not entitled to maintain claims under s 37 of the [Compensation Act]". Given the basis in the Stamp Duties Act upon which the appeal is decided in this Court, declaratory relief cast in the absolute terms of that given by the Court of Appeal is inappropriate. The proceedings in the Land and Environment Court are still on foot. Upon resumption of those proceedings, it may be open to the appellants, without foundering upon principles of issue estoppel and related doctrines, to remove the sterilising effect of the revenue legislation by compliance with Div 3A of the Stamp Duties Act and payment of stamp duty and fines to the satisfaction of the Commissioner47. We express no view as to whether that course would be open to the appellants, a matter upon which submissions were not made, but the possibility re-emphasises the need for attention to the precise issue set aside for separate determination by Talbot J48. This in terms fixed upon what was established by the admissible evidence. The order of the Court of Appeal should be varied to reflect that state of affairs. Orders The following orders should be made: 47 cf Shepherd v Felt and Textiles of Australia Ltd (1931) 45 CLR 359 at 382-385; Commercial Banking Co of Sydney Ltd v Love (1975) 133 CLR 459 at 481. 48 See Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 358 [53]; Malika Holdings Pty Ltd v Stretton (2001) 204 CLR 290 at 308-309 [61]; Rural Press Ltd v Australian Competition and Consumer Commission (2003) 216 CLR 53 at 91 Kirby Hayne Order 2 of the Order of the Court of Appeal entered 17 August 2004 should be varied so as to read: "Declare that upon the admissible evidence tendered at the proceeding before Talbot J the applicant, Pacinette Pty Ltd, has not established that it is the owner of an interest in the land the subject of the Notice of Acquisition published in the Government Gazette dated 19 June 1998 and is entitled for the purposes of these proceedings to maintain its claim under s 37 of the Land Acquisition (Just Terms Compensation) Act 1991 in respect of nominated lots 140, 1629 and 1063." Order 3 of that Order should be varied so as to read: "Declare that upon the admissible evidence tendered at the proceeding before Talbot J, the Beneficial Ownership Claimants in Class 2 referred to in the Amended Points of Claim dated 28 December 2000 have not established that they are entitled to maintain claims under s 37 of the Land Acquisition (Just Terms Compensation) Act 1991 in respect of land resumed by Notices of Acquisition published in the Government Gazette on 19 June 1998 and on 18 September 1998." Otherwise, appeal dismissed with costs. HEYDON J. I agree with the orders proposed by Gleeson CJ, Gummow, Kirby The majority reasoning The majority reasoning concentrates on steps (viii)-(x) of the 23 steps involved. It states: that when a certificate for 79,000 $1 A Class units was issued (step (x)), if not earlier, upon acceptance by Sealark of Pacinette's written offer, a change in the relationship between Sealark and Pacinette took place, in particular so far as beneficial ownership of Sealark's equitable interest in the land was concerned; that s 29(3) of the Stamp Duties Act 1920 (NSW) prevents proof of step (x) and the steps antecedent to it, unless s 44(2)(d) applies; that s 44(2)(d) does not apply because the change in the beneficial ownership was not brought about "as the consequence of the issue of units in a unit trust", but was rather brought about as the "consequence of … the fact that the consideration (no matter what form that consideration took) was provided by Pacinette to Sealark"49; that the "change was thus the consequence of the operation of the doctrines of constructive trusts or of the use of statutes as instruments of fraud or both", rather than the consequence of the issue of units in a unit A qualification to the majority reasoning I agree with this reasoning, except in one respect. Step (viii) created a contract to transfer Sealark's equitable interest in the land to Pacinette in return for the issue by Pacinette in favour of Sealark of 79,000 $1 A Class units. At that moment a constructive trust arose and the beneficial ownership of Sealark's equitable interest changed, at least to some extent51. The interest of Pacinette as purchaser was commensurate with its ability 51 Oughtred v Inland Revenue Commissioners [1960] AC 206 at 227-228 per Lord Radcliffe; Neville v Wilson [1997] Ch 144 at 157 per Nourse, Rose and Aldous LJJ; (Footnote continues on next page) to protect that interest by obtaining specific performance52. In the present circumstances there was no impairment of that ability by reason of any termination of the contract by Sealark as vendor. Hence there is no circularity, and no other difficulty53, in viewing Pacinette as having obtained an interest under a constructive trust in such a way as to change the beneficial ownership of Sealark's equitable interest to some extent. It is unnecessary to consider whether the creation of a beneficial interest in Pacinette by way of constructive trust in consequence of step (viii) meant that there was nothing more of Sealark's equitable interest in the land to pass in consequence of steps (ix) and (x), or whether after step (viii) but before steps (ix) and (x) Sealark retained some equitable title which only passed when steps (ix) and (x) took place. To the extent that any change in beneficial ownership took place when steps (ix) and (x) were carried out – the allotment of the 79,000 $1 A Class units and the issue of the certificate relating to them – that was a change that occurred as the consequence of the issue of units in a unit trust scheme within the meaning of s 44(2)(d). However, this does not assist the appellants. A different change in beneficial ownership occurred earlier, at step (viii). That change in beneficial ownership, occurring when the constructive trust arose as the consequence of the promise to issue units in the unit trust scheme, was not a change in beneficial ownership occurring as the consequence of the issue of those units. It was only a change occurring as the consequence of the promise to issue them. Hence, s 44(2)(d) does not apply. Therefore, s 29(3) prevents proof of step (viii). That in turn prevents establishment of Sealark's acceptance of Pacinette's offer to buy Sealark's equitable interest in the land. In consequence it is impossible to prove the passing of that equitable interest, and the scheme thus fails at that point. In written submissions filed after the conclusion of oral argument, the appellants advanced the contention that these conclusions do not follow. That contention was not based on any view that step (viii) did not change the beneficial ownership of Sealark's equitable interest; indeed the appellants accepted that a "change in beneficial interests in, as opposed to an absolute change of beneficial ownership of, Sealark's land could have occurred when Sealark accepted Pacinette's written offer". In a similar vein, the appellants conceded that by reason of step (viii) equity would impose a constructive trust over Sealark's proprietary interest in favour of Pacinette, and this gave Pacinette a proprietary interest in the land. Rather, the appellants' contention that s 29(3) Baloglow v Konstantinidis (2001) 11 BPR 20,721 at 20,750-20,751 [120]-[123] per Priestley JA (Mason P concurring). 52 Stern v McArthur (1988) 165 CLR 489 at 537 per Gaudron J. 53 See Tanwar Enterprises Pty Ltd v Cauchi (2003) 217 CLR 315 at 332-333 [53]. did not prevent proof of step (viii) was based on giving the word "transaction" in s 44(2)(d) a broad meaning. In the present context, on that meaning, the word "transaction" referred to "the whole of the dealings pursuant to the contract formed by Sealark's acceptance of Pacinette's written offer". The "transaction", it was said, comprised not only the contract itself (step (viii)) but the steps taken to carry it into execution (including steps (ix) and (x)). That broad construction of the word "transaction" is unsound. Section 44(2) sets out seven precisely defined events. The respondent submitted that the legislature, in speaking of "a change in beneficial ownership occurring as the consequence of" one of those events, required the event to be an operative cause of the change. The construction underpinning that submission is sound. It requires, in contexts like the present, identification of an event which both falls within the expression "the issue or redemption of units in a unit trust scheme" and is the operative cause of a change in beneficial ownership. On that construction, s 44(2)(d) does not extend to events other than the issue or redemption of units, even if they are part of the dealings pursuant to a contract relating to the change in beneficial ownership. Consequences of the majority reasoning The reasoning of the majority, whether or not qualified in the respect just described, leads to the conclusion that the orders proposed should be made. Any attempt by the appellants to outflank s 29(3) by paying the stamp duty not yet paid would have to overcome several difficulties. One may be the conventional understanding that the trial of a separate question is a process, subject to relevant rules of court, having all the finality of any other trial. Another may be the apparent failure of the appellants to leave open the possibility of payment in the event that their arguments against the application of s 29(3) failed, whether at trial or on appeal, by reserving liberty to reopen their case in that connection. A third is the difficulty in inviting the Land and Environment Court to apply the reasoning of Talbot J favourable to the appellants' case that the purported transactions had in fact occurred in the face of the Court of Appeal's reasoning that they had not – reasoning which the majority in this Court has not determined to be wrong. There may be further difficulties. However, as the majority have said, no submissions were made to this Court about the possibility of the appellants attempting at this late stage to mend their hand by paying the stamp duty, let alone any difficulties attending that attempt, and nothing further need be said about these matters.

HIGH COURT OF AUSTRALIA INDEPENDENT COMMISSION AGAINST CORRUPTION APPLICANT AND MARGARET CUNNEEN & ORS RESPONDENTS Independent Commission Against Corruption v Cunneen [2015] HCA 14 15 April 2015 ORDER Special leave to appeal granted. Appeal treated as instituted and heard instanter and dismissed with costs. On appeal from the Supreme Court of New South Wales Representation J K Kirk SC with S Robertson for the applicant (instructed by Crown Solicitor (NSW)) D F Jackson QC with A R Moses SC and R L Gall for the respondents (instructed by Cockburn and Co) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Independent Commission Against Corruption v Cunneen Statutory bodies – Investigating commission – Independent Commission Against Corruption – Powers – Independent Commission Against Corruption Act 1988 (NSW), s 8(2) defines "corrupt conduct" as conduct that could "adversely affect" exercise of official function by public official – Whether conduct that could adversely affect efficacy, but not probity, of exercise of official function by public official "corrupt conduct". Statutes – Interpretation – Context and purpose – Statutory definitions – Effect of express statement of objects of Act – Where purpose of Act cannot be identified without reference to terms to be interpreted. Statutes – Interpretation – Extrinsic materials – Legislative history – Where legislation not amended after review of Act. Words and phrases – "adversely affect", "and which could involve", "corrupt conduct". Independent Commission Against Corruption Act 1988 (NSW), ss 2A, 8, 9, 12A. FRENCH CJ, HAYNE, KIEFEL AND NETTLE JJ. This is an application for special leave to appeal from a decision of the New South Wales Court of Appeal. The principal question for determination is what is meant by the expression "adversely affects, or that could adversely affect ... the exercise of official functions by any public official" in the definition of "corrupt conduct" in s 8(2) of the Independent Commission Against Corruption Act 1988 (NSW) ("the ICAC Act"). "Adversely affect" is a protean expression. In this context, however, there are only two possibilities. Either it means adversely affect or could adversely affect the probity of the exercise of an official function by a public official, or it means adversely affect or could adversely affect the efficacy of the exercise of an official function by a public official in the sense that the official could exercise the function in a different manner or make a different decision from that which would otherwise be the case. The former meaning accords with the ordinary understanding of corruption in public administration and consequently with the principal objects of the ICAC Act as set out in s 2A. The latter would result in the inclusion in "corrupt conduct" of a broad array of criminal offences and other unlawful conduct having nothing to do with the ordinary understanding of corruption in public administration or the principal objects of the ICAC Act. It would also enable the Independent Commission Against Corruption ("ICAC") to exercise its extraordinary coercive powers (with consequent abrogation of fundamental rights and privileges) in areas ranging well beyond the ordinary understanding of corruption in public administration and the principal objects of the ICAC Act. For those reasons, and the reasons which follow, the former meaning is to be preferred. The history of the ICAC Act The Independent Commission Against Corruption Bill 1988 was introduced into the New South Wales Parliament on 26 May 1988. In the course of the second reading speech, the then Premier of New South Wales, Mr Greiner, observed1: "The third fundamental point I want to make is that the independent commission will not be a crime commission. Its charter is not to 1 New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 26 May 1988 at 674-675. Hayne Nettle investigate crime generally. The commission has a very specific purpose which is to prevent corruption and enhance integrity in the public sector. That is made clear in this legislation, and it was made clear in the statements I made prior to the election. It is nonsense, therefore, for anyone to suggest that the establishment of the independent commission will in some way derogate from the law enforcement role of the police or bodies such as the National Crime Authority. On the contrary, the legislation makes it clear that the focus of the commission is public corruption and that the commission is to co-operate with law enforcement agencies in pursuing corruption. My fourth point is that the independent commission is not a purely investigatory body. The commission also has a clear charter to play a constructive role in developing sound management practices and making public officials more aware of what it means to hold an office of public trust and more aware of the detrimental effects of corrupt practices. ... The final point I want to make by way of introduction concerns the question of civil liberties. This commission will have very formidable powers. It will effectively have the coercive powers of a Royal commission. ... There will be those who will say that this legislation is unjustified interference with the rights of individuals who may be the subject of allegations. Let me make a number of points in response to that sort of claim. First, though the commission will be able to investigate corrupt conduct of private individuals which affects public administration, the focus is public administration and corruption connected with public administration. The coercive powers of the commission will be concentrated on the public sector. Second, corruption is by its nature secretive and difficult to elicit. It is a crime of the powerful. It is consensual crime, with no obvious victim willing to complain." As a consequence of parliamentary debate, a number of amendments were agreed to and incorporated into the Independent Commission Against Corruption Hayne Nettle Bill (No 2) 1988 and that Bill was read a second time on 3 June 19882. The Bill, as amended, was enacted as the ICAC Act. As enacted, ss 8 and 9 of the ICAC Act defined "corrupt conduct" as follows: "8. General nature of corrupt conduct Corrupt conduct is— any conduct of any person (whether or not a public official) that adversely affects, or that could adversely affect, either directly or indirectly, the honest or impartial exercise of official functions by any public official, any group or body of public officials or any public authority; or any conduct of a public official that constitutes or involves the dishonest or partial exercise of any of his or her official functions; or any conduct of a public official or former public official that constitutes or involves a breach of public trust; or any conduct of a public official or former public official that involves the misuse of information or material that he or she has acquired in the course of his or her official functions, whether or not for his or her benefit or for the benefit of any other person. Corrupt conduct is also any conduct of any person (whether or not a public official) that adversely affects, or that could adversely affect, either directly or indirectly, the exercise of official functions by any public official, any group or body of public officials or any public authority and which involves any of the following matters: 2 New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 3 June 1988 at 1548. Hayne Nettle official misconduct (including breach of trust, fraud in office, nonfeasance, misfeasance, malfeasance, oppression, extortion or imposition); bribery; blackmail; obtaining or offering secret commissions; fraud; theft; perverting the course of justice; embezzlement; election bribery; election funding offences; election fraud; treating; tax evasion; revenue evasion; currency violations; illegal drug dealings; illegal gambling; obtaining financial benefit by vice engaged in by others; bankruptcy and company violations; harbouring criminals; forgery; Hayne Nettle treason or other offences against the Sovereign; homicide or violence; (x) matters of the same or a similar nature to any listed above; any conspiracy or attempt in relation to any of the above. Conduct may amount to corrupt conduct under this section even though it occurred before the commencement of this subsection, and it does not matter that some or all of the effects or other ingredients necessary to establish such corrupt conduct occurred before that commencement and that any person or persons involved are no longer public officials. Conduct committed by or in relation to a person who was not or is not a public official may amount to corrupt conduct under this section with respect to the exercise of his or her official functions after becoming a public official. Conduct may amount to corrupt conduct under this section even though it occurred outside the State or outside Australia, and matters listed in subsection (2) refer to— (a) matters arising in the State or matters arising under the law of the State; or (b) matters arising outside the State or outside Australia the arising under or matters Commonwealth or under any other law. law of the The specific mention of a kind of conduct in a provision of this section shall not be regarded as limiting the scope of any other provision of this section. Limitation on nature of corrupt conduct (1) Despite section 8, conduct does not amount to corrupt conduct unless it could constitute or involve— a criminal offence; or Hayne Nettle a disciplinary offence; or reasonable grounds for dismissing, dispensing with the services of or otherwise terminating the services of a public official. Thus, as enacted, s 8(2) had two limbs: the "that could adversely affect" limb and the "and which involves" limb, and s 9 imposed a third criterion, that the conduct involve a crime or breach of a relevant standard of conduct. By Divs 2, 3 and 4 of Pt 4 of the ICAC Act, ICAC was vested with extraordinary powers, inter alia, to conduct investigations on its own initiative or on a complaint being made to it3; to compel the production of information and documents4 regardless of privilege or duty of secrecy5; to enter public premises6; to require any person to provide information regardless of the privilege against self-incrimination7; to conduct compulsory examinations and public inquiries8; to summon witnesses and take evidence9; and to issue and execute search warrants10. Some two years later, following the decision of this Court in Balog v Independent Commission Against Corruption11, the ICAC Act was amended by the Independent Commission Against Corruption (Amendment) Act 1990 (NSW) to give ICAC a clear and wide power to make and report findings and opinions ICAC Act, s 20(1). ICAC Act, ss 21-22. ICAC Act, s 24. ICAC Act, s 23. ICAC Act, ss 26, 37. ICAC Act, ss 30, 37. ICAC Act, s 35. 10 ICAC Act, Pt 4, Div 4. 11 (1990) 169 CLR 625; [1990] HCA 28. Hayne Nettle based on results of its investigations and to make recommendations for the taking of further action12. The 1990 Act also amended s 8(2) by omitting the words "which involves" and inserting in their place "which could involve"13 so that s 8(2) now reads: "Corrupt conduct is also any conduct of any person (whether or not a public official) that adversely affects, or that could adversely affect, either directly or indirectly, the exercise of official functions by any public official, any group or body of public officials or any public authority and which could involve any of the following matters ..." Section 9(1)(d) was inserted in 199414. Section 9(1) now reads: "Despite section 8, conduct does not amount to corrupt conduct unless it could constitute or involve: a criminal offence, or a disciplinary offence, or reasonable grounds for dismissing, dispensing with the services of or otherwise terminating the services of a public official, or in the case of conduct of a Minister of the Crown or a member of a House of Parliament—a substantial breach of an applicable code of conduct." Some ten years after that, on 11 November 2004, Mr Bruce McClintock SC was commissioned by letters patent to take over and conclude an inquiry into whether the terms of the ICAC Act remained appropriate for securing its objectives. 12 Independent Commission Against Corruption (Amendment) Act 1990, Sched 1, item 7. 13 Independent Commission Against Corruption (Amendment) Act 1990, Sched 1, item 6. 14 Independent Commission Against Corruption (Amendment) Act 1994 (NSW), s 3(a). Hayne Nettle In his final report, which was presented in January 2005, Mr McClintock stated15: "ICAC was established to promote the integrity and accountability of public administration by investigating, exposing and preventing serious corruption and educating the public about the detrimental effects of corruption. I am satisfied that the terms of the Act remain generally appropriate for securing its objectives. Some amendments to the Act are required, however, particularly to improve the accountability of ICAC and to make sure its role is properly understood." Two of the amendments proposed by Mr McClintock are relevant for present purposes. The first was to include an express statement of the objectives of the Act in order to eliminate what was perceived to be residual confusion as to the role of ICAC. That recommendation was accepted. Sections 2A and 12A of the ICAC Act were enacted as follows16: "2A Principal objects of Act The principal objects of this Act are: to promote the integrity and accountability of public administration by constituting an Independent Commission Against Corruption as an independent and accountable body: to investigate, expose and prevent corruption involving or affecting public authorities and public officials, and to educate public authorities, public officials and members of the public about corruption and effects on public administration and on the community, and its detrimental 15 McClintock, Independent Review of the Independent Commission Against Corruption Act 1988: Final Report, (2005) at ix. Independent Commission Against Corruption Amendment Act 2005 (NSW), Sched 1 [1], [7]. Hayne Nettle to confer on the Commission special powers to inquire into allegations of corruption. 12A Serious and systemic corrupt conduct In exercising its functions, the Commission is, as far as practicable, to direct its attention to serious and systemic corrupt conduct and is to take into account the responsibility and role other public authorities and public officials have in the prevention of corrupt conduct." In the second reading speech relating to those amendments, the Minister, Mr Sartor, stated that17: "The main changes introduced by the bill are as follows. The bill inserts a new section 2A into the Act to specify the objectives of the Act. These objectives confirm the role of the ICAC as an independent and accountable body established investigate, expose, and prevent corruption involving or affecting public administration. The bill inserts a new section 12A into the Act to require the ICAC, so far as practicable, to direct its attention to serious and systemic corruption. Under part 5 of the Act, other matters may be referred by the ICAC to any person or body considered by the ICAC to be appropriate in the circumstances." The second recommendation of relevance was to redraft s 8 "to more clearly distinguish between corruption by public officials and corruption that adversely affects the performance of public official functions, without involving official wrongdoing"18. In making that recommendation, Mr McClintock set forth his understanding of the effect of s 8(2) as follows19: 17 New South Wales, Legislative Assembly, Parliamentary Debates (Hansard), 23 February 2005 at 14133. 18 McClintock, Independent Review of the Independent Commission Against Corruption Act 1988: Final Report, (2005) at 53, recommendation R4.1. 19 McClintock, Independent Review of the Independent Commission Against Corruption Act 1988: Final Report, (2005) at 53 [4.3.3]. Hayne Nettle from "Section 8(2) corrupt conduct can be distinguished section 8(1) conduct as it requires no wrongdoing on behalf of the public official. The conduct is corrupt because of its potential to adversely affect official functions, not because of any wrongdoing by the official." As will be seen, that was not an accurate assessment of the effect of s 8(2) and, in any event, the recommendation was not adopted. Previous authority concerning the meaning of s 8(2) Until now, s 8(2) has received little judicial attention. There was some reference to it in the judgments of the New South Wales Court of Appeal in Greiner v Independent Commission Against Corruption20, but there was no need to consider what kind of effect would be required to qualify as an adverse effect within the meaning of s 8(2). In Independent Commission Against Corruption v Chaffey, Gleeson CJ began his judgment with this observation21: "Under the Independent Commission Against Corruption Act 1988 one of the principal functions of the Commission is to investigate allegations or complaints of corrupt conduct. The expression 'corrupt conduct' is widely defined. It includes conduct that may not be unlawful, and, in so far as it covers unlawful conduct, it includes criminal offences (such as homicide, illegal drug dealing, theft and many others) which are a part of the ordinary calendar of crime. Although the Act is aimed at official corruption, to be guilty of corrupt conduct a person need not be a public official, provided the conduct in question could adversely affect, directly or indirectly, the exercise of official functions by a public official." Once again it was unnecessary to consider what kind of effect would be required to constitute an adverse effect for the purposes of s 8(2). 20 (1992) 28 NSWLR 125. 21 (1993) 30 NSWLR 21 at 23. Hayne Nettle In Balog, this Court stated that22: "'Corrupt conduct' is defined in ss 7, 8 and 9 and extends generally to any conduct of any person that adversely affects or could adversely affect the honest or impartial exercise of official functions or which constitutes or involves the dishonest or partial exercise of official functions or a breach of public trust. It also includes conduct that adversely affects or could adversely affect the exercise of official functions and involves any one of a number of specified criminal offences, including bribery, blackmail, perverting the course of justice and the like. Nevertheless, conduct does not amount to corrupt conduct unless it could constitute or involve a criminal offence, a disciplinary offence or reasonable grounds for dismissing or dispensing with the services of a public official or otherwise terminating those services." Again, there was no question in that case as to what is meant by "adversely affect" in s 8(2). Significantly, however, in each of those three cases it was either assumed or concluded that the relative clause "and which could involve" limits and defines the "conduct" as opposed to "the exercise of official functions". Later in these reasons, it will be necessary to mention a possible alternative construction whereby the "and which could involve" clause would be taken to limit and control the exercise of the official function as opposed to the conduct. At this point, it is convenient to assume that the approach adopted in the three cases was correct. The proceedings below The first respondent to this application ("Ms Cunneen") is a Deputy Senior Crown Prosecutor of the State of New South Wales. Late last year, ICAC (the applicant) served a summons on her to appear before it to give evidence at a public inquiry to be conducted for the purposes of investigating an allegation or complaint23: 22 (1990) 169 CLR 625 at 628 per Mason CJ, Deane, Dawson, Toohey and 23 Stephen Wyllie and Sophia Tilley are the second and third respondents, respectively. Hayne Nettle "That on 31 May 2014 Deputy Senior Crown Prosecutor, Margaret Cunneen SC and Stephen Wyllie, with the intention to pervert the course of justice, counselled Sophia Tilley to pretend to have chest pains, and that Sophia Tilley, with the intention to pervert the course of justice, did pretend to have chest pains, to prevent investigating police officers from obtaining evidence of Ms Tilley's blood alcohol level at the scene of a motor vehicle accident." It should be appreciated that Ms Cunneen's alleged conduct was not being investigated for the effect it might have on her official functions as a Crown Prosecutor in the sense that, as a public official, she might exercise her official functions in a different manner or make a different decision from that which would otherwise be the case. Following service of the summons, Ms Cunneen instituted proceedings in the Common Law Division of the Supreme Court of New South Wales for, inter alia, a declaration that the alleged conduct was not corrupt conduct within the meaning of s 8 of the ICAC Act and, therefore, that ICAC was acting beyond power in issuing the summons. At first instance, Hoeben CJ at CL held that the alleged conduct was corrupt conduct within the meaning of s 8 and so dismissed the application. On appeal to the Court of Appeal, the majority (Basten and Ward JJA) held that the alleged conduct was not corrupt conduct within the meaning of s 8 and therefore allowed the appeal. The judgments in the Court of Appeal Bathurst CJ, in dissent, reasoned in substance by the following steps: Section 8(6) expressly provides that mention of a kind of conduct in one provision of the section does not limit the scope of any other provision of the section24. (2) Unlike s 8(1), the first limb of s 8(2) does not expressly refer to any form of misconduct or potential misconduct by a public official. The 24 Cunneen v Independent Commission Against Corruption [2014] NSWCA 421 Hayne Nettle misconduct, or potential misconduct, is picked up in the second limb of (3) Although the width of s 8(2) is such that, in many cases, conduct could fall within both s 8(1) and s 8(2), that is not a reason to read down s 8(2). It would be contrary to s 8(6) to do so26. It does not appear to be outside the contemplation of the legislature that both s 8(1) and s 8(2) could be satisfied by the same set of facts27. The critical question is what is meant by the expression "adversely affect, either directly or indirectly, the exercise of official functions"28. If conduct limits or prevents the proper performance of a public official's function, the first limb of s 8(2) will be satisfied29. In this case, the alleged conduct had the potential effect of diverting the investigating police officers from the performance of an investigation into a suspected crime. That is sufficient to satisfy the first limb of s 8(2), assuming the second limb of s 8(2) is made out30. The second limb of s 8(2) would be made out where the alleged conduct had the tendency to deflect the police from invoking the jurisdiction of the court, when it was their duty to do so. That could amount to perverting 25 Cunneen [2014] NSWCA 421 at [16]. 26 Cunneen [2014] NSWCA 421 at [17]. 27 Cunneen [2014] NSWCA 421 at [18]. 28 Cunneen [2014] NSWCA 421 at [19]. 29 Cunneen [2014] NSWCA 421 at [22]. 30 Cunneen [2014] NSWCA 421 at [22]. 31 Cunneen [2014] NSWCA 421 at [23]. Hayne Nettle The alleged conduct had the tendency to frustrate or deflect the course of curial proceedings, thereby adversely affecting, at least indirectly, the exercise by a court of its official functions32. In contrast, Basten JA held that it was evident from the principal object of the ICAC Act, as set out in s 2A and as emerges from the two-limbed structure of s 8(2), that the Act is not concerned with "all unlawful conduct which could adversely affect public administration"33. In his Honour's view, it is necessary to read the expression "adversely affect" in s 8(2) as limited to "conduct which has the capacity to compromise the integrity of public administration"34. Ward JA reasoned to similar effect, although not identically, that conduct may not be regarded as having the capacity to "adversely affect" the exercise by a public official of his or her official functions within the meaning of s 8(2), even if it "could have a potential effect on the exercise of official functions in the sense that it might cause a different decision to be made or the functions to be exercised in a different manner"35, unless the conduct has "the potential to cause ... 'corruption' in the exercise by the public official of his or her functions" or could "have [an] adverse outcome when viewed from a public corruption perspective"36. Her Honour was not persuaded that the alleged conduct satisfied that description37. Basten and Ward JJA both accepted that the alleged conduct had the capacity to affect detrimentally the exercise by the investigating police officers of their investigative powers, in the sense that the police officers might make a different decision or exercise their functions in a different manner38. But their Honours considered that it did not have the capacity to lead the officers or any 32 Cunneen [2014] NSWCA 421 at [24]-[25]. 33 Cunneen [2014] NSWCA 421 at [67]. 34 Cunneen [2014] NSWCA 421 at [71]. 35 Cunneen [2014] NSWCA 421 at [189]. 36 Cunneen [2014] NSWCA 421 at [189]. 37 Cunneen [2014] NSWCA 421 at [193]. 38 Cunneen [2014] NSWCA 421 at [90] per Basten JA, [195] per Ward JA. Hayne Nettle other public official into dishonest, partial or otherwise corrupt conduct39. Consequently, it was not corrupt conduct within the meaning of s 8(2). Difficulties with the approaches taken in the Court of Appeal and by the parties As was said in Project Blue Sky Inc v Australian Broadcasting Authority40: "The primary object of statutory construction is to construe the relevant provision so that it is consistent with the language and purpose of all the provisions of the statute. The meaning of the provision must be determined 'by reference to the language of the instrument viewed as a whole'. ... A legislative instrument must be construed on the prima facie basis that its provisions are intended to give effect to harmonious goals. Where conflict appears to arise from the language of particular provisions, the conflict must be alleviated, so far as possible, by adjusting the meaning of the competing provisions to achieve that result which will best give effect to the purpose and language of those provisions while maintaining the unity of all the statutory provisions." (emphasis added, footnotes omitted) Judged by reference to those imperatives, there are potential difficulties with each of the approaches adopted in the Court of Appeal. The difficulty with the approach taken by Bathurst CJ, which ICAC urged this Court to approve, is that it assumes that the plain and ordinary meaning of "adversely affect" is its broadest possible meaning and does not attempt any kind of reconciliation of the meaning of that expression with the statutory context in which it appears. Conversely, the approach adopted by the majority, which counsel for the respondents urged this Court to adopt, is susceptible to circularity. Counsel for 39 Cunneen [2014] NSWCA 421 at [92] per Basten JA, [193] per Ward JA. 40 (1998) 194 CLR 355 at 381-382 [69]-[70] per McHugh, Gummow, Kirby and Hayne JJ; [1998] HCA 28, recently applied in Certain Lloyd's Underwriters v Cross (2012) 248 CLR 378 at 389 [24] per French CJ and Hayne J; [2012] HCA 56 and in Plaintiff S4/2014 v Minister for Immigration and Border Protection (2014) 88 ALJR 847 at 855 [42] per French CJ, Hayne, Crennan, Kiefel and Keane JJ; 312 ALR 537 at 546; [2014] HCA 34. Hayne Nettle ICAC characterised it as circularity of the kind identified in Shin Kobe Maru41; which is to say the circularity which arises when the terms of a definition are interpreted by reference to the term defined. It would be more accurate to say, however, that if there is any circularity in the majority's reasoning, it is constituted of assuming the purpose of the Act and then reasoning, as if syllogistically, that, because a meaning of "adversely affect" limited to an adverse effect on probity is more consonant with the assumed purpose of the Act, that meaning should be preferred. More specifically, Basten JA referred to the concern of the ICAC Act being with "conduct which has the capacity to compromise the integrity of public administration"42 – the assumption being that the compromise of public administration in that sense is limited to adverse effects upon the probity of public administration – and thus concluded that "adversely affect" in s 8(2) should be taken as limited to adversely affects the probity of the exercise of official functions by public officials. Similarly, Ward JA took as a starting point that the "focus of the ICAC Act is on corruption in the public sector"43. Her Honour stated that the ICAC Act is directed to dealing with adverse effects on the exercise of official functions by public officials from a "public corruption perspective"44 – the assumption being that the "public corruption perspective" is limited to adverse effects upon the probity of public administration – and thus concluded that "adversely affect" in s 8(2) should be taken as limited to adverse effects upon the probity of the exercise of official functions by public officials. In a case like this, however, it is not logically open to apply that kind of syllogistic reasoning. It is impossible to identify the purpose of the ICAC Act (and, therefore, impossible to establish a major premise against which to compare the relative consistencies of the competing constructions of ss 8 and 9) without reference to the scope of operation of the Act as defined by ss 8 and 9. For the same reason, it is not open to express a conclusion as to the meaning of "adversely affect" in s 8(2) in terms of absolute validity. The best that can be done is to reason in terms of relative consistency – internal logical consistency 41 Owners of "Shin Kobe Maru" v Empire Shipping Co Inc (1994) 181 CLR 404 at 419 per Mason CJ, Brennan, Deane, Dawson, Toohey, Gaudron and McHugh JJ; [1994] HCA 54. 42 Cunneen [2014] NSWCA 421 at [71]. 43 Cunneen [2014] NSWCA 421 at [187]. 44 Cunneen [2014] NSWCA 421 at [189]. Hayne Nettle and overall consistency the principles of statutory interpretation adumbrated in Project Blue Sky – to determine which of the two competing constructions of "adversely affect" is more harmonious overall. in accordance with The meaning of "adversely affect" The question remains whether s 8(2) should be seen as limited to "corruption in public administration" in the sense of something which has or could have an effect upon the probity of public administration, or whether it comprehends something more. Counsel for ICAC contended that "corruption" is a term of such variable content as to be capable of including even mere alteration or marring; and that, in this context, there is no reason to suppose a statutory intention that it be any more limited than that. For the reasons which follow, that submission must be rejected. As Basten JA observed, the ordinary meaning of corruption in public administration implies dishonest or partial exercise of an official function45. But to read "adversely affect" in s 8(2) as limited to causing a public official to act dishonestly or partially in the exercise of an official function would be to read s 8(2) as adding nothing to s 8(1); and it would not be right to read s 8(2) in a way that gave it no work to do beyond that already done by s 8(1)(a). Equally, however, it would not be right to read the four paragraphs of s 8(1) and the provision made by s 8(2) as if they were mutually exclusive. Rather, s 8(1) and (2) must be read recognising that s 8 describes "corrupt conduct" as not only misconduct by public officials but also misconduct (by any person) that does or could affect what public officials do. The provisions must further be read recognising that conduct of a public official that falls within s 8(1)(b) may also be conduct of a kind described in s 8(1)(c) or s 8(1)(d) and that the conduct of a public official may, but need not, be accompanied or preceded by conduct of another person (whether or not a public official) that falls within either or both of s 8(1)(a) and s 8(2). And the provisions must be read recognising that conduct of a person (whether or not a public official) that falls within s 8(1)(a) or s 8(2), or both, may, but need not, be accompanied or followed by conduct of a public official that falls within any of s 8(1)(b)-(d), or within either or both of s 8(1)(a) and s 8(2). 45 Cunneen [2014] NSWCA 421 at [62]. Hayne Nettle Hence, when it is said that s 8(2) must be given work to do beyond the work done by s 8(1) (and s 8(1)(a) in particular) the concern is to identify additional work done by the provision, not some wholly distinct and separate field of operation. At the same time, it is necessary to keep in mind that s 8(1) demonstrates that "corrupt conduct" is not confined to conduct of any person (whether or not a public official) that does, or could, adversely affect the honest and impartial exercise of official functions (s 8(1)(a)) or conduct of a public official that constitutes or involves the dishonest or partial exercise of official functions (s 8(1)(b)). "Corrupt conduct" includes conduct by a public official of a kind described in either or both of s 8(1)(c) and (d). All of that combines to inform the natural and ordinary meaning of "adversely affect" in s 8(2). In that context, the expression appears to have the sense of having an injurious effect upon or otherwise detracting from the exercise of an official function by causing it to fall short of or below a set or given standard46. Standing alone in s 8(2), that could mean either to adversely affect something about the manner in which the official function is exercised or to adversely affect the results of the exercise of the official function; or possibly both. Viewed in the context of s 8(1)(b)-(d), however, and the interrelationship between ss 8(1)(b)-(d) and 8(2), it will be seen that what was intended is an adverse effect upon the exercise of an official function by a public official such that the exercise constitutes or involves conduct of the kind identified in s 8(1)(b)-(d). As Basten JA appreciated, the key to the interrelationship between ss 8(1)(b)-(d) and 8(2) is what it is that was sought to be achieved by the omission of "honest or impartial" from s 8(2)47. Logically, it appears to have been designed to expand the scope of s 8(1) in two respects: by extending the reach of ss 8(1)(c) and 8(1)(d) from public officials (and former public officials) to persons who are not public officials; and by including in the definition of "corrupt conduct" conduct which could adversely affect the exercise of official functions by any public official in either of the respects identified in ss 8(1)(c) and 8(1)(d). Accordingly, the effect of s 8(1) and (2) is to mark out two distinct kinds of conduct as corrupt conduct, as follows: 46 The Oxford English Dictionary, 2nd ed (1989), vol 1 at 189, "adverse", sense 2. 47 Cunneen [2014] NSWCA 421 at [54]. Hayne Nettle conduct of a public official that: constitutes or involves the dishonest or partial exercise of an official power (s 8(1)(b)); or constitutes or involves a breach of public trust (s 8(1)(c)); or (iii) involves the misuse of information or material acquired in the course of the public official's official functions (s 8(1)(d)); and conduct of any person, whether a public official or not, which could "adversely affect" the exercise of official functions by any public official in one of the following ways: if the conduct could "adversely affect" the honest or impartial exercise of the official function (s 8(1)(a)); or if the conduct could otherwise "adversely affect" the exercise of the official function and the conduct could involve one of the matters mentioned in s 8(2)(a)-(y). The symmetry of that structure implies that the expression "adversely affect" in s 8(2) means to adversely affect the exercise of an official function by a public official in such a way that the exercise constitutes or involves conduct of the kind identified in s 8(1)(b)-(d). More precisely, pars (b)-(d) of s 8(1) limit the range of "corrupt conduct" which may be committed by a public official in the exercise of an official power to the three kinds of misconduct delineated in pars (b)-(d). Those three categories of misconduct thereby define the nature of improbity of public officials in the exercise of official functions which the ICAC Act conceives to be anathema to integrity in public administration. Section 8(2) is directed at conduct which adversely affects the exercise of an official function by a public official. Given that pars (b)-(d) of s 8(1) define the extent of improbity of public officials at which the ICAC Act is directed, it is inherently improbable that s 8(2) is directed at any broader range of improbity in the exercise of official functions than is covered by s 8(1)(b)-(d). It is more logical and textually symmetrical to read "adversely affect" in s 8(2) as confined to having an injurious effect upon or otherwise detracting from the probity of the exercise of the official function in any of the senses defined by s 8(1)(b)-(d). That construction is also more consonant with the language of ss 2A and 9 in that it embraces offences which could affect the integrity of public administration and excludes those which could not. Hayne Nettle Of course, it may be queried why, if s 8(2) is aimed only at conduct which could cause a public official to act in the exercise of an official function in a manner which could involve one or other of the forms of misconduct described in s 8(1)(b)-(d), s 8(2) does not simply provide that conduct is also corrupt conduct if it could adversely affect the exercise of an official function by a public official in that manner. What is the purpose of the added requirement that the conduct could involve one or other of the kinds of offences listed in s 8(2)(a)-(y)? A possible explanation, which would weigh against construing "adversely affect" as limited to having an injurious effect upon or otherwise detracting from the probity of the exercise of the official function in any of the senses defined by s 8(1)(b)-(d), is that Parliament conceived of the heinousness of the offences listed in s 8(2)(a)-(y) as sufficient in itself to regard any offence of that kind as "corrupt conduct" so long as it had or could have an adverse effect howsoever on the efficaciousness of an exercise of an official function by a public official. Given, however, the diverse range of offences listed in s 8(2)(a)-(y), and that, relatively speaking, some might not be particularly serious, that is an unlikely explanation. Each of the matters listed in pars (a)-(y) is capable of being either in itself a diversion from proper administration (as would be the case where the conduct constitutes official misconduct or any of the forms of election misconduct identified) or conduct of a kind that, depending upon the circumstances, could be calculated to have an adverse effect on the probity of the exercise of official functions by public officials in one or more of the ways described in s 8(1)(b)- (d). The matters specified in s 8(2)(a)-(y) are, therefore, matters of a kind that direct particular attention to whether the conduct in question did or could adversely affect the exercise of official functions by a public official engaging in conduct of a kind described in any of s 8(1)(b)-(d). Hence the competing, and more compelling, construction of s 8(2) is that, if the conduct in question "could involve" any of the matters in pars (a)-(y) and if the conduct adversely affects or could adversely affect the probity of the exercise of an official function in one of the ways listed in s 8(1)(b)-(d), the conduct is "corrupt conduct". Both of these conditions must be met in order to satisfy s 8(2). It is not enough to show only that there was conduct by a person (whether or not a public official) that could involve one or more of the matters listed in pars (a)-(y). It is necessary to show also that the conduct did or could adversely affect the exercise of an official function in one of the ways listed in s 8(1)(b)-(d). That view of s 8(2) is also rendered more likely by the realisation that, if "adversely affect ... the exercise of official functions" meant adversely affect Hayne Nettle howsoever the efficaciousness of the exercise of the official function, as opposed to adversely affect the probity of the exercise of the function, it would result in the inclusion in the definition of "corrupt conduct" of a wide variety of offences having nothing to do with corruption in public administration as that concept is commonly understood. Thus, for example: In any case where a public authority relied on the advice, say, of a fraudulent stockbroker, insurance company or savings institution (just as other institutions and members of the public might do), and was thereby caused to suffer financial loss, the broker, insurance company or savings institution's fraud would count as corrupt conduct under s 8(2)(e) because the authority's financial loss could leave it less able to discharge its official functions. If a thief stole one of a public authority's vehicles – say a garbage truck – the theft would qualify as corrupt conduct under s 8(2)(f) because, having lost the use of the truck, the authority could be rendered less able to discharge its official function of collecting garbage. (3) Any offence of telling lies to a police officer with the object of deflecting the officer from instituting a prosecution would count as corrupt conduct under s 8(2)(g). If the employee of a government contractor – say a computer software contractor – embezzled funds from the contractor, the embezzlement would qualify as corrupt conduct under s 8(2)(h) because the contractor's loss could deplete the contractor's ability to perform the contract and in turn that could lead to a government official being less well equipped with the computer software necessary to perform his or her official functions. (5) Any form of state tax or revenue evasion would qualify as corrupt conduct under s 8(2)(m) because the evasion of tax could deprive state tax officers of the ability to collect the tax evaded and deprive other departments of revenue with which to carry out their functions. Currency violations would count as corrupt conduct under s 8(2)(o) just because they could result in public officials being less able to control the flow of currency. Bankruptcy and company offences would be corrupt conduct under s 8(2)(s) because they could lead to a reduced return in insolvency to a public authority and thereby lessen the authority's capacity to perform its official functions. Hayne Nettle (8) Any offence of harbouring a criminal would count as corrupt conduct under s 8(2)(t) because it could have a negative effect on the exercise by police officers of their official function of detecting and arresting criminal offenders. (9) Any unlawful killing of a public official or other violent offence committed against a public official (even if wholly unrelated to the official's status or duties) would count as corrupt conduct under s 8(2)(w) because the killing or violence could terminate or inhibit the official's exercise of official functions. Even an act of domestic violence, if committed against a victim employed as a public official, would be corrupt conduct. (10) All forms of treason would be corrupt conduct under s 8(2)(v) because they could compromise the exercise of official functions by public officials. It is not likely that an Act which is avowedly directed to investigating, exposing and preventing corruption affecting public authorities – and for which the justification for the conferral of extraordinary powers on ICAC was said to be the difficulty of discovering and exposing corruption in the nature of a consensual crime of which there is no obvious victim willing to complain – should have the purpose or effect of extending the reach of ICAC to a broad array of crimes having nothing to do with corruption in public administration apart from such direct or indirect effect as they might conceivably have upon the efficaciousness of the honest and impartial exercise of official functions by public officials. The principle of legality48, coupled with the lack of a clearly expressed legislative intention to override basic rights and freedoms on such a sweeping scale as ICAC's construction would entail, points strongly against an intention that ICAC's coercive powers should apply to such a wide range of kinds and severity of conduct. So does the impracticality of a body with such a wide jurisdiction effectively discharging its functions. It would be at odds with the objects of the Act reflected in s 2A. It would be inconsistent with the assurances in the extrinsic materials earlier referred to that ICAC was not intended to 48 See, eg, Attorney-General (SA) v Adelaide City Corporation (2013) 249 CLR 1 at 30-31 [42] per French CJ; [2013] HCA 3; Lee v New South Wales Crime Commission (2013) 251 CLR 196 at 217-218 [29] per French CJ, 264-265 [171]- [173] per Kiefel J, 307-311 [307]-[314] per Gageler and Keane JJ; [2013] HCA 39. Hayne Nettle function as a general crime commission. And, last but by no means least, as Basten JA observed, an extended meaning of "corrupt conduct" would be far removed from the ordinary conception of corruption in public administration49. Logically it is more likely and textually it is more consonant with accepted canons of statutory construction that the object of s 8(2) was to extend the reach of ICAC's jurisdiction no further than to offences of the kind listed in s 8(2)(a)- (y) which could adversely affect the probity of the exercise of official functions by public officials in one of the ways described in s 8(1)(b)-(d). Counsel for ICAC criticised that conclusion as in effect rejecting the plain and ordinary meaning of "adversely affect" in favour of an inference impermissibly drawn from the statement of the objects of the ICAC Act in s 2A. The criticism is misplaced. As was earlier observed, "adversely affect" is a protean expression capable of a number of meanings according to the context in which it appears. The technique of statutory construction is to choose from among the range of possible meanings the meaning which Parliament should be taken to have intended. Contrary to counsel's submission, there was and is nothing impermissible about looking to the context in which s 8(2) appears or seeking guidance from the objects of the ICAC Act as stated in s 2A. Rather, as Mason J stated in K & S Lake City Freighters Pty Ltd v Gordon & Gotch Ltd, it was and is essential to do so50: "[T]o read the section in isolation from the enactment of which it forms a part is to offend against the cardinal rule of statutory interpretation that requires the words of a statute to be read in their context: Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation51; Attorney- General v Prince Ernest Augustus of Hanover52. Problems of legal 49 Cunneen [2014] NSWCA 421 at [61]. 50 (1985) 157 CLR 309 at 315; [1985] HCA 48. See also Commissioner for Railways (NSW) v Agalianos (1955) 92 CLR 390 at 397 per Dixon CJ; [1955] HCA 27; CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408 per Brennan CJ, Dawson, Toohey and Gummow JJ; [1997] HCA 2; Project Blue Sky (1998) 194 CLR 355 at 381 [69]; Pearce and Geddes, Statutory Interpretation in Australia, 8th ed (2014) at 148 [4.3]. 51 (1981) 147 CLR 297 at 304 per Gibbs CJ, 319-320 per Mason and Wilson JJ; [1981] HCA 26. 52 [1957] AC 436 at 461 per Viscount Simonds, 473 per Lord Somervell of Harrow. Hayne Nettle interpretation are not solved satisfactorily by ritual incantations which emphasize the clarity of meaning which words have when viewed in isolation, divorced from their context. The modern approach to interpretation insists that the context be considered in the first instance, especially in the case of general words, and not merely at some later stage when ambiguity might be thought to arise." Counsel for ICAC further submitted that, even if that were so, "corruption" was an expression of such uncertain connotation – as noted earlier, he suggested that it might mean no more than alteration or marring – that there was no warrant for inferring from the objects of the ICAC Act stated in s 2A that the kind of corrupt conduct defined in s 8(2) is limited accordingly. So to reason, however, is to invert proper processes of construction. It amounts to assuming that the words of s 8(2) are used in their broadest possible sense and then excluding all the contextual indications which imply that they have a more narrow and focussed meaning. Expressions of indefinite connotation are especially susceptible to context. They may and frequently do mean one thing in one legislative context and something quite different in another. To ignore context in those circumstances is calculated to lead to error53. For the reasons that have been given, the provisions of the ICAC Act as a whole (including s 2A) operate more harmoniously on the footing that the Act is directed integrity and accountability of public administration in the sense of maintaining probity in the exercise of official functions. That is the context from which the relevant concept of "corruption" emerges. towards promoting the As has been mentioned, counsel for ICAC also criticised the approach of the majority of the Court of Appeal as in effect making the mistake identified in Shin Kobe Maru of seeking to interpret a defined term by reference to the term itself. But, as has been explained, that was not the case. If there were any difficulty with the way in which the majority approached the matter, it was by appearing to apply syllogistic reasoning to identify the meaning of "adversely affect" by reference to the purpose of the Act in circumstances where it is not possible to identify the purpose without reference to the provisions to be interpreted. 53 See, eg, Corkery v Carpenter [1951] 1 KB 102 at 105-106 per Lord Goddard CJ; Australasian Performing Right Association Ltd v Commonwealth Bank of Australia (1992) 40 FCR 59 at 62 per Gummow J; Pearce and Geddes, Statutory Interpretation in Australia, 8th ed (2014) at 148 [4.3]. Hayne Nettle Counsel for ICAC invoked the observations of Brennan CJ, Gaudron and McHugh JJ in PMT Partners Pty Ltd (In liq) v Australian National Parks and Wildlife Service54 in support of his submission that one may not depart from the plain and ordinary meaning of "adversely affect" unless it is clearly necessary to do so and, counsel contended, it was not clearly necessary to do so. The problem with that submission is likewise that, so far from having a plain and ordinary meaning, "adversely affect" is a term of uncertain connotation which derives its intended meaning from its context. As their Honours said in PMT Partners55, a statutory definition is susceptible to limitation where "clearly required by ... its context, as for example if it is necessary to give effect to the evident purpose of the Act". In context, as demonstrated above, the expression means to affect adversely the probity of the exercise of an official function by a public official in one of the ways described in s 8(1)(b)-(d). Finally, counsel for ICAC invoked s 12A as an indication, he submitted, that ICAC was intended to have very broad powers subject only to the exercise of its discretion to direct its attention to what it considers to be serious corrupt conduct and systemic corrupt conduct. That submission must also be rejected. The fact that ICAC is directed to concentrate on serious and systemic "corrupt conduct" says nothing about the meaning of "corrupt conduct", or at least nothing that aids ICAC's contentions. The possible alternative construction It remains to deal with the possible alternative construction of s 8(2) earlier referred to, according to which the relative clause "and which could involve" would be read as limiting and defining "the exercise of official functions" as opposed to the "conduct". There are at least five reasons why the alternative construction should be rejected. To begin with, it is syntactically difficult to accommodate. The only possible indication that the "which could involve" clause might be directed to the exercise of official functions, as opposed to the conduct, is the change from the pronoun "that", which appears as the first word of the clause "that adversely affects ... the exercise of official functions", to the pronoun "which", which 54 (1995) 184 CLR 301 at 310; [1995] HCA 36. (1995) 184 CLR 301 at 310 per Brennan CJ, Gaudron and McHugh JJ (footnotes omitted). Hayne Nettle appears as the first word of the clause "which could involve". Of itself, the change in pronoun is not a strong indication of anything. As counsel for ICAC submitted, if the "which could involve" clause were intended to control the exercise of official functions, it is more likely that the conjunction "and" which precedes it would have been deleted. Additionally, the only preceding expression of equal grammatical weight to the "and which could involve" clause is the "that could adversely affect" clause. As a matter of English usage, that implies that the "and which could involve" clause, like the "that could adversely affect" clause, is directed to the conduct56. Secondly, to the extent that anything can be drawn from the extrinsic materials, the understanding of s 8(2) expressed in the Explanatory Note relating to the Independent Commission Against Corruption Bill 1988 (No 2)57 was that the "and which could involve" clause related to the conduct. Thirdly, as has been seen, there are a number of previous decisions in which s 8(2) has been approached expressly or implicitly on the basis that the "and which could involve" clause governs the conduct as opposed to the exercise of official functions. Fourthly, for the reasons already given, if the "that could adversely affect" clause is construed according to its natural and ordinary meaning in the context in which it appears, it limits the operation of s 8(2) to conduct that could have the effect of adversely affecting the probity of the exercise of an official function by a public official in one or other of the ways described in s 8(1)(b)-(d). As such, it renders unlikely that the "and which could involve" clause was intended to impose some further restriction on the nature of the improbity in the exercise of an official function caused by conduct to which s 8(2) is directed. It is more likely that s 8(2) was intended to cover conduct which could adversely affect the probity of the exercise of an official function by a public official in any of the ways described in s 8(1)(b)-(d), provided the conduct satisfies one or other of the descriptions listed in s 8(2)(a)-(y) and, perforce of s 9, that it constitutes or involves a criminal offence or other breach of a relevant standard of conduct. Finally, many of the offences listed in s 8(2)(a)-(y), such as bribery, blackmail, offering secret commissions, treating, tax and revenue evasion, 56 See Burchfield, Fowler's Modern English Usage, 3rd ed (rev) (2004) at 357-358, "hendiadys". 57 New South Wales, Independent Commission Against Corruption Bill 1988 (No 2), Explanatory Note at 2. Hayne Nettle currency violations, drug dealing and illegal gambling, are of a nature which logically could adversely affect the probity of the exercise of an official function by a public official but at the same time are unlikely to be capable of commission by a public official in the exercise of an official function. Conclusion It was not disputed that, if "adversely affect ... the exercise of official functions by any public official" in s 8(2) means adversely affect the probity of the exercise of an official function by a public official in one of the ways listed in s 8(1)(b)-(d), the alleged conduct was not corrupt conduct within the meaning of ICAC sought special leave to appeal against the orders of the Court of Appeal. The application for special leave was referred for argument before an enlarged bench as on an appeal. The respondents submitted that special leave should be refused. But in light of the way in which the disputed question of construction of the ICAC Act should be resolved, it is better that special leave be granted, the appeal treated as instituted and heard instanter and dismissed with costs. GAGELER J. The question of public importance, on which special leave to appeal is sought, is whether ICAC has power to investigate an allegation of criminal conduct having the potential to impede or impair the exercise of an official function by a public official in a manner involving no wrongdoing on the part of that public official. The question is about whether ICAC has power to undertake any investigation into any allegation of criminal conduct of that nature. The question is not about the propriety or prudence of ICAC choosing to undertake the particular investigation in this case. I would grant special leave to appeal, determine the question in the affirmative, and allow the appeal. To explain at the outset how I differ from the majority in this Court, I consider it sufficient, to be investigated by ICAC, that criminal conduct has the potential to impair the efficacy of an exercise of an official function by a public official. I do not consider it necessary that the criminal conduct has the potential to affect the probity of an exercise of an official function by a public official. My reasons accord substantially with those of Bathurst CJ in dissent in the Court of Appeal. In stating my reasons, I adopt the abbreviations of the majority in this Court. The word "corruption" appears in the ICAC Act in its title and in its objects clause. The word connotes moral impropriety in, or in relation to, public administration. It has never acquired a more precise meaning in the language of the law or in ordinary speech58. Standard dictionary definitions of "corrupt", used as an adjective, provide a range of meanings, from "dishonest" or "without integrity" to "infected" or "tainted"59. The operative provisions of the ICAC Act do not use the word "corruption". They use the term "corrupt conduct". That term is the subject of elaborate definition in ss 7, 8 and 9 of the ICAC Act. In construing that definition, as in construing any other statutory definition, it is "of fundamental importance" that the language of the definition is accorded its "natural and ordinary meaning unless some other course is clearly required", and that "limitations and qualifications are not read into" the definition unless "clearly required by its terms or its context"60. That is not to "make a fortress out of the 58 Drummoyne Municipal Council v Australian Broadcasting Corporation (1990) 21 NSWLR 135 at 138. 59 Eg Macquarie Dictionary, 6th ed (2013) at 339, senses 1 and 4. 60 PMT Partners Pty Ltd (In liq) v Australian National Parks and Wildlife Service (1995) 184 CLR 301 at 310; [1995] HCA 36. dictionary"61. It is not to underplay the significance of context. It is rather to recognise that a statutory definition is ordinarily framed in language chosen for the grammatical meaning it conveys. The definition of a term is the creation of the most basic building block of a statutory structure. The structure of the definition in ss 7, 8 and 9 of the ICAC Act is complex, and the language in which each of its component sections is framed is cumbersome. The focus for the purpose of determining the present question is on the language of s 8(2). Within the structure of the definition, s 8(2) describes a category of corrupt conduct in addition to the categories described in s 8(1). Section 8(6) makes clear that the categories so described in s 8(1) and s 8(2) are not to be read as limiting each other. Conduct which meets a description in either or both of s 8(1) or s 8(2) is included within the definition of "corrupt conduct" unless excluded by s 9. The present question turns on the content, within that structure, of the description by s 8(2) of corrupt conduct as "any conduct of any person (whether or not a public official) that adversely affects, or that could adversely affect ... the exercise of official functions by any public official ... and which could involve any of the ... matters" in pars (a) to (y) of s 8(2). The description is designedly of conduct which is in addition to (although it may overlap with) that described in s 8(1)(a) as "any conduct of any person (whether or not a public official) that adversely affects, or that could adversely affect ... the honest or impartial exercise of official functions by any public official". Both descriptions are of conduct which is then excluded by s 9 from corrupt conduct unless it could constitute or involve "a criminal offence" or one of the other categories of conduct in pars (a) to (d) of s 9(1). Together with the other members of the Court of Appeal, Bathurst CJ assumed that s 8(2) describes conduct which meets two distinct conditions. The first condition is that the conduct adversely affects or could adversely affect the exercise of official functions by a public official. The second condition is that the same conduct could involve any of the matters in pars (a) to (y) of s 8(2). The difference between Bathurst CJ and the members of the Court of Appeal who formed the majority was in the content each thought it appropriate to give to the words "could adversely affect" in the first of those conditions. To Bathurst CJ, the words require no more than that the conduct have the potential to limit or prevent the proper exercise of official functions by the public 61 Residual Assco Group Ltd v Spalvins (2000) 202 CLR 629 at 644 [27]; [2000] HCA 33, quoting Cabell v Markham 148 F 2d 737 at 739 (1945). official62. To Basten and Ward JJA, the words require the conduct to have the potential to lead the public official to exercise official functions in a way that is "dishonest, partial or otherwise corrupt"63. On the issue which divided the members of the Court of Appeal and on which I differ from the majority in this Court, I consider the view of Bathurst CJ to be the preferable reading of the statutory text for a number of mutually reinforcing textual reasons. First, it accords to the words "could adversely affect" in s 8(2) an ordinary grammatical meaning, identical to the ordinary grammatical meaning of the same words in s 8(1)(a). The ordinary grammatical meaning connotes nothing more than impediment or impairment. Second, it imports no unexpressed qualitative element into the nature of that impediment or impairment. It avoids reading into s 8(2) a limitation or qualification which is not expressed in the text of s 8(2), but which is expressed, at least in part, in the text of s 8(1)(a). Third, in so doing, it gives s 8(2) a relatively precise operation which depends entirely on the language of that sub-section. That in turn gives the defined term "corrupt conduct" a relatively precise operation which does not depend on drawing some negative implication from the undefined and indefinite concept of corruption. The objects clause, s 2A, can be read as pointing in a different direction only if some particular and legislatively unexpressed limitation is read into its use of the word "corruption". The significance of the objects clause is quite different if that word is read, as I think it should be, as an introductory and generic description of the phenomenon described with precision in the definition of "corrupt conduct" in ss 7, 8 and 9. Section 2A(a)(i) can then be seen to indicate that corrupt conduct, which ICAC has been constituted "to investigate, expose and prevent", extends not only to that "involving" public officials (the focus of s 8(1)) but additionally to that "affecting" public officials (the focus of s 8(2)). Section 2A(a)(i), when so understood, supports the grammatical reading of s 8(2) as descriptive of conduct which has the potential to affect a public official, by limiting or preventing the exercise of an official function by a public official, without necessity for any wrongdoing (or want of probity) on the part of that public official. That reading of s 8(2) (as descriptive of conduct having the potential to limit or prevent the exercise of an official function by a public official, without necessity for any wrongdoing on the part of that public official) and that reading 62 Cunneen v Independent Commission Against Corruption [2014] NSWCA 421 at 63 Cunneen v Independent Commission Against Corruption [2014] NSWCA 421 at of s 2A (as confirming rather than confining the broad reading of s 8(2)) is supported by legislative history. I will come to the legislative history later. On the issue which divided the members of the Court of Appeal and on which I differ from the majority in this Court, it is appropriate at this point to make two observations. One is that, in light of provisions within the ICAC Act (inserted after the decision of this Court in Balog v Independent Commission Against Corruption64) which make clear that ICAC has no power to make, opine on and report any finding of criminal guilt65, no principle or presumption of the common law requires a particularly narrow construction of the provisions which define the scope of the alleged conduct which ICAC is permitted to investigate and expose66. None was suggested in the Court of Appeal. Mention was made of the "principle of legality" in written submissions in this Court. No attempt was made, however, to identify any right or principle said to be put in jeopardy by an interpretation of the ICAC Act which would permit ICAC to investigate criminal conduct which has the potential to impair the efficacy of an exercise of an official function by a public official as distinct from limiting ICAC to investigating criminal conduct which has the potential to impact on the probity of an exercise of an official function by a public official. That ICAC can exercise coercive powers in derogation of common law rights is a reason for favouring a narrow purposive construction of the provisions of the ICAC Act which confer those coercive powers, if and to the extent that the scope of those provisions is unclear. That ICAC can exercise those coercive powers for the purpose of conducting investigations is no reason for straining to adopt a narrow interpretation of the provisions of the ICAC Act which define the scope of the corrupt conduct ICAC is empowered to investigate. There is no common law right not to be investigated for a crime. Unfocussed invocation of the common law principle of construction sometimes now labelled the "principle of legality" can only weaken its normative force, decrease the predictability of its application, and ultimately call into question its democratic legitimacy. 64 (1990) 169 CLR 625; [1990] HCA 28. 65 Sections 13(4) and 74B. 66 Cf Australian Communications and Media Authority v Today FM (Sydney) Pty Ltd (2015) 89 ALJR 382 at 397 [68]-[69]; 317 ALR 279 at 296-297; [2015] HCA 7. The other observation appropriate to be made at this point is that it is important to acknowledge, as did Bathurst CJ67, that a consequence of reading the first condition in s 8(2) as describing any conduct which has the potential to limit or prevent the exercise of any official function by any public official, without necessity for any wrongdoing on the part of that public official, is that it brings within the definition of corrupt conduct any case of perverting the course of justice (the subject matter of par (g) of s 8(2)) as well as any case of attempting to pervert the course of justice (within the subject matter of par (y) of s 8(2)). That is so no matter how trivial or confined the conduct in question might be. Another consequence, accepted by counsel for ICAC in the course of argument, is that the reading brings within the inclusive element of that definition any case of tax evasion or revenue evasion (the subject matters of pars (m) and (n) of s 8(2)), no matter how small the revenue consequences and, again, no matter how trivial or confined the conduct might be. Whether the interpretation that I prefer has the effect of bringing within the definition of corrupt conduct all conduct which might fall within all of the ten enumerated examples given in the reasons for judgment of the majority in this Court was not explored in argument and is not something on which I find it necessary to reach a concluded view. I acknowledge that the reading would have the effect of bringing within the definition at least some conduct falling within most of the examples. What is equally important to acknowledge, however, is that a consequence of limiting the first condition in s 8(2) to conduct which has the potential to lead to some want of probity on the part of a public official in the exercise of an official function is entirely to exclude from the definition of corrupt conduct a case of fraud on a public official or of conspiracy to defraud a public official (within the subject matters of pars (e) and (y) of s 8(2)) which entails no wrongdoing by the public official. That is so no matter how widespread the conduct might appear and no matter how detrimental its effects on public administration or on the community or the environment. The choice, starkly illustrated, is between two extreme consequences. At one extreme is that to which the broader efficacy reading of s 8(2) leads: ICAC having power to investigate an isolated case of a witness telling a lie to a police officer. At the other extreme is that to which the narrower probity reading of s 8(2) leads: ICAC having no power to investigate, expose, prevent or educate about State-wide endemic collusion among tenderers in tendering for government contracts; as well as ICAC having no power to investigate, expose, prevent or educate about serious and systemic fraud in the making of applications for 67 Cunneen v Independent Commission Against Corruption [2014] NSWCA 421 at licences, permits or clearances issued under New South Wales statutes designed to protect health or safety (such as the Child Protection (Working with Children) Act 2012 (NSW) or the Work Health and Safety Act 2011 (NSW)) or under New South Wales statutes designed to facilitate the management and commercial exploitation of valuable State-owned natural resources (such as the Mining Act 1992 (NSW), the Fisheries Management Act 1994 (NSW) or the Forestry Act 2012 (NSW)). Either of those extreme consequences might plausibly be argued to be improbable or inconvenient in light of the objects appearing in s 2A of the ICAC Act68. That ICAC might be denied power to investigate, expose, prevent or educate about serious and systemic fraud is, I think, the less probable and the less convenient of the alternatives. But the choice between the alternatives need not be left to unguided inference about what the Parliament might or might not reasonably be taken to have intended. That ICAC has power to investigate corrupt conduct which need not be serious or systemic is the underlying premise of the permission which s 20(3) of the ICAC Act grants to ICAC (in considering whether or not to conduct, continue or discontinue an investigation) to have regard, amongst other considerations, to whether or not in ICAC's opinion "the subject-matter of [an] investigation is trivial". That ICAC has power to investigate, expose, prevent and educate about forms of corrupt conduct which might be neither serious nor systemic is further acknowledged and addressed in s 12A. Section 12A specifically requires that ICAC, in exercising its functions, "is, as far as practicable, to direct its attention to serious corrupt conduct and systemic corrupt conduct" (emphasis added). The same section goes on to address the potential for the exercise of ICAC's powers to overlap with those of conventional law enforcement agencies, by specifically requiring ICAC "to take into account the responsibility and role other public authorities and public officials have in the prevention of corrupt conduct". Sections 20(3) and 12A combine to provide a legislative answer to the arguable improbability or inconvenience illustrated by postulating the extreme example of ICAC having power to investigate an isolated case of a witness telling a lie to a police officer. The legislative answer is not to deny or withdraw that power. It is specifically to permit ICAC to refrain or disengage from an investigation into a particular allegation of corrupt conduct which ICAC assesses to be trivial, and more generally to guide ICAC in the exercise of its powers towards corrupt conduct that is either serious or systemic. 68 Cf Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation (1981) 147 CLR 297 at 320-321; [1981] HCA 26; CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408; [1997] HCA 2. It is necessary, however, to go beyond the issue which divided the members of the Court of Appeal. That is because the assumption of all members of the Court of Appeal, that s 8(2) describes conduct which meets two distinct conditions, was questioned in this Court. Here the possibility was raised of an alternative construction. The alternative construction would treat the words "which could involve" in s 8(2) as referring not to "any conduct of any person" but instead to "the exercise of official functions". Adoption of the alternative construction would result in s 8(2) being read as describing conduct which meets a single composite condition: that the conduct adversely affects or could adversely affect the exercise of official functions by a public official, which adverse exercise of functions by the public official could involve any of the matters in pars (a) to (y). Together with the majority in this Court, I reject the alternative construction. I accept that the alternative construction is textually available, even if it is somewhat textually awkward. I also accept that the alternative construction has the attraction of eliminating the substantial duplication to which the construction assumed by the members of the Court of Appeal gives rise, in that the alternative construction would eliminate the overlap between pars (a) to (y) of s 8(2) and pars (a) to (d) of s 9(1). Those paragraphs of s 8(2) and those paragraphs of s 9(1) would, on the alternative construction, refer to the conduct of different persons. Whatever its textual attraction, however, the alternative construction is not contextually open, in light of ss 2A and 12A, and in light of the legislative history of the ICAC Act. I now turn to that legislative history. Save for an amendment in 1990, substituting "which could involve" for "which involves"69, the text of s 8(2) has stood unaltered since the enactment of the ICAC Act in 1988. The Bill for the ICAC Act as originally enacted was accompanied by an explanatory note, which was then, and remains, permitted by statute to be taken into account either to confirm the plain meaning of the ICAC Act or to resolve an ambiguity in the ICAC Act70. The explanatory note to the Bill for the ICAC Act as originally enacted explained its legislative object as being to constitute ICAC and "to confer on it wide powers, with special emphasis on ... investigating corruption or possible corruption where public officials are involved"71. The explanatory note went on 69 Independent Commission Against Corruption (Amendment) Act 1990 (NSW), Sched 1, item 6. 70 Interpretation Act 1987 (NSW), s 34(1), (2)(e). 71 New South Wales, Independent Commission Against Corruption Bill 1988 (No 2), Explanatory Note at 1. to explain that "[t]he expression used in the Bill" was "corrupt conduct", which had "an extensive description" in cll 7 to 9 of the Bill72. After setting out the text of cl 8(1), the explanatory note said of cl 8(2)73: "Subclause (2) states that conduct is also corrupt conduct if it adversely affects, or could adversely affect, any exercise of official functions by a public official and it is of a criminal nature, eg bribery, obtaining or offering secret commissions or perverting the course of justice." That explanation of s 8(2) as it came to be enacted in the ICAC Act is unambiguous in explaining s 8(2) to refer to conduct which meets the two distinct conditions assumed by all members of the Court of Appeal: the first condition being that the conduct adversely affects, or could adversely affect, any exercise of any official function by a public official; the second condition being that the same conduct could involve any of the matters in pars (a) to (y) of s 8(2), being matters generally (although not exclusively) of a criminal nature. The understanding that s 8(2) as originally enacted described conduct which met those two distinct conditions was implicit in the observation made by Mason CJ, Deane, Dawson, Toohey and Gaudron JJ in Balog that "corrupt conduct", as defined in ss 7 to 9 of the ICAC Act, "includes conduct that adversely affects or could adversely affect the exercise of official functions and involves any one of a number of specified criminal offences, including bribery, blackmail, perverting the course of justice and the like"74. The same understanding was implicit in observations directed to the operation of s 8(2) (which in 1990 had been amended to take its current form) made by Gleeson CJ and Priestley JA in Greiner v Independent Commission Against Corruption75. Between 1990 and 2004, ICAC conducted many investigations, reports of which were presented to the Houses of Parliament and made public. The reports of a number of those investigations reveal that, conformably with the explanatory note to the Bill for the ICAC Act as originally enacted and with the observations in Balog and Greiner, ICAC conducted investigations on the understanding that s 8(2) described conduct which met the two distinct conditions of being conduct 72 New South Wales, Independent Commission Against Corruption Bill 1988 (No 2), Explanatory Note at 1. 73 New South Wales, Independent Commission Against Corruption Bill 1988 (No 2), Explanatory Note at 2. 74 (1990) 169 CLR 625 at 628. 75 (1992) 28 NSWLR 125 at 135, 182-184. that adversely affects or could adversely affect the exercise of official functions by a public official and that could involve any of the matters in pars (a) to (y) of s 8(2). The same reports also reveal that ICAC conducted investigations on the understanding that the first condition was met where the conduct had the potential to impair the efficacy of an exercise of an official function by a public official. illustrate the outworking of Two examples will suffice that understanding. One was a report, presented to the Houses of Parliament and published in November 2003, entitled "Report on investigation into certain applications made to the Department of Fair Trading for building and trade licences". ICAC found in that report that a named individual had engaged in corrupt conduct within the description in s 8(2) by fraudulently providing forged documents and false information concerning trade qualifications in applications for trade licences which he submitted to the Department of Fair Trading on behalf of other persons whom he charged high fees76. ICAC recommended that the Department consider a number of changes to its policies and procedures for the purpose of detecting and preventing fraud of that nature77. The other was a report, presented and published in December 2003, entitled "Report on investigation into Mr Glen Oakley's use of false academic qualifications". ICAC found in that report that, over a period of 15 years, a named individual had created and used false academic qualifications for the purpose of applying for employment, which he was successful in obtaining, with a number of public authorities in New South Wales78. That conduct was explained by ICAC to fall within s 8(2) because it was "conduct that involve[d] fraud and forgery and could adversely affect the exercise of official functions by a public official in considering Mr Oakley's applications for the positions for which he applied, evaluating his candidacy for the positions, and, where his applications were successful, causing him to be appointed to the relevant position"79. ICAC explained its reasons for conducting the investigation to 76 Independent Commission Against Corruption, Report on investigation into certain applications made to the Department of Fair Trading for building and trade licences, (2003) at 30-36. 77 Independent Commission Against Corruption, Report on investigation into certain applications made to the Department of Fair Trading for building and trade licences, (2003) at 37-40. 78 Independent Commission Against Corruption, Report on investigation into Mr Glen Oakley's use of false academic qualifications, (2003) at 7. 79 Independent Commission Against Corruption, Report on investigation into Mr Glen Oakley's use of false academic qualifications, (2003) at 16. include ensuring integrity in public sector recruitment processes, emphasising that "[t]he public have a right to expect not only that those appointed to public sector positions are appropriately qualified but that they are honest"80. ICAC went on in the report to recommend a number of specific changes to the recruitment policies of public sector agencies81. In both examples, ICAC investigated and reported on conduct which had the potential to impair the efficacy of an exercise of an official function by a public official. Neither would have been within ICAC's power had s 8(2) been interpreted as confining corrupt conduct to conduct having the potential to impair the probity of an exercise of an official function by a public official. It was against that background of judicial exposition and administrative practice that the Governor of New South Wales in late 2004 commissioned Mr Bruce McClintock SC to conduct a review into the ICAC Act for the purpose of determining whether its objectives82. Mr McClintock's commission required him, as part of that review, to consider a range of specified topics. Those topics included "whether the functions of ICAC remain appropriate" and "the definition of corrupt conduct, and the capacity of ICAC to make findings of corrupt conduct"83. terms remained appropriate to securing its Mr McClintock's report, which he presented to the Governor in early 2005, contained a number of recommendations. Most, but not all, of those recommendations were taken up by the Parliament later in 2005 in amendments it made to the ICAC Act by the Independent Commission Against Corruption Amendment Act 2005 (NSW) ("the 2005 Amendment Act"). The principal significance of Mr McClintock's report for present purposes lies in the detailed explanation Mr McClintock there gave of the scope and operation of the definition of corrupt conduct. Mr McClintock expressed the view that the definition was not overly broad and had not been applied unfairly84. 80 Independent Commission Against Corruption, Report on investigation into Mr Glen Oakley's use of false academic qualifications, (2003) at 8. 81 Independent Commission Against Corruption, Report on investigation into Mr Glen Oakley's use of false academic qualifications, (2003) at 23. 82 McClintock, Independent Review of the Independent Commission Against Corruption Act 1988: Final Report, (2005) at viii. 83 McClintock, Independent Review of the Independent Commission Against Corruption Act 1988: Final Report, (2005) at viii. 84 McClintock, Independent Review of the Independent Commission Against Corruption Act 1988: Final Report, (2005) at 52 [4.2.25]. He said that, with the exception only of the report considered in Greiner, his attention had not been drawn to any investigation or report of ICAC "where the conduct (if it occurred) was not clearly within what members of our community would readily agree was corrupt"85. He said that he did not regard that one example as establishing that the definition resulted in any serious or substantial injustice and did not consider that the definition should be amended to limit its breadth or generality86. "Whilst the definition of corrupt conduct is broad, general and complex", he said, "I do not consider that it is desirable to make substantive changes that will alter ICAC's investigatory jurisdiction."87 Consistently with the view on which ICAC had until then acted, Mr McClintock explained s 8(2) to extend to criminal conduct which had the potential to impair the efficacy of an exercise of an official function by a public official and which need not have the potential to impair the probity of an exercise of an official function by a public official. As Mr McClintock explained it88: "Section 8(2) corrupt conduct can be distinguished from section 8(1) conduct as it requires no wrongdoing on behalf of the public official. The conduct is corrupt because of its potential to adversely affect official functions, not because of any wrongdoing by the official. An example of section 8(2) corruption might be fraudulent action by person A that caused a public official to unknowingly hand over money to which person A was not entitled. This amounts to corruption because it undermines the integrity of public administration by the wrongful payment of public monies." That explanation of s 8(2) informed the criticisms which Mr McClintock went on to make of its drafting. He said89: 85 McClintock, Independent Review of the Independent Commission Against Corruption Act 1988: Final Report, (2005) at 52 [4.2.25]-[4.2.26]. 86 McClintock, Independent Review of the Independent Commission Against Corruption Act 1988: Final Report, (2005) at 52 [4.2.27]. 87 McClintock, Independent Review of the Independent Commission Against Corruption Act 1988: Final Report, (2005) at 52 [4.2.29]. 88 McClintock, Independent Review of the Independent Commission Against Corruption Act 1988: Final Report, (2005) at 53 [4.3.3]. 89 McClintock, Independent Review of the Independent Commission Against Corruption Act 1988: Final Report, (2005) at 53 [4.3.4] (emphasis in original). "There are two problems with this aspect of the definition. It is a different category of corruption as it requires no wrongdoing on behalf of a public official. Further, it is circular and otiose to apply section 9 to section 8(2) corrupt conduct, given the lengthy list of criminal conduct included in the latter section." Mr McClintock continued90: "For these reasons, consideration should be given to re-drafting section 8 to distinguish more clearly between corrupt conduct by public officials and corruption of public administration, the latter being conduct that does not require any wrongdoing on the part of a public official. This could be achieved by section 8(2) corruption being classified as indirect corruption, placed in a separate section, and no longer being subject to the operation of section 9. Alternatively, it could be placed in a separate section, the list of items of criminal conduct deleted but remain subject to section 9." Mr McClintock went on specifically to recommend that, subject to another recommendation which he made concerning s 9 (which is of no present relevance)91: "[N]o substantial amendments to the definition of corrupt conduct in sections 7-9 of the Act be made, except to redraft the provisions to more clearly distinguish between corruption by public officials and corruption that adversely affects the performance of public official functions, without involving official wrongdoing." That recommendation by Mr McClintock was not taken up in the 2005 Amendment Act in so far as the recommendation was that ss 7 to 9 be redrafted. The 2005 Amendment Act did amend s 9 in a minor way, but it left s 8 entirely unaltered. That cannot be treated as legislative oversight, but rather as a considered legislative judgment. The explanatory note to the Bill for the 2005 Amendment Act contained the statement92: "The definition of corrupt conduct in sections 8 and 9 of the Principal Act is crucial to the effectiveness of ICAC as it defines the scope of its power 90 McClintock, Independent Review of the Independent Commission Against Corruption Act 1988: Final Report, (2005) at 53 [4.3.5] (emphasis in original). 91 McClintock, Independent Review of the Independent Commission Against Corruption Act 1988: Final Report, (2005) at 53, recommendation R4.1. 92 New South Wales, Independent Commission Against Corruption Amendment Bill 2005, Explanatory Note at 6. to investigate corrupt conduct that has occurred, is occurring or is about to occur." The non-amendment of s 8(2) by the 2005 Amendment Act is consistent with the New South Wales Parliament's acceptance of the principal aspect of Mr McClintock's recommendation – that there be "no substantial amendments" to the definition of corrupt conduct in ss 7 to 9 of the ICAC Act – and with its concurrent rejection of the subsidiary aspect of his recommendation that those sections be redrafted in a more limited manner. What is significant in this respect is that, although Mr McClintock suggested that the sections could be redrafted so as to be expressed "more clearly", he did not suggest that there was any existing ambiguity. The redrafting he recommended was directed to highlighting and simplifying the description of the distinct category of corruption which he explained s 8(2) already to encompass: corruption adversely affecting the performance of public official functions, without involving official wrongdoing. That a legislature has refrained from amending a statutory provision following receipt of a report explaining the provision to have a particular textually available meaning is a factor which tells in favour of not departing from that meaning in construing the provision in the context of the statute as otherwise amended93. The weight to be afforded to any such aspect of legislative history must, of course, vary with the circumstances. The relevant circumstances here include: the specific focus of Mr McClintock's review on the scope and operation of the definition of corrupt conduct; the specificity and clarity of Mr McClintock's explanation of s 8(2); the consistency of his explanation with previous judicially articulated understandings of the operation of s 8(2); the consistency of his explanation with the view on which ICAC had acted in undertaking prior investigations which had been reported to the Houses of Parliament; and the obvious close attention given to the contents of Mr McClintock's report in the process of enactment of the 2005 Amendment Act. Those circumstances combine to make the Parliament's choice not to amend s 8(2) in light of the explanation of its meaning given by Mr McClintock a compelling reason for not departing from that meaning. Nothing in the extrinsic material accompanying the 2005 Amendment Act suggests that the construction of s 8(2) as explained by Mr McClintock was a Given that it was the construction which the Parliament disfavoured. construction on which ICAC had in fact acted in the past, the Parliament might be expected to have amended s 8(2) to make its true intention clear had the 93 Cf Fortress Credit Corporation (Australia) II Pty Ltd v Fletcher [2015] HCA 10 at intended Parliament disfavoured reject that construction, had Mr McClintock's recommendation that there be no substantive change to the scope of ICAC's investigatory jurisdiction, and had it intended instead to confine ICAC in the future to investigating criminal conduct which had the potential to affect the probity of an exercise of an official function by a public official. That is particularly so in light of the acknowledgement in the explanatory note to the Bill for the 2005 Amendment Act, to which I have already referred, that the definition of corrupt conduct in ss 8 and 9 of the ICAC Act was seen by the Parliament to be crucial to the effectiveness of ICAC. To complete the analysis of what can relevantly be drawn from the history of the ICAC Act, it remains to notice that two of the most significant of the recommendations which Mr McClintock made for the amendment of the ICAC Act were taken up almost word-for-word by the Parliament in the 2005 Amendment Act in the insertion of ss 2A and 12A94. It is important to recognise that those recommendations were made by Mr McClintock, and acted upon by the Parliament, against the background of Mr McClintock's explanation of the substantive operation of s 8(2) and against the background of his recommendation that there be no substantial amendments to the definition of corrupt conduct in ss 7 to 9. It is also important to recognise the nature of the role which Mr McClintock expressly attributed to ICAC in making those recommendations, and which the Parliament implicitly adopted in acting on them. Mr McClintock explained95: "ICAC complements, rather than replaces, the roles performed by other criminal justice institutions and oversight agencies. Its particular focus must be matters for which there is no other remedy – where there are serious allegations of corruption that are not amenable to ordinary policing methods, where there are corruption risks, or where public officials or bodies are unwilling or unable to investigate corruption allegations or implement anti-corruption strategies." That it was the role of ICAC to be in a position to step in where conventional law enforcement agencies were unwilling or unable to cope informed both the breadth of the statement of objectives in s 2A and the 94 McClintock, Independent Review of the Independent Commission Against Corruption Act 1988: Final Report, (2005) at 24, recommendation R2.1 and 29- 30, recommendation R2.2. 95 McClintock, Independent Review of the Independent Commission Against Corruption Act 1988: Final Report, (2005) at 23 [2.1.8]. See also at 29 [2.8.7]. specificity of the direction given in s 12A96. Echoing the justification given by Mr McClintock for his recommendation that the ICAC Act be amended to specify its objectives, the explanatory note to the Bill for the 2005 Amendment Act explained that the purpose of the insertion of the new s 2A was "to specify the objectives of the Act and so to confirm the role of ICAC as an independent and accountable body with special powers to inquire into allegations of corruption"97. Neither the report nor the explanatory note contained any hint that the specification of the objectives in s 2A was in any way to confine or otherwise affect the definition of corrupt conduct in ss 7 to 9 of the ICAC Act. 96 McClintock, Independent Review of the Independent Commission Against Corruption Act 1988: Final Report, (2005) at 23 [2.1.8], 29 [2.8.7]. 97 New South Wales, Independent Commission Against Corruption Amendment Bill 2005, Explanatory Note at 3 (emphasis added).

