Case: Bass v Permanent Trustee Co Ltd [1999] HCA 9 ; (1999) 198 CLR 334
Outcome: applied
The legal principles that govern the exercise of the Court's discretion under this rule have been discussed in a number of recent cases, and are well established: see Bass v Permanent Trustee Co Ltd [1999] HCA 9 ; (1999) 198 CLR 334 (' Bass' ) at 355-359; Tepko Pty Ltd v Water Board [2001] HCA 19 ; (2001) 206 CLR 1 (' Tepko' ) at 55; Reading Australia Pty Ltd v Australian Mutual Provident Society (1999) 217 ALR 495 (' Reading' ) at 497-500 [7]-[11]; Direct Factory Outlets Homebush Pty Ltd v Property Council of Australia [2005] FCA 1002 ( 'Direct Factory Outlets' ) at [2]-[4]; Souflett Beheer v AWB Limited [2004] FCA 518 ( 'Souflett Beheer' ) at [19]-[20]; Kockums AB v Commonwealth [2002] FCAFC 138 at [38] - [41] ; SmithKline Beecham (Aust) Pty Ltd v Chipman [2002] FCA 674 (' SmithKline' ) at [35]-[39]; SPI Spirits (Cyprus) Ltd v Diageo Australia Ltd [2006] FCA 14 (' Diageo' ) at [22]-[27]; Save the Ridge Inc v Commonwealth [2005] FCAFC 203 ; (2005) 147 FCR 97 ( 'Save the Ridge' ) at 103-104 [15]-[17]; Rainsford v Victoria [2005] FCAFC 163 ; (2005) 144 FCR 279 (' Rainsford' ) at 291-294 36-44; Director of Fisheries (NT) v Arnhem Land Aboriginal Land Trust [2001] FCA 98 ; (2001) 109 FCR 488 ( 'Director of Fisheries' ) at 521 [139] and 526-527 [163]; and Tallglen Pty Ltd v Pay TV Holdings Pty Ltd (1996) 22 ACSR 130 (' Tallglen' ) at 141-142. 31 It would not be appropriate to separate a question if it would not permit or involve a conclusive or final judicial decision that is based on concrete facts, either established or agreed, for the purpose of quelling a controversy between the parties: Bass at 355 [45] and 357 [49]; and Reading at 498 [8]. In Bass , Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ said at 357 [49]: 'As the answers given by the Full Court and the declaration it made were not based on facts, found or agreed, they were purely hypothetical. At best, the answers do no more than declare that the law dictates a particular result when certain facts in the material or pleadings are established. What those facts are is not stated, nor can they be identified with any precision. They may be all or some only of the facts. What facts are determinative of the legal issue involved in the question asked is left open. Such a result cannot assist the efficient administration of justice. It does not finally resolve the dispute or quell the controversy. Nor does it constitute a step that will in the course of the proceedings necessarily dictate the result of those proceedings. Since the relevant facts are not identified and the existence of some of them is apparently in dispute, the answers given by the Full Court may be of no use at all to the parties and may even mislead them as to their rights. Courts have traditionally declined to state - let alone answer - preliminary questions when the answers will neither determine the rights of the parties nor necessarily lead to the final determination of their rights. The efficient administration of the business of courts is incompatible with answering hypothetical questions which frequently require considerable time and cause considerable expense to the parties, expense which may eventually be seen to be unnecessarily incurred.' 32 The separate question procedure poses special problems where the preliminary question is one of mixed fact and law: Bass at 358 [53]. In that situation, it is essential that there be precision both in formulating the question and specifying the facts upon which it is to be decided for the reasons given by Brooking J in Jacobson v Ross [1995] 1 VR 337 at 341. 34 In Bass at 359 [56], the High Court said that it would be contrary to the judicial process and no part of the judicial power to effect a determination of rights by applying the law to facts which are neither agreed nor determined by reference to the evidence in the case. The Full Federal Court applied this principle in Rainsford at 291 [36] and Director of Fisheries at 526 [163]. In Rainsford at 291 [36], Kenny J said that, in order for a court exercising federal jurisdiction to utilise the separate questions procedure, either the parties must agree on the relevant facts or the court must determine the facts before deciding the question. 46 While the refusal of declaratory relief on discretionary grounds will always be heavily dependent on the facts of the particular case, the discretion must be exercised within a framework of relevant legal principle. The cases afford guidance as to the way in which the discretion is to be exercised. In this sense, the question whether declaratory relief should be refused as a matter of discretion raises questions of fact and law, albeit heavily weighted towards the former. The separation of such a question poses special problems for the reasons stated by the High Court in Bass at 358 [53] and by Brooking J in Jacobson at 341. 56 In my opinion, the statements of principle by Branson J in Reading (which are summarised above in paragraph 33) are directly applicable. So too are the principles stated in Bass and Jacobson concerning mixed questions of fact and law. I am not satisfied that all of the necessary facts have been ascertained, agreed or proven so as to permit the judicial determination of question 1.1 as a separate question. Further, I am not satisfied that, on a separate trial of question 1.1, the Court would be placed in a position where it can consider all relevant matters before it exercises its discretion to grant or refuse relief. 63 The Commonwealth expressly conceded that this proceeding is neither hypothetical nor abstract, and raises a genuine controversy that constitutes a 'matter' appropriate for judicial determination: Bass at 355-356; Ainsworth v Criminal Justice Commission [1992] HCA 10 ; (1992) 175 CLR 564 at 581-582 and 596; and Oil Basins Ltd v Commonwealth [1993] HCA 60 ; (1993) 178 CLR 643 at 649-650. Nonetheless, the Commonwealth submitted that, because of the presently incomplete definition of the issues that will have to be resolved in this Court, the proceeding is premature. In my opinion, this submission does not assist the Commonwealth's application for separate trials. In any proceeding, the process of joining and defining the issues of fact and law that will fall the decision takes some time, and will ordinarily follow the institution of proceedings. The issues in this case are still being defined and there are several reasons why that process is incomplete: the Commonwealth wished to pursue its notice of motion for separate questions at this hearing, which the Court had originally set aside as a hearing at which it was anticipated that there would be a trial of all issues; AWB has filed most but not all its evidence in support of its privilege claims; and the Commissioner has, thus far, taken the stance that it would be inappropriate for him as a submitting respondent to assist the Commonwealth, or the Court, to determine the merits or otherwise of AWB's claims for privilege.