HIGH COURT OF AUSTRALIA McHUGH ACJ, NETWORK TEN PTY LIMITED APPELLANT AND TCN CHANNEL NINE PTY LIMITED & ORS RESPONDENTS Network Ten Pty Limited v TCN Channel Nine Pty Limited [2004] HCA 14 11 March 2004 1. Appeal allowed with costs. ORDER 2. Orders of the Full Court of the Federal Court entered on 19 July 2002 set aside. 3. Matter remitted to the Full Court of the Federal Court to determine the remaining issues in the appeal to that Court and to make the appropriate orders consistent with the judgment of this Court and upon its further consideration of the appeal, including orders disposing of the costs of the appeal to the Full Court. On appeal from the Federal Court of Australia Representation: J M Ireland QC with R Cobden and C Dimitriadis for the appellant (instructed by Blake Dawson Waldron) A J L Bannon SC with D T Kell for the respondents (instructed by Gilbert & Tobin) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Network Ten Pty Limited v TCN Channel Nine Pty Limited Copyright – Infringement – Television broadcast – Television programme broadcast by appellant contained excerpts from programmes previously broadcast by respondent – Each excerpt of brief duration – Meaning of the "subject matter" of broadcast copyright – Whether each visual image capable of being observed as a separate image on a television screen and accompanying sounds is "a television broadcast" in which copyright subsists – Whether a "substantial part" of a television broadcast must be copied to constitute infringement. Statutes – Construction and interpretation – Relevance of legislative history and context – Relevance of legislative history and context of similar United Kingdom statute – Copyright Act 1968 (Cth), ss 25(4), 87. Words and phrases – "broadcast", "television broadcast", "re-broadcast", "programme", "subject-matter", "substantial part", "fixation". Copyright Act 1968 (Cth), ss 14(1), 25(4), 87, 91, 101. Broadcasting Services Act 1992 (Cth), ss 6(1), 14. McHUGH ACJ, GUMMOW AND HAYNE JJ. This appeal is brought from the decision of the Full Court of the Federal Court of Australia (Sundberg, Finkelstein and Hely JJ)1 which allowed in part an appeal by the respondents against judgments at the trial before Conti J2. The issues which arise turn upon the provisions of the Copyright Act 1968 (Cth) ("the Act") as they stood before the commencement on 4 March 2001 of the Copyright Amendment (Digital Agenda) Act 2000 (Cth) ("the Amendment Act")3. The appellant ("Ten") is the holding company of the Ten Network, and each of the respondents ("Nine") is part of the Nine Network. The relevant corporate actors in the events giving rise to the litigation held the appropriate commercial television broadcasting licences under the Broadcasting Services Act 1992 (Cth) ("the Broadcasting Act"). The litigation concerned alleged infringement by Ten of the copyrights of Nine in certain television broadcasts. The Ten Network broadcast a weekly television programme entitled The Panel, which included 20 extracts from programmes previously broadcast by the Nine Network. These were used in 15 different episodes of The Panel broadcast in 1999 and 2000. Before that use, each extract (referred to in the judgments in the Federal Court as the "Panel Segments") was placed on an individual video tape. The Panel Segments ranged in duration from eight to 42 seconds. They were taken from programmes of the usual advertised length of 30 minutes to one hour. The programmes of The Panel were produced for Ten by a contracted production company, Working Dog Pty Ltd ("Working Dog"). It appears that Working Dog retained ownership of the master tapes and its copyrights therein and for reward granted to Ten the rights to one free-to-air live broadcast on Ten and its affiliates. The litigation instituted by Nine was against Ten, not Working Dog. The injunctive relief sought by Nine was to restrain the re-broadcasting "on the television program 'The Panel' ... of a substantial parts [sic] of any 1 TCN Channel Nine Pty Ltd v Network Ten Pty Ltd (2002) 118 FCR 417. 2 TCN Channel Nine v Network Ten (2001) 108 FCR 235; TCN Channel Nine v Network Ten (No 2) (2001) AIPC ¶91-732. 3 The Act sufficiently appears for the purposes of these reasons in Reprint 8. McHugh ACJ Gummow Hayne television broadcasts by [Nine] without [its] consent". Nine also claimed a declaration of infringement of the "broadcast copyright" of Nine in each of the episodes of what were identified as "the television programs known as [for example, The Today Show, A Current Affair, Australia's Most Wanted]". The Full Court granted declaratory relief and remitted to the primary judge any questions of further relief consequential upon the declaratory relief. At trial, Conti J held that Ten had not taken the whole or a substantial part of any of Nine's broadcasts. Those findings were reversed in the Full Court. Hely J delivered the leading judgment. Sundberg J agreed with Hely J and with additional reasons given by Finkelstein J for the conclusion that Ten had infringed the copyright of Nine in its television broadcasts. There were fair dealing defences under ss 103A and 103B of the Act. These partly succeeded, but do not arise for consideration in this Court. Nine seeks to uphold the Full Court decision in its favour that each visual image capable of being observed as a separate image on a television screen and accompanying sounds is "a television broadcast" in which copyright subsists. The gist of Ten's complaint is that the term "a television broadcast" as it appears in the Act was misread by the Full Court, with the result that the content of that expression is so reduced that questions of substantiality have no practical operation and the ambit of the copyright monopoly is expanded beyond the interests the legislation seeks to protect. Ten's submissions should be accepted and the appeal allowed. Statutory interpretation The submissions for Nine initially eschewed any detailed consideration of the anterior legal and historical context in the United Kingdom; this was despite the significance of the British legislation which then followed, upon the later Australian legislation. Nine also stressed the significance of what were said to be the plain words of the provisions of the Act immediately in issue and sought to discount any reaction to the decision of the Full Court which emphasised that the construction favoured by the Full Court appeared to be at odds with the overall scheme of the Act. Accordingly, it is convenient now to restate several of the relevant principles or precepts of statutory interpretation. In Newcastle City Council v GIO General Ltd4, McHugh J observed: (1997) 191 CLR 85 at 112. See also the observations of Windeyer J in Attorney- General (NSW) v Stocks and Holdings (Constructors) Pty Ltd (1970) 124 CLR 262 McHugh ACJ Gummow Hayne "[A] court is permitted to have regard to the words used by the legislature in their legal and historical context and, in appropriate cases, to give them a meaning that will give effect to any purpose of the legislation that can be deduced from that context." His Honour went on to refer to what had been said in the joint judgment in CIC Insurance Ltd v Bankstown Football Club Ltd5. There, Brennan CJ, Dawson, Toohey and Gummow JJ said6: "It is well settled that at common law, apart from any reliance upon s 15AB of the Acts Interpretation Act 1901 (Cth), the court may have regard to reports of law reform bodies to ascertain the mischief which a statute is intended to cure7. Moreover, the modern approach to statutory interpretation (a) insists that the context be considered in the first instance, not merely at some later stage when ambiguity might be thought to arise, and (b) uses 'context' in its widest sense to include such things as the existing state of the law and the mischief which, by legitimate means such as those just mentioned, one may discern the statute was intended to remedy8. Instances of general words in a statute being so constrained by their context are numerous. In particular, as McHugh JA pointed out in Isherwood v Butler Pollnow Pty Ltd9, if the apparently plain words of a provision are read in the light of the mischief which the statute was designed to overcome and of the objects of the legislation, they may wear a very different appearance. Further, inconvenience or improbability of result may assist the court in preferring to the literal meaning an (1997) 187 CLR 384. (1997) 187 CLR 384 at 408. 7 Black-Clawson v Papierwerke Waldhof-Aschaffenburg Aktiengesellschaft [1975] AC 591 at 614, 629, 638; Wacando v The Commonwealth (1981) 148 CLR 1 at 25-26; Pepper v Hart [1993] AC 593 at 630. International Ltd 8 Attorney-General v Prince Ernest Augustus of Hanover [1957] AC 436 at 461, cited in K & S Lake City Freighters Pty Ltd v Gordon & Gotch Ltd (1985) 157 CLR 309 at 312, 315. (1986) 6 NSWLR 363 at 388. McHugh ACJ Gummow Hayne alternative construction which, by the steps identified above, is reasonably open and more closely conforms to the legislative intent10." The context in which the broadcasting right was introduced, including well-established principles of copyright law, the inconvenience and improbability of the result obtained in the Full Court, and a close consideration of the text of various provisions of the Act relating to the broadcasting right, combine to constrain the construction given to the Act by the Full Court and to indicate that the appeal to this Court should be allowed. Reference first will be made to two well-established principles, those concerned with the significance of copying, and with the taking of a substantial part of the protected material. Attention then will be given to the legislative context in which the broadcasting right first appeared, and thereafter to the particular issues of statutory construction involved in the appeal. Copyright and copying Counsel for Nine invoked a well-known statement made in University of London Press Ltd v University Tutorial Press Ltd11. This was a case of infringement of copyright in an original literary work and Peterson J applied "the rough practical test that what is worth copying is prima facie worth protecting". But later authorities correctly emphasise that, whilst copying is an essential element in infringement to provide a causal connection between the plaintiff's intellectual property and the alleged infringement12, it does not follow that any copying will infringe. The point was stressed by Laddie J when he said13: "Furthermore many copyright cases involve defendants who have blatantly stolen the result of the plaintiff's labours. This has led courts, sometimes with almost evangelical fervour, to apply the commandment 'thou shalt not steal'. If that has necessitated pushing the boundaries of copyright protection further out, then that has been done. This has resulted in a body of case law on copyright which, in some of its further 10 Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation (1981) 147 CLR 297 at 320-321. 11 [1916] 2 Ch 601 at 610. 12 Copinger and Skone James on Copyright, 14th ed (1999), vol 1, §7.08. 13 Autospin (Oil Seals) Ltd v Beehive Spinning [1995] RPC 683 at 700. See also Copinger and Skone James on Copyright, 14th ed (1999), vol 1, §7.31. McHugh ACJ Gummow Hayne reaches, would come as a surprise to the draughtsmen of the legislation to which it is supposed to give effect." Professor Waddams, speaking of the use of terms such as "piracy", "robbery" and "theft" to stigmatise the conduct of alleged infringers of intellectual property rights, describes "the choice of rhetoric" as "significant, showing the persuasive power of proprietary concepts"14. He also remarks15: "Against the merits of enlarging the property rights of one person or class of persons must always be set the loss of freedom of action that such enlargement inevitably causes to others." In another English decision, Jacob J16 identified Peterson J's aphorism in University of London Press as an indication of the dangers in departing too far from the text and structure of the legislation; his Lordship said that the aphorism "proves too much" because if "taken literally [it] would mean that all a plaintiff ever had to do was to prove copying" so that "appropriate subject matter for copyright and a taking of a substantial part would all be proved in one go". In Australia, the dangers in the use of the remarks in University of London Press were explained by Sackville J in Nationwide News Pty Ltd v Copyright Agency Ltd as follows17: "[T]he test has a certain 'bootstraps' quality about it. The issue of substantiality, in relation to a literary work, arises only where the work has been reproduced or published, at least in part. If applied literally, the test would mean that all cases of copying would be characterised as reproducing a substantial part of the work. It is therefore unlikely to be of great assistance in determining whether a particular reproduction involves a substantial part of a work or subject matter of copyright." 14 Dimensions of Private Law: Categories and concepts in Anglo-American legal reasoning, (2003) at 175-176. 15 Dimensions of Private Law: Categories and concepts in Anglo-American legal reasoning, (2003) at 174. 16 Ibcos Computers Ltd v Barclays Mercantile Highland Finance Ltd [1994] Fleet Street Reports 275 at 289. See also the decision of Pumfrey J in Cantor Fitzgerald International v Tradition (UK) Ltd [2000] RPC 95 at 133. 17 (1996) 65 FCR 399 at 417-418. McHugh ACJ Gummow Hayne "Substantial part" All the species of copyright enjoy a protection which is not limited to infringement by the taking of the whole of the protected subject-matter. The taking of something less will do. That lesser degree of exploitation is identified in s 14(1) by the phrase "a substantial part". The decision in Data Access Corporation v Powerflex Services Pty Ltd18 with respect to infringement of the literary works in computer programs provides a recent example of the operation of s 14(1). The sub-section states: "In this Act, unless the contrary intention appears: a reference to the doing of an act in relation to a work or other subject-matter shall be read as including a reference to the doing of that act in relation to a substantial part of the work or other subject-matter; and a reference to a reproduction, adaptation or copy of a work shall be read as including a reference to a reproduction, adaptation or copy of a substantial part of the work, as the case may be." The effect of the interpretation given by the Full Court to the term "television broadcast" and related expressions in the Act is to go beyond s 14(1) and provide that, with respect to any given period of broadcasting, however brief, the copyright owner has the exclusive right to re-broadcast any of the images and accompanying sounds broadcast. The term "substantial part" has a legislative pedigree. It appeared in s 1(2) of the Copyright Act 1911 (Imp) ("the 1911 Act"). The 1911 Act was repealed in 1956 by the Copyright Act 1956 (UK) ("the UK Act") and later excluded from further operation in Australia by s 5(1) of the Act. The inclusion of the term in the 1911 Act had reflected interpretation of earlier copyright legislation19. judicial 18 (1999) 202 CLR 1. 19 Bramwell v Halcomb (1836) 3 My & Cr 737 at 738 [40 ER 1110 at 1110]; Chatterton v Cave (1878) 3 App Cas 483 at 492; cf Hawkes & Son (London) Ltd v Paramount Film Service Ltd [1934] Ch 593 at 605-606. McHugh ACJ Gummow Hayne The scheme of the 1911 Act, as with the UK Act and the Australian legislation which succeeded it, keeps separate the concepts of substantial part and fair dealing. Accordingly20: "acts done in relation to insubstantial parts do not constitute an infringement of copyright and the defences of fair dealing only come into operation in relation to substantial parts or more". It would be quite wrong to approach an infringement claim on the footing that the question of the taking of a substantial part may be by-passed by going directly to the fair dealing defences. The legislative context In 1968, at the time of the enactment of the Act, the predecessor of the Broadcasting Act, the Broadcasting and Television Act 1942 (Cth) ("the 1942 Act"), was in force. As it stood in 1968, s 99(1) of the 1942 Act required the holder of a commercial television station licence to "provide programmes ... in accordance with standards determined by the [Australian Broadcasting Control] Board". the Australian Broadcasting Commission21, s 59 of the 1942 Act required the Commission to "provide, and ... broadcast or televise from transmitting stations made available by the Postmaster-General, adequate and comprehensive programmes". Section 121 of the 1942 Act prohibited the broadcasting of programmes of other stations, and s 132 rendered an offence the contravention of any provision of the 1942 Act22. With respect to what was then 20 Ricketson, The Law of Intellectual Property, (1984), §10.3. 21 Constituted by s 30 of the 1942 Act. 22 Section 121 (later repealed by s 86 of the Broadcasting and Television Amendment Act 1985 (Cth)) stated: "(1) Except with the consent of the owner or licensee of the broadcasting station whose programme it is desired to broadcast and, in the case of a broadcast which is a re-broadcast, with the approval of the Board – (a) the Commission shall not broadcast the whole or any part of the programme of a broadcasting station (whether situated in Australia or elsewhere) other than a national broadcasting station; and (b) the licensee of a commercial broadcasting station shall not broadcast the whole or any part of the programme of any (Footnote continues on next page) McHugh ACJ Gummow Hayne The Act was preceded by the Report ("the Spicer Report") delivered in 1959 of the Committee appointed by the Attorney-General of the Commonwealth to consider what alterations were desirable in the copyright law of the Commonwealth ("the Spicer Committee"). The Spicer Report had said it was significant that neither the Brussels Convention nor the Universal Copyright Convention recognised a copyright in sound broadcasts or television broadcasts (par 285)23. In the end, the Spicer Report concluded (pars 288, 289) that protection for broadcasters could properly be included in the copyright law with an adaptation of the provision then recently made by s 14 of the UK Act. The introduction by s 14 of the UK Act of the new species of copyright protection followed Recommendation 31 in the Report of the Copyright Committee24 ("the Gregory Report") which had been presented in 1952. Recommendation 31 had been: "That a broadcasting authority should have the right to prevent the copying of its programmes either by re-broadcasting, or by the making of records for sale and subsequent performance. (Paragraph 117)" Paragraphs 116 and 117 of the Gregory Report state the policy and objectives which were subsequently to find expression in the provisions of the Australian legislation upon which this appeal turns. Accordingly, pars 116 and 117 should be set out in full25: "116. We now turn to the question whether a new right should be given to the broadcasting organisations in their own programme, additional to any copyright there may be in the individual items which go to make up those programmes, and we deal at this stage solely with a right to prevent other persons from copying the programme either by way of other broadcasting station (whether situated in Australia or elsewhere). (2) In this section, 're-broadcast' means the reception and re-transmission of a broadcast." 23 See Ricketson, The Berne Convention for the Protection of Literary and Artistic Works: 1886-1986, (1987), §6.77. 24 Great Britain, (1952), Cmd 8662 at 120. 25 Great Britain, Report of the Copyright Committee, (1952), Cmd 8662 at 41. McHugh ACJ Gummow Hayne again broadcasting a programme (in the event of there being more than one broadcasting authority in the future) or by way of recording such programmes for subsequent performance in some other way. 117. On the question of copyright in the ordinary sense, the position of the [British Broadcasting Corporation ('the BBC')], as we see it, is not, in principle, very different from that of a gramophone company or a film company. It assembles its own programmes and transmits them at considerable cost and skill. When using copyright material it pays the copyright owner, and it seems to us nothing more than natural justice that it should be given the power to control any subsequent copying of these programmes by any means. It has been represented to us that the absence of such a right has already caused considerable embarrassment to the BBC. Apparently, indifferent reproductions both of sound and television programmes have been made, and sold to the public, to the detriment alike of the [BBC] and of those taking part. We consider that a right should be given to the BBC or any other broadcasting organisation to prevent this happening again. Any right so conferred would be additional to the right of the author or composer to prevent mechanical recording where copyright material is broadcast. It would also extend to prevent the mechanical recording of a broadcast of material which is either non-copyright, or of a nature in which a right to prevent recording may not, under the present law, subsist at all, eg news, talks, music-hall 'gags'." (emphasis added) In Australia, the Spicer Committee stressed the significance of the new head of copyright protection, saying (par 282): "The conception of copyright which has hitherto been accepted is one which extends protection against copying and performing in public any work insofar as it is reduced to a permanent form. Copyright has not been extended to confer such protection in relation to a mere spectacle or performance which is transitory of its very nature." In Victoria Park Racing and Recreation Grounds Co Ltd v Taylor26, the High Court had rejected the submission that by the expenditure of money the plaintiff had created a spectacle at its racecourse so that it had "a quasi-property in the 26 (1937) 58 CLR 479. See also Moorgate Tobacco Co Ltd v Philip Morris Ltd [No 2] (1984) 156 CLR 414 at 444-445; Campomar Sociedad, Limitada v Nike International Ltd (2000) 202 CLR 45 at 54-55 [4]; Australian Broadcasting Corporation v Lenah Game Meats Pty Ltd (2001) 208 CLR 199 at 248-250 [106]- McHugh ACJ Gummow Hayne spectacle which the law would protect"27 by enjoining the broadcast of a race-meeting there. The issue before the Spicer Committee was a different one, namely the protection of broadcasts themselves. The Spicer Committee added (par 284): "It is true that in many cases the broadcast will be recorded on tape or film, in which case the record or film will enjoy its own copyright protection, but the copyright here being considered is one which attaches to the broadcast itself." In the second reading speech on the Bill for the Act, the Attorney-General, Mr N H Bowen QC, said that the matters of records and broadcasts were dealt with in the UK Act and that it was appropriate to deal with them in the Bill28. He also referred to the provisions of the Rome Convention29 which had postdated the UK Act but to which Australia was yet to accede. The Rome Convention also provided for the grant of "neighbouring rights" to various persons including broadcasters. Article 13 of the Rome Convention provided that "[b]roadcasting organisations [were to] enjoy the right to authorise or prohibit", among other things, "the rebroadcasting of their broadcasts", "the fixation of their broadcasts" and "the reproduction ... of fixations, made without their consent, of their broadcasts". the "programmes" of broadcasting authorities, and Conti J noted30 that the Gregory Report had spoken of the right to prevent the copying of the broadcasting systems established by the 1942 Act spoke of the provision of "programmes" broadcast or televised from transmitting stations, and the Spicer Report spoke both of the protection of "broadcasts" and (in par 286) of "the programme received". The Rome Convention, like the Act, used the term 27 (1937) 58 CLR 479 at 496. 28 Australia, House of Representatives, Parliamentary Debates (Hansard), 16 May 29 International Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organisations, Rome, 26 October 1961. This, with some reservations, was acceded to by Australia with effect from 30 September 1992: [1992] Australian Treaty Series No 29. 30 (2001) 108 FCR 235 at 267. McHugh ACJ Gummow Hayne "broadcast". There was no significant step taken with this shift in language. At this time, the use of "broadcast" as a noun indicated31: "a Broadcasting as a medium of transmission. b The material, music, or pictures broadcast; also, a single program of such material". The policy and objective in the recommendations of both Committees was to protect the cost to, and the skill of, broadcasters in producing and transmitting their programmes, in addition to what copyrights may have subsisted in underlying works used in those programmes. There is no indication, as Nine would have it, that, with respect to television broadcasting, the interest for which legislative protection was to be provided was that in each and every image discernible by the viewer of such programmes, so as to place broadcasters in a position of advantage over that of other stakeholders in copyright law, such as the owners of cinematograph films or the owners of the copyrights in underlying original works. The television broadcasting right Part III (ss 31-83) of the Act provides for copyright in original literary, dramatic, musical and artistic works. Part IV (ss 84-113) provides for copyright in subject-matter other than works, namely sound recordings, cinematograph 31 Webster's New International Dictionary, 2nd ed (1958), vol 1 at 339. The Australian Oxford Dictionary, (1999) at 170 distinguishes between uses of "broadcast" as a verb, noun, adjective and past participle; it gives for its meaning as a noun "a radio or television programme or transmission" and as a verb "transmit (programmes or information) by radio or television". The Macquarie Dictionary, 3rd ed (1997) for "broadcast", and beside the sub-classification "Radio", states at "a the broadcasting of radio messages, speeches, etc. b a radio program. c a single period of broadcasting". The Oxford English Dictionary, 2nd ed (1989), vol 2 at 568 cites the statement in the Westminster Gazette, 19 October 1922: "The British Broadcasting Company will broadcast news, information, concerts, lectures, educational matter, speeches, weather reports, and theatrical entertainments." McHugh ACJ Gummow Hayne films, television broadcasts and sound broadcasts, and published editions of works. Of Pt IV copyrights, it is accurately observed32: "In general, these subject matters receive a lower level of protection than works, with shorter terms and more restricted exclusive rights." As indicated above, this case concerns copyright in television broadcasts. Copyright subsisting by virtue of Pt IV is in addition to and, with an immaterial qualification33, is independent of copyright subsisting by virtue of Pt III (s 113(1)). Further, as to Pt IV copyrights, the subsistence of copyright under one provision of Pt IV does not affect the operation of any other provision of Pt IV under which copyright can subsist (s 113(2)). For example, there may be copyrights under Pt IV in a cinematograph film which is the subject of a television broadcast, and the film may utilise the copyrights under Pt III in, for example, original dramatic and musical works. There are various points of contact made in the Act between the copyrights conferred by Pt III in respect of original works and the newer forms of copyright provided for in Pt IV. These contacts were described in the judgment of the majority in Phonographic Performance Co of Australia Ltd v Federation of Australian Commercial Television Stations ("PPCA")34. What is significant for present purposes is that the exclusive rights with respect to original literary, dramatic and musical works include the right to broadcast the works (s 31(1)(a)(iv)) whether by way of sound broadcasting or television (s 25(1)), and the exclusive rights with respect to original artistic works include the right to include the works in television broadcasts (s 31(1)(b)(iii))35. The result is that a 32 Ricketson, The Law of Intellectual Property: Copyright, Designs & Confidential Information, 2nd ed (rev) (2002), §8.0. 33 Any copyright otherwise still subsisting under Pt III is not infringed by the public viewing of a cinematograph film, the copyright in which has expired (s 110(2)). 34 (1998) 195 CLR 158 at 162-163 [3]-[6]. 35 The Amendment Act substituted in pars (b)(iii) and (a)(iv) the right "to communicate the work to the public" and introduced in s 10 a definition of "communicate" as meaning: "make available online or electronically transmit (whether over a path, or a combination of paths, provided by a material substance or otherwise) a work or other subject-matter". McHugh ACJ Gummow Hayne television broadcast may be more than a broadcast of some event or spectacle; it also in some cases may reproduce one or more works in which copyright subsists under Pt III and is vested in a different ownership to that of the broadcast. Copyright subsisted in "a television broadcast" made by Nine from a place in Australia (s 91) and was vested in Nine (s 99), and subsisted for 50 years thereafter (s 95(1)). Section 101 is the primary provision dealing with infringement of Pt IV copyrights. Sub-section (1) states: "Subject to this Act, a copyright subsisting by virtue of this Part is infringed by a person who, not being the owner of the copyright, and without the licence of the owner of the copyright, does in Australia, or authorizes the doing in Australia of, any act comprised in the copyright." The reference to "any act comprised in the copyright" is to be read as a reference to any act that, under the Act, the copyright owner has the exclusive right to do; this includes the exclusive right to authorise a person to do that act (s 13). Sub-sections (3) and (4) of s 101 provide: "(3) Subsection (1) applies in relation to an act done in relation to a sound recording whether the act is done by directly or indirectly making use of a record embodying the recording. Subsection (1) applies in relation to an act done in relation to a television broadcast or a sound broadcast whether the act is done by the reception of the broadcast or by making use of any article or thing in which the visual images and sounds comprised in the broadcast have been embodied." The reference in s 101(4) to "reception" is to reception from the transmission by which the broadcast is made or from a simultaneous transmission made by other means (s 25(2)). The distinction drawn in s 101(4) between infringement by reception and by fixation, using embodiments of the broadcast, reflects the mischief perceived in par 116 of the Gregory Report, and Recommendation 31, which have been set out above at [24]. The acts comprised in the broadcasting copyright are specified in s 87, the text of which will be set out below. Two particular paragraphs of s 87 were in issue in this litigation. The first, s 87(a), specifies as a violation of the exclusive right in the case of the visual images in a television broadcast, the making of a cinematograph film or a copy thereof. The second, s 87(c), specifies the McHugh ACJ Gummow Hayne re-broadcasting of a television broadcast. The Full Court held that Ten was guilty of each species of infringing activity. However, for this appeal there is a necessarily anterior question. It is what is comprehended by the "subject-matter" of the protection under Pt IV given to "a television broadcast". That is the phrase used in ss 91, 95, 99 and 101(4). It should be observed that s 101(4) uses the phrase "the visual images and sounds comprised in the broadcast". Likewise, for the purposes, for example, of fixing the commencement of the 50 year period specified in s 95(1), the television broadcast is treated by s 22(5) as having been made "by the person by whom, at the time when, and from the place from which, the visual images or sounds constituting the broadcast ... were broadcast"36. The decision which Ten challenges appears to discount the force of that phrase, redolent of plurality and interconnection of images and sounds, by treating as "a television broadcast" that which is capable of being observed as a separate image and (in an unexplained fashion) that capable of being heard and distinguished as the accompanying sounds (if any). The medium of communication Where the "subject-matter" of copyright protection is of an incorporeal and transient nature, such as that involved in the technology of broadcasting, it is to be expected that the legislative identification of the monopoly (eg, by s 87) and its infringement (eg, by s 101) of necessity will involve reference to that technology. But that does not mean that the phrase "a television broadcast" comprehends no more than any use, however fleeting, of a medium of communication. Rather, as the Gregory Report indicated, protection was given to that which had the attribute of commercial significance to the broadcaster, identified by the use of the term "a broadcast" in its sense of "a programme". In the same way, the words, figures and symbols which constitute a "literary work", such as a novel, are protected not for their intrinsic character as the means of communication to readers but because of what, taken together, they convey to the comprehension of the reader. In fixing upon that which was capable of perception as a separate image upon a television screen and what were said to be accompanying sounds as the subject-matter comprehended by the phrase "a television broadcast", the Full Court appears to have fixed upon the medium of transmission, not the message conveyed by its use. 36 See also s 25(5). McHugh ACJ Gummow Hayne Because the medium is ephemeral, it is necessary to capture what a television broadcaster transmits if any practical use is to be made of the signal that is broadcast. For many purposes, it is necessary not only to capture the signal, but also to translate it so that the images and sounds which the signal conveys can be seen and heard. The most common method of doing that is, of course, the television set, but other devices, such as various forms of video recorder, may be used. According to the device that is used, what is captured and translated may be only so much of a signal broadcast as has previously been, or can at the time of transmission of the signal be, translated into a single image or moment of sound. But in the ordinary course, what is captured and translated can, and will, be a faithful reproduction of all, or substantially all, that the Section 87 of the Act, in pars (a) and (b), identifies the nature of copyright in a television broadcast by reference to two methods by which what is transmitted can be captured and recorded in permanent or semi-permanent form. One method (s 87(a)) is to take a still visual image of what otherwise appears on a television set as part of a continuous visual transmission. In that context it may be sensible to speak of a single visual image that is broadcast. However, it by no means follows that it is sensible to confine the understanding of "a television broadcast" by basing the meaning that is given to the expression upon the capacity to capture and record singular visual images. Especially is that so when it makes little sense to speak of a single "moment" of sound accompanying that image. The instantaneous fixing of single visual images is familiar, but the instantaneous fixing of single sounds is not. When it is further observed that s 87(c), with its reference to re-broadcasting, at least encompasses the capture and simultaneous retransmission of a television broadcaster's signal, it is apparent that to understand "a television broadcast" as a singular and very small portion of the signal which a broadcaster transmits virtually continuously, and a person receiving is intended to receive continuously, is to give the expression a very artificial meaning. Yet that is what the Full Court did. The reasoning of the Full Court The conclusion of the Full Court with respect to s 87(a) rested largely upon a view taken of the significance of s 25(4). That sub-section treats the reference in s 87(a) to the making of "a cinematograph film" of "a television broadcast" as "including a reference to a cinematograph film ... of any of the visual images comprised in the broadcast". In that regard, Hely J held37 that "the expression 'any of the visual images' encompasses any one or more of those 37 (2002) 118 FCR 417 at 433. McHugh ACJ Gummow Hayne images, without any requirement that the images should amount to a substantial part of the broadcast". His Honour concluded38: "As the videotapes of the Panel Segments made by Ten are cinematograph films of the visual images comprised in the source television broadcasts in terms of s 25(4), it follows that, subject to the fair dealing defences, Nine has established contravention of its s 87(a) copyright in the source broadcasts. That conclusion follows from the application of s 25(4) to the facts, without the need to determine what constitutes a television broadcast. However, that issue has to be confronted in relation to s 87(c)." (emphasis added) However, the primary task had been to identify that television broadcast in which copyright subsisted in Nine under s 91. This was a matter of visual images and sounds and the primary task was not performed, and could not properly be avoided, by reasoning from a provision concerned with fixation in a cinematograph film. As to s 87(c), Hely J observed that in the Act there was no definition of "re-broadcast"39. However, it should be noted that Art 3(g) of the Rome Convention states: the simultaneous broadcasting by one "'[R]ebroadcasting' means broadcasting organisation of the broadcast of another broadcasting organisation." If s 87(c) of the Act be read in the same way, the use by Ten of its previous "fixations" of the Nine programmes would not have contravened s 87(c)40. However, neither side has submitted to this Court that s 87(c) is to be read in the same way as the re-broadcasting right given by the Rome Convention. It might be added that it would be difficult to read Art 3(g) as applying to a simultaneous re-broadcast of one image and accompanying sound. Hely J concluded the consideration of s 87(c) by saying41: 38 (2002) 118 FCR 417 at 435. 39 (2002) 118 FCR 417 at 435. 40 See Stewart, International Copyright and Neighbouring Rights, 2nd ed (1989), 41 (2002) 118 FCR 417 at 435-436. McHugh ACJ Gummow Hayne "When is a television broadcast made? A television broadcast is made when the transmission of visual images and any accompanying sounds begins. A television broadcast continues to be made as the transmission of visual images and any accompanying sounds continues. Visual they are broadcast, themselves satisfy the definition of 'television broadcast'42. One does not have to wait until there has been a transmission of enough of the images and sounds to constitute a programme, or any other subject matter, before concluding that a television broadcast has been made. images and accompanying sounds as I conclude that a television broadcast in which copyright may subsist is made whenever visual images and accompanying sounds are broadcast by way of television. Re-broadcasting of any of the actual images and sounds so broadcast is an infringement of copyright under s 87(c), whether or not the subject matter of the re-broadcast is characterised as a programme, a segment of a programme, an advertisement, a station break or a station logo, or as a substantial part of any of those things. Accordingly, I do not agree, with respect, with the primary judge's conclusion that whether or not there has been 're-broadcasting' of a television broadcast is to be measured against those benchmarks." (emphasis added) The critical step in this reasoning was to identify "a television broadcast" as the broadcast of a singular visual image with accompanying sound. In essence, the reasoning depended upon giving controlling force to s 25(4) in construing and applying the meaning of "a television broadcast". It is not right to give s 25(4) that place. As these reasons seek to show, s 25(4) is explanatory or epexegetical of an aspect of one of the three species of rights with which s 87 is concerned. The expression "a television broadcast" must be understood in a way which is consistent with all of the rights mentioned in s 87. Conti J had favoured the "television broadcaster's program, or respective segments of a program, if a program is susceptible to subdivision by reason of the existence of self-contained themes" and added that "in the case of commercial television, an advertisement should logically be treated in the same way as a 42 cf the observations of Buckley LJ in Spelling Goldberg [Productions Inc v BPC Publishing Ltd [1981] RPC 283] at 296. McHugh ACJ Gummow Hayne separate program"43. However, in the Full Court, Hely J took a contrary view, saying44: "It may be that in the mid-1950s a television broadcast would be seen as consisting of a series of discrete programmes of comparatively short duration. But today there is a continuous television broadcast, although the subject matter of that broadcast may be so arranged as to be of interest to different sections of the public at different times in the day. There may be some spectacles or events, for example, the Gulf War, which might be the subject of a television broadcast continuing for more than a day." Hely J explained the role for principles of substantiality upon his construction of the phrase "a television broadcast" by saying45: "If a broadcast consists of visual images and sounds, but the re-broadcast is of one, rather than the other, or if the re-broadcast is of images which have been cropped, then issues of substantiality may arise." As already emphasised in these reasons, the requirement that an infringer who takes less than the whole of the protected subject-matter must take at least a substantial part thereof plays a well-established and central part in copyright law. Questions of quality (which could include the potency of particular images or sounds, or both, in a broadcast) as well as quantity arise both in respect of Pt IV copyrights and those copyrights in original works to which Pt III applies46. The outcome of the decision of the Full Court now under appeal is that the interests of broadcasters are placed by the Act in a privileged position above that of the owners of copyright in the literary, dramatic, musical and artistic works which may have been utilised in providing the subject of the images and sounds broadcast. This is because the diminished requirements in respect of infringement of television broadcasts for the taking of a substantial part of the subject-matter facilitate the proof of infringement there while leaving the owners 43 (2001) 108 FCR 235 at 272. 44 (2002) 118 FCR 417 at 436. 45 (2002) 118 FCR 417 at 436-437. 46 See Nationwide News Pty Ltd v Copyright Agency Ltd (1996) 65 FCR 399 at 418-419; Newspaper Licensing Agency Ltd v Marks & Spencer plc [2003] 1 AC McHugh ACJ Gummow Hayne of copyrights under Pt III with a heavier burden. Ten points to this apparent incongruity as favouring a construction of the Act contrary to that adopted by the Full Court. Section 87(a) and s 25(4) The construction given by Hely J to s 87(c), the re-broadcasting right, appears to have proceeded from the construction given to the visual "fixation" right conferred by s 87(a). That, in turn, depended upon the construction and significance of s 25(4). Ten emphasises in its submissions on the appeal that the limitation of s 25(4) and s 87(a) to the fixation of the visual element in "a television broadcast" provided no necessary or sufficient support for an interpretation of the re-broadcasting right where no fixation is involved but both image and sound are received and broadcast in infringement of the copyright. Nor, Ten submitted, was the process of construction whereby s 87(a) drove the construction of s 87(c) indicated by his Honour. Those submissions should be accepted. It is convenient then to make further reference to s 25(4). That requires that there first be some examination of the building blocks which the Act supplies in a complex set of definitions and explanatory provisions. The category in Pt IV of copyright in subject-matter other than works falls into four divisions: sound recordings; cinematograph films; television broadcasts and sound broadcasts; and published editions of works. The first three are related. Each is the subject of definitions in s 10 of the Act, as follows: A "sound recording means the aggregate of the sounds embodied in a record" and "record means a disc, tape, paper or other device in which sounds are embodied". The term "embodied" reflects the introduction into some of the Pt IV subject-matter of the "fixation" principle of copyright law that copyright does not subsist in a work unless and until the work takes some material form, so that protection does not extend to the ideas or information contained in the work and a balance is struck between the interests of authors and those of society in free and open communication47. This notion of "fixation" receives further explanation in s 24. This states: 47 Copinger and Skone James on Copyright, 14th ed (1999), vol 1, §3.74. See also Campomar Sociedad, Limitada v Nike International Ltd (2000) 202 CLR 45 at 67 [45]-[46]; Théberge v Galerie d'Art du Petit Champlain Inc [2002] 2 SCR 336 at 353-354, 397-398; Loughlan, "Copyright Law, Free Speech and Self-Fulfilment", (2002) 24 Sydney Law Review 427 at 428-431. McHugh ACJ Gummow Hayne "For the purposes of this Act, sounds or visual images shall be taken to have been embodied in an article or thing if the article or thing has been so treated in relation to those sounds or visual images that those sounds or visual images are capable, with or without the aid of some other device, of being reproduced from the article or thing." Further, s 23(1) marks off the definition of sound recording from that of "cinematograph film" by providing: "For the purposes of this Act, sounds embodied in a sound-track associated with visual images forming part of [a] cinematograph film shall be deemed not to be a sound recording." This Court held in PPCA48 that (i) the operation of s 23(1) was to deny any separate copyright as a sound recording to the sounds embodied in the soundtrack which forms part of a cinematograph film, but (ii) it did not follow that, when a film, with its soundtrack, was broadcast, there was no infringement of copyright in earlier sound recordings (in PPCA, of various songs) which had been reproduced in that soundtrack. (ii) A "cinematograph film means the aggregate of the visual images embodied in an article or thing so as to be capable by the use of that article or thing: of being shown as a moving picture; or of being embodied in another article or thing by the use of which it can be so shown; and includes the aggregate of the sounds embodied in a sound-track with such visual images". Again, s 24 operates to explain the use of "embodied". It will be observed that what is protected is not merely an aggregation of visual images, but an aggregation capable of "being shown as a moving picture"; that expression is not defined. (iii) References to "broadcasting", subject to the appearance of a contrary intention, are to be read as references to "broadcasting whether by way of 48 (1998) 195 CLR 158. McHugh ACJ Gummow Hayne sound broadcasting or of television" (s 25(1)); and "broadcast means transmit by wireless telegraphy to the public". In turn, "wireless telegraphy means the emitting or receiving, otherwise than over a path that is provided by a material substance, of electromagnetic energy". (iv) The phrase "sound broadcast means sounds broadcast otherwise than as part of a television broadcast"; the phrase "television broadcast means visual images broadcast by way of television, together with any sounds broadcast for reception along with those images", so that the phrase "television broadcast" has visual and auditory elements but only the former need be present for the definition to apply. The definitions of "sound recording" and "cinematograph film" are drafted so as to avoid overlapping. But both definitions differ in a significant respect from those of "television broadcast" and "sound broadcast". The former turn upon the notion of "fixation" and the existence of a material embodiment, as explained by s 24. The latter do not. Rather, as foreshadowed in par 284 of the Spicer Report, set out in these reasons at [26], they turn upon the activity of broadcasting to the public by wireless telegraphy and by way of television. Further, television broadcasting involves the two elements of visual images and sound. These distinctions between the incorporeal and the corporeal, and between the sound and visual elements of television broadcasting, are vital to an understanding of the relationship between ss 85 and 86 on the one hand and s 87 on the other. Sections 85 and 86 identify the exclusive rights conferred by copyrights in sound recordings (s 85) and cinematograph films (s 86). One of the former is "to make a copy of the sound recording" (s 85(1)(a)); one of the latter is "to make a copy of the film" (s 86(a)). Each category of infringing act in these categories will involve copying to produce a material embodiment where there was an anterior material embodiment. Television and sound broadcasts do not have that character. The reception of a broadcast by "pulling it down" may itself be sufficient (as s 101(4) recognises) for infringement by re-broadcasting (s 87(c)). However, in drafting the Act, some care was needed in identifying the translation of the incorporeal into a fixed form if that translation were to be treated as an infringing act. That was done by pars (a) and (b) of s 87. Section 87 states: "For the purposes of this Act, unless the contrary intention appears, copyright, in relation to a television broadcast or sound broadcast, is the exclusive right: McHugh ACJ Gummow Hayne in the case of a television broadcast in so far as it consists of visual images – to make a cinematograph film of the broadcast, or a copy of such a film; in the case of a sound broadcast, or of a television broadcast in so far as it consists of sounds – to make a sound recording of the broadcast, or a copy of such a sound recording; and in the case of a television broadcast or of a sound broadcast – to re-broadcast it." Section 25(4) is epexegetical or explanatory of par (a) of s 87, providing the following detail: "In this Act: a reference to a cinematograph film of a television broadcast shall be read as including a reference to a cinematograph film, or a photograph, of any of the visual images comprised in the broadcast; and a reference to a copy of a cinematograph film of a television broadcast shall be read as including a reference to a copy of a cinematograph film, or a reproduction of a photograph, of any of those images." Where, as in the present case, both visual images and the sounds of a television broadcast are captured on video tape, s 87 identifies the exclusive right of the broadcaster in a striking fashion. It distinguishes between the capture of the visual images (s 87(a)) and the recording of the sounds (s 87(b)). In each case, the exclusive right in respect of the ephemeral activity of broadcasting is identified by reference to fixed embodiments. At first blush, it may have been more straightforward for the statute to have settled in s 87(a) solely upon the making of "a cinematograph film" of the television broadcast as the relevant exclusive entitlement of the broadcaster. But to do so would have given rise to textual difficulty. If s 87(a) had referred, in its closing phrases and without more, to the making of a cinematograph film of the broadcast, that would have made a nonsense of the opening words of s 87(a). These take as the subject-matter of the cinematograph film only so much of the broadcast as consisted of visual images. But the definition in s 10 of "cinematograph film", set out above, takes two aggregates, that of the visual images and that of the sounds, each as found in a distinct fixed embodiment. McHugh ACJ Gummow Hayne That definition of "cinematograph film" is subjected by s 10 to the presence of a contrary intention. That is found in s 25(4) which takes the composite expression "a cinematograph film of a television broadcast" and permits its limitation to a peculiar cinematograph film, one limited to visual images comprised in the television broadcast. In this way, there is effectuated the drafting method adopted in s 87 to deal with sound broadcasts and the sound element of television broadcasts together (in par (b)), and separately (in par (a)), with the visual element of television broadcasts. But it should be noted that there is not removed from the necessary character of the "cinematograph film" spoken of in par (a) the definitional requirement that the aggregate of visual images be capable, by use of the material embodiment, "of being shown as a moving picture". Section 25(4) and "substantial part" Section 25(4) does not answer the next question which may arise, namely, whether this cinematograph film represents a substantial part of the images comprising the television broadcast in question. Paragraph (a) of s 14(1) requires references to the doing of infringing acts to be read as including references to infringing acts in relation to a "substantial part" of Pt IV subject-matter, in this case, television broadcasts. Section 14, like s 25, is contained in Pt II (ss 10-30A), which is headed "Interpretation". Section 14 does not affect the references in other provisions of the Act (ss 32, 177, 180, 187 and 198) to the publication of a work or to the absence of publication of a work. Sub-section (2) of s 14 so states. It should be noted here that, to a significant degree, questions of the subsistence and duration of copyright turn upon the classification of works as published or unpublished. Section 14(1) is expressed to be subject to the appearance of a contrary intention. The immediately following s 14(2) is a detailed instance of this. Another is This states that s 14 does not apply in determining whether reproductions of a work or an edition of a work have been supplied to the public and are therefore to be classified as published works. Section 25(4) does not display a contrary intention to displace the operation of s 14. In particular, s 25(4) does not further favour the interests of broadcasters by decreasing the burden they carry in establishing infringement of television broadcasting copyright below the requirement of a taking of a substantial part of the subject-matter. Rather, s 25(4) gives a special meaning to the term "a cinematograph film of the broadcast" in s 87(a), but leaves outstanding the issue whether there has been taken at least a substantial part of the images aggregated in the television broadcast in question. In this way, effect McHugh ACJ Gummow Hayne is given to each provision, while maintaining the unity of the statute in the sense discussed in Project Blue Sky Inc v Australian Broadcasting Authority49. Additional matters of construction of s 25(4) Four points should be made here in support of the above reading of s 25(4). First, as observed earlier in these reasons, it would be a curious method of construction of the Act to take s 25(4) as flowing upstream and as dictating the content of the phrase "a television broadcast". Secondly, s 25(4) is not addressed to that part of the "fixation" right in s 87 which is concerned with sound. In so far as "a television broadcast" consists of sounds, the relevant provision is in par (b) not par (a). It would make little sense and not meet the definition of "sound recording" to speak of a recording of that minimal auditory experience which could be treated as accompanying that single image to provide what Nine contends together constitutes "a television broadcast". Thirdly, s 25(4) can have no application, given its terms, to that exclusive right conferred by s 87(c), ie, that to re-broadcast the television broadcast in question. It would be an odd result if the requirement of at least a substantial taking applied to s 87(c) but not to s 87(a). That suggests s 25(4) operates in the fashion explained in these reasons. Fourthly, there is the significance of the presence in the infringement provision in s 101(4) of the phrase "the visual images and sounds comprised in the broadcast" and the reference in s 135B to the making of a copy of the whole or a part of a "transmission" (being a sound broadcast or a television broadcast). Part VA (ss 135A-135ZA) deals with the copying of "transmissions" by educational and other institutions. The term "transmission" is defined in s 135A so as to include "a sound broadcast or a television broadcast". Section 135B then states: "In this Part: a reference to a copy of a transmission is a reference to a record embodying a sound recording of the transmission or a copy of a cinematograph film of the transmission; and a reference to the making of a copy of a transmission is a reference to the making of a copy of the whole or a part of the transmission." (emphasis added) No contrary view of the operation of s 25(4) is required by the treatment of photography as the making of "a cinematograph film of a television 49 (1998) 194 CLR 355 at 381-382 [69]-[70]. McHugh ACJ Gummow Hayne The Act otherwise distinguishes between photography and broadcast". cinematography. A photograph is an artistic work by reason of its inclusion in par (a) of the definition of "artistic work" in s 10. Thus, a photograph may be an original artistic work to which Pt III of the Act applies. But "photograph" is so defined in s 10 as to place cinematography elsewhere, namely in Pt IV, with other original works of authorship. In that regard, Judge Learned Hand observed50: "no photograph, however simple, can be unaffected by the personal influence of the author, and no two will be absolutely alike". The definition states: "photograph means a product of photography or of a process similar to photography, other than an article or thing in which visual images forming part of a cinematograph film have been embodied, and includes a product of xerography, and photographic has a corresponding meaning". The effect of s 25(4) is to qualify that disjunction between photography and cinematography. This is achieved in s 25(4) by treating the photographing of visual images in a television broadcast as the making of a cinematograph film of the broadcast, for the purposes of s 87(a). Whether one or more photographs infringe the television broadcast copyright will depend upon the operation of the substantiality provision in par (a) of s 14(1) of the Act. There remains the question of identifying that to which par (a) of s 14(1) speaks in its application to "a television broadcast" spoken of in pars (a) and (c) of s 87. What does that phrase identify in the present case? What is "a television broadcast"? The definition given in s 10 is "television broadcast", which is drawn in terms of the technology of broadcasting which is to be utilised. But the phrase in the exclusive right provisions of s 87 (as also in ss 91, 95, 99 and 101(4)) is "a television broadcast" (emphasis added). 50 Jeweler's Circular Pub Co v Keystone Pub Co 274 F 932 at 934 (1921); affd 281 F McHugh ACJ Gummow Hayne In the present case, Hely J focused attention not upon the statutory phrase "a television broadcast", but upon the use of technical language in the definition of "television broadcast". His Honour concluded51: "Here the interest protected by the copyright is the visual images broadcast by way of television and any accompanying sounds. It is the actual images and sounds broadcast which constitute the interest protected. The interest protected is not defined in terms of some larger 'whole' of which the visual images and sounds broadcast are but a part. The ephemeral nature of a broadcast, and the fact that copyright protection is conferred by reference to a broadcaster's output, rather than by reference to the originality of what is broadcast, may also help to explain why the interest protected is defined in this way." That identification of the interest sought to be protected by the broadcast copyright should not be accepted. The interest sought to be protected by the conferral of the television broadcast copyright was identified by the Spicer Committee with reference to the experience of the BBC and the Independent Television Authority. The latter was established by the Television Act 1954 (UK) and charged by s 3 to "broadcast ... programmes" of a certain standard. This interest was identified as that in the cost and skill in assembling or preparing and transmitting programmes to the public. That activity of public broadcasting occurred in exercise of statutory authority which required the transmission of programmes of a certain standard or quality identified by their content. The Spicer Committee decided against leaving it to broadcasters to record or film their broadcasts and so depend upon the protection given to sound recordings and cinematograph films (par 287). Further reference should be made to s 91. This limits the identity of those in whom there may subsist copyright in television broadcasts and sound broadcasts. It is sufficient for present purposes to set out pars (a) and (b) of s 91. These state: "Subject to this Act, copyright subsists: in a television broadcast made from a place in Australia by: the Australian Broadcasting Corporation; the Special Broadcasting Service Corporation; or 51 (2002) 118 FCR 417 at 436. McHugh ACJ Gummow Hayne (iii) any prescribed person, being a person who is, at the time when the broadcast is made, authorised under a licence issued under the Radiocommunications Act 1992; and in a television broadcast (other than a broadcast transmitted for a fee payable to the person who made the broadcast) made from a place in Australia under the authority of: a licence allocated by the Australian Broadcasting Authority under the Broadcasting Services Act 1992; a class licence determined by that Authority under that Act". The result is to render the subsistence of copyright dependent upon the making of "a television broadcast" by the Australian Broadcasting Corporation ("the Corporation"), the Special Broadcasting Service Corporation ("the SBS") and those such as Nine and Ten holding the requisite licences or permits under the Broadcasting Act52. What then is contemplated is the exercise by those identified broadcasters of the performance of their statutory powers or duties under their constituent legislation or the exercise of the authority given by their licences under the Broadcasting Act. Under the present legislation, s 14 of the Broadcasting Act defines as "commercial broadcasting services"53 those: "broadcasting services: that provide programs that, when considered in the context of the service being provided, appear to be intended to appeal to the general public; and 52 The only prescriptions under s 91(a)(iii) were of Satellite Leisure Services Pty Ltd and Sky Channel Pty Ltd by Reg 17A of the Copyright Regulations, now repealed by the Copyright Amendment Regulations 2001 (No 2), Sched 1, Item 3. 53 The Broadcasting Act also provides for and defines "community broadcasting services" (s 15), "subscription broadcasting services" (s 16), "subscription narrowcasting services" (s 17) and "open narrowcasting services" (s 18), but in terms which in each case provide for the provision of "programs". McHugh ACJ Gummow Hayne that provide programs that: are able to be received by commonly available equipment; and are made available free to the general public; and that are usually funded by advertising revenue; and that are operated for profit or as part of a profit-making enterprise; and that comply with any determinations or clarifications under section 19 in relation to commercial broadcasting services". (emphasis added) The term "program" means (s 6(1)): "(a) matter the primary purpose of which is to entertain, to educate or to inform an audience; or advertising or sponsorship matter, whether or not of a commercial kind". The inclusion of par (b) should be noted. The Australian Broadcasting Corporation Act 1983 (Cth) specifies the functions of the Corporation in s 6. In particular, par (a) of s 6(1) states as a function of the Corporation: "to provide within Australia innovative and comprehensive broadcasting services of a high standard as part of the Australian broadcasting system consisting of national, commercial and public sectors and, without limiting the generality of the foregoing, to provide: broadcasting programs that contribute to a sense of national identity and inform and entertain, and reflect the cultural diversity of, the Australian community; and broadcasting programs of an educational nature". (emphasis added) The phrase "broadcasting service" is defined in s 3 as meaning a service that delivers "programs" to persons having certain reception equipment, and "program" means "a radio program or a television program". McHugh ACJ Gummow Hayne The Special Broadcasting Service Act 1991 (Cth) states in s 6(1): "The principal function of the SBS is to provide multilingual and multicultural radio and television services that inform, educate and entertain all Australians, and, in doing so, reflect Australia's multicultural society." The SBS is also empowered by s 44(1)(a): "to produce, promote or present programs or arrange, or provide facilities, for the production, promotion or presentation of programs". There can be no absolute precision as to what in any of an infinite possibility of circumstances will constitute "a television broadcast". However, the programmes which Nine identified in pars 5.1-5.11 of its pleading as the Nine Programs, and which are listed with their dates of broadcast in the reasons of Conti J54, answer that description. These broadcasts were put out to the public, the object of the activity of broadcasting, as discrete periods of broadcasting identified and promoted by a title, such as The Today Show, Nightline, Wide World of Sports, and the like, which would attract the attention of the public. However, Conti J was, with respect, correct in adding, with reference to Copinger and Skone James on Copyright55, that56: "Television advertisements should be treated as discrete television broadcasts, particularly since 'A television or cinema commercial is typically the product of the creative and administrative work of many separate individuals' ... I would reject Ten's submission that because advertising is the 'life blood' of commercial television broadcasting, it is 'impossible for [Nine] to avoid the conclusion that these advertisements are part of that program'." 54 (2001) 108 FCR 235 at 240. 55 14th ed (1999), vol 1, §27.341. 56 (2001) 108 FCR 235 at 270. McHugh ACJ Gummow Hayne His Honour added57: "Moreover, where a given program divides into segments, it may be legitimate in the facts of a given case to use a segment of a program for measurement of the television broadcast, rather than the whole of the program." We would reserve consideration of that proposition for a particular case where the point arises. However, the circumstance that a prime time news broadcast includes various segments, items or "stories" does not necessarily render each of these "a television broadcast" in which copyright subsists under s 91 of the Act. The United States law Reference was made in argument to the position under The Copyright Act of 1976 ("the US Act") and something should be said to indicate that this system is at odds with the "single image" interpretation of the Australian legislation. Under the US Act, copyright protection subsists in original works of authorship including "audiovisual works" which are "fixed in any tangible medium of expression, now known or later developed, from which they can be perceived, reproduced, or otherwise communicated, either directly or with the aid of a machine or device" (s 102(a)). The situation is said to be58: "Because is common practice for radio and television broadcasters to simultaneously record live broadcasts, this extension of the concept of fixation would seem to effectively protect virtually all broadcasts." However, "audiovisual works" are defined in s 101 as: "works that consist of a series of related images which are intrinsically intended to be shown by the use of machines or devices such as projectors, viewers, or electronic equipment, together with accompanying sounds, if any, regardless of the nature of the material objects, such as films or tapes, in which the works are embodied". (emphasis added) 57 (2001) 108 FCR 235 at 270. 58 Nimmer on Copyright, (2003), §2.03[B][2]. See further §1.08[C][2] and Production Contractors Inc v WGN Confidential Broadcasting Co 622 F Supp McHugh ACJ Gummow Hayne Conclusions The appeal should be allowed with costs. However, there remains for consideration by the Full Court the determination of so much of Nine's appeal to that Court as turns upon the challenge to the treatment by the primary judge of the issues of substantiality under s 14(1)(a) of the Act. There also remains the question of what orders the Full Court should make in place of those entered on 19 July 2002 in the light both of the reasons of this Court and of the Full Court's consideration of the appeal to that Court. The orders entered on 19 July 2002 should be set aside and the matter be remitted to the Full Court for determination of the remaining grounds of appeal to that Court and for the making of appropriate orders to dispose of that appeal. The costs of all the proceedings in the Full Court should be for that Court. Kirby KIRBY J. In this appeal, there is a division of opinion in the Court concerning the extent of copyright protection of a television broadcast within Pt IV of the Copyright Act 1968 (Cth) ("the Act"). As explained elsewhere, the case concerns the Act in the form in which it appeared before amendments introduced by the Copyright Amendment (Digital Agenda) Act 2000 (Cth). The enactment of copyright protection in a television broadcast is a relatively recent development. It was provided in the United Kingdom in 195659 following a 1952 report of the Gregory Committee60. In Australia, legislation to introduce such protection, substantially copying the United Kingdom Act, was first enacted in 196861. A difference over copyright infringement The point over which this Court has divided concerns a question of statutory construction. That point was first exposed in a difference of opinion between the primary judge in the Federal Court of Australia (Conti J)62 and the Full Court of that Court63. The latter reversed the primary judge's orders. Upon the matter in issue, I agree in the conclusion reached by Callinan J. In my view, the approach adopted by the Full Court was correct. The reasoning of Hely J in the Full Court is compelling. Sundberg J agreed with it64. So, substantially, did Finkelstein J65. So do I. The foundation for the difference between the competing judicial opinions is a conclusion, expressed by the Full Court, and repeated by Callinan J, that the contrary result involves distorting, if not ignoring, the language of the Act. That language must be given effect because it has the special legitimacy of the written law endorsed by the Parliament within a head of power granted by the 59 Copyright Act 1956 (UK). 60 United Kingdom, Report of the Copyright Committee, (1952), Cmd 8662. 61 The Act, s 87 ("Nature of copyright in television broadcasts and sound broadcasts"). 62 TCN Channel Nine v Network Ten (2001) 108 FCR 235. 63 TCN Channel Nine Pty Ltd v Network Ten Pty Ltd (2002) 118 FCR 417. 64 TCN Channel Nine Pty Ltd v Network Ten Pty Ltd (2002) 118 FCR 417 at 419 [1]. 65 TCN Channel Nine Pty Ltd v Network Ten Pty Ltd (2002) 118 FCR 417 at 422 [15]. Kirby Constitution66. The judicial function demands obedience to the provisions of valid enacted law67. Upon the clear language of s 87(a) of the Act, the appellant (which never denied copying the respondents' television broadcasts) infringed that provision. It was common ground that the videotapes made by the appellant, including the segments used in The Panel programme later broadcast by the appellant, were cinematograph films, as defined68. Similarly, upon the clear language of s 87(c) of the Act, the appellant infringed copyright under that provision. It would require an artificially narrow construction of the phrase "a television broadcast" in par (c) of s 87 of the Act to hold that the appellant's undoubted broadcast of excerpts, extracted from the copies it had made of the respondents' broadcasts, did not constitute a "re-broadcast[ing]" of "a television broadcast". Given the terms of the Act, and the purpose of the Parliament in introducing copyright protection in the case of "a television broadcast", it would be surprising indeed if the only infringement for which the Act provided was constituted by a rebroadcast of an entire television "programme" or of some particular segment of such a programme to an extent yet to be specified with acceptable precision. The language of the Act, set out and explained in the reasons of Callinan J, indicates why this interpretation is wrong. It should not be accepted. Purposive construction within textual limits In some respects, this appeal presents, in a different context, a problem about the meaning of the Act similar to that which this Court faced in Phonographic Performance Co of Australia Ltd v Federation of Australian Commercial Television Stations69. the incorporation of sounds, from a sound recording, in the sound-track of a cinematograph film, resulted in a broadcast of the sound recording when the film was subsequently broadcast. There too this Court divided. The majority70 held issue was whether There, the 66 Constitution, s 51(xviii). 67 See Trust Company of Australia Ltd v Commissioner of State Revenue (2003) 77 ALJR 1019 at 1029 [68]; 197 ALR 297 at 310. 68 cf Galaxy Electronics Pty Ltd v Sega Enterprises Ltd (1997) 75 FCR 8; Aristocrat Leisure Industries Pty Ltd v Pacific Gaming Pty Ltd (2000) 105 FCR 153 at 167- 69 (1998) 195 CLR 158. 70 Phonographic Performance Co of Australia Ltd v Federation of Australian Commercial Television Stations (1998) 195 CLR 158 at 172 [34] per Gaudron, Kirby that there was a broadcast of the sound recordings when the cinematograph film, including the sound recordings incorporated in the sound-track, was broadcast. McHugh J and I dissented upon the view that we took of the provisions of s 23(1) of the Act expressly deeming "sounds embodied in a sound-track associated with visual images … not to be a sound recording"71. On the point in issue in that appeal, the decision of the majority states the law. However, the same problem of interpretation, and many of the same considerations, arise for the interpretation of the provisions of the Act in issue in this appeal. I accept wholeheartedly that the contemporary approach of this Court to the interpretation of contested statutory language is the purposive approach72. However, adopting that approach does not justify judicial neglect of the language of the statute, whether in preference for historical or other materials, perceived legal policy or any other reason73. A purposive construction is supported by s 15AA of the Acts Interpretation Act 1901 (Cth). But that section also does not permit a court to ignore the words of the Act. Ultimately, in every case, statutory construction is a text-based activity74. It cannot be otherwise. In the present case, in the terms of the Act, I find it impossible to construe "a television broadcast" as mentioned in ss 25 and 87 of the Act to exclude those "visual images broadcast by way of television, together with any sounds broadcast for reception along with those images"75 of the kind described in the evidence, being the segments from the respondents' earlier television broadcasts recorded by the appellant and rebroadcast as part of its own programme, The Panel. Similarly, I find it impossible to read the plain language of s 101(1) and (4) of the Act somehow to confine the meaning of "a television broadcast", so that it does not include segments of the type recorded and then rebroadcast by the appellant. 71 Phonographic Performance Co of Australia Ltd v Federation of Australian Commercial Television Stations (1998) 195 CLR 158 at 174-175 [42], reasons of McHugh J and myself; cf Kelly v The Queen [2004] HCA 12, reasons of McHugh J and myself. 72 Bropho v Western Australia (1990) 171 CLR 1 at 20 approving Kingston v Keprose Pty Ltd (1987) 11 NSWLR 404 at 421-424. See eg Attorney-General (WA) v Marquet (2003) 78 ALJR 105 at 130 [143]; 202 ALR 233 at 267. 73 See eg Trust Company of Australia Ltd v Commissioner of State Revenue (2003) 77 ALJR 1019 at 1029 [68]; 197 ALR 297 at 310. 74 Trust Company of Australia Ltd v Commissioner of State Revenue (2003) 77 ALJR 1019 at 1029 [68]; 197 ALR 297 at 310. 75 The Act, s 10(1). Kirby If one is truly looking for the "purpose" of the Act, that purpose must be found not in some a priori view about the merits, or desirability, of the copyright in their television broadcasts which the respondents assert. Ultimately, that purpose must be found in the command of the Parliament, expressed in the Act. Moreover, because, following detailed official inquiries76 and the development of an international Convention77, the Act afforded new and larger copyright entitlements in Australia, it would be contrary to basic principle and the ordinary canons of statutory construction to restrict those entitlements in a way that conflicted with the language of the Act or that unduly narrowed its operation. Normally, an amendment of an Act to provide new rights of such a kind will be given a beneficial construction so as to ensure that the purpose of the legislature is truly attained78. I accept that in the context of the law of copyright, indeed intellectual property law generally, other considerations compete with the protection of private rights79. But in the end, it is the statutory text, not generalities or judicial policy judgments, that governs the task in hand and is determinative80. Criticisms of the ambit of copyright protection I reach my conclusion without quite the same enthusiasm as Callinan J appears to feel for it. The opinion of the Full Court has been described as "highly literal"81. Perhaps it is; but the language of the Act leaves no scope for another 76 United Kingdom, Report of the Copyright Committee, (1952), Cmd 8662. 77 International Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organisations, done at Rome on 26 October 1961, 1992 Australia Treaty Series 29, entered into force for Australia on 30 September 1992. See Phonographic Performance Co of Australia Ltd v Federation of Australian Commercial Television Stations (1998) 195 CLR 158 at 178-179 [48]- 78 cf Sega Enterprises Ltd v Galaxy Electronics Pty Ltd (1996) 69 FCR 268 at 273- 274. The need also to adapt the Act to changing technology was emphasised in that decision. 79 cf Grain Pool of Western Australia v Commonwealth (2000) 202 CLR 479 at 530- 80 Phonographic Performance Co of Australia Ltd v Federation of Australian Commercial Television Stations (1998) 195 CLR 158 at 172 [34]. 81 Handler, "The Panel Case and Television Broadcast Copyright", (2003) 25 Sydney Law Review 391 at 394. Kirby approach. The most telling criticism voiced of the Full Court's interpretation is that it makes television broadcast copyright "an extraordinarily strong right, easily the strongest of all copyrights in Australia, able to be infringed by taking less than a substantial part of the broadcast"82. This, it is said, is counterintuitive given the ephemeral nature of television broadcasts and the original reasons for granting copyright in them. If I were free of the constraints of the language of the Act, I would be happy to agree in the conclusion reached in this Court by McHugh ACJ, Gummow and Hayne JJ, whilst feeling anxiety about the lack of precision as to what, in any of an infinite range of circumstances, will constitute "a television broadcast" on that view83. I also have some sympathy for the opinion expressed by Ms de Zwart in a comment upon the Full Court's opinion in these proceedings84: "There are … many circumstances in which the public interest lies in permitting the use of a work without the permission of the owner of copyright, with or without payment. The Panel decision provides a good example of circumstances in which a licence would not be granted (between competitors). … It is vital to recognise the public interest element of copyright … Copyright is not solely concerned with economic returns for the owner. Neither was copyright intended to enable owners to exploit all possible uses and derivations of the work. The public domain is an important legacy of copyright law and its existence should also be protected in the face of the growth of digital capture and licensing of works. … The Panel serves as a vehicle for social comment and criticism, albeit in a relaxed, humorous fashion. … Copyright is a social as well as a commercial construct and its role in facilitating new creations as well as protecting existing creations should not be forgotten." 82 Handler, "The Panel Case and Television Broadcast Copyright", (2003) 25 Sydney Law Review 391 at 395. 83 Handler, "The Panel Case and Television Broadcast Copyright", (2003) 25 Sydney Law Review 391 at 394-395. 84 de Zwart, "Seriously entertaining: The Panel and the future of fair dealing", (2003) 8 Media & Arts Law Review 1 at 16-17. Kirby A further comment of this author appears consonant with the evidence and with my own impression, based on that evidence85: "The Panel is an irreverent program that seeks to critique the foibles of the television medium. It provides an important forum to review the broadcast programs of the preceding week. It may not itself be free of the constraints of commercialism, but if the right of fair dealing is not available to permit it to demonstrate the points it is making the message is weakened." Textual difficulties with the propounded limitation It is in this final observation by Ms de Zwart that the clue is provided as to the correct application of the Act in respect of television broadcasts, in the terms in which the Parliament gave expression to its purpose. The Act contemplated a form of copyright apt to the particular technology involved in television broadcasting. It therefore provided that copyright would attach to "the visual images comprised in the broadcast"86. Those who conceive the Parliament as confining the scope of the new copyright protection for television broadcasts to entire programmes (or defined and undefined sections and segments of a continuous day's broadcasting) must not watch much television. It is the very power of particular, and often quite limited (even fragmentary) portions of "visual images" on television that makes it such a potent and commercially valuable means of expressing thoughts and ideas: noble and banal, serious and humorous, uplifting and discouraging. Everyone knows that still images or very brief segments in television broadcasts can constitute commercially valuable commodities, standing alone. The acquisition by a broadcaster of comparatively short filmed sequences will sometimes represent very important and commercially valuable rights that exist without the need of a surrounding context, let alone an extended programme or particular segment of a day's broadcast. The parties to the present appeal were in commercial competition with each other. That fact is itself also a consideration that generally favours the claim of a copyright owner87. The appellant relied on s 25(4)(a) of the Act in construing s 87(a). It said that the interpretation of that paragraph that it favoured conformed to the purpose 85 de Zwart, "Seriously entertaining: The Panel and the future of fair dealing", (2003) 8 Media & Arts Law Review 1 at 17. 86 The Act, s 25(4)(a). 87 Bently, "Sampling and Copyright: is the Law on the Right Track? – II", (1989) Journal of Business Law 405 at 406. Kirby of the Parliament as illustrated by the Spicer Report88. In my view, the Full Court was right to reject the notion that the "visual images" protected by s 25(4)(a) were only so protected if they constituted a "substantial" part of "a television broadcast". Where does this gloss on the Act come from? Such an approach is inconsistent with the terms of the Act. The Act refers to "any of the visual images"89, making it clear that any one or more of those images is in the sights of the statute. There is thus no textual foundation for the importation of the notion of "a substantial part". Moreover, as Hely J pointed out in the Full Court90, the very fact that, by s 25(4), the Act provides for copyright protection for a photograph of any visual images comprised in a television broadcast, contradicts any threshold requirement of substantiality, inherent in nothing more than the word "broadcast". The suggested limitation upon the notion of infringement provided by the Act is therefore unsustained by a conventional analysis of the statutory language. Both Professor Ricketson and Mr Lahore in their texts91 express the opinion that the taking of a single photograph of any image contained in a television broadcast will fall within the protection provided by the Act to the copyright owner of the broadcast. Their opinions confirm my own approach. I agree with the view expressed by Hely J92: "[T]here may be many collocations of visual images and accompanying sounds broadcast during the space of a day all of which satisfy the definition of a 'television broadcast'. Thus, for example, the first minute of transmission may be a television broadcast as much as the first five minutes. If there is a re-broadcasting of the first minute by one competitor and of the first five minutes by another, then each has infringed the initial 88 Australia, Report of the Committee Appointed by the Attorney-General of the Commonwealth to Consider what Alterations are Desirable in the Copyright Law of the Commonwealth, (1959), par 295. The history is explained in EMI Music Australia Pty Ltd v Federation of Australian Commercial Television Stations (1997) 74 FCR 485 at 491-494 per Lockhart J. 89 The Act, s 25(4)(a). 90 TCN Channel Nine Pty Ltd v Network Ten Pty Ltd (2002) 118 FCR 417 at 432 [60]. 91 Ricketson, The Law of Intellectual Property: Copyright, Designs & Confidential Information, (2002) at [8.100], [9.520]; Lahore and Rothnie, Copyright and Designs, (2003) at [34,075]. 92 TCN Channel Nine Pty Ltd v Network Ten Pty Ltd (2002) 118 FCR 417 at 436 Kirby broadcaster's copyright in a television broadcast which is of one minute's duration in the first case, and of five minutes duration in the second. The fact that there may be thousands of transmissions in any day which are a television broadcast as defined does not lead to any inconvenience or absurdity given that copyright protection is confined to the actual images and accompanying sounds broadcast." The proper approach to the meaning of the Act It follows that the Parliament did not envisage the striking of a balance between public and private interests in the Act by the adoption of an unspecified and ultimately undefinable notion of "a television broadcast" in the sense of a "unit of programming". The Act does not refer to that notion of a "programme" or unit thereof93. It might have done so. But it did not. Instead, the Act provides for copyright to attach to "a television broadcast" that necessarily contains, of its nature, parts of such a programme, including therefore long as well as very short extracts. To strike an acceptable balance between public and private interests, the Parliament looked elsewhere. By s 14(1) it provided, in effect, for a permissible degree of exploitation by introducing the notion that the proscribed act must be in relation to "a substantial part" of the work or subject matter. And if that barrier is passed the defence of fair dealing may be invoked, precisely as the appellant claimed in this case. I would endorse what Finkelstein J said on this point94: "There are exceptions to the monopoly rights given to copyright owners. Fair dealing is one of those exceptions. The Copyright Act confers a privilege on third parties to use copyright material without the consent of the owner in certain circumstances. The doctrine developed to resolve the tension between, on the one hand, the monopoly granted to the owner and, on the other hand, the public interest." The text of "substantial part" under the Act imports criteria of "fact and degree"95. Commonly, it is bound up with notions of originality. It has been applied restrictively as little more than a de minimis threshold. What is a 93 Handler, "The Panel Case and Television Broadcast Copyright", (2003) 25 Sydney Law Review 391 at 400 citing Data Access Corporation v Powerflex Services Pty Ltd (1999) 202 CLR 1 at 27. 94 TCN Channel Nine Pty Ltd v Network Ten Pty Ltd (2002) 118 FCR 417 at 420 [7]. 95 Ladbroke (Football) Ltd v William Hill (Football) Ltd [1964] 1 WLR 273 at 283, 287-288; [1964] 1 All ER 465 at 473-474, 477. Kirby "substantial part" of a television broadcast will not necessarily represent a segment of long duration. The image of a winning ball or a goal in a sporting final; the sight of a catastrophe captured on film by a television crew that arrived there first; the image of events of global significance akin to the collapse of the World Trade Center in New York in 2001 or the crash of the Concorde airliner, all illustrate the impossibility of thinking in such purely quantitative terms in the context of this medium. The proposition that the excerpts broadcast by the appellant were of comparatively brief duration and that this indicates somehow that the parts copied by the appellant were "not substantial"96 overlooks the terms of the Act and the basic nature of television broadcasting in which minutes or seconds, visually captured, especially with sound and images, may tell a thousand stories which the print media or other forms of human communication cannot precisely match. Copyright will not usually subsist in works that are "insubstantial" in quantitative terms97. A transmission lasting for a fraction of a second might indeed, in some circumstances, be too insubstantial to be regarded as "a television broadcast" within the Act98. In this appeal it is unnecessary to decide what would be the case in such an extreme instance. None of the subject segments broadcast in The Panel was of such an insubstantial duration. Accordingly, any such qualification to the notion of "a television broadcast" in the Act can be ignored in this appeal. It is irrelevant to this Court's present task. It is mainly by the operation of the fair dealing defence, and not by the artificial, uncertain and untextual proposition propounded by the appellant, that the battleground of the present dispute was to be fought in the manner contemplated by the Act. Having regard to the grounds of appeal before it, this Court is not concerned to review the decisions which the Full Court made on the fair dealing defence. To the extent that it is suggested that the fair dealing defence under the Act is unduly narrow99, that submission should be addressed to the Parliament. It 96 Handler, "The Panel Case and Television Broadcast Copyright", (2003) 25 Sydney Law Review 391 at 407. 97 Ricketson, The Law of Intellectual Property: Copyright, Designs & Confidential Information, (2002) at [7.215]. See also the reasons of Callinan J at [151]. 98 TCN Channel Nine Pty Ltd v Network Ten Pty Ltd (2002) 118 FCR 417 at 437 [90]. 99 de Zwart, "Seriously entertaining: The Panel and the future of fair dealing", (2003) 8 Media & Arts Law Review 1 at 17. Kirby would be an impermissible mode of reasoning for this Court to narrow the ambit of the infringement provided by the Act so as to enlarge the scope of free and unlicensed use of "a television broadcast", contrary to the terms of the Act. In any case, if the broad view of fair dealing adopted by Finkelstein J is correct, much of the sting is taken out of the criticisms of the Act voiced by the appellant in support of its submissions about the ambit of infringement. The correction of any remaining defects is a matter for the Parliament. It is not for this Court. Conclusion and order I have repeatedly obeyed the rule of the purposive construction of legislation. However, its application is always subject to textual limits. Sometimes the propounded construction would exceed those limits. This is such a case. The appellant's construction must be rejected. The respondents' construction should be preferred. The appeal should be dismissed with costs. Callinan CALLINAN J. The question in this appeal is whether the recording and broadcasting, not by way of fair dealing, by one telecaster of excerpts from the broadcasts of a commercial competing telecaster were infringements by the former of the latter's copyright. As to that the Full Court of the Federal Court was unanimously of the view that they were. In my opinion that view is the correct one. The facts The interests of the respondents are relevantly the same and they may therefore be treated as one party. The appellant and the first respondent are major commercial telecasters in competition with each other. Each holds a licence under the Broadcasting Services Act 1992 (Cth). Between August 1999 and June 2000, the first respondent broadcast a variety of television programmes which were recorded on video tape by the appellant. Excerpts from them ("the appropriations") were rebroadcast by the appellant during a programme called The Panel. That the appropriations were of real value to the appellant appears, among other things, from their frequency, and in some instances their length, a table of which I reproduce. Respondents' programme Date of broadcast by the first respondent The Today Show Midday Wide World of Sports A Current Affair Australia's Most Wanted Pick Your Face Crocodile Hunter Days of Our Lives Days of Our Lives Simply the Best The Border Medal Dinner Sunday The Awards Sale of the New Century The Today Show The Today Show Nightline Newsbreak Inaugural Allan Academy 10 August 1999 26 August 1999 26 September 1999 19 October 1999 11 October 1999 20 August 1999 21 August 1999 19 August 1999 20 August 1999 19 October 1999 31 January 2000 Date of rebroadcast of excerpts the appellant 11 August 1999 9 September 1999 29 September 1999 20 October 1999 13 October 1999 1 September 1999 25 August 1999 26 August 1999 26 August 1999 20 October 1999 8 March 2000 19 March 2000 27 March 2000 29 March 2000 29 March 2000 4 April 2000 4 April 2000 5 May 2000 15 May 2000 22 May 2000 5 April 2000 5 April 2000 10 May 2000 24 May 2000 24 May 2000 Callinan to be a Who Wants Millionaire The Today Show 29 May 2000 7 June 2000 28 June 2000 28 June 2000 The appellant promoted The Panel, which was produced by a production group calling itself "Working Dog", by advertising it as: "'our light entertainment stable', 'chuckle and jibe over the week's events', 'the best homegrown laugh all week', 'produces the best one-liners', 'though once deemed pretentious by some reviewers, it is impossible to imagine anyone else being able to make a round table chat equally successful', and 'musing irreverently over the topical issues of the week'." The Panel was first broadcast in early 1998. During each of that and the next year, 42 weekly episodes were produced and broadcast. By November 2000, the month of the trial, a further 36 weekly episodes had been produced. From mid-1998, the appellant claimed that The Panel had been the highest rated programme for viewers aged 16 to 39. Its programmes were said to be concerned with current affairs, news, comedy and "chat". The format was of a panel of four people, engaging in what was presented to viewers as unrehearsed conversation in the presence of a studio audience. One or two guests of prominence in, for instance, sport or entertainment, were usually invited to participate in the conversation each evening. Designers and regular panelists met weekly to select recent events and "breaking stories", and to identify prospective guests. The participants also then discussed the use of recent television footage of utility for the next programme. Television footage and material from other media selected for use on The Panel included footage of recent television programmes broadcast by each of the major television channels and satellite channels and not merely the respondents' Channel 9. Some other factual matters need mention. Although a broadcast by telecasting usually involves the transmission of a multiplicity of changing images and sounds, a broadcast may be of a still picture or moving images, with or without accompanying sounds. So too a part only, a moment or less of a television broadcast may be isolated, recorded, and reproduced either wholly or in part, whether by cropping or otherwise. "Cropping" was explained, non- controversially during the appeal as, for example, eliminating part of an image or picture and then perhaps magnifying the remainder to give a greater dramatic impact than the whole or the excluded parts might have given. The proceedings in the Federal Court The respondents brought proceedings in the Federal Court for an injunction against the appellant and damages for infringement of copyright. The appellant denied that it required any licence from the respondents to broadcast the excerpts that it did, and contended that they did not constitute a substantial Callinan part of matter in which the respondents held copyright. Further or alternatively, the appellant asserted, its conduct in relation to 10 episodes of The Panel was by way of fair dealing for the purpose of criticism or review, and that a sufficient acknowledgment of any relevant broadcast was made; and, in the further alternative, as to those 10 episodes, the excerpts were broadcast for the purpose of, or associated with, the reporting of news by means of broadcasting. At the trial the appellant introduced evidence that The Panel was, if not wholly, certainly to some extent at least, a humorous programme. Whatever relevance if any that might have to a defence of fair dealing, it has nothing to say about the entitlement to copyright of the creator of humorous matter. Issues were singled out by Conti J for separate argument. One of these was whether the appellant had rebroadcast the whole or a substantial part of any of the respondents' programmes. In the event, his Honour held that there was no infringement of copyright under s 87(a) of the Copyright Act 1968 (Cth) ("the Act") because the appellant had not made a cinematograph film of the whole or a substantial part of any of the broadcasts. His Honour also dealt with the defences of fair dealing, rejecting some and upholding others. Fair dealing is not an issue in this Court which is concerned only with the excerpts not so designated. The appeal to the Full Court of the Federal Court The Full Court of the Federal Court (Sundberg, Finkelstein and Hely JJ), to which the respondents appealed, unanimously took a different view from the primary judge. The effect of s 25(4) of the Act, the Full Court held, is that a cinematograph film or photograph of any of the visual images comprised in a television broadcast, is an exclusive right of the copyright owner, subject to specific statutory exceptions. It is not necessary that an image or images amount to a substantial part of the broadcast. One of the judges, Finkelstein J, said that there is copyright either in each and every still image transmitted, or in each visual image capable of being observed as a separate image on television. The excerpts rebroadcast by the appellant were cinematograph films of the visual images comprised in various of the respondents' broadcasts in terms of s 25(4) of the Act. The appellant therefore infringed the respondents' copyright under s 87(a) subject of course to any defences of fair dealing available to the appellant. In the context of Pt IV Div 2 of the Act, Hely J who wrote the principal judgment, said, and in my view, correctly, "rebroadcast" simply meant the broadcasting of what had already been broadcast by another broadcaster on television100: 100 TCN Channel Nine Pty Ltd v Network Ten Pty Ltd (2002) 118 FCR 417 at 433-435 Callinan "Section 25(4) applies to both a photograph of any of the visual images comprised in a television broadcast, as well as to a cinematograph film of any of those images. It is true that the present case is not concerned with photographs. But the fact that s 25(4) applies to a photograph of any of the visual images comprised in the broadcast supports the view that the expression 'any of the visual images' encompasses any one or more of those images, without any requirement that the images should amount to a substantial part of the broadcast. When is a television broadcast made? A television broadcast is made when the transmission of visual images and any accompanying sounds begins. A television broadcast continues to be made as the transmission of visual images and any accompanying sounds continues. Visual they are broadcast, themselves satisfy the definition of 'television broadcast' ... One does not have to wait until there has been a transmission of enough of the images and sounds to constitute a programme, or any other subject matter, before concluding that a television broadcast has been made." images and accompanying sounds as The appeal to this Court Copyright in sound recordings, cinematograph films and television broadcasts is dealt with in Pt IV Div 2 of the Act, the presently relevant provisions of which have existed in the Act in substantially the same form since The sections of the Act with which the Court is concerned that were in force at the relevant time101 should first be noted, including some of the definitions in s 10(1): "broadcast means transmit by wireless telegraphy to the public. cinematograph film means the aggregate of the visual images embodied in an article or thing so as to be capable by the use of that article or thing: of being shown as a moving picture; or 101 The Act has subsequently been amended, most significantly by the Copyright Amendment (Digital Agenda) Act 2000 (Cth), which commenced on 4 March 2001. Callinan of being embodied in another article or thing by the use of which it can be so shown; and includes the aggregate of the sounds embodied in a sound-track associated with such visual images. photograph means a product of photography or of a process similar to photography, other than an article or thing in which visual images forming part of a cinematograph film have been embodied, and includes a product of xerography, and photographic has a corresponding meaning. sound broadcast means sounds broadcast otherwise than as part of a television broadcast. television broadcast means visual images broadcast by way of television, together with any sounds broadcast for reception along with those images." Section 13 provides as follows: "13 Acts comprised in copyright (1) A reference in this Act to an act comprised in the copyright in a work or other subject-matter shall be read as a reference to any act that, under this Act, the owner of the copyright has the exclusive right to do. For the purposes of this Act, the exclusive right to do an act in relation to a work, an adaptation of a work or any other subject- matter includes the exclusive right to authorize a person to do that act in relation to that work, adaptation or other subject-matter." Section 14 is in the following form: "14 Acts done in relation to substantial part of work or other subject-matter deemed to be done in relation to the whole In this Act, unless the contrary intention appears: a reference to the doing of an act in relation to a work or other subject-matter shall be read as including a reference to Callinan the doing of that act in relation to a substantial part of the work or other subject-matter; and a reference to a reproduction, adaptation or copy of a work shall be read as including a reference to a reproduction, adaptation or copy of a substantial part of the work, as the case may be. This section does not affect the interpretation of any reference in sections 32, 177, 180, 187 and 198 to the publication, or absence of publication, of a work." Section 25 should also be set out in full: "25 Provisions relating to broadcasting (1) A reference in this Act to broadcasting shall, unless the contrary intention appears, be read as a reference to broadcasting whether by way of sound broadcasting or of television. (2) A reference in this Act to the doing of an act by the reception of a television broadcast or sound broadcast shall be read as a reference to the doing of that act by means of receiving a broadcast: from the transmission by which the broadcast is made; or from a transmission made otherwise than by way of broadcasting, but simultaneously with the transmission referred to in the last preceding paragraph; whether the reception of the broadcast is directly from the transmission concerned or from a re-transmission made by any person from any place. (3) Where a record embodying a sound recording or a copy of a cinematograph film is used for the purpose of making a broadcast (in this subsection referred to as the primary broadcast), a person who makes a broadcast (in this subsection referred to as the secondary broadcast) by receiving and simultaneously making a further transmission of: the transmission by which the primary broadcast was made; a transmission made otherwise than by way of broadcasting but simultaneously with the transmission referred to in the last preceding paragraph; Callinan shall, for the purposes of this Act, be deemed not to have used the record or copy for the purpose of making the secondary broadcast. In this Act: a reference to a cinematograph film of a television broadcast shall be read as including a reference to a cinematograph film, or a photograph, of any of the visual images comprised in the broadcast; and a reference to a copy of a cinematograph film of a television broadcast shall be read as including a reference to a copy of a cinematograph film, or a reproduction of a photograph, of any of those images. this section, re-transmission means any re-transmission, whether over paths provided by a material substance or not, and includes a re-transmission made by making use of any article or thing in which the visual images or sounds constituting the broadcast, or both, as the case may be, have been embodied." Section 86 is concerned with the nature of copyright in cinematograph films: "86 Nature of copyright in cinematograph films For the purposes of this Act, unless the contrary intention appears, copyright, in relation to a cinematograph film, is the exclusive right to do all or any of the following acts: to make a copy of the film; to cause the film, in so far as it consists of visual images, to be seen in public, or, in so far as it consists of sounds, to be heard in public; to broadcast the film; to cause the film to be transmitted to subscribers to a diffusion service." Section 87 provides as follows: Callinan "87 Nature of copyright in television broadcasts and sound broadcasts For the purposes of this Act, unless the contrary intention appears, copyright, in relation to a television broadcast or sound broadcast, is the exclusive right: in the case of a television broadcast in so far as it consists of visual images – to make a cinematograph film of the broadcast, or a copy of such a film; in the case of a sound broadcast, or of a television broadcast in so far as it consists of sounds – to make a sound recording of the broadcast, or a copy of such a sound recording; and in the case of a television broadcast or of a sound broadcast – to re-broadcast it." Section 91 should next be noticed: "91 Television broadcasts and sound broadcasts in which copyright subsists Subject to this Act, copyright subsists: in a television broadcast made from a place in Australia by: the Australian Broadcasting Corporation; the Special Broadcasting Service Corporation; or (iii) any prescribed person, being a person who is, at the time when the broadcast is made, authorised under a licence issued under the Radiocommunications Act 1992; and in a television broadcast (other than a broadcast transmitted for a fee payable to the person who made the broadcast) made from a place in Australia under the authority of: a licence allocated by the Australian Broadcasting Authority under the Broadcasting Services Act 1992; a class licence determined by that Authority under that Act; and in a sound broadcast made from a place in Australia by: Callinan the Australian Broadcasting Corporation; the Special Broadcasting Service Corporation; or (iii) any prescribed person, being a person who is, at the time when the broadcast is made, authorised under a licence issued under the Radiocommunications Act 1992; and in a sound broadcast (other than a broadcast transmitted for a fee payable to the person who made the broadcast) made from a place in Australia under the authority of: a licence allocated by the Australian Broadcasting Authority under the Broadcasting Services Act 1992; a class licence determined by that Authority under that Act." Section 95 prescribes the duration of copyright in television and sound broadcasts and s 99 provides as follows: "99 Ownership of copyright in television broadcasts and sound broadcasts Subject to Parts VII and X: the Australian Broadcasting Corporation is the owner of any copyright subsisting in a television broadcast or sound broadcast made by it; and the Special Broadcasting Service Corporation is the owner of any copyright subsisting in a television broadcast or sound broadcast made by it; and a person who is or has been a holder of a licence allocated the the Australian Broadcasting Authority under Broadcasting Services Act 1992 or a prescribed person for the purposes of subparagraph 91(a)(iii) or 91(c)(iii) is the owner of any copyright subsisting in a television broadcast or sound broadcast, as the case may be, made by that person; and a person who makes a television broadcast or sound broadcast under the authority of a class licence determined the the Australian Broadcasting Authority under Callinan Broadcasting Services Act 1992 is the owner of any copyright subsisting in the broadcast." Section 101 defines infringement in this way: "101 Infringement by doing acts comprised in copyright Subject to this Act, a copyright subsisting by virtue of this Part is infringed by a person who, not being the owner of the copyright, and without the licence of the owner of the copyright, does in Australia, or authorizes the doing in Australia of, any act comprised in the copyright. The next two succeeding sections do not affect the generality of the last preceding subsection. Subsection (1) applies in relation to an act done in relation to a sound recording whether the act is done by directly or indirectly making use of a record embodying the recording. Subsection (1) applies in relation to an act done in relation to a television broadcast or a sound broadcast whether the act is done by the reception of the broadcast or by making use of any article or thing in which the visual images and sounds comprised in the broadcast have been embodied." One other provision should be noted. It is s 135B: "135B Copies of transmissions In this part: a reference to a copy of a transmission is a reference to a record embodying a sound recording of the transmission or a copy of a cinematograph film of the transmission; and a reference to the making of a copy of a transmission is a reference to the making of a copy of the whole or a part of the transmission." In construing the Act, the text, if not of all importance, is certainly of primary importance. I would, in this connexion, repeat what was said in Rural Press Ltd v Australian Competition and Consumer Commission102: 102 (2003) 203 ALR 217 at 221 [7] per Gleeson CJ and Callinan J. Callinan "In the past, judges have sought to elucidate the meaning of this concept by examining the legislative history. That process of construction is legitimate, provided it is not taken too far. ... It [resort to parliamentary statements] has also driven courts to the unproductive and inappropriate task of seeking to construe the parliamentary materials and speeches rather than the statute." Although a court is entitled to have regard to the legal and historical context of legislation, and in particular the mischief that it is enacted to cure, care must always be exercised in using all extrinsic material, including in particular assumed historical facts, to ensure that those facts are accurately and relevantly completely stated. Facts of the latter kind are that broadcasting of both radio and television in the United Kingdom was, from the beginning (in 1922) and for a long time afterwards undertaken exclusively by one broadcaster, latterly called the British Broadcasting Corporation ("the BBC")103. Although that broadcaster was financed at the outset by a consortium of manufacturers of domestic wireless receiving sets, it was conducted on entirely non-commercial lines. Advertising was not permitted. Emphasis was placed upon the objective dissemination of news, culture, education and entertainment104. By 1927 control of the broadcaster was in the hands of its governors, who although appointed by the Executive, were expected to be independent of it105. There was, in consequence, until 1955106 no commercial competition in broadcasting of any kind except for unlawful broadcasting by "pirate" broadcasters operating from vessels moored or steaming beyond the territorial waters of the United Kingdom107. In short, for many years, infringement by commercial competitors of the BBC's broadcast matter was non-existent, and not something for which any special or express provision was necessary. Although provision was made for public television by the Television Act 1953 (Cth) and by amendments to the Broadcasting Act 1942 (Cth) in 1956108, from the outset of actual telecasting in Australia in that year, there was, unlike in the United Kingdom, commercial competition. 103 See Briggs, The Birth of Broadcasting, (1961). 104 Briggs, The Birth of Broadcasting, (1961) at 357-359. 105 Briggs, The Birth of Broadcasting, (1961) at 357-359. 106 Briggs, The BBC: The First Fifty Years, (1985) at 288. 107 Briggs, The BBC: The First Fifty Years, (1985) at 329. 108 Broadcasting and Television Act 1956 (Cth). Callinan The Broadcasting Act is of relevance to this discussion, but in these respects only. It, rather than the Act or its precursor109, was the enactment which, by s 121, prohibited the broadcasting of matter emanating from other stations, and it was programmes of the latter that it thereby protected. "Program" was defined in that Act as including an "advertisement and any other matter"110. Similarly, "program" is defined in s 6 of the Broadcasting Services Act as: "(a) matter the primary purpose of which is to entertain, to educate or to inform an audience; or advertising or sponsorship matter, whether or not of a commercial kind." The word "programme" nowhere appears in the Act, and this is so despite that the reports to which other members of the Court have referred did use the term111. A concept of a programme, as to the nature, content and duration of which there is much room for debate, has in my opinion, no part to play in the resolution of the issues here. In enacting the Act, the Parliament must have been conscious of the different histories of broadcasting in Australia and the United Kingdom, as well as the earlier different provisions of the Broadcasting Act. The Act, especially those sections of it with which this appeal is concerned, was avowedly designed to deal with new rights, as the Attorney-General in his second reading speech expressly acknowledged112: "[T]he Bill confers a number of new rights, particularly in respect of broadcasts, cinematograph films and printed editions of books." The statements made by the Attorney-General also acknowledged that the 1968 Bill represented a significant change from the position that had been adopted on these matters in 1967113. The Attorney-General was well aware of the different and ephemeral nature of a television broadcast as a medium of 109 Copyright Act 1912 (Cth). 110 Broadcasting Act, s 4. 111 See reasons of McHugh ACJ, Gummow and Hayne JJ at [23]-[24]. 112 Australia, House of Representatives, Parliamentary Debates (Hansard), 16 May 113 Australia, House of Representatives, Parliamentary Debates (Hansard), 16 May Callinan communication unless and until it was recorded, and its value once it was, to other broadcasters. In the same speech he said114: "Both the Australian Broadcasting Commission and the commercial broadcasting and television organisations had asked for a more extensive right of making what are known as 'ephemeral' records than is given by clause 47 of the Bill. In my opinion, however, the Berne Convention permits only the making of ephemeral records by a broadcaster for the purpose of his own transmissions without any obligation to the copyright owner. But since the Convention also permits the recording of musical works under compulsory licence, on payment of compensation to the copyright owner, it has been thought reasonable to include in the Bill what is in effect a statutory licence for the making of ephemeral records by a broadcasting organisation for use by other broadcasting organisations." (emphasis added) And later he said115: "I turn now to those provisions of the Bill which provide for copyright to subsist in broadcasts, cinematograph films, sound recordings and published editions. These provisions are to be found in clauses 84 to 113 of the Bill. These clauses involve substantial changes in the existing law and, in respect of the rights given in sound recordings, substantial differences from the provisions of the 1967 Bill. Broadcasts are not protected at all under the existing copyright law. Some protection against the use of broadcast material is given by the Broadcasting and Television Act. Sub-clause (2) of clause 9 of this Bill specifically preserves the operation of the relevant provisions of that Act. Under the Bill the owner of the copyright in a radio or television broadcast is given the right to control rebroadcasting of that broadcast. In the case of a television broadcast he is given the exclusive right to make a cinematograph film of the broadcast or a copy of such a film. In the case of a sound broadcast, or the sounds accompanying a television broadcast, the rights include the exclusive right to make a record of that broadcast or reproductions of that record. These provisions are contained in clause 87 of the Bill. A cinematograph film is protected under the existing law in two ways. Inasmuch as an ordinary cinematograph film consists of a series of individual photographs, each frame is protected as an artistic work. But if 114 Australia, House of Representatives, Parliamentary Debates (Hansard), 16 May 115 Australia, House of Representatives, Parliamentary Debates (Hansard), 16 May Callinan the arrangement or acting form or the combination of incidents represented in a cinematograph film give the work an original character, the film is protected as a dramatic work. The present Bill establishes a separate protection for cinematograph films. The rights given to the owner of the copyright in a cinematograph film are set out in clause 86 of the Bill. The copyright in a cinematograph film continues until the expiration of 50 years from the end of the calendar year in which the film was first published. For many purposes, ordinary cinematograph film and videotape are interchangeable. Thus a scene may be recorded by a television camera on videotape and the videotape later copied on to an ordinary cinematograph film. The incidents recorded may be seen either by viewing the videotape on a television screen or by viewing the cinematograph film on a cinema screen. The Bill therefore assimilates videotape to ordinary cinematograph film for the purposes of copyright protection and the term 'cinematograph film' appearing in the Bill is defined as including videotape." (emphasis added) What is also of significance is that the Rome Convention116, to which the Attorney-General referred, by Art 13 sought to protect not "programmes", however they might be defined, but broadcasts and to prohibit fixation or the rebroadcasting of fixations of them. There are other matters which suggest that recourse to the United Kingdom experience and learning is unlikely to assist in the resolution of the problem here. The statutory provisions there are quite different, in particular that no separate and special provision is made for copyright in television broadcasts. Section 6(1) of the Copyright, Designs and Patents Act 1988 (UK) ("the United Kingdom Act") defines "broadcast" only slightly differently from the Australian Act, to mean a transmission by wireless telegraphy of visual images, sounds or other information which: is capable of being lawfully received by members of the public, or is transmitted for presentation to members of the public". But of significance is the fact that there is in the United Kingdom no analogue to s 87 of the Australian Act. Rather, s 16 of the United Kingdom Act is a general provision (applying indiscriminately to all forms of copyright works) that refers to "[t]he acts restricted by copyright in a work". Section 16(1)(a) provides that "to copy the work" is such an act. Infringement of copyright in a work occurs pursuant to s 16(2) of the United Kingdom Act when a person, without licence, does any of the acts protected by the copyright. Copying 116 International Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organisations, Rome 1961. Callinan relevantly for the purposes of the United Kingdom Act is governed by s 17(4) of "Copying in relation to a film, television broadcast or cable programme includes making a photograph of the whole or any substantial part of any image forming part of the film, broadcast or cable programme." The United Kingdom Act therefore is quite differently structured and worded from the Australian Act. For this reason and the others to which I have referred, statements in English texts are not capable of automatic application in this country. In Laddie's The Modern Law of Copyright and Designs, it is suggested that in relation to s 17(4), "the taking of even a single frame of a film (or the equivalent amount of a TV broadcast) may be an infringement."117 Other English text writers take a different view. For example, Garnett, James and Davies write118: "No further definition of 'copying' in relation to a broadcast is given in the 1988 Act other than that it includes making a photograph of the whole or any substantial part of any image forming part of the broadcast … In the usual way it will also be an infringement to copy the whole or any substantial part of the broadcast, whether directly or indirectly or transiently or incidentally to some other use." (emphasis added) Similarly, Cornish and Llewelyn observe119: "The 1988 Act is not so specific as its predecessor about what acts of 'copying' infringe sound recording, film, broadcasting and cable-casting copyright. Presumably, as before, this includes making recordings or films that are substantial copies of those things." (emphasis added) The Act falls to be read therefore against the background of these indisputable facts. The parties compete with each other. The production of any programme, indeed each and every frame and segment of it, comes at a cost. It is produced in order to make money by inducing advertisers to pay to have their 117 Laddie et al, The Modern Law of Copyright and Designs, 3rd ed (2000), vol 1 at 429. The authors add later that "anything which is not de minimis will be regarded as 'substantial'." 118 Garnett, James and Davies, Copinger and Skone James on Copyright, 14th ed (1999), vol 1 at 446 (footnotes omitted). 119 Cornish and Llewelyn, Intellectual Property: Patents, Copyright, Trade Marks and Allied Rights, 5th ed (2003) at 434. Callinan activities advertised in association with its broadcast one or more times. Further value may arise from the isolation, reproduction and broadcasting of an image or images, with or without sound, from it, and the licensing of it or an isolated image or images from it, whether by and in a photograph, a film or a video film. What is clear in this case is that value did lie in the copying, reproduction and rebroadcasting of segments, albeit generally fairly brief segments, of the respondents' programmes. That value had two aspects: it enabled the appellant to gain revenue from advertising associated with The Panel; and it relieved the appellant of the cost of buying or producing other matter to occupy the time taken by the rebroadcasting, during The Panel, of the copied and reproduced segments. The intention of Pt IV Div 2 of the Act was, as the Attorney-General said, broadly not only to place television footage on at least the same basis as other original work, particularly moving films, protected by the Act, but as appears from the language used in it, with necessary adaptations to suit the medium and the means available to competitors to exploit it, and in consequence to create new rights. Why should, it is reasonable to ask, the appellant, save to the extent that it deals fairly with any of the respondents' valuable broadcasted matter, get it and rebroadcast it for its own commercial benefit, for nothing? The question in this case is whether the Act prevents it from doing that. The use by the appellant of excerpts from the respondents' broadcasts was blatant. And although blatant appropriation of the kind which has occurred here might not be such as to warrant an evangelical fervour120 in responding to it, in the nakedly commercial context of television broadcasting in Australia, the test of "what is worth copying is prima facie worth protecting" posed by Peterson J in University of London Press Ltd v University Tutorial Press Ltd121 has much to commend it, and provides at least a reasonable starting point. After all, in recognising the validity of the respondents' copyright in excerpts from their programmes, the Court would not be denying access to the general public of the golden words of a new Shakespeare. This is a case of blatant commercial exploitation, neither more nor less. It has always been the respondents' case that the appellant has infringed both ss 87(a) and 87(c) of the Act. The appellant has never denied that it copied by reproducing in full the respondents' programmes. It has therefore infringed, on any view, s 87(a) of the Act. As to s 87(c) however, the appellant argues that because it did not rebroadcast other than an excerpt from, that is to say, less, indeed much less than, 120 See Autospin (Oil Seals) Ltd v Beehive Spinning [1995] RPC 683 at 700 per 121 [1916] 2 Ch 601 at 610. Callinan the whole of any of the programmes of the respondents, it did not rebroadcast "a television broadcast" of the respondents. In short the appellant submits that a television broadcast within s 87 of the Act cannot be less than the whole or a substantial part of a television programme, notwithstanding that the relevant sections do not anywhere use that term, and the Act attempts no definition of it. The appellant's proposition, it further argues, is correct because otherwise there is no, or little work for s 14 of the Act to do. I am unable to agree. The definition of cinematograph film does not assist the appellant. The aggregate of a few seconds of visual images is, as occurred in this case, capable of being embodied in a video tape, or electronically otherwise, by the use of which it can be shown. In those few seconds, there were, and there always will be, except perhaps when a "still" is shown, certainly more than one, and almost certainly a multiplicity of images and sounds. The test cannot be simply whether the images and sounds captured and fixated last a millisecond or half an hour. In aggregate they still constitute a "broadcast". Nor can the existence of a broadcast be denied because it is not possible to speak of a single moment of sound. Perceptions of visual images and sound are different. It is no more correct to say that a single television image is not a broadcast because its accompanying sounds are unintelligible, than it is to say that a silent film shown on television is not a broadcast because it has no accompanying sounds at all. That the appellant thought a few seconds of the respondents' broadcast worth rebroadcasting provides some indication of the understanding in the industry of what is sufficient to constitute a broadcast. Hely J was right to hold that "any of the visual images", the expression used in s 25(4) of the Act, means a visual image, that is something that can be isolated and fixated. The Act was not enacted in a vacuum of awareness as to how the industry operated, or without regard to practicalities. Those practicalities include the certain knowledge that one television licensee would only seek to use what would be of real value to it: it would have no interest, commercial or otherwise, in anything less than something complete enough in itself to be viewed, in short, a broadcast. In that sense the term "broadcast" is almost self-defining. To regard a broadcast differently, as for example, a "programme", is not only to introduce a concept not reduced to concrete language or even implied anywhere in the Act, but is also to create a deal of uncertainty about its operation. The view adopted at first instance by Conti J is, with respect, incapable of any certain application. On his Honour's view the programme can be the whole programme "or respective segments ... if [it] is susceptible to subdivision by reason of the existence of self-contained themes."122 To say that is not to say of 122 TCN Channel Nine v Network Ten (2001) 108 FCR 235 at 272 [43]. Callinan what a programme consists. Is it the "menu" of the channel or programme for the next twenty-four hours, or the forthcoming week, or for a month, or a year, or however long it schedules its broadcasts? What is a self-contained theme? There may be many threads and indeed themes to a television story, coming together only at the end to make a self-contained theme, but before that point providing valuable snippets of utility to competitors. In any event, none of these, "programme", "segments of a programme", or "self-contained theme" is the language of the Act. The Act can be read harmoniously with the conclusion that the Full Court reached. I have already referred to the definition of a cinematograph film and need only make the further point that its emphasis is upon use, in particular, capability of use, and not duration of the matter used. The further relevant concept which the legislators have chosen to define is the concept of "television broadcast" and not a television programme. The legislature having eschewed such a definition and therefore the relevance of a concept of it for the purposes of the Act, I would not regard it as appropriate to import either a definition of it from another Act, for example the Broadcasting Services Act, or an understanding, assuming a common one could be identified, of it by participants in the industry. In any event an importation from the former would not assist the appellant. Unlike in Newspaper Licensing Agency Ltd v Marks & Spencer plc123 where it was demonstrated that a particular undefined term "published edition" had a clear and well-established meaning in the publishing trade, "broadcast" is defined by the Act, and programme, its suggested synonym, was not shown to have any accepted meaning in the television industry. The presence of s 14 of the Act compels no different conclusion. Its opening words make it clear that it must be read subject to the appearance elsewhere in the Act of any contrary intention. The combination of ss 25, 86, 87, 91 and 101 manifest such an intention. Even if they did not, s 14 can stand alone to perform useful work. One type of such work is the ultimate prevention of rebroadcasting of reduced, blended, adapted, altered or otherwise cropped images or an aggregation of images previously broadcast by a television channel. I would accept that a question of substantiality may in some circumstances require consideration of the quality, importance, relevance and duration of part of a work in an appropriate case, but that it may, does not mean that the recording and rebroadcasting of a very brief segment of a broadcast is not an infringement of the broadcaster's copyright. It is noteworthy that s 25(2) speaks of the reception of a television broadcast. Indeed the Act speaks of three different processes: broadcast, 123 [2003] 1 AC 551 at 558 per Lord Hoffmann. Callinan transmission and reception. Each is different. The copyright arises at the first point, of broadcast, and does not depend upon its reception. Section 25(4) is also important. The words "of any of the visual images", whether by reference to other sections of the Act or otherwise, admit of no meaning other than either a singularity or multiplicity of images. To make a copy therefore of any image comprised in a broadcast is to make a copy of a cinematograph film within s 86(a) of the Act just as to broadcast the image is to broadcast a film of it within s 86(c) of the Act. So too, s 87 affords the protection of copyright to the image because the reference there to a cinematograph film must be read, pursuant to s 25(4) as a reference to any of the images comprised in the broadcast. Section 91 makes no reference to a programme. It refers not to "television broadcasting" or to "television broadcasts". It relevantly throughout uses the words "a television broadcast" as does s 99. And finally, s 135B, not only uses the words "cinematograph film" but also, in par (b) refers to a copy of the whole or "a part of the transmission". Nothing turns, in my opinion, upon any perceived differences between the quality or nature of the copyright afforded by the Act to television broadcasts and other copyright holders. It was and was intended to be a new and unique right. The medium is very different from others. To exploit it, different and perhaps more expansive infrastructures, fees, techniques and resources are required. The industry is, and has always been in this country, a highly competitive, and, as this case shows, a highly commercialised one. There may have been good reason for the legislature to single it out for special treatment. It is for the Court to give effect to the language of the Act and not to speculate about that. I would dismiss the appeal with costs.

HIGH COURT OF AUSTRALIA APPELLANT AND THE QUEEN RESPONDENT Hamilton (a pseudonym) v The Queen [2021] HCA 33 Date of Hearing: 22 June 2021 Date of Judgment: 3 November 2021 ORDER Appeal dismissed. On appeal from the Supreme Court of New South Wales Representation H K Dhanji SC with D R Randle for the appellant (instructed by George Sten H Baker SC with B K Baker for the respondent (instructed by Office of the Director of Public Prosecutions (NSW)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Hamilton (a pseudonym) v The Queen Criminal practice – Trial – Directions to jury – Where appellant charged with ten counts of aggravated indecent assault against three of his children – Where appellant did not seek that counts be tried separately – Where appellant alleged complainants' evidence was inconsistent and had been concocted – Where appellant did not seek anti-tendency direction and no anti-tendency direction given – Where trial judge gave Murray direction requiring jury not to convict on any count unless satisfied that evidence of each child was honest and reliable in relation to that count – Where trial judge directed jury to give separate consideration to each count – Whether trial miscarried because of failure to give anti-tendency direction. Words and phrases – "anti-tendency direction", "concoction of evidence", "counts tried together", "failure of counsel to seek a direction", "forensic advantage", "forensic strategy", "impermissible tendency reasoning", "miscarriage of justice", "multiple complainants", "Murray direction", "separate consideration direction", "stark contest of credibility". Criminal Appeal Act 1912 (NSW), s 6(1). KIEFEL CJ, KEANE AND STEWARD JJ. The appellant was charged with ten counts of aggravated indecent assault contrary to s 61M(2) of the Crimes Act 1900 (NSW). The offences were alleged to have been committed on separate occasions against three of the appellant's five children. The case has proceeded on the footing that, had each count been tried separately, only the evidence of offending bearing on each particular count would have been admissible against the appellant. The defence did not seek to have the counts tried separately. Rather, the defence embraced the opportunity to have all ten counts tried together as part of a strategy of inviting the jury to consider the evidence of all the complainants on all counts and, from a consideration of the totality of the evidence, to conclude that the children fabricated their allegations against him at the urging of their mother, his former wife. At trial, counsel for the defence did not seek a direction from the trial judge – which the appellant now contends should have been given – that the jury must not reason from a finding that the appellant was guilty of one charged offence to conclude that he was guilty in respect of other charged offences because he was the kind of person who engaged in that kind of misconduct ("an anti-tendency direction"). The trial judge did, however, at the specific request of the defence, direct the jury that they could not convict the appellant unless they were satisfied beyond a reasonable doubt that the evidence of each child was honest and reliable in relation to each of the counts concerning that child ("the Murray direction"). The jury returned guilty verdicts on all ten counts. The appellant appealed to the New South Wales Court of Criminal Appeal on three grounds, all of which were rejected. The first ground is the only basis upon which the appellant appeals to this Court. This ground was that the trial miscarried because the trial judge did not give the jury an anti-tendency direction. The Court of Criminal Appeal (Adamson and Beech-Jones JJ, Macfarlan JA dissenting) rejected this ground, concluding that the absence of an anti-tendency direction did not, in the circumstances of this case, expose the appellant to a risk of conviction by the application of tendency reasoning and did not give rise to a miscarriage of justice. In this Court, the appellant argued that the Court of Criminal Appeal erred in this regard. For the reasons that follow, the Court of Criminal Appeal was correct in concluding that there was no miscarriage of justice at trial. Accordingly, the appeal to this Court must be dismissed. The trial The offences charged were alleged to have been committed against the three complainants between November 2014 and February 2016. Counts 1 to 3 were committed against the appellant's daughter ("the First Child"), who was 15 years of age at the time of the offences. Those counts concerned three occasions on which the appellant got into the First Child's bed and touched her vagina over her clothes. On the third such occasion, the subject of count 3, the complainants' mother walked in on the appellant in bed with the First Child, but the First Child did not at that time say anything about what had happened. The First Child first complained to her mother some months later, at a family outing at a Thai restaurant. Counts 4 to 8 were committed against one of the appellant's sons ("the Fifth Child"), who was between 6 and 7 years of age at the time of the offences. Those counts concerned one occasion on which the appellant touched the Fifth Child's bottom after he got out of the shower (count 4) and two occasions on which the appellant touched the Fifth Child's bottom and penis simultaneously after he got out of the shower (counts 5 and 6 and counts 7 and 8 respectively). The Fifth Child gave evidence that he complained to his mother after each occasion. The First Child also gave evidence that the Fifth Child had complained about the incidents to her. Counts 9 and 10 were committed against another of the appellant's sons ("the Third Child"), who was between 11 and 12 years of age at the time of the offences. Those counts concerned two occasions on which the appellant grabbed the Third Child's penis. The Third Child complained to a counsellor about two years later. The Crown case At trial, each complainant gave evidence of the appellant's offending against that child and of the circumstances of that child's complaint about the appellant's conduct. In addition, the Crown led further evidence that fell into three categories. The first category can be described as "aggression evidence". This included evidence from the complainants of episodes of aggression and violence by the appellant towards his male children. This evidence also included three videos showing the appellant acting violently towards his children. The aggression evidence was led for a dual purpose: as "context evidence" both to explain the nature of the relationships between the appellant and his children and to explain the complainants' reluctance to make contemporaneous complaints; and as character rebuttal evidence to counter the evidence which the appellant had foreshadowed he would adduce in support of his good character1. The second category of evidence can be described as the "rugby ball incident evidence". This related to a specific incident in January 2016 in which the appellant threw the Fifth Child to the ground and trod on his arm and head, and 1 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [13]. threw a rugby ball at the mother's chest at a time when she was recovering from breast reconstruction surgery. The appellant was convicted of the common assault of the Fifth Child and of the complainants' mother. The rugby ball incident evidence was also led as character rebuttal evidence2. The third category of evidence was described by the trial judge in his summing-up to the jury as the "evidence of other acts". This comprised evidence from each of the Third Child and another of the appellant's sons ("the Fourth Child") of instances where they saw the appellant touching the Fifth Child's penis. This evidence did not relate to any specific offence with which the appellant was charged. Instead, the Crown sought to rely on this evidence of other, uncharged acts as tendency evidence in respect of the counts concerning the Fifth Child. To that end, in advance of the trial, the Crown served a tendency evidence notice under s 97 of the Evidence Act 1995 (NSW). In the notice, the Crown described the evidence as demonstrating the appellant's tendency to have a sexual interest or inappropriate interest in his male children under the age of 13, and to act on that interest. The notice indicated that the Crown intended not only to rely on the evidence of the uncharged acts against the Fifth Child as tendency evidence supporting the counts concerning the Fifth Child, but also to rely on the evidence of the counts concerning the Third and Fifth children as being "cross-admissible as tendency evidence for their own counts and for each other"3. The Crown did not advance any paths of potential tendency reasoning which related to the counts committed against the First Child. The Crown brought its tendency application on for argument prior to the trial; but, at the urging of the appellant's trial counsel, the application was adjourned to be determined later in the trial, by which time the evidence the subject of the tendency application had been adduced by the Crown4. The appellant's counsel told the trial judge, during argument on the tendency application, that the defence had "concluded that tactically all that evidence can go in" because it was 2 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [13]. 3 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [19]-[20]. 4 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [91]. so inconsistent that "no reasonable jury in our view would accept it"5. The "[W]e want it in as all part of the circumstances the whole picture we want – I mean it's an unusual situation I know but that's what we want to do, we want it in as the whole picture for the jury". The trial judge rejected the Crown's tendency evidence application. His Honour concluded that although the evidence would have significant probative value, its probative value was outweighed by the risk of unfair prejudice to the appellant. An aspect of the prejudice to which his Honour adverted was the possibility that the giving of a tendency direction could mislead or confuse the jury in relation to the use of evidence "which is already in as context, and partly as character evidence"7. In so ruling, the trial judge did not expressly address the second aspect of the Crown's tendency application, namely, the cross-admissibility of the evidence of the Third and Fifth children concerning the counts against them. No doubt, as was noted by Macfarlan JA, the trial judge's ruling "operated as a rejection of all that the Crown sought in its [tendency] notice"8. Ultimately, the evidence of the other, uncharged acts was left to the jury for the limited purposes of providing context to the Fifth Child's allegations and as "evidence to deal with the assertions made by [the appellant] of concoction of evidence". The Crown, in its final address to the jury, was careful not to invite the jury to engage in reasoning to a guilty verdict on any count because they considered that he was guilty on another count and was therefore the kind of person who was likely to have committed the offence in question. The Crown summarised each complainant's evidence separately, and advanced reasons why the jury might accept that evidence quite apart from the evidence of the other complainants as to the appellant's offending against them. 5 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [17]. 6 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [93]. 7 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [21]-[22], [92]. 8 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [23]. The defence case The appellant gave evidence in which he denied all the allegations against him. He contended that the Crown case was concocted. The appellant said that his wife, with whom he was embroiled in acrimonious Family Court proceedings, had orchestrated the children's allegations against him. The appellant's counsel, in his opening address to the jury, stated that he would ask them to "join the dots" to conclude that the mother had manipulated the children to tell lies against their father9. The defence highlighted what were said to be inconsistencies between the evidence of the Fifth Child and the evidence of the Third and Fourth children concerning the uncharged acts alleged to have been committed against the Fifth Child as an indication that the evidence of the children had been concocted10. The appellant also called evidence from several witnesses who testified to his good character. The summing-up In a course that was rightly deprecated by the Court of Criminal Appeal11, the summing-up was, at the request of the trial judge, largely drafted by the Crown and agreed to by trial counsel for the appellant12. During a break in his Honour's delivery of the summing-up, the appellant's counsel sought a Murray direction13. The giving of that direction was opposed by the Crown. The trial judge ruled that he would "err on the side of caution" and gave a Murray direction in a form agreed by the parties14. In all, the trial judge gave four directions to the jury which are of relevance to the present appeal. Given that the appellant's argument in this Court is that yet a further direction to the jury was necessary in order to avoid a miscarriage of justice, it is desirable to refer, necessarily at some length, to the directions that 9 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [89]. 10 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [93]. 11 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [84], [97]. 12 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [32]. 13 So called after R v Murray (1987) 11 NSWLR 12. 14 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [99]. were given in order to assess the extent of the risk that the jury might have reasoned to guilty verdicts by a path of impermissible tendency reasoning. The first direction concerned what the trial judge referred to as "context evidence". As can be seen, this direction included an anti-tendency direction in relation to both the evidence of other acts and the aggression evidence: "I turn to a topic which is described as context evidence. You have heard evidence in the trial of other occasions, apart from those relating to any particular account, where the children have alleged that the accused was aggressive and hurt them. In the case of [the Fifth Child], he said that the accused punched him, kicked him, and smacked him. You have also heard evidence from [the Third Child] that the accused was violent and rough, and [the First Child] said that he was aggressive towards her brothers. That evidence has been placed before you to assist you in understanding the relationship that the Crown alleges existed between the accused and the complainants, his children, in 2015. The Crown has placed that evidence before you also to explain the delay in complaints made by [the First Child] and [the Third Child] and I will refer to that evidence later. Obviously, before you can convict the accused in respect of any charge you must be satisfied beyond a reasonable doubt that a particular allegation occurred. That is, the Crown must prove the particular act as alleged by the complainant. In addition to the evidence led by the Crown specifically in relation to the counts on the indictment, the Crown has led evidence of other acts of alleged misconduct by the accused towards [the Fifth Child]. I shall, for the sake of convenience, refer to this evidence as evidence of other acts. The evidence of the other acts is as follows; first there were two acts of the accused allegedly touching [the Fifth Child], on the penis, in the bathroom and downstairs, allegedly witnessed by [the Third Child]. Secondly, acts of the accused touching [the Fifth Child's] penis, in the bathroom ensuite, allegedly witnessed by [the Fourth Child]. So, context evidence is background evidence which explains the complainants' conduct by putting it in a realistic context. The Crown says that these occasions, which are different to the ones described by [the Fifth Child], have been placed before you to understand the nature or the context of [the Fifth Child's] allegations. The Crown also relies on the evidence to deal with the assertions made by [the accused] of concoction of evidence. I must give you some important warnings with regard to the use of this evidence of other acts, that is, acts that are not the subject of a charge. Firstly, you must not use evidence of other acts as establishing a tendency on the part of the accused to commit offences of the type charged. You cannot act on the basis that he is likely to have committed the offences charged because there are other allegations against him. The evidence has a very limited purpose, as I have explained to you, and it cannot be used for any other purpose, or as evidence that the particular allegations contained in the charges have been proved beyond a reasonable doubt. Secondly, you must not substitute the evidence of other acts witnessed by [the Third Child] and [the Fourth Child] for the evidence of the specific allegations contained in the charges in the indictment. The Crown is not charging a course of misconduct by the accused, but has brought particular allegations arising from what [the Fifth Child] says was sexual misconduct. You are concerned with the particular and precise occasions alleged by [the Fifth Child]. You must not reason that just because the accused may have done something wrong to [the Fifth Child] on some other occasions witnessed by [the Third Child] or [the Fourth Child]. He must have done so on the occasion alleged in the indictment. You cannot punish the accused for other acts attributed to him by [the Third Child] or [the Fourth Child], by finding him guilty of any charge on the indictment. Such a process of reasoning would amount to a misuse of the evidence and would not be in accordance with the law." Secondly, the trial judge gave a "separate consideration direction": "[T]here are ten separate trials being conducted here. There are ten counts. The trials are being heard together for convenience, because there are a number of common parties, in relation to the complainants and the accused, but you must give separate consideration to each count. That means that you are entitled to bring in verdicts of guilty on some counts and not guilty on some other counts, if there is a logical reason for that outcome. If you were to find the accused not guilty on any count, particularly if that was because you have had doubts about the reliability of the evidence of one or all of the complainants then you would have to consider how that conclusion affected your consideration of the remaining counts in relation to that complainant." Thirdly, the trial judge gave a "character direction": "I turn to the question of character. The accused has called evidence to establish that he is a person of good character, and you have heard evidence from a number of witnesses who said that he is an honest person, and not a person likely to commit these offences. The Crown has led evidence to contest that assertion. The Crown led evidence of the three videos of the accused where the Crown says that he punched [the Fifth Child] in the stomach, put a pillow over [the Third Child's] face, and threatened to punch [the Third Child], as evidence to show that he was not a person of good character when it came to his children, and that he had a bad disposition towards his children. Similarly, the Crown has put before you the evidence of the common assault of [the Fifth Child], where he was convicted of throwing [the Fifth Child] to the ground and treading on his arm and head; and the common assault of [the mother], where he threw a ball at her chest. This is done to rebut the suggestion that he is a person who is of good character and who, other than those two matters, has no prior convictions. The Crown says these events depict the accused as a person not of good character and a bad parent, and it says that this incident, along with the video, show that the father was trying to control disobedient children. [Counsel for the accused] said that this incident, along with the videos showed that [the accused] was trying to control disobedient children, and that he had no support from his wife. It is necessary for you, bearing in mind the arguments that have been put on both sides on this issue, to have regard to the totality of the evidence relating to the character of the accused, and determine whether you consider that the accused is a person generally of good character. You may reason that such a person of good character is unlikely to have committed these offences as alleged by the Crown. A jury can use the fact that a person is of good character to support his credibility, and you may reason that a person of good character is less likely to lie or give a false account in giving evidence before you, or in giving an account of the events in question in answer to Police. Whether you reason that way is a matter for you to determine. None of this, of course, means that good character provides the accused with some kind of defence. It is only one of many factors you are entitled to take into account in determining whether you are satisfied beyond a reasonable doubt of the guilt of the accused. The weight that you give to the fact that the accused is a person of good character is completely a matter for you, but you should take it into account in the way that I have indicated to you." Fourthly, as has been noted, the trial judge gave the "Murray direction" at the request of the appellant: "You have to exercise caution before you could convict the accused on any count because the Crown case largely depends on you accepting the reliability of a single witness. For example, [the First Child] is the only witness to the events that make up the counts on the indictment for her allegations, other than count 3 where her mother says she saw the accused in her bed. On the Crown case [the Fifth Child] was the only witness to the events that he describes, and [the Third Child] is the only witness regarding his allegations. That being so, unless you are satisfied beyond a reasonable doubt that [the First Child], [the Fifth Child], and [the Third Child], are both honest and accurate witnesses in the accounts that they have given you cannot find the accused guilty. Before you could convict the accused you should examine the evidence of the complainants very carefully in order to satisfy yourselves that you can safely act upon that evidence to the high standard required in a criminal trial. ... In any criminal trial where the Crown relies solely or substantially on the evidence of a single witness, the jury must always approach that evidence with particular caution because of the onus and standard of proof placed upon the Crown. I am not suggesting that you are not entitled to convict the accused on any count on the evidence of a complainant, clearly you are entitled to do so, but only after you have carefully considered the evidence and satisfied yourself that it is reliable beyond a reasonable doubt. In considering the complainants['] evidence in each case and whether it does satisfy you of the guilt of the accused you should, of course, look to see if it is supported by any other evidence." Despite a suggestion by the appellant that the last clause of this direction, by instructing the jury to consider "other evidence" that might support a complainant's evidence, might have been taken by the jury to be an invitation to engage in tendency reasoning, it is apparent from context that the trial judge was speaking of other evidence that directly supported a complainant's evidence. Such evidence may have included, for example, the evidence of the complainants' mother finding the appellant in bed with the First Child in relation to count 3, or the videos in the aggression evidence in support of the complainants' evidence of the nature of their relationships with the appellant. The Court of Criminal Appeal The ground of appeal to the Court of Criminal Appeal with which this Court is concerned did not involve any suggestion that the verdict of the jury should be set aside because it was "unreasonable, or cannot be supported, having regard to the evidence". And because the appellant had not sought an anti-tendency direction, it could not be said that the trial judge had made a "wrong decision of any question of law". The only basis on which the appeal might be brought pursuant to s 6(1) of the Criminal Appeal Act 1912 (NSW) was that, on some other ground, "there was a miscarriage of justice". The appellant contended that the trial miscarried because the jury were not warned by the trial judge against using tendency reasoning. Because the appellant's counsel had not sought a direction to that effect at trial, the appellant required leave to raise this ground pursuant to r 4 of the Criminal Appeal Rules (NSW). The Court of Criminal Appeal refused leave to appeal on that ground. Beech-Jones J (with whom Adamson J agreed) held that there was no absolute requirement, or even a presumption, that an anti-tendency direction must be given in every case in which multiple counts of sexual assault involving different complainants are tried together and where the evidence in respect of the counts is not admitted as tendency evidence. His Honour observed that whether a miscarriage of justice is occasioned by a failure to give an anti-tendency direction depends on the extent of the risk that the jury will engage in tendency reasoning. The assessment of that risk will be informed by an analysis of the parties' respective cases and how they were conducted, the effect of other directions given, and whether counsel sought an anti-tendency direction15. Beech-Jones J concluded that, in the circumstances, the combined effect of the separate consideration direction and the Murray direction was sufficient to ensure that the jury understood that each of the First Child, the Third Child and the Fifth Child was the "only witness" to the events comprising each count relating to each child, so that the risk of the jury having engaged in tendency reasoning was substantially diminished16. Beech-Jones J said17: "Most significantly, the Murray direction precluded a juror from reasoning that they could convict the [appellant] on any count concerning a particular child even though they had doubts about the honesty and accuracy of the evidence of that child because of their acceptance of the evidence of another child and what that evidence might demonstrate about the [appellant's] tendencies or propensity. The effect of the Murray direction was that, unless the jury were positively satisfied that the relevant child was an honest and accurate witness, then they could not convict the [appellant] on the counts that related to that child." 15 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [113]. 16 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [115]. 17 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [117]. His Honour acknowledged that, nevertheless, there remained "at least a theoretical risk"18 that the jury might reason from their acceptance of the evidence of one complainant, to the view that the appellant was the type of person who would commit the offences with which he was charged, and then to conclude that the evidence of another complainant in relation to similar offending was honest and accurate. However, in his Honour's view, in the context where a Murray direction had been given, this risk was not sufficiently material such that the failure to warn against tendency reasoning was a miscarriage of justice19. In so concluding, his Honour considered it was relevant that the appellant's trial counsel had not sought an anti-tendency direction, and that this was, in his Honour's view, clearly a deliberate decision by the appellant's trial counsel "in the sense that he did not consider that such a direction was necessary given the Murray direction and the manner in which the defence case was put"20. Beech-Jones J also considered that the nature of the defence case of concoction and the various straightforward paths of reasoning towards guilt available to the jury meant there was little practical risk that the jury might embark upon the circuitous route of tendency reasoning. In this regard, his Honour said21: "Given the defence case that the children were party to an orchestrated campaign of lies, the most likely paths of reasoning that were adverse to the [appellant] and consistent with the directions given to the jury did not involve tendency reasoning. These paths of reasoning were a rejection of the existence of any such manipulation by the [appellant's] ex-wife and a separate assessment of each child's evidence to the effect that they were honest and reliable, or an acceptance of the honesty and reliability of the evidence of one child as a basis for rejecting the [appellant's] evidence which might then impact on an assessment of the honesty and reliability of the evidence of the other children. Neither of those paths of reasoning involves tendency reasoning." Macfarlan JA, in dissent, considered that there was a "significant risk" that the jury would engage in impermissible tendency reasoning so that the absence of 18 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [118]. 19 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [118], [120]. 20 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [119]. See also [113]. 21 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [120]. an anti-tendency direction rendered the trial unfair22. Macfarlan JA reasoned that a ruling against the cross-admissibility of evidence relating to multiple counts would ordinarily result in an order for separate trials, because of the difficulty of confining the jury to permissible non-tendency reasoning23, and since that had not occurred, it was incumbent on the trial judge to attempt to ameliorate, as far as possible, the potential prejudice to the appellant by the giving of appropriate directions24. In his Honour's view, the Murray direction was insufficient to avoid such prejudice, not least because it did not rule out the possibility of the jury employing tendency reasoning as between counts relating to the same complainant25. The appellant's submissions The appellant submitted that the key issue in the trial – whether the complainants' evidence as to the sexual assaults committed upon them should be accepted – was the kind of issue where the risk of impermissible tendency reasoning was high. Because that was so, the appellant submitted, the absence of an invitation from either counsel at trial to the jury to engage in tendency reasoning was of no moment. The risk was that the jury may be naturally inclined to engage in tendency reasoning unless they were clearly directed against that course by positive steps. The appellant submitted that Beech-Jones J erred in proceeding on the footing that there was no requirement of law that an anti-tendency direction should always be given where multiple sexual offences are charged and where tendency reasoning is not permissible. The appellant submitted that his Honour was wrong to distinguish the observations of McHugh J in KRM v The Queen26 to the effect 22 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [39]-[40], [54]. 23 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [42], citing De Jesus v The Queen (1986) 61 ALJR 1 at 2-3; 68 ALR 1 at 3-5; Sutton v The Queen (1984) 152 CLR 528 at 531, 539, 542-544, 561, 569; Hoch v The Queen (1988) 165 CLR 292 at 294; R v Bauer (a pseudonym) (2018) 266 CLR 56 at 99 [88]; Decision restricted [2019] NSWCCA 166 at [184], [196]; Hamalainen v The Queen [2019] NSWCCA 276; Hughes v The Queen (2017) 263 CLR 338 at 402-403 [171]-[172]. 24 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [43]. 25 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [45]-[46]. (2001) 206 CLR 221 at 233-235 [32]-[38]. that, in cases involving a trial on multiple counts of sexual offences against multiple complainants, a tendency warning "will almost certainly be required". In this regard, the appellant relied on the observations of Brennan J in Sutton v The "When two or more counts constituting a series of offences of a similar character are joined in the same information, a real risk of prejudice to an accused person may arise from the adverse effect which evidence of his implication in one of the offences charged in the indictment is likely to have upon the jury's mind in deciding whether he is guilty of another of those offences. Where that evidence is not admissible towards proof of his guilt of the other offence, some step must be taken to protect the accused person against the risk of impermissible prejudice. Sometimes a direction to the jury is sufficient to guard against such a risk; sometimes it is not. Where a direction to the jury is not sufficient to guard against such a risk, an application for separate trials should generally be granted." One may pause here to recall that, in the present case, a number of directions were given which tended to ameliorate the risk adverted to by Brennan J. The real question is whether, in the circumstances of the case, those directions were sufficient to remove the practical risk that the jury might reason to a conviction on any count by tendency reasoning. The appellant submitted that the separate consideration direction was inadequate to instruct the jury as to what evidence they could consider in relation to each count. First, the appellant noted that a separate consideration direction typically involves two parts: that the jury "must consider each count separately", and that the jury must consider each count "only by reference to the evidence that applies to it"28. The direction given by the trial judge did not contain the second warning and so, in the appellant's submission, did not identify for the jury the evidence available to prove each count. Nor, in the appellant's submission, did the Murray direction identify for the jury, with clarity, the evidence to which they were entitled to have regard in assessing the honesty and reliability of each complainant. Indeed, in the appellant's submission, the Murray direction given in this case was capable of being understood by the jury as an invitation to engage in tendency reasoning across multiple complainants, rather than an admonition against reasoning in that way. In (1984) 152 CLR 528 at 541-542. See also De Jesus v The Queen (1986) 61 ALJR 1 at 3; 68 ALR 1 at 4-5. 28 KRM v The Queen (2001) 206 CLR 221 at 234 [36], 263-264 [132]. any event, the appellant submitted, the Murray direction was ineffective to ward against impermissible tendency reasoning between counts relating to the same complainant. The appellant contended that Beech-Jones J was wrong to infer that the failure of the appellant's trial counsel to request an anti-tendency direction was a deliberate decision made in the belief that such a direction was not necessary in the circumstances. In the appellant's submission, as Macfarlan JA concluded29, it was not possible to form a view whether the appellant's trial counsel made a calculated forensic decision not to seek an anti-tendency direction. It was emphasised that even experienced counsel may make mistakes or be guilty of oversight and omission30. Accordingly, so it was said, the absence of a request for a direction did not relieve the trial judge of his duty to provide appropriate warnings to the jury. The Crown's submissions The Crown submitted that the appellant had not demonstrated that the failure to give an anti-tendency direction gave rise to a miscarriage of justice, because he had not demonstrated that there was a "real chance" that the jury in the present case might have improperly engaged in tendency reasoning31. The Crown submitted that the extent of the risk depends on the issues in the trial, contrasting the present case with cases where the identity of the assailant is in issue and the risk of impermissible tendency reasoning is particularly high. In the Crown's submission, neither the Crown Prosecutor nor the defence invited the jury to engage in tendency reasoning. Nor did any of the directions suggest that tendency reasoning would be permissible. The giving of the character direction, the context direction, the separate consideration direction and the Murray direction sufficiently mitigated the theoretical risk that the jury would employ tendency reasoning. The Crown noted that the omission of the "second limb" of the standard separate consideration direction – to consider each count "only by reference to the evidence that applies to it" – was apt to ensure the defence case was not 29 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [54]. 30 See KRM v The Queen (2001) 206 CLR 221 at 255-256 [101]; Doggett v The Queen (2001) 208 CLR 343 at 382-383 [147]-[148]. 31 See Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [113], citing BRS v The Queen (1997) 191 CLR 275 at 306. undermined, defence counsel having invited the jury to consider all the evidence and to "join the dots" to conclude that each of the complainants was lying. In any event, the Murray direction clearly directed the jury as to the evidence they could use when reasoning towards guilt. A miscarriage of justice? Insofar as the appellant's argument depends upon the proposition that an anti-tendency direction must be given in every case where multiple counts of sexual offences against several complainants involving similar fact evidence are tried together, that submission must be rejected. It is noteworthy that the authorities, including KRM v The Queen32, simply do not support the absolute proposition that a failure to give an anti-tendency direction in such circumstances always constitutes a miscarriage of justice33. It may be accepted, of course, that courts must be astute to protect the accused person against the risk of impermissible tendency reasoning, a risk that is "peculiarly" strong in cases where sexual offences are alleged34. As Macfarlan JA observed, in a sexual assault case, as a matter of "ordinary human experience"35, it may be natural for the jury to use conclusions about one or more charged offences to assist them in deciding whether another charged offence was committed. But there is no absolute rule that in such cases the risk of impermissible tendency reasoning is such as always to necessitate the giving of an anti-tendency direction. The risk of tendency reasoning is not present in every case to the same extent; rather, the extent of the risk will depend upon the issues presented by the parties and the other directions given by the trial judge. As the Crown suggested, the risk may be higher where, for example, the issue is as to the identity of the offender and the evidence of identification is circumstantial. Given the issues tendered by the parties to the jury in this case, however, there is an air of unreality in the suggestion that an anti-tendency (2001) 206 CLR 221 at 234-235 [38]. 33 BRS v The Queen (1997) 191 CLR 275 at 308. See also Erohin v The Queen [2006] NSWCCA 102; Toalepai v The Queen [2009] NSWCCA 270; Jiang v The Queen [2010] NSWCCA 277; Lyndon v The Queen [2014] NSWCCA 112. 34 De Jesus v The Queen (1986) 61 ALJR 1 at 3; 68 ALR 1 at 4-5. 35 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [40], citing R v Bauer (a pseudonym) (2018) 266 CLR 56 at 83 [51]. See also HML v The Queen (2008) 235 CLR 334 at 423 [272]. direction was necessary to ensure that the jury did not reason to guilt by reliance on tendency reasoning. The defence case put at front of mind for the jury the appellant's contention that each complainant was lying about the counts on the indictment that concerned the particular complainant. Each complainant was said to be concocting his or her evidence as part of a conspiracy against the appellant. Counsel for the defence, in his closing address, submitted to the jury that "[a]ll you are concerned [with] is as to whether you can find beyond reasonable doubt that [the prosecution] witnesses are reliable". True it is that, as a matter of law, the rejection of the defence case of concoction did not mean that the appellant was, ipso facto, guilty on any count. But there can be little doubt that in the present case the issue of credibility as between the appellant on the one hand, and each of the complainants and their mother on the other hand, was overwhelmingly likely to be decisive of the appellant's guilt on any count. And confronted with such a stark contest of credibility, to reject the defence case of concoction was a legitimate path of reasoning which was consistent with the Murray direction that the jury could convict in respect of a count only if they were satisfied beyond reasonable doubt as to the reliability of the evidence of the complainant in respect of that count. That path of reasoning did not stray into tendency reasoning. If the jury were to accept that the evidence of each complainant was honest and reliable, the jury would have no occasion to resort to tendency reasoning to bolster the evidence of an unconvincing complainant by reference to a finding of guilt in respect of another complainant. The Murray direction was clear, and it had the force of simplicity. Given the directions that the jury were actually given by the trial judge, it was distinctly unlikely that they would reason that a doubt about the reliability of any complainant in relation to any one complaint might be resolved by reasoning that the appellant was the kind of person who was disposed to engage in such conduct based on the evidence in relation to other counts. Further in this regard, the Crown was scrupulous to put its case to the jury with the evidence of each of the complainants, and the arguments in favour of accepting that evidence as honest and reliable, summarised separately as to each complainant and as to each count. The Crown's response to the appellant's attack upon the credibility and reliability of the complainants was put to the jury in the following terms: "Of course, if you believe that [the accused] is telling you the truth, that he did not commit these offences, then clearly the Crown has not established its case. Even if you do not positively believe [the accused], but what he says gives you a reasonable doubt as to whether he did commit these offences, then you could not be satisfied beyond a reasonable doubt that he did, in fact, commit the offences. What the Crown says to you though is this. You would reject [the accused's] evidence entirely and you would reject it on critical issues involving his children and once you reject him in the way in which he dealt with his children, whether it be physically or decently, you put his evidence to one side and you go back to the Crown case and you work out whether you're satisfied that those three children told you the truth." The Crown case was focussed upon the credibility and reliability of the complainants in light of evidence including the aggression evidence and the rugby ball incident evidence. The Crown case invited the jury to follow an orthodox path of reasoning to conviction, which made the risk that the jury might instead detour into tendency reasoning distinctly remote. Forensic advantage? A rational decision by defence counsel as to the conduct of a criminal trial that can be seen to have been a legitimate forensic choice that competent counsel could fairly make will not give rise to a miscarriage of justice within s 6(1) of the Criminal Appeal Act36. The adversarial system does justice through the diligent exertions of competent counsel in coming to grips with the special circumstances of the particular case. It might be suggested that the failure by defence counsel to seek a direction, the fundamental premise of which is that the jury might accept the evidence of a complainant on one count, reflects a choice on the part of the appellant's representatives to give no countenance to even the possibility that the appellant might be convicted on any count, given the stark contest of credibility that the defence case presented to the jury. It might also be suggested that the appellant's case was unequivocally that the allegation that he had sexually assaulted any of his children on any occasion was a wicked lie. It might have been thought that the forensic strategy that the defence actually pursued was the only strategy that would, if successful, result in acquittals on all counts. Bold though such a forensic strategy may seem, in the course of human experience it is not unknown for bold strategies to fail. It is not, however, necessary to pursue any of these speculations further. In the Court of Criminal Appeal, Beech-Jones J was not satisfied that the failure of 36 TKWJ v The Queen (2002) 212 CLR 124 at 130-131 [16], 133-134 [26]-[31], the defence at trial to seek an anti-tendency direction was explicable in terms of the pursuit of forensic advantage37. It was, of course, theoretically possible for the trial judge to give an anti-tendency direction while at the same time reminding the jury of the defence case that they should scrutinise the evidence of all the complainants and their mother and so discern indications of concoction. But the issue is not about what was theoretically possible or even what might have been prudent. The issue is whether the extent of the risk of impermissible tendency reasoning as a pathway to verdicts of guilty was such as to require an anti-tendency direction to obviate that risk in the circumstances of this case. If the jury were to entertain a doubt as to whether even one of the complainants was a reliable witness, then they might well have been disposed to entertain the possibility that all the complainants' evidence was concocted. On the other hand, if the jury were satisfied beyond reasonable doubt that the evidence of each complainant was honest and reliable in accordance with the separate consideration direction and the Murray direction, then there would simply be no occasion for the jury to resort to tendency reasoning. The Murray direction, which the appellant's counsel had secured, meant that the jury were focussed on whether any of the complainants might not be honest and reliable. If, with that focus, the jury were satisfied that each complainant was honest and reliable, verdicts of guilty would follow directly. But in no case would a conviction on any count follow from reasoning that doubts about the honesty and reliability of any complainant could be resolved in favour of conviction by tendency reasoning. A deliberate decision and its significance Within our system of justice, save for exceptional cases, "parties are bound by the conduct of their counsel, who exercise a wide discretion in deciding what issues to contest, what witnesses to call, what evidence to lead or to seek to have excluded, and what lines of argument to pursue"38. While it is true that, as Kiefel CJ, Bell, Gageler and Gordon JJ said in De Silva v The Queen39: 37 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [122]. 38 Nudd v The Queen (2006) 80 ALJR 614 at 618 [9]; 225 ALR 161 at 164; R v Baden-Clay (2016) 258 CLR 308 at 324 [48]. (2019) 268 CLR 57 at 70 [35]. "[t]he failure of counsel to seek a direction is not determinative against successful challenge in a case in which the direction was required to avoid a perceptible risk of the miscarriage of justice", their Honours went on to say: "The absence of an application for a direction may ... tend against finding that that risk was present." The majority of the Court of Criminal Appeal were right to conclude that the failure of the appellant's counsel at trial to seek an anti-tendency direction was a deliberate decision based on the circumstance "that he did not consider that such a direction was necessary"40 to ensure a fair trial of the appellant. Indeed, this is clearly the better view. There is no reason to doubt the competence of defence counsel. Indeed, it may be said that he conducted his client's case with considerable success. He resisted, successfully, the Crown's tendency application. And, as has been seen, in the course of the trial judge's summing-up, when defence counsel was afforded the opportunity to consider whether further directions were required, he did not seek an anti-tendency direction in respect of the counts on the indictment but rather pressed – again successfully – his application for the Murray direction, which was ultimately given by the trial judge. In these circumstances, the suggestion that defence counsel failed to seek an anti-tendency direction as a result of oversight on his part is fanciful. One can be confident that the appellant's counsel at trial did not seek an anti-tendency direction for the reason that he perceived that, in light of the directions that were given to the jury and the stark choice presented to the jury by the parties, there was little practical risk that the jury would reason to verdicts of guilty via the impermissible path of tendency reasoning. The Court of Criminal Appeal had no reason to reach a different assessment of that risk, and neither does this Court. While it is true that the rejection of the defence case of concoction would not mean, ipso facto, that the appellant was guilty on all ten counts, the straightforward path of reasoning by which the jury would accept the evidence of each complainant (and their mother) as honest and reliable beyond reasonable doubt was such as to render recourse to the circuitous path of tendency reasoning a theoretical risk only. 40 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [119]. Conclusion and order The majority of the Court of Criminal Appeal were right to refuse the appellant leave to appeal on the ground argued in this Court. The appeal should be dismissed. Edelman Gleeson EDELMAN AND GLEESON JJ. The relevant facts concerning the prosecution and defence cases and the course of the trial are set out in the judgment of Kiefel CJ, Keane and Steward JJ. We also gratefully adopt their Honours' description of the reasoning of the New South Wales Court of Criminal Appeal. The issue is whether, by reason of the trial judge's failure to give the anti-tendency direction, "on any other ground whatsoever there was a miscarriage of justice" within the meaning of s 6(1) of the Criminal Appeal Act 1912 (NSW). The appellant contends that he was deprived of his entitlement to a trial in which the relevant law was correctly explained to the jury, and that this was a miscarriage of justice41. The law relevantly included that evidence admitted for one purpose is not admissible for another purpose, and cannot be used for another purpose42. In Sutton v The Queen43, Brennan J explained the rationale for this rule as follows: "[I]n a criminal trial evidence of the commission of offences other than the offence charged is prima facie inadmissible against an accused person. The chief reason for the prima facie inadmissibility of evidence of an offence other than the offence charged is this: it is thought that the antipathy which evidence of another offence is apt to engender may unjustly erode the presumption of innocence which protects an accused person at his trial; ie, the evidence of the other offence may be regarded by the jury as being more probative of guilt of the offence charged than it can fairly be thought to be." "[C]riminal courts take it as axiomatic that, where the evidence reveals the criminal convictions or propensity of the accused, there is a real risk that the jury will reason towards guilt by using the conviction or propensity."44 The risk arises because such evidence would ordinarily be regarded as relevant and because it is thought that juries are likely to attach importance (and, indeed, too much importance) to such evidence45. Thus, the concern to be addressed is the prospect 41 Mraz v The Queen (1955) 93 CLR 493 at 514; Weiss v The Queen (2005) 224 CLR 42 BRS v The Queen (1997) 191 CLR 275 at 294, quoting B v The Queen (1992) 175 CLR 599 at 607-608. (1984) 152 CLR 528 at 545. 44 BRS v The Queen (1997) 191 CLR 275 at 308. 45 Perry v The Queen (1982) 150 CLR 580 at 585; Gilbert v The Queen (2000) 201 CLR 414 at 420 [13]; Hughes v The Queen (2017) 263 CLR 338 at 365-366 Edelman Gleeson that a jury, applying ordinary reasoning, might engage in tendency reasoning unless discouraged46. The law's acceptance that propensity reasoning will often be highly prejudicial is reflected in s 97 of the Evidence Act 1995 (NSW), which conditions the admissibility of evidence of "the character, reputation or conduct of a person, or a tendency that a person has or had" to prove that the person has or had a tendency to act in a particular way, on a requirement of "significant probative value". The difficulty of mitigating the risk was expressed graphically by Lord Cross of Chelsea, who, in Director of Public Prosecutions v Boardman47, observed that a trial involving multiple complainants would require the jury to "perform mental gymnastics" by directions to the effect that "in considering whether the accused is guilty of the offence alleged against him by A they must put out of mind the fact – which they know – that B and C are making similar allegations against him". The risk of tendency reasoning was increased in this case because the trial did not merely involve multiple complainants48, but alleged conduct that may have suggested to a jury tendencies of paedophilic and incestuous attraction on the part of the appellant. In such circumstances, an anti-tendency warning has been said to be "particularly important"49. Separate trials in relation to the allegations of each complainant would have avoided the real and well-recognised risk that the jury could reason towards guilt in respect of offences against one child by reference to evidence of offences against 46 See McClellan, "Who is telling the truth? Psychology, common sense and the law" (2006) 80 Australian Law Journal 655 at 657. [1975] AC 421 at 459. More recently, in Hughes v The Queen (2017) 263 CLR 338 at 403 [172], Nettle J concluded, in a trial involving multiple allegations of sexual assault and multiple complainants, that the process of reasoning that would have been required of a properly directed jury was so complex as to have required two separate trials. 48 KRM v The Queen (2001) 206 CLR 221 at 254 [97]. 49 T (1996) 86 A Crim R 293 at 299. See also Hughes v The Queen (2017) 263 CLR Edelman Gleeson another child50. However, the appellant chose to have a single trial because an important aspect of his defence was that the allegations were concocted. The defence argued that the complainants had "put stories together", poisoned by their mother so that she could both maximise her position in proceedings in the Family Court of Australia against the appellant and inflict upon him as much pain as possible. In order to make good that case, the appellant wished to have a single trial of all the charges. Having determined upon a single trial, the "most obvious danger [was] that a jury, unless adequately warned, and perhaps even if given the strongest warning, [would] find irresistible the temptation to use the evidence relevant to one set of charges as an aid to reaching a conclusion in relation to another set of charges"51. Thus, in KRM v The Queen52, McHugh J expressed the opinion that, in the case of a single trial of alleged offences against different victims where the evidence in respect of one or more counts is inadmissible in respect of the other counts, "a propensity warning will almost certainly be required". In Roach v The Queen53, the plurality stated: "The importance of directions in cases where evidence may show propensity should not be underestimated. It is necessary in such a case that a trial judge give a clear and comprehensible warning about the misuse of the evidence for that purpose and explain the purpose for which it is tendered. A trial judge should identify the inferences which may be open from it or the questions which may have occurred to the jury without the evidence. Those inferences and those questions should be identified by the prosecution at an early point in the trial." The obvious danger of impermissible tendency reasoning in the appellant's trial required mitigation unless there was no real risk that the jury might convict 50 See Director of Public Prosecutions v Boardman [1975] AC 421 at 459; Sutton v The Queen (1984) 152 CLR 528 at 531, 541-542; De Jesus v The Queen (1986) 61 ALJR 1 at 3; 68 ALR 1 at 4-5. 51 R v Johnson (unreported, New South Wales Court of Criminal Appeal, 23 July 1990). (2001) 206 CLR 221 at 235 [38]. (2011) 242 CLR 610 at 625 [47]. Edelman Gleeson the appellant by a chain of impermissible reasoning54. There was a miscarriage of justice in this case if, in the absence of the anti-tendency direction, there is a real and not fanciful risk that the jury might have used propensity reasoning to find the appellant guilty55. Assessment of risk of impermissible tendency reasoning It was common ground that there was a risk of impermissible tendency reasoning in this case. The respondent accepted that the risk was of a sufficient magnitude to have compelled separate trials if they had been sought by the appellant. The starting point is the "axiomatic" proposition that where the evidence may have revealed to the jury a propensity to offend, there was a real risk that the jury would reason towards guilt by using the identified propensity. The risk necessarily arose in this case because there was a joint trial of charges involving multiple complainants. The risk was exacerbated by reason of the nature of the particular charges, involving, as they did, sexual offences against three of the appellant's five children. The risk was further exacerbated because of the particular nature of the alleged offences involving the third and fifth children, demonstrated by the trial judge's finding as to the significant probative value of the evidence of those children for the purposes of s 97 of the Evidence Act. Although the prosecution did not suggest tendency reasoning to the jury from the outset (its tendency evidence application being undecided), nor did it proceed in the manner advocated by Roach v The Queen56, namely by identifying the inferences which may be open from evidence of multiple offences against multiple complainants at an early point in the trial and dispelling those inferences. Consistent with the determination of the tendency application after the complainants' evidence had been adduced, no directions were given by the trial judge limiting the use of the evidence of any single complainant prior to, or 54 BRS v The Queen (1997) 191 CLR 275 at 306. See also KRM v The Queen (2001) 206 CLR 221 at 234 [37]. 55 BRS v The Queen (1997) 191 CLR 275 at 302, 308, 330; Gipp v The Queen (1998) 194 CLR 106 at 166 [175]. See also Erohin v The Queen [2006] NSWCCA 102 at [68]; Toalepai v The Queen [2009] NSWCCA 270 at [46], [49]; Jiang v The Queen [2010] NSWCCA 277 at [44]; Lyndon v The Queen [2014] NSWCCA 112 at [63]. (2011) 242 CLR 610 at 625 [47]. Edelman Gleeson immediately following, that evidence being given57. This aspect of the course of the trial left the jury open to the significant temptation, as the trial proceeded, of using the evidence of the charges concerning each complainant in its evaluation of the evidence of each of the other complainants. The matters identified above point to a high risk of tendency reasoning by the jury, unless otherwise instructed. Although the risk might have been effectively addressed by directions of the general kind given by the trial judge to the jury, the directions in this trial did not achieve that result58. In particular, the separate consideration direction given by the trial judge59 did not follow the common language of such a direction, as stated by McHugh J in KRM v The Queen60, in that it omitted words to the effect that the jury must consider each count only by reference to the evidence that applies to the count. The respondent submitted that the separate consideration direction was adapted to take into account the defence case of concoction. Even if this be true, the direction given to the jury in this case failed to convey what evidence was relevant to each count and what evidence was not to be used in the course of giving separate consideration to each count. The direction did not effectively address the risk that the jury would reason towards guilt in relation to the counts concerning one complainant by reference to the evidence of the other complainants. The trial judge gave a Murray direction61, that is, a direction based on the following statement in R v Murray62, approved in Robinson v The Queen63: "In all cases of serious crime it is customary for judges to stress that where there is only one witness asserting the commission of the crime, the evidence of that witness must be scrutinised with great care before a 57 cf R v Beserick (1993) 30 NSWLR 510 at 516. 58 cf R v J [No 2] [1998] 3 VR 602 at 639; R v Robertson [1998] 4 VR 30 at 40. 59 See Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [35]. (2001) 206 CLR 221 at 234 [36]. See also R v Markuleski (2001) 52 NSWLR 82 at 61 See Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [104]. (1987) 11 NSWLR 12 at 19. (1999) 197 CLR 162 at 168-169 [21]. See also Tully v The Queen (2006) 230 CLR Edelman Gleeson conclusion is arrived at that a verdict of guilty should be brought in; but a direction of that kind does not of itself imply that the witness' evidence is unreliable." The Murray direction required the jury to accept the honesty and accuracy of each complainant and to scrutinise their evidence carefully before convicting the appellant of an offence against that complainant. However, the direction did not address, explicitly or implicitly, the risk of tendency reasoning from the evidence of one complainant to the guilt of the appellant of an offence against another complainant. Further, it did not conform to the trial judge's earlier instruction to give separate consideration to separate counts, and it did not indicate that the jury must not have regard to the evidence of offences against the other complainants in assessing the honesty and accuracy of each complainant. To the contrary, the Murray direction was expressed in a manner which may have positively encouraged the jury to consider the honesty and accuracy of the complainants collectively (by instructing the jury that "unless you are satisfied beyond a reasonable doubt that [the first child], [the third child], and [the fifth child] are both honest and accurate witnesses in the accounts that they have given you cannot find the accused guilty. Before you could convict the accused you should examine the evidence of the complainants very carefully"). While it may be accepted that the trial judge's directions to the jury did not positively encourage impermissible tendency reasoning, they did not discourage the misuse of the evidence of the various complainants and, accordingly, did not reduce the risk of impermissible reasoning. Beech-Jones J's postulated paths of reasoning are the likely ones but, having regard to the overall conduct of the trial, that is insufficient to support a conclusion that there was no real risk of impermissible tendency reasoning by the jury in this case. That conclusion is in conformity with the result in BRS v The Queen64, in which this Court concluded that the accused had been denied a fair trial, with McHugh J observing that the "only basis for concluding that the jury may have used a forbidden chain of reasoning in reaching its verdict" was the axiomatic proposition that there was a real risk of propensity reasoning in the face of evidence of propensity. Finally, it is necessary to consider the significance of the fact that the appellant's counsel did not seek an anti-tendency direction. Beech-Jones J correctly observed that the failure of defence counsel to seek an anti-tendency direction can affect an assessment of the relevant risk65. However, the failure of (1997) 191 CLR 275 at 308. 65 Hamilton (a pseudonym) v The Queen [2020] NSWCCA 80 at [113]. Edelman Gleeson counsel to seek the anti-tendency direction is not determinative if the direction was required in order to avoid a perceptible risk of miscarriage of justice66. Deliberate forensic choices of the appellant's counsel did not relieve the trial judge of the responsibility to give such directions as were required by law67. In this Court, the respondent conceded that it would have been possible for the trial judge to give an asymmetrical anti-tendency direction, that is, a direction that would not have cut across the appellant's concoction case to the extent that it might have relied upon tendency reasoning. More precisely, the direction would have instructed the jury that in considering the defence case, the jury was free to consider all of the evidence, but that in considering the prosecution case, the jury was limited to considering identified evidence in support of each count sequentially. Conclusion For these reasons, the Court of Criminal Appeal erred in failing to identify the real risk of conviction by impermissible reasoning in circumstances where the jury was not explicitly warned that the evidence of each complainant was not relevant to the charges concerning each of the other complainants, or that the evidence of offences against one complainant must not be treated as tending to prove that the appellant was guilty of any offence against another complainant or to prove an inclination in the appellant towards the alleged offending conduct. In the Court of Criminal Appeal, the respondent did not submit that, if there was a miscarriage of justice, the proviso in s 6(1) of the Criminal Appeal Act could be applied. We would allow the appeal, set aside the orders of the Court of Criminal Appeal made on 27 April 2020 and, in their place, order that leave to appeal on ground 1 be granted, the appeal be allowed, the appellant's convictions be quashed, and a retrial be ordered. 66 De Silva v The Queen (2019) 268 CLR 57 at 70 [35]. See also BRS v The Queen (1997) 191 CLR 275 at 294-295, 302; KRM v The Queen (2001) 206 CLR 221 at 67 BRS v The Queen (1997) 191 CLR 275 at 302, 306, 328.

HIGH COURT OF AUSTRALIA CONNECTIVE SERVICES PTY LTD & ANOR APPELLANTS AND SLEA PTY LTD & ORS RESPONDENTS Connective Services Pty Ltd v Slea Pty Ltd [2019] HCA 33 9 October 2019 ORDER Appeal dismissed. The appellants pay the costs of the first and second respondents. On appeal from the Supreme Court of Victoria Representation D F Jackson QC with D G Guidolin for the appellants (instructed by Quinn Emanuel Urquhart & Sullivan) J T Gleeson SC with K E Foley and G C Kozminsky for the first and second respondents (instructed by Arnold Bloch Leibler) Submitting appearances for the third and fourth respondents Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Connective Services Pty Ltd v Slea Pty Ltd Companies – Shares – Implied prohibition against financial assistance by company to acquire shares in company – Meaning of "financial assistance" – Where s 260A(1) of Corporations Act 2001 (Cth) provides that company may financially assist a person to acquire shares in the company only if giving the assistance does not materially prejudice the interests of the company or its shareholders, or the company's ability to pay its creditors – Where appellant companies' constitutions contained pre-emption clause which provided that, before a shareholder could transfer shares of a particular class, those shares must first be offered to existing shareholders of that class in proportion to the number of shares of that class already held by that shareholder – Where sole shareholder of one shareholder company entered into agreements for sale of shares – Where appellant companies claimed that agreements breached pre-emptive rights provisions – Where injunction sought under s 1324 of Corporations Act to restrain appellant companies from prosecuting proceedings in relation to pre-emptive rights on basis that proceedings contravened the prohibition against financial assistance in s 260A(1) – Whether funding by company of legal proceedings directed at compelling one shareholder to offer shares to other shareholders is financial assistance – Whether the companies should be enjoined from continuing legal proceedings at their expense to vindicate alleged breach of pre-emptive rights. Words and phrases – "acquisition of shares", "creditors", "financial assistance", "implied prohibition against financial assistance", "injunction", "material prejudice", "power to enforce company constitution", "pre-emptive rights", "shareholders". Corporations Act 2001 (Cth), ss 260A(1), 1324(1). KIEFEL CJ, GAGELER, KEANE, GORDON AND EDELMAN JJ. Introduction In Trevor v Whitworth1, Lord Macnaghten said that "[i]f shareholders think it worth while to spend money for the purpose of getting rid of a troublesome partner who is willing to sell, they may put their hands in their own pockets and buy him out, though they cannot draw on a fund in which others as well as themselves are interested". That concern with maintenance of corporate capital was extended by statutory provisions which provided protection for shareholders and creditors from a company giving financial assistance to acquire its shares. This appeal concerns the scope of the implied prohibition in s 260A(1) of the Corporations Act 2001 (Cth) against financial assistance by a company to acquire shares in the company where the financial assistance is said to materially prejudice the interests of the company or its shareholders. The question on this appeal is whether the appellant companies should be enjoined from continuing legal proceedings at their expense to vindicate alleged pre-emptive rights of their shareholders to be offered for purchase shares in the companies, which rights the companies allege have been breached. For the reasons below, the Court of Appeal of the Supreme Court of Victoria was correct to conclude that s 260A(1) was contravened and that an injunction must issue. Background In 2003, the two appellant companies (which can be described collectively as "the Connective companies") were incorporated to conduct a mortgage aggregation business. At all relevant times, the shareholders in the Connective companies have been: (i) the first respondent (Slea Pty Ltd, "Slea") with 33.33%; (ii) the third respondent (Millsave Holdings Pty Ltd, "Millsave") with 50%; and (iii) the fourth respondent ("Mr Haron") with 16.67%. Since 2011, the directors of the Connective companies have been Mr Haron, Mr Lees (who is associated with Millsave), and Mr Maloney. The constitution of each Connective company contained an identical pre- emption clause ("the pre-emptive rights provisions"). In broad terms, the pre- emptive rights provisions required that before a shareholder could transfer shares of a particular class, those shares must first be offered to existing shareholders of (1887) 12 App Cas 409 at 436. that class in proportion to the number of shares of that class already held by that shareholder. In May 2009, the sole director and sole shareholder of Slea, Mr Tsialtas, entered an agreement with the second respondent (Minerva Financial Group Pty Ltd, "Minerva") for the sale of Mr Tsialtas' shares in Slea ("the 2009 Agreement"). Shortly afterwards, Mr Tsialtas disclosed the existence of the 2009 Agreement to the Connective companies. There is a dispute about whether the 2009 Agreement has been terminated by Mr Tsialtas, as Slea and Minerva claim. In August 2010, Slea, Minerva and Mr Tsialtas entered a second agreement, entitled "Accommodation Agreement". In December 2011, in Slea's amended defence to a separate proceeding brought by Mr Haron, the existence of the Accommodation Agreement was disclosed to Mr Haron, the Connective companies, and Millsave. Slea also disclosed the Accommodation Agreement in an oppression proceeding against Mr Haron, the Connective companies, and Millsave. companies On 11 August 2016, the Connective companies instituted proceedings against Slea and Minerva, also joining Millsave and Mr Haron as defendants ("the pre-emptive rights proceeding"). In the pre-emptive rights proceeding the Connective the that Accommodation Agreement breached the pre-emptive rights provisions, and alleged that Slea intended, and still intends, to transfer its shares in the Connective companies to Minerva without complying with the pre-emptive rights provisions. The relief sought by the Connective companies included an order to compel Slea to offer its shares in the Connective companies to Millsave and Mr Haron in accordance with the pre-emptive rights provisions. the 2009 Agreement claimed and On 4 October 2016, Slea and Minerva applied by summons to have the pre-emptive rights proceeding dismissed or stayed. One form of relief sought by Slea and Minerva was an injunction under s 1324 of the Corporations Act to restrain the Connective companies from prosecuting the pre-emptive rights proceeding on the basis that by doing so they were in contravention of the implied prohibition against financial assistance in s 260A(1) of the Corporations Act. It is that application that is the subject of this appeal. The prohibition against financial assistance The background to s 260A(1) of the Corporations Act The statutory prohibition against financial assistance was introduced in the United Kingdom in 1929 following a recommendation from the Company Law Amendment Committee, headed by Lord Greene2. The Greene Committee expressed concern about a practice, which it described as "highly improper"3, by which a company provided money for the purchase of its own shares. The Greene Committee recommended that "companies should be prohibited from directly or indirectly providing any financial assistance in connection with a purchase (made or to be made) of their own shares by third persons, whether such assistance takes the form of loan, guarantee, provision of security, or otherwise"4. This recommendation was adopted in the United Kingdom in the Companies Act 1929 (UK)5. The statutory prohibition went further than the rule, reiterated in the decision of the House of Lords in Trevor v Whitworth6, that a corporation cannot "traffic" in its own shares. The rule in Trevor v Whitworth was concerned with capital maintenance but the rationale for the statutory prohibition came to be understood as operating on a wider basis of protecting against abuse of the rights of the company's creditors and shareholders, particularly minority shareholders7. 2 Great Britain, Report of the Company Law Amendment Committee (1926) Cmd 2657 ("the Greene Committee") at 14 [31]. 3 Great Britain, Report of the Company Law Amendment Committee (1926) Cmd 2657 at 14 [30]. See also In re V G M Holdings Ltd [1942] Ch 235 at 239. 4 Great Britain, Report of the Company Law Amendment Committee (1926) Cmd 2657 at 14 [31]. 5 Companies Act 1929 (UK), s 45(1). (1887) 12 App Cas 409 at 416-417, 423-424, 433, 436. 7 Great Britain, Board of Trade, Report of the Company Law Committee (1962) Cmnd 1749 ("the Jenkins Committee") at 62 [173]; Dempster v National Companies and Securities Commission (1993) 9 WAR 215 at 267. See also Austin and Ramsay, Ford, Austin and Ramsay's Principles of Corporations Law, 17th ed From 1931, when the United Kingdom provisions were first adopted in State legislation in Australia8, until the form of the present prohibition was introduced into the Corporations Law in 19989, the prohibition underwent a process of refinement, including in response to the Jenkins Committee in the United Kingdom and judicial decisions10. The immediate predecessor provision to s 260A of the Corporations Law (which became s 260A of the Corporations Act) was s 205(1) of the Corporations Law11. In broad terms, and with exceptions, that provision prohibited a company from "directly or indirectly" giving financial assistance "for the purpose of, or in connection with ... the acquisition by any person", or the "proposed acquisition by any person", of shares or units of shares in the company. In Charterhouse Investment Trust Ltd v Tempest Diesels Ltd12, Hoffmann J considered the terms of the offence in s 54 of the Companies Act 1948 (UK), which was in relevantly similar terms to s 205(1) of the Corporations Law. Hoffmann J explained that there were "two elements"13 to that offence: (i) the giving of financial assistance, and (ii) "that it should have been given 'for the purposes of or in connection with' ... a purchase of shares". The focus of Hoffmann J was only upon the first element, financial assistance, because, as he explained, without financial assistance the second element of "the purpose and 8 Companies Act 1931 (Qld), s 57(1). See also Companies Act 1934 (SA), s 62(1); Companies Act 1936 (NSW), s 148(1); Companies Act 1938 (Vic), s 45(1); Companies Act 1943 (WA), s 59(2); Companies Act 1959 (Tas), s 55(1), (2). 9 Company Law Review Act 1998 (Cth), Sch 1. 10 See Fletcher, "Financial Assistance around the Pacific Rim" (2006) 6 Oxford University Commonwealth Law Journal 157 at 162. 11 Corporations Law, s 205(1), set out in Corporations Act 1989 (Cth), s 82. Applied by Corporations (New South Wales) Act 1990 (NSW), s 7; Corporations (Victoria) Act 1990 (Vic), s 7; Corporations (South Australia) Act 1990 (SA), s 7; Corporations (Queensland) Act 1990 (Qld), s 7; Corporations (Western Australia) Act 1990 (WA), s 7; Corporations (Tasmania) Act 1990 (Tas), s 7. 12 [1986] BCLC 1. 13 [1986] BCLC 1 at 10. See also British and Commonwealth Holdings Plc v Barclays Bank Plc [1996] 1 WLR 1 at 14-15; [1996] 1 All ER 381 at 395-396; Chaston v SWP Group Plc [2003] 1 BCLC 675 at 682 [17]. the connection would not be important"14. The element of purpose or connection did not need to be considered because the defendant, which had sought to resist an action for specific performance on the basis that the agreement contravened s 54, failed to discharge the burden of proving that the transaction involved financial assistance. In focusing upon the meaning of the first element, of "financial assistance", Hoffmann J echoed earlier remarks of Mahoney JA (with whom Samuels JA agreed) in the Court of Appeal of the Supreme Court of New South Wales that the words "financial assistance" are "words of a commercial rather than a conveyancing kind"15. Hoffmann J said that those words "have no technical meaning and their frame of reference is ... the language of ordinary "One must examine the commercial realities of the transaction and decide whether it can properly be described as the giving of financial assistance by the company, bearing in mind that the section is a penal one and should not be strained to cover transactions which are not fairly within it." The approach taken by Hoffmann J to financial assistance was relied upon in numerous cases in Australia under s 205(1) of the Corporations Law and its predecessors18. However, the flexible focus upon "commercial realities" did not 14 [1986] BCLC 1 at 10, quoting Gradwell (Pty) Ltd v Rostra Printers Ltd 1959 (4) SA 419 at 425. 15 Burton v Palmer [1980] 2 NSWLR 878 at 890. 16 [1986] BCLC 1 at 10. See also Chaston v SWP Group Plc [2003] 1 BCLC 675 at 687 [32]; MacNiven v Westmoreland Investments Ltd [2003] 1 AC 311 at 332 [50], quoting British and Commonwealth Holdings Plc v Barclays Bank Plc [1996] 1 WLR 1 at 14; [1996] 1 All ER 381 at 395: "The words 'financial assistance' are not words which have any recognised legal significance". 17 [1986] BCLC 1 at 10. See also Chaston v SWP Group Plc [2003] 1 BCLC 675 at 682-683 [17], 688 [38]; Anglo Petroleum Ltd v TFB (Mortgages) Ltd [2008] 1 BCLC 185 at 191 [27]. 18 See, eg, Dempster v National Companies and Securities Commission (1993) 9 WAR 215 at 274-275; Milburn v Pivot Ltd (1997) 78 FCR 472 at 501; Tallglen Pty Ltd v Optus Communications Pty Ltd (1998) 146 FLR 380 at 385; Wambo (Footnote continues on next page) resolve the conflict in the Australian authorities concerning whether a company's conduct must cause a diminution of the assets of the company before it can amount to financial assistance19. On one view, it was said that such an implication would "ignore the plain language of the Act"20. On another view, it was thought that without an implied restriction, in that form or some related form, the literal terms of the prohibition could extend beyond "the policy reasons [for] the prohibition"21 to ordinary or "innocuous"22 commercial conduct by the company, not falling within an exemption23, that causes no material prejudice to the company, its shareholders, or its creditors. Section 260A of the Corporations Act Section 205 of the Corporations Law was replaced in 199824 by s 260A, which reflected the recommendations of the Corporations Law Simplification Mining Corp Pty Ltd v Wall Street (Holding) Pty Ltd (1998) 28 ACSR 654 at 667- 668; Sterileair Pty Ltd v Papallo (1998) 29 ACSR 461 at 465. 19 Burton v Palmer [1980] 2 NSWLR 878 at 881; Re Myer Retail Investments Pty Ltd and the Companies Act 1981 (1983) 48 ACTR 41 at 49; Darvall v North Sydney Brick & Tile Co Ltd (1987) 16 NSWLR 212 at 246; Darvall v North Sydney Brick & Tile Co Ltd (1989) 16 NSWLR 260 at 297; Re National Mutual Royal Bank Ltd [1992] 1 Qd R 533 at 540; ZBB (Australia) Ltd v Allen (1991) 4 ACSR 495 at 503- 504; R v Roget (1992) 7 WAR 356 at 368; Dempster v National Companies and Securities Commission (1993) 9 WAR 215 at 273-275; Milburn v Pivot Ltd (1997) 78 FCR 472 at 502-503; Tallglen Pty Ltd v Optus Communications Pty Ltd (1998) 146 FLR 380 at 387-388. 20 Darvall v North Sydney Brick & Tile Co Ltd (1989) 16 NSWLR 260 at 291. 21 Dempster v National Companies and Securities Commission (1993) 9 WAR 215 22 Anglo Petroleum Ltd v TFB (Mortgages) Ltd [2008] 1 BCLC 185 at 191 [26]. 23 Compare Companies (Western Australia) Code, s 129(8)(c) with Companies Act 1961 (NSW), s 67(2), discussed in Dempster v National Companies and Securities Commission (1993) 9 WAR 215 at 266-267 and Burton v Palmer [1980] 2 NSWLR 24 Company Law Review Act 1998 (Cth), Sch 1. Task Force25. Section 260A of the Corporations Act, which is materially identical to s 260A of the Corporations Law, relevantly provides as follows: "Financial assistance by a company for acquiring shares in the company or a holding company (1) A company may financially assist a person to acquire shares (or units of shares) in the company or a holding company of the company only if: giving the assistance does not materially prejudice: the interests of the company or its shareholders; or the company's ability to pay its creditors; or shareholders under the assistance section 260B (that section also requires advance notice to ASIC); or is approved by the assistance is exempted under section 260C. Note: For the criminal liability of a person dishonestly involved in a contravention of this section, see subsection 260D(3). Section 79 defines involved." The general purpose of the amendments introduced in s 260A of the Corporations Law was to "improve the substance and the drafting of the current rules, eliminating unnecessary or redundant regulation and making the Law more readily understandable"26. The re-drafted s 260A, like the capital reduction provisions in ss 256B and 257A, was expressed in permissive terms although it contained an implied prohibition. The simplification of s 260A omitted the express references contained in the predecessor provision to a "proposed 25 See Fletcher, "F A, after 75 years" (2005) 17 Australian Journal of Corporate Law 323 at 329; Austin and Ramsay, Ford, Austin and Ramsay's Principles of Corporations Law, 17th ed (2018) at 1812 [24.670]. 26 Australia, House of Representatives, Company Law Review Bill 1997, Explanatory Memorandum at 1 [1.2]. See also Australia, House of Representatives, Parliamentary Debates (Hansard), 3 December 1997 at 11930-11931. acquisition" and to giving financial assistance "directly or indirectly". But the concept of financial assistance remained a commercial notion and, as explained below, despite the omissions the implied prohibition could not have been intended to permit indirect financial assistance or financial assistance for proposed acquisitions. However, important substantive changes were introduced in s 260A, including (i) the introduction of an express requirement that the assistance cause material prejudice to the interests of the company or its shareholders or to the company's ability to pay its creditors, and (ii) an exception for financial assistance that is approved by the shareholders of the company following the procedure in s 260B. The reason for these changes was described in the Explanatory Memorandum as follows27: "This approach is intended to minimise the difficulties the rule currently causes for ordinary commercial In particular, for transactions which do not involve material prejudice, the new rules will make it unnecessary to decide whether the transaction involves the giving of financial assistance. The new rules will bring the requirements for financial assistance more closely into line with those proposed for capital reductions." transactions. Again mirroring the capital reduction provisions in ss 256B and 257A, a focus of the new s 260A was therefore directed towards material prejudice. That express requirement of material prejudice, together with complete exemptions for various conduct in the ordinary course of commercial dealing, thus removed the need for, and controversy surrounding, various implied restrictions to similar effect within the element of "financial assistance". As was the case in relation to its predecessor provisions28, although s 260A(1) is directed at the company, a concern of the statutory prohibition, in 27 Australia, House of Representatives, Company Law Review Bill 1997, Explanatory Memorandum at 73 [12.76]. See also Australia, House of Representatives, Parliamentary Debates (Hansard), 3 December 1997 at 11932. 28 Darvall v North Sydney Brick & Tile Co Ltd (1989) 16 NSWLR 260 at 292-293; Dempster v National Companies and Securities Commission (1993) 9 WAR 215 common with duties including those of directors and other officers29, is to establish liability of those officers who are sufficiently involved in the contravention. Hence, although a contravention of s 260A by a company does not affect the validity of any contract or transaction connected with the financial assistance30, and does not make the company liable for an offence31, the consequences of a contravention of s 260A may be serious for a person who is "involved"32 in that contravention. Such a person commits a separate contravention33 and is exposed to civil penalties34, including pecuniary penalty orders35 and compensation orders36. If the person's involvement in the breach is dishonest, then that person commits an offence under s 260D(3), with a maximum penalty of 2,000 penalty units or imprisonment for five years or both37. However, although the potential penal consequences are part of the context within which s 260A(1) falls to be interpreted and applied, this context should not distract the court from "its primary task of extracting the intention of the legislature from the fair meaning of words by which it has expressed that intention", particularly where that intention is to afford protection to a person or entity38. 29 See Corporations Act 2001 (Cth), s 260E; Wellington, "Regulating financial assistance: An obsolete regime" (2008) 26 Company and Securities Law Journal 7 at 27-33; Austin and Ramsay, Ford, Austin and Ramsay's Principles of Corporations Law, 17th ed (2018) at 1813 [24.670]. 30 Corporations Act 2001 (Cth), s 260D(1)(a). 31 Corporations Act 2001 (Cth), s 260D(1)(b). 32 Corporations Act 2001 (Cth), s 79. 33 Corporations Act 2001 (Cth), s 260D(2). 34 Corporations Act 2001 (Cth), s 1317E(1), table item 4. 35 Corporations Act 2001 (Cth), s 1317G. 36 Corporations Act 2001 (Cth), s 1317H. 37 Corporations Act 2001 (Cth), Sch 3, item 90. 38 Waugh v Kippen (1986) 160 CLR 156 at 164; [1986] HCA 12, after quoting from Beckwith v The Queen (1976) 135 CLR 569 at 576; [1976] HCA 55. The three elements necessary to establish a contravention of s 260A(1) that are relevant to this appeal are: (i) financial assistance given by the company; (ii) to acquire shares or units of shares in the company; and (iii) which materially prejudices the interests of the company or its shareholders or its ability to pay its creditors. The Connective companies deny the existence of each of these elements in their ground of appeal in this Court. Financial assistance As explained above, the re-drafted s 260A(1) was intended to resolve the uncertainty surrounding the application of the element of "financial assistance" by removing any issue concerning diminution or depletion of assets to a separate element of material prejudice in s 260A(1)(a)39. That element is considered separately below. It suffices to observe the breadth of the element of financial assistance in s 260A. The financial assistance need not involve a money payment by the company to the person acquiring the shares. Any action by the company can be financial assistance if it eases the financial burden that would be involved in the process of acquisition or if it improves the person's "net balance of financial advantage"40 in relation to the acquisition. For instance, the assistance might involve the company paying a dividend by means other than by payment of cash41, issuing a debenture42, granting security43, or agreeing to pay consultancy fees44. The breadth of the notion of financial assistance is particularly evident by s 260C, which creates exemptions for matters that would otherwise involve financial assistance. The exemptions include: (i) in the ordinary course of 39 See also Ooi, "The Financial Assistance Prohibition: Changing Legislative and Judicial Landscape" (2009) Singapore Journal of Legal Studies 135 at 148-149; Austin and Ramsay, Ford, Austin and Ramsay's Principles of Corporations Law, 17th ed (2018) at 1816-1817 [24.710]. 40 Charterhouse Investment Trust Ltd v Tempest Diesels Ltd [1986] BCLC 1 at 11. 41 Corporations Act 2001 (Cth), s 260A(2)(b); see also s 254U(1). 42 Victor Battery Co Ltd v Curry's Ltd [1946] Ch 242. 43 Firmin v Gray & Co Pty Ltd [1985] 1 Qd R 160. 44 Independent Steels Pty Ltd v Ryan [1990] VR 247. commercial dealing creating a lien on partly paid shares in the company for amounts payable to the company on the shares45; (ii) in the ordinary course of commercial dealing entering into an agreement to permit the person to make payments to the company on shares by instalments46; (iii) a discharge on ordinary commercial terms of a liability that the company incurred as a result of a transaction entered into on ordinary commercial terms47; and (iv) "assistance given under a court order"48. To acquire shares or units of shares The words "to acquire" require a sufficient link between the financial assistance and the acquisition of the shares or units of shares. Section 260A(1) does not require that an acquisition actually take place, since the provision can be contravened49 and injunctions can be ordered50 before any acquisition actually takes place. In this sense, "to acquire", like the express words of s 205(1) of the Corporations Law, includes conduct that is in connection with the process of an acquisition of the shares or units of shares and not limited to conduct for the purpose of acquisition. Acquisition also has broad connotations. It does not require a transaction or transfer. It includes acquisitions by issue or transfer or any other means51. The Connective companies referred to a number of examples which might be brought outside the operation of s 260A by a strict test for connection. The examples given by the Connective companies all concerned conduct by a company to enforce pre-emption requirements that might be contained in its constitution. The Connective companies submitted that provisions in the Corporations Act that recognise that conduct do not sit well with a "broad 45 Corporations Act 2001 (Cth), s 260C(1)(a). 46 Corporations Act 2001 (Cth), s 260C(1)(b). 47 Corporations Act 2001 (Cth), s 260C(5)(d). 48 Corporations Act 2001 (Cth), s 260C(5)(c). 49 Corporations Act 2001 (Cth), s 260A(2)(a). 50 Corporations Act 2001 (Cth), s 1324(1). 51 Corporations Act 2001 (Cth), s 260A(3). interpretation" of s 260A. The examples were of acts by a company in exercising a power52 to refuse to register a share transfer to any of the following: (i) the personal representative of a deceased shareholder53; (ii) a person54 or trustee in bankruptcy55 entitled to shares upon the bankruptcy of the shareholder; and (iii) a person entitled to shares on mental incapacity of a shareholder56. When the requirement of connection is properly applied none of these examples is automatically exempted from the operation of s 260A. It may be that in many such cases a company's conduct in enforcing its constitution by refusal of registration will occasion no material prejudice. However, if the company's conduct causes material prejudice to the interests of the company or its shareholders or the company's ability to pay its creditors, such as if the company's conduct includes incurring the cost of commencing and maintaining associated legal proceedings that would often be brought by others, there is no textual basis, nor any reason of principle, why s 260A must be incapable of extending to such conduct arising from any of these examples. Material prejudice The potential breadth of s 260A is constrained by the requirement of the implied prohibition that, by s 260A(1)(a), the financial assistance to acquire shares be materially prejudicial to the interests of the company or its shareholders or its ability to pay its creditors. Consistently with the protective purpose of s 260A(1), and its concern with minority shareholders, the reference to its the shareholders collectively and each "shareholders" must mean both shareholder individually. The issue of material prejudice to the interests of the company or its shareholders or creditors requires an assessment of and comparison between the position before the giving of the financial assistance and the position after it to see whether the company or its shareholders or its ability to pay its creditors is in a worse position. It does not assist to gloss the concept of material prejudice by 52 Corporations Act 2001 (Cth), s 1072G. 53 Corporations Act 2001 (Cth), s 1072A. 54 Corporations Act 2001 (Cth), s 1072B. 55 Corporations Act 2001 (Cth), s 1072C. 56 Corporations Act 2001 (Cth), s 1072D. introduction of further concepts, which the themselves require further explanation, such as whether there has been a diminution of the assets of the company, whether there has been a transaction, or whether there was a net transfer of value to the person acquiring the shares. For instance, the introduction of a requirement not present in the text of s 260A(1) of a transaction with, or a net transfer of value to, the person acquiring the shares could lead to further issues such as whether the interposition of intermediaries is included within those concepts. As the Explanatory Memorandum to the 1998 amendments said, the question of material prejudice is fact-intensive and "it will not be possible to determine whether the transaction involves material prejudice merely by reference to arbitrary rules, such as the percentage impact the transaction will have on the company's profit"57. To borrow an example from Hutley JA in Burton v Palmer58, a company might compromise a claim in relation to the transfer of shares in the interests of the company as a whole, but in some cases it "may be a nice question" whether the compromise materially prejudices the interests of the company or its shareholders or its ability to pay its creditors. The onus of proof It has been said that a company disputing the application of s 260A(1) bears the substantive onus of proof to negate material prejudice in all cases59. That issue did not arise in this appeal and was not the subject of any submissions in this Court. Relevantly to this appeal, s 1324(1B) provides that in an application for an injunction based upon an alleged contravention of s 260A(1)(a), the court "must assume that the conduct constitutes, or would constitute, a contravention of [s 260A(1)(a)] unless the company or person proves otherwise". In relation to s 1324(1B), the Court of Appeal correctly concluded that, in proceedings for an injunction under s 1324(1) to restrain a contravention of s 260A(1)(a), s 1324(1B) required the Connective companies to 57 Australia, House of Representatives, Company Law Review Bill 1997, Explanatory Memorandum at 73 [12.77]. 58 [1980] 2 NSWLR 878 at 880. 59 Adler v Australian Securities and Investments Commission (2003) 179 FLR 1 at 88 [410]-[411]. See also Austin and Ramsay, Ford, Austin and Ramsay's Principles of Corporations Law, 17th ed (2018) at 1820 [24.710]. disprove that their conduct constituted a contravention of s 260A(1)(a)60. The Connective companies were therefore required in the application for an injunction to disprove each element of "the conduct" that "would constitute" a contravention of s 260A(1)(a), including those in the prefatory words. The decisions of the primary judge and the Court of Appeal Before the primary judge, Almond J, Slea and Minerva sought a dismissal or stay of the pre-emptive rights proceeding on a number of bases61. One basis was that since the Accommodation Agreement had been obtained in discovery as part of other litigation, the pre-emptive rights proceeding had been commenced in breach of the Connective companies' legal obligation, historically described as an implied undertaking, not to use the Accommodation Agreement for any purpose other than that litigation62. The primary judge granted a stay on that ground63. However, the Connective companies subsequently applied for, and were given, leave nunc pro tunc to use the Accommodation Agreement for the purpose of commencing the pre-emptive rights proceeding64. An alternative form of relief sought by Slea and Minerva before the primary judge is the subject of this appeal. They sought an injunction under s 1324(1) of the Corporations Act to restrain the Connective companies from prosecuting the pre-emptive rights proceeding on the basis that by doing so they were in violation of the implied prohibition against financial assistance in s 260A(1) of the Corporations Act. The primary judge held that the Connective companies had not contravened s 260A65. Central to his Honour's reasoning was the absence of a transaction between the Connective companies and Millsave or Mr Haron. The search for a transaction, which is not a requirement of s 260A, led his Honour to 60 Slea Pty Ltd v Connective Services Pty Ltd (2018) 359 ALR 159 at 173 [75]. 61 Connective Services Pty Ltd v Slea Pty Ltd (2017) 53 VR 130 at 135 [10]. 62 See Hearne v Street (2008) 235 CLR 125 at 157-160 [105]-[108]; [2008] HCA 36. 63 Connective Services Pty Ltd v Slea Pty Ltd (2017) 53 VR 130 at 159-160 [116]. 64 Slea Pty Ltd v Connective Services Pty Ltd (2017) 53 VR 161 at 179 [73]. 65 Connective Services Pty Ltd v Slea Pty Ltd (2017) 53 VR 130 at 159 [115]. the conclusion that the commercial realities of the pursuit of the pre-emptive rights proceeding by the Connective companies were that the Connective companies had "simply brought the proceeding in order to ensure that their constitutions are followed according to their terms"66. The primary judge also said that there was no benefit conferred on Millsave or Mr Haron, accepting the submission by the Connective companies that the rights of Millsave and Mr Haron to be offered the shares existed prior to any proceeding, and also drawing a distinction between the acquisition of shares and the offer of shares pursuant to a pre-emptive right67. The Court of Appeal (Ferguson CJ, Whelan and McLeish JJA) allowed the appeal by Slea and Minerva. Although the Court of Appeal, adopting the common submissions of the parties, added an unnecessary element to s 260A(1) of a "net transfer of value"68, the Court of Appeal nevertheless concluded that s 260A(1) had been contravened69. The Court of Appeal held that the "commercial consequence" was that since Slea would not make the pre-emptive offer without a court order, some action was required to be taken to enforce the existing right. As the pre-emptive rights proceeding sought to procure that outcome, it assisted Millsave and Mr Haron to acquire shares in the Connective companies if they decided to accept the offer70. By bringing the pre-emptive rights proceeding, the Connective companies had financially assisted Millsave and Mr Haron since there was no evidence that Millsave and Mr Haron had incurred any costs or taken on any potential cost liability71. The Connective companies contravened s 260A(1) The broad concept of financial assistance, described above, extends beyond direct contributions to the share price. Examples of financial assistance 66 Connective Services Pty Ltd v Slea Pty Ltd (2017) 53 VR 130 at 156-157 [97]. 67 Connective Services Pty Ltd v Slea Pty Ltd (2017) 53 VR 130 at 157 [98]. 68 Slea Pty Ltd v Connective Services Pty Ltd (2018) 359 ALR 159 at 170 [60], 174 69 Slea Pty Ltd v Connective Services Pty Ltd (2018) 359 ALR 159 at 174 [78]. 70 Slea Pty Ltd v Connective Services Pty Ltd (2018) 359 ALR 159 at 173 [77]. 71 Slea Pty Ltd v Connective Services Pty Ltd (2018) 359 ALR 159 at 173 [77]. by a company include the reduction of the financial burden of acquisition by payment of the costs of stamp duty, valuation costs, or, as has been held in the context of a differently worded provision in England, incurring due diligence costs which "smoothed the path to the acquisition of shares"72. Bringing legal proceedings against Slea was a necessary step for the vindication of any pre-emptive rights of Millsave and Mr Haron. Those legal proceedings could have been commenced by Millsave and Mr Haron73. If they had been so commenced, then it would plainly have been financial assistance for the Connective companies to provide the funds for Millsave and Mr Haron's proceedings just as it would have been financial assistance to provide funds for stamp duty, valuation costs, or due diligence costs. Instead, the proceedings were commenced at the expense of the Connective companies, in which Millsave and Mr Haron hold 66.67% of the shares. The Connective companies eased a financial burden in the process of any acquisition of shares by Millsave and Mr Haron. The commencement of the pre-emptive rights proceeding by the Connective companies, at their expense, was financial assistance to Millsave and Mr Haron. The Connective companies submitted that any financial assistance by the companies was not to acquire shares in the companies. Although Slea would not make the pre-emptive offer without a court order, and hence a court order was a necessary step towards an acquisition of shares, the Connective companies submitted that the pre-emptive rights proceeding would not "create any new rights" and that, in any event, the pre-emptive rights were only to be offered shares for purchase. The pre-emptive rights would not necessarily give rise to an acquisition. This narrow approach to the requirement that the financial assistance be to acquire shares or units of shares is not consistent with the breadth of application of the words "to acquire" as extending to all conduct in connection with the process of acquiring the shares or units of shares. For instance, as the Connective companies rightly accepted, even the final act in that process, namely registration of shares, can be in connection with an acquisition if one party has refused to transfer shares in which the other has an equitable interest. Further, the process of acquisition does not exclude any court recognition of pre- emptive rights merely because the rights, if exercised, would not result in the 72 Chaston v SWP Group Plc [2003] 1 BCLC 675 at 688 [38]. 73 See, eg, Grant v John Grant & Sons Pty Ltd (1950) 82 CLR 1 at 3, 18, 29; [1950] HCA 54. acquisition of shares. Indeed, s 260A(1) includes the acquisition of "units of shares" and a "unit" of shares is defined in s 9 of the Corporations Act in terms that include "an option to acquire such a right or interest in the share". The Connective companies thus financially assisted Millsave and Mr Haron to acquire shares, or units of shares, in the companies. The Connective companies then submitted that any financial assistance they gave would not materially prejudice the interests of the companies or their shareholders or the ability of the companies to pay their creditors. As explained above, the Connective companies properly accepted in this Court that they bore the onus of negating this element before the primary judge. The Connective companies will incur costs in conducting the pre-emptive rights proceeding which, even if they succeed, will not be entirely recovered. Before the primary judge, Slea led evidence that the estimated cost of the pre- emptive rights proceeding was $525,000 to $755,000 in addition to any potential adverse costs orders74. As a shareholder, Slea's equity may be reduced by these costs of the pre-emptive rights proceeding, which is a step towards compelling Slea to offer its shares for transfer to Millsave and Mr Haron. The pre-emptive rights proceeding could, and commonly would, have been brought by Millsave and Mr Haron in their own right. Yet the Connective companies led no evidence to explain whether they had even sought funding or indemnity from costs liability from Millsave and Mr Haron. The Connective companies did not discharge their onus of proving that there was no material prejudice to them or their shareholders by giving the financial assistance to Millsave and Mr Haron. Conclusion The Connective companies submitted that if the Court of Appeal's decision were to stand then a company would have no practical ability to enforce pre-emptive rights provisions in its constitution. That submission is not correct. Section 140(1) of the Corporations Act provides that a company's constitution has effect as a contract "between the company and each member" and "between a member and each other member". However, s 140(1) of the Corporations Act cannot be read divorced from other provisions of the Corporations Act with which it may intersect. 74 Connective Services Pty Ltd v Slea Pty Ltd (2017) 53 VR 130 at 154 [82]. Section 260A(1) does not abrogate the power of a company to enforce its constitution. However, together with s 1324(1B), it has the effect that if a company wishes to bring proceedings to enforce pre-emptive rights in its constitution, for the benefit of some of its shareholders but at the company's expense, then the company is liable to be enjoined from doing so unless the assistance is approved by shareholders under s 260B, or unless the company can satisfy the court that bringing the proceedings at its own expense does not materially prejudice the interests of the company or its shareholders or the company's ability to pay its creditors. The Connective companies failed to discharge this onus. The appeal should be dismissed. As the third and fourth respondents entered submitting appearances, the appellants should pay the costs of the first and second respondents.

HIGH COURT OF AUSTRALIA APPELLANT AND THE QUEEN RESPONDENT [2014] HCA 28 Date of Order: 19 June 2014 Date of Publication of Reasons: 13 August 2014 ORDER Appeal allowed. Set aside the orders of the Court of Criminal Appeal of the Supreme Court of South Australia made on 16 August 2013 and in their place: order that the appeal to that Court against conviction is allowed and the appellant's conviction is quashed; and direct that a judgment and verdict of acquittal is entered. On appeal from the Supreme Court of South Australia Representation D M J Bennett QC with A L Tokley SC and S A McDonald for the appellant (instructed by Iles Selley Lawyers) J P Pearce QC with T J Ellison for the respondent (instructed by Director of Public Prosecutions (SA)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Criminal law − Evidence − DNA evidence − Where appellant's DNA obtained from object found at crime scene − Whether DNA evidence sufficient to establish beyond reasonable doubt appellant's presence at, and participation in, crime committed. Words and phrases − "DNA evidence", "joint enterprise", "primary transfer", "secondary transfer". Criminal Law Consolidation Act 1935 (SA), s 353(1). HAYNE, CRENNAN, KIEFEL, BELL AND GAGELER JJ. Shortly before 6:00am on 19 June 2011, a group of men forced their way into a house in Elizabeth South in South Australia and attacked two of the occupants with weapons including a gardening fork and a pole. One victim, Kym Bruce Drover, died four days after the attack and another, Leon Karpany, sustained serious brain injuries. to ss 11 and 23(1) respectively of The appellant was charged on information with one count of murder and a second count of "aggravated causing serious harm with intent to cause serious the Criminal Law harm" contrary Consolidation Act 1935 (SA) ("the CLCA") arising out of this incident. After a joint trial before a judge and jury in the Supreme Court of South Australia, the appellant and his co-accused, Grant Andrew Sumner, were convicted on both counts. Each is serving a term of life imprisonment subject to a non-parole period of 20 years consequent upon the convictions. The appellant appealed against his conviction to the Court of Criminal Appeal of the Supreme Court of South Australia. The prosecution did not contend that either Sumner or the appellant inflicted the fatal blow on the deceased or the blows that occasioned serious injury to Leon Karpany. Shortly stated, it was the prosecution case that Sumner and the appellant were members of the group that forced entry into the house and that each member of the group was a party to a common plan to cause grievous bodily harm to persons inside the house. The real issue in the appellant's trial was the sufficiency of the evidence to establish that he was one of the group. The prosecution relied on DNA evidence obtained from a sample taken from a didgeridoo found at the crime scene to establish that fact. The appellant argued unsuccessfully before the Court of Criminal Appeal that the verdicts were unreasonable and could not be supported by the evidence. Section 353(1) of the CLCA relevantly provides that the Court of Criminal Appeal: "shall allow the appeal if it thinks that the verdict of the jury should be set aside on the ground that it is unreasonable or cannot be supported having regard to the evidence". Hayne Crennan Bell The parties agreed that the applicable principles are to be found in M v The Queen1, as explained in MFA v The Queen2. The question which an appellate court is required to consider to determine whether a verdict of guilty "is unreasonable, or cannot be supported, having regard to the evidence"3 is whether upon the whole of the evidence it was open to the jury to be satisfied beyond reasonable doubt that the accused was guilty. The appellant's first ground of appeal, by special leave to this Court4, contended that the Court of Criminal Appeal erred in failing to find that upon the whole of the evidence the verdicts could not be supported. The appellant's second and third grounds were different ways of stating that contention. At the conclusion of the hearing of the appeal in this Court orders were made allowing the appeal and directing that a judgment and verdict of acquittal be entered. What follows are the reasons for making those orders. The facts The appellant's co-accused, Sumner, visited the house in Elizabeth South twice on 19 June 2011. Approximately two hours before the attack, Sumner had been involved in several physical altercations at the house. One such altercation, described as a "play fight", resulted in Sumner splitting the lip of the deceased. At one stage during those altercations, Sumner sat on a freezer in the kitchen near where the didgeridoo was located. Events culminated in a fight at the front of the house between Sumner and his father, as a result of which Sumner suffered a fracture to his jaw and was chased away from the house by the deceased. Eyewitnesses at the scene gave evidence at the trial that Sumner, together with his mother, shouted threats of retaliation as they drove away. Sumner gave unchallenged evidence that before this first visit to the house he had attended a boxing match at which he had occasion to shake hands twice with the appellant, (1994) 181 CLR 487 at 493-494; [1994] HCA 63. (2002) 213 CLR 606 at 614 [25]; [2002] HCA 53; see also Jones v The Queen (1997) 191 CLR 439; [1997] HCA 56 and Gipp v The Queen (1998) 194 CLR 106 at 123 [49] per McHugh and Hayne JJ; [1998] HCA 21. 3 MFA v The Queen (2002) 213 CLR 606 at 614 [25]. [2014] HCATrans 048. Hayne Crennan Bell including at about 10:30pm. The significance of this evidence will be explained later. Shortly before 6:00am, the intruders, including Sumner, arrived at the house in several motor vehicles. The men split into two groups and simultaneously attacked the property, forcing their way in through the front and rear doors. Some men were armed with axes and gardening forks, while others armed themselves opportunistically upon entering the house. The group attacked the occupants as described at the outset of these reasons. As mentioned above, at the trial of the appellant and Sumner the prosecution contended that both men were part of the group that had forced entry into the house armed with weapons for the purpose of inflicting grievous bodily harm on one or more of the occupants. There was no direct evidence that either man inflicted harm on the deceased or Leon Karpany. It was an agreed fact read to the jury that six persons who were present during the attack, and were shown photographs of the appellant, failed to identify him. The appellant was excluded from DNA results taken from a variety of objects found at the crime scene and from four out of five forensic samples taken from the didgeridoo. However, one forensic sample from the didgeridoo, Sample 3B, contained a mixed DNA profile of "major" and "minor" contributors. The appellant's DNA was the major contributor and an unknown source was the minor contributor. The prosecution case was that the presence of the appellant's DNA on the didgeridoo, together with apparent blood stains containing the DNA of the deceased and Leon Karpany, sufficed to prove the appellant's presence at the scene as one of the intruders. That case depended upon satisfaction beyond reasonable doubt that the appellant's DNA was transferred by him to the didgeridoo at the time of the attack. The appellant did not give evidence at the trial. The evidence concerning the didgeridoo Nardene Wanganeen, Sumner's aunt and the tenant of the house, gave evidence that the didgeridoo, normally kept beside the washing machine in the laundry, had been acquired in 2009 by her late partner. Although she stated that she did not allow people to play the didgeridoo, at around 5:00pm on the night Hayne Crennan Bell before the attack the didgeridoo had been played by the deceased. Nardene Wanganeen did not know the appellant. The deceased's sister, Leticia Webb, gave evidence that during the course of the attack at the house she had grabbed the didgeridoo defensively when it was next to the freezer in the kitchen. She gave evidence that she put the didgeridoo back next to the freezer when commanded to put it down by the intruders and that she did not take it into the lounge room. The didgeridoo was found in the lounge room in close proximity to where the deceased was left after the attack. There was no evidence of how it came to be in the lounge room and no direct evidence that it was used in the attack. The evidence concerning DNA Sample 3B That the appellant's DNA was contained in Sample 3B was not challenged by the appellant. A qualified forensic expert, Dr Julianne Henry, gave evidence at the trial for the prosecution. She explained that Sample 3B came from an area on the didgeridoo showing "reddy-brown stains" which had been removed using a scalpel. The sample consisted of two separate "bloodlike stains", one having a diameter of 2 millimetres by 1 millimetre and the other a diameter of less than 1 millimetre. Dr Henry said that even if the abovementioned "reddy-brown stains" were in fact blood (as indicated by a presumptive test), that circumstance did not prove that the DNA in Sample 3B derived from blood because the DNA may have been "under the stain", ie placed on the didgeridoo at an earlier time. She agreed with counsel for the prosecution that the "reddy-brown stains" may have "contributed nothing" to Sample 3B. DNA and blood Dr Henry explained that DNA, a molecule in cells from the human body, can be transferred to an object in biological fluid such as blood (or saliva) or through contact with a person's skin. She said the amount of DNA transferred through contact with a person's skin, called "contact" or "trace" DNA, is low compared to the amount of DNA transferred in a biological fluid. Finally, Dr Henry gave evidence that some people "shed" contact or trace DNA more readily than others. Hayne Crennan Bell Dr Henry stated that there were three possible ways in which blood may be transferred to an object: direct transfer (where contact occurs between a person and an object), airborne transfer (where blood travels through the air and then lands on an object) and passive transfer (where a person's blood drips onto an object). Dr Henry was unable to distinguish, from a photograph, whether the deceased's blood on the didgeridoo was transferred directly or by having been airborne. Primary and secondary DNA transfer Dr Henry explained the differences between "primary" and "secondary" DNA transfer. A primary transfer occurs as a result of direct contact between a particular person and an object. A secondary transfer occurs when contact or trace DNA is transferred onto an object by an intermediary as a result, for example, of a handshake. Dr Henry gave evidence that the most likely way to obtain contact or trace DNA on an object was through primary, rather than secondary, transfer. She also stated that a secondary transfer of DNA remains possible a few hours after contact between a person and an intermediary, and that an intermediary's DNA is not necessarily transferred at the same time, although she was only aware of one example of this in the relevant literature. She accepted as a possibility that the appellant's DNA in Sample 3B was the result of a secondary transfer. Mixed DNA profiles Dr Henry explained that where DNA of more than one person is identified in a sample, there will usually be one major contributor and one minor contributor to the DNA profile. In most (but not all) cases where a secondary transfer of DNA occurs, the major contributor to the DNA profile will likely be the person transferring the DNA and the minor contributor will be the person whose DNA is transferred. Dr Henry gave evidence that it was likely that a person who was the major contributor to a DNA profile would have left blood on an object because blood is a richer source of DNA than epithelial cells. However, she went on to state that it was possible that the DNA in Sample 3B was derived from a source other than blood because "it was difficult to conclude from the yield of DNA that we obtained from those stains that the DNA did come from blood". After giving that evidence, she was cross-examined about the source of the DNA in Sample 3B. It is convenient to set out the passage transcribing her answers: It could have been blood, it could have been something other than blood. Hayne Crennan Bell By 'something else' it could be saliva for example. That's possible, yes. It could be the transference of cells. That's possible, yes. And we will come back to the question of transfer, but primary or secondary transfer. Yes." Sumner's DNA was not found on the didgeridoo at all. That was relevant to the appellant's reliance upon an hypothesis of a transfer of DNA from the appellant's hand to Sumner's hand when the two men shook hands at the boxing match, and a subsequent secondary transfer of the appellant's DNA to the didgeridoo by Sumner on one or other of his two visits to the house on 19 June DNA accumulation Dr Henry stated that recovering DNA from an object does not indicate the time of its deposit on the object from which it is retrieved. With current technology, DNA cannot be "aged". She also stated that DNA could accumulate over a period of time, days or even weeks, and she accepted that contact or trace DNA could have been on the didgeridoo for some time before the attack. The reasoning of the Court of Criminal Appeal The Court of Criminal Appeal (Gray and Sulan JJ; Blue J agreeing) found that it was open to the jury to conclude beyond reasonable doubt that the appellant's DNA was deposited on the didgeridoo as a result of direct contact by the appellant at the time of the attack5. In their Honours' view, in light of Dr Henry's evidence, the alternative hypothesis of a secondary transfer of the appellant's DNA to the didgeridoo by Sumner was "extremely unlikely" 6. In so concluding, the Court of Criminal Appeal confined its considerations to Sumner's 5 R v Sumner (2013) 117 SASR 271 at 298 [108]. 6 R v Sumner (2013) 117 SASR 271 at 298 [106]. Hayne Crennan Bell second visit to the house at around 6:00am and did not refer to Dr Henry's evidence that an intermediary's DNA will not necessarily be deposited when the intermediary makes a secondary transfer of another's DNA. Further, the Court of Criminal Appeal referred neither to the possibility that the appellant's DNA may have been the subject of a primary transfer to the didgeridoo on an occasion earlier than the attack nor to Dr Henry's evidence about the accumulation of DNA and the impossibility of "dating" DNA. The Court of Criminal Appeal concluded that the jury was entitled to reject any argument that there was an hypothesis consistent with the appellant's innocence and unanimously dismissed the appellant's appeal against conviction. The questions The appellant had no complaint about the trial judge's summing up to the jury regarding the DNA evidence. However, the appellant contended that this appeal raised two questions for consideration by this Court. The first was whether DNA evidence alone is sufficient to establish beyond reasonable doubt both presence and participation for the purposes of joint enterprise liability, in circumstances where the issue is not whether there is a match between the appellant's DNA and a DNA sample but when and how the DNA got there. The second question was whether it was unreasonable to convict the appellant in circumstances where the expert called by the prosecution to give evidence about DNA testified about secondary transfer of DNA, thereby raising a reasonable hypothesis on the evidence consistent with the appellant's innocence. There was no dispute between the parties that it was an essential link in the prosecution's circumstantial case that the appellant's DNA was transferred by him to the didgeridoo during the attack. That circumstance was required to be proved beyond reasonable doubt7. Arguments in this Court The appellant It was submitted by the appellant that both elements of the statutory provision were satisfied. It was contended that the only evidence tending to establish the appellant's presence during the attack (Sample 3B) failed to establish that fact beyond reasonable doubt, and the jury should not have convicted. In particular, it was contended that the evidence failed to establish 7 Shepherd v The Queen (1990) 170 CLR 573; [1990] HCA 56. Hayne Crennan Bell how, or when, the DNA of the appellant was transferred to the didgeridoo. In amplifying these submissions, possibly beyond what had been put below, four aspects of the prosecution case against the appellant, based on Sample 3B, were contested. The first and major contest was over whether the microscopic sample of the appellant's DNA in Sample 3B came from his blood. The second contested point was whether secondary transfer of DNA was "rare". The third contest was over whether the hypotheses raised on behalf of the appellant, as alternatives to the prosecution case, depended on a highly improbable chain of events. The final contested matter concerned the timing of the transfer of the appellant's DNA to the didgeridoo. In relying on Dr Henry's evidence summarised above, the appellant submitted that the evidence did not make out, beyond reasonable doubt, that the appellant's DNA in Sample 3B was sourced from the appellant's blood. The appellant submitted that Dr Henry's evidence, that a primary transfer is the most likely way that contact or trace DNA is placed on an object, did not render a "rarity" the possibility, which she conceded, of a secondary transfer of DNA. There were at least two occasions on which a secondary transfer of the appellant's DNA to the didgeridoo may have occurred – when Sumner first went to the house on the day in question, or two hours later when Sumner was present during the attack. As to whether the alternative hypothesis of a secondary transfer by Sumner was "extremely unlikely" (as concluded by the Court of Criminal Appeal), the appellant submitted that if Sumner were the intermediary, the likelihood was that a secondary transfer of the appellant's DNA to the didgeridoo occurred on his first visit to the house. That possibility was not referred to by the Court of Criminal Appeal. It was also contended that Nardene Wanganeen's lack of knowledge of the appellant did not exclude a second hypothesis, consistent with the appellant's innocence, that the appellant had come into contact with the didgeridoo at the house on an earlier occasion, a consideration put aside by the Court of Criminal Appeal. In regard to both points, the appellant relied on the expert evidence that DNA deposits can accumulate and that DNA cannot be "aged". In summary, the appellant contended that the Crown had not proved its case against the appellant and reasonable hypotheses consistent with innocence could not be excluded by the jury, which should have resulted in the Court of Criminal Appeal applying s 353(1) of the CLCA in the appellant's favour. Hayne Crennan Bell The respondent The respondent relied on R v Hillier8 to support the proposition that evidence supporting inferences compatible with the appellant's innocence should not be considered in isolation from the rest of the evidence. So much may be accepted. The respondent contended that it was open to the jury to be satisfied beyond reasonable doubt that the appellant had not come into direct contact with the didgeridoo prior to the attack because of the circumstances in which the didgeridoo was kept and because there was no evidence of the appellant's presence at the house prior to the incident. It was also contended that, notwithstanding an absence of direct evidence on the point, it could be inferred that one of the intruders picked up the didgeridoo and took it into the lounge room because it was found there, it contained DNA from both victims and there was evidence that the intruders armed themselves opportunistically after breaking into the house. More critically, the respondent urged the Court to reject the secondary transfer theory, whether applied to Sumner or another, essentially on the basis that the appellant's DNA was the major contributor to the DNA in Sample 3B and the likelihood that the appellant's DNA in Sample 3B derived from blood. It was also submitted that whether the DNA in the sample derived from blood could be assessed against the "unlikelihood" of a secondary transfer. A degree of circularity in those submissions reflected the dearth of evidence of what had been done with the didgeridoo before the attack. Guilt beyond reasonable doubt? On Dr Henry's evidence, including that extracted above, the prosecution's main contention, that the appellant's DNA in Sample 3B derived from the appellant's blood, was not made out beyond reasonable doubt. Secondly, Dr Henry's evidence was not that secondary transfer of DNA was "rare"; rather, she said that a primary transfer is a much more likely source of contact or trace DNA than a secondary transfer, but that nevertheless a secondary transfer of contact or trace DNA is possible. There was no conflict in the evidence that there were at least two distinct occasions, described above, on which a secondary transfer of the appellant's DNA to the didgeridoo may have occurred. Thirdly, the recovery of the appellant's DNA from the didgeridoo did not raise any inference about the time when or circumstances in which the DNA was deposited (2007) 228 CLR 618 at 637-638 [46]-[48]; [2007] HCA 13. Hayne Crennan Bell there. For those reasons, it could not be accepted that the evidence relied on by the prosecution was sufficient to establish beyond reasonable doubt that the appellant was present at, and participated in, the attack. The jury, acting reasonably, should have entertained a reasonable doubt as to the appellant's guilt9. Alternative hypotheses consistent with the appellant's innocence, in particular the hypothesis that Sumner transferred the appellant's DNA to the didgeridoo on Sumner's first visit to the house on the day in question, were not unreasonable and the prosecution had not successfully excluded them. As the evidence was not capable of supporting the appellant's conviction for either offence, no question of an order for a new trial arose. Orders The orders made were as follows: Appeal allowed. Set aside the orders of the Court of Criminal Appeal of the Supreme Court of South Australia made on 16 August 2013 and in their place: order that the appeal to that Court against conviction is allowed and the appellant's conviction is quashed; and direct that a judgment and verdict of acquittal is entered. 9 M v The Queen (1994) 181 CLR 487 at 493-494.

HIGH COURT OF AUSTRALIA PLAINTIFF AND THE COMMISSIONER OF POLICE & ORS DEFENDANTS Zhang v Commissioner of Police [2021] HCA 16 Date of Hearing: 7 & 8 April 2021 Date of Judgment: 12 May 2021 ORDER The questions of law stated in the special case filed on 11 November 2020 be answered as follows: Are the First Search Warrant, the Second Search Warrant, and the Third Search Warrant invalid, in whole or in part, on the ground that: they misstate the substance of s 92.3(2) of the Criminal Code (Cth)? they fail to state the offences to which they relate with sufficient precision? s 92.3(1) of the Criminal Code (Cth) is invalid on the ground that it impermissibly burdens the implied freedom of political communication? s 92.3(2) of the Criminal Code (Cth) is invalid on the ground that it impermissibly burdens the implied freedom of political communication? Answer: The First Search Warrant, the Second Search Warrant and the Third Search Warrant are not wholly invalid on any of the identified grounds. The question is otherwise unnecessary to answer. In light of the answer to Question 1, is the First s 3LA Order and/or the Second s 3LA Order invalid? Answer: Is s 92.3(1) of the Criminal Code (Cth) invalid on the ground that it impermissibly burdens freedom of political communication? implied the Answer: Unnecessary to answer. Is s 92.3(2) of the Criminal Code (Cth) invalid on the ground that it impermissibly burdens freedom of political communication? implied the Answer: Unnecessary to answer. If the answer to any or all of the questions (1)–(4) is "yes", what relief, if any, should issue? Answer: None. (6) Who should pay the costs of the proceeding? Answer: The plaintiff. Representation B W Walker SC with V R Brigden for the plaintiff (instructed by Nyman S P Donaghue QC, Solicitor-General of the Commonwealth, and P D Herzfeld SC with S Zeleznikow for the first defendant and for the intervening (instructed by Attorney-General of Australian Government Solicitor) the Commonwealth, M G Sexton SC, Solicitor-General for the State of New South Wales, with K N Pham for the Attorney-General for the State of New South Wales, intervening (instructed by Crown Solicitor's Office (NSW)) M J Wait SC, Solicitor-General for the State of South Australia, with K M Scott for the Attorney-General for the State of South Australia, intervening (instructed by Crown Solicitor's Office (SA)) Submitting appearances for the second, third and fourth defendants Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Zhang v Commissioner of Police Police – Search warrants – Validity of warrants – Validity of orders – Where officers of Australian Federal Police ("AFP") searched premises in reliance on warrants – Where officers of AFP seized material they believed relevant to offences against s 92.3(1) and (2) of Criminal Code (Cth) – Where officers examined and copied data from electronic devices at searched premises – Where plaintiff compelled to provide passcodes to devices pursuant to orders under s 3LA of Crimes Act 1914 (Cth) – Where warrants purported to authorise search and seizure of material relevant to offences against s 92.3(1) and (2) of Criminal Code – Where plaintiff accepted warrants severable – Whether warrants identified the substance of offences against s 92.3(1) of Criminal Code with sufficient precision. Constitutional law (Cth) – Implied freedom of communication about government or political matters – Where warrants purported to authorise search and seizure of material relevant to offences against s 92.3(1) and (2) of Criminal Code – Where plaintiff accepted warrants severable – Where plaintiff accepted various sub- paragraphs of s 92.3(1)(b), (c) and (d) capable of severance under s 15A of Acts Interpretation Act 1901 (Cth) – Whether appropriate to proceed to determine constitutional validity of s 92.3(1) of Criminal Code or construction of "covert". Words and phrases – "covert", "foreign government principal", "foreign influence", "foreign interference", "foreign principal", "implied freedom of political communication", "necessary to decide", "premature interpretation of statutes", "prudential considerations", "read down", "search warrants", "severable", "severance", "substance of the offences", "sufficient precision", "unnecessary and inappropriate to answer". Acts Interpretation Act 1901 (Cth), s 15A. Crimes Act 1914 (Cth), ss 3C(1), 3E, 3LA. Criminal Code (Cth), ss 90.1, 90.2, 90.3, 92.3. KIEFEL CJ, GAGELER, KEANE, GORDON, EDELMAN, STEWARD AND GLEESON JJ. Mr John Shi Sheng Zhang is an Australian citizen born in the People's Republic of China ("the PRC"). Between October 2018 and September 2020, Mr Zhang was employed under the Members of Parliament Staff Act 2013 (NSW) at the New South Wales Parliament in the office of the Honourable Shaoquett Moselmane MLC, who was a member of the New South Wales Opposition until his suspension from the Australian Labor Party in June 2020. Mr Zhang has for some time been under investigation by the Australian Federal Police ("the AFP") for offences against s 92.3(1) and (2) of the Criminal Code (Cth) suspected to have been committed by him between July 2019 and June 2020. In the context of that investigation, officers of the AFP obtained search warrants issued under s 3E of the Crimes Act 1914 (Cth). Each warrant purported to authorise search and seizure of material relevant to offences against s 92.3(1) and (2) of the Criminal Code. Executing those warrants, officers of the AFP seized material they believed relevant to offences against s 92.3(1) and (2) of the Criminal Code as well as material they believed relevant to offences against other provisions of the Criminal Code. Officers examined and copied data from mobile phones, computers, and other electronic devices at search premises. They also removed mobile phones, computers, and other electronic devices from search premises and took steps to extract data from the removed devices including by using passcodes which Mr Zhang was compelled to provide to them pursuant to orders made under s 3LA of the Crimes Act. They retain the copied data and some of the seized material. The investigation is ongoing. In a proceeding in the original jurisdiction of this Court under s 75(v) of the Constitution and s 30(a) of the Judiciary Act 1903 (Cth), Mr Zhang seeks writs of certiorari quashing each search warrant and each order under s 3LA of the Crimes Act together with a mandatory injunction requiring the destruction or return of the seized and copied material. He also seeks declarations of invalidity of s 92.3(1) and (2) of the Criminal Code. By special case in the proceeding, Mr Zhang and the Commissioner of Police have agreed in stating questions of law for the opinion of the Full Court. For reasons to be explained, most of those questions are unnecessary and inappropriate to answer. To be emphasised at the outset is that Mr Zhang has no standing to challenge the validity of s 92.3(1) and (2) of the Criminal Code by reason merely of the ongoing AFP investigation or of the potential for him to be charged with offences against those provisions as a result of that investigation1. His standing to challenge the validity of those provisions arises only as an aspect of his standing to challenge the validity of the warrants and orders under authority of which occurred derogation from his common law rights. Mr Zhang's challenge to the validity of each warrant is on two grounds. The first is that each warrant fails to comply with s 3E(5)(a) of the Crimes Act as expounded in Smethurst v Commissioner of the Australian Federal Police2 in that it does not identify the substance of the offences against s 92.3(1) and (2) of the Criminal Code to which it relates with sufficient precision. The second is that each warrant fails to authorise search and seizure of "evidential material" as defined in s 3C(1) of the Crimes Act at all because any offence against s 92.3(1) and (2) of the Criminal Code to which the warrant might relate does not exist by reason of the invalidity of s 92.3(1) and (2). His challenge to each order under s 3LA of the Crimes Act is entirely derivative upon his challenge to the corresponding search warrant. to authorise search and seizure of material relevant Mr Zhang accepts that each search warrant is severable insofar as it purports to authorise search and seizure of material relevant to offences against s 92.3(1) and to offences against s 92.3(2). He also accepts that the totality of the search and seizure that occurred pursuant to each warrant was authorised if the warrant was valid in relation to offences against either provision. What follows from that acceptance is that Mr Zhang cannot be entitled to the relief he seeks in the proceeding unless he can establish that the warrants are invalid in purporting to authorise search and seizure of material relevant to offences against both s 92.3(1) and s 92.3(2). Hence, it suffices for the purposes of the special case to concentrate on the challenges to each warrant's purported 1 Kuczborski v Queensland (2014) 254 CLR 51 at 106-110 [175]-[188]; Smethurst v Commissioner of the Australian Federal Police (2020) 94 ALJR 502 at 529-530 [106]-[107]; 376 ALR 575 at 600-601. (2020) 94 ALJR 502 at 516-518 [22]-[30], 551-552 [206]-[211]; 376 ALR 575 at authorisation of search and seizure of material relevant to offences against s 92.3(1). If the warrant is not invalid on either ground advanced in relation to offences against s 92.3(1), it is irrelevant whether the warrant is or is not invalid on either ground advanced in relation to offences against s 92.3(2). Section 92.3(1) of the Criminal Code provides: "A person commits an offence if: the person engages in conduct; and any of the following circumstances exists: the conduct is engaged in on behalf of, or in collaboration with, a foreign principal or a person acting on behalf of a foreign principal; the conduct is directed, funded or supervised by a foreign principal or a person acting on behalf of a foreign principal; and the person is reckless as to whether the conduct will: influence a political or governmental process of the Commonwealth or a State or Territory; or influence the exercise (whether or not in Australia) of an Australian democratic or political right or duty; or (iii) support intelligence activities of a foreign principal; or prejudice Australia's national security; and any part of the conduct: is covert or involves deception; or involves the person making a threat to cause serious harm, whether to the person to whom the threat is made or any other person; or (iii) involves the person making a demand with menaces. Penalty: Imprisonment for 15 years." The provision must be read with a number of definitions, one of which is the definition of "foreign principal" in s 90.2. That section provides: "Each of the following is a foreign principal: a foreign government principal; a foreign political organisation; a public international organisation within the meaning of Division 70 (see section 70.1); a terrorist organisation within the meaning of Division 102 (see section 102.1); an entity or organisation owned, directed or controlled by a foreign principal within the meaning of paragraph (aa), (b) or (c); an entity or organisation owned, directed or controlled by 2 or more foreign principals within the meaning of paragraph (a), (aa), (b) or Bearing on s 90.2(a) and (aa), the expressions "foreign political organisation" and "foreign government principal" are in turn defined in s 90.1(1) and s 90.3 respectively. Section 90.1(1) relevantly provides: "foreign political organisation includes: a foreign political party; and a foreign organisation that exists primarily to pursue political objectives; and a foreign organisation that exists to pursue militant, extremist or revolutionary objectives." Section 90.3 provides: "Each of the following is a foreign government principal: the government of a foreign country or of part of a foreign country; an authority of the government of a foreign country; an authority of the government of part of a foreign country; a foreign local government body or foreign regional government body; a company to which any of the subparagraphs of paragraph (a) of the definition of foreign public enterprise in section 70.1 applies; a body or association to which either of the subparagraphs of paragraph (b) of the definition of foreign public enterprise in section 70.1 applies; an entity or organisation owned, directed or controlled: by a foreign government principal within the meaning of any other paragraph of this definition; or by 2 or more such foreign government principals that are foreign government principals in relation to the same foreign country." Each search warrant identifies the substance of the offences against s 92.3(1) of the Criminal Code to which it relates in the following terms: "Between about 1 July 2019 and 25 June 2020, John Shi Sheng ZHANG and others did, contrary to section 92.3(1) of the Criminal Code (Cth), intentionally engage in conduct, namely: (i) While acting on behalf of Chinese State and Party apparatus engaged, through a private social media chat group and in other fora, with Shaoquett MOSELMANE, an elected Australian official, to advance the interests and policy goals of a foreign principal, being the Government of the People's Republic of China (PRC), in encouragement Australia by providing MOSELMANE for the advocacy of Chinese State interests, and support and In doing so was reckless that the conduct would influence the political process of an Australian State or Commonwealth or influence the exercise in Australia of an Australian democratic or political right or duty, in that the conduct would influence the NSW branch of the Australian Labor Party's policy positions on the PRC and the views of members of the NSW electorate in regard to the PRC; and (iii) A part of the conduct was covert, in that it involved communications over a private Social Media Chat Group." Mr Zhang's argument that each warrant fails to comply with s 3E(5)(a) of the Crimes Act in that it insufficiently identifies the substance of the offences against s 92.3(1) is confined to an argument that each warrant is "unclear" as to the identity of the foreign principal. The argument is untenable. Each warrant in terms identifies the foreign principal as the Government of the PRC, which is a "foreign government principal" within the definition in s 90.3(a). Notwithstanding his initial choice to challenge the validity of the whole of s 92.3(1) of the Criminal Code, Mr Zhang developed his argument that each warrant failed to authorise search and seizure of "evidential material" as defined in s 3C(1) of the Crimes Act in relation to offences against s 92.3(1) on an acceptance that the various sub-paragraphs of s 92.3(1)(b), (c) and (d) would be capable of severance under s 15A of the Acts Interpretation Act 1901 (Cth) in the event of invalidity. Focusing on the substance of the offences against s 92.3(1) identified in the warrants, his challenge was refined in the course of oral argument to a challenge to s 92.3(1)(a) ("the person engages in conduct") read with the first part of s 92.3(1)(b)(i) ("the conduct is engaged in on behalf of ... a foreign principal"), s 92.3(1)(c)(i) and (ii) ("the person is reckless as to whether the the conduct will Commonwealth or a State or Territory ... or ... influence the exercise (whether or not in Australia) of an Australian democratic or political right or duty") and the first part of s 92.3(1)(d)(i) ("any part of the conduct ... is covert"). That permutation of s 92.3(1), he argued, infringes the implied freedom of political communication. influence a political or governmental process of Mr Zhang's argument that the permutation of s 92.3(1) infringes the implied freedom of political communication was ultimately explained in the course of its oral presentation to depend on a wide reading of the word "covert" in s 92.3(1)(d)(i): equating "covert" with "private" or "not overt". What became apparent was that he did not contend that on all available constructions of the word would the permutation offend the implied freedom of political communication. That is to say, he did not assert that the word could not be read down in accordance with the principle of construction referred to in Residual Assco Group Ltd v Spalvins3 to ensure validity if the wide reading for which he contended did lead to invalidity. Intervening in support of the Commissioner of Police, the Attorney-General of the Commonwealth responded by proffering a narrower reading of the word "covert" in s 92.3(1)(d)(i): treating "covert" as involving some element of nefarious concealment or secrecy. Departing from the view implicitly taken in the framing of the search warrants, the Attorney-General did not argue that communication can answer the description of "covert" merely because it occurs over a private social media chat group but did argue that a choice to communicate using an encrypted social media platform can answer the description of "covert" in some circumstances. The Attorney-General was disinclined to be definitive as to when those circumstances might exist. Just as the reference to conduct that "involves deception" is sufficiently generic to cover deception of different people in respect of different things by different means, the Attorney-General argued, the reference to conduct that is "covert" is sufficiently generic to cover concealment of different things from different people through the adoption of different guises. Implicit in Mr Zhang's failure to assert that the word "covert" in s 92.3(1)(d)(i) would be incapable of being read down to ensure validity was an acknowledgement that those parts of s 92.3(1) which support the offences against s 92.3(1) to which each warrant relates (being s 92.3(1)(a) read with the first part of s 92.3(1)(b)(i), s 92.3(1)(c)(i) and (ii) and the first part of s 92.3(1)(d)(i)) have some valid operation. That being so, his argument that those offences do not exist can be rejected without need of determining the constitutional argument he presents and without need of determining the attendant question of the proper construction of the word. And although the search warrants might be read as having been drafted on the understanding that conduct might be "covert" by reason only that it "involved communications over a private Social Media Chat Group", (2000) 202 CLR 629 at 644 [28]. any necessary reading down of the word "covert", such as requiring an element of nefarious concealment or secrecy, would not deprive the warrants of sufficient content or clarity to indicate the areas of the search4. That approach to the resolution of the issues raised on the hearing of the special case accords with the unanimous reaffirmation in Knight v Victoria5 of the unanimous observation in Lambert v Weichelt6 that "[i]t is not the practice of the Court to investigate and decide constitutional questions unless there exists a state of facts which makes it necessary to decide such a question in order to do justice in the given case and to determine the rights of the parties". The Court explained in Knight7 that "it is ordinarily inappropriate ... to be drawn into a consideration of whether a legislative provision would have an invalid operation in circumstances which have not arisen and which may never arise if the provision, if invalid in that operation, would be severable and otherwise valid". It is similarly ordinarily inappropriate in such circumstances to be drawn into a consideration of whether a legislative provision would be invalid if construed one way if the provision would be capable of being construed another way to have some valid operation to the facts before the Court. In Clubb v Edwards8, Kiefel CJ, Bell and Keane JJ emphasised that the practice articulated in Lambert and explained in Knight is "not a rigid rule imposed by law which cannot yield to special circumstances" but is the "usual practice" which is "based upon prudential considerations". Prudential considerations supporting the practice include not only "avoiding the formulation of a rule of constitutional law broader than required by the precise facts to which it is to be Smethurst v Commissioner of the Australian Federal Police (2020) 94 ALJR 502 at 517 [28], 551 [207]; 376 ALR 575 at 584, 629. (2017) 261 CLR 306 at 324 [32]. (1954) 28 ALJ 282 at 283. (2017) 261 CLR 306 at 324 [33]. (2019) 267 CLR 171 at 192-193 [35]-[36], quoting Universal Film Manufacturing Co (Australasia) Ltd v New South Wales (1927) 40 CLR 333 at 350-351. applied" but also "avoiding the risk of premature interpretation of statutes on the basis of inadequate appreciation of their practical operation"9. Though different views have been expressed by different members of the Court as to the application of the practice in particular cases10, the present case is a particularly strong one for adherence to the practice. No less than the word "deceptive", the word "covert" in s 92.3(1)(d)(i) is on any view susceptible of a range of arguable applications involving a spectrum of arguable shades of meaning. In the present context of a challenge to search warrants, consideration of that range of arguable applications and spectrum of arguable shades of meaning was shown by the course of argument to involve an exercise in imagination. In the context of a criminal prosecution, in contrast, the preferable shade of meaning would fall to be determined (on demurrer or appeal) by reference to the precise way the prosecution sought to particularise and to prove its case. And it would fall to be determined with the assistance of argument honed by a focus on realistic outcomes aligned to the interests of the parties. Lacking in the present case is "that clear concreteness provided when a question emerges precisely framed and necessary for decision from a clash of adversary argument exploring every aspect of a multi-faced situation embracing conflicting and demanding interests"11. Worse in the present case is that the lack of concreteness is accompanied by incentives for argument that run counter to the administration of justice in an adversary system. Tajjour v New South Wales (2014) 254 CLR 508 at 588 [174]. 10 See Clubb v Edwards (2019) 267 CLR 171 at 193-194 [36]-[40], 216-221 [135]- [148], 287-289 [329]-[337] and Private R v Cowen (2020) 94 ALJR 849 at 874 [107], 886 [159]; 383 ALR 1 at 28-29, 44. 11 Mellifont v Attorney-General (Q) (1991) 173 CLR 289 at 318, quoting United States v Fruehauf (1961) 365 US 146 at 157. See also Kuczborski v Queensland (2014) 254 CLR 51 at 109 [186]. In North Australian Aboriginal Justice Agency Ltd v Northern Territory, "A plaintiff who chooses to pursue a strategy of invalidation of a statute may be disposed to assert that the challenged statute has an expansive operation in order to optimise the prospect that it will be held to have overreached constitutional limits. That may mean that arguments available to other persons affected by the statute, whose interests would be advanced in a practical way by a narrower interpretation of the statute, are pre- empted, without being heard, in the single-minded pursuit by the plaintiff of the constitutional issue." Conversely, his Honour noted13: "[A] party in whose interest it is to defend the constitutional validity of the legislation will naturally be disposed to accept, or indeed to urge, a narrow view of the operation of the legislation in order to optimise the prospects that it will be held to be valid. In the course of later proceedings to enforce the statute, that same party might be disposed to urge a more expansive view." To similar effect, in terms applicable equally to the present case, Gageler J observed14: "The arguments divide along battlelines not unfamiliar where questions about the constitutional validity of a law are abstracted from questions about the concrete application of that law to determine the rights and liabilities of the parties. The party seeking to challenge validity advances a literal and draconian construction, even though the construction would be detrimental to that party were the law to be held valid. The party seeking to support validity advances a strained but benign construction, even though the construction is less efficacious from the perspective of that party than the literal construction embraced by the challenger. The (2015) 256 CLR 569 at 626-627 [150]. (2015) 256 CLR 569 at 627-628 [152]. (2015) 256 CLR 569 at 604 [75]. constructions advanced reflect forensic choices: one designed to maximise the prospect of constitutional invalidity; the other to sidestep, or at least minimise, the prospect of constitutional invalidity. A court should be wary." The questions reserved by the parties in the special case are appropriately answered as follows: (1) Are the First Search Warrant, the Second Search Warrant, and the Third Search Warrant invalid, in whole or in part, on the ground that: they misstate the substance of s 92.3(2) of the Criminal Code (Cth)? they fail to state the offences to which they relate with sufficient precision? s 92.3(1) of the Criminal Code (Cth) is invalid on the ground that it impermissibly burdens freedom of political communication? implied the s 92.3(2) of the Criminal Code (Cth) is invalid on the ground that it impermissibly burdens freedom of political communication? implied the Answer The First Search Warrant, the Second Search Warrant and the Third Search Warrant are not wholly invalid on any of the identified grounds. The question is otherwise unnecessary to answer. In light of the answer to Question 1, is the First s 3LA Order and/or the Second s 3LA Order invalid? Answer Is s 92.3(1) of the Criminal Code (Cth) invalid on the ground that it impermissibly burdens the implied freedom of political communication? Answer Unnecessary to answer. Is s 92.3(2) of the Criminal Code (Cth) invalid on the ground that it impermissibly burdens the implied freedom of political communication? Answer Unnecessary to answer. If the answer to any or all of the questions (1)–(4) is "yes", what relief, if any, should issue? Answer None. (6) Who should pay the costs of the proceeding? Answer The plaintiff.

HIGH COURT OF AUSTRALIA MZXOT AND PLAINTIFF MINISTER FOR IMMIGRATION AND CITIZENSHIP DEFENDANT MZXOT v Minister for Immigration and Citizenship [2008] HCA 28 18 June 2008 ORDER The questions reserved in the case stated dated 8 November 2007 be answered as follows: Is the effect of sections 476, 476A, 476B and 484 of the Act, read with the definition of "migration decision" in sections 5, 5E and 474, that the only Court that can hear and determine an application for any or all of: the constitutional writs of prohibition and mandamus; the constitutional remedy of injunction against an officer of the Commonwealth; the public law remedy of certiorari; the public law remedy of declaration in a suit against the Commonwealth or a person being sued on behalf of the Commonwealth, in respect of a "primary decision" (as defined in s 476(4)), is the High Court of Australia? Yes. If the answer to Question 1 is "Yes", are any or all of sections 476, 476A, 476B and 484 of the Act invalid: because they curtail, limit or impair, either directly or as a matter of practical effect, the constitutional role of this Court? because they curtail, limit or impair, either directly or as a matter of practical effect, the right or ability of applicants to seek the relief identified in paragraphs (a)-(d) of Question 1? Unnecessary to answer. If the answer to Question 1 is "Yes", are any or all of sections 476, 476A, 476B and 484 of the Act, and/or sections 38(e) and 39(1) of the Judiciary Act 1903 (Cth) invalid in so far as they apply to "migration decisions" (as defined): because they are contrary to an implied power of this Court to remit to another court an application commenced in this Court for the relief identified in paragraphs (a)-(d) of Question 1? because they impair or frustrate the exercise of an implied power of this Court to decline to hear an application commenced in this Court for the relief identified in paragraphs (a)-(d) of Question 1, on the basis that another court is a more appropriate court? Section 476(2)(a) and s 476(2)(d) are not invalid. It is unnecessary to answer the balance of the question. If the answer to Question 1 is "No", or the answer to Question 2 or to Question 3 is "Yes", should this matter be remitted to another court and, if so, to which court? Does not arise. Q5. Who should bear the costs of the case stated in this Court? The plaintiff should pay the costs of the case stated. Representation D S Mortimer SC with L G de Ferrari and C P Young for the plaintiff (instructed by Victoria Legal Aid (Civil Law Section)) D M J Bennett QC, Solicitor-General of the Commonwealth with S P Donaghue for the defendant and for the Attorney-General of the Commonwealth intervening (instructed by Australian Government Solicitor) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS MZXOT v Minister for Immigration and Citizenship High Court – Original jurisdiction – Section 77(i) of Constitution gave the Parliament power to define jurisdiction of federal court other than High Court – Section 476(2)(a) of Migration Act 1958 (Cth) ("Migration Act") provided that Federal Magistrates Court ("FMC") had no jurisdiction in relation to "a primary decision" – Section 476B(2) of Migration Act provided that High Court must not remit matter relating to migration decision to FMC unless FMC had jurisdiction under s 476 – Decision of delegate of defendant to refuse application of plaintiff for protection visa "a primary decision" – Plaintiff applied for mandamus in original jurisdiction of High Court conferred by s 75(v) of Constitution, and also certiorari – Plaintiff sought to have application remitted to FMC – Whether High Court had implied power to remit matter commenced in original jurisdiction to FMC in absence of supporting law made by the Parliament – Whether ss 476 and 476B of Migration Act invalid to extent sections imposed barrier to remitter upon High Court – Whether FMC had authority to receive remitted application in absence of supporting law made by the Parliament – Whether implied constitutional power in High Court to remit, and in FMC or State court to receive, matter so as to protect constitutional jurisdiction of High Court – Whether necessity for implied power of remittal of matter demonstrated by facts in stated case and otherwise within judicial knowledge. Constitutional law (Cth) – Courts – Jurisdiction – Whether jurisdiction to make orders of certiorari and mandamus against officer of Commonwealth "belonged to" State courts in absence of law made by the Parliament investing State courts with federal jurisdiction – Whether s 109 of Constitution operated with respect to ss 38 and 39(1) of Judiciary Act 1903 (Cth) to render State laws otherwise providing for jurisdiction of State courts inoperative – Whether heads of jurisdiction in ss 75 and 76 of Constitution identifying controversies unknown before federation could be said to "belong to" State jurisdiction. High Court – Original jurisdiction – Whether there are limitations upon power of the Parliament under s 76(ii) of Constitution to burden exclusively High Court with original jurisdiction. Words and phrases – "federal jurisdiction", "original jurisdiction", "remitter". Constitution, ss 75(v), 76(ii), 77, 109. High Court Rules 2004, rr 4.02, 25.06.1, 25.07.2. Judiciary Act 1903 (Cth), ss 38, 39. Migration Act 1958 (Cth), ss 476, 476A, 476B, 484. GLEESON CJ, GUMMOW AND HAYNE JJ. The litigation is a sequel to changes made to the Migration Act 1958 (Cth) ("the Act") by the Migration Litigation Reform Act 2005 (Cth) ("the 2005 Act"). The 2005 Act introduced provisions by which the Parliament sought to impose time limits upon applications to the Federal Magistrates Court ("the FMC"), the Federal Court and this Court. The limits were uniform but of such short duration as to deny access to federal jurisdiction to applicants whose delay might not be the result of gross delay or culpable error. In the second reading speech on the Bill for the 2005 Act, the Attorney-General said1: "The bill provides uniform extendable time limits in the High Court, the Federal Court and the [FMC]. The time limit measures provide a balance between giving applicants an opportunity to seek judicial review of migration decisions and ensuring these applications." timely handling of The Attorney-General also said2: "Migration cases filed in the High Court's original jurisdiction and remitted will be directed to the [FMC]. Further, the bill expressly provides that the High Court may remit on the papers without hearing. This is an appropriate efficiency for the handling of all matters filed in the High Court. The High Court is the apex of our judicial system. It should not be burdened with cases that are more appropriately handled by a lower court." The legislative scheme has failed to achieve these objectives. In Bodruddaza v Minister for Immigration and Multicultural Affairs3 this Court held that the provisions of the 2005 Act imposing time limits upon applications in the original jurisdiction directly conferred upon the High Court by s 75 of the Constitution were invalid. There was no challenge to the validity of the time limits with respect to the FMC and the Federal Court. 1 Australia, House of Representatives, Parliamentary Debates (Hansard), 10 March 2 Australia, House of Representatives, Parliamentary Debates (Hansard), 10 March (2007) 228 CLR 651; [2007] HCA 14. Both the plaintiff and the defendant ("the Minister") are agreed that the effect of relevant provisions in the Act respecting time limitations4 and of the decision in Bodruddaza5 is that the only court with jurisdiction to grant the relief the plaintiff seeks by way of certiorari and mandamus is this Court. The purpose of s 75(v) is to make it constitutionally certain that there is a jurisdiction to restrain officers of the Commonwealth from exceeding federal power6 and it was affirmed in Bodruddaza that the jurisdiction of this Court in a matter falling within s 75(v) of the Constitution is entrenched7. The plaintiff wishes to achieve the result that, despite the absence of legislative authority, his application to this Court is remitted to the FMC. Before turning to consider his submissions something should be said respecting the facts. The facts The plaintiff was born in Nigeria in 1960 and is a Nigerian citizen. On 14 March 2006, whilst lawfully present in Australia as the holder of a Business (Short Stay) visa, he made an application for a protection visa. That application was refused by a delegate of the Minister on 18 April 2006. A copy of the decision of the delegate was sent under cover of a registered letter dated 18 April 2006. The letter was addressed to the plaintiff at the last address the plaintiff had given. There followed after an interval of some nine months a series of litigious forays which have culminated in an action in the original jurisdiction of this Court. On 6 February 2007 and after he had been contacted by telephone by an officer of the Minister's Department, the plaintiff instituted in the FMC an application for judicial review of the decision of the delegate. It was only on 16 March 2007 that the plaintiff first received a copy of the letter dated 18 April 4 Sections 476, 476A, 476B and 484, read with the definition of "migration decision" in ss 5, 5E and 474. The text of these provisions is set out in the reasons of Heydon, Crennan and Kiefel JJ. (2007) 228 CLR 651. 6 Bank of NSW v The Commonwealth (1948) 76 CLR 1 at 363; Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82 at 90-91 [14], 138-139 [155]; [2000] HCA 57. 7 Bodruddaza v Minister for Immigration and Multicultural Affairs (2007) 228 CLR 651. 2006 and of the decision of the delegate. On 28 March 2007 the Minister filed an objection to the competency of the application made on 6 February 2007 and relied upon various grounds of objection. One was that by reason of par (a) of s 476(2) of the Act the FMC had no jurisdiction in the matter. The substance of this objection was that the decision of the delegate would have been reviewable elsewhere, namely by the Refugee Review Tribunal ("the RRT") under Pt 7 of the Act, if application had been made to the RRT within time. The FMC proceeding was discontinued on 3 May 2007. In the meantime, on 29 March 2007 the plaintiff made an application to the RRT. On 25 May 2007 the RRT determined it had no jurisdiction. Paragraph (b) of s 412(1) of the Act required that an application for review be made to the RRT within the prescribed period. In the present case this required the lodgement of the application for review at a registry of the RRT within a period not later than 28 days after the day on which the applicant received notice of the decision. The plaintiff was taken to have received on 28 April 2006 the notice of the decision sent by registered post on 18 April 2006. The time limit operated in this way although in fact the plaintiff had received the notification and a copy of the decision only on 16 March 2007. The result was that the 28 day period within which the application had to be lodged with the RRT had ended on 26 May 2006. The application made by the plaintiff had not been received by the RRT until many months later, on 29 March 2007. In anticipation of this outcome in the RRT, the plaintiff on 11 April 2007 invoked the original jurisdiction of this Court conferred by s 75(v) of the Constitution. As later amended, the relief sought in the plaintiff's application for an order to show cause includes certiorari to quash the decision of the delegate of the Minister made 18 April 2006 and mandamus directing the Minister to determine according to law the plaintiff's application for a protection visa. Certiorari is not listed in s 75(v), but may issue as ancillary to the constitutional writ of mandamus8. The High Court Rules 20049 specify time limits within which applications for certiorari and mandamus must be made, but these, unlike those imposed by statute on the FMC and the RRT, are not absolute. The plaintiff seeks an enlargement of time under the High Court Rules10. 8 Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476 at 507 [80]; [2003] HCA 2; Bodruddaza v Minister for Immigration and Multicultural Affairs (2007) 228 CLR 651 at 672-673 [61]-[64]. 9 Rule 25.06.1 (Certiorari) and r 25.07.2 (Mandamus). 10 Rule 4.02. The case stated The case stated for the Full Court pursuant to s 18 of the Judiciary Act 1903 (Cth) ("the Judiciary Act") asks questions which put in issue the validity of provisions of the Act and the Judiciary Act in so far as they impair or frustrate the exercise of what the plaintiff submits is "an implied power" in the High Court to remit his application to another court. By a favourable answer to Question 4 of the case stated the plaintiff wishes to have his application remitted by order of this Court to the FMC. But as the legislation stands that outcome is not possible. Section 476(1) of the Act provides that, subject to that section, the FMC has the same original jurisdiction in relation to migration decisions as does this Court under s 75(v) of the Constitution. However, par (a) of s 476(2) states that the FMC has no jurisdiction in relation to "a primary decision"; that term is defined in s 476(4) so as to include "a privative clause decision or purported privative clause decision" that would have been reviewable under Pt 7 (dealing with reviews by the RRT of protection visa decisions) if an application for that review had been made within the specified period. It is accepted by the parties that the decision of the delegate in the present case answered the definition of "primary decision" in s 476(4). The result is that s 476 does not confer any jurisdiction on the FMC to deal with the plaintiff's application for relief identified in s 75(v) of the Constitution. On its face, s 476, in its application to the decision of the delegate of which the plaintiff seeks judicial review, is a law defining the jurisdiction of a federal court, other than this Court, with respect to a matter mentioned in s 75(v) of the Constitution. A law of that description is supported by the power conferred upon the Parliament by s 77(i) of the Constitution. This states: "77 Power to define jurisdiction With respect to any of the matters mentioned in the last two sections the Parliament may make laws: defining the jurisdiction of any federal court other than the High Court". As to the position of the High Court itself, the starting point is s 44 of the Judiciary Act. This would empower the High Court to remit the plaintiff's application for relief under s 75(v) of the Constitution to the FMC if the FMC had jurisdiction "with respect to the subject-matter and the parties". However, s 44(1) must now be read with s 476B of the Act. Section 476B(2) states: "The High Court must not remit a matter, or any part of a matter, that relates to a migration decision to the [FMC] unless that court has jurisdiction in relation to the matter, or that part of the matter, under section 476." As just explained, the effect of s 476 is that the FMC does not have jurisdiction in relation to the matter in question here. The issues Against that background three interrelated issues are presented by the plaintiff. The first asserts invalidity of the provisions of ss 476 and 476B of the Act and, in particular, of the barrier to remitter imposed upon the High Court by s 476B(2). As to the second issue, the plaintiff asserts the existence of authority in this Court, even in the absence of a supporting law made by the Parliament, to remit the plaintiff's application for consideration and determination by the FMC. Thirdly, the plaintiff contends that there exists authority in the FMC, in the absence of any support by a law of the Parliament, to receive that remitter and consider and determine the plaintiff's application for certiorari and mandamus. With respect to all three issues the plaintiff founds his case upon the existence of a necessary implication in the text and structure of Ch III of the Constitution. He submits that ss 476 and 476B are invalid because they oblige the High Court to exercise exclusively and without remitter the jurisdiction conferred by s 75(v) of the Constitution with respect to certain decisions by the Minister under the Act. The case presented by the plaintiff in its broader form, and as it appears in the written submissions, is that the High Court: "has an implied power to remit any matter commenced in its original jurisdiction to another court and that if a law of the Parliament purports either to prohibit the exercise of that power, or to deny jurisdiction to all receiving courts to hear and determine remitted matters, then that law directs the manner and outcome of the exercise of this Court's jurisdiction and is an impermissible interference with the exercise of judicial power by this Court". State courts It is convenient first to consider a related but distinct submission by the plaintiff which concerns the jurisdiction of the courts of the States. In the course of oral submissions counsel for the plaintiff emphasised that the general expression "another court" used in the written submissions to identify the "receiving courts" was not limited to the FMC or another federal court; rather, the expression included State courts with jurisdiction generally in relation to the same kinds of parties and subject matter as were present in the High Court litigation. In particular, the plaintiff submits that the source of this jurisdiction in the State courts need not be a law of the Parliament conferring federal jurisdiction under s 77(iii) of the Constitution. There was no such federal law which applied to the plaintiff's litigation. But, the submission proceeded, that was not determinative because the necessary jurisdiction "belonged to" the courts of the States without the need for a law investing them with federal jurisdiction. It should be said immediately that the following remarks of Gleeson CJ, Gaudron and Gummow JJ in Australian Securities and Investments Commission v Edensor Nominees Pty Ltd are pertinent here11: "The relationship between federal jurisdiction and State jurisdiction is not to be approached from a vantage point where the Supreme Courts are seen as superior to the operation of the Constitution by reason of their earlier establishment by or pursuant to12 Imperial legislation. It is, after all, s 73 of the Constitution which now ensures the continued existence of those Supreme Courts13." The submissions for the plaintiff sought to recognise this by emphasising the operation of the "supremacy clause" in covering cl 5 of the Constitution. This renders the Constitution (as set out by s 9 of the Commonwealth of Australia Constitution Act 1900 (Imp)14) "binding on the courts, judges, and people of every State ... notwithstanding anything in the laws of any State ...". However, that which is rendered "binding" is the federal scheme manifested in the text and structure of the Constitution. This includes Ch III and various inferences which have been held to follow necessarily from that federal 11 (2001) 204 CLR 559 at 592 [69]; [2001] HCA 1. 12 For example, the Supreme Court of New South Wales was established by an instrument issued by the Crown pursuant to power conferred by Imperial statute, not by an exercise of the Royal Prerogative. The matter is explained by Windeyer J in Kotsis v Kotsis (1970) 122 CLR 69 at 90-91, and by Professor Enid Campbell in "The Royal Prerogative to Create Colonial Courts", (1964) 4 Sydney Law Review 13 Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51 at 102-103, 14 63 & 64 Vict, c 12. scheme. The various powers conferred upon the Parliament by provisions in Ch III15 are necessarily exclusive of those of the State legislatures; and this is true of the conferring, defining and investing of federal jurisdiction16. It follows that a State legislature may not expand or contract the scope of the appellate jurisdiction of the Court conferred by s 73; or that of the original jurisdiction conferred by s 7517. With these considerations in mind it is convenient to return to the plaintiff's submission respecting the jurisdiction to issue mandamus against the Minister which is said to "belong to" the State courts. That submission should be rejected, and on several grounds. The first ground requires attention to s 77(ii) of the Constitution. This provides: "77 Power to define jurisdiction With respect to any of the matters mentioned in the last two sections the Parliament may make laws: defining the extent to which the jurisdiction of any federal court shall be exclusive of that which belongs to or is invested in the courts of the States". (emphasis added) The phrase "of any federal court" includes the High Court18. Sections 38 and 39(1) of the Judiciary Act render "the jurisdiction of the High Court ... exclusive of the jurisdiction of the several Courts of the States", subject to exceptions none of which apply to the plaintiff's proceeding in this Court. The phrase "the jurisdiction of the High Court" when used in ss 38 and 39(1) is apt to include original jurisdiction whether conferred directly by s 75 of the Constitution or by laws made by the Parliament from time to time under s 76 of the Constitution. 15 All sections of Ch III except s 75 contain provisions for the Parliament to legislate. 16 APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 405-406 [228]-[230]; [2005] HCA 44. 17 APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 405 18 Pirrie v McFarlane (1925) 36 CLR 170 at 176. These sections of the Judiciary Act answer the description of a standing provision constantly speaking to the present state of the jurisdiction of the High Court19. That which "belongs to" the State courts within the meaning of s 77(ii) is the authority they possess to adjudicate under the constitutions and laws of the States20. So long as ss 38 and 39(1) of the Judiciary Act stand unrepealed then, with respect to matters falling within the jurisdiction of the High Court, and in the words of Isaacs J, "no State jurisdiction can exist"21. However, as Taylor J and Menzies J indicated in Williams v Hursey22, this does not deny the existence of State jurisdiction in a suit which could not be tried in the exercise of federal jurisdiction23. The accepted view is that the denial of jurisdiction which otherwise "belongs to" the courts of the States manifests the operation of s 109 of the Constitution (with respect to the Judiciary Act provisions) upon the State laws which otherwise provide for the jurisdiction of the courts of the States24. Those State laws are rendered "inoperative"25. If this reasoning be applied to the present situation, it is by operation of s 109 of the Constitution that there is denied the competency of any State court, in the absence of a federal law investing it with federal jurisdiction, to adjudicate upon the action the plaintiff brings against the Minister for judicial review. But there is a further ground for that outcome. It proceeds from an appreciation of the federal structure established by the Constitution and may be explained as follows. Perusal of the nine paragraphs of ss 75 and 76 of the 19 Le Mesurier v Connor (1929) 42 CLR 481 at 503; see also, as to s 39(2) of the Judiciary Act, Forsyth v Deputy Commissioner of Taxation (2007) 81 ALJR 662 at 665 [2]-[3]; 233 ALR 254 at 255; [2007] HCA 8. 20 Baxter v Commissioners of Taxation (NSW) (1907) 4 CLR 1087 at 1142. 21 Baxter v Commissioners of Taxation (NSW) (1907) 4 CLR 1087 at 1142. 22 (1959) 103 CLR 30 at 88-89, 113. 23 See Cowen and Zines, Federal Jurisdiction in Australia, 3rd ed (2002) at 237-238. 24 Felton v Mulligan (1971) 124 CLR 367 at 412-413; Moorgate Tobacco Co Ltd v Philip Morris Ltd (1980) 145 CLR 457 at 471, 476. 25 Felton v Mulligan (1971) 124 CLR 367 at 412. Constitution discloses that while some identify controversies well known in the anterior body of general jurisprudence in the colonies (for example, actions in tort or contract between residents of the former colonies26), that was not so with respect to other heads of federal jurisdiction27. How then could the adjudication of these controversies be said to "belong to" State jurisdiction? If they could not be so described, there was no occasion for any later federal law to rely upon s 77(ii) and for s 109 of the Constitution then to render inoperative that which did not otherwise exist. The distinction was apparent to Inglis Clark, who wrote in 1901 and in advance of the enactment of the Judiciary Act. He observed28: "But in the absence of any legislation by the Parliament of the Commonwealth which excludes the jurisdiction of the State courts, they will have jurisdiction to declare and apply the laws of the Commonwealth in all cases in which the judicial power of the Commonwealth is not necessarily exclusive of the judicial power of the States; because the laws of the Commonwealth are operative in every State and are declared by the fifth introductory section to the Constitution to be binding on the courts, judges and people of every State and of every part of the Commonwealth." "The matters in respect of which the judicial power of the Commonwealth seems to be necessarily exclusive of the judicial power of the States, in the absence of any legislation by the Parliament of the Commonwealth conferring jurisdiction upon the courts of the States in respect of them, are the following:– 1. Matters in which the Commonwealth is a defendant: 2. Matters in which a State may be compelled under the Constitution to become a defendant: 26 See Mobil Oil Australia Pty Ltd v Victoria (2002) 211 CLR 1 at 33-34 [45]-[48], 36-37 [55]-[58]; [2002] HCA 27. 27 Kruger v The Commonwealth (1997) 190 CLR 1 at 171. 28 Studies in Australian Constitutional Law, (1901) at 177-178. 3. Matters in which a writ of mandamus or prohibition or an the an officer of against sought injunction Commonwealth. With regard to matters in which a State may be compelled under the Constitution to become a defendant, the State may of course authorize its own courts to exercise jurisdiction, and it may voluntarily submit itself to the jurisdiction of the courts of another State. The question of the power of a State court in the United States of America to issue a writ of mandamus to an officer of the United States to compel him to perform duties imposed upon him by a law of the United States came before the Supreme Court in the case of McClung v Silliman29; and the Supreme Court decided that the courts of the States had not any jurisdiction in such cases." Shortly thereafter, but also before the commencement of the Judiciary Act30, the New South Wales Full Court decided in Ex parte Goldring31 that a State court had no power to grant a mandamus to compel an officer of the Commonwealth (the Collector of Customs at Sydney) to perform duties imposed upon the officer by federal law, even if the duties were to be performed in the State in question32. Counsel for the Collector in Goldring (Sir Julian Salomons KC) had cited McClung v Silliman. A recently affirmed corollary of the reasoning in Goldring is that a State law cannot unilaterally vest functions under that law in officers of the Commonwealth, whose offices are created by federal law and who have the powers vested in them by that law33. In the United States, the circumstance that a State court had inherited the jurisdiction of the Court of King's Bench with respect to mandamus, and the operation of the Supremacy Clause in Art VI and the reservation of powers to the States by the 10th Amendment, did not have the consequence that mandamus 29 19 US (6 Wheat) 598 (1821). 30 On 25 August 1903. 31 (1903) 3 SR (NSW) 260. 32 Cowen and Zines, Federal Jurisdiction in Australia, 3rd ed (2002) at 46-47, 197; Bailey, "The Federal Jurisdiction of State Courts", (1940) 2 Res Judicatae 109 at 33 Bond v The Queen (2000) 201 CLR 213 at 219-220 [15]; [2000] HCA 13; R v Hughes (2000) 202 CLR 535 at 553 [31]; [2000] HCA 22. might issue from that State court to a federal officer. In Australia the same may be said of covering cl 5 of the Constitution. Writing after Goldring, in the second edition of The Constitution of The Commonwealth of Australia34 Harrison Moore gave several instances where, in the absence of a conferral of federal jurisdiction, State courts could not have power to adjudicate under State law. These included the issue of mandamus to a federal officer to perform a federal duty and the issue of habeas corpus to a federal officer. It is unnecessary to determine whether there holds true all of the instances given by Inglis Clark and Harrison Moore of the absence of jurisdiction which "belongs to ... the courts of the States", so that in those cases there is no occasion or need for exclusion by federal law based upon s 77(ii) of the Constitution. It is sufficient for the present case to point to the clear authority since Goldring35 that the mandamus the plaintiff seeks against the Minister here is one such instance. The plaintiff fails to make good the submission that his application may be dealt with by this Court on the footing that, federal jurisdiction apart, the State courts have jurisdiction with respect to the subject matter which "belongs to" them by reason of covering cl 5 of the Constitution. There remains for consideration the plaintiff's submissions respecting an implied power of remitter from the High Court. Implied power in the High Court The statement that "the High Court shall have original jurisdiction", which is made in s 75 of the Constitution with respect to the matters listed in that section, brings with it such powers as are incidental and necessary to the exercise of the jurisdiction36. The same result follows from the vesting by s 71 of the Constitution of "[t]he judicial power of the Commonwealth" in the High Court37. 35 (1903) 3 SR (NSW) 260. 36 cf DJL v Central Authority (2000) 201 CLR 226 at 240-241 [25]; [2000] HCA 17. 37 See United Mexican States v Cabal (2001) 209 CLR 165 at 180-181 [37]; [2001] HCA 60. What is incidental and necessary in this context has not been, and perhaps cannot be, exhaustively detailed. A power to deal with contempt is included38. So also is the power to stay orders, which is necessary to effectuate the grant of appellate jurisdiction by s 7339. A broad power to protect the procedures of the Court against abuse may well also be included40. This Court has said that the exercise by the Parliament of its powers under s 76 of the Constitution to confer further additional original jurisdiction upon the Court is a matter of "great significance", because the result may be to "impair its ability to discharge its major functions with despatch"41. Those major functions are, as to the original jurisdiction, the disposition of certain matters arising under or involving the interpretation of the Constitution, and as to the appellate jurisdiction the role, subject to the grant of special leave, as the final court of general appeal for the whole country42. Further, with respect to jurisdiction directly conferred by s 75 the Court has indicated that relief may be refused where there is another court with jurisdiction in the matter43. The Parliament recognised from the time of the enactment of the Judiciary Act over a century ago that it would overburden the High Court to leave it as the only court with the whole of the jurisdiction conferred by s 75 and the whole of the jurisdiction which might be conferred by the Parliament pursuant to s 76. The immediate answer was the use of the power conferred by s 77(iii) to enact the broadly expressed conferral by s 39 of the Judiciary Act of jurisdiction upon the several courts of the States. Section 39 is expressed in terms that do not distinguish between civil and criminal matters. Section 68 deals specifically with 38 Re Colina; Ex parte Torney (1999) 200 CLR 386 at 394-397 [15]-[25], 429 [113]; [1999] HCA 57. 39 United Mexican States v Cabal (2001) 209 CLR 165 at 180-181 [37]-[38]. 40 See Batistatos v Roads and Traffic Authority (NSW) (2006) 226 CLR 256 at 265-266 [9]-[13]; [2006] HCA 27. 41 Willocks v Anderson (1971) 124 CLR 293 at 299-300. 42 Re Minister for Immigration and Multicultural Affairs; Ex parte Abebe [No 2] (1998) 72 ALJR 630 at 633 [11]; 152 ALR 177 at 180; [1998] HCA 16; Re Minister for Immigration and Multicultural Affairs; Ex parte Durairajasingham (2000) 74 ALJR 405 at 407-408 [9]-[11]; 168 ALR 407 at 410; [2000] HCA 1. 43 R v Langdon; Ex parte Langdon (1953) 88 CLR 158 at 161; Re Jarman; Ex parte Cook (1997) 188 CLR 595 at 633-634. criminal jurisdiction and was adapted from s 2 of the temporary legislation the Punishment of Offences Act 1901 (Cth)44. In more recent times legislation consequent upon the establishment of other federal courts has diverted from the High Court what had become a burdensome jurisdiction conferred particularly by a range of laws supported by s 76(ii). The Commonwealth Solicitor-General, who appeared for both the Minister and, as intervener, the Attorney-General, in oral argument contended that there was no restraint upon the power of the Parliament to enact a repeal of all these measures and thereby burden exclusively the High Court with the full weight of original jurisdiction in federal matters. Such a state of affairs would, among other things, stultify the exercise of the appellate jurisdiction which is entrenched by s 73 of the Constitution. It would undermine the operation of Ch III which places this Court (subject to the obsolete provisions in s 74) at the apex of the judicial structure45. It is well recognised in the decisions of the Court that the powers of the Parliament conferred by the various heads of power conferred by the Constitution are not to be interpreted on the footing that the ends sought to be achieved by their exercise must appear desirable rather than absurd or inconvenient46. But a law, apparently based upon s 77(iii), which repealed ss 39 and 68 of the Judiciary Act would appear to strike at the effective exercise of the judicial power of the Commonwealth which is vested directly in the High Court by s 71 of the Constitution. Nor would it necessarily be decisive in this situation to invoke the principle that the legislative powers conferred by s 51 extend to the repeal of the whole or part of that which has been enacted47; the legislative powers conferred within Ch III may require special consideration. It is sufficient to conclude now that the submission put for the Commonwealth can hardly be said to be self-evidently correct. But the foregoing considerations do not render it incidental and necessary to the exercise of jurisdiction directly conferred upon this Court by s 75 of the Constitution that, in the absence of a law made by the Parliament under s 77 which confers on another court concurrent federal jurisdiction with respect to a 44 See Ah Yick v Lehmert (1905) 2 CLR 593 at 606-607. 45 Collins v Charles Marshall Pty Ltd (1955) 92 CLR 529 at 538-544. 46 New South Wales v The Commonwealth (Work Choices Case) (2006) 229 CLR 1 at 117-118 [188]; [2006] HCA 52. 47 Kartinyeri v The Commonwealth (1998) 195 CLR 337; [1998] HCA 22. particular class of case such as that involved here, the High Court has the power to decline itself to exercise its jurisdiction by remittal to another court selected by the High Court for the exercise of its jurisdiction. It is for the existence of such a power that the plaintiff contends. The plaintiff accepted the statement as to the making of implications which appears in Lange v Australian Broadcasting Corporation48. However, this would mean that an implication supporting that power of remitter could extend only so far as necessary to give effect to the provisions of Ch III and would have to be inherent in the constitutional text and structure. The text and structure of Ch III point away from the direction to which the plaintiff urges the Court. In Gould v Brown49 McHugh J, in a passage indicative of what was to be the reasoning in Re Wakim; Ex parte McNally50, said51: "The affirmative but limited grants of constitutional power to the Parliament of the Commonwealth negate its competency to invest the federal courts and the High Court with original and appellate jurisdiction except in accordance with ss 73, 75 and 76. In my view, logically these affirmative grants must also negative the power of other legislatures in the federation to invest the High Court and the federal courts with jurisdiction." That reasoning is applicable here. With respect to any of the matters mentioned in s 75 (and s 76) it is the Parliament which may make laws defining the jurisdiction of any other federal court and investing a State court with federal jurisdiction. It would be at variance with the scheme of Ch III for the High Court in effect to delegate the exercise of its jurisdiction to resolve the controversy represented by a s 75(v) matter to another federal court or to a State court, in either instance selected by the High Court itself. It is true that the usual consequence of the exercise by the High Court of its statutory power of remitter is that the Court, after making the order for remitter, is taken thereby to choose not to exercise further its original jurisdiction, at least where the whole of the matter has been remitted. In due 48 (1997) 189 CLR 520 at 567. 49 (1998) 193 CLR 346; [1998] HCA 6. 50 (1999) 198 CLR 511; [1999] HCA 27. 51 Gould v Brown (1998) 193 CLR 346 at 423 [122]. course thereafter it may be that the appellate jurisdiction under s 73 of the Constitution is invoked but that will be the last step in a sequence following the investment or conferral of original jurisdiction in the federal or State court concerned. That investment or conferral of jurisdiction occurs by operation of the statute, not by a decision of this Court. Since its commencement, the Judiciary Act has contained provisions both for the removal of causes into the High Court and for the remittal both of causes which should not have been removed and of actions commenced in the original jurisdiction. The provisions originally enacted as ss 40-44 of the Judiciary Act for removal of causes and for remittal of causes removed were derived immediately from United States precedent. This was found in the Act of March 3, 1875 Ch 13752. That statute provided for the removal of certain causes from State courts into the circuit courts of the United States and for the remanding to the original court of causes which should not have been removed. Some analogy in the procedures of the common law superior courts of record had been provided by the writ of procedendo. Where a cause had been removed into one of the Court of King's Bench, Common Pleas or Exchequer by certiorari from an inferior court and it transpired that the cause ought not to have been removed, then on the application of the aggrieved party the writ of procedendo might issue, addressed to the inferior court and requiring it to proceed with the cause from the stage it had reached when the writ of certiorari had been issued53. The occasion for this remedy in modern systems of procedure was considered by Lord Atkin in Great Western Railway Co v West Midland Traffic Area Licensing Authority54 and by McPherson JA in R v T55. Section 45 of the Judiciary Act, as enacted, went further than the United States precedent. It provided: 52 18 Stat Pt 3 470. 53 Chitty, Archbold's Practice of The Court of Queen's Bench, in Personal Actions and Ejectment, 8th ed (1847), vol 2 at 1156; Halsbury, The Laws of England, (1909), vol 10 at 202. 54 [1936] AC 128 at 140. 55 [1995] 2 Qd R 192 at 194. "(1) Any matter which is at any time pending in the High Court, whether originally commenced in the High Court or not, may be remitted for trial to any Court of a State which has federal jurisdiction with regard to the subject-matter and the parties. (2) The order remitting the matter may be made by the High Court, or a Justice sitting in Chambers, on the application of any party to the matter." What is important for the present case is that the High Court has never asserted authority, without a legislative basis, to remit for hearing by another court selected by the High Court a matter in respect of which under the Constitution and the laws made by the Parliament the High Court has exclusive jurisdiction. The plaintiff's authorities and precedents The plaintiff referred to Johnstone v The Commonwealth56. The issue in that case was whether an action in tort against the Commonwealth might, in exercise of the power conferred by s 44 of the Judiciary Act as it then stood, be remitted to the Supreme Court of any State or whether by reason of s 56 of the Judiciary Act the action might be remitted only to the Supreme Court of the State in which the cause of action had arisen. The decision of the majority was that s 44 empowered the Court to remit the action to the Supreme Court of any State and that s 56 did not require any other outcome. But, critically for the reliance the plaintiff seeks to place upon the outcome in Johnstone, Aickin J, one of the "the effect of s 44 is to confer federal jurisdiction on State courts in cases where this Court remits a case to them, and that federal jurisdiction is in those same matters in which this Court has federal jurisdiction by virtue of s 75 of the Constitution. ... This jurisdiction is conferred on the State courts by the Parliament, not by this Court. What s 44 does is not to authorize this Court to confer federal jurisdiction on the State courts. What it does is to confer federal jurisdiction on State courts in cases where this Court is authorized to remit the proceedings to State courts and does in fact so remit." 56 (1979) 143 CLR 398. 57 (1979) 143 CLR 398 at 408-409. It is true that the other members of the majority in Johnstone, Gibbs J58 and Murphy J59, did not express themselves with the same precision of language as Aickin J. But, however that may be, it is in the reasons of Aickin J that the statement of the doctrine of the Court is to be found. The plaintiff also referred to decisions of this Court in O'Neill v O'Connell60 and Lambert v Weichelt61. In the first of these cases, Dixon J said62: "But once the 'cause' is lawfully removed here, then the determination of the cause lies within the jurisdiction of this Court, which, unless it exercises the power conferred by s 42 or exercises its discretion to remit the whole or any part of it, may dispose of the matters in controversy and give what judgment and make what order appears right upon the facts and the law." Section 42 of the Judiciary Act as it then stood ("... the High Court shall proceed no further therein but shall dismiss the cause or remit it ...") imposed an obligation on the High Court where it appeared to the Court that a cause which had been removed did "not really and substantially arise under the Constitution or involve its interpretation"63. On the other hand s 45, the text of which is set out earlier in these reasons, conferred upon the High Court a power of remitter of any matter at any time pending in the High Court, whether originally commenced in the High Court or otherwise; that such an order might be made upon the application of any party and on the power of the Court was indicative of the exercise of a discretion. It is to s 45 that the reference by Dixon J in O'Neill to the exercise of the discretion of the High Court to remit should be understood. The same is true of the reference to O'Neill in Lambert64. It is so unlikely as to be virtually inconceivable that by the somewhat imprecise language used in these cases the Court is to be taken as having accepted a radical proposition as to the 58 (1979) 143 CLR 398 at 401-402. 59 (1979) 143 CLR 398 at 407. 60 (1946) 72 CLR 101. 61 (1954) 28 ALJ 282. 62 (1946) 72 CLR 101 at 125. 63 The phrase "not really and substantially" had its provenance in s 5 of the Act of March 3, 1875 Ch 137, 18 Stat Pt 3 470. 64 (1954) 28 ALJ 282 at 283. exercise of its jurisdiction which anticipates the submission now made by the plaintiff. The plaintiff referred to a provision in the Rules of Court contained in the Schedule to the High Court Procedure Act 1903 (Cth). Order XLI, r 29 provided for a writ, "called a writ of Procedendo", to be issued commanding a judicial tribunal to which prohibition had issued, nevertheless, to proceed as if the prohibition had not issued; procedendo might issue on any ground on which relief might be given against a judgment in an action. But both prohibition and procedendo were remedies administered by the High Court, and the second was ancillary to the anterior exercise by the High Court of its jurisdiction under s 75(v) of the Constitution. There is no precedent here in the practice of the Court which assists the plaintiff. Conclusions As explained at the commencement of these reasons, this litigation is the outcome of two circumstances. The first is the enactment of time limits upon the making of applications for judicial review of certain decisions under the Act which does not allow for failures by applicants, without any shortcomings on their part, to act within the stipulated period. The second is that the invalidity of that limitation system in its application to s 75(v) of the Constitution has the result that only this Court may entertain the plaintiff's case. The 2005 Act qualifies what otherwise is the broad power of remitter conferred upon the High Court by s 44 of the Judiciary Act. The practical effect of the 2005 Act is to preserve for determination exclusively in this Court those applications made outside the time limits that Act imposes with respect to the FMC and the Federal Court. However, the present magnitude of the burden thus placed on this Court is not such as to impair to a sufficiently significant degree the discharge of the other jurisdiction of the Court as to call into question the validity of the changes made in the 2005 Act. The plaintiff did not submit that there was such a degree of impairment. The plaintiff's case was put on a broader basis which requires a necessary implication as to the existence of a non-legislatively based remitter power of this Court. That case has not been made out. Orders The questions in the case stated should be answered as follows: Question 1: Yes. Question 2: Unnecessary to answer. Question 3: Section 476(2)(a) and s 476(2)(d) are not invalid. It is unnecessary to answer the balance of the question. Question 4: Does not arise. Question 5: The plaintiff should pay the costs of the case stated. Kirby KIRBY J. These proceedings, on a stated case65, raise questions about the Constitution that have not previously been decided. The first question is whether this Court, in the exercise of its original jurisdiction, has an implied power to remit proceedings to another court where to do so is necessary to attain justice and to protect the constitutional character and functions of the Court. If the answer to that question is affirmative, the second question concerns the validity of recent federal legislation. In its terms, such legislation restricts the broad statutory power of remittal, long enjoyed by this Court66, and purports to prohibit remittal to a federal court of proceedings commenced in this Court's Depending on the answer to these questions, a third question arises as to whether, either by federal law, State law or the Constitution itself, another court has jurisdiction to receive any such remittal from this Court. Without a court that is legally authorised to receive the matter, a constitutionally implied power of remittal could not exist. In that sense, the existence of a receiving court is the other side of the coin of the power in this Court to remit proceedings begun in its original jurisdiction. Ultimately, I have reached the same dispositive orders as the other members of this Court. Specifically, I agree in the conclusion expressed by Gleeson CJ, Gummow and Hayne JJ that "the present magnitude of the burden … placed on this Court is not such as to impair to a sufficiently significant degree the discharge of the other jurisdiction of the Court as to call into question the validity of the changes made"68 in the legislation which the plaintiff attacks to found his argument of an implied constitutional power of remittal. I therefore agree that the case for the existence of a "non-legislatively based remitter power of this Court" has "not been made out"69. This conclusion means that it is inessential to decide whether, had my conclusion been otherwise, the plaintiff had established the existence of a relevant receiving court. 65 Stated by Hayne J, pursuant to the Judiciary Act 1903 (Cth) ("the Judiciary Act"), s 18. See reasons of Heydon, Crennan and Kiefel JJ at [151]. 66 Judiciary Act, s 44. A broad remittal power existed from 1903. 67 Migration Act 1958 (Cth) ("the Act"), ss 476, 476A, 476B and 484 read with the definition of "migration decision" in ss 5, 5E and 474 of the Act. 68 Reasons of Gleeson CJ, Gummow and Hayne JJ at [53]. 69 Reasons of Gleeson CJ, Gummow and Hayne JJ at [54]. Kirby Although the plaintiff fails, his arguments are not meritless. Eventualities can be conceived where a power of remittal, beyond that conferred by legislation, might need to be implied in order to protect the essential constitutional character and functions of this Court. This would then require a valid receiving court. The recognition, ambit and consequences of any such power must be left to a future occasion. These reasons will explain my conclusions, expressed in that qualified way. The facts, proceedings and legislation The facts: The relevant facts and history of the proceedings are set out in other reasons70. The plaintiff invoked these facts to lay the foundations for his argument of injustice. The plaintiff applied unsuccessfully for a refugee protection visa. He contended that he did not receive actual notice of an adverse administrative decision made against him by a delegate of the respondent Minister. Due to innocent time default, he was denied any possible review on the merits, by the Refugee Review Tribunal, of his claim to be a "refugee"71 or consideration under the constitutional writs72 (or their statutory equivalents and supplements73) in the Federal Magistrates Court ("the FMC") or the Federal Court of Australia ("the FCA"). He submitted that this was the result of the scheme of legislation introduced by the Migration Litigation Reform Act 2005 (Cth) ("the 2005 Act") which aimed to limit the jurisdiction of the FCA and the FMC. The plaintiff argued that the constitutional offence presented by this legislative exclusion of the jurisdiction of those federal courts was rendered clear by the decision of this Court in Bodruddaza v Minister for Immigration and Multicultural Affairs74. This Court there held that s 486A of the Migration Act 1958 (Cth) ("the Act") was invalid so far as it purported to curtail or limit the entitlement of an applicant to seek relief in this Court under s 75(v) of the Constitution. The section was inconsistent with the irreducible jurisdiction there conferred on this Court75. Section 486A was also held to be invalid so far as it 70 Reasons of Gleeson CJ, Gummow and Hayne JJ at [6]-[9]; reasons of Heydon, Crennan and Kiefel JJ at [146]-[153]. 71 Within the Refugees Convention 1951 and Protocol. See the Act, s 36(2). 72 Constitution, s 75(v). 73 Judiciary Act, s 39B. 74 (2007) 228 CLR 651; [2007] HCA 14. 75 (2007) 228 CLR 651 at 672 [58]-[60]. Kirby purported to prevent this Court from affording relief by way of statutory certiorari in determining a "matter" for which jurisdiction was conferred by s 75(v) of the Constitution76. This was the factual starting point for the plaintiff's argument. In the exercise of this Court's constitutional powers to issue the writs named in s 75(v) of the Constitution (and, possibly, ancillary public law remedies to make such writs effective), the Parliament was not entitled to impose inconsistent restrictions on this Court. If that is so, was it then possible for the Parliament to block all avenues available to this Court to remit to other courts (and by which those courts could receive) such matters as were appropriate for remittal? Was such a legislative scheme constitutionally valid? Was preventing access to any other court constitutionally permissible for every instance where there had been a statutory time default, no matter how trivial, self-evidently meritorious or otherwise legally insignificant? To protect this Court's essential constitutional character and functions, was it necessary to imply a constitutional power to remit to another court and to find a statutory or constitutional power for such a court to receive the remitted "matter"? Explained in this way, the plaintiff's arguments assume a constitutional attractiveness and it is appropriate to explore them. Although without The proceedings and case stated: The other reasons in this matter describe the comparatively prompt response of the plaintiff, once he was made aware of the decision of the delegate, to assert his propounded status as a "refugee" and to challenge the delegate's determination adverse to his application. the plaintiff first legal endeavoured to challenge the decision by initiating proceedings in the FMC. When difficulties arose, inherent in the scheme of the Act as amended by the 2005 Act77, the plaintiff (by now with legal representation) applied to the Refugee Review Tribunal. It held that it lacked jurisdiction because of the failure to comply with the specified time provisions. In this Court, the plaintiff challenges the validity of that legislative scheme, which purports to curtail the power of this Court to remit to another court an application for relief by way of the constitutional writs and supporting public law remedies (certiorari or a declaration), commenced in this Court's original jurisdiction. representation, 76 (2007) 228 CLR 651 at 673 [64]. 77 Especially the Act, s 476(2)(a). See reasons of Heydon, Crennan and Kiefel JJ at Kirby The plaintiff's challenge led to the case stated in the terms described by my colleagues78. As noted, the questions were further confined during oral argument79. Additional constitutional questions arose during oral argument that were inherent to those formulated in the stated case. Such questions emerged as potential difficulties, even barriers, for the hypotheses of the argument advanced by the plaintiff concerning the ambit of the implied non-statutory power of remittal said to be enjoyed by this Court. Specifically, the necessity of a "receiving" court loomed larger during argument. It became clear that a constitutional power of remittal would only be effective and useful if a repository court existed (either federal, Territory or State). Such a court needed, by statute, or by the Constitution itself, to have the jurisdiction and power to determine the "matter" remitted to it. The legislation: The relevant provisions of the Act, as amended by the 2005 Act, appear in the reasons of Heydon, Crennan and Kiefel JJ80. By the end of oral argument it was common ground that, according to the Act as so amended, of the federal courts named in s 484(1) of the Act, only this Court was afforded jurisdiction under the Act in respect of a "primary decision"81. This conclusion requires an affirmative answer to question 1 of the stated case. this conclusion was necessarily that However, incompatible with the requirements of the Constitution. the plaintiff submitted The issues The legal duty of this Court is to answer the questions in the stated case so far as they remain live issues between the parties. Those questions essentially concern the implied constitutional power of remittal. So explained, they proffer two issues: The implied power of remittal: In the exercise of its original jurisdiction under the Constitution, does this Court have a power, implied from the Court's constitutional character and functions, to remit to another court a matter commenced in its original jurisdiction, as supplementary or 78 Reasons of Heydon, Crennan and Kiefel JJ at [151]. See also reasons of Gleeson CJ, Gummow and Hayne JJ at [10]-[13]. 79 Reasons of Heydon, Crennan and Kiefel JJ at [152]. 80 Reasons of Heydon, Crennan and Kiefel JJ at [154]-[159]. 81 As defined by ss 476(2)(a), 476(4) and 476A, read with ss 5E and 474(2). See reasons of Gleeson CJ, Gummow and Hayne JJ at [4], [11]-[13] and reasons of Heydon, Crennan and Kiefel JJ at [155]-[157]. Kirby alternative to any statutory powers of remittal conferred upon the Court by federal law? The prohibition on remittal: If this Court does have such an implied constitutional power of remittal, is a law that purports to forbid this Court from exercising its implied constitutional power of remittal invalid? Specifically, is s 476B of the Act invalid on that ground? The issues concerning the existence in this Court of an implied constitutional power of remittal are inextricably linked to the consequential issues involving the existence of a court with jurisdiction and power, proper to receive (and to decide) the remitted matter. In one sense, a conclusion that no Australian court (whether federal, Territory or State) exists with jurisdiction and power to receive and dispose of the remittal would necessarily cast in doubt the existence of an implied power of remittal in the first place. That approach subsumes the issues concerning "reception" of the "remittal" within the existence of the power of "remittal". In effect, it would make the answer to the questions in the stated case respond to both sides of the constitutional equation. For conceptual reasons, it is convenient to divide the issues presented by the problem of identifying a "receiving" court or courts. This was partly argued as distinct from, and additional to, the problems of the suggested remittal power as such. Thus, the additional issues concerning the existence of a valid "receiving" court are: The receiving court: If this Court has a power, implied from the Constitution, to remit to another court a matter commenced in this Court's original jurisdiction, is there in the present case a receiving court with the relevant jurisdiction and powers? (a) Obviously, the plaintiff propounded that a federal court (the FCA or the FMC) would have the relevant jurisdiction and power if certain provisions of the Act were held invalid as inconsistent with this Court's suggested implied constitutional power of remittal. Thus, would the powers of the FMC, as a relevant federal court, to receive a constitutional remittal from this Court arise under s 476(1) of the Act82 if s 476(2) of the Act were held to be constitutionally invalid? 82 The terms of s 476(1) of the Act are set out below at [139]. The sub-section confers on the FMC the same jurisdiction in relation to migration decisions as the High Court has under s 75(v) of the Constitution. Kirby If, because of the terms of the Act, no federal court has the jurisdiction and power to receive remittal under this Court's implied constitutional power, do the State Supreme Courts, as the residual repositories of the general judicial power of the Australian nation, envisaged by the Constitution, qualify as implied repositories of remittal of a matter from this Court, with their own implied jurisdiction and powers to determine any such remitted matter? (c) Otherwise, does an order of this Court pursuant to its implied constitutional power to remit to another court a matter commenced in this Court's original jurisdiction, necessarily confer upon that other court, without the need for a specific federal law, the jurisdiction and power to discharge the remittal? In effect, does that court exercise the jurisdiction of this Court by delegation, under authority derived directly from this Court's remittal order and thus from the Constitution itself? The legislative definition of jurisdiction: Whatever might otherwise be the determination regarding the implied constitutional power of this Court to remit to another court a matter commenced in this Court's original jurisdiction, could any such implied power exist contrary to an express law of the Parliament defining the jurisdiction of a federal court other than this Court; confining such jurisdiction to federal courts (such as the FCA and the FMC), and without any law investing a State court with the relevant federal jurisdiction? Specifically, in light of this Court's approach in Abebe v The Commonwealth83 regarding the power of the Parliament to "define" the jurisdiction of federal courts, could any implied power of remittal survive the Act's express legislative prohibition on remittal to federal courts, affording jurisdiction to federal courts exclusive of State courts in the subject matter of the plaintiff's proceedings? It is appropriate to separate the remittal and reception issues. The initial focus is upon the plaintiff's arguments for an implied constitutional power of remittal. Analysed in this way, unencumbered by the consequential problem of identifying a court with jurisdiction to receive such a remitted matter, the force of the plaintiff's primary constitutional contention may be better understood. But, of course, the inter-connection of the power to remit and the authority to receive jurisdiction cannot be forgotten. 83 (1999) 197 CLR 510 at 522 [20], 534 [50] per Gleeson CJ and McHugh J, 589-590 [229] of my own reasons, 605 [281] per Callinan J; [1999] HCA 14. Kirby The arguments for an implied power of remittal Starting point: constitutional text: There is nothing in the Constitution that expressly provides for "remittal" (or "remand") of a matter from one court in the integrated Judicature of the Commonwealth to another. The Constitution is not expressed at such a level of detail. Instead, the provisions of the Constitution contemplate that such particularity will be provided by a law made by the Parliament84 or by law declared to exist by the courts as necessarily implied in their creation and character as such and in the performance of their functions which have been provided for expressly. In Jackson v Sterling Industries Ltd85, with respect to the FCA, Wilson and "[T]he vesting of judicial power in the specific matters permitted by the Constitution [or directly vested by the Constitution] … carries with it such implied power as is necessarily inherent in the nature of the judicial power itself." So far as the express provisions of Ch III of the Constitution are concerned, the plaintiff emphasised one constitutional feature as providing a clue about the existence, or absence, of a power in this Court to remit matters in its original jurisdiction to other courts. Whilst in many other ways Ch III of the Australian Constitution copied features of Art III of the United States Constitution, in at least two respects it adopted a different course. The plaintiff invoked these divergences to support his contention that a power of remittal was to be implied out of necessity. The first distinctive feature, not copied in the Australian Constitution, is found in Art III s 2 par 2 of the United States Constitution, which says: "In all Cases affecting Ambassadors, other public Ministers and Consuls, and those in which a State shall be a Party, the supreme Court shall have original Jurisdiction. In all the other Cases before mentioned, the supreme Court shall have appellate Jurisdiction, both as to Law and Fact, with such Exceptions, and under such Regulations as the Congress shall make." 84 Hence the provisions in ss 76, 77 and 78 of the Constitution expressly providing that "the Parliament may make laws" and s 51(xxxix), being "matters incidental to the execution of any power vested by this Constitution in … the Federal Judicature". 85 (1987) 162 CLR 612 at 619; [1987] HCA 23. Kirby There is no equivalent obligatory assignment of exclusive original jurisdiction to this Court. Section 75(ii) of the Constitution includes "matters … affecting consuls or other representatives of other countries" in the original jurisdiction of this Court. However, in any such matter the Parliament may make laws to define the jurisdiction of other federal courts86 and to define the extent to which such jurisdiction shall be exclusive87. These provisions have helped Australia to avoid the problem that has arisen in the United States from the apparent purpose of the constitutional text to assign even trivial trials of offences by consuls to the Supreme Court itself88. The second distinctive feature of the Australian Constitution is s 77(iii) which empowers the Parliament to make laws investing any court of a State with This so-called "autochthonous expedient"89 has no federal jurisdiction. equivalent in the United States Constitution. The provisions of s 77(iii), together with those envisaging the creation of federal courts below this Court90, make it clear that an exclusive discharge by this Court of matters included by s 75 as within its original jurisdiction was not, as such, part of the necessary constitutional design. On the contrary, the envisaged facility for divesting such jurisdiction to other federal (including Territory) courts and to State courts, together with the large emphasis in Ch III upon the appellate jurisdiction of this Court91, make it plain that it was always contemplated that this Court would be preoccupied by its appellate jurisdiction. This anticipation has been confirmed by the actual business of the Court since it commenced the exercise of its jurisdiction in 1903. 86 Constitution, s 77(i). 87 Constitution, s 77(ii). 88 cf Maryland v Louisiana 451 US 725 at 739-740 (1981); California v West Virginia 454 US 1027 (1981) per Stevens J (diss) relying on 28 USC §1251(a) whereby Congress enacted that "[t]he Supreme Court shall have original and two or more States". exclusive Notwithstanding this provision, in California v West Virginia, a case to which the statute applied, the majority denied a motion for leave to file a bill of complaint in the Supreme Court. jurisdiction of all controversies between 89 R v Kirby; Ex parte Boilermakers' Society of Australia ("Boilermakers") (1956) 94 CLR 254 at 268; [1956] HCA 10. 90 Constitution, ss 71, 77(i) and (ii). 91 Constitution, s 73. See also s 74. Kirby From this conception of the "Federal Supreme Court" for which the Constitution provides92, the plaintiff argued that means must exist to protect this Court from becoming overwhelmed by cases that have no special national, federal or legal significance. To a large extent, it might be expected that such protection would be enacted by the Parliament. This could be achieved by providing this Court with a large general power to remit matters, which could then be received and disposed of by other federal (including Territory) or State courts. That has been done by enactment93. Other means have been used to divert to other courts matters lying within the original jurisdiction of this Court94. Whilst these initiatives of the Parliament were within the contemplation of the Constitution and aimed to protect this Court's jurisdiction, the plaintiff argued that this Court could not be left without a means of self-protection where that proved necessary. This was so at least where the protection by or under laws made by the Parliament proved inadequate or (as was suggested in this case) where the jurisdiction was distorted in a way that was bound to increase the number of cases in the original jurisdiction of this Court, without reserving any effective control to the Court itself. The plaintiff complained that this was the offence to the Constitution caused by the terms of the amendments to the Act, particularly the contested provisions of the 2005 Act. To overcome this problem, the plaintiff submitted that there was an implied power of remittal to divest this Court of excessive, inappropriate or unnecessary jurisdiction. Test for implied powers: So far as the derivation of implications is concerned, the text of the Constitution pulls in opposite directions. The sparse language, the ever-changing political, economic and social conditions to which the text must respond and the extreme difficulty of achieving formal amendments lend support to a recognition of the existence of implications that expand upon the text, in ways not inconsistent with its language, structure, history and purposes. On the other hand, once declared, such implications are themselves part of the Constitution and are extremely difficult to change. Because they lack, as such, the democratic endorsement that the text itself enjoys (having been 92 Constitution, s 71. 93 See Judiciary Act, s 44. 94 For example, by the creation of the Federal Court of Bankruptcy, followed later by other federal courts such as the FCA and the FMC. Kirby endorsed by the electors95), this Court has exercised great restraint in deriving implications. Effectively, implications have been confined to those matters deemed truly necessary to give effect to the express constitutional provisions96. The plaintiff accepted this strict criterion for the derivation of an implied power of remittal in this Court. He contended that the necessity of a power of remittal could be seen as "logical or practical" or "implicit in the … structure" of Ch III and in the character and functions of this Court97. In the past, significant constitutional implications have been upheld by decisions of this Court98. Such implications have sometimes proved controversial99 and some have been disputed within the Court100. For the plaintiff, it was self-evident, and certainly necessary to the text of the Constitution governing the original jurisdiction of this Court, that the Court would possess an ultimate power, implied from the Constitution, to protect itself from being diverted from its essential constitutional and appellate functions into 95 cf Constitution, s 128; and see Kirmani v Captain Cook Cruises Pty Ltd [No 1] (1985) 159 CLR 351 at 441-442 per Deane J; [1985] HCA 8; McGinty v Western Australia (1996) 186 CLR 140 at 230 per McHugh J. 96 Lange v Australian Broadcasting Corporation (1997) 189 CLR 520 at 567; [1997] HCA 25; Kruger v The Commonwealth (1997) 190 CLR 1 at 152 per Gummow J; [1997] HCA 27; APLA Ltd v Legal Services Commissioner (NSW) (2005) 224 CLR 322 at 453-454 [389] per Hayne J; [2005] HCA 44; Bennett v The Commonwealth (2007) 81 ALJR 971 at 998 [135] of my own reasons; 235 ALR 1 at 34-35; [2007] HCA 18; Roach v Electoral Commissioner (2007) 81 ALJR 1830 at 1834 [7] per Gleeson CJ, 1841 [44] per Gummow, Kirby and Crennan JJ; (2007) 239 ALR 1 at 4-5, 14-15; [2007] HCA 43. 97 cf Durham Holdings Pty Ltd v New South Wales (2001) 205 CLR 399 at 410 [14]; [2001] HCA 7. 98 See eg Australian Communist Party v The Commonwealth ("the Communist Party Case") (1951) 83 CLR 1 at 193; [1951] HCA 5. 99 See eg Boilermakers (1956) 94 CLR 254 at 270. 100 Boilermakers (1956) 94 CLR 254 at 305-306 per Williams J, 329 per Webb J, 342- 343 per Taylor J. See Austin v The Commonwealth (2003) 215 CLR 185 at 249 [124] per Gaudron, Gummow and Hayne JJ; cf at 313 [316]-[317] of my own reasons; [2003] HCA 3; Roach (2007) 81 ALJR 1830 at 1839 [24] per Gleeson CJ, 1851 [95] per Gummow, Kirby and Crennan JJ; cf at 1853-1854 [110]-[113] per Hayne J; 239 ALR 1 at 11, 27-28; cf at 31. Kirby determining matters that fall within s 75(v) of the Constitution, but which otherwise have no national, federal or legal import. Particularly was this so where, virtually without precedent, the Federal Parliament had departed from a long line of statutory provisions designed to afford general discretionary powers to this Court to remit such matters. By the 2005 Act, the Parliament had chosen to enact measures clearly intended effectively to force people like the plaintiff into proceedings in the original jurisdiction of this Court. In such matters, other federal (including Territory) courts or State courts could much more easily perform the functions envisaged by s 75(v) of the Constitution. They had long done so. They could not therefore be lawfully deprived of that function where the imputed or apparent purpose of the statutory provision was to overburden this Court and to discourage or frustrate such proceedings, effectively preventing their proper determination. If the necessity of protecting the essential constitutional and appellate functions of this Court was the touchstone for the derivation of an implied constitutional power of remittal, the plaintiff argued that it had been satisfied in his case. Whatever might have been the position at Federation, with a smaller population and economy, comparatively confined statute books and decisional authority and fewer cases to be heard, changes since then demonstrated the necessity of remedies for protecting the Court from the deliberate diversion of matters into its original jurisdiction that would not otherwise justify the exercise of such jurisdiction. In short, the plaintiff submitted that this Court was not required simply to accept such a burden on its original jurisdiction without response. It was entitled, and obliged, to defend itself in order to continue to hear and determine those matters that had properly to be decided by the High Court in its original and appellate jurisdiction. To deny a power of ultimate control over the discharge of the Court's functions as envisaged by the Constitution would effectively surrender to the Parliament functions that constitutionally belonged to the Court itself. Clarification of entrenched role: In his submissions, the plaintiff pointed to the unusual features introduced by the 2005 Act that diminish the statutory powers of remittal101. He also emphasised that the 2005 Act was enacted without knowledge of the later decision of this Court in Bodruddaza102 that made clear 101 The general statutory trend has been to relieve this Court of jurisdiction rather than to burden it with effectively compulsory jurisdiction. 102 (2007) 228 CLR 651. The decision was dated 18 April 2007. Kirby what had perhaps earlier been left to inference103. Bodruddaza clarified the fact that s 75(v) of the Constitution could not be subjected to an inflexible time limit, as attempted in s 486A(1) of the Act, introduced by the 2005 Act. Thus the dynamics of the statutory scheme then provided were markedly changed104. As Gleeson CJ, Gummow and Hayne JJ point out, the legislative scheme of the 2005 Act failed to achieve the objective mentioned by the Attorney- General to support the further provisions now contested by the plaintiff105. It therefore remains for this Court to consider the further protective measure. This Court having invalidated the attempt to impose a rigid time limit upon its exercise of original jurisdiction, the plaintiff submitted that it was only a small step to invalidate the inter-connected attempts by the Parliament to prevent this Court from remitting its s 75(v) jurisdiction to the FCA or the FMC. It was a further small step to invalidate the laws that set out to deprive those federal courts of the jurisdiction and power to receive the remitted matters. For the plaintiff, all such provisions were infected with the vice revealed by Bodruddaza and should provoke a similarly firm judicial response. Conformability with other implied powers: To rebut any suggestion that finding such an implied constitutional power to remit would involve taking a radical or unusual step, the plaintiff cited a broad range of other powers, not expressly stated in Ch III of the Constitution, or in legislation, which this Court has previously acknowledged, or assumed, to exist. Such powers are collected in the reasons of Heydon, Crennan and Kiefel JJ106. I will not repeat them. It is fair to remark that, because a body is created by or under the Constitution as a "court", it will necessarily enjoy a range of powers so as to be able to discharge its functions accordingly. A court established under Ch III of the Constitution, as part of the integrated Judicature of the Commonwealth, will necessarily partake of certain features, enjoy certain powers and be subject to certain requirements implied from the essential character and functions of such courts107. The grant of any part of the judicial 103 Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476; [2003] HCA 2. 104 The terms of s 486A of the Act appear in Bodruddaza (2007) 228 CLR 651 at 661 105 Reasons of Gleeson CJ, Gummow and Hayne JJ at [2]-[3]. See Australia, House of Representatives, Parliamentary Debates (Hansard), 10 March 2005 at 3. 106 Reasons of Heydon, Crennan and Kiefel JJ at [196]. 107 See eg Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51 at 96 per Toohey J, 107 per Gaudron J, 115 per McHugh J, 141-142 per Gummow J; [1996] HCA 24. Kirby power of the Commonwealth necessarily carries with it the authority to do what is essential to effectuate the purposes of the court108. The plaintiff argued that the long list of implied powers accepted to date should make this Court less hesitant to add an implied constitutional power of remittal. If that power were necessary to protect the essential constitutional character and functions of this Court, it should be accepted and declared to exist along with the other implied powers previously discovered – and for similar reasons. Conformability with historical orders: The plaintiff also submitted that, in creating the courts and legal procedures as expressed in Ch III of the Constitution, the purpose of the document was to establish (or continue) courts and legal procedures of a type generally found in the United Kingdom, from where Australia derived its judicial and legal traditions before and at the time of Federation109. English legal history reveals the existence of a writ, called Procedendo, which bears some similarity to the implied constitutional power of remittal for which the plaintiff argued. That writ was available under the hand of the respective Chief Justices of the several Royal Courts (or the Chief Baron of the Court of Exchequer) to command inferior courts, notwithstanding the earlier issue of a writ of prohibition, habeas corpus or otherwise, to110: "proceed with what speed you can, in such manner, according to the law and custom of England, as you shall see proper; our said writ to you thereupon before directed in anywise notwithstanding". the contrary thereof The writ of Procedendo is not expressly included in s 75(v) of the Constitution, nor is it mentioned within the public law remedies in the Judiciary 108 United Mexican States v Cabal (2001) 209 CLR 165 at 180 [37]; [2001] HCA 60. 109 cf R v Davison (1954) 90 CLR 353 at 382 per Kitto J; [1954] HCA 46; White v Director of Military Prosecutions (2007) 81 ALJR 1259 at 1272 [46] per Gummow, Hayne and Crennan JJ; 235 ALR 455 at 468; [2007] HCA 29; Thomas v Mowbray (2007) 81 ALJR 1414 at 1435 [66], 1443-1444 [116]-[121] per Gummow and Crennan JJ; 237 ALR 194 at 218, 229-230; [2007] HCA 33. 110 The form of the writ of Procedendo is contained in Chitty, Forms of Practical Proceedings, in the Courts of Queen's Bench, Common Pleas, and Exchequer of Pleas, 5th ed (1840) at 564. Provision for the writ was included in the original Rules of Court contained in the Schedule to the High Court Procedure Act 1903 (Cth). See Order XLI, Pt 4 ("Prohibition"), r 29. Kirby Act 1903 (Cth) ("the Judiciary Act")111, in other legislation112, or in the present High Court Rules. In traditional courts of general jurisdiction, the survival of the writ continues to be a matter of debate113. There are important differences between the writ of Procedendo and the type of implied remittal for which the plaintiff argued. Specifically, Procedendo existed in a court to which proceedings had earlier been removed by another writ. It directed the court a quo to resume an interrupted hearing, notwithstanding the earlier order for removal. That is not the situation here. The suggested remittal is not to a court (the FMC) which, until interrupted by the superior court's writ, was hearing the plaintiff's proceedings. Instead, it is directed to that court where earlier proceedings had been started and discontinued by the plaintiff, acting in accordance with his then understanding of the validity and meaning of the legislation that is now challenged. Nonetheless, the plaintiff relied on the writ of Procedendo to demonstrate that a prerogative or common law order in the nature of remittal was not, as such, alien to superior courts of the Anglo-Australian legal tradition, including in cases where writs of the kind provided by s 75(v) of the Constitution had earlier been made. To this limited extent, the point made by the plaintiff is a valid one. It is reinforced by the existence and exercise of the statutory power of remittal afforded by the Judiciary Act throughout most of the history of this Court. Even at the time when questions as to the limit inter se of the constitutional powers of the Commonwealth and of the States were automatically removed into this Court by statute114, power was retained by this Court to terminate the removal where it appeared that the cause "does not really and substantially arise under the Constitution or involve its interpretation". This Court would then dismiss the matter or "remit it to the Court from which it was removed as justice requires"115. The statutory power of remittal belonging to this Court has therefore always been very broad. To that broad statutory power the 111 Section 33. 112 Such as the High Court of Australia Act 1979 (Cth). 113 eg R v T [1995] 2 Qd R 192 at 194 per McPherson JA; cf Great Western Railway Co v West Midland Traffic Area Licensing Authority [1936] AC 128 at 140 per Lord Atkin. 114 Judiciary Act, s 40A, inserted by Judiciary Act 1907 (Cth), s 5 (repealed by Judiciary Amendment Act 1976 (Cth), s 9). 115 Judiciary Act, s 42(1) (repealed and substituted by Judiciary Amendment Act 1976 (Cth), s 9); cf Lee Fay v Vincent (1908) 7 CLR 389; [1908] HCA 70. Kirby plaintiff argued that an implied constitutional power should be added, having at least some features in common with Procedendo. Conformability with appeals: The plaintiff also relied on the care that had been taken by the Parliament when regulating appeals to this Court by special leave. This involved avoiding any actuality or appearance of statutory interference with this Court's discharge of its appellate functions and confining the legislative prescription to the "regulation" and "prescription" provided for by s 73 of the Constitution. The plaintiff noted that this was the critical question before this Court in Carson v John Fairfax & Sons Ltd116. In upholding the validity of the new statutory provisions controlling the grant of special leave to appeal to this Court117, one of the salient points made by the Court was that the last word in the determination of the Court's appellate jurisdiction was still reserved to the Court itself. If otherwise within the constitutional provision governing appeals, matters would thus only be excluded if this Court so decided. As the Court stated118: "The Court is at liberty to hear and determine such appeals as it considers appropriate in accordance with the criteria or considerations relevant to the grant or refusal of special leave." By analogy, the plaintiff submitted that this Court had the final word as to whether it would hear or not hear matters, or would hear matters only after remittal to, and determination by, another court. Ultimately, this would only be possible if the power of remittal was perceived as inhering in the Court under the Constitution and was not necessarily reliant on federal legislative provisions. As demonstrated by the 2005 Act, such statutory provisions could occasionally reduce the ultimate power of the Court over the performance of its entire jurisdiction. Where this was the outcome, the plaintiff argued that this Court was empowered, out of necessity, to protect its own character and essential functions. Conformability with final courts: The plaintiff also invoked decisions of two other final national courts, the Supreme Courts of the United States of America and India. He suggested that a decision from each court bore some analogy to the present problem and supported his argument for the existence of the implied constitutional power. 116 (1991) 173 CLR 194; [1991] HCA 43. 117 Relevantly the Judiciary Act, s 35A. 118 (1991) 173 CLR 194 at 217 (emphasis in original). Kirby The United States decision was Carnegie-Mellon University v Cohill119. A federal District Court had held that there was an "inherent" (non-statutory) power in the federal judiciary to remit ("remand") cases that had earlier been removed from a State court to the federal District Court under its pendent jurisdiction. The power of remand was upheld for reasons of "economy, convenience, fairness, and comity"120. The relevant federal removal statute121 explicitly authorised remand in only two situations. The parties to that case agreed that neither situation was applicable. The question in Carnegie-Mellon was therefore whether, in the absence of an express statutory provision to cover the type of case before the courts, the silence of the statute negated the existence of a curial power to remand. The majority held that it did not. They concluded that to remand the case would generally be preferable to dismissal, upon which order a statute of limitations would descend122. The majority thus held that remand was within the exercise by federal courts of their pendent jurisdiction. Whilst the source was not expressly spelt out, by inference, the power derived from the constitutional character of such courts. The opinion of the Supreme Court was delivered by Marshall J123. A strong dissent was written by White J (with whom Rehnquist CJ and Scalia J agreed)124. The minority judges contested the power of the Court itself to grant federal District Courts "virtual carte blanche to remand pendent claims" and particularly "for the amorphous reasons" expressed125. They held that this action could not be reconciled with the earlier holding of the Supreme Court in Thermtron Products Inc v Hermansdorfer126 "that cases cannot be remanded for 120 484 US 343 at 351 (1988). 121 28 USC §1441(a). 122 484 US 343 at 351-352 (1988). 123 484 US 343 at 345 (1988). 124 484 US 343 at 358 (1988). 125 484 US 343 at 361 (1988). 127 484 US 343 at 361 (1988). Kirby Despite this earlier authority and the strong dissent in Carnegie-Mellon, the current doctrine of the United States Constitution is that a remand (remittal) power belongs to federal courts beyond the powers provided to such courts by Congress. Because the power was reposed in a federal court, there was thought to be no relevant risk of its misuse for improper reasons or "manipulative tactics"128. The Ch III provisions in the Australian Constitution are different from those of Art III in the United States Constitution. However, Carnegie-Mellon is arguably an important acknowledgment of the potential for the Constitution itself to sustain, in certain circumstances, an implied or "inherent" power to remand matters to other courts for reasons of broad requirements of justice and out of powers inhering in a court of the given character and functions. The decision of the Supreme Court of India in P N Kumar v Municipal Corporation of Delhi129 is different from the present case. That case did not involve remittal, as such, but rather a direction by the Supreme Court to the petitioners to approach the relevant State High Court for relief under Art 226 of the Indian Constitution. The petitioners had filed a writ petition before the Supreme Court of India under Art 32 of the Constitution. That article affords constitutional remedies for the enforcement of fundamental rights as provided in Pt III of the Indian Constitution. Notwithstanding Art 32, by Art 226, every High Court has power, within its jurisdiction, to issue writs of the same kind (including writs in the nature of mandamus, prohibition and certiorari). The deflection of the petition to the relevant High Court in Kumar appears to have occurred by way of adjournment or postponement of the proceedings in the Supreme Court. Nevertheless, some remarks of the participating judges (E S Venkataramiah and K N Singh JJ) describe circumstances that, if replicated in Australia, would arguably present the necessity for an implied constitutional power of remittal to prevent the final court from being so overburdened in its original jurisdiction as to be incapable of fulfilling its character and discharging its functions130: "This Court has no time today even to dispose of cases which have to be decided by it alone and by no other authority. Large number of cases are pending from 10 to 15 years. Even if no new case is filed in this 128 484 US 343 at 357 (1988). 129 [1988] 1 SCR 732. 130 [1988] 1 SCR 732 at 735. Kirby Court hereafter, with the present strength of Judges it may take more than 15 years to dispose of all the pending cases. If the cases which can be filed in the High Courts are filed in the High Court and not in this Court this Court's task of acting as [an] original court which is a time consuming process can be avoided and this Court will also have the benefit of the decision of the High Court when it deals with an appeal filed against such decision. … We should preserve the dignity, majesty and efficiency of the High Courts. … [T]he time saved by this Court by not entertaining the cases which may be filed before the High Courts can be utilised to dispose of old matters in which parties are crying for relief." A discretionary refusal to enter upon undoubted jurisdiction is to be distinguished from an order of remittal or its functional equivalent. Nonetheless, the predicament of the Supreme Court of India, described in Kumar, indicates that, where necessary, such courts may feel obliged to find remedies for the gross over-crowding of their lists. This is especially so in final national courts, like this Court, where the discharge of their essential constitutional functions can be endangered by such over-crowding. For example, if the Federal Parliament were to repeal the universal special leave arrangements governing the appellate jurisdiction of this Court131, it would be likely that the supervening increase in appeals would oblige this Court to adopt non-statutory means to protect the discharge of its core constitutional functions. Likewise, within the original jurisdiction. If the Parliament were to prevent all possibility of judicial review in mass jurisdiction subjects (such as migration decisions), leaving only the remedies entrenched in this Court under s 75(v) of the Constitution, it is likely that other non-statutory procedures would have to be adopted by the Court to protect the fulfilment of its constitutional character and functions. In effect, this was what the plaintiff argued. He submitted that the enactment by the Parliament of a statute that diverted his proceedings, and others like them, to this Court alone enlivened the necessity of a constitutional remedy by way of remittal. Once that power was derived from the Constitution itself, the question of whether circumstances had been demonstrated for the exercise of the power in the present case could be separately argued and decided. 131 See Judiciary Act, s 35A. Kirby Immaterial considerations: Against the foregoing presentation of his arguments, the plaintiff labelled a number of the contentions raised against him as immaterial to the implied power of remittal for which he contended. Thus, the fact that no precedent existed which assisted him on the exact point132 could be explained because, never before 2005, had the Parliament of the Commonwealth endeavoured in such a way to narrow this Court's statutory remittal power. Never, having granted a general jurisdiction to subordinate federal courts to provide judicial review, had that jurisdiction been cut back effectively to oblige such applications to be brought in this Court. Likewise, the plaintiff submitted that the absence of a present "flood" of cases was not determinative of the existence, or otherwise, of an implied power of remittal133. This was to be found, or not found, in the language, structure, history and purpose of the Constitution. A decision on the existence of the power was to be distinguished from a decision on the occasion of its suggested exercise. Conclusion: an arguable concept: I have taken care to explain the plaintiff's arguments in order to demonstrate that his submission is far from unpersuasive. In circumstances that can be postulated, an implied constitutional power of remittal might be upheld, beyond the statutory power afforded by s 44 of the Judiciary Act. In his reasons for the Court in Lambert v Weichelt134, Dixon CJ135 appears to have contemplated the existence of wider powers of remittal beyond the Judiciary Act. He said, referring to a proceeding removed into this Court by order made under s 40 of the Judiciary Act136: "We must decide the whole cause in fact and in law, unless under the power conferred by s 42 of the Judiciary Act or otherwise we remit it for reconsideration to the court from which it has been removed." This reference to "or otherwise" scarcely amounts to a decision on the point argued in these proceedings. However, for a judge who was always careful in his use of language in such matters, it indicates that the possibility now argued for the plaintiff may not have been entirely alien to Dixon CJ's thinking. 132 Reasons of Gleeson CJ, Gummow and Hayne JJ at [51]. 133 Reasons of Gleeson CJ, Gummow and Hayne JJ at [53]. 134 (1954) 28 ALJ 282. 135 For himself, McTiernan, Webb, Fullagar, Kitto and Taylor JJ. 136 (1954) 28 ALJ 282 at 283 (emphasis added). Kirby Subject to what follows, therefore, I would not be prepared to hold that the language, structure, history and purpose of the Constitution exclude the possibility of an implied power in this Court to remit a proceeding properly commenced before it to another court which, for some reason, does not fall within the ambit of a statutory power of remittal enacted by the Parliament. In a case of necessity, this Court would not be without an implied constitutional power to protect its essential character and functions. As I said in Nicholas v The Queen137: "Upholding the integrity of the judicial system is the unavoidable obligation of courts. It cannot be surrendered to the other branches of government. They cannot be permitted to direct the courts to act in ways which would undermine the integrity of the judicial process and thereby run the risk of imperilling public confidence in the courts." These conclusions notwithstanding, I am unconvinced that a constitutional power of remittal must be found to meet the circumstances revealed in these proceedings or otherwise known to the Court. The necessity for non-statutory remittal is unproved General scheme: statutory definition: Whatever may be the design of other national constitutions, the Australian Constitution was drafted to give effect to the notions of parliamentary "sovereignty" that prevailed at the time of its adoption. Thus, the "original jurisdiction" of this Court was to arise in a constitutional list of specified subject matters138 or under federal laws conferring jurisdiction on other subjects139. The power to define jurisdiction by federal law is spelt out with particularity140. The importance of the power to "define" the jurisdiction of federal courts by parliamentary law was explained by this Court in Abebe141. Section 77(i) of the Constitution, empowering the Parliament to make laws "defining the jurisdiction of any federal court", does not extend to the jurisdiction of this Court as there expressed. Thus, relevantly, to matters "in which a writ of Mandamus or 137 (1998) 193 CLR 173 at 265 [213]; [1998] HCA 9 (footnote omitted). 138 Constitution, s 75. 139 Constitution, s 76. 140 Constitution, s 77. 141 (1999) 197 CLR 510. Kirby prohibition or an injunction is sought against an officer of the Commonwealth"142 in this Court, no law, made by the Parliament, can deprive this Court of such original jurisdiction under the guise of "defining" the jurisdiction. Neither the Act nor the 2005 Act purports to do this. Unless the grant of "original jurisdiction" in s 75(v) of the Constitution without more necessarily imports a power in this Court to remit the exercise of that jurisdiction to some other court, provisions in the Act that attempt to "define" the jurisdiction and power of the FCA and the FMC, similar to that stated in s 75(v) of the Constitution, do not appear to cut across any entrenched original jurisdiction of this Court. To the contrary, by "defining the jurisdiction" of those other courts, the Parliament would appear to have done no more than s 77(i) contemplates. What I said in Abebe143 applies: "[W]ithin the jurisdiction so granted to the [federal courts], the Parliament has made no attempt whatever to dictate … 'the manner and outcome' of the exercise of that court's jurisdiction. It remains wholly independent. It performs functions proper to a federal court. The objection that the Parliament ought not to have granted and withheld jurisdiction in the precise manner that it has is an objection of a political or practical character. The practical implications for the work of this Court are potentially significant. But such political and practical arguments must be addressed to the Parliament not the Court. So long as the law which it enacts offends no requirement or limitation of the Constitution and 'defines' the jurisdiction of a federal court 'with respect' to a 'matter' within the Parliament's authority, such a law is constitutionally valid." Distinguishing overseas cases: Because of the differences between the Constitution of Australia and those of other countries, it is impossible to treat judicial observations elsewhere as entirely analogous to the Australian case. Thus, the distinction between the disposition of Kumar in the Supreme Court of India144 and the implied constitutional remittal sought in these proceedings is obvious. There was no remittal in Kumar, still less one sourced in the implied constitutional powers of the Supreme Court. Likewise, in the United States case of Carnegie-Mellon145, the majority were at pains to emphasise that the power of non-statutory "remand", which they 142 Constitution, s 75(v). 143 (1999) 197 CLR 510 at 593 [237] (footnote omitted). 144 [1988] 1 SCR 732. Kirby upheld, was justified by the silence of the statute by which Congress had otherwise expressly authorised certain "remands". Thus, Marshall J, for the Court, said146: "We do not dispute that Congress could set a limitation … on the federal courts' administration of the doctrine of pendent jurisdiction. But Congress has not done so, expressly or otherwise, in the removal statute. … Given that Congress' silence in the removal statute does not negate the power to dismiss such cases, that silence cannot sensibly be read to negate the power to remand them." By inference, if in the circumstances of Carnegie-Mellon the relevant federal law had expressly provided for remand on specified conditions or had forbidden such remand, the reasoning suggests that the Supreme Court would have given effect to the statute according to its terms. So why not do so here, where the Parliament has enacted a law expressly forbidding remand by the High Court to the FCA and the FMC? The answer provided by the plaintiff was that such a law purported to "define" the High Court's "original jurisdiction" in a matter that fell within the constitutional list (s 75) and thus fell outside the parliamentary power to make laws "defining the jurisdiction". Yet, such a conclusion would stretch the ambit of the constitutional grant of jurisdiction in s 75(v) to cover not only the exercise of that jurisdiction in this Court, but also its exercise in some other court to which the High Court, of implied suggested necessity, had remitted constitutional power of remittal. Only in this way could the implied power of remittal invalidate the enacted exclusion of remittal. The case for adopting such a construction of s 75(v) has not been made out. the matter pursuant the Legislative protection of jurisdiction: The scheme of the Constitution obviously envisages initiatives by the Parliament to protect and uphold the capacity of this Court to fulfil its essential constitutional character and functions. It does so both in the appellate and original jurisdiction of the Court. Over the years, laws have been enacted to provide "exceptions" and "regulations" in the determination of appeals147, to "confer" original jurisdiction on this Court and to "define" the jurisdiction of other federal courts. This has been done to protect this Court from burdens that would frustrate the fulfilment of its essential constitutional character and functions148. 146 484 US 343 at 354 (1988). 147 See Constitution, s 73. See eg Judiciary Act, s 35A, added by Judiciary Amendment Act (No 2) 1984 (Cth), s 4. 148 See Constitution, ss 76 and 77. Kirby This appears to be the way the Constitution was intended to operate, in an ongoing conversation between the Court and the Parliament, each respectful of the other's envisaged role. This Court has said many times that, in resolving particular constitutional questions, it does not need to postulate a chamber of legislative horrors, unlikely to be enacted by the elected Parliament of the Commonwealth149. On the other hand, a conviction that a constitutional offence will be rare is not a reason for ignoring it when it is shown to exist. That would be to betray the central function of this Court as the guardian of the Constitution and upholder of its requirements. We should not adopt a laissez-faire attitude to the validity of impugned legislation. Sometimes exceptional and apparently offensive legislation can signal a constitutional defect which it is the function of this Court to expose150. The plaintiff emphasised the uniquely restrictive character of the law which, he complained, was part of a scheme that was partially invalidated in Bodruddaza151. However, substantially coinciding with the 2005 Act, this Court took its own initiatives, pursuant to statutory power, to make new Rules of Court to cope with defined proceedings in the Court without oral hearings152. The consequent amendments to the Rules were not disallowed in the Parliament. 149 Western Australia v The Commonwealth ("the Territorial Senators' Case") (1975) 134 CLR 201 at 275 per Jacobs J; [1975] HCA 46; Kartinyeri v The Commonwealth (1998) 195 CLR 337 at 380-381 [87]-[88] per Gummow and Hayne JJ; [1998] HCA 22; Egan v Willis (1998) 195 CLR 424 at 505 [160] of my own reasons; [1998] HCA 71; Shaw v Minister for Immigration and Multicultural Affairs (2003) 218 CLR 28 at 43 [32] per Gleeson CJ, Gummow and Hayne JJ; [2003] HCA 72; XYZ v The Commonwealth (2006) 227 CLR 532 at 549 [39] per Gummow, Hayne and Crennan JJ; [2006] HCA 25; Forge v Australian Securities and Investments Commission (2006) 228 CLR 45 at 69 [46] per Gleeson CJ; [2006] HCA 44; New South Wales v The Commonwealth (Work Choices Case) (2006) 229 CLR 1 at 117-118 [187]-[188] per Gleeson CJ, Gummow, Hayne, Heydon and Crennan JJ; [2006] HCA 52. 150 As happened, for example, in the Communist Party Case (1951) 83 CLR 1 and in Kable (1996) 189 CLR 51; cf Singh v The Commonwealth (2004) 222 CLR 322 at 418 [268] of my own reasons; [2004] HCA 43. 151 (2007) 228 CLR 651. 152 High Court Rules 2004, r 41.10.5 and r 41.11.1. The power to make Rules of Court is provided by the Judiciary Act, s 86. See also High Court of Australia Act 1979 (Cth), s 48. The Legislative Instruments Act 2003 (Cth) applies in relation to such Rules of Court which are subject to disallowance in the Parliament. Kirby Therefore, the record does not sustain an inference (if such were suggested) that, by confining to this Court's original jurisdiction proceedings such as those of the plaintiff, the Parliament has deliberately or otherwise "swamped" this Court with unsuitable matters or set out to impair its capacity to discharge its jurisdiction in conjunction with the necessary performance of the appellate jurisdiction of the Court. Rationale for the proceedings: During argument, I asked counsel for the plaintiff to resolve a puzzle153. Why, having commenced proceedings in this Court (where the statutory time limit would not debar him from relief), was the plaintiff anxious to have his matter remitted to the FMC? Why would he not expend the same resources and energy to pursue the available constitutional remedies in this Court under s 75(v)? The answer provided was that, by decision of legal aid authorities in the State of Victoria, support for proceedings in the original jurisdiction of this Court would not be available to the plaintiff in a case such as the present. It was, however, available to contest the constitutional validity of the law under challenge. Obviously, the necessity of an implied constitutional power of remittal cannot be determined, or even influenced, by such extraneous considerations. Nevertheless, for practical reasons, I am prepared to accept that the plaintiff and those advising him may have judged that, on the available statistics, his chances of securing a favourable disposition in this Court were small. As a matter of practicalities, his legal prospects, and those of people like him, would be improved if their applications for judicial review were heard in the first instance by the FMC. Certainly that Court would ordinarily have more time available to it for such a case than this Court would. Nevertheless, an invocation of the original jurisdiction, which is what the plaintiff attempts, initiates a trial ultimately dependent on evidence. The plaintiff wishes to have that trial. The stated case is a means of deciding whether such a trial is viable or, constitutionally speaking, would be futile. Nothing in the record, which this Court may consider in understanding the stated case, supports a conclusion that the burden imposed on this Court by the impugned provisions of the Act, as introduced by the 2005 Act, would impair the capacity of this Court to perform its essential constitutional functions. Moreover, those matters of which the Court may take judicial notice contradict any such conclusion. The experience of the Court, under the new Rules, evidences its capacity to cope with the present jurisdiction. The 153 [2008] HCATrans 097 at 1530. Kirby dispositions remain entirely subject to the power and decision of the Justices. The burdens on this Court, although large, are much less than those on the Supreme Court of India, as described in Kumar154. It follows that no foundation is afforded that could sustain a conclusion that an implied constitutional power of remittal from this Court to another court of the plaintiff's matter is necessary, in the sense of constitutionally essential, to protect the capacity of the Court to fulfil its constitutional character and to discharge its core constitutional functions. Conclusion: remittal not established: Accordingly, upon his arguments on the stated case, the plaintiff has failed to make good his claim of a non- statutory power of remittal in this Court. Subject to what follows, I would not be prepared to exclude the possibility that such an implied constitutional power of remittal might exist, to be called forth in conceivable circumstances. The evidence presented in the case stated and knowledge available by judicial notice contradict the present existence of such extreme circumstances. It is enough, therefore, to say that the plaintiff has not made good his assertion of an implied constitutional power of remittal. The questions in the case stated should be answered accordingly, but upon that footing. The existence of a receiving court The remaining issues: The foregoing conclusion leaves undecided the remaining issues concerning the existence of a court with the jurisdiction and power to receive any remittal from this Court, pursuant to the propounded implied constitutional power of remittal155. As previously stated, those issues have been separated for convenience. Logically, however, they cannot be divorced from the resolution of the question of whether an implied power of remittal is consistent with the language, structure, history and purpose of the Constitution. In the present case, it is comparatively straight-forward to deal separately with the "receiving court" issues. If I had concluded that an implied power of remittal otherwise existed, it would have been relatively simple (as a matter of statutory excision) to identify the federal statutory provisions necessary to eliminate any impediment to the reception by the FMC of such a remittal from this Court. Section 476(1) of the Act provides: 154 [1988] 1 SCR 732 at 735. See above, these reasons at [110]. 155 See above, these reasons at [71]-[72]. Kirby "Subject to this section, the Federal Magistrates Court has the same original jurisdiction in relation to migration decisions as the High Court has under paragraph 75(v) of the Constitution." If the introductory words "[s]ubject to this section" were found invalid as an impermissible burden on an implied constitutional power of remittal belonging to this Court (and, possibly, if s 476(2) and (4) were invalidated for the same reason), the FMC would undoubtedly then enjoy jurisdiction and power under the Act to receive any such remittal from this Court. Thus, to remit to a recipient federal court, with its jurisdiction "defined" by a law made by the Parliament, as s 77(i) of the Constitution contemplates, only comparatively minor surgery on the Act would be needed. This might have to be supplemented by a declaration that the provisions of s 476B of the Act, as would impede the exercise of the implied remittal power, were invalid under the Constitution. In the present case, with such limited surgery, a receiving court would validly exist. There would then be no need to explore the remaining issues of whether, under the Constitution, State Supreme Courts might (without federal legislation) receive any such remittal, supported only by the Constitution itself or by the orders of this Court carrying with them the requisite federal jurisdiction to make good the remittal156. Conclusion: unnecessary to answer: As the plaintiff did not succeed in his argument that an implied constitutional power of remittal exists in this Court, it is neither necessary, nor appropriate, to pursue further the possible existence of a receiving court with the jurisdiction and power to decide the plaintiff's matter. It is sufficient to conclude that, had an implied constitutional remittal power been otherwise established, such power to receive the remittal would not have to be rejected in this case because of a lack of a court that could receive and determine the remitted matter. Like the ultimate question of the existence of an implied power of remittal, the resolution of that question can be postponed. Such issues may never arise to be answered. The experience of the Constitution to this time suggests that this will be the situation. Nothing in the plaintiff's stated case, or in otherwise available knowledge, establishes the contrary. 156 cf Johnstone v The Commonwealth (1979) 143 CLR 398 at 402 per Gibbs J, 407 per Murphy J; [1979] HCA 13. Kirby Orders It follows that, on the basis ultimately expressed by Gleeson CJ, Gummow and Hayne JJ157, the questions in the case stated should be answered as proposed in their reasons158. 157 Reasons of Gleeson CJ, Gummow and Hayne JJ at [52]-[54]. 158 Reasons of Gleeson CJ, Gummow and Hayne JJ at [55]. 145 HEYDON, CRENNAN AND KIEFEL JJ. The central issue, which comes before the Full Court on a case stated, is whether ss 476(2)(a) and (d) of the Migration Act 1958 (Cth) ("the Act") are invalid because it is said they prohibit this Court from exercising an implied power to remit to another court, matters commenced in its original jurisdiction under s 75(v) of the Constitution. The power to remit was sought to be implied from the nature and role of this Court as determined by Ch III of the Constitution159, the nature of the judicial power of the Commonwealth and the fact that the Constitution does not expressly confer any exclusive original jurisdiction on this Court. The facts The plaintiff is a national of Nigeria. On 13 February 2006, the plaintiff lawfully entered Australia using a Business (Short Stay) visa. On 15 March 2006 he applied for a Protection (Class XA) visa on the basis of a well-founded fear of persecution on the ground of his religion. On 18 April 2006 a delegate of the defendant decided to refuse the application for a protection visa. A copy of the decision was sent to the plaintiff's last notified address. The plaintiff was informed of the decision when he attended the offices of the Department in January 2007, after being contacted by phone and informed that he was an unlawful non-citizen. At this time he did not request, and was not given, a copy of the decision. The proceedings On 6 February 2007, whilst unrepresented, the plaintiff applied for judicial review of the delegate's decision in the Federal Magistrates Court. On 16 March 2007 the defendant's solicitors served on the plaintiff a copy of a court book, which included a copy of the delegate's decision. The plaintiff had not previously received a copy of that decision. The defendant objected to the competency of the Federal Magistrates Court on the basis that notification of a decision of the delegate did not constitute a "migration decision" as defined by ss 5 and 474 of the Act, and review was being sought of a "primary decision" in respect of which the Federal Magistrates Court had no jurisdiction, given the terms of s 476(2)(a) of the Act (which is set out below). The matter was discontinued by consent on 3 May 2007 because of this objection to competency. 159 Read with covering cl 5 of the Constitution. On 29 March 2007, assisted by Victoria Legal Aid, the plaintiff applied to the Refugee Review Tribunal for review of the delegate's decision. On 25 May 2007 the Tribunal found that it had no jurisdiction to review the decision because the application was lodged outside the mandatory time limit prescribed in the Act. On 11 April 2007 the plaintiff filed an application in this Court for an order to show cause and subsequently filed an amended application for an order to show cause. On 8 November 2007 Hayne J stated a case for the consideration of the Full Court pursuant to s 18 of the Judiciary Act 1903 (Cth) ("the Judiciary Act"). The questions in the stated case are: "Q1. Is the effect of sections 476, 476A, 476B and 484 of the Act, read with the definition of 'migration decision' in sections 5, 5E and 474, that the only Court that can hear and determine an application for any or all of: the constitutional writs of prohibition and mandamus; the constitutional remedy of injunction against an officer of the Commonwealth; the public law remedy of certiorari; the public law remedy of declaration in a suit against the Commonwealth or a person being sued on behalf of the Commonwealth, in respect of a 'primary decision' (as defined in s 476(4)), is the High Court of Australia? If the answer to Question 1 is 'Yes', are any or all of sections 476, 476A, 476B and 484 of the Act invalid: because they curtail, limit or impair, either directly or as a matter of practical effect, the constitutional role of this Court? because they curtail, limit or impair, either directly or as a matter of practical effect, the right or ability of applicants to seek the relief identified in paragraphs (a)-(d) of Question 1? If the answer to Question 1 is 'Yes', are any or all of sections 476, 476A, 476B and 484 of the Act, and/or sections 38(e) and 39(1) of the Judiciary Act 1903 (Cth) invalid in so far as they apply to 'migration decisions' (as defined): because they are contrary to an implied power of this Court to remit to another court an application commenced in this Court for the relief identified in paragraphs (a)-(d) of Question 1? because they impair or frustrate the exercise of an implied power of this Court to decline to hear an application commenced in this Court for the relief identified in paragraphs (a)-(d) of Question 1, on the basis that another court is a more appropriate court? If the answer to Question 1 is 'No', or the answer to Question 2 or to Question 3 is 'Yes', should this matter be remitted to another court and, if so, to which court? Q5. Who should bear the costs of the case stated in this Court?" It can be noted that Question 3A is directed to the impugned provisions of the Act because it is said they impose a "prohibition" on the remitter power of this Court in respect of matters within its original jurisdiction under s 75(v) of the Constitution. Question 3B is directed to those provisions insofar as they prevent the exercise of any jurisdiction by a receiving court, that is a court with concurrent jurisdiction. In oral argument the plaintiff accepted that it is unnecessary for the Court to answer Question 2 and narrowed the ambit of Question 3 so that the argument on invalidity was restricted to ss 476(2)(a) and (d) of the Act. The Attorney-General of the Commonwealth has intervened pursuant to s 78A of the Judiciary Act and has made joint submissions on behalf of the defendant and the Attorney-General. The scheme of the Act Section 5(1) of the Act relevantly provides: "migration decision means: a privative clause decision; or a purported privative clause decision; or It can be noted that the terms "privative clause decision" and "purported privative clause decision" are defined by the Act160. The jurisdiction of the Federal Magistrates Court is defined by s 476 of the Act which relevantly provides: "Jurisdiction of the Federal Magistrates Court Subject to this section, the Federal Magistrates Court has the same original jurisdiction in relation to migration decisions as the High Court has under paragraph 75(v) of the Constitution. The Federal Magistrates Court has no jurisdiction in relation to the following decisions: a primary decision; 160 Section 474(2) provides: "privative clause decision means a decision of an administrative character made, proposed to be made, or required to be made, as the case may be, under this Act or under a regulation or other instrument made under this Act (whether in the exercise of a discretion or not), other than a decision referred to in subsection (4) or (5)." Section 5E defines "purported privative clause decision" as follows: In this Act, purported privative clause decision means a decision purportedly made, proposed to be made, or required to be made, under this Act or under a regulation or other instrument made under this Act (whether in purported exercise of a discretion or not), that would be a privative clause decision if there were not: (a) a failure to exercise jurisdiction; or (b) an excess of jurisdiction; in the making of the decision. In this section, decision includes anything listed in subsection 474(3)." a privative clause decision or purported privative clause decision mentioned in subsection 474(7). In this section: primary decision means a privative clause decision or purported privative clause decision: that is reviewable under Part 5 or 7 or section 500 (whether or not it has been reviewed); or that would have been so reviewable if an application for such review had been made within a specified period." Section 476A defines the jurisdiction of the Federal Court: "Limited jurisdiction of the Federal Court (1) Despite any other law, including section 39B of the Judiciary Act 1903 …, the Federal Court has original jurisdiction in relation to a migration decision if, and only if: the Federal Magistrates Court transfers a proceeding pending in that court in relation to the decision to the Federal Court under section 39 of the Federal Magistrates Act 1999; or the decision is a privative clause decision, or a purported privative clause decision, of the Administrative Appeals Tribunal on review under section 500; or the decision is a privative clause decision, or purported privative clause decision, made personally by the Minister under section 501, 501A, 501B or 501C; or the Federal Court has jurisdiction in relation to the decision under subsection 44(3) or 45(2) of the Administrative Appeals Tribunal Act 1975. (2) Where the Federal Court has jurisdiction in relation to a migration decision under paragraph (1)(a), (b) or (c), that jurisdiction is the same as the jurisdiction of the High Court under paragraph 75(v) of the Constitution." Section 476B of the Act specifies the circumstances in which the High Court may or may not remit a matter: "Remittal by the High Court Subject to subsection (3), the High Court must not remit a matter, or any part of a matter, that relates to a migration decision to any court other than the Federal Magistrates Court. The High Court must not remit a matter, or any part of a matter, that relates to a migration decision to the Federal Magistrates Court unless that court has jurisdiction in relation to the matter, or that part of the matter, under section 476. The High Court may remit a matter, or part of a matter, that relates to a migration decision in relation to which the Federal Court has jurisdiction under paragraph 476A(1)(b) or (c) to that court. Subsection (1) has effect despite section 44 of the Judiciary Act Section 484 of the Act relevantly provides: "Exclusive jurisdiction of High Court, Federal Court and Federal Magistrates Court (1) Only the High Court, the Federal Court and the Federal Magistrates Court have jurisdiction in relation to migration decisions. To avoid doubt, subsection (1) is not intended to confer jurisdiction on the High Court, the Federal Court or the Federal Magistrates Court, but to exclude other courts from jurisdiction in relation to migration decisions. It is convenient at this juncture to mention a number of matters about this scheme. A decision to refuse to grant a visa is a "privative clause decision" (ss 474(2) and (3)(b)) unless it involves a jurisdictional error, in which case it is a "purported privative clause decision" (s 5E)161. 161 This section and ss 476, 476A, 476B and 484 were introduced by the Migration Litigation Reform Act 2005 (Cth) enacted after the decision in Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476; [2003] HCA 2. Part 7 of the Act permits full merits review of a decision of the Minister's delegate before the Refugee Review Tribunal if an application for review is made within the time limits specified in s 412(1)(b) of the Act. The limitations on courts which have jurisdiction in respect of judicial review fall to be assessed within that context. It is only if an applicant for a protection visa does not seek merits review of a delegate's decision or fails to seek such review within the permitted time under s 412(1)(b) (as occurred here) that the legislative limitations on courts which have jurisdiction in relation to "primary decisions" are relevant. Section 476A provides that the Federal Court has original jurisdiction in relation to a "migration decision", if and only if the decision falls within the four paragraphs, set out above, which do not include a "primary decision" as defined in s 476(4). Whilst s 476(1) provides generally that the Federal Magistrates Court has the same original jurisdiction in migration decisions as this Court has under s 75(v) of the Constitution, s 476(2)(a) expressly excludes from that conferral of general jurisdiction, jurisdiction in relation to a "primary decision" and s 476(2)(d) decisions mentioned in s 474(7)162. The plaintiff characterised ss 476(2)(a) and (d) as withdrawing jurisdiction from a receiving court (said to be the Federal Magistrates Court), and the plaintiff characterised s 476B as "prohibiting" this Court from remitting a matter to the receiving court. There is agreement that of the three courts set out in s 484(1) only this Court has jurisdiction conferred on it by the Act in respect of a "primary decision". Accordingly, the plaintiff, the defendant and the intervener are all agreed that Question 1 of the stated case should be answered "Yes". This answer is plainly correct. The plaintiff's case As mentioned at the outset, the plaintiff challenged the validity of ss 476(2)(a) and (d) of the Act primarily by reference to Ch III of the Constitution. The essential argument put forward, on the plaintiff's behalf, was that this Court has an implied power to remit any matter commenced in its original jurisdiction to another receiving court. The contention which followed from that 162 An example of a decision under s 474(7) would be a personal decision of a Minister to grant or withhold a visa under s 417 of the Act. implication was that a law of the Commonwealth Parliament which denied jurisdiction to any receiving court to hear and determine remitted matters, or which prohibited the exercise of an implied power to remit, was a law which directed the manner and outcome of this Court's jurisdiction and was therefore an impermissible interference with this Court's exercise of the judicial power of the Commonwealth. In essence, the response of the defendant and the intervener was that the Commonwealth Parliament is not required by the Constitution to ensure that another court has concurrent jurisdiction in relation to every matter in which this Court has original jurisdiction. Accordingly, it was contended that a power to remit to another court, a matter commenced in the original jurisdiction of this Court, cannot be implied. The plaintiff's central proposition that ss 476(2)(a) and (d) are invalid because, absent a statutory or implied power to remit, the Commonwealth Parliament cannot pass laws which make the original jurisdiction of this Court under s 75(v) of the Constitution exclusive to this Court, must be rejected for the reasons which follow. Chapter III of the Constitution The plaintiff's reliance on Ch III, for the implication of a power to remit, first involved recognising this Court as a statutory court having a particular nature and role under the Constitution. Secondly, it involved characterising the judicial power of the Commonwealth as having certain incidents including, it was said, a power of remitter. Thirdly, it involved construing s 71 and ss 77(i) and (iii), which deal with the vesting of the judicial power of the Commonwealth, in a manner said to support an implied power of remitter. The plaintiff never asserted that there was an express power to remit this matter to the Federal Magistrates Court but it was contended that the scheme of the Act defined the Federal Magistrates Court's jurisdiction in such a way as to prohibit remitter by this Court of two categories of migration decisions: a "primary decision" and certain privative clause decisions under s 474(7). It was this prohibition which was contested as unconstitutional, notwithstanding the plaintiff's acknowledgement unexceptional. that regulation of a power of remitter The plaintiff, the defendant and the intervener all accepted that the circumstances in which an implication could be drawn from the Constitution were identified in the unanimous decision of this Court in Lange v Australian Broadcasting Corporation ("Lange")163. Any implication can "validly extend only so far as is necessary to give effect to [the sections from which the implication is drawn]" and an implication drawn from specific sections of the Constitution can "give effect only to what is inherent in the text and structure of the Constitution"164. The nature and role of the High Court Stripped to its essentials, the plaintiff's argument, as based on the nature and role of this Court, raised a question about the separation of powers under the Constitution: was it a matter for Parliament or for this Court to determine whether to hear a matter commenced in its original jurisdiction under s 75(v)? Whilst it cannot be doubted that the "power of remitter is of considerable importance in facilitating the exercise by this Court of its primary and unique functions"165, the functions of this Court are not confined to determining matters in its original jurisdiction involving the interpretation of the Constitution (s 76(i) of the Constitution and s 30(a) of the Judiciary Act) and its function, subject to the grant of special leave to appeal, as Australia's final appellate court (s 73 of the Constitution). In exercising its discretion to grant or refuse special leave to appeal from a decision of an intermediate appellate court, this Court normally considers whether the question before it is of such public importance as to warrant a grant of special leave because of the importance of its "public role"166. As stated by Gaudron, Gummow and Hayne JJ in Lipohar v The Queen167: 163 (1997) 189 CLR 520; [1997] HCA 25. 164 Lange (1997) 189 CLR 520 at 567. 165 Re Minister for Immigration and Multicultural Affairs; Ex parte Abebe [No 2] (1998) 72 ALJR 630 at 633 [11] per Gummow J; 152 ALR 177 at 180; [1998] HCA 16; see also Re Minister for Immigration and Multicultural Affairs; Ex parte Durairajasingham (2000) 74 ALJR 405 at 407 [9] per McHugh J; 168 ALR 407 at 410; [2000] HCA 1. 166 Carson v John Fairfax & Sons Ltd (1991) 173 CLR 194 at 218 per Mason CJ, Brennan, Deane, Dawson, Toohey, Gaudron and McHugh JJ; [1991] HCA 43. 167 (1999) 200 CLR 485 at 505 [45]; [1999] HCA 65. "This Court is placed by s 73 of the Constitution at the apex of a judicial hierarchy to give decisions upon the common law which are binding on all courts, federal, State and territorial." The undoubted importance of this Court's role as ultimate appellate court and the concomitant necessity to do all that is necessary to effectuate the main purpose of that grant of judicial power were factors which the plaintiff said underpinned a proposition advanced on his behalf, namely that a power to remit matters within its original jurisdiction was part of, or essential to, the effective exercise of this Court's appellate jurisdiction. That was said to be supported, first by the plaintiff's characterisation of State Supreme Courts as "an enduring and entrenched repository for the exercise of the implied remitter power", and secondly, by relying upon the expansion of this Court's appellate jurisdiction following the creation of a number of federal courts, as contemplated by s 71 of the Constitution, from which appeals could be brought to this Court (s 73(ii)). The plaintiff's proposition is unsustainable. State Supreme Courts It is incorrect to say that the jurisdiction of a State Supreme Court is "entrenched" or left as it previously stood before a conferral of federal jurisdiction in respect of the same subject matter is made under s 77(iii). Supreme Courts of the States did once possess jurisdiction in relation to some matters covered by s 75 of the Constitution but possession of that jurisdiction was authorised by State law operating independently of s 77(iii) of the Constitution. As explained by Isaacs J in Baxter v Commissioners of Taxation (NSW)168 the fact that State Supreme Courts may exercise jurisdiction in respect of subject matter once authorised by State law, is a circumstance which does not detract from or qualify in any way a later investing of a State court with federal jurisdiction under s 77(iii), which then is the source of federal jurisdiction in respect of that subject matter. 168 (1907) 4 CLR 1087 at 1143; [1907] HCA 76; cf Webb v Outtrim (1906) 4 CLR 356; [1906] HCA 76; see also Pirrie v McFarlane (1925) 36 CLR 170; [1925] HCA 30. Further, in Pirrie v McFarlane169 Knox CJ recognised that s 77(ii) authorised legislation that made the jurisdiction of this Court in certain matters exclusive of the State Supreme Courts. Section 71 of the Constitution vests the Commonwealth in "three repositories"170: the High Court, such other federal courts as Parliament creates and such other courts as Parliament invests with federal jurisdiction. By ss 77(i) and (ii) Parliament is empowered to make the High Court the exclusive repository of the matters enumerated in ss 75 and 76 as it sees fit. Nothing in s 77 suggests Parliament can take away the jurisdiction set out in s 75(v). judicial power of the Once a State Supreme Court is validly invested with federal jurisdiction, pursuant to s 77(iii), then under s 109 of the Constitution a State law conferring jurisdiction to do the same thing is no longer valid171 or is inoperative172. Section 39(1) of the Judiciary Act operates to remove the jurisdiction of State Supreme Courts in all nine matters enumerated in ss 75 and 76 in which this Court has original jurisdiction, and additional jurisdiction conferred by Parliament, and then invests jurisdiction in those State courts in some, but not all, of those enumerated matters. Thereafter the jurisdiction of this Court (except as otherwise provided by s 39) is exclusive of that of State courts173. As explained in the joint judgment of Gleeson CJ, Gaudron and Gummow JJ in Australian Securities and Investments Commission v Edensor Nominees Pty Ltd174: "A State court receives State jurisdiction under the constitution and laws of that State. It may also be invested with federal jurisdiction by a law made by the Parliament under s 77(iii) of the Constitution; s 39(2) of the Judiciary Act 1903 (Cth) is an example of such a law. The federal courts 169 (1925) 36 CLR 170 at 176 per Knox CJ. The case concerned s 38A of the Judiciary Act (introduced in 1907 and later repealed in 1976) and a dispute concerning direct appeals to the Privy Council from State Supreme Courts. 170 Bailey, "The Federal Jurisdiction of State Courts", (1940) 2 Res Judicatae 109 at 171 Ffrost v Stevenson (1937) 58 CLR 528 at 573 per Dixon J; [1937] HCA 41. 172 Felton v Mulligan (1971) 124 CLR 367 at 412 per Walsh J; [1971] HCA 39. 173 Felton v Mulligan (1971) 124 CLR 367 at 413 per Walsh J. 174 (2001) 204 CLR 559 at 571 [7]; [2001] HCA 1. established by the Parliament, the Federal Court of Australia, the Family Court of Australia and the Federal Magistrates Court, exercise their jurisdiction, necessarily federal, by reason of its conferral by laws enacted under s 77(i) of the Constitution. A 'matter' in respect of which that jurisdiction is conferred may, in a given case, include claims arising under common law or under the statute law of a State. But the jurisdiction invoked remains, in respect of all of the claims made in the matter, 'wholly' federal; even in a State court 'there is no room for the exercise of a State jurisdiction which apart from any operation of the Judiciary Act the State court would have had' and 'there is no State jurisdiction capable of concurrent exercise with the federal jurisdiction invested in the State court'. These terms were used by Barwick CJ in Felton v Mulligan." (footnotes omitted) Creation of federal courts As mentioned, the plaintiff also relied on the expansion of this Court's appellate role upon the creation of a number of federal courts (pursuant to s 71), from which appeals could be brought to this Court (s 73(ii)), as further demonstration of the need for this Court to remit matters falling outside what were described by the plaintiff as its "principal functions". That argument involved some tacit acknowledgement that for many decades matters within the original jurisdiction of this Court under s 75(v) were exclusively dealt with by this Court. However narrowly the principal functions of the Court may be described for certain purposes, including the purpose of characterising the Court's current work, the importance of the Court's original jurisdiction under s 75(v) of the Constitution has never been doubted and that importance has been re-emphasised recently in Bodruddaza v Minister for Immigration and Multicultural Affairs175. As a practical aside, it is worth mentioning that this Court's additional original jurisdiction under s 76 of the Constitution concerning patent matters176 subsisted for many decades without any implied power to remit such matters, 175 (2007) 228 CLR 651; [2007] HCA 14; see also Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476. 176 For example under the Patents Act 1952 (Cth), as originally enacted, rectification of the Register (s 32), extension of patents (s 90), revocation of patents (s 99), compulsory licences (s 108) and revocation for non-working of patents (s 109). Cf the Patents Act 1990 (Cth), Ch 16 especially ss 154 and 155. before such jurisdiction was conferred on other courts by Parliament. There is no doubt that the Federal Court set up by and under the Federal Court of Australia Act 1976 (Cth) owed its origins in part to a perceived need to relieve this Court of an excessive work load177. With the commencement of the Federal Court a great deal of the original jurisdiction conferred on the High Court by s 76 was invested in the Federal Court in matters like patents and taxation. Equally, there is no doubt that the Federal Magistrates Court was set up, in part, to relieve the excessive work load on the Federal Court in certain matters. Relevantly, jurisdiction of the Federal Court to hear claims for prerogative relief, subject to some exceptions, is now conferred by and defined in s 39B(1) of the Judiciary Act which provides: "Subject to subsections (1B), (1C) and (1EA), the original jurisdiction of the Federal Court of Australia includes jurisdiction with respect to any matter in which a writ of mandamus or prohibition or an injunction is sought against an officer or officers of the Commonwealth." Section 39B(1EA) covering civil proceedings relevantly provides that the Federal Court does not have jurisdiction in relation to s 75(v) matters to the extent that jurisdiction has been invested in the Federal Magistrates Court. A power of this Court to remit matters necessarily involves the investiture of other courts with jurisdiction in respect of the subject matter of a proceeding. This Court's statutory powers of remitter in the Judiciary Act have been considered by this Court from time to time. In Johnstone v The Commonwealth ("Johnstone")178 Aickin J considered the words "federal court, court of a State or court of a Territory that has jurisdiction with respect to the subject-matter and the parties" appearing in s 44 of the Judiciary Act. He said179: "the effect of s 44 is to confer federal jurisdiction on State courts in cases where this Court remits a case to them, and that federal jurisdiction is in 177 Sir Garfield Barwick (then Minister for External Affairs), "The Australian Judicial System: The Proposed New Federal Superior Court", (1964) 1 Federal Law Review 1 at 9. 178 (1979) 143 CLR 398; [1979] HCA 13. 179 Johnstone (1979) 143 CLR 398 at 408-409; cf at 402 per Gibbs J and at 407 per those same matters in which this Court has federal jurisdiction by virtue of s 75 of the Constitution … This jurisdiction is conferred on the State courts by the Parliament, not by this Court. What s 44 does is not to authorize this Court to confer federal jurisdiction on the State courts. What it does is to confer federal jurisdiction on State courts in cases where this Court is authorized to remit the proceedings to State courts and does in fact so remit." Further, it was noted by Gummow J in Re Jarman; Ex parte Cook180 that exercising a power of remitter is a "step in [a] sequence" involving the investment or conferral of original jurisdiction on a federal or a State court by operation of s 44(3) of the Judiciary Act181. His Honour said182: "Section 44(3) … operates … as a law under s 77(i) of the Constitution defining the jurisdiction of a federal court other than the High Court, or as a law under s 77(iii) of the Constitution investing any court of a State with federal jurisdiction." What is critical to this proceeding in terms of subject matter, parties, and s 44 of the Judiciary Act is that s 476B(1) of the Act provides that, subject to quite limited exceptions in s 476B(3), "the High Court must not remit a matter, or any part of a matter, that relates to a migration decision to any court other than the Federal Magistrates Court" and s 476B(2) provides that the High Court must not remit a matter to the Federal Magistrates Court unless that Court has jurisdiction in relation to a matter under s 476. Section 476B(4) provides that: "Subsection (1) has effect despite section 44 of the Judiciary Act 1903." 180 (1997) 188 CLR 595 at 634; [1997] HCA 13. 181 Section 44(3) provides: "(3) Where the High Court remits a matter, or any part of a matter, under subsection (2) or (2A) to a court: that court has jurisdiction in the matter, or in that part of the matter, as the case may be; and subject to any directions of the High Court, further proceedings in the matter, or in that part of the matter, as the case may be, shall be as directed by that court." 182 Re Jarman; Ex parte Cook (1997) 188 CLR 595 at 633. It was accepted by a majority of this Court in Abebe v The Commonwealth ("Abebe")183 that ss 476(1)-(3), 481(1)(a), 485 and 486184 of the Act were validly enacted and that s 485185 could prevent the Federal Court from exercising any jurisdiction that it would not otherwise have possessed when a matter was remitted to it pursuant to s 44 of the Judiciary Act. Having regard to the express terms of ss 476B(1), (3) and (4), until Parliament decides to invest the Federal Magistrates Court with jurisdiction in respect of the subject matter of a "primary decision" as defined in the Act and decisions under s 474(7), this Court is not authorised under s 44 of the Judiciary Act, or the Act, or by implication, to remit this proceeding to the Federal Magistrates Court. Insofar as the plaintiff's contention that Parliament cannot make the original jurisdiction under s 75(v) of the Constitution exclusive to the High Court depends on an argument that this Court's general constitutional and appellate jurisdiction (including the importance of the appellate function in respect of State Supreme Courts) cannot be exercised effectively without an implied power to remit matters falling within its original jurisdiction, the contention is wrong and must fail. Judicial power of the Commonwealth It is well understood that judicial power includes taking actions of a kind recognised as "within the concept of judicial power as the framers of the Constitution must be taken to have understood it"186. This is not necessarily to be 183 (1999) 197 CLR 510; [1999] HCA 14. 184 As they stood between 1994 and 2001. 185 Abebe (1999) 197 CLR 510 at 522 [20], 534 [50] per Gleeson CJ and McHugh J. 186 R v Davison (1954) 90 CLR 353 at 382 per Kitto J; [1954] HCA 46; see also White v Director of Military Prosecutions (2007) 81 ALJR 1259 at 1272-1273 [45]-[49] per Gummow, Hayne and Crennan JJ; 235 ALR 455 at 468-469; [2007] HCA 29 and Thomas v Mowbray (2007) 81 ALJR 1414 at 1435 [66] and 1443-1444 [116]- [121] per Gummow and Crennan JJ; 237 ALR 194 at 218 and 229-230; [2007] HCA 33. described as inherent jurisdiction which has been called "an elusive concept"187. As recognised in United Mexican States v Cabal188: "The grant of judicial power carries with it authority to do all that is necessary to effectuate its main purpose". Undoubtedly there are exceptional circumstances in which this Court might decline to exercise jurisdiction in respect of a matter within its original jurisdiction, an obvious example being where the proceedings constitute an abuse of process. Further, the Court may decline to exercise its jurisdiction where a matter may be remitted pursuant to the statutory power in s 44 of the Judiciary Act189. A power to remit must be conditioned upon the basis that a receiving court has jurisdiction in respect of at least the subject matter190. The plaintiff also relied, by way of analogy, on the writ of procedendo permitting a remitter back to an inferior court by a superior court in circumstances where there had been an incorrect removal of a cause to the superior court on an application for certiorari or other prerogative relief including habeas corpus. The analogy is imperfect and unhelpful in the context of urging an implied power to remit, because the writ of procedendo operated to return a matter to an inferior court to enable it to resume the jurisdiction it undoubtedly possessed191. If anything, the writ more closely resembles, but then only somewhat, the powers of this Court under s 42(2) of the Judiciary Act. Finally, it was asserted that an implied power to remit a matter within the original jurisdiction of this Court did not differ from various powers associated with the Court's power to protect and control proceedings before it. Examples given included powers to order a stay, pending a hearing of a special leave 187 Grassby v The Queen (1989) 168 CLR 1 at 16 per Dawson J; [1989] HCA 45. 188 (2001) 209 CLR 165 at 180 [37] per Gleeson CJ, McHugh and Gummow JJ; [2001] HCA 60. See also Grassby v The Queen (1989) 168 CLR 1 at 16 per Dawson J: "In the discharge of that responsibility [for the administration of justice] it [a superior court of unlimited jurisdiction] exercises the full plenitude of judicial power." 189 Re Jarman; Ex parte Cook (1997) 188 CLR 595 at 634 per Gummow J. 190 Johnstone (1979) 143 CLR 398. 191 R v T [1995] 2 Qd R 192 at 194 per McPherson JA. application192, to grant an injunction pending a hearing193 including a Mareva injunction, to grant bail194, to punish for contempt195 and to prevent an abuse of process196. An implied power to prevent an abuse of process does not extend a court's jurisdiction beyond that which is vested in it197. None of those considerations obliges the conclusion that the judicial power of the Commonwealth supports an implication of a power to remit, to another court, a matter within the original jurisdiction of this Court. First the implication of such a power is contrary to the express terms of s 77. Just as fundamentally, this Court's power to control proceedings before it and make orders to do all that is necessary to effectuate a grant of jurisdiction to it does not include preventing a person from invoking the jurisdiction of the Court198. Further, incidental powers in respect of issues such as contempt of court or concerning the preservation of the subject matter of proceedings are distinct from the power of remitter. 192 Jennings Construction Ltd v Burgundy Royale Investments Pty Ltd [No 1] (1986) 161 CLR 681; [1986] HCA 84; Attorney-General (UK) v Heinemann Publishers Australia Pty Ltd (1987) 61 ALJR 612; 75 ALR 461; [1987] HCA 45. 193 Tait v The Queen (1962) 108 CLR 620 at 624-625; [1962] HCA 57. 194 United Mexican States v Cabal (2001) 209 CLR 165 at 180 [37] per Gleeson CJ, 195 Re Colina; Ex parte Torney (1999) 200 CLR 386 at 397 [25] per Gleeson CJ and Gummow J, 429 [113] per Hayne J; [1999] HCA 57. 196 Walton v Gardiner (1993) 177 CLR 378 at 392-393 per Mason CJ, Deane and 197 Jackson v Sterling Industries Ltd (1987) 162 CLR 612 at 619 per Wilson and Dawson JJ; [1987] HCA 23; see also at 620-621 per Brennan J. 198 Commonwealth Trading Bank v Inglis (1974) 131 CLR 311 at 314-315 per Barwick CJ and McTiernan J; [1974] HCA 17; Voth v Manildra Flour Mills Pty Ltd ("Voth") (1990) 171 CLR 538 at 564 per Mason CJ, Deane, Dawson and Gaudron JJ; [1990] HCA 55. Henry v Henry (1996) 185 CLR 571 at 587 per Dawson, Gaudron, McHugh and Gummow JJ confirmed the adoption in Voth of the test of Deane J in Oceanic Sun Line Special Shipping Company Inc v Fay (1988) 165 CLR 197 at 247-248; [1988] HCA 32. See generally Quick and Garran, The Annotated Constitution of the Australian Commonwealth, (1901) at The power to invest original jurisdiction of this Court in another court, whether concurrently, partially, or wholly, is entirely a matter for Parliament as provided by s 71 and there is no fetter in s 77 as to how Parliament can define the federal jurisdiction of any federal court other than the High Court. This Court cannot remit a matter to the Federal Magistrates Court when Parliament has chosen not to invest that Court with relevant jurisdiction. The Federal Magistrates Court lacks the authority to deal with the subject matter and accordingly this Court lacks the authority to remit the matter to that Court. To the extent that the plaintiff contended that a consideration of the judicial power of the Commonwealth obliges an implication that Parliament must ensure that there be a court other than this Court with concurrent jurisdiction in relation to every matter in which this Court has original jurisdiction under s 75(v), that contention is misconceived and must also fail. Exclusivity of the High Court's original jurisdiction The plaintiff's third contention, that the Constitution does not envisage that the Court's original jurisdiction may be made exclusive by Parliament, is contrary to the express terms of s 71 and ss 77(i) and (iii) of the Constitution, which were principally relied on, and to which reference has already been made. Whilst s 71 of the Constitution empowers Parliament to vest the judicial power of the Commonwealth in federal courts, which include this Court199, it is s 77 which confers a power to define the jurisdiction of such a court by an Act of Parliament. Section 77 gives power to Parliament not only to define the jurisdiction of any federal court other than the High Court (s 77(i)) but also to define the extent to which the jurisdiction of any federal court is exclusive of the jurisdiction which is invested in any courts of the States (s 77(ii)) and to determine which, if any, courts of a State should be invested with federal jurisdiction (s 77(iii)). In Abebe, Gleeson CJ and McHugh J200 approved the statement of Gibbs CJ concerning the power to define jurisdiction under s 77 in Stack v Coast Securities (No 9) Pty Ltd201: 199 Pirrie v McFarlane (1925) 36 CLR 170 at 176 per Knox CJ. 200 (1999) 197 CLR 510 at 534 [48]; see also at 603 [274] per Callinan J. 201 (1983) 154 CLR 261 at 281; [1983] HCA 36. "Under the Constitution, the jurisdiction of a federal court can be defined only by an Act of the Parliament, and the jurisdiction so defined can be as wide as, or narrower than, (but not of course wider than) the matters mentioned in ss 75 and 76." Furthermore, in Abebe, as already noted, a majority of this Court upheld the validity of provisions202 which restricted severely the jurisdiction of the Federal Court to review certain decisions of the Refugee Review Tribunal, which resulted in a significant number of proceedings being commenced in the original jurisdiction of this Court pursuant to s 75(v) of the Constitution. Nevertheless the majority saw nothing in ss 75, 76 and 77 of the Constitution which prevented the Parliament from enacting ss 476, 485 and 486 of the Act203 and nothing in s 77(i) or Ch III which required Parliament to give a federal court authority to decide every aspect of a controversy merely because it had jurisdiction over some aspect of that controversy. In relation to the challenge to validity in this proceeding, there is nothing in ss 71, 75, 76 or 77 of the Constitution which prevents the Parliament from enacting ss 476(2)(a) and (d) of the Act. Equally, it would be open to Parliament at some time in the future to vest to such extent as it could, and as it saw fit, jurisdiction in one of the federal courts created by it in respect of "primary decisions" as defined in the Act and in respect of decisions under s 474(7). The fetters on Parliament relevant to the arguments advanced are that it could not (in the absence of constitutional amendment) wholly divest this Court of its original jurisdiction set out in s 75(v) of the Constitution or, as already mentioned, vest jurisdiction in a federal court wider than the matters mentioned in ss 75 and 76204. The position in relation to the claims of invalidity of ss 476(2)(a) and (d) of the Act is clear, and no particular, or further, illumination is likely to be gained by considering the position in other jurisdictions, such as the United States of America, with different constitutional arrangements in relation to the original jurisdiction of the final court in the judicial hierarchy. It was recognised in Re Jarman; Ex parte Cook205 that the Judiciary Act proceeds on the footing that this 202 See [190]. 203 Abebe (1999) 197 CLR 510 at 534 [50] per Gleeson CJ and McHugh J; see also to similar effect Kirby J at 590 [231] and Callinan J at 603 [273]. 204 Stack v Coast Securities (No 9) Pty Ltd (1983) 154 CLR 261 at 281 per Gibbs CJ. 205 (1997) 188 CLR 595 at 634 per Gummow J. Court may refrain from exercising its original jurisdiction where another court is invested with relevant federal jurisdiction, and that the Supreme Court of the United States of America has developed a comparable doctrine but for the reasons already given, such doctrines are not relevant to the facts here. Conclusion The considerations dealt with above show that there is nothing "inherent in the text and structure of the Constitution"206 to support implication of a power in this Court to remit to the Federal Magistrates Court a "primary decision" as defined in the Act or a decision of the kind mentioned in s 474(7). Orders 207 Question 1 should be answered: Yes. Question 2 should be answered: Unnecessary to answer. Question 3A should be answered: Section 476(2)(a) and s 476(2)(d) are not invalid. It is unnecessary to answer the balance of the question. Question 3B should be answered: Question 4 should be answered: Does not arise. Question 5 should be answered: The plaintiff should pay the costs of the case stated. 206 Lange (1997) 189 CLR 520 at 567.

HIGH COURT OF AUSTRALIA TRAVEL COMPENSATION FUND APPELLANT AND ROBERT TAMBREE T/AS R TAMBREE AND ASSOCIATES & ORS RESPONDENTS Travel Compensation Fund v Robert Tambree t/as R Tambree and Associates [2005] HCA 69 16 November 2005 ORDER Appeal allowed with costs. Set aside the orders of the Court of Appeal of the Supreme Court of New South Wales made on 26 February 2004 and in their place order that the appeal to that Court be dismissed with costs. On appeal from the Supreme Court of New South Wales Representation: J E Marshall SC with N F Francey and M J O'Meara for the appellant (instructed by McCabe Terrill) P B Walsh for the first respondent (instructed by Burston Cole & Co) R E Dubler SC with H Sonmez for the second respondent (instructed by Phillips Fox) No appearance for the third to fifth respondents Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Travel Compensation Fund v Robert Tambree T/as R Tambree & Associates Trade Practices – Fair Trading Act – Misleading or deceptive conduct – Person who suffers loss or damage by conduct of another in contravention of Act. Damages – Causation – Whether illegal conduct severed the chain of causation – Travel Compensation Fund established as part of national scheme for regulation of travel agents – Fund compensated members of the public who suffered loss by reason of an act or omission of a travel agent – Travel Shop International ("TSI") was a participant in the Fund – Financial statements of TSI prepared by first respondent and audited by second respondent in support of TSI's continued participation in the Fund – Appellant acted in reliance on information about the financial position of TSI – Respondents knew of such reliance – Respondents negligent and engaged in misleading or deceptive conduct in preparing and auditing the financial statements of TSI – Unlawful trading by TSI a cause of the damage suffered by the appellant. Damages – Causation – Statutory context relevant to determining approach to causation – Application of common law approach to causation in the context of the Fair Trading Act – Whether policy considerations and value judgments relevant. Fair Trading Act 1987 (NSW), ss 42, 68. Travel Agents Act 1986 (NSW). GLEESON CJ. This appeal concerns an issue of causation that arose in assessing damages against an accountant and an auditor who were held to have been negligent, and to have engaged in misleading or deceptive conduct in contravention of s 42 of the Fair Trading Act 1987 (NSW) ("the Fair Trading Act"). The appellant took proceedings in the Supreme Court of New South Wales and succeeded in its claim for damages, both at first instance before Austin J1, and in the Court of Appeal2. However, the Court of Appeal substantially reduced the damages awarded. In order to explain how the issue as to damages arises it is necessary to state, in broad terms, the statutory and factual basis of the first and second respondents' liability to the appellant. The travel compensation scheme Uniform State legislation has established a national scheme for the regulation of travel agents. The relevant New South Wales legislation is the Travel Agents Act 1986 (NSW) ("the Travel Agents Act"). One aspect of the regulatory scheme involves a compensation fund designed to safeguard people who suffer loss by reason of an act or omission of a travel agent. One form of such loss involves paying in advance for travel services and, through default on the part of the agent, not receiving the services. The scheme was examined by Lehane J in Travel Compensation Fund v Travel Guide Pty Ltd (in liq)3. The Travel Compensation Fund ("the Fund") is administered by a group of trustees, originally the responsible Ministers in a number of States, who were appointed pursuant to a Deed of Trust ("the Deed") dated 12 December 1986. By virtue of s 52 of the Travel Agents Act the trustees may sue and be sued in the name of the Fund. The existence of the Fund is recognised by the Travel Agents Act and the regulations made under that Act. Travel agents may apply to become "participants" in the scheme established by the Deed. A participant is, by definition, a travel agent licensed under a State Act who meets certain prescribed eligibility requirements. Participation is on an annual basis. A Management Committee determines whether applicants should be admitted as participants, and conducts annual financial reviews to determine whether participation should be renewed. The eligibility criteria are based on financial security, determined by reference to audited financial statements. Failure to meet the criteria could result in a requirement to obtain a bank guarantee, or to invest more capital in the 1 Travel Compensation Fund v Fry [2002] NSWSC 1044. 2 Tambree v Travel Compensation Fund (2004) Aust Contract Reports ¶90-195. (1997) 72 FCR 371. business, or it could result in denial or loss of participation. The Travel Agents Act requires all travel agents to be licensed (s 6). It is a condition of all licences that the licensee be a participant in the compensation scheme (s 11(2)). Clause 15 of the Deed provides: "15.1 Subject to this Deed, the Trustees shall pay compensation out of the Fund to a beneficiary - (a) who is a client; and (b) who has suffered or may suffer pecuniary loss arising directly from a failure to account for money or other valuable consideration by a participant - where - the failure to account arises from an act or omission by the participant or an employee or agent of the participant; and the client is not protected against the loss by a policy of insurance. 15.2 The Trustees may in their absolute discretion: pay compensation to a beneficiary under clause 15.1 in relation to any consequential pecuniary loss suffered by reason of a failure to account; and pay compensation, including compensation in relation to any consequential pecuniary loss suffered by reason of a failure to account, to a person to whom they are not required to pay compensation under clause The word "beneficiary" is defined to include a person who entrusts money to a travel agent. The trustees hold the Fund on trust for the Crown in right of the States and for every person who entrusts money to a travel agent in connection with travel arrangements if the travel agent fails to account for the money. In such a context, failure to account includes, and typically involves, failure to apply money for the purpose for which it was entrusted to the agent4. 4 Roxborough v Rothmans of Pall Mall Australia Limited (2001) 208 CLR 516 at The purpose of the discretionary power conferred by cl 15.2, and the manner in which the power is commonly exercised, was the subject of evidence before Austin J, who said: "Claims were dealt with by the Management Committee either under clause 15.1, under which [the appellant] must make a claim for pecuniary loss suffered directly from a failure to account by a participant in the Fund if the requirements of that provision are satisfied, or under clause 15.2 where the Trustees are given a discretion, in certain circumstances, to pay compensation to a person whose claim does not fall within clause 15.1. Mr Brattoni [an officer of the Fund] gave evidence explaining how the Trustees exercise their discretion under clause 15.2. He said that cases under clause 15.2 normally involve unlicensed agents. Commonly participation in the Fund is terminated and then the Department of Fair Trading takes steps to terminate the travel agent's licence and close the business. That is what happened in the present case. In considering claims, the Trustees look to the date of termination of participation in the Fund and the date of any payments made after that termination. If the Trustees form the opinion that members of the public with whom the travel agent dealt would be unlikely to know, when they paid their money to the agent, that they were surrendering their money to an unlicensed operator, and there was no unusually long period of time between the termination and the payment of money to the agent, the Trustees would be likely to exercise their discretion in favour of the claimant. Mr Brattoni's evidence is that the Trustees exercised their discretion upon the basis of such considerations in the present case." The practical significance of cl 15.2 is obvious. Business failures are not always neat and tidy. People often attempt to trade out of financial difficulties. As in the present case, there sometimes can be an interval between financial failure, loss of a licence, and complete closure of a business. Clause 15.2 was designed to protect members of the public who deal with agents in such circumstances. The compensation payments The payments made by the Fund, which gave rise to these proceedings, followed what Austin J described as the collapse of a business carried on at 366 Church Street, Parramatta under the name of "The Travel Shop International". The business was established by Ms Renee Fry. Ms Fry and her father were also sued in the original proceedings, and much of the judgment of Austin J is devoted to the resolution of factual and legal questions that are no longer directly in issue. The issues were blurred by the fact that, when her business was in the process of collapse, Ms Fry, "informally transferred" it to a company named The Travel Shop International Pty Ltd. That company ("TSIPL") had been incorporated in October 1996. Ms Fry was the sole director and shareholder. However, Austin J found it possible to reach reasonably confident conclusions about the financial history of Ms Fry trading as The Travel Shop International, and those conclusions are not in dispute in this appeal. Ms Fry was the principal of the business, but her father was in charge of the accounting side. In 1996 Ms Fry sought, and obtained, admission as a participant in the Fund. She applied successfully for a travel agent's licence. She was issued with Licence No 2TA4438. She did not commence trading until early 1997. She specialised in arranging holidays in Fiji and Bali. The financial statements of the firm for each of the years ended 30 June 1997 and 30 June 1998 were prepared by the first respondent and audited by the second respondent. They were submitted to the Fund in support of the firm's continued participation, which was essential for the maintenance of the travel agent's licence. The auditor's report noted that the financial statements had been prepared for distribution to, inter alia, the trustees of the Fund. Austin J found that both the first and second respondents knew that the financial statements would be sent to, and relied upon, by the Fund for the purpose of maintaining participation. There was a major issue at the trial, resolved adversely to the first and second respondents, arising out of an allegation that the financial statements of The Travel Shop International omitted to disclose substantial liabilities as at 30 June 1997 and 30 June 1998. One of the major creditors of the firm was Metro Travel, a wholesaler of airline tickets. As at 30 June 1997, the firm owed Metro $65,684. By 30 June 1998, the amount was $152,615. It later increased to $163,237. The financial statements for the year ended 30 June 1997, which were completed in December 1997, showed no current liabilities. They reported a net profit of $24,702. The financial statements for the year ended 30 June 1998, which were prepared in November 1998, showed no current liabilities. They reported a net profit of $8,337. It is unnecessary, for present purposes, to examine the detail of Austin J's reasons for concluding that the financial statements were false and misleading. He accepted the evidence of an expert witness, Mr Humphreys, that, if adjusted to reflect the true position of the firm, the 1997 and 1998 statements should have shown a material deficiency of assets to liabilities, and a significant trading loss. An officer of the Fund said that, in February 1999, when a field audit was conducted, Mr Fry said that he had been "naughty" in not disclosing the creditors in the firm's accounts. It is also unnecessary to examine his Honour's reasons for concluding that the first and second respondents had been negligent in preparing and auditing the financial statements respectively, and that they had engaged in misleading conduct in contravention of s 42 of the Fair Trading Act. From mid-1998 Metro Travel began to press for payment of its debt. Pressure upon Ms Fry from a number of creditors increased. Austin J, after considering some "very unclear" evidence found that Ms Fry "informally transferred the business to TSIPL as from some time in November 1998" and that "from November 1998 onwards, TSIPL conducted the travel agency business that had previously been conducted by Ms Fry trading as 'The Travel Shop International'". From that time, moneys received from clients were paid into a bank account of TSIPL. Bearing in mind that Ms Fry was the sole director and shareholder of TSIPL, the informality of the "transfer" is understandable. The stationery used in connection with the business continued to quote licence No 2TA4438. The licence was still held by Ms Fry. In February 1999, following complaints from creditors, the Fund decided to do the field audit mentioned above. Mr Fry said he was negotiating to sell the business, and asked for ten days to complete the negotiations. He said that if the business closed immediately there would be a loss of client funds, and claims on the Fund. On 18 February 1999, Ms Fry sent a letter to the Fund saying that she wished to cease participation. On 23 February 1999, the Fund terminated her participation. From 23 February to 20 April 1999 Ms Fry and her father continued to conduct, from the same premises, the business of a travel agency, although the firm's licence had ceased to have effect when it lost its right to participate in the "Mr Brattoni sought emergency approval of claims for clients of The Travel Shop who had not received valid travel documents after paying deposits. Mr Brattoni put in place arrangements whereby another travel agent called San Michele Travel took over all bookings that had been made by The Travel Shop International and completed them, on the basis that compensation would be available from [the Fund] to make up differences between the cost of re-booking and refunds upon cancellation. In April 1999 the Department of Fair Trading changed the locks at 366 Church Street Parramatta and placed chains on the door, precluding Ms Fry and Mr Fry from having access to the premises and effectively bringing to an end the business, which they allege to have been conducted at that time by [another entity]. Subsequently proceedings were taken by the Department of Fair Trading in this Court, leading to orders banning The Travel Shop International, Ms Fry and Mr Fry from operating as travel agents for a period of five years from the date of the orders, made in May 1999." Between the end of February 1999 and the forced closure of the business in April 1999, Ms Fry used stationery that referred to a number of entities associated with her and her father. Austin J gave several examples. Two will suffice for present purposes. Itinerary details and a booking acknowledgment were provided under a letterhead "The Travel Shop International Pty Ltd" and in font "Incorporating Fiji & Bali Resorts smaller Lic No. 2TA4438". A receipt was issued with a letterhead referring to "The Travel Shop ... Lic No. 2TA004438 [sic]" and at the foot of the page "The Travel Shop International Pty Ltd Affiliated with: Fiji Resorts International Pty Ltd Bali Resorts International Pty Ltd" and the name Renee Fry in bold letters. International Ltd Austin J found that, faced with evidence of serious misrepresentations by Ms Fry in the financial statements for 1997 and 1998, and complaints of failure to pay debts, the Fund acted reasonably in terminating Ms Fry's participation. He also found that, after it emerged that Ms Fry appeared to be continuing to trade, the Department of Fair Trading acted reasonably in shutting down the business. The Fund received a large number of claims from people who dealt with The Travel Shop International in 1999, paid deposits and other moneys, and did not receive the services for which they paid. The Fund accepted claims, and made payments to claimants, in the total amount of $143,050. Some of the claims related to moneys paid before 23 February 1999 ($13,320). Most claims related to moneys paid between that date and 20 April 1999. The findings on liability and the assessment of damages The appellant claimed that the conduct of the first respondent in preparing the financial statements of Ms Fry trading as The Travel Shop International for the years ended 30 June 1997 and 30 June 1998, and the conduct of the second respondent in auditing those statements and signing the audit reports attached to them, contravened s 42 of the Fair Trading Act, which prohibits a person from, in trade or commerce, engaging in conduct that is misleading or deceptive. Austin J accepted that contention. Section 68 of the Fair Trading Act provides that a person who suffers loss or damage by conduct of another person that is in contravention of s 42 may recover the amount of loss or damage by action against the other person. Austin J held that the appellant had suffered loss or damage by conduct of the first and second respondents in contravention of s 42. He concluded that their conduct caused the appellant to suffer loss in the amount of $143,050. In reaching that conclusion, he accepted evidence that, if the financial statements had shown a true and fair view of the financial position of the business, the appellant would have required either bank guarantees or substantial increases of capital as a condition of permitting continued participation in the Fund. Austin J found that "[f]ailure to comply with the requirement for a bank guarantee or capital injection would have resulted ... in determination of Ms Fry's participation in the Fund, with the result that she would not have been able to carry on the business of a travel agent lawfully." Austin J also found that the first and second respondents owed the appellant a common law duty of care, and acted in breach of that duty. They knew that the financial statements were prepared for submission to the Fund for the purpose of Ms Fry's renewal applications. Austin J held that the appellant relied on the statements, and that such reliance was reasonable. The same loss resulted from the negligence as from the contravention of the Fair Trading Act. The loss found by Austin J was the amount paid to claimants under cl 15 of the Deed. What Austin J said in that respect about cl 15.2 has been set out earlier in these reasons. It was directly relevant to his assessment of damages. He summarised the appellant's case on causation, which he accepted, as being that, by reason of the conduct of the first and second respondents, the appellant renewed Ms Fry's participation in the Fund and thereby permitted her to continue to trade as a licensed travel agent until February 1999. In consequence, the appellant suffered the loss constituted by meeting the claims. The conduct of the first and second respondents allowed a state of affairs to develop in which Ms Fry was able to continue to trade and expose clients (directly) and the appellant (indirectly) to loss. He said, referring to a submission put on behalf of the second respondent, that proper discharge of his auditing duties would have led to a chain of regulatory events that would have prevented the loss in fact suffered by the appellant. He accepted that most of the claims in question were treated by the appellant as discretionary claims under cl 15.2 of the Deed because the failure to account, even where the payments had been made before 23 February 1999, arose while the business was unlicensed. By the time the losses of the clients were incurred, the business had been taken over by TSIPL, which was not a participant. However, the trustees of the Fund were obliged to exercise their discretion under cl 15.2 in a fiduciary capacity, acting for proper purposes and upon relevant considerations. Austin J held that they acted properly in discharge of their fiduciary obligations in paying the claims. The Court of Appeal accepted the reasoning of Austin J in all respects but one, which is the point in issue in the present appeal. Sheller JA, with whom Mason P and Ipp JA agreed, noted that, of the total amount of claims paid by the appellant ($143,050), only $13,320 was for compensation to consumers who had made payments before 23 February 1999. He observed that, in the period that followed, until the premises at 366 Church Street, Parramatta were closed by licensing inspectors on 20 April 1999, when dealing with the public, TSIPL quoted Mr Fry's licence number. All the claims other than those represented by the amount of $13,320 were in respect of business done during that period. Sheller JA concluded that the loss resulting from such claims was not causally related to the negligence of the first and second respondents. Accordingly, the Court of Appeal reduced the amount of damages awarded to the appellant to The reasoning of Sheller JA turned upon the illegality of Ms Fry's conduct (and perhaps that of her father) in continuing to operate, or cause TSIPL to operate, the business at 366 Church Street, Parramatta. He asked himself whether that conduct "severed the chain of causation". In answering that question, he referred to normative considerations affecting the determination of issues of causation, citing, among other authorities, a passage in the judgment of Ipp JA in Ruddock v Taylor5, where it was said that issues of causation may involve two questions, one factual and one normative, and that the ultimate question to be answered on the second aspect is whether the defendant ought to be held liable to pay damages for that harm. Sheller JA said: "As a value judgment I do not think that what Ms Fry did following her termination of participation could be regarded as a normal occurrence. A person would not normally terminate the licence which enabled that person to conduct a travel agent's business and yet continue to conduct that business illegally." He concluded: "[The second respondent's] conduct in negligently preparing a misleading audit occurred in the context of supporting Ms Fry's application to participate in the scheme. [The appellant] relied upon this conduct in its pleading by claiming that the accounts and audit induced [the appellant] to permit Ms Fry to continue in the scheme and accordingly engage in the business of a travel agent. She subsequently ceased to carry on that business in her own name, and a little later, ceased to participate in the scheme. It is not clear from the findings whether thereafter she did other than work for TSIPL, which seems to have made use of her licence number. [The first and second respondents] knew that the accounts and audit certificate were to aid Ms Fry continuing in the scheme and engaging in business as a licensed travel agent. However in my opinion, by no test could it be said that the negligently prepared accounts and audit and the misrepresentations that flowed from them, were causally related to her continuing illegally in the business of a travel agent. The example given by counsel for [the second respondent] of the negligent testing of a potential driver being causally related to the driver negligently injuring a person while continuing to drive after the licence was cancelled, seems to me apposite. On this ground, in my opinion, both the appeal and the cross-appeal should be upheld to the extent that [the appellant] is not entitled to recover the amount of compensation paid to those claimants who suffered loss as the result of Ms Fry's activities after 23 February Causation The reasoning of Sheller JA commenced by identifying the problem to be addressed in the present case as one involving the "intervention of other immediate causes" between breach of duty (common law and statutory) and (2003) 58 NSWLR 269 at 286 [87]. harm. In such a case, he said, while it has been recognised that a "but for" test of causation may have an important negative function, it is inadequate as a comprehensive positive test6. The intervening immediate cause of the loss related to business activities after 23 February 1999 was said to be the illegal conduct of Ms Fry and TSIPL in unlicensed trading. Then, Sheller JA said, the solution to the problem required the exercise of a value judgment. The loss in question was that incurred by the appellant in meeting claims under cl 15.2 of the Deed. As Austin J pointed out, although the power exercised in paying those claims was discretionary, in the fiduciary context in which they were paid the payments represented properly incurred expenses. The Court of Appeal appeared to have no difficulty with that. However, the evidence referred to by Austin J in the passage quoted above as to the regulatory purpose of cl 15.2 was not referred to in the reasons of Sheller JA. It shows that payment of claims resulting from the activities of unlicensed operators in the relatively brief interval that often occurs between loss of participation rights and physical closure of a business is the very kind of thing to which cl 15.2 was directed. Whether claims on the Fund are made under cl 15.1 or cl 15.2, there will always be the conduct of a third party, described as failure to account, in between the breach of statute or negligence on the part of an accountant or auditor involved in providing financial statements to the appellant, and the suffering of harm by the appellant. Such conduct may well involve illegality. The Fund does not exist only to protect the public against lawful behaviour. A travel agent's failure to account, whether the agent be licensed or unlicensed, will always be the occasion of the kind of loss suffered by the appellant in meeting claims under cl 15 of the Deed. Typically, as in the present case, the failure to account will be related to financial difficulties in which the agent is involved. That is why agents are required to provide financial statements in support of applications to become, and remain, participants in the compensation scheme. The whole purpose of the scheme is to protect the public against loss resulting from dealing with defaulting agents. Default commonly results from financial failure, and failure to account by an agent may well involve some form of illegality. When the appellant called for audited financial statements, the kind of loss to the public, and the kind of loss to itself, against which it sought protection was loss that would always involve an agent's failure to account. It is not in doubt that issues of causation commonly involve normative considerations, sometimes referred to by reference to "values" or "policy". However, as Stephen J pointed out in Caltex Oil (Australia) Pty Ltd v The Dredge "Willemstad"7, the object is to formulate principles from policy, and to 6 See Medlin v State Government Insurance Commission (1995) 182 CLR 1 at 6. (1976) 136 CLR 529 at 567. apply those principles to the case in hand. In the context of considering an issue of causation under the Fair Trading Act, the statutory purpose is the primary source of the relevant legal norms8. The case did not call for a value judgment about the conduct of Ms Fry. Why her failure to account, after she lost her licence, in respect of moneys paid to her company while it was illegally trading under her licence should be treated differently from her failure to account, after she lost her licence, in respect of moneys paid after she lost her licence but before the authorities took steps to close down her business, is not apparent. that, To acknowledge in appropriate circumstances, normative considerations have a role to play in judgments about issues of causation is not to invite judges to engage in value judgments at large. The relevant norms must be derived from legal principle. In this case, the primary task of the Court is to apply the legislative norms to be found in the Fair Trading Act, although the outcome is not materially different to applying the common law of negligence. Section 68 of the Fair Trading Act, in its application to a contravention of s 42, gives rise to the same questions as does s 82 of the Trade Practices Act 1974 (Cth) in its application to a contravention of s 52 of that Act. In recent cases, this Court has pointed out that, in deciding whether loss or damage is "by" misleading or deceptive conduct, and assessing the amount of the loss that is to be so characterised, it is in the purpose of the statute, as related to the circumstances of a particular case, that the answer to the question of causation is This is a case of known reliance, and negligent misrepresentation. The aspect of trade and commerce which attracted the operation of s 42 of the Fair Trading Act was the conduct of the business of a travel agent, in a regulatory context that provided for a scheme of compensation for members of the public who suffer loss through failure to account on the part of defaulting agents. That scheme exposed the appellant to claims for compensation, and to the risk of loss by reason of payments made under cl 15 of the Deed. Because of cl 15.2, and the way it worked in practice, as explained in the evidence, the risk to which the appellant was exposed included the risk of claims for compensation by people who dealt with a travel agent who was no longer a participant in the Fund and I & L Securities Pty Ltd v HTW Valuers (Brisbane) Pty Ltd (2002) 210 CLR 109 at 9 Henville v Walker (2001) 206 CLR 459 at 470 [18], 489-490 [96], 509-510 [164]- [165]; I & L Securities Pty Ltd v HTW Valuers (Brisbane) Pty Ltd (2002) 210 CLR 109 at 119 [26], 125-126 [50], 135-136 [84]. See also, more generally, Allianz Australia Insurance Ltd v GSF Australia Pty Ltd (2005) 79 ALJR 1079; 215 ALR was operating following loss of a licence – perhaps attempting to trade out of financial difficulties. To protect itself against that risk, as well as to protect the public, the appellant required information about the financial position of participating agents. It acted in reliance on that information in making decisions about continuing participation, including decisions as to whether to require further security or additional funding. The first and second respondents participated in the provision of such information, knowing that it was for the purpose of such reliance. The statute prohibited misleading conduct by them. They engaged in misleading conduct by the part they played in the provision of false financial information. Misrepresentation will rarely be the sole cause of loss. If, in reliance on information, a person acts, or fails to act, in a certain manner, the loss or damage may flow directly from the act or omission, and only indirectly from the making of the representation10. Where the reliance involves undertaking a risk, and information is provided for the purpose of inducing such reliance, then if misleading or deceptive conduct takes the form of participating in providing false information, and the very risk against which protection is sought materialises, it is consistent with the purpose of the statute to treat the loss as resulting from the misleading conduct. The compensation scheme was not limited to providing compensation for failure to account by agents who had current licences at the time of the failure to account. Clause 15.2 of the Deed makes that clear. People whose businesses collapse may well attempt to trade out of their difficulties; and there may well be an interim period between termination of participation in the Fund, with consequent loss of licence, and physical closure of a business by action of the regulatory authorities. The risk that an insolvent agent (as Ms Fry appears to have been) would keep trading until forced by the authorities to close down, and that claims would be made under cl 15.2, was part of the risk against which the appellant was seeking to protect itself when it considered the financial statements of Ms Fry. The illegality of Ms Fry's conduct did not take it outside the scope of the risk against which the appellant attempted to obtain protection. That is made obvious by a consideration of the operation of cl 15.1 of the Deed. A failure to account, by a licensed agent who is still a participant in the Fund, could well involve illegality of some kind. There might be an issue, in a given case, about whether a loss to the appellant in such a case was causally related to misrepresentation by providing erroneous financial statements. If it were so related, however, it would be unlikely that illegality would be an answer to any 10 Sellars v Adelaide Petroleum NL (1994) 179 CLR 332 at 356-357; Henville v Walker (2001) 206 CLR 459 at 469 [14]. issue of causation. Loss following reliance on negligently prepared financial statements often arises in circumstances of illegal conduct on the part of someone against whose default protection is sought. It could hardly be the case that the appellant could only recover damages from a negligent accountant or auditor in the case of a failure to account by an agent whose conduct involved no illegality. The answer to the problem of causation in the present case is to be found, not in a value judgment, but in an accurate identification of the nature of the risk against which the appellant sought protection and of the loss it suffered, considered in the light of the kind of wrongful conduct in which the first and second respondents engaged. The considerations discussed above in relation to the claim under the Fair Trading Act are of equal force in relation to the common law claims for negligence. The conclusion of Austin J was correct. Orders The appeal should be allowed with costs. The orders of the Court of Appeal should be set aside and in their place it should be ordered that the appeal to that Court be dismissed with costs. GUMMOW AND HAYNE JJ. We agree with Gleeson CJ that the appeal should be allowed and consequential orders made in the form proposed. We agree that what happened in this case can be described as the occurrence of the very risk against which the appellant sought to protect itself by seeking and obtaining the accounting information it did. The first and second respondents11 each knew that the appellant intended to rely on the accuracy of the accounting information he supplied. The information that was provided by each was false. Providing that information to the appellant was conduct that was misleading or deceptive, or likely to mislead or deceive. Had the respondents acted with reasonable care, neither would have supplied the false information that was supplied. Describing what happened as the occurrence of the very risk against which the appellant sought to protect itself looks at events from the appellant's point of view. That is far from irrelevant, but the respondents contended that it is a conclusion which obscures whether the circumstances in which the risk eventuated are relevant to deciding whether the respondents should be held liable for the losses that ensued. The respondents submitted that in this case the circumstances in which the appellant suffered the loss it did, require the conclusion that the respondents were not to be held responsible for that loss, or at least the greater part of it. Much of the loss the appellant suffered related to dealings Ms Fry, or Ms Fry and her father, had with customers after 23 February 1999. Ms Fry's participation in the Travel Compensation Fund was terminated on 23 February 1999. The dealings that took place after that date were dealings by an unlicensed travel agent and, for that reason, were unlawful12. It does not matter whether the dealings were with Ms Fry, Ms Fry and her father, or a company which Ms Fry controlled (The Travel Shop International Pty Ltd). At first instance, Austin J accepted13 that the appellant acted reasonably in resolving to terminate Ms Fry's participation in the Fund and, no less importantly, that "the Department of Fair Trading acted reasonably in shutting down the business and denying Ms Fry and Mr Fry access to the premises". 11 The third to fifth respondents did not appear and took no part in the argument of the appeal. It is convenient to refer to the first and second respondents as if they alone were named as respondents to the appeal. 12 Travel Agents Act 1986 (NSW), s 6. 13 Travel Compensation Fund v Fry [2002] NSWSC 1044 at [119]. These findings were not disturbed on appeal to the Court of Appeal. In particular, there is no basis in the findings made at trial or in the reasons of the Court of Appeal to conclude that any "unusually long period of time [elapsed] between the termination [of participation in the fund] and the payment of money to the agent"14 by customers before the business was shut down by the Department of Fair Trading. Events taking this course, the characterisation of the trading after 23 February 1999 as illegal, even though correct, is irrelevant to the question whether the appellant suffered loss "by" the respondents' contraventions of the prohibition in s 42 of the Fair Trading Act 1987 (NSW). It is irrelevant because the legal characterisation of the conduct of Ms Fry does not bear upon whether the respondents' conduct was a cause of the appellant's loss. In particular, the continued, albeit illegal, trading of Ms Fry (whether alone or with others) was found to be trading which, had the respondents acted properly, would have been prevented. It is now clear that there are cases in which the answer to a question of causation will differ according to the purpose for which the question is asked15. As was recently emphasised in Allianz Australia Insurance Ltd v GSF Australia Pty Ltd16, it is doubtful whether there is any "common sense" notion of causation which can provide a useful, still less universal, legal norm. There are, therefore, cases in which the answer to a question of causation will require examination of the purpose of a particular cause of action, or the nature and scope of the defendant's obligation in the particular circumstances17. In Allianz18, McHugh J noted that considerations of legal policy may enter into the selection of those causative factors which are determinative of liability. However, to accept that proposition, as it should be, is not to adopt a quite different proposition that in any given case the ultimate issue is whether "the 14 [2002] NSWSC 1044 at [122]. 15 Chappel v Hart (1998) 195 CLR 232 at 256 [63]-[64] per Gummow J, 285 [122] per Hayne J; Environment Agency v Empress Car Co (Abertillery) Ltd [1999] 2 AC 22 at 29, 31 per Lord Hoffmann. 16 (2005) 79 ALJR 1079 at 1095 [96]-[97] per Gummow, Hayne and Heydon JJ; 215 ALR 385 at 406-407. 17 Kuwait Airways Corpn v Iraqi Airways Co (Nos 4 and 5) [2002] 2 AC 883 at 1091 [70]-[71] per Lord Nicholls of Birkenhead. 18 (2005) 79 ALJR 1079 at 1089 [55]; 215 ALR 385 at 398. defendant ought to be held liable to pay damages for [the] harm [suffered]". This approach to questions of causation taken by Ipp JA in Ruddock v Taylor19 was adopted by the Court of Appeal in the present case20. In Sullivan v Moody21, this Court, in the joint judgment of five Justices, affirmed the rejection in Australia of what has been identified as the three-stage approach in negligence cases adopted by Lord Bridge of Harwich in Caparo Industries Plc v Dickman22. This appended to questions of duty and foreseeability of damage a criterion of what in the given situation was "fair, just and reasonable". Of this, it was said in Sullivan v Moody23: "The question as to what is fair, and just and reasonable is capable of being misunderstood as an invitation to formulate policy rather than to search for principle. The concept of policy, in this context, is often ill-defined. There are policies at work in the law which can be identified and applied to novel problems, but the law of tort develops by reference to principles, which must be capable of general application, not discretionary decision-making in individual cases." There are indications in the United Kingdom that, in determining for the law of tort questions of sufficient or determinative causal linkage, a similar approach to that in Caparo should be adopted by asking whether as "a value judgment" the defendant ought to be held liable24. However that may be, the considerations referred to in Sullivan v Moody when affirming the rejection in Australia of Caparo apply likewise to the approach taken by the Court of Appeal in this case by reference to Ruddock v Taylor. In the present case, where one of the claims made (and the claim to which most attention was given both in the courts below and in this Court) was a 19 (2003) 58 NSWLR 269 at 286 [86]-[89]. 20 Tambree v Travel Compensation Fund [2004] Aust Contract Rep ¶90-195 at 21 (2001) 207 CLR 562 at 579 [49] per Gleeson CJ, Gaudron, McHugh, Hayne and 22 [1990] 2 AC 605 at 617-618. 23 (2001) 207 CLR 562 at 579 [49]. 24 Kuwait Airways Corpn v Iraqi Airways Co (Nos 4 and 5) [2002] 2 AC 883 at 1090-1091 [69]-[71] per Lord Nicholls of Birkenhead. statutory claim, "notions of 'cause' as involved in [that] statutory regime are to be understood by reference to the statutory subject, scope and purpose"25. In particular, the question presented by s 68 of the Fair Trading Act was whether the conduct of each respondent, that constituted a contravention of that Act, was a cause of the loss or damage sustained26. The characterisation of Ms Fry's conduct as unlawful was not relevant to that inquiry. Although these conclusions about the Fair Trading Act suffice to require the allowing of the appeal, it is as well to add that the appellant's claim in negligence neither required nor permitted some different answer to the question of causation that had to be answered in demonstrating liability for that tort. Ms Fry's continued trading, after her participation in the Fund was terminated, was not an intervening event that broke the chain of causation between the negligent misstatements the respondents made and the loss the appellant suffered. The appellant relied on the accuracy of the statements made by the respondents. The appellant's reliance on the statements, its conduct in terminating Ms Fry's participation, and its conduct after the termination, were all held to be reasonable. Had the respondents not acted as they did, the appellant would not have suffered loss because the regulatory steps that were taken to stop Ms Fry trading would have been taken much sooner than they were. No question of value judgment, about the extent of loss for which the respondents should be held liable, arose in this case. 25 Allianz Australia Insurance Ltd v GSF Australia Pty Ltd (2005) 79 ALJR 1079 at 1095 [99] per Gummow, Hayne and Heydon JJ; 215 ALR 385 at 407. 26 I & L Securities Pty Ltd v HTW Valuers (Brisbane) Pty Ltd (2002) 210 CLR 109 at 119 [26] per Gleeson CJ, 128 [57] per Gaudron, Gummow and Hayne JJ. Kirby KIRBY J. I agree in the orders proposed by the other members of this Court. However, I do not agree with the ways in which error on the part of the Court of Appeal of New South Wales is there expressed so as to justify the restoration of the judgment of the primary judge in the Supreme Court of New South Wales (Austin J)27. There was error; but in my view it was different from that identified in the other reasons. The facts, legislation and common ground The facts are stated by Gleeson CJ28. His Honour explains the manner in which the Travel Compensation Fund ("the Fund") was constituted, the recovery of payments out of which is in issue in this appeal29. Also explained there is the relevant legislation, being the Travel Agents Act 1986 (NSW)30 ("Travel Agents Act") and the Fair Trading Act 1987 (NSW)31 ("Fair Trading Act"). It is by reference to the former Act that the object and design of the travel compensation scheme, providing for payments from the Fund (the appellant in this appeal), is to be understood. It is by reference to the latter Act32 that the claim by the Fund for recovery against the accountant and an auditor of the defaulting travel agent (the first and second respondents in this appeal), is chiefly to be judged. The Fund also brought its claim relying on negligence by the respondents at common law. As other reasons explain, the Fair Trading Act limits the recovery by a person found to have engaged in misleading or deceptive conduct by reference to a concept of a causal connection between the impugned conduct and the loss or damage suffered. This result is achieved in consequence of the use in the Fair Trading Act of the preposition "by" in s 68(1). In the same way as s 82 of the Trade Practices Act 1974 (Cth) ("Trade Practices Act") has been interpreted, s 68 of the Fair Trading Act, in its reference in sub-s (1) to contraventions of s 42 of 27 Travel Compensation Fund v Fry [2002] NSWSC 1044. 28 Reasons of Gleeson CJ at [9]-[19]. 29 Reasons of Gleeson CJ at [3]-[6], with reference to Travel Compensation Fund v Travel Guide Pty Ltd (In liq) (1997) 72 FCR 371. 30 Reasons of Gleeson CJ at [3]. 31 Reasons of Gleeson CJ at [1]; [30]-[31]. 32 Notably, s 42. Kirby that Act, presents the question whether a causal connection has been established between a breach of that Act and the amount of the loss or damage claimed33: "The measure of damages hangs on the words 'by conduct'; the preposition 'by' has been interpreted to mean 'by reason of' or 'as a result of'." In the context of a claim, such as this, arising out of statutory provisions, it is self-evident that the starting point for charting the boundaries of contested issues of causation is a thorough examination of the facts and of the statute. In such matters, the duty of a court is not, as such, to give effect to common law notions but faithfully to carry into force the objects of the legislation, as understood from the language and structure of the statutory text34. To this extent, I agree with what has been written in this appeal by Callinan J35. Specifically, I agree that the test for resolving contested questions of causation, applicable to claims based on legislation such as the Fair Trading Act, remains that stated by this Court in March v Stramare (E & M H) Pty Ltd36. Relevantly, it is as explained in the passage from the reasons of Mason CJ in March, extracted by Callinan J37. There is no occasion in this appeal to alter or re-express what was stated there. It follows that the reasons of Gummow and Hayne JJ are correct in pointing out that the extent of the liability of the respondents to the Fund was to be ascertained by the application of the Fair Trading Act38. Yet, as will often be the case, in charting the limits of such legal liability, both at common law and 33 Munchies Management Pty Ltd v Belperio (1988) 58 FCR 274 at 286 applied in I & L Securities Pty Ltd v HTW Valuers (Brisbane) Pty Ltd (2002) 210 CLR 109 at 34 Trust Co of Australia Ltd v Commissioner of State Revenue (2003) 77 ALJR 1019 at 1033 [92]; 197 ALR 297 at 316; Roy Morgan Research Centre Pty Ltd v Commissioner of State Revenue (Vict) (2001) 207 CLR 72 at 89 [46]; Victorian Workcover Authority v Esso Australia Ltd (2001) 207 CLR 520 at 544-545 [62]- [64]; The Commonwealth v Yarmirr (2001) 208 CLR 1 at 111-112 [249]; Allan v Transurban City Link Ltd (2001) 208 CLR 167 at 184-185 [54]; The Queen v Lavender (2005) 79 ALJR 1337 at 1357 [107]; 218 ALR 483 at 548. 35 Reasons of Callinan J at [79]. 36 (1991) 171 CLR 506. 37 Reasons of Callinan J at [80] citing (1991) 171 CLR 506 at 515. 38 Reasons of Gummow and Hayne JJ at [49]. Kirby under such legislation39, the outer bounds will be defined by similar notions of commonsense, practicality and reasonableness40, as these concepts appeal to judges expressing the common law, and to Parliament enacting legislation such as the Fair Trading Act. Values and policy judgments in issues of causation Approach to issues of causation: The point of departure of my reasoning from that of my colleagues concerns any attempt to restate or qualify the approach to issues of causation explained by Mason CJ in March, by excluding from that approach the "second question" that his Honour identified as integral to such decisions. His Honour described this "second question" ("whether a defendant is in law responsible for damage which his or her negligence has played some part in producing"41) as one to be answered in determining whether recovery was available in the particular case. It cannot be doubted that this is a policy question where value judgments have to be resolved. The contrary proposition is inconsistent with both earlier and later authority of this Court. Nothing in the Fair Trading Act suggests the need for a different approach in that statutory context. The authority of this Court: There are many other remarks by judges of this Court that acknowledge explicitly that identifying the outer limits of legal recovery for loss or damage, in cases of this kind, cannot be explained solely by reference to the "but for" test of temporal relationships; nor to considerations of "commonsense" or other such verbal formulae. Thus in Wardley Australia Ltd v Western Australia42, the joint reasons of four members of this Court analysed the limits of recovery under s 82 of the Trade Practices Act. They did so by reference to various considerations culminating in what is declared, in the circumstances, to be a matter of "justice" and "reasonableness", "practical" and "fair" and "sensible"43. Clearly, these are words connoting a value judgment of 39 Referring to Fleming, The Law of Torts, 7th ed (1987) at 172-173; Hart and Honoré, Causation in the Law, 2nd ed (1985) at 110. 40 Fitzgerald v Penn (1954) 91 CLR 268 at 277-278. 41 (1991) 171 CLR 506 at 515. 42 (1992) 175 CLR 514 at 533. 43 Wardley (1992) 175 CLR 514 at 533. See also Chappel v Hart (1998) 195 CLR 232 at 270 [93.3]; Rosenberg v Percival (2001) 205 CLR 434 at 449 [45], 463-464 [91], 487 [160]-[161], 504-505 [221]-[223]; I & L Securities (2002) 210 CLR 109 at 154 [144]; Stapleton, "Perspectives on Causation" in Horder (ed), Oxford Essays in Jurisprudence, 4th series (2000) 61 at 77. Kirby the kind identified in March. To say the least, they do not conjure up the image of a refined rule or precise principle of law. Several times, before and since Wardley, this Court has acknowledged that decisions about the outer boundary of recovery in contested questions of causation cannot be reduced to a neat verbal formula. This is what Gummow J44 and I45 each meant in our reasons which sustained the majority conclusion in Chappel v Hart. We each referred to the need to temper results produced by the mechanical application of legal formulae by reference to values and normative considerations. In fact, the reasons of Gummow J, in Chappel, could not have been clearer46: "the 'but for' test is not a comprehensive and exclusive criterion, and the results which are yielded by its application properly may be tempered by the making of value judgments and the infusion of policy considerations." In support of this by now orthodox position, his Honour referred to the foregoing passage in the reasons of Mason CJ in March47. More recently, the impossibility of deciding contested questions of causation, in cases of this kind, by reference to a legal formula or "legal principle" alone, and the necessity of taking values into account, was explained by McHugh J. He did so in Henville v Walker48. He repeated his approach in Allianz Australia Insurance Ltd v GSF Australia Pty Ltd where he said49: "Where several factors operate to bring about the injury to a plaintiff, selection of the relevant antecedent (contributing) factor as legally causative requires the making of a value judgment and, often enough, consideration of policy considerations. This is because the determination of a causal question always involves a normative decision." 44 Chappel (1998) 195 CLR 232 at 255 [62] referring to March (1991) 171 CLR 506 at 516 and Bennett v Minister of Community Welfare (1992) 176 CLR 408 at 413. 45 Chappel (1998) 195 CLR 232 at 269-270 [93.3]. 46 Chappel (1998) 195 CLR 232 at 255 [62] (citations omitted). 47 See above and the extract in the reasons of Callinan J at [80]. 48 (2001) 206 CLR 459 at 491-492 [100]-[101], [103]. 49 (2005) 79 ALJR 1079 at 1089 [55]; 215 ALR 385 at 398 (emphasis added) (citation omitted). Kirby In support of this last proposition, McHugh J referred, for authority, to the reasons of Gummow J in Chappel, thereby once again incorporating by reference the test stated by Mason CJ in March. The correct expression of the applicable principle This steady, frequently applied and unchallenged line of authority is now cast in doubt by unnecessary observations in this appeal criticising the references in the Court of Appeal to "value judgments". Given that, in referring to "value judgments", Sheller JA in that Court50 (and Ipp JA earlier in Ruddock v Taylor51 to which reference was there made) did no more than to use language repeatedly deployed by Justices of this Court, I consider that the criticism of them for doing so is unwarranted. Moreover, the criticism represents an attempt to return this area of legal discourse to the sophistry that suggested that contested questions of causation (including in cases such as the present) can be resolved by the application of a legal formula or by an appeal to a "legal principle". In Australian law, we have progressed beyond such a masquerade to a more candid acknowledgment that some questions, presented for judicial decision, are not susceptible to such verbal formulae. They require more detailed explanations. They oblige reference by the judicial decision-maker to the factors (whether the terms of any applicable statute or the purposes of the relevant rules of the common law) that lead him or her to the conclusion that is reached. It seems that unrealistic presumptions52, fictitious postulates53 and argument-closing "legal principles"54 may now be returning to vogue in Australia whereas, elsewhere in the common law, realism, a functional analysis and greater transparency in judicial reasoning represent the 50 Tambree v Travel Compensation Fund [2004] Aust Contract Rep ¶90-195 at 92,695 [139]. An extract appears in the reasons of Gleeson CJ at [24]. 51 (2003) 58 NSWLR 269 at 286 [87]. See now Ruddock v Taylor (2005) 79 ALJR 52 Neilson v Overseas Projects Corporation of Victoria Ltd (2005) 79 ALJR 1736 at 1773 [203]-[204] per Kirby J; cf at 1740 [10] per Gleeson CJ. The reference is to the adoption and application of a presumption of law that the law of China under consideration in that case was the same as the law of Australia. 53 Favell v Queensland Newspapers Pty Ltd (2005) 79 ALJR 1716 at 1722-1723 [23]- [24] per Kirby J. The reference is to the fiction of the "ordinary reader" of defamatory matter and the elaboration of the characteristics attributed to that fiction. 54 Reasons of Gleeson CJ at [28]-[29]. Kirby modern norms55. If this is what is meant by a return to "strict legalism", I respectfully decline to embrace it. Although I do not agree with all of his reasoning, I certainly concur in Callinan J's remark that, in deciding cases such as the present, tribunals of fact cannot resort to "an invariable scientific formula". They must draw on commonsense, experience, understanding, a multiplicity of community values and their own judgment. They should explain their reasoning "with candour" which "demands the acknowledgment … of the use of … common sense in determining causation [questions]"56. The difficulty presented by authority on Caparo Rejection of the three-stage approach: This is not an occasion to resume the argument over the suggested three-stage approach to the resolution of the duty question in negligence cases, adopted by the House of Lords in Caparo Industries Plc v Dickman57. That approach is now followed, in substance, in most common law countries58. I have acknowledged that, for the time being, it has been rejected in Australia by a majority of this Court in Sullivan v Moody59 and that it is my duty to conform60. (It would be a duty easier to fulfil if, in the place of the candid evaluation of applicable considerations of "whether it was fair, just and reasonable that the law should impose a duty of a given scope upon that tortfeasor for the benefit of that person"61 some alternative methodology had 55 See eg Kuwait Airways Corpn v Iraqi Airways Co (Nos 4 and 5) [2002] 2 AC 883 at 1090-1091 [69]-[71] per Lord Nicholls of Birkenhead. This passage is referred to with apparent disapproval by Gummow and Hayne JJ at [48]. 56 Reasons of Callinan J at [81]. 57 [1990] 2 AC 605 at 617-618. 58 See discussion in Graham Barclay Oysters Pty Ltd v Ryan (2002) 211 CLR 540 at 626 [238]; cf Witting, "The Three-stage Test Abandoned in Australia – or Not?", (2002) 118 Law Quarterly Review 214 at 220-221. The Caparo approach was recently adopted by the Singapore Court of Appeal: see The Owners of the Sunrise Crane v Cipta Sarana Marine Pty Ltd [2004] SGCA 42 per Yong Pung How CJ and Chao Hick Tin JA; Prakash J dissenting; cf Amirthalingam, "The Sunrise Crane – Shedding New Light or Casting Old Shadows on Duty of Care?" [2004] Singapore Journal of Legal Studies 551 at 553. 59 (2001) 207 CLR 562 at 579 [49]. 60 Ryan (2002) 211 CLR 540 at 626 [238]. 61 Ryan (2002) 211 CLR 540 at 623 [232]. Kirby been adopted by this Court that was equally clear and agreed). We are now buffeted, rudderless, on a rough sea and we have no sure compass62. It may be that, in determining contested questions of causation, the previous references in this Court to "the making of value judgments and the infusion of policy considerations"63 have now been seen as incompatible with the rejection, in Sullivan, of such "judgments" and "considerations" in the ascertainment of a duty of care. I can understand the difficulty that the reasoning in Sullivan presents for earlier judicial elaborations of causation in fact and law. However, on this topic, with respect, the supposed distinction between the "formulation of policy" and a "search for principle", referred to in Sullivan64 is illusory65. Commonly (although some deny it) legal principle is no more than the distilled product of earlier considerations of legal authority and legal policy66. Transparency in reasons: Ultimately, debates of this kind only demonstrate the unsatisfactory features of legal discourse on questions of causation67. Some judges, of a candid disposition, who bear allegiance to the principle of transparency in judicial reasons, will want, in explaining their conclusions on causation, to identify the "value judgments" and "policy considerations" to which they have had regard. Other judges, who feel uneasy about the acknowledgment of such factors and the consequent uncertainty of legal outcomes, may prefer to express the process of their decision-making as the inevitable application of "legal principle" to the facts. But, when analysed, any such "legal principle" (if it goes beyond the undisputed necessity in statutory claims to fulfil the purposes and assumptions of the statute68) is normally reduced to value judgments and policy considerations expressed in very broad language. This is so whether it is expressed by reference to what "commonsense" or "practicality" requires in the particular case or to what is "just", "reasonable", 62 Ryan (2002) 211 CLR 540 at 626 [238]-[239]. 63 Chappel (1998) 195 CLR 232 at 255 [62]. 64 Chappel (1998) 195 CLR 232 at 264-265 [87]-[88]. 65 Stapleton, "The golden thread at the heart of tort law: Protection of the vulnerable", (2003) 24 Australian Bar Review 135 at 135-140. 66 cf Dworkin, Taking Rights Seriously (1977) discussed in Kirby, Judicial Activism: Authority, Principle and Policy in the Judicial Method, Hamlyn Lectures, 55th series (2004) at 84. 67 Chappel (1998) 195 CLR 232 at 264-265 [87]-[88]. 68 Reasons of Gleeson CJ at [28]; reasons of Callinan J at [79]. Kirby "practical", "fair" and "sensible"69. If this is the kind of "legal principle" that my colleagues envisage, it is a legal principle of the most opaque variety which Professor Julius Stone described as a category of illusory reference70. In the end, there may be no practical difference between the ways the other members of this Court approach the resolution of this question in the present case and the way that I would do so. In a society, such as Australia, governed by the rule of law71, no one suggests that the outer limits of a person's legal liability for the causation of loss and damage (any more than for the existence of a duty of care in negligence) should depend upon judicial whim, or idiosyncratic "values" and wholly personal "policy considerations", conceived by the judge. Nevertheless, the point of difference concerns the extent to which judges, explaining their reasons on such questions, are duty bound to identify the considerations (in the statute, in past legal authority, in legal principle or policy, or in the facts of the particular case) that explain why those judges draw the boundary of legal liability at one point, and not at another. The decision of the Court of Appeal: In short, in a case such as the present, the question is why a judge would hold that it was legally proper to assign responsibility for the conduct of the unlicensed travel agent, Ms Fry, and the company under her control (Travel Shop International Pty Ltd), in carrying on trading, to the respondents. This is all that I take Sheller JA (and Mason P with Ipp JA who agreed with him) to have meant in referring to "value judgments". Their Honours did no more than use words and concepts that this Court has itself repeatedly deployed. There is no suggestion in their Honours' reasoning that they were embracing a notion that it was for them to give effect to a "value judgment at large"72 or to impose liability because they personally thought that to be a good thing. No more did they suggest such a course than Mason CJ earlier did in March or Gummow and I did in Chappel. Instead, the Court of Appeal was addressing a perfectly legitimate consideration – one undoubtedly invoking "value judgments" and "the infusion of policy". This was whether, in a claim under the Fair Trading Act, for loss or damage for misleading or deceptive conduct, the respondents were rendered liable in law for things done by other persons, the doing of which was illegal. 69 cf Wardley (1992) 175 CLR 514 at 533 per Mason CJ, Dawson, Gaudron and 70 Stone, Province and Function of Law (1946) at 171. 71 Australian Communist Party v The Commonwealth (1951) 83 CLR 1 at 193; Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476 at 513 [103]. 72 Reasons of Gleeson CJ at [29]. Kirby There are many cases where courts have had regard to the deliberate (especially criminal) wrong-doing of a third person and treated such conduct as severing the causal link between anterior conduct by a defendant and damage sustained by a plaintiff. There is nothing unusual or heterodox in such an approach73. It follows that the question that the Court of Appeal identified for itself in these proceedings was in no way unreasonable, unusual or erroneous. It was germane to the issue presented for decision. Once again, I agree with Callinan J that if this case were "one in which the appellant's loss stemmed only, or even substantially from conduct which was illegal, and as a result in particular of its illegal nature", the Court of Appeal's conclusion would have legal support74. Certainly, that would be an arguable conclusion. The Court of Appeal was therefore correct in considering it. Moreover, it was correct, in doing so, to resolve a contested issue of causation by reference to the criteria earlier identified by this Court in terms of "value judgments" and "policy considerations". The error of the Court of Appeal: It is at this point, nevertheless, that I disagree with the conclusion that the Court of Appeal reached. When the scheme of the Travel Agents Act, of the Trust Deed and of the practices of the Management Committee under that Deed are considered, the conclusion of the Court of Appeal on the causation question can be seen as erroneous. The conclusion of the primary judge was correct. My reasons for reaching this opinion are identical to those explained by Gleeson CJ, once the foregoing point of difference is excised75. Those reasons are anchored in the language and purpose of the Travel Agents Act, the provisions of the Trust Deed (and especially cl 15.2), the ordinary practice of the Fund operating in accordance with that Deed, and the reasonable conduct of members of the public dealing with an unlicensed travel agent whose unlicensed status was unknown to them, relying on the fact that the agent was licensed. Such reliance will be reasonable at least during the relatively brief interval, as occurred in this case, between discovery of the defaults of Ms Fry, her father and Travel Shop International Pty Ltd and the initiative taken by the Fund to notify the New South Wales Department of Fair Trading which took immediate steps to 73 At least since Hegarty v Shine (1878) 14 Cox CC 125. See Thomas Brown and Sons Ltd v Fazal Deen (1962) 108 CLR 391; Smith v Jenkins (1970) 119 CLR 397 at 403. The issue has often led to differences of judicial viewpoints: Jackson v Harrison (1978) 138 CLR 438; Modbury Triangle Shopping Centre Pty Ltd v Anzil (2000) 205 CLR 254. 74 Reasons of Callinan J at [84]. 75 Reasons of Gleeson CJ at [31]-[34]. Kirby obtain court orders and to close down Ms Fry's unlicensed travel agent's business. As Gleeson CJ points out, by reference to the legislative scheme, the Deed and the practice of the Fund, it is unconvincing to suggest that the Fund's entitlement to recover its payments was limited to cases where the travel agent's conduct involved no illegality76. In the words of Gummow and Hayne JJ, what happened as a result of misleading and deceptive conduct on the part of the accountant and auditor was "the very risk against which the [Fund] sought to protect itself by seeking and obtaining the accounting information it did."77 This was not, therefore, a case where the unlicensed and illegal activity of a third party severed the causal link between the respondents' respective conduct and the loss and damage suffered by the Fund. On the contrary, that loss and damage was precisely the kind of activity for which the Fund could be held liable by consumers and against which it was entitled to expect that the accountant and auditor would effectively protect its interests. In terms of the Fair Trading Act, it was a loss or damage suffered "by" the contravening conduct of other persons, namely the respondents. Neither the travel agent alone nor the consumers themselves could be classified as the sole, or even the main, cause of the relevant loss. It follows that the Court of Appeal erred in deleting from the judgment in favour of the Fund, awarded by the primary judge, the sums recovered by consumers from the Fund in respect of payments made between 23 February 1999 and the eventual closure of the business on 20 April 1999. This result follows, in my view, not from any misunderstanding by the Court of Appeal of the principles of causation expressed by this Court. Nor does it follow from the application of those principles to the claims made by the Fund based, respectively, on the Fair Trading Act and negligence at common law. To the contrary, Sheller JA expressed those principles accurately, in terms of this Court's repeated statements about them. At no stage did he or the other judges of the Court of Appeal pretend to a power to assign liability to the respondents by reference to open-ended "policy" or "values" alone. Sheller JA simply recognised that the verbal formulae and pretended "legal principles" were not sufficient, without more, to resolve the cut-off point of liability in a contested case of causation. That point is only discovered by a thorough examination of the facts, viewed by reference to the purpose of the legislation and to compatible value judgments and considerations of legal policy that are candidly disclosed. 76 Reasons of Gleeson CJ at [34]. 77 Reasons of Gummow and Hayne JJ at [40]. Kirby In a sense, it is the very transparency of the reasons of the Court of Appeal in this case, encouraged by this Court's past authority, that has assisted this Court to identify the Court of Appeal's error and now to correct it. Orders For these reasons I agree in the orders proposed by Gleeson CJ. Callinan CALLINAN J. I agree with the reasons for judgment and conclusion of the Chief Justice. I make these additional observations. The Court of Appeal approached the question of causation as if it were deciding a case at common law rather than a cause of action conferred by statute. As the Chief Justice has pointed out, in a case of the latter kind, the scope and objects of the relevant enactment are critically important, and bear closely upon any question of the meaning to be given to any language relating conduct to a consequence, that is, language directed to the question of causation, in this case, one word only, "by". But because I think that there was a departure by the Court of Appeal in its discussion and application of the common law principles relating to causation from those stated by this Court in March v Stramare (E & M H) Pty Ltd78, it should be made clear that that case continues to state the relevant common law on that topic for Australia. In March v Stramare, Mason CJ (with whom Gaudron J agreed) said "Commentators subdivide the issue of causation in a given case into two questions: the question of causation in fact – to be determined by the application of the 'but for' test – and the further question whether a defendant is in law responsible for damage which his or her negligence has played some part in producing80. It is said that, in determining this second question, considerations of policy have a prominent part to play, as do accepted value judgments81. However, this approach to the issue of causation (a) places rather too much weight on the 'but for' test to the exclusion of the 'common sense' approach which the common law has always favoured; and (b) implies, or seems to imply, that value judgment has, or should have, no part to play in resolving causation as an issue of fact. As Dixon CJ, Fullagar and Kitto JJ remarked in Fitzgerald v Penn82: 'it is all ultimately a matter of common sense' and '[i]n truth the conception in question [ie, causation] is not susceptible of reduction to a satisfactory formula.'" 78 (1991) 171 CLR 506. 79 (1991) 171 CLR 506 at 515. 80 See, for example, Fleming, The Law of Torts, 7th ed (1987) at 172-173; Hart and Honoré, Causation in the Law, 2nd ed (1985) at 110. 81 See Fleming, The Law of Torts, 7th ed (1987) at 173. 82 (1954) 91 CLR 268 at 277-278. Callinan With respect I agree with his Honour's observations. It would be a delusion to think that a disputed question of causation can be resolved according to an invariable scientific formula, and without acknowledgment that common sense, that is, the sum of the tribunal's experience as a tribunal, its constituents' knowledge and understanding of human affairs, its knowledge of other cases and its assessment of the ways in which notional fair minded people might view the relevant events, is likely to influence the result. Of course it is possible to say, sometimes with force, that tribunals may on occasions tend to become remote from the community and its values, indeed that there is not a community value as such, but a multiplicity of community values, themselves shifting from time to time, and that one person's common sense may sometimes be another's nonsense. But all of that is to say no more than that perfect justice, the availability of a perfect test for liability, is beyond human reach. But tribunals of fact have to do the best they can. And that which has to be done is better done with candour, and candour demands the acknowledgment by any tribunal or any judge called upon to resolve a matter, of the use of his or her common sense in determining causation. Value judgments may sometimes be inescapably involved, but that they may, does not justify the division of the question into a "but for" test and a further inquiry whether a defendant should in law be held responsible for a plaintiff's damage. It certainly appears that the Court of Appeal here did so divide the inquiry, adopting a two stage approach of the kind rejected by the majority of this Court in March v Stramare. The first stage of the inquiry resulted in a concurrent finding of fact in favour of the appellant83: "The next question is whether, bearing in mind the particular circumstances in which they negligently made misleading representations [the first and second respondents] should be held responsible for all of [the appellant's] loss. It is a matter of public importance that accountants should not, when asked to prepare financial reports of business entities, to be used by an agency such as [the appellant], act so negligently as to produce a misleading report. Even more so can this be said of an auditor who provides an auditor's certificate. These documents were about Ms Fry's financial affairs and were provided for [the appellant]. Again there are challenges on the facts to the conclusion that they fell within the scope of the risk." 83 Tambree v Travel Compensation Fund [2004] Aust Contract Rep ¶90-195 at 92,698 [154] per Sheller JA, Mason P and Ipp JA agreeing. Callinan The reason why the appellant failed at the second stage is, in effect, that a new event for which the first and second respondents could not be responsible was said to have intervened, the continuation of trading, illegally, by Ms Fry. The emphasis was upon the illegality of the trading. If this were a case not governed by legislation, and if it were one in which the appellant's loss stemmed only, or even substantially from conduct which was illegal, and as a result in particular of its illegal nature, I might well have decided it as the Court of Appeal did84. But it is not such a case. That the trading after the termination of the licence was illegal was incidental only. What is to the point are the facts that Ms Fry had been given a licence to trade, that it had been renewed, that she had traded under it, that it had been given a number, that the quotation of the number was probably necessary for continued trading in the travel business, that the licence had to be displayed at the place of business85, and in particular after the licence was terminated, that Ms Fry used it, and the number allocated to it, to continue to trade. Underlying these, and directly and naturally contributing to them, including the subsequent, incidentally illegal trading, were the negligent accounting and auditing, and the misrepresentations consequent upon them. It is likely that the erroneous adoption of the two stage test by the Court of Appeal led it into the further error of treating the illegality of the trading as a decisive disqualifying factor for an award of post-licence losses. The test propounded in March v Stramare would have, as I have said, produced a different result if this were a common law action. I would join in the orders proposed by the Chief Justice. 84 See Modbury Triangle Shopping Centre Pty Ltd v Anzil (2000) 205 CLR 254 at 302-303 [147]-[152] per Callinan J; State of New South Wales v Lepore (2003) 212 CLR 511 at 625 [342] per Callinan J. 85 Travel Agents Act 1986 (NSW), ss 33-35.

HIGH COURT OF AUSTRALIA APPLICANT NAFF OF 2002 APPELLANT AND MINISTER FOR IMMIGRATION AND MULTICULTURAL AND INDIGENOUS AFFAIRS & ANOR RESPONDENTS Applicant NAFF of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs [2004] HCA 62 8 December 2004 ORDER Appeal allowed. Orders of the Full Court of the Federal Court of Australia made on 31 March 2003 set aside, and in their place order that: the appeal to the Full Federal Court be allowed; and the order of Tamberlin J in the Federal Court of Australia made on 22 July 2002 be set aside. Order absolute for a writ of certiorari directed to the second respondent, quashing the decision of the second respondent in matter N00/32904 dated 19 March 2002. Order absolute for a writ of mandamus directed to the second respondent, requiring the second respondent to determine according to law the application for review of the decision of the delegate of the first respondent dated 15 March 2000. The first respondent pay the appellant's costs of the proceedings in the Federal Court of Australia before Tamberlin J, in the Full Federal Court and in this Court. On appeal from the Federal Court of Australia Representation: M N Allars for the appellant (instructed by the appellant) N J Williams SC with J D Smith for the first respondent (instructed by Sparke Helmore) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Applicant NAFF of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs Immigration – Refugees – Refugee Review Tribunal – Decision – Judicial review – Procedural fairness – Non-compliance with statutory duties – Tribunal concerned by inconsistencies in applicant's evidence at oral hearing – Tribunal said it would give the applicant a chance to respond in writing to its concerns – Whether Tribunal's failure to do so involved a failure to complete the review process – Whether failure involved a breach of the duty to conduct a review under s 414(1) of the Migration Act 1958 (Cth) – Whether failure involved a breach of the duty to hear from the applicant under s 425(1) – Whether reviewable error where absence of evidence from the applicant about effect of failure. Migration Act 1958 (Cth), ss 56, 414(1), 415(1), 425(1), 427(1)(b), 420, Pt 7 Divs 2-7A. McHUGH, GUMMOW, CALLINAN AND HEYDON JJ. Background On 1 September 1999, the appellant, a citizen of India but not of Australia, entered Australia. The appellant's application for a protection visa. On 30 September 1999, the appellant applied to the Department of Immigration and Multicultural and Indigenous Affairs ("the Department") for the grant of a protection visa. He claimed to be a Muslim Tamil who had a well-founded fear of political persecution in India, and hence was a non-citizen to whom Australia owed protection obligations under the 1951 Convention relating to the Status of Refugees as amended by the 1967 Protocol relating to the Status of Refugees. He therefore claimed that he fell within s 36(2) of the Migration Act 1958 (Cth) ("the Act"). The appellant advanced the following history. He was an active member of the Indian Union Muslim League and of a committee of the Jihad Movement. He was president of an organisation in his village in Tamil Nadu associated with a movement led by a benevolent Muslim industrialist, Dawood Ibrahim, whom he had met in Bombay. He was arrested with 30 other Muslims on 4 December 1998 and accused of planning to plant bombs. He was severely beaten before being released on 10 December 1998. He decided to flee India to save his life. He was arrested again some time after 11 January 1999 and beaten by the police, who unsuccessfully demanded his passport. He appeared to say that he had also been arrested on 15 April 1999, following the destruction of the local Hindu Temple, detained for two weeks, and tortured. On 15 March 2000, pursuant to s 65 of the Act, an officer of the Department, acting under delegation from the first respondent ("the Minister"), refused the appellant's application for a protection visa. That delegate rejected the appellant's contentions that he had met Dawood Ibrahim in India, that he was involved with the Jihad Movement, and that he was involved with Dawood Ibrahim's movement. The appellant's application for review of the delegate's decision. On 10 April 2000, the appellant applied to the Refugee Review Tribunal ("the Tribunal") for review of the delegate's decision pursuant to s 412 of the Act. With respect to the conduct of that review, s 425(1) of the Act provided: McHugh Callinan "The Tribunal must invite the applicant to appear before the Tribunal to give evidence and present arguments relating to the issues arising in relation to the decision under review." Section 425(2)(a) provided: "Subsection (1) does not apply if: the Tribunal considers that it should decide the review in the applicant's favour on the basis of the material before it …" Thus, s 425(1) created a duty on the Tribunal to invite the appellant to a hearing for the purposes described, unless s 425(2)(a) was satisfied. On 13 December 2001, the Tribunal wrote a letter to the appellant in which he was informed that the Tribunal was not prepared to decide the review in the appellant's favour on the material so far supplied. Hence, s 425(2)(a) was not satisfied. The letter went on to say that if the appellant wanted to come to a hearing, it would be held on 5 February 2002. In that manner the Tribunal complied with s 425(1). On 4 February 2002, in response to an invitation in the letter of 13 December 2001, a written submission prepared by a firm of lawyers and migration agents, together with supporting documents, was sent to the Tribunal. "Inconsistencies" in what the appellant said on 5 February 2002. At the proceedings on 5 February 2002, the appellant spoke in Tamil. An interpreter and a migration agent were present. Although some of the relevant events of that day are recorded in the decision of the Tribunal member, and although there is an audio recording of what was said, it has not been played to any of the courts that have considered this case, and there is no transcript of what was said. It is clear from the Tribunal member's reasons for decision that she engaged in close and sceptical questioning of the appellant. This questioning revealed inconsistencies in the appellant's evidence on various topics, one of which was the detentions to which the appellant claimed to have been subjected. The Tribunal member certainly appeared to form the view that there were inconsistencies in what the appellant had said about the dates on which he was detained and the number of times he was detained. Thus at one point in her reasons for decision she said: "The [appellant] stated that his second detention was in March 1999. He then stated that the second detention was in January 1999. The [appellant] stated that it was on the fourth Friday of January – he then stated that it was the fourth Friday in December. He then stated that the second McHugh Callinan detention was from 12 January 1999 for four or five days and then he was released on or around 14 or 15 January." Later she said: "[The appellant] stated that he was on bail at the time he left the country. He stated that he was released on 12 January 1999. The tribunal asked if January was the last time he was arrested by the Indian authorities. The [appellant] stated that he was not arrested after this time, he stated that he was living in hiding. The tribunal asked the [appellant] why he wrote in his statement to the [Department] that he was arrested on 14 April 1999 when he had just stated that the last time he was arrested was January and that he was in hiding after January? The [appellant] stated that he was arrested on two occasions. The tribunal pointed out that he was arrested on three occasions – December 1998, January 1999, and April 1999. The [appellant] stated that it is confusing." The conclusion of events on 5 February 2002. The parties agreed1 that proceedings before the Tribunal member on that day came to an end in the following way. The Tribunal member said: "Given that there are some inconsistencies with regard to the dates of the detentions and the number of detentions, I will have to write to you about those." After that statement had been interpreted, the Tribunal member said: "So what I will do is to write to you in the next couple of days and you will have 21 days in which to respond to my questions and to put any more information that you wish to the Tribunal." In fact, contrary to the procedure indicated on 5 February 2002, the Tribunal member did not write putting any questions to the appellant within a couple of days, or at all. On 25 February 2002, the Tribunal sent the appellant a letter saying that it had "considered all the material relating to your case" and had "made its decision", and that the decision would be handed down on 19 March 1 The agreement was not made until the Full Court hearing: NAFF of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs (2003) 127 FCR 259 at 271 [52]. McHugh Callinan 2002. On 19 March 2002, the Tribunal member handed down her reasons for affirming the delegate's decision not to grant a protection visa. The date of the decision for the purposes of the Act was 19 March 2002 (s 430B(4)), although the front page of the decision stated that it had been made on 22 February 2002. The Tribunal member's reasoning. First, the Tribunal member rejected various claims of the appellant in relation to Dawood Ibrahim and the Jihad Movement. She said that Dawood Ibrahim was regarded by the Indian authorities as a gangster whom they wished to arrest and who was resident in Dubai and Karachi, and who thus would be unlikely to have travelled to India and met the appellant. She noted an inconsistency between the appellant's claim to have been involved since 1993 at a high level in Dawood Ibrahim's movement, an organisation of "serious concern" to the Indian authorities, and the appellant's claim not to have attracted adverse attention until the end of 1998. She saw an inconsistency between the appellant's claim that he did not support violence and his claim to be involved with the Jihad Movement, a violent organisation. She suggested that, when she pointed this out to the appellant, he then shifted ground to a claim of having severed links with the Jihad Movement. She pointed to the appellant's claim to have been involved with the executive committee of the Jihad Movement at a time when it had not been established. Secondly, the Tribunal member accepted that the appellant was involved in the Muslim League, but said it was a moderate party, and that it was unlikely that the appellant had been persecuted for being involved in it. Thirdly, she pointed out that the appellant left India on a valid passport, and this would probably not have taken place if the Indian security forces had been concerned about the appellant. Hence the Tribunal member found that the appellant was not "of any adverse interest to the authorities in India". But the Tribunal member concluded that even if he had been, the difficulties he faced were only local difficulties, and he would not face them in any other part of India except his home town. She decided that he was free to move to many other places in India without risk of persecution, and that his financial position and employment prospects made it not unreasonable for him to do so. The appellant's application to the Federal Court of Australia. On 9 April 2002, the appellant filed an application in the Federal Court seeking orders under s 39B of the Judiciary Act 1903 (Cth) quashing the Tribunal's decision and McHugh Callinan requiring the Tribunal to redetermine the appellant's application for review of the delegate's decision to refuse a protection visa. On 22 July 2002, Tamberlin J dismissed the application2. On 31 March 2003, the Full Court (Lindgren and Stone JJ, Downes J dissenting) dismissed an appeal against that order3. The appellant was not represented in either court. The application under s 39B joined the Minister as the first respondent and the Tribunal as second respondent. But the Notice of Appeal to the Full Court joined only the Minister. The grant of special leave. On 12 March 2004, the appellant was granted special leave to appeal to this Court. At the hearing of the appeal, leave was granted to the appellant, who now was represented, to file an Amended Notice of Appeal joining the Tribunal as second respondent. Although various other matters had been agitated in the courts below, the only grounds of appeal to which the grant of special leave related concerned the statements of the Tribunal member on 5 February 2002 quoted above. The nature of the debate in this Court The affidavit which the appellant filed in the Federal Court did no more than annex the Tribunal's decision and repeat the grounds of relief set out in the application. It did not say that as a result of what he had been told on 5 February 2002 he did anything or abstained from doing anything; it did not say that he had been misled in any way; and it did not say what he would have done if the promised letter had been received. In his Notice of Appeal to the Full Federal Court against the order of Tamberlin J, the appellant said that if he had been given an opportunity to make submissions he would have dealt with the "[i]nconsistencies regarding the evidence". Because of this, the Minister advanced the following arguments for the view that there had been no denial of procedural fairness4. The appellant was on notice that his claims to have been involved with the Jihad Committee and Dawood Ibrahim's movement were highly controversial, since the Minister's 2 NAFF v Minister for Immigration and Multicultural and Indigenous Affairs [2002] FCA 946. 3 NAFF of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs (2003) 127 FCR 259. 4 The appellant placed no reliance on s 424A of the Act, and no issue in the appeal arises in relation to it. McHugh Callinan delegate had rejected them. The appellant's adviser had responded to the delegate's reasoning by providing submissions and documents to the Tribunal before the hearing which were in part directed to those questions. The appellant gave evidence that was internally inconsistent, inconsistent with his own earlier claims, and inconsistent with independent information. The appellant had been given an opportunity to be heard about the inconsistencies, including the inconsistencies relating to the dates and number of detentions referred to at the close of proceedings on 5 February 2002. At that point, the Tribunal member had fully discharged her obligations to accord procedural fairness. A later failure to do this could only be found if there was evidence that the appellant had been led by what was said on 5 February 2002 to do or forbear from doing anything; but there was no evidence of that kind. In any event, the inconsistencies mentioned at the close of proceedings on 5 February 2002 were not taken into account by the Tribunal in upholding the delegate's decision. The nature of the proceedings before the Tribunal The provisions governing the Tribunal's review of the decision by the Minister's delegate were in Pt 7 Divs 2-7A of the Act. The legislation provided for an inquisitorial, merits-based review by an independent tribunal. As might be expected in view of the importance of the proceedings, particularly for persons in the position of the appellant, the legislation was detailed, and it provided for procedures of some solemnity. Once an applicant had made a valid application for review of a delegate's decision, the Act imposed on the Tribunal a duty to review that decision: s 414(1). It provided that the Tribunal might exercise all the powers and discretions conferred by the Act on the delegate: s 415(1). It obliged the Tribunal to "pursue the objective of providing a mechanism of review that is fair, just, economical, informal and quick": s 420(1). The Secretary of the Department was obliged to give the Tribunal a statement about the decision under review setting out the findings of fact made by the delegate, referring to the evidence on which the findings were based, and giving the reasons for the decision: s 418(2). The Secretary was also obliged to give the Tribunal all other documentary material in the Secretary's possession or control, which the Secretary considered to be relevant to the review: s 418(3). There were provisions by which the applicant for review might supply, and the Tribunal might seek, information: ss 423 and 424. The Act also imposed duties on the Tribunal to supply the applicant with certain information for comment: ss 424A-424C. Section 425(1) compelled the Tribunal to invite the applicant to appear before it and detailed provision was made about the terms of that invitation: ss 425A and 426. McHugh Callinan Section 427 of the Act set out the powers of the Tribunal in conducting a review. They included powers to require the Secretary of the Department to make investigations and conduct medical examinations, to summon persons to appear to give evidence or produce documents, to require persons appearing to give evidence to take an oath or affirmation, and to direct the use of interpreters. Witnesses were obliged to attend, take an oath or make an affirmation and answer the Tribunal's questions on pain of criminal sanctions: ss 432 and 433. The Tribunal, its members and witnesses were given various forms of protection and immunities: ss 434 and 435. There were also detailed provisions for the handing down, recording and publication of decisions: ss 430-431. No party challenged the Tribunal member's power to make her closing statement. What was its source? Section 427(1)(b) granted a power to adjourn the review from time to time. The scope of that power must be considered against the background of s 420 which obliged the Tribunal to pursue an objective of acting fairly and according to substantial justice without being bound by technicalities. In that statutory context, the power to grant adjournments must have included a power to grant adjournments on conditions. In substance what happened here was that an adjournment was granted on condition that further material in writing was supplied on matters to be indicated by the Tribunal's questions. Another source of power may be found in a combination of ss 415(1)5 and 566. Section 56(2) conferred on the Minister a power, in considering an application for a visa, to invite, in writing, an applicant to give additional information in a specified way (for example, by answering questions), and s 415(1) conferred on the Tribunal the same power. 5 Section 415(1) provided: "The Tribunal may, for the purposes of the review of an RRT-reviewable decision, exercise all the powers and discretions that are conferred by this Act on the person who made the decision. 6 Section 56 provided: "(1) In considering an application for a visa, the Minister may, if he or she wants to, get any information that he or she considers relevant but, if the Minister gets such information, the Minister must have regard to that information in making the decision whether to grant or refuse the visa. (2) Without limiting subsection (1), the Minister may invite, orally or in writing, the applicant for a visa to give additional information in a specified way." McHugh Callinan The Tribunal's duty to allow the appellant to give evidence and present argument Although the Tribunal was obliged to provide an informal mechanism of review (s 420(1)), and although the Tribunal was not bound by "technicalities, legal forms or rules of evidence" (s 420(2)(a)), the Act established important requirements of a substantive kind, several of which were designed to ensure that applicants for review received procedural fairness. The duty of the Tribunal under s 414(1) to review the delegate's decision (which arose once the appellant had applied for review) continued until one of the outcomes described in s 415(2) was arrived at, for example, the affirming, the varying or the setting aside of the decision. One aspect of the overall duty to review was the duty to invite the appellant to give evidence and present arguments: s 425(1). The duty to review therefore entailed a statutory duty to consider the arguments presented and in that way to afford the appellant procedural fairness. That implied that if the Tribunal thought that the arguments had been presented so inadequately that the review could not be completed until further steps had been directed and performed, it could not be peremptorily concluded by the making of a decision before that direction was complied with or withdrawn. What happened on 5 February 2002? In the absence of access either to the recording or to a transcript, it is not easy for this Court to appreciate the detail of everything that happened on 5 February 2002. However, some key events appear to be clear. The questioning of the Tribunal member was detailed. It was based on a thorough examination of the written materials available to her, both the material supplied by the appellant and the "country information" obtained from the Department of Foreign Affairs and Trade. She appeared to have considerable familiarity with these materials. Her questioning revealed various apparent contradictions in the appellant's position, and caused him to alter that position from time to time. The difficulties to which the questioning directed attention were described, and to some extent highlighted, in the Tribunal's reasons for decision. After the point at which the Tribunal member's summary of her questioning appears in her reasons for decision, she recorded a statement by the appellant that "the fact of the matter is that he is confused by certain dates but that he has been telling the truth." The Tribunal member then recorded that the "adviser stated that he had some concerns with some of the interpreting." McHugh Callinan Inferences from the events of 5 February 2002 There are some inferences which may reasonably be drawn from the Tribunal member's final statements when they are set against the background recorded in her reasons for decision. One is that she regarded the appellant's evidence about the detentions as having potential significance in the review. Another is that she had formed the belief that, despite her detailed questioning, the appellant had not done himself justice in circumstances where he had twice said he was confused and where doubts about interpretation had arisen – perhaps because he had not fully understood the questions which she had put to him, perhaps because in the stress of the moment he had not been able fully to communicate appropriate answers to them, perhaps because of the difficulty in assessing the credibility of evidence given through an interpreter. A third inference is that she believed that, as a result, the procedure had not been satisfactory because it had not been wholly fair to the appellant. In consequence, she thought that the process of review – so far as the appellant was to participate in it – should not be brought to a close, and that it was appropriate to hear more from him about the detentions. It can also be inferred that she had decided that a fair technique by which to take the matter forward was for the difficulties arising from the apparent inconsistencies to be explained to the appellant in written questions to be formulated by her, and to be calmly answered by the appellant in less stressful conditions. The case, then, is an unusual one. In her closing remarks on 5 February 2002, the Tribunal member was herself acknowledging that the purposes of the review had not been completely fulfilled by the documents supplied before 5 February 2002 or by the events of 5 February 2002. She was indicating that she had not yet finished receiving the presentation of arguments by the appellant which he had been invited to make, pursuant to s 425(1) of the Act, by the letter of 13 December 2001. She was saying that procedural fairness required some further steps to be taken, so that the matters indicated could be ironed out one way or the other. It is clear that the Tribunal member was in the best position to judge whether the review process was incomplete. Her conduct is only consistent with the formation of a firm impression that it was. It is possible that the reason why the Tribunal member failed to send the promised questions was that, on reflection, she thought that everything she required had in fact already been put before her, or that a resolution of the perceived inconsistencies in the appellant's statements was not crucial in deciding the review against him. If either of these explanations, or any other explanation, existed, it is to be expected that the Tribunal member would have advanced it, either by a letter to the appellant or in her detailed reasons for decision. She did not do so. It is probable, when the workload under which the Tribunal labours is McHugh Callinan borne in mind, that the Tribunal member did not send the promised questions because she had forgotten or overlooked the fact that she had made the promise to send them. Her failure to give any indication otherwise suggested that her original impression that the review process was incomplete had not altered on reflection, and was soundly based. It would not be complete until the steps which she had thought could remedy its defects had been carried out. The failure to complete the review process was a failure to comply with the duty imposed by s 414(1) to conduct the review and the duty under s 425(1) to hear from the appellant. Whatever the source of power to do what was done, its existence, in the context of the other powers listed in Pt 7 Divs 2-7A of the Act, suggests that its exercise was a serious matter. Thus the course contemplated by its exercise in the manner in which it was exercised in the present case, once embarked on, was not lightly to be departed from. There was no provision permitting the making of a decision affirming the delegate's decision, and the handing down of reasons for that decision, before the course contemplated was complete. Hence whether the Tribunal member was relying on s 427(1)(b) or s 415(1) read with s 56, that part of the process of review which involved participation by the appellant, as provided for in s 425(1), had not been concluded. The entitlement of the appellant to complain about the failure of the Tribunal to complete the review process does not depend on the tender of evidence that he was misled or prejudiced. It is true that in some cases it may be necessary for disappointed applicants for review to file evidence about what steps they would have taken if the alleged breach of procedural fairness had not occurred. But the failure of the present appellant to file evidence about what he would have done had the Tribunal member's promise been fulfilled is not fatal to the appeal for at least one reason specific to the present case. While the appellant knew that the foreshadowed questions would relate to inconsistencies in what he had said about the detentions, it would not have been possible for him to file an affidavit stating what answers he would have given to particular questions without knowing what the questions would have been. He could not anticipate what material he would be asked to supply, nor could he anticipate how any particular material to be requested would relate to the potential lines of reasoning of the Tribunal member, and hence he could not anticipate what he might usefully say on the subject generally. Did the detention question become immaterial? The Minister argued that there had been no material breach of a duty to give procedural fairness because the controversies about the number of detentions, and the internal inconsistencies in what the appellant said about them, McHugh Callinan were not crucial to the reasoning process employed by the Tribunal member. The Minister argued that the appellant's evidence about the Jihad Movement and Dawood Ibrahim's movement was rejected because of its inconsistency with "independent evidence", not because of its internal inconsistencies. The Minister also argued that the appellant's contention that membership of the Muslim League placed him at risk of persecution was rejected partly because of the appellant's evidence about the other movements and partly because of independent evidence that the Muslim League was a legal and moderate party. According to the Minister, where the Tribunal member had not referred to a factual matter such as self-contradiction (and in particular self-contradiction about the number and duration of the periods of detention), it indicated that the Tribunal member had decided that the point was immaterial. Finally, the Minister argued that the Tribunal member had found that even if the appellant did have difficulties in India, they were local only, and could be avoided by relocation: to that issue, self-contradiction about detention was irrelevant. To some extent these submissions fail in their own terms. To some extent they fail because they take no account of matters which probably underlay the Tribunal member's thinking when she made her closing statements on 5 February The submissions depend on a reading of the reasons for decision as turning only on the independent information, not the implausibility in the appellant's claims arising from self-contradiction. The courts have often warned against excessively fine scrutiny of the language of executive bodies and administrative tribunals, and the reading advanced by the Minister is certainly unduly close and confined. The reasons for decision, under the heading "FINDINGS AND REASONS", contain language suggesting that the Tribunal member was not relying only on contradiction of the appellant's evidence by independent information. Thus the Tribunal member said: "The Tribunal has grave doubts about the [appellant's] credibility in regard to his claims to have been involved with Dawood Ibrahim and the Jihad Committee. His claims and evidence in regard to these organisations [are] so far fetched as to be fanciful, and moreover, his claims and evidence are inconsistent with independent evidence." Here the Tribunal member advanced two distinct reasons for her grave doubts about the appellant's claims in evidence: their far-fetched and fanciful character, and their inconsistency with independent information. In the context of the review under consideration, one reason for concluding that the appellant's McHugh Callinan evidence was "so far fetched as to be fanciful" was its self-contradictory character. The Tribunal member also said: "There are notable inconsistencies between the [appellant's] claims and evidence on the one hand, and the independent evidence on the other. The Tribunal gives weight to the independent evidence over and above that of the [appellant]. In light of these inconsistencies, and further, in light of the significant implausibility in his claims surrounding his involvement with the Dawood Ibrahim Movement, the Tribunal cannot be satisfied [that] the [appellant] has ever been involved with Dawood Ibrahim and gives this claim no weight."7 Here the Tribunal member again advanced two reasons for not giving the appellant's specific claim to have been involved with Dawood Ibrahim any weight: information, and "significant independent implausibility". Again, one clear reason for the implausibility of the claim was its self-contradictory character. inconsistencies with While the "far fetched", "fanciful" or "implausible" character of the appellant's claims of involvement with Dawood Ibrahim were not explicitly linked by the Tribunal member to the appellant's self-contradictions about his detention, the material dealt with by the Tribunal under the heading "FINDINGS AND REASONS" set out above must be considered in context. When it is read as a whole in the light of the Tribunal member's summary of her questioning and the appellant's answers, it is clear that her scepticism about particular parts of the appellant's evidence existed to some extent because of her scepticism about other parts of it. The tone in which the Tribunal member recorded the evidence of the appellant, and identified internal inconsistencies in it, reveals that she was troubled not only by the fact that it was contradicted by "independent information" but also by the fact that several parts of it were internally contradictory, including the parts dealing with the detentions. The number and duration of the occasions on which the appellant was detained were matters that were peculiarly within the appellant's knowledge and on which the independent information cast no light. If he were disbelieved on those matters, the chances of him being disbelieved on other matters were greatly increased. 7 Emphasis in original. McHugh Callinan The concluding remarks of the Tribunal member on 5 February 2002 reveal that she thought the appellant's cause might be retrieved or at least aided by an explanation of the inconsistencies about his detention. At that stage she must have thought that it was not possible fairly to conclude the review adversely to the appellant merely by resort to independent information, or by saying that his difficulties could be overcome by internal relocation. She might have thought, for example, that if the appellant clarified his account of the detentions, he could have restored his credibility on other questions – difficult though the independent information might have made that task – and that if he had done so, the relocation reasoning would not have prevailed. If the appellant's answers to the written questions about detention caused his general credibility to improve, his evidence about Dawood Ibrahim might have been accepted. As the Minister conceded, the independent information did not suggest that the concern of the Indian authorities about Dawood Ibrahim made the appellant's problems in that regard only local ones, curable by moving to another part of India – Dawood Ibrahim was of concern to the national authorities, and anyone closely connected with his movement would have been of concern to them as well. At times the Minister's argument appeared to assume that once independent information exists, no contrary evidence from an applicant, however intrinsically credible, can be accepted. That assumption overlooks the fact that independent information can sometimes be vague, fluid or out of date, and that acceptance of a witness on some points can assist in reaching a conclusion that the witness is acceptable on others as well. While the fact that the Tribunal member made no finding on a matter may indicate that she did not consider it to be material, it does not follow that she must have considered it to be immaterial. The Tribunal member at one important stage had the impression that there might be a benefit for the appellant in the review as a whole in having a further opportunity to answer her questions in writing on the subject of detention; she never explained why that impression was wrong or whether it had changed; it is thus a likely inference that the impression was sound. Hence the appellant's deprivation by the Tribunal member of that opportunity is a breach of procedural fairness going to jurisdiction. In view of this conclusion, it is unnecessary to consider a dispute between the parties as to whether a failure to accord procedural fairness in relation to an immaterial part of the relevant proceedings is a breach of procedural fairness at all, and, if it is, whether the Court's discretion to refuse relief under the constitutional writs should be exercised unfavourably to the appellant. McHugh Callinan Construction of the Tribunal member's final words There was a dispute below and in this Court about whether the Tribunal member's final statement on 5 February 2002 meant that she was giving an opportunity to the appellant only to answer her questions about detention and to put any further information relevant to those questions before her, or whether she was in addition giving him an opportunity to put any further information on any relevant subject. It is not necessary to resolve that dispute, since even if her final statement bore only the former meaning, the appellant would have been deprived of procedural fairness for the reasons given above. But there is force in the opinion of Downes J, in dissent in the Full Court, that the final statement should be construed expansively in favour of the appellant8. Further, it is difficult to see what work the words "and to put any more information that you wish to the Tribunal" did, unless they conveyed a promise that the appellant would not be limited to conveying information responsive to the Tribunal's questions but would be permitted to put "more information" as well on any relevant subject. Orders The judgment of the Full Court of the Federal Court of Australia, dismissing with costs the appellant's appeal from Tamberlin J's order dismissing his application to the Federal Court with costs, should be set aside. In lieu thereof, there should be an order upholding the appeal to the Full Court and setting aside the order of Tamberlin J. There should be an order absolute for a writ of certiorari directed to the second respondent, quashing the decision of the second respondent in matter N00/32904 dated 22 February 2002 and handed down on 19 March 2002. There should also be an order absolute for a writ of mandamus directed to the second respondent requiring it to determine the application made to it for review of the decision of a delegate of the first respondent dated 15 March 2000 according to law. The first respondent should be ordered to pay the appellant's costs of the proceedings in the Federal Court of Australia before Tamberlin J, in the Full Federal Court, and in this Court. 8 NAFF of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs (2003) 127 FCR 259 at 273 [60]. Kirby KIRBY J. This appeal comes from a judgment that followed a split decision of the Full Court of the Federal Court of Australia9. By majority, that Court declined to disturb the orders of the primary judge (Tamberlin J)10 who, in turn, had refused relief under s 39B of the Judiciary Act 1903 (Cth) ("the Judiciary Act") directed to the Refugee Review Tribunal ("the Tribunal"). The Tribunal had affirmed the decision of the delegate of the Minister refusing NAFF ("the appellant") a protection visa under the Migration Act 1958 (Cth) ("the Act")11. In the Federal Court, and in this Court, the only issue that remains alive is the appellant's complaint that the Tribunal failed to accord him procedural fairness. That complaint arises from statements made at the end of the hearing in the Tribunal in which it was agreed that the Tribunal member said12: Given that there are some inconsistencies with regard "TRIBUNAL: to the dates of the detentions and the number of detentions, I will have to write to you about those (interpreted). TRIBUNAL: So what I will do is to write to you in the next couple of days and you will have 21 days in which to respond to my questions and to put any more information that you wish to the Tribunal." The Tribunal did not write to the appellant. Nor did it otherwise contact him or his agent about the "inconsistencies" referred to, or anything else. Without having done so, it delivered a comprehensive decision adverse to the appellant's claim to refugee status. The appellant's complaint that this procedure was fundamentally unfair and a breach of the requirements of procedural fairness applicable to the Tribunal's hearing13 was rejected by the Federal Court. By special leave, the appellant now appeals to this Court. 9 NAFF of 2002 v Minister for Immigration and Multicultural and Indigenous Affairs (2003) 127 FCR 259. 10 NAFF v Minister for Immigration and Multicultural and Indigenous Affairs [2002] FCA 946. 11 The Act, s 36, giving effect to the Convention relating to the Status of Refugees done at Geneva on 28 July 1951, [1954] Australian Treaty Series No 5; Protocol relating to the Status of Refugees done at New York on 31 January 1967, [1973] Australian Treaty Series No 37. 12 NAFF (2003) 127 FCR 259 at 265 [22], 270-271 [49]-[52]. 13 Re Minister for Immigration and Multicultural Affairs; Ex parte Miah (2001) 206 CLR 57. Kirby Substantially, the appellant supported the dissenting reasons of Downes J in the Full Court. His Honour considered that the Tribunal's closing words were not to be given a narrow interpretation14. He said that they effectively constituted an undertaking, relevant to the outcome of the hearing, that should have been observed. The failure to do so was a departure from the requirements of procedural fairness. It required a fresh hearing of the appellant's claim before the Tribunal. The approach of the dissenting judge was correct. The appellant is entitled to the amended relief that he claimed15. The appeal should be allowed. The facts and applicable legislation The reasons of McHugh, Gummow, Callinan and Heydon JJ ("the joint reasons") set out the history and nature of the proceedings; the relevant provisions of the Act governing the hearing before the Tribunal; and the decisional background of the attempts to secure judicial review from the Federal Court. I will not repeat any of these matters. No question arises concerning the privative provisions of the Act, having regard to the character of the appellant's complaint against the Tribunal, which was one of jurisdictional error, as that Since the appellant's application to the Tribunal was lodged, in April 2000, the Act has been amended in terms apparently intended to exclude the residual operation of the common law requirements of "natural justice" (procedural fairness). The amendments state that the specified provisions of the Act are an "exhaustive statement of the requirements of the natural justice hearing rule"17. However, that provision commenced operation on 4 July 2002, and so does not apply to this application. The appeal must be decided in terms of the requirements of the general law of procedural fairness, either as that law was implicitly incorporated in the 14 NAFF (2003) 127 FCR 259 at 272-273 [60]. See also reasons of McHugh, Gummow, Callinan and Heydon JJ at [45]. 15 The relief claimed in this Court was amended to take into account the fact that the proceedings were brought under the Judiciary Act, s 39B and invoked the constitutional writ of mandamus and the supplementary writ of certiorari. The Tribunal was, by order of the Court, added as a party to the proceedings and submitted to this Court's orders. 16 Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476 at 508 [83]. 17 The Act, s 422B, inserted by Migration Legislation Amendment (Procedural Fairness) Act 2002 (Cth), Sched 1, item 6. Kirby Act before s 422B took effect or as it applies as a rule of the common law that had not, to that time, been abolished or diminished by statute18. That provision is expressed in mandatory terms, obliging the Tribunal to invite the applicant for review to appear before the Tribunal "to give evidence and present arguments relating to the issues arising in relation to the decision under review". Certainly, the Tribunal did invite the appellant to appear. The appellant gave evidence and presented arguments relating to issues arising in the review. The question, expressed in statutory terms, is therefore whether, in the procedure which the Tribunal followed, including the statements made at the end of the hearing, it fulfilled the requirements of s 425 of the Act as envisaged by the Parliament. The issues Appellant's complaint of procedural unfairness: The issues raised by the arguments of the parties before this Court require that chief attention be paid to submissions made on behalf of the Minister for Immigration and Multicultural and Indigenous Affairs ("the Minister"). On the face of things, in the light of the statement made to the appellant by the Tribunal, and the failure to fulfil the intended action foreshadowed there, the course of the proceedings involving the appellant was unfair. At the end of the proceedings, the appellant had pronounced himself confused over questions addressed to him by the Tribunal member concerning dates and events affecting the foundation of his claim for a protection visa. Certain difficulties had arisen from the use by the Tribunal of a Tamil-speaking national of Sri Lanka as the interpreter. It seems that the Tamil language in Sri Lanka may contain some differences from that spoken in the part of India from which the appellant derived. The appellant's agent expressed concern over this. The Tribunal member, by her statements, acknowledged "some inconsistencies" and, at least at the closing stage of the hearing, foreshadowed a legally unnecessary and unusual course of writing to the appellant about the inconsistencies, so as to afford him the opportunity to respond to questions and to put more information before the Tribunal as he wished. When this was not done, and the subsequent decision proved adverse, the claim of procedural unfairness became virtually inevitable. 18 See Kioa v West (1985) 159 CLR 550 at 584-586, 615; Haoucher v Minister for Immigration and Ethnic Affairs (1990) 169 CLR 648 at 652; Abebe v The Commonwealth (1999) 197 CLR 510 at 553-554 [112]-[113]; Re Refugee Review Tribunal; Ex parte Aala (2000) 204 CLR 82 at 99-101 [38]-[42], 142-143 [168]- [169]; Miah (2001) 206 CLR 57 at 108-109 [171]-[172]. Kirby The appellant did not suggest that the course adopted by the Tribunal was one of deliberate unfairness or a wilful endeavour to mislead him, to prevent him from dealing with an issue or to stop him saying something that might have persuaded the Tribunal to reach a different conclusion. Instead, the appellant was prepared to accept that, for whatever reason, the Tribunal had forgotten or overlooked its indication that it would write to him and afford him the opportunity to deal with outstanding concerns about inconsistencies. However that may be, the failure to do so represented a procedural injustice because the "inconsistencies" remained relevant. They proved important to the outcome. They should have been followed up as the Tribunal had indicated. The failure to do so involves procedural unfairness. Minister's arguments and issues: The Minister nevertheless denied that the statement of the Tribunal member gave rise to relief. The Minister's arguments presented the real issues to be determined in the appeal. They were: The no-obligation issue: That the Tribunal had no legal obligation to follow up the hearing with written questions, that the Tribunal member's statements were superfluous to the lawful completion of the hearing and did not alter the fact that such completion in accordance with the Act had occurred; The legitimate expectation issue: That in so far as the appellant's arguments were based upon a suggested foundation grounded in the contention that he had a "legitimate expectation", as a result of the Tribunal member's closing comments, that he would be given an opportunity to respond to concerns over inconsistencies in the evidence, any such departure from his "expectations" was of no legal consequence following the decision of this Court in Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Lam19; The absence of proof of reliance issue: That it was for the appellant to establish his entitlements before the Tribunal and in the Federal Court. If he contended that, by the course of proceedings that followed the Tribunal member's closing statement, he was denied procedural fairness, the burden was upon him, by relevant evidence available to be tested, to prove the content of the evidence and arguments that he was denied the opportunity of presenting. In default of such proof, a court should not draw an inference that there was any substance in the complaint made by the appellant merely from the appellant's bald assertions; 19 (2003) 214 CLR 1. Kirby The irrelevance of the inconsistencies issue: That, in the event, the Tribunal had been able to resolve the merits of the appellant's application for review, as it was entitled to do under the Act, without reliance upon particular "inconsistencies" with regard to the dates of the detentions and the number of detentions, being the only "inconsistencies" about which the Tribunal had indicated that it would write to the appellant. Therefore, any defect in the fulfilment of the Tribunal's indication that it would write to the appellant was ultimately irrelevant to the outcome of the proceedings. Accordingly, no substantive unfairness occurred in the result; The factual merits issue: That the Tribunal's decision was an extremely detailed, painstaking and careful one indicating, upon numerous grounds, the unsatisfactory character of the appellant's evidence sustaining the Tribunal's conclusion that his claim was far-fetched and inconsistent with the other evidence before the Tribunal. Weighed against the disclosed merits of the claim, the suggested procedural unfairness arising from the closing words of the Tribunal member was inconsequential. It lent no ultimate support to the complaint that the hearing had failed because flawed by jurisdictional error; The over-statement of approach issue: That the judge in the minority in the Full Court (Downes J) had adopted an incorrect approach in so far as he suggested that undertakings such as those made by the Tribunal to the appellant "should always be strictly observed … ideally … recorded in a document, and … couched in careful terms"20. The only basis that would warrant judicial intervention would be where conduct amounted to a denial of procedural fairness that would otherwise call for relief from the courts21; and The discretionary refusal of relief issue: That, even if some technical slip was demonstrated in the course which the Tribunal had followed, substantively it had completed its hearing as contemplated by the Act. It fully justified its conclusion adverse to the appellant. Relief in the form of the constitutional writs, and the supplementary writ of certiorari to make such writs effective, should be denied as the provision of such relief was discretionary, not as of right22. 20 NAFF (2003) 127 FCR 259 at 273 [60]. 21 See Lam (2003) 214 CLR 1 at 9 [25], 48 [149]. 22 Aala (2000) 204 CLR 82 at 136-137 [145]-[150]. Kirby In my view, none of the foregoing issues should be resolved in favour of the Minister. The appellant is entitled to relief. The no-obligation argument is not determinative It may be accepted that the Tribunal had no obligation under the Act, or otherwise, to say what was said at the conclusion of the hearing. So much is acknowledged for the appellant. It may also be accepted that if the Tribunal had said nothing about writing to the appellant (but had privately contemplated doing so but later overlooked that thought or determined that it was not necessary) no ground for relief could arise. The Minister argued that the appellant had been afforded a full chance to put his case. He and his agent must have anticipated the necessity of clarifying the circumstances of his alleged detentions. So much was shown by the extensive oral and documentary submissions addressed to the Tribunal by the agent on that issue. However, the words used by the Tribunal member cannot be expunged from the agreed record. Applications for judicial review are commonly based on the record. The fact that the words need not have been said is immaterial. They exist on the record and were available to the appellant in endeavouring to construct his case of procedural unfairness. Judicial review cases of this kind normally involve scrutiny of what is said and done in the court or tribunal the subject of the proceedings. For example, the record may show that a party was not given a distinct opportunity to address on penalty before the decision-maker proceeded to a conclusion23. Or the decision- maker may have proceeded to an order without hearing evidence and submissions at an adjourned hearing24. In such cases, the issue of supposed procedural unfairness is determined on the facts as they are proved from the record or otherwise. It is not determined, as such, merely from the powers of the decision-maker or what that person might have done if acting fairly. Nor is it to the point to complain that the Tribunal did not prevent the appellant from saying anything he wished or from volunteering additional matter after the hearing, addressed to the inconsistencies that had emerged to which the Tribunal member had referred. Prevention or obstruction or deception was not the way the appellant argued his case. The fact that the Tribunal had powers to act in a different way is also immaterial. So is any suggestion that to hold the Tribunal to the closing words of the member would discourage the Tribunal, where it would otherwise be relevant to do so, from following up its concerns 23 See Hall v NSW Trotting Club Ltd [1977] 1 NSWLR 378 at 388 per Samuels JA. 24 See Sullivan v Department of Transport (1978) 20 ALR 323 at 343. Kirby with requests in writing. There was nothing wrong in the Tribunal's action in signalling that intention. Nor should it be discouraged from doing so where there are residual doubts25. The error of the Tribunal was proceeding to a decision without either writing to the appellant as stated or, at the least, informing him in advance of the decision that such a course was no longer considered necessary or intended26. Had that been done, the appellant would at least have known where he stood. As it was, when the date of the Tribunal's decision was notified, the appellant was entitled to conclude that the decision would be favourable to him (and needed no further submissions) because the Tribunal member had not felt it necessary to elucidate the "inconsistencies" to which she had referred at the end of the hearing. There is therefore no substance in the Minister's first argument. The legitimate expectation argument is immaterial Nor is this a case in which to explore the notion of legitimate expectations in Australian legal doctrine and to what extent it continues to play a part in resolving instances of procedural unfairness. Talk of "expectation" in this context has been criticised as a legal fiction27. However, in this area of legal discourse, fictions abound. They are used as a means to assist judges to explain what the law requires in a particular case. Thus, in connection with the bias rule, it is common for courts to invoke the fiction of the reasonable observer, in assessing the impugned action (or neglect of action) on the part of the decision-maker28. That is essentially how the notion of "legitimate expectation" came to be used in cases of alleged procedural unfairness. In effect, the phrase usually meant nothing more than that a reasonable person, in the position of the applicant for relief, would have expected something to occur or not to occur, having regard to all of the circumstances. The failure to meet such expectations was a way of explaining why the omission constituted procedural unfairness: why it amounted to a departure from what would otherwise have been "the natural course of events"29. 25 Mahon v Air New Zealand Ltd [1984] AC 808 at 820-821; National Companies and Securities Commission v News Corporation Ltd (1984) 156 CLR 296 at 314- 26 See joint reasons at [32]. 27 Minister for Immigration and Ethnic Affairs v Teoh (1995) 183 CLR 273 at 310- 28 See eg Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337. 29 R v Muir; Ex parte Joyce [1980] Qd R 567 at 578. Kirby There are various arguments against the use of this fiction, just as there are of other fictions well beloved of lawyers − such as the one that seeks to explain questions of statutory interpretation in terms of the "intention" of Parliament. There is nothing in this Court's decision in Lam that obliges abandonment of reference to "legitimate expectations" as a tool of judicial reasoning30. However, given the expanded notion of procedural fairness in Australia31 I accept that the utility of this particular fiction is now somewhat limited32. If the law requires a particular course to be followed, such as was the case in the present proceedings, the true legal issue is not, or is not only, whether the person adversely affected by a decision has had his or her legitimate expectations disappointed. That may be a consequence of the departure from the legal standard; but it is not the invalidating cause. The failure to observe proper procedures itself amounts to a legal defect in the performance of the task conferred by law as the law requires. In this sense, the invalidating element is not the disappointment but the anterior failure to conform to the law. That failure is, in a sense, a legal wrong against the whole community. The duty to accord procedural fairness is part of the public law. It is upheld to ensure that the element of governance contemplated by law will (absent lawful exceptions) be discharged fairly. In the end, the Minister's arguments addressed to supposed issues of legitimate expectation represented a distraction in this case. The remarks of Gleeson CJ in Lam33, on the way in which a specific representation can give rise to an expectation34, are nonetheless worth recalling. They have direct application to the facts of this case: "[I]t is clear that the content of the requirements of fairness may be affected by what is said or done during the process of decision-making, including and by developments the course of that process, 30 Thus Gleeson CJ in Lam accepted that in some circumstances a representation to a party might generate a legitimate expectation. See Lam (2003) 214 CLR 1 at 11-12 31 Kioa (1985) 159 CLR 550; Annetts v McCann (1990) 170 CLR 596 at 598; Ainsworth v Criminal Justice Commission (1992) 175 CLR 564 at 576. 32 A point made in Lam (2003) 214 CLR 1 at 16 [47], 27-28 [81]-[83] per McHugh and Gummow JJ, 45-46 [140] per Callinan J. 33 (2003) 214 CLR 1 at 12-13 [34]-[35]. 34 See Attorney-General (Hong Kong) v Ng Yuen Shiu [1983] 2 AC 629. Kirby representations made as to the procedure to be followed. So, for example, if a decision-maker informs a person affected that he or she will hear further argument upon a certain point, and then delivers a decision without doing so, it may be easy to demonstrate that unfairness is involved. But what must be demonstrated is unfairness, not merely departure from a representation. Not every departure from a stated intention necessarily involves unfairness, even if it defeats an expectation." It follows that there is no substance in the Minister's second argument. The absence of evidence is not determinative The passage from Lam shows that it is not sufficient for the appellant in this case to prove the "representation" made by the Tribunal member at the end of the hearing. It remains for the appellant to show that he has suffered a relevant unfairness. The Minister submitted that the omission of the appellant to prove precisely what evidence or submissions he would have addressed to the Tribunal, had it followed up the hearing with specific questions on the inconsistencies mentioned, was fatal. Certainly, in proceedings by way of judicial review (as distinct from certain proceedings by way of appeal35), it will usually be open to a person complaining to tender evidence of what would have been done, or done differently, if the hypothesised course had been taken36. But can it be said that this is a universal rule? Or that Downes J, in the Full Court, erred in referring as he did to the appellant's attempt to foreshadow, in an unsworn ground of appeal, the matters that he would have dealt with had the Tribunal given him the opportunity to make a follow-up submission37? The Minister criticised the use of the ground of appeal as reliance by Downes J on "untested assertions". However, such criticism is unconvincing in this case. It is not a universal rule that a party, seeking judicial review for alleged departure from the requirements of procedural fairness, must always prove, as a price of relief, what that party would have done had the procedural defect not occurred. It is in the nature of the failure of the Tribunal to follow up the stated 35 eg in the High Court of Australia: Eastman v The Queen (2000) 203 CLR 1 at 13 36 Aala (2000) 204 CLR 82 at 88 [3], 113-114 [70], 122 [103], 130 [128], 144 [172], 150 [200], 153-154 [211]. See also Re Minister for Immigration and Multicultural Affairs; Ex parte Applicant S154/2002 (2003) 77 ALJR 1909 at 1910 [1], 1914 [29]; 201 ALR 437 at 438, 444. 37 NAFF (2003) 127 FCR 259 at 270 [50]. Kirby "inconsistencies", with questions of the kind foreshadowed, that the appellant was left in the dark as to the precise matters that caused the Tribunal to foreshadow such a course. The existence of such concerns was sufficiently indicated by the proposal of an exceptional post-hearing communication as was mentioned. Before the decision was published, the appellant was uninformed of the Tribunal's exact concerns. After the decision became known, the appellant's task was to overcome the legal barrier which the decision presented. Only if that barrier could be overcome would any detailed response of the appellant be legally material. In some cases, where it is clear that a simple mistake or misunderstanding has occurred, the tender of corrective evidence, supported by well-focused arguments, will be a sensible course to adopt38. In most cases, it may be expected that the applicant for relief will be able to show, at least in a general way, what material would have been placed before the decision-maker if the opportunity had been given39. However, in a case such as the present, where the evidence was wide-ranging and the points of inconsistency and difficulty numerous and diffuse, the absence of detailed supplementary evidence from the appellant could not be regarded as fatal to judicial review. It was not the function of the Federal Court on judicial review (still less of this Court) to retry the merits of the appellant's application. It was sufficient for the appellant, in the circumstances, to establish that a procedural default had occurred which was not immaterial but might have affected the outcome of the proceedings before the Tribunal. This the appellant sufficiently did. The third argument also fails. The inconsistencies were not irrelevant to the outcome Nor is it persuasive to suggest, as the Minister did, that the point of unfairness of which the appellant complains was, in the result, irrelevant to the Tribunal's actual conclusion. The fundamental principle to be applied by the Federal Court was that "a person whose interests are likely to be affected by an exercise of power must be given an opportunity to deal with relevant matters adverse to his or her interests that the repository of the power proposes to take into account in deciding upon its exercise"40. This principle was not in dispute. Did the Tribunal comply with it in the circumstances of this case? 38 See Aala (2000) 204 CLR 82 at 130 [128]. 39 Re Minister for Immigration and Multicultural Affairs; Ex parte "A" (2001) 185 ALR 489 at 501 [54]. 40 Miah (2001) 206 CLR 57 at 96 [140], citing Kioa (1985) 159 CLR 550 at 628 per Kirby The Minister suggested that, by an analysis of the way in which, in its reasons, the Tribunal had resolved the claim adversely to the appellant, it was clear that particular inconsistencies with regard to the dates of the appellant's detentions and the number of detentions ultimately played no part in the outcome. Accordingly, so it was said, the failure to follow up any residual uncertainty about those matters was inconsequential. It did not affect the outcome. Thus it did not amount to a breach of the requirements of procedural fairness. This submission fails for two reasons. First, the rejection of the appellant's claim by the Tribunal was clearly affected by the Tribunal's assessment of the appellant's credibility. At various points in its reasons, the Tribunal indicated its scepticism concerning the appellant's evidence on a number of issues including his procurement of a passport to depart from India; the suggested difficulty of relocation within India; and his personal involvement in the Moslem League and other Islamic activities within India41. To put the matter beyond doubt, the applicant's credibility specifically. It did so in an extended passage in its decision42 which concluded that his "claims and evidence in regard to these organisations is so far fetched as to be fanciful"43. the Tribunal addressed There is also an express reference to inconsistencies in respect of the appellant's involvement in an identified organisation. It was "in light of these inconsistencies"44 and the suggested implausibility of the appellant's claims that the Tribunal concluded that it could give such claims "no weight"45. In a case in which credibility and inconsistencies were so obviously important, it cannot be said that the opportunity to clear up particular "inconsistencies", identified by the Tribunal at the end of the hearing, was immaterial to the eventual outcome of the hearing. Secondly, and in any case, decision-making is a complex mental process. Disbelief of a litigant or witness on one point might carry over to affect the 41 Refugee Review Tribunal, Reference N00/32904, 19 March 2002 ("RRT decision") 42 RRT decision at 14-15. 43 RRT decision at 15. 44 RRT decision at 15. 45 RRT decision at 16 (emphasis in original). Kirby decision-maker's disbelief of the same person on other points46. Contrary-wise, establishing that an initial disbelief of a person's credibility on one matter was erroneous might convince a decision-maker of the need to revisit other conclusions and to look at the person's entire evidence in a new light. When these considerations are taken into account, it cannot be said that the omission to afford the appellant the opportunity foreshadowed at the end of the hearing was immaterial to its outcome having regard to the terms in which that outcome is expressed. The Minister's fourth argument also fails. The merits arguments do not cure procedural error On similar grounds, the submission that the decision of the Tribunal was strongly reasoned in a way that overwhelmed the procedural default complained of is unpersuasive in this case. Fair and lawful procedures are upheld by the courts for their own sake, not just for their consequences47. This is because of the experience of the common law that, out of fair and lawful procedures, fair and lawful outcomes will more commonly emerge. It is not the function of judicial review to retry the merits or, as such, to re- assess the merits of the case and excuse an established departure from fair procedures because the merits seem strongly one way. If the departure from procedural fairness might have affected the outcome, the function of judicial review is to say so. Subject to the consideration of any residual discretion to deny relief, the courts will set aside the flawed decision. This is because, in the eye of the law, it is not a "decision" as contemplated by law48. Every person, in respect of whom material decisions are made by a repository of public power conferred by the Parliament, is ordinarily entitled to have such power exercised in accordance with law. That includes, relevantly to this case, in accordance with the requirements of procedural fairness. The ultimate outcome of such insistence on fair procedures might eventually be the same. But where the issue is whether additional evidence and submissions might have affected the outcome of the decision-maker's consideration of the matter, it 46 Kioa (1985) 159 CLR 550 at 629 per Brennan J. 47 Bayles, Procedural Justice: Allocating to Individuals, (1990) at 127-135; Galligan, Due Process and Fair Procedures: A Study of Administrative Procedures, (1996) 48 Plaintiff S157 (2003) 211 CLR 476 at 506 [76]. See also Darling Casino Ltd v NSW Casino Control Authority (1997) 191 CLR 602 at 635. Kirby cannot normally be said with certainty that affording such an opportunity was futile. That is why, in Re Refugee Review Tribunal; Ex parte Aala49, in the context of judicial review, this Court affirmed the strong principle earlier stated in Stead v State Government Insurance Commission50. In Stead, the test applied to deny relief for established procedural unfairness was whether the Court could say that a properly conducted hearing "could not possibly have produced a different result"51. A similar approach was adopted in Aala by all members of the Court52. Gleeson CJ explained why this was so in words applicable to the present case53: "It is possible that, even if the prosecutor had been given an opportunity to deal with the point, the Tribunal's ultimate conclusion would have been the same. But no one can be sure of that. Decisions as to credibility are often based upon matters of impression, and an unfavourable view taken upon an otherwise minor issue may be decisive." The Minister's fifth argument therefore fails. The minority's reasoning about the approach is immaterial The Minister's complaint concerning the suggestion of Downes J that procedural fairness "requires that [assurances of follow-up will] be given an expansive and not a confined construction"54 is insubstantial. So is the objection to his Honour's statement that undertakings, such as those given by the Tribunal to the appellant, "should always be strictly observed"55. 49 (2000) 204 CLR 82. 50 (1986) 161 CLR 141. See also Gerlach v Clifton Bricks Pty Ltd (2002) 209 CLR 478 at 499-500 [57]; Muin v Refugee Review Tribunal (2002) 76 ALJR 966 at 992 [140]; 190 ALR 601 at 635; S154 (2003) 77 ALJR 1909 at 1914 [28]; 201 ALR 51 (1986) 161 CLR 141 at 147; cf John v Rees [1970] Ch 345 at 402. 52 (2000) 204 CLR 82 at 89 [5] per Gleeson CJ, 116-117 [80] per Gaudron and Gummow JJ, 122 [104] per McHugh J, 130-132 [131]-[133] of my own reasons, 144 [172] per Hayne J, 153-155 [211] per Callinan J. 53 (2000) 204 CLR 82 at 89 [4]. 54 NAFF (2003) 127 FCR 259 at 273 [60]. 55 NAFF (2003) 127 FCR 259 at 273 [60]. Kirby These were not separate grounds upon which Downes J favoured upholding the appeal. They were explanations of his Honour's reaction to the statements made by the Tribunal member at the close of the hearing and the omission to follow up those statements in this case. I see no reason to delay over this complaint. The substantial conclusion reached by Downes J was well justified56. I take his Honour to have said nothing more than that, if Tribunal members indicate an intention to follow up a matter of potential importance for their decision, they should either do so or they should inform the person concerned that they do not intend to take that course. To say nothing and then to proceed directly to an adverse conclusion results, as here, in a vitiating instance of procedural unfairness. The sixth argument also fails. The discretion favours the grant of relief Some of the considerations that are relevant to the question whether there has been an instance of procedural unfairness may overlap with the factors relevant to providing, or withholding, relief by way of a constitutional writ on discretionary grounds. A residual discretion exists in the provision of such writs and the other relief contemplated by s 39B of the Judiciary Act57. It is legitimate in such judicial review proceedings to consider withholding relief if the analysis of all relevant matters indicates that the requirements for relief are not established. The residual discretion permits a court to reconsider the matter globally and to review all of the relevant considerations, taken as a whole58. When the present case is examined for this purpose no sufficient ground is established to warrant refusal of relief. None of the arguments advanced by the Minister has that effect. No other or different considerations arise personal to the appellant or connected with such questions as delay and the timeliness of his proceedings59. On the contrary, the provision of relief upholds the commitment, imputed to the Parliament, in terms of the Act as it then stood, that vulnerable people in the position of the appellant will have their cases determined by the Tribunal fairly and as natural justice requires. Thus, the considerations involved in upholding a law designed to give effect to Australia's international obligations; the protection of the human rights 56 See joint reasons at [45]. 57 Ex parte "A" (2001) 185 ALR 489 at 502 [58]. 58 Aala (2000) 204 CLR 82 at 144 [172]. 59 Aala (2000) 204 CLR 82 at 117 [82]-[83], 137 [149]-[150]. Kirby of the appellant; and the maintenance of the due administration of a law enacted by the Parliament all favour the grant of relief. The seventh and final argument of the Minister also fails. Orders As I would reject all of the Minister's arguments and otherwise uphold the appellant's complaint of procedural unfairness, I agree in the orders proposed by the joint reasons.

HIGH COURT OF AUSTRALIA THE QUEEN AND APPLICANT RESPONDENT The Queen v Nguyen [2010] HCA 38 3 November 2010 ORDER Special leave to appeal granted. Special leave to cross-appeal granted. Appeal and cross-appeal each treated as instituted and heard instanter and allowed. Set aside the orders of the Court of Appeal of the Supreme Court of Victoria made in respect of the respondent on 18 December 2009, and, in their place, order that: leave to appeal to that Court against conviction be granted; the appeal to that Court be allowed; the respondent's convictions be quashed; and a new trial be had. On appeal from the Supreme Court of Victoria Representation T Gyorffy with B L Sonnet for the applicant (instructed by Director of Public Prosecutions (Vic)) M J Croucher with C B Boyce for the respondent (instructed by Michael J Gleeson & Associates Pty) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS The Queen v Nguyen Criminal law – Appeal – Verdict unreasonable or cannot be supported having regard to the evidence – Respondent found guilty by jury of murder and attempted murder by complicity – Court of Appeal quashed convictions on ground that verdicts "unsafe and unsatisfactory" in the sense that verdicts were unreasonable or could not be supported having regard to the evidence – Whether verdicts unsafe and unsatisfactory – Whether reasonably open to jury on the whole of the evidence to convict respondent of murder and attempted murder – Task of appellate court. Criminal law – Murder – Practice and procedure – Directions to jury – Whether alternative verdict of manslaughter sufficiently left to jury – Whether reasonably open to jury to return alternative verdict of manslaughter – Whether failure sufficiently to leave alternative verdict to jury constituted a wrong decision on a question of law – Whether no substantial miscarriage of justice actually occurred. Words and phrases – "unsafe and unsatisfactory", "substantial miscarriage of justice". Crimes Act 1958 (Vic), s 568. HAYNE, HEYDON, CRENNAN, KIEFEL AND BELL JJ. In the early hours of 8 November 2004, the respondent (Dang Quang Nguyen), and two other men (Dang Khoa Nguyen and Bill Ho), went to a flat in Carlton, Victoria. The prosecution was later to allege that the three men had gone to the flat to collect a debt owed either to Bill Ho or Dang Khoa Nguyen by a man named Mau Duong. Mau Duong was not at the flat when the three men were there. Seven young people were in the flat. Some were asleep; some were watching television. In the flat, the men repeatedly asked where Mau Duong was. The respondent entered the lounge room of the flat holding a sword. During the events that followed, he waved the sword about, cutting two or three of the flat's occupants. Whether the respondent had brought the sword with him, or found it in the flat, was a matter of controversy at trial. Bill Ho produced a firearm that he had brought with him. He fired two shots. The first hit Chau Minh Nguyen, the other Hieu Trung Luu. Chau Minh Nguyen survived. Hieu Trung Luu died as a result of his wound. Trial, conviction and appeal The respondent was presented with Dang Khoa Nguyen and Bill Ho in the Supreme Court of Victoria on a presentment charging each with the murder of Hieu Trung Luu and the attempted murder of Chau Minh Nguyen. In the trial of the respondent, the central issue was whether the prosecution proved beyond reasonable doubt his complicity in crimes Bill Ho committed against Hieu Trung Luu and Chau Minh Nguyen. The trial, before Williams J and a jury, occupied several weeks in September and October 2007. It was the fourth trial of the accused. The first, in November 2006, ended when all three accused withdrew their instructions to their counsel. The second and third trials proceeded for 10 and 11 days respectively in August and September 2007, but on each occasion the jury were discharged without verdict. On 13 October 2007, the jury at the fourth trial returned verdicts of guilty on both counts against all three accused. The three men were sentenced on 17 December 2007. Within a few days of being sentenced, the respondent gave notice of application for leave to appeal to the Court of Appeal of the Supreme Court of Victoria against his conviction. That application, although made in December 2007, did not come on for hearing until 27 July 2009. It was heard at the same time as an application for leave to appeal against conviction by Dang Khoa Nguyen. In December 2009, two years and one day after the respondent and his co-accused had been sentenced, the Court of Appeal (Neave and Bongiorno JJA, Hayne and Lasry AJA) made orders granting the respondent leave to appeal against his convictions, allowing his appeal, quashing his convictions and directing that judgment and verdicts of acquittal be entered. The appeal by Dang Khoa Nguyen was dismissed. The Court did not publish its reasons for making those orders until 23 February 2010, more than two years after the men had been sentenced, and seven months after the single day taken for the oral argument of the appeals. The reasons of the Court of Appeal were given by Neave JA, the other two members of the Court simply agreeing in her Honour's reasons. The Court of Appeal concluded1 that the verdicts returned by the jury against Dang Quang Nguyen, the present respondent, were unsafe and unsatisfactory in the sense described by this Court in M v The Queen2. More particularly, the Court of Appeal concluded3 that a jury, acting reasonably, must have had a reasonable doubt as to the guilt of the respondent. The Court of Appeal concluded4 that, no matter whether analysed as a case in which the present respondent was alleged to have acted in concert with the others, as a case of extended common purpose, or as a case in which the respondent aided and abetted commission of the crimes alleged, the evidence before the jury did not permit the jury to be satisfied of the guilt of the respondent beyond reasonable doubt. The prosecution now seeks special leave to appeal against the orders of the Court of Appeal. The prosecution submits that, applying well-established principles to the particular facts of this case, it was open to the jury to convict the respondent of both murder and attempted murder. That submission should be accepted. This is one of those exceptional cases5 in which the prosecution should have special leave to appeal against the orders of an intermediate court quashing a conviction by a jury and directing entry of a verdict of acquittal. It is in the interests of justice generally, and in the interests of justice in this particular case, that the error made by the Court of Appeal in this case be corrected. 1 R v Nguyen [2010] VSCA 23. (1994) 181 CLR 487; [1994] HCA 63. [2010] VSCA 23 at [104]. [2010] VSCA 23 at [104]-[112]. 5 R v Hillier (2007) 228 CLR 618 at 640 [53]-[54]; [2007] HCA 13. Hayne Accepting the prosecution's submission that the verdicts of guilty returned against the respondent were not unsafe and unsatisfactory would ordinarily entail that the jury's verdict, and consequential conviction and sentence of the respondent, would stand. The respondent submitted, however, that his application for leave to appeal to the Court of Appeal should have succeeded on a ground alleging misdirection of the jury. He further submitted that, in the particular circumstances of this case, success on that ground should lead either to refusal of the prosecution's application for special leave or dismissal of its appeal, rather than to an order for retrial. The complaint of misdirection was first raised on behalf of the respondent in the course of the hearing of his application for leave to appeal to the Court of Appeal6 and he was given leave to amend his grounds of appeal to that Court accordingly. The complaint, which was also advanced in the application by Dang Khoa Nguyen for leave to appeal to the Court of Appeal, focused upon whether the possibility of returning a verdict of manslaughter instead of murder was sufficiently left to the jury. The Court of Appeal rejected7 those arguments. In this Court, the respondent sought, initially by notice of contention, but later by application for special leave to cross-appeal, to allege that the Court of Appeal should have held that the trial judge misdirected the jury. These reasons will demonstrate that the directions given by the trial judge were erroneous. The respondent should have special leave to cross-appeal, and the cross-appeal should be allowed. What orders should be made in consequence of that conclusion will be considered separately. Attention should be directed first to the prosecution's application for special leave to appeal. That requires some examination of the evidence led at trial. The evidence at trial The prosecution's case at trial was that the three men had gone to the flat to collect a debt owed by Mau Duong for drugs that had been supplied to him by either Bill Ho or Dang Khoa Nguyen. [2010] VSCA 23 at [15]. [2010] VSCA 23 at [141]-[161]. Hayne Mau Duong gave evidence at trial that he was a drug dealer and had been a heroin addict. He said in evidence-in-chief that, about two weeks before the shootings, he had agreed to buy an ounce of heroin from Dang Khoa Nguyen. Mau Duong described how the heroin had been delivered to him, not by Dang Khoa Nguyen but by Bill Ho, and that the arrangement made was that he would pay $4,500 for the drugs after he had sold them. He said he paid for the drugs by first telling Dang Khoa Nguyen that he was ready to pay, and then, presumably by arrangement with Dang Khoa Nguyen, paying the amount owed to Bill Ho. In his evidence-in-chief he said that, a few days before the shootings, he again agreed to buy another ounce of heroin from Dang Khoa Nguyen for $4,500 on credit. Mau Duong arranged with Dang Khoa Nguyen that the heroin would be delivered by Bill Ho to the flat where the shootings were later to occur. Mau Duong collected the heroin from the flat on Friday, 5 November 2004. He did not pay for it then. On Sunday, 7 November 2004, his telephone recorded that a call had been made to it from a number that Mau Duong believed to be Dang Khoa Nguyen's phone. Mau Duong did not speak to Dang Khoa Nguyen. In cross-examination, Mau Duong agreed that he had earlier said that the transactions he had described in his evidence-in-chief had occurred in the reverse order. The order in which the transactions occurred did not take on any particular significance in the trial. Several of those who had been in the flat when the shootings happened gave evidence at trial that, in the early hours of Monday, 8 November 2004, Bill Ho, Dang Khoa Nguyen and the respondent came to the flat. The room in which all of the relevant events occurred was about 6 metres long by 4 metres wide. It had a double bed, a stereo and a television set and there were numerous people in the room as events unfolded. One or more of the men who had come to the flat was asking, "Where's Mau? Where's Mau?" There was screaming and arguing. One of the men had a samurai sword which he was swinging around. Several witnesses identified the men in a fashion that would permit the jury to conclude that the respondent was the man with the sword. Whether he had come to the flat with the sword, or found it there, was open to question. One of the occupants of the flat (Kathleen Quach) described a man (who the jury could conclude was the respondent) coming into the room with a sword in his hand, followed by Bill Ho and then Dang Khoa Nguyen. She said that the man with the sword (the "long haired one") or another man (Dang Khoa Nguyen) was asking for Mau Duong. On being told by Tien Manh Pham that Mau Duong was not there, Bill Ho asked for Mau's phone number. Ms Quach said that while Hayne Tien was scrolling through his phone looking for a number, the man with the sword was walking around the room pointing the sword at people asking "Where's [Mau]? Do you [know] where [Mau] is?" Another occupant of the flat (Hung Manh Nguyen) gave evidence of a man "waving [a sword] around" and that he (Hung Manh Nguyen) was "scared when the sword [was being waved around] ... so I was standing close to the wall with the other friends". Although he did not remember being hurt, other evidence suggested that he had been cut by the sword. Tien Manh Pham gave evidence of the respondent putting the sword against his throat and, pushing forward in a stabbing motion, cutting him a little bit. Soon after Tien Manh Pham was cut by the sword, Bill Ho shot first Chau Minh Nguyen and then Hieu Trung Luu. Chau Minh Nguyen had been sleeping on the floor. According to the evidence of Kathleen Quach, Bill Ho took a gun from his pocket and "was spinning the barrel around". She later agreed that he had been spinning the "cylinder part of the gun [that] had popped out the side of the gun", an answer that could well be understood as referring to the cylinder of a revolver. Bill Ho agreed in his evidence that he had "deliberately fiddled with the gun ... in a way ... that the occupants of the flat could see". As Kathleen Quach described it, Bill Ho "closed the gun and then Chau woke up so he turned around and [Ho] took a shot". Chau Minh Nguyen was shot in the head. Kathleen Quach said that Hieu Trung Luu (who had been smoking marijuana earlier in the night, but was lying asleep on the bed in the room when the three men came in) woke up because of the shot, and stood on the bed. Bill Ho fired a second shot and Hieu Trung Luu fell on top of the coffee table. At first Kathleen Quach said that the time between shots was "a couple of minutes" but later agreed that she had previously estimated the interval to be 10 to 15 seconds. Chau Minh Nguyen gave an account of events in the room between his waking up and his being shot. The account he gave was generally similar to that given by Kathleen Quach, but was a more elaborate account of what happened immediately before he was shot. Chau Minh Nguyen spoke of his being asleep and waking to find the three men in the flat. He described a man waving a "Japanese sword". He described another man (Bill Ho) kneeling on one knee, asking Tien Manh Pham: "Find Mau for me, find Mau for me". The "man with the sword" was sitting on the bed. The third man (Dang Khoa Nguyen) was sitting on the stereo. Chau Minh Nguyen said that he then saw the man on the Hayne stereo (Dang Khoa Nguyen) say to the man kneeling down (Bill Ho): "Get him off" or "Fuck him off". Bill Ho then pulled out a gun and pointed the gun directly at Chau Minh Nguyen, asking "That guy?". Chau Minh Nguyen testified that the man on the stereo (Dang Khoa Nguyen) "nodded his head", and Bill Ho then shot him. The evidence given at trial about what happened after the two men had been shot was not consistent. Kathleen Quach said initially that "[t]he black haired guy ... with the sword" said "Let's just go and dump the body". Later in her evidence she said that this was said by "either the guy with the gun or the guy with the sword". She said that "they" were still asking for Mau, and that "the black haired guy with the sword" "was walking around the room and he was just slashing down" with the sword. She said that she thought that the sword "got Viet [Viet Tran] on the knee", but that this might have happened before or after the shots had been fired. Kathleen Quach also said in evidence that, before the men left, "the man with the sword" said "If we leave don't call the police or the ambulance" and "they" said "Just, you don't know who we are if anyone ask". In her next answer, she said that all three men ("the blond one and the short haired, the long haired one and the sword") had said this. It was well open to the jury to conclude that the "blond one" was Bill Ho, "the short haired" was Dang Khoa Nguyen, and the one with "the sword" was the respondent, Dang Quang Nguyen. On the whole of the evidence, it was open to the jury to be satisfied, beyond reasonable doubt, that all three men had come to the flat searching for Mau Duong for payment of a debt. In particular, the jury could be satisfied that Dang Quang Nguyen knew that they went to the flat searching for Mau Duong for payment of a debt, and that, either before or after arriving at the flat, Dang Quang Nguyen armed himself with a sword with which he sought to enforce the demands for information that all three were making. The jury could further be satisfied that Dang Quang Nguyen used the sword in a way that showed his willingness to inflict cutting injuries on those in the flat. Those findings of fact were not inevitable, but they were open. It was also open to the jury to conclude that, before the first shooting, Bill Ho had produced a revolver and had spun the cylinder in an attempt to intimidate those who were in the room. Given the size of the room, and the places in the room said to be occupied by those who were there, the jury could conclude that Dang Quang Nguyen (like other occupants of the room) must have seen the gun that Bill Ho had produced and was manipulating in a threatening manner. Hayne The prosecution case To convict Bill Ho of attempted murder, the jury had to be satisfied that he had intended to kill Chau Minh Nguyen8. To convict Bill Ho of murder, the jury had to be satisfied that he shot Hieu Trung Luu intending either to kill him or to inflict really serious injury upon him. The jury were instructed accordingly, but the trial judge also directed the jury that, if not satisfied that Bill Ho was guilty of the murder of Hieu Trung Luu, they should consider whether he was guilty of manslaughter by unlawful and dangerous act. The prosecution case against Dang Khoa Nguyen and Dang Quang Nguyen was put on three different bases of criminal complicity: acting in concert, common purpose and aiding and abetting. In argument in this Court, the prosecution submitted that its central thesis at trial was that the three men agreed to collect a drug debt and agreed that, if necessary, they would kill to achieve that end. At trial, the prosecution submitted that if the men had not made that agreement before they arrived at the flat, such an arrangement arose after they got there. This was said to be so because of what happened in the flat, including Dang Quang Nguyen then being armed with a sword. The defence case Dang Quang Nguyen did not give evidence at trial. In the statement of his defence, made to the jury after the prosecution opening, emphasis was given to the prosecution's task of proving guilt beyond reasonable doubt. It was pointed out that there would be no evidence that Dang Quang Nguyen had been involved in any drug transaction with Mau Duong or that he knew of any drug debt. Accordingly, it was said that the prosecution would not demonstrate any acting in concert or any common purpose to which Dang Quang Nguyen was a party and would not demonstrate that he aided or abetted the commission of any crime by The general tenor of the cross-examination of witnesses on behalf of Dang Quang Nguyen was that, in the flat, he had appeared to be drunk, to be behaving foolishly, and to be "just having a laugh at the whole incident". 8 Alister v The Queen (1984) 154 CLR 404 at 421-422 per Gibbs CJ; [1984] HCA 85; McGhee v The Queen (1995) 183 CLR 82 at 85-86 per Brennan J; [1995] HCA Hayne Bill Ho gave evidence at the trial. Reference has already been made to some of that evidence. He said that he had told the other two men that he was "just going to a friend's house to pick up some money quickly". In answer to questions put on behalf of Dang Quang Nguyen, Bill Ho denied that he had told Dang Quang Nguyen that he had a gun and denied that he had shown him the gun before they entered the flat. He denied that Dang Quang Nguyen had had a sword when he went to the flat. He described Dang Quang Nguyen as "quite simple". In evidence-in-chief he gave an account of the men leaving the flat, and of Dang Quang Nguyen hysterically asking him, more than once, "Why did you shoot him?" His reply, so he said, was "it was an accident". Was it open to the jury, on the whole of the evidence, to return verdicts of guilty against the respondent on both counts? "Unsafe or unsatisfactory"? The task of an appellate court in considering whether a verdict of guilty returned by a jury "should be set aside on the ground that it is unreasonable or cannot be supported having regard to the evidence"9 was described by this Court in M10. As four members of the Court pointed out11 in M, the conclusion that a verdict should be set aside on this basis is often expressed in terms of the verdict being "unsafe or unsatisfactory", "unjust or unsafe" or "dangerous or unsafe". The question for the appellate court is one of fact. "[T]he question which the court must ask itself is whether it thinks that upon the whole of the evidence it was open to the jury to be satisfied beyond reasonable doubt that the accused was guilty."12 As the plurality in M went on to point out13: 9 Crimes Act 1958 (Vic), s 568. 10 (1994) 181 CLR 487. 11 (1994) 181 CLR 487 at 492 per Mason CJ, Deane, Dawson and Toohey JJ. 12 M v The Queen (1994) 181 CLR 487 at 493 (footnote omitted). 13 (1994) 181 CLR 487 at 493. Hayne "But in answering that question the court must not disregard or discount either the consideration that the jury is the body entrusted with the primary responsibility of determining guilt or innocence, or the consideration that the jury has had the benefit of having seen and heard the witnesses. On the contrary, the court must pay full regard to those considerations14." The authoritative guidance which this Court provided in M about the task of a court of criminal appeal was expressed15 in the following terms: the evidence, upon "It is only where a jury's advantage in seeing and hearing the evidence is capable of resolving a doubt experienced by a court of criminal appeal that the court may conclude that no miscarriage of justice occurred. That is to say, where the evidence lacks credibility for reasons which are not explained by the manner in which it was given, a reasonable doubt experienced by the court is a doubt which a reasonable jury ought to have experienced. itself, contains discrepancies, displays inadequacies, is tainted or otherwise lacks probative force in such a way as to lead the court of criminal appeal to conclude that, even making full allowance for the advantages enjoyed by the jury, there is a significant possibility that an innocent person has been convicted, then the court is bound to act and to set aside a verdict based upon that evidence16. In doing so, the court is not substituting trial by a court of appeal for trial by jury, for the ultimate question must always be whether the court thinks that upon the whole of the evidence it was open to the jury to be satisfied beyond reasonable doubt that the accused was guilty17." the record There was ample evidence from which the jury could conclude that Bill Ho was guilty of the attempted murder of Chau Minh Nguyen and the murder of Hieu Trung Luu. Was there evidence from which a jury could conclude, beyond reasonable doubt, that Dang Quang Nguyen was complicit in the attempted murder and the murder which Bill Ho committed? 14 Chamberlain v The Queen [No 2] (1984) 153 CLR 521 at 621; [1984] HCA 7. 15 (1994) 181 CLR 487 at 494-495. 16 Chamberlain [No 2] (1984) 153 CLR 521 at 618-619; Chidiac v The Queen (1991) 171 CLR 432 at 443-444; [1991] HCA 4. 17 Chidiac (1991) 171 CLR 432 at 443, 451, 458, 461-462. Hayne The conclusion of the Court of Appeal, that there was not, proceeded18 from two premises: first, that there was no evidence that Dang Quang Nguyen knew that either or both of Bill Ho or Dang Khoa Nguyen was involved in trafficking heroin or knew of the existence of a drug debt, and second, that there was no evidence that Dang Quang Nguyen knew that Bill Ho went to the flat with a gun, and insufficient evidence to conclude beyond reasonable doubt that Dang Quang Nguyen went to the flat armed with a sword. In this Court, the prosecution submitted that the Court of Appeal did not undertake the task required of it. In large part this submission appeared to rest upon the proposition that the Court of Appeal did not, or at least did not sufficiently, consider what inferences the jury could draw from the evidence that was led. Instead, so the argument proceeded, the Court of Appeal confined its consideration to whether there was any "evidence" [scil. direct evidence] of certain matters (particularly the two matters identified as the premises from which the reasoning of Neave JA proceeded). It is not necessary to consider whether this submission of the prosecution is well founded. For present purposes, it is sufficient to observe that the evidence that was led at trial permitted the jury to be satisfied of the matters identified earlier in these reasons, namely: that all three men had come to the flat searching for Mau Duong for payment of a debt, and that, before or after arriving at the flat, Dang Quang Nguyen armed himself with a sword with which he sought to enforce the demands for information that the men were making. Once it is shown that the jury could conclude that Dang Quang Nguyen was party to an arrangement to collect a debt using violent means if necessary, the question becomes: what level of violence did Dang Quang Nguyen agree would be used, what level of violence did he foresee might be used, what level of violence did he encourage Bill Ho to use? It matters not whether he knew that the debt was for sale of drugs or on some other account. If, as was open to the jury, it was found beyond reasonable doubt that Dang Quang Nguyen saw Bill Ho using a gun in a threatening manner, an appreciable time before the first shot was fired, it was also open to the jury to conclude that, in the light of what Dang Quang Nguyen had already done in the room and his not dissociating himself from the use of the gun, he agreed in the use of deadly force, contemplated that it might be used, or encouraged its use. 18 [2010] VSCA 23 at [104]. Hayne Whether or not Dang Quang Nguyen was (or appeared to be) drunk, whether or not he appeared to be behaving foolishly, he had threatened those in the flat with the sword and had cut two if not three of them before a shot was fired. The jury could conclude that he saw that Bill Ho had a gun, and that Bill Ho was attempting to intimidate the occupants of the flat by spinning the cylinder. It was open to the jury to conclude that Dang Quang Nguyen was complicit in the attempted murder of Chau Minh Nguyen and the murder of Hieu Trung Luu. It was not shown that the verdicts returned by the jury against Dang Quang Nguyen were unreasonable or cannot be supported having regard to the evidence. The Court of Appeal was wrong to conclude to the contrary. Was there, as the respondent submitted, misdirection of the jury? Misdirection? The trial judge gave the jury both oral and written directions about each of the three different ways in which the prosecution sought to prove its case against Dang Khoa Nguyen and Dang Quang Nguyen, the two men who the prosecution alleged were complicit in crimes committed by Bill Ho. The written directions given to the jury dealt with all three bases of liability without distinguishing between their application in relation to the count of attempted murder and the count of murder. Thus each relevant part of the written directions was introduced by the rubric: "In order to prove that Khoa Nguyen or Quang Nguyen is guilty of any crime committed by Bill Ho on the basis of [acting in concert, common purpose or aiding and abetting] the prosecution must prove beyond reasonable doubt that ...". The matters which it was said that the prosecution was obliged to prove to the requisite standard were described in terms adapted to the particular bases of liability in question. In the case of acting in concert, it was said that the jury had to be satisfied (among other things) that: "there was an understanding or arrangement amounting to an agreement between Khoa Nguyen or Quang Nguyen as the case may be – or both of them – and Bill Ho – that they would kill intentionally if necessary to recover a drug debt". (emphasis added) Hayne In the case of common purpose, it was said that the jury must be satisfied (among other things) that: there was an understanding or arrangement amounting to an agreement between Khoa Nguyen or Quang Nguyen as the case may be – or both of them – and Bill Ho – that they would use violence to recover a drug debt; (3) Khoa Nguyen or Quang Nguyen contemplated or foresaw the possibility that an intentional killing might occur as a necessary part of carrying out that agreement; (4) Khoa Nguyen or Quang Nguyen was present at the scene of the crime in accordance with the agreement either helping or being ready to help if called upon – even though he contemplated or foresaw the possibility that an intentional killing might occur as a necessary part of carrying out that agreement". (emphasis added) By contrast, in the case of aiding and abetting, nothing was said about intention to kill. Rather, the instruction given about aiding and abetting identified the matters to be proved as being that: the crime in question was committed by Bill Ho; (2) Khoa Nguyen or Quang Nguyen was present when Bill Ho committed that crime (being 'in the vicinity of the crime so as to be able to help or encourage its commission if he was inclined to do so') and (3) Khoa Nguyen or Quang Nguyen intentionally: encouraged Bill Ho to commit that crime (might be by words or presence and behaviour provided he intended to encourage Bill Ho to commit that crime and did encourage him); or communicated to Bill Ho that he assented and concurred in the commission of that crime (might be communicated by words or presence and behaviour – provided he intended to convey his assent and concurrence that way) and Hayne (c) Khoa Nguyen or Quang Nguyen knew that Bill Ho was doing the acts which constituted that particular crime – with the necessary intention for that particular crime." (emphasis added) The respondent submitted that the trial judge's directions about complicity did not sufficiently leave manslaughter as an alternative verdict available to the jury against the respondent in respect of the death of Hieu Trung Luu. During her charge to the jury, the trial judge began to give the jury some oral directions about the availability of manslaughter by concert, or manslaughter by extended common purpose. But the trial judge then withdrew those instructions, and gave the jury the written directions to which reference has been made. The effect of those instructions was to leave manslaughter to the jury as a possible verdict against Dang Quang Nguyen only if Bill Ho was guilty of that crime. If Bill Ho was found guilty of murder, no case of manslaughter was left for consideration by the jury in respect of Dang Quang Nguyen. Trial counsel took no exception to the instructions. According to the instructions given to the jury, there could be no different verdict of guilt against the accused with respect to the count of murder. That is, if Bill Ho was guilty of murder, the respondent, Dang Quang Nguyen, and the other co-accused, Dang Khoa Nguyen, were in each case either guilty of murder, or not guilty of any crime, with respect to the death of Hieu Trung Luu. The respondent submitted that the trial judge's instructions precluded the jury from considering what were described as "viable and entirely apt alternative verdicts" on the charge of murder. Counsel for the respondent offered three examples of findings of fact which were open, and if made, would have led to a verdict of manslaughter: one in respect of each of extended common purpose, concert and aiding and abetting. As to extended common purpose, it was said that if the jury were satisfied that the respondent knew of the presence of the gun before the shootings occurred, and was party to a plan that violence would be threatened to recover a drug debt, it was possible that the purpose was to do no more than cause serious harm to another short of really serious injury. As to concert, it was said that it may have been that the arrangement was for Bill Ho to do no more than assault or threaten others in a dangerous fashion. As to aiding and abetting, it was said that the respondent's words and actions may have encouraged or assisted Bill Ho to assault or threaten others but not to kill or do really serious injury. Contrary to the prosecution's submission in this Court, each of these conclusions was available to the jury. Again, the conclusions were not the only Hayne findings the jury could make, but they were open. That the prosecution had put its case on the footing that deadly force was always contemplated did not preclude the jury from finding the facts in a way that was consistent with any of the three ways put forward by the respondent in argument in this Court. It is to be observed that the three instances given on behalf of the respondent all focused upon what the respondent knew or intended or contemplated would be done to recover a drug debt. These submissions serve to emphasise a point of particular importance to the way in which the instructions to the jury in this case might have been formulated. As in Clayton v The Queen19, the principal issues in the case against the respondent were factual issues: (a) What did the respondent agree was to happen in the flat? (b) What did he foresee was possible? (c) What did he do in the flat, if anything, to aid and abet Bill Ho in shooting either victim? Had the jury's attention been directed to those three questions and the necessary directions of law framed by reference to the available answers, the directions would very likely have been far less complicated than they were. The prosecution submitted in this Court that the instructions that were given to the jury about complicity were adequate because, on the charge of attempted murder, any secondary liability of Dang Quang Nguyen depended upon Bill Ho being found to have intended to kill, and no lesser agreement or contemplation would suffice to make Dang Quang Nguyen complicit in that crime. That is, to be guilty of attempted murder, the respondent must have been party to an agreement to kill, or have foreseen that there would be an assault with intention to kill, or have assisted or encouraged an assault committed with that intention. The prosecution further submitted that, because the charge of murder arose out of an event that occurred very soon after the shooting said to be an attempted murder, it was not reasonably open to the jury to conclude that when the second shooting occurred there was some different, lesser, agreement or contemplation on the part of Dang Quang Nguyen. Hence, the prosecution argument continued, the real issue in the case against Dang Quang Nguyen, so far as concerned his complicity in the second crime that was committed, was 19 (2006) 81 ALJR 439 at 444 [25]; 231 ALR 500 at 506; [2006] HCA 58. Hayne whether he was party to an agreement to kill or do really serious injury, or foresaw that there would be an assault with murderous intent, or assisted or encouraged an assault with that intent. And this, so it was submitted, was the only way in which the prosecution had put its case at trial. The respondent's argument that the directions given to the jury about the complicity of Dang Quang Nguyen were insufficient should be accepted. It is right to observe that Dang Quang Nguyen could not be found guilty of attempted murder unless he was party to an agreement to kill, or foresaw that there would be an assault with murderous intent, or assisted or encouraged an assault with that intent. The prosecution's argument, that there was no viable case of manslaughter to be considered in relation to the count of murder, depended upon the jury deciding that Dang Quang Nguyen was guilty of attempted murder. That argument assumed that the jury would consider the two charges in the order in which the events were alleged to have occurred, not in the order in which they were stated on the presentment. But the jury were not directed to consider the charge of attempted murder first, and only then turn to the charge of murder. The order in which the jury considered the charges was rightly left for the jury to decide. The written instructions that were given did not require the charges to be considered in any particular order, and treated the two counts as governed by the same principles. If Dang Quang Nguyen was party to an agreement, or had a contemplation, or provided assistance directed to some lesser assault than one intended to kill, it would have been open to the jury to conclude that, although he was not guilty of the charge of attempted murder, a verdict of manslaughter should be returned in respect of the count charging him with murder. The trial judge's directions did not admit of that possibility. This Court's decisions in Gilbert v The Queen20 and in Gillard v The Queen21 require the conclusion that, in giving the directions the trial judge did about complicity, her Honour made a wrong decision on a question of law. It was wrong not to leave manslaughter as an available verdict against Dang Quang Nguyen, even if Bill Ho was guilty of murder. The decisions in Gilbert and Gillard also require the further conclusion that it cannot be said that there was no substantial miscarriage of justice in the case of Dang Quang Nguyen in not leaving manslaughter as an available verdict. 20 (2000) 201 CLR 414 at 416-417 [1]-[2] per Gleeson CJ and Gummow J, 434 [70] per Callinan J; [2000] HCA 15. 21 (2003) 219 CLR 1 at 14 [26] per Gleeson CJ and Callinan J, 15 [32] per Gummow J, 34-35 [106], 40 [129] per Hayne J; [2003] HCA 64. Hayne Whether some different conclusion could or should be reached about substantial miscarriage of justice in the case of Dang Khoa Nguyen is a question that was not addressed in argument and about which we express no opinion. Nor is there any occasion to consider the utility of a distinction of the kind identified by the House of Lords in R v Rahman22. There a distinction was drawn between cases where a weapon of which the alleged secondary party does not know is suddenly produced and used by the principal, and which is more lethal than any weapon which the secondary party contemplated may be carried, and other cases where there was no sudden production of an unknown and more lethal weapon. It is sufficient to say that the principles identified in Gillard and Clayton do not draw such a distinction. What orders should be made? The respondent submitted that proceedings against him have been so protracted that, even if the verdicts returned by the jury were not unsafe or unsatisfactory, the conclusion that the trial judge misdirected the jury should lead either to the refusal of the prosecution's application for special leave to appeal or, if that application were to be granted, to the dismissal of the appeal against the orders actually made by the Court of Appeal. The respondent is right to submit that proceedings against him have been unduly protracted. That his first trial did not proceed to verdict may or may not be a matter about which he can complain. That his subsequent trials did not begin until nearly a year later is a cause for concern. The liberty of the accused was at stake. The memory of witnesses was inevitably changing and fading. Why there should be such a long delay was not explained. It is equally unsatisfactory that his application for leave to appeal to the Court of Appeal did not come on for hearing until 18 months after his conviction. That delay is far too long. Once the application for leave to appeal did come on for hearing, it was important that the application be disposed of promptly. It was not. The record of the trial was not voluminous. The transcript of evidence was less than 600 pages and the facts described in the evidence were not complex. The principles to be applied in determining the appeal were well established. There was no division 22 [2009] 1 AC 129 at 165 [68] per Lord Brown of Eaton-under-Heywood. Hayne of opinion in the Court of Appeal about the disposition of the case or the reasons given for that disposition. If, as the Court of Appeal concluded, the respondent had been wrongly convicted, orders quashing his conviction, thus securing his freedom from custody, together with reasons for that conclusion, should have been made and published much sooner than they were. Whatever the outcome of the application, the period for the Court's consideration of the matter should have been measured in days or weeks, not months. Despite the undue protraction of this matter, this Court should not refuse special leave to appeal to correct the departure from principle. This Court should not make an order affirming the entry of a verdict of acquittal when the jury at the respondent's trial returned verdicts of guilty that were open on the evidence. The misdirection of the jury identified in this Court required that the respondent's application for leave to appeal to the Court of Appeal be granted, the appeal allowed, his conviction quashed, and an order made that a new trial be had. This Court should grant each party special leave to appeal or cross-appeal as the case requires, treat the appeal and cross-appeal as instituted and heard instanter, allow the appeal and the cross-appeal, and make those orders which the Court of Appeal should have made. Whether, in all of the circumstances of the case, the Director of Public Prosecutions should prosecute the respondent further is a matter for his decision.

HIGH COURT OF AUSTRALIA APPELLANT AND COMMONWEALTH OF AUSTRALIA RESPONDENT Chetcuti v Commonwealth of Australia [2021] HCA 25 Date of Hearing: 11 May 2021 Date of Judgment: 12 August 2021 ORDER Appeal dismissed with costs. On appeal from the High Court Representation G L Schoff QC with G A Costello QC and K E Slack for the appellant (instructed by Lawson Bayly) S P Donaghue QC, Solicitor-General of the Commonwealth, and C L Lenehan SC with Z C Heger for the respondent (instructed by Australian Government Solicitor) M J Wait SC, Solicitor-General for the State of South Australia, with J F Metzer for the Attorney-General for the State of South Australia, intervening (instructed by Crown Solicitor's Office (SA)) Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Chetcuti v Commonwealth of Australia Constitutional law (Cth) – Powers of Commonwealth Parliament – Naturalisation and aliens – Deportation – Where appellant entered Australia before commencement of Nationality and Citizenship Act 1948 (Cth) – Where appellant born in Malta and entered Australia as British subject – Where appellant became citizen of United Kingdom and Colonies in 1949 and citizen of Malta in 1964 – Where appellant had not applied to become Australian citizen by registration under Nationality and Citizenship Act – Where appellant's visa cancelled following conviction – Whether appellant entered Australia as alien – Whether within power of Parliament to treat appellant as alien within meaning of s 51(xix) of Constitution. Words and phrases – "alien", "alienage", "aliens power", "allegiance", "Australian independence", "British subject", "citizen", "citizenship", "Crown in right of Australia", "non-citizen", "treat as an alien". Constitution, s 51(xix). British Nationality and Status of Aliens Act 1914 (UK), s 1(1)(a). Nationality Act 1920 (Cth), ss 5(1), 6(1)(a). Nationality and Citizenship Act 1948 (Cth), ss 12, 24, 25. KIEFEL CJ, GAGELER, KEANE AND GLEESON JJ. This is an appeal as of right from a final judgment given by Nettle J1 after a trial on agreed facts in a proceeding in the original jurisdiction of the High Court in which the appellant challenged his detention under the Migration Act 1958 (Cth) on the ground that he is not within the reach of the legislative power with respect to aliens conferred by s 51(xix) of the Constitution. His Honour concluded that the appellant is within the reach of that power and so gave judgment for the respondent. The conclusion reached by Nettle J was correct. The appeal must be dismissed. The appellant's circumstances The appellant was born on 8 August 1945 in Malta, then still a Colony of the United Kingdom. By virtue of his birth in Malta, the appellant had from birth the status of a British subject under the British Nationality and Status of Aliens Act 1914 (UK) and from 1 January 1949 the status of a citizen of the United Kingdom and Colonies under the British Nationality Act 1948 (UK). At the commencement of the Malta Independence Act 1964 (UK) on 21 September 1964, the appellant ceased to have the status of a citizen of the United Kingdom and Colonies, and acquired in its place the status of a citizen of the State of Malta under the Constitution of Malta. When the State of Malta became the Republic of Malta on 13 December 1974, he continued to have the status of a Maltese citizen under Maltese law. The appellant arrived in Australia on 31 July 1948. He has not since left Australia other than to visit Malta for several months between 1958 and 1959. At the time of his arrival in Australia, the appellant had the status of a British subject under the Nationality Act 1920 (Cth) by virtue of his birth "within His Majesty's dominions and allegiance"2. At the commencement of the Australian Citizenship Act 1948 (Cth)3 on 26 January 1949, the appellant had the status of a British subject under that Act by virtue of his citizenship of the United Kingdom 1 Chetcuti v The Commonwealth (2020) 95 ALJR 1; 385 ALR 1. See s 5(1) (definition of "British subject") and s 6(1)(a) of the Nationality Act. 3 Originally known as the Nationality and Citizenship Act 1948 (Cth) and now superseded by the Australian Citizenship Act 2007 (Cth). and Colonies4. Cessation of that citizenship on 21 September 1964 resulted in simultaneous cessation of that status. The appellant appears to have regained the status of a British subject under the Australian Citizenship Act on 15 January 19655. From then he appears to have retained that status until abolition of that status altogether on the commencement of relevant provisions of the Australian Citizenship Amendment Act 1984 (Cth) on 1 May 19876. Following a trial by jury in the Supreme Court of New South Wales, the appellant was convicted in 1993 of murder and sentenced to a term of imprisonment of 24 years. At the commencement of relevant provisions of the Migration Legislation Amendment Act 1994 (Cth) on 1 September 1994, the appellant was taken to be granted an Absorbed Person visa under the Migration Act7. In 2017, by reference to the appellant's conviction in 1993, the Minister for Immigration and Border Protection made a decision to cancel his Absorbed Person visa under the Migration Act8. The appellant was soon afterwards taken into detention under the Migration Act. There he remains. See s 5(1) (definition of "British subject") and s 7(1) and (2) of the Australian Citizenship Act. See s 5 of the Nationality and Citizenship Act 1958 (Cth), which repealed and replaced s 7(2) of the Australian Citizenship Act, inserting a regulation making power for the purposes of that section; reg 1 of the Regulations under the Nationality and Citizenship Act 1948-1960 (Cth); s 6 of the Citizenship Act 1969 (Cth), which repealed and replaced s 7(1) and (2) of the Australian Citizenship Act. See s 7 of the Australian Citizenship Amendment Act. No party sought to argue that Malta becoming a republic on 13 December 1974 affected the appellant's status as a British subject under the Australian Citizenship Act. See s 8 of the Migration Legislation Amendment Act, which inserted s 26AB, now s 34 of the Migration Act. See s 501 of the Migration Act. The initial decision to cancel the appellant's visa was set aside by consent on judicial review by the Federal Court, following which the Minister for Immigration and Border Protection immediately made another decision to cancel the visa. That further cancellation decision was upheld at first instance on judicial review by the Federal Court in 2018 but set aside on appeal to the Full Court of the Federal Court in 20199. The Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs then immediately made yet another decision to cancel the visa. That further cancellation decision was at the time Nettle J gave judgment the subject of an undetermined application to the Federal Court for judicial review. The appellant's argument Since 2 April 198410, the Commonwealth Parliament has relied on the legislative power with respect to aliens to sustain the Migration Act. Subject to providing through s 15A of the Acts Interpretation Act 1901 (Cth) for the Migration Act to have a distributive and severable operation to the extent of any constitutional overreach11, the Parliament has done so treating all non-citizens as aliens. And since 1 September 199412, it has done so creating a clear-cut distinction between lawful non-citizens, being non-citizens who hold visas permitting them to enter and remain in Australia13, and unlawful non-citizens, being non-citizens who 9 Chetcuti v Minister for Immigration and Border Protection (2019) 270 FCR 335. 10 The date of commencement of the Migration Amendment Act 1983 (Cth). See generally Minister for Immigration and Multicultural and Indigenous Affairs v Nystrom (2006) 228 CLR 566 at 574-575 [10], [13]. 11 Pochi v Macphee (1982) 151 CLR 101 at 110. 12 The date the Migration Reform Act 1992 (Cth) fully came into force. See generally Minister for Immigration and Multicultural and Indigenous Affairs v Nystrom (2006) 228 CLR 566 at 575-576 [15]. 13 Section 13 of the Migration Act. do not hold visas14 and who are in consequence liable to detention and to removal from Australia15. In challenging his detention on the ground that he is not within the reach of the aliens power, the appellant does not seek to disturb the settled understanding that the aliens power encompasses both power to determine who is and who is not to have the legal status of an alien and power to attach consequences to that status16. Nor does the appellant seek to disturb the settled understanding that, in determining who is and who is not to have the legal status of an alien, it is in general open to the Parliament to "treat as an alien any person who was born outside Australia, whose parents were not Australians, and who has not been naturalized as an Australian"17. Seeking to build on the recognition by the majority in Love v The Commonwealth18 of an exception in respect of a person who is an Aboriginal Australian according to the tripartite test in Mabo v Queensland [No 2] 19, the appellant argues for recognition of a further exception. The further exception is in respect of a person who was a natural born British subject and who commenced residing permanently in Australia before 26 January 1949. The appellant argues that the status of a non-alien attaches indelibly to a person in that category either by reason of the person having been born within the allegiance of an as yet 14 Sections 14 and 15 of the Migration Act. 15 Sections 189, 196 and 198 of the Migration Act. 16 Re Minister for Immigration and Multicultural Affairs; Ex parte Te (2002) 212 CLR 162 at 170-172 [21]-[26], 219-220 [209]-[210]; Shaw v Minister for Immigration and Multicultural Affairs (2003) 218 CLR 28 at 35 [2], 87 [190]; Koroitamana v The Commonwealth (2006) 227 CLR 31 at 38 [11], 46 [48]. See earlier Brazil, "Australian Nationality and Immigration", in Ryan (ed), International Law in Australia, 2nd ed (1984) 210 at 217 explaining Pochi v Macphee (1982) 151 CLR 17 Nolan v Minister for Immigration and Ethnic Affairs (1988) 165 CLR 178 at 185, quoting Pochi v Macphee (1982) 151 CLR 101 at 109-110. (2020) 94 ALJR 198; 375 ALR 597. (1992) 175 CLR 1 at 70. undivided Imperial Crown or by reason of the Parliament having once and for all determined the person not to be an alien under the Nationality Act. The answer to the appellant's argument The answer to the appellant's argument is to be found in the reasons for judgment of the majority in Shaw v Minister for Immigration and Multicultural Affairs20, from which the holding of the majority in Love v The Commonwealth does not depart except in respect of an Aboriginal Australian according to the tripartite test in Mabo v Queensland [No 2]. The conclusion of the majority in Shaw was confined in its terms to a determination that "the aliens power has reached all those persons who entered this country after the commencement of [the Australian Citizenship Act] on 26 January 1949 and who were born out of Australia of parents who were not Australian citizens and who had not been naturalised"21. The reasoning employed by the majority to reach that conclusion nevertheless equally supports the conclusion that the aliens power has reached all those persons who entered this country before 26 January 1949 who did not then or did not afterwards become Australian citizens. Essential to the reasoning of the majority in Shaw were the propositions that: (i) "[t]here never was a common law notion of 'British subject' rendered into an immutable element of 'the law of the Constitution'"22; (ii) the Commonwealth Parliament exercised the aliens power in establishing by the Australian Citizenship Act the status of an Australian citizen on and from 26 January 194923; (iii) on and from which date persons who have not had the status of Australian citizens have been aliens, persons having the status of British subjects but not the status of Australian citizens forming a class of aliens on whom special privileges were for some time afterwards conferred24; and (iv) by which date the development of Australian sovereignty had been such that the constitutional term "subject of the (2003) 218 CLR 28. (2003) 218 CLR 28 at 43 [32], 87 [190]. (2003) 218 CLR 28 at 42 [28], 87 [190]. (2003) 218 CLR 28 at 40 [21]-[22], 87 [190]. (2003) 218 CLR 28 at 40 [21]-[22], 87 [190]. Queen"25 could no longer be taken to refer to a subject of an Imperial Crown but to a subject of the Crown in right of Australia, being an Australian citizen26. The significance of that reasoning to the status on and from 26 January 1949 of a person who entered Australia before that date and who did not on that date or afterwards become an Australian citizen is best appreciated by noting at the outset observations as early as 190627 and as late as 193628 that there was no such thing as a distinct "Australian nationality". The Nationality Act – itself an exercise of the aliens power – did no more than restate the common law29 as replicated in the British Nationality and Status of Aliens Act30 (which appears in relevant part to have applied in Australia by paramount force31) in so far as it provided that "[a]ny person born within his Majesty's dominions and allegiance" was to be deemed to be a natural born British subject32 so as to be included within the statutory definition of British subject33 and for that reason excluded from the statutory definition of alien34. Even at the time of enactment of the Nationality Act in 1920, political and demographic forces within the British Empire were fracturing the consensus reached at the Imperial Conference of 1911 that "Imperial nationality should be 25 See ss 34 and 117 of the Constitution. (2003) 218 CLR 28 at 37-38 [13]-[14], 39-40 [20], 42 [28], 87 [190]. 27 Attorney-General for the Commonwealth v Ah Sheung (1906) 4 CLR 949 at 951. 28 R v Burgess; Ex parte Henry (1936) 55 CLR 608 at 650. 29 See Nolan v Minister for Immigration and Ethnic Affairs (1988) 165 CLR 178 at 30 Section 1(1)(a) and s 27(1) (definitions of "British subject" and "alien") of the British Nationality and Status of Aliens Act. 31 See Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 440 [148]. 32 Section 6(1)(a) of the Nationality Act. 33 Section 5(1) (definition of "British subject") of the Nationality Act. 34 Section 5(1) (definition of "alien") of the Nationality Act. worldwide and uniform"35 which had underpinned the enactment in 1914 of the British Nationality and Status of Aliens Act36. Following on from the Balfour Declaration of the Imperial Conference of 1926 to the effect that the United Kingdom and its Dominions were "autonomous Communities within the British Empire, equal in status, in no way subordinate one to another in any aspect of their domestic or external affairs, though united by a common allegiance to the Crown, and freely associated as members of the British Commonwealth of Nations"37, the Imperial Conference of 1930 not only agreed to the principles of the Statute of Westminster 1931 (UK), ultimately adopted by the Commonwealth Parliament in the Statute of Westminster Adoption Act 1942 (Cth), but concluded that "it is for each Member of the Commonwealth to define for itself its own nationals"38. On the understanding that the expression "a member of the community" of a Member of the Commonwealth of Nations was "intended to have a rather technical meaning, as denoting a person whom that Member of the Commonwealth has, either by legislative definition of its nationals or citizens or otherwise, decided to regard as 'belonging' to it, for the purposes of civil and political rights and duties, immigration, deportation, diplomatic representation, or the exercise of extra- territorial jurisdiction", the Imperial Conference of 1937 went on to resolve that it was for each Member of the Commonwealth of Nations "to decide which persons have with it that definite connection ... which would enable it to recognize them as members of its community"39. The resolution continued40: 35 Great Britain, Minutes of Proceedings of the Imperial Conference, 1911 (1911) [Cd 5745] at 267. 36 Parry, Nationality and Citizenship Laws of The Commonwealth and of The Republic of Ireland (1957) at 82-89. 37 Australia, Parliament, Imperial Conference, 1926: Summary of Proceedings (1927) 38 Great Britain, Imperial Conference, 1930: Summary of Proceedings (1930) Cmd 3717 at 19, 22. 39 Great Britain, Imperial Conference, 1937: Summary of Proceedings (1937) Cmd 5482 at 25. 40 Great Britain, Imperial Conference, 1937: Summary of Proceedings (1937) Cmd 5482 at 26. "Each Member of the Commonwealth would in the normal course include as members of its community: – persons who were born in, or became British subjects by naturalisation in, or as a result of the annexation of, its territory and still reside there, and persons who, coming as British subjects from other parts of the Commonwealth, have identified themselves with the community to which they have come. As regards those mentioned under (b) it is for each Member to prescribe the conditions under which any British subject coming from another part of the Commonwealth will be considered to have so identified himself with the new community to which he has resorted as to become a member thereof." Prompted by the enactment of the Canadian Citizenship Act 1946 (Can), the British Commonwealth Conference on Nationality and Citizenship of 1947 agreed upon a system for the working out of the resolution of the Imperial Conference of 1937 by which each Member of the Commonwealth of Nations "shall by its legislation determine who are its citizens, shall declare those citizens to be British subjects and shall recognise as British subjects the citizens of the other countries"41. Enacted in 1948 and commencing sequentially in 1949, the British Nationality Act and the Australian Citizenship Act implemented that agreed legislative pattern. "What the [British Nationality Act], and the parallel enactments elsewhere, did was to create a new, statutory concept of citizenship of each country concerned and to render the traditional and familiar status of a British subject ... a derivative status, capable of enjoyment, transitional cases apart, only in virtue of possession of the citizenship of one or more of the local 41 British Commonwealth Conference on Nationality and Citizenship (London, February 1947): Report with Appendices (1947) at 3 [9]. 42 See Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 441 [151]. 43 Parry, Nationality and Citizenship Laws of The Commonwealth and of The Republic of Ireland (1957) at 92 (footnote omitted). communities of the Commonwealth. The concept of allegiance, which had been the foundation of the status of a subject, was not imported into the rules governing local citizenship but was altogether swept away, together with all other rules of the common law respecting nationality." To similar effect, Gibbs CJ said of the British Nationality Act and the Australian Citizenship Act in Pochi v Macphee44: "The principles to which this legislation gave effect were that the peoples of each of the countries of the Commonwealth should have separate citizenship, but that all citizens of Commonwealth countries should have the common status of British subjects. ... [T]he Australian Citizenship Act gave effect to this common status, which was, of course, derivative, being dependent on the possession of citizenship." Through the operation of s 2(2) of the Statute of Westminster as adopted by the Commonwealth Parliament in the Statute of Westminster Adoption Act, the Australian Citizenship Act would have prevailed over the British Nationality and Status of Aliens Act if and to the extent that there had been any inconsistency45. In the co-ordinated sequence of events that occurred, however, no inconsistency arose. The British Nationality and Status of Aliens Act was repealed in relevant part on the commencement of the British Nationality Act on 1 January 194946. The Australian Citizenship Act then commenced on 26 January 1949 and on that date repealed the Nationality Act47. Part II of the Australian Citizenship Act provided for the status of British subject to be conferred on and from 26 January 1949 on an Australian citizen48 as well as on a person who "by an enactment for the time being in force" in a specified (1982) 151 CLR 101 at 108. 45 Phonographic Performance Co of Australia Ltd v The Commonwealth (2012) 246 CLR 561 at 573 [21], citing Kirmani v Captain Cook Cruises Pty Ltd [No 1] (1985) 159 CLR 351 at 375-377, 403-404, 423-424. 46 Section 34(3) of and the Fourth Schedule to the British Nationality Act. 47 Section 3 of and the First Schedule to the Australian Citizenship Act. 48 Section 7(1) of the Australian Citizenship Act. country was a citizen of that country49. The countries specified were some (but not all) of the Members of the Commonwealth of Nations. They included "the United Kingdom and Colonies"50, which were "deemed to constitute one country"51. The term "alien" was relevantly defined to mean a person who was not a British subject52. Part III of the Australian Citizenship Act provided for the acquisition of Australian citizenship on and from 26 January 1949 to be by birth53, by descent54, by registration55 or by naturalisation56. On and from 26 January 1949 a citizen of a specified country who was thereby a British subject could become an Australian citizen on application through registration, generally after residing in Australia for a period of five years57. But an alien who was not a British subject could become an Australian citizen only through naturalisation58. The Australian Citizenship Act did not ignore the position of persons who had been British subjects under the Nationality Act and who had resided in Australia before 26 January 1949. Part IV was headed "Transitional Provisions". Within Pt IV, s 24 provided: "In this Part, 'British subject' includes a person who was, immediately prior to the date of commencement of this Act, entitled in Australia or a Territory 49 Section 7(1) and (2) of the Australian Citizenship Act. 50 Section 7(2) of the Australian Citizenship Act. 51 Section 5(3)(d) of the Australian Citizenship Act. 52 Section 5(1) (definition of "alien") of the Australian Citizenship Act. 53 Section 10 of the Australian Citizenship Act. 54 Section 11 of the Australian Citizenship Act. 55 Sections 12 and 13 of the Australian Citizenship Act. 56 Sections 14-16 of the Australian Citizenship Act. 57 Section 12(1)(b) of the Australian Citizenship Act. 58 Section 14 of the Australian Citizenship Act. to all political and other rights, powers and privileges to which a natural- born British subject was then entitled." Section 25(1) went on to provide: "A person who was a British subject immediately prior to the date of commencement of this Act shall, on that date, become an Australian citizen he was born in Australia and would have been an Australian citizen if ... this Act had been in force at the time of his birth; he was a person naturalized in Australia; or he had been, immediately prior to the date of commencement of this Act, ordinarily resident in Australia ... for a period of at least five years." No less than Pts II and III, Pt IV of the Australian Citizenship Act was enacted in the exercise of the aliens power. The power that supported the creation of the new status of an Australian citizen to be conferred prospectively by reference to legislatively established criteria supported as well the transitional conferral of that new status by reference to essentially the same criteria. The following statement of the majority in Nolan v Minister for Immigration and Ethnic Affairs59 was restated by the majority in Shaw60: "The transition from Empire to Commonwealth and the emergence of Australia and other Dominions as independent sovereign nations within the Commonwealth inevitably changed the nature of the relationship between the United Kingdom and its former colonies and rendered obsolete notions of an indivisible Crown. A separate Australian citizenship was established by the ... Australian Citizenship Act ... The fact that a person who was born neither in Australia nor of Australian parents and who had not become a citizen of this country was a British subject or a subject of the Queen by reason of his birth in another country could no longer be seen as (1988) 165 CLR 178 at 184. (2003) 218 CLR 28 at 44-45 [37], 87 [190]. having the effect, so far as this country is concerned, of precluding his classification as an 'alien'." The final sentence of that statement is as much applicable to a person who entered Australia before 26 January 1949 and who on 26 January 1949 failed to meet the criteria for the acquisition of Australian citizenship set out in s 25(1) of the Australian Citizenship Act as it is applicable to a person who entered Australia on or after 26 January 1949 and who then and thereafter failed to meet the criteria for the acquisition of Australian citizenship set out in Pt III of the Australian Citizenship Act. The British Nationality and Status of Aliens Act having been repealed on the commencement of the British Nationality Act on 1 January 1949, the appellant's status in Australia as a British subject immediately before the commencement of the Australian Citizenship Act on 26 January 1949 was conferred solely by operation of the Nationality Act. His status in Australia as a British subject on and from 26 January 1949 was conferred solely by operation of the Australian Citizenship Act. The appellant being a person born outside Australia whose parents were not Australians, it was open to the Parliament in the exercise of the aliens power through prescription of the criteria for the conferral of Australian citizenship set out in s 25(1)(d) of the Australian Citizenship Act to deny him the status of an Australian citizen and thereby to treat him as an alien in the transition that occurred on 26 January 1949. The appellant missed out on becoming an Australian citizen on 26 January 1949 through operation of s 25(1)(d) of the Australian Citizenship Act only because, having arrived in Australia on 31 July 1948, he had then been ordinarily resident in Australia for a period of less than five years. His position, however, was not irremediable. After he had resided in Australia for a period of five years – that is, after 31 July 1953 – it was open to him under the Australian Citizenship Act by virtue of his new citizenship of the United Kingdom and Colonies to apply to become an Australian citizen by registration. That course of action remained available to him until the provision for obtaining Australian citizenship by registration was removed from the commencement of relevant provisions of the Australian Citizenship Act 1973 (Cth) the Australian Citizenship Act at on 1 December 197361. His problem is that he did not take that available course of action. The conclusion that the appellant was and remains within the reach of the aliens power can therefore be arrived at, as in Shaw, without need to explore common law notions of allegiance and alienage62 and without attempting to pinpoint the precise time prior to 26 January 1949 when there emerged a distinct Crown in right of Australia63. There is also no need to explore the position before 26 January 1949, touched on in Shaw64, of a person not born within the dominions and allegiance of the Imperial Crown who acquired under local naturalisation legislation in one part of the British Empire the status of a British subject not recognised in other parts65. Even less is there need to re-examine the present position of an Aboriginal Australian according to the tripartite test in Mabo v Queensland [No 2], recently examined in Love v The Commonwealth. Disposition of the appeal The appeal is to be dismissed with costs. 61 Section 2(3) of the Australian Citizenship Act 1973; Commonwealth of Australia Gazette, No 140, 4 October 1973. (2003) 218 CLR 28 at 42-43 [29]. (2003) 218 CLR 28 at 41 [24]. See earlier Victoria v The Commonwealth (Industrial Relations Act Case) (1996) 187 CLR 416 at 477-478; Sue v Hill (1999) 199 CLR (2003) 218 CLR 28 at 39-40 [20]. 65 See Ex parte Lau You Fat (1888) 9 LR (NSW) (L) 269; R v Francis; Ex parte Markwald [1918] 1 KB 617; Markwald v Attorney-General [1920] 1 Ch 348. GORDON J. I agree with Kiefel CJ, Gageler, Keane and Gleeson JJ that, in light of the reasoning of the majority in Shaw v Minister for Immigration and Multicultural Affairs66, this appeal must be dismissed. While I accept that one aspect of the power in s 51(xix) of the Constitution with respect to "naturalization and aliens", as well as of the "immigration" power in s 51(xxvii), is the power to define a concept of "citizenship"67, I remain of the view that Parliament's "power to define, for some purposes, who are members of the Australian community does not constitute a power to define the scope of the aliens power under s 51(xix)"68. The qualification identified by Gibbs CJ in Pochi v Macphee69 that "Parliament cannot, simply by giving its own definition of 'alien', expand the power under s 51(xix) to include persons who could not possibly answer the description of 'aliens' in the ordinary understanding of the word" is important because "[t]o suggest that Parliament has the power, under the aliens power, to define alienage status, risks circularity – it presupposes, as the basis for validity of the law, that the people to whom the law applies are aliens within the constitutional meaning"70. Relatedly, citizenship is a matter that is relevant to alienage, but it is not determinative of alienage71. "Aliens" is a constitutional term, whereas "citizenship" (2003) 218 CLR 28. 67 Love v The Commonwealth (2020) 94 ALJR 198 at 262-263 [325]; 375 ALR 597 68 Love (2020) 94 ALJR 198 at 263 [326]; 375 ALR 597 at 677. (1982) 151 CLR 101 at 109. See also Nolan v Minister for Immigration and Ethnic Affairs (1988) 165 CLR 178 at 186; Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 435-436 [132], 469-470 [238], 490 [297], 491-492 [303]; Re Minister for Immigration and Multicultural Affairs; Ex parte Te (2002) 212 CLR 162 at 173 [31], 175 [39], 205 [159]; Shaw (2003) 218 CLR 28 at 36 [9]; Singh v The Commonwealth (2004) 222 CLR 322 at 329 [4], 382-383 [151], 383 [153]; Koroitamana v The Commonwealth (2006) 227 CLR 31 at 54-55 [81]. 70 Love (2020) 94 ALJR 198 at 263 [327]; 375 ALR 597 at 677. 71 Love (2020) 94 ALJR 198 at 259-261 [303]-[311], especially at 259 [303]; 375 ALR 597 at 672-674, especially at 672. is a purely statutory concept72. "Non-citizen" is not a synonym for "alien"73. It is not the case that, on and from the commencement of the Australian Citizenship Act 1948 (Cth)74 on 26 January 1949, all persons who have not had the status of Australian citizens have been aliens. Indeed, Love v The Commonwealth was to the contrary75. the majority holding It is, however, unnecessary in this case to chart the metes and bounds of the constitutional concept of "alien". Mr Chetcuti was a "natural-born British subject" under the British Nationality and Status of Aliens Act 1914 (UK) by reason of his birth in present day Malta, "within His Majesty's dominions and allegiance"76, and when he arrived in Australia on 31 July 1948 he had the status of a "British subject" under the Nationality Act 1920 (Cth)77. It is sufficient to dispose of this appeal that, in accordance with the majority's reasoning in Shaw78, "[i]t can hardly the relevant political facts and circumstances stood" be said when Mr Chetcuti arrived in Australia in 1948, persons who were British subjects born out of Australia of parents who had not been naturalised in Australia "could not possibly answer the description of aliens in the ordinary understanding of that word". The following aspects of the majority's reasoning in Shaw are both relevant and determinative. that, as First, "[t]he Constitution took effect at a time when 'the Crown' was said to be 'indivisible' and when the common law notion of allegiance to that 'Crown' informed the statutory use of the term 'British subject'"79 (emphasis added). 72 Love (2020) 94 ALJR 198 at 258 [300], 259 [305]; 375 ALR 597 at 671, 672. 73 See Pochi (1982) 151 CLR 101 at 109; Chu Kheng Lim v Minister for Immigration, Local Government and Ethnic Affairs (1992) 176 CLR 1 at 54; Re Patterson (2001) 207 CLR 391 at 435-436 [132], 491 [300]; Ex parte Te (2002) 212 CLR 162 at 179 [53]; Shaw (2003) 218 CLR 28 at 61 [94]; Singh (2004) 222 CLR 322 at 382 [149]-[150]; Love (2020) 94 ALJR 198 at 258 [295], [300], 259-261 [304]-[311], 283-285 [432]-[437]; 375 ALR 597 at 670-674, 703-705. 74 Originally enacted as the Nationality and Citizenship Act 1948 (Cth). (2020) 94 ALJR 198 at 218 [81]; 375 ALR 597 at 616. 76 British Nationality and Status of Aliens Act 1914 (UK), s 1(1)(a). 77 Nationality Act 1920 (Cth), ss 5(1) definition of "British subject" and 6(1)(a). 78 cf (2003) 218 CLR 28 at 40 [22]; see also 42 [27]-[28], 43 [32], 87 [190]. 79 Shaw (2003) 218 CLR 28 at 40-41 [23]. But, "[t]here never was a common law notion of 'British subject' rendered into an immutable element of 'the law of the Constitution'"80. Indeed, in 1900 the term "the Crown" was used in several distinct senses, including "the Crown in right of" a government when identifying the powers of the United Kingdom (the parent state) in relation to its dependencies (the newly created and evolving political units)81. And, in the statute establishing the Australian federation, the Imperial Parliament "unquestionably" treated Australia as a distinct entity82. It is apparent, albeit not explicit, that the majority in Shaw considered that the Constitution itself implicitly recognised that the notion of the "indivisible" Imperial Crown was in a state of flux at federation83. Second, the text of the Constitution "contemplates changes in the political and constitutional relationship between the United Kingdom and Australia" and it is, therefore, "impossible to read the legislative power with respect to 'aliens' as subject to some implicit restriction protective from its reach those who are not Australian citizens but who entered Australia as citizens of the United Kingdom and colonies under the [British Nationality Act 1948 (UK)]"84 (emphasis added). The majority's reference in Shaw to persons entering Australia "as citizens of the United Kingdom and colonies" reflects that Mr Shaw had that status when he entered Australia85; it does not mean that their Honours' reasoning is incapable of applying to a person (like Mr Chetcuti) who entered Australia in 1948, prior to the commencement of the British Nationality Act 1948 (UK), as a "British subject" under the British Nationality and Status of Aliens Act 1914 (UK). As will be explained next, this is because the British Nationality Act 1948 (UK) and the 80 Shaw (2003) 218 CLR 28 at 42 [28]. 81 Shaw (2003) 218 CLR 28 at 40-41 [23]. See also Sue v Hill (1999) 199 CLR 462 82 Shaw (2003) 218 CLR 28 at 40-41 [23], quoting Moore, "The Crown as Corporation" (1904) 20 Law Quarterly Review 351 at 359. See also Sue v Hill (1999) 199 CLR 462 at 501 [90]. 83 See, similarly, Nolan (1988) 165 CLR 178 at 185-186; Sue v Hill (1999) 199 CLR 84 Shaw (2003) 218 CLR 28 at 42 [27]; see also 38 [14], 42 [26], 43 [30]. See also Sue v Hill (1999) 199 CLR 462 at 525 [164]; Re Patterson (2001) 207 CLR 391 (2003) 218 CLR 28 at 35 [3], 38 [15]; see also 73 [130]. Australian Citizenship Act 1948 (Cth) did not, in and of themselves, have any transformative effect in respect of either the relationship between the United Kingdom and Australia, or the divisibility of the Imperial Crown. "The transition from Empire to Commonwealth and the emergence of Australia and other Dominions as independent sovereign nations within the Commonwealth"86 was the result of various constitutional and political changes took place, especially after federation. that The relevant constitutional and political changes included: the Balfour Declaration of the Imperial Conference of 192687; the Statute of Westminster 1931 (UK)88; and negotiations between the governments of the United Kingdom and other Commonwealth citizenship, which culminated in the enactment of the British Nationality Act 1948 (UK) and the Australian Citizenship Act 1948 (Cth)89. nationality countries about and Those changes that had taken place by 1948, and the development and evolution of the relationship between Australia and the United Kingdom, had rendered any notion of an "indivisible" Crown obsolete90. As the majority said in Shaw, it is an "undoubted truth that, by 1948, the Imperial Crown, indivisible in nature, with an undivided allegiance, was no longer apparent, whether in this country or the United Kingdom"91 (emphasis added). Understood in light of those facts and matters, references in the Constitution to "the Queen" must be to the "office" (not to the person)92, and the constitutional term "'subject of the Queen', with its implicit reference to notions of sovereignty, must recognise that at least by 1948 the subjects of the Queen to which reference 86 See Shaw (2003) 218 CLR 28 at 44-45 [37], quoting Nolan (1988) 165 CLR 178 87 Shaw (2003) 218 CLR 28 at 41 [24]. 88 Shaw (2003) 218 CLR 28 at 37-38 [12]-[13]; see also 41 [25]. 89 Shaw (2003) 218 CLR 28 at 38 [17]; see also 39 [18]-[19]. See also reasons of Kiefel CJ, Gageler, Keane and Gleeson JJ at [18]-[22]. 90 Shaw (2003) 218 CLR 28 at 42 [28]; see also 44-45 [37], quoting Nolan (1988) 165 CLR 178 at 184. See also Minister for Works (WA) v Gulson (1944) 69 CLR 338 (2003) 218 CLR 28 at 42 [28]. 92 Shaw (2003) 218 CLR 28 at 38 [14]. was made were subjects of the monarch in right of Australia, not subjects of the monarch in right of the United Kingdom"93 (emphasis added). The British Nationality Act 1948 (UK) and the Australian Citizenship Act 1948 (Cth) put in place new arrangements which "reflected [the] significant changes in the Imperial system which had taken place since federation"94 (emphasis added). Those Acts did not create any fundamental shift in the relationship between the United Kingdom and Australia, nor did their commencement result in the division of the Imperial Crown. And, consistent with the significant changes which had taken place by 1948, the Australian Citizenship Act 1948 (Cth) "[u]ndoubtedly, to a significant degree, ... depended upon the aliens power"95. The expression "British subject" was "not a constitutional expression; [but] a statutory expression"96 in the Australian Citizenship Act 1948 (Cth). It is irrelevant that "British subjects" did not fall within the statutory definition of "alien" in s 5(1) of the Australian Citizenship Act 1948 (Cth) or within the former definition of "[a]lien" in s 5(1) of the Nationality Act 1920 (Cth). By 1948, "British subjects" were aliens in the constitutional sense; albeit a "class of aliens with special advantages in Australian law"97. There is no principled basis for suggesting that the Commonwealth Parliament would have lacked power to enact the Australian Citizenship Act 1948 (Cth) – which, as noted, depended "to a significant degree" upon the aliens power98 – some months earlier than it did, with a commencement date shortly prior to Mr Chetcuti's arrival in Australia. Once that is accepted, it is difficult to see how the commencement of that Act on 26 January 1949, when combined with the significant changes which had taken place by 1948, could be characterised as transforming the constitutional status of British subjects. 93 Shaw (2003) 218 CLR 28 at 40 [20]. See also Re Patterson (2001) 207 CLR 391 94 Shaw (2003) 218 CLR 28 at 38-39 [17]. See also Nolan (1988) 165 CLR 178 at 184; Re Patterson (2001) 207 CLR 391 at 467 [229]. 95 Shaw (2003) 218 CLR 28 at 40 [21]; see also 40 [22]. See also Kenny v Minister for Immigration, Local Government and Ethnic Affairs (1993) 42 FCR 330 at 346. 96 Shaw (2003) 218 CLR 28 at 36 [10]; see also 42 [28]. 97 Shaw (2003) 218 CLR 28 at 40 [22]. 98 Shaw (2003) 218 CLR 28 at 40 [21]. In truth, as the majority in Shaw recognised99, the necessary transformation had already taken place. For these reasons, Mr Chetcuti, like Mr Shaw, arrived in Australia as an "alien" in the constitutional sense and he has not lost that status by reason of his subsequent personal history in Australia100. He did not acquire Australian citizenship automatically under s 25(1) of the Australian Citizenship Act 1948 (Cth) and he did not subsequently apply to become an Australian citizen by registration under s 12(1) of that Act by reason of his citizenship of the United Kingdom and Colonies. It is unnecessary to determine in this case, and the majority in Shaw did not address, whether all persons born outside of Australia of parents who had not been naturalised in Australia, who had entered Australia before 26 January 1949 and who, on that date, did not meet the criteria for the acquisition of Australian citizenship in s 25(1) of the Australian Citizenship Act 1948 (Cth) are "aliens". Indeed, the majority in Shaw focussed on the constitutional and political changes that had taken place by 1948101, being changes to which reference has just been made, and their ultimate conclusion was confined to dealing with persons "who entered this country after ... 26 January 1949"102 (emphasis added). Neither Shaw nor this appeal addressed any larger question. (2003) 218 CLR 28 at 38-39 [17]. See also Nolan (1988) 165 CLR 178 at 184; Re Patterson (2001) 207 CLR 391 at 467 [229]. 100 cf Shaw (2003) 218 CLR 28 at 43 [31]. 101 (2003) 218 CLR 28 at 38 [17], 40 [20], [22], 42 [28]. 102 (2003) 218 CLR 28 at 43 [32]. Edelman Is Mr Chetcuti an alien? Mr Chetcuti was born on 8 August 1945. He arrived in Australia on 31 July 1948 from his birthplace in Malta. He arrived as a British subject. Apart from spending approximately eight months in Malta as a teenager, he has remained in Australia for 73 years. He has voted in local, State, and federal elections. He was registered in the birthday ballot for compulsory military service during the Vietnam war. He was employed for seven years as a teacher by the New South Wales Education Department. And he has spent 24 years in an Australian prison for murder. In 2017, as a result of his conviction and sentence of imprisonment in 1993, the Minister for Immigration and Border Protection purported to cancel Mr Chetcuti's Absorbed Person visa under s 501 of the Migration Act 1958 (Cth), following which Mr Chetcuti was detained in immigration detention under s 189 of the Migration Act pending removal to Malta. In his claim before the primary judge in this Court, Mr Chetcuti sought relief including a declaration that his detention was unlawful, a declaration that he is not an alien within s 51(xix) of the Constitution, and damages for false imprisonment. The primary judge rejected Mr Chetcuti's claim. This appeal concerns whether Mr Chetcuti falls within the scope of the constitutional meaning of "alien" in s 51(xix) of the Constitution and therefore whether he is within the application of the Migration Act such that he can lawfully be detained or removed from Australia. Mr Chetcuti submits that (i) he arrived in Australia as a British subject outside the constitutional conception of alien and (ii) his non-alien status continued as he became a subject of the Queen of Australia upon the bifurcation of the Crown, in effect rendering his status almost indelible so that, absent renunciation, he could never fall within the meaning of an "alien" in s 51(xix). The unchanging, essential meaning of an "alien" in s 51(xix) of the Constitution is a foreigner to the Australian political community. But the application of this meaning, like the application of the meaning of all constitutional terms, can change over time. The application can be affected by changes in political and social facts and circumstances. Based on the political and social facts and circumstances of 1948, there is some force in the first aspect of Mr Chetcuti's submission. In 1948, when Mr Chetcuti arrived in Australia as a British subject, no legislation existed recognising Australian citizenship. The Nationality Act 1920 (Cth) defined an "alien" as "a person who is not a British subject"103. At that time, many Australians may have been surprised by a suggestion, consistently with one of the Commonwealth's submissions, that the Commonwealth had power to treat a British subject as an alien, particularly where the British subject: was living 103 Nationality Act 1920 (Cth), s 5(1). Edelman in Australia; was eligible for a passport; and, when old enough, was eligible to vote in Australian elections, to be elected to the Commonwealth Parliament, and to be conscripted to fight wars. There is less force in the second aspect of Mr Chetcuti's submission, which requires consideration of the application of the constitutional meaning of "alien" according to the political and social facts and circumstances since 2017. In Pochi v Macphee104, this Court rejected the notion that an alien could become a non-alien by absorption into the Australian community. That conclusion was not challenged on this appeal, so matters such as the length of Mr Chetcuti's stay in Australia and the strength of any of his general bonds to the community must be put to one side. That leaves for consideration Mr Chetcuti's submission that, in the application of the constitutional meaning of "alien" since 2017, the Commonwealth Parliament has no power to treat him as an alien even though: he is a Maltese citizen; he has never been a citizen of Australia; he was not born in Australia; and he does not have Australian parents. This Court has previously been confronted with cases where the parties' submissions raised the two issues of (i) a person's status upon arrival in Australia and (ii) that person's status as at a relevant later time. In Sue v Hill 105, a majority of this Court decided the case on the basis that whatever the status of Ms Hill was when she migrated to Australia from the United Kingdom in 1971, as at the time of her nomination for election as a senator for the State of Queensland on 4 September 1998 her British citizenship meant that she was a subject or citizen of a foreign power within the meaning of s 44(i) of the Constitution. By contrast, in Shaw v Minister for Immigration and Multicultural Affairs106, a majority of this Court decided the case on the basis that when Mr Shaw arrived in Australia as a British subject on 17 July 1974 he fell within the scope of the aliens power in s 51(xix) of the Constitution, which extended at least to people who had entered Australia on or after 26 January 1949 and who were born outside of Australia to parents who were not Australian citizens. There was no suggestion that any change in political or social facts or circumstances since 17 July 1974 had removed Mr Shaw from the scope of the aliens power. In the present appeal, the only question that needs to be decided is whether Mr Chetcuti was a constitutional alien at the time at which he is said to fall within the application of the Migration Act. Whatever his status might have been almost seven decades earlier upon his arrival in Australia, that status was not 104 (1982) 151 CLR 101 at 111. See also Cunliffe v The Commonwealth (1994) 182 CLR 272 at 295. 105 (1999) 199 CLR 462 at 503 [97], 529 [176]. 106 (2003) 218 CLR 28 at 43 [32], 87 [190]. Edelman cryogenically frozen and impervious to the application of the Constitution to new political and social facts and circumstances. In light of the many changes in political and social facts and circumstances since 31 July 1948, the contemporary application of the aliens power in s 51(xix) of the Constitution leads to the conclusion that Mr Chetcuti was within the scope of the aliens power at least from The meaning of "alien" in s 51(xix) of the Constitution Essential meaning and application Putting to one side the effect of judicial decisions and other constitutional practices that, metaphorically, "divert[] the flow of constitutional law into new channels"107, for more than a century it has been "beyond controversy"108 or "beyond question"109 that, whilst the application of the terms of the Constitution might change, the essential meaning or, perhaps less accurately, the "connotation" of a constitutional term cannot change: "whatever it meant in 1900 it must mean so long as the Constitution exists"110. As Windeyer J said, and as has been reiterated numerous times subsequently in this Court111: "We must not, in interpreting the Constitution, restrict the denotation of its terms to the things they denoted in 1900. The denotation of words becomes enlarged as new things falling within their connotations come into existence or become known. But in the interpretation of the Constitution the connotation or connotations of its words should remain constant." 107 Victoria v The Commonwealth ("the Payroll Tax Case") (1971) 122 CLR 353 at 108 King v Jones (1972) 128 CLR 221 at 229. 109 Lansell v Lansell (1964) 110 CLR 353 at 366. 110 R v Barger (1908) 6 CLR 41 at 68. See also Andrews v Howell (1941) 65 CLR 255 at 278; Australian Communist Party v The Commonwealth (1951) 83 CLR 1 at 195, 199, 274; Attorney-General (Vict); Ex rel Black v The Commonwealth (1981) 146 CLR 559 at 578. 111 Ex parte Professional Engineers' Association (1959) 107 CLR 208 at 267. See also Street v Queensland Bar Association (1989) 168 CLR 461 at 537; McGinty v Western Australia (1996) 186 CLR 140 at 200; Eastman v The Queen (2000) 203 CLR 1 at 45 [142]-[143]; Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at Edelman Since the Constitution is a foundational document which was intended to endure "for the continued life and progress of the community"112, the essential meaning of a constitutional term should be expressed at a level of generality, and with sufficient abstraction from specific detail, to permit the term to be applied to new circumstances and with the benefit of developed understandings with due fidelity to the unchanged purposes underlying both the term and the Constitution. Hence, when interpreting the meaning of the term "foreign power" in s 44(i) of the Constitution, that expression has been accurately understood as "an abstract concept apt to describe different nation states at different times according to their circumstances"113. As McHugh J said in Re Patterson; Ex parte Taylor114, "[t]his method of interpretation is equally applicable to the term 'aliens' in s 51(xix) of the Constitution". If the meaning of "alien" were defined at too granular a level of generality then the flexibility needed for its application over the long-term operation of the Constitution would be undermined. Such a granular definition would frustrate the long-term fulfilment of the purpose of the power conferred upon Parliament over both naturalisation and aliens. When the term "alien" in s 51(xix) is interpreted at the appropriate level of generality, both as a matter of etymology115 and as a matter of legal meaning116, it means a person who does not belong to the Australian political community. As Griffith CJ said in Potter v Minahan117, "every human being (unless outlawed) is a member of some community, and is entitled to regard the part of the earth occupied by that community as a place to which he may resort when he thinks fit". But although the meaning of "alien" can be simply stated, this 112 The Commonwealth v Kreglinger & Fernau Ltd and Bardsley (1926) 37 CLR 393 113 Sue v Hill (1999) 199 CLR 462 at 524-525 [162]. 114 (2001) 207 CLR 391 at 427 [111]. 115 Love v The Commonwealth (2020) 94 ALJR 198 at 208 [18], 215 [61]; 375 ALR 116 Love v The Commonwealth (2020) 94 ALJR 198 at 259 [302], 276 [403]; 375 ALR 117 (1908) 7 CLR 277 at 289. Edelman case is yet another demonstration of the difficulty in the application of that meaning, as it evolves over time, in relation to British subjects118. Alienage cannot be applied solely by reference non-citizenship to non-allegiance or The meaning of "alien" in s 51(xix) does not correspond precisely with the concepts of either (i) non-subjecthood or non-allegiance or (ii) non-citizenship. To set the meaning by reference to either non-allegiance or non-citizenship would be to ascribe too narrow a scope for the evolution of application of that constitutional term. It is necessary to reiterate why "alien" was not, and is not, the simple antonym of either (i) a person who, as a subject, owes allegiance to the relevant sovereign or (ii) a person who is an Australian citizen. One stable, but overly narrow, essential meaning of "alien" might have been that taken by Quick and Garran, who asserted in 1901 that an alien was "a person who owes allegiance to a foreign State, who is born out of the jurisdiction of the Queen, or who is not a British subject"119. On that approach, every British subject, born in a Dominion, who did not owe a foreign allegiance, was a non-alien. Similarly, in his dissenting judgment in Singh v The Commonwealth120, McHugh J said that "the essential meaning – the connotation – of the term 'alien' was a person who did not owe permanent allegiance to the Crown". That essential meaning should not be adopted. To ascribe to the term "alien" the essential meaning of "non-subject" or, at an even greater level of specificity, "non-subject of the Queen" or "person not owing permanent allegiance to the Crown", would be to define the term at too great a level of specificity. Norms concerning subjecthood and allegiance were in a state of flux at the time of Federation, particularly due to the Royal Commission in 1868121. As the joint judgment in Shaw said, "[t]here never 118 See also Nolan v Minister for Immigration and Ethnic Affairs (1988) 165 CLR 178; Re Patterson; Ex parte Taylor (2001) 207 CLR 391; Shaw v Minister for Immigration and Multicultural Affairs (2003) 218 CLR 28. 119 Quick and Garran, The Annotated Constitution of the Australian Commonwealth 120 (2004) 222 CLR 322 at 343 [38]. 121 Great Britain, Report of the Royal Commissioners for Inquiring into the Laws of Naturalization and Allegiance (1869). See also In re Stepney Election Petition; Isaacson v Durant (1886) 17 QBD 54; Parry, British Nationality (1951) at 7; Parry, Nationality and Citizenship Laws of The Commonwealth and of The Republic of Ireland (1957) at 78-79. Edelman was a common law notion of 'British subject' rendered into an immutable element of 'the law of the Constitution'"122. The early understandings of how "alien" would be applied, and the early applications by this Court, were inconsistent with such an essential meaning that equated "alien" merely with a person not owing permanent allegiance to the Crown. Those applications in the Convention debates and in early decisions of this Court were underpinned by the very slippery, perhaps incoherent, notion of race even of persons who owed permanent allegiance to the Crown123. Hence, in Shaw, Heydon J, a member of the majority, observed that "[i]t is not in fact self-evident that from 1 January 1901 all British subjects were not aliens, and inquiry into a subsequent date on which, or process by which, they became aliens tends to proceed on a false footing so far as it excludes the possibility that on 1 January 1901 some of them were aliens"124. An example of the way in which the slippery, possibly incoherent, notion of race underpinned this Court's understanding of the concept of alienage is the decision in Robtelmes v Brenan125. The question before the Court was whether any head of power, including s 51(xix), of the Constitution supported s 8 of the Pacific Island Labourers Act 1901 (Cth), which permitted the deportation from Australia of all Pacific Island labourers whose employment had concluded. Griffith CJ said of Pacific Islanders, including the appellant in that case, that "[t]hey are aliens; that is indisputable"126. Barton J also said that it was "undeniable" that the aliens power extended to deporting Pacific Islanders127. And O'Connor J began his judgment by comparing the exclusion of Pacific Islanders with the exclusion of those who were ethnically Chinese as aliens, in each case without regard to whether they were British subjects128. This decision was reached by application of the concept of alienage through a racial lens, irrespective of considerations of British subjecthood. As Dr Prince observed of the racially based approach taken by this 122 (2003) 218 CLR 28 at 42 [28]. 123 Love v The Commonwealth (2020) 94 ALJR 198 at 276-278 [404]-[409]; 375 ALR 124 (2003) 218 CLR 28 at 87 [190]. 125 (1906) 4 CLR 395. 126 (1906) 4 CLR 395 at 403. 127 (1906) 4 CLR 395 at 415. 128 (1906) 4 CLR 395 at 417. Edelman Court129, many Pacific Islanders were British subjects, including Torres Strait Islanders, those from British colonies such as Fiji and, after 1888, British New Guinea. And many others came from British protectorates such as the Solomon Islands and the Gilbert Islands or had been born in Queensland or married British subjects. Although British subjecthood, embodying allegiance to the Queen, did not control the meaning of the term "alien" in s 51(xix), that concept nevertheless had a substantial effect on the early application of the meaning of "alien" as a person who is a foreigner to the Australian political community. The effect of allegiance on the application of the meaning of "alien" began to fade after the commencement of the Nationality and Citizenship Act 1948 (Cth) ("the 1949 Act")130. As I explained in Love v The Commonwealth131 by reference to the observations of Professor Parry, the 1949 Act was said to have had the effect that the concept of allegiance was "altogether swept away, together with all other rules of the common law respecting nationality". Any suggestion that the essential meaning of "alien" is "non-citizen" has far less to commend it. In 1902, Salmond wrote that "[t]here are citizens in France and in the United States of America, but the law and language of England know of subjects only"132. The founders of the Constitution had also consciously rejected any constitutional notions of citizenship, in part because of the uncertainty of that concept133. As Barton explained, "'[c]itizens' is an undefined term, and is not 129 Prince, "'Australia's Most Inhumane Mass Deportation Abuse': Robtelmes v Brenan and Expulsion of the 'Alien' Islanders" (2018) 5(1) Law and History 117 at 133-134. 130 Subsequently renamed as the Australian Citizenship Act 1948 (Cth) before being repealed and replaced by the Australian Citizenship Act 2007 (Cth): see Australian Citizenship (Transitionals and Consequentials) Act 2007 (Cth), Sch 1, item 42. 131 (2020) 94 ALJR 198 at 282-283 [430]; 375 ALR 597 at 703, referring to Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 441-442 [151]. 132 Salmond, "Citizenship and Allegiance" (1902) 18 Law Quarterly Review 49 at 49. 133 Love v The Commonwealth (2020) 94 ALJR 198 at 283-284 [434]; 375 ALR 597 at 704, referring, amongst other matters, to Official Record of the Debates of the Australasian Federal Convention (Melbourne), 3 March 1898 at 1788, 1797, Official Record of the Debates of the Australasian Federal Convention (Melbourne), 8 February 1898 at 677, 2 March 1898 at 1751, and Official Record of the Debates of the Australasian Federal Convention (Melbourne), 2 March 1898 at 1761. Edelman known to the Constitution"134. Although, as explained below, norms of citizenship can have a strong effect on the application of the meaning of an "alien", to re-define the essential meaning of "alien" as "non-citizen" would effectively be a judicial amendment to the Constitution. It would also be contrary to basic constitutional principle. In Love v The Commonwealth135, multiple members of this Court acknowledged the existence of a constitutional limit upon the extent to which Parliament could affect the meaning of "alien" by legislation. This limit, which Gibbs CJ (with whom Mason and Wilson JJ agreed) had earlier regarded as clear in Pochi v Macphee136 and which many other members of this Court have reiterated137, was that the Commonwealth Parliament cannot "simply by giving its own definition of 'alien', expand the power under s 51(xix) to include persons who could not possibly answer the description of 'aliens' in the ordinary understanding of the word". Whether such Commonwealth legislation involves a definition of "alien" or a definition of "citizen", the limit ensures that it is for the judiciary, and not for Parliament, to provide the final interpretation and application of the meaning of the Constitution. This is the principle of law recognised in Marbury v Madison138 that is deeply embedded in the foundations of the Constitution. In Love v The Commonwealth139, as in this case, the Solicitor-General of the Commonwealth gave an example of a person who, whatever their status under statutory citizenship laws, would be beyond the aliens power due to the strength of that person's connection with the Australian political community. His example, which should be accepted as correct, is a person born in Australia, to two parents 134 Official Record of the Debates of the Australasian Federal Convention (Melbourne), 3 March 1898 at 1786. 135 (2020) 94 ALJR 198 at 206 [7], 212 [50], 233 [168], 243 [236], 260 [310], 283 [433], 291 [466]; 375 ALR 597 at 600, 609, 636, 651, 673-674, 703-704, 714-715. 136 (1982) 151 CLR 101 at 109. 137 Nolan v Minister for Immigration and Ethnic Affairs (1988) 165 CLR 178 at 185-186; Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 435-436 [132], 469-470 [238], 490 [297], 491-492 [303]; Shaw v Minister for Immigration and Multicultural Affairs (2003) 218 CLR 28 at 36 [9]; Singh v The Commonwealth (2004) 222 CLR 322 at 329 [4], 382-383 [151]; Koroitamana v The Commonwealth (2006) 227 CLR 31 at 54-55 [81]. 139 (2020) 94 ALJR 198 at 273 [395], 286-287 [444]; 375 ALR 597 at 691, 708. Edelman who are Australian citizens, who is not a citizen of another country, and who has not renounced their allegiance to Australia. Another example, recognised by a majority of this Court in Love v The Commonwealth, is Aboriginal Australians. In Pochi v Macphee, Gibbs CJ considered that the limit on Parliament's ability to legislate over aliens would not be exceeded if Parliament treated as an alien a person who was born outside Australia, to parents who were not "Australians", and who had not been naturalised as an "Australian"140. The Chief Justice was not considering the position of Aboriginal Australians. Rather, his point, correctly made, was that the meaning of a constitutional term is not dictated by the fluctuating content of legislation on a related subject. Even putting to one side the error in defining the essential meaning of a constitutional term ("alien") by reference to a notion that (i) at best, was little understood and was evolving at Federation and (ii) conflates constitutional meaning with an exercise of legislative power (ie the statutory rules governing persons who are eligible to be citizens), there is a degree of circularity in treating a constitutional power to legislate over aliens as co-extensive with, and defined by, a power to legislate over anyone who is not a citizen. The power to legislate over citizens is itself derived "to a significant degree"141 from the constitutional power with respect to aliens142. Hence, the Commonwealth Parliament could not recite itself into power by using the Australian Citizenship Act 2007 (Cth) to deny citizenship to "every Aboriginal Australian ... or ... every descendant of Australians of Chinese (or other) ethnicity"143 and thereby acquire power over these groups under the aliens power. Nor is the grant of statutory citizenship a constitutional ratchet so that, unless a person renounces their citizenship, the grant under statute of citizenship becomes irrevocable, taking the person beyond the power over naturalisation and aliens. In short, the meaning of "alien" in the Constitution is not, and has never been, "any person who has not received Australian citizenship". Instead, the constitutional meaning requires a "search ... for the essential character 140 (1982) 151 CLR 101 at 109-110. 141 Shaw v Minister for Immigration and Multicultural Affairs (2003) 218 CLR 28 at 142 See also Love v The Commonwealth (2020) 94 ALJR 198 at 283 [433]; 375 ALR 597 at 704, citing Hwang v The Commonwealth (2005) 80 ALJR 125 at 128 [10]; 222 ALR 83 at 86-87 and Singh v The Commonwealth (2004) 222 CLR 322 at 143 Shaw v Minister for Immigration and Multicultural Affairs (2003) 218 CLR 28 at Edelman of the constitutional idea of alienage"144. That essential character is absence of membership of the Australian political community. Norms that influence the application of the aliens power Although neither non-allegiance nor non-citizenship is part of the essential meaning of "alien" and hence neither can dictate whether or not a person can be treated as falling outside the membership of the Australian political community, the scope of application of the aliens power over time has been heavily influenced by the concept of allegiance and, later, the concept of citizenship, particularly a person's place of birth (ius soli) and the citizenship of a person's parents (ius sanguinis)145. The aliens power is also a partial source for the power to create statutory citizenship, which, in turn, assists to define the membership of the Australian political community. At the time of Federation, the concepts of allegiance and subjecthood were powerful factors in the application of whether a person was a member of the Australian political community, notwithstanding that the concept of allegiance was complicated by a strong racial lens through which it was initially understood and applied. On this appeal, Mr Chetcuti relied heavily upon the concept of allegiance to assert that since he had arrived in Australia as a British subject with an allegiance to the Crown, and since (as he claimed) the Crown had not yet divided, he could not have been an alien when he arrived in Australia. The submissions of the parties therefore attempted to identify a point in time at which Australia achieved independence from the United Kingdom. These reasons follow the approach of the parties, but three points should be emphasised. First, there is no magic date when independence was suddenly achieved by Australia. The move towards independence had a slow and incremental character. It is an example of "the gradualness, the extreme gradualness, of inevitability"146. Secondly, although the relevant date in Shaw was said to be at the latest 26 January 1949, it is arguable that the Crown had divided earlier, so that by the time Mr Chetcuti arrived in Australia on 31 July 1948 he arrived as a British subject to a country where the sovereign had separate identity in relation to Australia. But the further back that a date on which Australian independence, and the division of the Crown, is said to have occurred, the more care must be taken that history is not being revised contrary to the political and social facts and 144 Shaw v Minister for Immigration and Multicultural Affairs (2003) 218 CLR 28 at 145 See Love v The Commonwealth (2020) 94 ALJR 198 at 285-287 [441]-[446]; 375 ALR 597 at 706-708. 146 R v Hush; Ex parte Devanny (1932) 48 CLR 487 at 518. Edelman circumstances at the time. Thirdly, and in any event, allegiance was only a factor in the application of the meaning of "alien". The factors governing the application of constitutional meaning can change over time. From 26 January 1949, the factor of allegiance began to be overtaken by a focus on citizenship. Australian independence and the absence of any magic date There is no magic date when, like Cinderella at midnight, all British subjects who had no other connection to Australia which was capable of taking them outside s 51(xix) suddenly became capable of being treated as aliens in Australia. Rather, the process of Australian independence from the United Kingdom, as the special case before the primary judge pointed out in painstaking detail, involved incremental development marked by a number of significant political and legal steps following Federation in 1901. The incremental development was, in large part, political. In 1917, a constitutional resolution at the Imperial War Conference recognised that readjustment of the constitutional recognition of the different parts of the British Empire should be based upon "a full recognition of the Dominions as autonomous nations of an Imperial Commonwealth". On 30 July 1918, the Imperial War Cabinet resolved that the Prime Ministers of the Dominions "have the right of direct communication with the Prime Minister of the United Kingdom and vice versa". That resolution was described the same year by Pollock as the beginning of "the building" of a new constitution which would treat the Dominions as "partners on an equal footing"147. Following the Treaty of Versailles, Viscount Grey described the "self-governing Dominions" as "free communities, independent as regards all their own affairs, and partners in those that concern the Empire at large"148. At the Imperial Conference of 1930 it was resolved that the King would act in appointing a Governor-General of a Dominion by advice of his Ministers in the Dominion concerned. In 1931, when Sir Isaac Isaacs was appointed as the Governor-General of Australia under s 2 of the Constitution, the appointment was therefore made by the King on the advice of his Australian Ministers. 147 Pollock, "Notes: The League of Nations" (1918) 34 Law Quarterly Review 344 at 148 "Occasional Notes" (1920) 149 The Law Times 200 at 200. Edelman Part of this political evolution was the gradual recognition of the division of the Crown with respect to the Commonwealth of Australia149. On 28 June 1919, the Treaty of Versailles was signed on behalf of the British Empire but also contained indented signatures for the Dominions, including a signature for the Commonwealth of Australia by the Prime Minister and Minister for the Navy. In 1926, the Balfour Declaration declared the Dominions to be "autonomous Communities within the British Empire, equal in status, in no way subordinate one to another ... though united by a common allegiance to the Crown, and freely associated as members of the British Commonwealth of Nations"150. Other aspects of the Balfour Declaration were less clear in their recognition of Australian independence151. It might be said that, although the Balfour Declaration was the "declaration of independence" of the Dominions, the Imperial Conference "recognised that this principle was still not reflected in reality"152. At that time there also remained strongly held views of the unity of the Crown153. However, the recognition of Her Majesty as the Queen of Australia in the Royal Style and Titles Act 1973 (Cth)154 was a formal recognition of a division of the Crown in relation to Great Britain and the Commonwealth of Australia155. Despite these large strides in political theory towards Australian independence, there was still a substantial degree of practical integration between Australia and the United Kingdom at the time that the 1949 Act came into effect on 26 January 1949. Immediately prior to that date, there was no statutory concept of an Australian citizen. At that time, Australian passports could be issued to 149 Compare the different evolution of the arguably independent Crown in relation to the States discussed in Twomey, The Australia Acts 1986: Australia's Statutes of Independence (2010) at 461-472. 150 Imperial Conference, Summary of Proceedings (1926) at 10. 151 Winterton, "The Evolution of a Separate Australian Crown" (1993) 19 Monash University Law Review 1 at 7-8. 152 Twomey, "Sue v Hill – The Evolution of Australian Independence", in Stone and Williams (eds), The High Court at the Crossroads: Essays in Constitutional Law 153 See Winterton, "The Evolution of a Separate Australian Crown" (1993) 19 Monash University Law Review 1 at 13-16, referring to the views of Berriedale Keith, Leo Amery, Sir Robert Garran, Sir Cecil Hurst, Sir John Latham, and Philip Noel Baker. 154 Passed in accordance with s 58 of the Constitution. 155 Southern Centre of Theosophy Inc v South Australia (1979) 145 CLR 246 at 261. Edelman British subjects156 and a relevant qualification for election to the House of Representatives was that the person "must be a subject of the King, either natural born or for at least five years naturalized under a law of the United Kingdom or of the Commonwealth"157. Even after 26 January 1949, when statutory qualifications for election were amended on 22 April 1949, this requirement was replaced with a requirement that the person "must be a British subject"158. And the issue of Australian passports remained possible for British subjects who were not Australian citizens159. Further, although Australia might in theory have had the power to make a declaration of war160, on 3 September 1939 Prime Minister Menzies announced that Great Britain was at war with Germany and that "as a result, Australia is also at war". On the other hand, on 9 December 1941 Prime Minister Curtin independently announced that Australia had declared war against the Japanese Empire following accession by the King the previous day to the Prime Minister's request for assignment to the Governor-General of the power to declare and proclaim a state of war between the Commonwealth of Australia and Finland, Hungary, Rumania, and the Japanese Empire161. Apart from the legislation already discussed, the incremental development of Australian sovereignty over this period also included: the Nationality Act 1920 (Cth); the Commonwealth Public Service Act 1922 (Cth); the Statute of Westminster 1931 (UK); and the Aliens Deportation Act 1946 (Cth). These legislative steps to complete independence were arguably not wholly concluded until the passage of the Australia Acts 1986 (Cth and UK). But a significant legislative step, which was the focus of this appeal, was the enactment of the 1949 Act. 156 Passports Act 1938 (Cth), s 7(1). 157 Commonwealth Electoral Act 1918 (Cth), s 69(1)(b), as amended by Commonwealth Electoral Act 1925 (Cth), s 4. See also Constitution, s 34. 158 Commonwealth Electoral Act 1918 (Cth), Commonwealth Electoral Act 1949 (Cth), s 5(a). s 69(1)(b), as amended by 159 Passports Act 1938 (Cth), s 7(1), as amended by Passports Act 1948 (Cth), s 4. 160 Compare Twomey, "Sue v Hill – The Evolution of Australian Independence", in Stone and Williams (eds), The High Court at the Crossroads: Essays in Constitutional Law (2000) 77 at 86. 161 Commonwealth of Australia Gazette, No 104, 7 April 1942 at 859. Edelman The 1949 Act and the Shaw decision As explained earlier in these reasons, in Shaw a majority of this Court held that British subjects who entered Australia as citizens of the United Kingdom and colonies after the 1949 Act took effect, and who had not fulfilled the criteria to be Australian citizens, were capable of being treated as falling within s 51(xix) as aliens to the Australian community. No party challenged that conclusion, although Mr Chetcuti submitted that the date could not be pushed further back from 26 January 1949 to the date of his arrival on 31 July 1948. The genesis of the 1949 Act was the British Commonwealth Conference on Nationality and Citizenship in February 1947, which itself had followed consideration in 1945 of the creation of Australian citizenship and the creation of Canadian citizenship in 1946162. The Report of that conference recorded the general view of the conference that it would be desirable to adopt a scheme of legislation which combined two matters: first, the ability of each country to determine who are its citizens; and secondly, the maintenance of the common status of British subjects throughout the Commonwealth by recognition of the citizens of particular countries of the Commonwealth as British subjects163. Most Commonwealth countries subsequently adopted this model in domestic legislation. Consistently with this model, the 1949 Act created the new concept of an Australian citizen, with citizenship broadly arising from categories of birth, descent, registration, and naturalisation164, and with Australian citizenship being lost in circumstances including the acquisition of foreign citizenship165. There were express assurances in the second reading speech of the 1949 Act that British subjects would "continue to be free from the disabilities and restrictions that apply to aliens"166. Section 5(1) of the 1949 Act defined an alien as a "person who is not a British subject, an Irish citizen or a protected person". By s 7, which was common 162 See Australia, House of Representatives, Parliamentary Debates (Hansard), 30 September 1948 at 1060, 1062 and the Canadian Citizenship Act 1946 (Can). 163 British Commonwealth Conference on Nationality and Citizenship (London, February 1947): Report with Appendices (1947) at 3 [8]-[9]. 164 See Love v The Commonwealth (2020) 94 ALJR 198 at 285 [441]; 375 ALR 597 at 165 Nationality and Citizenship Act 1948 (Cth), s 17. 166 Australia, House of Representatives, Parliamentary Debates (Hansard), 30 September 1948 at 1062. Edelman to the model applied by most Commonwealth countries that adopted the model167, a person was a British subject if the person was an Australian citizen or, by an enactment in a relevant country, was a citizen of that country. The relevant countries were: the United Kingdom and colonies, Canada, New Zealand, the Union of South Africa, Newfoundland, India, Pakistan, Southern Rhodesia, and Ceylon168. The 1949 Act contained a transitional provision, s 25, which, subject to an exception not presently relevant, conferred Australian citizenship on all British subjects who: (i) were born in Australia and would have been an Australian citizen under s 10 at the time of birth if that section had been in force; (ii) were born in New Guinea; (iii) were naturalised in Australia; or (iv) had been, immediately prior to the date of commencement of the 1949 Act, ordinarily resident in Australia or New Guinea (or partly resident in both), for a period of at least five years. The gap in the transitional provision meant that not all British subjects became Australian citizens. In broad terms, the new Australian citizenship was not automatically conferred upon British subjects who had migrated to Australia less than five years before 26 January 1949. Those persons could become Australian citizens only by registration, subject to conditions including at least five years of residence in Australia169. British subjects could not be naturalised. Naturalisation was reserved for aliens or protected persons170. Despite the gap in the transitional provision, and consistently with the intention of the 1949 Act that British subjects would continue to be free from the restrictions that applied to aliens, those British subjects who were not Australian citizens could still be issued with Australian passports171. Indeed, approximately a decade after the 1949 Act, the legislation was still seen as not having had the effect 167 Parry, Nationality and Citizenship Laws of The Commonwealth and of The Republic of Ireland (1957) at 93. 168 1949 Act, s 7(2). 169 1949 Act, s 12(1)(b). 170 1949 Act, s 14(2). 171 Passports Act 1938 (Cth), s 7(1), as amended by Passports Act 1948 (Cth), s 4. Edelman of making any British subject an alien. As Professor Parry observed in 1957 of the s 7 common clause172: "And though not every country of the Commonwealth has enacted this clause [(ie not South Africa or Ceylon)], the situation has at least been produced that no citizen of any country of the Commonwealth is an alien in any other. Where, therefore, under the law of any such country, the distinction between subject and alien – or between non-alien and alien – is drawn, the British subject who is not a local citizen, equally with the local citizen, is not to be classed as an alien." Professor Parry concluded that the introduction of local citizenship in Commonwealth countries "did not of itself prejudice the non-citizen [British] subject", but he observed that "this is a situation which cannot remain constant"173. The conclusion of the majority of this Court in Shaw – that British subjects were capable of being treated as aliens within s 51(xix) of the Constitution since the 1949 Act took effect on 26 January 1949 – did not, however, rest upon the erroneous premise that the content of the constitutional term "alien" had been defined by the new legislative creation of Australian citizenship by the 1949 Act. Instead, referring to the list of Commonwealth countries from which people might be British subjects, the joint judgment in Shaw said that it could "hardly be said that, as the relevant political facts and circumstances stood in 1948, those citizens could not possibly answer the description of aliens in the ordinary understanding To express the conclusion of the majority in Shaw in other words, their Honours were saying that by at least the time the 1949 Act took effect the prior political and social facts and circumstances were such that the 1949 Act could combine with those facts and circumstances with the effect that all British subjects who did not otherwise have any strong connection to Australia to take them outside s 51(xix) were capable of being treated as aliens. Contrary to the views that Professor Parry had expressed approximately a decade after the commencement of the 1949 Act, the combination of political and social facts and circumstances in Australia's progression to independence had coalesced at the latest by 26 January 1949 to such a degree of independence that from at least that date 172 Parry, Nationality and Citizenship Laws of The Commonwealth and of The Republic of Ireland (1957) at 93. 173 Parry, Nationality and Citizenship Laws of The Commonwealth and of The Republic of Ireland (1957) at 94. 174 (2003) 218 CLR 28 at 40 [22]. Edelman British subjecthood, by itself, was not a sufficient basis to resist being treated as an alien. The dangers of revisionist history It can be accepted that from 26 January 1949 the relevant political and social facts and circumstances meant that, without other factors to take them outside s 51(xix), all British subjects were capable of being treated as aliens within s 51(xix) of the Constitution. But as this date is pushed back further – the Commonwealth's alternative submissions being 1942, 1931, 1926, or 1901 – there is a corresponding increase in the likelihood of this Court retrospectively revising the historical political and social facts and circumstances that determined those who fell outside the conception of an alien at the time in question. The notion of an Australian political community existed long before statutory citizenship came into existence in 1949. It is in this sense of an independent Australian political community that, from the time of Federation and long before the concept of Australian citizenship had been legislated, members of this Court spoke loosely of "Australian citizens"175 to describe what Isaacs J called "the community known as the Australian people"176. In the early years after Federation, that conception was one that was strongly associated with British subjecthood and was not generally distinguished from it, albeit that the membership of the Australian political community was sometimes applied through a racial lens. This Court said in 1906 that it was not "disposed to give any countenance to the novel doctrine that there is an Australian nationality as distinguished from a British nationality"177. But in 1929 it was observed in the Report of the Conference on the Operation of Dominion Legislation that the common status as a British subject "is in no way inconsistent with the recognition within and without the Commonwealth of the distinct nationality possessed by the nationals of the individual states of the British Commonwealth"178. And, as 175 R v Sutton (1908) 5 CLR 789 at 807; The Commonwealth v Kreglinger & Fernau Ltd and Bardsley (1926) 37 CLR 393 at 414; Ex parte Nelson [No 2] (1929) 42 CLR 258 at 275; Gonzwa v The Commonwealth (1944) 68 CLR 469 at 476; Attorney-General (Vict) v The Commonwealth (1945) 71 CLR 237 at 276. 176 Potter v Minahan (1908) 7 CLR 277 at 308. 177 Attorney-General for the Commonwealth v Ah Sheung (1906) 4 CLR 949 at 951. 178 Report of the Conference on the Operation of Dominion Legislation and Merchant Shipping Legislation, 1929 (1930) Cmd 3479 at 25 [78]. The Australian representatives at the Conference were Sir William Harrison Moore and Major Casey. Edelman discussed above, from the time that the 1949 Act took effect the relevance of British nationality and the concept of allegiance were, at least, in steep decline. In the early stages of the inexorable progression towards Australian independence from the United Kingdom, and whether or not through the racial lens with which the Australian political community was often seen at that time, it would have been thought absurd to suggest that all British subjects could be treated as foreigners to the Australian political community; that is, as aliens within s 51(xix) of the Constitution. But it is unnecessary in this case to ask how much earlier than 26 January 1949, if at all, a British subject could be treated by the Commonwealth Parliament as an alien within s 51(xix). The reason it is unnecessary to ask that question in this case, and the reason it may be unnecessary to ask it in any other case, lies in the difference between essential constitutional meaning and its application, to which reference was made earlier in these reasons. The essential meaning of "alien" in s 51(xix) is a foreigner to the Australian political community. The application of that essential meaning will depend upon the relevant facts and circumstances that exist at the time of application; here, the time of application being the point at which Mr Chetcuti was detained under s 189 of the Migration Act following the cancellation of his visa in 2017. There is no person whose constitutional status with respect to alienage is immune from any change in facts and circumstances and is therefore indelible. Even a person who today is outside the application of s 51(xix), such as an Aboriginal Australian or a person born in Australia to two Australian citizen parents, might tomorrow be within the application of that power. In the former example, a person might cease to identify or be recognised as an Aboriginal Australian. In the latter example, the person might renounce their Australian citizenship conferred by statute179 and accept foreign citizenship, thereby ending their membership of the Australian political community. This point is equally true of other changes in political and social facts and circumstances. The circumstance that at some time before 26 January 1949 at least some British subjects were incapable of being treated as aliens within s 51(xix) is not immutable. Allegiance had ceased to be understood as indelible shortly before 179 See Australian Citizenship Act 2007 (Cth), s 12(1)(a). See also s 33. Edelman Australian Federation180. The essence of the reasoning of the majority in Shaw was therefore as follows181: "Once it be decided that the text of the Constitution contemplates changes in the political and constitutional relationship between the United Kingdom and Australia, it is impossible to read the legislative power with respect to 'aliens' as subject to some implicit restriction protective from its reach those who are not Australian citizens but who entered Australia as citizens of the United Kingdom and colonies under the [British Nationality Act 1948 (UK)]." Back to Mr Chetcuti Whether or not Mr Chetcuti fell within the conception of an alien in s 51(xix) of the Constitution when he arrived in Australia on 31 July 1948 is not critical to the resolution of this appeal. The issue is whether he was within that conception when the Minister purported to apply the terms of the Migration Act to him in 2017. The gap in the transitional provision in the 1949 Act meant that Mr Chetcuti did not become an Australian citizen on 26 January 1949 because he had not been resident in Australia for five years before the commencement of the 1949 Act. Mr Chetcuti never became registered as an Australian citizen under the 1949 Act. In 1964, Mr Chetcuti became a citizen of Malta on the occurrence of Maltese independence182. He did not subsequently become a citizen of this country under the Australian Citizenship Act 2007 (Cth). In 2017, therefore, Mr Chetcuti's relevant circumstances were as follows: he was born outside Australia; he had no Australian parents; he was not an Australian citizen given that he had never been registered as an Australian citizen and had not been naturalised; and he was a citizen of a foreign country. On an application since at least 2017 of the meaning of "alien" – a foreigner to the Australian political community – he was capable of being treated as an alien within s 51(xix) and was therefore a person to whom the Migration Act could apply. 180 See Great Britain, Report of the Royal Commissioners for Inquiring into the Laws of Naturalization and Allegiance (1869) at v; Naturalization Act 1870 (UK). See also Wishart, "Allegiance and Citizenship as Concepts in Constitutional Law" (1986) 15 Melbourne University Law Review 662 at 698-699. 181 (2003) 218 CLR 28 at 42 [27]. 182 Constitution of Malta 1964, s 23(1). Edelman Conclusion The appeal must be dismissed with costs. STEWARD J. Some constitutional issues require consideration of "a unique mixture of history, statutory interpretation, and some political philosophy"183. History looms large in this appeal. This Court has previously acknowledged that in 1900 no subject of the British Crown was an alien within any part of the British Empire184. At that time, a "subject" of the British Crown referred to a status held by a person independently from any Act of the Imperial Parliament or any colonial parliament. As Quick and Garran observed in 1901185: "[t]he rule of the common law is that every person born out of the British Dominions is an alien, and that every person born within British Dominions is a British subject". This state of affairs continued after federation. In Nolan v Minister for Immigration and Ethnic Affairs, the majority said186: immediately enjoy "Even after federation, Australia did not the international status of an independent nation. The terms 'British subject' and 'subject of the Queen' were essentially synonymous. The British Empire continued to consist of one sovereign State and its colonial and other dependencies with the result that there was no need to modify either the perception of an indivisible Imperial Crown or the doctrine that, under the common law, no subject of the Queen was an alien in any part of Her Majesty's dominions: see, eg, Co Litt 129a, 129b; Bract 427b; Blackstone's Commentaries, 8th ed, vol 1, p 366." 183 Plaintiff S157/2002 v The Commonwealth (2003) 211 CLR 476 at 514 [108] per Callinan J, quoting Sir Robert Menzies, Afternoon Light (1967) at 320. 184 Nolan v Minister for Immigration and Ethnic Affairs (1988) 165 CLR 178 at 183 per Mason CJ, Wilson, Brennan, Deane, Dawson and Toohey JJ. 185 Quick and Garran, The Annotated Constitution of the Australian Commonwealth 186 (1988) 165 CLR 178 at 183-184 per Mason CJ, Wilson, Brennan, Deane, Dawson Thus, in 1906 Griffith CJ, Barton and O'Connor JJ observed187: "We are not disposed to give any countenance to the novel doctrine that there is an Australian nationality as distinguished from a British nationality". At some point following federation, British subjects, not born in Australia, became aliens of this country. That is because they owed allegiance to the Crown in right of the United Kingdom as opposed to the Crown in right of Australia188. This occurred when the indivisible Imperial Crown manifested itself as the Crown in right of Australia. It is impossible to identify any bright line as to when this took place; in fact, it took place over time. As the majority in Nolan also said189: "The transition from Empire to Commonwealth and the emergence of Australia and other Dominions as independent sovereign nations within the Commonwealth inevitably changed the nature of the relationship between the United Kingdom and its former colonies and rendered obsolete notions of an indivisible Crown. A separate Australian citizenship was established by the Nationality and Citizenship Act 1948 (Cth), now known as the Australian Citizenship Act 1948. That Act and statutes of other Commonwealth countries, particularly the British Nationality Act 1948 (UK), reflected and formalized the diminished importance of the notion of 'British subject'. It became accepted as a 'truism' that, although 'there is only one person who is the Sovereign ... , ... in matters of law and government the Queen of the United Kingdom ... is entirely independent and distinct from' the Queen of (eg) Canada or Australia: per May LJ, Reg v Foreign Secretary; Ex parte Indian Association." (footnote omitted) Nonetheless, in Shaw v Minister for Immigration and Multicultural Affairs190 a bright line was identified by this Court. A date was chosen. It was 26 January 1949191. On that day, the Nationality and Citizenship Act 1948 (Cth) 187 Attorney-General for the Commonwealth v Ah Sheung (1906) 4 CLR 949 at 951. 188 See, eg, Sue v Hill (1999) 199 CLR 462 at 503 [96] per Gleeson CJ, Gummow and 189 Nolan v Minister for Immigration and Ethnic Affairs (1988) 165 CLR 178 at 184 per Mason CJ, Wilson, Brennan, Deane, Dawson and Toohey JJ. 190 (2003) 218 CLR 28. 191 Shaw v Minister for Immigration and Multicultural Affairs (2003) 218 CLR 28 at 43 [32] per Gleeson CJ, Gummow and Hayne JJ. ("the 1948 Citizenship Act") came into effect. That Act created, for the first time, the statutory concept of Australian citizenship. From that date, a British subject arriving in Australia did so as an alien. Gleeson CJ, Gummow and Hayne JJ said192: "This case should be taken as determining that the aliens power has reached all those persons who entered this country after the commencement of the Citizenship Act on 26 January 1949 and who were born out of Australia of parents who were not Australian citizens and who had not been naturalised. The scope of any earlier operation of the power does not fall for consideration. However, it may be observed that, like the other powers of the Parliament, s 51(xix) is not to be given any meaning narrowed by an apprehension of extreme examples and distorting possibilities of its application in some future law." (footnote omitted) The 26th of January 1949 should be accepted as a necessary and sufficient date for the emergence of the Crown in right of Australia. No earlier date should be accepted. In Pochi v Macphee, Gibbs CJ described the breadth of the aliens power in s 51(xix) of the Constitution in the following terms193: "the Parliament can in my opinion treat as an alien any person who was born outside Australia, whose parents were not Australians, and who has not been naturalized as an Australian." Because of Australian history, the foregoing statement of power requires two qualifications. First, in 1900, an alien was a person born outside the British Empire, rather than Australia. Secondly, British subjects entering Australia prior to 26 January 1949 are not aliens for the purposes of the Constitution. Those subjects "could not possibly answer the description of 'aliens' in the ordinary understanding of the word"194. For the reasons that follow, Mr Chetcuti was not an alien when he arrived in Australia in 1948. Nor did he subsequently become an alien on 26 January 1949. He falls within the foregoing qualifications and is therefore excluded from the reach of the aliens power. 192 Shaw v Minister for Immigration and Multicultural Affairs (2003) 218 CLR 28 at 193 (1982) 151 CLR 101 at 109 (Mason and Wilson JJ agreeing). 194 Pochi v Macphee (1982) 151 CLR 101 at 109 per Gibbs CJ (Mason and Wilson JJ agreeing). In that respect, Mr Chetcuti's status as a non-alien is not denied because he is not an Australian citizen. The concepts of alienage and non-citizenship may overlap, but they are not synonymous195. For example, for a period of time, persons born in Papua New Guinea were citizens of Australia, but that status did not entitle Papuans to enter or permanently reside in Australia196. In Singh v The Commonwealth, Gummow, Hayne and Heydon JJ observed that the "central characteristic" of the status of an alien is "owing obligations (allegiance) to a sovereign power other than the sovereign power in question (here Australia)"197. In Australia, the sovereign power may, in colloquial terms, be expressed as the Commonwealth of Australia. But as a matter of the law of alienage, allegiance to a sovereign power is expressed as allegiance to the Queen in right of Australia198. In that respect, the reference to a "subject of the Queen" in s 117 of the Constitution is now necessarily a reference to the Queen in right of Australia199. Background Mr Chetcuti was born in Malta in 1945. He arrived in Australia, before 26 January 1949, on 31 July 1948. Until it obtained independence in 1964, Malta was a British colony200. Its people had only recently received the George Cross for their gallantry during the Second World War. Mr Chetcuti was thus a British 195 See Chu Kheng Lim v Minister for Immigration, Local Government and Ethnic Affairs (1992) 176 CLR 1 at 54 per Gaudron J; Singh v The Commonwealth (2004) 222 CLR 322 at 374 [122] per McHugh J, 382 [149]-[150] per Gummow, Hayne 196 Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Ame (2005) 222 CLR 439 at 445 [1], 447 [6], 449 [12], 454-455 [22] per Gleeson CJ, McHugh, Gummow, Hayne, Callinan and Heydon JJ, 471 [76] per Kirby J. 197 (2004) 222 CLR 322 at 383 [154], 398 [200]. 198 cf Sue v Hill (1999) 199 CLR 462 at 498-499 [84]-[85] per Gleeson CJ, Gummow 199 Nolan v Minister for Immigration and Ethnic Affairs (1988) 165 CLR 178 at 186 per Mason CJ, Wilson, Brennan, Deane, Dawson and Toohey JJ; Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 432 [123], 435 [131] per McHugh J, 495 [311] 200 Her Majesty the Queen remained Malta's Head of State for a further 10 years until 1974, when Malta transitioned from a monarchical to a Republican constitution: Constitution of Malta, s 1(1). subject201. He was also not an "alien" when he arrived in Australia for the purposes of the Nationality Act 1920 (Cth) or the Aliens Act 1947 (Cth). Pursuant to the former Act, an "alien" was defined to be "a person who is not a British subject"; a "British subject" was, amongst other things, defined to mean "a person who is a natural-born British subject"202. The definition of "alien" in the latter Act also excluded British subjects203. As properly conceded by the Solicitor-General of the Commonwealth, upon arrival in Australia Mr Chetcuti was, under Australian law, the same "British subject" as a person who had been born in this country. On 30 July 1948, the day before Mr Chetcuti's arrival in Australia, the Imperial Parliament passed the British Nationality Act 1948 (UK). When that Act took legal effect, on 1 January 1949, Mr Chetcuti also became a citizen of the United Kingdom. Shortly thereafter, the 1948 Citizenship Act came into effect. That Act also defined the word "alien" as, amongst other things, "a person who is not a British subject"204. By s 7(1), a person who, under the 1948 Citizenship Act, was an Australian citizen was also "by virtue of that citizenship ... a British subject". In addition, pursuant to ss 7(2) and 8(1), persons who were citizens of the "United Kingdom and Colonies, Canada, New Zealand, the Union of South Africa, Newfoundland, India, Pakistan, Southern Rhodesia and Ceylon" and Ireland205, were also, by reason of their citizenship, British subjects. The purpose of this arrangement is explained below. In 1964, Mr Chetcuti automatically became a citizen of Malta206. He never became an Australian citizen, but in 1994 Mr Chetcuti was "taken to have been 201 British subjecthood was initially conferred on Mr Chetcuti from birth pursuant to the British Nationality and Status of Aliens Act 1914 (UK). However, it was an agreed fact that he ceased to be a British subject from 1964, by virtue of s 2 of the Malta Independence Act 1964 (UK), to 1970, when he regained his status as a British subject pursuant to s 6 of the Citizenship Act 1969 (Cth). 202 Nationality Act 1920 (Cth), s 5(1). 203 Aliens Act 1947 (Cth), s 4. 204 Nationality and Citizenship Act 1948 (Cth), s 5(1). 205 Provided that the Irish citizen gave "notice in the prescribed form and manner to the Minister claiming to remain a British subject" on certain grounds. 206 Section 23(1) of the Constitution of Malta relevantly provided that every person born in Malta, and who was "a citizen of the United Kingdom and Colonies" on the day before 21 September 1964, became a Maltese citizen. granted an absorbed person visa"207. In 2019, his absorbed person visa was cancelled pursuant to s 501 of the Migration Act 1958 (Cth)208. The issue for determination is whether he is an "alien" for the purposes of the Constitution and therefore subject to Div 8 of Pt 2 of the Migration Act. If he is an "alien", he may be removed to Malta as an unlawful non-citizen pursuant to s 198 of that Act, provided that his removal is otherwise lawful. Whilst the 1948 Citizenship Act categorised Mr Chetcuti as a "British subject", and accorded him certain rights and privileges as such, he was, and otherwise remained, a British subject because he was a natural-born British subject209. That status, as described in Nolan210, did not depend upon any Act of the Federal or Imperial Parliament. In the years that immediately followed the enactment of the 1948 Citizenship Act, those British subjects in Australia who were not Australian citizens, as in the case of Mr Chetcuti, were: eligible to vote211, eligible to sit as members of the House of Representatives or in the Senate212, eligible to become 207 Migration Act 1958 (Cth), s 34, formerly, in 1994, s 26AB as inserted by the Migration Legislation Amendment Act 1994 (Cth). 208 However, Mr Chetcuti's visa had been considered for cancellation on character grounds on five occasions. He has been detained in immigration detention since 2017 following the first purported cancellation of his absorbed person visa. 209 When he arrived, Mr Chetcuti was also a British subject by reason of the British Nationality and Status of Aliens Act 1914 (UK). 210 Nolan v Minister for Immigration and Ethnic Affairs (1988) 165 CLR 178 at 183- 184 per Mason CJ, Wilson, Brennan, Deane, Dawson and Toohey JJ. See also Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 428-429 [114]-[115] per McHugh J, 440-441 [148]-[149] per Gummow and Hayne JJ, 481-482 [273] per 211 Commonwealth Electoral Act 1949 (Cth), s 3. From 1987, eligibility was limited to Australian citizens and those British subjects on the electoral roll before 26 January 1984: Statute Law (Miscellaneous Provisions) Act (No 2) 1985 (Cth), Sch 1. 212 Commonwealth Electoral Act 1918 (Cth), s 69 as amended by Commonwealth Electoral Act 1949 (Cth), s 5. See also Australia, House of Representatives, Parliamentary Debates (Hansard), 30 September 1948 at 1062. public servants213, required to register for national service from 1951214, and eligible to be issued with an Australian passport215. Prior to 1976, a person's nationality was recorded in the census as either "British" or "foreign"216. It is not wholly accurate to describe those attributes merely as "special advantages" conferred on a "class of aliens"217; rather, for the reasons set out below, those attributes reflected the status, as an historical fact, of British subjects who had arrived in Australia before 26 January 1949 and for a period of time after. Two issues arise for consideration. First, had the sovereign power of the United Kingdom and Australia already divided when Mr Chetcuti arrived in 1948? In other words, had Australia become an independent sovereign nation before 26 January 1949? Secondly, if it had not, when that division took place subsequently, did Mr Chetcuti then become an alien? The learned primary judge answered the first question by concluding that Australia became an independent sovereign nation, with its own King, when the Commonwealth Parliament enacted, in 1942, the Statute of Westminster Adoption Act 1942 (Cth)218. On that basis, it followed that Mr Chetcuti, who was born in Malta in 1945, and thus was a British subject owing allegiance to the Crown in right of the United Kingdom as opposed to the Crown in right of Australia, had arrived in Australia as an alien219. 213 Commonwealth Public Service Act 1922 (Cth), s 33(1)(a). In 1984, this requirement was changed to that of being an Australian citizen: Public Service Reform Act 1984 (Cth), s 26(b). 214 National Service Act 1951 (Cth), s 10; Defence Act 1965 (Cth), s 17. From 1992, this requirement was omitted: Defence Legislation Amendment Act 1992 (Cth), s 6. 215 Passports Act 1948 (Cth), s 4. Australia stopped issuing passports to British subjects in 1984: Passports Amendment Act 1984 (Cth), s 4. 216 See, eg, Census of the Commonwealth of Australia 1911, Vol I – Statistician's Report 217 Shaw v Minister for Immigration and Multicultural Affairs (2003) 218 CLR 28 at 40 [22] per Gleeson CJ, Gummow and Hayne JJ. 218 Chetcuti v The Commonwealth (2020) 95 ALJR 1 at 10-11 [49] per Nettle J; 385 ALR 1 at 12. 219 Chetcuti v The Commonwealth (2020) 95 ALJR 1 at 12 [52] per Nettle J; 385 ALR Steward Was Mr Chetcuti an alien on his arrival in 1948? One must commence first with the language of the Constitution. It makes no reference to a citizen or to a non-citizen; these are statutory concepts found in, for example, the Australian Citizenship Act 2007 (Cth) and the Migration Act. Indeed, it is well established and accepted that an express citizenship power was not included in s 51 of the Constitution220. Instead, the Constitution relevantly refers to an "alien" (s 51(xix)) and to a person who is a "subject of the Queen" (s 117)221. In 1901, the "Queen" meant the "Crown of the United Kingdom of Great Britain and Ireland"222. At that time, a "subject of the Queen" was, therefore, a reference to one of Her Majesty's subjects within one indivisible British Empire. So much was confirmed in Nolan223. For these reasons, and with respect, the Commonwealth's notice of contention that a British subject, not born in Australia, could be treated as an alien upon arrival in Australia from the date of federation, must be rejected. It was put by the Commonwealth that once a new Australian body politic came into existence in 1901, with a "separate distinct membership", the "Commonwealth Parliament must have had the power to define the criteria for the membership of that body politic". With respect, that submission may be logical, but it pays insufficient attention to history. In 1901, there was no "separate distinct membership" of the body politic comprising federated Australia. Rather, there was "separate distinct membership" of the British Empire, and its members comprised, not citizens of diverse British Dominions, but subjects of the Queen224. it followed that 220 See, eg, Singh v The Commonwealth (2004) 222 CLR 322 at 341 [31] per Gleeson CJ, 345 [45], 366-367 [101]-[105] per McHugh J, 395-396 [191]-[192] per Gummow, Hayne and Heydon JJ, 407 [231] per Kirby J, 423 [289]-[292] per Callinan J; Rubenstein, Australian Citizenship Law in Context (2002) at 30; Official Record of the Debates of the Australasian Federal Convention (Melbourne), 3 March 1898 at 1780-1802. 221 In different contexts, the Constitution also refers, in a number of provisions, to the "people" of the various States and of Australia: see, eg, covering cl 3. 222 Preamble to the Constitution. 223 Nolan v Minister for Immigration and Ethnic Affairs (1988) 165 CLR 178 at 183- 184 per Mason CJ, Wilson, Brennan, Deane, Dawson and Toohey JJ. 224 See Attorney-General for the Commonwealth v Ah Sheung (1906) 4 CLR 949 at 951 per Griffith CJ, Barton and O'Connor JJ; Nolan v Minister for Immigration and Nothing had changed by 1920. The Crown remained "one and indivisible". In Amalgamated Society of Engineers v Adelaide Steamship Co Ltd, Knox CJ, Isaacs, Rich and Starke JJ said225: "The Constitution was established by the Imperial Act 63 & 64 Vict c 12. The Act recited the agreement of the people of the various colonies, as they then were, 'to unite in one indissoluble Federal Commonwealth under the Crown of the United Kingdom of Great Britain and Ireland, and under the Constitution hereby established.' 'The Crown,' as that recital recognizes, is one and indivisible throughout the Empire. Elementary as that statement appears, it is essential to recall it, because its truth and its force have been overlooked, not merely during the argument of this case, but also on previous occasions. Distinctions have been relied on between the 'Imperial King,' the 'Commonwealth King' and the 'State King.' It has been said that the Commonwealth King has no power to bind the first and the last, and, reciprocally, the last cannot bind either of the others. The first step in the examination of the Constitution is to emphasize the primary legal axiom that the Crown is ubiquitous and indivisible in the King's dominions. Though the Crown is one and indivisible throughout the Empire, its legislative, executive and judicial power is exercisable by different agents in different localities, or in respect of different purposes in the same locality, in accordance with the common law, or the statute law there binding the Crown." (citations omitted) In 1944, four years before Mr Chetcuti's arrival in Australia and subject to adoption of the Statute of Westminster 1931 (UK) (as to which, see below), nothing again would appear to have changed. In Minister for Works (WA) v Gulson, Rich J observed that "[i]t has been decided by the highest authority that, in constitutional theory, the Crown is one and indivisible"226. His Honour referenced an earlier advice of the Privy Council in Williams v Howarth227. That case concerned an action by a soldier of the second New South Wales contingent, who had served in the Boer War, to recover 10 shillings per day said to be owed to him by the New South Wales Government (he had otherwise been paid his 10 shillings in part from Ethnic Affairs (1988) 165 CLR 178 at 183-184 per Mason CJ, Wilson, Brennan, Deane, Dawson and Toohey JJ. 225 (1920) 28 CLR 129 at 152. See also Theodore v Duncan (1919) 26 CLR 276 at 282 per Viscount Haldane; [1919] AC 696 at 706; Pirrie v McFarlane (1925) 36 CLR 170 at 199-200 per Isaacs J. 226 (1944) 69 CLR 338 at 356. that Government and in part in the form of "Imperial pay"; the soldier claimed, however, that the latter payment did not discharge New South Wales' obligation). The Lord Chancellor refused recovery and said it did not matter whether the soldier had been paid by the colony or the "Mother Country"228 since his employer was the Crown. His Lordship said229: "[t]he Government in relation to this contract is the King himself. The soldier is his soldier". Williams J was also of the view in Gulson that the Crown is "one and indivisible throughout the Empire"230. It follows that in 1944, it could not be said that there was a separate King in right of Australia231. The foregoing is consistent, by way of illustration only, with the service by Australian men and women in the British Army, Royal Air Force and Royal Navy during the Second World War. Flight Lieutenant Les Knight, born in Camberwell in the State of Victoria and an officer in the Royal Australian Air Force, did not serve a King different from that of his fellow members of the British "Dambusters" squadron, when he flew his Royal Air Force Lancaster aircraft to breach the Eder Dam. The same might be said of his fellow squadron member, "Micky" Martin from New South Wales. At that time, they both, together with the other members of their famous squadron, served, like the Boer War veteran in Howarth, the same King. The Commonwealth relied upon certain documents relating to the declaration of war by Australia upon Finland, Hungary, Rumania and the Japanese Empire in 1941 and 1942. The documents showed that King George VI, acting on the advice of the Federal Executive Council, assigned to the Governor-General of the Commonwealth of Australia, by means of Royal Instruments, the power to declare and proclaim war against those countries232. The Commonwealth also relied upon minutes of a meeting of the Australian War Cabinet held on 8 December 1941, which resolved that the "situation" at that time involved a state 228 Williams v Howarth [1905] AC 551 at 554. 229 Williams v Howarth [1905] AC 551 at 554. 230 Minister for Works (WA) v Gulson (1944) 69 CLR 338 at 366, quoting Theodore v Duncan (1919) 26 CLR 276 at 282 per Viscount Haldane; [1919] AC 696 at 706. 231 The indivisibility of the Crown was assumed by this Court to still exist in 1952: Wong Man On v The Commonwealth (1952) 86 CLR 125 at 128 per Fullagar J. 232 See, eg, Commonwealth of Australia Gazette, No 104, 7 April 1942; Prime Minister's Department, Cablegrams to High Commissioner, London, 8 December of war against Japan. That "situation" included Japanese attacks against Malaya, Hawaii and the Philippines233. These documents support the continuing emergence of the Commonwealth of Australia as a fully independent sovereign power. But they do not justify the conclusion that during the war the Imperial Crown transformed itself into the Crown in right of Australia. The Commonwealth Gazette, which published the Royal Instruments, described the Style and Titles of King George VI as follows234: "George VI, by the Grace of God of Great Britain, Ireland and the British Dominions beyond the Seas King, Defender of the Faith, Emperor of India." Australia is not mentioned in this Royal Style and Titles. The Gazette also records that each Royal Instrument was sealed with the "Great Seal of the Realm" rather than the "Great Seal of the Commonwealth of Australia"235. As to the War Cabinet meeting minutes, the first "situation" these record, before adverting to Japanese actions, is the following message from the "Admiralty": "[c]ommence hostilities against Japan repetition Japan at once"236. The "Admiralty", I infer, is a reference to the British Government department then responsible for the command of the Royal Navy. It follows that the war documents relied upon by the Commonwealth do not unambiguously assert the existence of a Crown in right of Australia. Rather, they show growing steps towards independence. Nothing took place after 1944, and prior to the enactment and coming into effect of the 1948 Citizenship Act, that led to a divisible Crown. The materials before the Court demonstrate that the 1948 Citizenship Act was the product of a British Commonwealth Conference on Nationality and Citizenship, which took place in London in 1947. Australian representatives attended this Conference, together with representatives of the other British Dominions and the United Kingdom. The minutes of the first meeting record that the peoples of these countries belonged "not only to their own country, but also to the wider association of 233 Minutes of War Cabinet Meeting, Melbourne, 8 December 1941 at 217. 234 Commonwealth of Australia Gazette, No 104, 7 April 1942. 235 Commonwealth of Australia Gazette, No 104, 7 April 1942. 236 Minutes of War Cabinet Meeting, Melbourne, 8 December 1941 at 216. countries comprising the Commonwealth"237. This had led to the adoption by most of the British Dominions of "the principle of the common status"238. Under this principle, "every person recognised by the law of one [British Dominion] as belonging to the Commonwealth should be so recognised by the laws of all the [British Dominions]"239. In the past, this had been achieved by each country enacting a "common code" which defined the class of person, or persons, "who had the common status"240. The "common code" had been created by the British Nationality and Status of Aliens Act 1914 (UK)241. Amongst other things, that Act defined a natural-born British subject to be "[a]ny person born within His Majesty's dominions and allegiance"242. However, this "common code" practice was considered by the Conference members to have the disadvantage that if one British Dominion wished to make a change to its nationality laws, it was obliged to consult with the other Commonwealth countries243. This inconvenience, it was thought, might lead to 237 Minutes of the First Meeting of the British Commonwealth Conference on Nationality and Citizenship, London, 3 February 1947 at 3. 238 Minutes of the First Meeting of the British Commonwealth Conference on Nationality and Citizenship, London, 3 February 1947 at 3. 239 Minutes of the First Meeting of the British Commonwealth Conference on Nationality and Citizenship, London, 3 February 1947 at 3. See also Australia, House of Representatives, Nationality and Citizenship Bill 1948, Explanatory Memorandum at 1 [2]. 240 Minutes of the First Meeting of the British Commonwealth Conference on Nationality and Citizenship, London, 3 February 1947 at 3. 241 British Commonwealth Conference on Nationality and Citizenship (London, 26 February 1947): Report with Appendices (1947) at 1. 242 British Nationality and Status of Aliens Act 1914 (UK), s 1(a). 243 Minutes of the First Meeting of the British Commonwealth Conference on Nationality and Citizenship, London, 3 February 1947 at 3. See also Australia, House of Representatives, Nationality and Citizenship Bill 1948, Explanatory Memorandum at 1 [3]. "unilateral action" that would impair "the common code and possibly ... the common status"244. A solution was proposed, inspired by the passing of Canada's Canadian Citizenship Act 1946 (Can)245. Under that Act, as understood by the Conference members, the qualifications for being a Canadian citizen were first defined, and then it was provided that each such citizen was also to have the "common status" of being a British subject246. The Conference members proposed that all self-governing countries of the Commonwealth enact similar legislation247. A subsequent report prepared by the Conference thus recommended the following "system"248: "that each of the countries shall by its legislation determine who are its citizens, shall declare those citizens to be British subjects and shall recognise as British subjects the citizens of the other countries." The foregoing explains the applicable structure of the 1948 Citizenship Act, which provided that all Australian citizens were to be British subjects and recognised the citizens of the specified British Dominion countries also to be British subjects249. As Mr Calwell, the then Minister for Information and Minister 244 Minutes of the First Meeting of the British Commonwealth Conference on Nationality and Citizenship, London, 3 February 1947 at 3. 245 Minutes of the First Meeting of the British Commonwealth Conference on Nationality and Citizenship, London, 3 February 1947 at 3. 246 Minutes of the First Meeting of the British Commonwealth Conference on Nationality and Citizenship, London, 3 February 1947 at 3. See also Australia, House of Representatives, Nationality and Citizenship Bill 1948, Explanatory Memorandum at 1 [4]. 247 Minutes of the First Meeting of the British Commonwealth Conference on Nationality and Citizenship, London, 3 February 1947 at 3. See also British Commonwealth Conference on Nationality and Citizenship (London, 26 February 1947): Report with Appendices (1947) at 3; Australia, House of Representatives, Nationality and Citizenship Bill 1948, Explanatory Memorandum at 1-2 [5]. 248 British Commonwealth Conference on Nationality and Citizenship (London, 26 February 1947): Report with Appendices (1947) at 3. 249 Nationality and Citizenship Act 1948 (Cth), s 7. for Immigration, observed in the second reading speech for the Nationality and Citizenship Bill 1948250: "The bill which I have the honour to present this evening seeks to establish for the first time the principle of Australian citizenship, while maintaining between the component parts of the British Commonwealth of Nations the common bond of British nationality ... The bill is not designed to make an Australian any less a British subject, but to help him to express his pride in citizenship of this great country ... To say that one is an Australian is, of course, to indicate beyond all doubt that one is British". (emphasis added) Agreeing to a change in the "common code" at the Conference held in 1947 did not have the effect of transforming the Imperial Crown into a divided Crown. That is because, whilst the Conference recommended that each British Dominion should create its own rules for citizenship, it was also agreed to continue with the principle of "common status". In that respect, it was recommended that each British Dominion pass a law whereby citizenship in that Dominion conferred upon a person the status of British subject251. The adoption of the Canadian scheme was not intended to divide the Commonwealth and Empire or the Imperial Crown; rather it was to avoid, as described above, a particular disadvantage found in the old "common code". Citizens of each British Dominion otherwise expressly retained their status as British subjects. Another relevant event was the enactment of the Royal Style and Titles Act (Australia) 1947 (Cth). Pursuant to that Act, the Parliament of the Commonwealth assented to the omission from the Royal Style and Titles of the words "Indiae Imperator" and "Emperor of India"252. Seeking in this way the assent of the Federal Parliament was another step towards the emergence of the Crown in right of Australia. But in 1947, the Royal Style and Titles still did not refer to Australia. 250 Australia, House of Representatives, Parliamentary Debates (Hansard), 30 September 1948 at 1060. 251 See, eg, Nationality and Citizenship Act 1948 (Cth), s 7. See also Australia, House of Representatives, Nationality and Citizenship Bill 1948, Explanatory Memorandum at 1-2 [5]-[7]. 252 Royal Style and Titles Act (Australia) 1947 (Cth), s 3; Australia, Senate, Parliamentary Debates (Hansard), 27 November 1947 at 2796. The first reference to Australia only appeared in 1953253. The reference to the United Kingdom in the Royal Style and Titles was only deleted in 1973254. With very great respect to the learned primary judge, it should not be accepted that the Imperial Crown was transformed, relevantly into the Crown in right of Australia, from the enactment of the Statute of Westminster Adoption Act in 1942. It may be accepted that Australia's adoption of the Statute of Westminster was a pivotal step towards Australia's independence; but it was not the step that completed that process. The preamble to the Statute of Westminster affirms that the British Dominions remained "united by a common allegiance to the Crown"255. The Statute of Westminster legally affirmed what probably already existed (due to the forbearance of the Imperial Parliament), namely, the relationship of equality that existed as between each British Dominion Parliament and the Parliament at Westminster. But, critically, it did not alter the constitutional relationship between each British Dominion and the Crown. That relationship was expressed to be one of "common allegiance"256. That quality of commonality is not consistent with a divided Crown; indeed, it is entirely inconsistent with it. Similar expressions of unity may be found in the Balfour Declaration of the Imperial Conference of 1926257. Again, the purpose of the Balfour Declaration was to acknowledge the equality in status and power of certain of the British Dominions, including Australia. But that Declaration in no way authorised, recognised or established that the Imperial Crown was a divided monarchy in 1926. On the contrary, the Declaration expressly recognised the continuation of a "united" allegiance to the Crown by all British subjects throughout the United Kingdom and the British Dominions258. For example, the Imperial Conference included a "message" to the King and Queen, which expressed the hope that their Majesties "may long be spared to strengthen the ties of affection and devotion 253 Royal Style and Titles Act 1953 (Cth), Schedule. 254 Royal Style and Titles Act 1973 (Cth), Schedule. 255 Preamble to the Statute of Westminster 1931 (UK). 256 Preamble to the Statute of Westminster 1931 (UK). 257 See, eg, Australia, Parliament, Imperial Conference, 1926: Summary of Proceedings 258 Australia, Parliament, Imperial Conference, 1926: Summary of Proceedings (1927) which unite the peoples of the British Commonwealth under the Crown"259. Under the heading "STATUS OF GREAT BRITAIN AND THE DOMINIONS", the British Dominions are described in the Balfour Declaration in the following way260: "They are autonomous Communities within the British Empire, equal in status, in no way subordinate one to another in any aspect of their domestic or external affairs, though united by a common allegiance to the Crown, and freely associated as members of the British Commonwealth of Nations." (emphasis in original) The expression of "common allegiance" is again inconsistent with the existence in 1926 of a divided Crown and is entirely consistent with the statements made by this Court in 1920261 and in 1944262, set out above. The foregoing accords with Sir Owen Dixon's analysis of the Statute of Westminster. Writing extra-judicially in 1935, Sir Owen Dixon made several observations about that Statute. One of these concerned the supremacy of the Crown and the proposition that the Crown became "the visible sign of national power"263. Sir Owen Dixon then observed264: "[t]he Sovereign remains at the head of each member of the British Commonwealth and its powers of government are exercised in his name". Whilst the ultimate decision in Shaw was carefully expressed to be confined to those British subjects who had arrived in Australia after 26 January 1949 (Mr Shaw had arrived in 1974), it should be accepted that the reasoning of the 259 Australia, Parliament, Imperial Conference, 1926: Summary of Proceedings (1927) 260 Australia, Parliament, Imperial Conference, 1926: Summary of Proceedings (1927) 261 Amalgamated Society of Engineers v Adelaide Steamship Co Ltd (1920) 28 CLR 129 at 152 per Knox CJ, Isaacs, Rich and Starke JJ. 262 Minister for Works (WA) v Gulson (1944) 69 CLR 338 at 356 per Rich J, 366 per 263 Sir Owen Dixon, "The Law and the Constitution", in Jesting Pilate and Other Papers and Addresses (1965) 38 at 59. 264 Sir Owen Dixon, "The Law and the Constitution", in Jesting Pilate and Other Papers and Addresses (1965) 38 at 59-60. plurality was premised on the likelihood that the Crown in right of Australia had emerged before that date. As Gleeson CJ, Gummow and Hayne JJ observed265: "The classification by s 7 of the Citizenship Act of the citizens of the United Kingdom, Canada, New Zealand, the Union of South Africa, Newfoundland, India, Pakistan, Southern Rhodesia and Ceylon, as British subjects in Australian law by virtue of that citizenship, also was an exercise of the legislative power with respect to aliens. The new statutory status rendered those persons a class of aliens with special advantages in Australian law, as mentioned above. It can hardly be said that, as the relevant political facts and circumstances stood in 1948, those citizens could not possibly answer the description of aliens in the ordinary understanding of that word." (emphasis added) However, no earlier date for the emergence of the Crown in right of Australia was identified by the plurality and the ultimate decision was confined to 26 January 1949. Moreover, the observation about the circumstances in 1948 was heavily qualified; all that was said was that the citizens of, for example, the United Kingdom could "possibly" answer the description of an alien in 1948. In any event, and with great respect, a different view of the "relevant political facts and circumstances" can be taken. For the reasons set out above, this Court acknowledged in 1944266 the existence of an undivided Crown, but nothing took place thereafter, and before the 1948 Citizenship Act came into effect, which supports the emergence of the Crown in right of Australia. By reason of the foregoing, it may also be doubted whether the passing of the 1948 Citizenship Act itself justified the conclusion that the Crown in right of Australia had, by then, finally emerged as the Australian Head of State with Australians henceforth owing allegiance to a distinct King267. It may be that history justifies a later date268. The plurality in Shaw recognised the difficulty in 265 Shaw v Minister for Immigration and Multicultural Affairs (2003) 218 CLR 28 at 266 Minister for Works (WA) v Gulson (1944) 69 CLR 338 at 356 per Rich J, 366 per 267 The constitutional meaning of "alien" is, of course, not susceptible to legislative alteration. 268 In Re Patterson; Ex parte Taylor (2001) 207 CLR 391, McHugh J identified the date of the commencement of the Royal Style and Titles Act 1973 (Cth), being 19 October 1973, as the date on which the Crown in right of Australia became manifest: at 421 identifying any particular moment of division. Gleeson CJ, Gummow and "The development of the 'autonomous Communities' recognised by the Imperial Conference of 1926 proceeded by steps and over periods which had different consequences for the reading of various provisions of the Constitution. To ask when Australia actually achieved complete constitutional independence or other questions phrased in similar terms is to assume a simple answer to a complex issue, rather than to attend to the its particular matter arising under interpretation which has arisen for decision." (footnote omitted) the Constitution or involving In Nolan, the emergence of the Crown in right of Australia was described as a "truism"270 arising from the change in relations between Australia and the United Kingdom. Australia's independence as a sovereign power was not the product of any one specific legislative change; nor was it the product of any declaration or international meeting. Rather, it was a gradual process comprising political and cultural changes that the law over time, and following these changes, came to recognise as fulfilled. The most important political change was the decision of the Imperial Parliament to cease to pass laws concerning any of the Empire's Dominions. Other changes included the entry into the Washington Naval Treaty271 in 1922 and the fall of Singapore in 1942. Legal recognition of Australia's emerging independence then appeared from, amongst other things, the Balfour Declaration, the Statute of Westminster Adoption Act and the 1948 Citizenship Act. Critically, the process of independence did not call for, or depend upon, any positive act, or assent, on the part of the Australian people. It was, as McHugh J has described, a "mystical process"272. Nonetheless, as already mentioned, the plurality in Shaw drew a bright line by selecting 26 January 1949 as the date by which the Imperial Crown relevantly divided. That bright line is a necessary and convenient constitutional fiction which [91], 431-432 [121]-[123], 436 [135]; Callinan J preferred the passing of the Australia Acts 1986 (Cth and UK): at 518 [375]. 269 Shaw v Minister for Immigration and Multicultural Affairs (2003) 218 CLR 28 at 270 Nolan v Minister for Immigration and Ethnic Affairs (1988) 165 CLR 178 at 184 per Mason CJ, Wilson, Brennan, Deane, Dawson and Toohey JJ. 271 Also known as the Five-Power Treaty or Washington Treaty. 272 Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 432 [124]. should not now be disturbed. In that respect, the correctness of the decision in Shaw (as distinct from some of the plurality's reasoning) was not challenged by Mr Chetcuti. It follows that it may be accepted, for the disposition of this appeal, that British subjects who arrived in Australia after 26 January 1949 did so as aliens in the constitutional sense. As it happens, nothing here turns upon whether the time at which the Crown divided was in 1949, or some later date273. All that matters is that the division took place at some point after Mr Chetcuti's arrival in Australia. It follows that when Mr Chetcuti arrived in Australia, before 26 January 1949, he did so as a British subject and as a non-alien. That accords, if it matters, with the application to him of both the Nationality Act and the Aliens Act then in force in 1948. Did Mr Chetcuti subsequently become an alien? The next issue for determination is whether Mr Chetcuti became an alien after 26 January 1949 when, in light of the foregoing, the Crown must be taken to have become the Crown in right of Australia. That issue must be determined in accordance with the principle that a person may acquire the status or character of alienage by reason of supervening constitutional and political events not involving any positive act or assent on the part of the person concerned274. It is also possible for supervening constitutional and political events to have the effect of rendering someone who was an alien into a non-alien, and further, to have the effect of maintaining a person's status as a pre-existing non-alien. An important element of the emergence of a distinctly Australian Crown was the transfer of allegiance from the Imperial Monarch to an Australian Head of State275. This took place as part of the "mystical process"276. "By parity of reasoning"277, when the allegiance of citizens of Australia was transferred to the Queen of Australia, so too was the allegiance of those British subjects living at that time in Australia who, when they arrived, were the same British subjects as 273 See fn 268 above. 274 Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 468-469 [235] per Gummow 275 Nolan v Minister for Immigration and Ethnic Affairs (1988) 165 CLR 178 at 191 per Gaudron J; Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 421 [90], 434- 435 [130]-[131] per McHugh J, 517 [372]-[373] per Callinan J. 276 Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 432 [124] per McHugh J. 277 Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 435 [131] per McHugh J. Australians who had been born in Australia. As McHugh J said in Re Patterson; Ex parte Taylor278: "Logically, it must follow that, upon the completion of the evolutionary process, the subjects of the Queen born and living in Australia became subjects of the Queen of Australia. Henceforth, by a mystical process, they owed their allegiance to the Queen of Australia, not the Queen of the United Kingdom. In Pochi v Macphee, Gibbs CJ said that '[t]he allegiance which Australians owe to Her Majesty is owed not as British subjects but as subjects of the Queen of Australia'. But upon what legal or logical basis can this Court distinguish between subjects of the Queen of the United Kingdom born in Australia and those subjects of the Queen born outside, but living in, Australia when the evolutionary process was complete? I can see none. Birth within the sovereign's territories was the criterion by which the common law distinguished the subject of the sovereign from the alien. But that fact provides no ground for a court distinguishing between the subjects of the evolutionary process. It is also true that subjects of the Queen born in the United Kingdom continued to owe allegiance to the Queen in right of the United Kingdom. But that was not incompatible with them also owing allegiance to the Queen of Australia as subjects of that Queen while they continued to live in Australia. Whether or not they were aliens, they were under the protection of and owed allegiance to the Queen of Australia as long as they lived here. If they were subjects of the Queen living here immediately before the end of the evolutionary process, there is no constitutional reason why they could not become subjects of the Queen of Australia as well as subjects of the United Kingdom. Sue v Hill holds that this dual allegiance prevents them from being members of the federal Parliament. But nothing in the Constitution indicates that allegiance to the Queen in two capacities makes a person born in the United Kingdom an alien for the purpose of the Constitution. Indeed s 117 of the Constitution strongly supports the opposite conclusion." (emphasis in original; footnotes omitted) McHugh J was initially of the view in Patterson that British subjects became subjects of the Queen in right of Australia in 1973 upon the passing of the Royal Style and Titles Act 1973 (Cth). From that time, the Royal Style and Titles of Her Majesty the Queen in this country became: "Elizabeth the Second, by the 278 (2001) 207 CLR 391 at 432-433 [124]-[125]. Grace of God Queen of Australia and Her other Realms and Territories, Head of the Commonwealth". His Honour said279: "no attempt was made to assert the sovereignty of the Queen of Australia until the passing of the Royal Style and Titles Act 1973. Until the commencement of that Act – and maybe later – all British subjects resident in Australia, whether born here or overseas, owed their allegiance to the Queen of the United Kingdom. That being so, those British subjects, born in the United Kingdom, who were living in Australia at the commencement of the Royal Style and Titles Act 1973 became subjects of the Queen of Australia as well as subjects of the Queen of the United Kingdom. Accordingly, they were not and did not subsequently become aliens within the meaning of s 51(xix) of the Constitution." Callinan J was of a similar opinion. His Honour said280: "For a long time, it could not seriously be doubted that a British subject of the Queen living permanently in Australia was also an Australian. The majority in Sue v Hill accepted however, that the relationship between Australia and the United Kingdom (and their citizens) might alter by an evolutionary process, or by a process of transformation. In Nolan v Minister for Immigration and Ethnic Affairs a majority of this Court said that 'subject of the Queen' in s 117 of the Constitution by then meant subject of the Queen of Australia ... In the same way as the evolutionary process, to which the majority in Sue v Hill referred, transformed the meaning of the monarch as used in the Constitution, that process should also have transformed a subject of the monarch born in the United Kingdom – but having lived permanently as a subject of the monarch in this country for the period that this prosecutor has – into one of the people of Australia and a citizen of this country." (footnotes omitted) Later, in Shaw, McHugh J expressed the view that the evolutionary process by which the Queen became the Queen of Australia was only completed upon the passing of the Australia Acts 1986 (Cth and UK)281. As already mentioned, it 279 Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 436-437 [135]. 280 Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 517 [372]-[373]. 281 This had been the view of Callinan J in Patterson: Shaw v Minister for Immigration and Multicultural Affairs (2003) 218 CLR 28 at 48 [51]. should now be accepted that this evolutionary process to an Australian Crown was completed by 26 January 1949. The correctness of the foregoing reasoning did not need to be considered by the plurality in Shaw. Their Honours did not comment on it because when Mr Shaw arrived in Australia in 1974, he was already an alien. Nettle J, sitting as the primary judge in the decision below, disagreed with the foregoing reasoning of McHugh and Callinan JJ in Patterson. His Honour said282: "But, with respect, there was a logical basis of distinction between those classes of persons in that non-citizen subjects of the Queen born outside Australia continued to owe obligations of allegiance to the Queen in right of the United Kingdom, and so continued to owe allegiance to what, as a result of the process of evolution, had become a foreign sovereign power. Of course, that did not mean that Parliament was bound to treat such persons as aliens – as the later emergent ubiquity of dual citizenship attests. But the completion of that evolution does mean that it was open to Parliament to do so on the basis laid down in Nolan: that a non-citizen born abroad, to parents who were not Australians, and thus owing allegiance to a foreign power, is, generally speaking, not beyond the scope of Commonwealth legislative power with respect to 'aliens', in the ordinary, contemporary understanding of that term." (emphasis in original; footnotes omitted) With great respect, I disagree. That is for two reasons. First, because of McHugh J's observation in Patterson – leaving aside disqualification as a member of Parliament283 – nothing in the Constitution indicates that allegiance to the Queen in two capacities makes a person, who has arrived in Australia as a non-alien British subject, an alien for the purpose of the Constitution after 26 January 1949. Secondly, and more fundamentally, it is difficult to accept that British subjects, resident in Australia, retained any allegiance to the Queen in right of the United Kingdom when they took up allegiance to the Queen in right of Australia. The better view is that, together with all Australian citizens, one allegiance replaced the other. This conclusion is consistent with the legal proposition that the Crown in right of Australia, when exercising duties within this country, should be considered "present"284 in Australia. Following completion of the "mystical 282 Chetcuti v The Commonwealth (2020) 95 ALJR 1 at 7 [32]; 385 ALR 1 at 7-8. 283 Constitution, s 44. See also Sue v Hill (1999) 199 CLR 462. 284 In re Holmes (1861) 2 Johns & Hem 527 at 543 per Sir William Page Wood V-C [70 ER 1167 at 1174], quoted in R v Secretary of State for Foreign and process"285, the Crown in right of the United Kingdom ceased entirely to be "present" in Australia. In such circumstances, it should not be accepted that British subjects, who arrived as non-aliens and have lived permanently in Australia ever since, retained any allegiance to that Crown. Such a conclusion may perhaps more readily be drawn in the case of Mr Chetcuti, who arrived in Australia at the age of three and has lived here ever since286. It follows that Mr Chetcuti is not an alien for the purposes of the Constitution and the Commonwealth has no constitutionally valid power to remove him to Malta. The foregoing conclusion is not inconsistent with the usually accepted definition of "alien" as propounded by Gibbs CJ in Pochi v Macphee287 and set out above. That expression of principle was not intended to be an exhaustive statement of the power conferred by s 51(xix) of the Constitution288. Moreover, the question of who is an alien had not then been "fully explored" before the Court289. Nor was Gibbs CJ required to decide whether a person in the position of Mr Chetcuti was an alien. It follows, for the reasons already given, that the principle expressed by Gibbs CJ must necessarily be qualified. It does not apply to British subjects who arrived in Australia before 26 January 1949 as non-aliens, who have since lived here as Australians, who thus owe allegiance to the Queen of Australia, and who have not otherwise renounced that allegiance. Mr Chetcuti's Maltese citizenship In 1964, Maltese citizenship was conferred automatically on Mr Chetcuti. The Commonwealth submitted that this was sufficient to render him an alien, as it was demonstrative of allegiance to a foreign power. The Commonwealth relied upon Singh, where a child, born in Australia in 1998 of Indian parents, and who was thereby automatically an Indian citizen, was found to be an alien. Singh may be distinguished because Mr Chetcuti did not arrive in Australia as an "alien", and Commonwealth Affairs; Ex parte Indian Association of Alberta [1982] QB 892 at 922 per Kerr LJ. 285 Re Patterson; Ex parte Taylor (2001) 207 CLR 391 at 432 [124] per McHugh J. 286 Save for a temporary absence between November 1958 and July 1959. 287 (1982) 151 CLR 101 at 109-110 (Mason and Wilson JJ agreeing). 288 Cunliffe v The Commonwealth (1994) 182 CLR 272 at 374-375 per Toohey J. 289 Pochi v Macphee (1982) 151 CLR 101 at 109 per Gibbs CJ, 112 per Murphy J. has not, for the reasons I have given, since become an alien. His allegiance, by reason of his birth in Malta in 1945 and his arrival in Australia as a British subject in 1948, at first to the Crown generally and thereafter to the Crown in right of Australia, distinguishes him from the plaintiff in Singh, whose only allegiance was to the Republic of India. Mr Chetcuti's allegiance to the Crown was not broken because in 1964 the Constitution of Malta rendered automatically every person born in Malta a Maltese citizen290. Nor is there here anything like the express regulation, considered in Re Minister for Immigration and Multicultural and Indigenous Affairs; Ex parte Ame291, whereby new citizens of Papua New Guinea ceased to be Australian citizens292. For the reasons already explained, citizenship is not the same legal concept as that of being a non-alien. The remote and automatic conferral of Maltese citizenship on Mr Chetcuti did not deny or preclude the continued existence of his allegiance to the Australian Crown293. No specific right, privilege or obligation conferred on Mr Chetcuti by reason of him being a Maltese citizen was ever identified which supported the presence of an allegiance to the Republic of Malta294. In that respect, Mr Chetcuti stands in the same position as Australian dual citizens; it has never been suggested by this Court that such citizens are aliens because of an allegiance to a foreign power. I would allow the appeal. 290 Constitution of Malta, s 23(1). 291 (2005) 222 CLR 439. 292 Papua New Guinea Independence (Australian Citizenship) Regulations 1975 (Cth), reg 4. 293 cf Sykes v Cleary (1992) 176 CLR 77 at 107 per Mason CJ, Toohey and McHugh JJ. 294 cf Re Canavan (2017) 263 CLR 284 at 329 [134] per Kiefel CJ, Bell, Gageler, Keane, Nettle, Gordon and Edelman JJ.

HIGH COURT OF AUSTRALIA APPELLANT AND ROBERT JOHN WILKINS & ORS RESPONDENTS Dovuro Pty Limited v Wilkins [2003] HCA 51 11 September 2003 ORDER Appeal allowed with costs. Set aside paragraph 1 of the orders of the Full Court of the Federal Court made on 21 December 2000 and paragraphs 3, 4 and 6 of the orders of that Court made on 5 March 2001 and, in lieu thereof, order that: the appeal by Dovuro Pty Ltd ("Dovuro") against the declarations made by Wilcox J on 19 May 2000 be allowed with costs; and the declarations made by Wilcox J on 19 May 2000 be set aside and, in lieu thereof, judgment be entered for Dovuro with costs. On appeal from the Federal Court of Australia Representation: B W Rayment QC with M M Macrossan for the appellant (instructed by Griffith Hack Lawyers) C T Barry QC with J E Rowe for the first respondents (instructed by Long Howland Lawyers) No appearance for the second and third respondents Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports. CATCHWORDS Dovuro Pty Limited v Wilkins Negligence – Breach of duty – Canola seeds imported from New Zealand – Imported seed also contained weed seeds – Whether reasonably foreseeable that weeds would be declared prohibited plants by Western Australian Government with consequent financial loss to purchasers. Practice and procedure – Federal Court – Proceedings under Federal Court of Australia Act 1976 (Cth), Pt IVA – Powers of Court to make "declarations of liability" – Interlocutory declaration of liability – Whether available and should have been made. Evidence – Admissions – Civil proceedings for damages for negligence – Distinction between admission and apology – Availability of admission by party of mixed law and fact. Appeal – Concession made at trial – Whether issue can be argued for first time on appeal. Words and phrases – "declarations of liability". Customs Act 1901 (Cth). Quarantine Act 1908 (Cth). Federal Court of Australia Act 1976 (Cth), Pt IVA. Agriculture and Related Resources Protection Act 1976 (WA). Quarantine (Plants) Regulations 1935 (Cth). Customs (Prohibited Imports) Regulations 1956 (Cth). GLEESON CJ. The principal issue in this appeal concerns a challenge to a finding of negligence on the part of a producer and distributor of canola seed. The finding was made by Wilcox J in the Federal Court1, and upheld by a majority in the Full Court of the Federal Court2 (Branson and Gyles JJ, In Graham Barclay Oysters Pty Ltd v Ryan3 I set out my views on the approach this Court should take where there are concurrent findings of negligence (or absence of negligence) at a trial and in an intermediate court of appeal. It is unnecessary to repeat what was said there. The problem that arises in the present case (coincidentally also involving a decision of the same trial judge and a division of opinion in the intermediate court of appeal) is of a similar nature. The facts of the case, and the issues that arose at trial and on appeal, appear from the reasons for judgment of other members of the Court. I agree that the appellant should not be permitted to resile from its concession as to duty of care. I will confine my attention to the challenge to the finding of a breach of duty. The case presented an unusual problem. The canola seed distributed by the appellant was not sold as being free of weeds. It was sold as of "minimum 99% purity". It conformed to that description. There is nothing unusual about such a product containing small quantities of weed seeds. This canola seed contained small quantities of three kinds of plant, cleavers, redshank and field madder4. As Gyles J pointed out5, they "occur naturally and are not poisonous, noxious or diseased in themselves, and do not transmit disease or noxious qualities to stock or humans or even to the canola seed either as part of the seed mix or in the ground". His Honour also pointed out that "seeds and weeds are the subject of a comprehensive system of international, national and state regulation"6, and there was no prohibition on the importation or sale in any part of Australia, including Western Australia, of canola seed containing weeds of the type, and in the quantity, in question. No actual harm to the crop, or the land, of 1 Wilkins v Dovuro Pty Ltd (1999) 169 ALR 276. 2 Dovuro Pty Ltd v Wilkins (2000) 105 FCR 476. (2002) 77 ALJR 183 at 194-196 [48]-[55]; 194 ALR 337 at 351-353. (1999) 169 ALR 276 at 283 [28]. (2000) 105 FCR 476 at 528-529 [185]. (2000) 105 FCR 476 at 529 [187]. the growers who bought and sowed the seed was shown to have occurred. Their financial loss resulted from the fact that, after they bought and planted the seed, the Western Australian agricultural authorities became concerned about possible harm, and declared the weeds as prohibited species. Those declarations required the growers to take certain precautionary measures. Subsequently, the declarations were cancelled7. In the meantime, the farmers suffered financial loss and expense which they sued to recover. The appellant's case was that, when it imported and distributed the canola seed, there was nothing in the complex and comprehensive regulatory schemes operating throughout Australia that prohibited the importation or distribution of seed containing weeds of the kind, and in the quantity, which it sold. As a reasonable seed merchant, it relied upon the regulatory system. It was unreasonable to require it to foresee what it said was an excessive and temporary response on the part of the Western Australian authorities. Accepting that it owed a duty to take reasonable care to avoid risk of economic loss to farmers who bought the seed, it did nothing wrong. Its conduct was reasonable. After the event, officers and associates of the appellant apologised to the growers. An analysis of the reasons of the Full Court shows that those apologies, and the admissions they were said to contain, were decisive of the outcome in that Court. It will be necessary to return to them. The findings of Wilcox J on the issue of negligence were expressed in the following form8. First, having previously dealt with some of the background history, he referred to the evidence as to "contentious matters". The problem in Western Australia arose as a result of some press reports that caused alarm to farmers and that called for action on the part of the authorities to prevent contamination of local agriculture. There had evidently been some difference of opinion within the Western Australian authorities. It was argued that they over- reacted. Wilcox J concluded that the authorities did not over-react9. That, however, is not to say that it was reasonably foreseeable that they would behave as they did. Secondly, Wilcox J recited the particulars of negligence relied on in the written submissions filed on behalf of the growers. Finally, adding reasons, he expressed agreement with certain of those submissions10. (2000) 105 FCR 476 at 495-496 [74]. (1999) 169 ALR 276 at 293-311 [62]-[109]. (1999) 169 ALR 276 at 297 [71]. 10 (1999) 169 ALR 276 at 308 [104], 311 [108]. The submissions with which Wilcox J agreed criticised the appellant for failing to do either or both of two things: failing to check specifically with the Western Australian authorities as to what their reaction to the sale of canola seed with the particular weeds in question was likely to be; and failing (by labelling or otherwise) to inform growers (and, through them, the authorities) of the exact contents of what they were buying11. For reasons that will appear, it is the second that became the most important. Those grounds of negligence necessarily involve a rejection of the contention that the appellant was entitled to rely upon the regulatory regimes, and upon the absence of any prohibition of the goods it sold. Wilcox J identified as "the question" whether reliance on the governmental agencies was a sufficient discharge of the appellant's duty of care. He answered that question in the negative12. In the Full Court, Branson J did not deal specifically with the finding that the appellant was negligent in failing to check with the Western Australian authorities. However, she attached importance to the apologetic communications from the appellant. She recognised that an apology might merely indicate regret that an incident has occurred, but saw in the terms of the appellant's communications an admission that, but for the commercial pressures under which it operated, the appellant "would have done something differently after seed production from that which it did do. That something, about which no evidence was given, could only have been greater efforts to clean the seed or greater efforts to inquire and, if necessary, warn about the weed seeds."13 Her Honour thought the latter was the more likely explanation. This supported the second basis on which Wilcox J found negligence. Finkelstein J dealt in detail with the trial judge's findings of negligence, and disagreed with them. His Honour's reasons are referred to by Hayne and As to the first basis of negligence, Finkelstein J said14: "There is, in any event, an air of unreality about the suggestion that Dovuro should have made inquiries of relevant government departments to ascertain whether there would be any problem if it imported canola seed that contained a small quantity of cleaver, redshank or field madder. If it were required to make such inquiries, on the facts of the case those 11 (1999) 169 ALR 276 at 304-311 [96]-[108]. 12 (1999) 169 ALR 276 at 305 [97], 308 [102], 311 [107]. 13 (2000) 105 FCR 476 at 481 [10]. 14 (2000) 105 FCR 476 at 500 [90]. inquiries would have been directed to five separate departments, one in the Commonwealth and four in the States. I suppose there to be no difficulty in formulating the question to be put to each department. But it is far from clear what Dovuro's obligation would have been had its inquiry yielded any of the following types of response, each of which was a possible response: 'We will let you know, but it may take some time'; 'It will be necessary to look into the matter and perhaps conduct tests to provide an answer'. Was Dovuro obliged to await a response? If so, for how long? What if the response was uninformative, such as 'We do not know whether the weeds are a problem'? It is plain enough, in my view, that the suggestion that Dovuro should make inquiries of relevant government departments proceeded on the assumption that Dovuro would be informed that the canola seed mixed with the weed seeds should not be brought into some areas where it may be sown. However, that assumption has no foundation." The concluding sentence in that paragraph is inconsistent with the reasoning, and findings, of Wilcox J, especially in pars [63] to [72] of his reasons15. It is also inconsistent with what is implied in the reasoning of Branson J and Gyles J. However, there is force in the observation, in the earlier part of the paragraph, that a direct enquiry by a supplier to a government authority, on a matter that possibly could have political implications (in the widest sense), could not necessarily be expected to receive a prompt, direct and unequivocal response. As to the second basis of negligence, Finkelstein J rejected the conclusion that the appellant acted negligently by failing to warn of the presence of the weed "It is practically impossible for crop seed to be completely free of contamination by other seeds, including weed seeds. All growers are aware of this. According to the evidence the accepted practice in the seed industry (a practice which was later codified for members of the trade organisation, the Seed Industry Association of Australia Ltd) was that seed merchants informed purchasers of the presence and species of seed in a lot, if that seed was present by mass of one per cent or more in lawn or turf seed, or five per cent or more in other seed. Each bag of canola seed was labelled 'certified seed, first generation' and on the back of each label was printed 'minimum 99% purity, minimum 85% germination'. The label 15 (1999) 169 ALR 276 at 293-297. 16 (2000) 105 FCR 476 at 507 [111]. 17 (2000) 105 FCR 476 at 507 [113]. alerted growers to the fact that the bag did not contain pure canola seed. In the absence of actual knowledge that the weed seeds were a risk to growers, Dovuro was not obliged to add further information to the label. The label was in accordance with industry practice and there are no facts from which it could be concluded that Dovuro acted unreasonably by confining itself to that practice." Finkelstein J also found that it was not reasonably foreseeable that the Western Australian authorities would react as they did18. Subject to one critical qualification, Gyles J agreed with Finkelstein J. In particular, in considering the issue of duty of care (which he would have allowed the appellant to re-open) he expressed the view that it was not reasonably foreseeable that the Western Australian authorities would act as they did19. He pointed out that they had received certificates of analysis of the seed before it was released for sale, and did not attempt to prevent its release. The critical qualification related to "the apologies and admissions made on behalf of "They were not precise as to the defect, or as to the remedy, and were given in circumstances where an apology can be explained by commercial considerations. It would have been well open to the trial judge not to accept the [growers'] reliance upon them. However, the trial judge had the opportunity of seeing the authors give evidence, and of considering the admissions made against the backdrop of the other evidence. It also needs to be borne in mind that in case of doubt, labelling the goods with the actual MAF analyses was a precaution which was relatively simple and cheap." Gyles J concluded this part of his judgment by saying22: "Thus, whilst the analysis of this issue by Finkelstein J would persuade me as a judge of fact to reject the [growers'] case, in my view the decision below was open to the trial judge and should not be disturbed." 18 (2000) 105 FCR 476 at 506 [109]. 19 (2000) 105 FCR 476 at 530-531 [188]-[191]. 20 (2000) 105 FCR 476 at 539 [220]. 21 (2000) 105 FCR 476 at 540 [221]. 22 (2000) 105 FCR 476 at 540 [222]. In the result, therefore, in the Full Court, Finkelstein J, having analysed the facts, rejected the claims of negligence. Gyles J would have done the same "as a judge of fact" but he considered the trial judge's finding was "open ... and should not be disturbed" because of the apologies and admissions. Branson J upheld the second finding of negligence on the basis of the apologies and admissions. Since the outcome in the Full Court turned upon the admissions, it becomes important to consider exactly what they amounted to. Two were quoted by Branson J, and referred to by Gyles J. The first was a media release23: "We apologise to canola growers and industry personnel. This situation should not have occurred but due to strong interest in Karoo the unusual step was made of undertaking contract seed production in New Zealand to assist rapid multiplication; whilst the urgency to process and distribute the seed of Karoo in time for planting caused additional time pressures." The second was a letter24: "I'd like to stress at this stage that this does not excuse Dovuro in failing in its duty of care to inform growers as to the presence of these weed seeds. We got it wrong in this case, and new varieties will not be brought on the market again in this manner. Dovuro will not be producing seed in New Zealand again. The company will continue in bulking up its varieties (as it does every year) in Western Australia." Those communications were regarded as supporting, by admission, at least the second basis upon which Wilcox J found negligence, that is to say, that the appellant should have informed growers (and, perhaps, through them, the authorities) that the canola seed contained the weed seeds in question. The proposition that the appellant (by labelling or otherwise) should have informed the growers of the presence of the three weeds in question, and that failure to do so involved negligence, depends upon the premise that such information would have been of concern to the growers. In another part of his reasoning, Gyles J pointed out25 that there was no evidence, from any local agronomist or seed merchant, that, at the time of sale, there was concern about 23 (2000) 105 FCR 476 at 481 [8]. 24 (2000) 105 FCR 476 at 481 [10]. 25 (2000) 105 FCR 476 at 536 [209]. cleavers, redshank or field madder of such a kind as would have led growers to do anything. To an extent, that undermines the reliance he placed on the admissions, as does his opinion, expressed in the context of duty of care, as to the foreseeability of the reaction of the Western Australian authorities. However, the evidence showed that at least some officers of the Western Australian governmental authority were very concerned about the introduction of some of the weeds in question. It is correct, as Gyles J pointed out, that it would have been easy and inexpensive to tell the growers of the weeds; and presumably the appellant had good cause to regret not having done so. But in the absence of a finding that, if the growers had been told, they would have been concerned about it, that proposition does not establish actionable negligence. However, while it is correct to say that there was no such evidence from any local agronomist or seed merchant, as to concern in the industry, there was evidence, referred to by Wilcox J in the context of damage, that went some distance towards establishing the fact. The quality of the evidence is less than completely compelling, but it is there. It was discussed by Wilcox J as follows26: "Mr Wilkins said in his affidavit: 'Had I been warned that the Karoo canola seed available to fill my orders in 1996 may have contained weeds which were not known to broad acre farming in the State of Western Australia, I would have refused to accept that seed in satisfaction of my orders because it was not worth all the hassle.' Mr Wilkins was not challenged in relation to that statement. In cross- examination, he conceded he knew there would always be some impurities in bags of seeds purchased from dealers, but he added 'most of them were listed on the bag'. However, Mr Wilkins agreed he knew in April 1996 that impurities were not always listed; so that, in buying seeds, he would 'buy weeds from time to time as well'. Evidence was also given by Bruce Leslie Piper. Mr Piper conducts a farming operation in partnership with five other members of his family at 'Woolandoon', Bindi Bindi. The partnership purchased and sowed Karoo canola seed imported by Dovuro from New Zealand in early 1996. Mr Piper said, without challenge, that he would not have used the Karoo canola seed if he had known of the possibility of its contamination with weeds not known in Western Australia. Mr Piper also gave evidence of losses and expenses sustained in following the recommendations set out in the information package. I need not go into detail. Bearing in mind the number of people in each of the two partnerships (Wilkins and Piper), I 26 (1999) 169 ALR 276 at 290 [50]-[51]. am satisfied at least seven persons suffered damage as a result of sowing the Karoo canola seed, the amount of which has yet to be quantified." The reference to "all the hassle" appears to be to the sensitivity of the agricultural authorities to the introduction of certain kinds of weed, and the possibility that they would respond, to the cost of growers, as they did in this case. It was an (unchallenged) assertion by Mr Wilkins that he would have foreseen the kind of thing that actually occurred. I agree with what is said by Gummow J as to the care that needs to be taken in identifying the precise significance of admissions, especially when made by someone who has a private or commercial reason to seek to retain the goodwill of the person or persons to whom the admissions are made. Common sense may dictate that they be used with caution by a fact-finder. And it is always necessary for the fact-finder to consider precisely what it is that is being admitted. If the driver of a motor vehicle says to an injured passenger: "I am sorry, I let you down", that may not mean much, or anything. If the driver says: "I am sorry, I was going too fast", that may be very significant. The statement that the appellant "[failed] in its duty of care to inform growers as to the presence of these weed seeds" cannot be an admission of law, and it is not useful as an admission of failure to comply with a legal standard of conduct. There is no evidence that the author of the statement knew the legal standard. But there were important factual questions on which there was other evidence, that is to say, whether telling the growers of the presence of the weeds would have served any useful purpose, or had any practical effect in avoiding the harm they suffered, and whether the presence of such seeds would have been a matter of concern to them. Those were facts to be decided in the light of the commercial and regulatory context in Western Australia at the time. The author of the letter, Mr Rath, was the manager of the appellant's Western Region. The statement by Mr Rath that there was no excuse for the appellant's failure to inform growers of the presence of the weed seeds was significant, because it enabled Wilcox J, in evaluating the evidence of officers of the agricultural authorities, and of growers, more readily to reach the conclusion that the presence of the weeds would have been of concern to those people. In the result, as in the case of Graham Barclay Oysters Pty Ltd v Ryan, while I accept the force of the dissenting opinion in the Full Court, I am not satisfied that the majority view involved clear error or injustice, and I would not disturb the concurrent findings of negligence. The appeal should be dismissed with costs. McHugh 28 McHUGH J. In the view that I take of this case, the issue for determination is whether the appellant, Dovuro Pty Ltd ("Dovuro"), breached the duty of care that at the trial it conceded it owed to the first respondents ("the Wilkins interests"). Dovuro also seeks to raise an issue as to whether it did owe any duty of care to the Wilkins interests. I would not permit it to raise that issue. It is beyond doubt that a manufacturer of any product owes a duty to a consumer to take reasonable care to prevent the product causing injury or loss to the consumer. As the facts in other judgments demonstrate, Dovuro's position was identical in principle with that of such a manufacturer. Because that is so, the only issue for determination at the trial – as the concession of Dovuro acknowledged – was whether it had breached that duty. This was not a case where there was any basis for contending that the losses suffered by the consumers might fall outside the ordinary duty owed by a manufacturer to a consumer. It was not a case where the Wilkins interests could succeed only on proof of a special duty to prevent economic loss to them. A manufacturer breaches its duty of care if, by exercising reasonable care, it should have foreseen and avoided the loss. Like Gummow, Hayne and Callinan JJ, I find that Dovuro did not breach the duty of care that it owed. Accordingly, I agree with their Honours that the appeal should be allowed. The facts and issues in this case are set out in other judgments. The case for the Wilkins interests depended upon obtaining a finding that Dovuro ought to have known that selling Karoo seed in Western Australia gave rise to a reasonably foreseeable risk that purchasers of the seed would suffer damage by reason of three plants, the seeds of which were mixed with the Karoo seed, becoming declared plants. In my opinion, that risk was not reasonably foreseeable. In the Full Court of the Federal Court, Gyles J pointed out27: "[T]here was no evidence that the weeds in question, particularly cleavers, were or should have been known to have been of concern at the relevant time and place. The weeds were not revealed as being of concern under the comprehensive regulatory system. There was no evidence led by [the Wilkins interests] from any local agronomist or seed merchant to establish that there was concern about the weeds. No publicly available literature was tendered to establish that fact. No textbook was tendered. There was no bulletin from AgWest or any other Department of Agriculture warning of the risk." 27 (2000) 105 FCR 476 at 536. McHugh If the presence of cleavers, redshank and field madder was understood at the relevant time to constitute a risk to Western Australian agriculture, one would have thought that evidence concerning these matters would have been available and tendered. The lack of evidence indicates that, at the time of sale of the Karoo seed, the presence of these "plants" or weeds was not perceived by anybody as constituting a threat to agriculture in Western Australia or for that matter in Australia. If negligence law is to serve any useful social purpose, it must ordinarily reflect the foresight, reactions and conduct of ordinary members of the community or, in cases of expertise, of the experts in that particular community. To hold defendants to standards of conduct that do not reflect the common experience of the relevant community can only bring the law of negligence, and with it the administration of justice, into disrepute. That is not to say that a defendant will always escape liability by proving that his or her conduct was in accord with common practice. From time to time cases will arise where, despite the common practice in a field of endeavour, a reasonable person in the defendant's position would have foreseen and taken steps to eliminate or reduce the risk that caused harm to the plaintiff. But before holding a defendant negligent even though that person has complied with common practice, the tribunal of fact had better first make certain that it has not used hindsight to find negligence. Compliance with common practice is powerful, but not decisive, evidence that the defendant did not act negligently. And the evidentiary presumption that arises from complying with common practice should be displaced only where there is a persuasive reason for concluding that the common practice of the field of activity fell short of what reasonable care required. The present case is not a case of common practice in the usual sense of that term. But it is analogous to it. Dovuro imported and sold a product whose importation into Australia was authorised by the Australian Quarantine and Inspection Service and whose importation into Western Australia was authorised by the Western Australian Quarantine and Inspection Service. In other words, it was doing what sellers of seed ordinarily do. It had no reason to think that in importing the seed it was running the risk that cleavers, redshank and field madder would be declared by the Agriculture Protection Board, with consequent financial loss to the purchasers of Karoo seed. In contemplating the risk of harm from the sale of Karoo seed, a reasonable person would have regarded the risk as so negligible that it could be disregarded. Accordingly, there was no reasonably foreseeable risk of damage to the Wilkins interests. Even if the presence of the weeds had given rise to a foreseeable risk of damage that a reasonable person would not have disregarded, orthodox negligence doctrine required a further question to be answered before there could be a finding of negligence against Dovuro. Did reasonable care require Dovuro to take steps to avoid that risk, a risk that, by hypothesis, could not be McHugh disregarded? The answer to that question depended on how a reasonable person would respond after considering the magnitude of the risk, the probability of it occurring and the expense, delay and inconvenience in taking such steps28. The learned primary judge said that "it would not have taken any significant time for an officer of Dovuro to contact the Weed Seeds Unit of AgWest ... and obtain advice on the acceptability of the foreign seeds identified" in the Karoo seed29. But the failure to contact the Unit did not itself make Dovuro negligent. A plaintiff must show not only that an alternative course of conduct was open to the defendant, but that it would have eliminated or reduced the risk of damage. With the benefit of hindsight, it is now apparent that the Unit would probably have taken steps to have the three plants declared. But the position must be judged in the light of what Dovuro knew at the time and what reasonable choices were open to it. A defendant is not negligent merely because it fails to take an alternative course of conduct that would have eliminated the risk of damage. The plaintiff must show that the defendant was not acting reasonably in failing to take that course. If inaction is a course reasonably open to the defendant, the plaintiff fails to prove negligence even if there were alternatives open to the defendant that would have eliminated the risk. So negligence would not have been established by proving that a reasonable person would have foreseen some risk that the Agriculture Protection Board would have declared the three plants to be declared plants. Dovuro would not have been negligent if the risk of a declaration being made – though reasonably foreseeable – was so small that reasonable care did not require it to incur the delay and expense of contacting the Unit and waiting for its answer. Because I have held that the risk was so negligible that it could be disregarded, the question of the probability of the risk occurring does not arise. It is therefore not possible to calculate what the response of a reasonable person would have been if the risk was sufficiently significant to require Dovuro to consider the expense and delay of not selling the Karoo seed until it received the Unit's answer. But I mention it because it should not be thought that a finding of negligence in this case would automatically follow from a finding that the risk of damage was reasonably foreseeable. Finally, I agree, for the reasons given by Gummow J, that the "admissions" in the correspondence from Dovuro provide no basis for a finding of negligence on the part of Dovuro. 28 cf Wyong Shire Council v Shirt (1980) 146 CLR 40 at 46. 29 (1999) 169 ALR 276 at 308. McHugh Order The appeal should be allowed. History of the proceedings The essential facts fall within a narrow compass. The appellant, Dovuro Pty Ltd ("Dovuro"), is a producer and distributor of agricultural seed, including, amongst others, Karoo canola seed. Karoo canola seed is a strain of canola (Brassica napus) designed to tolerate the otherwise harmful effects of triazine, a herbicide commonly used to control the spread of wild radish (a weed prevalent in canola crops in many parts of Australia). On 8 September 1995, Dovuro and Crop Marketing New Zealand Society Ltd ("Cropmark") entered into a contract under which Cropmark agreed to cultivate and sell approximately 250 tonnes of Karoo canola seed to Dovuro. The canola seed was duly cultivated in various localities in New Zealand and was harvested in March 1996. The seed was then cleaned and packed into 25 kg bags by a contractor to Cropmark, Seedlands NZ Ltd, and delivered to Dovuro at sites in Melbourne and Fremantle. A label attached to each bag contained the statement "Minimum 99% Purity; Minimum 85% Germination". The statement reflected seed analysis certificates issued by the New Zealand Ministry of Agriculture and Fisheries. These certified that the Karoo canola seed was 99.8 per cent or 99.9 per cent pure (depending on the sample taken) and that it "[c]omplie[d] with the Seeds Acts of all Australian States". Of the total quantity of 168 tonnes (6720 bags) sent to Dovuro from New Zealand, 67.5 tonnes (2700 bags) were made available in Western Australia and were resold to local suppliers, including Elders Ltd ("Elders"). The first respondents, a family partnership trading as R & E Wilkins ("the Wilkins"), conduct a farming and grazing business at Kondinin, Western Australia. In May 1996, Elders supplied 40 bags of the Karoo canola seed to Mr Trevor Wilkins at the family property, "Narbethong". Mr Wilkins sowed 278 hectares of Narbethong with the seed and 238 hectares eventually returned a good Karoo canola crop (40 hectares having failed due to lack of moisture). to Western Australian canola growers, However, on 9 July 1996, Agriculture Western Australia ("AgWest"), the State government department responsible for agricultural matters, issued an information package including Mr Wilkins. The package enclosed a letter from the Manager of AgWest's Pulses and Oilseeds Program indicating that the Karoo canola seed imported from New Zealand by Dovuro had been found to contain "undesirable weeds" including cleavers (Galium aparine), redshank (Polygonum persicaria) and field madder (Sherardia arvensis). Each of these species had been prohibited from importation and sale in Western Australia four days earlier on 5 July 1996. The information package also setting out AgWest's recommendations as to the most effective methods for controlling the three weeds. These methods involved the thorough cleaning of windrowers and included a booklet headers used in affected paddocks, the cessation of livestock grazing in the affected paddocks, and the destruction of seed derived from the affected paddocks for a period of at least five years. On 7 April 1998, the Wilkins instituted proceedings against Dovuro in the Federal Court of Australia alleging negligence and contravention of s 52 of the Trade Practices Act 1974 (Cth) ("the Act"). The Wilkins brought their proceedings under Pt IVA of the Federal Court of Australia Act 1976 (Cth) on behalf of themselves personally and as representative of other farmers who, in 1996, purchased and seeded Karoo canola seed supplied by Dovuro to distributors in Western Australia and which allegedly included cleavers, redshank and field madder seeds. Subsequently, on 4 September 1998, Dovuro filed a cross-claim against Cropmark. On 23 November 1998, the Wilkins filed an amended application and amended statement of claim in which they named Cropmark as second respondent. On 12 March 1999, Cropmark filed a cross- claim against Dovuro. Issues of liability were tried in advance of questions of damages. Wilcox J made a finding that Dovuro was negligent in failing to disclose the presence of the weed seeds in the Karoo canola which it imported from New Zealand30. However, his Honour found that Dovuro had not contravened s 52 of the Act. An action against Cropmark for negligence also failed and each cross- claim was dismissed. A majority of the Full Federal Court (Branson and Gyles JJ; Finkelstein J dissenting) dismissed Dovuro's appeal against the finding of negligence31. Dovuro subsequently moved the Full Court for reconsideration of its orders on the basis that a majority of the Court had agreed that the primary judge's conclusions concerning Dovuro's liability for negligence were in error. Cropmark sought leave to make further submissions and amend its defence to Dovuro's cross-claim. The Full Court dismissed both applications32. Reasoning of the primary judge The approach taken by the primary judge was premised on a concession made by Dovuro at the conclusion of the trial in respect of a duty of care. The summary of Dovuro's submissions provided at the conclusion of the hearing stated, in part, that "Dovuro concedes it owed Wilkins a duty to take reasonable care". However, Wilcox J recorded the concession as follows33: 30 Wilkins v Dovuro Pty Ltd (1999) 169 ALR 276 at 311. 31 Dovuro Pty Ltd v Wilkins (2000) 105 FCR 476. 32 Dovuro Pty Ltd v Wilkins (No 2) (2001) 107 FCR 104. 33 (1999) 169 ALR 276 at 302. "Dovuro accepts it was under a duty of care to those to whom it supplied the seed in relation to its nature and the quality; the question is whether it breached that duty." (emphasis added) That much may be accepted so long as it is remembered that Dovuro resold its seed to local suppliers, such as Elders, and had no direct commercial relationship with the first respondents. Later in his Honour's reasons, the concession is recorded again, this time consistently with Dovuro's summary of submissions34: "As indicated, Dovuro concedes the existence of a duty of care to [the Wilkins] and group members; but it denies breach of duty." Wilcox J, with apparent approval, also quoted par 16.2 of the Wilkins' written submissions as follows35: "Both [Dovuro and Cropmark] had a duty to the consumers of the seed to exercise reasonable care not to expose the consumers to a risk of injury of which they knew or ought to have known." In the Full Court, Branson J framed the concession in terms that Dovuro "owed to Wilkins and the group members a duty to take reasonable care to avoid injury to them"36, while Finkelstein J noted37: "At the commencement of his final speech at trial, counsel for Dovuro conceded that his client 'owed Wilkins a duty to take reasonable care', but denied that it had breached the requisite standard of care. The content of the conceded duty was not described. However, having regard to the allegations made against Dovuro (both in pleadings and orally) it must be taken to have been accepted that Dovuro owed the Wilkins' interests and other purchasers of its canola seed, a duty to exercise reasonable care to avoid a risk of injury such as would be owed by a manufacturer or a distributor of a defective product who knew or ought reasonably to have known that his products might cause injury." It is apparent that both the primary judge and the Full Court proceeded on the assumption that Dovuro had conceded that it owed a duty to the consumers of the 34 (1999) 169 ALR 276 at 305. 35 (1999) 169 ALR 276 at 304. 36 (2000) 105 FCR 476 at 487. 37 (2000) 105 FCR 476 at 498. seed to exercise reasonable care not to expose those consumers to a risk of injury of which Dovuro knew or ought to have known. The existence of a concession in respect of a duty of care enabled Wilcox J to proceed directly to a consideration of whether Dovuro had breached that duty. This appeal primarily turns on the cogency of the primary judge's reasoning in that respect. If the finding of breach cannot be upheld, it will be unnecessary to rule on the submissions respecting the concession and the existence of the duty of care. The federal and State regulatory regimes Before turning further to consider the reasoning of the primary judge, it is convenient to consider the statutory regimes within which the importation of Karoo canola seed by Dovuro took place. Necessary approvals for importation were given by the federal and State authorities. The importation of plant matter into Australia is the subject of a comprehensive system of federal and State regulation. This is usefully summarised in an appendix to the judgment of Gyles J in the Full Court38. At a federal level, the Customs Act 1901 (Cth) ("the Customs Act"), the Customs (Prohibited Imports) Regulations 1956 (Cth), the Quarantine Act 1908 (Cth) ("the Quarantine Act") and the Quarantine (Plants) Regulations 1935 (Cth) (repealed by the Quarantine Regulations 2000 (Cth)) play a significant role. Of particular relevance is s 13(1)(f) of the Quarantine Act, which provides that the Governor-General may, by proclamation, prohibit the importation into Australia of any plants, or parts of plants39. ("Plant" is, itself, defined in s 5 to include "any part of a plant" and would presumably include plant seeds.) At the relevant time, s 67(1) of the Quarantine Act stated: "No person shall knowingly import, or bring into any port or place in Australia … any … plant, or any part of any … plant, in contravention of this Act, the regulations or any proclamation under this Act." In addition, s 51 of the Quarantine Act provided that, until released from quarantine, no plant imported into Australia might be moved, dealt with, or interfered with, except by authority and in accordance with that Act and its regulations40. Section 53(1) empowered quarantine officers to examine any plant 38 (2000) 105 FCR 476 at 543-546. 39 See also s 50 of the Customs Act, prior to the section's repeal by the Quarantine Amendment Act 1999 (Cth). 40 Section 51 was repealed by the Quarantine Amendment Act 1999 (Cth). imported into Australia which had not been released from quarantine. That power of inspection also applied to imported plants that had been released from quarantine41. Finally, a quarantine officer was empowered to order into quarantine any imported plant which, in his or her opinion, was, or was likely to be, infected with a disease affecting animals or plants, or which contained, or appeared to contain, any insect, pest or disease agent42. "Pest" was defined to include "weed pest"43. Several points may be noted in respect of the application of the above legislation to the present proceedings. First, it is common ground that at no stage during the importation of Karoo canola seed by Dovuro were the seeds of cleavers, redshank or field madder prohibited from importation into Australia pursuant to any Commonwealth statute or regulation. On the contrary, the evidence indicated that cleavers, redshank and field madder were common in the eastern States of Australia, and were also present in certain sections of Western Australia. Secondly, once Dovuro's Karoo canola seed arrived in Western Australia, it was held in quarantine pursuant to the provisions of the Quarantine Act. While in quarantine, samples of the seed were taken by the Australian Quarantine and Inspection Service for analysis. The seed was subsequently released from quarantine on completion of tests carried out in accordance with the International Seed Testing Analysis rules. Thirdly, although the Quarantine (Plants) Regulations in force at the time of the importation of the Karoo canola seed by Dovuro also made detailed provision for seeds, including a prohibition on the importation of "seed" into Australia unless the importer was the holder of a permit issued by the Director of Quarantine44, the definition of seed contained in the Regulations did not include the seed of cleavers, redshank or field madder. The absence of the weed seeds from the list of seeds prohibited from importation without a permit is a further indication that cleavers, redshank and field madder were not considered a material threat to the Australian agricultural industry. The importation of these three seeds could therefore be carried out without a permit, although they would otherwise be subject to the provisions of the Quarantine Act. A further system of regulation is imposed in Western Australia. Of particular significance are the Seeds Act 1981 (WA) ("the Seeds Act") and the Agriculture and Related Resources Protection Act 1976 (WA) ("the Protection Act"). Part III of the Seeds Act is headed "Unsaleable seed". Section 12(1) 42 s 55A. 44 Quarantine (Plants) Regulations, reg 21.F.(2). provides that the Minister may declare seed to be "prohibited seed" for the purposes of that Act. Section 13 prohibits a person from selling a seed lot containing "any prohibited seed". A concomitant power is enjoyed by the Agriculture Protection Board of Western Australia, which may declare plants to be "declared plants", with the result that such plants may not be introduced into the State45. Section 26(1)(b) of the Seeds Act empowers the Governor of Western Australia to make regulations "prescribing seed to be weed seed". Weed seed may still be sold and imported into Western Australia. However, one consequence of such a prescription is that a person selling a seed lot containing 2 per cent or more of a particular seed must attach a label to the seed package indicating, in respect of any weed seed contained in the seed lot, the name (or names) of the weed seed and the maximum proportion in which that weed seed is contained in the seed lot (expressed as a number of seeds per mass of the seed lot)46. During the period of time in which Dovuro imported the Karoo canola seed into Western Australia and resold it to local suppliers, neither cleavers, redshank nor field madder had been declared "prohibited seeds" by the Minister pursuant to s 12 of the Seeds Act. Nor had any of the three seeds been declared a "declared plant" by the Agriculture Protection Board pursuant to s 35 of the Protection Act. In addition, there was no evidence before the primary judge that cleavers, redshank or field madder had been declared "weed seeds" by the Governor of Western Australia47. For that reason, there is no suggestion that the labelling of Karoo canola seed bags sold to local suppliers by Dovuro contravened the Western Australian legislative requirements. Breach of duty For present purposes, it is unnecessary to consider whether Dovuro should be permitted now to withdraw the concession that, as ultimately formulated by the primary judge, it owed a duty to the consumers of its Karoo canola seed to exercise reasonable care not to expose those consumers to a risk of injury of which Dovuro knew or ought to have known. The question therefore becomes whether the primary judge erred in holding that Dovuro breached that duty. 45 Protection Act, ss 35, 72. 46 ss 7(1), 7(2)(e). 47 cf Seeds Regulations 1982, Third Schedule. In Wyong Shire Council v Shirt, Mason J emphasised48: "In deciding whether there has been a breach of the duty of care the tribunal of fact must first ask itself whether a reasonable man in the defendant's position would have foreseen that his conduct involved a risk of injury to the plaintiff or to a class of persons including the plaintiff." That passage was relied upon by the majority in Graham Barclay Oysters Pty Ltd v Ryan49 as a basis for allowing the appeal by the oyster growers. A risk is real and foreseeable if it is not far-fetched or fanciful, even if it is extremely unlikely to occur50. The precise and particular character of the injury or the precise sequence of events leading to the injury need not be foreseeable; it is sufficient if the kind or type of injury was foreseeable, even if the extent of the injury was greater than expected51. Nevertheless, at bottom, the criterion remains one of "reasonable foreseeability"; liability is to be imposed for consequences which Dovuro, judged by the standard of the reasonable man, ought to have foreseen52. The critical passage in Wilcox J's reasons is as follows53: "It should have been readily evident, especially to a person trained in agricultural science, that it would be impossible for any regulatory authority to anticipate by declaration every exotic weed that might enter Western Australia and turn out to be a threat to Western Australian agriculture, if introduced to the wheatbelt. It should have been equally apparent that the concept of 'weed of agriculture' is necessarily limited to plants that have already proved a problem in the agricultural areas of the 48 (1980) 146 CLR 40 at 47. 49 (2002) 77 ALJR 183 at 196 [58], 205 [106], 220 [190]-[191]; 194 ALR 337 at 354, 50 Wyong Shire Council v Shirt (1980) 146 CLR 40 at 48. 51 Chapman v Hearse (1961) 106 CLR 112 at 120-121. See also Perre v Apand Pty Ltd (1999) 198 CLR 180 at 248-249 [185]-[186]; Rosenberg v Percival (2001) 205 CLR 434 at 455 [64]. 52 Perre v Apand Pty Ltd (1999) 198 CLR 180 at 249 [186]. See also Overseas Tankship (UK) Ltd v Morts Dock & Engineering Co Ltd (The Wagon Mound) [1961] AC 388 at 423. 53 (1999) 169 ALR 276 at 310-311. State; it could provide no guidance about plants, that might prove to be a problem if introduced into those areas. And the possibility of that occurring would have been obvious to anybody with even a superficial knowledge of Australian agriculture and agricultural history. Many of our worst agricultural and environmental scourges are plants and animals that are useful, ornamental or, at least, innocuous in their native habitat and had no reputation as pests before arriving in Australia." (original emphasis) His Honour also accepted the balance of the Wilkins' contentions on breach, including par 16.10, which stated that54: "It was foreseeable the State government would take action to contain, evaluate and deal with the potential threat to the canola seed and oil market. The action taken by the government and the response by [the Wilkins] was what might reasonably be expected." In their reasons, Hayne and Callinan JJ, with reference to the critical passage in the judgment of the primary judge, demonstrate the flawed reasoning involved in proceeding from the proposition that an introduced plant may prove to be a weed to the conclusion that, because cleavers, redshank and field madder were introduced, it should have reasonably been foreseeable to Dovuro that the authorities might treat them as weeds. Moreover, as their Honours also emphasise, a conclusion that Dovuro acted without reasonable care may be supported only if it were open to the primary judge to conclude that Dovuro should reasonably have foreseen that under the State legislation the three plants would or might be declared to be prohibited. Indeed, as McHugh J demonstrates, even that conclusion would not establish negligence on the part of Dovuro absent further findings, with reference to what Dovuro then knew or ought to have known, that the risk was sufficiently significant to require Dovuro to consider refraining from selling Karoo canola seed until it had contacted AgWest and received an answer, and that Dovuro acted unreasonably in failing to take that course. Further, in the Full Court, Finkelstein J approached the matter in a fashion with which I agree. He said55: "The question the trial judge had to consider was whether it was foreseeable that the three weeds, cleaver, redshank and field madder, which were not known to be dangerous and which were not proven to be dangerous, would be declared to be prohibited weeds that were to be 54 (1999) 169 ALR 276 at 305. 55 (2000) 105 FCR 476 at 506-507. eradicated in 1996 shortly after they were imported. In circumstances where no similar action had ever been taken by an Australian government, it is impossible to answer this question in the affirmative." The primary judge erred in considering what would readily be apparent to an agricultural scientist when determining the standard of care owed to the Wilkins by a seed merchant, in this case, Dovuro. Nor was his Honour correct in relying on what would have been obvious to a person with a "superficial knowledge of Australian agriculture and agricultural history" given that, in the present circumstances, governmental experts in the field of agricultural protection had taken no steps to prohibit the importation or sale of the three seeds. The absence of any decision by the federal authorities to prohibit the sale or importation of the three species of seeds, notwithstanding that approximately 90 other species of weed seed were prohibited by the Commonwealth at the time Dovuro imported the impugned Karoo canola seed into Australia, is significant. It suggests that the presence of cleavers, redshank and field madder was not understood to be a material threat to Australian agriculture. A similar point may be made in relation to the absence at the material time of any decision by the Western Australian Government to prohibit the seeds or declare them to be "weed seeds" pursuant to the legislation outlined earlier in these reasons. Moreover, if, as the primary judge suggested, it would be impossible for a regulatory authority to anticipate every exotic weed that might enter Western Australia and turn out to be a threat to Western Australian agriculture, it is difficult to justify the imposition of an equivalent standard of care on a seed merchant in the position of Dovuro. Gyles J noted, in a passage in his reasons with which I agree56: "[T]here was no evidence that the weeds in question, particularly cleavers, were or should have been known to have been of concern at the relevant time and place. The weeds were not revealed as being of concern under the comprehensive regulatory system. There was no evidence led by [the Wilkins] from any local agronomist or seed merchant to establish that there was concern about the weeds. No publicly available literature was tendered to establish that fact. No textbook was tendered. There was no bulletin from AgWest or any other Department of Agriculture warning of the risk." "Admissions" In joining in the order dismissing Dovuro's appeal before the Full Court, notwithstanding his favourable conclusions on other issues, Gyles J placed 56 (2000) 105 FCR 476 at 536. particular reliance on the existence of correspondence from Dovuro. This, in his Honour's view, amounted to an admission by Dovuro that it had breached the duty of care which it owed to the Wilkins57. The primary judge placed similar weight on the correspondence in holding Dovuro liable for negligence at first instance58. The first respondents submit that this Court should also give significant weight to that correspondence. For present purposes, it is sufficient to refer to two pieces of correspondence said to contain "admissions" of liability. The first is a media release entitled "Weed Seeds in Karoo" which was issued by Mr William Tapp, the General Manager of Dovuro, in July 1996. The media release read, in part, as follows: "Weed seeds of Galium aparine (cleavers) and Polygonum persicaria (redshank), have been detected in certified seed of the triazine-resistant canola cultivar 'Karoo' imported from New Zealand in April/May 1996 … We apologise to canola growers and industry personnel. This situation should not have occurred but due to strong interest in Karoo the unusual step was made of undertaking contract seed production in New Zealand to assist rapid multiplication". (emphasis added) The second piece of correspondence is a letter from Mr Eamonn Rath, Dovuro's Western Region Manager, to Mr K Norman of the Jerramungup Extension and Advisory Commission, a local grower based organisation. A copy of the letter appears to have also been sent to a number of officials in AgWest. The letter included a section entitled "Dovuro's role", in which the following was noted: "I'd like to stress at this stage that this does not excuse Dovuro in failing in its duty of care to inform growers as to the presence of these weed seeds. We got it wrong in this case, and new varieties will not be brought on the market again in this manner." (emphasis added) What did these statements admit? A statement on behalf of a corporation that it has "failed in its duty of care" involves the proposition that the facts demonstrate that the corporation failed a standard fixed by law. In Grey v Australian Motorists & General Insurance Co Pty Ltd59, Mahoney JA referred to Allen v Roughley60 for the proposition that a defendant may admit another person 57 (2000) 105 FCR 476 at 539-540. 58 (1999) 169 ALR 276 at 285-287, 311. 59 [1976] 1 NSWLR 669 at 684. 60 (1955) 94 CLR 98. has a good title to particular land. Thereafter, in Jones v Sutherland Shire Council61, Mahoney JA observed that "[a] party to litigation may make an admission, not only of a fact, but also a conclusion from facts, a mixture of fact and law, or even of law" (emphasis added). The emphasised portions of that statement state the proposition too widely. Admissions on the pleadings are one thing. Modern rules of court commonly provide that a party may, by its pleading, raise any point of law62. That which is so raised may be admitted. But that is not the present case. Certainly a party may admit the facts from which a conclusion of law may then be drawn. The detailed statement made in support of the primary application under the Real Property Act 1900 (NSW) by the defendant in Allen v Roughley63, as to the history of the occupation of the land in question, may be an example. The real significance of the admission made in Allen v Roughley was, as Kitto J pointed out64, that, following Lustre Hosiery Ltd v York65, it was properly received in evidence notwithstanding that the defendant had no direct knowledge of all of the facts and had relied upon the statements of others. Different questions arise where, as here, the suggested admission includes a conclusion which depends upon the application of a legal standard. In Grey66, Glass JA considered an admission sought from a witness to the effect that he had assigned certain choses in action at law or in equity. His Honour said67: "By extorting from a party an admission that he was negligent, or that he was not provoked, or that his grandfather possessed testamentary capacity, there is added to the record something which is, not merely of dubious value, but by definition valueless, owing to the witness' unfamiliarity with the standard governing his answer." 61 [1979] 2 NSWLR 206 at 231. See also Pitcher v Langford (1991) 23 NSWLR 142 62 For example, Federal Court Rules, O 11 r 9. 63 (1955) 94 CLR 98 at 141-142. 64 (1955) 94 CLR 98 at 142. 65 (1935) 54 CLR 134 at 138-139. 66 [1976] 1 NSWLR 669 at 675. 67 [1976] 1 NSWLR 669 at 676. That reasoning, which in terms applies to the suggested "admission" by Dovuro, has been applied in cases arising under the Act. In Eastern Express Pty Ltd v General Newspapers Pty Ltd68, a question arose as to whether certain statements amounted to an express admission of a proscribed purpose for the application of s 46 of the Act. Lockhart and Gummow JJ said on that subject69: "As a general proposition, an informal admission as to a matter of fact, by words or conduct which is made by a party or a privy, is admissible evidence against that party of the truth of its contents. The complexity of the construction given in the case law to the ordinary words of s 46 must mean, at the very least, that in this area what is tendered as an express admission is likely to be a statement as to matters of mixed law and fact, rather than simply of fact. In the case of alleged contraventions of s 52 of the Act, admissions by a trader in the course of cross- examination that his conduct was 'misleading' and 'deceptive' cannot be relied upon to usurp the task of the court to judge the legal quality of that conduct70. It is unsettled whether admissions may be made of matters of mixed law and fact71. In [Grey], Glass JA described various decisions accepting admissions by a party as to questions of mixed law and fact as having been given with no regard to principle. In his view, when a standard, measure or capacity is fixed by law, a party cannot be asked to admit a conclusion depending upon the legal standard; however, the witness may be asked to admit facts from which the conclusion of law may be drawn by the court. In our view, that is how the pieces of evidence in issue here should be considered, the question being whether the statements provide material from which his Honour should have drawn a conclusion as to predatory purpose for the purposes of s 46." 68 (1992) 35 FCR 43. 69 (1992) 35 FCR 43 at 68. See also Melway Publishing Pty Ltd v Robert Hicks Pty Ltd (2001) 205 CLR 1 at 13 [16], 14 [21], 19-20 [36]. 70 See Rhone-Poulenc Agrochimie SA v UIM Chemical Services Pty Ltd (1986) 12 FCR 477 at 487-488, 504. 71 See Grey v Australian Motorists & General Insurance Co Pty Ltd [1976] 1 NSWLR 669 at 675, 684-685; Jones v Sutherland Shire Council [1979] 2 NSWLR The so-called "admissions" of officers of Dovuro as outlined in the passages quoted above provide no basis for a finding of negligence in this case. Orders The appeal should be allowed with costs and consequential orders made as proposed by Hayne and Callinan JJ. Kirby KIRBY J. This is another appeal in which, following a lengthy trial and a disposition upon what was substantially a contest of fact, this Court is invited to substitute its own factual evaluation for that reached by the primary judge, with the many advantages that he enjoyed72. Once again plaintiffs, successful at first instance, who have held a favourable decision in the intermediate court, lose in this Court because a different view is taken about the proof of the negligence of the defendant73. In this appeal, the transcript and materials are contained in six appeal books. The primary judge in the Federal Court of Australia (Wilcox J) saw many witnesses give their evidence. He had the responsibility of considering a mass of material, oral and written, concerning a somewhat complicated problem of fact. In earlier times, such a problem would have been decided finally by a jury. Now, this Court, working within the constraints of a final court74, finds error in the primary judge's conclusion that, on the facts, a breach of a duty of care was proved. The appeal presents an added twist. At trial, the appellant conceded that it was under a duty of care to persons in the position of the plaintiffs. In this Court (as it had attempted unsuccessfully to do in the Full Court75), the appellant sought to withdraw that concession. It sought to support a ground of appeal that it did not owe a duty of care to the plaintiffs after all. And there is a second twist, arising in this Court for the first time. Here it is suggested that the declaratory order, made by the primary judge, was invalid as a "form of order not known to the law"76. This is said although no ground of appeal has challenged the validity of the declarations in question. 72 cf Aktiebolaget Hässle v Alphapharm Pty Ltd (2002) 77 ALJR 398 at 415 [85] per McHugh J (diss), 416-417 [95] of my own reasons (diss); 194 ALR 485 at 507- 73 Agar v Hyde (2000) 201 CLR 552 at 584 [92], 601 [128]; Modbury Triangle Shopping Centre Pty Ltd v Anzil (2000) 205 CLR 254 at 268-269 [36], 270 [42], 292-293 [113], 302 [147]; Graham Barclay Oysters Pty Ltd v Ryan (2002) 77 ALJR 183 at 205 [106], 221-222 [194]-[202]; 194 ALR 337 at 366, 388-391; see also Suvaal v Cessnock City Council [2003] HCA 41 at [71]-[76]; Whisprun Pty Ltd v Dixon [2003] HCA 48; cf Luntz, "Torts Turnaround Downunder", (2001) 1 Oxford University Commonwealth Law Journal 95. 74 cf State Rail Authority of New South Wales v Earthline Constructions Pty Ltd (In Liq) (1999) 73 ALJR 306 at 330 [90]-[91]; 160 ALR 588 at 619-620. 75 Dovuro Pty Ltd v Wilkins (2000) 105 FCR 476. 76 Reasons of Hayne and Callinan JJ ("joint reasons") at [143] with the concurrence of Heydon J at [177]. Kirby I approach the appeal with a proper sense of modesty about the capacity of a Court like this, in such a substantial contest, to place itself fairly, in substance, into the position of a primary judge: comprehending, and giving effect to, the entirety of the evidence. The need for a measure of restraint also derives from a perception of the proper, and restricted, role of this Court in such matters, limited as it is, in a true appeal, to the correction of error77. The facts The general nature of the claims brought at trial by the Wilkins (the first respondents) against Dovuro Pty Ltd (the appellant) and Crop Marketing New Zealand Society Ltd (In Liq) (the second respondent) are described in other reasons78. I shall use the same terms to identify the parties, the variety of the canola seed ("Karoo") imported into Australia and supplied by Dovuro to the Wilkins, as well as the three forms of weed with which the Karoo seed in question was affected (namely "redshank", "field madder" and "cleavers"). Unfortunately, in the way the appeal developed (substantially as a retrial in this Court based on the record) it will be necessary for me to refer to more of the evidence and to findings of the primary judge not contained in other reasons. At its highest level of generality (leaving aside claims brought which were rejected at trial and not pursued79), the outline of the case on which the Wilkins succeeded was relatively simple. The Wilkins purchased Karoo seed from a local seed merchant which Dovuro imported into Australia from New Zealand. Dovuro did not actually manufacture or sell the seed, but as other members of this Court point out, it "occupied a position in the chain of distribution … which was not significantly different from that of a manufacturer"80. The seed was labelled "minimum 99% purity". The Wilkins purchased the seed without knowledge that the Karoo included elements of the three weed varieties that were later discovered amongst the Karoo seed. Dovuro, on the other hand, knew of the presence of those weeds in the seed. It failed (1) to draw that presence to the 77 Eastman v The Queen (2000) 203 CLR 1 at 34-37 [108]-[115]; Fox v Percy (2003) 77 ALJR 989 at 995-996 [32]; 197 ALR 201 at 210. 78 Reasons of Gummow J at [42]-[57]; joint reasons at [132]-[149]. 79 Such as the claim of the Wilkins against Dovuro based on an alleged breach of the Trade Practices Act 1974 (Cth), s 52 (see Wilkins v Dovuro Pty Ltd (1999) 169 ALR 276 at 311-313 [113]-[118]); the claim by the Wilkins against Cropmark (see (1999) 169 ALR 276 at 313-317 [119]-[128]) and the cross-claim of Dovuro against Cropmark (see (1999) 169 ALR 276 at 317-321 [129]-[153]). 80 Joint reasons at [155]; see also reasons of McHugh J at [29]. Kirby specific attention of the agricultural authorities of Western Australia and, before importing it, to consult them about any problems which it might present in that State or elsewhere in Australia; and (2) to bring the presence of weeds to the specific notice of the growers who were intended to (and, like the Wilkins, did) purchase and sow the Karoo seed. At the time of the sale of the Karoo to the Wilkins, the three weeds were not "declared", in effect as prohibited weeds, in Western Australia. Later, however, when their presence in the Karoo seed was discovered, the Western They Australian authorities moved promptly to have them prohibited. recommended that all growers who had acquired Karoo seed take action to eradicate the weeds. This course, followed by the Wilkins, necessarily subjected them to costs and expenses. It was to recover damages, relevantly for negligence, to reimburse them for such costs and losses, that the Wilkins brought these proceedings. Dovuro had acquired the Karoo seed in New Zealand from Cropmark which had informed Dovuro of the presence of the weed varieties in the seed. Such weeds were commonly found in New Zealand. They are not prohibited there. Central to the Wilkins' case was that Dovuro had simply relied on the absence of legal restrictions on the importation of seed containing the weeds into (relevantly) Western Australia and for not taking steps to notify the presence of the weeds to those who were foreseeably concerned. Stated in this way, the claim by the Wilkins against Dovuro seems straight-forward enough. In some ways, it resonates with the plaintiffs' claims in Donoghue v Stevenson81 and in Perre v Apand Pty Ltd82. Growers procuring seed from importers are in many ways as reliant upon the importers, who monitor and control the process of growing and importing the seed, as Mrs Donoghue was upon those who bottled and distributed the ginger beer that she purchased in Paisley, to ensure that it did not contain harmful extraneous matter or, if it did, that the presence of such matter was drawn to notice and reasonable steps taken to prevent the ultimate consumer from being harmed as a result. As will appear, the finding of the primary judge in favour of the Wilkins was even less surprising when two additional considerations are taken into account. The first is that, in published materials, authorised by and known to Dovuro, as well as in the formal admission made during the trial, it was accepted that Dovuro owed a duty of care to the Wilkins to ensure that they were not harmed by the nature and quality of the Karoo seed that Dovuro supplied to 81 [1932] AC 562 at 599. 82 (1999) 198 CLR 180. Kirby them83. As well, once the presence of the weeds in the seed became known in Western Australia, and occasioned the urgent retaliatory action that was taken by the State authorities, Dovuro, in a number of communications, in effect apologised to growers for its want of care in introducing the seeds into that State84. It acknowledged that what had happened "should not have occurred". Effectively, it blamed the supply of the weed-contaminated Karoo seed and the way its importation had happened on the intense market pressure for Karoo at the time85. It will be necessary to refer to further facts later. But the foregoing is sufficient to indicate that the primary judge's finding at trial was unremarkable. It was largely factual. It was of a kind that would, of itself, rarely engage the attention of this Court. Essentially, it involved nothing more than the application to largely uncontested facts of the most basic principle of negligence law. The issues In the manner in which the appeal was argued, the following issues arise for decision: Should Dovuro be permitted to withdraw the concession made on its behalf at trial that it owed a duty of care to the Wilkins? If so, is this Court, for the first time, in a position to, and should it, determine whether Dovuro owed the Wilkins a duty of care, and, if so, did Dovuro owe such a duty of care to the Wilkins? If Dovuro did owe a duty of care to the Wilkins (or if that question will not be reopened by this Court and Dovuro is held to its concession at trial) did the primary judge err in finding that Dovuro was in breach of that duty causing damage to the Wilkins? If not, did the primary judge err in law in the order that he made in the form of interlocutory declarations? In light of the answers to the foregoing, did the Full Court err in ordering that Dovuro pay the costs of the Wilkins? 83 (1999) 169 ALR 276 at 302 [90], 305 [97]. 84 (1999) 169 ALR 276 at 285-286 [37]. 85 (1999) 169 ALR 276 at 285-286 [37] quoting a media release issued by Dovuro. Kirby Withdrawal of a concession made at trial Applicable principles: In this Court Dovuro sought to withdraw the concession made at trial that it owed the Wilkins a duty of care for the purpose of the law of negligence. It treated the matter as one that required the consent of this Court to effect the withdrawal. Earlier, it had failed, by majority, to secure the agreement of the Full Court to the course that it proposed86. What are the applicable principles? To some extent, like other branches of procedural law87, the principles appear to have become somewhat more flexible in recent times. This development reflects a contemporary impatience with the rigid application of strict rules of pleading and procedure88. To some extent, in Australia, it may be influenced by an implication from the Constitution that, whilst matters are within the integrated Judicature of the nation, at whatever level, they must be dealt with justly and in accordance with law89. Coinciding with these considerations is the growth of case management and a greater appreciation of the injustices suffered by other litigants when trials are not conducted efficiently90. The determination of applications to reopen concessions made at trial must resolve these and similar competing factors. It must do so in the context of the particular circumstances in which the application arises. In an appeal, an obvious restriction on permitting the withdrawal of a concession made at trial occurs where, by reason of the concession, the evidence has taken a course which it otherwise might not have followed. Where a party would be prejudiced by acting at trial on the faith of a concession formally made by another party, withdrawal will not normally be allowed91. In H Clark (Doncaster) Ltd v Wilkinson92, Lord Denning MR explained this rule as based on 86 (2000) 105 FCR 476 at 487 [38], 498-499 [85]-[86], 527 [180]-[181]. 87 eg the deference given to fact-finding by a trial judge: State Rail (1999) 73 ALJR 306 at 327-330 [87]-[88]; 160 ALR 588 at 615-618. 88 Jackamarra v Krakouer (1998) 195 CLR 516 at 539-543 [66]. 89 cf Gipp v The Queen (1998) 194 CLR 106 at 153-155 [135]-[138]. 90 Queensland v J L Holdings Pty Ltd (1997) 189 CLR 146 at 167-172. 91 The Clifton, Kelly v Bushby (1835) 3 Knapp 375 [12 ER 695]. 92 [1965] Ch 694 at 703 (CA). Kirby a principle of estoppel. Similar reasoning has informed the approach of the House of Lords to such questions93. In this Court, a like principle has been insisted upon, although it is usually explained in terms of the rules of procedural fairness or natural justice94. If a concession withdrew from the field of litigation an issue that might have been affected by evidence, it would normally be unjust (unless repaired by relevant admissions or concessions) to permit a reopening of the issue on appeal. Such cases apart, there remains in every contested application a decision to be made. On the one hand, if all of the facts of possible relevance to the issue have been adduced and the question is a pure question of law or of legal construction, the interests of justice may require that a party be allowed to withdraw a concession and to make submissions on a point of law or construction abandoned below95. Such an approach is hardly surprising. A court is normally obliged to apply the law. Parties do not have the power, by their concessions or agreement, to require a court to do otherwise96. Sometimes, however, by the course followed at trial, a party may put itself beyond rescue. In such a case, although the law remains as it is, that party may be disabled from invoking it97. Even where the issue is one of pure law or of legal construction and its consideration involves no procedural unfairness, a court may nonetheless refuse to allow a party to reopen an issue earlier conceded. The court must weigh the public interest in the finality of litigation; the desirability that appellate courts should normally have judicial findings and reasoning before considering the point; and the need to uphold the efficiency and authority of the judicial process98. 93 Langdale v Danby [1982] 1 WLR 1123 at 1135; [1982] 3 All ER 129 at 140. 94 Suttor v Gundowda Pty Ltd (1950) 81 CLR 418 at 438; Coulton v Holcombe (1986) 162 CLR 1 at 6-8; Banque Commerciale SA, en Liq v Akhil Holdings Ltd (1990) 169 CLR 279 at 283-284, 288, 290, 304-306. 95 Adams v Chas S Watson Pty Ltd (1938) 60 CLR 545; Saffron v Societe Miniere Cafrika (1958) 100 CLR 231 at 240; Port Jackson Stevedoring Pty Ltd v Salmond & Spraggon (Aust) Pty Ltd (1978) 139 CLR 231 at 241; O'Brien v Komesaroff (1982) 150 CLR 310 at 319. 96 Roberts v Bass (2002) 77 ALJR 292 at 320-321 [143]-[144]; 194 ALR 161 at 199. 97 cf Commissioner of State Revenue (Vict) v Royal Insurance Australia Ltd (1994) 182 CLR 51 at 69. 98 Council of the Borough of Randwick v Australian Cities Investment Corporation [1893] AC 322 at 325 (PC); North Staffordshire Railway Co v Edge [1920] AC 254 (Footnote continues on next page) Kirby It has been suggested that some of the earlier decisions, amenable to permitting issues of law and construction to be argued absent prejudice, represent "words … uttered in another age and in other circumstances"99. The more urgent contemporary demands for case management and efficiency indeed suggest the need to reconsider some of the earlier dicta100. On the other hand, such considerations do not override the duty of Australian courts to the law and to the determination of justice as between the parties according to law101. Especially in a lengthy and complex trial, it is easy enough for a point of law or construction to be overlooked or mistaken. Because judicial decisions are not mechanical but affect the interests of parties (and often express the law in ways important for other or later litigants) cases continue to arise where concessions at trial are seen to have been erroneous, unnecessary or unwise. So long as the appellate court can safely decide the point, taking into account the reasons that exist for denying it consideration, this Court would rarely interfere so as to require a different conclusion102. The Full Court's decision: The Full Court divided on Dovuro's application to revive the contention, as originally pleaded, that it owed no duty of care to the Wilkins. A majority (Branson and Finkelstein JJ) refused to permit the withdrawal of the concession. However, Gyles J dissented on this point103. From the reasons of the judges in the Full Court and the argument in this Court, it emerges that the substantive basis for permitting a withdrawal of the concession and the reargument of the duty of care was: that the concession was only made at trial at the commencement of the final address by counsel for Dovuro and then in very general terms104; at 263-264; United Marketing Co v Kara [1963] 1 WLR 523 at 524; [1963] 2 All ER 553 at 555 (PC) cited by McHugh JA in Holcombe v Coulton (1988) 17 NSWLR 71 at 78. 99 Coopers Brewery Ltd v Panfida Foods Ltd (1992) 26 NSWLR 738 at 746. 100 Multicon Engineering Pty Ltd v Federal Airports Corporation (1997) 47 NSWLR 631 at 645-646; cf Dovuro (2000) 105 FCR 476 at 487-488 [38]. 101 Queensland v J L Holdings Pty Ltd (1997) 189 CLR 146 at 172. 102 Although it did so in Coulton v Holcombe (1986) 162 CLR 1 on the basis that the determination of the point would involve virtually a new trial of an issue different from that earlier litigated. 103 (2000) 105 FCR 476 at 487 [38], 498-499 [85]-[86], 508 [118]. 104 (2000) 105 FCR 476 at 498 [85]. Kirby that, because of the denial that a duty of care was owed, set out in the pleadings, all relevant evidence for the Wilkins on this issue must have been adduced by the time the concession was announced; that the question of the existence of a duty involved the application by the judge to the facts of the applicable principles of law and little time was lost or saved by the course taken at trial; that no hidden tactical or forensic motive for the course adopted by Dovuro at trial was proved or suggested; and that substantial issues of liability for economic loss to an allegedly indeterminate class and foreseeability of damage to that class arose on the evidence and warranted elucidation according to law for this and future cases. As against these considerations several others supported the conclusion that Dovuro should be held to the concession that its lawyers made at trial on its behalf. The concession was a deliberate act, inferentially made on express instructions. It was supported by the explicit statements of officers of Dovuro received in evidence acknowledging the duty. Once made, it meant that the primary judge did not, as he otherwise would have done, analyse the issues and make findings of fact relevant to the duty issue upon the mass of evidence adduced before him. The case was, as Branson J pointed out, typical of the large and complex actions now being brought to Australian courts, including appellate courts, where a well-resourced litigant should not, on appeal, have the opportunity to "re-run its case … adopting a changed strategy"105. No error is shown: The responses of judges to applications such as that made by Dovuro in the Full Court tend to vary in accordance with their evaluation of the particular case and of the reasons propounded for withdrawing the concession, and the significance and utility they see in the proposed point, if it were allowed. If I had been participating in the Full Court, I might well have agreed on this issue with Gyles J. However, this Court must approach this issue mindful of its own limited role106. Neither in the consideration of the applicable principles nor in the identification of the parties' arguments did the majority in the Full Court err. Nor is its decision so clearly erroneous as to indicate error. It 105 (2000) 105 FCR 476 at 487 [38]. 106 cf Liftronic Pty Ltd v Unver (2001) 75 ALJR 867 at 879-880 [65]; 179 ALR 321 at 336-338; Fox v Percy (2003) 77 ALJR 989 at 993-995 [20]-[31]; 197 ALR 201 at Kirby follows that, in my view, the concession at trial should stand in the terms in which it was given. So far as I am concerned the issue is not whether, in this Court, Dovuro should be permitted to resile from its concession at trial107. It is whether error has been shown on the part of the Full Court authorising this Court to substitute a different conclusion. I can reach my conclusion more comfortably because I agree with the joint reasons in this Court that my conclusion on this point does not deprive Dovuro of its main argument108. The issue of the reasonable foreseeability of the harm that occurred to the Wilkins remains open on the question of the alleged breach of duty. The contention of Dovuro that it could not owe a duty of care to avoid economic loss to the Wilkins on the basis that this would expose it to liability to an indeterminate class is unpersuasive109. As in Perre v Apand Pty Ltd110, the class involved was not open-ended or indeterminate. It was readily identified as the growers whom Dovuro intended to receive, and who did receive, the bagged Karoo seed containing the weeds of which it was aware. Dovuro therefore fails on the first issue. Existence of a duty of care was established The foregoing conclusion establishes, by Dovuro's concession, that it owed the Wilkins a duty of care. Trial counsel for Dovuro should not be criticised for making that concession. Whilst I accept that this Court has not yet provided a clear and simple formula to be applied to ascertain the existence, or absence, of a duty of care111 (nor even a simple methodology that commands general assent112) I agree with Branson J in the Full Court113 that it would be 107 Reasons of Gleeson CJ at [3]; cf reasons of McHugh J at [29]. 108 Joint reasons at [154]. 109 cf (2000) 105 FCR 476 at 531 [193]. 110 (1999) 198 CLR 180 at 289-291 [298]-[302]. 111 Such as the tests of "proximity" and "reliance" formerly propounded: San Sebastian Pty Ltd v The Minister (1986) 162 CLR 340; Gala v Preston (1991) 172 CLR 243; Bryan v Maloney (1995) 182 CLR 609. 112 Such as the three-fold test in Caparo Industries Plc v Dickman [1990] 2 AC 605 at 617-618 per Lord Bridge of Harwich: see eg Perre v Apand Pty Ltd (1999) 198 CLR 180 at 281-286 [274]-[288]. See now Sullivan v Moody (2001) 207 CLR 562 at 579 [49] and Graham Barclay Oysters Pty Ltd v Ryan (2002) 77 ALJR 183 at 226-227 [229], 227-229 [234]-[238]; 194 ALR 337 at 397-400. 113 (2000) 105 FCR 476 at 485 [26]. Kirby difficult to reconcile a contrary conclusion about the existence of a duty of care in this case with this Court's holding in Perre v Apand Pty Ltd. In Romeo v Conservation Commission (NT)114, I drew attention to the need to approach disputes in negligence cases by considering, in turn, a number of standard questions. These included whether a duty of care was established; if so, "the measure or scope of that duty in the circumstances"; and whether it was proved that the defendant was in breach of the duty so defined. Inevitably, the questions, dissected in this way, merge into one another. The analytical divisions and subordinate questions are all designed to bring the mind of the decision-maker to the ultimate issue presented by the many cases that have followed Donoghue v Stevenson115. They address attention to whether, in all the circumstances of the case, it is reasonable to impose a legal duty of care of the postulated character upon the alleged tortfeasor116. In the search for consistent decision-making, lawyers endeavour to segregate the concepts of duty, scope and breach. Yet in truth they represent, ultimately, component parts of a unified notion that must be constantly brought back to the touchstone of reasonableness117. The concession of the existence of a duty of care in the present case was made without much clarity as to the scope of the duty being conceded. Obviously, the scope of the duty has significance for the related question of breach to which I now turn. Breach of duty was correctly found Applicable legal principles: A majority of this Court has concluded that the Wilkins' claim against Dovuro fails on the issue of breach118. I disagree. The majority decide that the events that unfolded as a consequence of Dovuro's importation of the Karoo canola seed containing weed seed, were not reasonably 114 (1998) 192 CLR 431 at 475-476 [115]. 116 Graham Barclay Oysters Pty Ltd v Ryan (2002) 77 ALJR 183 at 230 [244]; 194 ALR 337 at 402 citing Tame v New South Wales (2002) 76 ALJR 1348 at 1380 [185]; 191 ALR 449 at 493. See also Avenhouse v Hornsby Shire Council (1998) 44 NSWLR 1 at 8; Perre v Apand Pty Ltd (1999) 198 CLR 180 at 253 [198] per 117 Tame (2002) 76 ALJR 1348 at 1382 [195], 1409 [331]; 191 ALR 449 at 496, 533- 118 Reasons of McHugh J at [39]; reasons of Gummow J at [62]; joint reasons at [174]. Kirby foreseeable. Specifically, it was not foreseeable that the agricultural authorities of Western Australia would declare the three weed varieties to be prohibited plants, thereby imposing burdens on the Wilkins and growers in a like position to eradicate the weeds from the canola crop; to isolate the areas where the seed had been sown; and to limit resowing of the land and access of animals to it with consequent cost and loss to the growers concerned. Two basic points differentiate the approach that I would take from that favoured by the majority. First, it follows from what I have already said that it is impossible to decide negligence questions without having substantial familiarity with the trial evidence, and all of it. In the present appeal this means familiarity with the six volumes of appeal papers presented to this Court. Conclusions about the reasonableness or otherwise of imposing a duty of care of a given scope on Dovuro and whether Dovuro was in breach of the duty so specified, are not safely made without a thorough understanding of those facts. A primary judge, sitting through and receiving all of the evidence, is obliged to consider that material in sequence as it is adduced. In the nature of later consideration of such evidence (but especially in this Court) appellate judges are taken in argument to selected passages only. Normally, those extracts constitute the passages deemed specially favourable to the parties who call them to notice. Of nearly 1400 pages of the record of the proceedings, this Court was taken during oral argument to but 21. The burdens on appellate judges are such as to limit their ability to absorb, and reflect upon, all of the remaining pages119. In the nature of things, the reasons of primary judges can only explain some of the main considerations that have led them to their judgment120. It follows that appellate judges cannot easily substitute for primary judges, at least in trials with long and complex evidence. I have always thought that it was in this respect that primary judges enjoy advantages over appellate judges in decisions on the facts rather than in the oft repeated references to the assessment of witness credibility121. The second reason that informs my different conclusion concerns a point of law. As I read the majority reasons in this Court, they appear to suggest that it was necessary, if the Wilkins were to succeed, for them to demonstrate that it 119 State Rail (1999) 73 ALJR 306 at 330-331 [89]-[92]; 160 ALR 588 at 619-620. 120 Biogen Inc v Medeva Plc [1997] RPC 1 at 45 per Lord Hoffmann; Aktiebolaget Hässle (2002) 77 ALJR 398 at 416 [90], 417 [97]; 194 ALR 485 at 509, 510. 121 Fox v Percy (2003) 77 ALJR 989 at 993-994 [23], 995 [30]-[31]; 197 ALR 201 at 207, 209-210; cf Lend Lease Development Pty Ltd v Zemlicka (1985) 3 NSWLR Kirby was reasonably foreseeable that the particular circumstances that caused their losses would probably occur. Thus, much is made of the difficulty that the Wilkins were said to face of establishing (against a background in which the three weed varieties were not prohibited plants in Western Australia) that the State authorities would probably react as they did. It was suggested that the reaction of the State authorities was not reasonably foreseeable because of the unpredictability of the pressures (scientific, financial and political) imposed on them, the response of government and officials to such pressures, the inability of outsiders to know what the response would be and the unlikelihood that the authorities would have anticipated their reaction if earlier consulted about the presence of the weeds122. The undemanding test: Perhaps the law on this subject should be as these questions suggest. It has sometimes been argued that the decision of the Privy Council in The Wagon Mound [No 2]123 resulted in a wrong turning of the law of negligence. Instead of asking what was "liable to happen" in the sense of "not unlikely to happen" (as some judges suggested124), their Lordships in Wagon Mound embraced what has been described as the "undemanding" test of reasonable foreseeability125. By that test, it is sufficient that a reasonable person in the defendant's position would have foreseen that its conduct involved a risk of injury to the plaintiff or to a class of persons including the plaintiff126. It remains, if this question is answered in the affirmative, to decide what a reasonable person would then have done by way of response to such risk. However, the risk is posed at a general level of possibility and in terms of risk of harm. It is not posed in terms of the likelihood of the particular harm that allegedly occurred. There is a reason for this. The duty which the law of negligence invokes is concerned with securing a response to a risk of harm generally. It does not demand exact prescience, so that the putative tortfeasor will be expected to see into the future and predict the specific way in which events will work out. In Wyong Shire Council v Shirt127, this Court acknowledged the strong arguments that existed for "a narrower version of the foreseeability doctrine as 122 cf joint reasons at [170]-[171]. 123 Overseas Tankship (UK) Ltd v The Miller Steamship Co Pty [1967] 1 AC 617. 124 Caterson v Commissioner of Railways (1973) 128 CLR 99 at 101-102 per 125 Shirt v Wyong Shire Council [1978] 1 NSWLR 631 at 641-642 per Glass JA. 126 Wyong Shire Council v Shirt (1980) 146 CLR 40. 127 (1980) 146 CLR 40. Kirby applied to breach of duty"128. However, by majority, it there accepted as part of Australian law the unanimous approach of the Privy Council in Wagon Mound. That approach has been applied ever since in countless cases everywhere in this country. If it is to be changed, such change should occur either by legislation or following a fully considered attack on the binding rule in Shirt mounted before the Full Court of all Justices of this Court. Whilst the rule in Shirt stands, this Court should apply it. In the instant case, the undemanding test of foreseeability did not require of Dovuro super-human capacities to predict the exact course of events leading to the precise damage that the Wilkins suffered. It was enough that it was reasonably foreseeable that Dovuro's introduction of the three weed seeds into Western Australia involved a risk of harm to the Wilkins that was possible, that is, neither far-fetched nor fanciful129. If this "undemanding" test was satisfied, the question was then posed as to whether Dovuro, acting reasonably, would have taken either or both of the precautions postulated by the Wilkins. I remind myself that these were to (1) check with the Western Australian agricultural authorities in advance about any possible problems or sensitivities of introducing weed varieties common in New Zealand but which might not be common in Western Australia; and (2) inform the purchasers of the Karoo seed of the possible presence of the weed seeds so that they could take their own precautions and make their own judgments. Dovuro took neither of these steps. Its omissions were rightly and publicly regretted by its management and associates. Together with the other evidence, the statements help sustain the primary judge's conclusion that breach on the part of Dovuro of the conceded duty of care to the Wilkins had been established. No error has been shown to warrant this Court's substituting a different view of the facts for that reached by the primary judge who applied the correct legal principles. In particular, no such error is shown as would warrant this Court, with its more limited familiarity with all the facts, substituting a different factual conclusion for that reached by the primary judge with the advantages that he enjoyed in this particular case. Relevant factual findings: The majority refer to omissions in the evidence called by the Wilkins to establish Dovuro's negligence. In particular, they place emphasis upon the passage in the reasons of Gyles J in the Full Court commenting upon gaps that his Honour perceived in the evidence that could have been called at trial130. This Court's role is not to provide an ex post advice on 128 (1980) 146 CLR 40 at 47. 129 Wyong Shire Council v Shirt (1980) 146 CLR 40 at 47-48. 130 Reasons of McHugh J at [32]; reasons of Gummow J at [65]. Kirby evidence about the manner in which a party could have proved its case at trial. Armed with wisdom after events, magnified by the perspective of a third-level hearing, we can always think of something better. But the true issue is whether error has been shown in the way the matter was resolved by the Full Court. In that Court, notwithstanding the defects he described in the evidence, Gyles J, correctly in my view, accepted that there was sufficient evidence to sustain the primary judge's conclusion on breach. Rightly in this case, he deferred to that conclusion. To the other evidence to which Gyles J referred, must be added the additional evidence mentioned by Gleeson CJ in his reasons131. And in addition to that evidence, there was much other material to sustain the concurrent findings of negligence made in this case. This Court has said many times that it will rarely disturb such concurrent findings. Yet that is what the majority do in this case upon grounds that appear, with respect, to be less than compelling. To appreciate the primary judge's decision, it is necessary to read his Honour's reasons as a whole. It is also necessary to consider again much of the evidence and the many documents received in the trial. Amongst relevant findings made, and evidence referred to, are the following. Canola, grown in Australia, competes on a world market for use in the manufacture of margarine, edible oils and livestock fodder. Until now, canola grown in countries other than Australia has been plagued with weed problems. Canola grown in Western Australia has enjoyed a particular market advantage, specifically in Japan, because it has been known to be weed-free132. The presence of more than a tiny proportion of weed seeds in the subject canola seed would have made it unsuitable for the growers, like the Wilkins, to whom it was supplied133. Mr Rudolf Kudnig, Dovuro's technical manager, who instigated the growing of the seed in New Zealand, knew of the presence of noxious weeds in the seed134. It was open to inference that Mr Kudnig would have been aware that, because of climatic and other differentials, particular weeds that are tolerated in one place (such as New Zealand) might present special problems in another place that has previously been free of such weeds (such as Western Australia). Mr William Tapp, general manager of Dovuro, was informed of the presence of the three weeds, found in a germination test conducted for Dovuro by 131 Reasons of Gleeson CJ at [23] referring to (1999) 169 ALR 276 at 290 [50]-[51]. 132 (1999) 169 ALR 276 at 278 [9]. 133 (1999) 169 ALR 276 at 278-279 [10]-[11]. 134 (1999) 169 ALR 276 at 280-281 [19]-[20]. Kirby Cropmark. He acknowledged that their presence "was of concern"135. Yet he allowed his concern to be allayed by the fact that the New Zealand Ministry of Agriculture and Fisheries had given a certificate for the seed and that the three weed varieties notified were not then prohibited (relevantly) in Western Australia. Mr Tapp accepted it would not have been difficult for him to contact the Western Australian authorities to ask them if the particular weed seeds could be a problem. He could have done so by telephone at any time and at trivial cost136. Although it is suggested in other reasons that the officials might not have been willing to foreshadow their reaction, we will never know what they would have done. They were never asked. Put simply, Mr Tapp did not pursue the matter. In effect, he equated the discharge of Dovuro's obligations to conforming to the regulatory regime then in force. This was so, although he had particular knowledge about the presence of the three identified weeds and viewed them as being "of concern". In other areas of the law of negligence this Court has emphatically rejected this form of conclusive reliance on the standards of the profession or trade in question137. There is no good reason in this field to go back to that erroneous doctrine. On the contrary, sound policy upholds a vigilant obligation of care on the part of seed importers into Australia. Our international trade and foreign earnings continue to depend heavily upon such rural enterprises. This is not a time to send a signal that grain importers like Dovuro can act imprudently and shed crocodile tears afterwards, escaping liability for negligence which greater care on its part would have avoided. On the basis of the evidence, the primary judge concluded that "[h]ad officers of AgWest's seed section been alerted to the presence of [cleavers] species seeds, they would almost certainly have taken steps to prevent release of the canola to farmers, at least pending further investigation"138. That conclusion rested on correspondence within AgWest, produced at trial, relating to the seriousness with which cleavers was regarded in Western Australia. In my view, it is a finding that is impregnable from appellate correction and factually correct. Not long after the Wilkins received the bagged seed, which was labelled "minimum 99% purity", they sowed it over 278 hectares. Immediately afterwards there was a report in a rural newspaper of an alert to AgWest because of the discovery by another farmer of "foreign" seeds in newly purchased Karoo canola seed139. It was this report, and the controversy that it occasioned, that led 135 (1999) 169 ALR 276 at 282 [26]. 136 (1999) 169 ALR 276 at 282-283 [27]. 137 Rogers v Whitaker (1992) 175 CLR 479 at 489. 138 (1999) 169 ALR 276 at 283-284 [30]. 139 (1999) 169 ALR 276 at 284 [34]. Kirby Mr Tapp to issue a media release headed "Weed Seeds in Karoo". As the statements made in this release are set out in the reasons of Gleeson CJ140, I will not repeat them. But they represent telling evidence of public acknowledgment by the body with superior access to expert global awareness of weed problems (Dovuro) that it could have done more if it had not been pursuing its own immediate profits so urgently. Soon after this statement, Mr Keith White, a person described as having "a major indirect interest in Dovuro" who worked closely with Mr Tapp141, wrote a letter, distributed to a number of recipients, with copy to Mr Tapp, saying142: "[W]e recognise that the seed should not have been released and that field production may cause a problem for some canola growers. It is easy to make excuses but the short time-frame for the importation … in association with the strong demand (perhaps euphoria) from dealers and growers for the seed, may have resulted in inadequate quality control checks. Perhaps we almost tried too hard. … [W]e are confident that future canola planting seed will have all necessary control checks to ensure that only high quality seed is released. We also have abandoned any thoughts of future seed production in New Zealand or Tasmania over Summer due to difficulty of adequate control procedures." Mr Tapp never disassociated himself, or Dovuro, from Mr White's sentiments. Once they became aware of the presence of the three weed seeds, both relevant authorities in Western Australia sprang into action. AgWest secured the agreement of the Minister to declare the three weeds under the Plant Diseases Act 1914 (WA) within category P1 (Prevention: plants which cannot be introduced or spread)143. Urgent steps were taken to advise growers on the procedures that they should follow to ensure against spread of the weed. The particular seriousness of introduction of cleavers was noted by AgWest because that weed had afflicted canola crops in Canada144. The climate of south-western Australia (where the Wilkins farm was located) was described as "well suited to this weed". Mr Eamonn Rath (Dovuro's then Western Australian field officer) sent letters of apology to Western Australian growers. This statement too is set 140 Reasons of Gleeson CJ at [19]. 141 (1999) 169 ALR 276 at 280 [18]. 142 (1999) 169 ALR 276 at 287 [39]. 143 (1999) 169 ALR 276 at 287 [40]. 144 (1999) 169 ALR 276 at 289 [45]. Kirby out in the reasons of Gleeson CJ so I will not repeat it145. But to the passage quoted in those reasons may be added the concluding words, by way of reiteration146: "Dovuro would like again to apologise unreservedly to all growers who purchased New Zealand Karoo seed. Dovuro did not break any regulation, and all its actions were legal at the time." Copies of such letters were sent to Mr Tapp. He took no action to disclaim their contents. The various apologies, statements of regret and promises of improvement do not, as such, establish the claim of negligence against Dovuro. They were not "extorted" from that company by the Wilkins or other growers147. They were made defensively, ostensibly to show regret and out of self-interest. However, they are indisputably evidence relevant to the conclusion that the primary judge was called upon to make in harmony with all of the other testimony in the trial. They lent support to the Wilkins' allegation of breach of the duty of care. That was the way in which the primary judge treated them. He was correct to do so. The primary judge also heard evidence from an expert in agricultural science, Dr Terence Piper, acting manager of the Weed Science Group. He described how, previously, cleavers had not been reported as a problem weed in Western Australia. Whilst all weeds were undesirable, some, he said, were "more undesirable than others". The three weeds introduced with the Karoo canola seed supplied to the Wilkins by Dovuro were described by Dr Piper as falling within the "most undesirable" status. They had "no redeeming features"148. It was clearly open to the primary judge to accept this testimony, as he did. On the basis of the foregoing evidence, the primary judge found that, prior to the Dovuro importation in 1996, the three weeds were not present in Western Australia, except in a few isolated places, and that there was good reason for regarding the introduction of the weeds into the wheat belt region of the State as most undesirable. They were especially undesirable as they might affect canola 145 Reasons of Gleeson CJ at [20]. 146 (1999) 169 ALR 276 at 289-290 [48]. 147 Reasons of Gummow J at [70] referring to Grey v Australian Motorists & General Insurance Co Pty Ltd [1976] 1 NSWLR 669 at 676 per Glass JA. 148 (1999) 169 ALR 276 at 292 [57]. Kirby crops grown in the Western Australian broad acre farming industry149. After examination of the foregoing and much more evidence, the primary judge rejected the contention that AgWest had over-reacted to the discovery of the presence of the weed seeds150. Having regard to the reasons given, his conclusion on that issue is likewise immune from appellate disturbance. Similarly, on the basis of much evidence, the primary judge concluded that the bag labelling of the Karoo seed, adopted by Dovuro, was not sufficient to satisfy that company's obligation towards the growers intended to buy and use the seed151. Had the growers at least been notified of what Dovuro knew from Cropmark in New Zealand about the presence of weeds "of concern", the judge concluded "[they] might have [taken] precautionary action, either of their own initiative or at the behest of a governmental authority"152. In the past, in other areas of the law of negligence, this Court has insisted upon duties of notification to those affected of known risks to which they are exposed by the actions of others with superior knowledge153. The greater the risk, the higher the duty to notify. Involved in this principle is a respect for the autonomy of individuals to make informed decisions concerning their own interests when placed in a position of risk by the acts or omissions of others. Where there is potentially a high risk, as in the supply of imported seed into a vulnerable domestic farming area, the importer with technical and scientific expertise available to it, will be held to a high standard of care for, and of notification to, the growers who were necessarily reliant on being alerted to any unusual risks to which they are exposed. It is against this background that the primary judge accepted that the Wilkins had proved that Dovuro had breached its duty of care to them and to other growers like them. There were the evidentiary admissions, apologies and acknowledgments. There was the failure, in advance, even to check with the Western Australian authorities whether the three known weed varieties might also have been "of concern" to those authorities. There was the misleading and inadequate labelling of the bags. In these premises, the primary judge did not err in concluding that it was reasonably foreseeable that the State authorities would 149 (1999) 169 ALR 276 at 292-293 [60]. 150 (1999) 169 ALR 276 at 297 [71]-[73]. 151 (1999) 169 ALR 276 at 311 [108]. 152 (1999) 169 ALR 276 at 302 [89]. 153 Rogers v Whitaker (1992) 175 CLR 479; Chappel v Hart (1998) 195 CLR 232; Rosenberg v Percival (2001) 205 CLR 434. Kirby take some action to defend the particularly valuable broad acre farming industry in Western Australia in which the Wilkins participated. There was thus no error on the part of the Full Court which this Court would be authorised and warranted to correct. I would prefer to state my conclusion in this way rather than by reference to criteria such as "clear error or injustice"154. Only when the peculiarities of the seed industry, specifically of canola exports and Western Australian conditions, are taken into account is the primary judge's conclusion of breach of duty fully appreciated. Then it is compelling. No error is shown: This Court can safely leave the diminution of the ambit of the law of negligence, where that is desired, to the legislature which has not been backward in recent years in acting to that end. As a court of law, this Court should adhere to common law principle155. Above all, we should be cautious in assuming the function of a jury, redetermining factual conclusions in a complex case with a lot of evidence, where it is difficult, or impossible, to recapture all of the advantages of the trial. Dovuro supplied the growers with a seed with three known weeds "of concern", two of which were of "serious concern" and one of which (cleavers) was treated as a menace in Canada. Little wonder in such circumstances that Dovuro and its associates apologised to the growers. Little wonder that the primary judge found, by the undemanding test, that the harm done to the growers was reasonably foreseeable and that elementary precautions that could, and should, have been taken were not. The growers were completely innocent. Dovuro, as it admitted, was far from faultless. The consequences of the ensuing loss are, by the law of negligence, to be borne by Dovuro. The Federal Court was right to so conclude. It is wrong, both as a matter of law and of fact, for this Court now to intervene to substitute its own contrary factual conclusion. The declaration involved no error In response to the suggestion that the primary judge also erred in entering an interlocutory judgment in favour of the Wilkins in the form of declarations relating to the matters of liability determined by him, I can only repeat what I said on this subject in Graham Barclay Oysters Pty Ltd v Ryan156. In this case, the primary judge was engaged in the determination of proceedings brought under Pt IVA of the Federal Court of Australia Act 1976 154 cf reasons of Gleeson CJ at [26]. 155 Cattanach v Melchior (2003) 199 ALR 131 at 167-168 [137]. 156 (2002) 77 ALJR 183 at 234 [263]-[268]; 194 ALR 337 at 406-408. Kirby (Cth). The Wilkins initiated proceedings on their own behalf and as representatives of persons in a class defined to include identified and yet to be identified canola growers who purchased the seed Karoo in 1996, including the weed seeds, planted the same and suffered loss157. The primary judge published his reasons on the issue of liability, which had been severed from the other issues in the trial. He ordered the continuation of the trial for the calculation of the damages payable to the Wilkins and the persons whom they represented158. It was to facilitate an interlocutory appeal, which Dovuro wished to bring, that the primary judge took the course that he did. The declaration relating to damage was deemed necessary to meet a possible objection that an essential element of the tort of negligence had not been found to have been established. The primary judge simply recorded a declaration that the applicants had suffered some damage in consequence of the breach159. The amount of that damage was still to be quantified. Obviously, assessing the damages suffered by the Wilkins and their class would be a large enterprise, given all that the Wilkins were obliged to do by the agricultural authorities in Western Australia to eradicate the offending weeds. In the elucidation of legal rights, there is no point in this Court's repeatedly instructing others about the primacy of statutes160 if it fails to observe the same rule for itself. It is beside the point that interlocutory declarations are a form of order not known to the law on procedural orders161 when, in the particular case of the Federal Court, in proceedings such as these, provision is expressly made for such declarations by that Court's enabling statute. Representative proceedings are not traditional litigation162. In disposing of a matter in a representative proceeding, by determining any issue of law or fact and making "a declaration of liability" in the course of such determination, a court is moulding its orders to the special needs of such proceedings as the Parliament 157 (1999) 169 ALR 276 at 277 [2] where the class is defined. 158 (1999) 169 ALR 276 at 322-323 where the orders are set out. 159 (1999) 169 ALR 276 at 290 [49]. 160 eg Roy Morgan Research Centre Pty Ltd v Commissioner of State Revenue (Vict) (2001) 207 CLR 72 at 89 [46]; The Commonwealth v Yarmirr (2001) 208 CLR 1 at 111-112 [249]; cf Hayne, "Letting Justice Be Done Without the Heavens Falling", (2001) 27 Monash University Law Review 12 at 16. 161 cf joint reasons at [143]. 162 Wong v Silkfield Pty Ltd (1999) 199 CLR 255. Kirby envisaged and provided163. It is no part of the function of this Court to narrow the powers given to the Federal Court by the Parliament in the widest terms, to determine such proceedings as their particular circumstances require or suggest. representative proceedings, where The grant of power by statute to superior courts is always broadly construed164. Why, therefore, would we take a narrow view of a clear mandate in flexibility and legislation governing inventiveness are at a premium165? I dissent from the attempt to wind back the clock of procedural flexibility and to restrict the statutory power to make "a declaration of liability", clearly intended to include an interlocutory declaration, where that course would needlessly impede the attainment of the legislative objects of economy to the parties and the community as well as procedural fairness. Understandably, Dovuro, which benefited by the interlocutory order that the primary judge made, raised no objection on this score. Nor did the Wilkins. The last thing Dovuro wanted at trial was to be forced to complete the ascertainment of the damages suffered by the Wilkins and those in the class whom they represented, before it mounted this appeal. Indeed, it is ironic that the wisdom of what the primary judge did is now vindicated by the very orders of the majority who express the criticism of the declarations that he made. The costs order should stand Dovuro challenged the costs orders made by the Full Court in the second proceeding heard by that Court in 2001166. In light of the conclusion that I have reached on the substantive issues in this appeal, there is no foundation for the disturbance of the costs orders made. Orders The appeal should be dismissed with costs. 163 Federal Court of Australia Act 1976 (Cth), s 33Z(1). 164 Knight v FP Special Assets Ltd (1992) 174 CLR 178 at 205; Gerlach v Clifton Bricks Pty Ltd (2002) 209 CLR 478 at 505-506 [75]-[76]. 165 cf Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 367-371 [80]-[89]; cf at 355-357 [45]-[49]. 166 Dovuro Pty Ltd v Wilkins (No 2) (2001) 107 FCR 104 at 110 [25], order 4. 132 HAYNE AND CALLINAN JJ. The appellant ("Dovuro") lawfully imported into Australia, and lawfully sold to distributors in Western Australia, canola seed in which very small quantities of the seeds of three other plants had been found. The canola seed was sold in bags labelled "Minimum 99% Purity". The other plants, if they grew in a canola crop, would be regarded as weeds. After Dovuro had imported the seed, distributors had sold it, and farmers had planted it, government authorities in Western Australia decided that farmers who had sown the canola seed should be advised to take steps to prevent the growth of the other plants. If they did grow they had to be eradicated. Despite many farmers sowing the seed which Dovuro had imported, no farmer reported the growth of these other plants. Farmers in Western Australia who had sown the seed which Dovuro had imported claimed damages alleging, among other things, that Dovuro had been negligent in failing to warn them that the 1 per cent or less foreign matter in the seed may include seeds of the three other plants. The farmers alleged that they had incurred costs and expenses complying with the recommendations which had been made. Two questions were argued in this Court. Did Dovuro owe the farmers a duty of care? If so, did Dovuro breach that duty? At trial, Dovuro conceded that the first question should be answered, yes. It will be necessary to consider the content and effect of that concession but, in this Court, it is the second question which is determinative. It should be answered, no. The facts Dovuro carried on business as a distributor of oilseed. It organised the production of commercial quantities of seed and sold the seed to distributors. In 1995, Dovuro made arrangements with a New Zealand company which has since been liquidated and dissolved (Crop Marketing New Zealand Society Ltd – "Cropmark") for Cropmark to grow a strain of canola seed which would tolerate high rates of application of triazine herbicides. This strain of canola was called "Karoo". Dovuro imported quantities of the Karoo seed produced by Cropmark into Australia. Some was sold to seed merchants in Western Australia who, in turn, sold it to Western Australian farmers, including the first respondents ("the Wilkins"). The New Zealand Ministry of Agriculture and Fisheries ("MAF") tested the seed before Dovuro sold it in Australia. The MAF found what its seed analysis certificates described as "[t]race" quantities of "weed seed". In particular, in some of the lines of seed that were tested, some seeds of cleavers (Galium aparine), redshank (Polygonum persicaria) and field madder (Sherardia arvensis) were found. The certificates said (and it was the fact) that the canola seed, even with these traces of "weed seed", complied with Quarantine Proclamations that had been made "under the Commonwealth of Australia Quarantine Act [the Quarantine Act 1908 (Cth)] [and] ... the Seeds Acts of all Australian States". Importation of the seed into Australia was authorised by the Australian Quarantine and Inspection Service; its importation into Western Australia was authorised by the Western Australian Quarantine and Inspection Service. In April and May 1996, the Wilkins bought and planted one tonne of this Karoo seed. In June 1996, officers of AgWest (as the Agriculture Department of Western Australia was known) became concerned about the presence of the cleavers, redshank and field madder seeds in the Karoo seed which Dovuro had distributed. On 5 July 1996, two declarations were made by the Agriculture Protection Board, under the Agriculture and Related Resources Protection Act 1976 (WA) ("the Protection Act"), declaring, in the one case, redshank and field madder, and in the other, cleavers, to be declared plants and assigning each to "categories P1 and P2 for the whole [S]tate". The effect of these declarations was to prohibit the introduction into, or movement within, the State of the plants identified167 and to require their eradication168. A few days later, AgWest sent canola growers some advice about what they should do if they had sown Karoo seed, including recommendations that they inspect their crops and "[k]eep a constant look out for these weeds over the next 10 years". They were told what to do if they found any of the three plants and to take certain precautions to avoid spreading the seeds of the plants concerned. By May 1998 (nearly two years after their original declaration as declared plants under the Protection Act), the declarations of redshank and field madder had been cancelled. Cleavers remained a declared plant. In fact, despite many farmers buying Karoo canola seed from lines in which the seeds of these three plants had been detected in the MAF seed analyses, no farmer reported finding any of the plants growing. Why that is so has not been established. It may have been because the precautionary measures recommended by AgWest had the desired effect and prevented the other plants growing; it may have been because the seeds of the other plants did not germinate; it may have been because the growing canola smothered the other plants. Perhaps it was some combination of these reasons. The proceedings below The Wilkins brought action in the Federal Court against Dovuro claiming damages and alleging negligence and contravention of s 52 of the Trade 167 s 36(3)(a). 168 s 36(3)(b). Practices Act 1974 (Cth). They brought the action as a representative claim under Pt IVA of the Federal Court of Australia Act 1976 (Cth) on behalf of a class identified essentially as those canola growers who, in 1996, bought and planted Karoo canola seed which had been supplied by Dovuro to distributors in Western Australia. Dovuro made a cross-claim against Cropmark. The Wilkins then amended their claim to join Cropmark as a respondent and to make claims against Cropmark similar to those they had made against Dovuro. The primary judge (Wilcox J) directed that "the matter proceed on the basis of an initial hearing on liability, the question of damages being postponed to a later date". Presumably this was a direction under O 29 of the Federal Court Rules for the decision of the question of liability separately from other questions in the case. The primary judge held169 that Dovuro had been negligent but had not contravened s 52 of the Trade Practices Act. He dismissed the claims against Cropmark. The difficulties of separating questions of liability for negligence from questions of damages are evident. Damage is an essential element of the tort of negligence. Proof of damage is essential to establishing liability. Further, assessing the standard of care to be met, by reference to the degree of probability of damage occurring, and the expense, difficulty and inconvenience of taking alleviating action170, will often be assisted by knowing what happened as a result of the alleged negligence. In a case like the present, where the negligence is said to have had financial consequences, knowing the extent of those consequences may be particularly important. Splitting trial of the issues of liability and damage may, therefore, achieve little real saving in time or expense. More significantly, by truncating or abbreviating the evidence led about, and attention given to, questions of damage at the trial of questions of liability, separation of the trial of the issues may distort the determination of questions of liability. Apart altogether from these difficulties, there is a further and different kind of difficulty presented by taking the course which was taken in this case. If the primary judge concludes, as he did in the case against Dovuro, that negligence has been established, no final judgment can be entered. In this case, while an appeal to the Full Court of the Federal Court was pending, the primary judge made orders in the form of declarations – declaring that Dovuro "owed a 169 Wilkins v Dovuro Pty Ltd (1999) 169 ALR 276. 170 Wyong Shire Council v Shirt (1980) 146 CLR 40 at 47-48 per Mason J. See also Perre v Apand Pty Ltd (1999) 198 CLR 180 at 332 [435]-[436] per Callinan J. duty of care to the [Wilkins] and group members and that it was in breach of such a duty" and that "some damage was suffered by the [Wilkins] as a result of such a breach of duty". It seems to have been thought that the making of such orders would facilitate an appeal against the primary judge's findings. Be this as it may, orders of that kind should not be made171. Interlocutory declaration is a form of order not known to the law. the question of If, as may have been the intention, all questions of liability were to be regarded as concluded as between the Wilkins and Dovuro, it may have been open to the primary judge to direct entry of judgment for the Wilkins in their proceeding against Dovuro, for damages to be assessed. But what is not clear from the orders that were made is what, if any, questions were concluded as between Dovuro and those whom the Wilkins represented. On no view of the orders was there was no determination that any of the represented parties had suffered damage as a result of Dovuro's breach of its duty of care. (Unlike the first declaration, which dealt with Dovuro's duty of care not only to the Wilkins but also to group members, the second declaration said only that "some damage was suffered by the [Wilkins] as a result of such a breach of duty". This second declaration reflected the primary judge's finding172 that the Wilkins had suffered some damage as a result of Dovuro's breach of duty. There was no finding that any group member had suffered damage.) liability finally determined; Dovuro appealed to the Full Court of the Federal Court. That Court, by majority (Branson and Gyles JJ, Finkelstein J dissenting), dismissed Dovuro's appeal173. The course of proceedings at trial In order to understand the issues which were argued in the Full Court and on appeal to this Court, it is necessary to say something more about the course of proceedings at trial. The case against Dovuro was put by the Wilkins in the final form of their statement of claim as having three important steps: 171 Graham Barclay Oysters Pty Ltd v Ryan (2002) 77 ALJR 183 at 208 [128] per Gummow and Hayne JJ; 194 ALR 337 at 370-371. 172 (1999) 169 ALR 276 at 290 [49], 311 [109]. 173 Dovuro Pty Ltd v Wilkins (2000) 105 FCR 476. (a) Dovuro knew or ought to have known that the canola seed Dovuro distributed contained, or may contain, "undesirable weed seeds including cleavers, redshank and field madder"; (b) Dovuro owed the Wilkins, and those whom they represented, "a duty ... to exercise reasonable care to avoid injury to them"; (c) Dovuro was negligent in that: (i) it failed to advise of the presence of the "weed seed"; (ii) it failed to place any warning on the bags of canola seed that the seed may contain the "weed seed"; and (iii) it failed "to generally advise the [c]anola seed growing industry" of the presence or possible presence of the weed seed. Dovuro denied each of these allegations. After the parties had closed their respective cases at trial, each filed written submissions. In their written submissions, the Wilkins contended that Dovuro "had a duty to the consumers of the seed to exercise reasonable care not to expose the consumers to a risk of injury of which they knew or ought to have known". (The Wilkins referred to the farmers who planted the seed as "consumers" of it.) They submitted that "[t]he risk of injury was to introduce a weed seed to the consumers' farm that had the potential to cause ... loss in eradicating it or in restricting [the consumers'] income potential in the use of [their] farm". They further submitted that Dovuro could have discharged its duty of care by providing a warning "or, perhaps, by labelling the bags thereby advising the consumers of the presence of the weed seeds". In its final submissions at trial, Dovuro conceded that it owed the Wilkins "a duty to take reasonable care" but denied that it had breached that duty. Plainly, it would have been better if Dovuro had identified precisely what it was conceding and, in particular, the content of the duty that it was accepting that it owed174. Having regard to the point in the trial at which the concession was made, however, it was open to the primary judge to understand it, as he did, as conceding the existence of the duty which the Wilkins had asserted in their written submissions: a duty to exercise reasonable care not to expose the Wilkins (and other farmers who planted the Karoo seed) to a risk of injury of which Dovuro knew or ought to have known. The concession having been made, it followed, inevitably, that the focus of debate in final submissions at trial shifted to the question of breach. It also followed that the primary judge's reasons gave 174 cf Jones v Bartlett (2000) 205 CLR 166 at 250 [286], 252 [289] per Callinan J. little attention to the question of duty of care, beyond noting175 that it was conceded. On appeal to the Full Court, however, the question of duty re-emerged. At trial, Cropmark had denied that it owed the Wilkins any duty of care. The primary judge concluded that Cropmark did owe a duty of care to end-users of the seed it produced but that it had not breached its duty. The content of the duty which was said to be owed was not spelled out. On appeal to the Full Court, Cropmark sought to support the judgment that had been entered in its favour by contending that it had not owed the Wilkins any duty to take reasonable care to avoid causing them economic loss. This submission having been made, counsel for Dovuro sought leave to take the same point. The Full Court divided on whether the course of events at trial should be held to have prevented Dovuro submitting on appeal that it owed the Wilkins no duty to take reasonable care to avoid causing them economic loss. Two members of the Court, Branson and Finkelstein JJ, concluded176 that Dovuro should not be permitted to withdraw its concession at trial; Gyles J was of the contrary view177. Because we hold that no breach of duty was established it may be thought unnecessary to consider whether Dovuro should, or should not, have been permitted to make the contentions it did about duty of care. But the point is not unimportant and it is as well to say something briefly about it. Raising a new point on appeal In deciding whether a party may take a point for the first time on appeal, the principles to be applied are well known. Those principles have been discussed, in this Court178, in several cases. As was said in Coulton v Holcombe179, "[i]t is fundamental to the due administration of justice that the 175 (1999) 169 ALR 276 at 302 [90], 305 [97]. 176 (2000) 105 FCR 476 at 487 [38] per Branson J, 508-509 [118]-[120] per 177 (2000) 105 FCR 476 at 527 [180]-[181]. 178 Suttor v Gundowda Pty Ltd (1950) 81 CLR 418; Bloemen v The Commonwealth (1975) 49 ALJR 219; Green v Sommerville (1979) 141 CLR 594; O'Brien v Komesaroff (1982) 150 CLR 310; University of Wollongong v Metwally (No 2) (1985) 59 ALJR 481; 60 ALR 68; Coulton v Holcombe (1986) 162 CLR 1; Banque Commerciale SA, en Liquidation v Akhil Holdings Ltd (1990) 169 CLR 279; Hollis v Vabu Pty Ltd (2001) 207 CLR 21. 179 (1986) 162 CLR 1 at 7. substantial issues between the parties are ordinarily settled at the trial". But the rule against raising a new point for the first time on appeal is not absolute. As Mason J said in O'Brien v Komesaroff180, "[i]n some cases when a question of law is raised for the first time in an ultimate court of appeal ... it is expedient in the interests of justice that the question should be argued and decided". The concession which Dovuro made was a concession of law, not of fact. When Dovuro made its concession, there was no amendment made to the pleadings. It was, however, a concession which was to be understood in the light of the allegation that had been made about duty, an allegation couched in very general terms. The point which Dovuro sought to agitate in the Full Court was a point that had been alive on the pleadings and in the trial until final addresses. The parties, therefore, had adduced evidence, and cross-examined witnesses, in circumstances where duty remained a live issue. It could not be said that Dovuro's concession affected the course of evidence. But once the point was conceded, the primary judge was relieved of any need to make findings of fact relevant to the issue of duty and no such findings were made. To decide whether making the concession barred Dovuro from making the submissions which it wished to make (that it owed no duty to take reasonable care to avoid inflicting economic loss on the Wilkins or others) it would be necessary to examine more closely the content of the argument which Dovuro sought to advance about duty of care on appeal to the Full Court and in this Court. It would be necessary to do that giving particular attention to whether the factual substratum for the competing arguments of the parties was sufficiently established by the findings that were made or could satisfactorily be established in the appellate court. If, for example, the argument advanced on appeal depended upon the appellate court making new or additional findings of fact, there may be difficulties in doing so which would bar the appellant making the new argument. Because this matter should be resolved at the level of breach of duty, not duty of care, it is not necessary to decide whether Dovuro should be held to have been prevented by its concession at trial from advancing the arguments about duty which it did. Nonetheless, in order to understand what is said about breach of duty, it is desirable to say something more about Dovuro's contentions about duty, and to begin by noting some facts relevant to the question of duty. 180 (1982) 150 CLR 310 at 319. Duty of care Although it did not grow the seed, Dovuro occupied a position in the chain of distribution from grower to farmer which was not significantly different from that of a manufacturer. Dovuro had the analyses of the seed and it knew, therefore, what was in the seed. It was Dovuro that decided to import the seed into Australia and it was Dovuro that decided the regions of Australia in which it would sell the seed by sale to distributors. It was Dovuro that supplied the bags in which the seed was sold. Obvious parallels can be drawn between Dovuro's role and that of the product manufacturer considered in Donoghue v Stevenson181, but the inquiry about duty of care cannot stop at the point of making that comparison. The duty of care which the Wilkins argued that Dovuro owed them, and others who had bought the Karoo seed which Dovuro imported, was a duty to exercise reasonable care not to expose them (as consumers of the seed) to a risk of injury of which Dovuro knew or ought to have known. That formulation of the duty was very general. It did not seek to differentiate between kinds of injury. Dovuro's submissions about duty of care and breach of duty were not always separated. That may be the inevitable consequence of the role played by foreseeability of harm at each of those levels of inquiry. Dovuro submitted that it owed no duty to take reasonable care to avoid economic loss that followed from the government authorities taking the precautionary measures they did, because, among other things, the taking of such measures was not reasonably foreseeable. (It also submitted that to find a duty of care would expose it to liability to an indeterminate class, and to persons Dovuro would not expect to rely on it and to persons for whom Dovuro assumed no responsibility.) Dovuro further submitted that it owed no duty of care which had required it to do anything more before distributing the seed than the steps it had taken. This last contention rolled questions of duty and breach together by seeking to have the duty of care described in terms that would reveal the respect or respects in which it had been breached in the circumstances of the particular case. Although reference was made in the course of Dovuro's submissions in this Court to the loss sustained by the Wilkins and others being properly classified as purely economic loss, the chief weight of Dovuro's argument appeared to be placed on the proposition that its conduct had not been unreasonable because what happened was not reasonably foreseeable. That proposition is evidently relevant to questions of breach. The nature of the damage suffered, and the respects in which it is said that Dovuro was negligent are relevant, as was said in Modbury Triangle Shopping Centre Pty Ltd v Anzil182, to defining the scope and content of the duty of care. In cases where the extent of the relevant duty is not clear, it is useful to begin by considering the damage which the plaintiff suffered and the particular want of care which was alleged against the defendant. That may reveal the scope of the duty upon which the allegations of breach and damage depended. In the present case, however, in determining the effect of the concession made at trial, that Dovuro did owe the Wilkins and other farmers a duty of care, it is necessary to identify what was conceded. That is a task which is not assisted by introducing consideration of what was, or might be, said about breach, if only because the duty conceded was cast at a high level of abstraction and generality. Since Caltex Oil (Australia) Pty Ltd v The Dredge "Willemstad"183 it has been clear that there is no absolute rule denying a duty to take reasonable care to avoid pure economic loss. Those who claimed to have suffered loss, in this case, were farmers who had used the seed which Dovuro had imported. They were, in effect, the users or consumers of the seed which Dovuro had distributed. If Dovuro failed to act with reasonable care, it was reasonably foreseeable that there could be circumstances in which those farmers may suffer economic loss as a result of their using the seed. The class likely to be affected, being those who used the seed, would not be an indeterminate class and they would be persons vulnerable to loss if care were not taken184, although it may be that assumptions about the respective vulnerabilities of experienced large scale farmers and a seed supplier should not be made too readily. All this being so, a duty to exercise reasonable care not to expose the farmers (as users or consumers of the seed) to a risk of injury of which they knew or ought to have known could, in some circumstances, extend to the risk of purely economic loss. But as the Wilkins' case was presented at trial, the critical question in this matter was to identify whether Dovuro knew or ought to have known that there was a risk of the sort of injury which it was alleged had been suffered – financial loss occasioned by pursuing a course of action recommended by government authorities to guard against the possible emergence of plants which had been declared to be harmful only after Dovuro had distributed the seed and the farmers had acquired it. Only if that sort of loss was reasonably foreseeable by Dovuro would the duty asserted by the Wilkins have been engaged. 182 (2000) 205 CLR 254 at 290 [105] per Hayne J. 183 (1976) 136 CLR 529. 184 Perre v Apand Pty Ltd (1999) 198 CLR 180 at 194 [12] per Gleeson CJ, 231 [133] per McHugh J, 255-256 [206], 258 [213], 259-260 [216] per Gummow J, 326-327 [409], 327 [412], 328 [416] per Callinan J. The concession made at trial did not foreclose, and was not understood as foreclosing, debate about foreseeability of the kinds of loss sustained. As the case was argued both at trial and subsequently, the concession about duty was, therefore, of little significance. Rather, the focus of debate was upon what reasonable care required of Dovuro and that required close attention to what should have been held to be reasonably foreseeable. Given the nature of the cases pleaded and presented at trial, both in evidence and final submissions, it is better to consider that question in the context of breach of duty rather than duty of care. Breach of duty At trial, the Wilkins submitted that it was foreseeable that the State government would take action of the kind it did, and that the Wilkins would respond to that action by incurring the costs which they did. Dovuro submitted that, because the importation of the seed had to be cleared by the Australian Quarantine and Inspection Service and because the three plants whose seeds were found in the canola seed were not prohibited or declared in Western Australia, it had not acted unreasonably. The primary judge concluded185 that Dovuro had acted unreasonably. There were two steps critical to that conclusion. First, the primary judge said186 that it should have been "readily evident, especially to a person trained in agricultural science" that it would be impossible for a regulatory authority to anticipate by declaration every exotic weed that might enter the State and threaten agriculture. Secondly, he concluded187 that the possibility that plants not proved to be a problem in the agricultural areas of the State might prove to be pests should be obvious "to anybody with even a superficial knowledge of Australian agriculture and agricultural history". Accordingly, so the primary judge held188, it was not sufficient for Dovuro "to do no more than comply with the relevant quarantine regulations". As Finkelstein J rightly pointed out189, the usual knowledge of an agricultural scientist cannot set the standard of care to be observed by a seed 185 (1999) 169 ALR 276 at 310-311 [106]-[109]. 186 (1999) 169 ALR 276 at 310 [106]. 187 (1999) 169 ALR 276 at 310 [106]. 188 (1999) 169 ALR 276 at 311 [107]. 189 (2000) 105 FCR 476 at 506 [110]. merchant190. Further, common knowledge of the kind to which the primary judge referred is of no significance unless there is a basis for concluding that the reasonable person in Dovuro's position not only ought reasonably to have known, or to have found out, whether any of the three plants already grew in the area concerned, but also knew, or ought reasonably to have known that, if the plants were exotic, they would or may later be declared to be prohibited plants. The Wilkins' case depended upon them demonstrating that Dovuro knew, or ought reasonably to have known, that importing and selling the seed for distribution in Western Australia exposed the Wilkins, and other purchasers of the Karoo seed, to a risk of the injury that would follow if the three plants whose seeds were found in what was distributed were declared to be prohibited. The primary judge did not find that Dovuro knew that this would happen. Nor was there any finding that Dovuro ought to have known that it would or even might happen. Instead, the primary judge appears to have reasoned from the proposition that "an introduced plant may prove to be a weed" to what amounted to the proposition that "cleavers, redshank and field madder were introduced plants and, regardless of whether they proved to be weeds, it should have been reasonably foreseeable to a seed merchant that government authorities may treat them as if they were weeds". That reasoning is flawed. The primary judge did not find that the plants had proved to be weeds. As pointed out at the beginning of these reasons, no farmer had reported the growth of any of the three plants and the primary judge made no finding about why it appeared that none had grown. Not finding (and there being no evidence to find) that all farmers who had bought the Karoo seed which Dovuro had imported had followed the recommendations of AgWest, the primary judge did not find (and could not have found) that but for those steps the plants would have emerged as a pest. Rather, as his Honour said191, there were three possible explanations of why none had been reported: they had failed to germinate because of unfavourable soil or climatic conditions, or they had been smothered by the canola, or they had been killed by herbicides applied by farmers. It was not possible, in this state of the evidence and findings, to say positively that the seeds of the three plants were "dangerous" or even "undesirable" seeds, unless account was taken of the fact that in Western Australia they were later declared to be prohibited plants. It was the fact of declaration which led most immediately to farmers incurring costs by carrying 190 cf Tame v New South Wales (2002) 76 ALJR 1348 at 1409 [331] per Callinan J; 191 ALR 449 at 533-534. 191 (1999) 169 ALR 276 at 291 [52]. out the recommended precautionary steps. It was that which made them "undesirable". As Finkelstein J pointed out192, again correctly, when Dovuro imported and distributed the seed, none of the three plants whose seeds were present with the canola seed was known to be dangerous. Before the declarations under the Protection Act, no Australian government had declared any of them to be a prohibited weed. The finding that Dovuro had acted without reasonable care could be supported only if it were open to the primary judge to conclude that Dovuro should reasonably have foreseen the possibility that the three plants would or may be declared to be prohibited plants. That is not demonstrated by saying that it is possible that any plant introduced into the State may be declared to be a prohibited plant. Nor is it demonstrated by attaching the label "undesirable" as a description of the seeds (as the Wilkins had done in their pleadings and submissions). The label "undesirable" provides no answer to an inquiry about what might be foreseen; it simply assumes the result of the inquiry. Whether the steps taken by AgWest and the Agriculture Protection Board after the importation of these seeds were reasonably foreseeable had to be judged according to what Dovuro knew or ought reasonably to have known when it was importing and distributing the seed. It also had to be judged according to whether the steps that were taken by these governmental authorities were to be expected or foreseen. That latter question is not answered by asking only whether it was "reasonable" for the authorities to act as they did, or by asking, as the primary judge did193, whether AgWest had over-reacted. Much would turn on the criteria used to determine what was reasonable or what constituted "over-reaction". The criteria used to determine those issues differ in important respects from the criteria that must be engaged in considering whether a person has acted without reasonable care. For example, what account could be taken of financial and political pressures on bodies like AgWest or the Agriculture Protection Board? What is done by government or governmental agencies will often reflect such pressures, but is the person whose conduct is alleged to have been negligent to be thought to be aware of them? Is the allegedly negligent person to be assumed to be attuned to the relative strengths of various pressure groups both within and outside the administration of bodies like AgWest or the Agriculture 192 (2000) 105 FCR 476 at 506 [110]. 193 (1999) 169 ALR 276 at 293-297 [62]-[73]. Protection Board? Absent evidence to the contrary, there is no reason to answer any of these questions affirmatively. Yet each of the factors mentioned may be very important in motivating the decisions of AgWest and the Agriculture Protection Board. The primary judge said194 that "it would not have taken any significant time for an officer of Dovuro to contact the Weed Seeds Unit of AgWest ... and obtain advice on the acceptability of the foreign seeds identified" in the Karoo seed. That a request for advice could have been made quickly is self-evident. It is by no means clear, however, except through the lens of hindsight, that any relevant advice could have been obtained at all, let alone quickly. Given that the seeds were of plants that were not then declared plants, there is no reason to think that any advice could have been obtained from the department about what future legislative action would or might be taken. Certainly the department would not have been obliged to provide such advice, and it may greatly be doubted that it would have been prudent for AgWest or any other governmental agency to offer some prediction about whether a declaration would be made. Finally, there was considerable emphasis given at trial, and some emphasis given in the reasons of the primary judge, to certain answers given in evidence by an officer of Dovuro to questions asked by the primary judge, and to some letters and memoranda of Dovuro which were tendered in evidence. The answers and the documents were taken to constitute significant admissions by Dovuro195. It may readily be accepted that what is said after an event may constitute an admission of relevant facts. Tendering an apology for what has happened (as Dovuro did to canola growers) may, in some cases, amount to such an admission. But there is always the risk that what is said after an event is informed only by hindsight and the speaker's wish that the clock might be turned back. In this case, the primary judge pressed one of the witnesses called by Dovuro with a series of questions about what the witness might have done differently. The witness said that "looking back" he "probably wouldn't have even grown seed in New Zealand" and that he "would have done a lot of things a little bit differently"196. Taken in their context, however, these statements, like the apologies which Dovuro offered growers, revealed nothing about the respect or respects in which Dovuro ought reasonably to have acted in the light of what it knew or ought to have known when it distributed the seeds. 194 (1999) 169 ALR 276 at 308 [102]. 195 (1999) 169 ALR 276 at 285-287 [37]-[39], 307 [101]. 196 (1999) 169 ALR 276 at 307 [99]. Where none of the seeds was known to be dangerous or had been prohibited, there was no basis for concluding that Dovuro should reasonably have foreseen the events of the kind that occurred. The appeal should be allowed with costs. Paragraph 1 of the orders of the Full Court of the Federal Court made on 21 December 2000 and paragraphs 3, 4 and 6 of the orders of that Court made on 5 March 2001 should be set aside and in their place there should be orders that: the appeal by Dovuro Pty Ltd ("Dovuro") against the declarations made by Wilcox J on 19 May 2000 is allowed with costs; the declarations made by Wilcox J on 19 May 2000 are set aside and in their place there be judgment for Dovuro with costs. Dovuro also appealed against so much of the orders which the Full Court made on 5 March 2001 as disposed of Dovuro's motion seeking reconsideration of the orders made by the Full Court on 21 December 2000. Given the orders which we consider should be made otherwise disposing of the appeal to this Court it is neither necessary nor appropriate to interfere with the orders made in disposing of that motion. 177 HEYDON J. I agree with Gummow J, and also with Hayne and Callinan JJ.